(Execution Copy)
CENTENNIAL ENERGY HOLDINGS, INC.
$450,000,000
Senior Notes
__________
AMENDED AND RESTATED MASTER SHELF AGREEMENT
__________
Dated as of December 27, 1999
(effective as of April 29, 2005)
Note: This Agreement contains confidentiality obligations:
Section 20
TABLE OF CONTENTS
1. RESTATEMENT AND AMENDMENT; AUTHORIZATION OF NOTES
1.1. Restatement and Amendment of Existing Agreement
1.2. Authorization of Issue of Notes
2. SALE AND PURCHASE OF NOTES
2.1. Facility
2.2. Issuance Period
2.3. Periodic Spread Information
2.4. Request for Purchase
2.5. Rate Quotes
2.6. Acceptance
2.7. Market Disruption
2.8. Fees
3. CLOSING
3.1. Closings
3.2. Rescheduled Closings
4. CONDITIONS TO CLOSING
4.1. Representations and Warranties
4.2. Performance; No Default
4.3. Compliance Certificates
4.4. Opinions of Counsel
4.5. Purchase Permitted By Applicable Law, etc
4.6. Payment of Facility Fee and Structuring Fee
4.7. Private Placement Number
4.8. Changes in Corporate Structure
4.9. Certain Documents
4.10.Proceedings and Documents
5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY
5.1. Organization; Power and Authority
5.2. Authorization, etc
5.3. Disclosure
5.4. Organization and Ownership of Shares of Subsidiaries; Affiliates
5.5. Financial Statements
5.6. Compliance with Laws, Other Instruments, etc
5.7. Governmental Authorizations, etc
5.8. Litigation; Observance of Agreements, Statutes and Orders
5.9. Taxes
5.10.Title to Property; Leases
5.11.Licenses, Permits, etc
5.12.Compliance with ERISA
5.13.Private Offering by the Company
5.14.Use of Proceeds; Margin Regulations
5.15.Existing Indebtedness; Future Liens
5.16.Status under Certain Statutes
5.17.Environmental Matters
5.18.Hostile Tender Offers
5.19.Foreign Assets Control Regulations, Etc
6. REPRESENTATIONS OF THE PURCHASER
6.1. Purchase for Investment
6.2. Source of Funds
7. INFORMATION AS TO COMPANY
7.1. Financial and Business Information
7.2. Officer's Certificate
7.3. Inspection
8. PREPAYMENT OF THE NOTES
8.1. Required Prepayments
8.2. Optional Prepayments with Make-Whole Amount
8.3. Allocation of Partial Prepayments
8.4. Maturity; Surrender, etc
8.5. Purchase of Notes
8.6. Make-Whole Amount
9. AFFIRMATIVE COVENANTS
9.1. Compliance with Law
9.2. Insurance
9.3. Maintenance of Properties
9.4. Payment of Taxes
9.5. Corporate Existence, etc
9.6. Information Required by Rule 144A
9.7. Covenant to Secure Notes Equally
10. NEGATIVE COVENANTS
10.1. Maximum Company Capitalization Ratio
10.2. Minimum Interest Coverage Ratio
10.3. Consolidated Net Worth
10.4. Limitation on Liens
10.5. Limitation on Priority Debt
10.6. Limitation on Sale of Assets
10.7. Consolidations and Mergers
10.8. Loans and Investments
10.9. Transactions with Affiliates
10.10.Use of Proceeds
10.11.Agreements Restricting Subsidiary Dividends
10.12.Restrictions on Subsidiary Guarantees
10.13.Terrorism Sanctions Regulations
11. EVENTS OF DEFAULT
12. REMEDIES ON DEFAULT, ETC
12.1. Acceleration
12.2. Other Remedies
12.3. Rescission
12.4. No Waivers or Election of Remedies, Expenses, etc
13. REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES
13.1. Registration of Notes
13.2. Transfer and Exchange of Notes
13.3. Replacement of Notes
14. PAYMENTS ON NOTES
14.1. Place of Payment
14.2. Home Office Payment
15. EXPENSES, ETC
15.1. Transaction Expenses
15.2. Survival
16. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT
17. AMENDMENT AND WAIVER
17.1. Requirements
17.2. Solicitation of Holders of Notes
17.3. Binding Effect, etc
17.4. Notes held by Company, etc
18. NOTICES
19. REPRODUCTION OF DOCUMENTS
20. CONFIDENTIAL INFORMATION
21. SUBSTITUTION OF PURCHASER
22. MISCELLANEOUS
22.1. Successors and Assigns
22.2. Payments Due on Non-Business Days
22.3. Severability
22.4. Construction
22.5. Counterparts
22.6. Governing Law
23.CONDITIONS TO EFFECTIVENESS
23.1. Secretary's Certificate
23.2. Opinion of Counsel
SCHEDULE A -- Information Relating to Purchaser
SCHEDULE B -- Defined Terms
SCHEDULE 5.4 -- Subsidiaries of the Company and Ownership of
Subsidiary Stock
SCHEDULE 5.8 -- Litigation
SCHEDULE 5.10 -- Title to Property
SCHEDULE 5.15 -- Existing Indebtedness; Liens
SCHEDULE 5.17 -- Environmental Matters
EXHIBIT 1 -- Form of Senior Note
EXHIBIT 2.4 -- Form of Request for Purchaser
EXHIBIT 2.6 -- Form of Confirmation of Acceptance
EXHIBIT 4.4(a) -- Form of Opinion of Counsel to the Company
EXHIBIT 4.4(b) -- Form of Opinion of General Counsel of the Company
CENTENNIAL ENERGY HOLDINGS, INC.
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As of December 27, 1999
(effective as of April 29, 2005)
To: Prudential Investment Management, Inc. ("Prudential")
The Prudential Insurance Company of America ("PICA")
Pruco Life Insurance Company
Pruco Life Insurance Company of New Jersey
Hartford Life Insurance Company
Southland Life Insurance Company
First Colony Life Insurance Company
General Electric Capital Assurance Company
General Electric Life Annuity Assurance Company
Each Prudential Affiliate (as defined herein)
which becomes bound by certain provisions of this
Agreement as hereinafter provided (together with
each above-named entity, the "Purchasers")
c/o Prudential Capital Group
Gateway Center Four
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Ladies and Gentlemen:
Centennial Energy Holdings, Inc., a Delaware
corporation (the "Company"), agrees with you as follows:
1. RESTATEMENT AND AMENDMENT; AUTHORIZATION OF NOTES.
1.1. Restatement and Amendment of Existing Agreement. The
Company and PICA entered into a Master Shelf Agreement dated as
of December 27, 1999 (the "Original Agreement"), as amended by
Letter Amendment No. 1 dated May 4, 2000, Letter Amendment No. 2
dated September 29, 2000, Letter Amendment No. 3 dated September
4, 2001, Letter Amendment No. 4 dated October 1, 2002 and Letter
Amendment No. 5 dated December 15, 2004. (The Original
Agreement, as amended, is referred to herein as the "Existing
Agreement".) The Company, Prudential and each holder of Notes
outstanding under the Existing Agreement desire to, among other
things, amend certain provisions of the Existing Agreement
including, without limitation, to increase the size of the
Facility from $400,000,000 to $450,000,000 and extend the period
during which Notes may be issued. Accordingly, the Company,
Prudential and each holder of Notes outstanding under the
Existing Agreement agree that the Existing Agreement is amended
and restated in its entirety to read as provided in this
Agreement.
1.2. Authorization of Issue of Notes. The Company will authorize
the issue of its senior promissory notes (the "Notes") in the
aggregate principal amount of $450,000,000 to be dated the date
of issue thereof; to mature, in the case of each Note so issued,
no more than 12 years after the date of original issuance
thereof; to have an average life, in the case of each note so
issued, of no more than 10 years after the date of original
issuance thereof; to bear interest on the unpaid balance thereof
from the date thereof at the rate per annum, and to have such
other particular terms, as shall be set forth, in the case of
each Note so issued, in the Confirmation of Acceptance with
respect to such Note delivered pursuant to Section 2.6; and to be
substantially in the form of Exhibit 1 attached hereto. The term
"Notes" as used herein shall include each Note delivered pursuant
to any provision of this Agreement and each Note delivered in
substitution or exchange for any such Note pursuant to any such
provision. Notes which have (i) the same final maturity, (ii)
the same installment payment dates, (iii) the same installment
payment amounts (as a percentage of the original principal amount
of each Note), (iv) the same interest rate, (v) the same interest
payment periods, and (vi) the same original date of issuance are
herein called a "Series" of Notes. Certain capitalized terms
used in this Agreement are defined in Schedule B; references to a
"Schedule" or an "Exhibit" are, unless otherwise specified, to a
Schedule or an Exhibit attached to this Agreement.
2. SALE AND PURCHASE OF NOTES.
2.1. Facility; Limitation on Facility.
(a) Facility. Prudential is willing to consider, in
its sole discretion and within limits which may be authorized for
purchase by Prudential Affiliates from time to time, the purchase
of $450,000,000 of the total amount of authorized Notes pursuant
to this Agreement. The willingness of Prudential to consider
such purchase of Notes is herein called the "Facility." At any
time, subject to the additional limitations in Section 2.1(b),
the aggregate principal amount of Notes stated in Section 1.2,
minus the aggregate principal amount of Notes purchased and sold
pursuant to this Agreement prior to such time, minus the
aggregate principal amount of Accepted Notes which have not yet
been purchased and sold hereunder prior to such time, plus the
aggregate principal amount of Notes purchased and sold pursuant
to this Agreement and thereafter retired prior to such time (to
the extent that the Company shall have agreed with Prudential to
reinstate the Facility with respect to such amount) is herein
called the "Available Facility Amount" at such time.
NOTWITHSTANDING THE WILLINGNESS OF PRUDENTIAL TO CONSIDER
PURCHASES OF NOTES, THIS AGREEMENT IS ENTERED INTO ON THE EXPRESS
UNDERSTANDING THAT NEITHER PRUDENTIAL NOR ANY PRUDENTIAL
AFFILIATE SHALL BE OBLIGATED TO MAKE OR ACCEPT OFFERS TO PURCHASE
NOTES, OR TO QUOTE RATES, SPREADS OR OTHER TERMS WITH RESPECT TO
SPECIFIC PURCHASES OF NOTES, AND THE FACILITY SHALL IN NO WAY BE
CONSTRUED AS A COMMITMENT BY PRUDENTIAL OR ANY PRUDENTIAL
AFFILIATE.
(b) Limitation on Facility. Notwithstanding anything
in Section 2.1(a), the Company may not request the issuance of
Notes, and neither Prudential nor any Prudential Affiliate shall
be required to purchase Notes, pursuant to the Facility if, after
the issuance of such Notes, the aggregate amount of Centennial
Exposure would exceed $325,000,000.
2.2. Issuance Period.
Notes may be issued and sold pursuant to this Agreement
until the earlier of (i) April 29, 2008 (or if any such
anniversary is not a Business Day, the Business Day next
preceding such anniversary) and (ii) the thirtieth day after
Prudential shall have given to the Company, or the Company shall
have given to Prudential, a notice stating that it elects to
terminate the issuance and sale of Notes pursuant to this
Agreement (or if such thirtieth day is not a Business Day, the
Business Day next preceding such thirtieth day). The period
during which Notes may be issued and sold pursuant to this
Agreement is herein called the "Issuance Period".
2.3. Periodic Spread Information.
Provided no Default or Event of Default exists, not
later than 9:30 A.M. (New York City local time) on a Business Day
during the Issuance Period if there is an Available Facility
Amount on such Business Day, the Company may request by
telecopier or telephone, and Prudential will, to the extent
reasonably practicable, provide to the Company on such Business
Day (or, if such request is received after 9:30 A.M. (New York
City local time) on such Business Day, on the following Business
Day), information (by telecopier or telephone) with respect to
various spreads at which Prudential Affiliates might be
interested in purchasing Notes of different average lives;
provided, however, that the Company may not make such requests
more frequently than once in every five Business Days or such
other period as shall be mutually agreed to by the Company and
Prudential. The amount and content of information so provided
shall be in the sole discretion of Prudential but it is the
intent of Prudential to provide information which will be of use
to the Company in determining whether to initiate procedures for
use of the Facility. Information so provided shall not
constitute an offer to purchase Notes, and neither Prudential nor
any Prudential Affiliate shall be obligated to purchase Notes at
the spreads specified. Information so provided shall be
representative of potential interest only for the period
commencing on the day such information is provided and ending on
the earlier of the fifth Business Day after such day and the
first day after such day on which further spread information is
provided. Prudential may suspend or terminate providing
information pursuant to this Section 2.3 if, in its sole
discretion, it determines that there has been an adverse change
in the credit quality of the Company after the Effective Date.
2.4. Request for Purchase.
The Company may from time to time during the Issuance
Period make requests for purchases of Notes (each such request
being a "Request for Purchase"). Each Request for Purchase shall
be made to Prudential by telecopier and confirmed by nationwide
overnight delivery service, shall be on the letterhead of the
Company, and shall (i) specify the aggregate principal amount of
Notes covered thereby, which shall not be less than $5,000,000
and not be greater than the Available Facility Amount (and shall
be subject to the limitations of Section 2.1(b)) at the time such
Request for Purchase is made if the request is made, (ii) specify
the principal amounts, final maturities, installment payment
dates and amounts and interest payment periods (quarterly or semi-
annual in arrears) of the Notes covered thereby, (iii) specify
the use of proceeds of such Notes, (iv) specify the proposed day
for the closing of the purchase and sale of such Notes, which
shall be a Business Day during the Issuance Period not less than
10 days and not more than 20 days after the making of such
Request for Purchase, (v) specify the number of the account and
the name and address of the depository institution to which the
purchase prices of such Notes are to be transferred on the
Closing Day for such purchase and sale, (vi) certify that the
representations and warranties contained in Section 5 (as they
may have been amended pursuant to this Section 2.4) are true on
and as of the date of such Request for Purchase except to the
extent of changes caused by the transactions herein contemplated
and that there exists on the date of such Request for Purchase no
Event of Default or Default, and (vii) be substantially in the
form of Exhibit 2.4 attached hereto. Each Request for Purchase
shall be in writing and shall be deemed made when received by
Prudential. Any previous notification referenced in a Request
for Purchase or any Request for Purchase that contains
information that purports to amend the information contained in
any Schedule or Exhibit hereto, shall not be effective to amend
such information unless it is received by Prudential at least
five Business Days prior to the Acceptance Day for Notes to which
such Request for Purchase relates. If Prudential provides such
interest rates quotes earlier than five Business Days after
Prudential receives a Request for Purchase which contains
information that purports to amend the information contained in
any Schedule or Exhibit hereto and Prudential states in writing
that it waives the requirement in this Section 2.4 that the
information shall not be effective to amend unless it is received
by Prudential at least five Business Days prior to the Acceptance
Day, the information contained in such Schedule or Exhibit shall
be deemed effective to amend such information at the time of the
issuance of the quotes.
2.5. Rate Quotes.
Not later than six Business Days after the Company
shall have given Prudential a Request for Purchase pursuant to
Section 2.4, Prudential may provide (by telephone promptly
thereafter confirmed by telecopier, in each case no earlier than
9:30 A.M. and no later than 1:30 P.M. New York City local time)
interest rate quotes for the several principal amounts,
maturities, installment payment schedules, and interest payment
periods of Notes specified in such Request for Purchase. Each
quote shall represent the interest rate per annum payable on the
outstanding principal balance of such Notes until such balance
shall have become due and payable, at which a Prudential
Affiliate would be willing to purchase such Notes at 100% of the
principal amount thereof.
2.6. Acceptance.
Within 30 minutes after Prudential shall have provided
any interest rate quotes pursuant to Section 2.5 or, in the event
that due to conditions in the market place it shall not be
feasible to hold such interest rate quotes open 30 minutes, such
shorter period as Prudential may specify to the Company (such
period being the "Acceptance Window"), the Company may, subject
to Section 2.7, elect to accept such interest rate quotes as to
not less than $5,000,000 aggregate principal amount of the Notes
specified in the related Request for Purchase. Such election
shall be made by an Authorized Officer of the Company notifying
Prudential by telephone or telecopier within the Acceptance
Window (but not earlier than 9:30 A.M. or later than 1:30 P.M.,
New York City local time) that the Company elects to accept such
interest rate quotes, specifying the Notes (each such Note being
an "Accepted Note") as to which such acceptance (an "Acceptance")
relates. The day the Company notifies an Acceptance with respect
to any Accepted Notes is herein called the "Acceptance Day" for
such Accepted Notes. Any interest rate quotes as to which
Prudential does not receive an Acceptance within the Acceptance
Window shall expire, and no purchase or sale of Notes hereunder
shall be made based on such expired interest rate quotes.
Subject to Section 2.7 and the other terms and conditions hereof,
the Company agrees to sell to a Prudential Affiliate, and
Prudential agrees to cause the purchase by a Prudential Affiliate
of, the Accepted Notes at 100% of the principal amount of such
Notes. As soon as practicable following the Acceptance Day, the
Company, Prudential and each Prudential Affiliate which is to
purchase any such Accepted Notes will execute a confirmation of
such Acceptance substantially in the form of Exhibit 2.6 attached
hereto (a "Confirmation of Acceptance").
2.7. Market Disruption.
Notwithstanding the provisions of Section 2.6, if
Prudential shall have provided interest rate quotes pursuant to
Section 2.5 and thereafter prior to the time an Acceptance with
respect to such quotes shall have been notified to Prudential in
accordance with Section 2.6 there shall occur a general
suspension, material limitation, or significant disruption of
trading in securities generally on the New York Stock Exchange or
in the market for U.S. Treasury securities and other financial
instruments, then such interest rate quotes shall expire, and no
purchase or sale of Notes hereunder shall be made based on such
expired interest rate quotes. If the Company thereafter notifies
Prudential of the Acceptance of any such interest rate quotes,
such Acceptance shall be ineffective for all purposes of this
Agreement, and Prudential shall promptly notify the Company that
the provisions of this Section 2.7 are applicable with respect to
such Acceptance.
2.8. Fees.
(a) Facility Fee. The Company will pay to each
Purchaser in immediately available funds a fee (the "Facility
Fee") on each Closing Day on or after January 30, 2000, in an
amount equal to 0.125% of the aggregate principal amount of Notes
sold to such Purchaser on such Closing Day.
(b) Delayed Delivery Fee. If the closing of the
purchase and sale of any Accepted Note is delayed for any reason
(other than in the case where all conditions in Section 4 (other
than Section 4.5 and Section 4.7) have been satisfied and a
Purchaser fails to purchase its Accepted Notes) beyond the
original Closing Day for such Accepted Note, the Company will pay
to Prudential on the Cancellation Date or actual closing date of
such purchase and sale (if such Cancellation Date or closing date
occurs on a date later than the date specified in the
Confirmation of Acceptance for such Accepted Note), a fee (the
"Delayed Delivery Fee") calculated as follows:
(BEY - MMY) X DTS/360 X PA
where "BEY" means Bond Equivalent Yield, i.e., the bond
equivalent yield per annum of such Accepted Note, "MMY" means
Money Market Yield, i.e., the yield per annum on an alternative
investment selected by Prudential on the date Prudential receives
notice of the delay in the closing for such Accepted Notes having
a maturity date or dates the same as, or closest to, the
Rescheduled Closing Day or Rescheduled Closing Days (a new
alternative investment being selected by Prudential each time
such closing is delayed); "DTS" means Days to Settlement, i.e.,
the number of actual days elapsed from and including the
originally scheduled Closing Day with respect to such Accepted
Note (in the case of the first such payment with respect to such
Accepted Note) or from and including the date of the next
preceding payment (in the case of any subsequent delayed delivery
fee payment with respect to such Accepted Note) to but excluding
the date of such payment; and "PA" means Principal Amount, i.e.,
the principal amount of the Accepted Note for which such
calculation is being made. In no case shall the Delayed Delivery
Fee be less than zero. Nothing contained herein shall obligate
any Purchaser to purchase any Accepted Note on any day other than
the Closing Day for such Accepted Note, as the same may be
rescheduled from time to time in compliance with Section 3.2.
