8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC  20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): November 1, 2004

NorthWestern Corporation

(Exact name of registrant as specified in its charter)

Delaware	000-00692		46-0172280
(State or other jurisdiction of incorporation)	(Commission File Number)		(IRS Employer Identification No.)
125 South Dakota Avenue Sioux Falls, South Dakota		57104
(Address of principal executive offices)		(Zip Code)
(605) 978-2908
(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

oWritten communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

oSoliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

oPre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

oPre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01               Entry into a Material Definitive Agreement.

On October 27, 2004, NorthWestern Corporation (the “Company”) filed a Current Report on Form 8-K with the Securities and Exchange Commission (the “Commission”) to report that on October 26, 2004, the Company announced that it had priced $225,000,000 aggregate principal amount of its 5.875% Senior Secured Notes due 2014 (the “Notes”), in a transaction exempt from the registration requirements of the Securities Act of 1933, as amended.  The Notes are collateralized by two series of existing first mortgage bonds secured by the Company’s regulated utility assets in Montana, South Dakota and Nebraska.  The maturity date of the Notes is November 1, 2014.

On November 1, 2004, in connection with the issuance and sale of the Notes, the Company entered into the following agreements: (i) the Company and U.S. Bank National Association, as trustee (the “Note Trustee”), entered into an Indenture (the “Note Indenture”) governing the Notes; (ii) the Company and the Note Trustee entered into Supplemental Indenture No. 1 (the “Supplemental Note Indenture”), supplementing the Note Indenture and governing the Notes; (iii) the Company executed the Notes; (iv) the Company and The Bank of New York and MaryBeth Lewicki entered into a Twenty-fourth Supplemental Indenture (the “Montana Supplemental Indenture”, amending and supplementing that certain Mortgage and Deed of Trust, dated as of October 1, 1945 (the “Original Montana Mortgage”), between the Company (as successor thereunder to NorthWestern Energy, L.L.C., in turn successor thereunder to The Montana Power Company) and The Bank of New York (successor thereunder to Guaranty Trust Company of New York) and MaryBeth Lewicki (successor thereunder to Arthur E. Burke), as trustees, as amended and supplemented by twenty four indentures supplemental thereto (the “Montana Supplemental Indenture”; and the Original Montana Mortgage, as so amended and supplemented, is referred to herein as the “Montana Indenture”); (v) the Company executed a security certificate evidencing $161.0 million principal amount of the Company’s First Mortgage Bonds, Collateral (2004) Series C, due 2014, issued under the Montana Indenture and registered in the name of the Trustee (such bonds being referred to as the “Montana Bonds”); (vi) the Company and JPMorgan Chase Bank, as trustee (the “South Dakota Mortgage Trustee”) entered into a Supplemental Indenture (the “South Dakota Supplemental Indenture”), amending and supplementing the General Mortgage Indenture and Deed of Trust, dated as of August 1, 1993 (the “Original South Dakota Mortgage”), between the Company and JPMorgan Chase Bank (as successor thereunder to The Chase Manhattan Bank (National Association)), as trustee, as previously amended and supplemented by six indentures supplemental thereto (the Original South Dakota Mortgage, as amended and supplemented by such six supplemental indentures and by the South Dakota Supplemental Indenture, being referred to herein as the “South Dakota Indenture” and, together with the Montana Indenture, being referred to herein as the “Mortgages”); (vii) the Company executed a security certificate evidencing $64.0 million principal amount of the Company’s First Mortgage Bonds, Collateral (2004) Series C, due 2014, issued under the South Dakota Indenture and registered in the name of the Trustee (such bonds being referred to as the “South Dakota Bonds”; and the South Dakota Bonds and the Montana Bonds being referred to herein, collectively, as the “Bonds”); and (viii) the Company and Credit Suisse First Boston LLC and Lehman Brothers Inc., on behalf of the several initial purchasers of the Notes (collectively, the “Initial Purchasers”), entered into a Registration Rights Agreement with respect to the Notes (the “Registration Rights Agreement”).

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Material terms and conditions of the Notes and the Note Indenture are described in Item 2.03 of this Current Report on Form 8-K.

Pursuant to the Registration Rights Agreement, the Company agreed to register with the Commission exchange notes (the “Exchange Notes”), having substantially identical terms as the Notes, as part of an offer to exchange freely tradable Exchange Notes for the Notes. The Company agreed to file a registration statement for the Exchange Notes no later than 180 days after November 1, 2004 and use its commercially reasonable efforts to cause that registration statement to be declared effective within 270 days after November 1, 2004 and to consummate the exchange offer no later than 310 days after November 1, 2004. The Company has also agreed, in specified circumstances, to file a shelf registration statement to cover resales of the Notes. The Company may be required to pay liquidated damages if it fails to comply with the registration and exchange requirements set forth in the Registration Rights Agreement.

On November 1, 2004, the Company also entered into new senior secured credit facility in an aggregate principal amount of $225 million, consisting of a $125 million revolving facility and a $100 million term facility (the “New Credit Facility”). Lehman Brothers Inc., one of the Initial Purchasers, acts as Joint Lead Arranger under the New Credit Facility. Lehman Commercial Paper Inc., an affiliate of Lehman Brothers Inc., acts as Administrative Agent, Collateral Agent and a lender under the New Credit Facility. Deutsche Bank Securities, Inc., an initial purchaser of the Notes, acts as Joint Lead Arranger and Syndication Agent and its affiliate Deutsche Bank AG, Cayman Islands branch, acts as a lender under the New Credit Facility. In connection with, and as collateral for borrowings under, the New Credit Facility, the Company also executed security certificates evidencing $63.0 million principal amount of the Company’s South Dakota Bonds and security certificates evidencing $162.0 million principal amount of the Company’s Montana Bonds.

Material terms and conditions of the New Credit Facility are described in Item 2.03 of this Current Report on Form 8-K.

The information contained in this Current Report on Form 8-K, including the exhibit hereto, does not constitute an offer to sell or the solicitation of an offer to buy the securities described herein, nor shall there be any sale of these securities in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities law of any such jurisdiction. The Notes and the Exchange Notes have not been registered under the Securities Act or the securities or blue sky laws of any jurisdiction and, unless registered, may not be offered or sold except pursuant to an applicable exemption from the registration requirements of the Securities Act and applicable securities laws of any other jurisdiction.

Item 1.02Termination of a Material Definitive Agreement.

As reported in a Current Report on Form 8-K filed with the Commission on October 26, 2004, on October 20, 2004, the United States Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”) entered an order confirming the Company’s Second Amended and Restated Plan of Reorganization (the “Plan”).  On November 1, 2004, the Plan became effective and the Company emerged from Chapter 11.

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On November 1, 2004, as one of the conditions to the Company’s emergence from Chapter 11, the Company collateralized in cash approximately $15 million of letters of credit initially issued under its Secured Superpriority Debtor-in-Possession Credit and Guaranty Agreement, dated as of September 19, 2003, among the Company, a Debtor and Debtor-in-Possession, as borrower, the other loan parties party thereto, as Guarantors, the lenders party thereto from time to time, and Bank One, NA (with its main office in Chicago, Illinois), as Initial Lender, Agent and LC Issuer (the “DIP Facility”) and terminated the DIP Facility.

In addition, on November 1, 2004, the Company used the net proceeds from the offering of its Notes (described in Item 2.03 below) and borrowings under the term portion of its New Credit Facility (described in Item 2.03 below), together with available cash, to repay and terminate its $390 million term loan facility agented by an affiliate of Credit Suisse First Boston LLC. In connection with the early termination of this term loan facility, the Company paid a prepayment premium of approximately $3.8 million.

Item 2.03Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

As discussed in Item 1.01 of this Current Report on Form 8-K, on November 1, 2004, the Company completed the sale of $225.0 million aggregate principal amount of its Notes. The Notes are collateralized by two series of existing first mortgage bonds secured by the Company’s regulated utility assets in Montana, South Dakota and Nebraska.  The maturity date of the Notes is November 1, 2014.

The Notes will mature on November 1, 2014 and will bear interest at the rate of 5.875% per year from and including the issue date, payable semi-annually, in arrears on May 1 and November 1 of each year, commencing May 1, 2005. The Notes are senior secured obligations of the Company, and rank: (i) equal in right of payment to all of the existing and future indebtedness and other obligations of the Company that are not, by their terms, expressly subordinated in right of payment to the Notes; (ii) senior in right of payment to all of the existing and future subordinated indebtedness of the Company; and (iii) structurally subordinated to all indebtedness and other liabilities of the subsidiaries of the Company.

The Company may redeem the Notes for cash, in whole or in part, at its option at any time on or after November 1, 2009, at redemption prices equal to 100% of the principal amount plus a premium declining ratably to par, together with accrued and unpaid interest and liquidated damages, if any, to the redemption date. In addition, at any time on or before November 1, 2007, the Company may, at its option and subject to certain requirements, use the cash proceeds from one or more qualified equity offerings by the Company to redeem up to 35% of the aggregate principal amount of the Notes issued under the Indenture at a redemption price equal to 105.875% of the principal amount, together with accrued and unpaid interest and liquidated damages, if any, thereon to the redemption date. If a change of control (as defined in the Indenture) occurs, the Company will be required to make an offer to purchase the Notes at 101% of the principal amount, together with accrued and unpaid interest and liquidated damages, if any, to, but not including, the change of control purchase date.

In addition to the terms of the Notes described above, the Indenture contains covenants, which are subject to limitations and exceptions, limiting the ability of the Company and its restricted

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subsidiaries to, among other things: (i) incur additional indebtedness; (ii) pay dividends or make distributions or certain other restricted payments; (iii) make certain investments; (iv) create liens on its assets to secure debt; (v) enter into sale and leaseback transactions; (vi) enter into transactions with affiliates; (vii) merge or consolidate with another company; (viii) sell, lease or otherwise dispose of all or substantially all of its assets; (ix) enter into new lines of business; and (x) guarantee indebtedness.

The Indenture also provides that, if an event of default occurs and is continuing, either the Note Trustee or the holders of at least 25% in aggregate principal amount of the Notes then outstanding may declare all principal, accrued interest and liquidated damages, if any, immediately due and payable, except that an event of default resulting from certain events of bankruptcy, insolvency or reorganization in respect of the Company or certain of its restricted subsidiaries will automatically cause all principal, accrued interest and liquidated damages, if any, to become immediately due and payable. Events of default include: (i) failure to pay any installment of interest (or liquidated damages, if any) on the Notes when due and payable and the continuance of any such failure for 30 days; (ii) failure to pay principal, or premium, if any, on the Notes when due and payable; (iii) failure to observe or perform any other covenant or agreement contained in the Notes or the Indenture and, subject to certain exceptions, the continuance of such failure for a period of 60 days after notice to the Company, (iv) certain events of bankruptcy, insolvency or reorganization in respect of the Company or certain of its subsidiaries; (v) certain defaults in indebtedness with an aggregate amount outstanding in excess of $50 million; and (vi) final unsatisfied judgments not covered by insurance aggregating in excess of $50 million, at any one time rendered against the Company us or any of its subsidiaries and not stayed, bonded or discharged within 60 days.

Also as discussed in Item 1.01 of this Current Report on Form 8-K, on November 1, 2004, the Company entered into a $225.0 million New Credit Facility providing for a $125.0 million revolving facility and a $100.0 million term facility.

The $125.0 million revolving facility will mature on November 1, 2009 and the $100.0 million term facility will mature on November 1, 2011. The Company will have to make quarterly amortizing payments equal to 1% per annum of the total amount of the term loan during each of the first six years after closing. The remaining balance amortizes quarterly during year seven. The revolver does not amortize.

The New Credit Facility is secured by first mortgage bonds issued under and secured as provided in the Company’s existing mortgage indentures. The first mortgage bonds constitute a first mortgage lien on substantially all of the Company’s utility property and rank pari passu with the first mortgage bonds securing the Notes.

The revolving facility will initially to bear interest at a rate equal to LIBOR plus 1.75% per annum, or at a base rate plus 0.75% per annum. The term loan will bear interest at a rate equal to LIBOR plus 1.75% per annum, or at a base rate plus 0.75% per annum. Base rate loans will be paid quarterly in arrears. LIBOR loans will be paid on the last day of each relevant interest period and, in the case of any interest period longer than three months, on each successive date three months after the first day of such interest period.

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In addition to the terms of the New Credit Agreement described above, the New Credit Agreement contains covenants, which are subject to limitations and exceptions, limiting the ability of the Company and its restricted subsidiaries to, among other things: (i) incur additional indebtedness; (ii) create liens; (iii) engage in any consolidation or merger or otherwise liquidate or dissolve; (iv) dispose of property; (v) make restricted payments; (vi) make loans or advances; and (vii) enter into transactions with affiliates.

The New Credit Facility also provides that, if an event of default occurs and is continuing, the administrative agent may terminate the revolving loan commitments and declare all principal and accrued interest immediately due and payable, except that an event of default resulting from certain events of bankruptcy, insolvency or reorganization in respect of the Company or certain of its restricted subsidiaries will automatically cause all revolving loan commitments to terminate and all principal and accrued interest to become immediately due and payable. Events of default include: (i) failure to pay any installment of interest under the New Credit Facility when due and payable and the continuance of any such failure for five days; (ii) failure to pay principal, or premium, if any, under the New Credit Facility when due and payable; (iii) failure to observe or perform any of the negative covenants contained in the New Credit Facility or the covenants relating to the conduct of business and maintenance of existence of the Company; (iv) failure to observe or perform any other covenant or agreement contained in the New Credit Facility and, subject to certain exceptions, the continuance of such failure for a period of 30 days (iv) certain events of bankruptcy, insolvency or reorganization in respect of the Company or certain of its subsidiaries; (v) certain defaults in indebtedness with an aggregate amount outstanding in excess of $15 million; (vi) final unsatisfied judgments not covered by insurance aggregating in excess of $15 million, at any one time rendered against the Company us or any of its subsidiaries and not stayed, bonded or discharged within 60 days; (vii) prohibited transactions, accumulated funding deficiencies or reportable events occur under ERISA that could reasonably cause a material adverse effect to the Company; (viii) failure of any of the security documents comprising the lien of the New Credit Facility to be enforceable and of the same effect and priority intended to be created thereby; (x) the occurrence of an event of default under the Company’s mortgage bond indentures or under the indenture governing the Notes; (xi) the occurrence of a change in control (as defined in the New Credit Facility); and (xii) any change to the confirmation order entered by the Bankruptcy Court that could reasonably be expected to materially and adversely affect the lenders or the Company’s ability to perform its obligations under the New Credit Facility.

For additional information, Item 7.01 of this Current Report on Form 8-K.

Item 7.01Regulation FD Disclosure.

On November 1, 2004, the Company issued a press release announcing that it had emerged from Chapter 11, a copy of which is attached hereto as Exhibit 99.1 and incorporated herein by reference.

On November 1, 2004, the Company also issued a press release announcing the closing of the offering and sale of the Notes, a copy of which is attached hereto as Exhibit 99.2 and incorporated herein by reference.

On November 1, 2004, the Company also issued a press release announcing the election of Dr. E. Linn Draper as the Chairman of its Board of Directors and the appointment of the

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members of an Audit Committee, a Human Resources Committee and a Governance Committee, a copy of which is attached hereto as Exhibit 99.3 and incorporated herein by reference.

The information furnished in this Item 7.01 shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section. Such information may only be incorporated by reference in another filing under the Exchange Act or the Securities Act of 1933, as amended, if such subsequent filing specifically references such information.

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Item 9.01Financial Statements and Exhibits.

EXHIBIT NO.	DESCRIPTION OF DOCUMENT
4.1*	Indenture, dated as of November 1, 2004, between NorthWestern Corporation and U.S. Bank National Association, as trustee.
4.2*	Supplemental Indenture No. 1, dated as of November 1, 2004, by and between NorthWestern Corporation and U.S. Bank National Association, as trustee.
4.3*	Registration Rights Agreement, dated as of November 1, 2004, between NorthWestern Corporation, as issuer, and Credit Suisse First Boston LLC and Lehman Brothers Inc., as representatives of the several initial purchasers.
4.4*	Twenty-Fourth Supplemental Indenture, dated as of November 1, 2004, between NorthWestern Corporation and The Bank of New York (successor to Morgan Guaranty Trust Company of New York (formerly Guaranty Trust Company of New York)), and MaryBeth Lewicki, (successor Co-Trustee to Douglas J. MacInnes, Arthur E. Burke, Karl R. Henrich, H.H. Gould, R. Amundsen, P.J. Crowley and W.T. Cunningham), as Trustees under the Mortgage and Deed of Trust, dated as of October 1, 1945, which was executed and delivered by The Montana Power Company, a corporation of the State of New Jersey (hereinafter called the “Company-New Jersey”), as indirect predecessor under the Mortgage to the Company (the Company being successor under the Mortgage to NorthWestern Energy, L.L.C. (hereinafter called “NorthWestern Energy”), formerly known as The Montana Power, L.L.C., a limited liability company of the State of Montana, and NorthWestern Energy being the successor under the Mortgage to The Montana Power Company, a corporation of the State of Montana (hereinafter called the “Company-Montana”)), to Guaranty Trust Company of New York and Arthur E. Burke, as Trustees.
4.5*	Supplemental Indenture, dated as of November 1, 2004, by and between NorthWestern Corporation (formerly known as Northwestern Public Service Company) and JPMorgan Chase Bank (successor by merger to The Chase Manhattan Bank (National Association)), as Trustee under the General Mortgage Indenture and Deed of Trust dated as of August 1, 1993.
99.1*	Credit Agreement among NorthWestern Corporation, as borrower, the several lenders from time to time parties thereto, Lehman Brothers Inc. and Deutsche Bank Securities Inc., as joint lead arrangers, Deutsche Bank Securities Inc., as syndication agent, Union Bank of California, N.A. and KeyBank National Association, s co-documentation agents, and Lehman Commercial Paper Inc., as administrative agent and collateral agent.
99.2*	Press Release of NorthWestern Corporation dated November 1, 2004 regarding emergence from Chapter 11.
99.3*	Press Release of NorthWestern Corporation dated November 1, 2004 regarding closing of Notes and Credit Agreement financings.
99.4*	Press Release of NorthWestern Corporation dated November 1, 2004 regarding Board of Directors actions.

* filed herewith

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	NorthWestern Corporation
	By:
		Thomas J. Knapp
		Vice President and Deputy General Counsel
Date: November 5, 2004

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Index to Exhibits

EXHIBIT NO.	DESCRIPTION OF DOCUMENT
4.1*	Indenture, dated as of November 1, 2004, between NorthWestern Corporation and U.S. Bank National Association, as trustee.
4.2*	Supplemental Indenture No. 1, dated as of November 1, 2004, by and between NorthWestern Corporation and U.S. Bank National Association, as trustee.
4.3*	Registration Rights Agreement, dated as of November 1, 2004, between NorthWestern Corporation, as issuer, and Credit Suisse First Boston LLC and Lehman Brothers Inc., as representatives of the several initial purchasers.
4.4*	Twenty-Fourth Supplemental Indenture, dated as of November 1, 2004, between NorthWestern Corporation and The Bank of New York (successor to Morgan Guaranty Trust Company of New York (formerly Guaranty Trust Company of New York)), and MaryBeth Lewicki, (successor Co-Trustee to Douglas J. MacInnes, Arthur E. Burke, Karl R. Henrich, H.H. Gould, R. Amundsen, P.J. Crowley and W.T. Cunningham), as Trustees under the Mortgage and Deed of Trust, dated as of October 1, 1945, which was executed and delivered by The Montana Power Company, a corporation of the State of New Jersey (hereinafter called the “Company-New Jersey”), as indirect predecessor under the Mortgage to the Company (the Company being successor under the Mortgage to NorthWestern Energy, L.L.C. (hereinafter called “NorthWestern Energy”), formerly known as The Montana Power, L.L.C., a limited liability company of the State of Montana, and NorthWestern Energy being the successor under the Mortgage to The Montana Power Company, a corporation of the State of Montana (hereinafter called the “Company-Montana”)), to Guaranty Trust Company of New York and Arthur E. Burke, as Trustees.
4.5*	Supplemental Indenture, dated as of November 1, 2004, by and between NorthWestern Corporation (formerly known as Northwestern Public Service Company) and JPMorgan Chase Bank (successor by merger to The Chase Manhattan Bank (National Association)), as Trustee under the General Mortgage Indenture and Deed of Trust dated as of August 1, 1993.
99.1*	Credit Agreement among NorthWestern Corporation, as borrower, the several lenders from time to time parties thereto, Lehman Brothers Inc. and Deutsche Bank Securities Inc., as joint lead arrangers, Deutsche Bank Securities Inc., as syndication agent, Union Bank of California, N.A. and KeyBank National Association, s co-documentation agents, and Lehman Commercial Paper Inc., as administrative agent and collateral agent.
99.2*	Press Release of NorthWestern Corporation dated November 1, 2004 regarding emergence from Chapter 11.
99.3*	Press Release of NorthWestern Corporation dated November 1, 2004 regarding closing of Notes and Credit Agreement financings.
99.4*	Press Release of NorthWestern Corporation dated November 1, 2004 regarding Board of Directors actions.

* filed herewith

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EX-4.1

Exhibit 4.1

NORTHWESTERN CORPORATION

TO

U.S. BANK NATIONAL ASSOCIATION

Trustee

Indenture

Dated as of November 1, 2004

NORTHWESTERN CORPORATION

Reconciliation and Tie between Trust Indenture Act of 1939 and Indenture, dated as of November 1, 2004

Trust Indenture Act Section	Indenture Section(s)
§310(a)(1)	809
(a)(2)	809
(a)(3)	Not Applicable
(a)(4)	Not Applicable
(b)	808, 810
§311(a)	813
(b)	813
(c)	813
§312(a)	901
(b)	901
(c)	901
§313(a)	902
(b)	902
(c)	902
(d)	902
§314(a)	902, 505
(b)	321
(c)(1)	102
(c)(2)	102
(c)(3)	Not Applicable
(d)	312, 315, 318
(e)	102
§315(a)	801, 803
(b)	802
(c)	801
(d)	801
(e)	714
§316(a)	712, 713
(a)(1)(A)	702, 712
(a)(1)(B)	713
(a)(2)	Not Applicable
(b)	708
(c)	104
§317(a)(1)	703
(a)(2)	705
(b)	503
§318(a)	107

TABLE OF CONTENTS

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SECTION 316. No Transfer of First Mortgage Bonds.

SECTION 317. Voting of First Mortgage Bonds.

SECTION 318. Experts’ Certificates.

SECTION 319. No Modification of First Mortgage Bonds by Indenture.

SECTION 320. Other Responsibilities of Trustee With Respect to First Mortgage Bonds.

SECTION 321. Further Assurances.

ARTICLE FOUR REDEMPTION OF SECURITIES

SECTION 401. Applicability of Article.

SECTION 402. Election to Redeem; Notice to Trustee.

SECTION 403. Selection of Securities to Be Redeemed.

SECTION 404. Notice of Redemption.

SECTION 405. Securities Payable on Redemption Date.

SECTION 406. Securities Redeemed in Part.

ARTICLE FIVE COVENANTS

SECTION 501. Payment of Securities.

SECTION 502. Maintenance of Office or Agency.

SECTION 503. Money for Securities Payments to Be Held in Trust.

SECTION 504. Corporate Existence.

SECTION 505. Annual Officer’s Certificates to Compliance.

SECTION 506. Maintenance of Properties.

SECTION 507. Payment of Taxes and Other Claims.

SECTION 508. Waiver of Certain Covenants.

ARTICLE SIX DEFEASANCE, SATISFACTION AND DISCHARGE

SECTION 601. Option to Effect Legal Defeasance or Covenant Defeasance.

SECTION 602. Legal Defeasance and Discharge.

SECTION 603. Covenant Defeasance.

SECTION 604. Conditions to Legal or Covenant Defeasance.

SECTION 605. Miscellaneous Provisions

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SECTION 606. Reinstatement.

SECTION 607. Satisfaction and Discharge of Indenture.

SECTION 608. Application of Trust Money.

ARTICLE SEVEN EVENTS OF DEFAULT; REMEDIES

SECTION 701. Events of Default.

SECTION 702. Acceleration of Maturity; Rescission and Annulment.

SECTION 703. Collection of Indebtedness and Suits for Enforcement by Trustee.

SECTION 704. Application of Money Collected.

SECTION 705. Trustee May File Proofs of Claim.

SECTION 706. Trustee May Enforce Claims without Possession of Securities.

SECTION 707. Limitation on Suits.

SECTION 708. Unconditional Right of Holders to Receive Principal, Premium and Interest.

SECTION 709. Restoration of Rights and Remedies.

SECTION 710. Rights and Remedies Cumulative.

SECTION 711. Delay or Omission Not Waiver.

SECTION 712. Control by Holders of Securities.

SECTION 713. Waiver of Past Defaults.

SECTION 714. Undertaking for Costs.

SECTION 715. Waiver of Stay or Extension Laws.

SECTION 716. Defaults under Mortgages.

ARTICLE EIGHT THE TRUSTEE

SECTION 801. Certain Duties and Responsibilities.

SECTION 802. Notice of Defaults.

SECTION 803. Certain Rights of Trustee.

SECTION 804. Not Responsible for Recitals or Issuance of Securities.

SECTION 805. May Hold Securities.

SECTION 806. Money Held in Trust.

SECTION 807. Compensation and Reimbursement.

SECTION 808. Disqualification; Conflicting Interests.

SECTION 809. Corporate Trustee Required; Eligibility.

SECTION 810. Resignation and Removal; Appointment of Successor.

SECTION 811. Acceptance of Appointment by Successor.

SECTION 812. Merger, Conversion, Consolidation or Succession to Business.

SECTION 813. Preferential Collection of Claims against Company.

SECTION 814. Appointment of Authenticating Agent.

SECTION 815. Co-trustee and Separate Trustees.

ARTICLE NINE LISTS OF HOLDERS; REPORTS BY TRUSTEE AND COMPANY

SECTION 901. Lists of Holders.

SECTION 902. Reports by Trustee and Company.

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ARTICLE TEN CONSOLIDATION, MERGER, CONVEYANCE OR OTHER TRANSFER

SECTION 1001. Company may Consolidate, etc., Only on Certain Terms.

SECTION 1002. Successor Substituted.

SECTION 1003. Merger into Company.

ARTICLE ELEVEN SUPPLEMENTAL INDENTURES

SECTION 1101. Supplemental Indentures without Consent of Holders.

SECTION 1102. Supplemental Indentures with Consent of Holders.

SECTION 1103. Execution of Supplemental Indentures.

SECTION 1104. Effect of Supplemental Indentures.

SECTION 1105. Conformity with Trust Indenture Act.

SECTION 1106. Reference in Securities to Supplemental Indentures.

SECTION 1107. Modification without Supplemental Indenture.

ARTICLE TWELVE MEETINGS OF HOLDERS; ACTION WITHOUT MEETING

SECTION 1201. Purposes for Which Meetings May Be Called.

SECTION 1202. Call, Notice and Place of Meetings.

SECTION 1203. Persons Entitled to Vote at Meetings.

SECTION 1204. Quorum; Action.

SECTION 1205. Attendance at Meetings; Determination of Voting Rights; Conduct and Adjournment of Meetings.

SECTION 1206. Counting Votes and Recording Action of Meetings.

SECTION 1207. Action without Meeting.

ARTICLE THIRTEEN IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS

SECTION 1301. Liability Solely Corporate.

Signatures

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INDENTURE, dated as of November 1, 2004, between NORTHWESTERN CORPORATION, a corporation organized and existing under the laws of the State of Delaware (hereinafter sometimes called the “Company”), and U.S. Bank National Association, a national banking association, as trustee (hereinafter sometimes called the “Trustee”).

Recitals of the Company

The Company has duly authorized the execution and delivery of this Indenture to provide for the issuance from time to time of debentures, notes or other evidences of indebtedness (herein called the “Securities”), to be issued in one or more series as contemplated herein; all acts necessary to make this Indenture a valid agreement of the Company have been performed.

NOW, THEREFORE, THIS INDENTURE WITNESSETH that, in consideration of the premises and of the purchase of the Securities by the Holders thereof, it is hereby covenanted and agreed by and between the Company and the Trustee that all the Securities are to be authenticated and delivered subject to the further covenants, conditions and trusts hereinafter set forth, and the Company hereby covenants and agrees to and with the Trustee, for the equal and ratable benefit of all Holders of the Securities or of series thereof (except as otherwise contemplated herein), as follows:

ARTICLE ONE

Definitions and Other Provisions of General Application

SECTION 101.    General Definitions.

For all purposes of this Indenture, except as otherwise expressly provided or unless the context otherwise requires:

(a)   the terms defined in this Article have the meanings assigned to them in this Article and include the plural as well as the singular;

(b)   all terms used herein without definition which are defined in the Trust Indenture Act, either directly or by reference therein, have the meanings assigned to them therein;

(c)   all terms used herein without definition which are defined in the Uniform Commercial Code as in effect in any jurisdiction in which any property of the Company is located shall have the meanings assigned to them therein with respect to such property;

(d)   all accounting terms not otherwise defined herein have the meanings assigned to them in accordance with generally accepted accounting principles in the United States; and, except as otherwise herein expressly provided, the term “generally accepted accounting principles” with respect to any computation required or permitted hereunder shall mean such accounting principles as are generally accepted in the United States at the date of such computation or, at the election of the Company from time to time, at the date of the execution and delivery of this Indenture; provided, however, that in determining generally

accepted accounting principles applicable to the Company, effect shall be given, to the extent required, to any order, rule or regulation of any administrative agency, regulatory authority or other governmental body having jurisdiction over the Company; and

(e)   the words “herein”, “hereof” and “hereunder” and other words of similar import refer to this Indenture as a whole and not to any particular Article, Section or other subdivision.

“Act”, when used with respect to any Holder of a Security, has the meaning specified in Section 104.

“Affiliate” of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person.  For purposes of this definition, “control,” as used with respect to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by agreement or otherwise; provided that beneficial ownership of 10% or more of the Voting Stock of a Person will be deemed to be control.  For purposes of this definition, the terms “controlling,” and “controlled by” and “under common control with” have correlative meanings.

“Applicable Basis” has the meaning assigned to that term in Section 314.

“Appraiser” means a Person engaged in the business of appraising property or otherwise qualified to pass upon the fair value or fair market value of property, who, unless required to be Independent, may be an employee of the Company.

“Authenticating Agent” means any Person (other than the Company or an Affiliate of the Company) authorized by the Trustee to act on behalf of the Trustee to authenticate the Securities of one or more series.

“Authorized Officer” means the Chairman of the Board, the President, any Vice President, the Chief Executive Officer, the Chief Operating Officer, the Chief Financial Officer, the Treasurer, any Assistant Treasurer, the Corporate Secretary or any Assistant Corporate Secretary or any other duly authorized officer, agent or attorney-in-fact of the Company named in an Officer’s Certificate signed by any of such corporate officers or authorized pursuant to a Board Resolution.

“Board of Directors” means:

(1)           with respect to a corporation, the board of directors of the corporation or any committee of such board of directors duly authorized to act for the corporation;

(2)           with respect to a partnership, the Board of Directors of the general partner of the partnership;

(3)           with respect to a limited liability company, the managing member or members or any controlling committee of managing members thereof; and

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(4)           with respect to any other Person, the board or committee of such Person serving a similar function.

“Board Resolution” means a copy of a resolution certified by the Corporate Secretary or an Assistant Corporate Secretary of the Company to have been duly adopted by the Board of Directors and to be in full force and effect on the date of such certification, and delivered to the Trustee; and when used with respect to this definition of “Board Resolution,” “Board of Directors” means either the board of directors of the Company or any committee thereof duly authorized to act in respect of matters relating to this Indenture.

“Business Day”, when used with respect to a Place of Payment or any other particular location specified in the Securities or this Indenture, means any day, other than a Saturday or Sunday, which is not a day on which banking institutions or trust companies in such Place of Payment or other location are generally authorized or required by law, regulation or executive order to remain closed, except as may be otherwise specified as contemplated by Section 301.

“Capital Stock” means:

(1)           in the case of a corporation, corporate stock;

(2)           in the case of an association or business entity, any and all shares, interests, participations, rights or other equivalents (however designated) of corporate stock;

(3)           in the case of a partnership or limited liability company, partnership or membership interests (whether general or limited); and

(4)           any other interest or participation that confers on a Person the right to receive a share of the profits and losses of, or distributions of assets of, the issuing Person.

“Cash Equivalents” has the meaning specified in Section 114.

“Commission” means the Securities and Exchange Commission, as from time to time constituted, created under the Securities Exchange Act of 1934, as amended, or, if at any time after the date of the execution and delivery of this Indenture such Commission is not existing and performing the duties now assigned to it under the Trust Indenture Act, then the body, if any, performing such duties at such time.

“Company” means the Person named as the “Company” in the first paragraph of this Indenture until a successor Person shall have become such pursuant to the applicable provisions of this Indenture, and thereafter “Company” shall mean such successor Person.

“Company Order” or “Company Request” means a written request or order signed in the name of the Company by an Authorized Officer and delivered to the Trustee.

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“Corporate Trust Office” means the office of the Trustee at which at any particular time its corporate trust business shall be principally administered, which office at the date of the execution and delivery of this Indenture is located at 100 Wall Street, New York, New York  10005.

“corporation” means a corporation or, except for purposes of Section 1001(a), an association, company, joint stock company or business trust.

“Customary Exceptions” means, with respect to any Opinion of Counsel required to be delivered hereunder, such exceptions to opinions as are customarily expressed in opinions of counsel rendered in connection with similar transactions at the time such Opinion of Counsel is to be delivered and, in any event, shall include exceptions based upon limitations imposed by (a) bankruptcy, insolvency, reorganization, moratorium or other laws affecting the enforcement of creditors’ rights, and (b) general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law).

“Defaulted Interest” has the meaning specified in Section 307.

“Discount Security” means any Security which provides for an amount less than the principal amount thereof to be due and payable upon a declaration of acceleration of the Maturity thereof pursuant to Section 702.

“Dollar” or “$” means a dollar or other equivalent unit in such coin or currency of the United States as at the time shall be legal tender for the payment of public and private debts.

“Eligible Obligations” means:

(a)           with respect to Securities denominated in Dollars, Government Obligations; or

(b)           with respect to Securities denominated in a currency other than Dollars or in a composite currency, such other obligations or instruments as shall be specified with respect to such Securities as contemplated by Section 301.

“Engineer” means a Person engaged in the engineering profession or otherwise qualified to pass upon engineering matters (including, but not limited to, a Person licensed as a professional engineer, whether or not then engaged in the engineering profession), who, unless required to be Independent, may be an employee of the Company.

“Event of Default” has the meaning specified in Section 701.

“Exchange Act” means the Securities Act of 1934 and the rules and regulations promulgated thereunder, as amended from time to time.

“Expert” means a Person which is an Engineer, Appraiser or other expert and which, with respect to any certificate to be signed by such Person and delivered to the Trustee, is

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qualified to pass upon the matter set forth in such certificate, who, unless required to be Independent, may be an employee of the Company.

“Expert’s Certificate” means a certificate signed by an Expert (which if required to be “Independent” shall be selected either by the Board of Directors or by an Authorized Officer of the Company, such selection to be conclusively evidenced by a Board Resolution or an Officer’s Certificate) and delivered to the Trustee.  An Expert’s Certificate of an Expert who is Independent is sometimes referred to herein as an “Independent Expert’s Certificate”.

“First Mortgage Bonds” means bonds or other obligations now or hereafter issued and Outstanding under either Mortgage.

“Governmental Authority” means the government of the United States or of any State or Territory thereof or of the District of Columbia or of any county, municipality or other political subdivision of any thereof, or any department, agency, authority or other instrumentality of any of the foregoing.

“Government Obligations” means:

(a)           direct obligations of, or obligations the principal of and interest on which are unconditionally guaranteed by, the United States which are entitled to the benefit of the full faith and credit thereof; and

(b)           certificates, depositary receipts or other instruments which evidence a direct ownership interest in obligations described in clause (a) above or in any specific interest or principal payments due in respect thereof; provided, however, that the custodian of such obligations or specific interest or principal payments shall be a bank or trust company (which may include the Trustee or any Paying Agent) subject to Federal or State supervision or examination with a combined capital and surplus of at least One Hundred Million Dollars ($100,000,000); and provided, further, that except as may be otherwise required by law, such custodian shall be obligated to pay to the holders of such certificates, depositary receipts or other instruments the full amount received by such custodian in respect of such obligations or specific payments and shall not be permitted to make any deduction therefrom.

“Holder” means a Person in whose name a Security is registered in the Security Register.

“Indenture” means this instrument as originally executed and delivered and as it may from time to time be amended and/or supplemented by one or more indentures or other instruments supplemental hereto entered into pursuant to the applicable provisions hereof and shall include the terms of particular series of Securities established as contemplated by Section 301.

“Independent”, when applied to any Expert, means such a Person who (a) is in fact independent, (b) does not have any material financial interest in any obligor upon the Securities or in any Affiliate of any such obligor, (c) is not connected with any such obligor as an

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officer, employee, promoter, underwriter, trustee, partner, director or any person performing similar functions and (d) is approved by the Trustee in the exercise of reasonable care.

“interest” with respect to a Discount Security means interest, if any, borne by such Security at a Stated Interest Rate, rather than interest calculated at any imputed rate.

“Interest Payment Date”, when used with respect to any Security, means the Stated Maturity of an installment of interest on such Security.

“Lien” means any mortgage, deed of trust, pledge, security interest, encumbrance, easement, lease, reservation, restriction, servitude, charge or similar right and any other lien of any kind, whether or not filed, recorded or otherwise perfected under applicable law, including, without limitation, any conditional sale or other title retention agreement, any lease in the nature thereof and any option or other agreement to sell or give a security interest in and any filing of or agreement to give any financing statement under the Uniform Commercial Code (or equivalent statutes) of any jurisdiction.

“Maturity”, when used with respect to any Security, means the date on which the principal of such Security or an installment of principal becomes due and payable as provided in such Security or in this Indenture, whether at the Stated Maturity, by declaration of acceleration, upon call for redemption or otherwise.

“Montana Mortgage” means the Mortgage and Deed of Trust, dated as of October 1, 1945, of the Company (successor thereunder to NorthWestern Energy, L.L.C., in turn successor thereunder to The Montana Power Company) to The Bank of New York (successor thereunder to Guaranty Trust Company of New York) and Mary Beth Lewicki (successor thereunder to Arthur E. Burke), as trustees (collectively with each other and with their respective successors in such capacity, the “Montana Mortgage Trustee”), as such indenture has been heretofore and is hereafter amended and supplemented.

“Mortgage” means the Montana Mortgage or the South Dakota Mortgage.

“Mortgage Trustee” means, with respect to the Montana Mortgage, the Montana Mortgage Trustee, and with respect to the South Dakota Mortgage, the South Dakota Mortgage Trustee.

“Notice of Default” has the meaning specified in Section 701.

“Officer’s Certificate” means a certificate signed by an Authorized Officer and delivered to the Trustee.

“Opinion of Counsel” means a written opinion of counsel, who may be counsel for the Company or other counsel reasonably acceptable to the Trustee, and who may be an employee or Affiliate of the Company.

“Outstanding”, when used with respect to Securities, means, as of the date of determination, all Securities theretofore authenticated and delivered under this Indenture, except:

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(a)           Securities theretofore canceled or delivered to the Trustee for cancellation;

(b)           Securities, or portions thereof, for whose payment or redemption or repayment at the option of the Holder money in the necessary amount has been theretofore deposited with the Trustee or any Paying Agent (other than the Company) in trust or set aside and segregated in trust by the Company (if the Company shall act as its own Paying Agent) for the Holders of such Securities; provided that, if such Securities are to be redeemed, notice of such redemption has been duly given pursuant to this Indenture or provision therefor satisfactory to the Trustee has been made;

(c)           Securities, except to the extent provided in Sections 602 and 603, with respect to which the Company has effected legal defeasance and/or covenant defeasance as provided in Article Six; and

(d)           Securities which have been paid pursuant to Section 306 or in exchange for or in lieu of which other Securities have been authenticated and delivered pursuant to this Indenture, other than any such Securities in respect of which there shall have been presented to the Trustee proof satisfactory to it and the Company that such Securities are held by a bona fide purchaser or purchasers in whose hands such Securities are valid obligations of the Company;

provided, however, that in determining whether or not the Holders of the requisite principal amount of the Securities Outstanding under this Indenture, or the Outstanding Securities of any series or Tranche, have given or made any request, demand, authorization, direction, notice, consent or waiver hereunder or whether or not a quorum is present at a meeting of Holders of Securities,

(x)            Securities owned by the Company or any other obligor upon the Securities or any Affiliate of the Company or of such other obligor (unless the Company, such obligor or such Affiliate owns all Securities Outstanding under this Indenture, or all Outstanding Securities of each such series and each such Tranche, as the case may be, determined without regard to this clause (x)) shall be disregarded and deemed not to be Outstanding, except that, in determining whether the Trustee shall be protected in relying upon any such request, demand, authorization, direction, notice, consent or waiver or upon any such determination as to the presence of a quorum, only Securities which the Trustee knows to be so owned shall be so disregarded; provided, however, that Securities so owned which have been pledged in good faith may be regarded as Outstanding if it is established to the reasonable satisfaction of the Trustee that the pledgee, and not the Company, any such other obligor or Affiliate of either thereof, has the right so to act with respect to such Securities and that the pledgee is not the Company or any other obligor upon the Securities or any Affiliate of the Company or of such other obligor; and

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(y)           the principal amount of a Discount Security that shall be deemed to be Outstanding for such purposes shall be the amount of the principal thereof that would be due and payable as of the date of such determination upon a declaration of acceleration of the Maturity thereof pursuant to Section 702; and

provided, further, that, in the case of any Security the principal of which is payable from time to time without presentment or surrender, the principal amount of such Security that shall be deemed to be Outstanding at any time for all purposes of this Indenture shall be the original principal amount thereof less the aggregate amount of principal thereof theretofore paid.

“Outstanding”, when used with respect to First Mortgage Bonds, has the meaning specified in the related Mortgage.

“Paying Agent”means any Person, including the Company, authorized by the Company to pay the principal of and premium, if any, or interest, if any, on any Securities on behalf of the Company.

“Periodic Offering” means an offering of Securities of a series from time to time any or all of the specific terms of which Securities, including without limitation the rate or rates of interest, if any, thereon, the Stated Maturity or Maturities thereof and the redemption provisions, if any, with respect thereto, are to be determined by the Company or its agents from time to time subsequent to the initial request for the authentication and delivery of such Securities by the Trustee, all as contemplated in Section 301 and clause (b) of Section 303.

“Person” means any individual, corporation, partnership, joint venture, association, joint-stock company, trust, unincorporated organization, limited liability company or government or other entity.

“Place of Payment”, when used with respect to the Securities of any series, or any Tranche thereof, means the place or places, specified as contemplated by Section 301, at which, subject to Section 502, principal of and premium, if any, and interest, if any, on the Securities of such series or Tranche are payable.

“Predecessor Security” of any particular Security means every previous Security evidencing all or a portion of the same debt as that evidenced by such particular Security; and, for the purposes of this definition, any Security authenticated and delivered under Section 306 in exchange for or in lieu of a mutilated, destroyed, lost or stolen Security shall be deemed (to the extent lawful) to evidence the same debt as the mutilated, destroyed, lost or stolen Security.

“Redemption Date”, when used with respect to any Security to be redeemed, means the date fixed for such redemption by or pursuant to this Indenture.

“Redemption Price”, when used with respect to any Security to be redeemed, means the price at which it is to be redeemed pursuant to this Indenture.

“Regular Record Date” for the interest payable on any Interest Payment Date on the Securities of any series means the date specified for that purpose as contemplated by Section 301.

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“Required Currency” has the meaning specified in Section 311.

“Responsible Officer”, when used with respect to the Trustee, means any officer of the Trustee assigned by the Trustee to administer its corporate trust matters.

“Restricted Subsidiary” when used with respect to the Securities of any series means the Persons specified as such as contemplated by Section 301 with respect to such series.

“Securities” means any bonds, notes and other evidences of indebtedness authenticated and delivered under this Indenture.

“Security Register” and “Security Registrar” have the respective meanings specified in Section 305.

“South Dakota Mortgage” means the General Mortgage Indenture and Deed of Trust, dated as of August 1, 1993, of the Company to JPMorgan Chase Bank (as successor thereunder to The Chase Manhattan Bank (National Association)), as trustee (together with its successors in such capacity, the “South Dakota Mortgage Trustee”), as such indenture has been heretofore and is hereafter amended and supplemented.

“Special Record Date” for the payment of any Defaulted Interest on the Securities of any series means a date fixed by the Trustee pursuant to Section 307.

“Stated Interest Rate” means a rate (whether fixed or variable) at which an obligation by its terms is stated to bear simple interest.  Any calculation or other determination to be made under this Indenture by reference to the Stated Interest Rate on an obligation shall be made (a) if the Company’s obligations in respect of any other indebtedness shall be evidenced or secured in whole or in part by such obligation, by reference to the lower of the Stated Interest Rate on such obligation and the Stated Interest Rate on such other indebtedness and (b) without regard to the effective interest cost to the Company of such obligation or of any such other indebtedness.

“Stated Maturity”, when used with respect to any obligation or any installment of principal thereof or interest thereon, means the date on which the principal of such obligation or such installment of principal or interest is stated to be due and payable (without regard to any provisions for redemption, prepayment, acceleration, purchase or extension).

“Successor” has the meaning set forth in Section 1001.

“Tranche” means a group of Securities which (a) are of the same series and (b) have identical terms except as to principal amount and/or date of issuance.

“Trustee” means the Person named as the “Trustee” in the first paragraph of this Indenture until a successor trustee shall have become such with respect to one or more series of Securities pursuant to the applicable provisions of this Indenture, and thereafter “Trustee” shall mean or include each Person who is then a Trustee hereunder, and, if at any time there is more than one Person acting as trustee hereunder, “Trustee” shall mean each such Person so acting.

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“Trust Indenture Act” means, the Trust Indenture Act of 1939, and the rules and regulations promulgated thereunder, as in force at the date of this Indenture, or if this Indenture is first qualified under said Act after the first issuance of Securities, as in force at the date of such qualification.

“United States” means the United States of America, its Territories, its possessions and other areas subject to its political jurisdiction.

“Voting Stock” of any Person as of any date means the Capital Stock of such Person that is at the time entitled to vote in the election of the Board of Directors of such Person.

SECTION 102.    Compliance Certificates and Opinions.

(a)   Except as otherwise expressly provided in this Indenture, upon any application or request by the Company to the Trustee to take any action under any provision of this Indenture, the Company shall furnish to the Trustee an Officer’s Certificate stating that all conditions precedent, if any, provided for in this Indenture relating to the proposed action have been complied with and an Opinion of Counsel stating that in the opinion of such counsel all such conditions precedent, if any, have been complied with, it being understood that in the case of any such application or request as to which the furnishing of such documents is specifically required by any provision of this Indenture relating to such particular application or request, no additional certificate or opinion need be furnished.

(b)   Every certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture shall include:

(i)            a statement that each individual signing such certificate or opinion has read such covenant or condition and the definitions herein relating thereto;

(ii)           a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based;

(iii)          a statement that, in the opinion of each such individual, such individual has made such examination or investigation as is necessary to enable such individual to express an informed opinion as to whether or not such covenant or condition has been complied with; and

(iv)          a statement as to whether, in the opinion of each such individual, such condition or covenant has been complied with.

SECTION 103.    Content and Form of Documents Delivered to Trustee.

(a)   Any Officer’s Certificate may be based (without further examination or investigation), insofar as it relates to or is dependent upon legal matters, upon an opinion of, or representations by, counsel, unless, in any case, such officer has actual knowledge that the certificate or opinion or representations with respect to the matters upon which such Officer’s Certificate may be based as aforesaid are erroneous.

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Any Opinion of Counsel may be based (without further examination or investigation), insofar as it relates to or is dependent upon factual matters, information with respect to which is in the possession of the Company, upon a certificate of, or representations by, an officer or officers of the Company, unless such counsel has actual knowledge that the certificate or opinion or representations with respect to the matters upon which his opinion may be based as aforesaid are erroneous.  In addition, any Opinion of Counsel may be based (without further examination or investigation), insofar as it relates to or is dependent upon matters covered in an Opinion of Counsel rendered by other counsel, upon such other Opinion of Counsel, unless such counsel has actual knowledge that the Opinion of Counsel rendered by such other counsel with respect to the matters upon which his Opinion of Counsel may be based as aforesaid are erroneous.  If, in order to render any Opinion of Counsel provided for herein, the signer thereof shall deem it necessary that additional facts or matters be stated in any Officer’s Certificate provided for herein, then such certificate may state all such additional facts or matters as the signer of such Opinion of Counsel may request.

