Exhibit 10.4

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ROANOKE GAS COMPANY

$29,500,000

PRIVATE SHELF FACILITY

______________

PRIVATE SHELF AGREEMENT

______________

DATED SEPTEMBER 30, 2015

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CHI 66084385v10

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Execution Version

TABLE OF CONTENTS
 
 
 
 
 
Section
 
 
Heading
Page
 
 
 
 
 
Section 1.
 
Authorization of Notes
                  1
 
 
 
 
 
Section 2.
 
Sale and Purchase of Notes
                  2
 
 
 
 
 
Section 3.
 
Closing
                  6
 
Section 3.1.
 
Facility Closings
                  6
 
Section 3.2.
 
Rescheduled Facility Closings
                  6
 
 
 
 
 
Section 4.
 
Conditions to Closing
                  7
 
Section 4.1.
 
Representations and Warranties
                  7
 
Section 4.2.
 
Performance; No Default
                  7
 
Section 4.3.
 
Compliance Certificates
                  7
 
Section 4.4.
 
Opinions of Counsel
                  8
 
Section 4.5.
 
Purchase Permitted By Applicable Law, Etc
                  8
 
Section 4.6.
 
Sale of Other Notes
                  8
 
Section 4.7.
 
Payment of Fees
                  8
 
Section 4.8.
 
Private Placement Number
                  9
 
Section 4.9.
 
Changes in Corporate Structure
                  9
 
Section 4.10.
 
Proceedings and Documents
                  9
 
Section 4.11.
 
Parent Guaranty
                  9
 
Section 4.12.
 
Commission Approval
                  9
 
Section 4.13.
 
Certain Documents
                  9
 
 
 
 
 
Section 5.
 
Representations and Warranties of the Company
                10
 
Section 5.1.
 
Organization; Power and Authority
                10
 
Section 5.2.
 
Authorization, Etc
                10
 
Section 5.3.
 
Disclosure
                10
 
Section 5.4.
 
Organization and Ownership of Shares of Subsidiaries; Affiliates
                11
 
Section 5.5.
 
Financial Statements; Material Liabilities
                11
 
Section 5.6.
 
Compliance with Laws, Other Instruments, Etc
                12
 
Section 5.7.
 
Governmental Authorizations, Etc
                12
 
Section 5.8.
 
Litigation; Observance of Agreements, Statutes and Orders
                12
 
Section 5.9.
 
Taxes
                13
 
Section 5.10.
 
Title to Property; Leases
                13
 
Section 5.11.
 
Licenses, Permits, Etc
                13
 
Section 5.12.
 
Compliance with ERISA
                14

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Execution Version

 
Section 5.13.
 
Private Offering by the Company
                14
 
Section 5.14.
 
Use of Proceeds; Margin Regulations
                15
 
Section 5.15.
 
Existing Indebtedness; Future Liens
                15
 
Section 5.16.
 
Foreign Assets Control Regulations, Etc
                16
 
Section 5.17.
 
Status under Certain Statutes
                17
 
Section 5.18.
 
Environmental Matters
                17
 
Section 5.19.
 
Hostile Tender Offers
                18
 
 
 
 
 
Section 6.
 
Representations of the Purchasers
                18
 
Section 6.1.
 
Purchase for Investment
                18
 
Section 6.2.
 
Source of Funds
                18
 
 
 
 
 
Section 7.
 
Information as to Company
                20
 
Section 7.1.
 
Financial and Business Information
                20
 
Section 7.2.
 
Officer’s Certificate
                24
 
Section 7.3.
 
Visitation
                24
 
Section 7.4.
 
Electronic Delivery
                25
 
 
 
 
 
Section 8.
 
Payment and Prepayment of the Notes
                26
 
Section 8.1.
 
Required Prepayments
                26
 
Section 8.2.
 
Optional Prepayments with Make-Whole Amount
                26
 
Section 8.3.
 
Allocation of Partial Prepayments
                27
 
Section 8.4.
 
Maturity; Surrender, Etc
                27
 
Section 8.5.
 
Purchase of Notes
                27
 
Section 8.6.
 
Make-Whole Amount
                27
 
Section 8.7.
 
Prepayment in Connection with an Asset Disposition.
                28
 
Section 8.8.
 
Prepayment in Connection with a Put Right for Other Indebtedness.
                29
 
Section 8.9.
 
Payments Due on Non-Business Days.
                30
 
 
 
 
 
Section 9.
 
Affirmative Covenants
                30
 
Section 9.1.
 
Compliance with Laws
                30
 
Section 9.2.
 
Insurance
                31
 
Section 9.3.
 
Maintenance of Properties
                31
 
Section 9.4.
 
Payment of Taxes and Claims
                31
 
Section 9.5.
 
Corporate Existence, Etc
                31
 
Section 9.6.
 
Books and Records
                32
 
Section 9.7.
 
Subsidiary Guarantors
                32
 
 
 
 
 
Section 10.
 
Negative Covenants
                33
 
Section 10.1.
 
Transactions with Affiliates
                33
 
Section 10.2.
 
Merger, Consolidation, Etc
                33
 
Section 10.3.
 
Line of Business
                34

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Execution Version

 
Section 10.4.
 
Terrorism Sanctions Regulations
                34
 
Section 10.5.
 
Liens
                34
 
Section 10.6.
 
Financial Covenants
                36
 
Section 10.7.
 
Sale of Assets, Etc
                36
 
 
 
 
 
Section 11.
 
Events of Default
                37
 
 
 
 
 
Section 12.
 
Remedies on Default, Etc
                39
 
Section 12.1.
 
Acceleration
                39
 
Section 12.2.
 
Other Remedies
                40
 
Section 12.3.
 
Rescission
                40
 
Section 12.4.
 
No Waivers or Election of Remedies, Expenses, Etc
                40
 
 
 
 
 
Section 13.
 
Registration; Exchange; Substitution of Notes
                40
 
Section 13.1.
 
Registration of Notes
                40
 
Section 13.2.
 
Transfer and Exchange of Notes
                41
 
Section 13.3.
 
Replacement of Notes
                41
 
 
 
 
 
Section 14.
 
Payments on Notes
                42
 
 
 
 
 
Section 15.
 
Expenses, Etc
                42
 
Section 15.1.
 
Transaction Expenses
                42
 
Section 15.2.
 
Survival
                43
 
 
 
 
 
Section 16.
 
Survival of Representations and Warranties; Entire Agreement
                43
 
 
 
 
 
Section 17.
 
Amendment and Waiver
                43
 
Section 17.1.
 
Requirements
                43
 
Section 17.2.
 
Solicitation of Holders of Notes
                44
 
Section 17.3.
 
Binding Effect, etc
                44
 
Section 17.4.
 
Notes Held by Company, etc
                45
 
 
 
 
 
Section 18.
 
Notices
                45
 
 
 
 
 
Section 19.
 
Reproduction of Documents
                46
 
 
 
 
 
Section 20.
 
Confidential Information
                46
 
 
 
 
 
Section 21.
 
Substitution of Purchaser
                48
 
 
 
 
 
Section 22.
 
Miscellaneous
                48
 
Section 22.1.
 
Successors and Assigns
                48
 
Section 22.2.
 
Accounting Terms
                48

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Execution Version

 
Section 22.3.
 
Severability
                48
 
Section 22.4.
 
Construction, etc
                49
 
Section 22.5.
 
Counterparts
                49
 
Section 22.6.
 
Governing Law
                49
 
Section 22.7.
 
Jurisdiction and Process; Waiver of Jury Trial
                49
 
Section 22.8.
 
Transaction References
                50
 
 
 
 
 
Signature
 
 
 
                51

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Execution Version

SCHEDULE A
—

DEFINED TERMS
SCHEDULE B
—

AUTHORIZED OFFICERS
SCHEDULE 1
—

FORM OF SHELF NOTE
SCHEDULE 2(d)
—

FORM OF REQUEST FOR PURCHASE
SCHEDULE 2(f)
—

FORM OF CONFIRMATION OF ACCEPTANCE
SCHEDULE 4.4(a) —
—

FORM OF OPINION OF SPECIAL COUNSEL FOR THE COMPANY
SCHEDULE 4.4(b) —
—

FORM OF OPINION OF SPECIAL COUNSEL FOR THE PURCHASERS
SCHEDULE 5.3
—

DISCLOSURE MATERIALS
SCHEDULE 5.4
—

SUBSIDIARIES OF THE COMPANY AND OWNERSHIP OF SUBSIDIARY STOCK
SCHEDULE 5.5
—

FINANCIAL STATEMENTS
SCHEDULE 5.15
—

EXISTING INDEBTEDNESS

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Execution Version

ROANOKE GAS COMPANY
519 Kimball Avenue
Roanoke, Virginia 24016

$29,500,000 Private Shelf Facility

Dated as of September 30, 2015

To Prudential Investment Management, Inc.
(“Prudential”)
To each Prudential Affiliate which becomes
bound by this Agreement as hereinafter
provided (each, a “Purchaser” and
collectively, the “Purchasers”):
Ladies and Gentlemen:
Roanoke Gas Company, a Virginia corporation (together with any successor thereto
that becomes a party hereto pursuant to Section 10.2, the “Company”), agrees
with each of the Purchasers as follows:
Section 1.Authorization of Notes.
The Company may from time to time authorize the issue and sale of its senior
promissory notes (the “Shelf Notes”, such term to include any such notes issued
in substitution thereof pursuant to Section 13) in the aggregate amount up to
$29,500,000, to be dated the date of issue thereof, to mature, in the case of
each Shelf Note so issued, no more than 20 years after the date of original
issuance thereof, to have an average life, in the case of each Shelf Note so
issued, of no more than 20 years after the date of original issuance thereof, to
bear interest on the unpaid balance thereof from the date thereof at the rate
per annum, and to have such other particular terms, as shall be set forth, in
the case of each Shelf Note so issued, in the Confirmation of Acceptance with
respect to such Shelf Note delivered pursuant to Section 2(f). Any such Shelf
Note shall be substantially in the form of Schedule 1 attached hereto. The terms
“Note” and “Notes” as used herein shall include each Shelf Note delivered
pursuant to any provision of this Agreement and each Note delivered in
substitution or exchange for any such Shelf Note pursuant to any such provision.
Notes which have (a) the same final maturity, (b) the same principal prepayment
dates, (c) the same principal prepayment amounts (as a percentage of the
original principal amount of each Note), (d) the same interest rate, (e) the
same interest payment periods and (f) the same date of issuance (which, in the
case of a Note issued in exchange for another Note, shall be deemed for these
purposes the date on which such Note’s ultimate predecessor Note was issued),
are herein called a “Series” of Notes. Certain capitalized and other terms used
in this Agreement are defined in Schedule A. References

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Roanoke Gas Company        Private Shelf Agreement

to a “Schedule” are references to a Schedule attached to this Agreement unless
otherwise specified. References to a “Section” are references to a Section of
this Agreement unless otherwise specified.
The payment and performance by the Company of its covenants and agreements
hereunder and under the Notes are unconditionally guaranteed by the Parent
Guarantor pursuant to the Parent Guaranty.
Section 2.    Sale and Purchase of Notes.
(a)    Facility. Prudential is willing to consider, in its sole discretion and
within limits which may be authorized for purchase by Prudential Affiliates from
time to time, the purchase of Shelf Notes pursuant to this Agreement. The
willingness of Prudential to consider such purchase of Shelf Notes is herein
called the “Facility.” At any time, the aggregate principal amount of Shelf
Notes stated in Section 1, minus the aggregate principal amount of Shelf Notes
purchased and sold pursuant to this Agreement prior to such time, minus the
aggregate principal amount of Accepted Notes (as hereinafter defined) which have
not yet been purchased and sold hereunder prior to such time, is herein called
the “Available Facility Amount” at such time. NOTWITHSTANDING THE WILLINGNESS OF
PRUDENTIAL TO CONSIDER PURCHASES OF SHELF NOTES BY PRUDENTIAL AFFILIATES, THIS
AGREEMENT IS ENTERED INTO ON THE EXPRESS UNDERSTANDING THAT NEITHER PRUDENTIAL
NOR ANY PRUDENTIAL AFFILIATE SHALL BE OBLIGATED TO MAKE OR ACCEPT OFFERS TO
PURCHASE SHELF NOTES, OR TO QUOTE RATES, SPREADS OR OTHER TERMS WITH RESPECT TO
SPECIFIC PURCHASES OF SHELF NOTES, AND THE FACILITY SHALL IN NO WAY BE CONSTRUED
AS A COMMITMENT BY PRUDENTIAL OR ANY PRUDENTIAL AFFILIATE.

(b)    Issuance Period. Notes may be issued and sold pursuant to this Agreement
until the earlier of (i) the third anniversary of the date of this Agreement (or
if such anniversary date is not a Business Day, the Business Day next preceding
such anniversary) and (ii) the thirtieth day after Prudential shall have given
to the Company, or the Company shall have given to Prudential, a written notice
stating that it elects to terminate the issuance and sale of Shelf Notes
pursuant to this Agreement (or if such thirtieth day is not a Business Day, the
Business Day next preceding such thirtieth day). The period during which Shelf
Notes may be issued and sold pursuant to this Agreement is herein called the
“Issuance Period.”
(c)    Periodic Spread Information. Provided no Default or Event of Default
exists, not later than 9:30 A.M. (New York City local time) on a Business Day
during the Issuance Period if there is an Available Facility Amount on such
Business Day, the Company may request by e-mail (with confirmation of receipt),
telefacsimile or telephone, and Prudential will, to the extent reasonably
practicable, provide to the Company on such Business Day (or, if such request is
received after 9:30 A.M. (New York City local time) on such Business Day, on the
following Business Day), information (by e-mail (with confirmation of receipt),
telefacsimile or telephone) with respect to various spreads at which Prudential
Affiliates might be interested in purchasing Shelf Notes of different average
lives; provided, however, that the Company may not make such requests more
frequently than once in every five (5) Business Days or such other period as
shall be mutually agreed to by the Company and Prudential. The amount and
content of information so provided shall be in

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Roanoke Gas Company        Private Shelf Agreement

the sole discretion of Prudential but it is the intent of Prudential to provide
information which will be of use to the Company in determining whether to
initiate procedures for use of the Facility. Information so provided shall not
constitute an offer to purchase Shelf Notes, and neither Prudential nor any
Prudential Affiliate shall be obligated to purchase Shelf Notes at the spreads
specified. Information so provided shall be representative of potential interest
only for the period commencing on the day such information is provided and
ending on the earlier of (i) the fifth (5th) Business Day after such day and
(ii) the first (1st) Business Day after any day on which further spread
information is provided to the Company. Prudential may suspend or terminate its
obligation to provide information pursuant to this Section 2(c) for any reason,
including its determination that the credit quality of the Company has declined
since the date of this Agreement.
(d)    Request for Purchase. The Company may from time to time during the
Issuance Period make requests for purchases of Shelf Notes (each such request
being a “Request for Purchase”). Each Request for Purchase shall be made to
Prudential by e-mail (with confirmation of receipt), telefacsimile or overnight
delivery service, and shall (i) specify the aggregate principal amount of Shelf
Notes covered thereby, which shall not be (A) less than $3,000,000 or (B)
greater than the Available Facility Amount at the time such Request for Purchase
is made, (ii) specify the principal amounts, final maturities, principal
prepayment dates and amounts and interest payment periods (quarterly or
semi-annually in arrears) of the Shelf Notes covered thereby, (iii) specify the
use of proceeds of such Shelf Notes, (iv) specify the proposed day for the
Closing of the purchase and sale of such Shelf Notes, which shall be a Business
Day during the Issuance Period not less than ten (10) days and not more than 25
Business Days after the making of such Request for Purchase, (v) specify the
number of the account and the name and address of the depository institution to
which the purchase prices of such Shelf Notes are to be transferred on the
related Closing for such purchase and sale, (vi) certify that (x) the
representations and warranties contained in Section 5 (which may be updated
and/or modified and delivered with such Request for Purchase as contemplated by
Section 4.1 hereof) are true as of the date of such Request for Purchase and (y)
there exists on the date of such Request for Purchase no Event of Default or
Default and (vii) be substantially in the form of Schedule 2(d) attached hereto.
Each Request for Purchase shall be in writing signed by the Company and shall be
deemed made when received by Prudential. Any previous notification referenced in
a Request for Purchase or any Request for Purchase that contains information
that purports to amend the information contained in any Section or Schedule
hereto, shall not be effective to amend such information unless it is received
by Prudential at least two Business Days prior to the Acceptance Day for Notes
to which such Request for Purchase relates; provided, however, Prudential agrees
that all new disclosures related to outstanding Indebtedness under Schedule 5.15
will be deemed acceptable when such Request for Purchase is delivered if such
Indebtedness is permitted under this Agreement and under applicable law. If
Prudential provides such interest rate quotes earlier than two Business Days
after Prudential receives a Request for Purchase which contains information that
purports to amend the information contained in any Schedule or Section hereto
and Prudential states in writing that it waives the requirement in this Section
2(d) that the information shall not be effective to amend unless it is received
by Prudential at least two Business Days prior to the Acceptance Day, the
information contained in such Schedule or Section shall be deemed effective to
amend such information at the time of the issuances of the quotes.

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Roanoke Gas Company        Private Shelf Agreement

(e)    Rate Quotes. Not later than five (5) Business Days or, in the event the
Company has attached a material modification to any representation or warranty
to a Request for Purchase pursuant to Section 4.1, not later than ten (10)
Business Days, after the Company shall have given Prudential a Request for
Purchase pursuant to Section 2(d), Prudential may, but shall be under no
obligation to, provide to the Company by e-mail (with confirmation of receipt),
telephone or telefacsimile, in each case between 9:30 A.M. and 1:30 P.M. (New
York City local time) (or such later time as Prudential may elect) (i) interest
rate quotes for the several principal amounts, maturities, principal prepayment
schedules, and interest payment periods of Shelf Notes specified in such Request
for Purchase and (ii) the Acceptance Window designated by Prudential with
respect to such interest rate quote. Each quote shall represent the interest
rate per annum payable on the outstanding principal balance of such Shelf Notes
at which a Prudential Affiliate would be willing to purchase such Shelf Notes at
100% of the principal amount thereof.
(f)    Acceptance. Within the Acceptance Window with respect to any interest
rate quotes provided pursuant to Section 2(e), the Company may, subject to
Section 2(g), elect to accept such interest rate quotes as to not less than
$3,000,000 aggregate principal amount of the Shelf Notes specified in the
related Request for Purchase. Such election shall be made by an Authorized
Officer of the Company notifying Prudential by telephone or telefacsimile within
the Acceptance Window that the Company elects to accept such interest rate
quotes, specifying the Shelf Notes (each such Shelf Note being an “Accepted
Note”) as to which such acceptance (an “Acceptance”) relates. The day the
Company notifies Prudential of an Acceptance with respect to any Accepted Notes
is herein called the “Acceptance Day” for such Accepted Notes. Any interest rate
quotes as to which Prudential does not receive an Acceptance within the
Acceptance Window shall expire, and no purchase or sale of Shelf Notes hereunder
shall be made based on such expired interest rate quotes. Subject to Section
2(g) and the other terms and conditions hereof, the Company agrees to sell to a
Prudential Affiliate, and Prudential agrees to cause the purchase by a
Prudential Affiliate of, the Accepted Notes at 100% of the principal amount of
such Shelf Notes. As soon as practicable following the Acceptance Day, the
Company, Prudential and each Prudential Affiliate which is to purchase any such
Accepted Notes will execute a confirmation of such Acceptance substantially in
the form of Schedule 2(f) attached hereto (a “Confirmation of Acceptance”). If
the Company should fail to execute and return to Prudential within three (3)
Business Days following the Company’s receipt thereof a Confirmation of
Acceptance with respect to any Accepted Notes, Prudential may at its election at
any time prior to Prudential’s receipt thereof cancel the closing with respect
to such Accepted Notes by so notifying the Company in writing.
(g)    Market Disruption. Notwithstanding the provisions of Section 2(f), if
Prudential shall have provided interest rate quotes pursuant to Section 2(e) and
thereafter prior to the time Prudential is notified of an Acceptance with
respect to such quotes in accordance with Section 2(f) the domestic market for
U.S. Treasury securities or derivatives shall have closed or there shall have
occurred a general suspension, material limitation, or significant disruption of
trading in securities generally on the New York Stock Exchange or in the
domestic market for U.S. Treasury securities or derivatives, then such interest
rate quotes shall expire, and no purchase or sale of Shelf Notes hereunder shall
be made based on such expired interest rate quotes. If the Company thereafter
notifies Prudential of the Acceptance of any such interest rate quotes, such
Acceptance shall be

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Roanoke Gas Company        Private Shelf Agreement

ineffective for all purposes of this Agreement, and Prudential shall promptly
notify the Company that the provisions of this Section 2(g) are applicable with
respect to such Acceptance.
(h)    Fees.
(i)    Structuring Fee. In consideration for the time, effort and expense
involved in the preparation, negotiation and execution of this Agreement, at the
time of the execution and delivery of this Agreement by the Company and
Prudential, the Company will pay to Prudential in immediately available funds a
fee (the “Structuring Fee”) in the amount of $15,000.00.
(ii)    Issuance Fee. The Company will pay to each Purchaser in immediately
available funds a fee (the “Issuance Fee”) on each Closing Day (other than any
Closing occurring within 60 days of the date hereof) in an amount equal to
0.125% of the aggregate principal amount of Notes sold to such Purchaser on such
Closing Day.
(iii)    Delayed Delivery Fee. If the closing of the purchase and sale of any
Accepted Note is delayed for any reason beyond the original Closing Day for such
Accepted Note, the Company will pay to each Purchaser which shall have agreed to
purchase such Accepted Note on the Cancellation Date or actual closing date of
such purchase and sale a fee (the “Delayed Delivery Fee”) calculated as follows:
(BEY - MMY) X DTS/360 X PA
where “BEY” means Bond Equivalent Yield, i.e., the bond equivalent yield per
annum of such Accepted Note; “MMY” means Money Market Yield, i.e., the yield per
annum on a commercial paper investment of the highest quality selected by
Prudential on the date Prudential receives notice of the delay in the closing
for such Accepted Note having a maturity date or dates the same as, or closest
to, the Rescheduled Closing Day or Rescheduled Closing Days for such Accepted
Note (a new alternative investment being selected by Prudential each time such
closing is delayed); “DTS” means Days to Settlement, i.e., the number of actual
days elapsed from and including the original Closing Day with respect to such
Accepted Note (in the case of the first such payment with respect to such
Accepted Note) or from and including the date of the next preceding payment (in
the case of any subsequent delayed delivery fee payment with respect to such
Accepted Note) to but excluding the date of such payment; and “PA” means
Principal Amount, i.e., the principal amount of the Accepted Note for which such
calculation is being made. In no case shall the Delayed Delivery Fee be less
than zero. Nothing contained herein shall obligate any Purchaser to purchase any
Accepted Note on any day other than the Closing Day for such Accepted Note, as
the same may be rescheduled from time to time in compliance with Section 3.2.
(iv)    Cancellation Fee. If the Company at any time notifies Prudential in
writing that the Company is canceling the closing of the purchase and sale of
any Accepted Note, or if Prudential notifies the Company in writing under the
circumstances set forth in the last sentence of Section 2(f) or the penultimate
sentence of Section 3.2 that the closing of the

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Roanoke Gas Company        Private Shelf Agreement

purchase and sale of such Accepted Note is to be canceled, or if the closing of
the purchase and sale of such Accepted Note is not consummated on or prior to
the last day of the Issuance Period (the date of any such notification, or the
last day of the Issuance Period, as the case may be, being the “Cancellation
Date”), the Company will pay to each Purchaser which shall have agreed to
purchase such Accepted Note no later than one day after the Cancellation Date in
immediately available funds an amount (the “Cancellation Fee”) calculated as
follows:
PI X PA
where “PI” means Price Increase, i.e., the quotient (expressed in decimals)
obtained by dividing (a) the excess of the ask price (as determined by
Prudential) of the Hedge Treasury Note(s) on the Cancellation Date over the bid
price (as determined by Prudential) of the Hedge Treasury Notes(s) on the
Acceptance Day for such Accepted Note by (b) such bid price; and “PA” has the
meaning in Section 2(h)(iii). The foregoing bid and ask prices shall be as
reported by the publicly available source of such market data as is then
customarily used by Prudential. Each price shall be based on a U.S. Treasury
security having a par value of $100.00 and shall be rounded to the second
decimal place. In no case shall the Cancellation Fee be less than zero.
Section 3.    Closing.
Section 3.1.    Facility Closings. Not later than 11:30 A.M. (New York City
local time) on the Closing Day for any Accepted Notes (each, a “Closing”), the
Company will deliver to each Purchaser listed in the Confirmation of Acceptance
relating thereto at the offices of Prudential Capital Group, 2200 Ross Avenue,
Suite 4300, Dallas, TX 75201, Attention: Law Department or at such other place
pursuant to the directions of Prudential, the Accepted Notes to be purchased by
such Purchaser in the form of one or more Notes in authorized denominations as
such Purchaser may request for each Series of Accepted Notes to be purchased on
the Closing Day, dated the Closing Day and registered in such Purchaser’s name
(or in the name of its nominee), against payment of the purchase price therefor
by transfer of immediately available funds for credit to the Company’s account
specified in the Request for Purchase of such Notes.
Section 3.2.    Rescheduled Facility Closings. If the Company fails to tender to
any Purchaser the Accepted Notes to be purchased by such Purchaser on the
scheduled Closing Day for such Accepted Notes as provided above in Section 3.1,
or any of the conditions specified in Section 4 shall not have been fulfilled by
the time required on such scheduled Closing Day, the Company shall, prior to
1:00 P.M. (New York City local time) on such scheduled Closing Day notify
Prudential (which notification shall be deemed received by each Purchaser) in
writing whether (i) such closing is to be rescheduled (such rescheduled date to
be a Business Day during the Issuance Period not less than one (1) Business Day
and not more than ten (10) Business Days after such scheduled Closing Day (the
“Rescheduled Closing Day”)) and certify to Prudential (which certification shall
be for the benefit of each Purchaser) that the Company reasonably believes that
it will be able to comply with the conditions set forth in Section 4 on such
Rescheduled Closing Day and that the Company will pay the Delayed Delivery Fee
in accordance with Section 2(h)(iii) or (ii) such closing is to be canceled. In
the event that the Company shall fail to give such notice referred to in the

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Roanoke Gas Company        Private Shelf Agreement

preceding sentence, Prudential (on behalf of each Purchaser) may at its
election, at any time after 1:00 P.M. (New York City local time) on such
scheduled Closing Day, notify the Company in writing that such closing is to be
canceled. Notwithstanding anything to the contrary appearing in this Agreement,
the Company may not elect to reschedule a closing with respect to any given
Accepted Notes on more than one (1) occasion, unless Prudential shall have
otherwise consented in writing
Section 4.    Conditions to Closing.
Each Purchaser’s obligation to purchase and pay for the Notes to be sold to such
Purchaser at the Closing for such Notes is subject to the fulfillment to such
Purchaser’s satisfaction, prior to or at such Closing, of the following
conditions:
Section 4.1.    Representations and Warranties. The representations and
warranties of the Company in this Agreement and of the Parent Guarantor in the
Parent Guaranty shall be correct when made and at the time of the applicable
Closing, provided that, with respect to the applicable Closing, the Company
shall be permitted to make additions and deletions to the Schedules 5.3, 5.4,
5.5 and/or 5.15 and any further modifications to a representation and warranty
contained in Section 5 after the date of this Agreement but prior to such
Closing Day, so long as the Company shall have attached an updated copy of the
relevant Schedules and/or relevant modifications to the related Request for
Purchase (at least two (2) days prior to the Acceptance Day in accordance with
Section 2(d)), in which case such representations and warranties shall be
correct at the time of the delivery of such Request for Purchase and of the time
of the applicable Closing, giving effect to any such updated schedules and/or
modifications.
Section 4.2.    Performance; No Default. Each of the Company and the Parent
Guarantor shall have performed and complied with all agreements and conditions
contained in this Agreement and the Parent Guaranty, respectively, required to
be performed or complied with by it prior to or at such Closing. Before and
after giving effect to the issue and sale of the Notes (and the application of
the proceeds thereof as contemplated by Section 5.14), no Default or Event of
Default shall have occurred and be continuing. Neither the Company nor any
Subsidiary shall have entered into any transaction since September 30, 2014 that
would have been prohibited by Section 10 had such Section applied since such
date.
Section 4.3.    Compliance Certificates.
(a)    Company Officer’s Certificate. The Company shall have delivered to such
Purchaser an Officer’s Certificate, dated the date of such Closing, certifying
that the conditions specified in Sections 4.1, 4.2 and 4.9 have been fulfilled.
(b)    Company Secretary’s Certificate. The Company shall have delivered to such
Purchaser a certificate of its Secretary or Assistant Secretary, dated the date
of such Closing, certifying as to (i) the resolutions attached thereto and other
corporate proceedings relating to the authorization, execution and delivery of
the Notes and this Agreement and (ii) the Company’s organizational documents as
then in effect.

