Document:

Purchase Agreement

  
 Exhibit 10.25 
  
 EXECUTION COPY 
  
 PURCHASE AGREEMENT 
  
 BETWEEN 
  
 CCE HOLDINGS, LLC 
  
 AND 
  
 ONEOK, INC. 
  
 Dated as of September 16, 2004 
  

  
 PURCHASE AGREEMENT

  
 PURCHASE AGREEMENT, dated as of September 16, 2004 (this
“Agreement”), between CCE Holdings, LLC, a Delaware limited liability company (“Seller”), and ONEOK, Inc., an Oklahoma corporation (“Purchaser”). 
  
 WITNESSETH: 
  
 WHEREAS, Enron Operations Services, LLC, a Delaware limited liability company, Enron Transportation Services, LLC, a
Delaware limited liability company, EOC Preferred, L.L.C., a Delaware limited liability company, and Enron Corp., an Oregon corporation (collectively, the “Enron Sellers”) and Seller entered into a Purchase Agreement, dated as of
June 24, 2004, as amended by that certain Amendment No. 1 to Purchase Agreement dated September 1, 2004 (the “Enron Purchase Agreement”), whereby Seller agreed to purchase 100% of the membership interests of CrossCountry Energy, LLC
(“CrossCountry”); and 
  
 WHEREAS, CrossCountry
owns, among other things, (i) four hundred (400) shares of common stock, par value $10.00 per share, of Northern Plains Natural Gas Company, a Delaware corporation (“Northern Plains”), which constitutes 100% of the issued and
outstanding shares of capital stock of Northern Plains and (ii) one thousand (1,000) shares of common stock, par value $1.00 per share, of NBP Services Corporation, a Delaware corporation (“NBP Services”), which constitutes 100% of
the issued and outstanding shares of capital stock of NBP Services (the common stock referred to in the preceding clauses (i) and (ii) or the ownership interests in limited liability companies or limited partnerships into which such common stock may
be converted pursuant to the Conversion Transactions (as defined in the Enron Purchase Agreement) will be referred to in this Agreement as, collectively, the “Equity Interest”); and 
  
 WHEREAS, CrossCountry is, and upon the closing of the transactions
contemplated by the Enron Purchase Agreement will be, the holder of the Equity Interest; and 
  
 WHEREAS, pursuant to the terms of this Agreement, Seller desires to sell to Purchaser, and Purchaser desires to purchase from Seller, the Equity Interest; and 
  
 WHEREAS, concurrently with the closing of the transactions contemplated by
the Enron Purchase Agreement, Seller will cause CrossCountry to transfer the Equity Interest to Purchaser pursuant to the terms of this Agreement; and 
  
 WHEREAS, certain terms used in this Agreement are defined in Section 11.1. 
  

 NOW, THEREFORE, in consideration of the premises and the representations, warranties, covenants and
agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound hereby, the parties agree as follows: 
  
 ARTICLE I 
  
 SALE AND PURCHASE OF EQUITY INTEREST 
  

1.1 Sale and Purchase of Equity Interest. Upon the terms and subject to the conditions contained herein, on the Closing Date, Seller shall sell,
assign, transfer, convey and deliver to Purchaser, and Purchaser shall purchase from Seller, the Equity Interest, free and clear of all Liens. 
  
 ARTICLE II 
  
 PURCHASE PRICE AND PAYMENT 
  
 2.1 Purchase Price. The purchase price for the Equity Interest shall be an amount equal to (i) $175,000,000 (the “Preliminary Purchase Price”), plus (ii) an amount, which may be positive or
negative, calculated pursuant to Schedule 2.1 (the Preliminary Purchase Price, after giving effect to all adjustments contemplated pursuant to Schedule 2.1, is referred to herein as the “Purchase Price”). 

 
 2.2 Deposit. 
  
 (a) On or prior to September 20, 2004, Purchaser shall deposit with JPMorgan
Chase Bank, in its capacity as Deposit Escrow Agent (the “Deposit Escrow Agent”), pursuant to that certain Deposit Escrow Agreement, dated as of the date hereof, among Purchaser, Seller and the Deposit Escrow Agent (the
“Deposit Escrow Agreement”), (i) one or more original irrevocable letters of credit (the “Letters of Credit”), each in the form of Appendix A to the Deposit Escrow Agreement, for an aggregate amount equal to
$3,600,000 (the “Deposit Amount”) or (ii) cash in the amount of the Deposit Amount (the “Cash Deposit”). The Letters of Credit will be drawn upon by the Deposit Escrow Agent, or the Cash Deposit will be disbursed by
the Deposit Escrow Agent, as applicable, only in the circumstances described in, and to the extent permitted by, Section 2.2(c) and the Deposit Escrow Agreement. The Letters of Credit and any funds drawn thereunder, or the Cash Deposit, as
applicable, shall be held by the Deposit Escrow Agent and applied, or returned to Purchaser, in accordance with the provisions of this Section 2.2 and the Deposit Escrow Agreement. Upon Closing and as provided in Section 2.2(b), the Letters of
Credit and any funds drawn thereunder, or the Cash Deposit, as applicable, shall be released to Purchaser.  
  

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 (b) Pursuant to the Deposit Escrow Agreement, the Letters of Credit shall be released and returned to
Purchaser, or the Cash Deposit shall be released and returned to Purchaser, as applicable, in the event that this Agreement is validly terminated by (i) Purchaser (A) pursuant to Sections 3.2(a), 3.2(c) or 3.2(d) or (B) pursuant to Section 3.2(b) in
the event that the Closing does not occur on or prior to the Outside Date due to the failure to satisfy the closing conditions set forth in Sections 7.1(a), 7.1(b), 7.1(c), 7.1(d) or 7.2(a) – (d), or (ii) by Seller (A) pursuant to Sections
3.2(a) or 3.2(c), or (B) pursuant to Section 3.2(e) in the event that such termination by Seller is solely based upon a breach of Purchaser’s representations in Section 5.4 due to an Action or Order of which Purchaser is not aware as of the
date of this Agreement that seeks to restrain or prohibit or otherwise challenge the consummation, legality and validity of the transactions contemplated hereby or that directly results from and relates to the execution of this Agreement and in any
such case is filed or threatened to be filed after the date hereof by a Person other than Purchaser or any of its Affiliates or Representatives or any other Person acting, directly or indirectly, on behalf of or at the behest of or with the
encouragement of any of them; provided, that the Letters of Credit or the Cash Deposit, as applicable, shall not be released or returned to Purchaser in the event that any termination referred to in this paragraph (b) relates to or arises from a
failure to satisfy the closing condition set forth in (i) Section 7.1(b) (with respect to the HSR Act); or 
  
 (c) Except as specified in Section 2.2(b), upon the valid termination of this Agreement, the Letters of Credit shall be drawn upon for the Deposit Amount,
if applicable, and the Deposit Amount or the Cash Deposit, as applicable, shall be paid to Seller as liquidated damages. For the avoidance of doubt and, except as provided in Section 2.2(b), if all of the conditions set forth in Sections 7.1 and 7.2
have been satisfied (assuming for such purposes that the Closing would have occurred on the date of termination of this Agreement), and Purchaser fails to pay the Purchase Price in accordance with the terms of this Agreement, Seller shall be
entitled to the Deposit Amount. Upon the payment to Seller of the Deposit Amount pursuant to this Section 2.2(c), the parties hereto and their Affiliates and Representatives shall, subject to Section 3.3, be fully released and discharged from all
liabilities and obligations under or resulting from this Agreement, and no party shall have any other remedy or cause of action against any other party under or relating to this Agreement. 
  
 2.3 Payment of Purchase Price. At the Closing, Purchaser shall pay (i)
the Preliminary Purchase Price plus (ii) the Estimated Purchase Price Adjustment to Seller by wire transfer of immediately available funds into an account or accounts designated in writing by Seller. The parties agree to pay, if applicable, the
True-up Amount in accordance with Schedule 2.1. 
  

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 ARTICLE III 
  
 CLOSING AND TERMINATION 
  
 3.1 Time and Place of Closing. The closing of the sale and purchase provided for in Article I (the “Closing”) shall take place at
the New York City offices of Weil, Gotshal & Manges LLP contemporaneously with the closing under the Enron Purchase Agreement (the “Enron Closing”), or at such other place, date and time as the parties may agree (the actual date
on which the Closing is to occur pursuant to this Section 3.1 shall be referred to as the “Closing Date”); provided, however, that neither Seller nor Purchaser shall be required to close the transactions contemplated
by this Agreement until all conditions to the obligations of Seller or Purchaser, as the case may be, shall have been satisfied or waived in accordance with the provisions of Article VII. Seller shall advise Purchaser as soon as reasonably
practicable as to the date of the Closing. 
  
 3.2 Termination
of Agreement. This Agreement may be terminated prior to the Closing as follows: 
  
 (a) At any time prior to the Closing Date by the mutual written consent duly authorized by the Board of Directors or Board of Managers, as applicable, of Seller and Purchaser; 
  
 (b) By either Seller or Purchaser, if the Closing has not occurred on or
before the later of (i) December 17, 2004 or (ii) such date as is the Outside Date under the Enron Purchase Agreement (as may be extended from time to time pursuant to the terms of the Enron Purchase Agreement) (the “Outside Date”);
provided, however, that the terminating party is not in default of its obligations under this Agreement in any material respect; 
  
 (c) By either Seller or Purchaser, if there shall be any Applicable Law that makes consummation of the transactions contemplated hereby illegal or
otherwise prohibited (and such Law is not overturned or otherwise made inapplicable to the transactions contemplated hereby within a period of one hundred and twenty (120) days) or if any Order is entered by a Governmental Authority of competent
jurisdiction having valid enforcement authority permanently restraining, prohibiting or enjoining Seller or Purchaser from consummating the transactions contemplated hereby and such Order shall become final and non-appealable; 
  
 (d) By Purchaser, so long as Purchaser is not then in breach of its
obligations under this Agreement in any material respect, upon a breach of any covenant or agreement of Seller set forth in this Agreement, or if any representation or warranty of Seller shall have been or becomes untrue, in each case such that the
conditions set forth in Section 7.2(a) or Section 7.2(b), as the case may be, would not be satisfied and such breach or untruth (i) cannot be cured by the Outside Date or (ii) has not been cured within 

  

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thirty (30) Business Days of the date on which Seller receives written notice thereof from Purchaser (describing with reasonable specificity the purported
breach or untruth); provided, however, that Purchaser shall not be entitled to terminate this Agreement pursuant to the foregoing clause (ii) so long as Seller is using its commercially reasonable efforts to cure such breach or untruth
and such breach or untruth is capable of cure on or before the Outside Date; 
  
 (e) By Seller, so long as Seller is not then in breach of its obligations under this Agreement in any material respect, upon a breach of any covenant or agreement of Purchaser set forth in this Agreement, or if any
representation or warranty of Purchaser shall have been or becomes untrue, in each case such that the conditions set forth in Section 7.3(a) or Section 7.3(b), as the case may be, would not be satisfied and such breach or untruth (i) cannot be cured
by the Outside Date or (ii) has not been cured within thirty (30) Business Days of the date on which Purchaser receives written notice thereof from Seller (describing with reasonable specificity the purported breach or untruth); provided,
however, that Seller shall not be entitled to terminate this Agreement pursuant to the foregoing clause (ii) so long as Purchaser is using its commercially reasonable efforts to cure such breach or untruth and such breach or untruth is capable
of cure on or before the Outside Date; 
  
 (f) By Seller,
upon notice to Purchaser, if (i) Purchaser has provided notice to Seller pursuant to Section 6.9 or (ii) Seller requests Purchaser to deliver to Seller an officer’s certificate stating that the representation set forth in Section 5.6 is
true and complete and Purchaser does not within ten (10) days of the receipt of such request deliver such certificate to Seller; provided, however, that the right to terminate this Agreement under this Section 3.2(f) shall not be
available to Seller if within thirty (30) days of receiving notice by Seller of its intention to terminate this Agreement under this Section 3.2(f), Purchaser secures a financing commitment for alternate or additional financing under terms and from
a financing source that is reasonably acceptable to Seller. Notwithstanding the foregoing, Seller shall not have the right to terminate this Agreement pursuant to this Section 3.2(f) if Purchaser’s inability to deliver the certificate
referenced in this Section 3.2(f) was caused by a material breach by Seller of its obligations under this Agreement or any representation or warranty of Seller having been or having become untrue in any material respect; 
  
 (g) By Seller, if Purchaser fails to close the transactions contemplated
hereunder on the Closing Date as determined in accordance with Section 3.1; or 
  
 (h) By Seller, if Purchaser fails to deposit with the Deposit Escrow Agent the Letters of Credit or the Cash Deposit on or prior to September 20, 2004. 
  
 3.3 Effect of Termination. No termination of this Agreement pursuant to Section 3.2 shall be effective until notice
thereof shall be given to the non-terminating party specifying the provision hereof pursuant to which such termination is made. If validly terminated pursuant to Section 3.2, this Agreement shall become wholly void and 

  

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of no further force and effect without liability to Purchaser, Seller or any of the Transfer Group Companies or the Northern Border Companies or any of their
respective Subsidiaries, Affiliates, officers, directors, employees, agents, advisors or other representatives, except that the obligations of the parties under the Deposit Escrow Agreement, this Section 3.3, Sections 2.2, 6.5, 6.6, Article XII and,
to the extent necessary to effectuate the foregoing enumerated provisions, Article XI of this Agreement shall remain in full force and effect (it being understood that in no event shall Seller be obligated to make any payment to Purchaser upon
termination of this Agreement, and in no event shall Purchaser be obligated to make any payments to Seller upon termination of this Agreement other than the forfeiture of the Deposit Amount to Seller in accordance with Section 2.2(c)). 

 
 ARTICLE IV 
  
 REPRESENTATIONS AND WARRANTIES OF SELLER 
  
 Seller hereby represents and warrants to Purchaser as follows:  
  
 4.1 Organization and Good Standing. Seller is a limited liability
company duly organized, validly existing and in good standing under the laws of the State of Delaware and Seller has the requisite power and authority to own, lease and operate its properties and to carry on its business as now conducted.

  
 4.2 Authorization of Agreement. Seller has the
requisite power and authority to execute this Agreement and the Transaction Documents to which it is a party and, upon the occurrence of the Enron Closing, to consummate the transactions contemplated by this Agreement and the Transaction Documents
to which it is a party. The execution and delivery of this Agreement and the Transaction Documents to which it is a party by Seller and the consummation by Seller of the transactions contemplated by this Agreement and the Transaction Documents to
which it is a party have been duly authorized by all necessary action on the part of Seller. This Agreement and the Transaction Documents to which it is a party have been duly executed and delivered by Seller and, assuming due execution and delivery
by Purchaser, constitute valid and binding obligations of Seller, enforceable against Seller in accordance with their respective terms. 
  
 4.3 No Violation; Consents. 
  
 (a) Subject to receiving the consents or waivers referred to on Schedule 4.3(a) and the consents referred to in Section 4.3(b) and the occurrence
of the Enron Closing, the execution and delivery by Seller of this Agreement and the Transaction Documents to which Seller is a party and the consummation of the transactions contemplated hereby and thereby do not and will not (i) violate any

  

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provision of the certificate of incorporation, bylaws, limited liability company agreement or other similar organizational documents of Seller or any
Transfer Group Company, (ii) conflict with, require the consent of a third party under, violate, require or accelerate the time of any payment by any Transfer Group Company to any Person under, result in the breach of, constitute a default under, or
give rise to any right of acceleration, cancellation or termination of any material right or obligation of Seller or any Transfer Group Company under, any material agreement or other instrument to which Seller or any Transfer Group Company is a
party or by which Seller or any Transfer Group Company or any of their respective properties or assets are bound, (iii) violate any Order of any Governmental Authority to which Seller or any Transfer Group Company is bound or subject, (iv) violate
any Applicable Law or (v) except as provided in this Agreement, result in the imposition or creation of any Lien upon the Equity Interest, other than, in the case of clauses (ii) through (v), any conflict, violation, breach, default, requirement for
consents, rights of acceleration, cancellation, termination or Lien that would not reasonably be expected to have, individually or in the aggregate, a Seller Material Adverse Effect or a Transfer Group Material Adverse Effect. 
  
 (b) Except as set forth on Schedule 4.3(b) and except for (i) any
filings required under the HSR Act and (ii) such filings with, and Orders of, the FCC as may be required under the Communications Act, no Order or Permit issued by, or declaration or filing with, or notification to, or waiver from or consent from,
any Governmental Authority is required on the part of Seller in connection with the execution and delivery of this Agreement, or the compliance or performance by Seller with any provision contained in this Agreement or the consummation of the
transactions contemplated hereby, except for any such requirements, the failure of which to be obtained or made would not reasonably be expected to have, individually or in the aggregate, a Seller Material Adverse Effect or a Transfer Group Material
Adverse Effect. 
  
 4.4 Ownership and Transfer of Equity
Interest. Upon the Occurrence of the Enron Closing, Seller will be the record and beneficial owner of all of the outstanding equity securities of CrossCountry. CrossCountry is the record and beneficial owner of the Equity Interest. The Equity
Interest constitutes 100% of the outstanding equity securities of Northern Plains and NBP Services. Upon the occurrence of the Enron Closing, Seller will have the requisite power and authority to cause CrossCountry to sell and transfer the Equity
Interest to Purchaser, and such delivery will convey to Purchaser good and marketable title to the Equity Interest, free and clear of any and all Liens except as set forth on Schedule 4.4. 
  
 4.5 Transfer Group Companies. 
  
 (a) Schedule 4.5(a) sets forth the name of each Transfer Group Company
and, with respect to each such Transfer Group Company, the jurisdiction in which it is incorporated or organized, the number of shares of its authorized capital stock or other equity interests, the number and class of shares or equity interests
thereof duly issued and outstanding, the names of all stockholders or other equity owners and the 

  

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number of shares of stock or other equity interests owned by each equity owner thereof. The outstanding shares of capital stock or other equity interests of
each Transfer Group Company are validly issued, fully paid and non-assessable, and all such shares or other equity interests represented as being owned by the relevant Transfer Group Company are owned by it free and clear of any and all Liens except
as set forth on Schedule 4.5(a). 
  
 (b) Except as set
forth on Schedule 4.5(b), (i) there is no existing option, warrant, right, call, commitment or other agreement to which any Transfer Group Company is a party requiring, and there are no securities of any Transfer Group Company outstanding
which, upon conversion, would require, the issuance, sale or transfer of any additional shares of capital stock or other equity interests of any Transfer Group Company or other securities convertible into, exchangeable for or evidencing the right to
subscribe for or purchase shares of capital stock or other equity interests of any Transfer Group Company and (ii) no Transfer Group Company has any obligation to repurchase, acquire or redeem any capital stock or other equity securities of any
Transfer Group Company. 
  
 (c) Each Transfer Group Company is an
entity duly organized, validly existing and in good standing under the laws of the jurisdiction in which it is formed and has the requisite power and authority to own, lease and operate its properties and to carry on its business as now conducted,
with such exceptions that would not reasonably be expected to have, individually or in the aggregate, a Transfer Group Material Adverse Effect. Each Transfer Group Company is duly qualified to transact business and is in good standing in each
jurisdiction in which the nature of its business or the ownership or leasing of its properties makes such qualification necessary, except where the failure to be so qualified would not reasonably be expected to have, individually or in the
aggregate, a Transfer Group Material Adverse Effect. 
  
 (d)
Northern Plains holds a 0.500% general partnership interest in Northern Border Partners, L.P., a publicly-traded master limited partnership (“Northern Border”) and a 0.505% general partnership interest in Northern Border’s
Affiliate, Northern Border Intermediate Limited Partnership (“NBI”). Northern Plain’s wholly-owned subsidiary, Pan Border Gas Company, holds a 0.325% general partnership interest in Northern Border and a 0.3283% general
partnership interest in NBI. Northern Plains holds 500,000 common units of limited partnership interest in Northern Border. 
  
 (e) None of the Transfer Group Companies has any Subsidiary, or holds an equity interest in any other Person, that is not a Transfer Group Company other
than the Northern Border Companies and Persons in which the Northern Border Companies hold a minority equity interest. 
  

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 4.6 Financial Statements; Northern Border SEC Reports. 
  
 (a) Seller has made available to Purchaser copies of the unaudited
consolidated balance sheet of the Northern Plains Group Companies as at December 31, 2003, and the related consolidated unaudited statements of income, stockholders’ equity and cash flows of the Northern Plains Group Companies for the twelve
(12) month period then ended (collectively, the “Financial Statements”). The Financial Statements have been prepared in accordance with the books and records of the Northern Plains Group Companies as at the date and for the period
indicated, and, except as set forth in Schedule 4.6, in accordance with GAAP and present fairly in all material respects the consolidated financial position, results of operations and cash flows of each of the Northern Plains Group Companies
as at the date and for the period indicated (in each case subject, as to unaudited Financial Statements, to year-end audit adjustments and full footnote disclosure). For the purposes hereof, the unaudited consolidated balance sheet of the Northern
Plains Group Companies as at December 31, 2003 shall be referred to as the “Balance Sheets” and December 31, 2003 shall be referred to as the “Balance Sheet Date”. 
  
 (b) Northern Border has filed all required forms, reports and documents with
the Securities and Exchange Commission (the “SEC”) since January 1, 2002 (the “Northern Border SEC Reports”), each of which has complied in all material respects with all applicable requirements of the Securities
Act of 1933, as amended (the “Securities Act”), and the Securities Exchange Act of 1934, as amended (the “Exchange Act”), each as in effect on the dates such forms, reports and documents were filed. To the Knowledge
of Seller, none of the Northern Border SEC Reports, including without limitation, any financial statements or schedules included or incorporated by reference therein, contained, when filed, any untrue statements of a material fact or omitted to
state a material fact required to be stated or incorporated by reference therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. The consolidated financial
statements of Northern Border included in the Northern Border SEC Reports complied as to form in all material respects with applicable accounting requirements and the published rules and regulations of the SEC with respect thereto as in effect on
the dates such Northern Border SEC Reports were filed, and fairly present, in all material respects and in conformity with GAAP applied on a consistent basis (except as may be indicated in the notes thereto), the consolidated financial position of
Northern Border and its consolidated subsidiaries as of the dates thereof and their consolidated results of operations and changes in financial position for the periods then ended (subject, in the case of the unaudited interim financial statements,
to normal year-end adjustments). 
  
 4.7 No Undisclosed
Liabilities. 
  
 (a) Except as set forth on Schedule
4.7(a), or as would not reasonably be expected to have, individually or in the aggregate, a Seller Material Adverse Effect or 

  

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a Transfer Group Material Adverse Effect, the Northern Plains Group Companies have no indebtedness, obligation or liability of any kind (whether accrued,
absolute, contingent or otherwise, and whether due or to become due) that would have been required to be reflected in, reserved against or otherwise described on the consolidated balance sheet of the Northern Plains Group Companies or in the notes
thereto in accordance with GAAP, respectively, which (i) is not shown on the Balance Sheets or the notes thereto or (ii) was not incurred in the Ordinary Course of Business since the Balance Sheet Date, except for any indebtedness, obligation or
liability arising after the date of the Enron Purchase Agreement which is permitted pursuant to Section 6.2. 
  
 (b) Except as disclosed or reflected in the Northern Border SEC Reports, or as would not reasonably be expected to have, individually or in the aggregate,
a Seller Material Adverse Effect or a Transfer Group Material Adverse Effect, the Northern Border Companies have no indebtedness, obligation or liability of any kind (whether accrued, absolute, contingent or otherwise, and whether due or to become
due) that would have been required, based on information known to Seller or any of the Northern Border Companies as of the date of the Enron Purchase Agreement, to be reflected in, reserved against or otherwise described on the consolidated balance
sheet of Northern Border and its subsidiaries included in the most recent Northern Border SEC Reports or in the notes thereto in accordance with GAAP, which (i) is not shown on a balance sheet of the Northern Border Companies or the notes thereto or
(ii) was not incurred in the ordinary course of business since the Balance Sheet Date. 
  
 (c) NBP Services does not have any indebtedness, obligations or liabilities of any kind (whether accrued, absolute, contingent or otherwise) except for (i) liabilities incurred at any time in the Ordinary Course of
Business, (ii) liabilities that do not exceed $1,000,000 in the aggregate or (iii) as set forth in Schedule 4.7(c). 
  
