SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K/A
Amendment No. 1
Annual Report Pursuant to Section 13 or 15 (d) of
the Securities Exchange Act of 1934
For the fiscal year ended December 31, 1998
Commission File No. 33-95538
SALTON SEA FUNDING CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 47-0790493
(State of (I.R.S. Employer
Incorporation) Identification No.)
Salton Sea Brine Processing L.P. California 33-0601721
Salton Sea Power Generation L.P. California 33-0567411
Fish Lake Power LLC Delaware 33-0453364
Vulcan Power Company Nevada 95-3992087
CalEnergy Operating Corporation Delaware 33-0268085
Salton Sea Royalty LLC Delaware 47-0790492
VPC Geothermal LLC Delaware 91-1244270
San Felipe Energy Company California 33-0315787
Conejo Energy Company California 33-0268500
Niguel Energy Company California 33-0268502
Vulcan/BN Geothermal Power Company Nevada 33-3992087
Leathers, L.P. California 33-0305342
Del Ranch, L.P. California 33-0278290
Elmore, L.P. California 33-0278294
302 S. 36th Street, Suite 400-A, Omaha, NE 68131
(Address of principal executive offices and Zip Code of Salton
Sea Funding Corporation)
Salton Sea Funding Corporation's telephone number, including area code:
(402) 231-1644
Securities registered pursuant to Section 12(b) of the Act: N/A
Securities registered pursuant to Section 12(g) of the Act: N/A
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______
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 ]
All common stock of Salton Sea Funding Corporation is held by
Magma Power Company.
100 shares of Common Stock were outstanding on March 30, 1999.
Documents incorporated by reference: N/A
Signatures
Pursuant to the requirements of Section 13 or 15 (d) of the
Securities Exchange Act of 1934, the Registrant has duly caused
this report to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Omaha, State of
Nebraska, on April 15, 1999.
SALTON SEA FUNDING CORPORATION
By:/s/ David L. Sokol*
David L. Sokol
Director, Chairman of the Board
and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, the
Registrant has duly caused this report to be signed on its behalf
by the undersigned, each thereunto duly authorized in the City of
Omaha, State of Nebraska, on the dates indicated.
Signature Date
/s/ David L. Sokol* April 15,1999
David L. Sokol
Director, Chairman of the Board and Chief Executive Officer
(Principal Executive Officer)
/s/ Gregory E. Abel * April 15,1999
Gregory E. Abel
Director, President and Chief Operating Officer
/s/ Steven A. McArthur April 15,1999
Steven A. McArthur
Director, Senior Vice President and Secretary
/s/ Patrick J. Goodman* April 15, 1999
Patrick J. Goodman
Senior Vice President, Chief Financial Officer
and Chief Accounting Officer
(Principal Accounting Officer)
* By: /s/ Steven A. McArthur
Steven A. McArthur
Attorney-in-fact
Signatures
Pursuant to the requirements of Section 13 or 15 (d) of the
Securities Exchange Act of 1934, the Registrant has duly caused
this report to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Omaha, State of
Nebraska, on April 15, 1999.
SALTON SEA BRINE PROCESSING, L.P.
a California limited partnership
By: Salton Sea Power Company,
a California corporation, its
general partner
By:/s/ David L. Sokol*
David L. Sokol
Director, Chairman of the Board
and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, the
Registrant has duly caused this report to be signed on its behalf
by the undersigned, each thereunto duly authorized in the City of
Omaha, State of Nebraska, on the dates indicated.
Signature Date
/s/ David L. Sokol* April 15,1999
David L. Sokol
Director, Chairman of the Board and Chief Executive Officer
(Principal Executive Officer)
/s/ Gregory E. Abel* April 15,1999
Gregory E. Abel
Director, President and Chief Operating Officer
/s/ Steven A. McArthur April 15,1999
Steven A. McArthur
Director, Senior Vice President and Secretary
/s/ Patrick J. Goodman* April 15,1999
Patrick J. Goodman
Senior Vice President, Chief Financial Officer and Chief
Accounting Officer
(Principal Accounting Officer)
* By: /s/ Steven A. McArthur
Steven A. McArthur
Attorney-in-fact
Signatures
Pursuant to the requirements of Section 13 or 15 (d) of the
Securities Exchange Act of 1934, the Registrant has duly caused
this report to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Omaha, State of
Nebraska, on April 15, 1999.
SALTON SEA POWER GENERATION,
L.P.,
a California limited partnership
By: Salton Sea Power Company, a
California corporation, its
general partner
By:/s/ David L. Sokol*
David L. Sokol
Director, Chairman of the Board
and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, the
Registrant has duly caused this report to be signed on its behalf
by the undersigned, each thereunto duly authorized in the City of
Omaha, State of Nebraska, on the dates indicated.
Signature Date
/s/ David L. Sokol* April 15,1999
David L. Sokol
Director, Chairman of the Board and Chief Executive Officer
(Principal Executive Officer)
/s/ Gregory E. Abel * April 15,1999
Gregory E. Abel
Director, President and Chief Operating Officer
/s/ Steven A. McArthur April 15, 1999
Steven A. McArthur
Director, Senior Vice President and Secretary
/s/ Patrick J. Goodman* April 15,1999
Patrick J. Goodman
Senior Vice President, Chief Financial Officer and Chief
Accounting Officer
(Principal Accounting Officer)
* By: /s/ Steven A. McArthur
Steven A. McArthur
Attorney-in-fact
Signatures
Pursuant to the requirements of Section 13 or 15 (d) of the
Securities Exchange Act of 1934, the Registrant has duly caused
this report to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Omaha, State of
Nebraska, on April 15, 1999.
FISH LAKE POWER COMPANY
By:/s/ David L. Sokol*
David L. Sokol
Director, Chairman of the Board
and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, the
Registrant has duly caused this report to be signed on its behalf
by the undersigned, each thereunto duly authorized in the City of
Omaha, State of Nebraska, on the dates indicated.
Signature Date
/s/ David L. Sokol* April 15,1999
David L. Sokol
Director, Chairman of the Board and Chief Executive Officer
(Principal Executive Officer)
/s/ Gregory E. Abel * April 15,1999
Gregory E. Abel
Director, President and Chief Operating Officer
/s/ Steven A. McArthur April 15, 1999
Steven A. McArthur
Director, Senior Vice President and Secretary
/s/ Patrick J. Goodman* April 15,1999
Patrick J. Goodman
Senior Vice President, Chief Financial Officer
and Chief Accounting Officer
(Principal Accounting Officer)
* By: /s/ Steven A. McArthur
Steven A. McArthur
Attorney-in-fact
Signatures
Pursuant to the requirements of Section 13 or 15 (d) of the
Securities Exchange Act of 1934, the Registrant has duly caused
this report to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Omaha, State of
Nebraska, on April 15, 1999.
VULCAN POWER COMPANY
By:/s/ David L. Sokol*
David L. Sokol
Director, Chairman of the Board
and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, the
Registrant has duly caused this report to be signed on its behalf
by the undersigned, each thereunto duly authorized in the City of
Omaha, State of Nebraska, on the dates indicated.
Signature Date
/s/ David L. Sokol* April 15,1999
David L. Sokol
Director, Chairman of the Board and Chief Executive Officer
(Principal Executive Officer)
/s/ Gregory E. Abel * April 15,1999
Gregory E. Abel
Director, President and Chief Operating Officer
/s/ Steven A. McArthur April 15, 1999
Steven A. McArthur
Director, Senior Vice President and Secretary
/s/ Patrick J. Goodman* April 15,1999
Patrick J. Goodman
Senior Vice President, Chief Financial Officer
and Chief Accounting Officer
(Principal Accounting Officer)
* By: /s/ Steven A. McArthur
Steven A. McArthur
Attorney-in-fact
Signatures
Pursuant to the requirements of Section 13 or 15 (d) of the
Securities Exchange Act of 1934, the Registrant has duly caused
this report to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Omaha, State of
Nebraska, on April 15, 1999.
CALENERGY OPERATING CORPORATION
By:/s/ David L. Sokol*
David L. Sokol
Director, Chairman of the Board
and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, the
Registrant has duly caused this report to be signed on its behalf
by the undersigned, each thereunto duly authorized in the City of
Omaha, State of Nebraska, on the dates indicated.
Signature Date
/s/ David L. Sokol* April 15,1999
David L. Sokol
Director, Chairman of the Board and Chief Executive Officer
(Principal Executive Officer)
/s/ Gregory E. Abel * April 15,1999
Gregory E. Abel
Director, President and Chief Operating Officer
/s/ Steven A. McArthur April 15, 1999
Steven A. McArthur
Director, Senior Vice President and Secretary
/s/ Patrick J. Goodman* April 15,1999
Patrick J. Goodman
Senior Vice President, Chief Financial Officer
and Chief Accounting Officer
(Principal Accounting Officer)
* By: /s/ Steven A. McArthur
Steven A. McArthur
Attorney-in-fact
Signatures
Pursuant to the requirements of Section 13 or 15 (d) of the
Securities Exchange Act of 1934, the Registrant has duly caused
this report to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Omaha, State of
Nebraska, on April 15, 1999.
SALTON SEA ROYALTY COMPANY
By:/s/ David L. Sokol*
David L. Sokol
Director, Chairman of the Board
and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, the
Registrant has duly caused this report to be signed on its behalf
by the undersigned, each thereunto duly authorized in the City of
Omaha, State of Nebraska, on the dates indicated.
Signature Date
/s/ David L. Sokol* April 15,1999
David L. Sokol
Director, Chairman of the Board and Chief Executive Officer
(Principal Executive Officer)
/s/ Gregory E. Abel * April 15,1999
Gregory E. Abel
Director, President and Chief Operating Officer
/s/ Steven A. McArthur April 15, 1999
Steven A. McArthur
Director, Senior Vice President and Secretary
/s/ Patrick J. Goodman* April 15,1999
Patrick J. Goodman
Senior Vice President, Chief Financial Officer
and Chief Accounting Officer
(Principal Accounting Officer)
* By: /s/ Steven A. McArthur
Steven A. McArthur
Attorney-in-fact
Signatures
Pursuant to the requirements of Section 13 or 15 (d) of the
Securities Exchange Act of 1934, the Registrant has duly caused
this report to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Omaha, State of
Nebraska, on April 15, 1999.
LEATHERS, L.P., a
California limited partnership
By: CalEnergy Operating Corporation, a
Delaware corporation, its
general partner
By:/s/ David L.Sokol*
David L. Sokol
Director, Chairman of the Board
and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, the
Registrant has duly caused this report to be signed on its behalf
by the undersigned, each thereunto duly authorized in the City of
Omaha, State of Nebraska, on the dates indicated.
Signature Date
/s/ David L. Sokol* April 15,1999
David L. Sokol
Director, Chairman of the Board and Chief Executive Officer
(Principal Executive Officer)
/s/ Gregory E. Abel * April 15,1999
Gregory E. Abel
Director, President and Chief Operating Officer
/s/ Steven A. McArthur April 15, 1999
Steven A. McArthur
Director, Senior Vice President and Secretary
/s/ Patrick J. Goodman* April 15,1999
Patrick J. Goodman
Senior Vice President, Chief Financial Officer and Chief
Accounting Officer
(Principal Accounting Officer)
* By: /s/ Steven A. McArthur
Steven A. McArthur
Attorney-in-fact
Signatures
Pursuant to the requirements of Section 13 or 15 (d) of the
Securities Exchange Act of 1934, the Registrant has duly caused
this report to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Omaha, State of
Nebraska, on April 15, 1999.
ELMORE L.P., a California limited partnership
By: CalEnergy Operating Corporation, a
Delaware corporation, its
general partner
By:/s/ David L. Sokol*
David L. Sokol
Director, Chairman of the Board
and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, the
Registrant has duly caused this report to be signed on its behalf
by the undersigned, each thereunto duly authorized in the City of
Omaha, State of Nebraska, on the dates indicated.
Signature Date
/s/ David L. Sokol* April 15,1999
David L. Sokol
Director, Chairman of the Board and Chief Executive Officer
(Principal Executive Officer)
/s/ Gregory E. Abel * April 15,1999
Gregory E. Abel
Director, President and Chief Operating Officer
/s/ Steven A. McArthur April 15, 1999
Steven A. McArthur
Director, Senior Vice President and Secretary
/s/ Patrick J. Goodman* April 15,1999
Patrick J. Goodman
Senior Vice President, Chief Financial Officer and Chief
Accounting Officer
(Principal Accounting Officer)
* By: /s/ Steven A. McArthur
Steven A. McArthur
Attorney-in-fact
Signatures
Pursuant to the requirements of Section 13 or 15 (d) of the
Securities Exchange Act of 1934, the Registrant has duly caused
this report to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Omaha, State of
Nebraska, on April 15, 1999.
DEL RANCH L.P., a
California limited partnership
By: CalEnergy Operating Corporation, a
Delaware corporation, its
general partner
By:/s/ David L. Sokol*
David L. Sokol
Director, Chairman of the Board
and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, the
Registrant has duly caused this report to be signed on its behalf
by the undersigned, each thereunto duly authorized in the City of
Omaha, State of Nebraska, on the dates indicated.
Signature Date
/s/ David L. Sokol* April 15,1999
David L. Sokol
Director, Chairman of the Board and Chief Executive Officer
(Principal Executive Officer)
/s/ Gregory E. Abel * April 15,1999
Gregory E. Abel
Director, President and Chief Operating Officer
/s/ Steven A. McArthur April 15, 1999
Steven A. McArthur
Director, Senior Vice President and Secretary
/s/ Patrick J. Goodman* April 15,1999
Patrick J. Goodman
Senior Vice President, Chief Financial Officer and Chief
Accounting Officer
(Principal Accounting Officer)
* By: /s/ Steven A. McArthur
Steven A. McArthur
Attorney-in-fact
Signatures
Pursuant to the requirements of Section 13 or 15 (d) of the
Securities Exchange Act of 1934, the Registrant has duly caused
this report to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Omaha, State of
Nebraska, on April 15, 1999.
BN GEOTHERMAL INC., a
Delaware corporation
By:/s/ David L. Sokol*
David L. Sokol
Director, Chairman of the Board
and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, the
Registrant has duly caused this report to be signed on its behalf
by the undersigned, each thereunto duly authorized in the City of
Omaha, State of Nebraska, on the dates indicated.
Signature Date
/s/ David L. Sokol* April 15,1999
David L. Sokol
Director, Chairman of the Board and Chief Executive Officer
(Principal Executive Officer)
/s/ Gregory E. Abel * April 15,1999
Gregory E. Abel
Director, President and Chief Operating Officer
/s/ Steven A. McArthur April 15, 1999
Steven A. McArthur
Director, Senior Vice President and Secretary
/s/ Patrick J. Goodman* April 15,1999
Patrick J. Goodman
Senior Vice President, Chief Financial Officer
and Chief Accounting Officer
(Principal Accounting Officer)
* By: /s/ Steven A. McArthur
Steven A. McArthur
Attorney-in-fact
Signatures
Pursuant to the requirements of Section 13 or 15 (d) of the
Securities Exchange Act of 1934, the Registrant has duly caused
this report to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Omaha, State of
Nebraska, on April 15, 1999.
NIGUEL ENERGY COMPANY, a
California corporation
By:/s/ David L. Sokol*
David L. Sokol
Director, Chairman of the Board
and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, the
Registrant has duly caused this report to be signed on its behalf
by the undersigned, each thereunto duly authorized in the City of
Omaha, State of Nebraska, on the dates indicated.
Signature Date
/s/ David L. Sokol* April 15, 1999
David L. Sokol
Director, Chairman of the Board and Chief Executive Officer
(Principal Executive Officer)
/s/ Gregory E. Abel * April 15, 1999
Gregory E. Abel
Director, President and Chief Operating Officer
/s/ Steven A. McArthur April 15, 1999
Steven A. McArthur
Director, Senior Vice President and Secretary
/s/ Patrick J. Goodman* April 15, 1999
Patrick J. Goodman
Senior Vice President, Chief Financial Officer
and Chief Accounting Officer
(Principal Accounting Officer)
* By: /s/ Steven A. McArthur
Steven A. McArthur
Attorney-in-fact
Signatures
Pursuant to the requirements of Section 13 or 15 (d) of the
Securities Exchange Act of 1934, the Registrant has duly caused
this report to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Omaha, State of
Nebraska, on April 15, 1999.
CONEJO ENERGY COMPANY, a
California corporation
By:/s/ David L. Sokol*
David L. Sokol
Director, Chairman of the Board
and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, the
Registrant has duly caused this report to be signed on its behalf
by the undersigned, each thereunto duly authorized in the City of
Omaha, State of Nebraska, on the dates indicated.
Signature Date
/s/ David L. Sokol* April 15,1999
David L. Sokol
Director, Chairman of the Board and Chief Executive Officer
(Principal Executive Officer)
/s/ Gregory E. Abel * April 15,1999
Gregory E. Abel
Director, President and Chief Operating Officer
/s/ Steven A. McArthur April 15, 1999
Steven A. McArthur
Director, Senior Vice President and Secretary
/s/ Patrick J. Goodman* April 15,1999
Patrick J. Goodman
Senior Vice President, Chief Financial Officer
and Chief Accounting Officer
(Principal Accounting Officer)
* By: /s/ Steven A. McArthur
Steven A. McArthur
Attorney-in-fact
Signatures
Pursuant to the requirements of Section 13 or 15 (d) of the
Securities Exchange Act of 1934, the Registrant has duly caused
this report to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Omaha, State of
Nebraska, on April 15, 1999.
SAN FELIPE ENERGY COMPANY, a
California corporation
By:/s/ David L. Sokol*
David L. Sokol
Director, Chairman of the Board
and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, the
Registrant has duly caused this report to be signed on its behalf
by the undersigned, each thereunto duly authorized in the City of
Omaha, State of Nebraska, on the dates indicated.
Signature Date
/s/ David L. Sokol* April 15,1999
David L. Sokol
Director, Chairman of the Board and Chief Executive Officer
(Principal Executive Officer)
/s/ Gregory E. Abel * April 15,1999
Gregory E. Abel
Director, President and Chief Operating Officer
/s/ Steven A. McArthur April 15, 1999
Steven A. McArthur
Director, Senior Vice President and Secretary
/s/ Patrick J. Goodman* April 15,1999
Patrick J. Goodman
Senior Vice President, Chief Financial Officer
and Chief Accounting Officer
(Principal Accounting Officer)
* By: /s/ Steven A. McArthur
Steven A. McArthur
Attorney-in-fact
Signatures
Pursuant to the requirements of Section 13 or 15 (d) of the
Securities Exchange Act of 1934, the Registrant has duly caused
this report to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Omaha, State of
Nebraska, on April 15, 1999.
VULCAN/BN GEOTHERMAL POWER COMPANY,
a Nevada general partnership
By: VULCAN POWER COMPANY,
a Nevada corporation, Partner
By:/s/ David L. Sokol*
David L. Sokol
Director, Chairman of the Board
and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, the
Registrant has duly caused this report to be signed on its behalf
by the undersigned, each thereunto duly authorized in the City of
Omaha, State of Nebraska, on the dates indicated.
Signature Date
/s/ David L. Sokol* April 15,1999
David L. Sokol
Director, Chairman of the Board and Chief Executive Officer
(Principal Executive Officer)
/s/ Gregory E. Abel * April 15,1999
Gregory E. Abel
Director, President and Chief Operating Officer
/s/ Steven A. McArthur April 15, 1999
Steven A. McArthur
Director, Senior Vice President and Secretary
/s/ Patrick J. Goodman* April 15,1999
Patrick J. Goodman
Senior Vice President, Chief Financial Officer
and Chief Accounting Officer
(Principal Accounting Officer)
* By: /s/ Steven A. McArthur
Steven A. McArthur
Attorney-in-fact
The undersigned registrant hereby amends and supplements Item 14
of its Annual Report on Form 10-K for the fiscal year ended
December 31, 1998, by filing herewith an amended and restated
Exhibit Index which shall read as follows and by filing herewith
the following Exhibits noted by an asterisk (*):
INDEX TO EXHIBITS
Exhibit No. Description of Exhibit
3.1 Articles of Incorporation of the Funding Corporation
(incorporated by reference to Exhibit 3.1 to the Funding
Corporation Registration Statement on Form S-4 dated August
9, 1995, 33-95538 ("Form S-4")).
3.2 By-laws of the Funding Corporation (incorporated by
reference to Exhibit 3.2 to the Funding Corporation Form S-
4).
3.3 Limited Partnership Agreement of SSBP (incorporated by
reference to Exhibit 3.3 to the Funding Corporation Form S-
4).
3.4 Limited Partnership Agreement of SSPG (incorporated by
reference to Exhibit 3.4 to the Funding Corporation Form S-
4).
3.5 Articles of Incorporation of Fish Lake (incorporated by
reference to Exhibit 3.5 to the Funding Corporation Form S-
4).
3.6 By-laws of Fish Lake (incorporated by reference to Exhibit
3.6 to the Funding Corporation Form S-4).
3.7 Articles of Incorporation of VPC (incorporated by reference
to Exhibit 3.7 to the Funding Corporation Form S-4).
3.8 By-laws of VPC (incorporated by reference to Exhibit 3.8 to
the Funding Corporation Form S-4).
3.9 Articles of Incorporation of CEOC (incorporated by reference
to Exhibit 3.9 to the Funding Corporation Form S-4).
3.10By-laws of CEOC (incorporated by reference to Exhibit 3.10
to the Funding Corporation Form S-4).
3.11Articles of Incorporation of the Royalty Guarantor
(incorporated by reference to Exhibit 3.11 to the Funding
Corporation Form S-4).
3.12By-laws of the Royalty Guarantor (incorporated by reference
to Exhibit 3.12 to the Funding Corporation Form S-4).
3.13 Certificate of Amendment of Certificate of
Incorporation dated as of March 26, 1996
3.14 Articles of Incorporation of BNG (incorporated by reference
to Exhibit 3.13 to the Funding Corporation Registration
Statement on Form S-4 dated July 2, 1996, 333-07527
("Funding Corporation II Form S-4")).
3.15 By-laws of BNG (incorporated by reference to Exhibit 3.14 to
the Funding Corporation II Form S-4).
3.16 Articles of Incorporation of San Felipe (incorporated
by reference to Exhibit 3.15 to the Funding Corporation II Form S-
4).
3.17 By-laws of San Felipe (incorporated by reference to
Exhibit 3.16 to the Funding Corporation II Form S-4).
3.18 Articles of Incorporation of Conejo (incorporated by
reference to Exhibit 3.17 to the Funding Corporation II Form
S-4).
3.19 By-laws of Conejo (incorporated by reference to Exhibit
3.18 to the Funding Corporation II Form
S-4).
3.20 Articles of Incorporation of Niguel (incorporated by
reference to Exhibit 3.19 to the Funding Corporation II Form
S-4).
3.21 By-laws of Niguel (incorporated by reference to Exhibit 3.20
to the Funding Corporation II Form S-4).
3.22 General Partnership Agreement of Vulcan (incorporated by
reference to Exhibit 3.21 to the Funding Corporation II Form
S-4).
3.23 Limited Partnership Agreement of Leathers (incorporated by
reference to Exhibit 3.22 to the Funding Corporation II Form
S-4).
3.24 Amended and Restated Limited Partnership Agreement of
Del Ranch (incorporated by reference to Exhibit 3.23 to the
Funding Corporation II Form S-4).
3.25 Amended and Restated Limited Partnership Agreement of Elmore
(incorporated by reference to Exhibit 3.24 to the Funding
Corporation II Form S-4).
4.1(a) Indenture, dated as of July 21, 1995, between Chemical
Trust Company of California and the Funding Corporation
(incorporated by reference to Exhibit 4.1(a) to the Funding
Corporation Form S-4).
4.1(b) First Supplemental Indenture, dated as of October 18,
1995, between Chemical Trust Company of California and the
Funding Corporation (incorporated by reference to Exhibit
4.1(b) to the Funding Corporation Form S-4).
4.1(c) Second Supplemental Indenture, dated as of June 20,
1996, between Chemical Trust Company of California and the
Funding Corporation (incorporated by reference to Exhibit
4.1(c) to the Funding Corporation II Form S-4).
4.1(d) Third Supplemental Indenture between Chemical Trust
Company of California and the Funding Corporation
(incorporated by reference to Exhibit 4.1(d) to the Funding
Corporation II Form S-4).
4.1(e) Fourth Supplemental Indenture between Chemical Trust
Company of California and the Funding Corporation. *
4.2 Salton Sea Secured Guarantee, dated as of July 21, 1995, by
SSBP, SSPG and Fish Lake in favor of Chemical Trust Company
of California (incorporated by reference to Exhibit 4.2 to
the Funding Corporation Form S-4).
4.3(a) Partnership Guarantors Secured Limited Guarantee, dated
as of July 21, 1995, by CEOC and VPC in favor of Chemical
Trust Company of California (incorporated by reference to
Exhibit 4.3 to the Funding Corporation Form S-4).
4.3(b) Amended and Restated Partnership Guarantors Secured
Limited Guarantee, dated as of June 20, 1996 by CEOC, and
VPC, Conejo, Niguel, Sal Felipe, BNG, Del Ranch, Elmore,
Leathers and Vulcan in favor of Chemical Trust Company of
California (incorporated by reference to Exhibit 4.3 to the
Funding Corporation II Form S-4).
4.3(c) Second Amended and Restated Partnership Secured Limited
Guarantee, dated as of October 13, 1998 by by CEOC, and VPC,
Conejo, Niguel, Sal Felipe, BNG, Del Ranch, Elmore, Leathers
and Vulcan in favor of Chemical Trust Company of California.
*
4.4 Royalty Guarantor Secured Limited Guarantee, dated as of
July 21, 1995, by the Royalty Guarantor in favor of Chemical
Trust Company of California (incorporated by reference to
Exhibit 4.4 to the Funding Corporation Form S-4).
4.5(a) Exchange and Registration Rights Agreement, dated July
21, 1995, by and among CS First Boston Corporation, Lehman
Brothers Inc. and the Funding Corporation (incorporated by
reference to Exhibit 4.5 to the Funding Corporation Form S-
4).
4.5(b) Exchange and Registration Rights Agreement, dated June
20, 1996, by and between CS First Boston Corporation and the
Funding Corporation (incorporated by reference to Exhibit
4.5 to the Funding Corporation II Form S-4).
4.6(a) Collateral Agency and Intercreditor Agreement, dated as
of July 21, 1995, by and among Credit Suisse, Chemical Trust
Company of California, the Funding Corporation and the
Guarantors (incorporated by reference to Exhibit 4.6 to the
Funding Corporation Form S-4).
4.6(b) First Amendment to the Collateral Agency and
Intercreditor Agreement, dated as of June 20, 1996, by and
among Credit Suisse, Chemical Trust Company of California,
the Funding Corporation and the Guarantors (incorporated by
reference to Exhibit 4.6(b) to the Funding Corporation II
Form S-4).
4.6(c) Second Amendment to the Collateral Agency and
Intercreditor Agreement, dated as of October 13, 1998, by
and among Credit Suisse, Chemical Trust Company of
California, the Funding Corporation and the Guarantors. *
4.7 Stock Pledge Agreement, dated as of July 21, 1995, by Magma
Power Company in favor of Chemical Trust Company of
California (incorporated by reference to Exhibit 4.7 to the
Funding Corporation Form S-4).
4.8(a) Purchase Agreement, dated July 18, 1995, by and among
CS First Boston Corporation, Lehman Brothers Inc., the
Guarantors and the Funding Corporation (incorporated by
reference to Exhibit 4.8 to the Funding Corporation Form S-
4).
4.8(b) Purchase Agreement, dated June 17, 1996, by and among
CS First Boston Corporation, the Guarantors and the Funding
Corporation (incorporated by reference to Exhibit 4.8 to
the Funding Corporation II Form S-4).
4.8(c) Purchase Agreement, dated October 13, 1998 by and among
CS First Boston Corporation, the Guarantors and the Funding
Corporation. *
4.9 Support Letter, dated as of July 21, 1995, by and among
Magma Power Company, the Funding Corporation and the
Guarantors (incorporated by reference to Exhibit 4.9 to the
Funding Corporation Form S-4).
4.37 Debt Service Reserve Letter of Credit and Reimbursement
Agreement, dated as of July 21, 1995, by and among the Funding
Corporation, certain banks and Credit Suisse, as agent
(incorporated by reference to Exhibit 4.10 to the Funding
Corporation Form S-4).
4.10(a) Amendment to Notes and to Amended Debt Service Reserve
Letter of Credit and Reimbursement Agreement, dated October
13, 1998, by and among the Funding Corporation, certain
banks and Credit Suisse, as agent. *
4.11 Revolving Credit Agreement, dated as of July 21, 1995,
by and among Credit Suisse and the Funding Corporation
(incorporated by reference to Exhibit 4.11 to the Funding
Corporation Form S-4).
4.12Salton Sea Credit Agreement, dated July 21, 1995, by and
among SSBP, SSPG and Fish Lake (incorporated by reference to
Exhibit 4.12 to the Funding Corporation Form S-4).
4.13Salton Sea Project Note, dated July 21, 1995, by SSBP, SSPG
and Fish Lake in favor of the Funding Corporation
(incorporated by reference to Exhibit 4.13 to the Funding
Corporation Form S-4).
4.13(a) Salton Sea Project Note (SSI), dated October 13, 1998,
by SSBP, SSPG and Fish Lake in favor of the Funding
Corporation. *
4.13(b) Salton Sea Project Note (SSIII), dated October 13,
1998, by SSBP, SSPG and Fish Lake in favor of the Funding. *
4.14(a) Deposit and Disbursement Agreement, dated as of July
21, 1995, by and among the Funding Corporation, Chemical
Trust Company of California and the Guarantors (incorporated
by reference to Exhibit 4.14 to the Funding Corporation Form
S-4).
4.14(b) Amendment No. 1 to Deposit and Disbursement Agreement,
dated as of June 20, 1996, by and among the Funding
Corporation, Chemical Trust Company of California and the
Guarantors (incorporated by reference to Exhibit 4.14(b) to
the Funding Corporation II Form S-4).
4.14(c) Amended and Restated Deposit and Disbursement
Agreement, dated as of October 13, 1998, by and among the
Funding Corporation, Chemical Trust Company of California
and the Guarantors. *
4.15Partnership Interest Pledge Agreement, dated as of July 21,
1995, by Magma Power Company and Salton Sea Power Company in
favor of Chemical Trust Company of California (incorporated
by reference to Exhibit 4.15 to the Funding Corporation Form
S-4).
4.16Partnership Interest Pledge Agreement, dated as of July 21,
1995, by SSBP and Salton Sea Power Company in favor of
Chemical Trust Company of California (incorporated by
reference to Exhibit 4.16 to the Funding Corporation Form S-
4).
4.17Stock Pledge Agreement (Pledge of Stock of Fish Lake by
Magma Power Company and the Funding Corporation), dated as
of July 21, 1995, by Magma Power Company and the Funding
Corporation in favor of Chemical Trust Company of California
(incorporated by reference to Exhibit 4.17 to the Funding
Corporation Form S-4).
4.18Cost Overrun Commitment, dated as of July 21, 1995, between
MidAmerican, SSPG, SSBP and Fish Lake (incorporated by
reference to Exhibit 4.18 to the Funding Corporation Form S-
4).
4.19(a) Partnership Guarantors Credit Agreement, dated July 21,
1995, by and among CEOC, VPC and the Funding Corporation
(incorporated by reference to Exhibit 4.19 to the Funding
Corporation Form
S-4).
4.19(b) Amended and Restated Partnership Guarantors Credit
Agreement, dated June 20, 1996, by and among the Partnership
Guarantors and the Funding Corporation (incorporated by
reference to Exhibit 4.19 to the Funding Corporation II Form
S-4).
4.19(c) Second Amended and Restated Partnership Guarantors
Credit Agreement, dated October 13, 1998, by and among the
Partnership Guarantors and the Funding Corporation. *
4.20Partnership Guarantors Security Agreement and Assignment of
Rights, dated as of July 21, 1995, by CEOC and VPC in favor
of Chemical Trust Company of California (incorporated by
reference to Exhibit 4.20 to the Funding Corporation Form S-
4).
4.21Stock Pledge Agreement (Pledge of Stock of CEOC by Magma
Power Company and the Funding Corporation), dated as of July
21, 1995, by Magma Power Company and Funding Corporation in
favor of Chemical Trust Company of California (incorporated
by reference to Exhibit 4.21 to the Funding Corporation Form
S-4).
4.22Stock Pledge Agreement (Pledge of Stock of VPC by Magma
Power Company and the Funding Corporation), dated as of July
21, 1995, by Magma Power Company and the Funding Corporation
in favor of Chemical Trust Company of California
(incorporated by reference to Exhibit 4.22 to the Funding
Corporation Form S-4).
4.23Royalty Guarantor Credit Agreement, among the Royalty
Guarantor and the Funding Corporation, dated as of July 21,
1995 (incorporated by reference to Exhibit 4.23 to the
Funding Corporation Form S-4).
4.24Royalty Project Note, dated as of July 21, 1995, by the
Royalty Guarantor in favor of the Funding Corporation
(incorporated by reference to Exhibit 4.24 to the Funding
Corporation Form S-4).
4.25Royalty Security Agreement and Assignment of Revenues, dated
as of July 21, 1995, by the Royalty Guarantor in favor of
Chemical Trust Company of California (incorporated by
reference to Exhibit 4.25 to the Funding Corporation Form S-
4).
4.26Royalty Deed of Trust, dated as of July 21, 1995, by the
Royalty Guarantor to Chicago Title Company for the use and
benefit of Chemical Trust Company of California
(incorporated by reference to Exhibit 4.26 to the Funding
Corporation Form S-4).
4.27Stock Pledge Agreement (Pledge of Stock of Royalty Guarantor
by Magma Power Company and the Funding Corporation), dated
as of July 21, 1995, by Magma Power Company and the Funding
Corporation in favor of Chemical Trust Company of California
(incorporated by reference to Exhibit 4.27 to the Funding
Corporation Form S-4).
4.28Collateral Assignment of the Imperial Irrigation District
Agreements, dated as of July 21, 1995, by SSBP, SSPG and
Fish Lake in favor of Chemical Trust Company of California
(incorporated by reference to Exhibit 4.28 to the Funding
Corporation Form S-4).
4.29Collateral Assignments of Certain Salton Sea Agreements,
dated as of July 21, 1995, by SSBP, SSPG and Fish Lake in
favor of Chemical Trust Company of California (incorporated
by reference to Exhibit 4.29 to the Funding Corporation Form
S-4).
4.30Debt Service Reserve Letter of Credit by Credit Suisse in
favor of Chemical Trust Company of California (incorporated
by reference to Exhibit 4.30 to the Funding Corporation Form
S-4).
4.31Partnership Project Note, dated July 21, 1995, by VPC and
CEOC in favor of the Funding Corporation.
4.31(a) Partnership Project Note (SSI), dated October 13, 1998,
by VPC and CEOC in favor of the Funding Corporation. *
4.31(b) Partnership Project Note (SSII), dated October 13,
1998, by VPC and CEOC in favor of the Funding Corporation. *
4.31(c) Partnership Project Note (SSIII), dated October 13,
1998, by VPC and CEOC in favor of the Funding Corporation. *
4.32 Collateral Assignment of the Imperial Irrigation District
Agreements, dated as of June 20, 1996, by Vulcan, Elmore,
Leathers, VPC and Del Ranch in favor of Chemical Trust
Company of California (incorporated by reference to Exhibit
4.29 to the Funding Corporation II Form S-4).
4.33 Collateral Assignments of Certain Partnership Agreements,
dated as of June 20, 1996, by Vulcan Elmore, Leathers and
Del Ranch in favor of Chemical Trust Company of California
(incorporated by reference to Exhibit 4.31 to the Funding
Corporation II Form S-4).
4.34 Debt Service Reserve Letter of Credit by Credit Suisse in
favor of Chemical Trust Company of California (incorporated
by reference to Exhibit 4.32 to the Funding Corporation II
Form S-4).
4.35 Partnership Project Note, dated June 20, 1996, by the
Partnership Guarantors in favor of the Funding Corporation
in the principal amount of $54,956,000 (incorporated by
reference to Exhibit 4.33 to the Funding Corporation II Form
S-4).
4.36 Partnership Project Note, dated June 20, 1996, by the
Partnership Guarantors in favor of the Funding Corporation
in the principal amount of $135,000,000 (incorporated by
reference to Exhibit 4.34 to the Funding Corporation II Form
S-4).
4.37 Deed of Trust, dated as of June 20, 1996, by Vulcan to
Chicago Title Company for the use and benefit of Chemical Trust
Company of California (incorporated by reference to Exhibit 4.35
to the Funding Corporation II Form S-4).
4.37(a) First Amendment to Deed of Trust, dated October 13,
1998 by Vulcan to Chicago Title Company for the use and
benefit of Chemical Trust Company of California. *
4.38 Deed of Trust, dated as of June 20, 1996, by Elmore to
Chicago Title Company for the use and benefit of Chemical
Trust Company of California (incorporated by reference to
Exhibit 4.36 to the Funding Corporation II Form S-4).
4.38(a) First Amendment to Deed of Trust, dated October 13,
1998, by Elmore to Chicago Title Company for the use and
benefit of Chemical Trust Company of California. *
4.39 Deed of Trust, dated as of June 20, 1996, by Leathers to
Chicago Title Company for the use and benefit of Chemical
Trust Company of California (incorporated by reference to
Exhibit 4.37 to the Funding Corporation II Form S-4).
4.39(a) First Amendment to Deed of Trust, dated October 13,
1998, by Leathers to Chicago Title Company for the use and
benefit of Chemical Trust Company of California. *
4.40 Deed of Trust, dated as of June 20, 1996, by Del Ranch to
Chicago Title Company for the use and benefit of Chemical
Trust Company of California (incorporated by reference to
Exhibit 4.38 to the Funding Corporation II Form S-4).
4.40(a) First Amendment to Deed of Trust, dated October 13,
1998, by Del Ranch to Chicago Title Company for the use and
benefit of Chemical Trust Company of California. *
4.41 Stock Pledge Agreement, Dated as of June 20, 1996, by CEOC,
pledging the stock of Conejo, Niguel and San Felipe in favor
of Chemical Trust Company of California for the benefit of
the Secured Parties and the Funding Corporation
(incorporated by reference to Exhibit 4.39 to the Funding
Corporation II Form S-4).
4.42 Stock Pledge Agreement, dated as of June 20, 1996, by VPC,
pledging the stock of BNG in favor of Chemical Trust Company
of California for the benefit of the Secured Parties and the
Funding Corporation (incorporated by reference to Exhibit
4.40 to the Funding Corporation II Form S-4).
4.43 Partnership Interest Pledge Agreement, dated as of June 20,
1996, by VPC and BNG, pledging the partnership interests in
Vulcan in favor of Chemical Trust Company of California for
the benefit of the Secured Parties and the Funding
Corporation (incorporated by reference to Exhibit 4.41 to
the Funding Corporation II Form S-4).
4.44 Partnership Interest Pledge Agreement, dated as of June
20, 1996, by Magma, CEOC and each of Conejo, Niguel, San Felipe,
respectively, pledging the partnership interests in Del Ranch,
Elmore and Leathers, respectively, in favor of Chemical Trust
Company of California for the benefit of the Secured Parties and
the Funding Corporation (incorporated by reference to Exhibit
4.42 to the Funding Corporation II Form S-4).
4.45 Agreement regarding Security Documents, dated as of June 20,
1996, by and among the Initial Guarantors, Magma, SSPC, the
Funding Corporation and Chemical Trust Company of California
(incorporated by reference to Exhibit 4.43 to the Funding
Corporation II Form S-4).
10.1(a) Salton Sea Deed of Trust, Assignment of Rents, Security
Agreement and Fixture Filing, dated as of July 21, 1995, by
SSBP, SSPG and Fish Lake to Chicago Title Company for the
use and benefit of Chemical Trust Company of California
(incorporated by reference to Exhibit 10.1 to the Funding
Corporation Form S-4) .
10.1(b) First Amendment to Salton Sea Deed of Trust, Assignment
of Rents, Security Agreement and Fixed Filing, dated as of
June 20, 1996, by SSBP, SSPG and Fish Lake to Chicago Title
Company for the use and benefit of Chemical Trust
Company of California (incorporated by reference to Exhibit
10.2 to the Funding Corporation II Form S-4).
10.1(c) Second Amendment to Salton Sea Deed of Trust,
Assignment of Rents, Security Agreement and Fixed Filing,
dated as of October 13, 1998, by SSBP, SSPG and Fish Lake to
Chicago Title Company for the use and benefit of Chemical
Trust Company of California. *
10.2Collateral Assignment of Southern California Edison Company
Agreements, dated as of July 21, 1995, by SSPG and Fish Lake
in favor of Chemical Trust Company of California
(incorporated by reference to Exhibit 10.2 to the Funding
Corporation Form S-4).
10.3Contract for the Purchase and Sale of Electric Power from
the Salton Sea Geothermal Facility, dated May 9, 1987 (the
"Unit 1 Power Purchase Agreement"), between Southern
California Edison Company and Earth Energy, Inc.
(incorporated by reference to Exhibit 10.3 to the Funding
Corporation Form S-4).
10.4Amendment No. 1 to the Unit 1 Power Purchase Agreement,
dated as of March 30, 1993, between Southern California
Edison Company and Earth Energy, Inc. (incorporated by
reference to Exhibit 10.4 to the Funding Corporation Form S-
4).
10.5Amendment No. 2 to Unit 1 Power Purchase Agreement, dated
November 29, 1994, between Southern California Edison
Company and SSPG (incorporated by reference to Exhibit 10.5
to the Funding Corporation Form S-4).
10.6Contract for the Purchase and Sale of Electric Power, dated
April 16, 1985 (the "Unit 2 Power Purchase Agreement"),
between Southern California Edison Company and Westmoreland
Geothermal Associates (incorporated by reference to Exhibit
10.6 to the Funding Corporation Form S-4).
10.7Amendment No. 1 to Unit 2 Power Purchase Agreement, dated as
of December 18, 1987, between Southern California Edison
Company and Earth Energy, Inc. (incorporated by reference to
Exhibit 10.7 to the Funding Corporation Form S-4).
10.8Power Purchase Contract, dated April 16, 1985 (the "Unit 3
Power Purchase Agreement"), between Southern California
Edison Company and Union Oil Company of California
(incorporated by reference to Exhibit 10.8 to the Funding
Corporation Form S-4).
10.9Power Purchase Contract (the "Unit 4 Power Purchase
Agreement"), dated November 29, 1994, between Southern
California Edison Company, SSPG and Fish Lake (incorporated
by reference to Exhibit 10.9 to the Funding Corporation Form
S-4).
10.10 Plant Connection Agreement (Unit 2), dated October 3,
1989, between the Imperial Irrigation District and Earth
Energy, Inc. (incorporated by reference to Exhibit 10.10 to
the Funding Corporation Form S-4).
10.11 Plant Connection Agreement, dated August 2, 1988 (Unit
3), between the Imperial Irrigation District and Desert
Power Company (incorporated by reference to Exhibit 10.11 to
the Funding Corporation Form S-4).
10.12 Imperial Irrigation District Funding and Construction
Agreements as amended (Units 2 and 3), dated as of June 29,
1987, among the Imperial Irrigation District, Earth Energy,
Inc., Chevron Geothermal Company of California, Geo East
Mesa No. 3, Inc., Magma Power Company, Desert Power Company,
Geo East Mesa No. 2, Inc., Heber Geothermal Company, Ormesa
Geothermal, Ormesa Geothermal II, Vulcan/BN Geothermal Power
Company, Union Oil Company of California, Del Ranch L.P.,
Elmore L.P., Leathers L.P., Geo East Mesa Limited
Partnership and Imperial Resource Recovery Associates, L.P.
(incorporated by reference to Exhibit 10.12 to the Funding
Corporation Form S-4).
10.13 Transmission Service Agreement, dated as of October 3,
1989 (Unit 2), between the Imperial Irrigation District and
Earth Energy, Inc. (incorporated by reference to Exhibit
10.13 to the Funding Corporation Form S-4).
10.14 Transmission Service Agreement, dated as of August 2,
1988 (Unit 3), between the Imperial Irrigation District and
Desert Power Company (incorporated by reference to Exhibit
10.14 to the Funding Corporation Form S-4).
10.15 Plant Connection Agreement (Unit 4), dated as of July
14, 1995, by and between the Imperial Irrigation District,
SSPG and Fish Lake (incorporated by reference to Exhibit
10.15 to the Funding Corporation Form S-4).
10.16 Letter Agreement, dated February 2, 1995, between Magma
Power Company and the Imperial Irrigation District
(incorporated by reference to Exhibit 10.16 to the Funding
Corporation Form S-4).
10.17 Transmission Service Agreement (Unit 4), dated as of
July 14, 1995, by and between the Imperial Irrigation
District, SSPG and Fish Lake (incorporated by reference to
Exhibit 10.17 to the Funding Corporation Form S-4).
10.18 Transmission Line Construction Agreement (Unit 4),
dated July 14, 1995, between the Imperial Irrigation
District, SSPG and Fish Lake (incorporated by reference to
Exhibit 10.18 to the Funding Corporation Form S-4).
10.19 Funding Agreement, dated June 15, 1988 (Unit 2),
between Southern California Edison Company and Earth Energy,
Inc. (incorporated by reference to Exhibit 10.19 to the
Funding Corporation Form S-4).
10.20 Second Amended and Restated Administrative Services
Agreement, by and among CEOC, SSBP, SSPG and Fish Lake,
dated as of July 15, 1995 (incorporated by reference to
Exhibit 10.20 to the Funding Corporation Form S-4).
10.21 Second Amended and Restated Operating and Maintenance
Agreement, dated as of July 15, 1995, by and among Magma
Power Company, SSBP, SSPG and Fish Lake (incorporated by
reference to Exhibit 10.21 to the Funding Corporation Form S-
4).
10.22 Intentionally Omitted.
10.23 Collateral Assignment of Southern California Edison
Company Agreements, dated as of June 20, 1996, by Vulcan,
Elmore, Leathers and Del Ranch in favor of Chemical Trust
Company of California (incorporated by reference to Exhibit
10.23 to the Funding Corporation II Form S-4).
10.24 Administrative Services Agreement, dated as of June 17,
1996, between CEOC and Vulcan (incorporated by reference to
Exhibit 10.24 to the Funding Corporation II Form S-4).
10.25 Amended and Restated Construction, Operating and
Accounting Agreement, dated as of June 17, 1996, between VPC
and Vulcan (incorporated by reference to Exhibit 10.25 to
the Funding Corporation II Form S-4).
10.26 Long Term Power Purchase Contract, dated March 1,
1984, as amended, between SCE and Vulcan, as successor to Magma
Electric Company (incorporated by reference to Exhibit 10.26 to
the Funding Corporation II Form S-4).
10.27 Transmission Service Agreement, dated December 1, 1988,
between VPC and IID (incorporated by reference to Exhibit
10.27 to the Funding Corporation II Form S-4).
10.28 Plant Connection Agreement, dated as of December 1,
1988, between VPC and IID (incorporated by reference to
Exhibit 10.28 to the Funding Corporation II Form S-4).
10.29 Amended and Restated Administrative Services
Agreement, dated as of June 17, 1996 between CEOC and Elmore
(incorporated by reference to Exhibit 10.29 to the Funding
Corporation II Form S-4).
10.30 Amended and Restated Operating and Maintenance
Agreement, dated as of June 17, 1996, between CEOC and
Elmore (incorporated by reference to Exhibit 10.30 to the
Funding Corporation II Form S-4).
10.31 Long Term Power Purchase Contract, dated June 15, 1984,
as amended, between SCE and Elmore, as successor to Magma
Electric Company (incorporated by reference to Exhibit 10.31
to the Funding Corporation II Form S-4).
10.32 Transmission Service Agreement, dated as of August 2,
1988, as amended, between Elmore and IID (incorporated by
reference to Exhibit 10.32 to the Funding Corporation II
Form S-4).
10.33 Plant Connection Agreement, dated as of August 2, 1988,
between Elmore and IID (incorporated by reference to Exhibit
10.33 to the Funding Corporation II Form S-4).
10.34 Amended and Restated Administrative Services Agreement,
dated as of June 17, 1996, between CEOC and Leathers
(incorporated by reference to Exhibit 10.34 to the Funding
Corporation II Form S-4).
10.35 Amended and Restated Operating and Maintenance
Agreement, dated as of June 17, 1996, between CEOC and
Leathers (incorporated by reference to Exhibit 10.35 to the
Funding Corporation II Form S-4).
10.36 Long Term Power Purchase Contract, dated August 16,
1985, as amended, between SCE and Leathers, as successor to
Imperial Energy Corporation (incorporated by reference to
Exhibit 10.36 to the Funding Corporation II Form S-4).
10.37 Transmission Service Agreement, dated as of
October 3, 1989, as amended, between Leathers and IID
(incorporated by reference to Exhibit 10.37 to the Funding
Corporation II Form S-4).
10.38 Plant Connection Agreement, dated as of October 3,
1989, between Leathers and IID (incorporated by reference to
Exhibit 10.38 to the Funding Corporation II Form S-4).
10.39 Amended and Restated Administrative Services Agreement,
dated as of June 17, 1996, between CEOC and Del Ranch
(incorporated by reference to Exhibit 10.39 to the Funding
Corporation II Form S-4).
10.40 Amended and Restated Operating and Maintenance
Agreement, dated as of June 17, 1996, between CEOC and Del
Ranch (incorporated by reference to Exhibit 10.40 to the
Funding Corporation II Form S-4).
10.41 Long Term Power Purchase Contract, dated February 22,
1984, as amended, between SCE and Del Ranch, as successor to
Magma (incorporated by reference to Exhibit 10.41 to the
Funding Corporation II Form S-4).
10.42 Transmission Service Agreement, dated as of August 2,
1988, as amended, between Del Ranch and IID (incorporated by
reference to Exhibit 10.42 to the Funding Corporation II
Form S-4).
10.43 Plant Connection Agreement, dated as of August 2, 1988,
between Del Ranch and IID (incorporated by reference to
Exhibit 10.43 to the Funding Corporation II Form S-4).
10.44 Funding Agreement, dated May 18, 1990, between SCE and
Del Ranch (incorporated by reference to Exhibit 10.44 to the
Funding Corporation II Form S-4).
10.45 Funding Agreement, dated May 18, 1990, between SCE and
Elmore (incorporated by reference to Exhibit 10.45 to the
Funding Corporation II Form S-4).
10.46 Funding Agreement, dated June 15, 1990, between SCE and
Leathers (incorporated by reference to Exhibit 10.46 to the
Funding Corporation II Form S-4).
10.47 Funding Agreement, dated May 18, 1990, between SCE and
Leathers (incorporated by reference to Exhibit 10.47 to the
Funding Corporation II Form S-4).
10.48 Funding Agreement, dated May 18, 1990, between SCE and
Vulcan (incorporated by reference to Exhibit 10.48 to the
Funding Corporation II Form S-4).
24. Power of Attorney
27. Financial Data Schedule.
EXHIBIT 4.1(e)
1SASM&F
Draft No. 1
FOURTH SUPPLEMENTAL INDENTURE
This FOURTH SUPPLEMENTAL INDENTURE, dated as of
September __, 1998 (this "Supplemental Indenture"), is by
and between SALTON SEA FUNDING CORPORATION, a Delaware
corporation (the "Funding Corporation"), and CHASE
MANHATTAN BANK AND TRUST COMPANY, NATIONAL ASSOCIATION, a
banking association organized under the federal laws of
the United States of America, as Trustee (together with
its successors in such capacity, the "Trustee").
W I T N E S S E T H:
WHEREAS, the Funding Corporation and the Trust
ee have entered into that certain Trust Indenture dated
as of July 21, 1995 (as amended, modified or supplemented
by that certain First Supplemental Indenture dated as of
October 18, 1995, that certain Second Supplemental
Indenture dated as of June 20, 1996, that certain Third
Supplemental Indenture dated as of [______ __, ____] and
this Supplemental Indenture, and as subsequently amended,
modified or supplemented, the "Indenture") by and between
the Funding Corporation and the Trustee;
WHEREAS, the Funding Corporation has been
formed for the sole purpose of issuing securities under
the Indenture, as principal and as agent for the Guaran
tors (as defined in the Indenture), and for entering into
those transactions incidental thereto;
WHEREAS, the Indenture provides that the terms
thereof may be amended or supplemented from time to time
by the Funding Corporation and the Trustee, without the
consent of the Holders (as defined in the Indenture),
pursuant to a supplemental indenture, for one or more of
the purposes set forth in Section 8.1 of the Indenture,
which purposes include, without limitation, to provide
for the issuance of Additional Securities (as defined in
the Indenture) on the conditions set forth in Section 2.3
of the Indenture;
WHEREAS, the Funding Corporation has determined
to issue $278,900,000 principal amount of [ ]% Series
F Senior Secured Notes due 2018 (the "Series F
Securities");
WHEREAS, $83,550,000 of the proceeds of the
Series F Securities will be loaned by the Funding
Corporation to the Salton Sea Guarantors (as defined in
the Indenture) for the following purposes: (i) to
finance the engineering, development, construction and
start-up of Salton Sea Unit V (as defined in the
Indenture); and (ii) to pay interest and other finance
charges during construction of Salton Sea Unit V; and
(iii) to pay certain transaction costs incurred in
connection with the issuance of the Series F Securities;
WHEREAS, $195,450,000 of the proceeds of the
Series F Securities will be loaned by the Funding
Corporation to the Partnership Guarantors (as defined in
the Indenture) for the following purposes: (i) to
finance the engineering, development, construction and
start-up of the Zinc Project (as defined in the
Indenture); (ii) to finance the engineering, development,
construction and start-up of the Region 2/Turbo Project
(as defined in the Indenture); (iii) to finance the
making of certain capital improvements to the existing
Salton Sea Projects (as defined in the Indenture) and the
existing Partnership Projects (as defined in the
Indenture); (iv) to pay interest and other finance
charges during construction of the Zinc Project and the
Region 2/Turbo Project; and (v) to pay certain
transaction costs incurred in connection with the
issuance of the Series F Securities; and
WHEREAS, the execution and delivery of the
Series F Securities and this Supplemental Indenture have
been duly authorized and all things necessary to make the
Series F Securities, when executed by the Funding Corpo
ration and authenticated by the Trustee, valid and bind
ing legal obligations of the Funding Corporation and to
make this Supplemental Indenture a valid and binding
agreement have been done.
NOW, THEREFORE, for and in consideration of the
premises and of the covenants herein contained and of the
purchase of the Series F Securities by the Holders (as
defined in the Indenture) thereof, it is mutually
covenanted and agreed, for the benefit of the parties
hereto and the equal and proportionate benefit of all
Holders of the Securities, as follows:
SECTION 1. Definitions. Capitalized terms
used in this Supplemental Indenture and not otherwise
defined herein shall have the meanings ascribed to such
terms in the Indenture.
SECTION 2. Series F Securities.
(a) The Series F Securities to be issued under
this Supplemental Indenture and the Indenture are hereby
created. The Funding Corporation may issue the Series F
Securities, in the form of Exhibit A hereto, upon the
execution of this Supplemental Indenture, and the Trustee
shall, at the Funding Corporation's written request,
authenticate the Series F Securities and deliver them as
specified in the request.
(b) The Series F Securities shall be dated
September __, 1998, shall be issued in the aggregate
principal amount of $278,900,000, shall have a final
maturity date of [________ __], 2018 and bear interest at
a rate per annum of [ ]%; provided that, pursuant to
the terms and provisions of the Series F Registration
Rights Agreement, the interest rate of the Series F Secu
rities shall be increased by [one half of one] percent
([0.50]%) per annum from and after the date that an
"Illiquidity Event" (as defined in the Series F
Registration Rights Agreement) occurs, and shall accrue
to but not including the date on which such Illiquidity
Event shall cease to exist. Notwithstanding that an
Illiquidity Event may cease to exist, if a Registration
Statement (as defined in the Series F Registration Rights
Agreement) has not become effective within two (2) years
after the initial issuance of the Series F Securities,
such increased interest rate shall become permanent,
pursuant to the terms and provisions of the Series F
Registration Rights Agreement. Notice of the occurrence
and cessation of any Illiquidity Event and the date, if
any, that a Registration Statement is declared effective
shall be set forth in an Officer's Certificate of the
Funding Corporation delivered to the Trustee and the
Depositary Agent within ten (10) Business Days after the
Funding Corporation has obtained knowledge of such event.
If an Illiquidity Event occurs subsequent to any Record
Date, the Person entitled to receive the increased amount
of interest payable as a result of such Illiquidity Event
shall receive such additional interest on the Interest
Payment Date relating to the next subsequent Record Date.
Series F Securities subsequently issued pursuant to Sec
tion 2.5(c) of the Indenture shall be dated as of the
date of authentication thereof.
(c) The principal of, premium (if any) and
interest on the Series F Securities shall be payable in
any coin or currency of the United States of America
which, at the respective dates of payment thereof, is
legal tender for the payment of public and private debts.
Payment of principal of and interest on the Series F
Securities shall be made (i) by check or draft mailed on
the Scheduled Payment Date therefor to the registered
owner as of the close of business on the Record Date
immediately preceding such Scheduled Payment Date, at his
address as it appears on the registration books of the
Trustee, or (ii) by wire transfer to such registered
owner as of the close of business on such Record Date
upon written notice of such wire transfer address in the
continental United States given not less than fifteen
(15) days prior to such Record Date; provided, however,
that if and to the extent that there shall be a default
in the payment of the interest or principal due on such
Scheduled Payment Date, such defaulted interest and/or
principal shall be paid to the Holder in whose name any
such Security is registered at the close of business on
the day determined by the Trustee as provided in Section
2.4 of the Indenture.
(d) Interest on the Series F Securities shall
be paid in arrears on each May 30th and November 30th,
commencing November 30, 1998 and concluding on the Final
Maturity Date for the Series F Securities. Interest on
the Series F Securities shall be computed upon the basis
of a 360-day year, consisting of twelve (12) thirty (30)
day months.
(e) Principal of the Series F Securities shall
be paid in an amount, and on the Scheduled Payment Dates,
as set forth with respect to the Series F Securities on
Schedule I hereto.
(f) The aggregate principal amount of the
Series F Securities that may be issued, authenticated and
delivered under the Indenture is $278,900,000 (except for
Securities issued, authenticated and delivered upon
registration of, transfer of, or in exchange for, or in
lieu of, other Series F Securities).
(g) The Record Date for the determination of
Holders to whom principal and interest is payable shall
be as provided in Section 2.4 of the Indenture.
(h) Series F Securities may be surrendered for
registration of transfer or exchange as provided in
Section 2.5 of the Indenture. Notices and demands to or
upon the Funding Corporation in respect of the Series F
Securities may be served as provided in Section 13.6 of
the Indenture.
(i) The Series F Securities may be redeemed,
pro rata within such series, at the election of the
Funding Corporation, as a whole or in part, at any time
on any Business Day, subject to the conditions and at the
Redemption Price (which will include a Series F Yield
Maintenance Premium) specified in the form of Series F
Security attached hereto as Exhibit A.
(j) The Funding Corporation may elect to
redeem the Series F Securities, pro rata within such
series, as a whole or in part, at any time on any
Business Day, at a redemption price equal to the
principal amount thereof with interest on the principal
amount thereof accrued through the Redemption Date, if
Substantial Completion (without giving effect to the
proviso to the definition thereof) of a New Project has
not occurred by the Guaranteed Substantial Completion
Date for such New Project. Any such redemption shall
cause Substantial Completion of such New Project to
occur, notwithstanding the failure of such New Project to
satisfy the conditions described in clauses (i) through
(v) of the definition of Substantial Completion, if,
after giving effect to such redemption, (i) the minimum
projected Debt Service Coverage Ratio (calculated using
the Base Case Projections) for (a) the next four (4)
consecutive fiscal quarters, commencing with the quarter
in which such redemption is to occur, taken as one (1)
annual period, and (b) each subsequent fiscal year until
the Final Maturity Date for the Series F Securities, will
not be less than 1.4 to 1.0, and (ii) the average
projected Debt Service Coverage Ratio (calculated using
the Base Case Projections) for all succeeding fiscal
years until the Final Maturity Date for the Series F
Securities will not be less than 1.7 to 1.0, in each case
as certified to the Trustee by an Authorized Officer of
the Funding Corporation and confirmed by the [New
Project] Independent Engineer and, with respect to the
Zinc Project, the Independent Zinc Market Consultant.
(k) The Series F Securities shall be subject
to mandatory redemption and shall be redeemed, ratably
with each other series of Securities, as a whole or in
part, prior to maturity, at a redemption price equal to
the principal amount thereof with interest on the princi
pal amount thereof accrued through the Redemption Date,
as provided in Section 3.3 of the Indenture.