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Roanoke Gas Company        Private Shelf Agreement

(c)    Parent Guarantor Officer’s Certificate. The Parent Guarantor shall have
delivered to such Purchaser an Officer’s Certificate, dated the date of such
Closing, certifying that the conditions specified in Sections 4.1, 4.2 and 4.9
have been fulfilled.
(d)    Parent Guarantor Secretary’s Certificate. The Parent Guarantor shall have
delivered to such Purchaser a certificate of its Secretary or Assistant
Secretary, dated the date of such Closing, certifying as to (i) the resolutions
attached thereto and other corporate proceedings relating to the authorization,
execution and delivery of the Parent Guaranty and (ii) the Parent Guarantor’s
organizational documents as then in effect.
Section 4.4.    Opinions of Counsel. Such Purchaser shall have received opinions
in form and substance satisfactory to such Purchaser, dated the date of such
Closing (a) from Woods Rogers PLC, counsel for the Company and Parent Guarantor,
covering the matters set forth in Exhibit 4.4(a) and covering such other matters
incident to the transactions contemplated hereby as such Purchaser or its
counsel may reasonably request (and the Company hereby instructs its counsel to
deliver such opinion to the Purchasers) and (b) from Greenberg Traurig, LLP, the
Purchasers’ special counsel in connection with such transactions, substantially
in the form set forth in Exhibit 4.4(b) and covering such other matters incident
to such transactions as such Purchaser may reasonably request.
Section 4.5.    Purchase Permitted By Applicable Law, Etc. On the date of such
Closing such Purchaser’s purchase of Notes shall (a) be permitted by the laws
and regulations of each jurisdiction to which such Purchaser is subject, without
recourse to provisions (such as section 1405(a)(8) of the New York Insurance
Law) permitting limited investments by insurance companies without restriction
as to the character of the particular investment, (b) not violate any applicable
law or regulation (including, without limitation, Regulation T, U or X of the
Board of Governors of the Federal Reserve System) and (c) not subject such
Purchaser to any tax, penalty or liability under or pursuant to any applicable
law or regulation, which law or regulation was not in effect on the date of
Acceptance. If requested by such Purchaser, such Purchaser shall have received
an Officer’s Certificate certifying as to such matters of fact as such Purchaser
may reasonably specify to enable such Purchaser to determine whether such
purchase is so permitted.
Section 4.6.    Sale of Other Notes. Contemporaneously with such Closing the
Company shall sell to each other Purchaser and each other Purchaser shall
purchase the Notes to be purchased by it at such Closing as specified in the
applicable Confirmation of Acceptance.
Section 4.7.    Payment of Fees. (a) Without limiting Section 15.1, the Company
shall have paid to Prudential and each Purchaser on or before such Closing any
fees due Prudential and each Purchaser pursuant to or in connection with this
Agreement, including any Structuring Fee due pursuant to Section 2(h)(i), any
Issuance Fee due pursuant to Section 2(h)(ii) and any Delayed Delivery Fee due
pursuant to Section 2(h)(iii).
(b)    Without limiting Section 15.1, the Company shall have paid on or before
such Closing the fees, charges and disbursements of the Purchasers’ special
counsel referred to in Section 4.4(b) to the extent reflected in a statement of
such counsel rendered to the Company at least one Business Day prior to such
Closing.

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Roanoke Gas Company        Private Shelf Agreement

Section 4.8.    Private Placement Number. A Private Placement Number issued by
Standard & Poor’s CUSIP Service Bureau (in cooperation with the SVO) shall have
been obtained for such Notes.
Section 4.9.    Changes in Corporate Structure. Other than as permitted by this
Agreement, none of the Parent Guarantor, the Company or any Subsidiary shall
have changed its jurisdiction of incorporation or organization, as applicable,
or been a party to any merger or consolidation or succeeded to all or any
substantial part of the liabilities of any other entity, at any time following
the date of the most recent financial statements referred to in Schedule 5.5.
Section 4.10.    Proceedings and Documents. All corporate and other proceedings
in connection with the transactions contemplated by this Agreement and all
documents and instruments incident to such transactions shall be satisfactory to
such Purchaser and its special counsel, and such Purchaser and its special
counsel shall have received all such counterpart originals or certified or other
copies of such documents as such Purchaser or such special counsel may
reasonably request.
Section 4.11.    Parent Guaranty. The Parent Guaranty shall have been duly
executed and delivered by the Parent Guarantor (and such Purchaser shall have
received an original copy thereof), shall be in full force and effect on the
date hereof and shall be satisfactory in form and substance to such
Purchaser.    
Section 4.12.    Commission Approval. The State Corporation Commission of the
Commonwealth of Virginia shall have issued an appropriate order authorizing the
issue and sale of such Notes, and said order shall remain in full force and
effect on the date of such Closing and not be subject to any stay or suspension.
The issuance and effectiveness of such order shall be a condition precedent to
the performance by the Company of its obligations under this Agreement (except
its obligations under Section 15.1).
Section 4.13.    Certain Documents. Such Purchaser shall have received the
following:
(a)    The Note(s) to be purchased by such Purchaser at such Closing.
(b)    Certified copies of the resolutions of the Board of Directors of the
Company authorizing the execution and delivery of this Agreement and the
issuance of the Notes, and of all documents evidencing other necessary corporate
action and governmental approvals, if any, with respect to this Agreement and
the Notes (provided, that for any Closing, the Company may certify that there
has been no change to any applicable authorization or approval since the date on
which it was most recently delivered to such Purchaser under this Section 4.13
as an alternative to the further delivery thereof).
(c)    A certificate of the Secretary or an Assistant Secretary and one other
officer of the Company certifying the names and true signatures of the officers
of the Company authorized to sign this Agreement and the Notes and the other
documents to be delivered hereunder (provided, that for any Closing, the
Secretary or an Assistant Secretary and one other officer of the Company may
certify that there has been no change to the officers of the Company authorized
to sign Notes and other documents to be delivered therewith since the date on
which a certificate setting forth the

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Roanoke Gas Company        Private Shelf Agreement

names and true signatures of such officers, as described above, was most
recently delivered to such Purchaser under this Section 4.13, as an alternative
to the further delivery thereof).
(d)    Certified copies of the Certificate of Incorporation and By-laws of the
Company (provided, that for any Closing, the Company may certify that there has
been no change to any applicable constitutive document since the date on which
it was most recently delivered to such Purchaser under this Section 4.13, as an
alternative to the further delivery thereof).
(e)    A good standing certificate for the Company from the Secretary of State
of the Commonwealth of Virginia dated of a recent date prior to such Closing and
such other evidence of the status of the Company as such Purchaser may
reasonably request.
(f)    The Parent Guarantor shall have reaffirmed all of its obligations under
its Parent Guaranty, including with respect to the Note(s) to be purchased by
such Purchaser at such Closing.    
Section 5.    Representations and Warranties of the Company.
The Company represents and warrants to each Purchaser that, as of the date
hereof and as of each Closing:
Section 5.1.    Organization; Power and Authority. The Company is a corporation
duly organized, validly existing and in good standing under the laws of its
jurisdiction of incorporation, and is duly qualified as a foreign corporation
and is in good standing in each jurisdiction in which such qualification is
required by law, other than those jurisdictions as to which the failure to be so
qualified or in good standing could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect. The Company has the
corporate power and authority to own or hold under lease the properties it
purports to own or hold under lease, to transact the business it transacts and
proposes to transact, to execute and deliver this Agreement and the Notes and to
perform the provisions hereof and thereof.
Section 5.2.    Authorization, Etc. This Agreement has been, and, upon the
execution and delivery of any Note, such Note will have been, duly authorized by
all necessary corporate action on the part of the Company, and this Agreement
constitutes, and upon execution and delivery thereof each Note will constitute,
a legal, valid and binding obligation of the Company enforceable against the
Company in accordance with its terms, except as such enforceability may be
limited by (i) applicable bankruptcy, insolvency, reorganization, moratorium or
other similar laws affecting the enforcement of creditors’ rights generally and
(ii) general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law).
Section 5.3.    Disclosure. This Agreement, the financial statements listed in
Schedule 5.5 and the documents, certificates or other writings delivered to the
Purchasers by or on behalf of the Company in connection with the transactions
contemplated hereby and identified in Schedule 5.3 (as may be amended in
connection with a Closing in accordance with Section 4.1 hereunder) (this
Agreement and such documents, certificates or other writings, and such financial
statements delivered to each Purchaser prior to the applicable Closing being
referred to, collectively, as the

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Roanoke Gas Company        Private Shelf Agreement

“Disclosure Documents”), taken as a whole, do not contain any untrue statement
of a material fact or omit to state any material fact necessary to make the
statements therein not misleading in light of the circumstances under which they
were made. Except as disclosed in the Disclosure Documents, since the end of the
most recent fiscal year for which audited financial statements have been
furnished, there has been no change in the financial condition, operations,
business, properties or prospects of the Company or any Subsidiary except
changes that could not, individually or in the aggregate, reasonably be expected
to have a Material Adverse Effect. There is no fact known to the Company that
could reasonably be expected to have a Material Adverse Effect that has not been
set forth herein or in the Disclosure Documents.
Section 5.4.    Organization and Ownership of Shares of Subsidiaries;
Affiliates. (a) Schedule 5.4 (as may be amended in connection with a Closing in
accordance with Section 4.1 hereunder) contains (except as noted therein)
complete and correct lists of (i) the Company’s Subsidiaries, showing, as to
each Subsidiary, the name thereof, the jurisdiction of its organization, and the
percentage of shares of each class of its capital stock or similar equity
interests outstanding owned by the Company and each other Subsidiary, (ii) the
Company’s Affiliates, other than Subsidiaries, and (iii) the Company’s directors
and senior officers.
(a)    All of the outstanding shares of capital stock or similar equity
interests of each Subsidiary shown in Schedule 5.4 as being owned by the Company
and its Subsidiaries have been validly issued, are fully paid and non-assessable
and are owned by the Company or another Subsidiary free and clear of any Lien
that is prohibited by this Agreement.
(b)    Each Subsidiary is a corporation or other legal entity duly organized,
validly existing and, where applicable, in good standing under the laws of its
jurisdiction of organization, and is duly qualified as a foreign corporation or
other legal entity and, where applicable, is in good standing in each
jurisdiction in which such qualification is required by law, other than those
jurisdictions as to which the failure to be so qualified or in good standing
could not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect. Each such Subsidiary has the corporate or other power
and authority to own or hold under lease the properties it purports to own or
hold under lease and to transact the business it transacts and proposes to
transact.
(c)    No Subsidiary is subject to any legal, regulatory, contractual or other
restriction (other than the agreements listed on Schedule 5.4 and customary
limitations imposed by corporate law or similar statutes) restricting the
ability of such Subsidiary to pay dividends out of profits or make any other
similar distributions of profits to the Company or any of its Subsidiaries that
owns outstanding shares of capital stock or similar equity interests of such
Subsidiary.
Section 5.5.    Financial Statements; Material Liabilities. The Company has
delivered to each Purchaser of any Accepted Notes copies of the financial
statements listed on Schedule 5.5 (as may be amended in connection with a
Closing in accordance with Section 4.1 hereunder) and as identified by a
principal financial officer of the Company including (i) a consolidating and
consolidated balance sheet of the Parent Guarantor and its Subsidiaries as at
September 30 in each of the three fiscal years of the Parent Guarantor most
recently completed prior to the date as of

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Roanoke Gas Company        Private Shelf Agreement

which this representation is made or repeated to such Purchaser (other than
fiscal years completed within 90 days prior to such date for which audited
financial statements have not been released) and consolidating and consolidated
statements of income, cash flows and shareholders’ equity of the Parent
Guarantor and its Subsidiaries for each such year, all reported on by Brown
Edwards & Company, L.L.P. and (ii) a consolidated balance sheet of the Company
and its Subsidiaries as at the end of the quarterly period (if any) most
recently completed prior to such date and after the end of such fiscal year
(other than quarterly periods completed within 60 days prior to such date for
which financial statements have not been released) and the comparable quarterly
period in the preceding fiscal year and consolidated statements of income, cash
flows and shareholders’ equity for the periods from the beginning of the fiscal
years in which such quarterly periods are included to the end of such quarterly
periods, prepared by the Company. All of such financial statements (including in
each case the related schedules and notes) fairly present in all material
respects the consolidated financial position of the Company and its Subsidiaries
as of the respective dates thereof and the consolidated results of their
operations and cash flows for the respective periods indicated and have been
prepared in accordance with GAAP consistently applied throughout the periods
involved except as set forth in the notes thereto (subject, in the case of any
interim financial statements, to normal year-end adjustments). The Company and
its Subsidiaries do not have any Material liabilities that are not disclosed in
the Disclosure Documents.
Section 5.6.    Compliance with Laws, Other Instruments, Etc. The execution,
delivery and performance by the Company of this Agreement and the Notes will not
(i) contravene, result in any breach of, or constitute a default under, or
result in the creation of any Lien in respect of any property of the Company or
any Subsidiary under, any indenture, mortgage, deed of trust, loan, purchase or
credit agreement, lease, corporate charter or by-laws, shareholders agreement or
any other agreement or instrument to which the Company or any Subsidiary is
bound or by which the Company or any Subsidiary or any of their respective
properties may be bound or affected, (ii) conflict with or result in a breach of
any of the terms, conditions or provisions of any order, judgment, decree or
ruling of any court, arbitrator or Governmental Authority applicable to the
Company or any Subsidiary or (iii) violate any provision of any statute or other
rule or regulation of any Governmental Authority applicable to the Company or
any Subsidiary.
Section 5.7.    Governmental Authorizations, Etc. No consent, approval or
authorization of, or registration, filing or declaration with, any Governmental
Authority is required in connection with the execution, delivery or performance
by the Company of this Agreement or the Notes, other than consents, approvals,
authorizations, registrations, filings or declarations that have already been
obtained or made and are in full force and effect, and not subject to appeal.
Section 5.8.    Litigation; Observance of Agreements, Statutes and Orders.
(a) There are no actions, suits, investigations or proceedings pending or, to
the best knowledge of the Company, threatened against or affecting the Company
or any Subsidiary or any property of the Company or any Subsidiary in any court
or before any arbitrator of any kind or before or by any Governmental Authority
that could, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect.

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Roanoke Gas Company        Private Shelf Agreement

(a)    Neither the Company nor any Subsidiary is (i) in default under any
agreement or instrument to which it is a party or by which it is bound, (ii) in
violation of any order, judgment, decree or ruling of any court, arbitrator or
Governmental Authority or (iii) in violation of any applicable law, ordinance,
rule or regulation of any Governmental Authority (including, without limitation,
Environmental Laws, the USA PATRIOT Act or any of the other laws and regulations
that are referred to in Section 5.16), which default or violation could,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.
Section 5.9.    Taxes. The Company and its Subsidiaries have filed all tax
returns that are required to have been filed in any jurisdiction (taking into
account any applicable extensions), and have paid all taxes shown to be due and
payable on such returns and all other taxes and assessments levied upon them or
their properties, assets, income or franchises, to the extent such taxes and
assessments have become due and payable and before they have become delinquent,
except for any taxes and assessments (i) the amount of which, individually or in
the aggregate, is not Material or (ii) the amount, applicability or validity of
which is currently being contested in good faith by appropriate proceedings and
with respect to which the Company or a Subsidiary, as the case may be, has
established adequate reserves in accordance with GAAP. The Company knows of no
basis for any other tax or assessment that could, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect. The
charges, accruals and reserves on the books of the Company and its Subsidiaries
in respect of U.S. federal, state or other taxes for all fiscal periods are
adequate. The U.S. federal income tax liabilities of the Company and its
Subsidiaries have been finally determined (whether by reason of completed audits
or the statute of limitations having run) for all fiscal years up to and
including the fiscal year ended September 30, 2010.
Section 5.10.    Title to Property; Leases. The Company and its Subsidiaries
have good and sufficient title to their respective properties that are Material,
including all such properties reflected in the most recent audited balance sheet
referred to in Section 5.5 or purported to have been acquired by the Company or
any Subsidiary after such date (except as sold or otherwise disposed of in the
ordinary course of business), in each case free and clear of Liens prohibited by
this Agreement. All leases that are Material are valid and subsisting and are in
full force and effect in all material respects.
Section 5.11.    Licenses, Permits, Etc. (a) The Company and its Subsidiaries
own or possess all licenses, permits, franchises, authorizations, patents,
copyrights, proprietary software, service marks, trademarks and trade names, or
rights thereto, that are Material, without known conflict with the rights of
others.
(a)    To the best knowledge of the Company, no product or service of the
Company or any of its Subsidiaries infringes in any material respect any
license, permit, franchise, authorization, patent, copyright, proprietary
software, service mark, trademark, trade name or other right owned by any other
Person.
(b)    To the best knowledge of the Company, there is no Material violation by
any Person of any right of the Company or any of its Subsidiaries with respect
to any patent,

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Roanoke Gas Company        Private Shelf Agreement

copyright, proprietary software, service mark, trademark, trade name or other
right owned or used by the Company or any of its Subsidiaries.
Section 5.12.    Compliance with ERISA. (a) The Company and each ERISA Affiliate
have operated and administered each Plan in compliance with all applicable laws
except for such instances of noncompliance as have not resulted in and could
not, individually or in the aggregate, reasonably be expected to result in a
Material Adverse Effect.  Neither the Company nor any ERISA Affiliate has
incurred any liability pursuant to Title I or IV of ERISA or the penalty or
excise tax provisions of the Code relating to employee benefit plans (as defined
in section 3 of ERISA), and no event, transaction or condition has occurred or
exists that could, individually or in the aggregate, reasonably be expected to
result in the incurrence of any such liability by the Company or any ERISA
Affiliate, or in the imposition of any Lien on any of the rights, properties or
assets of the Company or any ERISA Affiliate, in either case pursuant to Title I
or IV of ERISA or to section 430(k) of the Code or to any such penalty or excise
tax provisions under the Code or federal law or section 4068 of ERISA or by the
granting of a security interest in connection with the amendment of a Plan,
other than such liabilities or Liens as would not be individually or in the
aggregate Material.
(a)    The present value of all accrued benefits under each of the Plans that
constitute employee pension benefit plans, as defined in Section 3 of ERISA
(other than Multiemployer Plans), based on those assumptions used to fund such
Plans, as calculated by the Company’s actuaries, did not, as of the end of the
Company’s most recently ended fiscal year for which audited financing statements
are available, exceed the value of the assets of such Plans allocable to such
benefits by an amount in excess of $5,000,000.
(b)    The Company and its ERISA Affiliates have not incurred withdrawal
liabilities (and are not subject to contingent withdrawal liabilities) under
section 4201 or 4204 of ERISA in respect of Multiemployer Plans that
individually or in the aggregate are Material.
(c)    The expected postretirement benefit obligation (determined as of the last
day of the Company’s most recently ended fiscal year in accordance with
Financial Accounting Standards Board Accounting Standards Codification Topic
715-60, without regard to liabilities attributable to continuation coverage
mandated by section 4980B of the Code) of the Company and its Subsidiaries did
not, as of the end of the Company’s most recently ended fiscal year for which
audited financial statements are available, exceed the value of the assets
allocable to such benefits by an amount in excess of $5,000,000.
(d)    The execution and delivery of this Agreement and the issuance and sale of
the Notes hereunder will not involve any transaction that is subject to the
prohibitions of section 406 of ERISA or in connection with which a tax could be
imposed pursuant to section 4975(c)(1)(A)-(D) of the Code. The representation by
the Company to each Purchaser in the first sentence of this Section 5.12(e) is
made in reliance upon and subject to the accuracy of such Purchaser’s
representation in Section 6.2 as to the sources of the funds to be used to pay
the purchase price of the Notes to be purchased by such Purchaser.
Section 5.13.    Private Offering by the Company. Neither the Company nor anyone
acting on its behalf has offered the Notes or any similar Securities for sale
to, or solicited any offer to buy

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Roanoke Gas Company        Private Shelf Agreement

the Notes or any similar Securities from, or otherwise approached or negotiated
in respect thereof with, any Person other than the Purchasers and other
Institutional Investors, each of which has been offered the Notes at a private
sale for investment. Neither the Company nor anyone acting on its behalf has
taken, or will take, any action that would subject the issuance or sale of the
Notes to the registration requirements of section 5 of the Securities Act or to
the registration requirements of any Securities or blue sky laws of any
applicable jurisdiction.
Section 5.14.    Use of Proceeds; Margin Regulations. The Company will apply the
proceeds of the sale of the Shelf Notes as set forth in the applicable Request
for Purchase. No part of the proceeds from the sale of the Notes hereunder will
be used, directly or indirectly, for the purpose of buying or carrying any
margin stock within the meaning of Regulation U of the Board of Governors of the
Federal Reserve System (12 CFR 221), or for the purpose of buying or carrying or
trading in any Securities under such circumstances as to involve the Company in
a violation of Regulation X of said Board (12 CFR 224) or to involve any broker
or dealer in a violation of Regulation T of said Board (12 CFR 220). Margin
stock does not constitute more than 1% of the value of the consolidated assets
of the Company and its Subsidiaries and the Company does not have any present
intention that margin stock will constitute more than 25% of the value of such
assets. As used in this Section, the terms “margin stock” and “purpose of buying
or carrying” shall have the meanings assigned to them in said Regulation U.
Section 5.15.    Existing Indebtedness; Future Liens. (a) Except as described
therein, Schedule 5.15 (as may be amended in connection with a Closing in
accordance with Section 4.1 hereunder) sets forth a complete and correct list of
all outstanding Indebtedness of the Company and its Subsidiaries as of the date
set forth therein (including descriptions of the obligors and obligees,
principal amounts outstanding, any collateral therefor and any Guaranties
thereof), since which date there has been no Material change in the amounts,
interest rates, sinking funds, installment payments or maturities of the
Indebtedness of the Company or its Subsidiaries. Neither the Company nor any
Subsidiary is in default and no waiver of default is currently in effect, in the
payment of any principal or interest on any Indebtedness of the Company or such
Subsidiary and no event or condition exists with respect to any Indebtedness of
the Company or any Subsidiary that would permit (or that with notice or the
lapse of time, or both, would permit) one or more Persons to cause such
Indebtedness to become due and payable before its stated maturity or before its
regularly scheduled dates of payment.
(a)    Except as disclosed in Schedule 5.15 (as may be amended in connection
with a Closing in accordance with Section 4.1 hereunder), neither the Company
nor any Subsidiary has agreed or consented to cause or permit any of its
property, whether now owned or hereafter acquired, to be subject to a Lien that
secures Indebtedness or to cause or permit in the future (upon the happening of
a contingency or otherwise) any of its property, whether now owned or hereafter
acquired, to be subject to a Lien that secures Indebtedness.
(b)    Neither the Company nor any Subsidiary is a party to, or otherwise
subject to any provision contained in, any instrument evidencing Indebtedness of
the Company or such Subsidiary, any agreement relating thereto or any other
agreement (including, but not limited to, its charter or any other
organizational document) which limits the amount of, or

