Document:

EXHIBIT 10.6

 

This instrument, when recorded,

should be returned to:

 

Christopher J. Moore

Orrick, Herrington & Sutcliffe LLP

666 Fifth Avenue

New York, NY  10103-0001

 

Cross
Reference:

Book
1408

Page 661

Floyd
County, Georgia

 

AMENDMENT NO. 1 TO
FACILITY SUBLEASE AGREEMENT (P1)

 

THIS AMENDMENT NO. 1 TO FACILITY SUBLEASE
AGREEMENT (P1) (this “Amendment”) is made as of May 22, 2009, by
and between (i) OGLETHORPE POWER
CORPORATION, (AN ELECTRIC MEMBERSHIP CORPORATION), an electric
membership corporation organized under the laws of the State of Georgia
(herein, together with its successors and permitted assigned, called “Oglethorpe”),
and (ii) ROCKY MOUNTAIN LEASING CORPORATION,
a corporation organized under the laws of the State of Delaware (herein,
together with its successors and permitted assigned, called “RMLC”).  Capitalized terms used but not defined herein
shall have the meaning ascribed to them in the Facility Sublease (as defined
below) or in Appendix A thereto, as heretofore amended.

 

W I T N E S S E T H  T H A T

 

WHEREAS, on December 30, 1996, Oglethorpe and
RMLC entered into the Facility Sublease Agreement (P1), filed for record on August 7,
1997 in Book 1408 Page 661 of the Floyd County, Georgia land records (the “Facility
Sublease”) pursuant to which RMLC leased to Oglethorpe the Undivided
Interest (leased to RMLC by the Co-Trustee pursuant to the Facility Lease) upon
the terms and conditions set forth therein;

 

WHEREAS, pursuant to Section 8.6 of the
Participation Agreement, Oglethorpe has caused Berkshire Hathaway Assurance
Corporation (“Berkshire”) to issue a surety bond in favor of the
Facility Sublessor and the Facility Lessor, 
with respect to certain obligations of Oglethorpe under the Facility
Sublease and the obligations of Ambac Assurance Corporation, formerly known as
AMBAC Indemnity Corporation, under the Surety Bond (Facility Sublease-P1) No. SF0004BE,
as may be amended, or amended and restated, from time to time; and

 

WHEREAS, in connection with the issuance by Berkshire
of such surety bond, each of the parties hereto wishes to amend the Facility
Sublease to include an additional Sublease Event of Default.

 

 

NOW THEREFORE, in consideration of the premises and
for other good and valuable consideration, the receipt and adequacy of which are
hereby acknowledged, the parties hereto hereby agree as follows:

 

Section 1.              Amendments
to Appendix A to the Facility Sublease

 

                Appendix A to the Facility Sublease is hereby
amended as follows:

 

                (i)            by deleting the defined term “AMBAC Indemnity” and replacing
the definition of “AMBAC”, in its entirety, with the following language:

 

                                “AMBAC” shall mean
Ambac Assurance Corporation (formerly named AMBAC Indemnity Corporation), a
Wisconsin-domiciled stock-insurance corporation.  Any reference herein to “AMBAC Indemnity”
shall be a reference to “AMBAC.”

 

                (ii)           by adding the following definitions thereto:

 

 “AMBAC Sublease Surety Bond”
shall mean the Amended and Restated Surety Bond (Facility Sublease-P1) No. SF0004BE
issued on May 22, 2009 by AMBAC in favor of the Facility Sublessor and the
Facility Lessor.

 

“Berkshire”
shall mean Berkshire Hathaway Assurance Corporation.

 

“Berkshire
Sublease Surety Bond” shall mean the Surety Bond (Facility
Sublease-P1) No. 98SRD102495 issued by Berkshire in favor of the Facility
Sublessor and the Facility Lessor.

 

“Equity Portion of
Sublease Basic Rent” shall mean for any Rent Payment Date the difference
between (i) Sublease Basic Rent scheduled to be paid under the Facility
Sublease on such Rent Payment Date and (ii) the principal and interest
scheduled to be paid on the Loan Certificate on such Rent Payment Date.

 

Section 2.              Other
Amendments to the Facility Sublease

 

(a)           Section 16
of the Facility Sublease is hereby amended by adding a new clause (t) after
the end thereof to read in its entirety as follows:

 

                “(t)          Berkshire has delivered to the Facility Lessor or
the Facility Sublessor a notice of termination for the non-payment of premiums
in substantially the same form as Attachment III to the Berkshire Sublease
Surety Bond and Berkshire has not received payment in full of the unpaid
portion of the premium within 14 days from the date of such notice of
termination; provided, however, that no
Facility Sublease Event of Default shall occur under this paragraph (t) if
the Owner Participant notifies the Facility Lessor, the Facility Sublessor and
the Lender in writing that the receipt of such notice of termination shall not
constitute a Facility Sublease Event of Default.”

 

2

 

(b)           Section 17.1(e) of
the Facility Sublease is hereby amended by inserting the following
parenthetical immediately after the words “by written notice to the Facility
Sublessee”:

 

                “(a copy of which notice may be delivered by
the Facility Lessor to Berkshire in accordance with Section 1(c)(i) of
the Berkshire Sublease Surety Bond and shall constitute the “Oglethorpe Payment
Demand” referred to therein)”.

 

(c)           Section 17.1(f) of
the Facility Sublease is hereby replaced, in its entirety, with the following
language:

 

“if the Facility Sublessor
shall have sold the Facility Sublessor’s Rocky Mountain Interest pursuant to
paragraph (c) above, the Facility Sublessor may, if it shall so elect,
demand that the Facility Sublessee pay to the Facility Sublessor, and the
Facility Sublessee shall pay to the Facility Sublessor, as liquidated damages
for loss of a bargain and not as a penalty (in lieu of the Sublease Basic Rent
due for any periods subsequent to the date of such sale), an amount equal to (A) any
unpaid Sublease Basic Rent due before the date of such sale and, (B)(i) if
that date is a Rent Payment Date, the Sublease Basic Rent due on that date (to
the extent payable in arrears), or, (ii) if that date is not a Rent
Payment Date or a Termination Date, the daily equivalent (for the period from
the previous Termination Date to the date of such sale) of Sublease Basic Rent
due on the next Rent Payment Date (as if all such Sublease Basic Rent
is payable and accruing in arrears with respect to the 6-month period
preceding such Rent Payment Date, whether Sublease Basic Rent on such Rent
Payment Date is payable in advance or in arrears), plus (C) the amount, if
any, by which the Sublease Termination Value computed as of the Termination
Date next preceding the date of such sale (or, if such sale occurs on a
Rent Payment Date or a Termination Date, then Sublease Termination Value
computed as of such date (provided that if such Termination Date is also a Rent
Payment Date on which Sublease Basic Rent is payable in advance, such Sublease
Termination Value shall be reduced by the amount of Sublease Basic Rent shown
as advance Sublease Basic Rent opposite such date on Schedule 2 to the Facility
Sublease)), exceeds the net proceeds of such sale, and, upon payment of such
amount, this Facility Sublease and the Facility Sublessee’s obligation to pay
Sublease Basic Rent for any periods subsequent to the date of such payment
shall terminate; or”

 

(d)           Section 17.1(g) of
the Facility Sublease is hereby replaced, in its entirety, with the following
language:

 

“the Facility Sublessor or upon an Event of Default,
the Facility Lessor, as security assignee, may draw upon any Qualifying
Sublease Surety Bond, the AMBAC Sublease Surety Bond and/or the Berkshire
Sublease Surety Bond (in each case, whether any of the foregoing was “qualifying”
as of or after the Berkshire Surety Bond Date under the definitions herein or
not) and all proceeds thereof shall be applied (as determined by the Facility
Sublessor, or upon an Event of Default, the Owner Participant) to the Facility
Sublessee’s obligations to pay Sublease Rent and, to the extent any such
proceeds received are so applied by the Facility Sublessor or the Facility
Lessor, as security assignee, such proceeds shall reduce the Facility 

 

3

 

Sublessee’s
obligations to pay such Sublease Rent (provided that Sublease Termination Value
shall not be reduced below the unpaid balance of principal and stated accrued
interest under the Loan Agreement).”

 

(e)           The Facility
Sublease is hereby amended by adding a new Section 25-11:

 

                                “Section 25-11.  Certain Agreements
Regarding Operative Documents. 
Oglethorpe agrees and acknowledges that the agreements made by
Oglethorpe under Section 4(b) of the Implementation Agreement (other
than its agreements with respect to the Head Lease or any Qualifying Head Lease
Surety Bond or Qualifying Letter of Credit issued in replacement therefor) are
hereby incorporated herein by reference.”

 

Section 3.              Reference
to Facility Sublease

 

Except as herein amended, the Facility Sublease shall
remain in full force and effect.  As
amended hereby, the Facility Sublease is hereby ratified, approved and
confirmed in all respects.  On and after
the date hereof, each reference to the Facility Sublease made in the Facility
Sublease or any agreement, document or instrument executed and delivered
pursuant to the Facility Sublease by the parties hereto, shall mean and be a
reference to the Facility Sublease as amended hereby and by the Amendment, Release
and Consent Agreement, dated as of July 30, 1999.

 

Section 4.              Governing
Law

 

This Amendment shall be in all respects governed by
and construed in accordance with the laws of the State of New York including
all matters of construction, validity and performance except to the extent the
law of the State of Georgia is mandatorily applicable.

 

Section 5.              Severability

 

If any provision hereof shall be invalid, illegal or
unenforceable under Applicable Law, the validity, legality and enforceability
of the remaining provisions hereof shall not be affected or impaired thereby.

 

Section 6.              Successors
and Assigns

 

(a)           This Amendment
shall be binding upon and shall inure to the benefit of, and shall be
enforceable by, the parties hereto and their respective successors and assigns
as permitted by and in accordance with the terms hereof.

 

(b)           Except as
expressly provided herein or in the other Operative Documents, neither party
hereto may assign its interests or transfer its obligations herein without the
consent of the other party hereto.

 

Section 7.              Amendments
and Waivers

 

No term, covenant, agreement or condition of this
Amendment may be terminated, amended or compliance therewith waived (either
generally or in a particular instance, 

 

4

 

retroactively or
prospectively) except by an instrument or instruments in writing executed by
each party hereto.

 

Section 8.              Counterparts

 

This Amendment may be executed by the parties hereto
in separate counterparts, each of which, subject to Section 24 of the
Facility Sublease, when so executed and delivered shall be an original, but all
such counterparts shall together constitute but one and the same instrument.

 

(Signature pages follow)

 

5

 

IN WITNESS WHEREOF, the parties have each caused this
Amendment to be duly executed as of the day and year first written above.

 

 

	
   

  	
  ROCKY MOUNTAIN LEASING
  CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Elizabeth B.
  Higgins

  
	
   

  	
   

  	
  Name:

  	
  Elizabeth B.
  Higgins

  
	
   

  	
   

  	
  Title:

  	
  President

  
	
   

  	
   

  
	
   

  	
   

  
	
  Signed,
  sealed and delivered in the presence of:

  	
   

  
	
   

  	
   

  
	
  /s/
  Thomas J. Brendiar

  	
   

  	
   

  
	
  Unofficial
  Witness

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  /s/
  Sharon H. Wright

  	
   

  	
   

  
	
  Notary
  Public

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  My
  commission expires:

  	
  October 14,
  2011

  	
   

  
						

 

 

[Notary Seal]

 

6

 

	
   

  	
  OGLETHORPE POWER
  CORPORATION (AN ELECTRIC MEMBERSHIP CORPORATION)

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Thomas A.
  Smith

  
	
   

  	
   

  	
  Name:

  	
  Thomas A. Smith

  
	
   

  	
   

  	
  Title:

  	
  President and
  Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
  Signed,
  sealed and delivered in the presence of:

  	
   

  
	
   

  	
   

  
	
  /s/
  Thomas J. Brendiar

  	
   

  	
   

  
	
  Unofficial
  Witness

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  /s/
  Sharon H. Wright

  	
   

  	
   

  
	
  Notary
  Public

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  My
  commission expires:

  	
  October 14,
  2011

  	
   

  
						

 

 

[Notary Seal]

 

7

 

Acknowledged and consented to by:

 

 

	
   

  	
  UTRECHT-AMERICA FINANCE
  CO.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Brett Delfino

  
	
   

  	
   

  	
  Name:

  	
  Brett Delfino

  
	
   

  	
   

  	
  Title:

  	
  Assistant
  Secretary

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Margaret
  Schaubeck

  
	
   

  	
   

  	
  Name:

  	
  Margaret
  Schaubeck

  
	
   

  	
   

  	
  Title:

  	
  Assistant Treasurer

  
	
   

  	
   

  
	
   

  	
   

  
	
  Signed,
  sealed and delivered in the presence of:

  	
   

  
	
   

  	
   

  
	
  /s/
  Geert C. Kortlandt

  	
   

  	
   

  
	
  Unofficial
  Witness

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  /s/
  Shannon Smith

  	
   

  	
   

  
	
  Notary
  Public

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  My
  commission expires:

  	
  November
  5, 2011

  	
   

  
						

 

 

[Notary Seal]

 

8

 

SCHEDULE TO EXHIBIT 10.6

 

AMENDMENT NO. 1 TO FACILITY SUBLEASE AGREEMENT (P1)

 

                The following table
indicates for each transaction the name of the corresponding Owner Participant:

 

	
  Amendment
  to 

  Agreement

  	
   

  	
  Date

  	
   

  	
  Owner Participant

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  P2

  	
   

  	
  May 22, 2009

  	
   

  	
  Philip
  Morris Capital Corporation

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  F3

  	
   

  	
  May 22, 2009

  	
   

  	
  First
  Chicago Leasing Corporation

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  F4

  	
   

  	
  May 22, 2009

  	
   

  	
  First
  Chicago Leasing Corporation

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  N6

  	
   

  	
  May 22, 2009

  	
   

  	
  Philip
  Morris Capital Corporation

  (transferee from NationsBanc Leasing & R.E. Corporation)EXHIBIT 10.7

 

EXECUTION COPY

 

SURETY BOND IMPLEMENTATION AGREEMENT

(P1)

 

This
SURETY BOND IMPLEMENTATION AGREEMENT (P1), dated as of May 22, 2009 (“Agreement”),
is made by and among:

 

(a)           OGLETHORPE POWER CORPORATION (AN
ELECTRIC MEMBERSHIP CORPORATION), an electric membership corporation organized
under the laws of the State of Georgia (“Oglethorpe”);

 

(b)           ROCKY MOUNTAIN LEASING CORPORATION, a
corporation organized under the laws of the State of Delaware (“RMLC”);

 

(c)           PHILIP MORRIS CAPITAL CORPORATION, a corporation
organized under the laws of the State of Delaware (the “Owner Participant”);

 

(d)           U.S. BANK NATIONAL ASSOCIATION
(successor in interest to Fleet National Bank), a national banking association,
not in its individual capacity, except as expressly provided herein, but solely
as a trustee under the Trust Agreement (in such capacity, the “Owner Trustee”);

 

(e)           U.S. BANK NATIONAL ASSOCIATION
(successor in interest to SunTrust Bank, Atlanta), a national banking
association, not in its individual capacity, except as expressly provided
herein, but solely as a trustee under the Trust Agreement (in such capacity,
the “Co-Trustee”);

 

(f)            AMBAC ASSURANCE CORPORATION
(formerly known as AMBAC Indemnity Corporation), a Wisconsin-domiciled stock
insurance corporation (“AMBAC”); and

 

(g)           BERKSHIRE HATHAWAY ASSURANCE
CORPORATION, an insurance company organized under the laws of the State of New
York (“Berkshire”).

 

PRELIMINARY STATEMENTS

 

(1)           Oglethorpe, RMLC,
the Owner Participant, the Owner Trustee, the Co-Trustee and Utrecht-America
Finance Co., a corporation organized under the laws of the State of Delaware
(the “Lender”) are parties to a Participation Agreement (P1), dated as
of December 30, 1996 (the “Participation Agreement”; capitalized
terms used herein and not otherwise defined being used herein as defined in the
Participation Agreement).

 

(2)           On December 31,
1996, in connection with the transactions contemplated by the Participation
Agreement, AMBAC issued two surety bonds, 

 

1

 

consisting
of (a) Surety Bond (Head Lease-P1) No. SF0003BE in favor of the Head
Lessee and the Owner Participant (as amended and restated as of the date
hereof, and as hereafter from time to time amended as permitted hereby, the “AMBAC
Head Lease Surety Bond”) and (b) Surety Bond (Facility Sublease-P1) No. SF0004BE
in favor of the Facility Sublessor and the Facility Lessor (as amended and
restated as of the date hereof, and as hereafter from time to time amended as
permitted hereby, the “AMBAC Sublease Surety Bond” and, together with
the AMBAC Head Lease Surety Bond, the “AMBAC Surety Bonds”; the Head
Lessee, the Owner Participant, the Facility Lessor and (with respect to the
AMBAC Sublease Surety Bond only) the Facility Sublessor, as beneficiaries under
the AMBAC Surety Bonds, being collectively referred to herein as the “AMBAC
Beneficiaries”).  On the date of
issuance of the AMBAC Surety Bonds, AMBAC was a Qualifying Surety Bond
Provider.

 

(3)           In connection with
the issuance of the AMBAC Surety Bonds, (a) the Owner Participant, the
Owner Trustee, the Co-Trustee and AMBAC entered into the Agreement for
Assignment on Default (P1) dated as of December 30, 1996 (as amended, and
as hereafter from time to time amended as permitted hereby, the “AMBAC
Assignment Agreement”), and (b) Oglethorpe and AMBAC entered into the
Guaranty Agreement (P1) dated as of December 30, 1996 (the “AMBAC
Guaranty Agreement”) (the AMBAC Guaranty Agreement, together with the AMBAC
Surety Bonds and the AMBAC Assignment Agreement, the “AMBAC Surety Documents”).

 

(4)           Subsequent to the
date of issuance of the AMBAC Surety Bonds, AMBAC ceased to be a Qualifying
Surety Bond Provider and, as a result, Oglethorpe is required to replace the
AMBAC Head Lease Surety Bond and the AMBAC Sublease Surety Bond or provide
other credit enhancement acceptable to the Owner Participant and, in the case
of the AMBAC Sublease Surety Bond, RMLC, in their sole discretion, in each case
as required by the terms of Sections 8.5 and 8.6, respectively, of the
Participation Agreement.

 

(5)           In order to satisfy
its obligations under Sections 8.5 and 8.6 of the Participation Agreement,
Oglethorpe has proposed to cause to be delivered (a) to the Head Lessee
and the Owner Participant, a surety bond issued by Berkshire in the form of Exhibit A
attached hereto (as amended from time to time, the “Berkshire Head Lease
Surety Bond”), and (b) to the Facility Sublessor and the Facility
Lessor, a surety bond issued by Berkshire in the form of Exhibit B
attached hereto (as amended from time to time, the “Berkshire Sublease
Surety Bond” and, together with the Berkshire Head Lease Surety Bond, the “Berkshire
Surety Bonds”), in each case without releasing the AMBAC Surety Bonds.

 

(6)           As a condition to
the issuance of the Berkshire Surety Bonds, Berkshire has requested the
execution and delivery of (a) this Agreement, (b) the Berkshire
Agreement for Assignment on Default (P1) dated as of the date hereof among the
Owner Participant, the Owner Trustee, the Co-Trustee and Berkshire (the “Berkshire
Assignment Agreement” and, together with this Agreement and the Berkshire
Surety Bonds, the “Berkshire Documents”), (c) the Agreement
Regarding Surety Bonds (P1) dated as of the date hereof among Oglethorpe, RMLC
and Berkshire (the “Agreement 

 

2

 

Regarding
Surety Bonds”), and (d) the Berkshire Guaranty Agreement
(P1) dated as of the date hereof between Oglethorpe and Berkshire (the “Berkshire
Guaranty Agreement”), in each case by the parties hereto and thereto in
order to confirm, among other things, (i) Berkshire’s right to
reimbursement from Oglethorpe for any amounts that may be paid by Berkshire
under and in accordance with the terms of the Berkshire Surety Bonds, (ii) Berkshire’s
right to acquire by assignment, subject to the terms and conditions set forth
herein and in the other Berkshire Documents, the Owner Participant’s Beneficial
Interest, (iii) Berkshire’s right to be subrogated or to receive an
assignment, as provided in paragraphs 6 and 11(f) of each of the Berkshire
Surety Bonds, to the right, title and interest of the Head Lessee, the Facility
Lessor, the Ground Lessee, the Ground Sublessor and the Owner Participant (as
the case may be) in, to and under the Head Lease, the Facility Lease, the
Ground Lease, the Ground Sublease, the Rocky Mountain Agreements Assignment and
the Rocky Mountain Agreements Re-assignment or relating to or arising under the
Operative Documents (such right, title and interest, subject to any right, title
and interest that shall have been assigned to AMBAC, or to which AMBAC shall
have been subrogated, in accordance with the terms hereof and the terms of the
AMBAC Surety Bonds, being the “Subrogation Interest”), and (iv) Berkshire’s
right to be subrogated, (x) as provided in paragraphs 11(a) and 11(f) of
the Berkshire Head Lease Surety Bond, to the right, title and interest of the
Head Lessee and the Owner Participant in, to and under the AMBAC Head Lease
Surety Bond and (y) as provided in paragraphs 11(a) and 11(f) of
the Berkshire Sublease Surety Bond, to the right, title and interest of the
Facility Sublessor and the Facility Lessor in, to and under the AMBAC Sublease
Surety Bond (the “Additional Subrogation Interest”).

 

(7)           Subject to the foregoing and to the terms and conditions
set forth herein, (a) Berkshire has agreed to issue the Berkshire Surety
Bonds, (b) AMBAC has agreed to issue its amendments and restatements as of
the date hereof of the AMBAC Surety Bonds, and (c) the Owner Participant
and, in the case of Section 8.6 of the Participation Agreement, RMLC, have
agreed to accept the Berkshire Surety Bonds as additional credit enhancement
for purposes of Sections 8.5 and 8.6 of the Participation Agreement.

 

AGREEMENT

 

Section 1.               Acceptance of Berkshire Surety Bonds. 
The Owner Participant and, for purposes of Section 8.6 of the
Participation Agreement, RMLC agree that the Berkshire Surety Bonds are, as of
the date hereof, acceptable credit enhancement under clause (y) of Section 8.5
and clause (y) of Section 8.6 of the Participation Agreement.  It is further agreed that as of the date
hereof (a) the Berkshire Head Lease Surety Bond shall constitute a
Qualifying Head Lease Surety Bond and (b) the Berkshire Sublease Surety
Bond shall constitute a Qualifying Sublease Surety Bond.

 

Section 2.               Reaffirmation of AMBAC Surety Bonds. 
Effective as of the Effective Date (as defined in the Agreement
Regarding Surety Bonds), AMBAC is executing and delivering amendments and
restatements of the AMBAC Surety Bonds (a) for the benefit of the obligees
named therein and (b) in recognition of Berkshire’s subrogation and other
rights set forth or referred to herein and/or in the Berkshire Surety

 

3

 

Bonds and/or arising in
connection herewith or therewith, for the benefit of Berkshire on the terms set
forth therein.

 

Section 3.               Representations and Warranties.  (a) 
Representations and Warranties of All Parties. 
Each of the parties hereto (other than AMBAC in respect of the AMBAC
Surety Bonds) represents and warrants to the other parties that:

 

(i)            it
is duly authorized to enter into this Agreement and the transactions
contemplated hereby;

 

(ii)           each
Surety Bond Document (as defined in the Agreement Regarding Surety Bonds) to
which it is a party constitutes a legal, valid and binding obligation of it
enforceable against it in accordance with its terms, subject to bankruptcy,
insolvency and similar laws affecting creditors’ rights generally and subject
as to enforceability to general principles of equity in a proceeding at law or
in equity; and

 

(iii)          its
execution, delivery and performance of each Surety Bond Document to which it is
a party does not and will not result in a breach or violation in any material
respect of, or cause a default in any material respect under, (A) its
articles of incorporation, articles of association, by-laws or other governing
documents, or (B) any material provision of any applicable law,
regulation, or order, or any material license, decree, judgment, indenture,
contract or agreement binding upon it or its assets.

 

(b)                                 Additional
Representations and Warranties of AMBAC.  AMBAC hereby represents and warrants to the
other parties hereto as follows:

 

(i)            AMBAC
has full corporate power and authority to execute and deliver the AMBAC Surety
Bonds, and the AMBAC Surety Bonds have been duly authorized, executed and
delivered by AMBAC, and constitute legal, valid and binding obligations of
AMBAC enforceable in accordance with their respective terms except to the
extent that the enforceability (but not the validity) of such obligations may
be limited by any applicable bankruptcy, insolvency, liquidation,
rehabilitation or other similar law or enactment now or hereafter enacted
affecting the enforcement of creditors’ rights; and

 

(ii)           the
execution and delivery by AMBAC of the AMBAC Surety Bonds will not, and the
satisfaction of the terms thereof will not, conflict with or result in a
breach, in any material respect, of any of the terms, conditions or provisions
of the Restated Articles of Incorporation or Restated Corporate By-Laws of
AMBAC, or any restriction contained in any contract, agreement or instrument to
which AMBAC is a party or by which it is bound or constitute a default, in any
material respect, under any of the foregoing.

 

4

 

Section 4.               Agreements Regarding Operative Documents. 
Effective as of the Effective Date:

 

(a)                                  From and after
the date hereof until the Berkshire Termination Date (as defined below), and so
long as Berkshire is not in default in any material respect in the performance
of its obligations under the Berkshire Surety Bonds:

 

(i)            AMBAC
shall not, without the prior written consent of Berkshire (which consent shall
not be unreasonably withheld), supplement, modify or amend, or grant, provide
or enter into any waiver, release or compromise (each, a “Modification”)
under or in respect of any of the Operative Documents, to the extent that such
action has or would reasonably be expected to have a material adverse effect on
the rights and interests of Berkshire under the Berkshire Documents or the
Operative Documents or the value of the Beneficial Interest or any part
thereof, provided, however, that forbearance by AMBAC on a
discretionary basis from exercising any right or remedy shall not require such
consent; and provided, further,
that nothing in this Section 4(a)(i) shall be construed to prevent
AMBAC from consenting to (x) any waiver (whether or not such consent is
required) of Oglethorpe’s obligations to replace the Berkshire Surety Bonds
pursuant to Sections 8.5 and 8.6 of the Participation Agreement or (y) any
replacement of the Berkshire Surety Bonds pursuant to Sections 8.5 and 8.6 or
8.5-1 and 8.6-1 of the Participation Agreement and so long as AMBAC is not in
default in the payment of any amount owing under or in respect of the AMBAC
Surety Bonds or the other AMBAC Surety Documents, Berkshire shall not, without
the prior written consent of AMBAC (which consent shall not be unreasonably
withheld), enter into any written Modification under or in respect of the
Berkshire Documents, to the extent that such action has or would reasonably be
expected to have a material adverse effect on the rights and interests of AMBAC
under the AMBAC Surety Documents, provided, however, that the
exercise by Berkshire or forbearance by Berkshire on a discretionary basis from
exercising any rights or remedies under the Berkshire Documents shall not
require such consent;

 

(ii)           If
Berkshire is not in default on any of its payment obligations under the
Berkshire Documents at the time of any Modification under or in respect of any
of the Operative Documents, such Modification shall be void and ineffective
unless (i) Berkshire shall have consented to such Modification in writing
or (ii) such Modification is permitted to be made without Berkshire’s
prior consent pursuant to Sections 4(a)(i), (iii) and (iv) of this
Agreement;

 

(iii)          Each
of Oglethorpe and RMLC agrees that, from and after the date hereof and until
the Berkshire Termination Date, it will not, without the prior written consent
of Berkshire, supplement, modify or amend any of the Operative Documents,
consent to any departure by any other party from its obligations under any of
the Operative Documents, waive or release any rights or interests under any of
the Operative Documents, grant any other approval, consent or waiver under the
Operative Documents or enter into any other agreement with

 

5

 

respect thereto or in connection therewith, or, to the extent that it
has any right to object, accept or acquiesce in any such approval, consent,
waiver or other agreement from or by any other party to the Operative
Documents, in each case if such action has or would be reasonably expected to
have a material adverse effect on the rights and interests of Berkshire under
the Berkshire Documents or the value of the Beneficial Interest or the
Subrogation Interest or any claims relating to or arising from any loss or
impairment of the Beneficial Interest or the Subrogation Interest or, in the
case of Oglethorpe, the Guaranty Agreement, including, without limitation, any
such claims under the terms of the Head Lease and any remedies under Section 11.2(a) thereof;
provided, however, that nothing in this Section 4(a)(iii) shall
be construed to prevent Oglethorpe from requesting or agreeing to any waiver of
its obligations to replace the Berkshire Surety Bonds (or prevent RMLC from
consenting thereto) or from replacing the Berkshire Surety Bonds pursuant to Section 8.5
and 8.6 of the Participation Agreement or Oglethorpe or RMLC from taking action
to the extent necessary to comply with any of its obligations under the
Operative Documents; and

 

(iv)          AMBAC
shall not, without the prior written consent of Berkshire, supplement, modify
or amend, or grant, provide or enter into or accept any waiver, release,
compromise, approval, consent or other agreement under or in respect of, any of
the AMBAC Surety Bonds or the AMBAC Assignment Agreement, to the extent that
such action has or would reasonably be expected to have a material adverse
effect on the rights and interest of Berkshire with respect thereto.

 

(b)                                 (A) Each
of RMLC and Oglethorpe agrees that, regardless whether RMLC’s or Oglethorpe’s
obligations shall have been discharged under the terms of the Operative
Documents, it shall be, or shall continue to be, unconditionally obligated to
Berkshire or its designee (to the extent such person is subrogated to, or
acquires, the Beneficial Interest pursuant to the Berkshire Assignment
Agreement or the Subrogation Interest under either of the Surety Bonds) to
perform and discharge, without duplication, (1) any and all of its
obligations with respect to which any payment under any Berkshire Surety Bond
or AMBAC Surety Bond is made or against which the proceeds thereof are applied,
in each case to the same extent as though no payment had been made under any
Berkshire Surety Bond or AMBAC Surety Bond, and (2) any and all of its
other obligations that have not been performed by it or on its behalf (other
than any such performance by Berkshire or AMBAC) and are or otherwise would be
owing to the holder of the Beneficial Interest or the Subrogation Interest, as
the case may be, and (B) Oglethorpe agrees that, without limitation on the
foregoing, if (1) a payment has been made by Berkshire under either of the
Berkshire Surety Bonds and Berkshire has not been reimbursed by Oglethorpe for
the full amount thereof pursuant to the Berkshire Guaranty Agreement or (2) AMBAC
has not paid the full amount of a conforming demand for payment under the AMBAC
Surety Bonds, Oglethorpe shall, unless expressly waived in writing by
Berkshire, immediately provide a new Qualifying Head Lease Surety Bond,
Qualifying Letter of Credit or other credit enhancement as required by and in
accordance with Section 8.5 of the Participation Agreement and a new
Qualifying Sublease Surety Bond, Qualifying Letter of Credit or other credit
enhancement as required by and in accordance with Section 8.6 of the
Participation

 

6

 

Agreement (it being agreed that any failure
to comply with the provisions of this clause (B) shall constitute a Head
Lessor Event of Default in the case of Section 8.5 and a Sublease Event of
Default in the case of Section 8.6). 
The agreements of RMLC in this Section 4(b) shall be deemed to
be incorporated into the covenants of RMLC in the Facility Lease and the
agreements of Oglethorpe in this Section 4(b) shall be deemed to be
incorporated into the covenants of Oglethorpe in the Head Lease or the Facility
Sublease, as applicable.

