EXHIBIT 10.30
AMENDED AND RESTATED
OPERATING AND MAINTENANCE AGREEMENT
BY AND BETWEEN
CALENERGY OPERATING COMPANY,
a Delaware corporation
AND
ELMORE, L.P.,
a California limited partnership
TABLE OF CONTENTS
Page
1. Definitions ......................................... 2
2. Operator's Services ................................. 2
3. Standard of Services ................................ 4
4. Personnel ........................................... 5
5. Inspection .......................................... 5
6. Change in Duties; Notification ...................... 5
7. Responsibilities of Owner ........................... 6
8. Facilities Revenue Fund ............................. 6
9. Guaranteed Capacity Payment ......................... 6
10. Reimbursement Charges ............................... 7
11. Subcontracting ...................................... 8
12. Term and Termination ................................ 8
13. Indemnification ..................................... 9
14. Non-Waiver of Breach ................................ 9
15. Arbitration ......................................... 9
16. Attorneys' Fees ..................................... 10
17. Force Majeure ....................................... 10
18. Invalid Provision ................................... 11
19. Assignment .......................................... 12
20. Governing Law ....................................... 12
21. Entire Agreement - Amendments ....................... 12
22. Communications ...................................... 12
23. Counterparts ........................................ 13
24. Exhibits ............................................ 13
25. Third Party Beneficiaries ........................... 13
26. Headings ............................................ 13
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TABLE OF EXHIBITS
-----------------
Section
-------
Exhibit "A" Guaranteed Capacity Payment 9.1
Target Levels
5
TABLE OF SCHEDULES
------------------
Section
-------
Schedule "Z" Schedule of Defined Terms 1.1
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AMENDED AND RESTATED
OPERATING AND MAINTENANCE AGREEMENT
PREAMBLE
THIS AMENDED AND RESTATED OPERATING AND MAINTENANCE AGREEMENT (the
"Agreement") is made as of June 17, 1996, by and between CALENERGY OPERATING
COMPANY, a Delaware corporation ("Operator"), and ELMORE, L.P., a California
limited partnership ("Owner").
RECITALS
A. Owner owns the Elmore Facility located in the Salton Sea Known
Geothermal Resource Area ("SSKGRA").
B. Owner intends to operate the Elmore Facility under the following
operating agreements: (i) an Administrative Services Agreement by and between
Owner and Operator, pursuant to which Operator will provide certain
administrative services to Owner for the operation of the Elmore Facility in
addition to the Services provided hereunder; (ii) a Technology Transfer
Agreement by and between Owner and Magma Power Company, a Nevada corporation
("Magma"), pursuant to which Magma will provide Owner with the nonexclusive
right to use certain "Technology" and "Know-How" in connection with the
operation of the Elmore Facility; (iii) a Ground Lease by and between Owner,
as lessee, and Magma, as lessor, pursuant to which Magma will lease to Owner
the real property upon which the Elmore Facility is located; (iv) an Easement
Grant Deed and Agreement Regarding Rights for Geothermal Development by and
between Owner and Magma pursuant to which Magma will supply Owner with the
right to extract Geothermal Brine and use geothermal brine-derived steam which
is necessary to operate the Elmore Facility; and (v) a Power Purchase Contract
by and between Owner and Southern California Edison Company.
C. Owner desires to exploit Operator's personnel resources, and to
that end Owner desires to employ, hire or otherwise retain Operator for
purposes of performing the day-to-day operations at the Elmore Facility.
NOW, THEREFORE, in consideration of the foregoing recitals and the
mutual covenants and agreements set forth herein, the parties hereto agree as
follow:
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AGREEMENT
1. Definitions.
1. Unless the context shall otherwise require, capitalized
terms used and not otherwise defined herein shall have the respective meanings
assigned thereto in Schedule Z hereto both of which shall be incorporated by
reference herein.
