Document:

uil_exh4-3.htm

    EXHIBIT
4.3

    

    
      	
              
                Final
      Version

              

            

    

    

     

    The
United Illuminating Company

     

    
      	
              $50,000,000
      6.46% Senior Notes, Series A, due November 3,
  2018

            

    

    
      	
              $50,000,000
      6.51% Senior Notes, Series B, due December 1,
    2018

            

    

    
      	
              $50,000,000
      6.61% Senior Notes, Series C, due December 1,
    2020

            

    

    

     

    Note
Purchase Agreement

     

    Dated as
of July 29, 2008

     

    
      	 
      

    

    

    

    

    
      
        
          Exh 4.3 NPA Final 8K.doc

          1687300

        

         

      

      
         

        
          

        

      

      
         

      

    

    Table
of Contents

    
      	
              Section

            	
              Heading

            	
              Page

            
	
              Section
      1.

            	
              Authorization
      of Notes

            	
                1

            
	
              Section
      2.

            	
              Sale
      and Purchase of Notes

            	
                1

            
	
              Section
      3.

            	
              Execution
      Date: Closings

            	
                2

            
	
              Section
      4.

            	
              Conditions
      to Closings

            	
                2

            
	
              Section 4.1

            	
              Representations
      and Warranties

            	
                2

            
	
              Section 4.2

            	
              Performance,
      No Default

            	
                2

            
	
              Section 4.3

            	
              Compliance
      Certificates

            	
                3

            
	
              Section 4.4

            	
              Opinions
      of Counsel

            	
                3

            
	
              Section 4.5

            	
              Purchase
      Permitted by Applicable Law, Etc

            	
                3

            
	
              Section 4.6

            	
              Payment
      of Special Counsel Fees

            	
                3

            
	
              Section 4.7

            	
              Private
      Placement Number

            	
                3

            
	
              Section 4.8

            	
              Changes
      in Corporate Structure

            	
                3

            
	
              Section 4.9

            	
              Proceedings
      and Documents

            	
                4

            
	
              Section 4.10

            	
              Sale
      of Notes to Purchasers

            	
                4

            
	
              Section 4.11

            	
              Funding
      Instructions

            	
                4

            
	
              Section 4.12

            	
              Governmental
      Authorizations, Etc.

            	
                4

            
	
              Section
      5

            	
              Representations
      and Warranties of the Company

            	
                4

            
	
              Section 5.1

            	
              Organization;
      Power and Authority

            	
                4

            
	
              Section 5.2

            	
              Authorization,
      Etc

            	
                4

            
	
              Section 5.3

            	
              Disclosure

            	
                5

            
	
              Section 5.4

            	
              Organization
      and Ownership of Shares of Subsidiaries

              Affiliates

            	
                5

            
	
              Section 5.5

            	
              Financial
      Statements

            	
                6

            
	
              Section 5.6

            	
              Compliance
      with Laws, Other Instruments, Etc

            	
                6

            
	
              Section 5.7

            	
              Governmental
      Authorizations, Etc

            	
                6

            
	
              Section 5.8

            	
              Litigation,
      Observance of Agreements, Statutes and Orders

            	
                6

            
	
              Section 5.9

            	
              Taxes

            	
                7

            
	
              Section 5.10

            	
              Title
      of Property: Leases

            	
                7

            
	
              Section 5.11

            	
              Licenses,
      Permits, Etc

            	
                7

            
	
              Section 5.12

            	
              Compliance
      with ERISA

            	
                7

            
	
              Section 5.13

            	
              Private
      Offering by the Company

            	
                9

            
	
              Section 5.14

            	
              Use
      of Proceeds; Margin Regulations

            	
                9

            
	
              Section 5.15

            	
              Existing
      Indebtedness

            	
                9

            
	
              Section 5.16

            	
              Foreign
      Assets Control Regulations, Etc.

            	
                9

            
	
              Section 5.17

            	
              Status
      Under Certain Statutes

            	
              10

            
	
              Section 5.18

            	
              Environmental
      Matters

            	
              10

            

    

    

    
      
        
           

        

         

      

      
        - i
-

        
          

        

      

      
         

      

    

    

    
      	
              Section 6.

            	
              Representations
      of the Purchaser

            	
              11

            
	
              Section 6.1.

            	
              Purchase
      of Notes

            	
              11

            
	
              Section 6.2.

            	
              Source
      of Funds

            	
              11

            
	
              Section 6.3.

            	
              Accredited
      Investor

            	
              12

            
	
              Section 7.

            	
              Information
      as to Company

            	
              13

            
	
              Section 7.1.

            	
              Financial
      and Business Information

            	
              13

            
	
              Section 7.2.

            	
              Officer’s
      Certificate

            	
              15

            
	
              Section 7.3.

            	
              Inspection

            	
              15

            
	
              Section 8.

            	
              Prepayment
      of the Notes

            	
              16

            
	
              Section 8.1.

            	
              Optional
      Prepayments with Make-Whole Amount

            	
              16

            
	
              Section 8.2.

            	
              Notice
      of Prepayment

            	
              16

            
	
              Section 8.3.

            	
              Allocation
      of Partial Prepayments

            	
              17

            
	
              Section 8.4.

            	
              Maturity;
      Surrender, Etc

            	
              17

            
	
              Section 8.5.

            	
              Purchase
      of Notes

            	
              17

            
	
              Section 8.6.

            	
              Make-Whole
      Amount

            	
              17

            
	
              Section 9.

            	
              Affirmative
      Covenants

            	
              18

            
	
              Section 9.1.

            	
              Compliance
      with Law

            	
              18

            
	
              Section 9.2.

            	
              Insurance

            	
              19

            
	
              Section 9.3.

            	
              Maintenance
      of Properties

            	
              19

            
	
              Section 9.4.

            	
              Payment
      of Taxes and Claims

            	
              19

            
	
              Section 9.5.

            	
              Corporate
      Existence, Etc

            	
              19

            
	
              Section 10.

            	
              Negative
      Covenants

            	
              19

            
	
              Section 10.1.

            	
              Maintenance
      of Consolidated Indebtedness

            	
              19

            
	
              Section 10.2.

            	
              Subsidiary
      Indebtedness

            	
              20

            
	
              Section 10.3.

            	
              Liens

            	
              20

            
	
              Section 10.4.

            	
              Limitation
      on Sale and Leaseback Transactions

            	
              22

            
	
              Section 10.5.

            	
              Disposition
      of Assets

            	
              22

            
	
              Section 10.6.

            	
              Merger,
      Consolidation, Etc

            	
              23

            
	
              Section 10.7.

            	
              Transactions
      with Affiliates

            	
              24

            
	
              Section 10.8.

            	
              Terrorism
      Sanctions Regulations

            	
              24

            
	
              Section 11.

            	
              Events
      of Default

            	
              24

            
	
              Section 12.

            	
              Remedies
      on Default, Etc

            	
              26

            
	
              Section 12.1.

            	
              Acceleration

            	
              26

            
	
              Section 12.2.

            	
              Other
      Remedies

            	
              27

            
	
              Section 12.3.

            	
              Rescission

            	
              27

            
	
              Section 12.4.

            	
              No
      Waivers or Election of Remedies, Expenses, Etc

            	
              27

            
	 
      	 
      	 
      

    

    

    
      
        
           

        

         

      

      
        - ii
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              Section 13.

            	
              Registration;
      Exchange; Substitution of Notes

            	
               

            	 
      
	
              Section 13.1.

            	
              Registration
      of Notes

            	
              27

            	 
      
	
              Section 13.2.

            	
              Transfer
      and Exchange of Notes

            	
              28

            	 
      
	
              Section 13.3.

            	
              Replacement
      of Notes

            	
              28

            	 
      
	
              Section 14.

            	
              Payments
      on Notes

            	
              28

            	 
      
	
              Section 14.1.

            	
              Place
      of Payment

            	
              28

            	 
      
	
              Section 14.2.

            	
              Home
      Office Payment

            	
              29

            	 
      
	
              Section 15.

            	
              Expenses,
      Etc

            	
              29

            	 
      
	
              Section 15.1.

            	
              Transaction
      Expenses

            	
              29

            	 
      
	
              Section 15.2.

            	
              Survival

            	
              30

            	 
      
	
              Section 16.

            	
              Survival
      of Representations and Warranties; Entire Agreement.

            	
              30

            	 
      
	
              Section 17.

            	
              Amendment
      and Waiver

            	
              30

            	 
      
	
              Section 17.1.

            	
              Requirements

            	
              30

            	 
      
	
              Section 17.2.

            	
              Solicitation
      of Holders of Notes

            	
              30

            	 
      
	
              Section 17.3.

            	
              Binding
      Effect, Etc

            	
              31

            	 
      
	
              Section 17.4.

            	
              Notes
      Held by Company, Etc

            	
              31

            	 
      

    

    
      	
              Section 18.

            	
              Notices

            	
              31

            
	
              Section 19.

            	
              Reproduction
      of Documents

            	
              32

            
	
              Section 20.

            	
              Confidential
      Information

            	
              32

            
	
              Section 21.

            	
              Substitution
      of Purchaser

            	
              33

            
	
              Section 22.

            	
              Miscellaneous

            	
              33

            
	
              Section 22.1.

            	
              Successors
      and Assigns

            	
              33

            
	
              Section 22.2.

            	
              Construction

            	
              34

            
	
              Section 22.3.

            	
              Consent
      to Jurisdiction; Service of Process; Waiver of Jury Trial

            	
              34

            
	
              Section 22.4.

            	
              Payments
      Due on Non-Business Days

            	
              35

            
	
              Section 22.5.

            	
              Severability

            	
              35

            
	
              Section 22.6.

            	
              Accounting
      Terms

            	
              35

            
	
              Section 22.7.

            	
              Counterparts

            	
              35

            
	
              Section 22.8.

            	
              Governing
      Law

            	
              35

            

    

    
      
        
           

        

         

      

      
        - iii
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                Exhibit
      1-A

              	
                —

              	
                Form
      of 6.46% Senior Note, Series A, due November 3,
    2018

              
	
                Exhibit
      1-B

              	
                —

              	
                Form
      of 6.51% Senior Note, Series B, due December 1,
  2018

              
	
                Exhibit
      1-C

              	
                —

              	
                Form
      of 6.61% Senior Note, Series C, due December 1,
    2020

              
	
                Exhibit
      2

              	
                —

              	
                Form
      of Funds Delivery Instruction Letter

              
	
                Exhibit
      4.4(a)

              	
                —

              	
                Form
      of Opinion of Counsel for the Company

              
	
                Exhibit
      4.4(b)

              	
                —

              	
                Form
      of Opinion of Special Counsel for the Purchasers

              
	 
      	 
      	 
      
	
                Schedule
      A

              	
                —

              	
                Names
      and Addresses of Purchasers

              
	
                Schedule
      B

              	
                —

              	
                Defined
      Terms

              
	
                Schedule
      5.3

              	
                —

              	
                Disclosure
      Documents

              
	
                Schedule
      5.4

              	
                —

              	
                Subsidiaries

              
	
                Schedule
      5.5

              	
                —

              	
                Financial
      Statements

              
	
                Schedule
      5.14

              	
                —

              	
                Use
      of Proceeds

              
	
                Schedule
      5.15

              	
                —

              	
                Existing
      Indebtedness – Execution Date

              
	
                Annex
      A

              	
                —

              	
                Existing
      Indebtedness – Each
Closing

              

      

    

    
      
        
           

        

         

      

      
        - iv
-

        
          

        

      

      
         

      

    

    The
United Illuminating Company

    157
Church Street

    PO Box
1564

    New
Haven, CT 06506-0901

    

    
      	
              $50,000,000
      6.46% Senior Notes, Series A, due November 3,
  2018

            

    

    
      	
              $50,000,000
      6.51% Senior Notes, Series B, due December 1,
    2018

            

    

    
      	
              $50,000,000
      6.61% Senior Notes, Series C, due December 1,
    2020

            

    

    

    

    As of
July 29, 2008

    

    To the
Several Purchasers Listed

      in
the Attached Schedule A:

    

    Ladies
and Gentlemen:

     

    The
United Illuminating Company, a Connecticut corporation (the “Company”), agrees with each
of you (sometimes individually a “Purchaser” and collectively
the “Purchasers”) as
follows:

     

    
      	
               
      

            	
              Section 1.Authorization
      of Notes.

            

    

     

    The
Company has duly authorized the issue and sale of (a) $50,000,000 aggregate
principal amount of its 6.46% Senior Notes, Series A, due November 3,
2018 (the “Series A
Notes”), (b) $50,000,000 aggregate principal amount of its 6.51%
Senior Notes, Series B, due December 1, 2018 (the “Series B Notes”) and
(c) $50,000,000 aggregate principal amount of its 6.61% Senior Notes,
Series C, due December 1, 2020 (the “Series C Notes”; the
Series A Notes, the Series B Notes and the Series C Notes being
hereinafter collectively referred to as the “Notes”), to be substantially
in the form set out in Exhibit 1-A, Exhibit 1-B and Exhibit 1-C, as the case
may be.  As used herein, the term “Notes” shall mean all notes
originally delivered pursuant to this Agreement and all notes delivered in
substitution or exchange for any such note and, where applicable, shall include
the singular number as well as the plural.  Certain capitalized and
other terms used in this Agreement are defined in Schedule B; references to a
“Schedule” or an “Exhibit” are, unless otherwise specified, to a Schedule or an
Exhibit attached to this Agreement.

     

    
      	
               
      

            	
              Section 2.Sale
      and Purchase of Notes.

