Exhibit 10.1

 
 
 
 
 
 
 
 
 
ASSET PURCHASE AGREEMENT
 
by and between
 
Pivotal Utility Holdings, Inc.
 
as Seller,
 
and
 
South Jersey Industries, Inc.
 
as Buyer
 
Dated as of October 15, 2017

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TABLE OF CONTENTS
 
Page
Article I DEFINITIONS
1

Section 1.1.
Definitions
1

Section 1.2.
Other Interpretive Matters
13

Article II PURCHASE AND SALE
14

Section 2.1.
Transaction
14

Section 2.2.
Purchased Assets
14

Section 2.3.
Excluded Assets
16

Section 2.4.
Assumed Obligations
18

Section 2.5.
Excluded Liabilities
19

Section 2.6.
Consents to Assignment
19

Article III PURCHASE PRICE
20

Section 3.1.
Purchase Price
20

Section 3.2.
Working Capital Adjustment
20

Section 3.3.
No Duplication
22

Article IV THE CLOSING
22

Section 4.1.
Time and Place of Closing
22

Section 4.2.
Closing Payment
23

Section 4.3.
Seller’s Closing Deliveries
23

Section 4.4.
Buyer’s Closing Deliveries
23

Article V REPRESENTATIONS AND WARRANTIES OF SELLER
24

Section 5.1.
Organization and Good Standing
24

Section 5.2.
Authority and Enforceability
24

Section 5.3.
No Conflicts; Consents
24

Section 5.4.
Financial Information
25

Section 5.5.
Absence of Certain Changes
26

Section 5.6.
Title
26

Section 5.7.
Material Contracts
26

Section 5.8.
Legal Proceedings
27

Section 5.9.
Compliance with Law; Orders; Permits
27

Section 5.10.
Real Property
27

Section 5.11.
Environmental Matters
28

Section 5.12.
Taxes
29

Section 5.13.
Employee Benefits
30

Section 5.14.
Employment Matters
30

Section 5.15.
No Undisclosed Liabilities
31

Section 5.16.
Brokers and Finders
31

Section 5.17.
Exclusivity of Representations and Warranties
31

Article VI REPRESENTATIONS AND WARRANTIES OF BUYER
31

Section 6.1.
Organization and Good Standing
31

Section 6.2.
Authority and Enforceability
32

Section 6.3.
No Conflicts; Consents
32

Section 6.4.
Financial Capability
33

Section 6.5.
Brokers and Finders
33

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Section 6.6.
Legal Proceedings
33
Section 6.7.
Investigation by Buyer
33
Article VII COVENANTS OF THE PARTIES
34
Section 7.1.
Conduct of the Business
34
Section 7.2.
Access
35
Section 7.3.
Confidentiality by Buyer to Seller
36
Section 7.4.
Confidentiality by Seller to Buyer
37
Section 7.5.
Transition Services
37
Section 7.6.
Expenses
37
Section 7.7.
Further Assurances; Wrong Pockets
37
Section 7.8.
Governmental Approvals
39
Section 7.9.
Tax Matters
41
Section 7.10.
Employees
44
Section 7.11.
Employee Benefits
45
Section 7.12.
Signage
48
Section 7.13.
Insurance Settlement; Cooperation
49
Section 7.14.
Notification of Customers
49
Section 7.15.
Public Statements
49
Section 7.16.
Supplements to Seller Disclosure Schedules
49
Section 7.17.
Collections; Remittances
50
Section 7.18.
Post-Closing Covenants Related to Elizabethtown Gas Name
50
Section 7.19.
Replacement of Guarantees or Other Credit Support
50
Section 7.20.
Financing Covenant
50
Article VIII CONDITIONS TO CLOSING
51
Section 8.1.
Conditions to Each Party’s Closing Obligations
51
Section 8.2.
Conditions to Buyer’s Closing Obligations
51
Section 8.3.
Conditions to Seller’s Closing Obligations
52
Article IX INDEMNIFICATION
52
Section 9.1.
Survival of Representations, Warranties, and Certain Covenants
52
Section 9.2.
Indemnification
53
Section 9.3.
Indemnification Procedures
53
Section 9.4.
Limitations on Indemnification and Related Matters
55
Section 9.5.
Mitigation
56
Section 9.6.
Tax Treatment of Indemnity Payments
57
Section 9.7.
No Consequential Damages
57
Section 9.8.
Exclusive Remedy
57
Article X TERMINATION AND OTHER REMEDIES
58
Section 10.1.
Termination
58
Section 10.2.
Procedure; Effect of Termination; Termination Fee
58
Article XI MISCELLANEOUS PROVISIONS
60
Section 11.1.
Amendment
60
Section 11.2.
Waivers and Consents
61
Section 11.3.
Notices
61
Section 11.4.
Assignment
62
Section 11.5.
No Third Party Beneficiaries
62
Section 11.6.
Governing Law
62

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Section 11.7.
Severability
63

Section 11.8.
Entire Agreement
63

Section 11.9.
Delivery
63

Section 11.10.
Waiver of Jury Trial
63

Section 11.11.
Submission to Jurisdiction
63

Section 11.12.
Specific Performance
64

Section 11.13.
Disclosure Generally
64

Section 11.14.
“As Is” Sale; Release
64

Section 11.15.
Liability of Financing Sources
65

 
APPENDICES AND EXHIBITS*
 
Exhibit A
-
Form of Assignment of Easements
 
 
 
Exhibit B
-
Form of Assignment of Leases
 
 
 
Exhibit C
-
Form of Bill of Sale, Assignment and Assumption Agreement
 
 
 
Exhibit D
-
Form of Deeds

*These exhibits have been omitted pursuant to Item 601(b)(2) of Regulation S-K.
A copy of these exhibits will be furnished supplementally to the Securities and
Exchange Commission upon request.

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ASSET PURCHASE AGREEMENT
 
THIS ASSET PURCHASE AGREEMENT (“Agreement”) is made and entered into as of
October 15, 2017, by and between Pivotal Utility Holdings, Inc., a New Jersey
corporation (“Seller”), and South Jersey Industries, Inc., a New Jersey
corporation (“Buyer” and together with Seller, the “Parties” and each
individually a “Party”).
 
Recitals
 
WHEREAS, Seller owns the Purchased Assets (as defined below), which constitute
the Elizabethtown Gas operating division of Seller; and
 
WHEREAS, upon the terms and subject to the conditions set forth in this
Agreement, Seller desires to sell to Buyer, and Buyer desires to purchase from
Seller, the Purchased Assets and Seller desires to assign to Buyer, and Buyer
desires to assume from Seller, the Assumed Obligations (as defined below).
 
NOW, THEREFORE, in consideration of the representations, warranties, covenants
and agreements contained herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Parties agree as
follows:
 
ARTICLE I
 
DEFINITIONS
 
Section 1.1.          Definitions.
 
(a)                As used in this Agreement, the following terms have the
meanings specified in this Section 1.1(a):
 
“2017/2018 Budget” has the meaning set forth in Section 7.1(d).
 
“ABO” has the meaning set forth in Section 7.11(d).
 
“Accounting Firm” has the meaning set forth in Section 3.2(c).
 
“Acquisition” has the meaning set forth in Section 10.2(e).
 
“Affiliate” has the meaning set forth in Rule 12b-2 of the General Rules and
Regulations under the Securities Exchange Act of 1934, as amended.
 
“Allocation Schedule” has the meaning set forth in Section 7.9(a).
 
“Ancillary Agreements” means the Bill of Sale, each Assignment of Easements,
each Assignment of Leases, the Deed and each other instrument, certificate or
document contemplated to be executed or delivered by any Party in connection
with the transactions contemplated by this Agreement.
 
“APBO” has the meaning set forth in Section 7.11(e).

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“Assigned IP” has the meaning set forth in Section 2.2(f).
 
“Assignment of Easements” means the assignment and assumption of Seller’s right,
title and interest in the Conveyed Easements to be executed and delivered by
Seller at the Closing, substantially in the form attached hereto as Exhibit A.
 
“Assignment of Leases” means the assignment of the Leases, to be executed and
delivered by Seller and Buyer at the Closing, substantially in the form attached
hereto as Exhibit B.
 
“Assumed Obligations” has the meaning set forth in Section 2.4.
 
“Balance Sheet” has the meaning set forth in Section 5.4(a).
 
“Base Purchase Price” has the meaning set forth in Section 3.1.
 
“Benefit Plan” has the meaning set forth in Section 5.13(a).
 
“Bill of Sale” means the bill of sale, assignment and assumption agreement to be
executed and delivered by Seller and Buyer at the Closing, substantially in the
form attached hereto as Exhibit C.
 
“Business” means the business and operations of the Elizabethtown Gas operating
division of Seller, as currently conducted by Seller.
 
“Business Agreement” means any contract, agreement, real or personal property
lease, commitment, understanding, or instrument to which Seller or any Affiliate
of Seller is a party, whether oral or written, that relates primarily to the
Business, the Purchased Assets, or the Assumed Obligations.
 
“Business Confidential Information” has the meaning set forth in Section 7.3(a).
 
“Business Day” means any day other than Saturday, Sunday, or any day on which
banks in the City of New York are authorized by Law to close.
 
“Business Employee” means an employee of Seller or its Affiliates who is
employed as of the Effective Date and whose work responsibilities relate
primarily to the Business, as set forth on Schedule 7.10(a) as it may be updated
from time to time.
 
“Buyer Indemnified Representation” has the meaning set forth in Section 9.1.
 
“Buyer” has the meaning set forth in the introductory paragraph hereto.
 
“Buyer Benefit Plan” has the meaning set forth in Section 7.11(a).
 
“Buyer Indemnitees” has the meaning set forth in Section 9.2(a).
 
“Buyer Pension Plan” has the meaning set forth in Section 7.11(d).

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“Buyer Required Regulatory Approvals” means the approvals set forth on Schedule
1.1(a), which shall include compliance with and filings under the requirements
of the HSR Act.
 
“Buyer VEBA” has the meaning set forth in Section 7.11(e).
 
“Buyer’s Representatives” means Buyer’s accountants, employees, counsel,
environmental consultants, financial advisors, and other Representatives.
 
“Cash and Cash Equivalents” means all cash, bank accounts, certificates of
deposit, commercial paper, treasury bills and notes, marketable securities and
other cash equivalents of the Business, and all other items included as cash or
cash equivalents on the Financial Statements.
 
“Claims” means any and all administrative, regulatory, judicial or arbitration
actions or causes of action, suits, petitions, proceedings (including
arbitration proceedings), investigations, hearings, demands, demand letters,
claims, or notices of noncompliance or violation delivered by any Governmental
Entity or other Person.
 
“Closing” has the meaning set forth in Section 4.1.
 
“Closing Statement” has the meaning set forth in Section 3.2(b).
 
“Closing Working Capital” has the meaning set forth in Section 3.2(b).
 
“COBRA” means the Consolidated Omnibus Budget Reconciliation Act of 1985, as
amended.
 
“COBRA Continuation Coverage” means the continuation of medical coverage
required under sections 601 through 608 of ERISA, and section 4980B of the Code
and any comparable continuation of medical coverage required by applicable state
or local Law.
 
“Code” means the Internal Revenue Code of 1986, as amended.
 
“Confidential Information” has the meaning set forth in Section 7.3(a).
 
“Confidentiality Agreement” means the Confidentiality Agreement, dated as of
August 31, 2017, as amended, between Southern Company Gas and Buyer.
 
“Continuation Period” has the meaning set forth in Section 7.11(a).
 
“Continuing Guarantees” has the meaning set forth in Section 7.19.
 
“Conveyed Easements” has the meaning set forth in Section 2.2(a)(i).
 
“Current Assets” means the current assets of the Business as of the Effective
Time, including billed and unbilled revenues, inventory (including Gas
Inventory), prepaid expenses, any account balances related to the Hedge
Agreements and other items that would be classified as “current assets” on the
Financial Statements, as well as the other assets identified on Schedule

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1.1(g), in each case, determined in accordance with, and subject to, the
Principles applicable to determining the Working Capital; provided, however,
that “Current Assets” shall not include Cash and Cash Equivalents, any other
asset that does not constitute a Purchased Asset or any other asset included in
“current assets” on the Financial Statements that are specifically excluded from
“Current Assets” on Schedule 1.1(g).

“Current Liabilities” means the current liabilities of the Business as of the
Effective Time, including accounts payable and accrued expenses, any liabilities
related to the Hedge Agreements and other items that would be classified as
“current liabilities” on the Financial Statements, as well as the other
liabilities identified on Schedule 1.1(g), in each case, determined in
accordance with, and subject to, the Principles; provided, however, that
“Current Liabilities” shall not include Excluded Liabilities or any other
liabilities included in “current liabilities” on the Financial Statements that
are specifically excluded from “Current Liabilities” on Schedule 1.1(g).
 
“Deed” means the deeds to be executed and delivered by Seller at the Closing
with respect to the Owned Real Property, substantially in the form attached
hereto as Exhibit D.
 
“Direct Loss” has the meaning set forth in Section 9.3(d).
 
“Documents” means the files, documents, client lists, instruments, papers,
books, reports, purchase orders, invoices, copies of cancelled checks,
accounting records, regulatory filings including in respect of general or other
rate cases (and all filings and correspondence with the NJBPU), operating data
and plans, mapping records, technical documentation (such as design
specifications, functional requirements, and operating instructions), user
documentation (such as installation guides, user manuals, and training
materials), and other similar materials, in any form, to the extent in the
possession or control of Seller and to the extent related primarily to the
Purchased Assets, the Assumed Obligations or the Business; provided, that
“Documents” does not include: (i) any of the foregoing to the extent primarily
related to any Excluded Asset or Excluded Liability; (ii) information which, if
provided to Buyer, would violate any applicable Law or Order; (iii) any
valuations related to the sale of the Business, the Purchased Assets, or the
Assumed Obligations; (iv) any and all materials not relating primarily to the
Business; (v) any materials protected by attorney-client privilege or other
legal privilege; (vi) copies of materials archived or backed up in accordance
with normal procedures; and (vii) Tax Returns and any related or supporting
information.
 
“Easements” means all easements, license agreements, railroad crossing rights,
rights-of-way, leases for rights-of-way, and similar use and access rights
related to the Purchased Assets or Business.
 
“Effective Date” has the meaning set forth in Section 4.1.
 
“Effective Date Payment” has the meaning set forth in Section 3.1(a).
 
“Effective Time” has the meaning set forth in Section 4.1.
 
“Encumbrances” means any mortgages, pledges, liens, claims, charges, security
interests, conditional and installment sale agreements, activity and use
limitations, Easements, covenants,

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encumbrances, obligations, limitations, title defects, deed restrictions,
preferential purchase rights or options, and any other restrictions of any kind,
including restrictions on use, transfer, receipt of income, or exercise of any
other attribute of ownership.

“Environment” means all or any of the following media: soil, land surface and
subsurface strata, surface waters (including navigable waters, streams, ponds,
drainage basins, and wetlands), groundwater, drinking water supply, stream
sediments, ambient air (including the air within buildings and the air within
other natural or man-made structures above or below ground), plant and animal
life, and any other natural resource.
 
“Environmental Claims” means any and all Claims arising pursuant to any
Environmental Laws or Environmental Permits, or arising from the presence,
Release, or threatened Release (or alleged presence, Release, or threatened
Release) into the Environment of any Hazardous Materials, including any and all
Claims by any Governmental Entity or by any Person for enforcement, cleanup,
remediation, removal, response, remedial or other actions or damages,
contribution, indemnification, cost recovery, compensation, or injunctive relief
pursuant to any Environmental Law.
 
“Environmental Laws” means any and all Laws regulating or relating to, or
imposing liability with respect to, pollution or the protection of human health,
safety, the Environment, or damage to natural resources, including Laws relating
to Releases and threatened Releases or otherwise relating to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport, or
handling of Hazardous Materials. Environmental Laws include, but are not limited
to, the Comprehensive Environmental Response, Compensation, and Liability Act,
42 U.S.C. § 9601 et seq. (“CERCLA”); the Federal Insecticide, Fungicide and
Rodenticide Act, 7 U.S.C. § 136 et seq.; the Resource Conservation and Recovery
Act, 42 U.S.C. § 6901, et seq.; the Toxic Substances Control Act, 15 U.S.C. §
2601 et seq.; the Clean Air Act, 42 U.S.C. § 7401 et seq.; the Federal Water
Pollution Control Act, 33 U.S.C. § 1251 et seq.; the Oil Pollution Act, 33
U.S.C. § 2701 et seq.; the Endangered Species Act, 16 U.S.C. § 1531 et seq.; the
National Environmental Policy Act, 42 U.S.C. § 4321, et seq.; the Occupational
Safety and Health Act, 29 U.S.C. § 651 et seq.; the Safe Drinking Water Act, 42
U.S.C. § 300f et seq.; the Emergency Planning and Community Right-to-Know Act,
42 U.S.C. § 11001 et seq.; the Atomic Energy Act, 42 U.S.C. § 2014 et seq.; the
Nuclear Waste Policy Act, 42 U.S.C. § 10101 et seq.; the Protecting our
Infrastructure of Pipelines and Enhancing Safety Act, 49 U.S.C. 60101 et. seq.
and their state and local counterparts or equivalents, all as amended from time
to time, and regulations issued pursuant to any of those Laws.
 
“Environmental Permits” means all permits, registrations, certifications,
licenses, franchises, exemptions, approvals, consents, waivers, water rights or
other authorizations of Governmental Entities issued under or with respect to
applicable Environmental Laws and used or held by Seller for the operation of
the Business.
 
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended,
and the rules and regulations promulgated thereunder.
 
“ERISA Affiliate” means any Person or entity that together with Seller would be
deemed to be under common control within the meaning of section 414(b), (c), (m)
or (o) of the Code.

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“Estimated Closing Statement” has the meaning set forth in Section 3.2(a).
 
“Estimated Closing Working Capital” means Seller’s good faith estimate of the
Closing Working Capital calculated in accordance with the Principles.
 
“Excluded Assets” has the meaning set forth in Section 2.3.
 
“Excluded Liabilities” has the meaning set forth in Section 2.5.
 
“Financial Statements” has the meaning set forth in Section 5.4(a).
 
“Financing” means any financing transaction to be entered into by Buyer or its
Affiliates in connection with the transactions contemplated hereby.
 
“Financing Sources” means the agents, arrangers, lenders and other entities that
have committed to provide or arrange the Financing or other financings in
connection with the transactions contemplated by this Agreement, together with
their respective Affiliates and their and their respective Affiliates’ current,
former or future officers, directors, employees, partners, trustees,
shareholders, equity holders, managers, members, limited partners, controlling
persons, agents, advisors and representatives and respective successors and
assigns of the foregoing Persons.
 
“Franchises” has the meaning set forth in Section 5.7(a)(i).
 
“GAAP” means United States generally accepted accounting principles, applied on
a consistent basis.
 
“GAS Affiliate” means Southern Company Gas and all of its direct and indirect
subsidiaries.
 
“Gas Inventory” means the book value of the inventory of natural gas and natural
gas products located in Seller’s facilities or in facilities contracted or
leased by Seller that are included in the Purchased Assets, determined as of a
particular date in accordance with, and subject to, the Principles.
 
“Governing Documents” of a Party means the articles or certificate of
incorporation and bylaws, or comparable governing documents, of such Party.
 
“Governmental Entity” means the United States of America and any other federal,
state, local, or foreign governmental or regulatory authority, department,
agency, commission, body, court, or other governmental entity.
 
“Guarantees” has the meaning set forth in Section 7.19.
 
“Hazardous Material” means (i) any chemicals, materials, substances, or wastes
which are now or hereafter defined as or included in the definition of
“hazardous substance,” “hazardous material,” “hazardous waste,” “solid waste,”
“toxic substance,” “extremely hazardous substance,” “pollutant,” “contaminant,”
or words of similar import under any

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applicable Environmental Laws; (ii) any petroleum, petroleum products (including
crude oil or any fraction thereof), natural gas, natural gas liquids, liquefied
natural gas or synthetic gas useable for fuel (or mixtures of natural gas and
such synthetic gas), or oil and gas exploration or production waste,
polychlorinated biphenyls, asbestos-containing materials, mercury, and
lead-based paints; and (iii) any other chemical, material, substances, waste, or
mixture thereof which is prohibited, limited, or regulated by Environmental
Laws.

“Hedge Agreements” has the meaning set forth in Section 2.2(h).
 
“Holdback Property” has the meaning set forth in Section 7.7(c).
 
“HSR Act” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended.
 
“Indemnifiable Loss” has the meaning set forth in Section 9.2(a).
 
“Indemnification Cap” has the meaning set forth in Section 9.3(a).
 
“Indemnifying Party” has the meaning set forth in Section 9.3(a).
 
“Indemnitee” has the meaning set forth in Section 9.3(a).
 
“Intellectual Property” means (i) any U.S. or foreign patents, copyrights,
trademarks, maskworks, and other similar intangible rights throughout the world,
and applications or registrations for any of the foregoing, (ii) any protectable
or proprietary interest, whether registered or unregistered, in know how, trade
secrets, database rights, software, operating and manufacturing procedures,
designs, specifications and the like, (iii) any protectable or proprietary
interest in any similar intangible asset of a technical, scientific or creative
nature, and (iv) any protectable or proprietary interests in or to any documents
or other tangible media containing any of the foregoing.
 
“Inventory” has the meaning set forth in Section 2.2(a)(iii).
 
“ISRA” means Industrial Site Recovery Act, N.J.S.A. 13:1K-6 et seq. and the
rules and regulations promulgated thereunder.
 
“IT Assets” has the meaning set forth in Section 2.2(a)(vii).
 
“Labor Agreement” has the meaning set forth in Section 5.13(e).
 
“Law” means any statutes, regulations, rules, ordinances, codes, and similar
acts or promulgations of any Governmental Entity.
 
“Leases” has the meaning set forth in Section 2.2(a)(i).
 
“Leased Real Property” means the real property in which Seller holds a leasehold
interest under a Lease.

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“Loss” or “Losses” means losses, liabilities, damages, obligations, payments,
penalties, costs, and expenses (including, without limitation, the costs and
expenses of any and all actions, suits, proceedings, assessments, judgments,
settlements, and compromises relating thereto, reasonable attorneys’ fees,
reasonable disbursements, interest, penalties and all expenses incurred in
investigating, preparing or defending against any litigation commenced or
threatened or any Claim or Order in connection therewith).
 