 4.8 Absence of Certain Developments. 
  
 (a) Except as expressly contemplated by this Agreement or the Contribution Agreement and the schedules thereto (including the agreements entered into, and
actions taken, in connection with the Contribution Agreement) or as set forth on Schedule 4.8(a), since the Balance Sheet Date, (i) the business of the Transfer Group Companies has been conducted in the Ordinary Course of Business in all
material respects or, from and after the date of the Enron Purchase Agreement, otherwise in accordance with Section 6.2, (ii) no event has occurred that would reasonably be expected to have, individually or in the aggregate, a Transfer Group
Material Adverse Effect or a Seller Material Adverse Effect or (iii) through the date of the Enron Purchase Agreement, there has not been any declaration, setting aside or payment of any dividend or other distribution (whether in cash, stock or
property) with respect to any Transfer Group Company’s capital stock to a Person who is not a Transfer Group Company. 
  
 (b) Except as expressly contemplated by this Agreement, set forth on Schedule 4.8(b) or disclosed or reflected in the Northern Border SEC Reports,
since the 

  

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Balance Sheet Date, the business of the Northern Border Companies has been conducted in the ordinary course of business and, to Seller’s Knowledge, no
event has occurred that would reasonably be expected to have, individually or in the aggregate, a Transfer Group Material Adverse Effect. 
  
 4.9 Title to Properties. 
  
 (a) Except as set forth on Schedule 4.9(a), each of the Transfer Group Companies has good and valid title to or holds a valid leasehold, license or
other interest in, or right-of-way easement through (collectively, the “Rights of Way”), all real property used by it in the Ordinary Course of Business, with such exceptions as would not reasonably be expected to have, individually
or in the aggregate, a Transfer Group Material Adverse Effect, in each case free and clear of all Liens, except for (i) Liens set forth on Schedule 4.9(a) and (ii) Permitted Exceptions. 
  
 (b) With respect to each material parcel of real property that is leased by a
Transfer Group Company as tenant (the “Leased Real Property”), to the Knowledge of Seller, (i) none of the Transfer Group Companies has received any notice of default under any lease pertaining to any of the Leased Real Property in
the twelve (12) month period prior to the date of the Enron Purchase Agreement and (ii) there are no uncured defaults under any lease without regard to when notice may have been given that would give the counterparty the right to terminate such
lease, in each case with such exceptions as would not reasonably be expected to have, individually or in the aggregate, a Transfer Group Material Adverse Effect. 
  
 (c) Each of the Transfer Group Companies has good and marketable title to all personal property reflected in the Financial
Statements or acquired after the Balance Sheet Date, but not including any personal property disposed of in the Ordinary Course of Business since the Balance Sheet Date, and with such exceptions as would not reasonably be expected to have,
individually or in the aggregate, a Transfer Group Material Adverse Effect, in each case free and clear of all Liens, except for (i) Liens set forth on Schedule 4.9(c) and (ii) Permitted Exceptions. 
  
 4.10 Intangible Property. Except as set forth on Schedule 4.10,
none of the Transfer Group Companies has any interest in any material patents, patent licenses, trade names, trademarks, service marks or copyrights. Except as set forth on Schedule 4.10, to Seller’s Knowledge, the use of any
intellectual property set forth on Schedule 4.10 by the Transfer Group Companies does not conflict with the asserted rights of others, with such exceptions as would not reasonably be expected to have, individually or in the aggregate, a
Transfer Group Material Adverse Effect. 
  
 4.11 Material
Contracts. 
  
 (a) Set forth on Schedule 4.11(a) is a
list of the following Contracts to which a Transfer Group Company is a party or by which any Transfer Group Company is 

  

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bound as of the date of the Enron Purchase Agreement (collectively, the “Material Contracts”): 
  
 (i) any Contract relating to indebtedness for borrowed
money, letter of credit or guarantee of the indebtedness for borrowed money of Persons other than the Transfer Group Companies (excluding renewals and extensions of credit) that Seller reasonably anticipates will, in accordance with its terms,
involve aggregate payments by a Transfer Group Company of more than $2,000,000 within its remaining term; 
  
 (ii) any lease under which any Transfer Group Company is the lessor or lessee of real or personal property, which lease (A) cannot be
terminated by such Transfer Group Company without payment penalty upon not more than one hundred and eighty (180) days’ notice and (B) involves an annual base rental in excess of $2,000,000; 
  
 (iii) any Contract that expressly limits in any material
respect the ability of a Transfer Group Company to (A) engage in any of its existing lines of business or to conduct any such business in any particular geographic area or (B) compete with any other Person in any such business; 
  
 (iv) any employment or consulting Contract for employees,
officers, directors or consultants of a Transfer Group Company whose guaranteed annual compensation thereunder is in excess of $200,000 annually for either of the calendar years 2003 or 2004 and that cannot be terminated on thirty (30) days’
notice without penalty or other future obligation; 
  
 (v) any Contract for the pending purchase by or sale of real or personal property of a Transfer Group Company (other than ordinary course sales of natural gas, natural gas liquids or other items of inventory) for an amount in excess of
$2,000,000; 
  
 (vi) any Contract relating to gas
purchase, gas sale, gas processing, gas storage, natural gas liquids sale or gathering that Seller reasonably anticipates will, in accordance with its terms, require payments by a Transfer Group Company in excess of $5,000,000 within the twelve (12)
month period ending December 31, 2004; 
  
 (vii)
any firm transportation Contract that requires, in accordance with its terms, payments to a Transfer Group Company in excess of $5,000,000 within the twelve (12) month period ending December 31, 2004, and any interruptible transportation Contract
that Seller reasonably anticipates will, in accordance with its terms, involve payments to a Transfer Group Company in excess of $5,000,000 within the twelve (12) month period ending December 31, 2004 (collectively, the “Transportation
Contracts”); 
  

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 (viii) any Contract requiring a capital expenditure or a commitment for a capital
expenditure by a Transfer Group Company not contemplated by the capital forecast information previously provided to Purchaser and in excess of $2,000,000; 
  
 (ix) any Contract not in the Ordinary Course of Business and requiring expenditures by a Transfer Group Company in excess of $2,000,000
annually; 
  
 (x) any hedging Contract, forward
sale Contract and derivative Contract in excess of a notional amount of $2,000,000 and a term longer than one (1) year; 
  
 (xi) any partnership or joint venture Contract between a Transfer Group Company and any other Person (other than a Transfer Group Company)
containing a commitment to fund, loan or pay amounts in excess of $2,000,000; and 
  
 (xii) any Contract for the purchase or sale of any assets of any of the Transfer Group Companies for consideration in excess of
$2,000,000. 
  
 (b) Set forth on Schedule 4.11(b) is a list
of each Contract that a Transfer Group Company has with any Enron Seller or any Affiliate of any Enron Seller (other than a Transfer Group Company), as of the date of the Enron Purchase Agreement (collectively, the “Affiliate
Contracts”). 
  
 (c) Except as set forth on Schedule
4.11(c), all of the Material Contracts are in full force and effect and are the legal, valid and binding obligations of the Transfer Group Company party thereto, and, to the Knowledge of Seller, each of the other parties thereto, except (i) to
the extent that such enforceability may be limited by bankruptcy, insolvency reorganization, moratorium or other similar laws relating to creditors’ rights generally, subject to general principles of equity, (ii) to the extent such Contract has
expired by its terms and (iii) for such exceptions that would not reasonably be expected to have, individually or in the aggregate, a Transfer Group Material Adverse Effect. In addition, (x) none of the Transfer Group Companies is in default under
any Material Contract, which default has not been waived, and (y) to the Knowledge of Seller, no other party to any Material Contract is in default under any Material Contract, except, in the case of (x) and (y), for any default that would not
reasonably be expected to have, individually or in the aggregate, a Transfer Group Material Adverse Effect. 
  
 4.12 Firm and Interruptible Transportation Contracts. Except as set forth on Schedule 4.12, (a) none of the Transfer Group Companies has
received notice that it is subject to any pending dispute with any of the counterparties under any Transportation Contract (the “Principal Shippers”), (b) no Principal Shipper has notified 

  

 13 

 
any of the Transfer Group Companies in writing of any adverse modification or change in such Transportation Contract and (c) none of the Transfer Group
Companies has received formal written notice from any Principal Shipper expressing its intention to terminate any Transportation Contract except for those exceptions to (a), (b) and (c) that would not reasonably be expected to have, individually or
in the aggregate, a Transfer Group Material Adverse Effect. 
  
 4.13 Employee Benefits. 
  
 (a) Schedule
4.13(a) sets forth a list of all material “employee benefit plans”, as defined in Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), sponsored or maintained by any
Transfer Group Company or to which any Transfer Group Company contributes or is obligated to contribute thereunder with respect to current or former officers, directors or employees of the Transfer Group Companies or with respect to which any
Transfer Group Company may have material liability (the “Employee Benefit Plans”). 
  
 (b) Except as already listed on Schedule 4.13(a), Schedule 4.13(b) sets forth a list of all material bonus plans, employment, change in
control, consulting or other compensation agreements, incentive, equity or equity-based compensation, deferred compensation arrangements, stock purchase, fringe benefit, severance pay, sabbatical or paid time off, sick leave, vacation pay, salary
continuation, disability, hospitalization, medical insurance, life, dental, vision, accidental death and dismemberment or other insurance benefits, scholarship programs or any other employee benefit plan, program or arrangement sponsored or
maintained by any Transfer Group Company or to which any Transfer Group Company contributes or is required to contribute thereunder with respect to current or former officers, directors or employees of the Transfer Group Companies or with respect to
which any Transfer Group Company may have material liability (together with the Employee Benefit Plans, the “Benefit Arrangements”). 
  
 (c) True and correct copies of the following documents, to the extent applicable and in Seller’s possession, with respect to each of the Benefit
Arrangements, have been made available or delivered to Purchaser: (i) any plans and related trust documents, and all amendments thereto and, with respect to any Benefit Arrangements sponsored or maintained by the Transfer Group Companies, all
material contracts or material agreements related to such plans, (ii) the Forms 5500 for the most recent three (3) years and schedules thereto, (iii) financial statements and actuarial valuations for the current year, to the extent available, and
for the most recent three (3) years, (iv) the most recent IRS determination letter, (v) the most recent summary plan descriptions and material modifications and (vi) written descriptions of all non-written Benefit Arrangements. 
  
 (d) Except as set forth on Schedule 4.13(d), each of the Benefit
Arrangements has been maintained in accordance with its terms and all provisions of Applicable Law, except where the failure to do so would not reasonably be expected to 

  

 14 

 
have, individually or in the aggregate, a Seller Material Adverse Effect or a Transfer Group Material Adverse Effect. 
  
 (e) Except as set forth on Schedule 4.13(e), no Benefit Arrangement
(i) is a “multiemployer plan” as defined in Section 3(37) of ERISA, or (ii) is a “multiple employer welfare arrangement” as defined in Section 3(40)(A) of ERISA. During the six (6) years immediately
prior to the Closing, no Transfer Group Company has incurred or experienced an event that has given rise, or could reasonably be expected to give rise, to a withdrawal liability under Section 4201, 4063 or 4064 of ERISA or any actual or contingent
liability under Section 4201 of ERISA except for any such liability that does not have and would not reasonably be expected to have a Seller Material Adverse Effect or a Transfer Group Material Adverse Effect. 
  
 (f) No Benefit Arrangement is a foreign plan governed by the laws of a
foreign jurisdiction. 
  
 (g) Except as set forth on Schedule
4.13(g), the consummation of the transactions contemplated by this Agreement (either alone or together with another event) will not entitle any Person to any material benefit under any Benefit Arrangement or materially accelerate vesting,
payment or materially increase the amount of compensation due to any Person. 
  
 (h) Except as set forth on Schedule 4.13(h), no Transfer Group Company has any obligation with respect to the Enron Corp. Cash Balance Plan (the “Cash Balance Plan”) to directly or indirectly
indemnify any individual fiduciary with respect to such plan in his or her capacity as a fiduciary of the plan. 
  
 (i) With respect to each Benefit Arrangement which is sponsored by a Transfer Group Company or any such plan or arrangement or portion thereof which after
the Closing Date will be sponsored or maintained by a Transfer Group Company, there are no material claims pending (other than routine claims for benefits), no prohibited transaction involving the assets of any such plan or arrangement and all
contributions required to have been made have been made or properly accrued. 
  
 (j) As of June 24, 2004, the Cash Balance Plan has not received an unfavorable ruling on a determination letter request from the IRS. 
  
 4.14 Taxes. 
  
 (a) Except as set forth on Schedule 4.14(a), all income and franchise Tax Returns and all other material Tax Returns required to be filed by, or
with respect to, the Transfer Group Companies (i) have been filed and (ii) all Taxes that were shown to be due on such Tax Returns have been paid, except where the failure to file such Tax Returns or to pay such Taxes would not reasonably be
expected to have, individually or in the aggregate, a Transfer Group Material Adverse Effect. 
  

 15 

 (b) Except as set forth on Schedule 4.14(b), (i) there are no outstanding agreements extending or
waiving the statutory period of limitation applicable to any claim for, or the period for the collection or assessment or reassessment of, Taxes due from the Transfer Group Companies for any taxable period that would reasonably be expected to have,
individually or in the aggregate, a Transfer Group Material Adverse Effect, and (ii) no power of attorney is currently in force with respect to any matter relating to Taxes of any of the Transfer Group Companies. The period for assessment for
federal income Taxes of the Enron Sellers and the Transfer Group Companies is closed for Tax periods beginning before January 1, 1996. 
  
 (c) Except as set forth on Schedule 4.14(c), none of the Transfer Group Companies has been a member of a group which files a consolidated federal
income tax return other than a group in which Enron is the parent. 
  
 (d) Seller is not a foreign person within the meaning of Section 1445 of the Code. 
  
 (e) Except as set forth on Schedule 4.14(e), none of the Transfer Group Companies has any liability for the Taxes of any Person as defined in Section 7701 (a)(1) of the Code (other than another Transfer Group
Company) under Treasury Regulation Section 1.1502-6 (or any similar provision of state, local or foreign law), as a transferee or successor, by contract or otherwise, in each case where such liability for Taxes would reasonably be expected to have,
individually or in the aggregate, a Transfer Group Material Adverse Effect. 
  
 4.15 Labor. 
  
 (a) None of
the Transfer Group Companies is a party to any labor or collective bargaining agreement, and there are no labor or collective bargaining agreements that pertain to employees of the Transfer Group Companies. 
  
 (b) There are no pending strikes, work stoppages, slowdowns, lockouts or
arbitrations against any Transfer Group Company that would reasonably be expected to have, individually or in the aggregate, a Transfer Group Material Adverse Effect. There are no pending unfair labor practice charges, grievances or complaints filed
with any Governmental Authority based on the employment or termination by any Transfer Group Company of any individual that would reasonably be expected to have, individually or in the aggregate, a Transfer Group Material Adverse Effect. 

 
 4.16 Litigation. Except as set forth on Schedule 4.16, there
are no Actions or Orders pending or, to Seller’s Knowledge, overtly threatened against Seller or any Transfer Group Company that seek to restrain or prohibit or otherwise challenge the consummation, legality or validity of the transactions
contemplated hereby or that would 

  

 16 

 
reasonably be expected to have, individually or in the aggregate, a Seller Material Adverse Effect or a Transfer Group Material Adverse Effect. 

 
 4.17 Compliance with Laws; Permits. 
  
 (a) Except with respect to Environmental Laws (which are addressed in Section
4.18) and Employee Benefits (which are addressed in Section 4.13(e)), and except as set forth on Schedule 4.17(a), each of the Transfer Group Companies is in compliance with all Applicable Laws, except for such non-compliances as would not
reasonably be expected to have, individually or in the aggregate, a Transfer Group Material Adverse Effect. Each of the Transfer Group Companies has all Permits from any Governmental Authority that are required to operate its respective business,
except for those the absence of which would not reasonably be expected to have, individually or in the aggregate, a Seller Material Adverse Effect or a Transfer Group Material Adverse Effect. 
  
 (b) Except as disclosed in the Northern Border SEC Reports, the Northern
Border Companies (i) are in compliance with all Applicable Laws, except for such non-compliances as would not reasonably be expected to have, individually or in the aggregate, a Transfer Group Material Adverse Effect and (ii) have all Permits from
any Governmental Authority that are required to operate their respective businesses, except for those the absence of which would not reasonably be expected to have, individually or in the aggregate, a Transfer Group Material Adverse Effect.

  
 4.18 Environmental Matters. Except as set forth on
Schedule 4.18 and except for facts, circumstances or conditions that would not reasonably be expected to have, individually or in the aggregate, a Transfer Group Material Adverse Effect: 
  
 (a) The operations of the Transfer Group Companies are in compliance with all
Environmental Laws, which compliance includes the possession and maintenance of, and compliance with, all Permits required under all applicable Environmental Laws; 
  
 (b) None of the Transfer Group Companies is the subject of any outstanding Order with any Governmental Authority under any
Environmental Laws; 
  
 (c) There are no investigations of the
business, operations, or currently or previously owned, operated or leased property of the Transfer Group Companies pending or, to the Knowledge of Seller, threatened, that could reasonably be expected to result in the Transfer Group Companies
incurring any liability pursuant to any Environmental Law; and 
  
 (d) None of the Transfer Group Companies is subject to any pending, or, to the Knowledge of Seller, threatened Action, whether judicial or administrative, alleging noncompliance with or potential liability under any Environmental Law.

  

 17 

 4.19 Insurance. Set forth on Schedule 4.19 is a list of all material policies of insurance
by which the Transfer Group Companies’ assets or business activities are covered as of the date of the Enron Purchase Agreement. Except as set forth on Schedule 4.19, to the Knowledge of Seller, all such policies are in full force and
effect and there are no claims pending as of the date of the Enron Purchase Agreement under any of such policies where underwriters have reserved their rights or disclaimed coverage under such policies with such exceptions in each case that would
not reasonably be expected to have, individually or in the aggregate, a Transfer Group Material Adverse Effect. To Seller’s Knowledge, such insurance is maintained with amounts and deductibles and/or self-insured retentions as are customarily
maintained by entities engaged in business of the same type and size as such Transfer Group Company with such exceptions that, in the event of a loss, would not reasonably be expected to have, individually or in the aggregate, a Transfer Group
Material Adverse Effect. 
  
 4.20 Financial Advisors.
Except as set forth on Schedule 4.20, no Person has acted, directly or indirectly, as a broker, finder or financial advisor for Seller or its Affiliates in connection with the transactions contemplated by this Agreement. Neither Purchaser nor
any Transfer Group Company or Northern Border Company is or will become obligated to pay any fee or commission or like payment to any broker, finder or financial advisor as a result of the consummation of the transactions contemplated by this
Agreement based upon any arrangement made by or on behalf of Seller or any of its Affiliates. 
  
 4.21 No Knowledge of Breach. To the actual knowledge of Seller without inquiry, the Enron Sellers have not breached any of their representations and warranties or covenants set forth in the Enron Purchase
Agreement. 
  
 4.22 Limitation of Representations and
Warranties. EXCEPT FOR THE REPRESENTATIONS AND WARRANTIES SET FORTH IN ARTICLE IV OF THIS AGREEMENT, SELLER IS NOT MAKING ANY OTHER REPRESENTATIONS OR WARRANTIES, WRITTEN OR ORAL, STATUTORY, EXPRESS OR IMPLIED, CONCERNING THE EQUITY INTEREST, OR
THE BUSINESS, ASSETS OR LIABILITIES OF THE TRANSFER GROUP COMPANIES OR THE NORTHERN BORDER COMPANIES. PURCHASER ACKNOWLEDGES THAT, EXCEPT AS EXPRESSLY PROVIDED IN THIS AGREEMENT, SELLER HAS NOT MADE, AND SELLER HEREBY EXPRESSLY DISCLAIMS AND
NEGATES, AND PURCHASER HEREBY EXPRESSLY WAIVES, ANY REPRESENTATION OR WARRANTY, EXPRESS, IMPLIED, AT COMMON LAW, BY STATUTE OR OTHERWISE RELATING TO, AND PURCHASER HEREBY EXPRESSLY WAIVES AND RELINQUISHES ANY AND ALL RIGHTS, CLAIMS AND CAUSES OF
ACTION AGAINST SELLER AND ITS REPRESENTATIVES IN CONNECTION WITH THE ACCURACY, COMPLETENESS OR MATERIALITY OF ANY INFORMATION, DATA OR OTHER MATERIALS (WRITTEN OR ORAL) HERETOFORE FURNISHED TO PURCHASER AND ITS REPRESENTATIVES BY OR ON BEHALF OF
SELLER. WITHOUT LIMITING THE FOREGOING, SELLER IS NOT MAKING ANY REPRESENTATION OR WARRANTY TO PURCHASER 

  

 18 

 
WITH RESPECT TO (A) THE INFORMATION SET FORTH IN THE NORTHERN PLAINS NATURAL GAS COMPANY CONFIDENTIAL INFORMATION MEMORANDUM DATED AS OF JULY 2002 OR (B) ANY
FINANCIAL PROJECTION OR FORECAST RELATING TO THE BUSINESS, ASSETS OR LIABILITIES OF ANY OF THE TRANSFER GROUP COMPANIES OR THE NORTHERN BORDER COMPANIES. WITH RESPECT TO ANY PROJECTION OR FORECAST DELIVERED ON BEHALF OF SELLER TO PURCHASER OR ITS
REPRESENTATIVES, PURCHASER ACKNOWLEDGES THAT (W) THERE ARE UNCERTAINTIES INHERENT IN ATTEMPTING TO MAKE SUCH PROJECTIONS AND FORECASTS, (X) IT IS FAMILIAR WITH SUCH UNCERTAINTIES, (Y) IT IS TAKING FULL RESPONSIBILITY FOR MAKING ITS OWN EVALUATION OF
THE ADEQUACY AND ACCURACY OF ALL SUCH PROJECTIONS AND FORECASTS FURNISHED TO IT AND (Z) IT SHALL HAVE NO CLAIM AGAINST SELLER OR ITS AFFILIATES WITH RESPECT THERETO. NOTWITHSTANDING ANY PROVISION HEREOF TO THE CONTRARY, TO THE EXTENT THAT THE
CONVERSION TRANSACTIONS (AS DEFINED IN THE ENRON PURCHASE AGREEMENT) CAUSE SELLER TO BREACH ANY REPRESENTATION, WARRANTY, COVENANT OR OTHER AGREEMENT OF SELLER CONTAINED IN THIS AGREEMENT, SUCH BREACH SHALL BE GIVEN NO EFFECT, AND PURCHASER SHALL
HAVE NO RIGHT TO (I) TERMINATE THIS AGREEMENT DUE TO SUCH BREACH BY SELLER OR THE FAILURE OF SELLER TO MEET ANY OF THE CONDITIONS SET FORTH IN SECTIONS 7.1 OR 7.2 BY THE OUTSIDE DATE AS A RESULT OF THE CONVERSION TRANSACTIONS (AS DEFINED IN THE
ENRON PURCHASE AGREEMENT) (FOR THE AVOIDANCE OF DOUBT, SUCH BREACH SHALL IN NO WAY RELIEVE PURCHASER OF ITS OBLIGATIONS TO CLOSE THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT), OR (II) TO SEEK INDEMNIFICATION FROM SELLER FOR SUCH BREACH.

  
 ARTICLE V 
  
 REPRESENTATIONS AND WARRANTIES OF PURCHASER 
  
 Purchaser hereby represents and warrants to Seller as follows: 
  
 5.1 Organization and Good Standing. Purchaser is a corporation duly
organized, validly existing and in good standing under the laws of the State of Oklahoma. 
  
 5.2 Authorization of Agreement. Purchaser has the requisite power and authority to execute this Agreement and the Transaction Documents to which it is a party and to consummate the transactions contemplated by
this Agreement and the Transaction Documents to which it is a party. The execution and delivery of this Agreement and the Transaction Documents to which Purchaser is a party by Purchaser and the consummation by Purchaser of the transactions
contemplated by this Agreement and the Transaction Documents to which it is a party have been duly authorized by all necessary action on the part of Purchaser. This Agreement and the Transaction 

  

 19 

 
Documents to which Purchaser is a party have been duly executed and delivered by Purchaser and, assuming due execution and delivery by Seller, constitute the
valid and binding obligations of Purchaser, enforceable against Purchaser in accordance with their respective terms. 
  