(l) The Series F Securities shall be redeemed,
pro rata within such series, as a whole or in part, prior
to maturity, at a redemption price equal to the principal
amount thereof with interest on the principal amount
thereof accrued through the Redemption Date, if the
Salton Sea Guarantors and the Partnership Guarantors
receive Total Performance Liquidated Damages of more than
$[INSERT DOLLAR AMOUNT EQUAL TO 2% OF SUM OF EPC CONTRACT
PRICES], in which case all Performance Liquidated Damages
received by the Salton Sea Guarantors and the Partnership
Guarantors shall be made available for such redemption,
subject to reduction by the amount of such Performance
Liquidated Damages used to pay costs associated with the
construction of any New Project in accordance with an
Approved Completion Plan. Any redemption of Series F
Securities made in accordance with this clause (l) shall
be deemed an election by the Funding Corporation to
redeem Series F Securities in accordance with clause (j)
of this Section 2. All monies received by the Trustee
from the Depositary Agent pursuant to Section [ ] of
the Depositary Agreement shall be deposited in the
Mandatory Redemption Fund and applied by the Trustee to a
pro rata redemption of the Series F Securities in
accordance with this clause (l). The Redemption Date for
any such redemption shall be any date, as selected by the
Trustee, during the 90-day period following such receipt
of monies by the Trustee.
(m) If Substantial Completion of any New
Project has not occurred by the Guaranteed Substantial
Completion Date for such New Project, or if any New
Project has been abandoned, in each case evidenced by the
certifications specified in Section 5.21 of the Indenture
and received by the Trustee, outstanding Series F Securi
ties in an aggregate principal amount of (x) in the case
of the Zinc Project, $122,500,000, (y) in the case of
Salton Sea Unit V, $73,500,000, and (z) in the case of
the Region 2/Turbo Project, $38,000,000, shall be re
deemed prior to maturity at a redemption price equal to
such principal amount, together with interest on such
principal amount accrued through the Redemption Date;
provided that such redemption will not be required if the
Funding Corporation and the Guarantors take such actions
as the Rating Agencies require in order for the Rating
Agencies to confirm in writing that the Securities will
maintain their Investment Grade Ratings notwithstanding
the failure of such New Project to achieve Substantial
Completion by the Guaranteed Substantial Completion Date
therefor or such abandonment, as the case may be, and the
Rating Agencies issue such written confirmation. Upon
notice by the Trustee to the Funding Corporation of
mandatory redemption upon certification of the failure of
a New Project to achieve Substantial Completion by the
Guaranteed Substantial Completion Date therefor or of
abandonment of a New Project, the Funding Corporation
shall deposit with the Trustee an amount which equals the
applicable principal amount of Series F Securities
required to be redeemed, together with interest on such
amount accrued through the Redemption Date. Any such
moneys deposited with the Trustee shall be applied by the
Trustee to the pro rata redemption of the Series F Securi
ties pursuant to this clause (m). The Redemption Date
for any such redemption shall be any date determined by
the Trustee during the 90-day period following the date
of the Trustee's receipt of the certifications required
by Section 5.21 of the Indenture that the relevant New
Project has not been completed by the Guaranteed
Substantial Completion Date therefor or has been aban
doned, as the case may be (taking into account the notice
requirements set forth in Section 3.4 of the Indenture).
(n) Restrictions and limitations on the trans
fer or exchange of the Series F Securities shall be as
provided in the Indenture and the form of Series F
Security attached hereto as Exhibit A.
(o) The Funding Corporation has entered into
the Series F Registration Rights Agreement, pursuant to
which it has agreed to use its reasonable best efforts to
file and have declared effective a registration statement
with respect to an exchange offer to exchange the Series
F Securities for a series of securities substantially
identical to the Series F Securities.
(p) The Trustee shall act as Trustee, Custodi
an, Registrar and Paying Agent for the Series F Securi
ties, as and to the extent provided in the Indenture.
(q) The Series F Securities shall be issuable
in denominations of $100,000 and any integral multiple of
$1,000 in excess thereof.
SECTION 3. Amendments to Indenture.
(a) Section 2.5 of the Indenture is hereby
amended by deleting the current clause (j) of such
Section and replacing it with the following new clause
(j):
"(j) Any Securities which are presented to
the Registrar for exchange pursuant to an Exchange
Offer shall be exchanged for Exchange Securities of
the same series and of equal principal amount upon
surrender to the Registrar of the Securities to be
exchanged; provided, however, that the Securities so
surrendered for exchange shall be duly endorsed and
accompanied by a letter of transmittal or written
instrument of transfer in form satisfactory to the
Funding Corporation and the Registrar, duly executed
by the Holder thereof or its attorney who shall be
duly authorized in writing to execute such document.
Whenever any Securities are so surrendered for
exchange, the Funding Corporation shall execute, and
the Trustee shall authenticate and deliver to the
Registrar, the same aggregate principal amount of Ex
change Securities of the same series that have been
surrendered."
(b) Section 2.11 of the Indenture is hereby
amended by (i) deleting the word "Initial" after the
phrase "Net Proceeds of" in the title of such Section and
(ii) deleting the word "Initial" after the phrase "from
the sale of the" in the text of such Section.
(c) Section 3.1 of the Indenture is hereby
amended by inserting the following sentence at the end of
such Section:
"The Series F Securities may be redeemed, pro
rata within such series, at the election of the
Funding Corporation, as a whole or in part, at
any time on any Business Day, subject to the
conditions and at the Redemption Price (which
will include a Series F Yield Maintenance
Premium) specified in the form of Series F
Security attached as Exhibit A to that certain
Fourth Supplemental Indenture dated as of
September __, 1998, by and between the Funding
Corporation and the Trustee."
(d) Section 4.9 of the Indenture is hereby
amended by deleting the phrase "the Partnership
Guarantors" after the phrase "including its ownership of
1% of" and replacing it with the terms "CEOC, VPC".
(e) Section 4.11 of the Indenture is hereby
amended by (i) inserting the word "not" after the phrase
"under which they were made, " in the second sentence of
such Section and (ii) inserting the following sentence at
the end of such Section:
"Each of the Series F Preliminary Offering Circular
and the Series F Final Offering Circular as of its
date did not, and the Series F Final Offering
Circular (as the same may have been amended or
supplemented) as of the date of the issuance of the
Series F Securities will not, contain any untrue
statement of a material fact or omit to state any
material fact necessary to make the statements
therein, in the light of the circumstances under
which they were made, not misleading."
(f) Article V of the Indenture is hereby
amended by inserting the following new Section 5.21 at
the end of such Article:
"SECTION 5.21 New Projects. The Funding
Corporation shall deliver to the Trustee, for each
New Project, an Officer's Certificate containing
customary assumptions and qualifications, substan
tially in the form of Exhibit E attached hereto
(which, in the case of (i) and (ii) below, will be
confirmed as reasonable, based on the material pre
sented therein (containing customary assumptions and
qualifications), by the [New Project] Independent
Engineer), on the earlier of (i) Substantial Com
pletion of such New Project, certifying that
Substantial Completion of such New Project has
occurred, (ii) the Guaranteed Substantial Completion
Date for such New Project, certifying that, as of
such Guaranteed Substantial Completion Date, Substan
tial Completion of such New Project has occurred or
not occurred, as the case may be, and (iii) abandon
ment of such New Project, certifying that such New
Project has been abandoned. The Trustee may
conclusively rely on such Officer's Certificate and
confirmation of the [New Project] Independent
Engineer without further investigation or inquiry."
(g) Section 5.2 of the Indenture is hereby
amended by inserting the following phrase after the
phrase "shall furnish to the Trustee" in the introductory
portion of such Section:
" and, in the case of clauses (a) and (b) of this
Section 5.2, the Rating Agencies and any Holder or
any owner of a beneficial interest in a Global
Security upon request (which request may indicate
that it is a continuing request for such information
until further notice from such owner of a beneficial
interest in a Global Security to the contrary)".
(h) Section 5.4 of the Indenture is hereby
amended by (i) inserting the phrase " and the Partnership
Credit Agreement" after the phrase "insurance required
pursuant to the Salton Sea Credit Agreement" in the first
sentence of such Section, (ii) inserting the phrase " and
the Partnership Guarantors" after the phrase "will cause
the Salton Sea Guarantors" in the second sentence of such
Section and (iii) inserting the phrase " and the
Partnership Projects" after the phrase "relating to the
Salton Sea Projects" in the second sentence of such
Section.
(i) Section 6.1 of the Indenture is hereby
amended by (i) deleting the period (".") at the end of
clause (l) of such Section and replacing it with a
semicolon (";") followed by the word "or" and (ii)
inserting the following clause at the end of such
Section:
"(m) CalEnergy fails to perform or breaches any
of its obligations under the Equity Commitment
Agreement and such failure or breach continues for
15 days or more."
(j) Section 6.1(i) of the Indenture is hereby
amended by (i) deleting the word "or" before the phrase
"(iii) at least 51%" and (ii) inserting the following
clause after the phrase "Voting Stock of Fish Lake":
", or (iv) at least 50% of the membership
voting interests and economic interests in each
of CalEnergy Minerals, Salton Sea Power and CE
Turbo".
(k) Section 7.1(e) of the Indenture is hereby
amended by (i) deleting the word "Initial" after the
phrase "percentage of Holders of" in clause (i) of the
last sentence of such Section and (ii) deleting the word
"Initial" after the phrase "manner in which such Holders
of" in clause (ii) of the last sentence of such Section.
(l) Section 11.12(a) of the Indenture is
hereby amended by (i) [replacing the delivery address
following the phrase "for delivery by hand:" with the
following delivery address:
"[The Chase Manhattan Bank]
[Corporate Teller]
[55 Water Street, Room 234]
[2nd Floor, North Building]
[New York, New York [_____]]",]
and (ii) replacing the delivery address and contact
person following the phrase "or for delivery by mail:"
with the following delivery address and contact person:
"Chase Manhattan Bank and Trust Company, National
Association
101 California Street, #2725
San Francisco, California 94111
Attention: Corporate Trust Department".
(m) Article XII of the Indenture is hereby
amended by inserting the following new Section 12.3 at
the end of such Article:
"SECTION 12.3 Information to Holders.
With respect to the information and documents
required to be delivered to the Trustee by the
Funding Corporation pursuant to Rule 144A(d) under
the Securities Act or pursuant to this Indenture,
the Trustee shall deliver, at the expense of the
Funding Corporation, any such documents and
information (a) to each Holder and (b) to any
beneficial holder of Securities who makes a request
to the Trustee substantially in the form of Exhibit
J-1 hereto (which request may indicate that it is a
continuing request for such information until
further notice from such owner of a beneficial
interest in a Global Security to the contrary) for
such documents or information. Upon request (which
request may indicate that it is a continuing request
for such information until further notice from such
owner of a beneficial interest in a Global Security
to the contrary) of any owner of a beneficial
interest in a Global Security or a Holder of a
certificated Security substantially in the form of
Exhibit J-2 hereto, the Funding Corporation shall
deliver all financial information required to be
delivered pursuant to this Indenture directly to
such owner of a beneficial interest in a Global
Security or Holder. Further, upon request (which
request may indicate that it is a continuing request
for such information until further notice from such
owner of a beneficial interest in a Global Security
to the contrary) of any beneficial owner of
$2,000,000 aggregate original principal amount or
more of Securities, the Funding Corporation shall
deliver all reasonable information regarding the
payment of all taxes directly to such beneficial
owner for informational purposes only; provided that
the Funding Corporation shall make available for
inspection by the holders of beneficial interests in
the Securities or their agents at the principal
executive office of the Funding Corporation, upon
their request, reasonable information regarding the
payment of all taxes."
(n) Section 13.6(a) of the Indenture is hereby
amended by replacing the delivery address and contact
person following the word "Trustee:" with the following
delivery address and contact person:
"Chase Manhattan Bank and Trust Company, National
Association
101 California Street, #2725
San Francisco, California 94111
Telephone: (415) [_______]
Fax: (415) [_______]
Attention: Corporate Trust Department".
(o) The Indenture is hereby amended by adding
as Appendix A thereto the Base Case Projections attached
as Appendix A hereto.
(p) The Indenture is hereby amended by adding
as Exhibit E thereto the form of Officer's Certificate
attached as Exhibit B hereto.
(q) The Indenture is hereby amended by adding
as Exhibit F-1 and Exhibit F-2 thereto the forms of
requests for information attached as Exhibit C-1 and
Exhibit C-2 hereto, respectively.
(r) Exhibit A of the Indenture is hereby
amended by:
(i) deleting the definition of "Agency
Agreements" and inserting the following definition in
lieu thereof:
""Agency Agreements" means: (i) the
separate Agency Agreements, each dated as of the
Closing Date, between the Funding Corporation and
each of SSBP, SSPG, Fish Lake, VPC, CEOC and the
Royalty Guarantor; (ii) the Agency Agreement, dated
as of June 20, 1996, among the Funding Corporation,
San Felipe, BN/Geothermal, Niguel, Conejo, Leathers,
Del Ranch, Elmore and Vulcan; and (iii) the Agency
Agreement, dated as of September __, 1998, among the
Funding Corporation, CalEnergy Minerals, Salton Sea
Power and CE Turbo; in each case as amended or
supplemented from time to time.";
(ii) (A) deleting the word "and" after the
term "Elmore" and replacing it with a comma (",") and (B)
inserting the phrase ", CalEnergy Minerals and CE Turbo"
after the word "Del Ranch", in each case in clause (b) of
the definition of "Available Cash Flow";
(iii) deleting the definition of
"CEOC" and inserting the following definition in lieu
thereof:
""CEOC" means CalEnergy Operating
Corporation, a Delaware corporation.";
(iv) deleting the name "Chemical Trust
Company of California" and replacing it with the name
"Chase Manhattan Bank and Trust Company, National
Association," in the definition of "Collateral Agent";
(v) (A) inserting the parenthetical "(if
any)" after the phrase "relevant Power Purchase
Agreement" and (B) inserting the phrase "or selling
electricity or zinc into the market for such product"
after the phrase "delivering electricity in accordance
therewith", in each case in the definition of "Commercial
Operation";
(vi) inserting the word "Agent" after the
word "Depositary" in the definition of "Debt Service
Reserve Letter of Credit";
(vii) deleting the name "Chemical
Trust Company of California" and replacing it with the
name "Chase Manhattan Bank and Trust Company, National
Association," in the definition of "Depositary Agent";
(viii) deleting the definition of
"Depositary Agreement" and inserting the following
definition in lieu thereof:
""Depositary Agreement" means the Amended
and Restated Deposit and Disbursement Agreement,
dated as of September __, 1998, among the Funding
Corporation, the Guarantors, the Collateral Agent
and the Depositary Agent.";
(ix) inserting the phrase ", the Equity
Commitment Agreement" after the term "Guarantees" in the
definition of "Financing Documents";
(x) deleting the words "Salton Sea"
before the phrase "Guarantors, taken as a whole," in
clause (i) of the definition of "Material Adverse
Effect";
(xi) (A) inserting the phrase "or
membership" after the word "partnership" in clause (ii)
and (B) inserting the phrase ", Zinc Construction Fund,
Region 2/Turbo Construction Fund, Construction Period
Debt Service Fund" after the term "Capital Expenditure
Fund" in clause (iii), in each case in the definition of
"Partnership Collateral";
(xii) inserting the phrase ", as
amended, restated or supplemented from time to time in
accordance with the terms thereof" after the term
"Partnership Guarantors" in the definition of "Partner
ship Credit Agreement";
(xiii) (A) deleting the word "and"
before the phrase "(iv) the Deed of Trust" in clause
(iii) and (B) inserting the following clauses after the
phrase "in favor of the Collateral Agent" in clause (iv),
in each case in the definition of "Partnership Deed of
Trust":
", (v) the Deed of Trust, Assignment of Rents,
Security Agreement and Fixture Filing by CalEnergy
Minerals in favor of the Collateral Agent and (vi)
the Deed of Trust, Assignment of Rents, Security
Agreement and Fixture Filing by CE Turbo in favor of
the Collateral Agent";
(xiv) deleting the definition of
"Partnership Guarantee" and inserting the following
definition in lieu thereof:
""Partnership Guarantee" means the Amended
and Restated Partnership Secured Limited Guarantee,
dated as of September __, 1998, by the Partnership
Guarantors in favor of the Trustee and the
Collateral Agent for the benefit of the Secured
Parties and the Funding Corporation.";
(xv) (A) deleting the word "and" after the
term "Leathers" and replacing it with a comma (",") and
(B) inserting the phrase ", CalEnergy Minerals and CE
Turbo" after the term "Del Ranch", in each case in the
definition of "Partnership Guarantors";
(xvi) (A) deleting the word "and"
before the phrase "(viii) the Partnership Interest Pledge
Agreement" in clause (vii) and replacing it with a comma
(",") and (B) inserting the following clauses after the
term "Secured Parties" in clause (viii), in each case in
the definition of "Partnership Guarantors Pledge
Agreement":
", (ix) the Stock Pledge Agreement by Magma pledging
the stock of Minerals Corp., in favor of the
Collateral Agent for the benefit of the Secured
Parties, (x) the Stock Pledge Agreement by Magma
pledging the stock of CE Salton Sea, in favor the
Collateral Agent for the benefit of the Secured
Parties, (xi) the Membership Interest Pledge
Agreement by Magma and Minerals Corp. pledging the
membership interests in CalEnergy Minerals, in favor
of the Collateral Agent for the benefit of the
Secured Parties, and (xi) the Membership Interest
Pledge Agreement by Magma and CE Salton Sea pledging
the membership interests in CE Turbo, in favor of
the Collateral Agent for the benefit of the Secured
Parties";
(xvii) (A) deleting the word "and"
after the term "Leathers" and replacing it with a comma
(",") and (B) inserting the phrase ", CalEnergy Minerals
and CE Turbo" after the term "Vulcan", in each case in
the definition of "Partnership Project Companies";
(xviii) (A) deleting the word "and"
after the phrase "the VPC Agreements" and replacing it
with the a comma (",") and (B) inserting the phrase
", the Zinc Agreements and the Region 2/Turbo Agreements"
after the phrase "the CEOC Agreements", in each case in
the definition of "Partnership Project Documents";
(xix) (A) deleting the word "and"
after the phrase "the Del Ranch Project" and replacing it
with a comma (",") and (B) inserting the phrase ", the
Zinc Project and the Region 2/Turbo Project" after the
phrase "the Leathers Project", in each case in the
definition of "Partnership Projects";
(xx) inserting the phrase "the Partnership
Deed of Trust, the Partnership Collateral Assignments,"
before the phrase "the Partnership Guarantors Security
Agreement" in the definition of "Partnership Security
Documents";
(xxi) inserting the phrase ", limited
liability company" after the word "partnership" in the
definition of "Person";
(xxii) (A) inserting the term ", Salton
Sea Unit V" after the term "Salton Sea Unit IV" and (B)
inserting the phrase ", Zinc Project, Region 2/Turbo
Project" after the term "East Mesa Project", in each case
in the definition of "Projects";
(xxiii) deleting the definition of
"Registration Rights Agreement" and inserting the
following definition in lieu thereof:
""Registration Rights Agreement" means:
(i) the Exchange and Registration Rights Agreement,
dated as of the Closing Date, between the Funding
Corporation and the Initial Purchasers for the
benefit of the Holders of the Initial Securities;
(ii) the Exchange and Registration Rights Agreement,
dated as of June 20, 1996, between the Funding
Corporation and the initial purchaser named therein
for the benefit of the Holders of the Series D and E
Securities; and (iii) the Series F Registration
Rights Agreement.";
(xxiv) inserting the phrase ", or any
similar legend set forth in any form of Security attached
to a Supplemental Indenture" in the definition of
"Restricted Security";
(xxv) (A) inserting the phrase "or
membership" after the word "partnership" in clause (iv)
and (B) inserting the phrase "Salton Sea Unit V
Construction Fund, Construction Period Debt Service Fund"
after the term "Expansion Fund" in clause (v), in each
case in the definition of "Salton Sea Collateral";
(xxvi) deleting the definition of
"Salton Sea Collateral Assignments" and inserting the
following definition in lieu thereof:
""Salton Sea Collateral Assignments"
means: (i) the Collateral Assignment (IID
Agreements), dated as of the Closing Date, by SSPG
in favor of the Collateral Agent for the benefit of
the Secured Parties; (ii) the Collateral Assignment
(SCE Agreements), dated as of the Closing Date, by
SSPG in favor of the Collateral Agent for the
benefit of the Secured Parties; (iii) the Collateral
Assignment, dated as of the Closing Date, by SSBP,
SSPG and Fish Lake in favor of the Collateral Agent
for the benefit of the Secured Parties; (iv) the
Collateral Assignment (IID Agreements), dated as of
September __, 1998, by Salton Sea Power in favor of
the Collateral Agent for the benefit of the Secured
Parties; and (v) the Collateral Assignment (Other
Unit V Project Documents), dated as of September __,
1998, by Salton Sea Power in favor of the Collateral
Agent.";
(xxvii) deleting the definition of
"Salton Sea Credit Agreement" and inserting the following
definition in lieu thereof:
""Salton Sea Credit Agreement" means the
Credit Agreement between the Funding Corporation and
each of the Salton Sea Guarantors, as amended,
restated or supplemented from time to time in
accordance with the terms thereof."
(xxviii) inserting the following phrase
after the phrase "in favor of the Collateral Agent" in
the definition of "Salton Sea Deed of Trust":
", and the Deed of Trust, Assignment of Rents,
Security Agreement and Fixture Filing, dated as of
September __, 1998, by Salton Sea Power in favor of
the Collateral Agent";
(xxix) deleting the definition of "Salton
Sea Guarantee" and inserting the following definition in
lieu thereof:
""Salton Sea Guarantee" means the Amended
and Restated Salton Sea Secured Guarantee, dated as
of September __, 1998, by the Salton Sea Guarantors
in favor of the Trustee and the Collateral Agent for
the benefit of the Secured Parties.";
(xxx) deleting the definition of
"Salton Sea Guarantors" and inserting the following
definition in lieu thereof:
""Salton Sea Guarantors" means each of
SSBP, SSPG, Fish Lake and Salton Sea Power.";
(xxxi) inserting the phrase ", the
Salton Sea Unit V Agreements" after the term "SSPG IV
Technology Transfer Agreement" in the definition of
"Salton Sea Project Documents";
(xxxii) (A) deleting the word "and"
after the term "Salton Sea Unit III and replacing it with
a comma (",") and (B) inserting the phrase ", and Salton
Sea Unit V" after the term "Salton Sea Unit IV", in each
case in the definition of "Salton Sea Projects";
(xxxiii) deleting the definition of
"Salton Sea Security Documents" and inserting the
following definition in lieu thereof:
""Salton Sea Security Documents" means the
Salton Sea Deed of Trust, the Salton Sea Collateral
Assignments, the Salton Sea Guarantors Pledge Agree
ments and all other Security Documents securing the
obligations of the Salton Sea Guarantors under the
Salton Sea Guarantee and the Salton Sea Project
Note."
(xxxiv) inserting the phrase ", the
Securities Account Control Agreement" after the term
"Depositary Agreement" in the definition of "Security
Documents";
(xxxv) deleting the definition of
"Substantial Completion" and inserting the following
definition in lieu thereof:
""Substantial Completion" of a Project
means that (i) such Project is substantially
complete in accordance with the construction con
tracts therefor and all applicable laws and permits,
(ii) all services and equipment required to be
furnished by the contractors for such Project are
substantially completed and all material equipment
for such Project has been delivered and properly
incorporated, (iii) all necessary performance and
start-up testing and other pre-commissioning activi
ties for such Project have been conducted, (iv) a
punchlist of items to be finished or completed for
such Project has been prepared, and (v) all events
necessary to allow commercial operation of such
Project to be declared have been met, in each case
as confirmed by the Independent Engineer [or, in the
case of a New Project, the New Project Independent
Engineer]; provided, however, that Substantial
Completion of a New Project shall be deemed to have
occurred, notwithstanding such New Project's failure
to satisfy the conditions set forth in clauses (i)
through (v) above, if the Funding Corporation shall
have redeemed an amount of Series F Securities
sufficient to cause Substantial Completion of such
New Project in accordance with Section 2(j) of the
Fourth Supplemental Indenture, dated as of September
__, 1998, between the Funding Corporation and the
Trustee.";
(xxxvi) inserting the phrase "or a
Partnership Project" after the term "Salton Sea Project"
in the definition of "Title Event";
(xxxvii) deleting the phrase "the Person
named as "Trustee" in the Preamble of this Indenture" and
replacing it with the name "Chase Manhattan Bank and
Trust Company, National Association," in the definition
of "Trustee";
(xxxviii) deleting the definitions of
"Fish Lake Pledge Agreement", "Partnership Interest
Pledge Agreement" and "Salton Sea Partnership Interest
Pledge Agreement".
(s) Exhibit A to the Indenture is hereby
amended by inserting the following definitions in the
appropriate alphabetical order:
""Approved Completion Plan" means a plan
(including budget and schedule) to construct and complete
a New Project using liquidated damages payments and/or
other funds available to the Funding Corporation and the
relevant Guarantor (by borrowing or otherwise), which
plan includes: (i) an Officer's
Certificate of the relevant Guarantor, confirmed (with
customary assumptions and qualifications) as reasonable
by the [New Project] Independent Engineer and, in the
case of the Zinc Project, the Independent Zinc Market
Consultant, stating that (a) the funds available to the
relevant Guarantor are reasonably expected to be
sufficient to achieve Substantial Completion of such New
Project and (b) after achieving Substantial Completion,
(1) the minimum projected Debt Service Coverage Ratio
(calculated using the Base Case Projections) for (A) the
next four (4) consecutive fiscal quarters, commencing
with the quarter in which Substantial Completion of such
New Project is to occur, taken as one (1) annual period,
and (B) each subsequent fiscal year thereafter until the
Final Maturity Date for the Series F Securities, will not
be less than 1.4 to 1.0, and (2) the average projected
Debt Service Coverage Ratio (calculated using the Base
Case Projections) for all succeeding fiscal years until
the Final Maturity Date for the Series F Securities will
not be less than 1.7 to 1.0; or (ii) a confirmation from
the Rating Agencies that the Securities will maintain
their Investment Grade Ratings after achieving
Substantial Completion of such New Project in accordance
with such plan."
""Approved Construction Budget and Schedule"
means, for each New Project, the construction budget and
schedule (containing customary assumptions and
qualifications) prepared by the relevant Guarantor and
confirmed as reasonable by the [New Project] Independent
Engineer as of September __, 1998, as may thereafter be
amended in connection with an event of force majeure, an
event of default or a change order under the EPC Contract
for such New Project, provided that the [New Project]
Independent Engineer confirms as reasonable the
certification of the relevant Guarantor that (a) such
amendment could not reasonably be expected to result in a
Material Adverse Effect and (b) the funds available to
such Guarantor (from the relevant Construction Fund,
under the Equity Commitment Agreement, from liquidated
damages payments, from borrowings or otherwise) are
reasonably expected to be sufficient to fund the costs of
achieving Substantial Completion of such New Project."
""Base Case Projections" means the price
projections attached as Appendix A hereto."
""CalEnergy Minerals" means CalEnergy Minerals
L.L.C., a Delaware limited liability company."
""CE Salton Sea" means CE Salton Sea Inc., a
Delaware corporation."
""CE Turbo" means CE Turbo LLC, a Delaware
limited liability company."
""Construction Fund" means each of the Zinc
Construction Fund, the Salton Sea Unit V Construction
Fund and the Region 2/Turbo Construction Fund."
""Construction Period Debt Service Fund" means
the fund of such name created under the Depositary
Agreement."
""DVC" means Desert Valley Company, a
California corporation."
""EPC Contract" means each of the Zinc EPC
Contract, the Salton Sea Unit V EPC Contract the Region
2/Turbo EPC Contract."
""EPC Contractor" means each of the Zinc EPC
Contractor, the Salton Sea Unit V EPC Contractor and the
Region 2/Turbo EPC Contractor."
""Equity Commitment Agreement" means the Equity
Commitment Agreement, dated as of September __, 1998,
among CalEnergy, the Funding Corporation, CalEnergy
Minerals, Salton Sea Power, CE Turbo and the Collateral
Agent for the benefit of the Secured Parties."
""Guaranteed Substantial Completion Date" means
(i) with respect to the Zinc Project, July 31, 2001, (ii)
with respect to Salton Sea Unit V, June 30, 2001, and
(iii) with respect to the Region 2/Turbo Project, January
31, 2001, in each case as may be amended pursuant to an
Approved Completion Plan."
""Imperial Magma" means Imperial Magma, a
Nevada corporation."
""Independent Zinc Market Consultant" means
Resource Strategies International or another widely
recognized Independent commodities market consulting firm
or consultant retained as independent zinc market
consultant by the Funding Corporation."
""Minerals Corp." means Salton Sea Minerals
Corp., a Delaware corporation."
""New Project" means each of the Zinc Project,
Salton Sea Unit V and the Region 2/Turbo Project."
[""New Project Independent Engineer" means
Duke/Fluor Daniel or another widely recognized
Independent engineering firm or engineer retained as
independent engineer for the New Projects by the Funding
Corporation."]
""Partnership Collateral Assignments" means:
(i) the Collateral Assignment (IID Agreements), dated as
of September __, 1998, by CalEnergy Minerals and CE Turbo
in favor of the Collateral Agent for the benefit of the
Secured Parties; (ii) the Collateral Assignment (Water
Supply Agreement), dated as of September __, 1998, by
CalEnergy Minerals in favor of the Collateral Agent for
the benefit of the Secured Parties; and (iii) the
Collateral Assignment (Other Partnership Project
Documents), dated as of September __, 1998, by CalEnergy
Minerals and CE Turbo in favor of the Collateral Agent
for the benefit of the Secured Parties."
""Performance Liquidated Damages" means any
liquidated damages payable by an EPC Contractor to one or
more Guarantors pursuant to an EPC Contract as a
consequence of a New Project's failure to meet the
performance guarantees set forth in such EPC Contract."
""Region 2/Turbo Agreements" means,
collectively, the Region 2/Turbo Technology Transfer
Agreement, the Region 2/Turbo EPC Contract, the Region
2/Turbo EPC Guaranty, the Region 2/Turbo O&M Agreement,
the Region 2/Turbo ASA, the Region 2/Turbo Plant
Connection Agreement, the Region 2/Turbo Transmission
Service Agreement, the Region 2/Turbo Construction
Agreement, the Region 2/Turbo Easements, [OTHERS] and any
Additional Project Document entered into by CE Turbo with
respect to the Region 2/Turbo Project."
""Region 2/Turbo ASA" means the Turbo Expander
Administrative Services Agreement, dated as of September
__, 1998, between Magma and CE Turbo."
""Region 2/Turbo Construction Agreement" means
the Construction Agreement for Turbo Expander Connection
Facilities, dated as of September __, 1998, between IID
and CE Turbo."
""Region 2/Turbo Construction Fund" means the
fund of such name created under the Depositary
Agreement."
""Region 2/Turbo Easements"" means (i) the
Reciprocal Easement Agreement, dated as of September __,
1998, among Del Ranch, Vulcan and CE Turbo, and (ii) the
Easement Agreement, dated as of September __, 1998,
between Magma and CE Turbo."
""Region 2/Turbo EPC Contract" means the
Engineering, Procurement and Construction Contract, dated
as of [________], 1998, between the Region 2/EPC
Contractor and CE Turbo."
""Region 2/Turbo EPC Contractor" means Stone &
Webster Engineering Corporation, a Massachusetts
corporation."
""Region 2/Turbo EPC Guaranty" means the
Guaranty, dated as of September __, 1998, between Stone &
Webster Inc., a Delaware corporation, and CE Turbo."
""Region 2/Turbo O&M Agreement" means the Turbo
Expander Operating and Maintenance Agreement, dated as of
September __, 1998, between CEOC and CE Turbo."
""Region 2/Turbo Plant Connection Agreement"
means the Plant Connection Agreement for Turbo Expander,
dated as of September __, 1998,
between IID and CE Turbo."
""Region 2/Turbo Project" means (i) the upgrade
of the brine systems at the [________] Projects and (ii)
the 10 MW turbo expander 100% owned by CE Turbo, located
in the Salton Sea Known Geothermal Resource Area."
""Region 2/Turbo Technology Transfer Agreement"
means the Turbo Expander Technology Transfer Agreement,
dated as of September __, 1998, between Magma and CE
Turbo."
""Region 2/Turbo Transmission Service
Agreement" means the Transmission Service Agreement for
Turbo Expander, dated as of September __, 1998, between
IID and CE Turbo."
""Salton Sea Guarantors Pledge Agreements"
means: (i) the Partnership Interest Pledge Agreement,
dated as of the Closing Date, by Magma and SSPC, pledging
the partnership interests in SSBP in favor of the Collat
eral Agent for the benefit of the Secured Parties and the
Funding Corporation; (ii) the Partnership Interest Pledge
Agreement, dated as of the Closing Date, by SSPC and
SSBP, pledging the partnership interests in SSPG, in
favor of the Collateral Agent for the benefit of the
Secured Parties and the Funding Corporation; (iii) the
Stock Pledge Agreement, dated as of the Closing Date, by
Magma and the Funding Corporation, pledging the stock of
Fish Lake in favor of the Collateral Agent for the
benefit of the Secured Parties; (iv) the Stock Pledge
Agreement, dated as of September __, 1998, by Magma,
pledging of the stock of CE Salton Sea in favor of the
Collateral Agent for the benefit of the Secured Parties
and the Funding Corporation; and (v) the Membership
Interest Pledge Agreement, dated as of September __,
1998, by Magma and CE Salton Sea, pledging the membership
interests in Salton Sea Power in favor the Collateral
Agent for the benefit of the Secured Parties and the
Funding Corporation."
""Salton Sea Power" means Salton Sea Power
L.L.C., a Delaware limited liability company."
""Salton Sea Unit V" means the 49 MW contract
nameplate geothermal power plant 100% owned by Salton Sea
Power, located in the Salton Sea Known Geothermal
Resource Area."
""Salton Sea Unit V Agreements" means,
collectively, the Salton Sea Unit V Technology Transfer
Agreement, the Salton Sea Unit V EPC Contract, the Salton
Sea Unit V EPC Guaranty, the Salton Sea Unit V O&M
Agreement, the Salton Sea Unit V ASA, the Salton Sea Unit
V Plant Connection Agreement, the Salton Sea Unit V
Construction Agreement, the Salton Sea Unit V
Transmission Service Agreement, the Salton Sea Unit V
Waste Disposal Agreement, the Salton Sea Unit V Power
Sales Agreement, the Salton Sea Unit V Geothermal Sales
Agreement, the Salton Sea Unit V Ground Lease, the Salton
Sea Unit V Easement [OTHERS] and any Additional Project
Document entered into by Salton Sea Power with respect to
Salton Sea Unit V."
""Salton Sea Unit V ASA" means the Unit 5
Administrative Services Agreement, dated as of September
__, 1998, between Magma and Salton Sea Power."
""Salton Sea Unit V Construction Agreement"
means the Construction Agreement for Salton Sea Unit 5
Connection Facilities, dated as of April 14, 1998,
between IID and Salton Sea Power."
""Salton Sea Unit V Construction Fund" means
the fund of such name created under the Depositary
Agreement."
""Salton Sea Unit V Easement"" means the
Reciprocal Easement, dated as of September __, 1998,
among SSBP, SSPG and Salton Sea Power."
""Salton Sea Unit V EPC Contract" means the
Engineering, Procurement and Construction Contract, dated
as of [________], 1998, between the Salton Sea Unit V EPC
Contractor and Salton Sea Power."
""Salton Sea Unit V EPC Contractor" means Stone
& Webster Engineering Corporation, a Massachusetts
corporation."
""Salton Sea Unit V EPC Guaranty" means the
Guaranty, dated as of September __, 1998, between Stone &
Webster Inc., a Delaware corporation, and Salton Sea
Power."
""Salton Sea Unit V Geothermal Sales Agreement"
means the Geothermal Sales Contract, dated as of
September __, 1998, between SSBP and Salton Sea Power."
""Salton Sea Unit V Ground Lease" means the
Ground Lease, dated as of September __, 1998, between
Imperial Magma and Salton Sea Power."
""Salton Sea Unit V O&M Agreement" means the
Unit 5 Operating and Maintenance Agreement, dated as of
September __, 1998, between CEOC and Salton Sea Power."
""Salton Sea Unit V Plant Connection Agreement"
means the Plant Connection Agreement for Salton Sea Unit
5, dated as of April 14, 1998, between IID and Salton Sea
Power."
""Salton Sea Unit V Power Sales Agreement"
means the Power Sales Agreement, dated as of September
__, 1998, between CalEnergy Minerals and Salton Sea
Power."
""Salton Sea Unit V Technology Transfer Agree
ment" means the Unit 5 Technology Transfer Agreement,
dated as of September __, 1998, between Magma and Salton
Sea Power."
""Salton Sea Unit V Transmission Service
Agreement" means the Transmission Service Agreement for
Power Generation Facilities, dated as of April 14, 1998,
between IID and Salton Sea Power."
""Salton Sea Unit V Waste Disposal Agreement"
means the Unit 5 Waste Disposal Agreement, dated as of
September __, 1998, between DVC and Salton Sea Power."
""Securities Account Control Agreement" means
the Securities Account Control Agreement, dated as of
September __, 1998, among the Funding Corporation, the
Guarantors, the Collateral Agent and the Depositary
Agent."
""Series F Final Offering Circular" means the
confidential offering circular of the Funding Corpora
tion, dated September __, 1998, with respect to the
Series F Securities."
""Series F Preliminary Offering Circular" means
the confidential preliminary offering circular of the
Funding Corporation, dated September __, 1998, with
respect to the Series F Securities."
""Series F Registration Rights Agreement" means
the Exchange and Registration Rights Agreement, dated as
of September __, 1998, between the Funding Corporation
and Credit Suisse First Boston Corporation, as initial
purchaser, for the benefit of the Holders of the Series F
Securities."
""Series F Securities" means the Securities
issued pursuant to the Fourth Supplemental Indenture,
dated as of September __, 1998, between the Funding
corporation and the Trustee, in the form of Exhibit A
thereto."
""Series F Yield Maintenance Premium" means an
amount calculated by the Funding Corporation or any
Guarantor as of the Redemption Date as follows:
(i) the average life of the
remaining scheduled payments of principal in
respect of outstanding Series F Securities (the
"Series F Remaining Average Life") shall be
calculated as of the Redemption Date;
(ii) the yield to maturity shall be
calculated for the United States Treasury
security having an average life equal to the
Series F Remaining Average Life and trading in
the secondary market at the price closest to
par (the "Primary Issue"); provided, however,
that if no United States Treasury security has
an average life equal to the Series F Remaining
Average Life, the yields (the "Other Yields")
for the two maturities of United States
Treasury securities having average lives most
closely corresponding to such Series F
Remaining Average Life and trading in the
secondary market at the price closest to par
shall be calculated, and the yield to maturity
for the Primary Issue shall be the yield
interpolated or extrapolated from such Other
Yields on a straight-line basis, rounding in
each of such relevant periods to the nearest
month;
(iii) the discounted present value
of the then remaining scheduled payments of
principal and interest (but excluding that
portion of any scheduled payment of interest
that is actually due and paid on the Redemption
Date) in respect of outstanding Series F
Securities shall be calculated as of the
Redemption Date using a discount factor equal
to the sum of (a) the yield to maturity for the
Primary Issue, plus (b) fifty (50) basis
points; and
(iv) the amount of Series F Yield
Maintenance Premium in respect of Series F
Securities to be redeemed shall be an amount
equal to (a) the discounted present value of
such Series F Securities to be redeemed
determined in accordance with clause (iii)
above minus (b) the unpaid principal amount of
such Series F Securities; provided, however,
that the Series F Yield Maintenance Premium
shall not be less than zero."
""Total Performance Liquidated Damages" has the
meaning set forth in Section [ ] of the Depositary
Agreement."
""Zinc Agreements" means, collectively, the
Zinc Technology Transfer Agreements, the Zinc EPC
Contract, the Zinc EPC Letter of Credit, the Zinc O&M
Agreement, the Zinc ASA, the Zinc Distribution Service
Agreement, the Zinc Dow Sales Agreement, the Zinc Water
Supply Agreement, the Zinc Processing Agreement, the Zinc
Ground Lease, the Zinc Easement, the Zinc Extraction
Agreement, the Zinc License Agreements [OTHERS] and any
Additional Project Document entered into by CalEnergy
Minerals with respect to the Zinc Project."
""Zinc ASA" means the Zinc Facility
Administrative Services Agreement, dated as of September
__, 1998, between Magma and CalEnergy Minerals."
""Zinc Construction Fund" means the fund of
such name created under the Depositary Agreement."
""Zinc Distribution Service Agreement" means
the Distribution Service Agreement, dated as of April 14,
1998, between IID and CalEnergy Minerals."
""Zinc Dow Sales Agreement" means the Dow Sales
Contract, dated as of September __, 1998, between Dow and
CalEnergy Minerals."
""Zinc Easement" means the Agreement Regarding
Easements and Subeasements, dated as of September __,
1998, among Magma, Imperial Magma and CalEnergy
Minerals."
""Zinc EPC Contract" means the Engineering,
Procurement and Construction Contract, dated as of
[________], 1998, between the Zinc EPC Contractor and
CalEnergy Minerals."
""Zinc EPC Contractor" means Kvaerner U.S.
Inc., a Delaware corporation."
""Zinc EPC Letter of Credit" means the Letter
of Credit, dated September __, 1998, issued by [________]
in favor of CalEnergy Minerals."
""Zinc Extraction Agreement" means the Grant of
Zinc Extraction Rights, dated as of September __, 1998,
among Magma, Magma Land, SSBP, Del Ranch, Elmore,
Leathers, Vulcan and CalEnergy Minerals."
""Zinc Ground Lease" means the Ground Lease,
dated as of September __, 1998, between Imperial Magma
and CalEnergy Minerals."
""Zinc License Agreements" means (i) the
License Agreement, dated as of April 28, 1997, between
BHP Minerals International, Inc. and [CalEnergy
Minerals], and (ii) the Resin Cleaning Patent/License
Agreement, dated as of September __, 1998, between
[________] and CalEnergy Minerals."
""Zinc O&M Agreement" means the Zinc Facility
Operating and Maintenance Agreement, dated as of
September __, 1998, between CEOC and CalEnergy Minerals."
""Zinc Processing Agreement" means the Zinc
Processing Agreement, dated as of September __, 1998,
among SSBP, Del Ranch, Elmore, Leathers, Vulcan and
CalEnergy Minerals."
""Zinc Project" means the 31,000 tons/year zinc
recovery facility 100% owned by CalEnergy Minerals,
located in the Salton Sea Known Geothermal Resource
Area."
""Zinc Technology Transfer Agreements" means
(i) the Zinc Facility/CalEnergy Technology Transfer
Agreement, dated as of September __, 1998, between
CalEnergy and CalEnergy Minerals, and (ii) the Zinc
Facility/Magma Power Technology Transfer Agreement, dated
as of September __, 1998, between Magma and CalEnergy
Minerals."
""Zinc Water Supply Agreement" means the Water
Supply Agreement, dated as of September __, 1998, between
IID and CalEnergy Minerals."
SECTION 4. Schedule I to Indenture. Schedule
I to the Indenture shall be supplemented by adding the
Amortization Schedule for the Series F Securities set
forth on Schedule I hereto to such Schedule I of the
Indenture.
SECTION 5. Effect of Supplemental Indenture.
Upon the execution of this Supplemental Indenture, the
Indenture shall be modified in accordance herewith, and
this Supplemental Indenture shall form a part of the
Indenture for all purposes; and every Holder of Securi
ties previously or thereafter authenticated and delivered
under the Indenture shall be bound by the terms hereof.
This Supplemental Indenture shall be construed as supple
mental to the Indenture and shall form a part thereof,
and the Indenture is hereby incorporated by reference
herein and hereby ratified, approved and confirmed. From
and after the date hereof, whenever referred to in any
Financing Document, the Indenture shall mean the Inden
ture as modified, amended and supplemented by this Sup
plemental Indenture.
SECTION 6. Headings for Convenience Only. The
descriptive headings in this Supplemental Indenture are
inserted for convenience only and shall not control or
affect the meaning or construction of any of the provi
sions hereof.
SECTION 7. Counterparts. This Supplemental
Indenture may be executed in any number of counterparts,
each of which when so executed and delivered shall be an
original; but such counterparts shall together constitute
but one and the same instrument.
SECTION 8. APPLICABLE LAW. THIS SUPPLEMENTAL
INDENTURE SHALL BE GOVERNED BY AND CONSTRUED IN ACCOR
DANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT
GIVING EFFECT TO THE PRINCIPLES OF CONFLICTS OF LAWS
(OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL
OBLIGATIONS LAW).
IN WITNESS WHEREOF, Salton Sea Funding Corporation has
caused this Supplemental Indenture to be executed and its
corporate seal to be hereunto affixed, attested by one of its
duly authorized officers and Chase Manhattan Bank and Trust
Company, National Association, has caused this Supplemental Inden
ture to be executed by one of its duly authorized officers, all
as of the day and year first above written.
[SEAL] SALTON SEA FUNDING CORPORATION,
as principal and as agent for the Guarantors
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
Attest:
Title: /s/ Steven A. McArthur
Steven A. McArthur
Executive Vice President
CHASE MANHATTAN BANK AND TRUST
COMPANY, NATIONAL ASSOCIATION,
as Trustee
By: /s/ Rose T. Maravilla
Name: Rose T. Maravilla
Title: Assistant Vice President
EXHIBIT 4.3(c)
SECOND AMENDED AND RESTATED
PARTNERSHIP SECURED LIMITED GUARANTEE
This Second Amended and Restated Partnership Secured
Limited Guarantee (this "Guarantee ") is entered into as of
October __, 1998 by CALENERGY OPERATING CORPORATION, a Delaware
corporation ("CEOC"), VULCAN POWER COMPANY, a Nevada corporation
("VPC"), CONEJO ENERGY COMPANY, a California corporation
("Conejo"), NIGUEL ENERGY COMPANY, a California corporation
("Niguel"), SAN FELIPE ENERGY COMPANY, a California corporation
("San Felipe"), BN GEOTHERMAL, INC., a Delaware corporation
("BNG"), DEL RANCH, L.P., a California limited partnership ("Del
Ranch"), ELMORE, L.P., a California limited partnership
("Elmore"), LEATHERS, L.P., a California limited partnership
("Leathers"), VULCAN/BN GEOTHERMAL POWER COMPANY, a Nevada
general partnership ("Vulcan"), CALENERGY MINERALS LLC, a
Delaware limited liability company ("Minerals LLC"), and CE TURBO
LLC, a Delaware limited liability company ("Turbo LLC," and
together with CEOC, VPC, Conejo, Niguel, San Felipe, BNG, Del
Ranch, Elmore, Leathers, Vulcan, and Minerals LLC, the
"Partnership Guarantors"), in favor of and for the benefit of
CHASE MANHATTAN BANK AND TRUST COMPANY, NATIONAL ASSOCIATION, a
national banking association organized under the laws of the
United States, as Trustee ("Trustee") under that certain Trust
Indenture dated as of July 21, 1995 by and between Salton Sea
Funding Corporation (the "Funding Corporation") and Trustee as
the same may be amended, modified or supplemented, including by
that certain First Supplemental Indenture dated as of October 18,
1995, that certain Second Supplemental Indenture dated as of June
20, 1996, that certain Third Supplemental Indenture dated as of
July 29, 1996, and that certain Fourth Supplemental Trust
Indenture dated as of even date herewith (as so amended, modified
or supplemented, the "Indenture") and as Collateral Agent
("Collateral Agent") under that certain Collateral Agency and
Intercreditor Agreement dated as of July 21, 1995 by and among
the Funding Corporation, the Guarantors and the Secured Parties
as the same may be amended, modified or supplemented, including
by that certain First Amendment to the Collateral Agency and
Intercreditor Agreement dated as of June 20, 1996 and that
certain Second Amendment to the Collateral Agency and
Intercreditor Agreement dated as of date even herewith for the
benefit of the Secured Parties and the Funding Corporation (as so
amended, modified or supplemented, the "Intercreditor
Agreement"). All capitalized terms used herein but not
specifically defined shall have the respective meanings given to
such terms in Exhibit A to the Indenture, which Exhibit A is
hereby incorporated by reference as if set forth in full herein.
W I T N E S S E T H:
WHEREAS, the Funding Corporation is a corporation
established for the sole purpose of making loans to the
Guarantors from proceeds of the issuance of notes and bonds
(collectively, the "Securities") in its individual capacity as
principal and as agent acting on behalf of the Guarantors
pursuant to the Indenture; and
WHEREAS, the principal and interest payments on the
Securities will be serviced by repayment of loans made by the
Funding Corporation to the Guarantors and guaranteed by the
Guarantors, subject to the conditions set forth in the Indenture;
and
WHEREAS, on July 21, 1995 the Funding Corporation
issued and sold Securities in the aggregate principal amount of
$475,000,000.00 (the "Initial Securities"); and
WHEREAS, the Funding Corporation used a portion of the
proceeds from the sale of the Initial Securities to make a loan
to CEOC and VPC in the aggregate amount of $75,000,000.00
pursuant to that certain Credit Agreement (Partnership
Guarantors) dated as of June 21, 1995; and
WHEREAS, in connection with the making of such loan to
CEOC and VPC, CEOC and VPC entered into the Partnership Secured
Limited Guarantee dated as of July 21, 1995 in favor of the
Trustee (the "Original Secured Limited Guarantee") whereby CEOC
and VPC guaranteed certain of the obligations of the Funding
Corporation under the Initial Securities; and
WHEREAS, on June 20, 1996 the Funding Corporation
issued and sold Securities in the aggregate principal amount of
$135,000,000.00 (the "Supplemental Securities); and
WHEREAS, the Funding Corporation used the proceeds from
the sale of the Supplemental Securities to make a loan to CEOC,
VPC, BNG, Conejo, Del Ranch, Elmore, Leathers, Niguel, San
Felipe, and Vulcan pursuant to that certain Amended and Restated
Credit Agreement (Partnership Guarantors) dated as of June 20,
1996; and
WHEREAS, in connection with the making of such loan to
CEOC, VPC, BNG, Conejo, Del Ranch, Elmore, Leathers, Niguel, San
Felipe, and Vulcan, such parties entered into the Amended and
Restated Partnership Secured Limited Guarantee dated as of June
20,1996 in favor of the Trustee (the "Supplemental Secured
Limited Guarantee") whereby such parties agreed to amend and
restate the Original Secured Limited Guarantee and guaranteed
certain of the obligations of the Funding Corporation under the
Initial Securities and the Supplemental Securities (the Original
Secured Limited Guarantee as so amended the "Existing Partnership
Guarantee"); and
WHEREAS, the Funding Corporation has simultaneously
with the execution and delivery of this Guarantee issued and sold
Securities in the aggregate principal amount of $285,000,000 (the
"New Securities") a portion of the net proceeds of which will be
loaned to the Partnership Guarantors pursuant to that certain
Second Amended and Restated Credit Agreement (Partnership
Guarantors) dated as of even date herewith (the "Partnership
Credit Agreement"); and
WHEREAS, each Partnership Guarantor is an affiliate of
the Funding Corporation and anticipates benefiting directly and
indirectly from the issuance and sale of the New Securities by
the Funding Corporation and continuing to benefit from the
issuance and sale of the Initial Securities and the Supplemental
Securities by the Funding Corporation, and each Partnership
Guarantor (including Minerals LLC and Turbo LLC) has therefore
agreed to jointly and severally guarantee certain of the
obligations of the Funding Corporation under the Securities
(including the Initial Securities and the Supplemental
Securities) in accordance with the terms hereof; and
WHEREAS, in order to evidence and implement such
guarantee by all of the Partnership Guarantors and the joint and
several obligations of all of the Partnership Guarantors
thereunder, the parties hereto have agreed to amend and restate
the Existing Partnership Guarantee as set forth herein.
In consideration of the above premises and for other
good and valuable consideration, the receipt and adequacy of
which are hereby acknowledged, the parties hereto hereby agree as
follows:
AGREEMENT
1. From and after the date hereof, the terms of the
Existing Partnership Guarantee shall be amended and restated to
read in their entirety as set forth herein and the terms hereof
shall govern and control the rights and obligations of the
parties in and with respect to the matters set forth herein,
notwithstanding any conflict between the terms hereof and the
terms of the Existing Partnership Guarantee. The Existing
Partnership Guarantee is hereby amended and restated in its
entirety as follows.
2. As set forth in this Guarantee, each Partnership
Guarantor jointly and severally guarantees the payment of the
Indebtedness (as hereafter defined) when due, upon maturity,
acceleration or otherwise; provided, however, that no obligation
to pay all or any portion of the Indebtedness shall exist unless
there also shall have occurred and be continuing (a) an Event of
Default under the Partnership Credit Agreement, (b) an Event of
Default under Section 6.1(a) of the Indenture or (c) an Event of
Default under Section 18 of this Guarantee; and provided further
that each Partnership Guarantor's obligation hereunder shall be
limited to the Available Cash Flow of such Partnership Guarantor.
3. "Indebtedness" as used herein shall mean all
principal, interest, premium (if any), fees, charges, penalties,
expenses, payments, and all other amounts due with respect to the
Securities and all other Senior Debt.
4. Subject to the conditions set forth in Section 2
of this Guarantee, the liability of each Partnership Guarantor
under this Guarantee in respect of the Indebtedness shall be
absolute and unconditional, and shall not be affected or released
in any way, irrespective of:
(a) any lack of validity or enforceability of the
Securities, the Indenture, the Credit Agreements or any of the
other Transaction Documents;
(b) any change in the time, manner or place of
payment of, or in any other term of, all or any of the
Indebtedness or amendment or waiver of, or any consent to any
departure from, any Transaction Document, including, without
limitation, any increase in the Indebtedness or other obligations
of the Funding Corporation under the Indenture;
(c) any enforcement of any Transaction Document,
including the taking, holding or sale of any collateral, or any
termination or release of any collateral from the liens created
by any Transaction Document or the non-perfection of any liens
created by any Transaction Document;
(d) the failure by any one of the Partnership
Guarantors to fulfill its obligations under this Guarantee;
(e) any change, restructuring or termination of
the corporate structure or existence of the Funding Corporation;
or
(f) any Event of Default of the Funding
Corporation under Sections 6.1(f) or (g) of the Indenture, of the
Salton Sea Guarantors under Section 5.1(e) of the Salton Sea
Credit Agreement, of the Partnership Guarantors under Section
5.1(e) of the Partnership Credit Agreement or of the Royalty
Guarantor under Section 5.1(e) of the Royalty Credit Agreement.
This Guarantee shall continue to be effective or be
reinstated, as the case may be, if at any time any payment of any
of the Indebtedness is rescinded or must otherwise be returned by
the Trustee or any other Person upon the insolvency, bankruptcy
or reorganization of the Funding Corporation or the Partnership
Guarantors, or otherwise, all as though such payment had not been
made.
5. Except to the extent provided in Section 2 of this
Guarantee, the obligations hereunder are independent of the
obligations of the Funding Corporation or any other Guarantor,
and a separate action or actions may be brought and prosecuted
against any of the Partnership Guarantors whether action is
brought against either the Funding Corporation or any other
Guarantor or whether either the Funding Corporation or any other
Guarantor be joined in any such action or actions; and each
Partnership Guarantor waives the benefit of any statute of
limitations affecting its liability hereunder.
6. The Partnership Guarantors authorize the Trustee,
acting pursuant to the Indenture, without notice or demand and
without affecting their liability hereunder, from time to time,
whether before or after termination of this Guarantee, to (a)
renew, compromise, extend, accelerate or otherwise change the
time for payment of the obligations of the Funding Corporation
under the Indenture or any part thereof; (b) take and hold
security for the payment of this Guarantee or the Indebtedness,
and exchange, enforce, waive, release, fail to perfect, sell, or
otherwise dispose of any such security; (c) apply such security
and direct the order or manner of sale thereof; and (d) release
or substitute any one or more of the endorsers or guarantors.
7. The Partnership Guarantors hereby waive and
relinquish all rights and remedies accorded by applicable law to
sureties or guarantors and agree not to assert or take advantage
of any such rights or remedies, including without limitation:
Civil Code Section 2856(c) Waiver
(a) all rights and defenses that the Partnership
Guarantors may have because the obligations of the Funding
Corporation or any other guarantor of any or all of the
Indebtedness are secured by real property. This means, among
other things:
(1) Trustee may collect from the Partnership
Guarantors without first foreclosing on any real or personal
property collateral pledged by the Funding Corporation or any
other guarantor;
(2) If Trustee forecloses on any real
property collateral pledged by the Funding Corporation or any
other guarantor:
(A) the amount of the debt may be
reduced only by the price for which that collateral is sold at
the foreclosure sale, even if the collateral is worth more
than the sale price; and
(B) Trustee may collect from the
Partnership Guarantors even if Trustee, by foreclosing on the
real property collateral, has destroyed any right the
Partnership Guarantors may have to collect from the Funding
Corporation or any other guarantor.
This is an unconditional and irrevocable waiver of
any rights and defenses the Partnership Guarantors may have
because the Indebtedness is secured by real property. These
rights and defenses include, but are not limited to, any
rights or defenses based upon Section 580a, 580b, 580d or 726
of the California Code of Civil Procedure.
Civil Code Section 2856(d) Waiver
(b) all rights and defenses arising out of an
election of remedies by Trustee, even though that election of
remedies such as a nonjudicial foreclosure with respect to
security for a guaranteed obligation has destroyed the
Partnership Guarantors' right of subrogation and reimbursement
against the principal by the operation of Section 580d of the
Code of Civil Procedure or otherwise;
Other Waivers
(c) The Partnership Guarantors hereby waive, to
the extent permitted by applicable law: (i) promptness,
diligence, notice of acceptance and any other notice with respect
to any of the Indebtedness or any other obligations under the
Transaction Documents or this Guarantee; (ii) any requirement
that the Trustee or any other Person protect, secure or insure
any lien or any collateral or other property subject thereto or
exhaust any right or take any action against either the Funding
Corporation or any other Person or any collateral; (iii) any
defense arising by reason of any claim or defense based upon an
election of remedies by the Trustee which in any manner impairs,
reduces, releases or otherwise adversely affects its subrogation,
contribution or reimbursement rights or other rights to proceed
against either the Funding Corporation or any other Person or any
collateral; (iv) any duty on the part of the Trustee to disclose
to the Partnership Guarantors any matter, fact or thing relating
to the business, operation or condition of either the Funding
Corporation or any other party to any of the Transaction
Documents and the Funding Corporation's assets now known or
hereafter known by the Trustee; and (v) all presentments, demands
for performance, notices of nonperformance, protests, notices of
protest, notices of dishonor, and notices of acceptance of this
Guarantee and of the existence, creation, or incurrence of new or
additional Indebtedness.
8. The Partnership Guarantors hereby irrevocably
waive any claim or other rights which they may now or hereafter
acquire against either the Funding Corporation or any other
guarantor of any or all of the Indebtedness, whether due or to
become due, voluntary or involuntary, absolute or contingent,
liquidated or unliquidated, determined or undetermined,
including, without limitation, any right of subrogation,
reimbursement, exoneration, contribution, or indemnification; or
any right to participate in any claim or remedy of the Trustee
against either the Funding Corporation or any such guarantor or
any collateral which the Trustee now has or hereafter acquires,
whether or not such claim, remedy or right arises in equity, or
under contract, statute or common law, including without
limitation, the right to take or receive from the Funding
Corporation, directly or indirectly, in cash or other property or
by set-off or in any other manner, payment or security on account
of such claim or other rights; and the rights and defenses
available to Partnership Guarantors by reason of California Civil
Code Sections 2787 to 2855, inclusive; and any and all benefits
which might otherwise be available to the Partnership Guarantors
under California Civil Code Sections 2809, 2810, 2819, 2839, 2845
through 2847, 2849, 2850, 2899 and 3433. If any amount shall be
paid to the Partnership Guarantors in violation of the preceding
sentence and the Indebtedness shall not have been paid in full,
such amount shall be deemed to have been paid to the Partnership
Guarantors for the benefit of, and held in trust for the benefit
of, the Trustee and shall forthwith be paid to the Trustee to be
credited and applied to the Indebtedness, whether matured or
unmatured, in accordance with the terms of the Indenture. The
Partnership Guarantors acknowledge that they have received and
will receive direct and indirect benefits from the sales of the
Securities already completed and the sales of Securities
currently contemplated by the Indenture and that the waiver set
forth in this Section 8 is knowingly made in contemplation of
such benefits.
9. The Partnership Guarantors agree that, to the
extent that either the Funding Corporation or any of the
Partnership Guarantors makes a payment or payments to the
Trustee, or the Trustee receives any proceeds of collateral,
which payment or payments or any part thereof are subsequently
invalidated, declared to be fraudulent or preferential, set aside
or otherwise required to be repaid to either the Funding
Corporation, its estate, trustee, receiver or any other party,
including, without limitation, under any bankruptcy law, state or
federal law, common law or equitable cause, then to the extent of
such payment or repayment, the obligation or part thereof which
has been paid, reduced or satisfied by such amount shall be
reinstated and continued in full force and effect as of the date
such initial payment, reduction or satisfaction occurred. The
Partnership Guarantors shall defend and indemnify the Trustee
from and against any claim or loss under this Section 9
(including reasonable attorneys' fees and expenses) in the
defense of any such action or suit.
10. The Partnership Guarantors acknowledge and agree
that they shall have the sole responsibility for obtaining from
the Funding Corporation such information concerning the Funding
Corporation's financial conditions or business operations as the
Partnership Guarantors may require, and that the Trustee has no
duty at any time to disclose to the Partnership Guarantors any
information relating to the business operations or financial
condition of the Funding Corporation.