2. Operator's Services. In consideration of the payment by Owner to
Operator of the Guaranteed Capacity Payment and the Reimbursement Charges,
Operator agrees to perform during the term of this Agreement the following
services (the "Services"):
(a) Operator shall operate, maintain, and repair (or cause to
be operated, maintained, and repaired) the equipment associated with the
Elmore Facility, including all work normally considered part of the
operational and maintenance activities for facilities similar to the
Elmore Facility, and shall engage, supervise, and be responsible for any
and all personnel and Subcontractors necessary for the continuous
operation of the Elmore Facility. Notwithstanding the provisions of
Section 2(f) hereof, when specialized maintenance and repairs to the
Elmore Facility are required which cannot reasonably be performed by
Operator, Operator will subcontract with original equipment
manufacturers or similarly qualified personnel acceptable to Owner. Said
operations, maintenance, and repairs will be provided in accordance with
the requirements determined by Owner during the term of this Agreement.
Owner may modify, delete or supplement said requirements from time to
time as Owner, in its sole discretion, deems appropriate. Notice of any
changes or modifications in service requirements which may occur shall
be provided by Owner to Operator in writing. If Operator, in the
exercise of good faith, believes that an emergency exists and that
certain changes or modifications in service requirements are required to
avoid or mitigate serious damage to the Elmore Facility or injury to its
personnel or others, Operator may make such changes or modifications, to
the extent so necessary and required.
(b) Consistent with good engineering and operations practices,
Operator shall provide its Services so as to optimize both the
profitability of the Elmore Facility and the useful life of the
equipment as well as minimize downtime for repairs. Subject to the
provisions of this Agreement, Operator shall provide all labor,
material, and equipment necessary for such purposes.
(c) Operator shall develop and implement a preventive
maintenance program based upon, among other things, information and
procedures provided to Operator by Owner, which shall include on-going
operational maintenance. This preventive maintenance program shall be
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implemented and carried out by Operator in accordance with the
specifications provided by Owner.
(d) Operator shall implement and maintain a Elmore Facility
safety and loss prevention program. Operator shall take all reasonable
precautions for the safety of its employees and shall comply with all
applicable provisions of federal, state and municipal laws, building
codes and insurance policies to prevent accidents or injuries to persons
or damage to property within or about the Elmore Facility.
(e) Operator shall maintain, inventory, and procure
replacement Spare Parts and specialized tools in order to maximize the
continuous operation of the Elmore Facility, and procure, inventory, and
maintain chemicals, consumables and working supplies necessary to carry
out the Services. Owner will provide a location for storage of Spare
Parts, chemicals, consumables and supplies.
(f) Subject to Owner's prior approval, Operator may
subcontract to qualified Subcontractors, including, without limitation,
Affiliates of Operator, such routine or non-routine work as is necessary
to perform scheduled or unscheduled maintenance and repairs, annual
inspections, and equipment overhauls; Operator shall supervise all work
subcontracted. The subcontracting of any work to outside Subcontractors
shall in no way relieve or excuse Operator from any of its obligations
under this Agreement with respect to said work. Subcontracts with
Affiliates of Operator shall be on a competitive and arms-length basis.
All charges associated with work subcontracted by Operator shall be
billed to Owner in accordance with Section 10 hereof.
(g) Operator shall arrange for scheduled testing and
recalibration to assure accuracy of scales, metering units (geothermal
and electric) and associated recording devices.
(h) Operator shall be responsible for providing security for
the Elmore Facility.
(i) Subject to shutdowns for scheduled maintenance, Operator
shall to the maximum extent achievable under the law and pursuant to the
terms of the Elmore Power Purchase Contract, use its best efforts to
maintain the Elmore Facility in operation, producing energy at its full
rated capacity, twenty-four (24) hours per day, seven (7) days per week
throughout the entire year, including legal and other holidays, unless
otherwise directed by Owner.
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(j) At the request of Owner, Operator shall assist Owner in
obtaining any franchises, permits, licenses, easements, or rights-of-way
necessary for continued operation of the Elmore Facility.
(k) Operator shall employ such staff as is reasonably
necessary to perform routine, ministerial record keeping and
administrative functions of the Del Ranch Facility as reasonably
required by Owner for its use in billings, accounting for receipts and
payments, complying with governmental laws and regulations, with
generally acceptable accounting principles and with reporting
requirements of any Elmore Facility finance agreement or other agreement
of Owner.
(l) Operator shall pursue warranty claims on behalf of Owner.
