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ASSET AND STOCK TRANSFER AGREEMENT
Dated as of November 15, 2002
by and between
NORTHWESTERN ENERGY, L.L.C.
(formerly known as THE MONTANA POWER, L.L.C.)
and
NORTHWESTERN CORPORATION
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TABLE OF CONTENTS
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1. DEFINITIONS................................................................1
2. TRANSFER OF ASSETS.........................................................5
2.1 Transfer.......................................................5
2.2 Excluded Assets................................................5
2.3 Assumption of Certain Liabilities..............................5
2.4 Excluded Liabilities...........................................5
2.5 Closing........................................................5
2.6 Transactions and Documents at Closing..........................6
2.7 Further Assurances............................................6
2.8 Grant of Easements.............................................6
3. REPRESENTATIONS AND WARRANTIES OF TRANSFEROR...............................6
3.1 Organization and Compliance....................................6
3.2 Enforceability of Agreement....................................7
3.3 No Inconsistent Obligations....................................7
3.4 Possession of Franchises, Licenses, Etc........................7
4. REPRESENTATIONS AND WARRANTIES OF TRANSFEREE...............................7
4.1 Organization...................................................7
4.2 Authorization; Enforceability of Agreement.....................7
4.3 No Inconsistent Obligations....................................8
5. COVENANTS OF TRANSFEROR....................................................8
5.1 Regulatory and Other Approvals.................................8
5.2 Fulfillment of Conditions......................................8
6. COVENANTS OF TRANSFEREE....................................................8
6.1 Regulatory and Other Approvals.................................8
6.2 Fulfillment of Conditions......................................9
7. CONDITIONS PRECEDENT TO OBLIGATIONS OF TRANSFEREE..........................9
7.1 Proceedings and Documents Satisfactory.........................9
7.2 Representations and Warranties.................................9
7.3 Compliance with Agreements and Conditions......................9
7.4 No Injunctions, Restraints or Litigation.......................9
7.5 Master Back-to-Back Agreement.................................10
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7.6 Power Purchase Agreement......................................10
7.7 Maintenance and Operating Costs Support Agreement.............10
7.8 Environmental Liabilities Support Agreement...................10
7.9 Interconnection Agreement.....................................10
7.10 Secondment Agreement..........................................10
7.11 Pollution Liability Insurance.................................10
7.12 Environmental Liabilities Report..............................10
7.13 Approvals of Governmental or Regulatory Authorities...........11
7.14 Exempt Wholesale Generator Status.............................11
7.15 Other Consents................................................11
7.16 Release of Excluded Assets....................................11
7.17 Other Transfer Documents......................................11
8. CONDITIONS PRECEDENT TO OBLIGATIONS OF TRANSFEROR.........................11
8.1 Proceedings and Documents Satisfactory........................11
8.2 Representations and Warranties................................11
8.3 Compliance with Agreements and Conditions.....................12
8.4 No Injunctions, Restraints or Litigation......................12
8.5 Master Back-to-Back Agreement.................................12
8.6 Power Purchase Agreement......................................12
8.7 Maintenance and Operating Costs Support Agreement.............12
8.8 Environmental Liabilities Support Agreement...................12
8.9 Interconnection Agreement....................................12
8.10 Secondment Agreement..........................................12
8.11 Pollution Liability Insurance.................................12
8.12 Environmental Liabilities Report..............................12
8.13 Approvals of Governmental or Regulatory Authorities...........12
8.14 Release of Excluded Assets....................................13
8.15 Other Assumption Documents....................................13
9. EVIDENCE OF CLOSING......................................................13
9.1 Closing Certificate...........................................13
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10. SURVIVAL.................................................................13
10.1 Survival of Representations, Warranties, Covenants and
Agreements........... .......................................13
11. MISCELLANEOUS............................................................13
11.1 Counterparts..................................................13
11.2 Entire Agreement..............................................13
11.3 Governing Law.................................................13
11.4 Successors and Assigns........................................14
11.5 Partial Invalidity and Severability...........................14
11.6 Waiver........................................................14
11.7 Headings......................................................14
11.8 Number and Gender.............................................14
11.9 Time of Performance...........................................14
11.10 No Third Party Beneficiary....................................14
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TABLE OF SCHEDULES AND EXHIBITS
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SCHEDULES
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Schedule 2.2 - Excluded Assets
Schedule 2.4 - Excluded Liabilities
EXHIBITS
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Exhibit A - Bill of Transfer and Assignment
Exhibit B - Master Assumption Agreement
Exhibit C - Master Back-to-Back Agreement
Exhibit D - Maintenance and Operating Costs Support Agreement
Exhibit E - Environmental Liabilities Support Agreement
Exhibit F - Interconnection Agreement
Exhibit G - Employee Secondment and Administrative Services Agreement
Exhibit H-1 - Closing Certificate (Transferor)
Exhibit H-2 - Closing Certificate (Transferee)
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ASSET AND STOCK TRANSFER AGREEMENT
THIS ASSET AND STOCK TRANSFER AGREEMENT (this "Agreement") is made and
entered into as of the 15th day of November, 2002, by and between NORTHWESTERN
ENERGY, L.L.C., a Montana limited liability company ("Transferor") and
NORTHWESTERN CORPORATION, a Delaware corporation ("Transferee").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, on January 31, 2002, the Montana Public Service Commission (the
"MPSC") issued its Final Order No. 6353c, in Docket No. D2001.1.5, approving the
stipulation filed by The Montana Power Company ("MPC"), Transferee, the Montana
Consumer Counsel, the Large Customer Group and Commercial Energy Montana,
finding that MPC's utility operations, as a subsidiary or division of
Transferee, would be a fit, willing and able provider of adequate utility
service and facilities at just and reasonable rates;
WHEREAS, in accordance with the Final Order, on February 15, 2002,
Transferee purchased all of the outstanding membership interests in Transferor
pursuant to the Unit Purchase Agreement, dated as of September 29, 2000, as
amended, between Transferee, MPC and Touch America Holdings, Inc. and Transferee
continues to own all of the membership interests in Transferor;
WHEREAS, the parties desire that Transferor transfer substantially all
of Transferor's assets to Transferee, except for those assets and liabilities
associated with the Milltown hydroelectric dam on the Clark Fork River (the
"Milltown Dam") and certain other excluded assets and liabilities, as set forth
more fully herein; and
WHEREAS, from and after the consummation of the transfer and assumption
contemplated hereby, Transferee desires to operate the business comprising the
Transferred Assets as a division of Transferee to be known as "NorthWestern
Energy;"
NOW, THEREFORE, for and in consideration of the premises and the mutual
covenants and agreements herein contained, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:
1. DEFINITIONS
As used in this Agreement, the following defined terms have the meanings
indicated below:
"Agreement" shall have the meaning ascribed to such term in the recitals
herein.
"Assumed Liabilities" shall have the meaning ascribed to such term in
Section 2.3 herein.
"Assumption Documents" shall have the meaning ascribed to such term in
Section 2.6(a) herein.
"Closing Certificate" shall have the meaning ascribed to such term in
Section 9.1 herein.
"Closing Date" shall have the meaning ascribed to such term in Section
2.5 herein.
"Closing" shall have the meaning ascribed to such term in Section 2.5
herein.
"CHHTD" shall have the meaning ascribed to such term in Section 2.5
herein.
"Effective Date" shall have the meaning ascribed to such term in Section
2.5 herein.
"Environmental Laws" shall mean all Federal, state, municipal and local
laws (including common laws), regulations, rules, ordinances, codes, licenses,
decrees, judgments, directives, or judicial or administrative orders relating to
pollution, protection, preservation or restoration of human health, the
environment or natural resources, including, without limitation, laws relating
to releases or threatened releases of Hazardous Materials (including, without
limitation, into or through ambient air, surface water, groundwater, land,
wetlands, surface and subsurface strata) or otherwise relating to the
manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of Hazardous Materials, including without limitation the
Clean Water Act, the Clean Air Act, the Resource Conservation and Recovery Act,
the Toxic Substances Control Act, and the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, in each case as amended, and their local
counterparts.
"Environmental Liabilities" shall mean and include any investigation,
notice of violation, demand, allegation, action, suit, injunction, judgment,
order, consent decree, penalty, fine, lien, liability, obligation, sanction,
abatement, proceeding, or claim (whether administrative, judicial or private in
nature) arising: (A) pursuant to, or in connection with, an actual or alleged
violation of any Environmental Law; (B) in connection with any Hazardous
Materials or actual or alleged activity associated with any Hazardous Materials;
(C) from any remediation, abatement, removal, remedial, corrective, or other
response action in connection with any Hazardous Materials, Environmental Law or
other order or directive of any Governmental or Regulatory Authority; (D) from
any actual or alleged damage, injury, threat or harm to health, safety, natural
resources, or the environment; (E) from the use, management, disposal or release
(or threatened release) of Hazardous Materials; (F) from personal injury
(including death), tangible or intangible property damage, damage to the
environment or natural resources, pollution or contamination arising under
Environmental Laws; or (G) from the contribution to the cost of investigating,
removing, responding, remediating or monitoring the release of Hazardous
Materials.
"Environmental Liabilities Support Agreement" shall have the meaning
ascribed to such term in Section 7.8 herein.
"Environmental Liabilities Report" shall have the meaning ascribed to
such term in Section 7.12 herein.
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"Excluded Assets" shall have the meaning ascribed to such term in
Section 2.2 herein.
"Excluded Liabilities" shall have the meaning ascribed to such term in
Section 2.4 herein.
"Excluded Litigation" shall have the meaning ascribed to such term in
Schedule 2.4.
"FERC" shall mean the Federal Energy Regulatory Commission.
"FERC EWG Filing" shall mean an application to FERC filed in good faith
by Transferor for certification of Transferor as an Exempt Wholesale Generator
under Section 32 of PUHCA.
"FERC Securities Order" shall mean an order of the FERC pursuant to
Section 204 of the Federal Power Act approving Transferee's Application for
Authorization of the Assumption of Liabilities and Authorization for Exemption
from Competitive Bidding and Negotiated Offer Requirements and Expedited
Treatment filed with the FERC on October 25, 2002, relating to the assumption by
Transferee of Transferor's outstanding indebtedness and other securities.
"Final Order" shall have the meaning ascribed to such term in the
recitals herein.
"First Mortgage" shall have the meaning ascribed to such term in Section
2.1 herein.
"Governmental or Regulatory Authorities" shall mean any court, tribunal,
arbitrator, authority, agency, commission, official or other instrumentality of
the United States or Canada or any state, county, city, tribal or other
political subdivision.
"Hazardous Materials" shall mean (a) any petrochemical, petroleum or
petroleum products, oil, flammable explosives, radioactive materials, radon gas,
asbestos in any form that is or could become friable, urea formaldehyde foam
insulation and transformers or other equipment that contain dielectric fluid
which may contain levels of polychlorinated biphenyls (PCBs); (b) any chemicals
or other materials or substances which are now or hereafter become defined under
any Environmental Law as or included in the definition of "hazardous
substances", "hazardous wastes", "hazardous chemicals", "hazardous materials",
"extremely hazardous wastes", "restricted hazardous wastes", "toxic substances",
"pollutants", "contaminants", "hazardous matter", "restricted hazardous
materials", or words of similar import; and (c) any other chemical or other
material or substance, the discharge, emission, release or exposure to which is
now or hereafter prohibited, limited or regulated by any Governmental or
Regulatory Authority under any Environmental Law.
"Interconnection Agreement" shall have the meaning ascribed for such
term in Section 7.9 herein.
"Laws" shall mean all laws, statutes, rules, regulations, ordinances and
other pronouncements having the effect of law of the United States, any foreign
country or any
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domestic or foreign state, county, city or other political subdivision or of
any Governmental or Regulatory Authority.
"Maintenance and Operating Costs Support Agreement" shall have the
meaning ascribed to such term in Section 7.7 herein.
"Master Back-to-Back Agreement" shall have the meaning ascribed to such
term in Section 7.5 herein.
"Milltown Dam" shall have the meaning ascribed to such term in the
recitals herein.
"MPC" shall have the meaning ascribed to such term in the recitals
herein.
"MPSC" shall have the meaning ascribed to such term in the recitals
herein.
"MPSC EWG Determination" shall mean the order of the MPSC approving the
Transferor's Application for Certain Determinations Required by Subparagraphs
32(c) and (k)(2) of the Public Utility Holding Company Act of 1935 Concerning
its Contract with Northwestern Corporation, as filed with the MPSC on October
22, 2002.
"Permits" shall have the meaning ascribed to such term in Section 3.4
hereof.
"Person" shall mean any natural person, corporation, limited liability
company, general partnership, limited partnership, proprietorship, other
business organization, trust, union, association or Governmental or Regulatory
Authority.
"PUHCA" shall mean the Public Utilities Holding Companies Act of 1935.
"Pollution Liability Insurance" shall have the meaning ascribed to such
term in Section 7.11 herein.
"Power Purchase Agreement" shall have the meaning ascribed to such term
in Section 7.6 herein.
"Secondment Agreement" shall have the meaning ascribed to such term in
Section 7.10 hereof.
"Transfer Documents" shall have the meaning ascribed to such term in
Section 2.6(a).
"Transferee" shall have the meaning ascribed to such term in the
recitals herein.
"Transferor" shall have the meaning ascribed to such term in the
recitals herein.
"Transferred Assets" shall have the meaning ascribed to such term in
Section 2.1 herein.
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"UPA" shall mean that certain Unit Purchase Agreement, dated as of
September 29, 2000, by and between Transferee, Touch America Holdings, Inc. and
The Montana Power Company, as amended.
2. TRANSFER OF ASSETS
2.1 Transfer. Subject to the terms and conditions contained herein,
Transferor agrees to transfer, convey and assign to Transferee, and Transferee
agrees to acquire from Transferor, on the Closing Date, all of Transferor's
right, title and interest in and to all of the assets and properties of
Transferor, real, personal and mixed, of every kind and nature, including
without limitation, contracts, insurance policies and rights to coverage under
insurance policies now or at any time obtained by Transferor or any of its
predecessor entities, choses in action and other rights and interests of
Transferor, excluding, however, the Excluded Assets (all of the foregoing,
excluding the Excluded Assets, being the "Transferred Assets"). The transfer of
the Transferred Assets hereunder, to the extent applicable, is expressly made
subject to that certain Mortgage and Deed of Trust, dated as of October 1, 1945,
from Transferor (as successor to the utility business of MPC) to the Bank of New
York (successor Corporate Trustee) and Douglas J. MacInnes (successor
Co-trustee), as Trustees, as supplemented and amended (the "First Mortgage"),
and upon such terms as fully to preserve and in no respect impair the lien or
security of the First Mortgage.
2.2 Excluded Assets. Notwithstanding anything in this Agreement to the
contrary, the Transferred Assets shall not include the assets and property
related to, or in connection with, the Milltown Dam and certain other assets of
Transferor, all as described more fully in Schedule 2.2 attached hereto (the
"Excluded Assets").
2.3 Assumption of Certain Liabilities. Transferee agrees to assume on
the Closing Date, and to pay or perform, in accordance with their terms, any and
all obligations and liabilities of Transferor, direct or indirect, known or
unknown, absolute or contingent, arising or relating to the period before the
Closing, except the Excluded Liabilities (the "Assumed Liabilities").
2.4 Excluded Liabilities. Notwithstanding anything in this Agreement to
the contrary, the Assumed Liabilities shall not include (i) any obligations and
liabilities of Transferor described in Schedule 2.4 attached hereto or (ii) any
obligations or liabilities of Transferor not related to the Transferred Assets,
whether arising or related to the period before or following the Closing (the
"Excluded Liabilities").
2.5 Closing. In the event that the FERC Securities Order is issued on or
before November 15, 2002, the consummation of the transactions contemplated in
this Agreement (the "Closing") shall be held at 10:00 am, local time, on
November 15, 2002 or at such other date or time as shall be mutually acceptable
to the parties (the "Closing Date"). If the FERC Securities Order has not been
issued by November 15, 2002, then on the Closing Date, the parties shall execute
and deliver all documents and instruments, which shall be dated the Closing
Date, contemplated to be delivered hereby or in connection herewith on or prior
to the Closing to Crowley, Haughey, Hanson, Toole & Dietrich P.L.L.P. ("CHHTD")
to be held in escrow by
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CHHTD until the date on which the FERC Securities Order has been issued (the
"Effective Date"). On the Effective Date, CHHTD shall release all such documents
and instruments from escrow and the Closing shall be deemed to have occurred and
all such documents and instruments shall be deemed effective and in full force
and effect or otherwise delivered, filed or processed as directed by the
parties. The Closing shall be held at the offices of the Transferor in Butte,
Montana, or at such other place as shall be mutually acceptable to the parties.
2.6 Transactions and Documents at Closing. At the Closing, Transferor
shall convey to Transferee all of Transferor's right, title and interest in and
to the Transferred Assets (and not the Excluded Assets), subject to the First
Mortgage and in furtherance thereof shall deliver to Transferee a Bill of
Transfer and Assignment in substantially the form attached hereto as Exhibit A,
together with such other deeds, bills of sale, assignments, certificates of
title, stock or unit certificates, documents and other instruments of transfer
and conveyance as are specified in Section 7 hereof or as Transferee shall
reasonably request (collectively, the "Transfer Documents"), and Transferee
shall deliver to Transferor a Master Assumption Agreement in substantially the
form attached hereto as Exhibit B pursuant to which Transferee shall assume the
Assumed Liabilities (and not the Excluded Liabilities) together with such other
documents and instruments as are specified in Section 8 hereof or as Transferor
shall reasonably request (collectively, the "Assumption Documents").
2.7 Further Assurances. Each party shall, at the request of any other
party from time to time and at any time, whether on or after the Closing Date,
and without further consideration, take such action and execute and deliver such
deeds, assignments, transfers, assumptions, conveyances, powers of attorney,
receipts, acknowledgements, acceptances, assurances and other documents as may
be reasonably necessary or useful to procure for the party so requesting, and
its successors and assigns, for aiding and assisting in collecting and reducing
to possession, or for vesting and perfecting title to, any and all of the
Transferred Assets or the Assumed Liabilities, or otherwise to satisfy and
perform the obligations of the parties hereunder.
2.8 Grant of Easements. Transferor will, at Transferee's request and
expense and without additional consideration, grant to Transferee, at Closing
and from time to time subsequent to Closing, all appropriate easements across
lands included in the Excluded Assets (i) for existing electric and gas
transmission and distribution lines and related facilities included in the
Transferred Assets and (ii) for access to the Transferred Assets, on forms
reasonably acceptable to Transferee.
3. REPRESENTATIONS AND WARRANTIES OF TRANSFEROR
To induce Transferee to enter into this Agreement, to acquire the
Transferred Assets and to assume the Assumed Liabilities, Transferor represents
and warrants to Transferee as follows:
3.1 Organization and Compliance. Transferor is a limited liability
company duly organized, validly existing and in good standing under the laws of
the State of Montana.
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Transferor has all requisite limited liability company power and authority and
is entitled to own or lease the Transferred Assets.
3.2 Enforceability of Agreement. Transferor has the full limited
liability company power and authority to enter into this Agreement and to carry
out the transactions contemplated hereby in accordance with its terms. This
Agreement and all transactions required hereunder to be performed by Transferor
have been duly and validly authorized by all necessary limited liability company
action. This Agreement has been duly and validly and delivered on
behalf of Transferor and constitutes the valid and legally binding obligation of
Transferor, enforceable in accordance with its terms, except as limited by
bankruptcy, insolvency, reorganization or similar laws affecting the rights of
creditors generally.
