Document:

Exhibit 4.02

 

CALCULATION
AGENCY AGREEMENT

 

CALCULATION AGENCY AGREEMENT, dated as of March 15,
2006 (this “Agreement”), between Lehman Brothers Holdings Inc. (the “Company”)
and Lehman Brothers Inc., as Calculation Agent.

 

WHEREAS, the Company proposes to issue and sell its
Principal Protected USD-Asian Basket FX-Linked Notes (the “Notes”) from time to time;

 

WHEREAS, the terms of the Notes are described in a
pricing supplement dated March 9, 2006 (in connection with the performance
by the Calculation Agent of its services hereunder with respect to the Notes,
the pricing supplement relating to the Notes is referred to herein as the “relevant
Pricing Supplement”) to the prospectus supplement dated May 18, 2005
and the prospectus dated May 18, 2005;

 

WHEREAS, the Notes will be issued under an Indenture,
dated as of September 1, 1987, between the Company and Citibank, N.A., as
Trustee (the “Trustee”), as supplemented and amended by supplemental
indentures dated as of November 25, 1987, November 27, 1990, September 13,
1991, October 4, 1993, October 1, 1995, and June 26, 1997, and
incorporating Standard Multiple Series Indenture Provisions dated July 30,
1987, as amended November 16, 1987 (collectively, the “Indenture”);
and

 

WHEREAS, the Company requests the Calculation Agent to
perform certain services described herein in connection with the Notes;

 

NOW THEREFORE, the Company and the Calculation Agent
agree as follows:

 

1.                                       Appointment
of Agent. The Company hereby appoints Lehman Brothers Inc. as Calculation
Agent and Lehman Brothers Inc. hereby accepts such appointment as the Company’s
agent for the purpose of performing the services hereinafter described upon the
terms and subject to the conditions hereinafter mentioned.

 

2.                                       Calculations
and Information Provided. In response to a request made by the Trustee for
a determination of the Redemption Amount with respect to any series of the
Notes, the Calculation Agent shall determine the Redemption Amount (as set
forth below) on the Valuation Date (as defined below) in accordance with the
terms of the Notes and this Agreement and notify the Trustee of its
determination. In addition, the Calculation Agent shall also be responsible for
determining each of the following items for the Notes, to the extent
applicable:

 

(a)                                  whether
a Disruption Event (as defined below) has occurred;

 

(b)                                 whether
a Price Source Unavailability Event (as defined below) has occurred; and

 

(c)                                  any
other calculation, determination or adjustment specified as being made by the
Calculation Agent in this Agreement, the relevant Pricing Supplement or the
Notes.

 

 

3.                                       Calculations.
Any calculation or determination by the Calculation Agent pursuant hereto shall
be made at the sole discretion of the Calculation Agent and shall (in the
absence of manifest error) be final and binding. Any calculation made by the
Calculation Agent hereunder shall, at the Trustee’s request, be made available
at the Corporate Trust Office. The procedures the Calculation Agent will use to
determine the information described herein with respect to the Notes is set
forth as follows:

 

(a)  On the Valuation Date, the
Calculation Agent shall calculate the Redemption Amount for the Notes. The “Redemption
Amount”, for each $1 principal amount of the Notes, is the amount equal to
the sum of (a) $1 plus (b) the
Additional Amount.

 

(i)                                     The “Additional
Amount”, for each $1 principal amount of the Notes, equals (subject to the
occurrence of a Disruption Event) the greater of (i) zero and (ii) 300%
times the Basket Value.

 

(ii)                                  The “Reference Currencies”
are the Euro (EUR), Pound Sterling (GBP), Brazilian Real (BRL), Canadian Dollar
(CAD), Chinese Yuan (CNY), Hong Kong Dollar (HKD), Japanese Yen (JPY), Singapore Dollar (SGD) and
U.S. Dollar (USD).

 

(iii)                               The “Basket Value”
equals the sum of:

 

a.               a quotient, the numerator of which is 0.08388
and the denominator of which is the
Settlement Rate for EUR plus

 

b.              a quotient, the numerator of which is 0.05756
and the denominator of which is the
Settlement Rate for GBP plus

 

c.               a quotient, the numerator of which is 0.21653
and the denominator of which is the
Settlement Rate for BRL plus

 

d.              a quotient, the numerator of which is 0.23195
and the denominator of which is the
Settlement Rate for CAD plus

 

e.               a quotient, the numerator of which is 1.20735
and the denominator of which is the
Settlement Rate for CNY plus

 

f.                 a quotient, the numerator of which is 0.77612
and the denominator of which is the
Settlement Rate for HKD plus

 

g.              a quotient, the numerator of which is 17.64075
and the denominator of which is the
Settlement Rate for JPY plus

 

h.              a quotient, the numerator of which is 0.16283
and the denominator of which is the
Settlement Rate for SGD plus

 

i.                  a quotient, the
numerator of which is -1.0000 and
the denominator of which is the Settlement Rate for USD.

 

2

 

(iv)                              The “Settlement Rate”
for each Reference Currency is the Reference Exchange Rate on the Valuation
Date, observed as per the Settlement Rate Option (subject to the occurrence of
a Price Source Unavailability Event).

 

a.               The “Reference Exchange
Rates” are the spot exchange rates for each of the Reference Currencies
quoted against the U.S. dollar expressed as number of currency units per USD 1.

 

b.              The “Settlement Rate Option” for
each Reference Currency is as follows:

 

	
  Reference

  Currency

  	
   

  	
  Settlement Rate Option

  
	
  EUR

  	
   

  	
  One divided by the spot rate in (A):

  

  (A) The U.S. Dollar/Euro official fixing rate, expressed as the amount
  of U.S. Dollars per one Euro, for settlement in two Business Days reported by
  the Federal Reserve Bank of New York which appears on Reuters Screen 1FED to
  the right of the caption “EUR” at approximately 10.00 a.m. New York
  time, on that Valuation Date.

  
	
   

  	
   

  	
   

  
	
  GBP

  	
   

  	
  One divided by the spot rate in (A):

  

  (A) The U.S. Dollar/Sterling official fixing rate, expressed as the
  amount of U.S. Dollars per one Pound Sterling, for settlement in two Business
  Days reported by the Federal Reserve Bank of New York which appears on
  Reuters Screen 1FED to the right of the caption “GBP” at approximately 10.00 a.m.
  New York time, on that Valuation Date.

  
	
   

  	
   

  	
   

  
	
  BRL

  	
   

  	
  The
  Brazilian Real/U.S. Dollar offered rate for U.S. Dollars, expressed as the
  amount of Brazilian Reais per one U.S. Dollar, for settlement in two Business
  Days reported by the Banco Central do Brasil on SISBACEN Data System under
  transaction code PTAX-800 (“Consulta de Cambio” or Exchange Rate Inquiry),
  Option 5 (“Cotacoes para Contabilidade” or Rates for Accounting Purposes),
  which appears on Reuters Screen BRFR Page under the caption “Dolar PTAX”
  at approximately 6:30 pm Sao Paolo time on the Valuation Date.

  
	
   

  	
   

  	
   

  
	
  CAD

  	
   

  	
  The
  Canadian Dollar/U.S. Dollar official fixing rate, expressed as the amount of
  Canadian Dollars per one U.S. Dollar, for settlement in one Business Day
  reported by the Federal Reserve Bank of New York which appears on Reuters
  Screen 1FED to the right of the caption “CAD” at approximately 10.00 a.m.
  New York time, on that Valuation Date.

  
	
   

  	
   

  	
   

  
	
  CNY

  	
   

  	
  The
  Chinese Yuan/U.S. Dollar official fixing rate, expressed as the amount of Chinese
  Yuan per one U.S. Dollar, for settlement in two Business Days reported by the
  Federal Reserve Bank of New York which appears on Reuters Screen 1FEE to the
  right of the caption “CNY” at approximately 12.00 p.m. New York time, on
  that Valuation Date.

  
	
   

  	
   

  	
   

  
	
  HKD

  	
   

  	
  The Hong Kong Dollar/U.S. Dollar official fixing rate, expressed as
  the amount of Hong Kong Dollars per one U.S. Dollar, for settlement in two
  Business Days reported by the Federal Reserve Bank of New York which appears
  on Reuters Screen 1FEE to the right of the caption “HKD” at approximately
  12.00 p.m. New York time, on that Valuation Date.

  
	
   

  	
   

  	
   

  
	
  JPY

  	
   

  	
  The
  Japanese Yen/U.S. Dollar official fixing rate, expressed as the amount of
  Japanese Yen per one U.S. Dollar, for settlement in two Business Days reported
  by the Federal Reserve Bank of New York which appears on Reuters Screen 1FED
  to the right of the caption “JPY” at approximately 10.00 a.m. New York
  time, on that Valuation Date.

  
	
   

  	
   

  	
   

  
	
  SGD

  	
   

  	
  The Singapore Dollar/U.S. Dollar spot rate at 11:00 a.m., Singapore
  time, expressed as the amount of Singapore Dollar per one U.S. Dollar, for
  settlement in two Business Days, reported by the Association of Banks in
  Singapore which appears on the Reuters Page ABSIRFIX01 to the right of
  the caption “Spot” under the column “SGD” at approximately 11:30 a.m.,
  Singapore time, on that Valuation Date.

  

 

The screen or time of observation indicated in relation to any
Settlement Rate Option above shall be deemed to refer to such screen or time of
observation as modified or amended from time to time, or to any substitute
screen thereto.

 

c.               The “Valuation
Date” is March 10, 2011 or, if such day is not a Valuation Business
Day, the next following Valuation Business day.

 

3

 

d.              A “Business Day”,
notwithstanding any provision in the Indenture, is any day that is not is not a
Saturday or Sunday and that is not a day on which banking institutions in New
York City generally are authorized or obligated by law or executive order to be
closed.

 

(b)  Upon the occurrence of a
Disruption Event with respect to any Reference Currency on any day during the
term of the notes, the Calculation Agent shall determine the Additional Amount
payable on the Maturity Date in good faith and in a commercially reasonable
manner.

 

(i)                                     A “Disruption
Event” means any of the following events (other than a Price Source
Unavailability Event), as determined in good faith by the Calculation Agent:

 

a.               the occurrence
and/or existence of an event on any day that has the effect of preventing or
making impossible, for any Reference Currency other than EUR, (x) the delivery
of USD from accounts inside the country for which a Reference Currency is the
lawful currency (such jurisdiction with respect to such Reference Currency, the
“Reference Currency Jurisdiction”) to accounts outside that Reference Currency
Jurisdiction or (y) of any Reference Currency between accounts inside any
Reference Currency Jurisdiction or to a party that is a non-resident of such
Reference Currency Jurisdiction;

 

b.              the occurrence of
any event causing the Reference Exchange Rate for any Reference Currency to be
split into dual or multiple currency exchange rates; or

 

c.               the occurrence
and/or existence of any event (other than those set forth in (A) or (B) above
or those constituting a Price Source Unavailability Event) with respect to any
Reference Currency that prevents or makes impossible (x) the Calculation Agent’s
ability to calculate the Additional Amount, (y) the fulfilment of our
obligations under the notes, or (z) our ability or the ability of any of our
affiliates through which we hedge our position under the notes to hedge such
position or to unwind all or a material portion of such hedge.

 

(c)  Upon the occurrence of a Price
Source Unavailability Event with respect to a Reference Currency, the
Settlement Rate for the affected Reference Currency will be determined in
accordance with the Fallback Rate Observation Methodology.

 

(i)                                     A “Price Source Unavailability Event”
means, as determined in good faith by the Calculation Agent, the Settlement
Rate being unavailable for a Reference Currency, or the occurrence of an event
(other than an event constituting a Disruption Event) that generally makes it
impossible to obtain the Settlement Rate for a Reference Currency, on the
relevant Valuation Date.

 

4

 

(ii)                                  The “Fallback Rate Observation Methodology”
means that the Settlement Rate for a Reference Currency will be calculated on
the basis of the arithmetic mean of the applicable spot quotations received by
the Calculation Agent at approximately 10:00 a.m., New York City time, on
the Valuation Business Day next succeeding the Valuation Date for the purchase
or sale for deposits in the Reference Currency by the New York offices of three
leading banks engaged in the interbank market (selected in the sole discretion
of the Calculation Agent) (the “Reference Banks”). If fewer than three
Reference Banks provide spot quotations then the Settlement Rate for such
Reference Currency will be determined by the Calculation Agent in good faith
and in a commercially reasonable manner.

 

4.                                       Fees
and Expenses. The Calculation Agent shall be entitled to reasonable
compensation for all services rendered by it as agreed to between the
Calculation Agent and the Company.

 

5.                                       Terms
and Conditions. The Calculation Agent accepts its obligations herein set
out upon the terms and conditions hereof, including the following, to all of
which the Company agrees:

 

(a)                                  in
acting under this Agreement, the Calculation Agent is acting solely as an
independent expert and not as an agent of the Company and does not assume any
obligation toward, or any relationship of agency or trust for or with, any of
the holders of the Notes;

 

(b)                                 unless
otherwise specifically provided herein, any order, certificate, notice,
request, direction or other communication from the Company or the Trustee made
or given under any provision of this Agreement shall be sufficient if signed by
any person who the Calculation Agent reasonably believes to be a duly
authorized officer or attorney-in-fact of the Company or the Trustee, as the
case may be;

 

(c)                                  the
Calculation Agent shall be obliged to perform only such duties as are set
out specifically herein and any duties necessarily incidental thereto;

 

(d)                                 the
Calculation Agent, whether acting for itself or in any other capacity, may become
the owner or pledgee of Notes with the same rights as it would have had if it
were not acting hereunder as Calculation Agent; and

 

(e)                                  the
Calculation Agent shall incur no liability hereunder except for loss sustained
by reason of its gross negligence or wilful misconduct.

 

6.                                       Resignation;
Removal; Successor. (a)  The Calculation Agent may at any time
resign by giving written notice to the Company of such intention on its part,
specifying the date on which its desired resignation shall become effective,
subject to the appointment of a successor Calculation Agent and acceptance of
such appointment by such successor Calculation Agent, as hereinafter provided. The
Calculation Agent hereunder may be removed at any time by the filing with
it of an instrument in writing signed by or on behalf of the Company and
specifying such removal and the date when it shall become effective. Such
resignation or removal shall take effect upon the appointment by the Company,
as hereinafter provided, of a successor Calculation Agent and the acceptance of
such appointment by such successor 

 

5

 

Calculation Agent. In the event a successor
Calculation Agent has not been appointed and has not accepted its duties within
90 days of the Calculation Agent’s notice of resignation, the Calculation Agent
may apply to any court of competent jurisdiction for the designation of a
successor Calculation Agent.

 

(b)                                 In
case at any time the Calculation Agent shall resign, or shall be removed, or
shall become incapable of acting, or shall be adjudged bankrupt or insolvent,
or make an assignment for the benefit of its creditors or consent to the appointment
of a receiver or custodian of all or any substantial part of its property,
or shall admit in writing its inability to pay or meet its debts as they
mature, or if a receiver or custodian of it or all or any substantial part of
its property shall be appointed, or if any public officer shall have taken
charge or control of the Calculation Agent or of its property or affairs, for
the purpose of rehabilitation, conservation or liquidation, a successor
Calculation Agent shall be appointed by the Company by an instrument in
writing, filed with the successor Calculation Agent. Upon the appointment as
aforesaid of a successor Calculation Agent and acceptance by the latter of such
appointment, the Calculation Agent so superseded shall cease to be Calculation
Agent hereunder.

 

(c)                                  Any
successor Calculation Agent appointed hereunder shall execute, acknowledge and
deliver to its predecessor, to the Company and to the Trustee an instrument
accepting such appointment hereunder and agreeing to be bound by the terms
hereof, and thereupon such successor Calculation Agent, without any further
act, deed or conveyance, shall become vested with all the authority, rights,
powers, trusts, immunities, duties and obligations of such predecessor with
like effect as if originally named as Calculation Agent hereunder, and such
predecessor, upon payment of its charges and disbursements then unpaid, shall
thereupon become obligated to transfer, deliver and pay over, and such
successor Calculation Agent shall be entitled to receive, all moneys,
securities and other property on deposit with or held by such predecessor, as
Calculation Agent hereunder.

 

(d)                                 Any
corporation into which the Calculation Agent hereunder may be merged or
converted or any corporation with which the Calculation Agent may be
consolidated, or any corporation resulting from any merger, conversion or
consolidation to which the Calculation Agent shall be a party, or any
corporation to which the Calculation Agent shall sell or otherwise transfer all
or substantially all of the assets and business of the Calculation Agent shall
be the successor Calculation Agent under this Agreement without the execution
or filing of any paper or any further act on the part of any of the
parties hereto.

 

7.                                       Certain
Definitions. Capitalized terms not otherwise defined herein are used herein
as defined in the Notes or, if not defined in the Notes, as defined in the
Indenture.

 

8.                                       Indemnification.
The Company will indemnify the Calculation Agent against any losses or
liability which it may incur or sustain in connection with its appointment
or the exercise of its powers and duties hereunder except such as may result
from the gross negligence or wilful misconduct of the Calculation Agent or any
of its agents or employees. The Calculation Agent shall incur no liability and
shall be indemnified and held harmless by the Company for or in respect of any
action taken or suffered to be taken in good faith by the Calculation Agent in
reliance upon written instructions from the Company.

 

9.                                       Notices.
Any notice required to be given hereunder shall be delivered in person, sent
(unless otherwise specified in this Agreement) by letter, telex or facsimile 

 

6

 

transmission or communicated by telephone (confirmed
in a writing dispatched within two Business Days), (a) in the case of the
Company, to it at 745 Seventh Avenue, New York, New York 10019 (facsimile:
(646) 758-3204) (telephone: (212) 526-7000), Attention: Treasurer, with a copy
to 399 Park Avenue, New York, New York 10022 (facsimile: (212) 526-0357)
(telephone: (212) 526-7000), Attention: Corporate Secretary, (b) in the
case of the Calculation Agent, to it at Lehman Brothers Inc., 745 Seventh Avenue, New York, NY 10019
(facsimile: (646) 758-3204) (telephone: (212) 526-7000), Attention: Treasurer
and (c) in the case of the Trustee, to it at 111 Wall Street, 5th Floor,
New York, New York 10043 (facsimile: (212) 657-3836) (telephone:  (212) 657-7805), Attention: Corporate Trust
Department or, in any case, to any other address or number of which the party
receiving notice shall have notified the party giving such notice in writing. Any
notice hereunder given by telex, facsimile or letter shall be deemed to be
served when in the ordinary course of transmission or post, as the case may be,
it would be received.

 

10.                                 GOVERNING
LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONTINUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK.

 

11.                                 Counterparts.
This Agreement may be executed in any number of counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.

 

12.                                 Benefit
of Agreement. This Agreement is solely for the benefit of the parties
hereto and their successors and assigns, and no other person shall acquire or
have any rights under or by virtue hereof.

 

7

 

IN WITNESS WHEREOF, this Agreement has been entered
into as of the day and year first above written.

 

 

	
   

  	
  LEHMAN BROTHERS HOLDINGS INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  LEHMAN BROTHERS INC.

  
	
   

  	
  as Calculation Agent

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

8EXHIBIT
4.1

 

 

FIRST
AMENDED AND RESTATED UNSECURED CREDIT AGREEMENT

 

	
  REVOLVING
  CREDIT COMMITMENT:

  	
   

  	
  $

  	
  150,000,000

  	
   

  
	
  LETTER OF CREDIT COMMITMENT:

  	
   

  	
  $

  	
  76,000,000

  	
   

  
	
  TOTAL COMMITMENT:

  	
   

  	
  $

  	
  226,000,000

  	
   

  

 

DATED AS
OF MARCH 14, 2006

 

AMONG

 

THE
EMPIRE DISTRICT ELECTRIC COMPANY

AS
BORROWER

 

AND

 

UMB
BANK, N.A.

INDIVIDUALLY
AND AS ADMINISTRATIVE AGENT

 

AND

 

BANK
OF AMERICA, N.A.

INDIVIDUALLY
AND AS SYNDICATION AGENT

 

AND

 

THE
OTHER FINANCIAL INSTITUTIONS PARTY HERETO

AS
LENDERS

 

ARRANGED
BY

UMB
BANK, N.A.

 

 

 

	
  SECTION
  1.

  	
  DEFINITIONS

  	
  4

  
	
  1.1.

  	
  Certain Definitions

  	
  4

  
	
  1.2.

  	
  Interpretation

  	
  10

  
	
  SECTION 2.

  	
  THE CREDIT

  	
  10

  
	
  2.1.

  	
  Loans

  	
  10

  
	
  2.2.

  	
  Commitments
  and Letter of Credit Commitments

  	
  10

  
	
  2.3.

  	
  Procedure
  for Borrowing on Revolving Credit Notes

  	
  11

  
	
  2.4.

  	
  Letter of
  Credit

  	
  12

  
	
  SECTION 3.

  	
  INTEREST

  	
  14

  
	
  3.1.

  	
  Elections

  	
  14

  
	
  3.2.

  	
  ABR
  Portions

  	
  14

  
	
  3.3.

  	
  LIBOR
  Portions

  	
  14

  
	
  3.4.

  	
  Computation

  	
  15

  
	
  3.5.

  	
  Minimum
  Amounts

  	
  15

  
	
  3.6.

  	
  Manner of
  Rate Selection

  	
  15

  
	
  3.7.

  	
  Lawful
  Rate

  	
  15

  
	
  SECTION 4.

  	
  FEES, PREPAYMENTS, TERMINATIONS
  AND APPLICATION OF PAYMENTS

  	
  16

  
	
  4.1.

  	
  Facility
  Fee

  	
  16

  
	
  4.2.

  	
  Utilization
  Fee

  	
  16

  
	
  4.3.

  	
  Letter of
  Credit Fees

  	
  13

  
	
  4.4

  	
  Agent’s
  Fee

  	
  16

  
	
  4.5.

  	
  Prepayments.

  	
  17

  
	
  4.6.

  	
  Credit
  Reductions

  	
  17

  
	
  4.7.

  	
  Place and
  Application of Payments

  	
  17

  
	
  4.8.

  	
  Capital
  Adequacy

  	
  18

  
	
  SECTION 5.

  	
  CONDITIONS PRECEDENT

  	
  18

  
	
  5.1.

  	
  Initial
  Extension of Credit

  	
  18

  
	
  5.2.

  	
  Each
  Extension of Credit Under a Revolving Credit Note

  	
  19

  
	
  5.3.

  	
  Issuance
  of Letter of Credit

  	
  19

  
	
  SECTION 6.

  	
  REPRESENTATIONS AND WARRANTIES

  	
  19

  
	
  6.1.

  	
  Organization
  and Qualification

  	
  19

  
	
  6.2.

  	
  Subsidiaries

  	
  19

  
	
  6.3.

  	
  Financial
  Reports

  	
  20

  
	
  6.4.

  	
  No
  Material Adverse Change

  	
  20

  
	
  6.5.

  	
  Litigation;
  Tax Returns; Approvals

  	
  20

  
	
  6.6.

  	
  Regulation
  U

  	
  20

  
	
  6.7.

  	
  No
  Default

  	
  20

  
	
  6.8.

  	
  ERISA

  	
  20

  
	
  6.9.

  	
  Full
  Disclosure

  	
  20

  
	
  6.10.

  	
  Corporate
  Authority and Validity of Obligations

  	
  20

  
	
  6.11.

  	
  No
  Default Under Other Agreements

  	
  21

  
	
  6.12.

  	
  Status
  Under Certain Laws

  	
  21

  
	
  6.13.

  	
  Compliance
  With Laws

  	
  21

  
	
  6.14.

  	
  Ownership
  of Property

  	
  21

  
	
  6.15.

  	
  Solvency

  	
  21

  
	
  6.16.

  	
  Pari
  Passu

  	
  21

  
	
  SECTION 7.

  	
  COVENANTS

  	
  21

  
	
  7.1.

  	
  Maintenance
  of Property

  	
  22

  
	
  7.2.

  	
  Taxes

  	
  22

  
	
  7.3.

  	
  Maintenance
  of Insurance

  	
  22

  
	
  7.4.

  	
  Financial
  Reports

  	
  22

  
	
  7.5.

  	
  Inspection

  	
  23

  
	
  7.6.

  	
  Consolidation,
  Merger and Sale of Assets

  	
  23

  
	
  7.7.

  	
  Liens

  	
  23

  
	
  7.8.

  	
  Notice of
  Suit or Material Adverse Change in Business or Default

  	
  24

  
	
  7.9.

  	
  ERISA

  	
  24

  
	
  7.10.

  	
  Use of
  Proceeds

  	
  25

  

 

 

	
  7.11.

  	
  Compliance
  With Laws

  	
  25

  
	
  7.12.

  	
  Fiscal
  Year

  	
  25

  
	
  7.13.

  	
  Maintenance
  of Existence

  	
  25

  
	
  7.14.

  	
  Maximum
  Total Indebtedness to Total Capitalization Ratio

  	
  25

  
	
  7.15.

  	
  Minimum
  Interest Coverage Ratio

  	
  25

  
	
  7.16.

  	
  Acquisitions

  	
  25

  
	
  7.17.

  	
  Patriot
  Act

  	
  25

  
	
  SECTION 8.

  	
  EVENTS OF DEFAULT AND REMEDIES

  	
  26

  
	
  8.1.

  	
  Events of
  Default

  	
  26

  
	
  8.2.

  	
  Remedies
  for Non-Bankruptcy Defaults

  	
  27

  
	
  8.3.

  	
  Remedies
  for Bankruptcy Defaults

  	
  27

  
	
  SECTION 9.

  	
  CHANGE IN CIRCUMSTANCES REGARDING
  LIBOR PORTIONS

  	
  27

  
	
  9.1.

  	
  Change of
  Law

  	
  28

  
	
  9.2.

  	
  Unavailability
  of Deposits or Inability to Ascertain the Adjusted LIBOR Rate

  	
  28

  
	
  9.3.

  	
  Taxes and
  Increased Costs

  	
  28

  
	
  9.4.

  	
  Funding
  Indemnity

  	
  29

  
	
  9.5.

  	
  Discretion
  of Bank as to Manner of Funding

  	
  29

  
	
  SECTION 10.

  	
  THE ADMINISTRATIVE AGENT

  	
  30

  
	
  10.1.

  	
  Appointment
  and Powers

  	
  30

  
	
  10.2.

  	
  Powers

  	
  30

  
	
  10.3.

  	
  General
  Immunity

  	
  30

  
	
  10.4.

  	
  No
  Responsibility for Loans, Recitals, Etc

  	
  30

  
	
  10.5.

  	
  Right to
  Indemnity

  	
  30

  
	
  10.6.

  	
  Action
  Upon Instructions of Required Banks

  	
  30

  
	
  10.7.

  	
  Employment
  of Agents and Counsel

  	
  30

  
	
  10.8.

  	
  Reliance
  on Documents; Counsel

  	
  31

  
	
  10.9.

  	
  May Treat
  Payee as Owner

  	
  31

  
	
  10.10.

  	
  Agent’s
  Reimbursement

  	
  31

  
	
  10.11.

  	
  Rights as
  a Bank

  	
  31

  
	
  10.12.

  	
  Bank
  Credit Decision

  	
  31

  
	
  10.13.

  	
  Resignation
  of Agent

  	
  31

  
	
  10.14.

  	
  Duration
  of Agency

  	
  32

  
	
  SECTION 11.

  	
  MISCELLANEOUS

  	
  32

  
	
  11.1.

  	
  Amendments
  and Waivers

  	
  32

  
	
  11.2.

  	
  Waiver of
  Rights

  	
  32

  
	
  11.3.

  	
  Several
  Obligations

  	
  32

  
	
  11.4.

  	
  Non-Business
  Day

  	
  33

  
	
  11.5.

  	
  Documentary
  Taxes

  	
  33

  
	
  11.6.