            

    

     

    Subject
to the terms and conditions of this Agreement, the Company will issue and sell
to you and you will severally purchase from the Company, at the Closing provided
for in Section 3, Notes in the principal amount or amounts and of the
series specified opposite your name in Schedule A at the purchase price of
100% of the principal amount thereof.  Your obligations hereunder are
several and not joint obligations and no Purchaser shall have any liability to
any Person for the performance or non-performance by any other Purchaser
hereunder.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    
      	
               
      

            	
              Section 3.Execution
      Date; Closings.

            

    

     

    The
execution and delivery of this Agreement will be made at the offices of Chapman
and Cutler LLP, 111 West Monroe Street, Chicago, Illinois 60603 on July 29,
2008 (the “Execution
Date”). 

     

    The sale
and purchase of the Notes will be made at the offices of Chapman and Cutler LLP,
111 West Monroe Street, Chicago, Illinois 60603, at 10:00 A.M. Chicago time, at
two Closings (individually, a “Closing” and collectively,
the “Closings”).  The
first Closing shall be held on November 3, 2008 (with respect to
$50,000,000 of the Notes), and the second Closing shall be held on
December 1, 2008 (with respect to $100,000,000 of the Notes).  At
each Closing, the Company will deliver to you the Notes of the series to be
purchased by you at such Closing, as set forth opposite your name on
Schedule A, in the form of a single Note for each series of the Notes to be
purchased by you (or such greater number of Notes of each such series in
denominations of at least $100,000 as you may request prior to the Closing),
dated the date of such Closing and registered in your name (or in the name of
your nominee), against delivery by you to the Company or its order of
immediately available funds in the amount of the purchase price therefor by wire
transfer of immediately available funds to the Company’s account in accordance
with Exhibit 2.

     

    If at
either Closing the Company shall fail to tender such Notes to you as provided
above in this Section 3, or any of the conditions specified in Section 4
shall not have been fulfilled to your satisfaction, you shall, at your election,
be relieved of all further obligations under this Agreement, without thereby
waiving any rights you may have by reason of such failure or such
nonfulfillment.

     

    
      	
               
      

            	
              Section 4.Conditions
      to Closings.

            

    

     

    Your
obligation to execute and deliver this Agreement on the Execution Date and your
several obligations to purchase and pay for the Notes to be sold to you at each
Closing are subject to the fulfillment to your satisfaction, prior to or at each
Closing, of the following conditions:

     

    Section 4.1.Representations and
Warranties.  The representations and warranties of the Company
in this Agreement shall be correct when made on the Execution Date and at the
time of such Closing.

     

    Section 4.2.Performance; No
Default.  The Company shall have performed and complied in all
material respects with all agreements and conditions contained in this Agreement
required to be performed or complied with by it prior to or at such Closing and
after giving effect to the issue and sale of the Notes (and the concurrent
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 the
date of the Memorandum that would have been prohibited by Sections 10.1 to 10.7,
inclusive, had such Sections applied since such date.

    
      
        
           

        

         

      

      
        - 2
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    Section 4.3.Compliance
Certificates.

     

    (a)Officer’s
Certificate.  The Company shall have delivered to you an
Officer’s Certificate, dated the Execution Date certifying that the conditions
specified in Section 4.1 have been fulfilled and shall have delivered to
you an Officer’s Certificate, dated the date of such Closing, certifying that
the conditions specified in Sections 4.1, 4.2 and 4.8 have been
fulfilled.

     

    (b)Secretary’s
Certificate.  The Company shall have delivered to you a
certificate of the Secretary or an Assistant Secretary of the Company, dated the
date of such Closing, certifying as to the resolutions attached thereto and
other corporate proceedings relating to the authorization, execution and
delivery of the Notes and this Agreement.

     

    Section 4.4.Opinions of
Counsel.  You shall have received opinions in form and
substance satisfactory to you, dated the date of such Closing (a) from Wiggin
and Dana LLP, independent counsel to the Company, substantially in the form set
forth in Exhibit 4.4(a) and covering such other matters incident to the
transactions contemplated hereby as you or your counsel may reasonably request
(and the Company hereby instructs its counsel to deliver such opinion to you)
and (b) from Chapman and Cutler LLP, your 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 you may reasonably request.

     

    Section 4.5.Purchase Permitted by Applicable
Law, Etc.  On the date of such Closing your purchase of Notes
shall (a) be permitted by the laws and regulations of each jurisdiction to
which you are 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 you 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 hereof.  If requested by you,
you shall have received an Officer’s Certificate certifying as to such matters
of fact as you may reasonably specify to enable you to determine whether such
purchase is so permitted.

     

    Section 4.6.Payment of Special Counsel
Fees.  Without limiting the provisions of Section 15.1,
the Company shall have paid on or before the Execution Date and the date of each
Closing the fees, charges and disbursements of your special counsel referred to
in Section 4.4 to the extent reflected in a statement of such counsel
rendered to the Company at least one Business Day prior to such
Closing.

     

    Section 4.7.Private Placement
Number.  A Private Placement Number issued by Standard &
Poor’s CUSIP Service Bureau (in cooperation with the Securities Valuation Office
of the National Association of Insurance Commissioners) shall have been obtained
for each series of the Notes prior to the date of the first
Closing.

     

    Section 4.8.Changes in Corporate
Structure.  The Company shall not have changed its jurisdiction
of incorporation or been a party to any merger or consolidation or succeeded to
all or

    
      
        
           

        

         

      

      
        - 3
-

        
          

        

      

      
         

      

    

     

    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,
except as permitted pursuant to Section 10.6.

     

    Section 4.9.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 you and your
special counsel, and you and your special counsel shall have received all such
counterpart originals or certified or other copies of such documents as you or
they may reasonably request.

     

    Section 4.10.Sale of Notes to
Purchasers.  Contemporaneously with each Closing, the Company
shall sell to each of the Purchasers and each of the Purchasers shall purchase
the Notes to be purchased by them at such Closing as specified in Schedule
A.

     

    Section 4.11.Funding
Instructions.  At least three Business Days prior to the date
of each Closing, each Purchaser shall have received written instructions signed
by a Responsible Officer on letterhead of the Company confirming the information
specified in Section 3 in the form of
Exhibit 2.

     

    Section 4.12.Governmental Authorizations,
Etc.  All consents, approvals and authorizations of, notices
to, and registrations, filings and declarations with, or other actions by, any
Governmental Authority required for the valid execution, delivery or performance
by the Company of this Agreement or the Notes, including the final approval of
the Connecticut Department of Public Utility Control (the “Final Approval”), shall have
been obtained and the Final Approval shall be in full force and effect on or
before the date of each Closing and all periods of appeal and rehearing by third
parties which have not stipulated to such approval as issued shall have expired
and all conditions contained in any such authorization or waiver which are to be
fulfilled on or prior to the date of such Closing shall have been
fulfilled.

     

    
      	
               
      

            	
              Section 5.Representations
      and Warranties of the Company.

            

    

     

    The
Company represents and warrants to you on the Execution Date and the date of
each Closing that:

     

    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 and the Notes have been duly authorized by
all necessary corporate action on the part of the Company, and this Agreement

    
      
        
           

        

         

      

      
        - 4
-

        
          

        

      

      
         

      

    

     

    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 (a)
applicable bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting the enforcement of creditors’ rights generally and (b) general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law).

     

    Section 5.3.Disclosure.  The
Company, through its agent, Banc of America Securities LLC, has delivered to you
a copy of a Private Placement Memorandum dated June 19, 2008 (together with
the documents incorporated therein by reference, the “Memorandum”), relating to
the transactions contemplated hereby.  This Agreement, the Memorandum,
the documents, certificates or other writings delivered to you by or on behalf
of the Company in connection with the transactions contemplated hereby and
described in Schedule 5.3 (together with the Memorandum, the “Disclosure Documents”), and
the financial statements listed in Schedule 5.5, 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
Memorandum, since December 31, 2007, there has been no change in the
financial condition, operations, business, properties or prospects of the
Company or any Subsidiary other than changes that individually or in the
aggregate could not 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.

     

    Section 5.4.Organization and Ownership of Shares
of Subsidiaries; Affiliates.  (a) Schedule 5.4 contains
(except as noted therein) complete and correct lists (i) of the Company’s
Subsidiaries, showing, as to each Subsidiary, the correct 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) of the Company’s Affiliates, other than
Subsidiaries, and (iii) of the Company’s directors and senior
officers.

     

    (b)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 nonassessable and are
owned by the Company or another Subsidiary free and clear of any Lien (except as
otherwise disclosed in Schedule 5.4).

     

    (c)Each
Subsidiary identified in Schedule 5.4 is a corporation or other legal entity
duly organized, validly existing and in good standing under the laws of its
jurisdiction of organization, and is duly qualified as a foreign corporation or
other legal entity 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.  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.

     

    (d)No
Subsidiary is a party to, or otherwise subject to any legal restriction or any
agreement (other than this Agreement, the agreements listed in Schedule 5.4 and
customary

    
      
        
           

        

         

      

      
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    limitations
imposed by corporate law 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.  The Company has delivered to you copies of the
consolidated financial statements of the Company and its Subsidiaries listed in
Schedule 5.5.  All of said 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 specified in such Schedule and the consolidated results of
their operations and cash flows for the respective periods so specified 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).

     

    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 (a) 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, 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, (b) 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 (c) 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, notice to, or
registration, filing or declaration with, or other action by, any Governmental
Authority is required for the valid execution, delivery or performance by the
Company of this Agreement or the Notes, except for the Connecticut Department of
Public Utility Control, whose final approval shall have been obtained on or
before the date of the first Closing.

     

    Section 5.8.Litigation; Observance of
Agreements, Statutes and.  (a) There are no actions, suits
or proceedings pending or, to the 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, individually or in the aggregate, could reasonably
be expected to have a Material Adverse Effect.

     

    (b)Neither
the Company nor any Subsidiary is in default under any term of any agreement or
instrument to which it is a party or by which it is bound, or any order,
judgment, decree or ruling of any court, arbitrator or Governmental Authority or
is in violation of any applicable law, ordinance, rule or regulation (including
without limitation Environmental Laws) of any Governmental Authority, which
default or violation, individually or in the aggregate, could reasonably be
expected to have a Material Adverse Effect.

    
      
        
           

        

         

      

      
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    Section 5.9.Taxes.  The Company
and its Subsidiaries have filed all tax returns that are required to have been
filed in any jurisdiction, 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 (a)  the amount of which is not
individually or in the aggregate Material or (b) 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 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 United States federal, state or other
taxes for all fiscal periods are adequate.  The United States federal
income tax liabilities of the Company and its Subsidiaries have been determined
by the Internal Revenue Service and paid for all fiscal years up to and
including the fiscal year ended December 31, 2003.  The United States
federal income tax liabilities of the Company and its Subsidiaries have been
included in the consolidated tax return of UIL Holdings beginning with the
fiscal year ended December 31, 2000.

     

    Section 5.10.Title to Property;
Leases.  The Company and its Subsidiaries have good and
sufficient title to their respective properties that individually or in the
aggregate 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 said date (except as
sold or otherwise disposed of in the ordinary course of business and except as
described in Section 10.5(b)), in each case free and clear of Liens
prohibited by this Agreement.  All leases that individually or in the
aggregate 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 individually or in the aggregate are Material, without known
conflict with the rights of others.

     

    (b)To the
best knowledge of the Company, no product of the Company infringes in any
material respect on any license, permit, franchise, authorization, patent,
copyright, proprietary software, service mark, trademark, trade name or other
right owned by any other Person.

     

    (c)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,
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
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 

     

    
      
        
           

        

         

      

      
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    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 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 such penalty or excise tax
provisions or to section 401(a)(29) or 412 of the Code, other than such
liabilities or Liens as would not be individually or in the aggregate
Material.

     

    (b)The
aggregate current value of the assets under the Plan subject to Title IV of
ERISA, as disclosed in the valuation report for the 2006 plan year, exceeded the
present value of the accumulated plan benefits under such Plan, as calculated
under Financial Accounting Standards No. 35 for such year, by
$72,771,088.  For such Plan’s most recently ended plan year, the
aggregate current value of the assets under such Plan, to be disclosed in the
valuation report for such year, is estimated to exceed the present value of the
accumulated plan benefits under the Plan, to be calculated under Financial
Accounting Standards No. 35 for such plan year, by approximately
$63,700,000.  The terms “current value” and “present value” have the
meanings specified in section 3 of ERISA.

     

    (c)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.

     

    (d)The
expected post retirement benefit obligation (determined as of the last day of
the Company’s most recently ended fiscal year in accordance with Financial
Accounting Standards Board Statement No. 106, without regard to liabilities
attributable to continuation coverage mandated by section 4980B of the Code) of
the Company and its Subsidiaries is not expected to have a Material Adverse
Effect.

     

    (e)With
respect to each employee benefit plan, if any, disclosed by you in writing to
the Company in accordance with Section 6.2(c), neither the Company nor any
“affiliate” of the Company (as defined in section V(c) of the QPAM
Exemption) has at this time, nor has exercised at any time during the
immediately preceding year, the authority to appoint or terminate the “QPAM” (as
defined in Part V of the QPAM Exemption) disclosed by you to the Company
pursuant to Section 6.2(c) as manager of any of the assets of any such plan
or to negotiate the terms of any management agreement with such QPAM on behalf
of any such plan, and the Company is not an “affiliate” (as so defined) of such
QPAM.  The Company is not a party in interest with respect to any
employee benefit plan disclosed by you in accordance with Section 6.2(b) or
6.2(e).  The execution and delivery of this Agreement and the issuance
and sale of the Notes at each Closing hereunder will not involve any prohibited
transaction (as such term is defined in section 406(a) of ERISA and
section 4975(c)(1)(A)-(D) of the Code), that could subject the Company or
any holder of a Note to any tax or penalty on prohibited transactions imposed
under said section 4975 of the Code or by section 502(i) of
ERISA.  The representation by the Company in the preceding sentence of
this Section 5.12(e) is made in reliance upon and subject to the accuracy
of your representation in Section 6.2 as to the source of the funds used to
pay the purchase price of the Notes to be purchased by you.