3.3 No Inconsistent Obligations. Neither the execution and delivery of
this Agreement, nor the consummation of the transactions contemplated herein,
subject to the terms hereof, will result in a violation or breach of, or
constitute a default under (a) the articles of organization or operating
agreement of Transferor, (b) any term or provision of (i) any material
indenture, note, mortgage, bond, security agreement, loan agreement, guaranty,
pledge, or other instrument, contract, agreement or commitment, or (ii) any
material writ, order, judgment, decree, law, rule, regulation, or ordinance, or
(iii) any material applicable ruling or order of any Governmental or Regulatory
Authority, in each case to which Transferor is a party or any of the Transferred
Assets is subject or bound, or (c) result in (i) the creation of any material
claim, lien, charge or encumbrance on any of the Transferred Assets, (ii) the
acceleration or creation of any material obligation of Transferor, or (iii) the
forfeiture of any material right or privilege of Transferor.
3.4 Possession of Franchises, Licenses, Etc. Transferor possesses all
material franchises, certificates, licenses, grants, permits, agreements and
other authorizations ("Permits") from Governmental or Regulatory Authorities,
free from materially burdensome restrictions, that are necessary for the
ownership, maintenance and operation of its properties, assets and business and
Transferor is not in material violation of any thereof.
4. REPRESENTATIONS AND WARRANTIES OF TRANSFEREE
As an inducement to the Transferor to enter into this Agreement and to
transfer the Transferred Assets to Transferee, Transferee hereby represents,
warrants and covenants as follows:
4.1 Organization. Transferee is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware.
4.2 Authorization; Enforceability of Agreement. Transferee has full
corporate power and authority to enter into this Agreement and to carry out the
transactions contemplated hereby in accordance with its terms. This Agreement
and all transactions required hereunder to be performed by Transferee have been
duly and validly authorized by all necessary corporate action on the part of
Transferee. This Agreement has been duly and validly executed and
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delivered on behalf of Transferee and constitutes the valid and legally binding
obligation of Transferee, enforceable in accordance with its terms, except as
may be limited by bankruptcy, insolvency, reorganization or similar laws
affecting the rights of creditors generally.
4.3 No Inconsistent Obligations. Neither the execution and delivery of
this Agreement, nor the consummation of the transactions hereby contemplated,
subject to the terms hereof, will result in a violation or breach of, or
constitute a default under (a) the articles of organization or operating
agreement of Transferee, (b) any term or provision of (i) any material
indenture, note, mortgage, bond, security agreement, loan agreement, guaranty,
pledge, or other instrument, contract, agreement or commitment, or (ii) any
material writ, order, judgment, decree, law, rule, regulation, or ordinance, or
(iii) any material applicable ruling or order of any Governmental or Regulatory
Authority, in each case to which Transferee is a party, or (c) result in (i) the
creation of any material claim, lien, charge or encumbrance on any of the assets
of Transferee, (ii) the acceleration or creation of any material obligation of
Transferee, or (iii) the forfeiture of any material right or privilege of
Transferee.
5. COVENANTS OF TRANSFEROR
5.1 Regulatory and Other Approvals. Transferor will, as promptly as
practicable (a) take all commercially reasonable steps necessary or desirable to
obtain all consents, approvals or actions of, make all filings with and give all
notices to Governmental or Regulatory Authorities or any other Person required
of Transferor to consummate the transactions contemplated hereby, (b) provide
such other information and communications to such Governmental or Regulatory
Authorities or other Persons as such Governmental or Regulatory Authorities or
other Persons may reasonably request in connection therewith and (c) provide
reasonable cooperation to Transferee in connection with the performance of its
obligations hereunder. Transferor will provide prompt notification to Transferee
when any such consent, approval, action, filing or notice referred to in clause
(a) above is obtained, taken, made or given, as applicable, and will advise
Transferee of any communications (and, unless precluded by Law, provide copies
of any such communications that are in writing) with any Governmental or
Regulatory Authority or other Person regarding any of the transactions
contemplated by this Agreement.
5.2 Fulfillment of Conditions. Transferor will take all commercially
reasonable steps necessary or desirable and proceed diligently and in good faith
to satisfy each condition to the obligations of Transferee contained in this
Agreement and will not take or fail to take any action that could reasonably be
expected to result in the nonfulfillment of any such condition.
6. COVENANTS OF TRANSFEREE
6.1 Regulatory and Other Approvals. Transferee will as promptly as
practicable (a) take all commercially reasonable steps necessary or desirable to
obtain all consents, approvals or actions of, make all filings with and give all
notices to Governmental or Regulatory Authorities or any other Person required
of Transferee to consummate the transactions contemplated hereby, (b) provide
such other information and communications to such
8
Governmental or Regulatory Authorities or other Persons as such Governmental or
Regulatory Authorities or other Persons may reasonably request in connection
therewith and (c) provide reasonable cooperation to Transferor in connection
with the performance of its obligations hereunder. Transferee will provide
prompt notification to Transferor when any such consent, approval, action,
filing or notice referred to in clause (a) above is obtained, taken, made or
given, as applicable, and will advise Transferor of any communications (and,
unless precluded by Law, provide copies of any such communications that are in
writing) with any Governmental or Regulatory Authority or other Person regarding
any of the transactions contemplated by this Agreement.
6.2 Fulfillment of Conditions. Transferee will take all commercially
reasonable steps necessary or desirable and proceed diligently and in good faith
to satisfy each condition to the obligations of Transferor contained in this
Agreement and will not take or fail to take any action that could reasonably be
expected to result in the nonfulfillment of any such condition.
7. CONDITIONS PRECEDENT TO OBLIGATIONS OF TRANSFEREE
All obligations of Transferee under this Agreement are subject to the
fulfillment and satisfaction of each and every of the following conditions
precedent on or prior to the Closing, any or all of which may be waived in whole
or in part by Transferee:
7.1 Proceedings and Documents Satisfactory. All proceedings taken in
connection with the consummation of the transactions contemplated herein and all
documents and papers reasonably required in connection therewith shall be
reasonably satisfactory to Transferee, and Transferee shall have timely received
copies of such documents and papers, all in form and substance satisfactory to
Transferee, as reasonably requested by Transferee in connection therewith.
7.2 Representations and Warranties. The representations and warranties
contained in Section 3 of this Agreement and in any agreement or other document
delivered by or on behalf of Transferor in connection with the transactions
contemplated by this Agreement, shall be true and correct at and as of the
Closing Date as if made as of such date.
7.3 Compliance with Agreements and Conditions. Transferor shall have
performed and complied with all agreements and conditions required by this
Agreement to be performed or complied with by Transferor prior to or on the
Closing Date.
7.4 No Injunctions, Restraints or Litigation. (i) There shall not be in
effect any order, judgment or decree issued by any court of competent
jurisdiction or other Governmental or Regulatory Authority or other legal
restraint or prohibition preventing the consummation of the transactions
contemplated by this Agreement; and (ii) there shall not exist or have been
instituted or be pending any action, suit or proceeding which, in the good faith
judgment of Transferee (after consultation with outside counsel) (A) would
reasonably be expected to make illegal, or to delay or otherwise restrain or
prohibit, the consummation of the transactions contemplated by this Agreement,
or which would reasonably be expected to result in material
9
damages in connection with transactions contemplated by this Agreement, or (B)
would reasonably be expected to result in (x) the prohibition of the ownership
or operation by Transferee of all or a material portion of the Transferred
Assets or (y) the compelling of Transferee to dispose of or to hold separately
any portion of the business or assets of Transferee or subsidiaries as a result
of the transactions contemplated by this Agreement.
7.5 Master Back-to-Back Agreement. Transferor shall have executed and
delivered the Master Back-to-Back Agreement, dated as of the date hereof, by and
between Transferor and Transferee, substantially in the form attached hereto as
Exhibit C (the "Back-to-Back Agreement").
7.6 Power Purchase Agreement. The Unit Power Purchase Agreement, dated
as of September 20, 2002, by and between Transferor and Transferee, (the "Power
Purchase Agreement") shall be in full force and effect.
7.7 Maintenance and Operating Costs Support Agreement. Transferor shall
have executed and delivered the Maintenance and Operating Costs Support
Agreement, dated as of the date hereof, by and between Transferor and
Transferee, relating to the maintenance and operating costs of the Milltown Dam,
substantially in the form attached hereto as Exhibit D (the "Maintenance and
Operating Costs Support Agreement").
7.8 Environmental Liabilities Support Agreement. Transferor shall have
executed and delivered the Environmental Liabilities Support Agreement, dated as
of the date hereof, by and between Transferor and Transferee, relating to
Transferor's Environmental Liabilities, substantially in the form attached
hereto as Exhibit E (the "Environmental Liabilities Support Agreement").
7.9 Interconnection Agreement. Transferor shall have executed and
delivered the Generation Interconnection Agreement, dated as of the date hereof,
between Transferor and Transferee, relating to the Milltown Dam, substantially
in the form attached hereto as Exhibit F (the "Interconnection Agreement").
7.10 Secondment Agreement. Transferor shall have executed and delivered
an Employee Secondment and Administrative Services Agreement, between Transferor
and Transferee, relating to the transferred employees performing functions at
the Milltown Dam, substantially in the form attached hereto as Exhibit G (the
"Secondment Agreement").
7.11 Pollution Liability Insurance. The Pollution Legal Liability Select
Policy Number PLS 1952382 issued by American International Specialty Lines
Insurance Company to Transferor from May 31, 2002 to May 31, 2012 (the
"Pollution Liability Insurance") shall be in full force and effect.
7.12 Environmental Liabilities Report. Transferee and Transferor shall
have received from ELM Consulting, L.L.C. a report on such matters relating to
the Milltown Dam as they shall reasonably request (the "Environmental
Liabilities Report") and such report shall be in form and substance satisfactory
to Transferee.
10
7.13 Approvals of Governmental or Regulatory Authorities. All necessary
filings shall have been made with, and consents and approvals of Governmental or
Regulatory Authorities necessary or desirable to consummate the transactions
contemplated hereby shall have been obtained therefrom, including, without
limitation, the FERC Securities Order.
7.14 Exempt Wholesale Generator Status. Either (i) the MPSC shall have
issued the MPSC EWG Determination and Transferor shall have made the FERC EWG
Filing or (ii) Transferor shall have shut down the operation of the Milltown Dam
such that no electricity is generated therefrom and Transferee shall have
received from Transferor a certificate and undertaking, signed by the Chief
Executive Officer of Transferor, (x) to such effect and (y) to the further
effect that operation of the Milltown Dam will not resume until after the MPSC
EWG Determination is issued and the FERC EWG filing is made by Transferor.
7.15 Other Consents. Transferor shall have delivered to Transferee such
consents and approvals from Transferor's lessors, lenders and other persons,
firms and other entities having business relations with Transferor as are
necessary in Transferee's reasonable opinion for the assignment to and
assumption by Transferee, and the continuation in full force and effect after
the Closing, (a) of the contracts comprising the Transferred Assets, and (b) of
Transferor's business to the extent relating to the Transferred Assets and
Assumed Liabilities (but not the Excluded Assets or Excluded Liabilities) in the
same manner as conducted prior to the Closing.
7.16 Release of Excluded Assets. The Excluded Assets shall have been
duly released from the lien of the First Mortgage and all necessary filings and
recordings in connection therewith shall have been made or accomplished.
7.17 Other Transfer Documents. Transferee shall have received such other
Transfer Documents from Transferor as Transferee may reasonably request.
8. CONDITIONS PRECEDENT TO OBLIGATIONS OF TRANSFEROR
All of the obligations of Transferor, under this Agreement are subject
to the fulfillment and satisfaction of each and every of the following
conditions precedent on or prior to the Closing, any or all of which may be
waived in whole or in part by Transferor:
8.1 Proceedings and Documents Satisfactory. All proceedings taken in
connection with the consummation of the transactions contemplated herein and all
documents and papers reasonably required in connection therewith shall be
reasonably satisfactory to Transferor, and Transferor shall have timely received
copies of such documents and papers, all in form and substance satisfactory to
Transferor, as reasonably requested by Transferor in connection therewith.
8.2 Representations and Warranties. The representations and warranties
contained in Section 4 of this Agreement and in any agreement or other document
delivered by or on behalf of Transferee in connection with the transactions
contemplated by this Agreement, shall be true and correct at and as of the
Closing Date as if made as of such date.
11
8.3 Compliance with Agreements and Conditions. Transferee shall have
performed and complied with all agreements and conditions required by this
Agreement to be performed or complied with by Transferee prior to or on the
Closing Date.
8.4 No Injunctions, Restraints or Litigation. (i) There shall: not be in
effect any order, judgment or decree issued by any court of competent
jurisdiction or other Governmental or Regulatory Authority or other legal
restraint or prohibition preventing the consummation of the transactions
contemplated by this Agreement; and (ii) there shall not exist or have been
instituted or be pending any action, suit or proceeding which, in the good faith
judgment of Transferor (after consultation with outside counsel) (A) would
reasonably be expected to make illegal, or to delay or otherwise restrain or
prohibit, the consummation of the transactions contemplated by this Agreement,
or which would reasonably be expected to result in material damages in
connection with transactions contemplated by this Agreement, or (B) would
reasonably be expected to result in the prohibition of the ownership or
operation by Transferee of all or a material portion of the Transferred Assets.
8.5 Master Back-to-Back Agreement. Transferee shall have executed and
delivered the Master Back-to-Back Agreement.
8.6 Power Purchase Agreement. The Power Purchase Agreement shall be in
full force and effect.
8.7 Maintenance and Operating Costs Support Agreement. Transferee shall
have executed and delivered the Maintenance and Operating Costs Support
Agreement.
8.8 Environmental Liabilities Support Agreement. Transferee shall have
executed and delivered the Environmental Liabilities Support Agreement.
8.9 Interconnection Agreement. Transferee shall have executed and
delivered the Interconnection Agreement.
8.10 Secondment Agreement. Transferee shall have executed and delivered
the Secondment Agreement.
8.11 Pollution Liability Insurance. The Pollution Liability Insurance
shall be in full force and effect.
8.12 Environmental Liabilities Report. The Environmental Liabilities
Report shall have been received by Transferor and such report shall be in form
and substance satisfactory to Transferor.
8.13 Approvals of Governmental or Regulatory Authorities. All necessary
filings shall have been made with, and consents and approvals of Governmental or
Regulatory Authorities necessary or desirable to consummate the transactions
contemplated hereby shall have been obtained therefrom, including, without
limitation, those with and from FERC and the
12
MPSC necessary to constitute Transferor an "exempt wholesale generator" under
Section 32 of PUHCA.
8.14 Release of Excluded Assets. The Excluded Assets shall have been
duly released from the lien of the First Mortgage and all necessary filings and
recordings in connection therewith shall have been made or accomplished.
8.15 Other Assumption Documents. Transferor shall have received such
other Assumption Documents from Transferee as Transferor may reasonably request.
9. EVIDENCE OF CLOSING
9.1 Closing Certificate. In order to evidence the Closing, at the
Closing each party hereto shall execute and deliver to the other party a closing
certificate, substantially in the form attached hereto as Exhibit H-1 and
Exhibit H-2, respectively, certifying that all conditions precedent herein to
the obligations of such party under this Agreement have been satisfied or
properly waived to the satisfaction of such party as of the Closing Date.
10. SURVIVAL
10.1 Survival of Representations, Warranties, Covenants and Agreements.
Except for any covenant or agreement of the parties hereto which by its terms
contemplates performance after the Closing Date, the representations,
warranties, covenants and agreements contained in this Agreement shall not
survive Closing and there shall be no liability in respect thereof, whether such
liability has accrued prior to the Closing Date or after the Closing Date, on
the part of either party or its officers, directors, employees, agents and
affiliates.
11. MISCELLANEOUS
11.1 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, and all of which shall
constitute one and the same instrument.
11.2 Entire Agreement. This Agreement supersedes all prior discussions
and agreements between the parties with respect to the subject matter hereof,
and this Agreement contains the sole and entire agreement among the parties with
respect to the matters covered hereby. This Agreement shall not be altered or
amended except by an instrument in writing signed by or on behalf of the party
entitled to the benefit of the provision against whom enforcement is sought.
11.3 Governing Law. The validity and effect of this Agreement shall be
governed by and construed and enforced in accordance with the internal laws of
the State of New York, without regard to principles of conflicts of laws.
13
11.4 Successors and Assigns. This Agreement shall be binding upon and
shall inure to the benefit of the parties hereto and their respective heirs,
executors, legal representatives, successors and assigns.
11.5 Partial Invalidity and Severability. All rights and restrictions
contained herein may be exercised and shall be applicable and binding only to
the extent that they do not violate any applicable laws and are intended to be
limited to the extent necessary to render this Agreement legal, valid and
enforceable. If any term of this Agreement, or part thereof, not essential to
the commercial purpose of this Agreement shall be held to be illegal, invalid or
unenforceable by a court of competent jurisdiction, it is the intention of the
parties that the remaining terms hereof, or part thereof shall constitute their
agreement with respect to the subject matter hereof and all such remaining
terms, or parts thereof, shall remain in full force and effect. To the extent
legally permissible, any illegal, invalid or unenforceable provision of this
Agreement shall be replaced by a valid provision which will implement the
commercial purpose of the illegal, invalid or unenforceable provision.
11.6 Waiver. Any term or condition of this Agreement may be waived at
any time by the party which is entitled to the benefit thereof, but only if such
waiver is evidenced by a writing signed by such party. No failure on the part of
any party hereto to exercise, and no delay in exercising any right, power or
remedy created hereunder, shall operate as a waiver thereof, nor shall any
single or partial exercise of any right, power or remedy by any such party
preclude any other or further exercise thereof or the exercise of any other
right, power or remedy. No waiver by any party hereto to any breach of or
default in any term or condition of this Agreement shall constitute a waiver of
or assent to any succeeding breach of or default in the same or any other term
or condition hereof.
11.7 Headings. The headings of particular provisions of this Agreement
are inserted for convenience only and shall not be construed as a part of this
Agreement or serve as a limitation or expansion on the scope of any term or
provision of this Agreement.
11.8 Number and Gender. Where the context requires, the use of the
singular form herein shall include the plural, the use of the plural shall
include the singular, and the use of any gender shall include any and all
genders.
11.9 Time of Performance. Time is of the essence in the performance of
this Agreement.
11.10 No Third Party Beneficiary. The terms and provisions of this
Agreement are intended solely for the benefit of each party hereto and their
respective successors or permitted assigns, and it is not the intention of the
parties to confer third-party beneficiary rights upon any other Person.
[SIGNATURES TO THIS AGREEMENT ARE ON THE FOLLOWING PAGE]
14
[SIGNATURES TO THIS TRANSFER AGREEMENT]
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
TRANSFEROR:
NORTHWESTERN ENERGY, L.L.C.