(m) Operator shall establish and maintain such bank accounts
in the name and on behalf of Owner as may be necessary or desirable for
the performance of its obligations hereunder. All such accounts and all
amounts from time to time deposited therein shall be and remain the
property of Owner and shall be subject to withdrawal by Owner from time
to time in its discretion.
(n) Operator shall operate the Elmore Facility in compliance
with all permit conditions and applicable laws.
(o) Operator shall dispose of all Geothermal Brine Scale and
all Partially Spent Geothermal Brine from the operation of the Elmore
Facility (unless utilized by Magma pursuant to Section 2.3.3 of the
Easement Agreement) and all Totally Spent Geothermal Brine to the extent
Owner is required to dispose thereof pursuant to the Easement Agreement.
(p) Operator shall be responsible for discharging all duties
and obligations, and protecting all rights, of Owner under the Credit
Facility, the Limited Partnership Agreement, the Elmore Power Purchase
Contract and the other Operating Agreements.
3. Standard of Services. Operator agrees to use good faith efforts
to perform all Services in accordance with the reasonable, good, and prudent
business practices applicable to the geothermal electrical generating
production industry and in a manner no less favorable than practices employed
by operators of other power production geothermal electrical generating
facilities, including, without limitation, Magma. Operator shall exercise its
good faith efforts to ensure that:
(a) the Elmore Facility shall at all times be kept in as near
"as new" condition, ordinary wear and tear and Owner's operating
requirements considered, as can reasonably be achieved;
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(b) the Services shall be rendered in accordance with
manufacturers' and systems designers' specifications as delivered to
Operator by Owner;
(c) the Elmore Facility shall at all times be operated and the
Services shall at all times be provided in accordance with all of the
terms of the Operating Agreements and all applicable codes, governmental
requirements or court orders (including, without limitation, all zoning,
environmental protection, pollution, sanitary, and safety laws) except
to the extent compliance with such requirements has been excused or
exempted by the applicable governmental or judicial authority;
(d) the Elmore Facility shall be operated in a manner required
such that the Elmore Facility is a "qualifying facility" as provided in
18 C.F.R. ss. 292.203, as the same may be amended from time to time; and
(e) the Elmore Facility shall be operated at all times in such
a manner that it shall comply with all safety and other requirements of
insurance policies in effect at said times with respect to the Elmore
Facility or any part thereof and with the reasonable request of insurers
and that all warranties with respect to the Elmore Facility or any part
thereof shall be kept in full force and effect.
4. Personnel. Operator shall provide and employ qualified plant
management, operations and maintenance personnel in sufficient numbers to
accomplish its Services hereunder and to comply with sound engineering and
operations practices. During the term of this Agreement, a duly authorized
on-site manager shall represent Operator at all times. All personnel shall
meet minimum job qualifications associated with their positions as determined
mutually by Owner and by Operator. Operator's personnel shall possess
experience and training equal to standards generally set within the industry
to operate and maintain substantially similar equipment. Operator will use its
best efforts to hire competent and experienced personnel at competitive
compensation.
5. Inspection. Operator shall ensure that the Elmore Facility and
all records of the Elmore Facility will at all times be open to Owner for
inspection and review of operations and maintenance practices.
6. Change in Duties; Notification. Owner shall notify Operator of
the execution or amendment of each Operating Agreement and the Limited
Partnership Agreement which affects the Elmore Facility or the operation
thereof and which directly relates to the performance of Operator's duties
under this Agreement. Owner shall furnish to Operator a description of the
provisions of such agreement or amendment which directly relates to the
performance of Operator's duties under this Agreement in sufficient detail to
enable Operator to satisfactorily perform its duties hereunder.
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7. Responsibilities of Owner. Owner will bear responsibility for,
among other things, reviewing and approving all required plans, budgets and
schedules in a timely fashion.
8. Facilities Revenue Fund. Subject to the provisions of the Credit
Facility and related loan documents regarding accounts:
1. Operator shall deposit all revenues received by Owner in
connection with the operation of the Facilities into the Revenue Fund (as
defined in the Credit Facility and related loan documents).