    
      
        
           

        

         

      

      
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    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 any of the same from, or otherwise approached or negotiated in
respect thereof with, any Person other than the Purchasers and not more than 50
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.

     

    Section 5.14.Use of Proceeds; Margin
Regulations.  The Company will apply the net proceeds of the
sale of the Notes as set forth in Schedule 5.14.  No part of the
proceeds from the sale of the Notes hereunder will be used, and no part of the
proceeds of such Indebtedness being repaid was 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.  Schedule 5.15 sets forth a complete and
correct list of all outstanding Indebtedness of the Company and its Subsidiaries
as of the Execution Date, except for those items identified with an asterisk on
Schedule 5.15, the Indebtedness for which such items was calculated as of
July 21, 2008.  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 the giving of 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.  Annex A to be attached hereto on the
date of each Closing will correctly describe all outstanding Indebtedness and
any Liens secured thereby of the Company and its Subsidiaries as of the date of
such Closing.  Since the Execution Date, no Indebtedness has been
created, assumed, incurred or guaranteed in violation of Sections 10.1
through 10.4.

     

    Except as
disclosed in Schedule 5.15, neither the Company nor any Subsidiary has agreed or
consented 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 would not be permitted by
Section 10.3.

     

    Section 5.16.Foreign Assets Control Regulations,
Etc.  (a) Neither the sale of the Notes by the Company
hereunder nor its use of the proceeds thereof will violate the Trading with the
Enemy Act, as amended, or any of the foreign assets control regulations of the
United States Treasury Department (31 CFR, Subtitle B, Chapter V, as
amended) or any enabling legislation or executive order relating
thereto.  

    
      
        
           

        

         

      

      
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    (b)Neither
the Company nor any Subsidiary (i) is, or will become, a Person described or
designated in the Specially Designated Nationals and Blocked Persons List of the
Office of Foreign Assets Control or in section 1 of the Anti-Terrorism
Order or (ii) knowingly engages or will engage in any dealings or
transactions, or knowingly is or will be otherwise associated, with any such
Person.  The Company and its Subsidiaries are, to their knowledge, in
compliance, in all material respects, with the USA Patriot
Act.  Neither the Company nor any Subsidiary (i) is or will become a
blocked person described in section 1 of Executive Order 13224 of
September 23, 2001 Blocking Property and Prohibiting Transactions With
Persons Who Commit, Threaten to Commit, or Support Terrorism (66 Fed. Reg. 49079
(2001)) or (ii) knowingly engages or will engage in any dealings or
transactions, or be otherwise associated, with any such blocked
person.

     

    (c) No
part of the proceeds from the sale of the Notes hereunder will be used, directly
or indirectly, for any payments to any governmental official or employee,
political party, official of a political party, candidate for political office,
or anyone else acting in an official capacity, in order to obtain, retain or
direct business or obtain any improper advantage, in violation of the Foreign
Corrupt Practices Act of 1977, as amended.

     

    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, or the ICC
Termination Act of 1995, as amended, nor is the Company subject to regulation
under the Federal Power Act, as amended, with respect to the execution, delivery
or performance of this Agreement or the Notes or the issuance of other
securities.

     

    Section 5.18.Environmental
Matters.  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 raising any claim against the Company or any of its Subsidiaries or
any of their respective real properties now or formerly owned, leased or
operated by any of them or other assets, 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.  Without limiting the foregoing,

     

    (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 reasonably be
expected to result in a Material Adverse Effect;

     

    (b)neither
the Company nor any of its Subsidiaries has stored any Hazardous Materials on
real properties now or formerly owned, leased or operated by any of them and has
not disposed of any Hazardous Materials in a manner contrary to any
Environmental Laws in each case in any manner that could reasonably be expected
to result in a Material Adverse Effect; and

     

    (c)all
buildings on all real properties now owned, leased or operated by the Company or
any of its Subsidiaries are in compliance with applicable Environmental Laws,
except where failure to comply could not reasonably be expected to result in a
Material Adverse Effect.

    
      
        
           

        

         

      

      
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              Section 6.Representations
      of the Purchaser.

            

    

     

    Each of
you severally represents and warrants to the Company as follows:

     

    Section 6.1.Purchase of
Notes.

     

    You
represent that you are purchasing the Notes for your own account or for one or
more separate accounts maintained by you 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 your or their property shall at all times be within your or their
control.  You understand 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.  You represent that at least one of the following
statements is an accurate representation as to each source of funds (a “Source”) to be used by you
to pay the purchase price of the Notes to be purchased by you
hereunder:

     

    (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 National Association of Insurance
Commissioners (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 ten percent (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 have been 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

    
      
        
           

        

         

      

      
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    (d)the
Source constitutes assets of an “investment fund” (within the meaning of
Part V of the QPAM Exemption) managed by a “qualified professional asset
manager” or “QPAM” (within the meaning of Part V of the QPAM Exemption), no
employee benefit plan’s assets that are included 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
section V(c)(1) of the QPAM Exemption) of such employer or by the same
employee organization and managed by such QPAM, exceed 20% of the total client
assets managed by such QPAM, the conditions of Part I(c) and (g) of the QPAM
Exemption are satisfied, as of the last day of its most recent calendar quarter,
the QPAM does not own a 10% or more interest in the Company and no Person
controlling or controlled by the QPAM (applying the definition of “control” in
section V(e) of the QPAM Exemption) owns a 20% or more interest in the
Company (or less than 20% but greater than 10%, if such Person exercises control
over the management or policies of the Company by reason of its ownership
interest) and (i) the identity of such QPAM and (ii) the names of all
employee benefit plans whose assets are included in such investment fund have
been disclosed to the Company in writing pursuant to this clause (d);
or

     

    (e)the
Source constitutes assets of a “plan(s)” (within the meaning of section IV
of PTE 96-23 (the “INHAM
Exemption”)) managed by an “in-house asset manager” or “INHAM” (within
the meaning of Part IV 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 section IV(d) of the INHAM Exemption) owns a 5% 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 paragraph (f);
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 6.3.Accredited
Investor.  You are an “accredited investor” as such term is
defined in Regulation D promulgated pursuant to the Securities
Act.

    
      
        
           

        

         

      

      
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              Section 7.Information
      as to Company.

            

    

     

    Section 7.1.Financial and Business
Information.  The Company
shall deliver to each holder of Notes that is an Institutional
Investor:

     

    (a)Quarterly Statements --
within 60 days 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), 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,

     

    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 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
Quarterly Report on Form 10-Q prepared in compliance with the requirements
therefor and filed with the Securities and Exchange Commission shall be deemed
to satisfy the requirements of this Section 7.1(a);

     

    (b)Annual Statements -- within
105 days after the end of each fiscal year of the Company, copies
of,

     

    (i)a
consolidated balance sheet of the Company and its Subsidiaries as at the end of
such year, and

     

    (ii)consolidated
statements of income, changes in shareholders’ equity and cash flows of the
Company 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 of independent public accountants of recognized national
standing, which opinion shall state that such financial statements 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 Company’s Annual Report
on

     

    
      
        
           

        

         

      

      
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    Form 10-K
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 Securities and
Exchange Commission shall be deemed to satisfy the requirements of this
Section 7.1(b);

     

    (c)SEC and Other Reports --
promptly upon their becoming available, one copy of (i) each financial
statement, report, notice or proxy statement sent by UIL Holdings, the Company
or any Subsidiary to public securities holders generally or its lending banks,
(ii) each regular or periodic report, each registration statement (without
exhibits except as expressly requested by such holder), and each prospectus and
all amendments thereto filed by UIL Holdings, the Company or any Subsidiary with
the Securities and Exchange Commission and (iii) all press releases and
other statements made available generally by UIL Holdings, the Company or any
Subsidiary to the public concerning developments that are Material;

     

    (d)Notice of Default or Event of
Default -- promptly, and in any event within five 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;

     

    (e)ERISA Matters -- promptly,
and in any event within five 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:

     

    (i)with
respect to any Plan, any reportable event, as defined in section 4043(b) 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;

     

    (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,

    
      
        
           

        

         

      

      
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    taken
together with any other such liabilities or Liens then existing, could
reasonably be expected to have a Material Adverse Effect;

     

    (f)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 United
States 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; and

     

    (g)Requested Information -- with
reasonable promptness, such other data and information relating to the business,
operations, affairs, financial condition, assets or properties of the Company or
any of its Subsidiaries or relating to the ability of the Company to perform its
obligations hereunder and under the Notes as from time to time may be reasonably
requested by any such holder of Notes.

     

    Section 7.2.Officer’s Certificate.  Each set of financial statements delivered
to a holder of Notes pursuant to Section 7.1(a) or Section 7.1(b)
shall be accompanied by a certificate of a Senior Financial Officer setting
forth:

     

    (a)Covenant Compliance -- the
information (including detailed calculations) required in order to establish
whether the Company was in compliance with the requirements of Sections 10.1
through 10.6, inclusive, during the quarterly or annual period covered by the
statements then being furnished (including with respect to each such Section,
where applicable, the calculations of the maximum or minimum amount, ratio or
percentage, as the case may be, permissible under the terms of such Sections,
and the calculation of the amount, ratio or percentage then in existence);
and

     

    (b)Default -- a statement 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.Inspection.  The Company shall permit the representatives of each
holder of Notes that is an Institutional Investor:

     

    (a)No Default -- if no Default
or Event of Default then exists, at the expense of 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

    
      
        
           

        

         

      

      
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    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, to visit and
inspect any of the offices or properties 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, employees 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 8.Prepayment
      of the Notes.

            

    

     

    In
addition to the payment of the entire unpaid principal amount of the Notes at
the final maturity thereof, the Company may make optional prepayments in respect
of the Notes as hereinafter provided.

     

    Section 8.1.Optional Prepayments with Make-Whole
Amount.  The Company may, at its option and upon notice as
provided in Section 8.2, prepay at any time all, or from time to time any
part of, the Notes of each series in proportion to the aggregate principal
amount outstanding of each series of the Notes (in a minimum amount of
$5,000,000 and otherwise in multiples of $100,000) at the principal amount so
prepaid, together with interest accrued thereon to the date of such prepayment,
plus the Make-Whole Amount determined for the prepayment date with respect to
the respective principal amounts.  

     

    Section 8.2.Notice of
Prepayment.  The Company will give each holder of Notes written
notice of each optional prepayment under Section 8.1 not less than 30 days
and not more than 60 days prior to the date fixed for such
prepayment.  Each such notice shall specify the date fixed for such
prepayment (which shall be a Business Day), the aggregate principal amount of
each series of the Notes to be prepaid on such date, the principal amount of
Notes 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.

     

    Each such
notice of prepayment 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 Notes of each series a certificate of a Senior Financial Officer specifying
the calculation of such Make-Whole Amount as of the specified prepayment
date.

    
      
        
           

        

         

      

      
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    Section 8.3.Allocation of Partial
Prepayments.  In the case of each partial prepayment of the
Notes pursuant to Section 8.1, the principal amount of the Notes to be
prepaid shall be (a) allocated among each series of Notes in proportion to
the aggregate unpaid principal amount of each such series of Notes and
(b) allocated pro rata among all of the Notes of each series at the time
outstanding in proportion, as nearly as practicable, to the respective unpaid
principal amounts thereof.

     

    Section 8.4.Maturity; Surrender,
Etc.  In the case of each prepayment of Notes 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 each series in accordance with the terms of this Agreement and the
Notes.  The Company will promptly cancel all Notes acquired by it or
any Affiliate pursuant to any payment or prepayment of Notes pursuant to any
provision of this Agreement and no Notes may be issued in substitution or
exchange for any such Notes.

     

    Section 8.6.Make-Whole
Amount.  The term “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 8.1 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, .50% (50 basis points) over
the yield to maturity implied by (i) the yields reported as of 10:00 a.m. (New
York City time) on the second Business Day preceding the Settlement

    
      
        
           

        

         

      

      
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    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
having a maturity equal to the remaining life of such Called Principal as of
such Settlement Date, or (ii) if such yields are not reported as of such
time or the yields reported as of such time are not ascertainable (including by
way of interpolation), the Treasury Constant Maturity Series 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 (519) (or any comparable
successor publication) for actively traded U.S. Treasury securities having a
constant maturity equal to the remaining life of such Called Principal as of
such Settlement Date.  Such implied yield will be determined, if
necessary, by (a) converting U.S. Treasury bill quotations to
bond-equivalent yields in accordance with accepted financial practice and
(b) interpolating linearly between (1) the actively traded U.S. Treasury
security with a maturity closest to and greater than the remaining life and (2)
the actively traded U.S. Treasury security with a maturity closest to and less
than the remaining life.  The Reinvestment Yield will be rounded to
two decimal places.

     

    “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 terms of 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 8.1 or 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 8.1 or has become or is
declared to be immediately due and payable pursuant to Section 12.1, as the
context requires.

