FORM 10-K
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]
For Fiscal Year Ended: December 31, 1994
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from ________________ to ______________
Commission file number 0-14452
Far West Electric Energy Fund, L.P.
(Exact name of registrant as specified in its charter)
Delaware 87-0414725
State or other jurisdiction of (I.R.S. Employer
incorporation or organization Identification No.)
921 Executive Park Drive, Suite B, Salt Lake City, Utah 84117
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (801) 268-4444
Securities registered pursuant to Section 12(b) of the Act: NONE
Securities registered pursuant to Section 12(g) of the Act:
Units of Limited Partnership Interest
(Title of class)
Indicate by check mark whether the registrant (1) has filed
all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the registrant was required to file
such reports), and (2) has been subject to such filing requirements
for the past 90 days. Yes X No ___
Total pages:
Exhibit Index Page:<PAGE>
Form 10-K
The registrant is a limited partnership and has no voting
stock. At this time there is no market for trading a partnership
interest in the registrant. 93.9% of the partnership interests are
owned by non affiliates.
Indicate by check mark if disclosure of delinquent filers pursuant
to Item 405 of Regulation S-K is not contained herein, and will not
be contained, to the best of registrant's knowledge, in definitive
proxy or information statements incorporated by reference in Part
III of this Form 10-K or any amendment to this form 10-K. [X]
DOCUMENTS INCORPORATED BY REFERENCE
NONE
<PAGE>
PART I
Item 1. Business.
Far West Electric Energy Fund L.P., a Delaware limited
partner-ship (the "Partnership"), was originally organized in
September 1984 under the Uniform Limited Partnership Act of Utah as
Far West Hydroelectric Fund, Ltd. On December 20, 1988, the
Partnership changed its name to Far West Electric Energy Fund, L.P.
and changed its domicile to Delaware.
The Partnership owns a geothermal power plant, (the
"Steamboat Springs Plant") located in Nevada, and until recently,
owned a hydroelectric plant located in Idaho (the "Crystal Springs
Plant").
The Crystal Springs Plant was sold to Crystal Springs
Hydroelectric, L.P., a Washington limited partnership pursuant to
a Purchase and Sale Agreement dated February 28, 1995, which is
attached hereto as Exhibit (10)(aai). Also attached as exhibits
are the documents which are attached as exhibits to the Purchase
and Sale Agreement and other related sale documents.
The sales price was $1,100,000 which was $895,063 less than the
outstanding debt on the project. The general partner decided to
accept that offer (at the urging of the Bank) rather than incur the
potential expense of foreclosure and the substantial risk of a much
larger deficiency judgment. All funds from the sale went to the
Bank. In addition, a Third Extension and Modification Agreement
was reached with the Bank pursuant to which the deficiency was
reduced to an agreed upon amount of $537,000. Semi-annual interest
payments are due thereon with the entire balance to be paid by
March 15, 2000. If the balance is paid within three years, this
deficiency will be reduced by $50,000 and if paid within two years
the deficiency will be reduced by $100,000. The Third Extension
and Modification Agreement is attached hereto as Exhibit (10)
(aas). The $537,000 agreed upon deficiency was set forth in an
Amended and Substituted Promissory Note which is attached hereto as
Exhibit (10)(aat). See "Item 2. Properties" for more information
regarding the Partnership's power plants.
The principal revenue-producing activities of the Partnership
commenced as of December 31, 1985, following the completion in
November 1985 of a public offering of its Units of limited
partnership interests registered under the Securities Act of 1933.
Since 1986, the Partnership has realized significant revenues from
its business of selling power generated by its plants to public
utilities pursuant to the Public Utility Regulatory Policies Act
("PURPA"), and in accordance with regulations of the Federal Energy
Regulatory Commission ("FERC") and of the state public utility
commissions of Idaho and Nevada.
Electricity has been generated by the Partnership's
hydro-electric and geothermal power plants and sold to the Idaho
Power Company and to the Sierra Pacific Power Company, pursuant to
long-term contracts for 35 and 20 years, respectively. 100% of the
power generated by the Crystal Springs Plant was sold to Idaho
Power Company and 100% of the power generated by the Steamboat
Springs Plant is sold to Sierra Pacific Power Company. Since the
sale of the Crystal Springs Plant, the Partnership is dependent
upon the continued financial stability of Sierra Pacific Power
Company to honor its power purchase contract.
In addition to its ownership of the Steamboat Springs Plant,
the Partnership owns certain piping and accessory equipment and is
entitled to receive pumping fees and a net subordinated royalty in
connection with the operation of the 1-A Plant located adjacent to
the Steamboat Springs Plant. See "Item 2. Properties."
The Partnership's two power plants were operated on a
day-to-day basis by contract operators, Ormat, Inc. ("Ormat")
through October 10, 1990, and by SB GEO, Inc. thereafter in the
case of the Steamboat Springs Plant and in the case of the Crystal
Springs Plant by Bonneville Pacific Corporation ("BPC"), until
December, 1991, then by CHI until December, 1992 and by Little Mac
Power Services Co. since December 1, 1992. The Partnership has no
employees, but relies on the staff of Far West Capital, Inc. ("Far
West Capital"), a General Partner of the Partnership together with
Alan O. Melchior and Thomas A. Quinn, who are officers, directors,
and 90% shareholders of Far West Capital and were also General
Partners of the Partnership until they resigned as General Partners
effective January 1, 1995. The Amendment to the Certificate and
Agreement of Limited Partnership of Far West Electric Energy Fund,
L.P. is attached hereto as an Exhibit (3)(b). The term "General
Partner" as used herein, means Far West Capital and Messrs.
Melchior and Quinn until they resigned as General Partners
effective January 1, 1995. The Partnership also employs outside
consultants as necessary. As of the date of this filing, Far West
Capital has nine employees who have varied amounts of
responsibility for the Partnership and for other partnerships for
which Far West Capital is the General Partner.
Protection of the environment is a major priority for the
Partnership. The Partnership engages in activities within the
jurisdiction of federal, state and local regulatory agencies.
Those agencies have issued the Partnership permits for these
activities subject to air quality, water quality, and waste
management laws and regulations. The Partnership is currently in
compliance with such laws and regulations. See "Item 2.
Properties."
Item 2. Properties
Steamboat Springs thermal-hydroelectric plant.
The Steamboat Springs Plant is located ten miles south of
Reno, Nevada on property leased from Sierra Pacific Power Company
pursuant to a Geothermal Resource Lease in the Steamboat Known
Geothermal Resource Area. The plant has gross capacity of
approximately 6.5 megawatts and consists of seven separate modules,
utilizing binary rankine cycle turbines.
In 1987 it was determined that to achieve the expected
capacity and the performance requirements specified in the
Steamboat Springs Plant's purchase contract, Ormat would have to
install additional equipment and make some modifications to
existing equipment. These corrections were made at no cost to the
Partnership (although the down-time for modifications and testing
adversely impacted revenues). The modifications and repairs were
completed in the summer of 1988, and the Partnership was informed
that the plant was performing near projected levels by the fall of
1988. However, during 1989 the plant produced approximately
36,000,000 kwh (about the same as 1988) which is substantially less
than the 42,000,000 kwh which was the annual production for the
plant, as modified, projected by Ormat and the 43,800,000 kwh
called for by the Purchase Agreement.
After reviewing the Steamboat Springs Plant performance with
independent consultants, the General Partner concluded that the
deficiencies in plant performance were attributable to both poor
operating practices employed by Ormat, the former operator, and
certain problems in plant design. Consequently, notice was given
to Ormat that the Partnership believed that Ormat was in default
under both its Operating and Purchase Agreements with the
Partnership. The General Partner replaced Ormat as plant operator
on October 11, 1990, and sought redress for plant deficiencies
under the arbitration clause of the Purchase Agreement.
Arbitration proceedings began October 29, 1990.
The claims of the petitioners as well as the counter claims
of Ormat were numerous and complex, making it difficult to
summarize the ruling of the Arbitration panel. However, in essence
the panel denied the bulk of Petitioners' claims and Ormat's
counter claims. Petitioners were awarded $175,000 for well field
problems, and Ormat was awarded $254,000 for unpaid operating and
warranty service, the payment of which had been withheld pending
the completion of the Arbitration. The Parties have all complied
with and satisfied the ruling of the Arbitrators, including payment
of all awards. (See Part IV, Item 14, Exhibits, Form 10-K dated
December 31, 1992.
The present operating agreement provides for SB Geo, Inc.
("SB GEO") to operate and maintain the plant for a period of 10
years. SB GEO is to operate the plant on a no profit basis
(salaries and expenses) and will not pay any dividends or
distributions to shareholders. In the long term this change to the
new operator generally has brought increased power production and
lower operating costs. However, because the Arbitration relieved
Ormat from its warranty obligations, the Partnership has incurred
increased cost associated with equipment repairs that otherwise
would have beencovered by the Ormat warranty.
In October 1991, the Partnership assigned its 77% ownership
interest and 1-A Enterprises assigned its 23% ownership in SB GEO
to Messrs. Melchior and Quinn, who accepted the assignments and SB
GEO's liabilities. According to an independent valuation firm, SB
GEO had no value as of the transfer date due to its obligations and
its cost basis operating status. Consequently, no gain or loss was
recognized as a result of the assignment.
On October 23, 1992 Westinghouse Credit Corporation
("WCC") gave the Partnership a notice of default with regard to the
long-term financing of the project for the Partnership allowing the
reserve account to fall below its reserve requirement without
adequate replenishment and because the Award of Arbitrators in the
Ormat Arbitration exceeded $25,000. Since that date the parties
have met in negotiations on several occasions and WCC has
acknowledged that the parties are working together in good faith
toward a resolution and that WCC has observed progress and
anticipates further progress toward a mutually satisfactory
resolution. The General Partner continues to believe that a
resolution will be reached which will result in a cancellation of
the default.
Crystal Springs hydroelectric plant.
The Crystal Springs Plant is located ten miles west and seven
miles north of Twin Falls, Idaho. Its leased site is located in
Cedar Draw which flows into the Snake River Canyon. Its primary
components consist of four horizontal Francis-type turbines with an
installed total capacity of 2.88 megawatts. Until March 16, 1995,
it was owned by the Partnership through Crystal Springs
Hydroelectric Company ("CSHC"), a general partnership owned by the
Partnership.
The Crystal Springs Plant was placed into operation during
December, 1985, but did not generate significant revenues until the
first quarter of 1986, primarily due to seasonal water shortage
conditions. During the last quarter of 1987, the Partnership
received information which suggests that the Crystal Springs Plant
design was based on overly optimistic water flow assumptions and
that it would not be able to consistently achieve projected average
annual production figures. On July 7, 1988, the Partnership
entered into a Purchase Option Agreement, effective October 1,
1987, with Bonneville Pacific Corp. ("BPC"), the company which sold
the project to the Partnership. In conjunction therewith, as an
accommodation, the Partnership signed refinancing loan documents
("Loan") with First Security Bank of Utah ("Bank").
A Restated Operation and Maintenance Agreement ("O&M
Agreement") entered into as of October 1, 1987, dated July 7, 1988,
between CSHC and BPC, served to install BPC, or a representative of
its choice, as the operator of the Crystal Springs Plant. This O&M
Agreement also set forth BPC's duties as the operator. The terms
of this O&M Agreement would run through September 30, 1997, unless
terminated earlier, as provided in the O&M Agreement.
Under this O&M Agreement, BPC was responsible for the daily
operation and maintenance of the plant, maintenance of accounting
records, disbursements from available power revenues, supervision
of employees interaction with power purchasers, and maintenance of
the facility in a safe operating condition. In return, BPC was
compensated a minimum of $20,000 per year; subject to increases by
an amount equal to 10% of all profits between $0 and $20,000, plus
95% of all profits which exceed $20,000 per year.
BPC accounted for revenues and expenses incurred by BPC
inconnection with the operation and maintenance of the Crystal
Springs Plant; CSHC was responsible for insurance expenses and
property tax expenses. In view of the limited participation of
CSHC in the operations, including profits and losses, as described
elsewhere herein, operations of the project were not included in
the financial statements for the years ended December 1990, 1991,
or 1992. The net cost of the Crystal Springs Plant, related
long-term debt and related depreciation, interest, insurance, and
tax expenses were included in the financial statements of the
Partnership. The debt service payments paid by the BPC were
included as other income in the financial statements.
On December 5, 1991, BPC filed for protection under Chapter
11 of the United States Bankruptcy Laws and stopped making option
payments to the Partnership and debt service payments to the Bank.
This action terminated BPC's rights under the Purchase Option
Agreement and the O&M Agreement. BPC's failure to make debt
service payments to the Bank resulted in a default notice from the
Bank.
The Partnership received such default notice from the Bank by
letter dated February 3, 1992, maintaining that CSHC was in default
of its loan obligations to the Bank.
CSHC, the Partnership and Far West filed a complaint in the
Third Judicial District Court for Salt Lake County, State of Utah,
naming the Bank as defendant and seeking a declaratory judgment
that plaintiffs were not obligated to perform the obligations under
the Loan documents because they signed them merely as accommodation
parties and seeking injunctive relief against the Bank, enjoining
the Bank from naming any of the plaintiffs in litigation seeking
money damages under the Loan documents.
The Bank subsequently filed a complaint in the District Court
of the Fifth Judicial District of the State of Idaho seeking to
foreclose on the real property security pursuant to the Mortgage.
On July 17, 1992, CSHC, the Partnership and its General
Partners ("Crystal Affiliates") entered into an agreement with the
Bank whereby the parties agreed to forbear from further action on
both above complaints. Under such agreement CSHC agreed to pay to
the Bank, on or before September 30, 1992, the sum of $1,800,000.
Upon payment of this settlement sum the Bank was to release the
parties from obligations under the Bank's loan documents.
That agreement expired prior to the Partnership's ability to
refinance or sell the Crystal Springs Plant in order to pay the
Bank the agreed upon $1,800,000 amount. The parties thereafter
entered into a subsequent settlement agreement ("Agreement")
effective December 31, 1992 which provided for dismissal of each of
the two lawsuits and payment of the $1,800,000 to the Bank by
December 1, 1993.
It also provided for a mutual waiver of claims between the
parties ("Mutual Release Agreement") and in addition provided for
a $50,000 line of credit for use in repair of certain items of
equipment for the Crystal Springs Plant for startup of operations
in 1993 ("Repair Loan"). The Partnership also agreed therein to
exercise their best efforts to sell the Crystal Springs Plant on or
before December 1, 1993, the proceeds to be used in satisfying the
Repair Loan and the $1,800,000 payoff of the Loan to the Bank.
The Mutual Release Agreement also contemplated the execution
by the Parties of an Extension and Modification Agreement with
respect to the Loan which agreement was also entered into as of
December 31, 1992 together with an Amendment to Mortgage and an
Amendment to Security Agreement which amended the original Loan
documents to provide for the issues resolved in the Mutual Release
Agreement.
In addition, effective the first day of December, 1992, a new
operator of the Project, Little Mac Power Services Co., was put in
place through an Operation and Maintenance Agreement of that date.
A restated Operation and Maintenance Agreement was entered into
effective December 1, 1994.
The Partnership was unable to refinance or sell the Crystal
Springs plant by December 1, 1993 in order to pay the Bank the
agreed upon $1,800,000 amount. In order to extend the term of the
loan for an additional nine (9) months, the parties thereafter
entered into a Second Extension Agreement as of December 1, 1993.
This agreement extended the date until September 1, 1994 for
Crystal affiliates to be able to sell the Crystal Springs plant and
use the proceeds to pay off the $1,800,000 agreed upon to the Bank.
As an incentive to enhance the flows of Cedar Draw Creek, to
provide greater revenue from the plant, CSHC entered into an
agreement dated March 8, 1993 to compensate the Twin Falls Canal
Company ("TFCC") by paying TFCC a royalty of five percent of the
energy revenue for each month. The general partner believes that
this agreement was instrumental in producing increased water flows
and revenues for the Crystal Springs Plant during 1993 and will
result in increased water flows and revenues in future years. That
agreement was attached to the December 31, 1993 Form 10-K as
Exhibit (10) (aah).
The Crystal Springs Plant was sold as described in Item 1.
above.
Revenues from the 1-A thermal-hydroelectric plant
The 1-A geothermal plant (the "1-A Plant") is located
adjacent to the Steamboat Springs Plant. The 1-A Plant consists of
two separate modules, utilizing binary rankine cycle turbines with
a combined net output of 1.8 megawatts.
The 1-A Plant was originally a Steamboat Springs expansion
project, but was sold in 1988 to a general partnership entitled 1-A
Enterprises which is owned 75% by Alan O. Melchior and Thomas A.
Quinn, who were also General Partners of the Partnership and
currently are officers and shareholders of Far West Capital. Use
of the geothermal resource by the 1-A Plant has no adverse effect
on the operation of the Partnership's Steamboat Springs Plant.
In a Second Amendment to Geothermal Resources Lease provision
was made to accommodate the 1-A Plant on the Steamboat Springs
Plant's lease. A Geothermal Resources Sublease was entered into
granting rights and defining terms and conditions for the siting
and operation of the 1-A Plant and setting forth a method of
calculating royalty payments to be made to the Partnership. This
Sublease was Revised and Restated on October 9, 1989.
As consideration for the sale of the 1-A Plant rights to 1-A
Enterprises, the Partnership received a royalty interest in the net
operating income of the 1-A Plant. Such royalties equal 10% in
1988 through 1992, 15% in 1993 through 1998, 40% in 1999 through
2010, and 45% in 2011, and thereafter. In addition, the
Partnership is paid an amount equivalent to the net profit that
would be realized by the Partnership if the 1-A Plant were bearing
150 KW of parasitic power load (power consumed by the Plant
itself). The net profit equivalent is calculated as follows:
1,200,000 KWH x the rate at which power is sold to Sierra Pacific
Power Company under the power purchase agreement applicable to the
1-A Plant, less any royalties, note payments, or net revenue
interest or other expenses associated with or payable out of such
additional revenues assuming that the 1-A Plant produced an
additional 1,200,000 KWH per annum. In 1994 the Partnership earned
$87,000.00 in royalty revenues from the 1-A Project and $57,000.00
in pumping charges.
Item 3. Legal Proceedings
Health Department
Since its inception, the Partnership has operated the
Steamboat plant under a variance granted by the Washoe County
District Health Department ("Health Department") with respect to
the release of pentane gas into the atmosphere. In 1991 the Health
Department amended the original variance in an effort to require
the Partnership to install more stringent pentane release
safeguards. The Partnership notified the Health Department that
the Partnership contested their authority to impose such additional
safeguards but agreed to voluntarily comply with the new standards.
As a part of its effort to reduce pentane emissions at the
Steamboat Springs Plant the Partnership recently installed a
cryogenic pentane recovery system. The Health Department claimed
that the Partnership installed this system after the deadline
established under their amended variance and issued a notice of
violation and fine of $15,000. Upon appeal to the Air Pollution
Control Hearing Board the fine was reduced to $5,800. After
further appeal of the notice of violation and fine to the Washoe
County District Board of Health, the Board decided to hold the fine
and citation in abeyance for 1 year. Since there were no further
environmental infractions at the Steamboat Springs Plant, during
this last year, the fine and citation were expunged.
Nevada Department of Transportation
The Department of Transportation of the State of Nevada
("NDOT") commenced action in the Second Judicial District Court of
the State of Nevada in and for the County of Washoe against the
Partnership and others to obtain, for highway purposes, ownership
of approximately 2.79 acres of the property owned by Sierra Pacific
Power Company ("SPPC") at the extreme north of the land upon which
the Steamboat Springs Plant is located pursuant to the SPPC lease.
The Partnership is defending the action insofar as is necessary to
protect a stand-by injection well located on the lease in the
proximity of the land being taken and a monitoring well in an
adjacent area which is being taken. It is presently negotiating a
settlement which will leave the stand-by injection well and the
Partnership's rights in and use thereof intact and available. The
Partnership will be required to construct a new monitoring well and
will attempt to recover the cost thereof from the State. The
Partnership is also attempting to obtain a portion of the $273,500
offered and deposited into Court by NDOT as compensation for the
taking. SPPC is claiming all of such funds as the owner of the
land. The Court has granted NDOT the right to possess and occupy
the property while the amount of compensation to be finally awarded
is being contested. WCC, the Partnership's principal creditor, has
claimed that under the financing agreements with respect to the
Steamboat Springs and 1-A Plants, all funds recovered from NDOT
must be applied to reduce the principal balance of the loans
outstanding.
Item 4. Submission of Matters to a Vote of Security Holders.
None.
PART II
Item 5. Market for Registrant's Common Equity and Related
Stock-holder Matters.
No market exists for the Partnership's Units. As of March
16, 1995, the 10,306 outstanding Units of the Partnership were held
by 1,104 investors, including 530 units owned by the General
Partner.
No cash distributions were made to the Limited Partners
during the years ended December 31, 1989 through 1994.
Item 6. Selected Financial Data.
<TABLE>
_______________Year Ended December 31__________________
<CAPTION>
1994 1993 1992 1991 1990
<S> <C> <C> <C> <C> <C>
Revenues $2,879,000 $3,784,000 $3,443,000 $3,530,000 $3,615,000
Net Income (Loss) 73,000 702,000 653,000 (437,000) (1,111,000)
Per Unit $7 $ 68 $ 63 $ (42) $ (108)
Distributions
To Limited
Partners None None None None None
Per Unit None None None None None
Total $15,320,000 $15,677,000 $16,090,000 $17,469,000 $19,893,000
Assets
Long $ 8,986,000 $ 9,536,000 $10,404,000 $12,181,000 $12,619,000
Term
Debt (Including current portion)
</TABLE>
Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations.
Liquidity and Capital Resources
The sale of electricity to Sierra Pacific Power Company
continues to be the Partnership's primary source of working
capital. Power is sold pursuant to a long-term power contract
("Power Purchase Agreement") (see "Item 1. Business") which
provides for purchase of all power produced by the Steamboat
Springs Plant at a fixed rate. However, in December of 1996 the
rate at which the plant will sell power goes from 7.17 cents per KW to
short-term avoided cost (which presently is approximately 2.5 cents).
The Partnership will not be able to continue to operate the plant
selling power at that rate. The General Partner is attempting to
renegotiate the rate at which power would be sold to Sierra Pacific
Power Company during the second 10 years of the Power Purchase
Agreement beginning in December of 1996. The Steamboat Springs
Plant operating revenues have, in the past, provided cash balances
to pay for operating expenses, including repairs and maintenance of
the plant, during times of interrupted operations. However, in the
event of failure of the Steamboat Springs geothermal resource, the
Partnership would be unprotected from interruption of its revenues.
Management believes that the likelihood of this event occurring is
considered to be remote.
As shown in the financial statements for the year ended
December 31, 1994, the Partnership's current liabilities exceed
current assets by $ 9,191,000. Of this amount, $5,340,000 relates
to the note default involving the Steamboat Springs Plant with WCC.
This is more fully described under "Item 2. Properties".
Cumulative losses for the three-year period ended December 31, 1994
amounted to $541,000 before extraordinary items. The principal
cause of these losses was due to expenses associated with poor
plant performance and higher than expected operating and
maintenance expenses due primarily to Ormat's refusal to honor its
warranty obligations, litigation and administrative proceedings and
unanticipated lower revenues. The General Partner is seeking to
resolve the current liquidity concerns by taking steps to increase
future production by improving maintenance and operation procedures
and, if necessary, deferral of payment of general and
administrative expenses to the General Partner. Partnership
electric power revenue increased in 1993 by 34% over 1992 and by
12% over 1991. The general partner believes that 1994 revenues are
representative of what can be expected in the future until the rate
change becomes effective.
With the winding down of the Partnership's litigation and
administrative proceedings, professional fees and general and
administrative expenses charged by the General Partner decreased in
1994 by 45% from the preceding year, in 1993 by 49% from the
preceding year and in 1992 by 33% from 1991. The General Partner
also believes that these expenses will continue to stay at this
lower level in 1995 because of the termination of such litigation
and decreasing administrative costs.
In a report dated September 4, 1993 the General Partner
reported to the Limited Partners on its efforts to restructure the
business of the Partnership so as to be able to resume
distributions to the Limited Partners. In summary the General
Partner concluded that the Partnership would be unable to generate
significant positive cash flow or resume distributions without the
infusion of $1,000,000 to make capital improvements in the
Steamboat Springs Plant and/or buy out the Westinghouse loan and
certain royalty interests at a discount. The Partnership does not
have the financial resources to accomplish these goals. At present
and in the foreseeable future the Partnership is generating taxable
income without any cash distributions to pay the tax liabilities.
Therefore, it appears to the General Partner that it may be
advantageous to the Partnership to consider a sale of all the
Partnership assets. At the present time the General Partner is
attempting to sell the Partnership assets and will seek approval of
the sale from the Limited Partners at such time as a serious offer
is received.
Results of Operations
In 1987 the Steamboat Springs Plant produced electric power
and generated revenues at approximately 75% of expected operating
levels. The production shortfall was primarily due to shutdowns
required to effect certain equipment changes and modifications, and
to operation of that plant at a lower level than expected. It was
determined that to achieve the expected capacity and the
performance requirements specified in the plant's purchase
contract, the vendor/operator would have to install
additionalequipment and make some modifications to existing
equipment. These corrections were made at no cost to the
Partnership (although the down-time for modifications and testing
impacted revenues). The modifications and repairs were completed
in the summer of 1988, and the Partnership was informed by Ormat
that the plant was performing at a level that would produce
42,000,000 KWH per year.
The Steamboat Springs Plant increased production of electric
power from 32,797,000 KWH in 1987 to 36,142,000 KWH in 1988.
