Document:

Exhibit 10.1

 

Confidential Treatment Requested by Momenta Pharmaceuticals, Inc.

 

COLLABORATION AND LICENSE AGREEMENT

 

By and Among

 

Momenta Pharmaceuticals, Inc.

 

and

 

Sandoz AG

 

 

June 13, 2007

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

 

Table of Contents

 

	
 
    	
 
    	
Page
    
	
 
    	
 
    	
 
    
	
1.
    	
DEFINITIONS
    	
1
    
	
 
    	
1.1.
    	
“Affiliate”
    	
1
    
	
 
    	
1.2.
    	
“[**]”
    	
2
    
	
 
    	
1.3.
    	
“Annual Collaboration   Plan”
    	
2
    
	
 
    	
1.4.
    	
“Application”
    	
2
    
	
 
    	
1.5.
    	
“Application Final   Approval”
    	
2
    
	
 
    	
1.6.
    	
“Business Day”
    	
2
    
	
 
    	
1.7.
    	
“cGMP”
    	
2
    
	
 
    	
1.8.
    	
“Characterize” or   “Characterization”
    	
2
    
	
 
    	
1.9.
    	
“Change in Control”
    	
3
    
	
 
    	
1.10.
    	
“Collaboration   Know-How”
    	
3
    
	
 
    	
1.11.
    	
“Collaboration Product”
    	
3
    
	
 
    	
1.12.
    	
“Collaboration   Product-Specific Patent Rights”
    	
3
    
	
 
    	
1.13.
    	
“Collaborative Program”
    	
3
    
	
 
    	
1.14.
    	
“Commercial Scale   Validation Costs”
    	
3
    
	
 
    	
1.15.
    	
“Commercial Year”
    	
3
    
	
 
    	
1.16.
    	
“Commercialization,”   “Commercialize” or “Commercializing”
    	
4
    
	
 
    	
1.17.
    	
“Commercialization   Costs”
    	
4
    
	
 
    	
1.18.
    	
“Commercially   Reasonable”
    	
4
    
	
 
    	
1.19.
    	
“Committee”
    	
5
    
	
 
    	
1.20.
    	
“Community of Interest   Letters and Agreements”
    	
5
    
	
 
    	
1.21.
    	
“Confidential   Information”
    	
5
    
	
 
    	
1.22.
    	
“Consumer Price Index”
    	
5
    
	
 
    	
1.23.
    	
“Contract Year”
    	
5
    
	
 
    	
1.24.
    	
“Control” or   “Controlled”
    	
5
    
	
 
    	
1.25.
    	
“Controlled Contractor”
    	
5
    
	
 
    	
1.26.
    	
“Copaxone-Equivalent   Product”
    	
6
    
	
 
    	
1.27.
    	
“Copaxone-Referenced   Product”
    	
6
    
	
 
    	
1.28.
    	
“Cost of Goods Sold”
    	
6
    
	
 
    	
1.29.
    	
“Develop” or   “Development”
    	
7
    
	
 
    	
1.30.
    	
“Development Costs”
    	
7
    
	
 
    	
1.31.
    	
“EMEA”
    	
7
    
	
 
    	
1.32.
    	
“[**]-Equivalent   Product”
    	
7
    
	
 
    	
1.33.
    	
“[**] Product-Specific   Patent Rights”
    	
8
    
	
 
    	
1.34.
    	
“[**]-Referenced   Product”
    	
8
    
	
 
    	
1.35.
    	
“Equity Agreements”
    	
8
    
	
 
    	
1.36.
    	
“European Territory”
    	
8
    
	
 
    	
1.37.
    	
“Executive Officers”
    	
8
    
	
 
    	
1.38.
    	
“Existing US Lovenox   Agreement”
    	
8
    
	
 
    	
1.39.
    	
“FDA”
    	
8
    
	
 
    	
1.40.
    	
“Field”
    	
8
    
	
 
    	
1.41.
    	
“Final ROW Legal   Clearance”
    	
8
    
	
 
    	
1.42.
    	
“Final U.S. Legal   Clearance”
    	
9
    
	
 
    	
1.43.
    	
“First Commercial Sale”
    	
9
    

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

i

 

	
 
    	
 
    	
 
    	
Page
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
1.44.
    	
“[**]-Equivalent   Product”
    	
9
    
	
 
    	
1.45.
    	
“[**] Product-Specific   Patent Rights”
    	
9
    
	
 
    	
1.46.
    	
“[**]-Referenced   Product”
    	
10
    
	
 
    	
1.47.
    	
“FTE”
    	
10
    
	
 
    	
1.48.
    	
“FTE Costs”
    	
10
    
	
 
    	
1.49.
    	
“Full Affiliate”
    	
10
    
	
 
    	
1.50.
    	
“Fully-Substitutable”   or “Full-Substitutability”
    	
10
    
	
 
    	
1.51.
    	
“GAAP”
    	
10
    
	
 
    	
1.52.
    	
“Glycoprotein Product”
    	
11
    
	
 
    	
1.53.
    	
“Glycoprotein   Product-Related Patent Rights”
    	
11
    
	
 
    	
1.54.
    	
“IFRS” means   International Financial Reporting Standards
    	
11
    
	
 
    	
1.55.
    	
“Improvement”
    	
11
    
	
 
    	
1.56.
    	
“Innovator”
    	
11
    
	
 
    	
1.57.
    	
“Investor Rights   Agreement”
    	
11
    
	
 
    	
1.58.
    	
“JAM”
    	
11
    
	
 
    	
1.59.
    	
“Joint Collaboration   IP”
    	
11
    
	
 
    	
1.60.
    	
“Joint Collaboration   Know-How”
    	
11
    
	
 
    	
1.61.
    	
“Joint Collaboration   Patent Rights”
    	
11
    
	
 
    	
1.62.
    	
“Joint Product-Specific   Know-How”
    	
11
    
	
 
    	
1.63.
    	
“Joint Product-Specific   Patent Rights”
    	
11
    
	
 
    	
1.64.
    	
“Know-How”
    	
12
    
	
 
    	
1.65.
    	
“Label”
    	
12
    
	
 
    	
1.66.
    	
“Launch”
    	
12
    
	
 
    	
1.67.
    	
“Legal Activities”
    	
12
    
	
 
    	
1.68.
    	
“Legal Clearance”
    	
12
    
	
 
    	
1.69.
    	
“Legal Clearance Costs”
    	
12
    
	
 
    	
1.70.
    	
“Legal Costs”
    	
12
    
	
 
    	
1.71.
    	
“Legal Expenses”
    	
12
    
	
 
    	
1.72.
    	
“Lovenox-Equivalent   Product”
    	
13
    
	
 
    	
1.73.
    	
“Lovenox-Referenced   Product”
    	
13
    
	
 
    	
1.74.
    	
“Marketing Approval”
    	
13
    
	
 
    	
1.75.
    	
“MIT”
    	
13
    
	
 
    	
1.76.
    	
“MIT Agreement”
    	
13
    
	
 
    	
1.77.
    	
“Momenta Collaboration   Know-How”
    	
13
    
	
 
    	
1.78.
    	
“Momenta Collaboration   Patent Rights”
    	
14
    
	
 
    	
1.79.
    	
“Momenta Indemnified   Parties”
    	
14
    
	
 
    	
1.80.
    	
“Momenta IP”
    	
14
    
	
 
    	
1.81.
    	
“Momenta Know-How”
    	
14
    
	
 
    	
1.82.
    	
“Momenta Patent Rights”
    	
14
    
	
 
    	
1.83.
    	
“Momenta   Product-Specific Know-How”
    	
14
    
	
 
    	
1.84.
    	
“Momenta   Product-Specific Patent Rights”
    	
14
    
	
 
    	
1.85.
    	
“Momenta Profit   Percentage”
    	
14
    
	
 
    	
1.86.
    	
“Momenta Third Party   Royalty Obligations”
    	
15
    
	
 
    	
1.87.
    	
“MOU”
    	
15
    

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

ii

 

	
 
    	
 
    	
 
    	
Page
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
1.88.
    	
“MOU Effective Date”
    	
15
    
	
 
    	
1.89.
    	
“Net Sales”
    	
15
    
	
 
    	
1.90.
    	
“Non-Owning Party”
    	
15
    
	
 
    	
1.91.
    	
“Non-Substitutable   Product”
    	
15
    
	
 
    	
1.92.
    	
“[**]”
    	
16
    
	
 
    	
1.93.
    	
“[**]”
    	
16
    
	
 
    	
1.94.
    	
“Owning Party”
    	
16
    
	
 
    	
1.95.
    	
“Owning Party’s IP”
    	
16
    
	
 
    	
1.96.
    	
“Paragraph IV   Certifications”
    	
16
    
	
 
    	
1.97.
    	
“[**]”
    	
16
    
	
 
    	
1.98.
    	
“Party”
    	
16
    
	
 
    	
1.99.
    	
“Patent Litigation”
    	
16
    
	
 
    	
1.100.
    	
“Patent Right”
    	
16
    
	
 
    	
1.101.
    	
“Person”
    	
17
    
	
 
    	
1.102.
    	
“Pre Final Legal   Clearance Launch”
    	
17
    
	
 
    	
1.103.
    	
“Prior Confidentiality   Agreements”
    	
17
    
	
 
    	
1.104.
    	
“Prior Obligations”
    	
17
    
	
 
    	
1.105.
    	
“Product”
    	
17
    
	
 
    	
1.106.
    	
“Product-Specific   Patent Activities”
    	
17
    
	
 
    	
1.107.
    	
“Product-Specific   Patent Costs”
    	
17
    
	
 
    	
1.108.
    	
“Product-Specific   Patent Rights”
    	
17
    
	
 
    	
1.109.
    	
“Profits”
    	
17
    
	
 
    	
1.110.
    	
“Quarter”
    	
18
    
	
 
    	
1.111.
    	
“Reference Drug”
    	
18
    
	
 
    	
1.112.
    	
“Reference-Equivalent   Product”
    	
18
    
	
 
    	
1.113.
    	
“Region”
    	
18
    
	
 
    	
1.114.
    	
“Regulatory Authority”
    	
18
    
	
 
    	
1.115.
    	
“Related Product”
    	
18
    
	
 
    	
1.116.
    	
“Research Institution”
    	
18
    
	
 
    	
1.117.
    	
“Sandoz Collaboration   Know-How”
    	
18
    
	
 
    	
1.118.
    	
“Sandoz Collaboration   Patent Rights”
    	
18
    
	
 
    	
1.119.
    	
“Sandoz Indemnified   Parties”
    	
19
    
	
 
    	
1.120.
    	
“Sandoz IP”
    	
19
    
	
 
    	
1.121.
    	
“Sandoz Know-How”
    	
19
    
	
 
    	
1.122.
    	
“Sandoz Material”
    	
19
    
	
 
    	
1.123.
    	
“Sandoz MFN Project”
    	
19
    
	
 
    	
1.124.
    	
“Sandoz Patent Rights”
    	
19
    
	
 
    	
1.125.
    	
“Sandoz   Product-Specific Know-How”
    	
19
    
	
 
    	
1.126.
    	
“Sandoz   Product-Specific Patent Rights”
    	
19
    
	
 
    	
1.127.
    	
“Sanofi-Aventis”
    	
19
    
	
 
    	
1.128.
    	
“Selling Expenses”
    	
20
    
	
 
    	
1.129.
    	
“[**]”
    	
20
    
	
 
    	
1.130.
    	
“Settlement”
    	
20
    
	
 
    	
1.131.
    	
“Settlement Costs”
    	
20
    

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

iii

 

	
 
    	
 
    	
 
    	
Page
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
1.132.
    	
“Stock Purchase   Agreement”
    	
20
    
	
 
    	
1.133.
    	
“Sublicense Income”
    	
20
    
	
 
    	
1.134.
    	
“Territory”
    	
21
    
	
 
    	
1.135.
    	
“Teva”
    	
21
    
	
 
    	
1.136.
    	
“Third Party”
    	
21
    
	
 
    	
1.137.
    	
“Third Party Royalties”
    	
21
    
	
 
    	
1.138.
    	
“[**]”
    	
21
    
	
 
    	
1.139.
    	
“U.S. Territory”
    	
21
    
	
 
    	
1.140.
    	
Other Defined Terms
    	
21
    
	
2.
    	
GRANT OF RIGHTS
    	
23
    
	
 
    	
2.1.
    	
Momenta License Grants
    	
23
    
	
 
    	
2.2.
    	
Sandoz License Grants
    	
23
    
	
 
    	
2.3.
    	
Exclusivity
    	
24
    
	
 
    	
2.4.
    	
Retained Rights
    	
24
    
	
 
    	
2.5.
    	
Third Party Licensor   Rights
    	
24
    
	
 
    	
2.6.
    	
Bankruptcy
    	
25
    
	
3.
    	
SANDOZ MFN PROJECTS
    	
25
    
	
 
    	
3.1.
    	
Sandoz MFN Project   Rights
    	
25
    
	
 
    	
3.2.
    	
Freedom
    	
26
    
	
4.
    	
FINANCIAL PAYMENTS
    	
26
    
	
4.1.
    	
Costs
    	
 
    	
26
    
	
 
    	
4.2.
    	
Milestone Payments
    	
28
    
	
 
    	
4.3.
    	
Profit and Sublicense   Income Sharing
    	
31
    
	
 
    	
4.4.
    	
Payment/Accounting
    	
31
    
	
5.
    	
JOINT DEVELOPMENT AND   COMMERCIALIZATION
    	
33
    
	
 
    	
5.1.
    	
Joint Collaboration
    	
33
    
	
 
    	
5.2.
    	
Sandoz Final-Decision   Making Authority
    	
34
    
	
 
    	
5.3.
    	
[**]
    	
34
    
	
 
    	
5.4.
    	
Joint Project Team
    	
34
    
	
 
    	
5.5.
    	
Alliance Managers
    	
35
    
	
 
    	
5.6.
    	
Joint Operating   Committee
    	
35
    
	
 
    	
5.7.
    	
JOC Responsibilities
    	
36
    
	
 
    	
5.8.
    	
Joint Steering   Committee
    	
36
    
	
 
    	
5.9.
    	
JSC Administration
    	
36
    
	
 
    	
5.10.
    	
JSC Responsibilities
    	
37
    
	
 
    	
5.11.
    	
JPT, JOC and/or JSC   Meetings
    	
37
    
	
 
    	
5.12.
    	
Termination of   Committees
    	
37
    
	
 
    	
5.13.
    	
Annual Collaboration   Plans
    	
37
    
	
 
    	
5.14.
    	
Compliance with Laws
    	
38
    
	
 
    	
5.15.
    	
Legal Clearance
    	
38
    
	
6.
    	
ADDITIONAL   COMMERCIALIZATION PROVISIONS
    	
38
    
	
 
    	
6.1.
    	
Review and Oversight
    	
38
    
	
 
    	
6.2.
    	
Pre Final Legal   Clearance Launch
    	
39
    

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

iv

 

	
 
    	
 
    	
 
    	
Page
    
	
 
    	
 
    	
 
    	
 
    
	
7.
    	
REGULATORY MATTERS
    	
39
    
	
 
    	
7.1.
    	
Review and Oversight
    	
39
    
	
 
    	
7.2.
    	
Application Filing
    	
39
    
	
 
    	
7.3.
    	
Ownership Of The   Applications
    	
39
    
	
 
    	
7.4.
    	
Application   Responsibility
    	
39
    
	
 
    	
7.5.
    	
Regulatory Interaction
    	
39
    
	
 
    	
7.6.
    	
Regulatory Policy
    	
40
    
	
8.
    	
INTELLECTUAL PROPERTY
    	
40
    
	
 
    	
8.1.
    	
Ownership
    	
40
    
	
 
    	
8.2.
    	
Patent Prosecution
    	
41
    
	
 
    	
8.3.
    	
Participation of Other   Persons
    	
45
    
	
 
    	
8.4.
    	
Enforcement of Patent   Rights
    	
45
    
	
 
    	
8.5.
    	
Claimed Infringement
    	
50
    
	
 
    	
8.6.
    	
Patent Invalidity Claim
    	
50
    
	
 
    	
8.7.
    	
Obligations to   Licensors
    	
50
    
	
 
    	
8.8.
    	
Patent Marking
    	
51
    
	
9.
    	
WARRANTIES
    	
51
    
	
 
    	
9.1.
    	
Representations and   Warranties of the Parties
    	
51
    
	
 
    	
9.2.
    	
No Reliance by Third   Parties
    	
52
    
	
 
    	
9.3.
    	
No Other Warranties
    	
52
    
	
10.
    	
CONFIDENTIALITY
    	
53
    
	
 
    	
10.1.
    	
Prior Confidentiality Agreements
    	
53
    
	
 
    	
10.2.
    	
Confidential   Information
    	
53
    
	
 
    	
10.3.
    	
Nondisclosure of   Confidential Information
    	
53
    
	
 
    	
10.4.
    	
Exceptions
    	
53
    
	
 
    	
10.5.
    	
Identification
    	
54
    
	
 
    	
10.6.
    	
Equitable Relief
    	
54
    
	
 
    	
10.7.
    	
Survival
    	
54
    
	
11.
    	
TERM &   TERMINATION
    	
54
    
	
 
    	
11.1.
    	
Term
    	
54
    
	
 
    	
11.2.
    	
Termination For Cause
    	
55
    
	
 
    	
11.3.
    	
Need for Clinical   Trials for Collaboration Products
    	
55
    
	
 
    	
11.4.
    	
Sandoz Termination of   Glycoprotein Products
    	
55
    
	
 
    	
11.5.
    	
Momenta Termination of   Glycoprotein Products
    	
56
    
	
 
    	
11.6.
    	
Interpretation
    	
56
    
	
 
    	
11.7.
    	
Effects of Termination
    	
56
    
	
 
    	
11.8.
    	
Survival
    	
64
    
	
 
    	
11.9.
    	
Non-Exclusive Remedy
    	
65
    
	
12.
    	
INDEMNIFICATION
    	
65
    
	
 
    	
12.1.
    	
Sandoz Indemnification   of Momenta
    	
65
    
	
 
    	
12.2.
    	
Momenta Indemnification   of Sandoz
    	
65
    
	
 
    	
12.3.
    	
Final Misappropriation   Determination
    	
66
    
	
 
    	
12.4.
    	
Procedure
    	
66
    
	
 
    	
12.5.
    	
Sharing of Legal   Expenses
    	
67
    
	
 
    	
12.6.
    	
Insurance
    	
68
    

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

v

 

	
 
    	
 
    	
 
    	
Page
    
	
 
    	
 
    	
 
    	
 
    
	
13.
    	
DISPUTE RESOLUTION
    	
68
    
	
 
    	
13.1.
    	
First Level Resolution
    	
68
    
	
 
    	
13.2.
    	
Negotiation Between   Executives
    	
68
    
	
 
    	
13.3.
    	
Legal Remedies
    	
68
    
	
14.
    	
ADDITIONAL PROVISIONS
    	
68
    
	
 
    	
14.1.
    	
Entire Agreement
    	
68
    
	
 
    	
14.2.
    	
Amendments and Waiver
    	
69
    
	
 
    	
14.3.
    	
Assignment
    	
69
    
	
 
    	
14.4.
    	
Nature of Relationship
    	
69
    
	
 
    	
14.5.
    	
Notices
    	
70
    
	
 
    	
14.6.
    	
Governing Law
    	
70
    
	
 
    	
14.7.
    	
Jurisdiction and Venue
    	
71
    
	
 
    	
14.8.
    	
Jury Waiver
    	
71
    
	
 
    	
14.9.
    	
Counterparts; Facsimile   Signature
    	
71
    
	
 
    	
14.10.
    	
Severability
    	
71
    
	
 
    	
14.11.
    	
Expenses
    	
71
    
	
 
    	
14.12.
    	
Further Actions and   Documents
    	
71
    
	
 
    	
14.13.
    	
Use of Trade Names and   Trademarks
    	
71
    
	
 
    	
14.14.
    	
Affiliates
    	
72
    
	
 
    	
14.15.
    	
Exports
    	
72
    
	
 
    	
14.16.
    	
Force Majeure
    	
72
    
	
 
    	
14.17.
    	
Non-Use of MIT Name
    	
72
    
	
 
    	
14.18.
    	
Headings
    	
72
    
	
 
    	
14.19.
    	
Construction
    	
73
    
	
 
    	
14.20.
    	
No Consequential   Damages
    	
73
    

 

	
Schedule  1.28
    	
–      Cost of Goods Sold
    
	
Schedule  1.82
    	
–      Current Momenta Patent Rights
    
	
Schedule  1.89
    	
–    Net   Sales
    
	
Schedule  1.124
    	
–      Current Sandoz Patent Rights
    

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

vi

 

EXECUTION VERSION

 

COLLABORATION AND LICENSE AGREEMENT

 

This Collaboration and License Agreement (“Agreement”) is entered into as of this 13th day of June, 2007 (“Effective Date”), by and between Momenta Pharmaceuticals, Inc., a Delaware corporation (“Momenta”) with a principal place of business at 675 West Kendall Street, Cambridge, MA 02142, and Sandoz AG, a Swiss corporation (“Sandoz”) with a principal place of business at Lichtstraße 35, CH 4056 Basel BS, Switzerland.

 

RECITALS

 

WHEREAS, Momenta is a biotechnology company with specific expertise in the science of complex mixtures of peptides, sugars and polysaccharides; their structures, their compositional analysis, their sequencing, and their characterization;

 

WHEREAS, Sandoz has substantial knowledge and expertise in the research, development, manufacture and sale of pharmaceuticals;

 

WHEREAS, Sandoz and Momenta wish to collaborate to develop and commercialize the Products (as defined herein), under the terms and conditions specified herein; and

 

WHEREAS, SandozInc., an Affiliate of Sandoz, and Sandoz AG (via assignment from Sandoz N.V. (f.k.a. Biochemie West Indies, N.V.)) and Momenta are parties to the Existing US Lovenox Agreement (as defined herein), which relates to the development and commercialization of the Lovenox-Referenced Product (as defined herein) in the U.S. Territory (as defined herein);

 

NOW, THEREFORE, in consideration of the mutual promises and covenants set forth herein, the Parties agree as follows:

 

1.                   DEFINITIONS

 

When used in this Agreement, each of the following terms shall have the meanings set forth in this Article 1:

 

1.1.          “Affiliate”.  Affiliate means any corporation, company, partnership, joint venture and/or firm that controls, is controlled by, or is under common control with a Person.  For purposes of this Section 1.1, “control” means (a) in the case of corporate entities, direct or indirect ownership of at least fifty percent (50%) of the stock or shares having the right to vote for the election of directors, and (b) in the case of non-corporate entities, direct or indirect ownership of at least fifty percent (50%) of the equity interest with the power to direct the management and policies of such non-corporate entities.  The Parties acknowledge that in the case of certain entities organized under the laws of certain countries outside the United States, the maximum percentage ownership permitted by law for a foreign investor may be less than fifty percent (50%), and that in such case such lower percentage shall be substituted in the preceding sentence, provided that such foreign investor has the power to direct the management and policies of such entity.

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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1.2.          “[**]”.  [**] means (a) [**] (b) its Affiliates, (c) any Person licensed to distribute by [**] or its Affiliates for an [**]-Equivalent Product (the Persons described in Sections 1.2(a), (b) and (c), collectively, the “[**] Persons”), and (d) the successors and assigns of any [**] Persons with respect to any rights to any [**]-Equivalent Product.

 

1.3.          “Annual Collaboration Plan”.  Annual Collaboration Plan means, with respect to a Product, the Development, Commercialization and Legal Activities plan for such Product, including goals, responsibilities, budgets and timelines for such activities, to be developed by the applicable JPT, submitted to the JOC, and approved by the JSC for each Contract Year, and including forecasts for subsequent Contract Years, in accordance with this Agreement.

 

1.4.          “Application”.  Application means:  (a) with respect to the U.S. Territory, any of the following:  (i) an Abbreviated New Drug Application filed with the FDA or any successor applications or procedures seeking authorization and approval to manufacture, package, ship, and sell a product in the U.S. Territory; (ii) any other regulatory filing in the U.S. Territory, including without limitation filings that are similar to filings under clause (i), such as a BLA, an NDA, supplemental NDA or an application pursuant to Section 505(b)(2) of the United States Federal Food, Drug, and Cosmetic Act (the “FD&C Act”) or pursuant to the United States Public Health Service Act; and (iii) all supplements and amendments that may be filed with respect to the foregoing; and (b) with respect to any other relevant jurisdiction in the world, any equivalent of the items in clause (a) in such jurisdiction, including, without limitation, any Marketing Approval Application filed with any Regulatory Authority (including the EMEA and the European Commission, as applicable) in the European Territory.

 

1.5.          “Application Final Approval”.  Application Final Approval means, with respect to a Product in a country in the relevant Territory or, for the relevant purposes of Section 4.2.1, a Fully-Substitutable Copaxone-Equivalent Product in the U.S. Territory, the granting by the relevant Regulatory Authority of final Marketing Approval (with “Marketing Approval” and its incorporated terms applying to the Copaxone-Equivalent Product to the same extent as they apply to Products) for an Application for such Product or Fully-Substitutable Copaxone-Equivalent Product, respectively, in such country.

 

1.6.          “Business Day”.  Business Day means any day that is not a Saturday, Sunday or other day on which commercial banks located in the State of New York and Munich, Germany are authorized or required to be closed.

 

1.7.          “cGMP”.  cGMP means current good manufacturing practices as set forth in Title 21, Parts 210 and 211 of the CFR, as established by FDA or as set forth in analogous foreign laws or foreign regulations as established by foreign Regulatory Authorities, as applicable.

 

1.8.          “Characterize” or “Characterization”.  Characterize or Characterization, with respect to a Product, means chemical, physical and biological characterization of such Product and the applicable Reference Drug with sufficient specificity, and documentation thereof as is necessary to establish to the satisfaction of the relevant Regulatory Authority in the respective Territory that the active ingredient of such Product is the same as that of the applicable Reference Drug, as required to submit an Application.

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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1.9.          “Change in Control”.  Change in Control means, with respect to a Party, the closing of a tender offer, stock purchase, other stock acquisition, merger, consolidation, recapitalization, reverse split, sale or transfer of assets or other transaction (a “Transaction”), as a result of which any Person or group (as such term is defined under Section 13(d) of the Securities Exchange Act of 1934, as amended) (a) becomes the beneficial owner, directly or indirectly, of securities of such Party representing more than fifty percent (50%) of the common stock of such Party or representing more than fifty percent (50%) of the combined voting power with respect to the election of directors (or members of any other governing body) of such Party’s then outstanding securities, (b) obtains the ability to appoint a majority of the Board of Directors (or other governing body) of such Party or (c) obtains the ability to direct the operations or management of such Party or any successor to such Party’s business, unless, immediately following such Transaction, all or substantially all of the Persons and groups who were the beneficial owners of such Party’s voting securities immediately prior to such Transaction beneficially own, directly or indirectly, more than fifty percent (50%) of the combined voting securities of the resulting or surviving entity in such Transaction; provided, however, that a Change in Control shall not result from any Transaction that occurs solely between such Party and any one or more of its then-current Affiliates.

 

1.10.        “Collaboration Know-How”.  Collaboration Know-How means Sandoz Collaboration Know-How, Joint Collaboration Know-How and Momenta Collaboration Know-How.

 

1.11.        “Collaboration Product”.  Collaboration Product means each of the Copaxone-Referenced Product and the Lovenox-Referenced Product.

 

1.12.        “Collaboration Product-Specific Patent Rights”.  Collaboration Product-Specific Patent Rights means the Product-Specific Patent Rights, other than [**] Product-Specific Patent Rights and [**] Product-Specific Patent Rights.

 

1.13.        “Collaborative Program”.  Collaborative Program means the Development and Commercialization of, and conduct of Legal Activities with respect to, the Products in the relevant Territories, as applicable, within the Field, under this Agreement as described in Articles 5, 6 and 7 and in the Annual Collaboration Plans.

 

1.14.        “Commercial Scale Validation Costs”.  Commercial Scale Validation Costs means, with respect to a Product, each Party’s FTE Costs, and all out-of-pocket costs paid by Sandoz or Momenta to Third Parties after the Effective Date, in connection with validation of commercial scale process (for drug substance and drug product, as well as associated stability studies) for such Product for sale in the relevant Territory pursuant to this Agreement, which, with respect to such costs that are borne in whole or in part by the other Party, are incurred in accordance with the relevant Annual Collaboration Plan, and any capital investment with respect thereto.  Commercial Scale Validation Costs with respect to a Product also include failed validation batches with respect to such Product.

 

1.15.        “Commercial Year”.  Commercial Year means, with respect to the Copaxone-Referenced Product and the Lovenox-Referenced Product, respectively, the twelve (12) month period beginning on the first day of the calendar month immediately following the First

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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Commercial Sale of such Product in any country in the U.S. Territory (for the Copaxone-Referenced Product) or the European Territory (for the Lovenox-Referenced Product), respectively (the first Commercial Year), and (b) each twelve (12) month period beginning on the anniversary of such day (the second Commercial Year, the third Commercial Year, etc.).

 

1.16.        “Commercialization,” “Commercialize” or “Commercializing”.  Commercialization, Commercialize or Commercializing means, with respect to a Product, any and all activities directed to (a) commercial manufacturing (including, without limitation, the manufacture of commercial supply for distribution in the relevant Territory and the manufacture of commercial inventory); (b) marketing, promoting, distributing, importing, offering for sale and/or selling such Product; and (c) post-Launch regulatory affairs for such Product.  “Commercialization,” “Commercialize” or “Commercializing” does not include Development or Legal Activities.

 

1.17.        “Commercialization Costs”.  Commercialization Costs means, with respect to a Product, each Party’s FTE Costs, and all out-of-pocket costs paid by Sandoz or Momenta to Third Parties after the Effective Date, in connection with (a) Commercializing such Product for sale in the relevant Territory pursuant to this Agreement, which, with respect to such costs that are borne in whole or in part by the other Party, are incurred in accordance with the relevant Annual Collaboration Plan, (b) any capital investment with respect to Commercialization, and (c) Commercial Scale Validation Costs.  Commercialization Costs with respect to a Product also include inventory not sold with respect to such Product.  Commercialization Costs do not include (a) Development Costs, (b) the Momenta Third Party Royalty Obligations, (c) Third Party Royalties, (d) Product-Specific Patent Costs or other patent costs allocated pursuant to Article 8, (e) Legal Expenses, or (f) amounts relating to commercializing the Lovenox-Referenced Product in the U.S. Territory.  For the avoidance of doubt, Commercialization Costs shall [**].  If Sandoz requests Momenta’s assistance with commercial manufacturing activities, Sandoz will reimburse aspects of Cost of Goods Sold that are performed by Momenta within [**] days after receipt of such invoice.

 

1.18.        “Commercially Reasonable”.  Commercially Reasonable means, with respect to the efforts to be expended by a Party with respect to any objective or with respect to the decision to be made by a Party, reasonable, diligent, good faith efforts to accomplish such objective as such Party would normally use to accomplish a similar objective, or making such decision in reasonable, good faith as such Party would normally make, in each case under similar circumstances exercising reasonable business judgment, it being understood and agreed that, with respect to the Development or Commercialization of a Product or Legal Activities, such efforts, or decisions, shall be substantially equivalent to those efforts and resources commonly used, or decisions commonly made, by such Party for a product owned by it or to which it has rights, which product is at a similar stage in its development or product life and is of similar market potential, taking into account efficacy, safety, approved labeling, the competitiveness of alternative products in the marketplace, the patent and other proprietary position of the Product, the likelihood of regulatory approval given the regulatory structure involved, the profitability of the Product, alternative products and other relevant factors commonly considered in similar circumstances.  It is anticipated that the level of effort, and the decisions, will change over time, reflecting changes in the status of the Product.

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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1.19.        “Committee”.  Committee means each of the JSC, the JOC, each JPT, the Regulatory and Policy Strategy Team and the Legal / Intellectual Property Team.

 

1.20.        “Community of Interest Letters and Agreements”.  Community of Interest Letters and Agreements means the two Community of Interest letters between Momenta, on the one hand, and [**], on the other hand, dated as of [**], and the Agreement [**], between Momenta, on the one hand, and [**], on the other hand, dated [**]; and all revisions and modifications thereto agreed upon in writing by the Parties.

 

1.21.        “Confidential Information”.  Confidential Information means all Know-How or other confidential or proprietary information and materials (whether or not patentable) regarding a Party’s technology, products or business, which (a) if disclosed in writing, is designated as confidential in writing by the Disclosing Party, whether by letter or by the use of an appropriate stamp or legend, prior to or at the time any such Know-How or other information or material is disclosed by the Disclosing Party to the Receiving Party, (b) if disclosed orally or visually, is identified as confidential at the time of disclosure, or (c) is of the type that is customarily considered to be confidential by persons engaged in activities that are substantially similar to the activities being engaged in by the Parties pursuant to this Agreement.  “Confidential Information” shall not include information:  (i) which is or becomes generally available to the public other than as a result of disclosure thereof by the Receiving Party; (ii) which is lawfully received by the Receiving Party on a non-confidential basis from a Third Party that is not itself under any obligation of confidentiality or nondisclosure to the Disclosing Party or any other Person with respect to such information; (iii) which is already known to the Receiving Party at the time of disclosure by the Disclosing Party, or (iv) which can be shown by the Receiving Party to have been independently developed by the Receiving Party without reference to the Disclosing Party’s Confidential Information.

 

1.22.        “Consumer Price Index”.  Consumer Price Index means the Consumer Price Index — Urban Wage Earners and Clerical Workers, U.S. City Average, All Items, 1982-84 = 100, published by the United States Department of Labor, Bureau of Labor Statistics (or its successor equivalent index).

 

1.23.        “Contract Year”.  Contract Year means the period beginning on the Effective Date and ending on December 31, 2007 (the “First Contract Year”), and/or each succeeding twelve (12) month calendar year period thereafter during the Term (referred to as the “Second Contract Year”, “Third Contract Year”, etc.).

 

1.24.        “Control” or “Controlled”.  Control or Controlled means with respect to any item of Know-How or any intellectual property right, the possession, whether by ownership or license (other than pursuant to a license granted under this Agreement or the Existing US Lovenox Agreement), by a Party or any of its Affiliates of the ability to grant to the other Party access and/or a license as provided herein under such item or right without violating the terms of any agreement or arrangement with any Third Party existing before or after the Effective Date.

 

1.25.        “Controlled Contractor”.  Controlled Contractor means (a) a Third Party contractor such as a contract research organization, contract service organization, contract

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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employee, consultant and the like who merely conducts activities on behalf of such Party and is subject to such Party’s supervision and control, or (b) a Third Party contract manufacturer.

 

1.26.        “Copaxone-Equivalent Product”.  Copaxone-Equivalent Product means (a) Copaxone® in injectable form sold as a brand, including Copaxone® if sold by Teva and/or its co-distributors or licensees using another tradename (collectively, “Branded Copaxone”), or (b) any injectable product sold in the relevant Territory (other than Branded Copaxone) that is a generic A-rated therapeutically equivalent, for the U.S. Territory, or foreign equivalent thereof, to Copaxone® in injectable form.  For the avoidance of doubt, Copaxone-Equivalent Product excludes any new chemical entities.

 

1.27.        “Copaxone-Referenced Product”.  Copaxone-Referenced Product means injectable (syringe and vial) glatiramer acetate for which (a) the reference listed drug is (i) listed in US New Drug Application No. 020622 or (ii) equivalents of such reference listed drug in each other country in the relevant Territory, and (b) an Application could be approved by the relevant Regulatory Authority.  For the avoidance of doubt, Copaxone-Referenced Product excludes any new chemical entities.

 

1.28.        “Cost of Goods Sold”.  Cost of Goods Sold means, with respect to a Product, the aggregate of each Party’s cost to commercially manufacture, test, package and/or Label such Product (including the buildup of commercial inventory), calculated as follows (“Cost”):

 

1.28.1.     For such Product, the cost for manufacturing, testing, packaging, and/or Labeling performed by a Third Party shall equal the costs as invoiced by such Third Party for the manufacture, testing, packaging and/or Labeling of the specified quantity of such Product; and

 

1.28.2.     For such Product, the cost for manufacturing, testing, packaging, and/or Labeling performed by Sandoz or its Affiliates shall equal the costs that are incurred by Sandoz or its Affiliates in connection with the manufacture, testing, packaging, Labeling and delivery to a warehouse(s) designated by Sandoz of the specified quantity of such Product, calculated pursuant to the Novartis principal accounting policies (as detailed in Schedule 1.28), and determined from the books and records of Sandoz or its Affiliates maintained in accordance with GAAP or IFRS, consistently applied.

 

1.28.3.     For such Product, any Commercialization activities performed by Momenta pursuant to this Agreement shall be calculated on a fee-for-service basis, based on the number of machine hours, FTEs, consumables and similar measurable quantities, as well as administrative charges, calculated at the rates which Momenta would charge to Third Parties on an arms-length basis, and with such amounts determined from the books and records of Momenta or its Affiliates maintained in accordance with GAAP, consistently applied.

 

Sandoz, through its relevant Affiliates, retains the right to modify the Novartis principal accounting policies to comply with specific changes in GAAP or IFRS.  The revised calculation of Cost of Goods Sold resulting from such modifications is subject to the consent of Momenta, such consent not to be unreasonably withheld.

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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Cost of Goods Sold must be calculated with reasonable approximation to actual costs (use of standard cost plus variances (purchase price, production, etc) to achieve actual costs), including provisions for and subsequent charges to obsolescence.  The Cost of free goods is included in Cost of Goods Sold.

 

If Third Party Royalties are payable with respect to a Collaboration Product after Launch of such Product in the relevant country, such amounts shall be included in Cost of Goods Sold for purposes of calculating the Profits with respect to such Product, subject to Section 4.1.5.  For the sake of clarity, Third Party Royalties with respect to Glycoprotein Products shall be borne in accordance with Section 4.1.5.

 

Notwithstanding the foregoing, Cost of Goods Sold hereunder excludes Costs relating to the Lovenox-Referenced Product in the U.S. Territory.

 

1.29.        “Develop” or “Development”.  Develop or Development means, with respect to a Product, all activities up to and including development of commercial scale process for such Product, whether such activities are conducted prior to the filing of the relevant Application(s) for such Product in the relevant country(ies) in the relevant Territory or thereafter until Application Final Approval of such Product in each such country, including:  (a) Characterization of such Product; (b) preclinical and, if applicable, clinical studies, bioequivalence studies, development of analytical assays, stability studies and quality analysis/quality control development; (c) formulation, process development and development of commercial scale process; (d) validation of commercial scale process (for drug substance and drug product, as well as associated stability studies) (but all costs with respect thereto are included in Commercialization Costs as Commercial Scale Validation Costs); (e) statistical analysis; and (f) pre-Launch regulatory affairs (including legal activities with respect thereto).  Notwithstanding the foregoing, “Develop” or “Development” does not include Commercialization or Legal Activities.

 

1.30.        “Development Costs”.  Development Costs means, with respect to a Product, each Party’s FTE Costs (collectively) and all out-of-pocket costs paid by Sandoz or Momenta to Third Parties (collectively) after the Effective Date in connection with the Development (other than Commercial Scale Validation Costs) of such Product for commercialization in the relevant Territory (including, without limitation, Controlled Contractors in connection with the Development of such Product) which, with respect to such costs that are borne in whole or in part by the other Party, are incurred in accordance with the relevant Annual Collaboration Plan.  Development Costs do not include:  (a) Momenta Third Party Royalty Obligations; (b) Third Party Royalties; (c) Commercialization Costs; (d) Product-Specific Patent Costs or other patent costs allocated pursuant to Article 8; (e) Legal Expenses; (f) amounts relating to the development of the Lovenox-Referenced Product in the U.S. Territory; or (g) Commercial Scale Validation Costs.

 

1.31.        “EMEA”.  EMEA means The European Agency for the Evaluation of Medicinal Products.

 

1.32.        “[**]-Equivalent Product”.  [**]-Equivalent Product means (a) [**] in injectable form sold as a brand, including [**] using another tradename (collectively, “Branded [**]”), or

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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(b) any injectable product sold in the U.S. Territory (other than Branded [**]) that is a generic A-rated therapeutically equivalent to [**] in injectable form.  For the avoidance of doubt, an [**]-Equivalent Product excludes any new chemical entities.  The Parties agree that the product sold as the brand [**] shall not be considered an [**]-Equivalent Product.

 

1.33.        “[**] Product-Specific Patent Rights”.  [**] Product-Specific Patent Rights means those Sandoz Product-Specific Patent Rights, Momenta Product-Specific Patent Rights and Joint Product-Specific Patent Rights that solely relate to the [**]-Referenced Product and do not relate to, and cannot reasonably be used with, any other product or for any general purpose.

 

1.34.        “[**]-Referenced Product”.  [**]-Referenced Product means injectable [**] for which the reference listed drug is [**] as listed in U.S. Biologic License Application No. [**] and for which an Application could be approved by the FDA for the U.S. Territory and which product has (a) [**], (b) [**], and (c) [**].  For the avoidance of doubt, [**]-Referenced Product excludes any new chemical entities.  For clarity, any product for which an Application citing [**] as the reference listed drug could be approved shall not be considered an [**]-Referenced Product.

 

1.35.        “Equity Agreements”.  Equity Agreements means the Stock Purchase Agreement and the Investor Rights Agreement.

 

1.36.        “European Territory”.  European Territory means (a) the member states of the European Union, as may be revised from time to time, and (b) Andorra, Iceland, Liechtenstein, Monaco, Norway, Switzerland, San Marino and Vatican City.

 

1.37.        “Executive Officers”.  Executive Officers means (a) with respect to the First Contract Year, the Chief Executive Officer of Sandoz and the Chief Executive Officer of Momenta, and (b) thereafter, with respect to each Party, (i) the Chief Executive Officer of such Party or (ii) a global vice-president (or other title) who reports directly to the Chief Executive Officer of such Party and who is not then a co-chair of the JSC or JOC.

 

1.38.        “Existing US Lovenox Agreement”.  Existing US Lovenox Agreement means the Collaboration and License Agreement, dated November 1, 2003, by and among Momenta, Sandoz Inc. and Sandoz AG (via assignment from Sandoz N.V. (f.k.a. Biochemie West Indies, N.V.)), as may be amended from time to time.

 

1.39.        “FDA”.  FDA means the United States Food and Drug Administration, or any successor agency thereto.

 

1.40.        “Field”.  Field means the injectable administration of the Products for all therapeutic indications.

 

1.41.        “Final ROW Legal Clearance”.   Final ROW Legal Clearance means, with respect to a Product in a country in the Territory but outside the U.S. Territory, the earliest of:  (i) receipt by a Party or any of its Affiliates of a final, unappealable judgment that determines that marketing of such Product does not infringe the relevant Innovator’s Patent Rights (due to non-infringement, invalidity and/or unenforceability); or (ii) receipt by a Third Party of a final, unappealable judgment in a patent infringement suit between the relevant Innovator and such

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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Third Party, which would permit the marketing of such Product without infringing the relevant Innovator’s Patent Rights, either (A) because such Patent Rights have been declared invalid or unenforceable, or (B) as determined by the JSC in its judgment, even if such Patent Rights have not been declared invalid or unenforceable; or (iii) a Settlement with respect to all such Patent Rights.

 

1.42.        “Final U.S. Legal Clearance”.  Final U.S. Legal Clearance means, with respect to a Product in the U.S. Territory, (a) the absence of Patent Litigation, in the U.S. Territory, (i) pursuant to 21 U.S.C. 355(c)(3)(C) or 355(j)(5)(B)(iii) with respect to the patents listed in the Orange Book and/or any subsequent similar compendium for the relevant Reference Drug (any of the foregoing compendia, the “Orange Book”), such patents, “Orange Book Patent Rights”) if an Orange Book patent filing is legally permitted or required with respect to the Reference Drug, or (ii) with respect to the relevant Innovator’s Patent Rights, if an Orange Book patent filing is not legally available for the Reference Drug, in each of cases (i) and (ii), prior to the granting of Application Final Approval for such Product in such country, or (b) in the event that such Patent Litigation occurs in such country prior to the granting of Application Final Approval for such Product, the earliest of:  (i) receipt by a Party or any of its Affiliates of a final, unappealable judgment that determines that marketing of such Product does not infringe (A) the relevant Innovator’s Orange Book Patent Rights if an Orange Book patent filing is legally permitted or required for the Reference Drug, or (B) the relevant Innovator’s Patent Rights, if an Orange Book patent filing is not legally available for the Reference Drug; or (ii) receipt by a Third Party of a final, unappealable judgment in a patent infringement suit between the relevant Innovator and such Third Party, which would permit the marketing of such Product without infringing (A) the relevant Innovator’s Orange Book Patent Rights if an Orange Book patent filing is legally permitted or required for the Reference Drug, or (B) the relevant Innovator’s Patent Rights, if an Orange Book patent filing is not legally available for the Reference Drug, either (y) because such Patent Rights have been declared invalid or unenforceable, or (z) as determined by the JSC, even if such Patent Rights have not been declared invalid or unenforceable; or (iii) a Settlement with respect to all such Patent Rights.

 

1.43.        “First Commercial Sale”.  First Commercial Sale means, with respect to a Product in a country in the relevant Territory, the first commercial sale of such Product in such country by Sandoz, its Affiliates and/or distributors, or by sublicensees approved by the Parties.  Sales for test marketing, clinical trial purposes or compassionate or similar use shall not give rise to a First Commercial Sale.

 

1.44.        “[**]-Equivalent Product”.  [**]-Equivalent Product means (a) [**] in injectable form sold as a brand, including [**] using another tradename and/or [**] using another tradename (collectively, “Branded [**]”), or (b) any injectable product sold in the European Territory (other than Branded [**]) that is granted or has a rating equivalent to a U.S. generic A-rated therapeutically equivalent to [**] in injectable form.  For the avoidance of doubt, [**]-Equivalent Product excludes any new chemical entities.

 

1.45.        “[**] Product-Specific Patent Rights”.  [**] Product-Specific Patent Rights means those Sandoz Product-Specific Patent Rights, Momenta Product-Specific Patent Rights and Joint Product-Specific Patent Rights that solely relate to the [**]-Referenced Product and do not relate to, and cannot reasonably be used with, any other product or for any general purpose.

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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1.46.        “[**]-Referenced Product”.  [**]-Referenced Product means injectable [**] for which (A) the reference listed drug is (i) [**] as listed in any of the Marketing Authorizations with the base No. [**] granted by the European Commission or [**] as listed in the Marketing Authorizations with the base No. [**] granted by the European Commission, or (ii) [**] as listed in any further national marketing authorizations granted by authorities of countries in the European Territory other than the member states of the European Union, Norway, Iceland and Liechtenstein, or, (iii) listed in any duplicate of the aforesaid Marketing Authorizations under (i) or (ii) which is based on an essentially identical dossier, and for which (B) an Application could be approved by the European Commission for the European Territory and which product has (x) [**], (y) [**], and (z) [**].  For the avoidance of doubt, [**]-Referenced Product excludes any new chemical entities.

 

1.47.        “FTE”.  FTE means a full time equivalent person year (consisting of a total of [**] hours per year) of scientific, legal, technical or managerial work on or directly related to the Collaborative Program.

 

1.48.        “FTE Costs”.  FTE Costs means U.S.$[**] per FTE, increased or decreased in each calendar year by the percentage increase or decrease in the Consumer Price Index as of the then most recent December 31 over the level of the Consumer Price Index as of December 31, 2005.

 

1.49.        “Full Affiliate”.  Full Affiliate means any corporation, company, partnership, joint venture and/or firm that fully controls, is fully controlled by, or is under common full control with a Person.  For purposes of this Section 1.49, “full control” means (a) in the case of corporate entities, direct or indirect ownership of one hundred percent (100%) of the stock or shares having the right to vote for the election of directors, and (b) in the case of non-corporate entities, direct or indirect ownership of one hundred percent (100%) of the equity interest with the power to direct the management and policies of such non-corporate entities.

 

1.50.        “Fully-Substitutable” or “Full-Substitutability”.  “Fully-Substitutable” or “Full-Substitutability” means (a) with respect to a Collaboration Product or, for the relevant purposes of Section 4.2, a Copaxone-Equivalent Product or Lovenox-Equivalent Product, the authorized claim of A-rated therapeutically equivalent or otherwise therapeutically equivalent, as defined in the Orange Book, with respect to the U.S. Territory, or the foreign equivalent thereof in the relevant country in the relevant Territory (outside the U.S. Territory), and (b) with respect to a Glycoprotein Product, (i) with respect to the U.S. Territory, a determination by the FDA of therapeutic equivalence or other interchangeability with the relevant Reference Drug, and (ii) with respect to the applicable Territory (outside the U.S. Territory), (A) a determination of interchangeability with the relevant Reference Drug permitting the physician to switch the relevant Reference Drug with the relevant Glycoprotein Product, which determination has been made by the appropriate Regulatory Authority or by applicable laws or regulations, or (B) other substitutability with the relevant Reference Drug for the relevant Territory for the purpose of payor reimbursement, which has been established by a grant of the competent Regulatory Authority or by applicable laws or regulations.

 

1.51.        “GAAP”.  GAAP means United States Generally Accepted Accounting Principles.

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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1.52.        “Glycoprotein Product”.  Glycoprotein Product means each of the [**]-Referenced Product and the [**]-Referenced Product.

 

1.53.        “Glycoprotein Product-Related Patent Rights”.  Glycoprotein Product-Related Patent Rights means Patent Rights covering Collaboration Know-How in the relevant Territory, which directly cover (including claims that recite the composition of matter) any Glycoprotein Product, including [**] Product-Specific Patent Rights and [**]-Product-Specific Patent Rights.

 

1.54.        “IFRS” means International Financial Reporting Standards.

 

1.55.        “Improvement”.  Improvement means any enhancement to Sandoz Know-How, Momenta Know-How, Sandoz Collaboration Know-How or Momenta Collaboration Know-How, as the case may be, based on and arising from exposure to such Know-How and made during the conduct of the Collaborative Program, including enhancements made to such Improvements during the conduct of the Collaborative Program.

 

1.56.        “Innovator”.  Innovator means (a) with respect to the Copaxone-Referenced Product, Teva; (b) with respect to the Lovenox-Referenced Product, Sanofi-Aventis; (c) with respect to the [**]-Referenced Product, [**] and [**], collectively; and (d) with respect to the [**]-Referenced Product, [**] and/or [**].

 

1.57.        “Investor Rights Agreement”.  Investor Rights Agreement means the Investor Rights Agreement entered into by Momenta and Novartis Pharma AG on July 25, 2006.

 

1.58.        “JAM”.  JAM means Joint Alliance Manager.

 

1.59.        “Joint Collaboration IP”.  Joint Collaboration IP means Joint Collaboration Know-How and Joint Collaboration Patent Rights.

 

1.60.        “Joint Collaboration Know-How”.  Joint Collaboration Know-How means all Know-How (other than works of authorship) conceived, or, solely with respect to works of authorship, authored, jointly by Sandoz or its Affiliates, on the one hand, and Momenta or its Affiliates, on the other hand, during and in the conduct of the Collaborative Program, excluding those Improvements to Sandoz Know-How, Improvements to Sandoz Collaboration Know-How, Improvements to Momenta Know-How or Improvements to Momenta Collaboration Know-How which are made jointly by Sandoz or its Affiliates, on the one hand, and Momenta or its Affiliates, on the other hand.

 

1.61.        “Joint Collaboration Patent Rights”.  Joint Collaboration Patent Rights means all Patent Rights throughout the world covering the Joint Collaboration Know-How.

 

1.62.        “Joint Product-Specific Know-How”.  Joint Product-Specific Know-How means all Joint Collaboration Know-How that solely relates to the Product(s) and does not relate, and cannot reasonably be used with, any other product or for any other general purpose.

 

1.63.        “Joint Product-Specific Patent Rights”.  Joint Product-Specific Patent Rights means all Patent Rights throughout the world covering Joint Product-Specific Know-How.

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

11

 

1.64.        “Know-How”.  Know-How means any information and material that is confidential and proprietary, including, without limitation, ideas, concepts, discoveries, inventions, developments, improvements, know-how, trade secrets, designs, devices, equipment, process conditions, algorithms, notation systems, works of authorship, computer programs, technologies, formulas, techniques, methods, procedures, assay systems, applications, data, documentation, reports, sugars, polysaccharides, heparinases, enzymes, reagents, glycoproteins, proteins, peptides, glycoconjugates, primers, plasmids, vectors, expression systems, cells, cell lines, antibodies, organisms, chemical compounds, products, specifications and formulations, whether patentable or otherwise.  Know-How shall also include non-confidential information and material to the extent such information and material first lost its confidentiality by virtue of its disclosure in an issued patent or published patent application, a filing with a Regulatory Authority or as part of a legal proceeding.

 

1.65.        “Label”.  Label means, with respect to a Product, any package labeling designed for use with such Product, pursuant to the terms of this Agreement, in accordance with cGMP, including the package insert for such Product, that is approved by the relevant Regulatory Authority pursuant to the terms of this Agreement; and any variation of such term, such as “Labeled” or “Labeling”, means the act of doing the foregoing, and “Labeler” means a Party or Third Party who performs the act of Labeling.

 

1.66.        “Launch”.  Launch means, with respect to a Product in a country in the relevant Territory, the date when Sandoz, its Affiliates or distributors achieve the First Commercial Sale of such Product in such country.

 

1.67.        “Legal Activities”.  Legal Activities means (a) all Product-Specific Patent Activities, and (b) all activities with respect to Legal Clearance.

 

1.68.        “Legal Clearance”.  Legal Clearance means, with respect to a Product in a country in the relevant Territory, Final ROW Legal Clearance or Final U.S. Legal Clearance, as applicable, including all Patent Litigation activities necessary or beneficial to achieve such Final ROW Legal Clearance or Final U.S. Legal Clearance, as applicable.

 

1.69.        “Legal Clearance Costs”.  Legal Clearance Costs means, with respect to a Product, all legal fees and expenses incurred to achieve Legal Clearance with respect to such Product, or otherwise to achieve Marketing Approval of any Product, excluding (a) Settlement Costs with respect thereto, and (b) amounts relating to achieving legal clearance for the Lovenox-Referenced Product in the U.S. Territory.

 

1.70.        “Legal Costs”.  Legal Costs means, with respect to a Product, any Liabilities paid or incurred by either Party with respect to Third Party claims against any Sandoz Indemnified Party or Momenta Indemnified Party, of the type described in Section 12.1(c), (d) or (e) (regardless of whether such claim has been made against or naming any Momenta Indemnified Party) with respect to such Product, including Settlement Costs, but expressly excluding all Legal Clearance Costs.

 

1.71.        “Legal Expenses”.  Legal Expenses means, with respect to a Product in the relevant Territory:  (a) Legal Clearance Costs; (b) Legal Costs; and (c) Momenta’s FTE Costs

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

12

 

with respect to Legal Activities for the Glycoprotein Products, which costs are incurred in accordance with the relevant Annual Collaboration Plan; but (d) not including Momenta’s FTE Costs with respect to the Legal Activities for the Collaboration Products.  Notwithstanding the foregoing, Legal Expenses hereunder excludes such amounts relating to the Lovenox-Referenced Product in the U.S. Territory.

 

1.72.        “Lovenox-Equivalent Product”.  Lovenox-Equivalent Product means (a)    Lovenox® in injectable form sold as a brand, including Lovenox® sold by Sanofi-Aventis using Clexane®, Klexane® or another tradename (collectively, “Branded Clexane”), or (b) any injectable product sold in the European Territory (other than Branded Clexane) that is a generic A-rated therapeutically equivalent, or the EU equivalent thereof, to Lovenox®, Clexane® or Klexane® in injectable form.  For the avoidance of doubt, Lovenox-Equivalent Product excludes any new chemical entities.

 

1.73.        “Lovenox-Referenced Product”.  Lovenox-Referenced Product means injectable (syringe and vial) enoxaparin for which the reference listed drug is listed in US New Drug Application No. 020164, for which an Application could be approved by the relevant Regulatory Authority.  For the avoidance of doubt, Lovenox-Referenced Product excludes any new chemical entities.

 

1.74.        “Marketing Approval”.  Marketing Approval means, with respect to a Product in a country or region, the approval of the relevant Regulatory Authority necessary and sufficient for the marketing and First Commercial Sale of such Product in such country or region.

 

1.75.        “MIT”.  MIT means Massachusetts Institute of Technology.

 

1.76.        “MIT Agreement”.  MIT Agreement means the Amended and Restated Exclusive Patent License Agreement by and between MIT and Momenta, dated as of November 1, 2002, and as amended by a First Amendment dated November 15, 2002, letter agreements dated September 12, 2003 and October 22, 2003, a Second Amendment dated November 19, 2003, a Third Amendment dated April 2, 2004, a Fourth Amendment with an effective date of July 17, 2004, a Fifth Amendment dated August 5, 2006, a Sixth Amendment dated January 10, 2007 and letter agreements dated August 10, 2006 and October 18, 2006, as the same may be amended from time to time.

 

1.77.        “Momenta Collaboration Know-How”.  Momenta Collaboration Know-How means (a) all Know-How (other than works of authorship) which is conceived, or, solely with respect to works of authorship, authored, solely by the employees, contractors (subject to Section 8.3), consultants or agents of Momenta or its Affiliates during, and in the conduct of, the Collaborative Program, excluding Improvements to Sandoz Know-How or Improvements to Sandoz Collaboration Know-How, and (b) (i) Improvements to Momenta Know-How or (ii) Improvements to Momenta Collaboration Know-How, which, with respect to each of (b)(i) and (b)(ii), are made solely by the employees, contractors, consultants or agents of Sandoz or its Affiliates, or jointly by the employees, contractors, consultants or agents of Sandoz or its Affiliates, on the one hand, and by the employees, contractors, consultants or agents of Momenta or its Affiliates, on the other hand, during, and in the conduct of, the Collaborative Program.

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

13

 

1.78.        “Momenta Collaboration Patent Rights”.  Momenta Collaboration Patent Rights means all Patent Rights throughout the world covering Momenta Collaboration Know-How, which Patent Rights are Controlled by Momenta.

 

1.79.        “Momenta Indemnified Parties”.  Momenta Indemnified Parties means Momenta, Momenta’s Affiliates, any of their successors or assigns, and any of their respective then-current or then-former directors, officers, employees, consultants, agents, suppliers, contract manufacturers, contract service providers, Third Parties engaged to perform activities under the Collaborative Program, MIT (including MIT’s trustees, officers, faculty, students, employees, and agents) and [**] (including [**] Affiliates, and [**] and its Affiliates’ respective directors, officers, employees and agents); provided, however, that with respect to [**], such indemnification shall be subject to any provision regarding indemnification in any side letters that have been or are executed in the future between Momenta, on the one hand, and Sandoz or any of its Affiliates, on the other hand.

 

1.80.        “Momenta IP”.  Momenta IP means Momenta Know-How, Momenta Collaboration Know-How, Momenta Patent Rights and Momenta Collaboration Patent Rights, including, without limitation, those license rights granted to Momenta under the MIT Agreement to the extent such would be included in Momenta Know-How, Momenta Collaboration Know-How, Momenta Patent Rights and Momenta Collaboration Patent Rights.  Momenta IP, and its incorporated terms, do not include Momenta’s rights in Joint Collaboration IP.

 

1.81.        “Momenta Know-How”.  Momenta Know-How means all Know-How which (a) is Controlled by Momenta (i) as of the Effective Date or (ii) during the term of the Collaborative Program, but which is not developed or acquired by Momenta or any of its Affiliates in the conduct of the Collaborative Program, and (b) is reasonably necessary or reasonably useful for the conduct of the Collaborative Program.

 

1.82.        “Momenta Patent Rights”.  Momenta Patent Rights means all Patent Rights throughout the world that (a) cover Momenta Know-How, (b) are Controlled by Momenta, and (c) are reasonably necessary or reasonably useful for the conduct of the Collaborative Program; including, without limitation, the Patent Rights listed on Schedule 1.82.

 

1.83.        “Momenta Product-Specific Know-How”.  Momenta Product-Specific Know-How means all Momenta Know-How or Momenta Collaboration Know-How that solely relates to the Product(s) and does not relate to, and cannot reasonably be used with, any other product or for any other general purpose.

 

1.84.        “Momenta Product-Specific Patent Rights”.  Momenta Product-Specific Patent Rights means all Patent Rights throughout the world covering Momenta Product-Specific Know-How, which Patent Rights are Controlled by Momenta.

 

1.85.        “Momenta Profit Percentage”.  Momenta Profit Percentage means (a) with respect to the Copaxone-Referenced Product, fifty percent (50%); (b) with respect to the Lovenox-Referenced Product, [**] percent ([**]%); (c) with respect to the [**]-Referenced Product, [**]percent ([**]%); and (d) with respect to the [**]-Referenced Product, [**] percent ([**]%).

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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1.86.        “Momenta Third Party Royalty Obligations”.  Momenta Third Party Royalty Obligations means the Third Party royalty obligations for which Momenta shall be responsible, pursuant to Sections 4.1.5(a) and (b).

 

1.87.        “MOU”.  MOU means the Memorandum of Understanding entered into by the Parties on July 25, 2006.

 

1.88.        “MOU Effective Date”.  MOU Effective Date means July 25, 2006.

 

1.89.        “Net Sales”.  Net Sales means, with respect to a Product, the gross amount invoiced by Sandoz or its Affiliates or sublicensees to Third Parties (whether an end-user, a distributor or otherwise) for sales of such Product, less deductions from the gross invoiced sales price for such Product directly paid or incurred by Sandoz, its Affiliates or sublicensees with respect to the sale of such Product, calculated pursuant to Novartis principal accounting policies (as detailed in Schedule 1.89), and determined from the books and records of Sandoz, its Affiliates or sublicensees maintained in accordance with GAAP or IFRS, consistently applied.

 

Sandoz, through its relevant Affiliates, retains the right to modify the Novartis principal accounting policies to comply with specific changes in GAAP or IFRS.  The revised calculation of Net Sales resulting from such modifications is subject to the consent of Momenta, such consent not to be unreasonably withheld.

 

In the case of any sale of a Product for consideration other than cash, such as barter or countertrade, Net Sales shall be calculated on the fair value of consideration received.

 

Sandoz agrees, on behalf of itself and its Affiliates and sublicensees, not to use any Product as a loss leader.  Sandoz also agrees that if it or its Affiliate or sublicensee prices a Product in order to gain or maintain sales of other products, then for purposes of calculating the payments due hereunder, the Net Sales shall be adjusted for any discount which was given to a customer that was in excess of customary discounts for such Product (or, in the absence of relevant data for such Product, other similar products under similar market conditions) by reversing such excess discount, if such discount was given in order to gain or maintain sales of other products.

 

In the case of any sale of a Product between or among Sandoz or its Affiliates or sublicensees for resale, Net Sales shall be calculated as above only on the value charged or invoiced on the first arm’s length sale thereafter to a Third Party other than a sublicensee.

 

Notwithstanding the foregoing, Net Sales hereunder excludes such amounts relating to the Lovenox-Referenced Product in the U.S. Territory.

 

1.90.        “Non-Owning Party”.  Non-Owning Party means, with respect to Sandoz IP, Momenta, and, with respect to Momenta IP, Sandoz.

 

1.91.        “Non-Substitutable Product”.  Non-Substitutable Product means a product (a) with (i) [**], (ii) [**], and (iii) [**], and (b) for which an Application cites the relevant Reference Drug as the reference listed drug.

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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1.92.        “[**]”.  [**] means (a) [**] (b) its Affiliates, (c) any Person that is a licensed distributor of [**] or their respective Affiliates for an [**]-Equivalent Product (the Persons described in Sections 1.92(a), (b) and (c), collectively, the “[**] Persons”), and (d) the successors and assigns of any [**] Persons with respect to any rights to any [**]-Equivalent Product.

 

1.93.        “[**]”.  [**] means (a) [**] (b) its Affiliates, (c) any Person that is a licensed distributor of [**] or its Affiliates for an [**]-Equivalent Product (the Persons described in Sections 1.93(a), (b) and (c), collectively, the “[**] Persons”), and (d) the successors and assigns of any [**] Persons with respect to any rights to any [**]-Equivalent Product.

 

1.94.        “Owning Party”.  Owning Party means, with respect to Momenta IP, Momenta, and, with respect to Sandoz IP, Sandoz.

 

1.95.        “Owning Party’s IP”.  Owning Party’s IP means, with respect to Momenta, the Momenta IP, and, with respect to Sandoz, Sandoz IP.

 

1.96.        “Paragraph IV Certifications”.  Paragraph IV Certifications means certifications pursuant to 21 U.S.C. 355(b)(2)(A)(iv) or 355(j)(2)(A)(vii)(IV).

 

1.97.        “[**]”.  [**] means [**].

 

1.98.        “Party”.  Party means Sandoz or Momenta; “Parties” means Sandoz and Momenta.

 

1.99.        “Patent Litigation”.  Patent Litigation means, with respect to a Product, (a) a claim or demand by the relevant Innovator or other Third Party that alleges patent infringement against any Momenta Indemnified Party or any Sandoz Indemnified Party based on (i) the activities of Sandoz or Momenta (including those undertaken by Affiliates or Third Parties on behalf of them) pursuant to this Agreement related to such Product (including the manufacture of such Product), or (ii) the activities of Sandoz or Momenta (including those undertaken by Affiliates or Third Parties on behalf of them) prior to the Effective Date related to such Product (including the manufacture of such Product), or (b) a declaratory judgment or other legal or equitable proceeding approved by the JSC (or if the JSC cannot reach agreement, through the provisions of Article 13) and commenced or joined by Momenta, Sandoz or one of their Affiliates that seeks a judgment against the relevant Innovator or other Third Party that (i) Sandoz, Momenta, their Affiliates and/or their permitted licensees hereunder have not infringed, or will not infringe, any patent related to such Product (including the manufacture of such Product) and/or (ii) that the relevant Patent Rights of such Innovator or other Third Party are invalid or unenforceable; in each case, irrespective of the nature of the relief sought (which may include, without limitation, actual, consequential or enhanced damages) and irrespective of the jurisdiction in which such claim, demand or action is brought.

 

1.100.      “Patent Right”.  Patent Right means a United States and/or foreign patent or patent application and all substitutions, divisionals, continuations, continuations-in-part, confirmations, registrations, reissues, reexaminations, renewals and extensions (including supplemental protection certificates) thereof.

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

16

 

1.101.      “Person”.  Person means any natural person, corporation, firm, business trust, joint venture, association, organization, company, partnership or other business entity, or any government, or any agency or political subdivision thereof.

 

1.102.      “Pre Final Legal Clearance Launch”.  Pre Final Legal Clearance Launch means, with respect to a Product in a country in the relevant Territory, the occurrence of the Launch of such Product in such country prior to Final ROW Legal Clearance or Final U.S. Legal Clearance, as applicable.

 

1.103.      “Prior Confidentiality Agreements”.  Prior Confidentiality Agreements means, collectively, (a) a Confidentiality Agreement between Momenta and Sandoz Inc. (formerly Geneva Pharmaceuticals, Inc.), an Affiliate of Sandoz, effective as of June 17, 2003, as amended by Amendment One effective as of January 5, 2006 (the “Geneva CDA”), and (b) a Confidentiality Agreement between Momenta and Biochemie GmbH, an Affiliate of Sandoz, made as of the 16th day of April, 2003 (the “Biochemie CDA”).

 

1.104.      “Prior Obligations”.  Prior Obligations means, collectively, with respect to a Party, (a) any contractual obligations of such Party as of the Effective Date (or thereafter if otherwise agreed by the Parties) to, or restrictions existing as of the Effective Date (or thereafter if otherwise agreed by the Parties) imposed by, such Party’s Third Party Licensors, and (b) the limitations imposed by the Existing US Lovenox Agreement.

 

1.105.      “Product”.  Product means each of the following:  the Copaxone-Referenced Product, the Lovenox-Referenced Product, the [**]-Referenced Product and the [**]-Referenced Product.  Each Product may be in any formulation, combination or injectable presentation.

 

1.106.      “Product-Specific Patent Activities”.  Product-Specific Patent Activities means all activities of the Parties with respect to the preparation, filing, prosecution, maintenance, enforcement and invalidity defense of Product-Specific Patent Rights.

 

1.107.      “Product-Specific Patent Costs”.  Product-Specific Patent Costs means, with respect to a Product, all costs paid by a Party to Third Parties with respect to the Product-Specific Patent Activities with respect to such Product.

 

1.108.      “Product-Specific Patent Rights”.  Product-Specific Patent Rights means Sandoz Product-Specific Patent Rights, Momenta Product-Specific Patent Rights and Joint Product-Specific Patent Rights.

 

1.109.      “Profits”.  Profits means, with respect to a Quarter during which Sandoz, its Affiliates or distributors is selling a Product in a country(ies) in the relevant Territory, Net Sales for such Product less (a) Selling Expenses for such Product, (b) Cost of Goods Sold for the units of such Product sold (regardless of whether such Product is rejected, returned or recalled), and (c) (i) solely with respect to a Copaxone-Referenced Product, any milestone paid in such Quarter pursuant to Section 4.2.1(c) with respect to such Product, and (ii) solely with respect to a Lovenox-Referenced Product, any milestone paid in such Quarter pursuant to Section 4.2.2(b) with respect to such Product.  Notwithstanding the foregoing, Profits hereunder excludes (i) such amounts relating to the Lovenox-Referenced Product in the U.S. Territory and (ii) Sublicense Income.

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

17

 

1.110.      “Quarter”.  Quarter means each three-month period ending March 31, June 30, September 30 and December 31 in each calendar year.

 

1.111.      “Reference Drug”.  Reference Drug means (a) with respect to the Copaxone-Referenced Product, Branded Copaxone, (b) with respect to the Lovenox-Referenced Product, Branded Clexane, (c) with respect to the [**]-Referenced Product, Branded [**], and (d) with respect to the [**]-Referenced Product, Branded [**].

 

1.112.      “Reference-Equivalent Product”.  Reference-Equivalent Product means a Copaxone-Equivalent Product or a Lovenox-Equivalent Product.

 

1.113.      “Region”.  Region means, with respect to a Collaboration Product, each of the following within the relevant Territory:  (a) the U.S. Territory, (b) the European Territory, and (c) each country separately in the rest of the world.

 

1.114.      “Regulatory Authority”.  Regulatory Authority means any federal, national, multinational, state, provincial or local regulatory agency, department, bureau or other governmental entity with authority over the testing, manufacture, use, storage, import, promotion, marketing and sale of a therapeutic product in a country, including the FDA, the EMEA and the European Commission.

 

1.115.      “Related Product”.  Related Product means, with respect to a Glycoprotein Product, an injectable product (a) with (i) [**], (ii) [**], and (iii) [**], and (b) for which an Application cites the marketing approval file for the relevant Reference Drug or, with respect to the [**]-Referenced Product, [**]as the reference listed drug.

 

1.116.      “Research Institution”.  Research Institution means an academic, non-profit research institution or hospital that conducts research or development activities on behalf of or in collaboration with a Party with respect to a Sandoz MFN Project and to which such Party does not grant any commercialization rights with respect to any Sandoz MFN Project.

 

1.117.      “Sandoz Collaboration Know-How”.  Sandoz Collaboration Know-How means (a) all Know-How (other than works of authorship) which is conceived, or, solely with respect to works of authorship, authored, solely by the employees, contractors (subject to Section 8.3), consultants or agents of Sandoz or its Affiliates during, and in the conduct of, the Collaborative Program, excluding Improvements to Momenta Know-How or Improvements to Momenta Collaboration Know-How, and (b) (i) Improvements to Sandoz Know-How or (ii) Improvements to Sandoz Collaboration Know-How, which, with respect to each of (b)(i) and (b)(ii), are made solely by the employees, contractors, consultants or agents of Momenta or its Affiliates, or jointly by the employees, contractors, consultants or agents of Sandoz or its Affiliates, on the one hand, and by the employees, contractors, consultants or agents of Momenta or its Affiliates, on the other hand, during, and in the conduct of, the Collaborative Program.

 

1.118.      “Sandoz Collaboration Patent Rights”.  Sandoz Collaboration Patent Rights means all Patent Rights throughout the world covering Sandoz Collaboration Know-How, which Patent Rights are Controlled by Sandoz.

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

18

 

1.119.      “Sandoz Indemnified Parties”.  Sandoz Indemnified Parties means Sandoz, its Affiliates, any of their successors or assigns, and any of their respective then-current or then-former directors, officers, employees, consultants, suppliers, contract manufacturers, contract service providers, and Third Parties engaged to perform activities under the Collaborative Program.

 

1.120.      “Sandoz IP”.  Sandoz IP means Sandoz Know-How, Sandoz Collaboration Know-How, Sandoz Patent Rights and Sandoz Collaboration Patent Rights.  Sandoz IP, and its incorporated terms, do not include Sandoz’s rights in Joint Collaboration IP.

 

1.121.      “Sandoz Know-How”.  Sandoz Know-How means all Know-How which (a) is Controlled by Sandoz (i) as of the Effective Date or (ii) during the term of the Collaborative Program, but which is not developed or acquired by Sandoz or any of its Affiliates in the conduct of the Collaborative Program, and (b) is reasonably necessary or reasonably useful for the conduct of the Collaborative Program.

 

1.122.      “Sandoz Material”.  Sandoz Material means any protein product or cell line for which Sandoz or its Affiliates gives access to Momenta in order to jointly collaborate with Sandoz pursuant to Section 5.1, whether or not such protein product or cell line is owned by Sandoz or its Affiliates.

 

1.123.      “Sandoz MFN Project”.  Sandoz MFN Project means each of the following:  (a) the [**]-Referenced Product for development and/or commercialization outside the U.S. Territory, (b) the [**]-Referenced Product for development and/or commercialization outside the European Territory, and (c) any product for which an Application citing [**] as the reference listed drug could be approved, for development and/or commercialization worldwide.

 

1.124.      “Sandoz Patent Rights”.  Sandoz Patent Rights means all Patent Rights throughout the world that (a) cover Sandoz Know-How, (b) are Controlled by Sandoz, and (c) are reasonably necessary or reasonably useful for the conduct of the Collaborative Program; including, without limitation, the Patent Rights listed on Schedule 1.124.

 

1.125.      “Sandoz Product-Specific Know-How”.  Sandoz Product-Specific Know-How means all Sandoz Know-How or Sandoz Collaboration Know-How that solely relates to a Product(s) and does not relate to, and cannot reasonably be used with, any other product or for any other general purpose.

 

1.126.      “Sandoz Product-Specific Patent Rights”.  Sandoz Product-Specific Patent Rights means all Patent Rights throughout the world covering Sandoz Product-Specific Know-How, which Patent Rights are Controlled by Sandoz.

 

1.127.      “Sanofi-Aventis”.  Sanofi-Aventis means (a) Sanofi-Aventis, a company organized and existing under the laws of the Republic of France, (b) its Affiliates, (c) any Person who is a licensed distributor of Sanofi-Aventis or its Affiliates for a Lovenox-Equivalent Product (the Persons described in Sections 1.127(a), (b) and (c), collectively, the “Sanofi-Aventis Persons”), and (d) the successors and assigns of any Sanofi-Aventis Persons with respect to any rights to any Lovenox-Equivalent Product.

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

19

 

1.128.      “Selling Expenses”.  Selling Expenses means, with respect to a Product, Sandoz’s or its Affiliates’ expenditures to market, distribute and sell such Product, which shall be deemed for purposes of this Agreement to be equal to the following percentage of Net Sales of the relevant Product for each applicable period:  (a) with respect to the Copaxone-Referenced Product, [**] percent ([**]%); (b) with respect to the Lovenox-Referenced Product, [**] percent ([**]%); (c) with respect to the [**]-Referenced Product, [**] percent ([**]%); and (d) with respect to the [**]-Referenced Product, [**] percent ([**]%).

 

1.129.      “[**]”.  [**] means (a) [**] (b) its Affiliates, (c) any Person who is a licensed distributor of [**] or its Affiliates for an [**]-Equivalent Product (the Persons described in Sections 1.129(a), (b) and (c), collectively, the “[**] Persons”), and (d) the successors and assigns of any [**] Persons with respect to any rights to any [**]-Equivalent Product.

 

1.130.      “Settlement”.  Settlement means, with respect to a Product, an agreement or settlement, made at any time, between Sandoz or its Affiliate(s), on the one hand, and the relevant Innovator or other Third Party, on the other hand, that finally resolves any existing Patent Litigation and precludes any future Patent Litigation by such Innovator or other Third Party against Sandoz, their respective Affiliates and sublicensees approved by the Parties and the Momenta Indemnified Parties related to such Product, such that such Product may be marketed by or continue to be marketed by or on behalf of Sandoz or its Affiliates, or sublicensees approved by the Parties, subject to Application Final Approval for such Product.

 

1.131.      “Settlement Costs”.  Settlement Costs means, with respect to a Product, all amounts paid to the relevant Innovator or other Third Party (whether in a lump sum or on-going royalty or similar arrangement, including without limitation for lost profits) in order to achieve a Settlement with respect to such Product.  Notwithstanding the foregoing, Settlement Costs hereunder excludes settlement amounts relating to the Lovenox-Referenced Product in the U.S. Territory under the Existing US Lovenox Agreement.

 

1.132.      “Stock Purchase Agreement”.  Stock Purchase Agreement means the Stock Purchase Agreement entered into by Momenta and Novartis Pharma AG on July 25, 2006.

 

1.133.      “Sublicense Income”.  Sublicense Income means all consideration received by a Party or its Affiliates with respect to rights granted to a Third Party(ies) to Develop or Commercialize a Product(s) for sale in the relevant Territory, but excluding:  (a) consideration received by such Party or its Affiliates as payments for actual direct costs for performing Development or Commercialization activities undertaken by such Party or its Affiliates for, or in collaboration with, such Third Party(ies) or their Affiliates; (b) consideration received by such Party and/or its Affiliates from such Third Party(ies) or their Affiliates as the purchase price for such Party’s or any of its Affiliates’ debt or equity securities, except that consideration that exceeds the fair market value of such debt or equity securities shall not be so excluded; and (c) consideration paid by such Third Party(ies) to such Party or its Affiliates to purchase such Product(s) (provided, however, that any consideration greater than the applicable Cost of Goods Sold shall not be so excluded).  Notwithstanding the foregoing, Sublicense Income hereunder excludes amounts relating to rights granted to a Third Party(-ies) with respect to the Lovenox-Referenced Product in the U.S. Territory.

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

20

 

 

1.134.      “Territory”.  Territory means (a) with respect to the Copaxone-Referenced Product, worldwide; (b) with respect to the Lovenox-Referenced Product, the European Territory; (c) with respect to the [**]-Referenced Product, the U.S. Territory; and (d) with respect to the [**]-Referenced Product, the European Territory; provided, however, that with respect to the Copaxone-Referenced Product, Territory shall exclude the [**] if Sandoz has chosen to develop or commercialize the Copaxone-Referenced Product independently of Momenta therein in accordance with Section 5.3.

 

1.135.      “Teva”.  Teva means (a) Teva Pharmaceutical Industries, Ltd., (b) its Affiliates, (c) any Person who is a licensed distributor of Teva Pharmaceutical Industries, Ltd. or its Affiliates for a Copaxone-Equivalent Product (the Persons described in Sections 1.135(a), (b) and (c), collectively, the “Teva Persons”), and (d) the successors and assigns of any Teva Persons with respect to any rights to any Copaxone-Equivalent Product.

 

1.136.      “Third Party”.  Third Party means any Person other than a Party or any of its Affiliates.

 

1.137.      “Third Party Royalties”.  Third Party Royalties means, with respect to a Product in a country in the relevant Territory, any royalties, license fees, maintenance fees or other monetary payments made by Sandoz or its Affiliates (either directly or via reimbursement to Momenta) or Momenta or its Affiliates to any Third Party in consideration of a license(s) under such Third Party patent(s), know-how or other intellectual property rights, when such license is determined by the JSC to be necessary to develop, commercially manufacture and/or sell such Product without infringing such Third Party intellectual property rights; provided, however, that Third Party Royalties shall not include (a) the Momenta Third Party Royalty Obligations, or (b) any amounts paid to a Third Party(-ies) with respect to the development or commercialization of the Lovenox-Referenced Product for sale in the U.S. Territory.

 

1.138.      “[**]”.  [**] means [**].

 

1.139.      “U.S. Territory”.  U.S. Territory means the fifty states of the United States of America, the District of Columbia and all commonwealths, territories and possessions of the United States of America and any other location where the FDA has jurisdiction over medicinal products intended for human use.

 

1.140.      Other Defined Terms.  Each of the following definitions is set forth in the section of this Agreement indicated below:

 

	
Definition
    	
 
    	
Section
    
	
Agreement
    	
 
    	
Preamble
    
	
[**] Persons
    	
 
    	
1.2
    
	
AM or Alliance Manager
    	
 
    	
5.5
    
	
Biochemie CDA
    	
 
    	
1.103
    
	
Branded Clexane
    	
 
    	
1.72
    
	
Branded Collaboration Product
    	
 
    	
6.1
    
	
Branded Copaxone
    	
 
    	
1.26
    
	
Branded [**]
    	
 
    	
1.32
    

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

21

 

	
Definition
    	
 
    	
Section
    
	
Branded [**]
    	
 
    	
1.44
    
	
Cost
    	
 
    	
1.28
    
	
Disclosing Party
    	
 
    	
10.2
    
	
Effective Date
    	
 
    	
Preamble
    
	
Enforcing Party
    	
 
    	
8.4.2
    
	
FD&C Act
    	
 
    	
1.4
    
	
Final Misappropriation Determination
    	
 
    	
12.3
    
	
Force Majeure Event
    	
 
    	
14.16
    
	
Geneva CDA
    	
 
    	
1.103
    
	
Indemnified Party
    	
 
    	
12.4
    
	
Indemnifying Party
    	
 
    	
12.4
    
	
Invalidity Claim
    	
 
    	
8.6
    
	
JOC
    	
 
    	
5.6
    
	
JPT
    	
 
    	
5.4
    
	
JPTL
    	
 
    	
5.4
    
	
JSC
    	
 
    	
5.8
    
	
Legal /Intellectual Property Team
    	
 
    	
5.7
    
	
Liabilities
    	
 
    	
12.1
    
	
LPL
    	
 
    	
5.4
    
	
MIT Associates
    	
 
    	
14.17
    
	
Momenta
    	
 
    	
Preamble
    
	
Momenta Assigned Improvements
    	
 
    	
8.1.1
    
	
Non-Substitutable [**] Launch
    	
 
    	
4.2.3
    
	
Non-Substitutable [**] Launch
    	
 
    	
4.2.4
    
	
NPC
    	
 
    	
Schedule 1.89
    
	
Orange Book
    	
 
    	
1.42
    
	
Orange Book Patent Rights
    	
 
    	
1.42
    
	
[**] Persons
    	
 
    	
1.92
    
	
[**] Persons
    	
 
    	
1.93
    
	
Payables Records
    	
 
    	
4.4.5
    
	
Pleadings
    	
 
    	
12.4.3
    
	
Prosecuting Party
    	
 
    	
8.2.3
    
	
Profit Interest
    	
 
    	
4.3
    
	
Receiving Party
    	
 
    	
10.2
    
	
Regulatory and Policy Strategy Team
    	
 
    	
7.6
    
	
Representing Party
    	
 
    	
9.1
    
	
Sandoz
    	
 
    	
Preamble
    
	
Sandoz Assigned Improvements
    	
 
    	
8.1.1
    
	
Sanofi-Aventis Persons
    	
 
    	
1.127
    
	
[**] Persons
    	
 
    	
1.129
    
	
Slightly Late [**] Substitutability Receipt
    	
 
    	
4.2.3
    
	
Term
    	
 
    	
11.1
    
	
Teva Persons
    	
 
    	
1.135
    

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

22

 

	
Definition
    	
 
    	
Section
    
	
Third Party Licensor
    	
 
    	
2.5
    
	
Transaction
    	
 
    	
1.9
    

 

2.       GRANT OF RIGHTS

 

2.1.          Momenta License Grants.

 

2.1.1.       Subject to the terms and conditions of this Agreement, Momenta hereby grants to Sandozand its Full Affiliates during the Term, (a) an exclusive license, without the right to grant sublicenses, under Momenta IP and under Momenta’s rights in the Joint Collaboration IP, to Develop, make, have made, use, sell, offer to sell, lease, import, export or otherwise Commercialize the Products in the relevant Territory in the Field and (b) a non-exclusive license, without the right to grant sublicenses, under Momenta IP and under Momenta’s rights in the Joint Collaboration IP to make, have made and use each Product outside the relevant Territory, but only for the purposes of sale of such Product in the Field in or into the relevant Territory; provided, however, that Momenta retains the right to practice, and to grant licenses, under Momenta IP and under Momenta’s rights in the Joint Collaboration IP in the relevant Territory in the Field to (y) perform its obligations under this Agreement, including, without limitation, to conduct the Momenta activities under this Agreement and in the Annual Collaboration Plans, and (z) subject to Sandoz’ rights with respect to the relevant Sandoz MFN Project, make and have made each Product in the relevant Territory solely for the purposes of sales of such Product in the Field outside the relevant Territory.  Notwithstanding anything to the contrary herein, the license granted to Momenta pursuant to Section 2.2 does not grant Momenta the right to exercise such license for purposes of Section 2.1.1(z).  Notwithstanding the foregoing prohibition on sublicensing, subject to the provisions of Sections 8.3.2 and 8.3.3, Sandoz and its Affiliates may sublicense its rights under this Section 2.1.1 only to the extent approved in writing by Momenta.

 

2.1.2.       In no event may Sandoz use or cross-reference any Momenta IP (whether or not included or disclosed in any regulatory filings, whether such filings are owned by Sandoz or otherwise) (a) in [**] if Sandoz has chosen to develop or commercialize the Copaxone-Referenced Product independently of Momenta therein in accordance with Section 5.3; or (b) otherwise with respect to any products or in any countries, other than to support the development and commercialization of the relevant Product in the Field in the relevant Territory pursuant to this Agreement.

 

2.2.          Sandoz License Grants.  Subject to the terms and conditions of this Agreement, Sandoz hereby grants to Momenta and its Full Affiliates during the Term, (a) an exclusive license, without the right to grant sublicenses, under Sandoz IP and under Sandoz’s rights in the Joint Collaboration IP, to Develop, make, have made, use, sell, offer to sell, lease, import, export or otherwise Commercialize the Products in the relevant Territory in the Field and (b) a non-exclusive license, without the right to grant sublicenses, under Sandoz IP and under Sandoz’s rights in the Joint Collaboration IP, to make, have made and use each Product outside the relevant Territory, but only for the purposes of sale of such Product in the Field in or into the relevant Territory; provided, however, that Sandoz retains the right to practice, and to grant

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

23

 

licenses, under Sandoz IP and under Sandoz’s rights in the Joint Collaboration IP in the relevant Territory in the Field to (y) perform its obligations under this Agreement, including, without limitation, to conduct the Sandoz activities under this Agreement and in the Annual Collaboration Plans, and (z) make and have made each Product in the relevant Territory solely for the purposes of sales of such Product in the Field outside the relevant Territory.  Notwithstanding anything to the contrary herein, the license granted to Sandoz pursuant to Section 2.1.1 does not grant Sandoz the right to exercise such license for purposes of Section 2.2(z).  Notwithstanding the foregoing prohibition on sublicensing, subject to the provisions of Sections 8.3.2 and 8.3.3, Momenta and its Affiliates may sublicense its rights under this Section 2.2 only to the extent approved in writing by Sandoz.

 

2.3.          Exclusivity.  Subject to Momenta’s retained rights in Section 2.1 and Sandoz’s retained rights in Section 2.2, except as otherwise agreed in writing by the Parties, Momenta and Sandoz each agree, respectively, that they shall not, and shall ensure that their respective Affiliates do not, during the Term, practice, or grant any license to any Third Party under, Momenta IP, in the case of Momenta, or Sandoz IP, in the case of Sandoz, or Joint Collaboration IP (in the case of either Party), to develop, make, have made, use, sell, offer to sell, lease, import, export or otherwise commercialize (y) any Products in the Field in the relevant Territory or (z) any Sandoz MFN Project (unless (i) pursuant to Article 3 hereunder, Sandoz no longer has rights to such Sandoz MFN Project, (ii) Sandoz has by written notice informed Momenta that it no longer wishes to have rights to such Sandoz MFN Project or (iii) Momenta is otherwise permitted to do so in accordance with Article 3).  Each Party shall not, and shall ensure that its Affiliates do not, develop for sale in the relevant Territory, or commercialize in the relevant Territory, any Products or Related Products (where Territory is the same as for the relevant Product) in the Field during the Term, except pursuant to this Agreement.

 

2.4.          Retained Rights.  Any rights of Momenta not expressly granted to Sandoz under the provisions of this Agreement shall be retained by Momenta and any rights of Sandoz not expressly granted to Momenta under the provisions of this Agreement shall be retained by Sandoz.

 

2.5.          Third Party Licensor Rights.  The rights granted in Sections 2.1 and 2.2 are granted to the extent permitted or qualified by the nature of the licenses granted by the relevant Third Party licensors, if any, of Momenta IP or Sandoz IP, as the case may be (each, a “Third Party Licensor”), (including, with respect to the Momenta IP, the terms of the MIT Agreement) or the licenses granted by Momenta to Sandoz or its Affiliates pursuant to the Existing US Lovenox Agreement and by Sandoz or its Affiliate to Momenta pursuant to the Existing US Lovenox Agreement.  The Party receiving such license shall comply with all restrictions and obligations imposed by such Third Party Licensors or limitations imposed by the license granted by Momenta to Sandoz and its Affiliate pursuant to the Existing US Lovenox Agreement or limitations imposed by the license granted by Sandoz or its Affiliate to Momenta pursuant to the Existing US Lovenox Agreement; provided, however, that, (a) if Momenta or Sandoz, as the case may be, enters into a license after the Effective Date with a Third Party Licensor for any intellectual property that may be considered Momenta IP or Sandoz IP, respectively, Momenta or Sandoz shall notify Sandoz or Momenta, respectively, of the restrictions and obligations imposed by such Third Party Licensor, and, if Sandoz or Momenta, respectively, do not wish to comply with such restrictions and obligations, such licensed intellectual property shall not be considered

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

24

 

Momenta IP or Sandoz IP, respectively, hereunder; (b) if, on or before entering into such license with a Third Party Licensor, Momenta or Sandoz, respectively, determines that such intellectual property is reasonably necessary or reasonably useful for the conduct of the Collaborative Program, then, prior to entering into such license, Momenta or Sandoz, respectively, shall discuss the need for such license, and the terms thereof, with the other Party, reasonably consider such other Party’s input with respect thereto and obtain such other Party’s agreement on the terms of such license which impact or relate to the Collaborative Program (provided, that, unless such other Party objects to such terms within [**] Business Days after receipt of written notice of such terms, such terms are considered agreed upon by such other Party) (but no such agreement is required with respect to any other aspect of such license); provided, that final decision on any such license with a Third Party solely for the Glycoprotein Products shall reside with Sandoz, subject to Section 5.2 and Momenta’s rights not to comply with the restrictions and obligations in the license as described in clause (a) above.  If, after Momenta or Sandoz, respectively, enters into such license with a Third Party Licensor, Momenta or Sandoz, respectively, determines that such intellectual property is reasonably necessary or reasonably useful for the conduct of the Collaborative Program, the Parties shall discuss in good faith the fees, royalties and other payments with respect to such license (which payments shall be allocated between the Parties as described in this Agreement); provided, however, that if such license is also necessary or useful for other products of the licensing Party, the Parties shall discuss in good faith the appropriate allocation of responsibility to each Party for fees, royalties and other payments with respect to such license, based on the relative benefit to the Products.

 

2.6.          Bankruptcy.  All rights and licenses granted under or pursuant to any Section of this Agreement are, and shall otherwise be deemed to be, for purposes of Section 365(n) of the U.S. Bankruptcy Code, licenses of rights to “intellectual property” as defined under Section 101(35A) of the U.S. Bankruptcy Code.  The Parties shall retain and may fully exercise all of their respective rights and elections under the U.S. Bankruptcy Code.  Upon the bankruptcy of a Party, the non-bankrupt Party shall further be entitled to a complete duplicate of (or complete access to, as appropriate) any such intellectual property, and such, if not already in its possession, shall be promptly delivered to the non-bankrupt Party, unless the bankrupt Party elects to continue, and continues, to perform all of its obligations under this Agreement.

 

3.        SANDOZ MFN PROJECTS

 

3.1.          Sandoz MFN Project Rights.

 

3.1.1.       At any time before the [**] anniversary of the MOU Effective Date, either Party may trigger the [**] day negotiation period described in this Section 3.1.1 for any Sandoz MFN Project upon written notice to the other Party, which notice shall include, at a minimum, a written financial proposal with respect to such Sandoz MFN Project, which proposal shall include, as appropriate, the amount of up-front payments, the amount and timing of subsequent license or research payments, the royalty rate(s) or profit sharing terms, the definition of territory, marketing and promotion rights, and the purchase and pricing of equity, if applicable.  The Parties shall negotiate in good faith, for [**] days after receipt of such notice, a definitive collaboration agreement, including territory, project plan and financial terms.  If Sandoz initiated such negotiation by providing Momenta with a financial proposal, Momenta shall, during such [**] day period, provide

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

25

 

Sandoz with a financial counter-proposal with respect to such Sandoz MFN Project.  Prior to and during such [**] day period, each Party is allowed to discuss and negotiate with Third Party(ies) regarding a collaboration with respect to such Sandoz MFN Project, but shall not enter into a definitive agreement with any Third Party with respect to such Sandoz MFN Project.

 

3.1.2.       If the Parties do not sign a definitive agreement with respect to any such Sandoz MFN Project within such [**] day negotiation period despite Sandoz having received a written financial proposal or, if Sandoz had provided the initial financial proposal, Sandoz having received a written counter-proposal within a reasonable time, and the Parties having negotiated in good faith, Momenta shall be free, for a period of [**] thereafter, to execute a definitive agreement with a Third Party with respect to such Sandoz MFN Project, which shall be on terms not less favorable, taken as a whole, to Momenta than those last offered by Momenta to Sandoz.  The Parties recognize that, in evaluating the favorability to Momenta of the terms of such Third Party transaction relating to such Sandoz MFN Project, numerous factors may be taken into account and given appropriate weight, including, without limitation, the amount of up-front payments, the amount and timing of subsequent license or research payments, the royalty rate(s) or profit sharing terms, the definition of territory, marketing and promotion rights, and the purchase and pricing of equity, if applicable.  If after the expiration of such [**] period, Momenta has not entered into a transaction with any Third Party with respect to such Sandoz MFN Project, then the Parties shall again negotiate for [**] days with respect to such Sandoz MFN Project and if the Parties do not execute a definitive agreement during such [**] day period, the provisions of this Section 3.1.2 shall again apply.  Momenta shall not be obligated to reveal to Sandoz the identity of any Third Party involved in any such transaction.

 

3.2.          Freedom.  Subject to the restrictions in Section 2.3 and this Article 3, neither Party shall be restricted from undertaking, alone or with its Affiliates or any Third Party, any activities, including without limitation entering into any contracts, with respect to any compounds, biologics or products other than the Products and, to the extent provided in this Article 3, the Sandoz MFN Projects.  Notwithstanding anything to the contrary in this Article 3, neither Party shall be restricted from entering into any agreement with Controlled Contractors or Research Institutions with respect to any Sandoz MFN Projects.  Unless mutually agreed by the Parties, the provisions of Section 3.1 shall automatically terminate upon the [**] anniversary of the MOU Effective Date.

 

4.        FINANCIAL PAYMENTS

 

4.1.          Costs.

 

4.1.1.       Development Costs.  Subject to the provisions of this Agreement,

 

4.1.1.a.        with respect to the Copaxone-Referenced Product, (i) except as provided in Sections 4.1.1(a)(ii) and (iii), Momenta shall be responsible for all Development Costs incurred under this Agreement with respect to Development activities required to seek Marketing Approval for the Copaxone-

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

26

 

Referenced Product in the U.S. Territory; (ii) each Party shall bear fifty percent (50%) of all Development Costs incurred under this Agreement with respect to Development activities required to seek Marketing Approval for the Copaxone-Referenced Product in any country in the relevant Territory outside the U.S. Territory, which activities are not required to seek Marketing Approval for such Product in the U.S. Territory; provided, however, that the JSC shall jointly decide whether to Develop for, apply for Marketing Approval for, and/or Commercialize, the Copaxone-Referenced Product in any countries in the Territory outside the U.S. Territory and the European Territory (subject to Section 5.3 with respect to [**]); and (iii) the Parties shall each bear fifty percent (50%) of the costs of clinical studies (beyond bioequivalency studies) required to seek or achieve Marketing Approval of the Copaxone-Referenced Product in any country in the relevant Territory, subject to Section 11.3;

 

4.1.1.b.       with respect to the Lovenox-Referenced Product, (i) except as provided in Section 4.1.1(b)(ii), Momenta shall bear [**] percent ([**]%) and Sandoz shall bear [**] percent ([**]%) of all Development Costs incurred under this Agreement by either Party with respect to Development activities required to seek Marketing Approval for the Lovenox-Referenced Product in any country in the European Territory; and (ii) Momenta shall bear [**] percent ([**]%) and Sandoz shall bear [**] percent ([**] %) of the costs of clinical studies (beyond bioequivalency studies) required to seek or achieve Marketing Approval of the Lovenox-Referenced Product in any country in the European Territory, subject to Section 11.3; and

 

4.1.1.c.        with respect to each of the Glycoprotein Products, Sandoz shall bear all Development Costs incurred under this Agreement with respect to Development activities required to seek Marketing Approval for such Product in the relevant Territory.

 

4.1.2.       Legal Expenses.  Subject to the provisions of Section 12.5, Sandoz shall be responsible for all Legal Expenses incurred by the Parties in performing their obligations under this Agreement.  Legal Expenses that are Legal Clearance Costs shall be incurred by the Parties according to the relevant Annual Collaboration Plan.

 

4.1.3.       Product-Specific Patent Costs.

 

4.1.3.a.        Momenta shall bear only the relevant Momenta Profit Percentage of the Product-Specific Patent Costs for each of the Collaboration Products and Sandoz shall bear the remainder of such costs.

 

4.1.3.b.       Sandoz shall be responsible for all Product-Specific Patent Costs for each of the Glycoprotein Products.

 

4.1.4.       Commercialization Costs.  Subject to the provisions of this Agreement, Sandoz shall be responsible for all Commercialization Costs for each Product and Momenta shall bear no responsibility for the Commercialization Costs for the Products;

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

27

 

provided, however, that Commercialization Costs with respect to [**] and, if Sandoz requests Momenta’s assistance with other Commercialization activities other than the [**], Sandoz shall reimburse Momenta at its Cost of Good Sold within [**] days after Sandoz’s receipt of an invoice therefor (provided, however, that Third Party Royalties shall be allocated pursuant to Section 4.1.5).

 

4.1.5.      Third Party Royalties.

 

4.1.5.a.        Momenta shall be responsible for all payments due to MIT pursuant to the MIT Agreement with respect to the Products.

 

4.1.5.b.       Except with respect to Sandoz’ indemnity obligations under Section 12, Momenta shall be responsible for all payments (if any) due to [**] pursuant to the Collaboration Agreement, dated [**], as amended by Amendment Number One dated [**] and Amendment Number Two dated [**], between [**] and Momenta, and the Collaboration Agreement, dated [**], between [**] and Momenta, or any other agreement between Momenta and [**] related to any of the aforesaid agreements or the intellectual property covered by any of the aforesaid agreements.

 

4.1.5.c.        Except as provided in Sections 4.1.5(a) and (b), (i) with respect to each Collaboration Product, Momenta shall bear only the Momenta Profit Percentage of Third Party Royalties with respect to such Product, which, with respect to such Third Party Royalties incurred after Launch of such Product in the relevant country, shall be borne by Momenta as an offset from its Profit Interest through the calculation of Profits and Cost of Goods Sold hereunder and Sandoz shall bear the remainder of such costs; provided, that the Parties mutually agreed upon the need for the relevant license in accordance with Section 2.5 hereof; and (ii) with respect to each Glycoprotein Product, Sandoz shall determine the need for the relevant license in accordance with Section 2.5 and shall bear the entire cost of Third Party Royalties with respect to such Product.

 

4.2.          Milestone Payments.  Sandoz shall pay Momenta the following non-creditable, non-refundable milestone payments:

 

4.2.1.       Copaxone-Referenced Product.

 

4.2.1.a.        Ten Million Dollars (U.S.$10,000,000) within [**] days after Sandoz’ (or its Affiliates’ or sublicensees’) receipt of Application Final Approval from the FDA for a Fully-Substitutable Copaxone-Referenced Product in the U.S. Territory, if no Third Party (excluding Teva) has, as of the date of such receipt, received Application Final Approval for a Fully-Substitutable Copaxone-Equivalent Product in the U.S. Territory.

 

4.2.1.b.       Ten Million Dollars (U.S.$10,000,000) within [**] days after the First Commercial Sale of a Fully-Substitutable Copaxone-Referenced Product in the U.S. Territory.

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

28

 

4.2.1.c.        [**] Dollars (U.S.$[**]), within [**] days after the end of each of the [**] Commercial Year through the [**] Commercial Year for the Copaxone-Referenced Product, if (i) (A) such Copaxone-Referenced Product is Fully-Substitutable in the U.S. Territory, (B) there is no Third Party (excluding Teva) with an approved Application in the U.S. Territory for a Fully-Substitutable Copaxone-Equivalent Product during such Commercial Year and (C) Profits (calculated without deducting such milestone from Net Sales) in the U.S. Territory with respect to the Copaxone-Referenced Product during such Commercial Year equal or are greater than [**] Dollars (U.S.$[**]) or (ii) (A) such Copaxone-Referenced Product is not Fully-Substitutable, (B) there is no Third Party (excluding Teva) with an approved Application in the U.S. Territory for a Copaxone-Equivalent Product (whether or not such Copaxone-Equivalent Product is Fully-Substitutable) during such Commercial Year and (C) Net Sales in the U.S. Territory with respect to the Copaxone-Referenced Product during such Commercial Year equal or are greater than [**] Dollars (U.S.$[**]).

 

4.2.1.d.       [**] Dollars (U.S.$[**]) within [**] days after the end of the first twelve (12) month period during which Net Sales of the Copaxone-Referenced Product equal or are greater than [**] Dollars (U.S.$[**]) in the U.S. Territory.

 

4.2.1.e.        In addition, [**] Dollars (U.S.$[**]) within [**] days after the end of the first twelve (12) month period subsequent to, and not overlapping with, the period described in Section 4.2.1(d), during which Net Sales of the Copaxone-Referenced Product equal or are greater than [**] Dollars (U.S.$[**]) in the U.S. Territory.

 

4.2.2.       Lovenox-Referenced Product.

 

4.2.2.a.        [**] Dollars (U.S.$[**]) within [**] days after the First Commercial Sale of the Lovenox-Referenced Product in any country in the European Territory if, on the date of such First Commercial Sale, there is no Third Party (other than Sanofi-Aventis) with an approved Application in the European Territory for a Fully-Substitutable Lovenox-Equivalent Product.

 

4.2.2.b.       [**] Dollars (U.S.$[**]), within [**] days after the end of each of the [**] Commercial Year through the [**] Commercial Year for the Lovenox-Referenced Product in the European Territory, if there is no Third Party (other than Sanofi-Aventis) with an approved Application in the European Territory for a Fully-Substitutable Lovenox-Equivalent Product during such Commercial Year and if Profits (calculated without deducting such milestone from Net Sales) in the European Territory with respect to the Lovenox-Referenced Product during such Commercial Year equal or are greater than [**] Dollars (U.S.$[**]).

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

29

 

4.2.3.       [**]-Referenced Product.

 

4.2.3.a.        [**] Dollars (U.S.$[**]) within [**] days after the First Commercial Sale of a Fully-Substitutable [**]-Referenced Product in the U.S. Territory or [**] Dollars (U.S.$[**]) within [**] days after the First Commercial Sale in the U.S. Territory of an [**]-Referenced Product which is not Fully-Substitutable (the latter, a “Non-Substitutable [**] Launch”).

 

4.2.3.b.       If there was a Non-Substitutable [**] Launch then, in addition,:

 

4.2.3.b.1.         [**] Dollars (U.S.$[**]) within [**] days after receipt of Full-Substitutability for an [**]-Referenced Product if such receipt occurs within [**] years after such Non-Substitutable [**] Launch (a “Slightly Late [**] Substitutability Receipt”), or alternatively

 

4.2.3.b.2.         if there was no Slightly Late [**] Substitutability Receipt, then

 

4.2.3.b.2.1         (A) [**] Dollars (U.S.$[**]) within [**] days after the [**] anniversary of such Non-Substitutable [**] Launch, and

 

4.2.3.b.2.2         (B) [**] Dollars (U.S.$[**]) within [**] days after receipt of Full-Substitutability for an [**]-Referenced Product if such receipt occurs more than [**] years, but within [**] years, after such Non-Substitutable [**] Launch.

 

4.2.3.c.        An amount equal to the difference between (i) [**] Dollars (U.S.$[**]) and (ii) the total of all amounts which had already been paid by Sandoz to Momenta pursuant to Sections 4.2.3(a) and 4.2.3(b), within [**] days after the end of the first [**] month period during which Net Sales of the [**]-Referenced Product (regardless of whether it received Full-Substitutability) equal or are greater than [**] Dollars (U.S.$[**]).

 

4.2.3.d.       For the sake of clarity, in no event shall Sandoz be required to pay to Momenta more than [**] Dollars (U.S.$[**]) pursuant to this Section 4.2.3.

 

4.2.4.       [**]-Referenced Product.

 

4.2.4.a.        [**] Dollars (U.S.$[**]) within [**] days after the First Commercial Sale of a Fully-Substitutable [**]-Referenced Product in the European Territory, but, for the sake of clarity, no payment upon First Commercial Sale in the European Territory of an [**]-Referenced Product which is not Fully-Substitutable (the latter, a “Non-Substitutable [**] Launch”).

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

30

 

4.2.4.b.       If there was a Non-Substitutable [**] Launch, then the milestone under Section 4.2.3.a shall not be paid, and instead:

 

4.2.4.b.1.         (i) [**] Dollars (U.S.$[**]) within [**] days after receipt of Full-Substitutability for an [**]-Referenced Product if such receipt occurs within [**] years after such Non-Substitutable [**] Launch, or

 

4.2.4.b.2.         (ii) [**] Dollars (U.S.$[**]) within [**] days after receipt of Full-Substitutability for an [**]-Referenced Product if such receipt occurs more than [**] years, but within [**] years, after such Non-Substitutable [**] Launch.

 

4.2.4.c.        An amount equal to the difference between (i) [**] Dollars (U.S.$[**]) and (ii) the total of all amounts which had already been paid by Sandoz to Momenta pursuant to Sections 4.2.4(a) and 4.2.4(b), within [**] days after the end of the first twelve (12) month period during which Net Sales of the [**]-Referenced Product (regardless of whether it received Full-Substitutability) equal or are greater than [**] Dollars (U.S.$[**]).

 

4.2.4.d.       For the sake of clarity, in no event shall Sandoz be required to pay to Momenta more than [**] Dollars (U.S.$[**]) pursuant to this Section 4.2.4.

 

4.3.          Profit and Sublicense Income Sharing.  For each Quarter during which (a) Sandoz, its Affiliates or distributors is selling a Product in the relevant Territory, Sandoz shall pay Momenta an amount computed by multiplying the Profits with respect to such Product in such Territory during such Quarter by the relevant Momenta Profit Percentage (the “Profit Interest”); and (b) a Third Party has been granted a sublicense under this Agreement to Develop or Commercialize a Product in a country in the relevant Territory, Momenta shall receive an amount computed by multiplying the Sublicense Income from such Third Party during such Quarter by the relevant Momenta Profit Percentage.

 

4.4.          Payment/Accounting.

 

4.4.1.       Cost Reimbursement.  Within [**] days after the end of each Quarter during this Agreement, each Party shall provide to the other Party a written report documenting any Development Costs, Legal Expenses, Product-Specific Patent Costs, other patent costs allocated pursuant to Article 8, Momenta Third Party Royalty Obligations, Third Party Royalties and Commercialization Costs incurred by such Party during such just-ended Quarter which costs are to be borne now or in the future, in whole or in part, by such other Party.  Within [**] days after delivery of such reports, the Party which is owed money with respect to such expenses for such Quarter shall invoice the other Party for the amount of such expenses payable by such other Party in accordance with Section 4.1 and such other Party shall pay such amount within [**] days after receipt of such invoice.  Each Party will facilitate reasonable transparency for the costs (both such Party’s FTE Costs and out-of-pocket costs paid by such Party to Third Parties) incurred in the Collaborative Program which are to be borne now or in the future, in

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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whole or in part, by the other Party pursuant to this Agreement, and will have the relevant FTEs fill out routine timesheets in accordance with such Party’s then-current time-keeping procedures but at least twice per month.  In addition, each Party shall provide to the AMs, at approximately [**] an updated budget forecast, and, within [**] days after the end of each month, a written report of accruals, for any Development Costs, Legal Expenses, Product-Specific Patent Costs, other patent costs allocated pursuant to Article 8, Momenta Third Party Royalty Obligations, Third Party Royalties and Commercialization Costs incurred by such Party during such month (or portion thereof) which costs are to be borne now or in the future, in whole or in part, by the other Party.

 

4.4.2.       Payment Sharing.  With respect to each Product in each country in the relevant Territory, within [**] days after (a) the end of each Quarter following First Commercial Sale of such Product in such country, Sandoz shall report the amount of such Product sold in such Quarter, the gross amount invoiced, the deductions used in the calculation of Net Sales, the applicable Cost of Goods Sold, other deductions used to determine Profits, and the resulting calculation of Profit Interest due to Momenta (if no Profit Interest is due, the report shall so state), and (b) the end of each Quarter, each Party shall report to the other the amount of any Sublicense Income or any recovery as a result of any proceeding described in Section 8.4 or from any counterclaim or similar claim asserted in a proceeding described in Sections 8.5 or 8.6 received by such Party or its Affiliates during such Quarter.  With each such report, (x) Sandoz shall pay to Momenta the amount of Profit Interest due, and (y) the Party which has been overpaid with respect to Sublicense Income or such recovery shall pay to the other Party an amount such that Momenta has received the Momenta Profit Percentage of Sublicense Income or such recovery (after the reimbursement of each Party’s costs pursuant to Section 8.4.4(a)) with respect to the relevant Product in such Quarter.  Reports shall provide a reconciliation showing the amount due.

 

4.4.3.       Computation.  All payments due shall be payable in United States dollars.  Such payments shall be without deduction of exchange, collection, or other charges, and, specifically, without deduction of withholding or similar taxes or other government imposed fees or taxes, except as otherwise permitted pursuant to the definition of “Net Sales”.

 

4.4.4.       Interest.  Interest shall be payable on the aggregate amount of any payments that are not paid on or before the date such payments are due under this Agreement at a rate per annum equal to the lesser of (a) two percentage points above the prime rate of interest, as reported by The Wall Street Journal for the applicable period, or (b) the highest rate permitted by applicable law, in each case calculated on the number of days such payments are paid after the date they are due.

 

4.4.5.       Record Keeping.  Sandoz and Momenta shall keep, and shall require their Affiliates, distributors, licensees and sublicensees to keep, accurate and complete accounting records of the Products sold under this Agreement and all other records appropriate to determine the amount of Development Costs, Legal Expenses, Product-Specific Patent Costs, other patent costs allocated pursuant to Article 8, Momenta Third Party Royalty Obligations, Third Party Royalties and Commercialization Costs payable

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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by the other Party, and of milestone payments, share of Sublicense Income, share of recoveries as a result of any proceeding described in Section 8.4 or from any counterclaim or similar claim asserted in a proceeding described in Sections 8.5 or 8.6, and Profit Interest due to the other Party, hereunder (“Payables Records”).  Such Payables Records shall be retained for at least [**] years following a given reporting period.

 

4.4.6.       Audit.  Upon [**] days’ prior written notice, each Party shall permit its books and records of Payables Records to be examined for a particular calendar year, no more than once annually (provided, however, that if the most recent audit conducted on behalf of such Party disclosed a discrepancy, such Party may conduct another audit within such annual period at least [**] months after such prior audit is concluded), during normal business hours, by an independent auditor appointed by the other Party and reasonably acceptable to the audited Party, and at the auditing Party’s expense, to the extent necessary to verify the accuracy of the invoices, reports and payments delivered by the audited Party under this Agreement.  Any information received as a result of such inspection shall be maintained as the audited Party’s Confidential Information.

 

4.4.7.       Underpayment/Overpayment and Payment Disputes.  In the event an examining auditor specified in Section 4.4.6 concludes that an underpayment or overpayment was made, the auditor will specify such in a written report along with the information on which such conclusion is based.  This report will be shared promptly with the audited Party.  The amount of any such underpayment or the reimbursement of any such overpayment shall be due and payable by the audited Party within [**] days of the date of such report, together with interest calculated on the amount of such underpayment or overpayment in the manner provided in Section 4.4.4; provided that if a Party disputes the conclusion of the auditor, the Parties will resolve the dispute according to Article 13.  If the underpayment by the audited Party or the overpayment by the auditing Party differs by greater than five percent (5%) from the amount that was otherwise due, the audited Party shall pay all of the costs of such review.

 

5.        JOINT DEVELOPMENT AND COMMERCIALIZATION

 

5.1.          Joint Collaboration.  Sandoz and Momenta shall jointly collaborate in the Development and Commercialization of the Products and the Legal Activities with respect thereto, using Commercially Reasonable efforts to Develop the Products, to achieve Legal Clearance, to bring the Products to the market in the relevant Territories within a commercially reasonable time period (subject to the provisions of Section 6.2) and to Commercialize the Products in the relevant Territory and to use Commercially Reasonable efforts to maximize the Profits for each such Product throughout the relevant Territory.  The goal of the Collaborative Program is to Develop, register and Commercialize the Products as follows:  (a) the Collaboration Products as Fully-Substitutable, and (b) the Glycoprotein Products, with the goal of achieving Full-Substitutability, or as a Non-Substitutable Product if appropriate, at the discretion of Sandoz, subject to Section 5.2.  Notwithstanding any other provision of this Agreement, final decision on Development, regulatory, legal and Commercialization strategy shall reside with Sandoz for the Glycoprotein Products, subject to Section 5.2.

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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5.2.          Sandoz Final-Decision Making Authority.  With respect to any matter for which Sandoz has final decision-making authority under the Agreement and for which there is a disagreement, the following provisions shall apply:  The relevant matter shall be identified to, and discussed by, the JOC.  The JOC shall in good faith attempt to resolve the matter.  If the JOC is unable to decide or resolve such matter, then Sandoz shall have the deciding vote with respect to such dispute; provided, however, that Sandoz shall consult with, and give due consideration to, Momenta’s input with respect thereto; and further provided, however, that with respect to Pre Final Legal Clearance Launch, the JSC shall be substituted for the JOC in the prior portions of this Section 5.2.  In no event may Sandoz exercise its final-decision-making authority under this Agreement to (a) obligate Momenta to spend money or devote resources outside those previously agreed to in the relevant mutually-agreed Annual Collaboration Plan, (b) unilaterally amend the terms of this Agreement or override Momenta’s rights in this Agreement, or (c) unilaterally determine that it has fulfilled any obligations under this Agreement or that Momenta has breached any obligations under this Agreement.  Except with respect to its decision to proceed with Pre Final Legal Clearance Launch with respect to a Product in a country, which may be made in Sandoz’s sole discretion, Sandoz shall exercise its final decision-making authority in good faith and in a Commercially Reasonable manner.

 

5.3.          [**].  Notwithstanding anything to the contrary herein, Sandoz has the option to develop and commercialize the Copaxone-Referenced Product independently of Momenta for [**]; provided, that, if it wishes to do so, it shall notify Momenta in writing at the time when Sandoz first approves the commitment of resources (consistent with its internal decision process) to develop the Copaxone-Referenced Product independently of Momenta for [**].  Immediately following Sandoz’s approval of the commitment of such resources, Momenta shall have the right, without any further obligation to Sandoz, to develop and commercialize the Copaxone-Referenced Product independently of Sandoz for [**].

 

5.4.          Joint Project Team.  The Development and Commercialization activities and Legal Activities for each Product shall be conducted and managed on an on-going basis through a Joint Project Team for such Product (each such team, a “JPT”); provided, however, that Sandoz shall be responsible for the day-to-day management of such Commercialization activities, subject to the oversight of the relevant JPT and in accordance with the Annual Collaboration Plan.  Each JPT shall have one (1) Joint Project Team Leader (each, a “JPTL”).  Each Party shall designate a Local Project Leader (each, an “LPL”) to function as the liaison and to coordinate efforts and communication for such JPT within such Party with respect to such Product.  The JPTL for each Glycoprotein Product shall be selected by Sandoz; the JPTL for the Copaxone-Referenced Product shall be selected by Momenta; and the JPTL for the Lovenox-Referenced Product shall be selected by the JOC.  Each JPTL shall report to the AMs.  Each JPT shall be responsible, via oversight by the JPTL with respect to the relevant Product, for:  (a) executing all on-going aspects of the Development and Commercialization of, and the Legal Activities with respect to, such Product; (b) preparing and submitting to the Alliance Managers Annual Collaboration Plans for each Contract Year; (c) discussing and resolving ongoing issues; (d) periodically reporting to the JOC, through the JAM, and referring any disputes not resolved by the JPTs to the JOC for resolution; and (e) periodically reporting to the JOC and the Legal/Intellectual Property Team the status of intellectual property relevant to the Collaborative Program.  Each JPT shall only act unanimously and each Party, acting through its representatives, shall have one vote on each JPT.  Each JPT will be composed of functional area representatives who are directly involved with and

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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responsible for Development and Commercialization activities and Legal Activities (which may include, but are not limited to, analytics, characterization, process development, bioequivalence/clinical, regulatory, intellectual property/legal, commercialization and supply chain, each as appropriate for the stage of Development or Commercialization of the relevant Product) per the relevant Annual Collaboration Plan.  The JOC may alter the functional composition of and representation on a JPT over time as appropriate.  Momenta and Sandoz may each change its JPT representatives at any time by giving written notice to the other.  Additional representatives of a Party may attend meetings of the JPTs on an ad hoc invited basis as appropriate.  Each JPT shall meet at least monthly during the course of the Collaborative Program.  Within [**] days after each meeting, the JPT (via the JPTL and LPL) will provide the Alliance Managers with a written report describing the status of the Collaborative Program with respect to the relevant Product, including, without limitation, a summary of the results and progress to date, the status of the then-current budget in the relevant Annual Collaboration Plan (actuals vs. estimates), project timelines, critical path issues and any other issues requiring resolution, proposed solutions to such issues, and the agreed resolution of previously reported issues.

 

5.5.          Alliance Managers.  Each Party shall appoint a senior representative who possesses a general understanding of the relevant technical, regulatory, commercial and legal issues to act as its Alliance Manager (each, an “AM” or “Alliance Manager”).  The AMs shall be charged with creating and maintaining a collaborative and efficient work environment within and among the Committees.  The AMs shall ensure efficient and responsive communication among each JPT, the JOC, and the JSC.  The AMs will also be responsible for:  (a) seeking consensus (both internally, within his/her respective Party’s organization, as well as together, between the Parties) regarding key strategy and Collaborative Program issues; (b) coordinating the various activities of each JPTL and LPL, if appropriate, in developing and executing global strategies and plans for the Products; and (c) identifying and raising cross-country (within the relevant Territory), cross-Party and/or cross-functional disputes to the JOC in a timely manner.  The JAM will be responsible for:  (y) assisting the JOC and JSC co-chairs in setting appropriate meeting agendas, and preparing meeting minutes, as appropriate, in a format agreed upon with the JOC and JSC, respectively; and (z) in collaboration with the other AM, drafting and revising on a regular basis a monthly executive summary of the status of the Collaborative Program, in a format agreed upon with the JSC, and providing such summary to the JSC and JOC.  Sandoz may select the initial JAM from among the initial AMs; provided, however, that the JOC may change the JAM by selecting from between the then-current AMs.

 

5.6.          Joint Operating Committee.  The Joint Operating Committee (“JOC”) shall consist of six (6) members, three (3) representatives from each Party, each of whom shall have the authority, experience and seniority sufficient to enable him or her to make decisions on behalf of the Party he or she represents, and each JOC member will have the sufficient capacity and shall commit sufficient effort to manage all aspects of the collaboration.  Each AM shall be invited to JOC meetings as guests of the JOC.  One member from among each Party’s JOC members who are members of such Party’s management team will be selected as co-chair.  The JOC membership shall be approved by the JSC and the JSC shall select the co-chairs of the JOC from among the then-current members; provided, however, that the initial JOC co-chairs will be Sandoz’s Vice President and Global Head of Biopharmaceutical Development (or the equivalent) and Momenta’s Senior Vice President, Strategic Business Operations (or the equivalent).

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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Momenta and Sandoz may each change its JOC representatives or designated co-chairs at any time by giving written notice to the other.  The JOC shall meet at least [**] month.

 

5.7.          JOC Responsibilities.  The JOC shall be responsible for:  (a) overseeing each Product’s ongoing Development and Commercialization activities and Legal Activities under the Collaborative Program (including, without limitation, (i) determining the strategy to achieve Legal Clearance, including, without limitation, the strategy with respect to Paragraph IV filings and foreign equivalents, and Patent Litigation, and (ii) determining the patent prosecution and enforcement strategy with respect to the Joint Collaboration IP, the Collaboration Product-Specific Patent Rights and the Glycoprotein Product-Related Patent Rights); (b) providing overall guidance to the JPTs; (c) reviewing and endorsing to the JSC each Product’s Annual Collaboration Plan, or any changes thereto, including without limitation, the budgets contained therein, pursuant to Section 5.13, and any changes thereto; (d) reviewing each JPT’s progress toward milestones in the Annual Collaboration Plans and updating such progress at least every [**] months; (e) establishing a Regulatory and Policy Strategy Team as described in Section 7.6; (f) establishing a Legal / Intellectual Property Team (the “Legal /Intellectual Property Team”) to provide strategic support with respect to legal and intellectual property strategy matters for the Products; (g) attempting to resolve disputes within any JPT; (h) referring any disputes not resolved by the JOC to the JSC for resolution; and (i) performing such other tasks and undertaking such other responsibilities as are set forth in this Agreement.  The JOC shall only act unanimously and each of Momenta and Sandoz, acting through its representatives, shall have one vote on the JOC.

 

5.8.          Joint Steering Committee.  The Joint Steering Committee (“JSC”) shall consist of six (6) members, three (3) representatives from each of Sandoz and Momenta, each of whom shall have the authority, experience and seniority sufficient to enable him or her to make final decisions on behalf of the Party he or she represents, and each JSC member will have the sufficient capacity and shall commit sufficient effort to manage all aspects of the collaboration.  One member from among each Party’s JSC members who are members of such Party’s executive management team will be selected as co-chair.  For one (1) year after the Effective Date, the co-chairs shall be Sandoz’s Chief Executive Officer, and Momenta’s Chief Executive Officer.  Momenta and Sandoz may each change its JSC representatives or designated co-chairs at any time after the first anniversary of the Effective Date (or earlier if a representative or co-chair is no longer employed by the relevant Party or is unavailable to serve due to disability) by giving written notice to the other; provided, however, that a Party’s co-chair must directly report to such Party’s chief executive officer.

 

5.9.          JSC Administration.  The JSC co-chairs shall be responsible for calling meetings of the JSC and for leading the meetings.  The JSC shall meet at least [**] times annually during the course of the Collaborative Program.  Following each JSC meeting, the AMs shall jointly prepare draft meeting minutes, and shall submit such draft minutes to the JSC co-chairs within [**] days of such meeting to allow adequate review and comment.  Minutes shall provide a description of the discussions held at the meeting and a list of any actions, decisions or determinations approved by the JSC.  Minutes of each JSC meeting shall be approved or disapproved, and revised as necessary, at the next meeting and, following approval, shall be signed by the JSC co-chairs.  Final minutes of each meeting shall be distributed to the members of the JSC by the JSC co-chairs.  The JSC shall only act unanimously and each of Momenta and

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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Sandoz, acting through its representatives, shall have one vote on the JSC.  Disputes shall be resolved pursuant to Article 13.

 

5.10.        JSC Responsibilities.  The JSC shall be responsible for:  (a) overseeing the broad strategy of the Collaborative Program; (b) final approval of Annual Collaboration Plans and any changes thereto, with the goal of approving or rejecting (i) such plan within [**] days of the proposal of such plan and (ii) any changes thereto within [**] Business Days of the proposal of such change; (c) resolving disputes within the JOC; and (d) performing such other tasks and undertaking such other responsibilities as are set forth in this Agreement.

 

5.11.        JPT, JOC and/or JSC Meetings.  The location of meetings of the JPTs, JOC and JSC shall alternate between Sandoz’s principal place of business and Momenta’s principal place of business, or as otherwise agreed by the Parties.  The JPTs, JOC and JSC may also meet by means of a telephone conference call or videoconference.  Each Party shall use reasonable efforts to cause its representatives to attend such meetings.  If a representative of a Party is unable to attend a meeting, such Party may designate an alternate to attend such meeting in place of the absent representative.  In addition, each of Momenta and Sandoz may, at its discretion, invite non-voting employees, and, with the consent of Sandoz and Momenta, respectively, consultants or scientific advisors, to attend the meetings of the JOC or JSC to, among other things, review and discuss the Collaborative Program and its results.  Either Momenta or Sandoz may convene a special meeting of the JPTs, JOC or JSC for the purpose of resolving disputes.

 

5.12.        Termination of Committees.  Notwithstanding anything to the contrary herein, no Committee (or any other committee which the Parties may establish on which members of both Parties participate) shall remain in existence after July 25, 2031, the twenty-fifth (25th) anniversary of the MOU Effective Date.  In the event that either Party desires to continue the aforementioned activities after such date, and such desire is raised in the JSC after July 25, 2030 but before July 25, 2031, the Parties will discuss an extension in good faith.

 

5.13.        Annual Collaboration Plans.  The Parties shall undertake the Collaborative Program in accordance with the Annual Collaboration Plans.  Each JPT shall prepare the Annual Collaboration Plan for the relevant Product (a) for the First Contract Year within [**] days after the Effective Date, and (b) for the Second Contract Year and subsequent Contract Years at least [**] days prior to the commencement of such Contract Year.  The JSC shall review and approve the Annual Collaboration Plans (i) for the First Contract Year within [**] days after it has been presented to the JSC, and (ii) for the Second Contract Year and subsequent Contract Years at least [**] days prior to the commencement of such Contract Year.  The JPTs shall prepare and submit to the JOC for review and endorsement, and the JSC shall review and approve, updates and amendments, as appropriate, to the then-current Annual Collaboration Plans during the course of the applicable Contract Year.  Each Annual Collaboration Plan shall be consistent with the other terms and conditions of this Agreement.  Each Annual Collaboration Plan shall specify, among other things, with respect to the relevant Product, (A) specific objectives of the Collaborative Program during the applicable Contract Year, (B) specific activities to be performed by each Party, or by Third Parties, in support of the Collaborative Program during the applicable Contract Year, with primary responsibility for executing specific functions determined in good faith by the relevant JPT according to the Parties’ respective capabilities and expertise, and (C) a budget reflecting the resources (including FTEs) to be assigned and amounts

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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expended by each Party in support of the Collaborative Program.  In particular, to support the Development and Commercialization of, and Legal Activities with respect to, the Products, the relevant Annual Collaboration Plan shall specify the activities to be performed by each Party, or by Third Parties, and the related resources (including FTEs) to be assigned and the strategic marketing plan for the relevant Product in the relevant Territory.  In preparing the initial Annual Collaboration Plans, the relevant JPT shall assign specific activities to the relevant Party(ies).  While all activities will be considered joint activities within the collaboration, the JPTs shall assign specific activities to the relevant Party(ies) to execute.  The Annual Collaboration Plans, to be approved by the JSC, will include a complete list of activities and the assignment of the relevant Party(ies) for each such activity.  While a given Party may be assigned the lead responsibility for an activity, it will be the responsibility of such Party to achieve cross-company alignment on the strategy and the plans to complete the activity consistent with the integrated strategy as defined in the Annual Collaboration Plans.

 

5.14.        Compliance with Laws.  Each Party agrees to use Commercially Reasonable efforts to carry out all work assigned to such Party in the Annual Collaboration Plans and its other obligations under this Agreement in material compliance with all applicable federal, national, multinational, state, provincial or local regulatory laws, regulations and guidelines governing the conduct of such work, including, without limitation, (a) the FD&C Act and any applicable implementing regulations, and relevant foreign equivalents thereof; (b) cGMPs; (c) all other applicable FDA guidelines and relevant guidelines of applicable Regulatory Authorities; (d) all other applicable laws and regulations, including all applicable federal, national, multinational, state, provincial and local environmental, health and safety laws and regulations in effect at the time and place of manufacture of a Product; and (e) all applicable export and import control laws and regulations.

 

5.15.        Legal Clearance.  Sandoz shall have sole responsibility to make decisions with respect to Legal Clearance (except with respect to the determination of whether Legal Clearance has occurred, which shall be determined in accordance with the definitions herein of Final ROW Legal Clearance and Final U.S. Legal Clearance, as applicable); provided, that such decisions are generally consistent with the strategy set therefor by the JOC.  Sandoz shall select counsel to assist with Patent Litigation occurring in the context of Legal Clearance, which counsel shall be reasonably acceptable to Momenta.

 

6.        ADDITIONAL COMMERCIALIZATION PROVISIONS

 

6.1.          Review and Oversight.  Other than with respect to Section 6.2, which activities shall be in the sole discretion of Sandoz, but subject to Section 5.2, all responsibilities of the Parties with respect to Commercialization of the Products shall be subject to the oversight and review of the JSC as set forth in Article 5.  Notwithstanding Sections 1.89, 13.2, or any other provision of this Agreement (other than Section 5.2), Sandoz or its sublicensees shall have the right to set all of the prices for the sale of Products to Third Parties which are their immediate customers in the relevant Territories; provided, that, with respect to the Collaboration Products, such prices are generally consistent with the pricing strategy set therefor by the JSC, although the Parties recognize that Sandoz shall have the flexibility to change such prices in order to respond to specific market conditions, and, with respect to the Glycoprotein Products, the JSC shall discuss pricing strategy for such prices.  Sandoz or its sublicensees shall be responsible for the

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

38

 

distribution and sale of the Products and for invoicing and booking sales of the Products in the relevant Territories. The name of each Collaboration Product shall be the generic name of the compound it contains unless the Parties mutually agree that its name shall include a trademark or tradename or be protected as a trademark (a “Branded Collaboration Product”).  For each Branded Collaboration Product, Sandoz may name such Product; provided, that such name shall not include any trademark or tradename or a part thereof that uses the name “Momenta”, “Sandoz” or a derivative of the foregoing or any other trademark or part or derivative thereof that is the name or derivative of a name of any Momenta Affiliate or Sandoz Affiliate, without the prior approval of Momenta.  Once Sandoz, its Affiliate or sublicensee begins selling a particular Product in a particular country in the relevant Territory, Sandoz shall use Commercially Reasonable efforts to sell such Product in such country in such Territory, itself or through its Affiliates or sublicensees, unless Sandoz makes a Commercially Reasonable decision to cease selling such Product in such country.

 

6.2.          Pre Final Legal Clearance Launch.  Notwithstanding any other provision in this Agreement, the Parties agree that if Application Final Approval for a Product has been obtained in a country in the relevant Territory but Final ROW Legal Clearance or Final U.S. Legal Clearance (as applicable) has not yet been obtained with respect to such Product in such country, Sandoz may, in its sole discretion, after reasonable consultation with and due consideration of input from Momenta, decide whether to proceed with Launch of such Product in such country, or to defer Launch until Final ROW Legal Clearance or Final U.S. Legal Clearance, respectively, has been obtained with respect to such Product in such country; subject to the penultimate sentence of Section 5.2.  Upon deciding to proceed with Pre Final Legal Clearance Launch with respect to such Product in such country, Sandoz shall promptly notify Momenta of such decision.

 

7.       REGULATORY MATTERS

 

7.1.          Review and Oversight.  All responsibilities under this Article 7 shall be subject to the review and oversight of the Committees as set forth in Article 5.

 

7.2.          Application Filing.  Sandoz shall file Application(s) in accordance with the relevant Annual Collaboration Plans for each Product in the relevant Territory under Sandoz’s name.  If the U.S. Territory Application for the Copaxone-Referenced Product includes a Paragraph IV Certification, Sandoz shall also provide to the applicable Innovator notice, as required by 21 U.S.C. § 355(b)(3) or 21 U.S.C. § 355(j)(2)(B), respectively.

 

7.3.          Ownership Of The Applications.  Sandoz shall own all Applications for the applicable Product in the relevant Territory, subject to Section 2.1.2.

 

7.4.          Application Responsibility.  The JSC shall determine the responsibilities of each Party with respect to the preparation of the Applications for the Products for the relevant Territories and related activities.  Momenta shall be responsible for compiling modules of any registration dossier which are related to its activities hereunder and to provide answers that can be given to the relevant Regulatory Authority therefor.

 

7.5.          Regulatory Interaction.  Except as provided in Section 7.6, the JSC shall determine the responsibilities of each Party with respect to interactions with the FDA or other

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

39

 

Regulatory Authority with respect to the Products in the relevant Territories; provided, however, that adverse event reporting obligations with respect to the Products shall be the primary responsibility of Sandoz, with Momenta’s assistance if reasonably requested by Sandoz.

 

7.6.          Regulatory Policy.  The JOC shall establish a team (the “Regulatory and Policy Strategy Team”) to provide overall strategic support to the Collaborative Program.  The Regulatory and Policy Strategy Team shall develop a plan detailing regulatory, legislative and public policy activities, and each Party’s responsibility, to articulate and present to key thought leaders and decisions makers a scientific basis for the granting of marketing approval for Fully-Substitutable versions of the Products and to facilitate the establishment of abridged regulatory and legal pathways in the Territory to enable the granting of marketing approval of Fully-Substitutable versions of the Products regulated under the USA FD&C and Public Health Service Act and/or foreign equivalent.

 

8.      INTELLECTUAL PROPERTY

 

8.1.          Ownership.

 

8.1.1.       Single Ownership.  As between Momenta and Sandoz, Sandoz shall own all Sandoz IP and Momenta shall own all Momenta IP.  Momenta hereby assigns to Sandoz all right, title and interest in and to any Improvements to Sandoz Know-How or Improvements to Sandoz Collaboration Know-How that are (other than works of authorship) conceived, or, solely with respect to works of authorship, authored, solely by Momenta or its Affiliates, or jointly by Sandoz or its Affiliates, on the one hand, and by Momenta or its Affiliates, on the other hand, during, and in the conduct of, the Collaborative Program (“Momenta Assigned Improvements”).  Sandoz hereby assigns to Momenta all right, title and interest in and to any Improvements to Momenta Know-How or Improvements to Momenta Collaboration Know-How that are (other than works of authorship) conceived, or, solely with respect to works of authorship, authored, solely by Sandoz or its Affiliates, or jointly by Sandoz or its Affiliates, on the one hand, and by Momenta or its Affiliates, on the other hand, during, and in the conduct of, the Collaborative Program (“Sandoz Assigned Improvements”).  The assigning Party shall execute all documents necessary to effectuate this Section 8.1.1.  Notwithstanding anything to the contrary herein, Sandoz, with respect to Sandoz IP, and Momenta, with respect to Momenta IP, shall have the right to assign Sandoz IP, in the case of Sandoz, or Momenta IP, in the case of Momenta, to its respective Affiliates, without the consent of the other Party, or to Third Parties, with the consent of the other Party, such consent not to be unreasonably withheld, so long as any such assignment pursuant to this sentence is subject to the licenses granted pursuant to this Agreement and is otherwise consistent with this Agreement.

 

8.1.2.       License Outside Field to Assigned Improvements.  Momenta hereby grants to Sandoz an irrevocable, perpetual, non-exclusive, royalty-free, sublicenseable license to practice Sandoz Assigned Improvements; except with respect to the Products in the Field in the relevant Territory, which shall be governed by the other provisions of this Agreement.  Sandoz hereby grants to Momenta an irrevocable, perpetual, non-exclusive, royalty-free, sublicenseable license to practice the Momenta Assigned Improvements;

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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except with respect to the Products in the Field in the relevant Territory, which shall be governed by the other provisions of this Agreement.

 

8.1.3.       Joint Ownership.  All Joint Collaboration IP shall be owned jointly on the basis of an undivided interest by Sandoz and Momenta.  Notwithstanding anything to the contrary herein, Sandoz and Momenta shall each have the right to use such Joint Collaboration IP, or sell, license or otherwise transfer such Joint Collaboration IP to its Affiliates or any Third Party, without the consent of the other Party so long as such use, sale, license or transfer is subject to the licenses granted pursuant to this Agreement and is otherwise consistent with this Agreement; provided, however, that if the Parties jointly license Joint Collaboration IP to a Third Party to Develop, make, have made, use, sell, offer to sell, lease, import, export or otherwise Commercialize a Product, the income therefrom shall be split so that Momenta receives the relevant Momenta Profit Percentage with respect thereto.

 

8.1.4.       Inventorship.  Inventorship, for the purposes of this Section 8.1, shall be determined by the Parties in good faith in accordance with U.S. Territory patent laws.  In the event of a dispute regarding inventorship or the ownership of Collaboration Know-How that the Parties are unable to resolve, mutually acceptable outside patent counsel not regularly employed by any Party or their Affiliates shall be retained to attempt to resolve such dispute. For the avoidance of doubt, Sandoz agrees that the provision or use of Sandoz Material shall not by itself be considered a Sandoz inventive contribution to the conception or authorship of any Momenta Collaboration Know-How, and that the provision or use of the Sandoz Material shall not by itself cause any resulting Know-How to be considered Joint Collaboration Know-How.

 

8.1.5.       Policies.  In order to protect the Parties’ Patent Rights in the Territory and under United States law, in any inventions conceived or reduced to practice during or as a result of the Collaborative Program, each Party agrees to maintain a policy that requires its employees, individual contractors, consultants and agents to record and maintain all data and information developed in the course of the Collaborative Program in such a manner as to enable the Parties to use such records to establish the earliest date of conception, invention and/or to document diligent reduction to practice.  At a minimum, the policy shall require such individuals to record all inventions generated by them in standard laboratory notebooks that are dated and corroborated by non-inventors on a regular, contemporaneous basis.

 

8.2.          Patent Prosecution.

 

8.2.1.       Momenta Patent Rights.  Subject to any Prior Obligations of Momenta, Momenta shall use Commercially Reasonable efforts to timely prepare, file, prosecute and maintain Momenta Patent Rights and Momenta Collaboration Patent Rights (in each case, other than any Glycoprotein Product-Related Patent Rights and Collaboration Product-Specific Patent Rights) in the relevant Territory.

 

8.2.2.       Sandoz Patent Rights.  Subject to any Prior Obligations of Sandoz, Sandoz shall use Commercially Reasonable efforts to timely prepare, file, prosecute and maintain

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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Sandoz Patent Rights and Sandoz Collaboration Patent Rights (in each case, other than any Glycoprotein Product-Related Patent Rights and Collaboration Product-Specific Patent Rights) in the relevant Territory.

 

8.2.3.       Joint Collaboration Patent Rights and Collaboration Product-Specific Patent Rights.

 

8.2.3.a.    Decisions by the JOC.  Subject to any Prior Obligations of the Parties, the Parties, through the JOC, shall make all decisions regarding whether and how to file and maintain any Joint Collaboration Patent Rights (other than Glycoprotein Product-Related Patent Rights) and Collaboration Product-Specific Patent Rights (other than Glycoprotein Product-Related Patent Rights), and shall designate a Party as having the initial right to prepare, file and prosecute such Patent Rights in the relevant Territory (the “Prosecuting Party”); provided, however, that, in the event of a dispute within the JOC and JSC with respect to such decisions, mutually acceptable outside patent counsel not regularly employed by any Party or their Affiliates shall be retained to resolve such dispute.

 

8.2.3.b.    Conduct of Prosecution.  Subject to any Prior Obligations of the Parties, the Prosecuting Party shall have the initial right, but not the obligation, to timely prepare, file, prosecute and maintain, in the relevant Territory, the Joint Collaboration Patent Rights or Collaboration Product-Specific Patent Rights as to which it has been designated pursuant to Section 8.2.3.a. (in its own name, in the name of the other Party or in the name of both Parties, as applicable).  The Prosecuting Party shall have the full authority, subject to the conditions of Sections 8.2.3.c, 8.2.5, and 8.2.6, below, to make all decisions, and take all actions, that are necessary to obtain effective protection of said Patent Rights, including, but not limited to, the authority to draft and file appropriate responses, conduct interviews with examining authorities, and to represent either or both Parties in any appeal(s), relating to the prosecution of said Patent Rights.  The Prosecuting Party shall require its patent counsel to (i) keep the other Party reasonably informed about prosecution status and strategy, and (ii) provide the other Party in a timely manner with copies of all official correspondence to and from the relevant patent office, with respect thereto.  The Prosecuting Party shall consider in good faith all comments, suggestions, and proposals by the other Party for any response to communications from the relevant patent office, should they be provided to the Prosecuting Party in a timely fashion to permit their consideration and incorporation into any response thereto.  The Prosecuting Party shall have the ultimate authority and discretion to take any action that is necessary to obtain effective protection of said Patent Rights.

 

8.2.3.c.    Step-In Rights.  Subject to any Prior Obligations of the Parties, in the event that the Prosecuting Party declines to file, prosecute or maintain any Joint Collaboration Patent Rights or Collaboration Product-Specific Patent Rights as to which is has been designated pursuant to Section 8.2.3.a, elects to allow any such Patent Rights to lapse, or elects to abandon any such Patent Rights before all appeals within the respective patent office have been

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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exhausted, either in whole or in part, the other Party may assume control of the filing, prosecution and/or maintenance of such Patent Rights (in its own name, in the name of the other Party or in the name of both Parties, as applicable).  The Prosecuting Party shall provide the other Party with reasonable notice of its decision to decline to file, prosecute or maintain any such Patent Rights or its election to allow any such Patent Rights to lapse, or its election to abandon any such Patent Rights, so as to permit the other Party to decide whether to file, prosecute or maintain the same, and to take any necessary action.

 

8.2.4.      Glycoprotein Product-Related Patent Rights.

 

8.2.4.a.    Decisions by the JOC.  Subject to any Prior Obligations of the Parties, the Parties, through the JOC, shall make all decisions regarding whether and how to file and maintain any Glycoprotein Product-Related Patent Rights, and shall designate a Prosecuting Party as having the initial right to prepare, file and prosecute such Patent Rights in the relevant Territory; provided, however, that, in the event of a dispute within the JOC with respect to such decisions which is not resolved within [**] days (inclusive of any escalation pursuant to Sections 5.7(h), 13.1 and 13.2), if such Glycoprotein Product-Related Patent Rights are Joint Collaboration Patent Rights, Sandoz shall be the Prosecuting Party; and otherwise the Owning Party shall be the Prosecuting Party.

 

8.2.4.b.    Conduct of Prosecution.  Subject to any Prior Obligations of the Parties, the Prosecuting Party shall have the initial right, but not the obligation, to timely prepare, file, prosecute and maintain, in the relevant Territory, the Glycoprotein Product-Related Patent Rights as to which it has been designated pursuant to Section 8.2.4.a. (in its own name, in the name of the other Party or in the name of both Parties, as applicable).  The Prosecuting Party shall have the full authority, subject to the conditions of Sections 8.2.4.c, 8.2.5, and 8.2.6, below, to make all decisions, and take all actions, that are necessary to obtain effective protection of said Patent Rights, including, but not limited to, the authority to draft and file appropriate responses, conduct interviews with examining authorities, and to represent either or both Parties in any appeal(s), relating to the prosecution of said Patent Rights.  The Prosecuting Party shall require its patent counsel to (a) keep the other Party reasonably informed about prosecution status and strategy, and (b) provide the other Party in a timely manner with copies of all official correspondence to and from the relevant patent office with respect thereto.  The Prosecuting Party shall consider in good faith all comments, suggestions, and proposals by the other Party for any response to communications from the relevant patent office, should they be provided to the Prosecuting Party in a timely fashion to permit their consideration and incorporation into any response thereto, and the Prosecuting Party shall further require its patent counsel to timely provide to the other Party, to the extent possible and practicable, drafts of amendments or arguments to be made in any such response, prior to filing, and the Prosecuting shall consider in good faith the comments of the other Party thereon, if timely provided.  The Prosecuting Party nonetheless shall have the ultimate authority and discretion to take any action that

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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is necessary to obtain effective protection of said Patent Rights, without consultation with the other Party, if either the other Party has failed to provide its comments and counsel in a timely fashion, or if it is not possible and practicable to consult with the other Party before any such action must be taken.

 

8.2.4.c.    Step-In Rights.  Subject to any Prior Obligations of the Parties, in the event that the Prosecuting Party declines to file, prosecute or maintain any Glycoprotein Product-Related Patent Rights as to which is has been designated pursuant to Section 8.2.4.a, elects to allow any such Patent Rights to lapse, or elects to abandon any such Patent Rights before all appeals within the respective patent office have been exhausted, either in whole or in part, the other Party may, at its expense (subject to Section 4.1.3, and provided that, with respect to any Glycoprotein Product-Related Patent Rights which are Joint Collaboration Patent Rights, such costs shall be borne equally by the Parties, except as provided in Section 4.1.3), assume control of the filing, prosecution or maintenance of such Glycoprotein Product-Related Patent Rights (in its own name, in the name of the other Party or in the name of both Parties, as applicable).  The Prosecuting Party shall provide the other Party with reasonable notice of its decision to decline to file, prosecute or maintain any such Patent Rights, or its election to allow any such Patent Rights to lapse, or its election to abandon any such Patent Rights, so as to permit the other Party to decide whether to file, prosecute or maintain the same, and to take any necessary action.

 

8.2.5.       Best Efforts.  The Prosecuting Party under Section 8.2.3 or 8.2.4 shall use its best efforts to prosecute and maintain the Patent Rights as to which it has been designated pursuant to Section 8.2.3.a. or 8.2.4.a., respectively, to assure that the invention(s) underlying the same are protected to the fullest extent under applicable national law in the Territory, regardless of whether or not it is the Owning Party of such Patent Rights, subject to the Prosecuting Party’s right to decline to file, prosecute or maintain the relevant Patent Rights, to elect to allow the relevant Patent Rights to lapse, or to elect to abandon any such Patent Rights before all appeals within the respective patent office have been exhausted, in accordance with Sections 8.2.3.c. or 8.2.4.c., respectively.

 

8.2.6.       Cooperation and Assistance.  Each Party agrees to reasonably cooperate with the other and render all reasonable assistance as may be necessary to support any patent application filed by the other Party under this Section 8.2, including, but not limited to, consulting and coordinating with each other on any such patent filing activities to ensure that any Patent Rights or Confidential Information are not unduly compromised.

 

8.2.7.       Costs.  Except for Product-Specific Patent Rights, the costs for which shall be borne in accordance with Section 4.1.3, and except as stated otherwise in Section 8.2.4.c, out-of-pocket filing, prosecution and maintenance costs shall be borne by the Parties as follows:  (a) with respect to the Joint Collaboration Patent Rights, such costs shall be borne equally by the Parties; (b) with respect to Momenta Patent Rights and Momenta Collaboration Patent Rights, such costs shall be borne solely by Momenta; and

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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(c) with respect to Sandoz Patent Rights and Sandoz Collaboration Patent Rights, such costs shall be borne solely by Sandoz.

 

8.3.          Participation of Other Persons.

 

8.3.1.       Each of Sandoz and Momenta shall be responsible for executing an appropriate agreement with each employee, individual contractor, consultant or agent (including, for purposes of clarity, individuals who regularly work for Affiliates of Sandoz or Momenta) working on their respective behalves on the Collaborative Program, including a provision requiring such employee, individual contractor, consultant or agent to assign to Sandoz or Momenta, respectively, all Know-How and Patent Rights which he or she develops or conceives and/or reduces to practice during his or her work on the Collaborative Program so that such Know-How and Patent Rights are Controlled by Sandoz or Momenta, respectively.

 

8.3.2.       Each Party shall be responsible for executing an appropriate agreement with its Affiliate(s) requiring such Affiliate to assign to such Party, or to exclusively license to such Party, all Know-How and/or Patent Rights which such Affiliate develops or conceives and/or reduces to practice during its work on the Collaborative Program so that such Know-How and/or Patent Rights are Controlled by such Party.

 

8.3.3.       Except as the Parties may otherwise agree in writing, each of Sandoz and Momenta shall be responsible for executing an appropriate agreement with each Third Party contracting entity working on their respective behalves on the Collaborative Program, including a provision requiring such entity to assign to Sandoz or Momenta, respectively, or exclusively license to Sandoz or Momenta, respectively, all Know-How and Patent Rights with respect to the Products which such entity develops or conceives and/or reduces to practice during its work on the Collaborative Program so that such Know-How and Patent Rights are Controlled by Sandoz or Momenta, respectively.

 

8.3.4.       Each Party shall use Commercially Reasonable efforts to enforce the terms of their respective agreements described in Sections 8.3.1, 8.3.2 and 8.3.3.

 

8.4.          Enforcement of Patent Rights.

 

8.4.1.      Enforcement of Solely-Owned Patent Rights.

 

8.4.1.a.    Initial Rights.  Subject to any Prior Obligations of the Owning Party, the Owning Party shall have the initial right, but not the obligation, to institute an infringement action or take other appropriate action that it believes is reasonably required to protect its solely-owned Patent Rights (other than any Glycoprotein Product-Related Patent Rights or Collaboration Product-Specific Patent Rights) from infringement by a product competitive with a Product in the Field in the relevant Territory when, from its own knowledge or upon notice from the other Party, the Owning Party becomes aware of the reasonable probability that such infringement exists.  With respect to such an infringement, the Non-Owning Party may at any time join in any infringement action brought by the Owning Party and may be represented by counsel of its choice, but control of

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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such action shall remain with the Owning Party.  The Non-Owning Party shall join in any infringement action as a party at the Owning Party’s request in the event that an adverse party asserts, the court rules or other laws then applicable provide, or the Owning Party determines in good faith, that a court lacks jurisdiction based on such other Party’s absence as a party in such suit.

 

8.4.1.b.    Step-In Rights. Subject to any Prior Obligations of the Owning Party, in the event that the Owning Party shall not, within [**] months of written notice from the other Party of a suspected infringement of the Owning Party’s solely-owned Patent Rights (other than any Glycoprotein Product-Related Patent Rights or Collaboration Product-Specific Patent Rights) by a Third Party making, using, selling, offering to sell or importing a product competitive with a Product in the Field in the relevant Territory, commence and vigorously pursue an action to enjoin such infringement, the Non-Owning Party shall be entitled, at its expense, to commence the action in the name of the Owning Party; provided, however, that the Non-Owning Party shall consult with the Owning Party with respect to such action and shall give due consideration to the Owning Party’s advice and the Owning Party’s intellectual property protection strategy.  The Owning Party shall join in such infringement action as a party, at the request of the Non-Owning Party, in the event that the court rules or other laws then applicable shall require the joinder of the Owning Party as the owner of the Owning Party’s IP (other than any Glycoprotein Product-Related Patent Rights or Collaboration Product-Specific Patent Rights) for purposes of prosecuting such infringement action, but shall have no obligation to actively participate or incur expenses beyond the minimum level necessary to appear for the purpose of sustaining jurisdiction.

 

8.4.2.      Joint Collaboration IP and Collaboration Product-Specific Patent Rights.

 

8.4.2.a.    Decisions by the JOC.  Subject to any Prior Obligations of the Parties, the JOC shall make all decisions regarding enforcement of (a) the Joint Collaboration IP (other than Glycoprotein Product-Related Patent Rights) to protect such Joint Collaboration IP from infringement by a product competitive with a Product in the Field in the relevant Territory, and (b) the Collaboration Product-Specific Patent Rights (other than Glycoprotein Product-Related Patent Rights) in the relevant Territory, and shall designate a Party as having the initial right to institute an infringement action, or take other appropriate action, to protect such Joint Collaboration IP or Collaboration Product-Specific Patent Rights, as applicable, in the relevant Territory (the “Enforcing Party”); provided, however, that, in the event of a dispute within the JOC and JSC with respect to such decisions, mutually acceptable outside patent counsel not regularly employed by any Party or their Affiliates shall be retained to resolve such dispute.  Each Party shall provide to the other Party copies of any notices it receives from Third Parties regarding any patent nullity actions, any declaratory judgment actions, any alleged infringement or any alleged misappropriation of such Joint Collaboration IP or the Collaboration Product-Specific Patent Rights.  Such

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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notices shall be provided promptly, but in no event after more than [**] days following receipt thereof.

 

8.4.2.b.    Rights and Duties of the Enforcing Party.  Subject to any Prior Obligations of the Parties, the Enforcing Party shall have the initial right, but not the obligation, to institute an infringement action or take other appropriate action that it believes is reasonably required to protect the Joint Collaboration IP or Collaboration Product-Specific Patent Rights as to which it has been designated pursuant to Section 8.4.2.a from infringement by a product competitive with a Product in the Field in the relevant Territory when, from its own knowledge or upon notice from the other Party, the Enforcing Party becomes aware of the reasonable probability that such infringement exists.  With respect to such an infringement, the other Party may at any time join in any infringement action brought by the Enforcing Party and may be represented by counsel of its choice, but control of such action shall remain with the Enforcing Party.  The Enforcing Party shall keep the other Party reasonably informed about the enforcement strategy with respect thereto and copy the other Party on all papers exchanged with the opposing party or filed with any court with respect thereto.  The Enforcing Party shall consider in good faith all comments provided by the other Party with respect to any papers exchanged with the opposing party or filed with any court with respect thereto, which comments shall not be unreasonably rejected.  The other Party shall join in any infringement action as a party at the Enforcing Party’s request in the event that an adverse party asserts, the court rules or other laws then applicable provide or the Enforcing Party determines in good faith, that a court lacks jurisdiction based on the other Party’s absence as a party in such suit.

 

8.4.2.c.    Step-In Rights. Subject to any Prior Obligations of the Parties, in the event that the Enforcing Party shall not, within [**] months of written notice from the other Party or otherwise becoming aware of a suspected infringement of such Joint Collaboration IP or Collaboration Product-Specific Patent Rights by a Third Party making, using, selling, offering to sell or importing a product competitive with a Product in the Field in the relevant Territory, commence and vigorously pursue an action to enjoin such infringement, such other Party shall be entitled to commence the action in its name.  The Enforcing Party shall join in such infringement action as a party, at the request of the other Party, in the event that the court rules or other laws then applicable shall require the joinder of the Enforcing Party for purposes of prosecuting such infringement action, but shall have no obligation to actively participate or incur expenses beyond the minimum level necessary to appear for the purpose of sustaining jurisdiction.

 

8.4.3.      Glycoprotein-Related Patent Rights.

 

8.4.3.a.    Initial Rights.  Subject to any Prior Obligations of the Parties, the Parties, through the JOC, shall make all decisions regarding whether and how to enforce the Glycoprotein Product-Related Patent Rights to protect the

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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Glycoprotein Product-Related Patent Rights from infringement by a product competitive with a Glycoprotein Product in the Field in the relevant Territory, and shall designate an Enforcing Party as having the initial right to enforce such Glycoprotein Product-Related Patent Rights to protect such Glycoprotein Product-Related Patent Rights from infringement by a product competitive with a Glycoprotein Product in the Field in the relevant Territory; provided, however, that, in the event of a dispute within the JOC with respect to such decisions which is not resolved within [**] days (inclusive of any escalation pursuant to Sections 5.7(h), 13.1 and 13.2), if such Glycoprotein Product-Related Patent Rights are Joint Collaboration Patent Rights, Sandoz shall be the Enforcing Party; and otherwise the Owning Party shall be the Enforcing Party.

 

8.4.3.b.    Rights and Duties of the Enforcing Party. Subject to any Prior Obligations of the Parties, the Enforcing Party shall have the initial right, but not the obligation, to institute an infringement action or take other appropriate action that it believes is reasonably required to protect such Glycoprotein Product-Related Patent Rights from infringement by a product competitive with a Product in the Field in the relevant Territory when, from its own knowledge or upon notice from the other Party, the Enforcing Party becomes aware of the reasonable probability that such infringement exists.  With respect to such an infringement, the other Party may at any time join in any infringement action brought by the Enforcing Party and may be represented by counsel of its choice, but control of such action shall remain with the Enforcing Party, subject to the conditions of Sections 8.4.3.c.  The Enforcing Party shall keep the other Party reasonably informed about the enforcement strategy with respect thereto and copy the other Party on all papers exchanged with the opposing party or filed with any court with respect thereto.  The Enforcing Party shall consider in good faith all comments provided by the other Party with respect to any papers exchanged with the opposing party or filed with any court with respect thereto, which comments shall not be unreasonably rejected, should such comments be provided to the Enforcing Party in a timely fashion to permit their consideration and incorporation into such papers to be provided to the opposing party by the Enforcing Party or such filings to be provided to any court by the Enforcing Party, and the Enforcing Party shall further provide to the other Party, to the extent possible and practicable, drafts of such papers to be provided to the opposing party by the Enforcing Party or such filings to be provided to any court by the Enforcing Party, and the Enforcing Party shall consider in good faith the comments of the other Party thereon, if timely provided.  The Enforcing Party nonetheless shall have the ultimate authority and discretion to take any action that is necessary to enforce said Patent Rights, without consultation with the other Party, if either the other Party has failed to provide its comments and counsel in a timely fashion, or if it is not possible and practicable to consult with the other Party before any such papers must be exchanged or filings must be made.  The other Party shall join in any infringement action as a party at the Enforcing Party’s request in the event that an adverse party asserts, the court rules or other laws then applicable provide or the Enforcing Party determines in good faith, that a court lacks jurisdiction based on the other Party’s absence as a party in such suit.

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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8.4.3.c.    Step-In Rights. Subject to any Prior Obligations of the Parties, in the event that the Enforcing Party shall not, within [**] months of written notice from the other Party or otherwise becoming aware of a suspected infringement of such Glycoprotein Product-Related Patent Rights by a Third Party making, using, selling, offering to sell or importing a product competitive with a Product in the Field in the relevant Territory, commence and vigorously pursue an action to enjoin such infringement, such other Party shall be entitled, at its expense (subject to Section 4.1.3, and provided that with respect to any Glycoprotein Product-Related Patent Rights which are Joint Collaboration Patent Rights, such costs shall be borne equally by the Parties, , except as provided in Section 4.1.3), to commence the action in its name.  The Enforcing Party shall join in such infringement action as a party, at the request of the other Party, in the event that the court rules or other laws then applicable shall require the joinder of the Enforcing Party for purposes of prosecuting such infringement action, but shall have no obligation to actively participate or incur expenses beyond the minimum level necessary to appear for the purpose of sustaining jurisdiction.

 

8.4.4.      Recoveries.  Subject to any Prior Obligations of the Parties, any recovery obtained by a Party(ies) as a result of any proceeding described in this Section 8.4 or from any counterclaim or similar claim asserted in a proceeding described in Sections 8.5 or 8.6, by settlement or otherwise, shall be applied as follows:

 

8.4.4.a.    First, to reimburse each Party for all litigation costs in connection with such proceeding paid by that Party (on a pro rata basis, determined in accordance with the relevant Momenta Profit Percentage, based on each Party’s respective litigation costs, to the extent the recovery was less than all such litigation costs); and

 

8.4.4.b.    Second, the remainder of the recovery shall be shared so that Momenta receives the applicable Momenta Profit Percentage thereof.

 

8.4.5.       Cooperation; Settlements.  In the event that any Party takes action pursuant to this Section 8.4, the other Party shall cooperate with the Party so acting to the extent reasonably possible, including the joining of suit as required by this Agreement or as otherwise desirable.  No Party participating in such suit shall settle or compromise any claim or proceeding relating to the other Party’s Patent Rights or Know-How without obtaining the prior written consent of such other Party, such consent not to be unreasonably withheld, it being understood that the consent of a Third Party Licensor of such other Party, or of the relevant Sandoz Affiliate in accordance with the Existing US Lovenox Agreement, may also be required in order to settle or compromise any claim or proceeding relating to such Party’s Patent Rights or Know-How.

 

8.4.6.       Costs.  Except for Product-Specific Patent Rights, the costs for which shall be borne in accordance with Section 4.1.3, and except as stated otherwise in Sections 8.4.1.b or 8.4.3.c, out-of-pocket costs incurred in connection with any litigation or proceedings pursuant to this Section 8.4 shall be borne by the Parties as follows:  (a) with respect to the Joint Collaboration Patent Rights, such costs shall be borne equally by the

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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Parties; (b) with respect to Momenta Patent Rights and Momenta Collaboration Patent Rights, such costs shall be borne solely by Momenta; and (c) with respect to Sandoz Patent Rights and Sandoz Collaboration Patent Rights, such costs shall be borne solely by Sandoz.

 

8.5.          Claimed Infringement.  In the event that a Party becomes aware that the development, manufacture, use, sale, offer to sell or importation of a Product infringes, or is likely to or is alleged to infringe, the Patent Rights or Know-How of any Third Party, such Party shall promptly notify the other Party in writing, and, with respect to activities undertaken pursuant to this Agreement, the Parties shall cooperate and shall mutually agree, through the JOC, upon an appropriate course of action and shall act in accordance with such JOC-approved course of action; provided, however, that, to the extent that any action would involve the enforcement of a Party’s Patent Rights or the defense of an Invalidity Claim with respect to a Party’s Patent Rights, the general concepts of Section 8.4 shall apply to the enforcement of such Party’s Patent Rights or the defense of such Invalidity Claim (i.e., the Owning Party shall have the initial right, and the Non-Owning Party shall have a step-in right, to enforce or defend in the relevant Territory to the extent provided in Section 8.4.1, subject to any Prior Obligations of the Parties, other than Joint Collaboration IP, Collaboration Product-Specific Patent Rights and Glycoprotein Product-Related Patent Rights, for which decisions shall be made as provided in Sections 8.4.2, 8.4.2 and 8.4.3, respectively).  Each Party shall provide to the other Party copies of any notices it receives from Third Parties regarding any patent nullity actions, any declaratory judgment actions, or any alleged infringement or misappropriation of Momenta IP, Sandoz IP, Joint Collaboration IP or the Patent Rights or Know-How of any Third Party.  Such notices shall be provided promptly, but in no event later than [**] days following receipt thereof.

 

8.6.          Patent Invalidity Claim.  Subject to any Prior Obligations of the Parties, if a Third Party at any time asserts a claim that any Momenta IP, Sandoz IP or Joint Collaboration IP is invalid or otherwise unenforceable (an “Invalidity Claim”), whether as a defense in an infringement action brought by a Party pursuant to Section 8.4 or in an action brought against a Party under Section 8.5, the general concepts of Section 8.4 shall apply to such Invalidity Claim (i.e., the Owning Party shall have the initial right, and the Non-Owning Party shall have a step-in right, to defend such Invalidity Claim in the relevant Territory to the extent provided in Section 8.4.1, in the case of claims regarding the Owning Party’s IP (other than any Joint Collaboration IP, Collaboration Product-Specific Patent Rights and Glycoprotein Product-Related Patent Rights, which are provided for in Sections 8.4.2, 8.4.2 and 8.4.3, respectively), subject to any Prior Obligations of the Parties).  No Party shall settle or compromise any Invalidity Claim without obtaining the prior written consent of the other Party, such consent not to be unreasonably withheld, it being understood that the consent of a Third Party Licensor of a Party, or the relevant Sandoz Affiliate pursuant to the Existing US Lovenox Agreement, may also be required in order to settle or compromise such Invalidity Claim.

 

8.7.          Obligations to Licensors.  Notwithstanding anything to the contrary in this Article 8, the terms of this Article 8 are subject to and limited by the provisions of any applicable agreement with Third Party Licensors, including, as applicable, the MIT Agreement, and the limitations imposed by the Existing US Lovenox Agreement. Neither Party shall amend any such Third Party license agreement existing as of the Effective Date (including, without limitation, the MIT Agreement) in a manner that would be inconsistent with the terms of this Agreement, nor

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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enter into any agreement after the Effective Date that would be inconsistent with the terms of this Agreement.

 

8.8.          Patent Marking.  Sandoz shall, and shall cause its Affiliates and distributors, to (a) mark each Product that is manufactured, offered for sale, sold or imported under this Agreement with the number of each issued patent under Momenta IP, Sandoz IP or Joint Collaboration IP that applies to such Product and (b) comply with the patent marking statutes in each country in which such Product is manufactured by or on behalf of Sandoz or its Affiliates.

 

9.        WARRANTIES

 

9.1.          Representations and Warranties of the Parties.  Except [**], each of Momenta, on the one hand, and Sandoz, on the other hand, (the “Representing Party”) represents and warrants, or covenants, to Sandoz and Momenta, respectively, as of the Effective Date that:

 

9.1.1.       The Representing Party is a corporation duly organized, validly existing and in good standing under the laws of its state of incorporation or foreign jurisdiction;

 

9.1.2.       The Representing Party has the requisite corporate power and authority to execute and deliver this Agreement and to perform all of its obligations hereunder.  The execution and delivery of this Agreement and the performance by the Representing Party of its obligations hereunder have been authorized by all requisite corporate action on its part.  This Agreement has been validly executed and delivered by the Representing Party, and, assuming that such document has been duly authorized, executed and delivered by the other Party, constitutes a valid and binding obligation of the Representing Party, enforceable against such Party in accordance with its terms;

 

9.1.3.       Except as otherwise set forth in this Agreement or the Stock Purchase Agreement, no material filing with, and no material permit, authorization, consent or approval of, any governmental authority is necessary for the consummation by the Representing Party of the transactions contemplated by this Agreement, except for those filings, permits, authorizations, consents or approvals, the failure of which to be made or obtained would not materially impair such Party’s ability to consummate the transactions contemplated hereby or materially delay the consummation of the transactions contemplated hereby;

 

9.1.4.       The execution and delivery of this Agreement by the Representing Party and the performance by such Party of its obligations hereunder, will not (a) violate the certificate of incorporation, by-laws or other organizational document of such Party; (b) conflict in any material respect with or result in a material violation or breach of, or constitute a material default under, any material contract, agreement or instrument to which such Party is bound, or result in the creation or imposition of any material lien upon the Products; or (c) violate or conflict in any material respect with any material law, rule, regulation, judgment, order or decree of any court or governmental authority applicable to such Party or the Products;

 

9.1.5.       The Representing Party has the full power and right to grant to the relevant Party the license rights set forth in Article 2 and Section 11.7, free of any liens or

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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encumbrances (other than the rights of any Third Party Licensors therein and subject to Section 2.5);

 

9.1.6.       Excepting the pending case [**] to the extent it might concern the practice of the Momenta IP and/or the Sandoz IP with respect to a Product, the Representing Party has not, as of the Effective Date, received any notice from any Third Party that the practice of the Momenta IP with respect to a Product, if the Representing Party is Momenta, or the practice of the Sandoz IP with respect to a Product, if the Representing Party is Sandoz, infringes any patent or other proprietary rights of any Third Party, and the Representing Party has, as of the Effective Date, no knowledge that any Third Party patent or proprietary rights are infringed as of the Effective Date by the practice by Momenta of the Momenta IP with respect to a Product, if the Representing Party is Momenta, or by the practice by Sandoz of the Sandoz IP with respect to a Product, if the Representing Party is Sandoz;

 

9.1.7.       To the Representing Party’s knowledge, as of the Effective Date, there are no interferences or oppositions pending before any court or administrative office or agency relating to the Momenta IP, if the Representing Party is Momenta, or Sandoz IP, if the Representing Party is Sandoz;

 

9.1.8.       Excepting the pending case [**] to the extent it might concern the Momenta IP and/or the Sandoz IP, to the Representing Party’s knowledge, as of the Effective Date, all issued patents in the Momenta IP, if the Representing Party is Momenta, or Sandoz IP, if the Representing Party is Sandoz, are valid and enforceable and have not been challenged in any judicial or administrative proceeding; and

 

9.1.9.       There is no action or proceeding pending or, insofar as the Representing Party knows as of the Effective Date, threatened against the Representing Party before any court, administrative agency or other tribunal that might have a material adverse effect on the Representing Party’s performance of this Agreement.

 

9.2.          No Reliance by Third Parties.  The representations, warranties and covenants of a Party set forth in this Agreement are intended for the sole and exclusive benefit of the other Party and the Indemnified Parties, and may not be relied upon by any Third Party other than the Indemnified Parties, and may only be relied on by the Indemnified Parties for purposes of their indemnity hereunder.

 

9.3.          No Other Warranties.  Nothing in this Agreement shall be construed as a representation made or warranty given by any Party that (a) any patents will issue based on pending patent applications, (b) any pending patent applications or patents issued thereon will be valid, or (c) no Third Party will bring a claim against Sandoz, Momenta or any of their Affiliates or licensees claiming infringement or misappropriation of such Third Party’s Patent Rights, Know-How or confidential information.  EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN THIS AGREEMENT, EACH PARTY EXPRESSLY DISCLAIMS, WAIVES, RELEASES AND RENOUNCES ANY WARRANTY, EXPRESS OR IMPLIED, INCLUDING, WITHOUT LIMITATION, ANY WARRANTY OF TITLE, NON-INFRINGEMENT, MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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10.                               CONFIDENTIALITY

 

10.1.        Prior Confidentiality Agreements.  Momenta and Affiliates of Sandoz are parties to the Prior Confidentiality Agreements.  The following shall be considered Confidential Information hereunder, subject to the exceptions in Section 1.21:  (a) all Confidential Information (as that term is defined in the Biochemie CDA) relating to the Products disclosed pursuant to the Biochemie CDA, (b) all Proprietary Information (as that term is defined in the Geneva CDA), relating to the Products disclosed pursuant to the Geneva CDA, and (c) the Position Statements (as that term is defined in one or more of the Community of Interest Letters and Agreements) and other information deemed confidential pursuant to the Community of Interest Letters and Agreements, which, notwithstanding anything to the contrary herein, shall also remain subject to the provisions of (y) Section 3 of the particular Community of Interest Letters and Agreements dated [**] and (z) the particular Community of Interest Letter and Agreement dated [**].  The terms of this Agreement shall be deemed to be Confidential Information of each Party, subject to the exceptions in Section 1.21, for purposes of this Agreement.

 

10.2.        Confidential Information.  Each of Sandoz and Momenta (the “Receiving Party”) shall keep strictly confidential any Confidential Information disclosed by any other Party (the “Disclosing Party”), using at least the same degree of care that it uses to protect its own confidential or proprietary information but in no event less than reasonable care.

 

10.3.        Nondisclosure of Confidential Information.  The Receiving Party shall use the Disclosing Party’s Confidential Information solely for the purposes of this Agreement and the transactions contemplated hereby and shall not disclose or disseminate any such Confidential Information to any Person at any time, except for disclosure to those of its Affiliates, directors, officers, employees, consultants, accountants, attorneys, advisers and agents that have a need to know such information to permit the Receiving Party to exercise its rights or fulfill its obligations pursuant to this Agreement, provided that such Persons are bound to maintain the confidentiality of such Confidential Information to the same extent as if they were parties hereto.

 

10.4.        Exceptions.  The foregoing confidentiality and nondisclosure obligations are subject to the following exceptions:

 

10.4.1.     The Receiving Party may disclose the Disclosing Party’s Confidential Information that is required to be publicly disclosed by law, regulation or legal process (including, without limitation, the rules or regulations of the United States Securities and Exchange Commission or similar regulatory agency in a country other than the United States, or the rules or regulations of any stock exchange (including, without limitation, Nasdaq)); provided, however, that the Receiving Party shall (a) use Commercially Reasonable efforts to ensure that it discloses the minimum amount of the Disclosing Party’s Confidential Information necessary to comply with law, (b) where possible, seek confidential treatment for any such information which is disclosed to a governmental agency or group, and (c) provide the Disclosing Party with prior notice of such disclosure (to the extent permissible).

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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10.4.2.     Pursuant to an agreement or professional responsibility to maintain confidentiality, any Party may discuss the terms of this Agreement with, or provide a copy of this Agreement to, its independent public accountants or its attorneys.

 

10.4.3.     Pursuant to an agreement to maintain confidentiality, Momenta may provide a copy of this Agreement or relevant portions thereof, to MIT and any other Third Party Licensor, if and to the extent required pursuant to the relevant license agreement with respect to Momenta IP.

 

10.4.4.     Any other disclosure of the terms of this Agreement (including, without limitation, any public announcements, press releases, discussions, interviews or similar publicity with respect to this Agreement) by Momenta or Sandoz must be approved in advance in writing by Sandoz or Momenta, respectively, as to form and content of such disclosure; provided, however, that the contents of any public announcement, press release or similar publicity which has been reviewed and approved by the reviewing Party can be re-released by either Party in any form without a requirement for re-approval.

 

10.5.        Identification.  In any disclosure by Sandoz permitted hereunder which refers to Momenta IP or the Joint Collaboration IP, Sandoz shall identify Momenta as the inventor, co-inventor, originator, owner, co-owner and/or licensee, as appropriate, of such Momenta IP or Joint Collaboration IP.  In any disclosure by Momenta permitted hereunder which refers to Sandoz IP or Joint Collaboration IP, Momenta shall identify Sandoz as the inventor, co-inventor, originator, owner, co-owner and/or licensee, as appropriate, of such Sandoz IP or Joint Collaboration IP.

 

10.6.        Equitable Relief.  The Receiving Party agrees that any breach of this Article 10 may cause the Disclosing Party substantial and irreparable injury and, therefore, in the event of any such breach, in addition to other remedies that may be available, the Disclosing Party shall have the right to specific performance and other injunctive and equitable relief.

 

10.7.        Survival.  The confidentiality and nondisclosure obligations of this Article 10 shall survive the expiration or termination of this Agreement and remain in effect for a period of ten (10) years following the expiration or termination of this Agreement.  For the sake of clarity, if any item of “Confidential Information” (as defined in the Existing US Lovenox Agreement) is also considered Confidential Information hereunder, then, to the extent that any provision of Article 10 of the Existing US Lovenox Agreement conflicts with any provision of Article 10 in this Agreement, then such provision in this Article 10 shall control and, for the sake of clarity, such Confidential Information shall be protected for the longer of ten (10) years following the expiration or termination of this Agreement or of the Existing US Lovenox Agreement.

 

11.                               TERM & TERMINATION

 

11.1.        Term.  The term of this Agreement (the “Term”) shall begin on the Effective Date and continue throughout the Development and Commercialization of the Products until the last sale of the Products by Sandoz, its Affiliates or distributors, or sublicensees approved by the

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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Parties, anywhere in the relevant Territory, unless earlier terminated by either Party pursuant to the provisions of this Agreement.

 

11.2.       Termination For Cause.

 

11.2.1.     Either Party may terminate this Agreement, in whole or, in its discretion, solely with respect to the relevant Product if the relevant breach relates to such Product, upon ninety (90) days’ prior written notice to the other Party upon any material breach of this Agreement by such other Party; provided that such termination shall become effective only if such other Party fails to cure such breach within [**] days after receiving such notice.  If Sandoz shall terminate a Glycoprotein Product pursuant to this Section 11.2.1, Sandoz may specify in the notice of termination that it chooses to retain the licenses granted to Sandoz under Article 2 with respect to the terminated Glycoprotein Product.

 

11.2.2.     To the extent permitted under applicable law, either Party may terminate this Agreement effective immediately with written notice if the other Party shall file for bankruptcy, shall be adjudicated bankrupt, shall file a petition under insolvency laws, shall be dissolved or shall have a receiver appointed for substantially all of its property.

 

11.3.        Need for Clinical Trials for Collaboration Products.  Each Party may terminate this Agreement with respect to the Collaboration Products, on a Product-by-Product and Region-by-Region basis, upon ninety (90) days’ prior written notice to the other Party provided to such other Party within sixty (60) days after (a) receipt of written correspondence from the applicable Regulatory Authority with respect to such Region specifying that such Product will not receive Marketing Approval in such Region without conducting clinical studies (other than bioequivalence studies) or (b) the reasonable determination by the JSC that clinical studies (other than bioequivalence studies) will be required in order for such Product to receive Marketing Approval in such Region; provided, however, that such Party may terminate this Agreement with respect to all Regions for the Copaxone-Referenced Product if the relevant Region for which such correspondence is received or for which the JSC makes such determination is the U.S. Territory.  If one Party provides notice to the other Party of a termination pursuant to this Section 11.3, the other Party shall have thirty (30) days thereafter to provide equivalent notice of termination for such reason to the first Party, in which case the Parties will be considered to have jointly terminated such Product with respect to the relevant Region(s).

 

11.4.        Sandoz Termination of Glycoprotein Products.  With respect to each Glycoprotein Product, Sandoz may terminate this Agreement with respect to such Glycoprotein Product:

 

11.4.1.     for convenience upon ninety (90) days’ prior written notice to Momenta, which notice may be provided to Momenta no sooner than fifteen (15) months, and no later than (21) months, after the MOU Effective Date, so that such termination is effective between eighteen (18) and twenty-four (24) months after the MOU Effective Date;

 

11.4.2.     if, in the reasonable determination of the Parties, as documented in writing, the Momenta IP does not and will not materially contribute to the achievement of

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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Marketing Approval or Full-Substitutability for such Glycoprotein Product in the relevant Territory; provided, however, that once any Momenta IP is used in a regulatory filing for such Glycoprotein Product that has been filed by Sandoz, its Affiliates or sublicensees with a Regulatory Authority in the relevant Territory, the termination right pursuant to this Section 11.4.2 shall automatically expire;

 

11.4.3.     upon ninety (90) days’ prior written notice to Momenta if the Regulatory Authority for the relevant Territory states in writing that the Momenta IP did not contribute to the Marketing Approval of such Glycoprotein Product;

 

11.4.4.     on ninety (90) days’ prior written notice to Momenta upon Sandoz’s decision to permanently cease development and commercialization of such Glycoprotein Product and of the relevant Related Products; or

 

11.4.5.     on ninety (90) days’ prior written notice to Momenta if, following a Change in Control of Momenta, there occurs the continuous neglect by Momenta of its material obligations under the Annual Collaboration Plan with respect to such Glycoprotein Product which has a material adverse effect on the development and/or commercialization of such Glycoprotein Product.  If Sandoz shall terminate a Glycoprotein Product pursuant to this Section 11.4.5, Sandoz may specify in the notice of termination that it chooses to retain the licenses granted to Sandoz under Article 2 with respect to the terminated Glycoprotein Product.

 

11.5.        Momenta Termination of Glycoprotein Products.  With respect to each Glycoprotein Product, Momenta may terminate this Agreement with respect to such Glycoprotein Product on ninety (90) days’ prior written notice to Sandoz if, following a Change in Control of Sandoz, there occurs the continuous neglect by Sandoz of its material obligations under the Annual Collaboration Plan with respect to such Glycoprotein Product which has a material adverse effect on the development and/or commercialization of such Glycoprotein Product.  If Momenta shall terminate a Glycoprotein Product pursuant to this Section 11.5, Momenta may specify in the notice of termination that it chooses to retain the licenses granted to Momenta under Article 2 with respect to the terminated Glycoprotein Product.

 

11.6.        Interpretation.  In the event that this Agreement has been terminated with respect to all Products, this Agreement shall terminate in its entirety (subject to Sections 11.7 and 11.8).  For the sake of clarity, in the event that this Agreement is terminated in its entirety, all Products shall be considered terminated Products for purposes of Section 11.7.

 

11.7.       Effects of Termination.

 

11.7.1.     With respect to the Collaboration Products, if this Agreement is terminated (in its entirety or with respect to a Collaboration Product, as applicable), except as provided in Section 11.7.2,

 

11.7.1.a.  all licenses granted by Momenta to Sandoz with respect to such terminated Product(s) (limited to the relevant Region, with respect to a termination pursuant to Section 11.3 for the Copaxone-Referenced Product in less than all Regions) shall terminate;

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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11.7.1.b.  all licenses granted by Sandoz to Momenta under Article 2 with respect to such terminated Product(s) (in such Region, if applicable) shall remain in effect on an irrevocable, perpetual and sublicenseable (provided that such sublicensees comply with the relevant provisions of this Agreement) basis, and Sandoz hereby grants to Momenta an irrevocable, perpetual, exclusive, royalty-free, sublicenseable (provided that such sublicensees comply with the relevant provisions of this Agreement) license, under Sandoz IP and under Sandoz’s rights in the Joint Collaboration IP, to sell, offer to sell and otherwise Commercialize such terminated Product(s) in the relevant Territory (or in such Region, if applicable) in the Field (which license Momenta shall not exercise until such termination of this Agreement);

 

11.7.1.c.  Sandoz shall cease to use and shall assign to Momenta all of its right, title and interest in and to all clinical, technical and other related reports, records, data, information and materials and all regulatory filings and Marketing Approvals relating to such terminated Product(s) in the Field in the relevant Territory (or such Region, as applicable) (and Sandoz shall deliver to Momenta, at Sandoz’s expense, one (1) copy of each physical embodiment of the aforementioned items within thirty (30) days after such termination);

 

11.7.1.d.  Sandoz shall cease to use in the Field any technology arising out of the Collaborative Program, including, without limitation, any manufacturing processes, to develop, manufacture or commercialize such terminated Product(s);

 

11.7.1.e.  Sandoz shall promptly return to Momenta all materials and records in its possession or control containing Confidential Information of Momenta which solely relates to such terminated Product(s) (or such Product(s) only with respect to the terminated Regions, if applicable);

 

11.7.1.f.   Sandoz shall transfer and assign to Momenta all trademarks and tradenames of such terminated Product(s) that have received Marketing Approval in the relevant Territory (or Region, as applicable) in the Field, except for any such trademarks or tradenames or a part thereof that use the name “Sandoz” or a derivative thereof or any other trademark or tradename or part or derivative thereof that is the name or derivative of a name of any Sandoz Affiliate;

 

11.7.1.g.  if so requested by Momenta, Sandoz shall, at Sandoz’s expense, take reasonable steps to assist Momenta in establishing a contract manufacturing relationship with its suppliers (if any) of such terminated Product(s), it being understood that Sandoz in no way guarantees the ability to transfer any such relationship to Momenta;

 

11.7.1.h.  at Momenta’s request, Sandoz shall sell to Momenta at the Cost of Goods Sold all units, whether in finished product or work-in-process

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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form, in its inventory of such terminated Product(s) for sale in or into the relevant Territory (or Region, as applicable);

 

11.7.1.i.   subject to any Prior Obligations of Sandoz, Sandoz shall continue to use Commercially Reasonable efforts to timely prepare, file, prosecute and maintain, at its expense, Sandoz Patent Rights and Sandoz Collaboration Patent Rights in the Field in the relevant Territory (or Region, if applicable) to the extent reasonably necessary for the Development and Commercialization of such terminated Product(s) in the Field in the Territory (or Region, if applicable); provided, however, that if Sandoz declines to file, prosecute or maintain any such Patent Right or if Sandoz elects to allow any such Patent Right to lapse or elects to abandon any such Patent Right before all appeals within the respective patent office have been exhausted, then, subject to any Prior Obligations of Sandoz, (1) Momenta shall have the right, at its own expense and upon written notice to Sandoz, to assume control of the filing, prosecution and maintenance of such Patent Right in Sandoz’s name or the name of its Third Party Licensor, as applicable, in which event, Sandoz shall provide assistance (including the execution of all necessary documents and instruments) to and cooperate with Momenta in prosecuting the subject Patent Right, should Momenta elect to prosecute and maintain the subject Patent Right, and (2) Sandoz shall provide Momenta with reasonable notice of its decision to decline to file, prosecute or maintain any such Patent Right or its election to allow any such Patent Right to lapse or its election to abandon any such Patent Right so as to permit Momenta (A) to review the patent or application, (B) to decide whether to prosecute or maintain the same, and (C) to take appropriate action to prosecute or maintain the patent application or patent;

 

11.7.1.j.   the provisions of Sections 8.4, 8.5 and 8.6 (except that Momenta, rather than the JOC, shall determine the appropriate course of action, subject to Sandoz’ rights in accordance with the general concepts of Section 8.4), and Section 8.7 shall continue to apply with respect to Sandoz Patent Rights and Sandoz Collaboration Patent Rights in the Field in the relevant Territory (or Region, if applicable), to the extent reasonably necessary for the Development and Commercialization of such terminated Product(s) in the Field in the relevant Territory (or Region, if applicable).

 

The post-termination license rights granted to Momenta in Section 11.7.1(b) shall apply only as to any Sandoz IP and Joint Collaboration IP existing as of the date of such termination of this Agreement that (i) has actually been used in the Collaborative Program with respect to such terminated Product(s) prior to the date of such termination of this Agreement or (ii) is otherwise necessary or reasonably useful for the Development and Commercialization of such terminated Product(s) in the Field in the relevant Territory (or Region, if applicable), and shall expressly exclude any other Sandoz IP and any other Joint Collaboration IP.

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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11.7.2.     With respect to the Collaboration Products, in the event of termination of this Agreement (in its entirety or with respect to a Collaboration Product, as applicable) by Sandoz pursuant to Section 11.2 or solely by Momenta pursuant to Section 11.3,

 

11.7.2.a.  all licenses granted by Sandoz to Momenta with respect to such terminated Product(s) (limited to the relevant Region, with respect to a termination pursuant to Section 11.3 for the Copaxone-Referenced Product in less than all Regions) shall terminate;

 

11.7.2.b.  all licenses granted by Momenta to Sandoz under Article 2 with respect to such terminated Product(s) (in such Region, if applicable) shall remain in effect on an irrevocable, perpetual and sublicenseable (provided that such sublicensees comply with the relevant provisions of this Agreement) basis;

 

11.7.2.c.  Momenta shall cease to use and shall assign to Sandoz all of its right, title and interest in and to all clinical, technical and other related reports, records, data, information and materials and all regulatory filings and Marketing Approvals relating to such terminated Product(s) in the Field in the relevant Territory (or Region, if applicable) (and Momenta shall deliver to Sandoz, at Momenta’s expense, one (1) copy of each physical embodiment of the aforementioned items within thirty (30) days after such termination);

 

11.7.2.d.  Momenta shall promptly return to Sandoz all materials and records in Momenta’s possession or control containing Confidential Information of Sandoz which solely relates to such terminated Product(s) (or such Product(s) only with respect to the terminated Regions, if applicable);

 

11.7.2.e.  Momenta shall transfer and assign to Sandoz all trademarks and tradenames of such terminated Product(s) that have received Marketing Approval in the relevant Territory (or Region, if applicable) in the Field, except for any such trademarks or tradenames or a part thereof that use the name “Momenta” or a derivative thereof or any other trademark or tradename or part or derivative thereof that is the name or derivative of a name of any Momenta Affiliate;

 

11.7.2.f.   subject to any Prior Obligations of Momenta, Momenta shall continue to use Commercially Reasonable efforts to timely prepare, file, prosecute and maintain, at its expense, Momenta Patent Rights and Momenta Collaboration Patent Rights in the Field in the relevant Territory (or Region, if applicable) to the extent reasonably necessary for the Development and Commercialization of such terminated Product(s) in the Field in the Territory (or Region, if applicable); provided, however, that if Momenta declines to file, prosecute or maintain any such Patent Right or if Momenta elects to allow any such Patent Right to lapse or elects to abandon any such Patent Right before all appeals within the respective patent office have been exhausted, then, subject to any Prior Obligations of Momenta, (1) Sandoz shall have the right, at its own expense and upon written notice to Momenta, to assume control of the filing,

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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prosecution and maintenance of such Patent Right in Momenta’s name or the name of its Third Party Licensor, as applicable, in which event, Momenta shall provide assistance (including the execution of all necessary documents and instruments) to and cooperate with Sandoz in prosecuting the subject Patent Right, should Sandoz elect to prosecute and maintain the subject Patent Right, and (2) Momenta shall provide Sandoz with reasonable notice of its decision to decline to file, prosecute or maintain any such Patent Right or its election to allow any such Patent Right to lapse or its election to abandon any such Patent Right so as to permit Sandoz (A) to review the patent or application, (B) to decide whether to prosecute or maintain the same, and (C) to take appropriate action to prosecute or maintain the patent application or patent;

 

11.7.2.g.  the financial and related payment obligations of Sandoz with respect to such terminated Product(s) with respect to such Territory (or Region, if applicable) set forth in Article 4, each as applicable, shall remain in effect, except that, (i) if such termination was due to Momenta’s breach of the exclusive rights and licenses granted, or the exclusivity obligations owed, to Sandoz pursuant to Sections 2.1 and 2.3, then the relevant payment obligations shall terminate as of the date of such termination, and (ii) if such termination is by Momenta alone pursuant to Section 11.3, Sandoz may offset from the Profit Interest due to Momenta with respect to such terminated Product one hundred fifty percent (150%) of the actual costs of clinical studies (other than bioequivalence studies) with respect to such terminated Product for such Territory (or Region, if applicable), which would otherwise have been borne by Momenta pursuant to Section 4.1.1 had this Agreement not be so terminated with respect to such Product for such Region(s);

 

11.7.2.h.  the patent marking obligations set forth in Section 8.8, and the insurance obligations of Section 12.6 shall remain in effect;

 

11.7.2.i.   for as long as Sandoz is marketing such terminated Product(s) and abiding by its financial obligations to Momenta pursuant to Section 11.7.2(g), Momenta shall not provide any Patent Rights, Know-How or any other assistance to any Third Party to Characterize, develop, produce, manufacture or Commercialize the relevant Reference-Equivalent Product(s) in the Field in the relevant Territory (or Region, if applicable); and

 

11.7.2.j.   the provisions of Sections 8.4, 8.5 and 8.6 (except that Sandoz, rather than the JOC, shall determine the appropriate course of action, subject to Momenta’s rights in accordance with the general concepts of Section 8.4), and Section 8.7 shall continue to apply with respect to Momenta Patent Rights and Momenta Collaboration Patent Rights in the Field in the relevant Territory (or Region, as applicable), to the extent reasonably necessary for the Development and Commercialization of such terminated Product(s) in the Field in the relevant Territory (or Region, if applicable).

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

60

 

The post-termination license rights granted to Sandoz in Section 11.7.2(b) shall apply only as to any Momenta IP and Joint Collaboration IP existing as of the date of such termination of this Agreement that (i) has actually been used in the Collaborative Program with respect to such terminated Product(s) prior to the date of such termination of this Agreement, or (ii) is otherwise necessary or reasonably useful for the Development and Commercialization of such terminated Product(s) in the Field in the relevant Territory (or Region, if applicable), and shall expressly exclude any other Momenta IP and any other Joint Collaboration IP.

 

11.7.3.     With respect to the Glycoprotein Products, in the event of termination of this Agreement (in its entirety or with respect to a Glycoprotein Product, as applicable), except as provided in Section 11.7.4,

 

11.7.3.a.      all licenses granted by Sandoz to Momenta with respect to such terminated Product(s) shall terminate;

 

11.7.3.b.     all licenses granted by Momenta to Sandoz under Article 2 with respect to such terminated Product(s) shall terminate; provided, however, that, if such termination is by Sandoz pursuant to Section 11.2 or 11.4.5 and if, in its notice of termination pursuant to such Section 11.2 or 11.4.5, Sandoz elected to retain the Momenta license, then such licenses shall remain in effect on an irrevocable, perpetual and sublicenseable (provided that such sublicensees comply with the relevant provisions of this Agreement) basis;

 

11.7.3.c.      Momenta shall cease to use and shall assign to Sandoz all of its right, title and interest in and to all clinical, technical and other related reports, records, data, information and materials and all regulatory filings and Marketing Approvals relating to such terminated Product(s) in the Field in the relevant Territory (and Momenta shall deliver to Sandoz, at Momenta’s expense, one (1) copy of each physical embodiment of the aforementioned items within thirty (30) days after such termination);

 

11.7.3.d.     Momenta shall promptly return to Sandoz all materials and records in its possession or control containing Confidential Information of Sandoz which solely relates to such terminated Product(s);

 

11.7.3.e.      Momenta shall transfer and assign to Sandoz all trademarks and tradenames of such terminated Product(s) that have received Marketing Approval in the relevant Territory in the Field, except for any such trademarks or tradenames or a part thereof that use the name “Momenta” or a derivative thereof or any other trademark or tradename or part or derivative thereof that is the name or derivative of a name of any Momenta Affiliate;

 

11.7.3.f.      to the extent that Sandoz retained Momenta licenses pursuant to Section 11.7.3(b), subject to any Prior Obligations of Momenta, Momenta shall continue to use Commercially Reasonable efforts to timely prepare, file, prosecute and maintain, at its expense, Momenta Patent Rights and

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

61

 

Momenta Collaboration Patent Rights in the Field in the relevant Territory to the extent reasonably necessary for the Development and Commercialization of such terminated Product(s) in the Field in the Territory; provided, however, that if Momenta declines to file, prosecute or maintain any such Patent Right or if Momenta elects to allow any such Patent Right to lapse or elects to abandon any such Patent Right before all appeals within the respective patent office have been exhausted, then, subject to any Prior Obligations of Momenta, (1) Sandoz shall have the right, at its own expense and upon written notice to Momenta, to assume control of the filing, prosecution and maintenance of such Patent Right in Momenta’s name or the name of its Third Party Licensor, as applicable, in which event, Momenta shall provide assistance (including the execution of all necessary documents and instruments) to and cooperate with Sandoz in prosecuting the subject Patent Right, should Sandoz elect to prosecute and maintain the subject Patent Right, and (2) Momenta shall provide Sandoz with reasonable notice of its decision to decline to file, prosecute or maintain any such Patent Right or its election to allow any such Patent Right to lapse or its election to abandon any such Patent Right so as to permit Sandoz (A) to review the patent or application, (B) to decide whether to prosecute or maintain the same, and (C) to take appropriate action to prosecute or maintain the patent application or patent;

 

11.7.3.g.     the patent marking obligations set forth in Section 8.8, and the insurance obligations of Section 12.6 shall remain in effect;

 

11.7.3.h.     the provisions of Sections 8.4, 8.5 and 8.6 (except that Sandoz, rather than the JOC, shall determine the appropriate course of action, subject to Momenta’s rights in accordance with the general concepts of Section 8.4), and Section 8.7 shall continue to apply with respect to Momenta Patent Rights and Momenta Collaboration Patent Rights in the Field in the relevant Territory, to the extent reasonably necessary for the Development and Commercialization of such terminated Product(s) in the Field in the relevant Territory;

 

11.7.3.i.       if this Agreement was terminated pursuant to Section 11.4.4, Sandoz shall no longer, and shall ensure that its Affiliates will no longer, develop or commercialize such terminated Product(s) or the relevant Related Product anywhere in the world, alone or with or through Third Parties; and

 

11.7.3.j.       except for any payments owed to Momenta as of the relevant date of termination or expiration, Sandoz will not owe any further Profit Interest or milestone payments to Momenta with respect to such terminated Product(s) in the relevant Territory.

 

The post-termination license rights granted to Sandoz in Section 11.7.3(b) shall apply only as to any Momenta IP that has actually been used in the Collaborative Program prior to the date of termination of this Agreement, and shall expressly exclude any other Momenta IP.

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

62

 

11.7.4.     With respect to the Glycoprotein Products, in the event of termination of this Agreement with respect to a Glycoprotein Product by Momenta pursuant to Section 11.5,

 

11.7.4.a.      all licenses granted by Momenta to Sandoz with respect to such terminated Product(s) shall terminate;

 

11.7.4.b.     all licenses granted by Sandoz to Momenta under Article 2 with respect to such terminated Product(s) shall terminate; provided, however, that, if, in its notice of termination pursuant to Section 11.5, Momenta elected to retain the Sandoz license, then such licenses shall remain in effect on an irrevocable, perpetual and sublicenseable (provided that such sublicensees comply with the relevant provisions of this Agreement) basis;

 

11.7.4.c.      Sandoz shall cease to use and shall assign to Momenta all of its right, title and interest in and to all clinical, technical and other related reports, records, data, information and materials and all regulatory filings and Marketing Approvals relating to such terminated Product(s) in the Field in the relevant Territory (and Sandoz shall deliver to Momenta, at Sandoz’ expense, one (1) copy of each physical embodiment of the aforementioned items within thirty (30) days after such termination);

 

11.7.4.d.     Sandoz shall promptly return to Momenta all materials and records in its possession or control containing Confidential Information of Momenta which solely relates to such terminated Product(s);

 

11.7.4.e.      Sandoz shall transfer and assign to Momenta all trademarks and tradenames of such terminated Product(s) that have received Marketing Approval in the relevant Territory in the Field, except for any such trademarks or tradenames or a part thereof that use the name “Sandoz” or a derivative thereof or any other trademark or tradename or part or derivative thereof that is the name or derivative of a name of any Sandoz Affiliate;

 

11.7.4.f.      to the extent that Momenta retained Sandoz licenses pursuant to Section 11.7.4(b), subject to any Prior Obligations of Sandoz, Sandoz shall continue to use Commercially Reasonable efforts to timely prepare, file, prosecute and maintain, at its expense, Sandoz Patent Rights and Sandoz Collaboration Patent Rights in the Field in the relevant Territory to the extent reasonably necessary for the Development and Commercialization of such terminated Product(s) in the Field in the Territory; provided, however, that if Sandoz declines to file, prosecute or maintain any such Patent Right or if Sandoz elects to allow any such Patent Right to lapse or elects to abandon any such Patent Right before all appeals within the respective patent office have been exhausted, then, subject to any Prior Obligations of Sandoz, (1) Momenta shall have the right, at its own expense and upon written notice to Sandoz, to assume control of the filing, prosecution and maintenance of such Patent Right in Sandoz’s name or the name of its Third Party Licensor, as applicable, in which event, Sandoz shall

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

63

 

provide assistance (including the execution of all necessary documents and instruments) to and cooperate with Momenta in prosecuting the subject Patent Right, should Momenta elect to prosecute and maintain the subject Patent Right, and (2) Sandoz shall provide Momenta with reasonable notice of its decision to decline to file, prosecute or maintain any such Patent Right or its election to allow any such Patent Right to lapse or its election to abandon any such Patent Right so as to permit Momenta (A) to review the patent or application, (B) to decide whether to prosecute or maintain the same, and (C) to take appropriate action to prosecute or maintain the patent application or patent;

 

11.7.4.g.     the patent marking obligations set forth in Section 8.8, and the insurance obligations of Section 12.6 shall remain in effect;

 

11.7.4.h.     the provisions of Sections 8.4, 8.5 and 8.6 (except that Momenta, rather than the JOC, shall determine the appropriate course of action, subject to Sandoz’s rights in accordance with the general concepts of Section 8.4), and Section 8.7 shall continue to apply with respect to Sandoz Patent Rights and Sandoz Collaboration Patent Rights in the Field in the relevant Territory, to the extent reasonably necessary for the Development and Commercialization of such terminated Product(s) in the Field in the relevant Territory; and

 

11.7.4.i.       except for any payments owed to Sandoz as of the relevant date of termination or expiration, Momenta will not owe any other payments to Sandoz with respect to such terminated Product(s) in the relevant Territory.

 

The post-termination license rights granted to Momenta in Section 11.7.4(b) shall apply only as to any Sandoz IP that has actually been used in the Collaborative Program prior to the date of termination of this Agreement, and shall expressly exclude any other Sandoz IP.

 

11.8.        Survival.  Upon expiration or termination of this Agreement for any reason, (a) nothing in this Agreement shall be construed to release either Party from any obligations that were incurred prior to the effective date of expiration or termination; (b) the following provisions shall expressly survive any such expiration or termination:  Articles 1, 10 and 14, Article 3 with respect to any then-current Sandoz MFN Projects (to the extent that the Agreement has terminated as a result of a breach by Momenta under Section 11.2), Sections 2.1.2, 2.4, 2.5 (to the extent applicable to the licenses which survive termination), 2.6, 4.4 (as applicable), 8.1.1, 8.1.2, 8.1.3, 8.1.4, 8.2.3 (with respect to all Joint Collaboration Patent Rights, for which all out-of-pocket costs shall be borne equally by the Parties), 9.3, 11.7 (as applicable), 11.8, 11.9, 13.2, 13.3; and (c) (i) the obligations to indemnify under Sections 12.1 and 12.2 (subject to Sections 12.3, 12.4 and, if applicable, 12.5) shall survive the expiration or termination of this Agreement with respect to any Liabilities, whether asserted during or after the Term, that result from activities that occurred before or during the Term (including the determination of the strategy to achieve Legal Clearance), (ii) subject to Section 11.8(c)(i), the obligations of Momenta to indemnify Sandoz Indemnified Parties under Section 12.2 (subject to Sections 12.3 and 12.4) shall survive the expiration or termination of this Agreement with respect to any Liabilities that result from activities that occur after the Term pursuant to Section 11.7.1, (iii) subject to Section 11.8(c)(i),

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

64

 

the obligations of Sandoz to indemnify the Momenta Indemnified Parties under Section 12.1 (subject to Sections 12.3, 12.4 and, if applicable, Section 12.5) shall survive the expiration or termination of this Agreement with respect to any Liabilities that result from activities that occur after the Term pursuant to Section 11.7.2 or 11.7.3, and (iv) otherwise there shall be no continuing obligation of the Indemnifying Party to indemnify, defend or hold harmless the Indemnified Party after the date of expiration or termination of this Agreement; and (c) each Party shall promptly return to the other Party all materials and records in its possession or control containing Confidential Information of such other Party, except to the extent necessary to exercise rights under the licenses retained pursuant to Section 11.7.1(b), 11.7.2(b), 11.7.3(b) or 11.7.4(b), as applicable.

 

11.9.        Non-Exclusive Remedy.  Termination of this Agreement shall be in addition to, and shall not prejudice, the Parties’ remedies at law or in equity, including, without limitation, the Parties’ ability to receive legal damages and/or equitable relief with respect to any breach of this Agreement, regardless of whether or not such breach was the reason for the termination.

 

12.                               INDEMNIFICATION

 

12.1.        Sandoz Indemnification of Momenta.  Sandoz shall indemnify, defend and hold harmless the Momenta Indemnified Parties from and against all losses, costs, damages, judgments, settlements, interest, fees or expenses (including all reasonable attorneys’ fees, experts’ or consultants’ fees, expenses and costs) (“Liabilities”) awarded to a Third Party against any Momenta Indemnified Party, or that may be incurred or paid by any Momenta Indemnified Party in the defense or compromise of legal or equitable claims asserted by a Third Party, arising out of or resulting from (a) any breach of any representation, warranty, covenant, obligation or agreement by Sandoz hereunder, (b) any misrepresentation by Sandoz hereunder (including but not limited to any such breach by Sandoz of Article 9 – Warranties), (c) any Patent Litigation, (d) any property damage or personal injury (including, without limitation, death) resulting from the development, use, manufacture, sale, offering for sale or importation of a Product by Sandoz, its Affiliates or their Third Party contractors or distributors or other actual or alleged product liability with respect to such Product, or (e) any claims or demands related to a Product that are commenced by the relevant Innovator or any Third Party against any Momenta Indemnified Party based on the activities of Momenta or Sandoz (including those undertaken by Affiliates or Third Parties on behalf of Momenta or Sandoz) prior to the Effective Date or pursuant to this Agreement; provided, however, that Sandoz shall have no obligation to indemnify the Momenta Indemnified Parties against Liabilities under (a) through (e) to the extent that such Liabilities arise from any Third Party legal or equitable claim that is subject to Momenta’s obligation to indemnify, defend, and hold Sandoz Indemnified Parties harmless under Section 12.2.

 

12.2.        Momenta Indemnification of Sandoz.  Momenta shall indemnify, defend and hold harmless Sandoz Indemnified Parties from and against all Liabilities awarded to a Third Party against Sandoz Indemnified Parties or that may be incurred or paid by any of Sandoz Indemnified Parties in the defense or compromise of legal or equitable claims asserted by a Third Party, arising out of or resulting from (a) any breach of any representation, warranty, covenant, obligation or agreement by Momenta hereunder, (b) any misrepresentation by Momenta hereunder (including but not limited to any such breach by Momenta of Article 9 – Warranties),

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

65

 

or (c) any Final Misappropriation Determination with respect to a claim of misappropriation by any Momenta Indemnified Party of any Third Party trade secret or know-how.

 

12.3.        Final Misappropriation Determination.  “Final Misappropriation Determination” means, with respect to a Party, actual misappropriation by such Party or its related Indemnified Parties of any Third Party trade secret or know-how; provided that, (a) there has been a final adjudication of liability for misappropriation by a court of competent jurisdiction, or, (b) with respect to misappropriation that has been alleged but not finally adjudicated, there is a settlement with a Third Party which the Parties determine by mutual agreement constitutes an acknowledgement by such Party of actual misappropriation.  If there is a dispute between the Parties as to whether a settlement constitutes such an acknowledgement, nationally-recognized outside counsel not regularly employed by any Party or their Affiliates who is mutually acceptable to the Parties shall be retained to resolve such dispute.  In the event that a Party has, pursuant to the provisions of Section 12.1 or 12.2, incurred Liabilities with respect to an actual or alleged misappropriation by any Indemnified Party related to the other Party of any Third Party trade secret or know-how and a Final Misappropriation Determination occurs, such other Party shall, in addition to indemnifying the Indemnified Parties of such other Party for such Liabilities incurred by them pursuant to Section 12.1 or 12.2(c), as applicable, reimburse such Party for any Liabilities which such Party previously paid to or incurred on behalf of any of the misappropriating Party’s Indemnified Parties that are allocable to the misappropriation claim that gave rise to the Final Misappropriation Determination.

 

12.4.        Procedure.  If any Momenta Indemnified Party or any Sandoz Indemnified Party (in each case, an “Indemnified Party”) receives any written claim or demand which such Indemnified Party believes is the subject of indemnity hereunder by Sandoz or Momenta as the case may be (in each case, an “Indemnifying Party”), the Indemnified Party shall, as soon as reasonably practicable after forming such belief, give notice thereof to the Indemnifying Party; provided that the failure to give timely notice to the Indemnifying Party as contemplated hereby shall not release the Indemnifying Party from any liability to the Indemnified Party unless the Indemnifying Party demonstrates that the defense of such claim is materially prejudiced by such failure.  The Indemnifying Party shall assume and diligently pursue the defense of such claim, at its cost, with counsel reasonably satisfactory to the Indemnified Party.  The Indemnifying Party shall have absolute control of the conduct of the litigation; provided, however, that

 

12.4.1.     the Indemnified Party may, nevertheless, participate therein through counsel of its choice and at its cost, and shall be permitted to effectively associate with the Indemnifying Party in the defense, the prosecution and the negotiation of any settlement of the claim or demand;

 

12.4.2.     the Indemnifying Party shall keep the Indemnified Party informed, through the JSC, of the status of the litigation;

 

12.4.3.     the Indemnifying Party shall provide the Indemnified Party with a reasonable opportunity to review and comment on all pleadings, motions and other papers exchanged with the opposing party or filed with any court by the Indemnifying Party with respect to such claim or demand (collectively, the “Pleadings”) and the

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

66

 

Indemnifying Party shall consider in good faith any input provided by the Indemnified Party with respect to the Pleadings; and

 

12.4.4.     if the suit includes a defense of Momenta IP or the Joint Collaboration IP or an Invalidity Claim with respect to Momenta IP or the Joint Collaboration IP (in the event Momenta is the Indemnified Party), then the Indemnifying Party’s conduct of the litigation with respect to such claim(s) shall be subject to:

 

12.4.4.a.      the approval of Momenta (solely in relation to Momenta IP or Joint Collaboration IP); and/or

 

12.4.4.b.     any contractual obligations as of the Effective Date (or thereafter if otherwise agreed by the Parties) to, or restrictions existing as of the Effective Date (or thereafter if otherwise agreed by the Parties) imposed by, the relevant Third Party Licensor or the Existing US Lovenox Agreement.

 

The Party not assuming the defense of any such claim or demand shall render all reasonable assistance to the Party assuming such defense as requested by such defending Party, and all reasonable out-of-pocket costs of such assistance shall be for the account of the Indemnifying Party.  No such claim or demand shall be settled other than by the Party defending the same, and then only with the consent of the other Party, which shall not be unreasonably withheld; provided that the Indemnified Party shall have no obligation to consent to any settlement of any such claim which imposes on the Indemnified Party any liability or obligation which cannot be assumed and performed in full by the Indemnifying Party or which agrees that any element of any of Momenta IP or Joint Collaboration IP (in the event Momenta is the Indemnified Party) is invalid, not infringed or unenforceable.  The Indemnified Parties shall be third party beneficiaries of this Agreement.

 

12.5.        Sharing of Legal Expenses.

 

12.5.1.     Except with respect to a Final Misappropriation Determination, for which the provisions of Section 12.3 shall apply, Momenta shall reimburse Sandoz, via offset from Profit Interest payments due to Momenta pursuant to Section 4.3 with respect to the relevant Collaboration Product, the Momenta Profit Percentage of all Legal Expenses incurred by Sandoz with respect to such Collaboration Product (whether or not a claim was made against Momenta or named Momenta with respect to such Legal Expenses) (other than any Sandoz FTE Costs); provided, however, that if such Collaboration Product is no longer being marketed, then [**] percent ([**]%) of Momenta’s remaining share of such Legal Expenses may be offset against the Profit payments due to Momenta for the other Collaboration Product.

 

12.5.2.     Under no circumstances shall the Profit Interest payable to Momenta, as a result of this Section 12.5, in any Quarter be reduced to less than [**] percent ([**]%) of the Profit Interest amount otherwise payable to Momenta in such Quarter under this Agreement.  Sandoz may offset any portion of the Legal Expenses not deductible from

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

67

 

the Profit Interest payable to Momenta as a result of such limitation against future Profit Interests due to Momenta with respect to such Product (or the other Collaboration Product, to the extent such offset is permitted by the proviso in Section 12.5.1).

 

12.6.        Insurance.  Sandoz shall be self-insured.  To the extent Momenta is required to obtain the consent or waiver of MIT under the MIT Agreement to permit such self-insurance by Sandoz, Momenta shall use its best efforts to obtain such waiver or consent.  Momenta shall comply with the insurance obligations imposed on Momenta pursuant to the MIT Agreement.

 

13.                               DISPUTE RESOLUTION

 

13.1.        First Level Resolution.  Unless otherwise expressly provided for herein, any claim or controversy between Momenta and Sandoz arising out of or relating to the execution, interpretation and performance of this Agreement (including the validity, scope and enforceability of this provision) will be identified in writing and presented to the JSC.  The JSC shall meet within [**] days after delivery of the notice of dispute pursuant to this Section 13.1 and attempt in good faith to resolve the dispute.  If the JSC is unable to decide or resolve such dispute, a notice of dispute shall be submitted to the relevant Executive Officers of the Parties for resolution by good-faith negotiations pursuant to Section 13.2.

 

13.2.        Negotiation Between Executives.  Within [**] days after delivery of the notice of dispute pursuant to Section 13.1, the Executive Officers shall meet at a mutually acceptable time and place, and thereafter as often as they reasonably deem necessary, to attempt to resolve the dispute in good faith.  All reasonable requests for information made by one Party to another will be honored.  All negotiations pursuant to this clause are confidential and shall be treated as compromise and settlement negotiations for purposes of applicable rules of evidence.  If such Executive Officers cannot resolve such dispute within [**] days after their initial meeting pursuant to this Section 13.2, then each Party reserves its right to pursue any and all remedies available under law or equity with respect to such dispute.

 

13.3.        Legal Remedies.  Notwithstanding anything to the contrary in this Article 13, either Party may seek immediate injunctive or other interim relief from any court of competent jurisdiction as necessary to enforce and prevent infringement or misappropriation of the patent rights, copyright rights, trademarks, confidential information, trade secrets, or other intellectual property rights owned or controlled by a Party or its Affiliates or to prevent breach of Article 10.

 

14.                               ADDITIONAL PROVISIONS

 

14.1.        Entire Agreement.  This Agreement, including the Schedules hereto, together with the Equity Agreements, contain the entire agreement and understanding between the Parties relating to the subject matter hereof and all prior agreements and understandings between the Parties and relating to the subject matter hereof, including, without limitation, the MOU and, to the extent relating to the Products, the Prior Confidentiality Agreements, are superseded by this Agreement; provided, however, that the Community of Interest Letters and Agreements shall expressly survive and are hereby amended to remain in effect for the longer of ten (10) years after the Term or ten (10) years following the expiration or termination of the Existing US Lovenox Agreement, and any references in the specific Community of Interest Letter and

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

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Agreement dated [**] to the Prior Confidentiality Agreement shall refer instead to the confidentiality provisions of Article 10 of this Agreement.  The Parties also expressly agree and acknowledge that the Equity Agreements and the Existing US Lovenox Agreement shall not be superseded by this Agreement; provided, however, that the Parties agree that the Existing US Lovenox Agreement is amended to substitute the definition of “Confidential Information” in Section 1.21 hereof for the definition of “Confidential Information” in Section 1.18 of the Existing US Lovenox Agreement.  Neither Party shall be liable or bound to any other Party in any manner by any representations, warranties or covenants relating to such subject matter except as specifically set forth herein.

 

14.2.        Amendments and Waiver.  This Agreement may not be amended except by an instrument in writing signed on behalf of each of the Parties.  By an instrument in writing either Party may waive compliance by the other Party with any term or provision of this Agreement that such other Party was or is obligated to comply with or perform.  Any failure of a Party to enforce at any time, or for any period of time, any of the provisions of this Agreement shall not be deemed or construed to be a waiver of such provisions or a waiver of any right of such Party thereafter to enforce each and every such provision on any succeeding occasion or breach thereof.

 

14.3.        Assignment.  This Agreement and the rights and obligations hereunder shall be assignable only:  (a) except as provided under Section 14.3(c)(i)(B), by a Party to an Affiliate of that Party, without the consent of the other Party, provided that in such case, the assigning Party remains liable with the assignee for all of its obligations hereunder; (b) by a Party with the written consent of the other Party; or (c) by a Party without the consent of the other Party to (i) the purchaser (which, immediately prior to such transaction, is a Third Party) of (A) all or substantially all of the assets of the assigning Party’s business to which this Agreement relates, or (B) a majority of the voting equity securities of the assigning Party who thereby becomes an Affiliate of such Party (provided that in such case, the assigning Party remains liable with the assignee for all of its obligations hereunder); or (ii) the surviving Person, in the event of a merger of the assigning Party and another Person, and any such purchaser or successor shall be bound by the terms hereof.  Any attempted assignment that does not comply with the terms of this Section 14.3 shall be void.  This Agreement shall be binding upon and inure to the benefit of the Parties, their successors (including any successor resulting from a change of control of such Party) and permitted assigns.  Each Party agrees that, notwithstanding any provisions of this Agreement to the contrary, in the event that this Agreement is assigned by either Party as provided in the foregoing clause (c) or a transaction described in clause (c) occurs with respect to a Party, such assignment or transaction shall not provide the other Party with rights or access to intellectual property rights of the acquirer of such Party which were not already Patent Rights or Know-How Controlled by such Party prior to such assignment or transaction.

 

14.4.        Nature of Relationship.  In making and performing this Agreement, the Parties are acting, and intend to be treated, as independent entities and nothing contained herein shall be deemed or implied to create an agency, distributorship, joint venture or partnership relationship among the Parties.  Except as otherwise expressly provided herein, no Party may make any representation, warranty or commitment, whether express or implied, on behalf of or incur any charges or expenses for, or in the name of, the other Party.  Except as provided in Article 12, no

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

69

 

Party shall be liable for the act of the other Party unless such act is expressly authorized in writing by the Parties.

 

14.5.        Notices.  All notices and other communications required or permitted to be given or made pursuant to this Agreement shall be in writing signed by the sender and shall be deemed duly given (a) on the date delivered, if personally delivered, (b) on the date sent by telecopier with automatic confirmation by the transmitting machine showing the proper number of pages were transmitted without error, (c) on the Business Day after being sent by Federal Express or another recognized overnight mail service which utilizes a written form of receipt for next day or next business day delivery, or (d) two (2) Business Days after mailing, if mailed by United States postage-prepaid certified or registered mail, return receipt requested, in each case addressed to the applicable party at the address set forth below; provided that a Party may change its address for receiving notice by the proper giving of notice hereunder:

 

	
If to   Sandoz:
    	
 
    	
If to Momenta:
    
	
 
    	
 
    	
 
    
	
Sandoz AG
    	
 
    	
Momenta Pharmaceuticals, Inc.
    
	
Lichtstraße 35
    	
 
    	
675 West Kendall Street
    
	
CH 4056 Basel BS
    	
 
    	
Cambridge, MA 02142
    
	
Switzerland
    	
 
    	
USA
    
	
Attn:                    Peter   Rupprecht,
    	
 
    	
Attn:                    Chief Executive Officer
    
	
Authorized Signatory
    	
 
    	
Tele:                     617-395-4915
    
	
Tele:                     +41 61 324   5570
    	
 
    	
Fax:                       617-621-3014
    
	
Fax:                       +41 61   324 5372
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
With a copy to:
    	
 
    	
With a copy to:
    
	
 
    	
 
    	
 
    
	
Sandoz Inc.
    	
 
    	
Momenta Pharmaceuticals, Inc.
    
	
506 Carnegie Center,   Suite 400
    	
 
    	
675 West Kendall Street
    
	
Princeton, NJ 08540
    	
 
    	
Cambridge, MA 02142
    
	
Attn:  General   Counsel
    	
 
    	
Attn:  General Counsel
    
	
Tele:  (609)   627-8510
    	
 
    	
Tele:  617-491-9700
    
	
Fax:   (609)   627-8684
    	
 
    	
Fax:   617-621-3014
    
	
 
    	
 
    	
 
    
	
and:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Sandoz International   GmbH
    	
 
    	
Wilmer Cutler Pickering Hale and
    
	
 
    	
 
    	
Dorr LLP
    
	
Industriestrasse 25
    	
 
    	
60 State Street
    
	
83607 Holzkirchen
    	
 
    	
Boston, MA 02109
    
	
Germany
    	
 
    	
USA
    
	
Attn:  General   Counsel
    	
 
    	
Attn:  Steven D. Singer, Esq.
    
	
Tele:    +49-8024-476-0
    	
 
    	
Tele:  (617) 526-6000
    
	
Fax:   +49-8024-476-2589
    	
 
    	
Fax:   (617) 526-5000
    

 

14.6.        Governing Law.  This Agreement and any and all matters arising directly or indirectly herefrom shall be governed by and construed and enforced in accordance with the

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

70

 

internal laws of the State of New York applicable to agreements made and to be performed entirely in such state, without giving effect to the conflict of law principles thereof.

 

14.7.        Jurisdiction and Venue.  Each Party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts located in Manhattan, New York for the purpose of any claim, controversy, action, cause of action, suit or litigation between the Parties arising in whole or in part under or in connection with this Agreement and agrees that such courts are a proper venue for such action.  Each Party agrees that effective process may be served to a Party pursuant to Section 14.5.

 

14.8.        Jury Waiver.  EACH PARTY HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY CLAIM BASED UPON, DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREBY.  EACH PARTY ACKNOWLEDGES THAT IT AND THE OTHER PARTY HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 14.8.

 

14.9.        Counterparts; Facsimile Signature.  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.  This Agreement may also be executed via facsimile, which shall be deemed an original.

 

14.10.      Severability.  In the event that any one or more of the provisions contained herein, or the application thereof in any circumstances, is held invalid, illegal or unenforceable in any respect for any reason, the Parties shall negotiate in good faith with a view to the substitution therefor of a suitable and equitable solution in order to carry out, so far as may be valid and enforceable, the intent and purpose of such invalid provision; provided, however, that the validity, legality and enforceability of any such provision in every other respect and of the remaining provisions contained herein shall not be in any way impaired thereby, it being intended that all of the rights and privileges of the Parties shall be enforceable to the fullest extent permitted by law.

 

14.11.      Expenses.  Each Party shall bear its own direct and indirect expenses incurred in connection with the negotiation and preparation of this Agreement and, except as set forth in this Agreement, the performance of the obligations contemplated hereby and thereby.

 

14.12.      Further Actions and Documents.  Each Party agrees to execute, acknowledge and deliver all such further instruments, and to do all such further acts, as may be reasonably necessary or appropriate to carry out the intent and purposes of this Agreement.

 

14.13.      Use of Trade Names and Trademarks.  Each Party recognizes that the name of the other Party represents valuable assets of such other Party and that substantial recognition and goodwill are associated with such assets.  Each Party hereby agrees that neither it nor any of its Affiliates shall use such assets of the other Party without prior written authorization from such other Party.  Nothing in this Agreement constitutes a license entitling any Party to use any other

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

71

 

Party’s name, logos or trademarks; provided, however, that a Party may use the other Party’s name, logos or trademarks to the extent permitted in Sections 10.4 and 10.5.

 

14.14.      Affiliates.  To the extent that the rights granted to a Party hereunder may be and are exercised by an Affiliate of such Party, such Affiliate shall be bound by the corresponding obligations of such Party.

 

14.15.      Exports.  The Parties acknowledge that the export of technical data, materials or products is subject to the exporting Party receiving any necessary export licenses and that the Parties cannot be responsible for any delays attributable to export controls that are beyond the reasonable control of either Party.  The Parties agree not to export or re-export, directly or indirectly, any information, technical data, the direct product of such data, samples or equipment received or generated under this Agreement in violation of any governmental regulations that may be applicable.  The Parties agree to obtain similar covenants from their licensees with respect to the subject matter of this Section 14.15.

 

14.16.      Force Majeure.  No failure or omission by a Party in the performance of any obligation of this Agreement (excluding payment obligations) shall be deemed a breach of this Agreement or create any liability if the same shall arise from any cause or causes beyond the reasonable control of such Party, including, but not limited to, the following:  acts of God; acts or omissions of any government; any rules, regulations or orders issued by any governmental authority or by any officer, department, agency or instrumentality thereof; fire; storm; flood; earthquake; accident; war; rebellion; terrorism; insurrection; riot; and invasion (a “Force Majeure Event”); and provided that such failure or omission resulting from a Force Majeure Event is cured as soon as is practicable after the occurrence of such Force Majeure Event.  The Party claiming force majeure shall notify the other Party with notice of the Force Majeure Event as soon as practicable, but in no event later than fourteen (14) days after its occurrence, which notice shall reasonably identify such obligations under this Agreement and the extent to which performance thereof will be affected.  In such event, the Parties shall meet promptly to determine an equitable solution to the effects of any such Force Majeure Event.

 

14.17.      Non-Use of MIT Name.  Neither Sandoz nor its Affiliates shall use the name of “MIT,” “Lincoln Laboratory” or any variation, adaptation, or abbreviation thereof, or of any of its trustees, officers, faculty, students, employees, or agents (collectively, “MIT Associates”), or any trademark owned by MIT, or any terms of the MIT Agreement, in any promotional material or other public announcement or disclosure without the prior written consent of MIT, or in the case of the name of any MIT Associate, the written consent of such MIT Associate.  The immediately preceding sentence notwithstanding, without the consent of MIT (but subject to the provisions of Article 10), Sandoz and its Affiliates may state that they are sublicensed by MIT under one or more of the applicable Momenta Patent Rights, may make statements of facts, and may make disclosures or statements required by law.

 

14.18.      Headings.  The captions or headings of the Sections or other subdivisions hereof are inserted only as a matter of convenience or for reference and are not part of the agreement of the Parties and shall have no effect on the meaning of the provisions hereof.  All references in this Agreement to Sections and Schedules are to sections and schedules to this Agreement, unless otherwise indicated.

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

72

 

14.19.      Construction.  Each Party acknowledges that it has been advised by counsel during the course of negotiation of this Agreement and, therefore, that this Agreement shall be interpreted without regard to any presumption or rule requiring construction against the Party causing this Agreement to be drafted.  Except where the context otherwise requires, wherever used, the use of any gender will be applicable to all genders and the word “or” is used in the inclusive sense (and/or).  The term “including” means including, without limiting the generality of any description preceding such term.  Unless the context requires otherwise, (a) any definition of or reference to any agreement, instrument or other document refers to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein or therein), (b) any reference to any laws refer to such laws as from time to time enacted, repealed or amended, and (c) the words “herein”, “hereof” and “hereunder”, and words of similar import, refer to this Agreement in its entirety and not to any particular provision hereof

 

14.20.      No Consequential Damages.  UNLESS RESULTING FROM A PARTY’S WILLFUL MISCONDUCT OR FROM A PARTY’S BREACH OF ARTICLE 10, NO PARTY WILL BE LIABLE TO THE OTHER PARTY OR ITS AFFILIATES FOR SPECIAL, INCIDENTAL, CONSEQUENTIAL, EXEMPLARY, PUNITIVE, MULTIPLE OR OTHER INDIRECT DAMAGES ARISING OUT OF THIS AGREEMENT OR THE EXERCISE OF ITS RIGHTS HEREUNDER, OR FOR LOSS OF PROFITS, LOSS OF DATA OR LOSS OF USE DAMAGES ARISING FROM OR RELATING TO ANY BREACH OF THIS AGREEMENT WHETHER BASED UPON WARRANTY, CONTRACT, TORT, STRICT LIABILITY OR OTHERWISE, REGARDLESS OF ANY NOTICE OF SUCH DAMAGES.  NOTHING IN THIS SECTION 14.20 IS INTENDED TO LIMIT OR RESTRICT THE INDEMNIFICATION RIGHTS OR OBLIGATIONS OF ANY PARTY UNDER THIS AGREEMENT.

 

[Remainder of Page Intentionally Left Blank]

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

73

 

IN WITNESS WHEREOF, the Parties have executed this Collaboration and License Agreement in counterparts, effective as of the 13th day of June, 2007.

 

	
MOMENTA PHARMACEUTICALS, INC.
    	
 
    	
SANDOZ   AG
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
By:
    	
/s/ Craig Wheeler
    	
 
    	
By:
    	
/s/ Peter Rupprecht
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
Name:
    	
Craig Wheeler
    	
 
    	
Name:
    	
Peter Rupprecht
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
Title:
    	
President &   CEO
    	
 
    	
Title:
    	
Member of the Board
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
By:
    	
/s/ Christina Ackermann
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
Name:
    	
Christina Ackermann
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
Title:
    	
General Counsel Sandoz
    

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

74

 

SCHEDULE 1.28
  COST OF GOODS SOLD

 

Cost of goods sold comprises all the costs incurred in producing goods for sale:

 

·      variable and fixed production costs including factory overhead

·      purchase price variances

·      inventory revaluations, inventory destroyed or written-off

·      change in the value of inventory provisions and

·      production variances

·      payments related to product rights, dossiers, patents, trademarks and registration costs that do not meet the criteria for capitalization

·      amortization and impairment losses related to marketable products, i.e. product rights, patent rights, trademarks and core development technologies

·      Other non-production related cost of goods sold that cannot be allocated to any other line of COGS

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

75

 

SCHEDULE 1.82
  CURRENT MOMENTA PATENT RIGHTS

 

	
MNTA Ref. No.
    	
 
    	
Inventors
    	
 
    	
Title
    	
 
    	
Serial No. if pending/
   Patent No. if issued
    
	
M-series   (Momenta-owned cases)
    
	
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C-series   (Licensed to Momenta under the MIT Agreement)
    
	
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[**]
    

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

76

 

	
MNTA Ref. No.
    	
 
    	
Inventors
    	
 
    	
Title
    	
 
    	
Serial No. if pending/
   Patent No. if issued
    
	
[**]
    	
 
    	
[**]
    	
 
    	
[**]
    	
 
    	
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Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

77

 

SCHEDULE 1.89
  NET SALES

 

Net Sales Concepts

 

The Novartis Group’s principal accounting policies are set out in note 1 of the Group’s consolidated financial statements and conform to International Financial Reporting Standards (“IFRS”).  Significant judgments and estimates are used in the preparation of the consolidated financial statements which, to the extent that actual outcomes and results may differ from these assumptions and estimates, could affect the accounting in the areas described in this section.

 

REVENUE

 

Revenue is recognized when title and risk of loss for the products are transferred to the customer. Provisions for rebates and discounts granted to government agencies, wholesalers, managed care and other customers are recorded as a reduction of revenue at the time the related revenues are recorded or when the incentives are offered. They are calculated on the basis of historical experience and the specific terms in the individual agreements. Cash discounts are offered to customers to encourage prompt payment. They are recorded as a reduction of revenue at the time of invoicing. Wholesaler shelf-inventory adjustments are granted to customers based on the existing inventory of a product at the time of decreases in the invoice or contract price of a product or at the point of sale if a price decline is reasonably estimable.  Where there is a historical experience of Novartis agreeing to customer returns, Novartis records a provision for estimated sales returns by applying historical experience of customer returns to the amounts invoiced and the amount of returned products to be destroyed versus products that can be placed back in inventory for resale.

 

Optional

 

DEDUCTIONS FROM REVENUES: As is typical in the pharmaceutical industry, Novartis’ gross sales are subject to various deductions, primarily comprised of rebates and discounts to retail customers, government agencies, wholesalers and managed health care organizations. These deductions represent estimates of the related obligations, requiring the use of judgment when estimating the impact of these sales deductions on gross sales for a reporting period. These adjustments are reported as a reduction of Gross Sales to arrive at Net Sales.

 

The following briefly describes the nature of each deduction and how the deduction is estimated. The US market has the most complex arrangements related to revenue deductions. However, in a number of countries outside the U.S., including major European countries, Novartis provides rebates to government entities. These rebates are often legislatively mandated. Specific references are made to the US market, and where applicable, to [**]:

 

·                  The US Medicaid program is a state government-administered program that uses state and federal funds to provide assistance to certain vulnerable and needy individuals and families. In 1990, the Medicaid Drug Rebate Program was established to reduce state and federal expenditures for prescription drugs. Under the rebate program, [**]. Provisions for estimating  Medicaid rebates are calculated using a combination of historical experience,

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

78

 

product and population growth, price increases, the impact of contracting strategies and specific terms in the individual state agreements. These provisions are adjusted based upon established processes for refiling data with individual states. For Medicaid, the calculation of rebates involves interpretation of relevant regulations, which are subject to challenge or change in interpretative guidance by government authorities. Since Medicaid rebates are typically billed up to six months after the products are dispensed to patients, any rebate adjustments may involve revisions of provisions for several periods.

 

·                  [**]. These savings vary based on a patient’s current drug coverage and personal income levels. Provisions for the subsidiaries’ obligations under these programs are based on historical experience, trend analysis and current program terms.  On January 1, 2006, an additional prescription drug benefit will be added to the US Medicare program. Individuals that have dual Medicaid/Medicare drug benefit eligibility will have their Medicaid prescription drug coverage replaced on January 1, 2006 by the new Medicare Part D coverage, provided through private prescription drug plans. The change will lead to a significant shift of plan participants between programs in which the subsidiaries participate. The [**].

 

·                  Wholesaler chargebacks relate to [**]. A wholesaler chargeback represents the difference between the invoice price to the wholesaler and the indirect customer’s contract discount price. Provisions for estimating chargebacks are calculated using a combination of factors such as historical experience, product growth rates and the specific terms in each agreement. The subsidiaries account for wholesaler’s chargebacks by reducing accounts receivable.  Wholesaler chargebacks are generally settled within three months of incurring the liability.

 

·                  Customer rebates are offered to key managed health care plans, group purchasing organizations and other direct and indirect customers to [**]. These rebate programs provide that the customer receive a rebate after attaining certain performance parameters relating to product purchases, formulary status and/or pre-established market share milestones relative to competitors. Since rebates are contractually agreed upon, rebates are estimated based on the specific terms in each agreement, historical experience and product growth rates. [**].

 

·                  In order to evaluate adequacy of ending provision balances, [**]. Management internally estimates the inventory level in the retail channel and in transit.

 

·                  Where a product with right of customer returns is sold, [**]. Other factors are also considered, such as product recalls and, in the case of [**]. In the US, historical rates of return are utilized and are adjusted for known or expected changes in the marketplace when appropriate. Sales returns amount to approximately [**]% of gross product sales.

 

·                  The policy of [**]. Based on this information, the inventories on hand at wholesalers and other distribution channels in the US are estimated to be approximately one month at December 31, 2005.  Novartis believes the third party data sources of information are sufficiently reliable, however its accuracy cannot be verified.

 

·                  At the end of 2005, [**].

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

79

 

·                  Cash discounts are offered to customers in the US and certain other countries to encourage prompt payment. Cash discounts, which are typically [**]% of gross sales in the US, are accrued at the time of invoicing.

 

·                  Shelf-stock adjustments are generally granted to customers based on the existing inventory of a customer following decreases in the invoice or contract price of the related product. Provisions for [**], are determined at the time of the [**] or at the [**].

 

·                  Other sales discounts, such as consumer coupons and discount cards, are also offered. These discounts are recorded at the time of sales or when the coupon is issued and estimated utilizing historical experience and the specific terms for each program.

 

·                  Discounts, rebates or other deductions shown on the invoice are generally recorded directly as a reduction in the gross to net sales value and do not pass through the provision account.

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

80

 

SCHEDULE 1.124
  CURRENT SANDOZ PATENT RIGHTS

 

[**]

 

Confidential Portions of this Exhibit marked as [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Securities and Exchange Commission.

 

81Exhibit

Exhibit 10.1

EXECUTION VERSION

CUSIP NUMBER: 66807PAN0
    

$400,000,000 THIRD AMENDED AND RESTATED CREDIT AGREEMENT
among
NORTHWESTERN CORPORATION,
as Borrower,
The Several Lenders
from Time to Time Parties Hereto,
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED and 
CREDIT SUISSE SECURITIES (USA) LLC
as Joint Lead Arrangers,
CREDIT SUISSE SECURITIES (USA) LLC
As Syndication Agent,
KEYBANK NATIONAL ASSOCIATION,
MUFG UNION BANK, N.A., and
U.S. BANK NATIONAL ASSOCIATION,
as Co-Documentation Agents,
and 

BANK OF AMERICA, N.A.,
as Administrative Agent
Dated as of December 12, 2016

    

Exhibit 10.1

TABLE OF CONTENTS
Page
		
	SECTION 1. DEFINITIONS
	1

		
	1.1.
	Defined Terms    1

		
	1.2.
	Other Definitional Provisions      19

		
	SECTION 2. AMOUNT AND TERMS OF COMMITMENTS
	20

		
	2.1.
	Revolving Credit Commitments    20

		
	2.2.
	Procedure for Revolving Credit Borrowing    22

		
	2.3.
	[Reserved]    23

		
	2.4.
	[Reserved]    23

		
	2.5.
	Repayment of Loans; Evidence of Debt    23

		
	2.6.
	Commitment Fees, etc    23

		
	2.7.
	Termination or Reduction of Revolving Credit Commitments    24

		
	2.8.
	Optional Prepayments    24

		
	2.9.
	Conversion and Continuation Options    24

		
	2.10.
	Minimum Amounts and Maximum Number of Eurodollar Tranches    25

		
	2.11.
	Interest Rates and Payment Dates    25

		
	2.12.
	Computation of Interest and Fees    26

		
	2.13.
	Inability to Determine Interest Rate    26

		
	2.14.
	Pro Rata Treatment and Payments    27

		
	2.15.
	Requirements of Law    29

		
	2.16.
	Taxes    30

		
	2.17.
	Indemnity    33

		
	2.18.
	Illegality    33

		
	2.19.
	Change of Lending Office    34

		
	2.20.
	Replacement of Lenders under Certain Circumstances    34

		
	2.21.
	Defaulting Lenders    35

		
	2.22.
	Cash Collateral    37

		
	SECTION 3. LETTERS OF CREDIT
	38

		
	3.1.
	L/C Commitment    38

		
	3.2.
	Procedure for Issuance of Letter of Credit    39

		
	3.3.
	Fees and Other Charges    40

		
	3.4.
	L/C Participations    40

		
	3.5.
	Reimbursement Obligation of the Borrower    42

		
	3.6.
	Obligations Absolute    42

		
	3.7.
	Letter of Credit Payments    43

		
	3.8.
	Applications    43

		
	3.9.
	Existing Letters of Credit    44

		
	3.10.
	Applicability of ISP and UCP; Limitation of Liability    44

Exhibit 10.1

		
	SECTION 4. REPRESENTATIONS AND WARRANTIES
	44

		
	4.1.
	Financial Condition    44

		
	4.2.
	No Change    45

		
	4.3.
	Corporate Existence; Compliance with Law    45

		
	4.4.
	Corporate Power; Authorization; Enforceable Obligations    45

		
	4.5.
	No Legal Bar    46

		
	4.6.
	No Material Litigation    46

		
	4.7.
	No Default    46

		
	4.8.
	Ownership of Property    46

		
	4.9.
	Intellectual Property    46

		
	4.10.
	Taxes    46

		
	4.11.
	Federal Regulations    47

		
	4.12.
	Labor Matters    47

		
	4.13.
	ERISA    47

		
	4.14.
	Investment Company Act; Other Regulations    47

		
	4.15.
	Subsidiaries    47

		
	4.16.
	Environmental Matters    48

		
	4.17.
	Accuracy of Information, etc    49

		
	4.18.
	Solvency    49

		
	4.19.
	Anti-Corruption; OFAC; Anti-Money Laundering    49

		
	SECTION 5. CONDITIONS PRECEDENT
	50

		
	5.1.
	Conditions to Closing Date    50

		
	5.2.
	Conditions to Each Extension of Credit or Increase of Revolving Credit 

Commitments    51
		
	SECTION 6. AFFIRMATIVE COVENANTS
	52

		
	6.1.
	Financial Statements    52

		
	6.2.
	Certificates; Other Information    53

		
	6.3.
	Payment of Obligations    53

		
	6.4.
	Conduct of Business and Maintenance of Existence; Compliance    54

		
	6.5.
	Maintenance of Property; Insurance    54

		
	6.6.
	Inspection of Property; Books and Records; Discussions    54

		
	6.7.
	Notices    54

		
	6.8.
	Environmental Laws    55

		
	6.9.
	Further Assurances    55

		
	6.10.
	Use of Proceeds    56

		
	6.11.
	Credit Ratings    56

		
	SECTION 7. NEGATIVE COVENANTS
	56

		
	7.1.
	Consolidated Debt to Capitalization Ratio    56

		
	7.2.
	Limitation on Fundamental Changes    56

		
	7.3.
	Limitation on Transactions with Affiliates    56

		
	7.4.
	Limitation on Changes in Fiscal Periods    57

		
	7.5.
	Limitation on Negative Pledge Clauses    57

		
	7.6.
	Limitation on Restrictions on Subsidiary Distributions    57

		
	7.7.
	Limitation on Lines of Business    57

Exhibit 10.1

		
	SECTION 8. EVENTS OF DEFAULT
	57

		
	SECTION 9. THE ADMINISTRATIVE AGENT
	60

		
	9.1.
	Appointment    60

		
	9.2.
	Delegation of Duties    60

		
	9.3.
	Exculpatory Provisions    60

		
	9.4.
	Reliance by the Administrative Agent    61

		
	9.5.
	Notice of Default    61

		
	9.6.
	Non‐Reliance on Administrative Agent and Other Lenders    61

		
	9.7.
	Indemnification    62

		
	9.8.
	Agent in Its Individual Capacity    62

		
	9.9.
	Successor Agents    63

		
	9.10.
	The Joint Lead Arrangers; the Syndication Agent; the Co-Documentation 

Agents    63
		
	SECTION 10. MISCELLANEOUS
	63

		
	10.1.
	Amendments and Waivers    63

		
	10.2.
	Notices    65

		
	10.3.
	No Waiver; Cumulative Remedies    67

		
	10.4.
	Survival of Representations and Warranties    67

		
	10.5.
	Payment of Expenses    68

		
	10.6.
	Successors and Assigns; Participations and Assignments    69

		
	10.7.
	Adjustments; Set‐off    73

		
	10.8.
	Counterparts    74

		
	10.9.
	Severability    74

		
	10.10.
	Integration    74

		
	10.11.
	Governing Law    75

		
	10.12.
	Submission To Jurisdiction; Waivers    75

		
	10.13.
	No Fiduciary Duty    75

		
	10.14.
	Confidentiality    76

		
	10.15.
	Accounting Changes    76

		
	10.16.
	WAIVERS OF JURY TRIAL    77

		
	10.17.
	USA PATRIOT ACT    77

		
	10.18.
	Electronic Execution of Assignments and Certain Other Documents    77

		
	10.19.
	Amendment and Restatement; No Novation    77

		
	10.20.
	Acknowledgement and Consent to Bail-In of EEA Financial Institutions    78

Exhibit 10.1

APPENDIX:
Commitment Appendix
ANNEXES:
A    Pricing Grid
B    Existing Letters of Credit

SCHEDULES:

4.4    Consents, Authorizations, Filings and Notices
4.6    Litigation
4.8    Title to Property
4.14    Limiting Regulations
4.15    Subsidiaries
4.16    Environmental
7.3    Affiliate Transactions
7.5    Negative Pledge Limitations

EXHIBITS:

A    Form of Compliance Certificate
B    Form of Secretary’s Certificate
C    Form of Revolving Credit Note
D    Form of Assignment and Acceptance
E    Form of Exemption Certificate
F    Form of Borrowing Notice
G    Form of Letter of Credit Request
H    Form of New Lender Supplement
I    Form of Increased Revolving Commitment Activation Notice

    

    

Exhibit 10.1

THIRD AMENDED AND RESTATED CREDIT AGREEMENT, dated as of December 12, 2016, among NORTHWESTERN CORPORATION d/b/a NorthWestern Energy, a Delaware corporation (the “Borrower”), the several banks and other financial institutions or entities from time to time parties to this Agreement (the “Lenders”), and BANK OF AMERICA, N.A., as administrative agent.
W I T N E S S E T H:
WHEREAS, the Borrower, certain of the Lenders and the other parties are parties to the Original Credit Agreement (as hereinafter defined).
WHEREAS, the Lenders and such other parties or their successors have agreed to amend and restate in its entirety the Original Credit Agreement as provided herein; and
WHEREAS, the Borrower has requested and the Lenders have agreed to make this revolving credit facility available to the Borrower upon and subject to the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the agreements hereinafter set forth, the parties hereto hereby agree as follows:
SECTION 1.  DEFINITIONS

2.1.Defined Terms.  As used in this Agreement, the terms listed in this Section 1.1 shall have the respective meanings set forth in this Section 1.1.
“Accounting Change”:  as defined in Section 10.15.
“Administrative Agent”:  Bank of America in its capacity as administrative agent under any of the Loan Documents, or any successor administrative agent.
“Affiliate”:  as to any Person, any other Person that, directly or indirectly, is in control of, is controlled by, or is under common control with, such Person.  For purposes of this definition, “control” of a Person means the power, directly or indirectly, to direct or cause the direction of the management and policies of such Person, whether through the ownership of voting securities, by contract or otherwise.
“Agents”:  the collective reference to the Syndication Agent, the Administrative Agent and the Co-Documentation Agents.
“Aggregate Exposure”:  with respect to any Lender at any time, an amount equal to the amount of such Lender’s Revolving Credit Commitment then in effect or, if the Revolving Credit Commitments have been terminated, the amount of such Lender’s Revolving Extensions of Credit then outstanding.
“Aggregate Exposure Percentage”:  with respect to any Lender at any time, the ratio (expressed as a percentage) of such Lender’s Aggregate Exposure at such time to the sum of the Aggregate Exposures of all Lenders at such time.

Exhibit 10.1

“Agreement”:  this Credit Agreement, as amended, restated, supplemented or otherwise modified from time to time.
“Anti-Corruption Law”:  as defined in Section 4.19.
“Anti-Money Laundering Laws”:  as defined in Section 4.19(c). 
“Applicable Margin”:  a percentage determined from time to time in accordance with the pricing grid attached hereto as Annex A.
“Applicable Percentage”: with respect to any Lender at any time, the percentage (carried out to the ninth decimal place) of the aggregate Revolving Credit Commitments represented by such Lender’s Revolving Credit Commitment at such time, subject to adjustment as provided in Section 2.21.  If the Revolving Credit Commitment of each Lender to make Loans and the obligation of the Issuing Lender to make L/C Credit Extensions have been terminated pursuant to Section 8 or if the aggregate Revolving Credit Commitments have expired, then the Applicable Percentage of each Lender shall be determined based on the Applicable Percentage of such Lender most recently in effect, giving effect to any subsequent assignments.  The initial Applicable Percentage of each Lender is set forth opposite the name of such Lender on the Commitment Appendix or in the assignment and acceptance pursuant to which such Lender becomes a party hereto, as applicable.
“Application”:  an application, in such form as the relevant Issuing Lender may specify from time to time, requesting such Issuing Lender to issue a Letter of Credit.
“Applicable Margin”:  as of any date, with respect to any Base Rate Loan or Eurodollar Loan, the percentage set forth in the Pricing Grid under “Base Rate Margin” or “Eurodollar Margin,” respectively, in each case based on the then-current Debt Rating.
“Assignee”:  as defined in Section 10.6(c).
“Assignor”:  as defined in Section 10.6(c).
“Available Revolving Credit Commitment”:  with respect to any Revolving Credit Lender at any time, an amount equal to the excess, if any, of (a) such Lender’s Revolving Credit Commitment then in effect over (b) such Lender’s Revolving Extensions of Credit then outstanding.
“Bail-In Action”:  the exercise of any Write-Down and Conversion Powers by the applicable EEA Resolution Authority in respect of any liability of an EEA Financial Institution.
“Bail-In Legislation”:  with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule.
“Bank of America”: Bank of America, N.A. and its successors.

Exhibit 10.1

“Bank of America Entity”: any of Bank of America or any of its Affiliates.
“Base Rate”: for any day, a rate per annum (rounded upwards, if necessary, to the next 1/100 of 1%) equal to the greatest of (a) the Prime Rate in effect on such day, (b) the Federal Funds Effective Rate in effect on such day plus 1⁄2 of 1% and (c) the Eurodollar Rate for a one month Interest Period on such day (or if such day is not a Business Day, the immediately preceding Business Day) plus 1%; provided that, for the avoidance of doubt, the Eurodollar Rate for any day shall be based on the rate appearing on the applicable Bloomberg screen page (or such other commercially available source providing such quotations as may be designated by the Administrative Agent from time to time) at approximately 11:00 a.m. London time on such day.  For purposes hereof:  “Prime Rate” shall mean the rate of interest in effect for such day as publicly announced from time to time by Bank of America as its “prime rate” (the “prime rate” is a rate set by Bank of America based upon various factors including Bank of America’s costs and desired return, general economic conditions and other factors, and is used as a reference point for pricing some loans, which may be priced at, above, or below such announced rate).  Any change in the Base Rate due to a change in the Eurodollar Rate, the Prime Rate or the Federal Funds Effective Rate shall be effective as of the opening of business on the effective day of such change in Eurodollar Rate, the Prime Rate or the Federal Funds Effective Rate, respectively.

“Base Rate Loans”:  Loans for which the applicable rate of interest is based upon the Base Rate.
“Benefitted Lender”:  as defined in Section 10.7.
“Board”:  the Board of Governors of the Federal Reserve System of the United States (or any successor).
“Borrower”:  as defined in the preamble hereto.
“Borrower Materials”:  as defined in Section 10.1.
“Borrowing Date”:  any Business Day specified by the Borrower as a date on which the Borrower requests the Lenders to make Loans hereunder.
“Borrowing Notice”:  with respect to any request for borrowing of Loans hereunder, a notice from the Borrower, substantially in the form of, and containing the information prescribed by, Exhibit F, or such other form as may be approved by the Administrative Agent (including any form on an electronic platform or electronic transmission system as shall be approved by the Administrative Agent), appropriately completed and signed by a Responsible Officer of the Borrower.
“Business Day”:  (a) for all purposes other than as covered by clause (b) below, a day other than a Saturday, Sunday or other day on which commercial banks in New York City are authorized or required by law to close and (b) with respect to all notices and determinations in connection with, and payments of principal and interest on, Eurodollar Loans, any day which is a Business Day described in clause (a) and which is also a day for trading by and between banks in Dollar deposits in the interbank eurodollar market.

Exhibit 10.1

“Capital Lease Obligations”:  with respect to any Person, the obligations of such Person to pay rent or other amounts under any lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted for as capital leases on a balance sheet of such Person under GAAP; and, for the purposes of this Agreement, the amount of such obligations at any time shall be the capitalized amount thereof at such time determined in accordance with GAAP; provided, however, notwithstanding any accounting rule or interpretation under GAAP, Capital Lease Obligation shall not include (a) any Contractual Obligation arising under a power purchase and sale agreement, tolling agreement, off-take agreement, capacity sale agreement or other similar agreement, or (b) any obligations under leases or other agreements created by Accounting Standards Codification 810-10 issued by the Financial Accounting Standards Board.
“Capital Stock”:  any and all shares, interests, participations or other equivalents (however designated) of capital stock of a corporation, any and all equivalent ownership interests in a Person (other than a corporation) and any and all warrants, rights or options to purchase any of the foregoing; provided, “Capital Stock” shall exclude any debt security that is convertible into, or exchangeable for, Capital Stock (whether or not such debt securities include any right of participation with Capital Stock).
“Cash Collateralize”: to pledge and deposit with or deliver to the Administrative Agent, for the benefit of the Administrative Agent, Issuing Lender and the Lenders, as collateral for L/C Obligations or obligations of Lenders to fund participations in respect thereof, cash or deposit account balances or, if the Issuing Lender benefitting from such collateral shall agree in its sole discretion, other credit support, in each case pursuant to documentation in form and substance satisfactory to (a) the Administrative Agent and (b) the Issuing Lender.  “Cash Collateral” shall have a meaning correlative to the foregoing and shall include the proceeds of such cash collateral and other credit support.
“Change of Control”:  the occurrence of any of the following events:  (a) any Person or “group” (within the meaning of Section 13(d) or 14(d) of the Securities Exchange Act of 1934) (i) shall have acquired beneficial ownership of 40% or more of the aggregate outstanding classes of Capital Stock having voting power in the election of directors of the Borrower or (ii) shall obtain the power (whether or not exercised) to elect a majority of the Borrower’s directors; (b) a majority of the seats (other than vacant seats) on the board of directors of the Borrower shall at any time be occupied by Persons who were neither (i) nominated nor approved by the board of directors, (ii) nominated nor approved by any Person having, as of the Closing Date, beneficial ownership of 20% or more of the aggregate outstanding classes of Capital Stock having voting power in the election of directors of the Borrower, nor (iii) appointed nor approved by directors so nominated; or (c) the Borrower shall be liquidated or dissolved.
“Closing Date”:  the date on which the conditions precedent set forth in Section 5.1 shall have been satisfied, which date shall be not later than December 12, 2016.
“Code”:  the Internal Revenue Code of 1986, as amended from time to time.
“Co-Documentation Agents”:  KeyBank National Association, MUFG Union Bank, N.A. and U.S. Bank National Association, in their respective capacity as Co-Documentation Agent.

Exhibit 10.1

“Commitment Fee Rate”:  the rate per annum determined from time to time pursuant to the Pricing Grid.
“Commonly Controlled Entity”:  an entity, whether or not incorporated, that is under common control with the Borrower within the meaning of Section 4001 of ERISA or is part of a group that includes the Borrower and that is treated as a single employer under Section 414 of the Code.
“Compliance Certificate”:  a certificate duly executed by a Responsible Officer, substantially in the form of Exhibit A.
“Consolidated Debt to Capitalization Ratio”:  as of the last day of any period, the ratio of (a) Consolidated Funded Debt on such day to (b) the sum of Consolidated Net Worth and Consolidated Funded Debt on such day.
“Consolidated Funded Debt”:  at any date, the aggregate principal amount of all Funded Debt of the Borrower and its Subsidiaries at such date, determined on a consolidated basis in accordance with GAAP.
“Consolidated Net Worth”:  at any date, all amounts that would, in conformity with GAAP, be included on a consolidated balance sheet of the Borrower and its Subsidiaries under stockholders’ equity at such date.
“Contractual Obligation”:  as to any Person, any provision of any security issued by such Person or of any agreement, instrument or other undertaking to which such Person is a party or by which it or any of its Property is bound.
“Debt Rating”:  as of any date of determination, those credit ratings then published by the Ratings Agencies with respect to the Borrower’s non­credit­enhanced, senior unsecured long-term debt.  For purposes of the foregoing:  (a) if a Debt Rating is issued by each of the Ratings Agencies and there is a split rating, then the two highest of such Debt Ratings shall apply (with the Debt Rating for Pricing Level V being the lowest and the Debt Rating for Pricing Level I being the highest) in determining the Pricing Level; (b) if there is a single level split in Debt Ratings of the two highest ratings of the Ratings Agencies, then the higher Debt Rating of the two highest shall apply in determining the Pricing Level or, if there is a multiple-level split in Debt Ratings of the two highest ratings of the Ratings Agencies, then the Debt Rating that is one level lower than the highest rating shall apply in determining the Pricing Level; (c) if only two Rating Agencies have published Debt Ratings, the Debt Ratings of such Rating Agencies shall be used in determining the Pricing Level and clause (b) of this paragraph shall apply in the event of a split between such two Debt Ratings; (d) if only one Rating Agency has published a Debt Rating, the Debt Rating of such Rating Agency shall be used in determining the Pricing Level; (e) if the Borrower’s non­credit­enhanced, senior unsecured long-term debt is not rated by any of the Rating Agencies, Pricing Level V shall apply for purposes of determining the Applicable Margin; (f) if any Debt Rating established by a Rating Agency shall be changed, such change shall be effective as of the date on which such change is first announced publicly by the Rating Agency making such change; and (g) if any Rating Agency shall change its system of 

Exhibit 10.1

classification after the date hereof, each reference to the Debt Rating announced by such Rating Agency shall refer to the then-equivalent rating thereby, as the case may be.
“Debtor Relief Laws”: the Bankruptcy Code of the United States, and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief Laws of the United States or other applicable jurisdictions from time to time in effect and affecting the rights of creditors generally.
“Declining Lender”:  as defined in Section 2.1(e).
“Default”:  any of the events specified in clauses (a) through (j) of Section 8, whether or not any requirement for the giving of notice, the lapse of time, or both, has been satisfied.
“Defaulting Lender”: subject to Section 2.21, any Lender that, as determined by the Administrative Agent, (a) has failed to perform any of its funding obligations hereunder,  including in respect of its Loans or participations in respect of Letters of Credit, within three Business Days of the date required to be funded by it hereunder, unless such obligation is the subject of a good faith dispute, (b) has notified the Borrower, the Administrative Agent or any Lender that it does not intend to comply with its funding obligations or has made a public statement to that effect with respect to its funding obligations hereunder or under other agreements in which it commits to extend credit, (c) has failed, within three Business Days after request by the Administrative Agent, to confirm in a manner satisfactory to the Administrative Agent that it will comply with its funding obligations, or (d) has, or has a direct or indirect parent company that has, (i) become the subject of a proceeding under any Debtor Relief Law, (ii) had a receiver, conservator, trustee, administrator, assignee for the benefit of creditors or similar Person charged with reorganization or liquidation of its business or a custodian appointed for it, (iii) taken any action in furtherance of, or indicated its consent to, approval of or acquiescence in any such proceeding or appointment or (iv) become the subject of a Bail-In Action; provided that a Lender shall not be a Defaulting Lender solely by virtue of the ownership or acquisition of any equity interest in that Lender or any direct or indirect parent company thereof by a Governmental Authority.
“Disposition”:  with respect to any Property, any sale, lease, sale and leaseback, assignment, conveyance, transfer or other disposition thereof (or, in each case, any series of related dispositions); and the terms “Dispose” and “Disposed of” shall have correlative meanings.
“Dollars” and “$”:  dollars in lawful currency of the United States of America.
“EEA Financial Institution”:  (a) any credit institution or investment firm established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any financial institution established in an EEA Member Country which is a Subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent. 

Exhibit 10.1

“EEA Member Country”:  any of the member states of the European Union, Iceland, Liechtenstein, and Norway.
“EEA Resolution Authority”:  any public administrative authority or any Person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.
“Environmental Laws”:  any and all laws, rules, orders, regulations, statutes, ordinances, guidelines, codes, decrees, or other legally enforceable requirements (including common law) of any international authority, foreign government, the United States, or any state, local, municipal or other governmental authority, regulating, relating to or imposing liability or standards of conduct concerning protection of the environment or of human health, or employee health and safety, as has been, is now, or may at any time hereafter be, in effect.
“Environmental Permits”:  any and all permits, licenses, approvals, registrations, notifications, exemptions and other authorizations required under any Environmental Law.
“Equity Interests”:  Capital Stock of the Borrower or any of its Subsidiaries, and all warrants, options or other rights to acquire Capital Stock of the Borrower or any Subsidiary (but excluding any debt security that is convertible into, or exchangeable for, such Capital Stock).
“ERISA”:  the Employee Retirement Income Security Act of 1974, as amended from time to time.
“EU Bail-In Legislation Schedule”:  the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor person), as in effect from time to time.
“Eurocurrency Reserve Requirements”:  for any day, as applied to a Eurodollar Loan, the aggregate (without duplication) of the maximum rates (expressed as a decimal fraction) of reserve requirements in effect on such day (including basic, supplemental, marginal and emergency reserves) under any regulations of the Board or other Governmental Authority having jurisdiction with respect thereto dealing with reserve requirements prescribed for eurocurrency funding (currently referred to as “Eurocurrency Liabilities” in Regulation D of the Board) maintained by a member bank of the Federal Reserve System.
“Eurodollar Base Rate”:  with respect to each day during each Interest Period, the rate per annum determined on the basis of the rate for deposits in Dollars for a period equal to such Interest Period commencing on the first day of such Interest Period appearing on the applicable Bloomberg screen page as of 11:00 A.M., London time, two Business Days prior to the beginning of such Interest Period. In the event that such rate does not appear on the applicable Bloomberg screen page (or successor thereto), the “Eurodollar Base Rate” for purposes of this definition shall be determined by reference to such other comparable publicly available service for displaying eurodollar rates as may be selected by the Administrative Agent. If the Eurodollar Bate Rate shall be less than zero, such rate shall be deemed zero for purposes of this Agreement. 
“Eurodollar Loans”:  Loans for which the applicable rate of interest is based upon the Eurodollar Rate.

Exhibit 10.1

“Eurodollar Rate”:  with respect to each day during each Interest Period, a rate per annum determined for such day in accordance with the following formula (rounded upward to the nearest 1/100th of 1%):

	
		
	 
	                 Eurodollar Base Rate
1.00 - Eurocurrency Reserve Requirements

“Eurodollar Tranche”:  the collective reference to Eurodollar Loans under a particular Facility the then current Interest Periods with respect to all of which begin on the same date and end on the same later date (whether or not such Loans shall originally have been made on the same day).
“Event of Default”:  any of the events specified in clauses (a) through (j) of Section 8; provided that any requirement for the giving of notice, the lapse of time, or both, has been satisfied.
“Existing Letters of Credit”:  collectively, the letters of credit listed on Annex B issued for the account of the Borrower pursuant to the terms of the Original Credit Agreement.  
“Extended Revolving Termination Date”:  as defined in Section 2.1(e).
“Extending Lender”:  as defined in Section 2.1(e).
“Extension Request”:  as defined in Section 2.1(e).
“Facility” or “Revolving Credit Facility”:  the Revolving Credit Commitments and the extensions of credit made thereunder.
“FATCA”: Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations or official interpretations thereof and any agreements entered into pursuant to Section 1471(b)(1) of the Code.
“Federal Funds Effective Rate”:  for any day, the rate per annum equal to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System, as published on the next Business Day by the Federal Reserve Bank of New York; provided that (a) if such day is not a Business Day, the Federal Funds Effective Rate shall be determined in the same manner, but assuming that such transactions occurred one Business Day earlier, and (b) if no such rate is published on the next Business Day, the Federal Funds Effective Rate shall be the average rate (rounded upward, if necessary, to the nearest 1/100 of 1%) charged to Bank of America on such day on such transactions as determined by the Administrative Agent in its reasonable discretion. If the Federal Funds Effective Rate shall be less than zero, such rate shall be deemed zero for purposes of this Agreement.
“Fee Letters”:  that (i) Fee Letter dated November 9, 2016 among Bank of America, N.A., as administrative agent and issuing lender and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as joint lead arranger and bookrunner, and the Borrower and (ii) that Fee Letter 

Exhibit 10.1

dated November 9, 2016 among Credit Suisse AG, Credit Suisse Securities (USA) LLC, as joint lead arranger and syndication agent, and the Borrower.
“Fitch”:  Fitch, Inc. and any successor thereto.
“Fronting Exposure”: at any time there is a Defaulting Lender, such Defaulting Lender’s Applicable Percentage of the outstanding L/C Obligations other than L/C Obligations as to which such Defaulting Lender’s participation obligation has been reallocated to other Lenders or Cash Collateralized in accordance with the terms hereof.
“Funded Debt”:  with respect to any Person, all Indebtedness of such Person of the types described in clauses (a) through (e) of the definition of “Indebtedness” in this Section 1.1.
“Funding Office”:  the office specified from time to time by the Administrative Agent as its funding office by notice to the Borrower and the Lenders.
“GAAP”:  generally accepted accounting principles in the United States of America as in effect from time to time; provided, however, if any operating lease would be recharacterized as a capital lease due to changes in the accounting treatment of such operating lease under GAAP since the Commitment Date, then solely with respect to the accounting treatment of any such leases, GAAP shall be interpreted as it was in effect on the Commitment Date.
“Governmental Authority”:  any nation or government, any state or other political subdivision thereof, any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative functions of or pertaining to government, and any securities exchange (including any supra national bodies such as the European Union or the European Central Bank) and any group or body charged with setting financial accounting or regulatory capital rules or standards (including the Financial Accounting Standards Board, the Bank for International Settlements or the Basel Committee on Banking Supervision or any successor or similar authority to any of the foregoing).
“Granting Lender” as defined in Section 10.6(j).
“Guarantee Obligation”:  as to any Person (the “guaranteeing person”), any obligation, including a reimbursement, counterindemnity or similar obligation, of the guaranteeing person that guarantees or in effect guarantees, or which is given to induce the creation of a separate obligation by another Person (including any bank under any letter of credit) that guarantees or in effect guarantees any Indebtedness, leases, dividends or other obligations (the “primary obligations”) of any other third Person (the “primary obligor”) in any manner, whether directly or indirectly, including any obligation of the guaranteeing person, whether or not contingent, (i) to purchase any such primary obligation or any Property constituting direct or indirect security therefor, (ii) to advance or supply funds (1) for the purchase or payment of any such primary obligation or (2) to maintain working capital or equity capital of the primary obligor or otherwise to maintain the net worth or solvency of the primary obligor, (iii) to purchase Property, securities or services primarily for the purpose of assuring the owner of any such primary obligation of the ability of the primary obligor to make payment of such primary obligation or (iv) otherwise to assure or hold harmless the owner of any such primary obligation against loss in 

Exhibit 10.1

respect thereof; provided, however, that the term Guarantee Obligation shall not include endorsements of instruments for deposit or collection in the ordinary course of business.  The amount of any Guarantee Obligation of any guaranteeing person shall be deemed to be the lower of (a) an amount equal to the stated or determinable amount of the primary obligation in respect of which such Guarantee Obligation is made and (b) the maximum amount for which such guaranteeing person may be liable pursuant to the terms of the instrument embodying such Guarantee Obligation, unless such primary obligation and the maximum amount for which such guaranteeing person may be liable are not stated or determinable, in which case the amount of such Guarantee Obligation shall be such guaranteeing person’s maximum reasonably anticipated liability in respect thereof as determined by the Borrower in good faith.
“Hedge Agreements”:  all interest rate or currency swaps, caps or collar agreements, foreign exchange agreements, or similar arrangements entered into by the Borrower or its Subsidiaries providing for protection against fluctuations in interest rates, currency exchange rates, or the exchange of nominal interest obligations, either generally or under specific contingencies.
“ICC”:  as defined in the definition of “UCP”.
“Increased Revolving Commitment Activation Notice”:  a notice substantially in the form of Exhibit I.
“Increased Revolving Commitment Closing Date”:  any Business Day designated as such in an Increased Revolving Commitment Activation Notice.
“Indebtedness”:  of any Person at any date, without duplication, (a) all indebtedness of such Person for borrowed money, (b) all obligations of such Person for the deferred purchase price of Property or services (other than trade payables incurred in the ordinary course of such Person’s business), (c) all obligations of such Person evidenced by notes, bonds, debentures or other similar instruments, (d) all indebtedness created or arising under any conditional sale or other title retention agreement with respect to Property acquired by such Person (even though the rights and remedies of the seller or lender under such agreement in the event of default are limited to repossession or sale of such Property), other than any such indebtedness arising solely in connection with the Borrower’s gas storage arrangements, (e) all Capital Lease Obligations of such Person, (f) all obligations of such Person, contingent or otherwise, as an account party or applicant under acceptance, letter of credit, surety bond or similar facilities, (g) all obligations of such Person, contingent or otherwise, to purchase, redeem, retire or otherwise acquire for value any Capital Stock of such Person, (h) all Mandatory Redeemable Stock of such Person, (i) all Guarantee Obligations of such Person in respect of obligations of the kind referred to in clauses (a) through (h) above, (j) all obligations of the kind referred to in clauses (a) through (i) above secured by (or for which the holder of such obligation has an existing right, contingent or otherwise, to be secured by) any Lien on Property (including accounts and contract rights) owned by such Person, whether or not such Person has assumed or become liable for the payment of such obligation and (k) for the purposes of Section 8(e) only, all obligations of such Person in respect of Hedge Agreements.  The Indebtedness of any Person shall include the Indebtedness of any other entity (including any partnership in which such Person is a general partner) to the extent such Person is liable therefor as a result of such Person’s ownership interest 

Exhibit 10.1

in or other relationship with such entity, except to the extent the terms of such Indebtedness expressly provide that such Person is not liable therefor.
“Indemnified Liabilities”:  as defined in Section 10.5.
“Indemnitee”:  as defined in Section 10.5.
“Indentures”:  collectively, the Montana First Mortgage Indenture and the South Dakota First Mortgage Indenture.
“Insolvency”:  with respect to any Multiemployer Plan, the condition that such Plan is insolvent within the meaning of Section 4245 of ERISA.
“Insolvent”:  pertaining to a condition of Insolvency.
“Intellectual Property”:  the collective reference to all rights, priorities and privileges relating to intellectual property, whether arising under United States, multinational or foreign laws or otherwise, including copyrights, copyright licenses, patents, patent licenses, trademarks, trademark licenses, technology, know-how and processes, and all rights to sue at Law or in equity for any infringement or other impairment thereof, including the right to receive all proceeds and damages therefrom.
“Interest Payment Date”:  (a) as to any Base Rate Loan, the last day of each March, June, September and December to occur while such Loan is outstanding and the final maturity date of such Loan, (b) as to any Eurodollar Loan having an Interest Period of three months or shorter, the last day of such Interest Period, (c) as to any Eurodollar Loan having an Interest Period longer than three months, each day that is three months, or a whole multiple thereof, after the first day of such Interest Period and the last day of such Interest Period and (d) as to any Loan (other than any Revolving Credit Loan that is a Base Rate Loan), the date of any repayment or prepayment made in respect thereof.
“Interest Period”: as to any Eurodollar Loan, (a) initially, the period commencing on the borrowing or conversion date, as the case may be, with respect to such Eurodollar Loan and ending one, two, three or six months (or with the consent of all Lenders, as determined by such Lenders in their sole discretion, twelve months) thereafter, as selected by the Borrower in its notice of borrowing or notice of conversion, as the case may be, given with respect thereto; and (b) thereafter, each period commencing on the last day of the next preceding Interest Period applicable to such Eurodollar Loan and ending one, two, three or six months (or with the consent of all Lenders, as determined by such Lenders in their sole discretion, twelve months) thereafter, as selected by the Borrower by irrevocable notice to the Administrative Agent not later than 11:00 A.M., New York City time, on the date that is three Business Days prior to the last day of the then current Interest Period with respect thereto; provided that, all of the foregoing provisions relating to Interest Periods are subject to the following:
(1)if any Interest Period would otherwise end on a day that is not a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless the result of such extension would be to carry such Interest Period into 

Exhibit 10.1

another calendar month in which event such Interest Period shall end on the immediately preceding Business Day;

(2)the Borrower may not select an Interest Period that would extend beyond the Revolving Credit Termination Date; and

(3)any Interest Period that begins on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period) shall end on the last Business Day of the calendar month at the end of such Interest Period.

“Investment”:  any advance, loan, extension of credit (by way of guaranty or otherwise) or capital contribution to, or purchase of any Capital Stock, bonds, notes, debentures or other debt securities of, or any assets constituting an ongoing business from, or any other investment in, any other Person.
“ISP”:  with respect to any Letter of Credit, the “International Standby Practices 1998” published by the Institute of International Banking Law & Practice, Inc. (or such later version thereof as may be in effect at the time of issuance).
“Issuing Lender”:  (i) Bank of America, N.A. or any Affiliate thereof; or (ii) any other Lender or any Affiliate thereof from time to time designated by the Borrower as an Issuing Lender with the consent of such Lender and the Administrative Agent.
“Joint Lead Arrangers”:  Merrill Lynch, Pierce, Fenner & Smith Incorporated (or its successors and permitted assigns) and Credit Suisse Securities (USA) LLC in their respective capacity as Joint Lead Arrangers.
“Laws”: collectively, all international, foreign, Federal, state and local statutes, treaties, rules, guidelines, regulations, ordinances, codes and administrative or judicial precedents or authorities, including the interpretation or administration thereof by any Governmental Authority charged with the enforcement, interpretation or administration thereof, and all applicable administrative orders, directed duties, requests, licenses, authorizations and permits of, and agreements with, any Governmental Authority, in each case whether or not having the force of law.
“L/C Borrowing”: an extension of credit resulting from a drawing under any Letter of Credit which has not been reimbursed on the date when made or refinanced as a Revolving Credit Borrowing.
“L/C Commitment”:  an amount equal to $50,000,000.
“L/C Credit Extension”: with respect to any Letter of Credit, the issuance thereof or extension of the expiry date thereof, or the increase of the amount thereof.
“L/C Fee Payment Date”:  the last day of each March, June, September and December, commencing on December 31, 2016, and the last day of the Revolving Credit Commitment Period.

Exhibit 10.1

“L/C Obligations”:  at any time, an amount equal to the sum of (a) the aggregate then undrawn and unexpired amount of the then outstanding Letters of Credit and (b) the aggregate amount of drawings under Letters of Credit that have not then been reimbursed pursuant to Section 3.5.  For all purposes of this Agreement, if on any date of determination a Letter of Credit has expired by its terms but any amount may still be drawn thereunder by reason of the operation of Rule 3.14 of the ISP, such Letter of Credit shall be deemed to be “outstanding” in the amount so remaining available to be drawn.
“L/C Participants”:  with respect to any Letter of Credit, the collective reference to all the Revolving Credit Lenders other than the Issuing Lender that issued such Letter of Credit.
“L/C Supportable Obligations”:  payment obligations of the Borrower and its Subsidiaries as permitted pursuant to Section 4.16.
“Lenders”:  as defined in the preamble hereto and, in any event, the term “Lenders” shall include any Issuing Bank (other than with respect to the definition of the Interest Period, Sections 2.13(b), 9.9(a), 10.1 (iv) and 10.1(ix)).  
“Letters of Credit”:  as defined in Section 3.1(a).
“Letter of Credit Expiration Date”: the day that is seven days prior to the Revolving Credit Termination Date then in effect (or, if such day is not a Business Day, the next preceding Business Day).
“Letter of Credit Fee”:  as defined in Section 3.3.
“Lien”:  any mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), charge or other security interest or any preference, priority or other security agreement or preferential arrangement of any kind or nature whatsoever (including any conditional sale or other title retention agreement and any capital lease having substantially the same economic effect as any of the foregoing).
“Loan”:  any loan made by any Lender pursuant to this Agreement.
“Loan Documents”:  collectively, this Agreement, the Applications and the Notes.
“Mandatory Redeemable Stock”:  with respect to any Person, any share of such Person’s Capital Stock, to the extent that it is (a) redeemable, payable or required to be purchased or otherwise retired or extinguished, or convertible into any Indebtedness or other liability, obligation, covenant or duty of or binding upon, or any term or condition to be observed by or binding upon such Person or any of its assets (except for consideration comprised of Capital Stock of such Person which is not Mandatory Redeemable Stock), (i) at a fixed or determinable date, whether by operation of a sinking fund or otherwise, (ii) at the option of any other Person or (iii) upon the occurrence of a condition not solely within the control of such Person such as a redemption required to be made utilizing future earnings, or (b) convertible into Capital Stock which has the features set forth in clause (a).

Exhibit 10.1

“Material Adverse Effect”:  a material adverse effect on (a) the business, assets, property, operations, condition (financial or otherwise) or prospects of the Borrower and its Subsidiaries taken as a whole, or (b) the validity or enforceability of this Agreement or any of the other Loan Documents or the rights or remedies of the Administrative Agent or the Lenders hereunder or thereunder.
“Materials of Environmental Concern”:  any gasoline or petroleum (including crude oil or any fraction thereof) or petroleum products, polychlorinated biphenyls, urea-formaldehyde insulation, asbestos, pollutants, contaminants, radioactivity, and any other substances or forces of any kind, whether or not any such substance or force is defined as hazardous or toxic under any Environmental Law, that is regulated pursuant to or could give rise to liability under any Environmental Law.
“Material Subsidiary”:  (i) each Subsidiary designated as a “Material Subsidiary” in Schedule 4.15, and (ii) each other Subsidiary whose total assets as of the end of any fiscal year equal or exceed $50,000,000.
“Montana First Mortgage Indenture”:  the Mortgage and Deed of Trust dated October 1, 1945 from the Borrower (as successor by merger to The Montana Power Company) to the trustees named therein, as supplemented and amended to the date hereof.
 “Montana Utility Business”:  the regulated electric and natural gas assets and businesses owned and operated by the Borrower in the State of Montana, or otherwise subject to the Lien of the Montana First Mortgage Indenture.
“Moody’s”:  Moody’s Investors Service, Inc., and any successor thereto.
“Multiemployer Plan”:  a Plan that is a multiemployer plan as defined in Section 4001(a)(3) of ERISA.
“New Lender”:  as defined in Section 2.1(c).
“New Lender Supplement”:  as defined in Section 2.1(c).
“Non-Excluded Taxes”:  as defined in Section 2.16(a).
“Non-U.S. Lender”:  as defined in Section 2.16(d).
“Note”:  any promissory note evidencing any Loan.
“Noticed Anniversary Date”: as defined in Section 2.1(e).
“Obligations”:  the unpaid principal of and interest on (including interest accruing after the maturity of the Loans and Reimbursement Obligations and interest accruing after the filing of any petition in bankruptcy, or the commencement of any insolvency, reorganization or like proceeding, relating to the Borrower, whether or not a claim for post-filing or post-petition interest is allowed in such proceeding) the Loans, the Reimbursement Obligations and all other obligations and liabilities of the Borrower to the Administrative Agent or to any Lender, whether 

Exhibit 10.1

direct or indirect, absolute or contingent, due or to become due, or now existing or hereafter incurred, which may arise under, out of, or in connection with, this Agreement, any other Loan Document, the Letters of Credit, or any other document made, delivered or given in connection herewith or therewith, whether on account of principal, interest, reimbursement obligations, fees, indemnities, costs, expenses (including all fees, charges and disbursements of counsel to the Administrative Agent or to any Lender that are required to be paid by the Borrower pursuant hereto) or otherwise.
“OFAC”: the Office of Foreign Assets Control of the United States Department of the Treasury.
“Original Credit Agreement”:  that certain Second Amended and Restated Credit Agreement dated as of November 5, 2013 among the Borrower, the Lenders party thereto and Bank of America, N.A., as Administrative Agent.
“Other Taxes”:  any and all present or future stamp or documentary taxes or any other excise or property taxes, charges or similar levies arising from any payment made hereunder or from the execution, delivery or enforcement of, or otherwise with respect to, this Agreement or any other Loan Document (except any such taxes imposed as a result of any assignment other than pursuant to Section 2.20) as a result of a present or former connection between the applicable Lender or Administrative Agent and the jurisdiction imposing such tax.
“Participant”:  as defined in Section 10.6(b).
“Participant Register”:  as defined in Section 10.6(b).
“Participation Amount”:  as defined in Section 3.4(b).
“Patriot Act”:  the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001).
“Payment Office”:  the office specified from time to time by the Administrative Agent as its payment office by notice to the Borrower and the Lenders.
“PBGC”:  the Pension Benefit Guaranty Corporation established pursuant to Subtitle A of Title IV of ERISA (or any successor).
“Person”:  an individual, partnership, corporation, limited liability company, business trust, joint stock company, trust, unincorporated association, joint venture, Governmental Authority or other entity of whatever nature.
“Plan”:  at a particular time, any employee benefit plan that is covered by ERISA and in respect of which the Borrower or a Commonly Controlled Entity is (or, if such plan were terminated at such time, would under Section 4069 of ERISA be deemed to be) an “employer” as defined in Section 3(5) of ERISA.
“Platform”:  as defined in Section 10.1.

Exhibit 10.1

“Pricing Grid”:  the pricing grid attached hereto as Annex A.
“Pricing Level”:  each of “Pricing Level I” through “Pricing Level V” set forth in the Pricing Grid.
“Property”:  any right or interest in or to property of any kind whatsoever, whether real, personal or mixed and whether tangible or intangible, including Capital Stock.
“Rating Agencies”:  Fitch, Standard & Poor’s and Moody’s.
“Register”:  as defined in Section 10.6(d).
“Regulation U”:  Regulation U of the Board as in effect from time to time.
“Reimbursement Obligation”:  the obligation of the Borrower to reimburse each Issuing Lender pursuant to Section 3.5 for amounts drawn under Letters of Credit issued by such Issuing Lender.
“Related Fund”:  with respect to any Lender, any Person (other than an individual) that (x) is (or will be) engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of its activities and (y) is managed or administered by such Lender, an Affiliate of such Lender or an entity or an Affiliate of an entity that administers or manages such Lender.
“Reorganization”:  with respect to any Multiemployer Plan, the condition that such plan is in reorganization within the meaning of Section 4241 of ERISA.
“Reportable Event”:  any of the events set forth in Section 4043(c) of ERISA, other than those events as to which the thirty day notice period is waived under subsections .27, .28, .29, .30, .31, .32, .34 or .35 of PBGC Reg. § 4043.
“Required Lenders”:  at any time, the holders of more than 50% of the Total Revolving Credit Commitments then in effect or, if the Revolving Credit Commitments have been terminated, the Total Revolving Extensions of Credit then outstanding, in each case excluding the aggregate Revolving Credit Commitments of, and Revolving Extensions of Credit made by, Defaulting Lenders.
“Requirement of Law”:  as to any Person, the certificate of incorporation and by‐laws or other organizational or governing documents of such Person, and any law, treaty, rule or regulation or determination of an arbitrator or a court or other Governmental Authority, in each case applicable to or binding upon such Person or any of its Property or to which such Person or any of its Property is subject.
“Responsible Officer”:  as to any Person, the chief executive officer, president or chief financial officer of such Person, but in any event, with respect to financial matters, the chief financial officer, treasurer or assistant treasurer of such Person, or any other officer of such Person designated as a Responsible Officer by any one of the foregoing, and, solely for purposes of notices given pursuant to Section 2, any other officer or employee of such Person so 

Exhibit 10.1

designated by any of the foregoing officers in a notice to the Administrative Agent or any other officer or employee of such Person designated in or pursuant to an agreement between such Person and the Administrative Agent. 
“Revolving Credit Commitment”:  as to any Lender, the obligation of such Lender, if any, to make Revolving Credit Loans and participate in Letters of Credit, in an aggregate principal and/or face amount not to exceed the amount set forth under the heading “Revolving Credit Commitment” opposite such Lender’s name on the Commitment Appendix attached hereto, or, as the case may be, in the assignment and acceptance or New Lender Supplement pursuant to which such Lender became a party hereto, as the same may be changed from time to time pursuant to the terms hereof pursuant to Section 2.1(b).  The original aggregate amount of the Total Revolving Credit Commitments is $400,000,000.
“Revolving Credit Commitment Period”:  the period from and including the Closing Date to the Revolving Credit Termination Date.
“Revolving Credit Facility”:  as defined in the definition of “Facility” in this Section 1.1.
“Revolving Credit Lender”:  each Lender that has a Revolving Credit Commitment or that is the holder of Revolving Credit Loans.
“Revolving Credit Loans”:  as defined in Section 2.1.
“Revolving Credit Note”:  as defined in Section 2.5.
“Revolving Credit Percentage”:  as to any Revolving Credit Lender at any time, the percentage which such Lender’s Revolving Credit Commitment then constitutes of the Total Revolving Credit Commitments (or, at any time after the Revolving Credit Commitments shall have expired or terminated, the percentage which the aggregate amount of such Lender’s Revolving Extensions of Credit then outstanding constitutes of the Total Revolving Extensions of Credit then outstanding).
“Revolving Credit Termination Date”: December 12, 2021 or, subject to the terms of Section 2.1(e), the Extended Revolving Termination Date or the Second Extended Revolving Termination Date, as applicable.
“Revolving Extensions of Credit”:  as to any Revolving Credit Lender at any time, an amount equal to the sum of (a) the aggregate principal amount of all Revolving Credit Loans made by such Lender then outstanding and (b) such Lender’s Revolving Credit Percentage of the L/C Obligations then outstanding.
“Sanctions”: as defined in Section 4.19(b)(i).
“SEC”:  the Securities and Exchange Commission (or successors thereto or an analogous Governmental Authority).
“SEC Reports”:  the publicly available (unredacted) portion of all reports filed by the Borrower with the SEC on Form 10-K, Form 10-Q or Form 8-K or any successor form.

Exhibit 10.1

“Second Extended Revolving Termination Date”:  as defined in Section 2.1(e).
“Single Employer Plan”:  any Plan that is covered by Title IV of ERISA, but which is not a Multiemployer Plan.
“Solvent”:  with respect to any Person, as of any date of determination, (a) the “present fair saleable value” of the assets of such Person will, as of such date, exceed the amount of all “liabilities of such Person, contingent or otherwise”, as of such date, (b) the present fair saleable value of the assets of such Person will, as of such date, be greater than the amount that will be required to pay the probable liability of such Person on its debts as such debts become absolute and matured, (c) such Person will not have, as of such date, an unreasonably small amount of capital with which to conduct its business, and (d) such Person will be able to pay its debts as they mature.  For purposes of this definition, (i) “debt” means liability on a “claim”, and (ii) “claim” means any (x) right to payment, whether or not such a right is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured or unsecured or (y) right to an equitable remedy for breach of performance if such breach gives rise to a right to payment, whether or not such right to an equitable remedy is reduced to judgment, fixed, contingent, matured or unmatured, disputed, undisputed, secured or unsecured.
“South Dakota First Mortgage Indenture”:  the General Mortgage Indenture and Deed of Trust dated as of August 1, 1993 between the Borrower and The Chase Manhattan Bank, as trustee, as supplemented and amended to the date hereof.
“South Dakota Utility Business”:  the regulated electric and natural gas assets and businesses owned and operated by the Borrower in the States of South Dakota and Nebraska and all of the Borrower’s other assets that are subject to the Lien of the South Dakota First Mortgage Indenture (which consists principally, as of the date hereof, of the shared ownership interests in electric generation facilities located in the States of North Dakota and Iowa).
“SPC”: as defined in Section 10.6(j).
“Standard & Poor’s”:  Standard & Poor’s Financial Services LLC, a subsidiary of S&P Global Inc. and any successor thereto.
“Stated Maturity”:  with respect to any installment of interest or principal on any series of Indebtedness, the date on which the payment of interest or principal was scheduled to be paid in the original documentation governing such Indebtedness, and will not include any contingent obligations to repay, redeem or repurchase any such interest or principal prior to the date originally scheduled for the payment thereof.
“Subsidiary”:  as to any Person, a corporation, partnership, limited liability company or other entity of which shares of stock or other ownership interests having ordinary voting power (other than stock or such other ownership interests having such power only by reason of the happening of a contingency) to elect a majority of the board of directors or other managers of such corporation, partnership or other entity are at the time owned, or the management of which is otherwise controlled, directly or indirectly through one or more intermediaries, or both, by 

Exhibit 10.1

such Person.  Unless otherwise qualified, all references to a “Subsidiary” or to “Subsidiaries” in this Agreement shall refer to a Subsidiary or Subsidiaries of the Borrower.
“Syndication Agent”:  Credit Suisse Securities (USA) LLC.
“Total Revolving Credit Commitments”:  at any time, the aggregate amount of the Revolving Credit Commitments then in effect.
“Total Revolving Extensions of Credit”:  at any time, the aggregate amount of the Revolving Extensions of Credit of the Revolving Credit Lenders outstanding at such time.
“Transferee”:  as defined in Section 10.14.
“Type”:  as to any Loan, its nature as a Base Rate Loan or a Eurodollar Loan. 
“UCP”:  with respect to any Letter of Credit, the Uniform Customs and Practice for Documentary Credits, International Chamber of Commerce (“ICC”) Publication No. 600 (or such later version thereof as may be in effect at the time of issuance).
“Utility Business”:  the regulated electric and natural gas utility business and operations of the Borrower and its Subsidiaries.
“Write-Down and Conversion Powers”:  with respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule. 
1.2    Other Definitional Provisions.  (a)    Unless otherwise specified therein, all terms defined in this Agreement shall have the defined meanings when used in the other Loan Documents or any certificate or other document made or delivered pursuant hereto or thereto.
(a)As used herein and in the other Loan Documents, and any certificate or other document made or delivered pursuant hereto or thereto, accounting terms relating to the Borrower and its Subsidiaries not defined in Section 1.1 and accounting terms partly defined in Section 1.1, to the extent not defined, shall have the respective meanings given to them under GAAP.
(b)The words “hereof”, “herein” and “hereunder” and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement, and Section, Schedule and Exhibit references are to this Agreement unless otherwise specified.
(c)The meanings given to terms defined herein shall be equally applicable to both the singular and plural forms of such terms.
(d)All calculations of financial ratios set forth in Section 7.1 shall be calculated to the same number of decimal places as the relevant ratios are expressed in and shall be rounded upward if the number in the decimal place immediately following the last calculated decimal place is five or greater.  For example, if the relevant ratio is to be calculated to the hundredth decimal place and the calculation of the ratio is 5.126, the ratio will be rounded up to 5.13.

Exhibit 10.1

(e)The words “include,” “includes” and “including” shall be deemed to be followed by the phrase “without limitation”.  The word “or” shall not be exclusive.  The word “will” shall be construed to have the same meaning and effect as the word “shall”.
(f)Unless the context requires otherwise (i) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein), (ii) any reference herein to any Person shall be construed to include such Person’s successors and assigns, and (iii) the words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights.
SECTION 2.  AMOUNT AND TERMS OF COMMITMENTS
2.1.Revolving Credit Commitments.  (a)  Subject to the terms and conditions hereof, the Revolving Credit Lenders severally agree to make revolving credit loans (“Revolving Credit Loans”) to the Borrower from time to time during the Revolving Credit Commitment Period in an aggregate principal amount at any one time outstanding for each Revolving Credit Lender which, when added to such Lender’s Revolving Credit Percentage of the L/C Obligations then outstanding does not exceed the amount of such Lender’s Revolving Credit Commitment.  During the Revolving Credit Commitment Period the Borrower may use the Revolving Credit Commitments by borrowing, prepaying the Revolving Credit Loans in whole or in part, and reborrowing, all in accordance with the terms and conditions hereof.  The Revolving Credit Loans may from time to time be Eurodollar Loans or Base Rate Loans, as determined by the Borrower and notified to the Administrative Agent in accordance with Sections 2.5 and 2.13; provided that no Revolving Credit Loan shall be made as a Eurodollar Loan after the day that is one month prior to the Revolving Credit Termination Date.
(a)At any time, the Borrower and any one or more Lenders (including New Lenders) may agree that such Lender(s) shall make, obtain or increase the amount of their Revolving Credit Commitments by executing and delivering to the Administrative Agent an Increased Revolving Commitment Activation Notice specifying the amount of such increase and the applicable Increased Revolving Commitment Closing Date.  Notwithstanding the foregoing, (i) the aggregate amount of incremental Revolving Credit Commitments obtained pursuant to this Section 2.1(b) shall not exceed $50,000,000, (ii) incremental Revolving Credit Commitments may not be made, obtained or increased until all of the conditions precedent in Section 5.2 have been satisfied and (iii) the increase effected pursuant to this paragraph shall be in a minimum amount of at least $10,000,000.  No Lender shall have any obligation to participate in any increase described in this paragraph unless it agrees to do so in its sole discretion.
(b)Any additional bank, financial institution or other entity which, with the consent of the Borrower and the Administrative Agent, elects to become a “Lender” under this Agreement in connection with an increase described in Section 2.1(b) shall execute a New Lender Supplement (each, a “New Lender Supplement”), substantially in the form of Exhibit H, whereupon such bank, financial institution or other entity (a “New Lender”) shall become a Lender for all purposes and to the same extent as if originally a party hereto and shall be bound by and entitled to the benefits of this Agreement.

Exhibit 10.1

(c)On each Increased Revolving Commitment Closing Date on which there are Revolving Credit Loans outstanding, the New Lender(s) and/or Lender(s) that have increased their Revolving Credit Commitments shall make Revolving Credit Loans, the proceeds of which will be used to prepay such portions of the Revolving Credit Loans of other Lenders, so that, after giving effect thereto, the resulting Revolving Credit Loans outstanding are allocated among the Lenders in accordance with Section 2.14(a) based on the respective Revolving Credit Percentages of the Lenders after giving effect to such Increased Revolving Commitment Closing Date.
(d)The Borrower shall repay all outstanding Revolving Credit Loans on the Revolving Credit Termination Date.  The Borrower may request (each, an “Extension Request”) that the Revolving Credit Commitments and L/C Commitments be extended for additional one-year periods by providing written notice to the Administrative Agent not more than 90 days, but not fewer than 30 days, prior to two of the first four anniversaries of the Closing Date (each, a “Noticed Anniversary Date”); provided that, in no event shall more than two Extension Requests be made.  If a Lender agrees, in its individual and sole discretion, to extend its Revolving Credit Commitments and/or L/C Commitments (such Lender, an “Extending Lender”), it will notify the Administrative Agent in writing of its decision to do so and the maximum amount of Revolving Credit Commitments and, if applicable, L/C Commitments it agrees to so extend no later than 20 days prior to the applicable Noticed Anniversary Date, which notice shall be irrevocable.  The Administrative Agent will notify the Borrower, in writing, of the Lenders’ decisions no later than 15 days prior to such Noticed Anniversary Date.  The Extending Lenders’ Revolving Credit Commitments and L/C Commitments will be extended for an additional year from the Revolving Termination Date (the “Extended Revolving Termination Date”) or the Extended Revolving Termination Date (the “Second Extended Revolving Termination Date”), as applicable; provided that (i) Lenders holding more than 50% of the aggregate Revolving Credit Commitments outstanding on the applicable Noticed Anniversary Date have agreed to so extend their respective Revolving Credit Commitments (but only with respect to the Revolving Credit Commitments of each Lender that votes in its sole discretion to so extend its Revolving Credit Commitments) and (ii) no Default or Event of Default shall have occurred and be continuing on the applicable Noticed Anniversary Date after giving effect to the requested extension.  No Lender shall be required to consent to any such Extension Request, and any Lender that declines or does not respond in writing to the Borrower’s request for commitment renewal (a “Declining Lender”) will have its Revolving Credit Commitments and L/C Commitments terminated on the then-existing Revolving Termination Date or Extended Revolving Termination Date, as applicable (without regard to any renewals by other Lenders).  The Borrower will have the right to remove or replace any Declining Lenders in accordance with Section 2.20.  If an Extension Request has become effective hereunder, on the then-existing Revolving Credit Termination Date, (i) the Borrower shall make payments of Loans and/or Cash Collateralize the L/C 

Exhibit 10.1

Obligations in an aggregate amount sufficient to reduce the Total Revolving Extensions of Credit as of such date of payment to an amount not to exceed one hundred percent (100%) of the Total Revolving Credit Commitments then in effect of the Extending Lenders extended pursuant to this Section 2.1(e) (and the Borrower shall not be permitted thereafter to request any Loan or any issuance, amendment, renewal or extension of a Letter of Credit if, after giving effect thereto, the Total Revolving Extensions of Credit of all Loans and all L/C Obligations would exceed the aggregate amount of the Total Revolving Credit Commitments so extended), and (ii) the Revolving Credit Commitment of each Declining Lender shall terminate, and the Borrowers shall repay all the Loans of each Declining Lender, together with accrued and unpaid interest and all fees and other amounts owing to such Declining Lender hereunder, it being understood and agreed that such repayments may be funded with the proceeds of new Borrowings made simultaneously with such repayments by the Extending Lenders, which such Borrowings shall be made ratably by the Extending Lenders in accordance with their extended Revolving Credit Commitments.  Notwithstanding any provision of this Agreement to the contrary, it is hereby agreed that no extension of a maturity date in accordance with the express terms of this Section 2.1(e), or any amendment or modification of the terms and conditions of the Revolving Credit Commitments and the Loans of the Extending Lenders effected pursuant thereto, shall be deemed to violate Section 2.7 or any other provision of this Agreement requiring the ratable reduction of Revolving Credit Commitments.  This Section 2.1(e) shall supersede anything in Section 10.1 to the contrary.
2.2.Procedure for Revolving Credit Borrowing.  The Borrower may borrow under the Revolving Credit Commitments on any Business Day during the Revolving Credit Commitment Period; provided that the Borrower shall deliver to the Administrative Agent irrevocable notice, which may be given by (A) telephone or (B) a Borrowing Notice (which Borrowing Notice must be received by the Administrative Agent prior to 12:00 Noon, New York City time, (a) three Business Days prior to the requested Borrowing Date, in the case of Eurodollar Loans, or (b) on the requested Borrowing Date, in the case of Base Rate Loans).  Any Revolving Credit Loans made on the Closing Date shall initially be Base Rate Loans.  Except as provided in Section 3.5, each borrowing of Revolving Credit Loans under the Revolving Credit Commitments shall be in an amount equal to (x) in the case of Base Rate Loans, $1,000,000 or a whole multiple of $100,000 in excess thereof (or, if the then aggregate Available Revolving Credit Commitments are less than $1,000,000, such lesser amount) and (y) in the case of Eurodollar Loans, $5,000,000 or a whole multiple of $1,000,000 in excess thereof.  Any telephonic notice by the Borrower must be confirmed immediately by delivery to the Administrative Agent of a Borrowing Notice specifying therein the requested (i) date of such Borrowing, (ii) the amount of Loans requested, (iii) Type of Loans comprising such Borrowing, (iv) Borrower’s account for such Loans and (v) in the case of any Loans requested to be made as Eurodollar Loans, the initial Interest Period therefor.  If no election as to the Type of Loans is specified in the Borrowing Notice, then the requested Loans shall be Base Rate Loans.  If no Interest Period with respect to any Eurodollar Loans is specified in any such Borrowing Notice, then the Borrower shall be deemed to have selected an Interest Period of one month’s duration.  Upon receipt of any such Borrowing Notice from the Borrower, the Administrative Agent shall promptly notify each Revolving Credit Lender thereof.  Each Revolving Credit Lender will make its Revolving Credit Percentage of the amount of each borrowing of Revolving Credit Loans available to the Administrative Agent for the account of the Borrower at the Funding Office prior to 3:00 PM, New York City time, on the Borrowing Date requested by the Borrower in funds 

Exhibit 10.1

immediately available to the Administrative Agent.  Such borrowing will then be made available to the Borrower by the Administrative Agent in like funds as received by the Administrative Agent.
2.3.[Reserved]
2.4.[Reserved]
2.5.Repayment of Loans; Evidence of Debt.  (a)  The Borrower hereby unconditionally promises to pay to the Administrative Agent for the account of the appropriate Revolving Credit Lender the then unpaid principal amount of each Revolving Credit Loan of such Revolving Credit Lender on the Revolving Credit Termination Date (or on such earlier date on which the Loans become due and payable pursuant to Section 8).  The Borrower hereby further agrees to pay interest on the unpaid principal amount of the Loans from time to time outstanding from the date hereof until payment in full thereof at the rates per annum, and on the dates, set forth in Section 2.11.
(a)Each Lender shall maintain in accordance with its usual practice an account or accounts evidencing indebtedness of the Borrower to such Lender resulting from each Loan of such Lender from time to time, including the amounts of principal and interest payable and paid to such Lender from time to time under this Agreement.
(b)The Administrative Agent, on behalf of the Borrower, shall maintain the Register pursuant to Section 10.6(d), and a subaccount therein for each Lender, in which shall be recorded (i) the amount of each Loan made hereunder and any Note evidencing such Loan, the Type of such Loan and each Interest Period applicable thereto, (ii) the amount of any principal or interest due and payable or to become due and payable from the Borrower to each Lender hereunder and (iii) both the amount of any sum received by the Administrative Agent hereunder from the Borrower and each Lender’s share thereof.
(c)The entries made in the Register and the accounts of each Lender maintained pursuant to Section 2.5(b) shall, to the extent permitted by applicable law, be prima facie evidence of the existence and amounts of the obligations of the Borrower therein recorded; provided, however, that the failure of any Lender or the Administrative Agent to maintain the Register or any such account, or any error therein, shall not in any manner affect the obligation of the Borrower to repay (with applicable interest) the Loans made to the Borrower by such Lender in accordance with the terms of this Agreement.
(d)The Borrower agrees that, upon its receipt of notice of the request to the Administrative Agent by any Lender, the Borrower will promptly execute and deliver to such Lender a promissory note of the Borrower evidencing any Revolving Credit Loans of such Lender, substantially in the form of Exhibit C (a “Revolving Credit Note”), with appropriate insertions as to date and then outstanding principal amount; provided, that delivery of Notes shall not be a condition precedent to the occurrence of the Closing Date or the making of the Loans or issuance of Letters of Credit on the Closing Date.
2.6.Commitment Fees, etc.  (a)  The Borrower agrees to pay to the Administrative Agent for the account of each Revolving Credit Lender a commitment fee for the 

Exhibit 10.1

period from and including the Closing Date to the last day of the Revolving Credit Commitment Period, computed at the Commitment Fee Rate on the average daily amount of the Available Revolving Credit Commitment of such Lender during the period for which payment is made, payable quarterly in arrears on the last day of each March, June, September and December and on the Revolving Credit Termination Date, commencing on the first of such dates to occur after the date hereof; provided, however, that no Commitment Fee shall accrue on any of the Revolving Credit Commitment of a Defaulting Lender so long as such Lender shall be a Defaulting Lender.  
(b)    The Borrower agrees to pay to the Administrative Agent the fees in the amounts and on the dates agreed to in the Fee Letters (or otherwise from time to time agreed to in writing by the Borrower and the Administrative Agent).
2.7.Termination or Reduction of Revolving Credit Commitments.  The Borrower shall have the right, upon not less than three Business Days’ notice to the Administrative Agent, without premium or penalty, to terminate the Revolving Credit Commitments or, from time to time, to reduce the aggregate amount of the Revolving Credit Commitments; provided that no such termination or reduction of Revolving Credit Commitments shall be permitted if, after giving effect thereto and to any prepayments of the Revolving Credit Loans made on the effective date thereof, the Total Revolving Extensions of Credit would exceed the Total Revolving Credit Commitments.  Any such reduction shall be in an amount equal to $1,000,000, or a whole multiple thereof, and shall reduce permanently the Revolving Credit Commitments then in effect.
2.8.Optional Prepayments.  The Borrower may at any time and from time to time prepay the Loans, in whole or in part, without premium or penalty (but including breakage costs, if any, pursuant to Section 2.17), upon irrevocable notice delivered to the Administrative Agent no later than 11:00 A.M., New York City time, three Business Days prior thereto in the case of Eurodollar Loans and no later than 11:00 A.M., New York City time, one Business Day prior thereto in the case of Base Rate Loans, which notice shall specify the date and amount of such prepayment and whether such prepayment is of Eurodollar Loans or Base Rate Loans; provided, that if a Eurodollar Loan is prepaid on any day other than the last day of the Interest Period applicable thereto, the Borrower shall also pay any amounts owing pursuant to Section 2.17.  Upon receipt of any such notice the Administrative Agent shall promptly notify each relevant Lender thereof.  If any such notice is given, the amount specified in such notice shall be due and payable on the date specified therein, together with (except in the case of Revolving Credit Loans that are Base Rate Loans) accrued interest to such date on the amount prepaid.  Partial prepayments of Revolving Credit Loans shall be in an aggregate principal amount of $1,000,000 or a whole multiple thereof.  
2.9.Conversion and Continuation Options.  (a)  The Borrower may elect from time to time to convert Eurodollar Loans to Base Rate Loans by giving the Administrative Agent at least one Business Day prior irrevocable notice of such election; provided that any such conversion of Eurodollar Loans may be made only on the last day of an Interest Period with respect thereto.  The Borrower may elect from time to time to convert Base Rate Loans to Eurodollar Loans by giving the Administrative Agent irrevocable notice of such election no later than 12:00 noon, New York City time, three Business Days prior thereto (which notice shall 

Exhibit 10.1

specify the length of the initial Interest Period therefor); provided that no Base Rate Loan may be converted into a Eurodollar Loan (i) when any Event of Default has occurred and is continuing and the Administrative Agent has, or the Required Lenders have, determined in its or their sole discretion not to permit such conversions or (ii) after the date that is one month prior to the final scheduled termination or maturity date of the Facility.  Upon receipt of any such notice the Administrative Agent shall promptly notify each Lender thereof.
(b)    The Borrower may elect to continue any Eurodollar Loan as such upon the expiration of the then current Interest Period with respect thereto by giving irrevocable notice to the Administrative Agent, in accordance with the applicable provisions of the term “Interest Period” set forth in Section 1.1, of the length of the next Interest Period to be applicable to such Loan; provided that no Eurodollar Loan under the Facility may be continued as such (i) when any Event of Default has occurred and is continuing and the Administrative Agent has, or the Required Lenders have, determined in its or their sole discretion not to permit such continuations or (ii) after the date that is one month prior to the final scheduled termination or maturity date of the Facility; and provided, further, that if the Borrower shall fail to give any required notice as described above in this paragraph or if such continuation is not permitted pursuant to the preceding proviso, such Loans shall be converted automatically to Base Rate Loans on the last day of such then expiring Interest Period.  Upon receipt of any such notice the Administrative Agent shall promptly notify each relevant Lender thereof.
2.10.Minimum Amounts and Maximum Number of Eurodollar Tranches.  Notwithstanding anything to the contrary in this Agreement, all borrowings, conversions, continuations and optional prepayments of Eurodollar Loans and all selections of Interest Periods shall be in such amounts and be made pursuant to such elections so that, (a) after giving effect thereto, the aggregate principal amount of the Eurodollar Loans comprising each Eurodollar Tranche shall be equal to $5,000,000 or a whole multiple of $1,000,000 in excess thereof and (b) no more than ten Eurodollar Tranches shall be outstanding at any one time.
2.11.Interest Rates and Payment Dates.  (a)  Each Eurodollar Loan shall bear interest for each day during each Interest Period with respect thereto at a rate per annum equal to the Eurodollar Rate applicable to such Eurodollar Loan plus the Applicable Margin with respect to Eurodollar Loans in effect for such day.
(b)Each Base Rate Loan shall bear interest for each day on which it is outstanding at a rate per annum equal to the Base Rate in effect for such day plus the Applicable Margin with respect to Base Rate Loans in effect for such day.
(c)[Reserved]
(d)(i) If all or a portion of the principal amount of any Loan or Reimbursement Obligation shall not be paid when due (whether at the stated maturity, by acceleration or otherwise), all outstanding Loans and Reimbursement Obligations (whether or not overdue)(to the extent legally permitted) shall bear interest at a rate per annum that is equal to (x) in the case of the Loans, the rate that would otherwise be applicable thereto pursuant to the foregoing provisions of this Section plus 2% or (y) in the case of Reimbursement Obligations, the rate applicable to Base Rate Loans (including the Applicable Margin) plus 2%, and (ii) if all 

Exhibit 10.1

or a portion of any interest payable on any Loan or Reimbursement Obligation or any commitment fee or other amount payable hereunder shall not be paid when due (whether at the stated maturity, by acceleration or otherwise), such overdue amount shall bear interest at a rate per annum equal to the rate then applicable to Base Rate Loans (including the Applicable Margin) plus 2%, in each case, with respect to clauses (i) and (ii) above, from the date of such non‐payment until such amount is paid in full (after as well as before judgment).
(e)Interest shall be payable in arrears on each Interest Payment Date; provided that interest accruing pursuant to paragraph (d) of this Section shall be payable from time to time on demand.
2.12.Computation of Interest and Fees.  (a)  Interest, fees and commissions payable pursuant hereto shall be calculated on the basis of a 360-day year for the actual days elapsed, except that, with respect to Base Rate Loans on which interest is calculated on the basis of the Prime Rate, the interest thereon shall be calculated on the basis of a 365- (or 366-, as the case may be) day year for the actual days elapsed.  The Administrative Agent shall as soon as practicable notify the Borrower and the relevant Lenders of each determination of a Eurodollar Rate.  Any change in the interest rate on a Loan resulting from a change in the Base Rate or the Eurocurrency Reserve Requirements shall become effective as of the opening of business on the day on which such change becomes effective.  The Administrative Agent shall as soon as practicable notify the Borrower and the relevant Lenders of the effective date and the amount of each such change in interest rate.
(b)Each determination of an interest rate by the Administrative Agent pursuant to any provision of this Agreement shall be conclusive and binding on the Borrower and the Lenders in the absence of manifest error.  The Administrative Agent shall, at the request of the Borrower, deliver to the Borrower a statement showing the quotations used by the Administrative Agent in determining any interest rate pursuant to Section 2.11(a).
2.13.Inability to Determine Interest Rate.  If prior to the first day of any Interest Period:
(a)the Administrative Agent shall have reasonably determined (which determination shall be conclusive and binding upon the Borrower) that adequate and reasonable means do not exist for ascertaining the Eurodollar Rate for such Interest Period, or
(b)the Administrative Agent shall have received notice from the Required Lenders that the Eurodollar Rate determined or to be determined for such Interest Period will not adequately and fairly reflect the cost to such Lenders (as conclusively certified by such Lenders) of making or maintaining their affected Loans during such Interest Period,
the Administrative Agent shall give telecopy or telephonic notice thereof to the Borrower and the Lenders as soon as practicable thereafter.  If such notice is given (x) any Eurodollar Loans requested to be made on the first day of such Interest Period shall be made as Base Rate Loans, (y) any Loans that were to have been converted on the first day of such Interest Period to Eurodollar Loans shall be continued as Base Rate Loans and (z) any outstanding Eurodollar Loans shall be converted, on the last day of the then current Interest Period with respect thereto, to Base Rate Loans.  Until such notice has been withdrawn by the Administrative Agent, no further Eurodollar Loans shall be made or continued as such, nor shall the Borrower have the right to convert Loans to Eurodollar Loans.
2.14.Pro Rata Treatment and Payments.  (a)  Each borrowing by the Borrower from the Lenders hereunder, each payment by the Borrower on account of any commitment fee or Letter of Credit Fee, and any reduction of the Revolving Credit Commitments of the Lenders, shall be made pro rata 

Exhibit 10.1

according to the Revolving Credit Percentages of the Lenders.  Each payment of interest in respect of the Loans and each payment in respect of fees payable hereunder shall be applied to the amounts of such obligations owing to the applicable Lenders pro rata according to the respective amounts then due and owing to such Lenders.
(b)Each payment (including each prepayment) by the Borrower on account of principal of the Revolving Credit Loans shall be made pro rata according to the respective outstanding principal amounts of the Revolving Credit Loans then held by the Revolving Credit Lenders.  Each payment in respect of Reimbursement Obligations in respect of any Letter of Credit shall be made to the Issuing Lender that issued such Letter of Credit.  
(c)The application of any payment of Loans under the Facility (including optional and mandatory prepayments) shall be made, first, to Base Rate Loans under the Facility and, second, to Eurodollar Loans under the Facility.  Each payment of the Loans (except in the case of Revolving Credit Loans that are Base Rate Loans) shall be accompanied by accrued interest to the date of such payment on the amount paid.
(d)All payments (including prepayments) to be made by the Borrower hereunder, whether on account of principal, interest, fees or otherwise, shall be made without setoff or counterclaim and shall be made prior to 12:00 Noon, New York City time, on the due date thereof to the Administrative Agent, for the account of the relevant Lenders, at the Payment Office, in Dollars and in immediately available funds.  Any payment made by the Borrower after 12:00 Noon, New York City time, on any Business Day shall be deemed to have been on the next following Business Day.  Except as otherwise provided herein, if any payment hereunder becomes due and payable, or the performance of any covenant, duty or obligation is stated to be due or required, on a day other than a Business Day, such payment or performance shall be extended to the next succeeding Business Day.  If any payment on a Eurodollar Loan becomes due and payable on a day other than a Business Day, the maturity thereof shall be extended to the next succeeding Business Day unless the result of such extension would be to extend such payment into another calendar month, in which event such payment shall be made on the immediately preceding Business Day.  In the case of any extension of any payment of principal pursuant to the preceding two sentences, interest thereon shall be payable at the then applicable rate during such extension.
(e)Unless the Administrative Agent shall have been notified in writing by any Lender prior to a borrowing that such Lender will not make the amount that would constitute its share of such borrowing available to the Administrative Agent, the Administrative Agent may assume that such Lender is making such amount available to the Administrative Agent, and the 

Exhibit 10.1

Administrative Agent may, in reliance upon such assumption, make available to the Borrower a corresponding amount.  If such amount is not made available to the Administrative Agent by the required time on the Borrowing Date therefor, such Lender shall pay to the Administrative Agent, on demand, such amount with interest thereon at a rate equal to the greater of (i) the Federal Funds Effective Rate and (ii) a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation, for the period until such Lender makes such amount immediately available to the Administrative Agent.  A certificate of the Administrative Agent submitted to any Lender with respect to any amounts owing under this paragraph shall be conclusive in the absence of manifest error.  If such Lender’s share of such borrowing is not made available to the Administrative Agent by such Lender within three Business Days after such Borrowing Date, the Administrative Agent shall also be entitled to recover such amount with interest thereon at the rate per annum applicable to Base Rate Loans under the Facility, on demand, from the Borrower.
(f)Unless the Administrative Agent shall have been notified in writing by the Borrower prior to the date of any payment due to be made by the Borrower hereunder that the Borrower will not make such payment to the Administrative Agent, the Administrative Agent may assume that the Borrower is making such payment, and the Administrative Agent may, but shall not be required to, in reliance upon such assumption, make available to the Lenders their respective pro rata shares of a corresponding amount.  If such payment is not made to the Administrative Agent by the Borrower within three Business Days after such due date, the Administrative Agent shall be entitled to recover, on demand, from each Lender to which any amount which was made available pursuant to the preceding sentence, such amount with interest thereon at the rate per annum equal to the greater of (i) the Federal Funds Effective Rate and (ii) a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation, for the period until such Lender makes such amount immediately available to the Administrative Agent.  Nothing herein shall be deemed to limit the rights of the Administrative Agent or any Lender against the Borrower.
(g)Subject to Section 2.21(a)(ii), upon receipt by the Administrative Agent of payments on behalf of Lenders, the Administrative Agent shall promptly distribute such payments to the Lender or Lenders entitled thereto, in like funds as received by the Administrative Agent.
(h)Failure to Satisfy Conditions Precedent.  If any Lender makes available to the Administrative Agent funds for any Loan to be made by such Lender as provided in the foregoing provisions of this Section 2, and such funds are not made available to the Borrower by the Administrative Agent because the conditions to the applicable extension of credit set forth in Section 5 are not satisfied or waived in accordance with the terms hereof, the Administrative Agent shall return such funds (in like funds as received from such Lender) to such Lender, without interest.
(i)Obligations of Lenders Several.  The obligations of the Lenders hereunder to make Loans and to fund participations in Letters of Credit are several and not joint.  The failure of any Lender to make any Loan or to fund any L/C Participation on any date required hereunder shall not relieve any other Lender of its corresponding obligation to do so on such 

Exhibit 10.1

date, and no Lender shall be responsible for the failure of any other Lender to so make its Loan or to purchase its L/C Participation.
(j)Funding Source.  Nothing herein shall be deemed to obligate any Lender to obtain the funds for any Loan in any particular place or manner or to constitute a representation by any Lender that it has obtained or will obtain the funds for any Loan in any particular place or manner.
2.15.Requirements of Law.  (a)    If the adoption of or any change in any Requirement of Law or in the interpretation, implementation or application thereof or compliance by any Lender with any request or directive (whether or not having the force of law) from any central bank or other Governmental Authority made subsequent to the date hereof:
(i)shall subject any Lender to any tax of any kind whatsoever with respect to any Loan Document, any Letter of Credit, any Application or any Loan made by it, or change the basis of taxation of payments to such Lender in respect thereof (except for Non-Excluded Taxes covered by Section 2.16 and changes in the rate of tax on the overall net income of such Lender);
(ii)shall impose, modify or hold applicable any reserve, special deposit, compulsory loan or similar requirement against assets held by, deposits or other liabilities in or for the account of, advances, loans or other extensions of credit by, or any other acquisition of funds by, any office of such Lender that is not otherwise included in the determination of the Eurodollar Rate hereunder; or
(iii)shall impose on such Lender any other condition;
and the result of any of the foregoing is to increase the cost to such Lender, by an amount which such Lender deems to be material, of making, converting into, continuing or maintaining Loans or issuing or participating in Letters of Credit, or to reduce any amount receivable hereunder in respect thereof, then, in any such case, the Borrower shall promptly pay such Lender, upon its demand, any additional amounts necessary to compensate such Lender for such increased cost or reduced amount receivable.  If any Lender becomes entitled to claim any additional amounts pursuant to this Section, it shall promptly notify the Borrower (with a copy to the Administrative Agent) of the event by reason of which it has become so entitled.  For purposes of this clause (a) and clause (b) below, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (y) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a change in Requirement of Law regardless of the date enacted, adopted or issued.
(b)If any Lender shall have reasonably determined that the adoption of or any change in any Requirement of Law regarding capital adequacy or liquidity or in the interpretation or application thereof or compliance by such Lender or any corporation controlling such Lender with any request or directive regarding capital adequacy or liquidity (whether or not 

Exhibit 10.1

having the force of law) from any Governmental Authority made subsequent to the date hereof shall have the effect of reducing the rate of return on such Lender’s or such corporation’s capital as a consequence of its obligations hereunder or under or in respect of any Letter of Credit to a level below that which such Lender or such corporation could have achieved but for such adoption, change or compliance (taking into consideration such Lender’s or such corporation’s policies with respect to capital adequacy or liquidity) by an amount deemed by such Lender to be material, then from time to time, after submission by such Lender to the Borrower (with a copy to the Administrative Agent) of a written request therefor, the Borrower shall pay to such Lender such additional amount or amounts as will compensate such Lender or such corporation for such reduction; provided that the Borrower shall not be required to compensate a Lender pursuant to this paragraph for any amounts incurred more than six months prior to the date that such Lender notifies the Borrower of such Lender’s intention to claim compensation therefor; and provided, further, that, if the circumstances giving rise to such claim have a retroactive effect, then such six-month period shall be extended to include the period of such retroactive effect.
(c)A certificate as to any additional amounts payable pursuant to this Section (and setting forth calculations in reasonable detail demonstrating the basis therefor) submitted by any Lender to the Borrower (with a copy to the Administrative Agent) shall be conclusive in the absence of manifest error.  The obligations of the Borrower pursuant to this Section shall survive the termination of this Agreement and the payment of the Loans and all other amounts payable hereunder.
2.16.Taxes.  (a)  All payments made by or on account of any obligation of the Borrower under any Loan Document shall be made free and clear of, and without deduction or withholding for or on account of, any present or future income, stamp or other taxes, levies, imposts, duties, charges, fees, deductions or withholdings, now or hereafter imposed, levied, collected, withheld or assessed by any Governmental Authority (except as required by Law), excluding taxes imposed on or measured by net income, franchise taxes and branch profits taxes, in each case (i) imposed on the Administrative Agent or any Lender as a result of the Administrative Agent or such Lender being organized under the Laws of, or having its principal office or, in the case of any Lender, applicable lending office located in, the jurisdiction imposing the tax or (ii) a present or former connection between the Administrative Agent or such Lender and the jurisdiction of the Governmental Authority imposing such tax or any political subdivision or taxing authority thereof or therein (other than any such connection arising solely from the Administrative Agent’s or such Lender’s having executed, delivered or performed its obligations or received a payment under, or enforced, this Agreement or any other Loan Document).  If any such non-excluded taxes, levies, imposts, duties, charges, fees, deductions or withholdings (“Non-Excluded Taxes”) or any Other Taxes are required to be withheld from any amounts payable to the Administrative Agent or any Lender hereunder, the amounts so payable to the Administrative Agent or such Lender shall be increased to the extent necessary to yield to the Administrative Agent or such Lender (after payment of all Non-Excluded Taxes and Other Taxes, including all such amounts applicable to additional sums payable under this Section 2.16) interest and all other amounts payable at the rates or in the amounts specified in the applicable Loan Documents; provided, however, that the Borrower shall not be required to increase any such amounts payable to any Lender with respect to any Non-Excluded Taxes (i) that are attributable to such Lender’s or the Administrative Agent’s failure to comply with the requirements of paragraph (d) or (e) of this Section, as applicable, (ii) that are United States withholding taxes imposed on amounts payable 

Exhibit 10.1

to or for the account of such Lender at the time such Lender becomes a party to this Agreement, except to the extent that such Lender’s assignor (if any) was entitled, at the time of assignment, to receive additional amounts from the Borrower with respect to such Non-Excluded Taxes pursuant to this paragraph (a) or (iii) any U.S. federal withholding taxes imposed under FATCA.
(b)In addition, the Borrower shall pay any Other Taxes to the relevant Governmental Authority in accordance with applicable law.
(c)Whenever any Non-Excluded Taxes or Other Taxes are payable by the Borrower, as promptly as practicable thereafter the Borrower shall send to the Administrative Agent for the account of the Administrative Agent or relevant Lender, as the case may be, a certified copy of an original official receipt received by the Borrower showing payment thereof.  If the Borrower fails to pay any Non-Excluded Taxes or Other Taxes when due to the appropriate taxing authority or fails to remit to the Administrative Agent the required receipts or other required documentary evidence, the Borrower shall indemnify the Administrative Agent and the Lenders for any incremental taxes, interest or penalties that may become payable by the Administrative Agent or any Lender as a result of any such failure.  The agreements in this Section shall survive the termination of this Agreement and the payment of the Loans and all other amounts payable hereunder.
(d)Each Lender (or Transferee) that is not a “U.S. Person” as defined in Section 7701(a)(30) of the Code (a “Non‐U.S. Lender”) shall deliver to the Borrower and the Administrative Agent (or, in the case of a Participant, to the Lender from which the related participation shall have been purchased) two duly completed copies of either U.S. Internal Revenue Service Form W-8BEN, Form W-8BEN-E or Form W-8ECI, or, in the case of a Non‐U.S. Lender claiming exemption from U.S. federal withholding tax under Section 871(h) or 881(c) of the Code with respect to payments of “portfolio interest” a duly completed statement substantially in the form of Exhibit E and a Form W-8BEN or Form W-8BEN-E, or any subsequent versions thereof or successors thereto properly completed and duly executed by such Non‐U.S. Lender claiming complete exemption from, or a reduced rate of, U.S. federal withholding tax on all payments by the Borrower under this Agreement and the other Loan Documents.  Such forms shall be delivered by each Non‐U.S. Lender on or before the date it becomes a party to this Agreement (or, in the case of any Participant, on or before the date such Participant purchases the related participation).  Any Non-U.S. Lender shall, to the extent it is legally entitled to do so, deliver to the Borrower and the Administrative Agent (in such number of copies as shall be requested by such recipient) on or prior to the date on which such Non-U.S. Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), executed originals of any other form prescribed by applicable Law as a basis for claiming exemption from or a reduction in U.S. federal withholding tax, duly completed, together with such supplementary documentation as may be prescribed by applicable Law to permit the Borrower or the Administrative Agent to determine the withholding or deduction required to be made.  In addition, each Non‐U.S. Lender shall deliver such forms promptly upon the obsolescence or invalidity of any form previously delivered by such Non‐U.S. Lender.  Each Non-U.S. Lender shall promptly notify the Borrower at any time it determines that it is no longer in a position to provide any previously delivered certificate to the Borrower (or any other form of certification adopted by the U.S. taxing authorities for such purpose).  Notwithstanding any other provision of this paragraph, a Non‐U.S. Lender shall not be required to deliver any form pursuant to this paragraph that such Non‐U.S. 

Exhibit 10.1

Lender is not legally able to deliver.  Any Lender that is a “U.S. Person” as defined in Section 7701(a)(30) of the Code shall deliver to the Borrower and the Administrative Agent on or prior to the date on which such Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), executed originals of IRS Form W-9 certifying that such Lender is exempt from U.S. federal backup withholding tax.  In addition, any Lender, if reasonably requested by Borrower, shall deliver such other documentation as will enable the Borrower to determine whether or not such Lender is subject to backup withholding or information reporting.  Notwithstanding anything to the contrary in this Section 2.16(d), the completion, execution and submission of such documentation (other than the Form W-8BEN, the Form W-8BEN-E, the Form W-8ECI, the statement provided in Exhibit E and the Form W-9 described in this Section 2.16(d) and the documentation described below in Section 2.16(g)) shall not be required if in the Lender’s reasonable judgment such completion, execution or submission would subject such Lender to any material unreimbursed cost or expense or would materially prejudice the legal or commercial position of such Lender.
(e)A Lender that is entitled to an exemption from or reduction of non-U.S. withholding tax under the law of the jurisdiction in which the Borrower is located, or any treaty to which such jurisdiction is a party, with respect to payments under this Agreement shall deliver to the Borrower (with a copy to the Administrative Agent), at the time or times prescribed by applicable law or reasonably requested by the Borrower, such properly completed and executed documentation prescribed by applicable law as will permit such payments to be made without withholding or at a reduced rate; provided that such Lender is legally entitled to complete, execute and deliver such documentation and in such Lender’s reasonable judgment such completion, execution or submission would not materially prejudice the legal position of such Lender.
(f)The Borrower shall, subject to the limitations provided in subclauses (i) through (iii) in the last sentence of Section 2.16(a), indemnify the Administrative Agent and each Lender, within 10 days after demand therefor, for the full amount of any Non-Excluded Taxes and Other Taxes (including any Non-Excluded Taxes and Other Taxes imposed or asserted on or attributable to amounts payable under this Section) payable or paid by the Administrative Agent or such Lender or required to be withheld or deducted from a payment to the Administrative Agent or such Lender and any reasonable expenses arising therefrom or with respect thereto, whether or not such taxes were correctly or legally imposed or asserted by the relevant Governmental Authority.  A certificate as to the amount of such payment or liability delivered to the Borrower by the Administrative Agent or the applicable Lender (with a copy to the Administrative Agent), or by the Administrative Agent on its own behalf or on behalf of such Lender, shall be conclusive absent manifest error.
(g)If a payment made to a Lender under any Loan Document would be subject to U.S. federal withholding Tax imposed by FATCA if such Lender were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender shall deliver to the Borrower and the Administrative Agent at the time or times prescribed by Law and at such time or times reasonably requested by the Borrower or the Administrative Agent such documentation 

Exhibit 10.1

prescribed by applicable Law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by the Borrower or the Administrative Agent as may be necessary for the Borrower and the Administrative Agent to comply with their obligations under FATCA and to determine that such Lender has complied with such Lender’s obligations under FATCA or to determine the amount to deduct and withhold from such payment. Solely for purposes of this Section 2.16(g), “FATCA” shall include any amendments made to FATCA after the date of this Agreement.  For purposes of determining any withholding Tax imposed by FATCA, from and after the Closing Date, the Borrower and the Administrative Agent shall treat (and the Lenders hereby authorize the Administrative Agent to treat) this Agreement as not qualifying as a “grandfathered obligation” within the meaning of Treasury Regulation Section 1.1471-2(b)(2)(i).
2.17.Indemnity.  The Borrower agrees to indemnify each Lender for, and to hold each Lender harmless from, any loss or expense that such Lender may sustain or incur as a consequence of (a) default by the Borrower in making a borrowing of, conversion into or continuation of Eurodollar Loans after the Borrower has given a notice requesting the same in accordance with the provisions of this Agreement, (b) default by the Borrower in making any prepayment after the Borrower has given a notice thereof in accordance with the provisions of this Agreement or (c) the continuation, conversion, payment or prepayment of Eurodollar Loans on a day that is not the last day of an Interest Period with respect thereto (whether voluntary, mandatory, automatic, by reason of acceleration, or otherwise) or (d) the assignment of any Eurodollar Loan other than on the last day of the Interest Period or maturity date applicable thereto as a result of a request by the Borrower pursuant to Section 2.20.  Such indemnification may include an amount equal to the excess, if any, of (i) the amount of interest that would have accrued on the amount so prepaid, or not so borrowed, converted or continued, for the period from the date of such prepayment or of such failure to borrow, convert or continue to the last day of such Interest Period (or, in the case of a failure to borrow, convert or continue, the Interest Period that would have commenced on the date of such failure) in each case at the applicable rate of interest for such Loans provided for herein (excluding, however, the Applicable Margin included therein, if any) over (ii) the amount of interest (as reasonably determined by such Lender) that would have accrued to such Lender on such amount by placing such amount on deposit for a comparable period with leading banks in the interbank Eurodollar market.  A certificate as to any amounts payable pursuant to this Section (and setting forth calculations in reasonable detail demonstrating the basis therefor) submitted to the Borrower by any Lender shall be conclusive in the absence of manifest error.  This covenant shall survive the termination of this Agreement and the payment of the Loans and all other amounts payable hereunder.
2.18.Illegality.  Notwithstanding any other provision herein, if after the Closing Date the adoption of or any change in any Requirement of Law or in the interpretation or application thereof shall make it unlawful for any Lender to make or maintain Eurodollar Loans as contemplated by this Agreement, (a) the commitment of such Lender hereunder to make Eurodollar Loans, continue Eurodollar Loans as such and convert Base Rate Loans to Eurodollar Loans shall forthwith be suspended until such condition shall cease to exist and (b) such Lender’s Loans then outstanding as Eurodollar Loans, if any, shall be converted automatically to Base Rate Loans on the respective last days of the then current Interest Periods with 

Exhibit 10.1

respect to such Loans or within such earlier period as required by law.  If any such conversion of a Eurodollar Loan occurs on a day which is not the last day of the then current Interest Period with respect thereto, the Borrower shall pay to such Lender such amounts, if any, as may be required pursuant to Section 2.17.
2.19.Change of Lending Office.  Each Lender agrees that, upon the occurrence of any event giving rise to the operation of Section 2.15, 2.16(a) or 2.18 with respect to such Lender, it will, if requested by the Borrower, use reasonable efforts (subject to overall policy considerations of such Lender) to designate another lending office for any Loans affected by such event with the object of avoiding the consequences of such event; provided, that such designation is made on terms that, in the sole judgment of such Lender, cause such Lender and its lending office(s) to suffer no economic, legal or regulatory disadvantage; and provided, further, that nothing in this Section shall affect or postpone any of the obligations of the Borrower or the rights of any Lender pursuant to Section 2.15, 2.16(a) or 2.18.
2.20.Replacement of Lenders under Certain Circumstances.  The Borrower shall be permitted to replace with a replacement financial institution any Lender that (a) requests compensation for amounts owing pursuant to Section 2.15 or if the Borrower is required to pay any Non-Excluded Taxes or additional amounts to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.15 or 2.16 or gives a notice of illegality pursuant to Section 2.18, (b) defaults in its obligation to make Loans hereunder (or is otherwise a Defaulting Lender) or (c) refuses to consent to any amendment, waiver or other modification of any Loan Document requested by the Borrower that requires the consent of all Lenders and such amendment, waiver or other modification is consented to by the Required Lenders; provided that (i) such replacement does not conflict with any Requirement of Law, (ii) no Event of Default shall have occurred and be continuing at the time of such replacement, (iii) prior to any such replacement, such Lender shall have taken no action under Section 2.19 so as to eliminate the continued need for payment of amounts owing pursuant to Section 2.15 or 2.16 or to eliminate the illegality referred to in such notice of illegality given pursuant to Section 2.18, (iv) the replacement financial institution shall purchase, at par, all Loans and other amounts owing to such replaced Lender on or prior to the date of replacement, (v) the Borrower shall be liable to such replaced Lender under Section 2.17 (as though Section 2.17 were applicable) if any Eurodollar Loan owing to such replaced Lender shall be purchased other than on the last day of the Interest Period relating thereto, (vi) the replacement financial institution, if not already a Lender, shall be reasonably satisfactory to the Administrative Agent, (vii) the replaced Lender shall be obligated to make such replacement in accordance with the provisions of Section 10.6 (provided that the Borrower shall be obligated to pay the registration and processing fee referred to therein), (viii) the Borrower shall pay all additional amounts (if any) required pursuant to Section 2.15 or 2.16, as the case may be, in respect of any period prior to the date on which such replacement shall be consummated, and (ix) any such replacement shall not be deemed to be a waiver of any rights that the Borrower, the Administrative Agent or any other Lender shall have against the replaced Lender.

Exhibit 10.1

2.21.Defaulting Lenders.
(a)Adjustments.  Notwithstanding anything to the contrary contained in this Agreement, if any Lender becomes a Defaulting Lender, then, until such time as that Lender is no longer a Defaulting Lender, to the extent permitted by applicable Law:
(i)Waivers and Amendments.  Such Defaulting Lender’s right to approve or disapprove any amendment, waiver or consent with respect to this Agreement shall be restricted as set forth in Section 10.01.
(ii)Reallocation of Payments.  Any payment of principal, interest, fees or other amounts received by the Administrative Agent for the account of such Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to Article VIII or otherwise, and including any amounts made available to the Administrative Agent by such Defaulting Lender pursuant to Section 10.07), shall be applied at such time or times as may be determined by the Administrative Agent as follows:  first, to the payment of any amounts owing by that Defaulting Lender to the Administrative Agent hereunder; second, to the payment on a pro rata basis of any amounts owing by such Defaulting Lender to the Issuing Lender hereunder; third, if so determined by the Administrative Agent or requested by the Issuing Lender, to be held as Cash Collateral for future funding obligations of such Defaulting Lender of any participation in any Letter of Credit; fourth, as the Borrower may request (so long as no Default or Event of Default exists), to the funding of any Loan in respect of which such Defaulting Lender has failed to fund its portion thereof as required by this Agreement, as determined by the Administrative Agent; fifth, if so determined by the Administrative Agent and the Borrower, to be held in a non-interest bearing deposit account and released in order to satisfy obligations of such Defaulting Lender to fund Loans under this Agreement; sixth, to the payment of any amounts owing to the Lenders or the Issuing Lender as a result of any judgment of a court of competent jurisdiction obtained by any Lender or the Issuing Lender against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement; seventh, so long as no Default or Event of Default exists, to the payment of any amounts owing to the Borrower as a result of any judgment of a court of competent jurisdiction obtained by the Borrower against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement; and eighth, to such Defaulting Lender or as otherwise directed by a court of competent jurisdiction; provided that if (x) such payment is a payment of the principal amount of any Loans or L/C Obligations in respect of which such Defaulting Lender has not fully funded its appropriate share and (y) such Loans or L/C Obligations were made at a time when the conditions set forth in Section 5.2 were satisfied or waived, such payment shall be applied solely to pay the Loans of, and L/C Obligations owed to, all non-Defaulting Lenders on a pro rata basis prior to being applied to the payment of any Loans of, or L/C Obligations owed to, such Defaulting Lender.  Any payments, prepayments or other amounts paid or payable to a Defaulting Lender that are applied (or held) to pay amounts owed by a Defaulting Lender or to post Cash Collateral pursuant to this Section 2.21(a)(ii) 

Exhibit 10.1

shall be deemed paid to and redirected by such Defaulting Lender, and each Lender irrevocably consents hereto.
(iii)Certain Fees.  Such Defaulting Lender (x) shall not be entitled to receive any commitment fee pursuant to Section 2.6 for any period during which that Lender is a Defaulting Lender (and the Borrower shall not be required to pay any such fee that otherwise would have been required to have been paid to that Defaulting Lender) and (y) shall be limited in its right to receive Letter of Credit Fees as provided in Section 3.3.  If the Borrower Cash Collateralizes any portion of a Defaulting Lender’s L/C Obligations pursuant to Section 2.22(a), the Borrower shall not be required to pay any fees to such Defaulting Lender pursuant to Section 3.3 with respect to such Defaulting Lender’s L/C Obligations during the period such Defaulting Lender’s L/C Obligations are Cash Collateralized.
(iv)Reallocation of Applicable Percentages to Reduce Fronting Exposure.  During any period in which there is a Defaulting Lender, for purposes of computing the amount of the obligation of each non-Defaulting Lender to acquire, refinance or fund participations in Letters of Credit pursuant to Section 2.5, the “Applicable Percentage” of each non-Defaulting Lender shall be computed without giving effect to the Revolving Credit Commitment of that Defaulting Lender; provided, that, (i) each such reallocation shall be given effect only if, at the date the applicable Lender becomes a Defaulting Lender, no Default or Event of Default exists; and (ii) the aggregate obligation of each non-Defaulting Lender to acquire, refinance or fund participations in Letters of Credit shall not exceed the positive difference, if any, of (1) the Revolving Credit Commitment of that non-Defaulting Lender minus (2) the aggregate outstanding amount of the Revolving Credit Loans of that Lender.
(b)Defaulting Lender Cure.  If the Borrower, the Administrative Agent, and the Issuing Lender  agree in writing in their sole discretion that a Defaulting Lender should no longer be deemed to be a Defaulting Lender, the Administrative Agent will so notify the parties hereto, whereupon as of the effective date specified in such notice and subject to any conditions set forth therein (which may include arrangements with respect to any Cash Collateral), that Lender will, to the extent applicable, purchase that portion of outstanding Loans of the other Lenders or take such other actions as the Administrative Agent may determine to be necessary to cause the Revolving Credit Loans and funded and unfunded participations in Letters of Credit to be held on a pro rata basis by the Lenders in accordance with their Applicable Percentages (without giving effect to Section 2.21(a)(iv)), whereupon that Lender will cease to be a Defaulting Lender; provided that no adjustments will be made retroactively with respect to fees accrued or payments made by or on behalf of the Borrower while that Lender was a Defaulting Lender; and provided, further, that except to the extent otherwise expressly agreed by the affected parties, no change hereunder from Defaulting Lender to Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender’s having been a Defaulting Lender.

Exhibit 10.1

2.22.Cash Collateral.
(a)Certain Credit Support Events.  Upon the request of the Administrative Agent or the Issuing Lender if, as of the Letter of Credit Expiration Date, any L/C Obligation for any reason remains outstanding, the Borrower shall immediately Cash Collateralize the then outstanding amount of all L/C Obligations.  At any time that there shall exist a Defaulting Lender, immediately upon the request of the Administrative Agent or the Issuing Lender, the Borrower shall deliver to the Administrative Agent Cash Collateral in an amount sufficient to cover all Fronting Exposure (after giving effect to Section 2.21(a)(iv) and any Cash Collateral provided by the Defaulting Lender).
(b)Grant of Security Interest.  All Cash Collateral (other than credit support not constituting funds subject to deposit) shall be maintained in blocked, non-interest bearing deposit accounts at Bank of America.  The Borrower, and to the extent provided by any Lender, such Lender, hereby grants to (and subjects to the control of) the Administrative Agent, for the benefit of the Administrative Agent, the Issuing Lender and the Lenders, and agrees to maintain, a first priority security interest in all such cash, deposit accounts and all balances therein, and all other property so provided as collateral pursuant hereto, and in all proceeds of the foregoing, all as security for the obligations to which such Cash Collateral may be applied pursuant to Section 2.22(c).  If at any time the Administrative Agent determines that Cash Collateral is subject to any right or claim of any Person other than the Administrative Agent as herein provided, or that the total amount of such Cash Collateral is less than the applicable Fronting Exposure and other obligations secured thereby, the Borrower or the relevant Defaulting Lender will, promptly upon demand by the Administrative Agent, pay or provide to the Administrative Agent additional Cash Collateral in an amount sufficient to eliminate such deficiency.
(c)Application.  Notwithstanding anything to the contrary contained in this Agreement, Cash Collateral provided in respect of Letters of Credit shall be held and applied to the satisfaction of the specific L/C Obligations, obligations to fund participations therein (including, as to Cash Collateral provided by a Defaulting Lender, any interest accrued on such obligation) and other obligations for which the Cash Collateral was so provided, prior to any other application of such property as may be provided for herein.
(d)Release.  Cash Collateral (or the appropriate portion thereof) provided to reduce Fronting Exposure or other obligations shall be released promptly following (i) the elimination of the applicable Fronting Exposure or other obligations giving rise thereto (including by the termination of Defaulting Lender status of the applicable Lender (or, as appropriate, its assignee following compliance with Section 10.06(d)) or (ii) the Administrative Agent’s good faith determination that there exists excess Cash Collateral; provided, however, (x) that Cash Collateral furnished by or on behalf of the Borrower shall not be released during the continuance of a Default or Event of Default (and following application as provided in this Section 2.22 may be otherwise applied in accordance with Article 8), and (y) the Person providing Cash Collateral and the Issuing Lender may agree that Cash Collateral shall not be released but instead held to support future anticipated Fronting Exposure or other obligations.

Exhibit 10.1

SECTION 3.  LETTERS OF CREDIT
3.1.L/C Commitment.  (a)  Subject to the terms and conditions hereof, each Issuing Lender, in reliance on the agreements of the other Revolving Credit Lenders set forth in Section 3.4, agrees to issue sight letters of credit on a standby basis (the “Letters of Credit”) in support of the L/C Supportable Obligations for the account of the Borrower on any Business Day during the Revolving Credit Commitment Period in such form as may be approved from time to time by such Issuing Lender; provided, that no Issuing Lender shall have any obligation to issue any Letter of Credit if, after giving effect to such issuance, (i) the L/C Obligations would exceed the L/C Commitment or (ii) the aggregate amount of the Available Revolving Credit Commitments would be less than zero.  Notwithstanding the foregoing, no Issuing Lender shall have any obligation to issue any Letter of Credit on any date that is later than the Letter of Credit Expiration Date.  Each Letter of Credit shall (i) be denominated in Dollars and (ii) expire no later than the earlier of (x) the first anniversary of its date of issuance and (y) the date which is five Business Days prior to the Revolving Credit Termination Date; provided that any Letter of Credit may provide for the extension thereof for additional one year periods (which shall in no event extend beyond the date referred to in clause (y) above) (each, an “Auto-Extension Letter of Credit”); provided that any such Auto-Extension Letter of Credit must permit the Issuing Lender to prevent any such extension (commencing with the date of issuance of such Letter of Credit) by giving prior notice to the beneficiary thereof not later than a day (the “Non-Extension Notice Date”) to be agreed upon at the time such Letter of Credit is issued.  Unless otherwise directed by the Issuing Lender, the Borrower shall not be required to make a specific request to the Issuing Lender for any such extension.  Once an Auto-Extension Letter of Credit has been issued, the Revolving Credit Lenders shall be deemed to have authorized (but may not require) the Issuing Lender to permit the extension of such Letter of Credit at any time to an expiry date not later than the Letter of Credit Expiration Date; provided, however, that the Issuing Lender shall not permit any such extension if the Issuing Lender has determined that it would not be permitted, or would have no obligation at such time to issue such Letter of Credit in its revised form (as extended) under the terms hereof (by reason of the provisos of this clause (a) or the provisions of clauses (b), (c) or (d) of this Section 3.1).  
(b)No Issuing Lender shall at any time be obligated to issue any Letter of Credit hereunder if (i) there shall have occurred and be continuing a Default or Event of Default shall exist or (ii) such issuance would conflict with, or cause such Issuing Lender or any L/C Participant to exceed any limits imposed by, any applicable Requirement of Law.
(c)So long as any Lender is a Defaulting Lender, no Issuing Lender shall be required to issue, amend or increase any Letters of Credit, unless it is satisfied that the related exposure and such Defaulting Lender’s then outstanding L/C Obligations will be 100% covered by the Revolving Credit Commitments of the non-Defaulting Lenders (by re-allocation among non-Defaulting Lenders (without the participation of such Defaulting Lender therein) as provided in Section 2.21(a)(iv)) and/or by Cash Collateral provided by such Defaulting Lender (and/or by the Borrower in accordance with Section 2.22(a)).
(d)No Issuing Lender shall be under any obligation to issue any Letter of Credit if:

Exhibit 10.1

(i)any order, judgment or decree of any Governmental Authority or arbitrator shall by its terms purport to enjoin or restrain the Issuing Lender from issuing the Letter of Credit, or any Law applicable to the Issuing Lender or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over the Issuing Lender shall prohibit, or request that the Issuing Lender refrain from, the issuance of letters of credit generally or the Letter of Credit in particular or shall impose upon the Issuing Lender with respect to the Letter of Credit any restriction, reserve or capital requirement (for which the Issuing Lender is not otherwise compensated hereunder) not in effect on the Closing Date, or shall impose upon the Issuing Lender any unreimbursed loss, cost or expense which was not applicable on the Closing Date and which the Issuing Lender in good faith deems material to it; or
(ii)the issuance of the Letter of Credit would violate one or more policies of the Issuing Lender applicable to letters of credit generally; or
(iii)the Letter of Credit contains any provisions for automatic reinstatement of the stated amount after any drawing thereunder. 
(e)No Issuing Lender shall be under any obligation to amend any Letter of Credit if:
(i)the Issuing Lender would have no obligation at such time to issue such Letter of Credit in its amended form under the terms hereof; or 
(ii)the beneficiary of such Letter of Credit does not accept the proposed amendment to the Letter of Credit.
3.2.Procedure for Issuance of Letter of Credit.  The Borrower may from time to time request that an Issuing Lender issue a Letter of Credit by delivering to such Issuing Lender (with a copy to the Administrative Agent) a Letter of Credit Request in the form of Exhibit G, attached hereto, accompanied by such other certificates, documents and other papers and other information as such Issuing Lender may request.  If the Issuing Lender shall so reasonably request, each Letter of Credit Request shall be accompanied by an Application; provided that if the Administrative Agent reasonably determines that such Application contains all information required with respect to a Letter of Credit, no Letter of Credit Request shall be necessary.  Upon receipt of any Letter of Credit Request, an Issuing Lender will process such request in accordance with its customary procedures.  The Issuing Lender, upon determining that it has received an acceptable Letter of Credit Request, that the terms and conditions of the requested Letter of Credit are acceptable to it and that the Administrative Agent has confirmed that such issuance would not cause (i) the L/C Obligations to exceed the L/C Commitment or (ii) the aggregate amount of the Available Revolving Credit Commitments to be less than zero, shall issue the Letter of Credit (but in no event shall any Issuing Lender be required to issue any Letter of Credit earlier than three Business Days after its receipt of a Letter of Credit Request).  The original of any Letter of Credit shall be delivered to the beneficiary thereof or as otherwise agreed to by the Borrower and the Issuing Lender.  Promptly after the issuance or amendment of a Letter of Credit, the Issuing Lender shall promptly notify the Administrative Agent and the 

Exhibit 10.1

Borrower, in writing, of such issuance or amendment and such notice shall be accompanied by a copy of such issuance or amendment.  Upon receipt of such notice, the Administrative Agent shall notify each L/C Participant of such issuance or amendment, and if so requested by an L/C Participant, the Administrative Agent shall provide such L/C Participant with copies of such issuance or amendment.
3.3.Fees and Other Charges.  (a)  The Borrower will pay a fee to the Administrative Agent, for the ratable benefit of the Revolving Credit Lenders, on the daily aggregate drawable amount of all outstanding Letters of Credit at a per annum rate equal to the Applicable Margin then in effect with respect to Eurodollar Loans under the Revolving Credit Facility ( the “Letter of Credit Fee”), shared ratably among the Revolving Credit Lenders in accordance with their respective Revolving Credit Percentages and payable quarterly in arrears on each L/C Fee Payment Date after the issuance date; provided, however, any fees otherwise payable for the account of a Defaulting Lender with respect to any Letter of Credit as to which such Defaulting Lender has not provided Cash Collateral satisfactory to the Issuing Lender pursuant to Section 3.1(c) shall be payable, to the maximum extent permitted by applicable Law, to the other Lenders in accordance with the upward adjustments in their respective Applicable Percentages allocable to such Letter of Credit pursuant to Section 2.21(a)(iv), with the balance of such fee, if any, payable to the Borrower to the extent that the Borrower has provided Cash Collateral on account of such Defaulting Lender pursuant to Section 2.22(a) and otherwise to the Issuing Lender for its own account; provided further that any fee payable to a Defaulting Lender shall be subject to Section 2.21(a)(iii).  In addition, except as otherwise agreed to between the relevant Issuing Lender and the Borrower, the Borrower shall pay to the relevant Issuing Lender for its own account a fronting fee on the aggregate drawable amount of all outstanding Letters of Credit issued by it of 0.125% per annum, payable quarterly in arrears on each L/C Fee Payment Date after the issuance date.  Notwithstanding anything to the contrary contained herein, while any of the events described in Section 8(f) shall have occurred and be continuing with respect to the Borrower, the Letter of Credit Fee shall accrue at a rate equal to the Applicable Margin plus 2% per annum.
(b)In addition to the foregoing fees, the Borrower shall pay or reimburse each Issuing Lender quarterly in arrears on each L/C Fee Payment Date for such reasonable, normal and customary costs and expenses as are incurred or charged by such Issuing Lender in issuing, effecting payment under, amending or otherwise administering any Letter of Credit.
3.4.L/C Participations.  (a)  Each Issuing Lender irrevocably agrees to grant and hereby grants to each L/C Participant, and, to induce each Issuing Lender to issue Letters of Credit hereunder, each L/C Participant irrevocably agrees to accept and purchase and hereby accepts and purchases from each Issuing Lender, on the terms and conditions hereinafter stated, for such L/C Participant’s own account and risk, an undivided interest equal to such L/C Participant’s Revolving Credit Percentage of each Issuing Lender’s obligations and rights under each Letter of Credit issued by such Issuing Lender hereunder and the amount of each draft paid by such Issuing Lender thereunder.  Each L/C Participant unconditionally and irrevocably agrees with each Issuing Lender that, if a draft is paid under any Letter of Credit issued by such Issuing Lender for which such Issuing Lender is not reimbursed in full by the Borrower in accordance with the terms of this Agreement, such L/C Participant shall pay to the Administrative Agent for the account of such Issuing Lender upon demand at the Funding Office (and thereafter the 

Exhibit 10.1

Administrative Agent shall promptly pay to such Issuing Lender) an amount equal to such L/C Participant’s Revolving Credit Percentage of the amount of such draft, or any part thereof, that is not so reimbursed.  Each L/C Participant’s obligation to pay such amount shall be absolute and unconditional and shall not be affected by any circumstance, including (i) any setoff, counterclaim, recoupment, defense or other right that such L/C Participant may have against the Issuing Lender, the Borrower or any other Person for any reason whatsoever, (ii) the occurrence or continuance of a Default or an Event of Default or the failure to satisfy any of the other conditions specified in Section 5, (iii) any adverse change in the condition (financial or otherwise) of the Borrower, (iv) any breach of this Agreement or any other Loan Document by the Borrower or any other L/C Participant or (v) any other circumstance, happening or event whatsoever, whether or not similar to any of the foregoing.  The failure of any L/C Participant to make any payment pursuant to this Section 3.4 shall not relieve any other L/C Participant of its obligation hereunder.
(b)If any amount (a “Participation Amount”) required to be paid by any L/C Participant to an Issuing Lender through the Administrative Agent pursuant to Section 3.4(a) in respect of any unreimbursed portion of any payment made by such Issuing Lender under any Letter of Credit is paid to such Issuing Lender within three Business Days after the date such payment is due, such Issuing Lender shall so notify the Administrative Agent, which shall promptly notify the L/C Participants, and each L/C Participant shall pay to the Administrative Agent, for the account of such Issuing Lender, on demand (and thereafter the Administrative Agent shall promptly pay to such Issuing Lender) an amount equal to the product of (i) such Participation Amount, times (ii) the daily average Federal Funds Effective Rate during the period from and including the date such payment is required to the date on which such payment is immediately available to such Issuing Lender, times (iii) a fraction the numerator of which is the number of days that elapse during such period and the denominator of which is 360.  If any Participation Amount required to be paid by any L/C Participant pursuant to Section 3.4(a) is not made available to the Administrative Agent for the account of the relevant Issuing Lender by such L/C Participant within three Business Days after the date such payment is due, the Administrative Agent on behalf of such Issuing Lender shall be entitled to recover from such L/C Participant, on demand, such Participation Amount with interest thereon calculated from such due date at the rate per annum applicable to Base Rate Loans under the Revolving Credit Facility.  A certificate of the Administrative Agent submitted on behalf of an Issuing Lender to any L/C Participant with respect to any amounts owing under this Section shall be conclusive in the absence of manifest error.
(c)Whenever, at any time after an Issuing Lender has made payment under any Letter of Credit and has received from the Administrative Agent any  L/C Participant’s pro rata share of such payment in accordance with Section 3.4(a), such Issuing Lender receives any payment related to such Letter of Credit (whether directly from the Borrower or otherwise, including proceeds of collateral applied thereto by such Issuing Lender), or any payment of interest on account thereof, such Issuing Lender will distribute to the Administrative Agent for the account of such L/C Participant (and thereafter the Administrative Agent will promptly distribute to such L/C Participant) its pro rata share of such payment in accordance with Section 3.4(a), if the Administrative Agent received for the account of the Issuing Lender (whether directly from the Borrower or otherwise, including proceeds of any collateral applied thereto by the Administrative Agent) or any payment of interest on account thereof, the Administrative 

Exhibit 10.1

Agent will distribute to such L/C Participant its pro rata share thereof; provided, however, that in the event that any such payment received by such Issuing Lender shall be required to be returned by such Issuing Lender, such L/C Participant shall return to the Administrative Agent for the account of such Issuing Lender (and thereafter the Administrative Agent shall promptly return to such Issuing Lender) the portion thereof previously distributed by such Issuing Lender.
3.5.Reimbursement Obligation of the Borrower.  The Borrower agrees to reimburse each Issuing Lender, within one Business Day (or two Business Days if the Borrower and the Administrative Agent are notified on after 11:00 a.m. New York City time on such date) after the Business Day on which such Issuing Lender notifies the Borrower and the Administrative Agent of the date and amount of a draft presented under any Letter of Credit and paid by such Issuing Lender, for the amount of (a) such draft so paid and (b) any taxes, fees, charges or other costs or expenses incurred by such Issuing Lender in connection with such payment (the amounts described in the foregoing clauses (a) and (b) in respect of any drawing, collectively, the “Payment Amount”).  Each such payment shall be made to such Issuing Lender through the Administrative Agent in lawful money at its address for notices specified herein in lawful money of the United States of America and in immediately available funds.  Interest shall be payable on each Payment Amount from the date of the applicable drawing until payment in full at the rate set forth in (i) until the second Business Day following the date of the applicable drawing, Section 2.11(b) and (ii) thereafter, Section 2.11(c).  Each notice from an Issuing Lender of a drawing under any Letter of Credit shall (unless an event of the type described in clause (i) or (ii) of Section 8(f) shall have occurred and be continuing with respect to the Borrower, in which case the procedures specified in Section 3.4 for funding by L/C Participants shall apply) constitute a request by the Borrower to the Administrative Agent for a borrowing pursuant to Section 2.2 of Base Rate Loans in the amount of such drawing.  The Borrowing Date with respect to such borrowing shall be the first date on which a borrowing of Revolving Credit Loans could be made, pursuant to Section 2.2, if the Administrative Agent had received a notice of such borrowing at the time the Administrative Agent receives notice from the relevant Issuing Lender of such drawing under such Letter of Credit.
3.6.Obligations Absolute.  The Borrower’s obligations under this Section 3 shall be absolute and unconditional under any and all circumstances and irrespective of (i) any setoff, counterclaim or defense to payment that the Borrower may have or have had against any Issuing Lender, any beneficiary of a Letter of Credit or any other Person, (ii) any waiver by the Issuing Lender of any requirement that exists for the Issuing Lender’s protection or any waiver by the Issuing Lender which does not in fact materially prejudice the Borrower, (iii) honor of a demand for payment presented electronically even if such Letter of Credit requires that demand be in the form of a draft, any payment made by the Issuing Lender in respect of an otherwise complying item presented after the date specified as the expiration date of, or the date by which documents must be received under such Letter of Credit if presentation after such date is authorized by the UCC, the ISP or the UCP, as applicable or (iv) any payment by the Issuing Lender under such Letter of Credit against presentation of a draft or certificate that does not strictly comply with the terms of such Letter of Credit; or any payment made by the Issuing Lender under such Letter of Credit to any Person purporting to be a trustee in bankruptcy, debtor-in-possession, assignee for the benefit of creditors, liquidator, receiver or other representative of or successor to any beneficiary or any transferee of such Letter of Credit, including any arising in connection with any proceeding under any Debtor Relief Law.  The 

Exhibit 10.1

Borrower also agrees with each Issuing Lender that such Issuing Lender shall not be responsible for, and the Borrower’s Reimbursement Obligations under Section 3.5 shall not be affected by, among other things, the validity or genuineness of documents or of any endorsements thereon, even though such documents shall in fact prove to be invalid, fraudulent or forged, or any dispute between or among the Borrower and any beneficiary of any Letter of Credit or any other party to which such Letter of Credit may be transferred or any claims whatsoever of the Borrower against any beneficiary of such Letter of Credit or any such transferee.  No Issuing Lender shall be liable to the Borrower for any error, omission, interruption or delay in transmission, dispatch or delivery of any message or advice, however transmitted, in connection with any Letter of Credit, except for errors or omissions found by a final and nonappealable decision of a court of competent jurisdiction to have resulted from the gross negligence or willful misconduct of such Issuing Lender.  The Borrower, the Lenders and any other party hereto agree that any action taken or omitted by an Issuing Lender under or in connection with any Letter of Credit issued by it or the related drafts or documents, including the payment thereof, absent a finding of gross negligence or willful misconduct of the Issuing Lender as determined by a final and nonappealable decision of a court of competent jurisdiction, shall be binding on the Borrower, the Lenders and any other party hereto and shall not result in any liability of such Issuing Lender to the Borrower, the Lenders or any other party hereto.  Furthermore, no Issuing Lender shall be liable to the Borrower for the existence of any claim, counterclaim, setoff, defense or other right that the Borrower or any Subsidiary may have at any time against any beneficiary or any transferee of such Letter of Credit (or any Person for whom any such beneficiary or any such transferee may be acting), the Issuing Lender or any other Person, whether in connection with this Agreement or by such Letter of Credit, the transactions contemplated hereby or any agreement or instrument relating thereto, or any unrelated transaction or any other circumstance or happening whatsoever, whether or not similar to any of the foregoing, including any other circumstance that might otherwise constitute a defense available to, or a discharge of, the Borrower or any of its Subsidiaries.  The Borrower shall promptly examine a copy of each Letter of Credit and each amendment thereto that is delivered to it and, in the event of any claim of noncompliance with the Borrower’s instructions or other irregularity, the Borrower will immediately notify the Issuing Lender.  The Borrower shall be conclusively deemed to have waived any such claim against the Issuing Lender and its correspondents unless such notice is given as aforesaid.
3.7.Letter of Credit Payments.  If any draft shall be presented for payment under any Letter of Credit, the relevant Issuing Lender shall promptly notify the Borrower and the Administrative Agent of the date and amount thereof.  The responsibility of the relevant Issuing Lender to the Borrower in connection with any draft presented for payment under any Letter of Credit, in addition to any payment obligation expressly provided for in such Letter of Credit issued by such Issuing Lender, shall be limited to determining that the documents (including each draft) delivered under such Letter of Credit in connection with such presentment appear on their face to be in conformity with such Letter of Credit.
3.8.Applications.  To the extent that any provision of any Application related to any Letter of Credit is inconsistent with the provisions of this Section 3, the provisions of this Section 3 shall apply.

Exhibit 10.1

3.9.Existing Letters of Credit.  The Borrower, the Administrative Agent, the Revolving Credit Lenders and the Issuing Bank hereby acknowledge that on and as of the Closing Date the Existing Letters of Credit shall irrevocably be deemed to be Letters of Credit under this Agreement and all the provisions of this Agreement shall apply to the Existing Letters of Credit as being Letters of Credit issued under this Agreement by the relevant Issuing Bank, the whole without novation of all of the obligations of Borrower to each relevant Issuing Bank in respect of said Existing Letters of Credit.
3.10.Applicability of ISP and UCP; Limitation of Liability.  Unless otherwise expressly agreed by the Issuing Lender and the Borrower when a Letter of Credit is issued (including any such agreement applicable to an Existing Letter of Credit), (i) the rules of the ISP shall apply to each standby Letter of Credit and (ii) the rules of the UCP shall apply to each commercial Letter of Credit.  Notwithstanding the foregoing, the Issuing Lender shall not be responsible to the Borrower for, and the Issuing Lender’s rights and remedies against the Borrower shall not be impaired by, any action or inaction of the Issuing Lender required or permitted under any law, order or practice that is required or permitted to be applied to any Letter of Credit or this Agreement, including the Law or any order of a jurisdiction where the Issuing Lender or the beneficiary is located, the practice stated in the ISP or UCP, as applicable, or in the decisions, opinions, practice statements or official commentary of the ICC Banking Commission, the Bankers Association for Finance and Trade - International Financial Services Association (BAFT-IFSA), or the Institute of International Banking Law & Practice, whether or not any Letter of Credit chooses such law or practice.
SECTION 4.  REPRESENTATIONS AND WARRANTIES
To induce the Administrative Agent and the Lenders to enter into this Agreement and to make the Loans and issue or participate in the Letters of Credit, the Borrower hereby represents and warrants to the Administrative Agent and each Lender that:
4.1.Financial Condition
(a)[Reserved.]
(b)The audited consolidated balance sheets of the Borrower and its Subsidiaries as of December 31, 2015, and the related consolidated statements of income and of cash flows for the fiscal year ended on such date, reported on by and accompanied by a report from Deloitte & Touche LLP, a copy of which have heretofore been furnished to each Lender, present fairly the consolidated financial condition of the Borrower and its Subsidiaries as at such date, and the results of their operations and cash flows for the period then ended.  The unaudited consolidated balance sheet of the Borrower and its Subsidiaries as of March 31, 2016, June 30, 2016 and September 30, 2016 and the related unaudited consolidated statements of income and cash flows for the three-month periods ended on such dates, copies of which have heretofore been furnished to the Administrative Agent, present fairly the consolidated financial condition of the Borrower and its Subsidiaries as at such dates, and the results of their operations and cash flows for the three-month periods then ended (subject to normal year‐end audit adjustments and the absence of footnotes).  All such financial statements, including the related schedules and notes thereto, have been prepared in accordance with GAAP applied consistently throughout the 

Exhibit 10.1

periods involved (except as approved by the aforementioned firm of accountants and disclosed therein).  The Borrower and its Subsidiaries do not have any material Guarantee Obligations, contingent liabilities and liabilities for taxes, or any long‐term leases or unusual forward or long‐term commitments, including any interest rate or foreign currency swap or exchange transaction or other obligation in respect of derivatives, that are not reflected in the financial statements referred to in this paragraph or disclosed in SEC Reports filed prior to the date hereof.  During the period from September 30, 2016 to and including the date hereof there has been no Disposition by the Borrower of any material part of its business or Property except as has been expressly disclosed in SEC Reports filed prior to the date hereof.
4.2.No Change.  Since December 31, 2015 there has been no development or event that has had or could reasonably be expected to have a Material Adverse Effect except as has been expressly disclosed in SEC Reports filed prior to the date hereof.
4.3.Corporate Existence; Compliance with Law.  Each of the Borrower and its Subsidiaries (a) is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization, (b) has the corporate or limited liability power and authority, and the legal right, to own and operate its Property, to lease the Property it operates as lessee and to conduct the business in which it is currently engaged, (c) is duly qualified as a foreign corporation or other organization and in good standing under the laws of each jurisdiction where its ownership, lease or operation of Property or the conduct of its business requires such qualification except to the extent to so qualify and be in good standing could not in the aggregate reasonably be expected to have a Material Adverse Effect (and, in any event, the Borrower is duly qualified as a foreign corporation and in good standing under the laws of the States of Montana and South Dakota), and (d) is in compliance with all Requirements of Law except to the extent that the failure to comply therewith could not, in the aggregate, reasonably be expected to have a Material Adverse Effect.
4.4.Corporate Power; Authorization; Enforceable Obligations.  The Borrower has the corporate power and authority, and the legal right, to make, deliver and perform the Loan Documents to which it is a party and to borrow hereunder.  The Borrower has taken all necessary corporate action to authorize the execution, delivery and performance of the Loan Documents to which it is a party and to authorize the borrowings on the terms and conditions of this Agreement.  No consent or authorization of, filing with, notice to or other act by or in respect of, any Governmental Authority or any other Person is required in connection with the borrowings hereunder or the execution, delivery, performance, validity or enforceability of this Agreement or any of the other Loan Documents, except (i) consents, authorizations, filings and notices described in Schedule 4.4, which consents, authorizations, filings and notices have been obtained or made and are in full force and effect, and (ii) consents, authorizations, filings or notices which, if not obtained, could not reasonably be expected to have a Material Adverse Effect.  This Agreement has been, and each other Loan Document upon execution will be, duly executed and delivered on behalf of the Borrower.  This Agreement constitutes, and each other Loan Document upon execution will constitute, a legal, valid and binding obligation of the Borrower, enforceable against the Borrower 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).

Exhibit 10.1

4.5.No Legal Bar.  The execution, delivery and performance of this Agreement and the other Loan Documents, the issuance of Letters of Credit, the borrowings hereunder and the use of proceeds thereof will not violate any Requirement of Law or any Contractual Obligation of the Borrower or any of its Subsidiaries (other than violations which in the aggregate could not reasonably be expected to have a Material Adverse Effect and after taking into consideration all consents and waivers obtained by the Borrower) 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.
4.6.No Material Litigation.  Except as set forth on Schedule 4.6 or disclosed in SEC Reports filed prior to the date of this Agreement, no litigation, investigation or proceeding of or before any arbitrator or Governmental Authority is pending or, to the knowledge of the Borrower, threatened by or against the Borrower or any of its Subsidiaries or against any of their respective properties or revenues (a) with respect to any of the Loan Documents or any of the transactions contemplated hereby or thereby, or (b) that could reasonably be expected to have a Material Adverse Effect.
4.7.No Default.  Neither the Borrower nor any of its Subsidiaries is in default under or with respect to any of its Contractual Obligations in any respect that could reasonably be expected to have a Material Adverse Effect.
4.8.Ownership of Property.  Except as set forth on Schedule 4.8, each of the Borrower and its Subsidiaries has title in fee simple to, or a valid leasehold interest in, or other appropriate property rights in, all its material real property, and good title to, or a valid leasehold interest in, all its other material Property.
4.9.Intellectual Property.  The Borrower and each of its Subsidiaries owns, or is licensed to use, all Intellectual Property necessary for the conduct of its business as currently conducted except for any such Intellectual Property that if it were not so owned or licensed could not reasonably be expected to have a Material Adverse Effect.  No material claim has been asserted and is pending by any Person challenging or questioning the use of any Intellectual Property or the validity or effectiveness of any Intellectual Property, nor does the Borrower know of any valid basis for any such claim.  The use of Intellectual Property by the Borrower and its Subsidiaries does not infringe on the rights of any Person in any material respect except for such claims and infringements that, in the aggregate, could not reasonably be expected to have a Material Adverse Effect.
4.10.Taxes.  Each of the Borrower and its Material Subsidiaries has filed or caused to be filed all Federal, state and other material tax returns that are required to be filed and has paid all taxes shown to be due and payable on said returns or on any assessments made against it or any of its Property and all other taxes, fees or other charges imposed on it or any of its Property by any Governmental Authority (other than any amount the validity of which is currently being contested in good faith and with respect to which reserves in conformity with GAAP have been provided on the books of the Borrower or its Material Subsidiaries, as the case may be); and no tax Lien has been filed, and, to the knowledge of the Borrower, no claim is being asserted, with respect to any such tax, fee or other charge.

Exhibit 10.1

4.11.Federal Regulations.  The Borrower is not engaged in the business of extending credit for the purpose of “purchasing” or “carrying” any “margin stock” within the respective meanings of each of the quoted terms under Regulation U as now and from time to time hereafter in effect, and no proceeds of any extension of credit hereunder will be used to “purchase” or “carry” any “margin stock” or to extend credit to others for the purpose of “purchasing” or “carrying” any “margin stock”, except in compliance with applicable law and regulations.
4.12.Labor Matters.  There are no strikes or other labor disputes against the Borrower or any of its Subsidiaries pending or, to the knowledge of the Borrower, threatened that (individually or in the aggregate) could reasonably be expected to have a Material Adverse Effect.  Hours worked by and payment made to employees of the Borrower and its Subsidiaries have not been in violation of the Fair Labor Standards Act or any other applicable Requirement of Law dealing with such matters that (individually or in the aggregate) could reasonably be expected to have a Material Adverse Effect.  All payments due from the Borrower or any of its Subsidiaries on account of employee health and welfare insurance that (individually or in the aggregate) could reasonably be expected to have a Material Adverse Effect if not paid have been paid or accrued as a liability on the books of the Borrower or the relevant Subsidiary.
4.13.ERISA.  Other than exceptions to any of the following that could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect:  (a) neither a Reportable Event nor a failure to meet the minimum funding standard (within the meaning of Section 412 of the Code or Sections 303 and 304 of ERISA) has occurred during the five‐year period prior to the date on which this representation is made or deemed made with respect to any Single Employer Plan, and each Single Employer Plan has complied in all material respects with the applicable provisions of ERISA and the Code; (b) no termination of a Single Employer Plan has occurred, and no Lien in favor of the PBGC or a Single Employer Plan has arisen, during such five-year period; (c) the present value of all accrued benefits under each Single Employer Plan (based on those assumptions used to fund such Single Employer Plans) did not, as of the last annual valuation date prior to the date on which this representation is made or deemed made, exceed the value of the assets of such Single Employer Plan allocable to such accrued benefits by a material amount; (d) neither the Borrower nor any Commonly Controlled Entity has had a complete or partial withdrawal from any Multiemployer Plan that has resulted or could reasonably be expected to result in a material liability under ERISA; and (e) no such Multiemployer Plan is in Reorganization or Insolvent.
4.14.Investment Company Act; Other Regulations.  The Borrower is not an “investment company”, or a company “controlled” by an “investment company”, within the meaning of the Investment Company Act of 1940, as amended.  Except as set forth on Schedule 4.14, the Borrower is not subject to regulation under any Requirement of Law (other than Regulation X of the Board) that limits its ability to incur Indebtedness under this Agreement.
4.15.Subsidiaries.  (a)  The Subsidiaries listed on Schedule 4.15 constitute all the Subsidiaries of the Borrower at the date hereof and each Material Subsidiary is indicated by an asterisk on Schedule 4.15.  Schedule 4.15 sets forth as of the date hereof the name and jurisdiction of incorporation of each Subsidiary and, as to each Subsidiary, the percentage of each class of Capital Stock owned by the Borrower.

Exhibit 10.1

(b)There are no outstanding subscriptions, options, warrants, calls, rights or other agreements or commitments (other than stock options granted to employees or directors and directors’ qualifying shares) of any nature relating to any Capital Stock of the Borrower or any Subsidiary, except as disclosed on Schedule 4.15.
4.16.Environmental Matters.  Except as set forth on Schedule 4.16 or disclosed in SEC Reports filed prior to the date hereof, other than exceptions to any of the following that could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect:
(i)The Borrower and its Material Subsidiaries:  (A) are, and within the period of all applicable statutes of limitation have been, in compliance with all applicable Environmental Laws; (B) hold all Environmental Permits (each of which is in full force and effect) required for any of their current or intended operations or for any property owned, leased, or otherwise operated by any of them; (C) are, and within the period of all applicable statutes of limitation have been, in compliance with all of their Environmental Permits; and (D) reasonably believe that:  each of their Environmental Permits will be timely renewed and complied with, without material expense; any additional Environmental Permits that may be required of any of them will be timely obtained and complied with, without material expense; and compliance with any Environmental Law that is or is expected to become applicable to any of them will be timely attained and maintained, without material expense.
(ii)Materials of Environmental Concern are not present at, on, under, in, or about any real property now or formerly owned, leased or operated by the Borrower or any of its Material Subsidiaries, or at any other location (including any location to which Materials of Environmental Concern have been sent for re-use or recycling or for treatment, storage, or disposal) which could reasonably be expected to (A) give rise to liability of the Borrower or any of its Material Subsidiaries under any applicable Environmental Law, or (B) interfere with the Borrower’s or any of its Material Subsidiaries’ continued operations, or (C) impair the fair saleable value of any real property owned or leased by the Borrower or any of its Material Subsidiaries (excluding any use restrictions that may be applicable to any such real property as of the date hereof).
(iii)There is no judicial, administrative, or arbitral proceeding (including any notice of violation or alleged violation) under or relating to any Environmental Law to which the Borrower or any of its Material Subsidiaries is, or to the knowledge of the Borrower or any of its Material Subsidiaries will be, named as a party that is pending or, to the knowledge of the Borrower or any of its Material Subsidiaries, threatened.
(iv)Neither the Borrower nor any of its Material Subsidiaries has been notified that it is a potentially responsible party under or relating to the federal Comprehensive Environmental Response, Compensation, and Liability Act, as 

Exhibit 10.1

amended or any similar Environmental Law, or with respect to any Materials of Environmental Concern.
(v)Neither the Borrower nor any of its Material Subsidiaries has entered into or agreed to any consent decree, order, or settlement or other agreement, or is subject to any judgment, decree, or order or other agreement, in any judicial, administrative, arbitral, or other forum for dispute resolution, the obligations of the Borrower and its Material Subsidiaries under which remain unsatisfied and unwaived (other than ongoing compliance obligations under any Environmental Law).
(vi)Neither the Borrower nor any of its Material Subsidiaries has assumed or retained, by contract or operation of law, any liabilities of any kind, fixed or contingent, known or unknown, under any Environmental Law or with respect to any Material of Environmental Concern.
4.17.Accuracy of Information, etc.  All information, reports and other papers and data (other than projections) furnished to the Lenders by the Borrower, or on behalf of the Borrower, and all SEC Reports were, in each case at the date thereof, complete and correct in all material respects, or have been subsequently supplemented by other information, reports or other papers or data, to the extent necessary to give the Lenders a true and accurate knowledge of the subject matter in all material respects.  All projections with respect to the Borrower or any Material Subsidiary, if furnished by the Borrower, were prepared and presented in good faith by the Borrower based upon facts and assumptions that the Borrower believed to be reasonable in light of current and foreseeable conditions, it being understood that projections are subject to significant uncertainties and contingencies, many of which are beyond the control of the Borrower and that no assurance can be given that the financial results set forth in such projections will actually be realized and the Borrower shall be under no obligation to update such projections.  No document furnished or statement made in writing to the Lenders by or on behalf of the Borrower in connection with the negotiation, preparation or execution of this Agreement and no SEC Report contained as of the date thereof any untrue statement of a material fact, or omitted to state any such material fact necessary in order to make the statements contained therein not misleading.
4.18.Solvency.  The Borrower is, and after giving effect to the transactions contemplated hereby and the incurrence of all Indebtedness and obligations being incurred in connection herewith will be, Solvent.
4.19.Anti-Corruption; OFAC; Anti-Money Laundering.  
(a)Anti-Corruption.  None of the Borrower, any of its Subsidiaries, or any director or officer thereof, nor, to the Borrower’s knowledge, any employee, Affiliate,  agent or representative of the Borrower or of any of its Subsidiaries, has, in the course of its actions for, or on behalf of, the Borrower or any such Subsidiary, directly or indirectly (i) used any corporate funds of the Borrower or any such Subsidiary for any contribution, gift, entertainment or other expenses relating to political activity, in each case, in violation of the U.S. Foreign Corrupt Practices Act of 1977, as amended, or any other applicable anti-bribery or corruption Law (each, 

Exhibit 10.1

an “Anti-Corruption Law”), (ii) made any direct or indirect payment to any foreign or domestic government official or employee in violation of any applicable Anti- Corruption Law, (iii) violated or is in violation, in any material respect, of any provision of any applicable Anti-Corruption Law.
(b)OFAC.
(i)Neither the Borrower nor any of its Subsidiaries, nor, to the Borrower’s knowledge, any director, officer, employee agent, Affiliate or representative of the Borrower or any of its Subsidiaries, is, or is owned or controlled by a Person that is: the subject of any sanctions administered or enforced by OFAC or any other applicable sanctions authority (collectively, “Sanctions”), 
(ii)Neither the Borrower nor any of its Subsidiaries is located or organized or operating in a country or region or territory that is the subject of Sanctions (including Crimea, Cuba, Iran, North Korea, Sudan and Syria).
(iii)The Borrower will not, directly or, to its knowledge, indirectly, use the proceeds of the Loans, or lend, contribute or otherwise make available such proceeds to any Subsidiary, joint venture partner or other Person to fund or facilitate any activities or business of or with any Person, or in any country or territory, that, at the time of such funding or facilitation, is the subject of Sanctions.
(c)Anti-Money Laundering. The operations of the Borrower and its Subsidiaries are and have been conducted at all times in material compliance with all applicable Laws relating to terrorism or money laundering (collectively, the “Anti-Money Laundering Laws”), and no action, suit or proceeding by or before any Governmental Authority involving the Borrower or any of its Subsidiaries with respect to any potential material violation of any Anti-Money Laundering Law is pending or, to the knowledge of the Borrower, threatened.
SECTION 5.  CONDITIONS PRECEDENT
5.1.Conditions to Closing Date.  The agreement of each Lender to make the initial extension of credit requested to be made by it hereunder is subject to the satisfaction, prior to or concurrently with the making of such extension of credit on the Closing Date, of the following conditions precedent:
(a)Loan Documents.  The Administrative Agent shall have received this Agreement, executed and delivered by a duly authorized officer of the Borrower and the other parties hereto (including each Lender under the Original Credit Agreement as either a “Continuing Lender” or an “Exiting Lender”).
(b)No Default or Event of Default.  There shall not exist (pro forma for the incurrence of the Facility) any Default or Event of Default.
(c)Approvals.  All governmental and third party approvals necessary or, in the reasonable discretion of the Joint Lead Arrangers, advisable in connection with the 

Exhibit 10.1

transactions contemplated hereby and the continuing operations of the Borrower and its Subsidiaries shall have been obtained and be in full force and effect, and all applicable waiting periods shall have expired without any action being taken or threatened by any competent authority that would restrain, prevent or otherwise impose materially adverse conditions on the financings contemplated hereby.
(d)Fees. (i) The Lenders, the Joint Lead Arrangers and the Administrative Agent shall have received all fees required to be paid, and all expenses required to be reimbursed for which invoices have been presented (including reasonable fees, disbursements and other charges of counsel to the Agents), on or before the Closing Date and (ii) the Administrative Agent, on behalf of the Lenders under the Original Credit Agreement, shall have received, on or before the Closing Date, all fees accrued to such date and payable to such Lenders in respect of the Revolving Credit Commitments and Extensions of Credit under the Original Credit Agreement (including all Letter of Credit Fees and Commitment Fees thereunder).  Without limiting the generality of the foregoing, all fees required to be paid under the Fee Letters as of the Closing Date shall have been paid in full.  All such amounts will be paid with proceeds of Loans made on the Closing Date and will be reflected in the funding instructions given by the Borrower to the Administrative Agent on or before the Closing Date.
(e)Closing Certificate.  The Administrative Agent shall have received certificates of the Borrower, dated the Closing Date, substantially in the form of Exhibit B, with appropriate insertions and attachments.
(f)Good Standing. The Administrative Agent shall have received a copy of a certificate of good standing for the Borrower from the office of the secretary of state of the State of Delaware.
(g)Legal Opinions.  The Administrative Agent shall have received an executed legal opinion addressed to the Administrative Agent and the Lenders and in form and substance reasonably satisfactory to the Joint Lead Arrangers from Timothy P. Olson, Senior Corporate Counsel and Corporate Secretary of the Borrower and its Subsidiaries.
(h)PATRIOT Act, Etc. The Lenders shall have received, at least five Business Days prior to the Closing Date, all documentation and other information required by regulatory authorities under applicable “know your customer” and anti-money laundering rules and regulations, including the Patriot Act.
5.2.Conditions to Each Extension of Credit or Increase of Revolving Credit Commitments.  The agreement of each Lender to make any extension of credit requested to be made by it hereunder on any date (including any extension of credit made on the Closing Date) or to increase the Revolving Credit Commitments hereunder are subject to the satisfaction of the following conditions precedent:
(a)Representations and Warranties.  Each of the representations and warranties made by the Borrower in or pursuant to the Loan Documents, other than those in Sections 4.2 and 4.6 (except to the extent applicable to an earlier date) shall be true and correct in all material respects on and as of such date as if made on and as of such date.

Exhibit 10.1

(b)No Default.  No Default or Event of Default shall have occurred and be continuing on such date or after giving effect to the extensions of credit requested to be made on such date.
Each borrowing by and issuance (or extension, or renewal) of a Letter of Credit (including an Auto-Extension Letter of Credit) on behalf of the Borrower hereunder shall constitute a representation and warranty by the Borrower as of the date of such extension of credit that the conditions contained in this Section 5.2 have been satisfied.
		
	SECTION 6.  
	AFFIRMATIVE COVENANTS

The Borrower hereby agrees that, so long as the Revolving Credit Commitments remain in effect, any Letter of Credit remains outstanding or any Loan or other Obligation is owing to any Lender or the Administrative Agent hereunder (other than any Obligation for indemnifications or reimbursements in respect of which no claim or demand for payment has been made), the Borrower shall and shall cause each of its Subsidiaries to:
6.1.Financial Statements.  Furnish to the Administrative Agent (which shall make available such items to the Lenders):
(a)as soon as available, but in any event within 90 days after the end of each fiscal year of the Borrower, a copy of the audited consolidated balance sheet of the Borrower and its Subsidiaries as at the end of such year and the related audited consolidated statements of income and cash flows for such year, setting forth in each case in comparative form the actual figures as of the end of and for the previous year, reported on without a “going concern” or like qualification or exception, or qualification arising out of the scope of the audit, by Deloitte & Touche LLP or other independent certified public accountants of nationally recognized standing, provided that delivering to the Administrative Agent copies of the Borrower’s Annual Report on Form 10-K for such period shall satisfy the foregoing requirements; and
(b)as soon as available, but in any event not later than 45 days after the end of each of the first three quarterly periods of each fiscal year of the Borrower, the unaudited consolidated balance sheet of the Borrower and its Subsidiaries as at the end of such quarter and the related unaudited consolidated statements of income and cash flows for such quarter and the portion of the fiscal year through the end of such quarter, setting forth in each case in comparative form the actual figures as of the end of and for the corresponding period in the previous year, certified by a Responsible Officer as being fairly stated in all material respects (subject to normal year‐end audit adjustments and the absence of footnotes), provided that delivering to the Administrative Agent copies of the Borrower’s Quarterly Report on Form 10-Q for such period shall satisfy the foregoing requirements; all such financial statements to be complete and correct in all material respects and to be prepared in reasonable detail and in accordance with GAAP applied consistently throughout the periods reflected therein and with prior periods (except as approved by such accountants or officer, as the case may be, and disclosed therein).  Information required to be delivered pursuant to the foregoing Section 6.1(a) and (b) or pursuant to Section 6.2(c) below shall be deemed to have been delivered on the date on which Borrower delivers electronic copies of such information to the Administrative Agent or on the date on which the Borrower provides notice (including notice by email) to the 

Exhibit 10.1

Administrative Agent (which notice the Administrative Agent will convey promptly to the Lenders) that such information has been posted on the SEC website on the Internet at sec.gov/edgar/searches.htm or at another website identified in such notice and accessible by the Lenders without charge; provided that (i) such notice may be included in a certificate delivered pursuant to Section 6.2(a) or (b) and (ii) the Borrower shall deliver paper copies of such information to the Administrative Agent, and the Administrative Agent shall deliver paper copies of such information to any Lender that requests such delivery.
6.2.Certificates; Other Information.  Furnish to the Administrative Agent (which shall make available such items to the Lenders):
(a)concurrently with the delivery of the financial statements referred to in Section 6.1(a), a certificate of the independent certified public accountants reporting on such financial statements stating that in making the examination necessary therefor no knowledge was obtained of any Default or Event of Default, except as specified in such certificate (it being understood that such certificate shall be limited to the items that independent certified public accountants are permitted to cover in such certificates pursuant to the professional standards and customs of their profession);
(b)concurrently with the delivery of any financial statements pursuant to Section 6.1, (i) a certificate of a Responsible Officer stating that, to the best of such Responsible Officer’s knowledge, the Borrower during such period has observed or performed all of its covenants and other agreements, and satisfied every condition, contained in this Agreement and the other Loan Documents to which it is a party to be observed, performed or satisfied by it, and that such Responsible Officer has obtained no knowledge of any Default or Event of Default except as specified in such certificate and (ii) a Compliance Certificate containing all information and calculations necessary for determining compliance by the Borrower and its Subsidiaries with the provisions of this Agreement referred to therein as of the last day of the fiscal quarter or fiscal year of the Borrower, as the case may be;
(c)within five Business Days after the same are sent, copies of all reports that the Borrower sends to the holders of any class of its public equity securities and, within five Business Days after the same are filed, copies of all registration statements, SEC Reports and other material reports that the Borrower may file with the SEC;
(d)concurrently with the delivery thereof or promptly after receipt thereof, a copy of all notices of default by the Borrower under either Indenture; and
(e)promptly, such additional financial and other information (including any bondable capacity reports or information then available) as any Lender may, through the Administrative Agent, from time to time reasonably request.
6.3.Payment of Obligations.  Pay, discharge or otherwise satisfy at or before maturity or before they become delinquent, as the case may be, all its obligations of whatever nature, material to the Borrower and its Subsidiaries taken as a whole, except where the amount or validity thereof is currently being contested in good faith and reserves in conformity with 

Exhibit 10.1

GAAP with respect thereto have been provided on the books of the Borrower or its Subsidiaries, as the case may be.
6.4.Conduct of Business and Maintenance of Existence; Compliance.  (a)  (i) Preserve, renew and keep in full force and effect its organizational existence and (ii) take all reasonable action to maintain all rights, privileges and franchises necessary or desirable in the normal conduct of its business, except, in each case, as otherwise permitted by Section 7.2 and except, in the case of clause (ii) above, to the extent that failure to do so could not, in the aggregate, reasonably be expected to have a Material Adverse Effect; and (b) comply with all Contractual Obligations and Requirements of Law, except to the extent that failure to comply therewith could not, in the aggregate, reasonably be expected to have a Material Adverse Effect.
6.5.Maintenance of Property; Insurance.  (a) Keep all material Property and systems useful and necessary in its business in good working order and condition, ordinary wear and tear and casualties excepted, (b) maintain with financially sound and reputable insurance companies insurance on all its material Property in at least such amounts and against at least such risks as are usually insured against in the same general area by companies engaged in the same or a similar business, and (c) except pursuant to Dispositions not prohibited hereby, maintain ownership, directly (and not through any Subsidiary), of all or substantially all of the businesses and assets of the Utility Business.
6.6.Inspection of Property; Books and Records; Discussions.  (a) Keep proper books of records and accounts in which full, true and correct entries in conformity with GAAP and all Requirements of Law shall be made of all dealings and transactions in relation to its business and activities and (b) upon reasonable prior notice, permit representatives of any Lender to visit and inspect any of its properties and examine and make abstracts from any of its books and records at any reasonable time and as often as may reasonably be desired and to discuss the business, operations, properties and financial and other condition of the Borrower and its Subsidiaries with officers and employees of the Borrower and its Subsidiaries and with its independent certified public accountants.
6.7.Notices.  Within five days after the Borrower or any of its Subsidiaries has knowledge of such event or circumstance under clause (a) below, within ten days after the Borrower or any of its Subsidiaries has knowledge of such event or circumstance under clause (b), (c) or (f) below, and within thirty days after the Borrower or any of its Subsidiaries has knowledge of such event or circumstance under clause (d) or (e) below, give notice to the Administrative Agent of:
(a)the occurrence of any Default or Event of Default;
(b)any (i) default or event of default under any Contractual Obligation of the Borrower or any of its Material Subsidiaries or (ii) litigation, investigation or proceeding which may exist at any time between the Borrower or any of its Material Subsidiaries and any Governmental Authority, that in either case, if not cured or if adversely determined, as the case may be, could reasonably be expected to have a Material Adverse Effect;

Exhibit 10.1

(c)any litigation or proceeding affecting the Borrower or any of its Material Subsidiaries (i) in which the amount involved is $50,000,000 or more and not covered by insurance, (ii) in which injunctive or similar relief is sought which if such relief is obtained could reasonably be expected to have a Material Adverse Effect, or (iii) which directly relates to any Loan Document;
(d)(i) the occurrence of any Reportable Event with respect to any Single Employer Plan, a failure to make any required contribution to a Single Employer Plan, the creation of any Lien in favor of the PBGC or a Single Employer Plan or any withdrawal from, or the termination, Reorganization or Insolvency of, any Multiemployer Plan or (ii) the institution of proceedings or the taking of any other action by the PBGC or the Borrower or any Commonly Controlled Entity or any Multiemployer Plan with respect to the withdrawal from, or the termination, Reorganization or Insolvency of, any Single Employer Plan or Multiemployer Plan;
(e)any notice that any Governmental Authority may deny any application for a material Environmental Permit sought by, or revoke or refuse to renew any material Environmental Permit held by, the Borrower; and
(f)any development or event that has had or could reasonably be expected to have a Material Adverse Effect.
Each notice pursuant to this Section shall be accompanied by a statement of a Responsible Officer setting forth details of the occurrence referred to therein and stating what action the Borrower or the relevant Subsidiary proposes to take with respect thereto.  For purposes of this Section 6.7, the Borrower shall be deemed to have knowledge of an event or circumstance if (i) the chief executive officer, president, chief financial officer, treasurer, general counsel or any assistant general counsel has actual knowledge or receives written notice thereof or (ii) any other officer of the Borrower charged with responsibility for the matter that is the subject of such notice requirement knows or should have known that such notice was required.
6.8.Environmental Laws.  (a) Comply in all respects with, and ensure compliance in all respects by all tenants and subtenants, if any, with, all applicable Environmental Laws, and obtain and comply in all respects with and maintain, and ensure that all tenants and subtenants obtain and comply in all material respects with and maintain, any and all licenses, approvals, notifications, registrations or permits required by applicable Environmental Laws, except in any such case as such failure to comply or obtain would not reasonably be expected to have a Material Adverse Effect.
(b)Conduct and complete all material investigations, studies, sampling and testing, and all remedial, removal and other actions required under Environmental Laws.
6.9.Further Assurances.  From time to time execute and deliver, or cause to be executed and delivered, such additional instruments, certificates or documents, and take such actions, as the Administrative Agent may reasonably request for the purposes of implementing or effectuating the provisions of this Agreement and the other Loan Documents.  Upon the exercise by the Administrative Agent or any Lender of any power, right, privilege or remedy pursuant to 

Exhibit 10.1

this Agreement or the other Loan Documents which requires any consent, approval, recording, qualification or authorization of any Governmental Authority, the Borrower will execute and deliver, or will cause the execution and delivery of, all applications, certifications, instruments and other documents and papers that the Administrative Agent or such Lender may be required to obtain from the Borrower or any of its Subsidiaries for such governmental consent, approval, recording, qualification or authorization.
6.10.Use of Proceeds.  Use  proceeds of the Loans for general corporate purposes (including commercial paper support) of the Borrower and its Subsidiaries in the ordinary course of business.  The Letters of Credit shall be used to support payment obligations of the Borrower or its Subsidiaries in each case incurred for general corporate purposes (including commercial paper support) of the Borrower and its Subsidiaries in the ordinary course of business.
6.11.Credit Ratings.  Use commercially reasonable efforts to maintain ratings by each of Moody’s, Fitch and Standard & Poor’s with respect to the Facility.
SECTION 7.  NEGATIVE COVENANTS
The Borrower hereby agrees that, so long as the Revolving Credit Commitments remain in effect, any Letter of Credit remains outstanding or any Loan or other Obligation is owing to any Lender or the Administrative Agent hereunder (other than any Obligation for indemnifications or reimbursements in respect of which no claim or demand for payment has been made), the Borrower shall not, and shall not permit any of its Subsidiaries to, directly or indirectly:
7.1.Consolidated Debt to Capitalization Ratio.  Permit the Consolidated Debt to Capitalization Ratio as of the end of any fiscal quarter to exceed 65.0%.
7.2.Limitation on Fundamental Changes.  Enter into any merger, consolidation or amalgamation, or liquidate, wind up or dissolve itself (or suffer any liquidation or dissolution), Dispose of all or substantially all of its Property or business or, in the case of the Borrower, Dispose of all or substantially all of the South Dakota Utility Business or the Montana Utility Business, except that:
(a)any Subsidiary of the Borrower may be merged or consolidated with or into the Borrower (provided that the Borrower shall be the continuing or surviving corporation); and
(b)any Subsidiary of the Borrower may Dispose of any or all of its assets (upon voluntary liquidation, dissolution or otherwise) to the Borrower.
7.3.Limitation on Transactions with Affiliates.  Other than any transaction set forth on Schedule 7.3, enter into any transaction, including any purchase, sale, lease or exchange of Property, the rendering of any service or the payment of any management, advisory or similar fees, with any Affiliate (other than the Borrower and its Subsidiaries) unless such transaction is (a) in the ordinary course of business of the Borrower or such Subsidiary, as the case may be, and (b) upon fair and reasonable terms no less favorable to the Borrower or such Subsidiary, as 

Exhibit 10.1

the case may be, than it would obtain in a comparable arm’s length transaction with a Person that is not an Affiliate.
7.4.Limitation on Changes in Fiscal Periods.  Permit the fiscal year of the Borrower to end on a day other than December 31 or change the Borrower’s method of determining fiscal quarters.
7.5.Limitation on Negative Pledge Clauses.  Enter into or suffer to exist or become effective any agreement that prohibits or limits the ability of the Borrower or any of its Material Subsidiaries to create, incur, assume or suffer to exist any Lien upon any of its Property or revenues, whether now owned or hereafter acquired, to secure the Obligations other than (a) this Agreement and the other Loan Documents, (b) the Indentures, (c) any agreements governing any purchase money Liens or Capital Lease Obligations otherwise permitted hereby (in which case, any prohibition or limitation shall only be effective against the assets financed thereby) and (d) any other agreement listed on Schedule 7.5.
7.6.Limitation on Restrictions on Subsidiary Distributions.  Enter into or suffer to exist or become effective any consensual encumbrance or restriction on the ability of any Material Subsidiary to (a) pay dividends or make distributions with respect to the Capital Stock of such Subsidiary held by the Borrower or any other Subsidiary or (b) make Investments in the Borrower or any other Subsidiary or (c) transfer any of its assets to the Borrower or any other Subsidiary, except for such encumbrances or restrictions existing under or by reason of (i) any restrictions existing under the Loan Documents, (ii) any restrictions existing on the date hereof under the Indentures and (iii) any restrictions with respect to a Subsidiary imposed pursuant to an agreement that has been entered into in connection with the Disposition of all or substantially all of the Capital Stock or assets of such Subsidiary.
7.7.Limitation on Lines of Business.  Enter into any business, either directly or through any Subsidiary, except for those businesses in which the Borrower and its Subsidiaries are engaged on the date of this Agreement or that are reasonably related thereto.
SECTION 8.  EVENTS OF DEFAULT
If any of the following events shall occur and be continuing:
(a)(i) the Borrower shall fail to pay any principal of any Loan or Reimbursement Obligation when due in accordance with the terms hereof, or (ii) the Borrower shall fail to pay any interest on any Loan or Reimbursement Obligation, or any other amount payable hereunder or under any other Loan Document, in the case of clause (ii), within five days after any such interest or other amount becomes due in accordance with the terms hereof or thereof; or
(b)any representation or warranty made or deemed made by the Borrower herein or in any other Loan Document or that is contained in any certificate, document or financial or other statement furnished by it at any time under or in connection with this Agreement or any such other Loan Document shall prove to have been inaccurate in any material respect on or as of the date made or deemed made or furnished; or

Exhibit 10.1

(c)the Borrower shall default in the observance or performance of any agreement contained in clause (b)(iii) of Section 4.19 or clause (i) or (ii) of Section  6.4(a) (with respect to the Borrower only) or Section 7 of this Agreement; or
(d)the Borrower shall default in the observance or performance of any other agreement contained in this Agreement or any other Loan Document, other than as provided in paragraphs (a) through (c) of this Section, and such default shall continue unremedied for a period of 30 days; or
(e)the Borrower or any of its Material Subsidiaries shall (i) default in making any payment of any principal of, or interest on, any Indebtedness (including any Guarantee Obligation, but excluding the Loans and Reimbursement Obligations) beyond the period of grace, if any, provided in the instrument or agreement under which such Indebtedness was created; or (ii) default in the observance or performance of any other agreement or condition relating to any such Indebtedness or contained in any instrument or agreement evidencing, securing or relating thereto, or any other event shall occur or condition exist, the effect of which default or other event or condition is to cause, or to permit the holder or beneficiary of such Indebtedness (or a trustee or agent on behalf of such holder or beneficiary) to cause, with the giving of notice if required, such Indebtedness to become due prior to its stated maturity or to become subject to a mandatory offer to purchase by the obligor thereunder or (in the case of any such Indebtedness constituting a Guarantee Obligation) to become payable; provided, that a default, event or condition described in clause (i) or (ii) of this paragraph (e) shall not at any time constitute an Event of Default unless, at such time, one or more defaults, events or conditions of the type described in clauses (i) and (ii) of this paragraph (e) shall have occurred and be continuing with respect to Indebtedness the outstanding principal amount of which exceeds in the aggregate $50,000,000; or
(f)(i) the Borrower or any of its Material Subsidiaries shall commence any case, proceeding or other action (A) under any existing or future law of any jurisdiction, domestic or foreign, relating to bankruptcy, insolvency, reorganization or relief of debtors, seeking to have an order for relief entered with respect to it, or seeking to adjudicate it a bankrupt or insolvent, or seeking reorganization, arrangement, adjustment, winding‐up, liquidation, dissolution, composition or other relief with respect to it or its debts, or (B) seeking appointment of a receiver, trustee, custodian, conservator or other similar official for it or for all or any substantial part of its assets, or the Borrower or any of its Material Subsidiaries shall make a general assignment for the benefit of its creditors; or (ii) there shall be commenced against the Borrower or any of its Material Subsidiaries any case, proceeding or other action of a nature referred to in clause (i) above that (A) results in the entry of an order for relief or any such adjudication or appointment or (B) remains undismissed, undischarged or unbonded for a period of 60 days; or (iii) there shall be commenced against the Borrower or any of its Material Subsidiaries any case, proceeding or other action seeking issuance of a warrant of attachment, execution, distraint or similar process against all or any substantial part of its assets that results in the entry of an order for any such relief that shall not have been vacated, discharged, or stayed or bonded pending appeal within 60 days from the entry thereof; or (iv) the Borrower or any of its Material Subsidiaries shall take any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any of the acts set forth in clause (i), (ii), or (iii) above; or (v) the 

Exhibit 10.1

Borrower or any of its Material Subsidiaries shall generally not, or shall be unable to, or shall admit in writing its inability to, pay its debts as they become due; or
(g) (i) any Person shall engage in any “prohibited transaction” (as defined in Section 406 of ERISA or Section 4975 of the Code) involving any Plan, (ii) any failure to meet the minimum funding standard (within the meaning of Section 412 of the Code or Sections 303 and 304 of ERISA), whether or not waived, shall exist with respect to any Plan, or any Lien in favor of the PBGC or a Plan shall arise on the assets of the Borrower or any Commonly Controlled Entity, (iii) a Reportable Event shall occur with respect to, or proceedings shall commence to have a trustee appointed, or a trustee shall be appointed, to administer or to terminate, any Single Employer Plan, which Reportable Event or commencement of proceedings or appointment of a trustee is, in the reasonable opinion of the Required Lenders, likely to result in the termination of such Plan for purposes of Title IV of ERISA in an involuntary or distress termination, (iv) any Single Employer Plan shall terminate for purposes of Title IV of ERISA, (v) the Borrower or any Commonly Controlled Entity shall, or in the reasonable opinion of the Required Lenders shall be likely to, incur any liability in connection with a withdrawal from, or the Insolvency or Reorganization of, a Multiemployer Plan or (vi) any other event or condition shall occur or exist with respect to a Plan; and in each case in clauses (i) through (vi) above, such event or condition, together with all other such events or conditions, if any, could, in the sole judgment of the Required Lenders, reasonably be expected to have a Material Adverse Effect; or
(h)one or more judgments or decrees shall be entered against the Borrower or any of its Material Subsidiaries involving for the Borrower and its Subsidiaries taken as a whole a liability (to the extent not covered by insurance as to which the relevant insurance company has acknowledged coverage) of $50,000,000 or more, and all such judgments or decrees shall not have been vacated, discharged, stayed or bonded pending appeal within 60 days from the entry thereof; or
(i)there shall occur an “Event of Default” under the South Dakota First Mortgage Indenture or a “Default” under the Montana First Mortgage Indenture; provided that the waiver or cure of such “Event of Default” under the South Dakota First Mortgage Indenture, or such “Default” under the Montana First Mortgage Indenture, as the case may be, and the rescission and annulment of the consequences thereof under such Indenture will constitute a cure of the corresponding Event of Default hereunder and a rescission or annulment of the consequences thereof; or
(j)any Change of Control shall occur;
then, and in any such event, (A) if such event is an Event of Default specified in clause (i) or (ii) of paragraph (f) above with respect to the Borrower, automatically the Revolving Credit Commitments shall immediately terminate and the Loans hereunder (with accrued interest thereon) and all other amounts owing under this Agreement and the other Loan Documents shall immediately become due and payable, and (B) if such event is any other Event of Default, either or both of the following actions may be taken:  (i) with the consent of the Required Lenders, the Administrative Agent may, or upon the request of the Required Lenders, the Administrative Agent shall, by notice to the Borrower declare the Revolving Credit Commitments to be terminated forthwith, whereupon the Revolving Credit Commitments shall immediately 

Exhibit 10.1

terminate; and (ii) with the consent of the Required Lenders, the Administrative Agent may, or upon the request of the Required Lenders, the Administrative Agent shall, by notice to the Borrower, declare the Loans hereunder (with accrued interest thereon) and all other amounts owing under this Agreement and the other Loan Documents to be due and payable forthwith, whereupon the same shall immediately become due and payable.  In the case of all Letters of Credit with respect to which presentment for honor shall not have occurred at the time of an acceleration pursuant to this paragraph, the Borrower shall at such time Cash Collateralize an amount equal to the aggregate then undrawn and unexpired face amount of such Letters of Credit.  The Cash Collateral shall be applied by the Administrative Agent to the payment of drafts drawn under such Letters of Credit, and the unused portion thereof after all such Letters of Credit shall have expired or been fully drawn upon, if any, shall be applied to repay other obligations of the Borrower hereunder and under the other Loan Documents.  After all such Letters of Credit shall have expired or been fully drawn upon, all Reimbursement Obligations shall have been satisfied and all other obligations of the Borrower hereunder and under the other Loan Documents shall have been paid in full, the balance, if any, of the Cash Collateral shall be returned to the Borrower (or such other Person as may be lawfully entitled thereto).
		
	SECTION 9.  
	THE ADMINISTRATIVE AGENT

9.1.Appointment.  Each Lender hereby irrevocably designates and appoints the Administrative Agent (for the purposes of this Section 9, the term “Administrative Agent” shall also include any Issuing Lender acting in its capacity as such) as the agent of such Lender under this Agreement and the other Loan Documents, and each Lender irrevocably authorizes the Administrative Agent, in such capacity, to take such action on its behalf under the provisions of this Agreement and the other Loan Documents and to exercise such powers and perform such duties as are expressly delegated to the Administrative Agent by the terms of this Agreement and the other Loan Documents, together with such other powers as are reasonably incidental thereto.  Notwithstanding any provision to the contrary elsewhere in this Agreement, the Administrative Agent shall not have any duties or responsibilities, except those expressly set forth herein, or any fiduciary relationship with any Lender, and no implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read into this Agreement or any other Loan Document or otherwise exist against the Administrative Agent.
9.2.Delegation of Duties.  The Administrative Agent may execute any of its duties under this Agreement and the other Loan Documents by or through agents or attorneys‐in‐fact and shall be entitled to advice of counsel concerning all matters pertaining to such duties.  The Administrative Agent shall not be responsible for the negligence or misconduct of any agents or attorneys-in‐fact selected by it with reasonable care.
9.3.Exculpatory Provisions.  Neither the Administrative Agent nor any of its officers, directors, employees, agents, attorneys‐in‐fact or affiliates shall be (i) liable for any action lawfully taken or omitted to be taken by it or such Person under or in connection with this Agreement or any other Loan Document (except to the extent that any of the foregoing are found by a final and nonappealable decision of a court of competent jurisdiction to have resulted from its or such Person’s own gross negligence or willful misconduct) or (ii) responsible in any manner to any of the Lenders for any recitals, statements, representations or warranties made by the Borrower or any officer thereof contained in this Agreement or any other Loan Document or 

Exhibit 10.1

in any certificate, report, statement or other document referred to or provided for in, or received by the Administrative Agent under or in connection with, this Agreement or any other Loan Document or for the value, validity, effectiveness, genuineness, enforceability or sufficiency of this Agreement or any other Loan Document or for any failure of the Borrower to perform its obligations hereunder or thereunder.  The Administrative Agent shall not be under any obligation to any Lender to ascertain or to inquire as to the observance or performance of any of the agreements contained in, or conditions of, this Agreement or any other Loan Document, or to inspect the properties, books or records of the Borrower.
9.4.Reliance by the Administrative Agent.  The Administrative Agent shall be entitled to rely, and shall be fully protected in relying, upon any instrument, writing, resolution, notice, consent, certificate, affidavit, letter, telecopy, telex or teletype message, statement, order or other document or conversation believed by it to be genuine and correct and to have been signed, sent or made by the proper Person or Persons and upon advice and statements of legal counsel (including counsel to the Borrower), independent accountants and other experts selected by the Administrative Agent.  The Administrative Agent may deem and treat the payee of any Note as the owner thereof for all purposes unless such Note shall have been transferred in accordance with Section 10.6 and all actions required by such Section in connection with such transfer shall have been taken.  The Administrative Agent shall be fully justified in failing or refusing to take any action under this Agreement or any other Loan Document unless it shall first receive such advice or concurrence of the Required Lenders (or, if so specified by this Agreement, all Lenders or any other instructing group of Lenders specified by this Agreement) as it deems appropriate or it shall first be indemnified to its satisfaction by the Lenders against any and all liability and expense that may be incurred by it by reason of taking or continuing to take any such action.  The Administrative Agent shall in all cases be fully protected in acting, or in refraining from acting, under this Agreement and the other Loan Documents in accordance with a request of the Required Lenders (or, if so specified by this Agreement, all Lenders or any other instructing group of Lenders specified by this Agreement), and such request and any action taken or failure to act pursuant thereto shall be binding upon all the Lenders and all future holders of the Loans.
9.5.Notice of Default.  The Administrative Agent shall not be deemed to have knowledge or notice of the occurrence of any Default or Event of Default hereunder unless it shall have received written notice from a Lender or the Borrower referring to this Agreement, describing such Default or Event of Default and stating that such notice is a “notice of default”.  In the event that the Administrative Agent shall receive such a notice, the Administrative Agent shall give notice thereof to the Lenders.  The Administrative Agent shall take such action with respect to such Default or Event of Default as shall be reasonably directed by the Required Lenders (or, if so specified by this Agreement, all Lenders or any other instructing group of Lenders specified by this Agreement); provided that unless and until the Administrative Agent shall have received such directions, the Administrative Agent may (but shall not be obligated to) take such action, or refrain from taking such action, with respect to such Default or Event of Default as it shall deem advisable in the best interests of the Lenders.
9.6.Non‐Reliance on Administrative Agent and Other Lenders.  Each Lender expressly acknowledges that neither the Administrative Agent nor any of its officers, directors, employees, agents, attorneys‐in‐fact or affiliates have made any representations or warranties to 

Exhibit 10.1

it and that no act by the Administrative Agent hereafter taken, including any review of the affairs of  the Borrower or any affiliate of the Borrower, shall be deemed to constitute any representation or warranty by the Administrative Agent to any Lender.  Each Lender represents to the Administrative Agent that it has, independently and without reliance upon the Administrative Agent or any other Lender, and based on such documents and information as it has deemed appropriate, made its own appraisal of and investigation into the business, operations, property, financial and other condition and creditworthiness of the Borrower and its affiliates and made its own decision to make its Loans hereunder and enter into this Agreement.  Each Lender also represents that it will, independently and without reliance upon the Administrative Agent or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit analysis, appraisals and decisions in taking or not taking action under this Agreement and the other Loan Documents, and to make such investigation as it deems necessary to inform itself as to the business, operations, property, financial and other condition and creditworthiness of the Borrower and its affiliates.  Except for notices, reports and other documents expressly required to be furnished to the Lenders by the Administrative Agent hereunder, the Administrative Agent shall not have any duty or responsibility to provide any Lender with any credit or other information concerning the business, operations, property, condition (financial or otherwise), prospects or creditworthiness of the Borrower or any affiliate of the Borrower that may come into the possession of the Administrative Agent or any of its officers, directors, employees, agents, attorneys‐in‐fact or affiliates.
9.7.Indemnification.  The Lenders agree to indemnify the Administrative Agent in its capacity as such (to the extent not reimbursed by the Borrower and without limiting the obligation of the Borrower to do so), ratably according to their respective Aggregate Exposure Percentages in effect on the date on which indemnification is sought under this Section (or, if indemnification is sought after the date upon which the Revolving Credit Commitments shall have terminated and the Loans shall have been paid in full, ratably in accordance with such Aggregate Exposure Percentages immediately prior to such date), for, and to save the Administrative Agent harmless from and against, any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind whatsoever that may at any time (including at any time following the payment of the Loans) be imposed on, incurred by or asserted against the Administrative Agent in any way relating to or arising out of, the Revolving Credit Commitments, this Agreement, any of the other Loan Documents or any documents contemplated by or referred to herein or therein or the transactions contemplated hereby or thereby or any action taken or omitted by such Agent under or in connection with any of the foregoing; provided that no Lender shall be liable for the payment of any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements that are found by a final and nonappealable decision of a court of competent jurisdiction to have resulted from the Administrative Agent’s gross negligence or willful misconduct.  The agreements in this Section shall survive the payment of the Loans and all other amounts payable hereunder.
9.8.Agent in Its Individual Capacity.  The Administrative Agent and its affiliates may make loans to, accept deposits from and generally engage in any kind of business with the Borrower or any of its Subsidiaries as though the Administrative Agent were not an Administrative Agent.  With respect to its Loans made or renewed by it and with respect to any 

Exhibit 10.1

Letter of Credit issued or participated in by it, the Administrative Agent shall have the same rights and powers under this Agreement and the other Loan Documents as any Lender and may exercise the same as though it were not an agent hereunder and the terms “Lender” and “Lenders” shall include the Administrative Agent in its individual capacity.
9.9.Successor Agents.  The Administrative Agent may resign as Administrative Agent upon 10 days’ notice to the Lenders and the Borrower.  If the Administrative Agent shall resign as Administrative Agent under this Agreement and the other Loan Documents, then the Required Lenders shall appoint from among the Lenders a successor agent for the Lenders, which successor agent shall (unless an Event of Default under Section 8(a) or Section 8(f) with respect to the Borrower shall have occurred and be continuing) be subject to approval by the Borrower (which approval shall not be unreasonably withheld or delayed), whereupon such successor agent shall succeed to the rights, powers and duties of the Administrative Agent, and the term “Administrative Agent” shall mean such successor agent effective upon such appointment and approval, and the former Administrative Agent’s rights, powers and duties as Administrative Agent shall be terminated, without any other or further act or deed on the part of such former Administrative Agent or any of the parties to this Agreement or any holders of the Loans.  If no successor agent has accepted appointment as Administrative Agent by the date that is 10 days following a retiring Administrative Agent’s notice of resignation, the retiring Administrative Agent’s resignation shall nevertheless thereupon become effective, and the Lenders shall assume and perform all of the duties of the Administrative Agent hereunder until such time, if any, as the Required Lenders appoint a successor agent as provided for above.  After any retiring Administrative Agent’s resignation as such agent hereunder, the provisions of this Section 9 shall inure to its benefit as to any actions taken or omitted to be taken by it (i) while it was an agent under this Agreement and the other Loan Documents and (ii) after such resignation or removal for as long as it continues to act in any capacity hereunder or under the other Loan Documents, including (a) holding any collateral security on behalf of any of the Lenders and (b) in respect of any actions taken in connection with transferring the agency to any successor Administrative Agent.
9.10.The Joint Lead Arrangers; the Syndication Agent; the Co-Documentation Agents.  Neither the Joint Lead Arrangers, the Syndication Agent nor the Co-Documentation Agents, in their respective capacities as such, shall have any duties or responsibilities, and shall incur no liability, under this Agreement and the other Loan Documents.
SECTION 10.  MISCELLANEOUS
10.1.Amendments and Waivers.  Neither this Agreement or any other Loan Document, nor any terms hereof or thereof may be amended, supplemented or modified except in accordance with the provisions of this Section 10.1.  The Required Lenders and the Borrower may, or (with the written consent of the Required Lenders) the Administrative Agent and the Borrower may, from time to time, (a) enter into written amendments, supplements or modifications hereto and to the other Loan Documents (including amendments and restatements hereof or thereof) for the purpose of adding any provisions to this Agreement or the other Loan Documents or changing in any manner the rights of the Lenders or of the Borrower hereunder or thereunder or (b) waive, on such terms and conditions as may be specified in the instrument of waiver, any of the requirements of this Agreement or the other Loan Documents or any Default 

Exhibit 10.1

or Event of Default and its consequences; provided, however that no such waiver, amendment, supplement or modification shall be effective until notice has been provided to the Administrative Agent in accordance with Section 10.2 of this Agreement; provided, further, that the Administrative Agent may, with the consent of the Borrower only and without the need to obtain the consent of any Lender, amend, supplement or modify this Agreement or any other Loan Document to cure any ambiguity, omission, defect or inconsistency, so long as such amendment, supplement or modification does not adversely affect the rights of any Lender; provided, further, that no such waiver and no such amendment, supplement or modification shall, without the consent of the requisite Lenders specified below:
(i)forgive the principal amount or extend the final scheduled date of maturity of any Loan or Reimbursement Obligation, reduce the stated rate of any interest or fee payable under this Agreement (except (x) in connection with the waiver of applicability of any post-default increase in interest rates (which waiver shall be effective with the consent of the Required Lenders and (y) that any amendment or modification of defined terms used in the financial covenants in this Agreement shall not constitute a reduction in the rate of interest or fees for purposes of this clause (i)) or extend the scheduled date of any payment thereof, or increase the amount or extend the expiration date of any Revolving Credit Commitment of any Lender, in each case without the consent of each Lender directly affected thereby;
(ii)amend, modify or waive any provision of this Section, reduce any percentage specified in the definition of Required Lenders or consent to the assignment or transfer by the Borrower of any of its rights and obligations under this Agreement and the other Loan Documents, in each case without the consent of all the Lenders;
(iii)amend, modify or waive any condition precedent to any extension of credit under the Revolving Credit Facility set forth in Section 5.2 (including the waiver of an existing Default or Event of Default required to be waived in order for such extension of credit to be made) without the consent of the Required Lenders;
(iv)reduce the percentage specified in the definition of Required Lenders without the consent of all of the Lenders;
(v)amend, modify or waive any provision of Section 9, or any other provision affecting the rights, duties or obligations of any Agent, without the consent of any Agent directly affected thereby;
(vi)amend, modify or waive any provision of Section 2.14 or 10.7 without the consent of each Lender directly affected thereby; 
(vii)amend, modify or waive any provision of Section 3 (or Annex B) without the consent of each Issuing Lender affected thereby; 

Exhibit 10.1

(viii)impose restrictions on assignments and participations that are more restrictive than, or additional to, those set forth in Section 10.6 without the consent of all the Lenders; or
(ix)except as provided in Section 2.21, change any provision hereof in a manner that would alter the pro rata sharing of payments required by Section 2.14, without the written consent of each Lender whose pro rata share could otherwise be reduced thereby.
Any such waiver and any such amendment, supplement or modification shall apply equally to each of the Lenders and shall be binding upon the Borrower, the Lenders, the Administrative Agent and all future holders of the Loans.  In the case of any waiver, the Borrower, the Lenders and the Administrative Agent shall be restored to their former position and rights hereunder and under the other Loan Documents, and any Default or Event of Default waived shall be deemed to be cured and not continuing; but no such waiver shall extend to any subsequent or other Default or Event of Default, or impair any right consequent thereon.  Any such waiver, amendment, supplement or modification shall be effected by a written instrument signed by the parties required to sign pursuant to the foregoing provisions of this Section; provided, that delivery of an executed signature page of any such instrument by facsimile or email transmission shall be effective as delivery of a manually executed counterpart thereof.
For the avoidance of doubt, this Agreement and any other Loan Document may be amended (or amended and restated) with the written consent of the Required Lenders, the Administrative Agent and the Borrower (x) to add one or more additional credit facilities to this Agreement and to permit the extensions of credit from time to time outstanding thereunder and the accrued interest and fees in respect thereof (collectively, the “Additional Extensions of Credit”) to share ratably in the benefits of this Agreement and the other Loan Documents with the Revolving Extensions of Credit and the accrued interest and fees in respect thereof and (y) to include appropriately the Lenders holding such credit facilities in any determination of the Required Lenders.
For the avoidance of doubt, an increase in the Revolving Credit Commitments pursuant to Section 2.1(b) shall not be deemed an amendment, modification or supplement to this Agreement.
10.2.Notices.  All notices, requests and demands to or upon the respective parties hereto to be effective shall be in writing (including by telecopy or electronic communication), and, unless otherwise expressly provided herein, shall be deemed to have been duly given or made when delivered, or three Business Days after being deposited in the mail, postage prepaid, or, in the case of telecopy notice or electronic communication, when received, addressed (i) in the case of the Borrower and the Administrative Agent, as set forth below, (ii) in the case of the Lenders, as set forth in an administrative questionnaire delivered to the Administrative Agent or, in the case of a Lender which becomes a party to this Agreement pursuant to an Assignment and Acceptance, in such Assignment and Acceptance and (iii) in the case of any party, to such other address as such party may hereafter notify to the other parties hereto:

Exhibit 10.1

	
		
	The Borrower:
	Northwestern Corporation
3010 West 69th Street
Sioux Falls, South Dakota  57108
Attention:  Chief Financial Officer
Telephone:  (605) 978-2909
Email:  brian.bird@northwestern.com

	with a copy to:
	Northwestern Corporation
208 N Montana Avenue, Suite 205
Helena, Montana  59601
Attention:  General Counsel
Telephone:  (406) 443-8958
Email: heather.grahame@northwestern.com

	The Administrative Agent:
	Gerund Diamond
Agency Management
Mail Code:  IL4-135-09-61 
Telephone:  (312) 992-8588 
Facsimile:  (312) 453-3635 
Email:  gerund.diamond@baml.com

	Issuing Lender:
	As notified by such Issuing Lender to the Administrative Agent and the Borrower

provided that any notice, request or demand to or upon the any Agent, any Issuing Lender or any Lender shall not be effective until received.
Notices and other communications to the Lenders hereunder may be delivered or furnished by electronic communications (including email, FpML messaging, and Internet or intranet websites) pursuant to procedures approved by the Administrative Agent; provided that the foregoing shall not apply to notices pursuant to Section 2 unless otherwise agreed by the Administrative Agent and the applicable Lender.  The Administrative Agent or the Borrower may, in its reasonable discretion, agree to accept notices and other communications to it hereunder by electronic communications pursuant to procedures approved by it; provided that approval of such procedures may be limited to particular notices or communications.
The Borrower hereby acknowledges that (a) the Administrative Agent may, but shall not be obligated to make available to the Lenders materials and/or information provided by, or on behalf of, the Borrower hereunder (collectively, the “Borrower Materials”) by posting the Borrower Materials on Intralinks, Syndtrak, ClearPar, or a substantially similar electronic transmission system (the “Platform”) and (b) certain of the Lenders (each, a “Public Lender”) may have personnel who do not wish to receive material non-public information with respect to the Borrower or its Affiliates, or the respective securities of any of the foregoing, and who may be engaged in investment and other market-related activities with respect to such Persons’ securities.  The Borrower hereby agrees that (w) all Borrower Materials that are to be made 

Exhibit 10.1

available to Public Lenders shall be clearly and conspicuously marked “PUBLIC” which, at a minimum, shall mean that the word “PUBLIC” shall appear prominently on the first page thereof; (x) by marking Borrower Materials “PUBLIC,” the Borrower shall be deemed to have authorized the Administrative Agent, the Joint Lead Arrangers, the L/C Participants and the Lenders to treat such Borrower Materials as not containing any material non-public information with respect to the Borrower or its securities for purposes of United States Federal and state securities laws (provided, however, that to the extent such Borrower Materials contain non-public information, they shall be treated as set forth in Section 10.14); (y) all Borrower Materials marked “PUBLIC” are permitted to be made available through a portion of the Platform designated “Public Side Information;” and (z) the Administrative Agent and the Arranger shall be entitled to treat any Borrower Materials that are not marked “PUBLIC” as being suitable only for posting on a portion of the Platform not designated “Public Side Information.”  
THE PLATFORM IS PROVIDED “AS IS” AND “AS AVAILABLE.” NEITHER THE ADMINISTRATIVE AGENT NOR ANY OF ITS AFFILIATES WARRANTS THE ACCURACY OR COMPLETENESS OF THE BORROWER MATERIALS OR THE ADEQUACY OF THE PLATFORM AND EACH EXPRESSLY DISCLAIMS LIABILITY FOR ERRORS OR OMISSIONS IN THE BORROWER MATERIALS. NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NONINFRINGEMENT OF THIRD-PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS IS MADE BY THE ADMINISTRATIVE AGENT OR ANY OF ITS AFFILIATES IN CONNECTION WITH THE BORROWER MATERIALS OR THE PLATFORM. IN NO EVENT SHALL THE ADMINISTRATIVE AGENT OR ANY OF ITS AFFILIATES HAVE ANY LIABILITY TO ANY LENDER OR ANY OTHER PERSON FOR DAMAGES OF ANY KIND, WHETHER OR NOT BASED ON STRICT LIABILITY AND INCLUDING DIRECT OR INDIRECT, SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES, LOSSES OR EXPENSES (WHETHER IN TORT, CONTRACT OR OTHERWISE) ARISING OUT OF ANY LENDER’S OR THE ADMINISTRATIVE AGENT’S TRANSMISSION OF BORROWER MATERIALS THROUGH THE INTERNET, EXCEPT TO THE EXTENT THE LIABILITY OF ANY SUCH PERSON IS FOUND IN A FINAL RULING BY A COURT OF COMPETENT JURISDICTION TO HAVE RESULTED FROM SUCH PERSON’S GROSS NEGLIGENCE OR WILLFUL MISCONDUCT.
10.3.No Waiver; Cumulative Remedies.  No failure to exercise and no delay in exercising, on the part of the Administrative Agent or any Lender, any right, remedy, power or privilege hereunder or under the other Loan Documents shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege.  The rights, remedies, powers and privileges herein provided are cumulative and not exclusive of any rights, remedies, powers and privileges provided by law.
10.4.Survival of Representations and Warranties.  All representations and warranties made herein, in the other Loan Documents and in any document, certificate or statement delivered pursuant hereto or in connection herewith shall survive the execution and delivery of this Agreement and the making of the Loans and other extensions of credit hereunder.

Exhibit 10.1

10.5.Payment of Expenses.  The Borrower agrees (a) to pay or reimburse the Administrative Agent for all its reasonable and documented or invoiced out‐of‐pocket costs and expenses incurred in connection with the syndication of the Facilities (including legal expenses (but limited to expenses of one legal counsel and, if reasonably necessary or advisable, of one regulatory counsel and a single local counsel in any relevant jurisdiction )) (other than fees payable to syndicate members) and the development, preparation and execution of, and any amendment, supplement or modification to, this Agreement and the other Loan Documents and any other documents prepared in connection herewith or therewith, and the consummation and administration of the transactions contemplated hereby and thereby, including the reasonable fees and disbursements and other charges of counsel to the Administrative Agent and the charges of Intralinks, (b) to pay or reimburse the Administrative Agent and any Issuing Lender and, if incurred during the continuance of an Event of Default, each Lender for all their costs and expenses incurred in connection with the enforcement or preservation of any rights under this Agreement, the other Loan Documents and any other documents prepared in connection herewith or therewith, including the fees and disbursements of counsel to such Person (including the allocated fees and disbursements and other charges of in-house counsel, but otherwise limited to expenses of one legal counsel and, if reasonably necessary or advisable, of one regulatory counsel and a single local counsel in any relevant jurisdiction for all such Persons unless, in the reasonable opinion of any such Person, representation of all such Persons by such counsel would be inappropriate due to the existence of an actual or potential conflict of interest), (c) to pay, indemnify, or reimburse each Lender, each Issuing Lender and the Administrative Agent for, and hold each Lender, each Issuing Lender and the Administrative Agent harmless from, any and all recording and filing fees and any and all liabilities with respect to, or resulting from any delay in paying, stamp, excise and other taxes, if any, which may be payable or determined to be payable in connection with the execution and delivery of, or consummation or administration of any of the transactions contemplated by, or any amendment, supplement or modification of, or any waiver or consent under or in respect of, this Agreement, the other Loan Documents and any such other documents, and (d) to pay, indemnify or reimburse each Lender, each Issuing Lender, each Agent, their respective Affiliates, successors and assigns, and their respective officers, directors, trustees, employees, advisors, agents, controlling persons and members (each, an “Indemnitee”) for, and hold each Indemnitee harmless from and against any and all other liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever incurred by an Indemnitee or asserted against any Indemnitee by any third party or by the Borrower arising out of, in connection with, or as a result of (and in each case regardless of whether such matter is initiated by a third party or by the Borrower or any of their respective Affiliates or equity holders) (i) the execution or delivery of this Agreement, any other Loan Document or any agreement or instrument contemplated hereby or thereby, the performance by the parties hereto or thereto of their respective obligations hereunder or thereunder or the consummation of the transactions contemplated hereby or thereby, (ii) any Loan or Letter of Credit or the use or proposed use of the proceeds therefrom (including any refusal by any Issuing Bank to honor a demand for payment under a Letter of Credit if the documents presented in connection with such demand do not strictly comply with the terms of such Letter of Credit), (iii) any actual or alleged presence or release of Materials of Environmental Concern on or from any property owned, occupied or operated by the Borrower or any of its Subsidiaries, or any liability related to any Environmental Law related in any way to the Borrower or any of its Subsidiaries or any of their respective properties, or (iv) any actual or 

Exhibit 10.1

prospective claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort or any other theory, whether brought by any third party or by the Borrower, and regardless of whether any Indemnitee is a party thereto (all the foregoing in this clause (d), collectively, the “Indemnified Liabilities”); provided that no Indemnitee will be indemnified for any claim, loss, damage, liability or expense to the extent the same resulted from (A) the gross negligence, bad faith or willful misconduct of the respective Indemnitee, any of its Affiliates or their respective officers, directors, trustees, employees, advisors, agents, controlling persons and members (as determined by a court of competent jurisdiction in a final and non-appealable judgment), (B) any claim, litigation, investigation or proceeding solely between or among Indemnified Persons other than actions against the Administrative Agent, the Joint Lead Arrangers or other persons acting in an agency or similar role in their capacity as such (and which does not involve an act or omission of the Borrower or any of its affiliates) and (C) any legal expenses in excess of the expenses of one legal counsel and, if reasonably necessary or advisable, of one regulatory counsel and a single local counsel in any relevant jurisdiction for all Indemnitees unless, in the reasonable opinion of an Indemnitee, representation of all Indemnitees by such counsel would be inappropriate due to the existence of an actual or potential conflict of interest.  No Indemnitee shall be liable for any damages arising from the use by unauthorized persons of information, data, reports or other materials sent through electronic, telecommunications or other information transmission systems that are intercepted by such persons (unless it is finally judicially determined that such interception was directly a result of the gross negligence or willful misconduct of such Indemnitee) or for any special, indirect, consequential or punitive damages in connection with the Facilities.  Without limiting the foregoing, and to the extent permitted by applicable Law, the Borrower agrees not to assert and to cause its Subsidiaries not to assert, and hereby waives and agrees to cause its Subsidiaries to waive, all rights for contribution or any other rights of recovery with respect to all claims, demands, penalties, fines, liabilities, settlements, damages, costs and expenses of whatever kind or nature, under or related to Environmental Laws, that any of them might have by statute or otherwise against any Indemnitee.  All amounts due under this Section shall be payable not later than 30 days after written demand therefor.  Statements payable by the Borrower pursuant to this Section shall be submitted to its Chief Financial Officer (Brian Bird) (Telephone: (605) 978-2909; Email:  brian.bird@northwestern.com), at the address of the Borrower set forth in Section 10.2, or to such other Person or address as may be hereafter designated by the Borrower in a notice to the Administrative Agent.  The agreements in this Section shall survive repayment of the Loans and all other amounts payable hereunder.
10.6.Successors and Assigns; Participations and Assignments.  (a)  This Agreement shall be binding upon and inure to the benefit of the Borrower, the Lenders, the Administrative Agent, all future holders of the Loans and their respective successors and assigns, except that the Borrower may not assign or transfer any of its rights or obligations under this Agreement without the prior written consent of the Administrative Agent and each Lender.
(b)Any Lender may, in the ordinary course of its business, without the consent of the Borrower, in accordance with applicable law, at any time sell to one or more banks, financial institutions or other entities (each, a “Participant”) participating interests in any Loan owing to such Lender, any Revolving Credit Commitment of such Lender or any other interest of such Lender hereunder and under the other Loan Documents.  In the event of any such sale by a Lender of a participating interest to a Participant, such Lender’s obligations under this 

Exhibit 10.1

Agreement to the other parties to this Agreement shall remain unchanged, such Lender shall remain solely responsible for the performance thereof, such Lender shall remain the holder of any such Loan for all purposes under this Agreement and the other Loan Documents, and the Borrower and the Administrative Agent shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement and the other Loan Documents.  In no event shall any Participant under any such participation have any right to approve any amendment or waiver of any provision of any Loan Document, or any consent to any departure by the Borrower therefrom, except to the extent that such amendment, waiver or consent would reduce the principal of, or interest on, the Loans or any fees or other amounts payable hereunder, in each case to the extent subject to such participating interest, or postpone any date fixed for any payment of principal of, or interest on, the Loans or any fees or other amounts payable hereunder, in each case to the extent subject to such participating interest.  The Borrower agrees that if amounts outstanding under this Agreement and the Loans are due or unpaid, or shall have been declared or shall have become due and payable upon the occurrence of an Event of Default, each Participant shall, to the maximum extent permitted by applicable law, be deemed to have the right of setoff in respect of its participating interest in amounts owing under this Agreement to the same extent as if the amount of its participating interest were owing directly to it as a Lender under this Agreement; provided that, in purchasing such participating interest, such Participant shall be deemed to have agreed to share with the Lenders the proceeds thereof as provided in Section 10.7(a) as fully as if such Participant were a Lender hereunder.  The Borrower also agrees that each Participant shall be entitled to the benefits and subject to the obligations of Sections 2.15, 2.16 and 2.17 with respect to its participation in the Revolving Credit Commitments and the Loans outstanding from time to time as if such Participant were a Lender or Assignee under Section 10.6(c); provided that, in the case of Section 2.16, such Participant shall have complied with the requirements of said Section; and provided, further, that (A) such Participant agrees to be subject to the provisions of Section 2.19 and 2.20 as if it were an Assignee under Section 10.6(c) and(B) no Participant shall be entitled to receive any greater amount pursuant to any such Section than the transferor Lender would have been entitled to receive in respect of the amount of the participation transferred by such transferor Lender to such Participant had no such transfer occurred.  Each Lender that sells a participation shall, acting solely for this purpose as an agent of the Borrower, maintain a register on which it enters the name and address of each Participant and the principal amounts (and stated interest) of each Participant’s interest in the Loans or other obligations under the Loan Documents (the “Participant Register”); provided that no Lender shall have any obligation to disclose all or any portion of the Participant Register (including the identity of any Participant or any information relating to a Participant's interest in any commitments, loans, letters of credit or its other obligations under any Loan Document) to any Person except to the extent that such disclosure is necessary to establish that such commitment, loan, letter of credit or other obligation is in registered form under Section 5f.103-1(c) of the United States Treasury Regulations.  The entries in the Participant Register shall be conclusive absent manifest error, and such Lender shall treat each Person whose name is recorded in the Participant Register as the owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary.  For the avoidance of doubt, the Administrative Agent (in its capacity as Administrative Agent) shall have no responsibility for maintaining a Participant Register. 
(c)Any Lender (an “Assignor”) may, in accordance with applicable law and upon written notice to the Administrative Agent, at any time and from time to time assign to any 

Exhibit 10.1

Lender or any Affiliate or Related Fund of a Lender or, with the consent of the Borrower and the Administrative Agent and, in the case of any assignment of Revolving Credit Commitments, the written consent of the Issuing Lender (which shall not be unreasonably withheld or delayed) (provided that no consent from the applicable parties need be obtained by any Bank of America Entity in its capacity as Assignor (other than, solely in the case of any assignment of Revolving Credit Commitments, the consent of the Issuing Lender (which shall not be unreasonably withheld or delayed)), to an additional bank, financial institution or other entity (an “Assignee”) all or any part of its rights and obligations under this Agreement pursuant to an Assignment and Acceptance, substantially in the form of Exhibit D, executed by such Assignee and such Assignor (and, where the consent of the Borrower, the Administrative Agent or the Issuing Lender is required pursuant to the foregoing provisions, by the Borrower and such other Persons) and delivered to the Administrative Agent for its acceptance and recording in the Register; provided that, for the avoidance of doubt, Merrill Lynch, Pierce, Fenner & Smith Incorporated may, without the consent of, or notice to, the Borrower or any other Person, assign its rights and obligations under this Agreement to any other registered broker-dealer wholly-owned by any Bank of America Entity to which all or substantially all of Bank of America’s or any of its subsidiaries’ investment banking, commercial lending services or related businesses may be transferred following the date of this Agreement; provided further that with respect to assignments of Revolving Credit Commitments, no such assignment to an Assignee (other than any Lender or any Affiliate or Related Fund thereof) shall be in an aggregate principal amount of less than $5,000,000 (other than in the case of an assignment of all of a Lender’s interests under this Agreement) and, after giving effect thereto, such Assignor shall have Revolving Credit Commitments and Revolving Credit Loans aggregating at least $5,000,000 (if holding any), unless otherwise agreed by the Borrower and the Administrative Agent.  Upon such execution, delivery, acceptance and recording, from and after the effective date determined pursuant to such Assignment and Acceptance, (x) the Assignee thereunder shall be a party hereto and, to the extent provided in such Assignment and Acceptance, have the rights and obligations of a Lender hereunder with Revolving Credit Commitments and/or Loans as set forth therein, and (y) the Assignor thereunder shall, to the extent provided in such Assignment and Acceptance, be released from its obligations under this Agreement (and, in the case of an Assignment and Acceptance covering all of an Assignor’s rights and obligations under this Agreement, such Assignor shall cease to be a party hereto, except as to Section 2.15, 2.16 and 10.5 in respect of the period prior to such effective date).  Notwithstanding any provision of this Section, the consent of the Borrower shall not be required for any assignment that occurs at any time when any Event of Default shall have occurred and be continuing.  For purposes of the minimum assignment amounts and minimum hold amounts set forth in this paragraph, multiple assignments to or by two or more Related Funds shall be aggregated.
(d)No such assignment shall be made (i) to the Borrower or any of the Borrower's Affiliates or Subsidiaries or (ii) to any Defaulting Lender or any of its Subsidiaries, or any Person who, upon becoming a Lender hereunder, would constitute any of the foregoing Persons described in this clause (ii).
(e)No such assignment shall be made to a natural Person. 
(f)In connection with any assignment of rights and obligations of any Defaulting Lender hereunder, no such assignment shall be effective unless and until, in addition 

Exhibit 10.1

to the other conditions thereto set forth herein, the parties to the assignment shall make such additional payments to the Administrative Agent in an aggregate amount sufficient, upon distribution thereof as appropriate (which may be outright payment, purchases by the assignee of participations or subparticipations, or other compensating actions, including funding, with the consent of the Borrower and the Administrative Agent, the applicable pro rata share of Loans previously requested but not funded by the Defaulting Lender, to each of which the applicable assignee and assignor hereby irrevocably consent), to (x) pay and satisfy in full all payment liabilities then owed by such Defaulting Lender to the Administrative Agent or any Lender hereunder (and interest accrued thereon) and (y) acquire (and fund as appropriate) its full pro rata share of all Loans and participations in Letters of Credit in accordance with its Applicable Percentage.  Notwithstanding the foregoing, in the event that any assignment of rights and obligations of any Defaulting Lender hereunder shall become effective under applicable Law without compliance with the provisions of this paragraph, then the assignee of such interest shall be deemed to be a Defaulting Lender for all purposes of this Agreement until such compliance occurs.
(g)The Administrative Agent shall, on behalf of the Borrower, maintain at its address referred to in Section 10.2 a copy of each Assignment and Acceptance delivered to it and a register (the “Register”) for the recordation of the names and addresses of the Lenders and the Revolving Credit Commitment of, and principal amount of the Loans owing to, each Lender from time to time.  The entries in the Register shall be conclusive, in the absence of manifest error, and the Borrower, the Administrative Agent and the Lenders shall treat each Person whose name is recorded in the Register as the owner of the Loans and any Notes evidencing such Loans recorded therein for all purposes of this Agreement.  Any assignment of any Loan, whether or not evidenced by a Note, shall be effective only upon appropriate entries with respect thereto being made in the Register (and each Note shall expressly so provide).  The Register shall be available for inspection by the Borrower or any Lender (with respect to any entry relating to such Lender’s Loans) at any reasonable time and from time to time upon reasonable prior notice.
(h)Upon its receipt of an Assignment and Acceptance executed by an Assignor and an Assignee (and, in any case where the consent of any other Person is required by Section 10.6(c), by each such other Person) together with payment by the applicable Assignor or Assignee to the Administrative Agent of a registration and processing fee of $3,500 (treating multiple, simultaneous assignments by or to two or more Related Funds as a single assignment) (except that no such registration and processing fee shall be payable (y) in connection with an assignment by or to a Bank of America Entity or (z) in the case of an Assignee which is already a Lender or is an affiliate or Related Fund of a Lender or a Person under common management with a Lender), the Administrative Agent shall (i) promptly accept such Assignment and Acceptance and (ii) on the effective date determined pursuant thereto record the information contained therein in the Register and give notice of such acceptance and recordation to the Borrower.  The Borrower, at its own expense, promptly upon receipt of a request by the Administrative Agent, shall execute and deliver to the Administrative Agent (in exchange for the Revolving Credit Note of the assigning Lender) a new Revolving Credit Note to the order of such Assignee in an amount equal to the Revolving Credit Commitment assumed or acquired by it pursuant to such Assignment and Acceptance and, if the Assignor has retained a Revolving Credit Commitment, upon request, a new Revolving Credit Note to the order of the Assignor in an amount equal to the Revolving Credit Commitment retained by it hereunder.  Such new Note or 

Exhibit 10.1

Notes shall be dated the effective date of the relevant assignment and shall otherwise be in the form of the Note or Notes replaced thereby.
(i)For avoidance of doubt, the parties to this Agreement acknowledge that the provisions of this Section concerning assignments of Loans and Notes relate only to absolute assignments and that such provisions do not prohibit assignments creating security interests in Loans and Notes, including any pledge or assignment by a Lender of any Loan or Note to any Federal Reserve Bank in accordance with applicable law.
(j)Notwithstanding anything to the contrary contained herein, any Lender (a “Granting Lender”) may grant to a special purpose funding vehicle (an “SPC”), identified as such in writing from time to time by the Granting Lender to the Administrative Agent and the Borrower, the option to provide to the Borrower all or any part of any Loan that such Granting Lender would otherwise be obligated to make to the Borrower pursuant to this Agreement; provided that (i) nothing herein shall constitute a commitment by any SPC to make any Loan and (ii) if an SPC elects not to exercise such option or otherwise fails to provide all or any part of such Loan, the Granting Lender shall be obligated to make such Loan pursuant to the terms hereof.  The making of a Loan by an SPC hereunder shall utilize the Revolving Credit Commitment of the Granting Lender to the same extent, and as if, such Loan were made by such Granting Lender.  Each party hereto hereby agrees that no SPC shall be liable for any indemnity or similar payment obligation under this Agreement (all liability for which shall remain with the Granting Lender).  In furtherance of the foregoing, each party hereto hereby agrees (which agreement shall survive the termination of this Agreement) that, prior to the date that is one year and one day after the payment in full of all outstanding commercial paper or other indebtedness of any SPC, it will not institute against, or join any other person in instituting against, such SPC any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings under the laws of the United States or any state thereof.  In addition, notwithstanding anything to the contrary in this Section 10.6(g), any SPC may (A) with notice to, but without the prior written consent of, the Borrower and the Administrative Agent and without paying any processing fee therefor, assign all or a portion of its interests in any Loans to the Granting Lender, or with the prior written consent of the Borrower and the Administrative Agent (which consent shall not be unreasonably withheld) to any financial institutions providing liquidity and/or credit support to or for the account of such SPC to support the funding or maintenance of Loans, and (B) disclose on a confidential basis any non-public information relating to its Loans to any rating agency, commercial paper dealer or provider of any surety, guarantee or credit or liquidity enhancement to such SPC; provided that non-public information with respect to the Borrower may be disclosed only with the Borrower’s consent which will not be unreasonably withheld.  This paragraph (f) may not be amended without the written consent of any SPC with Loans outstanding at the time of such proposed amendment.
10.7    Adjustments; Set‐off.  (a)  Except to the extent that this Agreement provides for payments to be allocated to a particular Lender or to the Lenders under a particular Facility; and except as expressly provided herein with respect to Defaulting Lenders, if any Lender (a “Benefitted Lender”) shall at any time receive any payment of all or part of the Obligations owing to it, or receive any collateral in respect thereof (whether voluntarily or involuntarily, by set‐off, pursuant to events or proceedings of the nature referred to in Section 8(f), or otherwise), in a greater proportion than any such payment to or collateral 

Exhibit 10.1

received by any other Lender, if any, in respect of such other Lender’s Obligations, such Benefitted Lender shall purchase for cash from the other Lenders a participating interest in such portion of each such other Lender’s Obligations, or shall provide such other Lenders with the benefits of any such collateral, as shall be necessary to cause such Benefitted Lender to share the excess payment or benefits of such collateral ratably with each of the Lenders; provided, however, that if all or any portion of such excess payment or benefits is thereafter recovered from such Benefitted Lender, such purchase shall be rescinded, and the purchase price and benefits returned, to the extent of such recovery, but without interest.
(b)    Upon the occurrence and during the continuance of an Event of Default, in addition to any rights and remedies of the Lenders provided by law, each Lender, including each Issuing Lender, shall have the right, without prior notice to the Borrower, any such notice being expressly waived by the Borrower to the extent permitted by applicable law, upon any amount becoming due and payable by the Borrower hereunder (whether at the stated maturity, by acceleration or otherwise), to set off and appropriate and apply against such amount any and all deposits (general or special, time or demand, provisional or final), in any currency, and any other credits, indebtedness or claims, in any currency, in each case whether direct or indirect, absolute or contingent, matured or unmatured, at any time held or owing by such Lender or any branch, agency or Affiliate thereof to or for the credit or the account of  the Borrower.  Each Lender agrees promptly to notify the Borrower and the Administrative Agent after any such setoff and application made by such Lender; provided that the failure to give such notice shall not affect the validity of such setoff and application; provided, further, that in the event that any Defaulting Lender shall exercise any such right of setoff, (x) all amounts so set off shall be paid over immediately to the Administrative Agent for further application in accordance with the provisions of Section 2.22 and, pending such payment, shall be segregated by such Defaulting Lender from its other funds and deemed held in trust for the benefit of the Administrative Agent and the Lenders, and (y) the Defaulting Lender shall provide promptly to the Administrative Agent a statement describing in reasonable detail the Obligations owing to such Defaulting Lender as to which it exercised such right of setoff.
10.8    Counterparts.  This Agreement may be executed by one or more of the parties to this Agreement on any number of separate counterparts, and all of said counterparts taken together shall be deemed to constitute one and the same instrument.  Delivery of an executed signature page of this Agreement by facsimile or email transmission shall be effective as delivery of a manually executed counterpart hereof.  A set of the copies of this Agreement signed by all the parties shall be lodged with the Borrower and the Administrative Agent.
10.9    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 not invalidate or render unenforceable such provision in any other jurisdiction.
10.10    Integration.  This Agreement, the Fee Letters and the other Loan Documents represent the entire agreement of the Borrower, the Administrative Agent, the Joint Lead Arrangers and the Lenders with respect to the subject matter hereof and thereof, and there are no promises, undertakings, representations or warranties by any Joint Lead Arrangers, the 

Exhibit 10.1

Administrative Agent or any Lender relative to subject matter hereof not expressly set forth or referred to herein or in the other Loan Documents.
10.11    Governing Law.  THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
10.12    Submission To Jurisdiction; Waivers.  The Borrower, each Lender and the Administrative Agent hereby irrevocably and unconditionally:
(a)submits for itself and its Property in any legal action or proceeding relating to this Agreement and the other Loan Documents to which it is a party, or for recognition and enforcement of any judgment in respect thereof, to the exclusive jurisdiction of the courts of the State of New York, the courts of the United States of America for the Southern District of New York sitting in the Borough of Manhattan, and appellate courts from any thereof;
(b)consents that any such action or proceeding may be brought in such courts and waives any objection that it may now or hereafter have to the venue of any such action or proceeding in any such court or that such action or proceeding was brought in an inconvenient court and agrees not to plead or claim the same;
(c)agrees that service of process in any such action or proceeding may be effected by mailing a copy thereof by registered or certified mail (or any substantially similar form of mail), postage prepaid, to such party at its address set forth in Section 10.2 or at such other address of which the other parties hereto shall have been notified pursuant thereto;
(d)agrees that nothing herein shall affect the right to effect service of process in any other manner permitted by law or shall limit the right to sue in any other jurisdiction; and
(e)waives, to the maximum extent not prohibited by law, any right it may have to claim or recover in any legal action or proceeding referred to in this Section any special, exemplary, punitive or consequential damages.
10.13    No Fiduciary Duty.  Each Agent, each Lender and their respective Affiliates (collectively, solely for purposes of this paragraph, the “Lender Parties”), may have economic interests that conflict with those of the Borrower, its stockholders or their respective Affiliates.  The Borrower agrees that nothing in the Loan Documents will be deemed to create an advisory, fiduciary or agency relationship or fiduciary or other implied duty between any Lender Party, on the one hand, and the Borrower, its Affiliates or their respective stockholders, on the other.  The Borrower acknowledges and agrees that (a) the transactions contemplated by the Loan Documents (including the exercise of rights and remedies hereunder and thereunder) are arm’s-length commercial transactions between the Lender Parties, on the one hand, and the Borrower, on the other, and (b) in connection therewith and with the process leading thereto, (ii) no Lender Party has assumed an advisory or fiduciary responsibility in favor of the Borrower, its Affiliates or their respective stockholders, in each case, with respect to the transactions contemplated hereby (or the exercise of rights or remedies with respect thereto) or the process leading thereto (irrespective of whether any Lender has advised, is currently advising or will 

Exhibit 10.1

advise the Borrower, its stockholders or their respective Affiliates on other matters) except the obligations expressly set forth in the Loan Documents and (y) each Lender Party is acting solely as principal and not as the agent or fiduciary of the Borrower, its management, stockholders, creditors or any other Person.  The Borrower acknowledges and agrees that it has consulted its own legal and financial advisors to the extent it deemed appropriate and that it is responsible for making its own independent judgment with respect to such transactions contemplated hereby and the process leading thereto.  The Borrower agrees that it will not claim that any Lender Party has rendered advisory services of any nature or respect, or owes a fiduciary or similar duty to the Borrower, in connection with such transactions contemplated hereby or the process leading thereto.  The Borrower acknowledges no joint venture is created hereby or by the other Loan Documents or otherwise exists by virtue of the transactions contemplated hereby among the Joint Lead Arrangers, the Agents and the Lenders or among the Borrower and the Lender Parties.
10.14    Confidentiality.  The Administrative Agent and each of the Lenders agrees to keep confidential all non-public information provided or made available to it by, or on behalf of, the Borrower in connection with this Agreement and the transactions contemplated hereby; provided that nothing herein shall prevent the Administrative Agent or any Lender from disclosing any such information (a) to any Joint Lead Arrangers, the Administrative Agent, any other Lender or any Affiliate of any thereof, (b) to any Participant or Assignee (each, a “Transferee”) or prospective Transferee that agrees to comply with the provisions of this Section or substantially equivalent provisions, (c) to any of its employees, directors, agents, attorneys, accountants and other professional advisors, (d) upon the request or demand of any Governmental Authority or self-regulatory organization having jurisdiction over it, (e) in response to any order, audit, request, review or inquiry of any court or other Governmental Authority or self-regulatory organization or as may otherwise be required pursuant to any Requirement of Law, (f) in connection with any litigation or similar proceeding relating to any Obligation, this Agreement, any other Loan Document, the Indentures, or any transaction contemplated hereby or thereby, (g) that has been publicly disclosed other than in breach of this Section, (h) to any state, Federal or foreign authority or examiner (including the National Association of Insurance Commissioners or any similar organization or any nationally recognized regulatory authority) that requires access to information about a Lender’s investment portfolio in connection with ratings issued with respect to such Lender or (i) in connection with the exercise of any remedy hereunder or under any other Loan Document or (j) to market data collectors, similar service providers to the lending industry and service providers to the Administrative Agent in connection with the administration, settlement and management of this Agreement and the Loan Documents.  Notwithstanding anything to the contrary in the foregoing sentence or any other express or implied agreement, arrangement or understanding, the parties hereto hereby agree that, from the commencement of discussions with respect to the financing provided hereunder, any party hereto (and each of its employees, representatives, or agents) is permitted to disclose to any and all persons, without limitation of any kind, the tax structure and tax aspects of the transactions contemplated hereby, and all materials of any kind (including opinions or other tax analyses) related to such tax structure and tax aspects.
10.15    Accounting Changes.  In the event that any “Accounting Change” (as defined below) shall occur and such change results in a change in the method of calculation of financial covenants, standards or terms in this Agreement, then the Borrower and the Administrative Agent agree to enter into good faith negotiations in order to amend such 

Exhibit 10.1

provisions of this Agreement so as to equitably reflect such Accounting Change with the desired result that the criteria for evaluating the Borrower’s financial condition shall be the same after such Accounting Change as if such Accounting Change had not been made.  Until such time as such an amendment shall have been executed and delivered by the Borrower, the Administrative Agent and the Required Lenders, all financial covenants, standards and terms in this Agreement shall continue to be calculated or construed as if such Accounting Change had not occurred.  “Accounting Change” refers to any change in accounting principles.
10.16    WAIVERS OF JURY TRIAL.  TO THE EXTENT PERMITTED UNDER APPLICABLE LAW, THE BORROWER, THE ADMINISTRATIVE AGENT AND THE LENDERS HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.
10.17    USA PATRIOT ACT.  Each Lender that is subject to the Act (as hereinafter defined) and the Administrative Agent (for itself and not on behalf of any Lender) hereby notifies the Borrower that pursuant to the requirements of the Patriot Act, it is required to obtain, verify and record information that identifies the Borrower, which information includes the name and address of the Borrower and other information that will allow such Lender or the Administrative Agent, as applicable, to identify the Borrower in accordance with the Act.  The Borrower shall, promptly following a request by the Administrative Agent or any Lender, provide all documentation and other information that the Administrative Agent or such Lender requests in order to comply with its ongoing obligations under applicable “know your customer” and anti-money laundering rules and regulations, including the Patriot Act.
10.18    Electronic Execution of Assignments and Certain Other Documents.  The words “execution,” “signed,” “signature,” and words of like import in any document to be signed in connection with this Agreement (including without limitation assignment and assumptions, amendments or other modifications, Borrowing Notices, waivers and consents) shall be deemed to include electronic signatures or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state laws based on the Uniform Electronic Transactions Act; provided that notwithstanding anything contained herein to the contrary the Administrative Agent is under no obligation to agree to accept electronic signatures in any form or in any format unless expressly agreed to by the Administrative Agent pursuant to procedures approved by it.
10.19    Amendment and Restatement; No Novation.  This Agreement constitutes for all purposes an amendment and restatement of the Original Credit Agreement.  The Original Credit Agreement, as amended and restated hereby, continues in full force and effect as so amended and restated by this Agreement.  Nothing contained in this Agreement or any other Loan Document shall constitute or be construed as a novation of any of the Obligations.  From the Closing Date, (i) each Person signing this Agreement as an “Exiting Lender” shall cease to be a Lender hereunder and its “Revolving Credit Commitments” under the Original Credit Agreement shall be terminated, (ii) each Person signing this agreement as a “New or Continuing 

Exhibit 10.1

Lender” shall be a Lender for all purposes hereunder with the initial Revolving Credit Commitments set forth in the Commitment Appendix and (iii) each Lender’s Applicable Percentage of L/C Obligations on the Closing Date shall be recalculated giving effect to the foregoing. 
10.20    Acknowledgement and Consent to Bail-In of EEA Financial Institutions.  Solely to the extent any Lender or Issuing Lender that is an EEA Financial Institution is a party to this Agreement and notwithstanding anything to the contrary in any Loan Document or in any other agreement, arrangement or understanding among any such parties, each party hereto acknowledges that any liability of any Lender or Issuing Lender that is an EEA Financial Institution arising under any Loan Document, to the extent such liability is unsecured, may be subject to the Write-Down and Conversion Powers of an EEA Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by:
(a)the application of any Write-Down and Conversion Powers by an EEA Resolution Authority to any such liabilities arising hereunder which may be payable to it by any Lender or Issuing Lender that is an EEA Financial Institution; and
(b)the effects of any Bail-In Action on any such liability, including, if applicable:
(i)a reduction in full or in part or cancellation of any such liability;
(ii)a conversion of all, or a portion of, such liability into shares or other instruments of ownership in such EEA Financial Institution, its parent undertaking, or a bridge institution that may be issued to it or otherwise conferred on it, and that such shares or other instruments of ownership will be accepted by it in lieu of any rights with respect to any such liability under this Agreement or any other Loan Document; or
(iii)the variation of the terms of such liability in connection with the exercise of the Write-Down and Conversion Powers of any EEA Resolution Authority.
[Remainder of Page Intentionally Blank.  Signature pages Follow.]

Exhibit 10.1

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed and delivered by their proper and duly authorized officers as of the day and year first above written.
NORTHWESTERN CORPORATION,
as Borrower

By: /s/ Daniel Rausch    
Name: Daniel Rausch
Title: Treasurer

Exhibit 10.1

BANK OF AMERICA, N.A.,
as Administrative Agent

By: /s/ Gerund Diamond    
Name: Gerund Diamond
Title: Assistant Vice President

Exhibit 10.1

BANK OF AMERICA, N.A.,
as a Continuing Lender

By: /s/ Carlos Morales    
Name: Carlos Morales
Title: Senior Vice President

Exhibit 10.1

CREDIT SUISSE AG, Cayman Islands Branch
as a Continuing Lender

By: /s/ Mikhail Faybusovich    
Name: Mikhail Faybusovich
Title: Authorized Signatory

By: /s/ Lorenz Meier    
Name: Lorenz Meier
Title: Authorized Signatory

Exhibit 10.1

	
		
	Check only one of the following:

	 The undersigned is a New or Continuing Lender.

	 The undersigned is an Exiting Lender.

KEYBANK NATIONAL ASSOCIATION

	By:
	/s/ Kevin D. Smith

	Name: Kevin D. Smith
         Title: Senior Vice President 

	 

	 

Exhibit 10.1

	
		
	Check only one of the following:

	 The undersigned is a New or Continuing Lender.

	 The undersigned is an Exiting Lender.

U.S. BANK NATIONAL ASSOCIATION

	By:
	/s/ Michael E. Temnick

	Name: Michael E. Temnick
         Title: Vice President 

	 

	 

Exhibit 10.1

	
		
	Check only one of the following:

	 The undersigned is a New or Continuing Lender.

	 The undersigned is an Exiting Lender.

MUFG UNION BANK, N.A.

	By:
	/s/ Jeffrey Flagg

	Name: Jeffrey Flagg
         Title: Vice President 

	 

	 

Exhibit 10.1

	
		
	Check only one of the following:

	 The undersigned is a New or Continuing Lender.

	 The undersigned is an Exiting Lender.

ROYAL BANK OF CANADA

	By:
	/s/ Eric D. Koppelson

	Name: Eric D. Koppelson
         Title: Authorized Signatory

	 

	 

Exhibit 10.1

	
		
	Check only one of the following:

	 The undersigned is a New or Continuing Lender.

	 The undersigned is an Exiting Lender.

CANADIAN IMPERIAL BANK OF COMMERCE, NEW YORK BRANCH

	By:
	/s/ Robert Casey

	Name: Robert Casey
         Title: Authorized Signatory

	By:
	/s/ Anju Abraham

	Name: Anju Abraham
         Title: Authorized Signatory

	 

	 

Exhibit 10.1

	
		
	Check only one of the following:

	 The undersigned is a New or Continuing Lender.

	 The undersigned is an Exiting Lender.

JPMORGAN CHASE BANK, N.A.

	By:
	/s/ Nancy R. Barwig 

	Name: Nancy R. Barwig
         Title: Credit Risk Director

	 

	 

    

Exhibit 10.1

	
			
	Commitment Appendix 
	 

	Lender
	Commitment Amount
	Applicable Percentage

	Bank of America, N.A.
	$65,000,000
	16.25%

	Credit Suisse AG
	$65,000,000
	16.25%

	KeyBank National Association 
	$45,000,000.00
	11.25%

	MUFG Union Bank, N.A. 
	$45,000,000.00
	11.25%

	U.S. Bank National Association 
	$45,000,000.00
	11.25%

	Canadian Imperial Bank of Commerce, New York Branch 
	$45,000,000.00
	11.25%

	JPMorgan Chase Bank, N.A. 
	$45,000,000.00
	11.25%

	Royal Bank of Canada 
	$45,000,000.00
	11.25%

	Total
	$400,000,000
	100%

#89040102v23    

    

Exhibit 10.1

ANNEX A
PRICING GRID
	
						
	LEVEL
	Debt Rating
	Commitment Fee
	Applicable Margin
for Eurodollar Rate Loans
	Applicable Margin
for Base Rate Loans
	Letter of Credit Fee

	I
	> or equal to A / A2/A
	10.0 bps
	87.5 bps
	0 bps 
	87.5 bps

	II
	 A- / A3/A-
	12.5 bps
	112.5 bps
	12.5 bps 
	112.5 bps

	III
	 BBB+ / Baa1/ BBB+
	17.5 bps
	125.0 bps
	25.0 bps 
	125.0 bps

	IV
	BBB / Baa2/BBB
	22.5 bps
	150.0 bps
	50.0 bps
	150.0 bps

	V
	< or equal to BBB- / Baa3/BBB-
	27.5 bps
	175.0 bps
	75.0 bps
	175.0 bps

Exhibit 10.1

ANNEX B

EXISTING LETTERS OF CREDIT

None.

Exhibit 10.1

SCHEDULE 4.4

CONSENTS, AUTHORIZATIONS, FILINGS AND NOTICES

1.The Borrower is subject to Section 204 of the Federal Power Act.  The Borrower applied to the Federal Energy Regulatory Commission (the “FERC”) for authority to issue unsecured debt securities, including borrowings under its credit facility and commercial paper program up to a maximum of $450 million pursuant to its “Application of NorthWestern Corporation for Authorization Under Section 204 of the Federal Power Act to Issue Securities” dated December 28, 2015, Docket No. ES16-18-000. The FERC authorized the Borrower, pursuant to Section 204 and consistent with the foregoing application, to issue unsecured debt securities, including borrowings under its credit facility and commercial paper program in an amount not to exceed $450 million, pursuant to the FERC’s Order dated February 12, 2016, Docket No. ES16-18-000 (NorthWestern Corporation, 154 FERC ¶ 62,107 (2016).

2.The Montana Public Service Commission (“MPSC”) takes the position that its approval is required in connection with the issuance of debt by entities subject to the regulation and oversight of the MPSC. The Borrower is subject to the regulation and oversight of the MPSC in connection with its conduct of the utility business in the State of Montana, including, without limitation, with respect to the issuance of debt securities specifically relating to such business. Without conceding the Borrower’s position that the MPSC may not have jurisdiction over this financing, the Borrower filed with the MPSC its application, dated December 22, 2015, pursuant to the Montana Code Annotated §§ 69‐3‐501 through 69-3-507, seeking, among other things, authorization for the Borrower to issue unsecured debt securities in an amount not to exceed $450 million. Pursuant to the MPSC’s Default Order dated January 28, 2016, the MPSC authorized the Borrower, consistent with the foregoing application, to issue unsecured debt securities in an amount not to exceed $450 million.

Exhibit 10.1

SCHEDULE 4.6

LITIGATION

Pacific Northwest Solar, LLC vs. NorthWestern Corporation, a Delaware Corporation DBA NorthWestern Energy, Cause No. BDV 2016-929, Montana First Judicial District Court, Lewis and Clark County.
    

Exhibit 10.1

SCHEDULE 4.8

TITLE TO PROPERTY

None.

Exhibit 10.1

SCHEDULE 4.14

LIMITING REGULATIONS

See Schedule 4.4.

Exhibit 10.1

    

    
SCHEDULE 4.15

SUBSIDARIES OF THE BORROWER

	
			
	Name of Company    
	Jurisdiction of
Organization
	Percentage
Owned

	
			
	NorthWestern Services, LLC
	Delaware
	100

	Canadian-Montana Pipe Line Corporation
	Canada
	100

	Montana Generation, LLC
	Delaware
	1,001

	Clark Fork and Blackfoot, L.L.C.
	Montana
	100

	Risk Partners Assurance, Ltd.
	Bermuda
	100

	Willow Creek Gathering, LLC
	Nevada
	100

	Lodge Creek Pipelines, LLC
	Nevada
	100

	Havre Pipeline Company, LLC
	Texas
	94.99

 1    Indirect ownership.  Montana Generation, LLC is 100% owned by NorthWestern Services LLC.

Exhibit 10.1

SCHEDULE 4.16

ENVIRONMENTAL

None.

Exhibit 10.1

SCHEDULE 7.3

AFFILIATE TRANSACTIONS

		
	•
	Administrative Fee with Havre Pipeline Co., LLC for $500,400 per year.

Exhibit 10.1

SCHEDULE 7.5

NEGATIVE PLEDGES

Stipulation and Settlement Agreement dated July 8, 2004 by and among the Borrower, the Montana Public Service Commission and the Montana Consumer Counsel.

Exhibit 10.1

EXHIBIT A
FORM OF COMPLIANCE CERTIFICATE
This Compliance Certificate is delivered to you pursuant to Section 6.2(b) of the Third Amended and Restated Credit Agreement, dated as of December [12], 2016, as amended, supplemented or modified from time to time (the “Credit Agreement”), among NorthWestern Corporation d/b/a NorthWestern Energy, a Delaware corporation (the “Borrower”), the several banks and other financial institutions or entities from time to time parties thereto (the “Lenders”), and Bank of America, N.A., as administrative agent. 
I am the duly elected, qualified and acting [____________], and a Responsible Officer, of the Borrower.
I have reviewed and am familiar with the contents of this Certificate.
I have reviewed the terms of the Credit Agreement and the Loan Documents to which the Borrower is a party and have made, or caused to be made under my supervision, a review in reasonable detail of the financial condition of the Borrower and its Subsidiaries during the accounting period covered by the financial statements attached hereto as Attachment 1 (the “Financial Statements”).  Such review did not disclose the existence during or at the end of the accounting period covered by the Financial Statements, and I have no knowledge of the existence, as of the date of this Certificate, of any condition or event which constitutes a Default or Event of Default [, except as set forth below].
Attached hereto as Attachment 2 are the computations showing compliance with the covenant set forth in Section 7.1 of the Credit Agreement.
IN WITNESS WHEREOF, I execute this Certificate this _____ day of _______, 20__.
NORTHWESTERN CORPORATION

By:        
Title:
        

Exhibit 10.1

Attachment 2
to EXHIBIT A

The information described herein is as of _________, and pertains to the period from __________ __, 20__ to ____________ __, 20__.
[Set forth Covenant Calculations]
EXHIBIT B
FORM OF SECRETARY’S CERTIFICATE

December [12], 2016
Pursuant to subsection 5.1(e) of the Third Amended and Restated Credit Agreement dated as of December [12], 2016 (the “Credit Agreement”; capitalized terms not otherwise defined herein shall have the meanings given such terms in the Credit Agreement), among NorthWestern Corporation d/b/a NorthWestern Energy, a Delaware corporation (the “Borrower”), the several banks and other financial institutions or entities from time to time parties to thereto (the “Lenders”), and BANK OF AMERICA, N.A., as administrative agent, the undersigned hereby certifies that he is the duly elected and qualified Corporate Secretary of the Borrower and in such capacity further certifies as follows:
1.Attached hereto as Annex 1 is a true and complete copy of resolutions duly adopted by the Board of Directors of the Borrower on October 19, 2016, such resolutions have not in any way been amended, modified, revoked or rescinded, have been in full force and effect since their adoption to and including the date hereof and are now in full force and effect.
2.Attached hereto as Annex 2 is a true and complete copy of the By-Laws of the Borrower as in effect on the date hereof.
3.Attached hereto as Annex 3 is a true and complete copy of the Certificate of Incorporation of the Borrower as in effect on the date hereof, and such certificate has not been amended, repealed, modified or restated.
4.Attached hereto as Annex 4 are certificates of existence or similar certificates, as the case may be, from the Secretary of State or similar state official of Delaware and each other state in which the Borrower is qualified to do business.
5.Attached hereto as Annex 5 are true and complete copies of the application of the Borrower to the Federal Energy Regulatory Commission (“FERC”) and the related order issued by the FERC, which order authorizes the incurrence of Indebtedness under the Credit Agreement.
6.Attached hereto as Annex 6 are true and complete copies of the application of the Borrower to the Montana Public Service Commission (“MPSC”) and the related order issued by the MPSC, which order authorizes the incurrence of Indebtedness under the Credit Agreement.

Exhibit 10.1

7.Brian B. Bird is the duly elected and qualified Vice President, and Chief Financial Officer of the Borrower, and the signature appearing opposite his name below is his true and genuine signature.  Mr. Bird is duly authorized to execute and deliver on behalf of the Borrower each of the Loan Documents to which it is a party and any certificate or other document to be delivered by the Borrower pursuant to the Loan Documents to which it is a party.

NAME                OFFICE            SIGNATURE

Brian B. Bird            Vice President and         _____________________
Chief Financial Officer 

The undersigned has executed this Secretary’s Certificate as of the date set forth above.

__________________________________
Timothy P. Olson
Corporate Secretary

I, Brian B. Bird, Vice President and Chief Financial Officer of the Borrower, certify that Timothy P. Olson is the duly qualified Corporate Secretary of the Borrower and that the signature set forth above is his genuine signature.

__________________________________
Brian B. Bird
Vice President and Chief Financial Officer 

Exhibit 10.1

EXHIBIT C
FORM OF REVOLVING CREDIT NOTE
THIS NOTE AND THE OBLIGATIONS REPRESENTED HEREBY MAY NOT BE TRANSFERRED EXCEPT IN COMPLIANCE WITH THE TERMS AND PROVISIONS OF THE CREDIT AGREEMENT REFERRED TO BELOW.  TRANSFERS OF THIS NOTE AND THE OBLIGATIONS REPRESENTED HEREBY MUST BE RECORDED IN THE REGISTER MAINTAINED BY THE ADMINISTRATIVE AGENT PURSUANT TO THE TERMS OF SUCH CREDIT AGREEMENT.
$____________                                    New York, New York
[DATE]
FOR VALUE RECEIVED, the undersigned, NORTHWESTERN CORPORATION d/b/a NORTHWESTERN ENERGY, a Delaware corporation (the “Borrower”), hereby promises to pay to ___________________ (the “Lender”) or its registered assigns at the Payment Office specified in the Credit Agreement (as hereinafter defined) in lawful money of the United States and in immediately available funds, on the Revolving Credit Termination Date the principal amount of (a) _________ DOLLARS ($______), or, if less, (b) the aggregate unpaid principal amount of all Revolving Credit Loans made by the Lender to the Borrower pursuant to Section 2.1 of the Credit Agreement.  The Borrower further agrees to pay interest in like money at such Payment Office on the unpaid principal amount hereof from time to time outstanding at the rates and on the dates specified in Section 2.11 of the Credit Agreement.
The holder of this Note is authorized to endorse on the schedules annexed hereto and made a part hereof or on a continuation thereof which shall be attached hereto and made a part hereof the date, Type and amount of each Revolving Credit Loan made pursuant to the Credit Agreement and the date and amount of each payment or prepayment of principal thereof, each continuation thereof, each conversion of all or a portion thereof to another Type and, in the case of Eurodollar Loans, the length of each Interest Period with respect thereto.  The failure to make any such endorsement or any error in any such endorsement shall not affect the obligations of the Borrower in respect of any Revolving Credit Loan.
This Note (a) is one of the Revolving Credit Notes referred to in the Third Amended and Restated Credit Agreement dated as of December [12], 2016 (as amended, supplemented or otherwise modified from time to time, the “Credit Agreement”), among the Borrower, the Lender, the other banks and financial institutions or entities from time to time parties thereto, and Bank of America, N.A., as administrative agent, (b) is subject to the provisions of the Credit Agreement and (c) is subject to optional prepayment in whole or in part as provided in the Credit Agreement.
Upon the occurrence of any one or more of the Events of Default, all principal and all accrued interest then remaining unpaid on this Note shall become, or may be declared to be, immediately due and payable, all as and to the extent provided in the Credit Agreement.
All parties now and hereafter liable with respect to this Note, whether maker, principal, surety, guarantor, endorser or otherwise, hereby waive presentment, demand, protest and all other notices of any kind.
Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement.

Exhibit 10.1

NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED HEREIN OR IN THE CREDIT AGREEMENT, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT PURSUANT TO AND IN ACCORDANCE WITH THE REGISTRATION AND OTHER PROVISIONS OF SECTION 10.6 OF THE CREDIT AGREEMENT.
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK WITHOUT REGARD TO THE PRINCIPLES OF CONFLICT OF LAWS THEREOF OTHER THAN SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK.
NORTHWESTERN CORPORATION

By:        
Name:
Title:

Exhibit 10.1

Schedule A
to Revolving Credit Note
LOANS, CONVERSIONS AND REPAYMENTS OF BASE RATE LOANS
	
							
	Date
	

Amount of Base Rate
Loans
	Amount
Converted to
Base Rate Loans
	

Amount of Principal of
Base Rate Loans Repaid
	Amount of Base Rate
Loans Converted to
Eurodollar Loans
	

Unpaid Principal Balance
of Base Rate Loans
	Notation Made By

	 
	 
	 
	 
	 
	 
	 

	 
	 
	 
	 
	 
	 
	 

	 
	 
	 
	 
	 
	 
	 

	 
	 
	 
	 
	 
	 
	 

	 
	 
	 
	 
	 
	 
	 

	 
	 
	 
	 
	 
	 
	 

	 
	 
	 
	 
	 
	 
	 

	 
	 
	 
	 
	 
	 
	 

	 
	 
	 
	 
	 
	 
	 

	 
	 
	 
	 
	 
	 
	 

Exhibit 10.1

Schedule B
to Revolving Credit Note
LOANS, CONTINUATIONS, CONVERSIONS AND REPAYMENTS OF EURODOLLAR LOANS
	
								
	Date
	

Amount of
Eurodollar Loans
	Amount Converted
to Eurodollar
Loans
	Interest Period and
Eurodollar Rate with
Respect Thereto
	Amount of Principal
of Eurodollar Loans
Repaid
	Amount of Eurodollar
Loans Converted to
Base Rate Loans
	Unpaid Principal
Balance of
Eurodollar Loans
	

Notation
Made By

	 
	 
	 
	 
	 
	 
	 
	 

	 
	 
	 
	 
	 
	 
	 
	 

	 
	 
	 
	 
	 
	 
	 
	 

	 
	 
	 
	 
	 
	 
	 
	 

	 
	 
	 
	 
	 
	 
	 
	 

	 
	 
	 
	 
	 
	 
	 
	 

	 
	 
	 
	 
	 
	 
	 
	 

	 
	 
	 
	 
	 
	 
	 
	 

	 
	 
	 
	 
	 
	 
	 
	 

	 
	 
	 
	 
	 
	 
	 
	 

Exhibit 10.1

EXHIBIT D

ASSIGNMENT AND ACCEPTANCE

This Assignment and Acceptance (the “Assignment and Assumption”) is dated as of the Effective Date set forth below and is entered into by and between [Insert name of Assignor] (the “Assignor”) and [Insert name of Assignee] (the “Assignee”).  Capitalized terms used but not defined herein shall have the meanings given to them in the Credit Agreement identified below (as amended, the “Credit Agreement”), receipt of a copy of which is hereby acknowledged by the Assignee.  The Standard Terms and Conditions set forth in Annex 1 attached hereto are hereby agreed to and incorporated herein by reference and made a part of this Assignment and Assumption as if set forth herein in full.
For an agreed consideration, the Assignor hereby irrevocably sells and assigns to the Assignee, and the Assignee hereby irrevocably purchases and assumes from the Assignor, subject to and in accordance with the Standard Terms and Conditions and the Credit Agreement, as of the Effective Date inserted by Administrative Agent as contemplated below (i) all of the Assignor’s rights and obligations in its capacity as a Lender under the Credit Agreement and any other documents or instruments delivered pursuant thereto to the extent related to the amount and percentage interest identified below of all of such outstanding rights and obligations of the Assignor under the facility identified below (including any letters of credit and guarantees included in the facility) and (ii) to the extent permitted to be assigned under applicable law, all claims, suits, causes of action and any other right of the Assignor (in its capacity as a Lender) against any Person, whether known or unknown, arising under or in connection with the Credit Agreement, any other documents or instruments delivered pursuant thereto or the loan transactions governed thereby or in any way based on or related to any of the foregoing, including contract claims, tort claims, malpractice claims, statutory claims and all other claims at law or in equity related to the rights and obligations sold and assigned pursuant to clause (i) above (the rights and obligations sold and assigned pursuant to clauses (i) and (ii) above being referred to herein collectively as the “Assigned Interest”).  Such sale and assignment is without recourse to the Assignor and, except as expressly provided in this Assignment and Assumption, without representation or warranty by the Assignor.
1.    Assignor:        ______________________________
2.          Assignee:                        ______________________________
[and is an Affiliate/Related Fund of [identify Lender] Select as applicable.]
		
	3.
	Borrower:        NorthWestern Corporation d/b/a NorthWestern Energy

		
	4.
	Administrative Agent:    Bank of America, N.A., as Administrative Agent under the Credit Agreement

		
	5.
	Credit Agreement:    Third Amended and Restated Credit Agreement dated as of December [12], 2016 among NorthWestern Corporation d/b/a NorthWestern Energy, as Borrower, the Lenders party thereto, and Bank of America, N.A., as Administrative Agent

6.           Assigned Interest:
	
				
	Aggregate Amount of Commitment/Loans for all Lenders
	Amount of Commitment/Loans Assigned
	Percentage 
Assigned of Commitment/Loans Set forth, to at least 9 decimals, as a percentage of the Commitment/Loans of all Lenders thereunder.
	CUSIP Number

	$
	$
	%
	 

	$
	$
	%
	 

	$
	$
	%
	 

Exhibit 10.1

Effective Date:  _____________ ___, 201_ [TO BE INSERTED BY ADMINISTRATIVE AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER THEREFOR.]
The terms set forth in this Assignment and Assumption are hereby agreed to:

	
		
	ASSIGNOR
[NAME OF ASSIGNOR]

	By:
	 

	 
	Name:

	 
	Title:

	
		
	ASSIGNEE
[NAME OF ASSIGNEE]

	By:
	 

	 
	Name:

	 
	Title:

Consented to and Accepted:

	
		
	BANK OF AMERICA, N.A., as Administrative Agent

	By:
	 

	 
	Name:

	 
	Title:

	
		
	 

	By:
	 

	 
	Name:

	 
	Title:

	
		
	NORTHWESTERN CORPORATION

	By:
	 

	 
	Name:

	 
	Title:

Exhibit 10.1

EXHIBIT E

ANNEX 1
STANDARD TERMS AND CONDITIONS FOR
ASSIGNMENT AND ASSUMPTION

1.  Representations and Warranties.  
1.1  Assignor.  The Assignor (a) represents and warrants that (i) it is the legal and beneficial owner of the Assigned Interest, (ii) it has not created any lien, encumbrance or other adverse claim upon the Assigned Interest and the Assigned Interest is free and clear of any such lien, encumbrance or other adverse claim, (iii) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Assumption and to consummate the transactions contemplated hereby and (iv) it is not a Defaulting Lender; and (b) assumes no responsibility with respect to (i) any statements, warranties or representations made in or in connection with the Credit Agreement or any other Loan Document, (ii) the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Credit Agreement or any other Loan Document, (iii) the financial condition of Borrower, any of its Subsidiaries or Affiliates or any other Person obligated in respect of the Credit Agreement or any other Loan Document or (iv) the performance or observance by Borrower, any of its Subsidiaries or Affiliates or any other Person of any of their respective obligations under the Credit Agreement or any other Loan Document. 
1.2.  Assignee.  The Assignee (a) represents and warrants that (i) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Assumption and to consummate the transactions contemplated hereby and to become a Lender under the Credit Agreement or any other Loan Document, (ii) it satisfies the requirements, if any, specified in the Credit Agreement or any other Loan Document that are required to be satisfied by it in order to acquire the Assigned Interest and become a Lender, (iii) from and after the Effective Date, it shall be bound by the provisions of the Credit Agreement or any other Loan Document as a Lender thereunder and, to the extent of the Assigned Interest, shall have the obligations of a Lender thereunder, (iv) it has received a copy of the Credit Agreement or any other Loan Document, together with copies of the most recent financial statements delivered pursuant to Section 6.1 thereof, as applicable, and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Assignment and Assumption and to purchase the Assigned Interest on the basis of which it has made such analysis and decision independently and without reliance on Administrative Agent or any other Lender, and (v) if it is a Lender not formed under the laws of the United States of America or any state thereof, attached to the Assignment and Assumption is any documentation required to be delivered by it pursuant to the terms of the Credit Agreement or any other Loan Document, duly completed and executed by the Assignee; and (b) agrees that (i) it will, independently and without reliance on Administrative Agent, the Assignor or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Credit Agreement or any other Loan Document, and (ii) it will perform in accordance with their terms all of the obligations which by the terms of the Credit Agreement or any other Loan Document are required to be performed by it as a Lender.
2.  Payments.  From and after the Effective Date, Administrative Agent shall make all payments in respect of the Assigned Interest (including payments of principal, interest, fees and other amounts) to the Assignor for amounts which have accrued up to but excluding the Effective Date and to the Assignee for amounts which have accrued from and after the Effective Date.
3.  General Provisions.  This Assignment and Assumption shall be binding upon, and inure to the benefit of, the parties hereto and their respective successors and assigns.  This Assignment and Assumption may be executed in any number of counterparts, which together shall constitute one instrument.  Delivery of an executed counterpart of a signature page of this Assignment and Assumption by telecopy shall be effective as delivery of a manually executed counterpart of this Assignment and Assumption.  This Assignment and Assumption shall be governed by, and construed in accordance with, the law of the State of New York.

Exhibit 10.1

Exhibit E
FORM OF EXEMPTION CERTIFICATE
(For Non-U.S. Lenders That Are Not Partnerships For U.S. Federal Income Tax Purposes)
Reference is made to the Third Amended and Restated Credit Agreement, dated as of December [12], 2016 (as amended, supplemented or otherwise modified from time to time, the “Credit Agreement”) among NorthWestern Corporation d/b/a NorthWestern Energy, a Delaware corporation (the “Borrower”), the several banks and other financial institutions or entities from time to time parties thereto (the “Lenders”), and Bank of America, N.A., as administrative agent.  Capitalized terms used herein that are not defined herein shall have the meanings ascribed to them in the Credit Agreement.  _______________________ (the “Non-U.S. Lender”) is providing this certificate pursuant to subsection 2.16(d) of the Credit Agreement.  
The Non-U.S. Lender hereby represents and warrants that:
The Non-U.S. Lender is the sole record and beneficial owner of the Loans or the obligations evidenced by Note(s) in respect of which it is providing this certificate.
The Non-U.S. Lender is not a “bank” for purposes of Section 881(c)(3)(A) of the Internal Revenue Code of 1986, as amended (the “Code”).  In this regard, the Non-U.S. Lender further represents and warrants that:
the Non-U.S. Lender is not subject to regulatory or other legal requirements as a bank in any jurisdiction; and
the Non-U.S. Lender has not been treated as a bank for purposes of any tax, securities law or other filing or submission made to any Governmental Authority, any application made to a rating agency or qualification for any exemption from tax, securities law or other legal requirements.
The Non-U.S. Lender is not a 10-percent shareholder of the Borrower within the meaning of Section 881(c)(3)(B) of the Code; and
The Non-U.S. Lender is not a controlled foreign corporation receiving interest from a related person within the meaning of Section 881(c)(3)(C) of the Code.
The undersigned has furnished the administrative agent and the Borrower with a certificate of its non-U.S. Person status on IRS Form W-8BEN or IRS Form W-8BEN-E.  By executing this certificate, the undersigned agrees that (1) if the information provided on this certificate changes, the undersigned shall promptly so inform the Borrower and the Administrative Agent, and (2) the undersigned shall have at all times furnished the Borrower and the Administrative Agent with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two calendar years preceding such payments.
IN WITNESS WHEREOF, the undersigned has duly executed this certificate.

Exhibit 10.1

[NAME OF NON-U.S. LENDER]

By:        
Name:
Title:
Date: 

Exhibit 10.1

FORM OF EXEMPTION CERTIFICATE

(For Non-U.S. Participants That Are Not Partnerships For U.S. Federal Income Tax Purposes)

Reference is made to the Third Amended and Restated Credit Agreement, dated as of December [12], 2016 (as amended, supplemented or otherwise modified from time to time, the “Credit Agreement”) among NorthWestern Corporation d/b/a NorthWestern Energy, a Delaware corporation (the “Borrower”), the several banks and other financial institutions or entities from time to time parties thereto (the “Lenders”), and Bank of America, N.A., as administrative agent.  Capitalized terms used herein that are not defined herein shall have the meanings ascribed to them in the Credit Agreement.  _______________________ (the “Non-U.S. Participant”) is providing this certificate pursuant to subsection 2.16(d) of the Credit Agreement.  
The Non-U.S. Participant hereby represents and warrants that:
The Non-U.S. Participant is the sole record and beneficial owner of the participating interest(s) in respect of which it is providing this certificate.
The Non-U.S. Participant is not a “bank” for purposes of Section 881(c)(3)(A) of the Internal Revenue Code of 1986, as amended (the “Code”).  In this regard, the Non-U.S. Participant further represents and warrants that:
the Non-U.S. Participant is not subject to regulatory or other legal requirements as a bank in any jurisdiction; and 
the Non-U.S. Participant has not been treated as a bank for purposes of any tax, securities law or other filing or submission made to any Governmental Authority, any application made to a rating agency or qualification for any exemption from tax, securities law or other legal requirements.
The Non-U.S. Participant is not a 10-percent shareholder of the Borrower within the meaning of Section 881(c)(3)(B) of the Code; and
The Non-U.S. Participant is not a controlled foreign corporation receiving interest from a related person within the meaning of Section 881(c)(3)(C) of the Code.
The undersigned has furnished its participating Lender with a certificate of its non-U.S. Person status on IRS Form W-8BEN or IRS Form W-8BEN-E.  By executing this certificate, the undersigned agrees that (1) if the information provided on this certificate changes, the undersigned shall promptly so inform its participating Lender in writing, and (2) the undersigned shall have at all times furnished its participating Lender with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two calendar years preceding such payments.

IN WITNESS WHEREOF, the undersigned has duly executed this certificate.

Exhibit 10.1

[NAME OF NON-U.S. PARTICIPANT]

By:        
Name:
Title:
Date: 

Exhibit 10.1

FORM OF EXEMPTION CERTIFICATE

(For Non-U.S. Lenders That Are Partnerships For U.S. Federal Income Tax Purposes)

Reference is made to the Third Amended and Restated Credit Agreement, dated as of December [12], 2016 (as amended, supplemented or otherwise modified from time to time, the “Credit Agreement”) among NorthWestern Corporation d/b/a NorthWestern Energy, a Delaware corporation (the “Borrower”), the several banks and other financial institutions or entities from time to time parties thereto (the “Lenders”), and Bank of America, N.A., as administrative agent.  Capitalized terms used herein that are not defined herein shall have the meanings ascribed to them in the Credit Agreement.  _______________________ (the “Non-U.S. Lender”) is providing this certificate pursuant to subsection 2.16(d) of the Credit Agreement.  
The Non-U.S. Lender hereby represents and warrants that:
The Non-U.S. Lender is the sole record owner of, and its direct or indirect partners/members are the beneficial owners of, the Loans or the obligations evidenced by Note(s)  in respect of which it is providing this certificate.
Neither the Non-U.S. Lender nor any of its direct or indirect partners/members is a “bank” for purposes of Section 881(c)(3)(A) of the Internal Revenue Code of 1986, as amended (the “Code”).  In this regard, the Non-U.S. Lender further represents and warrants that:
neither the Non-U.S. Lender nor any of its direct or indirect partners/members are subject to regulatory or other legal requirements as a bank in any jurisdiction; and 
neither the Non-U.S. Lender nor any of its direct or indirect partners/members have been treated as a bank for purposes of any tax, securities law or other filing or submission made to any Governmental Authority, any application made to a rating agency or qualification for any exemption from tax, securities law or other legal requirements.
Neither the Non-U.S. Lender nor any of its direct or indirect partners/members is a 10-percent shareholder of the Borrower within the meaning of Section 881(c)(3)(B) of the Code; and
Neither the Non-U.S. Lender nor any of its direct or indirect partners/members is a controlled foreign corporation receiving interest from a related person within the meaning of Section 881(c)(3)(C) of the Code.
The undersigned has furnished the administrative agent and the Borrower with IRS Form W-8IMY accompanied by one of the following forms from each of its partners/members that is claiming the portfolio interest exemption: (i) an IRS Form W-8BEN or IRS Form W-8BEN-E or (ii) an IRS Form W-8IMY accompanied by an IRS Form W-8BEN or IRS Form W-8BEN-E from each of such partner’s/member’s beneficial owners that is claiming the portfolio interest exemption.  By executing this certificate, the undersigned agrees that (1) if the information provided on this certificate changes, the undersigned shall promptly so inform the Borrower and the Administrative Agent, and (2) the undersigned shall have at all times furnished the Borrower and the Administrative Agent with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two calendar years preceding such payments.

IN WITNESS WHEREOF, the undersigned has duly executed this certificate.

Exhibit 10.1

[NAME OF NON-U.S. LENDER]

By:        
Name:
Title:
Date: 

Exhibit 10.1

FORM OF EXEMPTION CERTIFICATE

(For Non-U.S. Participants That Are Partnerships For U.S. Federal Income Tax Purposes)

Reference is made to the Third Amended and Restated Credit Agreement, dated as of December [12], 2016 (as amended, supplemented or otherwise modified from time to time, the “Credit Agreement”) among NorthWestern Corporation d/b/a NorthWestern Energy, a Delaware corporation (the “Borrower”), the several banks and other financial institutions or entities from time to time parties thereto (the “Lenders”), and Bank of America, N.A., as administrative agent.  Capitalized terms used herein that are not defined herein shall have the meanings ascribed to them in the Credit Agreement.  _______________________ (the “Non-U.S. Participant”) is providing this certificate pursuant to subsection 2.16(d) of the Credit Agreement.  
The Non-U.S. Participant hereby represents and warrants that:
The Non-U.S. Participant is the sole record owner of, and its direct or indirect partners/members are the beneficial owners of, the participation interests in respect of which it is providing this certificate.
Neither the Non-U.S. Participant nor any of its direct or indirect partners/members is a “bank” for purposes of Section 881(c)(3)(A) of the Internal Revenue Code of 1986, as amended (the “Code”).  In this regard, the Non-U.S. Lender further represents and warrants that:
neither the Non-U.S. Participant nor any of its direct or indirect partners/members are subject to regulatory or other legal requirements as a bank in any jurisdiction; and 
neither the Non-U.S. Participant nor any of its direct or indirect partners/members have been treated as a bank for purposes of any tax, securities law or other filing or submission made to any Governmental Authority, any application made to a rating agency or qualification for any exemption from tax, securities law or other legal requirements.
Neither the Non-U.S. Participant nor any of its direct or indirect partners/members is a 10-percent shareholder of the Borrower within the meaning of Section 881(c)(3)(B) of the Code; and
Neither the Non-U.S. Participant nor any of its direct or indirect partners/members is a controlled foreign corporation receiving interest from a related person within the meaning of Section 881(c)(3)(C) of the Code.
The undersigned has furnished its participating Lender with IRS Form W-8IMY accompanied by one of the following forms from each of its partners/members that is claiming the portfolio interest exemption: (i) an IRS Form W-8BEN or IRS Form W-8BEN-E or (ii) an IRS Form W-8IMY accompanied by an IRS Form W-8BEN or IRS Form W-8BEN-E from each of such partner’s/member’s beneficial owners that is claiming the portfolio interest exemption.  By executing this certificate, the undersigned agrees that (1) if the information provided on this certificate changes, the undersigned shall promptly so inform its participating Lender, and (2) the undersigned shall have at all times furnished its participating Lender with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two calendar years preceding such payments.

IN WITNESS WHEREOF, the undersigned has duly executed this certificate.

Exhibit 10.1

[NAME OF NON-U.S. PARTICIPANT]

By:        
Name:
Title:

Date: 

Exhibit 10.1

EXHIBIT F
FORM OF BORROWING NOTICE
Date:  ___________, _____
To:    Bank of America, N.A., as Administrative Agent
Ladies and Gentlemen:
Reference is made to that certain Third Amended and Restated Credit Agreement, dated as of December [12], 2016 (as amended, restated, extended, supplemented or otherwise modified in writing from time to time, the “Agreement;” the terms defined therein being used herein as therein defined), among NorthWestern Corporation d/b/a NorthWestern Energy, a Delaware corporation (the “Borrower”), the Lenders from time to time party thereto, and Bank of America, N.A., as Administrative Agent.
The undersigned hereby requests (select one):
  A Borrowing of Revolving Credit Loans
  A conversion or continuation of Revolving Credit
		
	1.
	On                     (a Business Day).

		
	2.
	In the amount of $                

		
	3.
	Comprised of                         

[Type of Loan requested]
		
	4.
	Wire instructions for Borrower’s account: ______________

		
	5.
	For Eurodollar Rate Loans:  with an Interest Period of      [months][weeks].

The Revolving Credit Borrowing requested herein complies with Section 2.2 of the Agreement.

The Borrower hereby represents and warrants that the conditions specified in Section 5.2 shall be satisfied on and as of the date of the Borrowing Date.
NORTHWESTERN CORPORATION
as the Borrower

By:      
Name:      
Title:                      

Exhibit 10.1

EXHIBIT G
FORM OF LETTER OF CREDIT REQUEST

Dated           Date of Letter of Credit Request which will be on or after the Initial Borrowing Date and prior to the 7th Business Day prior to the Revolving Credit Termination Date.     

Bank of America N.A., as Administrative Agent
under the Third Amended and Restated Credit Agreement (as amended, supplemented or modified for time to time, the “Credit Agreement”) dated as of December [12], 2016 among Northwestern Corporation (the “Borrower”) and d/b/a NorthWestern Energy.
135 South LaSalle Street
IL4-135-09-61
Chicago, IL 60603
[Name and Address of applicable Issuing Lender]     If Bank of America is the Issuing Lender insert the following name and address: Bank of America, N.A., Trade Operations, Mail Code: PA6-580-02-30, 1 Fleet Way, Scranton, PA 18507, Phone: 570-496-9619, Facscimile: 800-755-8740, Email: tradeclientserviceteamus@baml.com, Attention: Alfonso Malave, Phone: 570-496-9622, Facsimile: 800-755-8743, Email: alfonso.malave@baml.com
Dear Ladies and Gentlemen: 
We hereby request that the Issuing Lender, in its individual capacity, issue a standby Letter of Credit for the account of the undersigned on           Date of Issuance which shall be at least four (4) Business Days from the date hereof (or such shorter period as is reasonably acceptable to the respective Issuing Lender).         (the “Date of Issuance”), which Letter of Credit shall be denominated in United States Dollars and shall be in the aggregate amount of           Aggregate initial amount of the Letter of Credit.      . 
For the purposes of this Letter of Credit Request, unless otherwise defined herein, all capitalized terms used herein and defined in the Credit Agreement shall have the respective meaning provided such terms in the Credit Agreement. 
The beneficiary of the requested Letter of Credit will be           Insert name and address of beneficiary.      , and such Letter of Credit will be in support of           Insert brief description of the L/C Supportable Obligations.       and will have a stated expiration date of           Insert the last date upon which drafts may be presented which may not be later than the earlier of (x) the first anniversary of the date of issuance and (y) the date which is five Business Days prior to the Revolving Credit Termination Date.      . We hereby certify that: 
(1)    Each of the representations and warranties made by the Borrower in or pursuant to the Loan Documents to which it is a party other than those in Sections 4.2 and 4.6 of the Credit Agreement (except to the extent applicable to an earlier date) is true and correct in all material respects on and as of the date hereof as if made on and as of the date hereof; and

Exhibit 10.1

(2)    No Default or Event of Default has occurred and is continuing nor, after giving effect to the issuance of the Letter of Credit requested hereby, would such a Default or an Event of Default occur.  

NORTHWESTERN CORPORATION

By    ___________________________
Name:
Title:

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