By: /s/ Michael J. Hanson
-------------------------------
Name: Michael J. Hanson
Title: President & CEO
TRANSFEREE:
NORTHWESTERN CORPORATION
By: /s/ Eric R. Jacobsen
-------------------------------
Name: Eric R. Jacobsen
Title: Senior Vice President,
General Counsel &
Chief Legal Officer
15
Schedule 2.2
EXCLUDED ASSETS
---------------
1. All of Transferor's right, title and interest in and to all of the assets and
properties included within, or related or appertenant to (i) the Milltown Dam
Project (the "Milltown Dam Project") as described in that certain application
filed by The Montana Power Company on August 30, 1965, as amended on April 8,
1968, for a license under Section 4(e) of the Federal Power Act for constructed
Project No. 2543 known as the Milltown Project (the "Application"); (ii) the
Disposal Area Number 1, which is located on a bluff on the west side of the
Milltown Dam reservoir, just south of the Bonner Tunnel (an abandoned railway
tunnel), where The Montana Power Company deposited sediment removed from
upstream of the Milltown Dam spillway in connection with repairs to the spillway
made in 1986 and 1987; and (iii) the Milltown Rehabilitation Upland Disposal
Area, which is located on the west side of the Milltown Dam reservoir, in the
vicinity of the abandoned Chicago, Milwaukee, St. Paul & Pacific Railroad
tracks, where The Montana Power Company deposited sediment removed from upstream
of the base of the Milltown Dam in connection with repairs to the dam made in
1988 and 1989, including without limitation the following:
a. All lands and interest in lands (i) constituting the Milltown Dam
Project area and enclosed by the project boundary, the limits of which are
otherwise defined, the use and occupancy of which are necessary for the purposes
of the Milltown Dam Project; such Milltown Dam Project area and project boundary
being shown and described by Exhibits J and K: Sheet 1, FPC No. 2543-8 - showing
location of project works and project boundary - which exhibits are attached to
the Application; (ii) constituting the Disposal Area Number 1; (iii)
constituting the Milltown Rehabilitation Upland Disposal Area; and (iv)
constituting additional lands or interests in lands related to the Milltown Dam
Project as included in the descriptions set forth below. A description of such
lands, located in Missoula County, Montana, is, without limiting the generality
of the introductory paragraph or the foregoing general description, set forth on
Appendix A, attached hereto.
b. Milltown Dam Project works consisting of the following:
(i) a dam in four sections: a 244-foot concrete abutment wall, a
152-foot concrete gravity section (maximum height about 45 feet), integral with
the powerhouse, a 52-foot long concrete sluice gate section containing four
steel gates 9 feet by 14 feet and a 216-foot long rock crib spillway beyond the
concrete sluice;
(ii) a reservoir with a capacity of approximately 300 acre-feet at
maximum pond elevation of about 3,260 feet;
(iii) a brick powerhouse containing five units with a total installed
capacity of 3,040 kilowatts;
Schedule 2.2-1
(iv) 2.3 kv bus at the plant; and
(v) appurtenant facilities; the location, nature and character of
which are more specifically shown and described by Exhibit L, Sheet 1, FPC No.
2543-2 (Showing Project plan and elevations), Sheet 2, FPC No. 2543-3 (showing
Powerhouse floor plan), Sheet 3 FPC No. 2543-4 (showing Powerhouse section), and
Sheet 4, FPC No. 2543-5 (showing abutment wall elevation and sections), and
Exhibit M (consisting of two typewritten pages entitled "General Description of
Mechanical, Electrical, and Transmission Equipment, Milltown Project"), which
exhibits were attached to the Application.
c. All other structures, fixtures, equipment or facilities used or
useful in the maintenance and operation of the Milltown Dam Project and located
on the Milltown Dam Project area and all riparian or other rights, the use or
possession of which is necessary or appropriate in the maintenance or operation
of the Milltown Dam Project.
d. The interconnection point (the "Interconnection Point") between the
Milltown Dam Project and the Transferred Assets is that point located on the
utility pole structure lying north of the Montana Rail Link Railroad right of
way, approximately 500 feet north of the Milltown Dam Project, one pole south of
the radial line's intersection with Transferor circuit number 61.
e. Except for the transmission line from the Milltown Dam Project
powerhouse to the Interconnection Point, the Excluded Assets shall not include
any electric or gas transmission or distribution lines or related facilities
which are located on the lands described in Section 1.a. to this Schedule 2.2.
f. All water rights appurtenant to the Milltown Dam Project including
without limitation the following:
(i) Water Right Number 76F 30850 00, Ground Water
Certificate;
(ii) Water Right Number 76F 94407 00, Statement of Claim;
(iii) Water Right Number 76M 94404 00, Statement of Claim;
(iv) Water Right Number 76M 94405 00, Statement of Claim and
(v) Water Right Number 76M 94406 00, Statement of Claim.
2. Transferor's rights as insured under that certain pollution liability
insurance policy, policy number PLS 1952382, provided by America International
Specialty Lines Insurance Company (an AIG group company) covering risk of
significant release of hazardous material with respect to the Milltown Dam.
3. Transferor's rights and obligations under the following agreements: (a) the
Power Purchase Agreement; (b) the Interconnection Agreement; (c) the Secondment
Agreement; (d) that certain Confidential Settlement Agreement and Mutual Release
by and among Atlantic
Schedule 2.2-2
Richfield Company and ARCO Environmental Remediation, LLC and Transferor
effective as of October 18, 2000; (e) the Maintenance and Operating Costs
Support Agreement; (f) the Environmental Liabilities Support Agreement; and (g)
Asset and Stock Transfer Agreement dated as of November 15, 2002, between
Transferor and Transferee and all other agreements to be entered into between
Transferor and Transferee pursuant to such Asset and Stock Transfer Agreement.
4. Transferor's rights, if any (by virtue of its status as successor by merger
to the remaining utility business of The Montana Power Company), to exemption
from liability under the Comprehensive Environmental Responsibility Compensation
and Liability Act of 1980 by virtue of the statutory exemption applicable to the
Milltown Dam under Section 118(g) of the Superfund Amendments and
Reauthorization Act of 1986.
5. Transferor's right, title and interest in and to the Rattlesnake Creek area
property in Missoula County, Montana, more particularly described as follows:
Tract G of Certificate of Survey No. 2689 in the SW 1/4 of Section 2, T13 N - R
19W, Missoula County together with rights appurtenant thereto including without
limitation improvements and water rights, if any, but excluding all electric and
gas transmission and distribution lines and related facilities which are located
on said land.
6. Transferor's rights to file, prosecute and collect claims under the liability
insurance policies set forth on Appendix B, attached hereto as such policies may
relate to the Excluded Liabilities.
7. All documents, papers and records related to the Excluded Assets.
Schedule 2.2-3
APPENDIX A
----------
(TO SCHEDULE 2.2,
EXCLUDED ASSETS)
MILLTOWN DAM PROJECT REAL PROPERTY
MISSOULA COUNTY, MONTANA
FEE LANDS, EASEMENTS AND OTHER INTERESTS
A. FEE LANDS
Parcel I
- --------
That certain piece, parcel or tract of land located in Sections 20, 21,
22, 27, 28 and 34, Township 13 North, Range 18 West, M.P.M., Missoula
County, Montana, and more particularly described as follows, to-wit:
Beginning at the Southwest corner of the E1/2SE1/4NE1/4 of Section 20,
Township 13 North, Range 18 West, M.P.M., and running thence South to
the South line of the NE1/4SE1/4 of said Section 20; thence East along
said South line of the NE1/4SE1/4 of said Section 20 and along the North
line of SW1/4SW1/4 of Section 21, 820 feet more or less to a point where
the North line of the SW1/4SW1/4 of Section 21 intersects the East
right-of-way line of the Chicago, Milwaukee, St. Paul and Pacific
Railroad Company; thence along said East line of said Railroad
right-of-way, across and through the S1/2SW1/4 of Section 21, NW1/4 and
E1/2 of Section 28, 8255 feet, more or less, to the East line of said
Section 28; thence South along the East line of said Section 28, 500
feet, more or less, to the Southeast corner of said Section 28; thence
South along the West line of the NW1/4 of Section 34, 2830 feet, more or
less, to the Southwest corner of the NW1/4 of Section 34; thence East
along the South line of the NW1/4 of Section 34, 2640 feet, more or
less, to the center of said Section 34; thence North along the center
line of Section 34, 920 feet; thence North 73(degree) East, 367 feet;
thence due East 250 feet; North 31(degree) East, 334 feet, more or less
to a point at the high water line on the South bank of the Missoula or
Hellgate River; thence Northwesterly along the South bank of said river,
and following the high water line of said River, on the West and South
banks thereof to the West boundary line of NE1/4 of Section 34; thence
North and across said River, and along the North and South center line
of said Section 34, to the South line of Section 27; thence Easterly
along the South line of said Section 27, 1252 feet; thence North
5(degree)5' West, 370 feet; thence North 23(degree)10' West, 467 feet;
thence North 35(degree)25' West, 250 feet; thence North 8(degree)20'
West, 223 feet; thence North 27(degree)30' West, 124 feet; thence North
44(degree)30' West, 325 feet; thence North 79(degree)30' West, 138 feet;
thence North 30(degree)01' West, 452.9 feet; thence South 53(degree)17'
West, 260 feet, more or less, to the center line of Section 27; thence
Northerly along the center line of said Section 27, to the South
boundary of the Northern Pacific Railway Company right-of-way; thence
Northwesterly and along said right-of-way line and across the NW1/4 of
Section 27, 3260 feet, more or less, to a point, where said right-of-way
line intersects the North line of Section 27; thence Westerly along said
North line of Section 27 and the North line of Section 28, 3220
Schedule 2.2 (Appendix A)-1
feet, more or less, to the Northwest corner of the NE1/4 of Section 28;
thence Northerly along the North and South center line of Section 21,
1850 feet, more or less, to the high water line of the North bank of the
Missoula River; thence Northwesterly and following the high water line
of said River, and along said bank through the NE1/4SW1/4 of Section 21,
to the confluence of the Big Blackfoot River therewith; thence Easterly
and following the high water line of the said Big Blackfoot River, on
the South bank thereof, through the SE1/4NW1/4 of said Section 21 to the
North and South center line of said Section 21; thence Northerly and
across the said Big Blackfoot River and following the East line of the
NW1/4 of Section 21, to the high water line of the North bank of said
Big Blackfoot River; thence Westerly and following the course of the
high water line on the North bank of the Big Blackfoot River, in all its
bends, to a point where said high water line on the North bank
aforesaid, intersects the South right-of-way line of the Northern
Pacific Railway Company in the NW1/4 of Section 21; thence Westerly and
along the said South right-of-way line to the West side line of the
E1/2SE1/4NE1/4 of Section 20; thence Southerly along said last mentioned
line 875 feet, more or less, to the East and West center line of said
Section 20, the point of beginning.
Recording Reference: Book 108 of Deeds at page 583
Parcel II
- ---------
A strip of land 400 feet wide in the Northwest quarter (NW1/4) of
Section 21 and the East half of the Northeast quarter of the Northeast
quarter E1/2NE1/4NE1/4 of Section 20, Township 13 North, Range 18 West,
M.P.M., its outside boundaries being 200 feet on each side of the center
line of the abandoned main track of the Northern Pacific Railway Company
as the same was originally located and staked out across said premises
(and which said center line is now the center line of the track of the
Missoula Street Railway) and extending from the West line of the
E1/2NE1/4NE1/4 of Section 20, Township 13 North, Range 18 West, M.P.M.,
to the high water line of the reservoir located in the SE1/4NW1/4 of
said Section 21, Township 13 North, Range 18 West, M.P.M.
Excepting and reserving therefrom, however, and there is hereby
specifically excepted and reserved therefrom a strip of land 80 feet
wide, being 40 feet on each side of said center line of the abandoned
main track of the Northern Pacific Railway Company as the same was
originally located and staked out across the above described premises,
and now occupied by the Missoula Street Railway .
Recording Reference: Book 126 of Deeds at page 472
Parcel III
- ----------
A strip of land 80 feet wide in the NW1/4 of Section 21 and the
E1/2NE1/4NE1/4 of Section 20, Township 13 North, Range 18 West, M.P.M.,
being 40 feet on each side of the center line of the main track of the
Northern Pacific Railway
Schedule 2.2 (Appendix A)-2
Company as the same was originally located and staked out across said
premises, and extending from a line drawn at right angles to said center
line of the main track at the point of intersection of the original
Southwesterly boundary line of the Northern Pacific Railway Company
right-of-way with the center line of the new main track of said Railway
Company as the same is now constructed; thence over, along and across
the NW1/4 said of Section 21 and the E1/2NE1/4NE1/4 of said Section 20.
Recording Reference: Book 126 of Deeds at page 473
Parcel IV
- ---------
All that portion of the Chicago, Milwaukee, St. Paul and Pacific
Railroad Company's 150 foot wide right-of-way and wye track right-of-way
in the Northwest quarter (NW1/4) and the Northwest quarter of the
Northeast quarter (NW1/4NE1/4) of Section 28 and the Southwest quarter
(SW1/4) of Section 21, the East half of the East half of the Southeast
quarter (E1/2E1/2SE1/4) and the East half of the Southeast quarter of
the Northeast quarter (E1/2SE1/4NE1/4) of Section 20, Township 13 North,
Range 18 West, P.M.M.
EXCEPT that portion in the SE1/4NW1/4 said Section 28 lying
southeasterly of former Railroad Engineer's Station 433+84, as measured
perpendicular and at right angles to the Grantor's former main track
centerline.
Recording Reference: Book 223 of Micro Records at page 564
Parcel V
- --------
The Northwest Quarter (NW1/4) of Section Thirty-four (34), Township
Thirteen (13) North of Range Eighteen (18) West, containing 160 acres.
And also all that portion of the Southwest Quarter of the Northwest
Quarter (SW1/4NW1/4) of Section Twenty-one (21), Township Thirteen (13)
North of Range Eighteen (18) West, Montana Principal Meridian, lying
south of the present used right of way of the Northern Pacific Railway
Company, passing through said Southwest Quarter of the Northwest Quarter
(SW1/4NW1/4).
Recording Reference: Book 126 of Deeds at Page 442
Parcel VI
- ---------
All of Transferor's right, title and interest, if any, in the tracts
described in Certificate of Survey No. 3441 filed in the office of the
Clerk and Recorder of Missoula County, Montana in Book 256, Page 0638.
EXCEPTING from Parcels I, II, III, IV, V and VI the interests conveyed by
the following instruments:
(i) Quitclaim Deed recorded April 30, 1941 in Book 131, Page 77, records of
Missoula County, Montana.
Schedule 2.2 (Appendix A)-3
(ii) Quitclaim Deed recorded April 23, 1963 in Book 228, Page 272, records of
Missoula County, Montana.
(iii) Quitclaim Deed recorded July 2, 1963 in Book 229, Page 335, records of
Missoula County, Montana.
(iv) Bargain and Sale Deed recorded March 18, 1942 in Book 131, Page 427,
records of Missoula County, Montana.
(v) Modification of Reservation of Right to Flood, recorded September 7,
1983 in Book 194, Page 747, records of Missoula County, Montana.
(vi) Bargain and Sale Deed, recorded June 11, 1942 in Book 131, Page 504,
records of Missoula County, Montana.
(vii) Correction Deed recorded April 12, 1983 in Book 186, Page 2233, records
of Missoula County, Montana.
B. EASEMENTS
Easements granted or reserved to The Montana Power Company, or its predecessors
in interest, or otherwise described, in the following-described instruments, for
the right to flood and other purposes, but only to the extent such easements are
used or held for use in connection with the operation of the Milltown Dam
Project:
- ------------------------ ------------------ --------------------- --------- ----
Grantor Grantee Recorded Book Page
- ------------------------ ------------------ --------------------- --------- ----
Big Blackfoot Milling Clark-Montana October 19, 1906 37 217
Company Realty Company
- ------------------------ ------------------ --------------------- --------- ----
Missoula Public Service The Montana Power December 20, 1929 108 583
Company Company
- ------------------------ ------------------ --------------------- --------- ----
The Montana Power Luke M. Harris March 18, 1942 131 427
Company
- ------------------------ ------------------ --------------------- --------- ----
The Montana Power John Ray Teague June 11, 1942 131 504
Company
- ------------------------ ------------------ --------------------- --------- ----
Anaconda Copper Mining The Montana Power November 30, 1942 131 625
Company Company
- ------------------------ ------------------ --------------------- --------- ----
The Montana Power Jack L. Green, II April 12, 1983 186 2233
Company
- ------------------------ ------------------ --------------------- --------- ----
The Montana Power Ralph Roy Harris September 7, 1983 194 747
Company and June Harris
- ------------------------ ------------------ --------------------- --------- ----
Champion The Montana June 6, 1986 241 0932
- ------------------------ ------------------ --------------------- --------- ----
Schedule 2.2 (Appendix A)-4
- ------------------------ ------------------ --------------------- --------- ----
International Power Company
Corporation
- ------------------------ ------------------ --------------------- --------- ----
C. OTHER RIGHTS IN REAL PROPERTY
-----------------------------
All other rights and interests in real property owned by Transferor within the
boundary of the Milltown Dam Project which are used or held for use in
connection with the Milltown Dam Project and all other real property rights and
interests used or held for use in connection with the Milltown Dam Project.