“Material Adverse Effect” means a material adverse effect on (a) the business,
assets, properties, results of operations, or condition (financial or otherwise)
of the Business, taken as a whole, or (b) the ability of Seller to perform its
obligations under this Agreement and consummate the transactions contemplated
hereby on a timely basis; provided, however, that, in the case of clause (a)
only, (1) the determination of Material Adverse Effect shall take into account
any payment, indemnification or other obligation that Seller agrees to make,
provide or assume in order to cure or mitigate any such effect and (2) Material
Adverse Effect shall not include any fact, circumstance, effect, change, event
or development that results from or arises out of (i) the announcement or
pendency of this Agreement and the transactions contemplated hereby (including,
but not limited to, any adverse effect resulting from any action by a
Governmental Entity taken in connection with the Required Regulatory Approvals),
(ii) any change in the conditions in the international, national or regional
economy, financial markets, capital markets or commodities markets, including
changes in interest rates or exchange rates, (iii) any change in international,
national, regional, or local regulatory or political conditions, (iv) any change
in Law, regulation or accounting principle (or authoritative interpretation
thereof), (v) any change in GAAP or in the generally applicable principles used
in the preparation of the financial statements as required by the NJBPU, (vi)
any changes or developments in national, regional, state or local wholesale or
retail markets for natural gas or related products including those due to
actions by competitors or due to changes in commodities prices or hedging
markets therefor, (vii) any changes or developments in national, regional, state
or local natural gas transmission or distribution systems, (viii) any changes or
developments in national, regional, state, or local wholesale or retail natural
gas prices, (ix) acts expressly permitted by this Agreement or consented to or
requested by Buyer, (x) geopolitical conditions, the outbreak or escalation of
hostilities, any acts of war, sabotage or terrorism, or any escalation or
worsening of any such acts of war, sabotage or terrorism, (xi) any failure to
meet any internal or published projections, forecasts, estimates or predictions
in respect of recoveries, revenues, earnings or other financial or operating
metrics for any period and (xii) any changes in weather or climate or acts of
God; provided further, that with respect to clauses (ii)-(viii) and (x), such
impact shall be excluded only to the extent it is not disproportionately adverse
to the Business, taken as a whole, as compared to other businesses operating in
the same industry.
 
“Material Contracts” has the meaning set forth in Section 5.7(a).
 
“NJBPU” means the New Jersey Board of Public Utilities.
 
“Notice of Disagreement” has the meaning set forth in Section 3.2(c).
 
“Order” means any order, decision, judgment, writ, injunction, decree,
directive, or award of a court, administrative judge, or other Governmental
Entity acting in an adjudicative or

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regulatory capacity, or of an arbitrator with applicable jurisdiction over the
subject matter and is inclusive of any Regulatory Order.

“Ordinary Course Update” has the meaning set forth in Section 7.16.
 
“Other Indemnified Matters” has the meaning set forth in Section 7.13(b).
 
“Owned Real Property” has the meaning set forth in Section 2.2(a)(i).
 
“Party” has the meaning set forth in the introductory paragraph hereto.
 
“Pension Participant” means all persons (i) whose work responsibilities related
primarily to the Business, (ii) who was a participant in the Seller Pension Plan
and (iii) who retired or whose employment with Seller or its Affiliates
terminated for any reason prior to or as of the Closing (including the
Transferred Employees).
 
“Permits” means all permits, certifications, licenses, franchises, exemptions,
approvals, consents, waivers or other authorizations of Governmental Entities
issued under or with respect to applicable Laws or Orders and used or held by
Seller for the operation of the Business or the Purchased Assets, other than
Environmental Permits.
 
“Permitted Encumbrances” means (i) those Encumbrances set forth in Schedule
1.1(b); (ii) statutory liens for Taxes or assessments not yet due or delinquent
or the validity or amount of which is being contested; (iii) mechanics’,
carriers’, workers’, repairers’, landlords’, and other similar liens arising or
incurred in the ordinary course of business consistent with past practice
relating to obligations as to which there is no default on the part of Seller or
that are not individually or in the aggregate material in amount or to the
Business or the Purchased Assets, taken as a whole, and the validity or amount
of which is being contested in good faith by appropriate proceedings, or
pledges, deposits, or other liens securing the performance of bids, trade
contracts, leases, or statutory obligations (including workers’ compensation,
unemployment insurance, or other social security legislation); (iv) zoning,
entitlement, restriction, and other land use and environmental regulations by
Governmental Entities; (v) all rights of any person under condemnation, eminent
domain, or other similar proceedings which are pending or threatened in writing
prior to the Effective Date; (vi) all Encumbrances arising under approvals
relating to the Business or Purchased Assets which have been issued by any
Governmental Entities; (vii) Encumbrances existing under or as a result of (A)
any leases of Real Property identified in the Seller Disclosure Schedules or (B)
leases, subleases, licenses or other agreements which do not constitute Material
Contracts; and (viii) Encumbrances created by or through Buyer as of the
Closing; provided, however, in the case of (v) and (vi) above, such Encumbrances
shall be Permitted Encumbrances so long as they do not prohibit or materially
interfere with the operations of the Real Property as currently operated and do
not render title to the Owned Real Property unmarketable.
 
“Person” means any individual, partnership, limited liability company, joint
venture, corporation, trust, unincorporated organization, or Governmental
Entity.
 
“Post-Closing Taxes” means all Taxes related to the Purchased Assets and
Business for all Taxable Periods or portions thereof other than Pre-Closing Tax
Periods.

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“Pre-Closing Taxes” means all Taxes related to the Purchased Assets and Business
for all Pre-Closing Tax Periods.
 
“Pre-Closing Tax Period” means any Taxable Period ending at or before the
Effective Time and the portion of any Straddle Tax Period ending at the
Effective Time.
 
“Principles” has the meaning set forth in Section 3.2(a).
 
“Purchased Assets” has the meaning set forth in Section 2.2.
 
“Purchased Business Agreements” has the meaning set forth in Section 2.2(b).
 
“Purchase Price” means (i) the Base Purchase Price plus (ii) the Closing Working
Capital.
 
“Qualifying Offer” has the meaning set forth in Section 7.10(b).
 
“Real Property” has the meaning set forth in Section 2.2(a)(i).
 
“Regulatory Order” means an Order issued by the NJBPU that affects or governs
the rates, services, or other utility operations of the Business.
 
“Release” means any spilling, leaking, pumping, pouring, emitting, emptying,
discharging, injecting, escaping, leaching, dumping, or disposing of Hazardous
Materials into the Environment.
 
“Represented Employees” has the meaning set forth in Section 7.10(a).
 
“Representatives” means, with respect to any Person, the officers, directors,
employees, agents, accountants, advisors, bankers and other representatives of
such Person.
 
“Required Regulatory Approvals” means the Seller Required Regulatory Approvals
and the Buyer Required Regulatory Approvals.
 
“Retained Agreements” has the meaning set forth in Section 2.3(e).
 
“Retained Business” means all businesses and operations of Seller and its
Affiliates (other than the Business), including the business of acquiring,
owning, and managing generation assets, including renewable energy projects, and
selling electricity at market-based rates in the wholesale market as currently
conducted by Seller and its Affiliates.
 
“Sample Statement” has the meaning set forth in Section 1.1(a).
 
“Schedule Update” has the meaning set forth in ‎Section 7.16.
 
“Section 414(l) Amount” has the meaning set forth in Section 7.11(d).
 
“Seller” has the meaning set forth in the introductory paragraph hereto.

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“Seller Disclosure Schedules” means, collectively, all of the Schedules
delivered by Seller to Buyer in connection with this Agreement.
 
“Seller Indemnified Representation” has the meaning set forth in Section 9.1.
 
“Seller Indemnitees” has the meaning set forth in Section 9.2(b).
 
“Seller Marks” means all registered and unregistered trademarks, service marks,
trade names, logos, Internet domain names and any applications for registration
of any of the foregoing, together with all goodwill associated with each of the
foregoing (“Trademarks”), owned or used by Seller or its Affiliates, including
all Trademarks that include the term “Southern Company Gas” or “AGL Resources”
and all Trademarks related thereto or containing or comprising the foregoing,
including any Trademarks confusingly similar thereto or dilutive thereof
(including any word or expression similar thereto or constituting an
abbreviation or extension thereof); provided, however, “Seller Marks” shall not
include the trademark “Elizabethtown Gas.”
 
“Seller Pension Plan” has the meaning set forth in Section 7.11(d).
 
“Seller Required Regulatory Approvals” means the approvals set forth on Schedule
1.1(d), which shall include compliance with and filings under the requirements
of the HSR Act.
 
“Seller’s 401(k) Plan” has the meaning set forth in Section 7.11(c).
 
“Seller’s Knowledge”, or words to similar effect, means the actual (and not
constructive or imputed) knowledge of any individual listed on in Schedule
1.1(e).
 
“Seller’s Representatives” means Seller’s accountants, employees, counsel,
environmental consultants, financial advisors, managers and other
Representatives.
 
“Straddle Tax Period” means any Taxable Period that begins at or before the
Effective Time and ends after the Effective Time.
 
“Survival Period” has the meaning set forth in Section 9.1.
 
“Tax” and “Taxes” means all federal, state, local, foreign and other income,
gross receipts, sales, use, production, ad valorem, transfer, documentary,
franchise, registration, profits, license, lease, service, service use,
withholding, payroll, employment, unemployment, estimated, excise, severance,
environmental, stamp, occupation, premium, property (real or personal), real
property gains, windfall profits, customs, duties or other taxes, fees,
assessments or charges of any kind whatsoever, together with any interest,
additions or penalties with respect thereto and any interest in respect of such
additions or penalties, whether disputed or not, including any obligation to
indemnify or otherwise discharge any Tax liability of any other Person.
 
“Taxable Period” means any taxable year or other period with respect to which
any Tax may be imposed under any applicable statute, rule or regulation.

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“Tax Contest” has the meaning set forth in Section 5.12(b).
 
“Tax Dispute Referee” has the meaning set forth in Section 7.9(a).
 
“Tax-Exempt Bonds” means tax-exempt bonds set forth on Schedule 1.1(j) issued or
created in connection with the Business.
 
“Tax Return” means any return, report, election, declaration, information
return, or other document, including any schedules thereto or amendments
thereof, provided or required to be filed with any Governmental Entity with
respect to Taxes.
 
“Termination Date” has the meaning set forth in Section 10.1(b).
 
“Termination Fee” has the meaning set forth in Section 10.2(c).
 
“Territory” means the service territory described in Schedule 1.1(f).
 
“Third Party Claim” has the meaning set forth in Section 9.3(a).
 
“Third Party Claim Notice” has the meaning set forth in Section 9.3(a).
 
“Threshold Amount” has the meaning set forth in Section 9.4(b)(i).
 
“Transferable Permits” has the meaning set forth in Section 2.2(c).
 
“Transfer Date” has the meaning set forth in Section 7.11(d).
 
“Transferred Employee” has the meaning set forth in Section 7.10(b).
 
“Transfer Taxes” means any excise, transfer (including real property transfer),
documentary, sales, use, value added, stamp, registration, conveyance, filing
and recording fees and charges and other similar Taxes, including any interest,
penalties, or additions with respect thereto.
 
“Vehicles” has the meaning set forth in Section 2.2(a)(v).
 
“WARN Act” means the federal Worker Adjustment Retraining and Notification Act
of 1988, as amended, and similar state or local laws related to plant closing,
relocations and mass layoffs.
 
“Welfare Trust” has the meaning set forth in Section 7.11(e).
 
“Willful Breach” has the meaning set forth in Section 10.2(e).
 
“Working Capital” means, (a) Current Assets, minus (b) Current Liabilities, in
each case, as of the Effective Time, calculated in accordance with the
Principles applicable to the Working Capital calculation; provided, that
“Working Capital” shall not include any expense or liability for any Taxes or
any refund, credit, or other asset relating to any Taxes. Schedule 1.1(g) sets

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forth a sample calculation of the Working Capital as of December 31, 2016 (the
“Sample Statement”).

Section 1.2.          Other Interpretive Matters. Unless otherwise expressly
provided, for purposes of this Agreement, the following rules of interpretation
apply:
 
(a)                Appendices, Exhibits and Schedules. Unless otherwise
expressly indicated, any reference in this Agreement to an “Appendix,” “Exhibit”
or “Schedule” refers to an Appendix, Exhibit or Schedule to this Agreement. The
Appendices, Exhibits and Schedules to this Agreement are hereby incorporated and
made a part hereof as if set forth in full herein and are an integral part of
this Agreement. Any capitalized terms used in any Appendix, Exhibit or Schedule
but not otherwise defined therein are defined as set forth in this Agreement. In
the event of conflict or inconsistency, this Agreement and the Appendices shall
prevail over any Exhibit or Schedule.
 
(b)               Time Periods. When calculating the period of time before
which, within which, or following which any act is to be done or step taken
pursuant to this Agreement, the date that is the reference date in calculating
such period will be excluded. If the last day of such period is a non-Business
Day, the period in question will end on the next succeeding Business Day.
 
(c)                Gender and Number. Whenever the context requires, the gender
of all words used in this Agreement includes the masculine, feminine, and
neuter, and the singular includes the plural, and the plural includes the
singular.
 
(d)                Certain Terms. The words such as “herein,” “hereinafter,”
“hereof,” and “hereunder” refer to this Agreement (including the Appendices,
Exhibits and Schedules to this Agreement) as a whole and not merely to a
subdivision in which such words appear unless the context otherwise requires.
The word “including” or any variation thereof means “including, without
limitation” and does not limit any general statement that it follows to the
specific or similar items or matters immediately following it. The word
“willful” means intentional and malicious. The words “to the extent” when used
in reference to a liability or other matter, means that the liability or other
matter referred to is included in part or excluded in part, with the portion
included or excluded determined based on the portion of such liability or other
matter exclusively related to the subject or period. The word “or” shall be
disjunctive but not exclusive. A reference to any party to this Agreement or any
other agreement or document shall include such party’s successors and permitted
assigns. A reference to any legislation or to any provision of any legislation
shall include any amendment to, and any modification or reenactment thereof, any
legislative provision substituted therefor and all regulations and statutory
instruments issued thereunder or pursuant thereto. The phrase “ordinary course
of business” refers to the ordinary course of business of the Business and not
of Seller and its Affiliates generally.
 
(e)                Headings. The division of this Agreement into Articles,
Sections, and other subdivisions, and the insertion of headings are for
convenience of reference only and do not affect, and will not be utilized in
construing or interpreting, this Agreement. All references in this Agreement to
any “Section” are to the corresponding Section of this Agreement unless
otherwise specified.

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(f)                Joint Participation. The Parties have participated jointly in
the negotiation and drafting of this Agreement and, in the event an ambiguity or
question of intent or interpretation arises, this Agreement shall be construed
as jointly drafted by the Parties and no presumption or burden of proof shall
arise favoring or disfavoring any party by virtue of the authorship of any
provision of this Agreement.
 
ARTICLE II 
 
PURCHASE AND SALE
 
Section 2.1.          Transaction. Upon the terms and subject to the
satisfaction of the conditions contained in this Agreement, at the Closing, (i)
Seller will sell, assign, convey, transfer, and deliver (or cause to be sold,
assigned, conveyed, transferred and delivered) to Buyer, and Buyer will purchase
and acquire from Seller (or an Affiliate of Seller, as the case may be), free
and clear of all Encumbrances, including, but not limited to, any Encumbrance
related to the Tax-Exempt Bonds, (except for Permitted Encumbrances), all of
Seller’s or Seller’s Affiliate’s right, title and interest in, to and under the
Purchased Assets and (ii) Buyer will, subject to the terms of this Agreement and
the Ancillary Agreements, assume and become responsible for all of the Assumed
Obligations without recourse to Seller or any of its Affiliates, and thereafter
pay, perform and discharge when due, the Assumed Obligations.
 
Section 2.2.          Purchased Assets. For purposes hereof, the “Purchased
Assets” shall mean the following assets primarily related to, used in, held for
use in or with respect to the Business, as the same exist at the Effective Time
(and, as permitted or contemplated hereby, with such additions and deletions as
shall occur from the date hereof through the Effective Time), except to the
extent that such assets are Excluded Assets:
 
(a)                The following real and personal property, plant and equipment
and related tangible property:
 
(i)                 the fee interests in real property described on Schedule
2.2(a)(i), including buildings, structures, pipelines, other improvements, and
fixtures located thereon (the “Owned Real Property”); the leasehold interests
under the leases described on Schedule 2.2(a)(i) (the “Leases”); and the
Easements described on Schedule 2.2(a)(i) relating to the operation of the
Business, including buildings, structures, pipelines, other improvements and
fixtures located thereon (the “Conveyed Easements” and, all of the foregoing,
the “Real Property”);
 
(ii)                 the natural gas distribution utility system assets used
primarily in the Business, including as described on Schedule 2.2(a)(ii);
 
(iii)                the Gas Inventory of the Business to the extent owned by
Seller as of the Effective Time;
 
(iv)                the parts and other inventory that are held for use
primarily in connection with the Business to the extent owned by Seller or any
of its Affiliates as of the Effective Time (collectively, the “Inventory”);

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(v)                 all motor vehicles, trailers and similar rolling stock used
primarily in the Business, including as described on Schedule 2.2(a)(v), to the
extent owned or leased by Seller or any of its Affiliates as of the Effective
Time (collectively, the “Vehicles”);
 
(vi)               the furnishings, fixtures, machinery, equipment, materials
and other tangible personal property owned by Seller or any of its Affiliates
(other than Inventory, IT Assets and Vehicles) that are located in the Territory
and that are used primarily in connection with the operation of the Business to
the extent owned by Seller as of the Effective Time; and
 
(vii)              the information technology and communications equipment used
primarily in the Business and located in the Territory, including as described
on Schedule 2.2(a)(vii) (“IT Assets”);
 
(b)                the Business Agreements described on Schedule 2.2(b) (the
“Purchased Business Agreements”), subject to Section 7.7(b);
 
(c)                the Permits used or held by Seller primarily in connection
with the Business or the ownership or operation of the Purchased Assets,
including, but not limited to, the items set forth on Schedule 2.2(c), except to
the extent that, any such Permits are prohibited by applicable Law, Order or the
terms of any such Permit from being assigned to Buyer in connection with the
transactions contemplated hereby (the “Transferable Permits”);
 
(d)                all regulatory assets, including under-recovered gas cost
adjustments and recoverable environmental costs;
 
(e)                the Documents;
 
(f)                 the trademark “Elizabethtown Gas” (including any other
trademarks relating to the Business that only include the name “Elizabethtown”
and do not contain the names “Southern”, “Southern Company Gas” or “Pivotal” or
any other trademark owned by Seller), the domain name www.elizabethtowngas.com
and all social media user names/accounts of the Business (including Twitter
(@etowngas) and facebook (@ElizabethtownGas)) (the “Assigned IP”);
 
(g)               all Claims and defenses of Seller or any of its Affiliates
against any Person to the extent such Claims or defenses relate primarily to the
Purchased Assets or the Assumed Obligations, provided such Claims and defenses
will be assigned by Seller or such Affiliate to Buyer without warranty or
recourse;
 
(h)               all assets recorded or reflected on the Balance Sheet and
acquired since the date of the Balance Sheet, including all Current Assets as of
the Effective Time, including all receivables and all credits, prepaid expenses,
advance payments, security deposits, escrows and other prepaid items of Seller
or any of its Affiliates arising from or primarily related to the Business,
provided it will not include cash reserves or prepaid Taxes;

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(i)                 the hedge agreements relating to the Business as set forth
on Schedule 2.2(i) (the “Hedge Agreements”);
 
(j)                 the assets and other rights specifically set forth on
Schedule 2.2(j); and
 
(k)                any other asset, interest or rights of Seller or any of its
Affiliates to the extent related exclusively or primarily to, used exclusively
or primarily in or held for use exclusively or primarily in the Business, except
for Excluded Assets.
 
Section 2.3.          Excluded Assets. The Purchased Assets do not include any
property or assets of Seller other than as described in Section 2.2 and,
notwithstanding any provision to the contrary in Section 2.2 or elsewhere in
this Agreement, the Purchased Assets do not include the following property or
assets of Seller (all assets excluded pursuant to this Section 2.3, the
“Excluded Assets”):
 
(a)                Cash and Cash Equivalents;
 
(b)                certificates of deposit, shares of stock, securities, bonds,
debentures, evidences of indebtedness, and any other debt or equity interest in
any Person;
 
(c)                all assets used by Seller in performing corporate, support,
administrative and other services, which assets are not utilized primarily by
the Business;
 
(d)                all intercompany receivables and loans;
 
(e)                all Business Agreements other than the Purchased Business
Agreements, including, without limitation, those set forth on Schedule 2.3(e)
(the “Retained Agreements”);
 
(f)                 any assets that have been disposed of in the ordinary course
of business and in compliance with this Agreement after the date hereof and
prior to the Effective Time;
 
(g)                all books and records other than the Documents; provided,
that with respect to any such books and records that contain information
pertinent to the Business and the Retained Business, Seller shall permit Buyer
to make copies (at its expense) of such books and records, subject to any
applicable redactions of information that does not relate to the Business;
 
(h)                any Seller Marks and any other Intellectual Property or
rights therein or related to any business of Seller or any of its Affiliates
other than the Business and the Assigned IP;
 
(i)                 any refund or credit, claim for refund or credit or rights
to receive refunds or credits with respect to Taxes paid or payable by or on
behalf of Seller or any Affiliate of Seller, whether such refund is received as
a payment or as a credit, abatement or similar offset against future Taxes
payable (except to the extent any such refund or credit relates to Taxes borne
by Buyer pursuant to Section 7.9);
 
(j)                 except to the extent expressly provided in Section 2.2(g),
all Claims of Seller against any Person;

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(k)                all rights, Claims, credits and defenses to the extent
relating to any other Excluded Asset or any Excluded Liability, including any
such items arising under insurance policies, guarantees, warranties, indemnities
and similar rights in respect of any such Excluded Asset or any Excluded
Liability, whether arising before, on or after the Effective Date;
 
(l)                 all insurance policies, and rights thereunder, including any
such policies and rights in respect of the Purchased Assets, the Assumed
Obligations or the Business and including all insurance recoveries thereunder
and rights to assert claims with respect to any such insurance recoveries,
whether arising before, on or after the Effective Date other than as provided
for in Section 7.13;
 
(m)              (i) all Tax Returns and any related or supporting information,
(ii) Documents prepared in connection with the transactions contemplated hereby,
including bids received from other Persons and analyses relating to the Business
and (iii) file copies of any Documents retained by Seller, in each case, whether
before, on or after the Effective Date;
 
(n)                all rights of Seller or its Affiliates under any
confidentiality, non-use or similar contract, agreement or understanding with
any employee or contractor of Seller or its Affiliates to the extent that such
rights do not primarily relate to the Business, whether arising before, on or
after the Effective Date;
 
(o)                all financial and Tax records relating to the Business and
the Purchased Assets to the extent that they constitute a part of the general
ledger of Seller or any of its Affiliates, whether before, on or after the
Effective Date; provided, that with respect to any such financial and Tax
records that contain information pertinent to the Business and the Retained
Business, Seller shall permit Buyer to make copies (at its expense) of such
books and records, subject to any applicable redactions of information that does
not relate to the Business;
 
(p)                the rights of Seller arising under or in connection with this
Agreement, any certificate or other document delivered in connection herewith,
and any of the transactions contemplated hereby and thereby;
 
(q)                except as otherwise expressly provided in Section 7.10(d),
Section 7.11(d) or Section 7.11(e), all Benefit Plans and all assets under or
relating to any Benefit Plan;
 
(r)                 any properties, assets, goodwill and rights of Seller or any
of its Affiliates of whatever kind and nature, real, personal or mixed, tangible
or intangible that are not used primarily in, or that do not arise primarily out
of, the operation or conduct of the Business, whether arising before, on or
after the Effective Date;
 
(s)                all goodwill of the Business (except, solely for Tax
purposes, to the extent of any amount allocated to goodwill in an Allocation
Schedule);
 
(t)                 any information technology and communications equipment
other than the IT Assets; and
 
(u)                the assets and other rights set forth on Schedule 2.3(u).