 5.3 No Violation; Consents. 
  
 (a) Except as set forth on Schedule 5.3(a), the execution and delivery by Purchaser of this Agreement and the Transaction Documents to which
Purchaser is a party and the consummation of the transactions contemplated hereby and thereby do not and will not (i) violate any provision of the bylaws, certificate of incorporation or other similar organizational documents of Purchaser, (ii)
conflict with, require the consent of a third party under, violate, result in the breach of, constitute a default under, or give rise to any right of acceleration, cancellation or termination of any material right or obligation of Purchaser under
any material agreement or other instrument to which Purchaser is a party or by which Purchaser or any of its properties or assets are bound, (iii) violate any Order of any Governmental Authority to which Purchaser is bound or subject or (iv) violate
any Applicable Law, other than, in the case of clauses (ii) through (iv), any conflict, violation, breach, default, requirement for consents, rights of acceleration, cancellation, termination or Lien that would not reasonably be expected to have,
individually or in the aggregate, a Purchaser Material Adverse Effect. 
  
 (b) Except as set forth on Schedule 5.3(b) and except for (i) filings as may be required under the HSR Act and (ii) such filings with, and orders of, the FCC as may be required under the Communications Act, no Order or Permit issued
by, or declaration or filing with, or notification to, or waiver from or consent from, any Governmental Authority is required on the part of Purchaser in connection with the execution and delivery of this Agreement, or the compliance or performance
by Purchaser with any of the provisions contained in this Agreement or the consummation of the transactions contemplated hereby, except for any such requirements, the failure of which to be obtained or made would not reasonably be expected to have,
individually or in the aggregate, a Purchaser Material Adverse Effect. 
  
 5.4 Litigation. There is no Action or Order pending or, to the knowledge of Purchaser, threatened against Purchaser or any of its Affiliates or Subsidiaries that seeks to restrain or prohibit or otherwise challenge the consummation,
legality or validity of the transactions contemplated hereby or which would reasonably be expected to have, individually or in the aggregate, a Purchaser Material Adverse Effect. 
  
 5.5 Investment Intention. Purchaser is acquiring the Equity Interest for its own account, for investment purposes
only and not with a view to the distribution (as such term is used in Section 2(a)(11) of the Securities Act) thereof Purchaser understands that the Equity Interest has not been registered under the Securities Act and cannot be sold unless
subsequently registered under the Securities Act or an exemption from such registration is available. 
  

 20 

 5.6 Financial Capability. Purchaser has, and will have at all times on and prior to the Closing
Date, sufficient cash and cash equivalents and/or credit facilities in immediately available funds (and has provided Seller with evidence thereof) to purchase the Equity Interest at the Purchase Price and to consummate the transactions contemplated
by this Agreement, including, without limitation, payments of fees and expenses contemplated hereunder. 
  
 5.7 Financial Advisors. Except as set forth on Schedule 5.7, no Person has acted, directly or indirectly, as a broker, finder or financial
advisor for Purchaser in connection with the transactions contemplated by this Agreement and no Person is entitled to any fee or commission or like payment in respect thereof. 
  
 ARTICLE VI 
  
 COVENANTS 
  
 6.1 Access to Information. Prior to Closing, pursuant to the Enron Purchase Agreement, Seller shall request, and use commercially reasonable
efforts to have such request honored, that the Transfer Group Companies permit Purchaser and its Representatives (including its legal advisors and accountants) to have reasonable access, during normal business hours and upon reasonable advance
notice, to the properties, books, records and personnel of the Transfer Group Companies; provided, that in no event shall Seller or any Transfer Group Company be obligated to provide (i) access or information in violation of Applicable Law, (ii)
bids, letters of intent, expressions of interest or other proposals received from others in connection with the transactions contemplated by this Agreement and information and analysis relating to such communications or (iii) any information, the
disclosure of which would jeopardize any privilege available to Seller, any of the Transfer Group Companies or any of their respective Affiliates relating to such information or would cause Seller, any of the Transfer Group Companies or any of their
respective Affiliates to breach a confidentiality obligation to which it is bound. If Purchaser cannot obtain such access, Seller shall obtain and deliver to the Purchaser such documents and information as Purchaser may reasonably request, to the
extent that Seller has access to such documents and information under the Enron Purchase Agreement. In connection with such access, Purchaser’s Representatives shall cooperate with Seller and the Transfer Group Companies’ Representatives
and shall use their commercially reasonable efforts to minimize any disruption of the business of Seller and the Transfer Group Companies. Purchaser agrees to abide by the terms of the Confidentiality Agreement and any safety rules or rules of
conduct reasonably imposed by the relevant Seller or Transfer Group Company with respect to such access and any information furnished to them or their Representatives pursuant to this Section 6.1. Purchaser shall indemnify, defend and hold harmless
the Seller Indemnified Parties and the Transfer Group Companies from and against any and all Losses asserted against or suffered by them relating to, resulting from, or arising out of, examinations or inspections made by Purchaser or its
Representatives pursuant to this Section 6.1. If Seller becomes aware prior to Closing of any breach by any of the Enron 

  

 21 

 
Sellers of any of their representations and warranties or covenants set forth in the Enron Purchase Agreement, Seller shall notify Purchaser in writing
within five (5) Business Days after becoming actually aware of such breach. Seller shall promptly forward to Purchaser any documents and other information provided to Seller under the Enron Purchase Agreement relating to the transactions
contemplated hereunder. 
  
 6.2 Conduct of the Business Pending
the Closing. 
  
 (a) Except as otherwise expressly
contemplated by this Agreement and the schedules attached hereto or with the prior written consent of Purchaser (which consent shall not be unreasonably withheld, delayed or conditioned), during the period from the date of this Agreement to and
through the Closing Date, pursuant to the Enron Purchase Agreement, Seller shall request, and use commercially reasonable efforts to have such request honored, that the Transfer Group Companies (A) conduct their respective businesses in all material
respects in the Ordinary Course of Business, and (B) preserve in all material respects the present business operations, organization and goodwill of the Transfer Group Companies. For the avoidance of doubt, the foregoing shall not require Seller or
any of the Transfer Group Companies to make any payments, incur any costs or enter into or amend any contractual arrangements, agreements or understandings, unless such payment, incurrence or other action is required by Applicable Law, by
contractual obligation with such third parties or to operate in the Ordinary Course of Business. 
  
 (b) Except as otherwise expressly contemplated by this Agreement or with the prior written consent of Purchaser (which consent shall not be unreasonably
withheld, delayed or conditioned), pursuant to the Enron Purchase Agreement, Seller shall request, and shall use commercially reasonable efforts to have such request honored, that none of the Transfer Group Companies shall: 
  
 (i) except as set forth on Schedule 6.2(b)(i) or as
contemplated by the Contribution Agreement or in the schedules thereto, declare, set aside, make or pay any non-cash dividend or other non-cash distribution in respect of the capital stock of any Transfer Group Company or repurchase, redeem or
otherwise acquire for non-cash consideration any outstanding shares of the capital stock or other securities of, or other ownership interests in, any Transfer Group Company; 
  
 (ii) except as set forth on Schedule 6.2(b)(ii), transfer, issue, sell or dispose of any shares of
capital stock or other securities of any of the Transfer Group Companies or the 500,000 common units of Northern Border beneficially owned by Northern Plains as of the date of this Agreement or grant options, warrants, calls or other rights to
purchase or otherwise acquire shares of the capital stock or other securities of the Transfer Group Companies or the 500,000 common units of Northern Border beneficially owned by Northern Plains as of the date of this Agreement; 
  

 22 

 (iii) effect any recapitalization, reclassification, stock split, or like change in the
capitalization of any Transfer Group Company; 
  
 (iv) except as set forth on Schedule 6.2(b)(iv), amend the certificate of incorporation, bylaws or other organizational documents of any of the Transfer Group Companies; 
  
 (v) except as provided under the severance and retention plans and other employment arrangements listed on
Schedule 6.2(b)(v) and except as would not create or increase any liability of any Northern Plains Group Company beyond any amount reflected on the Balance Sheets, (A) materially increase the annual level of compensation of any employee of
the Transfer Group Companies (other than increases in the Ordinary Course of Business and that in the aggregate will not result in a material increase in the benefits or compensation expense of the Transfer Group Companies taken as a whole), (B)
grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultant of the Transfer Group Companies, other than in the Ordinary Course of Business, (C) materially increase the coverage
or benefits available under any (or, except as permitted under clause (D) or as provided on Schedule 6.2(b)(v), create or adopt any new) Benefit Arrangement, Employee Benefit Plan or arrangement made to, for, or with any of the directors,
officers, employees, agents or representatives of the Transfer Group Companies or otherwise materially modify or amend or terminate any such arrangement or plan or (D) other than in the Ordinary Course of Business, hire any person or enter into any
employment, deferred compensation, severance, consulting, or similar agreement (or amend any such agreement) to which any Transfer Group Company is a party or involving a director, officer or employee of the Transfer Group Companies in his or her
capacity as a director, officer or employee of the Transfer Group Companies, other than (1) with respect to any Person who fills a vacant position or (2) with respect to a technical consulting engagement; provided that any such agreement or
amendment (x) has a term of one year or less, and in the case of (1), provides for no increase in compensation other than in the Ordinary Course of Business and, (y) in the case of (2), will not provide the technical consultant with more than
$200,000 of base annual salary, or (z) in the case of hirings, agreements and amendments that do not meet the requirements of subclauses (x) or (y) will not, when aggregated with all other such hirings, agreements and amendments that do not meet the
requirements of subclauses (x) or (y), require total payments of base annual salary in excess of $2,000,000 or payments to any individual in excess of $350,000. 
  
 (vi) except as set forth on Schedule 6.2(b)(vi) and except for (A) trade payables, (B) indebtedness
under existing lines of credit, (C) any extension, renewal or refinancing of existing indebtedness, (D) indebtedness for 

  

 23 

 
borrowed money incurred or guarantees issued in the Ordinary Course of Business and (E) indebtedness in an amount sufficient to allow the Transfer Group
Companies to make any required capital contributions in accordance with the terms of the Northern Border Partnership Agreement, borrow monies for any reason, draw down on any line of credit or debt obligation, or become the guarantor, surety,
endorser or otherwise liable for any debt, obligation or liability (contingent or otherwise) of any other Person (other than another Transfer Group Company or any Northern Border Company); 
  
 (vii) subject any of the material properties or assets
(whether tangible or intangible) of the Transfer Group Companies to any Lien, except for (A) Permitted Exceptions or (B) Liens arising in the Ordinary Course of Business or by operation of Law, or subject the Equity Interest to any Lien; 

 
 (viii) except as set forth on Schedule
6.2(b)(viii), (A) acquire any properties or assets other than in the Ordinary Course of Business, except for any such acquisitions of properties or assets with a fair market value of up to $5,000,000 in the aggregate or (B) sell, assign,
transfer, convey, lease or otherwise dispose of any of the material properties or assets of the Transfer Group Companies other than in the Ordinary Course of Business, except for any such dispositions of properties or assets with a fair market value
of up to $5,000,000 in the aggregate; 
  
 (ix)
until written notice is provided to Purchaser, enter into any labor or collective bargaining agreement of the Transfer Group Companies, through negotiation or otherwise, or make any material commitment or incur any material liability to any labor
organization with respect to the Transfer Group Companies; 
  
 (x) except as set forth on Schedule 6.2(b)(x), repurchase, discharge or satisfy any claim, debt or obligation of any of the Transfer Group Companies in an amount in excess of $2,000,000 in the aggregate, other
than (A) in the Ordinary Course of Business, (B) pursuant to the terms of any Contract as in effect on the date of this Agreement or permitted to be entered into hereafter or (C) in the pursuit, prosecution or resolution of any pending FERC
proceedings; 
  
 (xi) permit any of the Transfer
Group Companies to enter into, or agree to enter into, any merger or consolidation with, any corporation or other entity; 
  
 (xii) pursuant to or within the meaning of the Bankruptcy Code or any similar federal, state or foreign law for the relief of debtors,
commence a voluntary case, consent to the entry of an Order for relief against any of them in an involuntary case, consent to the appointment of a receiver, trustee, assignee, 

  

 24 

 
liquidator or similar official of them or for all or substantially all of its property or assets, or make a general assignment for the benefit of its
creditors; 
  
 (xiii) fail to maintain, in full
force and effect, to the extent commercially reasonably available, insurance coverage that is equivalent in all material respects to the insurance coverage currently in effect for the Transfer Group Companies under the Insurance Policies or
comparable insurance; provided, however, that Seller shall not be in breach of this Section 6.2(b)(xiii) if any current insurer refuses to renew or continue to extend insurance coverage to the Transfer Group Companies so long as Seller
uses commercially reasonable efforts to obtain equivalent insurance coverage from another reputable insurer and nothing herein shall prevent Seller from replacing any existing insurance from a current insurer with substantially equivalent insurance
from another reputable insurer; 
  
 (xiv) amend,
modify or change the Principal Contribution Transaction Documents (other than with respect to the Sublease and Tax Sharing Agreement and amendments contemplated in the Enron Purchase Agreement, including as provided in Section 8.1(g) of the Enron
Purchase Agreement); 
  
 (xv) except as set forth
on Schedule 6.2(b)(xv) make any single loan, advance or capital contribution to, or investment in, any Person who is not a Transfer Group Company or Northern Border Company (or any entity in which a Northern Border Company has an ownership
interest) in excess of $5,000,000 or a series of such loans, advances and capital contributions to, or investments in, any such Person in excess of $15,000,000 in the aggregate, except for loans, advances, capital contributions and investments (A)
pursuant to and in accordance with the terms of any Material Contract, in each case existing as of the date of this Agreement, or (B) in the Ordinary Course of Business; 
  
 (xvi) except as set forth on Schedule 6.2(b)(xvi), make or commit to make any single capital
expenditure in excess of $5,000,000 or commit to make a series of capital expenditures in excess of $15,000,000 in the aggregate (in each case, other than capital expenditures included in the capital forecast previously provided to Purchaser); or

  
 (xvii) authorize, or commit or agree to take,
any of the actions referred to in paragraphs (i) through (xvi) above. 
  
 6.3 Appropriate Action; Filings. 
  
 (a) Through
the Closing Date, Seller and Purchaser will each cooperate with each other and use (and will cause their respective Subsidiaries and Affiliates to use) 

  

 25 

 
commercially reasonable efforts (i) to take, or to cause to be taken, all actions, and to do, or to cause to be done, all things reasonably necessary, proper
or advisable on its part under this Agreement, Applicable Law or otherwise to consummate and make effective the transactions contemplated by this Agreement, (ii) to obtain promptly from any Governmental Authority any Orders or Permits required to be
obtained by Seller or Purchaser or any of their respective Subsidiaries in connection with the authorization, execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby, (iii) to promptly make
all necessary filings, and thereafter make any other required submissions, with respect to this Agreement and prompt consummation of the transactions contemplated hereby required under (A) the HSR Act, (B) the Communications Act and (C) any other
Applicable Law, and (iv) to enforce the provisions of the Enron Purchase Agreement relating to the transactions contemplated hereunder in Seller’s reasonable discretion. For the avoidance of doubt, Seller shall not be obligated to pay any
consideration or incur any additional costs to obtain any consents from third parties that may be necessary, proper or advisable to consummate the transactions contemplated by this Agreement. In addition, each party will provide prompt notification
to the other party when any such Action, Order, Permit, filing, application, petition or notice referred to in the foregoing clause (iii) is obtained, taken or made, as applicable. 
  
 (b) As promptly as practicable, but in any event no later than eleven (11) days after the date hereof, Seller and Purchaser
shall each file or cause to be filed with the Federal Trade Commission (“FTC”) and the Department of Justice (“DOJ”) any notifications and report forms, together with all required supplemental information, required
to be filed under the HSR Act and the regulations promulgated thereunder with respect to the transactions contemplated by this Agreement, and request early termination of the waiting period with respect to the transactions contemplated by this
Agreement. Seller and Purchaser shall consult with each other as to the appropriate time of filing such notifications and shall use commercially reasonable efforts to make such filings at the agreed upon time, to respond promptly to any requests for
additional information made by either of such agencies, to cooperate with each other in connection with resolving any investigation or other inquiry concerning the transactions contemplated by this Agreement commenced by either of such agencies and
to cause the waiting periods under the HSR Act to terminate or expire at the earliest possible date after the date of filing; provided, that neither Seller nor Purchaser shall be required to continue to pursue approval to the extent either
agency or staff of either agency has indicated, in the good-faith belief of both Purchaser’s and Seller’s legal counsel, that it will invoke judicial process to enjoin consummation of the transactions contemplated by this Agreement prior
to the expiration of the waiting period. Purchaser will promptly take all actions within its control and necessary to comply with any requests made, or conditions set, by the FTC and the DOJ to consummate the transactions contemplated by this
Agreement, including the divestiture of assets of any Transfer Group Company or Northern Border Company; provided, however, that in no event shall Purchaser be required (i) to divest any asset or modify any arrangement with respect to
any of the operations of the Transfer Group Companies (other than any of their equity interests in, or assets of, any or all of the 

  

 26 

 
Northern Border Companies) if such divestiture or modification would have a Transfer Group Material Adverse Effect or (ii) to take or refrain from taking any
action if such action or refraining would have a Transfer Group Material Adverse Effect. Notwithstanding the foregoing, in no event shall Purchaser be required to take any action to obtain the consent or approval of the FTC or the DOJ to the
transactions contemplated hereby if the FTC or the DOJ imposes as a condition to obtaining any such consent or approval any limitations or conditions materially adverse to the business of Purchaser and its Subsidiaries, taken as a whole. 

 
 (c) As promptly as practicable, but in any event no later than two (2)
Business Days after the date hereof, Seller and Purchaser shall each file or cause to be filed with the FCC any necessary transfer applications with respect to any FCC radio stations as required under the Communications Act of 1934 and the
regulations promulgated thereunder with respect to the transactions contemplated by this Agreement. Seller and Purchaser shall consult with each other as to the appropriate time of filing such applications and shall use commercially reasonable
efforts to make such filings at the agreed upon time. After the filing of such applications with the FCC, Seller and Purchaser shall continue to monitor the processing status of such applications, will respond promptly to any requests for additional
information made by the FCC, and will file any necessary application amendments as soon as commercially practicable. Notwithstanding the foregoing, in no event shall Purchaser be required to take any action to obtain the consent or approval of the
FCC to the transactions contemplated hereby if the FCC imposes as a condition to obtaining any such consent or approval any limitations or conditions materially adverse to the business of Purchaser and its Subsidiaries, taken as a whole. 

 
 6.4 Preservation of Records; Cooperation. Subject to Section 9.2(d)
hereof (relating to the preservation of Tax records), pursuant to the Enron Purchase Agreement, Seller shall request, and shall use commercially reasonable efforts to have such request honored, that the Enron Sellers and their Affiliates shall cause
the Transfer Group Companies to, and, after the Closing Date, Purchaser shall cause the Transfer Group Companies to, preserve and keep in their possession all records held by them on and after the date of this Agreement relating to the business of
the Transfer Group Companies, until the earlier of (x) seven (7) years from the Closing Date or such longer period as may be required by Applicable Law and (y) the closing of the Enron Bankruptcy Cases, and shall make such records and then existing
personnel available to the other party as may reasonably be required by such party in connection with, among other things, any insurance claims involving, legal proceedings involving, or governmental investigations of, Seller or Purchaser or any of
their respective Affiliates or in order to enable Seller or Purchaser to comply with their respective obligations under this Agreement and each other agreement, document or instrument contemplated hereby or thereby; provided, however,
that in no event shall Seller, Purchaser or any of their respective Affiliates be obligated to provide any information the disclosure of which would (i) jeopardize any privilege available to such party relating to such information or (ii) cause such
party to breach a confidentiality obligation to which it is bound. After the 

  

 27 

 
expiration of any applicable retention period, before Purchaser shall dispose of any of such records, at least ninety (90) days prior notice to such effect
shall be given by Purchaser to Seller (or a Person designated by Seller) and Seller shall have the opportunity (but not the obligation), at its sole cost and expense, to remove and retain all or any part of such records as it may in its sole
discretion select. 
  
 6.5 Confidentiality. 
  
 (a) The parties acknowledge that Seller and Purchaser previously executed a
confidentiality agreement dated August 27, 2004, (as may be amended and supplemented, the “Confidentiality Agreement”), which Confidentiality Agreement shall continue in full force and effect until completion of the Closing, at
which time the obligations of Seller and Purchaser thereunder with respect to the Evaluation Material (as defined in the Confidentiality Agreement) relating solely to the Transfer Group Companies shall terminate. 
  
 (b) The parties agree that the terms and conditions of the transactions
contemplated by this Agreement and information provided to Purchaser and its Affiliates and Representatives and the Purchaser Related Parties in connection with the execution hereof shall be subject to the same standard of confidentiality as set
forth in the Confidentiality Agreement. 
  
 6.6 Public
Announcements. Prior to the Closing Date, neither Seller nor Purchaser, or any of their respective Affiliates or Representatives, shall (except as may otherwise be permitted under the terms of this Agreement) issue any press release or public
statement concerning this Agreement or the transactions contemplated by this Agreement without obtaining the prior written approval of the other parties hereto, unless such disclosure is required by Applicable Law, or by obligations pursuant to any
agreement with any national securities exchange; provided, that the party intending to make such release shall give the other parties prior notice and shall use its commercially reasonable efforts consistent with such Applicable Law, Order or
obligation to consult with the other parties with respect to the text thereof. 
  
 6.7 Directors’ and Officers’ Indemnification. For a period of not less than six (6) years after the Closing Date, Purchaser shall cause the certificate of incorporation and bylaws or other
organizational documents of each Transfer Group Company to continue to include the same provisions concerning the exculpation, indemnification, advancement of expenses to and holding harmless of, all past and present employees, officers, agents and
directors of such Transfer Group Company for acts or omissions occurring at or prior to the Closing as are contained in such documents as of the date of execution of this Agreement, and Purchaser shall cause each Transfer Group Company to, jointly
and severally honor all such provisions, including making any indemnification payments and expense advancements thereunder. In the event that any indemnifiable claim is asserted or made within such six (6) year period, all rights to indemnification
and advancement of expenses in respect of such claim shall continue to 

  

 28 

 
the extent currently permitted under the relevant Transfer Group Company’s certificate of incorporation and bylaws or other organizational documents
until such claim is disposed of or all Orders in connection with such claim are fully satisfied. 
  
 6.8 Further Assurances. Seller and Purchaser agree that from and after the Closing Date, each of them will, and will cause their respective
Affiliates to, execute and deliver such further instruments of conveyance and transfer and take such other action as may reasonably be requested by any party hereto to carry out the purposes and intents of this Agreement. 
  
 6.9 Financing. Purchaser shall from time to time provide such
information to Seller as Seller may reasonably request regarding Purchaser’s financial capability as set forth in Section 5.6. Purchaser agrees to notify Seller immediately if, at any time prior to the Closing Date, for any reason Purchaser no
longer believes in good faith that the representation set forth in Section 5.6 is true and correct. Purchaser shall not, or permit any of its Subsidiaries or Affiliates to, without the prior written consent of Seller, take any action or enter into
any transaction, without limitation, any merger, acquisition, joint venture, disposition, lease, contract, or debt or equity financing that would reasonably be expected to cause the representation in Section 5.6 to not be true and correct. 

  
 6.10 Payment of Pro Rata Distributions. Purchaser
agrees that within one (1) Business Days after the Northern Plains Group Companies receive any quarterly distribution (the “Northern Border Distribution”) from Northern Border in respect of their general partner interests and common
units paid after the Closing which relates to a quarter that ends prior to the Closing Date, it will cause all of the applicable Northern Plains Group Companies to pay to Seller the amount of such distribution; provided that to the extent that any
Northern Border Distribution relates to a quarter that begins prior to but ends after the Closing Date, Purchaser shall cause the applicable Northern Plains Group Companies to pay to Seller for such quarter an amount equal to the product of (a) the
aggregate amount of such Northern Border Distribution and (b) a fraction, the numerator of which is the number of days from the first day of the applicable quarter through the Closing Date and the denominator of which is ninety (90). Purchaser shall
provide Seller with a reasonably detailed calculation of any pro rata Northern Border Distribution paid to Seller pursuant to this Section 6.10. Any dispute regarding such calculation shall be resolved by an independent accounting firm chosen in the
manner provided in Schedule 2.1; provided, however, that in the event that an Accounting Referee has been appointed under the Enron Purchase Agreement to resolve a bona fide dispute thereunder, such Accounting Referee
shall serve as the Accounting Referee hereunder. Amounts paid pursuant to this Section 6.10 shall be treated as an adjustment to the Purchase Price for Tax purposes. Each of Purchaser and its Affiliates shall (a) take all actions necessary
(including voting its equity interest on behalf of the Northern Plains Group Companies) to effect, or cause to be effected, any distribution to which the Northern Plains Group Companies are entitled pursuant to the Northern Border Partnership
Agreement and (b) not take or fail to take, or cause to be taken, any action 

  

 29 

 
that would impair the ability of the Northern Plains Group Companies to receive any distribution to which it is entitled pursuant to the terms of the
Northern Border Partnership Agreement. 
  