2. Operator is authorized to withdraw monies from the Revenue
Fund to pay costs of performing its obligations only to the extent that the
funds are then available in the Revenue Fund and such payments are authorized
pursuant to the terms of this Agreement and the Credit Facility and related
loan documents.
9. Guaranteed Capacity Payment. As an inducement to Operator to
operate the Elmore Facility, to the extent reasonably possible, in such a
manner as to, among other things, earn the maximum Total Electricity Revenues
possible on behalf of Owner, Owner shall pay Operator a fee (the "Guaranteed
Capacity Payment") calculated as follows:
1. The Guaranteed Capacity Payment, to the extent earned by
Operator, shall be paid to Operator on the last day of each of Owner's fiscal
years (or as soon thereafter as is reasonably practicable, but in no event
later than the next succeeding March 31) in an amount which is, for each of
Owner's fiscal years from 1989 through 1998 inclusive, the sum of the
following amounts:
(a) ten percent (10%) of the amount of Total Electricity
Revenues earned by Owner in such year in excess of the amount listed in
column A of Exhibit "A" with respect to such year up to and including
the amount listed in column B of Exhibit "A" with respect to such year;
plus
(b) twenty-five percent (25%) of the amount of Total
Electricity Revenues earned by Owner in such year in excess of the
amount listed in column B of Exhibit "A" with respect to such year.
2. The Guaranteed Capacity Payment, to the extent earned by
Operator, shall be paid to Operator on the last day of each of Owner's fiscal
years (or as soon thereafter as is reasonably practicable, but in no event
later than the next succeeding March 31) in an amount which is, for each of
Owner's fiscal years from 1999 through the end of the term of this Agreement
inclusive, the sum of the following amounts:
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(a) ten percent (10%) of the amount of Total Electricity
Revenues earned by Owner in such year in excess of the amount which is
obtained by multiplying 268,056,000 by the Average Annual Energy Price
for such year up to and including the amount which is obtained by
multiplying 297,840,000 by the Average Annual Energy Price for such
year; plus
(b) twenty-five percent (25%) of the amount of Total
Electricity Revenues earned by Owner in such year in excess of the
amount which is obtained by multiplying 297,840,000 by the Average
Annual Energy Price for such year.
3. To the extent that there are not sufficient funds to pay
the Guaranteed Capacity Payment, any such shortfall (the "Accrued Guaranteed
Capacity Payment") shall accrue and be payable to Operator, with interest
thereon at a rate of seven percent (7%) per annum, on the next date for
payment of the Guaranteed Capacity Payment and any Accrued Guaranteed Capacity
Payment shall be paid prior to the Guaranteed Capacity Payment due on the date
on which such payment is made.
10. Reimbursement Charges.
1. In consideration of the provision by Operator to Owner of
the Services and in addition to the amounts payable to Operator pursuant to
Section 9 hereof, within ten (10) days after Owner has received an invoice
from Operator specifying the Services rendered to Owner by Operator and the
amount of actual costs and expenses incurred by Operator in rendering such
Services, Owner shall pay to Operator such specified amount. As used in this
Section 10, "actual costs and expenses incurred by Operator" includes, without
limitation, (a) the actual cost to Operator of goods and materials used by
Operator in rendering Services, (b) the pro rata cost to Operator of personnel
providing labor or services in the course of Operator's provision of Services,
(c) the portion of the cost of invested capital incurred by Operator for the
purchase of machinery and equipment used by Operator in connection with the
provision of Services fairly allocable to the use of such machinery and
equipment for performing the Services hereunder, taking into consideration
factors including the extent to which Operator can reasonably expect to earn a
return on its invested capital by utilizing such machinery and equipment for
providing services other than to the Elmore Facility and (d) the actual cost
to Operator, without any mark-up by Operator whatsoever, of retaining a
Subcontractor, whether an Affiliate of Operator or otherwise, in connection
with the provision of Services.
2. With respect to any calculation of actual costs and
expenses or any allocation of costs contemplated by Section 10.1 hereof, Owner
shall be bound by Operator's determination thereof unless the same is clearly
erroneous.
