Document:

Exhibit 10.24

 

		
	

	
Form of Notice to Guarantor

Notice To Guarantor

	

	
You are being asked to guarantee the debt described in the guaranty instrument below, including all future debts of the borrower entered into with the creditor.  Think carefully before you do. If Borrower doesn’t pay the debt, you will have to. Be sure you can afford to pay if you have to, and that you want to accept this responsibility.

	

	
You may have to pay up to the full amount of the debt, including all interest, if Borrower does not pay. You may also have to pay late fees and reasonable collection costs, which increase this amount.

	

	
The Bank can collect this debt from you without first trying to collect from Borrower. The Bank can use the same collection methods against you that can be used against Borrower, such as suing you, garnishing your wages, etc. If this debt is ever in default, that fact may become a part of your credit record.

	

	
This notice is not the contract that makes you liable for the debt.

I certify that I read and understood the notice above before signing the attached guaranty instrument.

 

	
(Entity Name)
	
 
	
 

	
 
	
 
	
 
	
 
	
 

	
By:
	
(Entity Name)
	
 
	
 

 

	
 
	
By:
	
(Entity Name)
	
 
	
 

	
 
	
 
	
(State of Incorporation)
	
 
	
 

 

	
 
	
 
	
By: 
	
 \s\ Dirk A. Montgomery
	
 
	
 
	
December 15, 2014

	
 
	
 
	
 
	
Dirk A. Montgomery,
	
 
	
 
	
 

	
 
	
 
	
 
	
Executive Vice President and
	
 
	
 
	
 

	
 
	
 
	
 
	
Chief Financial Officer
	
 
	
 
	
 

		

			
	
{29820939;1}630071 (11/13) Attorney Prepared
	
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Form of Unconditional Guaranty

This guaranty of __________________________ (“Guarantor”) dated December 15, 2014, provides:

Whereas ________________ (herein, whether one or more, the “Borrower”), desires to transact business with and to obtain credit or a continuation of credit from SunTrust Bank, its present and future affiliates and their successors and assigns (collectively, “SunTrust”); and

Whereas, SunTrust is unwilling to extend or continue credit to Borrower unless it receives a guaranty from the undersigned Guarantor with respect to the Obligations, as defined below, of Borrower to SunTrust;

Now, Therefore, in consideration of the premises and of other good and valuable consideration and in order to induce SunTrust from time to time, in its sole discretion, to extend or continue credit to or enter into other transactions with Borrower, Guarantor absolutely and unconditionally guarantees to SunTrust performance and payment when due, whether by acceleration or otherwise, of any and all Obligations of Borrower to SunTrust, together with all interest and charges related thereto, and reasonable attorneys’ fees, reasonable costs and reasonable expenses of collection incurred by SunTrust in enforcing the Obligations or this guaranty, subject to the provisions contained herein.

	
1.
	
The term “Obligations” or “Obligation” as used herein shall include, without limitation, any and all liabilities, obligations, agreements and undertakings of Borrower to SunTrust in any amount, whether now existing or hereafter arising (including those owed by Borrower to others and acquired by SunTrust through purchase, assignment or otherwise), however created, evidenced or arising, whether individually or jointly with others, and whether absolute or contingent, direct or indirect, as maker, endorser, guarantor, surety or otherwise, liquidated or unliquidated, matured or unmatured, whether or not secured by collateral, and including, without limitation, (a) all obligations to perform or forbear from performing any acts, (b) all overdrafts on deposits or accounts maintained by Borrower with SunTrust, (c) all liabilities, obligations, agreements and undertakings of Borrower  to SunTrust pursuant to any interest rate hedge agreement or other derivative transaction agreement or any foreign exchange contract or any application or other agreement requesting SunTrust to issue any letter of credit including, without limitation, the obligation of Borrower to reimburse SunTrust for all amounts funded by SunTrust pursuant to any such letter of credit (d) all obligations and other liabilities of Borrower  to SunTrust  in respect of any of the following services (i) any treasury or other cash management services, including, without limitation, automated clearing house (ACH) origination and other funds transfer, depository (including, without limitation,  cash vault and check deposit),  zero balance account and sweep,  returned items processing,  controlled disbursement, positive pay, lockbox,  account reconciliation and information reporting,  payables outsourcing, payroll processing, and  trade finance services, and (ii) card services, including, without limitation,  credit card (including, without limitation, purchasing card and commercial card), prepaid card (including, without limitation,  payroll, stored value and gift cards), merchant services processing, and debit card services and (e) all reasonable costs of collection and protection of SunTrust’s rights, including attorneys’ fees allowed by law (in the amount of 15% of the principal and interest secured hereby if guaranty is governed by the laws of Georgia), whether such collection or protection occurs prior to, during, or after any bankruptcy proceedings filed by or against Borrower; provided, however, that “Obligations” will not include any Excluded Swap Obligation (as hereinafter defined). “Excluded Swap Obligation” means any Swap Obligation (as hereinafter defined), if and to the extent that all or any portion of this guaranty of such Swap Obligation is or becomes illegal under the Commodity Exchange Act (7 U.S.C. §1 et seq.) (as amended and, together with any successor statute, the “Commodity Exchange Act”), or any rule, regulation or order of the Commodities Futures Trading Commission (or the application or official interpretation of any thereof), by virtue of Guarantor’s failure for any reason to constitute an “eligible contract participant” as defined in the Commodity Exchange Act and the regulations thereunder at the time that this guaranty becomes effective with respect to such Swap Obligation.  If a Swap Obligation arises under a master agreement governing more than one swap, the exclusion of such Swap Obligation under this guaranty shall apply only to the portion of such Swap Obligation that is attributable to swaps for which this guaranty is or becomes illegal. For purposes hereof, the term “Swap Obligation” means any obligation to pay or perform under any agreement, contract or transaction that constitutes a “swap” within the meaning of section 1a(47) of the Commodity Exchange Act.   