  	
  Representations

  	
  33

  
	
  11.7.

  	
  Notices

  	
  33

  
	
  11.8.

  	
  Costs and
  Expenses; Indemnity

  	
  33

  
	
  11.9.

  	
  Counterparts

  	
  34

  
	
  11.10.

  	
  Successors
  and Assigns; Governing Law; Entire Agreement

  	
  34

  
	
  11.11.

  	
  No Joint
  Venture

  	
  34

  
	
  11.12.

  	
  Severability

  	
  34

  
	
  11.13.

  	
  Table of
  Contents and Headings

  	
  34

  
	
  11.14.

  	
  Sharing
  of Payments

  	
  34

  
	
  11.15.

  	
  Jurisdiction;
  Venue; Waiver of Jury Trial

  	
  34

  
	
  11.16.

  	
  Participants

  	
  35

  
	
  11.17.

  	
  Assignment
  Agreements

  	
  35

  
	
  11.18.

  	
  Withholding
  Taxes

  	
  36

  
	
  11.19.

  	
  Confidentiality

  	
  38

  
	
  11.20.

  	
  Register

  	
  38

  
	
  11.21.

  	
  SPCs

  	
  38

  
	
  11.22.

  	
  Facsimile
  Signatures

  	
  36

  
	
  11.23.

  	
  STATUTORY
  STATEMENT MADE PURSUANT TO MO. REV. STAT. §432.045

  	
  39

  

 

2

 

EXHIBITS

 

	
  A

  	
   

  	
  Revolving
  Credit Note

  
	
  A-1

  	
   

  	
  Letter
  of Credit Note

  
	
  B

  	
   

  	
  Pricing
  Schedule

  
	
  C

  	
   

  	
  Subsidiaries
  of the Company

  
	
  D-1

  	
   

  	
  Company’s
  Kansas Counsel’s Opinion

  
	
  D-2

  	
   

  	
  Company’s
  Missouri Counsel’s Opinion

  
	
  E

  	
   

  	
  Quarterly
  Compliance Certificate

  
	
  F

  	
   

  	
  Existing
  Liens

  
	
  G

  	
   

  	
  Letter
  of Credit

  
	
  H

  	
   

  	
  Application

  
	
  I

  	
   

  	
  Notice
  of Payment Request

  

 

3

 

THE EMPIRE
DISTRICT ELECTRIC COMPANY

 

FIRST
AMENDED AND RESTATED UNSECURED CREDIT AGREEMENT

ORIGINALLY DATED JULY 15, 2005

 

March
14, 2006

 

UMB
Bank, N.A.

Kansas
City, Missouri

 

Bank of
America, N.A.

St.
Louis, Missouri

 

The
Other Financial Institutions Party Hereto

 

This
First Amendment and Restatement of that certain Unsecured Credit Agreement
between the parties hereto dated July 15, 2005 (the “Original Credit Agreement”),
is made as of this 14th day of March, 2006 and amends and restates
the Original Credit Agreement in its entirety. Unless the context otherwise
requires, all references to the Original Credit Agreement in any Loan Document
shall be deemed references to this Agreement.

 

The
undersigned, The Empire District Electric Company, a Kansas corporation (the “Company”)
hereby applies to you for your several commitments, subject to all the terms
and conditions hereof and on the basis of representations and warranties
hereinafter set forth, to make an unsecured credit (the “Credit”) including a
revolving credit (“Revolving Credit”) and a Letter of Credit facility available
to the Company, all as more fully set forth herein. Each of you is hereinafter
referred to individually as “Bank” and collectively as “Banks.”  UMB Bank, N.A., in its individual capacity is
sometimes referred to herein as “UMB”, and in its capacity as Administrative
Agent for the Banks is hereinafter in such capacity referred to as the “Agent”
and in its capacity of issuer of the Letter of Credit is referred to as L/C
Issuer. All capitalized terms not defined in the text of this Agreement or the
Letter of Credit are defined in Section 1 hereof.

 

SECTION 1.                                DEFINITIONS.

 

1.1.          Certain Definitions. The terms
hereinafter set forth when used herein shall have the following meanings:

 

“ABR”
means a fluctuating rate of interest equal to the higher of (a) the Prime Rate
or (b) the sum of the Federal Funds Effective Rate most recently determined by
the Agent, plus one-half percent (1/2%) per annum.

 

“ABR
Portion” shall have the meaning specified in Section 3.1 hereof.

 

“Adjusted
LIBOR Rate” means a rate per annum determined pursuant to the following
formula:

 

	
  Adjusted LIBOR Rate =

  	
  LIBOR Rate

  	
   

  
	
   

  	
  1 – Reserve Percentage

  	
   

  

 

“Affiliate”
shall mean, for any Person, any other Person that directly or indirectly
controls, or is under common control with, or is controlled by, such Person. As
used in this definition, “control” means the power, directly or indirectly, to
direct or cause the direction of management or policies of a Person (through
ownership of voting securities, by contract or otherwise), provided that, in
any event for purposes of this definition any Person that owns directly or
indirectly securities having ten percent (10%) or more of the ordinary voting
power for the election of directors of a corporation or ten percent (10%)

 

4

 

or more of the partnership or other ownership interests of any other
Person will be deemed to control such corporation or other Person.

 

“Agent”
shall have the meaning specified in the first paragraph of this Agreement.

 

“Agreement”
shall mean this First Amended and Restated Credit Agreement as may be supplemented
and amended from time to time.

 

“Applicable
Margin” shall mean on any date, (a) when used to determine the interest payable
on Loans comprising any LIBOR Portion or ABR Portion, the applicable number of
basis points set forth in the Pricing Schedule attached hereto as
Exhibit B and incorporated herein by reference under the heading for “Applicable
Margin for LIBOR Portions” or “Applicable Margin for ABR Portions,” as the case
may be, and (b) when used to determine the Facility Fee, the Utilization Fee or
the Letter of Credit Fee, the applicable number of basis points set forth in
such Pricing Schedule under such respective titles.

 

“Bank”
and “Banks” shall have the meanings specified in the first paragraph of this
Agreement.

 

“Borrowing”
shall have the meaning set forth in Section 2.2 hereof.

 

“Business
Day” shall mean any day, except Saturday or Sunday, on which banks are open for
business in Kansas City, Missouri or Chicago, Illinois, and, with respect to
LIBOR Portions, dealing in United States dollar deposits in London, England.

 

“Change
of Control” shall mean the occurrence after the date of this Agreement of:  (i) any Person, or two or more Persons
acting in concert, acquiring beneficial ownership (within the meaning of Rule
13d-3 of the Securities and Exchange Commission under the Securities Exchange
Act of 1934, as amended), directly or indirectly, of securities of the Company
(or other securities convertible into such securities) representing greater
than thirty-three and one-third percent (331/3%) of the
combined voting power of all securities of the Company entitled to vote in the
election of directors; or (ii) any Person, or two or more Persons acting in
concert, acquiring by contract or otherwise, or entering into a contract or
arrangement which, upon consummation, will result in its or their acquisition
of, or control over, securities of the Company (or other securities convertible
into such securities) representing greater than thirty-three and one-third
percent (331/3%) of the combined voting power of all
securities of the Company entitled to vote in the election of directors.

 

“Closing
Date” shall mean March 14, 2006.

 

“Commitment”
shall mean a Revolving Credit Commitment and a Letter of Credit Commitment of
any Bank.

 

“Commitment
Percentage” shall mean a Revolving Credit Percentage or a Letter of Credit
Commitment Percentage, as applicable.

 

“Credit”
shall have the meaning specified in the first paragraph of this Agreement.

 

“Credit
Termination Date” shall have the meaning set forth in Section 2.1 hereof.

 

“EBITDA”
means, with reference to any period, Net Income for such period plus all
amounts deducted in arriving at such Net Income amount in respect of
(a) Interest Charges for such period, plus (b) foreign, federal, state and
local income taxes of the Company, and its Subsidiaries paid or accrued for
such period, plus (c) all amounts properly charged by the Company and its
Subsidiaries for depreciation and amortization of intangible assets during such
period.

 

5

 

“Effective
Date” shall mean the later of (i) the Closing Date or (ii) if required, the
date as of which the Company receives the approval of the Kansas Corporation
Commission to enter into this Agreement.

 

“Environmental
Laws” shall mean all federal, state and local environmental, health and safety
statutes and regulations, including without limitation all statutes and
regulations establishing quality criteria and standards for air, water, land
and toxic or hazardous wastes and substances.

 

“ERISA”
shall mean the Employee Retirement Income Security Act of 1974, as amended.

 

“Event
of Default” shall mean any event or condition identified as such in
Section 8.1 hereof.

 

“Exposure”
shall mean, as to any Bank, the sum of such Bank’s (a) unused Revolving
Credit Commitment and unused Letter of Credit Commitment, if any, and
(b) all outstanding Loans, if any.

 

“Federal
Funds Effective Rate” shall mean for any day, an interest rate per annum equal
to the weighted average of the rates on overnight federal funds transactions
with members of the Federal Reserve System arranged by federal funds brokers,
as published for such day by the Federal Reserve Bank of New York, or if such
rate is not so published for such day, the average of the quotations for such
day on such transactions received by the Agent from three (3) federal funds
brokers of recognized standing selected by it.

 

“GAAP”
shall mean generally accepted accounting principles as in effect on the date
hereof applied by the Company on a basis consistent with the preparation of the
Audit Report referred to in Section 6.3 hereof.

 

“Granting
Bank” shall have the meaning set forth in Section 11.21.

 

“Indebtedness”
shall mean as of any time the same is to be determined, the aggregate of:

 

(a)           all indebtedness with
respect to borrowed money;

 

(b)           all reimbursement and other
obligations with respect to letters of credit, banker’s acceptances, customer
advances and other extensions of credit whether or not representing obligations
for borrowed money;

 

(c)           the aggregate amount of
capitalized lease obligations;

 

(d)           all indebtedness secured by
any lien or any security interest on any Property, whether or not the same
would be classified as a liability on a balance sheet;

 

(e)           all indebtedness representing
the deferred purchase price of Property, but excluding all trade payables
incurred in the ordinary course of business; and

 

(f)            all guaranties, endorsements
(other than any liability arising out of the endorsement of items for deposit
or collection in the ordinary course of business) and other contingent
obligations in respect of, or any obligations to purchase or otherwise acquire,
any of the foregoing.

 

Indebtedness of the Company
shall be computed and determined, without duplication, on a consolidated basis
for the Company and its Subsidiaries after the elimination of

 

6

 

intercompany items in
accordance with GAAP. No portion of the Stated Amount of the Letter of Credit
shall be included in the computation of Indebtedness except to the extent of
any Letter of Credit Loan.

 

“Interest
Charges” shall mean, with reference to any period, the sum of all interest
charges (including imputed interest charges with respect to capitalized lease
obligations, all amortization of debt discount and expense) of the Company and
its Subsidiaries for such period determined on a consolidated basis in
accordance with GAAP.

 

“Interest
Coverage Ratio” shall mean, as of any time the same is to be determined, the
ratio of (a) EBITDA for the most recent four (4) fiscal quarters then ended to
(b) Interest Charges for such four (4) fiscal quarters.

 

“Interest
Period” shall mean (a) with respect to any LIBOR Portion, the period used for
the computation of interest commencing on the date the relevant LIBOR Portion
is made, continued or effected by conversion and concluding on the date one (1)
or two (2) months thereafter as selected by the Company in its notice as
provided herein; provided that all of the foregoing provisions relating to Interest
Periods are subject to the following:

 

(a)           if any Interest Period would
otherwise end on a day which is not a Business Day, that Interest Period shall
be extended to the next succeeding Business Day, unless in the case of an
Interest Period for a LIBOR Portion the result of such extension would be to
carry such Interest Period into another calendar month in which event such
Interest Period shall end on the immediately preceding Business Day;

 

(b)           no Interest Period may
extend beyond the Credit Termination Date;

 

(c)           the interest rate to be
applicable to each LIBOR Portion for each Interest Period shall apply from and
including the first day of such Interest Period to but excluding the last day
thereof; and

 

(d)           no Interest Period may be
selected if after giving effect thereto the Company will be unable to make a
principal payment scheduled to be made during such Interest Period without
paying part of a LIBOR Portion on a date other than the last day of the
Interest Period applicable thereto.

 

For purposes of determining
an Interest Period, a month means a period starting on one day in a calendar
month and ending on a numerically corresponding day in the next calendar month;
provided, however, if an Interest Period begins on the last day of a month or if
there is no numerically corresponding day in the month in which an Interest
Period is to end, then such Interest Period shall end on the last Business Day
of such month.

 

“L/C
Issuer” shall mean UMB Bank, N.A.

 

“Letter
of Credit” shall have the meaning specified in Section 2.4(a) hereof.

 

“Letter
of Credit Commitment” and “Letter of Credit Commitments” shall have the
meanings specified in Section 2.2 hereof.

 

“Letter
of Credit Commitment Percentage” shall have the meaning specified in Section
2.2 hereof.

 

“Letter
of Credit Fee” shall have the meaning specified in Section 4.3 hereof.

 

“Letter
of Credit Loans” shall have the meaning specified in Section 2.1 hereof.

 

7

 

“Letter
of Credit Note” or “Letter of Credit Notes” shall have the meanings specified
in Section 2.2 hereof.

 

“LIBOR
Index Rate” shall mean, for any Interest Period applicable to a LIBOR Portion,
the rate per annum (rounded upwards, if necessary, to the next higher one
hundred-thousandth of a percentage point) for deposits in U.S. Dollars for a
period comparable to such Interest Period, which appears on Telerate Page 3750
as of 11:00 a.m. (London, England time) on the day two (2) Business Days before
the commencement of such Interest Period.

 

“LIBOR
Portion” shall have the meaning specified in Section 3.1 hereof.

 

“LIBOR
Rate” shall mean for each Interest Period applicable to a LIBOR Portion,
(a) the LIBOR Index Rate for such Interest Period, if such rate is
available, and (b) if the LIBOR Index Rate cannot be determined, the arithmetic
average of the rates of interest per annum (rounded upwards, if necessary, to
the nearest 1/100 of 1%) at which deposits in U.S. dollars in immediately
available funds are offered to the Agent at 11:00 a.m. (London, England time)
two (2) Business Days before the beginning of such Interest Period by three
(3) or more major banks in the London interbank market selected by the
Agent for a period equal to such Interest Period and in an amount equal or
comparable to the principal amount of the LIBOR Portion scheduled to be made by
the Agent during such Interest Period.

 

“Loan”
shall mean either a Revolving Credit Loan or a Letter of Credit Loan and “Loans”
shall mean any two or more of the foregoing.

 

“Loan
Documents” shall mean this Agreement and any and all exhibits hereto and the
Notes.

 

“Material
Adverse Effect” shall have the meaning specified in Section 6.1 hereof.

 

“Mortgage”
shall have the meaning specified in Section 7.7(i) hereof.

 

“Net
Income” shall mean, with reference to any period, the net income (or net loss)
of the Company and its Subsidiaries for such period as computed on a
consolidated basis in accordance with GAAP.

 

“Note”
shall mean a Revolving Credit Note or a Letter of Credit Note and “Notes” shall
mean any two or more of the foregoing.

 

“PBGC”
shall mean the Pension Benefit Guaranty Corporation.

 

“Person”
shall mean and include any individual, sole proprietorship, partnership, joint
venture, trust, unincorporated organization, association, corporation, institution,
entity, party or government (whether federal, state, county, city, municipal,
or otherwise, including, without limitation, any instrumentality, division,
agency, body or department thereof).

 

“Plan”
shall mean any employee benefit plan covering any officers or employees of the
Company or any Subsidiary, any benefits of which are, or are required to be,
guaranteed by the PBGC.

 

“Prime
Rate” means for any day the rate of interest announced by UMB from time to time
as its prime commercial rate in effect on such day, with any change in the
Prime Rate resulting from a change in said prime commercial rate to be
effective as of the date of the relevant change in said prime commercial rate,
such rate not necessarily being the lowest rate charged by UMB to any customer.

 

8

 

“Property”
shall mean all assets and properties of any nature whatsoever, whether real or
personal, tangible or intangible, including, without limitation, intellectual
property.

 

“Quarterly
Compliance Certificate” shall have the meaning set forth in Section 7.4(c)
hereof.

 

“Register”
shall have the meaning specified in Section 11.20 hereof.

 

“Required
Banks” shall mean any Bank or Banks which in the aggregate hold at least
sixty-six and two-thirds percent (662/3%) of the Total
Exposure.

 

“Reserve
Percentage” means the daily arithmetic average maximum rate, expressed as a
decimal, at which reserves (including, without limitation, any supplemental,
marginal and emergency reserves) are imposed on members banks of the Federal
Reserve System during the applicable Interest Period by the Board of Governors
of the Federal Reserve System (or any successor) under Regulation D on “eurocurrency
liabilities” (as such term is defined in Regulation D), subject to any
amendments of such reserve requirement by such Board or its successor, taking
into account any transitional adjustments thereto. For purposes of this
definition, the LIBOR Portions shall be deemed to be eurocurrency liabilities
as defined in Regulation D without benefit or credit for any prorations,
exemptions or offsets under Regulation D.

 

“Revolving
Credit” shall have the meaning specified in the first paragraph of this
Agreement.

 

“Revolving
Credit Commitment” and “Revolving Credit Commitments” shall have the meanings
specified in Section 2.2 hereof.

 

“Revolving
Credit Commitment Percentage” shall have the meaning specified in Section 2.2
hereof.

 

“Revolving
Credit Loan” and “Revolving Credit Loans” shall have the meanings specified in
Section 2.1 hereof.

 

“Revolving
Credit Note” or “Revolving Credit Notes” shall have the meanings specified in
Section 2.2 hereof.

 

“SPC”
shall have the meaning set forth in Section 11.21.

 

“Stated
Amount” shall have the meaning specified in section 2.4(a) hereof.

 

“Subsidiary”
shall mean, for any Person, any corporation or other entity of which more than
fifty percent (50%) of the outstanding stock or comparable equity interests
having ordinary voting power for the election of the Board of Directors of such
corporation or similar governing body in the case of a non-corporate entity
(irrespective of whether or not, at the time, stock or other equity interests
of any other class or classes of such corporation or other entity shall have or
might have voting power by reason of the happening of any contingency) is at
the time directly or indirectly owned by such Person or by one or more of its
Subsidiaries

 

“Syndication
Agent” means Bank of America, N.A.

 

“Total
Assets” means all assets of the Company as shown on its most recent quarterly
or annual consolidated balance sheet, as determined in accordance with GAAP.

 

“Total
Exposure” shall mean the aggregate Exposure for all Banks.

 

“UMB”
shall have the meaning specified in the first paragraph of this Agreement.

 

9

 

1.2.          Interpretation. Capitalized
terms defined elsewhere in this Agreement shall, unless otherwise specified,
have the meanings so ascribed to them in all provisions of this Agreement or
the Letter of Credit. The foregoing definitions are equally applicable to both
the singular and plural forms of the terms defined. All references to time of
day herein are references to Kansas City, Missouri time unless otherwise
specifically provided. Where the character or amount of any asset or liability
or item of income or expense is required to be determined or any consolidation
or other accounting computation is required to be made for the purposes of this
Agreement, it shall be done in accordance with GAAP except where such principles
are inconsistent with the specific provisions of this Agreement.

 

SECTION 2.                                THE CREDIT.

 

2.1.          Loans. Subject to
all of the terms and conditions hereof, the Banks agree to extend the Credit to
the Company of up to Two Hundred Twenty-Six Million Dollars ($226,000,000), One
Hundred Fifty Million Dollars ($150,000,000) of which may be borrowed by the
Company in its discretion from time to time, be repaid and borrowed again (“Revolving
Credit Loans”), during the period from the Closing Date to and including July
15, 2010 (the “Credit Termination Date”) and up to Seventy-Six Million Dollars
($76,000,000) of which may be borrowed and repaid (“Letter of Credit Loans”)
only in accordance with Section 2.4 hereof and the terms of the Letter of
Credit Notes (no amounts may be repaid and reborrowed on the Letter of Credit
Notes). The aggregate amount of the Revolving Credit Loans outstanding at any
one time shall not exceed the Revolving Credit Commitments, as in effect from
time to time and the aggregate amount of the Letter of Credit Loans outstanding
at any one time shall not exceed the Letter of Credit Commitments, as in effect
from time to time.

 

2.2.          Revolving Credit Commitments and
Letter of Credit Commitments. The respective maximum
aggregate principal amounts of the Credit (which is subject to reduction
pursuant to Section 4.6 hereof) at any one time separately for Revolving Credit
Loans and for Letter of Credit Loans outstanding and the percentage for each of
the Credit available at any time which each Bank agrees to make available to
the Company (its “Revolving Credit Commitment Percentage” or “Letter of Credit
Commitment Percentage,” as the case may be) are as follows (collectively, the “Revolving
Credit Commitments” and individually, a “Revolving Credit Commitment” and
collectively, the “Letter of Credit Commitments” and individually, a “Letter of
Credit Commitment,” as the case may be):

 

Revolving
Credit Commitments

 

	
  UMB Bank, N.A.

  	
   

  	
  $

  	
  25,000,000

  	
   

  	
  16.67

  	
  %

  
	
  Bank of America, N.A.

  	
   

  	
  $

  	
  22,000,000

  	
   

  	
  14.67

  	
  %

  
	
  M&I Marshall & Ilsley Bank

  	
   

  	
  $

  	
  22,000,000

  	
   

  	
  14.67

  	
  %

  
	
  National City Bank of the Midwest

  	
   

  	
  $

  	
  22,000,000

  	
   

  	
  14.67

  	
  %

  
	
  U.S. Bank, National Association

  	
   

  	
  $

  	
  22,000,000

  	
   

  	
  14.67

  	
  %

  
	
  Wells Fargo Bank, N.A.

  	
   

  	
  $

  	
  22,000,000

  	
   

  	
  14.67

  	
  %

  
	
  Comerica Bank

  	
   

  	
  $

  	
  15,000,000

  	
   

  	
  10.00

  	
  %

  
	
  TOTAL

  	
   

  	
  $

  	
  150,000,000

  	
   

  	
  100.00

  	
  %

  

 

Letter of
Credit Commitments

 

	
  UMB Bank, N.A.

  	
   

  	
  $

  	
  12,654,000

  	
   

  	
  16.65

  	
  %

  
	
  Bank of America, N.A.

  	
   

  	
  $

  	
  11,149,200

  	
   

  	
  14.67

  	
  %

  
	
  M&I Marshall & Ilsley Bank

  	
   

  	
  $

  	
  11,149,200

  	
   

  	
  14.67

  	
  %

  
	
  National City Bank of the Midwest

  	
   

  	
  $

  	
  11,149,200

  	
   

  	
  14.67

  	
  %

  
	
  U.S. Bank, National Association

  	
   

  	
  $

  	
  11,149,200

  	
   

  	
  14.67

  	
  %

  
	
  Wells Fargo Bank, N.A.

  	
   

  	
  $

  	
  11,149,200

  	
   

  	
  14.67

  	
  %

  
	
  Comerica Bank

  	
   

  	
  $

  	
  7,600,000

  	
   

  	
  10.00

  	
  %

  
	
  TOTAL

  	
   

  	
  $

  	
  76,000,000

  	
   

  	
  100.00

  	
  %

  
	
  TOTAL COMMITMENTS:

  	
   

  	
  $

  	
  226,000,000

  	
   

  	
   

  	
   

  

 

10

 

The
obligations of the Banks hereunder are several and not joint and no Bank shall
under any circumstances be obligated to extend credit under the Credit in
excess of its Revolving Credit Commitment, its Letter of Credit Commitment or
its applicable Commitment Percentage of credit outstanding under the Credit.

 

All
Loans made by the Banks on the same date are hereinafter referred to as a “Borrowing.”  Each Borrowing on a Revolving Credit Loan
shall be in a minimum amount as provided in Section 3.5 hereof and each
Borrowing shall be made pro rata by the Banks in accordance with their
respective applicable Commitment Percentages. All Loans made by each Bank shall
be evidenced by a Revolving Credit Note or a Letter of Credit Note of the
Company (individually a “Revolving Credit Note” and collectively the “Revolving
Credit Notes” or a “Letter of Credit Note” and collectively, “Letter of Credit
Notes,” as the case may be) payable to the order of such Bank in the amount of
its Revolving Credit Commitment or its Letter of Credit Commitment, each
Revolving Credit Note to be in the form (with appropriate insertions) attached
hereto as Exhibit A-1 and each Letter of Credit Note to be in the form (with
appropriate insertions) attached hereto as Exhibit A-2. Without regard to the
face principal amount of each Note, the actual principal amount at any time
outstanding and owing by the Company on account thereof during the period
ending on the Credit Termination Date shall be the sum of all advances then or
theretofore made thereon less all principal payments actually received thereon
during such period.

 

2.3.          Procedure For Borrowing on
Revolving Credit Notes. The Company shall notify the Agent (which
may be written or oral, but which must be given prior to 11:00 a.m. (Kansas
City time)) of the date (which may, subject to the immediately preceding
parenthetical and Section 3 hereof, be the date on which such notice is given)
upon which it requests that any advance be made to it under the Revolving
Credit Commitments, and the Agent shall promptly (but in any event not later
than 2:00 p.m. Kansas City time) notify each Bank in writing of its receipt of
each such notice. Subject to all of the terms and conditions hereof, each Bank
shall make available to the Agent its share of each advance, and the proceeds
of each advance, to the extent received by the Agent from the Banks, shall be
made available to the Company at the office of the Agent in Kansas City and in
funds there current. Each Loan from each Bank shall initially constitute part
of an ABR Portion except to the extent the Company has otherwise timely elected
a LIBOR Portion, all as provided in Section 3 hereof. Unless the Agent
shall have been notified by a Bank prior to the date a Loan is to be made by
such Bank hereunder that such Bank does not intend to make its pro rata share
of such Loan available to the Agent, the Agent may assume that such Bank has
made such share available to the Agent on such date and the Agent may in
reliance upon such assumption (but shall not be required to) make available to
the Company a corresponding amount. If such corresponding amount is not in fact
made available to the Agent by such Bank and the Agent has made such amount
available to the Company, the Agent shall be entitled to receive such amount
from such Bank forthwith upon its demand (or, if such Bank fails to pay such
amount forthwith upon such demand, to recover such amount, together with
interest thereon at the rate otherwise applicable thereto under Section 3
hereof, from the Company), together with interest thereon in respect of each
day during the period commencing on the date such amount was made available to
the Company and ending on but excluding the date the Agent recovers such amount
at the Federal Funds Effective Rate for each day as determined by the Agent (or
in the case of a day which is not a Business Day, then for the preceding
Business Day). Nothing in this Section 2.3 shall be deemed to permit any
Bank to

 

11

 

breach
its obligations to make Loans under this Agreement or to limit the Company’s
claims against any Bank for such breach.

 

2.4.          Letter of Credit.

 

(a)           General Terms. Subject to
the terms and conditions hereof, as part of the Credit, the L/C Issuer shall
issue an irrevocable, standby letter of credit in the form of Exhibit G
attached hereto (the “Letter of Credit”) for the account of the Company to LSP
Services Plum Point, LLC, as Project Management Company (“Beneficiary”), in an
initial aggregate undrawn face amount of up to Seventy-Six Million Dollars
($76,000,000) (the “Stated Amount”) as the same may be reduced from time to
time in accordance with the terms of the Letter of Credit. The Letter of Credit
may be transferred one or more times by the Beneficiary or its transferee or
transferees who may also direct the L/C Issuer on a case-by-case basis, as set
forth in the Letter of Credit, to not effect any scheduled reduction. The
Letter of Credit shall be issued by the L/C Issuer, but each Bank shall be
obligated to reimburse the L/C Issuer for such Bank’s Letter of Credit
Commitment Percentage of the amount of each drawing thereunder and,
accordingly, each drawing on the Letter of Credit shall constitute usage of the
Letter of Credit Commitment of each Bank pro rata in an amount equal to its
Letter of Credit Commitment Percentage.

