Common use of Financing Improvements Clause in Contracts

Financing Improvements. Upon the request of the Facility Lessee delivered at least 90 days prior to financing a portion of the cost of any Required or Non-Severable Improvement, the Owner Lessor and the Indenture Trustee agree to cooperate with the Facility Lessee to (a) issue Additional Lessor Notes under the Collateral Trust Indenture to finance such Improvement which will rank pari passu with the Initial Lessor Notes and/or any Additional Lessor Notes then outstanding; (b) execute and deliver one or more supplements to the Collateral Trust Indenture for purpose of subjecting the Owner Lessor's interest in any such Improvements to the Liens thereof, and (c) execute and deliver an amendment to the Facility Lease to reflect the adjustments required by clause (iv) below; provided, however, that (x) the Owner Participant shall have been given the opportunity, but shall have no obligation, to provide all or part of the funds required to finance any such Improvement by making an Additional Equity Investment in such amount, if any, as it may determine in its sole and absolute discretion, but the Facility Lessee shall have no obligation to accept such Additional Equity Investment; and (y) the conditions set forth below and in Section 2.12 of the Collateral Trust Indenture shall have been satisfied. The obligation to finance such Improvements through the issuance of Additional Lessor Notes under Section 2.12 of the Collateral Trust Indenture (any financing of Improvements through the issuance of such Additional Lessor Notes under the Collateral Trust Indenture being called a "Supplemental Financing") is subject to the following additional conditions: except with respect to Required Improvements, there shall be no more than one such financing in any calendar year; the Additional Lessor Notes (A) shall have a final maturity no later than the final maturity of the Lessor Notes issued on the Closing Date and (B) will be fully repaid out of additional Basic Rent, as adjusted pursuant to the Facility Lease, during the Facility Lease Term; the Additional Lessor Notes shall have an average life to maturity equal to the average life to maturity of the Lessor Notes issued on the Closing Date; appropriate increases to Basic Rent and Termination Value (determined without regard to any tax benefits associated with such Improvements, unless the Owner Participant is making an Additional Equity Investment) shall be made to protect the Owner Participant's Net Economic Return; provided that there shall be no changes to the amortization schedule or interest amounts and payment dates on the then outstanding Lessor Notes; the Facility Lessee shall have paid, on an After-Tax Basis, all reasonable costs and expenses of the Transaction Parties, including the reasonable fees and expenses of counsel to the Owner Participant, the Owner Lessor, the Indenture Trustee, the Lease Indenture Company, the Pass Through Company and the Pass Through Trustees, in each case to the extent incurred in connection with any financing or refinancing pursuant to this Section 11 whether or not the financing is consummated; no Significant Lease Default or Lease Event of Default shall have occurred and be continuing unless the Improvements to be constructed with the proceeds of the Additional Lessor Notes shall cure such Significant Lease Default or Lease Event of Default and such Improvements shall be made in compliance with the Operative Documents and the South Point Ground Lease; such Additional Lessor Notes represent an aggregate amount not less than $20 million, nor greater than 100% of the costs of the Improvements being financed; provided that the aggregate balance of the Lessor Notes for the Undivided Interest never exceeds 80% of the fair market value (which fair market value shall be determined by an appraiser selected by the Facility Lessee and reasonably acceptable to the Owner Participant) of the Undivided Interest taking into account the fair market value of such Improvements; the Owner Participant shall have received a favorable opinion of its tax counsel satisfactory to such Owner Participant to the effect that such financing creates no incremental tax risk not indemnified to the Owner Participant's satisfaction (including additional indebtedness incurred to finance the Improvements not constituting "qualified nonrecourse indebtedness" within the meaning of Treasury Regulations Section 1-861-10T(b)); the Owner Participant shall suffer no adverse accounting effects under GAAP as a result of such financing; the Facility Lessee shall have made or delivered such representations, warranties, covenants, opinions or certificates as the Owner Participant or the Indenture Trustee may reasonably request; the Facility Lessee or the Guarantor shall have, at such time, a credit rating of at least Investment Grade from S&P and Moody's; the Facility Lessee shall pay to (a) the Owner Participanx x xxx of $100,000 and (b) the Pass Through Trustees for the benefit of the Certificateholders, to be shared by such Certificateholders on a pro rata basis, a fee of $100,000 for each such financing, in each case under clauses (a) and (b) above, other than the first financing; and Calpine shall have affirmed to the Transaction Parties that the Calpine Guaranties cover the additional indebtedness contemplated by this Section 11.1. Notwithstanding the prior provision dealing with the financing of Improvements through the Facility Lease, the Facility Lessee shall at all times have the right to fund Improvements to the Facility other than through the Facility Lease; provided that Required Improvements and non-Severable Improvements may only be financed other than through the Facility Lease on an unsecured basis. Notwithstanding any of the foregoing of this Section 11.1, except for Required Improvements and Improvements relating to pollution control, no Improvement shall materially decrease the value, residual value, utility or remaining economic useful life of the Facility immediately prior to such Improvement or cause the Facility to become limited-use property.