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Roanoke Gas Company        Private Shelf Agreement

otherwise imposes restrictions on the incurring of, Indebtedness of the Company,
except as disclosed in Schedule 5.15 (as may be amended in connection with a
Closing in accordance with Section 4.1 hereunder).
Section 5.16.    Foreign Assets Control Regulations, Etc. (a) Neither the
Company nor any Controlled Entity is (i) a Person whose name appears on the list
of Specially Designated Nationals and Blocked Persons published by the Office of
Foreign Assets Control, United States Department of the Treasury (“OFAC”) (an
“OFAC Listed Person”) (ii) an agent, department, or instrumentality of, or is
otherwise beneficially owned by, controlled by or acting on behalf of, directly
or indirectly, (x) any OFAC Listed Person or (y) any Person, entity,
organization, foreign country or regime that is subject to any OFAC Sanctions
Program, or (iii) otherwise blocked, subject to sanctions under or engaged in
any activity in violation of other United States economic sanctions, including
but not limited to, the Trading with the Enemy Act, the International Emergency
Economic Powers Act, the Comprehensive Iran Sanctions, Accountability and
Divestment Act (“CISADA”) or any similar law or regulation with respect to Iran
or any other country, the Sudan Accountability and Divestment Act, any OFAC
Sanctions Program, or any economic sanctions regulations administered and
enforced by the United States or any enabling legislation or executive order
relating to any of the foregoing (collectively, “U.S. Economic Sanctions”) (each
OFAC Listed Person and each other Person, entity, organization and government of
a country described in clause (i), clause (ii) or clause (iii), a “Blocked
Person”). Neither the Company nor any Controlled Entity has been notified that
its name appears or may in the future appear on a state list of Persons that
engage in investment or other commercial activities in Iran or any other country
that is subject to U.S. Economic Sanctions.
(a)    No part of the proceeds from the sale of the Notes hereunder constitutes
or will constitute funds obtained on behalf of any Blocked Person or will
otherwise be used by the Company or any Controlled Entity, directly or
indirectly, (i) in connection with any investment in, or any transactions or
dealings with, any Blocked Person, or (ii) otherwise in violation of U.S.
Economic Sanctions.
(b)    Neither the Company nor any Controlled Entity (i) has been found in
violation of, charged with, or convicted of, money laundering, drug trafficking,
terrorist-related activities or other money laundering predicate crimes under
the Currency and Foreign Transactions Reporting Act of 1970 (otherwise known as
the Bank Secrecy Act), the USA PATRIOT Act or any other United States law or
regulation governing such activities (collectively, “Anti-Money Laundering
Laws”) or any U.S. Economic Sanctions violations, (ii) to the Company’s actual
knowledge after making due inquiry, is under investigation by any Governmental
Authority for possible violation of Anti-Money Laundering Laws or any U.S.
Economic Sanctions violations, (iii) has been assessed civil penalties under any
Anti-Money Laundering Laws or any U.S. Economic Sanctions, or (iv) has had any
of its funds seized or forfeited in an action under any Anti-Money Laundering
Laws. The Company has established procedures and controls which it reasonably
believes are adequate (and otherwise comply with applicable law) to ensure that
the Company and each Controlled Entity is and will continue to be in compliance
with all applicable current and future Anti-Money Laundering Laws and U.S.
Economic Sanctions.

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Roanoke Gas Company        Private Shelf Agreement

(c)    (i)    Neither the Company nor any Controlled Entity (i) has been charged
with, or convicted of bribery or any other anti-corruption related activity
under any applicable law or regulation in a U.S. or any non-U.S. country or
jurisdiction, including but not limited to, the U.S. Foreign Corrupt Practices
Act and the U.K. Bribery Act 2010 (collectively, “Anti-Corruption Laws”), (ii)
to the Company’s actual knowledge after making due inquiry, is under
investigation by any U.S. or non-U.S. Governmental Authority for possible
violation of Anti-Corruption Laws, (iii) has been assessed civil or criminal
penalties under any Anti-Corruption Laws or (iv) has been or is the target of
sanctions imposed by the United Nations or the European Union;
(i)    To the Company’s actual knowledge after making due inquiry, neither the
Company nor any Controlled Entity has, within the last five years, directly or
indirectly offered, promised, given, paid or authorized the offer, promise,
giving or payment of anything of value to a Governmental Official or a
commercial counterparty for the purposes of: (i) influencing any act, decision
or failure to act by such Government Official in his or her official capacity or
such commercial counterparty, (ii) inducing a Governmental Official to do or
omit to do any act in violation of the Governmental Official’s lawful duty, or
(iii) inducing a Governmental Official or a commercial counterparty to use his
or her influence with a government or instrumentality to affect any act or
decision of such government or entity; in each case in order to obtain, retain
or direct business or to otherwise secure an improper advantage in violation of
any applicable law or regulation or which would cause any holder to be in
violation of any law or regulation applicable to such holder; and
(ii)    No part of the proceeds from the sale of the Notes hereunder will be
used, directly or indirectly, for any improper payments, including bribes, to
any Governmental Official or commercial counterparty in order to obtain, retain
or direct business or obtain any improper advantage. The Company has established
procedures and controls which it reasonably believes are adequate (and otherwise
comply with applicable law) to ensure that the Company and each Controlled
Entity is and will continue to be in compliance with all applicable current and
future Anti-Corruption Laws.
Section 5.17.    Status under Certain Statutes. Neither the Company nor any
Subsidiary is subject to regulation under the Investment Company Act of 1940, as
amended, the Public Utility Holding Company Act of 2005, as amended, the ICC
Termination Act of 1995, as amended, or the Federal Power Act, as amended.
Section 5.18.    Environmental Matters. (a) Neither the Company nor any
Subsidiary has knowledge of any claim or has received any notice of any claim
and no proceeding has been instituted asserting any claim against the Company or
any of its Subsidiaries or any of their respective real properties or other
assets now or formerly owned, leased or operated by any of them, alleging any
damage to the environment or violation of any Environmental Laws, except, in
each case, such as could not reasonably be expected to result in a Material
Adverse Effect.

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Roanoke Gas Company        Private Shelf Agreement

(a)    Neither the Company nor any Subsidiary has knowledge of any facts which
would give rise to any claim, public or private, of violation of Environmental
Laws or damage to the environment emanating from, occurring on or in any way
related to real properties now or formerly owned, leased or operated by any of
them or to other assets or their use, except, in each case, such as could not,
individually or in the aggregate, reasonably be expected to result in a Material
Adverse Effect.
(b)    Neither the Company nor any Subsidiary has stored any Hazardous Materials
on real properties now or formerly owned, leased or operated by any of them in a
manner which is contrary to any Environmental Law that could, individually or in
the aggregate, reasonably be expected to result in a Material Adverse Effect.
(c)    Neither the Company nor any Subsidiary has disposed of any Hazardous
Materials in a manner which is contrary to any Environmental Law that could,
individually or in the aggregate, reasonably be expected to result in a Material
Adverse Effect.
(d)    All buildings on all real properties now owned, leased or operated by the
Company or any Subsidiary are in compliance with applicable Environmental Laws,
except where failure to comply could not, individually or in the aggregate,
reasonably be expected to result in a Material Adverse Effect.
Section 5.19.    Hostile Tender Offers. None of the proceeds of the sale of any
Notes will be used to finance a Hostile Tender Offer.
Section 6.    Representations of the Purchasers.
Section 6.1.    Purchase for Investment. Each Purchaser severally represents
that (i) it is an "accredited investor" as such term is defined in Rule 501
under the Securities Act, (ii) it has the experience and training necessary to
evaluate the merits and risks of a transaction of the nature of the transaction
that is the subject of this Agreement, (iii) it has had access to all of Parent
Guarantor’s publicly filed documents through EDGAR, (iv) it has had the
opportunity to ask questions and receive answers concerning the terms and
conditions of the transaction that is the subject of this Agreement and that the
Company has responded to all such requests by the Purchaser for information, and
(v) it is purchasing the Notes for its own account or for one or more separate
accounts maintained by such Purchaser or for the account of one or more pension
or trust funds and not with a view to the distribution thereof, provided that
the disposition of such Purchaser’s or their property shall at all times be
within such Purchaser’s or their control. Each Purchaser understands that the
Notes have not been registered under the Securities Act and may be resold only
if registered pursuant to the provisions of the Securities Act or if an
exemption from registration is available, except under circumstances where
neither such registration nor such an exemption is required by law, and that the
Company is not required to register the Notes.
Section 6.2.    Source of Funds. Each Purchaser severally represents that at
least one of the following statements is an accurate representation as to each
source of funds (a “Source”) to be used by such Purchaser to pay the purchase
price of the Notes to be purchased by such Purchaser hereunder:

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Roanoke Gas Company        Private Shelf Agreement

(a)    the Source is an “insurance company general account” (as the term is
defined in the United States Department of Labor’s Prohibited Transaction
Exemption (“PTE”) 95-60) in respect of which the reserves and liabilities (as
defined by the annual statement for life insurance companies approved by the
NAIC (the “NAIC Annual Statement”)) for the general account contract(s) held by
or on behalf of any employee benefit plan together with the amount of the
reserves and liabilities for the general account contract(s) held by or on
behalf of any other employee benefit plans maintained by the same employer (or
affiliate thereof as defined in PTE 95-60) or by the same employee organization
in the general account do not exceed 10% of the total reserves and liabilities
of the general account (exclusive of separate account liabilities) plus surplus
as set forth in the NAIC Annual Statement filed with such Purchaser’s state of
domicile; or
(b)    the Source is a separate account that is maintained solely in connection
with such Purchaser’s fixed contractual obligations under which the amounts
payable, or credited, to any employee benefit plan (or its related trust) that
has any interest in such separate account (or to any participant or beneficiary
of such plan (including any annuitant)) are not affected in any manner by the
investment performance of the separate account; or
(c)    the Source is either (i) an insurance company pooled separate account,
within the meaning of PTE 90-1 or (ii) a bank collective investment fund, within
the meaning of the PTE 91-38 and, except as disclosed by such Purchaser to the
Company in writing pursuant to this clause (c), no employee benefit plan or
group of plans maintained by the same employer or employee organization
beneficially owns more than 10% of all assets allocated to such pooled separate
account or collective investment fund; or
(d)    the Source constitutes assets of an “investment fund” (within the meaning
of Part VI of PTE 84-14 (the “QPAM Exemption”)) managed by a “qualified
professional asset manager” or “QPAM” (within the meaning of Part VI of the QPAM
Exemption), no employee benefit plan’s assets that are managed by the QPAM in
such investment fund, when combined with the assets of all other employee
benefit plans established or maintained by the same employer or by an affiliate
(within the meaning of Part VI(c)(1) of the QPAM Exemption) of such employer or
by the same employee organization and managed by such QPAM, represent more than
20% of the total client assets managed by such QPAM, the conditions of Part I(c)
and (g) of the QPAM Exemption are satisfied, neither the QPAM nor a person
controlling or controlled by the QPAM maintains an ownership interest in the
Company that would cause the QPAM and the Company to be “related” within the
meaning of Part VI(h) of the QPAM Exemption and (i) the identity of such QPAM
and (ii) the names of any employee benefit plans whose assets in the investment
fund, when combined with the assets of all other employee benefit plans
established or maintained by the same employer or by an affiliate (within the
meaning of Part VI(c)(1) of the QPAM Exemption) of such employer or by the same
employee organization, represent 10% or more of the assets of such investment
fund, have been disclosed to the Company in writing pursuant to this clause
(d);or

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Roanoke Gas Company        Private Shelf Agreement

(e)    the Source constitutes assets of a “plan(s)” (within the meaning of Part
IV(h) of PTE 96-23 (the “INHAM Exemption”)) managed by an “in-house asset
manager” or “INHAM” (within the meaning of Part IV(a) of the INHAM Exemption),
the conditions of Part I(a), (g) and (h) of the INHAM Exemption are satisfied,
neither the INHAM nor a person controlling or controlled by the INHAM (applying
the definition of “control” in Part IV(d)(3) of the INHAM Exemption) owns a 10%
or more interest in the Company and (i) the identity of such INHAM and (ii) the
name(s) of the employee benefit plan(s) whose assets constitute the Source have
been disclosed to the Company in writing pursuant to this clause (e); or
(f)    the Source is a governmental plan; or
(g)    the Source is one or more employee benefit plans, or a separate account
or trust fund comprised of one or more employee benefit plans, each of which has
been identified to the Company in writing pursuant to this clause (g); or
(h)    the Source does not include assets of any employee benefit plan, other
than a plan exempt from the coverage of ERISA.
As used in this Section 6.2, the terms “employee benefit plan”, “governmental
plan”, and “separate account” shall have the respective meanings assigned to
such terms in section 3 of ERISA.
Section 7.    Information as to Company.
Section 7.1.    Financial and Business Information. The Company shall deliver or
cause to be delivered to Prudential, each Purchaser and each holder of a Note
that is an Institutional Investor:
(a)    Quarterly Statements — as soon as available and in any event within
45 days (or such shorter period as is the earlier of (x) 15 days greater than
the period applicable to the filing of the Company’s Quarterly Report on
Form 10‑Q (the “Form 10‑Q”) with the SEC regardless of whether the Company is
subject to the filing requirements thereof and (y) the date by which such
financial statements are required to be delivered under any Material Credit
Facility or the date on which such corresponding financial statements are
delivered under any Material Credit Facility if such delivery occurs earlier
than such required delivery date) after the end of each quarterly fiscal period
in each fiscal year of the Company (other than the last quarterly fiscal period
of each such fiscal year), duplicate copies of,
(i)    a consolidated balance sheet of the Company and its Subsidiaries as at
the end of such quarter, and
(ii)    consolidated statements of income, changes in shareholders’ equity and
cash flows of the Company and its Subsidiaries, for such quarter and (in the
case of the second and third quarters) for the portion of the fiscal year ending
with such quarter,

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Roanoke Gas Company        Private Shelf Agreement

setting forth in each case in comparative form the figures for the corresponding
periods in the previous fiscal year, all in reasonable detail, prepared in
accordance with GAAP applicable to quarterly financial statements generally, and
certified by a Senior Financial Officer of the Company as fairly presenting, in
all material respects, the financial position of the companies being reported on
and their results of operations and cash flows, subject to changes resulting
from year-end adjustments, provided that delivery within the time period
specified above of copies of the Company’s Form 10‑Q prepared in compliance with
the requirements therefor and filed with the SEC shall be deemed to satisfy the
delivery requirements for the Company’s financial statements under this
Section 7.1(a);
(b)    Annual Statements — as soon as available and in any event within 90 days
(or such shorter period as is the earlier of (x) 15 days greater than the period
applicable to the filing of the Parent Guarantor’s Annual Report on Form 10‑K
(the “Form 10‑K”) with the SEC regardless of whether the Parent Guarantor is
subject to the filing requirements thereof and (y) the date by which such
financial statements are required to be delivered under any Material Credit
Facility or the date on which such corresponding financial statements are
delivered under any Material Credit Facility if such delivery occurs earlier
than such required delivery date) after the end of each fiscal year of the
Company, duplicate copies of,
(i)    a consolidated and consolidating balance sheet of the Parent Guarantor
and its Subsidiaries as at the end of such year, and
(ii)    consolidated and consolidating statements of income, changes in
shareholders’ equity and cash flows of the Parent Guarantor and its Subsidiaries
for such year,
setting forth in each case in comparative form the figures for the previous
fiscal year, all in reasonable detail, prepared in accordance with GAAP, and
accompanied by an opinion thereon (without a “going concern” or similar
qualification or exception and without any qualification or exception as to the
scope of the audit on which such opinion is based) of independent public
accountants of recognized national standing, which opinion shall state that such
financial statements of the Parent Guarantor present fairly, in all material
respects, the financial position of the companies being reported upon and their
results of operations and cash flows and have been prepared in conformity with
GAAP, and that the examination of such accountants in connection with such
financial statements has been made in accordance with generally accepted
auditing standards, and that such audit provides a reasonable basis for such
opinion in the circumstances, provided that the delivery within the time period
specified above of the Parent Guarantor’s Form 10‑K for such fiscal year
(together with the Parent Guarantor’s annual report to shareholders, if any,
prepared pursuant to Rule 14a‑3 under the Exchange Act) prepared in accordance
with the requirements therefor and filed with the SEC, shall be deemed to
satisfy the requirements of this Section 7.1(b) (provided that such Form 10-K
includes both the consolidated and consolidating financial statements required
by this Section 7.1(b));

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Roanoke Gas Company        Private Shelf Agreement

(c)    Audited Financial Statements of the Company — in the event that the
Company shall cease to be a Wholly-Owned Subsidiary of the Parent Guarantor,
then, within the time period provided in Section 7.1(b) above, the Company shall
deliver to each holder of Notes that is an Institutional Investor, financial
statements of the character and for the dates and periods as in said Sections
7.1(b), but covering the Company and its Subsidiaries (on a consolidated basis),
and accompanied by an opinion thereon (without a “going concern” or similar
qualification or exception and without any qualification or exception as to the
scope of the audit on which such opinion is based) of independent public
accountants of recognized national standing, which opinion shall state that such
financial statements of the Company present fairly, in all material respects,
the financial position of the companies being reported upon and their results of
operations and cash flows and have been prepared in conformity with GAAP, and
that the examination of such accountants in connection with such financial
statements has been made in accordance with generally accepted auditing
standards, and that such audit provides a reasonable basis for such opinion in
the circumstances, provided that the delivery within the time period specified
in Section 7.1(b) above of the Company’s Form 10‑K, if applicable, for such
fiscal year (together with the Company’s annual report to shareholders, if any,
prepared pursuant to Rule 14a‑3 under the Exchange Act) prepared in accordance
with the requirements therefor and filed with the SEC, shall be deemed to
satisfy the requirements of this Section 7.1(c);
(d)    SEC and Other Reports — promptly upon their becoming available, one copy
of (i) each financial statement, report, notice or proxy statement sent by the
Parent Guarantor, Company or any Subsidiary to its principal lending banks as a
whole (excluding information sent to such banks in the ordinary course of
administration of a bank facility, such as information relating to pricing and
borrowing availability) or to its public Securities holders generally, and
(ii) each regular or periodic report, each registration statement (without
exhibits except as expressly requested by such Purchaser or holder), and each
prospectus and all amendments thereto filed by the Parent Guarantor, Company or
any Subsidiary with the SEC and of all press releases and other statements made
available generally by the Parent Guarantor, Company or any Subsidiary to the
public concerning developments that are Material;
(e)    Notice of Default or Event of Default — promptly, and in any event within
five Business Days after a Responsible Officer becoming aware of the existence
of any Default or Event of Default or that any Person has given any notice or
taken any action with respect to a claimed default hereunder or that any Person
has given any notice or taken any action with respect to a claimed default of
the type referred to in Section 11(f), a written notice specifying the nature
and period of existence thereof and what action the Company is taking or
proposes to take with respect thereto;
(f)    ERISA Matters — promptly, and in any event within five Business Days
after a Responsible Officer becoming aware of any of the following, a written
notice setting forth the nature thereof and the action, if any, that the Company
or an ERISA Affiliate proposes to take with respect thereto:

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Roanoke Gas Company        Private Shelf Agreement

(i)    with respect to any Plan, any reportable event, as defined in
section 4043(c) of ERISA and the regulations thereunder, for which notice
thereof has not been waived pursuant to such regulations as in effect on the
date hereof; or
(ii)    the taking by the PBGC of steps to institute, or the threatening by the
PBGC of the institution of, proceedings under section 4042 of ERISA for the
termination of, or the appointment of a trustee to administer, any Plan, or the
receipt by the Company or any ERISA Affiliate of a notice from a Multiemployer
Plan that such action has been taken by the PBGC with respect to such
Multiemployer Plan; or
(iii)    any event, transaction or condition that could result in the incurrence
of any liability by the Company or any ERISA Affiliate pursuant to Title I or IV
of ERISA or the penalty or excise tax provisions of the Code relating to
employee benefit plans, or in the imposition of any Lien on any of the rights,
properties or assets of the Company or any ERISA Affiliate pursuant to Title I
or IV of ERISA or such penalty or excise tax provisions, if such liability or
Lien, taken together with any other such liabilities or Liens then existing,
could reasonably be expected to have a Material Adverse Effect;
(g)    Notices from Governmental Authority — promptly, and in any event within
30 days of receipt thereof, copies of any notice to the Company or any
Subsidiary from any federal or state Governmental Authority relating to any
order, ruling, statute or other law or regulation that could reasonably be
expected to have a Material Adverse Effect;
(h)    Resignation or Replacement of Auditors — within ten days following the
date on which the Parent Guarantor’s auditors (or, in the event that the Company
is required to deliver audited statements pursuant to Section 7.1(c), the
Company’s auditors) resign or the Parent Guarantor (or, in the event that the
Company is required to deliver audited statements pursuant to Section 7.1(c),
the Company) elects to change auditors, as the case may be, notification
thereof, together with such supporting information as the Required Holders may
request; and
(i)    Requested Information — with reasonable promptness, such other data and
information relating to the business, operations, affairs, financial condition,
assets or properties of the Parent Guarantor, the Company or any of its
Subsidiaries (including, but without limitation, actual copies of the Parent
Guarantor’s or Company’s Form 10‑Q and Form 10‑K, as applicable) or relating to
the ability of the Company to perform its obligations hereunder and under the
Notes or the ability of the Parent Guarantor to perform its obligations under
the Parent Guaranty, as from time to time may be reasonably requested by any
such holder of a Note; provided that, if the Company reasonably determines after
consultation with counsel qualified to advise on such matters that,
notwithstanding the confidentiality requirements of Section 20, the Company
would be prohibited from disclosing such data or information pursuant to
Regulation FD promulgated by the Securities and Exchange Commission without
making public disclosure thereof, then the Company shall not be required to
disclose such data or information required by this Section 7.1(i), but the
Company

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Roanoke Gas Company        Private Shelf Agreement

shall promptly notify such holder in writing that it has withheld data or
information pursuant to this proviso.
Section 7.2.    Officer’s Certificate. Each set of financial statements
delivered to a Purchaser or holder of a Note pursuant to Section 7.1(a), Section
7.1(b) or Section 7.1(c) shall be accompanied by a certificate of a Senior
Financial Officer:
(a)    Covenant Compliance — setting forth the information from such financial
statements that is required in order to establish whether the Company was in
compliance with the requirements of Section 10 during the quarterly or annual
period covered by the statements then being furnished, (including with respect
to each such provision that involves mathematical calculations, the information
from such financial statements that is required to perform such calculations)
and detailed calculations of the maximum or minimum amount, ratio or percentage,
as the case may be, permissible under the terms of such Section, and the
calculation of the amount, ratio or percentage then in existence. In the event
that the Company or any Subsidiary has made an election to measure any financial
liability using fair value (which election is being disregarded for purposes of
determining compliance with this Agreement pursuant to Section 22.2) as to the
period covered by any such financial statement, such Senior Financial Officer’s
certificate as to such period shall include a reconciliation from GAAP with
respect to such election; and
(b)    Event of Default — certifying that such Senior Financial Officer has
reviewed the relevant terms hereof and has made, or caused to be made, under his
or her supervision, a review of the transactions and conditions of the Company
and its Subsidiaries from the beginning of the quarterly or annual period
covered by the statements then being furnished to the date of the certificate
and that such review shall not have disclosed the existence during such period
of any condition or event that constitutes a Default or an Event of Default or,
if any such condition or event existed or exists (including, without limitation,
any such event or condition resulting from the failure of the Company or any
Subsidiary to comply with any Environmental Law), specifying the nature and
period of existence thereof and what action the Company shall have taken or
proposes to take with respect thereto.
Section 7.3.    Visitation. The Company shall permit the representatives of each
Purchaser and each holder of a Note that is an Institutional Investor:
(a)    No Default — if no Default or Event of Default then exists, at the
expense of such Purchaser or such holder and upon reasonable prior notice to the
Company, to visit the principal executive office of the Company, to discuss the
affairs, finances and accounts of the Company and its Subsidiaries with the
Company’s officers, and (with the consent of the Company, which consent will not
be unreasonably withheld) its independent public accountants, and (with the
consent of the Company, which consent will not be unreasonably withheld) to
visit the other offices and properties of the Company and each Subsidiary, all
at such reasonable times and as often as may be reasonably requested in writing;
and
(b)    Default — if a Default or Event of Default then exists, at the expense of
the Company and upon reasonable prior notice to visit and inspect any of the
offices or properties