	
2.
	
This guaranty is a continuing guaranty, shall remain in force irrespective of any interruptions in the business relations of Borrower with SunTrust and shall apply to and guarantee any balance which shall remain due by Borrower to SunTrust; provided, however, that Guarantor may, by written notice delivered personally to an officer of SunTrust or received by registered mail by an officer of SunTrust, terminate this guaranty with respect to all Obligations of the Borrower incurred or contracted by the Borrower or acquired by SunTrust after the date on which the notice is actually received by such officer. Such termination shall not be applicable to any Obligation incurred prior to the receipt of such notice by SunTrust.

			
	
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3. 
	
SunTrust may at any time and from time to time, in the exercise of its sole discretion, either before or after default by Borrower or revocation or termination of this guaranty, without the consent of or notice to Guarantor, and without incurring responsibility to Guarantor, or releasing or impairing the liability of Guarantor, or any security available to SunTrust, upon or without any terms or conditions:

	
a.
	
Change the manner, place, or terms of payment (including payment amounts and rate of interest) and/or change or extend the time of payment, renew or alter any Obligation, any collateral or security therefore, or any Obligation incurred directly or indirectly in respect thereof, and this guaranty shall apply to the Obligations as so changed, extended, renewed or altered;

	
b.
	
Sell, exchange, release, surrender, realize upon or otherwise deal with in any manner and in any order any collateral or security at any time held by or available to SunTrust for any Obligation, or for any obligations of Guarantor or any person secondarily or otherwise liable for any of the Obligations; SunTrust shall have full authority to adjust, compromise and receive less than the amount due upon any such collateral;

	
c.
	
Exercise or refrain from exercising any rights against Borrower, Guarantor or others, or otherwise act or refrain from acting;

	
d.
	
Release, compromise, or agree not to sue, in whole or in part, Borrower, Guarantor or any other party obligated on any of the Obligations;

	
e.
	
Apply any sums received by it from any source to any Obligation or Obligations, in such order as payments are applied under any promissory note outstanding from Borrower to Bank. All payments shall be conclusively presumed to have been made by Borrower and no payment shall operate to reduce the obligation of a Guarantor unless, at the time such payments are made, written notice is delivered to an officer of SunTrust that such payments are made by a Guarantor in reduction of Guarantor’s liability hereunder, and such payments are actually made by Guarantor; and

	
f.
	
Fail to set off and release, in whole or in part, any balance of any deposit account or credit on its books in favor of Borrower, or any other person liable for any of the Obligations, and may extend further credit in any manner to Borrower, and generally deal with Borrower or any security or other person liable for any of the Obligations as SunTrust, in its sole discretion, may see fit.

	
4.
	
As security for the payment of the Obligations and the obligation of Guarantor hereunder, Guarantor hereby assigns and grants a security interest to SunTrust in (a) all property of Guarantor in or coming into the possession, control or custody of SunTrust, or in which SunTrust has or hereafter acquires a lien, security interest, or other right; and (b) any existing or hereafter created lien or security interest in favor of Guarantor in any property of Borrower. 

	
5.
	