 

(c)           In the event that Berkshire or its designee shall acquire,
or shall be committed to acquire, as contemplated by the Berkshire Documents,
the Owner Participant’s Beneficial Interest and/or the Subrogation Interest or
any part thereof and at the time of such acquisition or at the time when
Berkshire or any designee of Berkshire shall have acquired or become committed
to acquire such interest a Sublease Event of Default or a Head Lessor Event of
Default shall have occurred and be continuing, Oglethorpe shall, unless
expressly waived in writing by Berkshire, automatically be obligated, within
ten Business Days thereafter or, if later, the date Berkshire acquires the
Owner Participant’s Beneficial Interest pursuant to the Berkshire Assignment
Agreement or the Subrogation Interest under either of the Surety Bonds, to, at
its option, either (A) cause the Lien of the Oglethorpe Mortgage to be
released or modified, in each case in a manner acceptable to Berkshire, such
that (1) the Lien thereof no longer attaches to or affects the Facility,
the Rocky Mountain Site, the Undivided Interest or any other rights or
interests of the Head Lessee or the Ground Lessee under the Head Lease or the
Ground Lease, and (2) any foreclosure or other action in respect thereof
will not disturb the possession of the Head Lessee, the Ground Lessee or their
respective successors, assigns and lessees in and to the Facility, the Rocky
Mountain Site and the Undivided Interest, and otherwise terminate and remove
all other Liens (other than Permitted Liens of the type described in clauses (i) and
(iii)-(xii) of the definition thereof) affecting the Facility, the Rocky
Mountain Site and/or the Undivided Interest, or (B) to the extent that
such interests have been transferred to Berkshire, purchase, as the case may
be, the Owner Participant’s Beneficial Interest from Berkshire or the
Subrogation Interest from Berkshire, as applicable, pursuant to documentation
reasonably acceptable to Berkshire, for an amount equal to the Estimated Market
Value of the Leasehold Interest (as defined below) minus the sum of (x) the
then unpaid principal balance of the Loan, (y) the amount of any
indefeasible payment made at or prior to such time for the account of the Owner
Participant or the Owner Trustee under the AIG Equity Funding Agreement or any
other Qualifying Equity Funding Agreement or any replacement thereof or any
Qualifying Additional Security (in each case, whether or not “qualifying”), and
(z) without duplication of the amount described in clause (x) above,
the amount of any indefeasible prepayment of the principal of the Loan made at
or prior to such time pursuant to the Payment Undertaking Agreement. Upon the
consummation of any purchase by Oglethorpe contemplated in clause (B) of
the next preceding sentence (including indefeasible payment of the purchase
price to Berkshire), Berkshire shall assign to Oglethorpe, without recourse and
without representations or warranties of any kind, express, implied or
otherwise, all of Berkshire’s claims against Oglethorpe under the Operative
Documents and the Berkshire Documents (other than indemnification claims).
Without limiting Oglethorpe’s indemnification obligations under Sections 11.1
and 11.2 of the Participation Agreement, Oglethorpe shall pay or reimburse
Berkshire

 

7

 

and the other parties for any and all costs
and expenses (including reasonable legal fees and expenses, all interest
charges on amounts payable under the Operative Documents (including late
payment of default interest), all filing and other procedural charges and fees
of financial and technical professionals) incurred by Berkshire and the other
parties in connection with the exercise by Oglethorpe of the purchase option
under clause (B) above, as well as any taxes payable in connection with
such purchase.

 

For
purpose of this Section 4(c), “Estimated Market Value of the Leasehold
Interest” shall be equal to $462,399,033.60, which is the Facility Lessor’s
pro rata portion of $1.1 billion, or approximately equal to 101.22% of the
Purchase Option Price under Section 15.1 of the Facility Sublease.  The Purchase Option Price was based on the
estimated market value of the Leasehold Interest at the end of the Facility
Sublease Term as determined pursuant to an appraisal conducted by Deloitte &
Touche, LLP Valuation Group prior to the Closing Date on behalf of the Owner
Participant.  Although the appraisal is
confidential and neither Berkshire nor Oglethorpe have reviewed the appraisal
or the underlying assumptions in the appraisal, they have agreed to base the
Estimated Market Value of the Leasehold Interest on the Purchase Option Price
since (i) the appraisal was performed by an independent third party with
extensive experience in appraising electric generating facilities; (ii) the
Purchase Option Price appears to Oglethorpe and Berkshire to be generally
consistent with the results of Oglethorpe’s internal study, described below,
and could reasonably be expected to represent, or be in the range of, the
future market value of the Leasehold Interest under valuation assumptions
similar to those used in Oglethorpe’s internal study referred to below; (iii) the
procurement of a new appraisal from an independent appraiser would be
inconsistent with the commercial objectives of the parties; and (iv) the
Facility is unique in several material respects, and, in the absence of sales
of comparable facilities, the range of potential valuations in the future is so
broad as to create an unacceptable level of commercial uncertainty for the
parties. In agreeing upon a liquidation of the Estimated Market Value of the
Leasehold Interest, the parties have taken into account the results of an
internal study performed by Oglethorpe in 2008, which provided an estimate for
Oglethorpe’s interest in the Facility equal to $1.03 billion at that time.  Both Oglethorpe and Berkshire agree that (i) the
determination of Estimated Market Value of the Leasehold Interest as specified
above is reasonable, the Estimated Market Value of the Leasehold Interest set
forth in the first sentence of this paragraph shall be binding and such
Estimated Market Value shall apply regardless of any different number in use
for any other purpose by Oglethorpe or Berkshire and (ii) neither shall
have the right to seek an appraisal of the Leasehold Interest under this Section 4(c).  Oglethorpe hereby represents to Berkshire
that (1) in 2008 Oglethorpe’s estimate of market value of its entire
interest in the Facility was $1.03 billion, (2) such estimate was
determined in the ordinary course, in connection with an internal valuation of
all of its generating facilities, and not in anticipation of or in connection
with the transactions contemplated pursuant to the Agreement Regarding Surety
Bonds, (3) such estimate was performed using a discounted cash flow
approach and assumptions that Oglethorpe believed, at the time of such
determination, to be reasonable, (4) Oglethorpe believes that its estimate
of market value continues to be within the range of values which could be
deemed to be market for Oglethorpe’s interest in the Facility as of the
Berkshire Surety Bond Date, and (5) as of

 

8

 

the
Berkshire Surety Bond Date, Oglethorpe has not updated such estimate and
continues to utilize such estimate internally for the purposes for which it was
originally generated.

 

Section 5.               Agreements Regarding Subrogation Rights, Etc. 
Anything contained in the AMBAC Surety Documents to the contrary
notwithstanding:

 

(a)                                  Each of
Oglethorpe, RMLC, the Owner Participant, the Owner Trustee, the Co-Trustee and
AMBAC acknowledges and agrees that in the event that a demand for payment is
made under either of the Berkshire Surety Bonds and Berkshire pays the amount
required by such demand in full (the payment by Berkshire in full of the amount
required by such a demand being referred to as a “Berkshire Surety Payment”)
(i) Berkshire shall immediately be fully subrogated to all rights of each
of the respective AMBAC Beneficiaries in respect of AMBAC’s obligations with
respect to such Berkshire Surety Payment, including any related Claimed Amount
(as defined in the AMBAC Surety Bonds) that is unpaid under the AMBAC Surety
Bonds, and the AMBAC Beneficiaries shall have no further obligation to AMBAC
under the AMBAC Surety Bonds with respect to such Berkshire Surety Payment, (ii) Berkshire
shall be entitled to exercise any and all rights and to enforce any and all
remedies which any such AMBAC Beneficiary now has or may hereafter have against
AMBAC with respect to such Berkshire Surety Payment, and (iii) Berkshire
shall have, except as specified in the penultimate sentence of paragraph 11(f)(ii) of
the Berkshire Surety Bonds, the sole and exclusive benefit of, and the sole and
exclusive right to participate in, any claims or recoveries against AMBAC with
respect to such Berkshire Surety Payment, in each case under clauses (i), (ii) and
(iii) for its own benefit and to the exclusion of each of the AMBAC
Beneficiaries or any other Person, and without any duty to account therefor to
any other Person and (iv) each of the AMBAC Beneficiaries shall, upon
request by and at the expense of Berkshire, execute and deliver to Berkshire or
its designee such assignments and other agreements, in form and substance
reasonably satisfactory to Berkshire, as Berkshire may reasonably require to
evidence the transfer and assignment to Berkshire of all such rights and
interests of each such AMBAC Beneficiary in, to and under the AMBAC Surety
Bonds with respect to such Berkshire Surety Payment.  Notwithstanding anything in the next
preceding sentence to the contrary, in the event that, following any
subrogation, transfer and assignment contemplated in such sentence, any payment
with respect to a Covered Obligation (as defined in the Berkshire Head Lease
Surety Bond or the Berkshire Sublease Surety Bond) shall become an Oglethorpe
Avoided Payment, the AMBAC Beneficiaries shall retain all rights to draw under
the AMBAC Surety Bonds with respect to such Oglethorpe Avoided Payment as are
provided under such bonds and retain the proceeds of such drawing, provided,
however, that in the event that AMBAC shall not honor such drawing and a
drawing under the Berkshire Surety Bonds with respect to such Oglethorpe
Avoided Payment shall be honored, Berkshire shall be subrogated and shall be
entitled to transfer and assignment as specified in the next preceding sentence
with respect to the rights of each such AMBAC Beneficiary under the AMBAC
Surety Bonds with respect to such Oglethorpe Avoided Payment.

 

(b)                                 AMBAC agrees
that if a conforming demand for payment is made under either of the Berkshire
Surety Bonds and Berkshire makes a Berkshire Surety Payment of

 

9

 

the amount demanded thereunder, AMBAC shall
thereupon pay to Berkshire from time to time all amounts then due or to become
due under either or both of the AMBAC Surety Bonds with respect to such
Berkshire Surety Payment, in each case in accordance with their respective
terms, and the AMBAC Beneficiaries acknowledge and agree to such payments by
AMBAC, subject to the provisions of Section 5(a) hereof.  AMBAC further agrees that the obligation of
AMBAC to make any payments to Berkshire or its designee as subrogee, assignee
or transferee of the AMBAC Beneficiaries under the AMBAC Surety Bonds, whether
under this Section 5(b) or otherwise, shall be absolute, irrevocable
and unconditional and not subject to any setoff, counterclaim or defense or any
other requirement of any kind or nature, as and to the extent specified in the
AMBAC Surety Bonds, each of which waivers of setoff, counterclaim and defense
is hereby reaffirmed for the express benefit of Berkshire.  Upon subrogation of Berkshire pursuant to Section 5(a) hereof,
the AMBAC Beneficiaries shall cease to have any claim against AMBAC under the
AMBAC Surety Bonds for such Berkshire Surety Payment.

 

(c)           AMBAC irrevocably, absolutely and unconditionally waives
all rights of reimbursement, contribution and subrogation against Berkshire,
whether otherwise existing under or by virtue of any of the Berkshire Documents
or any payments or other actions thereunder or by applicable law or otherwise.  Nothing in this Section 5(c) shall
be construed to prevent AMBAC from bringing a separate action against Berkshire
for any breach by Berkshire of its obligations to AMBAC, if any, under any of
the Berkshire Documents.

 

(d)           Each of the parties hereto (i) consents to, agrees to
recognize and will not interfere with, or cause, request or require any other
party to interfere with, any rights of subrogation, contribution, purchase or
reimbursement in favor of Berkshire set forth in the Berkshire Documents or (to
the extent not expressly limited by the Berkshire Documents) applicable law (it
being understood that any such subrogation rights shall include, without
limitation, the right to enforce any obligations of Oglethorpe that have not
been performed by Oglethorpe with respect to which any payment under any
Berkshire Surety Bond is made or against which the proceeds thereof are
otherwise applied, to the same extent as though no payment had been made under
any Berkshire Surety Bond, so long as Berkshire has not been reimbursed by
Oglethorpe pursuant to the Berkshire Guaranty Agreement and/or AMBAC has not
paid, in installments or (at AMBAC’s sole option) on an accelerated basis,
under the AMBAC Surety Bonds, the full amount of all Berkshire Obligations (as
defined below); provided, however, that causing, requesting or
requiring any party hereto to perform its obligations hereunder or under any
other Operative Document shall not constitute such interference, and (ii) upon
the exercise of any such rights by Berkshire, agrees to recognize Berkshire as
subrogee, purchaser or assignee, as the case may be.  Nothing in this paragraph 5(d) shall be
construed to be a representation on the part of the Owner Participant or Head
Lessee as to the existence or extent of the right, title, interest and remedies
to which Berkshire shall be subrogated pursuant to this Section 5 or
applicable law, except that the Owner Participant and the Head Lessee shall be
deemed to represent, severally as to itself, that it has not assigned such
right, title, interest or remedies (other than, in the case of the Head Lessee,
any grant to the Lender of a security interest in any such right, title,
interest or remedies or any interest therein or other rights relating thereto
under and as provided by the Loan

 

10

 

Agreement, and other than any assignment or
grant of subrogation rights required under the terms of the AMBAC Surety
Documents) and, in the case of the Owner Participant, that no Owner Participant’s
Lien or, in the case of the Head Lessee, that no Facility Lessor’s Lien exists
thereon.  Upon payment of any demand for
payment under the Berkshire Surety Bonds, Berkshire shall have no liability or
duty to AMBAC, or to account to AMBAC, for the exercise of any rights and
remedies, or failure to exercise any rights or remedies, or any other action
taken by it or failure to act under the Berkshire Documents, the Berkshire
Guaranty Agreement, the Operative Documents or applicable law or the effect of
any such action; provided, however, that if AMBAC shall have made
any payment under the AMBAC Surety Bonds that shall have not been reimbursed
but shall have not made full payment of all amounts due under the AMBAC Surety
Bonds, Berkshire shall, upon request by and at the expense of AMBAC, do either
of the following (at the election of Berkshire): (1) turn over to AMBAC
any excess of funds received by Berkshire to which Berkshire shall be entitled
from the exercise of any remedies or other actions that result in the realization
of proceeds of the Beneficial Interest or the Subrogation Interest (including
any sale of the interest under Section 4(c)(B) hereof to Oglethorpe
or its designee) over the full amount of the Berkshire Obligations, to the
extent of such unreimbursed payments due to AMBAC plus any other amounts due to
AMBAC under the AMBAC Guaranty Agreement, subject to such indemnities and other
conditions as Berkshire may require, and without recourse and without
representations or warranties of any kind, express, implied or otherwise, or (2) interplead
such excess amount (or, if less, the amount claimed by AMBAC) with a court of
competent jurisdiction in an action against AMBAC, Oglethorpe and such other
parties as Berkshire may determine in its sole discretion.

 

(e)           Unless and until the occurrence of the latest of (i) the
date on which the Berkshire Surety Bonds are terminated, (ii) the full and
final release of Berkshire from further liability under the Berkshire Documents
by the other parties thereto, and (iii) indefeasible payment to Berkshire
of all Berkshire Obligations (the latest of such dates being the “Berkshire
Termination Date”), in the event that any conforming demand for payment
shall be presented and paid in full under any of the Berkshire Surety Bonds, (A) AMBAC
shall not be entitled to consummate any right of subrogation or purchase under
the AMBAC Surety Bonds or under any other Operative Documents (any and all such
rights being (except as specified in the second paragraph of Section 5(g) hereof)
exercisable, if at all, solely by Berkshire as subrogee or purchaser for its
sole benefit), (B) any and all rights of AMBAC of subrogation or purchase
under the AMBAC Surety Documents or under any other Operative Documents, and
any and all security provided for the benefit of AMBAC under the Operative
Documents, shall be subject and subordinate in all respects to the rights of
Berkshire under the Berkshire Documents and the Berkshire Guaranty Agreement
and any such security provided under the Operative Documents, and, to the
extent that the exercise of such rights by Berkshire (and performance by the
Head Lessee, the Facility Lessor and the Owner Participant in favor of
Berkshire) may impair or render ineffective any security provided for the
benefit of AMBAC or any right of reimbursement of AMBAC under the AMBAC Surety
Documents, AMBAC hereby consents to such impairment and/or ineffectiveness and
waives any and all claims resulting therefrom, and (C) as between AMBAC
and Berkshire, Berkshire shall be entitled to exercise any rights with respect
to such security

 

11

 

and shall be entitled to receive, hold and
apply any proceeds thereof to the exclusion of AMBAC, and AMBAC shall not be
entitled to exercise such rights or to receive, hold and/or apply any such
proceeds until the Berkshire Obligations have been satisfied in full.

 

In furtherance of the
foregoing, AMBAC hereby subordinates any and all claims for amounts owed to
AMBAC under the AMBAC Surety Documents (the “AMBAC Obligations”) to any and all
claims for amounts (including Post Petition Interest (as defined
below)) owed from time to time to Berkshire under the Berkshire Documents
and/or the Berkshire Guaranty Agreement (the “Berkshire Obligations”) to
the extent and in the manner hereinafter set forth in the following clauses
(A)-(D):

 

(A)          Except
as set forth in the next succeeding paragraph, unless Berkshire otherwise
agrees, AMBAC shall not demand, accept or take any action to collect any
payment on account of the AMBAC Obligations other than, subject to clause (C) below,
under the AMBAC Guaranty Agreement;

 

(B)           In
any proceeding under the Bankruptcy Code or any similar law (collectively, “Bankruptcy
Law”) relating to Oglethorpe, AMBAC agrees that, after payment by Berkshire
of a demand for payment under the Berkshire Surety Bonds, Berkshire shall be
entitled to receive payment in full in cash of all Berkshire Obligations
(including all interest and expenses accruing after the commencement of a
proceeding under any Bankruptcy Law, whether or not constituting an allowed
claim in such proceeding (“Post Petition Interest”)) before AMBAC
receives payment of any AMBAC Obligations;

 

(C)           After
payment by Berkshire of a demand for payment under the Berkshire Surety Bonds,
if AMBAC shall receive any payments on account of the AMBAC Obligations
(including, for the avoidance of doubt, under the AMBAC Guaranty Agreement),
AMBAC shall receive such payments as trustee for Berkshire and deliver such
payments to Berkshire on account of the Berkshire Obligations (including all
Post Petition Interest), together with any necessary endorsements or other
instruments of transfer; and

 

(D)          After
any payment by Berkshire of a demand for payment under the Berkshire Surety
Bonds, if AMBAC shall collect any amounts with respect to the AMBAC
Obligations, it shall receive such amounts in trust for Berkshire and
immediately pay such amounts over to Berkshire until all outstanding Berkshire
Obligations shall have been paid in full.

 

In
the event that (i) one or more demands for payment shall have been made
under the AMBAC Surety Bonds and AMBAC shall have timely honored all such
demands so that no demand for payment shall have been made under either of the
Berkshire Surety Bonds, and provided that (x) AMBAC shall not be in
default on its obligations to Berkshire under this Agreement or under either of
the AMBAC Surety

 

12

 

Bonds
and (y) no event shall have occurred and be continuing that would prevent
or would reasonably be expected to prevent AMBAC from making payment of any
amount required to be paid by AMBAC under the AMBAC Surety Bonds when due
thereunder, or under any other surety bond implementation agreement or surety
bonds issued in connection with the Facility, then, notwithstanding the next
preceding paragraph, AMBAC may exercise all available rights under the
Operative Documents and applicable law for the purpose of claiming
reimbursement from Oglethorpe for amounts paid under either of the AMBAC Surety
Bonds and for purposes of recovering such amount from any collateral available
to AMBAC or through the exercise of any rights to which AMBAC has been
subrogated.

 

(f)            If at any time Oglethorpe shall provide or be required to
provide any Qualifying Additional Security or other additional collateral in
the nature of a letter of credit, guaranty or surety bond (or other collateral
that may provide subrogation rights to any Person) for its obligations under
the Operative Documents, Oglethorpe agrees that, unless each of Berkshire and
AMBAC consents thereto (or shall have been released from liability under the
Berkshire Surety Bonds or AMBAC Surety Bonds, as applicable, and shall have
received payment in full of all amounts with respect thereto), it will ensure
that (i) the issuer or provider of such Qualifying Additional Security or
other collateral waives and agrees that it will not exercise any subrogation
rights with respect thereto without the prior written consent of such Surety
Bond Provider, and (ii) without limitation of any other rights of such
Surety Bond Provider, such Qualifying Additional Security shall be issued on
terms such that it shall be practicable for such Surety Bond Provider to
benefit therefrom as part of the right, title and interest that such Surety
Bond Provider shall acquire in the event that such Surety Bond Provider shall
have acquired the Beneficial Interest or the Subrogation Interest in accordance
with the terms of the Berkshire Documents or AMBAC Surety Documents, as
applicable.

 

(g)           The rules specified in this Section 5(g) are
subject to the provisions of Section 5(e). 
In the event that Berkshire shall give notice of exercise of its
purchase option under the Berkshire Assignment Agreement, Berkshire shall give
prompt notice of such exercise to AMBAC, whereupon AMBAC shall have no further
right to exercise its right under the AMBAC Assignment Agreement if Berkshire
shall not be in default on its obligation to pay the purchase price under the
Berkshire Assignment Agreement when due. 
In the event that AMBAC shall give notice of exercise of its purchase
option under the AMBAC Assignment Agreement, AMBAC shall give prompt notice of
such exercise to Berkshire, whereupon Berkshire shall have no further right to
exercise its right under the Berkshire Assignment Agreement if AMBAC shall not
be in default of its obligation to pay the purchase price under the AMBAC
Assignment Agreement when due.  In the
event that Berkshire shall give notice of exercise of its purchase option under
the Berkshire Assignment Agreement in accordance with the terms thereof and
hereof and AMBAC shall give notice of exercise of its purchase option under the
AMBAC Assignment Agreement in accordance with the terms thereof and hereof,
then in each case such notice of exercise shall be ineffective if the Purchase
Option Election (as defined in the Berkshire Assignment Agreement or the AMBAC
Assignment Agreement) relating to such exercise by such party shall be received
by the Owner Participant after the Owner Participant shall have received the
Purchase Option Election relating to such

 

13

 

exercise by the other party.  If the Purchase Option Election (as defined
in the Berkshire Assignment Agreement) and the Purchase Option Election (as
defined in the AMBAC Assignment Agreement) are received or deemed received
simultaneously, the Purchase Option Election (as defined in the Berkshire
Assignment Agreement) shall be ineffective.

 

Notwithstanding
any provision to the contrary of the Berkshire Assignment Agreement or the
AMBAC Assignment Agreement, if a conforming demand for payment has been made
under the AMBAC Surety Bonds and AMBAC is not in default thereunder, Berkshire
shall not (so long as no such default has occurred and shall be continuing)
give notice that it is exercising or exercise its purchase option under the
Berkshire Assignment Agreement, (ii) if a conforming demand for payment
has been made under the AMBAC Surety Bonds that has not been paid by AMBAC and
no demand for payment shall have been made under the Berkshire Surety Bonds,
AMBAC may, in accordance with the terms of the AMBAC Assignment Agreement, give
notice that it is exercising and exercise its purchase option thereunder (but
any such exercise shall be subject to the rules in the preceding
paragraph) and (iii) if a conforming demand for payment has been made
under the Berkshire Surety Bonds and Berkshire shall not have been indefeasibly
paid or reimbursed the full amount of all Berkshire Obligations, AMBAC shall
not (until such circumstances shall no longer exist) exercise its purchase
option under the AMBAC Assignment Agreement, and any attempt by AMBAC to
exercise such purchase option in such circumstances shall be void, ineffective
and deemed withdrawn.  In addition, so
long as AMBAC is not in default under the AMBAC Surety Bonds, if a Trigger
Event (as defined in the Berkshire Assignment Agreement) (other than a Trigger
Event described in clause (d) of the definition of that term) shall have
occurred, Berkshire agrees that it shall not give notice of its exercise of its
purchase option thereunder until the expiration of at least 21 days after the
date of the occurrence of such Trigger Event or, if earlier, the date on which
the provisions of this sentence are waived in writing by AMBAC.

 

In
the event that (A) either (i) Berkshire shall have acquired the
Beneficial Interest pursuant to the Berkshire Assignment Agreement and shall
have paid the purchase price thereunder or (ii) Berkshire shall have
acquired the Subrogation Interest under either of the Surety Bonds in
consideration of Payment in Full (as defined therein), and (B) AMBAC shall
have made one or more payments under the AMBAC Surety Bonds, then, if Berkshire
shall subsequently dispose of the Beneficial Interest or the Subrogation
Interest (including pursuant to Section 4(c) hereof) for an amount in
excess of Unpaid Amount (as defined below), Berkshire shall, upon request by
and at the expense of AMBAC, do either of the following (at the election of
Berkshire): (1) pay to AMBAC an amount equal to the lesser of the amount
of such excess to which Berkshire shall be entitled and the amount then owing
to AMBAC under the AMBAC Surety Bonds or the AMBAC Guaranty Agreement (as
certified by AMBAC), subject to such indemnities and other conditions as
Berkshire may require, and without recourse and without representations or
warranties of any kind, express, implied or otherwise, or (2) interplead
such excess amount (or, if less, the amount claimed by AMBAC) with a court of
competent jurisdiction in an action against AMBAC, Oglethorpe and such other
parties as Berkshire may determine in its sole discretion.

 

14

 

In
the event that (A) Berkshire shall have acquired the Beneficial Interest
pursuant to the Berkshire Assignment Agreement and shall have paid the purchase
price thereunder, or (B) Berkshire shall have acquired the Subrogation
Interest under either of the Surety Bonds in consideration of Payment in Full
(as defined therein), and AMBAC shall thereafter pay to Berkshire an amount
equal to the Unpaid Amount, Berkshire shall, upon request by and at the expense
of AMBAC, do either of the following (at the election of Berkshire): (1) assign
to AMBAC all right, title and interest, if any, then held by Berkshire in the
Beneficial Interest or such rights, as the case may be, without recourse and
without representations or warranties of any kind, express, implied or otherwise,
or (2) disclaim any remaining interest in the Subrogation Interest or the
Beneficial Interest, as the case may be, and interplead such interest with a
court of competent jurisdiction in an action against AMBAC, Oglethorpe and such
other parties as Berkshire may determine in its sole discretion.

 

As
used herein, the term “Unpaid Amount” means (1) the sum of (a) the
purchase price and all other amounts paid by Berkshire in connection with its
acquisition of the Beneficial Interest or the Subrogation Interest, as the case
may be, (b) all other amounts owing to Berkshire under the Operative
Documents, the Surety Bond Documents, the Berkshire Assignment Agreement and
the Berkshire Guaranty Agreement, (c) all other amounts paid or incurred
by Berkshire in connection with such acquisition and/or the exercise of rights
and remedies under such documents and/or to liquidate or otherwise realize on
the Beneficial Interest, the Subrogation Interest or any part thereof or to
recover any amounts paid or incurred by or owing to it, including reasonable
attorneys’ fees and disbursements of counsel, and (d) interest accrued on
all such amounts at the Overdue Rate from the date paid or incurred, minus (2) any
amounts theretofore indefeasibly paid to or received by Berkshire in respect of
the foregoing, including amounts paid by AMBAC to Berkshire under either of the
AMBAC Surety Bonds.

 

In
the event that the Owner Participant shall receive a notice of election of
purchase option from AMBAC under the AMBAC Assignment Agreement or from
Berkshire under the Berkshire Assignment Agreement and within three Business
Days after the Owner Participant shall have received such notice the
non-exercising Surety Bond Provider shall not deliver to the Owner Participant
a notice stating in substance that the relevant notice of exercise is not
consistent with the arrangements between such Surety Bond Providers specified
in this Agreement, it shall be conclusively presumed that such notice of
exercise is so consistent and the Owner Participants may rely thereon without
further investigation.  In the event that
the non-exercising Surety Bond Provider shall deliver to it such a notice, then
the Owner Participant may without liability suspend performance of its
obligations under the AMBAC Assignment Agreement or the Berkshire Assignment
Agreement, as the case may be, unless and until it shall have received evidence
reasonably satisfactory to it (an order of a competent court shall be deemed
satisfactory) that the relevant notice of exercise is so consistent or that it
is not objected to by AMBAC or Berkshire, as the case may be; and any period
with respect to the performance of obligations by all parties in consequence of
the giving of such notice of exercise under the AMBAC Assignment Agreement or
the Berkshire Assignment Agreement, as the case may be, shall be tolled during
the period of such suspension.  Each of
AMBAC, Berkshire and the Owner Participant shall, in giving any notice

 

15

 

pursuant
to this paragraph to any person, provide to whichever among AMBAC, Berkshire
and the Owner Participant is neither the addressee nor the giver of such notice
a copy of such notice substantially simultaneously with the giving thereof to
the addressee thereof.

 

(h)           If (i) the Owner Participant receives written notice
that any motion or other proceeding has been instituted in any Insolvency
Proceeding (as defined below) that claims or alleges that any payment that is
an Excepted Payment that was made to the Owner Participant or the Head Lessee
by or for the account of Oglethorpe under any Operative Document or by or for
the account of AMBAC under any AMBAC Surety Document is avoided or should be
avoided or that avoidance of any such payment has or should be deemed to have
occurred or that any other event has occurred that would constitute an
Avoidance Event as defined in either of the Berkshire Surety Bonds, and (ii) the
Owner Participant, the Owner Trustee or the Co-Trustee shall have appeared in
or shall be a party to such Insolvency Proceeding or to such motion or other
proceeding, the Owner Participant shall use its good faith efforts to give
notice thereof to Berkshire (and without liability for any failure to provide
such notice unless the Owner Participant was not acting in good faith) and
shall not object to any motion or other action by Berkshire to intervene or to
participate in such motion or other proceeding at Berkshire’s own expense to
contest such claim or allegation.  “Insolvency Proceeding” means the
commencement, after the date hereof, of any bankruptcy, insolvency,
readjustment of debt, reorganization, marshalling of assets and liabilities or
similar proceedings by or against any person, or the commencement, after the
date hereof, of any proceedings by or against any person for the winding up or
the liquidation of its affairs, or the consent after the date hereof to the
appointment of a trustee, conservator, receiver or liquidator in any
bankruptcy, insolvency, readjustment of debt, reorganization, marshalling of
assets and liabilities or proceedings similar to the foregoing relating to any
person.

