Northern States Power Company



 




Exhibit 4.1




REGISTRATION RIGHTS AGREEMENT



     THIS REGISTRATION RIGHTS AGREEMENT (this “Agreement”) is made and entered
into as of August 29, 2002 by and among Northern States Power Company, a
Minnesota corporation (the “Company”), and the Initial Purchasers (as
hereinafter defined).





     This Agreement is made pursuant to the Purchase Agreement dated August 22,
2002 (the “Purchase Agreement”), by and among the Company, as issuer of the
$450,000,000 aggregate principal amount of 8.00% First Mortgage Bonds, Series A
due 2012 (the “Bonds”), and the Initial Purchasers, which provides for, among
other things, the sale by the Company to the Initial Purchasers of the
aggregate principal amount of Bonds specified therein. In order to induce the
Initial Purchasers to enter into the Purchase Agreement, the Company has agreed
to provide to the Initial Purchasers and their direct and indirect transferees
the registration rights set forth in this Agreement. The execution and delivery
of this Agreement is a condition to the closing under the Purchase Agreement.





     In consideration of the foregoing, the parties hereto agree as follows:





     1.     Definitions. As used in this Agreement, the following capitalized
defined terms shall have the following meanings:





     “Advice” shall have the meaning set forth in the last paragraph of Section
3 hereof.





     “Affiliate” has the meaning given to that term in Rule 405 under the
Securities Act or any successor rule thereunder.





     “Applicable Period” shall have the meaning set forth in Section 3(u)
hereof.





     “Bonds” shall have the meaning set forth in the preamble to this
Agreement.





     “Business Day” shall mean any day other than a Saturday, a Sunday, or a
day on which banking institutions in The City of New York are authorized or
required by law or executive order to remain closed.





     “Closing Date” shall mean August 29, 2002, the initial date of delivery of
the Bonds from the Company to the Initial Purchasers.





     “Company” shall have the meaning set forth in the preamble to this
Agreement and also includes the Company’s successors and permitted assigns.





     “Depositary” shall mean The Depository Trust Company, or any other
depositary appointed by the Company; provided, however, that such depositary
must have an address in the Borough of Manhattan, The City of New York.





     “Effectiveness Period” shall have the meaning set forth in Section 2(b)
hereof.







 







 


     “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended
from time to time.





     “Exchange Bonds” shall mean the 8.00% First Mortgage Bonds, Series B due
2012 issued by the Company under the Indenture containing terms identical in
all material respects to the Bonds (except that (i) interest thereon shall
accrue from the last date on which interest was paid or duly provided for on
the Bonds or, if no such interest has been paid, from the date of their
original issue, (ii) they will not contain terms with respect to transfer
restrictions under the Securities Act, and (iii) they will not provide for any
Special Interest Premium thereon.





     “Exchange Offer” shall mean the offer by the Company to the Holders to
exchange all of the Registrable Bonds held by each such Holder for a like
amount of Exchange Bonds pursuant to Section 2(a) hereof.





     “Exchange Offer Registration” shall mean a registration under the
Securities Act effected pursuant to Section 2(a) hereof.





     “Exchange Offer Registration Statement” shall mean an exchange offer
registration statement on Form S-4 (or, if applicable, on another appropriate
form), and all amendments and supplements to such registration statement, in
each case including the Prospectus contained therein, all exhibits thereto and
all documents incorporated by reference therein.





     “Exchange Period” shall have the meaning set forth in Section 2(a) hereof.





     “Holder” shall mean any Initial Purchaser, for so long as it owns any
Registrable Bonds, and each of its successors, assigns and direct and indirect
transferees who become registered owners of Registrable Bonds under the
Indenture.





     “Indenture” shall mean the Trust Indenture, dated as of February 1, 1937,
from the Company to Harris Trust and Savings Bank, as trustee, as amended by
supplemental trust indentures including the Supplemental and Restated Trust
Indenture, dated May 1, 1988, and the Supplemental Trust Indenture, dated as of
August 1, 2002, from the Company to BNY Midwest Trust Company, as successor
trustee, as the same may be amended or supplemented from time to time in
accordance with the terms thereof.





     “Initial Purchasers” shall mean Lehman Brothers Inc., ABN AMRO
Incorporated, Banc One Capital Markets, Inc., BNY Capital Markets, Inc.,
Tokyo-Mitsubishi International plc, U.S. Bancorp Piper Jaffray Inc. and Wells
Fargo Brokerage Services, LLC.





     “Inspectors” shall have the meaning set forth in Section 3(p) hereof.





     “Majority Holders” shall mean the Holders of a majority of the aggregate
principal amount of outstanding Bonds or Exchange Bonds, as the case may be.





     “Parent” shall mean Xcel Energy Inc., the sole direct holder of all of the
stock of the Company.





     “Participating Broker-Dealer” shall have the meaning set forth in Section
3(u) hereof.







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     “Person” shall mean an individual, partnership, corporation, trust or
unincorporated organization, limited liability company, or a government or
agency or political subdivision thereof or other legal entity.





     “Prospectus” shall mean the prospectus included in a Registration
Statement, including any preliminary prospectus, and any such prospectus as
amended or supplemented by any prospectus supplement, including a prospectus
supplement with respect to the terms of the offering of any portion of the
Registrable Bonds covered by a Shelf Registration Statement, and by all other
amendments and supplements to a prospectus, including post-effective
amendments, and in each case including all documents incorporated by reference
therein.





     “Purchase Agreement” shall have the meaning set forth in the preamble to
this Agreement.





     “Records” shall have the meaning set forth in Section 3(p) hereof.





     “Registrable Bonds” shall mean the Bonds, until the earliest to occur of
(a) the date on which any Bond has been exchanged by a Person other than a
Participating Broker-Dealer for Exchange Bonds in the Exchange Offer, (b)
following the exchange by a Broker-Dealer in the Exchange Offer of any Bond for
one or more Exchange Bonds, the date on which such Exchange Bonds are sold to a
purchaser in accordance with the Exchange Offer Registration Statement, (c) the
date on which any Bond has been registered under the Securities Act and
disposed of in accordance with the Shelf Registration Statement and (d) the
date on which any Bond is eligible to be distributed to the public pursuant to
Rule 144(k) under the Securities Act.





     “Registration Expenses” shall mean any and all expenses incident to
performance of or compliance by the Company with this Agreement, including
without limitation: (i) all SEC or National Association of Securities Dealers,
Inc. (the “NASD”) registration and filing fees, including, if applicable, the
fees and expenses of any “qualified independent underwriter” (and its counsel)
that is required to be retained by any Holder of Registrable Bonds in
accordance with the rules and regulations of the NASD, (ii) all fees and
expenses incurred in connection with compliance with state securities or blue
sky laws (including reasonable fees and disbursements of one counsel for all
underwriters and Holders as a group in connection with blue sky qualification
of any of the Exchange Bonds or Registrable Bonds) and compliance with the
rules of the NASD, (iii) all expenses of any Persons in preparing or assisting
in preparing, word processing, printing and distributing any Registration
Statement, any Prospectus and any amendments or supplements thereto, and in
preparing or assisting in preparing, printing and distributing any underwriting
agreements, Bonds sales agreements and other documents relating to the
performance of and compliance with this Agreement, (iv) all rating agency fees,
(v) the fees and disbursements of counsel for the Company and of the
independent certified public
accountants of the Company and its subsidiaries, including the expenses of
any “cold comfort” letters required by or incident to the performance of and
compliance with this Agreement, (vi) the reasonable fees and expenses of the
Trustee and its counsel and any exchange agent or custodian, and (vii) the
reasonable fees and expenses of any special experts retained by the Company in
connection with any Registration Statement.







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     “Registration Statement” shall mean any registration statement of the
Company which covers any of the Exchange Bonds or Registrable Bonds pursuant to
the provisions of this Agreement, and all amendments and supplements to any
such Registration Statement, including post-effective amendments, in each case
including the Prospectus contained therein, all exhibits thereto and all
documents incorporated by reference therein.





     “Rule 144(k) Period” shall mean the period of two years (or such shorter
period as may hereafter be referred to in Rule 144(k) under the Securities Act
(or similar successor rule)) commencing on the Closing Date.





