INTEREST EXPENSE
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ACKNOWLEDGEMENT
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This Interest Expense Acknowledgement (the "Acknowledgement") is made as
of this 30th day of August 2005 by and between Enron Wind Systems, LLC, a
California limited liability company ("EWS"), and Zond Windsytem Partners, Ltd.
Series 85-C, a California limited partnership (the "Partnership").
RECITALS
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A. WHEREAS, EWS is the assignee under and holder of those certain
promissory notes made by the Partnership described on Exhibit A attached hereto
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(collectively, the "Promissory Notes"), which Promissory Notes were previously
held by ZWHC LLC as successor to Zond Construction Corporation IV.
B. WHEREAS, since January 1, 1996 neither ZWHC LLC nor EWS has required
and the Partnership has not paid any interest on the outstanding principal of
the Promissory Notes other than the interest set forth on the amortization
schedules that are attached to the Promissory Notes, as amended (the
"Amortization Schedules").
C. WHEREAS, the parties have been unable to locate the written
documentation, if any, that memorializes the arrangement described in Recital B
above relating to the payment of interest on the Promissory Notes for the period
on and after January 1, 1996 and they desire to acknowledge, confirm and
memorialize such arrangement pursuant to this Acknowledgement.
NOW, THEREFORE, it is hereby acknowledged and confirmed as follows:
ACKNOWLEDGEMENT
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1. Interest Payments Due Under the Promissory Notes. The parties hereby
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acknowledge, confirm and agree that, with respect to interest payable under the
Promissory Notes since January 1, 1996, the Partnership has been and is required
to pay only that interest set forth on the Amortization Schedules. Without
limiting the generality of the foregoing, the Partnership has not been and is
not required to pay any additional or other interest, except the interest set
forth on the Amortization Schedules, with respect to (i) the portion of the
annual principal payments that was due and unpaid under the Promissory Notes at
the end of any calendar year from 1996 through 2001 and (ii) any principal
balance of the Promissory Notes outstanding at any time after the maturity date
of the Promissory Notes, either pursuant to the agreement acknowledged herein or
otherwise.
2. Principal Payments Under the Promissory Notes. The parties hereby
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acknowledge that during the calendar years 1996 through 2001 the Partnership did
not pay all of the regularly scheduled principal payments due under the
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Promissory Notes and, notwithstanding the maturity of the Promissory Notes in
December 2001, the Partnership has not paid all of the outstanding principal
balance on the Promissory Notes. The Partnership acknowledges that (i) it is in
default under the Promissory Notes, (ii) such outstanding principal balance on
the Promissory Notes is due and payable to EWS and (iii) the payment of such
outstanding principal balance has not been waived, forgiven or reduced in any
manner by EWS, either pursuant to this Acknowledgement or otherwise.
3. Miscellaneous Provisions.
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3.1 Further Assurances. The parties agree to perform all such acts
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(including, without limitation, executing and delivering instruments and
documents) as reasonably may be necessary to effectuate fully the intent and
each and all of the purposes of the agreement acknowledged in this
Acknowledgement.
3.2 Governing Law. This Acknowledgement shall be governed by and
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construed in accordance with the laws of the State of California.
3.3 Successors and Assigns. The agreement acknowledged in this
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Acknowledgement shall be binding upon and shall inure to the benefit of the
parties hereto and their respective transferees, successors and assigns.
3.4 Counterparts. This Acknowledgement may be executed in
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counterparts, each of which shall be deemed an original, when executed,
separately or together, and all of such counterparts shall constitute a single
original instrument, effective in the same manner as if all parties hereto had
executed one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this Acknowledgement
to be duly executed as of the date hereinabove first written.
EWS Partnership
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Enron Wind Systems, LLC Zond Windsystem Partners, Ltd. Series
85-C, a California limited partnership
By: Enron Wind Domestic Holding
LLC, its sole member
By: Enron Wind LLC, its sole member By: Zond Windsystems Management V
By: Enron Renewable Energy Corp., LLC, its general partner
its sole member
By: /s/ Xxxx X. Xxxx By: /s/ Xxxx X. Xxxx
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Name: Xxxx X. Xxxx Name: Xxxx X. Xxxx
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Title: President and CEO Title: President and CEO
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Address Address
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1221 Xxxxx 0000 Xxxxx
Xxxxx 0000 Xxxxx 0000
Xxxxxxx, XX 00000 Xxxxxxx, XX 00000
Agreed to and acknowledged by:
ZWHC LLC
By: Enron Wind Systems, LLC, its sole
member
By: Enron Wind Domestic Holding
LLC, its sole member
By: Enron Wind LLC, its sole member
By: Enron Renewable Energy Corp., its
sole member
By: /s/ Xxxx X. Xxxx
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Name: Xxxx X. Xxxx
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Title: President and CEO
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Exhibit A
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Promissory Notes
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1. Series C Promissory Note dated as of December 23, 1985 in the amount of
$7,920,000 issued by the Partnership to Zond Construction Corporation IV
("ZCC").
2. Series C Promissory Note dated as of December 27, 1985 in the amount of
$7,920,000 issued by the Partnership in favor of ZCC.
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