(c) Cancellation Fee. If the Company at any time
notifies Prudential in writing that the Company is canceling the
closing of the purchase and sale of any Accepted Note, or if
Prudential notifies the Company in writing under the
circumstances set forth in the last sentence of Section 3.2 that
the closing of the purchase and sale of such Accepted Note is to
be canceled, or if the closing of the purchase and sale of such
Accepted Note is not consummated on or prior to the last day of
the Issuance Period (the date of any such notification, or the
last day of the Issuance Period, as the case may be, being the
"Cancellation Date"), the Company will pay Prudential in
immediately available funds an amount (the "Cancellation Fee")
calculated as follows:
PI X PA
where "PI" means Price Increase, i.e., the quotient (expressed in
decimals) obtained by dividing (a) the excess of the ask price
(as determined by Prudential) of the Hedge Treasury Note(s) on
the Cancellation Date over the bid price (as determined by
Prudential) of the Hedge Treasury Notes(s) on the Acceptance Day
for such Accepted Note by (b) such bid price; and "PA" has the
meaning specified in Section 2.8(b). The foregoing bid and ask
prices shall be as reported by Telerate Systems, Inc. (or, if
such data for any reason ceases to be available through Telerate
Systems, Inc., any publicly available source of similar market
data). Each price shall be based on a U.S. Treasury security
having a par value of $100.00 and shall be rounded to the second
decimal place. In no case shall the Cancellation Fee be less
than zero.
(d) Structuring Fee. The Company paid PICA a fee of
$75,000 at the time of the execution and delivery of the Original
Agreement. The Company will pay to Prudential in immediately
available funds a fee (the "Structuring Fee") on October 28, 2005
in an amount equal to $50,000 unless after the Effective Date and
(I) on or before October 28, 2005 the Company issues at least
$50,000,000 of Notes or (II) on or before July 29, 2005 the
Company issues at least $25,000,000 of Notes.
3. CLOSING.
3.1. Closings.
Not later than 11:30 A.M. (New York City local time) on
the Closing Day for any Accepted Notes, the Company will deliver
to each Purchaser listed in the Confirmation of Acceptance
relating thereto at the offices of Prudential Capital Group, ▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇ the Accepted Notes
to be purchased by such Purchaser in the form of one or more
Notes in authorized denominations as such Purchaser may request
for each Series of Accepted Notes to be purchased on the Closing
Day, dated the Closing Day and registered in such Purchaser's
name (or in the name of its nominee), against payment of the
purchase price thereof by transfer of immediately available funds
for credit to the Company's account specified in the Request for
Purchase of such Notes.
3.2. Rescheduled Closings.
If the Company fails to tender to any Purchaser the
Accepted Notes to be purchased by such Purchaser on the scheduled
Closing Day for such Accepted Notes as provided in Section 3.1,
or any of the conditions specified in Section 4 shall not have
been fulfilled by the time required on such scheduled Closing
Day, the Company shall, prior to 1:00 P.M., New York City local
time, on such scheduled Closing Day notify such Purchaser in
writing whether (i) such closing is to be rescheduled (such
rescheduled date to be a Business Day during the Issuance Period
not less than one Business Day and not more than 30 Business Days
after such scheduled Closing Day (the "Rescheduled Closing Day")
and certify to such Purchaser that the Company reasonably
believes that it will be able to comply with the conditions set
forth in Section 4 on such Rescheduled Closing Day and that the
Company will pay the Delayed Delivery Fee in accordance with
Section 2.8(b) or (ii) such closing is to be canceled as provided
in Section 2.8(c). In the event that the Company shall fail to
give such notice referred to in the preceding sentence, such
Purchaser may at its election, at any time after 1:00 P.M., New
York City local time, on such scheduled Closing Day, notify the
Company in writing that such closing is to be canceled as
provided in Section 2.8(c).
4. CONDITIONS TO CLOSING.
The obligation of any Purchaser to purchase and pay for
any Accepted Notes is subject to the fulfillment to such
Purchaser's satisfaction, prior to or at the Closing Day for such
Accepted Notes, of the following conditions:
4.1. Representations and Warranties.
The representations and warranties of the Company in
this Agreement shall be correct when made and at such Closing
Day.
4.2. Performance; No Default.
The Company shall have performed and complied with all
agreements and conditions contained in this Agreement required to
be performed or complied with by it prior to or at such Closing
Day and after giving effect to the issue and sale of such
Accepted Notes (and the application of the proceeds thereof as
contemplated by the Request for Purchase for such Accepted Notes)
no Default or Event of Default shall have occurred and be
continuing. Neither the Company nor any Subsidiary shall have
entered into any transaction from December 31, 2004 to the
Effective Date, that would have been prohibited by Sections 10.1
through 10.12, hereof had such Sections applied since such date.
4.3. Compliance Certificates.
(a) Officer's Certificate. The Company shall have
delivered to such Purchaser an Officer's Certificate, dated the
date of such Closing Day, certifying that the conditions
specified in Sections 4.1, 4.2 and 4.8 have been fulfilled.
(b) Secretary's Certificate. The Company shall have
delivered to such Purchaser a certificate, dated as of such
Closing Day, certifying as to the resolutions attached thereto
and other corporate proceedings relating to the authorization,
execution and delivery of such Accepted Notes and this Agreement.
4.4. Opinions of Counsel.
Such Purchaser shall have received opinions in form and
substance reasonably satisfactory to such Purchaser, dated the
date of such Closing Day from ▇▇▇▇▇▇ ▇▇▇▇ & Priest LLP, counsel
for the Company, and ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, General Counsel of the
Company, or ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Associate General Counsel of the
Company covering the matters set forth in Exhibits 4.4(a) and
4.4(b), respectively, and covering such other matters incident to
the transactions contemplated hereby as such Purchaser or its
counsel may reasonably request. The Company hereby directs each
such counsel to deliver such opinion and agrees that the issuance
and sale of any Accepted Notes will constitute a renewal of such
direction. The Company has advised such counsel that each
Purchaser receiving such an opinion will rely on such opinion, as
of the date of such opinion.
4.5. Purchase Permitted By Applicable Law, etc.
On such Closing Day the purchase of Notes by such
Purchaser shall (i) be permitted by the laws and regulations of
each jurisdiction to which it is subject, without recourse to
provisions (such as Section 1405(a)(8) of the New York Insurance
Law) permitting limited investments by insurance companies
without restriction as to the character of the particular
investment, (ii) not violate any applicable law or regulation
(including, without limitation, Regulation T, U or X of the Board
of Governors of the Federal Reserve System) and (iii) not subject
such Purchaser to any tax, penalty or liability under or pursuant
to any applicable law or regulation, which law or regulation was
not in effect on the date hereof. If requested, such Purchaser
shall have received an Officer's Certificate certifying as to
such matters of fact as it may reasonably specify to enable such
Purchaser to determine whether such purchase is so permitted.
4.6. Payment of Facility Fee and Structuring Fee.
The Company shall have paid on or before such Closing
Day the Facility Fee required by Section 2.8(a) for such Accepted
Notes and the Structuring Fee, if required by Section 2.8(d).
4.7. Private Placement Number.
A Private Placement Number issued by Standard & Poor's
CUSIP Service Bureau (in cooperation with the Securities
Valuation Office of the National Association of Insurance
Commissioners) shall have been obtained by the Purchasers for
such Accepted Notes.
4.8. Changes in Corporate Structure.
The Company shall not be in violation of Section 9.5.
4.9. Certain Documents.
Such Purchaser shall have received the following:
(i) The Accepted Note(s) to be purchased by such
Purchaser on such Closing Day.
(ii) Certified copies of the Certificate of
Incorporation and By-laws of the Company as of such Closing Day,
or a certificate of the Secretary or an Assistant Secretary of
the Company certifying that there have been no changes to the
Certificate of Incorporation and By-laws of the Company since the
same were previously delivered pursuant to this Agreement.
(iii) A good standing certificate for the Company
from the Secretary of State of Delaware dated of a recent date
prior to such Closing Day and such other evidence of the status
of the Company as such Purchaser may reasonably request.
4.10. Proceedings and Documents.
All of the Company's corporate and other proceedings
required in connection with the transactions contemplated by this
Agreement and all documents and instruments incident to such
transactions shall be reasonably satisfactory to Prudential and
its counsel, and Prudential and its counsel shall have received
all such counterpart originals or certified or other copies of
such documents as Prudential or they may reasonably request.
5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
The Company represents and warrants to each Purchaser that:
5.1. Organization; Power and Authority.
The Company is a corporation duly organized, validly
existing and in good standing under the laws of its jurisdiction
of incorporation, and is duly qualified as a foreign corporation
and is in good standing in each jurisdiction in which such
qualification is required by law, other than those jurisdictions
as to which the failure to be so qualified or in good standing
could not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect. The Company has the
corporate power and authority to own or hold under lease the
properties it purports to own or hold under lease, to transact
the business it transacts and proposes to transact, to execute
and deliver this Agreement and the Notes and to perform the
provisions hereof and thereof.
5.2. Authorization, etc.
This Agreement and the Notes have been duly authorized
by all necessary corporate action on the part of the Company, and
this Agreement constitutes, and upon execution and delivery
thereof each Note will constitute, a legal, valid and binding
obligation of the Company enforceable against the Company in
accordance with its terms, except as such enforceability may be
limited by (i) applicable bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting the enforcement of
creditors' rights generally and (ii) general principles of equity
(regardless of whether such enforceability is considered in a
proceeding in equity or at law).
5.3. Disclosure.
The Company has delivered to Prudential a copy of the
MDU Annual Report. The information with respect to the Company
contained in the MDU Annual Report fairly describes, in all
material respects, the general nature of the business and
principal properties of the Company and its Subsidiaries as of
the Effective Date. This Agreement, the MDU Annual Report (as the
same may be updated pursuant to an Officer's Certificate
certifying that the information contained therein is an update of
information pertaining to the general nature of the business and
principal properties of the Company and its Subsidiaries
contained in the MDU Annual Report and delivered pursuant to this
Section 5.3 and Section 2.4) and the financial statements
referred to in Section 5.5, taken as a whole, do not contain any
untrue statement of a material fact or omit to state any material
fact necessary to make the statements therein not misleading in
light of the circumstances under which they were made. Except as
expressly described in the MDU Annual Report (as updated as
provided in this Section 5.3), or in the financial statements
referred to in Section 5.5, since December 31, 2004 (with respect
to information pertaining to the general nature of the business
and principal properties of the Company and its Subsidiaries
contained in the MDU Annual Report (as updated) other than
financial statements) and, since the end of the most recent
fiscal year for which audited financial statements have been
furnished (with respect to financial statements), there has been
no change in the financial condition, operations, business or
properties of the Company or any Subsidiary except changes that
individually or in the aggregate would not reasonably be expected
to have a Material Adverse Effect. There is no fact known to the
Company that would reasonably be expected to have a Material
Adverse Effect that has not been set forth herein or in the MDU
Annual Report (as updated or amended from time to time pursuant
to Section 2.4) or in the financial statements referred to in
Section 5.5.
5.4. Organization and Ownership of Shares of Subsidiaries;
Affiliates.
(a) Schedule 5.4, as it may be amended from time to
time pursuant to Section 2.4, contains (except as noted therein)
complete and correct lists (i) of the Company's Subsidiaries,
showing, as to each Subsidiary, the correct name thereof, the
jurisdiction of its organization, the percentage of shares of
each class of its capital stock or similar equity interests
outstanding owned by the Company and each other Subsidiary and
designating each Subsidiary as a Restricted or Unrestricted
Subsidiary, (ii) of the Company's Affiliates, other than
Subsidiaries, and (iii) of the Company's directors and senior
officers.
(b) All of the outstanding shares of capital stock of
each Subsidiary shown in Schedule 5.4, as it may be amended from
time to time pursuant to Section 2.4, as being owned by the
Company and its Subsidiaries have been validly issued, are fully
paid and nonassessable and are owned by the Company or another
Subsidiary free and clear of any Lien (except as permitted by
Section 10.4).
(c) Each Subsidiary identified in Schedule 5.4, as it
may be amended from time to time pursuant to Section 2.4, is a
corporation or other legal entity duly organized, validly
existing and in good standing under the laws of its jurisdiction
of organization, and is duly qualified as a foreign corporation
or other legal entity and is in good standing in each
jurisdiction in which such qualification is required by law,
other than those jurisdictions as to which the failure to be so
qualified or in good standing could not, individually or in the
aggregate, reasonably be expected to have a Material Adverse
Effect. Each such Subsidiary has the corporate or other power
and authority to own or hold under lease the properties it
purports to own or hold under lease and to transact the business
it transacts and proposes to transact.
(d) No Restricted Subsidiary is a party to, or
otherwise subject to any legal restriction or any agreement
(other than the agreements listed on Schedule 5.4, as it may be
amended from time to time, pursuant to Section 2.4, and customary
limitations imposed by Requirements of Law) restricting the
ability of such Subsidiary to pay dividends out of profits or
make any other similar distributions of profits to the Company or
any of its Subsidiaries that owns outstanding shares of capital
stock or similar equity interests of such Subsidiary.
5.5. Financial Statements.
The Company has delivered to each Purchaser of Accepted
Notes copies of the following financial statements (i) a
consolidated balance sheet of the Company and its Subsidiaries as
at December 31 in each of the two fiscal years of the Company
most recently completed prior to the date as of which this
representation is made or repeated to such Purchaser (other than
fiscal years completed within 120 days prior to such date for
which audited financial statements have not been released) and
consolidated statements of income, stockholders' equity and cash
flows of the Company and its Subsidiaries for each such year, all
reported on by the Company's independent auditors (which shall be
Deloitte & Touche or another nationally recognized independent
accounting firm); and (ii) an unaudited consolidated balance
sheet of the Company and its Subsidiaries as at the end of the
quarterly period (if any) most recently completed prior to such
date and after the end of such fiscal year (other than quarterly
periods completed within 60 days prior to such date for which
financial statements have not been released) and the comparable
quarterly period in the preceding fiscal year and unaudited
consolidated statements of income, stockholders' equity and cash
flows for the periods from the beginning of the fiscal years in
which such quarterly periods are included to the end of such
quarterly periods, prepared by the Company. All of said
financial statements (including in each case the related
schedules and notes) fairly present in all material respects the
consolidated financial position of the Company and its
Subsidiaries as of the respective dates specified in such
financial statements and the consolidated results of their
operations and cash flows for the respective periods so specified
and have been prepared in accordance with GAAP consistently
applied throughout the periods involved except as set forth in
the notes thereto (subject, in the case of any interim financial
statements, to normal year-end adjustments).
5.6. Compliance with Laws, Other Instruments, etc.
The execution, delivery and performance by the Company
of this Agreement and the Notes will not (i) contravene, result
in any breach of, or constitute a default under, or result in the
creation of any Lien in respect of any property of the Company or
any Subsidiary under, any indenture, mortgage, deed of trust,
loan, purchase or credit agreement, lease, corporate charter or
by-laws, or any other agreement or instrument to which the
Company or any Subsidiary is bound or by which the Company or any
Subsidiary or any of their respective properties may be bound or
affected, (ii) conflict with or result in a breach of any of the
terms, conditions or provisions of any order, judgment, decree,
or ruling of any court, arbitrator or Governmental Authority
applicable to the Company or any Subsidiary or (iii) violate any
provision of any statute or other rule or regulation of any
Governmental Authority applicable to the Company or any
Subsidiary.
5.7. Governmental Authorizations, etc.
No consent, approval or authorization of, or
registration, filing or declaration with, any Governmental
Authority is required in connection with the execution, delivery
or performance by the Company of this Agreement or the Notes.
5.8. Litigation; Observance of Agreements, Statutes and Orders.
(a) Except as disclosed in Schedule 5.8, as it may be
amended from time to time pursuant to Section 2.4, there are no
actions, suits or proceedings pending or, to the knowledge of the
Company, threatened against the Company or any Subsidiary or any
property of the Company or any Subsidiary in any court or before
any arbitrator of any kind or before or by any Governmental
Authority that, individually or in the aggregate, could
reasonably be expected to have a Material Adverse Effect.
(b) Neither the Company nor any Subsidiary is in
default under any term of any agreement or instrument to which it
is a party or by which it is bound, or any order, judgment,
decree or ruling of any court, arbitrator or Governmental
Authority or is in violation of any applicable law, ordinance,
rule or regulation (including without limitation Environmental
Laws) of any Governmental Authority, which default or violation,
individually or in the aggregate, could reasonably be expected to
have a Material Adverse Effect.
5.9. Taxes.
The Company and its Subsidiaries have filed all tax
returns that are required to have been filed in any jurisdiction,
and have paid all taxes shown to be due and payable on such
returns and all other taxes and assessments levied upon them or
their properties, assets, income or franchises, to the extent
such taxes and assessments have become due and payable and before
they have become delinquent, except for any taxes and assessments
(i) the amount of which is not individually or in the aggregate
Material or (ii) the amount, applicability or validity of which
is currently being contested in good faith by appropriate
proceedings and with respect to which the Company or a
Subsidiary, as the case may be, has established adequate reserves
in accordance with GAAP. As of the Effective Date, (x) the
Company knows of no basis for any other tax or assessment that
could reasonably be expected to have a Material Adverse Effect;
(y) the charges, accruals and reserves on the books of the
Company and its Subsidiaries in respect of Federal, state or
other taxes for all fiscal periods are adequate; and (z) the
Federal income tax liabilities of the Company and its
Subsidiaries have been determined by the Internal Revenue Service
and accrued for all fiscal years up to and including the fiscal
year ended December 31, 2000.
5.10. Title to Property; Leases.
The Company and its Restricted Subsidiaries have good
and sufficient title to their respective properties that
individually or in the aggregate are Material, including all such
properties reflected in the most recent audited balance sheet
referred to in Section 5.5 or purported to have been acquired by
the Company or any Restricted Subsidiary after said date (except
as sold or otherwise disposed of in the ordinary course of
business or listed on Schedule 5.10, as it may be amended from
time to time pursuant to Section 2.4), in each case free and
clear of Liens prohibited by this Agreement. All leases that
individually or in the aggregate are Material are valid and
subsisting and are in full force and effect in all material
respects.
5.11. Licenses, Permits, etc.
(a) The Company and its Subsidiaries own or possess
all licenses, permits, franchises, authorizations, patents,
copyrights, service marks, trademarks and trade names, or rights
thereto, that individually or in the aggregate are Material to
the operation of the business of the Company and its Restricted
Subsidiaries, taken as a whole, without known conflict with the
rights of others.
(b) To the best knowledge of the Company, no product
of the Company infringes in any material respect any license,
permit, franchise, authorization, patent, copyright, service
▇▇▇▇, trademark, trade name or other right owned by any other
Person.
(c) To the best knowledge of the Company, there is no
Material violation by any Person of any right of the Company or
any of its Subsidiaries with respect to any patent, copyright,
service ▇▇▇▇, trademark, trade name or other right owned or used
by the Company or any of its Subsidiaries.
5.12. Compliance with ERISA.
(a) Each Plan is in compliance in all material respects with
ERISA, the Code and other applicable federal or state law. Each
Plan which is intended to quality under Section 401 (a) of the
Code has received a favorable determination letter from IRS and,
to the best knowledge of the Company, nothing has occurred which
would or could reasonably be expected to cause the loss of such
qualification of any such Plan or related trust.
(b) There are no pending or, to the best knowledge of the
Company, threatened claims (other than routine claims for
benefits in the ordinary course), actions or lawsuits, or action
by any Governmental Authority, with respect to any Plan which has
resulted or could reasonably be expected to result in a Material
Adverse Effect. To the best knowledge of the Company, there has
been no prohibited transaction within the meaning of Section 4975
of the Code or Section 406 of ERISA or other material violation
of the fiduciary responsibility rules with respect to any Plan
which has resulted or could reasonably be expected to result in a
Material Adverse Effect.
(c) No Reportable Event has occurred or is reasonably expected
to occur with respect to any Pension Plan or Multiemployer Plan.
(d) The aggregate Unfunded Pension Liability for all Pension
Plans (calculated based on the most recent actuarial report for
each Pension Plan) does not exceed $15,000,000.