 6.11 Guarantees.
Enron and its Affiliates are guarantors with respect to certain indebtedness of the Transfer Group Companies, as set forth on Schedule 6.11 (collectively, the “Guaranteed Indebtedness”). 
  
 6.12 Severance Agreements, Plans and Policies. 
  
 (a) For a period of twelve (12) months after the Closing Date, Purchaser
shall not, and shall cause the Transfer Group Companies not to terminate, revoke, suspend, amend, modify or otherwise change (or take any action that would cause any of the foregoing, or fail to take any action that would avoid the foregoing) any
agreement, plan, program or policy described on Schedule 4.13(a) or Schedule 4.13(b) and relating to severance or termination obligations for employees of the Transfer Group Companies in any manner that would have an adverse impact on
the employees of the Transfer Group Companies. Purchaser shall promptly reimburse Seller for any “Severance Payment Costs”, as defined in the following sentence. The term “Severance Payment Costs,” means the sum of the
individual severance payments made to any of those thirty-eight (38) current employees of CrossCountry Energy Services, LLC who 1) are deemed to be primarily providing services to the Transfer Group Companies or the Northern Border Companies, as
described in the following sentence, and 2) are entitled to benefits under the CrossCountry Energy Services, LLC Severance Pay Plan as a result of involuntary termination of employment within twelve (12) months after the Closing Date, calculated
with respect to each such individual using his or her actual years of service and his or her actual base pay; provided, however, that in no event shall Purchaser be obligated for Severance Payment Costs for any employees who are
offered employment by the Transfer Group Companies, and not entitled to severance benefits under the CrossCountry Energy Services, LLC Severance Pay Plan. Purchaser and Seller shall negotiate in good faith to determine which thirty-eight (38)
employees shall be deemed to be primarily providing services to the Transfer Group Companies or the Northern Border Companies. 
  
 (b) With respect to the partition and distribution of assets and liabilities associated with the Enron Gas Pipelines Employee Benefit Trust (the
“VEBA”) as disclosed on item 7 to Schedule 4.7(a), the amount of assets and liabilities to be transferred to, or assumed by, any Transfer Group Company shall be with respect to the current and former employees of the Transfer
Group Companies and shall be calculated in a manner consistent with the motion of the debtors filed in the Enron Bankruptcy Cases dated July 22, 2003, as may be amended, seeking approval therefore and shall be effectuated in a manner consistent with
the motion and any order of the Bankruptcy Court approving the relief requested therein. 
  

 30 

 (c) Following the date hereof, no Transfer Group Company or Northern Border Company will be required to
contribute to or otherwise be liable for any contributions in connection with the Cash Balance Plan including but not limited to, any payments or contributions pursuant to any Order of the Bankruptcy Court, the Contribution Agreement, the Transition
Services Agreement or any other agreement, including without limitation, the agreement set forth in Section 5.6(b) of the Contribution Agreement, between any of the Enron Sellers, on one hand, and the Transfer Group Companies, on the other hand,
relating to the allocation of costs of providing employee benefits to the employees of the Transfer Group Companies. For the avoidance of doubt, the Purchase Price shall be deemed to include all contributions which otherwise would have been
allocable to any Transfer Group Company and any Northern Border Company. Following receipt of the Purchase Price in accordance with the terms of this Agreement, the Transfer Group Companies and the Northern Border Companies shall be deemed to have
fully satisfied the contribution obligations that they would have been required to contribute to the Cash Balance Plan, including, without limitation, any such obligation arising pursuant to any Order of the Bankruptcy Court or any agreement
referenced in this Section 6.12(c). 
  
 6.13 Transition
Services. 
  
 (a) Pursuant to the Transition Services
Agreement and the Transition Services Supplemental Agreement, Enron has agreed to provide certain transition services to CrossCountry and CrossCountry has agreed to provide certain transition services to Enron. On and after the Closing Date, the
parties will undertake commercially reasonable efforts to implement the following transition arrangements: (i) Purchaser will cause the Transfer Group Companies to provide certain transition services to Enron as required by the Transition Services
Agreement and the Transition Services Supplemental Agreement on behalf of CrossCountry; (ii) Purchaser will provide, or cause the provision of, certain transition services to Seller; (iii) Seller will provide, or cause the provision of, certain
transition services to the Transfer Group Companies and/or the Northern Border Companies; and (iv) Seller will request, and use commercially reasonable efforts to have such request honored, that Enron provide any and all transition services to be
performed for the Transfer Group Companies and /or the Northern Border Companies as required by the Transition Services Agreement and the Transition Services Supplemental Agreement. Purchaser and Seller agree to cooperate in identifying the
transition services contemplated in items (i) through (iv) above and in determining how such transition services will be provided. The parties will use commercially reasonable efforts to memorialize these understandings at Closing in agreements,
reasonably acceptable to both parties, titled “Northern Border Transition Services Agreement” and “Northern Border Transition Services Supplemental Agreement”. Such agreements will follow the format of, and
encompass the concepts (including term and price of services) and types of transition services found in, the Transition Services Agreement and the Transition Services Supplemental Agreement. 
  

 31 

 (b) If the parties do not enter into the Northern Border Transition Services Agreement or the Northern
Border Transition Services Supplemental Agreement at Closing, then for a period ending six (6) months after the Closing Date (or upon the execution of such agreements, if earlier): (i) Purchaser will cause the Transfer Group Companies to provide
transition services to Enron on substantially the same basis as provided prior to Closing; (ii) Purchaser will provide, or cause the provision of, transition services to Seller on substantially the same basis as provided prior to Closing; (iii)
Seller will provide, or the cause the provision of, transition services to the Transfer Group Companies and/or the Northern Border Companies on substantially the same basis as provided prior to Closing; and (iv) Seller will request, and use
commercially reasonable efforts to have such request honored, that Enron provide any and all transition services to be performed for the Transfer Group Companies and/or the Northern Border Companies on substantially the same basis as provided prior
to Closing. 
  
 6.14 Purchaser Employee Benefit Plans.
Without in any way being obligated or bound by this Agreement to do so, and without any intent to create any third-party beneficiaries to this Agreement, Purchaser may provide for a Transfer Group Company employee’s employment with such
Transfer Group Company prior to the Closing Date to be deemed to be employment with the Purchaser or an Affiliate of the Purchaser for purposes of eligibility of benefits under any employee benefit plan of the Purchaser, to the extent the Purchaser
determines, in its sole discretion, that such deemed employment is appropriate and consistent with the transactions contemplated by this Agreement and such employee benefit plan of Purchaser.  
  
 6.15 Financial Information. 
  
 (a) To the extent received from the Enron Sellers, Seller shall provide to
Purchaser not later than forty (40) days following the end of each calendar quarter ending after the date hereof copies of the unaudited consolidated balance sheet of the Northern Plains Group Companies as at the end of such quarter and the related
statements of income, stockholders’ equity and cash flows of the Northern Plains Group Companies for the three (3) month period then ended. Seller shall also provide to Purchaser any other financial information that Seller receives from the
Enron Sellers under the Enron Purchase Agreement relating to the transactions contemplated hereunder. 
  
 (b) To the extent Purchaser reasonably requires audited or reviewed financial statements with respect to each of the Transfer Group Companies and the
Northern Border Companies in order to comply with the reporting requirements of the Securities and Exchange Commission set forth in Regulations S-K and S-X, Seller will request that the Enron Sellers reasonably cooperate with Purchaser (at
Purchaser’s cost), to deliver such financial statements including any reasonable request that the Enron Sellers: (i) request their independent auditors to prepare and deliver to Purchaser a comfort letter(s), customary in scope and substance
for comfort letters delivered in similar circumstances and (ii) request such members of management of the Transfer 

  

 32 

 
Group Companies and the Northern Border Companies that would customarily sign a management representation letter for the benefit of the independent auditors
in producing such comfort letter(s) to make themselves available. The failure of any independent auditor to provide the documentation referred to in the preceding clause (i) and the failure of any members of management to make themselves available
as provided in the preceding clause (ii) shall not constitute a default by Seller of its obligations hereunder. 
  
 ARTICLE VII 
  
 CONDITIONS TO CLOSING 
  
 7.1 Conditions Precedent to
Obligations of Each Party. The respective obligations of Seller, on the one hand, and Purchaser, on the other hand, to consummate the transactions contemplated by this Agreement are subject to the fulfillment, on or prior to the Closing Date, of
each of the following conditions: 
  
 (a) No Order issued by any
court of competent jurisdiction preventing the consummation of the transactions contemplated by this Agreement shall be in effect, nor shall any material proceeding initiated by any Governmental Authority of competent jurisdiction having valid
enforcement authority seeking such an Order be pending, nor shall there be any action taken, or any Law or Order enacted, entered or enforced that has not been subsequently overturned or otherwise made inapplicable to this Agreement, that makes the
consummation of the transactions contemplated by this Agreement illegal; 
  
 (b) Any waiting period (including any extension thereof) applicable to the purchase and sale of the Equity Interest to Purchaser under the HSR Act shall have terminated or expired and an Order of the FCC approving the
transactions contemplated by this Agreement shall have been obtained; 
  
 (c) Seller shall have obtained the consents and releases set forth on Schedule 7.1(c); and 
  
 (d) the Enron Closing shall have occurred. 
  
 7.2 Conditions Precedent to Obligations of Purchaser. The obligation of Purchaser to consummate the transactions contemplated by this Agreement is
subject to the fulfillment, on or prior to the Closing Date, of each of the following conditions (any or all of which may be waived by Purchaser, in whole or in part, subject to Applicable Law): 
  
 (a) All of the representations and warranties of Seller contained herein
shall be true and correct on and as of the Closing Date, except those representations and warranties of Seller that speak of a certain date, which representations and warranties shall have been true and correct as of such date; provided,
however, that this condition shall be deemed to have been satisfied so long as any failure of such representations and 

  

 33 

 
warranties to be true and correct, individually or in the aggregate, would not reasonably be expected to result in a Transfer Group Material Adverse Effect
or a Seller Material Adverse Effect; 
  
 (b) Seller shall have
performed and complied with its obligations and covenants required by this Agreement (other than Section 8.1(d) hereof) to be performed or complied with by Seller on or prior to the Closing Date, in all material respects; 
  
 (c) None of the Transfer Group Companies or the Northern Border Companies
shall have filed a petition for relief under the Bankruptcy Code or taken any other action specified in Section 6.2(b)(xii); and 
  
 (d) Purchaser shall have been furnished with the documents referred to in Section 8.1 (other than Section 8.1(d) hereof), including originally executed
versions of this Agreement and the Transaction Documents executed by all parties thereto other than Purchaser. 
  
 7.3 Conditions Precedent to Obligations of Seller. The obligations of Seller to consummate the transactions contemplated by this Agreement are
subject to the fulfillment, prior to or on the Closing Date, of each of the following conditions (any or all of which may be waived by Seller, in whole or in part, subject to Applicable Law): 
  
 (a) All of the representations and warranties of Purchaser contained herein
shall be true and correct on and as of the Closing Date, except those representations and warranties of Purchaser that speak of a certain date, which representations and warranties shall have been true and correct as of such date;
provided, however, that this condition shall be deemed to have been satisfied so long as any failure of such representations and warranties to be true and correct, individually or in the aggregate, would not reasonably be expected to
result in a Purchaser Material Adverse Effect; 
  
 (b) Purchaser
shall have performed and complied with all obligations and covenants required by this Agreement (other than Section 8.2(d) hereof) to be performed or complied with by Purchaser on or prior to the Closing Date, in all material respects; and

  
 (c) Seller shall have been furnished with the documents
referred to in Section 8.2 (other than Section 8.2(d) hereof), including originally executed versions of this Agreement and the Transaction Documents executed by all parties thereto other than Seller. 
  

 34 

 ARTICLE VIII 
  
 DOCUMENTS TO BE DELIVERED 
  
 8.1 Documents to Be Delivered by Seller. At the Closing, Seller shall deliver, or cause to be delivered, to Purchaser the following: 
  
 (a) stock certificates (or membership certificates (if available) in the
event that the Conversion Transactions, as defined in the Enron Purchase Agreement, are consummated) representing the Equity Interest, duly endorsed in blank or accompanied by transfer powers and with all requisite transfer tax stamps attached and
stock certificates or membership certificates (if available) representing ownership interests in the Transfer Group Companies; 
  
 (b) a certificate of an officer of Seller certifying that the closing conditions set forth in Section 7.2(a) (with respect to Seller’s
representations and warranties) and Section 7.2(b) (with respect to Seller’s obligations and covenants) have been satisfied; 
  
 (c) originally executed versions of this Agreement and the Transaction Documents executed by all parties thereto other than Purchaser; 
  
 (d) in accordance with Section 6.13, the Northern Border Transition Services
Agreement and the Northern Border Transition Services Supplemental Agreement executed by all parties thereto other than Purchaser; and 
  
 (e) a certified copy of the Approval Order, as defined in the Enron Purchase Agreement. 
  
 8.2 Documents to Be Delivered by Purchaser. At the Closing, Purchaser shall deliver to Seller the following:

  
 (a) evidence-of the wire transfer[s] referred to in Section
2.3 hereof; 
  
 (b) a certificate of an officer of Purchaser
certifying that the closing conditions set forth in Section 7.3(a) and Section 7.3(b) have been satisfied; 
  
 (c) originally executed versions of this Agreement and the Transaction Documents executed by all parties thereto other than Seller; and 
  
 (d) in accordance with Section 6.13, the Northern Border Transition Services
Agreement and the Northern Border Transition Services Supplemental Agreement executed by all parties thereto other than Seller. 
  

 35 

 ARTICLE IX 
  
 TAX AND ERISA MATTERS 
  
 9.1 Tax Sharing Agreements. Prior to Closing, pursuant to the Enron Purchase Agreement, Seller shall request, and use commercially reasonable
efforts to have such request honored, that any Tax sharing agreement between the Enron Sellers and any Transfer Group Company and all obligations or liabilities arising under any such agreements, shall be terminated immediately prior to the Closing
and shall have no further effect for any taxable year (whether the current year, a future year, or a past year). 
  
 9.2 Preparation of Tax Returns; Payment of Taxes. 
  
 (a) (i) Where required by Applicable Law, Seller shall, pursuant to the Enron Purchase Agreement, request, and use commercially reasonable efforts to have
each request honored, that the Transfer Group Companies be included in, and shall, pursuant to the Enron Purchase Agreement, request, and use commercially reasonable efforts to have such request honored, that the Enron Sellers file or cause to be
filed, (A) the United States consolidated federal income Tax Returns of Enron for all taxable periods of the Transfer Group Companies ending on or prior to the Closing Date; and (B) where applicable, all other consolidated, combined or unitary Tax
Returns of, or which include, one or more of the Transfer Group Companies for all taxable periods ending on or prior to the Closing Date. Seller shall, pursuant to the Enron Purchase Agreement, request, and use commercially reasonable efforts to
have such request honored, that the Enron Sellers remit (or cause to be remitted) all Taxes shown due with respect to the Tax Returns referred to in clauses (A) and (B) of this Section 9.2(a)(i). Within 100 days after the Closing Date (or sooner if
necessary to enable Seller to cause the timely filing of a Tax Return), Purchaser shall cause each of the Transfer Group Companies to prepare and provide to Seller a package of Tax information materials, including schedules and work papers (the
“Tax Package”) required by Seller to enable Seller to cause to be prepared and filed all Tax Returns (which have not been filed on or before the Closing Date) required to be prepared and filed pursuant to this Section 9.2(a)(i).

  
 (ii) Pursuant to the Enron Purchase
Agreement, Seller shall request, and use commercially reasonable efforts to have such request honored, that the Enron Sellers prepare and file, or cause to be prepared and filed, all Tax Returns of or which include any of the Transfer Group
Companies, other than Tax Returns described in Section 9.2(a)(i), that are required to be filed (after giving effect to any valid extension of time in which to make such filing) on or prior to the Closing Date. Pursuant to the Enron Purchase
Agreement, Seller shall request, and use commercially reasonable efforts to have such request honored, that the Enron Sellers cause the Transfer Group Companies to pay all Taxes shown due on Tax Returns described in this Section 9.2(a)(ii). If
Seller’s requests as described above in this Section 9.2(a)(ii) are not honored, then 

  

 36 

 
Seller shall cause the Enron Sellers to take such action as Purchaser may reasonably request, to the extent that Seller has the right to cause the Enron
Sellers to take such action under the Enron Purchase Agreement. 
  
 (iii) Purchaser shall prepare and file, or cause to be prepared and filed, on behalf of the Transfer Group Companies all other Tax Returns of, or which include, the Transfer Group Companies (other than those Tax
Returns described in Section 9.2(a)(i) and Section 9.2(a)(ii) above). Purchaser, or the Transfer Group Companies, shall remit (or cause to be remitted) all Taxes shown due on Tax Returns referred to in this Section 9.2(a)(iii). 
  
 (b) (i) All Tax Returns described in clauses (i), (ii) and (iii) of Section
9.2(a) (including the Tax Package) for taxable periods ending on or before or which include the Closing Date shall be prepared in a manner consistent with past practice unless a past practice has been finally determined to be incorrect by the
applicable Taxing Authority or a contrary treatment is required by applicable Tax Laws (or the judicial or administrative interpretations thereof). 
  
 (ii) Purchaser will provide Seller with copies of all Tax Returns described in clause (iii) of Section 9.2(a) at least thirty (30)
Business Days prior to the filing date; provided, however, that Purchaser shall have no obligation to furnish any Tax Returns referred to in Section 9.2(a)(iii) for which neither Seller nor any of the Enron Sellers have liability for
Taxes pursuant to clause (i) or (ii) of Section 9.10(a). Seller shall be provided an opportunity to review such returns and all supporting workpapers, schedules and information, and to propose changes, not later than five (5) Business Days prior to
the filing date of such Tax Returns. The failure of Seller to propose any changes to any such Tax Returns prior to the expiration of such five (5) Business Day period shall be deemed to be an indication of their approval thereof 
  
 (iii) Seller and Purchaser shall attempt in good faith
mutually to resolve any disagreements regarding Tax Returns described in Section 9.2(b)(ii) prior to the due date for filing thereof. Any disagreements regarding such Tax Returns which are not resolved prior to the filing thereof shall be promptly
resolved pursuant to Section 9.5. 
  
 (c) Allocating Taxable
Income: 
  
 (i) To the extent permitted by
Applicable Law or administrative practice of any Taxing Authority, (A) the taxable year of the Transfer Group Companies shall close as of the close of business on the Closing Date and (B) any transactions (other than the transactions contemplated by
this Agreement and the Enron Purchase Agreement) involving any of the Transfer Group Companies that are not in the Ordinary Course of Business occurring on 

  

 37 

 
the Closing Date but after the Closing shall be reported on Purchaser’s Tax Returns to the extent permitted by Applicable Law or on the post-Closing
separate company returns of the applicable Transfer Group Company (if the applicable Transfer Group Company does not file a Tax Return with Purchaser), and shall be similarly reported on all other Tax Returns of Purchaser or its Affiliates to the
extent permitted. Seller shall be responsible for all Taxes shown due on Tax Returns described in clause (A) of this Section 9.2(c) except to the extent such Tax is an Excluded Tax. Purchaser shall be responsible for all Taxes related to
transactions required to be reported on Tax Returns described in clause (B) of this Section 9.2(c) and for all Excluded Taxes. Seller, Purchaser and the Transfer Group Companies shall not take any position inconsistent with the provisions contained
in Section 9.2(c) on any Tax Return. 
  
 (ii) If
Applicable Law does not permit the Transfer Group Companies to close their taxable years as of the close of business on the Closing Date, or where Taxes are assessed with respect to a taxable period which includes the Closing Date but does not end
on that day (a “Straddle Period”), then Taxes, if any, attributable to the taxable period of the Transfer Group Companies beginning on or before and ending after the Closing Date shall be allocated (A) to Seller for the period up to
and including the Closing Date, except to the extent any such Taxes are Excluded Taxes and (B) to Purchaser with respect to all other Taxes attributable to the Straddle Period. For purposes of allocating Taxes attributable to a Straddle Period of
the Transfer Group Companies, (x) real, personal and intangible property Taxes and any other Taxes levied on a per diem basis (“Per Diem Taxes”) shall be equal to the amount of such Per Diem Taxes for the entire Straddle Period
multiplied by a fraction, the numerator of which is the number of days during the Straddle Period prior to and including the Closing Date and the denominator of which is the total number of days in the Straddle Period, and (y) the Taxes of the
Transfer Group Companies (other than Per Diem Taxes) for any taxable period ending on or prior to the Closing Date shall be computed as if such taxable period ended as of the close of business on the Closing Date. Any allocation of income or
deductions required to determine any Taxes attributable to any Straddle Period shall be made by means of a closing of the books and records of the Transfer Group Companies as of the close of business on the Closing Date; provided, that exemptions,
allowances or deductions that are calculated on an annual basis (including, but not limited to, depreciation and amortization deductions) shall be allocated between the period ending on the Closing Date and the period after the Closing Date in
proportion to the number of days in each such period. 
  
 (d)
Notwithstanding anything to the contrary herein, if Seller, on the one hand, or Purchaser, on the other hand, is responsible for all or a portion of the Taxes pursuant to Section 9.10 (after taking into account any applicable Tax Baskets) with

  

 38 

 
respect to a Tax Return (the “Paying Party”) that the other party is responsible for filing (or causing to be filed) pursuant to Section
9.2(a) (the “Preparing Party”), the Paying Party shall pay or cause to be paid the amount of such Taxes for which the Paying Party is responsible to the Preparing Party no later than five (5) days prior to the filing of the
underlying Tax Return. If a dispute arises (and is not resolved five (5) days prior to the filing of the Tax Return) between the Preparing Party and the Paying Party as to the Tax Return or the amount that the Paying Party owes to the Preparing
Party, the Paying Party shall pay or cause to be paid to the Preparing Party the amount that the Paying Party believes is owing to the Preparing Party, and Seller and Purchaser shall resolve their dispute in accordance with Section 9.5. Within five
(5) days following resolution of the dispute, the appropriate party shall pay or cause to be paid to the other party any amount determined to be due upon final resolution of the dispute. 
  
 (e) Purchaser agrees to furnish or cause to be furnished to Seller, and Seller agrees to use commercially reasonable efforts
to furnish or cause to be furnished to Purchaser, and each at their own expense, as promptly as practicable, such information (including access to books and records) and assistance, including making employees available on a mutually convenient basis
to provide additional information and explanations of any material provided, relating to the Transfer Group Companies as is reasonably necessary for the filing of any Tax Returns, for the preparation for any audit, and for the prosecution or defense
in any Tax Proceeding relating to any adjustment or proposed adjustment with respect to Taxes. Purchaser shall retain in its possession or cause the Transfer Group Companies to retain in their possession, and shall provide Seller (and the Enron
Sellers under the Enron Purchase Agreement) reasonable access to (including the right to make copies of), such supporting books and records and any other materials that Seller (or such Enron Sellers) may specify with respect to matters relating to
Taxes for any taxable period ending on or prior to or which includes the Closing Date until the relevant statute of limitations has expired. After such time, Purchaser may dispose of such material; provided, that prior to such disposition
Purchaser shall give Seller and the Enron Sellers a reasonable opportunity to take possession of such materials. 
  
 (f) Neither Purchaser nor any Affiliate or successor of Purchaser shall (or shall cause or permit any of the Transfer Group Companies to) amend, refile or
otherwise modify any Tax Return relating in whole or in part to any Transfer Group Company with respect to any taxable year or period ending on or before the Closing Date, or which includes the Closing Date, without the prior written consent of
Seller. 
  
