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Exhibit 10.1
AMENDMENT TO OPTION AGREEMENT
This AMENDMENT TO OPTION AGREEMENT (this "Amendment") dated as of
November 19, 2001 is by and among CGNN Holding Company, Inc., a Delaware
corporation (the "Grantor"), MCTJ Holding Co. LLC, a Delaware limited liability
company (the "Company"), Enron Corp., an Oregon corporation ("Enron"), Dynegy
Holdings Inc., a Delaware corporation (the "Grantee"), and Dynegy Inc., an
Illinois corporation ("Dynegy").
RECITALS
A. On November 9, 2001, the Grantor, the Company, Enron, the
Grantee and Dynegy entered into an Option Agreement (the "Option Agreement").
B. The parties to the Option Agreement now desire to amend the
Option Agreement as specified below.
C. The Grantor, the Company, Enron, the Grantee, Dynegy, NNGC
Holding Company, Inc., a Delaware corporation, Northern Natural Gas Company, a
Delaware corporation, and the lenders party thereto the Credit Agreement are
parties to an Agreement and Consent, dated as of November 19, 2001 (the
"Agreement and Consent").
NOW THEREFORE, in consideration of the mutual agreements herein
contained and other good and valuable consideration, the sufficiency of which is
hereby acknowledged, the parties hereby agree as follows:
1. Section 2.3 of the Option Agreement is hereby amended to add a
new last sentence as follows:
Notwithstanding the foregoing, in the event the Option is
exercised after a closing under the Purchase Option Agreement,
the Exercise Price shall be adjusted as appropriate to include
only those changes in Estimated Working Capital since the
closing under the Purchase Option Agreement.
2. Section 2.4 of the Option Agreement is hereby amended to add a
new penultimate sentence as follows:
If the Option becomes exercisable pursuant to Section 2.5.1.5
but ceases to be exercisable pursuant thereto or if the
Grantee exercises the Option pursuant to Section 2.5.1.5 but
Grantor purchases the Option Interests pursuant to the
Purchase Option Agreement, the Option will remain or once
again become exercisable in accordance with its terms until
the expiration of the Option Term.
3. The Option Agreement is hereby amended to add a new
Section 2.5.1.5 as follows:
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2.5.1.5. the earlier to occur of (i) the moment in time
immediately prior to the expiration of the Standstill
Period (as defined in the Agreement and Consent) or
(ii) the moment in time immediately prior to the
exercise by Dynegy of its rights under either the
second or third paragraphs of Section 6 of the
Agreement and Consent, PROVIDED, HOWEVER, that the
Grantee may not exercise the Option pursuant to this
Section 2.5.1.5 if prior to such time all Events of
Default under the Credit Agreement that permitted the
Option to be exercisable under this Section 2.5.1.5
shall have been waived or shall have been cured other
than as a result of the exercise by Dynegy of its
rights under either the second or third paragraphs of
Section 6 of the Agreement and Consent.
4. The Option Agreement is hereby amended to add a new
Section 2.7 as follows:
2.7 SALE OF THE OPTION. If the Option is exercisable pursuant
to Section 2.5 and the conditions to closing in Section 3.3 have not
been satisfied, the Grantee (in addition to any rights Dynegy has
pursuant to Section 8.4 of the Subscription Agreement) will have the
right to sell the Option to any other Person in a transaction that
complies with the Securities Act.
5. Section 4.5 of the Option Agreement is hereby amended in its
entirety to provide as follows:
4.5 FORGIVENESS OF DEBT OWED BY ENRON. After the Exercise and
prior to the Closing, the Company will, and will cause NNGC to, cancel
and forgive all indebtedness owed to the Company or any of its
Subsidiaries by Enron or its Affiliates (other than the Company and
NNGC Holdings), other than a net amount of such debt equal to $240
million plus any dividends (whether or not declared) accrued and unpaid
on the shares of Series A Preferred Stock at such time. The remaining
outstanding indebtedness will be evidenced by a note of Enron to NNGC
in substantially the form of Exhibit A and, in the event that the
Option is exercised after a closing under the Purchase Option
Agreement, the note so evidencing the remaining indebtedness shall
replace the note issued in connection with the initial exercise of the
Option. For purposes of this Section 4.5, "indebtedness" shall include
any liability of Enron or its Affiliates (other than the Company and
NNGC Holdings) under Section 18-607 of the Delaware Limited Liability
Company Act or otherwise to return to the Company any portion of the
distribution of up to $1,950 million made by the Company to the Grantor
from the proceeds of one or more loans from NNGC.
