Exhibit 3.8
AMENDMENT AGREEMENT
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(CPD)
This AMENDMENT AGREEMENT ("Agreement") is entered into and is effective as
of this 28th day of May, 1999, by and among COSO POWER DEVELOPERS, a California
general partnership ("CPD"), CAITHNESS ACQUISITION COMPANY, LLC, a Delaware
limited liability company ("CAC"), NEW CTC COMPANY, LLC ("New CTC"), a Delaware
limited liability company, CAITHNESS NAVY II GROUP, LLC, a Delaware limited
liability company ("Navy II Group") and COSO OPERATING COMPANY LLC ("COC"), a
Delaware limited liability company.
RECITALS
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WHEREAS, CPD is a California general partnership that is the owner of a
geothermal power facility located in Inyo County, California, commonly known as
the Navy II Project (the "Project");
WHEREAS, CPD was, prior to February 25, 1999, co-owned by Navy II Group,
L.P. (predecessor to Navy II Group), an affiliate of Caithness Energy, L.L.C., a
Delaware limited liability company ("Caithness Energy") and Coso Technology
Corporation ("CTC"), a former affiliate of CalEnergy Company, Inc., a Delaware
corporation ("CalEnergy"). CPD was constituted under the General Partnership
Agreement of CPD, as amended (the "Partnership Agreement") and was managed by
COC, previously a wholly owned subsidiary of CalEnergy, as assignee of
CalEnergy, pursuant to two Operations and Maintenance Agreements (the "O&M
Agreements");
WHEREAS, CTC previously served as the Managing General Partner and COC
previously served as the Operator of the Project, in consideration for which CTC
and COC received a management fee (the "Management Fee") and operator fees (the
"Operator Fees") in accordance with the Partnership Agreement and O&M
Agreements. CTC also received a fee in consideration for its participation as a
member of the Management Committee of CPD (the "Committee Fee");
WHEREAS, on February 25, 1999, CTC was merged with and into New CTC, a
wholly owned subsidiary of CAC itself a wholly owned subsidiary of Caithness
Energy. In addition, CAC acquired COC;
WHEREAS, New CTC, as successor to CTC, now serves as the Managing General
Partner of CPD;
WHEREAS, COC, now a wholly owned subsidiary of CAC, in conjunction with FPL
Energy Operating Services, Inc., now serves as the Operator of the Project;
WHEREAS, CAC, as sole parent of New CTC and COC, has agreed to a large
reduction in the amount of the Management Fee and has negotiated a reduction in
Operator Fees from those fees previously in effect. Furthermore, New CTC has
agreed to eliminate the Committee Fee. These reductions in fees are in the best
interests of CPD and will have the effect of bringing the amount the Management
Fee and Operating Fees more in line with the actual cost of running the Project.
WHEREAS, CAC, as parent of New CTC and COC, has also agreed that the right
to receive the Management Fee and Operator Fees payable to COC shall be
subordinate to debt service payments. This will reverse the prior arrangement,
pursuant to which debt service payments were subordinate to CTC and COC's rights
to receive the Management Fee and Operator Fees. This will constitute a
substantial benefit to CPD as it will increase the amount of cash available for
debt service;
WHEREAS, in consideration for CAC's agreement to cause its subsidiaries to
amend the Partnership Agreement and O&M Agreements to reflect the restructuring
of these fees and to negotiate lower operating fees with FPL Operating Services,
Inc., Navy II Group has agreed to pay to CAC a one-time fee that will represent
its share of the net present value of the savings that will result from the
restructuring of the fee payments over the next ten years.
NOW, THEREFORE, in consideration of the foregoing Recitals, which are by
this reference incorporated herein, and for other good and valuable
consideration, the receipt of which is hereby acknowledged, the parties hereto
agree as follows:
AGREEMENT
1. Reduction and Subordination of Fees. CAC, as parent of New CTC and
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COC, hereby agrees to cause New CTC and COC to execute and deliver an amended
Partnership Agreement and O&M Agreements reflecting a reduction in the amount of
the Management Fee payable to Navy II Group and Operator Fees payable to COC and
elimination of the Committee Fee payable to New CTC.
2. Subordination of Fees. CAC also agree that it will cause COC to
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execute an agreement pursuant to which its right to receive Management Fees
shall be subordinate to debt service payments on account of the new senior
secured debt.
3. Fee Buy Down Amount. The net present value of aggregate amount of the
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savings over the next ten years to CPD resulting from CAC's agreement to cause
New CTC and COC to execute and deliver an amended Partnership Agreement and O&M
Agreement is approximately $17,214,000 (the "Fee Buy Down Amount").