11. To the extent that any of the waivers set forth in
Sections 7 and 8 is or is deemed to be ineffective or
inapplicable, any obligations of the Funding Corporation to the
Partnership Guarantors, now or hereafter existing, are hereby
subordinated to the Indebtedness. If the Trustee so requests,
after the occurrence of an Event of Default under the Indenture,
such obligations of the Funding Corporation to the Partnership
Guarantors shall be enforced and performance received by the
Partnership Guarantors as trustee for the Trustee and the
proceeds thereof shall be paid over to the Trustee on account of
the Indebtedness, but without reducing or affecting in any manner
the maximum liability of the Partnership Guarantors under the
other provisions of this Guarantee.
12. The Trustee may, without notice to the Partnership
Guarantors and without affecting the Partnership Guarantors'
obligations hereunder, assign this Guarantee, in whole or in part
in accordance with the provisions of the Indenture. The
Partnership Guarantors agree that the Trustee may, subject to the
provisions of the Indenture, disclose to any prospective
purchaser and any purchaser of all or part of the Indebtedness
any and all information in the Trustee's possession concerning
the Partnership Guarantors, this Guarantee and any security for
this Guarantee.
13. The Partnership Guarantors agree to pay all
reasonable attorneys' fees and all other fees and expenses which
may be incurred by the Trustee in the enforcement of this
Guarantee.
14. The Trustee agrees that no directors, officers,
shareholders (other than CEOC, VPC, Conejo, Niguel, San Felipe
and BNG) or employees of any Partnership Guarantor shall in any
way be liable for the payment of the Securities, the Project
Notes or any sums now or hereafter owing under the terms of, or
for the performance of any obligation contained in, this
Guarantee.
15. This Guarantee shall be governed by and construed
according to the laws of the State of California.
16. This Guarantee embodies the entire agreement and
understanding between the parties hereto and supersedes all prior
agreements and understandings relating to the subject matter
hereof.
17. This Guarantee may be executed in any number of
counterparts, all of which together shall constitute one
agreement.
18. The Partnership Guarantors shall continue to be
bound by and perform all of their obligations under the terms and
conditions set forth in the Partnership Credit Agreement for the
benefit of the Funding Corporation and its legal successors and
assigns, the terms of which are incorporated herein by reference
as if set forth in full herein, from and after the date that the
Partnership Project Note is repaid and until the payment in full
of all obligations under the Salton Sea Project Note and the
Royalty Project Note. The Partnership Guarantors' failure to
perform such terms and conditions shall, from and after the date
that the Partnership Project Note has been repaid, be an Event of
Default hereunder.
19. The obligations hereunder are subject to the
limitations set forth in Section 6.11 of the Partnership Credit
Agreement, the provisions of which are hereby incorporated by
reference.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
The Partnership Guarantors have executed this Guarantee
as of the date and year first written above.
VULCAN POWER COMPANY,
a Nevada corporation
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
CALIFORNIA ENERGY OPERATING CORPORATION,
a Delaware corporation
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
CONEJO ENERGY COMPANY,
a California corporation
By:/s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
NIGUEL ENERGY COMPANY,
a California corporation
By:/s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
SAN FELIPE ENERGY COMPANY,
a California corporation
By:/s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
BN GEOTHERMAL INC.,
a Delaware corporation
By:/s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
DEL RANCH, L.P.,
a California limited partnership
By: CalEnergy Operating Corporation,
a Delaware corporation, its general partner
By:/s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
ELMORE, L.P.,
a California limited partnership
By: CalEnergy Operating Corporation,
a Delaware corporation, its general partner
By:/s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
LEATHERS, L.P.,
a California limited partnership
By: CalEnergy Operating Corporation,
a Delaware corporation, its general partner
By:/s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
VULCAN/BN GEOTHERMAL POWER COMPANY,
a Nevada general partnership
By: Vulcan Power Company,
a Nevada corporation, its partner
By:/s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
CALENERGY MINERALS LLC,
a Delaware limited liability company
By: Salton Sea Minerals Corp.,
a Delaware corporation, its manager
By:/s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
CE TURBO LLC,
a Delaware limited liability company
By: Magma Power Company,
a Nevada corporation, its manager
By:/s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
EXHIBIT 4.6(c)
1 SECOND AMENDMENT TO
COLLATERAL AGENCY AND INTERCREDITOR AGREEMENT
SECOND AMENDMENT, dated as of October __, 1998
(this "Amendment"), to the COLLATERAL AGENCY AND
INTERCREDITOR AGREEMENT, dated as of July 21, 1995 (as
amended by the First Amendment to Collateral Agency and
Intercreditor Agreement, dated as of June 20, 1996, the
"Intercreditor Agreement"), among SALTON SEA FUNDING
CORPORATION, a Delaware corporation (together with its
successors and assigns, the "Funding Corporation"), the
SALTON SEA GUARANTORS (as defined in the Indenture re
ferred to below), the PARTNERSHIP GUARANTORS (as defined
in the Indenture referred to below), the ROYALTY GUARAN
TOR (as defined in the Indenture referred to below), the
DEBT SERVICE RESERVE LOC PROVIDER (as defined in the
Intercreditor Agreement), the WORKING CAPITAL AGENT (as
defined in the Intercreditor Agreement), the PERMITTED
COUNTERPARTY under any Interest Rate Protection Agreement
(each as defined in the Indenture referred to below), the
TRUSTEE (as defined in the Intercreditor Agreement), the
DEPOSITARY AGENT (as defined in the Intercreditor Agree
ment) and the COLLATERAL AGENT (as defined in the
Intercreditor Agreement). Capitalized terms used but not
otherwise defined herein shall have the meanings assigned
to such terms in the Intercreditor Agreement.
WHEREAS, the Funding Corporation, certain of
the Salton Sea Guarantors, certain of the Partnership
Guarantors, the Royalty Guarantor, the Debt Service
Reserve LOC Provider, the Working Capital Agent, the
Trustee, the Depositary Agent and the Collateral Agent
have entered into the Intercreditor Agreement;
WHEREAS, the Funding Corporation has issued
Securities under the Trust Indenture, dated as of July
21, 1995 (as supplemented and amended by the First Sup
plemental Indenture dated as of October 18, 1995, the
Second Supplemental Indenture dated as of June 20, 1996
and the Third Supplemental Indenture dated as of July 29,
1996), between the Funding Corporation, as principal and
as agent for the Guarantors, and the Trustee (the "Trust
Indenture");
WHEREAS, the Funding Corporation has determined
to issue $285,000,000 principal amount of [__]% Senior
Secured Series F Bonds Due 2018 (the "Series F
Securities") pursuant to the Fourth Supplemental Inden
ture, dated as of October __, 1998 (the "Fourth Supple
mental Indenture"), between the Funding Corporation, as
principal and as agent for the Guarantors, and the Trust
ee (the Trust Indenture, as so supplemented and as
otherwise amended, modified or supplemented from time to
time, the "Indenture");
WHEREAS, in connection with the issuance of the
Series F Securities, additional parties are becoming
Partnership Guarantors under the Indenture and related
documents, and additional parties are becoming obligors
under the Partnership Credit Agreement;
WHEREAS, in connection with the issuance of the
Series F Securities, an additional party is becoming a
Salton Sea Guarantor under the Indenture and related
documents, and an additional party is becoming an obligor
under the Salton Sea Credit Agreement; and
WHEREAS, the terms of the Intercreditor Agree
ment must be amended to reflect the additional Partner
ship Guarantors and Salton Sea Guarantor and additional
obligors under the Partnership Credit Agreement and
Salton Sea Credit Agreement and to effect other changes
in connection with the issuance by the Funding
Corporation of the Series F Securities.
NOW, THEREFORE, in consideration of the premis
es and for other good and valuable consideration, the
receipt of which is hereby acknowledged, the parties
hereby agree as follows.
1. Amendment of the Intercreditor Agreement.
As of the date hereof, the Intercreditor Agreement shall
be amended as follows:
(a) Section 9(a) is hereby amended by deleting
the name "Chemical Trust Company of California" and
replacing it with the name "Chase Manhattan Bank and
Trust Company, National Association," in the first
sentence thereof.
(b) Section 9(b) is hereby amended by deleting
the name "Chemical Trust Company of California" and
replacing it with the name "Chase Manhattan Bank and
Trust Company, National Association," in the first
sentence thereof.
(c) Section 18 is hereby amended by:
(i) deleting the name, address and
contact information for the Debt Service
Reserve LOC Provider and replacing it with the
following name, address and contact
information:
"Credit Suisse First Boston
Eleven Madison Avenue
New York, NY 10010
Attention: [________]
Telecopy: 212-325-[____]";
(ii) deleting the name, address and
contact information for the Working Capital
Agent and replacing it with the following name,
address and contact information:
"Credit Suisse First Boston
Eleven Madison Avenue
New York, NY 10010
Attention: [________]
Telecopy: 212-325-[____]";
(iii) deleting the name, notice
address and contact information for the Trustee
and replacing it with the following name,
notice address and contact information:
"Chase Manhattan Bank and Trust Company,
National Association
101 California Street, #2725
San Francisco, CA 94111
Attention: Corporate Trust Administration
Telecopy: 415-693-8850";
(iv) adding the following name above
the notice address for the Salton Sea
Guarantors:
"Salton Sea Power L.L.C.";
(v) adding the following names above
the notice address for Partnership Guarantors:
"CalEnergy Minerals LLC
CE Turbo LLC";
(vi) deleting the name "California
Energy Operating Company" above the notice
address for the Partnership Guarantors and
replacing it with the name "CalEnergy Operating
Corporation";
(vii) deleting the name, notice
address and contact information for the
Depositary Agent and replacing it with the
following name, notice address and contact
information:
"Chase Manhattan Bank and Trust Company,
National Association
101 California Street, #2725
San Francisco, CA 94111
Attention: Corporate Trust Administration
Telecopy: 415-693-8850"; and
(viii) deleting the name, notice
address and contact information for the
Collateral Agent and replacing it with the
following name, notice address and contact
information:
"Chase Manhattan Bank and Trust Company,
National Association
101 California Street, #2725
San Francisco, CA 94111
Attention: Corporate Trust Administration
Telecopy: 415-693-8850".
(d) Schedule 8(a) to the Intercreditor
Agreement is hereby amended (i) by adding the phrase "and
as of October __, 1998" after the phrase "as of June 20,
1996" in the first sentence thereof, (ii) by deleting the
words "and by" after the phrase "as of October 18, 1995,"
in the second sentence thereof, (iii) by adding the word
"Second" before the phrase "Supplemental Indenture dated
as of June 20, 1996" in the second sentence thereof, (iv)
by adding the phrase ", the Third Supplemental Indenture
dated as of July 29, 1996 and the Fourth Supplemental
Indenture dated as of October __, 1998" after the phrase
"as of June 20, 1996" in the second sentence thereof and
(v) by deleting the name "Chemical Trust Company of
California" and replacing it with the name "Chase
Manhattan Bank and Trust Company, National Association"
in the second sentence thereof.
(e) Schedule 9a to the Intercreditor
Agreement is hereby amended by adding the phrase "and as
of October __, 1998" after the phrase "as of June 20,
1996" in the first paragraph thereof.
(f) Schedule 14a to the Intercreditor
Agreement is hereby amended by adding the phrase "and as
of October __, 1998" after the phrase "as of June 20,
1996" in the first paragraph thereof.
(g) The Certificate of Salton Sea Funding
Corporation, appearing directly after Schedule 14a to the
Intercreditor Agreement, is hereby amended by (i) by
deleting the words "and by" after the phrase "as of
October 18, 1995," in the first paragraph thereof, (ii)
by adding the word "Second" before the phrase
"Supplemental Indenture dated as of June 20, 1996" in the
first paragraph thereof, (iii) by adding the phrase ",
the Third Supplemental Indenture dated as of July 29,
1996 and the Fourth Supplemental Indenture dated as of
October __, 1998" after the phrase "as of June 20, 1996"
in the third paragraph thereof and (iv) by deleting the
name "Chemical Trust Company of California" and replacing
it with the name "Chase Manhattan Bank and Trust Company,
National Association" in the first paragraph thereof.
2. Additional Guarantors. In accordance with
the terms of the Fourth Supplemental Indenture, from and
after the date hereof (a) Salton Sea Power L.L.C. ("Power
LLC") shall be a "Salton Sea Guarantor" under the
Intercreditor Agreement, as amended hereby (as so
amended, the "Amended Intercreditor Agreement") and (b)
each of CalEnergy Minerals LLC ("Minerals LLC") and CE
Turbo LLC ("Turbo LLC" and, together with Power LLC and
Minerals LLC, the "New Guarantors") shall be "Partnership
Guarantors" under the Amended Intercreditor Agreement.
Each New Guarantor hereby acknowledges and agrees to the
terms of the Amended Intercreditor Agreement and consents
to the exercise of remedies by the Collateral Agent con
tained therein.
3. Intercreditor Agreement. Except as specif
ically amended hereby, the Intercreditor Agreement shall
continue in full force and effect in accordance with the
provisions thereof as in existence on the date hereof.
All references to "this Intercreditor Agreement" in the
Intercreditor Agreement shall be deemed to refer to the
Amended Intercreditor Agreement.
4. Governing Law. THIS AMENDMENT SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS
OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO PRIN
CIPLES THEREOF RELATING TO CONFLICTS OF LAW (EXCEPT SEC
TION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW).
5. Counterparts. This Amendment may be exe
cuted in any number of counterparts and by different
parties hereto in separate counterparts, each of which
when so executed and delivered shall be deemed an origi
nal, but all such counterparts together shall constitute
but one and the same instrument.
IN WITNESS WHEREOF, the undersigned have caused this
Amendment to be duly executed by their duly authorized officers,
all as of the date first written above.
SALTON SEA FUNDING CORPORATION
By:/s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
SALTON SEA POWER GENERATION L.P.
By: SALTON SEA POWER COMPANY,
as its general partner
By:/s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
SALTON SEA BRINE PROCESSING L.P.
By: SALTON SEA POWER COMPANY,
as its general partner
By:/s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
FISH LAKE POWER COMPANY
By:/s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
SALTON SEA POWER L.L.C.
By: CE SALTON SEA INC.,
as its manager
By:/s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
VULCAN POWER COMPANY
By:/s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
CALENERGY OPERATING CORPORATION
By:/s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
BN GEOTHERMAL INC.
By:/s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
VULCAN/BN GEOTHERMAL POWER COMPANY
By: VULCAN POWER COMPANY,
as its general partner
By:/s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
SAN FELIPE ENERGY COMPANY
By:/s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
LEATHERS, L.P.
By: CALENERGY OPERATING CORPORATION, as
its general partner
By:/s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
CONEJO ENERGY COMPANY
By:/s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
DEL RANCH, L.P.
By: CALENERGY OPERATING CORPORATION, as
its general partner
By:/s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
NIGUEL ENERGY COMPANY
By:/s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
ELMORE, L.P.
By: CALENERGY OPERATING CORPORATION, as
its general partner
By:/s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
CALENERGY MINERALS LLC
By: SALTON SEA MINERALS CORP.,
as its manager
By:/s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
CE TURBO LLC
By: MAGMA POWER COMPANY,
as its manager
By:/s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
SALTON SEA ROYALTY COMPANY
By:/s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
CREDIT SUISSE FIRST BOSTON,
as the Debt Service Reserve LOC Provider
By:/s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
CREDIT SUISSE FIRST BOSTON,
as the Working Capital Agent
By:/s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
CHASE MANHATTAN BANK AND TRUST COMPANY,
NATIONAL ASSOCIATION,
as the Trustee
By:/s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
CHASE MANHATTAN BANK AND TRUST COMPANY,
NATIONAL ASSOCIATION,
as the Depositary Agent
By:/s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
CHASE MANHATTAN BANK AND TRUST COMPANY,
NATIONAL ASSOCIATION,
as the Collateral Agent
By:/s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
EXHIBIT 4.8(c)
$285,000,000
SALTON SEA FUNDING CORPORATION
7.475% Senior Secured Series F Bonds Due November 30, 2018
PURCHASE AGREEMENT
October 7, 1998
Credit Suisse First Boston Corporation
Goldman, Sachs & Co.
c/o Credit Suisse First Boston Corporation
Eleven Madison Avenue
New York, New York 10010-3629
Dear Sirs:
1. Introductory. Salton Sea Funding Corporation, a
Delaware corporation (the ?Funding Corporation"), proposes,
subject to the terms and conditions stated herein, to issue
and sell to the several initial purchasers named in Schedule
I hereto (the "Purchasers"), U.S.$285,000,000 principal
amount of its 7.475% Senior Secured Series F Bonds Due
November 30, 2018 (the "Securities"), to be issued under a
Trust Indenture dated as of July 21, 1995, as supplemented
by the First Supplemental Indenture dated as of October 18,
1995, the Second Supplemental Indenture dated as of June 20,
1996, the Third Supplemental Indenture dated as of July 29,
1996 and the Fourth Supplemental Indenture to be dated as of
the Closing Date (as hereinafter defined) (as so supplement
ed, the ?Indenture?), each by and between the Funding
Corporation and Chase Manhattan Bank and Trust Company,
National Association, as trustee (the "Trustee"), on a
private placement basis pursuant to an exemption under
Section 4(2) of the United States Securities Act of 1933, as
amended (the "Securities Act"). Payments owed under the
Securities will be guaranteed by Salton Sea Brine Processing
L.P., a California limited partnership ("SSBP"), Salton Sea
Power Generation L.P., a California limited partnership
("SSPG"), Fish Lake Power Company, a Delaware corporation
("Fish Lake"), Salton Sea Power L.L.C., a Delaware limited
liability company ("Power LLC" and, collectively with SSBP,
SSPG and Fish Lake, the "Salton Sea Guarantors"), Vulcan
Power Company, a Delaware corporation ("VPC"), CalEnergy
Operating Corporation, a Delaware corporation ("CEOC"), BN
Geothermal, Inc., a Delaware corporation ("BN/Geothermal"),
San Felipe Energy Company, a California corporation ("San
Felipe"), Conejo Energy Company, a California corporation
("Conejo"), Niguel Energy Company, a California corporation
("Niguel"), Vulcan/BN Geothermal Power Company, a Nevada
general partnership ("Vulcan"), Leathers, L.P., a California
limited partnership ("Leathers"), Elmore, L.P., a California
limited partnership ("Elmore"), Del Ranch, L.P., a
California limited partnership ("Del Ranch"), CalEnergy
Minerals LLC, a Delaware limited liability company
("Minerals LLC"), CE Turbo LLC, a Delaware limited liability
company ("Turbo LLC" and, collectively with VPC, CEOC,
BN/Geothermal, San Felipe, Conejo, Niguel, Vulcan, Leathers,
Elmore, Del Ranch and Minerals LLC, the "Partnership
Guarantors") and Salton Sea Royalty Company, a Delaware
corporation ("SSRC" or the "Royalty Guarantor" and, collec
tively with the Salton Sea Guarantors and the Partnership
Guarantors, the "Guarantors"). Capitalized terms used
herein without being defined herein shall have the meanings
ascribed to such terms in the Indenture (as modified by the
form of Fourth Supplemental Indenture attached as Annex A
hereto). Each of the Funding Corporation and the Guarantors
hereby agrees with the Purchaser as follows:
2. Representations and Warranties of the Funding
Corporation and the Guarantors.
Each of the Funding Corporation and the Guarantors
jointly and severally represents and warrants to, and agrees
with, the Purchasers that:
(a) The Funding Corporation and the Guarantors
have prepared a preliminary offering circular dated
September 28, 1998 (as it may be amended or supplemented,
and together with the letter dated September 28, 1998
included therewith, the "Preliminary Offering Circular") and
a final offering circular dated October 7, 1998 (as it may
be amended or supplemented, the "Offering Circular") relat
ing to the Securities. Copies of the Preliminary Offering
Circular and the Offering Circular have been delivered by
the Funding Corporation and the Guarantors to the
Purchasers. The Preliminary Offering Circular was on the
date thereof accurate in all material respects and did not
contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or
necessary to make the statements therein, in the light of
the circumstances under which they were made, not
misleading; and the Offering Circular is as of its date (and
any amendment or supplement thereto will be as of its date)
accurate in all material respects and does not (and will
not) contain any untrue statement of a material fact or omit
to state any material fact necessary to make the statements
therein, in the light of the circumstances under which they
were made, not misleading; provided that the Funding
Corporation and the Guarantors make no representation or
warranty as to information contained in or omitted from the
Preliminary Offering Circular or the Offering Circular in
reliance upon and in conformity with written information
furnished to the Funding Corporation by any Purchaser
through Credit Suisse First Boston Corporation ("CSFBC")
specifically for inclusion therein, it being understood and
agreed that the only such information is that described as
such in Section 7(b) hereof.
(b) The Funding Corporation has been duly
incorporated and is validly existing as a corporation in
good standing under the laws of the State of Delaware, and
is duly qualified to do business as a foreign corporation,
and is a corporation in good standing, in each jurisdiction
in which its ownership or lease of property or the conduct
of its business requires such qualification (except where
the failure to so qualify would not have a material adverse
effect on the Funding Corporation and the Guarantors, taken
as a whole). Each of SSBP, SSPG, Leathers, Elmore and Del
Ranch is a limited partnership duly formed and validly
existing in good standing under the laws of the State of
California, and is duly qualified to do business as a
foreign limited partnership, and is a foreign limited
partnership in good standing, in each jurisdiction in which
its ownership or lease of property or the conduct of its
business requires such qualification (except where the
failure to so qualify would not have a material adverse
effect on the Funding Corporation and the Guarantors, taken
as a whole). Each of CEOC, Fish Lake, SSRC and
BN/Geothermal has been duly incorporated and is validly
existing as a corporation in good standing under the laws of
the State of Delaware, and is duly qualified to do business
as a foreign corporation, and is a corporation in good
standing, in each jurisdiction in which its ownership or
lease of property or the conduct of its business requires
such qualification (except where the failure to so qualify
would not have a material adverse effect on the Funding
Corporation and the Guarantors, taken as a whole). VPC has
been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of
Nevada, and is duly qualified to do business as a foreign
corporation, and is a corporation in good standing, in each
jurisdiction in which its ownership or lease of property or
the conduct of its business requires such qualification
(except where the failure to so qualify would not have a
material adverse effect on the Funding Corporation and the
Guarantors, taken as a whole). Each of San Felipe, Conejo
and Niguel has been duly incorporated and is validly
existing as a corporation in good standing under the laws of
the State of California, and is duly qualified to do
business as a foreign corporation, and is a corporation in
good standing, in each jurisdiction in which its ownership
or lease of property or the conduct of its business requires
such qualification (except where the failure to so qualify
would not have a material adverse effect on the Funding
Corporation and the Guarantors, taken as a whole). Vulcan
is a general partnership duly formed and validly existing in
good standing under the laws of the State of Nevada, and is
duly qualified to do business as a foreign general
partnership, and is a foreign general partnership in good
standing, in each jurisdiction in which its ownership or
lease of property or the conduct of its business requires
such qualification (except where the failure to so qualify
would not have a material adverse effect on the Funding
Corporation and the Guarantors, taken as a whole). Each of
Power LLC, Minerals LLC and Turbo LLC is a limited liability
company duly formed and validly existing in good standing
under the laws of the State of Delaware, and is duly
qualified to do business as a foreign limited liability
company, and is a foreign limited liability company in good
standing, in each jurisdiction in which its ownership or
lease of property or the conduct of its business requires
such qualification (except where the failure to so qualify
would not have a material adverse effect on the Funding
Corporation and the Guarantors, taken as a whole). The
Funding Corporation and each Guarantor have all necessary
power and authority to own or lease their respective
properties and to conduct the respective businesses in which
they are engaged as described in the Offering Circular. All
of the outstanding shares of capital stock of the Funding
Corporation have been duly authorized and validly issued and
are fully paid and nonassessable and are owned by Magma
Power Company ("Magma"), free and clear of any claim, lien,
encumbrance or agreement, except as contemplated by the
Financing Documents; all of the partnership interests of
each of SSBP and SSPG represent valid partnership interests
in such partnership; all of the general partnership inter
ests in SSBP and SSPG are owned by Salton Sea Power Company
("SSPC"), free and clear of any claim, lien, encumbrance or
agreement except as contemplated by the Financing Documents;
all of the limited partnership interests in SSBP are owned
by Magma, free and clear of any claim, lien, encumbrance or
agreement except as contemplated by the Financing Documents;
all of the limited partnership interests in SSPG are owned
by SSBP, free and clear of any claim, lien, encumbrance or
agreement except as contemplated by the Financing Documents;
99% of the outstanding shares of capital stock of SSPC are
owned by Magma and 1% of such shares are owned by the
Funding Corporation, in each case free and clear of any
claim, lien, encumbrance or agreement except as contemplated
by the Financing Documents; all of the outstanding shares of
capital stock of each of VPC, CEOC, Fish Lake and SSRC have
been duly authorized and validly issued and are fully paid
and nonassessable; 99% of the outstanding shares of capital
stock of each of VPC, CEOC, Fish Lake and SSRC are owned by
Magma and 1% of the outstanding shares of capital stock of
each of VPC, CEOC, Fish Lake and SSRC are owned by the
Funding Corporation, in each case, free and clear of any
claim, lien, encumbrance or agreement except as contemplated
by the Financing Documents; all of the outstanding shares of
capital stock of BN/Geothermal, San Felipe, Conejo and
Niguel have been duly authorized and validly issued and are
fully paid and nonassessable; all of the outstanding shares
of capital stock of BN/Geothermal are owned by VPC, free and
clear of any claim, lien, encumbrance or agreement except as
contemplated by the Financing Documents; all of the
outstanding shares of capital stock of San Felipe, Conejo
and Niguel are owned by CEOC, free and clear of any claim,
lien, encumbrance or agreement except as contemplated by the
Financing Documents; all of the partnership interests in
Vulcan represent valid general partnership interests in
Vulcan; 50% of such partnership interests in Vulcan are
owned by BN/Geothermal and 50% of such partnership interests
are owned by VPC, in each case, free and clear of any claim,
lien, encumbrance or agreement except as contemplated by the
Financing Documents; all of the partnership interests in
each of Leathers, Del Ranch and Elmore represent valid
partnership interests in such partnership; a 40% general
partnership interest and a 10% limited partnership interest
in Leathers is owned by San Felipe, a 40% general
partnership interest in Leathers is owned by CEOC and a 10%
limited partnership interest in Leathers is owned by Magma,
in each case, free and clear of any claim, lien, encumbrance
or agreement except as contemplated by the Financing
Documents; a 40% general partnership interest and a 10%
limited partnership interest in Del Ranch is owned by
Conejo, a 40% general partnership interest in Del Ranch is
owned by CEOC and a 10% limited partnership interest in Del
Ranch is owned by Magma, in each case, free and clear of any
claim, lien, encumbrance or agreement except as contemplated
by the Financing Documents; a 40% general partnership
interest and a 10% general partnership interest in Elmore is
owned by Niguel, a 40% general partnership interest in
Elmore is owned by CEOC and a 10% limited partnership
interest in Elmore is owned by Magma, in each case, free and
clear of any claim, lien, encumbrance or agreement except as
contemplated by the Financing Documents; all of the
membership interests in each of Power LLC, Minerals LLC and
Turbo LLC represent valid membership interests in such
limited liability company; 50% of the membership interests
in Power LLC, Minerals LLC and Turbo LLC are owned by Magma,
free and clear of any claim, lien, encumbrance or agreement
except as contemplated by the Financing Documents; 50% of
the membership interests in Power LLC and Turbo LLC are
owned by CE Salton Sea Inc. ("CESS"), free and clear of any
claim, lien, encumbrance or agreement except as contemplated
by the Financing Documents; 50% of the membership interests
in Minerals LLC are owned by Salton Sea Minerals Corp.
("SSMC"), free and clear of any claim, lien, encumbrance or
agreement except as contemplated by the Financing Documents;
all of the outstanding shares of capital stock of CESS and
SSMC are owned by Magma, free and clear of any claim, lien,
encumbrance or agreement except as contemplated by the
Financing Documents.
(c) Each of the Funding Corporation and the
Guarantors has all power and authority necessary to execute
and deliver this Agreement and each other Transaction
Document to which it is a party and perform its obligations
hereunder and thereunder; each of this Agreement and the
other Transaction Documents to which the Funding Corporation
or the Guarantors is a party has been or on the Closing Date
(as hereinafter defined) will have been duly authorized,
executed and delivered by such party or parties thereto and
constitutes the legal, valid and binding obligation of such
party or parties, subject to the qualification that the
enforceability of such party's or parties' obligations
hereunder or thereunder may be limited by bankruptcy,
insolvency, reorganization, moratorium and other similar
laws relating to or affecting creditors' rights generally
and by general principles of equity and except as rights to
indemnity and contribution hereunder may be limited by
federal or state securities laws or principles of public
policy; the execution, delivery and performance by each of
the Funding Corporation and the Guarantors of this
Agreement, the Fourth Supplemental Indenture dated as of the
Closing Date (the "Supplemental Indenture") by and between
the Funding Corporation and the Trustee, the Securities and
the other Transaction Documents to which it is a party and
its compliance with the provisions hereof and thereof will
not breach or (except as contemplated by the Financing
Documents) result in the creation or imposition of any lien,
charge or encumbrance upon any asset which is material to
the Funding Corporation and the Guarantors, taken as a whole
(a "Material Asset"), pursuant to the terms of, or
constitute a breach of, or default under, the partnership
agreement or certificate of limited or general partnership
of SSBP, SSPG, Vulcan, Leathers, Elmore or Del Ranch, the
corporate charter or by-laws of the Funding Corporation,
Fish Lake, VPC, CEOC, BN/Geothermal, San Felipe, Conejo,
Niguel or SSRC, the limited liability company agreement or
certificate of limited liability company of Power LLC,
Minerals LLC or Turbo LLC or any agreement, indenture
(including, without limitation, the Indenture) or other in
strument to which the Funding Corporation or the Guarantors
is a party or by which the Funding Corporation or the Guaran
tors is bound (in each case which is material to the Funding
Corporation and the Guarantors, taken as a whole) or to
which any Material Asset is subject, or any law, order,
rule, regulation, judgment or decree of any court or
governmental agency having jurisdiction over the Funding
Corporation or the Guarantors or any Material Asset of the
Funding Corporation or the Guarantors; and, except as
completed on or prior to the Closing Date (as hereinafter
defined) or as required by applicable state securities laws,
no consent, authorization or order of, or filing or
registration by the Funding Corporation or any Guarantor
with, any court, governmental agency or third party is
required in connection with the execution, delivery and
performance of each of this Agreement and the other
Transaction Documents to which the Funding Corporation or
any Guarantor is a party.
(d) The execution, delivery and performance by
each of the Funding Corporation and the Guarantors of this
Agreement and the other Transaction Documents to which it is
a party and its compliance with the provisions hereof and
thereof will not conflict with, result in the creation or
imposition (except as contemplated by the Financing
Documents) of any lien, charge or encumbrance upon any asset
which is material to the business or financial condition of
CalEnergy Company, Inc. ("CalEnergy") or Magma pursuant to
the terms of, or constitute a breach of, or default under,
the corporate charter or by-laws of CalEnergy or Magma or
any agreement, indenture or other instrument material to the
business or financial condition of CalEnergy or Magma and to
which CalEnergy or Magma is a party or by which CalEnergy or
Magma is bound or to which any asset which is material to
the business or financial condition of CalEnergy or Magma is
subject, or any law, order, rule, regulation, judgment or
decree of any court or governmental agency having
jurisdiction over CalEnergy or Magma.
(e) None of the Funding Corporation, Fish Lake,
VPC, CEOC, BN/Geothermal, San Felipe, Conejo, Niguel or SSRC
is in violation of its respective corporate charter or by-
laws. None of Leathers, Elmore, Del Ranch, SSBP or SSPG is
in violation of its respective certificate of limited
partnership or partnership agreement. Vulcan is not in
violation of its certificate of general partnership or
partnership agreement. None of Power LLC, Minerals LLC or
Turbo LLC is in violation of its respective certificate of
limited liability company or limited liability company
agreement. Neither the Funding Corporation nor any
Guarantor (i) is in default, and no event has occurred
which, with notice or lapse of time or both, would con
stitute such a default, in the due performance and obser
vance of any material term, representation, covenant or
condition contained in any lease, license, indenture,
mortgage, deed of trust, note, bank loan or other evidence
of indebtedness or any other agreement, understanding or
instrument to which the Funding Corporation or any Guarantor
is a party or by which the Funding Corporation or any
Guarantor or any property of the Funding Corporation or any
Guarantor may be bound or affected, which default would have
a material adverse effect on the financial condition,
business or results of operations of the Funding Corporation
and the Guarantors, taken as a whole, or (ii) is in
violation of any law, ordinance, governmental rule or
regulation or court decree to which it may be subject, which
violation would have a material adverse effect on the
financial condition, business or results of operations of
any Guarantor, which would in turn be reasonably likely to
have a material adverse effect on the financial condition,
properties, business or results of operations of the
Guarantors, taken as a whole.
(f) Except as described in or contemplated by the
Offering Circular, each Guarantor represents, after due
inquiry, that it (i) has properly obtained each license,
permit, certificate, franchise or other governmental
authorization necessary to the ownership of its property or
to the conduct of its business as described in the Offering
Circular, and (ii) is in compliance with all terms and
conditions of such license, permit, certificate, franchise
or other governmental authorization, except (x) in either
case where the failure to do so would not have a material
adverse effect on the financial condition, business or
results of operations of the Funding Corporation and the
Guarantors, taken as a whole, (y) permits, consents and
approvals that may be required for future drilling or
operating activities which are ordinarily deemed to be
ministerial in nature and which are anticipated to be
obtained in the ordinary course and (z) permits, consents
and approvals for developmental or construction activities
which have not yet been obtained but which have been or will
be applied for in the course of development or construction
and which are anticipated to be obtained in the ordinary
course.
(g) Except as described in or contemplated by the
Offering Circular, each of the Funding Corporation and the
Guarantors holds, as applicable, good and valid title to, or
valid and enforceable leasehold or contractual interests in,
all items of real and personal property which are material
to the business of the Funding Corporation and the
Guarantors, taken as a whole, free and clear of all liens,
encumbrances and claims which would materially interfere
with the conduct of the business of the Funding Corporation
and the Guarantors, taken as a whole, as described in the
Offering Circular. Each of Vulcan, Leathers, Elmore, Del
Ranch, SSBP, SSPG, Fish Lake, Power LLC, Minerals LLC and
Turbo LLC has insurance coverage in such amounts and
covering such risks as is adequate for the conduct of its
business and the value of its properties and which is
consistent with what is customarily carried by similar
companies engaged in similar businesses. Each of the forego
ing insurance policies is valid and in full force and
effect. The Funding Corporation and the Guarantors are
presently conducting their respective businesses as
described in the Offering Circular and in substantial
compliance with all applicable rules, regulations and laws.
(h) Deloitte & Touche LLP, whose report appears
in the Offering Circular, is and was, during the period cov
ered by such report, independent with respect to the Funding
Corporation and the Guarantors within the meaning of the
Securities Exchange Act of 1934, as amended, and the
applicable rules and regulations thereunder (the "Exchange
Act").
(i) The Supplemental Indenture has been validly
authorized and, when executed by the proper officers of the
Funding Corporation (assuming the due authorization,
execution and delivery thereof by the Trustee) and delivered
by the Funding Corporation, will constitute the legal, valid
and binding obligation of the Funding Corporation, except as
the enforceability thereof may be limited by bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium
and other similar laws relating to or affecting creditors'
rights generally and by general principles of equity; the
Securities have been validly authorized and, upon payment
therefor on the Closing Date (as hereinafter defined) as
provided herein, will be validly issued and outstanding, and
will constitute obligations of the Funding Corporation
entitled to the benefits of the Indenture, except as the
enforceability thereof may be limited by bankruptcy, insol
vency, fraudulent transfer, reorganization, moratorium and
other similar laws relating to or affecting creditors'
rights generally and by general principles of equity; the
summary descriptions contained in the Offering Circular of
the Securities, the Indenture and the other Financing Docu
ments conform in all material respect to these documents.
(j) This Agreement has been duly authorized, exe
cuted and delivered by the Funding Corporation and the
Guarantors.
(k) Each Financing Document to which the Funding
Corporation is a party (other than this Agreement, the
Supplemental Indenture and the Securities) has been duly
authorized, executed and delivered by the Funding Corpo
ration and, assuming due authorization, execution and
delivery by the other Persons party thereto (other than such
Persons which are Guarantors or Affiliates thereof), consti
tutes the legal, valid and binding agreement of the Funding
Corporation, enforceable in accordance with its terms,
except as enforceability thereof may be subject to bank
ruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and other similar laws relating to or affecting
creditors' rights generally and to general principles of
equity.
(l) Each Financing Document to which any of the
Guarantors is a party (other than this Agreement) has been
duly authorized, executed and delivered by the Guarantors
party thereto and, assuming due authorization, execution and
delivery by the other Persons party thereto (other than such
Persons which are the Funding Corporation, other Guarantors
or Affiliates thereof), constitutes the legal, valid and
binding agreement of the Guarantors party thereto, enforce
able in accordance with its terms, except as enforceability
thereof may be subject to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and other similar laws
relating to or affecting creditors' rights generally and to
general principles of equity.
(m) Each Project Document to which any of the
Guarantors is a party has been duly authorized, executed and
delivered by the Guarantors party thereto and, assuming due
authorization, execution and delivery by the other parties
thereto which are not Guarantors or Affiliates thereof,
constitutes a legal, valid and binding agreement of such
Guarantor, enforceable against such Guarantor in accordance
with its respective terms, except as enforceability thereof
may be subject to bankruptcy, insolvency, reorganization,
moratorium and other similar laws relating to or affecting
creditors' rights generally and to general principles of
equity.
(n) The execution and delivery of each of the
Security Documents to which the Funding Corporation or any
of the Guarantors is a party or will be a party on the
Closing Date (as hereinafter defined) is or will be
effective to create in favor of the Collateral Agent for the
benefit of the Secured Parties and, in certain
circumstances, the Funding Corporation, as security for the
payment and performance of the obligations secured thereby,
a valid and enforceable security interest in the Collateral
covered or purported to be covered thereby. Such security
interests granted by the Funding Corporation, SSBP, SSPG,
Fish Lake, CEOC, VPC, BN/Geothermal, San Felipe, Conejo,
Niguel, Vulcan, Leathers, Elmore, Del Ranch and SSRC have
the priority purported to be created by such Security
Documents. All filings and recordings necessary to protect,
preserve and perfect such security interests have been made
and are in full force and effect. Upon recordation of each
Deed of Trust, Assignment of Rents, Security Agreement and
Fixture Filing, dated as of the Closing Date, entered into
by Power LLC, Minerals LLC and Turbo LLC (collectively, the
"New Deeds of Trust") and filing of the UCC-1 financing
statements naming Power LLC, Minerals LLC and Turbo LLC as
debtors and the Collateral Agent as secured party (the "Fi
nancing Statements"), such security interests granted by
such Guarantors will have the priority purported to be
created by such Security Documents. Each New Deed of Trust
is, or on the Closing Date will be, in appropriate form for
recording as a mortgage of real estate and for filing as a
fixture filing financing statement to protect, preserve and
perfect the liens and security interests created or to be
created by such New Deed of Trust. The Financing Statements
on the Closing Date will be in appropriate form for filing
(including the description of the Collateral set forth
therein) in each office and in each jurisdiction where re
quired to create and perfect the lien and security interest
described above.
(o) Magma, the Funding Corporation, SSPC, CESS,
SSMC and the Guarantors will own all of the Funding
Corporation Collateral and the Collateral on the Closing
Date (as hereinafter defined), free and clear of any Liens
other than Permitted Liens.
(p) Except as described in the Offering Circular,
there is no litigation or proceeding pending before or by
any court or governmental agency, authority or body, or any
arbitrator or, to the knowledge of the Funding Corporation
or any Guarantor, threatened, to which the Funding
Corporation or any Guarantor is a party or of which any
Material Asset of the Funding Corporation or any Guarantor
is the subject, including, without limitation, any audit by
the Internal Revenue Service of the federal income tax re
turns of the Funding Corporation or any Guarantor, which, if
an adverse decision were reached, would be likely to have a
material adverse effect on (x) the financial condition, busi
ness or results of operations of the Funding Corporation and
the Guarantors, taken as a whole, or (y) the ability of any
of the Funding Corporation or any Guarantor to perform in
any material respect their respective obligations under the
Transaction Documents to which any of them is a party.
(q) The financial statements (including the
related notes) included on pages F-1 through F-58 in the
Offering Circular present fairly the financial condition,
results of operations and changes in financial position of
the entities purported to be shown thereby, at the dates and
for the periods indicated, and, except as otherwise
described in the Offering Circular, have been prepared in
conformity with generally accepted accounting principles
applied on a consistent basis throughout the periods
involved, and the capitalization of the Funding Corporation
and the Guarantors, as set forth in the column labeled
"Actual" under the caption "Capitalization" in the Offering
Circular, is accurately described as of the date presented
therein.
(r) Except as disclosed in the Offering Circular,
since the date of the latest audited financial statements
included in the Offering Circular there has been no material
adverse change, nor any development or event involving a
prospective material adverse change, in the financial
condition, business or results of operations of the Funding
Corporation and the Guarantors, taken as a whole.
(s) The factual information provided by the Fund
ing Corporation and the Guarantors to Fluor Daniel, Inc.
(the "New Project Independent Engineer"), GeothermEx, Inc.
(the "Geothermal Resource Consultant"), Henwood Energy
Services (the "Independent Power Market Consultant") and
Resource Strategies International (the "Independent Zinc
Market Consultant") in the preparation of their reports set
forth at Appendices B, C, D and E to the Offering Circular
(which factual information is referenced in such reports)
was provided in good faith; provided that the foregoing does
not imply or express any representation or warranty by the
Funding Corporation and the Guarantors as to the accuracy of
the projections or conclusions contained in such reports and
does not constitute any obligation to update such reports.
(t) No labor problem or disturbance with the
persons employed in connection with the Projects exists or,
to the knowledge of the Funding Corporation or any
Guarantor, is threatened which might reasonably be expected
to have a material adverse effect on the business, financial
condition or results of operations of the Funding
Corporation and the Guarantors, taken as a whole.
(u) Neither the Funding Corporation nor any
Guarantor nor any of their respective affiliates nor
(assuming the accuracy of the representations of the
Purchasers set forth herein) any person acting on their
behalf has made offers or sales of securities under
circumstances that would require the registration of the
Securities under the Securities Act.
(v) The Securities meet the eligibility
requirements of Rule 144A(d)(3) under the Securities Act.
(w) Neither the Funding Corporation nor any
Guarantor is an open-end investment company, unit investment
trust or face-amount certificate company that is or is
required to be registered under Section 8 of the United
States Investment Company Act of 1940, as amended (the
"Investment Company Act"), nor is it a closed-end investment
company required to be registered, but not registered,
thereunder; and neither the Funding Corporation nor any
Guarantor is and, after giving effect to the offering and
sale of the Securities and the application of the proceeds
thereof as described in the Offering Circular, neither the
Funding Corporation nor any Guarantor will be an "investment
company" as defined in the Investment Company Act.
(x) No securities of the same class (within the
meaning of Rule 144A(d)(3) under the Securities Act) as the
Securities are listed on any national securities exchange
registered under Section 6 of the Exchange Act or quoted in
a U.S. automated inter-dealer quotation system.
(y) Assuming the accuracy of the representations
of the Purchaser herein, the offer and sale of the
Securities in the manner contemplated by this Agreement will
be exempt from the registration requirements of the Securi
ties Act by reason of Section 4(2) thereof, Regulation D
thereunder and Regulation S thereunder; and it is not
necessary to qualify an indenture in respect of the Securi
ties under the United States Trust Indenture Act of 1939, as
amended (the "Trust Indenture Act").
(z) Assuming the accuracy of the representations
of the Purchaser herein, neither the Funding Corporation or
any Guarantor nor any of their affiliates or any person
acting on their behalf (i) has, within the six-month period
prior to the date hereof, offered or sold in the United
States or to any U.S. person (as such terms are defined in
Regulation S under the Securities Act) the Securities or any
security of the same class or series as the Securities
(excluding the Exchange Securities) or (ii) has offered or
will offer or sell the Securities (A) in the United States
by means of any form of general solicitation or general
advertising within the meaning of Rule 502(c) under the
Securities Act or (B) with respect to any such securities
sold in reliance on Rule 903 of Regulation S ("Regulation
S") under the Securities Act, by means of any directed sell
ing efforts within the meaning of Rule 902(b) of Regulation
S. Assuming the accuracy of the representations of the
Purchaser herein, the Funding Corporation, the Guarantors
and any person acting on their behalf have complied and will
comply with the offering restrictions requirement of
Regulation S.
(aa) The proceeds to the Funding Corporation from
the offering of the Securities will not be used to purchase
or carry any security, except as contemplated in the
Offering Circular.
(bb) Each of the Salton Sea Projects and
Partnership Projects (other than the Zinc Project) is a
"Qualifying Small Power Production Facility," as such term
is defined pursuant to the Public Utility Regulatory Poli
cies Act of 1978, as amended. None of the Guarantors or the
Funding Corporation, will, solely as a result of the
participation by the parties separately or as a group in the
transactions contemplated by the Financing Documents and the
ownership, use or operation of the Projects, be subject to
regulation by any Governmental Authority as a "public
utility," an "electric utility," an "electric utility
holding company," a "public utility holding company," a
"holding company" or an "electrical corporation" or a
subsidiary or affiliate of any of the foregoing under any
Law (including, without limitation, rules and regulations of
the California State Energy Resources Conservation and Devel
opment Commission, the Public Utility Holding Company Act of
1935, the Federal Power Act of 1920 and the Public Utility
Regulatory Policies Act of 1978, each as amended); provided
that either Turbo LLC or Power LLC may elect to become an
Exempt Wholesale Generator and thereby become a "public
utility" subject to regulation by FERC and the FPA.
(cc) None of the Funding Corporation or any of
the Guarantors is a "party in interest" or a "disqualified
person" (within the meaning of Section 4975 of the Internal
Revenue Code of 1986, as amended) with respect to any
"employee benefit plan" (within the meaning of Section 3(3)
of the Employee Retirement Income Security Act of 1974, as
amended).
(dd) The proceeds from the sale of Securities
will be loaned by the Funding Corporation to the Salton Sea
Guarantors and the Partnership Guarantors and utilized by
the Salton Sea Guarantors and the Partnership Guarantors as
described under the section of the Offering Circular titled
"Use of Proceeds."
3. Purchase, Sale and Delivery of Offered Securities.
On the basis of the representations, warranties and
agreements herein contained, but subject to the terms and
conditions herein set forth, the Funding Corporation agrees
to sell to the Purchasers, and the Purchasers agree,
severally and not jointly, to purchase from the Funding
Corporation, at a purchase price of 99.125% of the principal
amount of the Securities, plus accrued interest from October
13, 1998 to the Closing Date (as hereinafter defined), the
respective principal amounts of the Securities set forth
opposite the names of the several Purchasers in Schedule I
hereto. The Funding Corporation will deliver against
payment of the purchase price the Securities in the form of
one or more permanent global Securities in registered form
without interest coupons (the "Global Securities"), which
will be deposited with the Trustee, as custodian for The
Depository Trust Company ("DTC"), and registered in the name
of Cede & Co., as nominee for DTC. Interests in any perma
nent Global Securities will be held only in book-entry form,
except in the limited circumstances described in the
Offering Circular.
Payment for the Securities shall be made by the
Purchasers in federal (same day) funds by official check or
checks or wire transfer to an account in New York previously
designated to CSFBC by the Funding Corporation drawn to the
order of the Funding Corporation, at the office of Skadden,
Arps, Slate, Meagher & Flom LLP, 919 Third Avenue, New York,
New York, 10022 at 10:00 A.M., (New York time), on October
13, 1998 or at such other date and time not later than seven
full business days thereafter as CSFBC and the Funding
Corporation determine, such time being herein referred to as
the "Closing Date", against delivery to the Trustee as
custodian for DTC of Global Securities representing all of
the Securities. The Global Securities will be made
available for checking at the above office of Skadden, Arps,
Slate, Meagher & Flom LLP at least 24 hours prior to the
Closing Date.
Notwithstanding the foregoing, any Securities sold
to Institutional Accredited Investors (as hereinafter
defined) pursuant to Section 4(e) shall be issued in
definitive physical certificates and shall bear the legend
relating thereto set forth under "TRANSFER RESTRICTIONS" in
the Offering Circular, but shall be paid for in the same
manner as any Securities to be purchased by the Purchasers
hereunder and to be offered and sold by them in reliance on
Rule 144A under the Securities Act.
4. Representations by Purchasers; Resale by Purchaser.
(a) Each Purchaser severally represents and
warrants to the Funding Corporation that it is an ?accred
ited investor? within the meaning of Regulation D under the
Securities Act.
(b) Each Purchaser severally acknowledges that
the Securities have not been registered under the Securities
Act and may not be offered or sold within the United States
or to, or for the account or benefit of, U.S. persons except
in accordance with Regulation S or pursuant to an exemption
from the registration requirements of the Securities Act.
Each Purchaser severally represents and agrees that it has
offered and sold the Securities, and will offer and sell the
Securities, only in accordance with Rule 903, Rule 144A
under the Securities Act (?Rule 144A?) or to a limited
number of Institutional Accredited Investors in accordance
with clause (e)(ii) of this Section 4. Accordingly, neither
such Purchaser nor its affiliates, nor any persons acting on
its or their behalf, have engaged or will engage in any
directed selling efforts with respect to the Securities, and
such Purchaser, its affiliates and all persons acting on its
or their behalf have complied and will comply with the
offering restrictions requirement of Regulation S. Each
Purchaser severally agrees that, at or prior to confirmation
of sale of the Securities, other than a sale pursuant to
Rule 144A or a sale to an Institutional Accredited Investor
in accordance with clause (e)(ii) of this Section 4, such
Purchaser will have sent to each distributor, dealer or
person receiving a selling concession, fee or other
remuneration that purchases the Securities from it a
confirmation or notice to substantially the following
effect:
"The Securities covered hereby have not been
registered under the U.S. Securities Act of 1933
(the "Securities Act") and may not be offered or
sold within the United States or to, or for the
account or benefit of, U.S. persons as part of
their distribution at any time, except in either
case in accordance with Regulation S (or Rule
144A, if available) under the Securities Act.
Terms used above have the meanings given to them
by Regulation S."
Terms used in this subsection (b) have the meanings given to
them by Regulation S.
(c) Each Purchaser severally agrees that it and
each of its affiliates has not entered and will not enter
into any contractual arrangement with respect to the
distribution of the Securities except for any such arrange
ments entered into with the prior written consent of the
Funding Corporation.
(d) Each Purchaser severally agrees that it and
each of its affiliates has not offered or sold the
Securities and will not offer or sell the Securities in the
United States by means of any form of general solicitation
or general advertising within the meaning of Rule 502(c)
under the Securities Act, including, but not limited to
(i) any advertisement, article, notice or other communica
tion published in any newspaper, magazine or similar media
or broadcast over television or radio, or (ii) any seminar
or meeting whose attendees have been invited by any general
solicitation or general advertising. Each Purchaser
severally agrees, with respect to resales made in reliance
on Rule 144A of any of the Securities, to deliver either
with the confirmation of such resale or otherwise prior to
settlement of such resale a notice to the effect that the
resale of such Securities has been made in reliance upon the
exemption from the registration requirements of the
Securities Act provided by Rule 144A.
(e) Each Purchaser severally agrees that it will
offer to sell the Securities only to, and will solicit
offers to buy the Securities from, persons who in purchasing
the Securities will be deemed to have represented and agreed
that such person (i)(A) is a Qualified Institutional Buyer,
(B) is aware that the sale to it is being made in reliance
on Rule 144A and (C) is acquiring such Securities for its
own account or for the account of a Qualified Institutional
Buyer, (ii) is (A) an institutional "accredited investor"
(as defined in Rule 501 (a)(1), (2), (3) or (7) under the
Securities Act) and (B) concurrently with its purchase
executing and delivering the purchaser's letter containing
certain representations and agreements in substantially the
form attached as Appendix F to the Offering Circular or
(iii) is not a U.S. person and is purchasing such Securities
in an offshore transaction pursuant to Regulation S.
5. Certain Agreements of the Funding Corporation and
the Guarantors. The Funding Corporation and the Guarantors
agree with the several Purchasers that:
(a) The Funding Corporation and the Guarantors
will advise CSFBC promptly of any proposal to amend or
supplement the Offering Circular and will not effect such
amendment or supplementation without the CSFBC's consent.
If, at any time prior to the completion of the resale of the
Securities by the Purchasers, any event occurs as a result
of which the Offering Circular as then amended or
supplemented would include an untrue statement of a material
fact or omit to state any material fact necessary in order
to make the statements therein, in the light of the circum
stances under which they were made, not misleading, the
Funding Corporation and the Guarantors promptly will notify
CSFBC of such event and promptly will prepare, at their own
expense, an amendment or supplement which will correct such
statement or omission. Neither CSFBC's consent to, nor the
Purchasers' delivery to offerees or investors of, any such
amendment or supplement shall constitute a waiver of any of
the conditions set forth in Section 6.
(b) The Funding Corporation and the Guarantors
will furnish to CSFBC copies of the Preliminary Offering
Circular, the Offering Circular and all amendments and
supplements to such documents, in each case as soon as
available and in such quantities as CSFBC requests, and the
Funding Corporation will furnish to CSFBC on the date hereof
three copies of the Offering Circular. At any time when the
Funding Corporation is not subject to Section 13 or 15(d) of
the Exchange Act, the Funding Corporation will promptly
furnish or cause to be furnished to the Purchasers and, upon
request of holders and prospective purchasers of the Securi
ties, to such holders and purchasers, copies of the informa
tion required to be delivered to holders and prospective
purchasers of the Securities pursuant to Rule 144A(d)(4)
under the Securities Act (or any successor provision
thereto) in order to permit compliance with Rule 144A in
connection with resales by such holders of the Securities.
The Funding Corporation and the Guarantors will pay the
expenses of printing and distributing to the Purchasers and
such holders and purchasers all such documents.
(c) The Funding Corporation and the Guarantors
will arrange for the qualification of the Securities for
sale and the determination of their eligibility for invest
ment under the laws of such jurisdictions in the United
States and Canada as CSFBC designates and will continue such
qualifications in effect so long as required for the resale
of the Securities by the Purchasers, provided that the
Funding Corporation and the Guarantors will not be required
to qualify as a foreign corporation or to file a general
consent to service of process in any such jurisdiction.
(d) During the period of five years hereafter,
the Funding Corporation will furnish to the Purchasers, as
soon as available after the end of each fiscal year, a copy
of its annual audited financial statements and the annual
audited financial statements of the Guarantors (on a
combined basis).
(e) During the period of two years after the
Closing Date, the Funding Corporation will, upon request,
furnish to the Purchasers and any holder or beneficial owner
of Securities a copy of the restrictions on transfer
applicable to the Securities.
(f) During the period of two years after the
Closing Date, the Funding Corporation and the Guarantors
will not, and will not permit any of their affiliates (as
defined in Rule 144 under the Securities Act) to, resell any
of the Securities that have been reacquired by any of them.
(g) During the period of two years after the
Closing Date, the Funding Corporation and the Guarantors
will not be or become an open-end investment company, unit
investment trust or face-amount certificate company that is
or is required to be registered under Section 8 of the
Investment Company Act, and none of the Funding Corporation
nor any of the Guarantors is or will become a closed-end
investment company required to be registered, but not regis
tered, under the Investment Company Act.
(h) The Funding Corporation and the Guarantors
will pay all expenses incidental to the performance of their
obligations under this Agreement, the Indenture and the
other Financing Documents, including, without limitation (i)
the fees and expenses of the Trustee and its professional
advisers, and (ii) all expenses in connection with the
execution, issue, authentication, packaging and initial
delivery of the Securities, the preparation and printing of
this Agreement, the Securities, the Indenture, the
Preliminary Offering Circular, the Offering Circular and
amendments and supplements thereto, and any other document
relating to the issuance, offer, sale and delivery of the
Securities. The Funding Corporation and the Guarantors will
also pay or reimburse the Purchasers (to the extent incurred
by them) for any expenses actually and reasonably incurred
by the Purchasers in connection with the purchase and sale
of the Securities, including, without limitation, all out-
of-pocket expenses incurred by the Purchasers (such as, but
not limited to, travel, hotel, telephone and telecopy
charges), all fees and disbursements of counsel to the
Purchasers, expenses related to qualification of the Securi
ties for sale under the laws of such jurisdictions in the
United States and Canada as CSFBC designates and the
printing of memoranda relating thereto, up to $1,000 ("blue
sky fees"), fees charged by investment rating agencies for
the rating of the Securities ("rating agency fees"), all
travel expenses of the Purchasers' and the Funding
Corporation's or the Guarantors' officers and employees and
any other expenses of the Purchasers and the Funding
Corporation or the Guarantors in connection with attending
or hosting meetings with prospective purchasers of the
Securities from the Purchasers and for expenses incurred in
distributing Preliminary Offering Circulars and Offering
Circulars (including any amendments and supplements thereto)
to the Purchasers and prospective purchasers of the
Securities from the Purchasers; provided that such fees and
expenses (other than rating agency fees, blue sky fees and
fees and disbursements of counsel to the Purchasers) are
estimated to be approximately $175,000 and will be subject
to audit and verification by the Funding Corporation and the
Guarantors that such fees and expenses were reasonably
incurred in connection with the issuance and offering of the
Securities.
(i) In connection with the offering of the
Securities, until the earlier of (x) 180 days following the
Closing Date and (y) the date on which CSFBC shall have
notified the Funding Corporation of the completion of the
resale of the Securities, neither the Funding Corporation,
the Guarantors nor any of their affiliates has or will,
either alone or with one or more other persons, bid for or
purchase for any account in which it or any of its
affiliates has a beneficial interest any Securities or
attempt to induce any person to purchase any Securities; and
neither the Funding Corporation, the Guarantors nor any of
their affiliates will make bids or purchases for the purpose
of creating actual, or apparent, active trading in, or of
raising the price of, the Securities.
(j) The Funding Corporation will not, until 30
days following the Closing Date, without the prior written
consent of CSFBC, pursuant to Rule 144A, Regulation S or an
offering registered under the Securities Act, offer, sell or
contract to sell, or otherwise dispose of, directly or
indirectly, or announce the offering of, any debt securities
issued or guaranteed by the Funding Corporation or any of
the Guarantors (other than the Securities).
6. Conditions of the Obligations of the Purchaser.
The obligations of the Purchasers to purchase and pay for
the Securities will be subject to the accuracy of the repre
sentations and warranties made by the Funding Corporation
and the Guarantors herein, to the accuracy of the statements
of officers of the Funding Corporation and the Guarantors
made pursuant to the provisions hereof, to the performance
by the Funding Corporation and the Guarantors of their
obligations hereunder and to the following additional
conditions precedent:
(a) The Purchasers shall have received a letter,
dated the date of this Agreement, of Deloitte & Touche LLP
in form and substance reasonably satisfactory to CSFBC con
cerning the financial information with respect to the
Funding Corporation and the Guarantors set forth in the
Offering Circular.
(b) Subsequent to the execution and delivery of
this Agreement, there shall not have occurred (i) any
change, or any development or event involving a prospective
change, in or affecting the financial condition, business or
results of operations of the Funding Corporation or any of
the Guarantors which, in the reasonable judgment of the
Purchasers, materially impairs the investment quality of the
Securities or is material and adverse and makes it
impractical or inadvisable to proceed with the offering of
the Securities; (ii) any downgrading in the rating of the
Securities, the Series A Securities, the Series B
Securities, the Series C Securities, the Series D Securities
or the Series E Securities by Standard & Poor's Ratings
Group or Moody's Investors Service, Inc. or any public
announcement that such organization has under surveillance
or review its rating of the Securities, the Series A
Securities, the Series B Securities, the Series C
Securities, the Series D Securities or the Series E
Securities (other than an announcement with positive implica
tions of a possible upgrading, and no implication of a
possible downgrading, of such rating); (iii) any suspension
or limitation of trading in securities generally on the New
York Stock Exchange, or any setting of minimum prices for
trading on such exchange or any suspension of trading of any
securities of CalEnergy on any exchange or in the over the
counter market; (iv) any banking moratorium declared by U.S.
federal or New York authorities; (v) any outbreak or
escalation of hostilities in which the United States is
involved, any declaration of war by the United States
Congress or any other change in financial markets or
substantial national calamity or emergency if, in the
judgment of the Purchasers, the effect of any such outbreak,
escalation, declaration, change, calamity or emergency makes
it impractical or inadvisable to proceed with completion of
the sale of and payment for the Securities; or (vi) any
invalidation of Rule 144A or Regulation S by any court or
any amendment or proposed amendment of any rule or
regulation under the Securities Act or the Exchange Act by
the Commission which in the Purchasers' judgment would
materially impair the Purchasers' ability to purchase, hold
or effect resales of the Securities as contemplated hereby
or the ability of holders of the Securities to effect
resales as currently contemplated by Rule 144A and
Regulation S.