Schedule 2.2 (Appendix A)-5
APPENDIX B
----------
(TO SCHEDULE 2.2,
EXCLUDED ASSETS)
POLICY POLICY
NUMBER PERIOD POLICY LIMITS IN EXCESS OF INSURER
------ ------ ------------- ------------ -------
Unknown 00/00/1914 $30,000 Unknown
Unknown 00/00/1915 $30,000 Unknown
Unknown 00/00/1916 $30,000 Unknown
Unknown 01/30/26 to 01/30/27 Unknown Electric Bond & Share
Unknown 01/30/27 to 01/30/28 Unknown Electric Bond & Share
A5725/A5726 06/01/28 to 01/30/29 Unknown Lloyds
James D. Mitchell
Lane Powell Spears Lubersky
1420 Fifth Avenue
Seattle, WA 98101-2338
C/NP 7960 & 5719/5720 00/00/29 to 00/00/30 $200,000 Lloyds
CINP8124TL2 00/00/30 to 00/00/31 $200,000 Lloyds
CN9905 00/00/31 to 00/00/32 $200,000 --------- Lloyds
A7491 00/00/32 to 00/00/33 $200,000 Lloyds
A7816 00/00/32 to 00/00/33 $200,000 Lloyds
Schedule 2.2 (Appendix B)-1
POLICY POLICY
NUMBER PERIOD POLICY LIMITS IN EXCESS OF INSURER
------ ------ ------------- ------------ -------
A8181 12/31/34 to 12/31/35 $200,000 Underlying Lloyds
A8753 12/31/35 to 12/31/36 $200,000 Underlying Lloyds
A9353 (CHNGD TO A1818) 12/31/36 to 12/31/37 $200,000 Underlying Lloyds
A4499 12/31/37 to 12/31/38 $200,000 Underlying Lloyds
8492 12/31/38 to 12/31/39 $200,000 Underlying Lloyds
12841 12/31/39 to 12/31/40 $200,000 Underlying Lloyds
17005 12/31/40 to 12/31/41 $200,000 Underlying Lloyds
20990 12/31/41 to 12/31/42 $200,000 Underlying Lloyds
12/31/42 to 12/31/43
39104 12/31/43 to 12/31/44 $200,000 $5,000 Lloyds
39105 12/31/43 to 12/31/44 $300,000 $205,000 Lloyds
39106 12/31/43 to 12/31/44 $500,000 $505,000 Lloyds
39107 12/31/43 to 12/31/44 $1,000,000 $1,005,000 Lloyds
43843 12/31/44 to 12/31/45 $200,000 $5,000 Lloyds
43844 12/31/44 to 12/31/45 $300,000 $205,000 Lloyds
Schedule 2.2 (Appendix B)-2
POLICY POLICY
NUMBER PERIOD POLICY LIMITS IN EXCESS OF INSURER
------ ------ ------------- ------------ -------
43845 12/31/44 to 12/31/45 $500,000 $505,000 Lloyds
43846 12/31/44 to 12/31/45 $1,000,000 $1,005,000 Lloyds
48416 12/31/45 to 12/31/46 $200,000 $5,000 Lloyds
48417 12/31/45 to 12/31/46 $300,000 $205,000 Lloyds
48418 12/31/45 to 12/31/46 $500,000 $505,000 Lloyds
48419 12/31/45 to 12/31/46 $1,000,000 $1,005,000 Lloyds
53726 12/31/46 to 12/31/47 $200,000 $5,000 Lloyds
53727 12/31/46 to 12/31/47 $300,000 $205,000 Lloyds
53728 12/31/46 to 12/31/47 $500,000 $505,000 Lloyds
53729 12/31/46 to 12/31/47 $1,000,000 $1,005,000 Lloyds
59976 12/31/47 to 12/31/48 $200,000 $5,000 Lloyds
59977 12/31/47 to 12/31/48 $300,000 $205,000 Lloyds
59978 12/31/47 to 12/31/48 $500,000 $505,000 Lloyds
59979 12/31/47 to 12/31/48 $1,000,000 $1,005,000 Lloyds
K87455 12/31/48 to 12/31/49 $200,000 $5,000 Lloyds
K67456 12/31/48 to 12/31/49 $300,000 $205,000 Lloyds
K87457 12/31/48 to 12/31/49 $500,000 $505,000 Lloyds
K87458 12/31/48 to 12/31/49 $1,000,000 $1,005,000 Lloyds
Schedule 2.2 (Appendix B)-3
POLICY POLICY
NUMBER PERIOD POLICY LIMITS IN EXCESS OF INSURER
------ ------ ------------- ------------ -------
K75890 12/31/49 to 12/31/50 $200,000 $5,000 Lloyds
K75891 12/31/49 to 12/31/50 $300,000 $205,000 Lloyds
K75892 12/31/49 to 12/31/50 $500,000 $505,000 Lloyds
K75893 12/31/49 to 12/31/50 $1,000,000 $1,005,000 Lloyds
K5270 12/31/50 to 12/31/51 $200,000 $5,000 Lloyds
K5271 12/31/50 to 12/31/51 $300,000 $205,000 Lloyds
K5272 12/31/50 to 12/31/51 $500,000 $505,000 Lloyds
K5273 12/31/50 to 12/31/51 $1,000,000 $1,005,000 Lloyds
K8111 06/20/51 to 6/30/52 $90,000 $10,000 Lloyds
K10560 12/31/51 to 12/31/52 $200,000 $100,000 Lloyds
K10561 12/31/51 to 12/31/52 $300,000 $300,000 Lloyds
K10562 12/31/51 to 12/31/52 $500,000 $600,000 Lloyds
K10563 12/31/51 to 12/31/52 $1,000,000 $1,100,000 Lloyds
K10564 12/31/51 to 12/31/52 $1,000,000 $2,100,000 Lloyds
K12865 06/30/52 to 06/30/53 $90,000 $10,000 Lloyds
K15520 12/31/52 to 12/31/53 $200,000 $100,000 Lloyds
K15521 12/31/52 to 12/31/53 $300,000 $300,000 Lloyds
K15522 12/31/52 to 12/31/53 $500,000 $600,000 Lloyds
K15523 12/31/52 to 12/31/53 $1,000,000 $1,100,000 Lloyds
Schedule 2.2 (Appendix B)-4
POLICY POLICY
NUMBER PERIOD POLICY LIMITS IN EXCESS OF INSURER
------ ------ ------------- ------------ -------
K15524 12/31/52 to 12/31/53 $1,000,000 $1,100,000 Lloyds
K19751 06/30/53 to 06/30/54 $90,000 $10,000 Lloyds
K21940 12/31/53 to 12/31/54 $200,000 $100,000 Lloyds
K21941 12/31/53 to 12/31/54 $300,000 $300,000 Lloyds
K21942 12/31/53 to 12/31/54 $500,000 $600,000 Lloyds
K21943 12/31/53 to 12/31/54 $1,000,000 $1,100,000 Lloyds
K21944 12/31/53 to 12/31/54 $1,000,000 $2,100,000 Lloyds
K21945 12/31/53 to 12/31/54 $1,000,000 $3,100,000 Lloyds
K21946 12/31/53 to 12/31/54 $1,000,000 $4,100,000 Lloyds
K25300 06/30/54 to 08/31/55 $1,000,000 $4,010,000 Lloyds
K28230 12/31/54 to 12/31/55 $200,000 $100,000 Lloyds
K28231 12/31/54 to 12/31/55 $300,000 $300,000 Lloyds
K28232 12/31/54 to 12/31/55 $500,000 $600,000 Lloyds
K28233 12/31/54 to 12/31/55 $1,000,000 $1,100,000 Lloyds
K28234 12/31/54 to 12/31/55 $1,000,000 $2,100,000 Lloyds
K28235 12/31/54 to 12/31/55 $1,000,000 $3,100,000 Lloyds
K28236 12/31/54 to 12/31/55 $1,000,000 $4,100,000 Lloyds
100341 (renewal of K25300) 08/31/55 to 06/30/56 $90,000 $10,000 Lloyds
Schedule 2.2 (Appendix B)-5
POLICY POLICY
NUMBER PERIOD POLICY LIMITS IN EXCESS OF INSURER
------ ------ ------------- ------------ -------
K34550 12/31/55 to 12/31/56 $200,000 $100,000 Lloyds
K34551 12/31/55 to 12/31/56 $300,000 $300,000 Lloyds
K34552 12/31/55 to 12/31/56 $500,000 $600,000 Lloyds
K34553 12/31/55 to 12/31/56 $1,000,000 $1,100,000 Lloyds
K34554 12/31/55 to 12/31/56 $1,000,000 $2,100,000 Lloyds
K34555 12/31/55 to 12/31/56 $1,000,000 $3,100,000 Lloyds
K34556 12/31/55 to 12/31/56 $1,000,000 $4,100,000 Lloyds
K38616 06/30/56 to 06/30/57 $90,000 $10,000 Lloyds
104205 10/10/56 to 12/31/56 $50,000 $50,000 Lloyds
K41170 12/31/56 to 12/31/57 $200,000 $50,000 Lloyds
K41171 12/31/56 to 12/31/57 $300,000 $250,000 Lloyds
K41172 12/31/56 to 12/31/57 $500,000 $550,000 Lloyds
K41173 12/31/56 to 12/31/57 $1,000,000 $1,050,000 Lloyds
K41174 12/31/56 to 12/31/57 $1,000,000 $2,050,000 Lloyds
K41175 12/31/56 to 12/31/57 $1,000,000 $3,050,000 Lloyds
K41176 12/31/56 to 12/31/57 $1,000,000 $4,050,000 Lloyds
K41177 12/31/56 to 12/31/57 $5,000,000 $5,050,000 Lloyds
LIA 1047 12/31/56 to 12/31/57 $10,000,000 $500,000 Lloyds
L828-229 01/11/57 to 01/11/58 $50,000 Unknown Lloyds
Schedule 2.2 (Appendix B)-6
POLICY POLICY
NUMBER PERIOD POLICY LIMITS IN EXCESS OF INSURER
------ ------ ------------- ------------ -------
K44806 06/30/57 to 06/30/58 $40,000 $10,000 Lloyds
K47070 12/31/57 to 12/31/58 $200,000 $50,000 Lloyds
K47071 12/31/57 to 12/31/58 $300,000 $250,000 Lloyds
K47072 12/31/57 to 12/31/58 $1,500,000 $550,000 Lloyds
K47073 12/31/57 to 12/31/58 $2,000,000 $2,050,000 Lloyds
K47074 12/31/57 to 12/31/58 $1,000,000 $4,050,000 Lloyds
K47075 12/31/57 to 12/31/58 $5,000,000 $5,050,000 Lloyds
L829-125 01/11/58 to 01/11/59 $50,000 Unknown Northern Assurance Company
K49517 01/07/58 to 01/07/61 $500,000 Unknown Lloyds
K53120 12/31/58 to 12/31/59 $200,000 $50,000 Lloyds
K53121 12/31/58 to 12/31/59 $300,000 $250,000 Lloyds
K53122 12/31/58 to 12/31/59 $1,500,000 $550,000 Lloyds
K53123 12/31/58 to 12/31/59 $2,000,000 $2,050,000 Lloyds
K53124 12/31/58 to 12/31/59 $1,000,000 $4,050,000 Lloyds
K53125 12/31/58 to 12/31/59 $5,000,000 $5,050,000 Lloyds
K51040 06/30/58 to 06/30/59 $40,000 $10,000 Lloyds
56816 06/30/59 to 06/30/60 $40,000 $10,000 Lloyds
K58961 12/31/59 to 12/31/60 $200,000 $50,000 Lloyds
Schedule 2.2 (Appendix B)-7
POLICY POLICY
NUMBER PERIOD POLICY LIMITS IN EXCESS OF INSURER
------ ------ ------------- ------------ -------
K58962 12/31/59 to 12/31/60 $300,000 $250,000 Lloyds
K58963 12/31/59 to 12/31/60 $1,500,000 $550,000 Lloyds
K58964 12/31/59 to 12/31/60 $2,000,000 $2,050,000 Lloyds
K58965 12/31/59 to 12/31/60 $1,000,000 $4,050,000 Lloyds
K58966 12/31/59 to 12/31/60 $5,000,000 $5,050,000 Lloyds
K65070 12/31/60 to 12/31/61 $200,000 $50,000 Lloyds
K65071 12/31/60 to 12/31/61 $300,000 $250,000 Lloyds
K65072 12/31/60 to 12/31/61 $1,500,000 $550,000 Lloyds
K65073 12/31/60 to 12/31/61 $2,000,000 $2,050,000 Lloyds
K65074 12/31/60 to 12/31/61 $1,000,000 $4,050,000 Lloyds
K65075 12/31/60 to 12/31/61 $5,000,000 $5,050,000 Lloyds
K70600 31/01/62 to 12/31/62 $200,000 $50,000 Lloyds
K70601 12/31/61 to 12/31/62 $300,000 $210,000 Lloyds
K70602 12/31/61 to 12/31/62 $1,500,000 $510,000 Lloyds
K70603 12/31/61 to 12/31/62 $3,000,000 $2,010,000 Lloyds
K70604 12/31/61 to 12/31/62 $5,000,000 $5,010,000 Lloyds
K75420 12/31/62 to 12/31/63 $200,000 $10,000 Lloyds
Unknown 12/31/62 to 12/31/63 $300,000 $210,000 Lloyds
K75421 12/31/62 to 12/31/63 $1,500,000 $510,000 Lloyds
Schedule 2.2 (Appendix B)-8
POLICY POLICY
NUMBER PERIOD POLICY LIMITS IN EXCESS OF INSURER
------ ------ ------------- ------------ -------
K75422 12/31/62 to 12/31/63 $3,000,000 $2,010,000 Lloyds
K75423 12/31/62 to 12/31/63 $5,000,000 $5,010,000 Lloyds
K75424 12/31/62 to 12/31/63 $5,000,000 $10,010,000 Lloyds
K77900 12/31/63 to 12/31/64 $1,000,000 $10,000 Lloyds
CU3020 12/31/63 to 12/31/64 $4,000,000 $1,010,000 Lloyds
CU3021 12/31/63 to 12/31/64 $15,000,000 $5,010,000 Lloyds
EDR 1680 01/11/64 to 01/11/67 $50,000 $0 Lloyds
RD 9910444 01/01/64 to 01/01/67 $4,000,000 $50,000 Continental Casualty (CNA)
Attn: Janet Owens
1 Continental Drive
Cranbury, NJ 08570
M7552-0002 01/01/64 to 01/01/67 $3,000,000 $4,050,000 American Reinsurance Company
X-3334 01/01/64 to 01/01/67 $3,000,000 $4,050,000 General Reinsurance Company
LIA L-194 (K15700) 12/31/66 to 12/31/69 $1,000,000 Underlying Lloyds
LIA L-195 (CU7202) 12/31/66 to 12/31/69 $4,000,000 $1,000,000 Lloyds
LIA L-196 (CU7203) 12/31/66 to 1/3/70 $10,000,000 $5,000,000 Lloyds
39519 01/03/66 to 01/03/69 $5,000,000 $10,050,000 Lloyds
EDR 1772 01/11/67 to 01/11/70 $50,000 $250 Lloyds
LIA L-1052 (K22700) 12/31/69 to 12/31/72 $1,000,000 $50,000 Lloyds
Schedule 2.2 (Appendix B)-9
POLICY POLICY
NUMBER PERIOD POLICY LIMITS IN EXCESS OF INSURER
------ ------ ------------- ------------ -------
LIA C1053 (CX2900) 12/31/69 to 12/31/72 $4,000,000 $1,050,000 Lloyds
LIA C1054 (CU7203) (CU2901) 12/31/69 to 12/31/72 $10,000,000 $5,050,000 Lloyds
HEC-4356688 12/31/72 to 12/31/75 $10,000,000 $50,000 The Home Insurance Co.
B7904 12/31/72 to 12/31/75 $15,000,000 $10,050,000 Lloyds
M76685 01/01/73 to 01/01/76 $5,000,000 $10,050,000 Mission Ins. Co.
030 03/03/76 to 03/03/81 $1,000,000 $100,000 Gas, Ltd.
P.O. Box 1031
Jersey City, NJ 07302
UGL1330 12/31/75 to 12/31/76 $1,000,000 $260,000 Lloyds
UGL1331 12/31/75 to 12/31/76 $1,500,000 $1,000,000 Lloyds
UGL1332 12/31/75 to 12/31/76 $2,500,000 $2,500,000 Lloyds
UGL1333 12/31/75 to 12/31/76 $15,000,000 $5,000,000 Lloyds
M831489 01/01/76 to 12/31/76 $5,000,000 $10,050,000 Mission National Insurance
P. O. Box 60004
Los Angeles, CA 90060
TB8424 (L&C1412) 03/03/76 to 12/31/78 $9,000,000 $1,100,000 Lloyds
UGL1331 12/31/76 to 12/31/77 $1,500,000 $1,100,000 Lloyds
UGL1332 12/31/76 to 12/31/77 $2,500,000 $2,500,000 Lloyds
UGL1333 12/31/76 to 12/31/77 $15,000,000 $5,000,000 Lloyds
Schedule 2.2 (Appendix B)-10
POLICY POLICY
NUMBER PERIOD POLICY LIMITS IN EXCESS OF INSURER
------ ------ ------------- ------------ -------
M834020 12/31/76 to 12/31/77 $5,000,000 $10,100,000 Mission
UGL1331 12/31/77 to 12/31/78 $1,500,000 $1,000,000 Lloyds
UGL1332 12/31/77 to 12/31/78 $2,500,000 $2,500,000 Lloyds
UGL1333 12/31/77 to 12/31/78 $15,000,000 $5,000,000 Lloyds
M839436 12/31/77 to 12/31/78 $5,000,000 $10,100,000 Mission
M848202 12/31/78 to 03/03/80 $5,000,000 $10,500,000 Mission
H86090 03/03/80 to 03/03/81 $15,000,000 $10,500,000 Mr. Terry C. Allen
Holland America Insurance
Craft Fridkin & Rhyne
310 Monroe
Jefferson City, MO 65102
030A 03/03/81 to 03/03/82 $10,000,000 $500,000 AEGIS
Harborside Financial Center
700 Plaza Two
Jersey City, NJ 07311-3994
H89897 03/03/81 to 03/03/82 $15,000,000 $10,500,000 Holland America
TXX111318 03/03/82 to 03/03/83 $9,500,000 $500,000 Excess Claim Handling
Office (Echo)
Twin City Fire
P. O. Box 1827
Avon, Ct 06001
H92678 03/03/82 to 03/03/83 $15,000,000 $10,500,000 Holland America
Schedule 2.2 (Appendix B)-11
POLICY POLICY
NUMBER PERIOD POLICY LIMITS IN EXCESS OF INSURER
------ ------ ------------- ------------ -------
TXX111322 03/03/83 to 03/03/84 $9,500,000 $500,000 Twin City Fire
H95354 03/03/83 to 03/03/84 $15,000,000 $10,000,000 Holland America
TXX111323 03/03/83 to 03/03/84 $2,500,000 $25,000,000 Twin City Fire
CNU5006618 03/03/84 to 03/03/85 $1,000,000 $500,000 Central National Insurance
105 South 17th Street
Omaha, NE 68102
MNO31725 03/03/84 to 03/03/85 $4,000,000 $1,500,000 Mission
XL208112 03/03/84 to 03/03/85 $5,000,000 $5,500,000 Integrity Insurance Co
Mack Centre Drive
Paramus, NJ 07652
41252 03/03/84 to 09/01/85 $10,000,000 $10,500,000 Highlands Insurance Company
10370 Richmond Avenue
Houston, TX 77042-4123
9605686 03/03/84 to 09/01/85 $5,000,000 $10,500,000 National Union Fire Insurance
70 Pine Street - 18th Floor
New York, NY 10270
327CNJ 09/01/85 to 09/01/86 $20,000,000 $2,000,000 AEGIS
XL327A86 09/01/86 to 09/01/87 $20,000,000 $2,000,000 AEGIS
XL327A87 09/01/87 to 09/01/88 $20,000,000 $2,000,000 AEGIS
Schedule 2.2 (Appendix B)-12
POLICY POLICY
NUMBER PERIOD POLICY LIMITS IN EXCESS OF INSURER
------ ------ ------------- ------------ -------
XL0327A88 09/01/88 to 09/01/89 $25,000,000 $2,000,000 AEGIS
5567242 09/01/88 to 09/01/89 $10,000,000 $27,000,000 Lexington Insurance Company
200 State Street
Boston, MA 02109
X0030A1A89 09/01/89 to 09/09/90 $35,000,000 $2,000,000 AEGIS
X0030A1A90 09/01/90 to 09/09/91 $35,000,000 $2,000,000 AEGIS
X0030A1A91 09/01/91 to 09/09/92 $35,000,000 $2,000,000 AEGIS
X0030A1A92 09/01/92 to 09/09/93 $35,000,000 $2,000,000 AEGIS
X0030A1A93 09/01/93 to 09/01/94 $35,000,000 $2,000,000 AEGIS
X0030A1A94 09/01/94 to 09/01/95 $35,000,000 $2,000,000 AEGIS
X0030A1A95 09/01/95 to 09/01/96 $35,000,000 $2,000,000 AEGIS
CLM310-20-03 09/01/95 to 09/01/96 $10,000,000 $35,000,000 National Union Fire Insurance
Co of Pitt, PA
X0030A1A96 09/01/96 to 06/01/97 $35,000,000 $2,000,000 AEGIS
CLM310-20-14 09/01/96 to 06/01/97 $10,000,000 $35,000,000 National Union Fire Insurance
Co of Pitt, PA
BE309-92-93 06/01/97 to 09/01/98 $50,000,000 $2,000,000 National Union Fire Insurance
Co of Pitt, PA
Schedule 2.2 (Appendix B)-13
POLICY POLICY
NUMBER PERIOD POLICY LIMITS IN EXCESS OF INSURER
------ ------ ------------- ------------ -------
BE9329643 09/01/98 to 09/01/99 $50,000,000 $2,000,000 National Union Fire Insurance
Co of Pitt, PA
BE9329674 09/01/99 to 12/31/01 $50,000,000 $2,000,000 National Union Fire Insurance
Co of Pitt, PA
BE1392839 12/31/01 to 12/31/02 $25,000,000 $2,000,000 National Union Fire Insurance
Co of Pitt, PA
8121-98080E SEA 02/15/02 to 02/15/08 $10,000,000 Federal Insurance Company
(Chubb)
279-50-03 02/15/02 to 02/15/08 $25,000,000 National Union Fire Insurance
Company of Pittsburgh, PA (AIG)
D0030A1A99 02/15/02 to 02/15/08 $35,000,000 Associated Electric & Gas
Insurance Services
Limited (AEGIS)
NDA0155398-99H 02/15/02 to 02/15/08 $15,000,000 $35,000,000 Twin City Fire Insurance
Company
(Hartford)
8141-60-17B 02/15/02 to 02/15/08 $25,000,000 $50,000,000 Federal Insurance Company
(Chubb)
213-97-97 02/15/02 to 02/15/08 $25,000,000 $75,000,000 National Union Fire Insurance
Company of Pittsburgh, PA (AIG)
D-626A100 06/01/00 to 06/01/03 $35,000,000 Associated Electric & Gas
Insurance Services
Limited (AEGIS)
900588-00DO 06/01/00 to 06/01/03 $25,000,000 Energy Insurance Mutual Limited
Schedule 2.2 (Appendix B)-14
Schedule 2.4
EXCLUDED LIABILITIES
--------------------
1. All liabilities and obligations relating to the Excluded Assets, including,
but not limited to, Environmental Liabilities relating thereto.
2. All liabilities and obligations under the following written notices of PRP
liability under Environmental Laws: (a) PRP notice issued by US EPA relating to
the Milltown Dam issued September 27, 1985; and (b) PRP notice issued by US EPA
in 1991 relating to the Butte Priority Soil Operable Unit Superfund Site.
