Exhibit 10.1(O)


 


MEMORANDUM OF ENGAGEMENT


William (“Bill”) M. Austin


NorthWestern Corporation


 


This
memorandum outlines the general terms and conditions of NorthWestern
Corporation’s (“NorthWestern” or the “Company”) continued retention during the
course of its pending Chapter 11 case (the “Chapter 11 Case”) of William
(“Bill”) M. Austin (“Austin”) in the capacity of Chief Restructuring Officer as
follows:


 


1.             Services:


 


Austin shall continue to serve as NorthWestern’s Chief Restructuring
Officer providing advice and information to the Company in connection with the
Chapter 11 Case.  Austin’s primarily
responsibility is to advise on the operational and financial restructuring of
the Company as is normal and customary in chapter 11 cases for chief
restructuring officers, such services to include, but not be limited to,
management of operational bankruptcy “task forces” established within
NorthWestern, developing a long-term business strategy and business plan,
overseeing the financial balance sheet restructuring of the Company, and
overseeing the disposition of assets of non-core businesses such as Expanets,
Inc. and Blue Dot, inc., assisting in the formulation and presentation of a
reorganization plan for confirmation in the Chapter 11 Case, obtaining and negotiating
debtor-in-possession financing for the Company in the Chapter 11 Case and, as
necessary, obtaining, negotiating and implementing exit financing.


 


2.             Term:  For a period of the earlier of eighteen (18) months from
September 15, 2003 or effective date of confirmed reorganization plan for
NorthWestern, unless extended by mutual agreement between NorthWestern and
Austin.


 


3.             Compensation:


 


(A)          Base salary – $400,000 per year;


 


(B)           Time-based addition – $400,000, to be paid
in three installments of $133.333 on each of March 15, 2004, September 15, 2004
and March 15, 2005;


 


(C)           Incentive-based addition – $800,000, to be
paid as follows:


 


(i)            $233,333 upon execution of restructure term
sheer with Official Committee of Unsecured Creditors appointed in the Chapter
11 Case or those holders of at least 55% of NorthWestern’s senior unsecured
bonds;


 


(ii)           $233,333 upon entry of Order approving a
disclosure statement in the Chapter 11 Case; and


 

















 


(iii)          $233,333 upon the effective date of a
confirmed reorganization plan in the Chapter 11 Case;


 


(D)          If effective date of reorganization plan
occurs before completion of distributions to be made under (A), (B) and (C)
above, then distributions and payments not yet made will be fully earned and
will be paid on effective date.


 


(E)           To receive the compensation provided for in
(A), (B), (C) and (D) above, Austin must remain engaged as Chief Restructuring
Officer for the Company.  If and to the
extent that Austin’s continued engagement as Chief Restructuring Officer of
NorthWestern has been involuntary terminated by the Company or otherwise as a
result of the Chapter 11 Case, Austin shall receive payments required to be
made to him under this Section 3 and not yet made, plus shall receive severance
in the amount of $400,000 to be paid in equal monthly installments over a
period of one year following the effective date of his termination.


 


4.             Expense Reimbursement:


 


In addition to the compensation paid as outlined in Section 3 above,
NorthWestern agrees to reimburse Austin for all reasonable out-of -pocket
expenses incurred by Austin in carrying out the terms of his engagement as
Chief Restructuring Officer, including communication charges, travel expenses,
copy expenses, delivery and distribution charges and such other reasonable
costs and expenses incurred by Austin in the performance of his duties as Chief
Restructuring Officer.  All
reimbursements shall be made promptly after such payments accrue and are
submitted to NorthWestern with appropriate documentation for the payment
hereunder.


 


5.             Termination
and Severance:


 


NorthWestern or Austin may, at any time, terminate Austin’s continued
engagement as Chief Restructuring Officer without liability or continuing
obligation, by providing thirty (30) days prior written notice thereof to the
other party; provided, however, that except as otherwise provided in Section 3
of this Memorandum of Engagement, no termination of Austin’s continued
engagement as Chief Restructuring Officer shall affect Austin’s right to
receive, and the Company’s obligation to pay, (a) any claims for
indemnification as provided for under this Memorandum of engagement or (b) the
compensation to be paid to Austin as provided for in Section 3 of this
Memorandum of Engagement.