     “SEC” shall mean the Securities and Exchange Commission.





     “Securities Act” shall mean the Securities Act of 1933, as amended from
time to time.





     “Shelf Registration” shall mean a registration effected pursuant to
Section 2(b) hereof.





     “Shelf Registration Event” shall have the meaning set forth in Section
2(b) hereof.





     “Shelf Registration Event Date” shall have the meaning set forth in
Section 2(b) hereof.





     “Shelf Registration Statement” shall mean a “shelf” registration statement
of the Company pursuant to the provisions of Section 2(b) hereof which covers
all of the Registrable Bonds (except Registrable Bonds which the Holders have
elected not to include in such Shelf Registration Statement or the Holders of
which have not complied with their obligations under the penultimate paragraph
of Section 3 hereof or under the first paragraph of Section 2(b) hereof) on an
appropriate form under Rule 415 under the Securities Act, or any similar rule
that may be adopted by the SEC, and all amendments and supplements to such
registration statement, including post-effective amendments, in each case
including the Prospectus contained therein, all exhibits thereto and all
documents incorporated by reference therein.





     “Special Interest Premium” shall have the meaning set forth in Section
2(e) hereof.





     “TIA” shall have the meaning set forth in Section 3(m) hereof.





     “Trustee” shall mean the trustee under the Indenture.





     2.     Registration Under the Securities Act.





     (a)  Exchange Offer. Except as set forth in Section 2(b) below, the
Company shall, for the benefit of the Holders, at the Company’s cost, (i) file
with the SEC within 90th
calendar days after the Closing Date an Exchange Offer Registration
Statement on an appropriate form under the Securities Act relating to the
Exchange Offer, (ii) use its reasonable best efforts to cause such Exchange
Offer Registration Statement to be declared effective under the Securities Act
by the SEC not later than the date which is 180 calendar days after the Closing
Date, and (iii) provided such Exchange Offer Registration Statement has been
declared effective under the Securities Act by the SEC, commence the Exchange
Offer and keep the Exchange Offer open for not less than 30 days, or longer if
required by applicable law, after the date on which such Registration Statement
was declared effective by the SEC (such period referred to




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herein as the
“Exchange Period”) and at the termination thereof, issue Exchange Bonds in
exchange for all Registrable Bonds tendered prior thereto in the Exchange
Offer.





     Each Holder of Registrable Bonds to be exchanged in the Exchange Offer
shall be required, as a condition to participating in the Exchange Offer, to
represent that it acquires the Exchange Bonds in the ordinary course of such
Holder’s business and that it (i) is not an Affiliate of the Company, (ii) does
not hold any Bonds to be exchanged for Exchange Bonds in the Exchange Offer
that were acquired other than in the ordinary course of business, (iii) is not
a broker-dealer tendering Registrable Bonds acquired directly from the Company,
(iv) at the time of the Exchange Offer, has no arrangements or understandings
with any Person to participate in the Exchange Offer for the purpose of
distributing the Exchange Bonds.





     In connection with the Exchange Offer, the Company shall:





     (i)  mail to each Holder a copy of the Prospectus forming part of the
Exchange Offer Registration Statement, together with an appropriate letter. of
transmittal and related documents;





     (ii)  utilize the services of the Depositary for the Exchange Offer with
respect to Bonds represented by a global certificate;





     (iii)  permit Holders to withdraw tendered Registrable Bonds at any time
prior to the close of business, New York City time, on the last Business Day of
the Exchange Period, by sending to the institution specified in the notice to
Holders, a telegram, telex, facsimile transmission or letter setting forth the
name of such Holder, the principal amount of Registrable Bonds delivered for
exchange, and a statement that such Holder is withdrawing his election to have
such Registrable Bonds exchanged;





     (iv)  notify each Holder that any Registrable Security not tendered by such
Holder in the Exchange Offer will remain outstanding and continue to accrue
interest but will not retain any rights under this Agreement (except in the
case of the Initial Purchasers and Participating Broker-Dealers as provided
herein); and





     (v)  otherwise comply in all material respects with all applicable laws and
regulations relating to the Exchange Offer.





     As soon as practicable after the close of the Exchange Offer, the Company
shall:





     (i)  accept for exchange all Registrable Bonds or portions thereof duly
tendered and not validly withdrawn pursuant to the Exchange Offer in accordance
with the terms of the Exchange Offer Registration Statement and letter of
transmittal;





     (ii)  deliver, or cause to be delivered, to the Trustee for cancellation
all Registrable Bonds or portions thereof so accepted for exchange by the
Company; and





     (iii) issue, and cause the Trustee under the Indenture to promptly
authenticate and deliver to each Holder, Exchange Bonds equal in principal
amount to the principal amount of the Bonds as are surrendered by such Holder.







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     Interest on each Exchange Bond issued pursuant to the Exchange Offer will
accrue from the last date on which interest was paid or duly provided for on
the Bond surrendered in exchange therefor or, if no interest has been paid on
such Bond, from the date of original issue of such Bond. To the extent not
prohibited by any judicial order, judgment, law, regulation or applicable
interpretation of the staff of the SEC, the Company shall use its reasonable
best efforts to complete the Exchange Offer as provided above, and shall comply
with the applicable requirements of the Securities Act, the Exchange Act and
other applicable laws and regulations in connection with the Exchange Offer.
The Exchange Offer shall not be subject to any conditions other than the
conditions referred to in Section 2(b)(i) and (ii) below and those conditions
that are customary in similar exchange offers, except as may be required by
applicable law. Each Holder of Registrable Bonds who wishes to exchange such
Registrable Bonds for Exchange Bonds in the Exchange Offer will be required to
make certain customary representations in connection therewith, including, in
the case of any Holder, representations that (i) it is not an Affiliate of the
Company, (ii) it is not a broker-dealer tendering Registrable Bonds acquired
directly from the Company, (iii) the Bonds being exchanged, and the Exchange
Bonds to be received, by it have been or are being acquired in the ordinary
course of its business and (iv) at the time of the Exchange Offer, it has no
arrangements or understandings with any Person to participate in the
distribution (within the meaning of the Securities Act) of the Exchange Bonds.
The Company shall inform the Initial Purchasers, after consultation with the
Trustee, of the names and addresses of the Holders to whom the Exchange Offer
is made, and the Initial Purchasers shall have the right to contact such
Holders in order to facilitate the tender of Registrable Bonds in the Exchange
Offer.





     Upon consummation of the Exchange Offer in accordance with this Section
2(a), the provisions of this Agreement shall continue to apply, mutatis
mutandis, solely with respect to Exchange Bonds held by Initial Purchasers and
Participating Broker-Dealers, and the Company shall have no further obligation
to register the Registrable Bonds held by any other Holder pursuant to Section
2(b) of this Agreement.





     (b)  Shelf Registration. If (i) because of any change in law, regulation
or in currently prevailing interpretations thereof by the staff of the SEC, the
Company is not permitted to effect the Exchange Offer as contemplated by
Section 2(a) hereof, (ii) the Exchange Offer is not consummated within 210 days
after the Closing Date or (iii) any Holder of Registrable Bonds that is a
“qualified institutional buyer” (as defined in Rule 144A under the Securities
Act) shall notify the Company prior to the 20th day following the consummation
of the Exchange Offer (A) that such Holder was prohibited by applicable law or
SEC policy from participating in
the Exchange Offer, or (B) that such Holder may not resell the Exchange
Bonds acquired by it in the Exchange Offer to the public without delivering a
prospectus and that the Prospectus contained in the Exchange Offer Registration
Statement is not appropriate or available for such resales by such Holder, or
(C) that such Holder is a Participating Broker-Dealer and holds Bonds acquired
directly from the Company or one of its Affiliates (any of the events specified
in (i), (ii) or (iii) being a “Shelf Registration Event”, and the date of
occurrence thereof, the “Shelf Registration Event Date”), then in addition to
or in lieu of conducting the Exchange Offer contemplated by Section 2(a), as
the case may be, the Company shall promptly notify the Holders in writing
thereof and shall, at its cost, file as promptly as practicable after such
Shelf Registration Event Date and, in any event, within 90 days after such
Shelf Registration Event Date, a Shelf Registration Statement providing for the
sale by the Holders of all of the




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Registrable Bonds (other than Registrable
Bonds owned by Holders who have elected not to include such Registrable Bonds
in such Shelf Registration Statement or who have not complied with their
obligations under the penultimate paragraph of Section 3 hereof or under this
paragraph), and shall use its reasonable best efforts to cause such Shelf
Registration Statement to be declared effective by the SEC as soon as
practicable and in any event, on or before the 120th day after the Shelf
Registration Event Date or, if later, the 210th day after the Closing Date. No
Holder of Registrable Bonds shall be entitled to include any of its Registrable
Bonds in any Shelf Registration pursuant to this Agreement unless and until
such Holder agrees in writing to be bound by all of the provisions of this
Agreement applicable to such Holder and furnishes to the Company in writing,
within 15 days after receipt of a request therefor, such information as the
Company may, after conferring with counsel with regard to information relating
to Holders that would be required by the SEC to be included in such Shelf
Registration Statement or Prospectus included therein, reasonably request for
inclusion in any Shelf Registration Statement or Prospectus included therein.
Each Holder as to which any Shelf Registration is being effected agrees to
furnish to the Company, without request and as soon as practicable, all
information with respect to such Holder necessary to make the information
previously furnished to the Company by such Holder not materially misleading.