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Section 2.4.          Assumed Obligations. On the Effective Date, Buyer will
deliver to Seller the Bill of Sale (and such other documents as may be needed
with respect to specific obligations) pursuant to which Buyer will specifically
assume, as of the Effective Time, the following liabilities and obligations of
Seller, in each case, to the extent related to the Business (the “Assumed
Obligations”):
 
(a)                all accounts payable or other accrued and unpaid current
expenses primarily arising out of or primarily relating to the operation or
conduct of the Business outstanding as of or arising after the Effective Date,
but only to the extent such payables and expenses are included in the
calculation of Closing Working Capital;
 
(b)                all liabilities and obligations of Seller with respect to
over-recovered purchased gas cost adjustment charges, and all customer deposits,
customer advances for construction, deferred credits, regulatory liabilities and
other similar items, in each case primarily related to the Business;
 
(c)                all obligations of Seller under any Regulatory Order
applicable to the Business or the Purchased Assets;
 
(d)                all contractual obligations and commitments under any
Purchased Business Agreement, the Transferable Permits and any other agreements
or contractual rights assigned or transferred to, or assumed by, Buyer, whether
arising before, on or after the Effective Date;
 
(e)                all Post-Closing Taxes; provided, however, Buyer is not
assuming any liabilities for any Pre-Closing Taxes;
 
(f)                 all liabilities, obligations or commitments that relate
primarily to, or that arise primarily out of, any Purchased Asset, or that arise
out of the ownership by Buyer or its subsidiaries of any Purchased Asset or
associated with the realization of the benefits of any Purchased Asset, whether
arising before, on or after the Effective Date;
 
(g)                all liabilities and obligations of Seller or any of its
Affiliates, including, without limitation, those described on Schedule 7.19,
with respect to guarantees by Seller or any of its Affiliates (or instruments
serving a similar function) issued or created for the account of the Business,
whether arising before, on or after the Effective Date;
 
(h)                all liabilities, obligations and commitments, including
financial assurance obligations, relating to the Business or any Purchased
Asset, or attributable to the ownership of the Business or any Purchased Asset,
arising under, based upon, or relating to, any Environmental Law, Environmental
Permit, Environmental Claim or Release of Hazardous Materials, in each case,
whether arising before, on or after the Effective Date, including without
limitation, making any filings and taking all actions necessary after the
Effective Date to achieve full ISRA compliance;
 
(i)                 all liabilities and obligations for which Buyer is expressly
responsible pursuant to Section 7.10(c); and

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(j)                 all other liabilities accruing, arising out of or relating
primarily to the conduct or operation of the Business or the ownership or use of
the Purchased Assets prior to, from and after the Effective Time.
 
Section 2.5.          Excluded Liabilities. Seller acknowledges that the Assumed
Obligations shall not include the following liabilities, obligations and
commitments of Seller (collectively, the “Excluded Liabilities”):
 
(a)                any liabilities or obligations of Seller and its Affiliates
related to or arising out of the Excluded Assets or the Retained Business;
 
(b)                any liabilities or obligations in respect of Pre-Closing
Taxes;
 
(c)                except as otherwise expressly provided in Section 7.10(c),
Section 7.10(d), Section 7.11(d) or Section 7.11(e), any liabilities under or
relating to any Benefit Plan;
 
(d)                all intercompany payables;
 
(e)                any liabilities or obligations arising from or related to the
Other Indemnified Matters, except to the extent contemplated by the common
interest agreement to be entered into by Buyer and Seller as contemplated by
Schedule 7.13(b);
 
(f)                 any liabilities or obligations of Seller arising under or in
connection with this Agreement, the Ancillary Agreements, any certificate or
other document delivered in connection in herewith, and any of the transactions
contemplated hereby and thereby;
 
(g)                any liabilities or obligations of Seller and its Affiliates
in respect of indebtedness for borrowed money or any other notes payable,
including any Tax-Exempt Bonds, except for liabilities included in Working
Capital;
 
(h)               except to the extent otherwise specifically provided herein,
all transaction expenses incurred in connection with this Agreement by Seller,
including costs incurred in connection with the process of selling the Business
or the negotiation, preparation or execution of this Agreement or the Ancillary
Agreements or the performance or consummation of the transactions contemplated
hereby or thereby, including all fees and expenses of counsel, advisors,
consultants, investment bankers, accountants, auditors and any other experts;
and
 
(i)                 any liabilities or obligations of Seller or any of its
Affiliates incurred prior to the Effective Time with respect to any present or
former employees, officers, directors, retirees, independent contractors or
consultants of the Business (including the Business Employees), including any
beneficiaries or dependents of such individuals, for any claims for wages or
other benefits, bonuses, accrued vacation, workers’ compensation, severance,
retention, termination or other payments or benefits, except liabilities and
obligations as are specifically included in the Working Capital or for which
Buyer is expressly responsible pursuant to Section 7.10(c).
 
Section 2.6.          Consents to Assignment. Notwithstanding anything else
contained herein, if any consent has not been obtained with respect to the
assignment to Buyer of a

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Purchased Business Agreement for which consent is required or which contains a
prohibition against assignment as of the Effective Date, or if an attempted
assignment of any such Purchased Business Agreement would be ineffective, (a)
Seller shall, as soon as reasonably practicable after becoming aware of either
circumstance through receipt of notice thereof or otherwise, advise Buyer
thereof and (b) after the Effective Date, Seller shall cooperate with Buyer to
implement reasonable arrangements (taking into account Seller’s remaining assets
and personnel following the Closing), to the extent reasonably practicable and
permissible under such Purchased Business Agreement, so that Buyer will receive
the benefits and be responsible for the obligations under such Purchased
Business Agreement, at the sole cost and expense of Buyer.

ARTICLE III 
 
PURCHASE PRICE
 
Section 3.1.          Purchase Price. As consideration for the sale, assignment,
transfer, conveyance and delivery of the Purchased Assets pursuant to this
Agreement:
 
(a)                on the Effective Date, Buyer agrees to pay (or cause to be
paid) to Seller (or to one or more Affiliates of Seller), in cash, amounts equal
to (i) one billion six hundred and ninety million dollars ($1,690,000,000) (the
“Base Purchase Price”) plus (ii) the Estimated Closing Working Capital ((i) and
(ii), collectively, the “Effective Date Payment”), pursuant to Section 4.2;
 
(b)               on the Effective Date, Buyer agrees to assume the Assumed
Obligations; and
 
(c)                after the Effective Date, Buyer and Seller agree to make the
adjustments and payments described in Section 3.2, as applicable.
 
Section 3.2.          Working Capital Adjustment.
 
(a)                Not less than five (5) Business Days prior to the anticipated
Effective Date, Seller shall deliver to Buyer a statement setting forth in
reasonable detail the Estimated Closing Working Capital (the “Estimated Closing
Statement”). The Estimated Closing Statement shall be prepared by Seller in
accordance with GAAP as modified by the methods, principles and categories that
were used to prepare the sample calculation of the Working Capital as of June
30, 2017 as set forth on Schedule 1.1(g) (the “Principles”); provided, that, in
the event of a conflict between GAAP and the Principles, the Principles shall
prevail; provided, however, that all amounts included in the Estimated Closing
Statement shall reflect Seller’s good faith and reasonable estimates as of the
point in time reflected therein based on all information then available to
Seller.
 
(b)               Within sixty (60) days after the Effective Date, Buyer shall
prepare and deliver to Seller a statement (the “Closing Statement”), setting
forth the Working Capital as of the close of business on the last Business Day
prior to the Effective Date (the “Closing Working Capital”) calculated in
accordance with the Principles.

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(c)                During the thirty (30) day period following Seller’s receipt
of the Closing Statement, Seller shall be permitted to review the working papers
of Buyer relating to the Closing Statement. The Closing Statement shall become
final and binding upon the Parties on the 30th day following delivery thereof to
Seller, unless Seller gives written notice of its disagreement with the Closing
Statement (the “Notice of Disagreement”) to Buyer prior to such date. Any Notice
of Disagreement shall be signed by Seller and shall (i) specify in reasonable
detail the nature of any disagreement so asserted, (ii) only include
disagreements based on mathematical errors, or based on the Closing Working
Capital not being calculated in accordance with Section 3.2 or the Principles,
and (iii) specify what Seller reasonably believes is the correct amount of the
Closing Working Capital, including a reasonably detailed description of the
adjustments applied to the Closing Statement in calculating such amount. If the
Notice of Disagreement is received in a timely manner, then the Closing
Statement (as revised in accordance with this sentence), shall become final and
binding upon Buyer and Seller on the earlier of (i) the date Seller and Buyer
resolve in writing any differences they have with respect to the matters
specified in the Notice of Disagreement or (ii) the date any disputed matters
are finally resolved in writing by the Accounting Firm as provided below. During
the thirty (30) day period following the delivery of the Notice of Disagreement,
if any, (i) Buyer and Seller shall seek in good faith to resolve in writing any
differences that they may have with respect to the matters specified in the
Notice of Disagreement and (ii) Buyer shall have access to the working papers of
Seller prepared in connection with the Notice of Disagreement. At the end of
such thirty (30) day period, if Buyer and Seller have not resolved their
disagreement, Buyer and Seller shall submit to an independent accounting firm
(the “Accounting Firm”) for resolution any matters that remain in dispute and
which were properly included in the Notice of Disagreement together with a brief
written explanation of each Party’s position. The Accounting Firm shall be
independent and mutually agreeable to both Buyer and Seller. Buyer and Seller
shall jointly instruct the Accounting Firm that it (i) shall review only the
matters that were properly included in the Notice of Disagreement which remain
unresolved, (ii) shall make its determination in accordance with the
requirements of this Section 3.2, and (iii) shall render its decision within
twenty (20) days from the submission of such matters. Judgment may be entered
upon the determination of the Accounting Firm in any court having jurisdiction
over the Party against which such determination is to be enforced. The fees,
costs and expenses of the Accounting Firm incurred pursuant to this Section 3.2
shall be borne fifty percent (50%) by Seller and fifty percent (50%) by Buyer.
 
(d)               The fees, costs and expenses of Buyer incurred in connection
with its preparation of the Closing Statement, its review of any Notice of
Disagreement, and its preparation of any written brief submitted to the
Accounting Firm shall be borne by Buyer, and the fees, costs and expenses of
Seller incurred in connection with its preparation and review of the Closing
Statement, its preparation and certification of any Notice of Disagreement and
its preparation of any written brief submitted to the Accounting Firm shall be
borne by Seller.
 
(e)                If the Closing Working Capital exceeds the Estimated Closing
Working Capital, Buyer shall, or if the Estimated Closing Working Capital
exceeds the Closing Working Capital, Seller shall, within ten (10) Business Days
after the Closing Statement becomes final and binding on the Parties, make
payment by wire transfer of immediately available funds of the amount of such
difference, together with interest thereon at a rate equal to the rate of
interest from time to time announced publicly by Citibank, N.A., as its prime
rate, calculated on the basis

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of the actual number of days elapsed divided by three hundred sixty five (365),
from (and including) the Effective Date through (but not including) the date of
payment, to an account designated in writing by the other Party. The difference
between the Closing Working Capital and the Estimated Closing Working Capital
shall be allocated among the Purchased Assets in accordance with the Allocation
Schedule (set forth in Section 7.9(a) below).

(f)                The Closing Statement, either as accepted or deemed to have
been accepted by Seller or as adjusted and resolved in the manner herein
provided, shall fix the Closing Working Capital, and the payment to be made as
discussed in Section 3.2(e).
 
(g)               The scope of the disputes to be resolved by the Accounting
Firm shall be limited to whether there were mathematical errors in the Closing
Statement and whether the calculation of the Closing Working Capital was done in
accordance with this Agreement and the Principles, and the Accounting Firm is
not to make any other determination.
 
(h)               Following the Closing, neither Buyer nor Seller shall take any
action with respect to the accounting books and records of the Business on which
the Closing Statement is to be based that is intended to obstruct, prevent or
otherwise affect the results of the procedures set forth in this ‎Section 3.2
(including the amount of the Closing Working Capital or any other amount
included in the preparation of the Closing Statement). From and after the
Effective Date through the resolution of any adjustment contemplated by this
Section 3.2, each of Buyer and Seller shall (i) assist, and shall cause its
Affiliates to assist, the other Party, its Affiliates, accountants, advisors and
other representatives in its preparation of the Closing Statement and the
Estimated Closing Statement and (ii) afford to the other Party, its Affiliates,
accountants, advisors and other representatives, reasonable access during normal
business hours to the personnel, properties, books and records of the Business
to the extent relevant to the preparation of the Closing Statement or any
adjustment contemplated by this Section 3.2.
 
Section 3.3.          No Duplication. For the avoidance of doubt, calculations
of the items described in this Article III, including, without limitation, the
Estimated Closing Statement and the Closing Statement, shall be calculated
without duplication.
 
ARTICLE IV 
 
THE CLOSING
 
Section 4.1.          Time and Place of Closing. Upon the terms and subject to
the satisfaction of the conditions contained in Article VIII of this Agreement,
the closing of the purchase and sale of the Purchased Assets and assumption of
the Assumed Obligations (the “Closing”) shall take place at the offices of Baker
Botts LLP, 30 Rockefeller Plaza, New York, New York, 10112, at 10:00 a.m., New
York City time, on the third Business Day following the date on which the
conditions set forth in Article VIII (other than conditions to be satisfied by
deliveries at the Closing) have been satisfied or waived, or at such other place
or time as the Parties may agree. The date on which the Closing occurs is
referred to herein as the “Effective Date.” The purchase and sale of the
Purchased Assets and assumption of the Assumed Obligations will be effective as
of 12:01 a.m. New York City time on the Effective Date (the “Effective Time”).

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Section 4.2.          Closing Payment. At the Closing, Buyer will pay or cause
to be paid to Seller the Effective Date Payment, by wire transfer of immediately
available funds to one or more accounts provided to Buyer by Seller prior to the
Closing.
 
Section 4.3.          Seller’s Closing Deliveries. Subject to Section 7.7, at or
prior to the Closing, Seller will deliver an executed copy of the following to
Buyer:
 
(a)                the certificate contemplated by Section 8.2(c);
 
(b)                the Bill of Sale, duly executed by Seller;
 
(c)                subject to Section 7.7(b), one or more Assignments of
Easement and Assignments of Lease with respect to the Leases and Conveyed
Easements, duly executed by Seller;
 
(d)                subject to Section 7.7(b), copies of all consents, waivers or
approvals obtained by Seller, in form and substance reasonably acceptable to
Buyer, from third parties in connection with this Agreement and the transactions
contemplated hereby, as set forth on Schedule 4.3(d), including all the Seller
Required Regulatory Approvals;
 
(e)                one or more Deeds in recordable form conveying title to the
Owned Real Property to Buyer, duly executed by Seller;
 
(f)                 a certificate of non-foreign status duly executed by Seller
that satisfies the requirements of Treasury Regulations section 1.1445-2(b)(2);
 
(g)                an assignment of the Assigned IP in a form reasonably
acceptable to Buyer, executed by Seller; and
 
(h)                such other agreements, documents, instruments, and writings
as are required to be delivered by Seller at or prior to the Effective Date
pursuant to this Agreement.
 
Section 4.4.          Buyer’s Closing Deliveries. At or prior to the Closing,
Buyer will deliver an executed copy of the following to Seller:
 
(a)                the Effective Date Payment;
 
(b)                the certificate contemplated by Section 8.3(c);
 
(c)                the Bill of Sale, duly executed by Buyer;
 
(d)                subject to Section 7.7(b), one or more Assignments of
Easement and Assignments of Lease with respect to the Leases and Conveyed
Easements, duly executed by Buyer;
 
(e)                subject to Section 7.7(b), copies of all consents, waivers or
approvals obtained by Buyer, in form and substance reasonably acceptable to
Seller, from third parties in connection with this Agreement and the
transactions contemplated hereby, as set forth on

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Schedule 4.4(e), including the Buyer Required Regulatory Approvals, and as
otherwise reasonably requested by Seller;

(f)                 one or more Deeds in recordable form conveying title to the
Owned Real Property to Buyer, duly executed by Buyer;
 
(g)                an assignment of the Assigned IP in a form reasonably
acceptable to Seller, executed by Buyer; and
 
(h)                such other agreements, documents, instruments and writings as
are required to be delivered by Buyer at or prior to the Effective Date pursuant
to this Agreement.
 
ARTICLE V 
 
REPRESENTATIONS AND WARRANTIES OF SELLER
 
Except as set forth in the Seller Disclosure Schedules, Seller hereby represents
and warrants to Buyer as follows:
 
Section 5.1.          Organization and Good Standing. Seller is a corporation
duly organized, validly existing, and in good standing under the laws of the
State of New Jersey and has all requisite corporate power and authority to own,
lease, and operate the Purchased Assets and to carry on the Business as
presently conducted. Seller is duly qualified or licensed to do business as a
foreign corporation and is in good standing in each jurisdiction in which the
conduct of the Business, or the ownership or operation of any Purchased Assets,
by Seller makes such qualification necessary, except, in each case, for any such
failures that would not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect.
 
Section 5.2.          Authority and Enforceability. Seller has all corporate
power and authority, and has taken all required action on its part, necessary to
execute and deliver, and to perform its obligations under, and, subject to the
satisfaction of the closing conditions, to consummate the transactions
contemplated by, this Agreement and the Ancillary Agreements. This Agreement has
been duly and validly executed and delivered by Seller, and (assuming the due
execution and delivery by Buyer) constitutes a valid and binding agreement of
Seller, enforceable against Seller in accordance with its terms, except as such
enforceability may be limited by applicable bankruptcy, insolvency, moratorium,
or other similar laws affecting or relating to enforcement of creditors’ rights
generally or general principles of equity. At the Closing, each of the Ancillary
Agreements to which Seller is contemplated to be a party will be duly and
validly executed and delivered by Seller and will (assuming the due execution
and delivery by each other Party thereto) constitute a valid and binding
agreement of Seller, enforceable against Seller in accordance with its terms,
except as such enforceability may be limited by applicable bankruptcy,
insolvency, moratorium, or other similar laws affecting or relating to
enforcement of creditors’ rights generally or general principles of equity.
 
Section 5.3.          No Conflicts; Consents. Except as set forth on Schedule
5.3, neither the execution, delivery and performance by Seller of this Agreement
or any Ancillary Agreement, nor the consummation of the transactions
contemplated hereby or thereby, will:

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(a)                violate or conflict with any of Seller’s Governing Documents
in any material respect;

(b)               assuming that all of the Buyer Required Regulatory Approvals
and Seller Required Regulatory Approvals have been made or obtained, and all
conditions therein which are then required to be satisfied have in fact been
satisfied, and any waiting periods thereunder have terminated or expired, as the
case may be, violate any Law or Order applicable to Seller or any of the
Purchased Assets, except, for any such violations that (i) would not reasonably
be expected to materially and adversely affect Buyer’s operation of the Business
or use of the Purchased Assets in the manner currently used or (ii) arise as a
result of any facts or circumstances relating particularly to Buyer or any of
its Affiliates;
 
(c)                violate, conflict with, result in a breach of, require any
consent or approval of, or (with or without notice or lapse of time or both)
constitute a default under or pursuant to any Purchased Business Agreement,
except, for any such violations, conflicts, breaches, consents, approvals,
defaults or other occurrences that (i) would not reasonably be expected to
materially and adversely affect Buyer’s operation of the Business or use of the
Purchased Assets in the manner currently used or (ii) arise as a result of any
facts or circumstances relating particularly to Buyer or any of its Affiliates;
or
 
(d)                other than the Seller Required Regulatory Approvals, require
any declaration, filing, or registration by Seller or any of its GAS Affiliates
with, or notice by Seller or any of its GAS Affiliates to, or authorization,
consent, or approval with respect to Seller or any of its GAS Affiliates of, any
Governmental Entity, except for any such declarations, filings, registrations,
notices, authorizations, consents, or approvals that (i) would not reasonably be
expected to materially and adversely affect Buyer’s operation of the Business or
use of the Purchased Assets in the manner currently used or (ii) arise as a
result of any facts or circumstances particular to Buyer or any of its
Affiliates.
 
Section 5.4.          Financial Information.
 
(a)                Schedule 5.4(a) sets forth the following financial statements
(the “Financial Statements”) relating to the Business: (A) an audited balance
sheet of the Business as at December 31, 2016, December 31, 2015 and December
31, 2014, (B) an audited income statement for the fiscal years ended December
31, 2016, December 31, 2015 and December 31, 2014 and (C) the unaudited balance
sheet of the Business as at June 30, 2017 (the “Balance Sheet”) and the related
statements of results of operations. Each of the Financial Statements have been
prepared in accordance with GAAP, subject, in the case of the interim financial
statements, to normal and recurring year-end adjustments and the absence of
notes, and fairly present, in all material respects, the financial condition and
results of operation of the Business as of the dates thereof or for the periods
covered thereby.
 
(b)                Except as set forth on Schedule 5.4(a), neither Seller nor
any of its Affiliates has any liability, absolute or contingent, related to the
Purchased Assets or the Business of any nature, whether or not required by GAAP
to be reflected in a balance sheet relating primarily to the Business, other
than liabilities, obligations or contingencies (i) that are accrued or reserved
against in the Financial Statements or (ii) that were incurred in the ordinary

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course of business consistent with past practice since June 30, 2017 that are
not, individually or in the aggregate, a Material Adverse Effect.

Section 5.5.          Absence of Certain Changes. Except as set forth in
Schedule 5.5, since June 30, 2017 to the date of this Agreement, the Business
has been operated, in all material respects, in the ordinary course of business
consistent with past practice of the Business, and no change or event has
occurred which, either individually or in the aggregate, has resulted, or with
the passage of time, would reasonably be expected to result in a Material
Adverse Effect.
 
Section 5.6.          Title. Upon consummation of the transactions contemplated
by this Agreement and receipt of all consents and approvals disclosed on
Schedule 5.3, Seller will have assigned, transferred and conveyed to Buyer good
and marketable title to, or a valid leasehold interest in, the material tangible
Purchased Assets, free and clear of all Encumbrances (other than Permitted
Encumbrances), except as would not reasonably be expected to materially and
adversely affect Buyer’s operation of the Business or use of the Purchased
Assets in the manner currently used.
 
Section 5.7.          Material Contracts.
 