(b)   In any case where several matters are required to be certified by, or covered by an opinion of, any specified Person, it is not necessary that all such matters be certified by, or covered by the opinion of, only one such Person, or that they be so certified or covered by only one document, but one such Person may certify or give an opinion with respect to some matters and one or more other such Persons as to other matters, and any such Person may certify or give an opinion as to such matters in one or several documents.  Where any Person is required to make, give or execute two or more applications, requests, consents, certificates, statements, opinions or other instruments under this Indenture, they may, but need not, be consolidated and form one instrument.

(c)   Whenever, subsequent to the receipt by the Trustee of any Board Resolution, Officer’s Certificate, Opinion of Counsel or other document or instrument, a clerical, typographical or other inadvertent or unintentional error or omission shall be discovered therein, a new document or instrument may be substituted therefor in corrected form with the same force and effect as if originally filed in the corrected form and, irrespective of the date or dates of the actual execution and/or delivery thereof, such substitute document or instrument shall be deemed to have been executed and/or delivered as of the date or dates required with respect to the document or instrument for which it is substituted.  Anything in this Indenture to the contrary notwithstanding, if any such corrective document or instrument indicates that action has been taken by or at the request of the Company which could not have been taken had the original document or instrument not contained such error or omission, the action so taken shall not be invalidated or otherwise rendered ineffective but shall be and remain in full force and effect, except to the extent that such action was a result of willful misconduct or bad faith.  Without limiting the generality of the foregoing, any Securities issued under the authority of such defective document or instrument shall nevertheless be the valid obligations of the Company entitled to the benefits provided by this Indenture equally and ratably with all other Outstanding Securities, except as aforesaid.

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SECTION 104.    Acts of Holders.

(a)   Any request, demand, authorization, direction, notice, consent, election, waiver, vote or other action provided by this Indenture to be made, given or taken by Holders may be embodied in and evidenced by one or more instruments of substantially similar tenor signed by such Holders in person or by an agent duly appointed in writing or, alternatively, may be embodied in and evidenced by the record of Holders voting in favor thereof, either in person or by proxies duly appointed in writing, at any meeting of Holders duly called and held in accordance with the provisions of Article Twelve, or a combination of such instruments and any such record.  Except as herein otherwise expressly provided, such action shall become effective when such instrument or instruments or record or both are delivered to the Trustee and, where it is hereby expressly required, to the Company.  Such instrument or instruments and any such record (and the action embodied therein and evidenced thereby) are herein sometimes referred to as the “Act” of the Holders signing such instrument or instruments and so voting at any such meeting.  Proof of execution of any such instrument or of a writing appointing any such agent, or of the holding by any Person of a Security, shall be sufficient for any purpose of this Indenture and (subject to Section 801) conclusive in favor of the Trustee and the Company, if made in the manner provided in this Section.  The record of any meeting of Holders shall be proved in the manner provided in Section 1206.

(b)   The fact and date of the execution by any Person of any such instrument or writing may be proved by the affidavit of a witness of such execution or by a certificate of a notary public or other officer authorized by law to take acknowledgments of deeds, certifying that the individual signing such instrument or writing acknowledged to him the execution thereof or may be proved in any other manner which the Trustee and the Company deem sufficient.  Where such execution is by a signer acting in a capacity other than his individual capacity, such certificate or affidavit shall also constitute sufficient proof of his authority.

(c)   The ownership of Securities, the principal amount (except as otherwise contemplated in clause (y) of the first proviso to the definition of Outstanding) and serial numbers of Securities held by any Person, and the date of holding the same, shall be proved by the Security Register.

(d)   Any request, demand, authorization, direction, notice, consent, election, waiver or other Act of a Holder shall bind every future Holder of the same Security and the Holder of every Security issued upon the registration of transfer thereof or in exchange therefor or in lieu thereof in respect of anything done, omitted or suffered to be done by the Trustee or the Company in reliance thereon, whether or not notation of such action is made upon such Security.

(e)   Until such time as written instruments shall have been delivered to the Trustee with respect to the requisite percentage of principal amount of Securities for the action contemplated by such instruments, any such instrument executed and delivered by or on behalf of a Holder may be revoked with respect to any or all of such Securities by written notice by such Holder or any subsequent Holder, proven in the manner in which such instrument was proven.

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(f)    Securities of any series, or any Tranche thereof, authenticated and delivered after any Act of Holders may, and shall if required by the Trustee, bear a notation in form approved by the Trustee as to any action taken by such Act of Holders.  If the Company shall so determine, new Securities of any series, or any Tranche thereof, so modified as to conform, in the opinion of the Trustee and the Company, to such action may be prepared and executed by the Company and authenticated and delivered by the Trustee in exchange for Outstanding Securities of such series or Tranche.

(g)   The Company may, at its option, by Company Order, fix in advance a record date for the determination of Holders entitled to give any request, demand, authorization, direction, notice, consent, waiver, vote or other Act solicited by the Company, but the Company shall have no obligation to do so; provided, however, that the Company may not fix a record date for the giving or making of any notice, declaration, request or direction referred to in the next sentence.  In addition, the Trustee may, at its option, fix in advance a record date for the determination of Holders of Securities of any series entitled to join in the giving or making of any Notice of Default, any declaration of acceleration referred to in Section 702, any request to institute proceedings referred to in Section 707 or any direction referred to in Section 712, in each case with respect to Securities of such series.  If any such record date is fixed, such request, demand, authorization, direction, notice, consent, waiver or other Act, or such notice, declaration, request or direction, may be given before or after such record date, but only the Holders of record at the close of business on the record date shall be deemed to be Holders for the purposes of determining (i) whether Holders of the requisite proportion of the Outstanding Securities have authorized or agreed or consented to such Act (and for that purpose the Outstanding Securities shall be computed as of the record date) and/or (ii) which Holders may revoke any such Act (notwithstanding subsection (e) of this Section); and any such Act, given as aforesaid, shall be effective whether or not the Holders which authorized or agreed or consented to such Act remain Holders after such record date and whether or not the Securities held by such Holders remain Outstanding after such record date.

SECTION 105.    Notices, Etc. to Trustee and Company.

Any request, demand, authorization, direction, notice, consent, election, waiver or Act of Holders or other document provided or permitted by this Indenture to be made upon, given or furnished to, or filed with, the Trustee by any Holder or by the Company, or the Company by the Trustee or by any Holder, shall be sufficient for every purpose hereunder (unless otherwise expressly provided herein) if the same shall be in writing and delivered personally to an officer or other responsible employee of the addressee, or transmitted by facsimile transmission, telex or other direct written electronic means to such telephone number or other electronic communications address set forth opposite such parties name below or as the parties hereto shall from time to time designate, or transmitted by registered mail, charges prepaid, to the applicable address set opposite such party’s name below or to such other address as either party hereto may from time to time designate:

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If to the Trustee, to:

U.S. Bank National Association

60 Livingston Avenue

St. Paul, Minnesota  55107

Attention:  Richard Prokosch

Telephone:  651-495-3918

Facsimile:  651-495-8097

If to the Company, to:

NorthWestern Corporation

125 S. Dakota Avenue, Suite 1100

Sioux Falls, South Dakota  57104

Attention:  Corporate Secretary

Telephone:  (605) 782-5351

Facsimile:  (605) 978-2840

Any communication contemplated herein shall be deemed to have been made, given, furnished and filed if personally delivered, on the date of delivery, if transmitted by facsimile transmission, telex or other direct written electronic means, on the date of transmission, and if transmitted by registered mail, on the date of receipt.

SECTION 106.    Notice to Holders of Securities; Waiver.

Except as otherwise expressly provided herein, where this Indenture provides for notice to Holders of any event, such notice shall be sufficiently given, and shall be deemed given, to Holders if in writing and mailed, first-class postage prepaid, to each Holder affected by such event, at the address of such Holder as it appears in the Security Register, not later than the latest date, and not earlier than the earliest date, prescribed for the giving of such notice.

In case by reason of the suspension of regular mail service or by reason of any other cause it shall be impracticable to give such notice to Holders by mail, then such notification as shall be made with the approval of the Trustee shall constitute a sufficient notification for every purpose hereunder.  In any case where notice to Holders is given by mail, neither the failure to mail such notice, nor any defect in any notice so mailed, to any particular Holder shall affect the sufficiency of such notice with respect to other Holders.

Any notice required by this Indenture may be waived in writing by the Person entitled to receive such notice, either before or after the event otherwise to be specified therein, and such waiver shall be the equivalent of such notice.  Waivers of notice by Holders shall be filed with the Trustee, but such filing shall not be a condition precedent to the validity of any action taken in reliance upon such waiver.

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SECTION 107.    Conflict with Trust Indenture Act.

If any provision of this Indenture limits, qualifies or conflicts with another provision hereof which is required or deemed to be included in this Indenture by, or is otherwise governed by, any provision of the Trust Indenture Act, such other provision shall control; and if any provision hereof otherwise conflicts with a provision of the Trust Indenture Act that is required under the Trust Indenture Act to be a part of and govern this Indenture, the Trust Indenture Act shall control.  If any provision of this Indenture modifies or excludes any provision of the Trust Indenture Act which may be so modified or excluded, the latter provision shall be deemed to apply to this Indenture as so modified, or shall be excluded, as the case may be.

SECTION 108.    Effect of Headings and Table of Contents.

The Article and Section headings in this Indenture and the Table of Contents are for convenience only and shall not affect the construction hereof.

SECTION 109.    Successors and Assigns.

All covenants and agreements in this Indenture by the Company shall bind its successors and assigns, whether so expressed or not.

SECTION 110.    Separability Clause.

In case any provision in this Indenture or the Securities shall be held to be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

SECTION 111.    Benefits of Indenture.

Nothing in this Indenture or the Securities, express or implied, shall give to any Person, other than the parties hereto, their successors hereunder and the Holders, any benefit or any legal or equitable right, remedy or claim under this Indenture.

SECTION 112.    Governing Law.

This Indenture and the Securities shall be governed by and construed in accordance with the law of the State of New York (including without limitation Section 5-1401 of the New York General Obligations Law or any successor to such statute), except to the extent that the Trust Indenture Act shall be applicable.

SECTION 113.    Legal Holidays.

In any case where any Interest Payment Date, Redemption Date or Stated Maturity of any Security shall not be a Business Day at any Place of Payment, then (notwithstanding any other provision of this Indenture or of the Securities other than a contrary provision in the Securities of any series, or any Tranche thereof, or in the indenture supplemental hereto, Board Resolution or Officer’s Certificate which establishes the terms of the Securities of

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such series or Tranche) payment of interest or principal and premium, if any, need not be made at such Place of Payment on such date, but may be made on the next succeeding Business Day at such Place of Payment with the same force and effect as if made on the Interest Payment Date or Redemption Date, or at the Stated Maturity, and, if such payment is made or duly provided for on such Business Day, no interest shall accrue on the amount so payable for the period from and after such Interest Payment Date, Redemption Date or Stated Maturity, as the case may be, to such Business Day.

SECTION 114.    Investment of Cash Held by Trustee.

Any cash held by the Trustee or any Paying Agent under any provision of this Indenture shall, at the request of the Company evidenced by Company Order, be invested or reinvested in Cash Equivalents designated by the Company (such Company Order to contain a representation to the effect that the securities designated therein constitute Cash Equivalents), and any interest on such Cash Equivalents shall be promptly paid over to the Company as received free and clear of any Lien.  Such Cash Equivalents shall be held subject to the same provisions hereof as the cash used to purchase the same, but upon a like request of the Company shall be sold, in whole or in designated part, and the proceeds of such sale shall be held subject to the same provisions hereof as the cash used to purchase the Cash Equivalents so sold.  If such sale shall produce a net sum less than the cost of the Cash Equivalents so sold, the Company shall pay to the Trustee or any such Paying Agent, as the case may be, such amount in cash as, together with the net proceeds from such sale, shall equal the cost of the Cash Equivalents so sold, and if such sale shall produce a net sum greater than the cost of the Cash Equivalents so sold, the Trustee or any such Paying Agent, as the case may be, shall promptly pay over to the Company an amount in cash equal to such excess, free and clear of any Lien.  In no event shall the Trustee be liable for any loss incurred in connection with the sale of any Investment Security pursuant to this Section.

Notwithstanding the foregoing, if an Event of Default shall have occurred and be continuing, interest on Cash Equivalents and any gain upon the sale thereof shall be held, in trust, until such Event of Default shall have been cured or waived, whereupon such interest and gain shall be promptly paid over to the Company free and clear of any Lien.

“Cash Equivalents” means:

(a)           United States dollars; (b) securities issued or directly and fully guaranteed or insured by the United States government or any agency or instrumentality of the United States government (provided that the full faith and credit of the United States is pledged in support of those securities) having maturities of not more than one year from the date of acquisition; (c) certificates of deposit and eurodollar time deposits with maturities of one year or less from the date of acquisition, bankers’ acceptances with maturities not exceeding one year and overnight bank deposits, in each case, with any domestic commercial bank having capital and surplus in excess of $500.0 million and a Thomson Bank Watch Rating of “B” or better; (d) repurchase obligations with a term of not more than seven days for underlying securities of the types described in clauses (b) and (c) above entered into with any financial institution meeting the qualifications specified in clause (3) above; (e) commercial paper having one or the two highest ratings obtainable from Moody’s Investors Service, Inc. or Standard & Poor’s Rating Group, Inc.

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(or any successor to the business of either thereof) and in each case maturing within one year after the date of acquisition; and (f) money market funds at least 95% of the assets of which constitute Cash Equivalents of the kinds described in clauses (a) through (e) of this definition.

ARTICLE TWO

Security Forms

SECTION 201.    Forms Generally.

The definitive Securities of each series shall be in substantially the form or forms established in the Officer’s Certificate, the indenture supplemental hereto or the Board Resolution establishing such series, in any case with such appropriate insertions, omissions, substitutions and other variations as are required or permitted by this Indenture, and may have such letters, numbers or other marks of identification and such legends or endorsements placed thereon as may be required to comply with the rules of any securities exchange or as may, consistently herewith, be determined by the officers executing such Securities, as evidenced by their execution of the Securities.  If the form or forms of Securities of any series are established in a Board Resolution or in an Officer’s Certificate, such Board Resolution and Officer’s Certificate, if any, shall be delivered to the Trustee at or prior to the delivery of the Company Order contemplated by Section 303 for the authentication and delivery of such Securities.

The Securities of each series shall be issuable in registered form without coupons.  The definitive Securities shall be produced in such manner as shall be determined by the officers executing such Securities, as evidenced by their execution thereof.

SECTION 202.    Form of Trustee’s Certificate of Authentication.

The Trustee’s certificate of authentication shall be in substantially the form set forth below:

This is one of the Securities of the series designated therein referred to in the within-mentioned Indenture.

as Trustee
By:
	Authorized Officer

ARTICLE THREE

The Securities

SECTION 301.    Amount Unlimited; Issuable in Series.

The aggregate principal amount of Securities which may be authenticated and delivered under this Indenture is unlimited.

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The Securities may be issued in one or more series.  Subject to the last paragraph of this Section, prior to the authentication and delivery of Securities of any series there shall be established by specification in a supplemental indenture, an Officer’s Certificate or a Board Resolution:

(a)   the title of the Securities of such series (which shall distinguish the Securities of such series from Securities of all other series);

(b)   any limit upon the aggregate principal amount of the Securities of such series which may be authenticated and delivered under this Indenture (except for Securities authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of, other Securities of such series pursuant to Section 304, 305, 306, 406 or 1106 and except for any Securities which, pursuant to Section 303, are deemed never to have been authenticated and delivered hereunder);

(c)   the Persons (without specific identification) to whom interest, if any, on Securities of such series, or any Tranche thereof, shall be payable, if other than the Persons in whose names such Securities (or one or more Predecessor Securities) are registered at the close of business on the Regular Record Date for such interest;

(d)   the date or dates on which the principal of the Securities of such series, or any Tranche thereof, is payable or any formulary or other method or other means by which such date or dates shall be determined, by reference to an index or other fact or event ascertainable outside of this Indenture or otherwise (without regard to any provisions for redemption, prepayment, acceleration, purchase or extension);

(e)   the rate or rates at which the Securities of such series, or any Tranche thereof, shall bear interest, if any (including the rate or rates at which overdue principal shall bear interest, if different from the rate or rates at which such Securities shall bear interest prior to Maturity, and, if applicable, the rate or rates at which overdue premium or interest shall bear interest, if any), or any formulary or other method or other means by which such rate or rates shall be determined, by reference to an index or other fact or event ascertainable outside of this Indenture or otherwise; the date or dates from which such interest shall accrue; the Interest Payment Dates on which such interest shall be payable and the Regular Record Date, if any, for the interest payable on such Securities on any Interest Payment Date; the basis of computation of interest, if other than as provided in Section 310;

(f)    the place or places at which and/or the methods (if other than as provided elsewhere in this Indenture) by which (i) the principal of and premium, if any, and interest, if any, on Securities of such series, or any Tranche thereof, shall be payable, (ii) registration of transfer of Securities of such series, or any Tranche thereof, may be effected, (iii) exchanges of Securities of such series, or any Tranche thereof, may be effected and (iv) notices and demands to or upon the Company in respect of the Securities of such series, or any Tranche thereof, and this Indenture may be served; the Security Registrar and any Paying Agent or Agents for such series or Tranche; and, if such is the case, that the principal of such Securities shall be payable without the presentment or surrender thereof;

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(g)   the period or periods within which or the date or dates on which, the price or prices at which and the terms and conditions upon which the Securities of such series, or any Tranche thereof, may be redeemed, in whole or in part, at the option of the Company;

(h)   the obligation or obligations, if any, of the Company to redeem or purchase or repay the Securities of such series, or any Tranche thereof, pursuant to any sinking fund or other mandatory redemption provisions or at the option of a Holder thereof and the period or periods within which or the date or dates on which, the price or prices at which and the terms and conditions upon which such Securities shall be redeemed or purchased or repaid, in whole or in part, pursuant to such obligation, and applicable exceptions to the requirements of Section 404 in the case of mandatory redemption or redemption or repayment at the option of the Holder;

(i)    the denominations in which Securities of such series, or any Tranche thereof, shall be issuable if other than denominations of One Thousand Dollars ($1,000) and any integral multiple thereof;

(j)    the currency or currencies, including composite currencies, in which payment of the principal of or premium, if any, or interest, if any, on the Securities of such series, or any Tranche thereof, shall be payable (if other than in Dollars) and the formulary or other method or other means by which the equivalent of any such amount in Dollars is to be determined for any purpose, including for the purpose of determining the principal amount of such Securities deemed to be Outstanding at any time;

(k)   the series of First Mortgage Bonds (to be issued under either one or both of the Mortgages) to provide security for the payment of principal of, premium (if any) and interest (if any) on the Securities of such series (and, if there are more than one such series of First Mortgage Bonds, the Applicable Basis with respect thereto); and if applicable with respect to the Securities of such series, any provisions providing for the termination of the lien of this Indenture upon the related First Mortgage Bonds in addition to those provisions contained in Section 315 hereof;

(l)    if the principal of or premium, if any, or interest, if any, on the Securities of such series, or any Tranche thereof, are to be payable, at the election of the Company or a Holder thereof, in a coin or currency other than that in which the Securities are stated to be payable, the period or periods within which, and the terms and conditions upon which, such election may be made;

(m)  if the principal of or premium, if any, or interest, if any, on the Securities of such series, or any Tranche thereof, are to be payable, or are to be payable at the election of the Company or a Holder thereof, in securities or other property, the type and amount of such securities or other property, or the formulary or other method or other means by which such amount shall be determined, and the period or periods within which, and the terms and conditions upon which, any such election may be made;

(n)   if the amount payable in respect of the principal of or premium, if any, or interest, if any, on the Securities of such series, or any Tranche thereof, may be determined

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with reference to an index or other fact or event ascertainable outside of this Indenture, the manner in which such amounts shall be determined (to the extent not established pursuant to clause (e) of this paragraph);

(o)   if other than the principal amount thereof, the portion of the principal amount of Securities of such series, or any Tranche thereof, which shall be payable upon declaration of acceleration of the Maturity thereof pursuant to Section 702;

(p)   any Events of Default, in addition to those specified in Section 701, or any exceptions to those specified in Section 701, with respect to the Securities of any series, any covenants of the company for the benefit of the Holders of such Securities, in addition to those set forth herein, and any Restricted Subsidiaries that shall be specified with respect to any such covenants and the Securities of any series;

(q)   the terms, if any, pursuant to which the Securities of such series, or any Tranche thereof, may be converted into or exchanged for shares of capital stock or other securities of the Company or any other Person;

(r)    the obligations or instruments, if any, which shall be considered to be Eligible Obligations in respect of the Securities of such series, or any Tranche thereof, denominated in a currency other than Dollars or in a composite currency, and any modification or provisions in addition to or in lieu of the provisions set forth in Article Six in respect of the Securities of such series;

(s)   if the Securities of such series, or any Tranche thereof, are to be issued in global form, (i) any limitations on the rights of the Holder or Holders of such Securities to transfer or exchange the same or to obtain the registration of transfer thereof, (ii) any limitations on the rights of the Holder or Holders thereof to obtain certificates therefor in definitive form in lieu of global or temporary forms and (iii) any other matters incidental to such Securities;

(t)    if the Securities of such series, or any Tranche thereof, are to be issuable as bearer securities, any and all matters incidental thereto which are not specifically addressed in a supplemental indenture as contemplated by clause (f) of Section 1101;

(u)   to the extent not established pursuant to clause (r) of this paragraph, any limitations on the rights of the Holders of the Securities of such Series, or any Tranche thereof, to transfer or exchange such Securities or to obtain the registration of transfer thereof; and if a service charge will be made for the registration of transfer or exchange of Securities of such series, or any Tranche thereof, the amount or terms thereof;

(v)   any exceptions to Section 113, or variation in the definition of Business Day, with respect to the Securities of such series, or any Tranche thereof; and

(w)  any other terms of the Securities of such series, or any Tranche thereof.

With respect to Securities of a series subject to a Periodic Offering, the indenture supplemental hereto, the Officer’s Certificate or the Board Resolution which establishes such

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series, as the case may be, may provide general terms or parameters for Securities of such series and provide either that the specific terms of Securities of such series, or any Tranche thereof, shall be specified in a Company Order or that such terms shall be determined by the Company or its agents in accordance with procedures specified in a Company Order as contemplated by clause (b) of Section 303.

If specified with respect to a series of Securities pursuant to Section 301(b), any limit upon the aggregate principal amount of a series of Securities may be increased without the consent of any Holders and additional Securities of such series may be authenticated and delivered up to the limit upon the aggregate principal amount authorized with respect to such series as so increased.

SECTION 302.    Denominations.

Unless otherwise provided as contemplated by Section 301 with respect to any series of Securities, or any Tranche thereof, the Securities of each series shall be issuable in denominations of One Thousand Dollars ($1,000) and any integral multiple thereof.

SECTION 303.    Execution, Dating, Certificate of Authentication.

Unless otherwise provided as contemplated by Section 301 with respect to any series of Securities, or any Tranche thereof, the Securities shall be executed on behalf of the Company by an Authorized Officer, and may have the corporate seal of the Company affixed thereto or reproduced thereon and attested by any other Authorized Officer.  The signature of any or all of these officers on the Securities may be manual or facsimile.

Securities bearing the manual or facsimile signatures of individuals who were at the time of execution Authorized Officers of the Company shall bind the Company, notwithstanding that such individuals or any of them have ceased to hold such offices prior to the authentication and delivery of such Securities or did not hold such offices at the date of such Securities.

The Trustee shall authenticate and deliver Securities of a series, for original issue, at one time or from time to time in accordance with the Company Order referred to below, upon receipt by the Trustee of:

(a)   the instrument or instruments establishing the form or forms and terms of such series, as provided in Sections 201 and 301;

(b)   a Company Order requesting the authentication and delivery of such Securities and, to the extent that the terms of such Securities shall not have been established in an indenture supplemental hereto, an Officer’s Certificate or a Board Resolution, all as contemplated by Sections 201 and 301, either (i) establishing such terms or (ii) in the case of Securities of a series subject to a Periodic Offering, specifying procedures, acceptable to the Trustee, by which such terms are to be established (which procedures may provide for authentication and delivery pursuant to oral or electronic instructions from the Company or any agent or agents thereof, which oral instructions are to be promptly confirmed

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electronically or in writing), in either case in accordance with the instrument or instruments delivered pursuant to clause (a) above;

(c)   Securities of such series, executed on behalf of the Company by an Authorized Officer;

(d)   an Opinion of Counsel to the effect that:

(i)            the form or forms of such Securities have been duly authorized by the Company and have been established in conformity with the provisions of this Indenture;

(ii)           the terms of such Securities have been duly authorized by the Company and have been established in conformity with the provisions of this Indenture; and

(iii)          when such Securities shall have been authenticated and delivered by the Trustee and issued and delivered by the Company in the manner and subject to any conditions specified in such Opinion of Counsel, such Securities will constitute valid and binding obligations of the Company, enforceable against the Company in accordance with their terms, subject to Customary Exceptions, and entitled to the benefits provided by this Indenture;

provided, however, that, with respect to Securities of a series subject to a Periodic Offering, the Trustee shall be entitled to receive such Opinion of Counsel only once at or prior to the time of the first authentication and delivery of such Securities (provided that such Opinion of Counsel addresses the authentication and delivery of all Securities of such series) and that, in lieu of the opinions described in clauses (ii) and (iii) above, such Opinion of Counsel may be to the effect that:

(x)            when the terms of such Securities shall have been established pursuant to a Company Order or Orders or pursuant to such procedures as may be specified from time to time by a Company Order or Orders, all as contemplated by and in accordance with the instrument or instruments delivered pursuant to clause (a) above, such terms will have been duly authorized by the Company and will have been established in conformity with the provisions of this Indenture; and

(y)           when such Securities shall have been authenticated and delivered by the Trustee in accordance with this Indenture and the Company Order or Orders or the specified procedures referred to in paragraph (x) above and issued and delivered by the Company in the manner and subject to any conditions specified in such Opinion of Counsel, such Securities will constitute valid and binding obligations of the Company, enforceable against the Company in accordance with their terms, subject to Customary Exceptions, and entitled to the benefits provided by this Indenture; and

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(e)   the First Mortgage Bond or First Mortgage Bonds and documents specified in Section 312.

With respect to Securities of a series subject to a Periodic Offering, the Trustee may conclusively rely, as to the authorization by the Company of any of such Securities, the forms and terms thereof, the validity thereof and the compliance of the authentication and delivery thereof with the terms and conditions of this Indenture, upon the Opinion or Opinions of Counsel and the certificates and other documents delivered pursuant to this Article at or prior to the time of the first authentication and delivery of Securities of such series until any of such opinions, certificates or other documents have been superseded or revoked or expire by their terms.  In connection with the authentication and delivery of Securities of a series subject to a Periodic Offering, the Trustee shall be entitled to assume that the Company’s instructions to authenticate and deliver such Securities do not violate any applicable law or any applicable rule, regulation or order of any Governmental Authority having jurisdiction over the Company.

If the form or terms of the Securities of any series have been established by or pursuant to a Board Resolution or an Officer’s Certificate as permitted by Sections 201 or 301, the Trustee shall not be required to authenticate such Securities if the issuance of such Securities pursuant to this Indenture will affect the Trustee’s own rights, duties or immunities under the Securities and this Indenture or otherwise in a manner which is not reasonably acceptable to the Trustee.

Unless otherwise specified as contemplated by Section 301 with respect to any series of Securities, or any Tranche thereof, each Security shall be dated the date of its authentication.

Unless otherwise specified as contemplated by Section 301 with respect to any series of Securities, or any Tranche thereof, no Security shall be entitled to any benefit under this Indenture or be valid or obligatory for any purpose unless there appears on such Security a certificate of authentication substantially in the form provided for herein executed by the Trustee or an Authenticating Agent by manual signature of an authorized officer thereof, and such certificate upon any Security shall be conclusive evidence, and the only evidence, that such Security has been duly authenticated and delivered hereunder and is entitled to the benefits of this Indenture.  Notwithstanding the foregoing, if (a) any Security shall have been authenticated and delivered hereunder to the Company, or any Person acting on its behalf, but shall never have been issued and sold by the Company, (b) the Company shall deliver such Security to the Security Registrar for cancellation or shall cancel such Security and deliver evidence of such cancellation to the Trustee, in each case as provided in Section 309, and (c) the Company, at its election, shall deliver to the Trustee a written statement (which need not comply with Section 102 and need not be accompanied by an Officer’s Certificate or an Opinion of Counsel) stating that such Security has never been issued and sold by the Company, then, for all purposes of this Indenture, such Security shall be deemed never to have been authenticated and delivered hereunder and shall never be entitled to the benefits hereof.

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SECTION 304.    Temporary Securities.

Pending the preparation of definitive Securities of any series, or any Tranche thereof, the Company may execute, and upon Company Order the Trustee shall authenticate and deliver, temporary Securities which are printed, lithographed, typewritten, mimeographed, photocopied or otherwise produced, in any authorized denomination, substantially of the tenor of the definitive Securities in lieu of which they are issued, with such appropriate insertions, omissions, substitutions and other variations as the officers executing such Securities may determine, as evidenced by their execution of such Securities; provided, however, that temporary Securities need not recite specific redemption, sinking fund, conversion or exchange provisions.

Except as otherwise specified as contemplated by Section 301 with respect to the Securities of any series, or any Tranche thereof, after the preparation of definitive Securities of such series or Tranche, the temporary Securities of such series or Tranche shall be exchangeable, without charge to the Holder thereof, for definitive Securities of such series or Tranche upon surrender of such temporary Securities at the office or agency of the Company maintained pursuant to Section 502 in a Place of Payment for such Securities.  Upon such surrender of temporary Securities, the Company shall, except as aforesaid, execute and the Trustee shall authenticate and deliver in exchange therefor definitive Securities of the same series and Tranche, of authorized denominations and of like tenor and aggregate principal amount.

Until exchanged in full as hereinabove provided, temporary Securities shall in all respects be entitled to the same benefits (and subject to all the same limitations of rights) under this Indenture as definitive Securities of the same series and Tranche and of like tenor authenticated and delivered hereunder.

SECTION 305.    Registration, Registration of Transfer and Exchange.

The Company shall cause to be kept in one of the offices designated pursuant to Section 502, with respect to the Securities of each series, or any Tranche thereof, a register (the “Security Register”) in which, subject to such reasonable regulations as it may prescribe, the Company shall provide for the registration of Securities of such series or Tranche and the registration of transfer thereof.  The Company shall designate one Person to maintain the Security Register for the Securities of each series and such Person is referred to herein, with respect to such series, as the “Security Registrar”.  Anything herein to the contrary notwithstanding, the Company may designate one or more of its offices as an office in which a register with respect to the Securities of one or more series, or any Tranche or Tranches thereof, shall be maintained, and the Company may designate itself the Security Registrar with respect to one or more of such series.  The Security Register shall be open for inspection by the Trustee and the Company at all reasonable times.

Except as otherwise specified as contemplated by Section 301 with respect to the Securities of any series, or any Tranche thereof, upon presentment for registration of transfer of any Security of such series or Tranche at the office or agency of the Company maintained pursuant to Section 502 in a Place of Payment for such series or Tranche, and further upon satisfaction of any conditions prescribed by applicable law, the Company shall execute, and the Trustee shall authenticate and deliver, in the name of the designated transferee or transferees, one

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or more new Securities of the same series and Tranche, of authorized denominations and of like tenor and aggregate principal amount.

Except as otherwise specified as contemplated by Section 301 with respect to the Securities of any series, or any Tranche thereof, any Security of such series or Tranche may be exchanged at the option of the Holder, for one or more new Securities of the same series and Tranche, of authorized denominations and of like tenor and aggregate principal amount, upon presentment of the Securities to be exchanged at any such office or agency.  Whenever any Securities are so presented for exchange, and upon satisfaction of any conditions prescribed by applicable law, the Company shall execute, and the Trustee shall authenticate and deliver, the Securities which the Holder making the exchange is entitled to receive.

All Securities delivered upon any registration of transfer or exchange of Securities shall be valid obligations of the Company, evidencing the same debt, and entitled to the same benefits (and subject to the same limitations of rights) under this Indenture, as the Securities presented upon such registration of transfer or exchange.

Every Security presented for registration of transfer or for exchange shall (if so required by the Company, the Trustee or the Security Registrar) be duly endorsed or shall be accompanied by a written instrument of transfer in form satisfactory to the Company, the Trustee or the Security Registrar, as the case may be, duly executed by the Holder thereof or his attorney duly authorized in writing.

Unless otherwise specified as contemplated by Section 301 with respect to Securities of any series, or any Tranche thereof, no service charge shall be made for any registration of transfer or exchange of Securities, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any registration of transfer or exchange of Securities, other than exchanges pursuant to Section 304, 406 or 1106 not involving any transfer.

The Company shall not be required to execute or to provide for the registration of transfer of or the exchange of (a) Securities of any series, or any Tranche thereof, during a period of fifteen (15) days immediately preceding the date notice is to be given identifying the serial numbers of the Securities of such series or Tranche called for redemption or (b) any Security so selected for redemption in whole or in part, except the unredeemed portion of any Security being redeemed in part.

SECTION 306.    Mutilated, Destroyed, Lost and Stolen Securities.

If any mutilated Security is presented to the Trustee, the Company shall execute and the Trustee shall authenticate and deliver in exchange therefor a new Security of the same series and Tranche, and of like tenor and principal amount and bearing a number not contemporaneously outstanding.

If there shall be delivered to the Company and the Trustee (a) evidence to their satisfaction of the ownership of and the destruction, loss or theft of any Security and (b) such security or indemnity as may be reasonably required by them to save each of them and any agent of either of them harmless, then, in the absence of notice to the Company or the Trustee that such

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Security is held by a Person deemed to be a protected purchaser under applicable law, the Company shall execute and the Trustee shall authenticate and deliver, in lieu of any such destroyed, lost or stolen Security, a new Security of the same series and Tranche, and of like tenor and principal amount and bearing a number not contemporaneously outstanding.

Notwithstanding the foregoing, in case any such mutilated, destroyed, lost or stolen Security has become or is about to become due and payable, the Company in its discretion may, but subject to compliance with the foregoing conditions, instead of issuing a new Security, pay such Security.

Upon the issuance of any new Security under this Section, the Company may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto and any other reasonable expenses (including the fees and expenses of the Trustee) in connection therewith.

Every new Security of any series issued pursuant to this Section in lieu of any destroyed, lost or stolen Security shall constitute an additional contractual obligation of the Company, whether or not the destroyed, lost or stolen Security shall be at any time enforceable by anyone other than the Holder of such new Security, and any such new Security shall be entitled to all the benefits (and subject to all of the limitations of rights) of this Indenture equally and proportionately with any and all other Securities of such series duly issued hereunder.

The provisions of this Section are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost or stolen Securities.

SECTION 307.    Payment of Interest; Interest Rights Preserved.

Unless otherwise specified as contemplated by Section 301 with respect to the Securities of any series, or any Tranche thereof, interest on any Security which is payable, and is punctually paid or duly provided for, on any Interest Payment Date shall be paid to the Person in whose name that Security (or one or more Predecessor Securities) is registered at the close of business on the Regular Record Date for such interest.

Any interest on any Security of any series which is payable, but is not punctually paid or duly provided for, on any Interest Payment Date (herein called “Defaulted Interest”), shall forthwith cease to be payable to the Holder on the related Regular Record Date by virtue of having been such Holder, and such Defaulted Interest may be paid by the Company, at its election in each case, as provided in clause (a) or (b) below:

(a)   The Company may elect to make payment of any Defaulted Interest to the Persons in whose names the Securities of such series (or their respective Predecessor Securities) are registered at the close of business on a date (herein called a “Special Record Date”) for the payment of such Defaulted Interest, which shall be fixed in the following manner.  The Company shall notify the Trustee in writing of the amount of Defaulted Interest proposed to be paid on each Security of such series and the date of the proposed payment, and at the same time the Company shall deposit with the Trustee an amount of money equal to the aggregate amount proposed to be paid in respect of such Defaulted Interest or shall

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make arrangements satisfactory to the Trustee for such deposit prior to the date of the proposed payment, such money when deposited to be held in trust for the benefit of the Persons entitled to such Defaulted Interest as in this clause provided.  Thereupon the Trustee shall fix a Special Record Date for the payment of such Defaulted Interest which shall be not more than fifteen (15) days and not less than ten (10) days prior to the date of the proposed payment and not less than ten (10) days after the receipt by the Trustee of the notice of the proposed payment.  The Trustee shall promptly notify the Company of such Special Record Date and, in the name and at the expense of the Company, shall, not less than ten (10) days prior to such Special Record Date, cause notice of the proposed payment of such Defaulted Interest and the Special Record Date therefor to be mailed, first-class postage prepaid, to each Holder of Securities of such series at the address of such Holder as it appears in the Security Register.  Notice of the proposed payment of such Defaulted Interest and the Special Record Date therefor having been so mailed, such Defaulted Interest shall be paid to the Persons in whose names the Securities of such series (or their respective Predecessor Securities) are registered at the close of business on such Special Record Date.

(b)   The Company may make payment of any Defaulted Interest on the Securities of any series in any other lawful manner not inconsistent with the requirements of any securities exchange on which such Securities may be listed, and upon such notice as may be required by such exchange, if, after notice given by the Company to the Trustee of the proposed payment pursuant to this clause, such manner of payment shall be deemed practicable by the Trustee.

Subject to the foregoing provisions of this Section and Section 305, each Security delivered under this Indenture upon registration of transfer of or in exchange for or in lieu of any other Security shall carry the rights to interest accrued and unpaid, and to accrue, which were carried by such other Security.

SECTION 308.    Persons Deemed Owners.

Prior to the due presentment of any Security for registration of transfer, the Company, the Trustee and any agent of the Company or the Trustee may treat the Person in whose name any Security is registered as the absolute owner of such Security for the purpose of receiving payment of principal of and premium, if any, and (subject to Section 307) interest, if any, on such Security and for all other purposes whatsoever, whether or not such Security be overdue, and neither the Company, the Trustee nor any agent of the Company or the Trustee shall be affected by notice to the contrary.

SECTION 309.    Cancellation by Security Registrar.

All Securities presented for payment, redemption, registration of transfer or exchange shall, if presented to any Person other than the Security Registrar, be delivered to the Security Registrar and, if not theretofore canceled, shall be promptly canceled by the Security Registrar.  The Company may at any time deliver to the Security Registrar for cancellation any Securities previously authenticated and delivered hereunder which the Company may have acquired in any manner whatsoever or which the Company shall not have issued and sold, and all Securities so delivered shall be promptly canceled by the Security Registrar.  Unless by a

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Company Order the Company shall direct that canceled Securities be returned to it, all canceled Securities held by the Security Registrar shall be disposed of in accordance with the Security Registrar’s customary procedures, and the Security Registrar shall promptly deliver a certificate of disposition to the Trustee and the Company.  The Security Registrar shall promptly deliver evidence of any cancellation of a Security in accordance with this Section 309 to the Trustee and the Company.

SECTION 310.    Computation of Interest.

Except as otherwise specified as contemplated by Section 301 for Securities of any series, or any Tranche thereof, interest on the Securities of each series shall be computed on the basis of a three hundred sixty (360) day year consisting of twelve (12) thirty (30) day months and, with respect to any period less than a full calendar month, on the basis of the actual number of days elapsed during such period.

SECTION 311.    Payment to Be in Proper Currency.

In the case of the Securities of any series, or any Tranche thereof, denominated in any currency other than Dollars or in a composite currency (the “Required Currency”), except as otherwise specified with respect to such Securities as contemplated by Section 301, the obligation of the Company to make any payment of the principal thereof, or the premium, if any, or interest, if any, thereon, shall not be discharged or satisfied by any tender by the Company, or recovery by the Trustee, in any currency other than the Required Currency, except to the extent that such tender or recovery shall result in the Trustee timely holding the full amount of the Required Currency then due and payable.  If any such tender or recovery is in a currency other than the Required Currency, the Trustee may take such actions as it considers appropriate to exchange such currency for the Required Currency.  The costs and risks of any such exchange, including without limitation the risks of delay and exchange rate fluctuation, shall be borne by the Company, the Company shall remain fully liable for any shortfall or delinquency in the full amount of Required Currency then due and payable, and in no circumstances shall the Trustee be liable therefor except in the case of its negligence or willful misconduct, and if, as a result, there shall be moneys on deposit with the Trustee in excess of the payment due in the Required Currency, so long as no Default or Event of Default shall have occurred and be continuing, the Trustee shall pay such excess to the Company upon delivery of a Company Request.  The Company hereby waives any defense of payment based upon any such tender or recovery which is not in the Required Currency, or which, when exchanged for the Required Currency by the Trustee, is less than the full amount or the Required Currency then due and payable.

SECTION 312.    Delivery of First Mortgage Bonds.

(a)   In order to provide security for the payment of the principal of, premium, if any, and interest, if any, on the Securities of each series, the Company, at any time prior to or concurrently with its delivery to the Trustee of Securities of such series for authentication and delivery in accordance with a Company Order pursuant to Section 303, shall deliver to the Trustee, and the Trustee shall accept, First Mortgage Bonds registered in the name of the Trustee:

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(i)            in an aggregate principal amount equal to the aggregate principal amount of the Securities of such series to be authenticated and delivered pursuant to such Company Order;

(ii)           with a stated maturity date or dates that is or are the same as the Stated Maturity or Stated Maturities of such Securities;

(iii)          bearing an interest rate (if any) equal to the interest rate (if any) borne by such Securities;

(iv)          having interest payment dates that are the same as the Interest Payment Dates of such Securities;

(v)           containing redemption provisions which correspond to redemption provisions in such Securities and provisions providing for the mandatory redemption thereof by the Company upon an acceleration of such Securities pursuant to Section 702;

(vi)          in all other material respects conforming as nearly as is practicable to the terms of such Securities; and

(vii)         in such aggregate principal amounts of First Mortgage Bonds issued under the Montana Mortgage and/or First Mortgage Bonds issued under the South Dakota Mortgage and having such other terms, as shall be specified in the supplemental indenture, Officer’s certificate or Board resolution establishing such Securities.

(b)   Each First Mortgage Bond delivered to the Trustee hereunder shall be in the form established by or in accordance with the related Mortgage pursuant to which it is issued and with such appropriate insertions, omissions, substitutions and other variations as are required or permitted by such Mortgage, or are required or permitted by this Indenture and consistent with such Mortgage.

(c)   As contemplated in Section 303, prior to the authentication and delivery by the Trustee of Securities of any series, the Company shall deliver to the Trustee, in addition to the documents with respect to the Securities of such series specified in Section 303,

(i)            a First Mortgage Bond or First Mortgage Bonds conforming to Section 312(a) above;

(ii)           an Opinion of Counsel to the effect that:

(x)            the form or forms of such First Mortgage Bonds have been duly authorized by the Company and have been established in conformity with the provisions of the related Mortgage;

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(y)           the terms of such First Mortgage Bonds have been duly authorized by the Company and have been established in conformity with the provisions of the related Mortgage; and

(z)            such First Mortgage Bonds, when authenticated and delivered by the trustee under the related Mortgage and delivered to the Trustee in accordance with this Indenture and issued and delivered by the Company in the manner and subject to any conditions specified in such Opinion of Counsel, will constitute valid and binding obligations of the Company, enforceable against the Company in accordance with their terms, subject to Customary Exceptions, entitled to the benefit and security of such Mortgage equally and ratably with all other First Mortgage Bonds then “Outstanding” under and as defined in such Mortgage (except as to any sinking fund or other analogous fund with respect to any series of such bonds);

provided, however, that, with respect to Securities of a series subject to a Periodic Offering, the Trustee shall be entitled to receive such Opinion of Counsel only once at or prior to the time of the first authentication and delivery of such Securities and that, in lieu of the opinions described in clauses (B) and (C) above, such Opinion of Counsel may be to the effect that:

(x)            when the terms of such First Mortgage Bonds shall have been established in accordance with the instrument or instruments creating the series of which such First Mortgage Bonds are a part, such terms will have been duly authorized by the Company and will have been established in conformity with the provisions of the related Mortgage; and

(y)           such First Mortgage Bonds, when authenticated and delivered by the trustee under the related Mortgage in accordance with the instrument or instruments creating the series of which such First Mortgage Bonds are a part, issued and delivered in accordance with this Indenture and issued and delivered by the Company in the manner and subject to any conditions specified in such Opinion of Counsel, will constitute valid and binding obligations of the Company, enforceable against the Company in accordance with their terms, subject to Customary Exceptions, entitled to the benefit and security of such Mortgage equally and ratably with all other First Mortgage Bonds then “Outstanding” under and as defined in such Mortgage (except as to any sinking fund or other analogous fund with respect to any series of such bonds); and

(iii)          an Expert’s Certificate as to the fair value to the Company of such First Mortgage Bonds, except as permitted by Section 318(d).

(d)   Notwithstanding anything herein to the contrary, the Trustee shall not be entitled to receive First Mortgage Bonds in connection with the authentication and delivery of Securities of any series upon the surrender in exchange therefor of Outstanding Securities

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of another series, of like tenor and aggregate principal amount, if and to the extent that the Trustee shall retain the First Mortgage Bonds delivered to it in connection with the authentication and delivery of the Securities being surrendered, as contemplated in Section 315.

(e)   Each Security of a series shall specify the series of First Mortgage Bonds under the Montana Mortgage and/or the series of First Mortgage Bonds under the South Dakota Mortgage that secures the Securities of such series (it being expressly stated, for the avoidance of any doubt, that the Securities of a series may be secured by First Mortgage Bonds issued under only one of the Mortgages).  The First Mortgage Bonds delivered pursuant to 312(a) hereof with respect to, and securing, the Securities of any series are sometimes referred to herein as the “related” or “corresponding” First Mortgage Bonds with respect to the Securities of such series; and with respect to any such First Mortgage Bonds, the Securities of the series so secured by such First Mortgage Bonds are sometimes referred to as the “related” or “corresponding” series of Securities.

SECTION 313.    Registration and Ownership of First Mortgage Bonds; First Mortgage Bonds as security for Securities

The First Mortgage Bonds delivered to the Trustee pursuant to Section 312 shall be registered in the name of the Trustee and shall be owned and held in trust by the Trustee, subject to the provisions of this Indenture, for the equal and proportionate benefit and security of the Holders from time to time of the corresponding series of Securities and the Company shall have no interest therein (other than as payor and obligor with respect thereto); and such First Mortgage Bonds shall serve as security for (i) the full and prompt payment of the principal of and premium, if any, on such Securities when and as the same shall become due in accordance with the terms and provisions of such Securities and this Indenture, whether at the Stated Maturity or by declaration of acceleration, call for redemption or otherwise, and (ii) the full and prompt payment of interest (if any) on such Securities when and as the same shall become due in accordance with the terms and provisions of such Securities and this Indenture.  The Trustee as holder of First Mortgage Bonds delivered to the Trustee pursuant to Section 312 shall be entitled to exercise all rights of a security holder of such First Mortgage Bonds under the related Mortgage or Mortgages, either in its discretion or as otherwise provided in this Article or in Article Seven.

If, notwithstanding the intention of the parties expressed in this Section 313, it shall be finally determined by an appropriate court that the Company has any interest in any First Mortgage Bonds delivered to and held by the Trustee pursuant to this Indenture (other than as payor and obligor with respect thereto), the Company hereby, to the extent permitted by law, grants to the Trustee, for the benefit of the Holders of the Outstanding Securities of the series secured by such First Mortgage Bonds, a security interest in such interest of the Company in such First Mortgage Bonds and all proceeds thereof.  Such security interest, together with the other provisions of this Article Three, are referred to herein and constitute the “lien of this Indenture” on such First Mortgage Bonds.

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SECTION 314.    Amounts Payable On and Credited Against First Mortgage Bonds.

(a)   Amounts Payable Under First Mortgage Bonds.           Payments of principal of, premium (if any) or interest that become due on First Mortgage Bonds delivered to and held by the Trustee pursuant to this Indenture on any day shall correspond to, and be equal in aggregate amount to, the payment of principal of, premium (if any) or interest that becomes due on the Securities of the related series on such day.  If the Securities of a series are secured by more than one series of related First Mortgage Bonds (whether issued under the same Mortgage or under different Mortgages), the portions of the principal of, premium (if any) and/or interest (if any) due on the Securities of such series on any day that are payable under, and secured by, the respective series of the related First Mortgage Bonds will be determined on the basis set forth in the indenture supplemental hereto, the Officer’s Certificate or the Board Resolution which establishes such series of securities (referred to herein, with respect to a series of Securities and the related First Mortgage Bonds, as the “Applicable Basis”).

(b)   Crediting of Payments on Securities Against First Mortgage Bond Obligations.  Consistent with the intention of the parties expressed in Section 313 and elsewhere in this Article that First Mortgage Bonds delivered to and held by the Trustee pursuant to this Indenture are delivered for the benefit of holders of the related series of Securities to provide security for payments due on such Securities, it is also the intention of the parties that the Company will make payments to the Trustee of principal of, premium (if any) and/or interest (if any) on the related series of Securities (rather than payments to the trustee(s) under the related Mortgage(s) of corresponding amounts payable on such First Mortgage Bonds).  Accordingly:

(i)            the payment by the Company of the principal of, premium (if any) or interest (if any) that is payable on the Securities of a series on any day shall, to the extent thereof (and, if there is more than one series of related First Mortgage Bonds, on the Applicable Basis with respect to such First Mortgage Bonds) be deemed to satisfy and discharge the obligation of the Company to make corresponding payments of principal of, premium (if any) or interest (if any) on the related First Mortgage Bonds on such day; and

(ii)           absent advice to the contrary from the Trustee, the trustees under the related Mortgage(s) may assume that payments on First Mortgage Bonds delivered to and held by the Trustee pursuant to this Indenture have been satisfied from payments on the related series of Securities.

(c)   Crediting of Payments On First Mortgage Bonds Against Securities Obligations.  If, notwithstanding the intention of the parties (as described above) and for any reason, the Trustee receives actual payments (rather than payments which are deemed made by crediting payments by the Company on the related series of Securities) on First Mortgage Bonds delivered to and held by the Trustee pursuant to this Indenture:

(i)            If, at the time of receipt by the Trustee of such payment, any principal of, premium (if any), or interest on the related series of Securities is due

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and payable, such payment on such First Mortgage Bonds shall be applied by the Trustee to the payment of such principal of, premium (if any) or interest on the related series of Securities which is so due (and, to the extent of such application, the obligation of the Company hereunder and under such Securities to make such payment shall be deemed satisfied and discharged);

(ii)           If, at the time of receipt by the Trustee of any such payment of principal of such First Mortgage Bonds, there shall be no principal then due in respect of the related series of Securities, such payment of principal of such First Mortgage Bonds shall be held by the Trustee, in trust, and shall be applied by the Trustee to the payment of the principal of an equal principal amount of such Securities at Maturity; and pending such application, such payment may be invested, at the direction of the Company, in Cash Equivalents, pursuant to a Company Order directing such investment and accompanied by an Officer’s Certificate stating that no Default or Event of Default has occurred and is continuing; and

(iii)          If, at the time of receipt by the Trustee of any such payment of premium or interest on such First Mortgage Bonds, there shall be no premium or interest, as the case may be, then due in respect of the related series of Securities, such payment of premium or interest on such First Mortgage Bonds shall be remitted by the Trustee to the Company upon receipt by the Trustee of a Company Order requesting the same, together with an Officer’s Certificate stating that no Event of Default has occurred and is continuing; provided, however, that, if an Event of Default shall have occurred and be continuing, such proceeds shall be held by the Trustee, in trust, until such Event of Default shall have been cured or waived.

SECTION 315.    Surrender of First Mortgage Bonds.

(a)   If, at any time, all or any part of the Securities of a series cease to be Outstanding:

(i)            the obligation of the Company to make payment of the principal of, premium (if any) and interest (if any) on an equal principal amount of the related First Mortgage Bonds shall be deemed satisfied and discharged (and, if there is more than one series of related First Mortgage Bonds, on the Applicable Basis with respect to the related First Mortgage Bonds) without further act on the part of, or fulfillment of any further condition by, any Person; and

(ii)           the Trustee shall surrender to, or upon the order of, the Company an equal principal amount of the related First Mortgage Bonds (and, if there is more than one series of related First Mortgage Bonds, such surrender shall be on the Applicable Basis with respect to the related First Mortgage Bonds), in each case upon fulfillment of the following conditions:

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(x)receipt by the Trustee of a Company Order requesting the surrender of such First Mortgage Bonds; and

(y)receipt by the Trustee of an Expert’s Certificate as to the fair value of such First Mortgage Bonds, except as permitted by Section 318(d); and

(b)Notwithstanding the foregoing, in the event that Outstanding Securities of any series are surrendered in exchange for Securities of another series, of like tenor and aggregate principal amount, the Trustee shall retain the First Mortgage Bonds delivered in connection with the authentication and delivery of the Securities being surrendered unless the Company, at its election, shall tender new First Mortgage Bonds in substitution therefor.

(c)Notwithstanding anything in this Indenture to the contrary, the Company shall not cause the surrender by the Trustee, as contemplated in this Section 315, of First Mortgage Bonds delivered to and held by the Trustee pursuant to this Indenture as security for a series of Securities if, after such surrender, the aggregate principal amount of such First Mortgage Bonds then outstanding that would continue to be so held by the Trustee would be less than the aggregate principal amount of Securities of such series that are then Outstanding (or, if after such surrender, the respective principal amounts of such First Mortgage Bonds of different series would be other than on the same Applicable Basis as before such surrender).

(d)Notwithstanding anything in this Indenture to the contrary, each surrender of any First Mortgage Bonds in accordance with this Section 315 shall be and constitute a termination of the lien of this Indenture on such First Mortgage Bonds in accordance with, and permitted by, this Indenture.

SECTION 316.    No Transfer of First Mortgage Bonds.

Anything in this Indenture to the contrary notwithstanding, the Trustee shall not sell, assign or otherwise transfer any First Mortgage Bonds delivered to and held by it pursuant to this Article except to a successor trustee under this Indenture and except as provided in Section 315.  The Company may take such actions as it shall deem necessary, desirable or appropriate to effect compliance with such restrictions on transfer, including the placing of a legend on each such First Mortgage Bond and the issuance of stop-transfer instructions to the trustee under the related Mortgage or any other transfer agent thereunder.

SECTION 317.    Voting of First Mortgage Bonds.

The Trustee shall, as the holder of First Mortgage Bonds delivered to and held by it pursuant to Sections 312 and 313, attend such meeting or meetings of bondholders under the related Mortgage(s) or, at its option, deliver its proxy in connection therewith, as relate to matters with respect to which it, as such holder, is entitled to vote or consent.  So long as no Event of Default hereunder shall have occurred and be continuing, either at any such meeting or meetings, or otherwise when the consent of the holders of the First Mortgage Bonds Outstanding under the related Mortgage(s) is sought without a meeting, the Trustee shall vote as holder of First Mortgage Bonds delivered to and held by it pursuant to this Article which were delivered under such Mortgage(s), or shall consent with respect thereto, proportionately with the vote or consent

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of the holders of all other First Mortgage Bonds Outstanding under such Mortgage(s) the holders of which are eligible to vote or consent, as indicated in a First Mortgage Bondholder’s Certificate delivered to the Trustee; provided, however, that the Trustee shall not so vote in favor of, or so consent to, any amendment or modification of a Mortgage which, if it were an amendment or modification of this Indenture, would require the consent of Holders, without the prior consent, obtained in the manner prescribed in Section 1102, of Holders of Securities which would be required under said Section 1102 for such an amendment or modification of this Indenture.

For purposes of this Section, “First Mortgage Bondholder’s Certificate” means a certificate signed by the temporary chairman, the temporary secretary, the permanent chairman, the permanent secretary, or an inspector of votes at any meeting or meetings of bondholders under a Mortgage, or by the trustee under such Mortgage in the case of consents of such bondholders which are sought without a meeting, which states what the signer thereof reasonably believes will be the proportionate votes or consents of the holders of all First Mortgage Bonds (other than the First Mortgage Bonds delivered to and held by the Trustee pursuant to this Article) outstanding under such Mortgage and counted for the purposes of determining whether such bondholders have approved or consented to the matter put before them.

SECTION 318.Experts’ Certificates.

(a)Each Expert’s Certificate as to the fair value to the Company of First Mortgage Bonds delivered to the Trustee pursuant to Section 312, or as to the fair value of First Mortgage Bonds to be surrendered pursuant to Section 315, shall be made by an Independent Expert if the fair value to the Company of such First Mortgage Bonds so delivered and of all other First Mortgage Bonds so delivered, or the fair value of the First Mortgage Bonds to be so surrendered and of all other First Mortgage Bonds so surrendered, as the case may be, since the commencement of the then current calendar year, as set forth in the certificates required by this Indenture, is ten percentum (10%) or more of the aggregate principal amount of the Securities at the time Outstanding; but such Expert’s Certificate shall not be required to be made by an Independent Expert in the case of any delivery or surrender of First Mortgage Bonds if the fair value to the Company thereof or the fair value thereof, as the case may be, and as set forth in the certificates required by this Indenture, is less than Twenty-five Thousand Dollars ($25,000) or less than one percentum (1%) of the aggregate principal amount of the Securities at the time Outstanding.

(b)Each Expert’s Certificate with respect to the fair value of First Mortgage Bonds being surrendered shall state that, in the opinion of the signer, such surrender will not impair the security under this Indenture in contravention of the provisions hereof; it being understood, however, that no surrender of First Mortgage Bonds effected in accordance with the provisions, and in compliance with the conditions, set forth in Section 315 shall be deemed to impair the security of this Indenture in contravention of any provision hereof.

(c)In assessing the fair value to the Company or the fair value, as the case may be, of any First Mortgage Bond, an Expert may (but need not) consider, among other things, (i) the principal amount and remaining term to Stated Maturity of, the interest rate, if any, on and the redemption provisions contained in such First Mortgage Bond, (ii) the creditworthiness of the Company, including the effect, if any, of the prospective delivery or

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surrender of such First Mortgage Bonds on the ratings assigned to the Securities by nationally recognized statistical rating organizations, (iii) prevailing economic and market conditions, (iv) the restrictions on the transfer of such First Mortgage Bond contained in Section 316, (v) whether or not, at the time of such assessment, the obligations of the Company in respect of such First Mortgage Bond shall, under the provisions of the related Mortgage or under the provisions of this Indenture, or both, be deemed to have been satisfied and discharged, (vi) the effect, if any, of the prospective delivery or surrender of such First Mortgage Bond on the nature and extent of the security and/or protection available to the Holders under this Indenture and (vii) any other relevant factors.  In addition, in assessing the fair value to the Company or the fair value, as the case may be, of any First Mortgage Bond, an Expert may (but need not) determine that such fair value equals (a) the aggregate principal amount to be due and owing on such First Mortgage Bond or (b) the fair value of the related Security or Securities, upon the basis of which such First Mortgage Bond was delivered to the Trustee.

(d)Anything in this Indenture to the contrary notwithstanding, the Company shall not be required to deliver any Expert’s Certificate pursuant to Section 312 or 315 if, in any particular case, the Company shall have delivered to the Trustee an Opinion of Counsel to the effect that the Expert’s Certificate otherwise required to be delivered shall not, in such case, be required by, or this Indenture is not required to be qualified under, the Trust Indenture Act.

SECTION 319.  No Modification of First Mortgage Bonds by Indenture.

The rights, powers, obligations and duties of the Company and the trustees under the Mortgages and the First Mortgage Bonds are governed exclusively by the terms thereof; and nothing in this Indenture constitutes an amendment or modification of any term or provision of the Mortgages or the First Mortgage Bonds, or creates any obligation of the Company under or in respect of the First Mortgage Bonds (except to the extent of an express covenant of the Company contained in this Indenture) or any right of the Trustee with respect to the Mortgages or the First Mortgage Bonds (except as the owner and holder of First Mortgage Bonds delivered to and held by the Trustee or, in the circumstances described in Section 313, as the holder of a Lien on the Company’s interest in such First Mortgage Bonds).

SECTION 320.  Other Responsibilities of Trustee With Respect to First Mortgage Bonds.

The Trustee shall, with respect to First Mortgage Bonds delivered to and held by the Trustee pursuant to this Indenture, give such notices and information to the trustees under the Mortgages as are required by the terms of such First Mortgage Bonds and/or stated in such First Mortgage Bonds to be notices and information which the Trustee, pursuant to this Indenture, has agreed to give or submit to such trustees.  Without limitation of the foregoing (or of any provision of Article Seven), the Trustee shall: (i) within five days after any failure by the Company to pay, when due, principal of, premium (if any) or interest (if any) on the Securities of any series, give to the trustee(s) under the Mortgage(s) pertaining to the related First Mortgage Bonds notice of such failure in accordance with, and as contemplated by, such First Mortgage Bonds; (ii) within five days after each redemption, in whole or in part, of the Securities of any series, give to the trustee(s) under the Mortgage(s) pertaining to the related First Mortgage Bonds

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notice of such redemption in accordance with, and as contemplated by, such First Mortgage Bonds; and (iii) promptly after each request therefor by the Company, give to the Company and the trustee(s) under the Mortgage(s) notice of the aggregate principal amount of the Securities of each series that are then Outstanding.

SECTION 321.    Further Assurances.

The Company, at its own expense, shall do such further lawful acts and things, and execute and deliver such additional conveyances, assignments, assurances, agreements, financing statements and instruments, as may be necessary and as the Trustee may request in order to better assign, assure, perfect and confirm to the Trustee its interest in the First Mortgage Bonds in accordance with this Article Three and for maintaining, protecting and preserving such interest.

ARTICLE FOUR

Redemption of Securities

SECTION 401.    Applicability of Article.

Securities of any series, or any Tranche thereof, which are redeemable before their Stated Maturity shall be redeemable in accordance with their terms and (except as otherwise specified as contemplated by Section 301 for Securities of such series or Tranche) in accordance with this Article.

SECTION 402.    Election to Redeem; Notice to Trustee.

The election of the Company to redeem any Securities shall be evidenced by a Board Resolution or an Officer’s Certificate.  The Company shall, at least forty-five (45) days prior to the Redemption Date fixed by the Company (unless a shorter notice shall be satisfactory to the Trustee), notify the Trustee in writing of such Redemption Date and of the principal amount of such Securities to be redeemed.  In the case of any redemption of Securities (a) prior to the expiration of any restriction on such redemption provided in the terms of such Securities or elsewhere in this Indenture or (b) pursuant to an election of the Company which is subject to a condition specified in the terms of such Securities, the Company shall furnish the Trustee with an Officer’s Certificate evidencing compliance with such restriction or condition.

SECTION 403.    Selection of Securities to Be Redeemed.

If less than all the Securities of any series, or any Tranche thereof, are to be redeemed, the particular Securities to be redeemed shall be selected by the Security Registrar from the Outstanding Securities of such series or Tranche not previously called for redemption, by such method as shall be provided for any particular series or Tranche, or, in the absence of any such provision, by such method of random selection as the Security Registrar shall deem fair and appropriate and which may, in any case, provide for the selection for redemption of portions (in any authorized denomination for Securities of such series or Tranche) of the principal amount of Securities of such series or Tranche having a denomination larger than the minimum authorized denomination for Securities of such series or Tranche; provided, however, that if, as

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indicated in an Officer’s Certificate, the Company shall have offered to purchase all or any principal amount of the Securities then Outstanding of any series, or any Tranche thereof, and less than all of such Securities as to which such offer was made shall have been tendered to the Company for such purchase, the Security Registrar, if so directed by Company Order, shall select for redemption all or any principal amount of such Securities which have not been so tendered.

The Security Registrar shall promptly notify the Company and the Trustee in writing of the Securities selected for redemption and, in the case of any Securities selected to be redeemed in part, the principal amount thereof to be redeemed.

For all purposes of this Indenture, unless the context otherwise requires, all provisions relating to the redemption of Securities shall relate, in the case of any Securities redeemed or to be redeemed only in part, to the portion of the principal amount of such Securities which has been or is to be redeemed.

SECTION 404.    Notice of Redemption.

Notice of redemption shall be given in the manner provided in Section 106 to the Holders of the Securities to be redeemed not less than thirty (30) nor more than sixty (60) days prior to the Redemption Date.

All notices of redemption shall state:

(a)the Redemption Date,

(b)the Redemption Price,

(c)if less than all the Securities of any series or Tranche are to be redeemed, the identification of the particular Securities to be redeemed and the portion of the principal amount of any Security to be redeemed in part,

(d)that on the Redemption Date the Redemption Price, together with accrued interest, if any, to the Redemption Date, will become due and payable upon each such Security to be redeemed and, if applicable, that interest thereon will cease to accrue on and after said date,

(e)the place or places where such Securities are to be surrendered for payment of the Redemption Price and accrued interest, if any, unless it shall have been specified as contemplated by Section 301 with respect to such Securities that such surrender shall not be required,

(f)that the redemption is for a sinking or other fund, if such is the case, and

(g)such other matters as the Company shall deem desirable or appropriate.

With respect to any notice of redemption of Securities at the election of the Company, unless, upon the giving of such notice, such Securities shall be deemed to have been

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paid in accordance with Section 602, such notice may state that such redemption shall be conditional upon the receipt by the Paying Agent or Agents for such Securities, on or prior to the date fixed for such redemption, of money sufficient to pay the principal of and premium, if any, and interest, if any, on such Securities and that if such money shall not have been so received such notice shall be of no force or effect and the Company shall not be required to redeem such Securities.  In the event that such notice of redemption contains such a condition and such money is not so received, the redemption shall not be made and within a reasonable time thereafter notice shall be given, in the manner in which the notice of redemption was given, that such money was not so received and such redemption was not required to be made, and the Paying Agent or Agents for the Securities otherwise to have been redeemed shall promptly return to the Holders thereof any of such Securities which had been surrendered for payment upon such redemption.

Notice of redemption of Securities to be redeemed at the election of the Company, and any notice of non-satisfaction of a condition for redemption as aforesaid, shall be given by the Company or, upon Company Request, by the Security Registrar in the name and at the expense of the Company.  Notice of mandatory redemption of Securities shall be given by the Security Registrar in the name and at the expense of the Company.

SECTION 405.    Securities Payable on Redemption Date.

Notice of redemption having been given as aforesaid, and the conditions, if any, set forth in such notice having been satisfied, the Securities or portions thereof so to be redeemed shall, on the Redemption Date, become due and payable at the Redemption Price therein specified, and from and after such date (unless, in the case of an unconditional notice of redemption, the Company shall default in the payment of the Redemption Price and accrued interest, if any) such Securities or portions thereof, if interest-bearing, shall cease to bear interest.  Upon surrender of any such Security for redemption in accordance with such notice, such Security or portion thereof shall be paid by the Company at the Redemption Price, together with accrued interest, if any, to the Redemption Date; provided, however, that no such surrender shall be a condition to such payment if so specified as contemplated by Section 301 with respect to such Security; and provided, further, that, except as otherwise specified as contemplated by Section 301 with respect to such Security, any installment of interest on any Security the Stated Maturity of which installment is on or prior to the Redemption Date shall be payable to the Holder of such Security, or one or more Predecessor Securities, registered as such at the close of business on the related Regular Record Date according to the terms of such Security and subject to the provisions of Section 307.

SECTION 406.    Securities Redeemed in Part.

Upon the surrender of any Security which is to be redeemed only in part at a Place of Payment therefor (with, if the Company or the Trustee so requires, due endorsement by, or a written instrument of transfer in form satisfactory to the Company or the Trustee, as the case may be, duly executed by, the Holder thereof or his attorney duly authorized in writing), the Company shall execute, and the Trustee shall authenticate and deliver to the Holder of such Security, without service charge, a new Security or Securities of the same series and Tranche, of any authorized denomination requested by such Holder and of like tenor and in aggregate

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principal amount equal to and in exchange for the unredeemed portion of the principal of the Security so surrendered.

ARTICLE FIVE

Covenants

SECTION 501.    Payment of Securities.

The Company shall pay the principal of and premium, if any, and interest, if any, on the Securities of each series in accordance with the terms of such Securities and this Indenture.

SECTION 502.    Maintenance of Office or Agency.

The Company shall maintain in each Place of Payment for the Securities of each series, or any Tranche thereof, an office or agency where payment of such Securities shall be made, where the registration of transfer or exchange of such Securities may be effected and where notices and demands to or upon the Company in respect of such Securities and this Indenture may be served.  The Company shall give prompt written notice to the Trustee of the location, and any change in the location, of each such office or agency and prompt notice to the Holders of any such change in the manner specified in Section 106.  If at any time the Company shall fail to maintain any such required office or agency in respect of Securities of any series, or any Tranche thereof, or shall fail to furnish the Trustee with the address thereof, payment of such Securities shall be made, registration of transfer or exchange thereof may be effected and notices and demands in respect thereof may be served at the Corporate Trust Office of the Trustee, and the Company hereby appoints the Trustee as its agent for all such purposes in any such event.

The Company may also from time to time designate one or more other offices or agencies with respect to the Securities of one or more series, or any Tranche thereof, for any or all of the foregoing purposes and may from time to time rescind such designations; provided, however, that, unless otherwise specified as contemplated by Section 301 with respect to the Securities of such series or Tranche, no such designation or rescission shall in any manner relieve the Company of its obligation to maintain an office or agency for such purposes in each Place of Payment for such Securities in accordance with the requirements set forth above.  The Company shall give prompt written notice to the Trustee, and prompt notice to the Holders in the manner specified in Section 106, of any such designation or rescission and of any change in the location of any such other office or agency.

Anything herein to the contrary notwithstanding, any office or agency required by this Section may be maintained at an office of the Company, in which event the Company shall perform all functions to be performed at such office or agency.

SECTION 503.    Money for Securities Payments to Be Held in Trust.

If the Company shall at any time act as its own Paying Agent with respect to the Securities of any series, or any Tranche thereof, it shall, on or before each due date of the principal of and premium, if any, and interest, if any, on any of such Securities, segregate and

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hold in trust for the benefit of the Persons entitled thereto a sum sufficient to pay the principal and premium or interest so becoming due until such sums shall be paid to such Persons or otherwise disposed of as herein provided.  The Company shall promptly notify the Trustee of any failure by the Company (or any other obligor on such Securities) to make any payment of principal of or premium, if any, or interest, if any, on such Securities.

Whenever the Company shall have one or more Paying Agents for the Securities of any series, or any Tranche thereof, it shall, on or before each due date of the principal of and premium, if any, and interest, if any, on such Securities, deposit with such Paying Agents sums sufficient (without duplication) to pay the principal and premium or interest so becoming due, such sums to be held in trust for the benefit of the Persons entitled to such principal, premium or interest, and (unless such Paying Agent is the Trustee) the Company shall promptly notify the Trustee of any failure by it so to act.

The Company shall cause each Paying Agent for the Securities of any series, or any Tranche thereof, other than the Company or the Trustee, to execute and deliver to the Trustee an instrument in which such Paying Agent shall agree with the Trustee, subject to the provisions of this Section, that such Paying Agent shall:

(a)hold all sums held by it for the payment of the principal of and premium, if any, or interest, if any, on such Securities in trust for the benefit of the Persons entitled thereto until such sums shall be paid to such Persons or otherwise disposed of as herein provided;

(b)give the Trustee notice of any failure by the Company (or any other obligor upon such Securities) to make any payment of principal of or premium, if any, or interest, if any, on such Securities; and

(c)at any time during the continuance of any such failure, upon the written request of the Trustee, forthwith pay to the Trustee all sums so held in trust by such Paying Agent and furnish to the Trustee such information as it possesses regarding the names and addresses of the Persons entitled to such sums.

The Company may at any time pay, or by Company Order direct any Paying Agent to pay, to the Trustee all sums held in trust by the Company or such Paying Agent, such sums to be held by the Trustee upon the same trusts as those upon which such sums were held by the Company or such Paying Agent and, if so stated in a Company Order delivered to the Trustee, in accordance with the provisions of Article Six; and, upon such payment by any Paying Agent to the Trustee, such Paying Agent shall be released from all further liability with respect to such money.

Any money deposited with the Trustee or any Paying Agent, or then held by the Company, in trust for the payment of the principal of and premium, if any, or interest, if any, on any Security and remaining unclaimed for two years after such principal and premium, if any, or interest, if any, has become due and payable shall be paid to the Company on Company Request, or, if then held by the Company, shall be discharged from such trust; and, upon such payment or discharge, the Holder of such Security shall, as an unsecured general creditor and not as the

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Holder of an Outstanding Security, look only to the Company for payment of the amount so due and payable and remaining unpaid, and all liability of the Trustee or such Paying Agent with respect to such trust money, and all liability of the Company as trustee thereof, shall thereupon cease; provided, however, that the Trustee or such Paying Agent, before being required to make any such payment to the Company, may at the expense of the Company cause to be mailed, on one occasion only, notice to such Holder that such money remains unclaimed and that, after a date specified therein, which shall not be less than thirty (30) days from the date of such mailing, any unclaimed balance of such money then remaining will be paid to the Company.

SECTION 504.    Corporate Existence.

Subject to the rights of the Company under Article Ten (or with respect to any series of Securities, any similar or other rights contained in the supplemental indenture, Board Resolution or Officer’s Certificate establishing the terms of the Securities of such series), the Company shall do or cause to be done all things necessary to preserve and keep its corporate existence and its rights (charter and statutory) and franchises; provided, however, that the Company shall not be required to preserve any such right or franchise if the Company shall determine that the preservation thereof is no longer desirable in the conduct of its business and that the loss thereof is not disadvantageous in any material respect to the Holders.

SECTION 505.    Annual Officer’s Certificates to Compliance.

Not later than April 15 in each year, commencing April 15, 2005, the Company shall deliver to the Trustee an Officer’s Certificate which need not comply with Section 102, executed by the principal executive officer, the principal financial officer or the principal accounting officer of the Company, as to such officer’s knowledge of the compliance by the Company and its Restricted Subsidiaries with all conditions and covenants under this Indenture, such compliance to be determined without regard to any period of grace or requirement of notice under this Indenture.

SECTION 506.    Maintenance of Properties.

The Company shall cause (or, with respect to property owned in common with others, make reasonable effort to cause) all its properties used or useful in the conduct of its businesses, considered as a whole, to be maintained and kept in good condition, repair and working order and shall cause (or, with respect to property owned in common with others, make reasonable effort to cause) to be made such repairs, renewals, replacements, betterments and improvements thereof, as, in the judgment of the Company, may be necessary in order that the operation of such properties, considered as a whole, may be conducted in accordance with common industry practice; provided, however, that nothing in this Section shall prevent the Company from discontinuing, or causing the discontinuance of, the operation and maintenance of any of its properties; and provided, further, that nothing in this Section shall prevent the Company from selling, transferring or otherwise disposing of, or causing the sale, transfer or other disposition of, any of its properties if such discontinuance, sale, transfer or other disposition is, in the judgment of the Company, desirable in the conduct of its business.

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SECTION 507.    Payment of Taxes and Other Claims.

The Company will pay or discharge or cause to be paid or discharged, before the same shall be delinquent, (1) all taxes, assessments, and governmental charges levied or imposed upon it or its income, profits or property, and (2) all lawful claims for labor, materials and supplies which, if unpaid, might by law become a lien upon its property; provided, however, that the Company shall not be required to pay or discharge or cause to be paid or discharged any such tax, assessment, charge, levy or claim whose amount, applicability or validity is being contested in good faith by appropriate proceedings.

SECTION 508.    Waiver of Certain Covenants.

The Company may omit in any particular instance to comply with any term, provision or condition set forth in

(a)any covenant or restriction specified with respect to the Securities of any one or more series, or any Tranche or Tranches thereof, as contemplated by Section 301, or as provided pursuant to Section 1101(f), if before the time for such compliance the Holders of a majority in aggregate principal amount of the Outstanding Securities of all series and Tranches with respect to which compliance with such covenant or restriction is to be omitted, considered as one class, shall, by Act of such Holders, either waive such compliance in such instance or generally waive compliance with such term, provision or condition; provided, however, that no such waiver shall be effective as to any matters contemplated in clause (a), (b) or (c) in Section 1102 without consent of the Holders specified in such Section; and

(b)Section 504, 506 or 507 if before the time for such compliance the Holders of a majority in principal amount of Securities Outstanding under this Indenture shall, by Act of such Holders, either waive such compliance in such instance or generally waive compliance with such term, provision or condition;

but, in either case, no such waiver shall extend to or affect such term, provision or condition except to the extent so expressly waived, and, until such waiver shall become effective, the obligations of the Company and the duties of the Trustee in respect of any such term, provision or condition shall remain in full force and effect.

ARTICLE SIX

Defeasance, Satisfaction and Discharge

SECTION 601.    Option to Effect Legal Defeasance or Covenant Defeasance.

Except as otherwise specified as contemplated by Section 301 for Securities of any series, the provisions of this Article Six shall apply to each series of Securities, and the Company may, at its option evidenced by a Board Resolution, at any time, elect to have either Section 602 or 603 hereof be applied to the Outstanding Securities of any series upon compliance with the conditions set forth below in this Article Six.

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SECTION 602.    Legal Defeasance and Discharge.

Upon the Company’s exercise under Section 601 hereof of the option to apply this Section 602 to the Outstanding Securities of any series, the Company shall, subject to the satisfaction of the conditions set forth in Section 604 hereof, be deemed to have been discharged from its obligations with respect to such Securities on the date the conditions set forth in Section 604 are satisfied (hereinafter, “legal defeasance”).  For this purpose, Legal Defeasance means that the Company shall be deemed to have paid and discharged the entire Indebtedness represented by such Securities, which shall thereafter be deemed to be “Outstanding” only for the purposes of Section 608 hereof and the other Sections of this Indenture referred to in (a) through (d) below, and to have satisfied all its other obligations under such Securities and this Indenture insofar as such Securities are concerned (and the Trustee, on demand of and at the expense of the Company, shall execute proper instruments acknowledging the same), except for the following provisions which shall survive until otherwise terminated or discharged hereunder:  (a) the rights of Holders of such Securities to receive solely from the trust fund described in Section 604 hereof, and as more fully set forth in such Section, payments in respect of the principal of, premium, if any, and interest on such Securities, when such payments are due, (b) the Company’s obligations with respect to such Securities under Sections 305, 306, 307, 402, 404, 502 and 503 hereof, (c) the rights, powers, trusts, duties and immunities of the Trustee hereunder and the Company’s obligations in connection therewith and (d) this Article Six.  Subject to compliance with this Article Six, the Company may exercise its option under this Section 602 notwithstanding the prior exercise of its option under Section 603 hereof.

SECTION 603.    Covenant Defeasance.

Upon the Company’s exercise under Section 601 hereof of the option to apply this Section 603 to the Outstanding Securities of any series, the Company shall, subject to the satisfaction of the conditions set forth in Section 604 hereof, be released from its obligations under (a) the covenants contained in Sections 504, 506, 507 and 1001 hereof and (b), if specified pursuant to Section 301(p) or Section 1101(b) hereof, any covenant established with respect to the Securities of such series pursuant to Section 301(p) or Section 1101(b) (each such covenant, including those referred to in clause (a), hereinafter a “defeasible covenant”), with respect to such Outstanding Securities on and after the date the conditions set forth in Section 604 hereof are satisfied (hereinafter, “Covenant Defeasance”), and the occurrence of an event specified in Section 701(c) and Section 701(g) with respect to such defeasible covenant shall not be deemed to be an Event of Default with respect to the Outstanding Securities of such series; and such Securities shall thereafter be deemed not “Outstanding” for the purposes of any direction, waiver, consent or declaration or Act of Holders (and the consequences of any thereof) in connection with such defeasible covenants, but shall continue to be deemed “Outstanding” for all other purposes hereunder.  For this purpose, covenant defeasance means that, with respect to the Outstanding Securities of such series, the Company may omit to comply with and shall have no liability or obligation in respect of any term, condition or limitation set forth in any such defeasible covenant whether directly or indirectly by reason of any reference elsewhere herein to any such defeasible covenant or by reason of any reference in any such defeasible covenant to any other provision herein or in any other document, but the remainder of this Indenture and such Securities shall be unaffected thereby.

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SECTION 604.    Conditions to Legal or Covenant Defeasance.

The following shall be the conditions to the application of either Section 602 or 603 hereof to the Outstanding Securities of any series:

(a)The Company shall have irrevocably deposited or caused to be deposited with the Trustee, as trust funds in trust, for the purpose of making the following payments on such Securities and specifically pledged as security for, and dedicated solely to, the benefit of the Holders of such Securities, (i) money in United States dollars in an amount, (ii) Eligible Obligations which do not contain provisions permitting the redemption or other prepayment thereof at the option of the issuer thereof, and which, through the scheduled payment of principal and interest in respect thereof in accordance with their terms, will provide, not later than one day before the due date of any payment, money in an amount, or (iii) a combination thereof, in each case sufficient, without reinvestment, in the opinion of a nationally recognized firm of independent public accountants, expressed in a written certification thereof delivered to the Trustee, to pay the principal of, premium, if any, and interest on such Securities on the due dates thereof.  Before such a deposit, the Company may make arrangements satisfactory to the Trustee for the redemption of Securities at a future date or dates in accordance with Article Four, which shall be given effect in applying the foregoing.

(b)In connection with legal defeasance election under Section 602 hereof, the Company shall have delivered to the Trustee, an Opinion of Counsel confirming that (A) the Company has received from, or there has been published by, the Internal Revenue Service a ruling or (B) since the date of this Indenture, there has been a change in the applicable federal income tax law, in either case to the effect that, and based thereon such Opinion of Counsel shall confirm that, the Holders of the outstanding Securities subject to legal defeasance will not recognize income, gain or loss for federal income tax purposes as a result of such legal defeasance and will be subject to federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such legal defeasance had not occurred;

(c)In the case of a covenant defeasance election under Section 603 hereof, the Company shall have delivered to the Trustee an Opinion of Counsel reasonably acceptable to the Trustee confirming that the Holders of the Outstanding Securities of such series will not recognize income, gain or loss for federal income tax purposes as a result of such Covenant Defeasance and will be subject to federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such covenant defeasance had not occurred;

(d)No Default or Event of Default with respect to the Securities of such series shall have occurred and be continuing (i) on the date of such deposit or (ii) insofar as Sections 701(d) or 701(e) hereof is concerned, at any time in the period ending on the 91st day after the date of deposit or, if longer, ending on the day following the expiration of the longest preference period applicable to the Company in respect of such deposit (it being understood that the condition in this clause (ii) shall not be deemed satisfied until the expiration of such period);

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(e)Such legal defeasance or covenant defeasance will not result in a breach or violation of, or constitute a default under any material agreement or instrument (other than this Indenture) to which the Company or any of its Restricted Subsidiaries is a party or by which the Company or any of its Restricted Subsidiaries is bound;

(f)Such legal defeasance or covenant defeasance shall not cause any Securities of such series then listed on any national securities exchange registered under the Exchange Act to be delisted; and

(g)The Company shall have delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel, each stating that all conditions precedent provided for or relating to the Legal Defeasance or the Covenant Defeasance have been complied with.

SECTION 605.  Miscellaneous Provisions

(a)If payment at Stated Maturity of less than all of the Securities of any series is to be provided for in the manner and with the effect provided in this Article Six, the Security Registrar shall select such Securities, or portions of principal amount thereof, in the manner specified by Section 403 for selection for redemption of less than all the Securities of a series or Tranche.

(b)In the event that Securities which shall be deemed to have been paid for purposes of this Indenture, and, if such is the case, in respect of which the Company’s indebtedness shall have been satisfied and discharged, all as provided in this Article Six, do not mature and are not to be redeemed within the sixty (60) day period commencing with the date of the deposit of moneys or Eligible Obligations, as aforesaid, the Company shall, as promptly as practicable, give a notice, in the same manner as a notice of redemption with respect to such Securities, to the Holders of such Securities to the effect that such deposit has been made and the effect thereof.

SECTION 606.    Reinstatement.

Anything herein to the contrary notwithstanding, (a) if, at any time after a Security would be deemed to have been paid for purposes of this Indenture, and, if such is the case, the Company’s indebtedness in respect thereof would be deemed to have been satisfied and discharged, pursuant to this Section (without regard to the provisions of this paragraph), the Trustee or any Paying Agent, as the case may be, (i) shall be required to return the money or Eligible Obligations, or combination thereof, deposited with it as aforesaid to the Company or its representative under any applicable Federal or State bankruptcy, insolvency or other similar law or (ii) are unable to apply any money held by the Trustee as provided in this Section and Section 603 with respect to such Security by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, such Security shall thereupon be deemed retroactively not to have been paid and any satisfaction and discharge of the Company’s indebtedness in respect thereof shall retroactively be deemed not to have been effected, and such Security shall be deemed to remain Outstanding and (b) any satisfaction and discharge of the Company’s indebtedness in respect of any Security shall be subject to the provisions of the last paragraph of Section 503.

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SECTION 607.    Satisfaction and Discharge of Indenture.

This Indenture shall upon Company Request cease to be of further effect (except as hereinafter expressly provided), and the Trustee, at the expense of the Company, shall execute such instruments as the Company shall reasonably request to evidence and acknowledge the satisfaction and discharge of this Indenture, when:

(a)no Securities remain Outstanding hereunder; and

(b)the Company has paid or caused to be paid all other sums payable hereunder by the Company;

provided, however, that if, in accordance with Section 606, any Security, previously deemed to have been paid for purposes of this Indenture, shall be deemed retroactively not to have been so paid, this Indenture shall thereupon be deemed retroactively not to have been satisfied and discharged, as aforesaid, and to remain in full force and effect, and the Company shall execute and deliver such instruments as the Trustee shall reasonably request to evidence and acknowledge the same.

Notwithstanding the satisfaction and discharge of this Indenture as aforesaid, the obligations of the Company and the Trustee under Sections 304, 305, 306, 404, 502, 503, 807 and 814 and this Article shall survive.

Upon satisfaction and discharge of this Indenture as provided in this Section, the Trustee shall turn over to the Company any and all money, securities and other property then held by the Trustee for the benefit of the Holders of the Securities (including, without limitation, all First Mortgage Bonds then held by the Trustee pursuant to this Indenture, but excluding all money and Eligible Obligations held by the Trustee pursuant to Section 607) and shall execute and deliver to the Company such instruments as, in the judgment of the Company, shall be necessary, desirable or appropriate to effect or evidence the satisfaction and discharge of this Indenture.

SECTION 608.    Application of Trust Money.

(a)Subject to the provisions of Section 503, all money and Eligible Obligations (including principal or interest payments on any such Eligible Obligations) deposited with the Trustee pursuant to Section 604 in respect of the Outstanding Securities of any series shall be held in trust and applied by the Trustee, in accordance with the provisions of such Securities and this Indenture, to the payment, either directly or through any Paying Agent (but not including the Company acting as its own Paying Agent) as the Trustee may determine, to the Holders of such Securities, of all sums due and to become due thereon in respect of principal, premium, if any, or interest, but such money need not be segregated from other funds except to the extent required by law.

(b)So long as there shall not have occurred and be continuing any Default or Event of Default, the Trustee shall deliver or pay to the Company from time to time upon Company Request any money or Eligible Obligations (or other property and any proceeds therefrom) held by it as provided in Section 604 which, in the opinion of a nationally

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recognized firm of independent public accountants expressed in a written certification thereof delivered to the Trustee, are in excess of the amount thereof which would then be required to be deposited to effect an equivalent legal defeasance or covenant defeasance, as applicable, in accordance with this Article; provided that, if any Default or Event of Default shall have occurred and be continuing, moneys to be paid over to the Company pursuant to this clause (b), shall be held until such Default or Event of Default shall have been waived or cured.

(c)The Company shall pay and indemnify the Trustee against any tax, fee or other charge imposed on or assessed against the money or Eligible Obligations deposited pursuant to Section 604 or the principal and interest received in respect thereof.

ARTICLE SEVEN

Events of Default; Remedies

SECTION 701.    Events of Default.

“Event of Default”, wherever used herein with respect to the Securities of any series, means any of the following events:

(a)failure to pay interest, if any, on any Security of such series, within thirty (30) days after the same becomes due and payable; or

(b)failure to pay the principal of or premium, if any, on any Security of such series when due; or

(c)failure by the Company or any of its Restricted Subsidiaries to perform, or breach of, any covenant or warranty of the Company or such Restricted Subsidiary in this Indenture (other than a covenant or warranty, a default in the performance of which or breach of which is elsewhere in this Section specifically dealt with or which has expressly been included in this Indenture solely for the benefit of one or more series of Securities other than such series) for a period of sixty (60) days after there has been given, by registered or certified mail, to the Company by the Trustee, or to the Company and the Trustee by the Holders of at least twenty-five percentum (25%) in principal amount of the Outstanding Securities of such series, a written notice specifying such default or breach and requiring it to be remedied and stating that such notice is a “Notice of Default” hereunder; or

(d)the entry by a court having jurisdiction in the premises of (i) a decree or order for relief in respect of the Company in an involuntary case or proceeding under any applicable Federal or State bankruptcy, insolvency, reorganization or other similar law or (ii) a decree or order adjudging the Company a bankrupt or insolvent, or approving as properly filed a petition by one or more Persons other than the Company seeking reorganization, arrangement, adjustment or composition of or in respect of the Company under any applicable Federal or State law, or appointing a custodian, receiver, liquidator, assignee, trustee, sequestrator or other similar official for the Company or for any substantial part of its property, or ordering the winding-up or liquidation of its affairs, and any such decree or order for relief or any such other decree or order shall have remained unstayed and in effect for a period of ninety (90) consecutive days; or

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(e)the commencement by the Company of a voluntary case or proceeding under any applicable Federal or State bankruptcy, insolvency, reorganization or other similar law or of any other case or proceeding to be adjudicated a bankrupt or insolvent, or the consent by it to the entry of a decree or order for relief in respect of the Company in a case or proceeding under any applicable Federal or State bankruptcy, insolvency, reorganization or other similar law or to the commencement of any bankruptcy or insolvency case or proceeding against it, or the filing by it of a petition or answer or consent seeking reorganization or relief under any applicable Federal or State law, or the consent by it to the filing of such petition or to the appointment of or taking possession by a custodian, receiver, liquidator, assignee, trustee, sequestrator or similar official of the Company or of any substantial part of its property, or the making by it of an assignment for the benefit of creditors, or the admission by it in writing of its inability to pay its debts generally as they become due, or the authorization of such action by the Board of Directors; or

(f)the occurrence of an “Event of Default” under the South Dakota Mortgage or a “Default” under the Montana Mortgage; provided that the waiver or cure of such “Event of Default” under the South Dakota Mortgage or such “Default” under the Montana Mortgage, as the case may be, and the rescission and annulment of the consequences thereof under such Mortgage, in each case in accordance with the terms of such Mortgage, shall constitute a cure of the corresponding Event of Default under this Indenture and a rescission and annulment of the consequences thereof; or

(g)any other Event of Default specified with respect to such Securities as contemplated by Section 301(o) or Section 1101(c).

SECTION 702.    Acceleration of Maturity; Rescission and Annulment.

If an Event of Default (other than an Event of Default specified in clause (d) or (e) of Section 701 hereof) shall have occurred and be continuing with respect to Securities of any series at the time Outstanding, then in every such case the Trustee or the Holders of not less than twenty-five percentum (25%) in principal amount of the Outstanding Securities of such series may declare the principal amount (or, if any of the Outstanding Securities of such series are Discount Securities, such portion of the principal amount of such Securities as may be specified in the terms thereof as contemplated by Section 301) of all of the Outstanding Securities of such series to be due and payable immediately, by a notice in writing to the Company (and to the Trustee if given by Holders), and upon such declaration such principal amount (or specified amount), together with premium, if any, and accrued interest, if any, thereon, shall become immediately due and payable.  Notwithstanding the foregoing, if an Event of Default specified in clause (d) or (e) of Section 701 occurs, all Outstanding Securities shall be due and payable immediately without further notice.  Upon any acceleration of the Securities of any series pursuant to this paragraph, the Trustee immediately shall file with the trustee(s) under the Mortgage(s) pertaining to the related First Mortgage Bonds (with a copy to the Company) a written demand for redemption of the related First Mortgage Bonds.

At any time after such a declaration of acceleration of the maturity of the Securities then Outstanding shall have been made, but before a decree or judgment for payment of the money due shall have been obtained by the Trustee as provided in this Article, the Holders

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of a majority in principal amount of the Securities then Outstanding, by written notice to the Company and the Trustee may rescind and annul such acceleration and its consequences, if

(a)the Company shall have paid or deposited with the Trustee a sum sufficient to pay

(i)all installments of interest, if any, which have become due on all Securities of such series then Outstanding, together with interest, if any, thereon, at the rate or rates prescribed therefor in such Securities, to the extent that payment of such interest is lawful;

(ii)the principal of and premium, if any, on any Securities of such series then Outstanding which have become due otherwise than by such declaration of acceleration and interest, if any, thereon at the rate or rates prescribed therefor in such Securities; and

(iii)all amounts due to the Trustee under Section 807; and

(b)all Events of Default with respect to Securities of such series, other than the non-payment of the principal of Securities of such series which shall have become due solely by such declaration of acceleration, shall have been cured or waived as provided in Section 713.

No such rescission shall affect any subsequent Event of Default or impair any right consequent thereon.

Upon any rescission of any acceleration of the Securities of any series pursuant to this Section, the Trustee immediately shall file with the trustee(s) under the Mortgage(s) pertaining to the related First Mortgage Bonds, a written notice of such rescission.

SECTION 703.    Collection of Indebtedness and Suits for Enforcement by Trustee.

If an Event of Default described in clause (a) or (b) of Section 701 shall have occurred and be continuing, the Company shall, upon demand of the Trustee, pay to it, for the benefit of the Holders of the Securities with respect to which such Event of Default shall have occurred, the whole amount then due and payable on such Securities for principal and premium, if any, and interest, if any, and, to the extent permitted by law, interest on overdue principal, premium and interest at the rate or rates prescribed therefore in such Securities, and, in addition thereto, such further amount as shall be sufficient to cover any amounts due to the Trustee under Section 807.

If the Company shall fail to pay such amounts forthwith upon such demand, the Trustee, in its own name and as trustee of an express trust, may institute a judicial proceeding for the collection of the sums so due and unpaid, may prosecute such proceeding to judgment or final decree and may enforce the same against the Company or any other obligor upon such Securities and collect the moneys adjudged or decreed to be payable in the manner provided by law out of the property of the Company or any other obligor upon such Securities, wherever situated.

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If an Event of Default with respect to Securities of any series shall have occurred and be continuing, the Trustee may in its discretion proceed to protect and enforce its rights and the rights of the Holders of the Outstanding Securities by such appropriate judicial proceedings as the Trustee shall deem most effectual to protect and enforce any such rights, whether for the specific enforcement of any covenant or agreement in this Indenture or in aid of the exercise of any power granted herein, or to enforce any other proper remedy.

SECTION 704.    Application of Money Collected.

Any money collected by the Trustee pursuant to this Article shall be applied in the following order, to the extent permitted by law, at the date or dates fixed by the Trustee and, in case of the distribution of such money on account of principal or premium, if any, or interest, if any, upon presentation of the Securities and the notation thereon of the payment if only partially paid and upon surrender thereof if fully paid:

First:  To the payment of all amounts due the Trustee under Section 807;

Second:  To the payment of the whole amount then due and unpaid upon the Outstanding Securities for principal and premium, if any, and interest, if any, in respect of which or for the benefit of which such money has been collected; and in case such proceeds shall be insufficient to pay in full the whole amount so due and unpaid upon such Securities, then to the payment of such principal and interest, if any, thereon without any preference or priority, ratably according to the aggregate amount so due and unpaid, with any balance then remaining to the payment of premium, if any, and, if so specified as contemplated by Section 301 with respect to the Securities of any series, or any Tranche thereof, interest, if any, on overdue premium, if any, and overdue interest, if any, ratably as aforesaid, all to the extent permitted by applicable law;

Third:  To the payment of the remainder, if any, to the Company or to whomsoever may be lawfully entitled to receive the same or as a court of competent jurisdiction may direct.

SECTION 705.    Trustee May File Proofs of Claim.

In case of the pendency of any receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or other judicial proceeding relative to the Company or any other obligor upon the Securities or the property of the Company or of such other obligor or their creditors, the Trustee shall be entitled and empowered, by intervention in such proceeding or otherwise,

(a)to file and prove a claim for the whole amount of principal, premium, if any, and interest, if any, owing and unpaid in respect of the Securities and to file such other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for amounts due to the Trustee under Section 807) and of the Holders allowed in such judicial proceeding, and

(b)to collect and receive any moneys or other property payable or deliverable on any such claims and to distribute the same;

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and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Holder to make such payments to the Trustee and, in the event that the Trustee shall consent to the making of such payments directly to the Holders, to pay to the Trustee any amounts due it under Section 807.

Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement, adjustment or composition affecting the Securities or the rights of any Holder thereof or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding; provided, however, that the Trustee may, on behalf of the Holders, be a member of a creditors’ or other similar committee.

SECTION 706.    Trustee May Enforce Claims without Possession of Securities.

All rights of action and claims under this Indenture or on the Securities may be prosecuted and enforced by the Trustee without the possession of any of the Securities or the production thereof in any proceeding relating thereto, and any such proceeding instituted by the Trustee shall be brought in its own name as trustee of an express trust, and any recovery of judgment shall, after provision for the payment of the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, be for the ratable benefit of the Holders in respect of which such judgment has been recovered.

SECTION 707.    Limitation on Suits.