Ormat, the vendor/operator of the plant, installed additional
equipment and made equipment modifications which increased the
plant's capacity and performance. These additions and
modifications were made at no additional cost to the Partnership.
In 1989 the Steamboat Springs Plant produced $2,564,000 in
gross revenues which was $448,000 and $576,000 less than would have
been received under the Ormat projected 42,000,000 and 43,800,000
kwh agreed to under the purchase agreement per year respectively.
In 1990 the plant produced $2,765,000 in gross revenues which was
an increase over 1989's revenues, but about $247,000 and $376,000
less than would have been received under the projected 42,000,000
and 43,800,000 kwh per year respectively. In 1991 the plant
produced $2,791,000 in gross revenues which was $220,000 and
$349,000 less than would have been received under the projected
42,000,000 and 43,800,000 kwh per year respectively. In 1992 the
plant produced about $2,360,000 in gross revenues which was
$651,400 and $780,460 less than would have been received under the
projected 42,000,000 and 43,800,000 kwh per year respectively. The
poor performance in 1992 was directly due to excessive equipment
failures and breakdowns which resulted in plant downtime. In 1993
the Plant produced $2,625,000 in gross revenues which was an
increase over 1992's revenues but about $386,391 and $515,451 less
than would have been received under the projected 42,000,000 and
43,800,000 kwh per year respectively. This made 1993 a better than
average year for revenues. In 1994 the revenues declined slightly
and are more indicitave of what can be expected until the
ratechange in 1996.
The following table shows the annual production for the
Steamboat Springs Plant:
Year $'s KWH
1987 $2,352,000 32,797,000
1988 $2,591,000 36,142,000
1989 $2,564,000 35,760,000
1990 $2,765,000 38,563,000
1991 $2,791,000 38,926,000
1992 $2,360,000 32,915,000
1993 $2,625,000 36,611,000
1994 $2,564,000 35,767,000
The Crystal Springs Plant produced power at approximately 51%
of expected levels during 1987 and 1988, about 80%, 70%, 58% and
14% during 1989, 1990, 1991 and 1992, respectively, due chiefly to
lower than normal precipitation in the Snake River Basin. In 1993
it produced a record 8,265,000 kwh for revenues of $537,000. This
was a result of increased water flow resulting from greater
precipitation and additional water released by the Twin Falls Canal
Company as a result of the agreement with it. In 1994, due to the
drought in southeastern Idaho, it was shut down for most of the
year and produced 3,101,000 kwh for revenues of $163,000.00.
SeeItem 2. Properties herein.
The 1-A Plant from which the Partnership receives royalties
was put on line and began operations in December, 1988. That plant
reached full scale production levels during the first quarter of
1989. The Partnership began to receive its 10% net operating
royalty and pumping fee when the plant was accepted and
commissioned during the first quarter of 1989. A total of $95,000,
$94,000, $115,000, $102,000, $135,000 and $144,000 in royalties and
pumping fees in the years ended December 31, 1989, 1990, 1991,
1992, 1993 and 1994 respectively, were earned by the Partnership
from this plant.<PAGE>
Item 8. Financial Statements and Supplementary Data.
Index to Financial Statements Page
and Supplementary Data
Independent Auditors' Report 17
Balance Sheets, December 31, 1994 and 1993 18
Statements of Income, for the Years Ended
December 31, 1994, 1993, and 1992 20
Statements of Partners' Capital, for the
Years Ended December 31, 1994, 1993, and 1992 21
Statements of Cash Flows, for the Years ended
December 31, 1994, 1993, and 1992 22
Notes to Financial Statements 24
Schedule I, Condensed Financial Information
of Registrant (All Required Information
Reported in Financial Statements and Notes
to the Financial Statements)
Schedule II, Valuation of Qualifying Accounts
(All Required Information Reported in Note 2)
<PAGE>
INDEPENDENT AUDITOR'S REPORT
General Partner
Far West Electric Energy Fund, L.P.
Salt Lake City, Utah
We have audited the balance sheet of Far West Electric Energy
Fund, L.P. as of December 31, 1994 and 1993, and the related
statements of income, partners' capital and cash flows for the
years then ended. These financial statements are the
responsibility of the Partnership's management. Our responsibility
is to express an opinion on these financial statements based on our
audit.
We conducted our audit in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements. An audit also
includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audit
provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above
present fairly, in all material respects, the financial position of
Far West Electric Energy Fund, L.P. as of December 31, 1994 and
1993, and the results of its operations and its cash flows for the
years then ended in conformity with generally accepted accounting
principles.
Respectfully submitted,
/s/ Robison, Hill & Co.
Certified Public Accountants
Salt Lake City, Utah
March 7, 1995<PAGE>
FAR WEST ELECTRIC ENERGY FUND, L.P.
A DELAWARE LIMITED PARTNERSHIP
BALANCE SHEETS
DECEMBER 31, 1994 AND 1993
1994 1993
Assets
Utility Plant:
Plant in Service $18,716,000 $18,692,000
Equipment 335,000 220,000
Construction in Progress 118,000 118,000
Accumulated Depreciation (6,010,000) (5,367,000)
Net Utility Plant 13,159,000 13,663,000
Restricted Marketable Securities 1,145,000 1,102,000
Other Assets 124,000 142,000
Current Assets:
Cash 278,000 280,000
Receivables - Trade 437,000 393,000
Receivables - Other 6,000 3,000
Receivable - Related Party 159,000 82,000
Prepaid Expenses 12,000 12,000
Total Current Assets 892,000 770,000
Total Assets $15,320,000 $15,677,000
<PAGE>
FAR WEST ELECTRIC ENERGY FUND, L.P.
A DELAWARE LIMITED PARTNERSHIP
BALANCE SHEETS
DECEMBER 31, 1994 AND 1993
(Continued)
1994 1993
Partners' Capital and Liabilities
Partners' Capital:
Limited Partners $ 4,868,000 $ 4,796,000
General Partner (11,000) (12,000)
Total Partners' Capital 4,857,000 4,784,000
Contingencies (Note 9) - -
Other Liabilities 150,000 150,000
Long-term Debt:
Notes Payable - Related Party 230,000 268,000
Partners' Capital and Long-Term
Liabilities 5,237,000 5,202,000
Current Liabilities:
Current Portion - Long-term Debt 7,140,000 7,857,000
Note Payable - Related Party 1,043,000 956,000
Payable-Related Party 573,000 455,000
Accrued Liabilities
Operations 495,000 596,000
Royalties 220,000 186,000
Interest 612,000 425,000
Total Accrued Liabilities 1,327,000 1,207,000
Total Current Liabilities 10,083,000 10,475,000
Total Partners' Capital and
Liabilities $15,320,000 $15,677,000
See accompanying notes to the financial statements.
<PAGE>
FAR WEST ELECTRIC ENERGY FUND, L.P.
A DELAWARE LIMITED PARTNERSHIP
STATEMENTS OF INCOME
FOR THE YEARS ENDED
DECEMBER 31,
1994 1993 1992
Revenues:
Electric Power
Revenues $ 2,728,000 $ 3,162,000 $ 2,360,000
Other Revenues 151,000 622,000 1,083,000
Total Revenues 2,879,000 3,784,000 3,443,000
Expenses:
Operations 1,779,000 2,163,000 2,014,000
General and
Administrative:
Professional Services 54,000 72,000 366,000
General Partners-
Related Party 123,000 223,000 437,000
Total General and
Administrative 177,000 295,000 803,000
Total Expenses 1,956,000 2,458,000 2,817,000
Income From
Operations 923,000 1,326,000 626,000
Other Income (Expense):
Interest Income 52,000 38,000 56,000
Interest Expense (902,000) (806,000) (1,478,000)
Write-down of Assets - - (345,000)
Bad Debt Expense - (31,000) -
Net Other Expense (850,000) (799,000) (1,767,000)
Net Income (Loss)
Before Extraordinary
Item 73,000 527,000 (1,141,000)
Extraordinary Item - Early
Extinguishment of Debt - 175,000 1,794,000
Net Income $ 73,000 $ 702,000 $ 653,000
Net Income Per
Limited Partnership
Unit $ 7 $ 68 $ 63
See accompanying notes to the financial statements.<PAGE>
FAR WEST ELECTRIC ENERGY FUND, L.P.
A DELAWARE LIMITED PARTNERSHIP
STATEMENT OF PARTNERS' CAPITAL
FOR THE YEARS ENDED DECEMBER 31, 1994, 1993, AND 1992
<TABLE>
<CAPTION>
General Partner Limited Partners
Number Number Total
of Units Amount of Units Amount Amount
<S> <C> <C> <C> <C> <C>
Balances at December 31, 1991 1 $ (25,103) 10,305 $ 3,454,103 $ 3,429,000
Net Income - 6,530 - 646,470 653,000
Balances at December 31, 1992 1 (18,573) 10,305 4,100,573 4,082,000
Net Income - 7,020 - 694,980 702,000
Balances at December 31, 1993 1 (11,553) 10,305 4,795,553 4,784,000
Net Income - 730 - 72,270 73,000
Balances at December 31, 1994 1 $ (10,823) 10,305 $ 4,867,823 $ 4,857,000
</TABLE>
See accompanying notes to the financial statements.
<PAGE>
FAR WEST ELECTRIC ENERGY FUND, L.P.
A DELAWARE LIMITED PARTNERSHIP
STATEMENTS OF CASH FLOWS
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
FOR THE YEARS ENDED
DECEMBER 31,
1994 1993
1992
Cash Flows From Operating
Activities:
Net Income (Loss) $ 73,000 $ 702,000
$ 653,000
Adjustments to Net Income (Loss):
Depreciation and Amortization 661,000 716,000
784,000
Write-down of Assets - -
345,000
Gain on Debt Restructure - (175,000)
(1,794,000)
(Increase) Decrease in
Receivables (124,000) (59,000)
94,000
(Increase) Decrease in Prepaid
Insurance - (9,000)
2,000
(Increase) Decrease in Other
Assets 18,000 18,000
-
Increase (Decrease) in Accrued
Liabilities 120,000 (234,000)
188,000
Increase (Decrease) in
Amount Due to General
Partner 100,000 214,000
170,000
Total Adjustments 775,000 471,000
(211,000)
Net Cash Provided by
Operating Activities 848,000 1,173,000
442,000
Cash Flows From Investing
Activities:
Capital Expenditures (139,000) (222,000)
(42,000)
Net Cash Provided by (Used)
in Investing Activities (139,000) (222,000)
(42,000)
<PAGE>
FAR WEST ELECTRIC ENERGY FUND, L.P.
A DELAWARE LIMITED PARTNERSHIP
STATEMENTS OF CASH FLOWS
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
(Continued)
FOR THE YEARS ENDED
DECEMBER 31,
1994 1993
1992
Cash Flows From Financing
Activities:
Principal Payments on Long-
term Debt $ (751,000) $(1,109,000)
$ (947,000)
Proceeds From the Issuance
of Debt 83,000 171,000
350,000
Net Cash Provided by (Used)
in Financing Activities (668,000) (938,000)
(597,000)
Increase (Decrease) in Cash,
Restricted Cash and Cash
Equivalents 41,000 13,000
(197,000)
Cash, Restricted Cash, and
Cash Equivalents at
Beginning of Year 1,382,000 1,369,000
1,566,000
Cash, Restricted Cash, and
Cash Equivalents at
End of Year $ 1,423,000 $ 1,382,000
$ 1,369,000
Supplemental Disclosure of
Cash Flow Information:
Cash Paid During the Year
For Interest $ 727,000 $ 755,000
$ 750,000
Non-Cash Activities:
The Partnership reduced a contract payable for the year ended
December 31, 1993 and 1992 by $13,000 and $187,000, respectively,
and recognized income relating to option payments not made; see
Note 6.
An extraordinary gain of $175,000 and $1,794,000 for the
years
ended December 31, 1993 and 1992, was recognized relating to the
extinguishment and restructuring of debt and accrued interest; see
Note 4.
Notes payable and accrued interest were reduced and other
income recognized for the year ended December 31, 1993 and 1992 in
the amount of $424,000 and $387,000, respectively, relating to
offsets allowed under the performance guaranty on the Steamboat
Springs project; see Note 6.
See accompanying notes to the financial statements.
<PAGE>
FAR WEST ELECTRIC ENERGY FUND, L.P.
A DELAWARE LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The following significant accounting policies are followed by
Far West Electric Energy Fund, L.P. in preparing and presenting the
financial statements, and are to assist the users in understanding
the financial statements.
Organization
Far West Electric Energy Fund, L.P., a Delaware limited
partnership (the Partnership) was organized in 1985 to acquire and
operate electric generating plants.
Utility Plant and Equipment
Utility plants and equipment are carried at cost or adjusted
cost (see Note 2). Fixed assets are depreciated over their
estimated useful life (utility plants - thirty years, equipment -
five to ten years).
Cash Equivalents
For purposes of the statement of cash flows, the
Partnership's policy is that all investments with maturities of
three months or less are considered cash equivalents.
Income Taxes
No provision for income taxes has been made since the
Partnership files partnership return under provisions for federal
and state tax laws. The assets and liabilities of the Partnership
for tax purposes are lower than the financial statements for 1994
by $11,154,000 and $2,208,000, for 1993 by $11,492,000 and
$2,011,000, respectively.
Income Per Limited Partnership Unit
The income before extraordinary item is calculated on the
weighted average units outstanding during the year. The weighted
average of units outstanding during 1994, 1993, and 1992 were
10,305.
Reclassifications
Certain amounts in 1994 and 1993 have been reclassified to
conform with financial statement presentations adopted in 1994.
<PAGE>
FAR WEST ELECTRIC ENERGY FUND, L.P.
A DELAWARE LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
(Continued)
NOTE 2 - UTILITY PLANT
Plant in service consists of the following at December 31,
1994 and 1993:
Estimated
1994 1993 Useful Lives
Steamboat Springs
Thermal Hydroelectric
Power Plant $15,599,000 $15,597,000 30 Years
Expansion Pipeline 400,000 400,000 5 to 7 Years
Crystal Springs
Hydroelectric
Power Plant 4,738,000 4,716,000 30 Years
Valuation Allowance (2,021,000) (2,021,000)
$18,716,000 $18,629,000
The valuation allowance relates to the Crystal Springs
Hydroelectric Power Project. The valuation allowance is a result
of the rights to a purchase option being waived and a decline in
the value of the project.
NOTE 3 - OTHER ASSETS
Other assets consist of the following at December 31, 1994
and 1993:
1994 1993
Loan Origination Fees $183,000 $183,000
Organization Costs 65,000 65,000
Other Assets 35,000 35,000
Accumulated Amortization (159,000) (141,000)
Total Other Assets $124,000 $142,000
The loan origination fees are being amortized on a
straight-line basis over the respective lives of the loans.
Organization costs are amortized over a five year period on a
straight-line basis. Amortization was $18,000, $18,000, $20,000
for the years ended December 31, 1994, 1993, and 1992,
respectively.
<PAGE>
FAR WEST ELECTRIC ENERGY FUND, L.P.
A DELAWARE LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
(Continued)
NOTE 4 - LONG-TERM DEBT
Long-term debt as of December 31, 1994 and 1993 consists of
the following:
1994 1993
Note Payable to a corporation is in
default as of 10/23/92 and is
immediately due and payable. Note is
secured by the Steamboat Springs
Project and all associated rights.
Interest rate is 11.5% $5,340,000 $6,035,000
Note Payable to a bank is due and pay-
able in full originally on December
1, 1994, extended to September 30, 1994
per a restructuring agreement, is in
default. Interest is due in quarterly
installments. Note is secured by Crystal
Springs Project and associated rights.
Interest rate is prime plus 2%, prime
was 6% at year end (See Note 12 - Sub-
sequent Events). 1,800,000 1,800,000
7,140,000 7,857,000
Less Current Installments Due 7,140,000 7,857,000
$ - $ -
The Partnership is required to maintain an escrowed bank
account as security under the terms of the note payable to a
corporation with the note payable balance as of December 31, 1994
of $5,340,000. The reserve account was drawn down to $1,145,000
due to insufficient operating funds to meet principal and interest
payments. The note is in default due to the reserve account being
drawn below required amounts. The reserve includes the initial
deposit of $1,000,000 and requires an additional $70,000 annually
for the first seven years, interest income is also retained in the
reserve account. Disbursements from the reserve account for
principal and interest payments on the note are allowed to the
extent that there are insufficient funds in the Partnership's
operating accounts.
<PAGE>
FAR WEST ELECTRIC ENERGY FUND, L.P.
A DELAWARE LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
(Continued)
NOTE 4 - LONG-TERM DEBT (Continued)
The aggregate maturities of long-term debt for each of the
five years subsequent to December 31, 1994 are as follows:
Year Ending December 31,
1995 $ 7,140,000
1996 -
1997 -
1998 -
1999 -
Thereafter -
$ 7,140,000
A note payable to a corporation was extinguished in the
amount of $175,000 in December 1993. The extinguishment was a
result of negotiations to settle litigation on the performance
guaranty. The principal note amount and related accrued interest
are shown as an extraordinary item in the statement of operations
for the year ended December 31, 1993.
During December 1992, a note payable to a bank was
restructured resulting in a reduction of principal amount, accrued
interest, and a renegotiation of terms. The difference of the
restructured principal and future cash payments and the amount
previously due is shown as an extraordinary item in the statement
of operations for the year ended December 31, 1992 in the amount of
$1,794,000.
Interest payments relating to the reduced note were offset to
accrued interest payable. The total amount offset against accrued
interest payable in 1994 was $26,000.
<PAGE>
FAR WEST ELECTRIC ENERGY FUND, L.P.
A DELAWARE LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
(Continued)
NOTE 5 - NOTE PAYABLE-RELATED PARTY
The Partnership had notes payable to related parties for the
years ended December 31, 1994, and 1993 as follows:
1994 1993
Notes Payable to General Partner
payable on demand, unsecured.
Interest rate is 13% $1,005,000 $ 922,000
Note Payable to 1-A Enterprises,
a partnership, due in quarterly
installments, including interest;
commencing April 16, 1990, re-
maining principal due January 16,
2000; unsecured. Interest rate
is 11% 268,000 302,000
1,273,000 1,224,000
Less Current Installments Due 1,043,000 956,000
$ 230,000 $ 268,000
NOTE 6 - PURCHASE AND OPERATING AGREEMENTS
Steamboat Springs Thermal Hydroelectric Power Plant (Steamboat
Springs)
Under the terms of the Steamboat Springs purchase agreement
(the Agreement), the Partnership is required to pay royalties
aggregating 14.05 percent of annual gross revenues plus an annual
lump sum of $50,000. For the years ended December 31, 1994, 1993,
and 1992, royalty expense related to these commitments amounted to
$410,000, $419,000, and $382,000, respectively.
As part of the Agreement, the original developer of Steamboat
Springs (the Developer) guaranteed annual net operating revenues,
as defined (Net Operating Revenues) of $2,000,000 for a period of
ten years following the date of commissioning, March 31, 1987 (the
Guarantee). In 1992, the debt and related performance guarantee
with the original developer was extinguished. Pursuant to the
Guarantee and included in other revenues in the statements of
income for the years ended December 31, 1993, and 1992 are
$424,000, and $387,000, respectively. Amounts due to the
Partnership under the Guarantee are offset annually against a note <PAGE>
FAR WEST ELECTRIC ENERGY FUND, L.P.
A DELAWARE LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
(Continued)
NOTE 6 - PURCHASE AND OPERATING AGREEMENTS (Continued)
payable to the Developer, and the corporation which subsequently
sold the project to the Partnership. The note payable to the
developer has been fully offset as of December 31, 1993.
The Partnership is also required to pay the Developer annual
royalties equal to 50 percent of the first $100,000 over the
guaranteed Net Operating Revenues and 75 percent of amounts in
excess of the $100,000 each year for the first ten years following
the date of commissioning. For years 11 through 20 after
commissioning, the royalty equals 30 percent of Net Operating
Revenues; principal debt service payments incurred to finance
construction or operations are not deducted in determining the
revised net operating revenues (Revised Net Operating Revenues).
For years 21 inclusive and thereafter, the royalty is equal to 50
percent of Revised Net Operating Revenues. No royalties have been
paid pursuant with this commitment.
Crystal Springs Hydroelectric Company
The Partnership owns the entire beneficial interest of the
partnership units of Crystal Springs Hydroelectric Company (an
Idaho Limited Partnership) (the Company). The Company owns the
Crystal Springs Hydroelectric Plant (the Project). The Company
purchased the Project from its operator (the Operator). Under the
terms of the original purchase agreement, the Company was required
to pay the Operator royalties equaling 20 percent of gross annual
revenues and the Operator received an option to purchase the
Project from the Company 30 days prior to May 14, 2020 for $1. On
July 7, 1988, effective October 1987, the Partnership issued the
Operator a purchase option (the Option) to either purchase the
Partnership's interest in the Project or Company. As consideration
for the Option, the Operator waived rights to the previous purchase
option, paid the Partnership cash of $150,000, forgave $998,000 in
debt obligations, and agreed to make annual cash payments of
$187,000 until the Option is exercised or expires. The quarterly
option payment was not made for the period ending December 31,
1992, thereby waiving the option. Per the contract agreement
option payments not made were offset against an original contract
amount of $200,000, resulting in a reduction of $13,000, and
$187,000 which is shown as miscellaneous income in the statements
of income for the year ended December 31, 1993 and 1992,
respectively. Previous option payments received by the Partnership
had been recorded as deferred revenue.<PAGE>
FAR WEST ELECTRIC ENERGY FUND, L.P.
A DELAWARE LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
(Continued)
NOTE 6 - PURCHASE AND OPERATING AGREEMENTS (Continued)
Prior to December 1, 1992, the Company restated the operating
agreement for the Project with the Operator effective October 1987.
Under the terms of the operating agreement, the Operator staffs and
operates the Project, pays operating expenses (excluding insurance
and taxes), and pays debt service payments related to the Project.
In view of the limited participation of the Company in operations,
including profits and losses, except as described elsewhere herein,
operations of the Project are not included in the financial
statements for the years ended December 31, 1992, and 1991. The
net cost of the utility plant of the Project, related long-term
debt and depreciation, interest, insurance, and tax expenses are
included in the financial statements of the Partnership. For the
year ended December 31, 1991, debt service payments from the
Operator of $339,000, are included in other revenues. The Operator
did not make any debt service payments in 1992.
The debt service was restructured in December 1992 and will
beserviced out of revenues of the project. The restructuring
agreement with the bank changed the terms of the note payable (see
Note 4). Also, any excess cash flows from the Project are to be
used by the bank to offset the prior reduction of debt. As a
result of the restructuring agreement, the Partnership now oversees
the Project. The revenues and expenses of the Project are
reflected in the statement of operations for the year ended
December 31, 1994.
The Partnership entered into an agreement, effective December
1, 1992 with Little Mac Power Services Co. for the operation and
maintenance of the Crystal Springs Hydroelectric Project. Under
the terms of the operating agreement, the operator staffs and
operates the Project, pays operating expenses to maintain the
highest available plant efficiency. The Partnership pays a monthly
fee of $2,200 to cover salary, travel and expenses. An initial
non-refundable start-up cost of $2,500 was paid at the time the
agreement was executed. The monthly fee will increase by 4%
annually if contract continues for longer than one year.
Under the terms of the Crystal Springs purchase agreement
dated May 15, 1985, the Partnership is required to pay royalties
aggregating 20 percent of gross revenue received from the sale of
Hydroelectric Power of which 17 percent is subordinated to debt.
An additional five percent is payable to Twin Falls Canal Company
per an agreement dated March 8, 1993.
<PAGE>
FAR WEST ELECTRIC ENERGY FUND, L.P.
A DELAWARE LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
(Continued)
NOTE 7 - RELATED PARTY TRANSACTIONS
Under the terms of the Partnership agreement, the general
partner is allowed various fees and reimbursements of expenses
incurred to manage the Partnership. For each of the years in the
three-year period ended December 31, 1994, the Partnership expensed
the following amounts as cost reimbursements to the general
partner:
1994 1993 1992
General and Administrative
Expenses $123,000 $223,000 $437,000
In addition, during the years ended December 31, 1993 and
1992, the Partnership paid $3,300 and $18,000 to a Utah partnership
for private air transportation, in the ordinary course of business,
in lieu of commercial airfare. The general partners are partners
of the Utah Partnership.
As a term of the amended and restated Partnership agreement,
the general partner is entitled to 5 percent of the limited
partnership units (Units) as compensation.
During 1988, the Partnership assigned their rights to build
an expansion unit to Steamboat Springs to a Nevada general
partnership. As consideration for the rights, the Nevada general
partnership deeded the Partnership rights and title to piping and
valves installed from Steamboat Springs to the expansion unit and
agreed to pay the Partnership royalties equaling 10 percent of net
operating income from the expansion for the years ended December
31, 1988 through 1992, 15 percent for 1993 through 1998, 40 percent
for 1999 through 2010, 45 percent thereafter, and an annual pumping
charge. Included in other revenues in the statement of operations
for the years ended December 31, 1994, 1993 and 1992, are $144,000,
$135,000, and $102,000, respectively related to this agreement.
As of December 31, 1994 and 1993, two of the general partners held
a 75 percent ownership in the Nevada general partnership.
During 1991, the Partnership assigned its 77% ownership in SB
Geo, Inc. a Utah Corporation, to two of the general partners. SB
Geo, Inc. operates the Partnership's Steamboat Springs Thermal
Hydroelectric Power Plant and a related expansion unit. At the
time of the transfer, SB Geo, Inc. had no assets and operated on a
cost reimbursement basis. No gain or loss was recognized as a
result of the assignment.
<PAGE>
FAR WEST ELECTRIC ENERGY FUND, L.P.