 

(i)            Without limitation of the provisions of paragraph (a) of
this Section 5, in the event that any payment by Berkshire pursuant to
either of the Berkshire Surety Bonds shall be based upon an improper or
incorrect determination by any of the beneficiaries thereof that there shall
have existed a basis for the delivery of any demand for payment thereunder,
Berkshire shall (to the extent not repaid) be deemed to have received an
assignment from Oglethorpe of such right, if any, as Oglethorpe may have to
recover an amount corresponding to such payment or any portion thereof; provided,
however, that Berkshire shall have no right to recover any such amounts
under the AMBAC Surety Bonds except to the extent that the amount thereof is
otherwise payable thereunder.

 

(j)            In the event that Berkshire shall give a Notice of
Termination pursuant to paragraph 5 of either of the Surety Bonds, it shall
promptly give notice to AMBAC and Oglethorpe thereof.  Berkshire shall not enter into any amendment
of the provisions of clause (vii) of paragraph 5 of either of the Surety
Bonds pertaining to the delivery of Notices of Termination thereunder except
with the written consent of AMBAC, provided that AMBAC shall not be in breach
of its obligations under the AMBAC Surety Bonds.  Oglethorpe hereby agrees to give notice to
the Owner Participant and to AMBAC of Oglethorpe’s payment of the Unpaid
Premium Amount (as defined in the notice of Termination) and evidence thereof
(which evidence shall be reasonably satisfactory to the

 

16

 

requesting party or parties) no later than
one Business Day following a request by the Owner Participant or AMBAC, as the
case may be, for such information.

 

Section 6.               Miscellaneous.

 

(a)                                  Consents.  The Owner Participant covenants and agrees
that it shall not unreasonably withhold its consent to any consent requested of
the Facility Lessor under the terms of the Berkshire Documents that by its
terms is not to be unreasonably withheld by the Facility Lessor.  Each party to this Agreement hereby consents
to the execution of this Agreement, the other Berkshire Documents and the AMBAC
Surety Documents by each other party hereto or thereto and to the performance
by such other parties of their respective obligations hereunder and
thereunder.  The Owner Participant agrees
that it will not instruct the Owner Trustee or the Co-Trustee to take any
action in violation of the express terms of this Agreement.  RMLC irrevocably consents to the subrogation
of and transfer by the RMLC Assignee to Berkshire of the Subrogation Interest
and the Additional Subrogation Interest if, as and when provided hereunder and
the Berkshire Sublease Surety Bond. 
Berkshire acknowledges that any reference in this Agreement or the
Berkshire Surety Bonds to rights of RMLC and the Facility Lessor, respectively,
to which Berkshire may be subrogated or of which it may receive an assignment
shall be construed in a manner consistent with the grant by RMLC of a security
interest pursuant to the Facility Sublease Assignment Agreement; and
accordingly, without limitation, in the event that the Lien of the Facility
Sublease Assignment Agreement shall have been discharged the rights of the
Facility Lessor may have correspondingly reverted to RMLC.

 

(b)                                 Amendments and Waivers.  No term, covenant, agreement or condition of
this Agreement may be terminated, amended or compliance therewith waived
(either generally or in a particular instance, retroactively or
prospectively) except by an instrument or instruments in writing executed by
each party hereto.

 

(c)                                  Operative Documents.  The parties hereto acknowledge and agree that
this Agreement, each of the Berkshire Documents and the AMBAC Surety Documents
are and shall be Operative Documents, provided that the Agreement
Regarding Surety Bonds and the Berkshire Guaranty Agreement shall be Operative
Documents if and only if Berkshire or a designee of Berkshire shall
acquire, by subrogation, assignment, purchase or otherwise, the Owner
Participant’s Beneficial Interest or the Subrogation Interest or the rights of
the Owner Participant or the Head Lessee under the Operative Documents and, at
the time of such acquisition or at the time that Berkshire or any designee of
Berkshire shall be committed to make such acquisition or at any time
thereafter, either (A) an Event of Default or a Head Lessor Event of
Default shall exist or (B) Berkshire shall have received a demand for
payment under either of the Berkshire Surety Bonds.

 

(d)                                 Notices.  Unless otherwise expressly specified or
permitted by the terms hereof, all communications and notices provided for
herein shall be in writing or by a telecommunications device capable of
creating a written record, and any such notice shall become effective (a) upon
personal delivery thereof, including, without limitation, by overnight mail or
courier service, (b) in the case of notice by United States mail,
certified or registered, postage prepaid, return receipt requested, upon
receipt thereof, or (c) in the

 

17

 

case of notice by
such a telecommunications device, upon transmission thereof, provided such
transmission is promptly confirmed by either of the methods set forth in
clauses (a) or (b) above, in each case addressed to each party
hereto at its address set forth in the Participation Agreement or, in the case
of Berkshire, set forth in the Surety Bonds, or, in the case of any such party
hereto, at such other address as such party may from time to time designate by
written notice to the other parties hereto.

 

(e)           Survival.  All warranties, representations, indemnities
and covenants made by any party hereto, herein or in any certificate or other
instrument delivered by any such party or on behalf of any such party under
this Agreement shall be considered to have been relied upon by each other party
hereto and shall survive the consummation of the transactions contemplated
hereby and in the other Berkshire Documents regardless of any investigation
made by any such party or on behalf of any such party.

 

(f)            Successors and Assigns.  This Agreement shall be binding upon and
shall inure to the benefit of, and shall be enforceable by, the parties hereto
and their respective successors and assigns as permitted by and in accordance
with the terms of the Operative Documents, the Berkshire Documents or the AMBAC
Surety Documents, as applicable.  The Owner Participant covenants that prior to any transfer of its
Beneficial Interest or any interest therein it will ensure that any transferee
owner participant or transferee of any such interest (in each case other than
AMBAC, but subject to the requirements of the Participation Agreement) executes
an agreement assuming the obligations of the Owner Participant under this
Agreement (including this Section).

 

(g)           Governing Law.  This Agreement has been delivered in the
State of New York and shall be in all respects governed by and construed in
accordance with the laws of the State of New York including all matters of
construction, validity and performance.

 

(h)           Severability.  If any provision hereof shall be invalid,
illegal or unenforceable under Applicable Law, the validity, legality and
enforceability of the remaining provisions hereof shall not be affected or
impaired thereby.

 

(i)            Counterparts.  This Agreement may be executed in any number
of counterparts, each executed counterpart constituting an original but all
together only one Agreement.

 

(j)            Headings and Table of Contents.  The headings of the sections of this
Agreement are inserted for purposes of convenience only and shall not be
construed to affect the meaning or construction of any of the provisions
hereof.

 

(k)           Limitation of Liability.  The Trust Company is entering into the
Operative Documents to which it is a party solely as trustee under the Trust
Agreement and not in its individual capacity, except as expressly provided
herein or therein, and in no case whatsoever shall either Trust Company be personally
liable for, or for any loss in respect of, any of the statements,
representations, warranties, agreements or obligations of Facility Lessor or
Head Lessee, as applicable, hereunder or under any other Surety Bond Document,
as to all of which the other parties hereto agree to look solely to the Trust

 

18

 

Estate; provided,
however, that the Trust Company shall be liable hereunder for its own
gross negligence or willful misconduct or for a breach of its representations,
warranties and covenants made in its individual capacity in Section 3
hereof.

 

(l)                                     Consent to Jurisdiction.  Each of the parties hereto (i) hereby
irrevocably submits to the nonexclusive jurisdiction of the Supreme Court of
the State of New York, New York County (without prejudice to the right of any
party to remove to the United States District Court for the Southern District
of New York) and to the nonexclusive jurisdiction of the United States District
Court for the Southern District of New York for the purposes of any suit,
action or other proceeding arising out of this Agreement, the other Berkshire
Documents, or the subject matter hereof or thereof or any of the transactions
contemplated hereby or thereby brought by any of the parties hereto or their
successors or assigns; (ii) hereby irrevocably agrees that all claims in
respect of such action or proceeding may be heard and determined in such New
York State court, or in such federal court; and (iii) to the extent
permitted by Applicable Law, hereby irrevocably waives, and agrees not to
assert, by way of motion, as a defense, or otherwise, in any such suit, action
or proceeding any claim that it is not personally subject to the jurisdiction
of the above-named courts, that the suit, action or proceeding is brought in an
inconvenient forum, that the venue of the suit, action or proceeding is
improper or that this Agreement, the other Berkshire Documents, or the subject
matter hereof or thereof may not be enforced in or by such court.

 

(m)                               Waiver of Trial by Jury.  To the extent permitted by applicable law,
each of the parties hereto hereby irrevocably waives the right to demand a
trial by jury, in any such suit, action or other proceeding arising out of this
Agreement, the other Berkshire Documents, or the subject matter hereof or
thereof or any of the transactions contemplated hereby or thereby brought by
any of the parties hereto or their successors or assigns.

 

(n)                                 Further Assurances.  Each party hereto will promptly and duly
execute and deliver such further documents to make such further assurances for
and take such further action reasonably requested by and at the expense of any
party to whom such first party is obligated, all as may be reasonably necessary
to carry out more effectively the intent and purpose of this Agreement and the
other Berkshire Documents and the AMBAC Surety Documents.

 

Section 7.               Insurer Agreements Regarding Documents. 
AMBAC consents to the Owner Participant, the Owner Trustee and the
Co-Trustee entering into and performing their obligations under the Berkshire
Documents.   Berkshire consents to the
Owner Participant, the Owner Trustee and the Co-Trustee entering into and
performing their obligations under the AMBAC Surety Documents.

 

Section 8.               Lender’s Rights and Liens Unaffected.  (a) 
Notwithstanding anything in this Agreement, any other Berkshire Document or any
AMBAC Surety Document to the contrary, each of the parties hereto agrees and
acknowledges that nothing in the Berkshire Documents or the AMBAC Surety Documents
shall affect the rights or obligations of the Lender under the Operative

 

19

 

Documents as in effect
immediately prior to the date hereof except as expressly set forth in the
Operative Documents (other than the Berkshire Documents, the Berkshire Guaranty
Agreement, the AMBAC Surety Documents or this Agreement) as amended as of the
date hereof;

 

(b)           notwithstanding anything in this Agreement, any other
Berkshire Document or any AMBAC Surety Document to the contrary, Berkshire (i) acknowledges
the Lien of the Lender under the Loan Agreement and the Deed to Secure Debt
over, inter alia, all of the
rights and remedies of the Head Lessee and the Facility Lessor in and under the
Operative Documents (except to the extent constituting Excepted Payments or
Excepted Rights), and (ii) agrees that (A) such rights and remedies
of the Head Lessee and the Facility Lessor to which Berkshire would be
subrogated effective upon Berkshire’s “Payment in Full” as is defined and set
forth in paragraph 11(f) of each of the Berkshire Surety Bonds shall
remain subject to such Lien of the Lender (except to the extent constituting
Excepted Payments or Excepted Rights), for as long as the Loan Agreement or the
Deed to Secure Debt shall not have been terminated pursuant to the terms
thereof, and (B) that it will not exercise any rights of subrogation,
assignment or similar rights created or permitted under the Berkshire Documents
or this Agreement so as to interfere with the rights and remedies of the Lender
under the Operative Documents as in effect immediately prior to the date hereof
except as expressly set forth in the Operative Documents (other than the
Berkshire Documents, the Berkshire Guaranty Agreement, the AMBAC Surety Documents,
the Lender Consent (as defined in the Agreement Regarding Surety Bonds) or this
Agreement) as amended as of the date hereof;

 

(c)           notwithstanding anything in this Agreement, any other
Berkshire Document or any AMBAC Surety Document to the contrary, AMBAC (i) acknowledges
the Lien of the Lender under the Loan Agreement and the Deed to Secure Debt
over all of the rights and remedies of the Head Lessee and the Facility Lessor
in and under the Operative Documents (except to the extent constituting
Excepted Payments or Excepted Rights), and (ii) agrees that (A) such
rights and remedies of the Head Lessee and the Facility Lessor to which AMBAC
would be subrogated effective upon AMBAC’s “Payment in Full” as is defined and
set forth in paragraph 11(f) of each of the AMBAC Surety Bonds shall
remain subject to such Lien of the Lender (except to the extent constituting
Excepted Payments or Excepted Rights), for as long as the Loan Agreement has
not been terminated pursuant to the terms thereof, and (B) that it will not
exercise any rights of subrogation, assignment or similar rights created or
permitted under the AMBAC Surety Documents so as to interfere with the rights
and remedies of the Lender under the Operative Documents as in effect
immediately prior to the date hereof except as expressly set forth in the
Operative Documents (other than the Berkshire Documents, the Berkshire Guaranty
Agreement, the AMBAC Surety Documents, the Lender Consent or this Agreement) as
amended as of the date hereof; and

 

(d)           the parties hereto agree that the Lender shall be the
intended third party beneficiary of this Section 8.  This Section 8 cannot be amended,
supplemented or otherwise modified without the prior written consent of the
Lender.

 

20

 

Section 9.               Termination Upon Release of Berkshire. 
This Implementation Agreement and the Berkshire Assignment Agreement and
all rights and obligation of the parties hereunder and thereunder shall
automatically terminate without any action by or liability of any of the
parties hereto and be of no further force and effect on the first date on which
all of the following conditions are satisfied: (x) the Berkshire Surety
Bonds are terminated or released, (y) Berkshire shall have no further
obligation or liability thereunder, hereunder or under the Berkshire Assignment
Agreement and (z) Berkshire shall have received indefeasible payment of
all amounts (if any) due under the Berkshire Guaranty Agreement (without regard
to any limitation of the amounts so due by reason of applicable law) or any
other Operative Document or Surety Bond Document.  For the avoidance of doubt, nothing in this Section 9
shall affect or limit the indemnification obligations of Oglethorpe under
Sections 11.1 and 11.2 of the Participation Agreement, Section 2.03 of the
AMBAC Guaranty Agreement or Section 2.03 of the Berkshire Guaranty
Agreement.  Upon such termination, (i) all
references to Berkshire in any Operative Document shall be disregarded (other
than as provided in the preceding sentence) and such document shall be deemed
modified accordingly and (ii) each of the parties hereto shall, at the
request of any other party hereto but at the expense of Oglethorpe, execute and
deliver an instrument in form and substance reasonably satisfactory to the
parties thereto evidencing the termination of this Implementation Agreement,
the Berkshire Assignment Agreement and the rights and obligations hereunder of
the parties thereto.

 

[Remainder of this page intentionally left blank]

 

21

 

IN
WITNESS WHEREOF, the parties hereto have caused this Surety Bond Implementation
Agreement (P1) to be executed and delivered by their respective officers
thereunto duly authorized as of the day and year first written above.

 

 

	
   

  	
  OGLETHORPE POWER CORPORATION

  
	
   

  	
  (AN ELECTRIC MEMBERSHIP CORPORATION)

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Thomas A. Smith

  
	
   

  	
   

  	
  Name:

  	
  Thomas
  A. Smith

  
	
   

  	
   

  	
  Title:

  	
  President
  and Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  (CORPORATE
  SEAL)

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Attest:

  	
  /s/
  Patricia N. Nash

  
	
   

  	
   

  	
  Name:

  	
  Patricia
  N. Nash

  
	
   

  	
   

  	
  Title:

  	
  Secretary

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  ROCKY MOUNTAIN LEASING CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Elizabeth B. Higgins

  
	
   

  	
   

  	
  Name:

  	
  Elizabeth
  B. Higgins

  
	
   

  	
   

  	
  Title:

  	
  President

  
	
   

  	
   

  	
   

  
	
   

  	
  Attest:

  	
  /s/
  Patricia N. Nash

  
	
   

  	
   

  	
  Name:

  	
  Patricia
  N. Nash

  
	
   

  	
   

  	
  Title:

  	
  Assistant
  Secretary

  
					

 

22

 

	
   

  	
  U.S. BANK NATIONAL ASSOCIATION,

  
	
   

  	
  not in
  its individual capacity, except to the extent provided in the Participation
  Agreement, but solely as Owner Trustee under the Trust Agreement

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Mark A. Forgetta

  
	
   

  	
   

  	
  Name:

  	
  Mark A.
  Forgetta

  
	
   

  	
   

  	
  Title:

  	
  Vice
  President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  U.S. BANK NATIONAL ASSOCIATION,

  
	
   

  	
  not in
  its individual capacity, except to the extent provided in the Participation
  Agreement, but solely as Co- Trustee under the Trust Agreement

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Jack Ellerin

  
	
   

  	
   

  	
  Name:

  	
  Jack
  Ellerin

  
	
   

  	
   

  	
  Title:

  	
  Vice
  President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  PHILIP MORRIS CAPITAL CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Alex T. Russo

  
	
   

  	
   

  	
  Name:

  	
  Alex T.
  Russo

  
	
   

  	
   

  	
  Title:

  	
  Vice
  President

  

 

23

 

	
   

  	
  AMBAC ASSURANCE CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Michael C. Morcom

  
	
   

  	
   

  	
  Name:

  	
  Michael C. Morcom

  
	
   

  	
   

  	
  Title:

  	
  First Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  BERKSHIRE HATHAWAY ASSURANCE CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Kara Raiguel

  
	
   

  	
   

  	
  Name:

  	
  Kara Raiguel

  
	
   

  	
   

  	
  Title:

  	
  Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ [signature illegible]

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Vice President

  

 

24

 

EXHIBIT A

 

Form of Berkshire Head Lease Surety Bond

 

SURETY
BOND

(Head Lease-P1)

 

Berkshire Hathaway Assurance Corporation

3024 Harney Street

Omaha, NE 68131

Facsimile No.:  (402) 916-3237

 

	
  Effective Date: May 22,
  2009

  	
  Policy
  No. 98SRD102494

  

 

Berkshire Hathaway Assurance Corporation
(together with its successors and permitted assigns, “Berkshire”), in
consideration of the payment to it on the date hereof and from time to time
hereafter of the premium payable in respect of this Surety Bond as separately
agreed between Berkshire and Oglethorpe Power Corporation (An Electric
Membership Corporation) (together with its successors and permitted assigns, “Oglethorpe”)
(such payment and any future payments of premium in respect of this Surety Bond
being collectively referred to as the “Premium”), receipt of which for
the amount of such premium payable on the date hereof is hereby acknowledged,
and subject to the terms of this Surety Bond, hereby unconditionally and
irrevocably guarantees to (a) U.S. Bank National Association, successor in
interest to SunTrust Bank, Atlanta, as Co-Trustee (together with its successors
and assigns, the “Head Lessee”) under the Rocky Mountain Head Lease
Agreement (P1) dated as of December 30, 1996 by and between Oglethorpe and
the Head Lessee (as amended, modified, supplemented and in effect from time to
time, the “Head Lease”), and (b) Philip Morris Capital Corporation
(together with its successors and assigns, the “Owner Participant” and,
together with the Head Lessee, the “Guaranteed Parties”), the full and
complete payment, without duplication, of (i) any and all amounts of (A) Termination
Value and amounts computed by reference to Termination Value under the Head
Lease and (B) the Oglethorpe Portion of Equity Termination Value and amounts
computed by reference to the Oglethorpe Portion of Equity Termination Value
under the Participation Agreement (P1) dated as of December 30, 1996, by
and among Oglethorpe, Rocky Mountain Leasing Corporation (“RMLC”), the
Head Lessee, U.S. Bank National Association, successor in interest to Fleet
National Bank, as Owner Trustee, the Owner Participant and Utrecht-America
Finance Co. (“Lender”) (as amended, modified, supplemented and in effect
from time to time, the “Participation Agreement” and, together with the
Head Lease, the “Subject Agreements”), and (ii) all amounts payable
by AMBAC Assurance Corporation (formerly known as AMBAC Indemnity Corporation)
(together with its successors and permitted assigns, “AMBAC”) under the
Amended and Restated Surety Bond (Head Lease-P1) issued on May 22, 2009,
Policy No. SF0003BE (the “AMBAC Surety Bond”), executed by AMBAC in
favor of the Guaranteed Parties (all such amounts under clauses (i) and (ii) above,
together with any other payments due (or, if payable upon demand, that shall be
accrued and unpaid and, unless demand therefor shall have been stayed by
operation of law, shall have been duly demanded) at such time constituting
obligations of Oglethorpe under the Participation 

 

 

Agreement or the other Operative Documents, being
referred to as the “Covered Obligations”) as at any time such payments
are (1) in the case of clause (i) above, due from Oglethorpe under
the terms of the Head Lease, the Participation Agreement or any of the other
Operative Documents but shall not be so paid, or are payable by, or the present
payment of which are payable upon demand, and could be demanded from,
Oglethorpe pursuant to the terms of the Head Lease, the Participation Agreement
or any of the other Operative Documents absent the operation of a stay or other
order issued in an Insolvency Proceeding (as hereinafter defined) pertaining to
the insolvency of Oglethorpe, and have not been paid, or (2) in the case
of clause (ii) above, due from AMBAC under the terms of the AMBAC Surety
Bond and shall not be so paid, or are payable by, or the present payment of
which could be demanded from, AMBAC under the terms of the AMBAC Surety Bond
absent the operation of a stay or other order issued in an Insolvency
Proceeding pertaining to the insolvency of AMBAC, but have not been paid; provided
that, except in circumstances in which Payment in Full (as defined below) is
payable in accordance with the terms hereof, the amount available at any
particular time to be paid by Berkshire hereunder shall be not more than the
Deficiency computed as provided in the form of Demand for Payment annexed
hereto as Attachment I or the amount computed as provided in the form of Demand
for Avoided Payment (as defined below) annexed hereto as Attachment II, as the
case may be, and in either case not exceed (i) the Surety Bond Coverage
(as defined in paragraph 7 hereof), plus (ii) interest at the Overdue Rate
on any amounts due and payable by Berkshire hereunder from and including the
date such amounts are due and payable by Berkshire hereunder plus (iii) expenses
payable by Berkshire under paragraph 12 hereof. 
Capitalized terms used herein or in any Demand for Payment, Demand for
Avoided Payment or Notice of Termination (as defined below) but not defined
herein or therein shall have the respective meanings set forth in Appendix A to
the Participation Agreement.  The general
provisions of such Appendix A shall apply to terms used in this Surety Bond and
defined herein or therein.

 

1.                                       Upon receipt by Berkshire of a demand for payment for a portion or all of
the unpaid amount of the Covered Obligations in an amount up to and including,
but not exceeding, the Surety Bond Coverage (the “Deficiency”) conforming to
and in the form attached hereto as Attachment I (a “Demand for Payment”),
with all blank spaces therein for variable information completed, duly executed
by the Head Lessee and the Owner Participant and certifying that:

 

(a)           either (i) at least two Business
Days prior to the date of such Demand for Payment, the Head Lessee or the Owner
Participant demanded in writing (such demand being the “Oglethorpe Payment
Demand”) payment from Oglethorpe of an amount (the “Oglethorpe Claimed
Amount”) not less than the Deficiency, and such Oglethorpe Claimed Amount
was then due and payable and as of the date of the Demand for Payment hereunder
continues to be due and payable, or (ii) for a period of at least two
Business Days prior to the date of delivery of the Demand for Payment
hereunder, the Head Lessee or the Owner Participant has been and continues to
be stayed (as a consequence of an Insolvency Proceeding pertaining to the
insolvency of Oglethorpe) or has been and continues to be otherwise legally
prohibited from making an Oglethorpe Payment Demand, and but for the existence
of such stay or other prohibition, the Head Lessee or the Owner Participant
would have been entitled to make such Oglethorpe Payment Demand and the
Oglethorpe Claimed Amount would thereupon have become due and payable by
Oglethorpe; provided, however, that the certification set forth
in this 

 

 

clause (a) shall
not be required in a Demand for Payment that is made after payment of the first
Surety Bond Payment Amount, and

 

(b)           either (i)(A) at least
one Business Day prior to the date of such Demand for Payment hereunder, (1) the
Head Lessee and the Owner Participant demanded in writing (such demand being
the “AMBAC Payment Demand”) payment from AMBAC of the unpaid portion of
the Oglethorpe Claimed Amount or, if less, the maximum amount then payable
under the AMBAC Surety Bond (the amount demanded under the AMBAC Surety Bond
being the “AMBAC Claimed Amount”) under and in compliance with the terms
of the AMBAC Surety Bond, and (2) all or any portion of the AMBAC Claimed
Amount was then due and payable under the terms of the AMBAC Surety Bond, and (B) such
AMBAC Claimed Amount or any portion thereof remains unpaid, or (ii) for a
period of at least one Business Day prior to the date of delivery of the Demand
for Payment hereunder, the Head Lessee or the Owner Participant has been and
continues to be stayed (as a consequence of an Insolvency Proceeding pertaining
to the insolvency of AMBAC) or has been and continues to be otherwise legally
prohibited from making an AMBAC Payment Demand, and but for the existence of
such stay or other prohibition, the Head Lessee or the Owner Participant would
have been entitled to make such AMBAC Payment Demand and the AMBAC Claimed
Amount or the applicable Surety Bond Payment Amount then payable under the
AMBAC Surety Bond would thereupon have become due and payable by AMBAC, and

 

(c)           the Head Lessee or the Owner
Participant has delivered to Berkshire (i) at least two Business Days
prior to the date of such Demand for Payment, either a copy of the Oglethorpe
Payment Demand or written notice that delivery thereof has been stayed or
otherwise prohibited as contemplated above, except that no such certification
or delivery shall be required in a Demand for Payment made after payment of the
first Surety Bond Payment Amount, and (ii) at least one Business Day prior
to the date of such Demand for Payment, either a copy of the AMBAC Payment
Demand or written notice that delivery thereof has been stayed or otherwise
prohibited as contemplated above, and

 

(d)           as of the date of such Demand for
Payment hereunder, a Deficiency exists, and

 

(e)           neither Ambac nor any
Affiliate of AMBAC shall have become the Owner Participant or shall be a party
to any contract or arrangement (other than the AMBAC Surety Documents, the
Implementation Agreement and, if applicable, the Loan Agreement, the Loan
Certificate and the Deed to Secure Debt (collectively, the “AMBAC Documents”))
with the Owner Participant or any Affiliate thereof or the Owner Trustee
pursuant to which AMBAC or any such Affiliate of AMBAC shall have acquired or
shall (other than as provided in the AMBAC Documents) have the right to acquire
all or substantially all of the economic benefits attributable to the
Beneficial Interest, the Trust Estate or the Leasehold Interest or any
substantial part thereof or interest therein,

 

Berkshire will pay to the Head Lessee or the Owner
Participant (as specified in such Demand for Payment and at the place of
payment set forth in such Demand for Payment), on the Business Day following
the date of receipt of such Demand for Payment, an amount equal to the 

 

 

Deficiency (but in no event to exceed the Surety Bond
Coverage), in each case by wire transfer as specified in such Demand for
Payment.  Berkshire shall also pay
interest at the Overdue Rate on any amounts payable hereunder and on accrued
but unpaid interest thereon (to the extent permitted by law) from and including
the date such amounts are due and payable hereunder to (but excluding) the date
of payment.

 

2.             A Demand for Payment, a Demand for
Avoided Payment, a copy of an Oglethorpe Payment Demand (or written notice that
delivery thereof has been stayed or otherwise prohibited) delivered under
clause (1)(c)(i) hereof, if required hereunder, or a copy of an AMBAC
Payment Demand (or written notice that delivery thereof has been stayed or
otherwise prohibited) delivered under clause (1)(c)(ii) hereof shall be
personally delivered or sent by telecopy to Berkshire at Berkshire’s “Address
for Notice” set forth in paragraph 8 hereof.  Any Demand for Payment, Demand for Avoided
Payment or copy or notice pursuant to the next preceding sentence so received
by Berkshire after 2:00 p.m. New York City time on any Business Day or on
any day that is not a Business Day shall be deemed to have been received by
Berkshire prior to 2:00 p.m., New York City time, on the next succeeding
Business Day.  As used herein, the term “Business
Day” shall mean any day other than a Saturday, a Sunday or any day on which
banking institutions in New York, New York are authorized or required by law to be closed. 
If a Demand for Payment or Demand for Avoided Payment made hereunder is not, in any instance, effected in accordance with
the terms and conditions of this Surety Bond, Berkshire shall give notice to
the Head Lessee and the Owner Participant, as promptly as reasonably
practicable, that such Demand for Payment or Demand for Avoided Payment, as the
case may be, was not effected in accordance with the terms and conditions of
this Surety Bond and briefly state the reason(s) therefor.  Upon being notified that such Demand for
Payment or Demand for Avoided Payment was not effected in accordance with the
terms and conditions of this Surety Bond, the Head Lessee or the Owner
Participant may attempt to correct any such nonconforming Demand for Payment or
Demand for Avoided Payment, as the case may be. 
Multiple Demands for Payment or Demands for Avoided Payment shall be
permitted hereunder.

 

3.             [Intentionally omitted]

 

4.             Any service of process on Berkshire
may be made to Berkshire at Berkshire’s “Address for Notice” set forth in
paragraph 8 hereof, and such service of process shall be valid and binding
as to Berkshire.