(c) The representations and warranties of each of
the Funding Corporation and the Guarantors contained herein
and in each Transaction Document to which the Funding
Corporation or any of the Guarantors is party shall be true
and correct on and as of the Closing Date with the same
effect as though such representations and warranties had
been made on and as of the Closing Date, each of the Funding
Corporation and the Guarantors shall have complied with all
agreements and satisfied all conditions on its part to be
performed or satisfied hereunder or thereunder at or prior
to the Closing Date and, subsequent to the respective dates
of the most recent financial statements in the Offering
Circular, there shall have been no material adverse change
in the financial position or results of operation of the
Funding Corporation and the Guarantors, taken as a whole, as
evidenced by a certificate, dated the Closing Date, of the
President or any Vice-President and a principal financial or
accounting officer of the Funding Corporation and the
Guarantors.
(d) CalEnergy shall have duly authorized,
executed and delivered the Equity Commitment Agreement, in
such form as shall be satisfactory to the Purchasers and
their counsel, and the Equity Commitment Agreement shall
constitute a valid and legally binding agreement of
CalEnergy, enforceable in accordance with its terms, except
as enforceability thereof may be subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium
and similar laws relating to or affecting creditors' rights
generally and to general principles of equity.
(e) On or prior to the Closing Date, the Funding
Corporation and the Guarantors, as applicable, shall have
entered into the Supplemental Indenture, the Amended and
Restated Depositary Agreement, Amendment No. 2 to the
Intercreditor Agreement, the Securities Account Control
Agreement, the Securities, the Series F Registration Rights
Agreement, the Second Amended and Restated Debt Service
Reserve LOC Reimbursement Agreement, the Amended and
Restated Salton Sea Credit Agreement, the Second Amended and
Restated Partnership Credit Agreement, the Amended and
Restated Salton Sea Secured Guarantee, the Second Amended
and Restated Partnership Secured Limited Guarantee and such
additional Financing Documents and amendments, modifications
or supplements thereto as may be reasonably required by the
Purchasers in connection with the issuance of Securities,
all in such form as shall be reasonably satisfactory to the
Purchasers and their counsel; and such Financing Documents
and such amendments, modifications or supplements shall have
been fully executed and delivered and shall remain in full
force and effect on the Closing Date; and all conditions
precedent under the Second Amended and Restated Debt Service
Reserve LOC Reimbursement Agreement to the issuance of one
or more Debt Service Reserve Letters of Credit in an
aggregate face amount equal to the Debt Service Reserve Fund
Required Balance (as defined in the Depositary Agreement) as
of the Closing Date shall have been satisfied on the Closing
Date and the Funding Corporation shall have delivered to the
Purchasers evidence reasonably satisfactory to the
Purchasers that the Debt Service Reserve Letter of Credit
currently anticipated to be required to be delivered to the
Depository Agent in order to fund the Debt Service Reserve
Fund at the Debt Service Reserve Fund Required Balance (as
defined in the Depositary Agreement) has been obtained and
is in existence on the Closing Date or other arrangements
with respect to such obligations acceptable to the Pur
chasers shall have been made.
(f) The Purchasers shall have received copies of
all legal opinions rendered in connection with the
transactions contemplated by the documents listed in
paragraph (e) above and reliance letters in respect thereof.
(g) On or prior to the Closing Date, the Funding
Corporation or the Guarantors shall have delivered to the
Purchasers evidence satisfactory to the Purchasers and their
counsel that a title policy or policies in the aggregate
amount of $100,000,000 insuring the New Deeds of Trust has
been obtained, each of which title policies shall be
satisfactory in form and substance to the Purchasers and
their counsel.
(h) On or prior to the Closing Date, each New
Deed of Trust shall have been delivered to Commonwealth Land
Title Company (the "Title Company") for due recordation as a
mortgage of real estate, and any required filings with
respect to personal property and fixtures subject to the
liens of such New Deed of Trust shall have been delivered to
the Title Company for filing, in each place in which such
recording or filing is required to protect, preserve and
perfect the liens of such New Deed of Trust as a valid and
enforceable lien on the real estate and as a valid and
enforceable security interest in the personal property and
fixtures covered or purported to be covered by such New Deed
of Trust, with the priority purported to be created thereby,
in each case subject only to Permitted Liens, and except for
such recordation or filing no further action shall be re
quired to create, preserve or perfect such liens and secu
rity interests. The Financing Statements and such other UCC-
1 financing statements shall have been delivered for filing,
recordation and/or registration in each office and in each
jurisdiction where required to create and perfect a valid
and enforceable security interest in the Collateral and the
Funding Corporation Collateral covered or purported to be
covered by the Security Documents, with the priority
purported to be created thereby. All taxes and recording
and filing fees required to be paid with respect to the
execution, recording or filing of the New Deeds of Trust and
the Financing Statements and such other UCC-1 financing
statements shall have been paid or provided for. All
Collateral and Funding Corporation Collateral shall be
subject to no Liens other than Permitted Liens.
(i) On or prior to the Closing Date, each of the
Project Documents, in the forms as previously delivered to
the Purchasers or their counsel and as they exist as
executed versions as of the date of this Agreement or in
such forms as shall be reasonably satisfactory in form and
substance to the Purchasers and their counsel, shall have
been executed and delivered, shall remain in full force and
effect, no default shall have occurred thereunder, all
conditions precedent thereunder shall be satisfied and there
shall not have occurred any event of force majeure
thereunder as of the Closing Date.
(j) The Purchasers shall have received a letter,
dated the Closing Date, of Deloitte & Touche LLP that meets
the requirements of subsection (a) of this Section 6, except
that the specified date referred to in such subsection will
be a date not more than five days prior to the Closing Date
for the purposes of this subsection.
(k) The New Project Independent Engineer shall
have consented to the references to it in the Offering
Circular and the use of the Independent Engineer's Report
(as defined in the Offering Circular) prepared by the New
Project Independent Engineer and contained in Appendix B to
the Offering Circular; and since the date of the Independent
Engineer's Report, no event affecting the Independent
Engineer's Report or the matters referred to therein shall
have occurred (A) which shall make untrue or incorrect in
any material respect, as of the Closing Date, any
information or statement contained in the Independent
Engineer's Report or in the Offering Circular relating to
matters referred to in the Independent Engineer's Report, or
(B) which shall not be reflected in the Offering Circular
but should be reflected therein in order to make the
statements and information contained in the Independent Engi
neer's Report, or in the Offering Circular relating to
matters referred to in the Independent Engineer's Report, in
light of the circumstances under which they were made, not
misleading, as evidenced by a certificate reasonably
satisfactory to the Purchasers of an authorized officer of
the New Project Independent Engineer, dated the Closing
Date.
(l) The Geothermal Resource Consultant shall have
consented to the references to it in the Offering Circular
and the use of the Geothermal Resource Consultant's Report
(as defined in the Offering Circular) prepared by the
Geothermal Resource Consultant and contained in Appendix D
to the Offering Circular; and since the date of the
Geothermal Resource Consultant's Report, no event affecting
the Geothermal Resource Consultant's Report or the matters
referred to therein shall have occurred (A) which shall make
untrue or incorrect in any material respect, as of the
Closing Date, any information or statement contained in the
Geothermal Resource Consultant's Report or in the Offering
Circular relating to matters referred to in the Geothermal
Resource Consultant's Report, or (B) which shall not be
reflected in the Offering Circular but should be reflected
therein in order to make the statements and information
contained in the Geothermal Resource Consultant's Report, or
in the Offering Circular relating to matters referred to in
the Geothermal Resource Consultant's Report, in light of the
circumstances under which they were made, not misleading, as
evidenced by a certificate reasonably satisfactory to the
Purchasers of an authorized officer of the Geothermal
Resource Consultant, dated the Closing Date.
(m) The Independent Power Market Consultant shall
have consented to the references to it in the Offering
Circular and the use of the Independent Power Market
Consultant's Report (as defined in the Offering Circular)
prepared by the Independent Power Market Consultant and
contained in Appendix C to the Offering Circular; and since
the date of the Independent Power Market Consultant's
Report, no event affecting the Independent Power Market
Consultant's Report or the matters referred to therein shall
have occurred (A) which shall make untrue or incorrect in
any material respect, as of the Closing Date, any
information or statement contained in the Independent Power
Market Consultant's Report or in the Offering Circular
relating to matters referred to in the Independent Power
Market Consultant's Report, or (B) which shall not be
reflected in the Offering Circular but should be reflected
therein in order to make the statements and information
contained in the Independent Power Market Consultant's
Report, or in the Offering Circular relating to matters
referred to in the Independent Power Market Consultant's
Report, in light of the circumstances under which they were
made, not misleading, as evidenced by a certificate
reasonably satisfactory to the Purchasers of an authorized
officer of the Independent Power Market Consultant, dated
the Closing Date.
(n) The Independent Zinc Market Consultant shall
have consented to the references to it in the Offering
Circular and the use of the Independent Zinc Market
Consultant's Report (as defined in the Offering Circular)
prepared by the Independent Zinc Market Consultant and
contained in Appendix F to the Offering Circular; and since
the date of the Independent Zinc Market Consultant's Report,
no event affecting the Independent Zinc Market Consultant's
Report or the matters referred to therein shall have
occurred (A) which shall make untrue or incorrect in any
material respect, as of the Closing Date, any information or
statement contained in the Independent Zinc Market
Consultant's Report or in the Offering Circular relating to
matters referred to in the Independent Zinc Market
Consultant's Report, or (B) which shall not be reflected in
the Offering Circular but should be reflected therein in
order to make the statements and information contained in
the Independent Zinc Market Consultant's Report, or in the
Offering Circular relating to matters referred to in the
Independent Zinc Market Consultant's Report, in light of the
circumstances under which they were made, not misleading, as
evidenced by a certificate reasonably satisfactory to the
Purchasers of an authorized officer of the Independent Zinc
Market Consultant, dated the Closing Date.
(o) The Purchasers shall have received a
certificate, dated the Closing Date, of any President or
Vice President of the Funding Corporation and the
Guarantors, certifying, based on customary assumptions, that
there are sufficient geothermal resources to operate the
Salton Sea Projects and the Partnership Projects through the
Final Maturity Date.
(p) The Purchasers shall have received opinions,
dated the Closing Date, of Willkie Farr & Gallagher, Latham
& Watkins, Lionel Sawyer & Collins and White & Case, each
counsel for the Funding Corporation and the Guarantors, and
Steven A. McArthur, Esq., Executive Vice President and
General Counsel for the Funding Corporation and the
Guarantors, to the effect as set forth in Annexes B, C, D, E
and F hereto and reasonably satisfactory in all respects to
CSFBC and its counsel.
(q) The Purchasers shall have received an
opinion, dated the Closing Date, from Lillick & Charles,
counsel to the Trustee, the Collateral Agent and the
Depositary Agent, in respect of the enforceability of the
Financing Documents to which the Trustee, the Collateral
Agent and the Depositary Agent are parties and the
authentication of the Securities by the Trustee, which
opinion shall be satisfactory in all respects to CSFBC and
its counsel.
(r) The Purchasers shall have received from
Skadden, Arps, Slate, Meagher & Flom LLP, counsel for the
Purchasers, such opinion or opinions as CSFBC may reasonably
request, dated the Closing Date, with respect to the
Offering Circular, and the Funding Corporation and the
Guarantors shall have furnished to such counsel such
documents as they request for the purpose of enabling them
to pass upon such matters.
(s) The Purchasers shall have received, in form
and substance satisfactory to CSFBC, copies of such
opinions, certificates, letters and documents as CSFBC
reasonably requests.
7. Indemnification and Contribution.
(a) The Funding Corporation and the Guarantors
will indemnify and hold harmless each Purchaser against any
losses, claims, damages or liabilities, joint or several, to
which such Purchaser may become subject, under the
Securities Act or the Exchange Act or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any breach
of any of the representations and warranties of the Funding
Corporation and the Guarantors contained herein or any
untrue statement or alleged untrue statement of any material
fact contained in the Offering Circular, or any amendment or
supplement thereto, or any related Preliminary Offering
Circular, or arise out of or are based upon the omission or
alleged omission to state therein a material fact necessary
in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading,
and will reimburse each Purchaser for any legal or other
expenses reasonably incurred by such Purchaser in connection
with investigating or defending any such loss, claim,
damage, liability or action as such expenses are incurred;
provided, however, that the Funding Corporation and the
Guarantors will not be liable in any such case to the extent
that any such loss, claim, damage or liability arises out of
or is based upon an untrue statement or alleged untrue
statement in or omission or alleged omission from any of
such documents in reliance upon and in conformity with
written information furnished to the Funding Corporation by
any Purchaser through CSFBC specifically for use therein, it
being understood and agreed that the only such information
consists of the information described as such in
subsection (b) below; and provided, further that, with
respect to any untrue statement or omission in the
Preliminary Offering Circular, this indemnity agreement
shall not inure to the benefit of any Purchaser on account
of any loss, claim, damage, liability or action arising from
the sale of any Securities to any person by such Purchaser
if such Purchaser failed to send or give a copy of the
Offering Circular, as the same may be amended or supple
mented, to that person within the time required by the
Securities Act, and the untrue statement or alleged untrue
statement of a material fact or omission or alleged omission
to state a material fact in the Preliminary Offering Circu
lar was corrected in the Offering Circular and the Offering
Circular was made available to such Purchaser prior to the
sale of the Securities.
(b) Each Purchaser will severally and not jointly
indemnify and hold harmless the Funding Corporation and the
Guarantors against any losses, claims, damages or
liabilities to which the Funding Corporation and the
Guarantors may become subject, under the Securities Act, the
Exchange Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise
out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in the
Offering Circular, or any amendment or supplement thereto,
or any related preliminary offering circular, or arise out
of or are based upon the omission or the alleged omission to
state therein a material fact necessary in order to make the
statements therein, in the light of the circumstances under
which they were made, not misleading, in each case to the
extent, but only to the extent, that such untrue statement
or alleged untrue statement or omission or alleged omission
was made in reliance upon and in conformity with written
information furnished to the Funding Corporation by such
Purchaser through CSFBC specifically for use therein, and
will reimburse for any legal or other expenses reasonably
incurred by the Funding Corporation in connection with
investigating or defending any such loss, claim, damage,
liability or action as such expenses are incurred, it being
understood and agreed that the only such information
furnished by any Purchaser consists of the following
information in the Offering Circular: the last paragraph at
the bottom of the cover page concerning the terms of the
offering by the Purchasers, the legend concerning stabiliz
ing on the inside front cover page and the third paragraph,
the fifth paragraph, the second sentence of the seventh
paragraph, the eighth paragraph and the ninth paragraph
under the caption "PLAN OF DISTRIBUTION."
(c) Promptly after receipt by an indemnified
party under this Section 7 of notice of the commencement of
any action, such indemnified party will, if a claim in
respect thereof is to be made against the indemnifying party
under subsection (a) or (b) above, notify the indemnifying
party of the commencement thereof; but the omission so to
notify the indemnifying party will not relieve it from any
liability which it may have to any indemnified party
otherwise than under subsection (a) or (b) above. In case
any such action is brought against any indemnified party and
it notifies the indemnifying party of the commencement
thereof, the indemnifying party will be entitled to
participate therein and, to the extent that it may wish,
jointly with any other indemnifying party similarly
notified, to assume the defense thereof, with counsel
reasonably satisfactory to such indemnified party, and
after notice from the indemnifying party to such indemnified
party of its election so to assume the defense thereof, the
indemnifying party will not be liable to such indemnified
party under this Section 7 for any legal or other expenses
subsequently incurred by such indemnified party in
connection with the defense thereof other than reasonable
costs of investigation; provided, however, that the
indemnified party shall have the right to employ counsel to
represent the indemnified party and its controlling persons
who may be subject to liability arising out of any claim in
respect of which indemnity may be sought by the indemnified
party against the indemnifying party under this Section 7 if
the employment of such counsel shall have been authorized in
writing by the indemnifying party in connection with the
defense of such action or, if in the written opinion of
counsel to either the indemnifying party or the indemnified
party, representation of both parties by the same counsel
would be inappropriate due to actual or likely conflicts of
interest between them, and in that event the fees and
expenses of one firm of separate counsel (in addition to the
fees and expenses of local counsel) shall be paid by the
indemnifying party. No indemnifying party shall, without
the prior written consent of the indemnified party (which
consent shall not be unreasonably withheld), effect any
settlement of any pending or threatened action in respect of
which any indemnified party is or could have been a party
and indemnity could have been sought hereunder by such
indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all
liability on any claims that are the subject matter of such
action.
(d) If the indemnification provided for in this
Section 7 is unavailable or insufficient to hold harmless an
indemnified party under subsection (a) or (b) above, then
each indemnifying party shall contribute to the amount paid
or payable by such indemnified party as a result of the
losses, claims, damages or liabilities referred to in
subsection (a) or (b) above (i) in such proportion as is
appropriate to reflect the relative benefits received by the
Funding Corporation and the Guarantors on the one hand and
the Purchasers on the other from the offering of the Securi
ties or (ii) if the allocation provided by clause (i) above
is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault
of the Funding Corporation and the Guarantors on the one
hand and the Purchasers on the other in connection with the
statements or omissions which resulted in such losses,
claims, damages or liabilities as well as any other relevant
equitable considerations. The relative benefits received by
the Funding Corporation and the Guarantors on the one hand
and the Purchasers on the other shall be deemed to be in the
same proportion as the total net proceeds from the offering
(before deducting expenses) received by the Funding
Corporation and the Guarantors bear to the total discounts
and commissions received by the Purchasers from the Funding
Corporation under this Agreement. The relative fault shall
be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or
the omission or alleged omission to state a material fact
relates to information supplied by the Funding Corporation
or the Guarantors, on the one hand, or the Purchasers, on
the other hand, and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent
such untrue statement or omission. The amount paid by an
indemnified party as a result of the losses, claims, damages
or liabilities referred to in the first sentence of this
subsection (d) shall be deemed to include any legal or other
expenses reasonably incurred by such indemnified party in
connection with investigating or defending any action or
claim which is the subject of this subsection (d).
Notwithstanding the provisions of this subsection (d), no
Purchaser shall be required to contribute any amount in
excess of the amount by which the total price at which the
Securities purchased by it were resold exceeds the amount of
any damages which such Purchaser has otherwise been required
to pay by reason of such untrue or alleged untrue statement
or omission or alleged omission.
(e) The obligations of the Funding Corporation
and the Guarantors under this Section 7 shall be in addition
to any liability which the Funding Corporation and the
Guarantors may otherwise have and shall extend, upon the
same terms and conditions, to each person, if any, who con
trols any Purchaser within the meaning of the Securities Act
or the Exchange Act; and the obligations of the Purchasers
under this Section shall be in addition to any liability
which the respective Purchasers may otherwise have and shall
extend, upon the same terms and conditions, to each officer,
director, employee, agent or shareholder of the Funding
Corporation and each Guarantor and to each officer,
director, employee, agent or shareholder of each person, if
any, who controls the Funding Corporation and the Guarantors
within the meaning of the Securities Act or the Exchange
Act.
8. Default by Purchasers. If any Purchaser defaults
in its obligations to purchase Securities hereunder and the
aggregate principal amount of Securities that such
defaulting Purchaser agreed but failed to purchase does not
exceed 10% of the total principal amount of Securities, the
remaining Purchaser may make arrangements satisfactory to
the Funding Corporation for the purchase of such Securities
by other persons, including itself, but if no such
arrangements are made by the Closing Date, the non-
defaulting Purchaser shall be obligated to purchase the
Securities that such defaulting Purchaser agreed but failed
to purchase. If any Purchaser so defaults and the aggregate
principal amount of Securities with respect to which such
default occurs exceeds 10% of the total principal amount of
Securities and arrangements satisfactory to the remaining
Purchaser and the Funding Corporation for the purchase of
such Securities by other persons are not made within 36
hours after such default, this Agreement will terminate
without liability on the part of the non-defaulting
Purchaser or the Funding Corporation, except as provided in
Section 9. As used in this Agreement, the term "Purchaser"
includes any person substituted for a Purchaser under this
Section. Nothing herein will relieve a defaulting Purchaser
from liability for its default.
9. Survival of Certain Representations and
Obligations. The respective indemnities, agreements,
representations, warranties and other statements of the
Funding Corporation and the Guarantors or their officers and
of the Purchaser set forth in or made pursuant to this
Agreement will remain in full force and effect, regardless
of any investigation, or statement as to the results
thereof, made by or on behalf of the Purchaser, the Funding
Corporation and the Guarantors or any of their respective
representatives, officers or directors or any controlling
person, and will survive delivery of and payment for the
Securities. If for any reason the purchase of the Securi
ties by the Purchaser is not consummated, the Funding
Corporation and the Guarantors shall remain responsible for
the expenses to be paid or reimbursed by them pursuant to
Section 5 and the respective obligations of the Funding
Corporation, the Guarantors and the Purchaser pursuant to
Section 7 shall remain in effect; provided that,
notwithstanding the foregoing, in such circumstances the
Funding Corporation and the Guarantors shall not be
obligated to reimburse the Purchaser for its out-of-pocket
expenses (excluding fees and disbursements of counsel and
rating agency fees) in excess of $175,000; and provided,
further that if the purchase of the Securities is not
consummated solely because of the occurrence of an event
specified in Section 6(b)(iv), (v) or (vi), then the Funding
Corporation and the Guarantors shall have no obligation to
reimburse the Purchaser for its out-of-pocket expenses
(including fees and disbursements of counsel), except for
rating agency fees.
10. Notices. All communications hereunder will be in
writing and, if sent to the Purchaser will be mailed,
delivered or telegraphed and confirmed to the Purchaser, at
Credit Suisse First Boston Corporation, Eleven Madison
Avenue, New York, New York 10010, Attention: Investment
Banking Department-Transactions Advisory Group, or, if sent
to the Funding Corporation and the Guarantors, will be
mailed, delivered or telegraphed and confirmed to them at
302 South 36th Street, Suite 400-A, Omaha, Nebraska 68131,
Attention: General Counsel.
11. Successors. This Agreement will inure to the
benefit of and be binding upon the parties hereto and their
respective successors and the controlling persons referred
to in Section 7, and no other person will have any right or
obligation hereunder.
12. Representation of Purchasers. CSFBC will act for
the several Purchasers in connection with this purchase, and
any action under this Agreement taken by CSFBC will be
binding upon all the Purchasers.
13. Counterparts. This Agreement may be executed in
any number of counterparts, each of which shall be deemed to
be an original, but all such counterparts shall together
constitute one and the same Agreement.
14. Applicable Law. This Agreement shall be governed
by, and construed in accordance with, the laws of the State
of New York without regard to principles of conflicts of
laws (other than Section 5-1401 of the New York General
Obligations Law). The Funding Corporation and the
Guarantors hereby submit to the non-exclusive jurisdiction
of the federal and state courts in the Borough of Manhattan
in The City of New York in any suit or proceeding arising
out of or relating to this Agreement or the transactions
contemplated hereby.
If the foregoing is in accordance with the
Purchaser's understanding of our agreement, kindly sign and
return to us one of the counterparts hereof, whereupon it
will become a binding agreement between the Funding
Corporation, each of the Guarantors and the Purchaser in
accordance with its terms.
Very truly yours,
SALTON SEA FUNDING CORPORATION
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
SALTON SEA BRINE PROCESSING L.P.
By: SALTON SEA POWER COMPANY, as
Managing General Partner
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
SALTON SEA POWER GENERATION L.P.
By: SALTON SEA POWER COMPANY, as
Managing General Partner
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
FISH LAKE POWER COMPANY
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
SALTON SEA POWER L.L.C.
By: CE SALTON SEA INC., as Manager
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
CALENERGY OPERATING
CORPORATION
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
VULCAN POWER COMPANY
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
NIGUEL ENERGY COMPANY
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
SAN FELIPE ENERGY COMPANY
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
CONEJO ENERGY COMPANY
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
BN GEOTHERMAL, INC.
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
ELMORE, L.P.
By: CALENERGY OPERATING COR
PORATION, as General Partner
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
LEATHERS, L.P.
By: CALENERGY OPERATING
CORPORATION,
as General Partner
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
DEL RANCH, L.P.
By: CALENERGY OPERATING
CORPORATION, as General
Partner
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
VULCAN/BN GEOTHERMAL POWER COMPANY
By: VULCAN POWER COMPANY,
as General Partner
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
CALENERGY MINERALS LLC
By: SALTON SEA MINERALS CORP., as
Manager
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
CE TURBO LLC
By: MAGMA POWER COMPANY, as
Manager
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
SALTON SEA ROYALTY COMPANY
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
SECURITIES AND EXCHANGE COMMISSION
EXHIBIT 4.10(a)
AMENDMENT TO NOTES AND TO AMENDED AND RESTATED DEBT
SERVICE RESERVE LETTER OF CREDIT AND REIMBURSEMENT
AGREEMENT
This AMENDMENT TO NOTES AND TO AMENDED AND
RESTATED DEBT SERVICE RESERVE LETTER OF CREDIT AND
REIMBURSEMENT AGREEMENT dated as of October 13, 1998
(this "Amendment") by and among SALTON SEA FUNDING
CORPORATION, a Delaware corporation (the "Borrower");
CREDIT SUISSE FIRST BOSTON, New York Branch (formerly
known as Credit Suisse)(in its individual capacity as
"Initial Bank"); CREDIT SUISSE FIRST BOSTON, New York
Branch (formerly known as Credit Suisse), DRESDNER BANK,
A.G., New York Branch, PARIBAS (formerly known as Banque
Paribas), New York Branch and THE FUJI BANK, LIMITED
(each a "Bank" and collectively the "Banks"); and CREDIT
SUISSE FIRST BOSTON, New York Branch (formerly known as
Credit Suisse), as Agent (in such capacity, together with
its successors in such capacity, the "Agent") for the
Banks.
W I T N E S S E T H :
WHEREAS, Pursuant to an Indenture dated as of
July 21, 1995 (as amended, supplemented or modified by
the First Supplemental Indenture dated as of October 18,
1995, the Second Supplemental Indenture dated as of June
20, 1996, the Third Supplemental Indenture dated as of
July 29, 1996 and the Supplemental Indenture referred to
below, the "Indenture") among the Borrower and Chase
Manhattan Bank and Trust Company, National Association,
as trustee (in such capacity, together with its
successors in such capacity, the "Trustee"), the Borrower
has authorized the creation of issues of nonrecourse
bonds, debentures, promissory notes and other evidences
of indebtedness to be issued in one or more series
(collectively, the "Securities"), the sale proceeds of
which are to be advanced to the Borrower pursuant to the
Indenture.
WHEREAS, the Borrower and the Trustee have
entered into that certain Fourth Supplemental Indenture
dated as of October 13, 1998 (the "Supplemental
Indenture") to provide for the issuance of one additional
series of bonds in accordance with Article 2 of the
Indenture.
WHEREAS, on July 21, 1995 and on June 20, 1996
the Borrower issued securities (the "Existing
Securities") under the Indenture. On the date of this
Amendment, pursuant to the terms of the Supplemental
Indenture, the Borrower will issue the additional
securities described therein (the "Offered Securities").
WHEREAS, in connection with the issuance of the
Existing Securities, the Borrower and the Initial Bank
entered into the Amended and Restated Debt Service
Reserve Letter of Credit and Reimbursement Agreement
dated as of June 20, 1996, together with a Supplement
dated concurrently therewith (the "Agreement") pursuant
to which the Initial Bank issued a letter of credit (the
"Original Debt Service Reserve Letter of Credit").
WHEREAS, in connection with the issuance of the
Offered Securities, the Borrower has requested that the
Banks increase the Commitment and that the Initial Bank
issue and exchange for the Original Debt Service Reserve
Letter of Credit, and the Banks participate in, and
Initial Bank is willing to issue and the Banks are
willing to participate in, the Debt Service Reserve
Letter of Credit upon the terms and conditions
hereinafter set forth, it being the intention of the
Banks to amend and modify the Agreement as herein
provided.
NOW, THEREFORE, in consideration of the
foregoing, and subject to the terms and conditions herein
set forth, the parties hereto agree as follows:
A. Definitions.
Terms used in the preamble and recitals and
capitalized terms used herein, and not otherwise defined
herein, shall have the meanings assigned to them in the
Agreement.
B. Amendments
1. The definition of "Outstanding Amount" is
hereby amended and restated to read in its entirety as
follows:
"'Outstanding Amount' means, for any
applicable period, the amount for such period
set forth in Annex I or, at any time that the
interest rate on the Securities has been
adjusted pursuant to Section 2.2(b) of the
Indenture, Annex II hereto, as the case may
be, in the column under the caption 'Total
Commitments,' and as the same may be reduced,
increased or reinstated from time to time in
accordance with the terms and provisions
hereof."
2. Each of the Banks hereby consents to the
incorporation pursuant to Section 1.1 of the Agreement of
amendments to definitions under the Indenture as set
forth in the Supplemental Indenture which is attached
hereto as Exhibit 1. Section 1.1(a) is hereby amended by
adding the following sentence at the end thereof:
"The following terms have the meanings
assigned to them in the Depository Agreement:
'Debt Service Reserve Required Balance',
'Debt Service Reserve Fund', 'Interest
Payment Date', 'Principal Fund' and
'Principal Payment Date'.
3. Section 2.1 is hereby amended by deleting
the words "opposite such Bank's name on the signature
pages hereof" in the sixth line of such section and
substituting therefor "in Annex I or Annex II hereto, as
applicable". Annex I hereto is hereby added to the
Amended and Restated Debt Service Reserve Letter of
Credit and Reimbursement Agreement as Annex I. Annex II
hereto is hereby added to the Amended and Restated Debt
Service Reserve Letter of Credit and Reimbursement
Agreement as Annex II.
4. Section 2.2(a) is hereby amended by
deleting the amount "$70,430,000" in the sixth line
thereof and substituting therefor "69,053,313". Section
2.2(a) is hereby further amended by deleting the words
"Closing Date" in the two places they appear and
substituting therefore "October 13, 1998". Section
2.2(a) is hereby further amended by adding the following
sentence at the end thereof:
"Within each period set forth in Annex I
or Annex II, as applicable, neither the
Commitment of any Bank nor the total
Commitments shall exceed that set forth
for each such Bank or the total
Commitments, respectively, in each such
period."
5. Section 2.2(e) is hereby amended by
deleting the amount "$70,429,065" in the eighth line
thereof and substituting therefor "$69,053,313".
6. Section 2.3 is hereby amended by adding
the following new paragraph to the end of such section:
"In order to maintain the anticipated
reductions in the Commitment of The Fuji Bank,
Limited, prior to the issuance of the Offered
Securities and related amendments to the Financing
Documents resulting therefrom, the Commitment and
Commitment percentages for each Bank shall be as set
forth in Annex I or Annex II, as applicable, hereto
for each respective period described therein."
7. Section 2.5(c) is hereby amended by adding
the following to the end of such section:
"in addition, for the period from and
including December 1, 1998 to and including
December 31, 1999, the Borrower shall pay to
the Agent for the respective accounts of the
Banks, quarterly in arrears on the same
payment dates described in the immediately
preceding clause, a fee equal to that
described in the letter from the Borrower to
the Agent dated June 20, 1996."
8. Section 2.6(a) is hereby amended by
correcting "3.5(j)" to read "3.5(i)".
9. Section 2.7(f) is hereby amended by
deleting the word "Bonds" and substituting therefor
"Securities".
10. Section 2.8(c) is hereby amended by
deleting clauses (i) and (ii) thereof and substituting
therefor "on a pro-rata basis among all such Loans.
11. Section 6.1(i) is hereby amended by adding
"(d)" between "(c)" and "(e)" in the fifth line thereof.
12. Section 9.1 is hereby amended by deleting
the word "or" at the end of clause (d)(ii), substituting
a "," therefor and adding the following clause (d)(iv)
after (d)(iii): "or (iv) reduction in Commitments set
forth in Annex I or Annex II hereto".
13. Section 9.2 is hereby amended by deleting
the address (i) "One Liberty Plaza, 165 Broadway, New
York, New York 10006, telephone (212) 238-2000,
telecopier (212) 238-2121" and replacing it with "5 World
Trade Center, 8th Floor, New York, New York 10048,
telephone (212) 322-0047, telecopier (212) 803-2079" and
(ii) by deleting the address "12 East 49th Street, 43rd
Floor, New York, New York, 10017, telephone (212) 238-
2000, telecopier (212) 238-5350" and replacing it with
"Eleven Madison Avenue, New York, New York, 10010,
telephone (212) 325-2000, telecopier (212) 325-8049"
14. Exhibit A is hereby amended and
restated in its entirety to read as Exhibit A
hereto.
15. Clause (i) of the first paragraph of the
Note issued on September 13, 1996 to Credit Suisse is
hereby amended in its entirety to read as follows:
"The principal sum of Twenty Five Million Three
Hundred Thirty Thousand Seven Hundred Seventy Three
dollars ($25,330,773) and".
16. Clause (i) of the first paragraph of the
Note issued on September 13, 1996 to Dresdner Bank A.G.,
New York Branch, is hereby amended in its entirety to
read as follows:
"The principal sum of Twenty Million Eight
Hundred Sixty Nine Thousand Four Hundred Seventy One
dollars ($20,869,471) and".
17. Clause (i) of the first paragraph of the
Note issued on September 13, 1996 to Paribas (formerly
known as Banque Paribas), New York Branch is hereby
amended in its entirety to read as follows:
"The principal sum of Sixteen Million Eight
Hundred Fifty Five Thousand Eight Hundred Eighty Seven
dollars ($16,855,887) and".
18. Clause (i) of the first paragraph of the
Note issued on September 13, 1996 to The Fuji Bank,
Limited, is hereby amended in its entirety to read as
follows:
"The principal sum of Nine Million Six Hundred
Ninety Seven Thousand Two Hundred Seventy Eight dollars
($9,697,278) and".
19. Pursuant to Section 8.1 of the Agreement,
each Bank hereby authorizes and instructs the Agent to
execute the Second Amendment to the Collateral Agency and
Intercreditor Agreement substantially in the form
attached hereto as Exhibit 2.
C. Conditions Precedent.
The obligation of the Initial Bank to issue the Debt
Service Reserve Letter of Credit and the effectiveness of
this Amendment is subject to the following conditions
precedent:
(a) The Agent shall have received the
following, each dated on or before the date of this
Amendment, unless otherwise specified below, in form
and substance satisfactory to the Agent and in the
number of originals or photostatic copies reasonably
required by the Agent:
(i) this Amendment, duly executed by the
Borrower and the Banks;
(ii) The Supplemental Indenture, as
amended, supplemented or modified, duly
executed by the parties thereto, in form and
substance reasonably satisfactory to the Agent;
(iii) the Amended and Restated Deposit and
Disbursement Agreement, dated as of October 13,
1998, duly executed by the parties thereto, in
form and substance reasonably satisfactory to
the Agent;
(iv) the Second Amendment, dated as of
October 13, 1998, to the Intercreditor
Agreement, duly executed by the parties
thereto, in form and substance reasonably
satisfactory to the Agent;
(v) the Second Agreement Regarding
Security Documents, dated as of October 13,
1998, duly executed by the parties thereto, in
form and substance reasonably satisfactory to
the Agent;
(vi) written opinions of counsel, as to
such matters as the Agent may reasonably
request, in form and substance satisfactory to
the Agent; and
(vii) a certificate of the Depositary Agent
as to the incumbency and specimen signatures of
the officers of the Depositary Agent authorized
to make drawings, to execute and present
certificates under the Debt Service Reserve
Letter of Credit, and otherwise communicate
with the Agent with respect thereto;
(b) all agreements referred to in Sections
3.1(a)(ii), (iii) and (iv) remain in full force and
effect and any conditions precedent to the
amendments or supplements referred to therein shall
have been satisfied;
(c) the Borrower shall have paid to the Agent
for the benefit of Credit Suisse First Boston, New
York Branch, Dresdner Bank, A.G., New York Branch
and Paribas, (formerly known as Banque Paribas), New
York Branch $50,841, $58,497 and $47,247,
respectively, as an amendment fee;
(d) the Borrower shall have paid all accrued
fees and expenses (as provided in Sections 2.5 and
9.4 of the Agreement) of the Agent and the Banks
(including the reasonable accrued fees and
disbursements of counsel to the Agent and the
Banks), to the extent that one or more statements
for such fees and expenses have been presented for
payment;
(e) (i) all conditions precedent under the
Purchase Agreement, dated October 7, 1998, have been
satisfied;
(ii) not less than $285,000,000 (less
underwriting fees and transaction costs) in proceeds
from the Offered Securities shall have been received
by the Borrower thereunder; and
(iii) the Offered Securities shall have
received investment grade ratings from both Rating
Agencies;
(f) no Default or Event of Default shall have
occurred and be continuing;
(g) all agreements and documents the delivery
of which was made a condition precedent to issuance
of the Debt Service Reserve Letter of Credit, as
they may have been amended, supplemented or
modified, remain in full force and effect except as
contemplated herein or as otherwise required by the
transactions contemplated herein;
(h) the Agent shall have received for
cancellation, on or before the date of this
Amendment, the Original Debt Service Reserve Letter
of Credit;
(i) the Agent shall have received certified
copies of the charter and bylaws of the Borrower or,
in lieu thereof, a certificate from the Secretary of
the Borrower certifying that such documents
previously delivered to the Agent are true, correct
and complete as of the date hereof;
(j) the Agent shall have received a
certificate from the Secretary of the Borrower in
respect of all corporate action taken by the
Borrower in approving the execution, delivery and
performance of this Amendment and stating that the
resolutions previously adopted which authorized and
approved the execution, delivery and performance of
the Agreement are in full force and effect and have
not been amended, rescinded or otherwise modified;
(k) the Agent shall have received a
certificate of the Secretary of the Borrower which
certifies the names and offices of the officers of
the Borrower who are authorized to sign this
Amendment, together with the true signatures of such
officers;
(l) the Agent shall have received a good
standing certificate with respect to the Borrower,
as of a recent date prior to the effective date of
this Amendment, from the Secretary of State of each
of Delaware and California; and
(m) the Agent shall have received such other
approvals, opinions, evidence and documents as it
may reasonably request and which are customary for
transactions of the type contemplated by this
Amendment.
D. Representations and Warranties.
In order to induce the Agent, the Initial Bank
and the Banks to enter into this Amendment, the Borrower
represents and warrants to the Agent, the Initial Bank
and the Banks that (a) the execution, delivery and
performance of this Amendment and the documents
contemplated hereby are within the Borrower's power, have
been duly authorized by all necessary or proper action,
are not in contravention of, do not result in a breach
of, or constitute (with due notice or lapse of time or
both) a default under, any contractual obligation to
which the Borrower is a party or by which the property of
the Borrower is bound, do not and will not result in or
require the creation or imposition of any material Lien
upon any of the properties or assets of the Borrower, are
not in contravention of any provision of any law, do not
require the consent or approval of any governmental body,
agency, authority or any other person that has not been
obtained and a copy thereof furnished to the Agent, and
(b) no Event of Default or Default exists as of the date
hereof and no Event of Default or Default would result
from the execution, delivery or consummation of the
transactions contemplated by this Amendment.
The Borrower hereby makes for the benefit of
the Agent and the Banks all of the representations and
warranties of the Borrower made in the Indenture, in the
form of such representations and warranties as they exist
on the date of this Amendment and as they may hereafter
be amended from time to time, but only to the extent that
the incorporation of any such amendments has been
consented to in accordance with Section 9.1 of the
Agreement. Such representations and warranties are
incorporated herein by reference as if set forth at
length in this Amendment; provided that any reference to
the Funding Corporation shall be deemed to be a reference
to Borrower; each reference to the term "Securities"
shall be deemed to include the Obligations; and each
reference to the term "Indenture" shall be deemed to be a
reference to the Agreement, as amended by this Amendment.
E. Miscellaneous.
1. This Amendment shall be subject to the
provisions of Section 9.1 of the Agreement. Without
limiting the generality of the foregoing, all of the
terms and conditions of the Agreement shall remain in
full force and effect except as specifically set forth
herein. The Agreement shall, as the context so requires,
be read and construed throughout so as to incorporate
this Amendment. All references to the Agreement in the
Notes shall be deemed to include the Agreement as amended
by this Amendment.
2. Each of the agreements and amendments set
forth herein shall be effective only in the specific
instances described herein and for the specific purpose
for which it was given, and nothing contained herein
shall be construed to limit or bar any rights or remedies
of the undersigned which they may have on any other
occasion.
3. The Borrower reaffirms its obligations
(pursuant to Section 9.4 of the Agreement) and agrees to
pay, on the date hereof or promptly thereafter, the
reasonable costs and expenses (including attorneys' fees
and expenses) incurred by the Agent in connection with
the consummation of the transactions contemplated under
this Amendment, including, without limitation, the
negotiation, preparation, execution and delivery of this
Amendment and all other related documents.
4. THIS AMENDMENT SHALL BE GOVERNED BY AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF NEW YORK WITHOUT REGARD TO THE PRINCIPLES OF
CONFLICTS OF LAW.
5. This Amendment may be executed in any
number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed and
delivered shall be deemed an original, but all of which
counterparts together shall constitute but one and the
same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be duly executed by their respective officers
thereunto duly authorized, as of the day and year first above
written, and by their signature evidence their consent to the
effectiveness of the modifications and amendments to the
provisions of the Agreement which are made herein, and further,
consent to the modifications and amendments to Schedule I to the
Depositary Agreement as they shall be in effect on the date
hereof.
SALTON SEA FUNDING CORPORATION
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
CREDIT SUISSE FIRST BOSTON,
New York Branch
(formerly known as Credit
Suisse), as Agent, Initial Bank
and as a Bank
By:
Name:
Title:
By:
Name:
Title:
DRESDNER BANK AG, New York Branch,
as a Bank
By:
Name:
Title:
By:
Name:
Title:
PARIBAS
(formerly known as Banque Paribas)
New York Branch,
as a Bank
By:
Name:
Title:
By:
Name:
Title:
THE FUJI BANK, LIMITED,
as a Bank
By:
Name:
Title:
By:
Name:
Title:
EXHIBIT 4.13 (a)
SALTON SEA PROJECT NOTE (SSI)
$246,483,000 October ___, 1998
For value received, the undersigned, SALTON SEA POWER
GENERATION L.P., a California limited partnership, SALTON SEA
BRINE PROCESSING L.P., a California limited partnership, FISH
LAKE POWER COMPANY, a Delaware corporation, and SALTON SEA POWER
L.L.C., a Delaware limited liability company (collectively, the
"Salton Sea Guarantors"), by this promissory note jointly and
severally promise to pay to the order of Salton Sea Funding
Corporation, a Delaware corporation ("Funding Corporation"), at
the office of Chase Manhattan Bank and Trust Company, National
Association, a national banking association organized under the
laws of the United States, located at 101 California Street,
Number 2725, San Francisco, California 94111, in lawful currency
of the United States of America and in immediately available
funds, the principal amount of $246,483,000, or if less, the
aggregate unpaid and outstanding principal amount of this Salton
Sea Project Note advanced by Funding Corporation to the Salton
Sea Guarantors pursuant to that certain Amended and Restated
Credit Agreement (the "Salton Sea Credit Agreement"), dated as of
the date hereof by and among the Salton Sea Guarantors and
Funding Corporation, and as the same may be amended from time to
time, and all other amounts owed by the Salton Sea Guarantors to
Funding Corporation hereunder.
This Salton Sea Project Note is entered into pursuant
to the Salton Sea Credit Agreement and is entitled to the
benefits thereof and is subject to all terms, provisions and
conditions thereof. Capitalized terms used and not defined
herein shall have the meanings set forth in Exhibit A to that
certain Trust Indenture, dated as of July 21, 1995 (as the same
may be amended, modified or supplemented, including pursuant to
the First Supplemental Indenture dated as of October 18, 1995,
the Second Supplemental Indenture dated as of June 20, 1996, the
Third Supplemental Indenture dated as of July 29, 1996, and the
Fourth Supplemental Indenture dated as of the date hereof, the
"Indenture"), by and between Funding Corporation and Chase
Manhattan Bank and Trust Company, National Association, a
national banking association organized under the laws of the
United States, successor in interest to Chemical Trust Company of
California, as trustee.
Reference is hereby made to the Salton Sea Credit
Agreement, the Indenture and the Security Documents for the
provisions, among others, with respect to the custody and
application of the Collateral, the nature and extent of the
security provided thereunder, the rights, duties and obligations
of the Salton Sea Guarantors and the rights of the holder of this
Salton Sea Project Note.
The principal amount hereof is payable in accordance
with the Salton Sea Credit Agreement, and such principal amount
may be prepaid solely in accordance with the Salton Sea Credit
Agreement.
The Salton Sea Guarantors further agree to pay, in
lawful currency of the United States of America and in
immediately available funds, interest from the date hereof on the
unpaid and outstanding principal amount hereof until such unpaid
and outstanding principal amount shall become due and payable
(whether at stated maturity, by acceleration or otherwise) at the
rates of interest and at the times set forth in the Salton Sea
Credit Agreement, and the Salton Sea Guarantors agree to pay
other fees and costs as stated in the Salton Sea Credit
Agreement.
Upon the occurrence of any one or more Credit Agreement
Events of Default (as defined in Section 5.1 of the Salton Sea
Credit Agreement), all amounts then remaining unpaid under this
Salton Sea Project Note may become or be declared to be
immediately due and payable as provided in the Salton Sea Credit
Agreement, without notice of default, presentment or demand for
payment, protest or notice of nonpayment or dishonor, or notices
or demands of any kind, all of which are expressly waived by the
Salton Sea Guarantors.
The obligations hereunder are subject to the
limitations set forth in Section 6.11 of the Salton Sea Credit
Agreement, the provisions of which are hereby incorporated by
reference.
This Salton Sea Project Note shall be construed and
interpreted in accordance with and governed by the laws of the
State of California without regard to the conflicts of laws rules
thereof.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
SALTON SEA POWER GENERATION L.P.,
a
California limited partnership
By:
SALTON SEA POWER COMPANY,
a
Nevada corporation, its general
partner
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
SALTON SEA BRINE PROCESSING L.P.,
a
California limited partnership
By:
SALTON SEA POWER COMPANY,
a
Nevada corporation, its general
partner
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
FISH LAKE POWER COMPANY,
a Delaware
corporation
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
SALTON SEA POWER L.L.C.,
a Delaware limited liability
company
By: CE SALTON SEA INC.,
a Delaware corporation, its
manager
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
EXHIBIT 4.13(b)
SALTON SEA PROJECT NOTE (SSIII)
$83,272,000 October ___, 1998
For value received, the undersigned, SALTON SEA POWER
GENERATION L.P., a California limited partnership, SALTON SEA
BRINE PROCESSING L.P., a California limited partnership, FISH
LAKE POWER COMPANY, a Delaware corporation, and SALTON SEA POWER
L.L.C., a Delaware limited liability company (collectively, the
"Salton Sea Guarantors"), by this promissory note jointly and
severally promise to pay to the order of Salton Sea Funding
Corporation, a Delaware corporation ("Funding Corporation"), at
the office of Chase Manhattan Bank and Trust Company, National
Association, a national banking association organized under the
laws of the United States, located at 101 California Street,
Number 2725, San Francisco, California 94111, in lawful currency
of the United States of America and in immediately available
funds, the principal amount of $83,272,000, or if less, the
aggregate unpaid and outstanding principal amount of this Salton
Sea Project Note advanced by Funding Corporation to the Salton
Sea Guarantors pursuant to that certain Amended and Restated
Credit Agreement (the "Salton Sea Credit Agreement"), dated as of
the date hereof by and among the Salton Sea Guarantors and
Funding Corporation, and as the same may be amended from time to
time, and all other amounts owed by the Salton Sea Guarantors to
Funding Corporation hereunder.
This Salton Sea Project Note is entered into pursuant
to the Salton Sea Credit Agreement and is entitled to the
benefits thereof and is subject to all terms, provisions and
conditions thereof. Capitalized terms used and not defined
herein shall have the meanings set forth in Exhibit A to that
certain Trust Indenture, dated as of July 21, 1995 (as the same
may be amended, modified or supplemented, including pursuant to
the First Supplemental Indenture dated as of October 18, 1995,
the Second Supplemental Indenture dated as of June 20, 1996, the
Third Supplemental Indenture dated as of July 29, 1996, and the
Fourth Supplemental Indenture dated as of the date hereof, the
"Indenture"), by and between Funding Corporation and Chase
Manhattan Bank and Trust Company, National Association, a
national banking association organized under the laws of the
United States, successor in interest to Chemical Trust Company of
California, as trustee.
Reference is hereby made to the Salton Sea Credit
Agreement, the Indenture and the Security Documents for the
provisions, among others, with respect to the custody and
application of the Collateral, the nature and extent of the
security provided thereunder, the rights, duties and obligations
of the Salton Sea Guarantors and the rights of the holder of this
Salton Sea Project Note.
The principal amount hereof is payable in accordance
with the Salton Sea Credit Agreement, and such principal amount
may be prepaid solely in accordance with the Salton Sea Credit
Agreement.
The Salton Sea Guarantors further agree to pay, in
lawful currency of the United States of America and in
immediately available funds, interest from the date hereof on the
unpaid and outstanding principal amount hereof until such unpaid
and outstanding principal amount shall become due and payable
(whether at stated maturity, by acceleration or otherwise) at the
rates of interest and at the times set forth in the Salton Sea
Credit Agreement, and the Salton Sea Guarantors agree to pay
other fees and costs as stated in the Salton Sea Credit
Agreement.
Upon the occurrence of any one or more Credit Agreement
Events of Default (as defined in Section 5.1 of the Salton Sea
Credit Agreement), all amounts then remaining unpaid under this
Salton Sea Project Note may become or be declared to be
immediately due and payable as provided in the Salton Sea Credit
Agreement, without notice of default, presentment or demand for
payment, protest or notice of nonpayment or dishonor, or notices
or demands of any kind, all of which are expressly waived by the
Salton Sea Guarantors.
The obligations hereunder are subject to the
limitations set forth in Section 6.11 of the Salton Sea Credit
Agreement, the provisions of which are hereby incorporated by
reference.
This Salton Sea Project Note shall be construed and
interpreted in accordance with and governed by the laws of the
State of California without regard to the conflicts of laws rules
thereof.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
SALTON SEA POWER GENERATION L.P.,
a
California limited partnership
By:
SALTON SEA POWER COMPANY,
a
Nevada corporation, its general
partner
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
SALTON SEA BRINE PROCESSING L.P.,
a
California limited partnership
By:
SALTON SEA POWER COMPANY,
a
Nevada corporation, its general
partner
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
FISH LAKE POWER COMPANY,
a Delaware
corporation
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
SALTON SEA POWER L.L.C.,
a Delaware limited liability
company
By: CE SALTON SEA INC.,
a Delaware corporation, its
manager
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
EXHIBIT 4.14(c)
AMENDED AND RESTATED DEPOSIT AND DISBURSEMENT AGREEMENT
among
SALTON SEA FUNDING CORPORATION,
SALTON SEA BRINE PROCESSING L.P.,
SALTON SEA POWER GENERATION L.P.,
FISH LAKE POWER COMPANY,
SALTON SEA POWER L.L.C.,
VULCAN POWER COMPANY,
CALIFORNIA ENERGY OPERATING CORPORATION,
BN GEOTHERMAL, INC.,
SAN FELIPE ENERGY COMPANY,
CONEJO ENERGY COMPANY,
NIGUEL ENERGY COMPANY,
VULCAN/BN GEOTHERMAL POWER COMPANY,
DEL RANCH, L.P.,
ELMORE, L.P.,
LEATHERS, L.P.,
CALENERGY MINERALS LLC,
CE TURBO LLC,
SALTON SEA ROYALTY COMPANY,
and
Chase Manhattan Bank and Trust Company, National Association,
as Collateral Agent
and
Chase Manhattan Bank and Trust Company, National Association,
as Depositary Agent
Dated as of October 13, 1998
AMENDED AND RESTATED DEPOSIT AND DISBURSEMENT
AGREEMENT (this "Depositary Agreement"), dated as of
October 13, 1998, among Salton Sea Funding Corporation, a
Delaware corporation (the "Funding Corporation"), Salton
Sea Brine Processing L.P., a California limited
partnership ("SSBP"), Salton Sea Power Generation L.P., a
California limited partnership ("SSPG"), Fish Lake Power
Company, a Delaware corporation ("Fish Lake"), Salton Sea
Power L.L.C., a Delaware limited liability company
("Power LLC" and, collectively with SSBP, SSPG and Fish
Lake, the "Salton Sea Guarantors"), Vulcan Power Company,
a Nevada corporation ("VPC"), California Energy Operating
Corporation, a Delaware corporation ("CEOC"), BN
Geothermal, Inc., a Nevada corporation ("BN Geothermal"),
San Felipe Energy Company, a California corporation ("San
Felipe"), Conejo Energy Company, a California corporation
("Conejo"), Niguel Energy Company, a California
corporation ("Niguel"), Vulcan/BN Geothermal Power
Company, a Nevada general partnership ("Vulcan"), Del
Ranch, L.P., a California limited partnership ("Del
Ranch"), Elmore, L.P., a California limited partnership
("Elmore"), Leathers, L.P., a California limited
partnership ("Leathers"), CalEnergy Minerals LLC, a
Delaware limited liability company ("Minerals LLC"), and
CE Turbo LLC, a Delaware limited liability company
("Turbo LLC" and, collectively with VPC, CEOC, BN
Geothermal, San Felipe, Conejo, Niguel, Vulcan, Del
Ranch, Elmore, Leathers and Minerals LLC, the
"Partnership Guarantors"), Salton Sea Royalty Company, a
Delaware corporation (the "Royalty Guarantor" and, collec
tively with the Salton Sea Guarantors and the Partnership
Guarantors, the "Guarantors"), Chase Manhattan Bank and
Trust Company, National Association, in its capacity as
collateral agent (together with its successors and
permitted assigns in such capacity, the "Collateral
Agent"), and Chase Manhattan Bank and Trust Company,
National Association, in its capacity as depositary agent
(together with its successors and permitted assigns in
such capacity, the "Depositary Agent").
WHEREAS, the Funding Corporation was formed for
the sole purpose of issuing its bonds, debentures,
promissory notes or other evidences of indebtedness under
the Trust Indenture dated as of July 21, 1995 (the
"Original Indenture") (as amended and supplemented by the
First Supplemental Indenture dated as of October 18,
1995, the Second Supplemental Indenture dated as of June
20, 1996 (the "Second Supplemental Indenture"), the Third
Supplemental Indenture dated as of July 29, 1996 and the
Fourth Supplemental Indenture dated as of the date hereof
(the "Fourth Supplemental Indenture"), and as further
amended, supplemented or otherwise modified from time to
time, the "Indenture"), between the Funding Corporation
and Chase Manhattan Bank and Trust Company, National
Association, as trustee (the "Trustee");
WHEREAS, pursuant to the Original Indenture,
the Funding Corporation issued $232,750,000 of its 6.69%
Series A Senior Secured Notes Due 2000 (the "Series A
Securities"), $133,000,000 of its 7.37% Series B Senior
Secured Bonds Due 2005 (the "Series B Securities") and
$109,250,000 of its 7.84% Series C Senior Secured Bonds
Due 2010 (the "Series C Securities" and, collectively
with the Series A Securities and the Series B Securities,
the "Original Securities");
WHEREAS, the Funding Corporation used the
proceeds of the Original Securities to make three
separate loans to (i) SSPB, SSPG and Fish Lake (the
"Original Salton Sea Guarantors"), (ii) VPC and CEOC (the
"Original Partnership Guarantors") and (iii) the Royalty
Guarantor, each pursuant to a separate credit agreement
(each a "Credit Agreement") entered into between the
Funding Corporation and each of the Original Salton Sea
Guarantors, the Original Partnership Guarantors and the
Royalty Guarantor;
WHEREAS, in connection with the issuance of the
Original Securities, the Funding Corporation, the
Original Salton Sea Guarantors, the Original Partnership
Guarantors, the Royalty Guarantor, the Collateral Agent
and the Depositary Agent entered into the Deposit and
Disbursement Agreement dated as of July 21, 1995 (the
"Original Depositary Agreement") in order to appoint the
Depositary Agent as depositary agent to hold and
administer monies deposited into various funds
established pursuant to the Original Depositary Agreement
and funded with, among other things, the proceeds of the
Original Securities, proceeds of drawings under the
Working Capital Facility, casualty insurance,
condemnation and title insurance proceeds, and revenues,
equity cash flows and royalties received by the
Guarantors;
WHEREAS, pursuant to the Second Supplemental
Indenture, the Funding Corporation issued $70,000,000 of
its 7.02% Series D Senior Secured Notes Due 2000 (the
"Series D Securities") and $65,000,000 of its 8.30%
Series E Senior Secured Bonds Due 2011 (the "Series E
Securities" and, together with the Series D Securities,
the "Second Offering Securities");
WHEREAS, the Funding Corporation used the
proceeds of the Second Offering Securities to make a loan
to (i) the Original Partnership Guarantors and (ii) BN
Geothermal, San Felipe, Conejo, Niguel, Vulcan, Del
Ranch, Elmore and Leathers (Leathers, collectively with
BN Geothermal, San Felipe, Conejo, Niguel, Vulcan, Del
Ranch and Elmore, the "Additional Partnership
Guarantors") pursuant to the Partnership Credit
Agreement;
WHEREAS, in connection with the issuance of the
Second Offering Securities, the Original Salton Sea
Guarantors, the Original Partnership Guarantors, the
Additional Partnership Guarantors and the Royalty
Guarantor entered into Amendment No. 1 to Deposit and
Disbursement Agreement dated as of June 20, 1996
("Amendment No. 1") in order to, among other things, add
the Additional Partnership Guarantors as parties to the
Depositary Agreement and establish the Capital
Expenditure Fund and set forth the mechanics for making
withdrawals therefrom;
WHEREAS, the Funding Corporation has determined
to issue $285,000,000 of its 7.475% Senior Secured Series
F Bonds Due 2018 (the "Series F Securities") pursuant to
the Fourth Supplemental Indenture;
WHEREAS, the Funding Corporation will use the
proceeds of the Series F Securities to (i) make a loan to
the Original Salton Sea Guarantors and Power LLC pursuant
to the Salton Sea Credit Agreement and (ii) make a loan
to the Original Partnership Guarantors, the Additional
Partnership Guarantors, Minerals LLC and Turbo LLC
pursuant to the Partnership Credit Agreement; and
WHEREAS, in connection with issuance of the
Series F Securities, the Funding Corporation, the
Guarantors, the Collateral Agent and the Depositary Agent
would like to amend and restate the Original Depositary
Agreement, as amended by Amendment No. 1, to, among other
things, add Power LLC, Minerals LLC and Turbo LLC as
parties to the Depositary Agreement and establish the
Construction Funds and set forth the mechanics for making
withdrawals therefrom.
NOW, THEREFORE, in consideration of the
premises and for other good and valuable consideration,
the receipt of which is hereby acknowledged, the Original
Depositary Agreement, as amended by Amendment No. 1, is
hereby amended and restated in its entirety as follows:
ARTICLE I
DEFINITIONS
SECTION I.1 Capitalized Terms. Capitalized
terms used and not otherwise defined herein shall have
the meanings assigned to them in the Indenture.
SECTION I.2 Definitions; Construction. For
all purposes of this Depositary Agreement, except as
otherwise expressly provided or unless the context
otherwise requires:
(a) all terms defined in this Article have the
meanings assigned to them in this Article, and include
the plural as well as the singular;
(b) all references in this Depositary
Agreement to designated "Articles," "Sections,"
"Exhibits" and other subdivisions are to the designated
Articles, Sections, Exhibits and other subdivisions of
this Depositary Agreement;
(c) the words "herein," "hereof" and
"hereunder" and other words of similar import refer to
this Depositary Agreement as a whole and not to any
particular Article, Section, Exhibit or other
subdivision;
(d) unless otherwise expressly specified, any
agreement, contract or document defined or referred to
herein shall mean such agreement, contract or document as
in effect as of the date hereof, as the same may
thereafter be amended, restated, supplemented or
otherwise modified from time to time in accordance with
the terms thereof and of the Indenture and the other
Financing Documents and including any agreement, contract
or document in substitution or replacement of any of the
foregoing;
(e) unless the context clearly intends to the
contrary, pronouns having a masculine or feminine gender
shall be deemed to include the other; and
(f) any reference to any Person shall include
its successors and assigns.
"Additional Partnership Project Note" shall
mean the promissory note dated October 13, 1998 in the
amount of $201,728,000 executed by the Partnership
Guarantors in favor of the Funding Corporation pursuant
to the Partnership Credit Agreement.
"Additional Salton Sea Project Note" shall mean
the promissory note dated October 13, 1998 in the amount
of $83,272,000 executed by the Salton Sea Guarantors in
favor of the Funding Corporation pursuant to the Salton
Sea Credit Agreement.
"Administrative Costs" means all obligations of
the Funding Corporation and the Guarantors, now or
hereafter existing, to pay administrative fees, costs and
expenses to any trustee or agent of any Secured Party,
including the Collateral Agent, the Depositary Agent, any
party that becomes the agent for the Working Capital
Facility Provider, the Debt Service Reserve LOC Provider
and the Trustee.