A DELAWARE LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
(Continued)
NOTE 8 - MAJOR CUSTOMER
The Partnership has contracted with Sierra Pacific Power
Company to sell electric energy from Steamboat Springs for a term
of 20 years. The contract entitles the Partnership to a rate of
71.7 mills per kilowatt hour for the first 10 years and a variable
amount related to the short-term cost of power to Sierra Pacific
Power Company for the second 10 years. Sales to Sierra Pacific
Power Company account for 100 percent of electric power sales. The
Partnership is dependent upon this customer for the purchase of all
electricity generated from this power plant.
The partnership has contracted with Idaho Power Company to
sell electric energy from Crystal Springs for a term of 35 years.
The contract entitles the Partnership to a base payment rate as
determined by seasonal water flows plus an adjustable component
pursuant to commission order. Sales to Idaho Power Company account
for 100 percent of electric power sales. The Partnership is
dependent upon this customer for purchase of all electricity
generated from this power plant.
NOTE 9 - LITIGATION
Ormat Arbitration
The arbitrators have made their award regarding the
lawsuitagainst Ormat alleging breach of contract on the Steamboat
Springs project and Ormat's counter-suit regarding the cancellation
of the operating agreement. The Partnership was awarded $188,000
in damages including a portion of the previously restricted cash.
Ormat was awarded $255,000 for past fixed operating fees, which the
majority had been held in an escrow account.
Subsequent to the arbitrators award the Partnership and Ormat
reached an additional agreement which cancels the note payable to
Ormat which was previously offset by the performance guaranty.
Bonneville Pacific Corporation Bankruptcy
The Partnership has filed a claim in the Chapter 11 filing of
Bonneville Pacific Corporation. The claim relates to fraud claims
and other transactions on the Crystal Springs project.
<PAGE>
FAR WEST ELECTRIC ENERGY FUND, L.P.
A DELAWARE LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
(Continued)
NOTE 9 - LITIGATION
General
The Partnership is involved in various other claims and legal
actions arising in the ordinary course of business. In the
opinionof the general partner, these matters will not have a
material adverse effect on the Partnership's financial position.
NOTE 10 - NOTE DEFAULTS
The Partnership received a notice of default as of 10/23/92
on a note to a bank. The balance as of December 31, 1994 and 1993
was $5,340,000, and $6,035,000, respectively. Under the terms of
the note all principal and interest is immediately due and payable.
The note is secured by the Steamboat Springs project and related
revenues and other assets.
The Partnership is in default on a note payable to a bank as
of 9/30/94. The balance as of December 31, 1994 and 1993 was
$1,800,000. Due to events occurring subsequent to December 31,
1994, this note will be reduced to $537,000 (see Note 12).
NOTE 11 - LIQUIDITY
As shown in the accompanying financial statements for the
year ended December 31, 1994, current liabilities exceeded current
assets by $9,191,000. Of this amount $7,140,000 relates to the
note defaults described in Note 10.
NOTE 12 - SUBSEQUENT EVENTS
Steamboat Springs Project
The Partnership is investigating the possibility of selling
the Steamboat Springs Project. At this time, there has been no
formal discussion.
Crystal Springs Project
The Partnership signed an agreement dated February 28, 1995
to sell the Crystal Springs project. The assets to be sold are
valued at $2,717,000 with accumulated depreciation of $1,245,000
for a basis of $1,472,000. Assets to be sold:
<PAGE>
FAR WEST ELECTRIC ENERGY FUND, L.P.
A DELAWARE LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
(Continued)
NOTE 12 - SUBSEQUENT EVENTS (Continued)
Crystal Plant $4,500,000
Additional costs 216,000
Valuation Allowance (see Note 2) (2,021,000)
Unit Overhauls 22,000
2,717,000
Less: Accumulated Depreciation 1,245,000
$1,472,000
In consideration for the assets sold; a note Payable to First
Security Bank, which is secured by the assets, will be reduced by
$1,263,000, interest payable of $133,000 will be made current, and
royalties payable of $120,000 will be made current bringing total
sales proceeds to $1,516,000. Total proceeds of $1,516,000 less
basis of the assets of $1,472,000 provides for a gain on sale of
$44,000.
The note payable will be amended as follows:
Upon receipt of First Security (Lender) of a principle
payment on the loan in the amount of $1,100,000, the note
shall be modified to provide that the remaining principle
balance owed shall be $537,000 and interest and costs on
the loan shall be deemed current.
If the note is paid in full within two years after the
payment of $1,100,000, the Lender will discount the
amount of the principle due by $100,000 (requiring a
principle payment of only $437,000), and if paid within
three years, the Lender will discount the amount of the
principle due by $50,000 (requiring a principle payment
of only $487,000). There will be no discount if paid
after the third anniversary.
The following pro forma balance sheet and statement of
operations give effect to the above events as if they had occurred
on January 1, 1994:
<PAGE>
FAR WEST ELECTRIC ENERGY FUND, L.P.
A DELAWARE LIMITED PARTNERSHIP
DECEMBER 31, 1994
NOTES TO FINANCIAL STATEMENTS
(Continued)
NOTE 12 - SUBSEQUENT EVENTS (Continued)
PRO FORMA BALANCE SHEETS
As Reported Pro Forma
in Adjustments
Accompanying For Pro Forma
Financial Subsequent Balance
Statements Events Sheet
ASSETS
Utility Plant:
Plant in Service $18,716,000 $(2,717,000) A $15,999,000
Equipment 335,000 - 335,000
Construction in Progress 118,000 - 118,000
Accumulated Depreciation (6,010,000) 1,245,000 A (4,765,000)
Net Utility Plant 13,159,000 (1,472,000) 11,687,000
Restricted Marketable
Securities 1,145,000 - 1,145,000
Other Assets 124,000 - 124,000
Current Assets:
Cash 278,000 - 278,000
Receivables - Trade 437,000 (1,000) B 436,000
Receivables - Other 6,000 - 6,000
Receivables - Related Party 159,000 - 159,000
Prepaid Insurance 12,000 (9,000) C 3,000
Total Current Assets 892,000 (10,000) 882,000
Total Assets $15,320,000 $(1,482,000) $13,838,000
A - All assets of Crystal Spring Project are to be sold per sales
agreement date
February 28, 1995.
B - Receivables attributable to Crystal Springs Project.
C - Prepaid Insurance attributable to Crystal Springs Project.
<PAGE>
FAR WEST ELECTRIC ENERGY FUND, L.P.
A DELAWARE LIMITED PARTNERSHIP
DECEMBER 31, 1994
NOTES TO FINANCIAL STATEMENTS
(Continued)
NOTE 12 - SUBSEQUENT EVENTS (Continued)
PRO FORMA BALANCE SHEETS
As Reported Pro Forma
in Adjustments
Accompanying For Pro Forma
Financial Subsequent Balance
Statements Events Sheet
PARTNERS' CAPITAL & LIABILITIES
Partners' Capital $ 4,857,000 $ 34,000 D $4,891,000
Other Liabilities 150,000 - 150,000
Long-term Debt:
Notes Payable - Related Party 230,000 - 230,000
Partners' Capital & Long-term
Liabilities 5,237,000 34,000 5,271,000
Current Liabilities:
Current Portion - Long-term
Debt 7,140,000 (1,263,000) E 5,877,000
Note Payable - Related Party 1,043,000 - 1,043,000
Payable - Related Party 573,000 - 573,000
Accrued Liabilities:
Operations 495,000 - 495,000
Royalties 220,000 (120,000) F 100,000
Interest 612,000 (133,000) G 479,000
Total Current Liabilities 10,083,000 (1,516,000) 8,567,000
Total Partners' Capital
and Liabilities $15,320,000 $(1,482,000) $13,838,000
D - Net income from Crystal Springs project allocated to partners.
E - Long-term debt attributable to Crystal Springs project.
F - Royalties payable attributable to Crystal Springs project.
G - Interest payable attributable to Crystal Springs project.
<PAGE>
FAR WEST ELECTRIC ENERGY FUND, L.P.
A DELAWARE LIMITED PARTNERSHIP
DECEMBER 31, 1994
NOTES TO FINANCIAL STATEMENTS
(Continued)
NOTE 12 - SUBSEQUENT EVENTS (Continued)
PRO FORMA STATEMENT OF OPERATIONS
As Reported Pro Forma
in Adjustments
Accompanying For Pro Forma
Financial Subsequent Statement of
Statements Events Operations
REVENUES
Electric Power Sales $ 2,728,000 $ (163,000) H $2,565,000
Other Revenues 151,000 - 151,000
Total Revenues 2,879,000 (163,000) 2,716,000
EXPENSES
Interest 902,000 (95,000) I 807,000
Depreciation 643,000 (67,000) I 576,000
Royalty 451,000 (41,000) I 410,000
Professional Services 54,000 (25,000) I 29,000
Administrative Services -
General Partner 123,000 (54,000) I 69,000
Amortization 18,000 - 18,000
Insurance 52,000 (18,000) I 34,000
Maintenance 436,000 (28,000) I 408,000
Taxes 47,000 (14,000) I 33,000
Other 80,000 (20,000) I 60,000
Total Expenses 2,806,000 (362,000) 2,444,000
Net Income (Loss)
Before Gain on Sale 73,000 199,000 272,000
Gain on Sale of Crystal
Springs Project - 44,000 J 44,000
Net Income (Loss) $ 73,000 $ 243,000 $ 316,000
Net Income (Loss) Per
Limited Partnership Unit $ 7 $ 24 $ 31
H - Electric power sales attributable to Crystal Springs Project.
I - Operating expenses attributable to Crystal Springs Project.
J - Gain on sale of Crystal Springs Project.
<PAGE>
Item 9. Changes in and Disagreements With Accountants on
Accounting and Financial Disclosure.
None
PART III
Item 10. Directors and Executive Officers of the Registrant.
The Partnership has no executive officers. Its
business affairs are managed by its General Partner,
Far West Capital, and, until they resigned as General
Partners effective January 1, 1995, the following
individuals, who are also 90% shareholders of Far West
Capital:
ALAN O. MELCHIOR, President and Director of Far West
Capital, age 47. Mr. Melchior was a founder of Far West
Capital, which was organized in May, 1983. He has been its
President since its inception. From December, 1981 to May,
1983, he was an account executive with Westlake Securities,
Inc., of Angora Hills, California. Mr. Melchior received a
B.S. in business from Brigham Young University in 1971 and an
M.B.A. degree from the University of Utah in 1974.
THOMAS A. QUINN, Vice President, General Counsel and
Director of Far West Capital, age 59. Mr. Quinn was also a
founder of Far West Capital. Since February, 1985, Mr. Quinn
has been serving full-time in his capacities with Far West
Capital. From 1968 to February, 1985, he was engaged in the
private practice of law in Salt Lake City, Utah. He received
a B.S. degree in political science from Brigham Young
University in 1959, and a Juris Doctor, with honors, from
George Washington University Law School in 1963.
On January 29, 1993, a Final Judgment of Permanent Injunction
("Injunction") was entered by the United States District Court,
District of Utah, Central Division, restraining and enjoining the
Partnership, Far West Capital, Inc. and Alan O. Melchior,
previously a general partner until his resignation effective
January 1, 1995, from violating provisions of the Securities Act of
1933. A copy of the Injunction is appended as an exhibit to Form
8-K dated January 29, 1993.
The action filed against the Partnership, Far West Capital,
Inc., Alan O. Melchior, previously a General Partner until his
resignation effective January 1, 1995, and others on December 7,
1992 by the Arizona Corporation Commission and reported in the
December 31, 1992 Form 10-K and the December 31, 1993 Form 10-K has
been settled pursuant to a cease and desist order without any
expense to the Partnership.<PAGE>
Item 11. Executive Compensation.
Pursuant to the Amended and Restated Agreement of
Limited Partnership of Far West Electric Energy Fund, L.P.,
as consideration for providing management services to the
Partnership, the General Partner is entitled to the following
compensation: (i) a one percent (1%) interest in the profits,
losses, and net income of the Partnership; (ii) Units equal
to five percent (5%) of the Units outstanding, to be
increased proportionately if and as additional Units are
issued in the future; (iii) if and when Units are listed for
public trading, or the Limited Partners have received an
amount equal to their capital contributions to the
Partnership (reduced by the amount of tax credits allocated
to the Limited Partners) together with a sum equal to a
cumulative annual return of 8%, the General Partner shall
receive additional Units equal to ten percent (10%) of the
Units outstanding, and a total of 15% of any new Units
issued. The General Partner may receive compensation in
connection with the purchase of projects from the General
Partner or its affiliates, and provision of services to the
Partnership which are normally provided by outside
consultants, provided any such payments are competitive with
charges for similar projects or services.
Following the reorganization of the Partnership in
Delaware, Units equal to 5% of the Units outstanding were
issued to the General Partner, together with a certificate
evidencing a one percent (1%) General Partner's interest in
the Partnership.
The Partnership has no employees and therefore relies
on the personnel of Far West Capital and contracts with
others to perform needed management operating and
professional services. Far West Capital provides services on
an hourly basis at rates competitive with third party
sources.
Far West Capital is also entitled to be reimbursed on
a monthly basis for all direct expenses it incurs on behalf
of the Partnership and for that portion of its administrative
expenses allocable to the Partnership.
For the years ended December 31, 1994, December 31,
1993 and December 31, 1992 Far West Capital was entitled to
receive $123,000, $223,000 and $437,000 respectively as
reimbursement for allocable administrative costs and services
rendered and direct expenses in connection with the above
matters. During 1994 the Partnership paid $16,000 toward
these amounts, leaving the amount of $573,000 still due to
Far West Capital.
Item 12. Security Ownership of Certain Beneficial Owners and
Management.
Security Ownership of Certain Beneficial Owners
The Partnership is not aware of any beneficial owner of
more than five percent interest in the Partnership other than
the General Partner. The General Partner owns 5.14% of the
Partnership in Limited Partnership Units and a 1% General
Partner interest.
Security Ownership of Management
As of March 16, 1995 the General Partner owns the
following interest in the Partnership:
Name of
Title of Class Beneficial Owner Ownership %
Limited Partner- Far West Capital 530 5.14%
ship Units Limited
Partnership
Units
General Partner Far West Capital Certificate
Interest of General
Partner's
Interest 1%
Item 13. Certain Relationships and Related Transactions.
General Partner's Compensation and Reimbursement
Far West Capital is entitled to receive certain
compensation and reimbursement under the terms of the Amended
and Restated Partnership Agreement. See "Item 11. Executive
Compensation" as to amounts paid to the General Partner in
1994.
1-A Expansion to the Steamboat Springs Plant
In 1988 the Partnership sold rights to develop the 1-A
Expansion Project to the Steamboat Springs Project to an
entity owned mostly by Alan O. Melchior and Thomas A. Quinn,
officers and owners of the General Partner of the
Partnership. For a discussion of the Partnership's interest
in this Project, see "Item 2. Properties -- Revenues from
the 1-A thermal- hydroelectric Plant."
As consideration for the sale of the 1-A Plant rights to
1-A Enterprises, the Partnership received a royalty interest
in the net operating income of the 1-A Plant. Such royalties
equaled 15% in 1994. This amounted to $87,000 earned by the
Partnership.
In addition the Partnership is paid an amount
equivalent to the net profit that would be realized by the
Partnership if the 1-A Plant were bearing 150 KW of parasitic
power load (power consumed by the Plant itself). In 1994
this amounted to $57,000 received by the Partnership.
$400,000 Loan
Simultaneous with its January 17, 1990 loan to the
Partnership, Westinghouse made a $3,000,000 non-recourse loan
to 1-A Enterprises on the 1-A Plant on the same terms as the
loan made to the Partnership but secured by the assets
associated with the 1-A Plant. $400,000 of the loan on the
1-A Plant has been reloaned by 1-A Enterprises to the
Partnership at 11% per annum for ten years on a non-recourse
basis.
Assignment of Ownership Interest in SB GEO
In October, 1991 the Partnership assigned its 77%
ownership interest in SB GEO to Alan O. Melchior and Thomas
A. Quinn, two of the officers and owners of the General
Partner in exchange for their assuming all outstanding
liabilities of SB GEO. See "Item 2. Properties" for further
information.
Loans From General Partner
During the past 5 years the General Partner made unsecured
loans to the Partnership to help the Partnership meet its financial
obligations. The loans accrue interest at 13% and are payable upon
demand. As of December 31, 1994, 1993 and 1992 loans from General
Partners totaled $1,005,000, $922,000 and $751,000 respectively. <PAGE>
PART IV
Item 14. Exhibits, Financial Statement Schedules, and Reports on
Form 10-K.
(a) 1. The following financial statements are included in Part
II, Item 8;
Page
Independent Auditors' Report 17
Financial Statements:
Balance Sheets, December 31, 1994 and 1993 18
Statements of Operations, Years ended 20
December 31, 1994, 1993, and 1992
Statements of Partners' Capital, Years ended 21
December 31, 1994, 1993, and 1992
Statements of Cash Flows, Years ended 22
December 31, 1994, 1993, and 1992
Notes to Financial Statements 24
2. The following financial schedules for the period from
January 1, 1993, to December 31, 1994,
are submitted herewith.
All schedules are omitted because they are not
applicable or the required information is shown in the
financial statements or notes thereto.
3. Exhibits:
(3) (a) Certificate and Agreement of Limited Partner-
ship of Far West Electric Energy Fund, L.P.
filed with the Delaware Secretary of State on
December 20, 1988 (Steamboat Springs
Project). (Incorporated by reference to
Exhibit 10(ab) filed with Form 10-K for the
fiscal year ended December 31, 1988.)
(b) Amendment to Certificate and Agreement of
Limited Partnership of Far West Electric
Energy Fund, L.P.
(4) See Exhibit (3)(a) with respect to rights of
Limited Partners.
(10) (a) Purchase Agreement (Steamboat Springs--
formerly "Sierra Pacific"--Project).
(Incorporated by reference to Exhibit 10(a)
filed with Form 8 dated June 20, 1986.)
(b) Offset Agreement (Steamboat Springs Project).
(Incorporated by reference to Exhibit 10(b)
filed with Form 8, dated June 20, 1986.)
(c) Agreement for the Purchase and Sale of
Electricity (Steamboat Springs Project).
(Incorporated by reference to Exhibit 10(c)
filed with Form 8 dated June 20, 1986.)
(d) Memorandum of Lease, Assignment of Lease, and
Purchase Agreement (Steamboat Springs
Project). (Incorporated by reference to
Exhibit 10(d) filed with Form 8 dated June 20,
1986.)
(e) Operating Agreement (Steamboat Springs
Project). (Incorporated by reference to
Exhibit 10(e) filed with Form 8 dated June 20,
1986.)
(f) Demand Note (Steamboat Springs Project).
(Incorporated by reference to Exhibit 10(f)
filed with Form 8 dated June 20, 1986.)
(g) Assignment and Security Agreement (Steamboat
Springs Project). (Incorporated by reference
to Exhibit 10(g) filed with Form 8 dated June
20, 1986.)
(h) Accommodation Agreement (Steamboat Springs
Project). (Incorporated by reference to
Exhibit 10(h) filed with Form 8 dated June 20,
1986.)
(i) Leasehold Trust Deed (Steamboat Springs
Project). (Incorporated by reference to
Exhibit 10(i) filed with Form 8 dated June 20,
1986.)
(j) Construction Loan Agreement (Steamboat Springs
Project). (Incorporated by reference to
Exhibit 10(j) filed with Form 8 dated June 20,
1986.)
(k) Consents to Assignment of Geothermal Resources
Lease and Agreement for the Purchase and Sale
of Electricity (Steamboat Springs Project).
(Incorporated by reference to Exhibit 10(k)
filed with Form 8 dated June 20, 1986.)
(l) Construction Agreement (Steamboat Springs
Project). (Incorporated by reference to
Exhibit 10(l) filed with Form 8 dated June 20,
1986.)
(m) Assignment of Construction Agreement
(Steamboat Springs Project). (Incorporated by
reference to Exhibit 10(m) filed with Form 8
dated June 20, 1986.)
(n) Promissory Note ($7.1 Million) (Steamboat
Springs Project). (Incorporated by reference
to Exhibit 10(n) filed with Form 8 dated June
20, 1986.)
(o) Purchase Agreement (Steamboat Springs
Project). (Incorporated by reference to
Exhibit 10(o) filed with Form 8 dated June 20,
1986.)
(p) Amendment to Agreement for Purchase and Sale
of Electricity Between Far West Hydroelectric
Fund, Ltd. and Sierra Pacific Power Company
(Steamboat Springs Project). (Incorporated by
reference to Exhibit 10(p) filed with Form 10-
K for the fiscal year ended December 31,
1986.)
(q) Location and Occupancy Agreement (Steamboat
Springs Project). (Incorporated by reference
to Exhibit 10(q) filed with Form 10-K for the
fiscal year ended December 31, 1986.)
(r) Insurance Policy (Steamboat Springs Project).
(Incorporated by reference to Exhibit 10(r)
filed with Form 10-K for the fiscal year ended
December 31, 1986.)
(s) Insurance Policy (Crystal Springs Project).
(Incorporated by reference to Exhibit 10(s)
filed with Form 10-K for the fiscal year ended
December 31, 1986.)
(t) Certificate of Insurance (Crystal Springs
Project). (Incorporated by reference to
Exhibit 10(t) filed with Form 10-K for the
fiscal year ended December 31, 1986.)
(u) Memorandum of Agreement Regarding Crystal
Springs Lease (Crystal Springs Project).
(Incorporated by reference to Exhibit 6.(a)(1)
filed with Form 10-Q for the quarter ended
September 30, 1987.)
(v) Steamboat Springs Geothermal Hydroelectric
Plant Loan Agreement and Security Agreement
(Steamboat Springs Project). (Incorporated by
reference to Exhibit 6.(a)(2) filed with Form
10-Q for the quarter ended September 30,
1987.)
(w) Letter of Intent to Purchase Steamboat Springs
1-A Project (Steamboat Springs Project).
(Incorporated by reference to Exhibit 6.(a)(1)
filed with Form 10-Q for the quarter ended
June 30, 1987.)
(x) Restated Operation and Maintenance Agreement,
Purchase Option Agreement, Promissory Note,
Credit Agreement, Security Agreement,
Mortgage, Assignment of Contract Rights, and
Security Agreement, and Collateral Assignment
of Water Rights (Steamboat Springs Project).
(Incorporated by reference to Exhibits filed
with Form 10-Q for the quarter ended June 30,
1988.)
(y) Amendment to Steamboat Springs Geothermal
Hydroelectric Plant Security Agreement
(Steamboat Springs Project). (Incorporated by
reference to Exhibit 6.(a)(1) filed with Form
10-Q for the quarter ended September 30,
1988.)
(z) Agreement re Acquisition of 1-A Expansion to
the Steamboat Nevada Geothermal Power Plant
(Steamboat Springs Project). (Incorporated by
reference to Exhibit 10(w) filed with Form 10-
K for the fiscal year ended December 31,
1987.)
(aa) 1-A Assignment to the Partnership of Piping
and Valves necessary to carry Geothermal
fluids to and from the Steamboat Springs
Geothermal power plants to the 1-A Expansion
Facility, dated January 18, 1989 (Steamboat
Springs Project). (Incorporated by reference
to Exhibit 10(ac) filed with Form 10-K for the
fiscal year ended December 31, 1988.)
(ab) Second Amendment to Geothermal Resources Lease
between Sierra Pacific Power Company and Far
West Hydroelectric Fund, Ltd., dated October
29, 1988 (Steamboat Springs Project). (Incor-
porated by reference to Exhibit 10(ad) filed
with Form 10-K for the fiscal year ended
December 31, 1988.)
(ac) Geothermal Resources Sublease between Far West
Hydroelectric Fund, Ltd. and Far West Capital,
Inc., dated October 28, 1988 (Steamboat
Springs Project). (Incorporated by reference
to Exhibit 10(ae) filed with Form 10-K for the
fiscal year ended December 31, 1988.)
(ad) Purchase Option Agreement between Crystal
Springs Hydroelectric Company and BPC, dated
July 7, 1988 (Crystal Springs Project).
(Incorporated by reference to Exhibit 19(a)
filed with Form 10-K for the fiscal year ended
December 31, 1988.)
(ae) Restated Operation and Maintenance Agreement
between Crystal Springs Hydroelectric Company
and BPC, dated July 7, 1988 (Crystal Springs
Project). (Incorporated by reference to
Exhibit 19(b) filed with Form 10-K for the
fiscal year ended December 31, 1988.)
(af) Term Loan Agreement with Westinghouse Credit
Corporation dated December 28, 1989 (Steamboat
Springs Project). Incorporated by reference
to Exhibit 7.(c)(1) filed with Form 8-K dated
January 17, 1990.)
(ag) Note in the principal amount of $400,000 to 1-
A Enterprises (Steamboat Springs Project).
(Incorporated by reference to Exhibit 7.(c)(2)
filed with Form 8-K dated January 17, 1990.)
(ah) The following Exhibits relate to the
Westinghouse Loan financing on the Steamboat
Springs Project:
1. Promissory Note.
2. Leasehold Trust Deed and Security
Agreement.
3. Security Agreement.
4. Collateral Assignment.
5. Financing Statement.
6. Escrow Agreement.
7. Escrow Instructions.
8. Consent to Assignment and Agreement of
Sierra Pacific Power Company.
(Incorporated by reference to Exhibit
(19) (ah) filed with Form 10-K for the
fiscal year ended December 31, 1989.)
(ai) Third Amendment to Geothermal Resources Lease
(Steamboat Springs Project). (Incorporated by
reference to Exhibit (10) (ai) filed with Form
10-K for the fiscal year ended December 31,
1989.)