Guarantor waives notice of future advances and notice of acceptance of the guaranty and notice, including notice of default, on any Obligation to which it may apply, and waives notice of presentment and demand for payment of any of the Obligations, suit or other action taken by SunTrust against, and any other notice to, Guarantor or to any other party liable for the Obligations. Guarantor waives all defenses, offsets and counterclaims which Guarantor may at any time have to any claim of SunTrust against Borrower. Except for any limitation which is specified above with respect to the amount of the maximum liability of Guarantor, this is an unconditional guaranty, and the liability of Guarantor to SunTrust shall not be terminated or in any way limited by reason or as the result of anything set forth or contained in any writing evidencing all or any part of the Obligations, nor shall it be limited to a proportionate part of the total of the Obligations. This is a guaranty of payment and not of collection and Guarantor waives any right to require that any action be brought against Borrower or any other person or to require that resort be had to any security or to any balance of any deposit account or credit on the books of SunTrust in favor of Borrower or any other person and agrees that SunTrust is not responsible for the validity, perfection, recordation or enforceability of any collateral or security for the Obligations. 

	
6.
	
Guarantor hereby ratifies, confirms, and adopts all the terms, conditions, agreements and stipulations of all notes and other evidences of the Obligations heretofore or hereafter executed.  Without in any way limiting the generality of the foregoing, Guarantor waives and renounces any and all homestead exemption right Guarantor may have under or by virtue of the Constitution or laws of any state, or the United States, as against the obligation hereby created, provided however, that such waiver shall not apply to any obligation created hereunder which arises from any of the Obligations that are consumer credit transactions; and Guarantor does hereby transfer, convey and assign, and direct any Trustee in Bankruptcy or receiver to deliver to SunTrust, a sufficient amount of property or money in any homestead exemption that may be allowed to Guarantor to pay any Obligation in full and all reasonable costs of collection.  Guarantor waives and renounces any defense to any of the Obligations which may be available to or could be asserted by Borrower, except for payment.  

	
7.
	
Guarantor subordinates all indebtedness of Borrower owing to Guarantor, whether now existing or hereafter arising, to the Obligations. Guarantor further agrees that it shall not be subrogated to, and will not enforce on its behalf, any right of action which SunTrust may have against Borrower until every Obligation shall have been paid in full. SunTrust shall have the right, immediately and without further action by it, to set off against any obligation of Guarantor to SunTrust, all money owed by SunTrust in any capacity to Guarantor, after the occurrence of a default by Borrower and the failure of Borrower to cure such default during any applicable grace or cure period.

			
	
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8.
	
A subsequent guaranty by Guarantor shall not be deemed to be in lieu of or to supersede or terminate this guaranty but shall be construed as an additional or supplementary guaranty unless otherwise expressly provided therein; and in the event Guarantor, or any other guarantor, has given to SunTrust a previous guaranty or guaranties, this guaranty shall be construed to be an additional or supplemental guaranty, and not to be in lieu thereof or to terminate such previous guaranty or guaranties unless expressly so provided herein. Notwithstanding the foregoing to the contrary, in the event any previous or subsequent guaranty by Guarantor does not exclude an Excluded Swap Obligation, the terms of this guaranty as it relates to any Excluded Swap Obligation will control.  

	
9.
	
This guaranty shall be binding on the Guarantor, notwithstanding the failure of any further contemplated guarantor(s) to execute similar instruments and notwithstanding the fact that the signature of one or more other parties guaranteeing the Obligations or any other existing or future signature shall be forged or unauthorized. The revocation of this guaranty in the manner permitted hereunder by Guarantor or any other party guaranteeing the Obligation, or the release by SunTrust of any one or more parties guaranteeing the Obligations, or the death of Borrower or Guarantor or any other party guaranteeing the Obligations, shall not affect or limit the liability of Guarantor, and SunTrust shall be under no duty to notify Guarantor of any such revocation, release or death.

	
10.
	
Guarantor warrants to SunTrust that Guarantor has adequate means to obtain from Borrower on continuing basis information concerning the financial condition of Borrower and that Guarantor is not relying on SunTrust to provide such information either now or in the future. Guarantor waives all errors and omissions in connection with SunTrust’s administration of the Obligations except behavior which amounts to gross negligence or willful misconduct. Guarantor represents and warrants that as of the date of this Guaranty it is an “eligible contract participant” as defined in the Commodity Exchange Act.

	
11.
	
No invalidity, irregularity or unenforceability of all or any part of the Obligations or of any collateral or security therefor shall affect, impair, or be a defense to this guaranty, and this guaranty is a primary obligation of Guarantor.

	
12.
	
The term “Guarantor” as used herein shall mean the undersigned Guarantor and if the undersigned is a partnership or limited liability company, the obligations and liability of Guarantor shall remain in full force and applicable notwithstanding any changes in the identity of the parties comprising the partnership or limited liability company, and the term “Guarantor” shall include any altered or successor partnership, limited liability company or other legal entity, and the predecessor partnership or limited liability company, and their partners or member/managers shall not thereby be released from any obligation or liability.

	
13.
	