(a)                Schedule 5.7(a) lists all of the following Purchased Business
Agreements (the “Material Contracts”):
 
(i)                 each agreement, ordinance, or other grant of any municipal,
town or county franchise relating to the Business (the “Franchises”), except for
such Franchises, the absence of which would not, individually or in the
aggregate, have a Material Adverse Effect;
 
(ii)                 all agreements between Seller and one or more (A) Business
Employees or (B) independent non-Affiliate third party consultants or
contractors individually involving expenditures in excess of $3,000,000 in any
one year;
 
(iii)               all leases, subleases, licenses or other agreements (which,
for the avoidance of doubt, shall not include Easements) by which any right to
use or occupy any interest in real property is granted by or to Seller, except
for such leases, subleases, licenses or other agreements, the existence or
absence of which would not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect and that do not individually involve
expenditures in excess of $3,000,000 in any one (1) year (excluding sales orders
and purchase orders issued in the ordinary course of business);
 
(iv)               all other agreements that individually involve expenditures
in excess of $3,000,000 in any one (1) year;
 
(v)                all agreements providing for the extension of credit by
Seller, other than (A) the extension of credit to customers in the ordinary
course of business consistent with past practice, and (B) normal employee
advances and other customary extensions of credit in the ordinary course that
are not material in amount;

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(vi)               all agreements for, or relating to, indebtedness, or pursuant
to which any Encumbrance is granted in or to any of the Purchased Assets;
 
(vii)              all agreements granting to any Person any right or option to
purchase or otherwise acquire any of the Purchased Assets, including rights of
first option, rights of first refusal, or other preferential purchase rights;
 
(viii)             all agreements that, upon consummation of the transactions
contemplated hereby, would limit the ability of Buyer to compete in any line of
business or with any Person or in any geographic area or during any period of
time; and
 
(ix)                all partnership, joint venture and joint ownership
agreements, and all similar material agreements (however named) relating to the
Business, Purchased Assets or Assumed Obligations involving a sharing of assets,
profits, losses, costs or liabilities.
 
(b)               To the Knowledge of Seller, each Material Contract is valid
and binding in accordance with its terms and is in full force and effect. Seller
has made available to Buyer copies of each Material Contract together with all
amendments, waivers, or other changes thereto, which are correct and complete in
all material respects. Except as set forth on Schedule 5.7(b), neither Seller
or, to the Knowledge of Seller, any other party to a Material Contract: (A) is
in default under or in breach of any Material Contract in any material respect
or (B) has repudiated or is challenging any material provision of any Material
Contract.
 
Section 5.8.          Legal Proceedings. Except as set forth on Schedule 5.8,
there are no existing or, to Seller’s Knowledge, threatened in writing, material
Claims relating to the Business, the Purchased Assets, or the Assumed
Obligations or the transactions contemplated by this Agreement.
 
Section 5.9.          Compliance with Law; Orders; Permits.
 
(a)                Except as set forth on Schedule 5.9(a), Seller is, and at all
times since January 1, 2015 has been, in compliance with all Laws, Orders and
Permits applicable to the Purchased Assets or the Business, except for
violations which would not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect.
 
(b)               Except as set forth on Schedule 5.9(b), Seller possesses all
Permits necessary to own and operate the Business and Purchased Assets as
currently operated, all of such Permits are in full force and effect, and no
appeal or other proceeding is pending or, to Seller’s Knowledge, threatened in
writing to revoke any such Permits, except where the failure to have such Permit
or for such Permit to be in effect would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.
 
Section 5.10.        Real Property.
 
(a)                Schedule 2.2(a)(i) sets forth a true and correct legal
description of all Owned Real Property and Leased Real Property.

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(b)                Seller has on the date of this Agreement (and immediately
prior to the Effective Time will have) good and marketable fee simple title to
the Owned Real Property and all improvements thereon and good and valid
leasehold interests in the Leased Real Property and all improvements thereon (to
the extent leased by Seller), free and clear of all Encumbrances except
Permitted Encumbrances and except as would not reasonably be expected to
materially and adversely affect Buyer’s operation of the Business or use of the
Purchased Assets in the manner currently used. Except as otherwise provided in
Schedule ‎2.2(a)(i), none of the Owned Real Property is leased or licensed for
use by a third party. On the date of this Agreement Seller is (and immediately
prior to the Effective Time, Seller will be) the owner of the material Conveyed
Easements. To the Knowledge of Seller, the Conveyed Easements, together with the
Owned Real Property, the Leased Real Property and all other Easements
appurtenant to the Owned Real Property, constitute materially all interests in
real property that are currently required for the operation of the Business. To
the Knowledge of Seller, there are no unrecorded outstanding options, rights of
first offer or rights of first refusal to purchase the Owned Real Property, the
Conveyed Easements, or any portion thereof or interest therein.
 
(c)                All of the Leases are in full force and effect and (i) Seller
is not in default (and has not taken or failed to take any action which with
notice, the passage of time, or both, would constitute a default) under the
terms of any Lease and, to the Knowledge of Seller, Seller has not received
written notice of material default under any Lease which has not been cured
within the applicable grace periods and (ii) to the Knowledge of Seller, no
landlord is in material default under any Lease.
 
(d)                There is no pending condemnation, eminent domain or similar
proceeding affecting the Owned Real Property or the Leased Real Property or any
portion thereof, and, to the Seller’s Knowledge, Seller has not received any
written notice that any such proceeding is contemplated. To the Knowledge of
Seller, there is no pending condemnation or similar proceeding affecting any
Conveyed Easement (or any portion thereof) and Seller has not received any
written notice that any such proceeding is contemplated.
 
(e)                To the Knowledge of Seller, Seller has not received any
written notice of existing, pending or threatened zoning, building code or other
moratorium proceedings, or similar matters which would adversely affect the
ability of Buyer to operate the Business as currently conducted in any material
respect. As of the date hereof, neither the whole nor any material portion of
the Real Property has been damaged or destroyed by fire or other casualty.
 
Section 5.11.        Environmental Matters. Except as set forth in Schedule 5.11
and except as would not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect:
 
(a)                To the Seller’s Knowledge, all Environmental Permits that are
necessary for the operation of the Business as it is currently being operated
have been obtained and are in full force and effect, and to the Seller’s
Knowledge, the Purchased Assets, the Business, and Seller (with respect to the
Purchased Assets and Business) are currently in compliance with the requirements
of all Environmental Laws.

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(b)                Except as set forth on Schedule 5.11(b), neither Seller nor
any Affiliate of Seller has, since January 1, 2015, nor to the Seller’s
Knowledge for any period prior to January 1, 2015, entered into or been subject
to any consent decree, agreement, or Order with any Governmental Entity, or
received any written notice or report regarding any actual or alleged violation
of Environmental Laws or any liabilities or potential liabilities that has not
been resolved, including any investigatory, remedial, or corrective obligations,
arising under Environmental Laws, in each case relating to the ownership or
operation of the Business or the Purchased Assets.
 
(c)                To the Seller’s Knowledge, during Seller’s ownership,
possession or operation of the Real Property, there is and has been no Release
from, in, on, or beneath any of the Real Property that could form a basis for an
Environmental Claim.
 
(d)                There are no Environmental Claims pending or, to the Seller’s
Knowledge, threatened that relate to the Purchased Assets or the Business.
 
Notwithstanding anything else contained herein, the representations and
warranties contained in this Section 5.11 are the only representations and
warranties being made with respect to compliance with or liability under
Environmental Laws, Environmental Permits, Hazardous Materials or with respect
to Environmental Claims or any environmental, health or safety matter related to
the Business, the Purchased Assets or Seller’s ownership or operation thereof.
 
Section 5.12.        Taxes. Except as set forth on Schedule 5.12:
 
(a)                All material Tax Returns required to be filed by Seller or
any Affiliate of Seller with respect to the Business or the Purchased Assets
have been filed in a timely manner. Each such Tax Return is correct and complete
in all material respects. All Taxes shown as due and payable on such Tax Returns
have been paid in full.
 
(b)                No material claim, audit, action, suit, proceeding,
investigation or other examination with respect to Taxes (each, a “Tax Contest”)
is pending or, to the Seller’s Knowledge, threatened with respect to the
Business or Purchased Assets.
 
(c)                Neither Seller nor any Affiliate of Seller has granted any
waiver of any statute of limitations regarding, or any extension of any period
for the assessment of, any material amount of Tax relating to the Business or
the Purchased Assets.
 
(d)                Other than Permitted Encumbrances, there are no liens upon
the Business or any of the Purchased Assets with respect to any material amount
of Taxes.
 
(e)                Seller has collected all material amounts of Taxes that it
has been required by Law to collect from customers and employees of the
Business.
 
(f)                 Buyer will not, as a result of the transactions contemplated
by this Agreement, become a party to or assume liability under any tax sharing,
tax allocation, or similar agreement (excluding, for the avoidance of doubt,
this Agreement).

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(g)                Except for the express representations and warranties made by
Seller in this ‎Section 5.12 and Section 5.13, Seller makes no representation or
warranty, express or implied, with respect to Taxes or Tax matters.
 
Section 5.13.        Employee Benefits.
 
(a)                Schedule 5.13(a) lists each employee benefit plan (as such
term is defined in section 3(3) of ERISA) and each other plan, program, policy,
contract, agreement or arrangement providing compensation or benefits to any
Business Employee that is maintained by, contributed to, sponsored by or
required to be contributed to by Seller or any of its ERISA Affiliates as of the
date hereof (each, a “Benefit Plan”).
 
(b)                With respect to each Benefit Plan, Seller has made available
to Buyer copies of each of the following documents: (i) each Benefit Plan
(including all amendments thereto); (ii) the most recent summary plan
description, together with each summary of material modifications, if required
under ERISA, with respect to such Benefit Plan; (iii) the most recent annual
report (Form 5500, including schedules and attachments) filed with the United
States Internal Revenue Service or Department of Labor, if required under ERISA;
and (iv) the most recent determination letter received from the United States
Internal Revenue Service with respect to each Benefit Plan that is intended to
be qualified under section 401(a) of the Code.
 
(c)                 Each Benefit Plan that is intended to be qualified under
section 401(a) of the Code has received, from the Internal Revenue Service, a
favorable determination letter (or in the case of a master or prototype plan, a
favorable opinion letter or in the case of a volume submitter plan, a favorable
advisory letter) as to its qualification under Section 401(a) of the Code, and
nothing has occurred that would be reasonably expected to adversely affect the
qualified or exempt status of such Benefit Plan or trust, nor will the
consummation of the transactions provided for by this Agreement have any such
effect.
 
(d)                Each Benefit Plan is being, and has been, operated and
administered in all material respects in accordance with ERISA, the Code and all
other applicable Laws and regulations thereunder and in accordance with its
terms, except to the extent a failure to so operate or administer a Benefit Plan
would not result in Buyer or any of its Affiliates having any liability.
 
(e)                Schedule 5.13(e) sets forth a list of collective bargaining
agreements, as well as any side agreements, amendments or memoranda relating to
the Transferred Employees (the “Labor Agreement”).
 
Section 5.14.        Employment Matters.
 
(a)                As of the Effective Date, all compensation, including wages,
commissions and bonuses payable to employees, independent contractors or
consultants of the Business for services performed on or prior to the Effective
Date will have been paid in full or will be paid in full when due.

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(b)                Seller has complied with the WARN Act, to the extent
applicable, except to the extent such failure to comply would not result in
Buyer or any of its Affiliates having any liability.
 
Section 5.15.       No Undisclosed Liabilities. Seller does not have any
liabilities or obligations with respect to the Business that would be required
to be reflected on a balance sheet prepared in accordance with GAAP consistently
applied, except those (a) which are adequately reflected or reserved against in
the Financial Statements (or disclosed in any notes thereto), (b) which have
been incurred in the ordinary course of business consistent with past practice
since June 30, 2017, (c) that have not been and would not reasonably be expected
to be, individually or in the aggregate, material to the Business and (d)
consisting of future performance or payment obligations (other than relating to
a breach or default) under the Purchased Business Agreements.
 
Section 5.16.        Brokers and Finders. No broker, finder, or other Person is
entitled to any brokerage fees, commissions, or finder’s fees for which Buyer or
the Business could become liable or obligated in connection with the
transactions contemplated hereby by reason of any action taken by Seller or any
of its Affiliates.
 
Section 5.17.        Exclusivity of Representations and Warranties. None of
Seller, any of its Affiliates or any of Seller’s Representatives is making any
representation or warranty of any kind or nature whatsoever, oral or written,
express or implied (including, but not limited to, any relating to (a)
projections, estimates or budgets delivered or made available to Buyer (or any
of its Affiliates, officers, directors, employees or representatives) of the
results of operations (or any component thereof), cash flows or financial
condition (or any component thereof), of the Business; (b) future business,
operations, revenues or profits of the Business; and (c) maintenance, repair,
condition, design, performance, value, merchantability or fitness for any
particular purpose of the Purchased Assets), except for those representations
and warranties expressly set forth in this Article V (as qualified by the Seller
Disclosure Schedules), and Seller hereby disclaims any such other
representations or warranties. Subject to the terms of this Agreement and the
representations and warranties of Seller contained in this ‎Article V, the
Purchased Assets, the Business and the Assumed Obligations are being acquired
and assumed by Buyer on an “as is, where is” basis and in their present
condition, and Buyer shall rely solely upon its own examination thereof and the
representations and warranties set forth in this ‎Article V. None of Seller, any
of its Affiliates or any of Seller’s Representatives shall have any liability or
responsibility based upon any information provided or made available or
statements made or omissions therefrom to Buyer, its Affiliates or their
respective Representatives, except as and only to the extent expressly set forth
in this Agreement (as qualified by the Seller Disclosure Schedules).
 
ARTICLE VI 
 
REPRESENTATIONS AND WARRANTIES OF BUYER
 
Buyer hereby represents and warrants to Seller:
 
Section 6.1.          Organization and Good Standing. Buyer is a corporation
duly organized, validly existing, and in good standing under the laws of the
State of New Jersey and

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has all requisite corporate power and authority to own its assets and to carry
on its business as presently conducted. As of the Closing, Buyer will be duly
qualified or licensed to do business as a foreign corporation and is in good
standing in each jurisdiction in which the conduct of the Business, or the
ownership or operation of any of the Purchased Assets, by Buyer makes such
qualification necessary, except, in each case, for any such failures that would
not, individually or in the aggregate, reasonably be expected to have a material
adverse effect on the ability of Buyer to perform its obligations under this
Agreement or consummate the transactions contemplated hereby on a timely basis.

Section 6.2.          Authority and Enforceability. Buyer has all corporate
power and authority, and has taken all required corporate action on its part,
necessary to execute and deliver, and to perform its obligations under, and,
subject to the satisfaction of the closing conditions, to consummate the
transactions contemplated by, this Agreement and the Ancillary Agreements. This
Agreement has been duly and validly executed and delivered by Buyer, and
(assuming the due execution and delivery by Seller) constitutes a valid and
binding agreement of Buyer, enforceable against Buyer in accordance with its
terms, except as such enforceability may be limited by applicable bankruptcy,
insolvency, moratorium, or other similar laws affecting or relating to
enforcement of creditors’ rights generally or general principles of equity. At
the Closing, the Ancillary Agreements to which Buyer is contemplated to be a
party will be duly and validly executed and delivered by Buyer and will
(assuming the due execution and delivery by each other Party thereto) constitute
a valid and binding agreement of Buyer, enforceable against Buyer in accordance
with its terms, except as such enforceability may be limited by applicable
bankruptcy, insolvency, moratorium, or other similar laws affecting or relating
to enforcement of creditors’ rights generally or general principles of equity.
 
Section 6.3.          No Conflicts; Consents. Neither the execution, delivery
and performance by Buyer of this Agreement or any Ancillary Agreement, nor the
consummation of the transactions contemplated hereby or thereby, will:
 
(a)                (i) violate or conflict with any of Buyer’s Governing
Documents; (ii) assuming that all of the Buyer Required Regulatory Approvals and
Seller Required Regulatory Approvals have been made or obtained, and all
conditions therein which are then required to be satisfied have in fact been
satisfied, and any waiting periods thereunder have terminated or expired, as the
case may be, violate any Law or Order applicable to Buyer, or (iii) violate,
conflict with, result in a breach of, require any consent or approval of, or
(with or without notice or lapse of time or both) constitute a default under or
pursuant to, any contract to which Buyer is a party, except, in the case of
clauses (ii) and (iii), for any such violations, conflicts, breaches, consents,
approvals, defaults or other occurrences (A) that would not reasonably be
expected to have a material adverse effect on the ability of Buyer to perform
its obligations under this Agreement or consummate the transactions contemplated
hereby on a timely basis or (B) that arise as a result of any facts or
circumstances relating to Seller or its Affiliates; or
 
(b)               other than the Buyer Required Regulatory Approvals, require
any declaration, filing, or registration by Buyer or any of its Affiliates with,
or notice by Buyer or any of its Affiliates to, or authorization, consent, or
approval with respect to Buyer or any of its Affiliates of, any Governmental
Entity, except for any such declarations, filings, registrations, notices,
authorizations, consents, or approvals (i) the failure of which to obtain or
make would

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not reasonably be expected to have a material adverse effect on the ability of
Buyer to perform its obligations under this Agreement or consummate the
transactions contemplated hereby on a timely basis or (ii) that arise as a
result of any facts or circumstances relating to Seller or its Affiliates
unrelated to the Business, the Purchased Assets or the Assumed Obligations.

Section 6.4.          Financial Capability. Buyer (a) has or will have at the
Closing sufficient funds available to pay the Purchase Price and any fees, costs
and expenses incurred by Buyer in connection with the transactions contemplated
by this Agreement and the Ancillary Agreements, (b) has, or at the Closing will
have, the resources and capabilities (financial or otherwise) to perform its
other obligations hereunder and under each Ancillary Agreement; and (c) has not
incurred, and prior to the Closing will not incur, any obligation, commitment,
restriction, or liability of any kind, which would impair or adversely affect
such resources and capabilities. Notwithstanding anything to the contrary
contained herein, the Parties acknowledge and agree that it shall not be a
condition to the obligations of Buyer to consummate the transactions
contemplated hereby that Buyer have sufficient funds for payment of the Purchase
Price.
 
Section 6.5.          Brokers and Finders. No broker, finder, or other Person is
entitled to any brokerage fees, commissions, or finder’s fees for which Seller
or its Affiliate could become liable or obligated in connection with the
transactions contemplated hereby by reason of any action taken by Buyer or any
of its Affiliates.
 
Section 6.6.          Legal Proceedings. There are no pending or, to Buyer’s
knowledge, threatened, Claims that would, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect on the ability of Buyer
to perform its obligations under this Agreement or any Ancillary Agreement or
consummate the transactions contemplated hereby or thereby on a timely basis.
 
Section 6.7.          Investigation by Buyer. Buyer has undertaken an
independent review and analysis of the business, operations, assets,
liabilities, results of operations, financial condition and prospects of the
Business and has performed all due diligence that it has deemed necessary to
perform concerning the Business, the Purchased Assets, and the Assumed
Obligations in connection with its decision to enter into this Agreement and the
Ancillary Agreements and to consummate the transactions contemplated hereby and
thereby and acknowledges that Buyer and Buyer’s Representatives have been
provided access to the personnel, properties, premises and records of Seller for
such purpose. In entering into this Agreement, Buyer has relied solely upon its
own investigation and analysis, and Buyer:
 
(a)                acknowledges that none of Seller or any of its Affiliates or
any of Seller’s Representatives makes or has made any representation or
warranty, of any kind or nature whatsoever, oral or written, express or implied
(including, but not limited to, any relating to (a) projections, estimates or
budgets delivered or made available to Buyer (or any of its Affiliates,
officers, directors, employees or representatives) of, except as set forth in
Section 5.4, the future results of operations (or any component thereof), cash
flows or financial condition (or any component thereof), of the Business; (b)
future business, operations, revenues or profits of the Business; (c)
maintenance, repair, condition, design, performance, value, merchantability or
fitness for any particular purpose of the Purchased Assets; or (d) as to the
accuracy or

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completeness of any of the information provided or made available to Buyer or
Buyer’s Representatives), except for those representations and warranties
expressly set forth in Article V of ‎this Agreement (as qualified by the Seller
Disclosure Schedules), and Seller hereby disclaims any such other
representations or warranties;

(b)               agrees, to the fullest extent permitted by applicable Law,
that none of Seller or any of its Affiliates or any of Seller’s Representatives
shall have any liability or responsibility whatsoever to Buyer on any basis
based upon any information provided or made available, or statements made, to
Buyer or Buyer’s Representatives (including any forecasts or projected
information), except that the foregoing limitations shall not apply with respect
to Seller to the extent Seller has liability for indemnification pursuant to
‎Article IX for the breach of the specific representations and warranties set
forth in ‎Article V of this Agreement (as qualified by the Seller Disclosure
Schedules), but always subject to the limitations and restrictions contained
herein;
 
(c)                acknowledges that, except as expressly set forth in this
Agreement, there are no representations or warranties of any kind, express or
implied, with respect to the Business, the Purchased Assets or the Assumed
Obligations; and
 
(d)               none of Seller, its Affiliates or Seller’s Representatives
shall have any liability or responsibility based upon any information provided
or made available or statements made or omissions therefrom to Buyer, its
Affiliates or their respective Representatives, except as and only to the extent
expressly set forth in ‎Article V of this Agreement (as qualified by the Seller
Disclosure Schedules).
 
ARTICLE VII 
 
COVENANTS OF THE PARTIES
 
Section 7.1.          Conduct of the Business.
 
Except (a) as expressly contemplated in this Agreement or required by applicable
Law or Order; (b) for actions approved by Buyer in writing (which approval shall
not be unreasonably withheld, conditioned or delayed); (c) in connection with
necessary repairs due to breakdown or casualty, or other actions taken in
response to a business emergency or other unforeseen operational matters; or (d)
as otherwise described in Schedule 7.1 or set forth in the 2017 and 2018 budget
with respect to the Business attached hereto as Schedule 7.1(d) (the “2017/2018
Budget”), during the period from the date of this Agreement to the Effective
Time, Seller will, and will cause its Affiliates to, (1) operate the Business in
the ordinary course consistent with past practice, (2) use commercially
reasonable efforts to preserve intact the Business, and to preserve the goodwill
and relationships with customers, suppliers, and others having business dealings
with the Business and (3) not, without the prior written consent of Buyer:
 
(i)                 sell, lease (as lessor), transfer, or otherwise dispose of
any of the Purchased Assets, other than (A) the use or sale of inventory in the
ordinary course of business, or (B) the disposal of Purchased Assets having an
aggregate value of less than $3,000,000 or that are no longer useful in the
business;

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(ii)                 make any material change in the levels of Inventory
customarily maintained by Seller with respect to the Business;
 
(iii)                assign, relinquish any material rights under, or amend in
any material respect any of the Material Contracts;
 
(iv)               increase the base pay or aggregate benefits provided to any
Business Employees, except for increases in base pay and aggregate benefits in
the ordinary course of business and consistent with past practice;
 
(v)                fail to make capital expenditures in connection with the
Business equal to or greater than 85% of the amounts specified in the 2017/2018
Budget during the time periods specified in the 2017/2018 Budget;
 
(vi)               incur, assume or guarantee, modify or amend any indebtedness
for borrowed money in connection with the Business, except for (A) unsecured
current obligations in the ordinary course of business, (B) liabilities
(including participation in the utility money pool) incurred in the ordinary
course of business consistent with past practice, (C) remarketing of the
Tax-Exempt Bonds and (D) any action with respect to any indebtedness that will
not be transferred to Buyer;
 
(vii)              sell products or services to customers on any basis other
than the tariff on file with the NJBPU or contracts approved by the NJBPU other
than products or services not related to the Business or the Purchased Assets;
or
 
(viii)             agree or commit to take any action which would be a violation
of the restrictions set forth in this Section 7.1.
 