 

(b)           Application. Upon
execution hereof, the Company shall execute an application in the form of
Exhibit H attached hereto (the “Application”). In the event of any conflict between
the terms of the Application and the terms of this Agreement, the terms of this
Agreement shall control. Notwithstanding anything contained in the Application
to the contrary:  (i) the Company shall
pay fees in connection with the Letter of Credit as set forth in Sections 4.1
and 4.2 hereof, and (ii) the L/C Issuer will not call for the funding by the
Company of any amount under the Letter of Credit before being presented with a
drawing thereunder. Unless all of the Banks instruct the L/C Issuer otherwise,
the L/C Issuer will give notice of non-extension before the time necessary to
prevent an automatic extension of the Letter of Credit if before such required
notice date (i)  the expiration date of
the Letter of Credit if so extended would be after the Credit Termination Date,
(ii) the Commitments have been terminated, or (iii) an Event of Default exists
and the Agent, at the request or with the consent of the Required Banks, has
given the L/C Issuer instructions not to so permit the extension of the expiration
date of the Letter of Credit.

 

(c)           Reimbursement Obligations. Unless the
Company advises the L/C Issuer that it desires to directly pay any drawing on
the Letter of Credit, all drawings on the Letter of Credit shall be deemed to
be requests for Letter of Credit Loans and a Letter of Credit Loan shall be
made in the amount of and on the date of each such drawing. Each Letter of
Credit Loan from each Bank shall initially bear interest at the ABR until and
unless the Company makes a timely election for such Loan to bear interest at a
LIBOR rate as provided in Section 3 hereof. The obligation of the Company
to reimburse the L/C Issuer for all drawings under the Letter of Credit (“Reimbursement
Obligations”) shall be governed by the Application subject to the terms of the
Letter of Credit Note, except that if the Company desires to pay any drawing on
the Letter of Credit directly and not have such Letter of Credit deemed to be a
request for a Letter of Credit Loan, reimbursement shall be made by the Company
no later than 2:00 p.m. (Kansas City time) on the date when each drawing is to
be paid if the Company has been informed of such drawing by the L/C Issuer on
or before 11:30 a.m. (Kansas City time) on the date when such drawing is to be
paid or, if notice of such drawing is given to the Borrower after 11:30 a.m.
(Kansas City time) on the date when such drawing is to be paid, by 2:00 p.m.
(Kansas City time) on the following Business Day, in immediately available
funds at the Agent’s principal office in Kansas City, Missouri, or such other
office as the Agent may designate in writing to the Company. If the Company
does not make any such reimbursement payment on the date due and the Banks fund
their participations therein in the manner set forth in Section 2.4(d) below,
then all payments thereafter received by the

 

12

 

Agent in discharge of the
relevant Reimbursement Obligations shall be distributed in accordance with
Section 2.4(d) below.

 

In the event the expiration
date of the Letter of Credit extends beyond the Credit Termination Date for any
reason and the maturity date of this Agreement is not extended or renewed, the
Company shall, not later than the Credit Termination Date, or if an Event of
Default has occurred and is occurring, not later than the fifth (5th) Business
Day following a request by the Agent, at the direction of the Required Banks,
deposit with the Agent and pledge to the Banks cash or cash equivalents equal
to One Hundred Percent (100%) of the Available Amount of the Letter of Credit
then in effect in a form and substance and subject to documentation reasonably
acceptable to the Agent. Such cash and cash equivalents shall be held by Agent
in a cash collateral account (the “Cash Collateral Account”) maintained by the
Agent. The Cash Collateral Account shall be in the name of Company and shall be
pledged to, and subject to the control of the Agent for the benefit of Agent
and the Banks, in a manner reasonably satisfactory to Agent. The Company hereby
pledges and grants to Agent, on behalf of itself and the Banks, a security
interest in all such cash and cash equivalents held in the Cash Collateral
Account from time to time and all proceeds thereof, as security for the payment
of all amounts due in respect of the obligations under the Letter of Credit. All
such cash and cash equivalents in the Cash Collateral Account shall be released
to the Company upon the cure of any such Events of Default. This paragraph
shall constitute a security agreement under applicable law.

 

(d)           Participating Interests. Each Bank
(other than the Bank acting as L/C Issuer in issuing the Letter of Credit), by
its acceptance hereof, severally agrees to purchase from the L/C Issuer, and
the L/C Issuer hereby agrees to sell to each such Bank, an undivided percentage
participating interest, to the extent of each Bank’s Letter of Credit
Commitment Percentage, in the Letter of Credit issued by, and each
Reimbursement Obligation owed to, the L/C Issuer. Upon any failure by the
Company to pay any Reimbursement Obligation at the time required, as set forth
in Section 2.4(c) above, or if the L/C Issuer is required at any time to return
to the Company or to a trustee, receiver, liquidator, custodian or other Person
any portion of any payment of any Reimbursement Obligation, each Bank shall,
not later than the Business Day it receives a certificate in the form of
Exhibit I attached hereto from the L/C Issuer (with a copy to the Agent) to
such effect, if such certificate is received before 2:00 p.m. (Kansas City
time), or not later than 2:00 p.m. (Kansas City time) the following
Business Day, if such certificate is received after such time, pay to the Agent
for the account of the L/C Issuer an amount equal to such Bank’s Letter of
Credit Commitment Percentage of such unpaid or recaptured Reimbursement
Obligation together with interest on such amount accrued from the date the
related payment was made by the L/C Issuer to the date of such payment by such
Bank at a rate per annum equal to the Federal Funds Effective Rate for each
such day. Each such Bank shall thereafter be entitled to receive its Letter of
Credit Commitment Percentage of each payment received in respect of the
relevant Reimbursement Obligation and of interest paid thereon, with the L/C
Issuer retaining its Letter of Credit Commitment Percentage thereof as a Bank
hereunder. The several obligations of the Banks to the L/C Issuer under this
Section 2.4 shall be absolute, irrevocable, and unconditional under any and all
circumstances whatsoever and shall not be subject to any set-off, counterclaim
or defense to payment which any Bank may have or have had against the Company,
the L/C Issuer, the Agent, any Bank or any other Person whatsoever. Without
limiting the generality of the foregoing, such obligations shall not be
affected by any Default or Event of Default or by any reduction or termination
of any Commitment of any Bank, and each payment by a Bank under this Section
2.4 shall be made without any offset, abatement, withholding or reduction
whatsoever.

 

(e)           Indemnification. The Banks
shall, to the extent of their respective Letter of Credit Commitment
Percentages, indemnify the L/C Issuer (to the extent not reimbursed by the
Company) against any cost, expense (including reasonable counsel fees

 

13

 

and
disbursements), claim, demand, action, loss or liability (except such as result
from the L/C Issuer’s gross negligence or willful misconduct) that the L/C
Issuer may suffer or incur in connection with the Letter of Credit issued by it.
The obligations of the Banks under this Section 2.4(e) and all other parts of
this Section 2.4 shall survive termination of this Agreement and of the
Application, the Letter of Credit, and all drafts and other documents presented
in connection with drawings thereunder.

 

SECTION 3.           INTEREST.

 

3.1.          Elections. Subject to
all of the terms and conditions of this Section 3, portions of the principal
indebtedness evidenced by the Notes (all of the indebtedness evidenced by the
Notes bearing interest at the same rate for the same period of time being
hereinafter referred to as a “Portion”) may, at the election of the Company,
bear interest with reference to the ABR (the “ABR Portions”) or with reference
to the Adjusted LIBOR Rate (“LIBOR Portions”), and Portions may be converted
from time to time from one basis to the other. All of the indebtedness
evidenced by the Notes which is not part of a LIBOR Portion shall constitute a
single ABR Portion. All of the indebtedness evidenced by the Notes which bears
interest with reference to a particular Adjusted LIBOR Rate for a particular
Interest Period shall constitute a single LIBOR Portion. The Company promises
to pay interest on each Portion at the rates and times specified in this
Section 3. Each Bank holding a Note shall have a ratable interest in each
Portion evidenced thereby.

 

3.2.          ABR Portions. Each ABR
Portion shall bear interest (which the Company promises to pay at the times
herein provided), at the rate per annum equal to the ABR as in effect from time
to time plus the Applicable Margin, as determined from time to time under the
Pricing Schedule set forth in Exhibit B attached hereto and hereby incorporated
by reference, provided that upon the occurrence of an Event of Default
hereunder such Portion shall, upon written notice from the Agent, bear interest
(which the Company promises to pay at the times hereinafter provided), whether
before or after judgment, for the period from the date such Event of Default
occurred and during the continuation thereof, at the rate per annum determined
by adding two percent (2%) to the interest rate which would otherwise be
applicable thereto from time to time. Interest on the ABR Portions shall be
payable in arrears on the last day of each calendar quarter in each year, upon
prepayment of any ABR Portion and at maturity of the applicable Notes and
default interest shall be due and payable upon demand.

 

3.3.          LIBOR Portions. Each LIBOR
Portion shall bear interest (which the Company promises to pay at the times
herein provided) for each Interest Period selected therefor at a rate per annum
equal to the Adjusted LIBOR Rate for such Interest Period plus the Applicable
Margin, as determined from time to time under the Pricing Schedule set forth in
Exhibit B attached hereto, provided that upon the occurrence of an Event of
Default hereunder such Portion shall, upon written notice from the Agent, bear
interest (which the Company promises to pay at the times hereinafter provided)
whether before or after judgment, for the period from the date such Event of
Default occurred and during the continuation thereof, through the end of the
Interest Period then applicable thereto at the rate per annum determined by
adding two percent (2%) to the interest rate otherwise applicable thereto, and
effective at the end of such Interest Period such LIBOR Portion shall
automatically be converted into and added to the applicable ABR Portion and
shall thereafter bear interest at the interest rate applicable to the applicable
ABR Portion after default. Interest on each LIBOR Portion shall be due and
payable on the last day of each Interest Period applicable thereto and, at
maturity of the applicable Notes, and default interest shall be due and payable
upon demand. The Company shall notify the Agent on or before 11:00 a.m. (Kansas
City time) on the third Business Day preceding the end of an Interest Period
applicable to a LIBOR Portion whether such LIBOR Portion (or any portion
thereof) is to continue as a LIBOR Portion, in which event the Company shall
notify the Agent of the new Interest Period selected therefor, and in the event
the Company shall fail to so notify the Agent, such LIBOR Portion shall
automatically be converted into and added to the applicable ABR Portion as of
and on the last day of such Interest Period. The Agent shall promptly notify
each Bank of each notice received from the Company pursuant to the foregoing
provisions. Anything contained herein to the contrary notwithstanding, the
obligation of the Banks to create, continue

 

14

 

or
effect by conversion any LIBOR Portion shall be conditioned upon the fact that
at such time no Event of Default shall have occurred and be continuing.

 

3.4.          Computation. Interest on
the LIBOR Portions and all fees, charges and commissions due hereunder shall be
computed on the basis of a year of three hundred sixty (360) days for the
actual number of days elapsed. All other interest on the Notes shall be
computed on the basis of a year of 365/366 days for the actual number of days
elapsed unless otherwise specifically provided in this Agreement.

 

3.5.          Minimum Amounts. Each ABR
Portion evidenced by Revolving Credit Notes shall be in a minimum amount of
$1,000,000 or such greater amount which is an integral multiple of $250,000. Each
LIBOR Portion evidenced by Revolving Credit Notes shall be in a minimum amount
of $5,000,000 or such greater amount which is an integral multiple of
$1,000,000.

 

3.6.          Manner of Rate Selection. The Company
shall notify the Agent by 11:00 a.m. (Kansas City time) at least three (3)
Business Days prior to the date upon which it requests that any LIBOR Portion
be created or continued or that any part of a ABR Portion be converted into a
LIBOR Portion (such notice to specify in each instance the amount thereof and
the Interest Period selected therefor) and the Agent shall promptly advise each
Bank of each such notice. If any request is made to convert a LIBOR Portion
into an ABR Portion, such conversion shall only be made so as to become
effective as of the last day of the Interest Period applicable thereto. All
requests for the creation, continuance or conversion of Portions under this
Agreement shall be irrevocable. Such requests may be written or oral and the
Agent is hereby authorized to honor telephonic requests for creations,
continuances and conversions received by it from any person purporting to be a
person authorized to act on behalf of the Company hereunder, the Company hereby
indemnifying the Agent and the Banks from any liability or loss ensuing from so
acting.

 

3.7.          Lawful Rate. All
agreements between the Company, the Agent and each of the Banks, whether now
existing or hereafter arising and whether written or oral, are expressly
limited so that in no event whatsoever, whether by reason of demand or
acceleration of the maturity of any of the indebtedness hereunder or otherwise,
shall the amount contracted for, charged, received, reserved, paid or agreed to
be paid to the Agent or each Bank for the use, forbearance, or detention of the
funds advanced hereunder or otherwise, or for the performance or payment of any
covenant or obligation contained in any Loan Document, exceed the highest
lawful rate permissible under applicable law (the “Highest Lawful Rate”), it
being the intent of the Company, the Agent and each of the Banks in the
execution hereof and of the Loan Documents to contract in strict accordance
with any applicable usury laws, if any. If, as a result of any circumstances
whatsoever, performance by the Company of any provision hereof or of any of
such documents, at the time performance of such provision shall be due, shall
involve exceeding the limits of applicable usury laws or result in the Agent or
any Bank having or being deemed to have contracted for, charged, reserved or
received interest (or amounts deemed to be interest) in excess of the maximum,
lawful rate or amount of interest allowed by applicable law to be so contracted
for, charged, reserved or received by the Agent or such Bank, then the
obligation to be performed by the Company shall be reduced to the legal limit
of such performance, and if, from any such circumstance, the Agent or such Bank
shall ever receive interest or anything of value which might be deemed interest
under applicable law which would exceed the Highest Lawful Rate, such amount
which would be unlawful interest shall be refunded to the Company or, if
permitted by applicable law and such unlawful interest does not exceed the
unpaid principal balance of the Notes and the amounts owing on other
obligations of the Company to the Agent or any Bank under any Loan Document
such unlawful interest may be applied to the reduction of the principal amount
owing on the Notes or the amounts owing on other obligations of the Company to
the Agent or any Bank under any Loan Document. All interest paid or agreed to
be paid to the Agent or any Bank shall, to the extent permitted by applicable
law, be amortized, prorated, allocated, and spread throughout the full period
of the indebtedness hereunder until payment in full of the principal of the
indebtedness hereunder (including the period of any renewal or extension
thereof) so that the interest on account of the indebtedness hereunder for such
full period shall not exceed the highest amount permitted by

 

15

 

applicable
law. This Section 3.7 shall control all agreements between the Company, the
Agent and the Banks.

 

SECTION 4.                                FEES, PREPAYMENTS, TERMINATIONS AND APPLICATION OF PAYMENTS.

 

4.1.          Facility Fee. For the
period from the Closing Date to and including the Credit Termination Date, or
such earlier date on which the Credit is terminated in whole pursuant to
Section 4.6 or any other provision hereof, the Company shall pay to the Agent
for the account of the Banks, a facility fee with respect to the Credit at the
rate per annum as determined from time to time under the Pricing Schedule set
forth in Exhibit B attached hereto, multiplied by the aggregate amount of all
of the Revolving Credit Commitments and the Letter of Credit Commitments
(calculated in each case after giving effect to any reductions thereof as
specified in Section 4.6 hereof and as if no Loans are outstanding hereunder). Such
fee shall be payable in arrears on the last day of each July, October, January
and April, and on the Credit Termination Date, unless the Credit is terminated
in whole on an earlier date, in which event the fees for the period from the
date of the last payment made pursuant to this Section 4.1 through the
effective date of such termination in whole shall be paid on the date of such
earlier termination in whole.

 

4.2.          Utilization Fee. For the
period from the Closing Date to and including the Credit Termination Date, or
such earlier date on which the Credit is terminated in whole pursuant to
Section 4.6 or any other provision hereof, the Company shall pay to the
Agent for the account of the Banks a utilization fee with respect to the Credit
at the rate per annum as determined from time to time under the Pricing
Schedule set forth in Exhibit B attached hereto, multiplied by the aggregate
amount of all of the Revolving Credit Commitments and all of the Letter of
Credit Commitments (calculated after giving effect to any reductions thereof as
specified in Section 4.6 hereof and as if no Loans are outstanding hereunder)
on any date on which the outstanding Loans for all the Banks are greater than
thirty-three percent (33%) of the total Commitments. Such fee shall be payable
in arrears on the last day of each July, October, January and April, and on the
Credit Termination Date, unless the Credit is terminated in whole on an earlier
date, in which event the fees for the period from the date of the last payment
made pursuant to this Section 4.2 through the effective date of such
termination in whole shall be paid on the date of such earlier termination in
whole.

 

4.3.          Letter of Credit Fees. Quarterly in
arrears, on the last day of each July, October, January and April, commencing
on the first such date occurring after the date hereof, the Company shall pay
to the Administrative Agent, for the ratable benefit of the Lenders in
accordance with their Letter of Credit Commitment Percentages, a letter of
credit fee (the “Letter of Credit Fee”) at a rate per annum equal to the Applicable
Margin (computed on the basis of a year of 360 days and the actual number of
days elapsed) in effect during each day of such quarter applied to the daily
average face amount of the Letter of Credit outstanding during such quarter. In
addition, the Company shall pay to the L/C Issuer for its own account the L/C
Issuer’s standard drawing, negotiation, amendment, and other administrative
fees for issuing the Letter of Credit as agreed by the Company and the L/C
Issuer from time to time.

 

4.4.          Agent’s Fee. The Company
shall pay to and for the sole account of the Agent such fees as the Company and
the Agent may agree upon in writing from time to time. Such fees shall be in
addition to any fees and charges the Agent may be entitled to receive hereunder
or under the other Loan Documents.

 

16

 

4.5.          Prepayments.

 

(a)           Optional Prepayments of ABR
Portions. The Company shall have the privilege of prepaying
without premium or penalty and in whole or in part (but if in part, then in a
minimum principal amount of $1,000,000) the ABR Portion of any Loan at any time
upon prior telecopy or telephonic notice from the Company to the Agent on or
before 11:00 a.m. (Kansas City time) on the Business Day immediately preceding
such prepayment.

 

(b)           Optional Prepayments of LIBOR
Portions. The Company may prepay any LIBOR Portion, upon
written or telephonic notice (which telephonic notice shall be promptly
confirmed in writing by facsimile communication, telex or telegraph) by no
later than 11:00 a.m. (Kansas City time) on the third Business Day immediately
preceding the date of such prepayment from the Company to the Agent, such
prepayment to be made by the payment of the principal amount to be prepaid and
accrued interest thereon and any compensation required by Section 9.4 hereof,
if applicable; provided, however, that any such prepayment in part shall be in
a principal amount of no less than $5,000,000 or such greater amount which is
an integral multiple of $1,000,000.

 

(c)           Mandatory Prepayments of Excess
Borrowings. If the outstanding principal amount of all
Revolving Credit Loans shall ever exceed the aggregate amount of all Revolving
Credit Commitments in effect from time to time or the outstanding principal
amount of all Letter of Credit Loans shall ever exceed the maximum principal
amount of all Letter of Credit Commitments in effect from time to time for any
reason, the Company shall immediately prepay Revolving Credit Loans and/or
Letter of Credit Loans, as the case may be, in such amount as shall be
necessary to eliminate such excess.

 

4.6.          Credit Reductions. The Company
shall have the right at any time upon ten (10) Business Days’ prior notice to
the Agent, which shall promptly give notice to the Banks, to reduce the Revolving
Credit in whole or in part (but if in part, in a minimum principal amount of
$5,000,000 or such greater amount which is an integral multiple of $5,000,000);
provided, however, that the Company may not reduce any portion of the Revolving
Credit which represents outstanding Revolving Credit Loans. Each such reduction
in part shall automatically terminate each Bank’s Revolving Credit Commitment
by an amount equal to its Revolving Credit Commitment Percentage of the amount
of the reduction. The maximum amount of the Letter of Credit Loans which may be
outstanding shall be automatically reduced by the amounts and on the dates set
forth in the Letter of Credit. Each such reduction in part shall automatically
terminate each Bank’s Letter of Credit Commitment by an amount equal to its
Letter of Credit Commitment Percentage of the amount of the reduction. Each
Bank’s Letter of Credit Commitment shall also be reduced by the amount of any
payment of outstanding Letter of Credit Loans prior to the date upon which payment
thereof is due.

 

4.7.          Place and Application of Payments. All payments
by the Company hereunder shall be made to the Agent at its office at 1010 Grand
Boulevard, Kansas City, Missouri 64106 and in immediately available funds,
prior to 2:00 p.m. (Kansas City time) on the date of such payment. Subject to
Section 11.18 of this Agreement, all such payments shall be made without setoff
or counterclaim and without reduction for, and free from, any and all present
and future levies, imposts, duties, fees, charges, deductions withholdings,
restrictions or conditions of any nature imposed by any government or any
political subdivision or taxing authority thereof. Any payments received after
2:00 p.m. (Kansas City time) shall be deemed received upon the following
Business Day. The Agent shall remit to each Bank its proportionate share of
each payment of principal, interest and fees, owed to it, received by the Agent
by 2:00 p.m. (Kansas City time) on the same day of its receipt and its
proportionate share of each such payment received by the Agent after 2:00 p.m.
(Kansas City time) on the Business Day following its receipt by the Agent. In
the event the Agent does not remit any amount to any Bank when required by the
preceding sentence, the Agent shall pay to such Bank interest on such amount
until paid at a rate per annum equal to the Federal Funds Effective Rate. Should
the Company be late in making any required payment hereunder, the Company
hereby authorizes the Agent to

 

17

 

automatically
debit any of its accounts with UMB for any principal, interest and fees when
due under the Notes or this Agreement and to transfer the amount so debited
from such account to the Agent for application as herein provided. The Agent
shall notify the Company by telephonic notice confirmed in writing of any such
debit.

 

4.8.          Capital Adequacy. If, after the
Closing Date, any Bank or the Agent shall have determined in good faith that
the adoption after such date of any applicable law, rule or regulation
regarding capital adequacy, or any change therein (including, without
limitation, any revision in the Final Risk-Based Capital Guidelines of the
Board of Governors of the Federal Reserve System (12 CFR Part 208, Appendix A;
12 CFR Part 225, Appendix A) or of the Office of the Comptroller of the
Currency (12 CFR Part 3, Appendix A), or in any other applicable capital rules
heretofore adopted and issued by any governmental authority), or any change in
the interpretation or administration thereof by any governmental authority,
central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by any Bank with any request or directive
regarding capital adequacy (whether or not having the force of law) of any such
authority, central bank or comparable agency, has or would have the effect of
reducing the rate of return on such bank’s capital, or on the capital of any
corporation controlling such Bank, in each case as a consequence of its
obligations hereunder, to a level below that which such Bank would have
achieved but for such adoption, change or compliance (taking into consideration
such Bank’s policies with respect to capital adequacy) by an amount deemed by
such Bank to be material, then from time to time, within thirty (30) days after
demand by such Bank (with a copy to the Agent), the Company shall pay to such
Bank such additional amount or amounts as will compensate such Bank for such
reduction.

 

SECTION 5.                                CONDITIONS PRECEDENT.

 

The
obligation of the Banks to make any Revolving Credit Loan pursuant hereto shall
be subject to the following conditions precedent set forth in Section 5.1 and
5.2 below and the obligation of the L/C Issuer to issue the Letter of Credit
pursuant hereto shall be subject to the condition precedent set forth in
Section 5.3 below:

 

5.1.          Initial Extension of Credit. On or before
July 15, 2005:

 

(a)           the Company shall have
delivered to the Agent for the benefit of the Banks in sufficient counterparts
for distribution to the Banks duly executed originals of the following:

 

(i)            the Revolving
Credit Notes;

 

(ii)           good standing
certificates for the Company and each Subsidiary issued by its state of
organization, issued not more than thirty (30) days before the date of this
Agreement;

 

(iii)          copies of the
Articles or Certificate of Incorporation, and all amendments thereto, of the
Company and each Subsidiary, certified by the Secretary of State of its state
of incorporation to the extent any of such documents have not previously been
provided to the Agent;

 

(iv)          copies of the
By-Laws, and all amendments thereto, of the Company and each Subsidiary,
certified as true, correct and complete on July 15, 2005, by the Secretary or
Assistant Secretary of the Company or such Subsidiary, as the case may be to
the extent any of such documents have not previously been provided to the
Agent;

 

(v)           copies,
certified as true, correct and complete by the Secretary or Assistant Secretary
of the Company of resolutions regarding the transactions contemplated by this
Agreement, duly adopted by the Board of Directors of the Company and reasonably
satisfactory in form and substance to the Agent;

 

18

 

(vi)          an incumbency
and signature certificate for the Company satisfactory in form and substance to
the Agent;

 

(b)           Prior to the initial Loan
hereunder, the Agent shall have received the favorable written opinion of
Anderson & Byrd, Kansas counsel to the Company, substantially in the form
of Exhibit D-1 attached hereto and the favorable written opinion of Spencer,
Scott & Dwyer, P.C., Missouri counsel to the Company, substantially in the
form of Exhibit D-2 attached hereto;

 

(c)           The Agent, the Syndication
Agent and each of the other Banks shall have received all up-front fees due and
payable to each of them, specifically including without limitation the
amendment fee, at closing in connection with the execution and delivery of this
Agreement and the transactions contemplated hereby.

 

(d)           All of the conditions set
forth in clauses (a), (b) and (c) above are deemed to have been satisfied on
July 15, 2005.

 

5.2.          Each Extension of Credit Under a
Revolving Credit Note. As of the time of the making of each
Revolving Credit Loan hereunder (including the initial Loan):

 

(a)           no Event of Default shall
have occurred and be continuing;

 

(b)           with respect to any
requested Revolving Credit Loan, after giving effect thereto the aggregate
principal amount of all outstanding Revolving Credit Loans shall not exceed the
aggregate Revolving Credit Commitments; and

 

(c)           the request by the Company
for any Revolving Credit Loan pursuant hereto shall be and constitute a
warranty to the effect set forth in (a) and (b), above and that the Compliance
Certificate most recently delivered to the Banks is materially correct.

 

5.3.          Issuance of Letter of Credit. The Company
shall have delivered to the Agent:

 

(a)           for the benefit of the Banks
in sufficient counterparts for distribution to the Banks duly executed
originals of the Letter of Credit Notes; and

 

(b)           an originally executed
Application.

 

SECTION 6.                                REPRESENTATIONS AND WARRANTIES.

 

As
of the Closing Date, and upon delivery of each Quarterly Compliance
Certificate, the Company represents and warrants to the Agent and the Banks as
to itself and, where the following representations and warranties apply to
Subsidiaries, as to each of its Subsidiaries, as follows:

 

6.1.          Organization and Qualification. The Company
is a corporation duly organized and existing and in good standing under the
laws of the State of Kansas, has full and adequate corporate power to carry on
its business as now conducted, and is duly licensed or qualified in all
jurisdictions wherein the nature of its activities requires such licensing or
qualification and in which the failure to be so licensed or qualified would
have a material adverse effect upon the business, operations or financial
condition of the Company and its Subsidiaries taken as a whole, a “Material
Adverse Effect.”

 

6.2.          Subsidiaries. Each
Subsidiary is duly organized and existing under the laws of the jurisdiction of
its organization, has full and adequate corporate power to carry on its
business as now conducted and is duly licensed or qualified in all
jurisdictions wherein the nature of its business requires such licensing or qualification
and the failure to be so licensed or qualified would have a Material Adverse
Effect. The only Subsidiaries of the Company as of the Closing Date are listed
on Exhibit C hereto.

 

19

 

6.3.          Financial Reports. The Company
has heretofore delivered to the Banks a copy of the Audit Report as of December
31, 2004 of the Company and its Subsidiaries (the “Audit Report”). The
financial statements contained in such Audit Report have been prepared in
accordance with GAAP on a basis consistent, except as otherwise noted therein,
with that of the previous fiscal year and fairly present, in all material
respects, the financial position of the Company and its Subsidiaries as of the
date thereof, and the results of its operations for the period covered thereby.
As of December 31, 2004, the Company and its Subsidiaries had no material
contingent liabilities other than as indicated on said financial statements
(including the notes thereto).

 

6.4.          No Material Adverse Change. Since
December 31, 2004, there has been no material adverse change in the business,
operations or financial condition of the Company and its Subsidiaries taken as
a whole that has not been disclosed in writing to the Banks.

 

6.5.          Litigation; Tax Returns;
Approvals. There is no litigation nor governmental proceeding
pending, nor to the knowledge of the Company threatened, against the Company or
any Subsidiary which could reasonably be expected to result in a Material
Adverse Effect. All federal and state income tax returns and all other material
tax returns for the Company required to be filed have been filed on a timely
basis and all amounts required to be paid as shown by said returns have been
paid, except such amounts, if any, as are being contested in good faith and by
appropriate proceedings. There are no pending or, to the best of the Company’s
knowledge, threatened objections to or controversies in respect of the income
tax returns of the Company for any fiscal year which could reasonably be expected
to have a Material Adverse Effect. Except as have already been obtained, no
authorization, consent, license, exemption or filing or registration with any
court or governmental department, agency or instrumentality, is necessary for
the valid execution, delivery or performance by the Company of the Loan
Documents.

 

6.6.          Regulation U. Neither the
Company nor any Subsidiary is engaged in the business of extending credit for
the purpose of purchasing or carrying margin stock (within the meaning of
Regulation U of the Board of Governors of the Federal Reserve System) and
no part of the proceeds of any Loan made hereunder will be used to purchase or
carry any margin stock or to extend credit to others for such a purpose.

 

6.7.          No Default. As of the
Closing Date, the Company is materially in compliance with all of the terms and
conditions of this Agreement, and no Event of Default exists under this
Agreement.

 

6.8.          ERISA. With respect
to each of the Plans, the Company and its Subsidiaries are in compliance with
ERISA to the extent applicable to them, other than such noncompliance that
would not reasonably be expected to result in a Material Adverse Effect and
have received no notice to the contrary from the PBGC or any other governmental
entity agency.

 

6.9.          Full Disclosure. The written
statements and information furnished to the Agent and the Banks in connection
with the negotiation of this Agreement and the other Loan Documents and the
commitments by the Banks to provide the financing contemplated hereby do not
contain any untrue statements of a material fact or omit a material fact
necessary to make the material statements contained herein or therein not
misleading, the Agent and the Banks acknowledging that as to any projections
furnished to the Agent and the Banks, the Company only represents that the same
were prepared on the basis of information and estimates the Company believed to
be reasonable.

 

6.10.        Corporate Authority and Validity
of Obligations. The Company has full corporate power and authority
to enter into this Agreement and the other Loan Documents, to make the
Borrowings herein provided for, to issue its Notes in evidence thereof, and to
perform all of its obligations hereunder and under the other Loan Documents. The
Loan Documents delivered by the Company have been duly authorized, executed and
delivered by the Company and constitute valid and binding obligations of the
Company enforceable in accordance with their terms except as enforceability may
be limited by bankruptcy, insolvency, or similar laws

 

20

 

affecting
creditors’ rights generally and general principles of equity. This Agreement
and the other Loan Documents do not, nor does the performance or observance by
the Company of any of the matters and things herein or therein provided for,
(a) contravene or constitute a default under (i) any provision of law or any
judgment, injunction, order or decree binding upon the Company or any provision
of the charter, articles of incorporation or by-laws of the Company or (ii) any
material covenant, indenture or agreement of or affecting the Company or any of
its Properties, except in the case of this clause (ii) for any such
contravention or default which could not be reasonably expected to result in a
Material Adverse Effect or (b) result in the creation or imposition of any
lien, security interest or other encumbrance on any Property of the Company.

 

6.11.        No Default Under Other Agreements. Neither the
Company nor any Subsidiary is in default with respect to any note, indenture,
loan agreement, mortgage, lease, deed or other agreement to which it is a party
or by which it or its Property is bound, which default might adversely affect
the repayment of the Indebtedness, obligations and liabilities under the Loan
Documents, or any Bank’s or the Agent’s rights under the Loan Documents or
which could reasonably be expected to have a Material Adverse Effect.

 

6.12.        Status Under Certain Laws. Neither the
Company nor any of its Subsidiaries is an “investment company” or a person
directly or indirectly controlled by or acting on behalf of an “investment
company” within the meaning of the Investment Company Act of 1940, as amended.

 

6.13.        Compliance with Laws. The Company
and its Subsidiaries each are in compliance with the requirements of all
federal, state and local laws, rules and regulations applicable to or
pertaining to their Properties or business operations, including, without
limitation, the Occupational Safety and Health Act of 1970, the Americans with
Disabilities Act of 1990, and Environmental Laws, non-compliance with which
could reasonably be expected to have a Material Adverse Effect. Neither the
Company nor any Subsidiary has received notice to the effect that its
operations are not in compliance with any of the requirements of applicable
federal, state or local Environmental Laws, health and safety statutes and
regulations or are the subject of any governmental investigation evaluating
whether any remedial action is needed to respond to a release of any toxic or
hazardous waste or substance into the environment, which non-compliance or
remedial action could reasonably be expected to have a Material Adverse Effect.

 

6.14.        Ownership of Property. The Company
and each of its Subsidiaries has good record and marketable title in fee simple
to, or valid leasehold interests in, all real property necessary or used in the
ordinary conduct of their respective businesses except for such defects in
title or interests as could not, individually or in the aggregate, have a
Material Adverse Effect.

 

6.15.        Solvency. The Company
and each of its Subsidiaries existing as of the date of this Agreement:  (a) own, on a consolidated basis, assets, the
fair saleable value of which are (i) greater than the total amount of their
liabilities (including contingent liabilities) and (ii) greater than the amount
that will be required to pay their liabilities when they become due; (b) have,
on a consolidated basis, capital that is not unreasonably small in relation to
their respective business as presently conducted or after giving effect to any
contemplated transaction; and (c) do not intend to incur and do not believe
that they will incur debts beyond their ability to pay such debts as they
become due.

 

6.16.        Pari Passu. All Loans of
the Company incurred under or pursuant to this Agreement shall rank pari passu
with all other senior unsecured Indebtedness of the Company.

 

SECTION 7.                                COVENANTS.

 

It
is understood and agreed that so long as any of the Credit is in use or
available under this Agreement or any amount remains unpaid on any Note except
to the extent compliance in any case or cases is waived in writing by the
Required Banks:

 

21

 

7.1.          Maintenance of Property. The Company
will, and will cause each Subsidiary to, keep and maintain all of its
Properties necessary or useful in its business in good condition, and make all
necessary renewals, replacements, additions and improvements thereto, except
where the failure to do so could not reasonably be expected to have a Material
Adverse Effect.

 

7.2.          Taxes. The Company
will, and will cause each Subsidiary to, duly pay and discharge all material
taxes, rates, assessments, fees and governmental charges upon or against the
Company or any Subsidiary or against its Properties in each case before the
same becomes delinquent and before penalties accrue thereon unless and to the
extent that the same is being contested in good faith and by appropriate
proceedings.

 

7.3.          Maintenance of Insurance. The Company
will, and will cause each Subsidiary to, maintain insurance with insurers
recognized as financially sound and reputable by prudent business persons in
such forms and amounts and against such risks as is usually carried by
companies engaged in similar business and owning similar Properties in the same
general areas in which the Company or such Subsidiary operates. The Company
shall provide the Agent with copies of all insurance policies maintained by it
upon the Agent’s request.

 

7.4.          Financial Reports. The Company
will, and will cause each Subsidiary to, maintain a system of accounting in
accordance with sound accounting practice and will furnish promptly, and in any
event within thirty (30) days after the receipt of a request, to each of the
Banks and their duly authorized representatives such information respecting the
business and financial condition of the Company and its Subsidiaries as may be
reasonably requested by the Agent or any Bank and, without any request, will
furnish to each Bank:

 

(a)           as soon as available, and in
any event within forty-five (45) days after the close of each fiscal quarter
other than the fourth fiscal quarter of the Company commencing with the fiscal
quarter ending June 30, 2005, a copy of the unaudited consolidated balance sheets,
income statements and cash flow statements for the Company and its Subsidiaries
for such quarterly period and the fiscal year to date and for the corresponding
periods of the preceding fiscal year, all in reasonable detail, prepared by the
Company (it being understood that delivery to the Agent of the Company’s
quarterly report on Form 10-Q filed with the Securities and Exchange Commission
shall meet the requirements of this Section 7.4(a)) and certified by the chief
financial officer of the Company;

 

(b)           as soon as available, and in
any event within ninety (90) days after the close of each fiscal year of the
Company, a copy of the audit report (including an unqualified opinion of the
Company’s auditors) for such year and accompanying financial statements,
including consolidated balance sheets, statements of stockholder equity,
statements of income and statements of cash flow for the Company and its
Subsidiaries showing in comparative form the figures for the previous fiscal
year of the Company and its Subsidiaries, all in reasonable detail, prepared
and certified by PricewaterhouseCoopers LLP or other independent certified
public accountants of nationally recognized standing selected by the Company
and reasonably satisfactory to the Required Banks (it being understood that
delivery to the Agent of the Company’s annual report on Form 10-K filed with
the Securities and Exchange Commission shall meet the requirements of this
Section 7.4(b)); and

 

(c)           no later than forty-five
(45) days after the close of each of the first three fiscal quarters of each
fiscal year, commencing with the fiscal quarter ending June 30, 2005, and for
the fourth fiscal quarter, no later than ninety (90) days after the close of
each fiscal year, a Compliance Certificate in the form of Exhibit E attached
hereto (the “Quarterly Compliance Certificate”) prepared and signed by the
chief financial officer of the Company.

 

22

 

If
any of the information referred to in this Section 7.4 is sent to the Agent,
but for any reason any Bank does not also receive it, the Agent will provide it
to such Bank promptly upon request.

 

7.5.          Inspection. Upon
reasonable notice and during normal business hours, the Company shall, and
shall cause each Subsidiary to, permit each of the Banks, by their
representatives and agents, to inspect any of the Properties, corporate books
and financial records of the Company and each Subsidiary, to examine and make
copies of the books of accounts and other financial records of the Company and
each Subsidiary and to discuss the affairs, finances and accounts of the
Company and each Subsidiary with, and to be advised as to the same by, its
officers and employees at such times and intervals as each Bank may reasonably
request. The Company shall reimburse the Agent for any reasonable costs and
expenses incurred by it in connection with any such inspections.

 

7.6.          Consolidation, Merger and Sale of
Assets. The Company will not, and will not permit any Subsidiary with assets
valued at greater than Fifteen Million Dollars ($15,000,000) to, consolidate
with or merge into any Person, or permit any other Person to merge into it or
sell or otherwise dispose of all or substantially all of their respective
Property, except that any Subsidiary may merge with and into any other
Subsidiary and except that any Person engaged in a regulated business may be
merged into the Company or any Subsidiary. The Company shall give written
notice to the Banks of any such merger contemporaneously with its consummation.

 

7.7.          Liens. The Company
will not and will not permit any Subsidiary with assets valued at greater than
Twenty-Five Million Dollars ($25,000,000) to pledge, mortgage or otherwise
encumber or subject to or permit to exist upon or be subjected to any lien,
charge or security interest of any kind (including any conditional sale or
other title retention agreement and any lease in the nature thereof), on any of
its Properties of any kind or character at any time owned by the Company or any
Subsidiary (collectively “Liens”), other than:

 

(a)           Liens, pledges or deposits
for workers’ compensation, unemployment insurance, old age benefits or social
security obligations, taxes, assessments, statutory obligations or other
similar charges, good faith deposits made in connection with tenders, contracts
or leases to which the Company or a Subsidiary is a party or other deposits
required to be made in the ordinary course of business, provided in each case
the obligation secured is not overdue or, if overdue, is being contested in
good faith by appropriate proceedings and adequate reserves have been provided
therefor in accordance with GAAP and that the obligation is not for borrowed
money, customer advances, trade payables, or obligations to agricultural
producers;

 

(b)           Liens securing an appeal or
stay or discharge in the course of any legal proceedings, provided that the
aggregate amount of liabilities of the Company or a Subsidiary so secured by a
pledge of Property permitted under this subsection (b) including interest and
penalties thereon, if any, shall not be in excess of $10,000,000 at any one
time outstanding;

 

(c)           Liens not otherwise
permitted hereunder in an amount not in excess of $25,000,000 at any time the
same is to be determined;

 

(d)           Liens (and any replacements
thereof without increase) existing on the date hereof and disclosed in
Exhibit F hereto;

 

(e)           Liens securing Indebtedness
incurred to finance, or which represents, the purchase price of Property,
provided (i) such Liens attach only to the Property financed with such
Indebtedness and (ii) the amount of such secured Indebtedness does not exceed
the purchase price of such Property plus any reasonable related fees and costs;

 

(f)            the filing of financing
statements solely as a precautionary measure in connection with operating
leases or other Liens permitted under this Agreement;

 

23

 

(g)           Liens with respect to
judgments which do not constitute Events of Default pursuant to this Agreement;

 

(h)           any interest of a lessor in
any Property subject to any lease entered into by the Company or a Subsidiary
in an amount not in excess of $7,500,000 at any time the same is to be
determined;

 

(i)            Liens securing Indebtedness
under that certain Indenture of Mortgage and Deed of Trust, dated as of
September 1, 1944, as and to be amended and supplemented, among the Company,
The Bank of New York and UMB Bank & Trust, N.A. (the “Mortgage”);

 

(j)            any Lien on Property of any
Person existing at the time such Person is merged or consolidated with or into
the Company or a Subsidiary and not created in contemplation of such event;

 

(k)           any Lien existing on any
Property prior to the acquisition thereof by the Company or a Subsidiary and
not created in contemplation of such acquisition;

 

(l)            Liens incurred in connection
with or related to the construction or purchase of utility Property;

 

(m)          the replacement, extension
or renewal of any Lien permitted by clauses (e), (j) or (k) above upon or in
the same Property theretofore subject thereto or the replacement, extension or
renewal (without increase in the amount or change in any direct or contingent
obligor) of the Indebtedness secured thereby;

 

(n)           Liens securing the claims or
demands of materialmen, mechanics, carriers, warehousemen, landlords and other
like persons for labor, materials, supplies or rentals incurred in the ordinary
course of the Company’s or a Subsidiary’s business, but only if the payment
thereof is not at the time past due or is being contested in good faith and by
appropriate proceedings with adequate reserves maintained in accordance with
GAAP; and

 

(o)           reservations, exceptions,
easements, rights of way, and other similar encumbrances affecting real
property, provided that they do not individually or in the aggregate detract
from the marketability of said properties or materially interfere with their
use in the ordinary course of the Company’s or a Subsidiary’s business as
permitted under the Mortgage; and

 

(p)           Liens incurred pursuant to
Section 2.4(c) hereof.

 

7.8.          Notice of Suit or Material
Adverse Change in Business or Default. The Company shall, as soon
as possible, and in any event within fifteen (15) days after it learns of the
following, give written notice to the Banks of (a) any proceeding(s) being
instituted or threatened to be instituted by or against the Company or any
Subsidiary in any federal, state or local court or before any commission or
other regulatory body (federal, state or local) which could reasonably be
expected to have a Material Adverse Effect and (b) the occurrence of any
Event of Default.

 

7.9.          ERISA. The Company
will, and will cause each Subsidiary to, promptly pay and discharge all
obligations and liabilities arising under ERISA of a character which if unpaid
or unperformed is likely to result in the imposition of a Lien against any of
its Property, and will promptly notify the Agent of (a) the occurrence of any
reportable event (as defined in ERISA) for which the notice requirement has not
been waived by the PBGC and which is reasonably likely to result in the
termination by the PBGC of any Plan, (b) receipt of any notice from PBGC of its
intention to seek termination of any such Plan or appointment of a trustee
therefor, and (c) its intention to terminate or withdraw from any Plan, other
than a “standard termination” meeting the requirements of Section 4041(b) of
ERISA. The Company will not, and will not permit any

 

24

 

Subsidiary
to, terminate any such Plan or withdraw therefrom unless it shall be in
compliance with all of the terms and conditions of this Agreement after giving
effect to any liability to PBGC resulting from such termination or withdrawal.

 

7.10.        Use of Proceeds. The Company
shall use the proceeds of the Revolving Credit Loans hereunder for working
capital, general corporate purposes and to back up the Company’s use of
commercial paper and the proceeds of the Letter of Credit Loans for purchase of
a share of a coal generating plant being built near Osceola, Arkansas, and for
the payment of related construction expenses.

 

7.11.        Compliance with Laws. The Company
will, and will cause each of its Subsidiaries to, comply in all material
respects with all applicable laws, rules, regulations and orders, including
Environmental Laws, except where the failure to do so could not reasonably be
expected to have a Material Adverse Effect.

 

7.12.        Fiscal Year. The Company
shall not change its fiscal year.

 

7.13.        Maintenance of Existence. The Company
shall maintain its corporate existence except for mergers permitted by Section
7.6 hereof.

 

7.14.        Maximum Total Indebtedness to
Total Capitalization Ratio. The Company will maintain
as of the last day of each fiscal quarter of the Company a ratio of Total
Indebtedness to Total Capitalization of not more than 0.625 to 1. For purposes
of this Section 7.14, “Total Indebtedness” shall mean all Indebtedness of the
Company and its Subsidiaries on a consolidated basis but shall exclude all
accounts payable and expenses incurred in the ordinary course of the Company’s
and its respective Subsidiaries’ businesses and also shall exclude all
obligations of the Company and its Subsidiaries related to the issuance in 2001
of Trust Preferred Securities by Empire District Electric Trust I; and “Total
Capitalization” shall mean the sum of Total Indebtedness and stockholders’
equity, preferred and preference stock and other securities included on the
consolidated balance sheet of the Company and its Subsidiaries including the
Junior Subordinated Debenture Securities issued in 2001 by the Company.

 

7.15.        Minimum Interest Coverage Ratio. The Company
will maintain an Interest Coverage Ratio of not less than 2.0 to 1 as of the
last day of each fiscal quarter of the Company.

 

7.16.        Acquisitions. During the
term of this Agreement, the Company will not, and will not permit any
Subsidiary to, (x) acquire any assets or equity interests of any other Person
or Persons engaged predominantly in an unregulated business activity unless the
aggregate consideration to be paid by the Company and its Subsidiaries in
connection with any such acquisition or acquisitions is, in the aggregate, less
than Eighty Million Dollars ($80,000,000.00) or (y) acquire all or part of a
regulated business; provided that in the case of this clause (y) any such acquisition
shall be permitted with the consent of the Required Banks (not to be
unreasonably withheld) if the Company is in compliance with all financial
covenants of this Agreement at the time of such proposed acquisition and will
be in compliance with such financial covenants following consummation of such
acquisition as evidenced by projected financial information covering a minimum
of an 18 month period after the acquisition. Such projections will be delivered
to the Banks within a reasonable time prior to entering into any written
commitments for such acquisition.

 

7.17.        Patriot Act. The Agent
hereby notifies the Company that pursuant to the requirements of the USA
Patriot Act (Title III of Pub. L. 107-56, signed into law October 26, 2001)
(the “Act”), and the Agent’s policies and practices, the Agent is required to
obtain, verify and record certain information and documentation that identifies
the Company, which information includes the name and address of the Company and
such other information that will allow the Agent to identify the Company in
accordance with the Act.

 

The
Company shall (a) ensure, and cause each Subsidiary to ensure, that no Person
who owns a controlling interest in or otherwise controls the Company or any
Subsidiary is or shall be

 

25

 

listed
on the Specially Designated Nationals and Blocked Person List or other similar
lists maintained by the Office of Foreign Assets Control (“OFAC”), the
Department of the Treasury or included in any Executive Orders, (b) not use or
permit the use of the proceeds of the Loans to violate any of the foreign asset
control regulations of OFAC or any enabling statute or Executive Order relating
thereto, and (c) comply, and cause each Subsidiary to comply, with all
applicable Bank Secrecy Act laws and regulations, as amended.

 

SECTION 8.                                EVENTS OF DEFAULT AND REMEDIES.

 

8.1.          Events of Default. Any one or
more of the following shall constitute an Event of Default:

 

(a)           (i) Default in the payment
when due of any principal of any Note whether at the stated maturity thereof or
at any other time provided in this Agreement, or (ii) default in the payment
when due of any interest on any Note or any fee or other amount payable
pursuant to this Agreement which default shall continue unremedied for one (1)
Business Day.

 

(b)           Default in the observance or
performance of any covenant set forth in Sections 7.3, 7.5, 7.6, 7.7, 7.8,
7.10, 7.13, 7.14 and 7.15 hereof;

 

(c)           Default in the observance or
performance of the covenants set forth in Section 7.4 and such default
shall continue for ten (10) days after the earlier of (i) the date on which
such default first became known to a responsible officer of the Company or
(ii) written notice thereof to the Company by the Agent;

 

(d)           Default in the observance or
performance of any other covenant, condition, agreement or provision hereof or
any of the other Loan Documents and such default shall continue for thirty (30)
days after the earlier of (i) the date on which such default first became known
to a responsible officer of the Company or (ii) written notice thereof to the
Company by the Agent;

 

(e)           Default shall occur under
any evidence of Indebtedness in a principal amount exceeding $10,000,000
issued, assumed or guaranteed by the Company or any Subsidiary, or under any
mortgage, agreement or other similar instrument under which the same may be
issued or secured and such default shall continue for a period of time
sufficient to permit the acceleration of maturity of any Indebtedness evidenced
thereby or outstanding or secured thereunder;

 

(f)            Any representation or
warranty made by the Company herein or in any Loan Document or in any statement
or certificate furnished by it pursuant hereto or thereto, proves untrue in any
material respect as of the date made or deemed made pursuant to the terms
hereof;

 

(g)           Any judgment or judgments,
writ or writs, or warrant or warrants of attachment, or any similar process or processes
in an aggregate amount in excess of $10,000,000 which is not covered by
insurance issued by an insurer that has acknowledged its liability thereon
shall be entered or filed against the Company, or any Subsidiary or against any
of their respective Property or assets and remain unpaid, unbonded, unstayed
and undischarged for a period of sixty (60) days from the date of its entry;

 

(h)           (i) Any reportable event (as
defined in Section 4043 of ERISA and for which the notice requirement has not
been waived pursuant to any applicable regulations promulgated thereunder)
which results in the PBGC instituting proceedings to terminate any Plan of the
Company or (ii) the appointment by the appropriate United States District Court
of a trustee to administer or liquidate any such Plan shall have been made
pursuant to Title IV of ERISA and continues for thirty (30) days after written
notice to such effect

 

26

 

shall
have been given to the Company by the Agent or (iii) any such Plan shall be
terminated other than in a “standard termination” meeting the requirements of
Section 4041(b) of ERISA;

 

(i)            The Company shall (i) have
entered involuntarily against it an order for relief under the Bankruptcy Code
of 1978, as amended, (ii) admit in writing its inability to pay or not pay, its
debts generally as they become due (iii) make an assignment for the benefit of
creditors, (iv) apply for, seek, consent to, or acquiesce in, the appointment
of a receiver, custodian, trustee, conservator, liquidator or similar official
for it or any substantial part of its Property or, (v) file a petition seeking
relief or institute any proceeding seeking to have entered against it an order
for relief under the Bankruptcy Code of 1978, as amended, to adjudicate it
insolvent, or seeking dissolution, winding up, liquidation, reorganization,
arrangement, marshalling of assets, adjustment or composition of its debts
under any law relating to bankruptcy, insolvency or reorganization or relief of
debtors;

 

(j)            (i)  A custodian, receiver, trustee, conservator,
liquidator or similar official shall be appointed for the Company or any
substantial part of its Property, (ii) a final order of condemnation shall be
entered in a court of appropriate jurisdiction against any substantial amount
of the Company’s Property, the loss of the use of which would have a Materially
Adverse Effect, or (iii) a proceeding described in Section 8.1(i)(iv) shall be
instituted against the Company and such appointment continues undischarged or
any such proceeding continues undismissed or unstayed for a period of sixty
(60) days;

 

(k)           A Change of Control shall
occur; or

 

(l)            The revocation or other loss
after all available appeals have been taken or administrative proceedings have
been completed of any permit or other governmental authority the revocation or
loss of which would have a Materially Adverse Effect.

 

8.2.          Remedies for Non-Bankruptcy
Defaults. When any Event of Default, other than an Event of
Default described in subsections (i) and (j) of Section 8.1 hereof, has
occurred and is continuing, the Agent, if directed by the Required Banks, shall
give notice to the Company and take any or all of the following actions:  (a) terminate the remaining Commitments
hereunder on the date (which may be the date thereof) stated in such notice and
as of such date notify the Company and the Beneficiary of the Letter of Credit
that the Expiration Date of the Letter of Credit will not be extended, (b)
declare the principal of and the accrued interest on the Notes to be forthwith
due and payable and thereupon the Notes including both principal and interest,
shall be and become immediately due and payable without further demand,
presentment, protest or notice of any kind, and (c) take any action or exercise
any remedy under any of the Loan Documents or exercise any other action, right,
power or remedy permitted by law. Any Bank may, without prior notice to the
Company, exercise the right of set off with regard to any deposit accounts or
other accounts or investments maintained by the Company with such Bank upon the
occurrence and continuation of an Event of Default if notice of such Event of
Default has been given by the Agent to the Company upon the direction of the
Required Banks.

 

8.3.          Remedies for Bankruptcy Defaults. When any
Event of Default described in subsections (h) or (i) of Section 8.1 hereof has
occurred and is continuing, then the Notes shall immediately become due and
payable without presentment, demand, protest or notice of any kind, and the
obligation of the Banks to extend further credit or extend the Expiration Date
of the Letter of Credit pursuant to any of the terms hereof or the Letter of
Credit shall immediately terminate.

 

SECTION 9.                                CHANGE IN CIRCUMSTANCES REGARDING LIBOR PORTIONS.

 

9.1.          Change of Law. Notwithstanding
any other provisions of this Agreement or any Note to the contrary, if with
respect to LIBOR Portions, any Bank shall determine in good faith that any
change in applicable law or regulation or in the interpretation thereof at any
time after

 

27

 

the Closing Date makes it unlawful for such Bank to create or continue
to maintain any LIBOR Portion or to give effect to its obligations to create,
continue or convert LIBOR Portions as contemplated hereby, such Bank shall
promptly give notice thereof to the Company and to the Agent to such effect,
and such Bank’s obligation to create, continue or convert any such affected
LIBOR Portions under this Agreement shall terminate until it is no longer
unlawful for such Bank to create or maintain such affected Portion. The Company
shall prepay the outstanding principal amount of any such affected LIBOR
Portion made to it, together with all interest accrued thereon and all other
amounts due and payable to such Bank under Section 9.4 of this Agreement, on
the earlier of the last day of the Interest Period applicable thereto and the
first day on which it is illegal for such Bank to have such LIBOR Portion
outstanding; provided, however, the Company may convert the affected LIBOR
Portions into an ABR Portion, subject to all of the terms and conditions of
this Agreement.