(aj) Amended Memorandum of Lease (Steamboat Springs
Project). (Incorporated by reference to
Exhibit 10-K for the fiscal year ended
December 31, 1989.)
(ak) Revised and Restated Geothermal Resources Sub-
lease (Steamboat Springs Project).
(Incorporated by reference to Exhibit (10)
(ak) filed with Form 10-K for the fiscal year
ended December 31, 1989.)
(al) Memorandum of Revised and Restated Geothermal
Resources Sublease (Steamboat Springs
Project). (Incorporated by reference to
Exhibit (10) (al) filed with Form 10-K for the
fiscal year ended December 31, 1989.)
(am) Amendment to Operating Agreement (Steamboat
Springs Project). (Incorporated by reference
to Exhibit (10) (am) filed with Form 10-K for
the fiscal year ended December 31, 1989.)
(an) Compromise Agreement (Steamboat Springs
Project). (Incorporated by reference to
Exhibit (10) (an) filed with Form 10-K for the
fiscal year ended December 31, 1989.)
(ao) Agreement Re Disputed Invoice and Interest Due
Under Steamboat 1 Operating Agreement
(Steamboat Springs Project). (Incorporated by
reference to Exhibit (10) (ao) filed with Form
10-K for the fiscal year ended December 31,
1989.)
(ap) Agreement for Services (Steamboat Springs).
(Incorporated by reference to Exhibit 10 filed
with Form 10-Q for the quarter ended June 10,
1990.)
(aq) Revised Agreement for Services (Steamboat
Springs). (Incorporated by reference to
Exhibit 10 (a) filed with Form 10-Q for the
quarter ended June 30, 1990.)
(ar) Revised Operating Agreement (Steamboat
Springs). (Incorporated by reference to
Exhibit 10 (b) filed with Form 10-Q for the
quarter ended June 31, 1990.)
(as) Waiver Operating Agreement (Steamboat
Springs). (Incorporated by reference to
Exhibit 10(b) filed with Form 10-Q for the
quarter ended June 30, 1990.)
(at) First Amendment to collateral Assignment
(Steamboat Springs). (Incorporated by
reference to Exhibit (10) (qt) filed with Form
10-K for the fiscal year ended December 31,
1990.)
(au) First Amendment to Security Agreement
Steamamboat Springs). (Incorporated by
reference to Exhibit (10) (au) filed with Form
10-K for the fiscal year ended December 31,
1990.)
(av) Fifth Amendment to Escrow Agreement
(Steamboat Springs). (Incorporated by
reference to Exhibit (10) (av) filed with Form
10-K for the fiscal year ended December 31,
1990.)
(aw) Assignment of Ownership (Steamboat Springs).
(Incorporated by reference to Exhibit
(10)(aw) filed with Form 10-K for the fiscal
year ended December 31, 1991).
(ax) Crystal Springs Agreement (Crystal Springs
Project). (Incorporated by reference to
Exhibit (10)(a) filed with Form 10-Q for the
quarter ended June 30, 1992).
(ay) Award of Arbitrators (Steamboat Springs
Project). (Incorporated by reference to
Exhibit (10)(a) filed with Form 10-Q for the
quarter ended September 30, 1992).
(az) Agreement (Crystal Springs Project).
(Incorporated by reference to Exhibit (10) (a)
filed with Form 10-K for the fiscal year ended
December 31, 1992).
(aaa) Mutual Release Agreement (Crystal Springs
Project). (Incorporated by reference to
Exhibit (10) (a) filed with Form 10-K for the
fiscal year ended December 31, 1992).
(aab) Extension and Modification Agreement (Crystal
Springs Project). (Incorporated by reference
to Exhibit (10) (a) filed with Form 10-K for
the fiscal year ended December 31, 1992).
(aac) Amendment to Mortgage (Crystal Springs
Project). (Incorporated by reference to
Exhibit (10) (a) filed with Form 10-K for the
fiscal year ended December 31, 1992).
(aad) Amendment to Security Agreement (Crystal
Springs Project). (Incorporated by reference
to Exhibit (10) (a) filed with Form 10-K for
the fiscal year ended December 31, 1992).
(aae) Operation and Maintenance Agreement (Crystal
Springs Project). (Incorporated by reference
to Exhibit (10) (a) filed with Form 10-K for
the fiscal year ended December 31, 1992).
(aaf) Mutual Satisfaction of Arbitration Award
(Steamboat Springs Project). (Incorporated by
reference to Exhibit (10) (a) filed with Form
10-K for the fiscal year ended December 31,
1992).
(aag) Second Extension Agreement (Crystal Springs
Project).
(aah) Agreement (Crystal Springs Project).
(aai) Purchase and Sale Agreement (Crystal Springs
Project).
(aaj) Bill of Sale (Crystal Springs Project).
(aak) Release of All Claims (by Lessor) (Crystal
Springs Project).
(aal) Consent to Assignment (Crystal Springs
Project).
(aam) Consent and Agreement (Crystal Springs
Project).
(aan) Assignment of Interest (Crystal Springs
Project).
(aao) Certificate As To Fulfillment of Crystal
Springs Hydroelectric Company ("Seller") and
Obligations (Crystal Springs Project).
(aap) Certificate As To Fulfillment of Crystal
Springs Hydroelectric, L.P. ("Purchaser")
Conditions (Crystal Springs Project).
(aaq) Release of all claims (by Crystal Springs
Hydroelectric Company) (Crystal Springs
Project).
(aar) Release of Security Agreement (Crystal Springs
Project).
(aas) Third Extension and Modification Agreement
(Crystal Springs Project).
(aat) Amended and Substituted Promissory Note
(Crystal Springs Project).
(23) (a) Consent of Independent Public Accountants (Robison Hill
and Company).
The Partnership agrees to furnish to the Securities and
Exchange Commission a copy of any long-term debt instrument or loan
agreement that it may request.
(b) No reports on Form 8-K were filed during the 4th
Quarter of 1994.
(c) The exhibits listed in Item 14(a)(3) are
incorporated by reference.
(d) No financial statement schedules required by this
paragraph are required to be filed as a part of
this form.
<PAGE>
SIGNATURES
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 duly authorized persons.
Registrant: Far West Electric Energy Fund, L.P.
By: Far West Capital, Inc.,
General Partner
DATE: March 16, 1995 By: /s/
Alan O. Melchior, President
Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed by the following persons on
behalf of the registrant and in the capacities and on the dates
indicated.
DATE: March 16, 1995 By: /s/
Alan O. Melchior, Director and
Principal Financial Officer and
Principal Executive Officer
DATE: March 16, 1995 By: /s/
Thomas A. Quinn, Director
DATE: March 16, 1995 By: /s/
Ronald E. Burch, Director
DATE: March 16, 1995 By: /s/
Jody Rolfson
Principal Accounting Officer
Exhibit ( 3 ) ( b )
AMENDMENT TO
CERTIFICATE AND AGREEMENT OF
LIMITED PARTNERSHIP OF
FAR WEST ELECTRIC ENERGY FUND, L.P.
The Certificate and Agreement of Limited Partnership of Far West
Electric Energy Fund, L.P. ("Certificate") is hereby amended
effective January 1, 1995 to reflect in the introductory paragraph
thereof, and in Article II. Definitions, and everywhere else in the
Certificate that the term "General Partner" is stated, that Alan O.
Melchior and Thomas A. Quinn have withdrawn and resigned as general
partners effective January 1, 1995, leaving Far West Capital, Inc.
as the sole General Partner of the Partnership.
GENERAL PARTNER
Far West Capital, Inc.
By:/S/ Alan O. Melchoir
Its: President
WITHDRAWING GENERAL PARTNERS
/s/ Alan O. Melchior
/s/ Thomas A. Quinn
Limited Partners:
All Limited Partners now and hereafter admitted as limited partners
of the Partnership, pursuant to Powers of Attorney now and
hereafter executed in favor of, and delivered to, the General
Partner.
By: Far West Capital, Inc.
By:/S/ Thomas S. Quinn
Authorized Officer
Exhibit ( 10 ) (aai )
PURCHASE AND SALE AGREEMENT
THIS AGREEMENT is made and entered into this 28th day of February,
1995, by and among CRYSTAL SPRINGS HYDROELECTRIC, L.P., a
Washington limited partnership ("Purchaser"), and CRYSTAL SPRINGS
HYDROELECTRIC COMPANY, an Idaho general partnership ("Seller").
Recitals
1. Seller believes that it is the owner of all of the assets
relating to the ownership and operation of a hydroelectric facility
located in Twin Falls County, Idaho, commonly known as the Crystal
Springs Hydroelectric Project (the "Facility"). Purchaser desires
to acquire and Seller desires to sell to Purchaser all of the
assets relating to the Facility on the terms and conditions set
forth below.
2. Seller has owned and operated, through various contract
operators, the Facility at different times from 1985 to the
present. During this same time period, at various times, Bonneville
Corporation developed, owned and operated the Facility. The parties
recognize that with respect to any representations made by Seller
in this Agreement, Seller is not chargeable with information about
the Facility known to Bonneville Pacific Corporation or contract
operators which was not communicated to Seller.
3. In connection with the transactions contemplated by this
Agreement, Seller has given Purchaser the opportunity to review the
Facility, interview the current contract operator and review
Seller's files with respect to the Facility. In addition, Seller
has furnished Purchaser any information concerning the Facility
requested by Purchaser and has not knowingly withheld any material
information concerning the Facility,v.
Agreements
NOW, THEREFORE, in consideration of the mutual agreements
herein contained and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, and in
reliance upon the representations and warranties of each party
herein set forth, the parties hereto, intending to be legally bound
hereby, AGREE:
<PAGE>
Section 1. DEFINITIONS.
The following terms shall have the indicated definitions in this
Agreement:
1.01 "Agreement." This Purchase and Sale Agreement, as such
may be amended, modified or supplemented from time to time.
1.02 "Facility." The hydroelectric facility located in Twin
Falls County, State of Idaho, commonly known as the Crystal
Springs Hydroelectric Project. I
1.03 "FERC." The Federal Energy Regulatory Commission, an
agency of the United States Government.
1.04 "Idaho Power Company." Idaho Power Company, a Maine
corporation.
Section 2. PURCHASE AND SALE OF ASSETS
2.01 Purchase and Sale of Assets. On the terms and subject to the
conditions of this Agreement, Seller agrees to and will sell,
transfer, assign and convey to Purchaser and Purchaser will
purchase from Seller all of Seller's right, title and interest in
and to the "Assets," as defined below, free and clear of all liens,
claims and encumbrances except as provided herein. The "Assets" are
all of the assets, equipment and properties of Seller relating to
its ownership, development and operation of the Facility, tangible
and intangible, real and personal, and include the following,
without limitation:
(a) The operating assets, inventory, equipment and receivables of
Seller relating to or used in connection with the Facility,
including:
All "Inventory" (as hereinafter defined), all "Receivables" (also
hereinafter defined) and all "Equipment" (also hereinafter defined)
of Seller relating to or used in connection with the Facility; all
of Seller's fixtures, goods, materials and other tangible personal
property relating to or used in connection with the Facility; all
of Seller's patents, trademarks, goodwill, know how, intellectual
property of all kinds, customer lists, choses in action, contracts
and contract rights, instruments and other intangible personal
property (including general intangibles), and all other items of
personal property of whatever description (including but not
limited to those specific items listed below in Section 2.01(d)),
whether now owned or hereafter acquired or arising; all proceeds of
any of the foregoing (including, specifically, proceeds of
insurance policies insuring any of the forgoing against loss by
theft, casualty or otherwise); all of Seller's rights to goods
represented by or securing Receivables, and all of Seller's rights
as an unpaid vendor, including the right to reclaim goods and to
replevy goods under the Uniform Commercial
Code and including all returned and repossessed goods, wherever
located; anysubstitutions for, accessions, modifications and
improvements to and other additions and replacements for any of the
foregoing and any other rights or interests arising out of or in
connection with any of the foregoing; all records, accounting or
otherwise, reports, papers and documents relating to any of the
foregoing, including all computer records, data programs, software,
disks, etc. relating to or arising out of or used in connection
with any of the foregoing, as may be requested by Purchaser.
As used above, the term "Equipment" shall have the meaning
provided therefor in the Uniform Commercial Code and shall also, for
purposes hereof, include any and all machinery, tools, equipment,
computers, furniture, furnishings, etc. used in or in connection with
the Facility, now owned or hereafter owned, acquired or arising or
created. As used above, the term "Inventory" or "Inventories" shall
have the meaning specified in the Uniform Commercial Code, including
all of the same now owned or hereafter acquired by Seller wherever
located, and also including all of Seller's right as the seller of
goods under the Uniform Commercial Code and all Inventory which may be
returned or repossessed, and also all proceeds of the same including also
insurance proceeds realized in connection with the Inventory, its
loss or damage, including without limitation, all raw materials,
stock in trade, finished goods and goods in progress.
As used above, the term "Receivables" shall mean any and all of
Seller's accounts (as defined in the Uniform Commercial Code) and any and
all rights of any kind of Seller to payment from a third party, including
all instruments, executory contract rights, contract rights, chattel paper
and any general intangibles, whether now held or existing, or hereafter
acquired or arising relating to the Facility. Receivables shall
also include all proceeds of the same and shall also mean all
ledger sheets, files, records and documents relating to the same,
including but not limited to, invoices, purchase orders, contracts,
etc. as may be requested by Purchaser.
(b) All of Seller's supplies used in connection with the operation
of the Facility including, without limitation, supplies of fuel,
lubricants, spare parts and other consumable supplies (the "Supplies");
(c) All of Seller's right to and interest in all permits, licenses,
governmental approvals, contracts and agreements necessary for or used in
connection with the ownership, development and operation of the
Facility and the transmission and sale of electric power to Idaho
Power Company, including, without limitation, those documents
identified on Exhibit 2.01(c) (the "Permits and Contracts");
(d) All of Seller's right to and interest in: (1) One diversion and
penstock inlet structure; (2) two automated fish and trash racks
with associated equipment, controls, meters and lights; (3) 7850 LF
of 60" OD penstock with associated air-vacuum valves, drain valves,
manways dresser couplings and thrust blocks; (4) 9400 LF of
graveled access road with associated drainage and improvements; (5)
Powerhouse, including but not limited to base gravel, concrete
footings, foundation walls, floor slab and building construction;
(6) Penstock manifold with four branches to each of the four
turbines with its associated flanges, bolts, drains, couplings and
thrust block; (7) four Allis Chalmers insolation valves with
operators and their associated motors and controls: A) two 24"
valves, and B)two 30" valves; (8) four IngersollRand Horizontal
Francis Turbines: A) Turbine #1: capacity 548 KW, model 16 x 23 ST;
B) Turbine #2: capacity 686 KW, model 16 x 23 ST; C) Turbine #3:
capacity 767 KW, model 16 x 23 S; and D) Turbine #4: capacity 911
KW, model 20 ALVT; (9) four Westinghouse Horizontal Induction
Generators: A) Generator #1 - capacity 617 KW; B) Generator #2
capacity 776 KW; C) Generator #3 - capacity 882 KW; D) Generator #4
- capacity 1048 KW; (10) one Power Factor Assemble; (11)
Westinghouse Generator Controller Equipment; (12) one Neutral
Grounding Resistor Assembly; (13) one 3500 KVA Transformer and
accessories; (14) one Indoor Station Auxiliary Transformer with a
service panelboard for powerhouse loads; (l5) one Programmable
controller package - built by J-U-B Engineers, Inc.; and (16) 7,313
lineal feet of 46 KV transmission line.
Seller believes but does not warrant (and has not attempted to
verify) that the equipment described in paragraph 2.01(d) above is
an accurate description of the equipment located at the Facility.
2.02 Excluded Assets. Anything to the contrary in Section 2.01
notwithstanding, the Assets shall not include any assets of Seller
which do not relate to Seller's ownership, development and
operation of the Facility.
2.03 Purchase Price and Payment.
(a) As consideration for the Assets, Purchaser agrees, subject to
the terms, conditions and limitations set forth in this Agreement,
to pay to Seller in cash at Closing the total sum of One Million
One Hundred Thousand Dollars ($1,100,000.00) (the "Purchase
Price").
(b) From funds received at Closing and as a part of Closing, Seller
agrees to irrevocably instruct the closing agent as follows:
(i) To disburse the cash sum of $69,000.00 to Purchaser, which sum
shall be utilized by Purchaser to pay "Additional Rentals" due to
Crystal Springs Ranch Limited Partnership, an Idaho limited
partnership, pursuant to the Amended Lease Agreement executed
February 28, 1995, between Crystal Springs Ranch Limited
Partnership, an Idaho limited partnership, and Crystal Springs
Hydroelectric, L.P., a Washington limited partnership;
(ii) To disburse the cash sum of $12,500.00 to Crystal Springs
Research & Development, an Idaho general partnership, and Crystal
Springs Trust, an Idaho trust, under Trust Agreement dated April 1, 1985.
(c) At Closing and as a part of Closing, Purchaser agrees to
arrange to disburse the cash sum of $12,500.00 to Crystal Springs
Research & Development, an Idaho general partnership, and Crystal
Springs Trust, an Idaho trust, under Trust Agreement dated April 1,
1985.
2.04 Excluded Liabilities. Anything to the contrary
notwithstanding, Purchaser is not assuming any of the following
liabilities, contracts, commitments and other obligations of
Seller:
(a) Any obligations or liabilities of Seller arising under this
Agreement;
(b) Any obligation of Seller for federal, state or local tax
liability (including interest and penalties) arising from the
operation of the Facility by Seller up to the time of Closing or
arising out of the sale by Seller of the Assets pursuant hereto;
(c) Any obligation of Seller for any transfer, sales or other
taxes, fees or levies arising out of the sale of the Assets
pursuant hereto;
(d) Any obligation of Seller for expenses incurred in connection
with the sale of the Assets pursuant hereto; or
(e) Any other liability or obligation of Seller.
Seller represents and warrants that: (a) the Facility has not been
operational at any time during 1995; (b) all expenses necessary to
preserve and protect the operational status of the Facility during
1995 (including without limitation permit fees, license fees,
insurance, utility expenses and the like) have been paid; and (c)
Seller, at Closing, will have no unpaid obligations or liabilities
with respect to the Facility except as disclosed on Exhibit 4.10.
In reliance upon this representation and warranty and
notwithstanding paragraph 2.04(b), and in exchange for Seller's
assignment of all right, title and interest to Seller's existing
insurance policies, Purchaser agrees to assume and pay any
obligation for federal, state or local tax liability which may
arise or be attributable to the ownership or operation of the
Facility during 1995.
Section 3. CLOSING.
3.01 Closing. The closing of the transactions contemplated by this
Agreement (the "Closing") shall take place at the offices of
Security Title (formerly Chicago Title Insurance Company of Idaho),
311 2nd Street North, Twin Falls, Idaho 83301, at 10:00 a.m., local
time, on March 2, 1995, or at such other date, time and place as
Purchaser and Seller shall mutually agree in writing (the "Closing
Date"), provided that all of the conditions precedent set forth in
this Agreement have been satisfied or waived as of said Closing
Date. Conveyance, transfer, assignment and delivery of the Assets
shall be by bills of sale, certificates of transfer, endorsements,
assignments and other instruments of transfer and conveyance in
such form as the parties shall mutually agree.
3.02 Deliveries by Seller. At Closing, Seller shall execute and
deliver the following and such execution and delivery shall be a
further condition to Closing:
(a) A bill of sale in the form attached hereto as Exhibit 3.02(a)
covering all of the Assets not covered by the other transfer
documents referred to herein;
(b) Such assignments of and consents to the transfer of each of the
Permits and
Contracts as Purchaser may request;
(c) Such other documents and instruments as counsel for Purchaser
may reasonably require to effectuate or evidence the transfer of
all of the Assets, including but not being limited to those
referenced on Exhibit 2.01(c) and:
(i) Assignment of Interest by Crystal Springs Research &
Development, an Idaho general partnership, and Crystal Springs
Trust, an Idaho trust, as Assignor, to Seller, as Assignee, in form
hereto attached as Exhibit 3.02(c)(i);
(ii) Affidavit of Lost Stock Certificate and Assignment Separate
From Certificate executed by M. Gary Atkinson, in form hereto
attached as Exhibit 3.02(c)(ii);
(iii) Certification by the Idaho Secretary of State's Office that
WaLker & Atkinson, Chartered, has been duly reinstated as a
corporation and is a corporation in good standing in the State of
Idaho;
(iv) Consent and Agreement to Amended Lease Agreement in form
hereto attached as Exhibit 3.02(c)(vi);
(v) Assignments, in form satisfactory to Purchaser, of all of
Seller's existing insurance policies and all rights thereunder to
Purchaser.
3.03 Deliveries by Purchaser. At Closing, Purchaser shall execute
and deliver a certified or cashier's check in the full amount of
the Purchase Price, and such execution and delivery shall be a
further condition to the Closing.
3.04 Possession. Purchaser shall take possession of the Assets as
of Closing.
3.05 Taxes and Fees.
(a) Any transfer, sales, use or other tax, including any real
estate excise tax or transfer, filing or recording fees, payable
upon or with respect to the sale of the Assets shall be paid when
due by Seller.
(b) All real or personal property taxes attributable to any of the
Assets shall be prorated as of January 1, 1995, subject to the
representations and warranties of Seller made pursuant to Section
2.04 above.
Section 4. REPRESENTATIONS And WARRANTIES OF SELLER
Seller reasonably believes but does not warrant that, as of the
Closing Date:
4.01 Organization. Good Standing and Power. Seller (a) is a general
partnership duly organized, validly existing and in good standing
under the laws of the State of Idaho; (b) is in good standing in-
the State of Idaho; and (c) has the requisite power and authority
to own and operate the Facility and to carry on its business as
presently conducted.
4.02 Authorizations and Enforceability. Seller has all requisite
power and authority to execute, deliver and perform this Agreement
and to consummate the transactions contemplated hereby. This
Agreement has been duly and validly authorized, executed and
delivered by Seller and constitutes the valid and binding
obligation of Seller, fully enforceable in accordance with its
terms.
4.03 Effect of Agreement. Etc. The execution, delivery and
performance of this Agreement by Seller and the consummation of the
transactions contemplated hereby will not, with or without the
giving of notice or the lapse of time, or both: (a) violate any
provision of law, statute, rule or regulation to which Seller is
subject; (b) violate any judgment, order writ or decree of any
court, arbitrator or governmental agency applicable to Seller; (c)
have any adverse effect on any of the Assets, including any of the
Permits and Contracts to be assigned to Purchaser pursuant to this
Agreement, or the ability of Purchaser to make use of such Permits
and Contracts; or (d) result in the breach of or conflict with any
term, covenant, condition or provision of, result in the
modification or termination of, constitute a default under, or
result in the creation or imposition of, any lien, security
interest, charge or encumbrance upon any of
the Assets pursuant to any charter, bylaw, commitment, contract or
other agreement or instrument to which Seller is a party or by
which any of the Assets is or may be bound or affected or from
which Seller derives benefit.
4.04 Title To and Sufficiency of Assets. At Closing, Seller will
have good and marketable title to the Facility and all of the
Assets, free and clear of all liens, security interests, pledges,
agreements, claims, charges or other encumbrances of any nature
whatsoever. The Assets constituting the Facility as of the Closing
Date are all of the assets (including land rights) which are
necessary to Purchaser's ownership and operation of the Facility,
and to the production and transmission of electrical energy from
the Facility to Idaho Power Company during the term of and
consistent with the Firm Energy Sales Agreement executed March 31,
1984, by and between Seller and Idaho Power Company (as identified
on Exhibit 2.01(c)). In addition, the Permits and Contracts
identified on Exhibit 2.01(c) are all of the material leases,
contracts, deeds, agreements, easements, licenses, governmental
approvals, authorizations, permits and rights-of-way owned or held
by Seller on the Closing Date which relate to the Facility and
which are necessary to Purchaser's ownership and operation of the
Facility and the production and transmission of electrical energy
to Idaho Power Company.
4.05 Transfer of Assets. The Assets which are being purchased by
Purchaser hereunder when sold and delivered in accordance with the
terms hereof for the consideration expressed herein, will be duly
and validly transferred to Purchaser and upon the delivery to
Purchaser of the Bill of Sale and other transfer and assignment
documents contemplated hereby, Purchaser will have good and
marketable title to the Facility, free and clear of all liens,
claims, encumbrances and other rights of third parties.
4.06 Environmental Matters. There are no pending or threatened
claims that are or could be asserted against Seller or its
predecessors, which relate to any toxic or hazardous substance
having been improperly generated, handled, released (or threatened
to be released), treated, stored or disposed of, or otherwise
deposited in, on, beneath or in close proximity to the real
property upon which the Facility is constructed (the "Facility
Site"), including, without limitation, the surface waters and
subsurface waters thereof, and there are no of no underground tanks
that are or have been located on, in or in close proximity to the
Facility Site. As of the date hereof, there are no pending or
threatened Environmental Claims (as hereinafter defined) that are
or could be asserted against Seller or its predecessors, which
relate to the Facility Site. There are no pending or threatened
claims that are or could be asserted under the
ComprehensiveEnvironmental Response, Compensation and Liability Act
of 1980 ("CERCLA"), as codified at 42 U.S.C. 9601 et. sea.; the
Resource Conservation and Recovery Act of 1976 as amended, as
codified at U.S.C. 6901 et. seq.; and the Superfund amendments and
Reauthorization Act of 1986, as codified at 42 U.S.C. 9671 et.
sea., or other federal, state or local environmental statute,
regulation, ordinance or regulatory requirement.
4.07 Utilities and Utility Agreements. All utilities necessary for
the use and operation of the Facility, including gas, electricity
and water, have been installed, are in good operating condition and
repair and satisfy the operating requirements of the Facility.