 

5.             This Surety Bond is noncancelable
for any reason.  Subject to
paragraph 6 below, this Surety Bond and the obligations of Berkshire
hereunder shall terminate on the earliest of (i) so long as Berkshire is
not in default with respect to any of its obligations hereunder, January 11,
2027, (ii) two (2) days after the Surety Bond Coverage is reduced to zero dollars, (iii) upon receipt by
Berkshire of written notice from the Head Lessee and the Owner Participant
stating that Berkshire is released from its obligations under this Surety Bond, (iv) the date on which payment
is made by Berkshire in full of the amount required to be paid pursuant to a
Demand for Payment, (v) except with respect to coverage for Avoided
Payments, the date on which payment is made in full of all Covered Obligations
of Oglethorpe or AMBAC or the date on which Oglethorpe or AMBAC are released
(in a writing signed by the Head Lessee or the Owner Participant) from further
liability in respect of all Covered Obligations, other than with the written
consent of Berkshire, (vi) the date, if any, on which Ambac or any
Affiliate of AMBAC 

 

 

shall have become the Owner
Participant or shall be a party to any contract or arrangement (other than the
AMBAC Documents) with the Owner Participant or any Affiliate thereof or the
Owner Trustee pursuant to which AMBAC or any such Affiliate of AMBAC shall have
acquired or shall (other than as provided in the AMBAC Documents) have the
right to acquire all or substantially all of the economic benefits attributable
to the Beneficial Interest, the Trust Estate or the Leasehold Interest or any
substantial part thereof or interest therein,  and (vii) 80 days (the “Cure
Period”) after the later of (x) the third Surety Bond Payment Date (as
defined in the AMBAC Surety Bond) if AMBAC paid the first Surety Bond Payment
Amount or (y) delivery by Berkshire to the Head Lessee and the Owner
Participant (with a copy to AMBAC, unless delivery to AMBAC shall be stayed by
law) of a notice in the form of Attachment III hereto (a “Notice of
Termination”) in accordance with the notice procedures in this paragraph 5
unless Berkshire shall have received prior to the expiration of the Cure Period
the full amount of the unpaid portion of the Premium referred to in the Notice
of Termination or a Demand for Payment.

 

Berkshire shall deliver a Notice of Termination upon the Head Lessee
and the Owner Participant in the following manner:

 

(i)                                     The Notice of
Termination shall be sent by FedEx or other similar courier service (FedEx and
any such other courier service being referred to herein as the “Courier
Service”) to each of the Owner Participant and the Head Lessee at its
address set forth in paragraph 8 hereof and to each of addressees listed on Exhibit A
hereto at the addresses set forth on such Exhibit (as such Exhibit may
be modified by written notice from the Owner Participant to Berkshire from time
to time), and shall also be sent by email to the addressees listed on Exhibit A
to the email addresses for such persons set forth on such Exhibit (as such
Exhibit may be modified by written notice from the Owner Participant to
Berkshire from time to time as provided above).

 

(ii)           Each Notice of
Termination sent by Courier Service pursuant to this paragraph 5 shall be
accompanied by a notice (printed on red paper) affixed to the outside of the
envelope containing such Notice of Termination in the form of Attachment IV hereof.  Each notice sent by email shall also contain
a notice in the form of Attachment IV.

 

(iii)          On the Business
Day immediately preceding, on or within two Business Days following the date on
which the Notice of Termination is sent by Courier Service as provided above,
an officer, employee, representative or agent of Berkshire shall, between the
hours of 9:00 a.m. and 5:00 p.m., New York time, place a telephone
call to each of the persons listed on Exhibit A to the phone numbers
listed on such Exhibit (as such Exhibit may be modified by written
notice from the Owner Participant to Berkshire from time to time), and shall (A) if
such person is available and answers the phone at such time, inform such person
that such person “will be receiving by Courier Service an important Notice of
Termination regarding the Oglethorpe Leveraged Lease Transaction (P1),” or (B) if

 

 

such person is not then available, use
reasonable efforts to leave a voicemail message on such person’s voicemail, and
a message with any person who then answers such person’s telephone, to the same
effect as set forth in clause (A) above.

 

6.             Notwithstanding the provisions of
paragraph 5 hereof, (a) if the payment of any amount in respect of
the Covered Obligations is avoided (an “Avoidance Event”) under any applicable
Insolvency Proceeding with respect to Oglethorpe or AMBAC, and, as a result of
such Avoidance Event, the Head Lessee or the Owner Participant is required to
return or turn over such avoided payment, or any portion of such avoided payment
(an “AMBAC Avoided Payment” in the case of an Insolvency Proceeding with
respect to AMBAC, an “Oglethorpe Avoided Payment” in the case of an Insolvency
Proceeding with respect to Oglethorpe, and each an “Avoided Payment”), and (b) Berkshire
has not theretofore made a payment of the maximum amount of the Surety Bond
Coverage to the Head Lessee or the Owner Participant, Berkshire will pay (1) with
respect to an Oglethorpe Avoided Payment, the amount thereof minus any payments
(other than AMBAC Avoided Payments) with respect thereto made by AMBAC under
the AMBAC Surety Bond, and (2) with respect to an AMBAC Avoided Payment,
the sum of, without duplication, (x) the amount thereof plus (y) that
portion of the Claimed Amount (as defined in the AMBAC Surety Bond) that
remains unpaid as of the date the Demand for Avoided Payment relating thereto
is given to Berkshire in accordance with paragraph 8 hereof, in each case out
of the funds of Berkshire, when the applicable or related Avoided Payment is
due to be paid pursuant to the Order referred to below, but in any event no
earlier than the second Business Day following receipt by Berkshire of (i) a
certified copy of an order of a court or other body exercising jurisdiction in
such Insolvency Proceeding to the effect that the Head Lessee or the Owner
Participant is required to return or pay over such Avoided Payment because such
Avoided Payment was avoided as a preferential transfer or otherwise rescinded
or required to be restored by the Head Lessee or the Owner Participant (the “Order”),
(ii) a certificate by or on behalf of the Head Lessee or the Owner
Participant that the Order has been entered and is not subject to any stay, and
that the Head Lessee or the Owner Participant, as the case may be, has complied
with or will timely comply with such order, (iii) an assignment, in the
form of Exhibit A to the Demand for Avoided Payment, duly executed and
delivered by the Head Lessee and the Owner Participant, irrevocably assigning
to Berkshire all rights and claims of the Head Lessee and the Owner Participant
(subject to the rights of the Lender as provided in the Loan Agreement)
relating to or arising under the Operative Documents against (A) Oglethorpe
or its estate, in the case of and with respect to an Oglethorpe Avoided
Payment, or (B) AMBAC or its estate, in the case of and with respect to an AMBAC Avoided Payment and that
portion of the Claimed Amount (as defined in the AMBAC Surety Bond) remaining
unpaid as of the date of Demand for Avoided Payment and (iv) a demand for
payment for a portion or all of the unpaid amount of the Avoided Payment and,
in the case of an AMBAC Avoided Payment, any unpaid portion of the Claimed
Amount, in an amount up to and including, but not exceeding, the amount set
forth in the next succeeding paragraph, conforming to and in the form attached
hereto as Attachment II (a “Demand for Avoided Payment”), with all blank
spaces therein for variable information completed, duly executed by the Head
Lessee and the Owner Participant, and containing the certifications set forth
therein.  Such payment shall be disbursed
to the receiver, conservator, debtor-in-possession or trustee in bankruptcy
named in the Order, and not to the Head Lessee or the Owner Participant
directly, unless and only to the extent the Head Lessee or the Owner
Participant has made a payment of the Avoided Payment to the court or such
receiver, 

 

 

conservator,
debtor-in-possession or trustee in bankruptcy named in the Order, in which case
Berkshire will pay the Head Lessee or the Owner Participant, as applicable,
provided, that there has been delivery of (a) the items referred to in
clauses (i), (ii), (iii) and (iv) above to Berkshire and (b) evidence
satisfactory to Berkshire that such payment has been made to such court or receiver,
conservator, debtor-in-possession or trustee in bankruptcy named in the
Order.  “Insolvency Proceeding” means the
commencement, after the date hereof, of any bankruptcy, insolvency,
readjustment of debt, reorganization, marshalling of assets and liabilities or
similar proceedings by or against any person, or the commencement, after the
date hereof, of any proceedings by or against any person for the winding up or
the liquidation of its affairs, or the consent after the date hereof to the
appointment of a trustee, conservator, receiver or liquidator in any
bankruptcy, insolvency, readjustment of debt, reorganization, marshalling of
assets and liabilities or proceedings similar to the foregoing relating to any
person.

 

Notwithstanding
anything to the contrary herein, in no event shall Berkshire be obligated to
make any payment (other than the payment of interest and expenses as herein
provided) pursuant to any Demand for Avoided Payment, which payment, when added
to all other payments (other than the payment of interest and expenses as
herein provided) made under this Surety Bond and the Sublease Surety Bond,
would exceed the Surety Bond Coverage as of the date applicable to such payment
under the definition of “Surety Bond Coverage” in paragraph 7(j) hereof.

 

Upon
receipt by Berkshire of any payment in respect of the Premium or any portion
thereof, neither such payment nor any part thereof shall be subject to rebate,
reduction or refund for any reason or under any circumstances whatsoever,
including, without limitation, the payment or prepayment of Oglethorpe’s
obligations under the Facility Sublease or any of the other Operative Documents
or the obligations of AMBAC under the AMBAC Surety Bond or the AMBAC Sublease
Surety Bond, or the termination or release of this Surety Bond or the AMBAC
Surety Bond prior to the termination of the Subject Agreements.

 

7.                                       As used herein, the following capitalized terms shall have the following
meanings:

 

(a)           “AMBAC Assignment Agreement” means the Agreement
for Assignment on Default (P1) dated as of December 30, 1996 among the
Owner Participant, the Owner Trustee, the Co-Trustee and AMBAC, as amended.

 

(b)           “AMBAC Purchase Option” means the “Purchase Option”
under and as defined in the AMBAC Assignment Agreement.

 

(c)           “AMBAC Sublease Surety Bond” means the Amended and Restated Surety Bond (Facility
Sublease-P1) issued on May 22, 2009, Policy No. SF0004BE, executed by
AMBAC in favor of the “Guaranteed Parties” named therein.

 

(d)           “AMBAC Surety
Documents” means, collectively, the AMBAC Surety Bond, the AMBAC Sublease
Surety Bond and the AMBAC Assignment Agreement.

 

(e)           “Berkshire Assignment on Default” means the
Berkshire Agreement for Assignment on Default (P1) dated as of the date hereof
among Berkshire, the Co-Trustee, the Owner Trustee and the Owner Participant.

 

 

(f)            “Berkshire Purchase Option” means the “Purchase
Option” under and as defined in the Berkshire Assignment on Default.

 

(g)           “Excluded Rights” means all rights, remedies and
benefits under the Operative Documents of the Owner Participant in respect of
the period on or prior to the date of Payment in Full (including, without
limitation, under Sections 11 and 12 of the Participation Agreement and under
the Tax Indemnity Agreement) that accrue in respect of or that are attributable
to acts, omissions, facts or events existing or occurring on or prior to the
time of Payment in Full, but excluding any amounts owing to the Owner
Participant that are included in the calculation of the amount of such Payment
in Full.

 

(h)          “Implementation Agreement” means the Surety Bond
Implementation Agreement (P1), dated as of the date hereof, among Oglethorpe,
RMLC, the Owner Participant, the Owner Trustee, the Co-Trustee, AMBAC and
Berkshire.

 

(i)            “Sublease Surety
Bond” means Surety Bond (Facility Sublease-P1) No. 98SRD102495 issued by Berkshire with respect to certain
payment obligations of Oglethorpe under the Participation Agreement and certain
payment obligations of AMBAC under the AMBAC Sublease Surety Bond.

 

(j)            “Surety Bond Coverage” means,
for any period set forth on Schedule A attached hereto with respect to the
payment of any Deficiency and any Avoided Payment hereunder, (x) the
amount shown opposite the period in which the date on which the Demand for
Payment of such Deficiency or Avoided Payment is given to Berkshire in
accordance with paragraph 8 hereof or deemed given to Berkshire as set forth
below in this paragraph (j); minus (y) any amounts (other than
amounts that constituted AMBAC Avoided Payments) previously paid hereunder and
under the Sublease Surety Bond, the AMBAC Surety Bond and the AMBAC Sublease
Surety Bond.  The amount described in
clause (y) above shall be determined without regard to any amounts
previously paid comprising expenses payable under the AMBAC Surety Bond, the
AMBAC Sublease Surety Bond, paragraph 12 hereof or under paragraph 12 of the
Sublease Surety Bond or interest on amounts not paid by Berkshire when due and
payable hereunder as provided in the last sentence of paragraph 1 hereof or the
last sentence of paragraph 1 of the Sublease Surety Bond or interest on amounts
not paid by AMBAC when due and payable under the AMBAC Surety Bond or the AMBAC
Sublease Surety Bond (excluding any interest that could have been avoided under
the AMBAC Surety Bond or the AMBAC Sublease Surety Bond had a Demand for
Payment or Demand for Avoided Payment been made hereunder or under the Sublease
Surety Bond at the earliest date provided for such a Demand for Payment or
Demand for Avoided Payment, as the case may be, hereunder or thereunder).  With respect to any AMBAC Avoided Payment,
the date on which Demand for Payment of such AMBAC Avoided Payment is deemed
given to Berkshire for purposes of the first sentence of this paragraph 7(j) shall
be the Business Day next following the date on which such AMBAC Avoided Payment
was first demanded from AMBAC.  With
respect to any Deficiency hereunder payable after AMBAC shall have paid the
first Surety Bond Payment Amount, the date on which Demand for Payment of such
Deficiency is deemed given to Berkshire for purposes of the first sentence of
this 

 

 

paragraph 7(j) shall
be the Business Day next following the date on which such first Surety Bond
Payment Amount was first demanded from AMBAC.

 

(k)           “Surety Bond Payment Amount”
has the meaning set forth in the AMBAC Surety Bond.

 

8.                                       Except as otherwise provided in paragraph 5 hereof and subject to
paragraph 2 hereof, all notices, requests and other communications provided for
herein shall be given or made in writing (including, without limitation, by
telecopy) delivered to the intended recipient at the following addresses or, as
to Berkshire, the Head Lessee, the Owner Participant or Oglethorpe, at such
other address as shall be designated by such Person in a notice to each other such
Person (such address with respect to any party, including copies as specified
below, being the “Address for Notice” of such party), and all such
communications shall be deemed to have been duly given when transmitted by
telecopier or personally delivered or, in the case of a mailed notice, upon
receipt, in each case given or addressed as aforesaid:

 

Berkshire

 

Berkshire
Hathaway Assurance Corporation

c/o
Berkshire Hathaway Group

100
First Stamford Place

Stamford,
CT 06902

Attn:  General Counsel

Facsimile
No.:  (203) 363-5221

 

with
copies to:

 

Berkshire
Hathaway Assurance Corporation

3024 Harney Street

Omaha, NE 68131

Attention:  President

Facsimile No.:  (402) 916-3237

 

and

 

Robert
E. Bennett

99 Mill Lane

Norwell, MA 02061

Facsimile No.:  (781) 659-2491

 

 

Head Lessee

 

U.S.
Bank National Association

EX-GA-ATPT

1349 W. Peachtree Street, Suite 1050

Atlanta, GA 30309

Facsimile No.:  (404) 898-2467

Telephone No.: (404) 898-8830

Attention: Jack Ellerin

 

Owner
Participant

 

Philip
Morris Capital Corporation

225 High
Ridge Road

Suite 300
West

Stamford,
Connecticut 06905

Facsimile
No.:  (203) 708-8256

Telephone
No.: (203) 708-8347

Attention:
General Counsel

 

with a
copy to:

 

Philip
Morris Capital Corporation

225
High Ridge Road

Suite 300
West

Stamford,
Connecticut 06905

Facsimile
No.:  (203) 708-8256

Telephone
No.: (203) 708-8204

Attention:
Alex Russo, Vice President/Asset and Portfolio Management

 

9.             Berkshire’s obligations under this
Surety Bond (a) are absolute and unconditional, (b) constitute a
guaranty of payment and not a guaranty of collection, (c) shall be a
continuing guaranty of all present and future Covered Obligations and all
amendments, modifications, supplements, renewals of or extensions to the
Covered Obligations, whether such amendments, modifications, supplements,
renewals or extensions are evidenced by new or additional instruments,
documents or agreements, and (d) shall be irrevocable.  The obligations of Berkshire to make any
payment hereunder shall, to the extent permitted by Applicable Law, constitute
separate and independent obligations of Berkshire, and give rise to separate
and independent causes of action against Berkshire.  Berkshire specifically agrees that, subject
to receipt by Berkshire of a Demand for Payment or a Demand for Avoided Payment
conforming to and in the form of Attachment I or II hereto, as the case may be,
it shall not be necessary, and that Berkshire shall not be entitled to require,
before or as a condition of enforcing the liability of Berkshire under this
Surety Bond or requiring payment or performance of the Covered Obligations by
Berkshire hereunder, or at any time thereafter, that any Person:  (i) file suit or proceed to obtain or
assert a claim for personal judgment against Oglethorpe, AMBAC or any 

 

 

other
Person that may be liable for any Covered Obligation, (ii) other than as
set forth in paragraph 1 hereof, make any other effort to obtain payment
or performance of any Covered Obligation from Oglethorpe, AMBAC or any other
Person that may be liable for such Covered Obligation, (iii) foreclose
against or seek to realize upon any security now or hereafter existing for such
Covered Obligation, (iv) other than as set forth in paragraph 1
hereof, exercise or assert any other right or remedy to which such Person is or
may be entitled in connection with any Covered Obligation or any security or
other guaranty therefor, or (v) other than as set forth in
paragraph 1 hereof, assert or file any claim against the assets of
Oglethorpe, AMBAC or any other Person liable for any Covered Obligation.

 

10.                                 THE OBLIGATIONS OF BERKSHIRE UNDER THIS SURETY BOND SHALL NOT BE REDUCED,
LIMITED OR TERMINATED, NOR SHALL BERKSHIRE BE DISCHARGED FROM ANY THEREOF, FOR
ANY REASON WHATSOEVER (other than by the payment of the Covered Obligations), including
(and whether or not the same shall have occurred or failed to occur once or
more than once and whether or not Berkshire shall have received notice
thereof):

 

(a)           (i) any increase of, (ii) any
extension of the time of payment or performance of, (iii) any other
amendment or modification of any of the other terms and provisions of, (iv) any
release, composition or settlement (whether by way of acceptance of a plan of
reorganization or otherwise) of, (v) any subordination (whether present or
future or contractual or otherwise) of, or (vi) any discharge,
disallowance, invalidity, illegality, voidness or other unenforceability of,
the Covered Obligations; provided, however, in each case that
Berkshire’s obligation to make payments hereunder shall in no event be greater
than the Surety Bond Coverage plus interest on amounts not paid by Berkshire
when due and payable hereunder as provided in the last sentence of
paragraph 1 hereof and expenses (other than expenses payable by AMBAC
under the AMBAC Surety Bond or the AMBAC Sublease Surety Bond);

 

(b)           (i) any failure to obtain or any
release of, (ii) any failure to protect or preserve, (iii) any
release, compromise, settlement or extension of the time of payment of any
obligations constituting, (iv) any failure to perfect or maintain the
perfection or priority of any Lien upon, (v) any subordination of any Lien
upon, or (vi) any discharge, disallowance, invalidity, illegality,
voidness or other unenforceability of, any Lien or intended Lien upon, any
collateral now or hereafter securing the Covered Obligations;

 

(c)          any invalidity or unenforceability of
the Head Lease or any other Operative Document for any reason whatsoever,
including any action taken pursuant to the Oglethorpe Mortgage;

 

(d)           any exercise of, or any election not
or failure to exercise, delay in the exercise of, waiver of, or forbearance or
other indulgence with respect to, any right, remedy or power available to a
Guaranteed Party, including (i) any election not or failure to exercise
any right of set-off, recoupment or counterclaim, (ii) any acceptance of
partial payments on the Covered Obligations, and (iii) any election of
remedies effected by a Guaranteed Party, whether or not such election affects
the right to obtain a deficiency judgment;

 

 

(e)           receipt by the Guaranteed Parties
(and holding thereby) of additional security or guaranties for the Covered
Obligations or any part thereof;

 

(f)            any bankruptcy, insolvency,
reorganization, arrangement, adjustment, composition, dissolution, liquidation
or the like with respect to, or in any manner affecting, RMLC, Oglethorpe,
AMBAC, Berkshire or any other Person, or any obligation of Oglethorpe, RMLC or
the RMLC Assignee under any Operative Document or of AMBAC under the AMBAC
Surety Bond or any application of Section 502(b)(6) or other
provision of the Bankruptcy Code that purports to limit Oglethorpe’s or RMLC’s
obligations under the Operative Documents;

 

(g)           any limitation of the remedies of the
Guaranteed Parties under the Head Lease or the other Operative Documents, or
any limitation of the liability of Oglethorpe under the Head Lease or the other
Operative Documents or of AMBAC under the AMBAC Surety Bond, which may now or
hereafter be imposed by any Applicable Law;

 

(h)           any merger or consolidation of
Oglethorpe, AMBAC or Berkshire into or with any other Person, or any transfer,
conveyance, sale, lease or other disposition of any or all of the assets of
Oglethorpe, AMBAC or Berkshire to any other Person, or any consent by the Head
Lessee or the Owner Participant to any such merger, consolidation, transfer of
assets or any other restructuring or termination of the corporate existence of
Oglethorpe, AMBAC, Berkshire or any other Person;

 

(i)            any debt of Oglethorpe or AMBAC to
any Person, including Berkshire;

 

(j)            any claim, set-off, deduction or
defense AMBAC or Berkshire may have against any of the Head Lessee, the Owner
Participant, Oglethorpe or the other parties to the Operative Documents or
AMBAC, whether hereunder or under the Head Lease or the other Operative
Documents or the AMBAC Surety Bond or independent of or unrelated to the
transactions contemplated by the Head Lease or the other Operative Documents or
the AMBAC Surety Bond (without prejudice to Berkshire’s right to assert such
claim, set-off, deduction or defense in a separate action unrelated to any
action for enforcement of this Surety Bond or the Covered Obligations, so long
as Berkshire does not set-off the amount of such claim, set-off, deduction or
defense against its obligation to pay the Covered Obligations hereunder); or

 

(k)           ANY OTHER ACT OR FAILURE TO ACT OR
ANY OTHER EVENT OR CIRCUMSTANCE THAT (i) VARIES THE RISK OF BERKSHIRE
UNDER THIS SURETY BOND OR (ii) BUT FOR THE PROVISIONS HEREOF, WOULD, AS A
MATTER OF STATUTE OR RULE OF LAW OR EQUITY, OPERATE TO REDUCE, LIMIT OR
TERMINATE THE OBLIGATIONS OF BERKSHIRE THEREUNDER OR DISCHARGE BERKSHIRE FROM
ANY THEREOF.

 

Anything
contained herein to the contrary notwithstanding, Berkshire shall be released
from further liability hereunder to the extent that any of the Guaranteed
Parties in writing releases, other than with the written consent of Berkshire,
AMBAC in respect of its obligations under the AMBAC Surety Bond or the AMBAC
Sublease Surety Bond.

 

 

11.                                 (a)                                  Berkshire waives any defense to, and any set-off, counterclaim and claim
of recoupment against, the Covered Obligations that may at any time be
available to Berkshire or any other guarantor (without prejudice to Berkshire’s
right to assert such defense, set-off, counterclaim or claim in a separate
action unrelated to any action for enforcement of this Surety Bond or the
Covered Obligations, so long as Berkshire does not set-off the amount of such
defense, set-off, counterclaim or claim against its obligation to pay Covered
Obligations hereunder).  Except as set
forth in paragraph 6 hereof and in this paragraph 11, (i) Berkshire
agrees not to exercise any right of subrogation which may otherwise inure to
its benefit as a result of any payment made by it under the Surety Bond until
all obligations of RMLC and Oglethorpe to the Co-Trustee, the Owner Trustee and
the Owner Participant under the Operative Documents have been fully discharged,
and (ii) Berkshire waives until such time, to the fullest extent permitted
by Applicable Law, (A) any right to enforce any remedy which any
Guaranteed Party now has or may hereafter have against Oglethorpe in respect of
any of the Covered Obligations, and (B) any benefit of, and any right to
participate in, any collateral now or hereafter held by any Guaranteed Party
for the Covered Obligations; provided, however, that if Berkshire shall have
paid in full the amount required by any Demand for Payment or Demand for
Avoided Payment hereunder, (1) Berkshire shall immediately be subrogated
to all rights of the Guaranteed Parties in respect of AMBAC’s obligations with
respect to any related Claimed Amount (as defined in the AMBAC Surety Bond or
the AMBAC Sublease Surety Bond) that is unpaid under the AMBAC Surety Bond
and/or the AMBAC Sublease Surety Bond, (2) Berkshire shall be entitled to
exercise any and all rights and to enforce any and all remedies which any
Guaranteed Party now has or may hereafter have against AMBAC with respect to
any related Claimed Amount that is unpaid under the AMBAC Surety Bond and/or
the AMBAC Sublease Surety Bond, and (3) Berkshire shall have the sole and
exclusive benefit of, and the sole and exclusive right to participate in, any
claims or recoveries to the extent of such amount and with respect to any
related Claimed Amount that is unpaid under the AMBAC Surety Bond and/or the
AMBAC Sublease Surety Bond, in each case under clauses (1), (2) and (3) for
its own benefit and to the exclusion of the Guaranteed Parties and any other
Persons, except as otherwise provided in the penultimate sentence of paragraph
11(f)(ii) hereof.

 

(b)                                 Berkshire
waives:  (i) notice of acceptance of
and intention to rely on this Surety Bond, (ii) notice of the incurrence
or renewal of any other Covered Obligation, (iii) notice of any of the
matters referred to in paragraph 10 hereof, and (iv) all other
notices that may be required by Applicable Law or
otherwise to preserve any rights against Berkshire under this Surety Bond,
including any notice of default, demand, dishonor, presentment or protest, in
each case except as expressly provided herein. 
Berkshire assumes the responsibility for being and keeping informed of
the financial condition of Oglethorpe and AMBAC and of all other circumstances
bearing upon the risk of nonpayment of the Covered Obligations which diligent
inquiry would reveal, and agrees that each Guaranteed Party shall have no duty
beyond its obligations in the Operative Documents to advise Berkshire of
information known to it regarding such condition or any such
circumstances.  It is not and shall not
be necessary for any Guaranteed Party to inquire into the powers of either
Oglethorpe or AMBAC or any of its agents acting or purporting to act on behalf
thereof, and any Covered Obligations made or created in reliance upon the
professed exercise of such powers shall be guaranteed hereunder.

 

(c)                                  Except
as set forth in paragraph 1 hereof, Berkshire waives any requirement, and
any right to require, that any right or power be exercised or any action be
taken against 

 

 

Oglethorpe
or AMBAC or any
collateral for the Covered Obligations, and Berkshire waives the right to have
the property of Oglethorpe or AMBAC first applied to the discharge of the Covered Obligations.  Each of the Head Lessee and the Owner Participant
may at its election exercise any right or remedy it may have against Oglethorpe
or AMBAC or any
collateral now or hereafter held by such Person, including, without limitation,
the right to foreclose upon any such collateral by judicial or nonjudicial sale,
without affecting or impairing in any way the liability of Berkshire
hereunder.  Berkshire waives:  (i) any defense arising by reason of any
disability or other defense of Oglethorpe or
AMBAC or by reason of the cessation from any cause
whatsoever of the liability, either in whole or in part, of Oglethorpe or AMBAC to each of the Head Lessee and
the Owner Participant for the Covered Obligations (without prejudice to
Berkshire’s right to assert a claim based on such disability or other defense
or cessation, in a separate action unrelated to any action for enforcement of
this Surety Bond or the Covered Obligations, so long as Berkshire does not
set-off the amount of such claim against its obligation to pay Covered
Obligations hereunder), (ii) any defense based on the discharge of
Oglethorpe or AMBAC by
operation of law, notwithstanding any intervention or omission by the Head
Lessee or the Owner Participant, and (iii) any defense based on or arising
out of the absence, impairment or loss of any right of reimbursement,
contribution, assignment or subrogation or any other right or remedy of
Berkshire against Oglethorpe or AMBAC or any such collateral, whether resulting from such election by the Head
Lessee or the Owner Participant or otherwise.

 

(d)                                 Berkshire
waives all rights, benefits or defenses under any Applicable Laws which:  (i) reduce the obligation of a surety
upon the acceptance by a creditor of anything in partial satisfaction of an
obligation, (ii) exonerate the surety if by an act of the creditor,
without the consent of the surety, the original obligation of the principal is
altered in any respect, or the remedies or rights of the creditor against the
principal, in respect thereto, are in any way suspended or impaired, (iii) exonerate
the surety to the extent that the creditor does not proceed against the
principal, or pursue any other remedy in the creditor’s power which the surety
cannot pursue, and which would lighten the surety’s burden, and (iv) reduce
the guaranteed obligation in proportion to the principal obligation; provided
that this paragraph (d) shall not apply to (A) any voluntary release,
voluntary reduction, voluntary amendment or voluntary termination of the AMBAC
Surety Bond or the AMBAC Sublease Surety Bond entered into by the Owner
Participant, the Owner Trustee or the Co-Trustee, as the case may be, or (B) any
release, reduction, amendment or termination of the AMBAC Surety Bond or the
AMBAC Sublease Surety Bond by the Owner Participant, the Owner Trustee or the
Co-Trustee in violation of the Operative Documents or Applicable Law; provided
further that, for all purposes of this Surety Bond, any Demand for
Payment or any Demand for Avoided Payment, any court-ordered or legally
required release, reduction, amendment or termination of the AMBAC Surety Bond
or the AMBAC Sublease Surety Bond shall not be considered voluntary unless such
court order was requested or consented to by the Owner Participant, the Owner
Trustee or the Co-Trustee.

 

(e)                                  Except as otherwise
provided in paragraph 11(d) above, BERKSHIRE WAIVES ALL OTHER RIGHTS,
BENEFITS AND DEFENSES UNDER APPLICABLE LAW THAT WOULD, BUT FOR THIS
PARAGRAPH 11(e), BE AVAILABLE TO BERKSHIRE AS A DEFENSE AGAINST OR A
REDUCTION OR LIMITATION OF ITS OBLIGATIONS UNDER THIS SURETY BOND (without
prejudice to Berkshire’s right to assert such rights, benefits or defenses in a
separate action unrelated to any action for enforcement of this Surety 

 

 

Bond
or the Covered Obligations, so long as Berkshire does not set-off the amount of
such rights, benefits or defenses against its obligation to pay Covered
Obligations hereunder).

 

(f)                                    (i)                                     Berkshire agrees, and each of the Guaranteed Parties by
acceptance of this Surety Bond and by submission of the Demand for Payment or
Demand for Avoided Payment hereunder with respect to a Deficiency or an Avoided
Payment, as the case may be, agrees, that concurrently upon the payment in full
by Berkshire of such Deficiency or Avoided Payment and the balance of the Total
Outstanding Amount (as defined in the Demand for Payment or Demand for Avoided
Payment) (whether or not in excess of the Surety Bond Coverage, “Payment in
Full”), Berkshire shall, subject to clause (ii) below, be subrogated
to all of the rights and remedies of the Head
Lessee and the Owner Participant (subject to the rights of the Lender as
provided in the Loan Agreement and other than those rights to which AMBAC had
previously been subrogated in accordance with the terms of the AMBAC Surety
Documents and the Implementation Agreement) with respect to the Covered
Obligations giving rise to such Deficiency or Avoided Payment and/or comprising
the balance of the Total Outstanding Amount under the Participation Agreement
and the other Operative Documents and all right, title and interest of the Head
Lessee, the Facility Lessor, the Facility Sublessor (to the extent previously
assigned to the RMLC Assignee) and the RMLC
Assignee (as defined in the Sublease Surety Bond) under the Operative Documents
(other than, in each and every case, Excluded Rights).