"Allocation Certificate" means each certificate
provided by the Funding Corporation, one of the
Guarantors, or, pursuant to Section 6(d) of the
Intercreditor Agreement, the Required Secured Parties (as
defined in the Intercreditor Agreement), as applicable,
setting forth the allocation of Loss Proceeds, Eminent
Domain Proceeds, Title Event Proceeds or cash proceeds
resulting from liquidation of the Collateral and Funding
Corporation Collateral, as the case may be, among the
Secured Parties (to the extent the Secured Obligations of
such Secured Parties may be redeemed or prepaid under the
applicable Financing Documents).
"Capital Expenditure Fund" means the Fund of
such name established pursuant to Section 2.2 and having
the following account number at the Depositary Agent:
C28187F.
"Capital Expenditure Requisition" has the
meaning specified in Section 3.14(c).
"Cash Fund" means the Fund of such name
established pursuant to Section 2.2 and having the
following account number at Bank of America: Account No.
2335309075.
"Combined Exposure" means, as of any date of
calculation, the sum (calculated without duplication) of
the following, to the extent the same is held by or
represented by a Creditor: (i) the aggregate principal
amount of all Outstanding Securities, (ii) the aggregate
principal amount of all Permitted Debt outstanding (other
than the Securities and Subordinated Debt), (iii) the
aggregate amount of all available undrawn financing
commitments under the documents governing the Permitted
Debt (other than the Securities and Subordinated Debt)
which the creditors party to such documents have no right
to terminate, (iv) the maximum amount available to be
drawn under the Debt Service Reserve Letter of Credit
issued pursuant to the Debt Service Reserve LOC
Reimbursement Agreement (if any) and (v) the termination
payment due and owing as of such calculation date or
which the Permitted Counterparty thereunder has a right
to cause to be due and owing as of such calculation date
under any Interest Rate Protection Agreements.
"Construction Debt Service" shall mean any
payments, due prior to Final Completion of the New
Projects and final completion of the Permitted Capital
Expenditures in accordance with the plans and
specifications therefor, of interest on, or other amounts
due in respect of (if any), the principal amount of
Series F Securities and (without duplication) interest
on, or other amounts due in respect of (if any), the
Additional Partnership Project Note and the Additional
Salton Sea Project Note.
"Construction Funds" means, collectively, the
Zinc Construction Fund, the Salton Sea Unit V
Construction Fund, the Region 2/Turbo Construction Fund
and the Construction Period Debt Service Fund.
"Construction Period Debt Service Fund" means
the Fund of such name established pursuant to Section 2.2
and having the following account number at the Depositary
Agent: C28186G.
"Construction Requisition" has the meaning
specified in Section 3.1.1(c).
"Creditors" means the Funding Corporation, the
Trustee, the Collateral Agent, the Depositary Agent, the
Debt Service Reserve LOC Provider (and the "Agent" and
"Banks" as each such term is defined in the Debt Service
Reserve LOC Reimbursement Agreement), any party that
becomes the agent for the Working Capital Facility
Provider, any Permitted Counterparty under any Interest
Rate Protection Agreement and any party that becomes a
Secured Party under the Intercreditor Agreement.
"Debt Service Reserve Bond" means each bond
issued by the Funding Corporation in exchange for a Debt
Service Reserve LOC Loan in accordance with, and pursuant
to the terms and provisions of, the Debt Service Reserve
LOC Reimbursement Agreement.
"Debt Service Reserve Fund" means the Fund of
such name established pursuant to Section 2.2 and having
the following account number at the Depositary Agent:
C28187A.
"Debt Service Reserve Bond Sub-Fund" means the
sub-fund of such name established pursuant to Section
2.2.
"Debt Service Reserve LOC Loan" means each loan
made to the Funding Corporation pursuant to the Debt
Service Reserve LOC Reimbursement Agreement.
"Debt Service Reserve LOC Loan Interest Sub-
Fund" means the sub-fund of such name established
pursuant to Section 2.2.
"Debt Service Reserve LOC Loan Principal Sub-
Fund" means the sub-fund of such name established
pursuant to Section 2.2.
"Debt Service Reserve LOC Credit Amount" has
the meaning specified in Section 3.2.
"Debt Service Reserve Required Balance" means
the amount set forth on Schedule I hereto, as such amount
may be adjusted from time to time in accordance with the
provisions set forth on such Schedule.
"Disbursement Date" means the date specified in
a Requisition as the date on which monies are requested
by a Guarantor to be withdrawn and transferred from the
Fund to which such Requisition relates for the purpose
set forth in such Requisition.
"Distribution Fund" means the Fund of such name
established pursuant to Section 2.2 and having the
following account number at the Depositary Agent:
C28187B.
"Distribution Suspense Fund" means the Fund of
such name established pursuant to Section 2.2 and having
the following account number at the Depositary Agent:
C28187C.
"Equity Contributions" has the meaning
specified in Section 1 of the Equity Commitment
Agreement.
"Fund Collateral" has the meaning specified in
Section 2.3.
"Funding Date" means any day from the 10th
through the 15th day of each month, as determined by the
Funding Corporation or any Guarantor in an officer's
certificate received by the Depositary Agent at least
three (3) Business Days prior to such Funding Date,
provided that there shall only be a single Funding Date
for any month (except in the case of an emergency
referred to below), or if no earlier date is so
determined, then the 15th day of each month, or in each
case if such day is not a Business Day the next
succeeding Business Day, or in the case of an emergency
related to funding Operating and Maintenance Costs, any
Business Day of the month.
"Funds" has the meaning specified in Section
2.2.
"Indemnified Depositary Agent Party" has the
meaning specified in Section 5.2.
"Independent Engineer Construction Certificate"
has the meaning specified in Section 3.1.1(c).
"Interest Fund" means the Fund of such name
established pursuant to Section 2.2 and having the
following account number at the Depositary Agent:
C28186C.
"Interest Payment Date" means with respect to
any (i) Security, each May 30th and November 30th,
commencing November 30, 1995 and concluding on the Final
Maturity Date, (ii) Debt Service Reserve LOC Loan, each
May 30th and November 30th, or any other date as may be
agreed from time to time by the Funding Corporation and
the agent under the Debt Service Reserve LOC
Reimbursement Agreement, commencing on the first such
date after the applicable drawing, and any date on which
interest on such Debt Service Reserve LOC Loan becomes
due and payable at redemption, the final maturity date or
declaration of acceleration, or otherwise, and (iii) Debt
Service Reserve Bond, each May 30th and November 30th,
commencing on the first such date after the applicable
conversion date, and any date on which interest on such
Debt Service Reserve Bond becomes due and payable at
redemption, the final maturity date or declaration of
acceleration, or otherwise.
"Liquidated Damages Sub-Funds" means,
collectively, the Zinc LD Sub-Fund, the Salton Sea Unit V
LD Sub-Fund, the Region 2/Turbo LD Sub-Fund and the LD
Holding Sub-Fund.
"Loss Proceeds Fund" means the Fund of such
name established pursuant to Section 2.2 and having the
following account number at the Depositary Agent:
C28187D.
"Non-Budgeted Operating and Maintenance Costs
Certificate" has the meaning specified in Section
3.2(c)(i)(A).
"Permitted Capital Expenditures" has the
meaning specified in Section 3.14(b).
"Permitted Investments" means investments in
securities that are: (i) direct obligations of the
United States or any agency thereof; (ii) obligations
fully guaranteed by the United States or any agency
thereof; (iii) certificates of deposit or bankers
acceptances issued by commercial banks (including the
Trustee or any of its Affiliates) organized under the
laws of the United States or of any political subdivision
thereof or under the laws of Canada, Japan, Switzerland
or any country that is a member of the European Economic
Community having a combined capital and surplus of at
least $250,000,000 and having long-term unsecured debt
securities then rated "A" or better by S&P or "A-2" or
better by Moody's (but at the time of investment not more
than $25,000,000 may be invested in such certificates of
deposit from any one bank); (iv) repurchase obligations
with a term of not more than seven days for underlying
securities of the types described in clauses (i) and (ii)
above, entered into with any financial institution
meeting the qualifications specified in clause (iii)
above; (v) open market commercial paper of any
corporation incorporated or doing business under the laws
of the United States or of any political subdivision
thereof having a rating of at least "A-1" from S&P and "P-
1" from Moody's (but at the time of investment not more
than $25,000,000 may be invested in such commercial paper
from any one company); (vi) auction rate securities or
money market preferred stock having one of the two
highest ratings obtainable from either S&P or Moody's
(or, if at any time neither S&P nor Moody's may be rating
such obligations, then from another nationally recognized
rating service acceptable to the Trustee); or (vii)
investments in money market funds or money market mutual
funds sponsored by any securities broker dealer of
recognized national standing (or an Affiliate thereof),
having an investment policy that requires substantially
all the invested assets of such fund to be invested in
investments described in any one or more of the foregoing
clauses having a rating of "A" or better by S&P or "A-2"
or better by Moody's (including money market funds for
which the Depositary Agent in its individual capacity,
its parent or any of its affiliates is investment manager
or adviser).
"Principal Fund" means the Fund of such name
established pursuant to Section 2.2 and having the
following account number at the Depositary Agent:
C28186B.
"Principal Payment Date" means with respect to
(i) any Security, the date on which all or a portion of
the principal of such Security becomes due and payable as
provided therein or in the Indenture, whether on a
scheduled date for payment of principal at a Redemption
Date, the Final Maturity Date, a date of declaration of
acceleration or otherwise, (ii) any Debt Service Reserve
LOC Loan, each May 30th and November 30th, or any other
date as may be agreed from time to time by the Funding
Corporation and the agent under the Debt Service Reserve
LOC Reimbursement Agreement, commencing on the first such
date after the applicable drawing, and the date on which
all or a portion of the principal of such Debt Service
Reserve LOC Loan becomes due and payable at redemption,
the final maturity date or declaration of acceleration,
or otherwise, and (iii) any Debt Service Reserve Bond,
each May 30th and November 30th, commencing on the first
such date after the applicable conversion date, and any
date on which principal of such Debt Service Reserve Bond
becomes due and payable at redemption, the final maturity
date or declaration of acceleration, or otherwise.
"Redemption Fund" means the Fund of such name
established pursuant to Section 2.2 and having the
following account number at the Depositary Agent:
C28187E.
"Region 2/Turbo Construction Costs" has the
meaning specified in Section 3.1.3(b).
"Region 2/Turbo Construction Fund" means the
Fund of such name established pursuant to Section 2.2 and
having the following account number at the Depositary
Agent: C28186F.
"Required Secured Parties" means, at any time,
Persons that at such time hold at least 33-1/3% of the
Combined Exposure, provided that for purposes of
directing actions of the Collateral Agent, (i) the
Funding Corporation shall convey, transfer and assign its
right to vote on all matters under the Intercreditor
Agreement to the Trustee and (ii) the Trustee shall be
entitled to vote on all matters under the Intercreditor
Agreement according to the aggregate principal amount of
the Outstanding Securities, subject, however, in all
events, to the terms and provisions of the Indenture.
"Requisition" means a Construction Requisition,
a Capital Expenditure Requisition, a Non-Budgeted
Operating and Maintenance Costs Certificate, a
Restoration Requisition or a Title Event Requisition.
"Responsible Officer" means the president or
any vice president, assistant vice president or the trust
officer of the Trustee to whom any matter has been
referred because of such officer's knowledge and
familiarity with the particular subject.
"Restoration Budget" has the meaning specified
in Section 3.8.
"Restoration Progress Payment Schedule" has the
meaning specified in Section 3.8.
"Restoration Requisition" has the meaning
specified in Section 3.8.
"Restoration Sub-Fund" means the sub-fund of
such name established pursuant to Section 2.2.
"Revenue Fund" means the Fund of such name
established pursuant to Section 2.2 and having the
following account number at the Depositary Agent:
C28186A.
"Salton Sea Unit V Construction Costs" has the
meaning specified in Section 3.1.2(b).
"Salton Sea Unit V Construction Fund" means the
Fund of such name established pursuant to Section 2.2 and
having the following account number at the Depositary
Agent: C28186E.
"Senior Debt" means all of the Permitted Debt
of the Funding Corporation other than Subordinated Debt.
"Series F Closing Date" means the date of
issuance and delivery of the Series F Securities.
"Title Event Requisition" has the meaning
specified in Section 3.8.
"Title Event Sub-Fund" means the sub-fund of
such name established pursuant to Section 2.2.
"Trigger Event" means (a)(i) an "Event of
Default" under the Indenture and an acceleration of all
or a portion of the indebtedness issued thereunder, (ii)
an "Event of Default" under the Debt Service Reserve LOC
Reimbursement Agreement and an acceleration of all or a
portion of the indebtedness incurred thereunder, (iii) an
"Event of Default" under a Senior Debt instrument and an
acceleration of all or a portion of the Debt issued
thereunder in an aggregate principal amount in excess of
$10,000,000 or (iv) there shall have occurred and be
continuing any Guarantee Event of Default under (x) the
Partnership Guarantee at a time when the Partnership
Project Note shall have been paid in full or (y) the
Royalty Guarantee at a time when the Royalty Project Note
shall have been paid in full, and such Guarantee Event of
Default, if it had been a Credit Agreement Event of
Default at a time prior to the payment in full of any
such Project Note, would have resulted in the
acceleration of such Project Note (assuming the exercise
by the Funding Corporation of its rights of acceleration
in respect of such Project Note pursuant to the terms of
the relevant Credit Agreement and the giving of any
applicable notices and passage of any applicable time
requirements thereunder); and in each case, the
Collateral Agent shall have, upon direction from the
Required Secured Parties (as defined in the Intercreditor
Agreement), declared such event to be a Trigger Event.
"Trigger Event Date" has the meaning specified
in Section 3.13.
"Zinc Construction Costs" has the meaning
specified in Section 3.1.1(b).
"Zinc Construction Fund" means the Fund of such
name established pursuant to Section 2.2 and having the
following account number at the Depositary Agent:
C28186D.
ARTICLE II
APPOINTMENT OF DEPOSITARY AGENT;
ESTABLISHMENT OF FUNDS
SECTION II.1 Acceptance of Appointment of
Depositary Agent. (a) The Depositary Agent hereby
agrees to act as such and to accept all cash, payments,
other amounts and Permitted Investments to be delivered
to or held by the Depositary Agent pursuant to the terms
of this Depositary Agreement and the Indenture. The
Depositary Agent shall hold and safeguard the Funds
during the term of this Depositary Agreement and shall
treat the cash, instruments and securities in the Funds
as monies, instruments and securities pledged by the
Guarantors to the Collateral Agent for the benefit of the
Secured Parties and the Funding Corporation to be held in
the custody of the Depositary Agent, as agent solely for
the Collateral Agent, in accordance with the provisions
of this Depositary Agreement. In performing its
functions and duties under this Depositary Agreement, the
Depositary Agent shall act solely as agent for the
Collateral Agent and, except in such capacity, does not
assume and shall not be deemed to have assumed any
obligation toward or relationship of agency or trust with
or for the Funding Corporation or any of the Guarantors.
(b) Neither the Funding Corporation nor any of
the Guarantors shall have any rights against or to monies
held in the Funds, as third party beneficiary or
otherwise, except the right to receive or make
requisitions of monies held in the Funds, as permitted by
this Depositary Agreement and the Indenture, and to
direct the investment of monies held in the Funds as
permitted by Section 3.10.
SECTION II.2 Establishment of Funds and Sub-
Funds. The Depositary Agent hereby establishes the
following funds (the "Funds") in the form of interest
bearing accounts and sub-accounts thereof, which shall be
maintained at all times until the termination of this
Depositary Agreement (provided that the Construction
Period Debt Service Fund shall terminate after all
required deposits into and withdrawals from such Fund
shall have been made in accordance with Section 3.1.4 and
each of the other Construction Funds shall terminate upon
Final Completion of the relevant New Project):
(a) Zinc Construction Fund;
(b) Salton Sea Unit V Construction Fund;
(c) Region 2/Turbo Construction Fund;
(d) Construction Period Debt Service Fund;
(e) Revenue Fund;
(f) Principal Fund;
(g) Interest Fund;
(h) Debt Service Reserve Fund;
(i) Distribution Fund;
(j) Distribution Suspense Fund;
(k) Loss Proceeds Fund;
(l) Redemption Fund;
(m) Capital Expenditure Fund; and
(n) Cash Fund.
The Funds referred to in clauses (f), (g), (i)
and (j) are not required to be separate accounts but may
be maintained as subaccounts of the Revenue Fund. To the
extent the Debt Service Reserve Fund is fully funded or
the amounts in such Fund, together with the Debt Service
Reserve Letter of Credit, equal the Debt Service Reserve
Required Balance, interest on the amounts in such Funds
shall be transferred to the Revenue Fund.
The following six sub-funds are hereby
established and created within the Loss Proceeds Fund:
(i) Restoration Sub-Fund;
(ii) Title Event Sub-Fund;
(iii) Zinc LD Sub-Fund;
(iv) Salton Sea Unit V LD Sub-Fund;
(v) Region 2/Turbo LD Sub-Fund; and
(vi) LD Holding Sub-Fund.
The following three sub-funds are hereby
established and created within the Debt Service Reserve
Fund:
(i) Debt Service Reserve Bond Sub-Fund;
(ii) Debt Service Reserve LOC Loan
Interest Sub-Fund; and
(iii) Debt Service Reserve LOC Loan
Principal Sub-Fund.
Certain additional sub-funds within certain of
the Funds may be established and created from time to
time in accordance with this Depositary Agreement.
All amounts from time to time held in each Fund
(other than amounts in the Debt Service Reserve Fund and
the Liquidated Damages Sub-Funds) shall be held (a) in
the name of the Depositary Agent, as agent for the
Collateral Agent for the benefit of the Secured Parties
and the Funding Corporation and (b) in the custody of the
Depositary Agent for the purposes and on the terms set
forth in this Depositary Agreement, the Indenture and the
Intercreditor Agreement and all such amounts shall
constitute a part of the Collateral and shall not
constitute payment of any Debt or any other obligation of
the Funding Corporation or any Guarantor until applied as
hereinafter provided. All amounts held from time to time
in the Debt Service Reserve Fund shall be held in the
name of the Depositary Agent, as agent for the Collateral
Agent, for the sole benefit of the Trustee, except for
those amounts (up to a maximum aggregate of $5,000,000
per fiscal year) available to be drawn in favor of the
Debt Service Reserve LOC Provider in respect of interest
due and payable, but unpaid, on outstanding Debt Service
Reserve LOC Loans, as set forth in Section 3.5(g). All
amounts held from time to time in the Liquidated Damages
Sub-Funds shall be held in the name of the Depositary
Agent, as agent for the Collateral Agent, for the sole
benefit of the Trustee.
SECTION II.3 Security Interest. (a) As
collateral security for the prompt and complete payment
and performance when due of all its obligations, each
Guarantor has pledged, assigned, hypothecated and
transferred to the Collateral Agent for the benefit of
the Secured Parties and the Funding Corporation, and has
granted to the Collateral Agent a Lien on and security
interest in and to, and in furtherance thereof hereby
pledges, assigns, hypothecates and transfers to the
Depositary Agent for the benefit of the Secured Parties
and the Funding Corporation, and hereby grants to the
Collateral Agent for the benefit of the Secured Parties
and the Funding Corporation a Lien on and security
interest in and to, (i) each Fund and (ii) all cash,
investments and securities at any time on deposit in any
Fund, including all income or gain earned thereon and any
proceeds thereof (collectively, the "Fund Collateral").
The Depositary Agent is the agent of the Collateral Agent
for the purpose of receiving payments contemplated
hereunder and for the purpose of perfecting the Lien of
the Collateral Agent for the benefit of the Secured
Parties and the Funding Corporation in and to the Funds
and all cash, investments and securities and any proceeds
thereof at any time on deposit in the Funds; provided
that the Depositary Agent shall not be responsible to
take any action to perfect such Lien except through the
performance of its express obligations hereunder or upon
the written direction of the Collateral Agent complying
with this Depositary Agreement and the Intercreditor
Agreement. Each of the Funds shall at all times be in
the exclusive possession of, and under the exclusive
domain and control of, the Depositary Agent, as agent for
the Collateral Agent.
SECTION II.4 Termination. This Depositary
Agreement shall remain in full force and effect until the
termination of the Intercreditor Agreement pursuant to
Section 27 thereof.
ARTICLE III
THE FUNDS
SECTION III.1 Construction Funds.
3.1.1 Zinc Construction Fund. (a) On the
Series F Closing Date, $126,317,000 shall be delivered to
the Depositary Agent and deposited in the Zinc
Construction Fund from the net proceeds of the sale of
the Series F Securities. The following amounts shall
(subject to Section 3.8) be delivered to the Depositary
Agent directly for deposit into the Zinc Construction
Fund, or if received by Minerals LLC, as soon as
practicable upon receipt:
(i) all Equity Contributions made by CalEnergy
pursuant to Sections 2(a) of the Equity
Commitment Agreement;
(ii) all revenues actually received by Minerals
LLC from the Zinc Project prior to
Substantial Completion of the Zinc
Project;
(iii) all income from the investment of
monies in the Zinc Construction Fund
pursuant to Section 3.10;
(iv) all amounts required to be transferred to
the Zinc Construction Fund pursuant to
Section 3.8(iii); and
(v) all other amounts required to be
transferred to the Zinc Construction Fund
from any other Funds pursuant to this
Depositary Agreement.
(b) Until Final Completion of the Zinc
Project, amounts on deposit in the Zinc Construction Fund
shall be applied solely for the payment of (i) costs (or
reimbursement to the extent the same have been previously
paid or satisfied by or on behalf of Minerals LLC)
incurred in connection with the engineering, development,
construction and start-up of the Zinc Project and (ii)
any Operating and Maintenance Costs for the Zinc Project
prior to Final Completion thereof (collectively, "Zinc
Construction Costs") and for the payment of Zinc
Construction Costs reasonably expected to be incurred
during the 30-day period following the relevant Disburse
ment Date. All amounts withdrawn from the Zinc
Construction Fund shall be withdrawn in accordance with
the disbursement procedure hereinafter described in this
Section 3.1.1.
(c) As a condition precedent to any
withdrawal and transfer from the Zinc Construction Fund
there shall be filed with the Depositary Agent, with
respect to each Disbursement Date on which any such
withdrawal and transfer is requested to be made, (i) an
appropriately completed requisition in the form attached
hereto as Exhibit A-1 (a "Construction Requisition")
signed by an Authorized Representative of Minerals LLC
and (ii) an appropriately completed certificate of the
Independent Engineer in the form attached hereto as
Exhibit A-2 (an "Independent Engineer's Construction
Certificate") signed by an authorized representative of
the Independent Engineer, in each case dated not more
than five (5) days prior to, and received by the
Depositary Agent not less than three (3) Business Days
prior to, such Disbursement Date (as such date is set
forth in such Construction Requisition).
(d) On the Disbursement Date referred to in
clause (c) of this Section 3.1.1, or as soon thereafter
as possible following receipt of the Construction Requisi
tion referred to in such clause, the Depositary Agent
shall make payments in accordance with such Construction
Requisition. The Depositary Agent may conclusively rely
on any Construction Requisition in making any
disbursements under this clause (d).
(e) Upon Final Completion of the Zinc Project,
as evidenced by an Officer's Certificate delivered to the
Depositary Agent, amounts remaining in the Zinc
Construction Fund, if any, shall be transferred to the
Revenue Fund, the Salton Sea Unit V Construction Fund or
the Region 2/Turbo Construction Fund, as directed in such
Officer's Certificate.
3.1.2 Salton Sea Unit V Construction Fund.
(a) On the Series F Closing Date, $74,854,000 shall be
delivered to the Depositary Agent and deposited in the
Salton Sea Unit V Construction Fund from the net proceeds
of the sale of the Series F Securities. The following
amounts shall (subject to Section 3.8) be delivered to
the Depositary Agent directly for deposit into the Salton
Sea Unit V Construction Fund, or if received by Power
LLC, as soon as practicable upon receipt:
(ii) all Equity Contributions made by CalEnergy
pursuant to Section 2(b) of the Equity
Commitment Agreement;
(iii) all revenues actually received by
Power LLC from Salton Sea Unit V prior to
Substantial Completion of Salton Sea Unit
V;
(iv) all income from the investment of monies
in the Salton Sea Unit V Construction Fund
pursuant to Section 3.10;
(v) all amounts required to be transferred to
the Salton Sea Unit V Construction Fund
pursuant to Section 3.8(iii); and
(vi) all other amounts required to be
transferred to the Salton Sea Unit V
Construction Fund from any other Funds
pursuant to this Depositary Agreement.
(b) Until Final Completion of Salton Sea Unit
V, amounts on deposit in the Salton Sea Unit V
Construction Fund shall be applied solely for the payment
of (i) costs (or reimbursement to the extent the same
have been previously paid or satisfied by or on behalf of
Power LLC) incurred in connection with the engineering,
development, construction, start-up and operation of
Salton Sea Unit V and (ii) any Operating and Maintenance
Costs for Salton Sea Unit V prior to Final Completion
thereof (collectively, "Salton Sea Unit V Construction
Costs") and for the payment of Salton Sea Unit V
Construction Costs reasonably expected to be incurred
during the 30-day period following the relevant
Disbursement Date. All amounts withdrawn from the Salton
Sea Unit V Construction Fund shall be withdrawn in
accordance with the disbursement procedure hereinafter
described in this Section 3.1.2.
(c) As a condition precedent to any
withdrawal and transfer from the Salton Sea Unit V
Construction Fund there shall be filed with the
Depositary Agent, with respect to each Disbursement Date
on which any such withdrawal and transfer is requested to
be made, (i) an appropriately completed Construction
Requisition signed by an Authorized Representative of
Power LLC and (ii) an appropriately completed Independent
Engineer's Construction Certificate signed by an
authorized representative of the Independent Engineer, in
each case dated not more than five (5) days prior to, and
received by the Depositary Agent not less than three (3)
Business Days prior to, such Disbursement Date (as such
date is set forth in such Construction Requisition).
(d) On the Disbursement Date referred to in
clause (c) of this Section 3.1.2, or as soon thereafter
as possible following receipt of the Construction Requisi
tion referred to in such clause, the Depositary Agent
shall make payments in accordance with such Construction
Requisition. The Depositary Agent may conclusively rely
on any Construction Requisition in making any
disbursements under this clause (d).
(e) Upon Final Completion of Salton Sea Unit
V, as evidenced by an Officer's Certificate delivered to
the Depositary Agent, amounts remaining in the Salton Sea
Unit V Construction Fund, if any, shall be transferred to
the Revenue Fund, the Zinc Construction Fund or the
Region 2/Turbo Construction Fund, as directed in such
Officer's Certificate.
3.1.3 Region 2/Turbo Construction Fund. (a)
On the Series F Closing Date, $40,076,000 shall be
delivered to the Depositary Agent and deposited in the
Region 2/Turbo Construction Fund from the net proceeds of
the sale of the Series F Securities. The following
amounts shall (subject to Section 3.8) be delivered to
the Depositary Agent directly for deposit into the Region
2/Turbo Construction Fund, or if received by Turbo LLC,
Vulcan or Del Ranch, as soon as practicable upon receipt:
(ii) all Equity Contributions made by CalEnergy
pursuant to Section 2(c) of the Equity
Commitment Agreement;
(iii) all revenues actually received by
Turbo LLC from the Region 2/Turbo Project
prior to Substantial Completion of the
Region 2/Turbo Project;
(iv) all income from the investment of monies
in the Region 2/Turbo Construction Fund
pursuant to Section 3.10;
(v) all amounts required to be transferred to
the Region 2/Turbo Construction Fund
pursuant to Section 3.8(iii); and
(vi) all other amounts required to be
transferred to the Region 2/Turbo
Construction Fund from any other Funds
pursuant to this Depositary Agreement.
(b) Until Final Completion of the Region
2/Turbo Project, amounts on deposit in the Region 2/Turbo
Construction Fund shall be applied solely for the payment
of (i) costs (or reimbursement to the extent the same
have been previously paid or satisfied by or on behalf of
Turbo LLC, Vulcan or Del Ranch) incurred in connection
with the engineering, development, construction, start-up
and operation of the Region 2/Turbo Project and (ii) any
Operating and Maintenance Costs for the Region 2/Turbo
Project prior to Final Completion thereof (collectively,
"Region 2/Turbo Construction Costs") and for the payment
of Region 2/Turbo Construction Costs reasonably expected
to be incurred during the 30-day period following the
relevant Disbursement Date. All amounts withdrawn from
the Region 2/Turbo Construction Fund shall be withdrawn
in accordance with the disbursement procedure hereinafter
described in this Section 3.1.3.
(c) As a condition precedent to any
withdrawal and transfer from the Region 2/Turbo
Construction Fund there shall be filed with the
Depositary Agent, with respect to each Disbursement Date
on which any such withdrawal and transfer is requested to
be made, an appropriately completed Construction
Requisition signed by an Authorized Representative of
Turbo LLC, Vulcan or Del Ranch and dated not more than
five (5) days prior to, and received by the Depositary
Agent not less than three (3) Business Days prior to,
such Disbursement Date (as such date is set forth in such
Construction Requisition).
(d) On the Disbursement Date referred to in
clause (c) of this Section 3.1.3, or as soon thereafter
as possible following receipt of the Construction Requisi
tion referred to in such clause, the Depositary Agent
shall make payments in accordance with such Construction
Requisition. The Depositary Agent may conclusively rely
on any Construction Requisition in making any
disbursements under this clause (d).
(e) Upon Final Completion of the Region
2/Turbo Project, as evidenced by an Officer's Certificate
delivered to the Depositary Agent, amounts remaining in
the Region 2/Turbo Construction Fund, if any, shall be
transferred to the Revenue Fund, the Zinc Construction
Fund or the Salton Sea Unit V Construction Fund, as
directed in such Officer's Certificate.
3.1.4 Construction Period Debt Service Fund.
(a) On the Series F Closing Date, $23,575,000 shall be
delivered to the Depositary Agent and deposited in the
Construction Period Debt Service Fund from the net
proceeds of the sale of the Series F Securities. All
amounts received by the Depositary Agent pursuant to
Section 2(e) of the Equity Commitment Agreement shall be
deposited into the Construction Period Debt Service Fund.
All income from the investment of monies in the
Construction Period Debt Service Fund pursuant to Section
3.10 shall be redeposited into the Construction Period
Debt Service Fund.
(b) Until Final Completion of the New Projects
and final completion of the Permitted Capital
Expenditures in accordance with the plans and
specifications therefor, amounts on deposit in the
Construction Period Debt Service Fund shall be applied
solely for the payment of interest on, and other amounts
due in respect of (if any), the principal amount of the
Securities, at times and in amounts equal to the amounts
due and payable for Construction Debt Service. On any
date on which any Construction Debt Service is due, as
set forth in an Officer's Certificate delivered to the
Depositary Agent three (3) Business Days prior to such
date, the Depositary Agent shall withdraw from the
Construction Period Debt Service Fund an amount of monies
(as certified in such Officer's Certificate) sufficient
to pay such interest or other amounts and remit such
monies to the Persons entitled thereto for the payment of
such interest or other amounts. Upon Final Completion of
each of the New Projects and final completion of the
Permitted Capital Expenditures in accordance with the
plans and specifications therefor, as evidenced by an
Officer's Certificate delivered to the Depositary Agent,
amounts remaining in the Construction Period Debt Service
Fund, if any, shall be transferred to the Revenue Fund.
SECTION III.2 Revenue Fund. (a) The following
amounts shall (subject to Section 3.8) be delivered to
the Depositary Agent directly for deposit into the
Revenue Fund, or if received by a Guarantor, as soon as
practicable upon receipt, in either case in accordance
with this Section 3.2(a):
(i) subject to Section 3.1, all revenues
actually received by the Salton Sea
Guarantors from the Salton Sea Projects
and all revenues actually received by the
Partnership Project Companies from the
Partnership Projects;
(ii) all Equity Cash Flows and Royalties
received by CEOC and VPC;
(iii) to the extent not included in clause
(ii), all Equity Cash Flows and Royalties
received by CEOC under the Magma Services
Agreement and by VPC in respect of the
Vulcan Project;
(iv) all Royalties received by the Royalty
Guarantor;
(v) all amounts from any Construction Fund, to
the extent that, following Final
Completion of the relevant New Project,
there are excess funds in such
Construction Fund and the Funding
Corporation has not elected to deposit
such excess funds into another
Construction Fund;
(vi) other than amounts required to be
deposited into a Construction Fund
pursuant to Section 3.10 and to the extent
the Debt Service Reserve Fund is fully
funded or the amounts in such Fund (not
including any funds held in the Debt
Service Reserve Bond Sub-Fund, the Debt
Service Reserve LOC Loan Interest Sub-Fund
or the Debt Service Reserve LOC Loan
Principal Sub-Fund), together with the
Debt Service Reserve Letter of Credit,
equals the Debt Service Reserve Required
Balance, any income from the investment of
the monies in any of the Funds pursuant to
Section 3.10; and
(vii) all amounts required to be
transferred to the Revenue Fund from any
other Funds as contemplated under this
Depositary Agreement or as provided in
Section 7 of the Intercreditor Agreement.
If any of the foregoing amounts required to be deposited
with the Depositary Agent in accordance with the terms of
this Depositary Agreement are received by any Guarantor
(or any Affiliate of such Guarantor), such Guarantor
shall (or shall cause any such Affiliate to) hold such
payments in trust for the Collateral Agent and shall
promptly remit such payments to the Depositary Agent for
deposit in the Revenue Fund, in the form received, with
any necessary endorsements.
(b) In the event the Depositary Agent receives
monies without adequate instruction with respect to the
proper Fund in which such monies are to be deposited, the
Depositary Agent shall deposit such moneys into the
Revenue Fund, segregate such monies from all other
amounts on deposit in the Revenue Fund and notify the
Guarantors of the receipt of such monies. Upon receipt
of written instructions from any Guarantor, the
Depositary Agent shall transfer such monies from the
Revenue Fund to the Fund specified by such instructions
(other than the Distribution Fund).
(c) The Funding Corporation and each Guarantor
hereby irrevocably authorizes the Depositary Agent to
make withdrawals and transfers of monies on each Funding
Date (via wire transfer or otherwise in the discretion of
the Depositary Agent) to the extent then available in the
Revenue Fund, upon the delivery of an officer's
certificate of such Guarantor or the Funding Corporation
(or any of their duly authorized agents for such
purposes) to the Depositary Agent three (3) Business Days
prior to such Funding Date setting forth the amounts to
be withdrawn from the Revenue Fund and the amounts to be
transferred pursuant to this clause (c) pursuant to the
terms of this Depositary Agreement in the following order
of priority:
(i) First: To pay when due the
amount of Operating and Maintenance Costs (including
principal, interest and commitment fees due and
payable with respect to Working Capital Debt and
Debt incurred in connection with Interest Rate
Protection Agreements) of any Guarantor or the
Funding Corporation or otherwise in respect of any
Project as set forth in the officer's certificate of
such Guarantor or the Funding Corporation (or any of
their duly authorized agents for such purposes) and
certified by such officer's certificate to be the
good faith estimate of the amounts payable for
Operating and Maintenance Costs, and stating that
the proviso immediately below does not apply to such
withdrawal; provided that if the cumulative
Operating and Maintenance Costs of such Guarantor in
any fiscal year, including the amounts set forth in
such officer's certificate, exceed the projected
Operating and Maintenance Costs in the applicable
annual operating budget of such Guarantor by more
than 25%, then no amounts may be withdrawn on behalf
of such Guarantor to pay non-budgeted operating
costs unless there shall be filed with the
Depositary Agent:
(A) an officer's certificate of such
Guarantor substantially in the form attached
hereto as Exhibit B (the "Non-Budgeted
Operating and Maintenance Costs Certificate"),
dated not more than three (3) Business Days
prior to such requested Disbursement Date; or
(B) if the relevant Guarantor does
not certify that (i) such additional non-
budgeted costs are reasonably designed to
permit such Guarantor to satisfy its
obligations in respect of its Project Note and
maximize its revenue and net income and (ii) it
is reasonable to expect that (A) a Debt Service
Coverage Ratio of at least 1.4 to 1 will be
maintained for the next 12-month period if such
period ends prior to 2000 or (B) a Debt Service
Coverage Ratio of at least 1.5 to 1 will be
maintained for the next 12-month period if such
period ends after January 1, 2000, an
Independent Engineer's Certificate, in substan
tially the form attached as Appendix I to
Exhibit B, dated not more than three (3)
Business Days prior to such requested
Disbursement Date;
(ii) Second: After making each
applicable withdrawal and transfer specified in
clause (i) above, withdraw and transfer from the
Revenue Fund on each Funding Date, to the Depositary
Agent, the Trustee, the agent under the Debt Service
Reserve LOC Reimbursement Agreement, the agent for
the Working Capital Facility Provider and the
Collateral Agent any amounts set forth in an
officer's certificate of the Funding Corporation or
any Guarantor then due and payable to each of the
Depositary Agent, the Trustee, the Collateral Agent,
the agent under the Debt Service Reserve LOC
Reimbursement Agreement or the agent for the Working
Capital Facility Provider as Administrative Costs;
provided, however, that if monies in the Revenue
Fund are insufficient on any date to make the
payments specified in this clause (ii), distribution
of monies shall be made ratably to the specified
recipients based on the respective amounts owed such
recipients;
(iii) Third: After making each
applicable withdrawal and transfer specified in
clauses (i) and (ii) above, transfer an amount set
forth in an officer's certificate of the Funding
Corporation or any Guarantor from the Revenue Fund
on each Funding Date (A) to the Interest Fund an
amount which, together with the amount then in such
Fund and the amount in the Construction Period Debt
Service Fund which is allocated to pay interest on
the next succeeding Interest Payment Date pursuant
to Section 3.1.4, equals all of the interest due or
becoming due on the Securities and (without
duplication) the Project Notes, on the next
succeeding Interest Payment Date, (B) to the
Principal Fund an amount which, together with the
amount then in such Fund, equals all of the
principal and premium (if any) due or becoming due
on the Securities and (without duplication) the
Project Notes, on the next succeeding Principal
Payment Date, (C) to the agent under the Debt
Service Reserve LOC Reimbursement Agreement an
amount which equals all of the commitment, letter of
credit and fronting fees becoming due and payable
under the Debt Service Reserve LOC Reimbursement
Agreement on the next succeeding payment date, (D)
to the Debt Service Reserve LOC Loan Interest Sub-
Fund an amount which, together with the amount then
in such Sub-Fund, equals all of the interest due or
becoming due on any Debt Service Reserve LOC Loans
on the next succeeding Interest Payment Date, and
(E) to the Debt Service Reserve Bond Sub-Fund an
amount which, together with the amount then in such
Sub-Fund, equals all of the principal, premium (if
any) and interest due or becoming due on all of the
Debt Service Reserve Bonds on the next succeeding
Scheduled Payment Date; provided, however, that if
monies in the Revenue Fund are insufficient on any
date to make the payments specified in this clause
(iii), distribution of monies shall be made ratably
to the specified recipients based on the respective
amounts owed such recipients;
(iv) Fourth: After making each
applicable withdrawal and transfer specified in
clauses (i), (ii) and (iii) above, withdraw from the
Revenue Fund on each Funding Date, as set forth in
an officer's certificate of the Funding Corporation
or any Guarantor, and transfer (A) to the Debt
Service Reserve LOC Loan Principal Sub-Fund an
amount which, together with the amount then in such
Sub-Fund, equals all of the principal outstanding on
any Debt Service Reserve LOC Loans on the next
succeeding Principal Payment Date, (B) to the agent
under the Debt Service Reserve LOC Reimbursement
Agreement (1) any direct loss (but excluding any
indirect, consequential or incidental loss or
damage), cost or out-of-pocket expense which the
Debt Service Reserve LOC Provider or such other
financial institution providing a Debt Service
Reserve LOC Loan incurs as a result of a prepayment
of any Debt Service Reserve LOC Loan bearing
interest at a London interbank offered rate on a
date which is not the last day of the applicable
interest period, to the extent that such loss, cost
or expense is required to be paid to the Debt
Service Reserve LOC Provider and such other
financial institutions under the agreement
evidencing such Debt Service Reserve LOC Loan, and
(2) any amounts certified by the Debt Service
Reserve LOC Provider or any financial institution
providing a Debt Service Reserve LOC Loan to be
required to compensate such lender for amounts due
under Sections 2.15, 2.16 and/or 2.17 of the Debt
Service Reserve LOC Reimbursement Agreement (as in
effect on the Closing Date, or any such
corresponding section of any similar agreement
refinancing or replacing such Debt Service Reserve
LOC Reimbursement Agreement) and (C) if no Debt
Service Reserve Letter of Credit is outstanding, to
the Debt Service Reserve Fund an amount as necessary
to fund the Debt Service Reserve Fund up to the Debt
Service Reserve Required Balance; provided, however,
that if monies in the Revenue Fund are insufficient
on any date to make the payments specified in this
clause (iv), distribution of monies shall be made
ratably to the specified recipients based on the
respective amounts owed such recipients;
(v) Fifth: After making each
applicable withdrawal and transfer specified in
clauses (i), (ii), (iii) and (iv) above, withdraw
from the Revenue Fund on each Funding Date, as set
forth in an officer's certificate of the Funding
Corporation or any Guarantor, any indemnification
expenses or other amounts heretofore not paid and
required to be paid to any of the Secured Parties,
to the extent then due and payable, including,
without limitation amounts due under Section 2.7(i)
of the Debt Service Reserve LOC Reimbursement
Agreement (as in effect on the Closing Date, or any
such corresponding section of any similar agreement
refinancing or replacing such Debt Service Reserve
LOC Reimbursement Agreement); provided, however,
that if monies in the Revenue Fund are insufficient
on any date to make the payments specified in this
clause (v), distribution of monies shall be made
ratably to the specified recipients based on the
respective amounts owed such recipients;
(vi) Sixth: After making each
applicable withdrawal and transfer specified in
clauses (i), (ii), (iii), (iv) and (v) above,
transfer from the Revenue Fund on each Funding Date
any remaining amounts, as set forth in an officer's
certificate of the Funding Corporation or any
Guarantor, for transfer to the Distribution Fund;
and
(vii) Seventh: After making each
applicable withdrawal and transfer specified in
clauses (i), (ii), (iii), (iv), (v) and (vi) above,
transfer from the Distribution Fund any amounts, as
set forth in an officer's certificate of the Funding
Corporation or any Guarantor, in the Distribution
Fund which cannot be distributed because of the
failure to satisfy certain conditions to
distributions as set forth in Section 3.6(b), to the
Distribution Suspense Fund.
In the event the Securities are accelerated and
no foreclosure occurs within 180 days thereafter, then
principal of the Debt Service Reserve LOC Loans shall be
paid equally and ratably in priority Third in lieu of
priority Fourth above until such time as such foreclosure
has occurred or such acceleration has been rescinded or
otherwise remedied.
Notwithstanding the foregoing provisions of
clause (iv) above, if the Debt Service Reserve Letter of
Credit has not been renewed or reinstated by a date 3.5
years prior to its stated expiration date, monies
withdrawn and transferred as specified in clause (iv)
above for application in priority Fourth shall, during
such 3.5 year period and until either (1) the Outstanding
Amount (as defined in the Debt Service Reserve LOC
Reimbursement Agreement) of the Debt Service Reserve
Letter of Credit is reduced to zero and no Debt Service
Reserve LOC Loans are outstanding or (2) a replacement
Debt Service Reserve Letter of Credit issued by a Debt
Service Reserve LOC Provider is provided to the
Depositary Agent and the commitments of the lenders
providing such original Debt Service Reserve Letter of
Credit which has not been renewed or reinstated are
terminated in accordance with Section 2.21 of the Debt
Service Reserve LOC Reimbursement Agreement (as in effect
on the Closing Date, or such corresponding section of any
similar agreement refinancing or replacing such Debt
Service Reserve LOC Reimbursement Agreement), be
distributed (after making any distribution in sub-clause
(B) of clause (iv) above) ratably as follows: (a) to the
Debt Service Reserve LOC Loan Principal Sub-Fund for
application against the principal of any Debt Service
Reserve LOC Loans due or becoming due on the next
succeeding Principal Payment Date; and (b) to the Debt
Service Reserve Fund until the amount deposited therein
equals the Debt Service Reserve Required Balance (such
amount deposited under this clause (b), the "Debt Service
Reserve LOC Credit Amount").
The Funding Corporation, the Guarantors, the
Collateral Agent and the Depositary Agent hereby
acknowledge that amounts paid by the Guarantors and
transferred to the Principal Fund and Interest Fund
pursuant to the terms hereof and applied by the
Depositary Agent for payment of principal and interest
owed from time to time on any series of Securities shall
reduce by the amount paid by each such Guarantor the
outstanding principal amount of the respective Project
Note of such Guarantor.
SECTION III.3 Principal Fund. (a) Monies
deposited in the Principal Fund on any Funding Date shall
be allocated ratably among sub-funds of the Principal
Fund established for each series of Securities and
(without duplication) each Project Note based on the
principal and premium, if any, due and payable on the
Securities and Project Notes at the next succeeding
Principal Payment Date falling on or within six months
following such Funding Date. Except as otherwise
provided in this Depositary Agreement, monies in such sub-
funds shall be used for the payment (without
duplication), when due and payable (whether at the
Principal Payment Date or otherwise), of principal and
premium, if any, with respect to the related series of
Securities.
(b) On any Funding Date that amounts for
the payment of principal of and premium, if any, on any
given series or any specific notes or bonds within a
particular series of Securities and (without duplication)
any Project Note are due and payable and have been
requisitioned in accordance with Section 3.2(c), the
Depositary Agent shall withdraw the monies on deposit in
the sub-fund of the Principal Fund allocated for such
series of Securities, and remit such monies to the
Persons entitled thereto for the payment of such
principal and premium, if any; provided, however, that
the Depositary Agent shall segregate such amounts from
any other amounts on deposit in the Principal Fund until
such time as payment is made to Persons entitled thereto.
(c) In the event that monies in the
Principal Fund exceed the amount of money required by
this Depositary Agreement to be deposited therein after
giving effect to the payment made on such Principal
Payment Date, the Depositary Agent shall transfer such
excess monies from the Principal Fund to the Revenue Fund
on such Principal Payment Date.
SECTION III.4 Interest Fund. (a) On any date
that amounts for the payment of interest on any given
series of Securities and (without duplication) any
Project Note (after giving effect to and without
duplication of interest to be paid pursuant to Section
3.1.4) are due and payable and have been requisitioned in
accordance with Section 3.2(c) (or if such day is not a
Business Day, then on the next succeeding Business Day),
the Depositary Agent shall withdraw the monies on deposit
in the sub-fund of the Interest Fund allocated for such
series of Securities, and remit such monies to the
Persons entitled thereto for the payment of such
interest, as requisitioned pursuant to Section 3.2(c);
provided, however, that the Depositary Agent shall
segregate such amounts from any other amounts on deposit
in the Interest Fund until such time as payment is made
to Persons entitled thereto.
(b) In the event that monies in the
Interest Fund exceed the amount of money required by this
Depositary Agreement to be deposited therein after giving
effect to the payment made on such Interest Payment Date,
the Depositary Agent shall transfer such excess monies
from the Interest Fund to the Revenue Fund on such
Interest Payment Date.
SECTION III.5 Debt Service Reserve Fund. (a)
On the Series F Closing Date the Funding Corporation and
the Guarantors will furnish to the Depositary Agent a
Debt Service Reserve Letter of Credit in an amount equal
to the Debt Service Reserve Required Balance from a
commercial bank or other financial institution whose long-
term unsecured debt obligations are rated at least "A" by
S&P and "A2" by Moody's, or otherwise make available to
the Depositary Agent for deposit in the Debt Service
Reserve Fund an amount equal to the Debt Service Reserve
Required Balance. Any Debt Service Reserve Letter of
Credit will be issued pursuant to the Debt Service
Reserve LOC Reimbursement Agreement. Notwithstanding
anything to the contrary set forth in this Depositary
Agreement, amounts in the Debt Service Reserve Bond Sub-
Fund, Debt Service Reserve LOC Loan Interest Sub-Fund and
Debt Service Reserve LOC Loan Principal Sub-Fund shall
not be included in determining the amount held in the
Debt Service Reserve Fund.
(b) On each date on which the Depositary
Agent is required to withdraw or transfer monies from the
Revenue Fund, the Principal Fund, the Interest Fund, the
Debt Service Reserve LOC Loan Interest Sub-Fund and the
Debt Service Reserve LOC Loan Principal Sub-Fund to meet
principal and interest payments on the Securities and
interest payments on the Debt Service Reserve LOC Loans,
the Depositary Agent shall first withdraw or transfer
(for and only for the above mentioned purposes and after
giving effect to the application of monies available in
any other Fund pursuant to this Agreement) monies then
held in such relevant Fund. To the extent that monies
then held in such relevant Funds are insufficient to fund
such withdrawal and transfer, as evidenced by the
officer's certificate in connection with such withdrawal
and transfer, one (1) Business Day prior to such date,
the Depositary Agent shall deliver to the Debt Service
Reserve LOC Provider on such date (i) a draft on the Debt
Service Reserve LOC Provider in an amount equal to the
lesser of (A) the Outstanding Amount (as defined in the
Debt Service Reserve LOC Reimbursement Agreement) of the
Debt Service Reserve Letter of Credit or (B) the amount
of such insufficiency and (ii) an appropriate certificate
with respect thereto if required by the Debt Service
Reserve Letter of Credit. The Depositary Agent shall
deposit the monies received from the Debt Service Reserve
LOC Provider in the relevant Fund or Funds.
(c) A determination as to the monies held
in the Debt Service Reserve Fund (not including any funds
held in the Debt Service Reserve Bond Sub-Fund, the Debt
Service Reserve LOC Loan Interest Sub-Fund or the Debt
Service Reserve LOC Loan Principal Sub-Fund) and/or the
aggregate maximum amount at the time available to be
drawn under the Debt Service Reserve Letter of Credit,
the then-current Debt Service Reserve Required Balance,
the ordinary course settlement amounts with respect to
all Interest Rate Protection Agreements and the interest
rate for all Additional Securities with a floating
interest rate which are not subject to Interest Rate
Protection Agreements (which interest rate for such
Additional Securities in effect at the time of
calculation shall be assumed to apply) shall be made by
the Funding Corporation or any Guarantor prior to each
Funding Date and immediately following any withdrawal of
amounts in the Debt Service Reserve Fund pursuant to
clause (b) above. As soon as practicable after making
any such determination, the Funding Corporation or any
Guarantor shall deliver to the Depositary Agent and the
Collateral Agent an officer's certificate setting forth
such determination and the then-current Debt Service
Reserve Required Balance. If such determination
indicates that the amount of the monies held in the Debt
Service Reserve Fund (not including any funds held in the
Debt Service Reserve Bond Sub-Fund, the Debt Service
Reserve LOC Loan Interest Sub-Fund or the Debt Service
Reserve LOC Loan Principal Sub-Fund) plus the aggregate
maximum amount at the time available to be drawn under
the outstanding Debt Service Reserve Letter of Credit
exceeds the then-current Debt Service Reserve Required
Balance after giving effect to a payment on any date, the
Depositary Agent shall transfer such excess monies held
in the Debt Service Reserve Fund to the Revenue Fund on
such date.
(d) Forty-five (45) days prior to the
expiration of the Debt Service Reserve Letter of Credit
delivered to the Depositary Agent in respect of the Debt
Service Reserve Fund, provided that the Debt Service
Reserve Letter of Credit has not been previously renewed,
extended or replaced, or if such day is not a Business
Day, on the next succeeding Business Day, the Depositary
Agent shall deliver to the Debt Service Reserve LOC
Provider on such date (i) a draft on the Debt Service
Reserve LOC Provider in an amount equal to the maximum
amount available to be drawn under the expiring Debt
Service Reserve Letter of Credit and (ii) an appropriate
certificate with respect thereto if required by the Debt
Service Reserve Letter of Credit. The Depositary Agent
shall deposit the monies received from the Debt Service
Reserve LOC Provider in payment of such draft in the Debt
Service Reserve Fund to be applied in accordance with
this Section 3.5.
(e) Forty-five (45) days after receipt of
notice from the Debt Service Reserve LOC Provider that
the long-term debt securities of such Debt Service
Reserve LOC Provider are rated less than "A" as
determined by S&P or "A2" as determined by Moody's, or if
such day is not a Business Day, the next succeeding
Business Day, provided that the Debt Service Reserve
Letter of Credit has not been replaced with a Debt
Service Reserve Letter of Credit issued by a new Debt
Service Reserve LOC Provider, the Depositary Agent shall
deliver to the Debt Service Reserve LOC Provider on such
date (i) a draft on the Debt Service Reserve LOC Provider
in an amount equal to the maximum amount available to be
drawn under the Debt Service Reserve Letter of Credit and
(ii) an appropriate certificate with respect thereto if
required by the Debt Service Reserve Letter of Credit.
The Depositary Agent shall deposit the monies received
from the Debt Service Reserve LOC Provider in payment of
such draft in the Debt Service Reserve Fund to be applied
in accordance with this Section 3.5.
(f) Upon receipt of a written notice from
the Debt Service Reserve LOC Provider that the Debt
Service Reserve Letter of Credit delivered to the
Depositary Agent will be terminated prior to its stated
expiration date, if, not less than five (5) Business Days
prior to the termination date as provided in such notice
of termination, the Debt Service Reserve Letter of Credit
has not been replaced with a Debt Service Reserve Letter
of Credit issued by a new Debt Service Reserve LOC
Provider, or other security reasonably acceptable to the
Depositary Agent, the Depositary Agent shall deliver to
the Debt Service Reserve LOC Provider (i) a draft on the
Debt Service Reserve LOC Provider in an amount equal to
the maximum amount available to be drawn under the
terminating Debt Service Reserve Letter of Credit and
(ii) an appropriate certificate with respect thereto if
required by the Debt Service Reserve Letter of Credit.
The Depositary Agent shall deposit the monies received
from the Debt Service Reserve LOC Provider in payment of
such draft in the Debt Service Reserve Fund to be applied
in accordance with this Section 3.5.
(g) Upon receipt of a written notice from
the Debt Service Reserve LOC Provider that interest is
due and payable, but unpaid, with respect to outstanding
Debt Service Reserve LOC Loans, the Depositary Agent
shall deliver to the Debt Service Reserve LOC Provider on
the date of such notice or as soon as practicable
thereafter (i) a draft on the Debt Service Reserve LOC
Provider in an amount equal to the amount of interest due
and payable (which, together with all drawings under the
Debt Service Reserve Letter of Credit in the current
fiscal year, shall not exceed $5,000,000 in the
aggregate) and (ii) an appropriate certificate with
respect thereto if required by the Debt Service Reserve
Letter of Credit. The Depositary Agent shall apply
monies received from the Debt Service Reserve LOC
Provider in payment of such amount of interest due and
payable.
(h) Monies deposited in the Debt Service
Reserve Bond Sub-Fund on any Funding Date shall be used
for the payment, when due and payable (whether at the
Scheduled Payment Date or otherwise), of principal and
interest with respect to any outstanding Debt Service
Reserve Bond at the next succeeding Scheduled Payment
Date falling on or within six (6) months following such
Funding Date. On any Funding Date that amounts for the
payment of principal and interest with respect to the
Debt Service Reserve Bond are due and payable and have
been requisitioned in accordance with Section 3.2(c), the
Depositary Agent shall withdraw the monies on deposit in
the Debt Service Reserve Bond Sub-Fund and remit such
monies to the agent under the Debt Service Reserve LOC
Reimbursement Agreement for such payments. In the event
that monies in the Debt Service Reserve Bond Sub-Fund
exceed the amount of money required by this Depositary
Agreement to be deposited therein after giving effect to
the payment made on such Scheduled Payment Date, the
Depositary Agent shall transfer such excess monies from
the Debt Service Reserve Bond Sub-Fund to the Revenue
Fund on such Scheduled Payment Date.
(i) Monies deposited in the Debt Service
Reserve LOC Loan Interest Sub-Fund on any Funding Date
shall be used for the payment, when due and payable
(whether at the Interest Payment Date or otherwise), of
interest with respect to any outstanding Debt Service
Reserve LOC Loans at the next succeeding Interest Payment
Date falling on or within six (6) months following such
Funding Date. On any Funding Date that amounts for the
payment of interest with respect to any Debt Service
Reserve LOC Loans are due and payable and have been
requisitioned in accordance with Section 3.2(c), the
Depositary Agent shall withdraw the monies on deposit in
the Debt Service Reserve LOC Loan Interest Sub-Fund and
remit such monies to the agent under the Debt Service
Reserve LOC Reimbursement Agreement for the payment of
such interest. In the event that monies in the Debt
Service Reserve LOC Loan Interest Sub-Fund exceed the
amount of money required by this Depositary Agreement to
be deposited therein after giving effect to the payment
made on such Interest Payment Date, the Depositary Agent
shall transfer such excess monies from the Debt Service
Reserve LOC Loan Interest Sub-Fund to the Revenue Fund on
such Interest Payment Date.
(j) Monies deposited in the Debt Service
Reserve LOC Loan Principal Sub-Fund on any Funding Date
shall be used for the payment, when due and payable
(whether at the Principal Payment Date or otherwise), of
principal with respect to any outstanding Debt Service
Reserve LOC Loans at the next succeeding Principal
Payment Date falling on or within six (6) months
following such Funding Date. On any Funding Date that
amounts for the payment of principal with respect to any
Debt Service Reserve LOC Loans are due and payable and
have been requisitioned in accordance with Section
3.2(c), the Depositary Agent shall withdraw the monies on
deposit in the Debt Service Reserve LOC Loan Principal
Sub-Fund and remit such monies to the Debt Service
Reserve LOC Provider for the payment of such principal.
In the event that monies in the Debt Service Reserve LOC
Loan Principal Sub-Fund exceed the amount of money
required by this Depositary Agreement to be deposited
therein after giving effect to the payment made on such
Principal Payment Date, the Depositary Agent shall
transfer such excess monies from the Debt Service Reserve
LOC Loan Principal Sub-Fund to the Revenue Fund on such
Principal Payment Date.
SECTION III.6 Distribution Fund. (a) On any
Funding Date that all of the conditions set forth in
Section 3.6(b) are satisfied, the Depositary Agent shall
make payments from the Distribution Fund to such Persons
as may be directed in writing by the Guarantors.
(b) The Distribution Fund will be funded
from monies transferred from the Revenue Fund after all
other then-required amounts have been paid as provided in
Section 3.2(c). Distributions may be made only from and
to the extent of monies on deposit in the Distribution
Fund. Such distributions are subject to the prior
satisfaction of the following conditions:
(i) the amounts contained in the
Principal Fund and Interest Fund shall be equal to
or greater than the aggregate principal and interest
payments next due on the Securities and (without
duplication) the Project Notes (without duplication
of interest to be paid pursuant to Section 3.1.4);
(ii) no Default or Event of Default
under the Indenture shall have occurred and be
continuing;
(iii) the Debt Service Coverage
Ratio for the preceding four (4) fiscal quarters,
measured as one (1) annual period (or, with respect
to any proposed distribution date prior to the first
anniversary of the Closing Date, for the period
commencing with the Closing Date and ending on the
first anniversary of the Closing Date, projected
results for any portion of such period (certified by
an officer of the Funding Corporation) shall be used
when actual results are not available), is equal to
or greater than 1.4 to 1.0, if such distribution
date occurs prior to the year 2000, and, if such
distribution date occurs in or subsequent to the
year 2000, is equal to or greater than 1.5 to 1.0,
as certified by an Authorized Officer of the Funding
Corporation;
(iv) the projected Debt Service
Coverage Ratio for the succeeding four (4) fiscal
quarters, measured as one (1) annual period, is
equal to or greater than 1.4 to 1.0, if such
distribution date occurs prior to the year 2000,
and, if, such distribution date occurs in or
subsequent to the year 2000, is equal to or greater
than 1.5 to 1.0, as certified by an Authorized
Officer of the Funding Corporation;
(v) the Debt Service Reserve Fund
shall have a balance equal to or greater than the
Debt Service Reserve Required Balance or a Debt
Service Reserve Letter of Credit in an amount at
least equal to (collectively with the balance, if
any, then in such Debt Service Reserve Fund) the
Debt Service Reserve Required Balance shall be
outstanding and available;
(vi) an Authorized Officer of the
Funding Corporation certifies (containing customary
assumptions and qualifications) that there are
sufficient geothermal resources to operate (A) the
Salton Sea Projects and the Partnership Projects
(other than the Zinc Project) at contract capacity
and (B) the Zinc Project at a level not materially
lower than the level contemplated in the Base Case
Projections (as adjusted pursuant to (x) an Approved
Completion Plan, (y) Section 2(j) of the Fourth
Supplemental Indenture or (z) Section 2(m) of the
Fourth Supplemental Indenture, if applicable), in
each case through the Final Maturity Date; and
(vii) Substantial Completion of each
New Project has occurred on or prior to the
Guaranteed Substantial Completion Date for such New
Project, as certified by an Authorized Officer of
the Funding Corporation; provided that,
notwithstanding that such condition is not
satisfied, distributions may be made if (A) (x) if
such condition is not satisfied with respect to the
Zinc Project, Series F Securities having an
aggregate principal amount of $140,520,000 have been
redeemed pursuant to Section 2(m) of the Fourth
Supplemental Indenture, (y) if such condition is not
satisfied with respect to Salton Sea Unit V, Series
F Securities having an aggregate principal amount of
$83,272,000 have been redeemed pursuant to Section
2(m) of the Fourth Supplemental Indenture, and (z)
if such condition is not satisfied with respect to
the Region 2/Turbo Project, Series F Securities
having an aggregate principal amount of $44,581,000
have been redeemed pursuant to Section 2(m) of the
Fourth Supplemental Indenture, or (B) for each New
Project with respect to which such condition is not
satisfied, the Funding Corporation and the
Guarantors take such actions as the Rating Agencies
require in order for the Rating Agencies to confirm
in writing to the Trustee that such failure of such
New Project to achieve Substantial Completion by the
Guaranteed Substantial Completion Date therefor or
such abandonment, as the case may be, will not
result in a Rating Downgrade, and the Rating Agen
cies issue such written confirmation; provided,
further, that this condition to distribution shall
apply with respect to any New Project only (x) after
the Guaranteed Substantial Completion Date for such
New Project, or (y) if the construction of such New
Project has been abandoned, in each case as set
forth in the Officer's Certificate delivered to the
Trustee pursuant to Section 5.21 of the Indenture.