Financing Improvements. Upon the request of the Facility Lessee delivered at least 90 days prior to financing a portion of the cost of any Required or Non-Severable Improvement, the Owner Lessor and the Indenture Trustee agree to cooperate with the Facility Lessee to (a) issue Additional Lessor Notes under the Collateral Trust Indenture to finance such Improvement which will rank pari passu with the Initial Lessor Notes and/or any Additional Lessor Notes then outstanding; (b) execute and deliver one or more supplements to the Collateral Trust Indenture for purpose of subjecting the Owner Lessor's interest in any such Improvements to the Liens thereof, and (c) execute and deliver an amendment to the Facility Lease to reflect the adjustments required by clause (iv) below; provided, however, that (x) the Owner Participant shall have been given the opportunity, but shall have no obligation, to provide all or part of the funds required to finance any such Improvement by making an Additional Equity Investment in such amount, if any, as it may determine in its sole and absolute discretion, but the Facility Lessee shall have no obligation to accept such Additional Equity Investment; and (y) the conditions set forth below and in Section 2.12 of the Collateral Trust Indenture shall have been satisfied. The obligation to finance such Improvements through the issuance of Additional Lessor Notes under Section 2.12 of the Collateral Trust Indenture (any financing of Improvements through the issuance of such Additional Lessor Notes under the Collateral Trust Indenture being called a "Supplemental Financing") is subject to the following additional conditions: except with respect to Required Improvements, there shall be no more than one such financing in any calendar year; the Additional Lessor Notes (A) shall have a final maturity no later than the final maturity of the Lessor Notes issued on the Closing Date and (B) will be fully repaid out of additional Basic Rent, as adjusted pursuant to the Facility Lease, during the Facility Lease Term; the Additional Lessor Notes shall have an average life to maturity equal to the average life to maturity of the Lessor Notes issued on the Closing Date; appropriate increases to Basic Rent and Termination Value (determined without regard to any tax benefits associated with such Improvements, unless the Owner Participant is making an Additional Equity Investment) shall be made to protect the Owner Participant's Net Economic Return; provided that there shall be no changes to the amortization schedule or interest amounts and payment dates on the then outstanding Lessor Notes; the Facility Lessee shall have paid, on an After-Tax Basis, all reasonable costs and expenses of the Transaction Parties, including the reasonable fees and expenses of counsel to the Owner Participant, the Owner Lessor, the Indenture Trustee, the Lease Indenture Company, the Pass Through Company and the Pass Through Trustees, in each case to the extent incurred in connection with any financing or refinancing pursuant to this Section 11 whether or not the financing is consummated; no Significant Lease Default or Lease Event of Default shall have occurred and be continuing unless the Improvements to be constructed with the proceeds of the Additional Lessor Notes shall cure such Significant Lease Default or Lease Event of Default and such Improvements shall be made in compliance with the Operative Documents and the South Point Ground LeaseDocuments; such Additional Lessor Notes represent an aggregate amount not less than $20 million, nor greater than 100% of the costs of the Improvements being financed; provided that the aggregate balance of the Lessor Notes for the Undivided Interest never exceeds 80% of the fair market value (which fair market value shall be determined by an appraiser selected by the Facility Lessee and reasonably acceptable to the Owner Participant) of the Undivided Interest taking into account the fair market value of such Improvements; the Owner Participant shall have received a favorable opinion of its tax counsel satisfactory to such Owner Participant to the effect that such financing creates no incremental tax risk not indemnified to the Owner Participant's satisfaction (including additional indebtedness incurred to finance the Improvements not constituting "qualified nonrecourse indebtedness" within the meaning of Treasury Regulations Section 1-861-10T(b)); 63 the Owner Participant shall suffer no adverse accounting effects under GAAP as a result of such financing; the Facility Lessee shall have made or delivered such representations, warranties, covenants, opinions or certificates as the Owner Participant or Participant, the Indenture Trustee may reasonably request; the Facility Lessee or the Guarantor shall have, at such time, a credit rating of at least Investment Grade from S&P and Moody's; the Facility Lessee shall pay to (a) the Owner Participanx Participaxx x xxx xxe of $100,000 and (b) the Pass Through Trustees for the benefit of the Certificateholders, to be shared by such Certificateholders on a pro rata basis, a fee of $100,000 for each such financing, in each case under clauses (a) and (b) above, other than the first financing; and Calpine shall have affirmed to the Transaction Parties that the Calpine Guaranties cover the additional indebtedness contemplated by this Section 11.1. Notwithstanding the prior provision dealing with the financing of Improvements through the Facility Lease, the Facility Lessee shall at all times have the right to fund Improvements to the Facility other than through the Facility Lease; provided that Required Improvements and non-Severable Improvements may only be financed other than through the Facility Lease on an unsecured basis. Notwithstanding any of the foregoing of this Section 11.1, except for Required Improvements and Improvements relating to pollution control, no Improvement shall materially decrease the value, residual value, utility or remaining economic useful life of the Facility immediately prior to such Improvement or cause the Facility to become limited-use property.