No Holder of any Security of any series shall have any right to institute any proceeding, judicial or otherwise, with respect to this Indenture, or for the appointment of a receiver or trustee, or for any other remedy hereunder, unless:

(a)such Holder shall have previously given written notice to the Trustee of a continuing Event of Default;

(b)the Holders of twenty-five percent (25%) in aggregate principal amount of the Outstanding Securities of all series in respect of which an Event of Default shall have occurred and is continuing shall have made written request to the Trustee to institute proceedings in respect of such Event of Default in its own name as Trustee hereunder;

(c)such Holder or Holders shall have offered to the Trustee reasonable indemnity against the costs, expenses and liabilities to be incurred in compliance with such request;

(d)the Trustee for sixty (60) days after its receipt of such notice, request and offer of indemnity shall have failed to institute any such proceeding; and

(e)no direction inconsistent with such written request shall have been given to the Trustee during such sixty (60) day period by the Holders of a majority in aggregate principal amount of the Outstanding Securities of all series in respect of which an Event of Default shall have occurred and be continuing, considered as one class.

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it being understood and intended that no one or more of the Holders of any Securities shall have any right in any manner whatever by virtue of, or by availing of, any provision of this Indenture to affect, disturb or prejudice the rights of any other Holders or to obtain or to seek to obtain priority or preference over any other Holders or to enforce any right under this Indenture, except in the manner herein provided and for the equal and ratable benefit of all Holders.

SECTION 708.    Unconditional Right of Holders to Receive Principal, Premium and Interest.

Notwithstanding any other provision in this Indenture, the Holder of any Security shall have the right, which is absolute and unconditional, to receive payment of the principal of and premium, if any, and (subject to Section 307) interest, if any, on such Security on the Stated Maturity or Maturities expressed in such Security (or, in the case of redemption, on the Redemption Date) and to institute suit for the enforcement of any such payment, and such rights shall not be impaired without the consent of such Holder.

SECTION 709.    Restoration of Rights and Remedies.

If the Trustee or any Holder has instituted any proceeding to enforce any right or remedy under this Indenture and such proceeding shall have been discontinued or abandoned for any reason, or shall have been determined adversely to the Trustee or to such Holder, then and in every such case, subject to any determination in such proceeding, the Company, the Trustee and such Holder shall be restored severally and respectively to their former positions hereunder and thereafter all rights and remedies of the Trustee and such Holder shall continue as though no such proceeding had been instituted.

SECTION 710.    Rights and Remedies Cumulative.

Except as otherwise provided in the last paragraph of Section 306, no right or remedy herein conferred upon or reserved to the Trustee or to the Holders is intended to be exclusive of any other right or remedy, and every right and remedy shall, to the extent permitted by law, be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise.  The assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other appropriate right or remedy.

SECTION 711.    Delay or Omission Not Waiver.

No delay or omission of the Trustee or of any Holder to exercise any right or remedy accruing upon any Event of Default shall impair any such right or remedy or constitute a waiver of any such Event of Default or an acquiescence therein.  Every right and remedy given by this Article or by law to the Trustee or to the Holders may be exercised from time to time, and as often as may be deemed expedient, by the Trustee or by the Holders, as the case may be.

SECTION 712.    Control by Holders of Securities.

If an Event of Default shall have occurred and be continuing in respect of a series of Securities, the Holders of a majority in principal amount of the Outstanding Securities of such

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series shall have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred on the Trustee with respect to the Securities of such series; provided, however, that if an Event of Default shall have occurred and be continuing with respect to more than one series of Securities, the Holders of a majority in aggregate principal amount of the Outstanding Securities of all such series, considered as one class, shall have the right to make such direction, and not the Holders of any one such series; and provided further, that

(a)such direction shall not be in conflict with any rule of law or with this Indenture, and could not involve the Trustee in personal liability in circumstances where indemnity would not, in the Trustee’s sole discretion, be adequate,

(b)Trustee shall not determine that the action so directed would be unjustly prejudicial to the Holders not taking part in such direction, and

(c)the Trustee may take any other action deemed proper by the Trustee which is not inconsistent with such direction.

SECTION 713.    Waiver of Past Defaults.

The Holders of a majority in principal amount of the Outstanding Securities of any series may on behalf of the Holders of all the Outstanding Securities of such series waive any past default hereunder with respect to such series and its consequences, except a default

(a)in the payment of the principal of or premium, if any, or interest, if any, on any Security of such series, or

(b)in respect of a covenant or provision hereof which under Section 1102 cannot be modified or amended without the consent of the Holder of each Outstanding Security of such series affected.

Upon any such waiver, such default shall cease to exist, and any and all Events of Default arising therefrom shall be deemed to have been cured, for every purpose of this Indenture; but no such waiver shall extend to any subsequent or other default or impair any right consequent thereon.

SECTION 714.    Undertaking for Costs.

The Company and the Trustee agree, and each Holder by its acceptance of a Security shall be deemed to have agreed, that any court may in its discretion require, in any suit for the enforcement of any right or remedy under this Indenture, or in any suit against the Trustee for any action taken, suffered or omitted by it as Trustee, the filing by any party litigant in such suit of an undertaking to pay the costs of such suit, and that such court may in its discretion assess reasonable costs, including reasonable attorneys’ fees, against any party litigant in such suit, having due regard to the merits and good faith of the claims or defenses made by such party litigant, all in the manner, to the extent and except as provided in the Trust Indenture Act; but the provisions of this Section shall not apply to any suit instituted by the Company, to any suit instituted by the Trustee, to any suit instituted by any Holder, or group of Holders, holding in the

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aggregate more than ten percentum (10%) in aggregate principal amount of the Securities then Outstanding, or to any suit instituted by any Holder for the enforcement of the payment of the principal of or premium, if any, or interest, if any, on any Security on or after the Stated Maturity or Maturities expressed in such Security (or, in the case of redemption, on or after the Redemption Date).

SECTION 715.    Waiver of Stay or Extension Laws.

To the full extent that it may lawfully so agree, the Company shall not at any time set up, claim or otherwise seek to take the benefit or advantage of any stay or extension law, now or hereafter in effect, in order to prevent or hinder the enforcement of this Indenture; and the Company, for itself and all who may claim under it, so far as it or they now or hereafter may lawfully do so, hereby waives the benefit of all such laws.

SECTION 716.    Defaults under Mortgages.

In addition to every other right and remedy provided herein, the Trustee may (but shall not be obligated to) exercise any right or remedy available to the Trustee in its capacity as owner and holder of First Mortgage Bonds which arises as a result of a default or matured event of default under any Mortgage, whether or not an Event of Default shall then have occurred and be continuing.

ARTICLE EIGHT

The Trustee

SECTION 801.Certain Duties and Responsibilities.

(a)Except during the continuance of an Event of Default,

(i)the Trustee undertakes to perform, such duties and only such duties as are specifically set forth in this Indenture, and no implied covenants or obligations shall be read into this Indenture against the Trustee; and

(ii)in the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture; but in the case of any such certificates or opinions which by any provisions hereof are specifically required to be furnished to the Trustee, the Trustee shall be under a duty to examine the same to determine whether or not they conform to the requirements of this Indenture.

(b)In case an Event of Default shall have occurred and be continuing, the Trustee shall exercise such of the rights and powers vested in it by this Indenture, and use the same degree of care and skill in their exercise, as a prudent man would exercise or use under the circumstances in the conduct of his own affairs.

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(c)No provision of this Indenture shall be construed to relieve the Trustee from liability for its own negligent action, its own negligent failure to act, or its own willful misconduct, except that:

(i)this subsection shall not be construed to limit the effect of subsection (a) of this Section;

(ii)the Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer, unless it shall be proved that the Trustee was negligent in ascertaining the pertinent facts;

(iii)the Trustee shall not be liable with respect to any action taken or omitted to be taken by it in good faith in accordance with the direction of the Holders of a majority in principal amount of the Outstanding Securities, of any one or more series as provided herein, relating to the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred upon the Trustee, under this Indenture with respect to the Securities of such series; and

(iv)no provision of this Indenture shall require the Trustee to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder, or in the exercise of any of its rights or powers, if it shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it.

(d)Whether or not therein expressly so provided, every provision of this Indenture relating to the conduct or affecting the liability of or affording protection to the Trustee shall be subject to the provisions of this Section.

SECTION 802.    Notice of Defaults.

The Trustee shall give the Holders notice of any default hereunder in the manner and to the extent required to do so by the Trust Indenture Act, unless such default shall have been cured or waived.  For the purpose of this Section, the term “default” means any event which is, or after notice or lapse of time, or both, would become, an Event of Default with respect to the Securities of any series.  The Trustee shall give to the trustee under each Mortgage a copy of each notice of default given to the Holders pursuant to this Section.  In addition, the Trustee shall give to the Holders copies of each notice of default under any Mortgage given to the Trustee in its capacity as owner and holder of First Mortgage Bonds delivered thereunder.

SECTION 803.    Certain Rights of Trustee.

Subject to the provisions of Section 801 and to the applicable provisions of the Trust Indenture Act:

(a)the Trustee may rely and shall be protected in acting or refraining from acting upon any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other

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paper or document believed by it to be genuine and to have been signed, sent or presented by the proper party or parties;

(b)any request, direction or act of the Company mentioned herein shall be sufficiently evidenced by a Company Request or Company Order, or as otherwise expressly provided herein, and any resolution of the Board of Directors may be sufficiently evidenced by a Board Resolution;

(c)whenever in the administration of this Indenture the Trustee shall deem it desirable that a matter be proved or established prior to taking, suffering or omitting any action hereunder, the Trustee (unless other evidence is specifically prescribed herein) may, in the absence of bad faith on its part, rely upon an Officer’s Certificate;

(d)the Trustee may consult with counsel and the written advice of such counsel or any Opinion of Counsel shall be full and complete authorization and protection in respect of any action taken, suffered or omitted by it hereunder in good faith and in reliance thereon;

(e)the Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request or direction of any Holder pursuant to this Indenture, unless such Holder shall have offered to the Trustee reasonable security or indemnity against the costs, expenses and liabilities which might be incurred by it in compliance with such request or direction;

(f)the Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document, but the Trustee, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit, and, if the Trustee shall determine to make such further inquiry or investigation, it shall (subject to applicable legal requirements) be entitled to examine, during normal business hours, the books, records and premises of the Company, personally or by agent or attorney;

(g)the Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents or attorneys and the Trustee shall not be responsible for any misconduct or negligence on the part of any agent or attorney appointed with due care by it hereunder; and

(h)the Trustee shall have no duty to inquire as to the performance of the Company with respect to the covenants contained in Article 5; and the Trustee shall not be charged with knowledge of any Event of Default with respect to the Securities of any series, unless (i) a Responsible Officer of the Trustee shall have actual knowledge of the Default or Event of Default or (ii) the Event of Default has occurred pursuant to Sections 7.01(a) or 7.01(b) or (iii) written notice of such Event of Default shall have been given to the Trustee by the Company, any other obligor on such Securities or by any Holder of such Securities or, in the case of a default described in Section 701(f), from the holder of any indebtedness or from the trustee under any mortgage or other instrument referred to in such Section.

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SECTION 804.    Not Responsible for Recitals or Issuance of Securities.

The recitals contained herein and in the Securities (except the Trustee’s certificates of authentication) shall be taken as the statements of the Company, and neither the Trustee nor any Authenticating Agent assumes any responsibility for their correctness.  The Trustee makes no representations as to the validity or sufficiency of this Indenture or of the Securities.  Neither the Trustee nor any Authenticating Agent shall be accountable for the use or application by the Company of Securities or the proceeds thereof.

SECTION 805.    May Hold Securities.

Each of the Trustee, any Authenticating Agent, any Paying Agent, any Security Registrar or any other agent of the Company or the Trustee, in its individual or any other capacity, may become the owner or pledgee of Securities and, subject to Sections 808 and 813, may otherwise deal with the Company with the same rights it would have if it were not such Trustee, Authenticating Agent, Paying Agent, Security Registrar or other agent.

SECTION 806.    Money Held in Trust.

Money held by the Trustee in trust hereunder need not be segregated from other funds, except to the extent required by law.  The Trustee shall be under no liability for interest on or investment of any money received by it hereunder except as expressly provided herein or otherwise agreed with, and for the sole benefit of, the Company.

SECTION 807.    Compensation and Reimbursement.

The Company shall

(a)pay to the Trustee from time to time reasonable compensation as may be agreed with the Company for all services rendered by it hereunder (which compensation shall not be limited by any provision of law in regard to the compensation of a trustee of an express trust);

(b)except as otherwise expressly provided herein, reimburse the Trustee upon its request for all reasonable out-of-pocket expenses, disbursements and advances reasonably incurred or made by the Trustee in accordance with any provision of this Indenture (including the reasonable compensation and the expenses and disbursements of its agents and counsel), except to the extent that any such expense, disbursement or advance may be attributable to its negligence, willful misconduct or bad faith; and

(c)indemnify the Trustee and hold it harmless from and against any loss, liability or expense reasonably incurred by it arising out of or in connection with the acceptance or administration of the trust or trusts hereunder or the performance of its duties hereunder, including the reasonable costs and expenses of defending itself against any claim or liability in connection with the exercise or performance of any of its powers or duties hereunder, except to the extent any such loss, liability or expense may be attributable to its negligence, willful misconduct or bad faith.

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As security for the performance of the obligations of the Company under this Section, the Trustee shall have a lien prior to the Securities upon all property and funds held or collected by the Trustee as such other than property and funds held in trust under Section 603 (except moneys payable to the Company as provided in Section 603).  “Trustee” for purposes of this Section shall include any predecessor Trustee; provided, however, that the negligence, willful misconduct or bad faith of any Trustee hereunder shall not affect the rights of any other Trustee hereunder.

SECTION 808.    Disqualification; Conflicting Interests.

If the Trustee has or shall acquire any conflicting interest within the meaning of the Trust Indenture Act, it shall either eliminate such conflicting interest or resign to the extent, in the manner and with the effect, and subject to the conditions, provided in the Trust Indenture Act and this Indenture.  For purposes of Section 310(b)(1) of the Trust Indenture Act and to the extent permitted thereby, the Trustee, in its capacity as trustee in respect of the Securities of any series, shall not be deemed to have a conflicting interest arising from its capacity as trustee in respect of the Securities of any other series.

SECTION 809.    Corporate Trustee Required; Eligibility.

There shall at all times be a Trustee hereunder which shall be

(a)a corporation organized and doing business under the laws of the United States, any State or Territory thereof or the District of Columbia, authorized under such laws to exercise corporate trust powers, having a combined capital and surplus of at least Fifty Million Dollars ($50,000,000) and subject to supervision or examination by Federal, State, Territorial or District of Columbia authority, or

(b)if and to the extent permitted by the Commission by rule, regulation or order upon application, a corporation or other Person organized and doing business under the laws of a foreign government, authorized under such laws to exercise corporate trust powers, having a combined capital and surplus of at least Fifty Million Dollars ($50,000,000) or the Dollar equivalent of the applicable foreign currency and subject to supervision or examination by authority of such foreign government or a political subdivision thereof substantially equivalent to supervision or examination applicable to United States institutional trustees,

and, in either case, qualified and eligible under this Article and the Trust Indenture Act.  If such corporation publishes reports of condition at least annually, pursuant to law or to the requirements of such supervising or examining authority, then for the purposes of this Section, the combined capital and surplus of such corporation shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published.  If at any time the Trustee shall cease to be eligible in accordance with the provisions of this Section or the Trust Indenture Act, it shall resign immediately in the manner and with the effect hereinafter specified in this Article.

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SECTION 810.Resignation and Removal; Appointment of Successor.

(a)No resignation or removal of the Trustee and no appointment of a successor Trustee pursuant to this Article shall become effective until the acceptance of appointment by the successor Trustee in accordance with the applicable requirements of Section 811.

(b)The Trustee may resign at any time with respect to the Securities of one or more series by giving written notice thereof to the Company.  If the instrument of acceptance by a successor Trustee required by Section 811 shall not have been delivered to the Trustee within thirty (30) days after the giving of such notice of resignation, the resigning Trustee may petition any court of competent jurisdiction for the appointment of a successor Trustee.

(c)The Trustee may be removed at any time with respect to the Securities of one or more series by Act of the Holders of a majority in principal amount of the Outstanding Securities of such series delivered to the Trustee and to the Company.

(d)If at any time:

(i)the Trustee shall fail to comply with Section 808 after written request therefor by the Company or by any Holder who has been a bona fide Holder for at least six months, or

(ii)the Trustee shall cease to be eligible under Section 809 or Section 310(a) of the Trust Indenture Act and shall fail to resign after written request therefor by the Company or by any such Holder, or

(iii)the Trustee shall become incapable of acting or shall be adjudged a bankrupt or insolvent or a receiver of the Trustee or of its property shall be appointed or any public officer shall take charge or control of the Trustee or of its property or affairs for the purpose of rehabilitation, conservation or liquidation,

then, in any such case, (x) the Company by Board Resolution may remove the Trustee with respect to all Securities or (y) subject to Section 714, any Holder who has been a bona fide Holder for at least six (6) months may, on behalf of itself and all others similarly situated, petition any court of competent jurisdiction for the removal of the Trustee with respect to all series and the appointment of a successor Trustee or Trustees.

(e)If the Trustee shall resign, be removed or become incapable of acting, or if a vacancy shall occur in the office of Trustee for any cause (other than as contemplated in clause (y) in subsection (d) of this Section), with respect to the Securities of one or more series the Company, by Board Resolution, shall take prompt steps to appoint a successor Trustee or Trustees with respect to the Securities of such series and shall comply with the applicable requirements of Section 811.  If, within one (1) year after such resignation, removal or incapability, or the occurrence of such vacancy, a successor Trustee with respect to the Securities of one or more series shall be appointed by Act of the Holders of a majority in principal amount of the Outstanding Securities of such series delivered to the Company and the retiring Trustee, the successor Trustee so appointed shall, forthwith upon its

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acceptance of such appointment in accordance with the applicable requirements of Section 811, become the successor Trustee with respect to the Securities of such series and to that extent supersede the successor Trustee appointed by the Company.  If no successor Trustee with respect to such Securities shall have been so appointed by the Company or the Holders and accepted appointment in the manner required by Section 811, any Holder who has been a bona fide Holder of a Security of such series for at least six (6) months may, on behalf of itself and all others similarly situated, petition any court of competent jurisdiction for the appointment of a successor Trustee with respect to the Securities of such series.

(f)The Company shall give notice of each resignation and each removal of the Trustee and each appointment of a successor Trustee to all Holders of Securities.  Each notice shall include the name of the successor Trustee and the address of its corporate trust office.

SECTION 811.Acceptance of Appointment by Successor.

(a)In case of the appointment hereunder of a successor Trustee with respect to the Securities of all series, every such successor Trustee so appointed shall execute, acknowledge and deliver to the Company and to the retiring Trustee an instrument accepting such appointment, and thereupon the resignation or removal of the retiring Trustee shall become effective and such successor Trustee, without any further act, shall become vested with all the rights, powers, trusts and duties of the retiring Trustee; but, on the request of the Company or the successor Trustee, such retiring Trustee shall, upon payment of all sums owed to it, execute and deliver an instrument transferring to such successor Trustee all the rights, powers and trusts of the retiring Trustee and shall assign and transfer to such successor Trustee all First Mortgage Bonds then held by the retiring Trustee pursuant to this Indenture in accordance with all requirements of such First Mortgage Bonds and the related Mortgage(s) and duly assign, transfer and deliver to such successor Trustee all other property and all money held by such retiring Trustee hereunder.

(b)Upon the request of any such successor Trustee, the Company shall execute instruments to more fully and certainly vest in and confirm to such successor Trustee all rights, powers and trusts referred to in subsection (a) of this Section.

(c)No successor Trustee shall accept its appointment unless at the time of such acceptance such successor Trustee shall be qualified and eligible under this Article.

SECTION 812.    Merger, Conversion, Consolidation or Succession to Business.

Any corporation into which the Trustee may be merged or converted or with which it may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which the Trustee shall be a party, or any corporation succeeding to all or substantially all the corporate trust business of the Trustee, shall be the successor of the Trustee hereunder, provided such corporation shall be otherwise qualified and eligible under this Article, without the execution or filing of any paper or any further act on the part of any of the parties hereto.  In case any Securities shall have been authenticated, but not delivered, by the Trustee then in office, any successor by merger, conversion or consolidation to such authenticating

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Trustee may adopt such authentication and deliver the Securities so authenticated with the same effect as if such successor Trustee had itself authenticated such Securities.

SECTION 813.    Preferential Collection of Claims against Company.

If the Trustee shall be or become a creditor of the Company or any other obligor upon the Securities (other than by reason of a relationship described in Section 311(b) of the Trust Indenture Act), the Trustee shall be subject to any and all applicable provisions of the Trust Indenture Act regarding the collection of claims against the Company or such other obligor.  For purposes of Section 311(b) of the Trust Indenture Act:  (a) the term “cash transaction” shall have the meaning provided in Rule 11b4 under the Trust Indenture Act; and (b) the term “self-liquidating paper” shall have the meaning provided in Rule 11b6 under the Trust Indenture Act.

SECTION 814.    Appointment of Authenticating Agent.

The Trustee may appoint an Authenticating Agent or Agents acceptable to the Company with respect to the Securities of one or more series, or any Tranche thereof, which shall be authorized to act on behalf of the Trustee to authenticate Securities of such series or Tranche issued upon original issuance, exchange, registration of transfer or partial redemption thereof or pursuant to Section 306, and Securities so authenticated shall be entitled to the benefits of this Indenture and shall be valid and obligatory for all purposes as if authenticated by the Trustee hereunder.  Wherever reference is made in this Indenture to the authentication and delivery of Securities by the Trustee or the Trustee’s certificate of authentication, such reference shall be deemed to include authentication and delivery on behalf of the Trustee by an Authenticating Agent and a certificate of authentication executed on behalf of the Trustee by an Authenticating Agent.  Each Authenticating Agent shall be acceptable to the Company and shall at all times be a corporation organized and doing business under the laws of the United States, any State or Territory thereof or the District of Columbia or the Commonwealth of Puerto Rico, authorized under such laws to act as Authenticating Agent, having a combined capital and surplus of not less than Fifty Million Dollars ($50,000,000) and subject to supervision or examination by Federal or State authority.  If such Authenticating Agent publishes reports of condition at least annually, pursuant to law or to the requirements of said supervising or examining authority, then for the purposes of this Section, the combined capital and surplus of such Authenticating Agent shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published.  If at any time an Authenticating Agent shall cease to be eligible in accordance with the provisions of this Section, such Authenticating Agent shall resign immediately in the manner and with the effect specified in this Section.

Any corporation into which an Authenticating Agent may be merged or converted or with which it may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which such Authenticating Agent shall be a party, or any corporation succeeding to all or substantially all of the corporate agency or corporate trust business of an Authenticating Agent, shall continue to be an Authenticating Agent, provided such corporation shall be otherwise eligible under this Section, without the execution or filing of any paper or any further act on the part of the Trustee or the Authenticating Agent.

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An Authenticating Agent may resign at any time by giving written notice thereof to the Trustee and to the Company.  The Trustee may (and, upon the request of the Company, shall) at any time terminate the agency of an Authenticating Agent by giving written notice thereof to such Authenticating Agent and to the Company.  Upon receiving such a notice of resignation or upon such a termination, or in case at any time such Authenticating Agent shall cease to be eligible in accordance with the provisions of this Section, the Trustee may appoint a successor Authenticating Agent which shall be acceptable to the Company.  Any successor Authenticating Agent upon acceptance of its appointment hereunder shall become vested with all the rights, powers and duties of its predecessor hereunder, with like effect as if originally named as an Authenticating Agent.  No successor Authenticating Agent shall be appointed unless eligible under the provisions of this Section.

The Company agrees to pay to each Authenticating Agent from time to time reasonable compensation as agreed with the Company for its services under this Section.

The provisions of Sections 308, 804 and 805 shall be applicable to each Authenticating Agent.

If an appointment with respect to the Securities of one or more series, or any Tranche thereof, shall be made pursuant to this Section, the Securities of such series or Tranche may have endorsed thereon, in addition to the Trustee’s certificate of authentication, an alternate certificate of authentication substantially in the following form:

This is one of the Securities of the series designated therein referred to in the within-mentioned Indenture.

As Trustee

By

As Authenticating Agent

By

Authorized Officer

If all of the Securities of a series may not be originally issued at one time, and if the Trustee does not have an office capable of authenticating Securities upon original issuance located in a Place of Payment where the Company wishes to have Securities of such series authenticated upon original issuance, the Trustee, if so requested by the Company in writing (which writing need not comply with Section 102 and need not be accompanied by an Opinion of Counsel), shall appoint, in accordance with this Section and in accordance with such procedures as shall be acceptable to the Trustee, an Authenticating Agent having an office in a Place of Payment designated by the Company with respect to such series of Securities.

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SECTION 815.    Co-trustee and Separate Trustees.

At any time or times, for the purpose of meeting the legal requirements of any applicable jurisdiction, the Company and the Trustee shall have power to appoint, and, upon the written request of the Trustee or of the Holders of at least 25% in principal amount of the Outstanding Securities, the Company shall for such purpose join with the Trustee in the execution and delivery of all instruments and agreements necessary or proper to appoint, one or more Persons approved by the Trustee either to act as co-trustee, jointly with the Trustee, or to act as separate trustee, in either case with such powers as may be provided in the instrument of appointment, and to vest in such Person or Persons, in the capacity aforesaid, any property, title, right or power deemed necessary or desirable, subject to the other provisions of this Section.  If the Company does not join in such appointment within 15 days after the receipt by it of a request so to do, or if an Event of Default shall have occurred and be continuing, the Trustee alone shall have power to make such appointment.

Should any written instrument or instruments from the Company be required by any co-trustee or separate trustee to more fully confirm to such co-trustee or separate trustee such property, title, right or power, any and all such instruments shall, on request, be executed, acknowledged and delivered by the Company.

Every co-trustee or separate trustee shall, to the extent permitted by law, but to such extent only, be appointed subject to the following conditions:

(a)the Securities shall be authenticated and delivered, and all rights, powers, duties and obligations hereunder in respect of the custody of securities, cash and other personal property held by, or required to be deposited or pledged with, the Trustee hereunder, shall be exercised solely, by the Trustee;

(b)the rights, powers, duties and obligations hereby conferred or imposed upon the Trustee in respect of any property covered by such appointment shall be conferred or imposed upon and exercised or performed either by the Trustee or by the Trustee and such co-trustee or separate trustee jointly, as shall be provided in the instrument appointing such co-trustee or separate trustee, except to the extent that under any law of any jurisdiction in which any particular act is to be performed, the Trustee shall be incompetent or unqualified to perform such act, in which event such rights, powers, duties and obligations shall be exercised and performed by such co-trustee or separate trustee.

(c)the Trustee at any time, by an instrument in writing executed by it, with the concurrence of the Company, may accept the resignation of or remove any co-trustee or separate trustee appointed under this Section, and, if an Event of Default shall have occurred and be continuing, the Trustee shall have power to accept the resignation of, or remove, any such co-trustee or separate trustee without the concurrence of the Company.  Upon the written request of the Trustee, the Company shall join with the Trustee in the execution and delivery of all instruments and agreements necessary or proper to effectuate such resignation or removal.  A successor to any co-trustee or separate trustee so resigned or removed may be appointed in the manner provided in this Section;

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(d)no co-trustee or separate trustee hereunder shall be personally liable by reason of any act or omission of the Trustee, or any other such trustee hereunder, and the Trustee shall not be personally liable by reason of any act or omission of any such co-trustee or separate trustee; and

(e)any Act of Holders delivered to the Trustee shall be deemed to have been delivered to each such co-trustee and separate trustee.

ARTICLE NINE

Lists of Holders; Reports by Trustee and Company

SECTION 901.    Lists of Holders.

Semiannually, not later than June 30 and December 31 in each year, commencing June 30, 2005, and within 30 days of such other times as the Trustee may request in writing, the Company shall furnish or cause to be furnished to the Trustee information as to the names and addresses of the Holders, as of a date no more than fifteen (15) days prior to the date such information is so furnished, and the Trustee shall preserve such information and similar information received by it in any other capacity and afford to the Holders access to information so preserved by it, all to such extent, if any, and in such manner as shall be required by the Trust Indenture Act; provided, however, that no such list need be furnished so long as the Trustee shall be the Security Registrar.

SECTION 902.    Reports by Trustee and Company.

Not later than June 30 in each year, commencing June 30, 2005, the Trustee shall transmit to the Holders, the Commission and each securities exchange upon which any Securities are listed, a report, dated as of the next preceding September 15, with respect to any events and other matters described in Section 313(a) of the Trust Indenture Act, in such manner and to the extent required by the Trust Indenture Act.  The Trustee shall transmit to the Holders, the Commission and each securities exchange upon which any Securities are listed, and the Company shall file with the Trustee (within thirty (30) days after filing with the Commission in the case of reports which pursuant to the Trust Indenture Act must be filed with the Commission and furnished to the Trustee) and transmit to the Holders, such other information, reports and other documents, if any, at such times and in such manner, as shall be required by the Trust Indenture Act.  The Company shall notify the Trustee of the listing of any Securities on any securities exchange.

ARTICLE TEN

Consolidation, Merger, Conveyance or Other Transfer

SECTION 1001.    Company may Consolidate, etc., Only on Certain Terms.

The Company shall not consolidate with or merge into any other Person, or convey or otherwise transfer, or lease, the properties of the Company and its Restricted

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Subsidiaries, taken as a whole, as or substantially as an entirety, to any Person, in one or more related transactions, unless:

(a)the Person formed by such consolidation or into which the Company is merged or the Person which acquires by conveyance or other transfer, or which leases, the properties of the Company and its Restricted Subsidiaries, taken as a whole, as or substantially as an entirety, shall be (i) a corporation organized or existing under the laws of the United States, any State or Territory thereof or the District of Columbia or (ii) a partnership or limited liability company organized or existing under the laws of the United States, any State or Territory thereof or the District of Columbia, in either case, that has at least one Restricted Subsidiary that is a corporation organized or existing under the laws of the United States, any State or Territory thereof or the District of Columbia, which corporation becomes a co-issuer of the Securities pursuant to a supplemental indenture in form reasonably satisfactory to the trustee (such corporation and/or partnership, or limited liability company being hereinafter sometimes called the “Successor”); and in the case of either (i) or (ii), above, such Successor shall expressly assume, by an indenture supplemental hereto, executed and delivered to the Trustee, in form reasonably satisfactory to the Trustee, the due and punctual payment of the principal of and premium, if any, and interest, if any, on all the Securities then Outstanding and the performance and observance of every covenant and condition of this Indenture to be performed or observed by the Company;

(b)immediately before and after giving effect to such transaction or, series of related transactions, no Default or Event of Default shall have occurred and be continuing; and

(c)the Company shall have delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel, each of which shall state that such consolidation, merger, conveyance or other transfer or lease, and such supplemental indenture, comply with this Article and that all conditions precedent herein provided for relating to such transaction have been complied with.

SECTION 1002.    Successor Substituted.

Upon any consolidation or merger or any conveyance or other transfer of all the properties of the Company and its Restricted Subsidiaries, taken as a whole, as or substantially as an entirety, in accordance with Section 1001, the Successor shall succeed to, and be substituted for, and may exercise every power and right of, the Company under this Indenture with the same effect as if such Successor had been named as the “Company” herein and, in the event of any such conveyance or transfer, the Company (which term shall for this purpose means the Person named as the “Company” in the first paragraph of this Indenture or any successor Person which shall theretofore become such in the manner described in Section 1001), except in the case of a lease, shall be discharged of all obligations and covenants under this Indenture and the Securities and may be dissolved and liquidated.  Without limiting the generality of the foregoing, the Successor may execute and deliver to the Trustee, and thereupon the Trustee shall, subject to the provisions of Article Three, authenticate and deliver, Securities.  All Securities so executed by the Successor, and authenticated and delivered by the Trustee, shall in all respects be entitled to the benefits provided by this Indenture equally and ratably with all Securities executed,

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authenticated and delivered prior to the time such consolidation, merger, conveyance or other transfer became effective.

SECTION 1003.    Merger into Company.

Nothing in this Indenture shall be deemed to prevent or restrict (a) any consolidation or merger after the consummation of which the Company would be the surviving or resulting entity, or (b) any conveyance or other transfer, or lease of any part of the properties of the Company which does not constitute the entirety, or substantially the entirety, thereof, or (c) any conveyance or other transfer or lease of properties of any Restricted Subsidiaries to the Company.

ARTICLE ELEVEN

Supplemental Indentures

SECTION 1101.    Supplemental Indentures without Consent of Holders.

Without the consent of any Holders, the Company and the Trustee, at any time and from time to time, may enter into one or more indentures supplemental hereto, in form satisfactory to the Trustee, for any of the following purposes:

(a)to evidence the succession of another Person to the Company and the assumption by any such successor of the covenants of the Company herein and in the Securities, all as provided in Article Ten, including in the case of a merger or consolidation or sale of all or substantially all of the Company’s assets; or

(b)to add one or more covenants of the Company or other provisions for the benefit of all Holders or for the benefit of the Holders of, or to remain in effect only so long as there shall be Outstanding, Securities of one or more specified series, or one or more specified Tranches thereof, or to surrender any right or power herein conferred upon the Company; or

(c)to add any additional Event of Default with respect to all or any series of Outstanding Securities hereunder; or

(d)to change or eliminate any provision of this Indenture or to add any new provision to this Indenture; provided, however, that if such change, elimination or addition shall adversely affect the interests of the Holders of Securities of any series or Tranche in any material respect, such change, elimination or addition shall become effective with respect to such series or Tranche only pursuant to the provisions of Section 1102 hereof or when no Security of such series or Tranche remains Outstanding; or

(e)to provide guarantees or additional collateral security for all but not part of the Securities; or

(f)to establish the form or terms of Securities of any series or Tranche as contemplated by Sections 201 and 301; or

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(g)to provide for the authentication and delivery of bearer securities and coupons appertaining thereto representing interest, if any, thereon and for the procedures for the registration, exchange and replacement thereof and for the giving of notice to, and the solicitation of the vote or consent of, the holders thereof, and for any and all other matters incidental thereto; or

(h)to evidence and provide for the acceptance of appointment hereunder by a successor Trustee or by a co-trustee or separate trustee with respect to the Securities of one or more series and to add or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder by more than one Trustee, pursuant to the requirements of the Indenture; or

(i)to provide for the procedures required to permit the Company to utilize, at its option, a non-certificated system of registration for all, or any series or Tranche of, the Securities; or

(j)to change any place or places where (1) the principal of and premium, if any, and interest, if any, on all or any series of Securities, or any Tranche thereof, shall be payable, (2) all or any series of Securities, or any Tranche thereof, may be surrendered for registration of transfer, (3) all or any series of Securities, or any Tranche thereof, may be surrendered for exchange and (4) notices and demands to or upon the Company in respect of all or any series of Securities, or any Tranche thereof, and this Indenture may be served; or

(k)to cure any ambiguity, to correct or supplement any provision herein which may be defective or inconsistent with any other provision herein; or to make any other changes to the provisions hereof or to add other provisions with respect to matters or questions arising under this Indenture, provided that such other changes or additions shall not adversely affect the interests of the Holders of Securities of any series or Tranche in any material respect; or

(l)to modify, eliminate or add to the provisions of this Indenture to such extent as shall be necessary to effect the qualification of this Indenture under the Trust Indenture Act and to add to the Indenture such other provisions as may be expressly required under the Trust Indenture Act.

SECTION 1102.    Supplemental Indentures with Consent of Holders.

Subject to the provisions of Section 1101, with the consent of the Holders of a majority in aggregate principal amount of the Securities of all series then Outstanding under this Indenture, considered as one class, by Act of said Holders delivered to the Company and the Trustee, the Company and the Trustee may enter into an indenture or indentures supplemental hereto for the purpose of adding any provisions to, or changing or amending in any manner or eliminating any of the provisions of, this Indenture; provided, however, that if there shall be Securities of more than one series Outstanding hereunder and if a proposed supplemental indenture shall directly affect the rights of the Holders of Securities of one or more, but less than all, of such series, then the consent only of the Holders of a majority in aggregate principal amount of the Outstanding Securities of all series so directly affected, considered as one class,

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shall be required; and provided, further, that if the Securities of any series shall have been issued in more than one Tranche and if the proposed supplemental indenture shall directly affect the rights of the Holders of Securities of one or more, but less than all, of such Tranches, then the consent only of the Holders of a majority in aggregate principal amount of the Outstanding Securities of all Tranches so directly affected, considered as one class, shall be required; and provided, further, that no such supplemental indenture shall:

(a)change the Stated Maturity of the principal of, or any installment of principal of or interest on, any Security other than pursuant to the terms thereof, or reduce the principal amount thereof or the rate of interest thereon (or the amount of any installment of interest thereon) or change the method of calculating such rate or reduce any premium payable thereon, or reduce the amount of the principal of any Discount Security that would be due and payable upon a declaration of acceleration of the Maturity thereof pursuant to Section 702, or change the coin or currency (or other property), in which any Security or premium, if any, or interest, if any, thereon is payable, or impair the right to institute suit for the enforcement of any such payment on or after the Maturity of any Security, without, in any such case, the consent of the Holder of such Security; or

(b)permit the creation of any Lien ranking prior to the Lien of this Indenture with respect to any First Mortgage Bond delivered to and held by the Trustee pursuant to Article Three, or (except in accordance with the provisions of this Indenture) terminate the Lien of this Indenture on any such First Mortgage Bond or amend or waive the provisions of Section 315 or 316 as applicable to any First Mortgage Bond, without, in any such case, the consent of the Holders of all Securities of the related series then Outstanding; or

(c)reduce the percentage in principal amount of the Outstanding Securities of any series, or any Tranche thereof, the consent of the Holders of which is required for any such supplemental indenture, or the consent of the Holders of which is required for any waiver of compliance with any provision of this Indenture or of any default hereunder and its consequences, or reduce the requirements of Section 1204 for quorum or voting, without, in any such case, the consent of the Holder of each Outstanding Security of such series or Tranche; or

(d)modify any of the provisions of this Section, Section 317, Section 508 or Section 713 with respect to the Securities of any series or any Tranche thereof (except to increase the percentages in principal amount referred to in this Section or such other Sections or to provide that other provisions of this Indenture cannot be modified or waived without the consent of the Holders of all Securities of such series or Tranche) without, in any such case, the consent of the Holder of each Outstanding Security of such series or Tranche; provided, however, that this clause shall not be deemed to require the consent of any Holder with respect to changes in the references to “the Trustee” and concomitant changes in this Section, or the deletion of this proviso, in accordance with the requirements of Sections 811(b) and 1101(g).

A supplemental indenture which (x) changes or eliminates any covenant or other provision of this Indenture which has expressly been included solely for the benefit of the Holders of, or which is to remain in effect only so long as there shall be Outstanding, Securities

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of one or more specified series, or one or more Tranches thereof, or (y) modifies the rights of the Holders of Securities of such series or Tranches with respect to such covenant or other provision, shall be deemed not to affect the rights under this Indenture of the Holders of Securities of any other series or Tranche.

If the supplemental indenture, Board Resolution or Officer’s Certificate establishing any series of Securities, or Tranche thereof, so provides, the Holders of such Securities shall be deemed to have consented, by virtue of their acceptance of such Securities, to a supplemental indenture containing the additions, changes or eliminations to or from the Indenture which are specified in such supplemental indenture, Board Resolution or Officer’s Certificate.  No Act of such Holders will be required to evidence such consent and such consent may be counted in the determination of whether the Holders of the requisite principal amount of Outstanding Securities have consented to such supplemental indenture.

It shall not be necessary for any Act of Holders under this Section to approve the particular form of any proposed supplemental indenture, but it shall be sufficient if such Act shall approve the substance thereof.

SECTION 1103.    Execution of Supplemental Indentures.

In executing, or accepting the additional trusts created by, any supplemental indenture permitted by this Article or the modifications thereby of the trusts created by this Indenture, the Trustee shall be entitled to receive, and (subject to Section 801) shall be fully protected in relying upon, an Opinion of Counsel stating that the execution of such supplemental indenture is authorized or permitted by this Indenture.  The Trustee may, but shall not be obligated to, enter into any such supplemental indenture which affects the Trustee’s own rights, duties, immunities or liabilities under this Indenture or otherwise.

SECTION 1104.    Effect of Supplemental Indentures.

Upon the execution and delivery of any supplemental indenture under this Article this Indenture shall be modified in accordance therewith, and such supplemental indenture shall form a part of this Indenture for all purposes; and every Holder of Securities theretofore or thereafter authenticated and delivered hereunder shall be bound thereby.  Any supplemental indenture permitted by this Article may restate this Indenture in its entirety, and, upon the execution and delivery thereof, any such restatement shall supersede this Indenture as theretofore in effect for all purposes.

SECTION 1105.    Conformity with Trust Indenture Act.

Every supplemental indenture executed pursuant to this Article shall conform to the requirements of the Trust Indenture Act.

SECTION 1106.    Reference in Securities to Supplemental Indentures.

Securities of any series, or any Tranche thereof, authenticated and delivered after the execution of any supplemental indenture pursuant to this Article may, and shall if required by the Trustee, bear a notation in form approved by the Trustee as to any matter provided for in

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such supplemental indenture.  If the Company shall so determine, new Securities of any series, or any Tranche thereof, so modified as to conform, in the opinion of the Trustee and the Company, to any such supplemental indenture may be prepared and executed by the Company and authenticated and delivered by the Trustee in exchange for Outstanding Securities of such series or Tranche.

SECTION 1107.    Modification without Supplemental Indenture.

To the extent, if any, that the terms of any particular series of Securities shall have been established in an Officer’s Certificate or a Board Resolution as contemplated by Section 301, and not in a supplemental indenture, additions to, changes in or the elimination of any of such terms may be effected by means of a supplemental Officer’s Certificate or a supplemental Board Resolution, as the case may be, delivered to, and accepted by, the Trustee; provided, however, that such supplemental Officer’s Certificate or supplemental Board Resolution shall not be accepted by the Trustee or otherwise be effective unless all conditions set forth in this Indenture which would be required to be satisfied if such additions, changes or elimination were contained in a supplemental indenture shall have been appropriately satisfied.  Upon the acceptance thereof by the Trustee, any such supplemental Officer’s Certificate or supplemental Board Resolution shall be deemed to be a “supplemental indenture” for purposes of Section 1104 and 1106.

ARTICLE TWELVE

Meetings of Holders; Action without Meeting

SECTION 1201.    Purposes for Which Meetings May Be Called.

A meeting of Holders of Securities of one or more, or all, series, or any Tranche or Tranches thereof, may be called at any time and from time to time pursuant to this Article to make, give or take any request, demand, authorization, direction, notice, consent, waiver or other action provided by this Indenture to be made, given or taken by Holders of Securities of such series or Tranches.

SECTION 1202.    Call, Notice and Place of Meetings.

(a)The Trustee may at any time call a meeting of Holders of Securities of one or more, or all, series, or any Tranche or Tranches thereof, for any purpose specified in Section 1201, to be held at such time and (except as provided in subsection (b) of this Section) at such place in the Borough of Manhattan, The City of New York, as the Trustee shall determine, or, with the approval of the Company, at any other place.  Notice of every such meeting, setting forth the time and the place of such meeting and in general terms the action proposed to be taken at such meeting, shall be given, in the manner provided in Section 106, not less than twenty-one (21) nor more than one hundred eighty (180) days prior to the date fixed for the meeting.

(b)The Trustee may be asked to call a meeting of the Holders of Securities of one or more, or all, series, or any Tranche or Tranches thereof, by the Company or by the Holders of thirty-three percentum (33%) in aggregate principal amount of all of such series

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and Tranches, considered as one class, for any purpose specified in Section 1201, by written request setting forth in reasonable detail the action proposed to be taken at the meeting.  If the Trustee shall have been asked by the Company to call such a meeting, the Company shall determine the time and place for such meeting and may call such meeting by giving notice thereof in the manner provided in subsection (a) of this Section, or shall direct the Trustee, in the name and at the expense of the Company, to give such notice.  If the Trustee shall have been asked to call such a meeting by Holders in accordance with this subsection (b), and the Trustee shall not have given the notice of such meeting within twenty-one (21) days after receipt of such request or shall not thereafter proceed to cause the meeting to be held as provided herein, then the Holders of Securities of such series and Tranches, in the principal amount above specified, may determine the time and the place in the Borough of Manhattan, The City of New York, or in such other place as shall be determined or approved by the Company, for such meeting and may call such meeting for such purposes by giving notice thereof as provided in subsection (a) of this Section.

(c)Any meeting of Holders of Securities of one or more, or all, series, or any Tranche or Tranches thereof, shall be valid without notice if the Holders of all Outstanding Securities of such series or Tranches are present in person or by proxy and if representatives of the Company and the Trustee are present, or if notice is waived in writing before or after the meeting by the Holders of all Outstanding Securities of such series, or any Tranche or Tranches thereof, or by such of them as are not present at the meeting in person or by proxy, and by the Company and the Trustee.

SECTION 1203.    Persons Entitled to Vote at Meetings.

To be entitled to vote at any meeting of Holders of Securities of one or more, or all, series, or any Tranche or Tranches thereof, a Person shall be (a) a Holder of one or more Outstanding Securities of such series or Tranches, or (b) a Person appointed by an instrument in writing as proxy for a Holder or Holders of one or more Outstanding Securities of such series or Tranches by such Holder or Holders.  The only Persons who shall be entitled to attend any meeting of Holders of Securities of any series or Tranche shall be the Persons entitled to vote at such meeting and their counsel, any representatives of the Trustee and its counsel and any representatives of the Company and its counsel.

SECTION 1204.    Quorum; Action.

The Persons entitled to vote a majority in aggregate principal amount of the Outstanding Securities of the series and Tranches with respect to which a meeting shall have been called as hereinbefore provided, considered as one class, shall constitute a quorum for a meeting of Holders of Securities of such series and Tranches; provided, however, that if any action is to be taken at such meeting which this Indenture expressly provides may be taken by the Holders of a specified percentage, which is less than a majority, in principal amount of the Outstanding Securities of such series and Tranches, considered as one class, the Persons entitled to vote such specified percentage in principal amount of the Outstanding Securities of such series and Tranches, considered as one class, shall constitute a quorum.  In the absence of a quorum within one hour of the time appointed for any such meeting, the meeting shall, if convened at the request of Holders of Securities of such series and Tranches, be dissolved.  In any other case the

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meeting may be adjourned for such period as may be determined by the chairman of the meeting prior to the adjournment of such meeting.  In the absence of a quorum at any such adjourned meeting, such adjourned meeting may be further adjourned for such period as may be determined by the chairman of the meeting prior to the adjournment of such adjourned meeting.  Except as provided by Section 1205(e), notice of the reconvening of any meeting adjourned for more than thirty (30) days shall be given as provided in Section 106 not less than ten (10) days prior to the date on which the meeting is scheduled to be reconvened.  Notice of the reconvening of an adjourned meeting shall state expressly the percentage, as provided above, of the principal amount of the Outstanding Securities of such series and Tranches which shall constitute a quorum.

Except as limited by Section 1102, any resolution presented to a meeting or adjourned meeting duly reconvened at which a quorum is present as aforesaid may be adopted only by the affirmative vote of the Holders of a majority in aggregate principal amount of the Outstanding Securities of the series and Tranches with respect to which such meeting shall have been called, considered as one class; provided, however, that, except as so limited, any resolution with respect to any action which this Indenture expressly provides may be taken by the Holders of a specified percentage, which is less than a majority, in principal amount of the Outstanding Securities of such series and Tranches, considered as one class, may be adopted at a meeting or an adjourned meeting duly reconvened and at which a quorum is present as aforesaid by the affirmative vote of the Holders of such specified percentage in principal amount of the Outstanding Securities of such series and Tranches, considered as one class.

Any resolution passed or decision taken at any meeting of Holders of Securities duly held in accordance with this Section shall be binding on all the Holders of Securities of the series and Tranches with respect to which such meeting shall have been held, whether or not present or represented at the meeting.

SECTION 1205.    Attendance at Meetings; Determination of Voting Rights; Conduct and Adjournment of Meetings.

(a)Attendance at meetings of Holders of Securities may be in person or by proxy; and, to the extent permitted by law, any such proxy shall remain in effect and be binding upon any future Holder of the Securities with respect to which it was given unless and until specifically revoked by the Holder or future Holder (except as provided in Section 104(g)) of such Securities before being voted.

(b)Notwithstanding any other provisions of this Indenture, the Trustee may make such reasonable regulations as it may deem advisable for any meeting of Holders of Securities in regard to proof of the holding of such Securities and of the appointment of proxies and in regard to the appointment and duties of inspectors of votes, the submission and examination of proxies, certificates and other evidence of the right to vote, and such other matters concerning the conduct of the meeting as it shall deem appropriate.  Except as otherwise permitted or required by any such regulations and approved by the Company, the holding of Securities shall be proved in the manner specified in Section 104 and the appointment of any proxy shall be proved in the manner specified in Section 104.  Such regulations may provide that written instruments appointing proxies, regular on their face,

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may be presumed valid and genuine without the proof specified in Section 104 or other proof.

(c)The Trustee shall, by an instrument in writing, appoint a temporary chairman of the meeting, unless the meeting shall have been called by the Company or by Holders as provided in Section 1202(b), in which case the Company or the Holders of Securities of the series and Tranches calling the meeting, as the case may be, shall in like manner appoint a temporary chairman.  A permanent chairman and a permanent secretary of the meeting shall be elected by vote of the Persons entitled to vote a majority in aggregate principal amount of the Outstanding Securities of all series and Tranches represented at the meeting, considered as one class.