11. Subcontracting. Without limiting the generality of any
provision contained herein concerning the same subject matter as this Section
11, in the event Operator determines it to be reasonably necessary to render
the Services required hereunder through a Subcontractor, Operator may
subcontract with Affiliates of Operator, and Owner hereby
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consents to such subcontracting for all purposes of this Agreement. For
purposes of this Agreement, any Services performed by such Affiliates shall be
deemed to have been performed by Operator.
12. Term and Termination.
1. Unless terminated as provided in Section 18 hereof, by
written agreement between Owner and Operator as provided in Section 21 hereof,
or as hereinafter provided in this Section 12, this Agreement shall remain in
effect until, and shall terminate on March 14, 2020.
2. In the event of a material default by either party in the
performance of its duties, obligations or undertakings under this Agreement,
the other party shall have the right to give written notice to the defaulting
party advising such party of the specific default involved and, if within
thirty (30) days after such notice the defaulting party shall not have
remedied or commenced diligently to remedy the default, the other party shall
have the right, in addition to any other rights and remedies it may have, to
terminate this Agreement upon ten (10) days' written notice to the defaulting
party.
3. Notwithstanding any other provision of this Agreement, and
in addition to any other right it may have, Operator shall have the right to
terminate this Agreement, effective immediately, if, at any time, Owner is
adjudged bankrupt or insolvent, or files a petition in bankruptcy or an answer
admitting the material facts recited in such a petition filed by another, or
is put or decides to go into dissolution or liquidation (other than in
connection with a merger, consolidation or amalgamation), or otherwise
discontinues business, makes an assignment for the benefit of its creditors or
any other general arrangement with its creditors, becomes insolvent or unable
to meet its current payments, or has a receiver or other custodian of any kind
appointed to administer any substantial amount of its property, or otherwise
seeks to take advantage of any bankruptcy or insolvency statute now or
hereafter in effect.
4. If this Agreement is terminated prior to the expiration of
its terms, Owner and Operator shall have the following rights, remedies and
obligations in addition to any other rights, remedies and obligations they may
have:
(a) Owner shall pay Operator the Guaranteed Capacity Payment,
if any, earned by Operator as of the date this Agreement is effectively
terminated in the manner and subject to the conditions provided for in Section
9 hereof.
(b) Owner shall pay Operator all amounts due and payable to
Operator under Section 10 hereof as of the date the Agreement is effectively
terminated.
13. Indemnification.
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1. Owner shall defend, indemnify and hold Operator and its
agent and employees harmless from and against any and all other liabilities,
claims, damages, losses and expenses, including attorneys' fees and costs and
expenses of litigation or arbitration, of every kind and nature arising out of
the course of performance of this Agreement by Owner or Operator and shall,
upon request of Operator, defend all suits arising out of or resulting from
the performance of this Agreement by Owner or Operator, provided that such
liability, claim, damage, loss or expense is not attributable to the gross
negligence or willful misconduct of Operator.
2. Operator shall defend, indemnify and hold Owner and its
agents and employees harmless from and against any and all liabilities,
claims, damages, losses and expenses, including attorneys' fees and costs and
expenses of litigation or arbitration, of every kind and nature arising out of
Operator's gross negligence or willful misconduct in the course of Operator's
performance of this Agreement and shall, upon request of Owner, defend all
suits arising out or resulting from Operator's gross negligence or willful
misconduct in the performance of this Agreement.
14. Non-Waiver of Breach. Either party hereto may specifically
waive any breach of this Agreement by the other party, but no such waiver
shall be deemed to have been given unless such waiver is in writing, signed by
the waiving party and specifically designates the breach waived, nor shall any
such waiver constitute a continuing waiver of similar or other breaches.
15. Arbitration. All disputes arising under this Agreement shall be
settled by arbitration. The party desiring such arbitration shall give written
notice to that effect to the other party and in such notice shall appoint as
an arbitrator a disinterested person of recognized competence in the area at
issue. Within fifteen (15) days thereafter, the other party shall, by written
notice to the originating party, appoint a second person similarly qualified
as the second arbitrator. The arbitrators thus appointed shall appoint a third
person similarly qualified as the third arbitrator, and such three arbitrators
shall as promptly as possible determine such matter with the parties, each
being entitled to present evidence and argument to the arbitrators; provided,
however, that:
(a) if the second arbitrator shall not have been appointed as
aforesaid, the first arbitrator shall determine such matter; and
(b) if the two arbitrators appointed by the party shall be
unable to agree upon the appointment of a third arbitrator within
fifteen (15) days after the appointment of the second arbitrator, they
shall give written notice of such failure to agree to the parties, and,
if the parties fail to agree upon the selection of such third arbitrator
within fifteen (15) days thereafter, then within ten (10) days
thereafter, either of the parties upon written notice to the other party
may apply for such appointment to the Federal District Court or District
Court in Omaha, Nebraska.