     

    
      	
               
      

            	
              Section 9.Affirmative
      Covenants.

            

    

     

    The
Company covenants that so long as any of the Notes are outstanding:

     

    Section 9.1.Compliance with
Law.  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 the USA Patriot Act
and Environmental
Laws, 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.

    
      
        
           

        

         

      

      
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    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 (whether filed directly by the Company or
its Subsidiaries or as part of the consolidated tax return of UIL Holdings)
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 such taxes and assessments 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 or assessment or claims 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 and assessments in the aggregate
could not reasonably be expected to have a Material Adverse Effect.

     

    Section 9.5.Corporate Existence,
Etc.  The Company will at all times preserve and keep in full
force and effect its corporate existence.  Subject to
Section 10.6, 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 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 effect such
corporate existence, right or franchise could not, individually or in the
aggregate, reasonably be expected to have a Material Adverse
Effect.

     

    
      	
               
      

            	
              Section 10.Negative
      Covenants.

            

    

     

    The
Company covenants that so long as any of the Notes are outstanding:

     

    Section 10.1.Maintenance of Consolidated
Indebtedness.   The Company will not at any time permit
Consolidated Indebtedness to be greater than 65% of Consolidated Capitalization.

    
      
        
           

        

         

      

      
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    Section 10.2.Subsidiary
Indebtedness.  The Company will not permit any Subsidiary to
create, assume, incur, guarantee or otherwise become liable in respect of any
Indebtedness other than:

     

    (a)Indebtedness
outstanding on the date hereof as specified on Schedule 5.15 and any extension,
renewal, refunding or refinancing of any such Indebtedness, provided that the principal
amount thereof outstanding immediately before giving effect to such extension,
renewal, refunding or refinancing is not increased;

     

    (b)Indebtedness
of any Person existing at the time such Person becomes a Subsidiary (and not
incurred in anticipation thereof) and any extension, renewal, refunding or
refinancing of any such Indebtedness, provided that the principal
amount thereof outstanding immediately before giving effect to such extension,
renewal, refunding or refinancing is not increased and neither the Company nor
any other Subsidiary shall assume or otherwise be directly or indirectly liable
for such Indebtedness;

     

    (c)Indebtedness
owing to the Company or a Wholly-Owned Subsidiary; and

     

    (d)Indebtedness
not otherwise permitted by clauses (a) through (c) above, provided that Priority Debt
(as defined below) does not exceed 10% of Consolidated
Capitalization.

     

    For
purposes of this Section 10.2, a Subsidiary shall be deemed to have
incurred Indebtedness previously owed to the Company or another Subsidiary at
the time the obligee ceases for any reason to be the Company or a Wholly-Owned
Subsidiary.

     

    Section 10.3.Liens.  The Company
will not and will not permit any Subsidiary to create, assume, incur or suffer
to exist any Lien upon or with respect to any property or assets, whether now
owned or hereafter acquired, without making effective provision (pursuant to
documentation in form and substance reasonably satisfactory to the Required
Holders) whereby the Notes shall be secured by such Lien equally and ratably
with or prior to any and all Indebtedness and other obligations to be secured
thereby, provided that
nothing in this Section 10.3 shall prohibit:

     

    (a)Liens
in respect of property of the Company or a Subsidiary existing on the Execution
Date and described in Schedule 5.15;

     

    (b)Liens
in respect of property acquired or constructed by the Company or a Subsidiary
after the Execution Date, which are created at the time of or within 120 days
after acquisition or completion of construction of such property to secure
Indebtedness assumed or incurred to finance all or any part of the purchase
price or cost of construction of such property, provided that in any such
case

     

    (i)no
such Lien shall extend to or cover any other property of the Company or such
Subsidiary, as the case may be, and

    
      
        
           

        

         

      

      
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    (ii)the
aggregate principal amount of Indebtedness secured by all such Liens in respect
of any such property shall not exceed the cost of such property and any
improvements then being financed;

     

    (c)Liens
in respect of property acquired by the Company or a Subsidiary after the
Execution Date, existing on such property at the time of acquisition thereof
(and not created in anticipation thereof), or in the case of any Person that
after the Execution Date becomes a Subsidiary or is consolidated with or merged
with or into the Company or a Subsidiary or sells, leases or otherwise disposes
of all or substantially all of its property to the Company or a Subsidiary,
Liens existing at the time such Person becomes a Subsidiary or is so
consolidated or merged or effects such sale, lease or other disposition of
property (and not created in anticipation thereof), provided that in any such
case no such Lien shall extend to or cover any other property of the Company or
such Subsidiary, as the case may be;

     

    (d)Liens
securing Indebtedness owed by a Subsidiary to the Company or to a
Subsidiary;

     

    (e)extensions,
renewals or replacements of any Liens permitted by clause (a), (b) or (c)
above (including successive extensions, renewals and replacements), provided in each case that
the principal amount of Indebtedness (or the maximum commitment therefor)
secured by any such Lien is not increased and such Lien does not extend to or
cover any property other than the property covered by such Lien on the date of
such extension, renewal or replacement;

     

    (f)Liens
(i) for taxes or assessments or other governmental charges or levies, either not
yet delinquent, or which are being contested in good faith by appropriate
proceedings provided
that the Company has established adequate reserves therefor in accordance with
GAAP, (ii) created by or resulting from litigation or legal proceedings which
are currently being contested in good faith by appropriate proceedings and do
not involve amounts that in the aggregate would exceed $10,000,000 and (iii)
incidental to the normal conduct of the business of the Company or any
Subsidiary or the ownership of its property which are not incurred in connection
with the incurrence of Indebtedness and which do not in the aggregate materially
impair the use of such property in the operation of the business of the Company
and its Subsidiaries taken as a whole or the value of such property for the
purposes of such business; or

     

    (g)Liens
which would otherwise not be permitted by clauses (a) through (e) above,
securing additional Indebtedness of the Company or a Subsidiary, provided that Priority Debt
does not exceed 10% of Consolidated Capitalization.

     

    As used
in this Agreement the term “Priority Debt” means, at any
date, the sum (without duplication) of (A) the aggregate unpaid principal amount
of Indebtedness (including Capitalized Lease Obligations) of the Company and its
Subsidiaries secured by Liens (other than Liens permitted by clauses (a) through
(f) of this Section 10.3) plus (B) the aggregate Attributable Debt in
connection with all Sale and Leaseback Transactions of the Company and its
Subsidiaries 

    
      
        
           

        

         

      

      
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    entered
into after the date of the Execution Date, in accordance with the provisions of
Section 10.4(c) plus (C) the aggregate unpaid principal amount of
Indebtedness of all Subsidiaries (other than Indebtedness permitted by
Section 10.2(b) and (c)).

     

    Section 10.4.Limitation on Sale and
Leaseback.  The Company will not and will not permit any
Subsidiary to enter into any arrangement, directly or indirectly, with any
Person whereby the Company or such Subsidiary shall sell, lease or transfer any
asset, whether now owned or hereafter acquired, and then or thereafter rent or
lease as lessee such asset or any part thereof or any other asset that the
Company or such Subsidiary, as the case may be, intends to use for substantially
the same purposes as the asset being sold, leased or transferred (any such sale,
lease or transfer and rent or lease, a “Sale and Leaseback
Transaction”), unless:

     

    (a)such
Sale and Leaseback Transaction involves an asset upon which a Lien would at the
time be permitted by Section 10.3(b) without equally and ratably securing
the Notes or such Sale and Leaseback Transaction is between the Company and a
Subsidiary as lessee and involves an asset subject to a Lien permitted by
Section 10.3(d);

     

    (b)such
lease is for a period not exceeding one year, at the expiration of which it is
intended that the use of such asset by the lessee will be discontinued;
or

     

    (c)Priority
Debt (which includes the Attributable Debt resulting from such Sale and
Leaseback Transaction) does not exceed 10% of Consolidated
Capitalization.

     

    Section 10.5.Disposition of
Assets.  The Company will not and will not permit any
Subsidiary to, directly or indirectly, sell, lease, transfer or otherwise
dispose of (collectively a “Disposition”) any of its
assets, whether now owned or hereafter acquired, unless after giving effect to
any proposed Disposition, the aggregate net book value of all assets of the
Company and its Subsidiaries that were the subject of a Disposition during the
period (x) commencing on January 1, 2008 and ending on the date of such
proposed Disposition does not exceed 10% of Consolidated Total Assets and
(y) commencing on the first day of the then current fiscal year of the
Company and ending on the date of such proposed Disposition does not exceed 5%
of Consolidated Total Assets (Consolidated Total Assets in each case to be
determined as at the end of the immediately preceding fiscal year), provided that the following
Dispositions shall not be taken into account for purposes of this
Section 10.5:  

     

    (a)any
Disposition in the ordinary course of business;

     

    (b)the
Disposition of the Company’s Electric Systems Work Center Facility located in
Shelton, Connecticut;

     

    (c)Sale
and Leaseback Transactions permitted by Section 10.4; and

     

    (d)any
other Disposition for fair value to the extent that the Net Proceeds Amount of
such Disposition is applied within 360 days after the date thereof to the
acquisition of other assets for use in the business of the Company or any
Subsidiary (such assets not to include cash or marketable securities) or to
reduce outstanding

    
      
        
           

        

         

      

      
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    unsubordinated
Indebtedness of the Company or any Subsidiary (any such reduction to include
either (i) prepayment of Notes pursuant to Section 8.1 in an aggregate
unpaid principal amount that bears the same relation to the amount then being
applied to reduce such Indebtedness as the aggregate unpaid principal amount of
the Notes bears to the aggregate unpaid principal amount of outstanding
unsubordinated Indebtedness of the Company and its Subsidiaries, or (ii) an
offer by the Company to all holders of Notes to purchase, at not less than par
on the same terms and conditions and which offer shall remain outstanding for at
least 30 days, Notes in an aggregate unpaid principal amount at least equal to
such pro rata portion of such unsubordinated Indebtedness being so reduced,
allocated pro rata among all Notes tendered, and the requirements of this
subclause (d) with respect to prepayment of Notes shall be deemed to be
satisfied with respect to such Disposition if such offer is made and, if
accepted, consummated).

     

    For
purposes of this Section 10.5 any shares of Voting Stock of a Subsidiary
that are the subject of a Disposition (including without limitation pursuant to
an issuance of shares by such Subsidiary) shall be valued at the aggregate net
book value of the assets of such Subsidiary multiplied by a fraction of which
the numerator is the aggregate number of shares of Voting Stock of such
Subsidiary issued or disposed of in such Disposition and the denominator is the
aggregate number of shares of Voting Stock of such Subsidiary outstanding
immediately prior to such Disposition.

     

    Section 10.6.Merger, Consolidation,
Etc.  The Company will not consolidate with or merge with any
other corporation 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 substantially all of the
assets of the Company as an entirety, as the case may be, shall be a solvent
corporation 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 successor corporation, (i) such corporation 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 in form and substance reasonably satisfactory to the Required Holders
and (ii) 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; and

     

    (b)immediately
after giving effect to such transaction, no Default or Event of Default shall
have occurred and be continuing.

     

    No such
conveyance, transfer or lease of all or substantially all of the assets of the
Company shall have the effect of releasing the Company or any successor
corporation that shall theretofore have become such in the manner prescribed in
this Section 10.6 from its liability under this Agreement or the
Notes.

    
      
        
           

        

         

      

      
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    Section 10.7.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.

     

    Section 10.8.Terrorism Sanctions
Regulations.  The Company will not and will not permit any
Subsidiary to (a) become a Person described or designated in the Specially
Designated Nationals and Blocked Persons List of the Office of Foreign Assets
Control or in Section 1 of the Anti-Terrorism Order or (b) knowingly
engage in any dealings or transactions with any such Person.

     

    
      	
               
      

            	
              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
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(d) (provided that if the Default, Event of Default or claimed
default giving rise to the requirement for a notice in respect thereof, the
non-delivery of which has caused the occurrence of an Event of Default
hereunder, has been cured or otherwise remedied, such that it is not a Default
or Event of Default under Section 11(d), then no Event of Default hereunder
by virtue of such breach of Section 7.1(d) shall constitute an Event of
Default hereunder) or Sections 10.1 to 10.6, inclusive; or

     

    (d)the
Company defaults in the performance of or compliance with any term
contained herein (other than those referred to in paragraphs (a), (b) and
(c) of this Section 11) and such default is not remedied within 30 days
after a Responsible Officer obtains knowledge of such default; or

     

    (e)any
representation or warranty made in writing by or on behalf of the Company or any
officer of the Company in this Agreement or in 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

    
      
        
           

        

         

      

      
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    (f)(i)
the Company or any Significant 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 (other than the Notes) that is
outstanding in an aggregate principal amount of at least $10,000,000 beyond any
period of grace provided with respect thereto, or (ii) the Company or any
Significant Subsidiary is in default in the performance of or compliance with
any term of any evidence of any Indebtedness outstanding in an aggregate
principal amount of at least $10,000,000 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 (iii) 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 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 $10,000,000, or (y) one
or more Persons have the right to require the Company or any Subsidiary so to
purchase or repay such Indebtedness; or

     

    (g)the
Company or any Significant 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, (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 or any Significant Subsidiary, 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 or any such Significant Subsidiary, or
any such petition shall be filed against the Company or any such Significant
Subsidiary and such petition shall not be dismissed within 60 days;
or

     

    (i)a
final judgment or judgments for the payment of money aggregating in excess of
$10,000,000 are rendered against one or more of the Company and its Significant
Subsidiaries which judgments are not, within 60 days after entry thereof,
bonded, discharged or stayed pending appeal, or are not discharged within 60
days after the expiration of such stay; or

    
      
        
           

        

         

      

      
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    (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 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, (iv) the Company or any ERISA Affiliate withdraws from any
Multiemployer Plan and withdrawal liability exceeds $5,000,000, or (v) the
Company or any Subsidiary establishes or amends any employee welfare benefit
plan that provides post-employment welfare benefits in any manner that would
increase the liability of the Company or any Subsidiary thereunder by more than
$5,000,000; and any such event or events described in clauses (i) through (v)
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 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.