Financing Improvements. (a) Upon the written request of the Facility Lessee Xxxxx City delivered at least 90 days prior to any proposed financing a portion of the cost of any Required or Non-Severable Improvement, the Owner Lessor and the Lease Indenture Trustee agree to cooperate with the Facility Lessee Xxxxx City to (ai) issue Additional Lessor Notes under the Collateral Trust Indenture to finance such Improvement Improvement, which will Additional Lessor Notes shall rank pari passu PARI PASSU with the Initial Lessor Notes and/or any Additional Lessor Notes then outstanding; (bii) execute and deliver one or more supplements to the Collateral Trust Lease Indenture for the purpose of subjecting the Owner Lessor's interest in any such Improvements to the Liens thereof, Security Interest; and (ciii) execute and deliver an amendment to the Facility Lease to reflect the adjustments required by clause subclause (iviii) below; provided, howeverPROVIDED HOWEVER, that (x) the Owner Participant shall have been given the opportunity, but shall have no obligation, to provide all or part of the funds required to finance the Owner Lessor's Percentage of any such Improvement by making an Additional Equity Investment in such amount, if any, as it may determine in its sole and absolute discretion, but the Facility Lessee Xxxxx City shall have no obligation to accept such Additional Equity Investment; and (y) the conditions set forth below and in Section 2.12 2.6 of the Collateral Trust Lease Indenture shall have been satisfied. The obligation to finance such Improvements through the issuance of Additional Lessor Notes under Section 2.12 2.6 of the Collateral Trust Lease Indenture (any financing of Improvements through the issuance of such Additional Lessor Notes under the Collateral Trust Lease Indenture being called a "Supplemental FinancingSUPPLEMENTAL FINANCING") is subject to the following additional conditions: except with respect to Required Improvements, there shall be no more than one such financing in any calendar year; the Additional Lessor Notes (A) shall have a final maturity no later than the final maturity of the Lessor Notes issued on the Closing Date and (B) will be fully repaid out of additional Basic Rent, as adjusted pursuant to the Facility Lease, during the Facility Lease Term; the Additional Lessor Notes shall have an average life to maturity equal to the average life to maturity of the Lessor Notes issued on the Closing Date; appropriate increases to Basic Rent and Termination Value (determined without regard to any tax benefits associated with such Improvements, unless the Owner Participant is making an Additional Equity Investment) shall be made to protect the Owner Participant's Net Economic Return; provided that there shall be no changes to the amortization schedule or interest amounts and payment dates on the then outstanding Lessor Notes; the Facility Lessee shall have paid, on an After-Tax Basis, all reasonable costs and expenses of the Transaction Parties, including the reasonable fees and expenses of counsel to the Owner Participant, the Owner Lessor, the Indenture Trustee, the Lease Indenture Company, the Pass Through Company and the Pass Through Trustees, in each case to the extent incurred in connection with any financing or refinancing pursuant to this Section 11 whether or not the financing is consummated; no Significant Lease Default or Lease Event of Default shall have occurred and be continuing unless the Improvements to be constructed with the proceeds of the Additional Lessor Notes shall cure such Significant Lease Default or Lease Event of Default and such Improvements shall be made in compliance with the Operative Documents and the South Point Ground Lease; such Additional Lessor Notes represent an aggregate amount not less than $20 million, nor greater than 100% of the costs of the Improvements being financed; provided that the aggregate balance of the Lessor Notes for the Undivided Interest never exceeds 80% of the fair market value (which fair market value shall be determined by an appraiser selected by the Facility Lessee and reasonably acceptable to the Owner Participant) of the Undivided Interest taking into account the fair market value of such Improvements; the Owner Participant shall have received a favorable opinion of its tax counsel satisfactory to such Owner Participant to the effect that such financing creates no incremental tax risk not indemnified to the Owner Participant's satisfaction (including additional indebtedness incurred to finance the Improvements not constituting "qualified nonrecourse indebtedness" within the meaning of Treasury Regulations Section 1-861-10T(b)); the Owner Participant shall suffer no adverse accounting effects under GAAP as a result of such financing; the Facility Lessee shall have made or delivered such representations, warranties, covenants, opinions or certificates as the Owner Participant or the Indenture Trustee may reasonably request; the Facility Lessee or the Guarantor shall have, at such time, a credit rating of at least Investment Grade from S&P and Moody's; the Facility Lessee shall pay to (a) the Owner Participanx x xxx of $100,000 and (b) the Pass Through Trustees for the benefit of the Certificateholders, to be shared by such Certificateholders on a pro rata basis, a fee of $100,000 for each such financing, in each case under clauses (a) and (b) above, other than the first financing; and Calpine shall have affirmed to the Transaction Parties that the Calpine Guaranties cover the additional indebtedness contemplated by this Section 11.1. Notwithstanding the prior provision dealing with the financing of Improvements through the Facility Lease, the Facility Lessee shall at all times have the right to fund Improvements to the Facility other than through the Facility Lease; provided that Required Improvements and non-Severable Improvements may only be financed other than through the Facility Lease on an unsecured basis. Notwithstanding any of the foregoing of this Section 11.1, except for Required Improvements and Improvements relating to pollution control, no Improvement shall materially decrease the value, residual value, utility or remaining economic useful life of the Facility immediately prior to such Improvement or cause the Facility to become limited-use property.:

Financing Improvements. Upon the request of the Facility Lessee delivered at least 90 days prior to financing a portion of the cost of any Required or Non-Severable Improvement, the Owner Lessor and the Indenture Trustee agree to cooperate with the Facility Lessee to (a) issue Additional Lessor Notes under the Collateral Trust Indenture to finance such Improvement which will rank pari passu with the Initial Lessor Notes and/or any Additional Lessor Notes then outstanding; (b) execute and deliver one or more supplements to the Collateral Trust Indenture for purpose of subjecting the Owner Lessor's interest Interest in any such Improvements to the Liens thereof, and (c) execute and deliver an amendment to the Facility Lease to reflect the adjustments required by clause (iv) below; provided, however, that (x) the Owner Participant shall have been given the opportunity, but shall have no obligation, to provide all or part of the funds required to finance any such Improvement by making an Additional Equity Investment in such amount, if any, as it may determine in its sole and absolute discretion, but the Facility Lessee shall have no obligation to accept such Additional Equity Investment; and (y) the conditions set forth below and in Section 2.12 of the Collateral Trust Indenture shall have been satisfied. The obligation to finance such Improvements through the issuance of Additional Lessor Notes under Section 2.12 of the Collateral Trust Indenture (any financing of Improvements through the issuance of such Additional Lessor Notes under the Collateral Trust Indenture being called a "Supplemental Financing") is subject to the following additional conditions: except with respect to Required Improvements, there shall be no more than one such financing in any calendar year; the Additional Lessor Notes (A) shall have a final maturity no later than the final maturity of the Lessor Notes issued on the Closing Date and (B) will be fully repaid out of additional Basic Rent, as adjusted pursuant to the Facility Lease, during the Facility Lease Term; the Additional Lessor Notes shall have an average life to maturity equal to the average life to maturity of the Lessor Notes issued on the Closing Date; appropriate increases to Basic Rent and Termination Value (determined without regard to any tax benefits associated with such Improvements, unless the Owner Participant is making an Additional Equity Investment) shall be made to protect the Owner Participant's Net Economic Return; provided that there shall be no changes to the amortization schedule or interest amounts and payment dates on the then outstanding Lessor Notes; the Facility Lessee shall have paid, on an After-Tax Basis, all reasonable costs and expenses of the Transaction Parties, including the reasonable fees and expenses of counsel to the Owner Participant, the Owner Lessor, the Indenture Trustee, the Lease Indenture Company, the Pass Through Company and the Pass Through Trustees, in each case to the extent incurred in connection with any financing or refinancing pursuant to this Section 11 whether or not the financing is consummated; no Significant Lease Default or Lease Event of Default shall have occurred and be continuing unless the Improvements to be constructed with the proceeds of the Additional Lessor Notes shall cure such Significant Lease Default or Lease Event of Default and such Improvements shall be made in compliance with the Operative Documents and the South Point Ground FILOT Lease; such Additional Lessor Notes represent an aggregate amount not less than $20 million, nor greater than 100% of the costs of the Improvements being financed; provided that the aggregate balance of the Lessor Notes for the Undivided Interest never exceeds 80% of the fair market value (which fair market value shall be determined by an appraiser selected by the Facility Lessee and reasonably acceptable to the Owner Participant) of the Undivided Interest taking into account the fair market value of such Improvements; the Owner Participant shall have received a favorable opinion of its tax counsel satisfactory to such Owner Participant to the effect that such financing creates no incremental tax risk not indemnified to the Owner Participant's satisfaction (including additional indebtedness incurred to finance the Improvements not constituting "qualified nonrecourse indebtedness" within the meaning of Treasury Regulations Section 1-861-10T(b)); the Owner Participant shall suffer no adverse accounting effects under GAAP as a result of such financing; the Facility Lessee shall have made or delivered such representations, warranties, covenants, opinions or certificates as the Owner Participant or Participant, the Indenture Trustee may reasonably request; the Facility Lessee or the Guarantor shall have, at such time, a credit rating of at least Investment Grade from S&P and Moody's; the Facility Lessee shall Lxxxxx xhall pay to (a) the Owner Participanx x xxx Participant a fee of $100,000 and (b) the Pass Through Trustees for the benefit of the Certificateholders, to be shared by such Certificateholders on a pro rata basis, a fee of $100,000 for each such financing, in each case under clauses (a) and (b) above, other than the first financing; and Calpine shall have affirmed to the Transaction Parties that the Calpine Guaranties cover the additional indebtedness contemplated by this Section 11.1. Notwithstanding the prior provision dealing with the financing of Improvements through the Facility Lease, the Facility Lessee shall at all times have the right to fund Improvements to the Facility other than through the Facility Lease; provided that Required Improvements and non-Severable Improvements may only be financed other than through the Facility Lease on an unsecured basis. Notwithstanding any of the foregoing of this Section 11.1, except for Required Improvements and Improvements relating to pollution control, no Improvement shall materially decrease the value, residual value, utility or remaining economic useful life of the Facility immediately prior to such Improvement or cause the Facility to become limited-use property.