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The arbitrator or arbitrators shall only interpret and apply the
terms and provisions of this Agreement and shall not change any such terms or
provisions or deprive either party of any right or remedy expressly or
impliedly provided for in this Agreement.
The determination of the majority of the arbitrators or the sole
arbitrator, as the case may be, shall, to the extent permitted by law, be
conclusive upon the parties. The arbitrator or arbitrators shall give written
notice to the parties stating their determination, and shall furnish to each a
copy of such determination signed by them. In the event of the failure,
refusal or inability of any arbitrator to act, a new arbitrator shall be
appointed in his stead, which appointment shall be made in the same manner as
hereinbefore provided for the appointment of the arbitrator so failing,
refusing or unable to act.
16. Attorneys' Fees. If either party hereto commences litigation or
arbitration for the judicial or other interpretation, enforcement,
termination, cancellation or rescission hereof, or for damages for the breach
hereof, the prevailing party in any such action, trial, arbitration or appeal
thereon shall be entitled to its reasonable attorneys' fees and court,
arbitration and other costs incurred, to be paid by the losing party as fixed
by the court or arbitrator in the same or a separate suit, and whether or not
such action is pursued to decision or judgment.
17. Force Majeure.
1. Neither Owner nor Operator shall be liable in damages to
the other for any act, omission or circumstance ("Event of Force Majeure")
occasioned by or in consequence of any acts of God, acts of the public enemy,
wars, blockades, insurrections, riots, epidemics, landslides, lightning,
earthquakes, fires, storms, floods, civil disturbances, explosions, sabotage,
the binding order of any court or governmental authority which has been
resisted in good faith by all reasonable legal means, Federal, State or local
laws, or other event or circumstance not within the control of such party
preventing such party from performing its obligations hereunder, whether
caused or occasioned by, or happening on account of, the act or omission of
one of the parties, not within the control of the party claiming suspension
and which by the exercise of due diligence such party is unable to prevent or
overcome.
2. Such Events of Force Majeure shall not relieve Owner or
Operator of liability in the event of either party's concurring negligence or
in the event of either party's failure to use due diligence to remedy the
situation and to remove the cause in an adequate manner and with all
reasonable dispatch, nor shall such Events of Force Majeure relieve either
party of liability unless such party shall give notice and full particulars of
the same in writing to the other party within ten (10) days of the occurrence
relied on. In no event, however, shall an Event of Force Majeure relieve Owner
from the obligation of making payments due under this Agreement at the time of
such occurrence. The parties agree that should any Event of Force Majeure
remain in existence for a period of six (6) months, this Agreement may be
terminated by the party not claiming suspension of the Agreement under such
Event of Force Majeure upon the giving of written notice by such party to the
other; provided, however, that
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such six (6) month period shall be extended for a reasonable time so long as
throughout such six (6) month period the party claiming suspension of this
Agreement under the Event of Force Majeure has diligently proceeded to
terminate the Event of Force Majeure and continues to do so throughout such
extension.
18. Invalid Provision.
1. The invalidity or unenforceability of any particular
provision of this Agreement shall not affect the other provisions hereof, and
this Agreement shall be construed in all respects as if such invalid or
unenforceable provisions were omitted; provided, however, that if any of the
provisions of Sections 9, 10 or 11 hereof are held invalid or unenforceable by
any court or other relevant authority, Owner and Operator shall hold
consultations over a period of ninety (90) days, commencing immediately, in an
effort to work out satisfactory terms for continuation of this Agreement. If
Owner and Operator do not reach agreement within this period, Operator shall
have the right to terminate this Agreement, effective immediately.