6. Sections 4.8.4, 4.8.5, 4.8.6, 4.8.8 and 4.8.9 of the Option
Agreement are hereby amended in their entirety to provide as follows:
4.8.4. MERGERS. Merge or consolidate, or enter into an
agreement providing for any merger or consolidation, with any Person if
the holders of its
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capital stock prior to the transaction will own capital stock
representing less than 100% of the voting power of the surviving entity
after the transaction;
4.8.5. SALE OF ASSETS. Except as provided in Schedule 4.8.5,
sell, lease or otherwise dispose of any of its assets, other than (i)
obsolete equipment or inventory, (ii) assets sales in the Ordinary
Course of Business not to exceed an aggregate of $20 million within any
12-month period and (iii) the grant of Liens (as defined in the Credit
Agreement) created under the Loan Documents (as defined in the Credit
Agreement) and any sales or other dispositions with respect to assets
covered by such Liens pursuant to the exercise by the Paying Agent, the
Collateral Trustee, the Co-Administrative Agents or any Bank (all as
defined in the Credit Agreement) of its remedies in respect of the
Collateral (as defined in the Credit Agreement) pursuant to the Loan
Documents, including foreclosure, sale in lieu of foreclosure or the
institution of litigation;
4.8.6. LIQUIDATION; DISSOLUTION; BANKRUPTCY. (i) Dissolve or
liquidate, in whole or in part, (ii) pursuant to or within the meaning
of Title 11 of the United States Code or any similar federal, state or
foreign law for the relief of debtors, commence a voluntary case or
consent to the entry of an order for relief against it in an
involuntary case, (iii) consent to the appointment of a receiver,
trustee, assignee, liquidator or similar official of it or for all or
substantially all of its property, (iv) make a general assignment for
the benefit of its creditors, (v) admit in writing its inability to pay
its debts generally as they become due, or (vi) take any corporate
action in furtherance of any action set forth in items (i) through (v)
hereof;
4.8.8. INVESTMENTS AND LOANS. Make any Investment in any
Person or any loans or advances to, or guarantees for the benefit of,
any Person, other than (i) loans to any wholly owned Subsidiary, (ii)
loans to MCTJ Holding Co. LLC and the assumption of Debt of Enron,
provided that the aggregate principal amount of such loans and assumed
Debt does not exceed $1,950 million, (iii) loans pursuant to the Cash
Management Program and (iv) Investments, loans, advances and guarantees
made in the Ordinary Course of Business;
4.8.9. INDEBTEDNESS. Create, incur, assume or suffer to
exist, or permit any of its Subsidiaries to create, incur, assume or
suffer to exist, Debt, other than (i) the Debt outstanding as of the
date hereof, (ii) Debt in an aggregate principal amount not exceeding
$450 million outstanding at any time pursuant to the Loan Documents and
(iii) Permitted Refinancing Debt;
7. The Option Agreement is hereby amended to add a new
Section 4.8.12 as follows:
4.8.12. AMENDMENTS TO CREDIT AGREEMENTS. Make any amendment
to any credit agreement, security document, mortgage or evidence of
indebtedness that would have the effect of (a) restricting the ability
of NNGC to make distributions on or payments in respect of the Series A
Preferred Stock beyond any restrictions contained in the Loan Documents
as of the date hereof or (b)
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designating as an event of default thereunder the exercise by the
Grantee of the Option.