Financing Improvements. (a) Upon the written request of the Facility Lessee delivered at least 90 days prior to any proposed financing a portion of the cost of any Required or Non-Severable Improvement, the Owner Lessor Lessor, the Lease Indenture Trustee and the Indenture each Pass Through Trustee agree to cooperate with the Facility Lessee to (ai) issue Additional Lessor Notes under the Collateral Trust Indenture to finance such Improvement which will rank pari passu with the Initial Lessor Notes and/or any Additional Lessor Notes then outstanding; (bii) execute and deliver one or more supplements to the Collateral Trust Lease Indenture for the purpose of subjecting the Owner Lessor's interest in any such Improvements to the Liens Lien thereof, ; and (ciii) execute and deliver an amendment to the Facility Lease to reflect the adjustments required by clause subclause (iviii) below; provided, provided however, that (x) the Owner Participant shall have been given the opportunity, but shall have no obligation, to provide all or part of the funds required to finance the Owner Lessor's Percentage of any such Improvement by making an Additional Equity Investment in such amount, if any, as it may determine in its sole and absolute discretion, but the Facility Lessee SEMA shall have no obligation to accept such Additional Equity Investment; and (y) the conditions set forth below and in Section 2.12 2.13 of the Collateral Trust Lease Indenture shall have been ------------ satisfied. The obligation to finance such Improvements through the issuance of Additional Lessor Notes under Section 2.12 2.13 of the Collateral Trust Lease Indenture (any financing ------------ of Improvements through the issuance of such Additional Lessor Notes under the Collateral Trust Lease Indenture being called a "Supplemental Financing") is subject to the ---------------------- limitations on incurrence of additional Indebtedness set forth in Section 6.7 ----------- and to the following additional conditions: except with respect to Required Improvements, there shall be no more than one such financing in any calendar year; the Additional Lessor Notes (A) shall have a final maturity no later than the final maturity of the Lessor Notes issued on the Closing Date and (B) will be fully repaid out of additional Basic Rent, as adjusted pursuant to the Facility Lease, during the Facility Lease Term; the Additional Lessor Notes shall have an average life to maturity equal to the average life to maturity of the Lessor Notes issued on the Closing Date; appropriate increases to Basic Rent and Termination Value (determined without regard to any tax benefits associated with such Improvements, unless the Owner Participant is making an Additional Equity Investment) shall be made to protect the Owner Participant's Net Economic Return; provided that there shall be no changes to the amortization schedule or interest amounts and payment dates on the then outstanding Lessor Notes; the Facility Lessee shall have paid, on an After-Tax Basis, all reasonable costs and expenses of the Transaction Parties, including the reasonable fees and expenses of counsel to the Owner Participant, the Owner Lessor, the Indenture Trustee, the Lease Indenture Company, the Pass Through Company and the Pass Through Trustees, in each case to the extent incurred in connection with any financing or refinancing pursuant to this Section 11 whether or not the financing is consummated; no Significant Lease Default or Lease Event of Default shall have occurred and be continuing unless the Improvements to be constructed with the proceeds of the Additional Lessor Notes shall cure such Significant Lease Default or Lease Event of Default and such Improvements shall be made in compliance with the Operative Documents and the South Point Ground Lease; such Additional Lessor Notes represent an aggregate amount not less than $20 million, nor greater than 100% of the costs of the Improvements being financed; provided that the aggregate balance of the Lessor Notes for the Undivided Interest never exceeds 80% of the fair market value (which fair market value shall be determined by an appraiser selected by the Facility Lessee and reasonably acceptable to the Owner Participant) of the Undivided Interest taking into account the fair market value of such Improvements; the Owner Participant shall have received a favorable opinion of its tax counsel satisfactory to such Owner Participant to the effect that such financing creates no incremental tax risk not indemnified to the Owner Participant's satisfaction (including additional indebtedness incurred to finance the Improvements not constituting "qualified nonrecourse indebtedness" within the meaning of Treasury Regulations Section 1-861-10T(b)); the Owner Participant shall suffer no adverse accounting effects under GAAP as a result of such financing; the Facility Lessee shall have made or delivered such representations, warranties, covenants, opinions or certificates as the Owner Participant or the Indenture Trustee may reasonably request; the Facility Lessee or the Guarantor shall have, at such time, a credit rating of at least Investment Grade from S&P and Moody's; the Facility Lessee shall pay to (a) the Owner Participanx x xxx of $100,000 and (b) the Pass Through Trustees for the benefit of the Certificateholders, to be shared by such Certificateholders on a pro rata basis, a fee of $100,000 for each such financing, in each case under clauses (a) and (b) above, other than the first financing; and Calpine shall have affirmed to the Transaction Parties that the Calpine Guaranties cover the additional indebtedness contemplated by this Section 11.1. Notwithstanding the prior provision dealing with the financing of Improvements through the Facility Lease, the Facility Lessee shall at all times have the right to fund Improvements to the Facility other than through the Facility Lease; provided that Required Improvements and non-Severable Improvements may only be financed other than through the Facility Lease on an unsecured basis. Notwithstanding any of the foregoing of this Section 11.1, except for Required Improvements and Improvements relating to pollution control, no Improvement shall materially decrease the value, residual value, utility or remaining economic useful life of the Facility immediately prior to such Improvement or cause the Facility to become limited-use property.:

Financing Improvements. (a) Upon the written request of the Facility Lessee delivered at least 90 days prior to any proposed financing a portion of the cost of any Required or Non-Non- Severable Improvement, the Owner Lessor Lessor, the Lease Indenture Trustee and the Indenture each Pass Through Trustee agree to cooperate with the Facility Lessee to (ai) issue Additional Lessor Notes under the Collateral Trust Indenture to finance such Improvement which XXXXXXXXX PARTICIPATION AGREEMENT (L1) -------------------------------------- will rank pari passu with the Initial Lessor Notes and/or any Additional Lessor Notes then outstanding; (bii) execute and deliver one or more supplements to the Collateral Trust Lease Indenture for the purpose of subjecting the Owner Lessor's interest in any such Improvements to the Liens Lien thereof, ; and (ciii) execute and deliver an amendment to the Facility Lease to reflect the adjustments required by clause subclause (iviii) below; provided, provided however, that (x) the Owner Participant shall have been given the opportunity, but shall have no obligation, to provide all or part of the funds required to finance the Owner Lessor's Percentage of any such Improvement by making an Additional Equity Investment in such amount, if any, as it may determine in its sole and absolute discretion, but the Facility Lessee SEMA shall have no obligation to accept such Additional Equity Investment; and (y) the conditions set forth below and in Section 2.12 2.13 of the Collateral Trust Lease Indenture shall have been ------------ satisfied. The obligation to finance such Improvements through the issuance of Additional Lessor Notes under Section 2.12 2.13 of the Collateral Trust Lease Indenture (any financing ------------ of Improvements through the issuance of such Additional Lessor Notes under the Collateral Trust Lease Indenture being called a "Supplemental Financing") is subject to the ---------------------- limitations on incurrence of additional Indebtedness set forth in Section 6.7 ----------- and to the following additional conditions: except with respect to Required Improvements, there shall be no more than one such financing in any calendar year; the Additional Lessor Notes (A) shall have a final maturity no later than the final maturity of the Lessor Notes issued on the Closing Date and (B) will be fully repaid out of additional Basic Rent, as adjusted pursuant to the Facility Lease, during the Facility Lease Term; the Additional Lessor Notes shall have an average life to maturity equal to the average life to maturity of the Lessor Notes issued on the Closing Date; appropriate increases to Basic Rent and Termination Value (determined without regard to any tax benefits associated with such Improvements, unless the Owner Participant is making an Additional Equity Investment) shall be made to protect the Owner Participant's Net Economic Return; provided that there shall be no changes to the amortization schedule or interest amounts and payment dates on the then outstanding Lessor Notes; the Facility Lessee shall have paid, on an After-Tax Basis, all reasonable costs and expenses of the Transaction Parties, including the reasonable fees and expenses of counsel to the Owner Participant, the Owner Lessor, the Indenture Trustee, the Lease Indenture Company, the Pass Through Company and the Pass Through Trustees, in each case to the extent incurred in connection with any financing or refinancing pursuant to this Section 11 whether or not the financing is consummated; no Significant Lease Default or Lease Event of Default shall have occurred and be continuing unless the Improvements to be constructed with the proceeds of the Additional Lessor Notes shall cure such Significant Lease Default or Lease Event of Default and such Improvements shall be made in compliance with the Operative Documents and the South Point Ground Lease; such Additional Lessor Notes represent an aggregate amount not less than $20 million, nor greater than 100% of the costs of the Improvements being financed; provided that the aggregate balance of the Lessor Notes for the Undivided Interest never exceeds 80% of the fair market value (which fair market value shall be determined by an appraiser selected by the Facility Lessee and reasonably acceptable to the Owner Participant) of the Undivided Interest taking into account the fair market value of such Improvements; the Owner Participant shall have received a favorable opinion of its tax counsel satisfactory to such Owner Participant to the effect that such financing creates no incremental tax risk not indemnified to the Owner Participant's satisfaction (including additional indebtedness incurred to finance the Improvements not constituting "qualified nonrecourse indebtedness" within the meaning of Treasury Regulations Section 1-861-10T(b)); the Owner Participant shall suffer no adverse accounting effects under GAAP as a result of such financing; the Facility Lessee shall have made or delivered such representations, warranties, covenants, opinions or certificates as the Owner Participant or the Indenture Trustee may reasonably request; the Facility Lessee or the Guarantor shall have, at such time, a credit rating of at least Investment Grade from S&P and Moody's; the Facility Lessee shall pay to (a) the Owner Participanx x xxx of $100,000 and (b) the Pass Through Trustees for the benefit of the Certificateholders, to be shared by such Certificateholders on a pro rata basis, a fee of $100,000 for each such financing, in each case under clauses (a) and (b) above, other than the first financing; and Calpine shall have affirmed to the Transaction Parties that the Calpine Guaranties cover the additional indebtedness contemplated by this Section 11.1. Notwithstanding the prior provision dealing with the financing of Improvements through the Facility Lease, the Facility Lessee shall at all times have the right to fund Improvements to the Facility other than through the Facility Lease; provided that Required Improvements and non-Severable Improvements may only be financed other than through the Facility Lease on an unsecured basis. Notwithstanding any of the foregoing of this Section 11.1, except for Required Improvements and Improvements relating to pollution control, no Improvement shall materially decrease the value, residual value, utility or remaining economic useful life of the Facility immediately prior to such Improvement or cause the Facility to become limited-use property.:

Financing Improvements. (a) Upon the written request of the Facility Lessee Xxxxx City delivered at least 90 days prior to any proposed financing a portion of the cost of any Required or Non-Severable Improvement, the Owner Lessor and the Lease Indenture Trustee agree to cooperate with the Facility Lessee Xxxxx City to (ai) issue Additional Lessor Notes under the Collateral Trust Indenture to finance such Improvement Improvement, which will Additional Lessor Notes shall rank pari passu with the Initial Lessor Notes and/or any Additional Lessor Notes then outstanding; (bii) execute and deliver one or more supplements to the Collateral Trust Lease Indenture for the purpose of subjecting the Owner Lessor's interest in any such Improvements to the Liens thereof, Security Interest; and (ciii) execute and deliver an amendment to the Facility Lease to reflect the adjustments required by clause subclause (iviii) below; provided, provided however, that (x) the Owner Participant shall have been given the opportunity, but shall have no obligation, to provide all or part of the funds required to finance the Owner Lessor's Percentage of any such Improvement by making an Additional Equity Investment in such amount, if any, as it may determine in its sole and absolute discretion, but the Facility Lessee Xxxxx City shall have no obligation to accept such Additional Equity Investment; and (y) the conditions set forth below and in Section 2.12 2.6 of the Collateral Trust Lease Indenture shall have been satisfied. The obligation to finance such Improvements through the issuance of Additional Lessor Notes under Section 2.12 2.6 of the Collateral Trust Lease Indenture (any financing of Improvements through the issuance of such Additional Lessor Notes under the Collateral Trust Lease Indenture being called a "Supplemental Financing") is subject to the following additional conditions: except with respect to Required Improvements, there shall be no more than one such financing in any calendar year; the Additional Lessor Notes (A) shall have a final maturity no later than the final maturity of the Lessor Notes issued on the Closing Date and (B) will be fully repaid out of additional Basic Rent, as adjusted pursuant to the Facility Lease, during the Facility Lease Term; the Additional Lessor Notes shall have an average life to maturity equal to the average life to maturity of the Lessor Notes issued on the Closing Date; appropriate increases to Basic Rent and Termination Value (determined without regard to any tax benefits associated with such Improvements, unless the Owner Participant is making an Additional Equity Investment) shall be made to protect the Owner Participant's Net Economic Return; provided that there shall be no changes to the amortization schedule or interest amounts and payment dates on the then outstanding Lessor Notes; the Facility Lessee shall have paid, on an After-Tax Basis, all reasonable costs and expenses of the Transaction Parties, including the reasonable fees and expenses of counsel to the Owner Participant, the Owner Lessor, the Indenture Trustee, the Lease Indenture Company, the Pass Through Company and the Pass Through Trustees, in each case to the extent incurred in connection with any financing or refinancing pursuant to this Section 11 whether or not the financing is consummated; no Significant Lease Default or Lease Event of Default shall have occurred and be continuing unless the Improvements to be constructed with the proceeds of the Additional Lessor Notes shall cure such Significant Lease Default or Lease Event of Default and such Improvements shall be made in compliance with the Operative Documents and the South Point Ground Lease; such Additional Lessor Notes represent an aggregate amount not less than $20 million, nor greater than 100% of the costs of the Improvements being financed; provided that the aggregate balance of the Lessor Notes for the Undivided Interest never exceeds 80% of the fair market value (which fair market value shall be determined by an appraiser selected by the Facility Lessee and reasonably acceptable to the Owner Participant) of the Undivided Interest taking into account the fair market value of such Improvements; the Owner Participant shall have received a favorable opinion of its tax counsel satisfactory to such Owner Participant to the effect that such financing creates no incremental tax risk not indemnified to the Owner Participant's satisfaction (including additional indebtedness incurred to finance the Improvements not constituting "qualified nonrecourse indebtedness" within the meaning of Treasury Regulations Section 1-861-10T(b)); the Owner Participant shall suffer no adverse accounting effects under GAAP as a result of such financing; the Facility Lessee shall have made or delivered such representations, warranties, covenants, opinions or certificates as the Owner Participant or the Indenture Trustee may reasonably request; the Facility Lessee or the Guarantor shall have, at such time, a credit rating of at least Investment Grade from S&P and Moody's; the Facility Lessee shall pay to (a) the Owner Participanx x xxx of $100,000 and (b) the Pass Through Trustees for the benefit of the Certificateholders, to be shared by such Certificateholders on a pro rata basis, a fee of $100,000 for each such financing, in each case under clauses (a) and (b) above, other than the first financing; and Calpine shall have affirmed to the Transaction Parties that the Calpine Guaranties cover the additional indebtedness contemplated by this Section 11.1. Notwithstanding the prior provision dealing with the financing of Improvements through the Facility Lease, the Facility Lessee shall at all times have the right to fund Improvements to the Facility other than through the Facility Lease; provided that Required Improvements and non-Severable Improvements may only be financed other than through the Facility Lease on an unsecured basis. Notwithstanding any of the foregoing of this Section 11.1, except for Required Improvements and Improvements relating to pollution control, no Improvement shall materially decrease the value, residual value, utility or remaining economic useful life of the Facility immediately prior to such Improvement or cause the Facility to become limited-use property.:

Financing Improvements. (a) Upon the written request of the Facility Lessee Xxxxx City delivered at least 90 days prior to any proposed financing a portion of the cost of any Required or Non-Severable Improvement, the Owner Lessor and the Lease Indenture Trustee agree to cooperate with the Facility Lessee Xxxxx City to (ai) issue Additional Lessor Notes under the Collateral Trust Indenture to finance such Improvement Improvement, which will Additional Lessor Notes shall rank pari passu PARI PASSU with the Initial Lessor Notes and/or any Additional Lessor Notes then outstanding; (bii) execute and deliver one or more supplements to the Collateral Trust Lease Indenture for the purpose of subjecting the Owner Lessor's interest in any such Improvements to the Liens thereof, Security Interest; and (ciii) execute and deliver an amendment to the Facility Lease to reflect the adjustments required by clause subclause (iviii) below; provided, howeverPROVIDED HOWEVER, that (x) the Owner Participant shall have been given the opportunity, but shall have no obligation, to provide all or part of the funds required to finance the Owner Lessor's Percentage of any such Improvement by making an Additional Equity Investment in such amount, if any, as it may determine in its sole and absolute discretion, but the Facility Lessee Xxxxx City shall have no obligation to accept such Additional Equity Investment; and (y) the conditions set forth below and in [Section 2.12 2.13] of the Collateral Trust Lease Indenture shall have been satisfied. The obligation to finance such Improvements through the issuance of Additional Lessor Notes under [Section 2.12 2.13] of the Collateral Trust Lease Indenture (any financing of Improvements through the issuance of such Additional Lessor Notes under the Collateral Trust Lease Indenture being called a "Supplemental FinancingSUPPLEMENTAL FINANCING") is subject to the following additional conditions: except with respect to Required Improvements, there shall be no more than one such financing in any calendar year; the Additional Lessor Notes (A) shall have a final maturity no later than the final maturity of the Lessor Notes issued on the Closing Date and (B) will be fully repaid out of additional Basic Rent, as adjusted pursuant to the Facility Lease, during the Facility Lease Term; the Additional Lessor Notes shall have an average life to maturity equal to the average life to maturity of the Lessor Notes issued on the Closing Date; appropriate increases to Basic Rent and Termination Value (determined without regard to any tax benefits associated with such Improvements, unless the Owner Participant is making an Additional Equity Investment) shall be made to protect the Owner Participant's Net Economic Return; provided that there shall be no changes to the amortization schedule or interest amounts and payment dates on the then outstanding Lessor Notes; the Facility Lessee shall have paid, on an After-Tax Basis, all reasonable costs and expenses of the Transaction Parties, including the reasonable fees and expenses of counsel to the Owner Participant, the Owner Lessor, the Indenture Trustee, the Lease Indenture Company, the Pass Through Company and the Pass Through Trustees, in each case to the extent incurred in connection with any financing or refinancing pursuant to this Section 11 whether or not the financing is consummated; no Significant Lease Default or Lease Event of Default shall have occurred and be continuing unless the Improvements to be constructed with the proceeds of the Additional Lessor Notes shall cure such Significant Lease Default or Lease Event of Default and such Improvements shall be made in compliance with the Operative Documents and the South Point Ground Lease; such Additional Lessor Notes represent an aggregate amount not less than $20 million, nor greater than 100% of the costs of the Improvements being financed; provided that the aggregate balance of the Lessor Notes for the Undivided Interest never exceeds 80% of the fair market value (which fair market value shall be determined by an appraiser selected by the Facility Lessee and reasonably acceptable to the Owner Participant) of the Undivided Interest taking into account the fair market value of such Improvements; the Owner Participant shall have received a favorable opinion of its tax counsel satisfactory to such Owner Participant to the effect that such financing creates no incremental tax risk not indemnified to the Owner Participant's satisfaction (including additional indebtedness incurred to finance the Improvements not constituting "qualified nonrecourse indebtedness" within the meaning of Treasury Regulations Section 1-861-10T(b)); the Owner Participant shall suffer no adverse accounting effects under GAAP as a result of such financing; the Facility Lessee shall have made or delivered such representations, warranties, covenants, opinions or certificates as the Owner Participant or the Indenture Trustee may reasonably request; the Facility Lessee or the Guarantor shall have, at such time, a credit rating of at least Investment Grade from S&P and Moody's; the Facility Lessee shall pay to (a) the Owner Participanx x xxx of $100,000 and (b) the Pass Through Trustees for the benefit of the Certificateholders, to be shared by such Certificateholders on a pro rata basis, a fee of $100,000 for each such financing, in each case under clauses (a) and (b) above, other than the first financing; and Calpine shall have affirmed to the Transaction Parties that the Calpine Guaranties cover the additional indebtedness contemplated by this Section 11.1. Notwithstanding the prior provision dealing with the financing of Improvements through the Facility Lease, the Facility Lessee shall at all times have the right to fund Improvements to the Facility other than through the Facility Lease; provided that Required Improvements and non-Severable Improvements may only be financed other than through the Facility Lease on an unsecured basis. Notwithstanding any of the foregoing of this Section 11.1, except for Required Improvements and Improvements relating to pollution control, no Improvement shall materially decrease the value, residual value, utility or remaining economic useful life of the Facility immediately prior to such Improvement or cause the Facility to become limited-use property.: