2ND Amendment To Leyte Optimization Project Bot

Exhibit 10.3.38 SECOND AMENDMENT TO LEYTE OPTIMIZATION PROJECT BOT AGREEMENT THIS SECOND AMENDMENT to LEYTE OPTIMIZATION PROJECT BOT AGREEMENT (this"Amendment") is made as of April 1, 1996, between PNOC-ENERGY DEVELOPMENTCORPORATION, a wholly owned subsidiary of the Philippine National Oil Company,organized and existing under Philippine law ("PNOC-EDC") and ORMAT LEYTE CO.LTD. a Philippine limited partnership ("Operator"). A. PNOC-EDC and ORMAT LEYTE CO. LTD., a Philippine Partnership executedthat certain Leyte Optimization Project BOT Agreement dated August 4, 1995 whichhas been assigned to the Operator (the "Original Agreement"), concerning thedevelopment and operation of a 49 MW (net) geothermal power productionfacilities in Leyte Province, the Philippines. All capitalized terms not definedherein shall have the meanings given them in the Original Agreement. B. PNOC-EDC and Operator each acknowledge that some but not all of theconditions to "Effectivity" of the Original Agreement set forth in Sections26.1, 26.2 and 26.3 of the Original Agreement have been fulfilled. C. PNOC-EDC and Operator recognize that additional time is needed in orderto fulfill the remaining conditions to Effectivity set forth in Sections 26.1,26.2 and 26.3 of the Original Agreement. D. Section 15.1 of the Original Agreement and its First Amendment provides,inter alia, that if by the Effectivity Date of April 10, 1996, one or more ofthe conditions set forth in Sections 26.1, 26.2 and 26.3 have not been fulfilledor waived by PNOC-EDC or the Operator, as the case may be, the parties shallconsult in good faith with a view to achieving Effectivity. Furthermore, Section3.1(a) states that if the Effectivity Date does not occur on or before April 10,1996, the parties shall discuss and agree on any further extension of the BidSecurity. E. PNOC-EDC and Operator wish to amend the Original Agreement and the BidSecurity as more fully set forth in this Amendment. NOW THEREFORE, the parties hereto, intending to be legally bound, and tobind their successors and assigns, agree as follows: 1. Amendment of Section 3.1(a) of the Original Agreement. Section 3.1(a) ofthe Original Agreement is hereby amended to read in its entirety as follows: (a) To guarantee the faithful performance by the Operator of its obligationto completely construct the Power Plant in accordance with the terms andconditions of this Agreement, within ten (10) days of the Effectivity Date theOperator shall post and deliver the Construction Performance Security in a formacceptable to PNOC-EDC in a sum equivalent to One Hundred Dollars (US $100) perkilowatt (kW) of total Contracted Capacity for all the Plants or its equivalentin Philippine Pesos or other currencies. Prior to such delivery, the Operatorshall ensure that the Bid Security required under the bid documents shall beextended until such time the Construction Performance Security shall have beenposted and delivered; provided that, in the event that the Effectivity Date doesnot occur on or before April 22, 1996, the parties shall discuss and agree onany further extension of the Bid Security. PNOC-EDC shall have recourse to theConstruction Performance Security to satisfy the final judgment in an arbitralproceeding in accordance with Article 21. 2. Amendment of Section 4.1(a) of the Original Agreement Section 4.1(a) ofthe Original Agreement is hereby amended to read in its entirety as follows: (a) The Operator shall in good faith use all reasonable efforts toconstruct the Power Plant in accordance with the following schedule:Activity DateTarget Effectivity Date April 22, 1996Ordering of long lead items the later of (i) July 1, 1996 or(turbogenerators) (ii) 120 days after the Effectivity DateStart of Commissioning Period May 1, 1997of Plants 1, 2 and 3Start of Commissioning Period October 1, 1997of Plant 4Scheduled Completion Date September 1, 1997 ...