 9.3 Certain Other Taxes. All transfer,
documentary, sales, use, stamp, registration and other such Taxes and fees (including any penalties and interest) incurred in connection with this Agreement, if any, shall be paid by Purchaser when due, and Purchaser shall file all necessary Tax
Returns and other documentation with respect to any such transfer, documentary, sales, use, stamp, registration and other Taxes and fees, and, if required by Applicable Law, Seller will, and will cause its Affiliates to, join in the execution of any
such Tax Returns and 
  

 39 

 
other documentation and will cooperate with Purchaser to take such commercially reasonable actions as will minimize or reduce the amount of such Taxes.

  
 9.4 Tax Audits. 
  
 (a) Seller and/or the Enron Sellers at the sole option of Seller, shall have
the sole right (but not the obligation) to represent the interests of the Transfer Group Companies in any audit or administrative or court proceeding (a “Tax Proceeding”) relating to Taxes for taxable periods of the Transfer Group
Companies which end on or before the Closing Date and to employ counsel of its choice at its expense, provided that Purchaser shall have the right to jointly represent the interests of the Transfer Group Companies with Seller (and/or the Enron
Sellers) in any such Tax Proceeding to the extent that Seller’s indemnification obligations have terminated pursuant to Section 9.10(d). Purchaser agrees that it will cooperate fully, and shall cause the Transfer Group Companies to cooperate
fully, with Seller (and/or the Enron Sellers under the Enron Purchase Agreement) and their counsel in the defense against or compromise of any claim in any said proceeding. 
  
 (b) Seller, and/or the Enron Sellers at the sole option of Seller, have the right, but not the obligation, to jointly
represent the interests of the Transfer Group Companies with the Purchaser in any Tax Proceeding relating to Taxes for any Straddle Period of the Transfer Group Companies. Any disputes regarding the conduct or resolution of any such audit or
proceeding shall be resolved pursuant to Section 9.5. 
  
 (c)
Purchaser shall have the sole right to represent the interests of the Transfer Group Companies in all Tax Proceedings other than Tax Proceedings described in clauses (a), (b) and (d) of this Section 9.4. 
  
 (d) Notwithstanding anything to the contrary herein, Seller shall not be
required to consult with Purchaser or seek Purchaser’s consent to settle any Tax Proceeding which relates to items reported on a Tax Return of the type described in Section 9.2(a)(i). 
  
 (e) If any Taxing Authority asserts a claim, makes an assessment or otherwise
disputes or affects any Taxes for which Seller and/or the Enron Sellers are responsible hereunder, Purchaser shall, promptly upon receipt by Purchaser and/or the Transfer Group Companies of notice thereof, inform Seller thereof. The failure of
Purchaser or the Transfer Group Companies to timely forward such notification in accordance with the immediately preceding sentence shall not relieve Seller of its obligation to pay such liability for Taxes except and to the extent that the failure
to timely forward such notification actually prejudices the ability of Seller (or the Enron Sellers under the Enron Purchase Agreement) to contest such liability for Taxes or increases the amount of such Taxes. 
  
 9.5 Dispute Resolution. In the event that Seller or Purchaser dispute
the application or interpretation of any provision of Sections 9.2, 9.4 and 9.9 hereof, or 
  

 40 

 
the amount or calculation of Taxes, if any, owed by such party thereunder, such party shall deliver to the other a statement setting forth, in reasonable
detail, the nature of and/or the dollar amount of any disagreement so asserted. The parties shall attempt in good faith to resolve such dispute within twenty (20) days following the commencement of such dispute. If the parties are unable to resolve
such dispute within such twenty (20) day period, the dispute shall be resolved by an Accounting Referee appointed in accordance with the procedures set forth in Schedule 2.1; provided, however, that in the event that an
Accounting Referee has been appointed under the Enron Purchase Agreement to resolve a bona fide dispute thereunder, such Accounting Referee shall serve as the Accounting Referee hereunder. The Accounting Referee shall determine, only with
respect to the specific disagreements submitted in writing by Seller and Purchaser, the manner in which such item or items in dispute should be resolved; provided, however, that the dollar amount of any such item or items shall be
determined within the range of dollar amounts proposed by Seller, on the one hand, and Purchaser, on the other hand. The Accounting Referee shall be directed to make such determination promptly, but in no event later than thirty (30) days after
acceptance of its appointment. Any finding by the Accounting Referee shall be a reasoned award stating the findings of fact and conclusions of law (if any) on which it is based, shall be final and binding upon the parties and shall be the sole and
exclusive remedy between the parties regarding the disputed items so presented. The fees and expenses of the Accounting Referee shall be shared by Seller and Purchaser (A) in proportion to each party’s respective liability for Taxes which are
the subject of the dispute as determined by the Accounting Referee or (B) in equal proportions if the subject of the dispute involves Tax Returns for which no Taxes are due. The parties shall otherwise bear their own expenses incurred in any dispute
resolution pursuant to this Section 9.5. 
  
 9.6 Refunds and
Tax Benefits. Any refunds of Taxes (together with any interest with respect thereto) paid to or in respect of the Transfer Group Companies (including any amounts credited against income tax to which Purchaser, its Affiliates or any of the
Transfer Group Companies becomes entitled) and that relate to Tax periods or portions thereof ending on or before the Closing Date shall be for the account of Seller. Purchaser shall pay over to Seller any such refund or the amount of any such
credit (in each case, together with any interest with respect thereto) within five (5) days after receipt or entitlement thereto. Any refunds or credits of Taxes (together with any interest with respect thereto) of the Transfer Group Companies for
any Straddle Period shall be equitably apportioned between Seller and Purchaser. Purchaser shall, if Seller so requests and at Seller’s expense, prepare, execute and file any claims for refunds or credits, or cause the Transfer Group Companies
to prepare, execute and file any claims for refunds or credits, to which Seller or the Enron Sellers is entitled under this Section 9.6. Purchaser shall permit Seller, and/or the Enron Sellers at the sole option of Seller, to control the prosecution
of any such refund. 
  
 9.7 Certain Elections. 

 
 (a) After the Closing Date, at Seller’s request, Purchaser shall
cause the Transfer Group Companies to make and/or join with Seller and/or the Enron Sellers 

  

 41 

 
in making any election after the Closing Date; provided, that the making of such election does not have an adverse impact on Purchaser (or any of the
Transfer Group Companies) for any post-acquisition Tax period. 
  
 (b) To the extent permitted by Law, Purchaser shall not permit the Transfer Group Companies to carry back any loss, deduction or credit to any taxable period that ends on, prior to or which includes the Closing Date. 
  
 9.8 FIRPTA. Seller shall furnish to Purchaser on or before the Closing
Date a certification of its non-foreign status consistent with the requirements set forth in Section 1445 of the Code and the Treasury Regulations. 
  
 9.9 Intentionally Omitted. 
  
 9.10 Tax Indemnification. 
  
 (a) Seller hereby agrees to indemnify and hold Purchaser Indemnified Parties harmless (without duplication) from and against any and all Covered Taxes
that (x) are imposed upon or assessed against the Transfer Group Companies or the assets or the properties thereof and (y) are not barred from recovery under the applicable statute of limitations. For purposes of this Section 9.10(a),
“Covered Taxes” shall mean (without duplication): 
  
 (i) Taxes of Seller or any Affiliate (other than a Transfer Group Company) with which Seller or such Affiliate files a consolidated, combined or similar Tax Return imposed upon any of the Transfer Group Companies by
reason of any of the Transfer Group Companies being severally liable for any Taxes of any other Person pursuant to Section 1.1502-6(a) of the Treasury Regulations or any analogous provisions of state, local or foreign law; 
  
 (ii) Taxes for which a Transfer Group Company is liable with
respect to all taxable periods ending on or prior to the Closing Date (including, without limitation, such Taxes imposed upon such Transfer Group Companies by reason of the Transfer Group Companies being severally liable for any Taxes of any other
Person pursuant to Section 1.1502-6(a) of the Treasury Regulations or any analogous provisions of state, local or foreign law or arising under the principles of successor or transferee liability); and 
  
 (iii) Taxes of the Transfer Group Companies for the period
allocated to Seller pursuant to Section 9.2(c). 
  
 provided,
however, Covered Taxes shall not include (and, for avoidance of doubt, Seller shall not be liable for and shall not indemnify or hold harmless Purchaser Indemnified Parties from or against) any Excluded Taxes. Notwithstanding the foregoing,
Seller shall not be required to indemnify the Purchaser Indemnified Parties pursuant to Section 9.10(a)(ii) or (iii) for Taxes described in Section 9.10(a)(ii) or (iii) for which any Northern Plains Group Company is liable until such Taxes exceed
$1.8 million (the “NP 

  

 42 

 
Tax Basket”), and then Seller shall only be required to indemnify Purchaser Indemnified Parties for any such Taxes in excess of the NP Tax
Basket.  
  
 (b) Purchaser hereby agrees to indemnify and
hold harmless Seller Indemnified Parties from and against (i) any and all Taxes of the Transfer Group Companies with respect to any taxable period of the Transfer Group Companies beginning after the Closing Date (including any portion of such Taxes
allocable to Purchaser pursuant to Section 9.2(c)) and (ii) any and all Excluded Taxes. 
  
 (c) Without duplication, Seller shall indemnify and hold harmless Purchaser Indemnified Parties from and against any and all Losses (i) incurred in connection with the Taxes for which Seller is responsible to
indemnify Purchaser Indemnified Parties pursuant to Section 9.10(a) or the enforcement of Section 9.10(a) and this Section 9.10(c) and/or (ii) incurred as a result of a breach by Seller of any covenant contained in this Article IX. Without
duplication, Purchaser shall indemnify and hold harmless Seller Indemnified Parties from and against any and all Losses (i) incurred in connection with the Taxes for which Purchaser is responsible to indemnify Seller Indemnified Parties pursuant to
Section 9.10(b) or the enforcement of Section 9.10(b) and this Section 9.10(c) and/or (ii) incurred as a result of a breach by Purchaser of any of the covenants contained in this Article IX. 
  
 (d) Notwithstanding anything contained herein to the contrary, Seller’s
obligation to indemnify Purchaser Indemnified Parties for any Taxes and Losses pursuant to this Section 9.10 shall terminate upon the earlier of (i) the expiration of the applicable statute of limitations with respect to the underlying Tax and (ii)
the closing of the Enron Bankruptcy Cases. 
  
 9.11 Employee
Benefits Indemnification. Seller hereby agrees to indemnify and hold the Purchaser Indemnified Parties harmless from and against any and all Losses that are imposed upon or assessed against a Transfer Group Company or the assets thereof (i)
arising under Title IV of ERISA and relating to the Cash Balance Plan, the EFS Pension Plan, the San Juan Gas Pension Plan, the Garden State Paper Pension Plan, the Portland General Electric Company Pension Plan or any “employee pension benefit
plan” within the meaning of Section 3(2) of ERISA sponsored by the Enron Sellers or their ERISA Affiliates, (ii) due to “participating employer” or “participating company” status in the Enron Corp. Savings
Plan, the Enron Corp. Employee Stock Ownership Plan, or the Cash Balance Plan or due to the participation of the Transfer Group Company employees or former employees in such plans (other than claims that, after the Closing Date, any Transfer Group
Company failed to make normal and customary contributions required under the express terms of the foregoing plans, other than the Cash Balance Plan); or (iii) relating to any group health or insurance plans sponsored or maintained by the Enron
Sellers or any of their ERISA Affiliates other than any Transfer Group Company with respect to any termination of any such plans arising under Section 4980B of the Code; provided, that such Losses are not barred from recovery from any of the
Transfer Group Companies under the relevant statute of 

  

 43 

 
limitations; and provided, further, except with respect to the Cash Balance Plan (as provided in Section 6.12(c)), that the indemnity set forth in this
Section 9.11 shall not affect the obligation of the Transfer Group Companies to make payments pursuant to any Order of the Bankruptcy Court, the Contribution Agreement, the Transition Services Agreement or any other agreement, including without
limitation, the agreement set forth in Section 5.6(b) of the Contribution Agreement, between any of the Enron Sellers, on one hand, and the Transfer Group Companies, on the other hand, relating to the allocation of costs of providing employee
benefits to the employees of the Transfer Group Companies. 
  
 9.12 Coordination of Provisions. In the case of any inconsistency between Articles IX and X, Article IX shall control with respect to Tax and employee benefits provided, that Sections 10.2(b), 10.2(c), 10.2(f), 10.2(g), 10.3(b),
10.3(c), 10.3(f), 10.4, 10.5 and 10.6 shall apply to Article IX; provided, further, that, with respect to any Tax matters, in the case of any conflict between Sections 9.4 or 9.5 on the one hand and Section 10.4 on the other hand,
Sections 9.4 and 9.5 shall control. 
  
 ARTICLE X 
  
 INDEMNIFICATION 
  
 10.1 Survival of Representations, Warranties, Covenants and Agreements. 
  
 Subject to the limitations and other provisions of this Agreement: 
  
 (a) The representations and warranties of Seller and Purchaser contained in
this Agreement, and the covenants and agreements of Seller and Purchaser contained in this Agreement which by their terms are required to be performed on or before the Closing (the “Pre-Closing Covenants”), shall survive the Closing
and shall remain in full force and effect until the later of (i) June 25, 2005 and (ii) the date that is 175 days after the Closing Date; provided, however, that the representations and warranties contained in Section 4.14 shall not
survive the Closing (it being agreed that all indemnification for Tax matters shall be governed solely by Article IX, except to the extent otherwise provided in Section 9.12). 
  
 (b) Each covenant and agreement of Seller and Purchaser contained in this Agreement which by its terms requires performance
after the Closing Date (a “Post-Closing Covenant”) shall survive the Closing and shall remain in full force and effect until such covenant or agreement is fully performed. 
  
 10.2 Seller Indemnification. 
  
 (a) Subject to the provisions of this Article X, and except as otherwise
provided in Article IX, from and after the Closing Date, Seller agrees to indemnify the 

  

 44 

 
Purchaser Indemnified Parties against and hold them harmless from any and all Losses actually suffered or incurred by them arising out of the following:

  
 (i) the breach of any representation or
warranty of Seller contained in this Agreement; provided, however, that in determining whether Seller is liable pursuant to this Section 10.2(a)(i) for any breach of any representation or warranty contained in Section 4.7 of this
Agreement, the qualification of any such representation or warranty by reference to materiality, including any reference to the qualification “Seller Material Adverse Effect” or “Transfer Group Material Adverse
Effect” shall be disregarded and the determination of whether any such representation or warranty has been breached shall be made without regard to any such qualification or whether such breach is material or constitutes a Seller Material
Adverse Effect or Transfer Group Material Adverse Effect. Notwithstanding the foregoing, for the purposes of this Section 10.2(a)(i), no representation or warranty in Section 4.7 containing a qualification by reference to materiality, including any
reference to “Seller Material Adverse Effect” or “Transfer Group Material Adverse Effect,” shall be considered to have been breached unless the Losses to the Purchaser Indemnified Parties resulting from such breach
exceed $500,000 (the “Individual Basket Amount”) per individual breach (or series of related breaches arising out of the same event) of such representation or warranty; provided, that, once such Losses for such individual
breach (or series of related breaches arising out of the same event) of such representation or warranty equal or exceed the Individual Basket Amount, subject to the other limitations in this Article X (including, without limitation, satisfaction of
the Basket Amount set forth in Section 10.2(d)), Seller shall be liable to the Purchaser Indemnified Parties for the entire amount of such Losses in excess of the Basket Amount (for the avoidance of doubt, each individual breach, or series of
related breaches arising out of the same event, of a representation or warranty shall be separately applied towards the Individual Basket Amount and such individual breaches, or series of related breaches arising out of the same event, shall not be
aggregated with other breaches for purposes of determining whether the Individual Basket Amount has been reached); 
  
 (ii) the breach of any Pre-Closing Covenant by Seller; or 
  
 (iii) the breach of any Post-Closing Covenant by Seller; 
  
 (b) Seller shall not be required to indemnify any Purchaser Indemnified Party
pursuant to this Section 10.2 or Sections 9.10 or 9.11 to the extent otherwise indemnifiable Losses or claims pursuant to this Section 10.2 or Sections 9.10 or 9.11 (i) resulted from fraud, gross negligence, bad faith or willful misconduct of
Purchaser or (ii) have resulted in a reduction in the Purchase Price pursuant to the purchase price adjustment provisions in this Agreement. 
  

 45 

 (c) No claim may be asserted nor may any action be commenced against Seller pursuant to this Section
10.2(a) or Sections 9.10 or 9.11 for breach of any representation or warranty, Pre-Closing Covenant or Post-Closing Covenant or a claim pursuant to Sections 9.10 or 9.11, unless written notice of such claim or action (satisfying the requirements of
Section 10.4) is received by Seller on or prior to the date on which the representation or warranty, Pre-Closing Covenant or Post-Closing Covenant on which such claim or action, or claim pursuant to Sections 9.10 or 9.11, is based ceases to survive
as set forth in, as applicable, Sections 9.10, 9.11 or 10.1. 
  
 (d) No claim may be made against Seller for indemnification pursuant to Sections 10.2(a)(i) and 10.2(a)(ii) unless the aggregate amount of all Losses of the Purchaser Indemnified Parties upon which valid claims are based pursuant to such
sections shall exceed an amount equal to $1,000,000 (the “Basket Amount”), and then Seller shall only be responsible for indemnification of Losses in excess of the Basket Amount. 
  
 (e) The amounts paid by Seller for indemnification of Losses under this
Agreement pursuant to Sections 10.2(a)(i) and 10.2(a)(ii) shall be limited to, in the aggregate, an amount equal to $3,500,000 (the “Indemnification Cap”). 
  
 (f) No claim may be asserted nor may any action be commenced against Seller pursuant to this Section 10.2 or Sections 9.10
or 9.11 for breach of any representation or warranty, Pre-Closing Covenant or Post-Closing Covenant or claim pursuant to Sections 9.10 or 9.11 to the extent that (i) Purchaser had a reasonable opportunity, but failed, in good faith to mitigate the
Loss including, but not limited to, the failure to use commercially reasonable efforts to recover under a policy of insurance or under a contractual right of set-off or indemnity, or (ii) such Loss arises from or was caused by actions taken or
failed to be taken by Purchaser or any of its Affiliates after the Closing. 
  
 (g) Notwithstanding anything to the contrary contained herein or in any Transaction Document, the amounts paid by Seller for indemnification under this Agreement and the Transaction Documents shall in no event exceed,
in the aggregate, the Purchase Price. 
  
 10.3 Purchaser
Indemnification. 
  
 (a) Subject to the provisions of this
Article X, and except as otherwise provided in Article IX, Purchaser agrees from and after the Closing Date to indemnify the Seller Indemnified Parties against and hold them harmless from any and all Losses actually suffered or incurred by them
arising out of: 
  
 (i) the breach of any
representation or warranty of Purchaser contained in this Agreement; 
  
 (ii) the breach of any Pre-Closing Covenant by Purchaser; or 
  

 46 

 (iii) the breach of any Post-Closing Covenant by Purchaser. 
  
 (b) Purchaser shall not be required to indemnify any Seller Indemnified Party
pursuant to this Section 10.3 or Section 9.10 to the extent any such Losses or claims pursuant to Section 9.10 resulted from fraud, gross negligence, bad faith or willful misconduct of Seller. 
  
 (c) No claim may be asserted nor may any action be commenced against
Purchaser pursuant to clause (i) or (ii) of Section 10.3(a) or Section 9.10 for breach of any representation or warranty, Pre-Closing Covenant or Post-Closing Covenant or claim pursuant to Section 9.10, unless written notice of such claim or action
(satisfying the requirements of Section 10.4) is received by Purchaser on or prior to the date on which the representation or warranty, Pre-Closing Covenant or Post-Closing Covenant on which such claim or action, or claims pursuant to Section 9.10,
is based ceases to survive as set forth in, as applicable, Section 9.10 or 10.1. 
  
 (d) No claim may be made against Purchaser for indemnification pursuant to Sections 10.3(a)(i) and 10.3(a)(ii) (except with respect to indemnification for breaches of Section 6.1 unless the aggregate amount of all
Losses of the Seller Indemnified Parties upon which valid claims are based pursuant to such sections shall exceed an amount equal to the Basket Amount, and then Purchaser shall only be responsible for indemnification of Losses in excess of the
Basket Amount. 
  
 (e) The amounts paid by Purchaser for
indemnification of Losses under this Agreement pursuant to Sections 10.3(a)(i) and l0.3(a)(ii) (except with respect to indemnification for breaches of Section 6.1) shall be limited to, in the aggregate, an amount equal to the Indemnification Cap.

  
 (f) The amounts paid by Purchaser for indemnification of
Losses under this Agreement and the Transaction Documents shall in no event exceed, in the aggregate, the Purchase Price. 
  
 10.4 Procedures. 
  
 (a) A Purchaser Indemnified Party or a Seller Indemnified Party, as the case may be (for purposes of this Section 10.4, an “Indemnified
Party”), shall give the indemnifying party under Sections 9.10, 9.11, 10.2 or 10.3, as applicable (for purposes of this Section 10.4, an “Indemnifying Party”), prompt written notice of any matter which it has in good faith
determined has given rise to a right of indemnification under this Agreement (the “Indemnity Notice”), stating the amount of the Loss, if known, and method of computation thereof, if practicable, and containing a reference to
the provisions of this Agreement in respect of which such right of indemnification is claimed or arises; provided that the Indemnified Party’s failure to provide timely notice as provided herein shall not reduce the indemnification obligations
of the Indemnifying Party except to the extent that the Indemnifying Party is materially harmed by such 

  

 47 

 
failure to provide notice. If an Indemnifying Party notifies an Indemnified Party within the Dispute Period that it disputes its liability with respect to
the claim described in the Indemnity Notice, an Indemnifying Party and an Indemnified Party shall proceed in good faith to negotiate a resolution of such dispute, and if not resolved through negotiations within the Resolution Period, such dispute
shall be resolved in accordance with the provisions of Section 12.3. 
  
 (b) An Indemnified Party shall also give prompt written notice of any pending claim or demand by a third party (the “Third Party Claim Notice”) to the Indemnifying Party that the Indemnified Party has in good faith
determined will likely give rise to a right of indemnification under this Agreement (a “Third Party Claim”), describing in reasonable detail the facts and circumstances with respect to the subject matter of such claim or demand. If
an Indemnified Party fails to provide the Third Party Claim Notice with reasonable promptness after an Indemnified Party receives notice of such Third Party Claim, an Indemnifying Party shall still be obligated to indemnify an Indemnified Party with
respect to such Third Party Claim, except to the extent that an Indemnifying Party’s ability to defend the relevant claim has been materially prejudiced by such failure of an Indemnified Party. The Indemnifying Party shall have the right, at
its sole option and expense, to be represented by counsel of its choice and to defend against, negotiate, settle or otherwise deal with any Third Party Claim which relates to any Losses indemnified against hereunder. If the Indemnifying Party elects
to defend against, negotiate, settle or otherwise deal with any Third Party Claim which relates to any Losses indemnified against hereunder, it shall within the Dispute Period, or if there is a dispute, then within the Resolution Period, notify the
Indemnified Party of its intent to do so. If the Indemnifying Party elects not to defend against, negotiate, settle or otherwise deal with any Third Party Claim which relates to any Losses indemnified against hereunder, the Indemnified Party may
defend against, negotiate, settle or otherwise deal with such Third Party Claim. If the Indemnifying Party shall assume the defense of any Third Party Claim, the Indemnified Party may participate in, at his or its own expense, but not control, the
defense of such Third Party Claim; provided, however, that such Indemnified Party shall be entitled to participate in any such defense with separate counsel at the expense of the Indemnifying Party if (i) so requested by the
Indemnifying Party to participate or (ii) in the reasonable opinion of counsel to the Indemnified Party, a conflict or potential conflict exists between the Indemnified Party and the Indemnifying Party that would make such separate representation
advisable; provided, further, that the Indemnifying Party shall not be required to pay for more than one such counsel for all Indemnified Parties in connection with any Third Party Claim. The parties hereto agree to cooperate fully
with each other in connection with the defense, negotiation or settlement of any such Third Party Claim. Notwithstanding anything in this Section 10.4 to the contrary, neither the Indemnifying Party nor the Indemnified Party shall, without the
written consent of the other party, which consent shall not be unreasonably withheld, delayed or conditioned, settle or compromise any Third Party Claim or permit a default judgment or consent to entry of any judgment unless the claimant and such
party provide to such other party an unqualified release from all liability in respect of the Third Party Claim. Notwithstanding the foregoing, if a 

  

 48 

 
settlement offer solely for money damages is made by the applicable third party claimant, and the Indemnifying Party notifies the Indemnified Party in
writing of the Indemnifying Party’s willingness to accept the settlement offer and, subject to the applicable limitations of Sections 9.10, 9.11, 10.2 and 10.3, pay the amount called for by such offer, and the Indemnified Party declines to
accept such offer, the Indemnified Party may, at its own expense, continue to contest such Third Party Claim, free of any participation by the Indemnifying Party, and the amount of any ultimate liability with respect to such Third Party Claim that
the Indemnifying Party has an obligation to pay hereunder shall, subject to the Indemnification Cap and other limits set forth in Sections 9.10, 9.11, 10.2 and 10.3, be limited to the lesser of (A) the amount of the settlement offer that the
Indemnified Party declined to accept or (B) the aggregate Losses of the Indemnified Party with respect to such Third Party Claim, subject, in each case, to the limitations set forth in Sections 9.10, 9.11, 10.2 and 10.3. If the Indemnifying Party
makes any payment on any Third Party Claim or other claim hereunder, the Indemnifying Party shall be subrogated, to the extent of such payment, to all rights and remedies of the Indemnified Party to any insurance benefits or other claims of the
Indemnified Party with respect to such Third Party Claim or other claim hereunder. 
  
 (c) After any final decision, judgment or award shall have been rendered in accordance with Section 12.3 and the expiration of the time in which to appeal therefrom, or a settlement shall have been consummated, or the
Indemnified Party and the Indemnifying Party shall have arrived at a mutually binding agreement with respect to a Third Party Claim or other claim hereunder, the Indemnified Party shall forward to the Indemnifying Party notice of any sums due and
owing by the Indemnifying Party pursuant to this Agreement with respect to such matter. 
  
 10.5 Tax Treatment of Indemnity Payments. To the extent permitted by Applicable Law, Seller and Purchaser agree to treat any indemnity payment made pursuant to Article IX or this Article X as an adjustment to
the Purchase Price for federal, state, local and foreign income Tax purposes. 
  
 10.6 Remedies. From and after the Closing, the provisions of Article IX, this Article X and Sections 6.1, and 6.5 shall be the sole and exclusive remedy of each party hereto for any breach of the other
party’s representations or warranties, covenants or agreements contained in this Agreement, including any breach of the other party’s Pre-Closing Covenants or Post-Closing Covenants. 
  

 49 

 ARTICLE XI 
  
 DEFINITIONS 
  
 11.1 Certain Definitions. For purposes of this Agreement, the following terms shall have the meanings specified in this Section 11.1: 

 
 “Accounting Referee” shall have the meaning set forth on
Schedule 2.1. 
  
 “Action” means any
action, suit, arbitration, claim, inquiry, proceeding or investigation by or before any Governmental Authority of any nature, civil, criminal, regulatory or otherwise, in law or in equity. 
  
 “Affiliate” (and, with a correlative meaning
“affiliated”) means, with respect to any Person, any direct or indirect subsidiary of such Person, and any other Person that directly, or through one or more intermediaries, controls or is controlled by or is under common control
with such first Person. As used in this definition, “control” (including with correlative meanings, “controlled by” and “under common control with”) means possession, directly or indirectly, of
power to direct or cause the direction of management or policies (whether through ownership of securities or partnership or other ownership interests, by Contract or otherwise). 
  
 “Affiliate Contracts” shall have the meaning set forth in Section 4.11(b). 
  
 “Agreement” shall have the meaning set forth in the recitals
hereto. 
  
 “Applicable Law” means, with respect
to any Person, any Law applicable to such Person or its business, properties or assets. 
  
 “Balance Sheet Date” shall have the meaning set forth in Section 4.6(a). 
  
 “Balance Sheets” shall have the meaning set forth in Section 4.6(a). 
  
 “Bankruptcy Code” means title 11 of the United State Code, as amended. 
  
 “Bankruptcy Court” means the United States Bankruptcy Court
for the Southern District of New York or any other court having jurisdiction over the Enron Bankruptcy Cases from time to time. 
  
 “Basket Amount” shall have the meaning set forth in Section 10.2(d). 
  
 “Benefit Arrangement” shall have the meaning set forth in Section 4.13(b). 
  
 “Business Day” means a day other than a Saturday, Sunday or
other day on which commercial banks in New York City are authorized or required by Law to close. Any event the scheduled occurrence of which would fall on a day that is not a Business Day shall be deferred until the next succeeding Business Day.

  
 “Cash Balance Plan” shall have the meaning
set forth in Section 4.13(h). 
  
 “Cash Deposit”
shall have the meaning set forth in Section 2.2(a). 
  

 50 

 “Closing” shall have the meaning set forth in Section 3.1. 
  
 “Closing Date” shall have the meaning set forth in Section
3.1. 
  
 “Code” shall mean the Internal Revenue
Code of 1986, as amended. 
  
 “Communications
Act” means the Communications Act of 1934, as amended, and the rules and regulations promulgated thereunder. 
  
 “Confidentiality Agreement” shall have the meaning set forth in Section 6.5(a). 
  
 “Contract” means any written contract, indenture, note,
bond, loan, instrument, lease, commitment or other agreement. 
  
 “Contribution Agreement” means the Amended and Restated Contribution and Separation Agreement, dated as of March 31, 2004, among Enron, CrossCountry, CrossCountry Citrus Corp. and CrossCountry Energy Corp. 
  
 “Covered Taxes” shall have the meaning set forth in Section
9.10(a). 
  
 “CrossCountry” shall have the
meaning set forth in the recitals. 
  
 “Deposit
Amount” shall have the meaning set forth in Section 2.2(a). 
  
 “Deposit Escrow Agent” shall have the meaning set forth in Section 2.2(a). 
  
 “Deposit Escrow Agreement” shall have the meaning set forth in Section 2.2(a). 
  
 “Dispute Period” shall mean the period ending twenty (20)
days following receipt by an Indemnifying Party of either a Third Party Claim Notice or an Indemnity Notice. 
  
 “Disputed Item” shall have the meaning set forth on Schedule 2.1. 
  
 “DOJ” shall have the meaning set forth in Section 6.3(b). 
  
 “Employee Benefit Plans” shall have the meaning set forth in
Section 4.13(a). 
  
 “Enron” means Enron Corp.,
an Oregon corporation. 
  

 51 

 “Enron Bankruptcy Cases” means the chapter 11 cases commenced by Enron and certain of
its direct and indirect subsidiaries on or after December 2, 2001 (including any case commenced after the date of the Enron Purchase Agreement), jointly administered under Case No. 01-16034-(AJG). 
  
 “Enron Purchase Agreement” shall have the meaning set forth
in the recitals. 
  
 “Enron Sellers” shall have
the meaning set forth in the recitals. 
  
 “Environmental
Law” means all Applicable Laws in effect on the date of this Agreement relating to the environment, natural resources or the protection thereof, including but not limited to any applicable provisions of the Comprehensive Environmental
Response, Compensation and Liability Act, 42 U.S.C. § 9601 et seq., the Hazardous Materials Transportation Act, 49 U.S.C. § 5101 et seq., the Resource Conservation and Recovery Act, 42 U.S.C. § 6901 et seq., the
Clean Water Act, 33 U.S.C. § 1251 et seq., the Clean Air Act, 42 U.S.C. § 7401 et seq., the Toxic Substances Control Act, 15 U.S.C. § 2601 et seq., the Federal Insecticide, Fungicide, and Rodenticide Act, 7 U.S.C.
§ 136 et seq., and the Oil Pollution Act of 1990, 33 U.S.C. §2701 et seq., and the regulations promulgated pursuant thereto, and all analogous state or local statutes. 
  
 “Equity Interest” shall have the meaning set forth in the
recitals hereto. 
  
 “ERISA” shall have the
meaning set forth in Section 4.13(a). 
  
 “ERISA
Affiliate” means, with respect to any entity, any trades or businesses (whether or not incorporated) that are under control of, or that are treated as a single employer with, such entity under Sections 414(b), (c), (m) or (o) of the Code or
Sections 400l(a)(14)(A) or (B) of ERISA. 
  
 “Estimated
Closing Statement” shall have the meaning set forth on Schedule 2.1. 
  
 “Estimated Purchase Price Adjustment” shall have the meaning set forth on Schedule 2.1. 
  
 “Exchange Act” shall have the meaning set forth in Section 4.6(b). 
  
 “Excluded Taxes” means (i) any liability for Taxes resulting from transactions or actions (other than the
transactions contemplated by this Agreement) out of the ordinary course of business taken by Purchaser or any Affiliate (including the Transfer Group Companies) or any transferee of Purchaser or any of its Affiliates on the Closing Date but after
the Closing; (ii) any interest or penalties attributable to the 

  

 52 

 
untimely filing of a Tax Return described in Section 9.2(a)(iii); (iii) any liability for Taxes that are taken into account in determining the Final
Purchase Price Adjustment in accordance with Schedule 2.1; and (iv) any liability for Taxes described in Section 9.3. 
  
 “FCC” means the Federal Communications Commission. 
  
 “FERC” means the Federal Energy Regulatory Commission. 
  
 “Final Closing Statement” shall have the meaning set forth
on Schedule 2.1. 
  
 “Final Northern Capital
Contribution Amount” shall have the meaning set forth on Schedule 2.1. 
  
 “Final Purchase Price Adjustment” shall have the meaning set forth on Schedule 2.1. 
  
 “Financial Statements” shall have the meaning set forth in Section 4.6(a). 
  
 “FTC” shall have the meaning set forth in Section 6.3(b). 
  
 “GAAP” means United States generally accepted accounting
principles as in effect during the time period of the relevant financial statement. 
  
 “Governmental Authority” means any entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to United States federal, state or local government,
including any governmental authority, agency, department, board, commission or instrumentality or any political subdivision thereof, and any tribunal, court or arbitrator(s) of competent jurisdiction. 
  
 “Guaranteed Indebtedness” shall have the meaning set forth
in Section 6.11. 
  
 “HSR Act” means the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the rules and regulations promulgated thereunder. 
  
 “Indemnification Cap” shall have the meaning set forth in Section 10.2(e). 
  
 “Indemnified Party” shall have the meaning set forth in Section 10.4(a). 
  
 “Indemnifying Party” shall have the meaning set forth
in Section 10.4(a). 
  
 “Indemnity Notice” shall
have the meaning set forth in Section 10.4(a). 
  

 53 

 “Individual Basket Amount” shall have the meaning set forth in Section 10.2(a).

  
 “IRS” means the United States Internal
Revenue Service. 
  
 “Law” means any federal,
state or local law (including common law), statute, code, ordinance, rule, regulation or other requirement enacted, promulgated, issued or entered by a Governmental Authority. 
  
 “Leased Real Property” shall have the meaning set forth in Section 4.9(b). 
  
 “Letters of Credit” shall have the meaning set forth in
Section 2.2(a). 
  
 “Lien” means any lien,
pledge, mortgage, deed of trust, security interest, claim, lease, charge, option, right of first refusal, easement, servitude, transfer restriction under any shareholder or similar agreement or encumbrance. 
  
 “Losses” means any and all liabilities, losses, damages,
claims, reasonable and documented out-of-pocket costs and expenses (including reasonable attorneys’, accountants’ or other fees and expenses incurred in defending any Action or in investigating any of the same or in asserting any rights
hereunder) actually suffered or incurred by a Person, but not including consequential, exemplary, special and punitive damages and lost profits. 
  
 “Material Contracts” shall have the meaning set forth in Section 4.11(a). 
  
 “NBI” shall have the meaning set forth in Section 4.5(d). 
  
 “NBP Services” shall have the meaning set forth in the
recitals hereto. 
  
 “Northern Border” shall have
the meaning set forth in Section 4.5(d). 
  
 “Northern
Border Companies” means Northern Border, NBI, Northern Border Pipeline Company, a Texas general partnership, Crestone Energy Ventures, L.L.C., a Delaware limited liability company, Bear Paw Investments, LLC, a Delaware limited liability
company, Bear Paw Energy, LLC, a Delaware limited liability company, Border Midwestern Company, a Delaware corporation, Midwestern Gas Transmission Company, a Delaware corporation, Border Viking Company, a Delaware corporation, and Viking Gas
Transmission Company, a Delaware corporation. 
  
 “Northern Border Distribution” shall have the meaning set forth in Section 6.10. 
  
 “Northern Border Partnership Agreement” means the Amended and Restated Agreement of Limited Partnership of Northern Border Partners,
L.P., dated as of 

  

 54 

 
October 1, 1993, by and among NBI, Pan Border Gas Company and Northwest Border Pipeline Company. 
  
 “Northern Border Transition Services Agreement” shall have
the meaning set forth in Section 6.13. 
  
 “Northern
Border Transition Services Supplemental Agreement” shall have the meaning set forth in Section 6.13. 
  
 “Northern Border SEC Reports” shall have the meaning set forth in Section 4.6(b). 
  
 “Northern Capital Contribution” shall have the meaning set
forth on Schedule 2.1. 
  
 “Northern Capital
Contribution Amount” shall have the meaning set forth on Schedule 2.1. 
  
 “Northern Plains” shall have the meaning set forth in the recitals hereto. 
  
 “Northern Plains Group Companies” means Northern Plains, Pan Border Gas Company, Northern Border Pipeline Corporation and any of their
respective subsidiaries, and any successors thereof formed pursuant to the Conversion Transactions in accordance with Section 6.16 of the Enron Purchase Agreement. For the avoidance of doubt, any reference to the term “Northern Plains Group
Companies” shall include only the entities specified in the previous sentence and shall not be construed to cover the conduct or operations of the Northern Border Companies or Persons in which the Northern Border Companies hold a minority
interest. 
  
 “NP Tax Basket” shall have the
meaning set forth in Section 9.10(a). 
  
 “Objection” shall have the meaning set forth on Schedule 2.1. 
  
 “Objection Date” shall have the meaning set forth on Schedule 2.1. 
  
 “Objection Period” shall have the meaning set forth on Schedule 2.1. 
  
 “Order” means any order, injunction, judgment, decree, ruling, writ, assessment or arbitration award.

  
 “Ordinary Course of Business” shall
refer to the conduct of business of the Transfer Group Companies from and after December 2, 2001. 
  
 “Outside Date” shall have the meaning set forth in Section 3.2(b). 
  

 55 

 “Paying Party” shall have the meaning set forth in Section 9.2(d). 
  
 “PBGC” means the Pension Benefit Guaranty Corporation.

  
 “Per Diem Taxes” shall have the meaning set
forth in Section 9.2(c)(ii). 
  
 “Permits” means
any approvals, authorizations, consents, licenses, permits or certificates. 
  
 “Permitted Exceptions” means (i) all Liens and exceptions disclosed in policies of title insurance set forth on Schedule 4.9; (ii) statutory Liens for current Taxes, assessments or other
governmental charges not yet delinquent or the amount or validity of which is being contested in good faith by appropriate proceedings; (iii) mechanics’, carriers’, workers’, repairers’ and similar Liens; (iv) zoning, entitlement
and other land use and environmental regulations by any Governmental Authority; (v) with respect to any asset, right or interest, Liens that would be released pursuant to the Approval Order (as such term is defined in the Enron Purchase Agreement)
from such asset, right or interest and attach to the sales proceeds received by the Enron Sellers under the Enron Purchase Agreement upon the closing of the transactions contemplated by the Enron Purchase Agreement, and (vi) such other Liens that
would not reasonably be expected to have, individually or in the aggregate, a Transfer Group Material Adverse Effect. 
  
 “Person” means and includes natural persons, corporations, limited partnerships, limited liability companies, general partnerships, joint
stock companies, joint ventures, associations, companies, trusts, banks, trust companies, land trusts, business trusts or other organizations, whether or not legal entities, and all Governmental Authorities. 
  
 “Plan” means the Fifth Amended Joint Plan of Affiliated
Debtors pursuant to chapter 11 of the Bankruptcy Code, dated January 9, 2004, as proposed by Enron and its debtor affiliates, including, without limitation, the exhibits and schedules attached thereto, as the same may be modified and supplemented
from time to time. 
  
 “Post-Closing Covenant”
shall have the meaning set forth in Section 10.1(b). 
  
 “Pre-Closing Covenant” shall have the meaning set forth in Section 10.1(a). 
  
 “Preliminary Purchase Price” shall have the meaning set forth in Section 2.1. 
  
 “Preparing Party” shall have the meaning set forth in
Section 9.2(d). 
  

 56 

 “Prime Rate” means the prime lending rate as reported in The Wall Street Journal (under
the heading “Money Rates”) on the Closing Date. 
  
 “Principal Contribution Transaction Documents” means the (i) Transition Services Agreement, (ii) Transition Services Supplemental Agreement, (iii) Cross License Agreement, dated as of March 31, 2004, by and among Enron,
NBI, Transwestern Pipeline Company, Florida Gas Transmission Company, Northern Border Pipeline Company, Enron Operations Services, LLC and Northern Plains, (iv) Sublease, (v) Release Agreement, dated as of March 31, 2004, by and among the Enron
Sellers, CrossCountry, CrossCountry Energy Corp., CrossCountry Energy Services, LLC, CrossCountry Alaska, LLC, CrossCountry Citrus Corp., NBP Services, Pan Border Gas Company, Northern Plains, Transwestern Holding Company, Inc. and Transwestern
Pipeline Company and (vi) Tax Sharing Agreement. 
  
 “Principal Shippers” shall have the meaning set forth in Section 4.12. 
  
 “Purchase Price” shall have the meaning set forth in Section 2.1. 
  
 “Purchaser” shall have the meaning set forth in the recitals hereto. 
  
 “Purchaser Indemnified Parties” means Purchaser and its
directors, officers, employees, any Person that becomes a Subsidiary of Purchaser upon the transfer of the Equity Interest at Closing, Affiliates (but only in their capacity as Affiliates of Purchaser or in connection with the sale of the Equity
Interest under this Agreement), agents (but only in their capacity as agents of Purchaser or in connection with the sale of the Equity Interest under this Agreement), successors and assigns; provided, however, that the term
“Purchaser Indemnified Parties” shall not include any Northern Border Company or any third party partner of any such company. 
  
 “Purchaser Material Adverse Effect” means any change, circumstance or event that would materially hinder or delay Purchaser’s
ability to consummate the transactions contemplated by this Agreement, other than any such change, circumstance or event which results from any of the events described in clauses (i), (ii) and (iii) of Section 3.2(d) or from any material breach by
Seller of any covenant or agreement in this Agreement or from any representation or warranty of Seller having been or having become untrue in any material respect. 
  
 “Purchaser Related Parties” shall mean any potential investors, partners, members, lenders and financing
sources of Purchaser and its respective Affiliates and Representatives. 
  
 “Representatives” means a party’s Affiliates, and its officers, directors, employees, attorneys, investment bankers, accountants and other agents and representatives. 
  

 57 

 “Resolution Period” means the period ending thirty (30) days following receipt by an
Indemnified Party of a written notice from an Indemnifying Party stating that it disputes all or any portion of a claim set forth in an Indemnity Notice or a Third Party Claim Notice. 
  
 “Rights of Way” shall have the meaning set forth in Section 4.9(a). 
  
 “SEC” shall have the meaning set forth in Section 4.6(b).

  
 “Securities Act” shall have the meaning set
forth in Section 4.6(b). 
  
 “Seller Indemnified
Parties” means Seller, its Affiliates and their respective Representatives, successors and assigns. 
  
 “Seller Material Adverse Effect” means any change, circumstance or event that would materially hinder or delay Seller’s ability to
consummate the transactions contemplated by this Agreement, excluding any such change, circumstance or event to the extent resulting from any material breach by Purchaser of any covenant or agreement in this Agreement or from any representation or
warranty of Purchaser having been or having become untrue in any material respect. 
  
 “Seller” shall have the meaning set forth in the recitals hereto. 
  
 “Severance Payment Costs” shall have the meaning set forth in Section 6.12(a). 
  
 “Straddle Period” shall have the meaning set forth in
Section 9.2(c)(ii). 
  
 “Sublease” means the
Sublease, dated as of March 31, 2004, between Enron and CrossCountry. 
  
 “Subsidiary or subsidiary” means, with respect to any Person, any corporation, limited liability company, joint venture or partnership of which such Person (a) beneficially owns, either directly or indirectly, more
than fifty percent (50%) of (i) the total combined voting power of all classes of voting securities of such entity, (ii) the total combined equity interests, or (iii) the capital or profit interests, in the case of a partnership; or (b) otherwise
has the power to vote or to direct the voting of sufficient securities to elect a majority of the board of directors or similar governing body. 
  
 “Tax” means all federal, state, provincial, territorial, municipal, local or foreign income, profits, franchise, gross receipts,
environmental (including taxes under Code Section 59A), customs, duties, net worth, sales, use, goods and services, withholding, value added, ad valorem, employment, social security, disability, occupation, pension, real property, personal property
(tangible and intangible), stamp, transfer, conveyance, severance, production, excise and other taxes, withholdings, duties, 

  

 58 

 
levies, imposts and other similar charges and assessments (including any and all fines, penalties and additions attributable to or otherwise imposed on or
with respect to any such taxes, charges, fees, levies or other assessments, and interest thereon) imposed by or on behalf of any Taxing Authority. 
  
 “Tax Basket” shall mean the NP Tax Basket. 
  
 “Tax Package” shall have the meaning set forth in Section 9.2(a)(i). 
  
 “Tax Proceeding” shall have the meaning set forth in Section 9.4(a). 
  
 “Tax Returns” means any report, return, declaration, claim
for refund, information report or return or statement required to be supplied to a Taxing Authority in connection with Taxes, including any schedule or attachment thereto or amendment thereof. 
  
 “Tax Sharing Agreement” means the Tax Sharing Agreement,
dated as of March 31, 2004, between Enron, Enron Transportation Services, LLC, EOC Preferred, L.L.C., Northern Plains, Pan Border Gas Company, NBP Services, Transwestern Pipeline Company, Transwestern Holding Company, Inc. and CrossCountry Citrus
Corp. 
  
 “Taxing Authority” means any
Governmental Authority exercising any authority to impose, regulate, levy, assess or administer the imposition of any Tax. 
  
 “Third Party Claim” shall have the meaning set forth in Section 10.4(b). 
  
 “Third Party Claim Notice” shall have the meaning set forth in Section 10.4(b). 
  
 “Transaction Documents” means the Deposit Escrow Agreement.

  
 “Transfer Group Companies” means the Northern
Plains Group Companies and NBP Services. For the avoidance of doubt, any reference to the term “Transfer Group Companies” shall include only the entities specified in the previous sentence and shall not be construed to cover the
conduct or operations of the Northern Border Companies or Persons in which the Northern Border Companies hold a minority interest. 
  
 “Transfer Group Material Adverse Effect” means any change, circumstance or event that is materially adverse to the business, financial
condition or assets of the Transfer Group Companies, taken as a whole, excluding any such change, circumstance or event to the extent resulting from (i) the economy or securities markets in general, or any outbreak of hostility, terrorist activities
or war, (ii) the announcement, pendency or consummation of the sale of the Equity Interest or any other action by Seller or any Transfer Group Company contemplated by or required by this Agreement, (iii) the 

  

 59 

 
filing of the Enron Bankruptcy Cases, (iv) the confirmation of the effectiveness of the Plan, (v) the conversion or dismissal of any Enron Bankruptcy Case,
(vi) the appointment of a chapter 11 trustee or examiner in any Enron Bankruptcy Case, or (vii) any changes in general economic, political or regulatory conditions in industries or countries in which any of the Transfer Group Companies operates,
including changes applicable to (A) the international, national, regional, or local wholesale markets for natural gas, capacity or throughput, (B) international, national, regional or local interstate natural gas pipeline systems, and (C) rules,
regulations or decisions affecting the interstate natural gas transmission industry as a whole. 
  
 “Transition Services Agreement” means the Transition Services Agreement, dated as of March 31, 2004, between Enron and CrossCountry, as
it may be amended pursuant to the Enron Purchase Agreement. 
  
 “Transition Services Supplemental Agreement” means the Transition Services Supplemental Agreement, dated as of March 31, 2004, between Enron and CrossCountry, as it may be amended pursuant to the Enron Purchase Agreement.