 

9.2.          Unavailability of Deposits or
Inability to Ascertain the Adjusted LIBOR Rate. Notwithstanding any other
provision of this Agreement or any Note to the contrary, if prior to the
commencement of any Interest Period any Bank shall determine (a) that deposits
in the amount of any LIBOR Portion scheduled to be outstanding are not
available to them in the relevant market or (b) by reason of circumstances
affecting the relevant market, adequate and reasonable means do not exist for
ascertaining the Adjusted LIBOR Rate, then such Banks shall give telephonic or
telex notice thereof to the Company, the Agent and the other Banks (such notice
to be confirmed in writing), and the obligation of the Banks to create,
continue or convert any such LIBOR Portion in such amount and for such Interest
Period shall terminate until deposits in such amount and for the Interest
Period selected by the Company shall again be readily available in the relevant
market and adequate and reasonable means exist for ascertaining the Adjusted
LIBOR Rate. Upon the giving of such notice, the Company shall elect to either
(i) pay or prepay, as the case may be, such affected Portion or (ii) convert
the affected LIBOR Portion into an ABR Portion, subject to all terms and
conditions of this Agreement.

 

9.3.          Taxes and Increased Costs. (a) With
respect to the LIBOR Portions, if any Bank shall determine in good faith that
any change in any applicable law, treaty, regulation or guideline (including,
without limitation, Regulation D of the Board of Governors of the Federal
Reserve System) or any new law, treaty, regulation or guideline, or any
interpretation of any of the foregoing by any governmental authority charged
with the administration thereof or any central bank or other fiscal, monetary
or other authority having jurisdiction over such Bank or the LIBOR Portions
contemplated by this Agreement (whether or not having the force of law) (“Change
in Law”) shall:

 

(i)            impose, modify
or deem applicable any reserve, special deposit or similar requirements against
assets held by, or deposits in or for the account of, or loans by, or any other
acquisition of funds or disbursements by, such Bank (other than reserves
included in the determination of the Adjusted LIBOR Rate);

 

(ii)           subject such
Bank, any LIBOR Portion or any Note to any tax (including, without limitation,
any United States interest equalization tax or similar tax however named
applicable to the acquisition or holding of debt obligations and any interest
or penalties with respect thereto), duty, charge, stamp tax, fee, deduction or
withholding in respect of this Agreement, any LIBOR Portion or any Note except
such taxes (x) as may be measured by the overall net income of such Bank and
imposed by the jurisdiction, or any political subdivision or taxing authority
thereof, in which such Bank’s principal executive office is located, and
(y) any U.S. Taxes (as defined in Section 11.18(c) hereof) that are
deductible or otherwise directly payable by the Company, which shall be
governed exclusively by Section 11.18 hereof;

 

(iii)          change the
basis of taxation of payments of principal and interest due from the Company to
such Bank hereunder or under any Note (other than by a change in taxation of
the overall net income of such Bank); or

 

28

 

(iv)          impose on such
Bank any penalty with respect to the foregoing or any other condition regarding
this Agreement, any LIBOR Portion or any Note;

 

(v)           and such Bank
shall determine that the result of any of the foregoing is to increase the cost
(whether by incurring a cost or adding to a cost) to such Bank of making or
maintaining any LIBOR Portion hereunder or to reduce the amount of principal or
interest received by such Bank, in either case by an amount determined by such
Bank to be material, then the Company shall pay to such Bank from time to time
as specified by such Bank such additional amounts as such Bank shall reasonably
determine are sufficient to compensate and indemnify it for such increased cost
or reduced amount. If any Bank makes such a claim for compensation, it shall
provide to the Company a certificate setting forth such increased cost or
reduced amount as a result of any event mentioned herein specifying such Change
in Law, and such certificate shall be conclusive and binding on the Company as
to the amount thereof, absent manifest error.

 

(b)           In the event any Bank
requires payment under Section 4.8 or 11.18 hereof, delivers a certificate
pursuant to subsection (a) above or gives notice under Section 9.1 that it will
not fund or maintain LIBOR Portions, the Company may require, at its expense,
such Bank to assign (in accordance with Section 11.17 hereof) all its
interests, rights and obligations hereunder (including all of its Commitment
and the Loans at the time owing to it, and the Notes held by it), to one or
more financial institutions specified by the Company (each a “Substitute Bank”),
provided that (i) such assignment shall not conflict with or violate any law,
rule or regulation or order of any court or other governmental agency or
instrumentality, (ii) the Agent shall assist the Company in finding a
Substitute Bank that is reasonably acceptable to the Company and the Agent and
(iii) the Company shall have paid to the assigning Bank all monies then due to
it under the Loan Documents (including pursuant to this Section 9.3 and
Sections 4.8 and 11.18) with the Substitute Bank purchasing all accrued but not
yet due indebtedness, obligations and liabilities of the Company owed such
assigning Bank.

 

9.4.          Funding Indemnity. (a) In the
event any Bank shall incur any loss, cost, expense or premium (including,
without limitation, any loss, cost, expense or premium incurred by reason of
the liquidation or re-employment of deposits or other funds acquired by such
Bank to fund or maintain any LIBOR Portion or the relending or reinvesting of
such deposits or amounts paid or prepaid to such Bank) as a result of:

 

(i)            any conversion,
payment or prepayment of a LIBOR Portion on a date other than the last day of
the then-applicable Interest Period; or

 

(ii)           any failure by
the Company to borrow, continue or convert any LIBOR Portion on the date
specified in the notice given pursuant to Sections 3.3 or 3.6 hereof, then, upon
the demand of such Bank, the Company shall pay to such Bank such amount as will
reimburse such Bank for such loss, cost or expense.

 

(b)           If any Bank makes a claim
for compensation under this Section 9.4, it shall provide to the Company a
certificate setting forth the amount of such loss, cost or expense in a
reasonable detail and such certificate shall be conclusive and binding on the
Company as to the amount thereof, absent manifest error.

 

9.5.          Discretion of Bank as to Manner
of Funding. Notwithstanding any provision of this Agreement to
the contrary, each Bank shall be entitled to fund and maintain its funding of
all or any part of its Loans in any manner it sees fit, it being understood
however, that for the purposes of this Agreement, all determinations hereunder
shall be made as if the Banks had actually funded and maintained each LIBOR
Portion during each Interest Period for such LIBOR Portion through the purchase
of deposits in the relevant interbank market having a maturity corresponding to
such Interest Period and bearing an interest rate equal to the Adjusted LIBOR
Rate, for such Interest Period.

 

29

 

SECTION 10.                          THE ADMINISTRATIVE AGENT.

 

10.1.        Appointment and Powers. UMB is hereby
appointed by the Banks as Administrative Agent (the “Agent”) under the Loan
Documents, and each of the Banks irrevocably authorizes the Agent to act as the
agent of such Bank. The Agent agrees to so act as such upon the express
conditions contained in this Agreement.

 

10.2.        Powers. The Agent
shall have and may exercise such powers hereunder as are specifically delegated
to the Agent by the terms of the Loan Documents, together with such powers as
are incidental thereto. The Agent shall have no implied duties to the Banks nor
any obligation to the Banks to take any action under the Loan Documents except
any action specifically provided by the Loan Documents to be taken by the Agent,
and in no event shall the Agent have any fiduciary responsibilities to any
Bank.

 

10.3.        General Immunity. Neither the
Agent nor any of its directors, officers, agents, representatives, consultants,
advisors, counsel or employees shall be liable to the Banks or any Bank for any
action taken or omitted to be taken by it or them under the Loan Documents or
in connection therewith except for its or their own gross negligence or willful
misconduct.

 

10.4.        No Responsibility for Loans,
Recitals, etc. The Agent shall not (a) be responsible to the Banks
for any recitals, reports, statements, warranties or representations made by
the Company contained in the Loan Documents or furnished pursuant thereto,
(b) be responsible for any Loans of the other Banks hereunder, or
(c) be bound to ascertain or inquire as to the performance or observance
of any of the terms of the Loan Documents. In addition, neither the Agent nor
its counsel shall be responsible to the Banks for the enforceability or
validity of any of the Loan Documents.

 

10.5.        Right to Indemnity. The Banks
hereby indemnify the Agent for any actions taken in accordance with this
Section 10, and the Agent shall be fully justified in failing or refusing to
take any action hereunder unless it shall first be indemnified to its
satisfaction by the Banks pro rata in accordance with their respective
Exposures against any and all liability and expense which may be incurred by it
by reason of taking or continuing to take any such action, other than any
liability which may arise out of the Agent’s gross negligence or willful
misconduct.

 

10.6.        Action Upon Instructions of
Required Banks. The Agent agrees, upon the written request of the
Required Banks, to take any action of the type specified in the Loan Documents
as being within the Agent’s rights, duties, powers or discretion. The Agent
shall in all cases be fully protected in acting, or in refraining from acting,
hereunder in accordance with written instructions signed by the Required Banks
(or all of the Banks, if the Loan Documents specifically require the consent of
all of the Banks), and such instructions and any action taken or failure to act
pursuant thereto shall be binding on all of the Banks and on all holders of the
Notes. In the absence of a request by the Required Banks, the Agent shall have
authority, in its sole discretion, to take or not to take any action, unless
the Loan Documents specifically require the consent of the Required Banks or
all of the Banks.

 

10.7.        Employment of Agents and Counsel. The Agent may
execute any of its duties as Agent hereunder by or through employees, agents,
and attorneys-in-fact and shall not be answerable to the Banks, except as to
money or securities actually received by it or its authorized agents, for the
default or misconduct of any such agents or attorneys-in-fact selected by it in
good faith and with reasonable care. The Agent shall be entitled to act upon
the advice and opinion of legal counsel concerning all matters pertaining to
the duties of the agencies hereby created.

 

10.8.        Reliance on Documents; Counsel. The Agent
shall be entitled to rely upon any Note, notice, consent, certificate,
affidavit, letter, telegram, statement, paper or document believed by it to be
genuine and correct and to have been signed or sent by the proper person or
persons, and, in respect to legal matters, upon the opinion of legal counsel
selected by the Agent.

 

30

 

10.9.        May Treat Payee as Owner. The Agent may
deem and treat the payee of any Note as the owner thereof for all purposes
hereof unless and until a written notice of the assignment or transfer thereof
shall have been filed pursuant to Section 11.20 hereof with the Agent. Any
request, authority or consent of any person, firm or corporation who at the
time of making such request or giving such authority or consent is the holder
of any such Note shall be conclusive and binding on any subsequent holder,
transferee or assignee of such Note or of any Note issued in exchange therefor.

 

10.10.      Agent’s Reimbursement. Each Bank
agrees to reimburse the Agent pro rata in accordance with its Exposure for any
reasonable out-of-pocket expenses (including fees and charges for record
inspections) not reimbursed by the Company (a) for which the Agent is entitled
to reimbursement by the Company under the Loan Documents and (b) for any other
reasonable expenses incurred by the Agent on behalf of the Banks, in connection
with the preparation, execution, delivery, administration and enforcement of
the Loan Documents, provided, however, that no Bank shall be liable for any of
the foregoing to the extent any of the foregoing arise from the gross
negligence or willful misconduct of the Agent.

 

10.11.      Rights as a Bank. With respect to
its commitment, Loans made by it, the Letter of Credit and the Notes issued to
it, the Agent shall have the same rights and powers hereunder as any Bank and
may exercise the same as though it were not the Agent, and the term “Bank” or “Banks”
shall, unless the context otherwise indicates, include the Agent in its
individual capacity. Any of the Banks, including the Agent as if it were not
the Agent for the Banks, may accept deposits from, lend money to, and generally
engage in any kind of banking or trust business with the Company.

 

10.12.      Bank Credit Decision. Each Bank
acknowledges that it has, independently and without reliance upon the Agent,
the Syndication Agent, or any other Bank and based on the financial statements
referred to in Section 6.3 and such other documents and information as it has
deemed appropriate, made its own credit analysis and decision to enter into the
Loan Documents. Each Bank also acknowledges that it will, independently and
without reliance upon the Agent or any other Bank 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 Loan Documents. The
Agent and the Syndication Agent shall not have any right, power, obligation,
liability, responsibility or duty under this Agreement other than those
applicable to all Banks as such except as otherwise expressly stated herein. Without
limiting the foregoing, the Agent and the Syndication Agent shall not have or
be deemed to have any fiduciary duty to or fiduciary relationship with any Bank.
In addition to the agreement set forth in this Section 10.12, each of the Banks
agrees that it has not relied on, and will not rely on,  the Agent or the Syndication Agent or any
other Bank, in deciding to take or not to take any action hereunder.

 

10.13.      Resignation of Agent. Subject to the
appointment of a successor Agent, the Agent may resign as Agent for the Banks
under this Agreement and the other Loan Documents at any time upon thirty (30)
days’ notice in writing to the Banks. Such resignation shall take effect upon
appointment of such successor. The Required Banks, with the consent of the
Company (unless an Event of Default shall have occurred and be continuing, in
which event the Company’s consent shall not be required) shall have the right
to appoint a successor Agent who shall be entitled to all of the rights of, and
vested with the same powers as, the original Agent under the Loan Documents. In
the event a successor Agent shall not have been appointed within the sixty (60)
day period following the given of notice by the Agent, the Agent may appoint
its own successor. Resignation by the Agent shall not affect or impair the
rights of the Agent under Sections 10.5 and 10.10 hereof with respect to all
matters preceding such resignation. Any successor Agent must be a national
banking association or a bank chartered in any State of the United States, in
each case having capital and surplus of not less than $500,000,000, or one of
the Banks.

 

10.14.      Duration of Agency. The agency
established by Section 10.1 hereof shall continue, and Sections 10.1 through
and including this Section 10.14 shall remain in full force and effect, until
the Notes and all other amounts due hereunder and thereunder shall have been

 

31

 

paid
in full and the Banks’ commitments to extend credit to or for the benefit of
the Company shall have terminated or expired.

 

SECTION 11.                          MISCELLANEOUS.

 

11.1.        Amendments and Waivers. Any term,
covenant, agreement or condition of this Agreement and the other Loan Documents
may be amended only by a written amendment executed by the Company, the
Required Banks and, if the rights or duties of the Agent are affected thereby,
the Agent, or compliance therewith only may be waived (either generally or in a
particular instance and either retroactively or prospectively), if the Company
shall have obtained the consent in writing of the Required Banks and, if the
rights or duties of the Agent are affected thereby, the Agent, provided,
however, that

 

(a)           without the consent in
writing of the holders of all outstanding Notes, or all Banks if no Notes are
outstanding, no such amendment or waiver shall (i) change the amount or
postpone the date of payment of any scheduled payment or required prepayment of
principal of the Notes at a time that the Company would not be able to obtain a
Loan or reduce the rate or extend the time of payment of interest on the Notes,
or reduce the amount of principal thereof, or modify any of the provisions of
the Notes with respect to the payment or prepayment thereof, (ii) amend
the definition of Required Banks, (iii) alter, modify or amend the provisions
of this Section 11.1, (iv) change the amount or term of any of the Banks’
Commitments or the fees required under Section 4 hereof or increase the
aggregate amount of all of the Banks’ Commitments, (v) alter, modify or amend
any Bank’s right hereunder to consent to any action, make any request or give
any notice, or (vi) alter, modify or amend the provisions of Section 5 of this
Agreement; and

 

(b)           without the consent of the
Agent, no such amendment or waiver shall affect the rights of the Agent under
Section 10 hereof; and

 

(c)           except to the extent
provided in Sections 11.16 and 11.17, no such amendment or waiver shall amend
Section 2.2 hereof without the consent of UMB;

 

Any
such amendment or waiver shall apply equally to all Banks and the holders of
the Notes and shall be binding upon them, upon each future holder of any Note
and upon the Company, whether or not such Note shall have been marked to
indicate such amendment or waiver. No such amendment or waiver shall extend to
or affect any obligation not expressly amended or waived.

 

11.2.        Waiver of Rights. No delay or
failure on the part of the Agent or any Bank or on the part of the holder or
holders of any Note in the exercise of any power or right shall operate as a
waiver thereof, nor as an acquiescence in any Event of Default, nor shall any
single or partial exercise of any power or right preclude any other or further
exercise thereof, or the exercise of any other power or right, and the rights
and remedies hereunder of the Agent, the Banks and of the holder or holders of
any Notes are cumulative to, and not exclusive of, any rights or remedies which
any of them would otherwise have.

 

11.3.        Several Obligations. The commitments
of each of the Banks hereunder shall be the several obligations of each Bank
and the failure on the part of any one or more of the Banks to perform
hereunder shall not affect the obligation of the other Banks hereunder,
provided that nothing herein contained shall relieve any Bank from any
liability for its failure to so perform. In the event that any one or more of
the Banks shall fail to perform its commitment hereunder, all payments
thereafter received by the Agent on the principal of Loans hereunder, shall be
distributed by the Agent to the Banks making such additional Loans ratably as
among them in accordance with the principal amount of additional Loans made by
them until such additional Loans shall have been fully paid and satisfied. All
payments on account of interest shall be applied as among all the Banks ratably
in accordance with the amount of interest owing to each of the Banks as of the
date of the receipt of such interest payment.

 

32

 

11.4.        Non-Business Day. If any
payment of principal or interest on any Loan shall fall due on a day which is
not a Business Day, interest at the rate such Loan bears for the period prior
to maturity shall continue to accrue on such principal from the stated due date
thereof to and including the next succeeding Business Day on which the same is
payable.

 

11.5.        Documentary Taxes. The Company
agrees to pay any documentary or similar taxes, if any, with respect to the
Loan Documents, including interest and penalties, in the event any such taxes
are assessed irrespective of when such assessment is made and whether or not
any credit is then in use or available hereunder.

 

11.6.        Representations. All representations
and warranties made herein or in certificates given pursuant hereto shall
survive the execution and delivery of this Agreement and of the Notes, and
shall continue in full force and effect with respect to the date as of which
they were made and as reaffirmed by Quarterly Compliance Certificates as long
as any credit is in use or available hereunder.

 

11.7.        Notices. Unless
otherwise expressly provided herein, all communications provided for herein
shall be in writing or by telecopy and shall be deemed to have been given or
made when served personally, when confirmation of receipt is received in the
case of notice by telecopy, when actually delivered by a reputable courier
service or five (5) Business Days after the date when deposited in the United
States mail (registered, if to the Company) addressed, if to the Company to 602
Joplin Street; Joplin, Missouri 64801; Attention:  Gregory A. Knapp (Telephone number (417)
625-6595, Telecopy number (417) 625-5153); if to the Agent or UMB at 1010 Grand
Boulevard; Kansas City, Missouri 64106; Attention:  Charles J. Wolf (Telephone number (816)
860-7130, Telecopy number (816) 860-7143); and, if to any of the Banks, at the
address for each Bank set forth under its signature hereon; or at such other
address as shall be designated by any party hereto in a written notice to each
other party pursuant to this Section 11.7.

 

11.8.        Costs and Expenses; Indemnity. (a)  The Company agrees to pay on demand (i) all
reasonable costs and expenses of the Agent incurred in connection with the
negotiation, preparation, execution and delivery of this Agreement, the Notes,
the Letter of Credit and any other instruments and documents to be delivered
hereunder or in connection with the transactions contemplated hereby, including
the reasonable fees and expenses of Spencer Fane Britt & Browne LLP,
counsel to the Agent; (ii) all reasonable costs and expenses of the Agent
(including reasonable attorneys’ fees) incurred in connection with any consents
or waivers hereunder or amendments hereto; and (iii) all reasonable costs and
expenses (including reasonable attorneys’ fees), if any, incurred by the Agent,
the Banks or any other holders of a Note in connection with the enforcement of
this Agreement or the Notes and any other instruments and documents to be
delivered hereunder. The Company agrees to indemnify and save harmless the
Banks and the Agent from any and all liabilities, losses, costs and expenses
incurred by the Banks or the Agent in connection with any action, suit or
proceeding brought against the Agent, the L/C Issuer or any Bank by any Person
which arises out of the transactions contemplated or provided for hereby, by
the Letter of Credit or by the Notes, or out of any action or inaction by the
Agent, L/C Issuer or any Bank hereunder or thereunder, except for such thereof
as is caused by the gross negligence or willful misconduct of the party
indemnified.

 

(b)           The provisions of this
Section 11.8 and the protective provisions of Section 9.4 hereof shall
survive payment of the Notes and the termination of the Banks’ Commitments
hereunder.

 

11.9.        Counterparts. This
Agreement may be executed in any number of counterparts and all such
counterparts taken together shall be deemed to constitute one and the same
instrument. This Agreement shall become effective as and when the Agent, all of
the Banks and the Company have executed this Agreement or a counterpart thereof
and delivered, except in the case of the Agent, the same to the Agent.

 

33

 

11.10.      Successors and Assigns; Governing
Law; Entire Agreement. This Agreement shall be binding upon each
of the Company, the Agent and the Banks and their respective successors and
assigns, and shall inure to the benefit of the Company, the Agent and each of
the Banks and the benefit of their respective successors and assigns, including
any subsequent holder of any Note (in the case of the Banks and their
respective successors and assigns, to the extent provided in Sections 11.16 and
11.17 hereof). This Agreement and the rights and duties of the parties hereto
shall be construed and determined in accordance with the laws of the State of
Missouri, except conflict of laws principles. This Agreement constitutes the
entire understanding of the parties with respect to the subject matter hereof
and any prior agreements, whether written or oral, with respect to the subject
matter hereof are superseded hereby. The Company may not assign any of its
rights or obligations hereunder without the written consent of the Banks.

 

11.11.      No Joint Venture. Nothing
contained in this Agreement shall be deemed to create a partnership or joint
venture among the parties hereto.

 

11.12.      Severability. In the event
that any term or provision hereof is determined to be unenforceable or illegal,
it shall be deemed severed herefrom to the extent of the illegality and/or
unenforceability and all other provisions hereof shall remain in full force and
effect.

 

11.13.      Table of Contents and Headings. The table of
contents and section headings in this Agreement are for reference only and
shall not affect the construction of any provision hereof.

 

11.14.      Sharing of Payments. Each Bank
agrees with each other Bank that if such Bank shall receive and retain any
payments, whether by set-off or application of deposit balances or otherwise (“Set-Off”),
on any Loan or other amount outstanding under this Agreement or the other Loan
Documents in excess of its ratable share of payments on all Loans and other
amounts then outstanding to the Banks, then such Bank shall purchase for cash
at face value, but without recourse (except for defects in title), ratably from
each of the other Banks such amount of the Loans held by each such other Bank
(or interest therein) as shall be necessary to cause such Bank to share such
excess payment ratably with all the other Banks; provided, however, that if any
such purchase is made by any Bank, and if such excess payment or part thereof
is thereafter recovered from such purchasing Bank, the related purchases from
the other Banks shall be rescinded ratably and the purchase price restored as
to the portion of such excess payment so recovered, but without interest. Each
Bank’s ratable share of any such Set-Off shall be determined by the proportion
that the aggregate principal amount of Loans and other amounts then due and
payable to such Bank bears to the total aggregate principal amount of Loans and
other amounts then due and payable to all the Banks.

 

11.15.      Jurisdiction; Venue; Waiver of
Jury Trial. The Company hereby submits to the nonexclusive
jurisdiction of the United States District Court for the Western District of
Missouri and of any Missouri court sitting in Kansas City, Missouri, for
purposes of all legal proceedings arising out of or relating to this Agreement or
the transactions contemplated hereby. The Company irrevocably waives, to the
fullest extent permitted by law, any objection which it may now or hereafter
have to the laying of venue of any such proceeding brought in such a court and
any claim that any such proceeding brought in such a court has been brought in
an inconvenient forum. The Company, the Agent and each Bank hereby irrevocably
waives any and all right to trial by jury in any legal proceeding arising out
of or relative to any Loan Document or the transactions contemplated thereby.

 

11.16.      Participants. Each Bank
shall have the right at its own cost to grant participations (to be evidenced
by one or more agreements or certificates of participation) in the Loans made
and Commitments held by such Bank at any time and from time to time to other
financial institutions; provided that (a) no such participation shall
relieve any Bank of any of its obligations under this Agreement (b) no
such participant shall have any direct rights under this Agreement except as
provided in this Section 11.16, and the Agent shall not have any obligation or
responsibility to such participant. Any agreement pursuant to which such
participation is granted, except with respect to a participation in which a
participant is an Affiliate of a Bank,

 

34

 

shall provide that the granting Bank shall retain the sole right and
responsibility to enforce the obligations of the Company under this Agreement
and the other Loan Documents including, without limitation, the right to
approve any amendment, modification or waiver of any provision of the Loan
Documents, except that such agreement may provide that such Bank will not agree
to any modification, amendment or waiver of the Loan Documents that would
reduce the amount of or postpone any fixed date for payment of any obligation
in which such participant has an interest. Any party to which such a
participation has been granted shall have the benefits of Section 9.3 and
Section 9.4 hereof, up to an amount not exceeding the amount that would
otherwise have been payable to the Bank who sold the participation interest to
such party. Subject to the provisions of Section 11.19 hereof, the Company
authorizes each Bank to disclose to any participant or prospective participant
under this Section 11.16 any financial or other information pertaining to the
Company. Notwithstanding the foregoing, in no event may a participation be
granted to any entity which is not a financial institution without the express
prior written consent of the Company.

 

11.17.      Assignment Agreements.

 

(a)           Assignments. Each Bank
may, at its own expense, from time to time, assign to other financial
institutions all or part of its rights and obligations under this Agreement
(including without limitation the Indebtedness evidenced by the Notes then
owned by such assigning Bank, together with an equivalent proportion of its
obligation to make loans and advances) pursuant to written agreements executed
by such assigning Bank, such assignee lender or lenders, the Company and the
Agent, which agreements shall specify in each instance the portion of the
Indebtedness evidenced by the Notes which is to be assigned to each such
assignee lender and the portion of the Commitments of the assigning Bank to be
assumed by it (the “Assignment Agreements”); provided, however, that unless the
Agent, the Company, the assignor Bank and the assignee lender, in writing,
agree to the contrary, (i) except in connection with any assignment by a Bank
to any of its Affiliates, the aggregate amount of the Exposure of the
assigning Bank being assigned to such assignee lender pursuant to each such
assignment (determined as of the effective date of the relevant Assignment
Agreement) shall in no event be less than the lesser of $5,000,000 or the
assignor Bank’s unused Revolving Credit Commitment; (ii) the parties to
each such assignment shall execute and deliver to the Agent, for its acceptance
and recording in the Register pursuant to Section 11.20 hereof, an Assignment
Agreement, together with any Notes subject to such assignment, (iii) the
Agent and (except for an assignment made during the continuance of any Event of
Default) the Company must consent to each such Assignment Agreement, which
consents shall not be unreasonably withheld, to each such assignment to
(provided no such consent is required for any assignment to any Affiliate of
the assigning Bank), and (iv) except in connection with any assignment by a
Bank to any of its Affiliates, the assignee lender must pay to the Agent a
processing and recordation fee of $4,000 and any out-of-pocket attorneys’ fees
incurred by the Agent in connection with such Assignment Agreement. Upon the
execution of each Assignment Agreement by the assigning Bank thereunder, the
assignee lender thereunder, the Company and the Agent, satisfaction of all of
the conditions set forth above and payment to such assigning Bank by such
assignee lender of the purchase price for the portion of the Exposure being
acquired by it, (i) such assignee lender shall thereupon become a “Bank”
for all purposes of this Agreement with an Exposure in the amounts set forth in
such Assignment Agreement and with all the rights, powers and obligations
afforded a Bank hereunder, (ii) such assigning Bank shall have no further
liability for funding the portion of any of its Commitments assumed by such
other Bank, and (iii) the address for notices to such assignee Bank shall
be as specified in the Assignment Agreement executed by it. Concurrently with
the execution and delivery of such Assignment Agreement executed by it, the
Company shall execute and deliver new Notes to the assignee Bank in the amount
of its applicable Commitment or Loan and new Notes to the assigning Bank in the
amounts of its applicable Commitment or Loan after giving effect to the
reduction occasioned by such assignment, such new Notes to constitute “Notes”
for all purposes of this Agreement. Notwithstanding the foregoing, in no event
may any assignment be made pursuant to this Section 11.17(a) to any entity

 

35

 

which
is not a financial institution without the express prior written consent of the
Company.