No delay on the part of SunTrust in exercising any rights hereunder or failure to exercise the same shall operate as a waiver of such rights; no notice to or demand on Guarantor shall be deemed to be a waiver of the obligation of Guarantor or of the right of SunTrust to take further action without notice or demand as provided herein; nor in any event shall any modification or waiver of the provisions of this guaranty be effective unless in writing signed by SunTrust nor shall any such waiver be applicable except in the specific instance for which given.

	
14.
	
Notwithstanding the fact that the Obligations of Borrower may have been paid in full and this guaranty form may have been returned to Guarantor, the obligations of Guarantor hereunder shall continue in full force and effect with respect to any amounts that SunTrust may ever be required to repay under any Bankruptcy or insolvency laws.

	
15.
	
This guaranty shall not be construed to impose any obligation on SunTrust to extend or continue any credit at any time.

	
16.
	
Notice: This Section Does Not Apply To Transactions Governed by the Laws of North Carolina or West Virginia.

	

	
WAIVER OF JURY TRIAL. GUARANTOR AND SUNTRUST HEREBY KNOWINGLY, VOLUNTARILY, INTENTIONALLY, AND IRREVOCABLY WAIVE, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE RIGHT EITHER OF THEM MAY HAVE TO A TRIAL BY JURY IN RESPECT TO ANY LITIGATION, WHETHER IN CONTRACT OR TORT, AT LAW OR IN EQUITY, BASED HEREON OR ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS GUARANTY AND ANY OTHER DOCUMENT OR INSTRUMENT CONTEMPLATED TO BE EXECUTED IN CONJUNCTION WITH THIS GUARANTY, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY HERETO.  THIS PROVISION IS A MATERIAL INDUCEMENT FOR SUNTRUST ENTERING INTO OR ACCEPTING THIS GUARANTY.  FURTHER, GUARANTOR HEREBY CERTIFIES THAT NO REPRESENTATIVE OR AGENT OF SUNTRUST, NOR SUNTRUST’S COUNSEL, HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUNTRUST WOULD NOT, IN THE EVENT OF SUCH LITIGATION, SEEK TO ENFORCE THIS WAIVER OF RIGHT TO JURY TRIAL PROVISION.

	
17.
	
Each reference herein to Borrower shall be deemed to include Borrower and its successors and assigns.  Each reference herein to SunTrust shall be deemed to include its successors and assigns, in whose favor the provisions of this guaranty shall also inure. Each reference herein to Guarantor shall be deemed to include heirs, executors, administrators, legal representatives, successors and assigns, all of whom shall be bound by the provisions of this guaranty.

			
	
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18.
	
Guarantor agrees that certain material events and occurrences relating to this guaranty bear a reasonable relationship to the laws of Florida.  This guaranty shall be governed the laws of such jurisdiction and, unless applicable law provides otherwise, in the event of any legal proceeding arising out of or related to this guaranty, the guarantor consents to the jurisdiction and venue of any court located in such jurisdiction.  To the extent that any provision in this guaranty is inconsistent with applicable law, SunTrust will comply with applicable law.

The undersigned Guarantor has read, understands and agrees to the provisions of this guaranty and has executed the same voluntarily under seal, with full authority and with the intent to be legally bound by its terms, conditions and obligations.

 

	
 
	
(Entity Name)
	
 
	
 

	
 
	
 
	
 
	
 
	
 

	
 
	
By:
	
(Entity Name)
	
 
	
 

 

	
 
	
By:
	
(Entity Name)
	
 

	
 
	
 
	
(State of Incorporation)
	
 

 

	
 
	
By:
	
\s\ Dirk A. Montgomery

	
 
	
 
	
Dirk A. Montgomery,

	
 
	
 
	
Executive Vice President and Chief Financial Officer

 

			
	
{29820939;1}630071 (11/13) Attorney Prepared
	
Page 5 of 4Exhibit 10.1

Execution Copy

SECOND AMENDMENT

TO

LIGNITE SALES AGREEMENT

 

THIS SECOND AMENDMENT TO LIGNITE SALES AGREEMENT (“Amendment”) is made and entered into as of the 16th day of March, 2015, among COYOTE CREEK MINING COMPANY, L.L.C., a Nevada limited liability company (“Seller”), and OTTER TAIL POWER COMPANY, a Minnesota corporation (“Otter Tail”), NORTHERN MUNICIPAL POWER AGENCY, a political subdivision and municipal corporation of the State of Minnesota (“Northern Municipal”), MONTANA-DAKOTA UTILITIES CO., a division of MDU Resources Group, Inc., a Delaware corporation (“Montana-Dakota”), and NORTHWESTERN CORPORATION, a Delaware corporation doing business as NorthWestern Energy (“NorthWestern” and, together with Otter Tail, Northern Municipal and Montana-Dakota, the “Utilities” and collectively, “Buyer”).