(e) Neither the Company nor any ERISA Affiliate has incurred nor
does it reasonably expect to incur, any liability under Title IV
or ERISA with respect to any Pension Plan (other than premiums
due and not delinquent under Section 4007 of ERISA).
(f) Neither the Company nor any ERISA Affiliate has transferred
any Unfunded Pension Liability to any Person or otherwise engaged
in a transaction that could be subject to Section 4069 of ERISA.
(g) Neither the Company nor any ERISA Affiliate has incurred nor
reasonably expects to incur, any liability (and no event has
occurred which, with the giving of notice under Section 4219 of
ERISA, would result in such liability) under Section 4201 or 4243
of ERISA with respect to a Multiemployer Plan.
(h) The execution and delivery of this Agreement and the
issuance and sale of the Notes will be exempt from, or will not
involve any transaction which is subject to, the prohibitions of
Section 406(a) of ERISA and will not involve any transaction in
connection with which a penalty could be imposed under Section
502(i) of ERISA or a tax could be imposed pursuant to
Section 4975(c)(i)(A)-(D) of the Code. The representation by the
Company in the next preceding sentence is made in reliance upon
and subject to the accuracy of the representation of each
Purchaser in Section 6.2 as to the source of funds to be used by
it to purchase any Notes.
5.13. Private Offering by the Company.
Neither the Company nor anyone acting on its behalf has
offered the Notes or any similar securities for sale to, or
solicited any offer to buy any of the same from, or otherwise
approached or negotiated in respect thereof with, any person
other than the Purchasers and other Institutional Investors, each
of which has been offered the Notes at a private sale for
investment. Neither the Company nor anyone acting on its behalf
has taken, or will take, any action that would subject the
issuance or sale of the Notes to the registration requirements of
Section 5 of the Securities Act.
5.14. Use of Proceeds; Margin Regulations.
The Company will apply the proceeds of the sale of the
Notes of any Series as set forth in the Request for Purchase for
such Notes. No part of the proceeds from the sale of the Notes
hereunder will be used, directly or indirectly, for the purpose
of buying or carrying any margin stock within the meaning of
Regulation U of the Board of Governors of the Federal Reserve
System (12 CFR 221), or for the purpose of buying or carrying or
trading in any securities under such circumstances as to involve
the Company in a violation of Regulation X of said Board (12 CFR
224) or to involve any broker or dealer in a violation of
Regulation T of said Board (12 CFR 220). Margin stock does not
constitute more than 2% of the value of the consolidated assets
of the Company and its Subsidiaries and the Company does not have
any present intention that margin stock will constitute more than
5% of the value of such assets. As used in this Section, the
terms "margin stock" and "purpose of buying or carrying" shall
have the meanings assigned to them in said Regulation U.
5.15. Existing Indebtedness; Future Liens.
(a) Schedule 5.15 sets forth a complete and correct
list of all outstanding Indebtedness of the Company and its
Restricted Subsidiaries as of December 31, 2004. Neither the
Company nor any of its Restricted Subsidiaries has any
outstanding Indebtedness except as permitted by Section 10.1,
10.2, 10.3 and 10.5. Neither the Company nor any Restricted
Subsidiary is in default and no waiver of default is currently in
effect, in the payment of any principal or interest on any
Indebtedness of the Company or such Restricted Subsidiary and no
event or condition exists with respect to any Indebtedness of the
Company or any Restricted Subsidiary that would permit (or that
with notice or the lapse of time, or both, would permit) one or
more Persons to cause such Indebtedness to become due and payable
before its stated maturity or before its regularly scheduled
dates of payment.
(b) As of the Effective Date, neither the Company nor
any Restricted Subsidiary has any Indebtedness secured by a Lien
on any of their respective property. Neither the Company nor any
Restricted Subsidiary has agreed or consented to cause or permit
in the future (upon the happening of a contingency or otherwise)
any of its property, whether now owned or hereafter acquired, to
be subject to a Lien securing Indebtedness, in violation of
Section 10.4.
5.16. Status under Certain Statutes.
Neither the Company nor any Subsidiary or Affiliate is
subject to regulation under the Investment Company Act of 1940,
as amended. The Company is not subject to regulation under the
Public Utility Holding Company Act of 1935, as amended, the
Interstate Commerce Act, as amended, the Federal Power Act, as
amended, any state public utilities code or statute, or any other
Federal or state statute or regulation limiting its ability to
incur indebtedness.
5.17. Environmental Matters.
Except as described in Schedule 5.17, as it may be
amended from time to time pursuant to Section 2.4, the Company
and its Subsidiaries and all of their respective properties and
facilities have complied at all times and in all respects with
all Federal, state, local and regional statutes, laws, ordinances
and judicial or administrative orders, judgments, rulings and
regulations relating to protection of the environment except, in
any such case, where failure to comply would not result in a
Material Adverse Effect.
5.18. Hostile Tender Offers.
None of the proceeds of the sale of any Notes will be
used to finance a Hostile Tender Offer.
5.19. Foreign Assets Control Regulations, Etc.
(a) Neither the sale of the Notes by the Company
hereunder nor its use of the proceeds thereof will violate the
Trading with the Enemy Act, as amended, or any of the foreign
assets control regulations of the United States Treasury
Department (31 CFR, Subtitle B, Chapter V, as amended) or any
enabling legislation or executive order relating thereto.
(b) Neither the Company nor any Subsidiary (i) is a
Person described or designated in the Specially Designated
Nationals and Blocked Persons List of the Office of Foreign
Assets Control or in Section 1 of the Anti-Terrorism Order or
(ii) engages in any dealings or transactions with any such
Person. The Company and its Subsidiaries are in compliance, in
all material respects, with the USA Patriot Act.
(c) No part of the proceeds from the sale of the Notes
hereunder will be used, directly or indirectly, for any payments
to any governmental official or employee, political party,
official of a political party, candidate for political office, or
anyone else acting in an official capacity, in order to obtain,
retain or direct business or obtain any improper advantage, in
violation of the United States Foreign Corrupt Practices Act of
1977, as amended, assuming in all cases that such Act applies to
the Company.
6. REPRESENTATIONS OF THE PURCHASER.
6.1. Purchase for Investment.
Each Purchaser represents that it is purchasing the
Notes for its own account or for one or more separate accounts
maintained by it or for the account of one or more pension or
trust funds and not with a view to the distribution thereof,
provided that the disposition of its or their property shall at
all times be within its or their control. Each Purchaser
understands that the Notes have not been registered under the
Securities Act and may be resold only if registered pursuant to
the provisions of the Securities Act or if an exemption from
registration is available, except under circumstances where
neither such registration nor such an exemption is required by
law, and that the Company is not required to register the Notes.
6.2. Source of Funds.
Each Purchaser represents that at least one of the
following statements is an accurate representation as to each
source of funds (a "Source") to be used by it to pay the purchase
price of the Notes to be purchased by it hereunder:
(a) the Source is an "insurance company general
account" (as the term is defined in the United States
Department of Labor's Prohibited Transaction Exemption
("PTE") 95-60) in respect of which the reserves and
liabilities (as defined by the annual statement for life
insurance companies approved by the National Association of
Insurance Commissioners (the "NAIC Annual Statement")) for
the general account contract(s) held by or on behalf of any
employee benefit plan together with the amount of the
reserves and liabilities for the general account contract(s)
held by or on behalf of any other employee benefit plans
maintained by the same employer (or affiliate thereof as
defined in PTE 95-60) or by the same employee organization
in the general account do not exceed 10% of the total
reserves and liabilities of the general account (exclusive
of separate account liabilities) plus surplus as set forth
in the NAIC Annual Statement filed with such Purchaser's
state of domicile; or
(b) the Source is a separate account that is
maintained solely in connection with such Purchaser's fixed
contractual obligations under which the amounts payable, or
credited, to any employee benefit plan (or its related
trust) that has any interest in such separate account (or to
any participant or beneficiary of such plan (including any
annuitant)) are not affected in any manner by the investment
performance of the separate account; or
(c) the Source is either (i) an insurance company
pooled separate account, within the meaning of PTE 90-1 or
(ii) a bank collective investment fund, within the meaning
of PTE 91-38 and, except as disclosed by such Purchaser to
the Company in writing pursuant to this clause (c), no
employee benefit plan or group of plans maintained by the
same employer or employee organization beneficially owns
more than 10% of all assets allocated to such pooled
separate account or collective investment fund; or
(d) the Source constitutes assets of an "investment
fund" (within the meaning of Part V of PTE 84-14 (the "QPAM
Exemption")) managed by a "qualified professional asset
manager" or "QPAM" (within the meaning of Part V of the QPAM
Exemption), no employee benefit plan's assets that are
included in such investment fund, when combined with the
assets of all other employee benefit plans established or
maintained by the same employer or by an affiliate (within
the meaning of Section V(c)(1) of the QPAM Exemption) of
such employer or by the same employee organization and
managed by such QPAM, exceed 20% of the total client assets
managed by such QPAM, the conditions of Part I(c) and (g) of
the QPAM Exemption are satisfied, neither the QPAM nor a
person controlling or controlled by the QPAM (applying the
definition of "control" in Section V(e) of the QPAM
Exemption) owns a 5% or more interest in the Company and (i)
the identity of such QPAM and (ii) the names of all employee
benefit plans whose assets are included in such investment
fund have been disclosed to the Company in writing pursuant
to this clause (d); or
(e) the Source constitutes assets of a "plan(s)"
(within the meaning of Section IV of PTE 96-23 (the "INHAM
Exemption")) managed by an "in-house asset manager" or
"INHAM" (within the meaning of Part IV of the INHAM
exemption), the conditions of Part I(a), (g) and (h) of the
INHAM Exemption are satisfied, neither the INHAM nor a
person controlling or controlled by the INHAM (applying the
definition of "control" in Section IV(d) of the INHAM
Exemption) owns a 5% or more interest in the Company and (i)
the identity of such INHAM and (ii) the name(s) of the
employee benefit plan(s) whose assets constitute the Source
have been disclosed to the Company in writing pursuant to
this clause (e); or
(f) the Source is a governmental plan; or
(g) the Source is one or more employee benefit plans,
or a separate account or trust fund comprised of one or more
employee benefit plans, each of which has been identified to
the Company in writing pursuant to this clause (g); or
(h) the Source does not include assets of any employee
benefit plan, other than a plan exempt from the coverage of
ERISA.
As used in this Section 6.2, the terms "employee benefit plan",
"governmental plan", "party in interest" and "separate account"
shall have the respective meanings assigned to such terms in
Section 3 of ERISA.
7. INFORMATION AS TO COMPANY.
7.1. Financial and Business Information.
The Company shall deliver to each holder of Notes that
is an Institutional Investor:
(a) Quarterly Statements -- as soon as practicable and
in any event within 60 days after the end of each quarterly fiscal
period in each fiscal year of the Company (other than the last
quarterly fiscal period of each such fiscal year), duplicate
copies of,
(i) unaudited consolidated and consolidating
balance sheets of the Company and its Subsidiaries as
at the end of such quarter, and
(ii) unaudited consolidated and consolidating
statements of income, changes in shareholders' equity
and cash flows of the Company and its Subsidiaries, for
such quarter and (in the case of the second and third
quarters) for the portion of the fiscal year ending
with such quarter,
setting forth in each case in comparative form the figures
for the corresponding periods in the previous fiscal year,
all in reasonable detail, prepared in accordance with GAAP
applicable to quarterly financial statements generally, and
certified by a Senior Financial Officer as fairly
presenting, in all material respects, the financial position
of the companies being reported on and their results of
operations and cash flows, subject to changes resulting from
year-end adjustments, provided that, at such times as the
Company is subject to the reporting requirements of
Section 13 or 15(d) of the Exchange Act, delivery within the
time period specified above of copies of the Company's
Quarterly Report on Form 10-Q prepared in compliance with
the requirements therefor and filed with the SEC shall be
deemed to satisfy the requirements of this Section 7.1(a);
(b) Annual Statements -- as soon as practicable and in
any event within 120 days after the end of each fiscal year
of the Company, duplicate copies of,
(i) consolidated and unaudited consolidating
balance sheet of the Company and its Subsidiaries, as
at the end of such year, and
(ii) consolidated and unaudited consolidating
statements of income, changes in shareholders' equity
and cash flows of the Company and its Subsidiaries, for
such year,
setting forth in each case in comparative form the figures
for the previous fiscal year, all in reasonable detail,
prepared in accordance with GAAP, and, in the case of the
consolidated statements, accompanied
(A) by an opinion thereon of independent
certified public accountants of recognized national
standing, which opinion shall state that such financial
statements present fairly, in all material respects,
the financial position of the companies being reported
upon and their results of operations and cash flows and
have been prepared in conformity with GAAP, and that
the examination of such accountants in connection with
such financial statements has been made in accordance
with generally accepted auditing standards, and that
such audit provides a reasonable basis for such opinion
in the circumstances, and
(B) a certificate of such accountants stating
that, in making the audit necessary for their report on
such financial statements, they have obtained no
knowledge of any Default or any Event of Default, or,
if they have obtained knowledge of any Default or Event
of Default, specifying the nature and period of the
existence thereof (it being understood that such
accountants shall not be liable, directly or
indirectly, for any failure to obtain knowledge of any
Default or Event of Default unless such accountants
should have obtained knowledge thereof in making an
audit in accordance with generally accepted auditing
standards or did not make such an audit);
provided that, at such times as the Company is subject to
the reporting requirements of Section 13 or 15(d) of the
Exchange Act, the delivery within the time period specified
above of the Company's Annual Report on Form 10-K for such
fiscal year (together with the Company's annual report to
shareholders, if any, prepared pursuant to Rule 14a-3 under
the Exchange Act) prepared in accordance with the
requirements therefor and filed with the SEC, together with
the accountant's certificate described in clause (B) above,
shall be deemed to satisfy the requirements of this Section
7.1(b);
(c) Annual Statements of Principal Operating
Subsidiaries -- as soon as available, but not later than 120 days
after the end of each fiscal year, a copy of the audited
consolidated balance sheet of each of the Principal Operating
Subsidiaries and their respective Subsidiaries (and any other
Subsidiary the audited financial statements of which are
delivered to other creditors of the Company, such Subsidiary
being an "Additional Reporting Subsidiary") as at the end of such
year and the related consolidated statements of income or
operations, shareholders' equity and cash flows for such year,
setting forth in each case in comparative form the figures for
the previous fiscal year, and accompanied in each case by the
opinion of independent certified public accountants of recognized
national standing which opinion shall state that such
consolidated financial statements present fairly, in all material
respects, the financial position and the results of operations of
the companies being reported on at the time and for the periods
indicated in conformity with GAAP applied on a basis consistent
with prior years. Such opinions shall not be qualified or
limited because of a restricted or limited examination by such
accountants of any material portion of any of the Principal
Operating Subsidiaries' or any other Subsidiary's or Additional
Reporting Subsidiary's records.
(d) Quarterly Statements of Principal Operating
Subsidiaries -- as soon as available, but not later than 60 days
after the end of each of the first three fiscal quarters of each
fiscal year, a copy of the unaudited consolidated balance sheet
of each of the Principal Operating Subsidiaries and its
Subsidiaries and any Additional Reporting Subsidiary,
respectively, as of the end of such quarter and the related
consolidated statements of income, shareholders' equity and cash
flows for the period commencing on the first day and ending on
the last day of such quarter, certified by a Responsible Officer
as fairly presenting, in all material respects, in accordance
with GAAP (subject to ordinary, good faith year-end audit
adjustments), the financial positions and the results of
operations of each of the companies being reported on at the time
and for the periods indicated;
(e) SEC and Other Reports -- promptly upon their
becoming available, one copy of (i) each financial statement,
report, notice or proxy statement sent by the Company or any
Subsidiary to public securities holders generally, (ii) each
regular or periodic report, each registration statement (without
exhibits except as expressly requested by such holder), and each
final prospectus and all amendments thereto filed by the Company
or any Subsidiary with the SEC, and (iii) copies of all financial
statements and regular, periodical or special reports (including
Forms 10K, 10Q and 8K) that MDU Resources Group, Inc. may make
to, or file with, the SEC;
(f) Reports of Accountants -- promptly upon receipt
thereof, a copy of each other material (in the reasonable
judgment of the Company) report submitted to the Company or any
Subsidiary by independent public accountants in connection with
any annual, interim or special audit made by them of the books
and records of the Company or any Subsidiary;
(g) Notice of Default or Event of Default -- promptly,
and in any event within five days after a Senior Financial
Officer becomes aware of the existence of any Default or Event of
Default, a written notice specifying the nature and period of
existence thereof and what action the Company is taking or
proposes to take with respect thereto;
(h) ERISA Matters -- promptly, and in any event within
five days after a Senior Financial Officer becomes aware of any
of the following, a written notice setting forth the nature
thereof and the action, if any, that the Company or an ERISA
Affiliate proposes to take with respect thereto:
(i) with respect to any Plan, any Reportable
Event; or
(ii) the taking by the PBGC of steps to institute,
or the threatening by the PBGC of the institution of,
proceedings under Section 4042 of ERISA for the
termination of, or the appointment of a trustee to
administer, any Plan, or the receipt by the Company or
any ERISA Affiliate of a notice from a Multiemployer
Plan that such action has been taken by the PBGC with
respect to such Multiemployer Plan; or
(iii) any event, transaction or condition that
could result in the incurrence of any liability by the
Company or any ERISA Affiliate pursuant to Title I or
IV of ERISA or the penalty or excise tax provisions of
the Code relating to employee benefit plans, or in the
imposition of any Lien on any of the rights, properties
or assets of the Company or any ERISA Affiliate
pursuant to Title I or IV of ERISA or such penalty or
excise tax provisions, if such liability or Lien, taken
together with any other such liabilities or Liens then
existing, would reasonably be expected to have a
Material Adverse Effect;
(i) Notices from Governmental Authority -- promptly,
and in any event within 30 days of receipt thereof, copies
of any notice to the Company or any Subsidiary from any
Federal or state Governmental Authority relating to any
order, ruling, statute or other law or regulation that could
reasonably be expected to have a Material Adverse Effect;
(j) Notice of Change in Ratings -- promptly, written
notice of the announcement by any rating agency of any
change or possible change in any component of the Pricing
Rating; and
(k) Requested Information -- with reasonable
promptness, such other data and information relating to the
business, operations, affairs, financial condition, assets
or properties of the Company or any of its Subsidiaries or
relating to the ability of the Company to perform its
obligations hereunder and under the Notes, in any case as
from time to time may be reasonably requested by any such
holder of Notes.
7.2. Officer's Certificate.
Each set of financial statements delivered to a holder
of Notes pursuant to Section 7.1(a) or Section 7.1(b) hereof
shall be accompanied by a certificate of a Senior Financial
Officer setting forth:
(a) Covenant Compliance -- the information (including
detailed calculations) required in order to establish
whether the Company was in compliance with the requirements
of Sections 10.1 through Section 10.3, Section 10.5, Section
10.6 and Section 10.8 hereof, inclusive, during the
quarterly or annual period covered by the statements then
being furnished (including with respect to each such
Section, where applicable, the calculations of the maximum
or minimum amount, ratio or percentage, as the case may be,
permissible under the terms of such Sections, and the
calculation of the amount, ratio or percentage then in
existence); and
(b) Event of Default -- a statement that such officer
has reviewed the relevant terms hereof and has made, or
caused to be made, under his or her supervision, a review of
the transactions and conditions of the Company and its
Subsidiaries from the beginning of the quarterly or annual
period covered by the statements then being furnished to the
date of the certificate and that such review shall not have
disclosed the existence during such period of any condition
or event that constitutes a Default or an Event of Default
or, if any such condition or event existed or exists,
specifying the nature and period of existence thereof and
what action the Company shall have taken or proposes to take
with respect thereto.