Section 7.2.          Access.
 
(a)                To the extent permitted by applicable Law, between the date
of this Agreement and the Effective Date, Seller will, during ordinary business
hours and upon reasonable notice: (i) give Buyer and Buyer’s Representatives
reasonable access to the Purchased Assets; and (ii) permit Buyer and Buyer’s
Representatives to make such reasonable inspections thereof as Buyer may
reasonably request; provided, however, that (i) any such inspection will be
conducted in such a manner as not to materially interfere with the operation of
the Business or any other Person; (ii) Seller shall not be required to take any
action which would constitute or result in a waiver of the attorney-client
privilege or violate any of its contracts or agreements; and (iii) Seller shall
not be required to supply Buyer with any information which Seller is under a
legal obligation not to supply. Buyer shall indemnify and hold harmless Seller
from and against any Losses incurred by Seller, its Affiliates or their
Representatives by any action of Buyer or Buyer’s representatives while present
on any of the Purchased Assets or other premises to which Buyer is granted
access hereunder (including restoring any such premises to the condition
substantially equivalent to the condition such premises were in prior to any
such investigation). Notwithstanding anything in this Section 7.2 to the
contrary, (i) Buyer will not have access to personnel records if such access
could, in Seller’s good faith judgment, subject Seller to risk of liability or
otherwise violate applicable Law, including the Health Insurance Portability and
Accountability Act of 1996 and (ii) any inspection relating to environmental
matters by or on

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behalf of Buyer will be strictly limited to visual inspections and site visits
commonly included in the scope of “Phase 1” level environmental inspections, and
Buyer shall not have any right to perform or conduct any other investigation or
inspection, including sampling or testing at, in, on, around or underneath any
of the Purchased Assets.

(b)               For a period of seven (7) years after the Effective Date, each
Party and its representatives will have reasonable access to all of the books
and records relating to the Business or the Purchased Assets in the possession
of the other Party, and to the employees of the other Party, to the extent that
such access may reasonably be required by such Party in connection with the
Assumed Obligations or the Excluded Liabilities, or other matters relating to or
affected by the operation of the Business and the Purchased Assets. Such access
will be afforded by the applicable Party upon receipt of reasonable advance
notice and during normal business hours, and will be conducted in such a manner
as not to interfere with the operation of the business of any Party or its
respective Affiliates. The Party exercising the right of access hereunder will
be solely responsible for any costs or expenses incurred by either Party in
connection therewith. Each Party shall retain such books and records for a
period of seven (7) years from the Effective Date.
 
Section 7.3.          Confidentiality by Buyer to Seller.
 
(a)                For a period of two (2) years following the Closing or the
termination of this Agreement, Buyer will, and will cause its Affiliates and
Buyer’s Representatives to, hold all Confidential Information in strict
confidence and not disclose any Confidential Information to any Person other
than its Affiliates and Buyer’s Representatives; provided, however, that upon
the Closing, the provisions of this Section 7.3 will expire with respect to any
information to the extent primarily related to the Purchased Assets or the
Business (“Business Confidential Information”). “Confidential Information” means
all information in any form heretofore or hereafter obtained from Seller or any
of Seller’s Representatives or Affiliates in connection with Buyer’s evaluation
of the Business, the Assumed Obligations or the Purchased Assets or the
negotiation of this Agreement or any Ancillary Agreement, whether pertaining to
financial condition, results of operations, methods of operation or otherwise,
other than information which is in the public domain through no violation of
this Agreement or the Confidentiality Agreement by Buyer, its Affiliates, or
Buyer’s Representatives.
 
(b)               Notwithstanding the foregoing, Buyer may disclose Confidential
Information to the extent that such information is required to be disclosed by
Buyer by Law or in connection with any proceeding by or before a Governmental
Entity, including any disclosure, financial or otherwise, required to comply
with the rules of any securities commission or exchange. In the event that Buyer
believes any such disclosure is required, Buyer will give Seller notice thereof
as promptly as possible and, at Seller’s expense, will cooperate with Seller in
seeking any protective orders or other relief as Seller may reasonably request.
 
(c)                If the transactions contemplated hereby are not consummated,
Buyer will promptly return to Seller or destroy all copies of any Confidential
Information in accordance with the terms of, and as required by, the
Confidentiality Agreement.

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(d)               If the transactions contemplated hereby are consummated, to
the extent Confidential Information is Business Confidential Information, and
only to such extent, the Confidentiality Agreement is hereby expressly
superseded by this Section 7.3.
 
Section 7.4.          Confidentiality by Seller to Buyer. For a period of two
(2) years following the Closing, Seller shall, and shall use its commercially
reasonable efforts to cause its Affiliates and Representatives and the
Representatives of its respective Affiliates to hold, in confidence any and all
Business Confidential Information, except to the extent that such information:
(a) is or becomes generally available to the public other than as a result of a
disclosure by Seller in violation of the terms of this Section 7.4; (b) was
lawfully acquired by Seller, any of its Affiliates or their respective
Representatives from and after the Closing from sources not known to be
prohibited from disclosing such information to such Person by an obligation of
confidentiality to Buyer or (c) is developed independently by Seller, any of its
Affiliates or any of their respective Representatives without the use of
Business Confidential Information. Notwithstanding the foregoing, Seller may
disclose Confidential Information to the extent that such information is
required to be disclosed by Seller by Law or in connection with any proceeding
by or before a Governmental Entity, including any disclosure, financial or
otherwise, required to comply with the rules of any securities commission or
exchange. In the event that Seller believes any such disclosure is required,
Seller will give Buyer notice thereof as promptly as possible and, at Buyer’s
expense, will cooperate with Buyer in seeking any protective orders or other
relief as Buyer may reasonably request.
 
Section 7.5.          Transition Services. For a period not to exceed twelve
(12) months following the Closing, Seller shall, or shall cause its Affiliates
to, provide to Buyer and its Affiliates such of the services currently provided
by Seller or its Affiliates to the Business as Buyer may request, which services
are to be provided in substantially the same manner and at the same level as
such services are presently provided by Seller or its Affiliates, and Buyer and
its Affiliates shall reimburse Seller and its Affiliates for such services at
the fully-loaded costs as specified on Schedule 7.5.
 
Section 7.6.          Expenses. Except for Transfer Taxes as provided in Section
7.9(h) below, Buyer shall bear sole responsibility for payment of all filing,
recording, transfer, or other fees or charges of any nature in connection any
Required Regulatory Approvals or otherwise payable pursuant to any provision of
any Law, Order or Franchise in connection with the sale, transfer, and
assignment by Seller of the Purchased Assets and the Assumed Obligations to
Buyer. Except as provided in the foregoing or to the extent otherwise
specifically provided herein, and irrespective of whether the transactions
contemplated hereby are consummated, all other costs and expenses incurred in
connection with this Agreement and the transactions contemplated hereby will be
borne by the Party incurring such costs and expenses.
 
Section 7.7.          Further Assurances; Wrong Pockets.
 
(a)                Subject to the terms and conditions of this Agreement,
including Section 7.8, each of the Parties will use reasonable best efforts to
take, or cause to be taken, all action, and to do, or cause to be done, all
things necessary, proper, or advisable under applicable Law to consummate and
make effective the transactions contemplated hereby, including using

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reasonable best efforts to obtain satisfaction of the conditions precedent to
each Party’s obligations hereunder.

(b)               Notwithstanding anything in this Agreement or any Ancillary
Agreement to the contrary, this Agreement and the Ancillary Agreements shall not
constitute an agreement to transfer or assign any contract, agreement, permit,
claim or right or any benefit or obligation arising thereunder or resulting
therefrom if an attempted assignment thereof, without the consent of a third
party, would constitute a breach or other contravention under any agreement or
Law to which Seller or any of its Affiliates is a party or by which it is bound,
or in any way adversely affect the rights of Seller or any of its Affiliates or,
upon transfer, Buyer under such contract, agreement, permit, claim or right.
Seller will use its commercially reasonable efforts to obtain, promptly
following the date hereof, any and all consents of third parties required to
assign to Buyer Seller’s rights under the Purchased Business Agreements. Buyer
agrees to take reasonable actions to cooperate with Seller in Seller’s efforts
to obtain any consents of third parties required to assign to Buyer Seller’s
rights under the Purchased Business Agreements, including the submission of
reasonable, financial or other information concerning Buyer and the execution of
any assumption agreements or similar documents reasonably requested by a third
party provided that such agreements or documents are consistent with the terms
hereof. To the extent that, notwithstanding its commercially reasonable efforts,
Seller is unable to obtain any such required consent prior to the Closing, and
as a result thereof Buyer shall be prevented by such third party from receiving
the rights and benefits with respect to such Purchased Asset intended to be
transferred hereunder, or if any attempted assignment would adversely affect the
rights of Seller thereunder so that Buyer would not in fact receive all such
rights or Seller would forfeit or otherwise lose the benefit of rights that
Seller is entitled to retain, Seller and Buyer shall cooperate to resolve the
matter in accordance with Section 2.6. Without in any way limiting the
conditions to the Closing set forth in ‎Article VIII, Buyer agrees that other
than liability arising from a failure to comply with this ‎Section 7.7 and
Section 7.8 or a breach of Seller’s representations and warranties set forth in
‎Article V hereof, Seller shall not have any liability to Buyer arising out of
the failure to obtain any such consent that may be required in connection with
the transactions contemplated by this Agreement or the Ancillary Agreements or
because of any circumstances resulting therefrom.
 
(c)                To the extent that, notwithstanding its commercially
reasonable efforts, Seller is unable to meet ISRA property transfer requirements
prior to the Effective Date for any Real Property, such Real Property shall be
excluded from the Purchased Assets at Closing (“Holdback Property”) and leased
to the Buyer until ISRA property transfer requirements are satisfied. Seller and
Buyer shall cooperate in developing a lease for any Holdback Property to reflect
the rights, benefits, and obligations that would otherwise have applied as of
the Closing to the maximum extent feasible and shall close on the transfer of
the Holdback Property to Buyer as soon as commercially reasonable following
satisfaction of ISRA property transfer requirements.
 
(d)               Seller shall, and shall cause its Affiliates to, execute and
deliver such further instruments of conveyance and transfer and take such
additional action as Buyer may reasonably request to effect, consummate, confirm
or evidence the sale and transfer to Buyer of the Purchased Assets and the other
transactions contemplated by this Agreement. Buyer shall, and shall cause its
Affiliates to, execute and deliver such further instruments of assumption and

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take such additional action as Seller may reasonably request to effect,
consummate, confirm or evidence the transactions contemplated hereby.

(e)                Without limiting the generality of the foregoing, if at any
time following the Closing it becomes apparent that any Purchased Asset
(including any contract) that should have been transferred to Buyer pursuant to
this Agreement was not so transferred, or any Excluded Asset was inadvertently
transferred to Buyer, Seller shall, and shall cause its applicable Affiliates
to, or Buyer shall, and shall cause its Affiliates to, as applicable, in each
case as promptly as practicable, (i) transfer all rights, title and interest in
(A) such Purchased Asset to Buyer or as Buyer may direct, or (B) such Excluded
Asset to Seller or as Seller may direct, as applicable, in each case for no
additional consideration; and (ii) hold its right, title and interest in and to
such Purchased Asset or Excluded Asset, as applicable, in trust for the
applicable transferee until such time as such transfer is completed.
 
Section 7.8.          Governmental Approvals.
 
(a)                As soon as reasonably practicable following the date hereof,
Seller and Buyer will each file or cause to be filed with the NJBPU, joint
applications for approval of the transactions contemplated hereby. Seller and
Buyer will, and will cause their respective Affiliates to, cooperate with each
other and use reasonable best efforts to (i) promptly prepare and file all
necessary applications, notices, petitions, and filings and execute all
agreements and documents, to the extent required by Law or Order for
consummation of the transactions contemplated by this Agreement (including the
Required Regulatory Approvals and compliance with ISRA), (ii) obtain the
transfer to Buyer of all Transferable Permits and the reissuance to Buyer of all
Permits that are not Transferable Permits, and (iii) obtain the consents,
approvals, and authorizations of all Governmental Entities to the extent
required by Law or Order for consummation of the transactions contemplated by
this Agreement (including the Required Regulatory Approvals). Each Party will,
and will cause its Affiliates to, consult and cooperate with the other Party as
to the appropriate time of all such filings and notifications, furnish to the
other Party such necessary information and reasonable assistance in connection
with the preparation of such filings, and respond promptly to any requests for
additional information made in connection therewith by any Governmental Entity.
To the extent permitted under applicable Law, Seller and Buyer each will have
the right to review in advance all characterizations of the information relating
to it or to the transactions contemplated by this Agreement which appear in any
filing made by the other Party or any of its Affiliates in connection with the
transactions contemplated hereby. In addition to the foregoing, each Party
agrees that prior to the Closing, other than in the ordinary course of business,
(x) it will not include in any such applications, notices, petitions or filings
to or with the NJBPU, any requests or proposals that any business subject to the
NJBPU’s jurisdiction receive more favorable treatment (whether through increased
rates, more favorable terms of service, or otherwise, to such Party or any of
its Affiliates) than is currently applicable and (y) it will not separately file
or make any applications, notices, petitions or filings to or with the NJBPU
that are in any way inconsistent with obtaining the Required Regulatory
Approvals or the consummation of the transactions contemplated by this
Agreement.

(b)               To the fullest extent practicable and permitted by Law, in
connection with any communications, meetings, or other contacts, oral or
written, with any Governmental Entity

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in connection with the transactions contemplated hereby, each Party shall (and
will cause its Affiliates to): (i) inform the other Party in advance of any such
communication, meeting, or other contact which such Party or any of its
Affiliates proposes or intends to make, including the subject matter, contents,
intended agenda, and other aspects of any of the foregoing; (ii) consult and
cooperate with the other Party, and to take into account the comments of the
other Party in connection with any of the matters covered by Section 7.8(a);
(iii) permit for representatives of the other Party to participate to the
maximum extent possible in any such communications, meetings, or other contacts;
(iv) notify the other Party of any oral communications with any Governmental
Entity relating to any of the foregoing; and (v) provide the other Party with
copies of all written communications with any Governmental Entity relating to
any of the foregoing. Nothing in this Section 7.8(b) will apply to or restrict
communications or other actions by a Party with or with respect to any
Governmental Entity in connection with its business in the ordinary course of
business.
 
(c)                Without limiting the foregoing, Buyer shall not, and shall
cause its Affiliates not to, take any action, including (i) acquiring any asset,
property, business or Person (by way of merger, consolidation, share exchange,
investment, or other business combination, asset, stock or equity purchase, or
otherwise), (ii) making any filing or transfer or (iii) taking any other action,
that in each case could reasonably be expected to materially increase the risk
of not obtaining any consent contemplated by this ‎Section 7.8. In furtherance
of and without limiting any of Buyer’s covenants and agreements under this
Section 7.8, Buyer shall, and shall cause each Affiliate to, take, or cause to
be taken, any and all steps and to make, or cause to be made, any and all
undertakings necessary to avoid or eliminate each and every impediment asserted
by any Governmental Entity in connection with obtaining the Required Regulatory
Approvals, so as to enable the Closing to occur as promptly as practicable,
including (i) agreeing to conditions imposed by, or taking any action required
by, any Governmental Entity, (ii) defending through litigation on the merits,
including appeals, any Claim asserted by any court or other proceeding by any
Person, including any Governmental Entity, that seeks to or could prevent or
prohibit or impede, interfere with or delay the consummation of the Closing;
(iii) proposing, negotiating, committing to and effecting, by consent decree,
hold separate order or otherwise, the sale, divestiture, licensing or
disposition of any assets or business of Buyer or its Affiliates or the
Purchased Assets, including entering into customary ancillary agreements
relating to any such sale, divestiture, licensing or disposition; (iv) agreeing
to any limitation on the conduct of Buyer or its Affiliates, including after the
Closing with respect to the Purchased Assets; and (v) agreeing to take any other
action as may be required by a Governmental Entity in order to effect each of
the following: (1) obtaining all Required Regulatory Approvals as soon as
reasonably possible and in any event before the Termination Date, (2) avoiding
the entry of, or having vacated, lifted, dissolved, reversed or overturned any
Order, whether temporary, preliminary or permanent, that is in effect that
prohibits, prevents or restricts consummation of, or impedes, interferes with or
delays, the Closing and (3) effecting the expiration or termination of any
waiting period, which would otherwise have the effect of preventing, prohibiting
or restricting consummation of the Closing or impeding, interfering with or
delaying the Closing, in each case as may be required in order to obtain the
Required Regulatory Approvals or to avoid the entry of, or to effect the lifting
or dissolution of, any injunction, temporary restraining order or other order in
any suit or proceeding, which would otherwise have the effect of preventing or
delaying the Closing. Notwithstanding the foregoing or anything in this
Agreement to the contrary, Buyer shall not be required to, and Seller shall not,
in connection with obtaining the Required

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Regulatory Approvals, consent to or take any action with respect to the
Purchased Assets, in each case, that, individually or in the aggregate, would
reasonably be expected to have a material adverse effect on the Business taken
as a whole. For the avoidance of doubt, none of the exclusions set forth in the
definition of “Material Adverse Effect” shall be deemed to apply to any
reference to “material adverse effect” in this Section 7.8(c).

(d)               Notwithstanding the foregoing or anything in this Agreement to
the contrary, Seller shall not be required to, and Buyer shall not, in
connection with obtaining the Required Regulatory Approvals, consent to (x) the
taking of any action or the imposition of any terms, conditions, limitations or
standards of service the effectiveness or consummation of which is not
conditional upon the occurrence of the Closing or (y) the imposition of any
terms, conditions or limitations on or with respect to Seller, any of its
Affiliates, any of their respective businesses or any of the benefits to Seller
and its Affiliates of the transactions.
 
Section 7.9.          Tax Matters.
 
(a)                Allocation of Purchase Price. The sum of the Purchase Price
and the Assumed Obligations (plus any other liabilities treated as assumed for
U.S. federal income tax purposes) will be allocated among the Purchased Assets
in accordance with the principles of section 1060 of the Code and the
regulations thereunder (and any corresponding provision of state, local or
foreign Tax Law, as appropriate) pursuant to an allocation schedule (each an
“Allocation Schedule”) to be prepared by Buyer. Buyer shall deliver to Seller an
initial Allocation Schedule within one hundred twenty (120) days of the
Effective Date. If any indemnification payment is made pursuant to Article IX or
any other adjustment to the Purchase Price occurs, Buyer shall promptly revise
any affected Allocation Schedules to take into account such payment or
adjustment in a manner consistent with the principles of section 1060 of the
Code and the regulations thereunder (and any corresponding provision of state,
local or foreign Tax Law, as appropriate). Buyer shall provide the Allocation
Schedule (and any revision to the Allocation Schedule necessitated by an
adjustment of the Purchase Price) to Seller for Seller’s review and comment.
Seller shall provide any comments to Buyer within forty-five (45) days of
receiving the Allocation Schedule (or any revision to the Allocation Schedule).
Buyer shall consider Seller’s comments in good faith. If Buyer objects to
Seller’s comments, Buyer and Seller shall use commercially reasonable efforts to
settle the dispute with respect to such comments promptly. If Buyer and Seller
have not resolved such dispute within thirty (30) days of Buyer’s receipt of
Seller’s comments, Buyer and Seller shall jointly retain a nationally recognized
tax expert (a “Tax Dispute Referee”) to resolve disputed items. The findings of
the Tax Dispute Referee shall be final and binding on the Parties. Upon final
resolution of disputed items, the Allocation Schedule shall be adjusted to
reflect such resolution. The costs, fees and expenses of the Tax Dispute Referee
incurred in connection with a dispute relating to the Allocation Schedule shall
be borne equally by Seller and Buyer. Buyer and Seller hereby covenant and agree
to (i) be bound by the Allocation Schedules for all income Tax purposes, (ii)
prepare and file all Tax Returns on a basis consistent with each such Allocation
Schedule and (iii) not take any position on any Tax Return, before any
Governmental Entity charged with the collection of any Tax, or in any judicial
proceeding that is in any way inconsistent with the terms of any such Allocation
Schedule unless required to do so by applicable Law. Each Party will provide the
other promptly with any other information required to complete Form 8594 under
the Code.

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(b)                Responsibility for Taxes. Seller shall bear sole
responsibility for the payment of, and shall indemnify Buyer and its Affiliates
from, (i) all Pre-Closing Taxes and (ii) Seller’s share of any Transfer Taxes
under Section 7.9(h). Buyer shall bear sole responsibility for the payment of,
and shall indemnify Seller and its Affiliates from, (i) all Post-Closing Taxes
and (ii) Buyer’s share of any Transfer Taxes under Section 7.9(h).
Notwithstanding anything to the contrary in this Agreement, except for Section
9.3(d), Section 9.3(e), Section 9.4(b)(ii) and Section 9.6, the provisions of
Article IX shall not apply to this Section 7.9.
 
(c)                Proration of Straddle Tax Period Taxes. In the case of any
Taxes (other than Transfer Taxes) that are payable for a Straddle Tax Period,
the portion of such Taxes that are Pre-Closing Taxes shall (i) in the case of
any real and personal property Taxes, be deemed to be the amount of such Tax for
the entire Taxable Period multiplied by a fraction the numerator of which is the
amount of time from the beginning of the relevant Taxable Period to the
Effective Time and the denominator of which is the amount of time in the entire
Taxable Period and (ii) in the case of all other Taxes, be equal to the portion
of such Tax that would have been payable if the relevant Taxable Period ended at
the Effective Time. All determinations necessary to give effect to the
allocation set forth in the foregoing clause (ii) shall be made in a manner
consistent with prior practice of Seller, except as otherwise required by
applicable Law. For the avoidance of doubt, regardless of the type of Taxes
being allocated, any item attributable to any action taken by Buyer during a
Straddle Tax Period after the Effective Time that is not in the ordinary course
of business will not be attributable to a Pre-Closing Tax Period and any Taxes
resulting from such actions shall be borne solely by Buyer.
 
(d)                Preparation and Filing of Tax Returns. Buyer shall timely
prepare and file, or cause to be prepared and filed, all Tax Returns with
respect to the Business or the Purchased Assets for any Straddle Tax Period. All
such Tax Returns shall be prepared and filed in accordance with past practices
and the requirements of this Agreement except to the extent required by Law.
Buyer shall provide any such Tax Return to Seller for Seller’s review and
comment at least forty-five (45) days prior to the due date for filing such Tax
Return. Buyer shall consider Seller’s comments in good faith. If Buyer objects
to Seller’s comments, Seller and Buyer shall use commercially reasonable efforts
to settle the dispute with respect to such comments promptly. If Buyer and
Seller have not resolved such dispute at least twenty (20) days prior to the due
date for filing such Tax Return, Seller and Buyer shall jointly retain a Tax
Dispute Referee to resolve disputed items. The findings of the Tax Dispute
Referee shall be final and binding on the Parties. Upon final resolution of
disputed items, the Tax Return shall be adjusted to reflect such resolution.
Buyer shall timely pay in the manner required by applicable Law to the relevant
tax authority all Taxes that are shown as due on such Tax Returns. Seller shall
pay to Buyer an amount equal to any Pre-Closing Taxes shown as due on any Tax
Return for a Straddle Tax Period no later than five (5) days before any such Tax
is due unless there is a dispute that has not been resolved by such date, in
which case Seller shall pay Buyer the amount of such disputed Tax within five
(5) days of the resolution of such disputed Tax. The costs, fees and expenses of
the Tax Dispute Referee incurred in connection with a dispute relating to a Tax
Return shall be borne equally by Seller and Buyer.