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4. Payment by Caithness Navy II Group, LLC. Upon execution of the amended
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Partnership Agreement and new O&M Agreement described in Section 1 and solely
from funds received by Navy II Group from distributions in connection with the
refinancing of the senior debt of CPD, Caithness Navy II Group, LLC shall pay to
CAC, as designee of New CTC and COC, in consideration for CAC's acceptance of
the provisions herein, the sum of $8,607,000, which represents Navy II Group's
share of the Fee Buy Down Amount equal to Navy II Group's proportionate
ownership of CPD.
5. Further Assurances. The parties hereto agree that, at any times and
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from time to time, upon the written request of the other, such party will
promptly and duly execute and deliver any and all such further instruments and
documents and take such further action as the other party may reasonably request
in order to obtain the full benefit of the this Agreement.
6. Severability. Any provision of this Agreement which is prohibited,
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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.
7. Successors and Assigns. Whenever in this Agreement any of the parties
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hereto is named or referred to, successors and assigns of such party shall be
deemed to be included and all covenants, promises and agreements in this
Agreement by and on behalf of the respective parties hereto shall be binding
upon and inure to the benefit of the respective successors and permitted assigns
of such parties, whether so expressed or not.
8. Governing Law. This Agreement shall be governed by, interpreted
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under, and construed and enforced in accordance with the laws of the State of
California.
9. Amendments and Waivers. This Agreement may be amended only by a
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writing signed by the parties hereto. No amendment or waiver of any provision
of this Agreement nor consent by any party or any departure by any other party
herefrom shall in any event be effective unless the same shall be in writing and
signed by the party to be charged thereby. 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 any party hereto to exercise, and no delay in
exercising, any right hereunder shall operate as a waiver thereof (except as
expressly provided herein) nor shall any single or partial exercise or any right
hereunder preclude any other or further exercise thereof or the exercise of any
other right.
10. Headings. The section headings in this Agreement are included herein
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for convenience of reference only and shall not constitute a part of this
Agreement for any other purpose.
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11. Counterparts. This Agreement may be executed in any number of
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counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the
Effective Date.
CAITHNESS ACQUISITION COMPANY, LLC,
a Delaware limited liability company
By: /s/ James D. Bishop, Jr.
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James D. Bishop, Jr.
Vice Chairman
NEW CTC COMPANY, LLC,
a Delaware limited liability company
By: /s/ James D. Bishop, Jr.
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James D. Bishop, Jr.
Vice Chairman
CAITHNESS NAVY II GROUP, LLC,
a Delaware limited liability company
By: Caithness Geothermal 1980 Ltd., L.P.,
a Delaware limited partnership
its Member
By: Caithness Power, L.L.C.,
a Delaware limited liability company,
its General Partner
By: /s/ James D. Bishop, Jr.
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James D. Bishop, Jr.
Vice Chairman
By: Mt. Whitney Geothermal-II Limited Partnership,
a Delaware limited partnership,
its Member
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By: Caithness Power, L.L.C.,
a Delaware limited liability company,
its General Partner
By: /s/ James D. Bishop, Jr.
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James D. Bishop, Jr.
Vice Chairman
By: Caithness Power, L.L.C.,
a Delaware limited liability company,
its Managing Member
By: /s/ James D. Bishop, Jr.
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James D. Bishop, Jr.
Vice Chairman
By: Dominion Energy, Inc.,
a Virginia corporation,
its Limited Member
By: /s/ James W. Braswell
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Name: James W. Braswell
Title: Vice President
COSO OPERATING COMPANY LLC,
a Delaware limited liability company
By: /s/ James D. Bishop, Jr.
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James D. Bishop, Jr.
Vice Chairman
COSO POWER DEVELOPERS,
a California general partnership
By: New CTC Company, LLC,
a Delaware limited liability company,
its Managing General Partner
By: /s/ James D. Bishop, Jr.
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James D. Bishop, Jr.
Vice Chairman
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By: Caithness Navy II Group, LLC,
a Delaware limited liability company
its General Partner
By: Caithness Geothermal 1980 Ltd., L.P.,
a Delaware limited partnership
its Member
By: Caithness Power, L.L.C.,
a Delaware limited liability company,
its General Partner
By: /s/ James D. Bishop, Jr.
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James D. Bishop, Jr.
Vice Chairman
By: Mt. Whitney Geothermal-II Limited Partnership,
a Delaware limited partnership,
its Member
By: Caithness Power, L.L.C.,
a Delaware limited liability company,
its General Partner
By: /s/ James D. Bishop, Jr.
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James D. Bishop, Jr.
Vice Chairman
By: Caithness Power, L.L.C.,
a Delaware limited liability company,
its Managing Member
By: /s/ James D. Bishop, Jr.
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James D. Bishop, Jr.
Vice Chairman
By: Dominion Energy, Inc.,
a Virginia corporation,
its Limited Member
By: /s/ James W. Braswell
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Name: James W. Braswell
Title: Vice Presdient
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