7.3. Inspection.
The Company shall permit the representatives of each
holder of Notes that is an Institutional Investor:
(a) No Default -- if no Default or Event of Default
then exists, at the expense of such holder and upon
reasonable prior notice to the Company, to visit the
principal executive office of the Company, to discuss the
affairs, finances and accounts of the Company and its
Restricted Subsidiaries with the Company's officers, and
(with the consent of the Company, which consent will not be
unreasonably withheld) to visit the other offices and
properties of the Company and each Restricted Subsidiary,
all at such reasonable times and as often as may be
reasonably requested in writing; and
(b) Default -- if a Default or Event of Default then
exists, at the expense of the Company to visit and inspect
any of the offices or properties of the Company or any
Subsidiary, to examine all the respective books of account,
records, reports and other papers of the Company and any
Subsidiary, to make copies and extracts therefrom, and to
discuss their respective affairs, finances and accounts with
their respective officers and independent public accountants
(and by this provision the Company authorizes said
accountants to discuss the affairs, finances and accounts of
the Company and its Subsidiaries, so long as a
representative of the Company is offered, on at least two
Business Days' notice, the opportunity to be present), all
at such times and as often as may be requested.
8. PREPAYMENT OF THE NOTES.
8.1. Required Prepayments.
The Notes of each Series shall be subject to the
required prepayments, if any, set forth in the Notes of such
Series.
8.2. Optional Prepayments with Make-Whole Amount.
The Company may, at its option, upon notice as provided
below, prepay at any time all, or from time to time any part of,
the Notes of each Series, in an amount not less than $1,000,000
of the aggregate principal amount of the Notes of such Series
then outstanding in the case of a partial prepayment, at 100% of
the principal amount so prepaid, plus the Make-Whole Amount
determined for the prepayment date with respect to such principal
amount. The Company will give each holder of Notes of each
Series written notice of each optional prepayment under this
Section 8.2 not less than 30 days and not more than 60 days prior
to the date fixed for such prepayment. Each such notice shall
specify such date, the aggregate principal amount of the Notes of
each Series to be prepaid on such date, the principal amount of
each Note of such Series held by such holder to be prepaid
(determined in accordance with Section 8.3), and the interest to
be paid on the prepayment date with respect to such principal
amount being prepaid, and shall be accompanied by a certificate
of a Senior Financial Officer as to the estimated Make-Whole
Amount due in connection with such prepayment (calculated as if
the date of such notice were the date of the prepayment), setting
forth the details of such computation. Two Business Days prior
to such prepayment, the Company shall deliver to each holder of
Notes a certificate of a Senior Financial Officer specifying the
calculation of such Make-Whole Amount as of the specified
prepayment date. Any partial prepayment of a Series of Notes
pursuant to this Section 8.2 shall be applied in satisfaction of
required payments of principal of the Notes in such Series in
inverse order of their scheduled due dates.
8.3. Allocation of Partial Prepayments.
In the case of each partial prepayment of the Notes of
any Series pursuant to Section 8.1 or 8.2, the principal amount
of the Notes to be prepaid shall be allocated among all of the
Notes of such Series at the time outstanding in proportion, as
nearly as practicable, to the respective unpaid outstanding
principal amounts thereof.
8.4. Maturity; Surrender, etc.
In the case of each prepayment of Notes pursuant to
this Section 8, the principal amount of each Note to be prepaid
shall mature and become due and payable on the date fixed for
such prepayment, together with interest on such principal amount
accrued to such date and the applicable Make-Whole Amount, if
any. From and after such date, unless the Company shall fail to
pay such principal amount when so due and payable, together with
the interest and Make-Whole Amount, if any, as aforesaid,
interest on such principal amount shall cease to accrue. Any
Note paid or prepaid in full shall be surrendered to the Company
and canceled and shall not be reissued, and no Note shall be
issued in lieu of any prepaid principal amount of any Note.
8.5. Purchase of Notes.
The Company will not and will not permit any Affiliate
to purchase, redeem, prepay or otherwise acquire, directly or
indirectly, any of the outstanding Notes except upon the payment
or prepayment of the Notes in accordance with the terms of this
Agreement and the Notes. The Company will promptly cancel all
Notes acquired by it or any Affiliate pursuant to any payment,
prepayment or purchase of Notes pursuant to any provision of this
Agreement and no Notes may be issued in substitution or exchange
for any such Notes.
8.6. Make-Whole Amount.
The term "Make-Whole Amount" means, with respect to any
Note, an amount equal to the excess, if any, of the Discounted
Value of the Remaining Scheduled Payments with respect to the
Called Principal of such Note over the amount of such Called
Principal, provided that the Make-Whole Amount may in no event be
less than zero. For the purposes of determining the Make-Whole
Amount, the following terms have the following meanings:
"Called Principal" means, with respect to any Note, the
principal of such Note that is to be prepaid pursuant to
Section 8.2 or has become or is declared to be immediately
due and payable pursuant to Section 12.1, as the context
requires.
"Designated Spread" shall mean 0% in the case of each
Note of any Series unless the Confirmation of Acceptance
with respect to the Notes of such Series specifies a
different Designated Spread in which case it shall mean,
with respect to each Note of such Series, the Designated
Spread so specified.
"Discounted Value" means, with respect to the Called
Principal of any Note, the amount obtained by discounting
all Remaining Scheduled Payments with respect to such Called
Principal from their respective scheduled due dates to the
Settlement Date with respect to such Called Principal, in
accordance with accepted financial practice and at a
discount factor (applied on the same periodic basis as that
on which interest on the Notes is payable) equal to the
Reinvestment Yield with respect to such Called Principal.
"Reinvestment Yield" means, with respect to the Called
Principal of any Note, the Designated Spread over the yield
to maturity implied by (i) the yields reported, as of
10:00 A.M. (New York City time) on the second Business Day
preceding the Settlement Date with respect to such Called
Principal, on the display designated as "Page PX1" on
Bloomberg Financial Markets PX1 ("Bloomberg") (or such other
display as may replace Page PX1 on Bloomberg) for actively
traded U.S. Treasury securities having a maturity equal to
the Remaining Average Life of such Called Principal as of
such Settlement Date, or (ii) if such yields are not
reported as of such time or the yields reported as of such
time are not ascertainable, the Treasury Constant Maturity
Series Yields reported, for the latest day for which such
yields have been so reported as of the second Business Day
preceding the Settlement Date with respect to such Called
Principal, in Federal Reserve Statistical Release H.15 (519)
(or any comparable successor publication) for actively
traded U.S. Treasury securities having a constant maturity
equal to the Remaining Average Life of such Called Principal
as of such Settlement Date. Such implied yield will be
determined, if necessary, by (x) converting U.S. Treasury
▇▇▇▇ quotations to bond-equivalent yields in accordance with
accepted financial practice and (y) interpolating linearly
between (1) the actively traded U.S. Treasury security with
the duration closest to and greater than the Remaining
Average Life and (2) the actively traded U.S. Treasury
security with the duration closest to and less than the
Remaining Average Life.
"Remaining Average Life" means, with respect to any
Called Principal, the number of years (calculated to the
nearest one-twelfth year) obtained by dividing (i) such
Called Principal into (ii) the sum of the products obtained
by multiplying (a) the principal component of each Remaining
Scheduled Payment with respect to such Called Principal by
(b) the number of years (calculated to the nearest one-
twelfth year) that will elapse between the Settlement Date
with respect to such Called Principal and the scheduled due
date of such Remaining Scheduled Payment.
"Remaining Scheduled Payments" means, with respect to
the Called Principal of any Note, all payments of such
Called Principal and interest thereon that would be due
after the Settlement Date with respect to such Called
Principal if no payment of such Called Principal were made
prior to its scheduled due date, provided that if such
Settlement Date is not a date on which interest payments are
due to be made under the terms of the Notes, then the amount
of the next succeeding scheduled interest payment will be
reduced by the amount of interest accrued to such Settlement
Date and required to be paid on such Settlement Date
pursuant to Section 8.2 or 12.1.
"Settlement Date" means, with respect to the Called
Principal of any Note, the date on which such Called
Principal is to be prepaid pursuant to Section 8.2 or has
become or is declared to be immediately due and payable
pursuant to Section 12.1, as the context requires.
9. AFFIRMATIVE COVENANTS.
The Company covenants that so long as any of the Notes
are outstanding:
9.1. Compliance with Law.
The Company will and will cause each of its
Subsidiaries to comply with all laws, ordinances or governmental
rules or regulations to which each of them is subject, including,
without limitation, Environmental Laws, and will obtain and
maintain in effect all licenses, certificates, permits,
franchises and other governmental authorizations necessary to the
ownership of their respective properties or to the conduct of
their respective businesses, in each case to the extent necessary
to ensure that non-compliance with such laws, ordinances or
governmental rules or regulations or failure to obtain or
maintain in effect such licenses, certificates, permits,
franchises and other governmental authorizations could not,
individually or in the aggregate, reasonably be expected to have
a Material Adverse Effect.
9.2. Insurance.
The Company will and will cause each of its Restricted
Subsidiaries to maintain, insurance with respect to their
respective properties and businesses against such casualties and
contingencies, of such types, on such terms and in such amounts
(including deductibles, co-insurance and self-insurance, if
adequate reserves are maintained with respect thereto) as is
customary in the case of entities engaged in the same or a
similar business and similarly situated.
9.3. Maintenance of Properties.
The Company will and will cause each of its
Subsidiaries to maintain and keep, or cause to be maintained and
kept, their respective properties in good repair, working order
and condition (other than ordinary wear and tear) so that the
business carried on in connection therewith may be properly
conducted at all times, provided that this Section shall not
prevent the Company or any Subsidiary from discontinuing the
operation and the maintenance of any of its properties if such
discontinuance is desirable in the conduct of its business and
the Company has concluded that such discontinuance could not,
individually or in the aggregate, reasonably be expected to have
a Material Adverse Effect.
9.4. Payment of Taxes.
The Company will and will cause each of its
Subsidiaries to file all income tax or similar tax returns
required to be filed in any jurisdiction and to pay and discharge
all taxes shown to be due and payable on such returns and all
other taxes, assessments, governmental charges, or levies payable
by any of them, to the extent such taxes and assessments have
become due and payable and before they have become delinquent,
provided that neither the Company nor any Subsidiary need pay any
such tax or assessment if (i) the amount, applicability or
validity thereof is contested by the Company or such Subsidiary
on a timely basis in good faith and in appropriate proceedings,
and the Company or a Subsidiary has established adequate reserves
therefor in accordance with GAAP on the books of the Company or
such Subsidiary or (ii) the nonpayment of all such taxes and
assessments in the aggregate could not reasonably be expected to
have a Material Adverse Effect.
9.5. Corporate Existence, etc.
Subject to Section 10.7, the Company will at all times
preserve and keep in full force and effect its corporate
existence. Subject to Section 10.7, the Company will at all
times preserve and keep in full force and effect the corporate
existence of each of its Subsidiaries (unless merged into the
Company or a Subsidiary) and all rights and franchises of the
Company and its Subsidiaries unless, in the good faith judgment
of the Company, the termination of or failure to preserve and
keep in full force and effect such corporate existence, right or
franchise could not, individually or in the aggregate, have a
Material Adverse Effect.
9.6. Information Required by Rule 144A.
The Company will, upon the request of the holder of any
Note, provide such holder, and any qualified institutional buyer
designated by such holder, such financial and other information
as such holder and the Company may reasonably determine to be
necessary in order to permit compliance with the information
requirements of Rule 144A under the Securities Act in connection
with the resale of Notes, except at such times as the Company is
subject to the reporting requirements of Sections 13 or 15(d) of
the Exchange Act. For the purpose of this paragraph, the term
"qualified institutional buyer" shall have the meaning specified
in Rule 144A under the Securities Act.
9.7. Covenant to Secure Notes Equally.
If the Company or any Restricted Subsidiary shall
create or assume any Lien upon any of its property or assets,
whether now owned or hereafter acquired, other than Liens
permitted by Section 10.4 (unless prior written consent to the
creation or assumption thereof shall have been obtained pursuant
to this Agreement), the Company will make or cause to be made
effective provisions whereby the Notes will be secured by such
Lien equally and ratably with any and all other Indebtedness so
long as such Indebtedness shall be so secured.
10. NEGATIVE COVENANTS.
The Company covenants that so long as any of the Notes
are outstanding:
10.1. Maximum Company Capitalization Ratio.
The Company shall not permit the Company's
Capitalization Ratio to exceed 60% as of the end of any fiscal
quarter during the term hereof.
10.2. Minimum Interest Coverage Ratio.
The Company shall not permit the ratio of EBITDA to
Interest Expense, in each case calculated for the period of four
consecutive fiscal quarters ending on the date of calculation, to
be less than 1.75 to 1.00 as of the last day of any fiscal
quarter during the term hereof.
10.3. Consolidated Net Worth.
The Company shall not permit Consolidated Net Worth at
any time to be less than $530,000,000.
10.4. Limitation on Liens.
The Company shall not, and shall not suffer or permit
any Restricted Subsidiary to, directly or indirectly, make,
create, incur, assume or suffer to exist any Lien upon or with
respect to any part of its property, whether now owned or
hereafter acquired, other than the following ("Permitted Liens"):
(a) any Lien existing on property of the Company or
any Restricted Subsidiary on the date of this Agreement and set
forth in Schedule 10.4 securing Indebtedness outstanding on such
date and any Lien renewing, extending or refunding such Lien,
provided that (i) the principal amount of the Indebtedness
secured by the subject Liens is not increased over the amount of
the Indebtedness secured thereby immediately prior to such
extension, renewal or refunding, (ii) such Lien is not extended
to any other property and (iii) immediately after such extension,
renewal or refunding, no Default or Event of Default would exist;
(b) any Lien created under any Loan Document;
(c) Liens for taxes, fees, assessments or other
governmental charges which are not delinquent or remain payable
without penalty, or to the extent that non-payment thereof is
permitted by Section 9.4;
(d) carriers', warehousemen's, mechanics', landlords',
materialmen's, repairmen's, operators' (including Liens arising
under operating, pooling or unitizing agreements of a scope and
nature customary in the oil and gas industry) or other similar
Liens arising in the ordinary course of business which are not
delinquent or remain payable without penalty or which are being
contested in good faith and by appropriate proceedings, which
proceedings have the effect of preventing the forfeiture or sale
of the property subject thereto;
(e) Liens (other than any Lien imposed by ERISA) in
connection with workers' compensation laws, unemployment
insurance and other social security or retirement benefits, or
similar legislation;
(f) Liens on the property of the Company or its
Restricted Subsidiaries securing (i) the non-delinquent
performance of bids, trade contracts (other than for borrowed
money), leases, statutory obligations, (ii) contingent
obligations on surety, reclamation and appeal bonds, and
(iii) other non-delinquent obligations of a like nature, in each
case, incurred in the ordinary course of business, provided all
such Liens in the aggregate would not (even if enforced) cause a
Material Adverse Effect;
(g) easements, rights-of-way, restrictions and other
similar encumbrances incurred in the ordinary course of business
which, in the aggregate, are not substantial in amount, and which
do not in any case materially detract from the value of the
property subject thereto or interfere with the ordinary conduct
of the businesses of the Company and its Restricted Subsidiaries;
(h) Liens arising solely by virtue of any statutory or
common law provision relating to banker's liens, rights of set-
off or similar rights and remedies as to deposit accounts or
other funds maintained with a creditor depository institution;
provided that (i) such deposit account is not a dedicated cash
collateral account and is not subject to restrictions against
access by the Company in excess of those set forth by regulations
promulgated by the FRB, and (ii) such deposit account is not
intended by the Company or any Subsidiary to provide collateral
to the depository institution;
(i) Liens consisting of judgment or judicial
attachment liens, provided that the enforcement of such Liens is
effectively stayed and all such Liens in the aggregate at any
time outstanding for the Company and its Restricted Subsidiaries
do not exceed $50,000,000;
(j) Liens on assets of Persons which become Restricted
Subsidiaries after the Effective Date or Liens existing on any
property acquired by the Company or any Restricted Subsidiary at
the time such property is acquired, provided that such Liens
existed at the time the respective Persons became Subsidiaries or
at the time such property was acquired, as applicable, and were
not created in anticipation thereof; and
(k) other Liens securing Indebtedness or judgments
otherwise permitted herein outstanding in compliance with Section 10.5.
10.5. Limitation on Priority Debt.
The Company will not at any time permit the aggregate
outstanding principal amount of Priority Debt (excluding the
Williston Basin Notes) to exceed 20% of Consolidated Net Worth.
10.6. Limitation on Sale of Assets.
The Company will not, and will not permit any
Restricted Subsidiary to, make any Asset Sale; provided, that so
long as no Default or Event of Default exists both immediately
prior to and after giving effect to any Asset Sale, the Company
or any Restricted Subsidiary may make any Asset Sale if (1)(a)
the Gross Proceeds Amount from such Asset Sale plus the Gross
Proceeds Amounts from all other Asset Sales during the then
current fiscal year do not exceed 15% of Consolidated Total
Assets as at the end of the prior fiscal year and (b) the EBITDA
attributable to such property or assets plus the EBITDA
attributable to all other properties and assets subject to Asset
Sales during the then current fiscal year does not exceed 15% of
EBITDA in any of the three preceding fiscal years (beginning with
the 2001 fiscal year), and (2)(a) the sum of all Gross Proceeds
Amounts from all Asset Sales occurring after the Effective Date
does not exceed 40% of Consolidated Total Assets as at the end of
the prior fiscal year and (b) the EBITDA attributable to the
property or assets the subject of such proposed Asset Sale for
the fiscal year prior to such proposed Asset Sale plus the EBITDA
from the property or assets the subject of Asset Sales after the
Effective Date (in the case of each Asset Sale, for the fiscal
year ending immediately prior to such Asset Sale) does not exceed
40% of EBITDA, in any of the three fiscal years preceding such
proposed Asset Sale (beginning with the 2001 fiscal year);
provided, further, that Asset Sales in excess of the foregoing
limits may be made if the Excess Proceeds Amount (i) (x) is
applied to a Property Reinvestment Application within six months
(or 12 months if the Excess Proceeds Amount is invested, not
later than the end of the sixth month, in United States
Governmental Securities maturing within 365 days after the
closing date of any such Asset Sale) after any such Asset Sale
and (y) is held, free from any Liens, prior to such Property
Reinvestment Application in a segregated bank account with a bank
that is not a creditor of the Company or any Subsidiary or, in
the case of United States Governmental Securities, in a
segregated account with an Acceptable Broker-Dealer which is not
a creditor of the Company or any Subsidiary; or (ii) applied to
the prepayment of the Notes pursuant to Section 8.2 within 30
days after such Asset Sale causing the foregoing limits to be
exceeded.
10.7. Consolidations and Mergers.
The Company shall not, and shall not suffer or permit
any Restricted Subsidiary to, merge or consolidate with or into,
or convey, transfer, lease or otherwise dispose of (whether in
one transaction or in a series of transactions) all or
substantially all of its assets (whether now owned or hereafter
acquired) to or in favor of, any Person, except:
(a) any Restricted Subsidiary may merge or consolidate
with or into (i) the Company, provided that the Company shall be
the continuing or surviving corporation, or (ii) any one or more
Restricted Subsidiaries, provided that if any transaction shall be
between a Restricted Subsidiary and a Wholly-Owned Restricted Subsidiary,
the Wholly-Owned Restricted Subsidiary shall be the continuing or
surviving corporation;
(b) any Restricted Subsidiary may convey, transfer,
lease or otherwise dispose of all or substantially all of its
assets in compliance with the provisions of Section 10.6;
(c) any Restricted Subsidiary may convey, transfer,
lease or otherwise dispose of all or substantially all of its
assets (upon voluntary liquidation or otherwise) to the Company
or another Wholly-Owned Restricted Subsidiary; and
(d) any Restricted Subsidiary may merge, consolidate
or combine with or into any Person provided that the successor
formed by such consolidation or combination or the survivor of
such merger is a Restricted Subsidiary and the Company directly
or indirectly through Wholly-Owned Restricted Subsidiaries owns
at least the same percentage of outstanding stock of the
successor or survivor Restricted Subsidiary as the Restricted
Subsidiary involved in the consolidation, combination or merger;
provided that the foregoing restrictions shall not apply to the
consolidation or merger of the Company with, or the conveyance,
transfer or lease of substantially all of the assets of the
Company in a single transaction or series of transactions to, any
Person so long as:
(i) the successor formed by such consolidation or the
survivor of such merger or the Person that acquires by
conveyance, transfer or lease substantially all of the
assets of the Company as an entirety, as the case may be
(the "Successor Corporation"), shall be a solvent
corporation organized and existing under the laws of the
United States of America, any State thereof or the District
of Columbia;
(ii) if the Company is not the Successor Corporation,
such corporation (x) shall have executed and delivered to
each holder of Notes its assumption of the due and punctual
performance and observance of each covenant and condition of
this Agreement and the Notes and (y) shall have caused to be
delivered to each holder of any Notes an opinion of
independent counsel, or of counsel to the Successor
Corporation, which counsel and opinion must be reasonably
satisfactory to the Required Holders, to the effect that all
agreements or instruments effecting such assumption are
enforceable in accordance with their terms and comply with
the terms hereof; and
(iii)immediately before and after giving effect to
such transaction no Default or Event of Default shall exist.