     

    
      	
               
      

            	
              Section 12.Remedies
      on Default, Etc.

            

    

     

    Section 12.1.Acceleration.  (a)  If
an Event of Default with respect to the Company described in paragraph (g)
or (h) of Section 11 (other than an Event of Default described in clause
(i) of paragraph (g) or described in clause (vi) of paragraph (g) by
virtue of the fact that such clause encompasses clause (i) of
paragraph (g)) has occurred, all the Notes then outstanding shall
automatically become immediately due and payable.

     

    (b)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 at the time outstanding to be immediately due and
payable.

     

    (c)If any
Event of Default described in paragraph (a) or (b) of Section 11 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
Note becoming due and payable under this Section 12.1, whether
automatically or by declaration, such Note will forthwith mature and the entire
unpaid principal amount of such Note, plus (x) all accrued and unpaid interest
thereon and (y) the Make-Whole Amount determined in respect of such principal
amount, 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 (except as herein specifically provided) and that
the provision for payment of a Make-Whole

    
      
        
           

        

         

      

      
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    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, 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 paragraph
(b) or (c) of Section 12.1, the Required Holders, 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 any overdue interest in
respect of the Notes, at the Default Rate, (b) all Events of Default and
Defaults, other than the 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 (c) 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 or by
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 of one or more
Notes shall be registered in such register.  Prior to due presentment
for registration of transfer, the Person in whose name any Note 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

     

    

    
      
        
           

        

         

      

      
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    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 13.2Transfer and Exchange of
Notes.  Upon surrender of any Note
at the principal executive office of the Company for registration of transfer or
exchange (and in the case of a surrender for registration of transfer, duly
endorsed or accompanied by a written instrument of transfer duly executed by the
registered holder of such Note or his attorney duly authorized in writing and
accompanied by the address for notices of each transferee of such Note or part
thereof), within five 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) in exchange therefor, of the same
series and 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 set out
in Exhibit 1-A,
Exhibit 1-B and
Exhibit 1C, as
applicable.  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
representations set forth in Section 6.

     

    Section 13.3.Replacement of Notes.  Upon receipt by the Company 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 any other
Institutional Investor, 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,

     

    within
five Business Days thereafter the Company at its own expense shall execute and
deliver, in lieu thereof, a new Note of the same series, 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.

            

    

     

    Section 14.1.Place of
Payment.  Subject to Section 14.2, payments of principal,
Make-Whole Amount, if any, and interest becoming due and payable on the Notes
shall be made at the principal office of Citibank, N.A. in New York
City.  The Company may at any time, by notice 

     

    

    
      
        
           

        

         

      

      
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    to each
holder of a Note, change the place of payment of the Notes so long as such place
of payment shall be the principal office of a bank or trust company in New York
City.

     

    Section 14.2.Home Office
Payment.  So long as you or your nominee shall be the holder of
any Note, and notwithstanding anything contained in Section 14.1 or in such
Note to the contrary, the Company will pay all sums becoming due on such Note
for principal, Make-Whole Amount, if any, and interest by the method and at the
address specified for such purpose below your name in Schedule A, or by such
other method or at such other address as you 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, you shall surrender
such Note for cancellation, reasonably promptly after any such request, to the
Company at its principal executive office or at the place of payment most
recently designated by the Company pursuant to
Section 14.1.  Prior to any sale or other disposition of any Note
held by you or your nominee you will, at your 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 of the same series pursuant to Section 13.2.  The
Company will afford the benefits of this Section 14.2 to any Institutional
Investor that is the direct or indirect transferee of any Note purchased by you
under this Agreement and that has made the same agreement relating to such Note
as you have made in this Section 14.2.

     

    
      	
               
      

            	
              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 your special counsel and, if reasonably required,
local or other counsel) incurred by you and each other Purchaser or 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 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 or the Notes or in responding to any subpoena or other legal
process or informal investigative demand issued in connection with this
Agreement or the Notes, or by reason of being a holder of any Note; (b) the
costs and expenses incurred in connection with the initial filing of this
Agreement and all related documents and financial information and all subsequent
annual and interim filings of documents and financial information related to
this Agreement, with the Securities Valuation Office of the National Association
of Insurance Commissioners or any successor organization succeeding to the
authority thereof; and (c) 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 Company
will pay, and will save you and each other holder of a Note harmless from, all
claims in respect of any fees, costs or expenses if any, of brokers and finders
(other than those retained by you).

    
      
        
           

        

         

      

      
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    In
furtherance of the foregoing, on the date of each Closing the Company will pay
or cause to be paid the fees and disbursements and other charges (including
estimated unposted disbursements and other charges as of the date of each
Closing) of your special counsel which are reflected in the statement of such
special counsel submitted to the Company at least one Business Day prior to the
date of each Closing.  The Company will also pay, promptly upon
receipt of supplemental statements therefor, reasonable additional fees, if any,
and disbursements and charges of such special counsel in connection with the
transactions hereby contemplated (including disbursements and other charges
unposted as of the date of either Closing to the extent such disbursements and
other charges exceed estimated amounts paid as aforesaid).

     

    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 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 you 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 you 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 and the
Notes embody the entire agreement and understanding between you 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), with (and
only with) the written consent of the Company and the Required Holders, except
that (a) no amendment or waiver of any of the provisions of Section 1, 2,
3, 4, 5, 6 or 21, or any defined term (as it is used therein), will be effective
as to you unless consented to by you in writing, and (b) no such amendment or
waiver may, without the written consent of the holder of each Note at the time
outstanding, (i) subject to the provisions of 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 interest or of the Make-Whole Amount on, the Notes,
(ii) change the percentage of the principal amount of the Notes the holders
of which are required to consent to any such amendment or waiver, or
(iii) amend any of Sections 8, 11(a), 11(b), 12, 17 or
20.

     

    Section 17.2.Solicitation of Holders of
Notes.

     

    (a)Solicitation.  The
Company will provide each holder of the Notes (irrespective of the amount or
series of Notes then owned by it) with sufficient information, sufficiently far
in 

    
      
        
           

        

         

      

      
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    advance
of the date a decision is required, to enable 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 Company will deliver executed or true and correct copies
of each amendment, waiver or consent effected pursuant to the provisions of this
Section 17 to each holder of outstanding Notes promptly following the date
on which it is executed and delivered by, or receives the consent or approval
of, the requisite 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, to any holder of any series of Notes as
consideration for or as an inducement to such holder’s consideration of or
entering into of any waiver or amendment of any of the terms and provisions
hereof unless such remuneration is concurrently paid, or security is
concurrently granted, on the same terms, ratably to each holder of each series
of Notes then outstanding even if such holder did not consent to such waiver or
amendment.

     

    Section 17.3.Binding Effect,
Etc.  Any amendment or waiver consented to as provided in this
Section 17 applies equally to all holders of each series of Notes and is
binding upon them and upon each future holder of any Note of any series 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 the holder of
any Note of any series nor any delay in exercising any rights hereunder or under
any Note of any series shall operate as a waiver of any rights of any holder of
such Note.  As used herein, the term “this Agreement” and
references thereto shall mean this Agreement as it may from time to time be
amended or supplemented.

     

    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 or the Notes, or have directed the taking of any
action provided herein or in 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.

            

    

     

    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 a recognized overnight delivery service (charges prepaid), or
(b) by United States mail, postage prepaid, or (c) by a recognized
United States based overnight delivery service (with charges
prepaid).  Any such notice must be sent:

     

    (a)if to
you or your nominee, to you or it at the address specified for such
communications in Schedule A, or at such other address as you or it shall have
specified to the Company in writing,

    
      
        
           

        

         

      

      
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    (b)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, or

     

    (c) if to
the Company, to the Company at its address set forth at the beginning hereof to
the attention of the Treasurer, or at such other address as the Company shall
have specified to the holder of each Note in writing.

     

    Notices
under this Section 18 will be deemed given only when actually
received.  The information required to be sent to holders of notes
pursuant to Sections 7.1(a), (b) or (c) or Section 7.2 may be sent by any of the
methods listed above or by electronic mail at such address as such holder shall
have specified to the Company in writing.

     

    
      	
               
      

            	
              Section 19.Reproduction
      of Documents.

            

    

     

    This
Agreement and all documents relating thereto, except the Notes themselves, but
including, without limitation, (a) consents, waivers and modifications that
may hereafter be executed, (b) documents received by you at either Closing,
and (c) financial statements, certificates and other information previously
or hereafter furnished to you, may be reproduced by you by any photographic,
photostatic, electronic, digital, microfilm, microcard, miniature photographic
or other similar process and you 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 you 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 you by or on behalf of the Company, any
Subsidiary or UIL Holdings 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 you as being confidential information of the Company, such Subsidiary or UIL
Holdings, provided that
such term does not include information that (a) was publicly known or
otherwise known to you prior to the time of such disclosure,
(b) subsequently becomes publicly known through no act or omission by you
or any Person acting on your behalf, (c) otherwise becomes known to you
other than through disclosure by the Company, any Subsidiary or UIL Holdings,
(d) constitutes financial statements delivered to you under Section 7.1 that are
otherwise publicly available or (e) involves the tax treatment and tax structure
of the transactions as defined in United States Treasury Regulation section
1.6011-4(c) and all materials of any kind (including opinions or other tax
analyses) that are provided relating to such tax treatment and tax
structure.  You will maintain the confidentiality of such Confidential
Information in accordance with procedures adopted by you in good faith to
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    delivered
to you, provided that
you may deliver or disclose Confidential Information to (i) your directors,
officers, trustees, employees, agents, attorneys and Affiliates (to the extent
such disclosure reasonably relates to the administration of the investment
represented by your Notes), (ii) your financial advisors and other professional
advisors who agree, or whose duties require them, to hold confidential the
Confidential Information substantially in accordance with the terms of this
Section 20, (iii) any other holder of any Note, (iv) any Institutional
Investor to which you sell or offer 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 the provisions of this
Section 20), (v) any Person from which you offer 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 the provisions of this
Section 20), (vi) any federal or state regulatory authority having
jurisdiction over you, (vii) the National Association of Insurance
Commissioners or any similar organization, or any nationally recognized rating
agency that requires access to information about your 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 you, (x) in response to any subpoena or
other legal process, (y) in connection with any litigation to which you are
a party or (z) if an Event of Default has occurred and is continuing, to
the extent you 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 your Notes and this Agreement.  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 the provisions of
this Section 20.

     

    
      	
               
      

            	
              Section 21.Substitution
      of Purchaser.

            

    

     

    You shall
have the right to substitute any one of your Affiliates as the purchaser of the
Notes that you have agreed to purchase hereunder, by written notice to the
Company, which notice shall be signed by both you and such Affiliate, shall
contain such Affiliate’s agreement to be bound by this Agreement and shall
contain a confirmation by such Affiliate of the accuracy with respect to it of
the representations set forth in Section 6.  Upon receipt of such
notice, wherever the word “you” is used in this Agreement (other than in this
Section 21), such word shall be deemed to refer to such Affiliate in lieu
of you.  In the event that such Affiliate is so substituted as a
purchaser hereunder and such Affiliate thereafter transfers to you all of the
Notes then held by such Affiliate, upon receipt by the Company of notice of such
transfer, wherever the word “you” is used in this Agreement (other than in this
Section 21), such word shall no longer be deemed to refer to such
Affiliate, but shall refer to you, and you shall 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 

    
      
        
           

        

         

      

      
        - 33
-

        
          

        

      

      
         

      

    

     

    respective
successors and assigns (including without limitation any subsequent holder of a
Note) whether so expressed or not.

     

    Section 22.2.Construction.  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.

     

    For the
avoidance of doubt, all Schedules and Exhibits attached to this Agreement shall
be deemed to be a part hereof.

     

    Section 22.3.Consent to Jurisdiction; Service of
Process; Waiver of Jury Trial.  (a)  The Company
irrevocably submits to the non-exclusive in personam jurisdiction of
any New York State or federal court sitting in the Borough of Manhattan,
The City of New York, over any suit, action or proceeding arising out of or
relating to this Agreement or the Notes.  To the fullest extent it may
effectively do so under 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 in personam 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.

     

    (b)The
Company consents to process being served in any suit, action or proceeding of
the nature referred to in paragraph (a) of this Section 22.3 by mailing a
copy thereof by registered or certified mail, postage prepaid, return receipt
requested, to the address of the Company specified in Section 18 or at such
other address of which you 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 full extent
permitted by law, be taken and held to be valid personal service upon and
personal delivery to the Company.  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.

     

    (c)Nothing
in this Section 22.3 shall affect the right of any holder of Notes 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.

     

    (d)Each
of the parties hereto waives 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.

    
      
        
           

        

         

      

      
        - 34
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    Section 22.4.Payments Due on Non-Business
Days.  Anything in this Agreement or the Notes to the contrary
notwithstanding (but without limiting the requirement in Section 8.2 that notice
of any optional prepayment specify a Business Day as the date fixed for such
prepayment), any payment of principal of or Make-Whole Amount or interest on any
Note that is due on a date other than 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; provided that if the maturity
date of any Note is a date other than a Business Day, the payment otherwise due
on such maturity date 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 22.5.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 fullest extent permitted by applicable law) not
invalidate or render unenforceable such provision in any other
jurisdiction.