SECTION III.7 Distribution Suspense Fund. On
any Funding Date on which any of the conditions precedent
to distributions in Section 3.6(b) are not satisfied, the
Depositary Agent shall transfer all monies held in the
Distribution Fund to the Distribution Suspension Fund;
provided, however, that, after application of the last
sentence of this Section 3.7, the Depositary Agent shall
transfer any remaining monies which were transferred to
the Distribution Suspense Fund solely because of a
failure to satisfy the condition precedent to
distributions set forth in Section 3.6(b)(vii) to one or
more of the Construction Funds for application in
accordance with Section 3.1, if so directed in an
Officer's Certificate of the Funding Corporation
delivered to the Depositary Agent. On any Business Day
thereafter on which the conditions to distributions set
forth in Section 3.6(b) are satisfied, upon delivery to
the Trustee, the Collateral Agent and the Depositary
Agent of an Officer's Certificate of the Funding
Corporation certifying that all such conditions to
distribution are now satisfied, the Depositary Agent
shall withdraw and transfer monies in the Distribution
Suspense Fund designated for such Funding Date to such
Persons as may be directed in writing by the Guarantors.
The Depositary Agent may conclusively rely on such
Officer's Certificate certifying that all conditions for
disbursement from the Distribution Fund have been met.
At any time that funds in the Revenue Fund are not
sufficient to pay any amounts which are due and payable
(other than by acceleration) and required to be paid with
proceeds of the Revenue Fund, then funds in the
Distribution Suspense Fund shall be transferred to the
Revenue Fund for distribution as provided therein.
SECTION III.8 Loss Proceeds Fund. (i) All
Loss Proceeds and Eminent Domain Proceeds received by any
Salton Sea Guarantor or, as the case may be, Partnership
Guarantor, shall be deposited in the Loss Proceeds Fund.
The Depositary Agent shall separately segregate such Loss
Proceeds and Eminent Domain Proceeds for distribution in
the manner as set forth below:
(A) In the event that the Salton Sea
Guarantors or, as the case may be, the Partnership
Guarantors, determine that the affected Salton Sea
Project or, as the case may be, Partnership Project,
cannot be rebuilt, repaired or restored to permit
operation of all or a portion of such Project on a
commercially reasonable basis following an Event of
Eminent Domain or Event of Loss, or that the Loss
Proceeds or the Eminent Domain Proceeds, together with
any other amounts that the Salton Sea Guarantors or, as
the case may be, the Partnership Guarantors, are willing
to commit or cause to be committed to such rebuilding,
repair or restoration, are not sufficient to permit such
rebuilding, repair or restoration, upon delivery to the
Depositary Agent and Collateral Agent of an officer's
certificate of the Salton Sea Guarantors or, as the case
may be, the Partnership Guarantors (containing customary
assumptions and qualifications), certifying to the
foregoing then, if such Loss Proceeds or Eminent Domain
Proceeds exceed $15,000,000, the Collateral Agent shall
deliver to the Depositary Agent an Allocation
Certificate. Upon receipt of the Allocation Certificate,
the Depositary Agent shall withdraw, transfer or
distribute the monies representing the Loss Proceeds or
the Eminent Domain Proceeds in the Loss Proceeds Fund to
the Redemption Fund.
(B) In the event that the Salton Sea
Guarantors or, as the case may be, the Partnership
Guarantors, determine not to rebuild, repair or restore
the affected Salton Sea Project or, as the case may be,
Partnership Project, following an Event of Eminent Domain
or Event of Loss, and such Loss Proceeds or Eminent
Domain Proceeds exceed $15,000,000, upon delivery to the
Depositary Agent and Collateral Agent of an officer's
certificate of the Salton Sea Guarantors or, as the case
may be, the Partnership Guarantors, certifying that the
Salton Sea Guarantors or, as the case may be, the
Partnership Guarantors, have determined not to rebuild,
repair or restore the affected Project, the Collateral
Agent shall deliver to the Depositary Agent an Allocation
Certificate. Upon receipt of the Allocation Certificate,
the Depositary Agent shall withdraw, transfer or
distribute the monies representing the Loss Proceeds or
the Eminent Domain Proceeds in the Loss Proceeds Fund to
the Redemption Fund.
(C) (1) In the event that the Salton
Sea Guarantors or, as the case may be, the Partnership
Guarantors, have determined to rebuild, repair or restore
all or a portion of the affected Salton Sea Project or,
as the case may be, Partnership Project, upon delivery to
the Depositary Agent and Collateral Agent of an officer's
certificate of the relevant Salton Sea Guarantor or, as
the case may be, Partnership Guarantor, certifying that
all or a portion, as applicable, of the Project will be
rebuilt, repaired or restored, the Depositary Agent shall
transfer the applicable Loss Proceeds or Eminent Domain
Proceeds, as the case may be, in the Loss Proceeds Fund
to the Restoration Sub-Fund. Amounts held in the
Restoration Sub-Fund shall be applied solely for the
payment of the costs of rebuilding, restoration or repair
of the affected Salton Sea Project or, as the case may
be, Partnership Project, as set forth below or as
otherwise contemplated herein. If the amount initially
deposited in the Restoration Sub-Fund with respect to any
Event of Loss or Event of Eminent Domain exceeds
$15,000,000 per Event of Loss or Event of Eminent Domain,
the relevant Salton Sea Guarantor or, as the case may be,
Partnership Guarantor, shall deliver to the Depositary
Agent, the Collateral Agent and the Trustee (x) a restora
tion budget (as amended, modified or supplemented from
time to time, the "Restoration Budget") prepared by the
relevant Salton Sea Guarantor or, as the case may be,
Partnership Guarantor, identifying all categories and
approximate amounts reasonably anticipated to be incurred
in connection with the rebuilding, restoration or repair,
together with a statement of uses of proceeds of the
Restoration Sub-Fund and any other monies necessary to
complete the rebuilding, restoration or repair, and (y) a
restoration progress payment schedule (as amended,
modified or supplemented from time to time, the
"Restoration Progress Payment Schedule") determined by
the Guarantors for the projected requisitions to be made
from the Restoration Sub-Fund.
(2) Before any withdrawal or transfer
shall be made from the Restoration Sub-Fund, there shall
be filed with the Depositary Agent with respect to each
Disbursement Date:
(I) a requisition from the relevant
Salton Sea Guarantor or, as the case may be,
Partnership Guarantor, substantially in the
form attached hereto as Exhibit C (a
"Restoration Requisition"), dated not more than
three (3) Business Days prior to such
Disbursement Date as set forth therein on which
such withdrawal and transfer is requested to be
made, signed by an Authorized Representative of
the relevant Salton Sea Guarantor or, as the
case may be, Partnership Guarantor;
(II) if the amount requested in
any consecutive twelve-month period with
respect to any Event of Loss or Event of
Eminent Domain exceeds $30,000,000 in the
aggregate for all Projects affected by such
occurrence, an Independent Engineer's Certifi
cate in the form attached hereto as Appendix I
to Exhibit C, dated not more than three
(3) Business Days prior to the Disbursement
Date; and
(III) if clause (II) above does not
apply, the Restoration Requisition shall so
state.
(3) On the Disbursement Date referred to
in Section 3.8(i)(C)(2) or as soon thereafter as
practicable following receipt of the documents described
in Sections 3.8(i)(C)(2)(I) through (III) above, the
Depositary Agent shall withdraw and transfer from the
Restoration Sub-Fund and shall pay to the relevant Salton
Sea Guarantor or, as the case may be, Partnership
Guarantor, or to Persons directed by it in writing the
amounts set forth in the Restoration Requisition.
(4) Upon completion of any rebuilding,
restoration or repair of all or a portion of the affected
Salton Sea Project or, as the case may be, Partnership
Project, there shall be filed with the Depositary Agent
and the Collateral Agent an officer's certificate of the
relevant Salton Sea Guarantor or, as the case may be,
Partnership Guarantor, certifying that the completion of
the rebuilding, restoration or repair has been performed
in accordance with standard industry practices and the
amount, if any, required in its opinion to be retained in
the Restoration Sub-Fund for the payment of any remaining
costs of rebuilding, restoration or repair not then due
and payable or the liability for payment of which is
being contested or disputed by the Salton Sea Guarantors
or the Partnership Guarantors, as the case may be, and
for the payment of reasonable contingencies following
completion of the rebuilding, restoration or repair.
Upon receipt of such officer's certificate, the
Depositary Agent shall transfer the amount remaining in
the Restoration Sub-Fund in excess of the amounts to
remain in the Restoration Sub-Fund as stated in the
officer's certificate of the Salton Sea Guarantors or, as
the case may be, Partnership Guarantors, first, to the
Salton Sea Guarantors or, as the case may be, Partnership
Guarantors, or to Persons directed by them in writing to
the extent of any amounts which have been expended in
connection with such rebuilding, restoration or repair
(as set forth in such officer's certificate) and not
previously reimbursed, and second, segregate the
remaining excess in the Restoration Sub-Fund from any
other amounts therein. If such remaining excess exceeds
$15,000,000, the Depositary Agent shall transfer all of
such monies in the Restoration Sub-Fund to the Redemption
Fund for the uses set forth in Section 3.8(i) and Section
3.9. If the remaining excess is equal to or less than
$15,000,000, the Depositary Agent shall transfer such
monies to the Revenue Fund. Thereafter, upon receipt of
an officer's certificate of the Salton Sea Guarantors or,
as the case may be, Partnership Guarantors, certifying
payment of all costs of rebuilding, restoration or repair
of the affected Project, the Depositary Agent shall
transfer any amounts remaining in the Restoration Sub-
Fund to the Revenue Fund.
(D) In the event that the Salton Sea
Guarantors or, as the case may be, Partnership
Guarantors, determine (x) in accordance with Section
3.8(i)(A) that such affected Salton Sea Project or, as
the case may be Partnership Project, cannot be rebuilt,
repaired or restored to permit operation of all or a
portion of such Project on a commercially reasonable
basis following an Event of Loss or Event of Eminent
Domain, or (y) in accordance with Section 3.8(i)(B), not
to rebuild, repair or restore the affected Salton Sea
Project or, as the case may be, Partnership Project, and
in either case such Loss Proceeds or Eminent Domain
Proceeds are equal to or less than $15,000,000, the
Depositary Agent shall withdraw and transfer such monies
to the Revenue Fund.
(ii) All Title Event Proceeds
received by the Salton Sea Guarantors or, as the case may
be, Partnership Guarantors, shall be deposited in the
Loss Proceeds Fund. The Depositary Agent shall
separately segregate such Title Event Proceeds for
distribution in the manner set forth below:
(A) Title Event Proceeds in respect of
any particular Title Event shall be transferred by
the Depositary Agent as follows: (i) the first
$25,000,000 of Title Event Proceeds shall be
transferred to the Title Event Sub-Fund; and (ii)
Title Event Proceeds exceeding $25,000,000 in
respect of such Title Event shall (a) be transferred
to the Revenue Fund (to the extent such excess
proceeds do not exceed $5,000,000) and (b) be
transferred to the Redemption Fund (to the extent
such excess proceeds exceed $5,000,000). Amounts
held in the Title Event Sub-Fund shall be applied in
an effort to remedy the Title Event and for payment
of expenses incurred in connection therewith, as set
forth below.
(B) Before any withdrawal and transfer
shall be made from the Title Event Sub-Fund, there
shall be filed with the Depositary Agent and the
Collateral Agent with respect to each Disbursement
Date a requisition from the relevant Salton Sea
Guarantor or, as the case may be, Partnership
Guarantor, substantially in the form attached hereto
as Exhibit D (a "Title Event Requisition"), dated
not more than three (3) Business Days prior to such
Disbursement Date as set forth therein on which such
withdrawal and transfer is requested to be made,
signed by an Authorized Representative of the
relevant Salton Sea Guarantor or, as the case may
be, Partnership Guarantor.
(C) On the Disbursement Date referred to
in Section 3.8(ii)(B) or as soon thereafter as
practicable following receipt of the Title Event
Requisition described in Section 3.8(ii)(B) above,
the Depositary Agent shall withdraw and transfer
from the Title Event Sub-Fund and shall pay to the
Salton Sea Guarantors or, as the case may be,
Partnership Guarantors, or Persons directed by them
in writing the amounts set forth in such Title Event
Requisition.
(D) Upon completion of the effort to
remedy the Title Event there shall be filed with the
Depositary Agent and the Collateral Agent an
officer's certificate of the Salton Sea Guarantors
or, as the case may be, Partnership Guarantors,
certifying the result of the effort to remedy the
Title Event and the amount, if any, required in
their opinion to be retained in the Title Event Sub-
Fund for the payment of any remaining expenses.
Upon receipt of the officer's certificate described
in the immediately preceding sentence, the
Depositary Agent shall transfer the amount remaining
in the Title Event Sub-Fund in excess of the amounts
to remain in the Title Event Sub-Fund, as stated in
such officer's certificate, first, to the Salton Sea
Guarantors or, as the case may be, Partnership
Guarantors, or Persons directed by them in writing
to the extent of any amounts expended in connection
with such effort to remedy and not previously
reimbursed, and second, segregate the remaining
excess in the Title Event Sub-Fund from any other
amounts therein. If such excess exceeds $5,000,000,
the Depositary Agent shall transfer all of such
monies in the Title Event Sub-Fund to the Redemption
Fund. If the remaining excess is equal to or less
than $5,000,000, the Depositary Agent shall transfer
such monies to the Revenue Fund. Thereafter, upon
receipt of an officer's certificate of the Salton
Sea Guarantors or, as the case may be, Partnership
Guarantors, certifying payment of all costs of
remedying the Title Event, the Depositary Agent
shall transfer any amounts remaining in the Title
Event Sub-Fund to the Revenue Fund.
(iii) All Performance Liquidated Damages
received by or on behalf of Minerals LLC, Power LLC,
Turbo LLC, Vulcan and Del Ranch shall be deposited in the
Loss Proceeds Fund. The Depositary Agent shall
separately segregate such Performance Liquidated Damages
for distribution in the manner set forth below:
(A) All Performance Liquidated Damages
received by or on behalf of Minerals LLC shall be
deposited into the Zinc LD Sub-Fund. If, within 90
days after any date on which any Performance
Liquidated Damages are deposited into the Zinc LD
Sub-Fund, the Depositary Agent shall have received
an officer's certificate of Minerals LLC stating
that Minerals LLC has elected to use all or a
specified portion of such Performance Liquidated
Damages to pay costs associated with the
construction of the Zinc Project in accordance with
an Approved Completion Plan, together with a copy of
such Approved Completion Plan, the Depositary Agent
shall (1) transfer the amount of Performance
Liquidated Damages specified in such officer's
certificate to the Zinc Construction Fund for
application in accordance with Section 3.1.1 and
such Approved Completion Plan and (2) transfer the
remaining portion of such Performance Liquidated
Damages (if any) to (a) if the amount of such
portion is greater than $6,000,000, to the Mandatory
Redemption Fund held by the Trustee under the
Indenture for the pro rata redemption of Series F
Securities Outstanding in accordance with Section
2(l) of the Fourth Supplemental Indenture, or (b) if
the amount of such proceeds is less than or equal to
$6,000,000, to the LD Holding Sub-Fund. If, within
90 days after the date on which any Performance
Liquidated Damages are deposited into the Zinc LD
Sub-Fund, the Depositary Agent shall not have
received an officer's certificate of Minerals LLC
stating that Minerals LLC has elected to use all or
a specified portion of such Performance Liquidated
Damages to pay costs associated with the
construction of the Zinc Project in accordance with
an Approved Completion Plan, the Depositary Agent
shall transfer such Performance Liquidated Damages
(a) if the amount of such Performance Liquidated
Damages is greater than $6,000,000, to the Mandatory
Redemption Fund held by the Trustee under the
Indenture for the pro rata redemption of Series F
Securities Outstanding in accordance with Section
2(l) of the Fourth Supplemental Indenture, or (b) if
the amount of such Performance Liquidated Damages is
less than or equal to $6,000,000, to the LD Holding
Sub-Fund.
(B) All Performance Liquidated Damages
received by or on behalf of Power LLC shall be
deposited into the Salton Sea Unit V LD Sub-Fund.
Prior to the date (the "Unit V LD Refund End Date")
on which the Salton Sea Unit V EPC Contractor shall
no longer have any rights granted by Power LLC to
receive a refund of Performance Liquidated Damages
pursuant to Section 16.6 of the Salton Sea Unit V
EPC Contract, as evidenced by an officer's
certificate of Power LLC delivered to the Depositary
Agent, all amounts on deposit in or credited to the
Salton Sea Unit V LD Sub-Fund shall be applied
solely to refund Performance Liquidated Damages to
the Salton Sea Unit V EPC Contractor in accordance
with Section 16.6 of the Salton Sea Unit V EPC
Contract. All amounts withdrawn from the Salton Sea
Unit V LD Sub-Fund to refund Performance Liquidated
Damages to the Salton Sea Unit V EPC Contractor
shall be withdrawn in accordance with the
disbursement procedure described below:
(1) As a condition precedent to any withdrawal
and transfer from the Salton Sea Unit V LD
Sub-Fund to refund Performance Liquidated
Damages to the Salton Sea Unit V EPC
Contractor there shall be filed with the
Depositary Agent, with respect to each
Disbursement Date on which any such
withdrawal and transfer is requested to be
made, an appropriately completed
requisition in the form attached hereto as
Exhibit F (a "Liquidated Damages Refund
Requisition") signed by an Authorized
Representative of Power LLC and dated not
more than five (5) days prior to, and
received by the Depositary Agent not less
than three (3) Business Days prior to,
such Disbursement Date (as such date is
set forth in such Liquidated Damages
Refund Requisition).
(2) On the Disbursement Date referred to in
clause (1) of this Section 3.8(iii)(B), or
as soon thereafter as possible following
receipt of the Liquidated Damages Refund
Requisition referred to in such clause,
the Depositary Agent shall make payments
in accordance with such Liquidated Damages
Refund Requisition. The Depositary Agent
may conclusively rely on any Liquidated
Damages Refund Requisition in making any
disbursements under this clause (2).
If, within 90 days after the Unit V LD Refund End
Date, the Depositary Agent shall have received an
officer's certificate of Power LLC stating that
Power LLC has elected to use all or a specified
portion of such Performance Liquidated Damages to
pay costs associated with the construction of Salton
Sea Unit V in accordance with an Approved Completion
Plan, together with a copy of such Approved
Completion Plan, the Depositary Agent shall (1)
transfer the amount of Performance Liquidated
Damages specified in such officer's certificate to
the Salton Sea Unit V Construction Fund for applica
tion in accordance with Section 3.1.2 and such
Approved Completion Plan and (2) transfer the
remaining portion of such Performance Liquidated
Damages (if any) to (a) if the amount of such
portion is greater than $6,000,000, to the Mandatory
Redemption Fund held by the Trustee under the
Indenture for the pro rata redemption of Series F
Securities Outstanding in accordance with Section
2(l) of the Fourth Supplemental Indenture, or (b) if
the amount of such proceeds is less than or equal to
$6,000,000, to the LD Holding Sub-Fund. If, within
90 days after the Unit V LD Refund End Date, the
Depositary Agent shall not have received an
officer's certificate of Power LLC stating that
Power LLC has elected to use all or a specified
portion of such Performance Liquidated Damages to
pay costs associated with the construction of Salton
Sea Unit V in accordance with an Approved Completion
Plan, the Depositary Agent shall transfer such
Performance Liquidated Damages (a) if the amount of
such Performance Liquidated Damages is greater than
$6,000,000, to the Mandatory Redemption Fund held by
the Trustee under the Indenture for the pro rata
redemption of Series F Securities Outstanding in
accordance with Section 2(l) of the Fourth
Supplemental Indenture, or (b) if the amount of such
Performance Liquidated Damages is less than or equal
to $6,000,000, to the LD Holding Sub-Fund.
(C) All Performance Liquidated Damages
received by or on behalf of Turbo LLC, Vulcan or Del
Ranch shall be deposited into the Region 2/Turbo LD
Sub-Fund. Prior to the date (the "Region 2/Turbo LD
Refund End Date") on which the Region 2/Turbo EPC
Contractor shall no longer have any rights granted
by Turbo LLC, Vulcan or Del Ranch to receive a
refund of Performance Liquidated Damages pursuant to
Section 16.6 of the Region 2/Turbo EPC Contract, as
evidenced by an officer's certificate of Turbo LLC,
Vulcan and Del Ranch delivered to the Depositary
Agent, all amounts on deposit in or credited to the
Region 2/Turbo LD Sub-Fund shall be applied solely
to refund Performance Liquidated Damages to the
Region 2/Turbo EPC Contractor in accordance with
Section 16.6 of the Region 2/Turbo EPC Contract.
All amounts withdrawn from the Region 2/Turbo LD Sub-
Fund to refund Performance Liquidated Damages to the
Region 2/Turbo EPC Contractor shall be withdrawn in
accordance with the disbursement procedure described
below:
(1) As a condition precedent to any withdrawal
and transfer from the Region 2/Turbo LD
Sub-Fund to refund Performance Liquidated
Damages to the Region 2/Turbo EPC
Contractor there shall be filed with the
Depositary Agent, with respect to each
Disbursement Date on which any such
withdrawal and transfer is requested to be
made, an appropriately completed
Liquidated Damages Refund Requisition
signed by an Authorized Representative of
Turbo LLC, Vulcan or Del Ranch and dated
not more than five (5) days prior to, and
received by the Depositary Agent not less
than three (3) Business Days prior to,
such Disbursement Date (as such date is
set forth in such Liquidated Damages
Refund Requisition).
(2) On the Disbursement Date referred to in
clause (1) of this Section 3.8(iii)(C), or
as soon thereafter as possible following
receipt of the Liquidated Damages Refund
Requisition referred to in such clause,
the Depositary Agent shall make payments
in accordance with such Liquidated Damages
Refund Requisition. The Depositary Agent
may conclusively rely on any Liquidated
Damages Refund Requisition in making any
disbursements under this clause (2).
If, within 90 days after the Region 2/Turbo LD
Refund End Date, the Depositary Agent shall have
received an officer's certificate of Turbo LLC,
Vulcan or Del Ranch stating that Turbo LLC, Vulcan
or Del Ranch, as the case may be, has elected to use
all or a specified portion of such Performance Liqui
dated Damages to pay costs associated with the
construction of the Region 2/Turbo Project in
accordance with an Approved Completion Plan,
together with a copy of such Approved Completion
Plan, the Depositary Agent shall (1) transfer the
amount of Performance Liquidated Damages specified
in such officer's certificate to the Region 2/Turbo
Construction Fund for application in accordance with
Section 3.1.3 and such Approved Completion Plan and
(2) transfer the remaining portion of such
Performance Liquidated Damages (if any) to (a) if
the amount of such portion is greater than
$6,000,000, to the Mandatory Redemption Fund held by
the Trustee under the Indenture for the pro rata
redemption of Series F Securities Outstanding in
accordance with Section 2(l) of the Fourth
Supplemental Indenture, or (b) if the amount of such
proceeds is less than or equal to $6,000,000, to the
LD Holding Sub-Fund. If, within 90 days after the
Region 2/Turbo LD Refund End Date, the Depositary
Agent shall not have received an officer's
certificate of Turbo LLC, Vulcan or Del Ranch
stating that Turbo LLC, Vulcan or Del Ranch has
elected to use all or a specified portion of such
Performance Liquidated Damages to pay costs
associated with the construction of the Region
2/Turbo Project in accordance with an Approved
Completion Plan, the Depositary Agent shall transfer
such Performance Liquidated Damages (a) if the
amount of such Performance Liquidated Damages is
greater than $6,000,000, to the Mandatory Redemption
Fund held by the Trustee under the Indenture for the
pro rata redemption of Series F Securities
Outstanding in accordance with Section 2(l) of the
Fourth Supplemental Indenture, or (b) if the amount
of such Performance Liquidated Damages is less than
or equal to $6,000,000, to the LD Holding Sub-Fund.
(D) As soon as possible after the date on
which all Performance Liquidated Damages required to
be transferred to the LD Holding Sub-Fund in
accordance with this Section 3.8(iii) have been so
transferred, as evidenced by an officer's
certificate of Minerals LLC, Power LLC, Turbo LLC,
Vulcan and Del Ranch delivered to the Depositary
Agent, the Depositary Agent shall calculate the
aggregate amount of Performance Liquidated Damages
then on deposit in the LD Holding Sub-Fund. If such
aggregate amount of Performance Liquidated Damages
is greater than $6,000,000, the Depositary Agent
shall transfer such Performance Liquidated Damages
to the Mandatory Redemption Fund held by the Trustee
under the Indenture for the pro rata redemption of
Series F Securities Outstanding in accordance with
Section 2(l) of the Fourth Supplemental Indenture.
If such aggregate amount of Performance Liquidated
Damages is less than or equal to $6,000,000, the
Depositary Agent shall transfer such Performance
Liquidated Damages to the Revenue Fund for
application in accordance with Section 3.2(c).
SECTION III.9 Redemption Fund. (a) The
following amounts shall be delivered to the Depositary
Agent directly for deposit into the Redemption Fund, or
if received by a Guarantor, as soon as practicable upon
receipt, in either case in accordance with this Section
3.9(a), to the extent such amounts are available for
redemption of Securities under the Indenture:
(i) certain amounts from the Loss
Proceeds Fund received by the Salton Sea Guarantors
or, as the case may be, Partnership Guarantors, in
connection with an Event of Loss, an Event of
Eminent Domain or a Title Event, to the extent such
amounts are required to be transferred to the
Redemption Fund in accordance with Section 3.8; and
all Loss Proceeds and Eminent Domain Proceeds
received as Equity Cash Flows by CEOC or VPC;
(ii) proceeds realized in connection
with a Permitted Power Contract Buy-Out;
(iii) any net cash proceeds actually
received by Magma or any of its subsidiaries from
(i) any settlement or buy-out agreement between
Magma and SCE, regarding the BRPU Award, or between
Magma and San Diego Gas and Electric, a California
corporation, regarding the BRPU Award, or (ii) a
lump sum settlement payment (whether payable in one
payment or a series of lump sum installments) of
claims made by Magma and certain of its Affiliates
in the SCE Litigation, to the extent that any such
proceeds are required to be deposited in the
Redemption Fund pursuant to the Support Letter;
(iv) proceeds of Debt which is
incurred by the Partnership Project Companies to
fund an equity distribution to any of the Partner
ship Guarantors other than the Partnership Project
Companies; and
(v) proceeds received as a result of
foreclosure on the Collateral securing the
obligations of the Guarantors following a Trigger
Event caused by an event of default under a Credit
Agreement or a Guarantee.
If any of the foregoing amounts required to be deposited
with the Depositary Agent in the Redemption Fund are
received by any Guarantor (or any Affiliate of such
Guarantor), such Guarantor shall (or shall cause any such
Affiliate to) hold such payments in trust for the
Collateral Agent and shall promptly remit such payments
to the Depositary Agent for deposit in the Redemption
Fund, in the form received, with any necessary
endorsements.
(b) The Depositary Agent shall segregate
the amounts referred to in Section 3.9(a)(i) through (v)
above for distribution in the manner set forth below:
(i) Upon the receipt of those
amounts from the Loss Proceeds Fund described in
Section 3.9(a)(i), the Depositary Agent shall so
notify the Collateral Agent and the Trustee and
shall separately segregate such monies, and the
Collateral Agent shall deliver to the Depositary
Agent an Allocation Certificate. Upon receipt of
the Allocation Certificate described in the
immediately preceding sentence, the Depositary Agent
shall withdraw, transfer or distribute the amounts
described in Section 3.9(a)(i) no later than one (1)
Business Day prior to the Redemption Date
established pursuant to Section 3.2 of the
Indenture, (x) in the case of the Securities being
redeemed, as instructed by the Allocation
Certificate referred to above, to the Mandatory
Redemption Fund held by the Trustee, for the pro-
rata redemption of Securities Outstanding by the
Trustee in accordance with Section 3.3 of the
Indenture, and (y) in the case of other Senior Debt
then being redeemed or prepaid, as instructed by the
Allocation Certificate referred to above.
(ii)(A) Upon the receipt of those
amounts described in Section 3.9(a)(ii) and, within
ninety (90) days of such receipt, an Officer's
Certificate of the Funding Corporation certifying
that the Rating Agencies have confirmed that such
Permitted Power Contract Buyout will not result in a
Ratings Downgrade, the Depositary Agent shall
transfer such amounts to the Revenue Fund.
(B) Other than as described in
Section 3.9(b)(ii)(A), upon the receipt of those
amounts described in Section 3.9(a)(ii), the
Depositary Agent shall so notify the Collateral
Agent and the Trustee and separately segregate such
monies, and the Collateral Agent shall deliver to
the Depositary Agent an Allocation Certificate.
Upon receipt of the Allocation Certificate described
in the immediately preceding sentence and if an
officer's certificate as described in Section
3.9(b)(ii)(A) has not been received within ninety
(90) days after receipt of the Permitted Power
Contract Buy-Out proceeds, the Depositary Agent
shall withdraw, transfer or distribute the amounts
described in Section 3.9(a)(ii) no later than one
(1) Business Day prior to the Redemption Date
established pursuant to Section 3.2 of the
Indenture, (x) in the case of the Securities being
redeemed, as instructed by the Allocation
Certificate referred to above, to the Mandatory
Redemption Fund held by the Trustee, for the pro
rata redemption of Securities Outstanding by the
Trustee in accordance with Section 3.3 of the
Indenture, and (y) in the case of other Senior Debt
then being redeemed or prepaid, as instructed by the
Allocation Certificate referred to above.
(iii) Upon the receipt of those
amounts described in Section 3.9(a)(iii), the
Depositary Agent shall transfer such amounts to the
Revenue Fund.
(iv) (A) Upon the receipt of those
amounts described in Section 3.9(a)(iv) and, within
ninety (90) days of such receipt, an officer's
certificate of the Partnership Guarantors certifying
that the Rating Agencies have confirmed that such
incurrence of Debt and distribution of proceeds as
an equity distribution will not result in a Ratings
Downgrade, the Depositary Agent shall transfer such
amounts to the Revenue Fund.
(B) Other than as described in
Section 3.9(b)(iv)(A), upon the receipt of those
amounts described in Section 3.9(a)(iv), the
Depositary Agent shall so notify the Collateral
Agent and the Trustee and separately segregate such
monies, and the Collateral Agent shall deliver to
the Depositary Agent an Allocation Certificate.
Upon receipt of the Allocation Certificate described
in the immediately preceding sentence, the
Depositary Agent shall withdraw, transfer or
distribute the amounts described in Section
3.9(a)(iv) hereof, no later than one (1) Business
Day prior to the Redemption Date established
pursuant to Section 3.2 of the Indenture, (x) in the
case of the Securities being redeemed, as instructed
by the Allocation Certificate referred to above, to
the Mandatory Redemption Fund held by the Trustee,
for the pro-rata redemption of Securities
Outstanding by the Trustee in accordance with
Section 3.3 of the Indenture, and (y) in the case of
other Senior Debt then being redeemed or prepaid, as
instructed by the Allocation Certificate referred to
above.
(v) Upon the receipt of those
amounts described in Section 3.9(a)(v), the
Depositary Agent shall so notify the Collateral
Agent and the Trustee and separately segregate such
monies, and the Collateral Agent shall deliver to
the Depositary Agent an Allocation Certificate which
sets forth the priorities established pursuant to
Section 6(d) of the Intercreditor Agreement. Upon
receipt of the Allocation Certificate described in
the immediately preceding sentence, the Depositary
Agent shall withdraw, transfer or distribute the
amounts described in Section 3.9(a)(v), no later
than one (1) Business Day prior to the Redemption
Date established pursuant to Section 3.2 of the
Indenture, (x) in the case of the Securities being
redeemed, as instructed by the Allocation
Certificate referred to above, to the Mandatory
Redemption Fund held by the Trustee, for the pro-
rata redemption of Securities Outstanding by the
Trustee in accordance with Section 3.3 of the Inden
ture, and (y) in the case of other Senior Debt then
being redeemed or prepaid, as instructed by the
Allocation Certificate referred to above; provided
that if the amounts described in Section 3.9(a)(v)
do not exceed $5,000,000, then such amounts shall be
transferred to the Revenue Fund.
SECTION III.10 Investment of Funds. Monies
held in any Fund created by and held under this
Depositary Agreement shall be invested and reinvested in
Permitted Investments at the written direction (which may
be in the form of a standing instruction) of an
Authorized Representative of the Funding Corporation or
any of the Guarantors; provided, however, that at any
time when (a) a Responsible Officer of the Depositary
Agent has received written notice that an Event of
Default under the Indenture shall have occurred and be
continuing or (b) an Authorized Representative of the
Funding Corporation or the Guarantors has not timely fur
nished such a written direction or, after a request by
the Depositary Agent, has not so confirmed a standing
instruction to the Depositary Agent, the Depositary Agent
shall invest such monies only in Permitted Investments
described in clause (i) of such definition of a maturity
of thirty (30) days or less. Such investments shall
mature in such amounts and have maturity dates or be
subject to redemption at the option of the holder thereof
on or prior to maturity as needed for the purposes of
such Funds, but in no event shall such investments mature
more than one (1) year after the date acquired. The
Depositary Agent shall at any time and from time to time
liquidate any or all of such investments prior to the
maturity as needed in order to effect the transfers and
withdrawals contemplated by this Depositary Agreement in
accordance with an officer's certificate of the Funding
Corporation or the Guarantors; provided that, in the
absence of timely receipt of such an officer's
certificate, the Depositary Agent shall liquidate any or
all such investments as so needed. In the event any such
investments are redeemed prior to the maturity thereof,
the Depositary Agent shall not be liable for any loss or
penalties relating thereto in the absence of gross negli
gence or willful misconduct. Any income or gain realized
from such investments shall be deposited (i) first, into
the Debt Service Reserve Fund until amounts in the Debt
Service Reserve Fund, together with the Debt Service
Reserve Letter of Credit, equal the Debt Service Reserve
Required Balance, and (ii) second, if amounts in the Debt
Service Reserve Fund, together with the Debt Service
Reserve Letter of Credit, equal the Debt Service Reserve
Required Balance, into the Revenue Fund; provided,
however, that any income or gain realized from
investments made with monies on deposit in any
Construction Fund shall be redeposited into such
Construction Fund. Any loss shall be charged to the
applicable Fund. The Depositary Agent shall not be
liable for any such loss other than by reason of its
willful misconduct or gross negligence. For purposes of
any income tax payable on account of any income or gain
on an investment, such income or gain shall be for the
account of the Guarantors or the Funding Corporation.
SECTION III.11 Disposition of Funds Upon
Retirement of Securities and Additional Securities. (a)
Upon the payment in full of the principal of, premium, if
any, and interest on any series of Securities, any
Project Note or issuance of Additional Securities such
that such series of Securities, such Project Note or
issuance of Additional Securities is no longer
outstanding, all amounts held in the Interest Fund, the
Principal Fund and the Debt Service Reserve Fund
allocated to such series of Securities, such Project Note
or issuance of Additional Securities, as the case may be,
shall upon the written direction of the Funding
Corporation or any Guarantor be transferred to the
Revenue Fund.
(b) Upon termination of the Intercreditor
Agreement and after payment in full of the principal of,
premium, if any, and interest on and all other amounts
due in respect of all the additional Permitted Debt, each
Project Note, all Securities Outstanding, all amounts
payable under the Working Capital Facility, the Debt
Service Reserve LOC Reimbursement Agreement and
termination of the Debt Service Reserve Letter of Credit
and all amounts payable to the Permitted Counterparties
under the Interest Rate Protection Agreements and after
payment in full of all Administrative Costs, and all
other amounts required to be paid hereunder, all amounts
remaining in any Fund established in Section 2.2 shall at
the written direction of the Funding Corporation be paid
by the Depositary Agent to the Funding Corporation.
SECTION III.12 Fund Balance Statements. The
Depositary Agent shall, on a monthly basis and at such
other times as the Collateral Agent or the Funding
Corporation may from time to time reasonably request,
provide to the Collateral Agent, the Guarantors and the
Funding Corporation fund balance statements in respect of
each of the Funds, sub-funds and amounts segregated in
any of the Funds. Such balance statements shall also
include deposits, withdrawals and transfers from and to
each Fund, sub-fund and segregated amount.
SECTION III.13 Trigger Events. (a) On and
after any date on which the Depositary Agent receives
written notice from the Collateral Agent pursuant to
Section 6 of the Intercreditor Agreement that a Trigger
Event has occurred (the date of receipt of such notice,
the "Trigger Event Date"), the Depositary Agent shall
thereafter accept all notices and instructions required
to be given to the Depositary Agent pursuant to the terms
of this Depositary Agreement only from the Collateral
Agent and not from any other Person and the Depositary
Agent shall not withdraw, transfer, pay or otherwise
distribute any monies in any of the Funds except pursuant
to such notices and instructions from the Collateral
Agent.
(b) On the Trigger Event Date, the Depositary
Agent shall render an accounting of all monies in the
Funds as of the Trigger Event Date to the Collateral
Agent.
(c) On and after the Trigger Event Date, the
Depositary Agent shall distribute all monies then held in
any Fund to the Collateral Agent for disposition pursuant
to Section 6 of the Intercreditor Agreement. The
proceeds of any sale, disposition or other realization
with respect to Collateral or Funding Corporation
Collateral held for the benefit of some but not all of
the Secured Parties shall be applied to the payment of
obligations owed to the parties for whose benefit the
specific Collateral or Funding Corporation Collateral was
held.
SECTION III.14 Capital Expenditure Fund. (a)
On the Series F Closing Date, $14,946,000 shall be
delivered to the Depositary Agent and deposited in the
Capital Expenditure Fund from the net proceeds of the
sale of the Series F Securities. All Equity
Contributions received by the Depositary Agent pursuant
to Section 2(d) of the Equity Commitment Agreement shall
be deposited into the Capital Expenditure Fund.
(b) Amounts held in the Capital Expenditure
Fund shall be applied solely for the payment (or
reimbursement to the extent the same shall have been
previously paid or satisfied by the relevant Guarantor)
of costs (including any interest paid) incurred in
connection with the modification, improvement, reworking,
maintenance and replacement from time to time of wells,
pipelines, gathering systems, equipment, facilities and
other capital expenditures in connection with or located
at the Partnership Projects (other than the Zinc Project
and the Region 2/Turbo Project) or the Salton Sea
Projects (other than Salton Sea Unit V) (collectively,
the "Permitted Capital Expenditures") and for the payment
of Permitted Capital Expenditures reasonably expected to
be incurred during the 30-day period following an
applicable Disbursement Date. All monies shall be
withdrawn in accordance with the disbursement procedure
hereinafter described in this Section 3.14.
(c) As a condition precedent to any withdrawal
and transfer from the Capital Expenditure Fund there
shall be filed with the Depositary Agent, with respect to
each Disbursement Date on which any such withdrawal and
transfer is requested to be made, an appropriately
completed requisition in the form attached hereto as
Exhibit E (a "Capital Expenditure Requisition") signed by
an Authorized Representative of the relevant Guarantor
and dated not more than five (5) days prior to, and
received by the Depositary Agent not less than three (3)
Business Days prior to, such Disbursement Date (as such
date is set forth in such Capital Expenditure
Requisition).
(d) On the Disbursement Date referred to in
clause (c) of this Section 3.14, or as soon thereafter as
possible following receipt of the Capital Expenditure
Requisition referred to in such clause, the Depositary
Agent shall make payments in accordance with such Capital
Expenditure Requisition. The Depositary Agent may
conclusively rely on any Capital Expenditure Requisition
in making any disbursements under this clause (d).
ARTICLE IV
DEPOSITARY AGENT
SECTION IV.1 Appointment of Depositary Agent,
Powers and Immunities. The Collateral Agent, on behalf
of the Secured Parties and the Funding Corporation under
the Intercreditor Agreement, hereby appoints the
Depositary Agent to act as its agent hereunder, with such
powers as are expressly delegated to the Depositary Agent
by the terms of this Depositary Agreement, together with
such other powers as are reasonably incidental thereto.
The Depositary Agent shall not have any duties or
responsibilities except those expressly set forth in this
Depositary Agreement. Without limiting the generality of
the foregoing, the Depositary Agent shall take all
actions as the Collateral Agent shall direct it to
perform in accordance with the express provisions of this
Depositary Agreement or as the Collateral Agent may
otherwise direct it to perform in accordance with the
provisions of this Depositary Agreement. Notwithstanding
anything to the contrary contained herein, the Depositary
Agent shall not be required to take any action which is
contrary to this Depositary Agreement or applicable law.
Neither the Depositary Agent nor any of its Affiliates
shall be responsible to any Secured Party for any
recitals, statements, representations or warranties made
by the Funding Corporation or the Guarantors contained in
this Depositary Agreement or any other Transaction
Document or in any certificate or other document referred
to or provided for in, or received by any Secured Party
under, the Indenture, this Depositary Agreement or any
other Transaction Document or for the value, validity,
effectiveness, genuineness, enforceability or sufficiency
of this Depositary Agreement or any other Transaction
Document or any other document referred to or provided
for herein or therein or for any failure by the Funding
Corporation or any Guarantor to perform its obligations
hereunder or thereunder. The Depositary Agent shall not
be required to ascertain or inquire as to the performance
by the Funding Corporation or the Guarantors of any of
its obligations under the Indenture, this Depositary
Agreement, any other Financing Document or any other
document or agreement contemplated hereby or thereby.
The Depositary Agent shall not be (a) required to
initiate or conduct any litigation or collection
proceeding hereunder or under any other Security Document
or (b) responsible for any action taken or omitted to be
taken by it hereunder (except for its own gross
negligence or willful misconduct) or in connection with
any other Security Document. Except as otherwise
provided under this Depositary Agreement, the Depositary
Agent shall take action under this Depositary Agreement
only as it shall be directed in writing by the Collateral
Agent. Whenever in the administration of this Depositary
Agreement the Depositary Agent shall deem it necessary or
desirable that a factual matter be proved or established
in connection with the Depositary Agent taking, suffering
or omitting to take any action hereunder, such matter
(unless other evidence in respect thereof is herein
specifically prescribed) may be deemed to be conclusively
proved or established by a certificate of any Authorized
Representative of the Funding Corporation or the
Guarantors, or the Collateral Agent, if appropriate. The
Depositary Agent shall have the right at any time to seek
instructions concerning the administration of this
Depositary Agreement from the Collateral Agent or any
court of competent jurisdiction. The Depositary Agent
shall have no obligation to expend or risk its own funds
or otherwise incur any financial liability in the perfor
mance of any of its duties hereunder.
SECTION IV.2 Reliance by Depositary Agent.
The Depositary Agent shall be entitled to rely upon and
shall not be bound to make any investigation into the
facts or matters stated in any certificate, officer's
certificate of the Funding Corporation or the Guarantors,
Independent Engineer's certificate, Collateral Agent's
certificate or any other notice or other document
(including any cable, telegram, telecopy or telex)
believed by it to be genuine and to have been signed or
sent by or on behalf of the proper Person or Persons, and
upon advice and statement of legal counsel, independent
accountants and other experts selected by the Depositary
Agent and shall have no liability for its actions taken
thereupon, unless due to the Depositary Agent's willful
misconduct or gross negligence. Without limiting the
foregoing, the Depositary Agent shall be required to make
payments to the Secured Parties only as set forth herein.
The Depositary Agent shall be fully justified in failing
or refusing to take any action under this Depositary
Agreement or the Intercreditor Agreement (i) if such
action would, in the reasonable opinion of the Depositary
Agent, be contrary to applicable law or the terms of this
Depositary Agreement or the Intercreditor Agreement, (ii)
if such action is not specifically provided for in this
Depositary Agreement or the Intercreditor Agreement, it
shall not have received any such advice or concurrence of
the Collateral Agent as it deems appropriate, or (iii)
if, in connection with the taking of any such action that
would constitute an exercise of remedies under this
Depositary Agreement or the Intercreditor Agreement
(whether such action is or is intended to be an action of
the Depositary Agent or the Collateral Agent), it shall
not first be indemnified to its satisfaction by the
Secured Parties (other than the Trustee (in its
individual capacity) or the Collateral Agent (in its
individual capacity) or any other agent or trustee under
any of the Financing Documents (in their respective
individual capacities)) against any and all liability and
expense which may be incurred by it by reason of taking
or continuing to take any such action. The Depositary
Agent shall in all cases be fully protected in acting, or
in refraining from acting, under this Depositary
Agreement or the Intercreditor Agreement in accordance
with a request of the Collateral Agent (to the extent
that the Collateral Agent is expressly authorized to
direct the Depositary Agent to take or refrain from
taking such action), and such request and any action
taken or failure to act pursuant thereto shall be binding
upon all the Secured Parties.
SECTION IV.3 Court Orders. The Depositary
Agent is hereby authorized, in its exclusive discretion,
to obey and comply with all writs, orders, judgments or
decrees issued by any court or administrative agency
affecting any money, documents or things held by the
Depositary Agent. The Depositary Agent shall not be
liable to any of the parties hereto or any other Secured
Party, their successors, heirs or personal
representatives by reason of the Depositary Agent's
compliance with such writs, orders, judgments or decrees,
notwithstanding that such writ, order, judgment or decree
is later reversed, modified, set aside or vacated.
SECTION IV.4 Resignation or Removal. Subject
to the appointment and acceptance of a successor
Depositary Agent as provided below, the Depositary Agent
may resign at any time by giving thirty (30) days written
notice thereof to the Collateral Agent and the Funding
Corporation or the Guarantors, provided that in the event
the Depositary Agent is also the Collateral Agent and
Trustee, it must also at the same time resign as
Collateral Agent and Trustee. The Depositary Agent may
be removed at any time with cause by the Collateral
Agent. The Funding Corporation shall have the right to
remove the Depositary Agent upon thirty (30) days' notice
to the Secured Parties with or without cause, effective
upon the appointment of a successor Depositary Agent
under this Section 4.4, which is reasonably acceptable to
the Trustee. In the event that the Depositary Agent
shall decline to take any action without first receiving
adequate indemnity from the Funding Corporation or the
Guarantors, the Secured Parties or the Collateral Agent,
as the case may be, and, having received an indemnity,
shall continue to decline to take such action, the
Collateral Agent shall be deemed to have sufficient cause
to remove the Depositary Agent. In the event that the
Depositary Agent is also the Trustee, the Collateral
Agent shall have the right to remove the Depositary Agent
with or without cause. Upon any such resignation or
removal, the Collateral Agent shall have the right to
appoint a successor Depositary Agent, which Depositary
Agent shall be reasonably acceptable to the Funding
Corporation. If no successor Depositary Agent shall have
been appointed by the Collateral Agent and shall have
accepted such appointment within thirty (30) days after
the retiring Depositary Agent's giving of notice of
resignation or the removal of the retiring Depositary
Agent, then the retiring Depositary Agent may appoint a
successor Depositary Agent, which shall be a bank or
trust company reasonably acceptable to the Collateral
Agent and the Funding Corporation. Upon the acceptance
of any appointment as Depositary Agent hereunder by the
successor Depositary Agent, (a) such successor Depositary
Agent shall thereupon succeed to and become vested with
all the rights, powers, privileges and duties of the
retiring Depositary Agent, and the retiring Depositary
Agent shall be discharged from its duties and obligations
hereunder, and (b) the retiring Depositary Agent shall
promptly transfer all Funds within its possession or
control to the possession or control of the successor
Depositary Agent and shall execute and deliver such
notices, instructions and assignments as may be necessary
or desirable to transfer the rights of the retiring
Depositary Agent with respect to the Funds to the
successor Depositary Agent. After the retiring
Depositary Agent's resignation or removal hereunder as
Depositary Agent, the provisions of this Article IV and
of Article V shall continue in effect for its benefit in
respect of any actions taken or omitted to be taken by it
while it was acting as Depositary Agent.
ARTICLE V
EXPENSES; INDEMNIFICATION; FEES
SECTION V.1 Expenses. The Funding Corporation
agrees to pay or reimburse all out-of-pocket expenses of
the Depositary Agent (including reasonable fees and
expenses for legal services) in respect of, or incident
to, the administration or enforcement of any of the
provisions of this Depositary Agreement or in connection
with any amendment, waiver or consent relating to this
Depositary Agreement.
SECTION V.2 Indemnification. The Funding
Corporation agrees to indemnify the Depositary Agent in
its capacity as such, and, in their capacity as such, its
officers, directors, shareholders, controlling persons,
employees, agents and servants (each an "Indemnified
Depositary Agent Party") from and against any and all
claims, losses, liabilities and expenses (including the
reasonable fees and expenses of counsel) growing out of
or resulting from this Depositary Agreement (including,
without limitation, performance under or enforcement of
this Depositary Agreement, but excluding any such claims,
losses or liabilities resulting from the Indemnified
Depositary Agent Party's gross negligence or willful
misconduct). This indemnity shall survive the
termination of this Depositary Agreement, and the
resignation or removal of the Depositary Agent. This
indemnity is extended in addition to, and not in
derogation or limitation of, the provisions of Section 12
of the Intercreditor Agreement.
SECTION V.3 Fees. On the Closing Date, and on
each anniversary of the Closing Date to and including the
Final Maturity Date, the Funding Corporation shall pay
the Depositary Agent an annual fee in an amount mutually
agreed on by the Funding Corporation and the Depositary
Agent.
ARTICLE VI
MISCELLANEOUS
SECTION VI.1 Amendments; Etc. No amendment or
waiver of any provision of this Depositary Agreement nor
consent to any departure by the Funding Corporation or
the Guarantors herefrom shall in any event be effective
unless the same shall be in writing and signed by the
Collateral Agent, the Depositary Agent, the Funding
Corporation and the Guarantors. Any such amendment,
waiver or consent shall be effective only in the specific
instance and for the specified purpose for which given.
SECTION VI.2 Addresses for Notices. All
notices, requests and other communications provided for
hereunder shall be in writing and, except as otherwise
required by the provisions of this Depositary Agreement,
shall be sufficiently given and shall be deemed given
when delivered or mailed by registered or certified mail,
postage prepaid, or sent by overnight delivery, telecopy,
telegram or telex, addressed to the parties as follows:
The Funding Corporation: Salton Sea Funding Corporation
302 South 36th Street
Suite 400-A
Omaha, Nebraska 68131
Telephone: (402) 341-4500
Fax: (402) 231-1658
Attention: Chief Financial
Officer
and a copy to: General Counsel
Fax: (402) 231-1658
The Salton Sea
Guarantors: c/o Salton Sea Power Company
302 South 36th Street
Suite 400-B
Omaha, Nebraska 68131
Telephone: (402) 341-4500
Fax: (402) 231-1658
Attention: Chief Financial
Officer
and a copy to: General Counsel
Fax: (402) 231-1658
The Partnership
Guarantors: c/o CalEnergy Operating
Corporation
302 South 36th Street
Suite 400-C
Omaha, Nebraska 68131
Telephone: (402) 341-4500
Fax: (402) 231-1658
Attention: Chief Financial
Officer
and a copy to: General Counsel
Fax: (402) 231-1658
The Royalty
Guarantor: Salton Sea Royalty Company
302 South 36th Street
Suite 400-D
Omaha, Nebraska 68131
Telephone: (402) 341-4500
Fax: (402) 231-1658
Attention: Chief Financial
Officer
and a copy to: General Counsel
Fax: (402) 231-1658
Collateral Agent: Chase Manhattan Bank and Trust
Company,National Association
101 California Street, #2725
San Francisco, California 94111
Telephone: (415) 954-9508
Fax: (415) 693-8850
Attention: Corporate Trust
Department
Depositary Agent: Chase Manhattan Bank and Trust
Company,National Association
101 California Street, # 2725
San Francisco, California 94111
Telephone: (415) 954-9508
Fax: (415) 693-8850
Attention: Corporate Trust
Department
SECTION VI.3 Governing Law; Terms. THIS
DEPOSITARY AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAW OF THE STATE OF CALIFORNIA.
SECTION VI.4 Headings. Headings used in this
Depositary Agreement are for convenience of reference
only and do not constitute part of this Depositary
Agreement for any purpose.
SECTION VI.5 No Third Party Beneficiaries.
The agreements of the parties hereto are solely for the
benefit of the Funding Corporation, the Guarantors, the
Collateral Agent, the Depositary Agent and the Secured
Parties and their respective successors and assigns and
no Person (other than the parties hereto and such Secured
Parties) shall have any rights hereunder.
SECTION VI.6 No Waiver. No failure on the
part of the Depositary Agent, the Collateral Agent or any
Secured Party or any of their nominees or representatives
to exercise, and no course of dealing with respect to,
and no delay in exercising, any right, power or remedy
hereunder shall operate as a waiver thereof; nor shall
any single or partial exercise by the Depositary Agent,
the Collateral Agent or any Secured Party or any of their
nominees or representatives of any right, power or remedy
preclude any further exercise thereof, or the exercise of
any other right, power or remedy.
SECTION VI.7 Severability. If any provision
of this Depositary Agreement or the application thereof
shall be invalid or unenforceable to any extent, (a) the
remainder of this Depositary Agreement and the
application of such remaining provisions shall not be
affected thereby and (b) each such remaining provision
shall be enforced to the greatest extent permitted by
law.
SECTION VI.8 Successors and Assigns. All
covenants, agreements, representations and warranties in
this Depositary Agreement by the Depositary Agent, the
Collateral Agent, the Funding Corporation and the
Guarantors shall bind and, to the extent permitted
hereby, shall inure to the benefit of and be enforceable
by their respective successors and assigns, whether so
expressed or not.
SECTION VI.9 Execution in Counterparts. This
Depositary Agreement may be executed in any number of
counterparts, each of which when so executed shall be
deemed to be an original, but all such counterparts shall
together constitute but one and the same instrument.
SECTION VI.10 Appointment of Agent. CEOC is
hereby appointed as agent and attorney-in-fact for each
Guarantor to take all actions, to give all notices and to
deliver all certificates and requisitions and the like
hereunder.
SECTION VI.11 Consequential Damages. In no
event (other than with respect to its own gross
negligence or willful misconduct) shall the Depositary
Agent be liable for special, indirect or consequential
loss or damage of any kind whatsoever (including but not
limited to lost profits), even if the Depositary Agent
has been advised of the likelihood of such loss or damage
and regardless of the form of action.
SECTION VI.12 Limitation of Liability.
Notwithstanding anything to the contrary contained in
this Depositary Agreement and the other Transaction
Documents, the liability and obligation of the Funding
Corporation or the Guarantors to perform and observe and
make good the obligations contained in this Depositary
Agreement and the other Security Documents shall not be
enforced by any action or proceeding wherein damages or
any money judgment or any deficiency judgment or any
judgment establishing any personal obligation or
liability shall be sought, collected or otherwise
obtained against any officer, director or shareholder or
related Person of the Funding Corporation or any of the
Guarantors or any Secured Party, and the Collateral
Agent, for itself and its successors and assigns, and on
behalf of the Secured Parties and the Funding
Corporation, irrevocably waives any and all right to sue
for, seek or demand any such damages, money judgment,
deficiency judgment or personal judgment against any
officer, director or shareholder or related Person of the
Funding Corporation or any of the Guarantors under or by
reason of or in connection with this Depositary Agreement
and agrees to look solely to the Funding Corporation and
the Guarantors and the security and Collateral and
Funding Corporation Collateral held under or in
connection with the Security Documents for the
enforcement of such liability and obligation of the
Funding Corporation and the Guarantors. Notwithstanding
the foregoing, the obligations of CalEnergy under the
Equity Commitment Agreement and of Magma under the
Support Letter, the Magma Assignment Agreement and the
Magma Services Agreement shall be recourse to each such
party, subject to the limitations, qualifications and
other terms of such documents.
IN WITNESS WHEREOF, the parties hereto have
caused this Depositary Agreement to be duly executed as
of the day and year first above written.
SALTON SEA FUNDING CORPORATION
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
SALTON SEA POWER GENERATION L.P.
By: SALTON SEA POWER COMPANY,
as its general partner
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
SALTON SEA BRINE PROCESSING L.P.
By: SALTON SEA POWER COMPANY,
as its general partner
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
FISH LAKE POWER COMPANY
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
SALTON SEA POWER L.L.C.
By: CE SALTON SEA INC.,
as its manager
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
VULCAN POWER COMPANY
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
CALENERGY OPERATING CORPORATION
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
BN GEOTHERMAL INC.
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
VULCAN/BN GEOTHERMAL POWER
COMPANY
By: VULCAN POWER COMPANY,
as its general partner
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
SAN FELIPE ENERGY COMPANY
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
LEATHERS, L.P.
By: CALENERGY OPERATING
CORPORATION, as its general
partner
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
CONEJO ENERGY COMPANY
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
DEL RANCH, L.P.
By: CALENERGY OPERATING
CORPORATION, as its general
partner
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
NIGUEL ENERGY COMPANY
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
ELMORE, L.P.
By: CALENERGY OPERATING CORPO
RATION, as its general
partner
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
CALENERGY MINERALS LLC
By: SALTON SEA MINERALS CORP.,
as its manager
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
CE TURBO LLC
By: MAGMA POWER COMPANY,
as its manager
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
SALTON SEA ROYALTY COMPANY
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
CHASE MANHATTAN BANK AND TRUST
COMPANY, NATIONAL ASSOCIATION,
as Depositary Agent
By:
Name:
Title:
CHASE MANHATTAN BANK AND TRUST
COMPANY, NATIONAL ASSOCIATION,
as Collateral Agent
By:
Name:
Title:
TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS 4
SECTION 1.1Capitalized Terms 4
SECTION 1.2Definitions; Construction 4
ARTICLE II
APPOINTMENT OF DEPOSITARY AGENT;ESTABLISHMENT OF
FUNDS 12
SECTION 2.1Acceptance of
Appointment of Depositary Agent 12
SECTION 2.2Establishment of Funds and Sub-Funds 13
SECTION 2.3Security Interest 14
SECTION 2.4Termination 15
ARTICLE III THE FUNDS 15
SECTION 3.1Construction Funds 15
SECTION 3.2Revenue Fund 21
SECTION 3.3Principal Fund 27
SECTION 3.4Interest Fund 28
SECTION 3.5Debt Service Reserve Fund 29
SECTION 3.6Distribution Fund 33
SECTION 3.7Distribution Suspense Fund 35
SECTION 3.8Loss Proceeds Fund 35
SECTION 3.9Redemption Fund 41
SECTION 3.10 Investment of Funds 45
SECTION 3.11 Disposition of Funds Upon Retirement of
Securities and Additional Securities 46
SECTION 3.12 Fund Balance Statements 47
SECTION 3.13 Trigger Events 47
SECTION 3.14 Capital Expenditure Fund 47
ARTICLE IV DEPOSITARY AGENT 48
SECTION 4.1Appointment of Depositary Agent, Powers
and Immunities 48
SECTION 4.2Reliance by Depositary Agent 50
SECTION 4.3Court Orders 50
SECTION 4.4Resignation or Removal 51
ARTICLE VEXPENSES; INDEMNIFICATION; FEES 52
SECTION 5.1Expenses 52
SECTION 5.2Indemnification 52
SECTION 5.3Fees 52
ARTICLE VI MISCELLANEOUS 53
SECTION 6.1Amendments; Etc 53
SECTION 6.2Addresses for Notices 53
SECTION 6.3Governing Law; Terms 55
SECTION 6.4Headings 55
SECTION 6.5No Third Party Beneficiaries 55
SECTION 6.6No Waiver 55
SECTION 6.7Severability 55
SECTION 6.8Successors and Assigns 55
SECTION 6.9Execution in Counterparts 56
SECTION 6.10 Appointment of Agent 56
SECTION 6.11 Consequential Damages 56
SECTION 6.12 Limitation of Liability 56
EXHIBIT 4.19(c)
SECOND AMENDED AND RESTATED CREDIT AGREEMENT
(PARTNERSHIP GUARANTORS)
This SECOND AMENDED AND RESTATED CREDIT AGREEMENT dated
as of October __, 1998 (this "Second Amendment") is by and
between SALTON SEA FUNDING CORPORATION, a Delaware corporation
("Funding Corporation"), as lender, and CALENERGY OPERATING
CORPORATION, a Delaware corporation (formerly known as CalEnergy
Operating Company) ("CEOC"), VULCAN POWER COMPANY, a Nevada
corporation ("VPC"), CONEJO ENERGY COMPANY, a California
corporation ("Conejo"), NIGUEL ENERGY COMPANY, a California
corporation ("Niguel"), SAN FELIPE ENERGY COMPANY, a California
corporation ("San Felipe"), BN GEOTHERMAL INC., a Delaware
corporation ("BNG"), DEL RANCH, L.P., a California limited
partnership ("Del Ranch"), ELMORE, L.P., a California limited
partnership ("Elmore"), LEATHERS, L.P., a California limited
partnership ("Leathers"), VULCAN/BN GEOTHERMAL POWER COMPANY, a
Nevada general partnership ("Vulcan"), CALENERGY MINERALS LLC, a
Delaware limited liability company ("Minerals LLC"), and CE TURBO
LLC, a Delaware limited liability company ("Turbo LLC", and
together with CEOC, VPC, Conejo, Niguel, San Felipe, BNG, Del
Ranch, Elmore, Leathers, Vulcan, and Minerals LLC, the
"Partnership Guarantors") as borrowers.