No such conveyance, transfer or lease of substantially all of the
assets of the Company shall have the effect of releasing the
Company or any Successor Corporation from its liability under
this Agreement or the Notes.
10.8. Loans and Investments.
The Company shall not purchase, acquire or own, or
suffer or permit any Restricted Subsidiary to purchase, acquire
or own, any capital stock, equity interest, or any obligations or
other securities of, or any interest in, any Person, or make any
Acquisitions, or make any advance, loan, extension of credit or
capital contribution to or any other investment in, any Person
including any Affiliate of the Company, except for:
(a) investments in cash equivalents and short-term
marketable securities pursuant to and in accordance with the
terms of the Company's then-current investment policy duly
adopted by the board of directors of the Company (the "Investment
Policy") and investments in the MDU Resources Group, Inc.
Benefits Protection Trust;
(b) extensions of credit in the nature of accounts
receivable or notes receivable arising from the sale or lease of
goods or services in the ordinary course of business;
(c) advances, loans and other extensions of credit by
the Company to any of its Wholly-Owned Restricted Subsidiaries or
by any of its Wholly-Owned Restricted Subsidiaries to another of
its Wholly-Owned Restricted Subsidiaries;
(d) equity investments in or capital contributions to
any Wholly-Owned Restricted Subsidiary by the Company or any of
its Wholly-Owned Restricted Subsidiaries;
(e) investments, advances, loans, extensions of credit
or capital contributions incurred or made in order to consummate
Acquisitions (other than any Acquisitions of an Unrestricted
Subsidiary), provided that such Acquisitions are undertaken in
accordance with all material applicable Requirements of Law and
the prior, effective written consent or approval to such
Acquisition of the board of directors or equivalent governing
body of the acquiree is obtained;
(f) investments, advances, loans, extensions of credit
or capital contributions by the Company in or to Unrestricted
Subsidiaries (including, without limitation, making an investment
in an Unrestricted Subsidiary by converting a Restricted
Subsidiary to an Unrestricted Subsidiary) or acquisitions of
equity interests in Unrestricted Subsidiaries, provided that at
no time shall the EBITDA of all Unrestricted Subsidiaries for the
period of four consecutive fiscal quarters most recently ended be
greater than 33% of the EBITDA of the Company and its
Subsidiaries for the period of four consecutive fiscal quarters
most recently ended; or
(g) other investments provided that the aggregate
amount of investments permitted by this clause (g) shall not at
any time exceed 10% of Consolidated Net Worth.
10.9. Transactions with Affiliates.
The Company shall not enter into any material
transaction or arrangement or series of related transactions or
arrangements that in the aggregate would be material with any
Affiliate of the Company, and the Company shall not suffer or
permit any Restricted Subsidiary to enter into any material
transaction or arrangement or series of related transactions or
arrangements that in the aggregate would be material with any
Affiliate of the Company other than another Restricted Subsidiary
of the Company that is a Wholly-Owned Restricted Subsidiary,
except (i) upon fair and reasonable terms no less favorable to
the Company or such Restricted Subsidiary than would obtain,
taking into account all facts and circumstances, in a comparable
arm's-length transaction with a Person not an Affiliate of the
Company or such Restricted Subsidiary or (ii) (A) in the ordinary
course and pursuant to the reasonable requirements of the
business of Williston Basin Interstate Pipeline Company
("Williston Basin") as may be required by the Federal Energy
Regulatory Commission or other appropriate Governmental
Authorities having jurisdiction over Williston Basin, or (B)
pursuant to that certain Asset Purchase Agreement, dated August
6, 1985, by and between Montana-Dakota Utilities Co. ("Montana-
Dakota") and Williston Basin entered into in furtherance of the
Revised Stipulation and Agreement of Settlement in FERC Docket
No. CP82-487-000 et al. (the "Settlement Agreement"), to the
extent that Article Twelve thereof requires Williston Basin, if
and when it implements a pricing mechanism for Williston Basin
owned production which results in prices higher than cost-of-
service pricing for such production, to make a payment to Montana-
Dakota which is equal in amount to the adjustment made by Montana-
Dakota pursuant to Section 10.1 of said Settlement Agreement,
provided, that all such transactions and agreements permitted by
this clause (ii) do not, individually or in the aggregate, result
in a Material Adverse Effect.
10.10. Use of Proceeds.
The Company shall not, and shall not suffer or permit
any Subsidiary to, use any portion of the proceeds of the Notes,
directly or indirectly, (i) to purchase or carry Margin Stock,
(ii) to repay or otherwise refinance Indebtedness of the Company
or others incurred to purchase or carry Margin Stock, (iii) to
extend credit for the purpose of purchasing or carrying any
Margin Stock, or (iv) to make any Acquisition that is opposed by
either the board of directors, or by stockholders possessing a
majority of the voting power of the outstanding voting stock, of
the entity that is subject to, or whose assets are the subject
of, such Acquisition.
10.11. Agreements Restricting Subsidiary Dividends.
With the exception of (a) the referenced sections of
the existing agreements specified in Schedule 5.4, (b) Subsidiary
Organization Documents and Requirements of Law and (c)
agreements, instruments or other documents, evidencing
Indebtedness having an aggregate principal amount not in excess
of $15,000,000, to which any Person which becomes a Restricted
Subsidiary after December 27, 1999 is a party, that existed at
the time the Person became a Restricted Subsidiary and were not
entered into in anticipation thereof, the Company agrees that it
will not, and it will not permit any of its Restricted
Subsidiaries to, be a party to or enter into any agreement,
instrument or other document which contractually prohibits or
restricts the ability of any Restricted Subsidiary to pay
dividends or make any other similar distributions to the Company
or any of its Restricted Subsidiaries that owns outstanding
shares of capital stock or similar equity interests of such
Restricted Subsidiary.
10.12. Restrictions on Subsidiary Guarantees.
The Company shall not permit any Restricted Subsidiary
to guaranty any Indebtedness of the Company unless simultaneously
with the issuance of any such third party guarantees (i) such
Restricted Subsidiary issues a Subsidiary Guarantee to the
holders of the Notes in respect of the Obligations and (ii) the
beneficiaries of any such guaranty enter into an intercreditor
agreement with the holders of the Notes that is satisfactory in
form and substance to the Required Holders providing for, among
other things, the sharing of all payments made under any guaranty
of a Restricted Subsidiary.
10.13. Terrorism Sanctions Regulations.
The Company will not and will not permit any Subsidiary
to (a) become a Person described or designated in the Specially
Designated Nationals and Blocked Persons List of the Office of
Foreign Assets Control or in Section 1 of the Anti-Terrorism
Order or (b) engage in any dealings or transactions with any such
Person.
11. EVENTS OF DEFAULT.
An "Event of Default" shall exist if any of the
following conditions or events shall occur and be continuing:
(a) the Company defaults in the payment of any
principal, Make-Whole Amount, if any, on any Note when the
same becomes due and payable, whether at maturity or at a
date fixed for prepayment or by declaration or otherwise; or
(b) the Company defaults in the payment of any
interest on any Note for more than 10 days after the same
becomes due and payable; or
(c) (i) the Company defaults in the performance of or
compliance with any term contained in Sections 10.1 through
10.12, inclusive, or Section 7.1(g); or
(d) the Company defaults in the performance of or
compliance with any term contained herein (other than those
referred to in paragraphs (a), (b) and (c) of this
Section 11) and such default is not remedied within 30 days
after the earlier of (i) a Senior Financial Officer
obtaining actual knowledge of such default and (ii) the
Company receiving written notice of such default from any
holder of a Note (any such written notice to be identified
as a "notice of default" and to refer specifically to this
paragraph (d) of Section 11); or
(e) any representation or warranty made in writing by
or on behalf of the Company or by any officer of the Company
in this Agreement or in any writing furnished in connection
with the transactions contemplated hereby proves to have
been false or incorrect in any material respect on the date
as of which made; or
(f) (i) the Company or any Restricted Subsidiary is in
default (as principal or as guarantor or other surety) in
the payment of any principal of or premium or make-whole
amount or interest on any Indebtedness that is outstanding
in an aggregate principal amount of at least $50,000,000
beyond any period of grace provided with respect thereto, or
(ii) the Company or any Restricted Subsidiary is in default
in the performance of or compliance with any term of any
evidence of any Indebtedness in an aggregate outstanding
principal amount of at least $50,000,000 or of any mortgage,
indenture or other agreement relating thereto or any other
condition exists, and as a consequence of such default or
condition such Indebtedness has become, or has been declared
(or one or more persons are entitled to declare such
Indebtedness to be), due and payable before its stated
maturity or before its regularly scheduled dates of payment,
or (iii) as a consequence of the occurrence or continuation
of any event or condition (other than the passage of time or
the right of the holder of Indebtedness to convert such
Indebtedness into equity interests), (x) the Company or any
Restricted Subsidiary has become obligated to purchase or
repay Indebtedness before its regular maturity or before its
regularly scheduled dates of payment in an aggregate
outstanding principal amount of at least $50,000,000, or (y)
one or more Persons have the right to require the Company or
any Restricted Subsidiary so to purchase or repay such
Indebtedness; or
(g) the Company or any Significant Subsidiary (i) is
generally not paying, or admits in writing its inability to
pay, its debts as they become due, (ii) files, or consents
by answer or otherwise to the filing against it of, a
petition for relief or reorganization or arrangement or any
other petition in bankruptcy, for liquidation or to take
advantage of any bankruptcy, insolvency, reorganization,
moratorium or other similar law of any jurisdiction,
(iii) makes an assignment for the benefit of its creditors,
(iv) consents to the appointment of a custodian, receiver,
trustee or other officer with similar powers with respect to
it or with respect to any substantial part of its property,
(v) is adjudicated as insolvent or to be liquidated, or
(vi) takes corporate action for the purpose of any of the
foregoing; or
(h) a court or governmental authority of competent
jurisdiction enters an order appointing, without consent by
the Company or any Significant Subsidiary, a custodian,
receiver, trustee or other officer with similar powers with
respect to it or with respect to any substantial part of its
property, or constituting an order for relief or approving a
petition for relief or reorganization or any other petition
in bankruptcy or for liquidation or to take advantage of any
bankruptcy or insolvency law of any jurisdiction, or
ordering the dissolution, winding-up or liquidation of the
Company or any Significant Subsidiary, or any such petition
shall be filed against the Company or any Significant
Subsidiary and such petition shall not be dismissed within
60 days; or
(i) a final judgment or judgments for the payment of
money aggregating in excess of $15,000,000 are rendered
against one or more of the Company and its Subsidiaries and
which judgments are not, within 60 days after entry thereof,
bonded, discharged or stayed pending appeal, or are not
discharged within 60 days after the expiration of such stay;
(j) (i) an ERISA Event or ERISA Termination Event
shall occur with respect to a Pension Plan or Multiemployer
Plan which has resulted or would reasonably be expected to
result in liability of the Company under Title IV of ERISA
to the Pension Plan, Multiemployer Plan or the PBGC in an
aggregate amount in excess of 10% of Consolidated Net Worth;
(ii) the commencement or increase of contributions to, or
the adoption of or the amendment of, a Pension Plan by the
Company or an ERISA Affiliate which has resulted or could
reasonably be expected to result in an increase in Unfunded
Pension Liability among all Pension Plans in an aggregate
amount in excess of 10% of Consolidated Net Worth; or
(iii) the Company or an ERISA Affiliate shall fail to pay
when due, after the expiration of any applicable grace
period, any installment payment with respect to its
withdrawal liability under Section 4201 of ERISA under a
Multiemployer Plan which has resulted or could reasonably be
expected to result in a Material Adverse Effect; or
(k) there occurs any Change of Control; or
(l) a default shall occur under any Subsidiary
Guarantee, or a Subsidiary Guarantee is for any reason
partially (including with respect to future advances) or
wholly revoked or invalidated, or otherwise ceases to be in
full force and effect, or a Subsidiary Guarantor contests in
any manner the validity or enforceability thereof or denies
that it has any further liability thereunder, or any event
described in subsections (g) or (h) of this Section 11
occurs with respect to any Subsidiary Guarantor; or
(m) any Loan Document ceases to be in full force and
effect or the Company contests in any manner the validity or
enforceability thereof.
12. REMEDIES ON DEFAULT, ETC.
12.1. Acceleration.
(a) If an Event of Default with respect to the Company
described in paragraph (g) or (h) of Section 11 (other than an
Event of Default described in clause (i) of paragraph (g) or
described in clause (vi) of paragraph (g) by virtue of the fact
that such clause encompasses clause (i) of paragraph (g)) has
occurred, all the Notes then outstanding shall automatically
become immediately due and payable.
(b) If any other Event of Default has occurred and is
continuing, the Required Holders of the Notes at the time
outstanding may at any time at its or their option, by notice or
notices to the Company, declare all the Notes then outstanding to
be immediately due and payable.
(c) If any Event of Default described in paragraph (a)
or (b) of Section 11 has occurred and is continuing, any holder
or holders of Notes at the time outstanding affected by such
Event of Default may at any time, at its or their option, by
notice or notices to the Company, declare all the Notes held by
it or them to be immediately due and payable.
Upon any Notes becoming due and payable under this
Section 12.1, whether automatically or by declaration, such Notes
will forthwith mature and the entire unpaid principal amount of
such Notes, plus (x) all accrued and unpaid interest thereon and
(y) the Make-Whole Amount determined in respect of such principal
amount (to the full extent permitted by applicable law), shall
all be immediately due and payable, in each and every case
without presentment, demand, protest or further notice, all of
which are hereby waived. The Company acknowledges, and the
parties hereto agree, that each holder of a Note has the right to
maintain its investment in the Notes free from repayment by the
Company (except as herein specifically provided for) and that the
provision for payment of a Make-Whole Amount by the Company in
the event that the Notes are prepaid or are accelerated as a
result of an Event of Default, is intended to provide
compensation for the deprivation of such right under such
circumstances.
12.2. Other Remedies.
If any Default or Event of Default has occurred and is
continuing, and irrespective of whether any Notes have become or
have been declared immediately due and payable under Section
12.1, the holder of any Note at the time outstanding may proceed
to protect and enforce the rights of such holder by an action at
law, suit in equity or other appropriate proceeding, whether for
the specific performance of any agreement contained herein or in
any Note, or for an injunction against a violation of any of the
terms hereof or thereof, or in aid of the exercise of any power
granted hereby or thereby or by law or otherwise.
12.3. Rescission.
At any time after any Notes have been declared due and
payable pursuant to clause (b) or (c) of Section 12.1, the
Required Holders of the Notes, by written notice to the Company,
may rescind and annul any such declaration and its consequences
if (a) the Company has paid all overdue interest on the Notes,
all principal of and Make-Whole Amount, if any, on any Notes that
are due and payable and are unpaid other than by reason of such
declaration, and all interest on such overdue principal and Make-
Whole Amount, if any, and (to the extent permitted by applicable
law) any overdue interest in respect of the Notes, at the Default
Rate, (b) all Events of Default and Defaults, other than non-
payment of amounts that have become due solely by reason of such
declaration, have been cured or have been waived pursuant to
Section 17, and (c) no judgment or decree has been entered for
the payment of any monies due pursuant hereto or to the Notes.
No rescission and annulment under this Section 12.3 will extend
to or affect any subsequent Event of Default or Default or impair
any right consequent thereon.
12.4. No Waivers or Election of Remedies, Expenses, etc.
No course of dealing and no delay on the part of any
holder of any Note in exercising any right, power or remedy shall
operate as a waiver thereof or otherwise prejudice such holder's
rights, powers or remedies. No right, power or remedy conferred
by this Agreement or by any Note upon any holder thereof shall be
exclusive of any other right, power or remedy referred to herein
or therein or now or hereafter available at law, in equity, by
statute or otherwise. Without limiting the obligations of the
Company under Section 15, the Company will pay to the holder of
each Note on demand such further amount as shall be sufficient to
cover all costs and expenses of such holder incurred in any
enforcement or collection under this Section 12, including,
without limitation, reasonable attorneys' fees, expenses and
disbursements.
13. REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES.
13.1. Registration of Notes.
The Company shall keep at its principal executive
office a register for the registration and registration of
transfers of Notes. The name and address of each holder of one
or more Notes, each transfer thereof and the name and address of
each transferee of one or more Notes shall be registered in such
register. Prior to due presentment for registration of transfer,
the Person in whose name any Note shall be registered shall be
deemed and treated as the owner and holder thereof for all
purposes hereof, and the Company shall not be affected by any
notice or knowledge to the contrary. The Company shall give to
any holder of a Note that is an Institutional Investor promptly
upon request therefor, a complete and correct copy of the names
and addresses of all registered holders of Notes.
13.2. Transfer and Exchange of Notes.
Upon surrender of any Note at the principal executive
office of the Company for registration of transfer or exchange
(and in the case of a surrender for registration of transfer,
duly endorsed or accompanied by a written instrument of transfer
duly executed by the registered holder of such Note or his
attorney duly authorized in writing and accompanied by the
address for notices of each transferee of such Note or part
thereof), the Company shall execute and deliver, at the Company's
expense (except as provided below), one or more new Notes (as
requested by the holder thereof) in exchange therefor, in an
aggregate principal amount equal to the unpaid principal amount
of the surrendered Note. Each such new Note shall be payable to
such Person as such holder may request and shall be substantially
in the form of Exhibit 1. Each such new Note shall be dated and
bear interest from the date to which interest shall have been
paid on the surrendered Note or dated the date of the surrendered
Note if no interest shall have been paid thereon. The Company
may require payment of a sum sufficient to cover any stamp tax or
governmental charge imposed in respect of any such transfer of
Notes. Notes shall not be transferred in denominations of less
than $2,000,000, provided that if necessary to enable the
registration of transfer by a holder of its entire holding of
Notes, one Note may be in a denomination of less than $2,000,000.
Any transferee, by its acceptance of a Note registered in its
name (or the name of its nominee), shall be deemed to have made
the representation set forth in Section 6.2.
13.3. Replacement of Notes.
Upon receipt by the Company of evidence reasonably
satisfactory to it of the ownership of and the loss, theft,
destruction or mutilation of any Note (which evidence shall be,
in the case of an Institutional Investor, notice from such
Institutional Investor of such ownership and such loss, theft,
destruction or mutilation), and
(a) in the case of loss, theft or destruction, of
indemnity reasonably satisfactory to it (provided that if
the holder of such Note is a Prudential Affiliate, or a
nominee of a Prudential Affiliate, or another holder of a
Note with a minimum net worth of at least $50,000,000, a
Prudential Affiliate's or such other holder's own unsecured
agreement of indemnity shall be deemed to be satisfactory),
or
(b) in the case of mutilation, upon surrender and
cancellation thereof, the Company at its own expense shall
execute and deliver, in lieu thereof, a new Note, dated and
bearing interest from the date to which interest shall have
been paid on such lost, stolen, destroyed or mutilated Note
or dated the date of such lost, stolen, destroyed or
mutilated Note if no interest shall have been paid thereon.