(e)                Tax Contests. Buyer and Seller agree to cooperate with each
other to the extent reasonably required after the Effective Date in connection
with any Tax Contests relating to any Pre-Closing Tax Period or Straddle Tax
Period. Promptly (but no more than twenty (20)

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days) after Buyer (or any of its Affiliates) or Seller (or any of its
Affiliates) receives notice of any such Tax Contest, the party receiving the
notice shall notify the other party in writing of the Tax Contest; provided,
however, that failure to provide such notice shall not relieve any Party of its
obligations pursuant to this Section 7.9 except to the extent such failure
materially prejudices such Party. Seller shall control all Tax Contests relating
exclusively to Pre-Closing Tax Periods. Additionally, if Seller’s Tax liability
could be affected by a Tax Contest relating to a Straddle Tax Period or if
Seller could have an indemnification obligation under this Agreement with
respect thereto, Seller shall have the right to conduct and control the defense
of such Tax Contest at its expense, and Buyer shall provide Seller with all
necessary powers of attorney and other documents and assistance reasonably
requested by Seller to allow Seller to effectively conduct and control such
defense. Seller shall not be responsible for any Taxes to the extent
attributable to any action taken by Buyer with respect to any Tax Contest
without Seller’s written consent (not to be unreasonably withheld). This Section
7.9(e), rather than Section 9.3, shall govern control of all Third Party Claims
that relate to Taxes.
 
(f)                 Cooperation. Buyer and Seller agree to furnish or cause to
be furnished to each other, upon request, as promptly as practicable, such
information and assistance relating to the Business and the Purchased Assets
(including access to books and records) as is reasonably necessary for the
preparation and filing of all Tax Returns, the making of any election relating
to Taxes, the preparation for any audit by any tax authority, and the
prosecution or defense of any claim, suit or proceeding relating to any Tax;
provided, however, that neither Buyer nor Seller shall be required to furnish or
cause to be furnished any Tax Returns or provide access to any books or records
to the extent not related to the Business or the Purchased Assets. Buyer and
Seller shall retain all books and records with respect to Taxes pertaining to
the Business and the Purchased Assets for a period of at least seven (7) years
following the Effective Date. Seller and Buyer shall cooperate with each other
in the conduct of any audit or other proceeding relating to Taxes involving the
Business or the Purchased Assets.
 
(g)                Tax Refunds. Any refund or credit received by Buyer or any
Affiliate of Buyer with respect to Pre-Closing Taxes, whether such refund is
received as a payment or as a credit, abatement or similar offset against future
Taxes payable, shall be for the account of Seller. Buyer shall pay to Seller the
amount of any such refund or credit within five (5) days after receipt.
 
(h)                Transfer Taxes. All Transfer Taxes incurred in connection
with this Agreement, the Ancillary Agreements and any transactions contemplated
by such agreements shall be borne and paid, or caused to be paid, by Buyer and
Seller equally. Buyer and Seller shall cooperate to minimize the incurrence of
any such Transfer Taxes. Buyer and Seller shall cooperate in timely making and
filing all Tax Returns as may be required to comply with the provisions of laws
relating to such Transfer Taxes. To the extent permitted by applicable Law,
Buyer will file all necessary Tax Returns and other documentation with respect
to all Transfer Taxes, and, if required by applicable Law, Seller will join in
the execution of any such Tax Returns and related documentation. To the extent
any Tax Return with respect to Transfer Taxes is required by applicable Law to
be filed by Seller and Buyer provides Seller with reasonable notice of such
requirement, Seller will file such Tax Return and other documentation and pay
any amount of Tax shown as due on such Tax Return, and Buyer shall pay to Seller
one-half of the amount of Tax shown as due for any such Tax Return no later than
five (5) days before any

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such Tax is due and, if required by applicable Law, shall join in the execution
of any such Tax Returns and related documentation. Buyer and Seller shall
cooperate in providing each other with any appropriate resale exemption
certifications and other similar documentation.

(i)                 Seller Consolidated Tax Returns. For the avoidance of doubt
and notwithstanding anything to the contrary in this Agreement or any of the
Ancillary Agreements, Seller shall have the exclusive right to control all
matters, including all Tax Contests, relating to any consolidated, combined or
unitary group of corporations that includes Seller or any Affiliate of Seller,
and Seller shall not be required to provide copies of any Tax Returns with
respect thereto to Buyer or any of its Affiliates.
 
(j)                 Post-Closing Covenants. Except as permitted by ‎Section
7.9(d) or ‎Section 7.9(e), or otherwise with the prior written consent of
Seller, Buyer shall not, and shall cause its Affiliates not to, (a) amend,
refile, revoke or otherwise modify any Tax Return or Tax election with respect
to a Pre-Closing Tax Period, (b) make any Tax election or change any accounting
period or method with retroactive effect to any such Pre-Closing Tax Period, (c)
take any action to extend the applicable statute of limitations with respect to
any Tax Return for a Pre-Closing Tax Period, (d) surrender any right to claim a
refund of any Pre-Closing Taxes, or (e) take any similar action relating to
Pre-Closing Taxes or Tax Returns for any Pre-Closing Tax Periods.
 
Section 7.10.        Employees.
 
(a)                Schedule 7.10(a) sets forth a list of the Business Employees
together with each such Business Employee’s date of hire, years of service, and
base pay in effect as of the date hereof, and status as an employee covered by
the Labor Agreement. Business Employees covered by the Labor Agreement are
hereafter referred to as “Represented Employees”. In the event that any Business
Employee ceases to be employed by Seller or its Affiliates prior to the
Effective Time, Seller by delivery of written notice thereof to Buyer, shall
promptly update Schedule 7.10(a) to remove from such list the name of such
person.
 
(b)                Subject to this Section 7.10(b), Buyer will give Qualifying
Offers of employment to each of the Business Employees at least fifteen (15)
Business Days prior to the anticipated Effective Date or a later date approved
by Seller in writing, which approval shall not be unreasonably withheld. As used
herein, a “Qualifying Offer” means an offer by Buyer to continue “at-will”
employment with the Business commencing at the Closing (i) at a level of base
pay (and bonus opportunity) at least equal to such employee’s base pay (and
bonus opportunity) in effect immediately prior to the Effective Time and as set
forth on Schedule 7.10(a), (ii) with an initial primary work location within a
thirty (30) mile radius from such employee’s primary work location immediately
prior to the Effective Time, and (iii) with compensation and benefits that are
no less favorable in the aggregate than the compensation and benefits (including
equity-based compensation and severance benefits) provided to such Business
Employee immediately prior to the Effective Time. All Qualifying Offers of
employment made by Buyer pursuant to this Section 7.10(b) will be made in
accordance with all applicable Laws, will be conditioned on the occurrence of
the Closing, and will include such additional information as shall be mutually
agreed by Seller and Buyer. Each Business Employee who is given a Qualifying
Offer and who accepts an offer of employment from Buyer pursuant to this Section
7.10(b) is referred to herein as a “Transferred Employee.”

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(c)                Upon the Closing, Seller and its Affiliates will terminate
the employment of all Transferred Employees with Seller and its Affiliates. On
and after the Effective Time, Buyer shall be solely responsible for any and all
Losses related to any Business Employee and Buyer shall indemnify and hold
harmless Seller from and against any such Losses.
 
(d)                Through the Effective Time, Seller or its Affiliate will
maintain the short term disability and long term disability plans or programs,
worker’s compensation and any related insurance policies or other funding or
administrative arrangements, presently in effect with respect to the Business
Employees, and will handle any claim for benefits thereunder in the ordinary
course of business. Prior to the Closing, Seller or its Affiliate will take all
steps reasonably necessary and appropriate to transfer and assign all such
insurance policies and other funding arrangements and Seller’s or its
Affiliate’s rights to Buyer effective as of the Effective Time, at which time
Buyer will assume responsibility for all such disability benefits in respect to
the Transferred Employees. If Seller, its Affiliate or the insurance carrier of
Seller or its Affiliate makes any payments for worker’s compensation, short term
disability or long term disability to or on behalf of any Transferred Employee
that are the responsibility of Buyer as provided in this Agreement, Buyer shall
reimburse Seller or its Affiliate, as applicable, for the payments, promptly
after receipt of any accounting statement from Seller, to the extent of Seller’s
or its Affiliate’s out-of-pocket costs therefor.
 
(e)                Prior to the Effective Date, Seller and Buyer shall cooperate
and Buyer shall take all action reasonably necessary in order for Buyer to
become a successor to Seller’s obligations under the Labor Agreement, effective
for periods after the Effective Time; provided, that the liabilities and
obligations under the Labor Agreement shall be assumed only to the extent that
such liabilities and obligations arise, relate to and are required to be
performed during periods after the Effective Time.
 
Section 7.11.        Employee Benefits.
 
(a)                As of the Effective Time and for a period expiring at the end
of the first full calendar year following the year in which the Closing occurs
(the “Continuation Period”), Buyer will (i) allow each of the Transferred
Employees to participate in Buyer-sponsored benefit plans on a similar basis as
made available by Buyer to its other employees who are similarly situated after
taking into account such Transferred Employee’s service with Seller or an
Affiliate of Seller, (ii) provide to each Transferred Employee base pay that is
not less than such Transferred Employee’s base pay immediately prior to the
Effective Time and (iii) provide each Transferred Employee with compensation and
benefits that are no less favorable in the aggregate than the compensation and
benefits (including equity-based compensation and severance benefits) provided
to such Transferred Employee immediately prior to the Effective Time. If any
Transferred Employee’s employment is terminated within the Continuation Period,
Buyer will provide such Transferred Employee with severance benefits pursuant to
the terms of Buyer’s applicable severance plan or policy; provided, however,
that, in accordance with Section 7.10(b), above, the calculation of any such
severance benefits shall take into account such Transferred Employee’s service
with Seller or an Affiliate of Seller. The form and terms of any particular
benefit plan offered by Buyer (“Buyer Benefit Plan”) shall be as determined by
Buyer, subject to the foregoing and the other provisions of this Section 7.11.
Notwithstanding the foregoing, this Section 7.11(a) shall not apply to
Represented Employees, the terms and conditions of whose

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employment shall be as set out in the Labor Agreement (as it may be amended from
time-to-time) and applicable Law.

(b)               Buyer will recognize the service and seniority of each of the
Transferred Employees recognized by Seller for all benefits purposes, including
eligibility for, vesting and accrual of, and determination of the levels of such
benefits. However, service will not be recognized to the extent it would result
in duplication of benefits for the same period of service.
 
(c)                Seller shall fully vest all Transferred Employees in their
account balances under the retirement savings plan in which such Transferred
Employees participate (the “Seller’s 401(k) Plan”), effective as of the
Effective Time. Effective as of the Effective Time, Buyer shall maintain or
designate, or cause to be maintained or designated, a defined contribution plan
and related trust intended to be qualified under sections 401(a), 401(k) and
501(a) of the Code (the “Buyer’s 401(k) Plan”). Effective as of the Effective
Time, the Transferred Employees shall cease participation in Seller’s 401(k)
Plan. The Transferred Employees shall be eligible to participate and shall
commence participation in Buyer’s 401(k) Plan in accordance with the terms of
Buyer’s 401(k) Plan. Seller and Buyer shall cooperate and take, or cause to be
taken, reasonable best efforts to permit each Transferred Employee to make
rollover contributions of “eligible rollover distributions” (within the meaning
of section 401(a)(31) of the Code) to Buyer’s 401(k) Plan in cash in an amount
equal to the full account balance distributed to such Transferred Employee from
Seller’s 401(k) Plan. Buyer will use reasonable best efforts to permit such
rollover contributions in the form of notes representing an employee loan under
Seller’s 401(k) Plan and Buyer shall take (or cause to be taken) any and all
reasonable action as may be required to provide that Transferred Employees may
continue to service any such loans through payroll deductions after the Closing.
Seller shall fully vest all Transferred Employees in their account balances
under Seller’s nonqualified savings plan, effective as of the Effective Time.
 
(d)                With regard to the AGL Resources Inc. Retirement Plan or the
successor plan thereto (the “Seller Pension Plan”), each Pension Participant
shall cease to be a participant under such plan effective as of the Effective
Time. Effective as of the Effective Time, Buyer shall have in effect a
tax-qualified defined benefit pension plan (the “Buyer Pension Plan” which may,
for the avoidance of doubt, be a preexisting plan of Buyer) with benefits and
other terms and conditions equivalent to the Seller Pension Plan, in each case,
in which the Pension Participants shall be eligible to participate. As soon as
practicable after the Effective Time, Seller shall cause the calculation and
transfer to the Buyer Pension Plan of assets equal to (i) the amount required to
be transferred pursuant to Section 414(l) of the Code, Treasury Regulation
Section 1.414(l)-1(n)(2) (unless the requirements of such section cannot be
satisfied) and such other applicable law using the actuarial assumptions and
methodology consistent with those used by Seller in its measurement of the
accumulated benefit obligation of the Seller Pension Plan under Accounting
Standards Codification Section 715 (the “ABO”) with respect to the Pension
Participants, as determined by the Seller’s actuaries as of the Effective Time,
(for the avoidance of doubt, such actuarial assumptions and methodology are
agreed by Seller and Buyer to satisfy the reasonability requirements specified
in Section 414(l) of the Code), subject to any requirements under such Section
of the Code and ERISA (the “Section 414(l) Amount”); plus (ii) for the period
between the Effective Time and the date such assets are transferred (the
“Transfer Date”), an interest increment on the Section 414(l) Amount at the rate
equal to the yield on the

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three month US Treasury Bill rate as of the Effective Time; less (iii) any
benefit payments that are made from the Seller Pension Plan to each Pension
Participant for the period between the Effective Time and the Transfer Date;
less (iv) any costs or expenses incurred by Seller in respect of Pension
Participant benefits of the Seller Pension Plan for the period between the
Effective Time and the Transfer Date. The transfer of the amount from the Seller
Pension Plan to the Buyer Pension Plan shall be made in cash. Such transfer
shall be subject to Seller’s receipt of a current determination letter from the
Internal Revenue Service indicating that the Buyer Pension Plan is qualified
under Section 401(a) of the Code. The Buyer Pension Plan shall recognize and
credit all service (including, without limitation, for purposes of benefit
accrual) of the Pension Participants credited under the Seller Pension Plan.
Following such transfer from the Seller Pension Plan to the Buyer Pension Plan,
the Seller Pension Plan shall have no liability to or with respect to any
Pension Participant with respect to their accrued benefits under the Seller
Pension Plan, and Buyer shall indemnify and hold harmless Seller and its
Affiliates from all liabilities, costs and expenses that may result to Seller or
such Affiliates or the Seller Pension Plan from any claim by or on behalf of any
Pension Participant for any benefit alleged to be payable under the Seller
Pension Plan. To the extent that the amount of assets transferred to the Buyer
Pension Plan pursuant to this Section 7.11(d) is less than the ABO (i.e.,
because of the operation of Section 414(l) of the Code), Seller shall pay Buyer
the difference in cash at the same time the plan-to-plan asset transfer is
effected.

(e)                Buyer agrees to provide those employees whose work
responsibilities related primarily to the Business, and who retired prior to the
Closing, and who are listed on Schedule 7.11(e) with benefits that are
equivalent to those benefits that would have been available to those employees
had they remained covered under the Health and Welfare Plan for Retirees &
Inactive Employees of AGL Resources, Inc. for a period of two (2) years from the
Effective Time. As soon as practicable following the Closing, the assets and
liabilities associated with those employees whose work responsibilities related
primarily to the Business in the NUI Corporation Employee Welfare Trust (the
“Welfare Trust”) shall be transferred to a voluntary employees beneficiary
association plan maintained by Buyer (the “Buyer VEBA”). The assets shall be
transferred in cash. The amount of assets transferred shall be determined based
on a pro-rata allocation of the Welfare Trust assets using the retiree medical
accumulated postretirement benefit obligation (the “APBO”) covered under the
Welfare Trust for the group for whom the transfer is effected compared to the
APBO for all benefits covered under the Welfare Trust. For the avoidance of
doubt, the retiree life APBO to be transferred to the Buyer does not have any
corresponding assets under the Welfare Trust.
 
(f)                 Buyer will use reasonable best efforts to waive or cause the
waiver of any limitation on benefits relating to pre-existing conditions,
actively-at-work exclusions and waiting periods for the Transferred Employees
under a Buyer Benefit Plan that provides group medical benefits to the extent
that such limitations are waived or otherwise inapplicable to a Transferred
Employee under any comparable plan of Seller as of the Effective Date. All
health care expenses incurred by Transferred Employees or any eligible dependent
thereof, including any alternate recipient pursuant to qualified medical child
support orders, in the portion of the calendar year preceding the Effective Date
that were qualified to be taken into account for purposes of satisfying any
deductible or out-of-pocket limit under any Seller health care plans will be
taken into account for purposes of satisfying any deductible or out-of-pocket
limit under the health care plan of Buyer for such calendar year.

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(g)                Seller will be responsible for providing COBRA Continuation
Coverage to any current and former employees of Seller, or to any qualified
beneficiaries of such employees, who become entitled to COBRA Continuation
Coverage as a result of loss of medical coverage under a Benefit Plan maintained
by Seller or any of its ERISA Affiliates. Buyer will be responsible for offering
and providing COBRA Continuation Coverage to any Transferred Employees (and
their qualified beneficiaries) who become entitled to such COBRA Continuation
Coverage on or after the Closing as a result of their loss of medical coverage
under any Buyer Benefit Plan.
 
(h)                Seller hereby acknowledges that, for Federal Insurance
Contributions Act and Federal Unemployment Tax Act tax purposes, Buyer qualifies
as a successor employer with respect to the Transferred Employees. In connection
with the foregoing, the parties agree to follow the “Alternative Procedures” set
forth in Section 5 of Revenue Procedure 2004-53, 2004-2 C.B. 320. In connection
with the application of the “Alternative Procedures,” (i) Seller and Buyer each
shall report on a predecessor-successor basis as set forth in such Revenue
Procedure, (ii) provided, that Seller provides to Buyer all necessary payroll
records for the calendar year that includes the Effective Time, Seller shall be
relieved from furnishing Forms W-2 to employees of Seller or its Affiliates that
become employees of Buyer, and (iii) provided, that Seller provides to Buyer all
necessary payroll records for the calendar year that includes the Effective
Time, Buyer shall assume the obligations of Seller to furnish such Forms W-2 to
such employees for the full calendar year in which the Closing occurs.
 
(i)                 Buyer and Seller acknowledge and agree that all provisions
contained in Section 7.10 and this Section 7.11 are included for the sole
benefit of Buyer and Seller, and that nothing contained herein, express or
implied, is intended to (i) confer upon any Person (including any Business
Employee) any right to continued employment for any period or continued receipt
of any specific employee benefit, (ii) constitute an amendment to or any other
modification of any employee benefit plan, program or agreement of any kind or
(iii) create any third party beneficiary or other rights in any other Person,
including any Business Employees (or representatives thereof), former Business
Employees, any participant in any benefit plan or any dependent or beneficiary
thereof. Nothing in this Agreement shall be interpreted as limiting the power of
Buyer, Seller or any of their Affiliates to amend or terminate any particular
employee benefit plan, program, agreement or policy.
 
Section 7.12.        Signage. Within ninety (90) days following Closing, Buyer
shall, and shall cause the Business to, cease using Seller Marks including
removing Seller Marks from the Purchased Assets or any properties or assets
relating to the Business, and Buyer shall not, and shall cause the Business not
to, use Seller Marks or any logos, Trademarks or trade names belonging to Seller
or any Affiliate thereof, and Buyer acknowledges that it and its Affiliates have
no rights whatsoever to use Seller Marks or such logos, Trademarks or trade
names or related Intellectual Property. Notwithstanding Buyer’s right to use
Seller Marks for the time periods set forth above, Buyer agrees that (a) neither
Buyer nor any of its Affiliates shall be deemed an agent, representative or
joint venture partner of Seller; (b) Seller and its Affiliates shall retain sole
and exclusive ownership of Seller Marks, and all goodwill and rights related
thereto; and (c) Buyer and its Affiliates shall not knowingly take any action in
respect of Seller Marks that would adversely affect Seller or its Affiliates, or
the interest of Seller or its Affiliates in the Seller Marks.

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Section 7.13.        Insurance Settlement; Cooperation.
 
(a)                Buyer agrees to cooperate with Seller to take such steps as
may be reasonably necessary to finalize and implement the insurance settlements
negotiated by Seller prior to Closing with respect to the certain insurance
policies of Seller as described in more detail on Schedule 7.13(a).
 
(b)                Following the Closing, Buyer and Seller will cooperate on the
matters set forth on Schedule 7.13(b) (the “Other Indemnified Matters”).
 
Section 7.14.        Notification of Customers. As soon as practicable following
the Closing, Seller and Buyer will use their respective commercially reasonable
efforts to cause to be sent to customers of the Business written notice that
such customers have been transferred from Seller to Buyer. Such notice will
contain such information as is required by Law and approved by Buyer and Seller,
which approval will not be unreasonably withheld, conditioned or delayed.
 
Section 7.15.        Public Statements. No Party hereto shall issue, or permit
any of its Affiliates or Representatives to issue, any press release or
otherwise make any public statements or announcements regarding this Agreement
or the transactions contemplated hereby without the prior written consent (which
consent will not be unreasonably withheld, conditioned or delayed) of the other
Party, except as otherwise determined to be necessary or appropriate to comply
with applicable Law or any rules or regulations of any supervisory, regulatory
or other Governmental Entity having jurisdiction over it or any of its
Affiliates (including the Securities and Exchange Commission and the New York
Stock Exchange), in which case the Party required to issue such press release or
public announcement shall use reasonable efforts to provide the other Party a
reasonable opportunity to comment on such press release or public announcement
in advance of such publication. The Parties hereto will consult with each other
concerning the means by which the employees, customers, and suppliers of the
Business and others having dealings with the Business will be informed of the
transactions contemplated by this Agreement. Notwithstanding the foregoing,
nothing contained in this Agreement shall limit either Party’s (or either
Party’s respective Affiliates’) rights to disclose the existence of this
Agreement and the general nature of the transaction described herein on any
earnings call or in similar discussions with financial media or analysts,
stockholders and other members of the investment community.
 