     

    Section 22.6.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, all computations made pursuant to this Agreement shall be made in
accordance with GAAP and all balance sheets and other financial statements with
respect thereto shall be prepared in accordance with GAAP.

     

    Each of
the holders of the Notes by its acceptance thereof understands and agrees with
the Company that in the event that a change in GAAP is the sole cause of the
Company violating any of the covenants contained in Sections 10.1 through
10.5 hereof, or causes a Default or Event of Default to occur, at a time when no
other Default or Event of Default exists, then and in such event, anything
contained in this Agreement to the contrary notwithstanding, no Default or Event
of Default will be caused by such change in GAAP for a period of 90 days
following the event which would otherwise be treated as a Default or Event of
Default and the Company shall have 90 days from and after the date of the
occurrence of such event within which to enter into an amendment with the
Required Holders and the holders and the Company shall undertake in good faith
to amend any affected provisions of this Agreement so as to preserve the intent
and purpose thereof and to accommodate such change in GAAP and to enter into an
amendment hereof to reflect the same, such amendment to be in form and substance
satisfactory to the Company and the Required Holders.

     

    Section 22.7.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 22.8.Governing
Law.  This Agreement and the Notes shall be construed and
enforced in accordance with, and the rights of the parties shall be governed by,
the law of the State of New York excluding choice-of-law principles of the law
of such State that would require the application of the laws of a jurisdiction
other than such State.

    *    *    *    *    *

     

    
      
        
           

        

         

      

      
        - 35
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    If you
are in agreement with the foregoing, please sign the form of agreement in the
space below provided on a counterpart of this Agreement and return it to the
Company, whereupon the foregoing shall become a binding agreement between you
and the Company.

     

    Very
truly yours,

     

    

     

    
      	 
      	
              The
      United Illuminating Company

            

    

    

    

    

    
      	 
      	
              By                /s/ Susan E. Allen                                                             

            
	 
      	
              Name: Susan E.
      Allen

            
	 
      	
              Title: Vice President Investor
      Relations

            
	 
      	
              and
  Treasurer

            

    

    
      
        
           

        

         

      

      
        - 36
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    The
foregoing is hereby agreed to as of the date thereof.

     

    

     

    
      	 
      	
              Allianz
      Life Insurance Company of
NorthAmerica

            

    

    

    

    
      	 
      	
              By:      Allianz
      of America, Inc., as the authorizedsignatory and investment
      manager

            

    

    

    

    

    
      	 
      	
              By                /s/ Gary Brown            

            
	 
      	
              Name: Gary
  Brown

            
	 
      	
              Title: Assistant
      Treasurer

            

    

    
      
        
           

        

         

      

      
        - 37
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    The
foregoing is hereby agreed to as of the date thereof.

    

     

    
      	 
      	
              C.M.
      Life Insurance Company

            

    

    

    
      	 
      	
              By:    Babson
      Capital Management LLC as

              Investment
      Sub-Adviser

            

    

    

    

    

    
      	 
      	
              By                /s/ John B.
      Wheeler        

            
	 
      	
              Name: John B.
      Wheeler

            
	 
      	
              Title: Managing
      Director

            

    

    

    

    

    

     

    
      	 
      	
              Massachusetts
      Mutual Life Insurance Company

            

    

    

    

    
      	 
      	
              By:     Babson
      Capital Management LLC as 

                        
      Investment Adviser

            

    

    

    

    

    
      	 
      	
              By                /s/ John B.
      Wheeler        

            
	 
      	
              Name: John B.
      Wheeler

            
	 
      	
              Title: Managing
      Director

            

    

    

    
      
        
           

        

         

      

      
        - 38
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    The
foregoing is hereby agreed to as of the date thereof.

    

    

     

    
      	 
      	
              Bankers
      Life and Casualty Company Conseco Life Insurance
  Company

            

    

    

    

    
      	 
      	
              By:     40/86
      Advisors, Inc. acting as
InvestmentAdvisor

            

    

    

    

    

    
      	 
      	
              By                /s/ Jesse E.
      Horsfall    

            
	 
      	
              Name: Jesse E.
      Horsfall

            
	 
      	
              Title: Senior Vice
      President

            

    

    

    
      
        
           

        

         

      

      
        - 39
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    The
foregoing is hereby agreed to as of the date thereof.

    

    

    

     

    
      	 
      	
              CoBank,
      ACB

            

    

    

    

    

    
      	 
      	
              By                /s/ Brent R.
      Knight    

            
	 
      	
              Name: Brent R.
      Knight

            
	 
      	
              Title: Vice
      President

            

    

    

    
      
        
           

        

         

      

      
        - 40
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    The
foregoing is hereby agreed to as of the date thereof.

     

    

    

     

    
      	 
      	
              Connecticut
      General Life Insurance Company

            

    

    

    

    
      	 
      	
              By:   CIGNA
      Investments, Inc. (authorizedagent)

            

    

    

    

    

    
      	 
      	
              By                /s/ Robert W.
      Eccles        

            
	 
      	
              Name: Robert W.
      Eccles

            
	 
      	
              Title: Senior Managing
      Director

            

    

     

    

     

    

    

     

    
      	 
      	
              Life
      Insurance Company of North America

            

    

    

    

    
      	 
      	
              By:   CIGNA
      Investments, Inc. (authorizedagent)

            

    

    

    

    

    
      	 
      	
              By                /s/ Robert W.
      Eccles        

            
	 
      	
              Name: Robert W.
      Eccles

            
	 
      	
              Title: Senior Managing
      Director

            

    

    

    
      
        
           

        

         

      

      
        - 41
-

        
          

        

      

      
         

      

    

     

    The
foregoing is hereby agreed to as of the date thereof.

     

    

    

     

    
      	 
      	
              Hartford
      Life Insurance Company

            
	 
      	
              Hartford
      Fire Insurance Company

            
	 
      	
              Hartford
      Life and Accident Insurance Company

            
	 
      	
              Hartford
      Life and Annuity Insurance Company

            
	 
      	
              Hartford
      Accident and Indemnity Company

            

    

    

    

    
      	 
      	
              By:    
      Hartford Investment ManagementCompany

            
	 
      	
                 Their Agent and
      Attorney-in-Fact

            

    

    

    

    

    
      	 
      	
              By                /s/ Matthew J.
      Poznar    

            
	 
      	
              Name: Matthew J.
      Poznar

            
	 
      	
              Title: Senior Vice
      President

            

    

    
      
        
           

        

         

      

      
        - 42
-

        
          

        

      

      
         

      

    

    The
foregoing is hereby agreed to as of the date thereof.

    

    

     

    
      	 
      	
              Metropolitan
      Life Insurance Company

            

    

    

    

    

    
      	 
      	
              By                /s/ John A.
      Tanyeri    

            
	 
      	
              Name: John A.
      Tanyeri

            
	 
      	
              Title:
  Director

            

    

    

    

    
      
        
           

        

         

      

      
        - 43
-

        
          

        

      

      
         

      

    

     

    The
foregoing is hereby agreed to as of the date thereof.

    

     

    

     

    
      	 
      	
              Mutual
      of Omaha Insurance Company

            

    

    

    

    

    
      	 
      	
              By                /s/ Justin P.
      Kavan        

            
	 
      	
              Name: Justin P.
      Kavan

            
	 
      	
              Title: Vice
      President

            

    

    

    

    

    

     

    
      	 
      	
              United
      of Omaha Insurance Company

            

    

    

    

    

    
      	 
      	
              By                /s/ Justin P.
      Kavan        

            
	 
      	
              Name: Justin P.
      Kavan

            
	 
      	
              Title: Vice
      President

            

    

    

    
      
        
           

        

         

      

      
        - 44
-

        
          

        

      

      
         

      

    

     

    The
foregoing is hereby agreed to as of the date thereof.

     

     

     

    
      	 
      	
              Protective
      Life Insurance Company

            

    

    

    

    

    
      	 
      	
              By                /s/ Diane S.
      Griswold        

            
	 
      	
              Name: Diane S.
      Griswold

            
	 
      	
              Title: Second Vice
      President

            

    

    

    
      
        
           

        

         

      

      
        - 45
-

        
          

        

      

      
         

      

    

     

    The
foregoing is hereby agreed to as of the date thereof.

    

    

    
      	 
      	
              State
      Farm Life Insurance Company

            

    

    

    

    

    
      	 
      	
              By                /s/ Julie Pierce                                                             

            
	 
      	
              Name: Julie
    Pierce

            
	 
      	
              Title: Senior Investment
      Officer

            

    

    

    

    

    
      	 
      	
              By                /s/ Jeffrey T.
      Attwood        

            
	 
      	
              Name: Jeffrey T.
      Attwood

            
	 
      	
              Title: Investment
      Officer

            

    

    

    

    
      
        
           

        

         

      

      
        - 46
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    The
foregoing is hereby agreed to as of the date thereof.

    

    

    
      	 
      	
              Thrivent
      Financial for Lutherans

            

    

    

    

    

    
      	 
      	
              By                /s/ Alan D. Onstad                                                         

            
	 
      	
              Name: Alan D.
      Onstad

            
	 
      	
              Title: Senior
      Director

            

    

    
      
        
           

        

         

      

      
        - 47
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    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:

     

    “Affiliate” means, at any
time, and with respect to any Person, (a) 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, and (b) 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
corporation 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.  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.

     

    “Anti-Terrorism Order” means Executive Order
No. 13,224 of September 24, 2001, Blocking Property and Prohibiting
Transactions with Persons Who Commit, Threaten to Commit or Support Terrorism,
66 U.S. Fed. Reg. 49,079 (2001), as amended.

     

    “Attributable Debt” means, as
to any particular lease relating to a Sale and Leaseback Transaction, the total
amount of rent (discounted semiannually from the respective due dates thereof at
the interest rate implicit in such lease) required to be paid by the lessee
under such lease during the remaining term thereof.  The amount of
rent required to be paid under any such lease for any such period shall be (a)
the total amount of the rent payable by the lessee with respect to such period
after excluding amounts required to be paid on account of maintenance and
repairs, insurance, taxes, assessments, utilities, operating and labor costs and
similar charges plus (b) without duplication, any guaranteed residual value in
respect of such lease to the extent such guarantee would be included in
indebtedness in accordance with GAAP.

     

    “Business Day” means 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.

     

    “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.

     

    “Capitalized Lease
Obligations” means with respect to any Person, all outstanding
obligations of such Person in respect of Capital Leases, taken at the
capitalized amount thereof accounted for as indebtedness in accordance with
GAAP.

     

    “Closing” and “Closings” are defined in
Section 3.

     

    “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.

    
      
        
          Schedule
B

        

         

      

      
         

        
          

        

      

      
         

      

    

     

    “Company” means The United
Illuminating Company, a Connecticut corporation.

     

    “Confidential Information” is
defined in Section 20.

     

    “Consolidated Capitalization”
means, at any date, the sum of (a) Consolidated Indebtedness plus (b)
shareholders’ equity of all classes of stock (except mandatorily redeemable
Preferred Stock) of the Company and its Subsidiaries, all as determined on a
consolidated basis in accordance with GAAP.

     

    “Consolidated Indebtedness”
means, at any date, all Indebtedness of the Company and its Subsidiaries
determined on a consolidated basis in accordance with GAAP.

     

    “Consolidated Total Assets”
means, as of any date, the total assets of the Company and its Subsidiaries
determined on a consolidated basis in accordance with GAAP.

     

    “Default” means an event or
condition the occurrence or existence of which would, with the giving of notice
or the lapse of time, or both, become an Event of Default.

     

    “Default Rate” means, with
respect to a series of Notes, that rate of interest that is the greater of (i)
2% per annum above the stated interest rate for the Notes of such series and
(ii) 2% above the rate of interest publicly announced by Citibank, N.A.
from time to time at its principal office in New York City as its prime or base
rate. 

     

    “Disposition” is defined in
Section 10.5.

     

    “Environmental Laws” means,
with respect to a series of Notes, any and all United States 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 substances or wastes, air emissions
and discharges to waste or public systems.

     

    “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 from time to time.

     

    “Execution Date” is defined
in Section 3.

    
      
        
          B-2

        

         

      

      
         

        
          

        

      

      
         

      

    

    “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
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.

     

    “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 any other substances that
might pose a hazard to health or 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 

    
      
        
          B-3

        

         

      

      
         

        
          

        

      

      
         

      

    

     

    of which
is or shall be restricted, prohibited or penalized by any applicable law
(including without limitation asbestos, urea formaldehyde foam insulation and
polychlorinated biphenyls).

     

    “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.

     

    “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 and not
overdue but including all liabilities created or arising under any conditional
sale or other title retention agreement with respect to any such
property),

     

    (c)its
Capitalized Lease Obligations,

     

    (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)Swaps
of such Person not entered into for the purpose of hedging in the ordinary
course of business, and

     

    (g)any
Guaranty of such Person with respect to liabilities of a type described in any
of clauses (a) through (f) above.

     

    Indebtedness
of any Person shall include all obligations of such Person of the character
described in clauses (a) through (g) above to the extent such Person remains
legally liable in respect thereof notwithstanding that any such obligation is
deemed to be extinguished under GAAP.