14. PAYMENTS ON NOTES.
14.1. Place of Payment.
Subject to Section 14.2, payments of principal, Make-
Whole Amount, if any, and interest becoming due and payable on
the Notes shall be made in New York, New York, at the principal
office of The Bank of New York in such jurisdiction. The Company
may at any time, by notice to each holder of a Note, change the
place of payment of the Notes so long as such place of payment
shall be either the principal office of the Company in such
jurisdiction or the principal office of a bank or trust company
in such jurisdiction.
14.2. Home Office Payment.
So long as any Purchaser shall be the holder of any
Note, and notwithstanding anything contained in Section 14.1 or
in such Note to the contrary, the Company will pay all sums
becoming due on such Note for principal, Make-Whole Amount, if
any, and interest by the method and at the address specified for
such purpose below such Purchaser's name in Schedule A, or by
such other method or at such other address as a holder of Notes
shall have from time to time specified to the Company in writing
for such purpose, without the presentation or surrender of such
Note or the making of any notation thereon, except that upon
written request of the Company made concurrently with or
reasonably promptly after payment or prepayment in full of any
Note, such Purchaser shall surrender such Note for cancellation,
reasonably promptly after any such request, to the Company at its
principal executive office or at the place of payment most
recently designated by the Company pursuant to Section 14.1.
Prior to any sale or other disposition of any Note held by a
Purchaser, such Purchaser will, at its election, either endorse
thereon the amount of principal paid thereon and the last date to
which interest has been paid thereon or surrender such Note to
the Company in exchange for a new Note or Notes pursuant to
Section 13.2. The Company will afford the benefits of this
Section 14.2 to any Institutional Investor that is the direct or
indirect transferee of any Note purchased by any Purchaser under
this Agreement and that has made the same agreement relating to
such Note as the Purchasers have made in this Section 14.2.
15. EXPENSES, ETC.
15.1. Transaction Expenses.
Whether or not the transactions contemplated hereby are
consummated, the Company will pay all costs and expenses
(including reasonable attorneys' fees of a special counsel and,
if reasonably required, local or other counsel) incurred by a
Purchaser or each other holder of a Note in connection with such
transactions and in connection with any amendments, waivers or
consents under or in respect of this Agreement or the Notes
(whether or not such amendment, waiver or consent becomes
effective), including, without limitation: (a) the costs and
expenses incurred in enforcing or defending (or determining
whether or how to enforce or defend) any rights under this
Agreement or the Notes or in responding to any subpoena or other
legal process or informal investigative demand issued in
connection with this Agreement or the Notes, or by reason of
being a holder of any Note, and (b) the costs and expenses,
including financial advisors' fees, incurred in connection with
the insolvency or bankruptcy of the Company or any Subsidiary or
in connection with any work-out or restructuring of the
transactions contemplated hereby and by the Notes. The Company
will pay, and will save any Purchaser and each other holder of a
Note harmless from, all claims in respect of any fees, costs or
expenses if any, of brokers and finders (other than those
retained by such Purchaser). The Company's obligations to pay
the fees of special counsel to the Purchasers in connection with
the negotiation, execution and delivery of this Agreement as
required by this Section 15.1 shall be deemed to have been fully
satisfied.
15.2. Survival.
The obligations of the Company under this Section 15
will survive the payment or transfer of any Note, the
enforcement, amendment or waiver of any provision of this
Agreement or the Notes, and the termination of this Agreement.
16. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT.
All representations and warranties contained herein
shall survive the execution and delivery of this Agreement and
the Notes, the purchase or transfer by any Purchaser of any Note
or portion thereof or interest therein and the payment of any
Note, and may be relied upon by any subsequent holder of a Note,
regardless of any investigation made at any time by or on behalf
of any Purchaser or any other holder of a Note. All statements
contained in any certificate or other instrument delivered by or
on behalf of the Company pursuant to this Agreement shall be
deemed representations and warranties of the Company under this
Agreement. Subject to the preceding sentence, this Agreement and
the Notes embody the entire agreement and understanding between
the Purchasers and the Company and supersede all prior agreements
and understandings relating to the subject matter hereof.
17. AMENDMENT AND WAIVER.
17.1. Requirements.
This Agreement and the Notes may be amended, and the
observance of any term hereof or of the Notes may be waived
(either retroactively or prospectively), with (and only with) the
written consent of the Company and the Required Holders, except
that (a) with the written consent of the holders of all Notes of
a particular Series, and if an Event of Default shall have
occurred and be continuing, of the holders of all Notes of all
Series, at the time outstanding (and not without such written
consents), the Notes of such Series may be amended, or the
provisions thereof waived, to change the maturity thereof, to
change or affect the principal thereof, or to change or affect
the rate or time of payment of interest on or any Make-Whole
Amount payable with respect to the Notes of such Series, (b)
without the written consent of the holder or holders of all Notes
at the time outstanding, no amendment to, or waiver of, the
provisions of this Agreement shall change or affect the
provisions of (i) Sections 8, 11(a), 11(b), 12, 17, or 20 insofar
as such provisions relate to proportions of the principal amount
of the Notes of any Series, or the rights of any individual
holder of Notes, required with respect to any declaration of
Notes to be due and payable or with respect to any consent,
amendment, waiver or declaration, or (ii) amend the definition of
"Change of Control" or any constituent definitions thereof,
(c) with the written consent of Prudential (and not without the
written consent of Prudential) the provisions of Section 2 may be
amended or waived (except insofar as any such amendment or waiver
would affect any rights or obligations with respect to the
purchase and sale of Notes which shall have become Accepted Notes
prior to such amendment or waiver), (d) with the written consent
of all of the Purchasers which shall have become obligated to
purchase Accepted Notes of any Series (and not without the
written consent of all such Purchasers), any of the provisions of
Sections 2, 3 and 4 may be amended or waived insofar as such
amendment or waiver would affect only rights or obligations with
respect to the purchase and sale of the Accepted Notes of such
Series or the terms and provisions of such Accepted Notes, and
(e) with the written consent of Prudential and Prudential
Affiliates only the provisions of Section 10.11 may be amended or
waived.
17.2. Solicitation of Holders of Notes.
(a) Solicitation. The Company will provide each
holder of the Notes (irrespective of the amount of Notes then
owned by it) with sufficient information, sufficiently far in
advance of the date a decision is required, to enable such holder
to make an informed and considered decision with respect to any
proposed amendment, waiver or consent in respect of any of the
provisions hereof or of the Notes. The Company will deliver
executed or true and correct copies of each amendment, waiver or
consent effected pursuant to the provisions of this Section 17 to
each holder of outstanding Notes promptly following the date on
which it is executed and delivered by, or receives the consent or
approval of, the requisite holders of Notes.
(b) Payment. The Company will not directly or
indirectly pay or cause to be paid any remuneration, whether by
way of supplemental or additional interest, fee or otherwise, or
grant any security, to any holder of Notes as consideration for
or as an inducement to the entering into by any holder of Notes
or any waiver or amendment of any of the terms and provisions
hereof unless such remuneration is concurrently paid, or security
is concurrently granted, on the same terms, ratably to each
holder of Notes then outstanding even if such holder did not
consent to such waiver or amendment.
17.3. Binding Effect, etc.
Any amendment or waiver consented to as provided in
this Section 17 applies equally to all holders of Notes and is
binding upon them and upon each future holder of any Note and
upon the Company without regard to whether such Note has been
marked to indicate such amendment or waiver. No such amendment
or waiver will extend to or affect any obligation, covenant,
agreement, Default or Event of Default not expressly amended or
waived or impair any right consequent thereon. No course of
dealing between the Company and the holder of any Note nor any
delay in exercising any rights hereunder or under any Note shall
operate as a waiver of any rights of any holder of such Note. As
used herein, the term "this Agreement" and references thereto
shall mean this Agreement as it may from time to time be amended
or supplemented.
17.4. Notes held by Company, etc.
Solely for the purpose of determining whether the
holders of the requisite percentage of the aggregate principal
amount of Notes then outstanding approved or consented to any
amendment, waiver or consent to be given under this Agreement or
the Notes, or have directed the taking of any action provided
herein or in the Notes to be taken upon the direction of the
holders of a specified percentage of the aggregate principal
amount of Notes then outstanding, Notes directly or indirectly
owned by the Company or any of its Affiliates shall be deemed not
to be outstanding.
18. NOTICES.
All notices and communications provided for hereunder
shall be in writing and sent (a) by telecopy if the sender on the
same day sends a confirming copy of such notice by a recognized
overnight delivery service (charges prepaid), or (b) by
registered or certified mail with return receipt requested
(postage prepaid), or (c) by a recognized overnight delivery
service (with charges prepaid). Any such notice must be sent:
(i) if to a Purchaser or its nominee, to it at the
address specified for such communications in Schedule A, or
at such other address as such Purchaser or it shall have
specified to the Company in writing,
(ii) if to any other holder of any Note, to such holder
at such address as such other holder shall have specified to
the Company in writing, or
(iii) if to the Company, to the Company at its
address set forth at the beginning hereof to the attention
of Chief Financial Officer, or at such other address as the
Company shall have specified to the holder of each Note in
writing.
Notices under this Section 18 will be deemed given only when
actually received.
19. REPRODUCTION OF DOCUMENTS.
This Agreement and all documents relating thereto,
including, without limitation, (a) consents, waivers and
modifications that may hereafter be executed, (b) documents
received by a Purchaser on any Closing Day (except the Notes
themselves), and (c) financial statements, certificates and other
information previously or hereafter furnished to any Purchaser,
may be reproduced by such Purchaser by any photographic,
photostatic, microfilm, microcard, miniature photographic or
other similar process and such Purchaser may destroy any
original document so reproduced. The Company agrees and
stipulates that, to the extent permitted by applicable law, any
such reproduction shall be admissible in evidence as the original
itself in any judicial or administrative proceeding (whether or
not the original is in existence and whether or not such
reproduction was made by a Purchaser in the regular course of
business) and any enlargement, facsimile or further reproduction
of such reproduction shall likewise be admissible in evidence.
This Section 19 shall not prohibit the Company or any other
holder of Notes from contesting any such reproduction to the same
extent that it could contest the original, or from introducing
evidence to demonstrate the inaccuracy of any such reproduction.
20. CONFIDENTIAL INFORMATION.
For the purposes of this Section 20, "Confidential
Information" means (1) information delivered to Prudential or
PICA prior to December 27, 1999 that was clearly marked or
labeled or otherwise adequately identified as being confidential
information when delivered, to the extent that it contains
information that is proprietary in nature, and (2) information
delivered on and after December 27, 1999 to Prudential or PICA,
or any holder of Notes by or on behalf of the Company or any
Subsidiary in connection with the transactions contemplated by or
otherwise pursuant to this Agreement that is proprietary in
nature and that was clearly marked or labeled or otherwise
adequately identified when received by Prudential or PICA, or any
holder of Notes as being confidential information of the Company
or such Subsidiary, provided that such term does not include
information that (a) was publicly known or otherwise known to
Prudential or PICA, or any holder of Notes prior to the time of
such disclosure, (b) subsequently becomes publicly known through
no act or omission by Prudential or PICA, or any holder of Notes,
or any person acting on its behalf, (c) otherwise becomes known
to Prudential or PICA, or any holder of Notes other than through
disclosure by the Company or any Subsidiary or (d) constitutes
financial statements delivered to Prudential or PICA, or any
holder of Notes under Section 7.1 that are otherwise publicly
available. Prudential, PICA and any holder of Notes will
maintain the confidentiality of such Confidential Information in
accordance with procedures adopted by Prudential or PICA, or such
holder of Notes, respectively, in good faith to protect
confidential information of third parties delivered to Prudential
or PICA, or such holder of Notes, provided that Prudential or
PICA, or any holder of Notes may deliver or disclose Confidential
Information to (i) its directors, officers, employees, agents,
attorneys and affiliates (to the extent such disclosure
reasonably relates to the administration of the investment
represented by its Notes), (ii) its financial advisors and other
professional advisors who agree to hold confidential the
Confidential Information substantially in accordance with the
terms of this Section 20, (iii) any other holder of any Note,
(iv) any Institutional Investor to which it sells or offer to
sell such Note or any part thereof or any participation therein
(if such Person has agreed in writing prior to its receipt of
such Confidential Information to be bound by the provisions of
this Section 20), (v) any Person from which it offers to purchase
any security of the Company (if such Person has agreed in writing
prior to its receipt of such Confidential Information to be bound
by the provisions of this Section 20), (vi) any federal or state
regulatory authority having jurisdiction over it, (vii) the
National Association of Insurance Commissioners or any similar
organization, or any nationally recognized rating agency that
requires access to information about its investment portfolio or
(viii) any other Person to which such delivery or disclosure may
be necessary or appropriate (w) to effect compliance with any
law, rule, regulation or order applicable to it, (x) in response
to any subpoena or other legal process, (y) in connection with
any litigation to which it is a party or (z) if an Event of
Default has occurred and is continuing, to the extent it may
reasonably determine such delivery and disclosure to be necessary
or appropriate in the enforcement or for the protection of the
rights and remedies under its Notes and this Agreement. Each
holder of a Note, by its acceptance of a Note, will be deemed to
have agreed to be bound by and to be entitled to the benefits of
this Section 20 as though it were a party to this Agreement. On
reasonable request by the Company in connection with the delivery
to any holder of a Note of information required to be delivered
to such holder under this Agreement or requested by such holder
(other than a holder that is a party to this Agreement or its
nominee), such holder will enter into an agreement with the
Company embodying the provisions of this Section 20.
21. SUBSTITUTION OF PURCHASER.
Each Purchaser shall have the right to substitute any
one of its Affiliates as the purchaser of the Notes that such
Purchaser has agreed to purchase hereunder, by written notice to
the Company, which notice shall be signed by both such Purchaser
and such Affiliate, shall contain such Affiliate's agreement to
be bound by this Agreement and shall contain a confirmation by
such Affiliate of the accuracy with respect to it of the
representations set forth in Section 6. Upon receipt of such
notice, wherever the word "Purchaser" (or a pronoun referring to
a Purchaser) is used in this Agreement (other than in this
Section 21), such word shall be deemed to refer to such Affiliate
in lieu of such Purchaser. In the event that such Affiliate is
so substituted as a purchaser hereunder and such Affiliate
thereafter transfers to such Purchaser all of the Notes then held
by such Affiliate, upon receipt by the Company of notice of such
transfer, wherever the word "Purchaser" (or a pronoun referring
to a Purchaser) is used in this Agreement (other than in this
Section 21), such word shall no longer be deemed to refer to such
Affiliate, but shall refer to such Purchaser, and such Purchaser
shall have all the rights of an original holder of the Notes
under this Agreement.
22. MISCELLANEOUS.
22.1. Successors and Assigns.
All covenants and other agreements contained in this
Agreement by or on behalf of either of the parties hereto bind
and inure to the benefit of their respective successors and
assigns (including, without limitation, any subsequent holder of
a Note) whether so expressed or not.
22.2. Payments Due on Non-Business Days.
Anything in this Agreement or the Notes to the contrary
notwithstanding, any payment of principal of or Make-Whole Amount
or interest on any Note that is due on a date other than a
Business Day shall be made on the next succeeding Business Day
without including the additional days elapsed in the computation
of the interest payable on such next succeeding Business Day.
22.3. Severability.
Any provision of this Agreement 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, and any such prohibition or unenforceability in any
jurisdiction shall (to the full extent permitted by law) not
invalidate or render unenforceable such provision in any other
jurisdiction.
22.4. Construction.
Each covenant contained herein shall be construed
(absent express provision to the contrary) as being independent
of each other covenant contained herein, so that compliance with
any one covenant shall not (absent such an express contrary
provision) be deemed to excuse compliance with any other
covenant. Where any provision herein refers to action to be
taken by any Person, or which such Person is prohibited from
taking, such provision shall be applicable whether such action is
taken directly or indirectly by such Person.
22.5. Counterparts.
This Agreement may be executed in any number of
counterparts, each of which shall be an original but all of which
together shall constitute one instrument. Each counterpart may
consist of two copies hereof, each signed by either, but together
signed by both, of the parties hereto.
22.6. Governing Law.
This Agreement shall be construed and enforced in
accordance with, and the rights of the parties shall be governed
by, the law of the State of New York excluding, to the extent
permitted by the law of such State, choice-of-law principles of
the law of such State that would require the application of the
laws of a jurisdiction other than such State.
23. CONDITIONS TO EFFECTIVENESS.
This Amended and Restated Master Shelf Agreement shall
be effective as of April 29, 2005 (the "Effective Date") if, on
or before April 29, 2005, the conditions set forth in this
Section 23 shall have been satisfied.
23.1. Secretary's Certificate.
The Company shall have delivered to Prudential a
certificate, dated as of the Effective Date, certifying as to the
resolutions attached thereto and other corporate proceedings
relating to the authorization, execution and delivery of this
Agreement.
23.2. Opinion of Counsel.
Prudential shall have received an opinion in form and
substance reasonably satisfactory to Prudential, dated the
Effective Date from ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, General Counsel of the
Company, covering such matters incident to the transactions
contemplated hereby as Prudential may reasonably request. The
Company hereby directs such counsel to deliver such opinion. The
Company has advised such counsel that Prudential and each holder
receiving such an opinion will rely on such opinion, as of the
date of such opinion.
* * * * *
If you are in agreement with the foregoing, please sign
the form of agreement on the accompanying counterpart of this
Agreement and return it to the Company, whereupon the foregoing
shall become a binding agreement between you and the Company.
Very truly yours,
CENTENNIAL ENERGY HOLDINGS, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Executive Vice President, Treasurer
and Chief Financial Officer
The foregoing is hereby agreed to as of the
date thereof.
PRUDENTIAL INVESTMENT MANAGEMENT, INC.
By: /s/▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Vice President
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA
By: /s/▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Vice President
PRUCO LIFE INSURANCE COMPANY
By: /s/▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Vice President
PRUCO LIFE INSURANCE COMPANY OF NEW JERSEY
By: /s/▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Vice President
GENERAL ELECTRIC CAPITAL ASSURANCE COMPANY
By: Prudential Private Placement Investors,
L.P. (as Investment Advisor)
By: Prudential Private Placement Investors, Inc.
(as its General Partner)
By: /s/▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Vice President
GENERAL ELECTRIC LIFE AND ANNUITY ASSURANCE COMPANY
By: Prudential Private Placement Investors,
L.P. (as Investment Advisor)
By: Prudential Private Placement Investors, Inc.
(as its General Partner)
By: /s/▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Vice President
FIRST COLONY LIFE INSURANCE COMPANY
By: Prudential Private Placement Investors,
L.P. (as Investment Advisor)
By: Prudential Private Placement Investors, Inc.
(as its General Partner)
By: /s/▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Vice President
HARTFORD LIFE INSURANCE COMPANY
By: Prudential Private Placement Investors,
L.P. (as Investment Advisor)
By: Prudential Private Placement Investors, Inc.
(as its General Partner)
By: /s/▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Vice President
SECURITY LIFE OF DENVER INSURANCE
COMPANY, as successor by merger to Southland
Life Insurance Company
By: Prudential Private Placement Investors,
L.P. (as Investment Advisor)
By: Prudential Private Placement Investors, Inc.
(as its General Partner)
By: /s/▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Vice President
ING USA ANNUITY AND LIFE INSURANCE COMPANY,
f/k/a Golden American Life Insurance Company
By: Prudential Private Placement Investors,
L.P. (as Investment Advisor)
By: Prudential Private Placement Investors, Inc.
(as its General Partner)
By: /s/▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Vice President
RELIASTAR LIFE INSURANCE COMPANY
By: Prudential Private Placement Investors,
L.P. (as Investment Advisor)
By: Prudential Private Placement Investors, Inc.
(as its General Partner)
By: /s/▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Vice President
ING LIFE INSURANCE AND ANNUITY COMPANY
By: Prudential Private Placement Investors,
L.P. (as Investment Advisor)
By: Prudential Private Placement Investors, Inc.
(as its General Partner)
By: /s/▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Vice President
UNITED OF OMAHA LIFE INSURANCE COMPANY
By: Prudential Private Placement Investors,
L.P. (as Investment Advisor)
By: Prudential Private Placement Investors, Inc.