RECITALS:

WHEREAS, Seller and Buyer are parties to the Lignite Sales Agreement dated as of October 10, 2012, as amended as of January 30, 2014 (the “Lignite Sales Agreement”);

WHEREAS, Seller has arranged financing for the development and operation of the Mine and Seller and Buyer have determined that certain amendments to the Lignite Sales Agreement are needed to facilitate such financing; and

WHEREAS, Seller and Buyer desire to amend the Lignite Sales Agreement as hereinafter provided.

AGREEMENT:

NOW, THEREFORE, in consideration of the foregoing and the covenants and agreements of the Parties as herein set forth, the Parties hereby agree as follows:

1.           All capitalized terms used in this Amendment shall have the meanings ascribed to them in the Lignite Sales Agreement unless such terms are otherwise defined herein.

2.           Section 1 of the Lignite Sales Agreement is hereby amended to delete the definition of “Transferor” in its entirety and to include the following definitions:

“Advance Lignite Payments” shall have the meaning set forth in the first paragraph of Section 7.2.

“Monthly Invoice” shall have the meaning set forth in Section 8.1(a).

 

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“Permitted Utility” means any company which (i) owns or operates facilities used for the generation, transmission or distribution of electric energy for sale (other than sales to tenants or employees of the company operating such facilities for their own use and not for resale), and (ii) is subject to regulation (including without limitation rate regulation) by any federal regulatory authority or by any utility commission, board, agency or officer of any State of the United States or the District of Columbia.  For purposes of this definition, a “Permitted Utility” shall include: (x) an electric cooperative (including a rural electric cooperative) meeting the requirements set forth in clause (i) above, (y) an investor-owned utility meeting the requirements of each of clauses (i) and (ii) above, and (z) a joint action power agency (including municipal power agencies and municipal power corporations) meeting the requirements of each of clauses (i) and (ii) above or meeting the requirements of clause (i) above and either the joint action power agency has a rating of, or has outstanding debt, including municipal bonds, with a rating of, A3 (Moody’s) or A- (S&P) immediately prior to the assignment contemplated in Section 22.11(ii).

 

“Production Delay Period” shall have the meaning set forth in Section 7.2.

“Seller’s Lender Payment” shall mean for each Seller’s Lender, a monthly payment amount consisting of the Seller’s Loan and Lease Obligations and Seller’s Loan and Lease Principal Obligations owing to such Seller’s Lender during the month in question.  The amortization schedule for each loan provided by a Seller’s Lender in respect of a Dragline, Fixed Capital Assets, and, if applicable, Rolling Stock and Working Capital together with obligations relating to default interest, debt yield maintenance premium and any other amounts arising as a result of any optional prepayment, termination or default of this Agreement or Seller’s Loans and Leases shall be agreed to by the Parties in a letter agreement executed by the Parties and delivered to the applicable Seller’s Lender at the time the applicable Seller’s Lender extends credit to Seller (each, a “Letter Agreement”).  Thereafter, the amortization schedule in each Letter Agreement shall not be amended without the prior written consent of the applicable Seller’s Lender.

“Seller’s Lenders” shall mean each of the lenders that provide Seller’s Loans and Leases in respect of the Dragline, Fixed Capital Assets, Rolling Stock and Working Capital.

3.           The first paragraph of Section 7.2 of the Lignite Sales Agreement is hereby deleted and replaced with the following:

During the Production Period, Buyer shall pay Seller in accordance with Section 8 an amount that equals the sum of (i) the Cost of Production (Section 7.2(a)), (ii) the Agreed Profit payable to Seller (Section 7.2(c)(i)) and (iii) the Capital Charge (Section 7.2(d)).  Amounts due under Section 7.2(a)(ii) and Section 7.2(a)(iii) shall be paid to accounts designated by Seller in its Monthly Invoice.  During any period between December 31, 2016 and the Production Date (“Production Delay Period”), Buyer shall make payments under Section 7.2(a)(ii) and Section 7.2(a)(iii) as advance payments for lignite to be delivered hereunder (“Advance Lignite Payments”).  Seller’s Loan and Lease Principal Obligations paid before the originally scheduled due dates therefor and before the Production Date shall also constitute Advance Lignite Payments.  All amounts payable by Buyer during the Production Period under this Section 7.2 shall constitute “Compensation” during the Production Period.  Buyer acknowledges that when no lignite is mined, processed, sold or delivered during the Production Period, Buyer shall continue to pay the Capital Charge and the portion of the Cost of Production that is incurred by Seller in accordance with the terms of this Agreement and invoiced to Buyer even when lignite deliveries are not made (referred to by the Parties as “period costs,” as opposed to “product costs,” which are not invoiced when lignite deliveries are not made).