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Roanoke Gas Company        Private Shelf Agreement

of the Company or any Subsidiary, to examine all their respective books of
account, records, reports and other papers, to make copies and extracts
therefrom, and to discuss their respective affairs, finances and accounts with
their respective officers and independent public accountants (and by this
provision the Company authorizes said accountants to discuss the affairs,
finances and accounts of the Company and its Subsidiaries), all at such times
and as often as may be requested.
Section 7.4.    Electronic Delivery. Financial statements, opinions of
independent certified public accountants, other information and Officer’s
Certificates that are required to be delivered by the Company pursuant to
Sections 7.1(a), (b), (c) or (d) and Section 7.2 shall be deemed to have been
delivered if the Company satisfies any of the following requirements with
respect thereto:
(i)    such financial statements satisfying the requirements of Section 7.1(a),
(b) or (c), as the case may be, and related Officer’s Certificate satisfying the
requirements of Section 7.2 are delivered to each Purchaser and each holder of a
Note by e-mail;
(ii)    the Company or the Parent Guarantor, as applicable, shall have timely
filed its Form 10–Q or Form 10–K, satisfying the requirements of Section 7.1(a),
Section 7.1(b) or Section 7.1(c) as the case may be, with the SEC on EDGAR and
the Company shall have made such form and the related Officer’s Certificate
satisfying the requirements of Section 7.2 available on its home page on the
internet, which is located at http://rgcresources.com as of the date of this
Agreement;
(iii)    such financial statements satisfying the requirements of
Section 7.1(a), Section 7.1(b) or Section 7.1(c) and related Officer’s
Certificate(s) satisfying the requirements of Section 7.2 are timely posted by
or on behalf of the Company on IntraLinks or on any other similar website to
which each holder of Notes has free access; or
(iv)    the Company or the Parent Guarantor, as applicable, shall have filed any
of the items referred to in Section 7.1(d) with the SEC on EDGAR and shall have
made such items available on its home page on the internet or on IntraLinks or
on any other similar website to which each holder of Notes has free access;
provided however, that in the case of any of clauses (ii), (iii) or (iv), the
Company shall have given each Purchaser and each holder of a Note prior written
notice, which may be by e-mail or in accordance with Section 18, of such posting
or filing in connection with each delivery, provided further, that upon request
of any holder to receive paper copies of such forms, financial statements and
Officer’s Certificates or to receive them by e-mail, the Company will promptly
e-mail them or deliver such paper copies, as the case may be, to such holder.
Section 8.    Payment and Prepayment of the Notes.
Section 8.1.    Required Prepayments. Each Series of Notes shall be subject to
required prepayments, if any, set forth in the Notes of such Series, provided
that upon any partial prepayment

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Roanoke Gas Company        Private Shelf Agreement

of the Notes of any Series pursuant to Section 8.2, 8.7 or 8.8, the principal
amount of each required prepayment of the Notes of such Series becoming due
under this Section 8.1 on and after the date of such prepayment shall be reduced
in the same proportion as the aggregate unpaid principal amount of the Notes of
such Series is reduced as a result of such prepayment. As provided therein, the
entire unpaid principal balance of each Note shall be due and payable on the
Maturity Date thereof.
Section 8.2.    Optional Prepayments with Make-Whole Amount. The Company may, at
its option, upon notice as provided below, prepay at any time all, or from time
to time any part of, any Series of Notes, in an amount not less than 5% of the
aggregate principal amount of such Series of Notes then outstanding (in the case
of a partial prepayment), at 100% of the principal amount so prepaid, and the
Make-Whole Amount determined for the prepayment date with respect to such
principal amount. The Company will give each holder of the Series of Notes to be
prepaid written notice of each optional prepayment under this Section 8.2 not
less than ten days and not more than 60 days prior to the date fixed for such
prepayment unless the Company and the Required Holders agree to another time
period pursuant to Section 17. Each such notice shall specify such date (which
shall be a Business Day), the aggregate principal amount of the Series of Notes
to be prepaid on such date, the principal amount of each Note held by such
holder to be prepaid (determined in accordance with Section 8.3), and the
interest to be paid on the prepayment date with respect to such principal amount
being prepaid, and shall be accompanied by a certificate of a Senior Financial
Officer as to the estimated Make-Whole Amount due in connection with such
prepayment (calculated as if the date of such notice were the date of the
prepayment), setting forth the details of such computation. Two Business Days
prior to such prepayment, the Company shall deliver to each holder of the Series
of Notes to be prepaid a certificate of a Senior Financial Officer specifying
the calculation of such Make-Whole Amount as of the specified prepayment date.
Section 8.3.    Allocation of Partial Prepayments. In the case of each partial
prepayment of the Notes of any Series, pursuant to Section 8.1 or Section 8.2,
the principal amount of the Notes of such Series to be prepaid shall be
allocated among all of the Notes of such Series at the time outstanding in
proportion, as nearly as practicable, to the respective unpaid principal amounts
thereof not theretofore called for prepayment.
Section 8.4.    Maturity; Surrender, Etc. In the case of each optional
prepayment of Notes of any Series pursuant to this Section 8, the principal
amount of each Note to be prepaid shall mature and become due and payable on the
date fixed for such prepayment, together with interest on such principal amount
accrued to such date and the applicable Make-Whole Amount, if any. From and
after such date, unless the Company shall fail to pay such principal amount when
so due and payable, together with the interest and Make-Whole Amount, if any, as
aforesaid, interest on such principal amount shall cease to accrue. Any Note
paid or prepaid in full shall be surrendered to the Company and cancelled and
shall not be reissued, and no Note shall be issued in lieu of any prepaid
principal amount of any Note.
Section 8.5.    Purchase of Notes. The Company will not and will not permit any
Affiliate to purchase, redeem, prepay or otherwise acquire, directly or
indirectly, any of the outstanding Notes of any Series except upon the payment
or prepayment of the Notes of such Series in accordance with this Agreement and
the Notes of such Series. The Company will promptly cancel all Notes

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Roanoke Gas Company        Private Shelf Agreement

acquired by it or any Affiliate pursuant to any payment or prepayment of Notes
pursuant to this Agreement and no Notes may be issued in substitution or
exchange for any such Notes.
Section 8.6.    Make-Whole Amount.
“Make-Whole Amount” means, with respect to any Note, an amount equal to the
excess, if any, of the Discounted Value of the Remaining Scheduled Payments with
respect to the Called Principal of such Note over the amount of such Called
Principal, provided that the Make-Whole Amount may in no event be less than
zero. For the purposes of determining the Make-Whole Amount, the following terms
have the following meanings:
“Called Principal” means, with respect to any Note, the principal of such Note
that is to be prepaid pursuant to Section 8.2 or has become or is declared to be
immediately due and payable pursuant to Section 12.1, as the context requires.
“Discounted Value” means, with respect to the Called Principal of any Note, the
amount obtained by discounting all Remaining Scheduled Payments with respect to
such Called Principal from their respective scheduled due dates to the
Settlement Date with respect to such Called Principal, in accordance with
accepted financial practice and at a discount factor (applied on the same
periodic basis as that on which interest on the Notes is payable) equal to the
Reinvestment Yield with respect to such Called Principal.
“Reinvestment Yield” means, with respect to the Called Principal of any Note,
0.50% over the yield to maturity implied by the ask-side yield(s) reported as of
10:00 a.m. (New York City time) on the second Business Day preceding the
Settlement Date with respect to such Called Principal, on the display designated
as “Page PX1” (or such other display as may replace Page PX1) on Bloomberg
Financial Markets for the most recently issued actively traded on-the-run U.S.
Treasury securities (“Reported”) having a maturity equal to the Remaining
Average Life of such Called Principal as of such Settlement Date. If there are
no such U.S. Treasury securities Reported having a maturity equal to such
Remaining Average Life, then such implied yield to maturity will be determined
by (a) converting U.S. Treasury bill quotations to bond equivalent yields in
accordance with accepted financial practice and (b) interpolating linearly
between the yields Reported for the applicable most recently issued actively
traded on-the-run U.S. Treasury securities with the maturities (1) closest to
and greater than such Remaining Average Life and (2) closest to and less than
such Remaining Average Life. The Reinvestment Yield shall be rounded to the
number of decimal places as appears in the interest rate of the applicable Note.
If such yields are not Reported or the yields Reported as of such time are not
ascertainable (including by way of interpolation), then “Reinvestment Yield”
means, with respect to the Called Principal of any Note, 0.50% over the yield to
maturity implied by the U.S. Treasury constant maturity yields reported, for the
latest day for which such yields have been so reported as of the second Business
Day preceding the Settlement Date with respect to such Called Principal, in
Federal Reserve Statistical Release H.15 (or any comparable successor
publication) for the U.S. Treasury constant maturity having a term equal to the
Remaining Average Life of such Called Principal as of such Settlement Date. If
there is no such U.S. Treasury constant maturity having a term equal to such
Remaining Average Life, such implied yield to maturity will be determined by
interpolating

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Roanoke Gas Company        Private Shelf Agreement

linearly between (1) the U.S. Treasury constant maturity so reported with the
term closest to and greater than such Remaining Average Life and (2) the U.S.
Treasury constant maturity so reported with the term closest to and less than
such Remaining Average Life. The Reinvestment Yield shall be rounded to the
number of decimal places as appears in the interest rate of the applicable Note.
“Remaining Average Life” means, with respect to any Called Principal, the number
of years obtained by dividing (i) such Called Principal into (ii) the sum of the
products obtained by multiplying (a) the principal component of each Remaining
Scheduled Payment with respect to such Called Principal by (b) the number of
years, computed on the basis of a 360-day year composed of twelve 30-day months
and calculated to two decimal places, that will elapse between the Settlement
Date with respect to such Called Principal and the scheduled due date of such
Remaining Scheduled Payment.
“Remaining Scheduled Payments” means, with respect to the Called Principal of
any Note, all payments of such Called Principal and interest thereon that would
be due after the Settlement Date with respect to such Called Principal if no
payment of such Called Principal were made prior to its scheduled due date,
provided that if such Settlement Date is not a date on which interest payments
are due to be made under the Notes, then the amount of the next succeeding
scheduled interest payment will be reduced by the amount of interest accrued to
such Settlement Date and required to be paid on such Settlement Date pursuant to
Section 8.2 or Section 12.1.
“Settlement Date” means, with respect to the Called Principal of any Note, the
date on which such Called Principal is to be prepaid pursuant to Section 8.2 or
has become or is declared to be immediately due and payable pursuant to
Section 12.1, as the context requires.
Section 8.7.    Prepayment in Connection with an Asset Disposition.

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Roanoke Gas Company        Private Shelf Agreement

(a)    Notice and Offer. In the event that the Company shall elect to apply all
or any portion of the Net Proceeds Amount of an Asset Disposition towards an
Indebtedness Prepayment Application pursuant to the last paragraph of Section
10.7, the Company will give written notice thereof to the holders of all Notes
then outstanding. Such written notice shall contain, and such written notice
shall constitute, an irrevocable offer to prepay, at the election of each
holder, each outstanding Note held by such holder in a principal amount which
equals the Ratable Portion of such Note on a date specified in such notice
(which date shall be a Business Day) that is not less than 30 days and not more
than 60 days after the date of such notice (the “Disposition Prepayment Date”),
together with interest on the amount to be so prepaid accrued to the prepayment
date. If the Disposition Prepayment Date shall not be specified in such offer,
the Disposition Prepayment Date shall be the first Business Day which is at
least 45 days after the date of such offer.
(b)    Acceptance and Payment. A failure of a holder of Notes to respond to a
prepayment offer pursuant to this Section 8.7 in writing on or prior to a date
at least ten (10) Business Days prior to the Disposition Prepayment Date (such
date ten (10) Business Days prior to the Disposition Prepayment Date being the
“Disposition Response Date”), shall be deemed to constitute a rejection of the
offer. To accept such offer, a holder of Notes shall cause a notice of such
acceptance to be delivered to the Company not later than the Disposition
Response Date. Prepayment of the Notes to be made pursuant to this Section 8.7
shall be made at 100% of the principal amount of such Notes being so prepaid,
together with interest on such principal amount then being prepaid accrued to
the date of prepayment. The prepayment shall be made on the Disposition
Prepayment Date determined for prepayment pursuant to Section 8.7(a).
(c)    Officer’s Certificate. Each offer to prepay the Notes pursuant to this
Section 8.7 shall be accompanied by a certificate, executed by a Responsible
Officer of the Company and dated the date of such offer, specifying (i) the
Disposition Prepayment Date and the Disposition Response Date, (ii) the
Disposition Proceeds in respect of the applicable Disposition, (iii) that such
offer is being made pursuant to this Section 8.7 and the last paragraph of
Section 10.7, (iv) the Ratable Portion of each Note offered to be prepaid, (v)
the interest that would be due on each Note offered to be prepaid, accrued to
the prepayment date and (vi) in reasonable detail, the nature of such
Disposition.
Section 8.8.    Prepayment in Connection with a Put Right for Other
Indebtedness.
(a)    Notice and Offer. In the event that, as a consequence of the occurrence
or continuation of any event or condition (other than the passage of time or the
right of the holder of Indebtedness to convert such Indebtedness into equity
interests), (x) the Company, the Parent Guarantor or any Subsidiary has become
obligated to purchase or repay Indebtedness before its regular maturity or
before its regularly scheduled dates of payment in an aggregate outstanding
principal amount of at least $5,000,000, or (y) one or more Persons have the
right to require the Company, the Parent Guarantor or any Subsidiary so to
purchase or repay such Indebtedness, the Company will, within five (5) Business
Days thereafter, give written notice thereof to the holders of all Notes then
outstanding. Such written notice shall contain, and such written notice shall
constitute, an irrevocable offer to prepay, at the election of each holder, each
outstanding Note held by such holder at 100% of the principal amount of such
Notes being so prepaid, together with interest accrued

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Roanoke Gas Company        Private Shelf Agreement

thereon and the Make-Whole Amount determined as of a date specified in such
notice (which date shall be a Business Day) that is not less than 30 days and
not more than 60 days after the date of such notice (the “Cross-Put Prepayment
Date”). If the Cross-Put Prepayment Date shall not be specified in such offer,
the Cross-Put Prepayment Date shall be the first Business Day which is at least
45 days after the date of such offer.
(b)    Acceptance and Payment. A failure of a holder of Notes to respond to a
prepayment offer pursuant to this Section 8.8 in writing on or prior to a date
at least ten (10) Business Days prior to the Cross-Put Prepayment Date (such
date ten (10) Business Days prior to the Cross-Put Prepayment Date being the
“Cross-Put Response Date”), shall be deemed to constitute a rejection of the
offer. To accept such offer, a holder of Notes shall cause a notice of such
acceptance to be delivered to the Company not later than the Cross-Put Response
Date. Prepayment of the Notes to be made pursuant to this Section 8.8 shall be
made at 100% of the principal amount of such Notes being so prepaid, together
with interest accrued thereon and the Make-Whole Amount determined as of the
prepayment date. The prepayment shall be made on the Cross-Put Prepayment Date
determined for prepayment pursuant to Section 8.8(a).
(c)    Officer’s Certificate. Each offer to prepay the Notes pursuant to this
Section 8.8 shall be accompanied by a certificate, executed by a Responsible
Officer of the Company and dated the date of such offer, specifying (i) the
Cross-Put Prepayment Date and the Cross-Put Response Date, (ii) that such offer
is being made pursuant to this Section 8.8, (iii) the estimated Make-Whole
Amount due in connection with such prepayment (calculated as if the Cross-Put
Prepayment Date were the date of the prepayment), setting forth the details of
such computation, (iv) the interest that would be due on each Note offered to be
prepaid, accrued to the Cross-Put Prepayment Date and (v) in reasonable detail,
the nature of the event triggering such offer to prepay the Notes.
Section 8.9.    Payments Due on Non-Business Days. Anything in this Agreement or
the Notes to the contrary notwithstanding, (x) subject to clause (y), any
payment of interest on any Note that is due on a date that is not a Business Day
shall be made on the next succeeding Business Day without including the
additional days elapsed in the computation of the interest payable on such next
succeeding Business Day; and (y) any payment of principal of or Make-Whole
Amount on any Note (including principal due on the Maturity Date of such Note)
that is due on a date that is not a Business Day shall be made on the next
succeeding Business Day and shall include the additional days elapsed in the
computation of interest payable on such next succeeding Business Day.

Section 9.    Affirmative Covenants.
The Company covenants that during the Issuance Period and so long as any of the
Notes are outstanding:
Section 9.1.    Compliance with Laws. Without limiting Section 10.4, the Company
will, and will cause each of its Subsidiaries to, comply with all laws,
ordinances or governmental rules or regulations to which each of them is
subject, including, without limitation, ERISA, Environmental Laws, the USA
PATRIOT Act and the other laws and regulations that are referred to in Section
5.16,

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Roanoke Gas Company        Private Shelf Agreement

and will obtain and maintain in effect all licenses, certificates, permits,
franchises and other governmental authorizations necessary to the ownership of
their respective properties or to the conduct of their respective businesses, in
each case to the extent necessary to ensure that non-compliance with such laws,
ordinances or governmental rules or regulations or failures to obtain or
maintain in effect such licenses, certificates, permits, franchises and other
governmental authorizations could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.
Section 9.2.    Insurance. The Company will, and will cause each of its
Subsidiaries to, maintain, with financially sound and reputable insurers,
insurance with respect to their respective properties and businesses against
such casualties and contingencies, of such types, on such terms and in such
amounts (including deductibles, co-insurance and self-insurance, if adequate
reserves are maintained with respect thereto) as is customary in the case of
entities of established reputations engaged in the same or a similar business
and similarly situated.
Section 9.3.    Maintenance of Properties. The Company will, and will cause each
of its Subsidiaries to, maintain and keep, or cause to be maintained and kept,
their respective properties in good repair, working order and condition (other
than ordinary wear and tear), so that the business carried on in connection
therewith may be properly conducted at all times, provided that this Section
shall not prevent the Company or any Subsidiary from discontinuing the operation
and the maintenance of any of its properties if such discontinuance is desirable
in the conduct of its business and the Company has concluded that such
discontinuance could not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect.
Section 9.4.    Payment of Taxes and Claims. The Company will, and will cause
each of its Subsidiaries to, file all tax returns required to be filed in any
jurisdiction and to pay and discharge all taxes shown to be due and payable on
such returns and all other taxes, assessments, governmental charges, or levies
imposed on them or any of their properties, assets, income or franchises, to the
extent the same have become due and payable and before they have become
delinquent and all claims for which sums have become due and payable that have
or might become a Lien on properties or assets of the Company or any Subsidiary,
provided that neither the Company nor any Subsidiary need pay any such tax,
assessment, charge, levy or claim if (i) the amount, applicability or validity
thereof is contested by the Company or such Subsidiary on a timely basis in good
faith and in appropriate proceedings, and the Company or a Subsidiary has
established adequate reserves therefor in accordance with GAAP on the books of
the Company or such Subsidiary or (ii) the nonpayment of all such taxes,
assessments, charges, levies and claims could not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect.
Section 9.5.    Corporate Existence, Etc. Subject to Section 10.2, the Company
will at all times preserve and keep its corporate existence in full force and
effect. Subject to Sections 10.2 and 10.7 the Company will at all times preserve
and keep in full force and effect the corporate existence of each of its
Subsidiaries (unless merged into the Company or a Wholly-Owned Subsidiary) and
all rights and franchises of the Company and its Subsidiaries unless, in the
good faith judgment of the Company, the termination of or failure to preserve
and keep in full force and

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effect such corporate existence, right or franchise could not, individually or
in the aggregate, have a Material Adverse Effect.
Section 9.6.    Books and Records. The Company will, and will cause each of its
Subsidiaries to, maintain proper books of record and account in conformity with
GAAP and all applicable requirements of any Governmental Authority having legal
or regulatory jurisdiction over the Company or such Subsidiary, as the case may
be. The Company will, and will cause each of its Subsidiaries to, keep books,
records and accounts which, in reasonable detail, accurately reflect all
transactions and dispositions of assets. The Company and its Subsidiaries have
devised a system of internal accounting controls sufficient to provide
reasonable assurances that their respective books, records, and accounts
accurately reflect all transactions and dispositions of assets and the Company
will, and will cause each of its Subsidiaries to, continue to maintain such
system.
Section 9.7.    Subsidiary Guarantors. The Company will cause each of its
Subsidiaries that guarantees or otherwise becomes liable at any time, whether as
a borrower or an additional or co-borrower or otherwise, for or in respect of
any Indebtedness under any Material Credit Facility to concurrently therewith:
(a)    enter into an agreement in form and substance reasonably satisfactory to
the Required Holders providing for the guaranty by such Subsidiary, on a joint
and several basis with all other such Subsidiaries, of (i) the prompt payment in
full when due of all amounts payable by the Company pursuant to the Notes
(whether for principal, interest, Make-Whole Amount or otherwise) and this
Agreement, including, without limitation, all indemnities, fees and expenses
payable by the Company thereunder and (ii) the prompt, full and faithful
performance, observance and discharge by the Company of each and every covenant,
agreement, undertaking and provision required pursuant to the Notes or this
Agreement to be performed, observed or discharged by it (a “Subsidiary
Guaranty”); and
(b)    deliver the following to each of holder of a Note:
(i)    an executed counterpart of such Subsidiary Guaranty;
(ii)    a certificate signed by an authorized responsible officer of such
Subsidiary providing the guaranty containing representations and warranties on
behalf of such Subsidiary to the same effect, mutatis mutandis, as those
contained in Sections 5.1, 5.2, 5.6 and 5.7 of this Agreement (but with respect
to such Subsidiary and such Subsidiary Guaranty rather than the Company);
(iii)    all documents as may be reasonably requested by the Required Holders to
evidence the due organization, continuing existence and good standing of such
Subsidiary and the due authorization by all requisite action on the part of such
Subsidiary of the execution and delivery of such Subsidiary Guaranty and the
performance by such Subsidiary of its obligations thereunder; and

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Roanoke Gas Company        Private Shelf Agreement

(iv)    an opinion of counsel reasonably satisfactory to the Required Holders
covering such matters relating to such Subsidiary and such Subsidiary Guaranty
as the Required Holders may reasonably request.
Section 10.    Negative Covenants.
The Company covenants that during the Issuance Period and so long as any of the
Notes are outstanding:
Section 10.1.    Transactions with Affiliates. The Company will not and will not
permit any Subsidiary to enter into directly or indirectly any transaction or
group of related transactions (including without limitation the purchase, lease,
sale or exchange of properties of any kind or the rendering of any service) with
any Affiliate (other than the Company or another Subsidiary), except in the
ordinary course and pursuant to the reasonable requirements of the Company’s or
such Subsidiary’s business and upon fair and reasonable terms no less favorable
to the Company or such Subsidiary than would be obtainable in a comparable
arm’s-length transaction with a Person not an Affiliate. This Section 10.1 shall
not restrict reasonable compensation, including equity incentive compensation,
to officers, employees or directors in connection with services rendered to the
company or any Subsidiary in such capacity.
Section 10.2.    Merger, Consolidation, Etc. The Company will not consolidate
with or merge with any other Person or convey, transfer or lease all or
substantially all of its assets in a single transaction or series of
transactions to any Person unless:
(a)    the successor formed by such consolidation or the survivor of such merger
or the Person that acquires by conveyance, transfer or lease all or
substantially all of the assets of the Company as an entirety, as the case may
be, shall be a solvent corporation or limited liability company organized and
existing under the laws of the United States or any state thereof (including the
District of Columbia), and, if the Company is not such corporation or limited
liability company, (i) such corporation or limited liability company shall have
executed and delivered to each holder of any Notes its assumption of the due and
punctual performance and observance of each covenant and condition of this
Agreement and the Notes and (ii) such corporation or limited liability company
shall have caused to be delivered to each holder of any Notes an opinion of
nationally recognized independent counsel, or other independent counsel
reasonably satisfactory to the Required Holders, to the effect that all
agreements or instruments effecting such assumption are enforceable in
accordance with their terms and comply with the terms hereof;
(b)    each Subsidiary Guarantor under any Subsidiary Guaranty that is
outstanding at the time such transaction or each transaction in such a series of
transactions occurs, reaffirms its obligations under such Subsidiary Guaranty in
writing at such time pursuant to documentation that is reasonably acceptable to
the Required Holders; and
(c)    immediately before and immediately after giving effect to such
transaction or each transaction in any such series of transactions, no Default
or Event of Default shall have occurred and be continuing.