W I T N E S S E T H:
WHEREAS, Funding Corporation is a corporation
established for the sole purpose of making loans to the
Guarantors of proceeds from the issuance of notes and bonds
(collectively, the "Securities") in its individual capacity as
principal and as agent acting on behalf of the Guarantors
pursuant to the Trust Indenture, dated as of July 21, 1995,
between Funding Corporation and Chase Manhattan Bank and Trust
Company, National Association, a national banking association
organized under the laws of the United States, successor in
interest to Chemical Trust Company of California, as trustee
("Trustee"), as the same may be amended, modified or supplemented
(as so amended, modified or supplemented, including, pursuant to
that certain First Supplemental Indenture dated as of October 18,
1995, that certain Second Supplemental Indenture dated as of June
20, 1996, that certain Third Supplemental Indenture dated as of
July 29, 1996, and that certain Fourth Supplemental Indenture
dated as of even date herewith, the "Indenture"); and
WHEREAS, the principal and interest payments on the
Securities will be serviced by repayment of loans made by Funding
Corporation to the Guarantors and guaranteed by the Guarantors,
subject to the conditions set forth in the Indenture; and
WHEREAS, on July 21, 1995 the Funding Corporation
issued and sold Securities in the aggregate principal amount of
$475,000,000 (the "Initial Securities"); and
WHEREAS, Funding Corporation used a portion of the
proceeds from the sale of the Initial Securities to make a loan
to CEOC and VPC pursuant to that certain Credit Agreement
(Partnership Guarantors) dated as of July 21, 1995 between
Funding Corporation, CEOC and VPC (the "Initial Partnership
Credit Agreement") in the aggregate amount of $75,000,000 (the
"Initial Partnership Project Loan") portions of which were used:
(a) to repay certain non-recourse indebtedness incurred by
CalEnergy in connection with the acquisition of Magma Power
Company; and (b) to pay certain costs of issuing the Initial
Securities; and
WHEREAS, on June 20, 1996 the Funding Corporation
issued and sold Securities in the aggregate principal amount of
$135,000,000 (the "Supplemental Securities"); and
WHEREAS, Funding Corporation used a portion of the
proceeds from the sale of the Supplemental Securities to make a
loan to the Initial Partnership Guarantors and Conejo, Niguel,
San Felipe, BNG, Del Ranch, Elmore, Leathers and Vulcan
(collectively, the "Supplemental Partnership Guarantors") in the
aggregate amount of $135,000,000 (the "Supplemental Partnership
Project Loan"), portions of which were used for the following
purposes: (a) approximately $96,000,000 to refinance all existing
project-level indebtedness of the Partnership Project Companies,
(b) approximately $15,000,000 to fund certain capital
improvements to the Partnership Projects and the Salton Sea
Projects, and (c) approximately $23,000,000 to fund a portion of
the purchase price for the acquisition by certain of the
Partnership Guarantors of the 50% interest in each of the
Partnership Projects previously owned by a third party; and
WHEREAS, in connection with the making of the
Supplemental Partnership Project Loan, each Initial Partnership
Guarantor and each Supplemental Partnership Guarantor agreed to
become jointly and severally liable with each other for the
entire amount of the Initial Partnership Project Loan; and
WHEREAS, in order to evidence and implement the making
of the Supplemental Partnership Project Loan and the addition of
the Supplemental Partnership Guarantors as borrowers under the
Initial Partnership Project Loan, Funding Corporation, the
Initial Partnership Guarantors and the Supplemental Partnership
Guarantors entered into that certain Amended and Restated Credit
Agreement (Partnership Guarantors) dated as of June 20, 1996 (the
"Supplemental Partnership Credit Agreement") to amend and restate
the Initial Partnership Credit Agreement (the Initial Partnership
Credit Agreement, as so amended, the "Existing Partnership Credit
Agreement"); and
WHEREAS, Funding Corporation has simultaneously with
the execution and delivery of this Second Amendment issued and
sold Securities in the aggregate principal amount of $285,000,000
(the "New Securities"); and
WHEREAS, Funding Corporation intends to use the
proceeds from the New Securities to make a loan to the
Partnership Guarantors in the amount of $201,728,000 (the
"Additional Partnership Project Loan," and together with the
Initial Partnership Project Loan and the Supplemental Partnership
Project Loan, the "Partnership Project Loan"), portions of which
will be used for the following purposes: (a) approximately
$140,520,000 to finance the construction of an approximately
30,000 metric tonnes/year zinc recovery facility (the "Zinc
Recovery Project") which will extract and process metallic zinc
from the geothermal brine used by the Salton Sea Projects and the
Partnership Projects, to be owned and operated by Minerals LLC,
(b) approximately $36,617,000 to finance an upgrade of the brine
processing facilities at the Vulcan Project and the Del Ranch
Project (the "Region 2 Brine Facilities Construction"),
(c) approximately $7,964,000 to finance the construction of a
turbo expander (the "TurboExpander Project") to be owned by Turbo
LLC which will produce approximately 10MW of electricity from
geothermal energy, and (d) approximately $16,627,000 to fund
certain capital improvements to the Partnership Projects and the
Salton Sea Projects.
WHEREAS, in connection with the making of the
Additional Partnership Project Loan, each Partnership Guarantor
(including Minerals LLC and Turbo LLC) has agreed to become
jointly and severally liable with each other Partnership
Guarantor for the entire amount of the Initial Partnership
Project Loan and the Supplemental Partnership Project Loan; and
WHEREAS, in order to evidence and implement the making
of the Additional Partnership Project Loan and the addition of
Minerals LLC and Turbo LLC as borrowers under the Initial
Partnership Project Loan and the Supplemental Partnership Project
Loan, the parties hereto have agreed to amend and restate the
Existing Partnership Credit Agreement as set forth herein.
NOW, THEREFORE, for and in consideration of the
premises and the mutual covenants hereinafter contained, the
parties hereto formally covenant, agree and bind themselves as
follows:
ARTICLE 1.
DEFINITIONS AND AMENDMENT
Section 1.1. Definitions.
Capitalized terms used and not otherwise defined herein shall
have the meanings ascribed thereto in Exhibit A to the Indenture,
which Exhibit A is hereby incorporated by this reference.
Section 1.2. Second Amendment and Restatement.
From and after the date hereof, the terms of the Existing
Partnership Credit Agreement shall be amended to read in their
entirety as set forth in this Second Amendment and the terms of
this Second Amendment shall govern and control the rights and
obligations of the parties in and with respect to the Partnership
Project Loan, notwithstanding any conflict between the terms of
this Second Amendment and the terms of the Existing Partnership
Credit Agreement. As amended and restated by this Second
Amendment, the Existing Partnership Credit Agreement shall be
referred to herein as the "Agreement."
ARTICLE 2.
DESCRIPTION OF THE LOAN
Section 2.1. Acknowledgments of the Partnership Guarantors;
Partnership Project Loan.
The Partnership Guarantors hereby acknowledge and agree that:
(a) The Partnership Guarantors are indebted to
Funding Corporation for all principal, interest, and other
amounts currently outstanding on the Initial Partnership Project
Loan and the Supplemental Partnership Project Loan;
(b) Pursuant to this Agreement, Funding
Corporation does hereby lend to the Partnership Guarantors and
the Partnership Guarantors do hereby borrow from Funding
Corporation the principal amount of the Additional Partnership
Project Loan;
(c) The Partnership Project Loan shall be
evidenced by a promissory note or notes issued by the Partnership
Guarantors in favor of Funding Corporation (collectively, the
"Partnership Project Note"); and
(d) If proceeds from the issuance of any
Additional Securities are loaned to the Partnership Guarantors,
the outstanding principal balance on the Partnership Project Loan
shall be increased by the amount of such proceeds and the
Partnership Project Loan shall include the loan to the
Partnership Guarantors of such proceeds, as evidenced by a
promissory note issued by the Partnership Guarantors.
Section 2.2. Term of This Agreement.
This Agreement shall remain in full force and effect from the
date hereof until payment in full of all amounts due under this
Agreement.
Section 2.3. Interest.
Interest hereunder shall be paid in arrears on each May 30th
and November 30th commencing on November 30, 1998 until all
principal hereunder is paid in full. Interest shall be computed
on the basis of a three hundred sixty (360) day year, consisting
of twelve (12) thirty (30) day months and at the applicable rate
per annum specified on Schedule 1 hereto. Principal shall be
payable hereunder in an amount and on the dates set forth on
Schedule 1 hereto.
Section 2.4. Repayment.
The Partnership Guarantors shall repay the Partnership Project
Loan in installments to Funding Corporation on the dates, at the
times and in the amounts set forth on Schedule 1 attached hereto
(as the same may be modified pursuant to Section 8.3 of the
Indenture).
Section 2.5. Prepayment.
(a) Optional Prepayment
. The Partnership Guarantors shall have the optional right to
prepay the Partnership Project Loan in such amounts and at such
times as may be appropriate to permit Funding Corporation to (i)
redeem the Securities pursuant to the optional redemption
provisions set forth in Section 3.1 of the Indenture and Sections
2(i) and 2(j) of the Fourth Supplemental Indenture, dated as of
even date herewith (the "Fourth Supplemental Indenture"), between
the Funding Corporation and the Trustee, or (ii) defease the
Securities pursuant to the optional defeasance provisions set
forth in Section 10.1 of the Indenture.
(b) Mandatory Prepayment. The Partnership
Guarantors shall be required to prepay principal, and to pay
accrued interest on such prepaid principal, on the Partnership
Project Loan in such amounts and at such times as may be required
(i) to permit the Funding Corporation to redeem the Securities
pursuant to the mandatory redemption provisions set forth in
Section 3.3 of the Indenture and (ii) to permit the Funding
Corporation to redeem the New Securities pursuant to the
mandatory redemption provisions set forth in Sections 2(l) and
2(m) of the Fourth Supplemental Indenture, in each case as such
provisions apply specifically to the Partnership Guarantors, the
Partnership Projects and/or the Partnership Project Documents.
Section 2.6. Obligations of the Partnership Guarantors
Hereunder Unconditional.
The obligations of the Partnership Guarantors to make the
payments required in Sections 2.3 and 2.4 hereof shall be
absolute and unconditional; and the Partnership Guarantors shall
not discontinue such payments for any cause, including, without
limiting the generality of the foregoing, any acts or
circumstances that may constitute failure of consideration,
eviction or constructive eviction from the Partnership Projects,
destruction of or damage to the Partnership Projects, including
commercial frustration of purpose, or change in the tax or other
laws or administrative rulings of or administrative actions by
the United States of America or the State of California or any
political subdivision of either. The Partnership Guarantors may,
however, at their own cost and expense and in their own name or
in the name of Funding Corporation, prosecute or defend any
action or proceeding or take any other action involving third
persons which the Partnership Guarantors deem reasonably
necessary in order to secure or protect their rights with respect
to the Partnership Projects.
Section 2.7. General Terms of Payment.
(a) All sums payable to Funding Corporation
hereunder shall be deemed paid to the extent the Depositary Agent
shall apply amounts held by the Depositary Agent in accordance
with the Depositary Agreement to the payment of principal of or
interest on the Partnership Project Loan and the Securities in
accordance with the Depositary Agreement.
(b) Whenever any payment hereunder shall be due,
or any calculation shall be made, on a day which is not a
Business Day, the date for payment or calculation, as the case
may be, shall be extended to the next succeeding Business Day,
and any interest on any payment shall be payable for such
extended time at the specified rate.
(c) If no due date is specified for the payment
of any amount payable by the Partnership Guarantors hereunder,
such amount shall be due and payable not later than ten (10) days
after receipt of written demand by Funding Corporation to the
Partnership Guarantors for payment thereof.
Section 2.8. Security.
The obligations of the Partnership Guarantors hereunder shall
be secured as set forth herein and under the Security Documents.
ARTICLE 3.
REPRESENTATIONS AND WARRANTIES
The Partnership Guarantors represent and warrant to
Funding Corporation as follows:
Section 3.1. Organization, Power and Status of the Partnership
Guarantors.
(a) CEOC and BNG are corporations duly organized,
validly existing and in good standing under the laws of the State
of Delaware, (b) VPC is a corporation duly organized, validly
existing and in good standing under the laws of the State of
Nevada, (c) Conejo, Niguel and San Felipe are corporations duly
organized, validly existing and in good standing under the laws
of the State of California, (d) Del Ranch, Elmore and Leathers
are limited partnerships, duly organized, validly existing and in
good standing under the laws of the State of California, (e)
Vulcan is a general partnership, duly organized, validly existing
and in good standing under the laws of the State of Nevada, (f)
Minerals LLC and Turbo LLC are limited liability companies, duly
organized, validly existing and in good standing under the laws
of the State of Delaware, and (g) each of the Partnership
Guarantors is duly qualified in the State of California and is
duly authorized to do business in each other jurisdiction where
the nature of its activities makes such qualification necessary.
Each of the Partnership Guarantors has all requisite power and
authority to carry on its business as now being conducted and as
proposed to be conducted.
Section 3.2. Authorization; Enforceability; Execution and
Delivery.
(a) Each of the Partnership Guarantors has all
necessary power and authority to execute, deliver and perform its
obligations under this Agreement, the Partnership Project Note
and each other Financing Document to which it is a party.
(b) All action on the part of each of the
Partnership Guarantors that is required for the authorization,
execution, delivery and performance of this Agreement, the
Partnership Project Note and each other Financing Document to
which such Partnership Guarantor is a party have been duly and
effectively taken; and the execution, delivery and performance of
this Agreement, the Partnership Project Note and each such other
Financing Document to which any of the Partnership Guarantors is
a party does not require the approval or consent of any holder or
trustee of any Debt or other material obligations of the
Partnership Guarantors which has not been obtained.
(c) This Agreement, the Partnership Project Note
and each other Financing Document to which any of the Partnership
Guarantors is a party have been duly authorized, executed and
delivered by the Partnership Guarantors. Each of this Agreement,
the Partnership Project Note and each other Financing Document to
which any of the Partnership Guarantors is a party constitutes a
legal, valid and binding obligation of such Partnership Guarantor
enforceable against such Partnership Guarantor in accordance with
the terms hereof and thereof, except as the enforceability
thereof may be limited by bankruptcy, insolvency, or similar laws
affecting creditors' rights generally, and subject to general
principles of equity.
Section 3.3. No Conflicts; Laws and Contracts; No Default;
Representations and Warranties.
(a) Neither the execution, delivery and
performance of this Agreement, the Partnership Project Note or
any other Financing Document to which any of the Partnership
Guarantors is a party, nor the consummation of any of the
transactions contemplated hereby or thereby (i) contravenes any
provision of Law applicable to any of the Partnership Guarantors
or any of the Collateral, except any contravention which,
individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect, (ii) conflicts
or is inconsistent with or constitutes a default under the
articles of incorporation, by-laws, certificate of formation,
limited liability company operating agreement, or partnership
agreement of any of the Partnership Guarantors, or of any other
terms of any Partnership Project Document, Financing Document or
any other agreement or instrument to which the Partnership
Guarantors may be subject except any such conflict,
inconsistency, default or violation which, individually or in the
aggregate, could not reasonably be expected to result in a
Material Adverse Effect or (iii) results in the creation or
imposition of (or the obligation to create or impose) any Liens
(other than Permitted Liens) on the Partnership Collateral.
(b) Each of the Partnership Guarantors is in
compliance with any and all Laws applicable to it, except any
such noncompliance which, individually or in the aggregate, could
not reasonably be expected to result in a Material Adverse
Effect.
Section 3.4. Litigation.
There are no claims, actions, suits, investigations or
proceedings at law or in equity (including any Environmental
Claims) or by or before any arbitrator or Governmental Authority
now pending against any of the Partnership Guarantors or, to the
best knowledge of any of the Partnership Guarantors after due
inquiry, threatened against any of the Partnership Guarantors or
any property or other assets or rights of the Partnership
Guarantors that could reasonably be expected to result in a
Material Adverse Effect.
Section 3.5. Environmental Matters.
To the best knowledge of the Partnership Guarantors after due
inquiry, the Partnership Projects are in compliance with all
existing applicable Environmental Laws and there are no facts,
circumstances or conditions under any existing Environmental Law
which could, individually or in the aggregate with all other
circumstances or conditions, reasonably be expected to result in
a Material Adverse Effect.
Section 3.6. Employee Benefit Plans.
Each Plan (including without limitation each Plan of a Commonly
Controlled Entity) as to which the Partnership Guarantors may
have any liability complies with all applicable requirements of
Law and regulations, and (i) no "reportable event" (as defined in
Section 4043 of ERISA (other than an event not subject to the
notice requirement of the PBGC)) has occurred with respect to any
such Plan, (ii) there has been no withdrawal from any
Multiemployer Plan or steps taken to do so that have resulted or
could reasonably be expected to result in material liability for
the Partnership Guarantors, (iii) no Plan has been terminated or
has commenced to be terminated which could reasonably be expected
to result in material liability for the Partnership Guarantors,
(iv) no contribution failure has occurred with respect to any
Plan sufficient to give rise to a lien under Section 302(f) of
ERISA or Section 412 of the Code and (v) no condition exists or
event or transaction has occurred with respect to any Plan that,
in each case, could reasonably be expected to result in a
Material Adverse Effect.
Section 3.7. Business of the Partnership Guarantors.
Except as otherwise permitted in this Agreement and the other
Financing Documents, none of the Partnership Guarantors is
engaged in any business other than the development, acquisition,
construction, operation and financing of the Projects and
transactions related thereto or as permitted under Section 4.7
hereof.
Section 3.8. Valid Title.
Each of the Partnership Guarantors has valid legal title to all
of its assets.
Section 3.9. Security Interests.
The security interests to be transferred to and/or to be
created in favor of Funding Corporation hereunder and under the
Security Documents will be, to the extent provided herein and
therein, valid and perfected first priority security interests in
and liens on the collateral described therein.
Section 3.10. Utility Regulation.
None of the Partnership Guarantors is subject to regulation by
any Governmental Authority under PUHCA as a "public utility
company" or an "affiliate," or "subsidiary company" of a
"registered holding company" or a company subject to registration
under PUHCA.
Section 3.11. Qualifying Facility.
The Partnership Projects (other than the Zinc Recovery Project
and the TurboExpander Project) are Qualifying Facilities. The
TurboExpander Project is (a) a Qualifying Facility or (b) an
Eligible Facility owned by an Exempt Wholesale Generator.
Section 3.12. Investment Company Act.
None of the Partnership Guarantors is, and following the
execution of the Partnership Project Note, will be, an
"investment company" or, to its knowledge, an entity "controlled"
by an "investment company" as such terms are defined in the
Investment Company Act of 1940, as amended.
Section 3.13. No Defaults.
None of the Partnership Guarantors is in default under any
Project Documents or other material project contract which could
reasonably be expected to result in a Material Adverse Effect.
To the best of the Partnership Guarantors' knowledge, no material
default exists by any other party to the Project Documents or
other material project contracts.
Section 3.14. Governmental Approvals.
All Governmental Approvals which are required to be obtained
by, in the name of or on behalf of any of the Partnership
Guarantors or, to the knowledge of any of the Partnership
Guarantors, any other party to any Financing Document, in
connection with (a) the issuance of the Partnership Project Note
and (b) the execution, delivery and performance by the
Partnership Guarantors and any other party to any Financing
Document of the Financing Documents, have been duly obtained or
made, are validly issued and are in full force and effect.
Section 3.15. Margin Stock.
None of the Partnership Guarantors is engaged, directly or
indirectly, principally, or as one of its important activities,
in the business of extending, or arranging for the extension of,
credit for the purposes of purchasing or carrying any margin
stock, within the meaning of Regulation G, T, U or X of the Board
of Governors of the Federal Reserve System. No part of the
proceeds of any loan made under this Agreement will be used for
"purchasing" or "carrying" any "margin stock" as so defined, or
for extending credit to others for the purpose of purchasing or
carrying margin stock, or for any purpose which would violate, or
cause a violation of, any such regulation.
Section 3.16. Taxes.
The Partnership Guarantors have filed all federal and state tax
returns, to date, required to be filed by applicable laws and
have paid all federal and state taxes due under such tax returns
except to the extent that such taxes are being contested in good
faith and by appropriate proceedings and adequate reserves, bonds
or other security have been established with respect thereto.
Section 3.17. Ownership of Partnership Guarantors.
As of the date of this Agreement, (a) Magma and Funding
Corporation are the sole shareholders of CEOC and VPC, (b) CEOC
and Conejo are the sole general partners of Del Ranch, and Magma
and Conejo are the sole limited partners of Del Ranch, (c) CEOC
and Niguel are the sole general partners of Elmore, and Magma and
Niguel are the sole limited partners of Elmore, (d) CEOC and San
Felipe are the sole general partners of Leathers, and Magma and
San Felipe are the sole limited partners of Leathers, (e) VPC and
BNG are the sole general partners of Vulcan, (f) CEOC is the sole
shareholder of each of Conejo, Niguel, and San Felipe, (g) VPC is
the sole shareholder of BNG, (h) SSMC and Magma are the sole
members of Minerals LLC, and (i) CESS and Magma are the sole
members of Turbo LLC.
Section 3.18. Disclosure.
Each of the Series D and E Preliminary Offering Circular and
the Series D and E Final Offering Circular as of its date did
not, and the Series D and E Final Offering Circular (as the same
may have been amended or supplemented) as of the date of the
issuance of the Series D and E Securities did not, contain any
untrue statement of a material fact or omit to state any material
fact necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading.
Each of the Series F Preliminary Offering Circular and the Series
F Final Offering Circular as of its date did not, and the Series
F Final Offering Circular (as the same may have been amended or
supplemented) as of the date of the issuance and delivery of the
New Securities will not, contain any untrue statement of a
material fact with respect to the Partnership Guarantors or omit
to state any material fact necessary to make the statements made
therein with respect to the Partnership Guarantors, in the light
of the circumstances under which they were made, not misleading.
ARTICLE 4.
COVENANTS AND AGREEMENTS OF THE PARTNERSHIP GUARANTORS
Each Partnership Guarantor hereby covenants and agrees
that from the date of this Agreement, it shall faithfully observe
and fulfill, and shall cause to be fulfilled and observed, each
of the following covenants that is applicable to such Partnership
Guarantor until all amounts due under the Securities and the
Indenture shall have been repaid.
Section 4.1. Reporting Requirements.
Each of the Partnership Guarantors shall provide to Funding
Corporation (a) unaudited quarterly reports for the first three
quarters of each fiscal year containing condensed financial
information within forty-five (45) days of the end of each
quarter and audited annual reports within ninety (90) days of the
end of each fiscal year, (b) all other information in respect of
the Partnership Guarantors requested by Funding Corporation to
enable Funding Corporation to meet its obligations under the
Indenture, (c) copies of material notices delivered in connection
with any Partnership Project Documents, and (d) written notice of
any Credit Agreement Default or Event of Default under this
Agreement or any event or condition that could reasonably be
expected to result in a Material Adverse Effect.
Section 4.2. Sale of Assets.
Except as contemplated by the Partnership Project Documents,
none of the Partnership Guarantors shall sell, lease (as lessor)
or transfer (as transferor) any property or assets material to
the operation of the Partnership Projects except in the ordinary
course of business to the extent that such property is no longer
useful or necessary in connection with the operation of the
Partnership Projects; provided, however, without limiting the
generality of the foregoing, that the Partnership Guarantors
shall be allowed to lend useful spare parts to the Salton Sea
Guarantors for use in the Salton Sea Projects or to other
Permitted Facilities financed with Permitted Debt for use in such
Permitted Facilities.
Section 4.3. Sale of Partnership Interests.
Neither CEOC nor VPC shall sell, transfer or convey any of
their partnership interests in the Partnership Project Companies.
Section 4.4. Insurance.
Except as set forth below, the Partnership Project Companies
shall maintain or cause to be maintained (a) on the date hereof
the insurance in effect with respect to the Partnership Projects
on the date hereof and (b) insurance as is generally carried by
companies engaged in similar businesses and owning similar
properties in the same general areas and financed in a similar
manner. The Partnership Project Companies have business
interruption insurance, casualty insurance, including flood and
earthquake coverage, and primary and excess liability insurance,
as well as customary worker's compensation and automobile
insurance. The Partnership Project Companies shall not reduce or
cancel such insurance coverages (or permit any such coverages to
be reduced or canceled) if the Insurance Consultant determines
that (i) such reduction or cancellation would not be reasonable
under the circumstances and (ii) the insurance coverages sought
to be reduced or canceled are available on commercially
reasonable terms or that another level of coverage greater than
that proposed by the Partnership Project Companies is available
on commercially reasonable terms (in which case such coverage may
be reduced to such greater available levels).
Section 4.5. QF Status.
The Partnership Project Companies shall operate and maintain
the Partnership Projects (other than the Zinc Recovery Project
and the TurboExpander Project) as Qualifying Facilities unless
the failure to do so operate and maintain such Projects as
Qualifying Facilities would not cause or result in (a) a breach
of the power purchase agreements that the Partnership Project
Companies are party to or (b) an adverse effect on the revenues
to be received under such power purchase agreements. The
Partnership Guarantors shall operate and maintain the
TurboExpander Project as a Qualifying Facility or as an Eligible
Facility owned by one or more Exempt Wholesale Generators unless
the failure to so maintain or operate the TurboExpander Project
could not reasonably be expected to have a Material Adverse
Effect.
Section 4.6. Governmental Approvals; Title.
Each of the Partnership Guarantors shall at all times (a)
obtain and maintain in full force and effect all material
Governmental Approvals and other consents and approvals required
at any time in connection with its business and (b) preserve and
maintain good and valid title to its properties and assets
(subject to no liens other than Permitted Liens), except in each
case where the failure to do so in clause (a) or (b) could not
reasonably be expected to have a Material Adverse Effect.
Section 4.7. Nature of Business.
None of the Partnership Guarantors shall engage in any business
other than their existing businesses and, in the case of the
Partnership Project Companies, the development, acquisition,
construction, operation and financing of the Partnership Projects
as contemplated by the Transaction Documents; provided, however,
that (a) CEOC shall be permitted to enter into agreements to
provide operating and maintenance services, administrative
services, technical services or related services for Permitted
Facilities owned in whole or in part by CalEnergy (directly or
indirectly) and located in Imperial County, California and (b)
the Partnership Guarantors may engage in Permitted Facilities at
the SSKGRA (i)(A) for which Permitted Debt may be incurred and
(B) if the Independent Engineer certifies that such other
projects could not reasonably be expected to have an adverse
impact on the geothermal resources for the Salton Sea Projects or
the Partnership Projects or (ii) if Funding Corporation and the
Guarantors take such action as the Rating Agencies require to
confirm the Investment Grade Rating of the Securities.
Section 4.8. Compliance With Laws.
Each of the Partnership Guarantors shall comply with all
applicable laws, except where non-compliance could not reasonably
be expected to have a Material Adverse Effect.
Section 4.9. Prohibition on Fundamental Changes.
None of the Partnership Guarantors shall enter into any
transaction of merger or consolidation, change its form of
organization or its business, liquidate or dissolve itself (or
suffer any liquidation or dissolution); provided, however, that
any Guarantor shall be able to merge with or into any other
Guarantor so long as no Default or Event of Default exists or
shall occur as a result thereof and in the event that any of the
Partnership Guarantors is not the surviving entity (i) the
surviving entity shall, simultaneously with such merger, assume
all the obligations of such Partnership Guarantor under this
Agreement and under the other Financing Documents to which such
Partnership Guarantor was a party, (ii) Funding Corporation shall
have received appropriate amendments to this Agreement and the
other Financing Documents to which such Partnership Guarantor was
a party, all financing statements necessary to preserve its
valid, perfected, first priority security interest in the
Partnership Collateral, each in form and substance reasonably
satisfactory to Funding Corporation, (iii) after giving effect to
such merger, the merger shall not result in a Material Adverse
Effect and (iv) after giving effect to such merger, no Credit
Agreement Event of Default or Event of Default shall have
occurred or be continuing. None of the Partnership Guarantors
shall purchase or otherwise acquire all or substantially all of
the assets of any other Person, except for the purchase or
acquisition by the Partnership Guarantors of the partnership
interests or assets of the Partnership Projects not currently
owned by the Partnership Guarantors; provided, however, that the
Partnership Guarantors may engage in Permitted Facilities at the
SSKGRA (a) for which Permitted Debt may be incurred or (b) if the
Independent Engineer certifies that such other projects could not
reasonably be expected to have an adverse impact on the
geothermal resources for the Salton Sea Projects or the
Partnership Projects or (c) if Funding Corporation and the
Guarantors take such action as the Rating Agencies require to
confirm the Investment Grade Rating of the Securities.
Section 4.10. Revenue Fund.
Each of the Partnership Guarantors shall take all actions as
may be necessary to cause revenues of the Partnership Guarantors
to be deposited in the Revenue Fund, the Zinc Construction Fund
or the Region 2/Turbo Construction Fund, as applicable, in each
case in accordance with the terms of the Depositary Agreement.
Section 4.11. Transactions With Affiliates.
None of the Partnership Guarantors shall enter into any
transaction or agreement with any Affiliate of the Partnership
Guarantors other than (a) as contemplated under the Transaction
Documents or (b) transactions in the ordinary course of business
and on terms no less favorable to the Partnership Guarantors than
the Partnership Guarantors would obtain in an arms length
transaction with a Person that is not an Affiliate of the
Partnership Guarantors.
Section 4.12. Restricted Payments.
The Partnership Guarantors shall not make any Restricted
Payments except (a) as permitted under the Depositary Agreement
or as contemplated in the Offering Circular to occur on the
Closing Date and (b) in respect of Operating and Maintenance
Costs.
Section 4.13. Exercise of Rights Under Partnership Project
Documents.
None of the Partnership Guarantors shall exercise, or fail to
exercise, their rights under the partnership agreements of each
of the Partnership Project Companies (other than Minerals LLC and
Turbo LLC) or any of the Partnership Project Documents in a
manner which could reasonably be expected to result in a Material
Adverse Effect.
Section 4.14. Amendments to Contracts.
Neither CEOC nor VPC shall terminate, amend, replace or modify
(other than immaterial amendments or modifications as certified
by the Partnership Gurantors) the partnership agreement of any of
the Partnership Project Companies or the Partnership Project
Documents to which it is a party unless such termination,
amendment, replacement or modification (a) could not reasonably
be expected to have a Material Adverse Effect or (b) is required
under applicable law or to maintain the Qualifying Facility
status of a Project. In addition, none of the Partnership
Guarantors shall terminate, amend, replace or modify (other than
immaterial amendments or modifications as certified by the
Partnership Guarantors) any of the Partnership Project Documents
to which it is a party (other than a Permitted Power Contract Buy-
Out) unless (i)(A) such Partnership Guarantor certifies that such
termination, amendment, replacement or modification could not
reasonably be expected to have a Material Adverse Effect and (B)
in the case of any amendment, termination or modification of any
Power Purchase Agreement which affects the revenues derived by
any of the Partnership Guarantors, the Independent Engineer
certifies that such amendment, termination or modification could
not reasonably be expected to have a Material Adverse Effect, (b)
the Partnership Guarantors provide a letter from the Rating
Agencies confirming that such amendment, termination or
modification shall not result in a Rating Downgrade, or (c) such
amendment, termination or modification is required under
applicable law or to maintain the Qualifying Facility status of a
Project.
Section 4.15. Limitations on Debt/Liens.
The Partnership Guarantors shall not create or incur or suffer
to exist any Debt except Permitted Guarantor Debt. The
Partnership Guarantors shall not grant, create, incur or suffer
to exist any Liens upon any of their properties, except for
Permitted Liens.
Section 4.16. Books and Records.
The Partnership Guarantors shall maintain their books and
records and give the Funding Corporation, the Trustee, the
Collateral Agent and the Independent Engineer inspection rights.
Section 4.17. Additional Project Documents.
The Partnership Guarantors shall perform and observe their
respective covenants and obligations under all of the Partnership
Project Documents in all material respects except where the
failure to do so could not reasonably be expected to result in a
Material Adverse Effect. The Partnership Project Companies shall
not enter into any Additional Project Document if entering into
such document could reasonably be expected to result in a
Material Adverse Effect.
Section 4.18. Maintenance of Existence.
The Partnership Guarantors shall at all times preserve and
maintain in full force and effect (a) their existence as limited
partnerships, limited liability companies, corporations or a
general partnership, as applicable, in good standing under the
laws of the State of California, Nevada or Delaware, as
applicable, (b) their qualification to do business in each
jurisdiction in which the character of the properties owned or
leased by them or in which the transaction of their business as
conducted or proposed to be conducted makes such qualification
necessary, and (c) all of their powers, rights, privileges and
franchises which are necessary for the ownership and operation of
their respective businesses.
Section 4.19. Taxes.
The Partnership Guarantors shall pay and discharge all taxes,
assessments and governmental charges upon them, their income and
their properties prior to the date on which penalties are
attached thereto, unless and to the extent only that (a) such
taxes, assessments and governmental charges shall be contested in
good faith and by appropriate proceedings, and (b) adequate
reserves, bonds or other security are established with respect
thereto.
Section 4.20. Additional Documents; Filings and Recordings.
The Partnership Guarantors shall execute and deliver, as
requested by Funding Corporation, such other documents as shall
reasonably be necessary or advisable in order to effect or
protect the rights and remedies of Funding Corporation granted or
provided for by this Agreement or the other Financing Documents
to which the Partnership Guarantors are party and to consummate
the transactions contemplated therein. The Partnership
Guarantors shall, at their own expense, take all reasonable
actions (a) that are requested by Funding Corporation or (b) that
an Authorized Officer of the Partnership Guarantors has actual
knowledge are necessary as a legal matter, to establish, maintain
and perfect the first priority security interests of Funding
Corporation. Without limiting the generality of the foregoing,
the Partnership Guarantors shall execute or cause to be executed
and shall file or cause to be filed such Financing Statements,
continuation statements, and fixture filings and such mortgages,
or deeds of trust in all places necessary or advisable (in the
opinion of counsel for Funding Corporation) to establish,
maintain and perfect such security interests.
Section 4.21. Information and Access to Independent Engineer.
The Partnership Guarantors shall provide the Independent
Engineer with information regarding the Zinc Recovery Project,
the Region 2 Brine Facilities Construction and the TurboExpander
Project which is reasonably requested by the Independent
Engineer. The Partnership Project Companies shall provide the
Independent Engineer with access to the Zinc Recovery Project,
the Region 2 Brine Facilities Construction and the TurboExpander
Project as reasonably requested by the Independent Engineer.
ARTICLE 5.
DEFAULT AND REMEDIES
Section 5.1. Events of Default.
Each of the following events and occurrences shall constitute a
Credit Agreement Event of Default under this Agreement:
(a) the failure by the Partnership Guarantors to
pay or cause to be paid any principal of, premium, if any, or
interest, fees or any other obligations on the Partnership
Project Note for fifteen (15) or more days after the same becomes
due and payable, whether by scheduled maturity or required
prepayment or by acceleration or otherwise, after application by
the Trustee, in accordance with the provisions of the Indenture,
of any amounts in Funding Corporation's account in the Debt
Service Reserve Fund (as defined in the Depositary Agreement) and
amounts otherwise advanced by other Guarantors for the benefit of
the Partnership Guarantors.
(b) any representation or warranty made by the
Partnership Guarantors under this Agreement shall prove to have
been untrue or misleading in any material respect as of the time
made, confirmed or furnished and the fact, event or circumstance
that gave rise to such inaccuracy could reasonably be expected to
result in a Material Adverse Effect and such fact, event or
circumstance shall continue to be uncured for thirty (30) or more
days from the date an Authorized Officer of the Partnership
Guarantors has actual knowledge thereof; provided, however, that
if the Partnership Guarantors commence efforts to cure such fact,
event or circumstance within such thirty (30) day period, the
Partnership Guarantors may continue to effect such cure and such
misrepresentation shall not be deemed a Credit Agreement Event of
Default for an additional sixty (60) days so long as the
Partnership Guarantors are diligently pursuing such cure;
(c) the failure by any of the Partnership
Guarantors to perform or observe any covenant contained in
Sections 4.2, 4.4, 4.7, 4.9, 4.12, 4.13, 4.14, 4.16, or 4.19
hereof, if any, and such failure shall continue uncured for
thirty (30) or more days after an Authorized Officer of such
Partnership Guarantor obtains actual knowledge of such failure;
(d) the failure by any of the Partnership
Guarantors to perform or observe any of the other covenants
contained in this Agreement or in the other Financing Documents
the Partnership Guarantors are party to (other than such failures
described in Sections 5.1(c) above) and such failure shall
continue uncured for sixty (60) or more days after an Authorized
Officer of the Partnership Guarantors has actual knowledge of
such failure; provided, however, that if the Partnership
Guarantors commence efforts to cure such default within such
sixty (60) day period, the Partnership Guarantors may continue to
effect such cure of the default and such default shall not be
deemed a Credit Agreement Event of Default for an additional
thirty (30) days so long as the Partnership Guarantors are
diligently pursuing such cure;
(e) any of the Partnership Guarantors:
(1) does not pay its Debts as they
become due or admits in writing its inability to pay its Debts or
makes a general assignment for the benefit of creditors; or
(2) commences any case, proceeding or
other action seeking reorganization, arrangement, adjustment,
liquidation, dissolution or composition of it or its debts under
any applicable liquidation, conservatorship, bankruptcy,
moratorium, arrangement, adjustment, insolvency, reorganization
or similar laws affecting the rights or remedies of creditors
generally, as in effect from time to time (collectively, "Debtor
Relief Law"); or
(3) in any involuntary case, proceeding
or other action commenced against it which seeks to have an order
for relief (injunctive or otherwise) entered against it, as
debtor, or seeks reorganization, arrangement, adjustment,
liquidation, dissolution or composition of it or its Debts under
any Debtor Relief Law, (A) fails to obtain a dismissal of such
case, proceeding or other action within sixty (60) days of its
commencement, or (B) converts the case from one chapter of the
Bankruptcy Reform Act of 1978, as amended, to another chapter, or
(C) is the subject of an order for relief; or
(4) has a trustee, receiver, custodian
or other official appointed for or take possession of all or any
part of its property or has any court take jurisdiction of any of
its property, which action remains undismissed for a period of
sixty (60) days;
(f) the entry of one or more final and non-
appealable judgment or judgments for the payment of money in
excess of Ten Million Dollars ($10 Million) (exclusive of
judgment amounts fully covered by insurance or indemnity) against
the Partnership Guarantors, which remain unpaid or unstayed for a
period of ninety (90) or more consecutive days;
(g) an event of default under any Permitted
Guarantor Debt of the Partnership Guarantors in excess of Ten
Million Dollars ($10 Million) occurs and such debt becomes due
and payable prior to its stated maturity;
(h) the Partnership Guarantors fail to perform
any of their respective payment obligations under the Partnership
Guarantee for fifteen (15) or more days after the same becomes
due and payable;
(i) any Governmental Approval required for the
operation of a Project owned by the Partnership Project Companies
is revoked, terminated, withdrawn or ceases to be in full force
and effect if such revocation, termination, withdrawal or
cessation could reasonably be expected to have a Material Adverse
Effect and such revocation, termination, withdrawal or cessation
is not cured for sixty (60) days following the occurrence
thereof;
(j) any Partnership Project Document ceases to be
valid and binding and in full force and effect other than as a
result of an amendment, termination or Permitted Power Contract
Buy-Out permitted under this Agreement, and any such event
results in a Material Adverse Effect; provided, however, that no
such event shall be a Credit Agreement Event of Default if within
one hundred eighty (180) days from the occurrence of any such
event, the Partnership Guarantors (1) cause the third party to
resume performance or cure such misrepresentation or (2) enter
into an Additional Project Document in replacement thereof, as
permitted under this Agreement;
(k) the failure of any of the Partnership
Guarantors to perform or observe any of its covenants or
obligations contained in any of the Partnership Project Documents
to which it is a party if such failure shall result in the
termination of such Partnership Project Document or otherwise
result in a Material Adverse Effect; provided, however that such
event shall not be a Credit Agreement Event of Default if within
one hundred eighty (180) days from the occurrence of any such
event, the Partnership Guarantors enter into an Additional
Project Document in replacement thereof as permitted under this
Agreement;
(l) any of the Partnership Security Documents
ceases to be effective or any Lien granted therein ceases to be a
valid and perfected Lien in favor of the Collateral Agent on the
Collateral described therein with the priority purported to be
created thereby; provided, however, that the Partnership
Guarantors shall have ten (10) days to cure any such impairment
or cessation or to furnish to the Trustee, the Collateral Agent
or the Depositary Agent all documents or instruments required to
cure any such cessation; or
(m) an Event of Default under Section 6.1 (c),
(d), (e), (f), (g), (h), (i), (j), (k) or (l) of the Indenture
occurs.
Section 5.2. Consequences of Event of Default.
If one or more Credit Agreement Events of Default under this
Agreement have occurred and are continuing, then:
(a) in the case of a Credit Agreement Event of
Default under Section 5.1(e) hereof, the entire outstanding
principal amount of the Partnership Project Note, all interest
accrued and unpaid thereon, and all premium and other amounts
payable under the Partnership Project Note and this Agreement, if
any, shall automatically become due and payable, without
presentment, demand, protest or notice of any kind; or
(b) in the case of a Credit Agreement Event of
Default under:
(1) Sections 5.1(a) or (h) hereof, upon the written
and unrescinded direction of the Holders of no less than thirty
three and one-third percent (33 1/3%) in aggregate principal
amount of the Outstanding Securities, Funding Corporation shall
declare the outstanding principal amount of the Partnership
Project Note to be accelerated and due and payable and all
interest accrued and unpaid thereon, and all premium and other
amounts payable under this Agreement, if any to be due and
payable, and
(2) Sections 5.1(b), (c), (d), (f), (g), (i), (j),
(k), (l) and (m) hereof, upon the written and unrescinded
direction of the Holders of no less than fifty percent (50%) in
aggregate principal amount of the Outstanding Securities, Funding
Corporation shall declare the outstanding principal amount of the
Partnership Project Note to be accelerated and due and payable
and all interest accrued and unpaid thereon, and all premium and
other amounts payable under this Agreement, if any to be due and
payable.
Section 5.3. Continuing Lien.
(a) The liens and security interests granted in
this Agreement, the other Financing Documents to which the
Partnership Guarantors are party and the Security Documents to
which the Partnership Guarantors are party secure all
indebtedness and all obligations of the Partnership Guarantors
owed to Funding Corporation in connection with the Partnership
Project Loan of whatever kind or character, whether now owing,
hereafter arising or hereafter to be performed.
(b) Notwithstanding anything to the contrary in
this Agreement, the other Financing Documents to which the
Partnership Guarantors are party or the Security Documents to
which the Partnership Guarantors are party, if at the time the
principal balance of the Securities is fully paid (the "Pay-off
Date"), any other amounts owed by the Partnership Guarantors
hereunder remain to be paid, Funding Corporation shall not be
obligated to release any collateral remaining subject to the
Security Documents, and such collateral shall continue to secure
the payment of such amounts remaining as of the Pay-off Date.
Section 5.4. Defense of Actions.
Upon the occurrence of a Credit Agreement Event of Default,
Funding Corporation may (but shall not be obligated to) commence,
appear in or defend any action or proceeding purporting to affect
the Partnership Project Loan, the Partnership Projects or the
respective rights and obligations of Funding Corporation and any
other person pursuant to this Agreement, any other Financing
Document to which the Partnership Guarantors are party or any
Security Document to which the Partnership Guarantors are party.
Funding Corporation may (but shall not be obligated to) pay all
necessary expenses, including reasonable attorneys' fees and
expenses, incurred in connection with such proceedings or
actions, which expenses the Partnership Guarantors hereby agree
to repay to Funding Corporation promptly upon demand.
ARTICLE 6.
GENERAL TERMS AND CONDITIONS
Section 6.1. Notices.
All notices, requests, complaints, demands, communications or
other papers shall be sufficiently given and shall be deemed
given when delivered or mailed by registered or certified mail,
postage prepaid, or sent by telegram or telex, addressed to the
parties as follows:
If to the Partnership Guarantors: CalEnergy Operating
Corporation
302 South 36th Street, Suite 400-C
Omaha, Nebraska 68131
Attention: General Counsel
Vulcan Power Company
302 South 36th Street, Suite 400-E
Omaha, Nebraska 68131
Attention: General Counsel
Conejo Energy Company
302 South 36th Street, Suite 400-G
Omaha, Nebraska 68131
Attention: General Counsel
Niguel Energy Company
302 South 36th Street, Suite 400-H
Omaha, Nebraska 68131
Attention: General Counsel
San Felipe Energy Company
302 South 36th Street, Suite 400-I
Omaha, Nebraska 68131
Attention: General Counsel
BN Geothermal Inc.
302 South 36th Street, Suite 400-J
Omaha, Nebraska 68131
Attention: General Counsel
Del Ranch, L.P.
302 South 36th Street, Suite 400-C
Omaha, Nebraska 68131
Attention: General Counsel
Elmore, L.P.
302 South 36th Street, Suite 400-C
Omaha, Nebraska 68131
Attention: General Counsel
Leathers, L.P.
302 South 36th Street, Suite 400-C
Omaha, Nebraska 68131
Attention: General Counsel
Vulcan/BN Geothermal Power
Company
302 South 36th Street, Suite 400-E
Omaha, Nebraska 68131
Attention: General Counsel
CalEnergy Minerals LLC
302 South 36th Street, Suite 400-L
Omaha, Nebraska 68131
Attention: General Counsel
CE Turbo LLC
302 South 36th Street, Suite 400-M
Omaha, Nebraska 68131
Attention: General Counsel
If to Funding Corporation: Salton Sea Funding Corporation
302 South 36th Street, Suite 400-A
Omaha, Nebraska 68131
Attention: Chief Financial
Officer
If to Moody's: Moody's Investors Service
99 Church Street
New York, New York 10007
Attention: Corporate Utilities
Department
If to S & P: Standard & Poor's Corporation
25 Broadway
New York, New York 10004
Attention: Corporate Finance
Department
Electric Utilities Group
The above parties may, by notice given hereunder, designate any
further or different addresses to which subsequent notices,
certificates or other communications shall be sent.
Section 6.2. Amendments and Waivers.
This Agreement may only be amended by a document signed by
Funding Corporation and the Partnership Guarantors. No waiver of
any provision of this Agreement nor consent by Funding
Corporation to any departure by the Partnership Guarantors
therefrom shall in any event be effective unless the same shall
be in writing and signed by Funding Corporation. Any such waiver
or consent shall be effective only in the specific instance and
for the specific purpose for which given. No failure on the part
of Funding Corporation to exercise, and no delay in exercising,
any right hereunder shall operate as a waiver thereof (except as
provided above) nor shall any single or partial exercise of any
right hereunder preclude any other or further exercise thereof or
the exercise of any other right. This Agreement shall be binding
upon the Partnership Guarantors, its successors and any permitted
assigns.
Section 6.3. Election of Remedies.
The remedies herein provided are cumulative and not exclusive
of any remedies provided by law. Funding Corporation shall have
all of the rights and remedies granted in the Financing Documents
and available at law or in equity, and these same rights and
remedies may be pursued separately, successively or concurrently
against the Partnership Guarantors, or any collateral under the
Financing Documents, at the sole discretion of Funding
Corporation.
Section 6.4. Severability.
Any provision of this Agreement which is prohibited,
unenforceable or not authorized in any jurisdiction shall, as to
such jurisdiction, be ineffective to the extent of such
prohibition, unenforceability or non-authorization, without
invalidating the remaining provisions hereof or affecting the
validity, enforceability or legality of such provision in any
other jurisdiction.
Section 6.5. Third-Party Beneficiaries; Prior Agreements.
It is intended that the Trustee, the Collateral Agent and the
Depositary Agent be, and the Trustee, the Collateral Agent and
the Depositary Agent are hereby made, third-party beneficiaries
of this Agreement. This Agreement is for the sole benefit of
Funding Corporation, the Trustee, the Holders and the Partnership
Guarantors and is not for the benefit of any other third party.
Notwithstanding the two preceding sentences, no Holder shall have
any right to pursue any remedy hereunder except through the
Trustee as permitted under Sections 6.5 and 6.6 of the Indenture.
This Agreement supersedes all prior agreements among the parties
with respect to the matters addressed herein.
Section 6.6. Partnership Guarantors in Control.
In no event shall Funding Corporation's or the Trustee's rights
and interests under this Agreement and the other Financing
Documents be construed to give Funding Corporation or the
Trustee, or be deemed to indicate that Funding Corporation or the
Trustee has, control of the business, management or properties of
the Partnership Guarantors or power over the daily management
functions and operating decisions made by the Partnership
Guarantors.
Section 6.7. Number and Gender.
Whenever used herein, the singular number shall include the
plural and the plural the singular, and the use of any gender
shall be applicable to all genders.
Section 6.8. Captions.
The captions, headings, table of contents and arrangements used
in this Agreement are for convenience only and do not and shall
not be deemed to affect, limit, amplify or modify the terms and
provisions hereof.
Section 6.9. Applicable Law and Jurisdiction.
This Agreement shall be governed by and construed and
interpreted in accordance with the laws of the State of
California.
Section 6.10. Consent.
Whenever the consent or approval of Funding Corporation or the
Partnership Guarantors is required herein, such consent or
approval shall not be unreasonably withheld or delayed.
Section 6.11. No Recourse.
Funding Corporation agrees that no general partner (except
CEOC, VPC, Conejo, Niguel, San Felipe and BNG), limited partner
(except Conejo, Niguel and San Felipe), member, officer,
director, employee or shareholder of the Partnership Guarantors
or any Affiliate of any such party (collectively, the
"Nonrecourse Parties") shall be personally liable under this
Agreement for the payment of any sums now or hereafter owing
Funding Corporation under the terms of, or for the performance of
any obligation contained in, this Agreement. Funding Corporation
agrees that its rights shall be limited to proceeding against the
Partnership Guarantors and the security provided or intended to
be provided pursuant to the Security Documents and that it shall
have no right to proceed against the Nonrecourse Parties for (a)
the satisfaction of any monetary obligation of, or enforcement of
any monetary claim against, the Partnership Guarantors, (b) the
performance of any obligation, covenant or agreement arising
under this Agreement, or (c) any deficiency judgment remaining
after foreclosure of any property securing the obligations
hereunder.
Section 6.12. Counterparts.
This Agreement may be signed in any number of counterparts,
each of which shall be an original, with the same effect as if
the signatures thereto and hereto were upon the same instrument.
Section 6.13. Successors and Assigns.
All the covenants, promises and agreements in this Agreement
contained by or on behalf of the Partnership Guarantors, or by or
on behalf of Funding Corporation, shall bind and inure to the
benefit of their respective successors and assigns, whether so
expressed or not.
Section 6.14. Joint and Several Obligations.
The obligations of the Partnership Guarantors are joint and
several.
Section 6.15. Maximum Interest Rate.
Notwithstanding any provision to the contrary contained herein
or in the Partnership Project Note, at no time shall the
Partnership Guarantors be obligated or required to pay interest
on the principal balance due hereunder or thereunder at a rate
which could be in excess of the maximum interest rate permitted
by law to be contracted or agreed to be paid. If by the terms
hereof or of the Partnership Project Note, the Partnership
Guarantors are at any time required or obligated to pay interest
in excess of such maximum rate, then the rate of interest
applicable hereunder shall be deemed to be immediately reduced to
such maximum rate and the interest payable shall be computed at
such maximum rate.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered by their respective
officers thereunto duly authorized as of the date first above
written.
PARTNERSHIP GUARANTORS:
CALENERGY OPERATING CORPORATION,
a Delaware corporation
By:/s/ Steven A. McArthur
Name: Steven A. McArthur
Title: Executive Vice President
VULCAN POWER COMPANY,
a Nevada corporation
By: /s/ Steven A. McArthur
Name: Steven A. McArthur
Title: Executive Vice President
CONEJO ENERGY COMPANY,
a California corporation
By: /s/ Steven A. McArthur
Name: Steven A. McArthur
Title: Executive Vice President
NIGUEL ENERGY COMPANY,
a California corporation
By: /s/ Steven A. McArthur
Name: Steven A. McArthur
Title: Executive Vice President
SAN FELIPE ENERGY COMPANY,
a California corporation
By: /s/ Steven A. McArthur
Name: Steven A. McArthur
Title: Executive Vice President
BN GEOTHERMAL INC.,
a Delaware corporation
By: /s/ Steven A. McArthur
Name: Steven A. McArthur
Title: Executive Vice President
DEL RANCH, L.P.,
a California limited partnership
By: CalEnergy Operating Corporation,
a Delaware corporation, its general partner
By:/s/ Steven A. McArthur
Name: Steven A. McArthur
Title: Executive Vice President
ELMORE, L.P.,
a California limited partnership
By: CalEnergy Operating Corporation,
a Delaware corporation, its general partner
By:/s/ Steven A. McArthur
Name: Steven A. McArthur
Title: Executive Vice President
LEATHERS, L.P.,
a California limited partnership
By: CalEnergy Operating Corporation,
a Delaware corporation, its general partner
By:/s/ Steven A. McArthur
Name: Steven A. McArthur
Title: Executive Vice President
VULCAN/BN GEOTHERMAL POWER COMPANY,
a Nevada general partnership
By: Vulcan Power Company,
a Nevada corporation, its general partner
By: /s/ Steven A. McArthur
Name: Steven A. McArthur
Title: Executive Vice President
CALENERGY MINERALS LLC,
a Delaware limited liability company
By:
Salton Sea Minerals Corp.,
a Delaware corporation, its manager
By: /s/ Steven A. McArthur
Name: Steven A. McArthur
Title: Executive Vice President
CE TURBO LLC,
a Delaware limited liability company
By: Magma Power Company,
a Nevada corporation, its manager
By: /s/ Steven A. McArthur
Name: Steven A. McArthur
Title: Executive Vice President
FUNDING CORPORATION:
SALTON SEA FUNDING CORPORATION,
a Delaware corporation
By: /s/ Steven A. McArthur
Name: Steven A. McArthur
Title: Executive Vice President
EXHIBIT 4.31(a)
PARTNERSHIP PROJECT NOTE (SSI)
$24,579,000 October ____, 1998
For value received, the undersigned, CALENERGY
OPERATING CORPORATION, a Delaware corporation, VULCAN POWER
COMPANY, a Nevada corporation, CONEJO ENERGY COMPANY, a
California corporation, NIGUEL ENERGY COMPANY, a California
corporation, SAN FELIPE ENERGY COMPANY, a California corporation,
BN GEOTHERMAL INC., a Delaware corporation, DEL RANCH, L.P., a
California limited partnership, ELMORE, L.P., a California
limited partnership, LEATHERS, L.P., a California limited
partnership, VULCAN/BN GEOTHERMAL POWER COMPANY, a Nevada general
partnership, CALENERGY MINERALS LLC, a Delaware limited liability
company, and CE TURBO LLC, a Delaware limited liability company
(collectively, the "Partnership Guarantors"), by this promissory
note jointly and severally promise to pay to the order of Salton
Sea Funding Corporation, a Delaware corporation ("Funding
Corporation"), at the office of Chase Manhattan Bank and Trust
Company, National Association, a national banking association
organized under the laws of the United States, located at 101
California Street, Number 2725, San Francisco, California 94111,
in lawful currency of the United States of America and in
immediately available funds, the principal amount of $24,579,000,
or if less, the aggregate unpaid and outstanding principal amount
of this Partnership Project Note advanced by Funding Corporation
to the Partnership Guarantors pursuant to that certain Second
Amended and Restated Credit Agreement (Partnership Guarantors)
dated as of the date hereof (the "Partnership Credit Agreement")
by and among the Partnership Guarantors and Funding Corporation,
as the same may be amended from time to time, and all other
amounts owed by the Partnership Guarantors to Funding Corporation
hereunder.
This Partnership Project Note is entered into pursuant
to the Partnership Credit Agreement and is entitled to the
benefits thereof and is subject to all terms, provisions and
conditions thereof. Capitalized terms used and not defined
herein shall have the meanings set forth in Exhibit A to that
certain Trust Indenture, dated as of July 21, 1995 (as the same
may be amended, modified or supplemented, including pursuant to
the First Supplemental Indenture dated as of October 18, 1995,
the Second Supplemental Indenture dated as of June 20, 1996, the
Third Supplemental Indenture dated as of July 29, 1996, and the
Fourth Supplemental Indenture dated as of the date hereof, the
"Indenture"), by and between Funding Corporation and Chase
Manhattan Bank and Trust Company, National Association, a
national banking association organized under the laws of the
United States, successor in interest to Chemical Trust Company of
California, as trustee.
Reference is hereby made to the Partnership Credit
Agreement, the Indenture and the Security Documents for the
provisions, among others, with respect to the custody and
application of the Collateral, the nature and extent of the
security provided thereunder, the rights, duties and obligations
of the Partnership Guarantors and the rights of the holder of
this Partnership Project Note.
The principal amount hereof is payable in accordance
with the Partnership Credit Agreement, and such principal amount
may be prepaid solely in accordance with the Partnership Credit
Agreement.
The Partnership Guarantors further agree to pay, in
lawful currency of the United States of America and in
immediately available funds, interest from the date hereof on the
unpaid and outstanding principal amount hereof until such unpaid
and outstanding principal amount shall become due and payable
(whether at stated maturity, by acceleration or otherwise) at the
rates of interest and at the times set forth in the Partnership
Credit Agreement, and the Partnership Guarantors agree to pay
other fees and costs as stated in the Partnership Credit
Agreement.
Upon the occurrence of any one or more Credit Agreement
Events of Default (as defined in Section 5.1 of the Partnership
Credit Agreement), all amounts then remaining unpaid under this
Partnership Project Note may become or be declared to be
immediately due and payable as provided in the Partnership Credit
Agreement, without notice of default, presentment or demand for
payment, protest or notice of nonpayment or dishonor, or notices
or demands of any kind, all of which are expressly waived by the
Partnership Guarantors.
The obligations hereunder are subject to the
limitations set forth in Section 6.11 of the Partnership Credit
Agreement, the provisions of which are hereby incorporated by
reference.
This Partnership Project Note shall be construed and
interpreted in accordance with and governed by the laws of the
State of California without regard to the conflicts of laws rules
thereof.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
CALENERGY OPERATING CORPORATION,
a Delaware corporation
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
VULCAN POWER COMPANY,
a Nevada corporation
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
CONEJO ENERGY COMPANY,
a California corporation
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
NIGUEL ENERGY COMPANY,
a California corporation
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
SAN FELIPE ENERGY COMPANY,
a California corporation
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
BN GEOTHERMAL INC.,
a Delaware corporation
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
DEL RANCH, L.P.,
a California limited partnership
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
ELMORE, L.P.,
a California limited partnership
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
LEATHERS, L.P.,
a California limited partnership
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
VULCAN/BN GEOTHERMAL POWER COMPANY,
a Nevada general partnership
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
CALENERGY MINERALS LLC,
a Delaware limited liability company
By:
Salton Sea Minerals Corp.,
a Delaware corporation, its
manager
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
CE TURBO LLC,
a Delaware limited liability company
By: Magma Power Company,
a Nevada corporation, its manager
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
EXHIBIT 4.31(b)
PARTNERSHIP PROJECT NOTE (SSII)
$93,150,000 October 13, 1998
For value received, the undersigned, CALENERGY
OPERATING CORPORATION, a Delaware corporation, VULCAN POWER
COMPANY, a Nevada corporation, CONEJO ENERGY COMPANY, a
California corporation, NIGUEL ENERGY COMPANY, a California
corporation, SAN FELIPE ENERGY COMPANY, a California corporation,
BN GEOTHERMAL INC., a Delaware corporation, DEL RANCH, L.P., a
California limited partnership, ELMORE, L.P., a California
limited partnership, LEATHERS, L.P., a California limited
partnership, VULCAN/BN GEOTHERMAL POWER COMPANY, a Nevada general
partnership, CALENERGY MINERALS LLC, a Delaware limited liability
company, and CE TURBO LLC, a Delaware limited liability company
(collectively, the "Partnership Guarantors"), by this promissory
note jointly and severally promise to pay to the order of Salton
Sea Funding Corporation, a Delaware corporation ("Funding
Corporation"), at the office of Chase Manhattan Bank and Trust
Company, National Association, a national banking association
organized under the laws of the United States, located at 101
California Street, Number 2725, San Francisco, California 94111,
in lawful currency of the United States of America and in
immediately available funds, the principal amount of $93,150,000,
or if less, the aggregate unpaid and outstanding principal amount
of this Partnership Project Note advanced by Funding Corporation
to the Partnership Guarantors pursuant to that certain Second
Amended and Restated Credit Agreement (Partnership Guarantors)
dated as of the date hereof (the "Partnership Credit Agreement")
by and among the Partnership Guarantors and Funding Corporation,
as the same may be amended from time to time, and all other
amounts owed by the Partnership Guarantors to Funding Corporation
hereunder.