3. All liabilities and obligations relating to claims, causes of action,
judgments and settlements relating to the following matters (collectively, the
"Excluded Litigation"):
a. Baker Revocable Trust v. MPC, et al. - (D. MT. Billings Div.) filed
December 7, 2000.
b. Peterson Investments, Inc., et al. v. MPC, DV-01-55 (20th Judicial
Dist., Lake Cty., MT) filed but not served.
c. Single Moms, Inc. v. Montana Power Company, NorthWestern, et al.,
2:2001cv00046 (D. MT) filed 5/31/2001.
d. Buckingham and Moran v. Touch America Holdings, Inc. et al., (D. MT).
4. All liabilities and obligations as a result of third party claims, causes of
action, judgments or settlements arising out of, resulting from or in connection
with the Excluded Litigation, including, without limitation, any officer and
director indemnification claims.
5. Any and all liabilities and obligations to those officers and directors who
were officers and directors of The Montana Power Company or Transferor (then
known as The Montana Power, LLC) on or prior to February 13, 2002, but who are
no longer officers or directors of Transferor.
Schedule 2.4-1
EXHIBIT A
---------
BILL OF TRANSFER AND ASSIGNMENT
THIS BILL OF TRANSFER AND ASSIGNMENT ("Bill of Transfer and Assignment")
is executed and delivered as of this 15th day of November 2002, by and between
NORTHWESTERN ENERGY, L.L.C, a Montana limited liability company ("Transferor")
and NORTHWESTERN CORPORATION, a Delaware corporation ("Transferee").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, pursuant to that certain Asset and Stock Transfer Agreement
dated as of November 15, 2002 by and between Transferor and Transferee (the
"Transfer Agreement"), Transferor has agreed to transfer and assign to
Transferee substantially all of the assets and properties of Transferor; and
WHEREAS, the parties now desire to carry out the intent and purpose of
the Transfer Agreement by Transferor's execution and delivery to Transferee of
this Bill of Transfer and Assignment, in addition to such other instruments as
Transferee shall have otherwise received or may hereafter request in accordance
with the terms hereof and the Transfer Agreement, evidencing the vesting in
Transferee of the assets and properties of Transferor hereafter described;
NOW, THEREFORE, for and in consideration of the premises and the
consideration provided in the Transfer Agreement, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Transferor hereby conveys, grants, bargains, sells, transfers,
sets over, delivers and assigns unto Transferee, its successors and assigns
forever, all of Transferor's right, title and interest in and to all the assets
and properties of Transferor, of any nature and description, tangible and
intangible, whether or not reflected on the books of Transferor, except for the
Excluded Assets (the "Transferred Assets"). The transfer of the Transferred
Assets hereunder is, to the extent applicable, expressly made subject to that
certain Mortgage and Deed of Trust, dated as of October 1, 1945, from Transferor
(as successor to MPC) to the Bank of New York (successor Corporate Trustee) and
Douglas J. MacInnes (successor Co-trustee), as Trustees, as supplemented and
amended (the "First Mortgage"), and upon such terms as fully to preserve and in
no respect impair the lien or security of the First Mortgage.
TO HAVE AND TO HOLD all the Transferred Assets unto Transferee for its
own use and behoof forever.
1. Capitalized terms not otherwise defined herein shall have the meaning
ascribed thereto in the Transfer Agreement.
2. Notwithstanding anything herein to the contrary, Transferor is not
transferring to Transferee, and the Transferred Assets shall not include, the
Excluded Assets.
Exhibit A-1
3. Transferor hereby constitutes and appoints Transferee as Transferor's
true and lawful attorney and attorneys, with full power of substitution, in
Transferor's name and stead, by, on behalf of, and for the benefit of
Transferor, to demand and receive any and all of the rights, titles, interests,
assets and properties transferred hereunder and to give receipts and releases
for and in respect of the same, and any part thereof, and from time to time to
institute and prosecute in Transferor's name or otherwise, at the expense and
for the benefit of Transferee, any and all proceedings at law, in equity or
otherwise, which Transferee, may deem proper for the collection or reduction to
possession of any of the Transferred Assets or for the collection and
enforcement of any claim or right of any kind hereby sold, conveyed,
transferred, assigned and delivered, or intended so to be, and to do all acts
and things in relation to the Transferred Assets which Transferee shall deem
desirable. Transferor hereby declares that the foregoing powers are coupled with
an interest and are and shall be irrevocable by Transferor in any manner or for
any reason whatsoever.
4. Transferor shall do, execute, acknowledge and deliver, or cause to be
done, executed, acknowledged and delivered, all such further acts, deeds,
assignments, transfers, assumptions, conveyances, powers of attorney, receipts,
acknowledgements, acceptances, assurances and other documents as may be
necessary or convenient to procure for Transferee, and its successors and
assigns, for aiding and assisting in collecting and reducing to possession, or
for vesting and perfecting in Transferee title to, any and all of the
Transferred Assets, as Transferee shall reasonably require.
5. If there are restrictions (the "Restrictions") on the transfer of any
of the Transferred Assets (other than Transferred Assets constituting insurance
policies and rights to coverage under insurance policies now or at any time
obtained by Transferor or any of its predecessor entities ("Insurance
Coverage")), including without limitation those consisting of any required
consents, approvals or other actions of or by third parties or governmental
entities, which must be satisfied, removed, obtained or waived in advance of
transfer and which have not been satisfied, removed, obtained or waived as of
the date hereof (such property, excluding Insurance Coverage, being the
"Restricted Property"), then notwithstanding any other provision in this Bill of
Transfer and Assignment, no right, title or interest in the Restricted Property
shall be transferred by this Bill of Transfer and Assignment and the Restricted
Property shall be subject to the Master Back-to-Back Agreement between
Transferor and Transferee dated as of the date hereof. When and if the
Restrictions with respect to any portion of the Restricted Property are
satisfied, removed, obtained, waived or no longer apply, the transfer of such
portion of the Restricted Property shall automatically become effective, as of
the date hereof to the extent permitted by law and any applicable contractual
provisions, and without further action of either party hereto. The provisions of
this Section 5 shall not apply to or limit the transfer of Insurance Coverage,
the transfer of which is intended to be effective immediately.
6. This Bill of Transfer and Assignment shall be binding upon Transferor
and Transferee, and their respective successors and assigns.
Exhibit A-2
7. This Bill of Transfer and Assignment shall be governed by and
construed and enforced in accordance with the internal laws of the State of New
York, determined without reference to principles of conflicts of laws.
8. This Bill of Transfer and Assignment is delivered pursuant to and is
subject to the Transfer Agreement. In the event of any conflict between the
Transfer Agreement and this Bill of Transfer and Assignment, the terms of the
Transfer Agreement shall prevail.
[SIGNATURES TO THIS BILL OF TRANSFER AND ASSIGNMENT
ARE ON THE FOLLOWING PAGE]
Exhibit A-3
[SIGNATURES TO THIS BILL OF TRANSFER AND ASSIGNMENT]
IN WITNESS WHEREOF, the parties hereto have caused this Bill of Transfer
and Assignment to be executed by their duly authorized officers and their seals
to be affixed, as of the date and year first above written.
TRANSFEROR:
NORTHWESTERN ENERGY, L.L.C.
[SEAL]
______________________________
By: _______________________
Title: _______________________
ATTEST:
Secretary/Assistant Secretary
STATE OF MONTANA )
)ss:
County of Silver Bow )
This instrument was acknowledged before me on _________________________,
2002, by ________________________________________________ [Name(s) of Person(s)]
as _________________________________________ [Type of Authority, e.g., officer,
trustee, partner, attorney-in-fact] of NORTHWESTERN ENERGY, L.L.C.
_________________________________
[Signature of Notary]
_________________________________
[Printed Name of Notary]
Notary Public for the State of Montana,
Residing at _______________________ [City of Residence]
My commission expires: ____________________ 20__
Exhibit A-4
TRANSFEREE:
NORTHWESTERN CORPORATION
[CORPORATE SEAL]
______________________________
By: _______________________
Title: _______________________
ATTEST:
_________________________________
Secretary/Assistant Secretary
STATE OF MONTANA )
)ss:
County of Silver Bow )
This instrument was acknowledged before me on _________________________,
2002, by ________________________________________________ [Name(s) of Person(s)]
as _________________________________________ [Type of Authority, e.g., officer,
trustee, partner, attorney-in-fact] of NORTHWESTERN CORPORATION
_________________________________
[Signature of Notary]
_________________________________
[Printed Name of Notary]
Notary Public for the State of Montana,
Residing at _______________________ [City of Residence]
My commission expires: ____________________ 20__
Exhibit A-5
EXHIBIT B
---------
MASTER ASSUMPTION AGREEMENT
THIS MASTER ASSUMPTION AGREEMENT is executed and delivered as of this
15th day of November, 2002, by and between NORTHWESTERN ENERGY, L.L.C., a
Montana limited liability company ("Transferor") and NORTHWESTERN CORPORATION, a
Delaware corporation ("Transferee").
W I T N E S S E T H :
- - - - - - - - - -
WHEREAS, Transferor and Transferee entered into that certain Asset and
Stock Transfer Agreement dated as of November 15, 2002 (the "Transfer
Agreement"), providing for the transfer and assignment of substantially all of
the assets and properties of Transferor to Transferee; and
WHEREAS, all of the instruments, documents and agreements required to be
executed and delivered in order to consummate the transactions provided in the
Transfer Agreement are being executed and delivered by and to the respective
parties to the Transfer Agreement concurrently herewith:
NOW, THEREFORE, in consideration of the premises and the transfer by
Transferor concurrently herewith of substantially all of the assets and
properties of Transferor in accordance with and pursuant to the Transfer
Agreement, Transferee hereby agrees as follows:
1. Capitalized terms not otherwise defined herein shall have the
meanings ascribed thereto in the Transfer Agreement.
2. Transferee hereby assumes and agrees to pay, perform and discharge
the Assumed Liabilities, as and when the same become due or are required to be
performed or discharged and to perform and observe each of the terms, covenants,
conditions and provisions of the Assumed Liabilities to be performed or observed
by Transferor when and as the same are required to be performed or observed.
3. Transferee further covenants and agrees with Transferor that
Transferee will do, execute and deliver, or will cause to be done, executed and
delivered, all such further instruments, documents, agreements and assurances as
may be requested by Transferor, or which may be necessary or desirable, in order
to evidence and provide for the specific assumption by Transferee of any one or
more or all of the Assumed Liabilities.
Exhibit B-1
4. This Master Assumption Agreement shall be governed by and construed
and enforced in accordance with the internal laws of the State of New York,
determined without reference to principles of conflicts of laws.
[SIGNATURES TO THIS MASTER ASSUMPTION AGREEMENT
ARE ON THE FOLLOWING PAGE]
Exhibit B-2
[SIGNATURES TO THIS MASTER ASSUMPTION AGREEMENT]
IN WITNESS WHEREOF, the parties hereto have caused this Master
Assumption Agreement to be duly executed by their duly authorized officers, and
their seals to be affixed hereto, as of the date first above written.
TRANSFEROR:
NORTHWESTERN ENERGY, L.L.C.
[SEAL]
__________________________________
By: ___________________________
Title: ___________________________
ATTEST:
_____________________________________
Secretary/Assistant Secretary
Signed, sealed and delivered before the
undersigned this 15th day of November, 2002.
_____________________________________
Notary Public
My Commission Expires:_______________
TRANSFEREE:
NORTHWESTERN CORPORATION
[CORPORATE SEAL]
__________________________________
By: ___________________________
Title: ___________________________
ATTEST:
_____________________________________
Secretary/Assistant Secretary
Signed, sealed and delivered before the
undersigned this 15th day of November, 2002.
_____________________________________
Notary Public
My Commission Expires:_______________
Exhibit B-3
EXHIBIT C
---------
MASTER BACK-TO-BACK AGREEMENT
THIS MASTER BACK-TO-BACK AGREEMENT (this "Agreement") is made and
entered into as of the 15th day of November, 2002, by and between NORTHWESTERN
ENERGY, L.L.C., a Montana limited liability company ("Transferor") and
NORTHWESTERN CORPORATION, a Delaware corporation ("Transferee"). Capitalized
terms not otherwise defined herein shall have the respective meanings ascribed
thereto in the Transfer Agreement (hereinafter defined).
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, pursuant to that certain Asset and Stock Transfer Agreement
dated as of November 15, 2002, by and between Transferor and Transferee (the
"Transfer Agreement"), Transferor has agreed to transfer and assign the
Transferred Assets to Transferee;
WHEREAS, it is a condition precedent to the consummation of the
transactions contemplated by the Transfer Agreement, that the Transferor and
Transferee enter into this Agreement which addresses (i) those rights and
obligations under contracts, leases, agreements, understandings, property
interests or other interests included in the Transferred Assets and Assumed
Liabilities, the transfer or assumption of which requires the consent, approval
or other action of a party or parties thereto other than Transferor or
Transferee or requires the satisfaction, removal or waiver of other restrictions
on transfer which consent, approval or other action has not been duly obtained
or which restrictions have not been duly satisfied, removed or waived at the
time of the Closing ("Pending Contract" or "Pending Contracts") and (ii) those
Permits comprising the Transferred Assets that are not issued in the name of
Transferee or the transfer of which requires the consent, approval or other
action of or by a Governmental or Regulatory Authority which has not been duly
obtained or accomplished at the time of the Closing ("Pending Permit" or
"Pending Permits");
WHEREAS, the parties desire to set forth their agreements and
understandings with respect to the Pending Contracts and the Pending Permits
from and after the Closing;
NOW, THEREFORE, for and in consideration of the premises and the mutual
covenants and agreements herein contained, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows.
1. PENDING CONTRACTS. With respect to each Pending Contract, from and after the
date hereof:
1.1 Transferor and Transferee agree to take and shall be deemed to have
taken such actions (including execution of documents), at Transferee's expense,
as may be requested by
Exhibit C-1
Transferee or which may be appropriate, in order to place Transferee, insofar as
is reasonably practicable and not prohibited by such Pending Contract, in the
same position as if such Pending Contract had been transferred to Transferee as
contemplated by the Transfer Agreement and so that all the benefits and burdens
relating thereto, including possession, use, risk of loss, potential for gain or
loss, dominion and control, shall inure to Transferee.
1.2 If such Pending Contract provides for Transferor to furnish any
goods, services, property or right of possession or use of property or other
performance to the counterparty under such Pending Contract (the
"Counterparty"), then Transferee agrees to furnish such goods, services,
property or right of possession or use of property or other performance in
accordance with the terms and conditions of such Pending Contract, to
Counterparty, directly in the name, place and stead of Transferor or to the
extent necessary, indirectly through Transferor, in compliance with such Pending
Contract.
1.3 If such Pending Contract provides for Transferor to receive any
goods, services, property or right of possession or use of property or other
performance from the Counterparty under such Pending Contract, then Transferor
will furnish, or cause the Counterparty to furnish, such goods, services,
property or right of use or possession of property or other performance to
Transferee, directly in the name, place and stead of Transferor or, to the
extent necessary, indirectly through Transferor, in compliance with such Pending
Contract.
1.4 If such Pending Contract provides for Transferor to make any
payments to the Counterparty thereunder, Transferee will make all such payments,
punctually and in the full amount due, in accordance with the terms of such
Pending Contract and in compliance therewith.
1.5 If Transferor receives any payments under any Pending Contract,
Transferor shall pay over to Transferee the amount received, immediately upon
receipt thereof and in the same form as received by Transferor.
2. PENDING PERMITS. From and after the Closing and in compliance with and to the
extent permitted by all applicable Laws, with respect to each Pending Permit,
pending the completion of the transfer of such Pending Permit to Transferee in
accordance with the terms of the Transfer Agreement or pending the issuance of a
replacement Permit in the name of Transferee, Transferor and Transferee agree to
take and shall be deemed to have taken such actions (including execution of
documents), at Transferee's expense, as may be requested by Transferee or which
may be appropriate, in order to place Transferee insofar as is reasonably
practicable, in the same position as if the Pending Permit had been transferred
to Transferee or issued in the name of Transferee, and so that all the benefits
and burdens relating thereto shall inure to Transferee, and Transferee agrees to
assume and comply with all of the terms and conditions of such Pending Permits.
Without limiting the generality of the foregoing, and in compliance with and to
the extent permitted by all applicable Laws, Transferor shall continue to be
responsible to the Governmental and Regulatory Authorities as the permitee under
the relevant Permits and the Transferee agrees to conduct the day-to-day
activities and operations of
Exhibit C-2
the Transferred Assets on behalf of the Transferor until the Pending Permits
have been transferred to Transferee or replacement Permits have been issued in
the name of Transferee. Until such time, the parties intend that Transferee's
conduct of day-to-day activities not trigger "operator" status under any
applicable Environmental Law, the Transferor shall remain subject to the
obligations and responsibilities associated with the Permits, and Transferee
shall conduct the day-to-day activities on behalf of the Transferor in
compliance with Environmental Laws.
3. REGULATORY AND OTHER APPROVALS. Transferor and Transferee agree to comply
with Sections 5.1 and 6.1 of the Transfer Agreement until all Pending Contracts
and all Pending Permits have been transferred to Transferee or replacements have
been issued in the name of Transferee.
4. MISCELLANEOUS.
4.1 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, and all of which shall
constitute one and the same instrument.
4.2 Entire Agreement. This Agreement supersedes all prior discussions
and agreements between the parties with respect to the subject matter hereof,
and this Agreement contains the sole and entire agreement among the parties with
respect to the matters covered hereby. This Agreement shall not be altered or
amended except by an instrument in writing signed by or on behalf of the party
entitled to the benefit of the provision against whom enforcement is sought.
4.3 Governing Law. The validity and effect of this Agreement shall be
governed by and construed and enforced in accordance with the internal laws of
the State of New York, without regard to principle of conflicts of law.
4.4 Successors and Assigns. This Agreement shall be binding upon and
shall inure to the benefit of the parties hereto and their respective heirs,
executors, legal representatives, successors and assigns.
4.5 Partial Invalidity and Severability. All rights and restrictions
contained herein may be exercised and shall be applicable and binding only to
the extent that they do not violate any applicable laws and are intended to be
limited to the extent necessary to render this Agreement legal, valid and
enforceable. If any term of this Agreement, or part thereof, not essential to
the commercial purpose of this Agreement shall be held to be illegal, invalid or
unenforceable by a court of competent jurisdiction, it is the intention of the
parties that the remaining terms hereof, or part thereof shall constitute their
agreement with respect to the subject matter hereof and all such remaining
terms, or parts thereof, shall remain in full force and effect. To the extent
legally permissible, any illegal, invalid or unenforceable provision of this
Agreement shall be replaced by a valid provision which will implement the
commercial purpose of the illegal, invalid or unenforceable provision.
Exhibit C-3
4.6 Waiver. Any term or condition of this Agreement may be waived at any
time by the party which is entitled to the benefit thereof, but only if such
waiver is evidenced by a writing signed by such party. No failure on the part of
any party hereto to exercise, and no delay in exercising any right, power or
remedy created hereunder, shall operate as a waiver thereof, nor shall any
single or partial exercise of any right, power or remedy by any such party
preclude any other or further exercise thereof or the exercise of any other
right, power or remedy. No waiver by any party hereto to any breach of or
default in any term or condition of this Agreement shall constitute a waiver of
or assent to any succeeding breach of or default in the same or any other term
or condition hereof.
4.7 Headings. The headings of particular provisions of this Agreement
are inserted for convenience only and shall not be construed as a part of this
Agreement or serve as a limitation or expansion on the scope of any term or
provision of this Agreement.
4.8 Number and Gender. Where the context requires, the use of the
singular form herein shall include the plural, the use of the plural shall
include the singular, and the use of any gender shall include any and all
genders.
4.9 Time of Performance. Time is of the essence in this performance of
this Agreement.
4.10 No Third Party Beneficiary. The terms and provisions of this
Agreement are intended solely for the benefit of each party hereto and their
respective successors or permitted assigns, and it is not the intention of the
parties to confer third-party beneficiary rights upon any other Person.