 

(ii)                                  Upon Payment in
Full, each of the Head Lessee and the Owner
Participant shall cooperate as reasonably requested by Berkshire, at
Berkshire’s expense, in Berkshire’s exercise of the subrogation and other
rights contemplated by paragraph 11(a) and this paragraph 11(f) as
may be reasonably necessary to carry out more effectively the intent and
purpose of such subrogation and other rights; provided, however,
that neither the Owner Participant nor the Head Lessee shall be required by
this sentence to take any action that (A) may expose it to criminal or
unindemnified civil liability or (B) that would reasonably be expected to
have a material adverse effect on the Owner Participant to the extent not
indemnified by Berkshire.  Upon the
request of Berkshire after Payment in Full, the Head Lessee and the Owner
Participant shall confirm the transfer of such rights to Berkshire by executing
an instrument substantially in the form of Attachment V.  Without limiting the foregoing, from and
after delivery of a Demand for Payment or Demand for Avoided Payment, (A) neither
the Head Lessee nor the Owner Participant shall
take any action with respect to enforcement of AMBAC’s obligations under the
AMBAC Surety Bond or the AMBAC Sublease Surety Bond with respect to any Claimed
Amount that is unpaid thereunder (in each case except for any such action as
may be reasonably requested by Berkshire), and Berkshire shall be entitled to
control and direct the exercise of all remedies (including but not limited to
all proceedings and settlements) in respect of the AMBAC Surety Bond and the
AMBAC Sublease Surety Bond with respect to any such Claimed Amount, through
counsel of Berkshire’s choice, and in each case without any duty or liability
to the Guaranteed Parties for any actions taken or not taken in connection
therewith, and (B) if Payment in Full has been made (and not avoided under
any bankruptcy or insolvency proceeding), except as specified in the next
following sentence, neither the Head Lessee
nor the Owner Participant shall take any action (other than any action
that the Head Lessee or the Owner 

 

 

Participant is required to take under the
Operative Documents) with respect to enforcement of the Covered Obligations
under the Head Lease, the Facility Sublease, the Participation Agreement or any
other Operative Documents without the prior written consent of Berkshire (other
than, in each and every case, Excluded Rights), and, subject to the rights of
the Lender as provided in the Loan Agreement, Berkshire shall be entitled to
control and direct the exercise of remedies (including but not limited to all
proceedings and settlements) in respect of Covered Obligations (other than with
respect to Excluded Rights) through counsel of Berkshire’s choice; provided
that any amounts recovered or realized by Berkshire pursuant to the exercise of
the subrogation rights set forth in this paragraph 11(f), and in any case
excluding any such rights in respect of the AMBAC Surety Bond or the AMBAC
Sublease Surety Bond, shall be first applied and paid over to the Guaranteed
Parties to discharge any and all unpaid obligations of Oglethorpe to such
Persons under the Operative Documents, prior to any application of such amounts
to any amounts owing to Berkshire with respect to payments made under this Surety
Bond or other payments in respect of Oglethorpe’s obligations.  In the event that, following any Payment in
Full, any amount paid by or on behalf of Oglethorpe or AMBAC to the Head Lessee
or the Owner Participant that shall have been taken into account in computing
the Total Outstanding Amount shall become an Avoided Payment, notwithstanding
the next preceding sentence, the Head Lessee or Owner Participant, as
applicable, may enforce its claim against Oglethorpe or AMBAC, after
consultation with Berkshire and in continued consultation with Berkshire in
order to avoid inefficient prosecution of the respective claims of Berkshire
and the Head Lessee or Owner Participant, as applicable, with respect to that
portion of such amount that shall remain unpaid after the maximum amount of the
Surety Bond Coverage shall have been drawn hereunder, provided, that any
recovery by the Head Lessee or the Owner Participant pursuant to such exercise
in excess of the amount required to discharge any unpaid obligations of Oglethorpe
or AMBAC to such Persons under the Operative Documents shall be paid over to
Berkshire for application to any unpaid Berkshire Obligations (as defined in
the Implementation Agreement).  For the
avoidance of doubt, no amounts recovered or realized by Berkshire from the
exercise by Berkshire of its rights pursuant to the Berkshire Guaranty
Agreement (P1) dated the date hereof between Oglethorpe and Berkshire or
(following payment in full of the Deficiency (as defined in the Demand for
Payment) or any amount due pursuant to a Demand for Avoided Payment and any
interest payable hereunder) in respect of the AMBAC Surety Bond or the AMBAC
Sublease Surety Bond, shall be subject to the order of distribution set forth
in the penultimate sentence of this paragraph 11(f)(ii) or any other
rights of the Guaranteed Parties.

 

(iii)                               The existence
of the subrogation rights in paragraph 11(a) hereof or this
paragraph 11(f) shall not in any way give rise to any duty on the
part of Berkshire, except as expressly set forth in such paragraph 11(a) or
this paragraph 11(f).

 

(iv)                              Nothing in
paragraph 11(a) or this paragraph 11(f) shall be construed to be a
representation on the part of the Owner Participant or Head Lessee as to the 

 

 

existence or extent of the right, title,
interest and remedies to which Berkshire shall be subrogated pursuant to such
paragraphs, except as expressly set forth in the Assignment (substantially in
the form of Exhibit A to the Demand for Avoided Payment) or the
Confirmation of Transfer (substantially in the form of Attachment V) in respect
of the Owner Participant’s and Head Lessee’s not having assigned any of the
same (other than, in the case of the Owner Participant, the grant to AMBAC of
the AMBAC Purchase Option and the grant to Berkshire of the Berkshire Purchase
Option and, in the case of the Head Lessee, the grant to the Lender of a
security interest in such Covered Obligations and other rights under and as
provided by the Loan Agreement and other than any assignment or grant of
subrogation rights required under the terms of the AMBAC Surety Documents) and
as to the absence of Owner Participant’s Liens and Facility Lessor’s Liens, as
the case may be.

 

12.                                 In addition to
Berkshire’s obligations under paragraph 1 hereof, Berkshire agrees to pay on demand all fees and out of pocket expenses
(including the reasonable fees and expenses of the Head Lessee’s counsel and
the Owner Participant’s counsel) in any way relating to the enforcement of the
rights of the Head Lessee or the Owner Participant hereunder or as
otherwise specified under the Surety Bond Documents (as defined in the
Agreement Regarding Surety Bonds (P1) dated the date hereof among Oglethorpe,
RMLC and Berkshire); provided, that, except as expressly set forth in the
Surety Bond Documents, Berkshire shall not
be liable for any expenses of the Head Lessee or the Owner Participant if no
payment under this Surety Bond is or was at any time due or if all payments are
made in accordance with the terms hereof.

 

13.                                 Each of the rights and remedies of the Head Lessee or the Owner
Participant under this Surety Bond shall be in addition to all of its other
rights and remedies under Applicable Law, and nothing in this Surety Bond shall
be construed as limiting any such rights or remedies.

 

14.                                 Any term, covenant, agreement or condition of this Surety Bond may be
amended, and any right under this Surety Bond may be waived, if, but only if,
such amendment or waiver is in writing and is signed by the Head Lessee and the
Owner Participant and, in the case of an amendment, by Berkshire.  No election not to exercise, failure to
exercise or delay in exercising any right, nor any course of dealing or
performance, shall operate as a waiver of any right of the Head Lessee or the
Owner Participant under this Surety Bond or Applicable Law, nor shall any
single or partial exercise of any such right preclude any other or further
exercise thereof or the exercise of any other right of the Head Lessee or the
Owner Participant under this Surety Bond or Applicable Law.

 

15.                                 (a) Prior to payment of all amounts payable by Berkshire hereunder,
Berkshire may not assign any of its rights or obligations under this Surety
Bond without the prior written consent of the Head Lessee and the Owner
Participant, and (b) no assignment of any such obligation shall release
Berkshire therefrom unless Head Lessee and the Owner Participant shall have
consented to such release in a writing specifically referring to the obligation
from which Berkshire is to be released; provided, however, that Berkshire may
procure any other surety to reinsure this Surety Bond.

 

 

16.                                 THIS SURETY BOND AND ANY BREACH OR DISPUTE WITH RESPECT TO THIS SURETY
BOND SHALL, PURSUANT TO NEW YORK GENERAL OBLIGATIONS LAW SECTION 5-1401,
BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK.

 

17.                                 Any provision of this Surety Bond that is prohibited or unenforceable in
any jurisdiction shall, as to such jurisdiction, be ineffective to the extent
of such prohibition or unenforceability without invalidating the remaining
provisions hereof or affecting the validity or enforceability of such provision
in any other jurisdiction.  To the extent
permitted by Applicable Law, Berkshire hereby waives any provision of Applicable
Law that renders any provision of this Surety Bond prohibited or unenforceable
in any respect.

 

18.                                 All of the provisions of this Surety Bond shall be binding upon Berkshire
and its successors and assigns and shall inure to the benefit of, and may be
enforced by, each of the Head Lessee and the Owner Participant and their
respective successors and permitted assigns under the provisions of the
Operative Documents.

 

19.                                 This Surety Bond may be assigned and transferred by the Head Lessee or
the Owner Participant to any successor or permitted assigns under the
provisions of the Operative Documents of the Head Lessee or the Owner
Participant upon delivery to Berkshire of a certificate of an authorized
officer of the applicable transferor and the transferee notifying Berkshire of
such transfer.

 

[Remainder of Page Intentionally
Left Blank]

 

 

IN WITNESS WHEREOF, Berkshire
has caused this Surety Bond to be executed on its behalf this 22nd day of May,
2009.

 

	
   

  	
  BERKSHIRE HATHAWAY ASSURANCE CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

Acknowledged and Consented to by:

 

	
  OGLETHORPE POWER CORPORATION

  	
   

  
	
  (AN ELECTRIC MEMBERSHIP CORPORATION)

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
  Date:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  [corporate seal]

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Attest:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
  Date:

  	
   

  

 

 

Exhibit A

 

Recipients of Notice of
Termination on behalf of Owner Participant:

 

1.                                       Alex T. Russo

Vice
President

Asset
and Portfolio Management

Philip
Morris Capital Corporation

225
High Ridge Road, Suite 300 West

Stamford,
Connecticut 06905

Telephone
No.:  (203) 708-8204

Alex.Russo@us.pm.com

 

2.                                       John M. Spera

Vice
President, and Controller

Philip
Morris Capital Corporation

225
High Ridge Road, Suite 300 West

Stamford,
Connecticut 06905

John.Spera@us.pm.com

Telephone
No.:  (203) 708-8155

 

3.                                       Steven P.
Seagriff

Vice
President

Pricing,
Compliance, and Credit

Philip
Morris Capital Corporation

225
High Ridge Road, Suite 300 West

Stamford,
Connecticut 06905

Telephone
No.:  (203) 708-8214

Steve.Seagriff@us.pm.com

 

4.                                       Douglas B.
Levene

Vice
President, General Counsel, and Secretary

Philip
Morris Capital Corporation

225
High Ridge Road, Suite 300 West

Stamford,
Connecticut 06905

Telephone
No.:  (203) 708-8347

Doug.Levene@us.pm.com

 

 

Schedule A

 

Oglethorpe
Power Corporation - Surety Bond Calculation

 

RMLC
Trust P1

 

	
  Period Starting

  and Including Date

  	
   

  	
  Period Ending and

  Including the Business

  Day Next Following

  Date

  	
   

  	
  Surety Bond Coverage

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  [05/22/09]

  	
   

  	
  [          ]

  	
   

  	
   

  
	
  *

  	
   

  	
  [          ]

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  [to come]

  	
   

  	
   

  

 

* Date next following ending date of next preceding
period described in this Schedule A.

 

 

Attachment I

(Head Lease-P1)

Surety Bond No. 98SRD102494

 

DEMAND
FOR PAYMENT

 

[Date]

 

Berkshire
Hathaway Assurance Corporation

[                                                                  ]

[                                                                  ]

[                                                                  ]

 

Reference is made to the Surety
Bond (Head Lease-P1) No. 98SRD102494 (the “Surety Bond”) issued by
Berkshire Hathaway Assurance Corporation (“Berkshire”).  The terms which are capitalized herein and
not otherwise defined have the meanings specified in the Surety Bond unless the
context otherwise requires.

 

The Head Lessee and the Owner
Participant hereby certify that:

 

(a)                                  [Either (i) at least two Business Days prior to the date of this Demand
for Payment, the Head Lessee or the Owner Participant demanded in writing (such
demand being the “Oglethorpe Payment Demand”) payment from Oglethorpe of
the Termination Value under the Head Lease or the Oglethorpe Portion of Equity
Termination Value, together with other amounts constituting Covered Obligations
under the Operative Documents, in an aggregate amount equal to
$[                    ]
(the “Amount Due”), and such amount was then and as of the date of this
Demand for Payment continues to be due and payable, or (ii) for a
period of at least two Business Days prior to the date of delivery of this
Demand for Payment to Berkshire, the Head Lessee or the Owner Participant has
been and continues to be stayed (as a consequence of an Insolvency Proceeding
pertaining to the insolvency of Oglethorpe) or has been and continues to be
otherwise legally prohibited from making an Oglethorpe Payment Demand, and but
for the existence of such stay or other prohibition, the Head Lessee or the
Owner Participant would have been entitled to make such Oglethorpe Payment
Demand and the Amount Due would thereupon have become due and payable by
Oglethorpe] / [AMBAC has paid the first Surety Bond Payment Amount].

 

(b)                                 Either (i)(A) at least one Business Day prior to the date of
this Demand for Payment, (1) the Head Lessee and the Owner Participant
demanded in writing (such demand being the “AMBAC Payment Demand”)
payment from AMBAC of the unpaid portion of the Amount Due or, if less, the
maximum amount then payable under the AMBAC Surety Bond (the amount demanded
under the AMBAC Surety Bond being the “AMBAC Claimed Amount”) under and
in compliance with the terms of the AMBAC Surety Bond, and (2) all or any
portion of the AMBAC Claimed Amount was then due and payable under the terms of
the AMBAC Surety Bond, and (B) such AMBAC Claimed Amount or any portion
thereof remains unpaid (the lesser of the Amount Due and the portion of the
AMBAC Claimed Amount that remains unpaid being the “Claimed Amount”), or
(ii) for a period of at least one Business Day prior to the date of
delivery of this Demand for Payment, the Head Lessee or the Owner Participant
has been and 

 

 

continues to be stayed
(as a consequence of an Insolvency Proceeding pertaining to the insolvency of
AMBAC) or has been and continues to be otherwise legally prohibited from making
an AMBAC Payment Demand, and but for the existence of such stay or other
prohibition, the Head Lessee or the Owner Participant would have been entitled
to make such AMBAC Payment Demand and the AMBAC Claimed Amount or the
applicable Surety Bond Payment Amount then payable under the AMBAC Surety Bond
would thereupon have become due and payable by AMBAC.

 

(c)                                  The Head Lessee or the Owner Participant has delivered to Berkshire (i) at
least two Business Days prior to the date of this Demand for Payment, either a
copy of the Oglethorpe Payment Demand or written notice that delivery thereof
has been stayed or otherwise prohibited as contemplated above, unless AMBAC has
paid the first Surety Bond Payment Amount, in which case the delivery referred
to in this clause (i) is not required, and (ii) at least one Business
Day prior to the date of this Demand for Payment, either a copy of the AMBAC
Payment Demand or written notice that delivery thereof has been stayed or
otherwise prohibited as contemplated above.

 

(d)                                 As of the date of this Demand for Payment, (i) $[              ]
(exclusive of interest and expenses) (the “Oglethorpe Payment”) has been
paid to the Head Lessee or the Owner Participant by or on behalf of Oglethorpe
with respect to the Amount Due and/or to or for the account of the Facility
Lessor in respect of the Termination Value under the Head Lease and/or the
Oglethorpe Portion of Equity Termination Value, and (ii) $[              ]
(exclusive of interest and expenses) (the “AMBAC Payment”) has been paid
to the Head Lessee or the Owner Participant by AMBAC under the AMBAC Surety
Bond and/or the AMBAC Sublease Surety Bond, (iii) $[          ]
has been paid and/or is the subject of a simultaneous outstanding demand for
payment under the Sublease Surety Bond (the “Sublease Surety Bond Amount”);
and (iv) $[          ]
(the “Avoided Payments”) of any such Oglethorpe Payment or AMBAC Payment
has been returned or turned over as an avoided payment to Oglethorpe or AMBAC,
respectively, or any other person by the Head Lessee or the Owner Participant
as a result of an Avoidance Event in respect of any payment made by Oglethorpe
under the Head Lease or AMBAC under the AMBAC Surety Bond.

 

(e)                                  (i)  As of
the date hereof, the Covered Obligations
that are (x) due and payable by Oglethorpe under the terms of the Head
Lease, the Participation Agreement or any of the other Operative Documents
(other than the Facility Lease or the Facility Sublease), or are payable upon
demand but cannot be demanded from, Oglethorpe pursuant to the terms of the
Head Lease, the Participation Agreement or any of the other Operative Documents
(other than the Facility Lease or the Facility Sublease) by reason of the
operation of a stay or other order issued in an Insolvency Proceeding
pertaining to the insolvency of Oglethorpe, and, giving effect to the
application of the Oglethorpe Payment (less the amount of any Avoided Payment
with respect thereto), the AMBAC Payment (less the amount of any Avoided
Payment with respect thereto) and the Sublease Surety Bond Amount, have not
been paid, and (y) due and payable by AMBAC under the terms of the AMBAC
Surety Bond, or the present payment of which cannot be demanded from AMBAC
under the terms of the AMBAC Surety Bond by reason of the operation of a stay
or other order issued in an Insolvency Proceeding pertaining to the insolvency
of AMBAC, and have not been paid, are specified in the attachment hereto and
are in the aggregate, without duplication,
$[              ]
(the “Head Lease Outstanding Amount”).

 

 

(ii)                                  The Surety Bond Coverage is
$[              ].

 

(iii)                               The lesser of the Head Lease Outstanding Amount and the Surety Bond
Coverage is
$[              ]
(the “Deficiency”).

 

(iv)                              As of the date hereof, the Sublease Outstanding Amount (as defined in the
Sublease Surety Bond) is specified in an attachment hereto and is
$[              ].

 

(v)                                 The sum of the Head Lease Outstanding Amount and of the Sublease
Outstanding Amount, (taking into account any provision of the Operative
Documents pursuant to which payment of amounts comprising the Head Lease
Outstanding Amount are deemed to pay and satisfy other amounts comprising the
Head Lease Outstanding Amount or the Sublease Outstanding Amount, and vice  versa), is
specified in an attachment hereto and is
$[                  ]
(the “Total Outstanding Amount”).

 

(f)                                    Neither the Head Lessee nor the Owner Participant has been paid all or
any part of the Deficiency by Berkshire; and neither the AMBAC Surety Bond nor
the AMBAC Sublease Surety Bond has been voluntarily released by the undersigned
or the Owner Trustee or terminated by voluntary agreement of the undersigned or
the Owner Trustee.

 

(g)                                 Neither Ambac nor any Affiliate of AMBAC has become the Owner
Participant or is a party to any contract or arrangement (other than the AMBAC
Documents) with the Owner Participant or any Affiliate thereof or the Owner
Trustee pursuant to which AMBAC or any such Affiliate of AMBAC shall have
acquired or shall (other than as provided in the AMBAC Documents) have the
right to acquire all or substantially all of the economic benefits attributable
to the Beneficial Interest, the Trust Estate or the Leasehold Interest or any
substantial part thereof or interest therein.

 

The Head Lessee and the Owner Participant hereby request
that payment of the Deficiency be made by Berkshire under the Surety Bond and
direct that payment under the Surety Bond be made to the following account by
bank wire transfer of federal or other immediately available funds in
accordance with the terms of the Surety Bond:

 

Account Information:

 

 

 

 

 

 

U.S. Bank National Association, 

not in its individual capacity, 

but solely as Co-Trustee

 

	
  By:

  	
   

  	
   

  
	
  Title:

  	
   

  

 

 

Philip Morris Capital Corporation

 

	
  By:

  	
   

  	
   

  
	
  Title:

  	
   

  

 

 

Attachment II

(Head Lease-P1)

Surety Bond No. 98SRD102494

 

DEMAND
FOR AVOIDED PAYMENT

 

[Date]

 

Berkshire
Hathaway Assurance Corporation

[                                                                  ]

[                                                                  ]

[                                                                  ]

 

Reference is made to the Surety
Bond (Head Lease-P1) No. 98SRD102494 (the “Surety Bond”) issued by
Berkshire Hathaway Assurance Corporation (“Berkshire”).  The terms which are capitalized herein and
not otherwise defined have the meanings specified in the Surety Bond unless the
context otherwise requires.

 

The Head Lessee and the Owner
Participant hereby certify that:

 

(a)                                  An Avoidance Event has occurred under an Insolvency Proceeding with
respect to [Oglethorpe or AMBAC], and, as a result of such Avoidance Event, the
Head Lessee or the Owner Participant is required to return or turn over an
Avoided Payment in the amount of $[            ]
(the “Avoided Payment”).

 

(b)                                 Berkshire has not heretofore made a payment of the maximum amount of the
Surety Bond Coverage to the Head Lessee or the Owner Participant.

 

(c)                                  Attached hereto is a certified copy of an order of a court or other body
exercising jurisdiction in such Insolvency Proceeding to the effect that the
Head Lessee or the Owner Participant is required to return or pay over such
Avoided Payment because such Avoided Payment was avoided as a preferential
transfer or otherwise rescinded or required to be restored by the Head Lessee
or the Owner Participant (the “Order”).

 

(d)                                 The Order has been entered and is not subject to any stay, and the Head
Lessee or the Owner Participant, as the case may be, has complied with or will
timely comply with such order.

 

(e)                                  The Owner Participant and the Head Lessee have delivered to Berkshire an
assignment, in substantially the form of Exhibit A.

 

(f)                                    If the Avoided Payment is an Oglethorpe Avoided Payment, either (i)(A) at
least one Business Day prior to the date of this Demand for Avoided
Payment, (1) the Head Lessee or the Owner Participant demanded in writing
(such demand being the “AMBAC Avoided Payment Demand”) payment from
AMBAC of the Avoided Payment or, if less, the maximum amount then payable under
the AMBAC Surety Bond (the amount demanded under the AMBAC Surety Bond being
the “AMBAC Claimed Amount”) under and in compliance with the terms of
the 

 

 

AMBAC Surety Bond, and (2) all
or any portion of the AMBAC Claimed Amount was then due and payable under the
terms of the AMBAC Surety Bond, and (B) such AMBAC Claimed Amount or any
portion thereof remains unpaid (the lesser of the Oglethorpe Avoided Payment
and the portion of the AMBAC Claimed Amount that remains unpaid being the “Berkshire
Claimed Amount”), or (ii) for a period of at least one Business Day
prior to the date of delivery of this Demand for Avoided Payment, the [Head
Lessee] / [Owner Participant] has been and continues to be stayed (as a
consequence of an Insolvency Proceeding pertaining to the insolvency of AMBAC)
or has been and continues to be otherwise legally prohibited from making an
AMBAC Avoided Payment Demand, and but for the existence of such stay or other
prohibition, the [Head Lesse] / [Owner Participant] would have been entitled to
make such AMBAC Avoided Payment Demand and the AMBAC Claimed Amount or the
applicable Surety Bond Payment Amount then payable under the AMBAC Surety Bond
would thereupon have become due and payable by AMBAC.

 

(g)                                 Neither the Head Lessee nor the Owner Participant has been paid all or
any part of the Avoided Payment by Berkshire; neither the AMBAC Surety Bond nor
the AMBAC Sublease Surety Bond has been voluntarily released by the undersigned
or the Owner Trustee or terminated by voluntary agreement of the undersigned or
the Owner Trustee.

 

(H)                 NEITHER
AMBAC NOR ANY AFFILIATE OF AMBAC HAS BECOME THE OWNER PARTICIPANT OR IS A
PARTY TO ANY CONTRACT OR ARRANGEMENT (OTHER THAN THE AMBAC DOCUMENTS) WITH THE
OWNER PARTICIPANT OR ANY AFFILIATE THEREOF OR THE OWNER TRUSTEE PURSUANT TO
WHICH AMBAC OR ANY SUCH AFFILIATE OF AMBAC SHALL HAVE ACQUIRED OR SHALL (OTHER
THAN AS PROVIDED IN THE AMBAC DOCUMENTS) HAVE THE RIGHT TO ACQUIRE ALL OR
SUBSTANTIALLY ALL OF THE ECONOMIC BENEFITS ATTRIBUTABLE TO THE BENEFICIAL
INTEREST, THE TRUST ESTATE OR THE LEASEHOLD INTEREST OR ANY SUBSTANTIAL PART THEREOF
OR INTEREST THEREIN.

 

The Head Lessee and the Owner Participant hereby request
Berkshire to pay the amount of (x) if the Avoided Payment is an Oglethorpe
Avoided Payment, the Berkshire Claimed Amount or (y) if the Avoided
Payment is an AMBAC Avoided Payment, the sum of, without duplication, such
Avoided Payment plus that portion of the Claimed Amount (as defined in the
AMBAC Surety Bond) remaining unpaid as of the date hereof, in each case out of
the funds of Berkshire, when the applicable Avoided Payment is due to be paid
pursuant to the Order, provided that the amount of the payment requested
hereunder, when added to all other payments made under the Surety Bond, the
Sublease Surety Bond and (to the extent not the subject of an Avoidance Event)
the AMBAC Surety Bond, shall not exceed the applicable Surety Bond Coverage; provided
further, that Berkshire shall not be required to make such payment
earlier than the second Business Day following receipt by Berkshire of this
Demand for Avoided Payment and all attachments referred to herein.  Such payment shall be disbursed to the
receiver, conservator, debtor-in-possession or trustee in bankruptcy named in
the Order, and not to the Head Lessee or the Owner Participant directly, unless
and only to the extent the Head Lessee or the Owner Participant has made a
payment of the Avoided Payment to the court or such receiver, conservator,
debtor-in-possession or trustee in bankruptcy named in the Order, in which case
Berkshire will pay the Head Lessee or the Owner Participant, as applicable,
subject to the 

 

 

delivery of evidence satisfactory to Berkshire that such
payment has been made to such court or receiver, conservator,
debtor-in-possession or trustee in bankruptcy named in the Order.

 

U.S. Bank National Association,

not in its individual capacity,

but solely as Co-Trustee

 

	
  By:

  	
   

  	
   

  
	
  Title:

  	
   

  
	
   

  
	
  Philip Morris Capital
  Corporation

  
	
   

  
	
  By:

  	
   

  	
   

  
	
  Title:

  	
   

  

 

 

Exhibit A

to

Demand for Avoided Payment

 

ASSIGNMENT

 

Reference
is made to the Participation Agreement (P1)
dated as of December 30, 1996, by and among (a) Oglethorpe Power
Corporation (An Electric Membership Corporation) (“Oglethorpe”), (b) Rocky
Mountain Leasing Corporation (“RMLC”), (c) U.S. Bank National
Association, successor in interest to SunTrust Bank, Atlanta, as Co-Trustee
(together with its successors and assigns, the “Head Lessee”) under the
Rocky Mountain Head Lease Agreement (P1) dated as of December 30, 1996 by
and between Oglethorpe and the Head Lessee, (d) U.S. Bank National
Association, successor in interest to Fleet National Bank, as Owner Trustee (e) Philip
Morris Capital Corporation (the “Owner Participant”), and (f) Utrecht-America
Finance Co. (as amended, modified, supplemented and in effect from time to time,
the “Participation Agreement”. 
Capitalized terms used herein and not otherwise defined are used herein
as defined in the Participation Agreement.

 

FOR
VALUE RECEIVED, each of the Owner Participant and the Head Lessee hereby
irrevocably assigns and transfers to Berkshire Hathaway Assurance Corporation
(the “Assignee”), (subject to (x) the rights of the Lender as
provided in the Loan Agreement, (y) any right, title and interest that
shall have been assigned to AMBAC, or to which AMBAC shall have been subrogated,
in accordance with the terms of the Implementation Agreement, the AMBAC Surety
Bond and the AMBAC Sublease Surety Bond and (z) the provisions of
paragraph 11(f) of the Surety Bond), all rights and claims other than
Excluded Rights (collectively, the “Assigned Rights”) of the Head Lessee
and the Owner Participant relating to or arising under the Operative Documents
against [AMBAC Assurance Corporation] [Oglethorpe] or the estate thereof or
otherwise with respect to the Avoided Payment [and that portion of the Claimed
Amount (as defined in the AMBAC Surety Bond) remaining unpaid as of the date of
the Demand for Avoided Payment relating to such Avoided Payment](1) described
below.  The Owner Participant represents and warrants that it has not
assigned the Assigned Rights or any interest therein or other rights relating
thereto to any other Person (subject to any right, title and interest that
shall have been assigned to AMBAC, or to which AMBAC shall have been
subrogated, in accordance with the terms of the Implementation Agreement, the
AMBAC Surety Bond and the AMBAC Sublease Surety Bond) and that no Owner
Participant’s Lien exists thereon.  The
Head Lessee represents and warrants
that it has not assigned such Assigned Rights or any interest therein or other
rights to relating thereto to any other Person (other than any grant to the
Lender of a security interest in any Assigned Rights or any interest therein or
other rights relating thereto under and as provided by the Loan Agreement and
subject to any right, title and interest that shall have been assigned to
AMBAC, or to which AMBAC shall have been subrogated, in accordance with the
terms of the Implementation Agreement, the AMBAC Surety Bond and the AMBAC
Sublease Surety Bond) and that no Facility Lessor’s Lien exists thereon.

 

(1) Omit
if assignment relates to an Oglethorpe Avoided Payment.

 

 

The
Avoided Payment [and portion of the Claimed Amount](2) covered by this
Assignment is described as follows: 
[                ](3).