(d)At any meeting each Holder or proxy shall be entitled to one vote for each One Thousand Dollars ($1,000) principal amount of Outstanding Securities held or represented by such Holder; provided, however, that no vote shall be cast or counted at any meeting in respect of any Security challenged as not Outstanding and ruled by the chairman of the meeting to be not Outstanding.  The chairman of the meeting shall have no right to vote, except as a Holder of a Security or proxy.

(e)Any meeting duly called pursuant to Section 1202 at which a quorum is present may be adjourned from time to time by Persons entitled to vote a majority in aggregate principal amount of the Outstanding Securities of all series and Tranches represented at the meeting, considered as one class; and the meeting may be held as so adjourned without further notice.

SECTION 1206.    Counting Votes and Recording Action of Meetings.

The vote upon any resolution submitted to any meeting of Holders shall be by written ballots on which shall be subscribed the signatures of the Holders or of their representatives by proxy and the principal amounts and serial numbers of the Outstanding Securities, of the series and Tranches with respect to which the meeting shall have been called, held or represented by them.  The permanent chairman of the meeting shall appoint two inspectors of votes who shall count all votes cast at the meeting for or against any resolution and who shall make and file with the secretary of the meeting their verified written reports of all votes cast at the meeting.  A record in duplicate of the proceedings of each meeting of Holders shall be prepared by the secretary of the meeting and there shall be attached to such record the original reports of the inspectors of votes on any vote by ballot taken thereat and affidavits by one or more persons having knowledge of the facts setting forth a copy of the notice of the meeting and showing that such notice was given as provided in Section 1202 and, if applicable, Section 1204.  Each copy shall be signed and verified by the affidavits of the permanent chairman and secretary of the meeting and one such copy shall be delivered to the Company, and another to the Trustee to be preserved by the Trustee, the latter to have attached thereto the ballots voted at the meeting.  Any record so signed and verified shall be conclusive evidence of the matters therein stated.

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SECTION 1207.    Action without Meeting.

In lieu of a vote of Holders at a meeting as hereinbefore contemplated in this Article, any request, demand, authorization, direction, notice, consent, waiver or other action may be made, given or taken by Holders by written instruments as provided in Section 104.

ARTICLE THIRTEEN

Immunity of Incorporators, Stockholders, Officers and Directors

SECTION 1301.    Liability Solely Corporate.

No recourse shall be had for the payment of the principal of or premium, if any, or interest, if any, on any Securities, or any part thereof, or for any claim based thereon or otherwise in respect thereof, or of the indebtedness represented thereby, or upon any obligation, covenant or agreement under this Indenture, against any incorporator, stockholder, officer, director or employee, as such, past, present or future, of the Company or of any predecessor or successor corporation (either directly or through the Company or a predecessor or successor corporation), whether by virtue of any constitutional provision, statute or rule of law or by the enforcement of any assessment or penalty or otherwise; it being expressly agreed and understood that this Indenture and all the Securities are solely corporate obligations and that no personal liability whatsoever shall attach to, or be incurred by, any incorporator, stockholder, officer, director or employee, past, present or future, of the Company or of any predecessor or successor corporation, either directly or indirectly through the Company or any predecessor or successor corporation, because of the indebtedness hereby authorized or under or by reason of any of the obligations, covenants or agreements contained in this Indenture or in any of the Securities or to be implied herefrom or therefrom; and such personal liability, if any, is hereby expressly waived and released as a condition of, and as part of the consideration for, the execution and delivery of this Indenture and the issuance of the Securities.

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IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly executed as of the day and year first above written.

NORTHWESTERN CORPORATION
By:	/s/ Brian B. Bird
Name: Brian B. Bird
Title: Vice President and Chief Financial Officer
U.S. BANK NATIONAL ASSOCIATION, Trustee
By:	/s/ Lori-Anne Rosenberg
Name: Lori-Anne Rosenberg
Title: Assistant Vice President

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EX-4.2

Exhibit 4.2

NORTHWESTERN CORPORATION

TO

U.S. Bank National Association,
Trustee

Supplemental Indenture No. 1
dated as of November 1, 2004

Supplemental to the Indenture
dated as of November 1, 2004

Establishing a series of Securities designated
Senior Secured Notes, 5.875% Series A due 2014
limited in aggregate principal amount to $225,000,000
and
a series of Securities designated
Senior Secured Notes, 5.875% Exchange Series A due 2014
limited in aggregate principal amount to $225,000,000

SUPPLEMENTAL INDENTURE NO. 1

SUPPLEMENTAL INDENTURE NO. 1,dated as of the 1^st day of November, 2004, made and entered into by and between NORTHWESTERN CORPORATION, a corporation organized and existing under the laws of the State of Delaware, whose address is 125 S. Dakota Avenue, Sioux Falls, South Dakota  57104 (hereinafter sometimes called the “Company”), and U.S. BANK NATIONAL ASSOCIATION, a national banking organization, whose address is 60 Livingston Avenue, St. Paul, MN  55107 (hereinafter sometimes called the “Trustee”), as Trustee under the Indenture, dated as of November 1, 2004 (hereinafter called the “Original Indenture”), this Supplemental Indenture No. 1 being supplemental thereto.  The Original Indenture and any and all indentures and instruments supplemental thereto are hereinafter sometimes collectively called the “Indenture.”

Recitals of the Company

The Original Indenture was authorized, executed and delivered by the Company to provide for the issuance from time to time of its Securities (such term and all other capitalized terms used herein without definition having the meanings assigned to them in the Original Indenture), to be issued in one or more series as contemplated therein, and to provide security for the payment of the principal of and premium, if any, and interest, if any, on the Securities.

As contemplated in Sections 301 and 1101(f) of the Original Indenture, the Company wishes to establish a series of Securities to be designated “Senior Secured Notes, 5.875% Series A due 2014 and to be limited in aggregate principal amount (except as contemplated in Section 301(b) of the Original Indenture) to $225,000,000, such series of Securities to be hereinafter sometimes called “Series No. 1.”

The Company has agreed to offer and sell the securities of Series No. 1 to certain initial purchasers in a private placement pursuant to Section 4(2) of the Securities Act, and the Company and such initial purchasers of the Securities of Series No. 1 are entering into a Registration Rights Agreement dated as of November 1, 2004 (the “Registration Rights Agreement”) which requires, upon the terms and conditions provided therein, the Company to use its commercially reasonable efforts to make a Registered Exchange Offer (as defined in the Registration Rights Agreement) which would enable Holders of Securities of Series No. 1 to exchange such Securities or cause a Shelf Registration Statement (as defined in the Registration Rights Agreement) to become effective with respect to the Securities of Series No. 1;

In connection with a Registered Exchange Offer and as contemplated by Sections 301 and 1101(f) of the Original Indenture, the Company wishes to establish a series of Securities to be designated “Senior Secured Notes, 5.875% Exchange Series A due 2014” to be limited in aggregate principal amount (except as contemplated in Section 301(b) of the Original Indenture) to $225,000,000, such series of Securities to be hereinafter sometimes called “Series No. 2.”

The Company has duly authorized the execution and delivery of this Supplemental Indenture No. 1 to establish the Securities of Series No. 1 and Series No. 2 and has duly authorized the issuance of such Securities; and all acts necessary to make this Supplemental Indenture No. 1 a valid agreement of the Company and to make the Securities of Series No. 1 and Series No. 2 valid obligations of the Company have been performed.

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NOW, THEREFORE, THIS SUPPLEMENTAL INDENTURE NO. 1 WITNESSETH, that, for and in consideration of the premises and of the purchase of the Securities by the Holders thereof, it is mutually covenanted and agreed, for the equal and proportionate benefit of the Holders of the Securities of Series No. 1 and Series No. 2 as follows:

ARTICLE ONE

First Series of Securities

SECTION 1.There is hereby created under the Indenture a series of Securities designated “Senior Secured Notes, 5.875% Series A due 2014” and limited in aggregate principal amount (except as contemplated in Section 301(b) of the Original Indenture) to $225,000,000.  The forms and terms of the Securities of Series No. 1, including terms relating to restrictions on transfer, and forms of appropriate transfer certificates (“Transfer Certificates”) in connection therewith shall be as provided in Article 4, Section 9 of this Supplemental Indenture.  The Trustee shall authenticate and issue new Securities of Series No. 1 upon a registration of transfer only upon receipt of an appropriate Transfer Certificate in the form as provided in Exhibit B.  The Trustee shall refuse to register any transfer of Securities of Series No. 1 without appropriate completion of the appropriate Transfer Certificate on such Security.  The Securities of Series No. 1 and the Security of Series No. 2 shall be considered as a single series and class for purposes of any Acts of Holders under the Indenture and for purposes of Section 312(e) of the Original Indenture.

SECTION 2.As provided in and pursuant to Article Three of the Original Indenture, the Securities of Series No. 1 and, upon any exchange contemplated in Article Two, the Securities of Series No. 2, will be secured as to payments of principal, interest and premium, if any, by series of First Mortgage Bonds in aggregate principal amount equal to the aggregate principal amount of the Securities of Series No. 1, consisting of:  (a) a series of First Mortgage Bonds issued under and secured by the Montana Mortgage (the “Montana First Mortgage Bonds”), in the original aggregate principal amount of $161,000,000 and designated First Mortgage Bonds, Collateral (2004) Series C, due 2014 and (b) a series of First Mortgage Bonds issued under and secured by the South Dakota Mortgage, in the original aggregate principal amount of $64,000,000 and designated First Mortgage Bonds, Collateral (2004) Series C, due 2014 (the “South Dakota First Mortgage Bonds”).  The Montana First Mortgage Bonds and the South Dakota First Mortgage Bonds (collectively, the “First Mortgage Bonds,” or the “related First Mortgage Bonds”) of the Company are to be issued concurrently with the issuance of the Securities, and delivered and pledged by the Company to the Trustee for the benefit of the Holders of the Securities of Series No. 1 and, upon any exchange contemplated in Article Two below, Series No. 2, to the Trustee under this Supplemental Indenture.

ARTICLE TWO

Exchange Securities

SECTION 1.There is hereby created under the Indenture a series of Securities designated “Senior Secured Notes, 5.875% Exchange Series A due 2014” and limited in aggregate principal amount (except as contemplated in Section 301(b) of the Original Indenture) to $225,000,000.  The forms and terms of the Securities of the Series No. 2 shall be as provided in Article 4, Section 9 of this Supplemental Indenture.  The Securities of Series No. 2 are to be offered to the holders of the Securities of Series No. 1 in exchange for Securities of Series No. 1.  To the extent that such offer is accepted and Securities of Series No. 1 shall be surrendered for

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such exchange, Securities of Series No. 2 shall be authenticated and delivered by the Trustee and shall be issued and delivered to such holders in exchange for Securities of Series No. 1 of like principal amount so surrendered.  The Securities of Series No. 1 and Series No. 2 shall be considered as a single series and class for purposes of any Holders under the Indenture and for purposes of Section 312(e) of the Original Indenture.

As contemplated in Article One, the Securities of Series No. 1 are to be authenticated and delivered upon the basis of an equal aggregate principal amount of the Company’s First Mortgage Bonds so described in Article One, authenticated and delivered under the Company’s Mortgages.  As contemplated by Section 315 of the Original Indenture, the Trustee is to retain such First Mortgage Bonds and, accordingly, no additional First Mortgage Bonds are required to be delivered to the Trustee under Section 312 of the Original Indenture in connection with the authentication and delivery of the Securities of Series No. 2.

The sum (the “Sum”) of (a) the aggregate principal amount of Securities of Series No. 1 Outstanding at any time and (b) the aggregate principal amount of Securities of Series No. 2 Outstanding at such time shall be limited to $225,000,000, except as contemplated in clause (b) of the second paragraph of Section 301 of the Original Indenture.  Notwithstanding anything contained in the Original Indenture or this Supplemental Indenture, the Company shall not issue any Securities of Series No. 2 if the Sum of the aggregate principal amount of Securities of Series No. 1 and Series No. 2 would exceed the aggregate principal amount of related First Mortgage Bonds securing such series as described herein.

SECTION 2.Private Exchange Securities.  Pursuant to the Registration Rights Agreement, if any Initial Purchaser (as such term is defined in the Registration Rights Agreement) holds, upon consummation of the Registered Exchange Offer (as defined in the Registration Rights Agreement), Securities of Series No. 1 acquired by it as part of its initial distribution, the Company shall issue to such Initial Purchaser Securities of Series No. 2 in a private exchange (the “Private Exchange Securities”) simultaneously with the delivery of all other Securities of Series No. 2 pursuant to such Registered Exchange Offer.  Such Private Exchange Securities shall be identical in all material respects to all other Securities of Series No. 2, except such Private Exchange Securities shall include restrictions on transfer under the Securities Act and the securities laws of the several states of the United States, as set forth in the Registration Rights Agreement.

ARTICLE THREE

Trustee to Hold First Mortgage Bonds; Applicable Basis; Additional Trustee Responsibilities

SECTION 1.Trustee to Hold First Mortgage Bonds.  So long as any Securities of Series No. 1 or Series No. 2 remain Outstanding, the Trustee shall hold in the State of New York all First Mortgage Bonds delivered to and to be held by it pursuant to Article Three of the Original Indenture; provided that the Trustee may hold such First Mortgage Bonds at its corporate trust office in Milwaukee, Wisconsin or in another jurisdiction if it receives an Opinion of Counsel to the effect that the perfection and priority of the security interest, if any, created by the penultimate sentence of Section 313 of the Original Indenture will continue in such other jurisdiction and notifies the Company of such change in jurisdiction.

SECTION 2.Applicable Basis.  As contemplated by Section 314(a) of the Original Indenture, the “Applicable Basis” with respect to the First Mortgage Bonds (and upon which (i)

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portions of principal of, premium (if any) and interest on the Securities of Series No. 1 and/or Series No. 2 that are payable under, and secured by, the Montana First Mortgage Bonds and the South Dakota First Mortgage Bonds, respectively, shall be determined, (ii) the portions of payments of principal of, premium (if any) and interest on the Securities of Series No. 1 and/or Series No. 2 shall be credited against corresponding payments of principal of, premium (if any) and interest on the Montana First Mortgage Bonds and the South Dakota First Mortgage Bonds, respectively, and (iii) the respective principal amounts of the Montana First Mortgage Bonds and the South Dakota First Mortgage Bonds to be deemed paid and satisfied and to be surrendered upon, and by reason of, all or a portion of the Securities of Series No. 1 and/or Series No. 2 ceasing to be Outstanding) shall be (a) calculated (I) in the case of the Montana First Mortgage Bonds, as the “Senior Notes Applicable Share” as defined in the Montana First Mortgage Bonds, and (II) in the case of the South Dakota First Mortgage Bonds, as the “Senior Notes Applicable Share” as defined in the South Dakota First Mortgage Bonds (in the respective cases, of the aggregate amount of the payment to be apportioned or credited or of the aggregate principal amount that ceases to be Outstanding) and, as a consequence, each apportionment, credit, deemed payment and satisfaction, surrender or other act or thing which, in accordance with the Original Indenture, is to be done on the Applicable Basis shall be done pro rata in the proportion that the principal amount of the First Mortgage Bonds then Outstanding under each Mortgage bears to the principal amount of the First Mortgage Bonds then Outstanding under both Mortgages.

SECTION 3.Certain Notices.  The Trustee shall give notices of changes in the “Senior Notes Applicable Share” as defined in the Montana Mortgage Bonds and the “Senior Notes Applicable Share” as defined in the South Dakota First Mortgage Bonds to the trustees under the related Mortgages at the times and in the manner provided in such First Mortgage Bonds (and, in calculating the same, shall ensure that, after giving effect to the rounding provided for in the First Mortgage Bonds, the sum of the Senior Notes Applicable Share as defined in the Montana First Mortgage Bonds and the Senior Notes Applicable Share as defined in the South Dakota First Mortgage Bonds is one-hundred percent (100%)).

SECTION 4.Additional Termination Provisions.  The Trustee shall not surrender First Mortgage Bonds or terminate the lien of the Indenture on the First Mortgage Bonds, except in accordance with Section 315 of the Original Indenture.

ARTICLE FOUR

Additional Provisions of the Securities

SECTION 1.Mandatory Redemption.  The Securities of Series No. 1 or Series No. 2 shall not be subject to any sinking fund or other mandatory redemption provision.

SECTION 2.Optional Redemption.

(A)Optional Redemption.  Except as provided in Section 2(B), below, the Securities of Series No. 1 and Series No. 2 will not be redeemable at the Company’s option prior to November 1, 2009.  On and after November 1, 2009, the Company may redeem all or a part of the Securities of Series No. 1 or Series No. 2 upon not less than 30 nor more than 60 days’ notice, at the Redemption Prices (expressed as percentages of principal amount) set forth below, plus accrued and unpaid interest if any, on the Securities of Series No. 1 or Series No. 2 redeemed, to the applicable Redemption Date, if redeemed during the twelve-month period beginning on November 1 of the years indicated below:

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Year	Percentage
2009	102.938	%
2010	101.958	%
2011	100.979	%
2012 and thereafter	100.000	%

(B)Equity Claw-Back.  At any time prior to November 1, 2007, the Company may, on any one or more occasions, redeem, in whole or in part, up to 35% of the aggregate principal amount of the Securities of Series No. 1 and/or Series No. 2 at a Redemption Price of 105.875% of the principal amount of the Securities of Series No. 1 or Series No. 2 redeemed, plus accrued and unpaid interest, if any, on such Securities redeemed to the Redemption Date, with the net cash proceeds of any public or private offering of the Company’s Equity Interests (other than Disqualified Stock) or as a capital contribution from one or more Equity Offerings; provided that:

(1)at least 65% of the aggregate principal amount of Securities of Series No. 1 and/or Series No. 2 issued under the Indenture remains outstanding immediately after the occurrence of each such redemption (excluding Securities of Series No. 1 held by the Company and its Subsidiaries); and

(2)The redemption shall occur within 60 days of the date of closing of such of Equity Offering.

(C)Notice of Redemption.  Notices of redemption in accordance with Section 404 of the Original Indenture shall be mailed by first class mail at least 30 but not more than 60 days before the Redemption Date to each Holder of Securities of Series No. 1 or Series No. 2 to be redeemed at its registered address, except that redemption notices may be mailed more than 60 days prior to a Redemption Date if the notice is issued in connection with a defeasance of such Securities or a satisfaction and discharge of such Securities under the Indenture.  Notwithstanding the penultimate paragraph of Section 404 of the Original Indenture, notices of redemption with respect to the Securities may not be conditional.

(D)Selection of Securities of Series No. 1 or Series No. 2 to be Redeemed.  No Securities of Series No. 1 or Series No. 2 of $1,000 principal amount or less can be redeemed in part.  In accordance with Section 403 of the Indenture, the following method is provided for the selection of Securities of Series No. 1 or Series No. 2 to be redeemed and these procedures shall be followed by the Security Registrar in the event of a redemption of less than all of such Securities pursuant to the provisions of this Supplemental Indenture.  If less than all of the Securities are to be redeemed at any time, the Security Registrar shall select such Securities for redemption as follows:

(1)If the Securities of Series No. 1 or Series No. 2 are listed on any national securities exchange, in compliance with the requirements of the principal national securities exchange on which such Securities are listed; or

(2)If the Securities of Series No. 1 or Series No. 2 are not listed on any national securities exchange, on a pro rata basis, by lot or by such method as the Trustee deems fair and appropriate.

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SECTION 3.Offer to Purchase Upon Change of Control.

(A)Upon the occurrence of a Change of Control, each Holder of Securities of Series No. 1 and Series No. 2 shall have the right to require the Company to repurchase all or any part (equal to $1,000 or an integral multiple of $1,000) of that Holder’s Securities of Series No. 1 or Series No. 2 pursuant to the offer described below (the “Change of Control Offer”) on the terms set forth in this Section 3. In the Change of Control Offer, the Company shall offer an amount in cash (the “Change of Control Payment”) equal to 101% of the aggregate principal amount of such Securities of Series No. 1 or Series No. 2 repurchased plus accrued and unpaid interest, if any, on such Securities repurchased, to the Change of Control Payment Date (as defined below).

(B)Within twenty (20) days following any Change of Control, the Company shall send, by first class mail a notice to each Holder of such Securities, with a copy to the Trustee, stating:

(1)the description of the transaction or transactions that constitute the Change of Control, that the Change of Control Offer is being made pursuant to this Section 3, and that all such Securities validly tendered and not withdrawn shall be accepted for payment;

(2)the purchase price and the purchase date, which shall be no earlier than 30 days and no later than 60 days from the date such notice is mailed (the “Change of Control Payment Date”);

(3)that any such Securities not tendered or accepted for payment shall continue to accrue interest, if any;

(4)that, unless the Company defaults in the payment of the Change of Control Payment, all such Securities accepted for payment pursuant to the Change of Control Offer shall cease to accrue interest, if any, after the Change of Control Payment Date;

(5)that Holders of such Securities electing to have any such Securities purchased pursuant to a Change of Control Offer shall be required to surrender such Securities properly endorsed, with the form entitled “Option of Holder to Elect Purchase” on the reverse of such Securities properly completed, together with other customary documents as the Company may reasonably request, to the Paying Agent at the address specified in the notice prior to the close of business on the third Business Day preceding the Change of Control Payment Date;

(6)that Holders of such Securities shall be entitled to withdraw their election if the Paying Agent receives, not later than the close of business on the second Business Day preceding the Change of Control Payment Date, a telegram, telex, facsimile transmission or letter setting forth the name of the Holder, the principal amount of such Securities delivered for purchase, and a statement that such Holder of such Securities is withdrawing its election to have such Securities purchased; and

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(7)that Holders of such Securities whose Securities are being purchased only in part shall be issued new Securities of Series No. 1 and Series No. 2 equal in principal amount to the unpurchased portion of such Securities surrendered, which unpurchased portion must be equal to $1,000 in principal amount or an integral multiple thereof.

(C)If any of such Securities subject to a Change of Control Offer are in the form of a Global Security, then the Company shall modify such notice to the extent necessary to accord with the Applicable Procedures of the Depositary applicable to offers to purchase.

(D)On the Change of Control Payment Date, the Company shall, to the extent lawful, (1) accept for payment all such Securities or portions thereof properly tendered pursuant to the Change of Control Offer, (2) deposit with the Paying Agent in immediately available funds an amount equal to the Change of Control Payment in respect of all such Securities or portions thereof so tendered and (3) deliver or cause to be delivered to the Trustee the Securities of Series No. 1 or Series No. 2 so accepted together with an Officer’s Certificate stating the aggregate principal amount of such Securities or portions thereof being purchased by the Company.  The Paying Agent shall promptly mail to each Holder of such Securities so tendered the Change of Control Payment for such Securities, and the Trustee shall promptly authenticate and mail (or cause to be transferred by book-entry) to each Holder of such Securities a new Security equal in principal amount to any unpurchased portion of such Securities surrendered, if any; provided that each such new Security shall be in a principal amount of $1,000 or an integral multiple thereof.  Any such Security not so accepted shall be promptly mailed or delivered by the Company to the Holder thereof.  The Company shall publicly announce the results of the Change of Control Offer on or as soon as practicable after the Change of Control Payment Date.

(E)The Change of Control provisions described above that require the Company to make a Change of Control Offer following a Change of Control shall be applicable whether or not any other provisions of this Supplemental Indenture are applicable.

(F)Notwithstanding anything to the contrary in this Section 3, the Company will not be required to make a Change of Control Offer upon a Change of Control if (1) a third party makes the Change of Control Offer in the manner, at the times and otherwise in compliance with the requirements set forth in this Section 3 and purchases all Securities of Series No. 1 and Series No. 2 properly tendered and not withdrawn under the Change of Control offer, or (2) notice of redemption has been given pursuant to Section 2 of this Article (“Optional Redemption”) unless and until there is a default in payment of the applicable redemption price.

(G)The provisions described in this Section 3 (“Offer to Purchase Upon Change of Control”) are subject to the provisions of Section 6(L) of this Article (“Covenants—Termination of  Selected Covenants”).

SECTION 4.Offer to Purchase by Application of Excess Proceeds.

(A)In the event that, pursuant to Section 6(E) of this Article (under the heading “Covenants—Asset Sales”), the Company shall be required to commence an

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Asset Sale Offer, it shall make an offer (an “Asset Sale Offer”) to all Holders of Securities of Series No. 1 and Series No. 2, and, if applicable, all holders of Indebtedness (other than Subordinated Indebtedness) containing provisions similar to those set forth in this Supplemental Indenture with respect to offers to purchase or redeem with the proceeds of sales of assets, to purchase the maximum principal amount of such Securities and such other Indebtedness that may be purchased out of the Excess Proceeds (as defined below). The offer price in any Asset Sale Offer shall be equal to 100% of the principal amount plus accrued and unpaid interest, if any, to the date of purchase, and shall be payable in cash. If any Excess Proceeds remain after consummation of an Asset Sale Offer, the Company may use those Excess Proceeds for any purpose not otherwise prohibited by the Indenture, including this Supplemental Indenture. If the aggregate principal amount of such Securities and other Indebtedness tendered into such Asset Sale Offer exceeds the amount of Excess Proceeds, the Trustee shall select such Securities and such other Indebtedness to be purchased (i) on a pro rata basis, or (ii) if the notes are listed on any national securities exchange, in compliance with the requirements of the principal national securities exchange on which the notes are listed. The Company shall advise the Trustee of such other Indebtedness and the Trustee shall have no duty or responsibility to determine the accuracy or correctness of such advice and shall be fully protected in relying on such advice.  Upon completion of each Asset Sale Offer, the amount of Excess Proceeds shall be reset at zero.

(B)Any Asset Sale Offer shall remain open for a period of 20 Business Days following its commencement and no longer, except to the extent that a longer period is required by applicable law (the “Offer Period”).  No later than five Business Days after the termination of the Offer Period (the “Purchase Date”), the Company shall purchase the principal amount of such Securities required to be purchased pursuant to paragraph  (A) above (the “Offer Amount”) or, if less than the Offer Amount has been tendered, all such Securities validly tendered in response to the Asset Sale Offer.

(C)Upon the commencement of an Asset Sale Offer, the Company shall send, by first class mail, a notice to each of the Holders of such Securities, with a copy to the Trustee, stating:

(1)that the Asset Sale Offer is being made pursuant to this Section 4 and Section 6(E) of this Article (under the heading “Covenants—Asset Sales”)  and the length of time the Asset Sale Offer shall remain open;

(2)the Offer Amount, the purchase price and the Purchase Date;

(3)that any such Security not tendered or accepted for payment shall continue to accrue interest, if any;

(4)that, unless the Company defaults in making such payment, any such Security accepted for payment pursuant to the Asset Sale Offer shall cease to accrue interest, if any, after the Purchase Date;

(5)that Holders of such Securities electing to have such Securities purchased pursuant to any Asset Sale Offer shall be required to surrender such Securities, with the form entitled “Option of Holder to Elect Purchase” on the reverse of such Securities properly completed, together with other customary documents as the Company may reasonably request, to the Paying Agent at the

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address specified in the notice prior to the close of business on the third Business Day preceding the Purchase Date;

(6)that Holders of such Securities shall be entitled to withdraw their election if the Paying Agent receives, not later than the close of business on the second Business Day preceding the Purchase Date, a telegram, telex, facsimile transmission or letter setting forth the name of the Holder, the principal amount of such Securities delivered for purchase, and a statement that such Holder of such Securities is withdrawing its election to have such Securities purchased;

(7)that, if the aggregate principal amount of such Securities surrendered by Holders of such Securities exceeds the Offer Amount, the Trustee shall select such Securities to be purchased on a pro rata basis (with such adjustments as may be deemed appropriate by the Trustee so that only such Securities in denominations of $1,000, or integral multiples thereof, shall be purchased); and

(8)that Holders of such Securities whose Securities are being purchased only in part shall be issued new such Securities equal in principal amount to the unpurchased portion of the Securities surrendered, which unpurchased portion must be equal to $1,000 in principal amount or an integral multiple thereof.

(D)If any of such Securities subject to an Asset Sale Offer is in the form of a Global Security, then the Company shall modify such notice to the extent necessary to accord with the Applicable Procedures of the Depositary applicable to offers to purchase.

(E)On or before the Purchase Date, the Company shall, to the extent lawful, accept for payment, on a pro rata basis to the extent necessary, the Offer Amount of such Securities or portions thereof tendered pursuant to the Asset Sale Offer, or if less than the Offer Amount has been tendered, all such Securities tendered, and shall deliver to the Trustee an officer’s certificate stating that such Securities or portions thereof were accepted for payment by the Company in accordance with the terms of this Section 4. The Paying Agent shall promptly (but in any case not later than five days after the Purchase Date) mail or deliver to each tendering Holder of such Securities an amount equal to the purchase price of such Securities tendered by such Holder of such Securities and accepted by the Company for purchase, and the Company shall promptly issue a new such Security, and the Trustee, upon written request from the Company, shall authenticate and make available for delivery such new Security to such Holder of such Securities, in a principal amount equal to any unpurchased portion of such Security surrendered; provided that each such new Security shall be in a principal amount of $1,000 or an integral multiple thereof.  Any such Security not so accepted shall be promptly mailed or delivered by the Company to the Holder thereof.  The Company shall publicly announce the results of the Asset Sale Offer on the Purchase Date or as soon as practicable thereafter.

(F)The provisions of this Section 4 (“Offer to Purchase by Application of Excess Proceeds”) are subject to the provisions of Section 6(L) of this Article (“Covenants—Termination of Selected Covenants”).

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SECTION 5.Offers to Purchase—General.

(A)If the Change of Control Payment Date or Purchase Date is on or after a Regular Record Date and on or before the related Interest Payment Date, any accrued and unpaid interest, if any, shall be paid to the Person in whose name such Security is registered at the close of business on such Regular Record Date, and no additional interest shall be payable to Holders of such Securities who tender such Securities pursuant to the Change of Control Offer or the Asset Sale Offer.

(B)The Company shall comply with the requirements of Rule 14e-1 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and any other securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with a Change of Control Offer or an Asset Sale Offer. To the extent that the provisions of any securities laws or regulations conflict with the Change of Control Offer or Asset Sale Offer provisions of this Supplemental Indenture, the Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached its obligations under the Change of Control Offer or Asset Sale Offer provisions of this Supplemental Indenture by virtue of such compliance.

SECTION 6.Covenants.  So long as any Securities of Series No. 1 or Series No. 2 shall remain Outstanding, each of the following shall be an additional covenant of the Company under the Indenture unless the holders of a majority in principal amount of the Securities of Series No. 1 and Series No. 2 then Outstanding hereby consent otherwise:

(A)Restricted Payments.

(1)The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly:

(a)declare or pay any dividend or make any other payment or distribution on account of the Company’s or any of its Restricted Subsidiaries’ Equity Interests (including, without limitation, any payment in connection with any merger or consolidation involving the Company or any of its Restricted Subsidiaries) or to the direct or indirect holders of the Company’s or any of its Restricted Subsidiaries’ Equity Interests in their capacity as such (other than dividends or distributions payable in Equity Interests (other than Disqualified Stock) of the Company) or dividends, payments or distributions payable to the Company or a Restricted Subsidiary of the Company;

(b)purchase, redeem or otherwise acquire or retire for value (including, without limitation, in connection with any merger or consolidation involving the Company) any Equity Interests of the Company (other than any such Equity Interests owned by the Company or any Restricted Subsidiary);

(c)make any payment on or with respect to, or purchase, redeem, defease or otherwise acquire or retire for value any Subordinated Indebtedness (other than intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries), except (i) a payment of interest or principal at the Stated Maturity thereof or (ii) a payment, purchase, redemption, defeasance, acquisition or retirement, in each case due within one year of the Stated Maturity thereof; or

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(d)make any Restricted Investment

(all such payments and other actions set forth in these clauses (a) through (d) above being collectively referred to as “Restricted Payments”), unless, at the time of and after giving effect to such Restricted Payment:

(x)no Default or Event of Default has occurred and is continuing or would occur as a consequence of such Restricted Payment; and

(y)the Company would, at the time of such Restricted Payment and after giving pro forma effect thereto as if such Restricted Payment had been made at the beginning of the applicable four-quarter period, have been permitted to incur at least $1.00 of additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test set forth in Section 6(B)(1) of this Supplemental Indenture (under the heading “Incurrence of Indebtedness and Issuance of Preferred Stock”); and

(z)such Restricted Payment, together with the aggregate amount of all other Restricted Payments made by the Company and its Restricted Subsidiaries after January 1, 2005 (excluding Restricted Payments permitted by clauses 6(A)(2)(b), 6(A)(2)(c), 6(A)(2)(d), 6(A)(2)(f), 6(A)(2)(g), 6(A)(2)(h), 6(A)(2)(i), 6(A)(2)(j), 6(A)(2)(k) and 6(A)(2)(l), is less than the sum, without duplication of:

(i)up to 50% of Excess Cash Flow generated since January 1, 2005 to the end of the Company’s most recently ended fiscal quarter for which internal financial statements are available, plus

(ii)100% of the aggregate net cash proceeds received by the Company from January 1, 2005 as a contribution to its common equity capital or from the issue or sale of Equity Interests of the Company (other than Disqualified Stock and other than sales to a Restricted Subsidiary of the Company) or from the issue or sale of convertible or exchangeable Disqualified Stock or convertible or exchangeable debt securities of the Company that have been converted into or exchanged for such Equity Interests (other than Disqualified Stock or debt securities sold to a Subsidiary of the Company), plus;

(iii)100% of the aggregate net cash proceeds received upon the sale or other disposition of any Restricted Investment made since the date of the indenture; plus the net reduction in Restricted Investments in any Person resulting from dividends, repayments of loans or advances or other transfers of assets subsequent to the date of the indenture, in each case to the Company or any Restricted Subsidiary from such person; plus to the extent that the ability to make Restricted Payments was reduced as the result of the designation of an Unrestricted Subsidiary, the portion (proportionate to the Company’s equity

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interest in such Subsidiary) of the Fair Market Value of the net assets of such Unrestricted Subsidiary at the time such Unrestricted Subsidiary is redesignated, or liquidated or merged into, a Restricted Subsidiary; provided, in each case, that the foregoing may not exceed, in the aggregate, the amount of all Investments which previously reduced the ability to make Restricted Payments, plus

(iv)50% of any cash dividends received by the Company or a Restricted Subsidiary of the Company after the date of the indenture from an Unrestricted Subsidiary of the Company, to the extent that such dividends were not otherwise included in Consolidated Net Income of the Company for such period.

(2)Notwithstanding the foregoing, this Section 6(A) shall not prohibit:

(a)the payment of any dividend within 60 days after the date of declaration of the dividend, if at the date of declaration the dividend payment would have complied with the provisions of this Supplemental Indenture;

(b)the redemption, repurchase, retirement, defeasance or other acquisition of any Subordinated Indebtedness of the Company or of any Equity Interests of the Company or any of its Restricted Subsidiaries in exchange for, or out of the net cash proceeds of the substantially concurrent sale (other than to a Restricted Subsidiary of the Company) of, Equity Interests of the Company (other than Disqualified Stock); provided that the amount of any such net cash proceeds that are utilized for any such redemption, repurchase, retirement, defeasance or other acquisition shall be excluded from clause 6(A)(1)(z)(ii);

(c)the defeasance, redemption, repurchase or other acquisition of Subordinated Indebtedness of the Company with the net cash proceeds from an incurrence of Permitted Refinancing Indebtedness;

(d)the payment of any dividend or other payment or distribution by a Restricted Subsidiary of the Company to the holders of its Equity Interests on a pro rata basis;

(e)the repurchase, redemption or other acquisition or retirement for value of any Equity Interests of the Company or any Restricted Subsidiary held by any current or former officer, director or employee of the Company (or any of its Restricted Subsidiaries) pursuant to any equity subscription agreement, stock option agreement, severance agreement or similar agreement; provided that the aggregate price paid for all such repurchased, redeemed, acquired or retired Equity Interests may not exceed $5.0 million in any twelve-month period;

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(f)the repurchase of Equity Interests upon the exercise of stock options to the extent such Equity Interests represent a portion of the exercise price of those stock options; provided that the aggregate price paid for all such repurchased Equity Interests may not exceed $5.0 million in any twelve-month period;

(g)the declaration and payment of dividends to holders of any class or series of Disqualified Stock of the Company or any of its Restricted Subsidiaries or preferred stock of its Restricted Subsidiaries issued in accordance with the terms of the Indenture, including this Supplemental Indenture;

(h)the declaration and payment of regular quarterly cash dividends in respect of the Company’s common stock in an aggregate amount not to exceed $8.0 million during the fourth quarter of the fiscal year 2004;

(i)payments, not to exceed $1.0 million in the aggregate since the date of the indenture, to holders of the Company’s Capital Stock in lieu of the issuance of fractional shares of its Capital Stock;

(j)the consummation of the transactions or the making of any payment specifically provided for, or required by, the Plan of Reorganization;

(k)the purchase, redemption, acquisition, cancellation or other retirements for a nominal value per right of any rights granted to all the holders of Capital Stock of the Company pursuant to any shareholder’s rights plan adopted for the purpose of protecting shareholders from unfair takeover tactics; provided, that any such purchase, redemption, acquisition, cancellation or other retirement of such rights is not for the purpose of evading the limitations of this covenant (all as determined in good faith by the Board of Directors of the Company);

(l)other Restricted Payments from and after January 1, 2005 in an aggregate amount not to exceed $60.0 million;

provided that, with respect to clauses (e), (g), (h) and (l) above, no Default or Event of Default shall have occurred and be continuing or would be caused by such transaction.

(3)The amount of all Restricted Payments (other than cash) shall be the Fair Market Value on the date of the Restricted Payment of the asset(s) or securities proposed to be transferred or issued by the Company or such Restricted Subsidiary, as the case may be, pursuant to the Restricted Payment. The Fair Market Value of any assets or securities that are required to be valued by this covenant shall be determined by the Board of Directors whose resolution with respect thereto shall be delivered to the Trustee; except that, if such Fair Market Value is less than $35 million, then such Fair Market Value may be determined by the Chief Financial Officer of the Company instead of the Board of Directors.

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(4)The provisions of this Section 6(A) (“Restricted Payments”) are subject to the provisions of Section 6(L) (“Covenants—Termination of Selected Covenants”).

(B)Incurrence of Indebtedness and Issuance of Preferred Stock.

(1)The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, “incur”) any Indebtedness (including Acquired Debt), and the Company shall not issue any Disqualified Stock and shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and any Restricted Subsidiary may incur Indebtedness (including Acquired Debt) or issue preferred stock if the Fixed Charge Coverage Ratio for the Company’s most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock or preferred stock is issued would have been at least 2.0 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred or Disqualified Stock or preferred stock had been issued, as the case may be, at the beginning of such four-quarter period.

(2)Notwithstanding the foregoing, this Section 6(B) shall not prohibit the incurrence of any of the following items of Indebtedness (collectively, “Permitted Debt”):

(a)the incurrence by the Company or any of its Restricted Subsidiaries pursuant to this clause (a) of additional Indebtedness and letters of credit under one or more Credit Facilities (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries thereunder), and/or pursuant to any Permitted Receivables Transactions (including any Receivables Facility Attributed Indebtedness), in an aggregate principal amount at any one time outstanding not to exceed $350.0 million, less the aggregate amount of all Net Proceeds of Asset Sales applied by the Company or any of its Restricted Subsidiaries since the date of the Indenture to repay any term or revolving Indebtedness under a Credit Facility, in each case pursuant to Section 6(E)(2)(a)(under the heading “Asset Sales”)  of this Article; provided, however, that the aggregate amount permitted to be incurred under the clause (a) shall in no event be reduced to below $150.0 million;

(b)the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;

(c)the incurrence by the Company of Indebtedness represented by the Securities of Series No. 1 to be issued on the Issue Date (and any related Securities of Series No. 2 to be issued pursuant to the Registration Rights Agreement);

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(d)the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of design,  construction, installation, or improvement or lease of property (real or personal), plant or equipment used in the business of the Company or its Restricted Subsidiaries, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance, replace, defease or discharge any Indebtedness incurred pursuant to this clause (d), not to exceed $50.0 million at any time outstanding;

(e)the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance, replace, defease or discharge Indebtedness (other than intercompany Indebtedness) that was incurred as permitted under Section 6(B)(1) or clauses (b), (c), (d), (q) or (r) of this Section 6(B)(2);

(f)the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among the Company or any of its Restricted Subsidiaries; provided, however, that:

(i)if the Company is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Securities of Series No. 1 or Series No. 2; and

(ii)(A) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary and (B) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary shall be deemed, in each case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (f);

(g)the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations;

(h)the guarantee by the Company or any of its Restricted Subsidiaries of Indebtedness of the Company or any of its Restricted Subsidiaries that was permitted to be incurred by another provision of this Section 6(B) (“Incurrence of Indebtedness and Issuance of Preferred Stock”), provided that in the event that the Indebtedness shall be subordinated in right of payment to the Securities of Series No. 1 or Series No. 2, then the Guarantee of that Indebtedness shall be subordinated in right of payment to such Securities;

(i)the accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in

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the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of such Disqualified Stock shall not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 6(B) (“Incurrence of Indebtedness and Issuance of Preferred Stock”); provided, in each such case, that the amount thereof is included in the Fixed Charges of the Company as accrued;

(j)the issuance by any of the Company’s Restricted Subsidiaries to the Company or to any of its Restricted Subsidiaries of shares of preferred stock; provided, however,

(i)any subsequent issuance or transfer of Equity Interests that results in any such preferred stock being held by a Person other than the Company or a Restricted Subsidiary of the Company; and

(ii)any sale or other transfer of any such preferred stock to a Person that is not either the Company or a Restricted Subsidiary of the Company;

will be deemed, in each case, to constitute an issuance of such preferred stock by such Subsidiary that was not permitted by this clause (j);

(k)the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in respect of workers’ compensation claims, self-insurance obligations, bankers’ acceptances and bid, performance and surety bonds, in each case in the ordinary course of business, including guarantees or obligations of the Company or any Restricted Subsidiary thereof with respect to letters of credit, issued in the ordinary course of business, supporting such obligations;

(l)the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently drawn against insufficient funds, so long as such Indebtedness is covered within 5 business days;

(m)the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness that may be deemed to arise as a result of agreements of the Company or any Restricted Subsidiary, providing for indemnification, adjustment or purchase price or similar obligations, in each case, incurred or assumed in connection with the disposition of any business, assets or Equity Interest of a Subsidiary, provided that the maximum aggregate liability in respect of all such Indebtedness shall at no time exceed the gross proceeds (including non-cash proceeds) actually received by the Company and/or such Subsidiary in connection with all such dispositions;

(n)the incurrence by the Company or any Restricted Subsidiary of the Company of Indebtedness represented by letters of credit, guarantees of Indebtedness or other similar instruments to the

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extent (i) such instruments are cash collateralized and (ii) the Company or such Restricted Subsidiary would have been permitted to expend the funds used to cash collateralize such instrument directly under the terms of the Indenture, including this Supplemental Indenture;

(o)the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness in connection with the deferred purchase price of goods or services, or progress payments in connection with such goods or services, including turbines, transformers and similar equipment, so long as such obligations are incurred in the ordinary course of business;

(p)the incurrence of Indebtedness by the Company or any of its Restricted Subsidiaries in the form of loans from an insurance company or insurance premium finance company to finance all or any portion of the premium of any insurance policy maintained by the Company or any of its Restricted Subsidiaries, so long as such insurance policy is written in the ordinary course of business and names the Company or any of its Restricted Subsidiaries as a named beneficiary thereunder;

(q)the incurrence of Indebtedness by the Company or any Restricted Subsidiary in connection with or related to the financing of the acquisition by the Company or any Restricted Subsidiary of the Company’s existing undivided leasehold interests in Colstrip IV, including the assumption of any Indebtedness associated with such interest;

(r)the incurrence by the Company or any Restricted Subsidiary of additional Indebtedness in an aggregate principal amount (or accreted value, as applicable), including all Permitted Refinancing Indebtedness incurred to refund, refinance, replace, defease or discharge any Indebtedness incurred pursuant to this clause (r), not to exceed $40.0 million at any time outstanding.

(3)For purposes of determining compliance with this Section 6(B) (“Incurrence of Indebtedness and Issuance of Preferred Stock”):

(a)in the event that an item of proposed Indebtedness, including Acquired Debt, meets the criteria of more than one of the categories of Permitted Debt described in clauses (a) through (r) above, or is entitled to be incurred pursuant to the first paragraph of this Section 6(B), the Company shall be permitted to classify (or later classify or reclassify such Indebtedness, in whole or in part in its sole discretion) such item of Indebtedness in any manner that complies with this Section 6(B); and

(b)for the purposes of determining compliance with any dollar-denominated restriction on the incurrence of Indebtedness denominated in a foreign currency, the dollar-equivalent principal amount of such Indebtedness incurred pursuant thereto shall be

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calculated based on the relevant currency exchange rate in effect on the date that such Indebtedness was incurred.

(4)The provisions of this Section 6(B) (“Incurrence of Indebtedness and Issuance of Preferred Stock”) are subject to the provisions of Section 6(L) (“Covenants—Termination of Selected Covenants”).

(C)Liens.

(1)The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, assume or otherwise cause or suffer to exist or become effective any Lien of any kind securing Indebtedness, Attributable Debt or trade payables on any of their property or assets, now owned or hereafter acquired, except Permitted Liens.

(2)The provisions of this Section 6(C) (“Liens”) are subject to the provisions of Section 6(L) (“Covenants – Termination of Selected Covenants”).

(D)Dividend and Other Payment Restrictions Affecting Subsidiaries.

(1)The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create or permit to exist or become effective any consensual encumbrance or restriction on the ability of any Restricted Subsidiary to:

(a)pay dividends or make any other distributions on its Capital Stock to the Company or any of its Restricted Subsidiaries, or with respect to any other interest or participation in, or measured by, its profits, or pay any Indebtedness owed to the Company or any of its Restricted Subsidiaries;

(b)make loans or advances to Company or any of its Restricted Subsidiaries; or

(c)transfer any of its properties or assets to the Company or any of its Restricted Subsidiaries.

(2)Notwithstanding the foregoing, this Section 6(D) shall not apply to encumbrances or restrictions existing under or by reason of:

(a)agreements governing Existing Indebtedness and Credit Facilities as in effect on the Issue Date and any amendments, modifications, restatements, renewals, increases, supplements, refundings, replacements or refinancings of the agreements and other customary encumbrances and restrictions existing on or after the Issue Date that are not more restrictive, taken as a whole, with respect to such dividend and other payment restrictions than those contained in those agreements on the Issue Date; provided that the application of such restrictions or encumbrances to additional Restricted Subsidiaries not subject thereto on the Issue Date shall not be deemed to make such restrictions more restrictive;

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(b)the Indenture, including this Supplemental Indenture, the Mortgages, the Securities of Series No. 1 and Series No. 2 and the related First Mortgage Bonds;

(c)applicable law (including, without limitation, rules, regulations and agreements with regulatory authorities) or any order issued pursuant to a federal, state or local statute or any order by or agreement with any court or governmental agency or body having jurisdiction over the Company or any of its Subsidiaries or any of their respective properties;

(d)any instrument governing Indebtedness or Capital Stock of a Person acquired by the Company or any of its Restricted Subsidiaries as in effect at the time of such acquisition (except to the extent such Indebtedness or Capital Stock was incurred in connection with or in contemplation of such acquisition), which encumbrance or restriction is not applicable to any Person, or the properties or assets of any Person, other than the Person, or the property or assets of the Person, so acquired; providedthat, in the case of Indebtedness, such Indebtedness was permitted by the terms of this Supplemental Indenture to be incurred;

(e)customary encumbrances and restrictions (including, without limitation, net worth restrictions, restrictions on transfer, non-assignment provisions or subletting provisions) contained in contracts, leases, permits, licenses and other agreements entered into in the ordinary course of business;

(f)purchase money obligations for property acquired in the ordinary course of business and Capital Lease Obligations that impose restrictions on the property, purchased or leased,  of the nature described in clause 6(D)(1)(c) of this Article;

(g)any agreement for the sale or other disposition of a Restricted Subsidiary that restricts distributions or dispositions of assets by that Restricted Subsidiary pending its sale or other disposition;

(h)Permitted Refinancing Indebtedness; providedthat the restrictions contained in the agreements governing such Permitted Refinancing Indebtedness are not materially more restrictive, taken as a whole, than those contained in the agreements governing the Indebtedness being refinanced;

(i)Liens securing Indebtedness otherwise permitted to be incurred under the provisions of Section 6(C) of the Article (“Liens”) that limit the right of the debtor to dispose of the assets subject to such Liens;

(j)provisions prohibiting or limiting the disposition or distribution of assets or property in joint venture agreements, asset sale agreements, stock sale agreements, sale-leaseback agreements and other

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similar agreements entered into in the ordinary course of business; provided that such prohibitions or limitations are applicable only to the assets that are subject to such agreement;

(k)any Indebtedness or contractual requirements incurred with respect to a Permitted Receivables Transaction relating exclusively to a Receivables SPV that, in the good faith determination of the Board of Directors of the Company, are necessary to effect such Permitted Receivables Transaction;

(l)restrictions on cash or other deposits or net worth imposed by customers under contracts entered into in the ordinary course of business;

(m)Indebtedness of a Restricted Subsidiary of the Company existing at the time it became a Restricted Subsidiary if such restriction was not created in connection with or in anticipation of the transaction or series of transactions pursuant to which such Subsidiary became a Restricted Subsidiary or was acquired by the Company;

(n)with respect to Section 6(D)(1)(c) of this Article only, restrictions encumbering property at the time such property was acquired by the Company or any of its Subsidiaries, so long as such restriction relates solely to the property so acquired and was not created in connection with or in anticipation of such acquisition;

(o)an agreement governing Indebtedness permitted to be incurred pursuant to the covenant described in Section 6(B) (“Incurrence of Indebtedness and Issuance of Preferred Stock”); provided that the provisions relating to such encumbrances or restrictions contained in such Indebtedness, taken as a whole, are not materially more restrictive than those contained in the indenture governing the Securites of Series No. 1 and Series No. 2;

(p)encumbrances or restrictions on Excluded Assets; and

(q)any encumbrance or restriction of the type referred to in Sections 6(D)(1)(a), 6(D)(1)(b), 6(D)(1)(c) of this Article imposed by any amendments, modifications, restatements, renewals, increases, supplements, refundings, replacements or refinancings of the contracts, instruments or obligations referred to in clauses (a) through (p) of this Section 6(D); provided that such amendments, modifications, restatements, renewals, increases, supplements, refundings, replacements or refinancings are no more materially restrictive with respect to such dividend and other payment restrictions than those contained in the dividend or other payment restrictions prior to such amendment, modification, restatement, renewals, increase, supplement, refunding, replacement or refinancing.