     

    “Institutional Investor”
means (a) any original purchaser of a Note, (b) any holder of a Note
holding (together with one or more of its Affiliates) more than 2% of the
aggregate principal amount of the Notes then outstanding, and (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.

     

    “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 

    
      
        
          B-4

        

         

      

      
         

        
          

        

      

      
         

      

    

     

    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).

     

    “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 or (c) the validity or enforceability of this
Agreement or the Notes.

     

    “Memorandum” is defined in
Section 5.3.

     

    “Multiemployer Plan” means
any Plan that is a “multiemployer plan” (as such term is defined in
section 4001(a)(3) of ERISA).

     

    “Net Proceeds Amount” means,
with respect to any Disposition by any Person, an amount equal to the difference
of

     

    (a)the
aggregate amount of cash received by such Person in respect of such Disposition
at any time (including without limitation the payment of principal and interest
on any promissory note issued to such Person as consideration for such
Disposition or the cash proceeds received upon the disposition of non-cash
consideration received for such Disposition), minus

     

    (b)the
sum of

     

    (i)all
ordinary and reasonable out-of-pocket costs and expenses actually paid in cash
by such Person in connection with such Disposition;

     

    (ii)all
sales, transfer and income taxes attributable to such Disposition, it being
understood that income taxes in respect of such Disposition (A) shall be
determined on a consolidated basis for the Company and its Subsidiaries,
(B) shall be calculated without regard to any credits, deductions,
carryforwards or carrybacks (except to the extent that any such credits or
deductions are attributable to such Disposition), and (C) shall be computed on
the assumption that such Disposition was the only transaction in which the
Company and its Subsidiaries engaged during the period in respect of which such
income taxes are payable; and

     

    (iii)the
principal amount of Indebtedness (and premium thereon, if any) secured by such
asset that is required to be paid, and is paid, by such Person, as a condition
to the consummation of such Disposition.

    
      
        
          B-5

        

         

      

      
         

        
          

        

      

      
         

      

    

    “Notes” is defined in
Section 1.

     

    “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.

     

    “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, or a government or agency or political subdivision
thereof.

     

    “Plan” means an “employee
benefit plan” (as defined in section 3(3) 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 corporation that is preferred over any other class
of capital stock of such corporation as to the payment of dividends or the
payment of any amount upon liquidation or dissolution of such
corporation.

     

    “Priority Debt” is defined in
Section 10.3.

     

    “property” or “properties” means, unless
otherwise specifically limited, real or personal property of any kind, tangible
or intangible, inchoate or otherwise.

     

    “PTE” is defined in
Section 6.2.

     

    “Purchaser” is defined in the
first paragraph of this Agreement.

     

    “QPAM Exemption” means
Prohibited Transaction Class Exemption 84-14 issued on March 13, 1984
by the United States Department of Labor.

     

    “Required Holders” means, at
any time, the holder or holders of at least 51% in unpaid principal amount of
the Notes at the time outstanding (exclusive of Notes then owned by the Company
or any of its Affiliates).

     

    “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.

     

    “Sale and Leaseback Transaction”
is defined in Section 10.4.

     

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

    
      
        
          B-6

        

         

      

      
         

        
          

        

      

      
         

      

    

     

    “Senior Financial Officer”
means the chief financial officer, principal accounting officer, treasurer or
comptroller of the Company.

     

    “Series A Notes” is
defined in Section 1.

     

    “Series B Notes” is
defined in Section 1.

     

    “Series C Notes” is
defined in Section 1.

     

    “Significant Subsidiary”
means, at any date, any Subsidiary that accounts for more than 5% of the
consolidated assets of the Company and its Subsidiaries on such date or
accounted for more than 5% of the consolidated revenue of the Company and its
Subsidiaries for the fiscal year ending on or immediately prior to such
date.

     

    “Subsidiary” means, as to any
Person, any corporation, association or other business entity in which such
Person or one or more of its Subsidiaries or such 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 entity, and any
partnership or joint venture if more than a 50% interest in the profits or
capital thereof is owned by such Person or one or more of its Subsidiaries or
such Person and one or more of its Subsidiaries (unless such partnership 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.

     

    “Swaps” means, with respect
to any Person, payment obligations with respect to interest rate swaps, currency
swaps and similar obligations obligating such Person to make payments, whether
periodically or upon the happening of a contingency.  For the purposes
of this Agreement, the amount of the obligation under any Swap shall be the
amount determined in respect thereof as of the end of the then most recently
ended fiscal quarter of such Person, based on the assumption that such Swap had
terminated at the end of such fiscal quarter, and in making such determination,
if any agreement relating to such Swap provides for the netting of amounts
payable by and to such Person thereunder or if any such agreement provides for
the simultaneous payment of amounts by and to such Person, then in each such
case, the amount of such obligation shall be the net amount so
determined.

     

    “UIL Holdings” means UIL
Holdings Corporation, a Connecticut corporation.

     

    “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.

     

    “Voting Stock” means, with
respect to any Person, any shares of stock or other equity interests of any
class or classes of such Person whose holders are entitled under ordinary
circumstances (irrespective of whether at the time stock or other equity
interests of any other class or classes shall have or might have voting power by
reason of the happening of any contingency) to vote for the election of a
majority of the directors, managers, trustees or other governing body of such
Person.

    
      
        
          B-7

        

         

      

      
         

        
          

        

      

      
         

      

    

     

    “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.

     

    

    
      
        
          B-8

        

         

      

      
         

        
          

        

      

      
         

      

    

    [Form
of Note]

    

    The
United Illuminating Company

     

    6.46%
Senior Note, Series A, due November 3, 2018

     

    
      	
               
      

            	
              No.
      RA-[_____]                                                                                                            New York, New
  York

            

    

    
      	
               
      

            	
              $[_______]                                                                                                              
    [Date]

            

    

    
      	
               
      

            	
              PPN:
      910637 Q*1

            

    

     

     

    For Value
Received, the undersigned, The United Illuminating Company (the “Company”), a Connecticut
corporation, hereby promises to pay to _____________________, or registered
assigns, the principal sum of ___________________ Dollars ($_________) on
November 3, 2018, with interest (computed on the basis of a 360-day year of
twelve 30-day months) (a) from the date hereof on the unpaid balance
thereof at the rate of 6.46% per annum, payable semiannually on _________ and
__________ in each year, commencing with the __________ or _________, and
(b) on any overdue payment of principal, any overdue payment of interest
and any overdue payment of any premium or Make-Whole Amount (as defined in the
Note Purchase Agreement referred to below), payable semiannually as aforesaid
(or, at the option of the registered holder hereof, on demand) at a rate per
annum from time to time equal to the greater of (i) 8.46% and (ii) 2% above
the rate of interest publicly announced by Citibank, N.A. from time to time at
its principal office in New York, New York as its prime or base
rate.

     

    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 at said principal
office of Citibank, N.A. in New York, New York or at such other place as the
Company shall have designated by written notice to the holder of this Note as
provided in the Note Purchase Agreement referred to below.

     

    This Note
is one of the 6.46% Senior Notes due November 3, 2018 issued pursuant to a
Note Purchase Agreement dated as of July 29, 2008 (as from time to time
amended, the “Note Purchase
Agreement”) between the Company and the several Purchasers named therein
and is entitled to the benefits thereof.  Each holder of this Note
will be deemed, by its acceptance hereof, (i) to have agreed to the
confidentiality provisions set forth in Section 20 of the Note Purchase
Agreement and (ii) to have made the representations set forth in Section 6
of the Note Purchase Agreement.

     

    This Note
is a registered Note and, as provided in the Note Purchase 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 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 may 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.

    
      
        
          Exhibit
1-A

        

         

      

      
         

        
          

        

      

      
         

      

    

    This Note
is subject to optional prepayments of principal in whole or from time to time in
part, at the times and on the terms specified in the Note Purchase Agreement,
but not otherwise.

     

    If an
Event of Default, as defined in the Note Purchase Agreement, occurs and is
continuing, the principal of this Note may be declared or otherwise become due
and payable in the manner, at the price (including any applicable premium or
Make-Whole Amount) and with the effect provided in the Note Purchase
Agreement.

     

    This Note
shall be construed and enforced in accordance with, and the rights of the holder
hereof shall be governed by, the laws of the State of New York, excluding
choice-of-law principles of the law of such State that would require the
application of the laws of a jurisdiction other than such State.

     

    

     

    
      	 
      	
              The
      United Illuminating Company

            

    

    

    

    

    
      	 
      	
              By                                                                    

            
	 
      	
              Title:

            

    

    
      
        
          1-A-2

        

         

      

      
         

        
          

        

      

      
         

      

    

    [Form
of Note]

    

    The
United Illuminating Company

     

    6.51%
Senior Note, Series B, due December 1, 2018

     

    
      	
               
      

            	
              No.
      RB-[_____]                                                                                                        New York, New
      York

            

    

    
      	
               
      

            	
              $[_______]                                                                                                          [Date]

            

    

    
      	
               
      

            	
              PPN:  910637
      Q@9

            

    

     

     

    For Value
Received, the undersigned, The United Illuminating Company (the “Company”), a Connecticut
corporation, hereby promises to pay to _____________________, or registered
assigns, the principal sum of ___________________ Dollars ($_________) on
December 1, 2018, with interest (computed on the basis of a 360-day year of
twelve 30-day months) (a) from the date hereof on the unpaid balance
thereof at the rate of 6.51% per annum, payable semiannually on ________ and
_________ in each year, commencing with the ________ or __________ next
succeeding the date hereof, until the principal hereof shall have become due and
payable, and (b) on any overdue payment of principal, any overdue payment
of interest and any overdue payment of any premium or Make-Whole Amount (as
defined in the Note Purchase Agreement referred to below), payable semiannually
as aforesaid (or, at the option of the registered holder hereof, on demand) at a
rate per annum from time to time equal to the greater of (i) 8.51% and
(ii) 2% above the rate of interest publicly announced by Citibank, N.A.
from time to time at its principal office in New York, New York as its prime or
base rate.

     

    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 at said principal
office of Citibank, N.A. in New York, New York or at such other place as the
Company shall have designated by written notice to the holder of this Note as
provided in the Note Purchase Agreement referred to below.

     

    This Note
is one of the 6.51% Senior Notes due December 1, 2018 issued pursuant to a
Note Purchase Agreement dated as of July 29, 2008 (as from time to time
amended, the “Note Purchase
Agreement”) between the Company and the several Purchasers named therein
and is entitled to the benefits thereof.  Each holder of this Note
will be deemed, by its acceptance hereof, (i) to have agreed to the
confidentiality provisions set forth in Section 20 of the Note Purchase
Agreement and (ii) to have made the representations set forth in Section 6
of the Note Purchase Agreement.

     

    This Note
is a registered Note and, as provided in the Note Purchase 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 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 may treat the person in whose name this Note is registered as the
owner hereof for the purpose of receiving

    
      
        
          Exhibit
1-B

        

         

      

      
         

        
          

        

      

      
         

      

    

     

    payment
and for all other purposes, and the Company will not be affected by any notice
to the contrary.

     

    This Note
is subject to optional prepayments of principal in whole or from time to time in
part, at the times and on the terms specified in the Note Purchase Agreement,
but not otherwise.

     

    If an
Event of Default, as defined in the Note Purchase Agreement, occurs and is
continuing, the principal of this Note may be declared or otherwise become due
and payable in the manner, at the price (including any applicable premium or
Make-Whole Amount) and with the effect provided in the Note Purchase
Agreement.

     

    This Note
shall be construed and enforced in accordance with, and the rights of the holder
hereof shall be governed by, the laws of the State of New York, excluding
choice-of-law principles of the law of such State that would require the
application of the laws of a jurisdiction other than such State.

     

    

     

    
      	 
      	
              The
      United Illuminating Company

            

    

    

    

    

    
      	 
      	
              By                                                                    

            
	 
      	
              Title:

            

    

    

    
      
        
          1-B-2

        

         

      

      
         

        
          

        

      

      
         

      

    

    [Form
of Note]

    

    The
United Illuminating Company

     

    6.61%
Senior Note, Series C, due December 1, 2020

     

    
      	
               
      

            	
              No.
      RC-[_____]                                                                                                    New York, New
      York

            

    

    
      	
               
      

            	
              $[_______]                                                                                                      [Date]

            

    

    
      	
               
      

            	
              PPN:  910637
      Q#7

            

    

     

     

    For Value
Received, the undersigned, The United Illuminating Company (the “Company”), a Connecticut
corporation, hereby promises to pay to _____________________, or registered
assigns, the principal sum of ___________________ Dollars ($_________) on
December 1, 2020, with interest (computed on the basis of a 360-day year of
twelve 30-day months) (a) from the date hereof on the unpaid balance
thereof at the rate of 6.61% per annum, payable semiannually on ________ and
_________ in each year, commencing with the ________ or __________ next
succeeding the date hereof, until the principal hereof shall have become due and
payable, and (b) on any overdue payment of principal, any overdue payment
of interest and any overdue payment of any premium or Make-Whole Amount (as
defined in the Note Purchase Agreement referred to below), payable semiannually
as aforesaid (or, at the option of the registered holder hereof, on demand) at a
rate per annum from time to time equal to the greater of (i) 8.61% and
(ii) 2% above the rate of interest publicly announced by Citibank, N.A.
from time to time at its principal office in New York, New York as its prime or
base rate.

     

    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 at said principal
office of Citibank, N.A. in New York, New York or at such other place as the
Company shall have designated by written notice to the holder of this Note as
provided in the Note Purchase Agreement referred to below.

     

    This Note
is one of the 6.61% Senior Notes due December 1, 2020 issued pursuant to a
Note Purchase Agreement dated as of July 29, 2008 (as from time to time
amended, the “Note Purchase
Agreement”) between the Company and the several Purchasers named therein
and is entitled to the benefits thereof.  Each holder of this Note
will be deemed, by its acceptance hereof, (i) to have agreed to the
confidentiality provisions set forth in Section 20 of the Note Purchase
Agreement and (ii) to have made the representations set forth in Section 6
of the Note Purchase Agreement.

     

    This Note
is a registered Note and, as provided in the Note Purchase 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 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 may treat the person in whose name this Note is registered as the
owner hereof for the purpose of receiving

    
      
        
          Exhibit
1-C

        

         

      

      
         

        
          

        

      

      
         

      

    

     

    payment
and for all other purposes, and the Company will not be affected by any notice
to the contrary.

     

    This Note
is subject to optional prepayments of principal in whole or from time to time in
part, at the times and on the terms specified in the Note Purchase Agreement,
but not otherwise.

     

    If an
Event of Default, as defined in the Note Purchase Agreement, occurs and is
continuing, the principal of this Note may be declared or otherwise become due
and payable in the manner, at the price (including any applicable premium or
Make-Whole Amount) and with the effect provided in the Note Purchase
Agreement.

     

    This Note
shall be construed and enforced in accordance with, and the rights of the holder
hereof shall be governed by, the laws of the State of New York, excluding
choice-of-law principles of the law of such State that would require the
application of the laws of a jurisdiction other than such State.

     

    

     

    
      	 
      	
              The
      United Illuminating Company

            

    

    

    

    

    
      	 
      	
              By                                                                    

            
	 
      	
              Title:

            

    

    

     

    1-C-2Exhibit 10.1

 

[EXECUTION COPY]

 

FIRST AMENDMENT TO CREDIT AGREEMENT

 

This FIRST AMENDMENT TO CREDIT AGREEMENT,
dated as of April 8, 2008 (this “Amendment”), among (i) WHITE MOUNTAINS INSURANCE GROUP, LTD., a
company existing under the laws of Bermuda (the “Borrower”), (ii) the
undersigned Lenders, and (iii) BANK OF
AMERICA, N.A., as administrative agent for the Lenders (in such
capacity, the “Administrative Agent”), amends certain provisions of the
Credit Agreement, dated as of June 19, 2007 (as amended, the “Credit
Agreement”), among the Borrower, the Lenders, Bank of America, N.A., as
Administrative Agent, Swing Line Lender and the Issuing Lender, and Lehman
Brothers Inc., as Syndication Agent. 
Capitalized terms used herein without definition shall have the meanings
assigned to such terms in the Credit Agreement. 
As used herein “Lender Group” means collectively, each Lender and its
Affiliates who are Lenders.

 

RECITALS

 

WHEREAS, the Borrower has requested that the undersigned
Lenders and the Administrative Agent agree to amend certain of the terms and
provisions of the Credit Agreement, as specifically set forth in this
Amendment; and

 

WHEREAS, the undersigned Lenders and the Administrative
Agent are prepared to amend the Credit Agreement on the terms, subject to the
conditions and in reliance on the representations set forth herein.

 

NOW THEREFORE, in consideration of the mutual agreements
contained in the Credit Agreement and herein and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties hereto hereby agree as follows:

 

Section 1.         Amendment
to Credit Agreement.

 

(a)         Amendments to Section 7.2(b) (Limitation on
Indebtedness).  Section 7.2(b) of
the Credit Agreement is hereby amended by restating such Section in its
entirety as follows:

 

“At any time when OneBeacon Limited is
required to be consolidated on the balance sheet of the Borrower in accordance
with GAAP, the Borrower will not permit OneBeacon Limited to create, incur or
assume any Indebtedness, which, at the time such Indebtedness is created,
incurred or otherwise assumed, would cause the OneBeacon Limited Debt to
Capitalization Ratio, on a pro forma basis as of the end of the most recently
completed fiscal quarter for which financial statements have been delivered to
the Administrative Agent pursuant to Section 6.1(b) (giving
effect to such Indebtedness and all other Indebtedness created, incurred or
otherwise assumed by OneBeacon Limited since the end of such fiscal quarter),
to be greater than (i) thirty-seven and one half of one percent (37.5%)
for any fiscal quarter ending prior to November 14, 2008 and (ii) thirty-five
percent (35%) for any fiscal quarter ending on or after November 14, 2008.”

 

 

Section 2.         Conditions
Precedent.  This
Amendment shall become effective as of the date first written above upon (a) execution
hereof by the Borrower, the Guarantors, the Administrative Agent and the
Majority Lenders, and (b) the Administrative Agent’s receipt, for the
account of each Lender consenting to this Amendment, a work fee in the amount
of $5,000 per such Lender and its Affiliates who are Lenders, which fee shall
be deemed fully earned and non-refundable upon receipt thereof.

 

Section 3.         Continued Validity of Loan Documents.  Except for the amendments to the Credit
Agreement set forth in Section 1 hereof, this Amendment shall not,
by implication or otherwise, limit, impair, constitute a waiver of or otherwise
affect any rights or remedies of the Administrative Agent or any Lender under
any of the Loan Documents, nor alter, modify, amend or in any way affect any of
the rights, remedies, obligations or any covenants of the Borrower or any
Guarantor contained in any of the other Loan Documents, all of which are
ratified and confirmed in all respects and shall continue in full force and
effect.

 

Section 4.         Representations
and Warranties.  Each of the
Borrower and the Guarantors (each, a “Loan Party”) hereby represents and
warrants to the Administrative Agent and the Lenders as follows:

 

(a)        Due Execution and Authorization; Legal, Valid and Binding
Obligation.  This Amendment has been
duly executed and delivered by such Loan Party. 
The execution and delivery and performance by such Loan Party of this
Amendment is within such Person’s corporate powers and has been duly authorized
by all necessary action on its part. 
This Amendment, the Credit Agreement as amended hereby and all other
Loan Documents to which such Person is a party constitute the legal, valid and
binding obligations of such Person, enforceable against such Person in
accordance with its terms, except as enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or similar Laws
affecting the enforcement of creditors’ rights generally and by general
equitable principles (whether enforcement is sought by proceedings in equity or
at law).

 

(b)        No Legal Bar. 
The execution and delivery by such Loan Party of this Amendment and the
performance by such Person of this Amendment and the Credit Agreement as
amended hereby, will not violate any Requirement of Law or any Contractual
Obligation of such Loan Party or any of its Subsidiaries and will not result
in, or require, the creation or imposition of any Lien on any of their
respective properties or revenues pursuant to any Requirement of Law or any
such Contractual Obligation, except to the extent such violation or Lien could
not, in the aggregate, reasonably be expected to have a Material Adverse
Effect.

 

(c)        Representations and Warranties in Loan Documents.  All representations and warranties of each
Loan Party set forth in the Credit Agreement and in any other Loan Document are
true and correct in all material respects on and as of the date hereof to the
same extent as though made on and as of such date, except to the extent such
representations and warranties specifically relate to an earlier date, in which
case such representations and warranties shall have been true and correct in
all material respects on and as of such earlier date.

 

(d)        No Default.  No Default or Event of Default has occurred
and is continuing.

 

2

 

Section 5.         Ratification.  Except as expressly amended or waived hereby,
the Credit Agreement, the other Loan Documents and all documents, instruments
and agreements related thereto, are hereby ratified and confirmed in all
respects and shall continue in full force and effect.  The Credit Agreement, together with this
Amendment, shall be read and construed as a single agreement.  All references in the Loan Documents to the
Credit Agreement or any other Loan Document shall hereafter refer to the Credit
Agreement or any other Loan Document as amended hereby.

 

Section 6.         Counterparts;
Integration; Effectiveness.  This Amendment may be executed in counterparts
(and by different parties hereto in different counterparts), each of which
shall constitute an original, but all of which when taken together shall
constitute a single contract.  Delivery
of an executed counterpart of a signature page to this Amendment by
telecopier (or electronic mail (in PDF format)) shall be effective as delivery
of a manually executed counterpart of this Amendment.

 

Section 7.         Miscellaneous. 
This Amendment constitutes the entire agreement of the parties with
respect to the subject matter hereof and supersedes any prior understandings or
agreements which may have existed with respect thereto.  Except as expressly provided herein, this
Amendment shall not, by implication or otherwise, limit, impair, constitute a
waiver of or otherwise affect any rights or remedies of the Administrative
Agent or any Lender under the Credit Agreement or the other Loan Documents, nor
alter, modify, amend or in any way affect any of the obligations or covenants
contained in the Credit Agreement or any of the other Loan Documents, all of
which are ratified and confirmed in all respects and shall continue in full
force and effect.  To the extent there is
any inconsistency between the terms and provisions of any Loan Document and the
terms and provisions of this Amendment, the terms and provisions of this
Amendment shall govern.  The headings
used in this Amendment are for convenience of reference only and shall not in
any way be deemed to limit, define or describe the scope and intent of this
Amendment or any provision hereof.  This
Amendment shall be binding upon and inure to the benefit of the Administrative
Agent, each of the Lenders and each of the Loan Parties, and to each of their
respective successors in title and assigns. 
This Amendment may not be modified or amended except in a manner
permitted by Section 10.1 of the Credit Agreement.  In making proof of this Amendment, it shall
not be necessary to produce or account for more than one such counterpart.

 

Section 8.         Costs and Expenses.  Pursuant to Section 10.5 of the Credit
Agreement, all reasonable out-of-pocket costs and expenses incurred or
sustained by the Administrative Agent in connection with this Amendment,
including all Attorney Costs of the Administrative Agent in producing, reproducing
and negotiating this Amendment, will be for the account of the Borrower whether
or not this Amendment is consummated.

 

Section 9.         Governing
Law. 
THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER
SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND INTERPRETED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK (EXCLUDING THE LAWS APPLICABLE TO
CONFLICTS OR CHOICE OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAW OF
ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY).

 

3

 

[Remainder of page intentionally blank.]

 

4

 

IN WITNESS WHEREOF, the parties hereto have
caused this Amendment to be executed and delivered as of the date first above
written.

 

	
   

  	
  Borrower:

  
	
   

  	
   

  
	
   

  	
  WHITE
  MOUNTAINS INSURANCE GROUP, 

  LTD.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

First Amendment to Credit
Agreement

 

 

	
   

  	
  BANK OF
  AMERICA, N.A., as

  
	
   

  	
  Administrative Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

First Amendment to Credit
Agreement

 

 

	
   

  	
  BANK OF AMERICA,
  N.A., as

  
	
   

  	
  a Lender, Issuing Lender
  and Swing Line Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

First Amendment to Credit
Agreement

 

 

	
   

  	
  LEHMAN
  BROTHERS BANK, FSB, as

  
	
   

  	
  a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

First Amendment to Credit
Agreement

 

 

	
   

  	
  BNP
  PARIBAS, as

  
	
   

  	
  a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

First Amendment to Credit
Agreement

 

 

	
   

  	
  THE BANK
  OF NEW YORK, as

  
	
   

  	
  a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

First Amendment to Credit
Agreement

 

 

	
   

  	
  THE BANK
  OF TOKYO-MITSUBISHI UFJ. 

  LTD., NEW YORK BRANCH, as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

First Amendment to Credit
Agreement

 

 

	
   

  	
  DEUTSCHE
  BANK AG NEW YORK 

  BRANCH, as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

First Amendment to Credit
Agreement

 

 

	
   

  	
  HSBC BANK
  USA, N.A., as

  
	
   

  	
  a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

First Amendment to Credit
Agreement

 

 

	
   

  	
  JP MORGAN
  CHASE BANK, N.A., as

  
	
   

  	
  a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

First Amendment to Credit
Agreement

 

 

	
   

  	
  MELLON
  BANK, N.A., as

  
	
   

  	
  a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

First Amendment to Credit
Agreement

 

 

	
   

  	
  PNC BANK, as

  
	
   

  	
  a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

First Amendment to Credit
Agreement

 

 

	
   

  	
  THE ROYAL BANK OF SCOTLAND, 

  PLC, as a Lender

  
	
   

  	
   

  
	
   

  	
  By:
  GREENWICH CAPITAL MARKETS, 

  INC., as agent for The Royal Bank of 

  Scotland plc

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

First Amendment to Credit
Agreement

 

 

	
   

  	
  STATE
  STREET BANK AND TRUST 

  COMPANY, as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

First Amendment to Credit
Agreement

 

 

	
   

  	
  WELLS
  FARGO BANK, NATIONAL 

  ASSOCIATION, as a Lender

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

First Amendment to Credit
Agreement

 

 

RATIFICATION
OF GUARANTY

 

Each of the undersigned
Guarantors hereby (a) acknowledges and consents to the foregoing Amendment
and the Borrower’s execution thereof, (b) joins the foregoing Amendment for the sole purpose of consenting to and being bound by the provisions
of Sections 4 and 5 thereof and (c) ratifies and confirms all of
their respective obligations and liabilities under the Loan Documents to which
any of them is a party and ratifies and confirms that such obligations and
liabilities extend to and continue in effect with respect to, and continue to
guarantee the obligations of the Borrower under the Loan Documents.

 

	
   

  	
  WHITE MOUNTAINS HOLDINGS 

  BERMUDA LTD.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  LONE TREE INSURANCE GROUP LTD.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  LONE TREE HOLDINGS LTD.

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

First Amendment to Credit
Agreement

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00145-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00145-of-00352.parquet"}]]