[SIGNATURES TO THIS MASTER BACK-TO-BACK AGREEMENT
ARE ON THE FOLLOWING PAGE]
Exhibit C-4
[SIGNATURES TO THIS MASTER BACK-TO-BACK AGREEMENT]
IN WITNESS WHEREOF, the parties have executed this Master Back-to-Back
Agreement as of the day and year first above written.
TRANSFEROR:
NORTHWESTERN ENERGY, L.L.C.
By: ___________________________________
Name: ____________________________
Title: ____________________________
TRANSFEREE:
NORTHWESTERN CORPORATION
By: ___________________________________
Name: ____________________________
Title: ____________________________
Exhibit C-5
EXHIBIT D
---------
MAINTENANCE AND OPERATING COSTS SUPPORT AGREEMENT
THIS MAINTENANCE AND OPERATING COSTS SUPPORT AGREEMENT (this
"Agreement") is made as the 15th day of November, 2002, between NORTHWESTERN
CORPORATION, a Delaware corporation ("Parent"), and NORTHWESTERN ENERGY, L.L.C.,
a Montana limited liability company ("Subsidiary").
WHEREAS, on January 31, 2002, the Montana Public Service Commission
issued its Order No. 6353c in Docket No. D 2001.1.5 pursuant to which, among
other things, it approved the acquisition by Parent of the utility business of
The Montana Power Company (the predecessor in interest to Subsidiary) and the
continued operation of such business "as a subsidiary or division" of Parent;
WHEREAS, on February 15, 2002, Parent acquired and continues to own 100%
of the membership interests of Subsidiary;
WHEREAS, pursuant to the Asset and Stock Transfer Agreement, dated as of
November 15, 2002 (the "Transfer Agreement"), between Parent and Subsidiary, the
parties propose to consummate a restructuring transaction involving the
assignment by Subsidiary to Parent and the assumption by Parent of substantially
all of Subsidiary's assets and liabilities (the "Transaction");
WHEREAS, certain assets of Subsidiary will not be transferred to Parent
pursuant to the Transaction, including the hydroelectric generating facility
known as the Milltown Dam Assets and associated physical structures more
particularly described on Schedule 1 hereto (the "Milltown Dam Assets");
WHEREAS, Parent and Subsidiary have entered into a Unit Power Purchase
Agreement, dated as of September 20, 2002 (the "Power Purchase Agreement"),
providing for the sale by Subsidiary to Parent of the power and energy produced
by the Milltown Dam Assets, effective upon consummation of the Transaction, and
such agreement was accepted for filing by order of the Federal Energy Regulatory
Commission pursuant to Section 205 of the Federal Power Act;
WHEREAS, it is the desire of Parent and Subsidiary that they enter into
this Agreement providing for Parent to make available to Subsidiary funds
necessary to ensure that Subsidiary will be able to make payment on any of
Subsidiary's trade accounts arising in the ordinary course of business and other
costs and expenses, all as relating to or arising in connection with the
operation and maintenance of the Milltown Dam Assets subsequent to the
consummation of the Transaction, taking into account payments due and to become
due from Parent under the Power Purchase Agreement.
NOW, THEREFORE, Subsidiary and Parent agree as follows:
Exhibit D-1
1. Support Obligation. If Subsidiary at any time is unable, after taking into
account payments due and to become due from Parent under the Power Purchase
Agreement, to make payment on any of its trade accounts arising in the ordinary
course of business or to pay any other costs and expenses (other than
Environmental Liabilities, as defined in the Transfer Agreement), in each case
relating to or arising in connection with the operation and maintenance of the
Milltown Dam Assets ("Milltown Operating Expenses"), then Subsidiary will
promptly notify Parent of the shortfall and Parent will make available to
Subsidiary, before the due date of any such Milltown Operating Expenses, funds
sufficient to enable it to pay any such Milltown Operating Expenses in full as
they fall due. Subsidiary will use the funds made available to it by Parent
solely for the payment when due of such Milltown Operating Expenses. It is
understood and agreed that Milltown Operating Expenses shall include any and all
amounts payable by Subsidiary to Parent under the Employee Secondment and
Administrative Services Agreement of even date between Parent and Subsidiary
pursuant to which Parent has agreed to second certain employees to Subsidiary in
connection with operating the Milltown Dam Assets.
2. Waiver. Parent hereby waives any failure or delay on the part of the
Subsidiary in asserting or enforcing any of its rights or in making any claims
or demands hereunder.
3. Not a Guarantee. This Agreement is not, and nothing herein contained and
nothing done pursuant hereto by Parent shall be deemed to constitute, a
guarantee, direct or indirect, by Parent of any debt, liability or obligation
arising out of a borrowing of money or a trade payable, or any other debt,
liability or obligation, of any kind or character whatsoever, of Subsidiary.
4. Modification and Amendment. This Agreement may be modified or amended only by
the written agreement of Parent and Subsidiary; provided, however, that no such
modification or amendment shall have a material adverse effect upon the ability
of Subsidiary to meet any of its payment obligations described in Section 1
above.
5. Termination. This Agreement and the obligations of Parent hereunder shall
terminate upon the expiration or earlier termination of the Power Purchase
Agreement in accordance with its terms.
6. Bankruptcy, Liquidation or Moratorium. Any rights and obligations which
either of the parties has under this Agreement will remain valid and binding
notwithstanding any bankruptcy, insolvency or liquidation of, or moratorium
involving, Subsidiary.
7. Successors and Assigns. The agreements herein set forth shall be mutually
binding upon, and inure to the mutual benefit of, Parent and Subsidiary and
their respective successors. Neither this Agreement nor the rights or duties of
any party hereto may be assigned without the prior written consent of the other
party hereto.
8. Governing Law. This Agreement shall be governed by the internal laws of the
State of New York, determined without reference to principles of conflicts of
laws.
Exhibit D-2
[SIGNATURES TO THIS MAINTENANCE AND OPERATING
COSTS SUPPORT AGREEMENT ARE ON THE FOLLOWING PAGE]
Exhibit D-3
[SIGNATURES TO THIS MAINTENANCE AND OPERATING
COSTS SUPPORT AGREEMENT]
IN WITNESS WHEREOF, the parties hereto have caused this Maintenance and
Operating Costs Support Agreement to be executed and delivered as of the day and
year first above written.
NORTHWESTERN CORPORATION
By: ___________________________________
Name: ____________________________
Title: ____________________________
NORTHWESTERN ENERGY, L.L.C.
By: ___________________________________
Name: ____________________________
Title: ____________________________
Exhibit D-4
SCHEDULE 1
(TO MAINTENANCE AND OPERATING
COSTS SUPPORT AGREEMENT)
MILLTOWN DAM ASSETS
All of Subsidiary's right, title and interest in and to all of the
assets and properties included within, or related or appertenant to (i) the
Milltown Dam Project (the "Milltown Dam Project") as described in that certain
application filed by The Montana Power Company on August 30, 1965, as amended on
April 8, 1968, for a license under Section 4(e) of the Federal Power Act for
constructed Project No. 2543 known as the Milltown Project (the "Application");
(ii) the Disposal Area Number 1; and (iii) the Milltown Rehabilitation Upland
Disposal Area, including without limitation the following:
1. All lands and interests in lands (i) constituting the Milltown Dam Project
area and enclosed by the project boundary, the limits of which are otherwise
defined, the use and occupancy of which are necessary for the purposes of the
Milltown Dam Project; such Milltown Dam Project area and project boundary being
shown and described by Exhibits J and K: Sheet 1, FPC No. 2543-8 - showing
location of project works and project boundary - which exhibits are attached to
the Application; (ii) the Disposal Area Number 1, which is located on a bluff on
the west side of the Milltown Dam reservoir, just south of the Bonner Tunnel (an
abandoned railway tunnel), where The Montana Power Company deposited sediment
removed from upstream of the Milltown Dam spillway in connection with repairs to
the spillway made in 1986 and 1987; (iii) the Milltown Rehabilitation Upland
Disposal Area, which is located on the west side of the Milltown Dam reservoir,
in the vicinity of the abandoned Chicago, Milwaukee, St. Paul & Pacific Railroad
tracks, where The Montana Power Company deposited sediment removed from upstream
of the base of the Milltown Dam in connection with repairs to the dam made in
1988 and 1989; and (iv) constituting additional lands or interests in lands
related to the Milltown Dam Project as included in the descriptions set forth
below. A description of such lands, located in Missoula County, Montana, is,
without limiting the generality of the introductory paragraph or the foregoing
general description, set forth on Appendix A, attached hereto.
2. Milltown Dam Project works consisting of the following:
(a) a dam in four sections: a 244-foot concrete abutment wall, a
152-foot concrete gravity section (maximum height about 45 feet), integral with
the powerhouse, a 52-foot long concrete sluice gate section containing four
steel gates 9 feet by 14 feet and a 216-foot long rock crib spillway beyond the
concrete sluice;
(b) a reservoir with a capacity of approximately 300 acre-feet at
maximum pond elevation of about 3,260 feet;
(c) a brick powerhouse containing five units with a total installed
capacity of 3,040 kilowatts;
Exhibit D (Schedule 1)-1
(d) 2.3 kv bus at the plant; and
(e) appurtenant facilities; the location, nature and character of which
are more specifically shown and described by Exhibit L, Sheet 1, FPC No. 2543-2
(Showing Project plan and elevations), Sheet 2, FPC No. 2543-3 (showing
Powerhouse floor plan), Sheet 3 FPC No. 2543-4 (showing Powerhouse section), and
Sheet 4, FPC No. 2543-5 (showing abutment wall elevation and sections), and
Exhibit M (consisting of two typewritten pages entitled "General Description of
Mechanical, Electrical, and Transmission Equipment, Milltown Project"), which
exhibits were attached to the Application.
3. All other structures, fixtures, equipment or facilities used or useful in the
maintenance and operation of the Milltown Dam Project and located on the
Milltown Dam Project area and all riparian or other rights, the use or
possession of which is necessary or appropriate in the maintenance or operation
of the Milltown Dam Project.
4. The interconnection point (the "Interconnection Point") between the Milltown
Dam Project and the Transferred Assets is that point located on the utility pole
structure lying north of the Montana Rail Link Railroad right of way,
approximately 500 feet north of the Milltown Dam Project, one pole south of the
radial line's intersection with Transferor circuit number 61.
5. Except for the transmission line from the Milltown Dam Project powerhouse to
the Interconnection Point, the Excluded Assets shall not include any electric or
gas transmission or distribution lines or related facilities which are located
on the lands described in Section 1 to this Schedule 1.
6. All water rights appurtenant to the Milltown Dam Project including without
limitation the following:
(i) Water Right Number 76F 30850 00, Ground Water Certificate;
(ii) Water Right Number 76F 94407 00, Statement of Claim;
(iii) Water Right Number 76M 94404 00, Statement of Claim;
(iv) Water Right Number 76M 94405 00, Statement of Claim and
(v) Water Right Number 76M 94406 00, Statement of Claim.
Exhibit D (Schedule 1)-2
APPENDIX A
----------
(TO SCHEDULE 1,
MILLTOWN DAM ASSETS)
MILLTOWN DAM PROJECT REAL PROPERTY
MISSOULA COUNTY, MONTANA
FEE LANDS, EASEMENTS AND OTHER INTERESTS
A. FEE LANDS
Parcel I
- --------
That certain piece, parcel or tract of land located in Sections 20, 21,
22, 27, 28 and 34, Township 13 North, Range 18 West, M.P.M., Missoula
County, Montana, and more particularly described as follows, to-wit:
Beginning at the Southwest corner of the E1/2SE1/4NE1/4 of Section 20,
Township 13 North, Range 18 West, M.P.M., and running thence South to
the South line of the NE1/4SE1/4 of said Section 20; thence East along
said South line of the NE1/4SE1/4 of said Section 20 and along the North
line of SW1/4SW1/4 of Section 21, 820 feet more or less to a point where
the North line of the SW1/4SW1/4 of Section 21 intersects the East
right-of-way line of the Chicago, Milwaukee, St. Paul and Pacific
Railroad Company; thence along said East line of said Railroad
right-of-way, across and through the S1/2SW1/4 of Section 21, NW1/4 and
E1/2 of Section 28, 8255 feet, more or less, to the East line of said
Section 28; thence South along the East line of said Section 28, 500
feet, more or less, to the Southeast corner of said Section 28; thence
South along the West line of the NW1/4 of Section 34, 2830 feet, more or
less, to the Southwest corner of the NW1/4 of Section 34; thence East
along the South line of the NW1/4 of Section 34, 2640 feet, more or
less, to the center of said Section 34; thence North along the center
line of Section 34, 920 feet; thence North 73(degree) East, 367 feet;
thence due East 250 feet; North 31(degree) East, 334 feet, more or less
to a point at the high water line on the South bank of the Missoula or
Hellgate River; thence Northwesterly along the South bank of said river,
and following the high water line of said River, on the West and South
banks thereof to the West boundary line of NE1/4 of Section 34; thence
North and across said River, and along the North and South center line
of said Section 34, to the South line of Section 27; thence Easterly
along the South line of said Section 27, 1252 feet; thence North
5(degree)5' West, 370 feet; thence North 23(degree)10' West, 467 feet;
thence North 35(degree)25' West, 250 feet; thence North 8(degree)20'
West, 223 feet; thence North 27(degree)30' West, 124 feet; thence North
44(degree)30' West, 325 feet; thence North 79(degree)30' West, 138 feet;
thence North 30(degree)01' West, 452.9 feet; thence South 53(degree)17'
West, 260 feet, more or less, to the center line of Section 27; thence
Northerly along the center line of said Section 27, to the South
boundary of the Northern Pacific Railway Company right-of-way; thence
Northwesterly and along said right-of-way line and across the NW1/4 of
Section 27, 3260 feet, more or less, to a point, where said right-of-way
line intersects the North line of Section 27; thence Westerly along said
North line of Section 27 and the North line of Section 28, 3220
Exhibit D (Schedule 1 - Appendix A)-1
feet, more or less, to the Northwest corner of the NE1/4 of Section 28;
thence Northerly along the North and South center line of Section 21,
1850 feet, more or less, to the high water line of the North bank of the
Missoula River; thence Northwesterly and following the high water line
of said River, and along said bank through the NE1/4SW1/4 of Section 21,
to the confluence of the Big Blackfoot River therewith; thence Easterly
and following the high water line of the said Big Blackfoot River, on
the South bank thereof, through the SE1/4NW1/4 of said Section 21 to the
North and South center line of said Section 21; thence Northerly and
across the said Big Blackfoot River and following the East line of the
NW1/4 of Section 21, to the high water line of the North bank of said
Big Blackfoot River; thence Westerly and following the course of the
high water line on the North bank of the Big Blackfoot River, in all its
bends, to a point where said high water line on the North bank
aforesaid, intersects the South right-of-way line of the Northern
Pacific Railway Company in the NW1/4 of Section 21; thence Westerly and
along the said South right-of-way line to the West side line of the
E1/2SE1/4NE1/4 of Section 20; thence Southerly along said last mentioned
line 875 feet, more or less, to the East and West center line of said
Section 20, the point of beginning.
Recording Reference: Book 108 of Deeds at page 583
Parcel II
- ---------
A strip of land 400 feet wide in the Northwest quarter (NW1/4) of
Section 21 and the East half of the Northeast quarter of the Northeast
quarter E1/2NE1/4NE1/4 of Section 20, Township 13 North, Range 18 West,
M.P.M., its outside boundaries being 200 feet on each side of the center
line of the abandoned main track of the Northern Pacific Railway Company
as the same was originally located and staked out across said premises
(and which said center line is now the center line of the track of the
Missoula Street Railway) and extending from the West line of the
E1/2NE1/4NE1/4 of Section 20, Township 13 North, Range 18 West, M.P.M.,
to the high water line of the reservoir located in the SE1/4NW1/4 of
said Section 21, Township 13 North, Range 18 West, M.P.M.
Excepting and reserving therefrom, however, and there is hereby
specifically excepted and reserved therefrom a strip of land 80 feet
wide, being 40 feet on each side of said center line of the abandoned
main track of the Northern Pacific Railway Company as the same was
originally located and staked out across the above described premises,
and now occupied by the Missoula Street Railway .
Recording Reference: Book 126 of Deeds at page 472
Parcel III
- ----------
A strip of land 80 feet wide in the NW1/4 of Section 21 and the
E1/2NE1/4NE1/4 of Section 20, Township 13 North, Range 18 West, M.P.M.,
being 40 feet on each side of the center line of the main track of the
Northern Pacific Railway
Exhibit D (Schedule 1 - Appendix A)-2
Company as the same was originally located and staked out across said
premises, and extending from a line drawn at right angles to said center
line of the main track at the point of intersection of the original
Southwesterly boundary line of the Northern Pacific Railway Company
right-of-way with the center line of the new main track of said Railway
Company as the same is now constructed; thence over, along and across
the NW1/4 said of Section 21 and the E1/2NE1/4NE1/4 of said Section 20.
Recording Reference: Book 126 of Deeds at page 473
Parcel IV
- ---------
All that portion of the Chicago, Milwaukee, St. Paul and Pacific
Railroad Company's 150 foot wide right-of-way and wye track right-of-way
in the Northwest quarter (NW1/4) and the Northwest quarter of the
Northeast quarter (NW1/4NE1/4) of Section 28 and the Southwest quarter
(SW1/4) of Section 21, the East half of the East half of the Southeast
quarter (E1/2E1/2SE1/4) and the East half of the Southeast quarter of
the Northeast quarter (E1/2SE1/4NE1/4) of Section 20, Township 13 North,
Range 18 West, P.M.M.
EXCEPT that portion in the SE1/4NW1/4 said Section 28 lying
southeasterly of former Railroad Engineer's Station 433+84, as measured
perpendicular and at right angles to the Grantor's former main track
centerline.
Recording Reference: Book 223 of Micro Records at page 564
Parcel V
- --------
The Northwest Quarter (NW1/4) of Section Thirty-four (34), Township
Thirteen (13) North of Range Eighteen (18) West, containing 160 acres.
And also all that portion of the Southwest Quarter of the Northwest
Quarter (SW1/4NW1/4) of Section Twenty-one (21), Township Thirteen (13)
North of Range Eighteen (18) West, Montana Principal Meridian, lying
south of the present used right of way of the Northern Pacific Railway
Company, passing through said Southwest Quarter of the Northwest Quarter
(SW1/4NW1/4).
Recording Reference: Book 126 of Deeds at Page 442
Parcel VI
- ---------
All of Transferor's right, title and interest, if any, in the tracts
described in Certificate of Survey No. 3441 filed in the office of the
Clerk and Recorder of Missoula County, Montana in Book 256, Page 0638.
EXCEPTING from Parcels I, II, III, IV Vand VI the interests conveyed by the
following instruments:
(i) Quitclaim Deed recorded April 30, 1941 in Book 131, Page 77, records of
Missoula County, Montana.
Exhibit D (Schedule 1 - Appendix A)-3
(ii) Quitclaim Deed recorded April 23, 1963 in Book 228, Page 272, records of
Missoula County, Montana.
(iii) Quitclaim Deed recorded July 2, 1963 in Book 229, Page 335, records of
Missoula County, Montana.
(iv) Bargain and Sale Deed recorded March 18, 1942 in Book 131, Page 427,
records of Missoula County, Montana.
(v) Modification of Reservation of Right to Flood, recorded September 7,
1983 in Book 194, Page 747, records of Missoula County, Montana.
(vi) Bargain and Sale Deed, recorded June 11, 1942 in Book 131, Page 504,
records of Missoula County, Montana.
(vii) Correction Deed recorded April 12, 1983 in Book 186, Page 2233, records
of Missoula County, Montana.