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(3)The provisions of this Section 6(D) (“Dividends and Other Payment Restrictions Affecting Restricted Subsidiaries”) are subject to the provisions of Section 6(L) (“Covenants—Termination of  Selected Covenants”).

(E)Asset Sales.

(1)The Company shall not, and shall not permit any of its Restricted Subsidiaries to, consummate an Asset Sale unless:

(a)the Company (or the Restricted Subsidiary, as the case may be) receives consideration at the time of the Asset Sale at least equal to the Fair Market Value of the assets or Equity Interests issued or sold or otherwise disposed of; and

(b)at least 75% of the consideration received in the Asset Sale by the Company or such Restricted Subsidiary is in the form of cash. For purposes of this Section 6(E)(1)(b), each of the following shall be deemed to be cash:

(i)any liabilities of the Company or any Restricted Subsidiary, as shown on the Company’s or such Restricted Subsidiary’s most recent consolidated balance sheet (other than contingent liabilities and liabilities that are by their terms subordinated to the Securities of Series No. 1 and Series No. 2) that are assumed by the transferee of any such assets pursuant to a customary novation agreement that releases the Company or such Restricted Subsidiary from further liability;

(ii)any securities, notes or other obligations received by the Company or any such Restricted Subsidiary from such transferee that are converted by the Company or such Restricted Subsidiary into cash within 90 days of the receipt of such securities, notes or other obligations, to the extent of the cash received in that conversion; and

(iii)any consideration in the form of readily marketable securities.

(2)Within 365 days after the receipt of any Net Proceeds from an Asset Sale, the Company may apply those Net Proceeds at its option:

(a)to repay Secured Indebtedness of the Company or any Restricted Subsidiary, including Senior Secured Debt under a Credit Facility, provided that such Indebtedness is not Subordinated Indebtedness;

(b)to acquire all or substantially all of the assets of, or a majority of the Voting Stock of, another Person engaged primarily in a Permitted Business;

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(c)in the case of the sale of assets subject to the Lien of a Mortgage, if required by the terms of such Mortgage, to deposit such Net Proceeds with the trustee under such Mortgage, including, without limitation, for purposes of obtaining the release of such assets from such Lien as a condition to such sale; except that if such Net Proceeds are subsequently withdrawn by the Company, such Net Proceeds shall, as of the date of such withdrawal, not be considered applied or invested as provided in this Section 6(E)(2)(c) for purposes of determining the amount of Excess Proceeds as described below (but if applied as provided in paragraphs (a), (b), (d), (e) or (f) of this Section 6(E)(2), such Net Proceeds shall not be considered “Excess Proceeds,” it being understood that Net Proceeds will be deemed to have been so applied if and to the extent withdrawn from a Mortgage on the basis of property additions acquired within 365 days of such withdrawal by the Company (i) other than property additions made in the ordinary course of business or (ii) property additions made specifically for the purpose of obtaining such withdrawal);

(d)to make a capital expenditure in connection with a Permitted Business;

(e)to acquire other long-term assets that are used or useful in a Permitted Business; or

(f)any combination of the foregoing.

Pending the final application of any Net Proceeds, the Company may temporarily reduce revolving credit borrowings or otherwise invest the Net Proceeds in any manner that is not prohibited by this Supplemental Indenture.

(3)Any Net Proceeds from Asset Sales that are not applied or invested as provided in Section 6(E)(2) hereof shall constitute “Excess Proceeds.” When the aggregate amount of Excess Proceeds exceeds $30.0 million, the Company shall make an Asset Sale Offer pursuant to the provisions of Section 4 of this Article.

(4)To the extent that any Asset Sale constitutes the sale, conveyance or other disposition of all or substantially all of the assets of the Company and its Restricted Subsidiaries taken as a whole, such transaction shall be governed by the provisions of this Article in Sections 3 and 6(F) (under the heading “Offer to Purchase Upon a Change of Control” and the heading “Covenants—Merger, Consolidation or Sale of Assets”) and not by the provisions of this Section 6(E) or Section 4 of this Article.

(5)The provisions of this Section 6(E) are subject to the provisions of Section 6(L) (“Covenants – Termination of Selected Covenants”).

(F)Merger, Consolidation or Sale of Assets.

(1)The Company shall not, directly or indirectly consolidate with or merge into any other Person, or convey, or otherwise transfer or dispose of, or

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lease, the properties of the Company and its Restricted Subsidiaries, taken as a whole, as or substantially as an entirety, to another Person, in one or more related transactions; unless:

(a)the Company or the Person formed by such consolidation or into which the Company is merged or the Person which acquires by conveyance or other transfer, or which leases, the properties of the Company and its Restricted Subsidiaries, taken as a whole, as or substantially as an entirety, complies with Article Ten of the Original Indenture and the Person formed by or surviving any such consolidation or merger (if other than the Company) or to which such sale, transfer, conveyance or other disposition or lease has been made, shall be deemed a Successor under the Indenture;

(b)the Successor shall expressly assume the due and punctual payment of the principal of and premium, if any, and interest, if any, on all Securities of Series No. 1 and Series No. 2 and the related First Mortgage Bonds, and the performance and observation of every covenant and condition of the Indenture, the Registration Rights Agreement, the Montana Mortgage and the South Dakota Mortgage; and

(c)the Company or the Person formed by or surviving any such consolidation or merger (if other than the Company), or to which such sale, assignment, transfer, conveyance or other disposition has been made shall, on the date of such transaction after giving pro forma effect thereto and any related financing transactions as if the same had occurred at the beginning of the applicable four-quarter period, be permitted to incur at least $1.00 of additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test set forth in Section 6(B)(1) of this Supplemental Indenture (under the heading “Incurrence of Indebtedness and Issuance of Preferred Stock”); provided, however, that this clause (c) shall be subject to the termination provisions of Section 6(L) (“Covenants – Termination of Selected Covenants”).

(2)The requirements described in clause (c) of Section 6(F)(1) of this Article shall not apply to:

(a)a merger of the Company with an Affiliate solely for the purpose of reincorporating the Company in another jurisdiction;

(b)any sale, transfer, assignment, conveyance, lease or other disposition of assets between or among the Company and its Restricted Subsidiaries; or

(c)any sale, transfer, assignment, conveyance, lease or other disposition of Excluded Assets.

(3)This Section 6(F) does not prevent or restrict:

(a)any conveyance or other transfer, or lease, of any part of the Company’s properties which does not constitute the entirety, or

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substantially the entirety, thereof; or

(b)any consolidation or merger with another Person where the Company is the surviving corporation or any conveyance, or other transfer, or lease of properties of any Restricted Subsidiaries to the Company.

(4)The entity or Person formed by or surviving any consolidation or merger (if other than the Company) shall succeed to, and be substituted for, and may exercise every right and power of the Company under the indenture.  In the event of a consolidation, merger or transfer of assets in accordance with the provisions above and Article Ten of the Original Indenture (except in the case of a lease), the Company shall be released and discharged from all obligations under the Indenture and on the Securities of Series No. 1 and Series No. 2 then outstanding.

(G)Transactions with Affiliates.

(1)The Company shall not, and will not permit any of its Restricted Subsidiaries to, make any payment to, or sell, lease, transfer or otherwise dispose of any of its properties or assets to, or purchase any property or assets from, or enter into or make or amend any transaction, contract, agreement, understanding, loan, advance or guarantee with, or for the benefit of, any Affiliate (each, an “Affiliate Transaction”), unless:

(a)the Affiliate Transaction is on terms that are no less favorable (as reasonably determined in good faith by the Company) to the Company or the relevant Restricted Subsidiary than those that would have been obtained in a comparable transaction by the Company or such Restricted Subsidiary with an unrelated third party; and

(b)the Company delivers to the Trustee:

(i)with respect to any Affiliate Transaction or series of related Affiliate Transactions involving aggregate consideration in excess of $15.0 million, a resolution of the Board of Directors set forth in an Officer’s Certificate certifying that such Affiliate Transaction complies with this Section 6(G) and that such Affiliate Transaction has been approved by a majority of the disinterested members of the Board of Directors; and

(ii)with respect to any Affiliate Transaction or series of related Affiliate Transactions involving aggregate consideration in excess of $40.0 million, an opinion as to the fairness to the Company or such Restricted Subsidiary of such Affiliate Transaction from a financial point of view issued by an accounting, appraisal or investment banking firm of national standing.

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(2)The following items shall not be deemed to be Affiliate Transactions and, therefore, shall not be subject to the provisions of Section 6(G)(1) of this Article:

(a)any employment agreement, directors’ letter, employment benefit plan, officer and director indemnification agreement or similar agreement entered into by the Company or any of its Restricted Subsidiaries in the ordinary course of business or approved by the Board of Directors in good faith;

(b)transactions between or among the Company and/or its Restricted Subsidiaries;

(c)transactions with a Person that is an Affiliate of the Company solely because the Company or a Restricted Subsidiary owns or controls, directly or indirectly, an Equity Interest in such Person;

(d)payment of reasonable directors fees to Persons who are not otherwise Affiliates of the Company;

(e)issuances of Equity Interests (other than Disqualified Stock) to Affiliates of the Company or its Restricted Subsidiaries;

(f)Permitted Investments pursuant to this Supplemental Indenture and Restricted Payments that are permitted by the provisions of Section 6(A) of this Article (under the heading “Restricted Payments”);

(g)fees, compensation and advances paid to and indemnity provided on behalf of directors, officers, employees or consultants of the Company or any Restricted Subsidiary of the Company in the ordinary course of business;

(h)transactions pursuant to any agreement in effect on the date of this Supplemental Indenture as the same may be amended from time to time in any manner not materially less favorable to the Holders of the Securities of Series No. 1 and Series No. 2;

(i)loans or advances to officers, directors and employees of the Company or any Restricted Subsidiary made in the ordinary course of business, and in compliance with applicable law in an aggregate amount not to exceed $5.0 million outstanding at any one time;

(j)sales or other transfers or dispositions of accounts receivable and other related assets in a Permitted Receivables Transaction, and acquisitions of Permitted Investments in connection with a Permitted Receivables Transaction and other transactions contemplated by the associated Receivables Purchase Documents;

(k)transactions with customers, clients, suppliers, joint venture partners or purchasers or sellers of goods or services, in each

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case, in the ordinary course of business (including pursuant to joint venture agreements) and otherwise in compliance with the terms of the indenture that are fair to the Company and its Restricted Subsidiaries, in the reasonable determination of the Company, or are on terms not materially less favorable taken as a whole as might reasonably have been obtained at such time from an unaffiliated party;

(l)any repurchase, redemption or other retirement of Capital Stock of the Company held by employees of the Company or any of its Subsidiaries at a price not in excess of the Fair Market Value thereof, and, if greater than $5.0 million, approved by the Board of Directors;

(m)the transactions or payments specifically provided for in, or required by, the Plan of Reorganization and the payment of all fees and expenses related thereto; and

(n)any agreement to do any of the activities described in clauses (a) through (m) of this paragraph.

(3)The provisions of this Section 6(G) (“Transactions with Affiliates”) are subject to the provisions of Section 6(L) of this Article (“Covenants—Termination of Selected Covenants”).

(H)Sale and Leaseback Transactions.

(1)The Company shall not, and shall not permit any of its Restricted Subsidiaries to, enter into any sale and leaseback transaction; provided that the Company or any Restricted Subsidiary may enter into a sale and leaseback transaction if:

(a)the Company or that Restricted Subsidiary could have incurred Indebtedness in an amount equal to the Attributable Debt relating to such sale and leaseback transaction under the Fixed Charge Coverage Ratio test in Section 6(B)(1) of this Article (under the heading “Incurrence of Indebtedness and Issuance of Preferred Stock”);

(b)the gross cash proceeds of that sale and leaseback transaction are at least equal to the Fair Market Value, as determined in good faith by the Board of Directors and set forth in an Officer’s Certificate delivered to the Trustee, of the property that is the subject of that sale and leaseback transaction; and

(c)if such sale and leaseback transaction constitutes an Asset Sale, the transfer of assets in that sale and leaseback transaction is permitted by, and the Company applies the proceeds of such transaction in compliance with, Section 4 of this Article (“Offer to Purchase by Application of Excess Proceeds”) and Section 6(E) of this Article (“Covenants—Asset Sales”).

(2)The provisions of this Section 6(H) are subject to the provisions

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of Section 6(L) of this Article (“Covenants – Termination of Selected Covenants”).

(I)Business Activities.

(1)The Company shall not, and shall not permit any of its Restricted Subsidiaries to, engage in any business other than Permitted Businesses, except to such extent as would not be material to the Company and its Subsidiaries taken as a whole.

(2)The provisions of this Section 6(I) (“Business Activities”) are subject to the provisions of Section 6(L) of this Article (“Covenants—Termination of Selected Covenants”).

(J)Payments for Consent.

(1)The Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, pay or cause to be paid any consideration to or for the benefit of any Holder of Securities of Series No. 1 or Series No. 2 for or as an inducement to any consent, waiver or amendment of any of the terms or provisions of this Supplemental Indenture or such Securities unless such consideration is offered to be paid and is paid to all Holders of such Securities that consent, waive or agree to amend in the time frame set forth in the solicitation documents relating to such consent, waiver or agreement.

(K)Reports.

(1)Whether or not required by the Commission, so long as any Securities of Series No. 1 or Series No. 2 are outstanding, the Company shall make available to the Trustee, within the time periods specified in the Commission’s rules and regulations (as if required):

(a)all quarterly and annual financial information that would be required to be contained in a filing with the Commission on Forms 10-Q and 10-K if the Company were required to file such Forms, including a “Management’s Discussion and Analysis of Financial Condition and Results of Operations”; and

(b)all current reports that would be required to be filed with the Commission on Form 8-K if the Company were required to file such reports.

(2)In addition, whether or not required by the Commission, the Company shall file a copy of all of the information and reports referred to in clauses (a) and (b) of Section 6(K)(1) of this Article with the Commission for public availability within the time periods specified in the Commission’s rules and regulations (unless the Commission shall not accept such a filing) and make such information available to securities analysts and prospective investors upon request. In addition, the Company has agreed that, for so long as any Securities of Series No. 1 or Series No. 2 remain outstanding, at any time they are not required to file the reports required by the preceding paragraphs with the

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Commission, they shall furnish to the Holders of such Securities and to prospective investors, upon their request, the information required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act.

(3)Delivery of reports, information and documents to the Trustee under this Section 6(K) is for informational purposes only and the Trustee’s receipt of the foregoing shall not constitute constructive notice of any information contained therein or determinable from information contained  therein, including the Company’s compliance with any of their covenants hereunder (as to which the Trustee is entitled to rely exclusively on one or more Officer’s Certificates).

(L)Termination of  Selected Covenants.

From and after the time that the Securities have an Investment Grade Rating from both of the Rating Agencies and no Default or Event of Default has occurred and is continuing under this Supplemental Indenture, the Company and its Restricted Subsidiaries shall not thereafter be subject to the following provisions:  Section 3, Section 4, Section 6(A), Section 6(B), Section 6(C), Section 6(D), Section 6(E), Section 6(F)(1)(c), Section 6(G), Section 6(H) and Section 6(I) of this Article (collectively, the Sections entitled “Offer to Purchase Upon Change of Control,” “Offer to Purchase by Application of Excess Proceeds,” “Covenants—Restricted Payments,” “Covenants—Incurrence of Indebtedness and Issuance of Preferred Stock,” “Covenants—Liens,” “Covenants—Dividend and Other Payment Restrictions Affecting Subsidiaries,” “Covenants—Asset Sales,” “Covenants—Transactions with Affiliates,” “Covenants—Sale and Leaseback Transactions,” and “Covenants—Business Activities”) (collectively, the “Terminated Covenants”); provided, however, that the provisions in Section 6(F) (except with respect to Section 6(F)(1)(c) thereof, as set forth in that Section 6(F)), Section 6(J) and Section 6(K) (under the headings “Covenants—Merger, Consolidation or Sale of Assets” (except as set forth thereunder), “Covenants—Payments for Consent,” and “Reports”) of  this Supplemental Indenture shall not be so terminated and shall continue to be effective so long as the Securities of Series No. 1 and Series No. 2 remain outstanding.

(M)Designation of Restricted and Unrestricted Subsidiaries.

(1)The Board of Directors may designate any Restricted Subsidiary to be an Unrestricted Subsidiary if that designation would not cause a Default or Event of Default.  If a Restricted Subsidiary is designated as an Unrestricted Subsidiary, the aggregate Fair Market Value of all outstanding Investments owned by the Company and its Restricted Subsidiaries in the Subsidiary so properly designated will be deemed to be an Investment made as of the time of the designation and will reduce the amount available for Restricted Payments under the first paragraph of the covenant described above under the caption “Restricted Payments” in Section 6(A)(1) of this Article or Permitted Investments as determined by the Company.  That designation will only be permitted if the Investment would be permitted at that time and if the Restricted Subsidiary otherwise meets the definition of an Unrestricted Subsidiary.

(2)The Board of Directors of the Company may at any time designate any Unrestricted Subsidiary to be a Restricted Subsidiary; provided

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that no Default or Event of Default would be in existence following such redesignation.

(N)Limitation on Release of Mortgaged Property;  The Company shall not release Mortgaged Property (as defined in the South Dakota Mortgage) from the Lien of the South Dakota Mortgage, pursuant to and in accordance with Section 8.03 of the South Dakota Mortgage.

(O)Limitation on Subjecting Property or Other Assets to the Lien of the Other Mortgage.  The Company shall not subject any property or other assets to the lien of the Montana Mortgage or the lien of the South Dakota Mortgage if such property or other assets are subject to the lien of the other Mortgage.

(P)Prohibition on Designating Class “A” Mortgages or Permitting Qualified Lien Bonds to Exist.  The Company shall not designate any Class “A” Mortgage under the South Dakota Mortgage or permit any Qualified Lien Bonds to exist under the Montana Mortgage.

(Q)The covenants in this Section 6 of Article Four and the covenants and provisions specified in Sections 3 (“Offer to Purchase Upon Change of Control”), 4 (“Offer to Purchase by Application of Excess Proceeds”), 5 (“Offers to Purchase—General”), and 8 (“Events of Default”) are established pursuant to Sections 301(p) and 701(g) of the Original Indenture and, subject to compliance with the conditions of Article 6 of the Original Indenture, are “defeasible covenants” within the meaning of Section 603 of the Original Indenture; and the occurrence of an event specified in Section 8 (“Events of Default”) of this Article Four shall not be deemed to be an Event of Default with respect to any Securities so “defeased” in accordance with Section 603 of the Original Indenture.

SECTION 7.Definitions.  Set forth below are certain defined terms used in this Supplemental Indenture.  Reference is made to the Indenture for a full disclosure of all such terms, as well as any other capitalized terms used herein for which no definition is provided.

(A)“Acquired Debt” means, with respect to any specified Person:

(1)Indebtedness of any other Person existing at the time such other Person is merged with or into or became a Subsidiary of such specified Person, whether or not such Indebtedness is incurred in connection with, or in contemplation of, such other Person merging with or into, or becoming a Subsidiary of, such specified Person; and

(2)Indebtedness secured by a Lien encumbering any asset acquired by such specified Person.

(B)“Affiliate” of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person.  For purposes of this definition, “control,” as used with respect to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by agreement or otherwise; provided that beneficial ownership of 10% or more of the Voting Stock of a Person will be deemed to be control.

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For purposes of this definition, the terms “controlling,” “controlled by” and “under common control with” have correlative meanings.

(C)“Applicable Procedures” means, with respect to any transfer or exchange of or for beneficial interests in any Global Security, the rules and procedures of the Depositary, Euroclear and Clearstream that apply to such transfer or exchange.

(D)“Asset Sale” means:

(1)the sale, lease, conveyance or other disposition of any assets or rights, provided that the sale, conveyance or other disposition of all or substantially all of the assets of the Company and its Restricted Subsidiaries taken as a whole will be governed by Section 3 (“Offer to Purchase Upon Change of Control”) and/or Section 6(F) (“Covenants—Merger, Consolidation or Sale of Assets”) and not by the provisions of the Asset Sale covenant; and

(2)the issuance of Equity Interests in any of the Company’s Restricted Subsidiaries or the sale of Equity Interests in any of its Restricted Subsidiaries.

Notwithstanding the preceding, the following items will not be deemed to be Asset Sales:

(1)the sale, transfer or lease of products or services in the ordinary course of business or the disposition of damaged, worn-out or obsolete assets in the ordinary course of business;

(2)any single transaction or series of related transactions for which the Company or its Restricted Subsidiaries receive aggregate cash consideration of less than $8.0 million;

(3)a transfer of assets between or among the Company and its Restricted Subsidiaries;

(4)an issuance of Equity Interests by a Restricted Subsidiary to the Company or to another Restricted Subsidiary of the Company (including any Person that becomes a Restricted Subsidiary of the Company in connection with such transaction);

(5)sales or transfers of Receivables, Receivables and Related Security, accounts or notes receivable under any Receivables Purchase Document in connection with a Permitted Receivables Transaction;

(6)the licensing of intellectual property;

(7)the sale or other disposition of cash or Cash Equivalents;

(8)(a) a disposition of assets (other than any assets securing Senior Secured Debt) in connection with a foreclosure, transfer or deed in lieu of foreclosure or other exercise of remedial action by the Company or any Restricted Subsidiary or (b) dispositions of property subject to a Permitted Lien that is transferred to the lienholder or its designee in satisfaction or settlement of

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such lienholder’s claim or a realization upon any Lien permitted pursuant to the Indenture;

(9)the sale, lease, conveyance or other disposition for value of fuel or emission credits in the ordinary course of business;

(10)the transfer, sale or lease of Excluded Assets; and

(11)a Restricted Payment that is permitted by Section 6(A) (“Covenants—Restricted Payments”) or a Permitted Investment.

(E)“Asset Sale Offer” has the meaning assigned to it in Section 4 of this Article.

(F)“Attributable Debt” in respect of a sale and leaseback transaction means, at the time of determination, the present value of the obligation of the lessee for net rental payments during the remaining term of the lease included in such sale and leaseback transaction including any period for which such lease has been extended or may, at the option of the lessor, be extended.  Such present value shall be calculated using a discount rate equal to the rate of interest implicit in such transaction, determined in accordance with GAAP; provided, however, that if such sale and leaseback transaction results in a Capital Lease Obligation, the amount of Indebtedness represented thereby will be determined in accordance with the definition of “Capital Lease Obligation.”

(G)“Beneficial Owner” has the meaning assigned to such term in Rule 13d-3 and Rule 13d-5 under the Exchange Act, except that in calculating the beneficial ownership of any particular “person” (as that term is used in Section 13(d)(3) of the Exchange Act), such “person” will be deemed to have beneficial ownership of all securities that such “person” has the right to acquire by conversion or exercise of other securities, whether such right is currently exercisable or is exercisable only upon the occurrence of a subsequent condition.  The terms “Beneficially Owns” and “Beneficially Owned” have a corresponding meaning.

(H)“Board of Directors” means:

(1)with respect to a corporation, the board of directors of the corporation or any committee of such board of directors duly authorized to act for the corporation;

(2)with respect to a partnership, the Board of Directors of the general partner of the partnership;

(3)with respect to a limited liability company, the managing member or members or any controlling committee of managing members thereof; and

(4)with respect to any other Person, the board or committee of such Person serving a similar function.

(I)“Broker-Dealer” has the meaning set forth in the Registration Rights Agreement.

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(J)“Capital Lease Obligation” means, at the time any determination is to be made, the amount of the liability in respect of a capital lease that would at that time be required to be capitalized on a balance sheet in accordance with GAAP, and the Stated Maturity thereof shall be the date of the last payment of rent or any other amount due under such lease prior to the first date upon which such lease may be prepaid by the lessee without payment of a penalty.

(K)“Capital Stock” means:

(1)in the case of a corporation, corporate stock;

(2)in the case of an association or business entity, any and all shares, interests, participations, rights or other equivalents (however designated) of corporate stock;

(3)in the case of a partnership or limited liability company, partnership or membership interests (whether general or limited); and

(4)any other interest or participation that confers on a Person the right to receive a share of the profits and losses of, or distributions of assets of, the issuing Person.

(L)“Cash Equivalents” means:

(1)United States dollars;

(2)securities issued or directly and fully guaranteed or insured by the United States government or any agency or instrumentality of the United States government (provided that the full faith and credit of the United States is pledged in support of those securities) having maturities of not more than one year from the date of acquisition;

(3)certificates of deposit and eurodollar time deposits with maturities of one year or less from the date of acquisition, bankers’ acceptances with maturities not exceeding one year and overnight bank deposits, in each case, with any domestic commercial bank having capital and surplus in excess of $500.0 million and a Thomson Bank Watch Rating of “B” or better;

(4)repurchase obligations with a term of not more than seven days for underlying securities of the types described in clauses (2) and (3) above entered into with any financial institution meeting the qualifications specified in clause (3) above;

(5)commercial paper having one of the two highest ratings obtainable from Moody’s or S&P and in each case maturing within one year after the date of acquisition; and

(6)money market funds at least 95% of the assets of which constitute Cash Equivalents of the kinds described in clauses (1) through (5) of this definition.

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(M)“Change of Control” means the occurrence of any of the following, in each case except in connection with the issuance of any Equity Interests pursuant to the Plan of Reorganization or any secondary offering of the Equity Interests issued pursuant to the Plan of Reorganization:

(1)the direct or indirect sale, transfer, conveyance or other disposition (other than by way of merger or consolidation), in one or a series of related transactions, of all or substantially all of the properties or assets of the Company and its Subsidiaries taken as a whole to any “person” (as that term is used in Section 13(d)(3) of the Exchange Act, including any “group” with the meaning of the Exchange Act) other than to the Company, any employee benefit plan of the Company or any of its Restricted Subsidiaries, or any person or entity acting in its capacity as trustee, agent or other fiduciary or administrator of such plan;

(2)the adoption of a plan relating to the liquidation or dissolution of the Company;

(3)the consummation of any transaction (including, without limitation, any merger or consolidation) the result of which is that any “person” (as defined above) becomes the Beneficial Owner, directly or indirectly, of more than 40% of the Voting Stock of the Company, measured by voting power rather than number of shares; or

(4)the first day on which a majority of the members of the Board of Directors of the Company are not Continuing Directors.

(N)“Change of Control Offer” has the meaning assigned to it in Article Four, Section 3(A).

(O)“Change of Control Payment” has the meaning assigned to it in Article Four, Section 3(A).

(P)“Change of Control Payment Date” has the meaning assigned to it in Article Four, Section 3(B)(2).

(Q)“Clearstream” means Clearstream Banking, société anonyme.

(R)“Colstrip IV” means all assets and property of any kind relating to the Company’s interest in Unit 4 of the Colstrip generating project in the vicinity of Colstrip, Montana, including real property interests, contracts, transferable permits and other tangible and intangible assets relating to the forgoing.  The Colstrip 4 Interest includes the Company’s leasehold interest in a 30% undivided interest in Unit 4 and a 15% undivided interest in the common facilities relating thereto which was sold and leased back pursuant to a lease financing transaction, certain retained assets which were not part of the lease financing, fee interests in the plant site property and related property, the related interest in the Ownership and Operation Agreement related to Units 3 and 4, and contracts for the sale of power from Unit 4.

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(S)“Consolidated Cash Flow” means, with respect to any specified Person for any period, the Consolidated Net Income of such Person for such period plus, without duplication:

(1)an amount equal to any extraordinary loss plus any net loss realized by such Person or any of its Restricted Subsidiaries in connection with (a) an Asset Sale, (b) the disposition of any securities by such Person or any of its Restricted Subsidiaries or (c) the extinguishment of any Indebtedness of such Person or any of its Restricted Subsidiaries, in each case, to the extent such losses were deducted in computing such Consolidated Net Income; plus

(2)provision for taxes based on income or profits of such Person and its Restricted Subsidiaries for such period, to the extent that such provision for taxes was deducted in computing such Consolidated Net Income; plus

(3)the Fixed Charges of such Person and its Restricted Subsidiaries for such period, to the extent that any such expense was deducted in computing such Consolidated Net Income; plus

(4)depreciation, depletion, amortization (including amortization of goodwill and other intangibles but excluding amortization of prepaid cash expenses that were paid in a prior period) and other non-cash charges and expenses (excluding any such non-cash expense to the extent that it represents an accrual of or reserve for cash expenses in any future period or amortization of a prepaid cash expense that was paid in a prior period) of such Person and its Restricted Subsidiaries for such period to the extent that such depreciation, depletion, amortization and other non-cash expenses were deducted in computing such Consolidated Net Income; plus

(5)any non-cash compensation charges, including any such charges arising from stock options, restricted stock grants or other equity incentive programs to the extent that such charges were deducted in computing such Consolidated Net Income; minus

(6)non-cash items increasing such Consolidated Net Income for such period, other than the accrual of revenue or the reversal of an accrued expense, in each case, in the ordinary course of business,

in each case, on a consolidated basis and determined in accordance with GAAP.

(T)“Consolidated Net Income” means, with respect to any specified Person for any period, the aggregate of the Net Income of such Person and its Restricted Subsidiaries for such period, on a consolidated basis, determined in accordance with GAAP; provided that:

(1)the Net Income (but not loss) of any Person that is not a Restricted Subsidiary or that is accounted for by the equity method of accounting will be included only to the extent of the amount of dividends or distributions paid in cash to the specified Person or a Restricted Subsidiary of the Person;

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(2)the Net Income of any Restricted Subsidiary will be excluded to the extent that the declaration or payment of dividends or similar distributions by that Restricted Subsidiary of that Net Income is not at the date of determination permitted without any prior governmental approval (that has not been obtained) or, directly or indirectly, by operation of the terms of its charter or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to that Restricted Subsidiary or its stockholders;

(3)the cumulative effect of a change in accounting principles will be excluded;

(4)cash received or paid during such period related to mark-to-market activities will be included, but all non-cash mark-to-market earnings or losses shall be excluded; and

(5)all extraordinary, unusual or non-recurring items of loss or expense and all extraordinary, unusual or non-recurring items of gain or revenue, in each case relating to the case commenced by the Company by its filing, on September 14, 2003, of a voluntary petition for relief under Chapter 11 of the United States Bankruptcy Code with the United States Bankruptcy Court for the District of Delaware, shall be excluded.

(U)“Continuing Directors” means, as of any date of determination, any member of the Board of Directors of the Company who:

(1)was a member of such Board of Directors on the original issue date of the Securities of Series No. 1 or was designated to the Board of Directors pursuant to the Plan of Reorganization; or

(2)was nominated for election or elected to such Board of Directors with the approval of a majority of the Continuing Directors who were members of such Board at the time of such nomination or election.

(V)“Cornerstone” means CornerNorth LLC and its Subsidiaries.

(W)“Cornerstone Note” means the note receivable related to previous intercompany obligations and payments on letters of credit and credit facility indebtedness on behalf of Cornerstone and any securities received in exchange therefor in connection with the Chapter 11 proceeding of Cornerstone Partners LP.

(X)“Credit Facilities” means one or more debt facilities or commercial paper facilities, in each case with banks or other institutional lenders providing for revolving credit loans, term loans, letters of credit or Permitted Receivables Transactions, in each case, as amended, restated, modified, renewed, refunded, replaced or refinanced (whether upon or after termination or otherwise, including by means of sale of debt securities to institutional investors) in whole or in part from time to time, and includes any securities issued in order to secure any amounts outstanding under a Credit Facility from time to time; provided that the obligation of the Company to make any payment on any such securities shall be:

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(1)no greater than the amount required to be paid under such Credit Facility that is secured by such payment obligation;

(2)payable no earlier than such amount is required to be paid under such Credit Facility; and

(3)deemed to have been paid or otherwise satisfied and discharged to the extent that the Company has paid such amount under such Credit Facility;

provided, further, that any amounts the Company is obligated to pay under such securities will not be included for purposes of determining the aggregate amount outstanding under Credit Facilities that is permitted under Section 6(B)(2)(a) (“Covenants—Incurrence of Indebtedness and Issuance of Preferred Stock”).

(Y)“Default” means any event that is, or with the passage of time or the giving of notice or both would be, an Event of Default as defined in the Indenture.

(Z)“Disqualified Stock” means any Capital Stock that, by its terms (or by the terms of any security into which it is convertible, or for which it is exchangeable, in each case at the option of the holder of the Capital Stock), or upon the happening of any event (other than as a result of an exercise of an optional redemption right by an owner), matures or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or redeemable at the option of the holder of the Capital Stock, in whole or in part, on or prior to the date that is 91 days after the date on which the Securities of Series No. 1 or Series No. 2 mature.  Notwithstanding the preceding sentence, any Capital Stock that would constitute Disqualified Stock solely because the holders of the Capital Stock have the right to require the Company to repurchase such Capital Stock upon the occurrence of a change of control or an asset sale will not constitute Disqualified Stock if the terms of such Capital Stock provide that the Company may not repurchase or redeem any such Capital Stock pursuant to such provisions unless such repurchase or redemption complies with Section 6(A) (“Covenants—Restricted Payments”).

(AA)“Equity Interests” means Capital Stock and all warrants, options or other rights to acquire Capital Stock (but excluding any debt security that is convertible into, or exchangeable for, Capital Stock).

(BB)“Equity Offering” means an offer and sale of Equity Interests of the Company pursuant to (1) a public offering or (2) a private placement.

(CC)“Event of Default” means an Event of Default as defined in the Indenture.

(DD)“Excess Cash Flow” means, with respect to any specified Person for any period, the Consolidated Cash Flow of such Person for such period, minus

(1)the items delineated in paragraphs (2) and (3) of the definition of Consolidated Cash Flow, to the extent such items were actually paid in cash; minus

(2)capital expenditures of such Person and its Restricted Subsidiaries for such period,

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in each case, on a consolidated basis, determined in accordance with GAAP.

(EE)“Excluded Assets” means assets or properties of, and Equity Interests in the Excluded Subsidiaries, Colstrip IV, Montana Megawatts and the Cornerstone Note.

(FF)Excluded Project Subsidiary” means (1) any Subsidiary of the Company engaged in the development, acquisition, design, engineering, construction, operation, ownership, servicing or management of the Southwest transmission project or (2) any subsidiary of the Company that purchases, acquires, operates and owns Colstrip IV and (3) Montana Megawatts.

(GG)“Existing Indebtedness” means all Indebtedness of the Company and its Subsidiaries (other than Indebtedness under a Credit Facility) in existence on the original issue date of the Securities of Series No. 1, until such amounts are repaid.

(HH)“Excluded Subsidiary” means Blue Dot Services Inc. and its subsidiaries, Netexit, Inc. (f/k/a Expanets, Inc.) and its subsidiaries, Cornerstone and its subsidiaries or an Excluded Project Subsidiary.

(II)“Fair Market Value” means the value that would be paid by a willing buyer to an unaffiliated willing seller in a transaction not involving distress or necessity of either party, (1) determined in good faith by an officer of NorthWestern and evidenced by an Officers’ Certificate delivered to the trustee, if such value is less than or equal to $35.0 million, or (2) determined in good faith by the Board of Directors of the Company and evidenced by a resolution delivered to the trustee, if such value is greater than $35.0 million, provided however, that for the purposes of the covenants described under section 6(G) (“Covenants- Transactions with Affiliates,” and except as expressly provided in the indenture with respect thereto) such value is to be determined solely by the Board of Directors.

(JJ)“Fixed Charges” means, with respect to any specified Person for any period, the sum, without duplication, of:

(1)the consolidated interest expense of such Person and its Restricted Subsidiaries for such period, whether paid or accrued, including, without limitation, amortization of debt issuance costs and original issue discount, non-cash interest payments, the interest component of any deferred payment obligations, the interest component of all payments associated with Capital Lease Obligations, imputed interest with respect to Attributable Debt, commissions, discounts and other fees and charges incurred in respect of letter of credit or bankers’ acceptance financings, and net of the effect of all payments made or received pursuant to Hedging Obligations in respect of interest rates; plus

(2)the consolidated interest of such Person and its Restricted Subsidiaries that was capitalized during such period; plus

(3)any interest expense on Indebtedness of another Person that is guaranteed by such Person or one of its Restricted Subsidiaries or secured by a Lien on assets of such Person or one of its Restricted Subsidiaries, whether or not such guarantee or Lien is called upon; plus

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(4)the product of (a) all dividends, whether paid or accrued and whether or not in cash, on any series of preferred stock of such Person or any of its Restricted Subsidiaries, other than dividends on Equity Interests payable solely in Equity Interests of the Company (other than Disqualified Stock) or to the Company or a Restricted Subsidiary of the Company, times (b) (i) in the case of trust preferred dividend payments, one and (ii) in the case of all other preferred dividend payments, a fraction, the numerator of which is one and the denominator of which is one minus the then current combined federal, state and local statutory tax rate of such Person, expressed as a decimal, in each case, on a consolidated basis and in accordance with GAAP; minus

(5)the upfront costs of Hedging Obligations paid prior to the date of the Indenture.

(KK)“Fixed Charge Coverage Ratio” means with respect to any specified Person for any period, the ratio of the Consolidated Cash Flow of such Person and its Restricted Subsidiaries for such period to the Fixed Charges of such Person and its Restricted Subsidiaries for such period.  In the event that the specified Person or any of its Restricted Subsidiaries incurs, assumes, guarantees, repays, repurchases, redeems, defeases or otherwise discharges any Indebtedness (other than ordinary working capital borrowings) or issues, repurchases or redeems preferred stock subsequent to the commencement of the period for which the Fixed Charge Coverage Ratio is being calculated and on or prior to the date on which the event for which the calculation of the Fixed Charge Coverage Ratio is made (the “Calculation Date”), then the Fixed Charge Coverage Ratio will be calculated giving pro forma effect to such incurrence, assumption, guarantee, repayment, repurchase, redemption, defeasance or other discharge of Indebtedness, or such issuance, repurchase, redemption, defeasance or other discharge of preferred stock, and the use of the proceeds therefrom as if the same had occurred at the beginning of the applicable four-quarter reference period.

In addition, for purposes of calculating the Fixed Charge Coverage Ratio:

(1)acquisitions that have been made by the specified Person or any of its Restricted Subsidiaries, including through mergers, consolidations or otherwise or any Person or any of its Restricted Subsidiaries acquired by the specified Person or any of its Restricted Subsidiaries and including any related financing transactions and including increases in ownership of Restricted Subsidiaries, during the four-quarter reference period or subsequent to such reference period and on or prior to the Calculation Date will be given pro forma effect (in accordance with Regulation S-X under the Securities Act, but including all pro forma adjustments permissible in accordance with the last paragraph of this definition) as if they had occurred on the first day of the four-quarter reference period and Consolidated Cash Flow for such reference period shall be calculated on the same pro forma basis ; and

(2)the Consolidated Cash Flow attributable to discontinued operations, as determined in accordance with GAAP, and operations or businesses (and ownership interests therein) disposed of prior to the Calculation Date, will be excluded; and

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(3)the Fixed Charges attributable to discontinued operations, as determined in accordance with GAAP, and operations or businesses (and ownership interests therein) disposed of prior to the Calculation Date, will be excluded, but only to the extent that the obligations giving rise to such Fixed Charges will not be obligations of the specified Person or any of its Restricted Subsidiaries following the Calculation Date; and

(4)any Person that is a Restricted Subsidiary on the Calculation Date will be deemed to have been a Restricted Subsidiary at all times during such four-quarter period;

(5)any Person that is not a Restricted Subsidiary on the Calculation Date will be deemed not to have been a Restricted Subsidiary at any time during such four-quarter period; and

(6)if any Indebtedness bears a floating rate of interest, the interest expense on such Indebtedness will be calculated as if the rate in effect on the Calculation Date had been the applicable rate for the entire period (taking into account any Hedging Obligation applicable to such Indebtedness if such Hedging Obligation has a remaining term at the Calculation Date in excess of 12 months).

For purposes of this definition, whenever pro forma effect is to be given to an acquisition or investment, the amount of income or earnings relating thereto and the amount of Fixed Charges associated with any Indebtedness incurred in connection therewith, the pro forma calculations shall be determined in good faith by a responsible financial or accounting officer of the Company.  Any such pro forma calculations may include operating expense reductions for such period resulting from the acquisition which is being given pro forma effect that would be permitted pursuant to Article 11 of Regulation S-X under the Securities Act.

(LL)“GAAP” means generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other entity as have been approved by a significant segment of the accounting profession, which are in effect from time to time.

(MM)“Guarantee” means a guarantee other than by endorsement of negotiable instruments for collection in the ordinary course of business, direct or indirect, in any manner, including, without limitation, by way of a pledge of assets or through letters of credit or reimbursement agreements in respect thereof, of all or any part of any Indebtedness (whether arising by virtue of partnership arrangements, or by agreements to keep-well, to purchase assets, goods, securities or services, to take or pay or to maintain financial statement conditions or otherwise).

(NN)“Hedging Obligations” means, with respect to any specified Person, the obligations of such Person incurred in the normal course of business and not for speculative purposes under:

(1)interest rate swap agreements (whether from fixed to floating or floating to fixed), interest rate cap agreements, interest rate collar agreements or

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other similar agreements, and other agreements designed to manage interest rates or interest rate risk;

(2)foreign exchange contracts or currency protection agreements, in each case entered into with one of more financial institutions; and other agreements or arrangements designed to protect such Person against fluctuations in currency exchange rates; and

(3)any commodity futures contract, commodity option or other similar agreement or arrangement, in each case designed to protect against fluctuations in the price of commodities used by that entity at the time; and other agreements or arrangements designed to protect such Person against fluctuation in commodity prices.

(OO)“Indebtedness” means, with respect to any specified Person, any indebtedness of such Person (excluding accrued expenses and trade payables), whether or not contingent:

(1)in respect of borrowed money;

(2)evidenced by bonds, notes, debentures or similar instruments or letters of credit (or reimbursement agreements in respect thereof);

(3)in respect of banker’s acceptances;

(4)representing Capital Lease Obligations;

(5)representing the balance deferred and unpaid of the purchase price of any property, except any such balance that constitutes an accrued expense or trade payable; or

(6)representing the net amount owing under any Hedging Obligations,

if and to the extent any of the preceding items (other than letters of credit and Hedging Obligations) would appear as a liability upon a balance sheet of the specified Person prepared in accordance with GAAP.  In addition, the term “Indebtedness” includes all Indebtedness of others secured by a Lien on any asset of the specified Person (whether or not such Indebtedness is assumed by the specified Person) and, to the extent not otherwise included, the Guarantee by the specified Person of any indebtedness of any other Person.

The amount of any Indebtedness outstanding as of any date will be:

(1)the accreted value of the Indebtedness, in the case of any Indebtedness issued with original issue discount;

(2)the principal amount of the Indebtedness, in the case of any other Indebtedness; and

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(3)in respect of Indebtedness of another Person that is secured by a Lien on the assets of the specified Person (and which the specified Person is not directly or indirectly liable to pay as guarantor or otherwise), the lesser of:

(a)the Fair Market Value of such asset at the date of determination, and

(b)the amount of the Indebtedness of the other Person.

(PP)“Investment Grade Rating” means a rating equal to or higher than Baa3 (or the equivalent) by Moody’s or BBB– (or the equivalent) by S&P.

(QQ)“Investments” means, with respect to any Person, all direct or indirect investments by such Person in other Persons (including Affiliates) in the forms of loans (including Guarantees or other obligations), advances or capital contributions (excluding commission, travel and similar advances to officers and employees made in the ordinary course of business), purchases or other acquisitions for consideration of Indebtedness, Equity Interests or other securities, together with all items that are or would be classified as investments on a balance sheet prepared in accordance with GAAP.  If the Company or any Subsidiary of the Company sells or otherwise disposes of any Equity Interests of any direct or indirect Subsidiary of the Company such that, after giving effect to any such sale or disposition, such Person is no longer a Subsidiary of the Company, the Company will be deemed to have made an Investment on the date of any such sale or disposition equal to the Fair Market Value of the Equity Interests of such Subsidiary not sold or disposed of in an amount determined as provided in the final paragraph of Section 6(A) (“Covenants—Restricted Payments”).  The acquisition by the Company or any Subsidiary of the Company of a Person that holds an Investment in a third Person will be deemed to be an Investment by the Company or such Subsidiary in such third Person in an amount equal to the Fair Market Value of the Investment held by the acquired Person in such third Person in an amount determined as provided in the final paragraph Section 6(A) (“Covenants—Restricted Payments”).  Except as otherwise provided in the Indenture, the amount of an Investment will be its Fair Market Value at the time the Investment is made and without giving effect to subsequent changes in value.

(RR)“Lien” means, with respect to any asset, any mortgage, deed of trust, pledge, security interest, encumbrance, easement, lease, reservation, restriction, servitude, charge or similar right and any other lien of any kind, whether or not filed, recorded or otherwise perfected under applicable law, including, without limitation, any conditional sale or other title retention agreement, any lease in the nature thereof and any option or other agreement to sell or give a security interest in and any filing of or agreement to give any financing statement under the Uniform Commercial Code (or equivalent statutes) of any jurisdiction.

(SS)“Montana Megawatts” means NorthWestern Generation I, LLC, and all assets owned directly or indirectly by it, including, without limitation all of the equity interests in Montana Megawatts I, LLC and certain other permits, assets and contractual rights to be used in the operation of the Montana Megawatts facility, a planned 260-megawatt, natural gas-fired, combined-cycle electric generation facility under construction near Great Falls, Montana.

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(TT)“Moody’s” means Moody’s Investors Service, Inc. or any successor to the rating agency business thereof.

(UU)“Net Income” means, with respect to any specified Person, the net income (loss) of such Person, determined in accordance with GAAP and before any reduction in respect of preferred stock dividends or accretion, excluding, however:

(1)any gain (but not loss), together with any related provision for taxes on such gain (but not loss), realized in connection with:  (a) any Asset Sale (without giving effect to the threshold provided for in the definition thereof); or (b) the disposition of any securities by such Person or any of its Subsidiaries or the extinguishment of any Indebtedness of such Person or any of its Subsidiaries; and

(2)any extraordinary gain (but not loss), together with any related provision for taxes on such extraordinary gain (but not loss).

(VV)“Net Proceeds” means the aggregate cash proceeds received by the Company or any of its Restricted Subsidiaries in respect of any Asset Sale (including, without limitation, any cash received upon the sale or other disposition of any non-cash consideration received in any Asset Sale), net of the direct costs relating to such Asset Sale, including, without limitation, legal, accounting and investment banking fees, and sales commissions, and any relocation expenses incurred as a result of the Asset Sale, taxes paid or payable as a result of the Asset Sale, in each case, after taking into account any available tax credits or deductions and any tax sharing arrangements (but not taking into account any net operating losses available to the Company or any of its Restricted Subsidiaries), the net present value of any amounts required to be returned to rate payers in the form of rate reductions or as otherwise required by any Governmental Authority, and amounts required to be applied to the repayment of Indebtedness and any reserve for adjustment in respect of the sale price of such asset or assets established in accordance with GAAP.