This Partnership Project Note is entered into pursuant
to the Partnership Credit Agreement and is entitled to the
benefits thereof and is subject to all terms, provisions and
conditions thereof. Capitalized terms used and not defined
herein shall have the meanings set forth in Exhibit A to that
certain Trust Indenture, dated as of July 21, 1995 (as the same
may be amended, modified or supplemented, including pursuant to
the First Supplemental Indenture dated as of October 18, 1995,
the Second Supplemental Indenture dated as of June 20, 1996, the
Third Supplemental Indenture dated as of July 29, 1996, and the
Fourth Supplemental Indenture dated as of the date hereof, the
"Indenture"), by and between Funding Corporation and Chase
Manhattan Bank and Trust Company, National Association, a
national banking association organized under the laws of the
United States, successor in interest to Chemical Trust Company of
California, as trustee.
Reference is hereby made to the Partnership Credit
Agreement, the Indenture and the Security Documents for the
provisions, among others, with respect to the custody and
application of the Collateral, the nature and extent of the
security provided thereunder, the rights, duties and obligations
of the Partnership Guarantors and the rights of the holder of
this Partnership Project Note.
The principal amount hereof is payable in accordance
with the Partnership Credit Agreement, and such principal amount
may be prepaid solely in accordance with the Partnership Credit
Agreement.
The Partnership Guarantors further agree to pay, in
lawful currency of the United States of America and in
immediately available funds, interest from the date hereof on the
unpaid and outstanding principal amount hereof until such unpaid
and outstanding principal amount shall become due and payable
(whether at stated maturity, by acceleration or otherwise) at the
rates of interest and at the times set forth in the Partnership
Credit Agreement, and the Partnership Guarantors agree to pay
other fees and costs as stated in the Partnership Credit
Agreement.
Upon the occurrence of any one or more Credit Agreement
Events of Default (as defined in Section 5.1 of the Partnership
Credit Agreement), all amounts then remaining unpaid under this
Partnership Project Note may become or be declared to be
immediately due and payable as provided in the Partnership Credit
Agreement, without notice of default, presentment or demand for
payment, protest or notice of nonpayment or dishonor, or notices
or demands of any kind, all of which are expressly waived by the
Partnership Guarantors.
The obligations hereunder are subject to the
limitations set forth in Section 6.11 of the Partnership Credit
Agreement, the provisions of which are hereby incorporated by
reference.
This Partnership Project Note shall be construed and
interpreted in accordance with and governed by the laws of the
State of California without regard to the conflicts of laws rules
thereof.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
CALENERGY OPERATING CORPORATION,
a Delaware corporation
By:
Name:
Title:
VULCAN POWER COMPANY,
a Nevada corporation
By:
Name:
Title:
CONEJO ENERGY COMPANY,
a California corporation
By:
Name:
Title:
NIGUEL ENERGY COMPANY,
a California corporation
By:
Name:
Title:
SAN FELIPE ENERGY COMPANY,
a California corporation
By:
Name:
Title:
BN GEOTHERMAL INC.,
a Delaware corporation
By:
Name:
Title:
DEL RANCH, L.P.,
a California limited partnership
By:
Name:
Title:
ELMORE, L.P.,
a California limited partnership
By:
Name:
Title:
LEATHERS, L.P.,
a California limited partnership
By:
Name:
Title:
VULCAN/BN GEOTHERMAL POWER COMPANY,
a Nevada general partnership
By:
Name:
Title:
CALENERGY MINERALS LLC,
a Delaware limited liability company
By:
Salton Sea Minerals Corp.,
a Delaware corporation, its manager
By:
Name:
Title:
CE TURBO LLC,
a Delaware limited liability company
By: Magma Power Company,
a Nevada corporation, its manager
By:
Name:
Title:
EXHIBIT 4.31(c)
PARTNERSHIP PROJECT NOTE (SSIII)
$201,728,000 October ____, 1998
For value received, the undersigned, CALENERGY
OPERATING CORPORATION, a Delaware corporation, VULCAN POWER
COMPANY, a Nevada corporation, CONEJO ENERGY COMPANY, a
California corporation, NIGUEL ENERGY COMPANY, a California
corporation, SAN FELIPE ENERGY COMPANY, a California corporation,
BN GEOTHERMAL INC., a Delaware corporation, DEL RANCH, L.P., a
California limited partnership, ELMORE, L.P., a California
limited partnership, LEATHERS, L.P., a California limited
partnership, VULCAN/BN GEOTHERMAL POWER COMPANY, a Nevada general
partnership, CALENERGY MINERALS LLC, a Delaware limited liability
company, and CE TURBO LLC, a Delaware limited liability company
(collectively, the "Partnership Guarantors"), by this promissory
note jointly and severally promise to pay to the order of Salton
Sea Funding Corporation, a Delaware corporation ("Funding
Corporation"), at the office of Chase Manhattan Bank and Trust
Company, National Association, a national banking association
organized under the laws of the United States, located at 101
California Street, Number 2725, San Francisco, California 94111,
in lawful currency of the United States of America and in
immediately available funds, the principal amount of
$201,728,000, or if less, the aggregate unpaid and outstanding
principal amount of this Partnership Project Note advanced by
Funding Corporation to the Partnership Guarantors pursuant to
that certain Second Amended and Restated Credit Agreement
(Partnership Guarantors) dated as of the date hereof (the
"Partnership Credit Agreement") by and among the Partnership
Guarantors and Funding Corporation, as the same may be amended
from time to time, and all other amounts owed by the Partnership
Guarantors to Funding Corporation hereunder.
This Partnership Project Note is entered into pursuant
to the Partnership Credit Agreement and is entitled to the
benefits thereof and is subject to all terms, provisions and
conditions thereof. Capitalized terms used and not defined
herein shall have the meanings set forth in Exhibit A to that
certain Trust Indenture, dated as of July 21, 1995 (as the same
may be amended, modified or supplemented, including pursuant to
the First Supplemental Indenture dated as of October 18, 1995,
the Second Supplemental Indenture dated as of June 20, 1996, the
Third Supplemental Indenture dated as of July 29, 1996, and the
Fourth Supplemental Indenture dated as of the date hereof, the
"Indenture"), by and between Funding Corporation and Chase
Manhattan Bank and Trust Company, National Association, a
national banking association organized under the laws of the
United States, successor in interest to Chemical Trust Company of
California, as trustee.
Reference is hereby made to the Partnership Credit
Agreement, the Indenture and the Security Documents for the
provisions, among others, with respect to the custody and
application of the Collateral, the nature and extent of the
security provided thereunder, the rights, duties and obligations
of the Partnership Guarantors and the rights of the holder of
this Partnership Project Note.
The principal amount hereof is payable in accordance
with the Partnership Credit Agreement, and such principal amount
may be prepaid solely in accordance with the Partnership Credit
Agreement.
The Partnership Guarantors further agree to pay, in
lawful currency of the United States of America and in
immediately available funds, interest from the date hereof on the
unpaid and outstanding principal amount hereof until such unpaid
and outstanding principal amount shall become due and payable
(whether at stated maturity, by acceleration or otherwise) at the
rates of interest and at the times set forth in the Partnership
Credit Agreement, and the Partnership Guarantors agree to pay
other fees and costs as stated in the Partnership Credit
Agreement.
Upon the occurrence of any one or more Credit Agreement
Events of Default (as defined in Section 5.1 of the Partnership
Credit Agreement), all amounts then remaining unpaid under this
Partnership Project Note may become or be declared to be
immediately due and payable as provided in the Partnership Credit
Agreement, without notice of default, presentment or demand for
payment, protest or notice of nonpayment or dishonor, or notices
or demands of any kind, all of which are expressly waived by the
Partnership Guarantors.
The obligations hereunder are subject to the
limitations set forth in Section 6.11 of the Partnership Credit
Agreement, the provisions of which are hereby incorporated by
reference.
This Partnership Project Note shall be construed and
interpreted in accordance with and governed by the laws of the
State of California without regard to the conflicts of laws rules
thereof.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
CALENERGY OPERATING CORPORATION,
a Delaware corporation
By:
Name:
Title:
VULCAN POWER COMPANY,
a Nevada corporation
By:
Name:
Title:
CONEJO ENERGY COMPANY,
a California corporation
By:
Name:
Title:
NIGUEL ENERGY COMPANY,
a California corporation
By:
Name:
Title:
SAN FELIPE ENERGY COMPANY,
a California corporation
By:
Name:
Title:
BN GEOTHERMAL INC.,
a Delaware corporation
By:
Name:
Title:
DEL RANCH, L.P.,
a California limited partnership
By:
Name:
Title:
ELMORE, L.P.,
a California limited partnership
By:
Name:
Title:
LEATHERS, L.P.,
a California limited partnership
By:
Name:
Title:
VULCAN/BN GEOTHERMAL POWER COMPANY,
a Nevada general partnership
By:
Name:
Title:
CALENERGY MINERALS LLC,
a Delaware limited liability company
By:
Salton Sea Minerals Corp.,
a Delaware corporation, its
manager
By:
Name:
Title:
CE TURBO LLC,
a Delaware limited liability company
By: Magma Power Company,
a Nevada corporation, its manager
By:
Name:
Title:
EXHIBIT 4.37(a)
RECORDING REQUESTED BY )
AND WHEN RECORDED RETURN )
TO: )
)
Skadden, Arps, Slate, )
Meagher & Flom )
919 Third Avenue )
New York, New York 10022 )
Attention: Jennifer )
Frederick )
FIRST AMENDMENT TO DEED OF TRUST, ASSIGNMENT OF RENTS,
SECURITY AGREEMENT AND FIXTURE FILING
THIS FIRST AMENDMENT TO DEED OF TRUST, ASSIGNMENT OF
RENTS, SECURITY AGREEMENT AND FIXTURE FILING (this "Amendment")
is made as of October __, 1998 by VULCAN/BN GEOTHERMAL POWER
COMPANY, a Nevada general partnership ("Vulcan"), whose address
is 302 South 36th Street, Suite 400-E, Omaha, Nebraska 68181, and
VULCAN POWER COMPANY, a Nevada corporation ("VPC"), whose address
is 302 South 36th Street , Suite 400-E, Omaha Nebraska 68131, as
trustor (collectively, "Trustor"), to CHICAGO TITLE COMPANY, a
California corporation, whose address is 925 B Street, San Diego,
California 92101, as trustee ("Trustee") and in favor of CHASE
MANHATTAN BANK AND TRUST COMPANY, NATIONAL ASSOCIATION, a
national banking association organized under the laws of the
United States, a California corporation, whose address is 101
California Street, #2725, San Francisco, California 94111, as
beneficiary ("Beneficiary") acting in its capacity (a) as trustee
(as successor in interest to Chemical Trust Company of
California) for and on behalf of Salton Sea Funding Corporation,
a Delaware corporation ("Funding Corporation"), and the Secured
Parties (the "Secured Parties") under that certain Trust
Indenture dated as of July 21, 1995 by and between Funding
Corporation and Beneficiary, as trustee, as the same may be
amended, modified or supplemented, including by that certain
First Supplemental Indenture dated as of October 18, 1995, that
certain Second Supplemental Indenture dated as of June 20, 1996,
that certain Third Supplemental Indenture dated as of July 29,
1996, and that certain Fourth Supplemental Trust Indenture dated
as of even date herewith (as so amended, modified or
supplemented, the "Indenture") and (b) as collateral agent (in
such capacity, the "Collateral Agent") under that certain
Collateral Agency and Intercreditor Agreement dated as of July
21, 1995 as the same may be amended, modified or supplemented,
including by that certain First Amendment to the Collateral
Agency and Intercreditor Agreement dated as of June 20, 1996 and
that certain Second Amendment to the Collateral Agency and
Intercreditor Agreement dated as of even date herewith for the
benefit of the Secured Parties and Funding Corporation (as so
amended, modified or supplemented, the "Intercreditor
Agreement"). Capitalized terms used and not defined herein shall
have the meanings set forth in the Indenture.
RECITALS
WHEREAS, Funding Corporation is a corporation
established for the sole purpose of making loans to the
Guarantors from proceeds of the issuance of notes and bonds
(collectively, the "Securities") in its individual capacity as
principal and as agent acting on behalf of the Guarantors
pursuant to the Indenture; and
WHEREAS, on July 21, 1995 the Funding Corporation
issued and sold Securities in the aggregate principal amount of
$475, 000,000.00 (the "Initial Securities"); and
WHEREAS, in connection with the issuance and sale of
the Initial Securities, Trustor entered into the Partnership
Secured Limited Guarantee (the "Initial Partnership Guarantee")
whereby Trustor guaranteed certain of the obligations of Funding
Corporation under the Initial Securities; and
WHEREAS, on June 20, 1996 the Funding Corporation
issued and sold Securities in the aggregate principal amount of
$135,000,000.00 (the "Supplemental Securities"); and
WHEREAS, in connection with the issuance and sale of
the Supplemental Securities Trustor entered into various
agreements and amendments to the Financing Documents including
(a) that certain Deed of Trust, Assignment of Rents, Security
Agreement, and Fixture Filing in favor of Trustee and for the
benefit of the Secured Parties dated as of June 20, 1996 which
was recorded on June 21, 1996 as instrument no. 96013775 in the
official records of Imperial County, California, (b) that certain
Amended and Restated Partnership Secured Limited Guarantee dated
as of June 20, 1996 (the "Supplemental Partnership Guarantee")
and (c) that certain Agreement Regarding Security Documents in
favor of Collateral Agent and for the benefit of the Secured
Parties dated as of June 20, 1996 (the "First Agreement Regarding
Security Documents"); and
WHEREAS, Funding Corporation has simultaneously with
the execution and delivery of this Amendment issued and sold
Securities in the aggregate principal amount of $285,000,000.00
(the "Additional Securities"); and
WHEREAS, in connection with the issuance and sale of
the Additional Securities, Trustor entered into various
agreements and amendments to the Financing Documents, including
(a) that certain Second Amended and Restated Partnership
Guarantee (the "Additional Partnership Guarantee," together with
the Initial Partnership Guarantee and the Supplemental
partnership Guarantee, the "Partnership Guarantee") and (b) that
certain Second Agreement Regarding Security Documents dated as of
the date hereof, by and among Trustor, Beneficiary and the other
parties named therein (the "Second Agreement Regarding Security
Documents") supplementing the Partnership Guarantee and
acknowledging that the obligations guaranteed by the Partnership
Guarantee include the obligations of Funding Corporation under
the Additional Securities; and
WHEREAS, the parties wish to amend the Deed of Trust to
expressly provide that it secures Trustor's obligations under the
Partnership Guarantee and the other Financing Documents, as so
amended, modified or supplemented, including pursuant to the
Second Agreement Regarding Security Documents.
AGREEMENT
NOW, THEREFORE, in consideration of good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto hereby agree as follows:
1. Financing Documents. The term Financing
Documents, as used in the Deed of Trust, is hereby expressly made
to include (to the extent it does not now so include), without
limitation: (a) the Trust Indenture, dated as of July 21, 1995,
as amended by the First Supplemental Indenture dated as of
October 18, 1995, the Second Supplemental Indenture dated as of
June 20, 1996, the Third Supplemental Indenture dated as of July
29, 1996 and the Fourth Supplemental Indenture dated as of even
date herewith; (b) the $285,000,000 7.475% Senior Secured Series
F Bonds issued as of even date herewith by the Funding
Corporation; (c) the Exchange and Registration Rights Agreement,
dated as of even date herewith, among the Funding Corporation,
Credit Suisse First Boston Corporation and Goldman, Sachs & Co.;
(d) the Amended and Restated Deposit and Disbursement Agreement,
dated as of even date herewith, among the Funding Corporation,
the Guarantors, the Collateral Agent and the Depositary Agent;
(e) the Collateral Agency and Intercreditor Agreement, dated as
of July 21, 1995, as amended by the First Amendment to Collateral
Agency and Intercreditor Agreement dated as of June 20, 1996 and
the Second Amendment to Collateral Agency and Intercreditor
Agreement dated as of even date herewith, among the Funding
Corporation, the Guarantors, the Secured Parties named therein,
the Depositary Agent and the Collateral Agent; (f) the Equity
Commitment Agreement, dated as of even date herewith, among
CalEnergy, the Guarantors and the Collateral Agent; (g) the
Amended and Restated Debt Service Reserve Letter of Credit and
Reimbursement Agreement, dated as of June 20, 1996, as amended by
the Amendment to Notes and to Amended and Restated Debt Service
Reserve Letter of Credit and Reimbursement Agreement dated as of
even date herewith, among the Funding Corporation, the Debt
Service LOC Provider and the other banks named therein; (h) the
Amended and Restated Credit Agreement (Salton Sea Guarantors),
dated as of even date herewith, among the Funding Corporation and
the Salton Sea Guarantors; (i) the Second Amended and Restated
Credit Agreement (Partnership Guarantors), dated as of even date
herewith, among the Funding Corporation and the Partnership
Guarantors; (j) the promissory note in the amount of
$246,483,000, dated as of even date herewith, executed by the
Salton Sea Guarantors in favor of the Funding Corporation; (k)
the promissory note in the amount of $83,272,000, dated as of
even date herewith, executed by the Salton Sea Guarantors in
favor of the Funding Corporation; (l) the promissory note in the
amount of $24,579,000, dated as of even date herewith, executed
by the Partnership Guarantors in favor of the Funding
Corporation; (m) the promissory note in the amount of
$93,150,000, dated as of even date herewith, executed by the
Partnership Guarantors in favor of the Funding Corporation; (n)
the promissory note in the amount of $201,728,000, dated as of
even date herewith, executed by the Partnership Guarantors in
favor of the Funding Corporation; (o) the Amended and Restated
Salton Sea Secured Guarantee, dated as of even date herewith, by
the Salton Sea Guarantors in favor of the Trustee and the
Collateral Agent; and (p) the Second Amended and Restated
Partnership Secured Limited Guarantee, dated as of even date
herewith, by the Partnership Guarantors in favor of the Trustee
and the Collateral Agent.
2. Effect of This Amendment. On and after the date
of this Amendment, each reference in the Deed of Trust to the
Deed of Trust, shall mean the Deed of Trust as amended hereby.
Except as specifically amended above, the Deed of Trust shall
remain in full force and effect and is hereby ratified and
confirmed. The execution, delivery and effectiveness of this
Amendment shall not, except as expressly provided herein, operate
as a waiver of any right, power, or remedy of Beneficiary or any
of the Secured Parties nor constitute a waiver of any provision
of the Deed of Trust.
3. Headings. The headings, titles and captions of
various Sections of this Amendment are for convenience of
reference only and are not to be construed as defining or
limiting, in any way, the scope or intent of the provisions
hereof.
4. Governing Law. THIS AMENDMENT IS GOVERNED BY AND
SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
CALIFORNIA.
5. Counterparts. This Amendment may be signed in any
number of counterparts, each of which shall be an original, with
the same effect as if the signatures thereto and hereto were upon
the same instrument.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be executed, and this Amendment shall be effective,
as of the day and year first above written.
VULCAN POWER COMPANY,
a Nevada corporation
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
VULCAN/BN GEOTHERMAL POWER COMPANY,
a Nevada general partnership
By: Vulcan Power Company,
a Nevada corporation
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
CHASE MANHATTAN BANK AND TRUST COMPANY,
NATIONAL ASSOCIATION,
a national banking association organized
under the laws of the United States, as
Collateral Agent
By: /s/ Rose T. Maravilla
Name: Rose T. Maravilla
Title: Assistant Vice President
EXHIBIT 4.38(a)
RECORDING REQUESTED BY )
AND WHEN RECORDED RETURN )
TO: )
)
Skadden, Arps, Slate, )
Meagher & Flom )
919 Third Avenue )
New York, New York 10022 )
Attention: Jennifer )
Frederick )
FIRST AMENDMENT TO DEED OF TRUST, ASSIGNMENT OF RENTS,
SECURITY AGREEMENT AND FIXTURE FILING
THIS FIRST AMENDMENT TO DEED OF TRUST, ASSIGNMENT OF
RENTS, SECURITY AGREEMENT AND FIXTURE FILING (this "Amendment")
is made as of October __, 1998 by ELMORE L.P., a California
limited partnership ("Elmore") as trustor ("Trustor"), to CHICAGO
TITLE COMPANY, a California corporation, whose address is 925 B
Street, San Diego, California 92101, as trustee ("Trustee") and
in favor of CHASE MANHATTAN BANK AND TRUST COMPANY, NATIONAL
ASSOCIATION, a national banking association organized under the
laws of the United States, whose address is 101 California
Street, #2725, San Francisco, California 94111, as beneficiary
("Beneficiary") acting in its capacity (a) as trustee (as
successor in interest to Chemical Trust Company of California)
for and on behalf of Salton Sea Funding Corporation, a Delaware
corporation ("Funding Corporation"), and the Secured Parties (the
"Secured Parties") under that certain Trust Indenture dated as of
July 21, 1995 by and between Funding Corporation and Beneficiary,
as trustee, as the same may be amended, modified or supplemented,
including by that certain First Supplemental Indenture dated as
of October 18, 1995, that certain Second Supplemental Indenture
dated as of June 20, 1996, that certain Third Supplemental
Indenture dated as of July 29, 1996, and that certain Fourth
Supplemental Trust Indenture dated as of even date herewith (as
so amended, modified or supplemented, the "Indenture") and (b) as
collateral agent (in such capacity, the "Collateral Agent") under
that certain Collateral Agency and Intercreditor Agreement dated
as of July 21, 1995 as the same may be amended, modified or
supplemented, including by that certain First Amendment to the
Collateral Agency and Intercreditor Agreement dated as of June
20, 1996 and that certain Second Amendment to the Collateral
Agency and Intercreditor Agreement dated as of even date herewith
for the benefit of the Secured Parties and Funding Corporation
(as so amended, modified or supplemented, the "Intercreditor
Agreement"). Capitalized terms used and not defined herein shall
have the meanings set forth in the Indenture.
RECITALS
WHEREAS, Funding Corporation is a corporation
established for the sole purpose of making loans to the
Guarantors from proceeds of the issuance of notes and bonds
(collectively, the "Securities") in its individual capacity as
principal and as agent acting on behalf of the Guarantors
pursuant to the Indenture; and
WHEREAS, on July 21, 1995 the Funding Corporation
issued and sold Securities in the aggregate principal amount of
$475, 000,000.00 (the "Initial Securities"); and
WHEREAS, in connection with the issuance and sale of
the Initial Securities, Trustor entered into the Partnership
Secured Limited Guarantee (the "Initial Partnership Guarantee")
whereby Trustor guaranteed certain of the obligations of Funding
Corporation under the Initial Securities; and
WHEREAS, on June 20, 1996 the Funding Corporation
issued and sold Securities in the aggregate principal amount of
$135,000,000.00 (the "Supplemental Securities"); and
WHEREAS, in connection with the issuance and sale of
the Supplemental Securities Trustor entered into various
agreements and amendments to the Financing Documents including
(a) that certain Deed of Trust, Assignment of Rents, Security
Agreement, and Fixture Filing in favor of Trustee and for the
benefit of the Secured Parties dated as of June 20, 1996 which
was recorded on June 21, 1996 as instrument no. 96013777 in the
official records of Imperial County, California, (b) that certain
Amended and Restated Partnership Secured Limited Guarantee dated
as of June 20, 1996 (the "Supplemental Partnership Guarantee")
and (c) that certain Agreement Regarding Security Documents in
favor of Collateral Agent and for the benefit of the Secured
Parties dated as of June 20, 1996 (the "First Agreement Regarding
Security Documents"); and
WHEREAS, Funding Corporation has simultaneously with
the execution and delivery of this Amendment issued and sold
Securities in the aggregate principal amount of $285,000,000.00
(the "Additional Securities"); and
WHEREAS, in connection with the issuance and sale of
the Additional Securities, Trustor entered into various
agreements and amendments to the Financing Documents, including
(a) that certain Second Amended and Restated Partnership
Guarantee (the "Additional Partnership Guarantee," together with
the Initial Partnership Guarantee and the Supplemental
partnership Guarantee, the "Partnership Guarantee") and (b) that
certain Second Agreement Regarding Security Documents dated as of
the date hereof, by and among Trustor, Beneficiary and the other
parties named therein (the "Second Agreement Regarding Security
Documents") supplementing the Partnership Guarantee and
acknowledging that the obligations guaranteed by the Partnership
Guarantee include the obligations of Funding Corporation under
the Additional Securities; and
WHEREAS, the parties wish to amend the Deed of Trust to
expressly provide that it secures Trustor's obligations under the
Partnership Guarantee and the other Financing Documents, as so
amended, modified or supplemented, including pursuant to the
Second Agreement Regarding Security Documents.
AGREEMENT
NOW, THEREFORE, in consideration of good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto hereby agree as follows:
1. Financing Documents. The term Financing
Documents, as used in the Deed of Trust, is hereby expressly made
to include (to the extent it does not now so include), without
limitation: (a) the Trust Indenture, dated as of July 21, 1995,
as amended by the First Supplemental Indenture dated as of
October 18, 1995, the Second Supplemental Indenture dated as of
June 20, 1996, the Third Supplemental Indenture dated as of July
29, 1996 and the Fourth Supplemental Indenture dated as of even
date herewith; (b) the $285,000,000 7.475% Senior Secured Series
F Bonds issued as of even date herewith by the Funding
Corporation; (c) the Exchange and Registration Rights Agreement,
dated as of even date herewith, among the Funding Corporation,
Credit Suisse First Boston Corporation and Goldman, Sachs & Co.;
(d) the Amended and Restated Deposit and Disbursement Agreement,
dated as of even date herewith, among the Funding Corporation,
the Guarantors, the Collateral Agent and the Depositary Agent;
(e) the Collateral Agency and Intercreditor Agreement, dated as
of July 21, 1995, as amended by the First Amendment to Collateral
Agency and Intercreditor Agreement dated as of June 20, 1996 and
the Second Amendment to Collateral Agency and Intercreditor
Agreement dated as of even date herewith, among the Funding
Corporation, the Guarantors, the Secured Parties named therein,
the Depositary Agent and the Collateral Agent; (f) the Equity
Commitment Agreement, dated as of even date herewith, among
CalEnergy, the Guarantors and the Collateral Agent; (g) the
Amended and Restated Debt Service Reserve Letter of Credit and
Reimbursement Agreement, dated as of June 20, 1996, as amended by
the Amendment to Notes and to Amended and Restated Debt Service
Reserve Letter of Credit and Reimbursement Agreement dated as of
even date herewith, among the Funding Corporation, the Debt
Service LOC Provider and the other banks named therein; (h) the
Amended and Restated Credit Agreement (Salton Sea Guarantors),
dated as of even date herewith, among the Funding Corporation and
the Salton Sea Guarantors; (i) the Second Amended and Restated
Credit Agreement (Partnership Guarantors), dated as of even date
herewith, among the Funding Corporation and the Partnership
Guarantors; (j) the promissory note in the amount of
$246,483,000, dated as of even date herewith, executed by the
Salton Sea Guarantors in favor of the Funding Corporation; (k)
the promissory note in the amount of $83,272,000, dated as of
even date herewith, executed by the Salton Sea Guarantors in
favor of the Funding Corporation; (l) the promissory note in the
amount of $24,579,000, dated as of even date herewith, executed
by the Partnership Guarantors in favor of the Funding
Corporation; (m) the promissory note in the amount of
$93,150,000, dated as of even date herewith, executed by the
Partnership Guarantors in favor of the Funding Corporation; (n)
the promissory note in the amount of $201,728,000, dated as of
even date herewith, executed by the Partnership Guarantors in
favor of the Funding Corporation; (o) the Amended and Restated
Salton Sea Secured Guarantee, dated as of even date herewith, by
the Salton Sea Guarantors in favor of the Trustee and the
Collateral Agent; and (p) the Second Amended and Restated
Partnership Secured Limited Guarantee, dated as of even date
herewith, by the Partnership Guarantors in favor of the Trustee
and the Collateral Agent.
2. Effect of This Amendment. On and after the date
of this Amendment, each reference in the Deed of Trust to the
Deed of Trust, shall mean the Deed of Trust as amended hereby.
Except as specifically amended above, the Deed of Trust shall
remain in full force and effect and is hereby ratified and
confirmed. The execution, delivery and effectiveness of this
Amendment shall not, except as expressly provided herein, operate
as a waiver of any right, power, or remedy of Beneficiary or any
of the Secured Parties nor constitute a waiver of any provision
of the Deed of Trust.
3. Headings. The headings, titles and captions of
various Sections of this Amendment are for convenience of
reference only and are not to be construed as defining or
limiting, in any way, the scope or intent of the provisions
hereof.
4. Governing Law. THIS AMENDMENT IS GOVERNED BY AND
SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
CALIFORNIA.
5. Counterparts. This Amendment may be signed in any
number of counterparts, each of which shall be an original, with
the same effect as if the signatures thereto and hereto were upon
the same instrument.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be executed, and this Amendment shall be effective,
as of the day and year first above written.
ELMORE, L.P.,
a California limited partnership
By: CalEnergy Operating Corporation,
a Delaware corporation, its
general partner
By:/s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
CHASE MANHATTAN BANK AND TRUST
COMPANY, NATIONAL ASSOCIATION,
a national banking association
organized under the
laws of the United States, as
Collateral Agent
By: /s/ Rose T. Maravilla
Name: Rose T. Maravilla
Title: Assistant Vice President
EXHIBIT 4.39(a)
RECORDING REQUESTED BY )
AND WHEN RECORDED RETURN )
TO: )
)
Skadden, Arps, Slate, )
Meagher & Flom )
919 Third Avenue )
New York, New York 10022 )
Attention: Jennifer )
Frederick )
FIRST AMENDMENT TO DEED OF TRUST, ASSIGNMENT OF RENTS,
SECURITY AGREEMENT AND FIXTURE FILING
THIS FIRST AMENDMENT TO DEED OF TRUST, ASSIGNMENT OF
RENTS, SECURITY AGREEMENT AND FIXTURE FILING (this "Amendment")
is made as of October __, 1998, by LEATHERS L.P., a California
limited partnership ("Leathers") as trustor ("Trustor"), to
CHICAGO TITLE COMPANY, a California corporation, whose address is
925 B Street, San Diego, California 92101, as trustee ("Trustee")
and in favor of CHASE MANHATTAN BANK AND TRUST COMPANY, NATIONAL
ASSOCIATION, a national banking association organized under the
laws of the United States, whose address is 101 California
Street, #2725, San Francisco, California 94111, as beneficiary
("Beneficiary") acting in its capacity (a) as trustee (as
successor in interest to Chemical Trust Company of California)
for and on behalf of Salton Sea Funding Corporation, a Delaware
corporation ("Funding Corporation"), and the Secured Parties (the
"Secured Parties") under that certain Trust Indenture dated as of
July 21, 1995 by and between Funding Corporation and Beneficiary,
as trustee, as the same may be amended, modified or supplemented,
including by that certain First Supplemental Indenture dated as
of October 18, 1995, that certain Second Supplemental Indenture
dated as of June 20, 1996, that certain Third Supplemental
Indenture dated as of July 29, 1996, and that certain Fourth
Supplemental Trust Indenture dated as of even date herewith (as
so amended, modified or supplemented, the "Indenture") and (b) as
collateral agent (in such capacity, the "Collateral Agent") under
that certain Collateral Agency and Intercreditor Agreement dated
as of July 21, 1995 as the same may be amended, modified or
supplemented, including by that certain First Amendment to the
Collateral Agency and Intercreditor Agreement dated as of June
20, 1996 and that certain Second Amendment to the Collateral
Agency and Intercreditor Agreement dated as of even date herewith
for the benefit of the Secured Parties and Funding Corporation
(as so amended, modified or supplemented, the "Intercreditor
Agreement"). Capitalized terms used and not defined herein shall
have the meanings set forth in the Indenture.
RECITALS
WHEREAS, Funding Corporation is a corporation
established for the sole purpose of making loans to the
Guarantors from proceeds of the issuance of notes and bonds
(collectively, the "Securities") in its individual capacity as
principal and as agent acting on behalf of the Guarantors
pursuant to the Indenture; and
WHEREAS, on July 21, 1995 the Funding Corporation
issued and sold Securities in the aggregate principal amount of
$475, 000,000.00 (the "Initial Securities"); and
WHEREAS, in connection with the issuance and sale of
the Initial Securities, Trustor entered into the Partnership
Secured Limited Guarantee (the "Initial Partnership Guarantee")
whereby Trustor guaranteed certain of the obligations of Funding
Corporation under the Initial Securities; and
WHEREAS, on June 20, 1996 the Funding Corporation
issued and sold Securities in the aggregate principal amount of
$135,000,000.00 (the "Supplemental Securities"); and
WHEREAS, in connection with the issuance and sale of
the Supplemental Securities Trustor entered into various
agreements and amendments to the Financing Documents including
(a) that certain Deed of Trust, Assignment of Rents, Security
Agreements, and Fixture Filing in favor of Trustee and for the
benefit of the Secured Parties dated as of June 20, 1996 which
was recorded on June 21, 1996 as instrument no. 96013778 in the
official records of Imperial County, California, (b) that certain
Amended and Restated Partnership Secured Limited Guarantee dated
as of June 20, 1996 (the "Supplemental Partnership Guarantee")
and (c) that certain Agreement Regarding Security Documents in
favor of Collateral Agent and for the benefit of the Secured
Parties dated as of June 20, 1996 (the "First Agreement Regarding
Security Documents"); and
WHEREAS, Funding Corporation has simultaneously with
the execution and delivery of this Amendment issued and sold
Securities in the aggregate principal amount of $285,000,000.00
(the "Additional Securities"); and
WHEREAS, in connection with the issuance and sale of
the Additional Securities, Trustor entered into various
agreements and amendments to the Financing Documents, including
(a) the Second Amended and Restated Partnership Guarantee (the
"Additional Partnership Guarantee," together with the Initial
Partnership Guarantee and the Supplemental partnership Guarantee,
the "Partnership Guarantee") and (b) that certain Second
Agreement Regarding Security Documents dated as of the date
hereof, by and among Trustor, Beneficiary and the other parties
named therein (the "Agreement Regarding Security Documents")
supplementing the Partnership Guarantee and acknowledging that
the obligations guaranteed by the Partnership Guarantee include
the obligations of Funding Corporation under the Additional
Securities; and
WHEREAS, the parties wish to amend the Deed of Trust to
expressly provide that it secures Trustor's obligations under the
Partnership Guarantee and the other Financing Documents, as so
amended, modified or supplemented, including pursuant to the
Second Agreement Regarding Security Documents.
AGREEMENT
NOW, THEREFORE, in consideration of good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto hereby agree as follows:
1. Financing Documents. The term Financing
Documents, as used in the Deed of Trust, is hereby expressly made
to include (to the extent it does not now so include), without
limitation: (a) the Trust Indenture, dated as of July 21, 1995,
as amended by the First Supplemental Indenture dated as of
October 18, 1995, the Second Supplemental Indenture dated as of
June 20, 1996, the Third Supplemental Indenture dated as of July
29, 1996 and the Fourth Supplemental Indenture dated as of even
date herewith; (b) the $285,000,000 7.475% Senior Secured Series
F Bonds issued as of even date herewith by the Funding
Corporation; (c) the Exchange and Registration Rights Agreement,
dated as of even date herewith, among the Funding Corporation,
Credit Suisse First Boston Corporation and Goldman, Sachs & Co.;
(d) the Amended and Restated Deposit and Disbursement Agreement,
dated as of even date herewith, among the Funding Corporation,
the Guarantors, the Collateral Agent and the Depositary Agent;
(e) the Collateral Agency and Intercreditor Agreement, dated as
of July 21, 1995, as amended by the First Amendment to Collateral
Agency and Intercreditor Agreement dated as of June 20, 1996 and
the Second Amendment to Collateral Agency and Intercreditor
Agreement dated as of even date herewith, among the Funding
Corporation, the Guarantors, the Secured Parties named therein,
the Depositary Agent and the Collateral Agent; (f) the Equity
Commitment Agreement, dated as of even date herewith, among
CalEnergy, the Guarantors and the Collateral Agent; (g) the
Amended and Restated Debt Service Reserve Letter of Credit and
Reimbursement Agreement, dated as of June 20, 1996, as amended by
the Amendment to Notes and to Amended and Restated Debt Service
Reserve Letter of Credit and Reimbursement Agreement dated as of
even date herewith, among the Funding Corporation, the Debt
Service LOC Provider and the other banks named therein; (h) the
Amended and Restated Credit Agreement (Salton Sea Guarantors),
dated as of even date herewith, among the Funding Corporation and
the Salton Sea Guarantors; (i) the Second Amended and Restated
Credit Agreement (Partnership Guarantors), dated as of even date
herewith, among the Funding Corporation and the Partnership
Guarantors; (j) the promissory note in the amount of
$246,483,000, dated as of even date herewith, executed by the
Salton Sea Guarantors in favor of the Funding Corporation; (k)
the promissory note in the amount of $83,272,000, dated as of
even date herewith, executed by the Salton Sea Guarantors in
favor of the Funding Corporation; (l) the promissory note in the
amount of $24,579,000, dated as of even date herewith, executed
by the Partnership Guarantors in favor of the Funding
Corporation; (m) the promissory note in the amount of
$93,150,000, dated as of even date herewith, executed by the
Partnership Guarantors in favor of the Funding Corporation; (n)
the promissory note in the amount of $201,728,000, dated as of
even date herewith, executed by the Partnership Guarantors in
favor of the Funding Corporation; (o) the Amended and Restated
Salton Sea Secured Guarantee, dated as of even date herewith, by
the Salton Sea Guarantors in favor of the Trustee and the
Collateral Agent; and (p) the Second Amended and Restated
Partnership Secured Limited Guarantee, dated as of even date
herewith, by the Partnership Guarantors in favor of the Trustee
and the Collateral Agent.
2. Effect of This Amendment. On and after the date
of this Amendment, each reference in the Deed of Trust to the
Deed of Trust, shall mean the Deed of Trust as amended hereby.
Except as specifically amended above, the Deed of Trust shall
remain in full force and effect and is hereby ratified and
confirmed. The execution, delivery and effectiveness of this
Amendment shall not, except as expressly provided herein, operate
as a waiver of any right, power, or remedy of Beneficiary or any
of the Secured Parties nor constitute a waiver of any provision
of the Deed of Trust.
3. Headings. The headings, titles and captions of
various Sections of this Amendment are for convenience of
reference only and are not to be construed as defining or
limiting, in any way, the scope or intent of the provisions
hereof.
4. Governing Law. THIS AMENDMENT IS GOVERNED BY AND
SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
CALIFORNIA.
5. Counterparts. This Amendment may be signed in any
number of counterparts, each of which shall be an original, with
the same effect as if the signatures thereto and hereto were upon
the same instrument.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be executed, and this Amendment shall be effective,
as of the day and year first above written.
LEATHERS, L.P.
a California limited partnership
By: CalEnergy Operating Corporation
a Delaware corporation, its
general partner
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
CHASE MANHATTAN BANK AND TRUST
COMPANY, NATIONAL ASSOCIATION,
a national banking association
organized under the laws of the
United States, as Collateral Agent
By:/s/ Rose T. Maravilla
Name: Rose T. Maravilla
Title: Assistant Vice President
EXHIBIT 4.40(a)
RECORDING REQUESTED BY )
AND WHEN RECORDED RETURN )
TO: )
)
Skadden, Arps, Slate, )
Meagher & Flom )
919 Third Avenue )
New York, New York 10022 )
Attention: Jennifer )
Frederick )
FIRST AMENDMENT TO DEED OF TRUST, ASSIGNMENT OF RENTS,
SECURITY AGREEMENT AND FIXTURE FILING
THIS FIRST AMENDMENT TO DEED OF TRUST, ASSIGNMENT OF
RENTS, SECURITY AGREEMENT AND FIXTURE FILING (this "Amendment")
is made as of October __, 1998 by DEL RANCH L.P., a California
limited partnership ("Del Ranch") as trustor ("Trustor"), to
CHICAGO TITLE COMPANY, a California corporation, whose address is
925 B Street, San Diego, California 92101, as trustee ("Trustee")
and in favor of CHASE MANHATTAN BANK AND TRUST COMPANY, NATIONAL
ASSOCIATION, a national banking association organized under the
laws of the United States, whose address is 101 California
Street, #2725, San Francisco, California 94111, as beneficiary
("Beneficiary") acting in its capacity (a) as trustee (as
successor in interest to Chemical Trust Company of California)
for and on behalf of Salton Sea Funding Corporation, a Delaware
corporation ("Funding Corporation"), and the Secured Parties (the
"Secured Parties") under that certain Trust Indenture dated as of
July 21, 1995 by and between Funding Corporation and Beneficiary,
as trustee, as the same may be amended, modified or supplemented,
including by that certain First Supplemental Indenture dated as
of October 18, 1995, that certain Second Supplemental Indenture
dated as of June 20, 1996, that certain Third Supplemental
Indenture dated as of July 29, 1996, and that certain Fourth
Supplemental Trust Indenture dated as of even date herewith (as
so amended, modified or supplemented, the "Indenture") and (b) as
collateral agent (in such capacity, the "Collateral Agent") under
that certain Collateral Agency and Intercreditor Agreement dated
as of July 21, 1995 as the same may be amended, modified or
supplemented, including by that certain First Amendment to the
Collateral Agency and Intercreditor Agreement dated as of June
20, 1996 and that certain Second Amendment to the Collateral
Agency and Intercreditor Agreement dated as of even date herewith
for the benefit of the Secured Parties and Funding Corporation
(as so amended, modified or supplemented, the "Intercreditor
Agreement"). Capitalized terms used and not defined herein shall
have the meanings set forth in the Indenture.
RECITALS
WHEREAS, Funding Corporation is a corporation
established for the sole purpose of making loans to the
Guarantors from proceeds of the issuance of notes and bonds
(collectively, the "Securities") in its individual capacity as
principal and as agent acting on behalf of the Guarantors
pursuant to the Indenture; and
WHEREAS, on July 21, 1995 the Funding Corporation
issued and sold Securities in the aggregate principal amount of
$475, 000,000.00 (the "Initial Securities"); and
WHEREAS, in connection with the issuance and sale of
the Initial Securities, Trustor entered into the Partnership
Secured Limited Guarantee (the "Initial Partnership Guarantee")
whereby Trustor guaranteed certain of the obligations of Funding
Corporation under the Initial Securities; and
WHEREAS, on June 20, 1996 the Funding Corporation
issued and sold Securities in the aggregate principal amount of
$135,000,000.00 (the "Supplemental Securities"); and
WHEREAS, in connection with the issuance and sale of
the Supplemental Securities Trustor entered into various
agreements and amendments to the Financing Documents including
(a) that certain Deed of Trust, Assignment of Rents, Security
Agreement, and Fixture Filing in favor of Trustee and for the
benefit of the Secured Parties dated as of June 20, 1996 which
was recorded on June 21, 1996 as instrument no. 96013776 in the
official records of Imperial County, California, (b) that certain
Amended and Restated Partnership Secured Limited Guarantee dated
as of June 20, 1996 (the "Supplemental Partnership Guarantee")
and (c) that certain Agreement Regarding Security Documents in
favor of Collateral Agent and for the benefit of the Secured
Parties dated as of June 20, 1996 (the "First Agreement Regarding
Security Documents"); and
WHEREAS, Funding Corporation has simultaneously with
the execution and delivery of this Amendment issued and sold
Securities in the aggregate principal amount of $285,000,000.00
(the "Additional Securities"); and
WHEREAS, in connection with the issuance and sale of
the Additional Securities, Trustor entered into various
agreements and amendments to the Financing Documents, including
(a) that certain Second Amended and Restated Partnership
Guarantee (the "Additional Partnership Guarantee," together with
the Initial Partnership Guarantee and the Supplemental
partnership Guarantee, the "Partnership Guarantee") and (b) that
certain Second Agreement Regarding Security Documents dated as of
the date hereof, by and among Trustor, Beneficiary and the other
parties named therein (the "Second Agreement Regarding Security
Documents") supplementing the Partnership Guarantee and
acknowledging that the obligations guaranteed by the Partnership
Guarantee include the obligations of Funding Corporation under
the Additional Securities; and
WHEREAS, the parties wish to amend the Deed of Trust to
expressly provide that it secures Trustor's obligations under the
Partnership Guarantee and the other Financing Documents, as so
amended, modified or supplemented, including pursuant to the
Second Agreement Regarding Security Documents.
AGREEMENT
NOW, THEREFORE, in consideration of good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto hereby agree as follows:
1. Financing Documents. The term Financing
Documents, as used in the Deed of Trust, is hereby expressly made
to include (to the extent it does not now so include), without
limitation: (a) the Trust Indenture, dated as of July 21, 1995,
as amended by the First Supplemental Indenture dated as of
October 18, 1995, the Second Supplemental Indenture dated as of
June 20, 1996, the Third Supplemental Indenture dated as of July
29, 1996 and the Fourth Supplemental Indenture dated as of even
date herewith; (b) the $285,000,000 7.475% Senior Secured Series
F Bonds issued as of even date herewith by the Funding
Corporation; (c) the Exchange and Registration Rights Agreement,
dated as of even date herewith, among the Funding Corporation,
Credit Suisse First Boston Corporation and Goldman, Sachs & Co.;
(d) the Amended and Restated Deposit and Disbursement Agreement,
dated as of even date herewith, among the Funding Corporation,
the Guarantors, the Collateral Agent and the Depositary Agent;
(e) the Collateral Agency and Intercreditor Agreement, dated as
of July 21, 1995, as amended by the First Amendment to Collateral
Agency and Intercreditor Agreement dated as of June 20, 1996 and
the Second Amendment to Collateral Agency and Intercreditor
Agreement dated as of even date herewith, among the Funding
Corporation, the Guarantors, the Secured Parties named therein,
the Depositary Agent and the Collateral Agent; (f) the Equity
Commitment Agreement, dated as of even date herewith, among
CalEnergy, the Guarantors and the Collateral Agent; (g) the
Amended and Restated Debt Service Reserve Letter of Credit and
Reimbursement Agreement, dated as of June 20, 1996, as amended by
the Amendment to Notes and to Amended and Restated Debt Service
Reserve Letter of Credit and Reimbursement Agreement dated as of
even date herewith, among the Funding Corporation, the Debt
Service LOC Provider and the other banks named therein; (h) the
Amended and Restated Credit Agreement (Salton Sea Guarantors),
dated as of even date herewith, among the Funding Corporation and
the Salton Sea Guarantors; (i) the Second Amended and Restated
Credit Agreement (Partnership Guarantors), dated as of even date
herewith, among the Funding Corporation and the Partnership
Guarantors; (j) the promissory note in the amount of
$246,483,000, dated as of even date herewith, executed by the
Salton Sea Guarantors in favor of the Funding Corporation; (k)
the promissory note in the amount of $83,272,000, dated as of
even date herewith, executed by the Salton Sea Guarantors in
favor of the Funding Corporation; (l) the promissory note in the
amount of $24,579,000, dated as of even date herewith, executed
by the Partnership Guarantors in favor of the Funding
Corporation; (m) the promissory note in the amount of
$93,150,000, dated as of even date herewith, executed by the
Partnership Guarantors in favor of the Funding Corporation; (n)
the promissory note in the amount of $201,728,000, dated as of
even date herewith, executed by the Partnership Guarantors in
favor of the Funding Corporation; (o) the Amended and Restated
Salton Sea Secured Guarantee, dated as of even date herewith, by
the Salton Sea Guarantors in favor of the Trustee and the
Collateral Agent; and (p) the Second Amended and Restated
Partnership Secured Limited Guarantee, dated as of even date
herewith, by the Partnership Guarantors in favor of the Trustee
and the Collateral Agent.
2. Effect of This Amendment. On and after the date
of this Amendment, each reference in the Deed of Trust to the
Deed of Trust, shall mean the Deed of Trust as amended hereby.
Except as specifically amended above, the Deed of Trust shall
remain in full force and effect and is hereby ratified and
confirmed. The execution, delivery and effectiveness of this
Amendment shall not, except as expressly provided herein, operate
as a waiver of any right, power, or remedy of Beneficiary or any
of the Secured Parties nor constitute a waiver of any provision
of the Deed of Trust.
3. Headings. The headings, titles and captions of
various Sections of this Amendment are for convenience of
reference only and are not to be construed as defining or
limiting, in any way, the scope or intent of the provisions
hereof.
4. Governing Law. THIS AMENDMENT IS GOVERNED BY AND
SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
CALIFORNIA.
5. Counterparts. This Amendment may be signed in any
number of counterparts, each of which shall be an original, with
the same effect as if the signatures thereto and hereto were upon
the same instrument.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be executed, and this Amendment shall be effective,
as of the day and year first above written.
DEL RANCH, L.P.,
a California limited partnership
By: CalEnergy Operating Corporation,
a Delaware corporation, its
general partner
By: /s/ Craig M. Hammett
Name: Craig M. Hammett
Title: Senior Vice President
CHASE MANHATTAN BANK AND TRUST
COMPANY, NATIONAL ASSOCIATION,
a national banking association
organized under the
laws of the United States, as
Collateral Agent
By: /s/ Rose T. Maravilla
Name: Rose T. Maravilla
Title: Assistant Vice President
EXHIBIT 10.1(c)
RECORDING REQUESTED BY )
AND WHEN RECORDED RETURN )
TO: )
)
Skadden, Arps, Slate, )
Meagher & Flom )
919 Third Avenue )
New York, New York 10022 )
Attention: Jennifer )
Frederick )
SECOND AMENDMENT TO DEED OF TRUST, ASSIGNMENT OF RENTS,
SECURITY AGREEMENT AND FIXTURE FILING
THIS SECOND AMENDMENT TO DEED OF TRUST, ASSIGNMENT OF
RENTS, SECURITY AGREEMENT AND FIXTURE FILING (this "Amendment")
is made as of October __, 1998 by SALTON SEA POWER GENERATION
L.P., a California limited partnership ("SSPG"), whose address is
302 South 36th Street, Suite 400-E, Omaha, Nebraska 68131, SALTON
SEA BRINE PROCESSING L.P., a California limited partnership
("SSBP"), whose address is 302 South 36th Street, Suite 400-D,
Omaha, Nebraska 68131 and FISH LAKE POWER COMPANY, a Delaware
corporation ("Fish Lake"), whose address is 302 South 36th
Street, Suite 400-B, Omaha, Nebraska 68131, jointly and severally
as trustor (collectively "Trustor"), to CHICAGO TITLE COMPANY, a
California corporation, whose address is 925 B Street, San Diego,
California 92101, as trustee ("Trustee") and in favor of CHASE
MANHATTAN BANK AND TRUST COMPANY, NATIONAL ASSOCIATION, a
national banking association organized under the laws of the
United States, whose address is 101 California Street, #2725, San
Francisco, California 94111, as beneficiary ("Beneficiary")
acting in its capacity (a) as trustee (as successor in interest
to Chemical Trust Company of California) for and on behalf of
Salton Sea Funding Corporation, a Delaware corporation ("Funding
Corporation"), and the Secured Parties (the "Secured Parties")
under that certain Trust Indenture dated as of July 21, 1995 by
and between Funding Corporation and Beneficiary, as trustee, as
the same may be amended, modified or supplemented, including by
that certain First Supplemental Indenture dated as of October 18,
1995, that certain Second Supplemental Indenture dated as of June
20, 1996, that certain Third Supplemental Indenture dated as of
July 29, 1996, and that certain Fourth Supplemental Trust
Indenture dated as of even date herewith (as so amended, modified
or supplemented, the "Indenture") and (b) as collateral agent (in
such capacity, the "Collateral Agent") under that certain
Collateral Agency and Intercreditor Agreement dated as of July
21, 1995 as the same may be amended, modified or supplemented,
including by that certain First Amendment to the Collateral
Agency and Intercreditor Agreement dated as of June 20, 1996 and
that certain Second Amendment to the Collateral Agency and
Intercreditor Agreement dated as of even date herewith for the
benefit of the Secured Parties and Funding Corporation (as so
amended, modified or supplemented, the "Intercreditor
Agreement"). Capitalized terms used and not defined herein shall
have the meanings set forth in the Indenture.
RECITALS
WHEREAS, Funding Corporation is a corporation
established for the sole purpose of making loans to the
Guarantors from proceeds of the issuance of notes and bonds
(collectively, the "Securities") in its individual capacity as
principal and as agent acting on behalf of the Guarantors
pursuant to the Indenture; and
WHEREAS, on July 21, 1995 the Funding Corporation
issued and sold Securities in the aggregate principal amount of
$475, 000,000.00 (the "Initial Securities"); and
WHEREAS, in connection with the issuance and sale of
the Initial Securities, Trustor entered into the Salton Sea
Secured Guarantee dated as of July 21, 1995 in favor of
Beneficiary (the "Initial Salton Sea Guarantee") whereby Trustor
guaranteed certain of the obligations of Funding Corporation
under the Initial Securities; and
WHEREAS, in order to secure its obligations under the
Salton Sea Secured Guarantee and the other Financing Documents,
Trustor has, among other things, entered into that certain Deed
of Trust, Assignment of Rents, Security Agreement and Fixture
Filing in favor of Trustee and for the benefit of Beneficiary
(the "Initial Deed of Trust") dated as of July 21, 1995 which was
recorded on July 21, 1995, as instrument no. 95015970, in the
official records of Imperial County, California; and
WHEREAS, on June 20, 1996 the Funding Corporation
issued and sold Securities in the aggregate principal amount of
$135,000,000.00 (the "Supplemental Securities"); and
WHEREAS, in connection with the issuance and sale of
the Supplemental Securities Trustor entered into various
agreements and amendments to the Financing Documents including
(a) that certain First Amendment to Deed of Trust, Assignment of
Rents, Security Agreements, and Fixture Filing in favor of
Trustee and for the benefit of the Secured Parties (the "First
Amendment" and together with the "Initial Deed of Trust", the
"Deed of Trust") dated as of June 20, 1996 which was recorded on
June 21, 1996 as instrument no. 96013784 in the official records
of Imperial County, California; and (b) that certain Agreement
Regarding Security Documents in favor of Collateral Agent and for
the benefit of the Secured Parties dated as of June 20, 1996 (the
"First Agreement Regarding Security Documents"); and
WHEREAS, Funding Corporation has simultaneously with
the execution and delivery of this Amendment issued and sold
Securities in the aggregate principal amount of $285,000,000.00
(the "Additional Securities"); and
WHEREAS, in connection with the issuance and sale of
the Additional Securities, Trustor entered into various
agreements and amendments to the Financing Documents, including
(a) the Amended and Restated Salton Sea Guarantee (the "Second
Salton Sea Guarantee," together with the Initial Salton Sea
Guarantee, the "Salton Sea Guarantee") dated as of the date
hereof and (b) that certain Second Agreement Regarding Security
Documents dated as of the date hereof, by and among Trustor,
Beneficiary and the other parties named therein (the "Agreement
Regarding Security Documents") supplementing the Salton Sea
Guarantee and acknowledging that the obligations guaranteed by
the Salton Sea Guarantee include the obligations of Funding
Corporation under the Additional Securities; and
WHEREAS, the parties wish to amend the Deed of Trust to
expressly provide that it secures Trustor's obligations under the
Salton Sea Guarantee and the other Financing Documents, as so
amended, modified or supplemented, including pursuant to the
Second Agreement Regarding Security Documents.
AGREEMENT
NOW, THEREFORE, in consideration of good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto hereby agree as follows:
1. Financing Documents. The term Financing
Documents, as used in the Deed of Trust, is hereby expressly made
to include (to the extent it does not now so include), without
limitation: (a) the Trust Indenture, dated as of July 21, 1995,
as amended by the First Supplemental Indenture dated as of
October 18, 1995, the Second Supplemental Indenture dated as of
June 20, 1996, the Third Supplemental Indenture dated as of July
29, 1996 and the Fourth Supplemental Indenture dated as of even
date herewith; (b) the $285,000,000 7.475% Senior Secured Series
F Bonds issued as of even date herewith by the Funding
Corporation; (c) the Exchange and Registration Rights Agreement,
dated as of even date herewith, among the Funding Corporation,
Credit Suisse First Boston Corporation and Goldman, Sachs & Co.;
(d) the Amended and Restated Deposit and Disbursement Agreement,
dated as of even date herewith, among the Funding Corporation,
the Guarantors, the Collateral Agent and the Depositary Agent;
(e) the Collateral Agency and Intercreditor Agreement, dated as
of July 21, 1995, as amended by the First Amendment to Collateral
Agency and Intercreditor Agreement dated as of June 20, 1996 and
the Second Amendment to Collateral Agency and Intercreditor
Agreement dated as of even date herewith, among the Funding
Corporation, the Guarantors, the Secured Parties named therein,
the Depositary Agent and the Collateral Agent; (f) the Equity
Commitment Agreement, dated as of even date herewith, among
CalEnergy, the Guarantors and the Collateral Agent; (g) the
Amended and Restated Debt Service Reserve Letter of Credit and
Reimbursement Agreement, dated as of June 20, 1996, as amended by
the Amendment to Notes and to Amended and Restated Debt Service
Reserve Letter of Credit and Reimbursement Agreement dated as of
even date herewith, among the Funding Corporation, the Debt
Service LOC Provider and the other banks named therein; (h) the
Amended and Restated Credit Agreement (Salton Sea Guarantors),
dated as of even date herewith, among the Funding Corporation and
the Salton Sea Guarantors; (i) the Second Amended and Restated
Credit Agreement (Partnership Guarantors), dated as of even date
herewith, among the Funding Corporation and the Partnership
Guarantors; (j) the promissory note in the amount of
$246,483,000, dated as of even date herewith, executed by the
Salton Sea Guarantors in favor of the Funding Corporation; (k)
the promissory note in the amount of $83,272,000, dated as of
even date herewith, executed by the Salton Sea Guarantors in
favor of the Funding Corporation; (l) the promissory note in the
amount of $24,579,000, dated as of even date herewith, executed
by the Partnership Guarantors in favor of the Funding
Corporation; (m) the promissory note in the amount of
$93,150,000, dated as of even date herewith, executed by the
Partnership Guarantors in favor of the Funding Corporation; (n)
the promissory note in the amount of $201,728,000, dated as of
even date herewith, executed by the Partnership Guarantors in
favor of the Funding Corporation; (o) the Amended and Restated
Salton Sea Secured Guarantee, dated as of even date herewith, by
the Salton Sea Guarantors in favor of the Trustee and the
Collateral Agent; and (p) the Second Amended and Restated
Partnership Secured Limited Guarantee, dated as of even date
herewith, by the Partnership Guarantors in favor of the Trustee
and the Collateral Agent.
2. Effect of This Amendment. On and after the date
of this Amendment, each reference in the Deed of Trust to the
Deed of Trust, shall mean the Deed of Trust as amended hereby.
Except as specifically amended above, the Deed of Trust shall
remain in full force and effect and is hereby ratified and
confirmed. The execution, delivery and effectiveness of this
Amendment shall not, except as expressly provided herein, operate
as a waiver of any right, power, or remedy of Beneficiary or any
of the Secured Parties nor constitute a waiver of any provision
of the Deed of Trust.
3. Headings. The headings, titles and captions of
various Sections of this Amendment are for convenience of
reference only and are not to be construed as defining or
limiting, in any way, the scope or intent of the provisions
hereof.
4. Governing Law. THIS AMENDMENT IS GOVERNED BY AND
SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
CALIFORNIA.
5. Counterparts. This Amendment may be signed in any
number of counterparts, each of which shall be an original, with
the same effect as if the signatures thereto and hereto were upon
the same instrument.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the parties hereto have
caused this Amendment to be executed, and this Amendment
shall be effective, as of the day and year first above
written.
SALTON SEA POWER GENERATION L.P.,
a California limited partnership
By: Salton Sea Power Company,
a Nevada corporation,
its general partner
By: /s/ Steven A. McArthur
Name: Steven A. McArthur
Title: Executive Vice President
SALTON SEA BRINE PROCESSING L.P.,
a California limited partnership
By: Salton Sea Power Company,
a Nevada corporation,
its general partner
By: /s/ Steven A. McArthur
Name: Steven A. McArthur
Title: Executive Vice President
FISH LAKE POWER COMPANY,
a Delaware corporation
By: /s/ Steven A. McArthur
Name: Steven A. McArthur
Title: Executive Vice President
CHASE MANHATTAN BANK AND
TRUST COMPANY, NATIONAL
ASSOCIATION,
a national banking
association organized under
the laws of the United
States, as Collateral Agent
By: /s/ Rose T. Maravilla
Name:Rose T. Maravilla
Title: Assistant Vice President