Section 7.16.        Supplements to Seller Disclosure Schedules. From time to
time prior to the Closing, Seller may supplement or amend the Seller Disclosure
Schedules to properly reflect matters arising after the date hereof (or, in the
case of matters that are based on Seller’s Knowledge, matters that first come to
Seller’s Knowledge after the date hereof) (i) that result from the operation of
the Business after the date hereof consistent with the requirements of Section
7.1 (an “Ordinary Course Update”) or (ii) that, if existing on the date hereof
would constitute a breach of any of Seller’s representations and warranties
hereunder if not set forth on, or described in, the Seller Disclosure Schedules
(a “Schedule Update”). In the event that Seller provides written notice to Buyer
prior to Closing of a Schedule Update and the Closing nevertheless occurs, any
breach of any representation or warranty made by Seller which would exist absent
such Schedule Update will be deemed cured and all rights of Buyer with respect
to such breach shall be deemed waived.

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Section 7.17.        Collections; Remittances. From and after the Effective
Time, (a) Seller shall promptly remit to Buyer any amounts that are collected or
received by Seller that are for the account of Buyer pursuant to the terms of
this Agreement, and (b) Buyer shall, and shall cause its Affiliates to, promptly
remit to Seller any amounts that are collected or received by Buyer or any such
Affiliate that are for the account of Seller pursuant to the terms of this
Agreement.
 
Section 7.18.        Post-Closing Covenants Related to Elizabethtown Gas Name.
At the Effective Date, and from time to time thereafter as reasonably requested
in writing by Buyer, Seller shall make appropriate filings and to affect the
transfer of all of Seller’s rights to the Assigned IP, including providing for
the transfer of the Assigned IP on the Effective Date. Prior to the Effective
Date, Buyer will establish an account with GoDaddy.com, Inc., the registrar for
the elizabethtowngas.com domain.
 
Section 7.19.      Replacement of Guarantees or Other Credit Support. Buyer
acknowledges and agrees that neither Seller nor any of its Affiliates shall have
any obligations to maintain any guarantee or other form of credit support to
secure performance or payment under any Purchased Business Agreements after the
Closing. Buyer shall use its reasonable efforts to obtain and deliver to Seller,
prior to the Closing and to be effective upon the Closing, a full and
unconditional release of all of the obligations of Seller and its Affiliates
under each of the agreements and instruments set forth on Schedule 7.19 (the
“Guarantees”) by providing the counterparties thereto and beneficiaries thereof
with a substitute form of security. In the event that any such counterparty or
beneficiary does not accept a substitute form of security prior to the Closing,
Buyer shall continue to use its reasonable efforts to obtain and deliver to
Seller as promptly as practicable after the Closing a full and unconditional
release of all of the obligations of Seller and its Affiliates under any of the
Guarantees that remain outstanding (the “Continuing Guarantees”). Buyer
acknowledges that the obligations of Seller and its Affiliates under the
Continuing Guarantees arising after the Closing are for the account of Buyer and
any Indemnifiable Losses suffered, paid or incurred by Seller and its Affiliates
in respect thereof shall be paid or reimbursed by Buyer, as applicable, and
shall otherwise be subject to indemnification by Buyer as Assumed Obligations.
Buyer agrees to deliver to Seller at Closing and maintain in effect a letter of
credit or other reasonable form of security in respect of Buyer’s
indemnification obligations relating to each Continuing Guarantee until such
time as there has been a full and unconditional release of Seller and its
Affiliates from all obligations thereunder. Buyer shall not, and shall not
permit any of its Affiliates to: (i) renew or extend the term of, (ii) increase
the obligations under, or (iii) transfer to a third party any Business Agreement
or other obligation covered by a Continuing Guarantee.
 
Section 7.20.        Financing Covenant.
 
(a)                Seller agrees to use commercially reasonable efforts to
provide such cooperation as may be reasonably requested by Buyer, at Buyer’s
expense and solely as an accommodation to Buyer, in connection with the
arrangement of any financing to be consummated with respect to the transactions
contemplated hereby; provided that (i) such requested cooperation does not
unreasonably interfere with the ongoing operations of Seller and its Affiliates
and (ii) none of Seller and its Affiliates shall have any liability or
obligation under

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any agreement or document related to such financing or otherwise be required to
incur any liability or obligation in connection with such financing.

(b)               Buyer shall be responsible for all fees and expenses related
to any financing to be consummated in connection with the transactions
contemplated hereby. Accordingly, notwithstanding anything to the contrary in
Section 7.6, Buyer shall promptly reimburse Seller and its Affiliates, as
applicable, for all out-of-pocket costs and expenses (including attorneys’ fees)
incurred by Seller and its Affiliates in connection with such cooperation or
otherwise in connection with any such financing. Buyer shall indemnify and hold
harmless Seller and its Affiliates and their respective Representatives from and
against any and all losses, damages, obligations or liabilities suffered or
incurred by them in connection with any such financing and any information
utilized in connection therewith.
 
ARTICLE VIII 
 
CONDITIONS TO CLOSING
 
Section 8.1.          Conditions to Each Party’s Closing Obligations. The
respective obligations of each Party to effect the transactions contemplated
hereby are subject to the fulfillment or joint waiver by the Parties at or prior
to the Effective Date of the following conditions:
 
(a)                No Order (whether temporary, preliminary or permanent) which
prevents the consummation of the transactions contemplated hereby shall have
been issued and remain in effect (each Party agreeing to use its best efforts to
have any such Order lifted) and no Law shall have been enacted which directly or
indirectly prohibits the consummation of the transactions contemplated hereby.
 
(b)                The Required Regulatory Approvals shall have been obtained.
 
Section 8.2.          Conditions to Buyer’s Closing Obligations. The obligation
of Buyer to effect the transactions contemplated hereby is subject to the
fulfillment or waiver by Buyer at or prior to the Effective Date of the
following additional conditions:
 
(a)                Seller shall have performed and complied in all material
respects with the covenants and agreements contained in this Agreement which are
required to be performed and complied with by Seller on or prior to the
Effective Date;
 
(b)                (i) The Seller Indemnified Representations shall be true and
correct in all material respects as of the date of this Agreement and as of the
Effective Date (except to the extent that any such representation or warranty
speaks as of a particular date, in which case such representation and warranty
will be true and correct only as of such date) and (ii) all other
representations and warranties of Seller set forth in Article V of this
Agreement shall be true and correct (without giving effect to any limitation as
to materiality or Material Adverse Effect set forth therein or any Schedule
Update other than Ordinary Course Updates), as of the date of this Agreement and
as of the Effective Date as though made at and as of the Effective Date (except
to the extent that any such representation or warranty speaks as of a particular
date, in which case such representation and warranty will be true and correct
only as of such date), except for any

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failure or failures of such representations and warranties to be true and
correct that would not, individually or in the aggregate, result in a Material
Adverse Effect;

(c)                Since the date of this Agreement, no Material Adverse Effect
shall have occurred; and
 
(d)                Buyer shall have received a certificate from Seller, signed
on its behalf by an officer of Seller and dated the Effective Date, to the
effect that the conditions set forth in Section 8.2(a), Section 8.2(b) and
Section 8.2(c) have been satisfied.
 
Section 8.3.          Conditions to Seller’s Closing Obligations. The obligation
of Seller to effect the transactions contemplated hereby is subject to the
fulfillment or waiver by Seller at or prior to the Effective Date of the
following additional conditions:
 
(a)                Buyer shall have performed and complied in all material
respects with the covenants and agreements contained in this Agreement which are
required to be performed and complied with by Buyer on or prior to the Effective
Date;
 
(b)                The representations and warranties of Buyer set forth in
Article VI shall be true and correct (without giving effect to any limitation as
to materiality or Material Adverse Effect set forth therein) as of the date of
this Agreement and as of the Effective Time as though made at and as of the
Effective Time (except to the extent that any such representation or warranty
speaks as of a particular date, in which case such representation and warranty
will be true and correct only as of such date), except for any failure or
failures of such representations and warranties to be true and correct that do
not, individually or in the aggregate, cause such representations and warranties
of Buyer to be materially inaccurate taken as a whole or have a material adverse
effect on the ability of Buyer to perform its obligations under this Agreement
or consummate the transactions contemplated hereby on a timely basis; and
 
(c)                Seller shall have received a certificate from Buyer, signed
on its behalf by an officer of Buyer and dated the Effective Date, to the effect
that the conditions set forth in Section 8.3(a) and Section 8.3(b) have been
satisfied.
 
ARTICLE IX 
 
INDEMNIFICATION
 
Section 9.1.          Survival of Representations, Warranties, and Certain
Covenants. The representations and warranties contained in this Agreement and
the covenants and agreements contained in this Agreement which by their terms
are to be performed prior to or at the Closing shall not survive the Closing,
except that the representations and warranties contained in Section 5.2
(Authority and Enforceability), Section 5.6 (Title), Section 5.16 (Brokers and
Finders), (the “Seller Indemnified Representations”) and Section 6.2 (Authority
and Enforceability) and Section 6.5 (Brokers and Finders) (the “Buyer
Indemnified Representations”) will survive the Closing and will expire twelve
(12) months after the Effective Date (the “Survival Period”). The covenants and
agreements to be performed after Closing shall survive for the period provided
in such covenants and agreements, if any, or until fully performed, whichever is
earlier. Notwithstanding the foregoing, any claims asserted in

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connection with this Agreement in good faith with reasonable specificity (to the
extent known at such time) and in writing by notice from the non-breaching Party
to the breaching Party prior to the expiration date of the applicable survival
period shall not thereafter be barred by the expiration of the relevant
representation or warranty and such claims shall survive until finally resolved.
Section 9.2.          Indemnification.
 
(a)                Subject to Section 9.1 and Section 9.4 hereof, from and after
the Closing, Seller will indemnify, defend, and hold harmless Buyer, its
Affiliates and each of their respective Representatives (the “Buyer
Indemnitees”) from and against any and all Claims and Losses (each, an
“Indemnifiable Loss”) incurred or suffered by any Buyer Indemnitee to the extent
resulting from or arising out of:
 
(i)                  any inaccuracy in or breach by Seller of any Seller
Indemnified Representation, as of the date such representation or warranty was
made or as if such representation or warranty was made on and as of the
Effective Date (except for representations or warranties that expressly relate
to any specified date, the inaccuracy in or breach of which will be determined
with reference to such specified date); and
 
(ii)                 the Excluded Liabilities and the Excluded Assets.
 
(b)                Subject to Section 9.1 and Section 9.4 hereof, from and after
the Closing, Buyer will indemnify, defend, and hold harmless Seller, its
Affiliates and each of their respective Representatives (the “Seller
Indemnitees”) from and against any and all Indemnifiable Losses incurred or
suffered by any Seller Indemnitee to the extent resulting from or arising out
of:
 
(i)                 any inaccuracy in or breach by Buyer of any Buyer
Indemnified Representation, as of the date such representation or warranty was
made or as if such representation or warranty was made on and as of the
Effective Date (except for representations or warranties that expressly relate
to any specified date, the inaccuracy in or breach of which will be determined
with reference to such specified date); and
 
(ii)                 the Business, the Purchased Assets and the Assumed
Obligations.
 
Section 9.3.          Indemnification Procedures.
 
(a)                Third Party Claims. If any Person entitled to receive
indemnification under this Agreement (an “Indemnitee”) receives notice of any
Claim by any Person who is neither a Party to this Agreement nor an Affiliate of
a Party to this Agreement (a “Third Party Claim”) for which has or could
reasonably give rise to a right of indemnification hereunder, or which the
Indemnitee may claim a right to indemnification hereunder from the other Party
(the “Indemnifying Party”), the Indemnitee will promptly give written notice (a
“Third Party Claim Notice”) of such Third Party Claim to the Indemnifying Party.
Any such Third Party Claim Notice shall (i) describe the nature, facts and
circumstances of the Third Party Claim in reasonable detail, (ii) state the
estimated amount of the Indemnifiable Loss that has been or may be sustained by
the Indemnitee, if practicable, (iii) state the method and computation thereof,
and (iv) contain specific reference to the provision or provisions of this
Agreement in respect of

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which such right of indemnification is claimed or arises. The Indemnitee shall
provide the Indemnifying Party with such other information known to it or in its
possession with respect to the Third Party Claim as the Indemnifying Party may
reasonably request. The Indemnifying Party, at its sole cost and expense, will
have the right, upon written notice to the Indemnitee within thirty (30) days
(or such earlier time as may be required by the nature of the Third Party Claim)
of receiving a Third Party Claim Notice, to assume the defense of the Third
Party Claim through counsel of its choice, provided, that the Indemnitee shall
be entitled to retain its own counsel, at the Indemnifying Party’s expense, if
(i) upon the advice of Indemnitee’s counsel, a conflict of interest exists (or
would reasonably be expected to arise) that would make it inappropriate for the
same counsel to represent both the Indemnifying Party and Indemnitee in
connection with a Third Party Claim, (ii) the Indemnifying Party fails to
diligently prosecute the defense of the Third Party Claim, or (iii) such Third
Party Claim (A) seeks non-monetary relief, or (B) involves criminal or quasi
criminal allegations and, provided further, that if the aggregate dollar amount
of the Third Party Claim, together with all other Third Party Claims of which
the Indemnifying Party is aware or has received Third Party Claim Notices, and
all costs and expenses reasonably estimated to be incurred in connection with
the defense thereof, would exceed the monetary limitation of the indemnification
obligation applicable to such Third Party Claim (the “Indemnification Cap”), the
Indemnitee may, at its option, and to the extent in excess of the
Indemnification Cap at its sole cost and expense, assume the defense of the
Third Party Claim with counsel of its choice upon written notice to the
Indemnifying Party within fifteen (15) days of receiving a Third Party Claim
Notice.

(b)                Defense of Third Party Claims. If the Indemnifying Party
assumes the defense of a Third Party Claim pursuant to Section 9.3(a), the
Indemnifying Party will diligently pursue such defense, and will keep the
Indemnitee reasonably informed with respect to such defense. The Indemnitee
shall, and shall cause its Affiliates to, cooperate with the Indemnifying Party
and its counsel, including making available to the Indemnifying Party all
witnesses, pertinent records, materials and information in the Indemnitee’s
possession or under the Indemnitee’s control relating thereto as is reasonably
required by the Indemnifying Party. The Indemnitee will have the right to
participate in such defense, including appointing separate counsel, but the
costs of such participation shall be borne solely by the Indemnitee. The
Indemnifying Party will, in consultation with the Indemnitee, make all decisions
and determine all actions to be taken with respect to the defense and settlement
of the Third Party Claim; provided, however, that the Indemnifying Party shall
not pay, compromise, settle, or otherwise dispose of such Third Party Claim
without the prior written consent of the Indemnitee (which consent shall not be
unreasonably withheld, conditioned or delayed) unless such settlement involves
only the payment of money, such payment is made in full solely by the
Indemnifying Party without recourse to the Indemnitee, and such settlement does
not impose any obligations or restrictions on the Indemnitee of any nature other
than an obligation to pay monetary damages indemnified hereunder. In no event
will the Indemnifying Party have authority to agree, without the consent of the
Indemnitee, to any relief binding on the Indemnitee other than the payment of
money damages by the Indemnifying Party without recourse to the Indemnitee.
 
(c)                Failure to Assume Defense. If the Indemnifying Party elects
not to defend such Third Party Claim, fails to promptly notify the Indemnitee in
writing of its election to defend, or fails to diligently prosecute the defense
of such Third Party Claim, the Indemnitee may defend such Third Party Claim and
seek indemnification for any and all Indemnifiable

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Losses based upon, arising from or relating to such Third Party Claim; provided,
however, that the Indemnitee shall not pay, compromise, settle, or otherwise
dispose of such Third Party Claim without the prior written consent of the
Indemnifying Party (which consent shall not be unreasonably withheld,
conditioned or delayed).

(d)                Direct Losses. Any claim by an Indemnitee on account of an
Indemnifiable Loss that does not result from a Third Party Claim (a “Direct
Loss”) will be asserted by giving the Indemnifying Party prompt written notice
thereof, (i) describing the nature, facts and circumstances of such
Indemnifiable Loss in reasonable detail, (ii) stating the amount of the
Indemnifiable Loss that has been or may be sustained by the Indemnitee, if
practicable, (iii) stating the method and computation thereof, and (iv)
containing specific reference to the provision or provisions of this Agreement
in respect of which such right of indemnification is claimed or arises. The
Indemnitee shall provide the Indemnifying Party with such other information with
respect to the Direct Loss as the Indemnifying Party may reasonably request and
shall cooperate with the Indemnifying Party and its counsel, including
permitting reasonable access to books, records, and personnel, in connection
with determining the validity of any claim for indemnification by the Indemnitee
and in otherwise resolving such matters. The Indemnifying Party will have a
period of thirty (30) Business Days within which to respond to such claim of a
Direct Loss. If the Indemnifying Party rejects such claim, or does not respond
within such period, the Indemnitee may seek enforcement of its rights to
indemnification under this Agreement.
 
(e)                Delay. A failure to give timely notice as provided in this
Section 9.3 will affect the rights or obligations of a Party hereunder only to
the extent that, as a result of such failure, the Party entitled to receive such
notice was actually prejudiced as a result of such failure. Notwithstanding the
foregoing, no claim for indemnification first made after expiration of the
applicable survival period with respect to the representation, warranty or
covenant on which such claim is based set forth in Section 9.1 will be valid and
any such claim shall be deemed time-barred.
 
(f)                 Tax Losses. In the event of a conflict between Section 7.9
and this Section 9.3, Section 7.9 shall control with respect to Taxes.
 
Section 9.4.          Limitations on Indemnification and Related Matters.
 
(a)                A Party may assert a claim for indemnification hereunder only
to the extent the Indemnitee gives notice of such claim to the Indemnifying
Party in accordance with Section 9.3 prior to the expiration of the Survival
Period.
 
(b)                For the avoidance of doubt, there shall be no time limitation
on claims for indemnification relating to Excluded Liabilities or Assumed
Obligations. Notwithstanding any other provision contained in this Agreement:
 
(i)                 In no event shall either Party be liable for indemnification
pursuant to ‎Section 9.2(a)(i) or ‎Section 9.2(b)(i) hereof (A) for any item or
items arising out of the same facts, events or circumstances where the
Indemnifiable Loss relating thereto is less than $500,000 and (B) in respect of
each individual item where the Indemnifiable Loss

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relating thereto is equal to or greater than $500,000, unless and until the
aggregate of all such Indemnifiable Losses which are incurred or suffered by the
Buyer Indemnitees or Seller Indemnitees, respectively, exceeds two percent (2%)
of the Base Purchase Price (the “Threshold Amount”), in which case the Buyer
Indemnitees or Seller Indemnitees, as applicable, shall be entitled, subject to
‎Section 9.4(b)(ii), to indemnification only for such Indemnifiable Losses in
excess of the Threshold Amount.

(ii)                 Neither Seller nor Buyer shall be required to make payments
for indemnification pursuant to ‎Section 9.2(a)(i), ‎Section 9.2(b)(i) or
Section 7.9(b), respectively, in an aggregate amount in excess of the Base
Purchase Price.
 
(iii)                In no event shall any Indemnifying Party be obligated under
this Article IX to indemnify any Indemnitee entitled to indemnification
hereunder in respect of any Losses that result from the intentional misconduct
of such Indemnitee.
 
(c)                Notwithstanding anything contained in this Agreement to the
contrary, except for the representations and warranties expressly contained in
‎Article V, neither Seller, any of its Affiliates or any Seller Representative,
nor any other Person is making any other express or implied representation or
warranty of any kind or nature whatsoever (including with respect to Seller, the
Business, the Purchased Assets, the Assumed Obligations or the transactions
contemplated by this Agreement), and Seller hereby disclaims any other
representations or warranties, whether made by such Party or its Affiliates,
officers, directors, employees, agents, or representatives, including the
implied warranty of merchantability and any implied warranty of fitness for a
particular purpose.
 
Section 9.5.          Mitigation.
 
(a)                An Indemnitee will use commercially reasonable efforts to
mitigate any Indemnifiable Losses, including commercially reasonable efforts to
recover all Indemnifiable Losses from insurers of such Indemnitee under
applicable insurance policies or through the rate recovery process so as to
reduce the amount of any Indemnifiable Loss hereunder. In the event the
Indemnitee shall fail to use such commercially reasonable efforts, then
notwithstanding anything in this Agreement to the contrary, the Indemnifying
Party shall not be required to indemnify the Indemnitee for that portion of
Indemnifiable Losses that would reasonably have been expected to have been
avoided if the Indemnitee had used such commercially reasonable efforts.
 
(b)               The amount of any Indemnifiable Loss will be reduced to the
extent of any insurance proceeds, rate recovery or other payments actually
received from an insurer or other third party with respect to an Indemnifiable
Loss, net of all costs of recovery. If the amount of any Indemnifiable Loss, at
any time subsequent to the making of an indemnity payment in respect thereof, is
reduced by recovery, settlement, or payment under or pursuant to any insurance
coverage, by rate recovery or by recovery, settlement, or payment by or against
any other Person, the amount of such reduction (net of all costs of recovery),
will be repaid by the Indemnitee to the Indemnifying Party reasonably promptly
following actual receipt or credit of such amounts.

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(c)                The amount of any Indemnifiable Loss will be reduced to the
extent of any net Tax benefit available to the Indemnitee or its Affiliates
arising in connection with the accrual, incurrence or payment of any such
Indemnifiable Loss.
 
(d)                Upon making any indemnity payment, the Indemnifying Party
will, to the extent of such indemnity payment, be subrogated to all rights of
the Indemnitee against any third party in respect of the Indemnifiable Loss to
which the indemnity payment relates.
 
Section 9.6.          Tax Treatment of Indemnity Payments. Seller and Buyer
agree to treat any indemnity payment made pursuant to this Article IX or
pursuant to Section 7.9 as an adjustment to the Purchase Price for federal,
state, local and foreign income Tax purposes, to the extent permitted by Law.
 
Section 9.7.          No Consequential Damages. Notwithstanding anything to the
contrary elsewhere in this Agreement or provided for under any applicable Law,
no Party will be liable to the other Party, either in contract or in tort, for
any consequential, incidental, indirect, special, or punitive damages of the
other Party, including business interruption, loss of future revenue, profits or
income, diminution in value or loss of business reputation or opportunity,
relating to the breach or alleged breach hereof or otherwise, whether or not the
possibility of such damages has been disclosed to the other Party in advance or
could have been reasonably foreseen by such other Party, and, in particular, no
“multiple of profits,” “multiple of cash flow,” “multiple of assets” or similar
valuation methodology shall be used in calculating the amount of any
Indemnifiable Losses. The exclusion of consequential, incidental, indirect,
special, and punitive damages as set forth in the preceding sentence does not
apply to any such damages actually paid to a third parties by Buyer or Seller,
as the case may be, in connection with Losses that may be indemnified pursuant
to this Article IX after Closing.
 