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Roanoke Gas Company        Private Shelf Agreement

No such conveyance, transfer or lease of substantially all of the assets of the
Company shall have the effect of releasing the Company or any successor
corporation or limited liability company that shall theretofore have become such
in the manner prescribed in this Section 10.2 from its liability under this
Agreement or the Notes.
Section 10.3.    Line of Business. The Company will not and will not permit any
Subsidiary to engage in any business if, as a result, the general nature of the
business in which the Company and its Subsidiaries, taken as a whole, would then
be engaged would be substantially changed from the general nature of the
business in which the Company and its Subsidiaries, taken as a whole, are
engaged on the date of this Agreement.
Section 10.4.    Terrorism Sanctions Regulations. The Company will not and will
not permit any Controlled Entity (a) to become (including by virtue of being
owned or controlled by a Blocked Person), own or control a Blocked Person or any
Person that is the target of sanctions imposed by the United Nations or by the
European Union, or (b) directly or indirectly to have any investment in or
engage in any dealing or transaction (including, without limitation, any
investment, dealing or transaction involving the proceeds of the Notes) with any
Person if such investment, dealing or transaction (i) would cause any holder to
be in violation of any law or regulation applicable to such holder, or (ii) is
prohibited by or subject to sanctions under any U.S. Economic Sanctions, or (c)
to engage, nor shall any Affiliate of either engage, in any activity that could
subject such Person or any holder to sanctions under CISADA or any similar law
or regulation with respect to Iran or any other country that is subject to U.S.
Economic Sanctions.
Section 10.5.    Liens. The Company will not and will not permit any of its
Subsidiaries to directly or indirectly create, incur, assume or permit to exist
(upon the happening of a contingency or otherwise) any Lien on or with respect
to any property or asset (including, without limitation, any document or
instrument in respect of goods or accounts receivable) of the Company or any
such Subsidiary, whether now owned or held or hereafter acquired, or any income
or profits therefrom, or assign or otherwise convey any right to receive income
or profits, except:
(a)    Liens for taxes, assessments or other governmental charges which are not
yet due and payable or the payment of which is not at the time required by
Section 9.4;
(b)    statutory Liens of landlords and Liens of carriers, warehousemen,
mechanics, materialmen and other similar Liens, in each case, incurred in the
ordinary course of business for sums not yet due and payable or the payment of
which is not at the time required by Section 9.4;
(c)    Liens (other than any Liens imposed by ERISA) incurred or deposits made
in the ordinary course of business (i) in connection with workers’ compensation,
unemployment insurance and other types of social security or retirement
benefits, or (ii) to secure (or obtain letters of credit that secure) the
performance of tenders, statutory obligations, surety bonds, appeal bonds, bids,
leases (other than Capital Leases), performance bonds, purchase, construction or
sales contracts and other similar obligations, in each case not incurred or made
in connection with the borrowing of money, the obtaining of advances or credit
for the payment of the deferred purchase price of property;

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(d)    any attachment or judgment Lien, unless the judgment it secures shall
not, within 60 days after the entry thereof, have been discharged or execution
thereof stayed pending appeal, or shall not have been discharged within 60 days
after the expiration of any such stay;
(e)    leases or subleases granted to others, easements, rights-of-way,
restrictions and other similar charges or encumbrances, in each case incidental
to, and not interfering with, the ordinary conduct of the business of the
Company or any of its Subsidiaries, provided that such Liens do not, in the
aggregate, materially detract from the value of such property;
(f)    Liens on property or assets of a Subsidiary to the Company or to another
Subsidiary;
(g)    Liens existing on the date of this Agreement and that secure Indebtedness
of the Company or any of its Subsidiaries described in Schedule 5.15;
(h)    any Lien created after the date hereof to secure all or any part of the
purchase price, or to secure Indebtedness incurred or assumed to pay all or any
part of the purchase price or cost of construction or improvement, of fixed
assets useful and intended to be used in carrying on the business of the Company
or a Subsidiary (including pursuant to a Capital Lease or a Synthetic Lease),
provided that
(i)    any such Lien shall extend solely to the item or items of such property
(or improvement thereon) so acquired or constructed and, if required by the
terms of the instrument originally creating such Lien, other property (or
improvement thereon) which is an improvement to or is acquired for specific use
in connection with such acquired or constructed property (or improvement
thereon) or which is real property being improved by such acquired or
constructed property (or improvement thereon),
(ii)    the principal amount of the Indebtedness secured by any such Lien shall
at no time exceed an amount equal to 100% of the lesser of cost or fair market
value (as determined in good faith by the board of directors of the Company) of
such property (or improvement thereon) at the time of such acquisition or
construction, and
(iii)    any such Lien shall be created contemporaneously with or within the
period ending 180 days after, the acquisition or construction of such property;
(i)    any Lien existing on property of a Person immediately prior to its being
consolidated with or merged into the Company or a Subsidiary, or any Lien
existing on any property acquired by the Company or any Subsidiary at the time
such property is so acquired (whether or not the Indebtedness secured thereby
shall have been assumed), provided that (i) no such Lien shall have been created
or assumed in contemplation of such consolidation or merger or such Person’s
becoming a Subsidiary or such acquisition of property, and (ii) each such Lien
on property so acquired shall extend solely to the item or items of property

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Roanoke Gas Company        Private Shelf Agreement

so acquired and, if required by the terms of the instrument originally creating
such Lien, other property which is an improvement to or is acquired for specific
use in connection with such acquired property; and
(j)    other Liens not otherwise permitted by paragraphs (a) through (i)
securing Indebtedness of the Company or a Subsidiary, provided that the
Indebtedness secured thereby is permitted by Section 10.6, and provided,
further, that notwithstanding the foregoing, the Company shall not, and shall
not permit any of its Subsidiaries to, secure pursuant to this Section 10.5(j)
any Indebtedness outstanding under or pursuant to any Material Credit Facility
unless and until the Notes (and any guaranty delivered in connection therewith)
shall concurrently be secured equally and ratably with such Indebtedness
pursuant to documentation reasonably acceptable to the Required Holders in
substance and in form, including, without limitation, an intercreditor agreement
and opinions of counsel to the Company and/or any such Subsidiary, as the case
may be, from counsel that is reasonably acceptable to the Required Holders.
Section 10.6.    Financial Covenants.
(a)    Limitations on Long Term Debt. The Company shall not at any time permit
Consolidated Long Term Debt plus current maturities of Consolidated Long Term
Debt to exceed 65% of Consolidated Total Capitalization.
(b)    Limitation on Priority Indebtedness. The Company will not at any time
permit Priority Indebtedness to exceed 15% of Consolidated Total Assets.
Section 10.7.    Sale of Assets, Etc. The Company will not, and will not permit
any of its Subsidiaries to, make any Asset Disposition unless:
(a)    in the good faith opinion of the Company or Subsidiary making the Asset
Disposition, the Asset Disposition is in exchange for consideration having a
fair market value at least equal to that of the property exchanged;
(b)    immediately before and after giving effect to the Asset Disposition, no
Default or Event of Default shall have occurred and be continuing; and
(c)    the sum of (i) the Disposition Value of the property subject to such
Asset Disposition, plus (ii) the aggregate Disposition Value for all other
property that was the subject of an Asset Disposition during the period of 365
days immediately preceding such Asset Disposition would not exceed 10% of
Consolidated Total Assets determined as of the end of the most recently ended
calendar month preceding such Asset Disposition.
To the extent that the Net Proceeds Amount consisting of cash for any Transfer
to a Person other than an Affiliate of the Company or Subsidiary is applied to a
Indebtedness Prepayment Application or applied to a Property Reinvestment
Application within one year after such Transfer, then such Transfer (or, if less
than all such Net Proceeds Amount is applied as contemplated hereinabove, the
pro rata percentage thereof which corresponds to the Net Proceeds Amount so
applied), only for

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Roanoke Gas Company        Private Shelf Agreement

the purpose of determining compliance with subsection (c) of this Section 10.7
as of any date, shall be deemed not to be an Asset Disposition.
Section 11.    Events of Default.
An “Event of Default” shall exist if any of the following conditions or events
shall occur and be continuing:
(a)    the Company defaults in the payment of any principal or Make-Whole
Amount, if any, on any Note when the same becomes due and payable, whether at
maturity or at a date fixed for prepayment or by declaration or otherwise; or
(b)    the Company defaults in the payment of any interest on any Note for more
than five Business Days after the same becomes due and payable; or
(c)    the Company defaults in the performance of or compliance with any term
contained in Section 7.1(e), Section 10.2, Section 10.3, Section 10.4, Section
10.6 or Section 10.7; or
(d)    (i) the Company defaults in the performance of or compliance with any
term contained herein, (ii) the Parent Guarantor defaults in the performance of
or compliance with any term contained in the Parent Guaranty or (iii) any
Subsidiary Guarantor defaults in the performance of or compliance with any term
contained in its Subsidiary Guaranty (in each case other than those referred to
in Sections 11(a), (b) and (c)) and such default is not remedied within 30 days
after the earlier of (i) a Responsible Officer obtaining actual knowledge of
such default and (ii) the Company receiving written notice of such default from
any holder of a Note (any such written notice to be identified as a “notice of
default” and to refer specifically to this Section 11(d)); or
(e)    (i) any representation or warranty made in writing by or on behalf of the
Company or by any officer of the Company in this Agreement or any writing
furnished in connection with the transactions contemplated hereby proves to have
been false or incorrect in any material respect on the date as of which made, or
(ii) any representation or warranty made in writing by or on behalf of any
Subsidiary Guarantor or by any officer of such Subsidiary Guarantor in any
Subsidiary Guaranty or any writing furnished in connection with such Subsidiary
Guaranty proves to have been false or incorrect in any material respect on the
date as of which made, or (iii) any representation or warranty made in writing
by or on behalf of Parent Guarantor or by any officer of Parent Guarantor in the
Parent Guaranty or any writing furnished in connection with the Parent Guaranty
proves to have been false or incorrect in any material respect on the date as of
which made; or
(f)    (i) the Company, the Parent Guarantor or any Subsidiary is in default (as
principal or as guarantor or other surety) in the payment of any principal of or
premium or make-whole amount or interest on any Indebtedness that is outstanding
in an aggregate principal amount of at least $5,000,000 beyond any period of
grace provided with respect thereto, or (ii) the Company, the Parent Guarantor
or any Subsidiary is in default in the

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Roanoke Gas Company        Private Shelf Agreement

performance of or compliance with any term of any evidence of any Indebtedness
in an aggregate outstanding principal amount of at least $5,000,000 or of any
mortgage, indenture or other agreement relating thereto or any other condition
exists, and as a consequence of such default or condition such Indebtedness has
become, or has been declared (or one or more Persons are entitled to declare
such Indebtedness to be), due and payable before its stated maturity or before
its regularly scheduled dates of payment; or
(g)    the Company, the Parent Guarantor or any Subsidiary (i) is generally not
paying, or admits in writing its inability to pay, its debts as they become due,
(ii) files, or consents by answer or otherwise to the filing against it of, a
petition for relief or reorganization or arrangement or any other petition in
bankruptcy, for liquidation or to take advantage of any bankruptcy, insolvency,
reorganization, moratorium or other similar law of any jurisdiction, (iii) makes
an assignment for the benefit of its creditors generally, (iv) consents to the
appointment of a custodian, receiver, trustee or other officer with similar
powers with respect to it or with respect to any substantial part of its
property, (v) is adjudicated as insolvent or to be liquidated, or (vi) takes
corporate action for the purpose of any of the foregoing; or
(h)    a court or other Governmental Authority of competent jurisdiction enters
an order appointing, without consent by the Company, the Parent Guarantor or any
of their Subsidiaries, a custodian, receiver, trustee or other officer with
similar powers with respect to it or with respect to any substantial part of its
property, or constituting an order for relief or approving a petition for relief
or reorganization or any other petition in bankruptcy or for liquidation or to
take advantage of any bankruptcy or insolvency law of any jurisdiction, or
ordering the dissolution, winding-up or liquidation of the Company, the Parent
Guarantor or any of their Subsidiaries, or any such petition shall be filed
against the Company, the Parent Guarantor or any of their Subsidiaries and such
petition shall not be dismissed within 60 days; or
(i)    one or more final judgments or orders for the payment of money
aggregating in excess of $5,000,000, including, without limitation, any such
final order enforcing a binding arbitration decision, are rendered against one
or more of the Parent Guarantor, the Company or its Subsidiaries and which
judgments are not, within 30 days after entry thereof, bonded, discharged or
stayed pending appeal, or are not discharged within 30 days after the expiration
of such stay;
(j)    if (i) any Plan shall fail to satisfy the minimum funding standards of
ERISA or the Code for any plan year or part thereof or a waiver of such
standards or extension of any amortization period is sought or granted under
section 412 of the Code, (ii) a notice of intent to terminate any Plan shall
have been or is reasonably expected to be filed with the PBGC or the PBGC shall
have instituted proceedings under ERISA section 4042 to terminate or appoint a
trustee to administer any Plan or the PBGC shall have notified the Company or
any ERISA Affiliate that a Plan may become a subject of any such proceedings,
(iii) the aggregate “amount of unfunded benefit liabilities” (within the meaning
of section 4001(a)(18) of ERISA) under all Plans, determined in accordance with
Title IV of ERISA, shall

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Roanoke Gas Company        Private Shelf Agreement

exceed an amount that could reasonably be expected to have a Material Adverse
Effect, (iv) the Company or any ERISA Affiliate shall have incurred or is
reasonably expected to incur any liability pursuant to Title I or IV of ERISA or
the penalty or excise tax provisions of the Code relating to employee benefit
plans, (v) the Company or any ERISA Affiliate withdraws from any Multiemployer
Plan, or (vi) the Company or any Subsidiary establishes or amends any employee
welfare benefit plan that provides post-employment welfare benefits in a manner
that would increase the liability of the Company or any Subsidiary thereunder;
and any such event or events described in clauses (i) through (vi) above, either
individually or together with any other such event or events, could reasonably
be expected to have a Material Adverse Effect. As used in this Section 11(j),
the terms “employee benefit plan” and “employee welfare benefit plan” shall have
the respective meanings assigned to such terms in section 3 of ERISA; or
(k)    the Parent Guaranty or any Subsidiary Guaranty shall cease to be in full
force and effect, the Parent Guarantor or any Subsidiary Guarantor or any Person
acting on behalf of the Parent Guarantor or any Subsidiary Guarantor shall
contest in any manner the validity, binding nature or enforceability of the
Parent Guaranty or any Subsidiary Guaranty, or the obligations of the Parent
Guarantor or any Subsidiary Guarantor under the Parent Guaranty or any
Subsidiary Guaranty are not or cease to be legal, valid, binding and enforceable
in accordance with the terms of such Parent Guaranty and/or Subsidiary Guaranty.
Section 12.    Remedies on Default, Etc.
Section 12.1.    Acceleration. (a) If an Event of Default with respect to the
Company described in Section 11(g) or (h) (other than an Event of Default
described in clause (i) of Section 11(g) or described in clause (vi) of
Section 11(g) by virtue of the fact that such clause encompasses clause (i) of
Section 11(g)) has occurred, all the Notes then outstanding shall automatically
become immediately due and payable.
(a)    If any other Event of Default has occurred and is continuing, the
Required Holders may at any time at its or their option, by notice or notices to
the Company, declare all the Notes then outstanding to be immediately due and
payable.
(b)    If any Event of Default described in Section 11(a) or (b) has occurred
and is continuing, any holder or holders of Notes at the time outstanding
affected by such Event of Default may at any time, at its or their option, by
notice or notices to the Company, declare all the Notes held by it or them to be
immediately due and payable.
Upon any Notes becoming due and payable under this Section 12.1, whether
automatically or by declaration, such Notes will forthwith mature and the entire
unpaid principal amount of such Notes, plus (x) all accrued and unpaid interest
thereon (including, but not limited to, interest accrued thereon at the Default
Rate) and (y) the Make-Whole Amount determined in respect of such principal
amount (to the full extent permitted by applicable law), shall all be
immediately due and payable, in each and every case without presentment, demand,
protest or further notice, all of which are hereby waived. The Company
acknowledges, and the parties hereto agree, that each holder of a Note has the
right to maintain its investment in the Notes free from repayment by the Company

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Roanoke Gas Company        Private Shelf Agreement

(except as herein specifically provided for) and that the provision for payment
of a Make-Whole Amount by the Company in the event that the Notes are prepaid or
are accelerated as a result of an Event of Default, is intended to provide
compensation for the deprivation of such right under such circumstances.
Section 12.2.    Other Remedies. If any Default or Event of Default has occurred
and is continuing, and irrespective of whether any Notes have become or have
been declared immediately due and payable under Section 12.1, the holder of any
Note at the time outstanding may proceed to protect and enforce the rights of
such holder by an action at law, suit in equity or other appropriate proceeding,
whether for the specific performance of any agreement contained herein or in any
Note, the Parent Guaranty or any Subsidiary Guaranty, or for an injunction
against a violation of any of the terms hereof or thereof, or in aid of the
exercise of any power granted hereby or thereby or by law or otherwise.
Section 12.3.    Rescission. At any time after any Notes have been declared due
and payable pursuant to Section 12.1(b) or (c), the Required Holders (in the
case of a declaration pursuant to Section 12.1(b)) or any holder who has made
the declaration (in the case of a declaration pursuant to Section 12.1(c)), by
written notice to the Company, may rescind and annul any such declaration and
its consequences if (a) the Company has paid all overdue interest on the Notes,
all principal of and Make-Whole Amount, if any, on any Notes that are due and
payable and are unpaid other than by reason of such declaration, and all
interest on such overdue principal and Make-Whole Amount, if any, and (to the
extent permitted by applicable law) any overdue interest in respect of the
Notes, at the Default Rate, (b) neither the Company nor any other Person shall
have paid any amounts which have become due solely by reason of such
declaration, (c) all Events of Default and Defaults, other than non-payment of
amounts that have become due solely by reason of such declaration, have been
cured or have been waived pursuant to Section 17, and (d) no judgment or decree
has been entered for the payment of any monies due pursuant hereto or to the
Notes. No rescission and annulment under this Section 12.3 will extend to or
affect any subsequent Event of Default or Default or impair any right consequent
thereon.
Section 12.4.    No Waivers or Election of Remedies, Expenses, Etc. No course of
dealing and no delay on the part of any holder of any Note in exercising any
right, power or remedy shall operate as a waiver thereof or otherwise prejudice
such holder’s rights, powers or remedies. No right, power or remedy conferred by
this Agreement, the Parent Guaranty, any Subsidiary Guaranty or any Note upon
any holder thereof shall be exclusive of any other right, power or remedy
referred to herein or therein or now or hereafter available at law, in equity,
by statute or otherwise. Without limiting the obligations of the Company under
Section 15, the Company will pay to the holder of each Note on demand such
further amount as shall be sufficient to cover all costs and expenses of such
holder incurred in any enforcement or collection under this Section 12,
including, without limitation, reasonable attorneys’ fees, expenses and
disbursements.
Section 13.    Registration; Exchange; Substitution of Notes.
Section 13.1.    Registration of Notes. The Company shall keep at its principal
executive office a register for the registration and registration of transfers
of Notes. The name and address of each holder of one or more Notes, each
transfer thereof and the name and address of each transferee

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Roanoke Gas Company        Private Shelf Agreement

of one or more Notes shall be registered in such register. If any holder of one
or more Notes is a nominee, then (a) the name and address of the beneficial
owner of such Note or Notes, if known to the Company, shall also be registered
in such register as an owner and holder thereof and (b) at any such beneficial
owner’s option, either such beneficial owner or its nominee may execute any
amendment, waiver or consent pursuant to this Agreement. Prior to due
presentment for registration of transfer, the Person(s) in whose name any
Note(s) shall be registered shall be deemed and treated as the owner and holder
thereof for all purposes hereof, and the Company shall not be affected by any
notice or knowledge to the contrary. The Company shall give to any holder of a
Note that is an Institutional Investor promptly upon request therefor, a
complete and correct copy of the names and addresses of all registered holders
of Notes.
Section 13.2.    Transfer and Exchange of Notes. Upon surrender of any Note to
the Company at the address and to the attention of the designated officer (all
as specified in Section 18(iii)), for registration of transfer or exchange (and
in the case of a surrender for registration of transfer accompanied by a written
instrument of transfer duly executed by the registered holder of such Note or
such holder’s attorney duly authorized in writing and accompanied by the
relevant name, address and other information for notices of each transferee of
such Note or part thereof), within ten Business Days thereafter, the Company
shall execute and deliver, at the Company’s expense (except as provided below),
one or more new Notes (as requested by the holder thereof) of the same Series as
such surrendered Note in exchange therefor, in an aggregate principal amount
equal to the unpaid principal amount of the surrendered Note. Each such new Note
shall be payable to such Person as such holder may request and shall be
substantially in the form of Schedule 2.3. Each such new Note shall be dated and
bear interest from the date to which interest shall have been paid on the
surrendered Note or dated the date of the surrendered Note if no interest shall
have been paid thereon. The Company may require payment of a sum sufficient to
cover any stamp tax or governmental charge imposed in respect of any such
transfer of Notes. Notes shall not be transferred in denominations of less than
$100,000, provided that if necessary to enable the registration of transfer by a
holder of its entire holding of Notes, one Note may be in a denomination of less
than $100,000. Any transferee, by its acceptance of a Note registered in its
name (or the name of its nominee), shall be deemed to have made the
representation set forth in Section 6.2.
Section 13.3.    Replacement of Notes. Upon receipt by the Company at the
address and to the attention of the designated officer (all as specified in
Section 18(iii)) of evidence reasonably satisfactory to it of the ownership of
and the loss, theft, destruction or mutilation of any Note (which evidence shall
be, in the case of an Institutional Investor, notice from such Institutional
Investor of such ownership and such loss, theft, destruction or mutilation), and
(a)    in the case of loss, theft or destruction, of indemnity reasonably
satisfactory to it (provided that if the holder of such Note is, or is a nominee
for, an original Purchaser or another holder of a Note with a minimum net worth
of at least $25,000,000 or a Qualified Institutional Buyer, such Person’s own
unsecured agreement of indemnity shall be deemed to be satisfactory), or
(b)    in the case of mutilation, upon surrender and cancellation thereof,

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Roanoke Gas Company        Private Shelf Agreement

within ten Business Days thereafter, the Company at its own expense shall
execute and deliver, in lieu thereof, a new Note of the same Series as such
lost, stolen, destroyed or mutilated Note, dated and bearing interest from the
date to which interest shall have been paid on such lost, stolen, destroyed or
mutilated Note or dated the date of such lost, stolen, destroyed or mutilated
Note if no interest shall have been paid thereon.
Section 14.    Payments on Notes. So long as any Purchaser or its nominee shall
be the holder of any Note, the Company will pay all sums becoming due on such
Note for principal, Make-Whole Amount, if any, interest and all other amounts
becoming due hereunder by wire transfer in accordance with wiring instructions
specified for such purpose by such Purchaser under the related Confirmation of
Acceptance, or by such other method or at such other address as such Purchaser
shall have from time to time specified to the Company in writing for such
purpose, without the presentation or surrender of such Note or the making of any
notation thereon, except that upon written request of the Company made
concurrently with or reasonably promptly after payment or prepayment in full of
any Note, such Purchaser shall surrender such Note for cancellation, reasonably
promptly after any such request, to the Company at its principal executive
office. Prior to any sale or other disposition of any Note held by a Purchaser
or its nominee, such Purchaser will, at its election, either endorse thereon the
amount of principal paid thereon and the last date to which interest has been
paid thereon or surrender such Note to the Company in exchange for a new Note or
Notes pursuant to Section 13.2. The Company will afford the benefits of this
Section 14 to any Institutional Investor that is the direct or indirect
transferee of any Note purchased by a Purchaser under this Agreement and that
has made the same agreement relating to such Note as the Purchasers have made in
this Section 14.
Section 15.    Expenses, Etc.
Section 15.1.    Transaction Expenses. Whether or not the transactions
contemplated hereby are consummated, the Company will pay all costs and expenses
(including reasonable attorneys’ fees of a special counsel and, if reasonably
required by the Required Holders, local or other counsel) incurred by the
Purchasers and each other holder of a Note in connection with such transactions
and in connection with any amendments, waivers or consents under or in respect
of this Agreement, the Parent Guaranty, any Subsidiary Guaranty or the Notes
(whether or not such amendment, waiver or consent becomes effective), including,
without limitation: (a) the costs and expenses incurred in enforcing or
defending (or determining whether or how to enforce or defend) any rights under
this Agreement, the Parent Guaranty, any Subsidiary Guaranty or the Notes or in
responding to any subpoena or other legal process or informal investigative
demand issued in connection with this Agreement, the Parent Guaranty, any
Subsidiary Guaranty or the Notes, or by reason of being a holder of any Note,
(b) the costs and expenses, including financial advisors’ fees, incurred in
connection with the insolvency or bankruptcy of the Company or any Subsidiary or
in connection with any work-out or restructuring of the transactions
contemplated hereby and by the Notes, the Parent Guaranty and any Subsidiary
Guaranty and (c) the costs and expenses incurred in connection with the initial
filing of this Agreement and all related documents and financial information
with the SVO provided, that such costs and expenses under this clause (c) shall
not exceed $3,000 per Series of Notes. The Company will pay, and will save each
Purchaser and each other holder of a Note harmless from, (i) all claims in
respect of any fees, costs or expenses, if any,