 

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4.           The last paragraph of Section 7.2(a)(i), on page 23 of the Lignite Sales Agreement, is hereby amended by adding the following concluding phrase:

and (4) the sum of the Advance Lignite Payments made by Buyer in respect of a Production Delay Period, other than amounts paid by Buyer against Seller’s Loan and Lease Principal Obligations before the originally scheduled due dates therefor.  Amounts that are credited under item (4) in the preceding sentence shall be credited under Section 7.2(a)(i).

 

5.           Section 7.2(a)(ii) is hereby amended by deleting the word “Buyer” from the beginning of the third sentence and replacing it with the word “Seller.”

6.           Section 7.2(a)(ii) is hereby amended by adding the following concluding sentences:

Notwithstanding anything to the contrary in this Agreement, in respect of the Dragline and Fixed Capital Assets that are subject to Seller’s Loans and Leases, Seller shall invoice, and Buyer shall pay to accounts designated by Seller, depreciation and/or amortization charges that are calculated in accordance with the terms of the applicable Letter Agreement.  Buyer shall not dispute any such invoiced amount that is calculated in accordance with the terms of the applicable Letter Agreement or any other amounts owing under Section 7.2(a)(ii), Section 7.2(a)(iii) and Section 16.3.

7.           Section 7.2(a)(iii) is hereby deleted and replaced with the following:

All Seller’s Loan and Lease Obligations, and all Seller’s Loan and Lease Principal Obligations as and when the same become due and payable, including those that are paid or payable on or before the originally scheduled due date of such payment.

 

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8.           The first sentence of Section 8.1(a) of the Lignite Sales Agreement is hereby deleted and replaced with the following sentence:

On or before the (10th) Day of each Month, Seller shall furnish Buyer with a written invoice (the “Monthly Invoice”) which sets forth the amounts due under Section 7 for the immediately preceding Month, and shall separately designate on each such Monthly Invoice any amounts due under Section 7.2(a)(ii) and Section 7.2(a)(iii), and the accounts to which payment of such amounts is to be made.

9.           Section 8.1(b) of the Lignite Sales Agreement is hereby deleted and replaced with the following:

Buyer shall pay Seller the amounts reflected on each Monthly Invoice and any notice under the Letter Agreements as being due and payable.  Buyer shall make such payments to accounts designated by Seller by wire transfer in immediately available federal funds within ten (10) Days of Buyer’s receipt of the Monthly Invoice.

10.         Section 12 of the Lignite Sales Agreement is hereby amended by adding a new Section 12.4, reading as follows:

Annually, each Utility shall deliver to Seller a copy of its Audit report and financial statements certified by an independent firm of certified public accounts, except that Montana-Dakota shall deliver to Seller a copy of such Audit report and financial statements of MDU Resources Group, Inc. Such deliveries shall occur when the applicable Utility has completed the report and statements but in no event later than one hundred eighty (180) days following the end of the applicable Utility’s fiscal year. At the request of any Utility, Seller shall enter into a separate nondisclosure agreement with the Utility generally prohibiting Seller from disclosing the financial statements provided under this Section 12.4 to any person other than Seller’s Lenders and any other persons designated in such agreement.

 

11.         Section 15.2(a) of the Lignite Sales Agreement is hereby amended by inserting the following at the conclusion thereof:

At any time obligations to Seller’s Lenders have not been paid in full, in the event Buyer notifies Seller of a Seller Default under Section 15.1(b) or this Section 15.2(a), Seller shall give similar notice to each Seller’s Lender within the time period provided for notice to Seller.

 

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12.         Section 15.2 of the Lignite Sales Agreement is hereby amended by adding a new subsection (c) thereto, reading as follows:

 

(c)          In the event that a Seller Default occurs under subsection (c), (d), (e), (f) or (g) of Section 15.1 while Seller’s Lender Payments are outstanding, the Utilities hereby waive, to the extent permitted by law, and shall not assert, any defense, claim or counterclaim to the covenants set forth in this Agreement (or any new lignite sales agreement as contemplated at the conclusion of this Section 15.2(c)) on the basis that it is an executory contract that cannot be assumed, assigned or enforced or any other theory directly or indirectly based on Section 365(c)(1) and (2) of the Bankruptcy Reform Act of 1978, or any successor provision of law of similar import.  Upon the occurrence of any such default the Utilities consent to the assumption and enforcement of each provision of the Agreement by Seller as debtor-in-possession or Seller’s trustee in bankruptcy, as the case may be, and agree to reconfirm the waiver set forth in the preceding sentence and agree, upon the request of a Seller’s Lender, and upon receipt of any applicable authorizations of a regulatory authority or court then having jurisdiction (which the Utilities will not oppose), to enter into a new lignite sales agreement with such debtor-in-possession or trustee in bankruptcy on terms identical to the terms of this Agreement.