8. The Option Agreement is hereby amended to add a new
Section 4.9 as follows:
4.9. INFORMATION. Enron, Grantor and the Company shall
promptly furnish to the Grantee as soon as possible and in any event
within five days after an executive officer of NNGC having obtained
knowledge thereof, notice of the occurrence of any Event of Default or
any Default (each as defined in the Credit Agreement), in each case
continuing on the date of such notice, and a statement of the Senior
Vice President and Treasurer of the NNGC setting forth details of such
Event of Default or Default and the action which the NNGC has taken and
proposes to take with respect thereto.
9. The Option Agreement is hereby amended to add new
Sections 5.2.17 and 5.2.18 as follows:
5.2.17. NNGC COMMON STOCK. The shares of common stock of
NNGC are not subject to any Liens, except Liens created pursuant to the
Security Documents (as defined in the Credit Agreement).
5.2.18. GUARANTEES. None of NNGC, NNGC Holdings and the
Company has guaranteed or taken responsibility for the payment of any
Debt of Enron or any Affiliate of Enron (other than Debt of the Company
and Subsidiaries of the Company).
10. Section 9.8 of the Option Agreement is hereby amended in its
entirety to provide as follows:
9.8. ASSIGNMENT. Neither this Agreement nor any of the
rights, interests or obligations hereunder or under the Option shall be
sold, assigned or otherwise disposed of or transferred by either of the
parties hereto (whether by operation of law or otherwise) without the
prior written consent of the other party, except that the Grantee may
assign this Agreement to an Affiliate or Subsidiary of the Grantee or
to any purchaser of the Option pursuant to Section 2.7; PROVIDED,
HOWEVER, that no such assignment shall have the effect of releasing the
Grantee from its obligations hereunder (except upon a sale of the
Option pursuant to Section 2.7) and the assignee shall be subject to
all of the terms and conditions of this Agreement as if it were the
Grantee. Subject to the preceding sentence, this Agreement shall be
binding upon, inure to the benefit of and be enforceable by the parties
and their respective successors and assigns. Any assignee must become a
party to and be bound by the Agreement and Consent
11. As used in this Amendment:
(a) "capital stock representing voting power" and similar
phrases refer to capital stock or similar equity securities which in ordinary
circumstances vote in the election of directors of a corporation or similar
body of an entity with another organizational form;
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(b) "Investment" as applied to any Person means (a) any direct
or indirect purchase or other acquisition by such Person of any notes,
obligations, instruments, stock, securities or ownership interest of any other
Person and (b) any capital contribution by such Person to any other Person; and
(c) "Credit Agreement" means the Credit Agreement dated as of
November 19, 2001 among Northern Natural Gas Company, a Delaware corporation,
the banks named therein, Citicorp North America, Inc. as Paying Agent,
JPMorgan Chase Bank as Collateral Trustee and Issuing Bank and Citicorp North
America, Inc. and JPMorgan Chase Bank as Co-Administrative Agents, as amended,
restated, modified or supplemented from time to time.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
signed by their respective officers thereunto duly authorized, all as of the day
and year first written above.
ENRON CORP.,
an Oregon corporation
By: /s/ Raymond M. Bowen, Jr.
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Name: Raymond M. Bowen, Jr.
Title: Authorized Agent
CGNN HOLDING COMPANY, INC.,
a Delaware corporation
By: /s/ Kevin A. Howard
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Name: Kevin A. Howard
Title: Authorized Agent
MCTJ HOLDING CO. LLC,
a Delaware limited liability company
By: /s/ Kevin A. Howard
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Name: Kevin A. Howard
Title: Authorized Agent
DYNEGY HOLDINGS INC.,
a Delaware corporation
By: /s/ Hugh A. Tarpley
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Name: Hugh A. Tarpley
Title: Authorized Agent
DYNEGY INC.,
an Illinois corporation
By: /s/ Hugh A. Tarpley
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Name: Hugh A. Tarpley
Title: Authorized Agent
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