(as its General Partner)
By: /s/▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Vice President
MUTUAL OF OMAHA INSURANCE COMPANY
By: Prudential Private Placement Investors,
L.P. (as Investment Advisor)
By: Prudential Private Placement Investors, Inc.
(as its General Partner)
By: /s/▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Vice President
SCHEDULE B
DEFINED TERMS
As used herein, the following terms have the respective
meanings set forth below or set forth in the Section hereof
following such term:
"Acceptable Broker-Dealer" means any Person other than
a natural person (i) which is registered as a broker or dealer
pursuant to the Exchange Act and (ii) whose long-term unsecured
debt obligations shall be rated "A" or better by S&P or "A2" or
better by ▇▇▇▇▇'▇.
"Acceptance" is defined in Section 2.6.
"Acceptance Day" is defined in Section 2.6.
"Acceptance Window" is defined in Section 2.6.
"Accepted Note" is defined in Section 2.6.
"Acquisition" means any transaction or series of
related transactions for the purpose of or resulting, directly or
indirectly, in (a) the acquisition of all or substantially all of
the assets of a Person, or of any business or division of a
Person, (b) the acquisition of 50% or more of the capital stock,
partnership interests, membership interests or equity of any
Person, or otherwise causing any Person to become a Subsidiary,
or (c) a merger or consolidation or any other combination with
another Person provided that the Company or any Subsidiary is the
surviving entity.
"Additional Reporting Subsidiary" is defined in Section 7.1(c).
"Affiliate" means, at any time, and with respect to any
Person, any other Person that at such time directly or indirectly
through one or more intermediaries Controls, or is Controlled by,
or is under common Control with, such first Person. As used in
this definition, "Control" means the possession, directly or
indirectly, of the power to direct or cause the direction of the
management and policies of a Person, whether through the
ownership of voting securities, by contract or otherwise. Unless
the context otherwise clearly requires, any reference to an
"Affiliate" is a reference to an Affiliate of the Company.
"Agreement" is defined in Section 17.3.
"Asset Sale" means (x) any conveyance, transfer, lease
or other disposition (including, without limitation, by means of
a Sale-Leaseback Transaction) (collectively, for purposes of this
definition, a "transfer"), directly or indirectly, in one or a
series of related transactions, of (a) any Capital Stock of any
Restricted Subsidiary (including, without limitation, the
issuance thereof by such Restricted Subsidiary to any Person
other than the Company or a Wholly-Owned Restricted Subsidiary);
(b) all or substantially all of the properties of any division or
line of business of the Company or any Subsidiary; (c) any other
properties of the Company or any Restricted Subsidiary (other
than, in the case of this clause (c), (i) transfers of cash or
cash equivalents, (ii) sales of inventory or oil and gas
production in the ordinary course of business, (iii) any transfer
of properties of any Restricted Subsidiary to the Company or a
Wholly-Owned Restricted Subsidiary, (iv) sales of damaged, worn-
out or obsolete equipment that, in the Company's reasonable
judgment, are either no longer used or no longer useful in the
business of the Company or its Restricted Subsidiaries, and (v)
transfer of Capital Stock of Unrestricted Subsidiaries; or (y)
the change of designation of a Restricted Subsidiary to an
Unrestricted Subsidiary; provided that a change of designation of
a Restricted Subsidiary (herein the "Subject Subsidiary") to an
Unrestricted Subsidiary on any date ("Change Date") shall not
constitute an Asset Sale if, in the event that the Subject
Subsidiary had been an Unrestricted Subsidiary during the period
of four fiscal quarters most recently ended, the Company would
have been in compliance with Sections 10.1, 10.2 and 10.3
immediately prior to the proposed Change Date for the Subject
Subsidiary.
"Authorized Officer" shall mean (i) in the case of the
Company, any officer of the Company designated as an "Authorized
Officer" of the Company in the Information Schedule attached
hereto or any vice president of the Company designated as an
"Authorized Officer" of the Company for the purpose of this
Agreement in an Officer's Certificate executed by the Company's
chief executive officer or chief financial officer and delivered
to Prudential, and (ii) in the case of Prudential, any officer of
Prudential designated as its "Authorized Officer" in the
Information Schedule or any officer of Prudential designated as
its "Authorized Officer" for the purpose of this Agreement in a
certificate executed by one of its Authorized Officers. Any
action taken under this Agreement on behalf of the Company by any
individual who on or after December 27, 1999 shall have been an
Authorized Officer of the Company and whom Prudential in good
faith believes to be an Authorized Officer of the Company at the
time of such action shall be binding on the Company even though
such individual shall have ceased to be an Authorized Officer of
the Company, and any action taken under this Agreement on behalf
of Prudential by any individual who on or after December 27, 1999
shall have been an Authorized Officer of Prudential and whom the
Company in good faith believes to be an Authorized Officer of
Prudential at the time of such action shall be binding on
Prudential even though such individual shall have ceased to be an
Authorized Officer of Prudential.
"Available Facility Amount" is defined in Section 2.1.
"Business Day" means (a) any day other than a Saturday,
a Sunday or a day on which commercial banks in New York City are
required or authorized to be closed, and (b) for the purposes of
Section 2.3 only a day on which Prudential is open for business.
"Called Principal" is defined in Section 8.6.
"Cancellation Date" is defined in Section 2.8(c).
"Cancellation Fee" is defined in Section 2.8(c).
"Capital Lease" means, at any time, a lease with
respect to which the lessee is required concurrently to recognize
the acquisition of an asset and the incurrence of a liability in
accordance with GAAP.
"Capitalization Ratio" means, with respect to any
Person, the ratio of such Person's Total Debt to such Person's
Total Capitalization.
"Capital Stock" of any Person means any and all shares,
interests, participations or other equivalents in the equity
interest (however designated) in such Person and any rights
(other than debt securities convertible into an equity interest),
warrants or options to acquire an equity interest in such Person.
"Centennial Exposure" means, at any time, the aggregate
principal amount of (i) Notes outstanding at such time held by
Prudential Financial Entities (other than Notes held for separate
accounts), (ii) Accepted Notes which Prudential Financial
Entities have agreed to purchase but which have not been
purchased at such time (other than Accepted Notes to be purchased
for separate accounts) and (iii) Other Company Notes outstanding
at such time held by Prudential Financial Entities (other than
Other Company Notes held for separate accounts).
"Change of Control" means the occurrence of any event
whereby MDU Resources Group, Inc. ceases to own direct or
indirect sole beneficial ownership (as defined under Regulation
13d-3 of the Exchange Act as in effect on the Effective Date) of
at least 51% of (x) the combined voting power of the Company's
securities which are entitled to vote generally in the election
of directors of the Company and (y) each other class of equity
securities of the Company.
"Closing Day" for any Accepted Note shall mean the
Business Day specified for the closing of the purchase and sale
of such Note in the Request for Purchase of such Note, provided
that (i) if the Acceptance Day for such Accepted Note is less
than five Business Days after the Company shall have made such
Request for Purchase and the Company and the Purchaser which is
obligated to purchase such Note agree on an earlier Business Day
for such closing, the "Closing Day" for such Accepted Note shall
be such earlier Business Day, and (ii) if the closing of the
purchase and sale of such Accepted Note is rescheduled pursuant
to Section 3.3, the Closing Day for such Accepted Note, for all
purposes of this Agreement except Section 2.8(c), shall mean the
Rescheduled Closing Day with respect to such Closing.
"Code" means the Internal Revenue Code of 1986, as
amended from time to time, and the final rules and regulations
promulgated thereunder from time to time.
"Company" means Centennial Energy Holdings, Inc., a
Delaware corporation, until a Person becomes a successor in a
transaction permitted by Section 10.7, and thereafter shall mean
any such successor Person.
"Confidential Information" is defined in Section 20.
"Confirmation of Acceptance" is defined in Section 2.6.
"Consolidated Net Income" means, for any period,
consolidated net income (or net loss) of the Company and its
Restricted Subsidiaries for such period as determined in
accordance with GAAP computed for the purposes of this definition
without giving effect to extraordinary losses or extraordinary
gains for such period.
"Consolidated Net Worth" means, at any time, the excess
of total assets of the Company and its Restricted Subsidiaries
over total liabilities of the Company and its Restricted
Subsidiaries as of the last day of the fiscal quarter most
recently then ended, determined on a consolidated basis in
accordance with GAAP.
"Consolidated Total Assets" means, as of any time, the
total amount of assets which would appear on a consolidated
balance sheet of the Company at such time prepared in accordance
with GAAP, less all assets of Unrestricted Subsidiaries.
"Default" means an event or condition the occurrence or
existence of which would, with the lapse of time or the giving of
notice or both, become an Event of Default.
"Default Rate" means, with respect to the Notes of a
Series, that rate of interest that is the greater (determined on
a daily basis) of (i) 2.0% per annum over the stated rate of
interest on the Notes of such Series or (ii) 2.0% over the rate
of interest publicly announced by The Bank of New York in New
York, New York as its "base" or "prime" rate.
"Delayed Delivery Fee" is defined in Section 2.8(b).
"Designated Spread" is defined in Section 8.6.
"Discounted Value" is defined in Section 8.6.
"EBITDA" means, for any period, the sum of (a)
Consolidated Net Income for such period plus (b) all amounts
treated as expenses for depreciation (including any non-cash
charge relating to asset impairment determined in accordance with
GAAP) and interest and the amortization of intangibles of any
kind for such period to the extent included in the determination
of Consolidated Net Income plus (c) all taxes accrued for such
period on or measured by income to the extent included in the
determination of Consolidated Net Income; provided that
Consolidated Net Income shall be computed for purposes of this
definition without giving effect to extraordinary losses or
extraordinary gains for such period; and provided, further that,
the term "EBITDA," when used in Section 10.8(f) with respect to
the Unrestricted Subsidiaries of the Company, shall mean, for any
period, EBITDA determined solely with respect to the consolidated
financial results of the Unrestricted Subsidiaries in lieu of the
consolidated financial results of the Company and the Restricted
Subsidiaries, with such corresponding modifications to the
definition of Consolidated Net Income as are applicable to effect
such determination; and provided, further that, the term
"EBITDA", when used in Section 10.8 (f) with respect to the
Company and its Subsidiaries, shall mean, for any period, the
EBITDA of the Company and all of its Subsidiaries, Restricted and
Unrestricted, with such corresponding modifications to the
definition of Consolidated Net Income as are applicable to effect
such determination.
"Effective Date" is defined in Section 23.
"Environmental Laws" means all Federal, state, local
and foreign statutes, laws, regulations, ordinances, rules,
judgments, orders, consent decrees, permits, concessions, grants,
franchises, licenses, agreements or governmental restrictions
relating to the regulation or protection of human health, safety
or the environment or to emissions, discharges, releases or
threatened releases of Hazardous Materials into the environment,
including, without limitation, ambient air, soil, surface water,
groundwater, wetlands, land or subsurface strata or otherwise
relating to the manufacture, processing, distribution, use,
treatment, storage, disposal, transport or handling of Hazardous
Materials. Without limiting the foregoing, Environmental Laws
shall include, but not be limited to, the Comprehensive
Environmental Response, Compensation and Liability Act, 42 U.S.C.
9601 et seq., the Solid Waste Disposal Act, 42 U.S.C. Section 6901 et
seq., the Federal Water Pollution Control Act, 33 U.S.C. Section 1251 et
seq., the Clear Air Act, 42 U.S.C. 7401 et seq., the Toxic
Substances Control Act, 15 U.S.C. 2601 et seq., the Emergency
Planning and Community Right-to-Know Act, 42 U.S.C. Section 11001 et
seq., the Natural Gas Pipeline Safety Act, 49 App. U.S.C. Section 1671
et seq., the Hazardous Liquid Pipeline Safety Act, 49 App. U.S.C.
1811 et seq., the Occupational Safety and Health Act, 29 U.S.C.
651 et seq., the Hazardous Materials Transportation Act, 49
U.S.C. 1801 et seq., in each case as amended from time to time,
and any analogous foreign, state and local laws, and any rules or
regulations from time to time promulgated thereunder.
"ERISA" means the Employee Retirement Income Security
Act of 1974, as amended from time to time, and the final rules
and regulations promulgated thereunder from time to time in
effect.
"ERISA Affiliate" means any trade or business (whether
or not incorporated) that is treated as a single employer
together with the Company under Section 414 of the Code.
"ERISA Event" means (a) a Reportable Event with respect
to a Pension Plan or a Multiemployer Plan; (b) a withdrawal by
the Company or any ERISA Affiliate from a Pension Plan subject to
Section 4063 of ERISA during a plan year in which it was a
substantial employer (as defined in Section 4001(a)(2) of ERISA)
or a cessation of operations which is treated as such a
withdrawal under Section 4062(e) of ERISA; (c) a complete or
partial withdrawal by the Company or any ERISA Affiliate from a
Multiemployer Plan or notification that a Multiemployer Plan is
in reorganization; (d) the commencement of proceedings by the
PBGC to terminate a Pension Plan or Multiemployer Plan; (e) a
failure by the Company or an ERISA Affiliate to make required
contributions to a Pension Plan, Multiemployer Plan or other Plan
subject to Section 412 of the Code; (f) an event or condition
which might reasonably be expected to constitute grounds under
Section 4042 of ERISA for the termination of, or the appointment
of a trustee to administer, any Pension Plan or Multiemployer
Plan; (g) the imposition of any liability under Title IV of
ERISA, other than PBGC premiums due but not delinquent under
Section 4007 of ERISA, upon the Company or any ERISA Affiliate or
(h) an application for a funding waiver or an extension of any
amortization period pursuant to Section 412 of the Code with
respect to any Plan.
"ERISA Termination Event" means the filing of a notice
of intent to terminate, or the treatment of a Plan amendment as a
termination under Section 4041 or 4041A of ERISA of, a Pension
Plan or Multiemployer Plan.
"Event of Default" is defined in Section 11.
"Excess Proceeds Amount" means, at any time, the
greater of (i) the excess, if any, of (A) the Gross Proceeds
Amounts of all Asset Sales during the then current fiscal year
over (B) 10% of Consolidated Total Assets as of the end of the
prior fiscal year or (ii) the Gross Proceeds Amounts of all
Assets Sales during the then current fiscal year multiplied by a
fraction (x) the numerator of which is the excess, if any, of (A)
the percentage of EBITDA attributable to the property and assets
subject to such Asset Sales over (B) 15% of EBITDA for any of the
three preceding fiscal years (beginning with the 1996 fiscal
year) and (y) the denominator of which is the percentage of
EBITDA for any of such three fiscal years attributable to the
property and assets subject to such Asset Sales. In making any
calculation pursuant to subclause (x) of clause (ii) of the
preceding sentence, the fiscal year which results in the greatest
excess shall be utilized, and the same such fiscal year shall be
utilized for purposes of subclause (y) of said clause (ii).
"Exchange Act" means the Securities Exchange Act of
1934, as amended.
"Facility Fee" is defined in Section 2.8(a).
"Fair Market Value" means, at any time with respect to
any property of any kind or character, the sale value of such
property that would be realized in an arm's-length sale at such
time between an informed and willing buyer and an informed and
willing seller, under no compulsion to buy or sell, respectively.
"Financial Contract" means any agreement, device or
arrangement providing for payments related to fluctuations of
interest rates, including, but not limited to, interest rate swap
or exchange agreements, interest rate cap or collar protection
agreements and interest rate options.
"FRB" means the Board of Governors of the Federal
Reserve System, and any Governmental Authority succeeding to any
of its principal functions.
"GAAP" means generally accepted accounting principles
set forth from time to time in the opinions and pronouncements of
the Accounting Principles Board and the American Institute of
Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board (or agencies with
similar functions of comparable stature and authority within the
U.S. accounting profession), which are applicable to the
circumstances as of August 18, 2004. The term "consistently
applied," as used in connection therewith, means that the
accounting principles applied are consistent in all material
respects with those applied at prior dates or for prior periods.
All references herein to "the Company and the Restricted
Subsidiaries" for the purposes of computing the consolidated
financial position, results of operations or other balance sheet
or financial statement items (including without limitation the
computation of Consolidated Net Worth, EBITDA, Interest Expense,
Consolidated Net Income, Consolidated Total Assets, Total Debt
and Total Capitalization) shall be deemed to include only the
Company and the Restricted Subsidiaries as separate legal
entities and, unless otherwise provided herein, shall not include
the financial position, results of operations, cash flows or
other such items of any other Person (including without
limitation an Unrestricted Subsidiary), whether or not, in any
particular instance, such accounting treatment would be in
accordance with generally accepted accounting principles.
"Governmental Authority" means any nation or
government, any state or other political subdivision thereof, any
central bank (or similar monetary or regulatory authority)
thereof, any entity exercising executive, legislative, judicial,
regulatory or administrative functions of or pertaining to
government, and any corporation or other entity owned or
controlled, through stock or capital ownership or otherwise, by
any of the foregoing.
"Gross Proceeds Amount" means, with respect to any
Asset Sale, the aggregate amount of the proceeds received from
such Asset Sale. For purposes of any calculation pursuant to
clause (1)(a) or (2) of Section 10.6 or clause (i) of the
definition of "Excess Proceeds Amount", such proceeds shall be
deemed to equal the Fair Market Value of the property and assets
subject to the Asset Sales with respect to which such calculation
is being made, determined in good faith at the time of such Asset
Sales by a Senior Financial Officer.
"Guaranty" means, with respect to any Person, any
obligation (except the endorsement in the ordinary course of
business of negotiable instruments for deposit or collection) of
such Person guaranteeing or in effect guaranteeing any
indebtedness, dividend or other obligation of any other Person in
any manner, whether directly or indirectly, including (without
limitation) obligations incurred through an agreement, contingent
or otherwise, by such Person:
(a) to purchase such indebtedness or obligation or any
property constituting security therefor;
(b) to advance or supply funds (i) for the purchase or
payment of such indebtedness or obligation, or (ii) to
maintain any working capital or other balance sheet
condition or any income statement condition of any other
Person or otherwise to advance or make available funds for
the purchase or payment of such indebtedness or obligation;
(c) to lease properties or to purchase properties or
services primarily for the purpose of assuring the owner of
such indebtedness or obligation of the ability of any other
Person to make payment of the indebtedness or obligation; or
(d) otherwise to assure the owner of such indebtedness
or obligation against loss in respect thereof.
In any computation of the indebtedness or other liabilities of
the obligor under any Guaranty, the indebtedness or other
obligations that are the subject of such Guaranty shall be
assumed to be direct obligations of such obligor.
"Hazardous Material" means any and all pollutants,
toxic or hazardous wastes or any other substances that might pose
a hazard to health or safety, the removal of which may be
required or the generation, manufacture, refining, production,
processing, treatment, storage, handling, transportation,
transfer, use, disposal, release, discharge, spillage, seepage,
or filtration of which is or shall be restricted, prohibited or
penalized by any applicable law (including, without limitation,
asbestos, urea formaldehyde foam insulation and polychlorinated
biphenyls).
"Hedge Treasury Note(s)" shall mean, with respect to
any Accepted Note, the United States Treasury Note or Notes whose
duration (as determined by Prudential) most closely matches the
duration of such Accepted Note.
"holder" means, with respect to any Note, the Person in
whose name such Note is registered in the register maintained by
the Company pursuant to Section 13.1.
"Hostile Tender Offer" shall mean, with respect to the
use of proceeds of any Note, any offer to purchase, or any
purchase of, shares of capital stock of any corporation or equity
interests in any other entity, or securities convertible into or
representing the beneficial ownership of, or rights to acquire,
any such shares or equity interests, if such shares, equity
interests, securities or rights are of a class which is publicly
traded on any securities exchange or in any over-the-counter
market, other than purchases of such shares, equity interests,
securities or rights representing less than 5% of the equity
interests or beneficial ownership of such corporation or other
entity for portfolio investment purposes, and such offer or
purchase has not been duly approved by the board of directors of
such corporation or the equivalent governing body of such other
entity prior to the date on which the Company makes the Request
for Purchase of such Note.