(WW)“Non-Recourse Debt” means Indebtedness:

(1)as to which neither the Company nor any of its Restricted Subsidiaries (a) provides credit support of any kind (including any undertaking, agreement or instrument that would constitute Indebtedness), (b) is directly or indirectly liable as a guarantor or otherwise, or (c) constitutes the lender;

(2)no default with respect to which would permit upon notice, lapse of time or both any holder of any other Indebtedness (other than the Securities of Series No. 1 or Series No. 2 or the Senior Secured Debt) of the Company or any of its Restricted Subsidiaries to declare a default on such other Indebtedness or cause the payment of the Indebtedness to be accelerated or payable prior to its stated maturity; and

(3)in the case of any such Indebtedness incurred after the original issue date of the Securities of Series No. 1, as to which the lenders have been notified in writing that they will not have any recourse to the stock or assets of the Company or any of its Restricted Subsidiaries (other than any Excluded Assets).

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(XX)“Obligations” means any principal, interest, penalties, fees, indemnifications, reimbursements, damages and other liabilities payable under the documentation governing any Indebtedness.

(YY)“Originators” means NorthWestern and/or any of its Restricted Subsidiaries in their respective capacities as parties to any Receivables Purchase Documents, as sellers or transferors of any Receivables and Related Security in connection with a Permitted Receivables Transaction.

(ZZ)“Permitted Business” means any business substantially similar to the lines of business conducted by the Company and its Restricted Subsidiaries as of the date of the indenture or any business or activity that is reasonably related, ancillary or complementary thereto or a reasonable extension, development or expansion thereof.

(AAA)“Permitted Investments” means:

(1)any Investment in the Company or in a Restricted Subsidiary of the Company;

(2)any Investment in Cash Equivalents;

(3)any Investment by the Company or any Restricted Subsidiary of the Company in a Person, if as a result of such Investment:

(a)such Person becomes a Restricted Subsidiary of the Company; or

(b)such Person is merged, consolidated or amalgamated with or into, or transfers or conveys substantially all of its assets to, or is liquidated into, the Company or a Restricted Subsidiary of the Company;

(4)any Investment made as a result of the receipt of non-cash consideration from an Asset Sale that was made pursuant to and in compliance with Section 4 of this Article (“Offer to Purchase by Application of Excess Proceeds”) and Section 6(E) of this Article (“Covenants—Asset Sales”);

(5)any Investments made in exchange for the issuance of Equity Interests (other than Disqualified Stock) of the Company;

(6)any Investments received in compromise or resolution of (a) obligations of trade creditors or customers that were incurred in the ordinary course of business of the Company or any of its Restricted Subsidiaries, including pursuant to any plan of reorganization or similar arrangement upon the bankruptcy or insolvency of any trade creditor or customer; or (b) litigation, arbitration or other disputes with Persons who are not Affiliates;

(7)Investments represented by Hedging Obligations;

(8)Investments by the Company or a Restricted Subsidiary in a Receivables SPV or any Investment by a Receivables SPV in any other Person, in each case, in connection with a Permitted Receivables Transaction;

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(9)any Investment, including Investments in Unrestricted Subsidiaries, existing on the date of the Indenture;

(10)Investments in the form of, or pursuant to, operating agreements, joint ventures, partnership agreements, working interests, royalty interests, mineral leases, processing agreements, farm-out agreements, contracts for the sale, transportation or exchange of oil and natural gas, unitization agreements, pooling agreements, area of mutual interest agreements, production sharing agreements or other similar or customary agreements, transactions, properties, interests or arrangements, and Investments and expenditures in connection therewith or pursuant thereto, in each case, made or entered into in the ordinary course of business;

(11)Investments in Affiliates of the Company resulting from the drawings under, or renewals or extensions of surety bonds, guarantees, or performance bonds supporting obligations of such Affiliates, and Investments in Subsidiaries of the Company to cash collateralize obligations supported by such letters of credit, bonds or guarantees if they expire or are cancelled undrawn to be made by the Company or any of its Subsidiaries in order to avoid a default pursuant to contracts or agreements;

(12)issuances of letters of credit for working capital requirements and general corporate purposes of the Excluded Subsidiaries, Montana Megawatts, and Colstrip IV in an aggregate principal amount at any one time outstanding not to exceed $60.0 million;

(13)loans or advances to employees made in the ordinary employees made in the ordinary course of business in an aggregate principal amount not to exceed $5.0 million at any one time outstanding;

(14)repurchases of the Securities of Series No. 1 and Series No. 2 or other Senior Secured Debt;

(15)negotiable instruments held for deposits or collection in the ordinary course of business;

(16)receivables owing to the Company or any Restricted Subsidiary of the Company created or acquired in the ordinary course of business and payable or dischargeable in accordance with customary trade terms; provided, however, that such trade terms may include such concessionary trade terms as the Company or any such Restricted Subsidiary of the Company deems reasonable under the circumstances;

(17)payroll, travel and similar advances to cover matters that are expected at the time of such advances ultimately to be treated as expenses for accounting purposes and that and that are made in the ordinary course of business;

(18)Investments resulting from the acquisition of a Person that at the time of such acquisition held instruments constituting Investments that were not acquired in contemplation of the acquisition of such Person;

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(19)Investments in the Excluded Assets;

(20)any Investment made since the date of the indenture in Persons engaged primarily in Permitted Businesses, if after giving effect to such Investment, such Person is or will become a Restricted Subsidiary of the Company; provided that the aggregate Fair Market Value of Investments made pursuant to this clause (20) (measured on the date each such Investment was made and without giving effect to subsequent change in value), when taken together with all other Investments made pursuant to this clause (20) that are at the time outstanding, does not exceed 10% of the consolidated assets of the Company and its Restricted Subsidiaries as of the most recent fiscal quarter end for which financial statements are publicly available; and

(21)other Investments made since the date of the Indenture in any Person that is not also a Restricted Subsidiary of the Company having an aggregate Fair Market Value (measured on the date each such Investment was made and without giving effect to subsequent changes in value), when taken together with all other Investments made pursuant to this clause (21), that are at the time outstanding, not to exceed $35.0 million; provided, however, that if any Investment pursuant to this clause (21) is made in any Person that is not a Restricted Subsidiary of the Company at the date of the making of the Investment and such Person becomes a Restricted Subsidiary after such date, such Investment shall thereafter be deemed to have been made pursuant to clause (1) above, and shall cease to have been made pursuant to this clause (21).

(BBB)“Permitted Liens” means:

(1)Liens securing any Senior Secured Debt, including the notes and any Indebtedness under a Credit Facility that was permitted by the terms of the Indenture to be incurred, and all Obligations and Hedging Obligations relating to such Indebtedness;

(2)Liens on property of a Person existing at the time such Person is merged with or into or consolidated with the Company or any Restricted Subsidiary of the Company; provided that such Liens were in existence prior to the contemplation of such merger or consolidation and do not extend to any assets other than those of the Person merged into or consolidated with the Company or the Restricted Subsidiary;

(3)Liens on property (including Capital Stock) existing at the time of acquisition of the property by the Company or any Restricted Subsidiary of the Company; provided that such Liens were in existence prior to such acquisition and not incurred in contemplation of such acquisition;

(4)Liens imposed by law, such as workmen’s carriers’ and mechanics’ liens, or to secure the performance of statutory or regulatory obligations, surety or appeal bonds, performance bonds or other obligations of a like nature, in each case, incurred in the ordinary course of business;

(5)Liens to secure Indebtedness (including Capital Lease Obligations) permitted by Section 6(B)(2)(d) (under the heading “Incurrence of

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Indebtedness and Issuance of Preferred Stock”) covering only the assets acquired with such Indebtedness;

(6)Liens existing on the original issue date of the Securities of Series No. 1 (including the Liens of the Mortgages and the Lien of the Indenture);

(7)Liens for taxes, assessments or governmental charges or claims that are not yet delinquent or that are being contested in good faith by appropriate proceedings promptly instituted and diligently concluded; provided that any reserve or other appropriate provision as is required in conformity with GAAP has been made therefor;

(8)survey exceptions, easements or reservations of, or rights of others for, licenses, rights of way, sewers, electric lines, telegraph and telephone lines and other similar purposes, or zoning or other restrictions as to the use of real property that were not incurred in connection with the Indebtedness and that do not in the aggregate materially adversely affect the value of said properties or materially impair their use in the operation of the business of such Person;

(9)Liens incurred or deposits made in the ordinary course of business in connection with workers’ compensation, unemployment insurance and other types of social security;

(10)Liens encumbering deposits made to secure obligations arising from statutory, regulatory, contractual or warranty requirements of the Company or any of its Restricted Subsidiaries, including rights of offset and set-off;

(11)leases and subleases granted to others as lessee or sublessee that do not materially interfere with the ordinary course of business of the Company and its Restricted Subsidiaries;

(12)Liens incurred in the ordinary course of business of the Company or any Restricted Subsidiary, including Liens to secure obligations with respect to (i) contracts (other than for Indebtedness) for commercial and trading activities in the ordinary course of business for the purchase, transmission, distribution, sale, lease or hedge of any energy related commodity or service, (ii) agreements relating to Hedging Obligations or netting agreements representing commodity price contracts or derivatives or (iii) agreements relating to Hedging Obligations entered into with qualified counterparties representing interest rate swaps or derivatives; provided, however,  that such Liens do not exceed $20.0 million in the aggregate at any one time outstanding;

(13)Liens arising from Uniform Commercial Code financing statements filed on a precautionary basis in respect of operating leases intended by the parties in good faith to be true leases (other than any such leases entered into in violation of the Indenture);

(14)Liens in favor of the Company or on Excluded Assets;

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(15)Liens to secure Indebtedness permitted by clauses (g), (n) or (r) of Section 6(B)(2) of this Article (“Incurrence of Indebtedness and Issuance of Preferred Stock”);

(16)Liens securing Permitted Refinancing Indebtedness; provided that any such Lien is limited to all or part of the same property or assets (plus improvements, accessions, proceeds or dividends or distributions in respect thereof) that secured (or, under the written arrangements under which the original Lien arose, could secure) the Indebtedness being refinanced or is in respect of property that is the security for a Permitted Lien hereunder;

(17)Liens on Receivables transferred to a Receivables SPV or on assets of a Receivables SPV, in either case, incurred in connection with a Permitted Receivables Transaction; and

(18)Liens, including pledges, rights of offset and bankers’ liens, on deposit accounts, instruments, investment accounts and investment property (including cash, cash equivalents and marketable securities) from time to time maintained with or held by any financial and/or depository institutions, in each case solely to secure any and all obligations now or hereafter existing of the Company or any of its Subsidiaries in connection with any deposit account, investment account or cash management service (including ACH, Fedwire, CHIPS, concentration and zero balance accounts, and controlled disbursement, lockbox or restricted accounts) now or hereafter provided by any financial and/or depository institutions to or for the benefit of the Company or any of its Restricted Subsidiaries.

(CCC)“Permitted Refinancing Indebtedness” means any Indebtedness of the Company or any of its Restricted Subsidiaries issued in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease, refund or discharge other Indebtedness of the Company or any of its Restricted Subsidiaries (other than intercompany Indebtedness and Non-Recourse Debt of any Excluded Project Subsidiary); provided that:

(1)the principal amount (or accreted value, if applicable) of such Permitted Refinancing Indebtedness does not exceed the principal amount (or accreted value, if applicable) of the Indebtedness extended, refinanced, renewed, replaced, defeased, refunded or discharged (plus all accrued and unpaid interest on the Indebtedness and the amount of all expenses and premiums incurred in connection therewith);

(2)such Permitted Refinancing Indebtedness has a final maturity date later than the final maturity date of, and has a Weighted Average Life to Maturity equal to or greater than the Weighted Average Life to Maturity of, the Indebtedness being extended, refinanced, renewed, replaced, defeased, refunded or discharged;

(3)if the Indebtedness being extended, refinanced, renewed, replaced, defeased, discharged or refunded is Subordinated Indebtedness, such Permitted Refinancing Indebtedness is Subordinated Indebtedness that is subordinated in right of payment to, the Securities of Series No. 1 or Series No. 2

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on terms at least as favorable to the holders of Securities of Series No. 1 or Series No. 2 as those contained in the documentation governing the Indebtedness being extended, refinanced, renewed, replaced, defeased, refunded or discharged; and

(4)such Indebtedness is incurred either by the Company or by the Restricted Subsidiary who is the obligor on the Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded.

(DDD)“Permitted Receivables Transaction” means (i) a sale or other transfer by an Originator to a Receivables SPV or any other Person of Receivables and Related Security for fair market value and without recourse (except for limited recourse typical of such structured finance transactions), and/or (ii) a sale or other transfer by an Originator or a Receivables SPV to (a) purchasers of or other investors in such Receivables and Related Security or (b) any other Person (including a Receivables SPV) in a transaction in which purchasers or other investors purchase or are otherwise transferred such Receivables and Related Security in each case pursuant to and in accordance with the terms of the Receivables Purchase Documents; provided, that Receivables Facility Attributed Indebtedness incurred in connection with the Receivables Purchase Documents does not exceed $70,000,000 in the aggregate at any time.

(EEE)“Person” means any individual, corporation, partnership, joint venture, association, joint-stock company, trust, unincorporated organization, limited liability company or government or other entity.

(FFF)“Plan of Reorganization” means the Company’s Second Amended and Restated Plan of Reorganization, dated August 18, 2004, under Chapter 11 of the Bankruptcy Code (as amended from time to time).

(GGG)“Rating Agencies” means S&P and Moody’s, or if S&P or Moody’s or both shall not make a rating on the Securities of Series No. 1 or Series No. 2 publicly available, a nationally recognized statistical rating agency or agencies, as the case may be, selected by the Company (as certified by a resolution of its Board of Directors) which shall be substituted for S&P or Moody’s or both, as the case may be.

(HHH)“Receivable(s)” means all of the applicable Originator’s or Receivables SPV’s presently existing and hereafter arising or acquired accounts, accounts receivable, and all present and future rights of such Originator or Receivables SPV to payment for goods sold or leased or for services rendered (except those evidenced by instruments or chattel paper), whether or not they have been earned by performance, and all rights in any merchandise or goods which any of the same may represent, and all rights, title, security and guaranties with respect to each of the foregoing, including, without limitation, any right of stoppage in transit.

(III)“Receivables and Related Security” means the Receivables and the related security and collections with respect thereto which are sold or transferred by any Originator or Receivables SPV in connection with any Permitted Receivables Transaction.

(JJJ)“Receivables Facility Attributed Indebtedness” means the amount of obligations outstanding under a receivables purchase facility on any date of determination

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that would be characterized as principal if such facility were structured as a secured lending transaction rather than as a purchase.

(KKK)“Receivables Purchase Documents” means any series of receivables purchase or sale agreements generally consistent with terms contained in comparable structured finance transactions pursuant to which an Originator or Originators sell or transfer to Receivables SPVs all of their respective right, title and interest in and to certain Receivables and Related Security for further sale or transfer to other purchasers of or investors in such assets (and the other documents, instruments and agreements executed in connection therewith), as any such agreements may be amended, restated, supplemented or otherwise modified from time to time, or any replacement or substitution therefor.

(LLL)“Receivables SPV” means any special purpose entity established for the purpose of purchasing receivables in connection with a receivables securitization transaction permitted under the terms of the indenture.

(MMM)“Restricted Investment” means an Investment other than a Permitted Investment.

(NNN)“Restricted Subsidiary” of a Person means any Subsidiary of the specified Person that is not an Unrestricted Subsidiary.

(OOO)“Senior Secured Debt” means any of the Company’s Indebtedness under the Montana Mortgage, the South Dakota Mortgage, the Indenture, and any other Indebtedness to the extent such Indebtedness is secured by any of the foregoing, including Indebtedness under the Credit Facilities.

(PPP)“S&P” means Standard & Poor’s Rating Group, Inc., or any successor to the rating agency business thereof.

(QQQ)“Stated Maturity” means, with respect to any installment of interest or principal on any series of Indebtedness, the date on which the payment of interest or principal was scheduled to be paid in the original documentation governing such Indebtedness, and will not include any contingent obligations to repay, redeem or repurchase any such interest or principal prior to the date originally scheduled for the payment thereof.

(RRR)“Subordinated Indebtedness” means any Indebtedness of the Company or any of its Restricted Subsidiaries that is contractually subordinated to the Securities of Series No. 1 or Series No. 2, other than any such Indebtedness of a Restricted Subsidiary that is owed to the Company or a Restricted Subsidiary.

(SSS)“Subsidiary” means, with respect to any specified Person:

(1)any corporation, association or other business entity of which more than 50% of the total voting power of shares of Capital Stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees of the corporation, association or other business entity is at the time owned or controlled, directly or indirectly, by that Person or

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one or more of the other Subsidiaries of that Person (or a combination thereof); and

(2)any partnership (a) the sole general partner or the managing general partner of which is such Person or a Subsidiary of such Person or (b) the only general partners of which are that Person or one or more Subsidiaries of that Person (or any combination thereof).

(TTT)“Unrestricted Subsidiary” means any Subsidiary of the Company that is designated by the Board of Directors as an Unrestricted Subsidiary pursuant to a Board Resolution, but only to the extent that such Subsidiary:

(1)has no Indebtedness other than Non-Recourse Debt;

(2)except as permitted pursuant to the covenant described in Section 6(G) above (“Covenants—Transactions with Affiliates”) is not party to any agreement, contract, arrangement or understanding with the Company or any Restricted Subsidiary of the Company unless the terms of any such agreement, contract, arrangement or understanding are no less favorable to the Company or such Restricted Subsidiary than those that might be obtained at the time from Persons who are not Affiliates of the Company;

(3)is a Person with respect to which neither the Company nor any of its Restricted Subsidiaries has any direct or indirect obligation (a) to subscribe for additional Equity Interests or (b) to maintain or preserve such Person’s financial condition or to cause such Person to achieve any specified levels of operating results; and

(4)has not guaranteed or otherwise directly or indirectly provided credit support for any Indebtedness of the Company or any of its Restricted Subsidiaries.

Notwithstanding the foregoing, the Excluded Subsidiaries shall be deemed to be Unrestricted Subsidiaries, unless the Company designates one or more of them as Restricted Subsidiaries in accordance with the terms set forth in the indenture.

Except for the Excluded Subsidiaries, any designation of a Subsidiary of the Company as an Unrestricted Subsidiary after the date of the Indenture will be evidenced to the trustee by filing with the trustee a certified copy of the Board Resolution giving effect to such designation and an officer’s certificate certifying that such designation complied with the preceding conditions and was permitted by the covenant described in Section 6(A) above (“Covenants—Restricted Payments”).  Except for the Excluded Subsidiaries, if at any time, any Unrestricted Subsidiary would fail to meet the preceding requirements as an Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of the Indenture and any Indebtedness of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Company as of such date and, if such Indebtedness is not permitted to be incurred as of such date under Section 6(B) (“Covenants—Incurrence of Indebtedness and Issuance of Preferred Stock”), the Company will be in default of such covenant.

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(UUU)“Voting Stock” of any Person as of any date means the Capital Stock of such Person that is at the time entitled to vote in the election of the Board of Directors of such Person.

(VVV)“Weighted Average Life to Maturity” means, when applied to any Indebtedness at any date, the number of years obtained by dividing:

(1)the sum of the products obtained by multiplying (a) the amount of each then remaining installment, sinking fund, serial maturity or other required payments of principal, including payment at final maturity, in respect of the Indebtedness, by (b) the number of years (calculated to the nearest one-twelfth) that will elapse between such date and the making of such payment; by

(2)the then outstanding principal amount of such Indebtedness.

(WWW)  "Wholly-Owned Subsidiary” of any specified Person means a Subsidiary of such Person all of the outstanding Capital Stock or other ownership interests of which (other than directors’ qualifying shares or foreign national qualifying Capital Stock or other ownership interests) will at the time be owned by such Person or by one or more wholly-owned Restricted Subsidiaries of such Person.

SECTION 8.Events of Default

So long as any Securities of Series No. 1 or Series No. 2 shall remain Outstanding, the occurrence of any of the following events shall be an additional Event of Default under the Indenture:

(A)a default under any instrument or instruments under which there may be issued or by which there may be secured or evidenced any Indebtedness for money borrowed by the Company or any of its Restricted Subsidiaries having an outstanding principal amount of $50 million or more, if such default:

(1)results from failure to pay principal of, or interest or premium, if any, on such indebtedness when due or if applicable, prior to the expiration of the grace period provided in such Indebtedness (a “Payment Default”); or

(2)results in the acceleration of such Indebtedness prior to its stated maturity;

provided that, in each case, if such default shall be remedied or cured by the Company or such Restricted Subsidiary or waived by the holder of such Indebtedness, in each case before acceleration of the Securities of such series, then the Event of Default hereunder caused by reason thereof shall be deemed likewise to have been remedied, cured or waived without further action on the part of the Trustee, any Holder of Securities of such Series or any other Person; or

(B)any final judgment or order for the payment of money shall be rendered by a court or courts of competent jurisdiction against the Company or any Restricted Subsidiary of the Company, in an amount in excess of $50 million (excluding therefrom any amount covered by any third-party indemnity or insurance as to which the indemnitor or the insurer, as the case may be,  has acknowledged in writing its coverage obligation), and such judgment or order shall not be paid or discharged for a period of 60 consecutive

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days, during which period a stay of enforcement of such final judgment or order, or an order vacating such judgment or order, by reason of a pending appeal or otherwise, shall not be in effect.

SECTION 9.Book-entry; Delivery and Form.

(A)Form and Dating.

The Securities of Series No. 1 and Series No. 2 and the Trustee’s certificate of authentication shall be substantially in the form of Exhibit A or Exhibit D hereto, as applicable.  Such Securities may have notations, legends or endorsements required by law, stock exchange rule or usage.  Each such Security shall be dated the date of its authentication.  Such Securities shall be in denominations of $1,000 and integral multiples thereof.

The terms and provisions contained in the Securities of Series No. 1 and Series No. 2 shall constitute, and are hereby expressly made, a part of this Supplemental Indenture, and the Company, by its execution and delivery of this Supplemental Indenture, expressly agrees to such terms and provisions and to be bound thereby.  However, to the extent any provision of any Security of Series No. 1 or Series No. 2 conflicts with the express provisions of this Supplemental Indenture or the Indenture, the provisions of this Supplemental Indenture or the Indenture, as applicable, shall govern and be controlling.

Securities of Series No. 1 and Series No. 2 issued in global form shall be substantially in the form of Exhibits A or D attached hereto, as applicable (including the Global Security Legend and the “Schedule of Exchanges in the Global Security” attached thereto).  Securities of Series No. 1 and Series No. 2 issued in definitive form shall be substantially in the form of Exhibit A or D attached hereto, as applicable (but without the Global Security Legend and without the “Schedule of Exchanges of Interests in the Global Security” attached thereto).  Each Global Security shall represent such aggregate principal amount of the outstanding Securities of Series No. 1 and Series No. 2 as shall be specified therein and each shall provide that it shall represent the aggregate principal amount of outstanding Securities of Series No. 1 and Series No. 2 from time to time endorsed thereon and that the aggregate principal amount of outstanding Securities of Series No. 1 and Series No. 2 represented thereby may from time to time be reduced or increased, as appropriate, to reflect exchanges and redemptions.  Any endorsement of a Global Security to reflect the amount of any increase or decrease in the aggregate principal amount of outstanding Securities of Series No. 1 and Series No. 2 represented thereby shall be made by the Trustee, the Depositary or the Security Custodian, at the direction of the Trustee, in accordance with instructions given by the Holder thereof as required by Section 9(D) of this Article.

The provisions of the “Operating Procedures of the Euroclear System” and “Terms and Conditions Governing Use of Euroclear” and the “General Terms and Conditions of Clearstream Bank” and “Customer Handbook” of Clearstream shall be applicable to transfers of beneficial interests in the Regulation S Global Securities that are held by members of, or Participants, in DTC through Euroclear or Clearstream.

(B)Authentication.

The Trustee or an Authenticating Agent shall authenticate by delivery and execution of a Trustee’s Certificate of Authentication in the form set forth in Section 202 of the Indenture (1) the Securities of Series No. 1 for original issue on the Issue Date in the aggregate principal amount of $225,000,000 (the “Original Securities”), and (2) any Securities of Series No. 2 from time to time

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for issue only in exchange for a like principal amount of Securities of Series No. 1, in each case, upon a Company Order, which Company Order shall specify (x) the amount of Securities of Series No. 2 to be authenticated and the date of original issue thereof and (y) the amount of Securities of Series No. 1 and Series No. 2 to be issued in global form or definitive form.  The aggregate principal amount of Securities of Series No. 1 and Series No. 2 Outstanding at any time may not exceed $225,000,000.

(C)Security Registrar, Paying Agent and Depositary.

The Company initially appoints the Trustee to act as the Security Registrar and Paying Agent for the Securities of Series No. 1 and Series No. 2.  Upon the occurrence of, and during the continuation of, an Event of Default set forth in Sections 701(d) or 701(e) of the Indenture, the Trustee shall serve as Paying Agent for the Securities of Series No. 1 and Series No. 2.  The Company shall maintain a Place of Payment for the Securities of Series No. 1 and Series No. 2 within the City and State of New York pursuant to Section 502 of the Indenture.

The Company initially appoints The Depository Trust Company (“DTC”) to act as Depositary with respect to the Global Securities.  The Trustee has been appointed by DTC to act as Security Custodian with respect to the Global Securities.

(D)Transfer and Exchange.

(1)Transfer and Exchange of Global Securities.  A Global Security may not be transferred as a whole except by the Depositary to a nominee of the Depositary, by a nominee of the Depositary to the Depositary or to another nominee of the Depositary, or by the Depositary or any such nominee to a successor Depositary or a nominee of such successor Depositary.  All Global Securities shall be exchanged by the Company for Definitive Securities if:

(a)the Company delivers to the Trustee notice from the Depositary that it is unwilling or unable to continue to act as Depositary for the Global Securities or that it is no longer a clearing agency registered under the Exchange Act and, in either case, a successor Depositary is not appointed by the Company within 90 days after the date of such notice from the Depositary or

(b)the Company, in its sole discretion, notifies the Trustee in writing that it elects to cause issuance of the Securities of Series No. 1 and Series No. 2 in certificated form; or

(c)there has occurred and is continuing a Default or Event of Default with respect to the Securities of Series No. 1 or Series No. 2.

Upon the occurrence of either of the preceding events in (a), (b) or (c) above, Definitive Securities shall be issued in such names as the Depositary shall instruct the Trustee.  Global Securities also may be exchanged or replaced, in whole or in part, as provided in Sections 306 and 309 of the Indenture.  Every Security of Series No. 1 or Series No. 2 authenticated and delivered in exchange for, or in lieu of, a Global Security or any portion thereof, pursuant to Sections 306 and 309 of the Indenture, shall be authenticated and delivered in the form of, and shall be, a Global Security.  A Global Security may not be exchanged for

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another Security of Series No. 1 or Series No. 2 other than as provided in this Section 9(D)(1)(c), however, beneficial interests in a Global Security may be transferred and exchanged as provided in Section 9(D)(1), (3) or (6) of this Article.

(2)Transfer and Exchange of Beneficial Interests in the Global Securities.  The transfer and exchange of beneficial interests in the Global Securities shall be effected through the Depositary, in accordance with the provisions of this Supplemental Indenture and the Applicable Procedures.  Beneficial interests in the Restricted Global Securities shall be subject to restrictions on transfer comparable to those set forth herein to the extent required by the Securities Act.  Transfers of beneficial interests in the Global Securities also shall require compliance with either subparagraph (a) or (b) below, as applicable, as well as one or more of the other following subparagraphs as applicable:

(a)Transfer of Beneficial Interests in the Same Global Security.  Beneficial interests in any Restricted Global Security may be transferred to Persons who take delivery thereof in the form of a beneficial interest in the same Restricted Global Security in accordance with the transfer restrictions set forth in the Private Placement Legend; provided, however, that prior to the expiration of the Restricted Period transfers of beneficial interests in the Regulation S Global Security may not be made to a U.S. Person or for the account or benefit of a U.S. Person (other than an Initial Purchaser).  Beneficial interests in any Unrestricted Global Security may be transferred only to Persons who take delivery thereof in the form of a beneficial interest in an Unrestricted Global Security.  No written orders or instructions shall be required to be delivered to the Security Registrar to effect the transfers described in this Section 9(D)(2)(a).

(b)All Other Transfers and Exchanges of Beneficial Interests in Global Securities.  In connection with all transfers and exchanges of beneficial interests (other than a transfer of a beneficial interest in a Global Security to a Person who takes delivery thereof in the form of a beneficial interest in the same Global Security), the transferor of such beneficial interest must deliver to the Security Registrar either:

(i)both (A) a written order from a Participant or an Indirect Participant given to the Depositary in accordance with the Applicable Procedures directing the Depositary to credit or cause to be credited a beneficial interest in another Global Security in an amount equal to the beneficial interest to be transferred or exchanged and (B) instructions given in accordance with the Applicable Procedures containing information regarding the Participant account to be credited with such increase or

(ii)both (A) a written order from a Participant or an Indirect Participant given to the Depositary in accordance with the Applicable Procedures directing the Depositary to cause to

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be issued a Definitive Security in an amount equal to the beneficial interest to be transferred or exchanged and (B) instructions given by the Depositary to the Security Registrar containing information regarding the Person in whose name such Definitive Security shall be registered to effect the transfer or exchange referred to in (A) above.

Upon an Exchange Offer by the Company in accordance with Article Four, Section 9(D)(6) of this Supplemental Indenture, the requirements of this Section 9(D)(2)(a) shall be deemed to have been satisfied upon receipt by the Security Registrar of the instructions contained in the Letter of Transmittal delivered by the Holder of such beneficial interests in the Restricted Global Securities.  Upon notification from the Security Registrar that all of the requirements for transfer or exchange of beneficial interests in Global Securities contained in this Supplemental Indenture, the Securities of Series No. 1 or Series No. 2 and otherwise applicable under the Securities Act have been satisfied, the Trustee shall adjust the principal amount of the relevant Global Securities pursuant to Article Four, Section 9(D)(8) of this Supplemental Indenture.

(c)Transfer of Beneficial Interests to Another Restricted Global Security.  A beneficial interest in any Restricted Global Security may be transferred to a Person who takes delivery thereof in the form of a beneficial interest in another Restricted Global Security if the transfer complies with the requirements of clause (2) above and the Security Registrar receives the following:

(i)if the transferee shall take delivery in the form of a beneficial interest in the Rule 144A Global Security, then the transferor must deliver a certificate in the form of Exhibit B hereto, including the certifications in Item (1) thereof; or

(ii)if the transferee shall take delivery in the form of a beneficial interest in the Regulation S Global Security, then the transferor must deliver a certificate in the form of Exhibit B hereto, including the certifications in Item (2) thereof.

(d)Transfer and Exchange of Beneficial Interests in a Restricted Global Security for Beneficial Interests in the Unrestricted Global Security.  A beneficial interest in any Restricted Global Security may be exchanged by any holder thereof for a beneficial interest in an Unrestricted Global Security or transferred to a Person who takes delivery thereof in the form of a beneficial interest in an Unrestricted Global Security if the exchange or transfer complies with the requirements of clause (b) above and:

(i)such exchange or transfer is effected pursuant to an Exchange Offer in accordance with the Registration Rights Agreement and the holder of the beneficial interest to be transferred, in the case of an exchange, or the transferee, in the case of a transfer, is not (A) a Broker-Dealer, (B) a Person participating in the distribution of the Exchange Securities or (C)

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a Person who is an affiliate (as defined in Rule 144) of the Company;

(ii)any such transfer is effected pursuant to a Shelf Registration Statement in accordance with the Registration Rights Agreement;

(iii)any such transfer is effected by a Broker-Dealer pursuant to an Exchange Offer Registration Statement in accordance with the Registration Rights Agreement; or

(iv)the Security Registrar receives the following:

(A)if the holder of such beneficial interest in a Restricted Global Security proposes to exchange such beneficial interest for a beneficial interest in an Unrestricted Global Security, a certificate from such holder in the form of Exhibit C hereto, including the certifications in Item (1)(a) thereof; or

(B)if the holder of such beneficial interest in a Restricted Global Security proposes to transfer such beneficial interest to a Person who shall take delivery thereof in the form of a beneficial interest in an Unrestricted Global Security, a certificate from such holder in the form of Exhibit B hereto, including the certifications in Item (4) thereof;

and, in each such case set forth in this subparagraph (iv), an Opinion of Counsel in form reasonably acceptable to the Company to the effect that such exchange or transfer is in compliance with the Securities Act and that the restrictions on transfer contained herein and in the Private Placement Legend are not required in order to maintain compliance with the Securities Act.

If any such transfer is effected pursuant to subparagraph (ii) or (iv) above at a time when an Unrestricted Global Security has not yet been issued, the Company shall issue and, upon receipt of an authentication order in accordance with Section 9(B)(ii) of this Article, the Trustee shall authenticate one or more Unrestricted Global Securities in an aggregate principal amount equal to the principal amount of beneficial interests transferred pursuant to subparagraph (ii) or (iv) above.

Beneficial interests in an Unrestricted Global Security cannot be exchanged for, or transferred to Persons who take delivery thereof in the form of, a beneficial interest in a Restricted Global Security.

(3)Transfer or Exchange of Beneficial Interests for Definitive Securities.

(a)Beneficial Interests in Restricted Global Securities to Restricted Definitive Securities.  If any holder of a beneficial interest in a Restricted Global Security proposes to exchange such beneficial interest

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for a Definitive Security or to transfer such beneficial interest to a Person who takes delivery thereof in the form of a Definitive Security, then, upon receipt by the Security Registrar of the following documentation:

(i)if the holder of such beneficial interest in a Restricted Global Security proposes to exchange such beneficial interest for a Restricted Definitive Security, a certificate from such holder in the form of Exhibit C hereto, including the certifications in Item (2)(a) thereof;

(ii)if such beneficial interest is being transferred to a QIB in accordance with Rule 144A under the Securities Act, a certificate to the effect set forth in Exhibit B hereto, including the certifications in Item (1) thereof;

(iii)if such beneficial interest is being transferred to a Non-U.S. Person in an offshore transaction in accordance with Rule 903 or Rule 904 under the Securities Act, a certificate to the effect set forth in Exhibit B hereto, including the certifications in Item (2) thereof;

(iv)if such beneficial interest is being transferred pursuant to an exemption from the registration requirements of the Securities Act in accordance with Rule 144 under the Securities Act, a certificate to the effect set forth in Exhibit B hereto, including the certifications in Item (3)(a) thereof;

(v)if such beneficial interest is being transferred to an Institutional Accredited Investor or in reliance on any other exemption from the registration requirements of the Securities Act, in either case other than those listed in subparagraphs (ii) through (iv) above, then the transferor must deliver a certificate in the form of Exhibit B hereto, including the certifications, certificates and any Opinion of Counsel required by Item (3) thereof, if applicable;

(vi)if such beneficial interest is being transferred to the Company or any of its Subsidiaries, a certificate to the effect set forth in Exhibit B hereto, including the certifications in Item (3)(b) thereof; or

(vii)if such beneficial interest is being transferred pursuant to an effective registration statement under the Securities Act, a certificate to the effect set forth in Exhibit B hereto, including the certifications in Item (3)(c) thereof,

the Trustee, upon notice of receipt of such documentation by the Security Registrar, shall cause the aggregate principal amount of the applicable Global Security to be reduced accordingly pursuant to Section 9(D)(8) of this Article, and the Company shall execute and the Trustee shall authenticate and make available for delivery to the Person designated in the instructions a Definitive

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Security in the appropriate principal amount.  Any Definitive Security issued in exchange for a beneficial interest in a Restricted Global Security pursuant to this Section 9(D)(3) shall be registered in such name or names and in such authorized denomination or denominations as the holder of such beneficial interest shall instruct the Security Registrar through instructions from the Depositary and the Participant or Indirect Participant.  The Trustee shall make available for delivery such Definitive Securities to the Persons in whose names such Securities of Series No. 1 or Series No. 2 are so registered.  Any Definitive Security issued in exchange for a beneficial interest in a Restricted Global Security pursuant to this Section 9(D)(3)(a) shall bear the Private Placement Legend and shall be subject to all restrictions on transfer contained therein.

Notwithstanding Sections 9(D)(3)(a)(i) and (iii) hereof, a beneficial interest in the Regulation S Global Security may not be (a) exchanged for a Definitive Security prior to (x) the expiration of the Restricted Period and (y) the receipt by the Security Registrar of any certificates required pursuant to Rule 903(c)(3)(B) under the Securities Act or (b) transferred to a Person who takes delivery thereof in the form of a Definitive Security prior to the conditions set forth in clause (a) above or unless the transfer is pursuant to an exemption from the registration requirements of the Securities Act other than Rule 903 or Rule 904.

(b)Beneficial Interests in Restricted Global Securities to Unrestricted Definitive Securities.  Notwithstanding Section 9(D)(3)(a) hereof, a holder of a beneficial interest in a Restricted Global Security may exchange such beneficial interest for an Unrestricted Definitive Security or may transfer such beneficial interest to a Person who takes delivery thereof in the form of an Unrestricted Definitive Security only if:

(i)such exchange or transfer is effected pursuant to an Exchange Offer in accordance with the Registration Rights Agreement and the holder of such beneficial interest, in the case of an exchange, or the transferee, in the case of a transfer, is not (A) a broker-dealer, (B) a Person participating in the distribution of the Exchange Securities or (C) a Person who is an affiliate (as defined in Rule 144) of the Company;

(ii)any such transfer is effected pursuant to a Shelf Registration Statement in accordance with the Registration Rights Agreement;

(iii)any such transfer is effected by a Broker-Dealer pursuant to an Exchange Offer Registration Statement in accordance with the Registration Rights Agreement; or

(iv)the Security Registrar receives the following:

(A)if the holder of such beneficial interest in a Restricted Global Security proposes to exchange such beneficial interest for a Definitive Security that does not bear the Private Placement Legend, a certificate from

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such holder in the form of Exhibit C hereto, including the certifications in Item (1)(b) thereof; or

(B)if the holder of such beneficial interest in a Restricted Global Security proposes to transfer such beneficial interest to a Person who shall take delivery thereof in the form of a Definitive Security that does not bear the Private Placement Legend, a certificate from such holder in the form of Exhibit B hereto, including the certifications in Item (4) thereof;

and, in each such case set forth in this subparagraph (iv), an Opinion of Counsel in form reasonably acceptable to the Company, to the effect that such exchange or transfer is in compliance with the Securities Act and that the restrictions on transfer contained herein and in the Private Placement Legend are not required in order to maintain compliance with the Securities Act.

(c)Beneficial Interests in Unrestricted Global Securities to Unrestricted Definitive Securities.  If any holder of a beneficial interest in an Unrestricted Global Security proposes to exchange such beneficial interest for a Definitive Security or to transfer such beneficial interest to a Person who takes delivery thereof in the form of a Definitive Security, then, upon notice by the Security Registrar of satisfaction of the conditions set forth in Section 9(D)(2)(b) of this Article, the Trustee shall cause the aggregate principal amount of the applicable Global Security to be reduced accordingly pursuant to Section 9(D)(8) of this Article, and the Company shall execute and the Trustee shall authenticate and make available for delivery to the Person designated in the instructions a Definitive Security in the appropriate principal amount.  Any Definitive Security issued in exchange for a beneficial interest pursuant to this Section 9(D)(3)(c)  shall be registered in such name or names and in such authorized denomination or denominations as the holder of such beneficial interest shall instruct the Security Registrar through instructions from the Depositary and the Participant or Indirect Participant.  The Trustee shall make available for delivery such Definitive Securities to the Persons in whose names such Securities of Series No. 1 or Series No. 2 are so registered.  Any Definitive Security issued in exchange for a beneficial interest pursuant to this Section 9(D)(3)(c) shall not bear the Private Placement Legend.  A beneficial interest in an Unrestricted Global Security cannot be exchanged for a Definitive Security bearing the Private Placement Legend or transferred to a Person who takes delivery thereof in the form of a Definitive Security bearing the Private Placement Legend.

(4)Transfer and Exchange of Definitive Securities for Beneficial Interests.

(a)Restricted Definitive Securities to Beneficial Interests in Restricted Global Securities.  If any Holder of a Restricted Definitive Security proposes to exchange such Security of Series No. 1 or Series No. 2 for a beneficial interest in a Restricted Global Security or to

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transfer such Definitive Securities to a Person who takes delivery thereof in the form of a beneficial interest in a Restricted Global Security, then, upon receipt by the Security Registrar of the following documentation:

(i)if the Holder of such Restricted Definitive Security proposes to exchange such Security of Series No. 1 or Series No. 2 for a beneficial interest in a Restricted Global Security, a certificate from such Holder in the form of Exhibit C hereto, including the certifications in Item (2)(b) thereof;

(ii)if such Definitive Security is being transferred to a QIB in accordance with Rule 144A under the Securities Act, a certificate to the effect set forth in Exhibit B hereto, including the certifications in Item (1) thereof;

(iii)if such Definitive Security is being transferred to a Non-U.S. Person in an offshore transaction in accordance with Rule 903 or Rule 904 under the Securities Act, a certificate to the effect set forth in Exhibit B hereto, including the certifications in Item (2) thereof;

(iv)if such Definitive Security is being transferred pursuant to an exemption from the registration requirements of the Securities Act in accordance with Rule 144 under the Securities Act, a certificate to the effect set forth in Exhibit B hereto, including the certifications in Item (3)(a) thereof;

(v)if such Definitive Security is being transferred to an Institutional Accredited Investor or in reliance on any other exemption from the registration requirements of the Securities Act, in either case, other than those listed in subparagraphs (ii) through (iv) above, a certificate in the form of Exhibit B hereto, including certifications, certificates, and any Opinion of Counsel required by Item (3) thereof, if applicable;

(vi)if such Definitive Security is being transferred to the Company or any of its Subsidiaries, a certificate to the effect set forth in Exhibit B hereto, including the certifications in Item (3)(b) thereof; or

(vii)if such Definitive Security is being transferred pursuant to an effective registration statement under the Securities Act, a certificate to the effect set forth in Exhibit B hereto, including the certifications in Item (3)(c) thereof,

the Trustee, upon notice of receipt of such documentation by the Security Registrar, shall cancel the Definitive Security, increase or cause to be increased the aggregate principal amount of, in the case of subparagraph (i) above, the appropriate Restricted Global Security and, in the case of subparagraph (ii) above, the Rule 144A Global Security, and, in the case of subparagraph (iii) above, the Regulation S Global Security.

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(b)Restricted Definitive Securities to Beneficial Interests in Unrestricted Global Securities.  A Holder of a Restricted Definitive Security may exchange such Security of Series No. 1 or Series No. 2 for a beneficial interest in an Unrestricted Global Security or transfer such Restricted Definitive Security to a Person who takes delivery thereof in the form of a beneficial interest in an Unrestricted Global Security only if:

(i)such exchange or transfer is effected pursuant to an Exchange Offer in accordance with the Registration Rights Agreement and the Holder, in the case of an exchange, or the transferee, in the case of a transfer, is not (A) a broker-dealer, (B) a Person participating in the distribution of the Exchange Securities or (C) a Person who is an affiliate (as defined in Rule 144) of the Company;

(ii)any such transfer is effected pursuant to a Shelf Registration Statement in accordance with the Registration Rights Agreement;

(iii)any such transfer is effected by a Broker-Dealer pursuant to an Exchange Offer Registration Statement in accordance with the Registration Rights Agreement; or

(iv)the Security Registrar receives the following:

(A)if the Holder of such Definitive Securities proposes to exchange such Securities of Series No. 1 or Series No. 2 for a beneficial interest in the Unrestricted Global Security, a certificate from such Holder in the form of Exhibit C hereto, including the certifications in Item (1)(c) thereof; or

(B)if the Holder of such Definitive Securities proposes to transfer such Securities of Series No. 1 or Series No. 2 to a Person who shall take delivery thereof in the form of a beneficial interest in the Unrestricted Global Security, a certificate from such Holder in the form of Exhibit B hereto, including the certifications in Item (4) thereof;

and, in each such case set forth in this subparagraph (iv), an Opinion of Counsel in form reasonably acceptable to the Company to the effect that such exchange or transfer is in compliance with the Securities Act, that the restrictions on transfer contained herein and in the Private Placement Legend are not required in order to maintain compliance with the Securities Act, and such Definitive Securities are being exchanged or transferred in compliance with any applicable blue sky securities laws of any State of the United States.

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Upon satisfaction of the conditions of any of the subparagraphs in this Section 9(D)(4)(b), the Trustee shall cancel the Definitive Securities and increase or cause to be increased the aggregate principal amount of the Unrestricted Global Security.

(c)Unrestricted Definitive Securities to Beneficial Interests in Unrestricted Global Securities.  A Holder of an Unrestricted Definitive Security may exchange such Security of Series No. 1 or Series No. 2 for a beneficial interest in an Unrestricted Global Security or transfer such Definitive Securities to a Person who takes delivery thereof in the form of a beneficial interest in an Unrestricted Global Security at any time.  Upon receipt of a request for such an exchange or transfer, the Trustee shall cancel the applicable Unrestricted Definitive Security and increase or cause to be increased the aggregate principal amount of one of the Unrestricted Global Securities.

If any such exchange or transfer from a Definitive Security to a beneficial interest is effected pursuant to Sections 9(D)(4)(b)(ii) or (iv) of this Article or the first paragraph of this Section 9(D)(4)(c) at a time when an Unrestricted Global Security has not yet been issued, the Company shall issue and, upon receipt of an authentication order in accordance with Section 9(B) of this Article, the Trustee shall authenticate one or more Unrestricted Global Securities in an aggregate principal amount equal to the principal amount of beneficial interests transferred pursuant to Sections 9(D)(4)(b)(ii) or (iv) of this Article or the first paragraph of this Section 9(D)(4)(c).

(5)Transfer and Exchange of Definitive Securities for Definitive Securities.  Upon request by a Holder of Definitive Securities and such Holder’s compliance with the provisions of this Section 9(D)(5), the Security Registrar shall register the transfer or exchange of Definitive Securities.  Prior to such registration of transfer or exchange, the requesting Holder shall present or surrender to the Security Registrar the Definitive Securities duly endorsed or accompanied by a written instruction of transfer in form satisfactory to the Security Registrar duly executed by such Holder or by his attorney, duly authorized in writing.  In addition, the requesting Holder shall provide any additional certifications, documents and information, as applicable, pursuant to the provisions of this Section 9(D)(5).

(a)Restricted Definitive Securities to Restricted Definitive Securities.  Restricted Definitive Securities may be transferred to and registered in the name of Persons who take delivery thereof if the Security Registrar receives the following:

(i)if the transfer shall be made pursuant to Rule 144A under the Securities Act, then the transferor must deliver a certificate in the form of Exhibit B hereto, including the certifications in Item (1) thereof;

(ii)if the transfer shall be made pursuant to Rule 903 or Rule 904 of the Securities Act, then the transferor must deliver a certificate in the form of Exhibit B hereto, including the certifications in Item (2) thereof; and

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(iii)if the transfer shall be made pursuant to any other exemption from the registration requirements of the Securities Act, then the transferor must deliver a certificate in the form of Exhibit B hereto, including the certifications, certificates and Opinion of Counsel required by Item (3) thereof, if applicable.

(b)Restricted Definitive Securities to Unrestricted Definitive Securities.  Any Restricted Definitive Security may be exchanged by the Holder thereof for an Unrestricted Definitive Security or transferred to a Person or Persons who take delivery thereof in the form of an Unrestricted Definitive Security if:

(i)such exchange or transfer is effected pursuant to an Exchange Offer in accordance with the Registration Rights Agreement and the Holder of such Securities of Series No. 1 or Series No. 2, in the case of an exchange, or the transferee, in the case of a transfer, is not (A) a broker-dealer, (B) a Person participating in the distribution of the Exchange Securities or (C) a Person who is an affiliate (as defined in Rule 144) of the Company;

(ii)any such transfer is effected pursuant to a Shelf Registration Statement in accordance with the Registration Rights Agreement;

(iii)any such transfer is effected by a Broker-Dealer pursuant to an Exchange Offer Registration Statement in accordance with the Registration Rights Agreement; or

(iv)the Security Registrar receives the following:

(A)if the Holder of such Restricted Definitive Securities proposes to exchange such Securities of Series No. 1 or Series No. 2 for an Unrestricted Definitive Security, a certificate from such Holder in the form of Exhibit C hereto, including the certifications in Item (1)(b) thereof; or

(B)if the Holder of such Restricted Definitive Securities proposes to transfer such Securities of Series No. 1 or Series No. 2 to a Person who shall take delivery thereof in the form of an Unrestricted Definitive Security, a certificate from such Holder in the form of Exhibit B hereto, including the certifications in Item (4) thereof;

and, in each such case set forth in this subparagraph (iv), an Opinion of Counsel in form reasonably acceptable to the Company to the effect that such exchange or transfer is in compliance with the Securities Act, that the restrictions on transfer contained herein and in the Private Placement Legend are not required in order to

64

maintain compliance with the Securities Act, and such Restricted Definitive Security is being exchanged or transferred in compliance with any applicable blue sky securities laws of any State of the United States.