 

It
is expressly understood and agreed that (a) this Assignment is executed
and delivered by U.S. Bank National Association, not individually or personally
but solely as Co-Trustee and Head Lessee, (b) any representation,
undertaking or agreement herein made on the part of the Head Lessee is made and
intended not as a personal representation, undertaking and agreement by U.S.
Bank National Association and (c) under no circumstances shall U.S. Bank
National Association be personally liable for the payment of any indebtedness
or expenses of the Head Lessee or be liable for the breach or failure of any
obligation, representation, warranty or covenant made or undertaken by Head
Lessee hereunder.

 

U.S. Bank National Association, 

not in its individual capacity, 

but solely as Co-Trustee

 

	
  By:

  	
   

  	
   

  
	
  Title:

  	
   

  

 

Philip Morris Capital Corporation

 

	
  By:

  	
   

  	
   

  
	
  Title:

  	
   

  

 

(2)     Omit if assignment relates
to an Oglethorpe Avoided Payment.

(3)     Include date of original
payment(s), amounts paid, date of repayment, date repaid, and interest and
other amounts constituting a part thereof. 
If assignment relates to an AMBAC Avoided Payment, include original
Claimed Amount under AMBAC Surety Bond, date of demand therefor, and dates and
amounts of payments (net of any AMBAC Avoided Payments) made with respect
thereto.

 

 

Attachment III

(Head Lease-P1)

Surety Bond No. 98SRD102494

 

NOTICE
OF TERMINATION

 

[Date]

 

U.S.
Bank National Association, as Co-Trustee

[                                                                  ]

[                                                                  ]

[                                                                  ]

 

Philip
Morris Capital Corporation

[                                                                  ]

[                                                                  ]

[                                                                  ]

 

Reference is made to the Surety Bond (Head Lease-P1) No. 98SRD102494
(the “Surety Bond”) issued by Berkshire Hathaway Assurance Corporation (“Berkshire”).  The terms which are capitalized herein and
not otherwise defined have the meanings specified in the Surety Bond unless the
context otherwise requires.

 

Berkshire hereby notifies the Head Lessee and the Owner
Participant that (a) Berkshire has not received the portion of the Premium
due and payable in respect of the Surety Bond on
[                                  ]
in the amount of
$[                  ]
(the “Unpaid Premium Amount”) and (b) as a result of such
non-payment, the Surety Bond will terminate effective 80 days after the date of
this notice (the “Cure Period”) unless Berkshire receives full payment
of the Unpaid Premium Amount prior to the expiration of the Cure Period.

 

Berkshire Hathaway Assurance Corporation

 

	
  By:

  	
   

  	
   

  
	
  Title:

  	
   

  

 

 

Attachment IV

(Head Lease-P1)

Surety Bond No. 98SRD102494

 

NOTICE OF TERMINATION COVER SHEET

(on red paper)

 

URGENT

 

THIS IS A NOTICE OF TERMINATION TO TERMINATE SURETY BOND POLICY NO.
98SRD102494.  PLEASE READ AND RESPOND.

 

THIS MAY BE AN EVENT OF DEFAULT.

 

 

Attachment V

(Head Lease-P1)

Surety Bond No. 98SRD102494

 

CONFIRMATION OF TRANSFER

 

Reference is made to the Participation Agreement (P1)
dated as of December 30, 1996, by and among (a) Oglethorpe Power
Corporation (An Electric Membership Corporation) (“Oglethorpe”), (b) Rocky
Mountain Leasing Corporation (“RMLC”), (c) U.S. Bank National Association,
successor in interest to SunTrust Bank, Atlanta, as Co-Trustee (together with
its successors and assigns, the “Head Lessee”) under the Rocky Mountain Head
Lease Agreement (P1) dated as of December 30, 1996 by and between
Oglethorpe and the Head Lessee, (d) U.S. Bank National Association,
successor in interest to Fleet National Bank, as Owner Trustee (e) Philip
Morris Capital Corporation (the “Owner Participant”), and (f) Utrecht-America
Finance Co. (as amended, modified, supplemented and in effect from time to
time, the “Participation Agreement”. 
Capitalized terms used herein and not otherwise defined are used herein
as defined in the Participation Agreement or in the Surety Bond (Head Lease-P1)
No. 98SRD102494 issued by Berkshire Hathaway Assurance Corporation (the “Subrogee”).

 

FOR
VALUE RECEIVED, each of the Owner Participant and the Head Lessee hereby
irrevocably assigns and transfers to the Subrogee, and confirms the transfer
and assignment to the Subrogee, by subrogation or otherwise, of, all of the
rights, interests, claims and remedies of the Head Lessee and/or the Owner Participant with respect to the
Covered Obligations giving rise to any Deficiency or Avoided Payment and/or
comprising the balance of the Total Outstanding Amount (as defined in any
Demand for Payment or Demand for Avoided Payment) under the Participation
Agreement and the other Operative Documents and all right, title and interest
of the Head Lessee, the Facility Lessor, the Facility Sublessor (to the extent
previously assigned to the RMLC Assignee) and the RMLC Assignee (as defined in the Sublease Surety Bond) under
the Operative Documents (other than, in each and every case, Excluded Rights
and in each and every case, subject to (x) the rights of the Lender as
provided in the Loan Agreement, (y) any right, title and interest that
shall have been assigned to AMBAC, or to which AMBAC shall have been
subrogated, in accordance with the terms of the Implementation Agreement, the
AMBAC Surety Bond and the AMBAC Sublease Surety Bond and (z) the
provisions of paragraph 11(f) of the Surety Bond).  The Owner
Participant hereby represents and warrants that it has not assigned such
Covered Obligations or other rights to any other Person (other than the grant
to AMBAC of the AMBAC Purchase Option and the grant to Berkshire of the
Berkshire Purchase Option and that no Owner Participant’s Lien exists
thereon.  The Head Lessee represents and
warrants that it has not assigned such Covered Obligations or other rights to
any other Person (other than the grant to the Lender of a security interest in
such Covered Obligations and other rights under and as provided by the Loan
Agreement) and that no Facility Lessor’s Lien exists thereon.

 

 

It
is expressly understood and agreed that (a) this Confirmation of Transfer
is executed and delivered by U.S.
Bank National Association, not individually or personally but solely as
Co-Trustee and Head Lessee, (b) any representation, undertaking or agreement
herein made on the part of the Head Lessee is made and intended not as a
personal representation, undertaking and agreement by U.S. Bank National
Association and (c) under no circumstances shall U.S. Bank National
Association be personally liable for the payment of any indebtedness or
expenses of the Head Lessee or be liable for the breach or failure of any
obligation, representation, warranty or covenant made or undertaken by Head
Lessee hereunder.

 

U.S. Bank National Association, 

not in its individual capacity, 

but solely as Co-Trustee

 

	
  By:

  	
   

  	
   

  
	
  Title:

  	
   

  

 

Philip Morris Capital Corporation

 

	
  By:

  	
   

  	
   

  
	
  Title:

  	
   

  

 

 

EXHIBIT B

 

Form of Berkshire Sublease Surety Bond

 

SURETY
BOND

(Facility Sublease-P1)

 

Berkshire Hathaway Assurance Corporation

3024 Harney Street

Omaha, NE 68131

Facsimile No.:
(402) 916-3237

 

	
  Effective Date: May 22,
  2009

  	
  Policy
  No. 98SRD102495

  

 

Berkshire Hathaway Assurance Corporation
(together with its successors and permitted assigns, “Berkshire”), in
consideration of the payment to it on the date hereof and from time to time
hereafter of the premium payable in respect of this Surety Bond as separately
agreed between Berkshire and Oglethorpe Power Corporation (An Electric
Membership Corporation) (together with its successors and permitted assigns, “Oglethorpe”)
(such payment and any future payments of premium in respect of this Surety Bond
being collectively referred to as the “Premium”), receipt of which for
the amount of such premium payable on the date hereof is hereby acknowledged,
and subject to the terms of this Surety Bond, hereby unconditionally and
irrevocably guarantees to Rocky Mountain Leasing Corporation (together with its
successors and assigns, the “Facility Sublessor”) and U.S. Bank National
Association, successor in interest to SunTrust Bank, Atlanta, as Co-Trustee
(together with its successors and assigns, the “Facility Lessor”) as a
Secured Party under the Facility Sublease Assignment Agreement (the “RMLC
Assignee”) (collectively, the “Guaranteed Parties”), the full and
complete payment, without duplication, of (i) any and all amounts
of Termination Value and amounts computed by reference to Termination
Value under the Facility Sublease Agreement (P1) dated as of December 30,
1996 by and between Oglethorpe and the Facility Sublessor (as amended,
modified, supplemented and in effect from time to time, the “Facility
Sublease Agreement”), and (ii) all amounts payable by AMBAC Assurance
Corporation (formerly known as AMBAC Indemnity Corporation) (together with its
successors and permitted assigns, “AMBAC”) under the Amended and
Restated Surety Bond (Facility Sublease-P1) issued on May 22, 2009, Policy
No. SF0004BE (the “AMBAC Surety Bond”), executed by AMBAC in favor
of the Guaranteed Parties (all such amounts under clauses (i) and (ii) above,
together with any other payments due (or, if payable upon demand, that shall be
accrued and unpaid and, unless demand therefor shall have been stayed by
operation of law, shall have been duly demanded) at such time constituting
obligations of Oglethorpe under the Participation Agreement or the other
Operative Documents, being referred to as the “Covered Obligations”) as
at any time such payments are (1) in the case of clause (i) above,
due from Oglethorpe under the terms of the Facility Sublease, the Participation
Agreement or any of the other Operative Documents but shall not be so paid, or
are payable by, or the present payment of which are payable upon 

 

 

demand, and could be demanded from, Oglethorpe
pursuant to the terms of the Facility Sublease, the Participation Agreement or
any of the other Operative Documents absent the operation of a stay or other
order issued in an Insolvency Proceeding (as hereinafter defined) pertaining to
the insolvency of Oglethorpe, and have not been paid, or (2) in the case
of clause (ii) above, due from AMBAC under the terms of the AMBAC
Surety Bond and shall not be so paid, or are payable by, or the present payment
of which could be demanded from, AMBAC under the terms of the AMBAC Surety Bond
absent the operation of a stay or other order issued in an Insolvency
Proceeding pertaining to the insolvency of AMBAC, but have not been paid; provided
that, except in circumstances in which Payment in Full (as defined below) is
payable in accordance with the terms hereof, the amount available at any
particular time to be paid by Berkshire hereunder shall be not more than the
Deficiency computed as provided in the form of Demand for Payment annexed
hereto as Attachment I or the amount computed as provided in the form of Demand
for Avoided Payment (as defined below) annexed hereto as Attachment II, as
the case may be, and in either case not exceed (i) the Surety Bond
Coverage (as defined in paragraph 7 hereof), plus (ii) interest at
the Overdue Rate on any amounts due and payable by Berkshire hereunder from and
including the date such amounts are due and payable by Berkshire hereunder plus
(iii) expenses payable by Berkshire under paragraph 12 hereof.  Capitalized terms used herein or in any
Demand for Payment, Demand for Avoided Payment or Notice of Termination (as
defined below) but not defined herein or therein shall have the respective
meanings set forth in Appendix A to the Participation Agreement (P1), dated as
of December 30, 1996, by and among Oglethorpe, the Facility Sublessor, the
Facility Lessor, U.S. Bank National Association, successor in interest to Fleet
National Bank, as Owner Trustee and Utrecht-America Finance Co. (as amended,
supplemented or otherwise modified and in effect from time to time, the “Participation
Agreement”).  The general provisions
of such Appendix A shall apply to terms used in this Surety Bond and defined
herein or therein.

 

1.                                       Upon receipt by Berkshire of a demand for payment for a portion or all of
the unpaid amount of the Covered Obligations in an amount up to and including,
but not exceeding, the Surety Bond Coverage (the “Deficiency”) conforming to
and in the form attached hereto as Attachment I (a “Demand for Payment”),
with all blank spaces therein for variable information completed, duly executed
by the Facility Sublessor (subject to paragraph 20 hereof) or the RMLC
Assignee and certifying that:

 

(a)                                  either (i) at least two Business Days prior to the date of such
Demand for Payment, the Facility Sublessor or the RMLC Assignee demanded in
writing (such demand being the “Oglethorpe Payment Demand”) payment from
Oglethorpe of an amount (the “Oglethorpe Claimed Amount”) not less than
the Deficiency, and such Oglethorpe Claimed Amount was then due and payable and
as of the date of the Demand for Payment hereunder continues to be due and
payable, or (ii) for a period of at least two Business Days prior to
the date of delivery of the Demand for Payment hereunder, the Facility
Sublessor or the RMLC Assignee, as the case may be, has been and continues to
be stayed (as a consequence of an Insolvency Proceeding pertaining to the
insolvency of Oglethorpe or RMLC) or has been and continues to be otherwise
legally prohibited from making an Oglethorpe Payment Demand, and but for the 

 

 

existence of such stay
or other prohibition, the Facility Sublessor or the RMLC Assignee, as the case
may be, would have been entitled to make such Oglethorpe Payment Demand and the
Oglethorpe Claimed Amount would thereupon have become due and payable by
Oglethorpe; provided, however, that the certification set forth
in this clause (a) shall not be required in a Demand for Payment that
is made after payment of the first Surety Bond Payment Amount, and

 

(b)                                 either (i)(A) at least one Business Day prior to the date of
such Demand for Payment hereunder, (1) the Facility Sublessor or the RMLC
Assignee (whichever is then authorized to do so under the terms of the AMBAC
Surety Bond) demanded in writing (such demand being the “AMBAC Payment
Demand”) payment from AMBAC of the unpaid portion of the Oglethorpe Claimed
Amount or, if less, the maximum amount then payable under the AMBAC Surety Bond
(the amount demanded under the AMBAC Surety Bond being the “AMBAC Claimed
Amount”) under and in compliance with the terms of the AMBAC Surety Bond,
and (2) all or any portion of the AMBAC Claimed Amount was then due and
payable under the terms of the AMBAC Surety Bond, and (B) such AMBAC
Claimed Amount or any portion thereof remains unpaid, or (ii) for a period
of at least one Business Day prior to the date of delivery of the Demand for
Payment hereunder, the Facility Sublessor or the RMLC Assignee, as the case may
be, has been and continues to be stayed (as a consequence of an Insolvency
Proceeding pertaining to the insolvency of AMBAC) or has been and continues to
be otherwise legally prohibited from making an AMBAC Payment Demand, and but
for the existence of such stay or other prohibition, the Facility Sublessor or
the RMLC Assignee, as the case may be, would have been entitled to make such
AMBAC Payment Demand and the AMBAC Claimed Amount or the applicable Surety Bond
Payment Amount then payable under the AMBAC Surety Bond would thereupon have
become due and payable by AMBAC, and

 

(c)                                  the Facility Sublessor or the RMLC Assignee, as the case may be, has
delivered to Berkshire (i) at least two Business Days prior to the
date of such Demand for Payment, either a copy of the Oglethorpe Payment Demand
or written notice that delivery thereof has been stayed or otherwise prohibited
as contemplated above, except that no such certification or delivery shall be
required in a Demand for Payment made after payment of the first Surety Bond
Payment Amount, and (ii) at least one Business Day prior to the date of
such Demand for Payment, either a copy of the AMBAC Payment Demand or written
notice that delivery thereof has been stayed or otherwise prohibited as
contemplated above, and

 

(d)                                 as of the date of such Demand for Payment hereunder, a Deficiency exists,
and

 

(e)                                  neither Ambac nor any Affiliate of AMBAC shall have become the
Owner Participant or shall be a party to any contract or arrangement (other
than the AMBAC Surety Documents, the Implementation Agreement and, if
applicable, the Loan Agreement, the Loan Certificate and the Deed to Secure
Debt 

 

 

(collectively, the “AMBAC Documents”))
with the Owner Participant or any Affiliate thereof or the Owner Trustee pursuant
to which AMBAC or any such Affiliate of AMBAC shall have acquired or shall
(other than as provided in the AMBAC Documents) have the right to acquire all
or substantially all of the economic benefits attributable to the Beneficial
Interest, the Trust Estate or the Leasehold Interest or any substantial part
thereof or interest therein,

 

Berkshire will pay to the Facility Sublessor or the RMLC
Assignee (subject to paragraph 20 hereof, and as specified in such Demand for
Payment and at the place of payment set forth in such Demand for Payment), on
the Business Day following the date of receipt of such Demand for Payment, an
amount equal to the Deficiency (but in no event to exceed the Surety Bond
Coverage), in each case by wire transfer as specified in such Demand for
Payment.  Berkshire shall also pay
interest at the Overdue Rate on any amounts payable hereunder and on accrued
but unpaid interest thereon (to the extent permitted by law) from and including
the date such amounts are due and payable hereunder to (but excluding) the date
of payment.

 

2.                                       A Demand for Payment, Demand for Avoided payment, a copy of an Oglethorpe
Payment Demand (or written notice that delivery thereof has been stayed or
otherwise prohibited) delivered under clause (1)(c)(i) hereof, if
required hereunder, or a copy of an AMBAC Payment Demand (or written notice
that delivery thereof has been stayed or otherwise prohibited) delivered under
clause (1)(c)(ii) hereof shall be personally delivered or sent by
telecopy to Berkshire at Berkshire’s “Address for Notice” set forth in
paragraph 8 hereof.  Any Demand for
Payment, Demand for Avoided Payment or copy or notice pursuant to the next
preceding sentence so received by Berkshire after 2:00 p.m. New York City
time on any Business Day or on any day that is not a Business Day shall be
deemed to have been received by Berkshire prior to 2:00 p.m., New York
City time, on the next succeeding Business Day. 
As used herein, the term “Business Day” shall mean any day other than a
Saturday, a Sunday or any day on which banking institutions in New York, New
York are authorized or required by law to be closed.  If a Demand for Payment or Demand for Avoided
Payment made hereunder is not, in any instance, effected in accordance with the
terms and conditions of this Surety Bond, Berkshire shall give notice to the
Facility Sublessor or the RMLC Assignee, as applicable, as promptly as
reasonably practicable, that such Demand for Payment or Demand for Avoided
Payment, as the case may be, was not effected in accordance with the terms and
conditions of this Surety Bond and briefly state the reason(s) therefor.  Upon being notified that such Demand for
Payment or Demand for Avoided Payment was not effected in accordance with the
terms and conditions of this Surety Bond, the Facility Sublessor or the RMLC
Assignee, as the case may be, may attempt to correct any such nonconforming
Demand for Payment or Demand for Avoided Payment, as the case may be.  Multiple Demands for Payment or Demands for
Avoided Payment shall be permitted hereunder.

 

3.                                       [Intentionally omitted]

 

4.                                       Any service of process on Berkshire may be made to Berkshire at Berkshire’s
“Address for Notice” set forth in paragraph 8 hereof, and such service of
process shall be valid and binding as to Berkshire.

 

 

5.                                       This Surety Bond is noncancelable for any reason.  Subject to paragraph 6 below, this
Surety Bond and the obligations of Berkshire hereunder shall terminate on the
earliest of (i) so long as Berkshire is not in default with respect to any
of its obligations hereunder, January 11, 2027, (ii) two (2) days
after the Surety Bond Coverage is reduced to zero dollars, (iii) upon
receipt by Berkshire of written notice from the Facility Sublessor and the RMLC
Assignee stating that Berkshire is released from its obligations under this
Surety Bond, (iv) the date on which payment is made by Berkshire in full
of the amount required to be paid pursuant to a Demand for Payment, (v) except
with respect to coverage for Avoided Payments, the date on which payment is made
in full of all Covered Obligations of Oglethorpe or AMBAC or the date on which
Oglethorpe or AMBAC are released (in a writing signed by the RMLC Assignee or,
if the assignment by the Facility Sublessor of its rights hereunder to the RMLC
Assignee shall have been terminated, the Facility Sublessor) from further
liability in respect of all Covered Obligations, other than with the written
consent of Berkshire, (vi) the date, if any, on which Ambac or any
Affiliate of AMBAC shall have become the Owner Participant or shall be a party
to any contract or arrangement (other than the AMBAC Documents) with the Owner
Participant or any Affiliate thereof or the Owner Trustee pursuant to which
AMBAC or any such Affiliate of AMBAC shall have acquired or shall (other than
as provided in the AMBAC Documents) have the right to acquire all or
substantially all of the economic benefits attributable to the Beneficial
Interest, the Trust Estate or the Leasehold Interest or any substantial part
thereof or interest therein,  and (vii) 80 days (the “Cure Period”)
after the later of (x) the third Surety Bond Payment Date (as defined in
the AMBAC Surety Bond) if AMBAC paid the first Surety Bond Payment Amount or (y) delivery
by Berkshire to the Facility Sublessor, the RMLC Assignee and the Owner
Participant (with a copy to AMBAC, unless delivery to AMBAC shall be stayed by
law) of a notice in the form of Attachment III hereto (a “Notice of
Termination”) in accordance with the notice procedures in this
paragraph 5 unless Berkshire shall have received prior to the expiration
of the Cure Period the full amount of the unpaid portion of the Premium
referred to in the Notice of Termination or a Demand for Payment.

 

Berkshire shall deliver a Notice of
Termination upon the Facility Sublessor, the RMLC Assignee and the Owner
Participant in the following manner:

 

(i)                                     The Notice of
Termination shall be sent by FedEx or other similar courier service (FedEx and
any such other courier service being referred to herein as the “Courier
Service”) to each of the Facility Sublessor, the RMLC Assignee and the
Owner Participant at its address set forth in paragraph 8 hereof and to
each of addressees listed on Exhibit A hereto at the addresses set forth
on such Exhibit (as such Exhibit may be modified by written notice
from the Owner Participant to Berkshire from time to time), and shall also be
sent by email to the addressees listed on Exhibit A to the email addresses
for such persons set forth on such Exhibit (as such Exhibit may be
modified by written notice from the Owner Participant to Berkshire from time to
time as provided above).

 

 

(ii)                                  Each Notice of
Termination sent by Courier Service pursuant to this paragraph 5 shall be
accompanied by a notice (printed on red paper) affixed to the outside of the envelope
containing such Notice of Termination in the form of Attachment IV hereof.  Each notice sent by email shall also contain
a notice in the form of Attachment IV.

 

(iii)                               On the Business
Day immediately preceding, on or within two Business Days following the date on
which the Notice of Termination is sent by Courier Service as provided above,
an officer, employee, representative or agent of Berkshire shall, between the
hours of 9:00 a.m. and 5:00 p.m., New York time, place a telephone
call to each of the persons listed on Exhibit A to the phone numbers
listed on such Exhibit (as such Exhibit may be modified by written
notice from the Owner Participant to Berkshire from time to time), and shall (A) if
such person is available and answers the phone at such time, inform such person
that such person “will be receiving by Courier Service an important Notice of
Termination regarding the Oglethorpe Leveraged Lease Transaction (P1),” or
(B) if such person is not then available, use reasonable efforts to leave
a voicemail message on such person’s voicemail, and a message with any person
who then answers such person’s telephone, to the same effect as set forth in
clause (A) above.

 

6.                                       Notwithstanding the provisions of paragraph 5 hereof, (a) if
the payment of any amount in respect of the Covered Obligations is avoided (an “Avoidance
Event”) under any applicable Insolvency Proceeding with respect to Oglethorpe
or AMBAC, and, as a result of such Avoidance Event, the Facility Sublessor or
the RMLC Assignee is required to return or turn over such avoided payment, or
any portion of such avoided payment (an “AMBAC Avoided Payment” in the case of
an Insolvency Proceeding with respect to AMBAC, an “Oglethorpe Avoided Payment”
in the case of an Insolvency Proceeding with respect to Oglethorpe, and each an
“Avoided Payment”), and (b) Berkshire has not theretofore made a payment
of the maximum amount of the Surety Bond Coverage to the Facility Sublessor or
the RMLC Assignee, Berkshire will pay (1) with respect to an Oglethorpe Avoided
Payment, the amount thereof minus any payments (other than AMBAC Avoided
Payments) with respect thereto made by AMBAC under the AMBAC Surety Bond, and (2) with
respect to an AMBAC Avoided Payment, the sum of, without duplication, (x) the
amount thereof plus (y) that portion of the Claimed Amount (as defined in
the AMBAC Surety Bond) that remains unpaid as of the date the Demand for
Avoided Payment relating thereto is given to Berkshire in accordance with
paragraph 8 hereof, in each case out of the funds of Berkshire, when the
applicable or related Avoided Payment is due to be paid pursuant to the Order
referred to below, but in any event no earlier than the second Business Day
following receipt by Berkshire of (i) a certified copy of an order of a
court or other body exercising jurisdiction in such Insolvency Proceeding to
the effect that the Facility Sublessor or the RMLC Assignee is required to
return or pay over such Avoided Payment because such Avoided Payment was
avoided as a 

 

 

preferential
transfer or otherwise rescinded or required to be restored by the Facility
Sublessor or the RMLC Assignee (the “Order”), (ii) a certificate by or on
behalf of the Facility Sublessor or the RMLC Assignee that the Order has been
entered and is not subject to any stay, and that the Facility Sublessor or the
RMLC Assignee, as the case may be, has complied with or will timely comply with
such order, (iii) an assignment in the form of Exhibit A to the
Demand for Avoided Payment, duly executed
and delivered by the Facility Sublessor or the RMLC Assignee, as the case may
be, irrevocably assigning to Berkshire all rights and claims of the Facility
Sublessor or the RMLC Assignee, as the case may be (subject to the
rights of the Lender as provided in the Loan Agreement) relating to or arising under the Operative Documents against (A) Oglethorpe
or its estate, in the case of and with respect to an Oglethorpe Avoided
Payment, or (B) AMBAC or its estate, in the case of and with respect to an
AMBAC Avoided Payment and that portion of the Claimed Amount (as defined in the
AMBAC Surety Bond) remaining unpaid as of the date of Demand for Avoided Payment and (iv) a demand for
payment for a portion or all of the unpaid amount of the Avoided Payment and,
in the case of an AMBAC Avoided Payment, any unpaid portion of the Claimed
Amount, in an amount up to and including, but not exceeding, the amount set
forth in the next succeeding paragraph, conforming to and in the form attached
hereto as Attachment II (a “Demand for Avoided Payment”), with all blank
spaces therein for variable information completed, duly executed by the
Facility Sublessor (subject to paragraph 20 hereof) or the RMLC Assignee,
and containing the certifications set forth therein.  In the event that Berkshire shall honor a
Demand for Avoided Payment made by the RMLC Assignee, the Facility Sublessor
shall, promptly upon Berkshire’s demand, provide an assignment in the form of Exhibit A
to the Demand for Avoided Payment with respect to the related Avoided
Payment.  Any failure on the part of the
Facility Sublessor to perform its obligations under the preceding sentence
shall not affect Berkshire’s obligations to the RMLC Assignee hereunder. Such
payment shall be disbursed to the receiver, conservator, debtor-in-possession or
trustee in bankruptcy named in the Order, and not to the Facility Sublessor or
the RMLC Assignee directly, unless and only to the extent the Facility
Sublessor or the RMLC Assignee has made a payment of the Avoided Payment to the
court or such receiver, conservator, debtor-in-possession or trustee in
bankruptcy named in the Order, in which case Berkshire will pay the Facility
Sublessor or the RMLC Assignee, as applicable, provided, that there has been
delivery of (a) the items referred to in clauses (i), (ii), (iii) and
(iv) above to Berkshire and (b) evidence satisfactory to Berkshire
that such payment has been made to such court or receiver, conservator,
debtor-in-possession or trustee in bankruptcy named in the Order.  “Insolvency Proceeding” means the commencement,
after the date hereof, of any bankruptcy, insolvency, readjustment of debt,
reorganization, marshalling of assets and liabilities or similar proceedings by
or against any person, or the commencement, after the date hereof, of any
proceedings by or against any person for the winding up or the liquidation of
its affairs, or the consent after the date hereof to the appointment of a
trustee, conservator, receiver or liquidator in any bankruptcy, insolvency,
readjustment of debt, reorganization, marshalling of assets and liabilities or
proceedings similar to the foregoing relating to any person.

 

Notwithstanding anything to the contrary herein, in no
event shall Berkshire be obligated to make any payment (other than the payment
of interest and expenses as herein 

 

 

provided) pursuant to any Demand for Avoided Payment,
which payment, when added to all other payments (other than the payment of
interest and expenses as herein provided)
made under this Surety Bond and the Head Lease Surety Bond, would exceed the
Surety Bond Coverage as of the date applicable to such payment under the
definition of “Surety Bond Coverage” in paragraph 7(j) hereof.

 

Upon receipt by Berkshire of any payment in respect of
the Premium or any portion thereof, neither such payment nor any part thereof
shall be subject to rebate, reduction or refund for any reason or under any
circumstances whatsoever, including, without limitation, the payment or
prepayment of Oglethorpe’s obligations under the Facility Sublease or any of
the other Operative Documents or the obligations of AMBAC under the AMBAC
Surety Bond or the AMBAC Head Lease Surety Bond, or the termination or release
of this Surety Bond or the AMBAC Surety Bond prior to the termination of the
Facility Sublease.

 

7.                                       As used herein, the following capitalized terms shall have the following
meanings:

 

(a)                                  “AMBAC
Assignment Agreement” means the Agreement for Assignment on Default (P1)
dated as of December 30, 1996 among the Owner Participant, the Owner
Trustee, the Co-Trustee and AMBAC, as amended.

 

(b)                                 “AMBAC Head
Lease Surety Bond” means the Amended
and Restated Surety Bond (Head Lease-P1) issued on May 22, 2009, Policy No. SF0003BE,
executed by AMBAC in favor of the “Guaranteed Parties” named therein.

 

(c)                                  “AMBAC
Purchase Option” means the “Purchase Option” under and as defined in the
AMBAC Assignment Agreement.

 

(d)                                 “AMBAC Surety Documents” means, collectively, the AMBAC Surety
Bond, the AMBAC Head Lease Surety Bond and the AMBAC Assignment Agreement.

 

(e)                                  “Berkshire
Assignment on Default” means the Berkshire Agreement for Assignment on
Default (P1) dated as of the date hereof among Berkshire, the Co-Trustee, the
Owner Trustee and the Owner Participant.

 

(f)                                    “Berkshire
Purchase Option” means the “Purchase Option” under and as defined in the
Berkshire Assignment on Default.

 

(g)                                 “Excluded
Rights” means all rights, remedies and benefits under the Operative
Documents of the Owner Participant in respect of the period on or prior to the
date of Payment in Full (including, without limitation, under Sections 11
and 12 of the Participation Agreement and under the Tax Indemnity Agreement)
that accrue in respect of or that are attributable to acts, omissions, facts or
events existing or occurring on or prior to the time of Payment in Full, but
excluding any amounts owing to the Owner Participant that are included in the
calculation of the amount of such Payment in Full.