 

(b)           Pledges. Any Bank may
at any time pledge or grant a security interest in all or any portion of its
rights under this Agreement to secure obligations of such Bank, including any
such pledge or grant to a Federal Reserve Bank, and Section 11.17(a) shall not
apply to any such pledge or grant of a security interest; provided that no such
pledge or grant of a security interest shall release a Bank from any of its
obligations hereunder or substitute any such pledgee or secured party for such
Bank as a party hereto; provided further, however, the right of any such
pledgee or grantee (other than any Federal Reserve Bank) to further transfer
all or any portion of the rights pledged or granted to it, whether by means of
foreclosure or otherwise, shall be at all times subject to the terms of this
Agreement.

 

11.18.      Withholding Taxes.

 

(a)           U.S. Withholding Tax Exemptions. Each Bank
that is not a United States person (as such term is defined in Section
7701(a)(30) of the Internal Revenue Code of 1986, as amended (the “Code”))
shall submit to the Company and the Agent on or before the date the initial
Borrowing is made hereunder or, if later, the date such Bank becomes a Bank
hereunder, two (2) properly completed and duly executed copies of (i) either
Internal Revenue Service Form W-8 ECI (certifying the Bank’s status as a
beneficial owner and entitlement to complete exemption from withholding on all
amounts to be received by such Bank, including fees, pursuant to this Agreement
and the Loans as effectively connected with the conduct of a U.S. trade or
business) or W-8 BEN (certifying the Bank’s status as beneficial owner and
entitlement to a complete exemption from withholding on all amounts to be
received by such Bank, including fees, pursuant to this Agreement and the
Loans, or any successor form as shall be adopted from time to time by the
Internal Revenue Service;  or (ii) solely
if such Bank is claiming exemption from United States withholding tax under
Section 871(h) or 881(c)(3)(A) of the Code with respect to payments of “portfolio
interest”, Internal Revenue Service Form W-8 BEN, and a certificate
representing that such Bank is not a bank for purposes of Section 881(c) of the
Code, is not a ten percent (10%) shareholder (within the meaning of Section
871(h)(3)(B) of the Code) of the Company and is not a controlled foreign
corporation related to the Company (within the meaning of Section 864(d)(4) of
the Code) (or in the case of any such form, such successor form as shall be
adopted from time to time by the Internal Revenue Service. Thereafter and from
time to time, each such Bank shall submit to the Company and the Agent such
additional properly completed and duly executed copies of one of such Forms (or
such successor forms as shall be adopted from time to time by the relevant
United States taxing authorities) as may be (i) notified by the Company or
Agent to such Bank and (ii) required under then-current United States law or
regulations to establish an available exemption from United States withholding
taxes on payments in respect of all amounts to be received by such Bank,
including fees, pursuant to this Agreement or the Loans. Upon the request of
the Company or Agent, each Bank that is a United States person (as such term is
defined in Section 7701(a)(30) of the Code) shall submit to the Company two
accurate and complete signed copies of Internal Revenue Service Form W-9 or any
successor thereto, as appropriate.

 

(b)           Inability of Bank to Submit Forms. If any Bank
determines, as a result of any change in applicable law, regulation or treaty,
or in any official application or interpretation thereof, that it is unable to
submit to the Company any form or certificate that such Bank is obligated to
submit pursuant to subsection (a) of this Section 11.18, or that such Bank is
required to withdraw or cancel any such form or certificate previously
submitted or any such form or certificate otherwise becomes ineffective or
inaccurate, such Bank shall promptly notify the Company and Agent of such fact
and the Bank shall to that extent not be obligated to provide any such form or
certificate and will be entitled to withdraw or cancel any affected form or
certificate, as applicable.

 

36

 

(c)           Payment of Additional Amounts. If, as a
result of any change in applicable law, regulation or treaty, or in any
official application or interpretation thereof after the date of this Agreement
or, if later, the date a bank becomes a Bank hereunder, the Company is required
by law or regulation to make any deduction, withholding or backup withholding
of any taxes, levies, imposts, duties, fees, liabilities or similar charges of
the United States of America, any possession or territory of the United States
of America (including the Commonwealth of Puerto Rico) or any area subject to
the jurisdiction of the United States of America (“U.S. Taxes”) from any
payments to a Bank in respect of Loans then or thereafter outstanding, or other
amounts owing hereunder, the amount payable by the Company will be increased to
the amount which, after deduction from such increased amount of all U.S. Taxes
required to be withheld or deducted therefrom, will yield the amount required
under this Agreement to be payable with respect thereto; provided that the
Company shall not be required to pay any additional amount pursuant to this
subsection (c) to any Bank that (i) is not, on the date this Agreement is
executed by such Bank or, if later, the date such Bank became a Bank hereunder,
either (x) entitled to submit Form W-8 BEN relating to such Bank and entitling
it to a complete exemption from withholding on all amounts to be received by
such Bank, including fees, pursuant to this Agreement and the Loans, Form W-8
BEN relating to all amounts to be received by such Bank, including fees,
pursuant to this Agreement and the Loans or Form W-8 BEN relating to such Bank
and entitling it to a complete exemption from withholding on all amounts to be
received by such Bank, including fees, pursuant to this Agreement and the Loans
(or, in any such case, such successor forms as shall be adopted from time to
time by the Internal Revenue Service), or (y) a U.S. person (as such term is
defined in Section 7701(a)(30) of the Code), or (ii) has failed to submit any
form or certificate that it was required to file pursuant to subsection (a) of
this Section 11.18 and entitled to file under applicable law, or (iii) is
no longer entitled to submit Form W-8 BEN or Form W-8 ECI as a result of any
change in circumstances other than a change in applicable law, regulation or
treaty or in any official application or the account of any Bank pursuant to
this subsection (c), then such Bank will agree to use reasonable efforts to
change the jurisdiction of its applicable lending office so as to eliminate or
reduce any such additional payment which may thereafter accrue if such change,
in the judgment of such Bank, is not otherwise disadvantageous to such Bank.
Within thirty (30) days after the Company’s payment of any such U.S. Taxes, the
Company shall deliver to the Agent, for the account of the relevant Bank(s),
originals or certified copies of official tax receipts evidencing such payment
thereof or other evidence of payment reasonably satisfactory to the Agent. The
obligations of the Company under this subsection (c) shall survive the payment
in full of the Loans and the termination of the Commitments. If any Bank or the
Agent determines it has received or been granted a refund, credit against,
relief or remission for, or repayment of, any taxes paid or payable by it
because of any U.S. Taxes paid by the Company and evidenced by such a tax
receipt, such Bank or Agent shall, to the extent it can do so without prejudice
to the retention of the amount of such refund, credit, relief, remission or
repayment, pay to the Company such amount as such Bank or Agent determines is
attributable to such deduction or withholding and which will leave such Bank or
Agent (after such payment) in no better or worse position than it would have
been in if the Company had not been required to make such deduction or
withholding. Nothing in this Agreement shall interfere with the right of each
Bank and the Agent to arrange its tax affairs in whatever manner it deems fit
nor oblige any Bank or the Agent to disclose any information relating to its
tax affairs or any computations in connection with such taxes.

 

11.19.      Confidentiality. The Agent and
each Bank will keep confidential any non-public information concerning the
Company and its Subsidiaries furnished by the Company (which is designated by
the Company as confidential at the time such information is furnished to the
Agent or such Bank) or obtained by the Agent or such Bank through its
inspections pursuant to Section 7.5 hereof and known by such Bank to be
confidential, except that the Agent or any Bank may disclose such information
(a) to regulatory authorities having jurisdiction, (b) pursuant to subpoena or
other legal process, (c) to the Agent’s and such Bank’s

 

37

 

counsel
and auditors in connection with matters concerning this Agreement, (d) to the
Agent and such Bank’s consultants in connection with negotiations concerning
this Agreement or the other Loan Documents and (e) to prospective participants
and assignees and participants in the credit extended hereunder, provided that
any Persons described in clauses (d) and (e) shall be bound to comply with the
terms of this Section 11.19. In the situations described above (except where
the Company is a party or where disclosure is made during the course of a
regulatory examination of a Bank), the Agent or the relevant Bank shall notify
the Company as promptly as practicable of the receipt of a request for such
disclosure and furnish it with a copy of such subpoena or other legal process
(to the extent the Agent or such Bank is legally permitted to do so). The
provisions of this Section shall survive the payment of the Notes and the
termination of this Agreement.

 

11.20.      Register. The Agent, on
behalf of the Company, shall maintain at its address referred to in Section
11.7 a copy of each assignment and acceptance delivered to and accepted by it
and a register for the recordation of the names and addresses of the Banks and
each Commitment of, and principal amount of the Loans owing to, each Bank from
time to time (the “Register”). The entries in the Register shall be conclusive
and binding for all purposes, absent manifest error, and the Company, the Agent
and the Banks may treat each Person whose name is recorded in the Register as a
Bank hereunder for all purposes of this Agreement. The Register shall be
available for inspection by the Company or any Bank at any reasonable time and
from time to time upon reasonable prior notice. Upon its receipt of an
assignment and acceptance executed by an assigning Bank, an assignee and the
Company, if required, the Agent shall, if such assignment and acceptance has
been completed and is acceptable to the Agent in form and substance, (a) accept
such assignment and acceptance, (b) record the information contained
therein in the Register and (c) give prompt notice thereof to the Company.

 

11.21.      SPCs. Notwithstanding
anything to the contrary contain herein, any Bank except the Agent, (a “Granting
Bank”) may grant to a special purpose funding vehicle (an “SPC”) the option to
fund all or any part of any Loan that such Granting Bank would otherwise be
obligated to fund pursuant to this Agreement; provided, that (i) nothing herein
shall constitute a commitment by any SPC to fund any Loan, (ii) if an SPC
elects not to exercise such option or otherwise fails to fund all or any part
of such Loan, the Granting Bank shall be obligated to fund such Loan pursuant
to the terms hereof, (iii) no SPC shall have any voting rights pursuant to
Section 11.1 (all such voting rights shall be retained by the Granting Bank)
and (iv) with respect to notices, payments and other matters hereunder, the
Company, the Agent and the Banks shall not be obligated to deal with an SPC,
but may limit their communications and other dealings relevant to such SPC to
the applicable Granting Bank. The funding of a Loan by an SPC hereunder shall
utilize the Commitment of the Granting Bank to the same extent that, and as if,
such Loan were funded by such Granting Bank. Each party hereto hereby agrees
that no SPC shall be liable for any indemnity or payment under this Agreement
for which a Lender would otherwise be liable for so long as, and to the extent,
the Granting Bank provides such indemnity or makes such payment. In furtherance
of the foregoing, each party hereto hereby agrees (which agreements shall
survive 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 senior 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. Notwithstanding anything to the contrary contained
in this Agreement, any SPC may disclose on a confidential basis any non-public
information relating to its funding of Loans to any rating agency, commercial
paper dealer or provider of any surety or guarantee to such SPC. The grant of
an option pursuant to this Section shall not be deemed either an assignment or
a participation pursuant to Section 11.16 or 11.17, respectively, and shall not
reduce the Commitment of the Granting Bank. This Section 11.21 may not be
amended without the prior written consent of each Granting Bank, all or any
part of whose Loan is being funded by an SPC at the time of such amendment.

 

11.22.      Facsimile Signatures. The exchange of copies of this Agreement and of signature pages by
facsimile transmission shall constitute effective execution and delivery of
this Agreement as to the parties and may be used in lieu of the original
Agreement for all purposes. Signatures of the parties transmitted by facsimile
shall be deemed to be their original signatures for all purposes.

 

38

 

11.23.      STATUTORY STATEMENT MADE PURSUANT
TO MO. REV. STAT. §432.045. ORAL AGREEMENTS OR
COMMITMENTS TO LOAN MONEY, EXTEND CREDIT OR TO FORBEAR FROM ENFORCING PAYMENT
OF A DEBT, INCLUDING PROMISES TO EXTEND OR RENEW SUCH DEBT ARE NOT ENFORCEABLE.
TO PROTECT YOU, THE COMPANY, AND US, THE BANKS, FROM MISUNDERSTANDING OR
DISAPPOINTMENT, ANY AGREEMENTS WE REACH COVERING SUCH MATTERS ARE CONTAINED IN
THIS WRITING AND THE DOCUMENTS REFERRED TO HEREIN, WHICH ARE THE COMPLETE AND
EXCLUSIVE STATEMENTS OF THE AGREEMENT BETWEEN US, EXCEPT AS WE MAY LATER AGREE
IN WRITING TO MODIFY IT.

 

[THE
REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK.]

[SIGNATURE PAGES TO FOLLOW]

 

39

 

Upon
your acceptance hereof in the manner hereinafter set forth, this Agreement
shall be a contract between us for the purposes hereinabove set forth.

 

Dated
as of March 14, 2006.

 

	
   

  	
  THE EMPIRE DISTRICT
  ELECTRIC COMPANY 

  
	
   

  	
   

  
	
   

  	
  By:

  	
  Gregory A. Knapp

  	
   

  
	
   

  	
  Its:

  	
  VP Finance & CFO

  	
   

  

 

Accepted and Agreed to as
of the day and year last above written.

 

	
  UMB BANK, N.A., individually and as

  	
  BANK OF AMERICA, N.A.,

  
	
  Administrative Agent

  	
  individually and as Syndication Agent

  
	
   

  	
   

  
	
  By:

  	
  /s/

  	
  Charles J. Wolf

  	
   

  	
  By:

  	
  /s/

  	
  Eric A. Escagne

  	
   

  
	
   

  	
   

  	
  Charles J. Wolf

  	
   

  	
   

  	
  Eric A. Escagne

  
	
  Its: Senior Vice President

  	
  Its: Vice President

  
	
  Address: 1010 Grand Boulevard

  	
  Address: MO1-800-12-01

  
	
  Kansas City, MO 64106

  	
  800 Market Street, 12th Floor

  
	
  Attention: Charles J. Wolf

  	
  St. Louis, MO 63101

  
	
  Telephone No: 816-860-7130

  	
  Attention: Eric A. Escagne

  
	
  Telecopy No.: 816-860-7143

  	
  Telephone No.: 314-466-2126

  
	
  charles.wolf@umb.com

  	
  Telecopy No.: 314-466-6499

  
	
   

  	
  eric.escagne@bankofamerica.com

  
	
   

  	
   

  
	
  M & I MARSHALL & ILSLEY BANK,

  	
  NATIONAL CITY BANK OF THE MIDWEST,

  
	
  individually

  	
  individually

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/

  	
  Gregg Weyer

  	
   

  	
  By:

  	
  /s/

  	
  Eric Hartman

  	
   

  
	
   

  	
   

  	
  Gregg Weyer

  	
   

  	
   

  	
  Eric Hartman

  
	
  Its: Vice President

  	
  Its: Vice President-Wholesale Banking

  
	
  Address:

  	
  770 North Water Street

  	
  Address:

  	
  120 South Central Avenue

  
	
   

  	
  Milwaukee, WI 53202

  	
   

  	
  Locator SL – WB08

  
	
  Attention:

  	
    Nenita Yumang

  	
   

  	
  Clayton, MO 63105

  
	
  Telephone No.:

  	
  262-938-8675

  	
  Attention: Eric Hartman

  
	
  Telecopy No.:

  	
  262-938-8684

  	
  Telephone No.:

  	
  314-898-1205

  
	
  gregg.weyer@micorp.com

  	
  Telecopy No.:

  	
  314-898-1401

  
	
   

  	
  eric.hartman@nationalcity.com

  
														

 

40

 

 

	
  U.S. BANK, NATIONAL ASSOCIATION,

  	
  WELLS FARGO BANK, N.A., individually

  
	
  individually

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/

  	
  Joseph Howard

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Joseph Howard

  	
  By:

  	
  /s/

  	
  Tammy R. Sturgis

  	
   

  
	
  Its:  Vice President

  	
   

  	
   

  	
  Tammy R. Sturgis

  
	
  Address:  One U.S. Bank
  Plaza

  	
  Its:   Vice President

  
	
  Mail Code:  SL-MO-T12M

  	
  Address:  4100 North
  Mulberry Drive, Ste. 105

  
	
  St. Louis, MO 63101

  	
  Kansas City, MO 64116

  
	
  Attention: Joseph Howard

  	
  Attention:  Tammy R.
  Sturgis

  
	
  Telephone No.:

  	
  314-418-8247

  	
  Telephone No.:

  	
  816-584-8416

  
	
  Telecopy No.:

  	
  314-418-3859

  	
  Telecopy No.:

  	
  816-587-9537

  
	
  joseph.howard@usbank.com

  	
  tammy.r.sturgis@wellsfargo.com

  
	
   

  	
   

  
	
   

  	
   

  
	
  COMERICA BANK, individually

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/

  	
  Mark J. Leveille

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Mark J. Leveille

  	
   

  	
   

  	
   

  	
   

  
	
  Its:  Commercial Banking
  Officer

  	
   

  
	
  Address:

  	
  500 Woodward Avenue-MC 3269

  	
   

  
	
   

  	
  Detroit, MI 48226

  	
   

  
	
  Attention:  Mark J.
  Leveille

  	
   

  
	
  Telephone No.:

  	
  313-222-3958

  	
   

  
	
  Telecopy No.:

  	
  313-222-9516

  	
   

  
	
  mjleveille@comerica.com

  	
   

  
													

 

41

 

EXHIBIT
A-1

 

THE
EMPIRE DISTRICT ELECTRIC COMPANY

 

REVOLVING
CREDIT NOTE

 

FOR
VALUE RECEIVED, the undersigned, The Empire District Electric Company, a Kansas
corporation (the “Company”), hereby promises to pay to the order of                             
(the “Bank”) on the Revolving Credit Termination Date (as defined in the Credit
Agreement hereinafter referred to), at the principal office of UMB Bank, N.A.
in Kansas City, Missouri the aggregate unpaid principal amount of all Revolving
Credit Loans made by the Bank to the Company under the Credit Agreement
hereinafter mentioned and remaining unpaid on the Revolving Credit Termination
Date, together with fees and all other amounts due with interest on the
principal amount of each Revolving Credit Loan from time to time outstanding
hereunder at the rates, and payable in the manner and on the dates specified in
said Credit Agreement.

 

The
Bank shall record on its books or records or on the schedule to this Note which
is a part hereof the principal amount of each Revolving Credit Loan made by it
to the Company under the Credit Agreement, all payments of principal and
interest thereon and the principal balances from time to time outstanding;
provided that prior to the transfer of this Note all such amounts shall be
recorded on a schedule attached to this Note. The record thereof, whether shown
on such books or records or on the schedule to this Note, shall be prima facie evidence as to all such amounts absent manifest
error; provided, however, that the failure of
the Bank to record any of the foregoing shall not limit or otherwise affect the
obligation of the Company to repay all Revolving Credit Loans made under the
Credit Agreement, together with accrued interest thereon.

 

This
Note is one of the Revolving Credit Notes referred to in, and issued under,
that certain First Amended and Restated Unsecured Credit Agreement dated as of
March 14, 2006, among the Company, UMB Bank, N.A., individually and as
Administrative Agent, and the Banks named therein, as amended hereafter from
time to time (the “Credit Agreement”) and this Note and the holder hereof are
entitled to all of the benefits provided for thereby or referred to therein. All
defined terms used in this Note, except terms otherwise defined herein, shall
have the same meaning as such terms have in said Credit Agreement.

 

Prepayments
may be made, and are sometimes required to be made, on any Loan evidenced
hereby and this Note (and the Revolving Credit Loans evidenced hereby) may be
declared due prior to the expressed maturity thereof, all in the events, on the
terms and in the manner as provided for in said Credit Agreement.

 

All
agreements between the Company and the Bank, whether now existing or hereafter
arising and whether written or oral, are expressly limited so that in no
contingency or event whatsoever, whether by reason of demand or acceleration of
the maturity of any of the indebtedness hereunder or otherwise, shall the
amount contracted for, charged, received, reserved, paid or agreed to be paid
to or for the benefit of the Bank for the use, forbearance, or detention of the
funds advanced hereunder or otherwise, or for the performance or payment of any
covenant or obligation contained in any document executed in connection
herewith (all such documents being hereinafter collectively referred to as the “Loan
Documents”), exceed the maximum lawful rate or amount of interest permissible
under applicable law (the “Highest Lawful Rate”), it being the intent of the
Company and the Bank in the execution hereof and of the Loan Documents to
contract in strict accordance with applicable usury laws. If, as a result of
any circumstances whatsoever, performance by the Company of any provision
hereof or of any of

 

A-1-1

 

such
documents, at the time performance of such provision shall be due, shall
involve exceeding the limits of applicable usury laws or result in the Bank
having or being deemed to have contracted for, charged, reserved or received
interest (or amounts deemed to be interest) in excess of the Highest Lawful
Rate to be so contracted for, charged, reserved or received by the Bank, then,
the obligation to be performed by the Company shall be reduced to the legal
limit of such performance, and if, from any such circumstance, the Bank shall
ever receive interest or anything which might be deemed interest under
applicable law which would exceed the Highest Lawful Rate, such amount which
would be unlawful interest shall be refunded to the Company or, to the extent
(i) permitted by applicable law and (ii) such unlawful interest does not exceed
the unpaid principal balance of the Note and the amounts owing on other
obligations of the Company to the Bank under any Loan Document applied to the
reduction of the principal amount owing on account of the Notes or the amounts
owing on other obligations of the Company to the Bank under any Loan Document
and not to the payment of interest. All interest paid, or agreed to be paid, to
or for the benefit of the Bank shall, to the extent permitted by applicable
law, be amortized, prorated, allocated, and spread throughout the full period
of the indebtedness hereunder until payment in full of the principal of the
indebtedness hereunder (including the period of any renewal or extension
thereof) so that the interest on account of the indebtedness hereunder for such
full period shall not exceed the highest amount permitted by applicable law.

 

The
undersigned hereby expressly waives diligence, presentment, demand, protest,
notice of protest, notice of intent to accelerate, notice of acceleration, and
notice of any other kind.

 

This
Note is governed by and shall be construed in accordance with the internal laws
of the State of Missouri.

 

	
   

  	
  THE EMPIRE DISTRICT
  ELECTRIC COMPANY 

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  

 

A-1-2

 

EXHIBIT
A-2

 

THE
EMPIRE DISTRICT ELECTRIC COMPANY

 

LETTER OF
CREDIT NOTE

 

March 14, 2006

 

FOR
VALUE RECEIVED, the undersigned, The Empire District Electric Company, a Kansas
corporation (the “Company”), hereby promises to pay to the order of                                 
(the “Bank”) on the Credit Termination Date (as defined in the Credit Agreement
hereinafter referred to), at the principal office of UMB Bank, N.A. in Kansas
City, Missouri the aggregate unpaid principal amount of all Letter of Credit
Loans made by the Bank to the Company under the Credit Agreement hereinafter
mentioned and remaining unpaid on the Credit Termination Date, together with
fees and all other amounts due with interest on the principal amount of each
Letter of Credit Loan from time to time outstanding hereunder at the rates, and
payable in the manner and on the dates specified in said Credit Agreement.

 

The
Bank shall record on its books or records or on the schedule to this Note which
is a part hereof the principal amount of each Letter of Credit Loan made by it
to the Company under the Credit Agreement, all payments of principal and
interest thereon and the principal balances from time to time outstanding;
provided that prior to the transfer of this Note all such amounts shall be
recorded on a schedule attached to this Note. The record thereof, whether shown
on such books or records or on the schedule to this Note, shall be prima facie evidence as to all such amounts absent manifest
error; provided, however, that the failure of
the Bank to record any of the foregoing shall not limit or otherwise affect the
obligation of the Company to repay all Letter of Credit Loans made under the
Credit Agreement, together with accrued interest thereon.

 

This
Note is one of the Letter of Credit Notes referred to in, and issued under,
that certain First Amended and Restated Unsecured Credit Agreement dated as of
March 14, 2006, among the Company, UMB Bank, N.A., individually and as
Administrative Agent, and the Banks named therein, as amended hereafter from
time to time (the “Credit Agreement”) and this Note and the holder hereof are
entitled to all of the benefits provided for thereby or referred to therein. All
defined terms used in this Note, except terms otherwise defined herein, shall
have the same meaning as such terms have in said Credit Agreement.

 

Prepayments
may be made, and are sometimes required to be made, on any Loan evidenced
hereby and this Note (and the Letter of Credit Loans evidenced hereby) may be
declared due prior to the expressed maturity thereof, all in the events, on the
terms and in the manner as provided for in said Credit Agreement.

 

All
agreements between the Company and the Bank, whether now existing or hereafter
arising and whether written or oral, are expressly limited so that in no
contingency or event whatsoever, whether by reason of demand or acceleration of
the maturity of any of the indebtedness hereunder or otherwise, shall the
amount contracted for, charged, received, reserved, paid or agreed to be paid
to or for the benefit of the Bank for the use, forbearance, or detention of the
funds advanced hereunder or otherwise, or for the performance or payment of any
covenant or obligation contained in any document executed in connection
herewith (all such documents being hereinafter collectively referred to as the “Loan
Documents”), exceed the maximum lawful rate or amount of interest permissible
under applicable law (the “Highest Lawful Rate”), it being the intent of the
Company and the Bank in the execution hereof and of the Loan Documents to
contract in strict accordance with applicable usury laws. If, as a result of
any circumstances whatsoever, performance by the Company of any provision
hereof or of any of

 

A-2-1

 

such
documents, at the time performance of such provision shall be due, shall
involve exceeding the limits of applicable usury laws or result in the Bank
having or being deemed to have contracted for, charged, reserved or received
interest (or amounts deemed to be interest) in excess of the Highest Lawful
Rate to be so contracted for, charged, reserved or received by the Bank, then,
the obligation to be performed by the Company shall be reduced to the legal
limit of such performance, and if, from any such circumstance, the Bank shall
ever receive interest or anything which might be deemed interest under
applicable law which would exceed the Highest Lawful Rate, such amount which
would be unlawful interest shall be refunded to the Company or, to the extent
(i) permitted by applicable law and (ii) such unlawful interest does not exceed
the unpaid principal balance of the Note and the amounts owing on other
obligations of the Company to the Bank under any Loan Document applied to the
reduction of the principal amount owing on account of the Notes or the amounts
owing on other obligations of the Company to the Bank under any Loan Document
and not to the payment of interest. All interest paid, or agreed to be paid, to
or for the benefit of the Bank shall, to the extent permitted by applicable
law, be amortized, prorated, allocated, and spread throughout the full period
of the indebtedness hereunder until payment in full of the principal of the
indebtedness hereunder (including the period of any renewal or extension
thereof) so that the interest on account of the indebtedness hereunder for such
full period shall not exceed the highest amount permitted by applicable law.

 

The
undersigned hereby expressly waives diligence, presentment, demand, protest,
notice of protest, notice of intent to accelerate, notice of acceleration, and
notice of any other kind.

 

This
Note is governed by and shall be construed in accordance with the internal laws
of the State of Missouri.