"Indebtedness" with respect to any Person means, at any
time, without duplication,
(a) its liabilities for borrowed money and its
redemption obligations in respect of mandatorily Redeemable
Preferred Stock;
(b) its liabilities for the deferred purchase price of
property acquired by such Person (excluding accounts payable
arising in the ordinary course of business but including all
liabilities created or arising under any conditional sale or
other title retention agreement with respect to any such
property);
(c) all liabilities appearing on its balance sheet in
accordance with GAAP in respect of Capital Leases;
(d) all liabilities for borrowed money secured by any
Lien with respect to any property owned by such Person,
whether or not it has assumed or otherwise become liable for
such liabilities (other than Indebtedness of others secured
by Liens, neither assumed nor guaranteed by the Company or
any Subsidiary nor with respect to which the Company or any
Subsidiary pays principal and/or interest, existing upon
real estate or rights in or relating to real estate acquired
by the Company or any Subsidiary for substation, metering
station, gathering line, transmission line, transportation
line, distribution line or right of way purposes to the
extent such Lien does not, or the foreclosure thereof could
not, materially impair the value of such property or the use
of such property for the purpose for which it was acquired
by the Company or such Subsidiary);
(e) all its liabilities in respect of letters of
credit or instruments serving a similar function issued or
accepted for its account by banks and other financial
institutions (whether or not representing obligations for
borrowed money);
(f) Swaps of such Person (excluding commodity swaps in
the ordinary course of business (and for which such Person
has production or products covered by such commodity swaps
in sufficient volume to deliver under such commodity swaps)
and non-speculative interest rate swaps);
(g) all Securitization Obligations of such Person;
(h) any Guaranty of such Person with respect to
liabilities of a type described in any of clauses (a)
through (g) hereof; and
(i) Preferred Stock of any Restricted Subsidiary held
by a Person other than the Company or a Wholly-Owned
Restricted Subsidiary.
Indebtedness of any Person shall include all obligations of such
Person of the character described in clauses (a) through (h) to
the extent such Person remains legally liable in respect thereof
notwithstanding that any such obligation is deemed to be
extinguished under GAAP.
"Institutional Investor" means any bank, trust company,
savings and loan association or other financial institution, any
insurance company, investment company, broker or dealer, pension
plan, mutual fund or other similar financial institution,
including, without limiting the foregoing, any "qualified
institutional buyer" within the meaning of Rule 144A under the
Securities Act, which is or becomes a holder of any Note and any
Prudential Affiliate.
"Interest Expense" means, for any period, the sum of
(a) gross consolidated interest expense of the Company and its
Restricted Subsidiaries determined in conformity with GAAP plus
(b) to the extent not otherwise included in the determination of
gross consolidated interest expense of the Company and its
Restricted Subsidiaries in accordance with GAAP, the cost to the
Company of, and the net amount payable (or minus the net amount
receivable) under, all Financial Contracts of the Company and its
Subsidiaries during such period (whether or not actually paid or
received during such period) plus (c) all dividends paid,
declared or otherwise accrued in respect of preferred stock of
the Company and any Restricted Subsidiary that is not a Wholly-
Owned Restricted Subsidiary plus the consolidated yield or
discount accrued during such period on all Securitization
Obligations.
"Investment Policy" is defined in Section 10.8.
"Issuance Period" is defined in Section 2.2.
"Knife River Notes" means each of the following notes
of Knife River Corporation: the 7.10% Series B Senior Notes Due
October 30, 2009, the 7.28% Series C Senior Notes Due October 30,
2012, the 6.43% Series D Senior Notes Due October 30, 2005, the
6.68% Series E Senior Notes Due October 30, 2006, the 6.73%
Series F Senior Notes Due October 30, 2010, the 6.87% Series G
Senior Notes Due October 30, 2013 and the 7.05% Series H Senior
Notes Due October 30, 2018.
"Lien" means, with respect to any Person, any mortgage,
lien, pledge, charge, security interest or other encumbrance, or
any interest or title of any vendor, lessor, lender or other
secured party to or of such Person under any conditional sale or
other title retention agreement or Capital Lease, upon or with
respect to any property or asset of such Person (including in the
case of stock, stockholder agreements, voting trust agreements
and all similar arrangements).
"Loan Documents" means this Agreement, the Notes and
any and all Subsidiary Guarantees and the other documents and
agreements contemplated hereby and executed by the Company in
favor of Prudential or any holder of Notes.
"Make-Whole Amount" is defined in Section 8.6.
"Margin Stock" means "margin stock" as such term is
defined in Regulation T, U or X of the FRB.
"Material" means material in relation to the business,
operations, affairs, financial condition, assets or properties of
the Company and its Restricted Subsidiaries taken as a whole.
"Material Adverse Effect" means a material adverse
effect on (i) the business, property, condition (financial or
otherwise), results of operations of the Company and its
Restricted Subsidiaries taken as a whole, (ii) the ability of the
Company to perform its obligations under the Loan Documents, or
(iii) the validity or enforceability of any of the Loan Documents
or the rights or remedies of Prudential or the holders of Notes
thereunder.
"MDU Annual Report" means the Annual Report on Form 10-
K of MDU Resources Group, Inc. most recently filed with the SEC.
"Montana-Dakota" is defined in Section 10.9.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc.
"Multiemployer Plan" means a "multiemployer plan"
(within the meaning of Section 4001(a)(3) of ERISA) to which the
Company or any ERISA Affiliate makes, is making, or is obligated
to make contributions or, during the preceding three calendar
years, has made, or been obligated to make, contributions.
"Notes" is defined in Section 1.
"Obligations" means all unpaid principal of and accrued
and unpaid interest on the Notes, all accrued and unpaid fees and
all expenses, reimbursements, indemnities and other obligations
of the Company to the holders of the Notes or any indemnified
party hereunder arising under the Loan Documents.
"Officer's Certificate" means a certificate of a Senior
Financial Officer, an Authorized Officer or of any other officer
of the Company whose responsibilities extend to the subject
matter of such certificate.
"Organization Documents" means, for any corporation,
the certificate or articles of incorporation, the bylaws, any
certificate of determination or instrument relating to the rights
of preferred shareholders of such corporation, any shareholder
rights agreement, and all applicable resolutions of the board of
directors (or any committee thereof) of such corporation.
"Other Company Notes" means (i) the 6.43% Senior Notes
due October 30, 2005 of the Company, the 7.09% Senior Notes due
March 29, 2011 of the Company, the 3.80% Senior Notes due June
27, 2008 of the Company, (ii) any other promissory notes of the
Company issued pursuant to agreements, indentures or other
instruments (other than this Agreement) and (iii) any other
promissory notes of any Subsidiary of the Company (other than
Williston Basin). As of December 15, 2004, $13,100,000 of Other
Company Notes were part of the Centennial Exposure.
"PBGC" means the Pension Benefit Guaranty Corporation,
or any Governmental Authority succeeding to any of its principal
functions under ERISA.
"Pension Plan" means a pension plan (as defined in
Section 3(2) of ERISA) subject to Title IV of ERISA which the
Company or any ERISA Affiliate sponsors, maintains, or to which
it makes, is making, or is obligated to make contributions, or in
the case of a multiple employer plan (as described in Section
4064(a) of ERISA) has made contributions at any time during the
immediately preceding five plan years but excluding any
Multiemployer Plan.
"Permitted Liens" is defined in Section 10.4.
"Person" means an individual, partnership, corporation,
limited liability company, association, trust, unincorporated
organization, or a government or agency or political subdivision
thereof.
"PICA" shall mean The Prudential Insurance Company of
America, a New Jersey corporation.
"Plan" means an "employee benefit plan" (as defined in
section 3(3) of ERISA) that is or, within the preceding five
years, has been established or maintained, or to which
contributions are or, within the preceding five years, have been
made or required to be made, by the Company or any ERISA
Affiliate or with respect to which the Company or any ERISA
Affiliate may have any liability.
"Preferred Stock" means any class of capital stock of a
corporation that is preferred over any other class of capital
stock of such corporation as to the payment of dividends or the
payment of any amount upon liquidation or dissolution of such
corporation.
"Principal Operating Subsidiaries" means each of (i)
WBI Holdings, Inc., (ii) Fidelity Exploration & Production
Company, and (iii) Knife River Corporation, and their respective
permitted successors.
"Priority Debt" means (without duplication) the
aggregate of all Indebtedness of Restricted Subsidiaries of the
Company (other than redemption obligations in respect of
mandatory Redeemable Preferred Stock held by the Company or
Wholly-Owned Restricted Subsidiaries) plus all Preferred Stock of
Restricted Subsidiaries held by Persons other than the Company or
Wholly-Owned Restricted Subsidiaries plus all Indebtedness and
judgments secured by Liens other than Liens permitted by clauses
(a) through (j), inclusive, of Section 10.4.; provided, however,
that Priority Debt shall not include (X) Indebtedness represented
by Subsidiary Guarantees or guarantees of Restricted Subsidiaries
issued to third parties which are parties to an intercreditor
agreement contemplated by clause (ii) of Section 10.12 or
(Y) Indebtedness of Restricted Subsidiaries of the Company
represented by intercompany loans, advances and extensions of
credit made by the Company or any Wholly-Owned Restricted
Subsidiary to such Restricted Subsidiaries.
"property" or "properties" means, unless otherwise
specifically limited, real or personal property of any kind,
tangible or intangible, ▇▇▇▇▇▇ or inchoate.
"Property Reinvestment Application" means the
application of an amount equal to the Excess Proceeds Amount to
the acquisition by the Company or any Restricted Subsidiary, as
the case may be, of assets (i) similar to those disposed of by
such Person, or (ii) of a type used in the business of the
Company as of the Effective Date or another business that is
substantially similar thereto. For clarification, an exchange of
property on which recognition of gain or loss would be exempted
from recognition pursuant to Section 1031 of the Code shall
constitute an Asset Sale and a Property Reinvestment Application.
"Prudential" means Prudential Investment Management,
Inc., a New Jersey corporation.
"Prudential Affiliate" means (i) any corporation or
other entity controlling, controlled by, or under common control
with, Prudential and (ii) any managed account or investment fund
which is managed by Prudential or a Prudential Affiliate
described in clause (i) of this definition. For purposes of this
definition the terms "control", "controlling" and "controlled"
shall mean the ownership, directly or through subsidiaries, of a
majority of a corporation's or other entity's voting stock or
equivalent voting securities or interests.
"Prudential Financial Entity" shall mean (i) PICA,
Pruco Life Insurance Company, Pruco Life Insurance Company of New
Jersey and any other corporation or other entity controlling,
controlled by, or under common control with, PICA. For purposes
of this definition the terms "control", "controlling" and
"controlled" shall mean the ownership, directly or through
subsidiaries, of a majority of a corporation's or other entity's
voting stock or equivalent voting securities or interests.
"Purchasers" means, with respect to any Accepted Notes,
the Persons, either PICA or a Prudential Affiliate, who is
purchasing such Accepted Notes.
"QPAM Exemption" means Prohibited Transaction Class
Exemption 84-14 issued by the United States Department of Labor.
"Redeemable Preferred Stock" of any Person means any
equity interest of such Person that by its terms (or by the terms
of any equity interest into which it is convertible or for which
it is exchangeable), or otherwise (including on the happening of
an event), is required to be redeemed for cash or other property
or is redeemable for cash or other property at the option of the
holder thereof, in whole or in part, on or prior to the maturity
date of any Note; or is exchangeable for Indebtedness at any
time, in whole or in part, on or prior to the maturity date of
any Note; provided, however, that Redeemable Preferred Stock
shall not include any equity interest by virtue of the fact that
it may be exchanged or converted at the option of the holder or
of the Company for equity interests of the Company having no
preference as to dividends, distributions or liquidation over any
other equity interests of the Company.
"Reinvestment Yield" is defined in Section 8.6.
"Remaining Average Life" is defined in Section 8.6.
"Remaining Scheduled Payments" is defined in Section 8.6.
"Reportable Event" means any of the events set forth in
Section 4043(b) or 4043(c) of ERISA or the regulations
thereunder, other than any such event for which the 30-day notice
requirement under ERISA has been waived in regulations issued by
the PBGC.
"Request for Purchase" is defined in Section 2.4.
"Required Holders" means, with respect to the Notes, at
any time, the holders of at least 51% in principal amount of the
Notes at the time outstanding (exclusive of Notes then owned by
the Company or any of its Affiliates).
"Requirement of Law" means, as to any Person, any law
(statutory or common), treaty, rule or regulation or
determination of an arbitrator or of a Governmental Authority, in
each case applicable to or binding upon the Person or any of its
property or to which the Person or any of its property is
subject.
"Rescheduled Closing Day" is defined in Section 3.2.
"Restricted Subsidiary" shall mean any Subsidiary (i)
which is a Subsidiary of the Company on December 27, 1999 or
which the Company has designated a Restricted Subsidiary by
notice in writing given to the holders of the Notes and (ii)
which the Company has not thereafter designated as an
Unrestricted Subsidiary; provided, however, a Subsidiary may not
be designated as a Restricted Subsidiary if (a) it had previously
been designated as a Restricted Subsidiary and had thereafter
been designated as an Unrestricted Subsidiary within the
preceding 365 days; (b) any of the representations and warranties
applicable to such Subsidiary and contained in Section 5 would be
false if all such representations and warranties were to be
remade and restated immediately following such designation; or
(c) such designation shall result in any Default or Event of
Default; provided, further, that a Subsidiary may not be
designated as an Unrestricted Subsidiary if (a) it had previously
been designated as an Unrestricted Subsidiary and had thereafter
been designated as a Restricted Subsidiary within the preceding
365 days; (b) any of the representations and warranties
applicable to such Subsidiary and contained in Section 5 would be
false if all such representations and warranties were to be
remade and restated immediately following such designation; or
(c) such designation shall result in any Default or Event of
Default. If the Company forms or acquires a new Subsidiary, such
Subsidiary will be a Restricted Subsidiary absent a designation
as an Unrestricted Subsidiary. Notwithstanding the foregoing,
Williston Basin may not be designated as a Restricted Subsidiary
so long as any Williston Basin Notes are outstanding; provided,
that the Company may designate Williston Basin as a Restricted
Subsidiary immediately after the Williston Basin Notes are repaid
in full without regard to the 365-day period specified above.
"S&P" means Standard & Poor's Ratings Group, a division
of McGraw Hill, Inc.
"Sale-Leaseback Transaction" means, with respect to any
Person, any direct or indirect arrangement pursuant to which
properties are sold or transferred by such Person or a Subsidiary
of such Person and are thereafter leased back from the purchaser
or transferee thereof by such Person or one of its Subsidiaries.
"SEC" means the Securities and Exchange Commission, or
any Governmental Authority succeeding to any of its principal
functions.
"Securities Act" means the Securities Act of 1933, as
amended from time to time.
"Securitization Obligations" means, with respect to any
Securitization Transaction, the aggregate investment or claim
held at any time by all purchasers, assignees or transferees of
(or of interests in) or holders of obligations that are supported
or secured by accounts receivable, lease receivables and other
rights to payment in connection with such Securitization
Transaction.
"Securitization Transaction" means any sale, assignment
or other transfer by the Company or any Restricted Subsidiary of
accounts receivable, lease receivables or other payment
obligations owing to the Company or such Subsidiary or any
interest in any of the foregoing, together in each case with any
collections and other proceeds thereof, any collection or deposit
accounts related thereto, and any collateral, guaranties or other
property or claims in favor of the Company or such Subsidiary
supporting or securing payment by the obligor thereon of, or
otherwise related to, any such receivables.
"Security" has the meaning set forth in Section 2(1) of
the Securities Act.
"Senior Financial Officer" means the President, the
Financial Vice President, the Treasurer, Chief Financial Officer
or the Controller of the Company.
"Series" is defined in Section 1.
"Settlement Agreement" is defined in Section 10.9.
"Settlement Date" is defined in Section 8.6.
"Significant Subsidiary" means at any time any
Subsidiary or group of Subsidiaries the assets of which at such
time constitute 10% or more of Consolidated Total Assets at such
time or the net income of which constituted 10% or more of
Consolidated Net Income for the preceding fiscal year.
"Source" is defined in Section 6.2.
"Structuring Fee" is defined in Section 2.8(d).
"Subsidiary" means, as to any Person, any corporation,
association, limited liability company or other business entity
in which such Person or one or more of its Subsidiaries or such
Person and one or more of its Subsidiaries owns sufficient equity
or voting interests to enable it or them (as a group) ordinarily,
in the absence of contingencies, to elect a majority of the
directors (or Persons performing similar functions) of such
entity, and any partnership or joint venture if more than a 50%
interest in the profits or capital thereof is owned by such
Person or one or more of its Subsidiaries or such Person and one
or more of its Subsidiaries (unless such partnership can and does
ordinarily take major business actions without the prior approval
of such Person or one or more of its Subsidiaries). Unless the
context otherwise clearly requires, any reference to a
"Subsidiary" is a reference to a Subsidiary of the Company.
"Subsidiary Guarantees" means the guaranty agreement of
a Subsidiary in form and substance satisfactory to the Required
Holders.
"Swap Contract" means swap agreements (as such term is
defined in Section 101(53B) of the Bankruptcy Code) and any other
agreements or arrangements designed to provide protection against
fluctuations in interest or currency exchange rates or commodity
prices, including, but not limited to, Commodity Contracts and
Financial Contracts.
"Swaps" means, with respect to any Person, payment
obligations with respect to interest rate swaps, currency swaps
and similar obligations obligating such Person to make payments,
whether periodically or upon the happening of a contingency. For
the purposes of this Agreement, the amount of the obligation
under any Swap shall be the amount determined in respect thereof
as of the end of the then most recently ended fiscal quarter of
such Person, based on the assumption that such Swap had
terminated at the end of such fiscal quarter, and in making such
determination, if any agreement relating to such Swap provides
for the netting of amounts payable by and to such Person
thereunder or if any such agreement provides for the simultaneous
payment of amounts by and to such Person, then in each such case,
the amount of such obligation shall be the net amount so
determined.
"Total Capitalization" means, with respect to the
Company, the sum of (a) the total stockholders' equity of the
Company and its Restricted Subsidiaries determined in accordance
with GAAP plus (b) the Total Debt of the Company.
"Total Debt" means, with respect to the Company, the
total consolidated Indebtedness of the Company and its Restricted
Subsidiaries.
"United States Governmental Security" means any direct
obligation of, or obligation guaranteed by, the United States of
America, or any agency controlled or supervised by or acting as
an instrumentality of the United States of America pursuant to
authority granted by the Congress of the United States of
America, so long as such obligation or guarantee shall have the
benefit of the full faith and credit of the United States of
America which shall have been pledged pursuant to authority
granted by the Congress of the United States of America.
"Unfunded Pension Liability" means the excess of a
Pension Plan's benefit liabilities under Section 302(d)(7) of
ERISA, over the current value of that Plan's assets, determined
in accordance with the assumptions used for funding the Pension
Plan pursuant to Section 412 of the Code for the applicable plan
year.
"Unrestricted Subsidiary" means any Subsidiary that is
not a Restricted Subsidiary.
"Voting Stock" means, with respect to any Person, the
shares of any class or classes of such Person having voting power
(not depending on the happening of a contingency) for the
election of the majority of the members of the board of
directors, the managers, the trustees or any other governing body
of such Person.
"WBI Metropolitan Notes" means the 7.45% Senior Notes
due 2006 of Williston Basin payable to Metropolitan Life
Insurance Company.
"Wholly-Owned Subsidiary" means, at any time, any
Subsidiary 100% of all of the equity interests (except directors'
qualifying shares) and voting interests of which are owned by any
one or more of the Company and the Company's other Wholly-Owned
Subsidiaries at such time. "Wholly-Owned Restricted Subsidiary"
means, at any time, any Restricted Subsidiary 100% of all of the
equity interests (except directors' qualifying shares) and voting
interests of which are owned by any one or more of the Company
and the Company's other Wholly-Owned Restricted Subsidiaries at
such time.
"Williston Basin" is defined in Section 10.9.
"Williston Basin Notes" means the notes outstanding
under the Williston Basin Shelf Agreement.
"Williston Basin Shelf Agreement" means the Master
Shelf Agreement between Williston Basin and PICA dated as of
October 10, 1996, as amended from time to time.