There are no commitments or agreements with any governmental agency
or public or private utility affecting the Facility which have not
been disclosed to Purchaser by Seller.
4.08 Litigation. There is no suit, action or proceeding pending or
threatened against Seller or the Facility or any of the Assets,
including the Permits and Contracts, and there is no judgment,
order, injunction, decree, regulation or ruling of any court
orgovernmental department, commission, agency, instrumentality or
arbitration outstanding against Seller or any of the Assets or the
Facility having or which, insofar as can be foreseen in the future,
may have any adverse effect on the operation and use of the
Facility and the Assets.
4.9 Governmental Authorizations and Regulations. There are no
existing conditions at the Facility that could cause the Facility
to become in violation of or in noncompliance with any governmental
rule or regulation.
4.10 Contracts. Except as otherwise disclosed in this Agreement,
Seller is not a party to any written or- oral contract or
commitment for the current or future performance of any obligation
relating to or in connection with the Facility, including but not
limited to:
(a) Agreement of guarantee or indemnification;
(b) Agreement, contract or commitment containing any covenant
limiting the freedom of Purchaser to own and operate the Facility;
or
(c) Mortgage, note, deed of trust or other payment obligation or
security agreement.
Seller is not a party to any contract, agreement or commitment
relating to or in connection with the Facility which is in default,
or which is subject to a condition which will give rise to a
default, except those identified on Exhibit 4.10, which defaults
shall be cured or otherwise waived at Closing. The contracts and
agreements, including the Permits and Contracts, specifically
identified in this Agreement have not been amended or revoked,
except as noted herein.
4.11 Taxes. All tax returns required to be filed by Seller in any
jurisdiction have been filed; and at or prior to Closing, all taxes
imposed by any taxing authority which are due and payable by Seller
prior to December 31, 1994, with respect to or in connection with
the Facility shall have been paid in full, and all deposits
required by law to be made with respect to any tax will have been
made.
4.12 Employee Matters. Seller has never had any employees.
4.13 Permits and Contracts. Seller has complied in all material
respects with all of the applicable rules, regulations and
requirements of all governmental licenses, permits and
authorizations held by Seller in connection with the ownership,
development and operation of the Facility. All information and
disclosures made on any applications for licenses, permits or
authorizations were true when made. Seller has no knowledge of any
claim violations from any governmental agency or any other person
with respect to the licenses, permits and authorizations held by
Seller in connection with the operation of the Facility, including
the Permits and Contracts, and Seller has no knowledge that any
condition exists which may give rise to a claim of violation in the
future.
4.14 Status of Permits and Contracts. All of the Permits and
Contracts are in good standing and in full force and effect, and
there has been no material adverse change in the status of the
Permits and Contracts which threatens, restricts or prohibits the
operation of the Facility. For purposes of the foregoing, it shall
be considered a material adverse change if any of the Permits and
Contracts are withdrawn, revoked or denied or if any Permit or
Contract is determined by a court of competent jurisdiction to be
invalid or to have been improperly issued. There have been no
amendments to the Permits and Contracts which have not been
disclosed to Purchaser.
4.15 Changes in Facility Operations. Except as disclosed in Exhibit
4.10, for a period of six months preceding the Closing Date, no
material obligations (including any indebtedness) have been
incurred and no material transactions have been entered into with
respect to or in connection with the Facility. except for this
Agreement and the transactions contemplated hereby, and Seller has
not suffered any theft, damage, destruction, casualty loss or other
material change, materially and adversely affecting the Assets or
the business, operations, liabilities, earnings or condition of the
Facility.
4.16 Accuracy of Representations. No representation, covenant or
warranty by Seller contained in this Agreement contains or will
contain on the Closing Date any untrue statement of a material fact
or will omit to state a material fact necessary in order to make
the statements contained therein not misleading.
Section 5. REPRESENTATIONS AND WARRANTS OF PURCHASER.
Purchaser hereby represents and warrants to Seller that, as of the
Closing Date:
5.01 Organization. Good Standing. Power. Etc. Purchaser is a
limited partnership duly organized, validly existing and in good
standing under the laws of the State of Washington and is
authorized or licensed to do business in all other jurisdictions in
which the failure to so qualify would have a material and adverse impact
on its business or properties. Purchaser has the power and authority to
carry on its business as now conducted and as proposed to be conducted.
5.02 Authorization. All necessary actions on the part of Purchaser
necessary for the authorization, execution, delivery and performance of this
Agreement and the consummation of the transactions contemplated
herein has been taken or will be taken prior to Closing. This
Agreement, when executed and delivered, shall constitute the legal,
valid and binding obligations of Purchaser, enforceable against
Purchaser in accordance with its terms.
5.03 Accuracy of Representations. No representation, covenant or
warranty by Purchaser contained in this Agreement contains or will contain
on the Closing Date any untrue statement of a material fact or will
omit to state a material fact necessary in order to make the
statements contained therein not misleading.
Section 6. ADDITIONAL AGREEMENTS OF SELLER And PURCHASER.
6.01 Liability for Expenses. Seller will pay all expenses incurred
by Seller and Purchaser will pay all expenses incurred by Purchaser in
connection with the negotiation, execution and performance of this Agreement,
whether or not-the transactions contemplated hereby are
consummated, including the fees and expenses of agents,
representatives, accountants and counsel for each party.
6.02 Execution of Further Documents. From and after the Closing
Date, upon the reasonable request of Purchaser, Seller shall execute,
acknowledge and deliver all such further documents as may be required to
convey and transfer to and vest in Purchaser and protect its right, title
and interest in all of the Assets purchased pursuant to this
Agreement, and as may 8 be appropriate otherwise to carry out the
transactions contemplated by this Agreement.
Section 7. CONDITIONS TO OBLIGATIONS OF PURCHASER.
All obligations of Purchaser under this Agreement are subject to
the fulfillment, at or prior to the Closing Date, of each of the following
conditions precedent:
7.01 Closing Certificate. Each of the representations and
warranties of Seller as contained in this Agreement shall be true on and
as of the Closing Date with the same force and effect as though made on
and as of the Closing Date, except as affected by the transactions
contemplated hereby. Seller shall have performed and complied with all
covenants, obligations and agreements to be performed or complied
with by it on or before the Closing Date pursuant to this
Agreement. Seller shall have delivered to Purchaser a certificate
in the form attached hereto as Exhibit 7.01, dated as of the
Closing Date, certifying that such representations and warranties
are true and correct and that all such obligations have been
performed and complied with.
7.02 Consents. Purchaser shall have obtained all consents and
approvals of all persons and entities necessary for the performance
of the transactions contemplated by this Agreement and the
ownership and operation of the Facility by Purchaser, including,
without limitation, the following consents relating to the permits
and Contracts (as identified on Exhibit 2.01(c)):
(a) The consent of FERC to the transfer to Purchaser of the FERC
license(s);
(b) The consent of the State of Idaho to the transfer to Purchaser
of the transfer of all water rights necessary for operating the
Facility;
(c) The consent of Patricia Wilson Sibley, Samuel H. Sibley, Asher
B. Wilson, Jr., Asher B. Wilson m, Clark S. Wilson, James Edward
Wilson, Mark L. Wilson, David R. Millard, Barbara L. Millard,
Robert A. Kantor, Sandra Kantor, Derek C. Cantrell, Georgia Lee
Cantrell, Charles Cantrell, Vivian Cantrell and Crystal Springs
Ranch Limited Partnership, an Idaho Limited Partnership, to the
transfer to Purchaser of the Road Permit and Special Use Permit;
(d) The consent of the State of Idaho to the transfer to Purchaser
of the Water Permits;
(e) The consent of Idaho Power Company to the transfer to Purchaser
of the Firm Energy Sales Agreement;
(f) The consent of all partners of Seller to the transfer to
Purchaser of the Assets and the Facility; and
(g) All assignments, consents or other requirements pursuant to
this Agreement.
7 03 Letters of Good Standing. Purchaser shall have obtained
letters from applicable governmental authorities to the effect that the
FERC License and the Water Permit are in good standing and in full force
and effect, and from Idaho Power Company to the effect that the Firm Energy
Sales Agreement is in good standing and in full force and effect.
7.04 Litigation. Etc.
(a) There shall not be pending or threatened any action or
proceeding by or before any court or other governmental body which
shall seek to restrain, prohibit or invalidate
the sale of the Assets and the Facility to Purchaser or any other
transaction contemplated hereby, or which might have a material
adverse affect on the Assets and the Facility or which might affect
the right and ability of Purchaser to own, operate in its entirety
or control the Facility, and which, in the judgment of Purchaser,
makes it inadvisable to proceed with the transactions contemplated
hereby.
(b) No violation of Seller shall exist or be alleged by any
governmental authority to exist, of any law, statute, ordinance or
regulation, the enforcement of which would materially adversely
affect the financial condition, results of operations or the Assets
after Closing.
(c) No law, regulation or decree shall have been proposed, adopted
or promulgated, or have become effective, the enforcement of which
would materially adversely affect the ability of Seller to
consummate the transactions contemplated hereby or would materially
adversely affect the ability of Purchaser to own and operate the
Facility.
7.05 Lien Search. Purchaser shall have received the report or
reports of the appropriate public officials and a reputable title
company or companies indicating that they have reviewed the
approprIate recording files for mortgages, financing statements,
conditional sales contracts, chattel mortgages, lease agreements,
notices of assignment of accounts receivable, factors' liens, trust
receipts and tax liens, and that there are no mortgages, claims
liens, charges, encumbrances, security interests, restrictions on
use of transfer or other defects of record with respect to the
Facility and the Assets.
7.06 Losses. Seller shall not have sustained any loss or damage to
the Facility or the Assets which in the opinion of Purchaser
materially affects the value of the Facility and Assets or the
ability of Purchaser to own and operate the Facility.
7.07 Completion of Review by Purchaser. Purchaser shall have
completed its business, accounting, environmental and legal review
of the Facility and the Assets, and Purchaser shall, in its sole
discretion, be satisfied with the results of such investigation or
otherwise waive this condition in writing prior to Closing.
Section 8. CONDITIONS TO OBLIGATIONS OF SELLER.
All obligations of Seller under this Agreement are subject to the
fulfillment, at or prior to the Closing Date, of each of the
following conditions:
8.01 Closing Certificate. Each of the representations and
warranties of Purchaser contained in this Agreement shall be true
on and as of the Closing Date with the same force and effect as
though made on and as of the Closing Date, except as affected by
the transactions contemplated hereby. Purchaser shall have
delivered to Seller a certificate in the form hereto attached as
Exhibit 8.01, dated as of the Closing Date, certifying that such
representations and warranties are true and correct.
8.02 Litigation. Etc. No claim, action, suit, proceeding,
arbitration, investigation or hearing or notice of hearing shall be
pending or threatened against or affecting Purchaser which might
result, or has resulted, either in an action to enjoin or prevent
or delay the consummation of the transactions contemplated by this
Agreement or in such an injunction.
Section 9. MISCELLANEOUS.
9.01 Survival of Representations and Warranties. All of the
respective representations and warranties of the parties to this
Agreement shall survive the consummation of the transactions
contemplated hereby.
9.02 Brokers' Commissions. Each party hereto will indemnify and
hold harmless each other party from any commission, fee or claim of
any person, firm or corporation employed or retained by, or
claiming to be employed or retained by, the indemnifying party to
bring about, or to represent it in, the transactions contemplated
hereby.
9.03 Amendment and Modification. This Agreement shall not be
amended or modified except in a writing signed by the parties
hereto.
9.04 Successors. This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective successors,
heirs, administrators and assigns.
9.05 Notices. All notices or other communications hereunder shall
be deemed to have been given when personally delivered or when
deposited in the U.S. mail, registered or certified, postage
prepaid and addressed as follows:
To Seller:
Crystal Springs Hydroelectric Company c/o Far West Capital, Inc.
921 Executive Park Drive, Suite B Salt Lake City, Utah 84117
Attn: Thomas A. Quinn
To Purchaser:
Crystal Springs Hydroelectric, L.P. c/o Weatherly 11225 S.E. 6th,
Suite 100 Bellevue, WA 98004
Attn: Mr. Dell Keehn
with a copy to:
M. Kathrine Julin
Julin, Fosso, Sage, McBride & Mason
1001 4th Avenue, Suite 3900
Seattle, Washington 98154-1084
9.06 Severability. If any provision of this Agreement is determined
to be illegal or unenforceable, such provision will be deemed
amended to the extent necessary to conform to applicable law or, if
it cannot be so amended without materially altering the intention
of the parties, it will be deemed stricken and the remainder of the
Agreement will remain in full force and effect.
9.07 Waivers. No action taken pursuant to this Agreement, including
any investigation by or on behalf of any party, shall be deemed to
constitute a waiver by the party taking such action of compliance
with any representation, warranty, covenant or agreement contained
herein. The waiver by any party hereto of a breach of any provision
of this Agreement shall not operate or be construed as a waiver of
any subsequent breach.
9.8 Execution in Counterparts. This Agreement may be executed in
any number of counterparts, each of which, when executed, shall be
deemed to be an original, and all of which together shall be deemed
to be one and the same instrument.
9.9 Attorneys' Fees. In the event legal action is taken by either
party to enforce this Agreement, or any action arising out of the
representations, warranties and covenants contained herein, all
costs and expenses, including reasonable attorneys' fees, incurred
by the prevailing party shall be paid by the nonprevailing party.
9.10 Jurisdiction. Venue and Governing Law. In the event of any
action or proceeding arising out of this Agreement or the
transactions contemplated hereby, the parties agree that the
exclusive jurisdiction and venue shall lie in the Salt Lake County
District Court in Salt Lake City, Utah. This Agreement shall be
construed as to both validity and performance and enforced in
accordance with and governed by the internal laws of the State of
Utah.
9.11 Time of Essence. Time is of the essence of this Agreement and
each and every covenant, condition and provision hereof.
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date first above written.
SELLER:CRYSTAL SPRINGS HYDROELECTRIC COMPANY
By: Far West Electric Energy Fund, L.P., a Delaware limited
partnership, as General Partner
By: Far West Capital, Inc., General Partner
By /s/ Thomas O. Quinn, Vice President
PURCHASER:CRYSTAL SPRINGS HYDROELECTRIC, L.P.
By: Gateway Energy, Inc., its General Partner
By: /s/ Dell E. Keehn, President
<PAGE>
LIST OF EXHIBITS
Exhibit 2.01(c) Permits and
Contracts
Exhibit 3.02(a) Form of Bill of
Sale
Exhibit 3.02(c)(i) Assignment of
Interest
Exhibit 3.02(c)(ii) Affidavit of Lost
Certificate
Exhibit 3.02(c)(vi) Consent and
Agreement to
Amended Lease Agreement
Exhibit 4.10 Defaults of Seller
Exhibit 7.01 Closing Certificate of
Seller
Exhibit 8.01 Closing Certificate of
Purchaser
<PAGE>
Exhibit 2.01(c)
PERMITS AND CONTRACTS
A. Permits
1. All FERC Licenses relating to the Facility pursuant to the
Order Issuing Major License issued May 24, 1985, Project No.
8278-000, by the Office of Electric Power Regulation, Federal
Energy Regulatory Commission, as may have been amended.
2. All Water Permits issued by the State of Idaho relating to
water for the Facility, including but not limited to the Idaho
Department of Water Resources Water Permit Nos. 4707768, 47-07991,
47-08005 and 47-8009.
B. Contracts.
1. The Firm Energy Sales Agreement between Seller and Idaho
Power Company dated March 31, 1984.
2. Intertie Agreement dated October 3, 1985, between Seller
and Mistletoe Financial Company, a Utah general partnership.
3. Lease Agreement dated as of May 1, 1985, between Derek C.
Cantrell, Georgia Lee Cantrell, Charles Cantrell and Vivian
Cantrell, as Lessor, and Seller, as Lessee.
4. Lease Agreement dated as of May 1, 1985, between Patricia
Wilson Sibley, Samuel H. Sibley, Asher B. Wilson, Jr., Asher B.
Wilson III, Clark S. Wilson, James Edward Wilson, Mark L. Wilson,
and David R. Millard and Barbara L. Millard, as Lessor, and Seller,
as Lessee.
5. Right of Way Grant dated June 19, 1983, executed by Twin
Falls Bank and Trust, David R. Millard, Barbara L. Millard, and
Pisces Investments, as grantors, to Seller, as grantee.
6. Perpetual Easement Agreement dated June 19, 1985, between
Twin Falls Bank & Trust Company, Crystal Springs Ranch, Ltd., and
Pisces Investments, as grantors, and Seller, as grantee.
7. Agreement dated March 8, 1993, between Twin Falls Canal
Company, an Idaho corporation, and Seller, concerning added flows.
8. Any and all insurance policies presently in force
concerning or relating to the Facility or its operation.
<PAGE>
Exhibit 3.02(a)
BILL OF SALE
CRYSTAL SPRINGS HYDROELECTRIC, COMPANY, an Idaho general
partnership ("Seller"), for $10.00 and other good and valuable
consideration, receipt of which is hereby acknowledged, does hereby
sell, convey, transfer, assign and deliver to CRYSTAL SPRINGS
HYDROELECTRIC, L.P., a Washington limited partnership
("Purchaser"), all of its right, title and interest in the
following described personal property (the "Assets"):
(a) The operating assets, inventory,
equipment, receivables and supplies owned or
leased by Seller in connection with
the
operation of the Facility, as described in
Section 2.01(a), (b) and (d) of that
certain Purchase and Sale Agreement dated
February 28, 1995, by and among
Seller and
Purchaser (the "Agreement");
(b) All of Seller's permits, licenses,
governmental approvals, authorizations, contracts
and other agreements as identified on
Exhibit 2.01(c) to the Agreement;
Seller represents to Purchaser that Seller believes it has
legal title to the Assets, that Seller has complete and
unrestricted power to sell, convey, transfer, assign and deliver
said legal title to such Assets to Purchaser and that this Bill of
Sale is valid in accordance with its terms and effective for its
purpose.
DATED: , 19
CRYSTAL SPRINGS HYDROELECTRIC COMPANY
By: Far West Electric Fund, L.P., a Delaware limited partnership,
as General Partner
By: Far West Capital, Inc., General Partner
By:
Thomas A. Quinn, Vice President
<PAGE>
Exhibit 3.02(c)(i)
ASSIGNMENI OF INTEREST
See attached.
<PAGE>
ASSIGNMENT OF INTEREST
For the sum of Twenty-Five Thousand Dollars ($25,000) and other
good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged,
CRYSTAL SPRINGS RESEARCH & DEVELOPMENT, an Idaho general
partnership, and CRYSTAL SPRINGS TRUST, an Idaho Trust, under Trust
Agreement dated
effective April 1, 1985, Walker and Atkinson Chartered, Trustee, as
assignors
("Assignors") hereby assign, transfer, grant, convey and quit claim
to Far West Electric
Energy Fund, L.P., a Delaware limited partnership as assignee
("Assignee") all of
Assignors' right title and interest in and to the Crystal Springs
Hydroelectric Project, also known as the Cedar Draw Hydroelectric
Project, or Cedar Draw Creek Project which is
located on Cedar Draw Creek in Twin Falls County, Idaho
("Project").
This Assignment, transfer and conveyance includes, but is not
limited to, all of Assignors' rights, title and interest under that
certain Purchase Agreement entered into effective as of the 15th
day af May, 1985 by and among Assignors, Bonneville Pacific
Corporation and Far West Capital, Inc., speciffically including,
but not limited to, rights to receive royalties from the Project or
to repurchase the Project and Assiginors hereby waive and quit
claim any and all other right, title or interest whatsoever in the
Project, including Crystal Springs Hydroelectric Company
Parterniship Units, equipment, business interests, good will,
assets, titles, permits, applications, licenses, leases,
agreements, power contracts, water permits, rents, royalties,
distributions, revenues, options of any kind, and any other
interest, whether the same be present, past, future; known or
unknown.
The person signing for Assignors have the right and authority
to execute and make this Assignment of Interest with the consent
and approval of the beneficiaries and partners thereof and agrees
to indemnify and hold Assignee harmless from any claim, loss or
expense inclouding attorney's fees resulting from any breach
hereof.
Assignee hereby accepts and receives the foregoing
assignment,
transfer and conveyance.
This Assignment of Interest contains tbe entire agreement of
the parties and shall bind and inure to the benefit of all heirs,
successors and assigns of the parties hereto.
IN WITNESS WHEREOF, Assignors and Assignee have executed this
Assignment of Interest the _ day of 199_ by and through their
authorized representatives.
ASSIGNORS:
CRYSTAL SPRINGS TRUST
By: WALTER & Atkinson CHARTERED,
Trustee
By: /s/ Thomas G. Walker
Its: President
CRYSTAL SPRINGS RESEARCH &
DEVELOPMENT
By:/s/ Thomas G. Walker
Its: General Partner
ASSIGNEE:
FAR WEST ELECTRIC ENERGY FUND, LP.
By: FAR WEST CAPITAL INC.
Its: General Partner
By
Its:
<PAGE>
Exhibit 3.02(c)(ii)
AFFIDAVIT OF LOST CERTIFICATE
See attached.
<PAGE>
AFFIDAVIT OF LOST STOCK CERTIFICATE
AND
ASSIGNMENT OF SEPARATE FROM CERTIFICATE
STATE OF IDAHO
ss
County of Twin Falls
I, M Gary Atkinson of Twin Falls, Idaho being sworn, here state:
1. I am the sole shareholder of Walker, & Atkinson Chartered, an
Idaho professional corporation ("the Corporation").
2. The Corporation forfeited its charter on December 1, 1994, for
failure to file the required Annual Report Form.
3. To the best of my knowledge and belief, the Corporation's
charter can be reinstated by (a) filing the Annual Report Form with
the Secretary of State, Room 203, Statehouse, Boise, Idaho 83720,
and (b) paying a $20.00 fee.
4. As of the date of this Affidavit, I am the sole owner, subject
to my wife's community property interest, of all of the issue and
outstanding stock of the Corporation.
5. To the best of my recollection, the Corporation issued Stock
Certificate No. 1 to me at or about the time of its organization.
I do not recall how many shares were represented by Certificate No.
1. No other Stock Certificates were, or have been, issued by the
Corporation.
6. I intend, by the Assignment below, to grant, sell, assign and
transfer all of my right, title and interest in and to the
Corporation's issued and outstanding stock to Thomas G. Walker,
whose mailing address is P.O. Box 7707, Boise, Idaho 83707-1707
("Walker").
7. Because Stock Certificate No. 1 is lost, I am unable to deliver
said certificate to Walker.
8. I covenant and warrant that I have not disposed of Stock
Certificate No. 1, or any other certificate representing stock
Issued by the Corporation, or given any person a power of attorney
or any other authority to grant, assign or transfer stock issued by
the Corporation.
9. I make this Affidavit of Lost Stock Certificate in order to
induce Walker to accept the Assignment set forth below.
10. To the best of my knowledge and belief, the Corporation is the
trustee of Crystal Springs Trust under and by virtue of a Trust
Agreement dated May 1, 1985. I have been told by Walker that, upon
assignment of all of the issued and outstanding stock to him, he
intends to reinstate the Corporation's charter and thereafter: (a)
to elect himself as the sole director, (b) to elect himself as
president and to elect Curi M. Walker as secretary, and (c) to
execute and deliver certain documents on behalf of Crystal Springs
Trust.
11. If any original stock certificates issued by the Corporation is
found by me, I covenant and warrant to immediately deliver any such
certificates to Walker.
NOW THEREFORE, for value received, the adequacy and sufficiency of
which is acknowledged by me, I hereby sell, grant, assign and
transfer unto Thomas G. Walker, whose address is P.O. Box 7707,
Boise, Idaho 83707-1707, all of my right, title and interest in and
to any and all issued and outstanding stock of the Corporation.
Further, I hereby constitute and appoint the secretary of the
Corporation, and any and all successors in office, as my true and
lawful attorney in fact to transfer said shares on the books of the
Corporation with full power of substitution.
DATED: January __, 1995.
/s/ M. Gary Atkinson<PAGE>
Exhibit 3.02(c)(vi)
CONSENT AND AGREEMENT TO AMENDED LEASE AGREEMENT
See attached.
<PAGE>
CONSENT AND AGREEMENT
The CRYSTAL SPRINGS HYDROELECTRIC COMPANY, an Idaho general
partnership (the "Partnership"), as the lessee under the Lease
Agreement recorded June 24, 1985, as Instrument No. 883276, records
of Twin Falls County, Idaho (the "Original Lease"), does hereby
consent and agree to all of the modifications to the Original Lease
contained in the above Amended Lease Agreement and to the
substitution of CRYSTAL SPRINGS HYDROELECTRIC, L.P., a Washington
limited partnership, for the Partnership, as lessee thereunder.
The undersigned further warrant and represent to the
above-named Lessor and Lessee that Far West Capital, Inc., a Utah
corporation, Far West Energy Electric Fund, L.P., a Delaware
limited partnership, Alan O. Melchior, individually, and Thomas A.
Quinn, individually, are all of the general partners of the
Partnership with full power and authority to execute this Agreement
and bind the Partnership in all respects.
DATED this day of , 1995.
Crystal Springs Hydroelectric Company, an Idaho General
Partnership, by its under.signed General Partners:
Far West Capital, Inc., a Utah Corporation, Individually and as
General Partner
By Name: Title:
Far West Energy Electric Fund, L.P., a Delaware Limited
Partnership, Individually and as General Partner
By Name: Title:
/s/
Alan O. Melchior, Individually and as
General Partner
/s/
Thomas A. Quinn, Individually and as
General Partner
STATE OF )
: ss.
COUNTY OF )
On the day of , 1995, before me the undersigned, a
Notary Public in and for the State, personally appeared, known or
identified to me to be the of Far West Capital, Inc., a
General Partner of Crystal Springs Hydroelectric Company, a general
partnership, the partnership that
executed the foregoing instrument or the person who executed the
foregoing instrument on behalf
of said partnership, and acknowledge to me that such partnership
executed the same.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed
my
official seal the day and year first above written.
Notary Public Residing at My commission expires:
STATE OF )
: ss.
COUNTY OF )
On the day of
, 1995,
before me the undersigned, a Notary
Public in and for the State, personally appeared
, known or identified to me to be
the of Far West Energy Electric Fund, L.P., a General Partner of
Crystal Springs Hydroelectric Company, a general partnership, the
partnership that executed the foregoing instrument or the person
who executed the foregoing instrument on behalf of said
partnership, and acknowledge to me that such partnership executed
the same.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year first above written.
Notary Public Residing at My commission expires:
STATE OF
: ss.
COUNTY OF )
On the day of
, 1995,
before me the undersigned, a Notary Public in and for the State,
personally appeared Alan O. Melchior, a General Partner of Crystal
Springs Hydroelectric Company, a general partnership, the
partnership that executed the foregoing instrument or the person
who executed the foregoing instrument on behalf of said
partnership, and acknowledge to me that such partnership executed
the same.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year first above written.
Notary
Public
Residing at
My
commission
expires:
STATE OF )
: ss.
COUNTY OF )
On the day of , 1995, before me the
undersigned, a Notary Public in and for the State, personally appeared
Thomas A. Ouinn, a General Partner of Crystal
Springs Hydroelectric Company, a general partnership, the
partnership that executed the
foregoing instrument or the person who executed the foregoing
instrument on behalf of said
partnership, and acknowledge to me that such partnership executed
the same.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year first above written.
Notary Public Residing at My commission expires:
<PAGE>
Exhibit 4.10
DEFAULTS OF SELLER
1. Any and all agreements and/or obligations of Seller with
First
Security Bank of Utah, N.A.
2. The Lease Agreement dated May 1, 1985, by and between
Patricia
Wilson Sibley, Samuel H. Sibley, Asher B. Wilson, Jr., Asher B.
Wilson III, Clark S. Wilson, James
Edward Wilson, Mark L. Wilson, David R. Millard and Barbara L.
Millard and Seller.
3. The Purchase Agreement dated May 15, 1985, by and among
Crystal Springs Research & Development, an Idaho general
partnership, Crystal Springs Trust, an Idaho trust, Bonneville
Pacific Corporation, a Utah corporation, and Far West Capital,
Inc., a Utah corporation.
4. The lease Agreement dated May 1, 1985, by and between Derek
C.
Cantrell, Georgia Lee Cantrell, Charles Cantrell and Vivian
Cantrell and Seller.
5. The Intertie Agreement dated October 3, 1985, between Seller
and Mistletoe Financial Company, a Utah general partnership.
6. The Agreement dated March 8, 1993, between Twin Falls Canal
Company, an Idaho corporation, and Seller, concerning added flows.
7. The Firm Energy Sales Agreement between Seller and Idaho
Power
Company dated March 31, 1984.
8. Operating Agreement with Tom McCauley.
9. Extension and Modification Agreement between Seller and First
Security Bank of Utah, N.A.
24
<PAGE>
Exhibit 7.01
Certificate AS TO FULFILLMENT OF
CRYSTAL SPRINGS HYDROELECTRIC COMPANY ("Seller")
AND OBLIGATIONS
This certificate is made in response to Section 8.01 of the
Purchase and Sale Agreement (the "Agreement") by and among Crystal
Springs Hydroelectric, L.P. ("Purchaser") and the undersigned.
It is hereby certified by the undersigned that:
(a) All representations and warranties of the undersigned
contained in the Agreement or the Exhibits or the documents
described therein or otherwise made in writing pursuant to the
Agreement are true and correct at and as of the Closing Date (as
defined in the Agreement); and
(b) The undersigned has performed and complied with all the
covenants, agreements, obligations and conditions required by the
Agreement to be performed or complied with by the undersigned at or
prior to the Closing Date.
Dated: , 19
CRYSTAL SPRINGS HYDROELECTRIC COMPANY
By: Far West Electric Fund, L.P., a Delaware limited partnership,
as General Partner
By: Far West Capital, Inc., General Partner
By:
Thomas A. Quinn, Vice President
25
<PAGE>
Exhibit 8.01
CERTIFICATE AS TO FULFILLMENT
OF CRYSTAL SPRINGS HYDROELECTRIC, L.P.
("Purchaser") CONDITIONS
This certificate is made in response to Section 9.01 of the
Purchase and Sale Agreement (the "Agreement") by and among Crystal
Springs Hydroelectric Company ("Seller") and the undersigned.
It is hereby certified by the undersigned that:
(a) All representations and warranties of the undersigned
contained in the Agreement or otherwise made in writing pursuant to
the Agreement are true and correct at and as of the Closing Date
(as defined in the Agreement), except for changes contemplated or
permitted by the Agreement; and
(b) The undersigned has performed and complied with all of the
obligations and conditions required by the Agreement to be
performed or complied with by the undersigned at or prior to the
Closing Date.
Date: , 19
CRYSTAL SPRINGS HYDROELECTRIC, L.P.
("Purchaser")
By: Gateway Energy, Inc., its general partner
Dell E. Keehn, President
26
<PAGE>
Exhibit ( 10 ) ( aaj )
BILL OF SALE
CRYSTAL SPRINGS HYDROELECTRIC, COMPANY, an Idaho general
partnership ("Seller"), for $10.00 and other good and valuable
consideration, receipt of which is hereby acknowledged, does hereby
sell, convey, transfer, assign and deliver to CRYSTAL SPRINGS
HYDROELECTRIC, L.P., a Washington limited partnership
("Purchaser"), all of its right, title and interest in the
following described personal property (the "Assets"):
(a) The operating assets, inventory, equipment, receivables
and supplies owned or
leased by Seller in connection with the operation of the Facility,
as described in
Section 2.01(a), (b) and (d) of that certain Purchase and Sale
Agreement dated
February 28, 1995, by and among Seller and Purchaser (the
"Agreement"), and
as more particularly described on Exhibit A to this Bill of Sale;
(b) All of Seller's permits, licenses, governmental approvals,
authorizations, contracts and other agreements as identified on
Exhibit 2.01(c) to the Agreement, and as more particularly
described on Exhibit B to this Bill of Sale;
Seller represents to Purchaser that Seller believes it has
legal title to the Assets, that Seller has complete and
unrestricted power to sell, convey, transfer, assign and deliver
said legal title to such Assets to Purchaser and that this Bill of
Sale is valid in accordance with its terms and effective for its
purpose.
DATED: March 15, 1995.
CRYSTAL SPRINGS HYDROELECTRIC COMPANY
By: Far West Electric Energy Fund, L.P., a Delaware limited
partnership, as General Partner
By: Far West Capital, Inc.
/s/Thomas A. Quinn, Vice President
<PAGE>
The "Assets" are all of the assets, equipment and properties of
Seller relating to its ownership, development and operation of the
Facility, tangible and intangible, real and personal, and include
the following, without limitation:
(a) The operating assets, inventory, equipment and
receivables
of Seller relating to or used in connection with the Facility,
including:
All "Inventory" (as hereinafter defined), all "Receivables"
(also hereinafter defined) and all "Equipment" (also hereinafter
defined) of Seller relating to or used in connection with the
Facility; all of Seller's fixtures, goods, materials and other
tangible personal property relating to or used in connection with
the Facility; all of Seller's patents, trademarks, goodwill, know
how, intellectual property of all kinds, customer lists, choses in
action, contracts and contract rights, instruments and other
intangible personal property (including general intangibles), and
all other items of personal property of whatever description
(including but not limited to those specific items listed below in
paragraph (c)), whether now owned or hereafter acquired or arising;
all proceeds of any of the foregoing (including, specifically,
proceeds of insurance policies insuring any o the forgoing against
loss by theft, casualty or otherwise); all of Seller's rights to
goods represented by or securing Receivables, and all of Seller's
rights as an unpaid vendor, including the right to reclaim goods
and to replevy goods under the Uniform Commercial Code and
including all returned and repossessed goods, wherever located; any
substitutions for, accessions, modifications and improvements to
and other additions and replacements for any of the foregoing and
any other rights or interests arising out of or in connection with
any of the foregoing; all records, accounting or otherwise,
reports, papers and documents relating to any of the foregoing,
including all computer records, data programs, software, disks,
etc. relating to or arising out of or used in connection with any
of the foregoing, as may be requested by Purchaser.
As used above, the term "Equipment" shall have the meaning
provided therefor in the Uniform Commercial Code and shall also,
for purposes hereof, include any and all machinery, tools,
equipment, computers, furniture, furnishings, etc. used in or in
connection with the Facility, now owned or hereafter owned,
acquired or arising or created.
As used above, the term "Inventory" or "Inventories" shall
have the meaning specified in the Uniform Commercial Code,
including all of the same now owned or hereafter acquired by Seller
wherever located, and also including all of Seller's right as the
seller of goods under the Uniform Commercial Code and all Inventory
which may be returned or repossessed, and also all proceeds of the
same including also insurance proceeds realized in connection with
the Inventory, its loss or damage, including without limitation,
all raw materials, stock in trade, finished goods and goods in
progress.
EXHIBIT A - PAGE 1
As used above, the term "Receivables" shall mean any and all
of Seller's accounts (as defined in the Uniform Commercial Code)
and any and all rights of any kind of Seller to payment from a
third party, including all instruments, executory contract rights,
contract rights, chattel paper and any general intangibles, whether
now held or existing or hereafter acquired or arising relating to
the Facility. Receivables shall also include all proceeds of the
same and shall also mean all ledger sheets, files, records and
documents relating to the same, including but not limited to,
invoices, purchase orders, contracts, etc. as may be requested by
Purchaser.
(b) All of Seller's supplies used in connection with the
operation of the Facility including, without limitation, supplies
of fuel, lubricants, spare parts and other consumable supplies (the
"Supplies");
(c) All of Seller's right to and interest in: (1) One
diversion and penstock inlet structure; (2) two automated fish and
trash racks with associated equipment, controls, meters and lights;
(3) 7850 LF of 60" OD penstock with associated air-vacuum valves,
drain valves, manways dresser couplings and thrust blocks; (4) 9400
LF of graveled access road with associated drainage and
improvements; (5) Powerhouse, including but not limited to base
gravel, concrete footings, foundation walls, floor slab and
building construction; (6) Penstock manifold with four branches to
each of the four turbines with its associated flanges, bolts,
drains, couplings and thrust block; (7) four Allis Chalmers
insolation valves with operators and their associated motors and
controls: A) two 24" valves, and B) two 30" valves; (8) four
Ingersol-Rand Horizontal Francis Turbines: A) Turbine #1: capacity
548 KW, model 16 x 23 ST; B) Turbine #2: capacity 686 KW, model 16
x 23 ST; C) Turbine 23: capacity 767 KW, model 16 x 23 S; and D)
Turbine #4: capacity 911 KW, model 20 ALVT; (9) four Westinghouse
Horizontal Induction Generators: A) Generator #1 - capacity 617 KW;
B) Generator #2 capacity 776 KW; C) Generator #3 - capacity 882 KW;
D) Generator #4 - capacity 1048 KW; (10) one Power Factor Assemble;
(11) Westinghouse Generator Controller Equipment (12) one Neutral
Grounding Resistor Assembly; (13) one 3500 KVA Transformer and
accessories; (14) one Indoor Station Auxiliary Transformer with a
service panelboard for powerhouse loads; (15) one Programmable
controller package - built by J-U-B Engineers, Inc.; and (16) 7,313
lineal feet of 46 KV transmission line.
Seller believes but does not warrant (and has not attempted
to
verify) that the equipment described above is an accurate
description of the equipment
located at the Facility.
EXHIBIT A - PAGE 2
All of Seller's right to and interest in all permits, licenses,
governmental approvals, contracts and agreements necessary for or
used in connection with the ownership, development and operation of
the Facility and the transmission and sale of electric power to
Idaho Power Company, including, without limitation, those documents
identified below:
A. Permits
1. All FERC Licenses relating to the Facility pursuant to the
Order Issuing Major License issued May 24, 1985, Project No.
8278-000, by the Office of Electric Power Regulation, Federal
Energy Regulatory Commission, as may have been amended.
2. All Water Permits issued by the State of Idaho relating to
water for the Facility, including but not limited to the Idaho
Department of Water Resources Water Permit Nos. 4707768, 47-07991,
47-08005 and 47-8009.
B. Contracts.
1. The Firm Energy Sales Agreement between Seller and Idaho
Power Company dated March 31, 1984.
2. Intertie Agreement dated October 3, 1985, between Seller
and Mistletoe Financial Company, a Utah general partnership.
3. - Lease Agreement dated as of May l, 1985, between Derek
C.
Cantrell, Georgia Lee Cantrell, Charles Cantrell and Vivian
Cantrell, as Lessor, and Seller, as Lessee.
4. Lease Agreement dated as of May 1, 1985, between Patricia
Wilson Sibley, Samuel H. Sibley, Asher B. Wilson, Jr., Asher B.
Wilson m, Clark S. Wilson, James Edward Wilson, Mark L. Wilson, and
David R. Millard and Barbara L. Millard, as Lessor, and Seller, as
Lessee.
5. Right of Way Grant dated June 19, 1983, executed by Twin
Falls Bank and Trust, David R. Millard, Barbara L. Millard, and
Pisces Investments, as grantors, to Seller, as grantee.
6. Perpetual Easement Agreement dated June 19, 1985, between
Twin Falls Bank & Trust Company, Crystal Springs Ranch, Ltd., and
Pisces Investments, as grantors, and Seller, as grantee.
7. Agreement dated March 8, 1993, between Twin Falls Canal
Company, an Idaho corporation, and Seller, concerning added Rows.
8. Any and all insurance policies presently in force
concerning or relating to the Facility or its operation.
EXHIBIT B
<PAGE>
Exhibit (10) (aak)
RELEASE OF ALL CLAIMS
KNOW ALL MEN BY THESE PRESENTS:
1. That the undersigned, CRYSTAL SPRINGS RANCH G LIMITED
PARTNERSHIP, an Idaho Limited Partnership, ("Releasor") by and
through its General Partner, Crystal Springs Ranch, L.L.C., for and
in consideration of the sum of $69,000.00, and other good and
valuable consideration, the receipt and sufficiency of which is
hereby unconditionally acknowledged, does hereby release, acquit
and forever discharge FIRST SECURITY BANK OF UTAH, N.A., and its
successors, representatives, insurers, assigns, agents, attorneys,
servants, employees, officers, directors, and any person or persons
acting for, by or through it, ("Releasee) of and from all Released
Claims (as hereinafter defined) in any way having to do with,
arising, arisen, to arise, or which may arise out of or in any way
connected with, directly or indirectly, that certain Lease
Agreement dated May 1, 1985, by and between Patricia Wilson Sibley,
Samuel H. Sibley, Asher B. Wilson, Jr., Asher B. Wilson, III, Clark
S. Wilson, James Edward Wilson, Mark L. Wilson, David R. Millard
and Barbara L. Willard, as lessors, ("Original Lessors") and
Crystal Springs Hydroelectric Company, an Idaho general
partnership, as lessee, ("Original Lessee") and recorded June 24,
1985, as Instrument No. 883276, records of Twin Falls County, Idaho
(the Original Lease").
2. For purposes of this Agreement, the following terms have
the following meanings, which apply to both the singular and plural
forms of the terms defined:
"Agreement" means this Release of Claims.
"Applicable Environmental Laws" means any statutory law or
case law (federal, state or local) pertaining to the environment,
or petroleum products, or oil, or asbestos, or hazardous
substances, including, without limitation, the Comprehensive
Environmental Response, Compensation and Liability Act of 1980
("CERCLA"), as codified at 42 U.S.C. 9601 et. seq.; the Resource
Conservation and Recovery Act of 1976 as amended, as codified at
U.S.C. 6901 et. sec.; and the Superfund amendments and
Reauthorization Act of 1986, as codified at 42 U.S.C. 9671 et. seq.
"Environmental Claims means all claims, causes of action,
costs, expenses, judgments, fines, charges, fees, expenses,
damages, losses, liabilities and/or response costs arising from or
pertaining to the application of any Applicable Environmental Laws
relating in any way to the Property and/or the Project.
"Project" means the hydroelectric generating facility known
as
the Crystal Springs Hydroelectric Project, also known as the Cedar
Draw Hydroelectric Project located on or near the Property,
including, without limitation, the diversion structure, penstock,
powerhouse, tailrace, transmission lines, equipment and
improvements appurtenant thereto, the rights to use all access
easements relating thereto, all contracts, contract rights and
agreements relating to or required for the refurbishment, use,
occupancy and/or operation of the Project, together with all
authorizations, approvals and permits relating thereto.
"Property" means that certain real property and easement as
more particularly described in Exhibit "A" attached hereto.
"Released Claims" means all claims of whatever kind and
nature, known and unknown, occurring and existing before the date
of this Agreement and in anyway connected with the Original Lease,
the Property or the Project.
3. Subject to the terms of this Agreement, it is the
intention
of Releasor that this Agreement shall be effective as a full and
final accord and satisfaction and release of all Released Claims.
Releasor is aware that it may hereafter discover facts in addition
to or different from those which it now knows or believes to be
true with respect to the subject matter of this Agreement, but,
except as provided for in this Agreement, it is the intention of
Releasor to hereby fully, finally and forever release all Released
Claims, known or unknown, and that the release provided for herein
shall be and remain in full force and effect as a full and complete
general release with respect to all Released Claims notwithstanding
the discovery of or the existence of any such additional or
different facts or any additional or different defects or damages
of any kind
4. It is understood and agreed that this settlement is the
compromise of a doubtful and disputed claim, and that the payment
is not to be construed as an admission of liability on the part of
the parties hereby released, and that Releasee denies liability
therefor and intends merely to avoid litigation and buy their
peace.
5. It is understood and agreed by Releasor that this
Agreement
is made and entered into as a free and voluntary act of the
Releasor in the exercise of its own judgment, belief and knowledge
of the nature, extent and duration of the said claim or claims and
damages, and is not made or entered into under the influence of
Releasee or any attorney, representative, agent, or other person
acting for, through or on behalf of Releasee, and that neither
Releasee, nor any other person, has induced or influenced Releasor
to enter into this Agreement.
6. Releasor acknowledges and agrees that it is, and has been,
represented by counsel of its own choosing during any and all
negotiations which have led to this Agreement, and that it has been
fully advised concerning the effect of this Agreement, the amount
of the settlement, and its obligations contained in this Agreement.
RELEASE OF ALL CLAIMS - 2
7. Releasor represents and warrants to Releasee that Releasor
is the sole successor in interest to all Original Lessors under the
Original Lease, and the undersigned has all requisite power and
authority to execute this Agreement on behalf of Releasor and that
this Agreement, when executed, will constitute a legal and binding
agreement fully enforceable against Releasor according to its
terms.
8. It is further understood and agreed that this Agreement
shall be binding upon the successors and assigns of Releasor.
9. RELEASOR HAS READ THE FOREGOING AGREEMENT, FULLY
UNDERSTAND
IT, AND AGREES TO ALL THE COVENANTS, TERMS AND CONDITIONS CONTAINED
HEREIN.
IN Witness WHEREOF, the undersigned has hereunto executed this
Agreement this
7th day of March , 1995.
RELEASOR: CRYSTAL SPRINGS RANCH G LIMITED)
PARTNERSHIP By,Cres al Springs Ranch,
L.L.C.
Its General Partner
By /s/
Name: David R. Millard
Its: Managing Member
STATE OF IDAHO )
: ss.
COUNTY OF ADA )
On the 7th day of March, 1995, before me the undersigned, a
Notary Public in and for the State, personally appeared David R.
Millard, known or identified to me to be the Managing Member of
Crystal Springs Ranch, L.L.C., the General Partner of Crystal
Springs Ranch fi Limited Partnership, a limited partnership, the
partnership that executed the foregoing instrument or the person
who executed the foregoing instrument on behalf of said
partnership, and acknowledge to me that such partnership executed
the same.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed
my
official seal the day and year first above written.
/s/
Notary Public
Residing at Boise
My commission expires 5-8-98
PARCEL V
Township 9 South, Range 15 East of the Boise Meridian, Twin Falls
County, Idaho,
SECTION 12: S1/2NW1/2SW1/4, S1/2SW1/4, Government Lots 5 and 6 and
that part of Government Lot 7 and the SW1/4SE1/4 lying West of the
following described line:
BEGINNING at a point on the South boundary of said SW1/4SE1/4 which
bears South 88 52' 12" East a distance of 379.76 feet from the
Southwest corner of said SW1/4SE1/4; THENCE North 15 33' 41" East
a distance of 954.11 feet; THENCE South 80 53' 55" East a distance
of 63.94 feet; THENCE North 17 27' 10" East a distance of 806.89
feet to the approximate high water mark of the Snake river and the
Northerly boundary of said Lot 7.
SECTIONS 11, 12 and 14: Tract A and Block 1 of the CRYSTAL SPRINGS
ESTATES SUBDIVISION as recorded in Book 12, page 49 of the Plat
Records of Twin Falls County, Idaho; and also the NW1/4NE1/4,
Section 14, EXCEPT that part of the West of the West Rim of Cedar
Draw Canyon.
EXCEPT
A parcel of land located in the SW1/4SW1/4 of Section 12, Township
9 South, Range 15 East of the Boise Meridian, Twin Falls County,
Idaho and being more specifically described as follows:
COMMENCING at the Southwest section corner of Section 12, Township
9 South, Range 15 East of the Boise Meridian; THENCE North 2 34'
14" East, 984.53 feet to the REAL POINT OF BEGINNING; THENCE South
77 08' 45" East, 113.00 feet; THENCE North 22 47' 38" East,
111.02 feet; THENCE North 10 02' 13" East, 30.05 feet; THENCE
North 76 35' 05" West, 154.55 feet; THENCE South 8 05' 51" West,
30.13 feet; THENCE South, 1 56' 46" West, 112.90 feet to the REAL
POINT OF BEGINNING.
AND EXCEPT
A parcel or land located in portions of Lot 7 and the NE1/4SE1/4
of Section 11; Lots 9 and 10 and the NW1/4SW1/4 of Section 12, all
in Township 9 South, Range 15 East of the Boise Meridian, Twin
Falls County, Idaho and being more specifically described as
follows:
COMMENCING at the southwest Section Corner or Section 12,Township 9
South, Range 15 East of the Boise Meridian; THENCE North 7 09' 05"
West, 1,383.37 feet to the REAL POINT OF BEGINNING; THENCE North
7 01' 47" East, 780.97 feet; THENCE North 84 24' 21" west 22.22 feet;
THENCE North 530 44' 40" West, 717.69 feet; THENCE North 83 .07' 31"
West, 284.71 feet; THENCE North 10 38' 43" East, 411.55 feet to the highwater
line on the Southerly bank of the Snake River; THENCE Southeasterly
along the Southerly bank or the Snake River the following courses
and distances; South 83 45' 43" East, 81O.89 feet; South 79 02' 15" East,
395.38 feet; South 53 01' 23" East, 563.77 feet; South 3 34' 55" East
143.37 feet; South 50 33' 57" East, 75.85 feet; THENCE South 27 06' 46"
West, 464.20 feet; THENCE North 81 09' 24" West, 670.66 feet; THENCE South
13 08' 09" West, 699.75 feet; Thence North 78 38' 10" West, 242.61 feet
to the REAL POINT OF BEGINNING. AND ALSO EXCEPT A parcel of land in the
S1/2SW1/4, Section 12, Township 9 South, Range 15 East of the Boise
Meridian, Twin Fails County, Idaho, and being more specifically described
as follows: COMMENCING at the Southwest corner of Section 12,
Township 9 South., Range 15 East of the Boise Meridian; THENCE North
40 48' 33" East, 1460.47 feet to the REAL POINT OF BEGINNING; THENCE
from this REAL POINT OF BEGINNING, North 3O 47' 50" East, 150.00
feet; THENCE: South 82O 12' 10" East, 290.60 feet; THENCE South 3
47' 50" West, 150.00 feet; THENCE North 82 12' 1O" West, 290.60 feet to
the REAL POINT OF BEGINNING.
AND ALSO EXCEPT
A parcel of land in the NE1/4NE1/4, Section 14, Township 9 South
Range 15 East of the Boise Meridian, and the S31/4SE1/4 of
Section 11 Township 9 South, Range 15 East of the Boise Meridian,
Twin Falls County, Idaho and being more specifically described as
COMMENCING at the Section Corner common to Sections 11, 12, 13 and
14 Township 9 South, Range 15,East of the Boise Meridian THENCE
North 1 28' 00" East a distance or 110.32 feet along the East
boundary of said Section 11 to the REAL POINT OF BEGINNING; THENCE
North 1 28' 00" East a distance of 855.74 feet along the East
boundary of said Section 11; THENCE North 79 27' 06" West a
distance of 131.32 feet along the centerline of a county road
THENCE South 5 16' Al" West a distance of 533.24 feet; THENCE
South 51 09' 47" West a distance or 510.97 feet; THENCE South 45
37' 48" West a distance of 567.18 feet; THENCE South 43 20' 21"
West a distance of 473.32 feet; THENCE South 42 23' 20" West a
distance o 99.09 feet to the West boundary of the NE1/4NE1/4 of
said Section 14; THENCE South 0 48' 50" West a distance of 719.47
feet along the West boundary of the NE1/4NE1/4 of said Section 14
to the Southwest corner of the NE1/4NE1/4 of said Section 14;
THENCE North 37 45' 47" East a distance of 115.90 feet; Thence
North 22 30' 41". East a distance of 263.89 feet; THENCE North 45
30' 52" East a distance of 230.52 feet; THENCE North 45 27' 59"
East a distance of 427.46 feet; THENCE North 9 12' 00" East a
distance of 285.25 feet; Thence North 69 04' 07" East a distance
of 280.22 feet; THENCE North 21 21' 02" East a distance of 285.25
feet; THENCE North 27 32' 50" East a distance of 204.83 feet to
the REAL POINT OF BEGINNING.
AND ALSO SUBJECT TO an easement for the purpose of ingress and
egress over a strip of land 60 feet in width along an existing road
and located in the SW1/4SW1/4 of Section 12, the S"-l/SE1/4 of
Section 11, the NE1/4NE1/4 and the NW1/NE1/4 Section 14, Township
9 South, Range 15 East or the Boise Meridian, Twin Falls County,
Idaho said easement lying 30 feet on each side of the following
described centerline:
BEGINNING at the corner common to Sections 11, 17, 13 and 14;
THENCE North 20 31' 05" East 601.33 feet to a Point on the
centerline or a county road and the TRUE POINT OF BEGINNING of said
easement; THENCE along said centerline the following courses and
distances South 45 00' 00" West 78.46 feet; THENCE South 30 22'
45" West 67.23 feet; THENCE South 43 40' 04" West 91.24 feet;
THENCE South 61 00' 15" East 56.34 feet to the Westerly boundary
of said SE1/4SE1/4 Section 12 and Easterly boundary of said
SE1/4SE1/4 Section 11; THENCE South 61 00' 15" West 38.56 feet;
THENCE South 51 48' 52" West 226.46 feet; THENCE South 30 57' 50"
West 52.48 feet; THENCE South 61 37' 51" West 113.65 feet; Thence
South 87 36' 51" West 48.04 feet; THENCE South 58 21' 19" West
101.02 feet; THENCE South 41 22' 28" West 71.50 feet to the
Southerly boundary of said SE1/4SE1/4 Section 11 and the Northerly
boundary of said NE1/4NE1/4 Section 14; THENCE South 41 22" 28"
West 185.70 feet: and the Southwesterly end of said easement.
PARCEL VI
RESERVING an easement for penstock and access road described as:
strip of land 300.00 feet in width located in the SW1/4NE1/4 and
W1/2SE1/4 of Section 14 and the NW1/4NE1/4 of Section 23, Township
9 South, Range 15 Bast of the Boise Meridian, Twin Falls County,
Idaho, said strip of land lying 100 feet Westerly and 200 feet
Easterly of the following described line:
BEGINNING at a point on the Northerly boundary of the SW1/4NE1/4 of
said Section 14 which point bears South 89 36' 05" West 254.37
feet from the Northeast corner thereof; THENCE South 38 13' 161'
West 467.86 feet to a point of curvature; THENCE Southwesterly
123.00 feet on the arc of a curve to the right with a radius of
200.00 feet, a central angle of 35 14' 12" and a chord which bears
South 55 50' 22" West 121.07 feet to a point of tangency; THENCE
South 73 27' 29" West 356.69 feet to a point of curvature; THENCE
Southwesterly 295.42 feet on the arc of a curve to the left with a
radius of 225.00 feet, a central angle of 75 83' 39" and a chord
which bears South; 35 50' 40" west 274.65 feet to a point of
tangency; THENCE South 1 46' 09" mast 693.24 feet to a point of
curvature THENCE Southeasterly 316.35 feet on the arc of a curve to
the left with a radius of 350.00 feet, a central angle of 51 47'
15" and a chord which bears South 27 39' 45" East 305.69 feet to
a point of tangency; THENCE South 53 33' 20" East 401.63 feet to
a point of curvature; THENCE Southeasterly 295.13 feet on the arc
of a curve to the right with a radius of 375.00 feet, a central
angle of 45 05' 36" and a chord which bears South 31 00' 22" East
287.58 feet to a point of tangency; THENCE South 8 27' 44" East
600.55 feet to a point of curvature; Thence Southwesterly 612.95
feet on the arc of a curve to the right with a radius of 954.93
feet, a central angle of 36 46' 38" and a chord which bears South
9 55' 35" West 602.49 feet to a point of tangency; THENCE South 28
18' 55" West 211.58 feet to a point of curvature; Thence Southerly
974.90 feet on the arc of a curve to the left with a radius or
818.51 feet, a central angle of 68 14' 35" and a chord which bears
South 5 48' 23" East 918.29 feet to a point of tangency; THENCE
south 39 55' 52" East 4.26 feet to a point of curvature; THENCE
Southerly 309.14 feet on the arc of a curve to the right with a
radius of 450.00 feet, a central angle of 39 21' 38" and a chord
which bears South 2O 14' 51" East 303.09 feet to a Point of
tangency; THENCE South 0 34' 03" East 48.88 feet to a point of
curvature; THENCE Southerly 176.70 feet on the arc of a curve to
the left with a radius of 225.0O feet, a central angle of 44 59'
47" and a chord which bears South 23 03' 57" East 172.19 feet to
a point of tangency; THENCE South 45 33' 54" East 12.20 feet to a
point of curvature; THENCE Southerly 121.15 feet on the arc of a
curare to the right with a radius of 275.00 feet, a central angle
of 66 54' 38' and a chord which bears South 12 06' 35" East
303.21 feet to a point of tangency; THENCE South 21 20' 45" west
27.27 feet to a point on the Southerly boundary of said NW1/4NE1/4
of Section 23, which bears North 89 45' 45" West 242.84 feet from
the Southeast corner thereof and the Southerly end of said 300 foot
wide strip of land.
The sidelines shall be lengthened or shortened to intersect the
Northerly boundary of the SW1/4NE1/4 of said Section 14 and to intersect
the Southerly boundary of the NW1/4NE1/4 of said Section 23, which boundaries
shall constitute the Northerly and Southerly boundaries of the herein
described land.
PARCEL VII
That part of the SW1/4NE1/4 Section 23, Township 9 South,
Range 15 East of the Boise Meridian, Twin Falls County, Idaho,
lying East of the existing farm dirt road on the immediate west
side of the Cedar Draw Canyon Rimrock.
<PAGE>
Crystal Springs Hydroelectric, L.P.
11225 S.w. 6th, Suits 100
Bellevue, Washington 98004
March 15, 1995
First Security Bank of Utah, N.A.
79 South Main Street, 11th Floor
Salt Lake City, Utah 84111
Attn: Walter P. Zoellner
Re: Crystal Springs Hydroelectric Project
Gentlemen:
Concurrently with the execution of this letter, Crystal
Springs Hydroelectric, L.P., a Washington limited partnership
("Purchaser"), is buying substantially all of the assets of Crystal
Springs Hydroelectric Company, an Idaho general partnership
("Seller"), relating to the Crystal Springs Hydroelectric project
in Twin Falls County, Idaho (the "Project"). We understand that
First Security Bank of Utah, N.A. ("First Security") has been the
principal lender to the Seller in connection with the Project, and
that First Security's loans have been secured by liens on
substantially all of the Project assets. In connection with our
purchase of the Project from the Seller and the payment to First
Security of substantially ail of the sale proceeds, we also
understand that First Security will be releasing its liens on the
Project assets.
As a condition to First Security consenting to the sale of
the Project to the_ Purchaser and as an inducement to First Security
releasing its liens on the Project assets, Purchaser hereby
represents and warrants to First Security as follows.
Purchase acknowledges that First Security has made and makes
no representations or warranties of any kind to Purchaser with
respect to the Project, the Seller or any other matters relating
thereto or to the purchase of the Project by the Purchaser. Without
limiting the generality of the foregoing, First Security has made
and makes no representations or warranties concerning the value,
condition or viability of the Project, the status of title to the
Project assets or the existence or priority of any liens on the
Project assets (other than First Security's own liens in the
Project assets which are being released in connection with
Purchasers acquisitions of the Project). Prior to the day hereof,
Purchaser has inspected and reviewed all matters relating to the
Seller and the Project and has made all inquires with respect
thereto that purchaser has deemed necessary to consummate its
purchase of the Project. Purchaser is relying on its own
investigation of such matters and is not relying on any
representation or warranty of any kind by First Security (except
with respect to First Security's release of its liens upon payment
to First Security of the amounts contemplated in the escrow
instruction; governing the closing) in entering into and
consummating the contemplated transactions.
As a further condition to First Security consenting to the
sale of the Project to Purchaser and releasing its liens on the
Project assets, Purchaser, for itself and its successors and
assigns, hereby releases First Security and its officers,
directors, employees and agents from any and all claims, liability,
damages, costs and expenses of any kind relating to the Project,
the Sellar and/or Purchasers acquisition of the Project assets.
Very truly yours,
CRYSTAL SPRINGS HYDROELECTRIC, L.P., a Washington limited
partnership
By: Gateway Energy, Inc., its general partner
By: /s/
Dell E. Keehn, President
<PAGE>
Exhibit (1O) (aal)
CONSENT TO ASSIGNMENT
THIS CONSENT TO ASSIGNMENT ('Consent") dated as of the 15th day of
March, 1995, is by and between IDAHO POWER COMPANY, and Idaho
corporation ("Idaho Power"), CRYSTAL SPRINGS HYDROELECTRIC COMPANY
(the "Assignor"), and CRYSTAL SPRINGS HYDROELECTRIC, L.P., A
Washington Limited Partnership authorized to do business in the
State of Idaho (the "Assignee").
RECITALS
WHEREAS, Assignor is the Seller under theat certain Firm Energy
Sales Agreement dated March 31, 1984 (the "Agreement"), between the
Assignor and Idaho Power, and
WHEREAS, the Assignor desires to assign the Agreement to Assignee;
and
WHEREAS, under the Agreement the Assignor, as Seller under the
agreement, is obligated to obtain Idaho Power's consent to assign
the Agreement
NOW, THEREFORE, in consideration of the foregoing premises, the
covenants herein mentioned to be kept and performed and other good
and valuable consideration, the parties hereby agree as follows:
ARTICLE 1
CONSENT
SECTION 1.1 CONSENT TO ASSIGNMENT pursuant to Article XXIII of
the Agreement, Idaho Power hereby consents to the assignemnt of the
Agreemnt from the Assignor to Assignee.
ARTICLE 2
AGREEMENTS
SECTION 2.1 IDAHO POWER NON-PARTY STATUS. Idaho Power is not a
party, nor is it bound by any agreement (other than this Consent)
between the Assignor and Assignee.
SECTION 2.2 ARRANGEMENTS REGARDING PAYMENTS. All payments to be
made by Idaho Power to the Assignee as Seller under the Agreement
shall be made at the following address:
Crystal Springs Hydroelectric, L.P.
11225 SE 6th
Bellevue, WA 98004
(or to such other person and/or at such other address as Assignee
may subsequently notify Idaho Power in Writing).
ARTICLE 3
MISCELLANEOUS PROVISIONS
SECTION 3.1 ILLEGALITY If any clause or provision herein
contained operates or would prospectively operate to invalidate
this Agreement in whole or in part, then such clause or provision
only shall be void, as though not herein contained, and the
remainder of this Agreement shall remain operative and in full
force and effect.
SECTION 3.2 AMENDMENTS, CHANGES AND MODIFICATIONS This Agreement
may not be amended, changed, modified, altered or terminated except
by a written instrument executed by all the parties hereunto.
SECTION 3.3 EXECUTION OF COUNTERPARTS This Agreement may be
executed in several counterparts, each of which shall be an
original and all of which shall constitute but one and the same
instrument.
SECTION 3.4 VENUE AND LAW GOVERNING This Agreement shall be
interpreted and governed by the laws of the State of Idaho. The
venue for any litigation arising out of the Agreement shall be the
District Court of the Fourth Judicial District in and for the
County of Ada, Idaho.
SECTION 3.5 OTHER AGREEMENTS This Agreement is integrated and
contains the entire agreement of the parties, no representations,
inducements, promises or agreements, oral or otherwise, not
embodied herein, shall be of any force or effect, except to the
extent that the same are contained in this Agreement or the
documents executed to effectuate the terms and conditions of this
Agreement.
SECTION 3.6 LEGAL REPRESENTATION Each party hereto acknowledges
and agrees that (i) it is, and has been represented by counsel of
its own choosing during any and all negotiations which have led to
this Agreement, and that it has been fully advised concerning the
effect of this Agreement and its obligations contained in this
Agreement, or (ii) it has entered freely and voluntarily into this
Agreement, and has chosen not to be represented and advised by
independent counsel.
SECTION 3.7 TIME OF ESSENCE Time and prompt performance of each
provision of this Agreement is of the essence.
SECTION 3.8 WAIVER A waiver by one party hereto of one or several
defaults in performance of any provision of this Agreement to be
performed by any other party hereto shall not construed as being a
waiver of such provision itself or any subsequent default in
performance thereof or the provisions of this paragraph.
SECTION 3.9 BINDING EFFECT The Agreement herein applies to and
binds each personal representative, executor, administrator, heir,
devise, legatee, assignee, transferee, successor and assign of the
respective parties hereto.
SECTION 3.10 NOTICES
SECTION 3.10.1 Idaho Power and Assignee hereby amend Article XXVI
of the Agreement to provide that all notices under the Agreement
will be sent to Assignee at the address specified below:
SECTION 3.10.2 All notices, certifications or other communications
hereunder shall be sufficiently given and shall be deemed given
when delivered or when mailed by certified mail, postage prepaid,
return receipt requested, addressed to Idaho Power or Assignee at
the following address:
if to Idaho Power: 1221 W Idaho Street
P.O. Box 70
Boise, Idaho 83707
Attn. Vice President-Power Supply
if to Assignee: Crystal Springs Hydroelectric, L.P.
c/o Weatherly
11225 SE 6th
Bellevue, WA 98004
IN WITNESS WHEREOF, the parties hereto have duly executed this
Consent as of the date first above written.
IDAHO POWER COMPANY
/s/
ASSIGNOR
CRYSTAL SPRINGS HYDROELECTRIC COMPANY
/s/
ASSIGNEE
CRYSTAL SPRINGS HYDROELECTRIC L.P.
/s/<PAGE>
Exhibit (10) (aam)
CONSENT AND Agreement
The CRYSTAL Springs HYDROELECTRIC COMPANY, an Idaho general
partnership (the 'partnership"), as the lessee under the Lease
Agreement recorded June 24, 1985, as Instrument No. 883276, records
of Twin Falls County, Idaho (the original Lease"), does hereby
consent and agree to all of the modifications to the Original Lease
contained in the above Amended Lease Agreement and to the
substitution of CRYSTAL Springs HYDROELECTRIC, L.P., a Washington
limited partnership, for the Partnership, as lessee thereunder.
The undersigned further warrant and represent to the
above-named Lessor and Lessee that Far West Capital, Inc., a Utah
corporation, and Far West Electric Energy Fund, L.P., a Delaware
limited partnership, are all of the general partners of the
Partnership with full power and authority to execute this Agreement
and bind the Partnership in all respects.
DATED this 1 5th day of , March , 1995.
CRYSTAL SPRINGS HYDROELECTRIC COMPANY
By: Far West Electric Energy Fund, L.P., a Delaware limited
partnership, as General Partner
By Far West Capital, Inc. a Utah corporation as general partner
/s/ Thomas A Quinn Vice President
By: Far West Capital, Inc., a Utah corporation as General Partner
/s/ Thomas A Quinn, Vice President<PAGE>
ASSIGNMENT OF INTEREST
For the sum of Twenty-Five Thousand Dollars ($25,000) and
other good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, CRYSTAL SPRINGS RESEARCH &
DEVELOPMENT, an Idaho general partnership, and CRYSTAL SPRINGS
TRUST, an Idaho Trust, under Trust Agreement dated effective April
1, 1985, Walker and Atkinson Chartered, Trustee, as assignors
("Assignors") hereby assign, transfer, grant, convey and quit claim
to Far West Electric Energy Fund, L.P., a Delaware limited
partnership as assignee ("Assignee") all of Assignors' right title
and interest in and to the Crystal Springs Hydroelectric Project,
also known as the Cedar Draw Hydroelectric Project, or Cedar Draw
Creek Project which is located on Cedar Draw Creek in Twin Falls
County, Idaho ("Project").
This Assignment, transfer and conveyance includes, but is not
limited to, all of Assignors' rights, title and interest under that
certain Purchase Agreement entered into effective as of the 1 5th
day of May, 1985 by and among Assignors, Bonneville Pacific
Corporation and Far West Capital, Inc., specifically including, but
not limited to, rights to receive royalties from the Project or to
repurchase the Project and Assignors hereby waive and quitclaim any
and all other right, title or interest whatsoever in the Project,
including Crystal Springs Hydroelectric Company Partnership Units,
equipment, business interests, good will, assets, titles, permits,
applications, licenses, leases, agreements, power contracts, water
permits, rents, royalties, distributions, revenues, options of any
kind, and any other interest, whether the same be present, past,
future, known or unknown.
The person signing for Assignors warrants that he and both
Assignors have the right and authority to execute and make this
Assignment of Interest with the consent and approval of the
beneficiaries and partners thereof and agrees to indemnify and hold
Assignee harmless from any claim, loss, damage or expense including
attorneys' fees resulting from any breach hereof.
Assignee hereby accepts and receives the foregoing assignment,
transfer and conveyance.
This Assignment of Interest contains the entire agreement of the
parties and shall
bind and inure to the benefit of all heirs, successors and assigns
of the parties hereto.
IN WITNESS WHEREOF, Assignors and Assignee have executed this<PAGE>
Exhibit ( 10 ) (aan)
ASSIGNMENT OF INTEREST
For the sum of Twenty-Five Thousand Dollars ($25,000) and
other good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, CRYSTAL SPRINGS RESEARCH &
DEVELOPMENT, an Idaho general partnership, and CRYSTAL SPRINGS
TRUST, an Idaho Trust, under Trust Agreement dated effective April
1, 1985, Walker and Atkinson Chartered, Trustee, as assignors
("Assignors") hereby assign, transfer, grant, convey and quit claim
to Far West Electric Energy Fund, L.P., a Delaware limited
partnership as assignee ("&Q.signee") all of Assignors' right title
and interest in and to the Crystal Springs Hydroelectric Project,
also known as the Cedar Draw Hydroelectric Project, or Cedar Draw
Creek Project which is located on Cedar Draw Creek in Twin Falls
County, Idaho ("Project").
This Assignment, transfer and conveyance includes, but is not
limited to, all of Assignors' rights, title and interest under that
certain Purchase Agreement entered into effective as of the 15th
day of May, 1985 by and among Assignors, Bonneville Pacific
Corporation and Far West Capital, Inc., specifically including, but
not limited to, rights to receive royalties from the Project or to
repurchase the Project and Assignors hereby waive and quitclaim any and
all other right, title or interest whatsoever in the Project, including
Crystal Springs Hydroelectric Company Partnership Units, equipment,
business interests, good will, assets, titles, permits, applications,
licenses, leases, agreements, power contracts, water permits, rents,
royalties, distributions, revenues, options of any kind, and
any other interest, whether the same be present, past, future,
known or unknown.
The person signing for Assignors warrants that he and both
Assignors have the right and authority to execute and make this
Assignment of Interest with the consent and approval of the
beneficiaries and partners thereof and agrees to indemnify and hold
Assignee harmless from any claim, loss, damage or expense including
attorneys' fees resulting from any breach hereof,
Assignee hereby accepts and receives the foregoing
assignment, transfer and conveyance.
This Assignment of Interest contains the entire agreement of the
parties and shall bind and inure to the benefit of all heirs, successors
and assigns of the parties hereto.
IN WITNESS WHEREOF, Assignors and Assignee have executed this
Assignment of Interest the 17th day of February 1995 by and through
their authorized representatives.
ASSIGNORS:
CRYSTAL SPRINGS TRUST
By: WALKER & ATKINSON CHARTERED,
/s/ Thomas G. Walker Its: President
CRYSTAL SPRINGS RESEARCH AND DEVELOPMENT
By: /s/ Thomas G. Walker, Jr. Its: General Partner
ASSIGNEE:
FAR WEST ELECTRIC ENERGY FUND, L.P. By: FAR WEST CAPITAL, INC. It:
General Partner
/s/ Thomas Quinn, Vice President<PAGE>
Exhibit (10) (aao)
CERTIFICATE: AS TO FULFILLMENT OF
CRYSTAL SPRINGS HYDROELECTRIC COMPANY ("Seller")
AND OBLIGATIONS
This certificate is made in response to Section 8.01 of the
Purchase and Sale Agreement (the "Agreement") by and among Crystal
Springs Hydroelectric, L.P. ("Purchaser") and the undersigned.
It is hereby certified by the undersigned that:
(a) All representations and warranties of the undersigned contained
in the Agreement
or the Exhibits or the documents described therein or otherwise
made in writing
pursuant to the Agreement are true and correct at and as of the
Closing Date (as
defined in the Agreement); and
(b) The undersigned has performed and complied with all the
covenants, agreements,
obligations and conditions required, by the Agreement to be
performed or complied with by the undersigned at or prior to the
Closing Date.
Dated: March 15, 1995
CRYSTAL SPRINGS HYDROELECTRIC COMPANY
By: Far West Electric Energy Fund, L.P., a Delaware limited
partnership, as General Partner
By: Far West Capital, Inc. General Partner
By: /s/
Thomas A. Quinn Vice President
<PAGE>
Exhibit (10) (aap)
CERTIFICATE AS TO FULFILLMENT
OF CRYSTAL SPRINGS HYDROELECTRIC, L.P.
("Purchaser") CONDITIONS
This certificate is made in response to Section 9.01 of the
Purchase and Sale Agreement (the "Agreement") by and among Crystal
Springs Hydroelectric Company ("Seller") and the undersigned.
It is hereby certified by the undersigned that:
(a) All representations and warranties of the
undersigned contained in the Agreement or otherwise made in writing
pursuant to the Agreement are true and correct at and as of the Closing
Date (as defined in the Agreement), except for changes
contemplated or permitted by the Agreement; and
(b) The undersigned has performed and complied with all
of the obligations and conditions required by the Agreement to be performed
or complied with by the undersigned at or prior to the Closing Date.
Date: March 2, 1995
CRYSTAL SPRINGS HYDROELECTRIC, L.P.
("Purchaser")
By: Gateway Energy, Inc., its general partner
By: /s/
Dell E. Keehn, President
<PAGE>
Exhibit (10) (aaq)
RELEASE OF ALL CLAIMS
KNOW ALL MEN BY THESE PRESENTS:
1. That the undersigned, CRYSTAL SPRINGS HYDROELECTRIC
COMPANY, FAR WEST ELECTRIC ENERGY FUND, L.P., and FAR WEST CAPITAL,
INC., (collectively "Releasers") for good and valuable
consideration, the receipt and sufficiency of which is hereby
unconditionally acknowledged, do hereby release, acquit and forever
discharge CRYSTAL SPRINGS RANCH G LIMITED PARTNERSHIP, an Idaho
Limited Partnership, and its successors, representatives, insurers,
assigns, agents, attorneys, servant, employees, officers,
directors, and any person or persons acting for, by or through it
(collectively "Releasee") of and from all Released Claims (as
hereinafter defined) in any way having to do with, arising, arisen,
to arise, or which may arise out of or in any way connected with,
directly or indirectly, that certain Lease Agreement dated May 1,
1985, by and between Patricia Wilson Sibley, Samuel H. Sibley,
Asher B. Wilson, Jr., Asher B. Wilson, III, Clark S. Wilson, James
Edward Wilson, Mark L. Wilson, David R. Millard and Barbara L.
Millard, as lessors, ("Original Lessors") and Crystal Springs
Hydroelectric Company, an Idaho general partnership, as lessee,
("Original Lessee") and recorded June 24, 1985, as Instrument No.
883276, records of Twin Falls County, Idaho (the "Original Lease").
2. For purposes of this Agreement, the following terms have the
following meanings, which apply to both the singular and plural forms
of the terms defined:
"Agreement" means this Release of Claims.
"Applicable Environmental Laws" means any statutory law or case law
(federal, state or local) pertaining to the environment, or
petroleum products, or oil, or asbestos, or hazardous substances,
including, without limitation, the Comprehensive Environmental
Response, Compensation and Liability Act of 1980 ("CERCLA"), as
codified at 42 U.S.C. 9601 et. seq.; the Resource Conservation and
Recovery Act of 1976 as amended, as codified at U.S.C. 6901 et.
seq.; and the Superfund amendments and Reauthorization Act of 1986,
as codified at 42 U.S.C. 9671 et. seq.
"Environmental Claims" means all claims, causes of action, costs,
expenses, judgments, fines, charges, fees, expenseS, damages,
losses, liabilities and/or response costs arising from or
pertaining to the application of any Applicable Environmental Laws
relating in any way to the Property and/or the Project.
"Project" means the hydroelectric generating facility known as the
Crystal Springs Hydroelectric Project, also known as the Cedar Draw
Hydroelectric Project located on or near the Property, including, without
limitation, the diversion structure. penstock, powerhouse,
tailrace, transmission lines, equipment and improvements
appurtenant thereto, the rights to use all access easements
relating thereto, all contracts, contract rights and agreements
relating to or required for the refurbishment, use, occupancy
and/or operation of the Project, together with all authorizations,
approvals and permits relating thereto.
"Property" means that certain real property and easement as more
particularly described in Exhibit "A" attached hereto.
"Released Claims" means all claims of whatever kind and nature,
known and unknown, occurring and existing before the date of this
Agreement and in anyway connected with the Original Lease, except
for the following which shall not be released: any and all claims,
liabilities, causes of action, costs, attorney's fees and damages
of Releasor in any way related to fraud and/or Environmental
Claims.