B. EASEMENTS
Easements granted or reserved to The Montana Power Company, or its predecessors
in interest, or otherwise described, in the following-described instruments, for
the right to flood and other purposes, but only to the extent such easements are
used or held for use in connection with the operation of the Milltown Dam
Project:
- ------------------------- -------------------- --------------------- ----------- --------
Grantor Grantee Recorded Book Page
- ------------------------- -------------------- --------------------- ----------- --------
Big Blackfoot Milling Clark-Montana October 19, 1906 37 217
Company Realty Company
- ------------------------- -------------------- --------------------- ----------- --------
Missoula Public Service The Montana Power December 20, 1929 108 583
Company Company
- ------------------------- -------------------- --------------------- ----------- --------
The Montana Power Luke M. Harris March 18, 1942 131 427
Company
- ------------------------- -------------------- --------------------- ----------- --------
The Montana Power John Ray Teague June 11, 1942 131 504
Company
- ------------------------- -------------------- --------------------- ----------- --------
Anaconda Copper Mining The Montana Power November 30, 1942 131 625
Company Company
- ------------------------- -------------------- --------------------- ----------- --------
The Montana Power Jack L. Green, II April 12, 1983 186 2233
Company
- ------------------------- -------------------- --------------------- ----------- --------
The Montana Power Ralph Roy Harris September 7, 1983 194 747
Company and June Harris
- ------------------------- -------------------- --------------------- ----------- --------
Champion The Montana June 6, 1986 241 0932
- ------------------------- -------------------- --------------------- ----------- --------
Exhibit D (Schedule 1 - Appendix A)-4
- ------------------------- -------------------- --------------------- ----------- --------
International Power Company
Corporation
- ------------------------- -------------------- --------------------- ----------- --------
C. OTHER RIGHTS IN REAL PROPERTY
All other rights and interests in real property owned by Transferor within the
boundary of the Milltown Dam Project which are used or held for use in
connection with the Milltown Dam Project and all other real property rights and
interests used or held for use in connection with the Milltown Dam Project.
Exhibit D (Schedule 1 - Appendix A)-5
EXHIBIT E
---------
ENVIRONMENTAL LIABILITIES SUPPORT AGREEMENT
THIS ENVIRONMENTAL LIABILITIES SUPPORT AGREEMENT (this "Agreement") is
made as the 15th day of November, 2002, between NORTHWESTERN CORPORATION, a
Delaware corporation ("Parent"), and NORTHWESTERN ENERGY, L.L.C., a Montana
limited liability company ("Subsidiary").
WHEREAS, on January 31, 2002, the Montana Public Service Commission
issued its Order No. 6353c in Docket No. D 2001.1.5 pursuant to which, among
other things, it approved the acquisition by Parent of the utility business of
The Montana Power Company (the predecessor in interest to Subsidiary) and the
continued operation of such business "as a subsidiary or division" of Parent;
WHEREAS, on February 15, 2002, Parent acquired, and continues to own
100% of the membership interests of Subsidiary;
WHEREAS, pursuant to the Asset and Stock Transfer Agreement, dated as of
November 15, 2002 (the "Transfer Agreement"), between Parent and Subsidiary, the
parties propose to consummate a restructuring transaction involving the
assignment by Subsidiary to Parent and the assumption by Parent of substantially
all of Subsidiary's assets and liabilities (the "Transaction");
WHEREAS, certain Excluded Liabilities (as such term is defined in the
Transfer Agreement) of Subsidiary will not be transferred to or assumed by
Parent pursuant to the Transaction;
WHEREAS, the Excluded Liabilities include all Environmental Liabilities,
as such term is defined in Schedule 2 hereto, relating to the Excluded Assets
described on Schedule 1 hereto (the "Environmental Liabilities"); and
WHEREAS, it is the desire of Parent and Subsidiary that they enter into
this agreement providing for Parent, subject to the maximum amount set forth in
this Agreement, to make available to Subsidiary funds necessary to ensure that
Subsidiary will be able to make payment for all of its Environmental Liabilities
subsequent to the consummation of the Transaction.
NOW, THEREFORE, Subsidiary and Parent agree as follows:
1. Maintenance of Net Worth. Parent agrees that it shall cause Subsidiary to
have at all times a net worth, as determined in accordance with generally
accepted accounting principles in the United States of America, of at least
US$1,000.
Exhibit E-1
If Subsidiary at any time runs short of cash and other liquid assets to meet any
obligation to make payments in respect of its Environmental Liabilities, then
Subsidiary will promptly notify Parent of the shortfall and Parent will make
available to Subsidiary, within a commercially reasonable period, funds
sufficient to enable it to fulfill any such payment obligation. Subsidiary will
use the funds made available to it by Parent solely for the payment of its
Environmental Liabilities. In the event Parent funds any Environmental
Liabilities as contemplated hereby and Subsidiary subsequently receives
insurance proceeds with respect to such Environmental Liabilities, Subsidiary
shall promptly pay to Parent an amount equal to the amount of such insurance
proceeds, but Parent's remaining liability hereunder shall not be increased by
the amount of such payment by Subsidiary. In the event Parent funds any
Environmental Liabilities as contemplated hereby and Parent subsequently
recovers an indemnity payment from Touch America Holdings Inc. ("Touch America")
pursuant to the provisions of Section 10.04 (special environmental
indemnification) of the UPA, as defined in the Transfer Agreement (the "UPA"),
in respect of such Environmental Liabilities in whole or in part, then subject
to Section 2 hereof Parent will be entitled to retain the whole amount of such
indemnity payment and Parent's remaining liability hereunder shall not be
increased by all or any portion of the amount retained. Parent agrees to use
commercially reasonable efforts to claim for indemnification under Section 10.04
of the UPA all Environmental Liabilities incurred by Subsidiary.
2. Maximum Liability of Parent. The total liability of Parent under Section 1 of
this Agreement shall at no time exceed a maximum cumulative amount of Fifteen
Million Dollars (US$10,000,000). In the event Parent recovers an indemnity
payment from Touch America pursuant to the provisions of Section 10.04 of the
UPA, then Parent shall (i) allocate to Subsidiary a pro rata share of such
indemnity payment based on the ratio that the amount Parent claimed against
Touch America under such Section 10.04 in respect of the Environmental
Liabilities hereunder bears to the total amount Parent claimed under such
Section 10.04 and (ii) pay over to Subsidiary an amount equal to the positive
amount remaining, if any, equal to (x) the amount of such pro rata share minus
(y) the total amount of the Environmental Liabilities theretofore funded by
Parent hereunder.
3. Waiver. Parent hereby waives any failure or delay on the part of Subsidiary
in asserting or enforcing any of its rights or in making any claims or demands
hereunder.
4. Not a Guarantee. This Agreement is not, and nothing herein contained and
nothing done pursuant hereto by Parent shall be deemed to constitute, a
guarantee, direct or indirect, by Parent of Environmental Liabilities or any
debt, liability or obligation arising out of a borrowing of money or a trade
payable, or any other debt, liability or obligation, of any kind or character
whatsoever, of Subsidiary.
5. Modification and Amendment. This Agreement may be modified or amended only by
the written agreement of Parent and Subsidiary, provided, however, that no such
modification or amendment shall have any material adverse effect upon the
ability of Subsidiary to meet its obligations in respect to the Environmental
Liabilities without the prior written consent of the Director, Montana office,
EPA Region 8, or any superior to such Director within the EPA.
Exhibit E-2
6. Termination. This Agreement and the obligations of Parent hereunder shall
terminate on the earlier of (i) payment in full of all amounts payable by
Subsidiary in respect the Environmental Liabilities pursuant to settlement
approved or consented to by the Director, Montana office, EPA Region 8, or any
superior to such Director within the EPA and (ii) payments by Parent to
Subsidiary hereunder of funds in an aggregate amount equal to the maximum
cumulative amount specified in Section 2 hereof.
7. Bankruptcy, Liquidation or Moratorium. Any rights and obligations which
either of the parties has under this Agreement will remain valid and binding
notwithstanding any bankruptcy, insolvency or liquidation of, or moratorium
involving, Subsidiary.
8. Successors and Assigns. The agreements herein set forth shall be mutually
binding upon, and inure to the mutual benefit of, Parent and Subsidiary and
their respective successors. Neither this Agreement nor the rights or duties of
any party hereto may be assigned without the prior written consent of the other
party hereto.
9. Governing Law. This Agreement shall be governed by the internal laws of the
State of New York, determined without reference to principles of conflicts of
laws.
[SIGNATURES TO THIS ENVIRONMENTAL LIABILITIES
SUPPORT AGREEMENT ARE ON THE FOLLOWING PAGE]
Exhibit E-3
[SIGNATURES TO THIS ENVIRONMENTAL LIABILITIES
SUPPORT AGREEMENT]
IN WITNESS WHEREOF, the parties hereto have caused this Environmental
Liabilities Support Agreement to be executed and delivered as of the day and
year first above written.
NORTHWESTERN CORPORATION
By: ___________________________________
Name: ____________________________
Title: ____________________________
NORTHWESTERN ENERGY, L.L.C.
By: ___________________________________
Name: ____________________________
Title: ____________________________
Exhibit E-4
SCHEDULE 1
(TO ENVIRONMENTAL LIABILITIES
SUPPORT AGREEMENT)
EXCLUDED ASSETS
1. All of Transferor's right, title and interest in and to all of the assets and
properties included within, or related or appertenant to (i) the Milltown Dam
Project (the "Milltown Dam Project") as described in that certain application
filed by The Montana Power Company on August 30, 1965, as amended on April 8,
1968, for a license under Section 4(e) of the Federal Power Act for constructed
Project No. 2543 known as the Milltown Project (the "Application"); (ii) the
Disposal Area Number 1, which is located on a bluff on the west side of the
Milltown Dam reservoir, just south of the Bonner Tunnel (an abandoned railway
tunnel), where The Montana Power Company deposited sediment removed from
upstream of the Milltown Dam spillway in connection with repairs to the spillway
made in 1986 and 1987; and (iii) the Milltown Rehabilitation Upland Disposal
Area, which is located on the west side of the Milltown Dam reservoir, in the
vicinity of the abandoned Chicago, Milwaukee, St. Paul & Pacific Railroad
tracks, where The Montana Power Company deposited sediment removed from upstream
of the base of the Milltown Dam in connection with repairs to the dam made in
1988 and 1989, including without limitation the following:
a. All lands and interests in lands (i) constituting the Milltown Dam
Project area and enclosed by the project boundary, the limits of which are
otherwise defined, the use and occupancy of which are necessary for the purposes
of the Milltown Dam Project; such Milltown Dam Project area and project boundary
being shown and described by Exhibits J and K: Sheet 1, FPC No. 2543-8 - showing
location of project works and project boundary - which exhibits are attached to
the Application; (ii) constituting the Disposal Area Number 1; (iii)
constituting the Milltown Rehabilitation Upland Disposal Area; and (iv)
constituting additional lands or interests in lands related to the Milltown Dam
Project as included in the descriptions set forth below. A description of such
lands, located in Missoula County, Montana, is, without limiting the generality
of the introductory paragraph or the foregoing general description, set forth on
Appendix A, attached hereto.
b. Milltown Dam Project works consisting of the following:
(i) a dam in four sections: a 244-foot concrete abutment wall, a
152-foot concrete gravity section (maximum height about 45 feet), integral with
the powerhouse, a 52-foot long concrete sluice gate section containing four
steel gates 9 feet by 14 feet and a 216-foot long rock crib spillway beyond the
concrete sluice;
(ii) a reservoir with a capacity of approximately 300 acre-feet at
maximum pond elevation of about 3,260 feet;
Exhibit E (Schedule 1)-1
(iii) a brick powerhouse containing five units with a total installed
capacity of 3,040 kilowatts;
(iv) 2.3 kv bus at the plant; and
(v) appurtenant facilities; the location, nature and character of
which are more specifically shown and described by Exhibit L, Sheet 1, FPC No.
2543-2 (Showing Project plan and elevations), Sheet 2, FPC No. 2543-3 (showing
Powerhouse floor plan), Sheet 3 FPC No. 2543-4 (showing Powerhouse section), and
Sheet 4, FPC No. 2543-5 (showing abutment wall elevation and sections), and
Exhibit M (consisting of two typewritten pages entitled "General Description of
Mechanical, Electrical, and Transmission Equipment, Milltown Project"), which
exhibits were attached to the Application.
c. All other structures, fixtures, equipment or facilities used or
useful in the maintenance and operation of the Milltown Dam Project and located
on the Milltown Dam Project area and all riparian or other rights, the use or
possession of which is necessary or appropriate in the maintenance or operation
of the Milltown Dam Project.
d. The interconnection point (the "Interconnection Point") between the
Milltown Dam Project and the Transferred Assets is that point located on the
utility pole structure lying north of the Montana Rail Link Railroad right of
way, approximately 500 feet north of the Milltown Dam Project, one pole south of
the radial line's intersection with Transferor circuit number 61.
e. Except for the transmission line from the Milltown Dam Project
powerhouse to the Interconnection Point, the Excluded Assets shall not include
any electric or gas transmission or distribution lines or related facilities
which are located on the lands described in Section 1.a. to this Schedule 1.
f. All water rights appurtenant to the Milltown Dam Project including
without limitation the following:
(i) Water Right Number 76F 30850 00, Ground Water Certificate;
(ii) Water Right Number 76F 94407 00, Statement of Claim;
(iii) Water Right Number 76M 94404 00, Statement of Claim;
(iv) Water Right Number 76M 94405 00, Statement of Claim and
(v) Water Right Number 76M 94406 00, Statement of Claim.
Exhibit E (Schedule 1)-2
APPENDIX A
----------
(TO SCHEDULE 1,
EXCLUDED ASSETS)
MILLTOWN DAM PROJECT REAL PROPERTY
MISSOULA COUNTY, MONTANA
FEE LANDS, EASEMENTS AND OTHER INTERESTS
A. FEE LANDS
Parcel I
- --------
That certain piece, parcel or tract of land located in Sections 20, 21,
22, 27, 28 and 34, Township 13 North, Range 18 West, M.P.M., Missoula
County, Montana, and more particularly described as follows, to-wit:
Beginning at the Southwest corner of the E1/2SE1/4NE1/4 of Section 20,
Township 13 North, Range 18 West, M.P.M., and running thence South to
the South line of the NE1/4SE1/4 of said Section 20; thence East along
said South line of the NE1/4SE1/4 of said Section 20 and along the North
line of SW1/4SW1/4 of Section 21, 820 feet more or less to a point where
the North line of the SW1/4SW1/4 of Section 21 intersects the East
right-of-way line of the Chicago, Milwaukee, St. Paul and Pacific
Railroad Company; thence along said East line of said Railroad
right-of-way, across and through the S1/2SW1/4 of Section 21, NW1/4 and
E1/2 of Section 28, 8255 feet, more or less, to the East line of said
Section 28; thence South along the East line of said Section 28, 500
feet, more or less, to the Southeast corner of said Section 28; thence
South along the West line of the NW1/4 of Section 34, 2830 feet, more or
less, to the Southwest corner of the NW1/4 of Section 34; thence East
along the South line of the NW1/4 of Section 34, 2640 feet, more or
less, to the center of said Section 34; thence North along the center
line of Section 34, 920 feet; thence North 73(degree) East, 367 feet;
thence due East 250 feet; North 31(degree) East, 334 feet, more or less
to a point at the high water line on the South bank of the Missoula or
Hellgate River; thence Northwesterly along the South bank of said river,
and following the high water line of said River, on the West and South
banks thereof to the West boundary line of NE1/4 of Section 34; thence
North and across said River, and along the North and South center line
of said Section 34, to the South line of Section 27; thence Easterly
along the South line of said Section 27, 1252 feet; thence North
5(degree)5' West, 370 feet; thence North 23(degree)10' West, 467 feet;
thence North 35(degree)25' West, 250 feet; thence North 8(degree)20'
West, 223 feet; thence North 27(degree)30' West, 124 feet; thence North
44(degree)30' West, 325 feet; thence North 79(degree)30' West, 138 feet;
thence North 30(degree)01' West, 452.9 feet; thence South 53(degree)17'
West, 260 feet, more or less, to the center line of Section 27; thence
Northerly along the center line of said Section 27, to the South
boundary of the Northern Pacific Railway Company right-of-way; thence
Northwesterly and along said right-of-way line and across the NW1/4 of
Section 27, 3260 feet, more or less, to a point, where said right-of-way
line intersects the North line of Section 27; thence Westerly along said
North line of Section 27 and the North line of Section 28, 3220
Exhibit E (Schedule 1 - Appendix A)-1
feet, more or less, to the Northwest corner of the NE1/4 of Section 28;
thence Northerly along the North and South center line of Section 21,
1850 feet, more or less, to the high water line of the North bank of the
Missoula River; thence Northwesterly and following the high water line
of said River, and along said bank through the NE1/4SW1/4 of Section 21,
to the confluence of the Big Blackfoot River therewith; thence Easterly
and following the high water line of the said Big Blackfoot River, on
the South bank thereof, through the SE1/4NW1/4 of said Section 21 to the
North and South center line of said Section 21; thence Northerly and
across the said Big Blackfoot River and following the East line of the
NW1/4 of Section 21, to the high water line of the North bank of said
Big Blackfoot River; thence Westerly and following the course of the
high water line on the North bank of the Big Blackfoot River, in all its
bends, to a point where said high water line on the North bank
aforesaid, intersects the South right-of-way line of the Northern
Pacific Railway Company in the NW1/4 of Section 21; thence Westerly and
along the said South right-of-way line to the West side line of the
E1/2SE1/4NE1/4 of Section 20; thence Southerly along said last mentioned
line 875 feet, more or less, to the East and West center line of said
Section 20, the point of beginning.
Recording Reference: Book 108 of Deeds at page 583
Parcel II
- ---------
A strip of land 400 feet wide in the Northwest quarter (NW1/4) of
Section 21 and the East half of the Northeast quarter of the Northeast
quarter E1/2NE1/4NE1/4 of Section 20, Township 13 North, Range 18 West,
M.P.M., its outside boundaries being 200 feet on each side of the center
line of the abandoned main track of the Northern Pacific Railway Company
as the same was originally located and staked out across said premises
(and which said center line is now the center line of the track of the
Missoula Street Railway) and extending from the West line of the
E1/2NE1/4NE1/4 of Section 20, Township 13 North, Range 18 West, M.P.M.,
to the high water line of the reservoir located in the SE1/4NW1/4 of
said Section 21, Township 13 North, Range 18 West, M.P.M.
Excepting and reserving therefrom, however, and there is hereby
specifically excepted and reserved therefrom a strip of land 80 feet
wide, being 40 feet on each side of said center line of the abandoned
main track of the Northern Pacific Railway Company as the same was
originally located and staked out across the above described premises,
and now occupied by the Missoula Street Railway .
Recording Reference: Book 126 of Deeds at page 472
Parcel III
- ----------
A strip of land 80 feet wide in the NW1/4 of Section 21 and the
E1/2NE1/4NE1/4 of Section 20, Township 13 North, Range 18 West, M.P.M.,
being 40 feet on each side of the center line of the main track of the
Northern Pacific Railway
Exhibit E (Schedule 1 - Appendix A)-2
Company as the same was originally located and staked out across said
premises, and extending from a line drawn at right angles to said center
line of the main track at the point of intersection of the original
Southwesterly boundary line of the Northern Pacific Railway Company
right-of-way with the center line of the new main track of said Railway
Company as the same is now constructed; thence over, along and across
the NW1/4 said of Section 21 and the E1/2NE1/4NE1/4 of said Section 20.
Recording Reference: Book 126 of Deeds at page 473
Parcel IV
- ---------
All that portion of the Chicago, Milwaukee, St. Paul and Pacific
Railroad Company's 150 foot wide right-of-way and wye track right-of-way
in the Northwest quarter (NW1/4) and the Northwest quarter of the
Northeast quarter (NW1/4NE1/4) of Section 28 and the Southwest quarter
(SW1/4) of Section 21, the East half of the East half of the Southeast
quarter (E1/2E1/2SE1/4) and the East half of the Southeast quarter of
the Northeast quarter (E1/2SE1/4NE1/4) of Section 20, Township 13 North,
Range 18 West, P.M.M.