  
 “Transportation Contracts” shall have the
meaning set forth in Section 4.11(a)(vii). 
  
 “Treasury
Regulations” means the regulations promulgated under the Code. 
  
 “True-up Amount” shall have the meaning set forth on Schedule 2.1. 
  
 11.2 Other Terms. 
  
 Other terms may be defined elsewhere in this Agreement and, unless otherwise indicated, shall have such meaning throughout this Agreement. 
  
 11.3 Knowledge Qualifiers. References to “Seller’s
Knowledge” or “to the Knowledge of Seller” and similar terms shall refer to the actual knowledge, without any requirement of inquiry or investigation, of any of the individuals listed on Schedule 11.3. 
  
 11.4 Interpretation. Whenever the words “include”,
“includes” or “including” are used in this Agreement, they shall be deemed to be followed by the words “without limitation”. The words “hereof,” “herein” and “hereunder” and words of
similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement. The definitions contained in this Agreement are applicable to the singular as well as the plural forms of such
terms and to the masculine as well as to the feminine and neuter genders of such terms. 
  

 60 

 ARTICLE XII 
  
 MISCELLANEOUS 
  
 12.1 Expenses. Except as otherwise set forth in this Agreement, each of Seller and Purchaser shall each bear its own expenses incurred in
connection with the negotiation and execution of this Agreement and each other agreement, document and instrument contemplated by this Agreement and the consummation of the transactions contemplated hereby and thereby, it being understood that in no
event shall any of the Transfer Group Companies bear any of such costs and expenses. 
  
 12.2 Incorporation of Exhibits and Schedules. The exhibits and schedules identified in this Agreement are incorporated herein by reference and made a part hereof. Any information disclosed on any schedule
hereto shall be deemed disclosed for all schedules hereto. Any matter disclosed in any section of a schedule shall be deemed disclosed in each section of such schedule. 
  
 12.3 Submission to Jurisdiction: Consent to Service of Process. 
  
 (a) Any claims or disputes which may arise or result from, or be connected
with, this Agreement, any breach or default hereunder, or the transactions contemplated by this Agreement, and any and all Actions related to the foregoing shall be filed and maintained exclusively in the United States District Court for the
Southern District of New York sitting in New York County or the Commercial Division, Civil Branch of the Supreme Court of the State of New York sitting in New York County and any appellate court from any thereof. 
  
 (b) The parties hereby unconditionally and irrevocably waive, to the fullest
extent permitted by Applicable Law, any objection which they may now or hereafter have to the laying of venue of any dispute arising out of or relating to this Agreement or any of the transactions contemplated by this Agreement brought in any court
specified in paragraph (a) above, or any defense of inconvenient forum for the maintenance of such dispute. Each of the parties hereto agrees that a judgment in any such dispute may be enforced in other jurisdictions by suit on the judgment or in
any other manner provided by law. 
  
 (c) Each of the parties
hereto hereby consents to process being served by any party to this Agreement in any suit, Action or proceeding by the mailing of a copy thereof in accordance with the provisions of Section 12.11. 
  
 12.4 Waiver of Jury Trial. THE PARTIES HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVE, TO THE FULLEST EXTENT PERMITTED BY 

  

 61 

 
APPLICABLE LAW, ANY RIGHT THAT THEY MAY HAVE TO TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION, OR IN ANY LEGAL PROCEEDING, DIRECTLY OR INDIRECTLY BASED UPON
OR ARISING OUT OF THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT (WHETHER BASED ON CONTRACT, TORT, OR ANY OTHER THEORY). EACH PARTY (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT, OR ATTORNEY OF THE OTHER PARTIES HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTIES WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE
MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 12.4. 
  
 12.5
No Consequential or Punitive Damages. No party hereto (or its Affiliates) shall, under any circumstance, be liable to any other party (or its Affiliates) for any consequential, exemplary, special, incidental or punitive damages claimed by
such other party under the terms of or due to any breach of this Agreement, including, but not limited to, loss of revenue or income, cost of capital, or loss of business reputation or opportunity. 
  
 12.6 No Right of Set-Off. Purchaser for itself and for its
Subsidiaries, Affiliates, successors and assigns hereby unconditionally and irrevocably waives any rights of set-off, netting, offset, recoupment, or similar rights that Purchaser or any of its Subsidiaries, Affiliates, successors and assigns has or
may have with respect to the payment of the Purchase Price or any other payments to be made by the Purchaser pursuant to this Agreement or any other document or instrument delivered by Purchaser in connection herewith. 
  
 12.7 Time of Essence. With regard to all dates and time periods set
forth or referred to in this Agreement, time is of the essence. 
  
 12.8 Entire Agreement; Amendments and Waivers. This Agreement (including the schedules and exhibits hereto), the Confidentiality Agreement and the Transaction Documents represent the entire understanding and agreement between the
parties hereto with respect to the subject matter hereof and can be amended, supplemented or changed, and any provision hereof can be waived, only by written instrument making specific reference to this Agreement signed by the party against whom
enforcement of any such amendment, supplement, modification or waiver is sought. No action taken pursuant to this Agreement, including, without limitation, any investigation by or on behalf of any party, shall be deemed to constitute a waiver by the
party taking such action of compliance with any representation, warranty, covenant or agreement contained herein. The waiver by any party hereto of a breach of any provision of this Agreement shall not operate or be construed as a further or
continuing waiver of such breach or as a waiver of any other or subsequent breach. No failure on the part of any party to exercise, and no delay in exercising, any right, power or remedy hereunder shall 

  

 62 

 
operate as a waiver thereof; nor shall any single or partial exercise of such right, power or remedy by such party preclude any other or further exercise
thereof or the exercise of any other right, power or remedy. Except as otherwise provided herein, all remedies hereunder are cumulative and are not exclusive of any other remedies provided by Law. 
  
 12.9 Governing Law. THIS AGREEMENT, THE RIGHTS AND OBLIGATIONS OF THE
PARTIES UNDER THIS AGREEMENT, AND ANY CLAIM OR CONTROVERSY DIRECTLY OR INDIRECTLY BASED UPON OR ARISING OUT OF THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT (WHETHER BASED ON CONTRACT, TORT, OR ANY OTHER THEORY), INCLUDING ALL
MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, SHALL IN ALL RESPECTS BE GOVERNED BY AND INTERPRETED, CONSTRUED, AND DETERMINED IN ACCORDANCE WITH, THE APPLICABLE PROVISIONS OF THE INTERNAL LAWS OF THE STATE OF NEW YORK (WITHOUT REGARD TO ANY
CONFLICTS OF LAW PROVISION THAT WOULD REQUIRE THE APPLICATION OF THE LAW OF ANY OTHER JURISDICTION). 
  
 12.10 Table of Contents and Headings. The table of contents and Section headings of this Agreement are for reference purposes only and are to be
given no effect in the construction or interpretation of this Agreement. 
  
 12.11 Notices. All notices and other communications under this Agreement shall be in writing and shall be deemed duly given (i) when delivered personally or by prepaid overnight courier, with a record of
receipt, (ii) the fourth day after mailing if mailed by certified mail, return receipt requested, or (iii) the day of transmission, if sent by facsimile or telecopy during regular business hours, or the day after transmission, if sent after regular
business hours (with a copy promptly sent by prepaid overnight courier with record of receipt or by certified mail, return receipt requested), to the parties at the following addresses or telecopy numbers (or to such other address or telecopy number
as a party may have specified by notice given to the other parties pursuant to this provision): 
  
 If to Seller, to: 
  
 CCE Holdings, LLC 
 c/o Southern Union Company

 One PEI Center, Second Floor 
 Wilkes-Barre, PA 18711 
 Attention: Thomas F. Karam, President and COO 
 Facsimile: (570) 829-8900 
  
 And to: 
  
 General Electric Capital Corporation 
 120
Long Ridge Road 
 Stamford, CT 06927 
 Attention: Manager of Operations 
 Facsimile: (203) 961-5818 
  

 63 

 With a copy to: 
  

Fleischman & Walsh, LLP 
 1919
Pennsylvania Avenue, N.W., Suite 600 
 Washington, DC 20006 
 Attention: Sean P. McGuinness 
 Facsimile: (202) 265-5706 
  
 And a copy to: 
  
 Paul, Hastings, Janofsky & Walker LLP 
 1055 Washington Boulevard 
 Stamford, CT 06901 
 Attention: Jonathan Birenbaum 
 Facsimile:
(203) 359-3031 
  
 If to Purchaser, to: 
  
 ONEOK, Inc. 
 100 West Fifth Street 
 Tulsa, OK 74103

 Attention: David Kyle, Chairman, President and Chief Executive Officer 
 Facsimile: (918) 588-7961 
  
 With a copy to: 
  
 Gable & Gotwals 
 100 West Fifth Street,
Suite 1100 
 Tulsa, OK 74103 
 Attention: John R. Barker 
 Facsimile: (918) 595-4990 
  
 12.12 Severability. If any provision of this Agreement is invalid or unenforceable, the balance of this Agreement
shall remain in effect. 
  
 12.13 Binding Effect;
Assignment. This Agreement shall be binding upon and inure to the benefit of the parties and their respective successors and permitted assigns. Except as set forth in Sections 6.1, 6.7, Article IX and Article X, nothing in this Agreement shall
create or be deemed to create any third party beneficiary rights in any Person not a party to this Agreement. No assignment of this Agreement or of any rights or obligations hereunder may be made by any of Seller or Purchaser (by operation of Law or
otherwise) without the prior written consent of the other parties hereto and any attempted assignment without the required consents shall be void, except that Purchaser 

  

 64 

 
shall have the right to assign this Agreement to a direct or indirect wholly-owned subsidiary of Purchaser. Upon receipt of notice by Seller from Purchaser
of any such assignment to a direct or indirect wholly-owned subsidiary, such assignee will be deemed to have assumed, ratified, agreed to be bound by and perform all such obligations, in each case without the necessity for further act or evidence by
the parties hereto or such assignee; provided, however, that no such assignment shall relieve or discharge Purchaser from any of its obligations hereunder. 
  
 12.14 Counterparts. This Agreement may be executed in any number of counterparts, each of which will be deemed an original, but all of which
together will constitute one and the same instrument. 
  
 12.15
Specific Performance. 
 Seller hereby agrees that, from and after the consummation of the Enron Purchase Agreement, in the event of any breach by
Seller of any material covenant, obligation or other term or provision set forth in this Agreement for the benefit of Purchaser, Purchaser shall be entitled to a decree or order of specific performance or mandamus to enforce the observance and
performance of such covenant, obligation or other term or provision; provided, however, that Purchaser’s right under this Section 12.15 shall terminate upon Closing; provided further, that this Section 12.15 shall
not apply to enforcement of the parties’ respective obligations under Sections 6.13(a), 8.1(d) or 8.2(d). 
  
 [REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK; 
 SIGNATURE PAGE FOLLOWS]

  

 65 

  
 IN WITNESS WHEREOF, the
parties hereto have caused this Agreement to be executed by their respective officers thereunto duly authorized, as of the date first written above. 
  

					
	CCE HOLDINGS, LLC
			
	 By:
	 	 	 	 
	 	 	 Name:
	 	 Thomas F. Karam

	 	 	 Title:
	 	 President

	
	ONEOK, INC.
			
	 By:
	 	 	 	 
	 	 	 Name:
	 	 David L. Kyle

	 	 	 Title:
	 	 Chairman of the Board, President and Chief Executive Officer

  

 66 

  
 Schedule 2.1 

  
 ADJUSTMENT OF
PURCHASE PRICE 
  
 (a) At least
three (3) days prior to the Closing Date, Seller shall prepare and deliver to Purchaser a statement (the “Estimated Closing Statement”) setting forth Seller’s good faith estimate of the adjustment to the Purchase Price (the
“Estimated Purchase Price Adjustment”), which shall include a reasonably detailed calculation of the amount of all capital contributions (or other payments required to be made by the Enron Sellers in their capacity as equity holder)
made (or are expected to be made on or before the Closing Date) by the Enron Sellers or their Affiliates (other than a Transfer Group Company or Northern Border Company) directly or indirectly to a Northern Plains Group Company or Northern Border
Company (the “Northern Capital Contribution”) for the period beginning with the first day after the Balance Sheet Date and ending on the Closing Date (the “Northern Capital Contribution Amount”). The Estimated
Purchase Price Adjustment, shall equal the Northern Capital Contribution Amount. The Estimated Closing Statement prepared by Seller shall be based upon the Estimated Closing Statement (as defined in the Enron Purchase Agreement) to be delivered to
Seller pursuant to the Enron Purchase Agreement. 
  
 (b) Purchaser
shall prepare and deliver to Seller, within twenty (20) days following the Closing Date, a statement (the “Final Closing Statement”), which shall include a reasonably detailed worksheet setting forth the information specified in
subsections (i) to (iii) below. Seller shall grant Purchaser and its Affiliates and Representatives access at reasonable times and places to all books, records and employees of Seller (in each case, only those portions or aspects as they relate
solely to the Transfer Group Companies) that is reasonably requested by Purchaser in connection with Purchaser’s preparation of the Final Closing Statement or in responding to any Objection. 
  
 (i) a reasonably detailed calculation of the Northern
Capital Contribution for the period beginning with the first day after the Balance Sheet Date and ending on the Closing Date (the “Final Northern Capital Contribution Amount”); 
  
 (ii) a calculation of the aggregate purchase price
adjustment (the “Final Purchase Price Adjustment”), which shall equal the Final Northern Capital Contribution Amount; and 
  
 (iii) a calculation of the true-up amount (the “True-up Amount”), which may be positive or negative and shall be the
result of (A) the Estimated Purchase Price Adjustment minus (B) the Final Purchase Price Adjustment. 
  
 (c) Seller shall have forty-five (45) days from its receipt of the Final Closing Statement (the “Objection Period”) to review the Final
Closing Statement. Upon the expiration of such forty-five (45) day period, Seller shall be deemed to have accepted, and shall be bound by, the Final Closing Statement and the calculation therein of the 

  

 
Final Purchase Price Adjustment, unless Seller has informed Purchaser in writing of its disagreement with the Final Closing Statement prior to the expiration
of such forty-five (45) day period (the “Objection”), specifying each of the disputed items and setting forth in reasonable detail the basis for each such dispute (each, a “Disputed Item”). Purchaser shall have
twenty (20) days from the date on which they received the Objection (the date on which such twenty (20) day period ends, the “Objection Date”) to review and respond to such Objection. If Purchaser and Seller are able to negotiate a
mutually agreeable resolution of each Disputed Item, and each signs a certificate to that effect, the Final Closing Statement and the calculation therein of the Final Purchase Price Adjustment, and, if applicable, the True-up Amount, as adjusted to
reflect such resolution, shall be deemed final, non-appealable and binding for purposes of this Agreement. Purchaser shall grant Seller and their Affiliates and Representatives access at reasonable times and places to all books, records and
employees of the Northern Plains Group Companies, and shall use commercially reasonable efforts to provide such access with regards to the Northern Border Companies, that is reasonably requested by Seller in connection with Seller’s review of
the Final Closing Statement. 
  
 (d) If within thirty (30) days of
the Objection Date any Disputed Items have not been resolved in accordance with paragraph (c), Seller and Purchaser shall refer such Disputed Items to an accounting expert (the “Accounting Referee”), within five (5) days after
acceptance of appointment by the Accounting Referee, to make a final, non-appealable and binding determination as to such remaining Disputed Items pursuant to the terms hereof. The Accounting Referee shall be selected by mutual agreement of
Purchaser and Seller, but in the event that an Accounting Referee has been appointed under the Enron Purchase Agreement to resolve a bona fide dispute thereunder, such Accounting Referee shall serve as the Accounting Referee hereunder;
provided in the event that no Accounting Referee is appointed pursuant to the preceding provision within fifty (50) days of the Objection Date, Seller and Purchaser shall each, within sixty (60) days of the Objection Date, select an accountant who
is a partner at a nationally recognized firm of independent public accountants, who shall be directed to select, within seventy (70) days of the Objection Date, a third accountant to serve as the Accounting Referee; provided further that any
Accounting Referee appointed pursuant to this sentence shall be an active or recently retired certified public accountant or accounting expert with substantial experience with assets and complex financial transactions of the type set forth in the
Agreement. The Accounting Referee shall be directed to make a determination in accordance with paragraph (e) below of the Disputed Items promptly, but no later than sixty (60) days, after acceptance of its appointment. Seller and Purchaser agree to
use their commercially reasonable efforts to effect the selection and appointment of the Accounting Referee pursuant to this paragraph (d), including, without limitation, executing an engagement agreement with the Accounting Referee providing for
reasonable and customary compensation and other terms of such engagement. Seller and Purchaser shall make readily available to the Accounting Referee all relevant books, records and employees of the Northern Plains Group Companies, if applicable,
and shall use commercially reasonable efforts to make readily available to the Accounting Referee all relevant books, records and employees of Northern Border Companies, if applicable, that are reasonably requested by the Accounting Referee in
connection with the Accounting Referee’s review of any Disputed Items; provided that Seller, Purchaser and 

  

 
their respective Affiliates shall not be obligated to provide any information the disclosure of which would jeopardize any privilege available to such Person
relating to such information or which would cause such Person to breach a confidentiality obligation to which it is bound; and provided further that Seller, Purchaser and their respective Affiliates shall use their best efforts to minimize the
effects of any such limitations. 
  
 (e) If Disputed Items are
referred to the Accounting Referee for resolution pursuant to paragraph (d) above, the Accounting Referee (i) shall determine only with respect to the Disputed Items submitted whether and to what extent, if any, the Final Purchase Price Adjustment
set forth in the Final Closing Statement and, if applicable, the True-up Amount requires adjustment, and (ii) shall not assign a value to any item greater than the greatest value for such item claimed by either party or less than the smallest value
for such item claimed by either party. Any finding by the Accounting Referee shall be a reasoned award stating in reasonable detail the findings of fact (if any) on which it is based, shall be final, non-appealable and binding upon the parties and
shall be the sole and exclusive remedy between the parties regarding the Disputed Items so presented. The fees and expenses of the Accounting Referee shall be borne by Seller and Purchaser in the same proportion that the dollar amount of Disputed
Items which are not resolved in favor of Seller or Purchaser (as applicable) bears to the total dollar amount of Disputed Items resolved by the Accounting Referee. For illustration purposes only, (A) if the total amount of Disputed Items by Seller
is $1,000, and Seller is awarded $500 by the Accounting Referee, Seller and Purchaser shall bear the Accounting Referee’s fees and expenses equally; or (B) if the total amount of Disputed Items by Seller is $1,000, and Seller are awarded $250
by the Accounting Referee, Seller shall bear seventy five percent (75%) and Purchaser shall bear twenty five percent (25%) of the Accounting Referee’s fees and expenses. Seller and Purchaser shall bear the fees, costs and expenses of its own
accountants and all of its other expenses incurred in connection with matters contemplated by this Schedule 2.1. 
  
 (f) If the True-up Amount is (i) a positive number, then Seller shall pay Purchaser such amount or (ii) a negative number, then Purchaser shall pay Seller
such amount. Payment of the True-up Amount calculated pursuant to this Schedule 2.1 shall be made (i) if no Objection is made by Seller during the Objection Period, within ten (10) days following the expiration of the Objection Period or (ii)
if Seller submits an Objection within the Objection Period, within ten (10) days following final resolution of all Disputed Items by the parties or the Accounting Referee, by wire transfer of immediately available funds to an account designated by
the parties receiving such funds, plus interest thereon from and including the Closing Date through and including the day before the date of such payment, at a per annum rate equal to the Prime Rate as at the Closing Date. 
  

  
 TABLE OF CONTENTS

  

					
	 ARTICLE I SALE AND PURCHASE OF EQUITY INTEREST
	  	2
			
	 1.1
	  	 Sale and Purchase of Equity Interest
	  	2
		
	 ARTICLE II PURCHASE PRICE AND PAYMENT
	  	2
			
	 2.1
	  	 Purchase Price
	  	2
			
	 2.2
	  	 Deposit
	  	2
			
	 2.3
	  	 Payment of Purchase Price
	  	3
		
	 ARTICLE III CLOSING AND TERMINATION
	  	4
			
	 3.1
	  	 Time and Place of Closing
	  	4
			
	 3.2
	  	 Termination of Agreement
	  	4
			
	 3.3
	  	 Effect of Termination
	  	5
		
	 ARTICLE IV REPRESENTATIONS AND WARRANTIES OF SELLER
	  	6
			
	 4.1
	  	 Organization and Good Standing
	  	6
			
	 4.2
	  	 Authorization of Agreement
	  	6
			
	 4.3
	  	 No Violation; Consents
	  	6
			
	 4.4
	  	 Ownership and Transfer of Equity Interest
	  	7
			
	 4.5
	  	 Transfer Group Companies
	  	7
			
	 4.6
	  	 Financial Statements; Northern Border SEC Reports
	  	9
			
	 4.7
	  	 No Undisclosed Liabilities
	  	9
			
	 4.8
	  	 Absence of Certain Developments
	  	10
			
	 4.9
	  	 Title to Properties
	  	11
			
	 4.10
	  	 Intangible Property
	  	11
			
	 4.11
	  	 Material Contracts
	  	11
			
	 4.12
	  	 Firm and Interruptible Transportation Contracts
	  	13
			
	 4.13
	  	 Employee Benefits
	  	14
			
	 4.14
	  	 Taxes
	  	15
			
	 4.15
	  	 Labor
	  	16
			
	 4.16
	  	 Litigation
	  	16
			
	 4.17
	  	 Compliance with Laws; Permits
	  	17
			
	 4.18
	  	 Environmental Matters
	  	17
			
	 4.19
	  	 Insurance
	  	18

  

					
			
	 4.20
	  	 Financial Advisors
	  	18
			
	 4.21
	  	 No Knowledge of Breach
	  	18
			
	 4.22
	  	 Limitation of Representations and Warranties
	  	18
		
	 ARTICLE V REPRESENTATIONS AND WARRANTIES OF PURCHASER
	  	19
			
	 5.1
	  	 Organization and Good Standing
	  	19
			
	 5.2
	  	 Authorization of Agreement
	  	19
			
	 5.3
	  	 No Violation; Consents
	  	20
			
	 5.4
	  	 Litigation
	  	20
			
	 5.5
	  	 Investment Intention
	  	20
			
	 5.6
	  	 Financial Capability
	  	21
			
	 5.7
	  	 Financial Advisors. Except as set forth on Schedule 5.7, n
	  	21
		
	 ARTICLE VI COVENANTS
	  	21
			
	 6.1
	  	 Access to Information
	  	21
			
	 6.2
	  	 Conduct of the Business Pending the Closing
	  	22
			
	 6.3
	  	 Appropriate Action; Filings
	  	25
			
	 6.4
	  	 Preservation of Records; Cooperation
	  	27
			
	 6.5
	  	 Confidentiality
	  	28
			
	 6.6
	  	 Public Announcements
	  	28
			
	 6.7
	  	 Directors’ and Officers’ Indemnification
	  	28
			
	 6.8
	  	 Further Assurances
	  	29
			
	 6.9
	  	 Financing
	  	29
			
	 6.10
	  	 Payment of Pro Rata Distributions
	  	29
			
	 6.11
	  	 Guarantees
	  	30
			
	 6.12
	  	 Severance Agreements, Plans and Policies
	  	30
			
	 6.13
	  	 Transition Services
	  	31
			
	 6.14
	  	 Purchaser Employee Benefit Plans
	  	32
			
	 6.15
	  	 Financial Information
	  	32
		
	 ARTICLE VII CONDITIONS TO CLOSING
	  	33
			
	 7.1
	  	 Conditions Precedent to Obligations of Each Party
	  	33
			
	 7.2
	  	 Conditions Precedent to Obligations of Purchaser
	  	33
			
	 7.3
	  	 Conditions Precedent to Obligations of Seller
	  	34
		
	 ARTICLE VIII DOCUMENTS TO BE DELIVERED
	  	35
			
	 8.1
	  	 Documents to Be Delivered by Seller
	  	35

  

					
			
	 8.2
	  	 Documents to Be Delivered by Purchaser
	  	35
		
	 ARTICLE IX TAX AND ERISA MATTERS
	  	36
			
	 9.1
	  	 Tax Sharing Agreements
	  	36
			
	 9.2
	  	 Preparation of Tax Returns; Payment of Taxes
	  	36
			
	 9.3
	  	 Certain Other Taxes
	  	39
			
	 9.4
	  	 Tax Audits
	  	40
			
	 9.5
	  	 Dispute Resolution
	  	40
			
	 9.6
	  	 Refunds and Tax Benefits
	  	41
			
	 9.7
	  	 Certain Elections
	  	41
			
	 9.8
	  	 FIRPTA
	  	42
			
	 9.9
	  	 Intentionally Omitted
	  	42
			
	 9.10
	  	 Tax Indemnification
	  	42
			
	 9.11
	  	 Employee Benefits Indemnification
	  	43
			
	 9.12
	  	 Coordination of Provisions
	  	44
		
	 ARTICLE X INDEMNIFICATION
	  	44
			
	 10.1
	  	 Survival of Representations, Warranties, Covenants and Agreements
	  	44
			
	 10.2
	  	 Seller Indemnification
	  	44
			
	 10.3
	  	 Purchaser Indemnification
	  	46
			
	 10.4
	  	 Procedures
	  	47
			
	 10.5
	  	 Tax Treatment of Indemnity Payments
	  	49
			
	 10.6
	  	 Remedies
	  	49
		
	 ARTICLE XI DEFINITIONS
	  	50
			
	 11.1
	  	 Certain Definitions
	  	50
			
	 11.2
	  	 Other Terms
	  	60
			
	 11.3
	  	 Knowledge Qualifiers
	  	60
			
	 11.4
	  	 Interpretation
	  	60
		
	 ARTICLE XII MISCELLANEOUS
	  	61
			
	 12.1
	  	 Expenses
	  	61
			
	 12.2
	  	 Incorporation of Exhibits and Schedules
	  	61
			
	 12.3
	  	 Submission to Jurisdiction: Consent to Service of Process
	  	61
			
	 12.4
	  	 Waiver of Jury Trial
	  	61
			
	 12.5
	  	 No Consequential or Punitive Damages
	  	62
			
	 12.6
	  	 No Right of Set-Off
	  	62

  

					
			
	 12.7
	  	 Time of Essence
	  	62
			
	 12.8
	  	 Entire Agreement; Amendments and Waivers
	  	62
			
	 12.9
	  	 Governing Law
	  	63
			
	 12.10
	  	 Table of Contents and Headings
	  	63
			
	 12.11
	  	 Notices
	  	63
			
	 12.12
	  	 Severability
	  	64
			
	 12.13
	  	 Binding Effect; Assignment
	  	64
			
	 12.14
	  	 Counterparts
	  	65
			
	 12.15
	  	 Specific Performance
	  	65
		
	 Schedule 2.1 ADJUSTMENT OF PURCHASE PRICE
	  	67Form Of Performance Grant Agreement

 Exhibit 10.4 
  
 ROANOKE ELECTRIC STEEL CORPORATION 
 2005 STOCK INCENTIVE PLAN 
  
 PERFORMANCE GRANT 
 AGREEMENT 
  

					
	AWARDED TO	 	 AWARD DATE
  
 January 28, 2005
	 	PERFORMANCE SHARES
			
	SOCIAL SECURITY NUMBER	 	PERFORMANCE PERIOD	 	 

  
 The Compensation
Committee of the Board of Directors of Roanoke Electric Steel Corporation (the “Company”) grants to you (“the Participant”) pursuant to the Company’s 2005 Stock Incentive Plan (the “Plan”) a Performance Grant of
Performance Shares pursuant to Section 10 of the Plan. Each Performance Share that becomes vested under the terms of this Performance Grant shall entitle you to receive one share of common stock of the Company (“Company Stock”), except as
otherwise provided below. The Performance Shares granted under this Performance Agreement (“Agreement”) are subject to the performance conditions and other restrictions set forth below. 
  