3. Subject to the terms of this Agreement, it is the
intention of Releasors that this Agreement shall be effective as a full and
final accord and satisfaction and release of all Released Claims.
Releasors are aware that they may hereafter discover facts in
addition to or different from those which they now know or believe
to be true with respect to the subject matter of this Agreement,
but, except as provided for in this Agreement, it is the intention
of Releasors to hereby fully, finally and forever release all
Released Claims, known or unknown, and that the release provided
for herein shall be and remain in full force and effect as a full
and complete general release with respect to all Released Claims
notwithstanding the discovery of or the existence of any such
additional or different facts or any additional or different
defects or damages of any kind.
4. It is understood and agreed that this settlement is the
compromise of a doubtful and disputed claim, and that the payment
is not to be construed as an admission of liability on the part of
the partieS hereby released, and that Releasee denies liability
therefor and intends merely to avoid litigation and buy their
peace.
5. It is understood and agreed by Releasors that this
Agreement is made and entered into as a free and voluntary act of
the Releasors in the exercise of their own judgment, belief and
knowledge of the nature, extent and duration of the said claim or
claims and damages, and is not made or entered into under the
influence of Releasee or any attorney, representative, agent, or
other person acting for, through or on behalf of Releasee, and that
neither Releasee, nor any other person, has induced or influenced
Releasors to enter into this Agreement.
6. Releasors acknowledge and agree that they are, and have
been, represented by counsel of their own choosing during any and
all negotiationS which have led to this Agreement, and that they
have been fully advised concerning the effect of thiS Agreement,
the amount of the settlement, and its obligations contained in this
Agreement.
RELEASE OF ALL CLAIMS - 2
7. Releasors represent and warrant to Releasee that the
undersigned Far West Capital, Inc., and Far West Electric Energy
Fund, L.P., are the sole general partners of the Original Lessee
under the Original Note, and the undersigned have all requisite
power and authority to execute this Agreement on behalf of
Releasors and that this Agreement, when executed, will constitute
a legal and binding agreement fully enforceable against Releasors
according to its terms.
8. It is further understood and agreed that this Agreement
shall be binding upon the successors and assigns of Releasors.
9. RELEASORS HAVE READ THE FOREGOING AGREEMENT, FULLY
UNDERSTAND IT, AND AGREE TO ALL THE COVENANTS, TERMS AND CONDITIONS
CONTAINED HEREIN.
IN WITNESS WHEREOF, the undersigned have hereunto executed this
Agreement this
8th day of March, 1995.
RELEASOR: CRYSTAL SPRINGS HYDROELECTRIC
COMPANY, an Idaho General Partnership,
by its undersigned General Partners:
X
Far West Capital, Inc., a Utah Corporation, as General Partner
By /s/
Name: Alan 0. Melchior
Title: President
Far West Electric Energy Fund, L.P., a - Delaware Limited
Partnership, as General Partner
By: Far West Capital, Inc., General Partner
By: /s/ Thomas A. Quinn Vice President
FAR WEST ELECTRIC ENERGY FUND,
L.P., a Delaware Limited Partnership
By: Far West Capital, Inc., General
Partner
By /s/
Name: Thomas A. Quinn
Title: Vice President
FAR WEST CAPITAL, INC., a Utah Corporation
/s/
Name. Alan 0. Melchlor Title: President
<PAGE>
Exhibit (10) (aar)
RELEASE OF Security AGREEMENT
This Release of Security Agreement (the "Release") is
executed
as of the 15 day of March, 1995, by FIRST SECURITY BANK OF UTAH,
N.A. ("Bank").
Recitals
A. On July 7, 1988, Crystal Springs Hydroelectric Company, an
Idaho general partnership ("Crystal"), executed a Security
Agreement in favor of Bank (the "Original Agreement"), covering the
collateral described therein (the "Collateral"). Various UCC-1
financing statements were filed in Utah and Idaho to perfect the
security interests created by the Original Agreement. The Original
Agreement was amended pursuant to an Amendment to Security
Agreement, dated as of December 31, 1992, and as so amended the
Original Agreement is hereinafter referred to as the "Security
Agreement."
B. Bank has agreed to release the Collateral from the
Security Agreement and terminate the Security Agreement pursuant to this
Release.
Agreement
In consideration of the foregoing, and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Bank hereby releases the Collateral from the Security
Agreement and fully and completely releases and terminates the
Security Agreement. In addition, Bank agrees to execute such UCC
Termination Statements as are reasonably necessary to fully
effectuate the release of Bank's security interests in the
Collateral.
EXECUTED as of the date first written above.
FIRST SECURITY BANK OF UTAH,
NATIONAL ASSOCIATION
By: /s/<PAGE>
Exhibit (10) (aas)
THIRD EXTENSION AND MODIFICATION AGREEMENT
This Third Extension and Modification Agreement (the
"Agreement") is entered into as of March 15 , 1995, by and between
CRYSTAL SPRINGS HYDROELECTRIC COMPANY, an Idaho general partnership
("Crystal'), and FIRST SECURITY BANK OF UTAH, N.A. ("Lender").
Recitals
A. Far West Electric Energy Fund, L.P., a Delaware limited
partnership (Formerly known as Far West Hydroelectric Fund, Ltd. ,
a Utah limited partnership)(the "Fund'), is a general partner in
Crystal. Far West Capital, Inc. , a Utah corporation ("Far west
Capital") is a general partner in both Crystal and the Fund.
Thomas A. Quinn ("Quinn") and Alan O. Melchior ("Melchior") were
also individual general partners in the Fund until January 1, 1995,
when both Quinn and Melchior withdrew as general partners. crystal,
Far West Capital, the Fund, Melchior and Quinn are hereinafter
referred to collectively as the "Crystal Affiliates.
B. On ar about July 7 , 1988 , Crystal entered into a Credit
Agreement with Lender. Pursuant to the Credit Agreement, bender
made a loan of $2,800,000.00 to Crystal (the "Loan"). The Loan, was
evidenced by the following documents, all dated July 7, 1988, which
together with all other documents and agreements evidencing,
securing or otherwise relating to the Loan are hereinafter
collectively referred to as the "Original Loan Documents":
- Promissory Note
- Security Agreement .
- Mortgage, Assignment of Contract Rights, and Security Agreement
- Collateral Assignment of Water Rights
C. Performance under the Loan was guaranteed by Bonneville
Pacific Corporation with an Unconditional and Continuing Guaranty
dated July 7, 1988.
D, Effective December 31, 1992, Lender and the Crystal
Affiliates entered into an Extension and Modification Agreement
(the "First Amendment"), pursuant to which the maturity date of the
Loan was extended to December 1, 1993, and certain other terms of
the Original Loan Documents were modified Concurrently with the
execution on the First Amendment, the Crystal Affiliates and Lender
entered into an Agreement the "settlement Agreement") and a Mutual
Release Agreement, pursuant to which certain pending lawsuits
between the parties were settled, as more fully described in said
agreements.
E. In accordance with the terms of the First Amendment and
the Settlement Agreement, Lender made a new $50,000 loan to Crystal
(the "Repair Loan") to permit certain repairs to be made to the
Crystal Springs project. Various amendments to the Original Loan
Documents were executed in connection with the Repair Loan to cause
the cross-collateralization and cross-defaulting of the Repair Loan
with the Loan. The Repair Loan has been repaid,
F. Effective December l, 1993, Lender and the crystal
Affiliates entered into a Second Extension Agreement (the "Second
Amendment"), pursuant to which the maturity date of the Loan was
extended to September 1, 1994, and certain other terms of the
Original Loan Documents were modified. The Loan is currently in
default, Crystal having failed to repay the Loan at its maturity on
September 1, 1994. The Original Loan Documents as amended by the
First Amendment, the Settlement Agreement, the Second Amendment and
the other documents executed in connection therewith are
hereinafter referred to collectively as the "Loan Documents". The
original Promissory Note evidencing the Loan, as amended by the
First Amendment and the Second Amendment, is hereinafter referred
to as the "Note".
G. Concurrently with the execution of this Agreement, Crystal
is selling substantially all of its assets to Crystal Springs
Hydroelectric, L.P., a Washington limited partnership
("Purchaser"). The Crystal Affiliates have requested that Lender
consent to the proposed sale to Purchaser, accept a principal
payment under the Loan in the amount of $1,100,000.00, reduce the
remaining principal balance of the Note to $537,000.00, release all
collateral for the Loan and extend the term of the Loan for an
additional five (5) years, and Lender is willing to take such
actions, on the terms and conditions set forth in this Agreement.
Agreement
In consideration of the foregoing, the mutual covenants
contained herein and the benefits to be derived by the parties
hereunder, Lender and Crystal hereby agree as follows:
1, Status of Loan. Immediately prior to the execution of this
Agreement Crystal owed Lender $1,800,000.00 in outstanding
principal under the loan, together with $191,762.50 of accrued and
unpaid interest and approximately $3,300.00 of other related costs
and expenses.
2. Reduction of Loan Obligations and Release of Collateral.
Upon receipt by Lender of a principal payment on the Loan in the
amount of $1,100,000.00, (i) the Note and the other Loan Documents
shall be deemed modified wherever necessary to provide that the
remaining principal balance owed under the Loan shall be
$537,000.00 and interest and costs on the Loan shall be deemed
current as of the date hereof, and (ii) Lender shall execute
documents sufficient to release its liens and security interests in
the Project assets that have heretofore secured the Loan.
3. extension. Subject to the other provisions of this
Agreement, the date of the Loan is hereby extended by amending
the Note and each of the other Loan Documents wherever necessary to
provide that the unpaid principal balance of the Loan, accrued and
unpaid interest thereon and all other amounts due pursuant to the
terms of the Loan Documents shall be due and payable in Gull on
March 2, 2000. No provision of this Agreement shall be construed to
be a commitment by Lender to refinance or further extend the tern
of the Loan, and the parties hereby confirm that no such commitment
exists. Notwithstanding this extension, Crystal shall be liable to
mate the modified payments of interest required below.
4, Further Modifications. The Loan is hereby further modified
by amending the Note and each of the other Loan Documents wherever
necessary to provide as follows:
(a) effective as of the date hereof, the interest rate on the
Loan (as amended) is hereby modified to be a fluctuating per annum
rate equal to Lenders "Prime Rate" from time to time. Lender's Prime Rate
is its announced rate of interest used as a reference point from which it
may calculate the cost of credit to customers generally. The Prime Rate
is subject to change from time to time, Lender may make loans above, at or
below its Prime Rate, said rate not necessarily being the "best" or
"lowest" rate for pricing credit to Lender's customers.
(b) The repayment terms of the Loan are hereby modified to
require semiannual installment payments of interest only, payable
in arrears on the first day of each September and March, commencing
with September 1, 1995, and continuing thereafter throughout the
term of the Loan. All remaining principal and accrued and unpaid
interest shall be due an payable in full on March 2, 2000.
(c) The Loan, as amended hereby, shall be evidenced by an
amended and substituted promissory note (the ~Deficiency Note"),
dated of even date herewith, in the form of EXHIBIT A attached
hereto and incorporated herein by reference.
(d) If the Deficiency Note is paid in full within two years
after the date thereof, First Security will discount the amount of,
the principal due by $100,000 (requiring a principal payment of
only $487,000), and if the Deficiency Note is paid in full within
three years (but not sooner than two years), First Security will
discount the amount of the principal due by $50,000 (requiring a
principal payment of $487,000). If the Deficiency Note is paid
after the third anniversary thereof, there will be no discount
(requiring payment of the full principal amount of $537,000).
Moreover, if there is a default under the Deficiency Note or under
related loan documentation, no discount will be allowed.
5. Conditions to Extension and Modifications. The extension
and modifications provided for in this Agreement are expressly
conditioned on complete performance of the Following conditions by
the crystal Affiliates:
(a) Lender shall have received payment of the entire sale
proceeds from the sale by Crystal to Purchaser of the Project,
which proceeds shall be in the amount of at least $1,100,000.00.
Notwithstanding the foregoing, Lender acknowledges that the actual
proceeds to received by Lender shall be reduced by the sum of
$81,500.00, consisting of $69,000.00 that Lender has agreed to pay
at closing to certain ground lessors of the Project (the
"Millards") and $12,500.00 that Lender has agreed to pay at the
closing to the owners of a royalty interest on the Project (the
"royalty Owners") of the $537,000.00 original principal amount of
the Deficiency Note, $37,000.00 represents reimbursement to Lender
of the funds being paid by Lender to the Millards and the Royalty
Owners.
(b) Purchaser shall pay $25,000.00 to the Millards and
$12,500.00 to the Royalty Owners at the closing of the sa}e of the
Project from Crystal to Purchaser.
(c) Concurrently with the execution of this Agreement,
Crystal shall execute the Deficiency Note as the maker thereof, and each of
the other Crystal Affiliates shall execute the Deficiency Note in
their respective capacities as general partners in Crystal and the
Fund (as the case may be). Although Quinn and Melchior have
withdrawn as general partners in the Fund, each of them shall
continue to have general partner liability for the remaining
obligations under the Loan as if they had continued to be general
partners in the Fund, and each of then shall execute the Deficiency
Note for the purpose of confirming that continuing general partner
liability.
(d) Lender and the Crystal Affiliates hereby agree that any
revenues from the Project (as defined in the Loan Documents) that
might be held by mender in a Project account shall be paid to
Lender, and that Bender shall also be entitled to any refunds of
unearned insurance premiums prepaid with respect to the Project.
The parties acknowledge that such Sums will be applied by Lender
against the amounts over and above the principal amount of the
Deficiency Note that were owed by crystal to Lender prior to
execution of this Agreement. Lender agrees to pay the 1995 real
property taxes relating to the Project for the prorata period prior
to the closing with the Purchaser.
(e) First Security shall have received indemnifications and
releases from liability from all parties to the sale of the Project
(including without limitation, the Millards and the Royalty
Owners).
6, Effect of Amendment. Except as modified hereby (including
the Deficiency Note which is incorporated herein), all terms of the
Loan Documents shall remain unchanged and stall remain in full
force and effect, and the Crystal Affiliates hereby reaffirm all of
the terms of the Loan Documents as modified hereby and agree to be
bound by the Loan Documents as modified hereby.
7. Acknowledgements by Crystal Affiliates. The Crystal
Affiliates hereby jointly and severally represent, warrant and
acknowledge that: (a) the Crystal Affiliates have no offsets or
counterclaims against Lender or defenses to payments due under the
Loan Documents, as the same are being amended and supplemented by
this Agreement; (b) the execution and performance of this Agreement
and the other Loan Documents have been duly authorized pursuant to
all necessary partnership and corporate authority; (c) the recitals
to this Agreement are true. Crystal hereby reaffirms its
obligations to pay all amounts due to Lender under the Loan
Documents in accordance with the terms thereof as modified hereby.
In addition, the warranties, representations, covenants and
agreements contained in the Loan Documents, as herein expressly
supplemented and amended, are hereby specifically reaffirmed and
remade by Crystal. Neither this Agreement nor any action taken in
accordance herewith shall constitute a release or waiver of any
obligation or liability of Crystal or any other surety or obligor
under the Loan Documents (as modified hereby).
8. Further Assurances. The Crystal Affiliates shall take all
such further actions and execute such additional documents as
lender may reasonably request, in form reasonably satisfactory to
Lender and the Crystal Affiliates, to vest in, perfect, keep
perfected and assure Lender's rights hereunder and in and under the
Loan Documents.
9. The Crystal Affiliates hereby affirm, acknowledge and
represent that Lender has fully and faithfully performed all of its
obligations under the Loan Documents and other documents relating
to the Loan, and that, absent this Agreement, First Security was
entitled to exercise all of its remedies under the Loan Documents
to collect the remaining amounts owed in connection with the Loan
at its maturity on September 1, 1994. The Crystal Affiliates hereby
affirm that they do not have any defense claim offset, counterclaim
or other claim or action against Lender with respect to the Loan or
the related Loan Documents (as amended hereby), or arising out of
negotiations prior to and contemporaneous with the execution or
this Agreement, and that even if such claim, action, defense,
offset or counterclaim exists or might exist on the date hereof
(whether known or unknown), the Crystal Affiliates hereby knowingly
waive, release and relinquish the same. The Crystal Affiliates
acknowledge that the relationship between Crystal and Lender has
been solely a borrower-lender relationship, that Lender has not
exercised control over the Crystal Affiliates or any of their
operations, and that the Crystal Affiliates are not acting under
any duress or coercion in connection with the execution of this
Agreement. The Crystal Affiliates represent and warrant to Lender
that they have obtained the advice of independent legal counsel
with respect to their execution of this Agreement and the matters
set forth herein.
10. Integration. The Loan Documents, as amended by this
Agreement, express, embody and supersede any previous
understandings, agreements and promises (whether written or oral)
with respect to the Loan, and represent the final expression of the
agreement between Lender and the Crystal Affiliates, the terms and
conditions of which cannot hereafter be contradicted by any oral
understanding (if any) not reduced to writing.
11. General. This Agreement shall be governed by the laws of
the state of state In the event of any default by the parties
hereto or under this Agreement or any of the other Loan Documents
(as modified hereby), the defaulting party shall pay reasonable
attorneys' fees and costs incurred by the nondefaulting party. This
Agreement shall be binding upon and inure to the benefit of the
Crystal Affiliates, Bender and their respective heirs, legal
representatives, successors and permitted assigns. This Agreement
may bc executed in counterparts, each of which shall be deemed to
be an original and all of which, taken together, shall constitute
but one and the same instrument.
Executed as of the date first written above.
FIRST SECURITY BANK OF UTAH, N A.
/s/
CRYSTAL SPRINGS HYDROELECTRIC COMPANY, an Idaho general partnership
By: Far West Capital, Inc,, a Utah corporation, as general partner
Its: /s/
By: Far west Electric Energy Fund, L.P., a Delaware limited
partnership, as general partner
By: Far West Capital, Inc., a Utah corporation, as general
partner .
By: /s/
Alan o. Melchior, as a former general partner
by: /s/
Thomas A. Quinn, as a former general partner<PAGE>
EXHIBIT (10) (aat)
AMENDED AND SUBSTITUTED PROMISSORY NOTE
March 15, 1995
Borrower: Crystal Springs Hydroelectric Company,
an Idaho general partnership
Rate: First Security's Prime Rate
Principal Amount; Five Hundred Thirty-Seven Thousand Dollars
($537,000.00)
Due Date: March 15, 2000
For value received, the undersigned ("Borrower") promises to
pay on or before March 15, 2000, to First security Bank of Utah,
National Association ("First Security"), or to its order, the total
principal sum of Five Hundred Thirty-seven Thousand Dollars
($537,000.00), or such other amount then outstanding under this
Note, plus interest then accrued and unpaid. This Note is payable
in lawful money of the United States of America.
Interest on the unpaid balance outstanding from time to time
will be calculated at a per annum rate equal to First Security's
"Prime Rate." As used herein, "Prime Rate" shall mean First
Security's announced rate of interest (per annum) used as a
reference point from which the cost of credit to customers may be
calculated, and is subject to change from time to time, First
Security may make loans bearing interest above, at or below its
Prime Rate; such rate, though designated as the Prime Rate, not
necessarily being the best or lowest rate available to borrowers
from First security. Notwithstanding the foregoing, upon the
occurrence of an "Event of Default'! (as defined in that certain
Credit Agreement dated as of July 7, 1988, as amended from time to
time, including as amended by the Third Extension and Modification
Agreement dated of even date herewith (as so amended, the
"Agreement")) the rate of interest per annum shall be sixteen
percent (16.0%) per annum from and after such event of Default;
provided further, however, that if First Security shall waive in
writing or allow a cure of such Event of Default, the interest rate
shall revert to the non-default rate specified above from and after
such waiver or completion of cure (whichever is sooner). The Prime
Rate may change from time to time, and the interest payable on this
Note will continue to fluctuate with the Prime Rate as stated
above. Any changes in the interest rate under this Note shall
become effective, without prior notice, on the date on which the
Prime Rate changes. Interest will be charged on a daily basis for
the actual number of days the unpaid principal is outstanding on a
per annum basis from the date of disbursement to the date of
maturity. The actual interest to be charged under this Note shall
be calculated on a 365 day year. Should the rate of interest, as
calculated, exceed that allowed by law, the applicable rate of
interest will be the maximum rate of interest lawfully allowed. The
principal amount outstanding, on which the interest rate shall be
charged, shall be determined from the records of First Security,
During the term hereof, semiannual installments of all accrued
and unpaid interest shall be paid on the first day of each
September and March, commencing September 1, 1995, during the term
hereof. In the event that any of the above provided semiannual
interest installments are not paid when due or within ten (10) days
after such due date, Borrower agrees to pay without further notice
hereof, a late fee equal to five percent (5%) of each unpaid and
delinquent installment- If, however, such installment falls due and
payable on a Saturday, Sunday, legal holiday or other nonbanking
day under the laws of the State of Utah, the due date of such
installment shall be extended to the next succeeding business day
and interest hereon shall be payable at the then applicable rate
during such extension. All remaining principal and accrued and
unpaid interest shall be due and payable in full on March 15, 2000.
All payments received by First Security on this Note shall be
applied as follows: first following any event of Default under the
Agreement, toward the satisfaction of reasonable attorney's fees
and costs incidental thereto and to advances made and reasonable
costs and expenses incurred by the holder of this Note and its
agents to enforce Borrower's obligations hereunder and under the
related loan documents; second, toward the reduction of any and all
accrued and unpaid interest under this Note, including uncollected
late charges; and third, toward the reduction of unpaid principal
under this Note.
This Note is the Promissory Note referred to in the Agreement
(the deficiency NoteS referred to in the Third Extension and
Modification Agreement of even date herewith), and this Note is
entitled to the benefits thereof and is subject to the terms and
conditions thereof. Borrower may prepay the unpaid principal sum
hereof as provided in the Agreement.
In the event of a failure in the payment of an-y v! said
installments or any part thereof resulting in an Event of Default,
it shall be optional with the legal holder of this Note to declare
the entire principal sum hereof (together with all accrued and
unpaid interest and all other amounts due hereunder or under the
Agreement immediately due and payable, and proceedings may at once
be instituted for the enforcement and collection of the same by
law. Likewise, if there shall be any other Event of Default
pursuant to the Agreement, First Security or the holder of this
Note, at its option ~ may declare immediately due and payable the
entire principal sum hereof and all accrued and unpaid interest and
all other amounts due hereunder or under the Agreement. Borrower
understands and agrees that failure of First Security or any holder
of this Note to exercise this option shall not constitute a waiver
of the right to exercise; the Same in the event of a later default.
Borrower agrees to pay all reasonable attorneys' fees and
other expenses incurred by First Security or the holder of this
Note in the enforcement of any of its rights hereunder whether the
default is ultimately cured or whether First Security or the holder
of this Note ia obligated to pursue its legal remedies, including
such expenses incurred prior to the institution of legal action,
during the pendency of such legal action and continuing to include
all such expenses incurred in connection with any appeal to higher
courts arising out of legal proceedings to enforce Borrower's
obligation hereunder or in any way in connection with bankruptcy or
other insolvency proceedings. In the event Borrower prevails in any
such legal action or proceeding, Lender similarly agrees to pay
all such reasonable attorneys' fees and other expenses incurred by
Borrower.
The makers, sureties, guarantors and endorser of this Note
jointly and severally waive presentment for payment, notice of
dishonor, protest, notice of protest and of nonpayment of this
Note, and consent to any extension of time of payment hereof, any
addition, release or substitution of all or any collateral securing
the payment hereof, and any addition, release or substitution of
any party liable for this obligation. Time is of the essence
hereof.
This Note shall be construed according to the lass of the
State of Utah.
This Note is intended to amend by substitution the Promissory
Note dated July 7, 1988, made by Borrower and payable to First
security in the maximum principal amount of $2,800,000.00, as
amended (the "original Note"), and this Note is not in novation or
payment of the Original Note. Although Alan O. Melchior and Thomas
A. Quinn have withdrawn as general partners in Far West Electric
Energy Fund, L.P., they are signing this Note to acknowledge their
continuing general partner liability for the obligations evidenced
by this Note which are a continuation of the obligations evidenced
by the Original Note.
CRYSTAL SPRINGS HYDROELECTRIC COMPANY, an Idaho general partnership
By: Far West Capital, Inc., a Utah corporation, as general partner
By: /s/
Its:
By: Far West Electric Energy Fund, L.P., a Delaware limited
partnership, as general partner
By: Far West Capital, Inc,, a Utah
corporation, as general partner
By: /s/
Its:
By: /s/
Alan 0. Melchior, a former general partner
By: /s/
Thomas A. Quinn, a former general partner
EXHIBIT 23
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
Far West Electric Energy Fund, L.P.,
A Delaware Limited Partnership
We hereby consent to the use of our report respecting Far West
Electric Energy Fund, L.P. dated March 7, 1995 in Item 8 of Form
10-K.
/s/ Robison, Hill & Co.
Certified Public Accountants
Salt Lake City, Utah
March 16, 1995
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE BALANCE
SHEET OF FAR WEST ELECTRIC ENERGY FUND, L.P. AS OF DECEMBER 31, 1994 AND THE
RELATED STATEMENTS OF INCOME, PARTNERS' CAPITAL AND CASH FLOWS FOR THE YEAR THEN
ENDED AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<CIK> 0000753767
<NAME> FAR WEST ELECTRIC ENERGY FUND L P
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1994
<PERIOD-END> DEC-31-1994
<CASH> 278
<SECURITIES> 1145
<RECEIVABLES> 443
<ALLOWANCES> 0
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<CURRENT-ASSETS> 892
<PP&E> 19169
<DEPRECIATION> 6010
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0
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<SALES> 2728
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<CGS> 0
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