13.         Section 15.4(a) of the Lignite Sales Agreement is hereby deleted in its entirety and replaced with the following:

Buyer fails to timely pay Seller any amount due under this Agreement that is not the subject of a bona fide dispute; provided, that the existence of a bona fide dispute with respect to any amount due under this Agreement shall not relieve Buyer from paying any other amount due under this Agreement that is not then subject of a bona fide dispute; and

14.         Section 15.9 of the Lignite Sales Agreement is hereby amended by adding a new concluding sentence, as follows:

Without limiting the foregoing, Utilities agree that they shall not set off against any payments required to be made by them under Section 7.2(a)(ii), Section 7.2(a)(iii) and Section 16.3 of this Agreement, any amounts owed to them by Seller or the amount of any claim by them against Seller.

15.         Section 16.3 of the Lignite Sales Agreement is hereby deleted in its entirety and replaced with the following:

In the event of a termination of this Agreement prior to the expiration of the Term or a termination of the Production Period prior to December 31, 2040, Buyer shall, or shall cause its affiliate to, promptly purchase Seller’s Membership Interests pursuant to the terms and conditions of a purchase and sale agreement for an amount equal to the Equity Value (the “Early Termination Buyout”).  Upon Buyer or its affiliate acquiring the Membership Interests from NACoal, Buyer will (i) cause Seller to satisfy (and, if Seller has insufficient funds to satisfy, Buyer will advance to Seller sufficient funds to satisfy), or (ii) if permitted by the applicable Seller’s Lender, assume, all Seller’s Loan and Lease Obligations and Seller’s Loan and Lease Principal Obligations owed to the applicable Seller’s Lender.

 

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16.         Section 17 of the Lignite Sales Agreement is hereby amended by adding a new concluding sentence, as follows:

Unless all obligations to Seller’s Lenders have been irrevocably paid in full, no Party shall waive any rights or obligations under or pursuant to the Agreement without the prior written consent of Seller’s Lenders if such waiver would, directly or indirectly, reduce, impair or otherwise diminish Seller’s ability to make payment of Seller’s Lender Payments.

17.         Section 22.11 of the Lignite Sales Agreement is hereby amended by adding a new concluding sentence, as follows:

 

Unless all obligations to Seller’s Lenders have been irrevocably paid in full, no Party shall assign its obligations under this Agreement, provided that:

 

	
  

	
(i)

	
a Utility may make an assignment to an Affiliate of which the Utility owns or controls greater than 50.1% of the capital stock (or other equivalent equity interest) at the time of the assignment and at all times thereafter until Seller’s Lenders are irrevocably repaid in full, provided that (A)(I) all of the corporate credit ratings of such Affiliate immediately prior to such assignment shall be equal to or better than all of the corporate credit ratings of the assigning Utility immediately prior to such assignment and such Affiliate assumes the obligations of the assigning Utility pursuant to an assumption agreement in form and substance reasonably satisfactory to Seller’s Lenders and (II) if such Affiliate does not have a corporate credit rating, such assignment shall not be permitted pursuant to this clause (A); or (B) the assigning Utility guarantees the obligations of its Affiliate pursuant to a guarantee in form and substance reasonably satisfactory to Seller’s Lenders until such time as such Affiliate has corporate credit ratings equal to or better than the corporate credit ratings of the assigning Utility immediately prior to assignment and, in the case of each of clauses (A) and (B), such Affiliate or assigning Utility, as applicable, shall have delivered an opinion of in-house counsel licensed in the state whose law governs the assumption agreement or guarantee (or, if no in-house counsel is so licensed, external counsel who is so licensed) in form and substance reasonably satisfactory to Seller’s Lenders as to the due authorization, execution, delivery and enforceability of such assumption agreement or guarantee;

 

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(ii)

	
a Utility may make an assignment to a third party that acquires all the Utility’s assets in the Plant and assumes all the obligations of the Utility under the Lignite Sales Agreement after the date of such assignment, provided that (A) such assignee is a Permitted Utility and all of its corporate credit ratings immediately prior to such assignment shall be equal to or better than all of the corporate credit ratings of the assigning Utility immediately prior to such assignment and such assumption is made pursuant to an assumption agreement in form and substance reasonably satisfactory to Seller’s Lenders and in respect of which such third party shall have delivered an opinion of in-house counsel licensed in the state whose law governs the assignment (or, if no in-house counsel is so licensed, external counsel who is so licensed) in form and substance reasonably satisfactory to the Seller’s Lenders as to the due authorization, execution, delivery and enforceability of such assumption agreement and (B) during the term of the Lignite Sales Agreement only one assignment by any of the Utilities pursuant to this clause (ii) shall be permitted without the prior written consent of the Seller’s Lenders to an assignee that satisfies the criteria of this clause (ii); and provided further, if such third party does not have a corporate credit rating, such assignment shall not be permitted pursuant to this clause (ii); and