 

 

	
   

  	
  THE EMPIRE DISTRICT
  ELECTRIC COMPANY

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
							

 

A-2-2

 

EXHIBIT
B

THE
EMPIRE DISTRICT ELECTRIC COMPANY

 

PRICING
SCHEDULE

 

	
  Basis for

  Pricing

  	
   

  	
  Level I

  A- / A3

  	
   

  	
  Level II

  BBB+/Baa1

  	
   

  	
  Level III

  BBB/Baa2

  	
   

  	
  Level IV

  BBB-/Baa3

  	
   

  	
  Level V

  BB+ / Ba1

  	
   

  	
  Level VI

  <BB+ / Ba1

  	
   

  
	
  Applicable Margin for
  ABR Portions

  	
   

  	
  0.0 

  	
  bps

  	
  0.0

  	
  bps

  	
  0.0

  	
  bps

  	
  0.0

  	
  bps

  	
  50.0

  	
  bps

  	
  100.0

  	
  bps

  
	
  Applicable Margin for
  LIBOR Portions

  	
   

  	
  62.5

  	
  bps

  	
  75.0

  	
  bps

  	
  80.0

  	
  bps

  	
  100.0

  	
  bps

  	
  145.0

  	
  bps

  	
  170.0

  	
  bps

  
	
  Facility Fee Rate

  	
   

  	
  15.0

  	
  bps

  	
  17.5

  	
  bps

  	
  22.0

  	
  bps

  	
  31.5

  	
  bps

  	
  40.0

  	
  bps

  	
  45.0

  	
  bps

  
	
  Utilization Fee Rate

  	
   

  	
  12.5

  	
  bps

  	
  12.5

  	
  bps

  	
  12.5

  	
  bps

  	
  12.5

  	
  bps

  	
  25.0

  	
  bps

  	
  25.0

  	
  bps

  
	
  Letter of Credit Fee
  Rate

  	
   

  	
  62.5

  	
  bps

  	
  75.0

  	
  bps

  	
  80.0

  	
  bps

  	
  100.0

  	
  bps

  	
  145.0

  	
  bps

  	
  170.0

  	
  bps

  
	
  Drawn Cost (<33%
  usage)

  	
   

  	
  77.5

  	
  bps

  	
  92.5

  	
  bps

  	
  102.0

  	
  bps

  	
  131.5

  	
  bps

  	
  185.0

  	
  bps

  	
  215.0

  	
  bps

  
	
  Drawn Cost (>33%
  usage)

  	
   

  	
  90.0

  	
  bps

  	
  105.0

  	
  bps

  	
  114.5

  	
  bps

  	
  144.0

  	
  bps

  	
  210.0

  	
  bps

  	
  240.0

  	
  bps

  

 

For purposes of utilizing
the above schedule:

 

“Level
I Status” exists at any date if, on such date, the Company’s Moody’s Rating is
A3 or better or the Company’s S & P Rating is A- or better.

 

“Level
II Status” exists at any date if, on such date, (i) the Company has not
qualified for Level I Status and (ii) the Company’s Moody’s Rating is Baa1 or
better or the Company’s S & P Rating is BBB+ or better.

 

“Level
III Status” exists at any date if, on such date, (i) the Company has not
qualified for Level I or II Status and (ii) the Company’s Moody’s Rating is
Baa2 or better or the Company’s S & P Rating is BBB or better.

 

“Level
IV Status” exists at any date if, on such date, (i) the Company has not
qualified for Level I, II or III Status and (ii) the Company’s Moody’s Rating
is Baa3 or better or the Company’s S & P Rating is BBB- or
better.

 

“Level
V Status” exists at any date if, on such date, (i) the Company has not
qualified for Level I, II, III or IV Status and (ii) the Company’s Moody’s
Rating is Ba1 or better or the Company’s S & P Rating is BB+ or better.

 

“Level
VI Status” exists at any date if, on such date, the Company has not qualified
for Level I, II, III, IV or V Status.

 

B-1

 

“Moody’s
Rating” means, at any time, the rating issued by Moody’s Investors Service and
then in effect with respect to the Company’s senior unsecured long-term debt
securities without third-party credit enhancement.

 

“S
& P Rating” means, at any time, the rating issued by Standard & Poor’s
and then in effect with respect to the Company’s senior unsecured long-term
debt securities without third-party credit enhancement.

 

“Status”
means Level I Status, Level II Status, Level III Status, Level IV Status, Level
V Status or Level VI Status.

 

The
Applicable Margin and Applicable Fee Rate shall be determined from time to time
in accordance with the foregoing schedule based on the Company’s Status as
determined from its then-current Moody’s Rating and/or S & P Rating; provided, that, if the Company has neither a Moody’s Rating
nor an S & P Rating at closing, Level VI shall apply until the Company
first receives either a Moody’s Rating or an S & P Rating. The credit
rating in effect on any date for the purposes of the foregoing schedule is that
in effect at the close of business on such date. If, at any time, the Company
has neither a Moody’s Rating nor an S & P Rating, Level VI Status shall
exist. If, at any time the Company has only a Moody’s Rating or an S & P Rating,
but not both, the Status shall be determined by reference to such rating.

 

If the Company is
split-rated and the differential between ratings is one level, the higher
rating will apply. If the Company is split-rated and the differential between
ratings is two levels or more, the intermediate ratings at the midpoint will
apply. If there is no midpoint, the higher of the two intermediate ratings will
apply.

 

B-2

 

EXHIBIT
C

THE
EMPIRE DISTRICT ELECTRIC COMPANY

 

SUBSIDIARIES
OF THE COMPANY

 

	
  Subsidiary

  	
   

  	
  State of Organization

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  EDE Holdings,
  Inc.

  	
   

  	
  Delaware

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Empire District
  Industries, Inc.

  	
   

  	
  Delaware

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Fast Freedom,
  Inc.

  	
   

  	
  Missouri

  	
   

  
	
  Conversant, Inc.

  	
   

  	
  Delaware

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Mid-America
  Precision Products, L.L.C.

  	
   

  	
  Missouri

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Utility
  Intelligence, Inc.

  	
   

  	
  Missouri

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  EDE Property
  Transfer Corp.

  	
   

  	
  Delaware

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  The Empire
  District Gas Company

  	
   

  	
  Kansas

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Empire District
  Electric Arkansas, L.L.C.

  	
   

  	
  Arkansas

  	
   

  

 

C-1

 

EXHIBIT
D-1

THE
EMPIRE DISTRICT ELECTRIC COMPANY

 

COMPANY’S
KANSAS COUNSEL’S OPINION

 

(TO
BE RETYPED ON LETTERHEAD OF ANDERSON & BYRD

AND
DATED AS OF DATE OF CLOSING)

 

July
15, 2005

 

UMB
Bank, N.A., Individually and as

Administrative
Agent

1010
Grand Boulevard

Kansas
City, Missouri 64106

 

The
Banks From Time to Time Party

to the
Credit Agreement described below

 

Ladies and Gentlemen:

 

We
act as Kansas counsel to The Empire District Electric Company, a Kansas
corporation (the “Company”). We are delivering this opinion to you pursuant to
Section 5.1(b) of the Five Year $150,000,000 Unsecured Credit Agreement dated
as of July 15, 2005 among the Company, UMB Bank, N.A., individually and as
Administrative Agent, Bank of America, N.A., individually and as Syndication
Agent, and the other financial institutions party thereto (the “Credit
Agreement”).

 

We
have examined executed originals of, the instruments and documents identified
on Exhibit A to this letter (collectively, the “Loan Documents”, individual
Loan Documents and other capitalized terms used below being hereinafter
referred to by the designations appearing on Exhibit A). We have also reviewed
records of all corporate proceedings necessary to authorize the execution and
delivery of the Loan Documents. Capitalized terms used herein but not otherwise
defined shall have the meanings set forth in the Credit Agreement.

 

We
have also reviewed the restated articles of incorporation, as amended, and
by-laws of the Company (the “Organizational Documents”) and examined such other
instruments and records and inquired into such other factual matters and
matters of law as we deem necessary or pertinent to the formulation of the
opinions hereinafter expressed.

 

Based
on the foregoing, we are of the opinion that:

 

1.             The Company has
been duly incorporated and is validly existing as a corporation in good
standing under the laws of the State of Kansas with power and authority
(corporate and other) to own its properties and conduct its business as
currently conducted.

 

2.             Each of the
Loan Documents executed by the Company has been duly authorized executed and
delivered by the Company and constitutes a valid and binding agreement of the
Company enforceable in accordance with its terms, except as the same may be
limited by bankruptcy, insolvency, reorganization or other laws affecting the
enforcement of creditor’s rights or by general principles of equity.

 

3.             All approvals
of the State Corporation Commission of the State of Kansas which are required
for the lawful execution and delivery of the Loan Documents have been obtained;

 

D-1-1

 

any
conditions in such approvals required to be satisfied prior to the lawful
execution and delivery of the Loan Documents have been duly satisfied; such
approvals are in full force and effect; and no further approval, authorization,
consent or other order of any public board or body in the State of Kansas is
legally required for the lawful execution and delivery of the Loan Documents.

 

Respectfully submitted,

 

D-1-2

 

EXHIBIT
A

 

THE
LOAN DOCUMENTS

 

All
Loan Documents are dated as of July 15, 2005.

 

1.             The Five Year
$150,000,000 Unsecured Credit Agreement dated as of July 15, 2005 among the
Company, UMB Bank, N.A. (“UMB”), individually and as Administrative Agent, Bank
of America, N.A. (“B of A”), individually and as Syndication Agent and the
other financial institutions party thereto.

 

2.             Revolving
Credit Note of the Company payable to the order of UMB.

 

3.             Revolving
Credit Note of the Company payable to the order of B of A.

 

4.             Revolving
Credit Note of the Company payable to the order of M&I Marshall &
Ilsley Bank.

 

5.             Revolving
Credit Note of the Company payable to the order of National City Bank.

 

6.             Revolving
Credit Note of the Company payable to the order of Wells Fargo Bank, N.A.

 

7.             Revolving
Credit Note of the Company payable to the order of Comerica Bank.

 

8.             Revolving
Credit Note of the Company payable to the order of U.S. Bank, National
Association.

 

D-1-3

 

EXHIBIT
D-2

THE
EMPIRE DISTRICT ELECTRIC COMPANY

 

COMPANY’S
MISSOURI COUNSEL’S OPINION

 

(TO
BE RETYPED ON LETTERHEAD OF SPENCER, SCOTT & DWYER, P.C.

AND
DATED AS OF DATE OF CLOSING)

 

July
15, 2005

 

UMB
Bank, N.A., Individually and as

Administrative
Agent

1010
Grand Boulevard

Kansas
City, Missouri 64106

 

The
Banks From Time to Time Party

to the
Credit Agreement described below

 

Ladies and Gentlemen:

 

We
act as counsel to The Empire District Electric Company, a Kansas corporation
(the “Company”). We are delivering this opinion to you pursuant to Section
5.1(b) of the Five Year $150,000,000 Unsecured Credit Agreement dated as of
July 15, 2005 among the Company, UMB Bank, N.A., individually and as
Administrative Agent, Bank of America, N.A., individually and as Syndication
Agent, and the other financial institutions party thereto (the “Credit
Agreement”).

 

We
have examined executed originals of, the instruments and documents identified on
Exhibit A to this letter (collectively, the “Loan Documents”, individual Loan
Documents and other capitalized terms used below being hereinafter referred to
by the designations appearing on Exhibit A). We have also reviewed records of
all corporate proceedings necessary to authorize the execution and delivery of
the Loan Documents. Capitalized terms used herein but not otherwise defined
shall have the meanings set forth in the Credit Agreement.

 

We
have also reviewed the restated articles of incorporation, as amended, and
by-laws of the Company (the “Organizational Documents”) and examined such other
instruments and records and inquired into such other factual matters and
matters of law as we deem necessary or pertinent to the formulation of the
opinions hereinafter expressed.

 

Based
on the foregoing and our knowledge of the affairs of the Company (and, to the
extent indicated below upon the opinion of other counsel hereinafter referred
to), we are of the opinion that:

 

1.             The Company has
been duly incorporated and is validly existing and in good standing under the
laws of the State of Kansas, with power and authority (corporate and other) to
own its properties and conduct its business as a foreign corporation in good
standing in the States of Arkansas, Missouri and Oklahoma, which are the only
jurisdictions (other than Kansas) in which it owns or leases substantial
properties or in which the conduct of its business requires such qualification.

 

2.             None of the
execution, delivery or performance by the Company of its obligations under any
of the Loan Documents will conflict with, violate or result in a breach of any
Missouri law or administrative regulation or any court decree known to us
applicable to the Company (it being understood that we need express no opinion
as to matters subject to the jurisdiction of the Public Service Commission of
the State of Missouri, the Corporation Commission of Oklahoma,

 

D-2-1

 

the
State Corporation Commission of the State of Kansas or the Arkansas Public
Service Commission), conflict with or result in a breach of any of the terms,
conditions or provisions of the Organizational Documents, or of any agreement
or instrument known to us to which the Company is a party or by which the
Company is bound or constitute a default thereunder, or result in the creation
or imposition of any lien, charge or encumbrance of any nature whatsoever upon
any of the properties or assets of the Company.

 

3.             We have no
actual knowledge of any legal or arbitral proceedings or any proceedings by or
before any governmental or regulatory authority, now pending or threatened in
writing against the Company that, if adversely determined, would have a Material
Adverse Effect (as such term is defined in the Credit Agreement).

 

In
rendering this opinion, we have relied as to the incorporation of the Company
and all other matters governed by Kansas law upon the opinion of Anderson &
Byrd, rendered to you pursuant to Section 5.1(b) of the Credit Agreement.

 

Respectfully submitted,

 

D-2-2

 

EXHIBIT
A

 

THE
LOAN DOCUMENTS

 

All
Loan Documents are dated as of July 15, 2005.

 

1.             The Five Year
$150,000,000 Unsecured Credit Agreement dated as of July 15, 2005 among the
Company, UMB Bank, N.A. (“UMB”), individually and as Administrative Agent, Bank
of America, N.A. (“B of A”), individually and as Syndication Agent and the
other financial institutions party thereto.

 

2.             Revolving
Credit Note of the Company payable to the order of UMB.

 

3.             Revolving
Credit Note of the Company payable to the order of B of A.

 

4.             Revolving
Credit Note of the Company payable to the order of M&I Marshall &
Ilsley Bank.

 

5.             Revolving
Credit Note of the Company payable to the order of NATIONAL CITY BANK.

 

6.             Revolving
Credit Note of the Company payable to the order of Wells Fargo Bank, N.A.

 

7.             Revolving
Credit Note of the Company payable to the order of Comerica Bank.

 

8.             Revolving
Credit Note of the Company payable to the order of U.S. Bank, National Association.

 

D-2-3

 

EXHIBIT
E

THE
EMPIRE DISTRICT ELECTRIC COMPANY

 

QUARTERLY
COMPLIANCE CERTIFICATE

 

This
Quarterly Compliance Certificate is furnished to UMB Bank, N.A. and the other
Banks (collectively, the “Banks”) and UMB Bank, N.A. as Administrative Agent
(the “Agent”) for the Banks, pursuant to that certain First Amended and
Restated Unsecured Credit Agreement dated as of March 14, 2006, by and
among The Empire District Electric Company (the “Company”), the Agent and the
Banks (the “Agreement”). Unless otherwise defined herein, the terms used in
this Compliance Certificate and Schedule I hereto have the meanings ascribed
thereto in the Agreement.

 

The
Undersigned Hereby Certifies on Behalf of the Company That:

 

1.             I am the duly
elected Chief Financial Officer of the Company;

 

2.             I have reviewed
the terms of the Agreement and I have made, or have caused to be made under my
supervision, a detailed review of the transactions and financial condition of
the Company during the accounting period covered by the attached financial
statements sufficient for me to provide this Quarterly Compliance Certificate;

 

3.             The
examinations described in paragraph 2 did not disclose, and I have no knowledge
of, the existence of any condition or event which constitutes an Event of
Default either during or at the end of the accounting period covered by the
Compliance Calculations (defined below) attached hereto, except as set forth
below;

 

4.             Schedule I
attached hereto sets forth financial computations evidencing the Company’s
compliance with the covenants set forth in Sections 7.14 and 7.15 of the
Agreement (the “Compliance Calculations”), all of which computations are true,
complete and correct; and

 

5.             As of the end
of the accounting period covered by this Quarterly Compliance Certificate, the
Company hereby confirms that all of the representations and warranties set
forth in Section 6 of the Agreement were true and correct in all material
respects (except for those representations and warranties expressly limited by
their term to specific dates, which representations were true and correct in
all materials respects as of such other dates) except as set forth below.

 

Described
below are the exceptions, if any, to paragraphs 3 and 5 above by listing, in
detail, the nature of the condition or event, the period during which it
existed or has existed and the action which the Company has taken, is taking or
proposes to take with respect to each such condition or event:

 

 

 

 

E-1

 

The
foregoing certifications, together with the Compliance Computations set forth
in Schedule I hereto are made and delivered this           
day of                          ,
20    .

 

 

	
   

  	
  THE EMPIRE DISTRICT
  ELECTRIC COMPANY 

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
  Chief
  Financial Officer

  
						

 

E-2

 

SCHEDULE
I

TO
COMPLIANCE CERTIFICATE

 

THE
EMPIRE DISTRICT ELECTRIC COMPANY

 

COMPLIANCE
CALCULATIONS FOR FIRST AMENDED AND RESTATED CREDIT AGREEMENT

DATED MARCH 14, 2006

CALCULATIONS
AS OF                     ,
20   

 

	
  Section 7.14

  	
   

  	
  Maximum Total
  Indebtedness To Total Capitalization Ratio

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (a)

  	
   

  	
  Long-term Debt

  	
   

  	
  $

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (b)

  	
   

  	
  Current Maturities of

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Long-term Debt

  	
  plus

  	
   

  	
  $

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (c)

  	
   

  	
  Capital Leases

  	
   

  	
  plus

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
  (d)

  	
   

  	
  Short-term Debt
  (commercial

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  paper and notes
  payable)

  	
  plus

  	
   

  	
  $

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (e)

  	
   

  	
  Other Indebtedness

  	
   

  	
  plus

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
  (f)

  	
   

  	
  Junior Subordinated
  Debentures

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  issued in 2001 by

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  the Company

  	
   

  	
  less

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Total Indebtedness

  	
   

  	
  =

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (aa)

  	
   

  	
  Total Indebtedness

  	
   

  	
   

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
  (bb)

  	
   

  	
  Common Stockholders’
  Equity

  	
  plus

  	
   

  	
  $

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (cc)

  	
   

  	
  Preferred Stock

  	
  plus

  	
   

  	
  $

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (ee)

  	
   

  	
  Other Securities
  including Junior

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Subordinated Debentures

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  issued in 2001 by

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  the Company

  	
   

  	
  plus

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Total Capitalization

  	
   

  	
  =

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Total
  Indebtedness

  	
  =

  	
   

  	
  $

  	
   

  	
   

  	
   

  	
  =

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Total
  Capitalization

  	
   

  	
   

  	
  $

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  1

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Required to be no more
  than 0.625 to 1.

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Compliance as of
  Calculation Date:

  	
  Yes

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  No

  	
   

  	
   

  	
   

  
																								

 

E-3

 

	
  Section 7.15

  	
   

  	
  Minimum Interest
  Coverage Ratio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (a)

  	
   

  	
  Net Income

  	
   

  	
   

  	
   

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
  (b)

  	
   

  	
  Interest Expense

  	
  plus

  	
   

  	
  $

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (c)

  	
   

  	
  Income Taxes

  	
   

  	
   

  	
  plus

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
  (d)

  	
   

  	
  Depreciation

  	
   

  	
   

  	
  plus

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
  (e)

  	
   

  	
  Amortization

  	
   

  	
   

  	
  plus

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  EBITDA

  	
   

  	
   

  	
   

  	
  =

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (aa)

  	
   

  	
  Interest on Loans

  	
   

  	
   

  	
   

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
  (bb)

  	
   

  	
  Imputed interest on
  capitalized

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  leases

  	
   

  	
   

  	
   

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
  (cc)

  	
   

  	
  Amortization of
  discount of

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Indebtedness

  	
   

  	
   

  	
   

  	
   

  	
  $

  	
   

  	
   

  
	
   

  	
  (dd)

  	
   

  	
  All other interest
  expense

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  including interest on
  Junior

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Subordinated Debentures

  	
   

  	
   

  	
  $

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Interest Charges

  	
   

  	
   

  	
   

  	
  =

  	
  $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Interest Coverage Ratio

  	
  =

  	
  EBITDA

  	
   

  	
  =

  	
   

  	
  $

  	
   

  	
   

  	
  =

  	
  $

  
	
   

  	
   

  	
   

  	
   

  	
  Interest Charges

  	
   

  	
   

  	
   

  	
   

  	
    $

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Required to be no less
  than 2.0 to 1

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Compliance as of
  Calculation Date:

  	
  Yes

  	
   

  	
   

  	
   

  	
   

  	
  No

  	
   

  	
   

  	
   

  
																	

 

E-4

 

EXHIBIT
F

THE
EMPIRE DISTRICT ELECTRIC COMPANY

 

EXISTING
LIENS

 

Liens
on assets of Mid-American Precision Products, LLC (MAPP) securing long-term
debt issued by MAPP of which EDE Holdings, Inc. is 52% guarantor of $2.4
million note.

 

F-1

 

EXHIBIT
G

THE
EMPIRE DISTRICT ELECTRIC COMPANY

 

LETTER
OF CREDIT

 

	
  ISSUING
  BANK:

  	
   

  	
  IRREVOCABLE
  STANDBY CREDIT

  
	
  UMB
  Bank N.A.

  	
   

  	
  NUMBER:

  
	
  International
  Trade Services

  	
   

  	
   

  
	
  906
  Grand Boulevard

  	
   

  	
   

  
	
  Kansas
  City, Missouri 64106 U.S.A.

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  PLACE
  AND DATE OF ISSUE:

  	
   

  	
  EXPIRY
  DATE AND PLACE FOR

  
	
  March
  14, 2006

  	
   

  	
  PRESENTATION
  OF DOCUMENTS:

  
	
  Kansas
  City, Missouri 64106 U.S.A.

  	
   

  	
  July
  15, 2007 at our Counters

  
	
   

  	
   

  	
   

  
	
  APPLICANT:

  	
   

  	
  BENEFICIARY:

  
	
  The
  Empire District Electric Company

  	
   

  	
  LSP
  Services Plum Point, LLC

  
	
  602
  Joplin Street

  	
   

  	
  As
  Project Management Company

  
	
  Joplin,
  Missouri 64801

  	
   

  	
  c/o
  LS Power Development, LLC

  
	
   

  	
   

  	
  Two
  Tower Center, 11th Floor

  
	
   

  	
   

  	
  East
  Brunswick, NJ 08816

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  AVAILABLE
  AMOUNT:

  
	
   

  	
   

  	
  USD76,000,000.00

  
	
   

  	
   

  	
  Seventy
  Six Million and 00/100

  
	
   

  	
   

  	
  U.S.
  Dollars

  

 

Re:          Plum
Point Power Project

 

At the request of and for
the account of The Empire District Electric Company, a Kansas corporation,
(hereinafter referred to as the “Applicant”), we hereby establish, effective
immediately, our Irrevocable Standby Letter of Credit in the aggregate amount
of USD76,000,000.00 (this “Letter of Credit”), in favor of LSP Services Plum
Point, LLC as Project Management Company under that certain Project Management
Agreement dated as of March 3, 2006, or its transferee or transferees
(hereinafter referred to as the “Beneficiary” or “Beneficiaries”), available
upon delivery of draft(s) at sight drawn on UMB Bank, N.A. and this original
Letter of Credit and amendments, if any, to us accompanied by your demand(s)
drawn on us.

 

All demands so drawn must
be in the form of Exhibit “A” hereto and payment thereof will be made to only
one account.

 

This Letter of Credit
shall expire on July 15, 2007, unless extended as expressly provided herein
(the “Initial Expiration Date”).

 

Each draft must be marked
“Drawn under UMB Bank, N.A. Letter of Credit No.                  
dated                  .”

 

Partial drawings are
allowed under this Letter of Credit. In addition, we hereby acknowledge that
pursuant to the terms of this Letter of Credit, upon our honoring the sight
draft(s), the amount of this Letter of Credit and the amounts available to be
drawn by the Beneficiary or Beneficiaries hereunder by any subsequent sight
draft(s) are automatically and permanently decreased by an amount equal to the
amount of such sight draft. Multiple drawings may be presented under this
Letter of Credit, which in the aggregate, and subject to the limitations set
forth herein,

 

G-1

 

shall not exceed the
Available Amount then in effect, and each such drawing honored by us hereunder
shall reduce the Available Amount by the amount of such drawing.

 

It is a condition of this
Letter of Credit that, provided it is allowed to extend as set forth herein,
the amount will automatically and permanently reduce by the amounts and on the
dates as per the following reduction schedule unless we receive a direction in
the form of Exhibit “C” hereto at least ten (10) days prior to any Reduction
Date from the Beneficiary or Beneficiaries to not reduce the Available Amount
by the applicable Reduced Amount on such Reduction Date.

 

	
  Reduction Date

  	
   

  	
  Reduced Amount

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  4/1/2006

  	
   

  	
   

  	
  $

  	
  1,500,000

  	
   

  
	
  5/1/2006

  	
   

  	
   

  	
  —

  	
   

  
	
  6/1/2006

  	
   

  	
   

  	
  $

  	
  500,000

  	
   

  
	
  7/1/2006

  	
   

  	
   

  	
  $

  	
  1,000,000

  	
   

  
	
  8/1/2006

  	
   

  	
   

  	
  $

  	
  1,500,000

  	
   

  
	
  9/1/2006

  	
   

  	
   

  	
  $

  	
  1,000,000

  	
   

  
	
  10/1/2006

  	
   

  	
   

  	
  $

  	
  2,000,000

  	
   

  
	
  11/1/2006

  	
   

  	
   

  	
  $

  	
  1,500,000

  	
   

  
	
  12/1/2006

  	
   

  	
   

  	
  $

  	
  500,000

  	
   

  
	
  1/1/2007

  	
   

  	
   

  	
  $

  	
  1,500,000

  	
   

  
	
  2/1/2007

  	
   

  	
   

  	
  $

  	
  500,000

  	
   

  
	
  3/1/2007

  	
   

  	
   

  	
  $

  	
  1,500,000

  	
   

  
	
  4/1/2007

  	
   

  	
   

  	
  $

  	
  1,500,000

  	
   

  
	
  5/1/2007

  	
   

  	
   

  	
  $

  	
  2,000,000

  	
   

  
	
  6/1/2007

  	
   

  	
   

  	
  $

  	
  1,500,000

  	
   

  
	
  7/1/2007

  	
   

  	
   

  	
  $

  	
  2,500,000

  	
   

  
	
  8/1/2007

  	
   

  	
   

  	
  $

  	
  1,000,000

  	
   

  
	
  9/1/2007

  	
   

  	
   

  	
  $

  	
  2,000,000

  	
   

  
	
  10/1/2007

  	
   

  	
   

  	
  $

  	
  2,500,000

  	
   

  
	
  11/1/2007

  	
   

  	
   

  	
  $

  	
  2,500,000

  	
   

  
	
  12/1/2007

  	
   

  	
   

  	
  $

  	
  2,500,000

  	
   

  
	
  1/1/2008

  	
   

  	
   

  	
  $

  	
  1,500,000

  	
   

  
	
  2/1/2008

  	
   

  	
   

  	
  $

  	
  3,000,000

  	
   

  
	
  3/1/2008

  	
   

  	
   

  	
  $

  	
  1,500,000

  	
   

  
	
  4/1/2008

  	
   

  	
   

  	
  $

  	
  2,500,000

  	
   

  
	
  5/1/2008

  	
   

  	
   

  	
  $

  	
  2,500,000

  	
   

  
	
  6/1/2008

  	
   

  	
   

  	
  $

  	
  2,500,000

  	
   

  
	
  7/1/2008

  	
   

  	
   

  	
  $

  	
  2,000,000

  	
   

  
	
  8/1/2008

  	
   

  	
   

  	
  $

  	
  2,000,000

  	
   

  
	
  9/1/2008

  	
   

  	
   

  	
  $

  	
  1,500,000

  	
   

  
	
  10/1/2008

  	
   

  	
   

  	
  $

  	
  1,500,000

  	
   

  
	
  11/1/2008

  	
   

  	
   

  	
  $

  	
  1,500,000

  	
   

  
	
  12/1/2008

  	
   

  	
   

  	
  $

  	
  1,500,000

  	
   

  
	
  1/1/2009

  	
   

  	
   

  	
  $

  	
  500,000

  	
   

  
	
  2/1/2009

  	
   

  	
   

  	
  $

  	
  1,500,000

  	
   

  
	
  3/1/2009

  	
   

  	
   

  	
  $

  	
  1,500,000

  	
   

  
	
  4/1/2009

  	
   

  	
   

  	
  $

  	
  1,500,000

  	
   

  
	
  5/1/2009

  	
   

  	
   

  	
  $

  	
  1,000,000

  	
   

  
	
  6/1/2009

  	
   

  	
   

  	
  $

  	
  2,000,000

  	
   

  
	
  7/1/2009

  	
   

  	
   

  	
  $

  	
  500,000

  	
   

  
	
  8/1/2009

  	
   

  	
   

  	
  $

  	
  500,000

  	
   

  
	
  9/1/2009

  	
   

  	
   

  	
  $

  	
  1,000,000

  	
   

  
	
  10/1/2009

  	
   

  	
   

  	
  $

  	
  500,000

  	
   

  
	
  11/1/2009

  	
   

  	
   

  	
  $

  	
  1,000,000

  	
   

  
	
  12/1/2009

  	
   

  	
   

  	
  $

  	
  500,000

  	
   

  
	
  1/1/2010

  	
   

  	
   

  	
  $

  	
  500,000

  	
   

  
	
  2/1/2010

  	
   

  	
   

  	
  $

  	
  500,000

  	
   

  
	
  3/1/2010

  	
   

  	
   

  	
  —

  	
   

  
	
  4/1/2010

  	
   

  	
   

  	
  $

  	
  500,000

  	
   

  
	
  5/1/2010

  	
   

  	
   

  	
  $

  	
  500,000

  	
   

  

 

G-2

 

In the event we receive a
direction in the form of Exhibit “C” from the Beneficiary or Beneficiaries, any
such direction shall apply only to one Reduction Date and the Reduced Amount
for such Reduction Date shall not be effected until we receive a direction in
the form of Exhibit “D” from the Beneficiary or Beneficiaries directing us to
immediately reduce the Available Amount of this Letter of Credit by such
Reduced Amount. In the event of a direction by multiple joint Beneficiaries
given to us in the form of Exhibit “C” or Exhibit “D,” such direction will
require the signature of all such Beneficiaries.