 

 

(h)                                 “Head Lease Surety Bond” means Surety Bond (Head Lease-P1) No. 98SRD102494
issued by Berkshire with respect to certain payment obligations of Oglethorpe
under the Participation Agreement and certain payment obligations of AMBAC
under the AMBAC Head Lease Surety Bond.

 

(i)                                  “Implementation
Agreement” means the Surety Bond Implementation Agreement (P1), dated as of
the date hereof, among Oglethorpe, RMLC, the Owner Participant, the Owner
Trustee, the Co-Trustee, AMBAC and Berkshire.

 

(j)                                     “Surety Bond Coverage” means, for any period set forth on Schedule
A attached hereto with respect to the payment of any Deficiency and any Avoided
Payment hereunder, (x) the amount shown opposite the period in which the
date on which the Demand for Payment of such Deficiency or Avoided Payment is
given to Berkshire in accordance with paragraph 8 hereof or deemed given
to Berkshire as set forth below in this paragraph (j); minus (y) any amounts (other than amounts that
constituted AMBAC Avoided Payments)
previously paid hereunder and under the Head Lease Surety Bond, the AMBAC
Surety Bond and the AMBAC Head Lease Surety Bond.  The amount described in clause (y) above
shall be determined without regard to any amounts previously paid comprising
expenses payable under the AMBAC Surety Bond, the AMBAC Head Lease
Surety Bond, paragraph 12 hereof or under
paragraph 12 of the Head Lease Surety Bond or interest on amounts not paid by
Berkshire when due and payable hereunder as provided in the last sentence of
paragraph 1 hereof or the last sentence of paragraph 1 of the Head Lease Surety
Bond or interest on amounts not paid by AMBAC when due and payable under the
AMBAC Surety Bond or the AMBAC Head Lease Surety Bond (excluding any interest
that could have been avoided under the AMBAC Surety Bond or the AMBAC Head
Lease Surety Bond had a Demand for Payment or Demand for Avoided Payment been
made hereunder or under the Head Lease Surety Bond at the earliest date
provided for such a Demand for Payment or Demand for Avoided Payment, as the
case may be, hereunder or thereunder). 
With respect to any AMBAC Avoided Payment, the date on which Demand for
Payment of such AMBAC Avoided Payment is deemed given to Berkshire for purposes
of the first sentence of this paragraph 7(j) shall be the Business Day
next following the date on which such AMBAC Avoided Payment was first demanded
from AMBAC.  With respect to any Deficiency
hereunder payable after AMBAC shall have paid the first Surety Bond Payment
Amount, the date on which Demand for Payment of such Deficiency is deemed given
to Berkshire for purposes of the first sentence of this paragraph 7(j) shall
be the Business Day next following the date on which such first Surety Bond
Payment Amount was first demanded from AMBAC.

 

(k)                                  “Surety Bond Payment Amount” has the meaning set forth in the
AMBAC Surety Bond.

 

8.                                       Except as otherwise provided in paragraph 5 hereof and subject to
paragraph 2 hereof, all notices, requests and other communications provided for
herein shall be given 

 

 

or
made in writing (including, without limitation, by telecopy) delivered to the
intended recipient at the following addresses or, as to Berkshire, the Facility
Sublessor, the RMLC Assignee, the Owner Participant or Oglethorpe, at such
other address as shall be designated by such Person in a notice to each other
such Person (such address with respect to any party, including copies as
specified below, being the “Address for Notice” of such party), and all such
communications shall be deemed to have been duly given when transmitted by
telecopier or personally delivered or, in the case of a mailed notice, upon
receipt, in each case given or addressed as aforesaid:

 

Berkshire

 

Berkshire Hathaway Assurance Corporation

c/o Berkshire Hathaway Group

100 First Stamford Place

Stamford, CT 06902

Attn:  General
Counsel

Facsimile No.:  (203) 363-5221

 

with copies to:

 

Berkshire Hathaway Assurance Corporation

3024 Harney Street

Omaha, NE 68131

Attention:  President

Facsimile No.:  (402) 916-3237

 

and

 

Robert E. Bennett

99 Mill Lane

Norwell, MA 02061

Facsimile No.:  (781) 659-2491

 

Facility Sublessor

 

Rocky Mountain Leasing Corporation

c/o Corporation Trust Center

1209 Orange Street, Room 123

Wilmington, Delaware 19801

Telecopier No.:  (302) 688-5459

Confirmation No.:  (302) 777-0250

 

RMLC Assignee

 

U.S. Bank National Association

EX-GA-ATPT

1349 W. Peachtree Street, Suite 1050

Atlanta, GA 30309

Facsimile No.:  (404) 898-2467

Telephone No.:  (404) 898-8830

Attention:  Jack Ellerin

 

 

Owner Participant

 

Philip Morris Capital Corporation

225 High Ridge Road

Suite 300 West

Stamford, Connecticut 06905

Facsimile No.: 
(203) 708-8256

Telephone No.: (203) 708-8347

Attention: General Counsel

 

with a copy to:

 

Philip Morris Capital Corporation

225 High Ridge Road

Suite 300 West

Stamford, Connecticut 06905

Facsimile No.: 
(203) 708-8256

Telephone No.: (203) 708-8204

Attention: Alex Russo, Vice President/Asset and
Portfolio Management

 

9.                                       Berkshire’s obligations under this Surety Bond (a) are absolute and
unconditional, (b) constitute a guaranty of payment and not a guaranty of
collection, (c) shall be a continuing guaranty of all present and future
Covered Obligations and all amendments, modifications, supplements, renewals of
or extensions to the Covered Obligations, whether such amendments,
modifications, supplements, renewals or extensions are evidenced by new or
additional instruments, documents or agreements, and (d) shall be
irrevocable.  The obligations of
Berkshire to make any payment hereunder shall, to the extent permitted by
Applicable Law, constitute separate and independent obligations of Berkshire,
and give rise to separate and independent causes of action against
Berkshire.  Berkshire specifically agrees
that, subject to receipt by Berkshire of a Demand for Payment or a Demand for
Avoided Payment conforming to and in the form of Attachment I or II hereto, as
the case may be, it shall not be necessary, and that Berkshire shall not be
entitled to require, before or as a condition of enforcing the liability of
Berkshire under this Surety Bond or requiring payment or performance of the
Covered Obligations by Berkshire hereunder, or at any time thereafter, that any
Person:  (i) file suit or proceed to
obtain or assert a claim for personal judgment against Oglethorpe, AMBAC or any
other Person that may be liable for any Covered Obligation, (ii) other
than as set forth in paragraph 1 hereof, make any other effort to obtain
payment or performance of any Covered Obligation from Oglethorpe, AMBAC or any
other Person that may be liable for such Covered Obligation, (iii) foreclose
against or seek to realize 

 

 

upon
any security now or hereafter existing for such Covered Obligation, (iv) other
than as set forth in paragraph 1 hereof, exercise or assert any other
right or remedy to which such Person is or may be entitled in connection with
any Covered Obligation or any security or other guaranty therefor, or (v) other
than as set forth in paragraph 1 hereof, assert or file any claim against
the assets of Oglethorpe, AMBAC or any other Person liable for any Covered
Obligation.

 

10.                                 THE OBLIGATIONS OF BERKSHIRE UNDER THIS SURETY BOND SHALL NOT BE REDUCED,
LIMITED OR TERMINATED, NOR SHALL BERKSHIRE BE DISCHARGED FROM ANY THEREOF, FOR
ANY REASON WHATSOEVER (other than by the payment of the Covered Obligations),
including (and whether or not the same shall have occurred or failed to occur
once or more than once and whether or not Berkshire shall have received notice
thereof):

 

(a)                                  (i) any increase of, (ii) any extension of the time of payment
or performance of, (iii) any other amendment or modification of any of the
other terms and provisions of, (iv) any release, composition or settlement
(whether by way of acceptance of a plan of reorganization or otherwise) of, (v) any
subordination (whether present or future or contractual or otherwise) of, or (vi) any
discharge, disallowance, invalidity, illegality, voidness or other
unenforceability of, the Covered Obligations; provided, however,
in each case that Berkshire’s obligation to make payments hereunder shall in no
event be greater than the Surety Bond Coverage plus interest on amounts not
paid by Berkshire when due and payable hereunder as provided in the last
sentence of paragraph 1 hereof and expenses (other than expenses payable
by AMBAC under the AMBAC Surety Bond or the AMBAC Head Lease Surety Bond);

 

(b)                                 (i) any failure to obtain or any release of, (ii) any failure
to protect or preserve, (iii) any release, compromise, settlement or
extension of the time of payment of any obligations constituting, (iv) any
failure to perfect or maintain the perfection or priority of any Lien upon, (v) any
subordination of any Lien upon, or (vi) any discharge, disallowance,
invalidity, illegality, voidness or other unenforceability of, any Lien or
intended Lien upon, any collateral now or hereafter securing the Covered
Obligations;

 

(c)                                  any invalidity or unenforceability of the Facility Sublease or any other
Operative Document for any reason whatsoever, including any action taken
pursuant to the Oglethorpe Mortgage;

 

(d)                                 any exercise of, or any election not or failure to exercise, delay in the
exercise of, waiver of, or forbearance or other indulgence with respect to, any
right, remedy or power available to a Guaranteed Party, including (i) any
election not or failure to exercise any right of set-off, recoupment or
counterclaim, (ii) any acceptance of partial payments on the Covered
Obligations, and (iii) any election of remedies effected by a Guaranteed
Party, whether or not such election affects the right to obtain a deficiency
judgment;

 

 

(e)                                  receipt by the Guaranteed Parties (and holding thereby) of additional
security or guaranties for the Covered Obligations or any part thereof;

 

(f)                                    any bankruptcy, insolvency, reorganization, arrangement, adjustment,
composition, dissolution, liquidation or the like with respect to, or in any
manner affecting, RMLC, Oglethorpe, AMBAC, Berkshire or any other Person, or
any obligation of Oglethorpe, RMLC or the RMLC Assignee under any Operative
Document or of AMBAC under the AMBAC Surety Bond or any application of Section 502(b)(6) or
other provision of the Bankruptcy Code that purports to limit Oglethorpe’s or
RMLC’s obligations under the Operative Documents;

 

(g)                                 any limitation of the remedies of the Guaranteed Parties under the
Facility Sublease or the other Operative Documents, or any limitation of the
liability of Oglethorpe under the Facility Sublease or the other Operative
Documents or of AMBAC under the AMBAC Surety Bond, which may now or hereafter
be imposed by any Applicable Law;

 

(h)                                 any merger or consolidation of Oglethorpe, AMBAC or Berkshire into or
with any other Person, or any transfer, conveyance, sale, lease or other
disposition of any or all of the assets of Oglethorpe, AMBAC or Berkshire to
any other Person, or any consent by the RMLC Assignee or the Facility Sublessor
to any such merger, consolidation, transfer of assets or any other
restructuring or termination of the corporate existence of Oglethorpe, AMBAC,
Berkshire or any other Person;

 

(i)                                     any debt of Oglethorpe or AMBAC to any Person, including Berkshire;

 

(j)                                     any claim, set-off, deduction or defense AMBAC or Berkshire may have
against any of the RMLC Assignee, the Facility Sublessor, Oglethorpe or the
other parties to the Operative Documents or AMBAC, whether hereunder or under
the Facility Sublease or the other Operative Documents or the AMBAC Surety Bond
or independent of or unrelated to the transactions contemplated by the Facility
Sublease or the other Operative Documents or the AMBAC Surety Bond (without
prejudice to Berkshire’s right to assert such claim, set-off, deduction or
defense in a separate action unrelated to any action for enforcement of this
Surety Bond or the Covered Obligations, so long as Berkshire does not set-off
the amount of such claim, set-off, deduction or defense against its obligation
to pay the Covered Obligations hereunder);

 

(k)                                  in the case of
obligations of Berkshire to the RMLC Assignee, any breach on the part of the
Facility Sublessor of any representation, warranty or covenant in or pursuant
to the Implementation Agreement or any Surety Bond; or

 

(l)                                     ANY OTHER ACT OR FAILURE TO ACT OR ANY OTHER EVENT OR CIRCUMSTANCE THAT (i) VARIES
THE RISK OF 

 

 

BERKSHIRE UNDER THIS
SURETY BOND OR (ii) BUT FOR THE PROVISIONS HEREOF, WOULD, AS A MATTER OF
STATUTE OR RULE OF LAW OR EQUITY, OPERATE TO REDUCE, LIMIT OR TERMINATE THE
OBLIGATIONS OF BERKSHIRE THEREUNDER OR DISCHARGE BERKSHIRE FROM ANY THEREOF.

 

Anything
contained herein to the contrary notwithstanding, Berkshire shall be released
from further liability hereunder in the event that the RMLC Assignee or, if the
assignment by the Facility Sublessor of its rights hereunder to the RMLC
Assignee shall have been terminated, the Facility Sublessor, in writing
releases, other than with the written consent of Berkshire, AMBAC in respect of
its obligations under the AMBAC Surety Bond or the AMBAC Head Lease Surety
Bond.

 

11.                                 (a)                                  Berkshire waives any defense to, and any set-off, counterclaim and claim
of recoupment against, the Covered Obligations that may at any time be
available to Berkshire or any other guarantor (without prejudice to Berkshire’s
right to assert such defense, set-off, counterclaim or claim in a separate
action unrelated to any action for enforcement of this Surety Bond or the
Covered Obligations, so long as Berkshire does not set-off the amount of such
defense, set-off, counterclaim or claim against its obligation to pay Covered
Obligations hereunder).  Except as set
forth in paragraph 6 hereof and in this paragraph 11, (i) Berkshire
agrees not to exercise any right of subrogation which may otherwise inure to
its benefit as a result of any payment made by it under the Surety Bond until
all obligations of RMLC and Oglethorpe to the Co-Trustee, the Owner Trustee and
the Owner Participant under the Operative Documents have been fully discharged,
and (ii) Berkshire waives until such time, to the fullest extent permitted
by Applicable Law, (A) any right to enforce any remedy which any
Guaranteed Party now has or may hereafter have against Oglethorpe in respect of
any of the Covered Obligations, and (B) any benefit of, and any right to
participate in, any collateral now or hereafter held by any Guaranteed Party
for the Covered Obligations; provided, however, that if Berkshire shall have
paid in full the amount required by any Demand for Payment or Demand for
Avoided Payment hereunder, (1) Berkshire shall immediately be subrogated
to all rights of the Guaranteed Parties in respect of AMBAC’s obligations with
respect to any related Claimed Amount (as defined in the AMBAC Surety Bond or
the AMBAC Head Lease Surety Bond) that is unpaid under the AMBAC Surety Bond
and/or the AMBAC Head Lease Surety Bond, (2) Berkshire
shall be entitled to exercise any and all rights and to enforce any and all
remedies which any Guaranteed Party now has or may hereafter have against AMBAC
with respect to any related Claimed Amount that is unpaid under the AMBAC
Surety Bond and/or the AMBAC Head Lease Surety Bond, and (3) Berkshire shall have the sole and
exclusive benefit of, and the sole and exclusive right to participate in, any
claims or recoveries to the extent of such amount and with respect to any
related Claimed Amount that is unpaid under the AMBAC Surety Bond and/or the AMBAC
Head Lease Surety Bond, in each case under
clauses (1), (2) and (3) for its own benefit and to the
exclusion of the Guaranteed Parties and any other Persons, except as otherwise
provided in the penultimate sentence of paragraph 11(f)(ii) hereof.

 

 

(b)                                 Berkshire
waives:  (i) notice of acceptance of
and intention to rely on this Surety Bond, (ii) notice of the incurrence
or renewal of any other Covered Obligation, (iii) notice of any of the
matters referred to in paragraph 10 hereof, and (iv) all other
notices that may be required by Applicable Law or otherwise to preserve any
rights against Berkshire under this Surety Bond, including any notice of
default, demand, dishonor, presentment or protest, in each case except as
expressly provided herein.  Berkshire
assumes the responsibility for being and keeping informed of the financial
condition of Oglethorpe and AMBAC and of all other circumstances bearing upon
the risk of nonpayment of the Covered Obligations which diligent inquiry would
reveal, and agrees that each Guaranteed Party shall have no duty beyond its obligations
in the Operative Documents to advise Berkshire of information known to it
regarding such condition or any such circumstances.  It is not and shall not be necessary for any
Guaranteed Party to inquire into the powers of either Oglethorpe or AMBAC or
any of its agents acting or purporting to act on behalf thereof, and any
Covered Obligations made or created in reliance upon the professed exercise of
such powers shall be guaranteed hereunder.

 

(c)                                  Except
as set forth in paragraph 1 hereof, Berkshire waives any requirement, and
any right to require, that any right or power be exercised or any action be
taken against Oglethorpe or AMBAC or any collateral for the Covered
Obligations, and Berkshire waives the right to have the property of Oglethorpe
or AMBAC first applied to the discharge of the Covered Obligations.  Each of the Facility Sublessor and the RMLC
Assignee may at its election exercise any right or remedy it may have against
Oglethorpe or AMBAC or any collateral now or hereafter held by such Person,
including, without limitation, the right to foreclose upon any such collateral
by judicial or nonjudicial sale, without affecting or impairing in any way the
liability of Berkshire hereunder. 
Berkshire waives:  (i) any
defense arising by reason of any disability or other defense of Oglethorpe or
AMBAC or by reason of the cessation from any cause whatsoever of the liability,
either in whole or in part, of Oglethorpe or AMBAC to each of the Facility
Sublessor and the RMLC Assignee for the Covered Obligations (without prejudice
to Berkshire’s right to assert a claim based on such disability or other
defense or cessation, in a separate action unrelated to any action for
enforcement of this Surety Bond or the Covered Obligations, so long as
Berkshire does not set-off the amount of such claim against its obligation to
pay Covered Obligations hereunder), (ii) any defense based on the
discharge of Oglethorpe or AMBAC by operation of law, notwithstanding any
intervention or omission by the Facility Sublessor or RMLC Assignee, and (iii) any
defense based on or arising out of the absence, impairment or loss of any right
of reimbursement, contribution, assignment or subrogation or any other right or
remedy of Berkshire against Oglethorpe or AMBAC or any such collateral, whether
resulting from such election by the Facility Sublessor or the RMLC Assignee or
otherwise.

 

(d)                                 Berkshire
waives all rights, benefits or defenses under any Applicable Laws which:  (i) reduce the obligation of a surety
upon the acceptance by a creditor of anything in partial satisfaction of an
obligation, (ii) exonerate the surety if by an act of the creditor,
without the consent of the surety, the original obligation of the principal is
altered in any respect, or the remedies or rights of the creditor against the
principal, in respect thereto, are in any way suspended or impaired, (iii) exonerate
the surety to the 

 

 

extent
that the creditor does not proceed against the principal, or pursue any other
remedy in the creditor’s power which the surety cannot pursue, and which would
lighten the surety’s burden, and (iv) reduce the guaranteed obligation in
proportion to the principal obligation; provided that this paragraph (d) shall
not apply to (A) any voluntary release, voluntary reduction, voluntary
amendment or voluntary termination of the AMBAC Surety Bond or the AMBAC Head
Lease Surety Bond entered into by the Owner Participant, the Owner Trustee or
the Co-Trustee, as the case may be, or (B) any release, reduction,
amendment or termination of the AMBAC Surety Bond or the AMBAC Head Lease
Surety Bond by the Owner Participant, the Owner Trustee or the
Co-Trustee in violation of the Operative
Documents or Applicable Law; provided  further that, for
all purposes of this Surety Bond, any Demand for Payment or any Demand for
Avoided Payment, any court-ordered or
legally required release, reduction, amendment or termination of the AMBAC
Surety Bond or the AMBAC Head Lease Surety Bond shall not be considered
voluntary unless such court order was requested or consented to by the
Owner Participant, the Owner Trustee or the Co-Trustee.

 

(e)                                  Except
as otherwise provided in paragraph 11(d) above, BERKSHIRE WAIVES ALL
OTHER RIGHTS, BENEFITS AND DEFENSES UNDER APPLICABLE LAW THAT WOULD, BUT FOR
THIS PARAGRAPH 11(e), BE AVAILABLE TO BERKSHIRE AS A DEFENSE AGAINST OR A
REDUCTION OR LIMITATION OF ITS OBLIGATIONS UNDER THIS SURETY BOND (without
prejudice to Berkshire’s right to assert such rights, benefits or defenses in a
separate action unrelated to any action for enforcement of this Surety Bond or
the Covered Obligations, so long as Berkshire does not set-off the amount of
such rights, benefits or defenses against its obligation to pay Covered
Obligations hereunder).

 

(f)                                    (i)                                     Berkshire agrees, and each of the Guaranteed Parties by
acceptance of this Surety Bond and by submission of the Demand for Payment or
Demand for Avoided Payment hereunder with respect to a Deficiency or an Avoided
Payment, as the case may be, agrees, that concurrently upon the payment in full
by Berkshire of such Deficiency or Avoided Payment and the balance of the Total
Outstanding Amount (as defined in the Demand for Payment or Demand for Avoided
Payment) (whether or not in excess of the Surety Bond Coverage, “Payment in
Full”), Berkshire shall, subject to clause (ii) below, be subrogated
to all of the rights and remedies of the
RMLC Assignee and the Facility Sublessor (subject to the rights of the
Lender as provided in the Loan Agreement and other than those rights to which
AMBAC had previously been subrogated in accordance with the terms of the AMBAC
Surety Documents and the Implementation Agreement)  with respect to the Covered Obligations giving rise to such
Deficiency or Avoided Payment and/or comprising the balance of the Total
Outstanding Amount under the Participation Agreement and the other Operative
Documents and all right, title and interest of the Head Lessee, the Facility
Lessor, the Facility Sublessor and the RMLC
Assignee under the Operative Documents (other than, in each and every case,
Excluded Rights).

 

(ii)                                  Upon Payment in
Full, each of the Facility Sublessor and
the RMLC Assignee shall cooperate as reasonably requested by Berkshire,
at Berkshire’s expense, in Berkshire’s exercise of the subrogation and other 

 

 

rights contemplated by paragraph 11(a) and
this paragraph 11(f) as may be reasonably necessary to carry out more
effectively the intent and purpose of such subrogation and other rights; provided,
however, that neither the Facility
Sublessor nor the RMLC Assignee shall be required by this sentence to
take any action that (A) may expose it to criminal or unindemnified civil
liability or (B) that would reasonably be expected to have a material
adverse effect on the Owner Participant to the extent not indemnified by
Berkshire.  Upon the request of Berkshire
after Payment in Full, each of the RMLC
Assignee and the Facility Sublessor shall confirm the transfer of its
respective portion of such rights to Berkshire by executing an instrument
substantially in the form of Attachment V. 
Any failure on the part of the Facility Sublessor to perform its
obligations under the preceding sentence shall not affect Berkshire’s
obligations to the RMLC Assignee hereunder. 
Without limiting the foregoing, from and after delivery of a Demand for
Payment or Demand for Avoided Payment, (A) neither the Facility Sublessor nor the RMLC Assignee shall take any action
with respect to enforcement of AMBAC’s obligations under the AMBAC Surety Bond
or the AMBAC Head Lease Surety Bond with respect to any Claimed Amount that is
unpaid thereunder (in each case except for any such action as may be reasonably
requested by Berkshire), and Berkshire shall be entitled to control and direct
the exercise of all remedies (including but not limited to all proceedings and
settlements) in respect of the AMBAC Surety Bond and the AMBAC Head Lease
Surety Bond with respect to any such Claimed Amount, through counsel of
Berkshire’s choice, and in each case without any duty or liability to the
Guaranteed Parties for any actions taken or not taken in connection therewith,
and (B) if Payment in Full has been made (and not avoided under any
bankruptcy or insolvency proceeding), except as specified in the next following
sentence, neither the Facility Sublessor
nor the RMLC Assignee shall take any action (other than any action that the Facility Sublessor or the RMLC Assignee is
required to take under the Operative Documents) with respect to enforcement of
the Covered Obligations under the Facility Sublease, the Participation Agreement
or any other Operative Documents without the prior written consent of Berkshire
(other than, in each and every case, Excluded Rights), and, subject to the
rights of the Lender as provided in the Loan Agreement, Berkshire shall be
entitled to control and direct the exercise of remedies (including but not
limited to all proceedings and settlements) in respect of Covered Obligations
(other than with respect to Excluded Rights) through counsel of Berkshire’s
choice; provided that any amounts recovered or realized by Berkshire
pursuant to the exercise of the subrogation rights set forth in this
paragraph 11(f), and in any case excluding any such rights in respect of
the AMBAC Surety Bond or the AMBAC Head Lease Surety Bond, shall be first
applied and paid over to the Guaranteed Parties to discharge any and all unpaid
obligations of Oglethorpe to such Persons under the Operative Documents, prior
to any application of such amounts to any amounts owing to 

 

 

Berkshire with respect to payments made under
this Surety Bond or other payments in respect of Oglethorpe’s obligations.  In the event that, following any Payment in
Full, any amount paid by or on behalf of Oglethorpe or AMBAC to the Facility
Sublessor or the RMLC Assignee that shall have been taken into account in
computing the Total Outstanding Amount shall become an Avoided Payment,
notwithstanding the next preceding sentence, the Facility Sublessor or the RMLC
Assignee, as applicable, may enforce its claim against Oglethorpe or AMBAC,
after consultation with Berkshire and in continued consultation with Berkshire
in order to avoid inefficient prosecution of the respective claims of Berkshire
and the Facility Sublessor or the RMLC Assignee, as applicable, with respect to
that portion of such amount that shall remain unpaid after the maximum amount
of the Surety Bond Coverage shall have been drawn hereunder, provided,
that any recovery by the Facility Sublessor or the RMLC Assignee pursuant to
such exercise in excess of the amount required to discharge any unpaid
obligations of Oglethorpe or AMBAC to such Persons or the Owner Participant or
any Affiliate thereof under the Operative Documents shall be paid over to
Berkshire for application to any unpaid Berkshire Obligations (as defined in
the Implementation Agreement).  For the
avoidance of doubt, no amounts recovered or realized by Berkshire from the
exercise by Berkshire of its rights pursuant to the Berkshire Guaranty
Agreement (P1) dated the date hereof between Oglethorpe and Berkshire or
(following payment in full of the Deficiency (as defined in the Demand for
Payment) or any amount due pursuant to a Demand for Avoided Payment and any
interest payable hereunder) in respect of the AMBAC Surety Bond or the AMBAC
Head Lease Surety Bond, shall be subject to the order of distribution set forth
in the penultimate sentence of this paragraph 11(f)(ii) or any other
rights of the Guaranteed Parties.

 

(iii)                               The existence
of the subrogation rights in paragraph 11(a) hereof or this
paragraph 11(f) shall not in any way give rise to any duty on the
part of Berkshire, except as expressly set forth in such paragraph 11(a) or
this paragraph 11(f).

 

(iv)                              Nothing in
paragraph 11(a) or this paragraph 11(f) shall be construed
to be a representation on the part of the
Facility Sublessor or RMLC Assignee as to the existence or extent of the
right, title, interest and remedies to which Berkshire shall be subrogated
pursuant to such paragraphs, except as expressly set forth in the Assignment
(substantially in the form of Exhibit A to the Demand for Avoided Payment)
or the Confirmation of Transfer (substantially in the form of Attachment V) in
respect of the RMLC Assignee’s or
the Facility Sublessor’s, as the case may be, not having assigned any of the
same (other than, in the case of the Facility Sublessor, to the RMLC Assignee
pursuant to the Facility Sublease Assignment Agreement and, in the case of the
RMLC Assignee, the grant to the Lender of a security interest in such Covered
Obligations and other 

 

 

rights under and as provided by the Loan
Agreement and other than any assignment or grant of subrogation rights required
under the terms of the AMBAC Surety Documents) and as to the absence of
Facility Lessor’s Liens.

 

12.                                 In addition to
Berkshire’s obligations under paragraph 1 hereof, Berkshire agrees to pay on demand all fees and out of pocket expenses
(including the reasonable fees and expenses of the Facility Sublessor’s counsel
and the RMLC Assignee’s counsel) in any way relating to the enforcement of the
rights of the Facility Sublessor or RMLC Assignee hereunder or as
otherwise specified under the Surety Bond Documents (as defined in the
Agreement Regarding Surety Bonds (P1) dated the date hereof among
Oglethorpe, RMLC and Berkshire); provided, that, except as expressly set forth
in the Surety Bond Documents, Berkshire
shall not be liable for any expenses of the Facility Sublessor or the RMLC
Assignee if no payment under this Surety Bond is or was at any time due or if
all payments are made in accordance with the terms hereof.

 

13.                                 Each of the rights and remedies of the Facility Sublessor or the RMLC
Assignee under this Surety Bond shall be in addition to all of its other rights
and remedies under Applicable Law, and nothing in this Surety Bond shall be
construed as limiting any such rights or remedies.

 

14.                                 Any term, covenant, agreement or condition of this Surety Bond may be
amended, and any right under this Surety Bond may be waived, if, but only if,
such amendment or waiver is in writing and is signed by the Facility Sublessor
and the RMLC Assignee and, in the case of an amendment, by Berkshire.  No election not to exercise, failure to
exercise or delay in exercising any right, nor any course of dealing or
performance, shall operate as a waiver of any right of the Facility Sublessor
or the RMLC Assignee under this Surety Bond or Applicable Law, nor shall any
single or partial exercise of any such right preclude any other or further
exercise thereof or the exercise of any other right of the Facility Sublessor
or the RMLC Assignee under this Surety Bond or Applicable Law.

 

15.                                 (a) Prior to payment of all amounts payable by Berkshire hereunder,
Berkshire may not assign any of its rights or obligations under this Surety
Bond without the prior written consent of the Facility Sublessor and the RMLC
Assignee, and (b) no assignment of any such obligation shall release
Berkshire therefrom unless the Facility Sublessor and the RMLC Assignee shall
have consented to such release in a writing specifically referring to the
obligation from which Berkshire is to be released; provided, however, that
Berkshire may procure any other surety to reinsure this Surety Bond.

 

16.                                 THIS SURETY BOND AND ANY BREACH OR DISPUTE WITH RESPECT TO THIS SURETY
BOND SHALL, PURSUANT TO NEW YORK GENERAL OBLIGATIONS LAW SECTION 5-1401,
BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK.

 

17.                                 Any provision of this Surety Bond that is prohibited or unenforceable in
any jurisdiction shall, as to such jurisdiction, be ineffective to the extent
of such prohibition or unenforceability without invalidating the remaining
provisions hereof or affecting the 

 

 

validity
or enforceability of such provision in any other jurisdiction.  To the extent permitted by Applicable Law,
Berkshire hereby waives any provision of Applicable Law that renders any
provision of this Surety Bond prohibited or unenforceable in any respect.