2. In the event that any provision, term, condition or object
of this Agreement may be in conflict with any law, measure, ruling, court
judgment (by consent or otherwise), or regulation of the government of the
United States of America, and the legal counsel of either party shall advise
that in their considered opinion such conflict, or a reasonable possibility of
such conflict, exists, then either party may propose to the other appropriate
modifications of this Agreement to avoid such conflict. In such case, if an
agreement of modification is not reached within ninety (90) days from such
proposal, the party making such proposal, after sixty (60) days' written
notice to the other party, may terminate the agreement in its entirety as of a
date subsequent to such sixty (60) days, and which shall be specified in such
notice.
19. Assignment. Subject to Section 11 hereof, neither Owner nor
Operator shall grant, assign or otherwise convey any of their respective
rights or delegate any of their respective obligations under this Agreement
without the prior written consent of the other party which shall not be
unreasonably withheld.
20. Governing Law. The existence, validity, construction, operation
and effect of this Agreement shall be determined in accordance with and
governed by the laws of the State of California. This Agreement shall be
construed equally as against the parties hereto, and shall not be construed
against the party responsible for its drafting.
21. Entire Agreement - Amendments. This Agreement constitutes the
entire agreement of the parties and the provisions hereof shall supersede any
and all prior agreements or understandings relating to the same subject
matter. Without limiting the generality of the foregoing, from and after the
date hereof, the terms of the Operating and Maintenance Agreement dated as of
March 14, 1988 (the "Original Operating and Maintenance Agreement") between
Owner and Operator shall be amended to read in their entirety as set forth in
this Agreement and the terms of this Agreement shall govern and control the
rights
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and obligations of the parties in and with respect to the matters herein set
forth, notwithstanding any conflict between the terms of this Agreement and
the terms of the Original Operating and Maintenance Agreement. This Agreement
may be amended only by a writing signed by a duly authorized representative of
both parties.
22. Communications. All notices, requests, offers and other
communications required or permitted to be made under this Agreement shall be
in writing and shall be deemed to have been duly given and received,
regardless of when and whether received, either: (a) on the day of delivery,
if delivered:
To Operator at:
CalEnergy Operating Company
302 South 36th Street
Suite 400-C
Omaha, Nebraska 68131
Attention: General Counsel
To Owner at:
Elmore, L.P.
302 South 36th Street, Suite 400-C
Omaha, Nebraska 68131
Attention: General Counsel
or at such other address as either party most recently may have designated in
writing to the other party for such purpose; or (b) on the day sent, when sent
by prepaid telex, telegram, cable or radiogram, and confirmed the same day by
prepaid first-class registered airmail, addressed to Operator or Owner, as the
case may be, at their respective addresses aforesaid.
23. Counterparts. This Agreement may be executed in counterparts
and any number of counterparts signed in the aggregate by the parties hereto
shall constitute a single original instrument.
24. Exhibits. All exhibits and schedules attached hereto are hereby
incorporated herein by this reference.
25. Third Party Beneficiaries. The covenants contained herein are
made solely for the benefit of the properties, parties and successors and
assigns of such parties as specified herein, and shall not be construed as
having been intended to benefit any third party not a party to this Agreement.
26. Headings. The headings herein are for reference only and shall
not affect the construction of this Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be signed by their duly authorized officers as of the day and year first
above written.
OWNER:
ELMORE, L.P.,
a California limited partnership
By: CALENERGY OPERATING COMPANY,
a Delaware corporation,
as General Partner
By: /s/ John G. Sylvia
Name: John G. Sylvia
Title: Senior Vice President
OPERATOR:
CALENERGY OPERATING COMPANY,
a Delaware corporation
By: /s/ John G. Sylvia
Name: John G. Sylvia
Title: Senior Vice President
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Exhibit "A"
Guaranteed Capacity Payment Target Levels
-----------------------------------------
($000s)
Column Column
Year A B
- ---- ------ ------
1989 27,391 30,435
1990 28,738 31,944
1991 30,078 33,433
1992 31,955 35,518
1993 34,099 37,901
1994 36,243 40,283
1995 38,656 42,964
1996 40,800 45,346
1997 43,481 48,324
1998 46,161 51,303
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