 


6.             Indemnification:


 


NorthWestern agrees to indemnify and hold harmless Austin against
losses, claims, damages or liabilities (or actions or proceedings in respect
thereof) in connection with Austin’s engagement as Chief Reconstruction Officer
and will reimburse Austin for all


 


2

















 


reasonable and other expenses as incurred in connection with
investigating or defending any such loss, claim, damage, liability, action or
proceeding; provided, however, that NorthWestern will not be liable in any such
case for losses, claims, damages, liabilities or expenses which are finally
judicially determined to have resulted primarily from the gross negligence or
willful misconduct of Austin.


 


7.             Survival:


 


The provisions of Sections 3 and 7 of this Memorandum of Engagement
shall survive the termination or expiration of Austin’s continued engagement as
Chief Restructuring Officer.


 


 


	
   

  	
  NORTHWESTERN CORPORATION

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Gary Drook

  	
   

  
	
   

  	
   

  	
  Gary Drook

  
	
   

  	
   

  	
  Chief Executive Officer

  
	
   

  	
  Date:

  	
  September 29, 2003

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/

  	
   

  
	
   

  	
  WILLIAM M. AUSTIN

  
	
   

  	
  Chief Restructuring Officer

  
	
   

  	
  Date: September     , 2003

  



 


3

















 


ORIGINAL


 


IN THE UNITED STATES
BANKRUPTCY COURT


FOR THE DISTRICT OF DELAWARE


 




	
  In re:

  	
  :

  	
  Chapter 11

  
	
   

  	
  :

  	
   

  
	
  NORTHWESTERN CORPORATION,

  	
  :

  	
  Case No. 03-12872 (CGC)

  
	
   

  	
  :

  	
   

  
	
   

  	
  Debtor.

  	
  :

  	
  Ref. Docket No. 102

  
	
   

  	
   

  	
  :

  	
   

  
	
   

  	
   

  	
  :

  	
   

  






 


ORDER
AUTHORIZING DEBTOR TO RETAIN WILLIAM


AUSTIN AS
ITS CHIEF RESTRUCTURING OFFICER


 


UPON the Motion
Pursuant to §§ 105(a) and 363 of the Bankruptcy Code for Approval of Agreement
to Retain William Austin as Chief Restructuring Officer of the Debtor (the
“Motion”) filed by the above-captioned debtor (the “Debtor”) and the Court
having reviewed the Motion; and having heard the statements of counsel
regarding the relief requested in the Motion at a hearing with respect to the
Motion; and the Court having found that it has jurisdiction over this matter
pursuant to 28 U.S.C. §§ 157 and 1334; and due notice of the Motion having been
given under the circumstances; and it appearing that no other or further notice
of the Motion is necessary or required; and the Court having determined that
the relief requested in the Motion is in the best interests of the Debtor, its
estate, its creditors and other parties-in-interest; and after due deliberation
and sufficient cause appearing therefor, it is hereby


 


ORDERED, that the
Motion is GRANTED; and it is
further


 

















 


ORDERED, that the
Debtor is hereby authorized to retain William Austin as its chief restructuring
officer on the terms set forth in the Agreement(1), as such Agreement is
modified herein; and it is further


 


ORDERED, that the
Incentive-based compensation provided for in the Agreement shall be payable to
William Austin on an interim basis subject to final application and review pursuant
to Section 330 of the Bankruptcy Code; and it is further


 


ORDERED, that
notwithstanding Section 3(C) of the Agreement, the Incentive-based additional
compensation shall be paid as follows: (1) $400,000 upon entry of an order
approving a disclosure statement in the Debtor’s Chapter 11 case; and (2)
$400,000 upon the effective date of a confirmed reorganization plan in the
Debtor’s Chapter 11 case; and it is further


 


ORDERED, that
notwithstanding Section 3(E) of the Agreement, the severance payments described
therein shall be in addition to payments required to be made under Section 3 to
the extent that the triggering events related thereto have occurred; and it is
further


 


ORDERED, that this
order shall take effect immediately upon its entry; and it is further


 


ORDERED, that this
Court shall retain jurisdiction to hear and determine all matters arising from
the implementation of this order.


 


 


	
  Dated:

  	
  Wilmington, Delaware

  	
   

  	
   

  
	
   

  	
  October 10, 2003

  	
   

  	
   

  
	
   

  	
   

  	
  /s/ [ILLEGIBLE]

  



 












(1)           Any capitalized term
used herein but not otherwise defined shall have the meaning ascribed to such
term in the Motion.