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Roanoke Gas Company        Private Shelf Agreement

of brokers and finders (other than those, if any, retained by a Purchaser or
other holder in connection with its purchase of the Notes) and (ii) any and all
wire transfer fees that any bank deducts from any payment under such Note to
such holder or otherwise charges to a holder of a Note with respect to a payment
under such Note.
Section 15.2.    Survival. The obligations of the Company under this Section 15
will survive the payment or transfer of any Note, the enforcement, amendment or
waiver of any provision of this Agreement, the Parent Guaranty, any Subsidiary
Guaranty or the Notes, and the termination of this Agreement.
Section 16.    Survival of Representations and Warranties; Entire Agreement.
All representations and warranties contained herein shall survive the execution
and delivery of this Agreement and the Notes, the purchase or transfer by any
Purchaser of any Note or portion thereof or interest therein and the payment of
any Note, and may be relied upon by any subsequent holder of a Note, regardless
of any investigation made at any time by or on behalf of such Purchaser or any
other holder of a Note. All statements contained in any certificate or other
instrument delivered by or on behalf of the Company pursuant to this Agreement
shall be deemed representations and warranties of the Company under this
Agreement. Subject to the preceding sentence, this Agreement, the Notes and any
Subsidiary Guaranties embody the entire agreement and understanding between each
Purchaser and the Company and supersede all prior agreements and understandings
relating to the subject matter hereof.
Section 17.    Amendment and Waiver.
Section 17.1.    Requirements. This Agreement and the Notes may be amended, and
the observance of any term hereof or of the Notes may be waived (either
retroactively or prospectively), only with the written consent of the Company
and the Required Holders, except that:
(a)    no amendment or waiver of any of Sections 1, 2, 3, 4, 6 or 21 hereof, or
any defined term (as it is used therein), will be effective as to any Purchaser
unless consented to by such Purchaser in writing;
(b)    (i) with the written consent of Prudential (and without the consent of
any other holder of Notes), the provisions of Section 2 may be amended or waived
(except insofar as any such amendment or waiver would affect any rights or
obligations with respect to the purchase and sale of Notes which shall have
become Accepted Notes prior to such amendment or waiver), and (ii) with the
written consent of all of the Purchasers which shall have become obligated to
purchase Accepted Notes of any Series (and not without the written consent of
all such Purchasers), any of the provisions of Section 4 may be amended or
waived insofar as such amendment or waiver would affect only rights or
obligations with respect to the purchase and sale of the Accepted Notes of such
Series or the terms and provisions of such Accepted Notes;
(c)    no amendment or waiver may, without the written consent of each holder of
each Note at the time outstanding (or, if prior to the initial Closing, the
Purchasers), (i)

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Roanoke Gas Company        Private Shelf Agreement

subject to Section 12 relating to acceleration or rescission, change the amount
or time of any prepayment or payment of principal of, or reduce the rate or
change the time of payment or method of computation of (x) interest on the Notes
or (y) the Make-Whole Amount, (ii) change the percentage of the principal amount
of the Notes the holders of which are required to consent to any amendment or
waiver, or (iii) amend any of Sections 8 (except as set forth in the second
sentence of Section 8.2 and Section 17.1(c)), 11(a), 11(b), 12, 17 or 20; and
(d)    Section 8.5 may be amended or waived to permit offers to purchase made by
the Company or an Affiliate pro rata to the holders of all Notes at the time
outstanding upon the same terms and conditions only with the written consent of
the Company and the Super-Majority Holders.
Section 17.2.    Solicitation of Holders of Notes.
(a)    Solicitation. The Company will provide Prudential, each Purchaser and
each holder of a Note (irrespective of the amount of Notes then owned by it)
with sufficient information, sufficiently far in advance of the date a decision
is required, to enable such Purchaser and such holder to make an informed and
considered decision with respect to any proposed amendment, waiver or consent in
respect of any of the provisions hereof or of the Notes, the Parent Guaranty or
any Subsidiary Guaranty. The Company will deliver executed or true and correct
copies of each amendment, waiver or consent effected pursuant to this Section
17, the Parent Guaranty or any Subsidiary Guaranty to each Purchaser and each
holder of a Note promptly following the date on which it is executed and
delivered by, or receives the consent or approval of, the requisite Purchasers
or holders of Notes.
(b)    Payment. The Company will not directly or indirectly pay or cause to be
paid any remuneration, whether by way of supplemental or additional interest,
fee or otherwise, or grant any security or provide other credit support, to any
Purchaser or holder of a Note as consideration for or as an inducement to the
entering into by such Purchaser or such holder of any waiver or amendment of any
of the terms and provisions hereof, the Parent Guaranty or of any Subsidiary
Guaranty or any Note unless such remuneration is concurrently paid, or security
is concurrently granted or other credit support concurrently provided, on the
same terms, ratably to each Purchaser and each holder of a Note even if such
Purchaser or such holder did not consent to such waiver or amendment.
(c)    Consent in Contemplation of Transfer. Any consent given pursuant to this
Section 17, the Parent Guaranty or any Subsidiary Guaranty by a holder of a Note
that has transferred or has agreed to transfer its Note to the Company, any
Subsidiary or any Affiliate of the Company (either pursuant to a waiver under
Section 17.1(c) or subsequent to Section 8.5 having been amended pursuant to
Section 17.1(c)) in connection with such consent shall be void and of no force
or effect except solely as to such holder, and any amendments effected or
waivers granted or to be effected or granted that would not have been or would
not be so effected or granted but for such consent (and the consents of all
other holders of Notes that were acquired under the same or similar conditions)
shall be void and of no force or effect except solely as to such holder.

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Roanoke Gas Company        Private Shelf Agreement

Section 17.3.    Binding Effect, etc. Any amendment or waiver consented to as
provided in this Section 17, the Parent Guaranty or any Subsidiary Guaranty
applies equally to all Purchasers and holders of Notes and is binding upon them
and upon each future holder of any Note and upon the Company without regard to
whether such Note has been marked to indicate such amendment or waiver. No such
amendment or waiver will extend to or affect any obligation, covenant,
agreement, Default or Event of Default not expressly amended or waived or impair
any right consequent thereon. No course of dealing between the Company and any
Purchaser or holder of a Note and no delay in exercising any rights hereunder or
under any Note, the Parent Guaranty or Subsidiary Guaranty shall operate as a
waiver of any rights of any Purchaser or any holder of such Note.
Section 17.4.    Notes Held by Company, etc. Solely for the purpose of
determining whether the holders of the requisite percentage of the aggregate
principal amount of Notes then outstanding approved or consented to any
amendment, waiver or consent to be given under this Agreement, the Parent
Guaranty, any Subsidiary Guaranty or the Notes, or have directed the taking of
any action provided herein or in the Parent Guaranty, any Subsidiary Guaranty or
the Notes to be taken upon the direction of the holders of a specified
percentage of the aggregate principal amount of Notes then outstanding, Notes
directly or indirectly owned by the Company or any of its Affiliates shall be
deemed not to be outstanding.
Section 18.    Notices.
Except to the extent otherwise provided in Section 7.4, all notices and
communications provided for hereunder shall be in writing and sent (a) by
telecopy if the sender on the same day sends a confirming copy of such notice by
an internationally recognized overnight delivery service (charges prepaid), or
(b) by registered or certified mail with return receipt requested (postage
prepaid), or (c) by an internationally recognized overnight delivery service
(with charges prepaid). Any such notice must be sent:
(i)    if to any Purchaser or its nominee, to such Purchaser or nominee at the
address specified by such Purchaser in its Confirmation of Acceptance, or at
such other address as such Purchaser or nominee shall have specified to the
Company in writing,
(ii)    if to any other holder of any Note, to such holder at such address as
such other holder shall have specified to the Company in writing,
(iii)    if to the Company, to the Company at its address set forth at the
beginning hereof to the attention of “President, Roanoke Gas Company”, or at
such other address as the Company shall have specified to the holder of each
Note in writing or
(iv)    if to Prudential, to Prudential c/o Prudential Capital Group, 2200 Ross
Avenue, Suite 4300, Dallas, TX 75201, to the attention of Managing Director,
Energy Finance – Oil & Gas, or at such other address as Prudential shall have
specified to the Company in writing.

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Roanoke Gas Company        Private Shelf Agreement

Notices under this Section 18 will be deemed given only when actually received.
Notwithstanding anything to the contrary in this Section 18, any communication
pursuant to Section 2 shall be made by the method specified for such
communication in Section 2, and shall be effective to create any rights or
obligations under this Agreement only if, in the case of a telephone
communication, an Authorized Officer of the party conveying the information and
of the party receiving the information are parties to the telephone call, and in
the case of a telefacsimile communication, the communication is signed by an
Authorized Officer of the party conveying the information, addressed to the
attention of an Authorized Officer of the party receiving the information, and
in fact received at the telefacsimile terminal the number of which is listed for
the party receiving the communication in Schedule B or at such other
telefacsimile terminal as the party receiving the information shall have
specified in writing to the party sending such information and in the case of an
e-mail communication, the communication is transmitted by an Authorized Officer
of the party transmitting the information, addressed to the attention of an
Authorized Officer of the party receiving the information, and in fact received
at an e-mail address that is listed for the party receiving the e-mail
communication in Schedule B or at such other e-mail address as the party
receiving the information shall have specified in writing to the party sending
such information.
Section 19.    Reproduction of Documents.
This Agreement and all documents relating thereto, including, without
limitation, (a) consents, waivers and modifications that may hereafter be
executed, (b) documents received by any Purchaser at a Closing (except the Notes
themselves), and (c) financial statements, certificates and other information
previously or hereafter furnished to any Purchaser, may be reproduced by any
Purchaser by any photographic, photostatic, electronic, digital, or other
similar process and such Purchaser may destroy any original document so
reproduced. The Company agrees and stipulates that, to the extent permitted by
applicable law, any such reproduction shall be admissible in evidence as the
original itself in any judicial or administrative proceeding (whether or not the
original is in existence and whether or not such reproduction was made by any
Purchaser in the regular course of business) and any enlargement, facsimile or
further reproduction of such reproduction shall likewise be admissible in
evidence. This Section 19 shall not prohibit the Company or any other holder of
Notes from contesting any such reproduction to the same extent that it could
contest the original, or from introducing evidence to demonstrate the inaccuracy
of any such reproduction.
Section 20.    Confidential Information.
For the purposes of this Section 20, “Confidential Information” means
information delivered to any Purchaser by or on behalf of the Company or any
Subsidiary in connection with the transactions contemplated by or otherwise
pursuant to this Agreement that is proprietary in nature and that was clearly
marked or labeled or otherwise adequately identified when received by such
Purchaser as being confidential information of the Company or such Subsidiary,
provided that such term does not include information that (a) was publicly known
or otherwise known to such Purchaser prior to the time of such disclosure, (b)
subsequently becomes publicly known through no act or omission by such Purchaser
or any Person acting on such Purchaser’s behalf, (c) otherwise becomes known to
such Purchaser other than through disclosure by the Company or any Subsidiary or
(d) constitutes financial statements delivered to such Purchaser under Section
7.1 that are

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otherwise publicly available. Each Purchaser will maintain the confidentiality
of such Confidential Information in accordance with procedures adopted by such
Purchaser in good faith to protect confidential information of third parties
delivered to such Purchaser, provided that such Purchaser may deliver or
disclose Confidential Information to (i) its directors, officers, employees,
agents, attorneys, trustees and affiliates (to the extent such disclosure
reasonably relates to the administration of the investment represented by its
Notes), (ii) its auditors, financial advisors and other professional advisors
who agree to hold confidential the Confidential Information substantially in
accordance with this Section 20, (iii) any other holder of any Note, (iv) any
Institutional Investor to which it sells or offers to sell such Note or any part
thereof or any participation therein (if such Person has agreed in writing prior
to its receipt of such Confidential Information to be bound by this Section 20),
(v) any Person from which it offers to purchase any Security of the Company (if
such Person has agreed in writing prior to its receipt of such Confidential
Information to be bound by this Section 20), (vi) any federal or state
regulatory authority having jurisdiction over such Purchaser, (vii) the NAIC or
the SVO or, in each case, any similar organization, or any nationally recognized
rating agency that requires access to information about such Purchaser’s
investment portfolio, or (viii) any other Person to which such delivery or
disclosure may be necessary or appropriate (w) to effect compliance with any
law, rule, regulation or order applicable to such Purchaser, (x) in response to
any subpoena or other legal process, (y) in connection with any litigation to
which such Purchaser is a party or (z) if an Event of Default has occurred and
is continuing, to the extent such Purchaser may reasonably determine such
delivery and disclosure to be necessary or appropriate in the enforcement or for
the protection of the rights and remedies under such Purchaser’s Notes, this
Agreement, the Parent Guaranty or any Subsidiary Guaranty. Each holder of a
Note, by its acceptance of a Note, will be deemed to have agreed to be bound by
and to be entitled to the benefits of this Section 20 as though it were a party
to this Agreement. On reasonable request by the Company in connection with the
delivery to any holder of a Note of information required to be delivered to such
holder under this Agreement or requested by such holder (other than a holder
that is a party to this Agreement or its nominee), such holder will enter into
an agreement with the Company embodying this Section 20.
In the event that as a condition to receiving access to information relating to
the Company or its Subsidiaries in connection with the transactions contemplated
by or otherwise pursuant to this Agreement, any Purchaser or holder of a Note is
required to agree to a confidentiality undertaking (whether through IntraLinks,
another secure website, a secure virtual workspace or otherwise) which is
different from this Section 20, this Section 20 shall not be amended thereby
and, as between such Purchaser or such holder and the Company, this Section 20
shall supersede any such other confidentiality undertaking.
Each Purchaser acknowledges that U.S. securities laws prohibit any Person who
has received material non-public information about a company from purchasing or
selling securities of such company or from communicating such information to any
other person when it is reasonably foreseeable that such other person is likely
to purchase or sell such securities in reliance upon such information. Each
Purchaser further acknowledges that information provided to it by or on behalf
of the Company may contain material, non-public information concerning the
Company, its Subsidiaries or their Affiliates, or their securities, and each
Purchaser acknowledges that such Purchaser may be restricted by applicable law
from trading in the securities of the Company or its

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parent if it possess material non-public information concerning the Company or
its parent unless such trading is otherwise permitted or exempted by applicable
law.
Section 21.    Substitution of Purchaser.
Each Purchaser shall have the right to substitute any one of its Affiliates or
another Purchaser or any one of such other Purchaser’s Affiliates (a “Substitute
Purchaser”) as the purchaser of the Notes that it has agreed to purchase
hereunder, by written notice to the Company, which notice shall be signed by
both such Purchaser and such Substitute Purchaser, shall contain such Substitute
Purchaser’s agreement to be bound by this Agreement and shall contain a
confirmation by such Substitute Purchaser of the accuracy with respect to it of
the representations set forth in Section 6. Upon receipt of such notice, any
reference to such Purchaser in this Agreement (other than in this Section 21),
shall be deemed to refer to such Substitute Purchaser in lieu of such original
Purchaser. In the event that such Substitute Purchaser is so substituted as a
Purchaser hereunder and such Substitute Purchaser thereafter transfers to such
original Purchaser all of the Notes then held by such Substitute Purchaser, upon
receipt by the Company of notice of such transfer, any reference to such
Substitute Purchaser as a “Purchaser” in this Agreement (other than in this
Section 21), shall no longer be deemed to refer to such Substitute Purchaser,
but shall refer to such original Purchaser, and such original Purchaser shall
again have all the rights of an original holder of the Notes under this
Agreement.
Section 22.    Miscellaneous.
Section 22.1.    Successors and Assigns. All covenants and other agreements
contained in this Agreement by or on behalf of any of the parties hereto bind
and inure to the benefit of their respective successors and assigns (including,
without limitation, any subsequent holder of a Note) whether so expressed or
not.
Section 22.2.    Accounting Terms. All accounting terms used herein which are
not expressly defined in this Agreement have the meanings respectively given to
them in accordance with GAAP. Except as otherwise specifically provided herein,
(i) all computations made pursuant to this Agreement shall be made in accordance
with GAAP, and (ii) all financial statements shall be prepared in accordance
with GAAP. For purposes of determining compliance with this Agreement
(including, without limitation, Section 9, Section 10 and the definition of
“Indebtedness”), any election by the Company to measure any financial liability
using fair value (as permitted by Financial Accounting Standards Board
Accounting Standards Codification Topic No. 825-10-25 – Fair Value Option,
International Accounting Standard 39 – Financial Instruments: Recognition and
Measurement or any similar accounting standard) shall be disregarded and such
determination shall be made as if such election had not been made.
Section 22.3.    Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall (to the full extent permitted by law)
not invalidate or render unenforceable such provision in any other jurisdiction.

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Section 22.4.    Construction, etc. Each covenant contained herein shall be
construed (absent express provision to the contrary) as being independent of
each other covenant contained herein, so that compliance with any one covenant
shall not (absent such an express contrary provision) be deemed to excuse
compliance with any other covenant. Where any provision herein refers to action
to be taken by any Person, or which such Person is prohibited from taking, such
provision shall be applicable whether such action is taken directly or
indirectly by such Person.
Section 22.5.    Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original but all of which together shall
constitute one instrument. Each counterpart may consist of a number of copies
hereof, each signed by less than all, but together signed by all, of the parties
hereto.
Section 22.6.    Governing Law. This Agreement shall be construed and enforced
in accordance with, and the rights of the parties shall be governed by, the law
of the Commonwealth of Virginia excluding choice‑of‑law principles of the law of
such Commonwealth that would permit the application of the laws of a
jurisdiction other than such Commonwealth.
Section 22.7.    Jurisdiction and Process; Waiver of Jury Trial. (a) The Company
irrevocably submits to the non-exclusive jurisdiction of any Virginia State or
federal court sitting in the city of Roanoke, over any suit, action or
proceeding arising out of or relating to this Agreement or the Notes. To the
fullest extent permitted by applicable law, the Company irrevocably waives and
agrees not to assert, by way of motion, as a defense or otherwise, any claim
that it is not subject to the jurisdiction of any such court, any objection that
it may now or hereafter have to the laying of the venue of any such suit, action
or proceeding brought in any such court and any claim that any such suit, action
or proceeding brought in any such court has been brought in an inconvenient
forum.
(a)    The Company consents to process being served by or on behalf of any
holder of Notes in any suit, action or proceeding of the nature referred to in
Section 22.7(a) by mailing a copy thereof by registered or certified mail (or
any substantially similar form of mail), postage prepaid, return receipt
requested, to it at its address specified in Section 18 or at such other address
of which such holder shall then have been notified pursuant to said Section. The
Company agrees that such service upon receipt (i) shall be deemed in every
respect effective service of process upon it in any such suit, action or
proceeding and (ii) shall, to the fullest extent permitted by applicable law, be
taken and held to be valid personal service upon and personal delivery to it.
Notices hereunder shall be conclusively presumed received as evidenced by a
delivery receipt furnished by the United States Postal Service or any reputable
commercial delivery service.
(b)    Nothing in this Section 22.7 shall affect the right of any holder of a
Note to serve process in any manner permitted by law, or limit any right that
the holders of any of the Notes may have to bring proceedings against the
Company in the courts of any appropriate jurisdiction or to enforce in any
lawful manner a judgment obtained in one jurisdiction in any other jurisdiction.

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Roanoke Gas Company        Private Shelf Agreement

(c)    THE PARTIES HERETO HEREBY WAIVE TRIAL BY JURY IN ANY ACTION BROUGHT ON OR
WITH RESPECT TO THIS AGREEMENT, THE NOTES OR ANY OTHER DOCUMENT EXECUTED IN
CONNECTION HEREWITH OR THEREWITH.
Section 22.8.    Transaction References. The Company agrees that Prudential may
(i) refer to its role in establishing the Facility, as well as the identity of
the Company and the maximum aggregate principal amount of the Notes and the date
on which the Facility was established, on its internet site or in marketing
materials, press releases, published “tombstone” announcements or any other
print or electronic medium and (ii) display the Company’s corporate logo in
conjunction with any such reference.

* * * * *

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Roanoke Gas Company        Private Shelf Agreement

If you are in agreement with the foregoing, please sign the form of agreement on
a counterpart of this Agreement and return it to the Company, whereupon this
Agreement shall become a binding agreement between you and the Company.
 
Very truly yours,
ROANOKE GAS COMPANY

By: /s/ John S. D'Orazio   
   Name: John S. D’Orazio
   Title: President

By: /s/ Paul W. Nester      
   Name: Paul W. Nester
   Title: Chief Financial Officer

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Roanoke Gas Company        Private Shelf Agreement

This Agreement is hereby
accepted and agreed to as
of the date hereof.
 

PRUDENTIAL INVESTMENT MANAGEMENT, INC.

    
By: /s/ Brian Lemons     
Vice President

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SCHEDULE A

DEFINED TERMS
As used herein, the following terms have the respective meanings set forth below
or set forth in the Section hereof following such term:
“Acceptance” is defined in Section 2(f).
“Acceptance Day” is defined in Section 2(f).
“Acceptance Window” means, with respect to any interest rate quotes provided by
Prudential pursuant to Section 2(e), the time period designated by Prudential
during which the Company may elect to accept such interest rate quotes.
“Accepted Note” is defined in Section 2(f).
“Affiliate” means, at any time, (a) with respect to any Person, any other Person
that at such time directly or indirectly through one or more intermediaries
Controls, or is Controlled by, or is under common Control with, such first
Person, (b) with respect to the Company, shall include any Person beneficially
owning or holding, directly or indirectly, 10% or more of any class of voting or
equity interests of the Company or any Subsidiary or any Person of which the
Company and its Subsidiaries beneficially own or hold, in the aggregate,
directly or indirectly, 10% or more of any class of voting or equity interests
and (c) with respect to Prudential, shall include any managed account,
investment fund or other vehicle for which Prudential or any Prudential
Affiliate acts as investment advisor or portfolio manager. As used in this
definition, “Control” means the possession, directly or indirectly, of the power
to direct or cause the direction of the management and policies of a Person,
whether through the ownership of voting securities, by contract or otherwise.
Unless the context otherwise clearly requires, any reference to an “Affiliate”
is a reference to an Affiliate of the Company.
“Agreement” means this Private Shelf Agreement, including all Schedules attached
to this Agreement, as it may be amended, restated, supplemented or otherwise
modified from time to time among the Company, Prudential and the Purchasers
dated September 30, 2015.
“Anti-Corruption Laws” is defined in Section 5.16(d)(1).
“Anti-Money Laundering Laws” is defined in Section 5.16(c).
“Asset Disposition” means any Transfer except:
(a)    any Transfer from a Subsidiary to the Company or to a Wholly-Owned
Subsidiary so long as immediately before and immediately after the consummation
of any such Transfer and after giving effect thereto, no Default or Event of
Default would exist;

(b)    any Transfer made in the ordinary course of business and involving only
property that is either (1) held for lease or sale or (2) equipment, fixtures,
supplies or

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materials no longer required in the operation of the business of the Company or
any of its Subsidiaries or that is obsolete;

(c)    any Transfer of cash made in the ordinary course of business;    

(d)    any Transfer of cash or other property constituting a distribution or a
dividend, provided that no Default or Event of Default has occurred and is
occurring or would result therefrom; and

(e)    any grant of a Lien permitted pursuant to Section 10.5.

“Authorized Officer” means (i) in the case of the Company, its chief executive
officer, its chief financial officer, any other Person authorized by the Company
to act on behalf of the Company and designated as an “Authorized Officer” of the
Company in Schedule B attached hereto or any other Person authorized by the
Company to act on behalf of the Company and designated as an “Authorized
Officer” of the Company for the purpose of this Agreement in an Officer’s
Certificate executed by the Company’s chief executive officer or chief financial
officer and delivered to Prudential, and (ii) in the case of Prudential, any
officer of Prudential designated as its “Authorized Officer” in Schedule B or
any officer of Prudential designated as its “Authorized Officer” for the purpose
of this Agreement in a certificate executed by one of its Authorized Officers or
a lawyer in its law department. Any action taken under this Agreement on behalf
of the Company by any individual who on or after the date of this Agreement
shall have been an Authorized Officer of the Company and whom Prudential in good
faith believes to be an Authorized Officer of the Company at the time of such
action shall be binding on the Company even though such individual shall have
ceased to be an Authorized Officer of the Company, and any action taken under
this Agreement on behalf of Prudential by any individual who on or after the
date of this Agreement shall have been an Authorized Officer of Prudential and
whom the Company in good faith believes to be an Authorized Officer of
Prudential at the time of such action shall be binding on Prudential even though
such individual shall have ceased to be an Authorized Officer of Prudential.
“Available Facility Amount” is defined in Section 2(a).
“Blocked Person” is defined in Section 5.16(a).
“Business Day” means (a) for the purposes of Section 8.6 only, any day other
than a Saturday, a Sunday or a day on which commercial banks in New York City
are required or authorized to be closed, (b) for the purpose of Section 2.2
only, a day on which Prudential is open for business and (c) for the purposes of
any other provision of this Agreement, any day other than a Saturday, a Sunday
or a day on which commercial banks in New York, New York or Roanoke, Virginia,
are required or authorized to be closed.
“Cancellation Date” is defined in Section 2(h)(iv).
“Cancellation Fee” is defined in Section 2(h)(iv).