 

This Letter of Credit may
be transferred one or more times in its entirety (but not in part). Such
transfers may be effected to a) a single beneficiary, or b) multiple joint
beneficiaries. Such transfer shall be effected only upon the presentation to us
of this original Letter of Credit accompanied by a transfer request,
substantially in the form of Exhibit “B” attached hereto, signed by a person or
persons purporting to be the representative or representatives of the current
Beneficiary or Beneficiaries, instructing us to transfer the Letter of Credit
to the Transferee(s) (name and address) and that the current Beneficiary or
Beneficiaries waives any right of refusal to any subsequent amendment to this
Letter of Credit. Notwithstanding anything to the contrary, any such transfer
is subject to Article 48 of Uniform Customs and Practice for Documentary
Credits, 1993 Revision, International Chamber of Commerce Publication No. 500
(the “UCP 500”).

 

In the event of a demand
by multiple joint Beneficiaries, sight draft(s) and Exhibit “A” presented must
be signed by an authorized person on behalf of each Beneficiary. In the event
of a transfer to multiple joint Beneficiaries, any subsequent amendments to
this Credit will require the signature of all such Beneficiaries.

 

This Letter of Credit
sets forth in full the terms of our undertaking, and such undertaking shall not
in any way be modified, amended or amplified by reference to any document,
instrument or agreement referred to herein (except by the UCP 500 to the extent
the UCP 500 is not in conflict with or is made inapplicable by this Letter of
Credit) or in which this Letter of Credit is referred to or to which this
Letter of Credit relates and any such reference shall not be deemed to
incorporate herein by reference any document, instrument or agreement except
the UCP 500 to the extent allowed as described above in this paragraph.

 

This Letter of Credit
expires at our offices on July 15, 2007, provided, however, that it shall be
deemed automatically extended without amendment for additional period of one
(1) year from the Initial Expiration Date and from each future expiration date
(the Initial Expiration Date and any subsequent expiration date each being an “Expiration
Date”), unless you receive, not more than one hundred and twenty (120) days and
at least ninety (90) days prior to such Expiration Date, a written notice from
us notifying you that we elect not to extend this Letter of Credit for any such
additional period. Such notice must contain the following caption in boldface,
all capital letters:  “NOTICE:
IRREVOCABLE STANDBY LETTER OF CREDIT NO.                 
WILL NOT BE EXTENDED” and must be delivered in person (including by courier
service) or by certified United States Postal Service mail or nationally-recognized
overnight delivery service, which requires a record of the recipient’s
signature as evidence of delivery (at your address above). Upon receipt of such
notice, you may draw your demand(s) on us prior to the then-relevant Expiration
Date for the then Available Amount of this Letter of Credit. Notwithstanding
anything to the contrary contained in this Letter of Credit, the Expiration
Date of this Letter of Credit shall not be extended beyond July 15, 2010.

 

We engage with you that
all demands drawn under and in compliance with the terms of this Letter of
Credit will be duly honored if presented on a Business Day during regular
business hours at our office located at 906 Grand Boulevard, Kansas City,
Missouri 64106, Attn: International Trade Services, Telephone No. (816)
860-7550, before 3:00 p.m. (Kansas City time) on or before the Initial
Expiration Date of July 15, 2007, or any subsequent Expiration Date, in person
(including by courier service) or by certified United States Postal Service mail
or nationally-recognized overnight delivery service. Demands presented at our
office at the address set forth above (or at such

 

G-3

 

other office as we may
designate by written notice to you) not later than 10:00 a.m. (Kansas City
time) shall be honored on the date of presentation, by payment, in accordance
with your payment instructions that accompany each such demand. Demands
presented at our office at the address set forth above later than 10:00 a.m. (Kansas
City time) shall be deemed to be received the following day. If requested by
you, payment under this Letter of Credit may be made by wire transfer of
immediately available funds to your account as specified in the demand or by
deposit of same day funds in your designated account (if any) that you maintain
with us. As used in this Letter of Credit, “Business Day” shall mean any day
other than a Saturday, Sunday, legal holiday or a day on which banking
institutions in Missouri are authorized or required to close.

 

All charges, costs and
fees and expenses (collectively “Fees”) relative to this Letter of Credit are
for the account of the Applicant except for transfer fees which is for the
account of the Beneficiary.

 

Communications relative
to this Letter of Credit should be addressed to the address specified above to
the attention of Kathy Carpenter, mentioning specifically our Irrevocable
Standby Letter of Credit No.                      .

 

This Letter of Credit
shall be governed by and construed in accordance with the laws of the State of
New York, including the Uniform Commercial Code in effect in said State and is
subject to the UCP 500. In the event of any conflict between the laws of the
State of New York and the UCP 500, the UCP 500 shall control.

 

 

	
   

  	
   

  
	
  (Authorized Signature)

  

 

G-4

 

EXHIBIT “A” TO LETTER OF CREDIT NO.                 

 

FORM OF LETTER OF CREDIT DEMAND

 

UMB
Bank, N.A.

906
Grand Boulevard

Kansas
City, Missouri 64106

Attn:
International Trade Services

 

Reference
is made to that certain Irrevocable Standby Letter of Credit No.                          
(the “Letter of Credit”), issued by UMB Bank, N.A. (the “Bank”) in favor of LSP
Services Plum Point, LLC (the “Beneficiary”). Any capitalized term used herein
and not defined shall have its respective meaning as set forth in the Letter of
Credit.

 

The
undersigned, a duly authorized representative of the Beneficiary or of each
Beneficiary, hereby certifies that:

 

1.     The Beneficiary or Beneficiaries are entitled
to make a drawing under the Letter of Credit;

 

2.     The amount of all previous draws under the
Letter of Credit does not exceed the stated amount of such Letter of Credit, in
the aggregate;

 

3.     The amount of this demand is USD                         ;

 

4.     Together with all previous draws under the
Letter of Credit, this demand does not exceed the stated amount of such Letter
of Credit in the aggregate.

 

5.     [EITHER]   
(a)     The Applicant has failed
to make timely payment of amount due and owing by the Applicant under the
Participation Agreement, dated as of March 3, 2006, among East Texas Electric
Cooperative, Inc., Missouri Joint Municipal Electric Utility Commission, Plum
Point Energy Associates, LLC, Applicant and any other person who has become a
party thereto.

 

[OR]

 

(b)           The Letter of Credit will expire in thirty
(30) days or less and the Applicant has neither extended or replaced it with a
satisfactory Letter of Credit or other satisfactory security as required in
satisfaction of its credit obligations to the other parties to the
Participation Agreement, dated as of March 3, 2006, among East Texas
Electric Cooperative, Inc., Missouri Joint Municipal Electric Utility
Commission, Plum Point Energy Associates, LLC, Applicant and any other Person
who has become a party thereto.

 

Therefore,
the Beneficiary or Beneficiaries hereby demand the payment of USD                   
to the following account in the United States [insert wire instructions (to
include name and account number)].

 

G-5

 

IN
WITNESS WHEREOF, the Beneficiary or Beneficiaries has/have executed this demand
on [                      ]
[    ], 20[    ].

 

THIS FORM MUST BE SIGNED BY ALL BENEFICIARIES.

 

	
  [Name
  of the Beneficiary]

  	
  [Name
  of the Beneficiary]

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
  Name:

  
	
   

  	
  Title:

  	
   

  	
  Title:

  
	
   

  	
   

  
	
  [Name
  of the Beneficiary]

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  

 

G-6

 

EXHIBIT “B” TO LETTER OF CREDIT NO.                

 

Date:                             

 

UMB
Bank, N.A.

International
Trade Services

906
Grand Boulevard

Kansas
City, Missouri 64106

 

RE:  Irrevocable Letter of Credit No.             

Issued by UMB Bank, N.A., Kansas City, Missouri

 

Dear
Sir/Madam:

 

For
value received, the undersigned Beneficiary or Beneficiaries hereby irrevocably
transfer(s) to:

 

Name
of Beneficiary(ies): 

 

Address:

 

all
rights of the undersigned Beneficiary or Beneficiaries to draw under the above
Letter of Credit in its entirety.

 

By
this transfer, all rights of the undersigned Beneficiary or Beneficiaries in
such Letter of Credit are transferred to the transferee or transferees and such
transferee or transferees shall have the sole rights as Beneficiary or
Beneficiaries thereof, including sole rights relating to any amendments,
whether increases or extensions or other amendments and whether now existing or
hereafter made. We hereby waive any rights or refusal to any subsequent
amendments to this Letter of Credit. All amendments are to be advised direct to
the transferee or transferees without necessity of any consent or notice to the
undersigned Beneficiary or Beneficiaries.

 

The
original Letter of Credit is returned herewith, and we ask you to endorse the
transfer on the reverse thereof, and forward it direct to the transferee or
transferees with your customary notice of transfer.

 

Enclosed
is our remittance of $                                      
(1/4 of 1% of the Available Amount up to a maximum commission of $3,500.00 and
a minimum of $250.00) in payment of your transfer commission.

 

THIS
FORM MUST BE SIGNED BY ALL BENEFICIARIES.

 

	
   

  	
   

  	
  SIGNATURES
  AUTHENTICATED BY:

  
	
  Letter
  of Credit Beneficiary

  	
   

  
	
   

  	
  Bank
  Name:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  (Authorized
  Signature)

  	
   

  	
   

  
	
   

  	
  (Authorized
  Signature)

  

 

G-7

 

	
   

  	
   

  
	
  Letter
  of Credit Beneficiary

  
	
   

  
	
   

  
	
   

  	
   

  
	
  (Authorized
  Signature)

  
	
   

  
	
   

  
	
   

  	
   

  
	
  Letter
  of Credit Beneficiary

  
	
   

  
	
   

  
	
   

  	
   

  
	
  (Authorized
  Signature)

  

 

G-8

 

EXHIBIT “C” TO LETTER OF CREDIT NO.             

 

Date:

 

UMB
Bank, N.A.

International
Trade Services

906
Grand Boulevard

Kansas
City, Missouri 64106

 

RE:  Irrevocable Letter of Credit No.

Issued by UMB Bank, N.A., Kansas City, Missouri

 

Dear
Sir/Madam:

 

Direction
is hereby given to you by the undersigned Beneficiary or Beneficiaries to not
reduce the above Letter of Credit on the Reduction Date of                          ,
20      by the Reduced Amount of $                       .

 

THIS FORM MUST BE SIGNED BY ALL BENEFICIARIES.

 

	
   

  	
   

  	
  SIGNATURES
  AUTHENTICATED BY:

  
	
  Letter
  of Credit Beneficiary

  	
   

  
	
   

  	
  Bank
  Name:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  (Authorized
  Signature)

  	
   

  	
   

  
	
   

  	
  (Authorized
  Signature)

  
	
   

  	
   

  	
   

  
	
  Letter
  of Credit Beneficiary

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  (Authorized
  Signature)

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Letter
  of Credit Beneficiary

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  (Authorized
  Signature)

  	
   

  

 

G-9

 

EXHIBIT “D” TO LETTER OF CREDIT NO.                      

 

Date:

 

UMB
Bank, N.A.

International
Trade Services

906
Grand Boulevard

Kansas
City, Missouri 64106

 

RE:  Irrevocable Letter of Credit No. 

Issued by UMB Bank, N.A., Kansas City, Missouri

 

Dear
Sir/Madam:

 

Direction
is hereby given to you by the undersigned Beneficiary or Beneficiaries to, upon
receipt of this direction, immediately and permanently reduce the above Letter
of Credit by the Reduction Amount of $                            
by which, but for a notice previously given to you to not reduce the above
Letter of Credit on [Reduction Date], the above Letter of Credit would have
been so reduced on such date.

 

THIS FORM MUST BE SIGNED BY ALL BENEFICIARIES.

 

	
   

  	
   

  	
  SIGNATURES
  AUTHENTICATED BY:

  
	
  Letter
  of Credit Beneficiary

  	
   

  
	
   

  	
  Bank
  Name:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  (Authorized
  Signature)

  	
   

  	
   

  
	
   

  	
  (Authorized
  Signature)

  
	
   

  	
   

  	
   

  
	
  Letter
  of Credit Beneficiary

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  (Authorized
  Signature)

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Letter
  of Credit Beneficiary

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  (Authorized
  Signature)

  	
   

  

 

G-10

 

EXHIBIT
H

THE
EMPIRE DISTRICT ELECTRIC COMPANY

 

APPLICATION

 

	
  UMB Bank, N.A.

  	
   

  	
   

  	
   

  	
  DATE:   March 14, 2006

  
	
  International Trade
  Services

  	
   

  	
   

  	
   

  	
   

  
	
  P.O. Box 419226

  	
   

  	
   

  	
   

  	
   

  
	
  Kansas City, Missouri
  64141-6226

  	
   

  	
   

  	
  NUMBER:

  	
   

  

 

PLEASE
ISSUE AN IRREVOCABLE STANDBY LETTER OF CREDIT AS FOLLOWS:

 

IN
FAVOR OF:

 

ADDRESS:

 

FOR
ACCOUNT OF:

 

ADDRESS:

 

UP TO
THE AGGREGATE AMOUNT OF:

 

AVAILABLE
BY DRAFTS AT SIGHT DRAWN AT YOUR OPTION, ON YOU OR YOUR CORRESPONDENT WHEN
ACCOMPANIED BY THE FOLLOWING DOCUMENTS:

 

 

PLEASE
ISSUE A LETTER OF CREDIT IN ACCORDANCE WITH THE TERMS OF THE ATTACHED EXHIBIT “A”
WHICH FORMS AN INTEGRAL PART OF THE LETTER OF CREDIT APPLICATION AND AGREEMENT.

 

 

DRAFTS/BILLS
OF EXCHANGE TO BE PRESENTED AT 1010 GRAND AVENUE, INTERNATIONAL DEPARTMENT,
KANSAS CITY, MISSOURI 64106 NOT LATER THAN JULY 15, 2007 OR ANY
AUTOMATICALLY EXTENDED EXPIRY DATE

 

(THIS APPLICATION
IS TO BE SIGNED ON PAGE 4)

 

H-1

 

In
consideration of UMB Bank, n.a. (hereinafter “you” or “Bank”) issuing an
irrevocable Letter of Credit (referred to herein as the “Credit”),
substantially in accordance with the terms of this Application, the undersigned
(referred to herein as the “Applicant”) hereby agrees, subject to the terms of
the First Amended and Restated Unsecured Credit Agreement, dated as of March
14, 2006, among the Applicant, the Bank, as administrative agent and issuing
lender, Bank of America, N.A., as syndication agent, and the lenders named
therein (the “Credit Agreement”) as follows:

 

1.             It
is fully understood and agreed that you are hereby expressly authorized and
directed to honor any request for payment which is made under and in compliance
with the terms and conditions of the Credit and this Application without regard
to, and without any duty on your part to inquire into, the existence of any
disputes or controversies between Applicant, the beneficiary or beneficiaries
of the Credit or any other person, firm, corporation or legal entity, or the
respective rights, duties or liabilities of any of them, or whether any facts
or occurrences represented in any of the drafts or documents presented under
the Credit are true or correct; that your sole obligation to Applicant shall be
so limited despite your assistance in the preparation of the Credit or any
documents required to be presented thereunder, or your awareness of any facts
or occurrences of the underlying transaction giving rise to the Credit and this
Application; and that no liability shall attach to you, nor your
correspondents, for any loss or damage in consequence of any delay or error
beyond your reasonable control.

 

2.             As
to drafts or acceptances under or purporting to be under the Credit, which are
payable in United States Currency, Applicant agrees:   (a) in the case of each sight draft, to
reimburse (either directly or through a deemed borrowing under the Credit
Agreement) you in United States Currency at your office, on demand, the amount
paid on such drafts, together with interest on such amount at the rate set
forth in the Credit Agreement until such payment is made, or, if so demanded by
you, to pay to you at your office in advance the amount required to pay such
draft; and (b) in the case of each acceptance, to pay (either directly or
through a deemed borrowing under the Credit Agreement)  to you in United States Currency at your
office, the amount thereof, on demand but in any event not later than one
banking day prior to maturity, or, in case the acceptance is not payable at
your office, then on demand but in any event in time to reach the place of
payment in the course of the mails not later than one banking day prior to
maturity.

 

3.             Except
insofar as instructions have been heretofore given to you by Applicant in
writing expressly to the contrary, Applicant agrees that you and any of your
correspondents may accept or pay as complying with the terms of the Credit any
drafts or other documents otherwise in order which may be signed or issued by
the administrator, executor, trustee in bankruptcy, debtor in possession,
assignee for benefit of creditors, liquidator, receiver or other legal
representative of the party who is authorized under the Credit to draw or issue
any drafts or other documents.

 

4.             Except
insofar as instructions have been heretofore given to you by Applicant in
writing expressly to the contrary, Applicant agrees that part performance may
be made under the Credit and that you may honor the relative drafts, subject as
to amount in all events to the amount of the Credit, and that it the Credit
specifies performance in installments within stated periods, and there is
absence or failure of performance in any designated period, subsequent
performance may nevertheless be made in subsequent designated periods and you may
honor the relative drafts.

 

5.             If
at Applicant’s request the Credit is issued in transferable form, it is hereby
understood and agreed that you are under no duty to determine the proper
identity of any person, firm, corporation or legal entity appearing in the
draft or documents presented under the Credit as transferee or transferees,
that you shall not be charged with the duty or responsibility of any nature or
character for the validity or correctness of any transfer or successive
transfers, that payment by you to any purported transferee(s) as determined by
you is hereby authorized and approved, that not making scheduled reductions in
the amount available for drawing under the Credit as may be directed from time
to time by any beneficiary or beneficiaries is hereby authorized and approved,
and that you will be held harmless and indemnified by the Applicant against any
liability or claim in connection with or arising out of the foregoing.

 

6.             If
at Applicant’s special request it is a condition of the Credit that payment be
made upon receipt by you of a cable advising negotiation, it is hereby
understood and agreed that Applicant will reimburse you on demand for the
amount indicated in the said cable advice, and that you will be held harmless
and no liability shall attach if 

 

H-2

 

documents
fail to arrive, or when, as and if documents arrive it should develop that the
terms of the Credit have not been complied with, and that documents are not in
order.

 

7.             Applicant
agrees that in the event of any extension of the maturity or time for
presentation of drafts, acceptances or documents, or any other modification of
the terms of the Credit, at the request of any of the parties thereto with or
without notification to the others, or in the event of any increase in the
amount of the Credit, this Agreement shall be binding upon the parties thereto
with regard to the Credit so increased or otherwise modified, to drafts,
documents and property covered thereby, and to any action taken by you or any
of your correspondents in accordance with such extension, increase or other
modification. In the event that you or your correspondent at the request of
Applicant extend(s) renew(s), or refinance(s) any of the obligations of Applicant
to you, arising under paragraphs 2 and 3 hereof, by means of (a) Bankers
Acceptances created by the acceptance of drafts drawn by Applicant on you or
your correspondent, (b) drafts, drawn by the beneficiary of the Credit accepted
by you or your correspondent, (c) notes made by Applicant, or (d) in the event
that you further extend, renew or refinance, from time to time, any such
Bankers Acceptance, draft or note, then, and in consideration thereof,
Applicant agrees to pay to you the amount of each Bankers Acceptance or draft
in the manner provided in paragraphs 2 and 3 hereof for the payment of time
drafts drawn under the Credit, or, if a note is involved, then in the manner
provided in the note. Applicant further agrees that with respect to any such extension,
renewal or refinancing, all of the terms, conditions, agreements and
obligations contained in this Agreement shall apply thereto and that you shall
have all the rights and remedies set forth in this Agreement as well as those
set forth in any other document signed by or on behalf of Applicant.

 

8.             The users, including
the initial beneficiary and all transferees, of the Credit shall be deemed
Applicant’s agents and Applicant assumes all risks of their acts and omissions.
Neither you nor your correspondents shall be responsible: for the use which may
be made of the Credit or for any acts or omissions of the beneficiaries in
connection therewith, such acts or omissions including (without limitation)
deviation from required performance, delays, defaults and/or fraud of whatever
nature; for the validity, sufficiency, or genuineness of documents or of any
signatures or endorsements thereon, even if such documents should in fact prove
to be in any or all respects invalid, insufficient, fraudulent or forged; for
the character, adequacy, validity, or genuineness of any insurance; for the
solvency or responsibility of any insurer or for any other risk connected with
insurance; for any breach of contract or any other acts, omissions or
representations by the beneficiary of the Credit or by Applicant; or failure of
documents to accompany any draft at negotiations, or failure of any person to
note the amount of any draft on the reverse of the Credit or to surrender or
take up the Credit or to send forward documents apart from drafts as required
by the terms of the Credit, each of which provisions, if contained in the
Credit itself, it is agreed may be waived by you; or for errors, omissions,
interruptions, or delays in transmission or delivery of any messages, by mail,
cable, telegraph, wireless or otherwise, whether or not they be in cipher; nor
shall you be responsible for any errors, neglect or default of any of your
correspondents, unless in breach of good faith; and that the occurrence of any
of the contingencies mentioned above shall not affect, impair, or prevent the
vesting of any of your rights or powers hereunder. In furtherance and extension
and not in limitation of the specific provisions hereinbefore set forth, it is
agreed that any action taken by you or by any correspondent of yours under or
in connection with the Credit or the relative drafts, documents or property, if
taken in good faith, shall be binding on Applicant and shall not put you or
your correspondent under any resulting liability to Applicant, and Applicant
makes like agreement as to any inaction or omission, unless in breach of good
faith.

 

9.             You
shall not be deemed to have waived any of your rights hereunder, unless you or
your authorized agent shall have signed such waiver in writing. No such waiver,
unless expressly as stated therein, shall be effective as to any transaction
which occurs subsequent to the date of such waiver, nor as to any continuance
of a breach after such waiver.

 

10.           The
word “property” as used in this agreement includes goods, merchandise,
securities, funds, choses in action, accounts, contract rights, general
intangibles, instruments, documents of title and any and all other forms of
property, whether real, personal or mixed and any right or interest therein.

 

11.           Except
as otherwise expressly agreed in writing, prior to the issuance of the Credit,
the Uniform Customs and Practice for Documentary Credits, International Chamber
of Commerce Publication No. 500 or such successor

 

H-3

 

publication
of the International Chamber of Commerce, if any, as is hereinafter designated,
shall in all respects be deemed a part hereof as fully as if incorporated
herein and shall in all respects apply to the Credit. Successor Publication (if
any):                            .

 

12.           If
this Agreement and Application is signed by two or more parties, it shall be
the joint and several agreement of such parties. If this Agreement and
Application is signed by one or more individuals for and on behalf of a
corporation, partnership, association, cooperative or other entity, each of
said individuals hereby warrants and represents that he is duly authorized and
directed by such entity to execute this Agreement and Application for and on
behalf of such entity and does hereby fully obligate the entity to each of the
terms, covenants and conditions hereof.

 

13.           This
Agreement shall be binding upon the Applicant, its legal representatives,
heirs, successors and assigns, and shall inure to the benefit of your
successors and assigns. Without limitation of paragraph 5 or any other
provision hereof, it is further agreed and understood that each reference
herein to the beneficiary or beneficiaries of the Credit also refers to the
successors and assigns of such beneficiary or beneficiaries.

 

	
  THE EMPIRE DISTRICT
  ELECTRIC COMPANY

  
	
   

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  (Authorized
  Signature)

  	
   

  

 

H-4

 

EXHIBIT
“A”

TO

THE EMPIRE DISTRICT ELECTRIC COMPANY

APPLICATION

 

	
  ISSUING BANK:

  	
   

  	
  IRREVOCABLE STANDBY CREDIT NUMBER:

  
	
  UMB Bank, N.A.

  	
   

  	
   

  
	
  International Trade Services

  	
   

  	
   

  
	
  906 Grand Boulevard

  	
   

  	
   

  
	
  Kansas City, Missouri 64106 U.S.A.

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  PLACE AND DATE OF ISSUE:

  	
   

  	
  EXPIRY DATE AND PLACE FOR PRESENTATION

  OF DOCUMENT:

  
	
  Kansas City, Missouri 64106 U.S.A.

  	
   

  	
   

  
	
   

  	
   

  	
  Kansas City, Missouri 64101

  
	
   

  	
   

  	
   

  
	
  APPLICANT:

  	
   

  	
  BENEFICIARY:

  
	
   

  	
   

  	
   

  
	
  (Company Name)

  	
   

  	
  (Beneficiary’s Name)

  
	
  (Address)

  	
   

  	
  (Address)

  
	
  (City and State)

  	
   

  	
  (City and State)

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Amount:

  
	
   

  	
   

  	
  (Amount in Words)

  

 

H-5

 

EXHIBIT
I

THE
EMPIRE DISTRICT ELECTRIC COMPANY

 

NOTICE
OF PAYMENT REQUEST

 

[Date]

 

[Name
of Lender]

[Address]

 

Attention:

 

Reference
is made to the First Amended and Restated Unsecured Credit Agreement, dated as
of March 14, 2006, among The Empire District Electric Company, the Banks party
thereto, and UMB Bank, N.A., as Administrative Agent (the “Credit Agreement”). Capitalized
terms used herein and not defined herein have the meanings assigned to them in
the Credit Agreement. [The Company has failed to pay its Reimbursement
Obligation in the amount of $                         .
Your Letter of Credit Commitment Percentage of the unpaid Reimbursement
Obligation is $                         ]
or [                         
has been required to return a payment by the Company of a Reimbursement
Obligation in the amount of $                         .
Your Letter of Credit Commitment Percentage of the returned Reimbursement
Obligation is $                         .]

 

	
   

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
  UMB BANK, N.A.

  
	
   

  	
  as L/C Issuer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
						

 

I-1

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