     The Company agrees to use its reasonable best efforts to keep the Shelf
Registration Statement continuously effective and the Prospectus usable for
resales for the earlier of (x) the expiration of the Rule 144(k) Period or (y)
such time as all of the Bonds covered by the Shelf Registration Statement have
been sold pursuant to the Shelf Registration Statement or cease to be
Registrable Bonds (the period from the effective date of the Shelf Registration
Statement until the earlier of the events described in clauses (x) or (y) being
the “Effectiveness Period”). The Company shall not permit any securities other
than Registrable Bonds to be included in the Shelf Registration. The Company
will, in the event a Shelf Registration Statement is declared effective,
provide to each Holder of Registrable Bonds covered thereby, a reasonable
number of copies of the Prospectus which is a part of the Shelf Registration
Statement, notify each such Holder when the Shelf Registration has become
effective and take any other action required to permit unrestricted resales of
the Registrable Bonds. The Company further agrees to supplement or amend the
Shelf Registration Statement, if required by the rules, regulations or
instructions applicable to the registration form used by the Company for such
Shelf Registration Statement or by the Securities Act or by any other rules and
regulations thereunder for shelf registrations, and the Company agrees to
furnish to the Holders of Registrable Bonds covered by such Shelf Registration
Statement copies of any such supplement or amendment promptly after its being
used or filed with the SEC.





     (c)  Expenses. The Company shall pay all Registration Expenses in
connection with any Registration Statement filed pursuant to Section 2(a)
and/or 2(b) hereof and will reimburse the Initial Purchasers for the reasonable
fees and disbursements Simpson Thacher & Bartlett incurred in connection with
the Exchange Offer. Except as provided herein, each Holder shall pay all
expenses of its counsel, underwriting discounts and commissions and transfer
taxes, if any, relating to the sale or disposition of such Holder’s Registrable
Bonds pursuant to the Shelf Registration Statement.





     (d)  Effective Registration Statement. An Exchange Offer Registration
Statement pursuant to Section 2(a) hereof or a Shelf Registration Statement
pursuant to Section




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2(b) hereof will not be deemed to have become effective
unless it has been declared effective by the SEC; provided, however, that if,
after it has been declared effective, the offering of Registrable Bonds
pursuant to such Exchange Offer Registration Statement or Shelf Registration
Statement is interfered with by any stop order, injunction or other order or
requirement of the SEC or any other governmental agency or court, such Exchange
Offer Registration Statement or Shelf Registration Statement will be deemed not
to have been effective during the period of such interference, until the
offering of Registrable Bonds pursuant to such Registration Statement may
legally resume. The Company will be deemed not to have used its reasonable best
efforts to cause the Exchange Offer Registration Statement or the Shelf
Registration Statement, as the case may be, to become, or to remain, effective
during the requisite period if it voluntarily takes any action that would
result in any such Registration Statement not being declared effective or that
would result in the otherwise eligible Holders of Registrable Bonds covered
thereby not being able to exchange or offer and sell such Registrable Bonds
during that period, unless such action is required by applicable law or
regulation or permitted by Section 2(b)(iv)(B).





     (e)  Special Interest Premium. In the event that:






		
	 	     (i) the Exchange Offer Registration Statement is not filed with the
SEC on or prior to the 90th day after the Closing Date, then, commencing
on the 91st day after the Closing Date, a special interest premium (the
“Special Interest Premium”) shall accrue on the principal amount of the
Bonds at a rate of 0.50% per annum;




		
	 	     (ii) the Exchange Offer Registration Statement is not declared
effective by the SEC on or prior to the 180th day after the Closing Date,
then, commencing on the 181st day after the Closing Date, a Special
Interest Premium shall accrue on the principal amount of the Bonds at a
rate of 0.50% per annum;




		
	 	     (iii) (A) the Company has not exchanged Exchange Bonds for all Bonds
validly tendered, in accordance with the terms of the Exchange Offer, on
or prior to the 210th day after the Closing Date or (B) if the Shelf
Registration Statement is required to be filed pursuant to Section 2(b)
but is not declared effective by the SEC on or prior to the 210th day
after the Closing Date, then, commencing on the 211th day after the
Closing Date, a Special Interest Premium shall accrue on the principal
amount of the Bonds at the rate of 0.50% per annum; or




		
	 	     (iv) the Shelf Registration Statement has been declared effective
and such Shelf Registration Statement ceases to be continuously effective
or the Prospectus
contained in such Shelf Registration Statement ceases to be usable
for resales (A) at any time prior to the expiration of the Effectiveness
Period or (B) if related to corporate developments, public filings with
the SEC or similar events or because the Prospectus contains an untrue
statement of a material fact or omits to state a material fact required
to be stated therein or necessary in order to make the statements therein
not misleading, and such failure continues for more than 60 days (whether
or not consecutive and whether or not arising out of a single or multiple
circumstances) in any twelve-month period, then the Special Interest
Premium shall accrue on the principal amount of the Bonds at a rate of
0.50% per annum commencing on the day that (in the case of (A) above), or
the 61st (cumulative) day after (in the case of (B) above), such Shelf
Registration Statement





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	 	ceases to be effective or the Prospectus ceases to
be usable for resales; provided, however, that the aggregate amount of
the Special Interest Premium in respect of the Bonds may not exceed 0.50%
per annum (regardless of whether multiple events triggering a Special
Interest Premium under this subsection (e) exist); provided, further,
however, that (1) upon the filing of the Exchange Offer Registration
Statement (in the case of clause (i) above), (2) upon the effectiveness
of the Exchange Offer Registration Statement (in the case of clause (ii)
above), (3) upon the exchange of Exchange Bonds for all Bonds validly
tendered (in the case of clause (iii)(A) above) or upon the effectiveness
of the Shelf Registration Statement (in the case of clause (iii)(B)
above) and (4) upon the earlier of (y) such time as the Shelf
Registration Statement which had ceased to remain effective or the
Prospectus which had ceased to be usable for resales again becomes
effective and usable for resales, as applicable, and (z) the expiration
of the Effectiveness Period (in each case of clause (iv) above), the
Special Interest Premium on the principal amount of the Bonds as a result
of such clause (or the relevant subclause thereof) shall cease to accrue.



     Any Special Interest Premium due pursuant to Section 2(e)(i), (ii), (iii)
or (iv) above will be payable in cash on the next succeeding February 28 or
August 28, as the case may be, to eligible Holders (as determined under this
subsection (e)) on the relevant record dates for the payment of interest
pursuant to the Indenture.





     (f)  Specific Enforcement. Without limiting the remedies available to the
Holders, the Company acknowledges that any failure by the Company to comply
with its obligations under Section 2(a) and Section 2(b) hereof may result in
material irreparable injury to the Holders for which there is no adequate
remedy at law, that it would not be possible to measure damages for such
injuries precisely and that, in the event of any such failure, any Holder may
obtain such relief as may be required to specifically enforce the Company’s
obligations under Section 2(a) and Section 2(b) hereof.





     3.     Registration Procedures. In connection with the obligations of the
Company with respect to the Registration Statements pursuant to Sections 2(a)
and 2(b) hereof, the Company shall:






		
	 	     (a) prepare and file with the SEC a Registration Statement or
Registration Statements as prescribed by Sections 2(a) and 2(b) hereof
within the relevant time period specified in Section 2 hereof on the
appropriate form under the Securities Act, which
form shall (i) be selected by the Company, (ii) in the case of a
Shelf Registration, be available for the sale of the Registrable Bonds by
the selling Holders thereof and, in the case of an Exchange Offer, be
available for the exchange of Registrable Bonds, and (iii) comply as to
form in all material respects with the requirements of the applicable
form and include all financial statements required by the SEC to be filed
therewith; and use its reasonable best efforts to cause such Registration
Statement to become effective and remain effective (and, in the case of a
Shelf Registration Statement, the Prospectus to be usable for resales) in
accordance with Section 2 hereof; provided, however, that if (1) such
filing is pursuant to Section 2(b), or (2) a Prospectus contained in an
Exchange Offer Registration Statement filed pursuant to Section 2(a) is
required to be delivered under the Securities Act by any Participating
Broker-Dealer who seeks to sell Exchange





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	 	Bonds, before filing any
Registration Statement or Prospectus or any amendments or supplements
thereto, the Company shall furnish to and afford the Holders of the
Registrable Bonds and each such Participating Broker-Dealer, as the case
may be, covered by such Registration Statement, their counsel and the
managing underwriters, if any, a reasonable opportunity to review copies
of all such documents (including copies of any documents to be
incorporated by reference therein and all exhibits thereto) proposed to
be filed; and the Company shall not file any Registration Statement or
Prospectus or any amendments or supplements thereto in respect of which
the Holders must be afforded an opportunity to review prior to the filing
of such document if the Majority Holders of the Registrable Bonds,
depending solely upon which Holders must be afforded the opportunity of
such review, or such Participating Broker-Dealer, as the case may be,
their counsel or the managing underwriters, if any, shall reasonably
object in a timely manner;




		
	 	     (b) prepare and file with the SEC such amendments and post-effective
amendments to each Registration Statement as may be necessary to keep
such Registration Statement effective for the Effectiveness Period or the
Applicable Period, as the case may be, and cause each Prospectus to be
supplemented, if so determined by the Company or requested by the SEC, by
any required prospectus supplement and as so supplemented to be filed
pursuant to Rule 424 (or any similar provision then in force) under the
Securities Act, and comply with the provisions of the Securities Act, the
Exchange Act and the rules and regulations promulgated thereunder
applicable to it with respect to the disposition of all Bonds covered by
each Registration Statement during the Effectiveness Period or the
Applicable Period, as the case may be, in accordance with the intended
method or methods of distribution by the selling Holders thereof
described in this Agreement (including sales by any Participating
Broker-Dealer);




		
	 	     (c) in the case of an Exchange Offer Registration Statement, if in
the reasonable opinion of counsel to the Company there is a question as
to whether the Exchange Offer is permitted by applicable law, seek a
no-action letter or other favorable decision from the SEC allowing the
Company to consummate an Exchange Offer for such Bonds; the Company
hereby agrees to pursue the issuance of such a decision to the SEC staff
level but shall not be required to take commercially unreasonable action
to effect a change of SEC policy; the Company hereby agrees, however, to
(i) participate in telephonic conferences with the SEC, (ii) deliver to
the SEC staff an analysis prepared by counsel to the Company setting
forth the legal bases, if any, upon which such counsel has concluded
that such an Exchange Offer should be permitted and (iii) diligently
pursue a resolution (which need not be favorable) by the SEC staff of
such submission;




		
	 	     (d) in the case of an Exchange Offer Registration Statement, prior
to the effectiveness of such statement, provide a supplemental letter to
the SEC (i) stating that the Company is registering the Exchange Offer in
reliance on the position of the SEC enunciated in Exxon Capital Holdings
Corporation (available May 13, 1988), Morgan Stanley and Co. Inc.
(available June 5, 1991), Brown & Wood LLP (available February 7, 1997)
and, if applicable, any no-action letter obtained pursuant to Section
3(c) and (ii) including a representation that the Company has not entered
into any arrangement or understanding with any Person to distribute the
Exchange Bonds to be received in the Exchange Offer and that, to the best
of the Company’s information and belief, each





10







 




		
	 	Holder participating in the Exchange Offer is acquiring the Exchange Bonds in its ordinary course of
business and has no arrangement or understanding with any Person to
participate in the distribution of the Exchange Bonds received in the
Exchange Offer;




		
	 	     (e) in the case of a Shelf Registration, (i) notify each Holder of
Registrable Bonds included in the Shelf Registration Statement, at least
three Business Days prior to filing, that a Shelf Registration Statement
with respect to the Registrable Bonds is being filed and advising such
Holder that the distribution of Registrable Bonds will be made in
accordance with the method selected by the Majority Holders of the
Registrable Bonds, (ii) furnish to each Holder of Registrable Bonds
included in the Shelf Registration Statement and to each underwriter of
an underwritten offering of Registrable Bonds, if any, without charge, as
many copies of each Prospectus, including each preliminary prospectus,
and any amendment or supplement thereto, and such other documents as such
Holder or underwriter may reasonably request, in order to facilitate the
public sale or other disposition of the Registrable Bonds and (iii)
consent to the use of the Prospectus or any amendment or supplement
thereto by each of the selling Holders of Registrable Bonds included in
the Shelf Registration Statement in connection with the offering and sale
of the Registrable Bonds covered by the Prospectus or any amendment or
supplement thereto;




		
	 	     (f) in the case of a Shelf Registration, register or qualify the
Registrable Bonds under all applicable state securities or “blue sky”
laws of such jurisdictions by the time the applicable Registration
Statement is declared effective by the SEC as any Holder of Registrable
Bonds covered by a Registration Statement and each underwriter of an
underwritten offering of Registrable Bonds shall reasonably request in
writing in advance of such date of effectiveness, and do any and all
other acts and things which may be reasonably necessary or advisable to
enable such Holder and underwriter to consummate the disposition in each
such jurisdiction of such Registrable Bonds owned by such Holder;
provided, however, that the Company shall not be required to (i) qualify
as a foreign corporation or as a dealer in securities in any jurisdiction
where it would not otherwise be required to qualify but for this Section
3(f), (ii) file any general consent to service of process in any
jurisdiction where it would not otherwise be subject to such service of
process or (iii) subject itself to taxation in any such jurisdiction if
it is not then so subject;
	 
	 	     (g) (1) in the case of a Shelf Registration or (2) if Participating
Broker-Dealers from whom the Company has received prior written notice
that they will be utilizing the Prospectus contained in the Exchange
Offer Registration Statement as provided in Section 3(u) hereof, are
seeking to sell Exchange Bonds and are required to deliver Prospectuses,
promptly notify each Holder of Registrable Bonds, or such Participating
Broker-Dealers, as the case may be, their counsel and the managing
underwriters, if any, and promptly confirm such notice in writing (i)
when a Registration Statement has become effective and when any
post-effective amendments thereto become effective, (ii) of any request
by the SEC or any state securities authority for amendments and
supplements to a Registration Statement or Prospectus or for additional
information after the Registration Statement has become effective, (iii)
of the issuance by the SEC or any state securities authority of any stop
order suspending the effectiveness of a Registration





11







 




		
	 	Statement or the
qualification of the Registrable Bonds or the Exchange Bonds to be
offered or sold by any Participating Broker-Dealer in any jurisdiction
described in Section 3(f) hereof or the initiation of any proceedings for
that purpose, (iv) in the case of a Shelf Registration, if, between the
effective date of a Registration Statement and the closing of any sale of
Registrable Bonds covered thereby, the representations and warranties of
the Company contained in any purchase agreement, securities sales
agreement or other similar agreement cease to be true, correct and
complete in all material respects, (v) of the happening of any event or
the failure of any event to occur or the discovery of any facts, during
the Effectiveness Period, which makes any statement, made in such
Registration Statement or the related Prospectus untrue in any material
respect or which causes such Registration Statement or Prospectus to omit
to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made,
not misleading, as well as any other corporate developments, public
filings with the SEC or similar events causing such Registration
Statement not to be effective or the Prospectus not to be useable for
resales and (vi) of the reasonable determination of the Company that a
post-effective amendment to the Registration Statement would be
appropriate;




		
	 	     (h) obtain the withdrawal of any order suspending the effectiveness
of a Registration Statement as soon as practicable;




		
	 	     (i) in the case of a Shelf Registration, furnish to each Holder of
Registrable Bonds included within the coverage of such Shelf Registration
Statement, without charge, at least one conformed copy of each
Registration Statement relating to such Shelf Registration and any
post-effective amendment thereto (without documents incorporated therein
by reference or exhibits thereto, unless requested);




		
	 	     (j) in the case of a Shelf Registration, cooperate with the selling
Holders of Registrable Bonds to facilitate the timely preparation and
delivery of certificates representing Registrable Bonds to be sold and
not bearing any restrictive legends (except any customary legend borne by
securities held through The Depository Trust Company or any similar
depository) and in such denominations (consistent with the provisions of
the Indenture and the officer’s certificate establishing the forms and
the terms of the Bonds pursuant to the Indenture) and registered in such
names as the selling Holders or the underwriters may reasonably request
(provided such names are consistent with the names
of the selling securityholders set forth in the Shelf Registration
Statement) at least two Business Days prior to the closing of any sale of
Registrable Bonds pursuant to such Shelf Registration Statement;




		
	 	     (k) in the case of a Shelf Registration or an Exchange Offer
Registration, promptly after the occurrence of any event specified in
Section 3(g)(ii), 3(g)(iii), 3(g)(v) (subject to the 60-day cumulative
grace period within any twelve-month period provided for in Section
2(e)(iv)(B)) or 3(g)(vi) hereof, prepare a supplement or post-effective
amendment to such Registration Statement or the related Prospectus or any
document incorporated therein by reference or file any other required
document so that, as thereafter delivered to the purchasers of the
Registrable Bonds, such Prospectus will not include any untrue statement
of a material fact or omit to state a material fact necessary to





12







 




		
	 	make the
statements therein, in the light of the circumstances under which they
were made, not misleading; and the Company shall notify each Holder to
suspend use of the Prospectus as promptly as practicable after the
occurrence of such an event, and each Holder hereby agrees to suspend use
of the Prospectus until the Company has amended or supplemented the
Prospectus to correct such misstatement or omission;




		
	 	     (l) obtain a CUSIP number for the Exchange Bonds or the Registrable
Bonds, as the case may be, not later than the effective date of a
Registration Statement, and provide the Trustee with certificates for the
Exchange Bonds or the Registrable Bonds, as the case may be, in a form
eligible for deposit with the Depositary;




		
	 	     (m) cause the Indenture to be qualified under the Trust Indenture
Act of 1939, as amended (the “TIA”), in connection with the registration
of the Exchange Bonds or Registrable Bonds, as the case may be, and
effect such changes to such documents as may be required for them to be
so qualified in accordance with the terms of the TIA and execute, and
cause the Trustee to execute, all documents as may be required to effect
such changes, and all other forms and documents required to be filed with
the SEC to enable such documents to be so qualified in a timely manner;




		
	 	     (n) in the case of a Shelf Registration, enter into such agreements
(including underwriting agreements) as are customary in underwritten
offerings and take all such other appropriate actions in connection
therewith as are reasonably requested by the Holders of at least 25% in
aggregate principal amount of the Registrable Bonds in order to expedite
or facilitate the registration or the disposition of the Registrable
Bonds;




		
	 	     (o) in the case of a Shelf Registration, whether or not an
underwriting agreement is entered into and whether or not the
registration is an underwritten registration, if requested by (x) an
Initial Purchaser, in the case where such Initial Purchaser holds Bonds
acquired by it as part of its initial placement, or (y) Holders of at
least 25% in aggregate principal amount of the Registrable Bonds covered
thereby: (i) make such representations and warranties to Holders of such
Registrable Bonds and the underwriters (if any), with respect to the
business of the Company as then conducted and the Registration Statement,
Prospectus and documents, if any, incorporated or deemed to be
incorporated by reference therein, in each case, as are customarily made
by issuers to underwriters in underwritten offerings, and confirm the
same if and when requested; (ii)
obtain opinions of counsel to the Company and updates thereof (which
may be in the form of a reliance letter) in form and substance reasonably
satisfactory to the managing underwriters (if any) and the Holders of a
majority in amount of the Registrable Bonds being sold, addressed to each
selling Holder and the underwriters (if any) covering the matters
customarily covered in opinions requested in underwritten offerings and
such other matters as may be reasonably requested by such underwriters
(it being agreed that the matters to be covered by such opinion may be
subject to customary qualifications and exceptions); (iii) obtain “cold
comfort” letters and updates thereof in form and substance reasonably
satisfactory to the managing underwriters from the independent certified
public accountants of the Company, addressed to each of the underwriters,
such letters to be in customary form and covering matters of the type
customarily covered in “cold comfort” letters in connection with
underwritten offerings and such other matters as





13







 




		
	 	reasonably requested by
such underwriters in accordance with Statement on Auditing Standards No.
72; and (iv) if an underwriting agreement is entered into, the same shall
contain indemnification provisions and procedures no less favorable than
those set forth in Section 4 hereof (or such other provisions and
procedures acceptable to Holders of a majority in aggregate principal
amount of Registrable Bonds covered by such Registration Statement and
the managing underwriters) customary for such agreements with respect to
all parties to be indemnified pursuant to said Section (including,
without limitation, such underwriters and selling Holders); and in the
case of an underwritten registration, the above requirements shall be
satisfied at each closing under the related underwriting agreement or as
and to the extent required thereunder;




		
	 	     (p) if (1) a Shelf Registration is filed pursuant to Section 2(b) or
(2) a Prospectus contained in an Exchange Offer Registration Statement
filed pursuant to Section 2(a) is required to be delivered under the
Securities Act by any Participating Broker-Dealer who seeks to sell
Exchange Bonds during the Applicable Period, make reasonably available
for inspection by any selling Holder of Registrable Bonds or
Participating Broker-Dealer, as applicable, who certifies to the Company
that it has a current intention to sell Registrable Bonds pursuant to the
Shelf Registration, any underwriter participating in any such disposition
of Registrable Bonds, if any, and any attorney, accountant or other agent
retained by any such selling Holder, Participating Broker-Dealer, as the
case may be, or underwriter (collectively, the “Inspectors”), at the
offices where normally kept, during the Company’s normal business hours,
all financial and other records, pertinent organizational and operational
documents and properties of the Company and the Parent (collectively, the
“Records”) as shall be reasonably necessary to enable them to conduct due
diligence activities, and cause the officers, trustees and employees of
the Company and the Parent to supply all relevant information in each
case reasonably requested by any such Inspector in connection with such
Registration Statement; Records and information which the Company
determines, in good faith, to be confidential and any Records and
information which it notifies the Inspectors are confidential shall not
be disclosed to any Inspector except where (i) the disclosure of such
Records or information is necessary to avoid or correct a material
misstatement or omission in such Registration Statement, (ii) the release
of such Records or information is ordered pursuant to a subpoena or other
order from a court of competent jurisdiction or is necessary in
connection with any action, suit or proceeding or (iii) such Records or
information previously has been made generally available to the public;
each selling
Holder of such Registrable Bonds and each such Participating
Broker-Dealer will be required to agree in writing that Records and
information obtained by it as a result of such inspections shall be
deemed confidential and shall not be used by it as the basis for any
market transactions in the securities of the Company unless and until
such is made generally available to the public through no fault of an
Inspector or a selling Holder; and each selling Holder of such
Registrable Bonds and each such Participating Broker-Dealer will be
required to further agree in writing that it will, upon learning that
disclosure of such Records or information is sought in a court of
competent jurisdiction, or in connection with any action, suit or
proceeding, give notice to the Company and allow the Company at its
expense to undertake appropriate action to prevent disclosure of the
Records and information deemed confidential;





14







 




		
	 	     (q) comply with all applicable rules and regulations of the SEC so
long as any provision of this Agreement shall be applicable and make
generally available to its security holders earning statements satisfying
the provisions of Section 11(a) of the Securities Act and Rule 158
thereunder (or any similar rule promulgated under the Securities Act) no
later than 45 days after the end of any 12-month period (or 90 days after
the end of any 12-month period if such period is a fiscal year) (i)
commencing at the end of any fiscal quarter in which Registrable Bonds
are sold to underwriters in a firm commitment or best efforts
underwritten offering and (ii) if not sold to underwriters in such an
offering, commencing on the first day of the first fiscal quarter of the
Company after the effective date of a Registration Statement, which
statements shall cover said 12-month periods, provided that the
obligations under this paragraph (q) shall be satisfied by the timely
filing of quarterly and annual reports on Forms 10-Q and 10-K under the
Exchange Act;




		
	 	     (r) if an Exchange Offer is to be consummated, upon delivery of the
Registrable Bonds by Holders to the Company (or to such other Person as
directed by the Company), in exchange for the Exchange Bonds, the Company
shall mark, or cause to be marked, on such Bonds delivered by such
Holders that such Bonds are being cancelled in exchange for the Exchange
Bonds; it being understood that in no event shall such Bonds be marked as
paid or otherwise satisfied;




		
	 	     (s) cooperate with each seller of Registrable Bonds covered by any
Registration Statement and each underwriter, if any, participating in the
disposition of such Registrable Bonds and their respective counsel in
connection with any filings required to be made with the NASD;




		
	 	     (t) prior to issuing the Exchange Notes, obtain all regulatory and
governmental approvals necessary for the issuance of the Exchange Notes,
including, without limitation, any required orders or consents of the
Minnesota Public Utilities Commission or under the Public Utility Holding
Company Act of 1935 pertaining to the Company’s capital structure;




		
	 	     (u) take all other steps necessary to effect the registration of the
Registrable Bonds covered by a Registration Statement contemplated
hereby; and
	 
	 	     (v) (A) in the case of the Exchange Offer Registration Statement (i)
include in the Exchange Offer Registration Statement a section entitled
“Plan of Distribution,” which section shall be reasonably acceptable to
the Initial Purchasers or another representative of the Participating
Broker-Dealers, and which shall contain a summary statement of the
positions taken or policies made by the staff of the SEC with respect to
the potential “underwriter” status of any broker-dealer that holds
Registrable Bonds acquired for its own account as a result of
market-making activities or other trading activities (a “Participating
Broker-Dealer”) and that will be the beneficial owner (as defined in Rule
13d-3 under the Exchange Act) of Exchange Bonds to be received by such
broker-dealer in the Exchange Offer, whether such positions or policies
have been publicly disseminated by the staff of the SEC or such positions
or policies, in the reasonable judgment of the Initial Purchasers or such
other representative, represent the prevailing





15







 




		
	 	views of the staff of the
SEC, including a statement that any such broker-dealer who receives
Exchange Bonds for Registrable Bonds pursuant to the Exchange Offer may
be deemed a statutory underwriter and must deliver a prospectus meeting
the requirements of the Securities Act in connection with any resale of
such Exchange Bonds, (ii) furnish to each Participating Broker-Dealer who
has delivered to the Company the notice referred to in Section 3(g),
without charge, as many copies of each Prospectus included in the
Exchange Offer Registration Statement, including any preliminary
Prospectus, and any amendment or supplement thereto, as such
Participating Broker-Dealer may reasonably request (the Company hereby
consents to the use of the Prospectus forming part of the Exchange Offer
Registration Statement or any amendment or supplement thereto by any
Person subject to the prospectus delivery requirements of the Securities
Act, including all Participating Broker-Dealers, in connection with the
sale or transfer of the Exchange Bonds covered by the Prospectus or any
amendment or supplement thereto), (iii) use its reasonable best efforts
to keep the Exchange Offer Registration Statement effective and to amend
and supplement the Prospectus contained therein in order to permit such
Prospectus to be lawfully delivered by all Persons subject to the
prospectus delivery requirements of the Securities Act for such period of
time as such Persons must comply with such requirements under the
Securities Act and applicable rules and regulations in order to resell
the Exchange Bonds; provided, however, that such period shall not be
required to exceed 210 days (or such longer period if extended pursuant
to the last sentence of Section 3 hereof) (the “Applicable Period”), and
(iv) include in the transmittal letter or similar documentation to be
executed by an exchange offeree in order to participate in the Exchange
Offer (x) the following provision:




		
	 	     “If the exchange offeree is a broker-dealer holding
Registrable Bonds acquired for its own account as a
result of market-making activities or other trading
activities, it will deliver a prospectus meeting the
requirements of the Securities Act in connection with
any resale of Exchange Bonds received in respect of
such Registrable Bonds pursuant to the Exchange
Offer”;




		
	 	and (y) a statement to the effect that by a Participating Broker-Dealer
making the acknowledgment described in clause (x) and by delivering a
Prospectus in connection with the exchange of Registrable Bonds, the
Participating Broker-Dealer will not be deemed to admit that it is an
underwriter within the meaning of the Securities Act; and
	 
	 	(B) in the case of any Exchange Offer Registration Statement, the Company
agrees to deliver to the Initial Purchasers or to another representative
of the Participating Broker-Dealers, if reasonably requested by an
Initial Purchaser or such other representative of Participating
Broker-Dealers, on behalf of the Participating Broker-Dealers upon
consummation of the Exchange Offer (i) an opinion of counsel in form and
substance reasonably satisfactory to such Initial Purchaser or such other
representative of the Participating Broker-Dealers, covering the matters
customarily covered in opinions requested in connection with Exchange
Offer Registration Statements and such other matters as may be reasonably
requested (it being agreed that the matters to be covered by such opinion
may be subject to customary qualifications and exceptions), (ii) an
officer’s certificate substantially similar to that specified in Section
7(h) of the Purchase





16







 




		
	 	Agreement and such additional certifications as are
customarily delivered in a public offering of debt bonds and (iii) upon
the effectiveness of the Exchange Offer Registration Statement, comfort
letters, in each case, in customary form if permitted by Statement on
Auditing Standards No. 72.



     The Company may require each seller of Registrable Bonds as to which any
registration is being effected to furnish to the Company such information
regarding such seller as may be required by the staff of the SEC to be included
in a Registration Statement. The Company may exclude from such registration the
Registrable Bonds of any seller who unreasonably fails to furnish such
information within a reasonable time after receiving such request. The Company
shall have no obligation to register under the Securities Act the Registrable
Bonds of a seller who so fails to furnish such information and, notwithstanding
anything to the contrary herein, no Special Interest Premium shall accrue on
any such Registrable Bonds.





     In the case of a Shelf Registration Statement, or if Participating
Broker-Dealers who have notified the Company that they will be utilizing the
Prospectus contained in the Exchange Offer Registration Statement as provided
in this Section 3(u) are seeking to sell Exchange Bonds and are required to
deliver Prospectuses, each Holder agrees that, upon receipt of any notice from
the Company of the occurrence of any event specified in Section 3(g)(ii),
3(g)(iii), 3(g)(v) or 3(g)(vi) hereof, such Holder will forthwith discontinue
disposition of Registrable Bonds pursuant to a Registration Statement until
such Holder’s receipt of the copies of the supplemented or amended Prospectus
contemplated by Section 3(k) hereof or until it is advised in writing (the
“Advice”) by the Company that the use of the applicable Prospectus may be
resumed, and, if so directed by the Company, such Holder will deliver to the
Company (at the Company’s expense) all copies in such Holder’s possession,
other than permanent file copies then in such Holder’s possession, of the
Prospectus covering such Registrable Bonds or Exchange Bonds, as the case may
be, current at the time of receipt of such notice. If the Company shall give
any such notice to suspend the disposition of Registrable Bonds or Exchange
Bonds, as the case may be, pursuant to a Registration Statement, the Company
shall use its reasonable best efforts to file and have declared effective (if
an amendment), as soon as practicable after the resolution of the related
matters, an amendment or supplement to the Registration Statement and shall
extend the period during which such Registration Statement is required to be
maintained effective and the Prospectus usable for resales pursuant to this
Agreement by the number of days in the period from and including the date of
the giving of such notice to and including the date when the Company shall have
made available to the Holders (x)
copies of the supplemented or amended Prospectus necessary to resume such
dispositions or (y) the Advice.







17







 


     4.     Indemnification and Contribution. (a) In connection with a Shelf
Registration Statement or in connection with any delivery of a Prospectus
contained in an Exchange Offer Registration Statement by any Participating
Broker-Dealer or Initial Purchaser, as applicable, who seeks to sell Exchange
Bonds, the Company shall indemnify and hold harmless each Holder of Registrable
Bonds included within any such Shelf Registration Statement and each
Participating Broker-Dealer or Initial Purchaser selling Exchange Bonds, and
each Person, if any, who controls any such Person within the meaning of Section
15 of the Securities Act:






		
	 	     (i) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of, or based upon, any untrue
statement or alleged untrue statement of a material fact contained in any
Registration Statement (or any amendment or supplement thereto), covering
Registrable Bonds or Exchange Bonds, as applicable, or the omission or
alleged omission therefrom of a material fact required to be stated or
necessary in order to make the statements therein not misleading or
arising out of any untrue statement or alleged untrue statement of a
material fact contained in any Prospectus, or the omission or alleged
omission therefrom of a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading;




		
	 	     (ii) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission; provided that any such settlement
is effected with the prior written consent of the Company; and




		
	 	     (iii) against any and all expenses whatsoever, as incurred
(including the reasonable fees and disbursements of counsel chosen by
such Holder, such Participating Broker-Dealer, or any underwriter (except
to the extent otherwise expressly provided in Section 4(c) hereof)),
reasonably incurred in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental agency
or body, commenced or threatened, or any claim whatsoever based upon any
such untrue statement or omission, or any such alleged untrue statement
or omission, to the extent that any such expense is not paid under
subparagraph (i) or (ii) of this Section 4(a);



provided, however, that this indemnity does not apply to any loss, liability,
claim, damage or expense to the extent arising out of (i) an untrue statement
or omission or alleged untrue statement or omission made in reliance upon and
in conformity with written information furnished in writing to the Company by
the Initial Purchasers or any Holder, underwriter or Participating
Broker-Dealer for use in a Registration Statement (or any amendment thereto) or
any Prospectus (or any amendment or supplement thereto) or (ii) the failure of
any Holder to comply with the provisions of the last paragraph of Section 3.





     (b)  Each of the Initial Purchasers and each Holder, underwriter or
Participating Broker-Dealer agrees, severally and not jointly, to indemnify and
hold harmless the Company and each Person, if any, who controls the Company
within the meaning of Section 15




18







 



of the Securities Act or Section 20 of the
Exchange Act, against any and all loss, liability, claim, damage and expense
whatsoever described in the indemnity contained in Section 4(a) hereof, as
incurred, but only with respect to untrue statements or omissions, or alleged
untrue statements or omissions, made in a Registration Statement (or any
amendment thereto) or any Prospectus (or any amendment or supplement thereto)
in reliance upon and in conformity with written information furnished to the
Company by such Initial Purchaser, Holder, underwriter or Participating
Broker-Dealer expressly for use in such Registration Statement (or any
amendment thereto), or any such Prospectus (or any amendment or supplement
thereto); provided, however, that in the case of a Shelf Registration
Statement, no such Holder shall be liable for any claims hereunder in excess of
the amount of net proceeds received by such Holder from the sale of Registrable
Bonds pursuant to such Shelf Registration Statement.





     (c)  Each indemnified party shall give notice as promptly as reasonably
practicable to each indemnifying party of any action commenced against it in
respect of which indemnity may be sought hereunder, but failure to so notify an
indemnifying party shall not relieve such indemnifying party from any liability
which it may have under this Section 4 to the extent that it is not materially
prejudiced by such failure as a result thereof, and in any event shall not
relieve it from liability which it may have otherwise on account of this
Agreement. In the case of parties indemnified pursuant to Section 4(a) or (b)
above, if any claim or action shall be brought against an indemnified party,
and it shall notify the indemnifying party thereof, the indemnifying party
shall be entitled to participate therein and, to the extent that it wishes,
jointly with any other similarly notified indemnifying party, to assume the
defense thereof with counsel reasonably satisfactory to the indemnified party.
After notice from the indemnifying party to the indemnified party of its
election to assume the defense of such claim or action, the indemnifying party
shall not be liable to the indemnified party under this Section 4 for any legal
or other expenses subsequently incurred by the indemnified party in connection
with the defense thereof other than reasonable costs of investigation;
provided, however, any indemnified party shall have the right to employ
separate counsel in any such action and to participate in the defense thereof
but the fees and expenses of such counsel in any such action and to participate
in the defense thereof but the fees and expenses of such counsel shall be at
the expense of such indemnified party unless (i) the employment thereof has
been specifically authorized by the indemnifying party in writing, (ii) such
indemnified party shall have been advised by such counsel that there may be one
or more legal defenses available to it that are different from or additional to
those available to the indemnifying party and in the reasonable judgment of
such counsel it is advisable for such indemnified party to employ separate
counsel or (iii) the indemnifying party has failed to assume the defense of
such action and employ counsel reasonably satisfactory to the indemnified
party, in which case, if such indemnified party notifies the indemnifying party
in writing that it elects to employ separate counsel at the expense of the
indemnifying party, the indemnifying party shall not have the right to assume
the defense of such action on behalf of such indemnified party, it being
understood, however, that the indemnifying party shall not, in connection with
any one such action or separate but substantially similar or related actions in
the same jurisdiction arising our of the same general allegations or
circumstances, be liable for the reasonable fees and expenses of more than one
separate firm of attorneys (in addition to local counsel) at any time for all
such indemnified parties, which firm shall be designated in writing
by Lehman Brothers Inc., if the indemnified parties under this Section 4
consist of any Initial Purchaser or any of their respective officers, employees
or controlling persons, or by the Compqany, if the indemnified parties under
this Section 4 consist of the Company or any of the




19







 



Company’s directors,
officers or controlling persons. Each indemnified party, as a condition of the
indemnity agreements contained in Sections 4(a) and 4(b) shall use its best
efforts to cooperate with the indemnifying party in the defense of any such
action or claim. No indemnifying party shall (i) without the prior written
consent of the indemnified parties (which consent shall not be unreasonably
withheld), settle or compromise or consent to the entry of any judgment with
respect to any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim whatsoever
in respect of which indemnification or contribution could be sought under this
Section 4 (whether or not the indemnified parties are actual or potential
parties thereto), unless such settlement, compromise or consent includes an
unconditional written release of each indemnified party from all liability
arising out of such litigation, investigation, proceeding or claim or (ii) be
liable for any settlement of any such action effected without its written
consent (which consent shall not be unreasonably withheld), but if settled with
the consent of the indemnifying party or if there be a final judgment of the
plaintiff in any such action, the indemnifying party agrees to indemnify and
hold harmless any indemnified party from and against any loss or liability by
reason of such settlement or judgment.





     (d)  In order to provide for just and equitable contribution in
circumstances under which any of the indemnity provisions set forth in this
Section 4 is for any reason held to be unenforceable by an indemnified party
although applicable in accordance with its terms, the Company and the Holders
shall contribute to the aggregate losses, liabilities, claims, damages and
expenses of the nature contemplated by such indemnity agreement incurred by the
Company and the Holders, as incurred; provided, however, that no Person guilty
of fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any Person that was not
guilty of such fraudulent misrepresentation. As between the Company and the
Holders, such parties shall contribute to such aggregate losses, liabilities,
claims, damages and expenses of the nature contemplated by this Agreement in
such proportion as shall be appropriate to reflect the relative fault of the
Company, on the one hand, and the Holders, on the other hand, with respect to
the statements or omissions which resulted in such loss, liability, claim,
damage or expense, or action in respect thereof, as well as any other relevant
equitable considerations. The relative fault of the Company, on the one hand,
and of the Holders, on the other hand, shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company, on the one hand, or by or on
behalf of the Holders, on the other, and the parties’ relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Company and the Holders agree that it would not be
just and equitable if contribution pursuant to this Section 4 were to be
determined by pro rata allocation or by any other method of allocation that
does not take into account the relevant equitable considerations. For purposes
of this Section 4, each Affiliate of a Holder, and each director, officer and
employee and Person, if any, who controls a Holder or such Affiliate within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act
shall have the same rights to contribution as such Holder and each Person, if
any, who controls the Company within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act shall have the same rights to
contribution as the Company.





     5.     Participation in an Underwritten Registration. No Holder may
participate in an underwritten registration hereunder unless such Holder (a)
agrees to sell such Holder’s




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Registrable Bonds on the basis provided in the
underwriting arrangement approved by the Persons entitled hereunder to approve
such arrangements and (b) completes and executes all reasonable questionnaires,
powers of attorney, indemnities, underwriting agreements, lock-up letters and
other documents reasonably required under the terms of such underwriting
arrangements.





     6.     Selection of Underwriters. The Holders of Registrable Bonds covered by
the Shelf Registration Statement who desire to do so may sell the Bonds covered
by such Shelf Registration in an underwritten offering, subject to the
provisions of Section 3(l) hereof. In any such underwritten offering, the
underwriter or underwriters and manager or managers that will administer the
offering will be selected by the Holders of a majority in aggregate principal
amount of the Registrable Bonds included in such offering; provided, however,
that such underwriters and managers must be reasonably satisfactory to the
Company.





     7.     Miscellaneous.





     (a)  Rule 144 and Rule 144A. For so long as the Company is subject to the
reporting requirements of Section 13 or 15 of the Exchange Act and any
Registrable Bonds remain outstanding, the Company will file the reports
required to be filed by it under the Securities Act and Section 13(a) or 15(d)
of the Exchange Act and the rules and regulations adopted by the SEC
thereunder; provided, however, that if the Company ceases to be so required to
file such reports, it will, upon the request of any Holder of Registrable
Bonds, (a) make publicly available such information as is necessary to permit
sales of its securities pursuant to Rule 144 under the Securities Act, (b)
deliver such information to a prospective purchaser as is necessary to permit
sales of its securities pursuant to Rule 144A under the Securities Act, and (c)
take such further action that is reasonable in the circumstances, in each case,
to the extent required from time to time to enable such Holder to sell its
Registrable Bonds without registration under the Securities Act within the
limitation of the exemptions provided by (i) Rule 144 under the Securities Act,
as such rule may be amended from time to time, (ii) Rule 144A under the
Securities Act, as such rule may be amended from time to time, or (iii) any
similar rules or regulations hereafter adopted by the SEC. Upon the request of
any Holder of Registrable Bonds, the Company will deliver to such Holder a
written statement as to whether it has complied with such requirements.





     (b)  No Inconsistent Agreements. The Company and the Parent have not
entered into, nor will the Company or the Parent on or after the date of this
Agreement enter into, any agreement which is inconsistent with the rights
granted to the Holders of Registrable Bonds in this Agreement or otherwise
conflicts with the provisions hereof without the written consent of Holders of
a majority in aggregate principal amount of the outstanding Registrable Bonds.
The rights granted to the Holders hereunder do not in any way conflict with and
are not
inconsistent with the rights granted to the holders of the Company’s or
the Parent’s other issued and outstanding securities under any such agreements.





     (c)  Amendments and Waivers. The provisions of this Agreement, including
the provisions of this sentence, may not be amended, modified or supplemented,
and waivers or consents to departures from the provisions hereof may not be
given, unless the Company has obtained the written consent of Holders of a
majority in aggregate principal amount of the




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outstanding Registrable Bonds
affected by such amendment, modification, supplement, waiver or departure;
provided that no amendment, modification or supplement or waiver or consent to
the departure with respect to the provisions of Section 4 hereof shall be
effective as against any Holder of Registrable Bonds unless consented to in
writing by such Holder of Registrable Bonds. Notwithstanding the foregoing
sentence, (i) this Agreement may be amended, without the consent of any Holder
of Registrable Bonds, by written agreement signed by the Company and the
Initial Purchasers, to cure any ambiguity, correct or supplement any provision
of this Agreement that may be inconsistent with any other provision of this
Agreement or to make any other provisions with respect to matters or questions
arising under this Agreement which shall not be inconsistent with other
provisions of this Agreement, (ii) this Agreement may be amended, modified or
supplemented, and waivers and consents to departures from the provisions hereof
may be given, by written agreement signed by the Company and the Initial
Purchasers to the extent that any such amendment, modification, supplement,
waiver or consent is, in their reasonable judgment, necessary or appropriate to
comply with applicable law and regulation (including any interpretation of the
Staff of the SEC) or any change therein and (iii) to the extent any provision
of this Agreement relates to an Initial Purchaser, such provision may be
amended, modified or supplemented, and waivers or consents to departures from
such provisions may be given, by written agreement signed by such Initial
Purchaser and the Company.





     (d)  Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand-delivery, registered
first-class mail, telex, telecopier, or any courier guaranteeing overnight
delivery (i) if to a Holder, at the most current address given by such Holder
to the Company by means of a notice given in accordance with the provisions of
this Section 7(d), which address initially is, with respect to the Initial
Purchasers:






	 	c/o Lehman Brothers Inc.

745 Seventh Avenue

New York, NY 10019

Attention: Debt Capital Markets, Global Power







and (ii) if to the Company, initially at the Company’s address:






	 	Northern States Power Company.

414 Nicollet Mall

Minneapolis, MN 55401

Attn: General Counsel







and thereafter at such other address, notice of which is given in accordance
with the provisions of this Section 7(d).





     All such notices and communications shall be deemed to have been duly
given at the time delivered by hand, if personally delivered; five Business
Days after being deposited in the mail, postage prepaid, if mailed; when
answered back, if telexed; when receipt is acknowledged, if telecopied; and on
the next Business Day, if timely delivered to an air courier guaranteeing
overnight delivery.







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     Copies of all such notices, demands, or other communications shall be
concurrently delivered by the Person giving the same to the Trustee, at the
address specified in the Indenture.





     (e)  Successors and Assigns. This Agreement shall inure to the benefit of
and be binding upon the successors, assigns and transferees of the Initial
Purchasers, including, without limitation and without the need for an express
assignment, subsequent Holders; provided, however, that nothing herein shall be
deemed to permit any assignment, transfer or other disposition of Registrable
Bonds in violation of the terms of the Purchase Agreement or the Indenture. If
any transferee of any Holder shall acquire Registrable Bonds in any manner,
whether by operation of law or otherwise, such Registrable Bonds shall be held
subject to all of the terms of this Agreement, and by taking and holding such
Registrable Bonds, such Person shall be conclusively deemed to have agreed to
be bound by and to perform all of the terms and provisions of this Agreement
and such Person shall be entitled to receive the benefits hereof.





     (f)  Third Party Beneficiaries. Each Holder and any Participating
Broker-Dealer shall be third party beneficiaries of the agreements made
hereunder among the Initial Purchasers and the Company, and the Initial
Purchasers shall have the right to enforce such agreements directly to the
extent it deems such enforcement necessary or advisable to protect its rights
or the rights of Holders hereunder.





     (g)  Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.





     (h)  Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.





     (i)  GOVERNING LAW. THIS AGREEMENT SHALL BE DEEMED TO HAVE BEEN MADE IN
THE STATE OF NEW YORK. THE VALIDITY AND INTERPRETATION OF THIS AGREEMENT, AND
THE TERMS AND CONDITIONS SET FORTH HEREIN, SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.





     (j)  Severability. In the event that any one or more of the provisions
contained herein, or the application thereof in any circumstance, is held
invalid, illegal or unenforceable, the validity, legality and enforceability of
any such provision in every other respect and of the remaining provisions
contained herein shall not be affected or impaired thereby.





     (k) Bonds Held by the Company or its Affiliates. Whenever the consent or
approval of Holders of a specified percentage of Registrable Bonds is required
hereunder,
Registrable Bonds held by the Company or its Affiliates shall not be
counted in determining whether such consent or approval was given by the
Holders of such required percentage.







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     IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.






	 	 	 
	 	NORTHERN STATES POWER COMPANY
	 	  	 
	 	By:	 



	 
	 	 	
Name:
	 	 	 
	 	 	
Title:



Confirmed and accepted as of

the date first above written:






LEHMAN BROTHERS INC.






By:   LEHMAN BROTHERS INC.







	 	For itself and as Representative of the

several Initial Purchasers
	 	 
	By:	 




	 	Authorized Signatory












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