 This Agreement incorporates the terms of the Plan, and in the case of any
conflict between the Plan and this Agreement, the terms of the Plan shall control. All terms not otherwise defined in this Agreement shall have the meaning assigned to them in the Plan. The terms of the Performance Grant are as follows: 

 

	1.	Vesting and Amount of Performance Shares. If the Participant remains in continuous employment with the Company or any of its subsidiaries from the Award Date to last day of
the Performance Period, a percentage of the Performance Shares specified above (the “Base Number”) shall become vested as follows: 

  

	 	(a)	The number of Performance Shares which shall become vested Performance Shares shall be determined under the following schedule by multiplying the Base Number by the percentage that
corresponds to the Company’s Relative Average Return on Invested Capital for the Performance Period, and rounding to the nearest whole share: 

  

			
	 Company’s Relative Average
 Return on Invested Capital
 (expressed as a percentile of
 that of the Comparison Group)

	 	 Percentage of Base Number of
 Performance Shares that
 Become Vested

	 95th
	 	200%
	 90th
	 	175%
	 85th
	 	150%
	 80th
	 	125%
	 75th
	 	100%
	 70th
	 	  90%
	 65th
	 	  80%
	 60th
	 	  70%
	 55th
	 	  60%
	 50th
	 	  50%
	 45th
	 	  25%
	 Below 45th
	 	    0%

	 	(b)	If the Participant dies, becomes Disabled or Retires while employed with the Company or any of its subsidiaries, but prior to the end of the Performance Period, the Participant
shall be deemed to have continued in employment with the Company and its subsidiaries through the end of the Performance Period. In the case of death or Disability, the Participant shall be vested in the same number of Performance Shares in which
the Participant would have become vested had the Participant actually remained in continuous employment until the end of the Performance Period. Where the Participant Retires, the Participant shall be vested in Performance Shares equal to the
product of: 

  
 (1) the number of
Performance Shares in which the Participant would have become vested had the Participant actually remained in continuous employment until the end of the Performance Period, and 
  
 (2) a fraction, the numerator of which is the number of days which the Participant had worked during the
Performance Period and the denominator of which is the total number of days in the Performance Period. 
  
 For purposes of this Paragraph 1, “Retires” means the Participant’s termination of employment after (A) having attained age 55 and
completing 10 years of service or (B) having attained age 62. 
  

	 	(c)	Notwithstanding the foregoing, no more than 25% of the Participant’s Base Number shall become vested Performance Shares if the Company’s Average Return on Invested Capital
for the Performance Period is less than zero. 

  

	 	(d)	The target award payment shall be shares of Company Stock equal to 100% of the Participant’s Base Number and the maximum award payment shall be shares of Company Stock equal to
200% of the Participant’s Base Number. 

  

	2.	Forfeiture of Performance Shares. Any Performance Shares that do not become vested pursuant to Paragraph 1 will be forfeited. 

  

	3.	Settlement of Performance Shares. Vested Performance Shares will be settled as soon as practicable after the Compensation Committee has determined and certified in writing
the Company’s Relative Average Return on Invested Capital for the Performance Period, but in no event later than the date that is two and one-half (2 1⁄2) months following the last day of the Performance Period. Subject to Paragraph 8
(pertaining to the withholding of taxes), for each vested Performance Share settled pursuant to this Paragraph 3, the Company shall issue one share of Company Stock and cause to be delivered to the Participant one or more unlegended,
freely-transferable stock certificates in respect of such shares issued upon settlement of the vested Performance Shares. 

  

	4.	Nontransferability of the Performance Shares. The Performance Shares shall not be transferable by the Participant by means of sale, assignment, exchange, encumbrance, pledge,
hedge or otherwise. Company Stock issued in settlement of the Participant’s vested Performance Shares shall be freely-transferable. 

  

	5.	Rights as a Shareholder. The Participant shall not be entitled to any rights of a shareholder with respect to the Performance Shares. No adjustment to the Participant’s
Performance Shares shall be made nor shall any credit be provided to reflect any cash dividends declared or paid with respect to Company Stock during the Performance Period. 

  

	6.	Adjustment in the Event of Change in Stock; Change in Control. In the event of any change in corporate capitalization, such as a stock split or a corporate transaction, such
as any merger, consolidation, separation, including a spin-off, any reorganization (whether or not such reorganization comes within the definition of such term in Section 368 of the Internal Revenue Code of 1986 (the “Code”)) or any
partial or complete liquidation of the Company, the number of Performance Shares shall be equitably adjusted by the Committee as it may deem appropriate in its sole discretion. The determination of the Committee regarding any such adjustment will be
final and conclusive. 

  

 2 

 In addition, in the event of a Change in Control, 100% of the Participant’s Base Number of
Performance Shares shall become vested Performance Shares. The Company shall settle such vested Performance Shares by making a single lump sum cash payment to the Participant equal to the aggregate Fair Market Value (determined as of the last
trading day immediately preceding the Change in Control date) of shares of Company Stock equal in number to the Participant’s vested Performance Shares. Such payment will be made within 15 days following the Change in Control date (the
“Change in Control Payment Date”). However, if Section 409A of the Code applies to this Agreement and payment would not be permitted under Section 409A of the Code at the Change in Control Payment Date, the payment will be made (i) within
15 days following the Participant’s separation from service with the Company or its subsidiaries (or in accordance with the six month delay in payment rule for key employees of Section 409A of the Code, to the extent that rule is applicable),
or (ii) within 15 days following the end of the Performance Period if the Participant has not separated from service with the Company or its subsidiaries.. 
  
 If during the Performance Period the Participant’s primary employment is with a subsidiary of the Company, the term Change of Control shall include
an event described in Section 2(d)(iii) or Section 2(d)(iv) of the Plan which occurs with respect to such subsidiary while the subsidiary is the Participant’s primary employer. 
  

	6A.	Payment of Transfer Taxes, Fees and Other Expenses. The Company will pay any and all original issue taxes and stock transfer taxes that may be imposed on the issuance of
shares of Company Stock received by the Participant in connection with settlement of the Participant’s vested Performance Shares, together with any and all other fees and expenses necessarily incurred by the Company in connection therewith.

  

	7.	Other Restrictions. 

  

	 	(a)	The Performance Shares shall be subject to the requirement that, if at any time the Committee shall determine that (i) the listing, registration or qualification of the shares of
Company Stock subject or related thereto upon any securities exchange or under any state or federal law, or (ii) the consent or approval of any government regulatory body, then in any such event, the grant of Performance Shares shall not be
effective unless such listing, registration, qualification, consent or approval shall have been effected or obtained free of any conditions not acceptable to the Committee. 

  

	 	(b)	The Participant acknowledges that the Participant is subject to the Company’s policies regarding compliance with securities laws, including but not limited to its Trading
Policy (as in effect from time to time and any successor policies), and, pursuant to these policies, if the Participant is on the Company’s insider list, the Participant shall be required to obtain pre-clearance from the Company’s General
Counsel prior to purchasing or selling any of the Company’s securities, including any shares issued upon settlement of vested Performance Shares, and may be prohibited from selling such shares other than during an open trading window. The
Participant further acknowledges that, in its discretion, the Company may prohibit the Participant from selling such shares even during an open trading window if the Company has concerns over the potential for insider trading.

  

	8.	Taxes and Withholding. No later than the date as of which an amount first becomes includible in the gross income of the Participant for federal, state, local or foreign
income tax purposes with respect to any Performance Shares, the Participant shall pay to the Company, or make arrangements satisfactory to the Company regarding the payment of, all federal, state, local and foreign taxes that are required by
applicable laws and regulations to be withheld with respect to such amount. The obligations of the Company under this Agreement shall be conditioned on compliance by the Participant with this Paragraph 8, and the Company shall, to the extent
permitted by law, have the right to deduct any such taxes from any payment otherwise due to the Participant, including deducting such amount from the delivery of shares of Company Stock issued upon settlement of the Performance Shares that gives
rise to the withholding requirement. 

  

 3 

	9.	Notices. All notices and other communications under this Agreement shall be in writing and shall be given by hand delivery to the other party or by facsimile, overnight
courier, or registered or certified mail, return receipt requested, postage prepaid, addressed as follows: 

  

			
	 If to the Participant:
	 	 If to the Company:

		
	 	 	 Roanoke Electric Steel Corporation

	 	 	 PO Box 13948

	 	 	 Roanoke, VA 24038

	 	 	 Attention: General Counsel
 /Corporate Secretary

	 	 	 Facsimile: (540) 983-7284

  
 or to such other
address or facsimile number as any party shall have furnished to the other in writing in accordance with this Paragraph 9. Notice and communications shall be effective when actually received by the addressee. Notwithstanding the foregoing, the
Participant consents to electronic delivery of documents required to be delivered by the Company under the securities laws. 
  

	10.	Effect of Agreement. Except as otherwise provided hereunder, this Agreement shall be binding upon and shall inure to the benefit of any successor or successors of the
Company, and the term “Company” shall include any successor company. 

  

	11.	Laws Applicable to Construction. The interpretation, performance and enforcement of this Agreement shall be governed by the laws of the Commonwealth of Virginia without
reference to principles of conflict of laws, as applied to contracts executed in and performed wholly within the Commonwealth of Virginia. In addition to the terms and conditions set forth in this Agreement, the Performance Shares are subject to the
terms and conditions of the Plan, which is hereby incorporated by reference. 

  

	12.	Severability. The invalidity or enforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement.

  

	13.	Conflicts and Interpretation. In the event of any conflict between this Agreement and the Plan, the Plan shall control. In the event of any ambiguity in this Agreement, or
any matters as to which this Agreement is silent, the Plan shall govern including, without limitation, the provisions thereof pursuant to which the Committee has the power, among others, to (i) interpret the Plan, (ii) prescribe, amend and rescind
rules and regulations relating to the Plan, and (iii) make all other determinations deemed necessary or advisable for the administration of the Plan. 

  

	14.	Amendment. Except as otherwise provided in Section 16 of the Plan, this Agreement may not be modified, amended or waived except by an instrument in writing signed by both
parties hereto. The waiver by either party of compliance with any provision of this Agreement shall not operate or be construed as a waiver of any other provision of this Agreement, or of any subsequent breach by such party of a provision of this
Agreement. 

  

	15.	Headings. The headings of paragraphs herein are included solely for convenience of reference and shall not affect the meaning or interpretation of any of the provisions of
this Agreement. 

  

	16.	Counterparts. This Agreement may be executed in counterparts, which together shall constitute one and the same original. 

  

	17.	No Right to Continued Employment. Neither the Plan nor this Agreement confers upon you any right to continue as an employee of the Company or of any subsidiary of the
Company, or limits in any respect the right of the Company or any subsidiary of the Company to terminate your employment, or modify the terms of such employment. This Agreement does not guarantee your employment with the Company or with any
subsidiary of the Company during the period in which it is in effect 

  

 4 

	18.	Definitions. As used in this Agreement, the following capitalized terms have the meanings indicated: 

  

	 	(a)	“Average Invested Capital” means, for a Performance Year, the average of the Invested Capital measured as of the beginning of the first day and the end of the last day of
the Performance Year. 

  

	 	(b)	“Average Return on Invested Capital” means the sum of the Return on Invested Capital for each Performance Year of a company which ends with or within the
Performance Period, divided by the number of years in the Performance Period. 

  

	 	(c)	“Award Date” means that date on which Performance Shares are awarded to the Participant. For purposes of this Agreement, the Award Date is January 28, 2005.

  

	 	(d)	“Comparison Group” means those companies in the custom peer group approved by the Committee and listed on Schedule A to this Agreement. Adjustments will not be made
to the performance of the Comparison Group to reflect composition changes during the Performance Period. 

  

	 	(e)	“Invested Capital” means, as of any date, shareholders’ equity, plus long-term debt (including the current portion of such debt. 

  

	 	(f)	“Net Income” means the income before extraordinary items and discontinued operations. 

  

	 	(g)	“Performance Period” means the one-year period beginning on November 1, 2004 and ending on October 31, 2005. 

  

	 	(h)	“Performance Share” means a right to receive a share of Company Stock, subject to the conditions and restrictions described in this Agreement. 

  

	 	(i)	“Performance Year” means, for the Company, its fiscal year. For companies in the Comparison Group, “Performance Year” means the 12-month period set forth on
Schedule A to this Agreement under the column titled “Performance Year”. 

  

	 	(j)	“Relative Average Return on Invested Capital” means the Company’s Average Return on Invested Capital relative to the Average Return on Invested Capital for the
companies comprising the Comparison Group, expressed as a percentile ranking. 

  

	 	(k)	“Return on Invested Capital” means for a company’s Performance Year, Net Income divided by Average Invested Capital. 

  
 IN WITNESS WHEREOF, the Company has caused this Agreement to be signed, as of
the Award Date shown above. 
  

			
	 ROANOKE ELECTRIC STEEL CORPORATION

		
	 By:
	 	  

  
 I hereby
acknowledge receipt of this Agreement, a copy of the 2005 Stock Incentive Plan and a copy of the Plan’s prospectus. 
  

							
	 Signature:
	 	  

	 	 	 	             Date:
                    

	 	 	 «Name»
	 	 	 	 

  

 5 

 SCHEDULE A 
  
 ROANOKE ELECTRIC STEEL CORPORATION 
  
 2005 STOCK INCENTIVE PLAN 
  
 PERFORMANCE GRANT AGREEMENT 
  
 CUSTOM PEER GROUP 
 (S&P GICS, Sub-Industry
Steel, US Companies, US Primary Issue) 
 (GICS Code 15104050)* 
  

									
	 	  	 Company

	  	 Ticker
 Symbol

	  	 Last Day of
 Fiscal Year

	  	 Performance Year

	1	  	 ACME METALS INC
	  	 AMIIQ
	  	 December 31
	  	 October 1 – September 30

	2	  	 AK STEEL HOLDING CORP
	  	 AKS
	  	 December 31
	  	 October 1 – September 30

	3	  	 ALLEGHENY TECHNOLOGIES INC
	  	 ATI
	  	 December 31
	  	 October 1 – September 30

	4	  	 ATCHISON CASTING CORP
	  	 AHNCQ
	  	 June 30
	  	 October 1 – September 30

	5	  	 BAYOU STEEL CORP -CL A
	  	 BYUA
	  	 September 30
	  	 October 1 – September 30

	6	  	 CARPENTER TECHNOLOGY CORP
	  	 CRS
	  	 June 30
	  	 October 1 – September 30

	7	  	 CASTLE (A M) & CO
	  	 CAS
	  	 December 31
	  	 October 1 –September 30

	8	  	 CENTRAL STEEL & WIRE CO
	  	 CSTW
	  	 December 31
	  	 October 1 – September 30

	9	  	 CLEVELAND-CLIFFS INC
	  	 CLF
	  	 December 31
	  	 October 1 – September 30

	10	  	 COLD METAL PRODUCTS INC
	  	 CMPI
	  	 March 31
	  	 October 1 – September 30

	11	  	 COMMERCIAL METALS
	  	 CMC
	  	 August 31
	  	 September 1 – August 31

	12	  	 FRIEDMAN INDUSTRIES
	  	 FRD
	  	 March 31
	  	 October 1 – September 30

	13	  	 GENEVA STEEL HLDGS CORP
	  	 GNVHQ
	  	 September 30
	  	 October 1 – September 30

	14	  	 GERDAU AMERISTEEL CORP
	  	 GNA
	  	 December 31
	  	 October 1 – September 30

	15	  	 GIBRALTAR INDUSTRIES INC
	  	 ROCK
	  	 December 31
	  	 October 1 – September 30

	16	  	 GRAFTECH INTERNATIONAL LTD
	  	 GTI
	  	 December 31
	  	 October 1 – September 30

	17	  	 GREAT NORTHERN IRON ORE PPTY
	  	 GNI
	  	 December 31
	  	 October 1 – September 30

	18	  	 HAYNES INTERNATIONAL INC
	  	 HYNI
	  	 September 30
	  	 October 1 – September 30

	19	  	 HUNTCO INC -CL A
	  	 3HCOIQ
	  	 December 31
	  	 October 1 – September 30

	20	  	 INTERNATIONAL STEEL GRP INC
	  	 ISG
	  	 December 31
	  	 October 1 – September 30

	21	  	 KENTUCKY ELECTRIC STEEL INC
	  	 KESIQ
	  	 September 29**
	  	 October 1 – September 30**

	22	  	 KEYSTONE CONS INDUSTRIES INC
	  	 KESNQ
	  	 December 31
	  	 October 1 – September 30

	23	  	 LTV CORP
	  	 3LTVCQ
	  	 December 31
	  	 October 1 – September 30

	24	  	 MARK HOLDINGS INC
	  	 MHDG
	  	 June 30
	  	 October 1 – September 30

	25	  	 MESABI TRUST
	  	 MSB
	  	 January 31
	  	 November 1 – October 31

	26	  	 METAL MANAGEMENT INC
	  	 MTLM
	  	 March 31
	  	 October 1 – September 30

	27	  	 METALS USA INC
	  	 MUSA
	  	 December 31
	  	 October 1 – September 30

	28	  	 MMI PRODUCTS INC
	  	 9701B
	  	 January 3**
	  	 October 1 – September 30**

	29	  	 MORTON INDUSTRIAL GRP INC
	  	 3MGRP
	  	 December 31
	  	 October 1 – September 30

	30	  	 NATIONAL STEEL CORP -CL B
	  	 3NSTLQ
	  	 December 31
	  	 October 1 – September 30

	31	  	 NEENAH FOUNDRY CO
	  	 0271B
	  	 September 30
	  	 October 1 – September 30

	32	  	 NIAGARA CORP
	  	 NGCD
	  	 December 31
	  	 October 1 – September 30

	33	  	 NN INC
	  	 NNBR
	  	 December 31
	  	 October 1 – September 30

	34	  	 NORTHWEST PIPE CO
	  	 NWPX
	  	 December 31
	  	 October 1 – September 30

	35	  	 NUCOR CORP
	  	 NUE
	  	 December 31
	  	 October 1 – September 30

	36	  	 OLYMPIC STEEL INC
	  	 ZEUS
	  	 December 31
	  	 October 1 – September 30

	37	  	 OREGON STEEL MILLS INC
	  	 OS
	  	 December 31
	  	 October 1 – September 30

	38	  	 PAV REPUBLIC INC-REDH
	  	 RSBQ
	  	 December 31
	  	 October 1 – September 30

	39	  	 QUANEX CORP
	  	 NX
	  	 October 31
	  	 November 1 – October 31

									
	 	  	 Company

	  	 Ticker
Symbol

	  	 Last Day of
 Fiscal Year

	  	 Performance Year

	40	  	 ROUGE INDUSTRIES INC
	  	 RGIDQ
	  	 December 31
	  	 October 1 – September 30

	41	  	 RYERSON TULL INC
	  	 RT
	  	 December 31
	  	 October 1 – September 30

	42	  	 SCHNITZER STEEL INDS -CL A
	  	 SCHN
	  	 August 31
	  	 September 1 – August 31

	43	  	 STEEL DYNAMICS INC
	  	 STLD
	  	 December 31
	  	 October 1 – September 30

	44	  	 STEEL TECHNOLOGIES
	  	 STTX
	  	 September 30
	  	 October 1 – September 30

	45	  	 SYNALLOY CORP
	  	 SYNL
	  	 January 3**
	  	 October 1 – September 30**

	46	  	 THERMODYNETICS INC
	  	 3TDYN
	  	 March 31
	  	 October 1 – September 30

	47	  	 UNITED STATES STEEL CORP
	  	 X
	  	 December 31
	  	 October 1 – September 30

	48	  	 UNVL STAINLESS & ALLOY PRODS
	  	 USAP
	  	 December 31
	  	 October 1 – September 30

	49	  	 WEBCO INDUSTRIES INC
	  	 WEBO
	  	 July 31
	  	 November 1 – October 31

	50	  	 WEIRTON STEEL CORP
	  	 WRTLQ
	  	 December 31
	  	 October 1 – September 30

	51	  	 WHEELING PITTSBURGH CORP
	  	 WPSC
	  	 December 31
	  	 October 1 – September 30

	52	  	 WHX CORP
	  	 WHX
	  	 December 31
	  	 October 1 – September 30

	53	  	 WILLIAMS INDUSTRIES INC
	  	 WMSI
	  	 July 31
	  	 November 1 – October 31

	54	  	 WORTHINGTON INDUSTRIES
	  	 WOR
	  	 May 31
	  	 September 1 – August 31

	 *	As of January 27, 2005, with the exception of Gerdau Ameristeel Corp., which as of such date is not included in this index. 

	**	These companies have 52/53 week fiscal years, so the actual beginning and ending date of each fiscal year, and, thus, each quarter may vary from year to year. The actual beginning
and ending dates to be included in the column will be adjusted, as necessary from year-to-year.

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