Section 9.8.          Exclusive Remedy. Except for injunctive relief and as
provided in Section 7.2(a), the Parties acknowledge and agree that, from and
after the Closing, the sole and exclusive remedy for any breach or inaccuracy,
or alleged breach or inaccuracy, of any representation or warranty in this
Agreement or any breach or failure to perform, or alleged breach or failure to
perform, any covenant or agreement in this Agreement, or any other claim based
upon, arising out of or relating to this Agreement and/or the transactions
contemplated hereby, will be indemnification in accordance with this Article IX
and Section 7.9 (which shall relate only to Claims related to Taxes). In
furtherance of the foregoing, Seller and Buyer hereby waive, on behalf of
themselves and the other Seller Indemnitees and Buyer Indemnitees, respectively,
to the fullest extent permitted by applicable Law, any and all other rights,
claims, and causes of action (including rights of contribution, rights of
recovery arising out of or relating to any Environmental Laws, claims for breach
of contract, breach of representation or warranty, negligent misrepresentation
and all other claims for breach of duty) that may be based upon, arise out of,
or relate to the Business, the Purchased Assets, the Excluded Assets, the
Assumed Obligations, the Excluded Liabilities, this Agreement, the negotiation,
execution, or performance of this Agreement (including any tort or breach of
contract claim or cause of action based upon, arising out of, or related to any
representation or warranty made in or in connection with this Agreement or as an
inducement to enter into this Agreement), or the transactions contemplated
hereby, known or unknown, foreseen or unforeseen, which exist or may arise in
the future, that it may have against the other arising under or based upon any
Law, common law, or otherwise.

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ARTICLE X 
 
TERMINATION AND OTHER REMEDIES
 
Section 10.1.        Termination.
 
(a)                This Agreement may be terminated at any time prior to the
Effective Date by mutual written consent of Seller and Buyer.
 
(b)                This Agreement may be terminated by Seller or Buyer if the
Closing has not occurred on or before twelve (12) months following the date of
this Agreement (the “Termination Date”); provided, that the right to terminate
this Agreement under this Section 10.1(b) will not be available to a Party whose
failure to fulfill any obligation under this Agreement has been the cause of, or
resulted in, the failure of the Closing to occur on or before the Termination
Date. Notwithstanding the foregoing, if twelve (12) months following the date of
this Agreement the conditions to the Closing set forth in Section 8.1(b), have
not been fulfilled but all other conditions to the Closing have been fulfilled
or are capable of being fulfilled at the Closing, then the Termination Date will
be the day which is fifteen (15) months following the date of this Agreement.
 
(c)                This Agreement may be terminated by either Seller or Buyer if
(i) any Required Regulatory Approval has been denied by the applicable
Governmental Entity, and all appeals of such denial have been taken and have
been unsuccessful, or (ii) one or more courts of competent jurisdiction in the
United States or any State has issued an Order preliminarily, temporarily or
permanently restraining, enjoining, or otherwise prohibiting the Closing, and
such Order has become final and non-appealable; provided, however, that the
right to terminate this Agreement under this Section 10.1(c) shall not be
available to any Party if the denial, restraining, enjoining or other action
described in (i) or (ii) hereof is the result of a failure of such Party to
comply with its obligations pursuant to Section 7.7 or Section 7.8.
 
(d)               This Agreement may be terminated by Buyer by giving written
notice to Seller if there has been a breach by Seller of any representation,
warranty, or covenant made by it in this Agreement which would prevent the
satisfaction of any condition to the obligations of Buyer to effect the Closing
and such breach has not been cured by Seller or waived by Buyer within twenty
(20) Business Days after notice of any such breach; provided, that Buyer shall
not be permitted to terminate this Agreement if Buyer is then in material breach
of any of its representations, warranties, covenants or other agreements
contained herein.
 
(e)                This Agreement may be terminated by Seller by giving written
notice to Buyer if there has been a breach by Buyer of any representation,
warranty, or covenant made by it in this Agreement which would prevent the
satisfaction of any condition to the obligations of Seller to effect the Closing
and such breach has not been cured by Buyer or waived by Seller within twenty
(20) Business Days after notice of any such breach; provided, that Seller shall
not be permitted to terminate this Agreement if Seller is then in material
breach of any of its representations, warranties, covenants or other agreements
contained herein.
 
Section 10.2.        Procedure; Effect of Termination; Termination Fee.

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(a)                In the event that a Party having the right to terminate this
Agreement desires to terminate this Agreement, such Party shall give the other
Party written notice of such termination, specifying the basis for such
termination, and this Agreement will terminate and the transactions contemplated
hereby will be abandoned, without further action by either Party, whereupon the
liabilities of the Parties hereunder will terminate, except as otherwise
expressly provided in this Section 10.2.

(b)                The obligations of the Parties under Article XI, and in
Section 5.16, Section 6.5, Section 7.3, Section 7.6, and Section 7.15 and this
Section 10.2 (and any definitions in Article I referenced in any of the
foregoing) will survive the termination of this Agreement. Nothing herein shall
relieve any Party from liability for any willful and material breach of any
representation, warranty, covenant or agreement of such Party contained in this
Agreement.
 
(c)                If (1) either Buyer or Seller terminates this Agreement
pursuant to Section 10.1(b) and, at the time of such termination, any of the
conditions set forth in Section 8.1(b) shall not have been satisfied, (2) either
Buyer or Seller terminates this Agreement pursuant to Section 10.1(c) (if, and
only if, the applicable denial, restraining, enjoining or other action described
in Section 10.1(c) giving rise to such termination arises in connection with any
Required Regulatory Approval or in connection with the assertion by any other
Governmental Entity that its approval of the transactions contemplated by this
Agreement is required) or (3) Seller terminates this Agreement pursuant to
Section 10.1(e) based on either (x) a failure by Buyer to perform its covenants
or agreements under Section 7.7(a) or Section 7.8, or (y) a failure by Buyer to
close the transactions contemplated hereby when it is otherwise obligated to do
so, then, in any such case, Buyer shall pay to Seller a fee of $80,000,000 in
cash (the “Termination Fee”). Buyer shall pay the Termination Fee to Seller (to
an account designated in writing by Seller) prior to or concurrently with such
termination of this Agreement by Buyer or no later than three (3) Business Days
after the date of the applicable termination by Seller. For the avoidance of
doubt, under no circumstances shall the Seller be entitled to collect the
Termination Fee on more than one occasion and under no circumstances shall the
Seller be permitted to receive both a grant of specific performance of the
obligation to close contemplated by Section 11.12 and collect the Termination
Fee.
 
(d)                Buyer acknowledges that the agreements contained in Section
10.2(c) are an integral part of the transactions contemplated by this Agreement,
and that, without these agreements, Seller would not enter into this Agreement.
If Buyer fails to promptly pay an amount due pursuant to Section 10.2(c) and, in
order to obtain such payment, Seller commences a Claim that results in an Order
against Buyer for the amount set forth in Section 10.2(c) or any portion
thereof, Buyer shall pay to Seller its costs and expenses (including reasonable
attorneys’ fees and the fees and expenses of any expert or consultant engaged by
Seller) in connection with such Claim, together with interest on the amount of
such payment from the date such payment was required to be made until the date
of payment at the U.S. prime rate as quoted by The Wall Street Journal in effect
on the date such payment was required to be made. Any amount payable pursuant to
Section 10.2(c) or Section 10.2(d) shall be paid by Buyer by wire transfer of
same-day funds prior to or on the date such payment is required to be made.
 
(e)                Without limiting the rights of Seller under Section 11.12
prior to the termination of this Agreement pursuant to Section 10.1, if this
Agreement is terminated under

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circumstances in which Buyer is obligated to pay the Termination Fee and, if
applicable, the costs and expenses of Seller pursuant to ‎Section 10.2(d), upon
payment of the Termination Fee and such costs and expenses, Buyer and its
Affiliates shall have no further liability with respect to this Agreement or the
transactions contemplated hereby to Seller, and payment of the Termination Fee
and such costs and expenses by Buyer shall be Seller’s sole and exclusive remedy
for any Claims, losses, liabilities, damages, judgments, inquiries, fines and
reasonable fees, costs and expenses, including attorneys’ fees and
disbursements, suffered or incurred by Seller in connection with this Agreement,
the transactions contemplated hereby (and the termination thereof) or any matter
forming the basis for such termination, and Seller shall not have, and expressly
waives and relinquishes, any other right, remedy or recourse (whether in
contract or in tort or otherwise, or whether at law (including at common law or
by statute) or in equity); provided that, regardless of whether Buyer pays or is
obligated to pay the Termination Fee, nothing in this ‎Section 10.2(e) shall
release Buyer from liability for a Willful Breach of this Agreement. For
purposes of this Agreement, “Willful Breach” means a breach that is a
consequence of a deliberate act or deliberate failure to act undertaken by the
breaching Party with the knowledge that the taking of or failure to take, such
act would, or would reasonably be expected to, cause or constitute a material
breach of any covenants or agreements contained in this Agreement; provided
that, without limiting the meaning of Willful Breach, the Parties acknowledge
and agree that any failure by any Party to consummate the acquisition of the
Purchased Assets, the assumption of the Assumed Obligations and the other
transactions contemplated by this Agreement to be completed at the Closing (the
“Acquisition”) after the applicable conditions to the Closing set forth in
‎Article VIII have been satisfied or waived (except for those conditions that by
their nature are to be satisfied at the Closing, which conditions would be
capable of being satisfied at the time of such failure to consummate the
Acquisition) shall constitute a Willful Breach of this Agreement by such Party.
For the avoidance of doubt, (i) in the event that all applicable conditions to
the Closing set forth in ‎Article VIII have been satisfied or waived (except for
those conditions that by their nature are to be satisfied at the Closing, which
conditions would be capable of being satisfied at the time of such failure to
consummate the Acquisition) but Buyer fails to close for any reason, such
failure to close shall be considered a Willful Breach by the Buyer and (ii) the
availability or unavailability of financing for the transactions contemplated by
this Agreement shall have no effect on Buyer’s obligations hereunder.

(f)                 Upon any termination of this Agreement, all filings,
applications and other submissions made pursuant to this Agreement, to the
extent practicable, will within a commercially reasonable time thereafter be
withdrawn by the filing Party from the Governmental Entity or other Person to
which they were made.
 
ARTICLE XI 
 
MISCELLANEOUS PROVISIONS
 
Section 11.1.        Amendment. This Agreement may be amended, modified, or
supplemented only by written agreement of Seller and Buyer. Notwithstanding
anything to the contrary contained herein, this Section 11.1, Section 11.5,
Section 11.6, Section 11.10, Section 11.11 and Section 11.15 may not be amended,
supplemented, waived or otherwise modified in a

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manner adverse to the Financing Sources without the prior written consent of the
Financing Sources.

Section 11.2.       Waivers and Consents. Except as otherwise provided in this
Agreement, any failure of either Party to comply with any obligation, covenant,
agreement, or condition herein may be waived by the Party entitled to the
benefits thereof only by a written instrument signed by the Party granting such
waiver, but such waiver or failure to insist upon strict compliance with such
obligation, covenant, agreement, or condition will not operate as a waiver of,
or estoppel with respect to, any subsequent or other failure.
 
Section 11.3.        Notices. All notices and other communications hereunder
will be in writing and will be deemed given (i) when received, if delivered
personally, (ii) when sent, if sent by facsimile transmission (provided, that
the sender receives confirmation of successful transmission) or by electronic
mail, or (iii) when received, if mailed by overnight courier or certified mail
(return receipt requested), postage prepaid, in each case, to the Party being
notified at such Party’s address indicated below (or at such other address for a
Party as is specified by like notice):
 
(a)                If to Seller, to:
 
Pivotal Utility Holdings, Inc.
10 Peachtree Place NE
Atlanta, GA 30309
Attention: Elizabeth W. Reese, Executive Vice President, Chief Financial Officer
and Treasurer
Facsimile: (404) 584-3459
Email: ewreese@southernco.com
 
with copies (which shall not constitute notice) to:
 
Pivotal Utility Holdings, Inc.
10 Peachtree Place NE
Atlanta, GA 30309
Attention: Paul R. Shlanta, Senior Vice President and General Counsel
Facsimile: (404) 584-3459
Email: pshlanta@southernco.com
 
and
 
Baker Botts LLP
30 Rockefeller Plaza
New York, New York 10112
Attention: William S. Lamb
Facsimile: (212) 259-2557
Email: bill.lamb@bakerbotts.com

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(b)                if to Buyer, to:
 
South Jersey Industries, Inc.
1 South Jersey Plaza
Folsom, NJ 08037
Attention: Steven R. Cocchi
E-mail: scocchi@sjindustries.com
 
with a copy (which shall not constitute notice) to:
 
Gibson, Dunn & Crutcher LLP
200 Park Avenue
New York, NY 10166-0193
Attention:   Barbara Becker
Saee Muzumdar
E-mail:         bbecker@gibsondunn.com
smuzumdar@gibsondunn.com
 
Section 11.4.       Assignment. This Agreement and all of the provisions hereof
will be binding upon and inure to the benefit of the Parties and their
respective successors and permitted assigns, but neither this Agreement nor any
of the rights, interests, or obligations hereunder may be assigned by either
Party, without the prior written consent of the other Party. Notwithstanding the
foregoing, Buyer shall be permitted to assign its rights and obligations under
this Agreement and any other Ancillary Agreement, individually or collectively,
to one or more wholly-owned, direct or indirect subsidiaries with prior written
notice to Seller; provided, however, that no such assignment shall relieve Buyer
of, or constitute a discharge of, any of Buyer’s liabilities and obligations
under this Agreement.
 
Section 11.5.        No Third Party Beneficiaries. No provision of this
Agreement is intended to or shall be deemed to confer any rights or remedies
upon any Person other than the Parties, except for the rights of Affiliates of
the Parties under Article IX hereof; provided, that the Financing Sources shall
be express third-party beneficiaries of this Section 11.5 and Section 11.1,
Section 11.6, Section 11.10, Section 11.11 and Section 11.15 and each of such
Sections shall expressly inure to the benefit of the Financing Sources and the
Financing Sources shall be entitled to rely on and enforce the provisions of
such Sections. Without limiting the foregoing, no provision of this Agreement
creates any rights in any employee or former employee of Seller (including any
beneficiary or dependent thereof) in respect of continued employment or resumed
employment, and no provision of this Agreement creates any rights in any such
Persons in respect of any benefits that may be provided, directly or indirectly,
under any employee benefit plan or arrangement.
 
Section 11.6.        Governing Law. This Agreement (as well as any claim or
controversy arising out of or relating to this Agreement or the transactions
contemplated hereby) shall be governed by and construed in accordance with the
laws of the State of New York, without regard to the conflicts of laws rules
thereof that would otherwise require the laws of another jurisdiction to apply.

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Section 11.7.       Severability. Any term or provision of this Agreement that
is invalid or unenforceable in any situation in any jurisdiction will not affect
the validity or enforceability of the remaining terms and provisions hereof or
the validity or enforceability of the offending term or provision in any other
situation or in any other jurisdiction.
 
Section 11.8.       Entire Agreement. This Agreement will be a valid and binding
agreement of the Parties only if and when it is fully executed and delivered by
the Parties, and until such execution and delivery no legal obligation will be
created by virtue hereof. This Agreement, the Confidentiality Agreement and the
Ancillary Agreements, together with the Appendices and Exhibits hereto and
thereto and the certificates and instruments delivered hereunder or in
accordance herewith, embodies the entire agreement and understanding of the
Parties hereto in respect of the transactions contemplated by this Agreement.
This Agreement, the Confidentiality Agreement and the Ancillary Agreements
supersede all prior agreements and understandings between the Parties with
respect to such transactions contemplated hereby. Neither this Agreement, the
Confidentiality Agreement nor any Ancillary Agreement shall be deemed to contain
or imply any restriction, covenant, representation, warranty, agreement or
undertaking of any party with respect to the transactions contemplated hereby or
thereby other than those expressly set forth herein or therein or in any
document required to be delivered hereunder or thereunder.
 
Section 11.9.        Delivery. This Agreement, and any certificates and
instruments delivered hereunder or in accordance herewith, may be executed in
multiple counterparts (each of which will be deemed an original, but all of
which together will constitute one and the same instrument). Signatures to this
Agreement transmitted by facsimile transmission, by electronic mail in “portable
document format” (.pdf) form, or by any other electronic means intended to
preserve the original graphic and pictorial appearance of a document, will have
the same effect as physical delivery of the paper document bearing the original
signature.
 
Section 11.10.     Waiver of Jury Trial. EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY AND ALL RIGHT TO
TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATED TO THIS
AGREEMENT, THE FINANCING OR THE ANCILLARY AGREEMENTS OR ANY OF THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY (INCLUDING ANY LEGAL PROCEEDING AGAINST ANY
FINANCING SOURCE).
 
Section 11.11.      Submission to Jurisdiction. Each of the parties irrevocably
agrees that any legal action or proceeding arising out of or relating to this
Agreement brought by the other party or its successors or assigns shall be
brought and determined in any New York State or federal court sitting in the
City of New York (or, if such court lacks subject matter jurisdiction, in any
appropriate New York or federal court), and each of the parties hereby
irrevocably submits to the exclusive jurisdiction of the aforesaid courts for
itself and with respect to its property, generally and unconditionally, with
regard to any such action or proceeding arising out of or relating to this
Agreement and the transactions contemplated hereby. Each of the parties agrees
not to commence any action, suit or proceeding relating thereto except in the
courts described above in New York, other than actions in any court of competent
jurisdiction to enforce any judgment, decree or award rendered by any such court
in New York as described

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herein. Each of the parties further agrees that notice as provided herein shall
constitute sufficient service of process and the parties further waive any
argument that such service is insufficient. Each of the parties hereby
irrevocably and unconditionally waives, and agrees not to assert, by way of
motion or as a defense, counterclaim or otherwise, in any action or proceeding
arising out of or relating to this Agreement or the transactions contemplated
hereby, (a) any claim that it is not personally subject to the jurisdiction of
the courts in New York as described herein for any reason, (b) that it or its
property is exempt or immune from jurisdiction of any such court or from any
legal process commenced in such courts (whether through service of notice,
attachment prior to judgment, attachment in aid of execution of judgment,
execution of judgment or otherwise) and (c) that (i) the suit, action or
proceeding in any such court is brought in an inconvenient forum, (ii) the venue
of such suit, action or proceeding is improper or (iii) this Agreement, or the
subject matter hereof, may not be enforced in or by such courts.

Section 11.12.      Specific Performance. The parties agree that irreparable
damage would occur in the event that any of the provisions of this Agreement
were not performed in accordance with their specific terms or were otherwise
breached. Accordingly, each of the parties shall be entitled to specific
performance of the terms hereof, including an injunction or injunctions to
prevent breaches of this Agreement and to enforce specifically the terms and
provisions of this Agreement in any New York State or federal court sitting in
the City of New York (or, if such court lacks subject matter jurisdiction, in
any appropriate New York State or federal court), this being in addition to any
other remedy to which they are entitled at law or in equity. Each of the parties
hereby further waives (a) any defense in any action for specific performance
that a remedy at law would be adequate and (b) any requirement under any law to
post security as a prerequisite to obtaining equitable relief.
 
Section 11.13.     Disclosure Generally. Notwithstanding anything to the
contrary contained in the Seller Disclosure Schedules or in this Agreement, the
information and disclosures contained in any Seller Disclosure Schedule shall be
deemed to be disclosed and incorporated by reference with respect to any other
representation or warranty of Seller for which applicability of such information
and disclosure is reasonably apparent on its face. The fact that any item of
information is disclosed in any Seller Disclosure Schedule shall not be
construed to mean that such information is required to be disclosed by this
Agreement. Such information and the dollar thresholds set forth herein shall not
be used as a basis for interpreting the terms “material” or “Material Adverse
Effect” or other similar terms in this Agreement.
 
Section 11.14.      “As Is” Sale; Release.
 
(a)                EXCEPT FOR THOSE EXPRESS REPRESENTATIONS AND WARRANTIES
CONTAINED IN Article V, AND EXCEPT FOR THOSE ITEMS FOR WHICH BUYER IS EXPRESSLY
INDEMNIFIED PURSUANT TO Section 9.2(a)(ii), (i) THE Business is BEING
TRANSFERRED “AS IS, WHERE IS, WITH ALL FAULTS,” AND (ii) BUYER ACKNOWLEDGES THAT
IT HAS NOT RELIED ON, AND SELLERS EXPRESSLY DISCLAIM, ANY REPRESENTATIONS OR
WARRANTIES OF ANY KIND OR NATURE, EXPRESS OR IMPLIED, AS TO THE CONDITION, VALUE
OR QUALITY OF BUSINESS OR THE PURCHASED ASSETS OR THE PROSPECTS (FINANCIAL OR
OTHERWISE), RISKS AND OTHER INCIDENTS OF THE BUSINESS OR THE PURCHASED ASSETS.

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(b)               Except for the obligations of Seller under this Agreement, for
and in consideration of the transfer of the Business, the Purchased Assets and
the Assumed Obligations, effective as of the Closing, Buyer shall and shall
cause its Affiliates to absolutely and unconditionally release, acquit and
forever discharge Seller and its Affiliates, each of their present and former
officers, directors, managers, employees and agents and each of their respective
heirs, executors, administrators, successors and assigns, from any and all
costs, expenses, damages, debts, or any other obligations, liabilities and
claims whatsoever, whether known or unknown, both in law and in equity, in each
case to the extent arising out of or resulting from the ownership and/or
operation of the Business, the Purchased Assets or the Assumed Obligations, or
the assets, business, operations, conduct, services, products and/or employees
(including former employees) of any of the Business (and any predecessors),
whether related to any period of time before or after the Effective Date
including, without limitation, as to liabilities under any Environmental Law;
provided, however, in the event Buyer is sued by Seller or its Affiliates for
any matter subject to this release, Buyer shall have the right to raise any
defenses or counterclaims in connection with such lawsuits.
 
Section 11.15.     Liability of Financing Sources. Notwithstanding anything to
the contrary contained herein, none of the Financing Sources shall have any
liability to Seller or its Affiliates relating to or arising out of this
Agreement, the Financing or the transactions contemplated by this Agreement,
whether at law or equity, in contract, in tort or otherwise, and neither Seller
nor any of its Affiliates will have any rights or claims against any Financing
Sources under this Agreement and any other agreement contemplated by, or entered
into in connection with, the Financing, including any commitments by the
Financing Sources in respect of the Financing. Notwithstanding anything herein
to the contrary, in no event shall Seller or its Affiliates be entitled to seek
the remedy of specific performance of this Agreement against any of the
Financing Sources.
 
[Signature Page Follows]

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IN WITNESS WHEREOF, Seller and Buyer have executed this Agreement or caused this
Agreement to be executed by their respective officers thereunto duly authorized
as of the date first written above.
 
 
PIVOTAL UTILITY Holdings, Inc., as Seller
 
 
 
 
By:
/s/ Elizabeth W. Reese
 
Name:
Elizabeth W. Reese
 
Title:
Executive Vice President and Chief Financial Officer
 
 
 
 
SOUTH JERSEY INDUSTRIES, INC., as Buyer
 
 
 
 
By:
/s/ Michael J. Renna
 
Name:
Michael J. Renna
 
Title:
Chief Executive Officer

 
 
 
 
 
 
 
 
 

 
 
 
 
 
 
 
 
 
 
 
[Signature Page to Asset Purchase Agreement]

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Exhibit A
 
Form of Assignment of Easements

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Exhibit B
 
Form of Assignment of Leases

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Exhibit C
 
Form of Bill of Sale, Assignment and Assumption Agreement

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Exhibit D
 
Form of Deeds