Financial and Managerial Showing

Consolidated financial statements for Searles Valley Holdings, LLC and its subsidiaries are filed under seal. Financial statements for the SDWC are part of its Annual Report to the Public Utilities Commission.

Financial statements for Nirma have been submitted. The amounts listed in the financia1 statements are in India crore, rather than US dollars. A crore is 10 million rupees, and the rupee is currently trading at about 40 to the dollar, so Nirma's revenue of somewhat more than 2500 crore for the last fiscal year is on the order of $600 million US.

Karnavati is newly formed under Nirma. Applicants state that the financial statements for Nirma are provided to indicate that it is prepared to provide adequate financial support to SDWC in the unlikely event that SVMO is unable to do so. See Exhibit B describing the relationship.

SDWC possesses the technical capability to own, manage, operate, and maintain its existing public utility assets and will continue to do so unimpeded by this transaction. Karnavati plans to continue to staff the utility operations with professional, experienced operators and anticipates no changes to the current management and staff. SDWC is managed by a well-qualified management team. SDWC has both the technical and financial capability to maintain operations of the subject public utility assets in a safe and reliable manner and consistent with their existing authorized uses. As such, the proposed transaction is in the public interest.