 

	
  

	
(iii)

	
a Utility may make an assignment to a third party with the Seller’s Lenders’ prior written consent, which consent shall be at the Seller’s Lenders’ sole discretion, pursuant to an assumption agreement in form and substance satisfactory to the Seller’s Lenders and in respect of which such third party shall have delivered an opinion of counsel in form and substance satisfactory to the Seller’s Lenders as to the due authorization, execution, delivery and enforceability of such assumption agreement.

 

18.         Section 22.12(b) of the Lignite Sales Agreement is hereby amended by replacing the first Notice address for Seller’s Authorized Representative to the following:

Coyote Creek Mining Company, L.L.C.

6502 17th Street SW

Zap, North Dakota  58580

Attention:  President

Email:  Jim.Melchior@nacoal.com

19.         Section 22.12(b) of the Lignite Sales Agreement is hereby amended by replacing the first Notice address for Buyer’s Authorized Representative with the following:

Otter Tail Power Company

215 South Cascade Street

Fergus Falls, MN 56537

Attn: Manager, Supply Engineering

Email: wswanson@otpco.com

20.         Section 22.12(b) of the Lignite Sales Agreement is hereby amended by adding the following concluding paragraph:

Within five Days of a Seller’s Lender’s extension of credit to Seller, Seller shall provide a written notice to Buyer’s Authorized Representative setting forth the Seller’s Lender’s notice address to enable Buyer to seek consents and provide notices as provided for in Section 17, Section 22.11 and Section 22.13 of this Agreement.

 

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21.         Section 22.13 of the Lignite Sales Agreement is hereby amended by adding a new concluding sentence, as follows:

Unless all obligations to Seller’s Lenders have been paid in full, the Parties shall obtain the prior written consent of Seller’s Lenders prior to modifying or amending any terms or provisions hereof if such modification or amendment would, directly or indirectly, reduce, impair or otherwise diminish Seller’s ability to make payment of Seller’s Lender Payments, including without limitation the terms and provisions of Section 2.3, Section 6.2.2, Section 7.2(a)(ii), Section 8.1(a) and Section 16 of this Agreement.

22.         The Lignite Sales Agreement, as amended hereby, shall continue and remain in full force and effect.

23.         This Amendment may be executed in one or more counterparts, each of which, by facsimile or otherwise, shall be deemed an original, but all of which together shall constitute but one and the same original instrument.

 

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IN WITNESS WHEREOF, the Parties have executed this Amendment as of the day and year first above written.

 

	
COYOTE CREEK MINING COMPANY, L.L.C.

	 	 	 
	
By: 

	/s/ James F. Melchior	 
	 	Name:  James F. Melchior	 
	 	Title:  President	 
	 	 	 
	Attest:	/s/ John Neumann	 
	 	Name:  John Neumann, Secretary	 

 

	
OTTER TAIL POWER COMPANY

	 	 	 
	
By: 

	/s/ Timothy J. Rogelstad	 
	 	Name:  Timothy J. Rogelstad	 
	 	Title:  President	 
	 	 	 
	Attest:	/s/ Jennifer O. Smestad	 
	 	
Name:  Jennifer O. Smestad

	 

 

	

NORTHERN MUNICIPAL POWER AGENCY

	 	 	 
	
By: 

	/s/ Lucas Spaeth	 
	 	Name:  Lucas Spaeth	 
	 	Title:    Vice President	 
	 	 	 
	Attest:	/s/ Dalene Monsebroten	 
	 	
Name:  Dalene Monsebroten, Secretary

	 

	

MONTANA-DAKOTA UTILITIES CO. a Division of MDU Resources Group, Inc.

	 	 	 
	
By: 

	/s/ Nicole Kivisto	 
	 	
Name:  Nicole Kivisto

	 
	 	Title:  President and Chief Executive Officer	 
	 	 	 
	Attest:	/s/ Daniel S. Kuntz	 
	 	
Name:  Daniel S. Kuntz, Associate General Counsel

	 

 

	

NORTHWESTERN CORPORATION d/b/a NorthWestern Energy

	 	 	 
	
By: 

	/s/ Robert C. Rowe	 
	 	
Name:  Robert C. Rowe

	 
	 	Title:  President and CEO	 
	 	 	 
	Attest:	/s/ Emily Larken	 
	 	
Name:  Emily Larken

	 

 

[Signature page to Second Amendment to Lignite Sales Agreement]

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