 

18.                                 All of the provisions of this Surety Bond shall be binding upon Berkshire
and its successors and assigns and shall inure to the benefit of, and (subject
to paragraph 20 hereof) may be enforced by, each of the Facility Sublessor and
the RMLC Assignee and their respective successors and permitted assigns under
the provisions of the Operative Documents.

 

19.                                 This Surety Bond may be assigned and transferred by the Facility
Sublessor or the RMLC Assignee to any successor or permitted assigns under the
provisions of the Operative Documents of the Facility Sublessor or the RMLC
Assignee upon delivery to Berkshire of a certificate of an authorized officer
of the applicable transferor and the transferee notifying Berkshire of such
transfer.

 

20.                                 Berkshire hereby consents to the collateral assignment by the Facility
Sublessor to the RMLC Assignee of all of its rights under this Surety Bond
pursuant to the Facility Sublease Assignment Agreement.  Notwithstanding anything to
the contrary herein, (A) each of
Berkshire, the Facility Sublessor and the RMLC Assignee agrees that, unless and
until the Facility Sublease Assignment Agreement shall have been discharged in
accordance with Section 5 thereof, all payments by Berkshire hereunder,
and all amounts to which the Facility Sublessor may become entitled hereunder,
will be made to the RMLC Assignee (and not to the Facility Sublessor) and the
RMLC Assignee shall have the sole and exclusive right to exercise any rights of
the Facility Sublessor under this Surety Bond, and (B) unless and until
the Facility Sublease Assignment Agreement shall have been discharged in
accordance with Section 5 thereof, any demands for payment or other
exercise of rights by the Facility Sublessor shall be ineffective for all
purposes.

 

[Remainder of Page Intentionally Left Blank]

 

 

IN WITNESS WHEREOF, Berkshire has caused this Surety
Bond to be executed on its behalf this 22nd day of May, 2009.

 

	
   

  	
  BERKSHIRE HATHAWAY ASSURANCE CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

Acknowledged and Consented
to by:

 

	
  OGLETHORPE POWER
  CORPORATION

  	
   

  
	
  (AN ELECTRIC MEMBERSHIP
  CORPORATION)

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
  Date:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  [corporate seal]

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Attest:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
  Date:

  	
   

  

 

 

Exhibit A

 

Recipients
of Notice of Termination on behalf of Owner Participant:

 

1.                                       Alex T. Russo

Vice
President

Asset
and Portfolio Management

Philip
Morris Capital Corporation

225
High Ridge Road, Suite 300 West

Stamford,
Connecticut 06905

Telephone
No.:  (203) 708-8204

Alex.Russo@us.pm.com

 

2.                                       John M. Spera

Vice
President, and Controller

Philip
Morris Capital Corporation

225
High Ridge Road, Suite 300 West

Stamford,
Connecticut 06905

John.Spera@us.pm.com

Telephone
No.:  (203) 708-8155

 

3.                                       Steven P.
Seagriff

Vice
President

Pricing,
Compliance, and Credit

Philip
Morris Capital Corporation

225
High Ridge Road, Suite 300 West

Stamford,
Connecticut 06905

Telephone
No.:  (203) 708-8214

Steve.Seagriff@us.pm.com

 

4.                                       Douglas B.
Levene

Vice
President, General Counsel, and Secretary

Philip
Morris Capital Corporation

225
High Ridge Road, Suite 300 West

Stamford,
Connecticut 06905

Telephone
No.:  (203) 708-8347

Doug.Levene@us.pm.com

 

 

Schedule A

 

Oglethorpe Power Corporation - Surety Bond
Calculation

 

RMLC Trust P1

 

	
  Period Starting

  and Including Date

  	
   

  	
  Period Ending and

  Including the Business

  Day Next Following

  Date

  	
   

  	
  Surety Bond Coverage

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  [05/22/09]

  	
   

  	
  [          ]

  	
   

  	
   

  
	
  *

  	
   

  	
  [          ]

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  [to come]

  	
   

  	
   

  

 

* Date next following ending date of next preceding
period described in this Schedule A.

 

 

Attachment I

(Facility Sublease-P1)

Surety Bond No. 98SRD102495

 

DEMAND FOR PAYMENT

 

[Date]

 

Berkshire Hathaway Assurance Corporation

[                                                                  ]

[                                                                  ]

[                                                                  ]

 

Reference is made to the Surety Bond (Facility
Sublease-P1) No. 98SRD102495 (the “Surety Bond”) issued by
Berkshire Hathaway Assurance Corporation (“Berkshire”).  The terms which are capitalized herein and
not otherwise defined have the meanings specified in the Surety Bond unless the
context otherwise requires.

 

The
[Facility Sublessor]/[RMLC Assignee] hereby certifies that:

 

(a)                                  [Either (i) at least two Business Days prior to the date of this
Demand for Payment, the Facility Sublessor or the RMLC Assignee demanded in
writing (such demand being the “Oglethorpe Payment Demand”) payment from
Oglethorpe of the Termination Value under the Facility Sublease, together with
other amounts constituting Covered Obligations under the Operative Documents,
in an aggregate amount equal to
$[                    ]
(the “Amount Due”), and such amount was then and as of the date of this
Demand for Payment continues to be due and payable, or (ii) for a
period of at least two Business Days prior to the date of delivery of this
Demand for Payment to Berkshire, the [Facility Sublessor]/[RMLC Assignee] has
been and continues to be stayed (as a consequence of an Insolvency Proceeding
pertaining to the insolvency of Oglethorpe or RMLC) or has been and continues
to be otherwise legally prohibited from making an Oglethorpe Payment Demand,
and but for the existence of such stay or other prohibition, the Facility
Sublessor or the RMLC Assignee would have been entitled to make such Oglethorpe
Payment Demand and the Amount Due would thereupon have become due and payable
by Oglethorpe] / [AMBAC has paid the first Surety Bond Payment Amount].

 

(b)                                 Either (i)(A) at least one Business Day prior to the date of
this Demand for Payment, (1) the Facility Sublessor or the RMLC Assignee
(whichever is then authorized to do so under the terms of the AMBAC Surety
Bond) demanded in writing (such demand being the “AMBAC Payment Demand”)
payment from AMBAC of the unpaid portion of the Amount Due or, if less, the
maximum amount then payable under the AMBAC Surety Bond (the amount demanded
under the AMBAC Surety Bond being the “AMBAC Claimed Amount”) under and
in compliance with the terms of the AMBAC Surety Bond, and (2) all or any
portion of the AMBAC Claimed Amount was then due and payable under the terms of
the AMBAC Surety Bond, and (B) such AMBAC Claimed Amount or any portion thereof
remains unpaid (the lesser of the Amount Due and the portion of the AMBAC
Claimed Amount that remains unpaid being the “Claimed Amount”), or (ii) for
a period of at least one Business Day prior to the date of delivery of this
Demand for Payment, the Facility Sublessor or the RMLC Assignee, as the case 

 

 

may be, has been and
continues to be stayed (as a consequence of an Insolvency Proceeding pertaining
to the insolvency of AMBAC) or has been and continues to be otherwise legally
prohibited from making an AMBAC Payment Demand, and but for the existence of
such stay or other prohibition, the Facility Sublessor or RMLC Assignee would
have been entitled to make such AMBAC Payment Demand and the AMBAC Claimed
Amount or the applicable Surety Bond Payment Amount then payable under the
AMBAC Surety Bond would thereupon have become due and payable by AMBAC.

 

(c)                                  The Facility Sublessor or the RMLC Assignee has delivered to Berkshire (i) at
least two Business Days prior to the date of this Demand for Payment, either a
copy of the Oglethorpe Payment Demand or written notice that delivery thereof
has been stayed or otherwise prohibited as contemplated above, unless AMBAC has
paid the first Surety Bond Payment Amount, in which case the delivery referred
to in this clause (i) is not required, and (ii) at least one
Business Day prior to the date of this Demand for Payment, either a copy of the
AMBAC Payment Demand or written notice that delivery thereof has been stayed or
otherwise prohibited as contemplated above.

 

(d)                                 As of the date of this Demand for Payment, (i) $[              ]
(exclusive of interest and expenses) (the “Oglethorpe Payment”) has been
paid to the Facility Sublessor or the RMLC Assignee by or on behalf of
Oglethorpe with respect to the Amount Due and/or to or for the account of the
Facility Lessor in respect of the Termination Value under the Facility
Sublease, and (ii) $[              ]
(exclusive of interest and expenses) (the “AMBAC Payment”) has been paid
to the Facility Sublessor or the RMLC Assignee by AMBAC under the AMBAC Surety
Bond and/or the AMBAC Head Lease Surety Bond, (iii) $[          ]
has been paid and/or is the subject of a simultaneous outstanding demand for
payment under the Head Lease Surety Bond (the “Head Lease Surety Bond Amount”);
and (iv) $[          ]
(the “Avoided Payments”) of any such Oglethorpe Payment or AMBAC Payment
has been returned or turned over as an avoided payment to Oglethorpe or AMBAC,
respectively, or any other person by the
Facility Sublessor or the RMLC Assignee as a result of an Avoidance
Event in respect of any payment made by Oglethorpe under the Facility Sublease
or AMBAC under the AMBAC Surety Bond.

 

(e)                                  (i)  As of
the date hereof, the Covered Obligations that are (x) due and payable by
Oglethorpe under the terms of the Facility Sublease, the Participation
Agreement or any of the other Operative Documents (other than the Head Lease or
the Facility Lease), or are payable upon demand but cannot be demanded from,
Oglethorpe pursuant to the terms of the Facility Sublease, the Participation
Agreement or any of the other Operative Documents (other than the Head Lease or
the Facility Lease) by reason of the operation of a stay or other order issued
in an Insolvency Proceeding pertaining to the insolvency of Oglethorpe or RMLC,
and, giving effect to the application of the Oglethorpe Payment (less the
amount of any Avoided Payment with respect thereto), the AMBAC Payment (less
the amount of any Avoided Payment with respect thereto) and the Head Lease
Surety Bond Amount, have not been paid, and (y) due and payable by AMBAC
under the terms of the AMBAC Surety Bond, or the present payment of which
cannot be demanded from AMBAC under the terms of the AMBAC Surety Bond by
reason of the operation of a stay or other order issued in an Insolvency
Proceeding pertaining to the insolvency of AMBAC, and have not been paid, are
specified in the attachment hereto and are in the aggregate, without
duplication,
$[              ]
(the “Sublease Outstanding Amount”).

 

 

(i)                                     The Surety Bond Coverage is
$[              ].

 

(ii)                                  The lesser of the Sublease Outstanding Amount and the Surety Bond
Coverage is $           (the “Deficiency”).

 

(iii)                               As of the date hereof, the Head Lease Outstanding Amount (as defined in
the Head Lease Surety Bond) is specified in an attachment hereto and is
$[              ].

 

(iv)                              The sum of the Sublease Outstanding Amount and of the Head Lease
Outstanding Amount, (taking into account any provision of the Operative
Documents pursuant to which payment of amounts comprising the Sublease
Outstanding Amount are deemed to pay and satisfy other amounts comprising the
Sublease Outstanding Amount or the Head Lease Outstanding Amount, and vice  versa), is
specified in an attachment hereto and is
$[                  ]
(the “Total Outstanding Amount”).

 

(f)                                    Neither the Facility Sublessor nor the RMLC Assignee has been paid all or
any part of the Deficiency by Berkshire; and neither the AMBAC Surety Bond nor
the AMBAC Head Lease Surety Bond has been voluntarily released by the
undersigned[, the Owner Participant or the Owner Trustee](4) or terminated by voluntary agreement of the undersigned[, the Owner
Participant or the Owner Trustee](5).

 

(g)                                 Neither Ambac nor any Affiliate of AMBAC has become the Owner
Participant or is a party to any contract or arrangement (other than the AMBAC
Documents) with the Owner Participant or any Affiliate thereof or the Owner
Trustee pursuant to which AMBAC or any such Affiliate of AMBAC shall have
acquired or shall (other than as provided in the AMBAC Documents) have the
right to acquire all or substantially all of the economic benefits attributable
to the Beneficial Interest, the Trust Estate or the Leasehold Interest or any
substantial part thereof or interest therein.

 

The [Facility Sublessor]/[RMLC Assignee] hereby requests
that payment of the Deficiency be made by Berkshire under the Surety Bond and
direct that payment under the Surety Bond be made to the following account by
bank wire transfer of federal or other immediately available funds in
accordance with the terms of the Surety Bond:

 

Account Information:

                                             

                                             

                                             

                                             

 

[Rocky Mountain Leasing
Corporation, as Facility Sublessor

 

	
  By:

  	
   

  	
   

  
	
  Title:]

  	
   

  

 

(4) Include if
this demand is made by the Co-Trustee.

(5) Include if
this demand is made by the Co-Trustee.

 

 

	
  [U.S.
  Bank National Association,

  	
   

  
	
  not
  in its individual capacity,

  	
   

  
	
  but
  solely as Co-Trustee

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
  Title:]

  	
   

  
			

 

 

Attachment II

(Facility Sublease-P1)

Surety Bond No. 98SRD102495

 

DEMAND FOR AVOIDED PAYMENT

 

[Date]

 

Berkshire Hathaway Assurance Corporation

[                                                                  ]

[                                                                  ]

[                                                                  ]

 

Reference is made to the Surety Bond (Facility
Sublease-P1) No. 98SRD102495 (the “Surety Bond”) issued by
Berkshire Hathaway Assurance Corporation (“Berkshire”).  The terms which are capitalized herein and
not otherwise defined have the meanings specified in the Surety Bond unless the
context otherwise requires.

 

The [Facility Sublessor] / [RMLC Assignee] hereby
certifies that:

 

(a)                                  An Avoidance Event has occurred under an Insolvency Proceeding with
respect to [Oglethorpe or AMBAC], and, as a result of such Avoidance Event, the
Facility Sublessor or the RMLC Assignee is required to return or turn over an
Avoided Payment in the amount of
$[            ]
(the “Avoided Payment”).

 

(b)                                 Berkshire has not heretofore made a payment of the maximum amount of the
Surety Bond Coverage to the Facility Sublessor or the RMLC Assignee.

 

(c)                                  Attached hereto is a certified copy of an order of a court or other body
exercising jurisdiction in such Insolvency Proceeding to the effect that the
Facility Sublessor or the RMLC Assignee is required to return or pay over such
Avoided Payment because such Avoided Payment was avoided as a preferential
transfer or otherwise rescinded or required to be restored by the Facility
Sublessor or the RMLC Assignee (the “Order”).

 

(d)                                 The Order has been entered and is not subject to any stay, and the
Facility Sublessor or the RMLC Assignee, as the case may be, has complied with
or will timely comply with such order.

 

(e)                                  The [Facility Sublessor] / [RMLC Assignee] has delivered to Berkshire an
assignment, in substantially the form of Exhibit A.

 

(f)                                    If the Avoided Payment is an Oglethorpe Avoided Payment, either (i)(A) at
least one Business Day prior to the date of this Demand for Avoided
Payment, (1) the Facility Sublessor or the RMLC Assignee demanded in
writing (such demand being the “AMBAC Avoided Payment Demand”) payment
from AMBAC of the Avoided Payment or, if less, the maximum amount then payable
under the AMBAC Surety Bond (the amount demanded under the AMBAC Surety Bond
being the “AMBAC Claimed Amount”) under and in compliance with 

 

 

the terms of the AMBAC
Surety Bond, and (2) all or any portion of the AMBAC Claimed Amount was
then due and payable under the terms of the AMBAC Surety Bond, and (B) such
AMBAC Claimed Amount or any portion thereof remains unpaid (the lesser of the
Oglethorpe Avoided Payment and the portion of the AMBAC Claimed Amount that
remains unpaid being the “Berkshire Claimed Amount”), or (ii) for a
period of at least one Business Day prior to the date of delivery of this
Demand for Avoided Payment, the undersigned has been and continues to be stayed
(as a consequence of an Insolvency Proceeding pertaining to the insolvency of
AMBAC) or has been and continues to be otherwise legally prohibited from making
an AMBAC Avoided Payment Demand, and but for the existence of such stay or
other prohibition, the undersigned would have been entitled to make such AMBAC
Avoided Payment Demand and the AMBAC Claimed Amount or the applicable Surety
Bond Payment Amount then payable under the AMBAC Surety Bond would thereupon
have become due and payable by AMBAC.

 

(g)                                 Neither the Facility Sublessor nor the RMLC Assignee has been paid all or
any part of the Avoided Payment by Berkshire; neither the AMBAC Surety Bond nor
the AMBAC Head Lease Surety Bond has been voluntarily released by the
undersigned[, the Owner Participant or the Owner Trustee](6) or terminated by voluntary agreement of the undersigned[, the Owner
Participant or the Owner Trustee](7).

 

(h)                                 Neither Ambac nor any Affiliate of AMBAC has become the Owner
Participant or is a party to any contract or arrangement (other than the AMBAC
Documents) with the Owner Participant or any Affiliate thereof or the Owner
Trustee pursuant to which AMBAC or any such Affiliate of AMBAC shall have
acquired or shall (other than as provided in the AMBAC Documents) have the
right to acquire all or substantially all of the economic benefits attributable
to the Beneficial Interest, the Trust Estate or the Leasehold Interest or any
substantial part thereof or interest therein.

 

The [Facility Sublessor] [RMLC Assignee] hereby requests
Berkshire to pay the amount of (x) if the Avoided Payment is an Oglethorpe
Avoided Payment, the Berkshire Claimed Amount or (y) if the Avoided
Payment is an AMBAC Avoided Payment, the sum of, without duplication, such
Avoided Payment plus that portion of the Claimed Amount (as defined in
the AMBAC Surety Bond) remaining unpaid as of the date hereof, in each case out
of the funds of Berkshire, when the applicable Avoided Payment is due to be
paid pursuant to the Order, provided that the amount of the payment
requested hereunder, when added to all other payments made under the Surety
Bond, the Head Lease Surety Bond and (to the extent not the subject of an
Avoidance Event) the AMBAC Surety Bond, shall not exceed the applicable Surety
Bond Coverage; provided, further, that Berkshire shall not be
required to make such payment earlier than the second Business Day following
receipt by Berkshire of this Demand for Avoided Payment and all attachments
referred to herein.  Such payment shall
be disbursed to the receiver, conservator, debtor-in-possession or trustee in
bankruptcy named in the Order, and not to the Facility Sublessor or the RMLC
Assignee directly, unless and only to the extent the Facility Sublessor or the
RMLC Assignee has made a payment of the Avoided Payment to the court or such
receiver, conservator, debtor-in-possession or trustee in bankruptcy named in
the Order, in which case Berkshire will pay the RMLC Assignee, unless such
Avoided Payment shall have 

 

(6) Include if
this demand is made by the Co-Trustee

(7) Include if
this demand is made by the Co-Trustee

 

 

been recovered from the Facility Sublessor and not from
the RMLC Assignee, in which case Berkshire shall pay the Facility Sublessor,
subject to the delivery of evidence satisfactory to Berkshire that such payment
has been made to such court or receiver, conservator, debtor-in-possession or
trustee in bankruptcy named in the Order.

 

	
  [U.S.
  Bank National Association,

  	
   

  
	
  not
  in its individual capacity,

  	
   

  
	
  but
  solely as Co-Trustee

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
  Title:]

  	
   

  
	
   

  	
   

  
	
  [Rocky
  Mountain Leasing Corporation

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
  Title:]

  	
   

  

 

 

Exhibit A

to

Demand for Avoided Payment

 

ASSIGNMENT

 

Reference
is made to the Participation Agreement (P1)
dated as of December 30, 1996, by and among (a) Oglethorpe Power
Corporation (An Electric Membership Corporation) (“Oglethorpe”), (b) Rocky
Mountain Leasing Corporation (“RMLC”), (c) U.S. Bank National
Association, successor in interest to SunTrust Bank, Atlanta, as Co-Trustee
(together with its successors and assigns, the “Facility Lessor”) under
the Facility Lease Agreement (P1) dated as of December 30, 1996 by and
between the Facility Lessor and RMLC, (d) U.S. Bank National Association,
successor in interest to Fleet National Bank, as Owner Trustee (e) Philip
Morris Capital Corporation (the “Owner Participant”), and (f) Utrecht-America
Finance Co. (as amended, modified, supplemented and in effect from time to
time, the “Participation Agreement”. 
Capitalized terms used herein and not otherwise defined are used herein
as defined in the Participation Agreement.

 

FOR
VALUE RECEIVED, [the Facility Lessor] /
[RMLC] hereby irrevocably assigns and transfers to Berkshire Hathaway
Assurance Corporation (the “Assignee”), (subject to (x) the rights
of the Lender as provided in the Loan Agreement, (y) any right, title and
interest that shall have been assigned to AMBAC, or to which AMBAC shall have
been subrogated, in accordance with the terms of the Implementation Agreement,
the AMBAC Surety Bond and the AMBAC Head Lease Surety Bond and (z) the
provisions of paragraph 11(f) of the Surety Bond), all rights and claims
other than Excluded Rights (collectively, the “Assigned Rights”) of the Facility Lessor and RMLC relating to
or arising under the Operative Documents against [AMBAC Assurance Corporation]
[Oglethorpe] or the estate thereof or otherwise with respect to the Avoided
Payment [and that portion of the Claimed Amount (as defined in the AMBAC Surety
Bond) remaining unpaid as of the date of the Demand for Avoided Payment
relating to such Avoided Payment](8) described below.  [RMLC represents
and warrants that it has not assigned such Assigned Rights or any
interest therein or other rights to relating thereto to any other Person (other
than to the RMLC Assignee pursuant to the Facility Sublease Assignment Agreement
and subject to any right, title and interest that shall have been assigned to
AMBAC, or to which AMBAC shall have been subrogated, in accordance with the
terms of the Implementation Agreement, the AMBAC Surety Bond and the AMBAC Head
Lease Surety Bond) and that no Facility Sublessor’s Lien exists thereon.] /
[The Facility Lessor represents and
warrants that it has not assigned such Assigned Rights or any interest
therein or other rights to relating thereto to any other Person (other than any
grant to the Lender of a security interest in any Assigned Rights or any
interest therein or other rights relating thereto under and as provided by the
Loan Agreement and subject to any right, title and interest that shall have
been assigned to AMBAC, or to which AMBAC shall have been subrogated, in
accordance with the terms of the Implementation Agreement, the AMBAC Surety
Bond and the AMBAC Head Lease Surety Bond) and that no Facility Lessor’s Lien
exists thereon.]

 

(8) Omit
if assignment relates to an Oglethorpe Avoided Payment.

 

 

The
Avoided Payment [and portion of the
Claimed Amount](9) covered by this Assignment is described as follows: 
[                ](10).

 

[It
is expressly understood and agreed that (a) this Assignment is executed
and delivered by U.S. Bank National Association, not individually or personally
but solely as Co-Trustee and Facility Lessor, (b) any representation,
undertaking or agreement herein made on the part of the Facility Lessor is made
and intended not as a personal representation, undertaking and agreement by
U.S. Bank National Association and (c) under no circumstances shall U.S.
Bank National Association be personally liable for the payment of any
indebtedness or expenses of the Facility Lessor or be liable for the breach or
failure of any obligation, representation, warranty or covenant made or
undertaken by Facility Lessor hereunder.]

 

[U.S. Bank National
Association, 

not in its individual capacity, 

but solely as Co-Trustee

 

	
  By:

  	
   

  	
   

  
	
  Title:]

  	
   

  
	
   

  	
   

  
	
  [Rocky
  Mountain Leasing Corporation

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
  Title:]

  	
   

  

 

	
  (9)

  	
  Omit
  if assignment relates to an Oglethorpe Avoided Payment.

  
	
  (10)

  	
  Include
  date of original payment(s), amounts paid, date of repayment, date repaid,
  and interest and other amounts constituting a part thereof. If assignment
  relates to an AMBAC Avoided Payment, include original Claimed Amount under
  AMBAC Surety Bond, date of demand therefor, and dates and amounts of payments
  (net of any AMBAC Avoided Payments) made with respect thereto.

  

 

 

Attachment III

(Facility Sublease-P1)

Surety Bond No. 98SRD102495

 

NOTICE OF TERMINATION

 

[Date]

 

Rocky Mountain Leasing Corporation

[                                                                  ]

[                                                                  ]

[                                                                  ]

 

U.S. Bank National Association, as Co-Trustee

[                                                                  ]

[                                                                  ]

[                                                                  ]

 

Philip Morris Capital Corporation

[                                                                  ]

[                                                                  ]

[                                                                  ]

 

Reference is made to the Surety Bond (Facility
Sublease-P1) No. 98SRD102495 (the “Surety
Bond”) issued by Berkshire Hathaway Assurance Corporation (“Berkshire”).  The terms which are capitalized herein and
not otherwise defined have the meanings specified in the Surety Bond unless the
context otherwise requires.

 

Berkshire hereby notifies the Facility Sublessor, the
Facility Lessor and the Owner Participant that (a) Berkshire has not
received the portion of the Premium due and payable in respect of the Surety
Bond on
[                                  ]
in the amount of
$[                  ]
(the “Unpaid Premium Amount”) and (b) as a result of such
non-payment, the Surety Bond will terminate effective 80 days after the date of
this notice (the “Cure Period”) unless Berkshire receives full payment
of the Unpaid Premium Amount prior to the expiration of the Cure Period.

 

Berkshire Hathaway
Assurance Corporation

 

	
  By:

  	
   

  	
   

  
	
  Title:

  	
   

  

 

 

Attachment IV

(Facility Sublease-P1)

Surety Bond No. 98SRD102495

 

NOTICE OF TERMINATION COVER
SHEET

(on red paper)

 

URGENT

 

THIS IS A NOTICE OF TERMINATION TO TERMINATE
SURETY BOND POLICY NO. 98SRD102495. 
PLEASE READ AND RESPOND.

 

THIS MAY BE AN EVENT OF DEFAULT.

 

 

Attachment V

(Facility Sublease-P1)

Surety Bond No. 98SRD102495

 

CONFIRMATION OF TRANSFER

 

Reference
is made to the Participation Agreement (P1)
dated as of December 30, 1996, by and among (a) Oglethorpe Power
Corporation (An Electric Membership Corporation) (“Oglethorpe”), (b) Rocky
Mountain Leasing Corporation (“RMLC”), (c) U.S. Bank National
Association, successor in interest to SunTrust Bank, Atlanta, as Co-Trustee
(together with its successors and assigns, the “Facility Lessor”) under
the Facility Lease Agreement (P1) dated as of December 30, 1996 by and
between the Facility Lessor and RMLC, (d) U.S. Bank National Association,
successor in interest to Fleet National Bank, as Owner Trustee (e) Philip
Morris Capital Corporation (the “Owner Participant”), and (f) Utrecht-America
Finance Co. (as amended, modified, supplemented and in effect from time to
time, the “Participation Agreement”. 
Capitalized terms used herein and not otherwise defined are used herein
as defined in the Participation Agreement or in the Surety Bond (Facility Sublease-P1)
No. 98SRD102495 issued by Berkshire Hathaway Assurance Corporation (the “Subrogee”).

 

FOR
VALUE RECEIVED, each of the Facility Lessor and RMLC hereby irrevocably assigns
and transfers to the Subrogee, and confirms the transfer and assignment to the
Subrogee, by subrogation or otherwise, of, all of the rights, interests, claims
and remedies of the Facility Lessor and/or
RMLC with respect to the Covered Obligations giving rise to any
Deficiency or Avoided Payment and/or comprising the balance of the Total
Outstanding Amount (as defined in any Demand for Payment or Demand for Avoided
Payment) under the Participation Agreement and the other Operative Documents
and all right, title and interest of the Head Lessee, the Facility Lessor, RMLC
and the RMLC Assignee (as defined in
the Surety Bond) under the Operative Documents (other than, in each and every
case, Excluded Rights and in each and every case, subject to (x) the
rights of the Lender as provided in the Loan Agreement, (y) any right,
title and interest that shall have been assigned to AMBAC, or to which AMBAC
shall have been subrogated, in accordance with the terms of the Implementation
Agreement, the AMBAC Surety Bond and the AMBAC Head Lease Surety Bond and (z) the
provisions of paragraph 11(f) of the Surety Bond).  RMLC represents
and warrants that it has not assigned such Covered Obligations or other rights
to any other Person (other than to the RMLC Assignee pursuant to the Facility
Sublease Assignment Agreement) and that no Facility Sublessor’s Lien exists
thereon.  The Facility Lessor represents
and warrants that it has not assigned such Covered Obligations or other rights
to any other Person (other than the grant to the Lender of a security interest
in such Covered Obligations and other rights under and as provided by the Loan
Agreement) that no Facility Lessor’s Lien exists thereon.

 

It
is expressly understood and agreed that (a) this Confirmation of Transfer
is executed and delivered by U.S. Bank National Association, not individually
or personally but solely as Co-Trustee and Facility
Lessor, (b) any representation, undertaking or agreement herein made on
the part of the Facility Lessor is made and intended not as a personal
representation, undertaking and agreement by U.S. Bank National Association and
(c) under no circumstances shall U.S. Bank National Association be
personally liable for the payment of any indebtedness or expenses 

 

 

of
the Facility Lessor or be liable for the breach or failure of any obligation,
representation, warranty or covenant made or undertaken by the Facility Lessor
hereunder.

 

U.S. Bank National
Association, 

not in its individual capacity, 

but solely as Co-Trustee

 

	
  By:

  	
   

  	
   

  
	
  Title:

  	
   

  
	
   

  	
   

  
	
  Rocky
  Mountain Leasing Corporation

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
  Title:

  	
   

  

 

 

SCHEDULE TO EXHIBIT 10.7

 

SURETY BOND IMPLEMENTATION AGREEMENT (P1)

 

The
following table indicates for each transaction the name of the corresponding
Owner Participant:

 

	
  Agreement

  	
   

  	
  Date

  	
   

  	
  Owner Participant

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  P2

  	
   

  	
  May 22, 2009

  	
   

  	
  Philip
  Morris Capital Corporation

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  F3

  	
   

  	
  May 22, 2009

  	
   

  	
  First
  Chicago Leasing Corporation

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  F4

  	
   

  	
  May 22, 2009

  	
   

  	
  First
  Chicago Leasing Corporation

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  N6

  	
   

  	
  May 22, 2009

  	
   

  	
  Philip
  Morris Capital Corporation

  (transferee from NationsBanc Leasing & R.E. Corporation)

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00159-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00159-of-00352.parquet"}]]