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“Capital Lease” means, at any time, a lease with respect to which the lessee is
required concurrently to recognize the acquisition of an asset and the
incurrence of a liability in accordance with GAAP.
“CISADA” means the Comprehensive Iran Sanctions, Accountability and Divestment
Act.
“Closing” is defined in Section 3.1.
“Closing Day” means with respect to any Accepted Note, the Business Day
specified for the closing of the purchase and sale of such Accepted Note in the
Confirmation of Acceptance for such Accepted Note, provided that (i) if the
Company and the Purchaser which is obligated to purchase such Accepted Note
agree on an earlier Business Day for such closing, the “Closing Day” for such
Accepted Note shall be such earlier Business Day, and (ii) if the closing of the
purchase and sale of such Accepted Note is rescheduled pursuant to Section 3.2,
the Closing Day for such Accepted Note, for all purposes of this Agreement
except references to “original Closing Day” in Section 2(h)(iii), shall mean the
Rescheduled Closing Day with respect to such Accepted Note.
“Code” means the Internal Revenue Code of 1986, as amended from time to time,
and the rules and regulations promulgated thereunder from time to time.
“Company” is defined in the first paragraph of this Agreement.
“Confidential Information” is defined in Section 20.
“Confirmation of Acceptance” is defined in Section 2(f).
“Consolidated Long Term Debt” means, as of the date of any determination
thereof, the total of all Long Term Debt of the Company and its Subsidiaries
outstanding on such date, after eliminating all offsetting debits and credits
between the Company and its Subsidiaries and all other items required to be
eliminated in the course of the preparation of consolidated financial statements
of the Company and its Subsidiaries in accordance with GAAP.
“Consolidated Stockholders’ Equity” means, as of the date of any determination
thereof, the stockholders’ equity of the Company which would be shown on a
consolidated balance sheet of the Company and its Subsidiaries as of such time
prepared in accordance with GAAP.
“Consolidated Total Assets” means, at any time, the total assets of the Company
which would be shown on a consolidated balance sheet of the Company and its
Subsidiaries as of such time prepared in accordance with GAAP.
“Consolidated Total Capitalization” means, as of the date of any determination
thereof, the sum of (i) Consolidated Long Term Debt, plus (ii) current
maturities of Consolidated Long Term Debt, plus (iii) Consolidated Stockholders’
Equity.
“Controlled Entity” means (i) any of the Subsidiaries of the Company and any of
their or the Company’s respective Controlled Affiliates and (ii) if the Company
has a parent company, such parent company and its Controlled Affiliates. As used
in this definition, “Control” means the

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possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of a Person, whether through the
ownership of voting securities, by contract or otherwise.
“Default” means an event or condition the occurrence or existence of which
would, with the lapse of time or the giving of notice or both, become an Event
of Default.
“Default Rate” means that rate of interest that is the greater of (i) 2.0% per
annum above the rate of interest stated in clause (a) of the first paragraph of
the Notes or (ii) 2.0% over the rate of interest publicly announced by Wells
Fargo Bank, National Association in New York, New York as its “base” or “prime”
rate.
“Delayed Delivery Fee” is defined in Section 2(h)(iii).
“Disclosure Documents” is defined in Section 5.3.
“Disposition Proceeds” means, in the case of any Asset Disposition, the
aggregate amount of Asset Disposition proceeds received by the Company in
respect of such Asset Disposition, net of (i) costs and expenses incurred by the
Company in connection with the enforcement, negotiation, consummation,
settlement, proceedings, administration or other activity related to such Asset
Disposition (including reasonable legal and accounting fees and expenses paid or
payable as a result thereof), (ii) any taxes payable in connection with such
Asset Disposition, (iii) amounts required to be applied to the repayment of
Indebtedness secured by a Lien on the properties or assets that were the subject
of such Asset Disposition, and (iv) any amounts to be set aside in any reserve
established in accordance with GAAP or any amount placed in escrow, in either
case for adjustment in respect of the sale price of such properties or assets,
for indemnification obligations of the Company in connection with such Asset
Disposition or for other liabilities associated with such Asset Disposition and
retained by the Company until such time as such reserve is reversed or such
escrow arrangement is terminated, in which case the Disposition Proceeds shall
include only the amount of the reserve so reversed or the amount returned to the
Company from such escrow arrangement, as the case may be.
“Disposition Value” means, at any time, with respect to any property:
(a)    in the case of property that does not constitute Subsidiary Stock, the
book value thereof, valued at the time of such disposition in good faith by the
Company, and
(b)    in the case of property that constitutes Subsidiary Stock, an amount
equal to that percentage of book value of the assets of the Subsidiary that
issued such Subsidiary Stock as is equal to the percentage that the book value
of such Subsidiary Stock represents of the book value of all of the outstanding
capital stock or similar equity interests of such Subsidiary (assuming, in
making such calculations, that all Securities convertible into such capital
stock or similar equity interests are so converted and giving full effect to all
transactions that would occur or be required in connection with such conversion)
determined at the time of the disposition thereof, in good faith by the Company.

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“EDGAR” means the SEC’s Electronic Data Gathering, Analysis and Retrieval System
or any successor SEC electronic filing system for such purposes.
“Environmental Laws” means any and all federal, state, local, and foreign
statutes, laws, regulations, ordinances, rules, judgments, orders, decrees,
permits, concessions, grants, franchises, licenses, agreements or governmental
restrictions relating to pollution and the protection of the environment or the
release of any materials into the environment, including but not limited to
those related to Hazardous Materials.
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended
from time to time, and the rules and regulations promulgated thereunder from
time to time in effect.
“ERISA Affiliate” means any trade or business (whether or not incorporated) that
is treated as a single employer together with the Company under section 414 of
the Code.
“Event of Default” is defined in Section 11.
“Exchange Act” means the Securities Exchange Act of 1934, as amended.
“Facility” is defined in Section 2(a).
“Fair Market Value” means, at any time and with respect to any property, the
sale of value of such property that would be realized in an arm’s‑length sale at
such time between an informed and willing buyer and an informed and willing
seller (neither being under a compulsion to buy or sell).

“Form 10‑K” is defined in Section 7.1(b).
“Form 10‑Q” is defined in Section 7.1(a).
“GAAP” means generally accepted accounting principles as in effect from time to
time in the United States of America.
“Governmental Authority” means
(a)    the government of
(i)    the United States of America or any state or other political subdivision
thereof, or
(ii)    any other jurisdiction in which the Company or any Subsidiary conducts
all or any part of its business, or which asserts jurisdiction over any
properties of the Company or any Subsidiary, or
(b)    any entity exercising executive, legislative, judicial, regulatory or
administrative functions of, or pertaining to, any such government.

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“Governmental Official” means any governmental official or employee, employee of
any government-owned or government-controlled entity, political party, any
official of a political party, candidate for political office, official of any
public international organization or anyone else acting in an official capacity.
“Guaranty” means, with respect to any Person, any obligation (except the
endorsement in the ordinary course of business of negotiable instruments for
deposit or collection) of such Person guaranteeing or in effect guaranteeing any
indebtedness, dividend or other obligation of any other Person in any manner,
whether directly or indirectly, including (without limitation) obligations
incurred through an agreement, contingent or otherwise, by such Person:
(a)    to purchase such indebtedness or obligation or any property constituting
security therefor;
(b)    to advance or supply funds (i) for the purchase or payment of such
indebtedness or obligation, or (ii) to maintain any working capital or other
balance sheet condition or any income statement condition of any other Person or
otherwise to advance or make available funds for the purchase or payment of such
indebtedness or obligation;
(c)    to lease properties or to purchase properties or services primarily for
the purpose of assuring the owner of such indebtedness or obligation of the
ability of any other Person to make payment of the indebtedness or obligation;
or
(d)    otherwise to assure the owner of such indebtedness or obligation against
loss in respect thereof.
In any computation of the indebtedness or other liabilities of the obligor under
any Guaranty, the indebtedness or other obligations that are the subject of such
Guaranty shall be assumed to be direct obligations of such obligor.
“Hazardous Materials” means any and all pollutants, toxic or hazardous wastes or
other substances that might pose a hazard to health and safety, the removal of
which may be required or the generation, manufacture, refining, production,
processing, treatment, storage, handling, transportation, transfer, use,
disposal, release, discharge, spillage, seepage or filtration of which is or
shall be restricted, prohibited or penalized by any applicable law including,
but not limited to, asbestos, urea formaldehyde foam insulation, polychlorinated
biphenyls, petroleum, petroleum products, lead based paint, radon gas or similar
restricted, prohibited or penalized substances.
“Hedge Treasury Note(s)” means, with respect to any Accepted Note, the United
States Treasury Note or Notes whose duration (as determined by Prudential) most
closely matches the duration of such Accepted Note.
“holder” means, with respect to any Note, the Person in whose name such Note is
registered in the register maintained by the Company pursuant to Section 13.1,
provided, however, that if such Person is a nominee, then for the purposes of
Sections 7, 12, 17.2 and 18 and any related definitions

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in this Schedule A, “holder” shall mean the beneficial owner of such Note whose
name and address appears in such register.
“Hostile Tender Offer” means, with respect to the use of proceeds of any Note,
any offer to purchase, or any purchase of, shares of capital stock of any
corporation or equity interests in any other entity, or securities convertible
into or representing the beneficial ownership of, or rights to acquire, any such
shares or equity interests, if such shares, equity interests, securities or
rights are of a class which is publicly traded on any securities exchange or in
any over-the-counter market, other than purchases of such shares, equity
interests, securities or rights representing less than 5% of the equity
interests or beneficial ownership of such corporation or other entity for
portfolio investment purposes, and such offer or purchase has not been duly
approved by the board of directors of such corporation or the equivalent
governing body of such other entity prior to the date on which the Company makes
the Request for Purchase of such Note.
“INHAM Exemption” is defined in Section 6.2(e).
“Indebtedness” with respect to any Person means, at any time, without
duplication,
(a)    its liabilities for borrowed money and its redemption obligations in
respect of mandatorily redeemable Preferred Stock;
(b)    its liabilities for the deferred purchase price of property acquired by
such Person (excluding accounts payable arising in the ordinary course of
business but including all liabilities created or arising under any conditional
sale or other title retention agreement with respect to any such property);
(c)    (i) all liabilities appearing on its balance sheet in accordance with
GAAP in respect of Capital Leases and (ii) all liabilities which would appear on
its balance sheet in accordance with GAAP in respect of Synthetic Leases
assuming such Synthetic Leases were accounted for as Capital Leases;
(d)    all liabilities for borrowed money secured by any Lien with respect to
any property owned by such Person (whether or not it has assumed or otherwise
become liable for such liabilities);
(e)    all its liabilities in respect of letters of credit or instruments
serving a similar function issued or accepted for its account by banks and other
financial institutions (whether or not representing obligations for borrowed
money);
(f)    the aggregate Swap Termination Value of all Swap Contracts of such
Person; and
(g)    any Guaranty of such Person with respect to liabilities of a type
described in any of clauses (a) through (f) hereof.

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Indebtedness of any Person shall include all obligations of such Person of the
character described in clauses (a) through (g) to the extent such Person remains
legally liable in respect thereof notwithstanding that any such obligation is
deemed to be extinguished under GAAP.
“Indebtedness Prepayment Application” means, with respect to any Transfer of
property constituting an Asset Disposition, the application by the Company or
any Subsidiary of cash in an amount equal to the Net Proceeds Amount (or portion
thereof) with respect to such Transfer to pay Senior Indebtedness; provided,
that in the event such Senior Indebtedness would otherwise permit the
reborrowing of such Senior Indebtedness by the Company or such Subsidiary, the
commitment to relend such Senior Indebtedness shall be permanently reduced by
the amount of such Indebtedness Prepayment Application
“Institutional Investor” means (a) any Purchaser of a Note, (b) any holder of a
Note holding (together with one or more of its affiliates) more than 5% of the
aggregate principal amount of the Notes then outstanding, (c) any bank, trust
company, savings and loan association or other financial institution, any
pension plan, any investment company, any insurance company, any broker or
dealer, or any other similar financial institution or entity, regardless of
legal form, and (d) any Related Fund of any holder of any Note.
“Issuance Fee” is defined in Section 2(h)(ii).
“Issuance Period” is defined in Section 2(b).
“Lien” means, with respect to any Person, any mortgage, lien, pledge, charge,
security interest or other encumbrance, or any interest or title of any vendor,
lessor, lender or other secured party to or of such Person under any conditional
sale or other title retention agreement or Capital Lease, upon or with respect
to any property or asset of such Person (including in the case of stock,
stockholder agreements, voting trust agreements and all similar arrangements).
“Long Term Debt” of any Person means all Indebtedness of such Person for
borrowed money or which has been incurred in connection with the acquisition of
assets in each case having a final maturity of more than one year from the date
of origin thereof (or which is renewable or extendible at the option of the
obligor for a period or periods more than one year from the date of origin), but
excluding all payments in respect thereof that are required to be made within
one year from the date of any determination of Long Term Debt, whether or not
the obligation to make such payments shall constitute a current liability of the
obligor under GAAP.
“Make-Whole Amount” is defined in Section 8.6.
“Material” means material in relation to the business, operations, affairs,
financial condition, assets, properties, or prospects of the Company and its
Subsidiaries taken as a whole.
“Material Adverse Effect” means a material adverse effect on (a) the business,
operations, affairs, financial condition, assets or properties of the Company
and its Subsidiaries taken as a whole, (b) the ability of the Company to perform
its obligations under this Agreement and the Notes, (c) the ability of any
Subsidiary Guarantor to perform its obligations under its Subsidiary Guaranty

A-8

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or the ability of the Parent Guarantor to perform its obligations under the
Parent Guaranty, or (d) the validity or enforceability of this Agreement, the
Notes, the Parent Guaranty or any Subsidiary Guaranty.
“Material Credit Facility” means, as to the Company and its Subsidiaries,
(a)    the Credit Agreement dated as of March 30, 2012 by and between the
Company and Wells Fargo Bank, National Association, including any renewals,
extensions, amendments, supplements, restatements, replacements or refinancings
thereof; and
(b)    any other agreement(s) creating or evidencing indebtedness for borrowed
money entered into on or after the date hereof by the Company or any Subsidiary,
or in respect of which the Company or any Subsidiary is an obligor or otherwise
provides a guarantee or other credit support (“Credit Facility”), in a principal
amount outstanding or available for borrowing equal to or greater than
$5,000,000 (or the equivalent of such amount in the relevant currency of
payment, determined as of the date of the closing of such facility based on the
exchange rate of such other currency); and if no Credit Facility or Credit
Facilities equal or exceed such amounts, then the largest Credit Facility shall
be deemed to be a Material Credit Facility.
“Maturity Date” is defined in the first paragraph of each Note.
“Multiemployer Plan” means any Plan that is a “multiemployer plan” (as such term
is defined in section 4001(a)(3) of ERISA).
“NAIC” means the National Association of Insurance Commissioners or any
successor thereto.
“Net Proceeds Amount” means, with respect to any Transfer of any property by any
Person, an amount equal to the difference of
(a)    the aggregate amount of the consideration (valued at the Fair Market
Value of such consideration at the time of the consummation of such Transfer)
allocated to such Person in respect of such Transfer, net of any applicable
taxes incurred in connection with such Transfer, minus
(b)    all ordinary and reasonable out-of-pocket costs and expenses actually
incurred by such Person in connection with such Transfer.

“Notes” is defined in Section 1.
“OFAC” is defined in Section 5.16(a).
“OFAC Listed Person” is defined in Section 5.16(a).

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Execution Version

“OFAC Sanctions Program” means any economic or trade sanction that OFAC is
responsible for administering and enforcing. A list of OFAC Sanctions Programs
may be found at
http://www.treasury.gov/resource-center/sanctions/Programs/Pages/Programs.aspx.
“Officer’s Certificate” means a certificate of a Senior Financial Officer or of
any other officer of the Company whose responsibilities extend to the subject
matter of such certificate.
“Parent Guaranty” means that certain Unconditional Parent Guaranty dated as of
the date hereof of the Parent Guarantor, for the benefit of the holders of the
Notes, from time to time, as amended, modified or supplemented.
“Parent Guarantor” means RGC Resources, Inc., a Virginia corporation.
“PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in
ERISA or any successor thereto.
“Person” means an individual, partnership, corporation, limited liability
company, association, trust, unincorporated organization, business entity or
Governmental Authority.
“Plan” means an “employee benefit plan” (as defined in section 3(3) of ERISA)
subject to Title I of ERISA that is or, within the preceding five years, has
been established or maintained, or to which contributions are or, within the
preceding five years, have been made or required to be made, by the Company or
any ERISA Affiliate or with respect to which the Company or any ERISA Affiliate
may have any liability.
“Preferred Stock” means any class of capital stock of a Person that is preferred
over any other class of capital stock (or similar equity interests) of such
Person as to the payment of dividends or the payment of any amount upon
liquidation or dissolution of such Person.
“Priority Indebtedness” means the sum, without duplication, of (i) all
Indebtedness of the Company or any Subsidiary secured by Liens other than Liens
permitted by clauses (a) through (i), inclusive, of Section 10.5, plus (ii) all
Indebtedness of Subsidiaries (excluding any such Indebtedness described in this
clause (ii) of any Subsidiary Guarantor or of any Subsidiary owing to the
Company or to another Subsidiary).
“property” or “properties” means, unless otherwise specifically limited, real or
personal property of any kind, tangible or intangible, choate or inchoate.
“Property Reinvestment Application” means, with respect to any Transfer of
property constituting an Asset Disposition, the application of an amount equal
to the Net Proceeds Amount with respect to such Transfer to the acquisition by
the Company or any Subsidiary of operating assets for the Company or any
Subsidiary to be used in the principal business of such Person (or of an entity
owning operating assets, in which event the Property Reinvestment Application
shall be limited to the Fair Market Value of such operating assets).

A-10

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Execution Version

“Prudential” is defined in the addressee line to this Agreement.
“Prudential Affiliate” means any Affiliate of Prudential.
“PTE” is defined in Section 6.2(a).
“Purchaser” or “Purchasers” is defined in the addressee line to this Agreement
and includes such Purchaser’s successors and assigns.
“Qualified Institutional Buyer” means any Person who is a “qualified
institutional buyer” within the meaning of such term as set forth in Rule
144A(a)(1) under the Securities Act.
“QPAM Exemption” is defined in Section 6.2(d).
“Ratable Portion” means, in respect of any Note, an amount equal to the product
of (x) the Disposition Proceeds being applied to the permanent reduction of
Senior Indebtedness multiplied by (y) a fraction, the numerator of which is the
aggregate principal amount of such Note then outstanding and the denominator of
which is the aggregate principal amount of Senior Indebtedness then outstanding
(including the Notes) that will be reduced or repaid with the Disposition
Proceeds (calculated prior to such reduction or repayment).
“Related Fund” means, with respect to any holder of any Note, any fund or entity
that (i) invests in Securities or bank loans, and (ii) is advised or managed by
such holder, the same investment advisor as such holder or by an affiliate of
such holder or such investment advisor.
“Request for Purchase” is defined in Section 2(d).
“Required Holders” means at any time (i) prior to the initial Closing,
Prudential and (ii) on or after the initial Closing, the holders of more than
50% in principal amount of the Notes at the time outstanding (exclusive of Notes
then owned by the Company or any of its Affiliates).
“Rescheduled Closing Day” is defined in Section 3.2.
“Responsible Officer” means any Senior Financial Officer and any other officer
of the Company with responsibility for the administration of the relevant
portion of this Agreement.
“SEC” means the Securities and Exchange Commission of the United States, or any
successor thereto.
“Securities” or “Security” shall have the meaning specified in section 2(1) of
the Securities Act.
“Securities Act” means the Securities Act of 1933, as amended from time to time,
and the rules and regulations promulgated thereunder from time to time in
effect.
“Senior Indebtedness” shall mean and include (i) any Indebtedness of the Company
(other than Indebtedness owing to any Affiliate) which is not expressed to be
junior or subordinate to any

A-11

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Execution Version

other Indebtedness of the Company, and (ii) any Indebtedness of a Subsidiary
Guarantor (other than Indebtedness owing to any Affiliate) which is not
expressed to be junior or subordinate to any other Indebtedness of such
Subsidiary Guarantor.

“Senior Financial Officer” means the chief financial officer, principal
accounting officer, treasurer or assistant treasurer of the Company.
“Series” is defined in Section 1.
“Shelf Notes” is defined in Section 1.
“Source” is defined in Section 6.2.
“Structuring Fee” is defined in Section 2(h)(i).
“Subsidiary” means, as to any Person, any other Person in which such first
Person or one or more of its Subsidiaries or such first Person and one or more
of its Subsidiaries owns sufficient equity or voting interests to enable it or
them (as a group) ordinarily, in the absence of contingencies, to elect a
majority of the directors (or Persons performing similar functions) of such
second Person, and any partnership or joint venture if more than a 50% interest
in the profits or capital thereof is owned by such first Person or one or more
of its Subsidiaries or such first Person and one or more of its Subsidiaries
(unless such partnership or joint venture can and does ordinarily take major
business actions without the prior approval of such Person or one or more of its
Subsidiaries). Unless the context otherwise clearly requires, any reference to a
“Subsidiary” is a reference to a Subsidiary of the Company.
“Subsidiary Guarantor” means each Subsidiary that has executed and delivered a
Subsidiary Guaranty.
“Subsidiary Guaranty” is defined in Section 9.7(a).
“Substitute Purchaser” is defined in Section 21.
“Subsidiary Stock” means, with respect to any Person, the capital stock or
limited liability company or other equity (or any options or warrants to
purchase stock or similar equity interests or other Securities exchangeable for
or convertible into stock or similar equity interests) of any Subsidiary of such
Person.
“Super-Majority Holders” means at any time (i) prior to the initial Closing,
Prudential and (ii) on or after the initial Closing, the holders of at least
66-2/3% in principal amount of the Notes at the time outstanding (exclusive of
Notes then owned by the Company or any of its Affiliates).
“SVO” means the Securities Valuation Office of the NAIC or any successor to such
Office.
“Swap Contract” means (a) any and all interest rate swap transactions, basis
swap transactions, basis swaps, credit derivative transactions, forward rate
transactions, commodity

A-12

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Execution Version

swaps, commodity options, forward commodity contracts, equity or equity index
swaps or options, bond or bond price or bond index swaps or options or forward
foreign exchange transactions, cap transactions, floor transactions, currency
options, spot contracts or any other similar transactions or any of the
foregoing (including, without limitation, any options to enter into any of the
foregoing), and (b) any and all transactions of any kind, and the related
confirmations, which are subject to the terms and conditions of, or governed by,
any form of master agreement published by the International Swaps and
Derivatives Association, Inc. or any International Foreign Exchange Master
Agreement.

“Swap Termination Value” means, in respect of any one or more Swap Contracts,
after taking into account the effect of any legally enforceable netting
agreement relating to such Swap Contracts, (a) for any date on or after the date
such Swap Contracts have been closed out and termination value(s) determined in
accordance therewith, such termination value(s), and (b) for any date prior to
the date referenced in clause (a), the amounts(s) determined as the
mark-to-market values(s) for such Swap Contracts, as determined based upon one
or more mid-market or other readily available quotations provided by any
recognized dealer in such Swap Contracts.
“Synthetic Lease” means, at any time, any lease (including leases that may be
terminated by the lessee at any time) of any property (a) that is accounted for
as an operating lease under GAAP and (b) in respect of which the lessee retains
or obtains ownership of the property so leased for U.S. federal income tax
purposes, other than any such lease under which such Person is the lessor.
“Transfer” means, with respect to any Person, any transaction (including by
merger, consolidation or disposition of all or substantially all the assets of
such Person) in which such Person sells, conveys, transfers or leases (as
lessor) any of its property, including, without limitation, Subsidiary Stock.
“Transfer” shall also include the creation of minority interests in connection
with any merger or consolidation involving a Subsidiary if the resulting entity
is owned, directly or indirectly, by the Company in a proportion less than the
proportion of ownership of such Subsidiary by the Company immediately preceding
such merger or consolidation.

“USA PATRIOT Act” means United States Public Law 107-56, Uniting and
Strengthening America by Providing Appropriate Tools Required to Intercept and
Obstruct Terrorism (USA PATRIOT ACT) Act of 2001, as amended from time to time,
and the rules and regulations promulgated thereunder from time to time in
effect.
“U.S. Economic Sanctions” is defined in Section 5.16(a).
“Wholly-Owned Subsidiary” means, at any time, any Subsidiary all of the equity
interests (except directors’ qualifying shares) and voting interests of which
are owned by any one or more of the Company and the Company’s other Wholly-Owned
Subsidiaries at such time.

A-13

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SCHEDULE B

AUTHORIZED OFFICERS

Authorized Officers for the Company

John S. D’Orazio                        
President and CEO                        
Roanoke Gas Company                    
519 Kimball Avenue, NE                        
P.O. Box 13007                            
Roanoke, VA 24030-3007                        
Telephone: (540) 777-3815                    
Facsimile: (540) 777-2636                    

Paul W. Nester                        
Vice President, Secretary, Treasurer and CFO                        
Roanoke Gas Company                    
519 Kimball Avenue, NE                        
P.O. Box 13007                            
Roanoke, VA 24030-3007                        
Telephone: (540) 777-3837                    
Facsimile: (540) 777-2636

Howard T. Lyon                        
Assistant Secretary and Assistant Treasurer                        
Roanoke Gas Company                    
519 Kimball Avenue, NE                        
P.O. Box 13007                            
Roanoke, VA 24030-3007                        
Telephone: (540) 777-3842                    
Facsimile: (540) 777-2636

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SCHEDULE B

Authorized Officers for Prudential
 
 
 
Ric E. Abel
 
Matthew A. Baker
Managing Director
 
Vice President
Prudential Capital Group
 
Prudential Capital Group
2200 Ross Avenue
 
2200 Ross Avenue
Suite 4300
 
Suite 4300
Dallas, TX 75201
 
Dallas, TX 75201
Telephone: (214) 720-6272
 
Telephone: (214) 720-6253
Facsimile: (214) 720-6297
 
Facsimile: (214) 720-6222
 
 
 
Ty Bowman
 
Julia B. Buthman
Vice President
 
Managing Director
Prudential Capital Group
 
Prudential Capital Group
2200 Ross Avenue
 
2200 Ross Avenue
Suite 4300
 
Suite 4300
Dallas, TX 75201
 
Dallas, TX 75201
Telephone: (214) 720-6263
 
Telephone: (214) 720-6273
Facsimile: (214) 720-6297
 
Facsimile: (214) 720-6299
 
 
 
Wendy A. Carlson
 
Richard P. Carrell
Managing Director
 
Vice President
Prudential Capital Group
 
Prudential Capital Group
2200 Ross Avenue
 
2200 Ross Avenue
Suite 4300
 
Suite 4300
Dallas, TX 75201
 
Dallas, TX 75201
Telephone: (214) 720-6220
 
Telephone: (214) 720-6287
Facsimile: (214) 720-6297
 
Facsimile: (214) 720-6297
 
 
 
Brien F. Davis
 
Christopher L. Halloran
Vice President
 
Vice President
Prudential Capital Group
 
Prudential Capital Group
2200 Ross Avenue
 
2200 Ross Avenue
Suite 4300
 
Suite 4300
Dallas, TX 75201
 
Dallas, TX 75201
Telephone: (214) 720-6256
 
Telephone: (214) 720-6235
Facsimile: (214) 720-6299
 
Facsimile: (214) 720-6222
 
 
 
Randall M. Kob
 
Timothy M. Laczkowski
Senior Managing Director
 
Vice President
Prudential Capital Group
 
Prudential Capital Group

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Execution Version

2200 Ross Avenue
 
2200 Ross Avenue
Suite 4300
 
Suite 4300
Dallas, TX 75201
 
Dallas, TX 75201
Telephone: (214) 720-6210
 
Telephone: (214) 720-6275
Facsimile: (214) 720-6222
 
Facsimile: (214) 720-6299
 
 
 
Brian E. Lemons
 
Ingrida Soldatova
Vice President
 
Vice President
Prudential Capital Group
 
Prudential Capital Group
2200 Ross Avenue
 
2200 Ross Avenue
Suite 4300
 
Suite 4300
Dallas, TX 75201
 
Dallas, TX 75201
Telephone: (214) 720-6276
 
Telephone: (214) 720-6230
Facsimile: (214) 720-6222
 
Facsimile: (214) 720-6297
 
 
 
Brian N. Thomas
 
 
Managing Director
 
 
Prudential Capital Group
 
 
2200 Ross Avenue
 
 
Suite 4300
 
 
Dallas, TX 75201
 
 
Telephone: (214) 720-6216
 
 
Facsimile: (214) 720-6222
 
 

A-2

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SCHEDULE 1

[FORM OF NOTE]
ROANOKE GAS COMPANY

No. [_________]
PPN: [_________]
ORIGINAL PRINCIPAL AMOUNT: [_________]
ORIGINAL ISSUE DATE: [_________]
INTEREST RATE: [_________]
INTEREST PAYMENT DATES: [_________]
FINAL MATURITY DATE: [_________]
PRINCIPAL PREPAYMENT DATES AND AMOUNTS: [_________]
 

ROANOKE GAS COMPANY
NOTE
FOR VALUE RECEIVED, the undersigned, ROANOKE GAS COMPANY (the “Company”), a
corporation organized and existing under the laws of the Commonwealth of
Virginia, hereby promises to pay to __________ or its registered assigns, the
principal sum of $__________ and interest thereon as follows: The Company shall
pay the principal sum [on the Final Maturity Date specified above (or so much
thereof as shall not have been prepaid),] [, payable on the Principal Prepayment
Dates and in the amounts specified above, and on the Final Maturity Date
specified above in an amount equal to the unpaid balance of the principal
hereof,] (the “Maturity Date”) with interest (computed on the basis of a 360-day
year of twelve 30-day months) (a) on the unpaid balance hereof at the Interest
Rate per annum specified above, payable on each Interest Payment Date specified
above and on the Final Maturity Date specified above, commencing with the
Interest Payment Date next succeeding the date hereof, until the principal
hereof shall have become due and payable and (b)(x) to the extent legally
enforceable, on any overdue installment of interest and (y) during the
continuance of an Event of Default, on such unpaid balance and on any overdue
payment of any Make-Whole Amount, at a rate per annum from time to time equal to
the greater of (i) [___]% or (ii) 2.0% over the rate of interest publicly
announced by [_________________] from time to time in New York, New York as its
“base” or “prime” rate, payable on each Interest Payment Date specified above
(or, at the option of the registered holder hereof, on demand).
Payments of principal of, interest on, and any Make-Whole Amount with respect to
this Note are to be made in lawful money of the United States of America in the
manner provided in the Private Shelf Agreement.
This Note is one of a series of Notes issued pursuant to the Private Shelf
Agreement, dated as of September 30, 2015 between the Company, Prudential
Investment Management, Inc. and the Purchasers (as defined therein) (the
“Private Shelf Agreement”). Each Holder of this Note will be deemed, by its
acceptance hereof, to have (i) agreed to the confidentiality provisions set
forth in Section 20 of the Private Shelf Agreement and (ii) made the
representations set forth in Section 6

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Execution Version

of the Private Shelf Agreement. Unless otherwise indicated, capitalized terms
used in this Note shall have the respective meanings ascribed to such terms in
the Private Shelf Agreement.
This Note is a registered Note and, as provided in the Private Shelf Agreement,
upon surrender of this Note for registration of transfer, accompanied by a
written instrument of transfer duly executed, by the registered holder hereof or
such holder’s attorney duly authorized in writing, a new Note of the same Series
for a like principal amount will be issued to, and registered in the name of,
the transferee. Prior to due presentment for registration of transfer, the
Company shall treat the person in whose name this Note is registered as the
owner hereof for the purpose of receiving payment and for all other purposes,
and the Company will not be affected by any notice to the contrary.
The Company will make the required prepayments of principal on this Note on the
dates and in the amounts specified above. This Note is also subject to optional
prepayment, in whole or from time to time in part, at the times and on the terms
specified in the Private Shelf Agreement, but not otherwise.
If an Event of Default occurs and is continuing, the principal of this Note
shall become due and payable in the manner, at the price (including any
applicable Make-Whole Amount) and with the effect provided in the Private Shelf
Agreement.
In no event shall the interest contracted for, charged or received hereunder,
plus any other amounts contracted for, charged or received in connection
herewith which are deemed interest under the laws of the Commonwealth of
Virginia and the United States of America ever exceed the maximum amount of
nonusurious interest which could be lawfully contracted for, charged or received
under applicable law.
This Note shall be construed and enforced in accordance with, and the rights of
the Company and the holder of this Note shall be governed by, the law of the
Commonwealth of Virginia excluding choice-of-law principles of the law of such
Commonwealth that would permit the application of the laws of a jurisdiction
other than such Commonwealth.

2

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Execution Version

IN WITNESS WHEREOF, the Company has caused this Note to be duly executed,
attested and delivered the ____ day of _________, 20[__].

 
ROANOKE GAS COMPANY
                                                              
Name
Title
 
 
 
 

3

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SCHEDULE 2(d)

[FORM OF REQUEST FOR PURCHASE]

ROANOKE GAS COMPANY
Reference is made to the Private Shelf Agreement (as amended from time to time,
the “Agreement”), dated as of September 30, 2015, between Roanoke Gas Company
(the “Company”), on the one hand, and Prudential Investment Management, Inc.
(“Prudential”) and each Prudential Affiliate which becomes party thereto, on the
other hand. Capitalized terms used and not otherwise defined herein shall have
the respective meanings specified in the Agreement.
Pursuant to Section 2(d) of the Agreement, the Company hereby makes the
following Request for Purchase:

1.
Aggregate principal amount of

the Notes covered hereby
(the “Notes”) ................... $__________1

2.
Individual specifications of the Notes:

Principal
Amount
Final
Maturity
Date
Principal
Prepayment
Dates and
Amounts
Interest
Payment
Period

 
 

[Quarterly][Semi-annually] in arrears

3.
Use of proceeds of the Notes:

4.
Proposed day for the closing of the purchase and sale of the Notes:

5.
The purchase price of the Notes is to be transferred to:

Name and Address
and ABA Routing
Number of

Number of Bank
Account

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Execution Version

6.    The Company certifies that [the attached [Schedule[s]
[5.3/5.4/5.5/5.15][modified representations and/or warranties] are true and
correct on and as of the date of this Request for Purchase and] (a) the
representations and warranties contained in Section 5 of the Agreement[, as
amended by the attached [Schedules][modifications],] are true on and as of the
date of this Request for Purchase and (b) that there exists on the date of this
Request for Purchase no Event of Default or Default.
7.    The Issuance Fee to be paid pursuant to the Agreement will be paid by the
Company on the Closing Day.

Dated:

Roanoke Gas Company

By ______________________________
Authorized Officer

2

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SCHEDULE 2(f)

[FORM OF CONFIRMATION OF ACCEPTANCE]
Reference is made to the Private Shelf Agreement (as amended from time to time,
the “Agreement”), dated as of September 30, 2015 between Roanoke Gas Company
(the “Company”), on the one hand, and Prudential Investment Management, Inc.
(“Prudential”) and each Prudential Affiliate which becomes party thereto, on the
other hand. All terms used herein that are defined in the Agreement have the
respective meanings specified in the Agreement.
Prudential or the Prudential Affiliate which is named below as a Purchaser of
Notes hereby confirms the representations as to such Notes set forth in Section
6 of the Agreement, and agrees to be bound by the provisions of the Agreement
applicable to the Purchasers or holders of the Notes.
Pursuant to Section 2(f) of the Agreement, an Acceptance with respect to the
following Accepted Notes is hereby confirmed:
I.
Accepted Notes: Aggregate principal

amount $__________________

(A)
(a)    Name of Purchaser:

(b)    Principal amount:
(c)    Final maturity date:
(d)    Principal prepayment dates and amounts:
(e)    Interest rate:
(f)    Interest payment period:    [Quarterly][Semi-annually] in arrears
(g)    Payment and notice instructions:    As set forth on attached
Purchaser Schedule

(B)
(a)    Name of Purchaser:

(b)    Principal amount:
(c)    Final maturity date:
(d)    Principal prepayment dates and amounts:
(e)    Interest rate:
(f)    Interest payment period:    [Quarterly][Semi-annually] in arrears
(g)    Payment and notice instructions:    As set forth on attached
Purchaser Schedule

[(C), (D)…. same information as above.]

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Execution Version

II.
Closing Day:

III.
Issuance Fee:

[IV
[Prudential hereby waives the time period for delivery requirements in Section
2.2(d) related to the information described in paragraph 6 of the Request for
Purchase.][Prudential acknowledges receipt of the [updated schedule[s]][modified
representations and/or warranties] described in paragraph 6 of the Request for
Purchase dated [________]].

2

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Execution Version

ROANOKE GAS COMPANY

By: ________________________________
Name: _____________________________
Title: ______________________________
Dated: _____________________________

PRUDENTIAL INVESTMENT
MANAGEMENT, INC.

By ______________________________
Vice President

[PRUDENTIAL AFFILIATE]

By ______________________________
Vice President

[ATTACH PURCHASER SCHEDULE]

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SCHEDULE 5.3

DISCLOSURE MATERIALS

With the exception of this Agreement and the financial statements, 10-K filings
and 10-Q filings listed in Schedule 5.5 of this Agreement, there are no
Disclosure Documents.

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SCHEDULE 5.4

SUBSIDIARIES OF THE COMPANY AND OWNERSHIP OF SUBSIDIARY STOCK

The Company has no Subsidiaries.
The Company's Affiliates are the following:
RGC Resources, Inc.
RGC Ventures of Virginia, Inc.
Diversified Energy Company
RGC Midstream, LLC

The Company's directors are the following:
John B. Williamson, III
John S. D'Orazio
Maryellen F. Goodlatte
S. Frank Smith
J. Allen Layman
Nancy Howell Agee
George W. Logan
The Company's senior officers are the following:
John S. D'Orazio            President and CEO
Howard T. Lyon            Assistant Secretary and Assistant Treasurer
Paul W. Nester            Vice President, Secretary, Treasurer and CFO
Carl J. Shockley, Jr.            Vice President, Operations

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SCHEDULE 5.5

FINANCIAL STATEMENTS

The Company has delivered the following financial statements:

 
Fiscal Year Ended
 
Quarter Ended
 
September 30, 2014
 
June 30, 2015
 
Financial Statements
 
Financial Statements
 
Audited
Unaudited
10-K
 
Audited
Unaudited
10-Q
 
 
 
 
 
 
 
 
RGC Resources, Inc.
X
 
X
 
 
X
X
 
 
 
 
 
 
 
 
Roanoke Gas Company, Inc.
 
X
 
 
 
X
 
 
 
 
 
 
 
 
 
Diversified Energy Company, Inc.
 
X
 
 
 
X
 
 
 
 
 
 
 
 
 
RGC Ventures of Virginia, Inc.
 
X
 
 
 
X
 
 
 
 
 
 
 
 
 
RGC Midstream, LLC
 
N/A
 
 
 
N/A
 

The aforesaid audited financial statements for RGC Resources, Inc. are
consolidated financial statements for RGC Resources, Inc. and its Subsidiaries.

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SCHEDULE 5.15

EXISTING INDEBTEDNESS

The Company was the obligor with respect to the following Indebtedness as of
June 30, 2015:

Principal Amount
Obligee                 Outstanding      Collateral      Guarantor    

The Prudential Insurance
Company of America    $ 15,250,000    None    RGC Resources, Inc.

Par U Hartford Life & Annuity
Comfort Trust         9,700,000    None    RGC Resources, Inc.

Pruco Life Insurance Company
of New Jersey         5,550,000    None    RGC Resources, Inc.

Wells Fargo Bank, N.A. – Revolving          1,718,504    None    RGC Resources,
Inc.
Line of Credit    ______________
$    32,218,504

The maximum principal amount that can be outstanding at any time under the
aforesaid revolving line of credit is $24,000,000.

The documents relating to certain of the aforesaid Indebtedness restrict the
Company's ability to incur Indebtedness unless prescribed ratios are not
exceeded. Such ratios would not be exceeded by reason of the issuance of the
Notes, and such documents would not prohibit the issuance of the Notes.

--------------------------------------------------------------------------------

EXHIBIT 4.4(a)

FORM OF OPINION OF SPECIAL COUNSEL
TO THE COMPANY
Matters To Be Covered in
Opinion of Special Counsel to the Company and Parent Guarantor
1.    Each of the Parent Guarantor, Company and its Subsidiaries being duly
incorporated, validly existing and in good standing and having requisite
corporate power and authority to issue and sell the Notes and to execute and
deliver the documents (including the Private Shelf Agreement).
2.    Each of the Parent Guarantor, Company and its Subsidiaries being duly
qualified and in good standing as a foreign corporation in appropriate
jurisdictions.
3.    Due authorization and execution of the documents (including the Private
Shelf Agreement) and such documents being legal, valid, binding and enforceable.
4.    No conflicts with charter documents, laws or other agreements.
5.    All consents required to issue and sell the Notes and to execute and
deliver the documents (including the Private Shelf Agreement) having been
obtained.
6.    No litigation questioning validity of documents (including the Private
Shelf Agreement).
7.    The Notes and the Parent Guaranty not requiring registration under the
Securities Act of 1933, as amended; no need to qualify an indenture under the
Trust Indenture Act of 1939, as amended.
8.    No violation of Regulations T, U or X of the Federal Reserve Board.
9.    Parent Guarantor and Company not an “investment company”, or a company
“controlled” by an “investment company”, under the Investment Company Act of
1940, as amended.

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EXHIBIT 4.4(b)

FORM OF OPINION OF SPECIAL COUNSEL
TO THE PURCHASERS

[Provided to the Purchasers.]

--------------------------------------------------------------------------------

Roanoke Gas Company
__________________________________
First Amendment
dated as of September 30, 2017

to

Private Shelf Agreement
dated as of September 30, 2015
__________________________________

--------------------------------------------------------------------------------

Table of Contents
 
 
 
 
 
(Not a part of this First Amendment)
 
 
 
 
 
Section
 
 
Heading
Page
 
 
 
 
 
Section 1.
 
 
Amendments To Shelf Agreement.
1

 
 
 
 
 
Section 2.
 
 
Representations and Warranties
2

 
 
 
 
 
Section 3.
 
 
Conditions Precedent
3

 
 
 
 
 
Section 4.
 
 
Miscellaneous
4

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Dated as of
September 30, 2017
To PGIM, Inc. (fka Prudential Investment Management, Inc.)

Ladies and Gentlemen:
Reference is made to (i) the Private Shelf Agreement dated as of September 30,
2015 (as amended from time to time, the “Shelf Agreement”), between Roanoke Gas
Company (the “Company”), on the one hand, and PGIM, Inc. (fka Prudential
Investment Management, Inc.) (“Prudential”) and each Prudential Affiliate which
becomes party thereto, on the other hand. Capitalized terms used in this First
Amendment (this “First Amendment”) without definition shall have the meanings
given such terms in the Shelf Agreement.
For good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the Company requests the amendment of certain provisions of
the Shelf Agreement as hereinafter provided.
Upon your acceptance hereof in the manner hereinafter provided and upon
satisfaction of all conditions to the effectiveness hereof, this First Amendment
shall be effective, but only in the respects hereinafter set forth:
Section 1.
Amendments To Shelf Agreement.

(a)    Section 2 (b). (Issuance Period) of the Shelf Agreement is hereby amended
by deleting Section 2 (b) in its entirety and replacing it with the following:

(b)    Issuance Period. Notes may be issued and sold pursuant to this Agreement
until the earlier of (i) the third anniversary of October 2, 2017 (or if such
anniversary date is not a Business Day, the Business Day next preceding such
anniversary) and (ii) the thirtieth day after Prudential shall have given to the
Company, or the Company shall have given to Prudential, a written notice stating
that it elects to terminate the issuance and sale of Shelf Notes pursuant to
this Agreement (or if such thirtieth day is not a Business Day, the Business Day
next preceding such thirtieth day). The period during which Shelf Notes may be
issued and sold pursuant to this Agreement is herein called the “Issuance
Period.”
(b)    Section 4.11. (Parent Guaranty) of the Shelf Agreement is hereby amended
by deleting Section 4.11 in its entirety and replacing it with the following:
Section 4.11. Parent Guaranty. The Parent Guaranty shall have been duly executed
and delivered by the Parent Guarantor (and each Purchaser shall have received an
original copy

--------------------------------------------------------------------------------

thereof), shall be in full force and effect on the date thereof and shall be
satisfactory in form and substance to such Purchaser.
(c)    The definition of Parent Guaranty as set forth in Schedule A - Defined
Terms of the Shelf Agreement is hereby amended by deleting it in its entirety
and replacing it with the following:
“Parent Guaranty” means that certain Unconditional Parent Guaranty dated as of
the date thereof of the Parent Guarantor, for the benefit of the holders of the
Notes, from time to time, as amended, modified or supplemented.
Section 2.
Representations and Warranties.

The Company hereby represents and warrants that:
(a)    The Company is a corporation duly organized, validly existing and in good
standing under the laws of its jurisdiction of incorporation, and is duly
qualified as a foreign corporation and is in good standing in each jurisdiction
in which such qualification is required by law, other than those jurisdictions
as to which the failure to be so qualified or in good standing could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.
(b)    This First Amendment and the Shelf Agreement, as amended hereby, (all of
the foregoing documents are referred to herein as the “Note Documents”) and the
transactions contemplated hereby are within the corporate power of the Company,
have been duly authorized by all necessary company action on the part of the
Company, and the Note Documents have been duly executed and delivered by the
Company and constitute legal, valid and binding obligations of the Company
enforceable in accordance with their terms, except as such enforceability may be
limited by (i) applicable bankruptcy, insolvency, reorganization, moratorium or
other similar laws affecting the enforcement of creditors’ rights generally and
(ii) general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law).
(c)    Immediately prior to and after giving effect to this First Amendment, no
Default has occurred and is continuing and no Event of Default has occurred
under the Shelf Agreement, as amended hereby.
(d)    The execution, delivery and performance of the Note Documents by the
Company does not and will not (i) contravene, result in any breach of, or
constitute a default under, or result in the creation of any Lien in respect of
any property of the Company or any Subsidiary under, any indenture, mortgage,
deed of trust, loan, purchase or credit agreement, lease, corporate charter or
by-laws, shareholders agreement or any other agreement or instrument to which
the Company or any Subsidiary is bound or by which the Company or any Subsidiary
or any of their respective properties may be bound or affected, (ii) conflict
with or result in a breach of any of the terms, conditions or provisions of any
order, judgment, decree or ruling of any court, arbitrator or Governmental
Authority applicable to the

--------------------------------------------------------------------------------

Company or any Subsidiary or (iii) violate any provision of any statute or other
rule or regulation of any Governmental Authority applicable to the Company or
any Subsidiary.
(e)    No consent, approval or authorization of, or registration, filing or
declaration with, any Governmental Authority is required in connection with the
execution, delivery or performance by the Company of the Note Documents.
Section 3.
Conditions Precedent.

This First Amendment shall not become effective until, and shall become
effective on, the Business Day when each of the following conditions shall have
been satisfied:
(a)    Prudential shall have received this First Amendment, duly executed by the
Company.
(b)    Prudential shall have consented to this First Amendment as evidenced by
its execution thereof.
(c)    The representations and warranties of the Company set forth in Section 2
hereof shall be true and correct.
(d)    Any consents or approvals from any holder or holders of any outstanding
security or indebtedness of the Company and any amendments of agreements
pursuant to which any securities or indebtedness may have been issued which
shall be necessary to permit the consummation of the transactions contemplated
hereby shall have been obtained and all such consents or amendments shall be
reasonably satisfactory in form and substance to Prudential and its special
counsel.
(e)    All corporate proceedings and other proceedings in connection with the
transactions contemplated by this First Amendment and all documents and
instruments incident to such transactions shall be reasonably satisfactory to
Prudential and its special counsel, and Prudential and its special counsel shall
have received all such counterpart originals or certified or other copies of
such documents as Prudential or its special counsel may reasonably request.
(f)    Prudential shall have received such certificates of officers of the
Company as it may reasonably request with respect to this First Amendment and
the transactions contemplated hereby.
(g)    The Company shall have paid the fees and disbursements of Prudential’s
special counsel, Greenberg Traurig, LLP, incurred in connection with the
negotiation, preparation, execution and delivery of this First Amendment and the
transactions contemplated hereby which fees and disbursements are reflected in
the statement of such special counsel delivered to the Company at the time of
the execution and delivery of this First Amendment.

--------------------------------------------------------------------------------

Prudential hereby agrees with the Company that the execution and delivery of its
signature page to this First Amendment shall evidence the satisfaction of each
of the conditions precedent set forth in this Section 3.
Section 4.
Miscellaneous.

Section 4.1.    Except as amended herein, all terms and provisions of the Shelf
Agreement and related agreements and instruments are hereby ratified, confirmed
and approved in all respects.
Section 4.2.        Each reference in the Shelf Agreement to “this Agreement,”
“hereunder,” “hereof,” or words of similar import in instruments or documents
provided for in the Shelf Agreement or delivered or to be delivered thereunder
or in connection therewith, shall, except where the context otherwise requires,
be deemed a reference to the Shelf Agreement, as amended hereby.
Section 4.3.    This First Amendment shall be governed by and construed in
accordance with, and the rights of the parties shall be governed by, the law of
the Commonwealth of Virginia excluding choice‑of‑law principles of the law of
such Commonwealth that would permit the application of the laws of a
jurisdiction other than such Commonwealth.
Section 4.4.    This First Amendment and all covenants herein contained shall be
binding upon and inure to the benefit of the respective successors and assigns
of the parties hereunder. All representations, warranties and covenants made by
the Company herein shall survive the closing and the delivery of this First
Amendment.
Section 4.5.    This First Amendment may be executed in any number of
counterparts, each of which shall be deemed to be an original and all of which,
taken together, shall constitute but one and the same First Amendment. Delivery
of an executed counterpart of this First Amendment by facsimile or transmitted
electronically in either Tagged Image File Format (“TIFF”) or Portable Document
Format (“PDF”) shall be as effective as delivery of a manually executed
counterpart of this First Amendment.

[Signature Pages Follow]

--------------------------------------------------------------------------------

The execution hereof by the Company and Prudential shall constitute a binding
agreement between the Company and Prudential and each Prudential Affiliate which
becomes bound to the Shelf Agreement as provided in the Shelf Agreement for the
uses and purposes hereinabove set forth.

The undersigned, hereby acknowledges, approves and agrees to the foregoing First
Amendment.

 
Roanoke Gas Company

By: /s/ John S. D'Orazio          
Name: John S. D’Orazio
Title: President

By: /s/ Paul W. Nester             
Name: Paul W. Nester
Title: Chief Financial Officer

    

--------------------------------------------------------------------------------

The undersigned, hereby acknowledges, approves and agrees to the foregoing First
Amendment.

    
PGIM, Inc.

    
By: /s/ Brian Lemons
Vice President