EXCEPT that portion in the SE1/4NW1/4 said Section 28 lying
southeasterly of former Railroad Engineer's Station 433+84, as measured
perpendicular and at right angles to the Grantor's former main track
centerline.
Recording Reference: Book 223 of Micro Records at page 564
Parcel V
- --------
The Northwest Quarter (NW1/4) of Section Thirty-four (34), Township
Thirteen (13) North of Range Eighteen (18) West, containing 160 acres.
And also all that portion of the Southwest Quarter of the Northwest
Quarter (SW1/4NW1/4) of Section Twenty-one (21), Township Thirteen (13)
North of Range Eighteen (18) West, Montana Principal Meridian, lying
south of the present used right of way of the Northern Pacific Railway
Company, passing through said Southwest Quarter of the Northwest Quarter
(SW1/4NW1/4).
Recording Reference: Book 126 of Deeds at Page 442
Parcel VI
- ---------
All of Transferor's right, title and interest, if any, in the tracts
described in Certificate of Survey No. 3441 filed in the office of the
Clerk and Recorder of Missoula County, Montana in Book 256, Page 0638.
EXCEPTING from Parcels I, II, III, IV, V and VI the interests conveyed by
the following instruments:
(i) Quitclaim Deed recorded April 30, 1941 in Book 131, Page 77, records of
Missoula County, Montana.
Exhibit E (Schedule 1 - Appendix A)-3
(ii) Quitclaim Deed recorded April 23, 1963 in Book 228, Page 272, records of
Missoula County, Montana.
(iii) Quitclaim Deed recorded July 2, 1963 in Book 229, Page 335, records of
Missoula County, Montana.
(iv) Bargain and Sale Deed recorded March 18, 1942 in Book 131, Page 427,
records of Missoula County, Montana.
(v) Modification of Reservation of Right to Flood, recorded September 7,
1983 in Book 194, Page 747, records of Missoula County, Montana.
(vi) Bargain and Sale Deed, recorded June 11, 1942 in Book 131, Page 504,
records of Missoula County, Montana.
(vii) Correction Deed recorded April 12, 1983 in Book 186, Page 2233, records
of Missoula County, Montana.
B. EASEMENTS
Easements granted or reserved to The Montana Power Company, or its predecessors
in interest, or otherwise described, in the following-described instruments, for
the right to flood and other purposes, but only to the extent such easements are
used or held for use in connection with the operation of the Milltown Dam
Project:
- ------------------------- -------------------- --------------------- ----------- --------
Grantor Grantee Recorded Book Page
- ------------------------- -------------------- --------------------- ----------- --------
Big Blackfoot Milling Clark-Montana October 19, 1906 37 217
Company Realty Company
- ------------------------- -------------------- --------------------- ----------- --------
Missoula Public Service The Montana Power December 20, 1929 108 583
Company Company
- ------------------------- -------------------- --------------------- ----------- --------
The Montana Power Luke M. Harris March 18, 1942 131 427
Company
- ------------------------- -------------------- --------------------- ----------- --------
The Montana Power John Ray Teague June 11, 1942 131 504
Company
- ------------------------- -------------------- --------------------- ----------- --------
Anaconda Copper Mining The Montana Power November 30, 1942 131 625
Company Company
- ------------------------- -------------------- --------------------- ----------- --------
The Montana Power Jack L. Green, II April 12, 1983 186 2233
Company
- ------------------------- -------------------- --------------------- ----------- --------
The Montana Power Ralph Roy Harris September 7, 1983 194 747
Company and June Harris
- ------------------------- -------------------- --------------------- ----------- --------
Champion The Montana June 6, 1986 241 0932
- ------------------------- -------------------- --------------------- ----------- --------
Exhibit E (Schedule 1 - Appendix A)-4
- ------------------------- -------------------- --------------------- ----------- --------
International Power Company
Corporation
- ------------------------- -------------------- --------------------- ----------- --------
C. OTHER RIGHTS IN REAL PROPERTY
All other rights and interests in real property owned by Transferor within the
boundary of the Milltown Dam Project which are used or held for use in
connection with the Milltown Dam Project and all other real property rights and
interests used or held for use in connection with the Milltown Dam Project.
Exhibit E (Schedule 1 - Appendix A)-5
SCHEDULE 2
(TO ENVIRONMENTAL LIABILITIES
SUPPORT AGREEMENT)
EXCLUDED LIABILITIES
1. All Environmental Liabilities relating to the Excluded Assets.
"Environmental Liabilities" shall mean and include any investigation,
notice of violation, demand, allegation, action, suit, injunction, judgment,
order, consent decree, penalty, fine, lien, liability, obligation, sanction,
abatement, proceeding, or claim (whether administrative, judicial or private in
nature) arising: (A) pursuant to, or in connection with, an actual or alleged
violation of any Environmental Law; (B) in connection with any Hazardous
Materials or actual or alleged activity associated with any Hazardous Materials;
(C) from any remediation, abatement, removal, remedial, corrective, or other
response action in connection with any Hazardous Materials, Environmental Law or
other order or directive of any Governmental or Regulatory Authority; (D) from
any actual or alleged damage, injury, threat or harm to health, safety, natural
resources, or the environment; (E) from the use, management, disposal or release
(or threatened release) of Hazardous Materials; (F) from personal injury
(including death), tangible or intangible property damage, damage to the
environment or natural resources, pollution or contamination arising under
Environmental Laws; or (G) from the contribution to the cost of investigating,
removing, responding, remediating or monitoring the release of Hazardous
Materials.
"Environmental Laws" shall mean all Federal, state, municipal and local
laws (including common laws), regulations, rules, ordinances, codes, licenses,
decrees, judgments, directives, or judicial or administrative orders relating to
pollution, protection, preservation or restoration of human health, the
environment or natural resources, including, without limitation, laws relating
to releases or threatened releases of Hazardous Materials (including, without
limitation, into or through ambient air, surface water, groundwater, land,
wetlands, surface and subsurface strata) or otherwise relating to the
manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling or Hazardous Materials, including without limitation the
Clean Water Act, the Clean Air Act, the Resource Conservation and Recovery Act,
the Toxic Substances Control Act, and the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, in each case as amended, and their local
counterparts.
"Hazardous Materials" shall mean (a) any petrochemical, petroleum or
petroleum products, oil, flammable explosives, radioactive materials, radon gas,
asbestos in any form that is or could become friable, urea formaldehyde foam
insulation and transformers or other equipment that contain dielectric fluid
which may contain levels of polychlorinated biphenyls (PCBs); (b) any chemicals
or other materials or substances which are now or hereafter become defined under
any Environmental Law as or included in the definition of "hazardous
substances", "hazardous wastes", "hazardous chemicals", "hazardous materials",
"extremely hazardous wastes", "restricted hazardous wastes", "toxic substances",
"pollutants", "contaminants", "hazardous
Exhibit E (Schedule 2)-1
matter", "restricted hazardous materials", or words of similar import; and (c)
any other chemical or other material or substance, the discharge, emission,
release or exposure to which is now or hereafter prohibited, limited or
regulated by any Governmental or Regulatory Authority under any Environmental
Law.
2. All liabilities and obligations under the following written notices
of PRP liability under CERCLA and Montana statutes: (a) PRP notice issued by US
EPA relating to the Milltown Dam issued September 27, 1985; and (b) PRP notice
issued by US EPA in 1991 relating to the Butte Priority Soil Operable Unit
Superfund Site.
Exhibit E (Schedule 2)-2
EXHIBIT F
---------
INTERCONNECTION AGREEMENT
Exhibit F-1
EXHIBIT G
---------
EMPLOYEE SECONDMENT AND
ADMINISTRATIVE SERVICES AGREEMENT
THIS EMPLOYEE SECONDMENT AND ADMINISTRATIVE SERVICES AGREEMENT (this
"Agreement") is entered into as of November 15, 2002, by and between
NORTHWESTERN ENERGY, L.L.C., a Montana limited liability company (the
"Company"), and NORTHWESTERN CORPORATION, a Delaware corporation ("Seconding
Party").
W I T N E S S E T H :
- - - - - - - - - -
WHEREAS, pursuant to that certain Asset and Stock Transfer Agreement
dated as of November 15, 2002 by and between the Company and Seconding Party
(the "Transfer Agreement"), the Company has agreed to transfer and assign to
Seconding Party substantially of the assets and properties of the Company,
including all of the employees of the Company; and
WHEREAS, pursuant to the terms of the Transfer Agreement, it is a
condition precedent to the consummation of the transactions contemplated thereby
that the parties enter into this Agreement whereby those certain employees who
performed functions at the Milltown hydroelectric dam on the Clark Fork River
(the "Milltown Dam"), and in connection with the regular operation thereof, will
be seconded by Seconding Party to the Company; and
WHEREAS, pursuant to the terms of this Agreement, Seconding Party
desires to second those employees who previously performed functions at the
Milltown Dam, and in connection with the regular operation thereof, to the
Company, and the Company desires such employees to be so seconded.
NOW, THEREFORE, for and in consideration of the premises and the mutual
covenants and agreements herein contained, and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
parties hereto agree as follows:
1. SECONDMENT OF EMPLOYEES
1.1 Secondment of Employees.
(a) Seconded Employees. During the term of this Agreement, Seconding
Party will second to the Company, and the Company will accept on secondment from
Seconding Party, those employees and/or contracted staff of Seconding Party who
perform functions at the Milltown Dam, and in connection with the regular
operation thereof, as set forth on Appendix A attached hereto (each a "Seconded
Employee"). Seconding Party shall have a reasonable and good faith belief that
each Seconded Employee has the proper qualifications, training, background and
experience for the position that each Seconded Employee will hold at the
Exhibit G-1
Company. Appendix A shall be amended from time to time to include additional
Seconded Employees upon appointment thereof for secondment to the Company, as
mutually agreed by the parties.
(b) Status of Seconded Employees. Seconded Employees shall remain
employees of Seconding Party at all times during the secondment, and Seconding
Party shall retain all rights and duties under applicable labor and employment
laws with respect to the direction and supervision of such Seconded Employees.
The Company, and not Seconding Party, shall have all duties and liabilities
under applicable law to third parties caused by or arising out of acts, errors
or omissions of Seconded Employees in the course of performing their duties for
the Company, including the operation and maintenance of the Milltown Dam.
Without limiting the foregoing, Seconding Party shall use reasonable efforts to
ensure that each Seconded Employee shall comply with the Company's policies,
procedures, rules, regulations and instructions concerning his or her duties,
vacations and day-to-day activities and the Company's rules of employment and
human resource policies and procedures, as may be established and amended from
time to time, in matters concerning his or her daily employment activities. The
Company shall at all times consistently apply its rules of employment and human
resources and employee policies and procedures to each of the Seconded Employees
without discrimination. Unless otherwise agreed by the parties hereto in writing
with respect to a given Seconded Employee, Seconding Party shall cause each
Seconded Employee to devote such time and attention to the Company as would
reasonably be expected of a full-time employee occupying the position to be held
by the Seconded Employee.
1.2 Removal and Replacement of Seconded Employees.
(a) Removal by Seconding Party. The Seconding Party shall not remove
any Seconded Employee without cause, unless mutually agreed by the parties.
(b) Removal by the Company. The Company shall not terminate the
secondment of any Seconded Employee without cause, unless mutually agreed by the
parties. In connection with any such termination, Seconding Party shall have the
right to appoint a replacement Seconded Employee to be seconded to the Company,
which appointment shall be made in good faith within thirty (30) days of such
termination.
(c) Resignation by Seconded Employee. In the event that any Seconded
Employee terminates his or her employment with Seconding Party, or provides
notice of such termination, Seconding Party shall immediately notify the Company
and shall have the right to appoint a replacement Seconded Employee to be
seconded to the Company, which appointment shall be made in good faith within
thirty (30) days of such cessation of employment.
2. COMPENSATION
2.1 Compensation. Seconding Party shall be responsible for and shall pay
each Seconded Employee's salary and all other compensation of such employee. On
a monthly basis,
Exhibit G-2
Seconding Party shall bill the Company for the salary and all the compensation
it incurs with respect to each Seconded Employee.
2.2 Other Expenses. Seconding Party shall bill the Company monthly for
the cost of the following employment-related expenses of the Seconded Employees:
(a) Benefits. All employee benefits in accordance with Seconding
Party's practices and policies then in effect, and the Company shall have no
direct liability or responsibility for such payments or obligations whatsoever.
(b) Taxes. All employee taxes, employee withholding, trust funds,
surcharges, allowances or deductions arising out of or relating to the
employment or payment of employee compensation to the Seconded Employees, and
the Company shall have no direct liability or responsibility for such payments
or obligations whatsoever.
3. TERMINATION AND INDEMNIFICATION
3.1 Term. This Agreement shall remain in effect until the earlier of
such time as (i) five (5) years from the date hereof, or (ii) the date of
termination or expiration of the Unit Power Purchase Agreement dated as of
September 20, 2002, by and between Seconding Party and the Company. This
Agreement also may be terminated at such time as the parties hereto may mutually
agree.
3.2 Indemnification.
(a) Seconding Party shall defend, indemnify and hold harmless the
Company, its assigns, agents, officers and employees, harmless from and against
any claims, losses, damages or judgments arising out of, resulting from or
relating to any willful misconduct or gross negligence on the part of any
Seconded Employee arising out of or relating to their employment with the
Company.
(b) The Company shall defend, indemnify and hold harmless Seconding
Party, its assigns, agents, officers and employees, from and against any
liability to any third party caused by or relating to acts, errors or omissions
of Seconded Employees in the course of performing their duties for the Company,
including the operation of the Milltown Dam.
Exhibit G-3
4. ADMINISTRATIVE SERVICES
Seconding Party shall at no cost to Company provide to Company certain
administrative support services from and after the Closing, as reasonably
requested by Company in connection with the administration and management of the
Excluded Assets and the Excluded Liabilities, as such terms are defined in the
Transfer Agreement, including without limitation, the engagement and
coordination of counsel and other outside consultants.
5. MISCELLANEOUS
5.1 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, and all of which shall
constitute one and the same instrument.
5.2 Entire Agreement. This Agreement supersedes all prior discussions
and agreements between the parties with respect to the subject matter hereof,
and this Agreement contains the sole and entire agreement among the parties with
respect to the matters covered hereby. This Agreement shall not be altered or
amended except by an instrument in writing signed by or on behalf of the party
entitled to the benefit of the provision against whom enforcement is sought.
5.3 Governing Law. The validity and effect of this Agreement shall be
governed by and construed and enforced in accordance with the internal laws of
the State of New York, without regard to principle of conflicts of laws.
5.4 Successors and Assigns. This Agreement shall be binding upon and
shall inure to the benefit of the parties hereto and their respective heirs,
executors, legal representatives, successors and assigns.
5.5 Partial Invalidity and Severability. All rights and restrictions
contained herein may be exercised and shall be applicable and binding only to
the extent that they do not violate any applicable laws and are intended to be
limited to the extent necessary to render this Agreement legal, valid and
enforceable. If any term of this Agreement, or part thereof, not essential to
the commercial purpose of this Agreement shall be held to be illegal, invalid or
unenforceable by a court of competent jurisdiction, it is the intention of the
parties that the remaining terms hereof, or part thereof shall constitute their
agreement with respect to the subject matter hereof and all such remaining
terms, or parts thereof, shall remain in full force and effect. To the extent
legally permissible, any illegal, invalid or unenforceable provision of this
Agreement shall be replaced by a valid provision which will implement the
commercial purpose of the illegal, invalid or unenforceable provision.
5.6 Waiver. Any term or condition of this Agreement may be waived at any
time by the party which is entitled to the benefit thereof, but only if such
waiver is evidenced by a writing signed by such party. No failure on the part of
any party hereto to exercise, and no delay
Exhibit G-4
in exercising any right, power or remedy created hereunder, shall operate as a
waiver thereof, nor shall any single or partial exercise of any right, power or
remedy by any such party preclude any other or further exercise thereof or the
exercise of any other right, power or remedy. No waiver by any party hereto to
any breach of or default in any term or condition of this Agreement shall
constitute a waiver of or assent to any succeeding breach of or default in the
same or any other term or condition hereof.
5.7 Headings. The headings of particular provisions of this Agreement
are inserted for convenience only and shall not be construed as a part of this
Agreement or serve as a limitation or expansion on the scope of any term or
provision of this Agreement.
5.8 Number and Gender. Where the context requires, the use of the
singular form herein shall include the plural, the use of the plural shall
include the singular, and the use of any gender shall include any and all
genders.
5.9 Time of Performance. Time is of the essence in the performance of
this Agreement.
5.10 No Third Party Beneficiary. The terms and provisions of this
Agreement are intended solely for the benefit of each party hereto and their
respective successors or permitted assigns, and it is not the intention of the
parties to confer third-party beneficiary rights upon any other Person.
[SIGNATURES TO THIS SECONDMENT AGREEMENT ON NEXT PAGE]
Exhibit G-5
+
IN WITNESS WHEREOF, the parties have executed and delivered this
Secondment Agreement as of the date first above written.
COMPANY:
NORTHWESTERN ENERGY, L.L.C.
By: ________________________________
Name: _________________________
Title: _________________________
SECONDING PARTY:
NORTHWESTERN CORPORATION
By: ________________________________
Name: _________________________
Title: _________________________
[SIGNATURE PAGE TO SECONDMENT AGREEMENT]
Exhibit G-6
APPENDIX A
----------
(TO SECONDMENT AGREEMENT)
SECONDED EMPLOYEES
Name Title Employee Number
---- ----- ---------------
William Scarbrough Union-Hydro Foreman P00080675
Scott Doherty Union-Maintenance P00011311
Exhibit G (Appendix A)-1
EXHIBIT H-1
-----------
CLOSING CERTIFICATE (TRANSFEROR)
The undersigned officer of NORTHWESTERN ENERGY, L.L.C., a Montana
limited liability company ("Transferor"), hereby certifies to NORTHWESTERN
CORPORATION, a Delaware corporation ("Transferee"), pursuant to the Asset and
Stock Transfer Agreement, dated as of November 15, 2002, between Transferor and
Transferee (the "Agreement;" all capitalized terms used but not defined herein
shall have the meanings ascribed to such terms in the Agreement) that:
(i) The undersigned is the duly appointed [______________________] of
Transferor and is duly authorized to execute and deliver this certificate on
behalf of Transferor; and
(ii) Each of the conditions precedent to the obligations of Transferor
set forth in Section 8 of the Agreement have been satisfied or properly waived
to the satisfaction of Transferor on and as of the date hereof.
November 15, 2002
"TRANSFEROR"
NORTHWESTERN ENERGY, L.L.C.,
(a Montana limited liability company)
By: ___________________________________
Name: ____________________________
Title: ____________________________
Exhibit H1-1
EXHIBIT H-2
-----------
CLOSING CERTIFICATE (TRANSFEREE)
The undersigned officer of NORTHWESTERN CORPORATION, a Delaware
corporation ("Transferee"), hereby certifies to NORTHWESTERN ENERGY, L.L.C., a
Montana limited liability company ("Transferor"), pursuant to the Asset and
Stock Transfer Agreement, dated as of November 15, 2002, between Transferor and
Transferee (the "Agreement;" all capitalized terms used but not defined herein
shall have the meanings ascribed to such terms in the Agreement) that:
(i) The undersigned is the duly elected [___________________] of
Transferee and is duly authorized to execute and deliver this certificate on
behalf of Transferee; and
(ii) Each of the conditions precedent to the obligations of Transferee
set forth in Section 7 of the Agreement have been satisfied properly waived to
the satisfaction of Transferee on and as of the date hereof.
November 15, 2002
"TRANSFEREE"
NORTHWESTERN CORPORATION,
(a Delaware corporation)
By: ___________________________________
Name: ____________________________
Title: ____________________________
Exhibit H2-1