(c)Unrestricted Definitive Securities to Unrestricted Definitive Securities.  A Holder of Unrestricted Definitive Securities may transfer such Securities of Series No. 1 or Series No. 2 to a Person who takes delivery thereof in the form of an Unrestricted Definitive Security.  Upon receipt of a request for such a transfer, the Security Registrar shall register the Unrestricted Definitive Securities pursuant to the instructions from the Holder thereof.  Unrestricted Definitive Securities cannot be exchanged for or transferred to Persons who take delivery thereof in the form of a Restricted Definitive Security.

(6)Exchange Offer.  Upon the occurrence of an Exchange Offer in accordance with the Registration Rights Agreement, the Company shall issue and, upon receipt of (a) an authentication order in accordance with Section 9(B) of this Article and (b) an Opinion of Counsel opining as to the enforceability of the Exchange Securities and the guarantees thereof, if any, the Trustee shall authenticate (1) one or more Unrestricted Global Securities in an aggregate principal amount equal to the principal amount of the beneficial interests in the Restricted Global Securities tendered for acceptance by Persons that are not (i) Broker-Dealers, (ii) Persons participating in the distribution of the Exchange Securities or (iii) Persons who are affiliates (as defined in Rule 144) of the Company and accepted for exchange in such Exchange Offer and (2) Definitive Securities in an aggregate principal amount equal to the principal amount of the Restricted Definitive Securities accepted for exchange in such Exchange Offer, unless the Holders of such Restricted Definitive Securities shall request the receipt of Definitive Securities, in which case the Company shall execute and the Trustee shall authenticate and deliver to the Persons designated by the Holders of such Restricted Definitive Securities one or more Definitive Securities without the Private Placement Legend in the appropriate principal amount.  Concurrent with the issuance of such Unrestricted Global Securities, the Trustee shall cause the aggregate principal amount of the applicable Restricted Global Securities to be reduced accordingly, and the Company shall execute and the Trustee shall authenticate and make available for delivery to the Persons designated by the Holders of Definitive Securities so accepted Definitive Securities in the appropriate principal amount.

(7)Legends.  The following legends shall appear on the face of all Global Securities and Definitive Securities issued under this Indenture unless specifically stated otherwise in the applicable provisions of this Supplemental Indenture.

(a)Private Placement Legend.

(i)Except as permitted by subparagraph (b) below, each Global Security and each Definitive Security (and all Securities of Series No. 1 or Series No. 2 issued in exchange therefor or substitution thereof) shall bear the legend in substantially the following form:

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“THIS NOTE (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER THE UNITED STATES SECURITIES ACT OF 1933 (THE “SECURITIES ACT”), AND THIS NOTE MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM.  EACH PURCHASER OF THIS NOTE IS HEREBY NOTIFIED THAT THE SELLER OF THIS NOTE MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER.

THE HOLDER OF THIS NOTE AGREES FOR THE BENEFIT OF THE COMPANY THAT (A) THIS NOTE MAY BE OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (I) IN THE UNITED STATES TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (II) OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE SECURITIES ACT, (III) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER (IF AVAILABLE), (IV) TO AN INSTITUTIONAL “ACCREDITED INVESTOR” (AS DEFINED IN RULE 501(a)(1), (2), (3) or (7) OF REGULATION D UNDER THE SECURITIES ACT) THAT, PRIOR TO SUCH TRANSFER, FURNISHES TO THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE TRANSFER OF THIS NOTE (THE FORM OF WHICH CAN BE OBTAINED FROM THE TRUSTEE) AND, IF SUCH TRANSFER IS IN RESPECT OF AN AGGREGATE PRINCIPAL AMOUNT OF NOTES LESS THAN $250,000, AN OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY THAT SUCH TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT, OR (V) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH OF CASES (I) THROUGH (V) IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES, AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER OF THIS NOTE FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A) ABOVE.”

(ii)Notwithstanding the foregoing, any Global Security or Definitive Security issued pursuant to subparagraph (2)(d), (3)(b), (4)(b), (4)(c), (5)(b), (5)(c) or (6) of this Section 9(D) (and all Securities of Series No. 1 or Series No. 2 issued in exchange therefor or substitution thereof) shall not bear the Private Placement Legend.

(b)Global Security Legend.  Each Global Security shall bear a legend in substantially the following form:

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“THIS GLOBAL SECURITY IS HELD BY THE DEPOSITARY (AS DEFINED IN THE SUPPLEMENTAL INDENTURE UNDER THE INDENTURE GOVERNING THIS SECURITY) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO ARTICLE III OF THE INDENTURE, (II) THIS GLOBAL SECURITY MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 9(D)(1) OF ARTICLE FOUR OF THE SUPPLEMENTAL INDENTURE, (III) THIS GLOBAL SECURITY MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION 309 OF THE INDENTURE AND (IV) THIS GLOBAL SECURITY MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY OR ANY SUCCESSOR THERETO.”

Additionally, for so long as DTC is the Depositary with respect to any Global Security, each such Global Security shall also bear a legend in substantially the following form:

“UNLESS THIS SECURITY IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY, TO THE COMPANY OR ANY SUCCESSOR THERETO OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.”

(8)Cancellation and/or Adjustment of Global Securities.  At such time as all beneficial interests in a particular Global Security have been exchanged for Definitive Securities or a particular Global Security has been redeemed, repurchased or canceled in whole and not in part, each such Global Security shall be returned to or retained and canceled by the Trustee in accordance with Section 309 of the Indenture.  At any time prior to such cancellation, if any beneficial interest in a Global Security is exchanged for or transferred to a Person who shall take delivery thereof in the form of a beneficial interest in another Global Security or for Definitive Securities, the principal amount of Securities of Series No. 1 or Series No. 2 represented by such Global Security shall be reduced accordingly and an endorsement shall be made on such Global Security, by the Trustee, the Security Custodian or the Depositary at the direction of the Trustee, to reflect such reduction; and if the beneficial interest is being exchanged for or transferred to a Person who shall take delivery thereof in

67

the form of a beneficial interest in another Global Security, such other Global Security shall be increased accordingly and an endorsement shall be made on such Global Security, by the Trustee, the Security Custodian or by the Depositary at the direction of the Trustee, to reflect such increase.

(9)General Provisions Relating to Transfers and Exchanges.

(a)To permit registrations of transfers and exchanges, subject to Section 9(D) of this Article, the Company shall execute and, upon the Company’s order, the Trustee or an Authenticating Agent shall authenticate Global Securities and Definitive Securities at the Security Registrar’s request.

(b)All certifications, certificates and Opinions of Counsel required to be submitted to the Security Registrar pursuant to this Section 9(D) to effect a transfer or exchange may be submitted by facsimile.

(c)The Trustee and the Security Registrar shall have no obligation or duty to monitor, determine or inquire as to whether any Person is or is not a Person described in clauses (A), (B) and (C) of each of Sections 9(D)(2)(d)(i), 9(D)(3)(b)(i), 9(D)(4)(b)(i), 9(D)(5)(b)(i) and 9(D)(6) of this Article or under applicable law (other than the Trust Indenture Act) with respect to any transfer of any interest in any Security of Series No. 1 or Series No. 2 (including any transfers between or among Participants or beneficial owners of interests in any Global Security) other than to require delivery of such certificates and other documentation or evidence as are expressly required by, and to do so if and when expressly required by the terms of, this Indenture, and to examine the same to determine substantial compliance as to form with the express requirements hereof.

ARTICLE FIVE

Miscellaneous Provisions

SECTION 1.This Supplemental Indenture No. 1 is a supplement to the Original Indenture.  As supplemented by this Supplemental Indenture No 1, the Indenture is in all respects ratified, approved and confirmed, and the Original Indenture and this Supplemental Indenture No. 1 shall together constitute the Indenture.

SECTION 2.The recitals contained in this Supplemental Indenture No. 1 shall be taken as the statements of the Company, and the Trustee assumes no responsibility for their correctness and makes no representations as to the validity or sufficiency of this Supplemental Indenture No. 1.

SECTION 3.This Supplemental Indenture and the Securities shall be governed by and construed in accordance with the law of the State of New York (including without limitation Section 5-1401 of the New York General Obligations Law or any successor to such statute), except to the extent that the Trust Indenture Act shall be applicable.

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SECTION 4.In case any provision in this Supplemental Indenture or the Securities shall be held to be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

SECTION 5.If any provision of this Supplemental Indenture limits, qualifies or conflicts with any provision of the Original Indenture, the provision in this Supplemental Indenture shall control.

This instrument may be executed in any number of counterparts, each of which so executed shall be deemed to be an original, but all such counterparts shall together constitute but one and the same instrument.

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IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture No. 1 to be duly executed, and their respective corporate seals to be hereunto affixed and attested, all as of the day and year first written above.

	NORTHWESTERN CORPORATION
	By	/s/ Brian B. Bird
	Name: Brian B. Bird
	Title:
Attest:
/s/ Paul J. Evans
	U.S. BANK NATIONAL ASSOCIATION
	By	/s/ Lori-Anne Rosenberg
	Name: Lori-Anne Rosenberg
	Title: Asst. Vice President
Attest:

70

STATE OF NEW YORK	)
	)  ss.:
COUNTY OF NEW YORK	)

On this 1st day of November, 2004, before me, a notary public, the undersigned officer, personally appeared Brian B. Bird, who acknowledged himself to be the Vice President of Northwestern Corporation, a corporation and that he, as such Vice President, being authorized to do so, executed the foregoing instrument for the purposes therein contained, by signing the name of the corporation by himself as Vice President.

In witness whereof, I hereunto set my hand and official seal.

/s/ Keith M. Wixson

Notary Public

[STAMP]
KEITH M. WIXSON
NOTARY PUBLIC, State of New York
No. 01WI5081858
Qualified in New York County
Commission Expires July 14, 2007

71

STATE OF NEW YORK	)
	)    ss.:
COUNTY OF NEW YORK	)

On this 1st day of November, 2004, before me, a notary public, the undersigned officer, personally appeared Lori-Anne Rosenberg, who acknowledged herself to be the Asst. Vice President of U.S. Bank National Association, a corporation and that she, as such Asst. Vice President, being authorized to do so, executed the foregoing instrument for the purposes therein contained, by signing the name of the corporation by herself as Asst. Vice President.

In witness whereof, I hereunto set my hand and official seal.

/s/ Keith M. Wixson

Notary Public

[STAMP]
KEITH M. WIXSON
NOTARY PUBLIC, State of New York
No. 01WI5081858
Qualified in New York County
Commission Expires July 14, 2007

72

Exhibit A

[Form of Securities of Series No. 1]

73

EXHIBIT B

FORM OF CERTIFICATE OF TRANSFER

NorthWestern Corporation
125 S. Dakota Avenue
Sioux Falls, South Dakota 57104

U.S. Bank National Association
60 Livingston Avenue
St. Paul, Minnesota 55107

Re:5.875% Senior Secured Notes, Series A due 2014

Reference is hereby made to the Indenture, dated as of November 1, 2004 (the “Indenture”), between NorthWestern Corporation, as issuer (the “Company”), and U.S. Bank, National Association, as trustee.  Capitalized terms used but not defined herein shall have the meanings given to them in the Indenture.

                                          , (the “Transferor”) owns and proposes to transfer the Note[s] or interest in such Note[s] specified in Annex A hereto, in the principal amount of $    in such Note[s] or interests (the “Transfer”), to                                       (the “Transferee”), as further specified in Annex A hereto.  In connection with the Transfer, the Transferor hereby certifies that:

[CHECK ALL THAT APPLY]

1.o  Check if Transferee will take delivery of a beneficial interest in the 144A Global Note or a Definitive Note Pursuant to Rule 144A.  The Transfer is being effected pursuant to and in accordance with Rule 144A under the United States Securities Act of 1933, as amended (the “Securities Act”), and, accordingly, the Transferor hereby further certifies that the beneficial interest or Definitive Note is being transferred to a Person that the Transferor reasonably believed and believes is purchasing the beneficial interest or Definitive Note for its own account, or for one or more accounts with respect to which such Person exercises sole investment discretion, and such Person and each such account is a “qualified institutional buyer” within the meaning of Rule 144A in a transaction meeting the requirements of Rule 144A and such Transfer is in compliance with any applicable blue sky securities laws of any state of the United States.  Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the 144A Global Note and/or the Definitive Note and in the Indenture and the Securities Act.

2.o  Check If Transferee will take delivery of a beneficial interest in the Regulation S Global Note or a Definitive Note pursuant to Regulation S.  The Transfer is being effected pursuant to and in accordance with Rule 903 or Rule 904 under the Securities Act and, accordingly, the Transferor hereby further certifies that (i) the Transfer is not being made to a person in the United States and (x) at the time the buy order was originated, the Transferee was outside the United States or such Transferor and any Person acting on its behalf reasonably believed and believes that the Transferee was outside the United States or (y) the transaction was executed in, on or through the facilities of a designated offshore securities market and neither such Transferor nor any Person acting on its behalf knows that the transaction was prearranged with a buyer in the United States, (ii) no directed selling efforts have been made in contravention of the requirements of Rule 903(b) or Rule 904(b) of Regulation S under the Securities Act, (iii)-

74

the transaction is not part of a plan or scheme to evade the registration requirements of the Securities Act and (iv) if the proposed transfer is being made prior to the expiration of the Restricted Period, the transfer is not being made to a U.S.  Person or for the account or benefit of a U.S. Person (other than an Initial Purchaser).  Upon consummation of the proposed transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will be subject to the restrictions on Transfer enumerated in the Private Placement Legend printed on the Regulation S Global Note, and/or the Definitive Note and in the Indenture and the Securities Act.

3.o  Check and complete if Transferee will take delivery of a beneficial interest in a Global Note or a Definitive Note pursuant to any provision of the Securities Act other than Rule 144A or Regulation S.  The Transfer is being effected in compliance with the transfer restrictions applicable to beneficial interests in Restricted Global Notes and Restricted Definitive Notes and pursuant to and in accordance with the Securities Act and any applicable blue sky securities laws of any state of the United States, and accordingly the Transferor hereby further certifies that (check one):

(A)o  such Transfer is being effected pursuant to and in accordance with Rule 144 under the Securities Act;

or

(B)o  such Transfer is being effected to the Company or a subsidiary thereof;

or

(C)o  such Transfer is being effected pursuant to an effective registration statement under the Securities Act and in compliance with the prospectus delivery requirements of the Securities Act.

4.o  Check if Transferee will take delivery of a beneficial interest in an Unrestricted Global Note or an Unrestricted Definitive Note.

(a) o Check if Transfer is pursuant to Rule 144.  (i) The Transfer is being effected pursuant to and in accordance with Rule 144 under the Securities Act and in compliance with the transfer restrictions contained in the Indenture and any applicable blue sky securities laws of any state of the United States and (ii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act.  Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will no longer be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Global Notes, on Restricted Definitive Notes and in the Indenture.

(b) o Check if Transfer is Pursuant to Regulation S. (i) The Transfer is being effected pursuant to and in accordance with Rule 903 or Rule 904 under the Securities Act and in compliance with the transfer restrictions contained in the Indenture and any applicable blue sky securities laws of any state of the United States and (ii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act.  Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will no longer be

75

subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Global Notes, on Restricted Definitive Notes and in the Indenture.

(c) o Check if Transfer is Pursuant to Other Exemption.  (i) The Transfer is being effected pursuant to and in compliance with an exemption from the registration requirements of the Securities Act other than Rule 144, Rule 903 or Rule 904 and in compliance with the transfer restrictions contained in the Indenture and any applicable blue sky securities laws of any State of the United States and (ii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act.  Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will not be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Global Notes or Restricted Definitive Notes and in the Indenture.

This certificate and the statements contained herein are made for the benefit of the Trustee and the Registrar and the benefit of the Company.

	[Insert Name of Transferor]
	By:
	Name:
	Title:
Dated:

76

ANNEX A TO CERTIFICATE OF TRANSFER

1.The Transferor owns and proposes to transfer the following:

[CHECK ONE OF (a) OR (b)]

(1)o a beneficial interest in the:

(a)o 144A Global Note (CUSIP              ), or

(b)o Regulation S Global Note (CUSIP              ), or

(2)o a Restricted Definitive Note.

2.After the Transfer the Transferee will hold:

[CHECK ONE]

(3)o a beneficial interest in the:

(a)o 144A Global Note (CUSIP              ), or

(b)o Regulation S Global Note (CUSIP              ), or

(c)o Unrestricted Global Note (CUSIP              ), or

(4)o a Restricted Definitive Note; or

(5)o an Unrestricted Definitive Note,

in accordance with the terms of the Indenture.

77

EXHIBIT C

FORM OF CERTIFICATE OF EXCHANGE

NorthWestern Corporation
125 S. Dakota Avenue
Sioux Falls, South Dakota 57104

U.S. Bank National Association
60 Livingston Avenue
St. Paul, Minnesota 55107

Re:5.875% Senior Secured Notes, Series A due 2014

(CUSIP        )

Reference is hereby made to the Indenture, dated as of November 1, 2004 (the “Indenture”), between NorthWestern Corporation, as issuer (the “Company”), and U.S. Bank National Association, as trustee.  Capitalized terms used but not defined herein shall have the meanings given to them in the Indenture.

                                       , (the “Owner”) owns and proposes to exchange the Note[s] or interest in such Note[s] specified herein, in the principal amount of $                 in such Note[s] or interests (the “Exchange”).  In connection with the Exchange, the Owner hereby certifies that:

1.Exchange of Restricted Definitive Notes or Beneficial Interests in a Restricted Global Note for Unrestricted Definitive Notes or Beneficial Interests in an Unrestricted Global Note

(a)o  Check if Exchange is from beneficial interest in a Restricted Global Note to beneficial interest in an Unrestricted Global Note.  In connection with the Exchange of the Owner’s beneficial interest in a Restricted Global Note for a beneficial interest in an Unrestricted Global Note in an equal principal amount, the Owner hereby certifies (i) the beneficial interest is being acquired for the Owner’s own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to the Global Notes and pursuant to and in accordance with the United States Securities Act of 1933, as amended (the “Securities Act”), (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the beneficial interest in an Unrestricted Global Note is being acquired in compliance with any applicable blue sky securities laws of any state of the United States.

(b)o  Check if Exchange is from beneficial interest in a Restricted Global Note to Unrestricted Definitive Note.  In connection with the Exchange of the Owner’s beneficial interest in a Restricted Global Note for an Unrestricted Definitive Note, the Owner hereby certifies (i) the Definitive Note is being acquired for the Owner’s own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to the Restricted Global Notes and pursuant to and in accordance with the Securities Act, (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the Definitive Note is being acquired in compliance with any applicable blue sky securities laws of any state of the United States.

(c)o  Check if Exchange is from Restricted Definitive Note to beneficial interest in an Unrestricted Global Note.  In connection with the Owner’s Exchange of a Restricted Definitive Note for a beneficial interest in an Unrestricted Global Note, the Owner hereby certifies (i) the

beneficial interest is being acquired for the Owner’s own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to Restricted Definitive Notes and pursuant to and in accordance with the Securities Act, (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the beneficial interest is being acquired in compliance with any applicable blue sky securities laws of any state of the United States.

(d)o  Check if Exchange is from Restricted Definitive Note to Unrestricted Definitive Note.  In connection with the Owner’s Exchange of a Restricted Definitive Note for an Unrestricted Definitive Note, the Owner hereby certifies (i) the Unrestricted Definitive Note is being acquired for the Owner’s own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to Restricted Definitive Notes and pursuant to and in accordance with the Securities Act, (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the Unrestricted Definitive Note is being acquired in compliance with any applicable blue sky securities laws of any state of the United States.

2.Exchange of Restricted Definitive Notes or Beneficial Interests in Restricted Global Notes for Restricted Definitive Notes or Beneficial Interests in Restricted Global Notes

(a) oCheck if Exchange is from beneficial interest in a Restricted Global Note to Restricted Definitive Note.  In connection with the Exchange of the Owner’s beneficial interest in a Restricted Global Note for a Restricted Definitive Note with an equal principal amount, the Owner hereby certifies that the Restricted Definitive Note is being acquired for the Owner’s own account without transfer.  Upon consummation of the proposed Exchange in accordance with the terms of the Indenture, the Restricted Definitive Note issued will continue to be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Definitive Note and in the Indenture and the Securities Act.

(b) oCheck if Exchange is from Restricted Definitive Note to beneficial interest in a Restricted Global Note.  In connection with the Exchange of the Owner’s Restricted Definitive Note for a beneficial interest in the [CHECK ONE]  144A Global Note,  Regulation S Global Note with an equal principal amount, the Owner hereby certifies (i) the beneficial interest is being acquired for the Owner’s own account without transfer and (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to the Restricted Global Notes and pursuant to and in accordance with the Securities Act, and in compliance with any applicable blue sky securities laws of any state of the United States.  Upon consummation of the proposed Exchange in accordance with the terms of the Indenture, the beneficial interest issued will be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the relevant Restricted Global Note and in the Indenture and the Securities Act.

This certificate and the statements contained herein are made for the benefit of the Trustee and the Registrar and the benefit of the Company.

	[Insert Name of Transferor]
	By:
	Name:
	Title:
Dated:

2

Exhibit D

[Form of Securities of Series No. 2]

3

EX-4.3

Exhibit 4.3

$225,000,000

NorthWestern Corporation

5.875% Senior Secured Notes due 2014

REGISTRATION RIGHTS AGREEMENT

November 1, 2004

Credit Suisse First Boston LLC

Lehman Brothers Inc.,

As Representatives of the Several Initial Purchasers

c/o Credit Suisse First Boston LLC

Eleven Madison Avenue

New York, New York 10010-3629

Dear Sirs:

NorthWestern Corporation, a Delaware corporation (the “Company”), proposes to issue and sell to the several initial purchasers named in Schedule A hereto (collectively, the “Initial Purchasers”), upon the terms set forth in a purchase agreement, dated October 25, 2004 (the “Purchase Agreement”), among the Company and the Initial Purchasers, $225,000,000 aggregate principal amount of its 5.875% Senior Secured Notes due 2014 (the “Initial Securities”)  The Initial Securities will be issued pursuant to an Indenture, dated as of November 1, 2004, as supplemented by a supplemental indenture thereto (the “Indenture”), between the Company and US Bank National Association, as trustee (the “Trustee”).  As an inducement to the Initial Purchasers, the Company agrees with the Initial Purchasers, for the benefit of the holders of the Initial Securities (including, without limitation, the Initial Purchasers), the Exchange Securities (as defined below) and the Private Exchange Securities (as defined below) (collectively the “Holders”), as follows:

1.     Registered Exchange Offer.  Unless not permitted by applicable law or applicable interpretations of the Staff of the Securities and Exchange Commission (the “Commission”), the Company shall, at its own cost, prepare and, not later than 180 days after (or if the 180th day is not a business day, the first business day thereafter) (such day being the “Exchange Offer Filing Deadline”) the date of original issue of the Initial Securities (the “Issue Date”), file with the Commission a registration statement (the “Exchange Offer Registration Statement”) on an appropriate form under the Securities Act of 1933, as amended (the “Securities Act”), with respect to a proposed offer (the “Registered Exchange Offer”) to the Holders of Transfer Restricted Securities (as defined in Section 6 hereof), who are not prohibited by any law or policy of the Commission from participating in the Registered Exchange Offer, to issue and deliver to such Holders, in exchange for the Initial Securities, a like aggregate principal amount of debt securities (the “Exchange Securities”) of the Company issued under the Indenture and identical in all material respects to the Initial Securities (except for the transfer restrictions relating to the Initial Securities and the provisions relating to the matters described in Section 6 hereof) that are registered under the Securities Act.  To the extent required by the Securities Act, the Company shall also register the Collateral Bonds (as such term is defined in the Purchase Agreement) in the Exchange Offer Registration Statement.  The Company shall use its commercially reasonable efforts to cause such Exchange Offer Registration Statement to become effective under the Securities Act within 270 days (or if the 270th day is not a business day, the first business day thereafter) (such day being the “Exchange Offer Effectiveness Deadline”) after the Issue Date of the Initial Securities and shall keep the Exchange Offer Registration Statement effective for not less than 30 days (or longer, if required by applicable law) after the

date notice of the Registered Exchange Offer is mailed to the Holders (such period being called the “Exchange Offer Registration Period”).

If the Company effects the Registered Exchange Offer, the Company will be entitled to close the Registered Exchange Offer 30 days after the commencement thereof provided that the Company has accepted all the Initial Securities theretofore validly tendered in accordance with the terms of the Registered Exchange Offer.

Following the declaration of the effectiveness of the Exchange Offer Registration Statement, the Company shall promptly commence the Registered Exchange Offer, it being the objective of such Registered Exchange Offer to enable each Holder of Transfer Restricted Securities (as defined in Section 6 hereof) electing to exchange the Initial Securities for Exchange Securities (assuming that such Holder is not an affiliate of the Company within the meaning of the Securities Act, acquires the Exchange Securities in the ordinary course of such Holder’s business and has no arrangements with any person to participate in the distribution of the Exchange Securities and is not prohibited by any law or policy of the Commission from participating in the Registered Exchange Offer) to trade such Exchange Securities from and after their receipt without any limitations or restrictions under the Securities Act and without material restrictions under the securities laws of the several states of the United States.

The Company acknowledges that, pursuant to current interpretations by the Commission’s staff of Section 5 of the Securities Act, in the absence of an applicable exemption therefrom, (i) each Holder which is a broker-dealer electing to exchange Initial Securities, acquired for its own account as a result of market making activities or other trading activities, for Exchange Securities (an “Exchanging Dealer”), is required to deliver a prospectus containing the information set forth in (a) Annex A hereto on the cover, (b) Annex B hereto in the “Exchange Offer Procedures” section and the “Purpose of the Exchange Offer” section, and (c) Annex C hereto in the “Plan of Distribution” section of such prospectus in connection with a sale of any such Exchange Securities received by such Exchanging Dealer pursuant to the Registered Exchange Offer and (ii) an Initial Purchaser that elects to sell Exchange Securities acquired in exchange for Initial Securities constituting any portion of an unsold allotment is required to deliver a prospectus containing the information required by Items 507 or 508 of Regulation S-K under the Securities Act, as applicable, in connection with such sale.

The Company shall use its commercially reasonable efforts to keep the Exchange Offer Registration Statement effective and to amend and supplement the prospectus contained therein, in order to permit such prospectus to be lawfully delivered by all persons subject to the prospectus delivery requirements of the Securities Act for such period of time as such persons must comply with such requirements in order to resell the Exchange Securities; provided, however, that (i) in the case where such prospectus and any amendment or supplement thereto must be delivered by an Exchanging Dealer or an Initial Purchaser, such period shall be the lesser of 180 days and the date on which all Exchanging Dealers and the Initial Purchasers have sold all Exchange Securities held by them (unless such period is extended pursuant to Section 3(j) below) and (ii) the Company shall make such prospectus and any amendment or supplement thereto, available to any broker-dealer for use in connection with any resale of any Exchange Securities for a period of not less than 90 days after the consummation of the Registered Exchange Offer.

If, upon consummation of the Registered Exchange Offer, any Initial Purchaser holds Initial Securities acquired by it as part of its initial distribution, the Company, simultaneously with the delivery of the Exchange Securities pursuant to the Registered Exchange Offer, shall issue and deliver to such Initial Purchaser upon the written request of such Initial Purchaser, in exchange (the “Private Exchange”) for the Initial Securities held by such Initial Purchaser, a like principal amount of debt securities of the Company issued under the Indenture and identical in all material respects (including the existence of restrictions on transfer under the Securities Act and the securities laws of the several states of the United States, but excluding provisions relating to the matters described in Section 6 hereof) to the Initial Securities (the “Private Exchange Securities”).  The Initial Securities, the Exchange Securities and the Private Exchange Securities are herein collectively called the “Securities”.

In connection with the Registered Exchange Offer, the Company shall:

(a)     mail to each Holder a copy of the prospectus forming part of the Exchange Offer Registration Statement, together with an appropriate letter of transmittal and related documents;

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(b)     keep the Registered Exchange Offer open for not less than 20 days (or longer, if required by applicable law) after the date notice thereof is mailed to the Holders;

(c)     utilize the services of a depositary for the Registered Exchange Offer with an address in the Borough of Manhattan, The City of New York, which may be the Trustee or an affiliate of the Trustee;

(d)     permit Holders to withdraw tendered Securities at any time prior to the close of business, New York time, on the last business day on which the Registered Exchange Offer shall remain open; and

(e)     otherwise comply with all applicable laws.

As soon as practicable after the close of the Registered Exchange Offer or the Private Exchange, as the case may be, the Company shall, directly or indirectly:

(x)     accept for exchange all the Securities validly tendered and not withdrawn pursuant to the Registered Exchange Offer and the Private Exchange;

(y)     deliver to the Trustee for cancellation all the Initial Securities so accepted for exchange; and

(z)     cause the Trustee to authenticate and deliver promptly to each Holder of the Initial Securities, Exchange Securities or Private Exchange Securities, as the case may be, equal in principal amount to the Initial Securities of such Holder so accepted for exchange.

The Indenture will provide that the Exchange Securities will not be subject to the transfer restrictions set forth in the Indenture and that all the Securities will vote and consent together on all matters as one class and that none of the Securities will have the right to vote or consent as a class separate from one another on any matter.

Interest on each Exchange Security and Private Exchange Security issued pursuant to the Registered Exchange Offer and in the Private Exchange will accrue from the last interest payment date on which interest was paid on the Initial Securities surrendered in exchange therefor or, if no interest has been paid on the Initial Securities, from the date of original issue of the Initial Securities.

Each Holder participating in the Registered Exchange Offer shall be required to represent to the Company that at the time of the consummation of the Registered Exchange Offer (i) any Exchange Securities received by such Holder will be acquired in the ordinary course of business, (ii) such Holder will have no arrangements or understanding with any person to participate in the distribution of the Securities or the Exchange Securities within the meaning of the Securities Act, (iii) such Holder is not an “affiliate,” as defined in Rule 405 of the Securities Act, of the Company or if it is an affiliate, such Holder will comply with the registration and prospectus delivery requirements of the Securities Act to the extent applicable, (iv) if such Holder is not a broker-dealer, that it is not engaged in, and does not intend to engage in, the distribution of the Exchange Securities and (v) if such Holder is a broker-dealer, that it will receive Exchange Securities for its own account in exchange for Initial Securities that were acquired as a result of market-making activities or other trading activities and that it will be required to acknowledge that it will deliver a prospectus in connection with any resale of such Exchange Securities.

Notwithstanding any other provisions hereof, the Company will ensure that (i) any Exchange Offer Registration Statement and any amendment thereto and any prospectus forming part thereof and any supplement thereto complies in all material respects with the Securities Act and the rules and regulations thereunder, (ii) any Exchange Offer Registration Statement and any amendment thereto does not, when it becomes effective, contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading and (iii) any prospectus forming part of any Exchange Offer Registration Statement, and any supplement to such prospectus, does not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.

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2.     Shelf Registration.  If, (i) because of any change in law or in applicable interpretations thereof by the staff of the Commission, the Company is not permitted to effect a Registered Exchange Offer, as contemplated by Section 1 hereof, as of the Exchange Offer Filing Deadline, (ii) the Registered Exchange Offer is not consummated by the 310th day following the Issue Date (such day being the “Exchange Offer Consummation Deadline”), (iii) any Initial Purchaser so requests in writing during the 20 business days following consummation of the Exchange Offer (such period being a “Shelf Registration Notice Period”) with respect to the Initial Securities (or the Private Exchange Securities) not eligible to be exchanged for Exchange Securities in the Registered Exchange Offer and held by it following consummation of the Registered Exchange Offer or (iv) any Holder (other than an Exchanging Dealer) notifies the Company in writing during the Shelf Registration Notice Period that, based upon an opinion of counsel reasonably satisfactory to the Company, it was not eligible to participate in the Registered Exchange Offer or, if such Holder participates in the Registered Exchange Offer, such Holder will not receive freely tradeable Exchange Securities on the date of the exchange, the Company shall take the following actions:

(a)     The Company shall, at its cost, as promptly as practicable (but in no event more than 90 days after the Exchange Offer Filing Deadline (in the case of (i) above), the Exchange Offer Consummation Deadline (in the case of (ii) above) or the expiration of the Shelf Registration Notice Period (in the case of (iii) and (iv) above) (each such day being a “Shelf Registration Filing Deadline”)), file with the Commission and thereafter shall use its commercially reasonable efforts to cause to be declared effective a registration statement (the “Shelf Registration Statement” and, together with the Exchange Offer Registration Statement, a “Registration Statement”) on an appropriate form under the Securities Act relating to the offer and sale of the Transfer Restricted Securities (as defined in Section 6 hereof) by the Holders thereof from time to time in accordance with the methods of distribution set forth in the Shelf Registration Statement and Rule 415 under the Securities Act (hereinafter, the “Shelf Registration”); provided, however, that no Holder (other than an Initial Purchaser) shall be entitled to have the Securities held by it covered by such Shelf Registration Statement unless such Holder agrees in writing to be bound by all the provisions of this Agreement applicable to such Holder; provided, further, that, to the extent required by the Securities Act, the Company shall also register the Mortgage Bonds in the Shelf Registration Statement and provided, further, that, to the extent the Company was obligated to file a Shelf Registration Statement solely because it did not consummate the Registered Exchange Offer in a timely fashion by the Exchange Offer Consummation Deadline as described in (ii) above, the Company need not file or continue the filing of any such Shelf Registration Statement if the Exchange Offer is consummated subsequent to the Exchange Offer Consummation Deadline (it being understood that, to the extent the Company is or was obligated to file a Shelf Registration Statement for any other purpose, such obligation will remain binding).

(b)     The Company shall use its commercially reasonable efforts to keep the Shelf Registration Statement continuously effective in order to permit the prospectus included therein to be lawfully delivered by the Holders of the relevant Securities, for a period of two years (or for such longer period if extended pursuant to Section 3(j) below) from the date of its effectiveness or such shorter period that will terminate when all the Securities covered by the Shelf Registration Statement (i) have been sold pursuant thereto or (ii) are distributed to the public pursuant to Rule 144 under the Securities Act, or any successor rule thereof, are saleable pursuant to Rule 144(k) under the Securities Act, or any successor rule thereof, or are otherwise no longer restricted securities (as defined in Rule 144 under the Securities Act, or any successor rule thereof) (the “Shelf Registration Termination Date”).  The Company shall be deemed not to have used its commercially reasonable efforts to keep the Shelf Registration Statement effective during the requisite period if it voluntarily takes any action that would result in Holders of Securities covered thereby not being able to offer and sell such Securities during that period, unless (i) such action is required by applicable law, (ii) the Company complies with this Agreement or (iii) such action is taken by the Company in good faith and for valid business reasons (not including avoidance by the Company of its obligations hereunder), including the acquisition or divestiture of assets, so long as such action does not result in a lapse in the effectiveness of the Shelf Registration Statement of more than 45 consecutive days or 60 days within a twelve month period and the Company promptly thereafter complies with the requirements of Section 3(j) hereof, if applicable.

(c)     Notwithstanding any other provisions of this Agreement to the contrary, the Company shall cause the Shelf Registration Statement and the related prospectus and any amendment or supplement

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thereto, as of the effective date of the Shelf Registration Statement, amendment or supplement, (i) to comply in all material respects with the applicable requirements of the Securities Act and the rules and regulations of the Commission and (ii) not to contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein (in the case of any prospectus, in light of the circumstances under which they were made), not misleading.

No Holder of Transfer Restricted Securities may include any of its Transfer Restricted Securities in any Shelf Registration Statement pursuant to this Agreement unless and until such Holder furnished to the Company in writing, within 10 days after receipt of a written request therefor, the information specified in Item 507 or 508 of Regulation S-K, as applicable, of the Securities Act for use in connection with any Shelf Registration Statement or Prospectus or preliminary prospectus included therein.  Each selling Holder agrees to promptly furnish additional information required to be disclosed in order to make the information previously furnished to the Company by such Holder not materially misleading.

3.     Registration Procedures.  In connection with any Shelf Registration contemplated by Section 2 hereof and, to the extent applicable, any Registered Exchange Offer contemplated by Section 1 hereof, the following provisions shall apply:

(a)     The Company shall (i) furnish to each Initial Purchaser, prior to the filing thereof with the Commission, a copy of the Registration Statement and each amendment thereof and each supplement, if any, to the prospectus included therein and, in the event that an Initial Purchaser (with respect to any portion of an unsold allotment from the original offering) is participating in the Registered Exchange Offer or the Shelf Registration Statement, the Company shall use its commercially reasonable efforts to reflect in each such document, when so filed with the Commission, such comments as such Initial Purchaser reasonably may propose; (ii) include the information set forth in Annex A hereto on the cover, in Annex B hereto in the “Exchange Offer Procedures” section and the “Purpose of the Exchange Offer” section and in Annex C hereto in the “Plan of Distribution” section of the prospectus forming a part of the Exchange Offer Registration Statement and include the information set forth in Annex D hereto in the Letter of Transmittal delivered pursuant to the Registered Exchange Offer; (iii) if requested by an Initial Purchaser, include the information required by Items 507 or 508 of Regulation S-K under the Securities Act, as applicable, in the prospectus forming a part of the Exchange Offer Registration Statement; (iv) include within the prospectus contained in the Exchange Offer Registration Statement a section entitled “Plan of Distribution,” reasonably acceptable to the Initial Purchasers, which shall contain a summary statement of the positions taken or policies made by the staff of the Commission with respect to the potential “underwriter” status of any broker-dealer that is the beneficial owner (as defined in Rule 13d-3 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) of Exchange Securities received by such broker-dealer in the Registered Exchange Offer (a “Participating Broker-Dealer”), whether such positions or policies have been publicly disseminated by the staff of the Commission or such positions or policies, in the reasonable judgment of the Initial Purchasers based upon advice of counsel (which may be in-house counsel), represent the prevailing views of the staff of the Commission; and (v) in the case of a Shelf Registration Statement, include the names of the Holders, who propose to sell Securities pursuant to the Shelf Registration Statement, as selling securityholders.

(b)     The Company shall give written notice to the Initial Purchasers, the Holders of the Securities and any Participating Broker-Dealer from whom the Company has received prior written notice that it will be a Participating Broker-Dealer in the Registered Exchange Offer (which notice pursuant to clauses (ii)-(v) hereof shall be accompanied by an instruction to suspend the use of the prospectus until the requisite changes have been made):

(i)            when the Registration Statement or any amendment thereto has been filed with the Commission and when the Registration Statement or any post-effective amendment thereto has become effective;

(ii)           of any request by the Commission for amendments or supplements to the Registration Statement or the prospectus included therein or for additional information;

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(iii)          of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or the initiation of any proceedings for that purpose;

(iv)          of the receipt by the Company or its legal counsel of any notification with respect to the suspension of the qualification of the Securities for sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose; and

(v)           of the happening of any event that requires the Company to make changes in the Registration Statement or the prospectus in order that the Registration Statement or the prospectus do not contain an untrue statement of a material fact nor omit to state a material fact required to be stated therein or necessary to make the statements therein (in the case of the prospectus, in light of the circumstances under which they were made) not misleading.

(c)     The Company shall use its commercially reasonable effort to obtain the withdrawal at the earliest possible time, of any order suspending the effectiveness of the Registration Statement.

(d)     The Company shall furnish to each Holder of Securities included within the coverage of the Shelf Registration, without charge, at least one copy of the Shelf Registration Statement and any post-effective amendment thereto, including financial statements and schedules, and, if the Holder so requests in writing, all exhibits thereto (including those, if any, incorporated by reference).

(e)     The Company shall deliver to each Exchanging Dealer and each Initial Purchaser, and to any other Holder who so requests, without charge, at least one copy of the Exchange Offer Registration Statement and any post-effective amendment thereto, including financial statements and schedules, and, if any Initial Purchaser or any such Holder requests, all exhibits thereto (including those incorporated by reference).

(f)      The Company shall, during the Shelf Registration Period, deliver to each Holder of Securities included within the coverage of the Shelf Registration, without charge, as many copies of the prospectus (including each preliminary prospectus) included in the Shelf Registration Statement and any amendment or supplement thereto as such person may reasonably request. The Company consents, subject to the provisions of this Agreement, to the use of the prospectus or any amendment or supplement thereto by each of the selling Holders of the Securities in connection with the offering and sale of the Securities covered by the prospectus, or any amendment or supplement thereto, included in the Shelf Registration Statement.

(g)     The Company shall deliver to each Initial Purchaser, any Exchanging Dealer, any Participating Broker-Dealer and such other persons required to deliver a prospectus following the Registered Exchange Offer, without charge, as many copies of the final prospectus included in the Exchange Offer Registration Statement and any amendment or supplement thereto as such persons may reasonably request.  The Company consents, subject to the provisions of this Agreement, to the use of the prospectus or any amendment or supplement thereto by any Initial Purchaser, if necessary, any Participating Broker-Dealer and such other persons required to deliver a prospectus following the Registered Exchange Offer in connection with the offering and sale of the Exchange Securities covered by the prospectus, or any amendment or supplement thereto, included in such Exchange Offer Registration Statement.

(h)     Prior to any public offering of the Securities, pursuant to any Registration Statement, the Company shall use its commercially reasonable effort to register or qualify or cooperate with the Holders of the Securities included therein and their respective counsel in connection with the registration or qualification of the Securities for offer and sale under the securities or “blue sky” laws of such states of the United States as any Holder of the Securities reasonably requests in writing and do any and all other acts or things necessary or advisable to enable the offer and sale in such jurisdictions of the Securities covered by such Registration Statement; provided, however, that the Company shall not be required to (i) qualify generally to do business or as a securities dealer in any jurisdiction where it is not then so qualified or (ii) take any action which would subject it to general service of process or to taxation in any jurisdiction where it is not then so subject.

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(i)      The Company shall cooperate with the Holders of the Securities to facilitate the timely preparation and delivery of certificates representing the Securities to be sold pursuant to any Registration Statement free of any restrictive legends (to the extent permitted by the Securities Act) and in such denominations and registered in such names as the Holders may request a reasonable period of time prior to sales of the Securities pursuant to such Registration Statement.

(j)      Upon the occurrence of any event contemplated by paragraphs (ii) through (v) of Section 3(b) above during the period for which the Company is required to maintain an effective Registration Statement, the Company shall promptly prepare and file a post-effective amendment to the Registration Statement or a supplement to the related prospectus and any other required document so that, as thereafter delivered to Holders of the Securities or purchasers of Securities, the prospectus will not contain an untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein (in the case of any prospectus, in light of the circumstances under which they were made) not misleading.  If the Company notifies the Initial Purchasers, the Holders of the Securities and any known Participating Broker-Dealer in accordance with paragraphs (ii) through (v) of Section 3(b) above to suspend the use of the prospectus until the requisite changes to the prospectus have been made, then the Initial Purchasers, the Holders of the Securities and any such Participating Broker-Dealers shall suspend use of such prospectus, and the period of effectiveness of the Shelf Registration Statement provided for in Section 2(b) above and the Exchange Offer Registration Statement provided for in Section 1 above shall each be extended by the number of days from and including the date of the giving of such notice to and including the date when the Initial Purchasers, the Holders of the Securities and any known Participating Broker-Dealer shall have received such amended or supplemented prospectus pursuant to this Section 3(j).  Each Holder receiving a suspension notice shall either (i) destroy any prospectuses, other than permanent file copies, then in such Holder’s possession which have been replaced by the Company with more recently dated prospectuses or (ii) deliver to the Company (at the Company’s expense) all copies, other than permanent file copies, then in such Holder’s possession of the prospectus covering such Transfer Restricted Securities that was current at the time of receipt of the suspension notice.

(k)     Not later than the effective date of the applicable Registration Statement, the Company will provide a CUSIP number for the Initial Securities, the Exchange Securities or the Private Exchange Securities, as the case may be, and provide the applicable trustee with printed certificates for the Initial Securities, the Exchange Securities or the Private Exchange Securities, as the case may be, in a form eligible for deposit with The Depository Trust Company.

(l)      The Company will comply with all rules and regulations of the Commission to the extent and so long as they are applicable to the Registered Exchange Offer or the Shelf Registration and will make generally available to its security holders (or otherwise provide in accordance with Section 11(a) of the Securities Act) an earnings statement (which need not be audited) satisfying the provisions of Section 11(a) of the Securities Act, no later than 45 days after the end of a 12-month period (or 90 days, if such period is a fiscal year) beginning with the first month of the Company’s first fiscal quarter commencing after the effective date of the Registration Statement, which statement shall cover such 12-month period.

(m)    The Company shall cause the Indenture and, to the extent required by the Securities Act, the Mortgages (as such term is defined in the Purchase Agreement) to be qualified under the Trust Indenture Act of 1939, as amended, in a timely manner and containing such changes, if any, as shall be necessary for such qualification.  In the event that such qualification would require the appointment of a new trustee under the Indenture or, as required by the Securities Act, the Mortgages, the Company shall appoint a new trustee thereunder pursuant to the applicable provisions of the Indenture or the Mortgages.

(n)     The Company may require each Holder of Securities to be sold pursuant to the Shelf Registration Statement to furnish to the Company such information regarding the Holder and the distribution of the Securities as the Company may from time to time reasonably require for inclusion in the Shelf Registration Statement, and the Company may exclude from such registration the Securities of any Holder that unreasonably fails to furnish such information within a reasonable time after receiving such request.

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(o)     In the case of any Shelf Registration, the Company shall enter into such customary agreements (including, if requested, an underwriting agreement in customary form) and take all such other action, if any, as any Holder of the Securities shall reasonably request in order to facilitate the disposition of the Securities pursuant to any Shelf Registration.

(p)     In the case of any Shelf Registration, the Company shall (i) make reasonably available for inspection by the Holders of the Securities, any underwriter participating in any disposition pursuant to the Shelf Registration Statement and any attorney, accountant or other agent retained by the Holders of the Securities or any such underwriter all relevant financial and other records, pertinent corporate documents and properties of the Company and (ii) cause the Company’s officers, directors, employees, accountants and auditors to supply all relevant information reasonably requested by the Holders of the Securities or any such underwriter, attorney, accountant or agent in connection with the Shelf Registration Statement, in each case, as shall be reasonably necessary to enable such persons, to conduct a reasonable investigation within the meaning of Section 11 of the Securities Act; provided, however, that the foregoing inspection and information gathering shall be coordinated on behalf of the Initial Purchasers by you and on behalf of the other parties, by one counsel designated by and on behalf of such other parties as described in Section 4 hereof; provided, however, that any non-public information shall be kept confidential by the Holders or any underwriter, attorney, accountant or agent, unless such disclosure is required by law or becomes available to the public generally through a third party without an accompanying obligation of confidentiality other than as a result of a disclosure of such information by any such Holder, underwriter, attorney, accountant or agent.

(q)     In the case of any Shelf Registration, the Company, if requested by any Holder of Securities covered thereby, shall cause (i) its counsel (which may be in-house counsel) to deliver an opinion and updates thereof relating to the Securities in customary form addressed to such Holders and the managing underwriters, if any, thereof and dated, in the case of the initial opinion, the effective date of such Shelf Registration Statement (it being agreed that the matters to be covered by such opinion shall include, without limitation, the due incorporation and good standing of the Company and its subsidiaries; the qualification of the Company and its subsidiaries to transact business as foreign corporations; the due authorization, execution and delivery of the relevant agreement of the type referred to in Section 3(o) hereof; the due authorization, execution, authentication and issuance, and the validity and enforceability, of the applicable Securities and the Collateral Bonds; the absence of material legal or governmental proceedings involving the Company and its subsidiaries; the absence of governmental approvals required to be obtained in connection with the Shelf Registration Statement, the offering and sale of the applicable Securities and the issuance and delivery of the Collateral Bonds, or any agreement of the type referred to in Section 3(o) hereof; the compliance as to form of such Shelf Registration Statement and any documents incorporated by reference therein and of the Indenture and the Mortgages with the requirements of the Securities Act and the Trust Indenture Act, respectively; and, as of the date of the opinion and as of the effective date of the Shelf Registration Statement or most recent post-effective amendment thereto, as the case may be, the absence from such Shelf Registration Statement and the prospectus included therein, as then amended or supplemented, and from any documents incorporated by reference therein of an untrue statement of a material fact or the omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading (in the case of any such documents, in the light of the circumstances existing at the time that such documents were filed with the Commission under the Exchange Act); (ii) its officers to execute and deliver all customary documents and certificates and updates thereof reasonably requested by any underwriters of the applicable Securities and (iii) its independent public registered accounting firm to provide to the selling Holders of the applicable Securities and any underwriter therefor a comfort letter in customary form and covering matters of the type customarily covered in comfort letters in connection with primary underwritten offerings, subject to receipt of appropriate documentation as contemplated, and only if permitted, by Statement of Auditing Standards No. 72.

(r)      In the case of the Registered Exchange Offer, if reasonably requested by any Initial Purchaser or any known Participating Broker-Dealer, the Company shall cause (i) its counsel to deliver to such Initial Purchaser or such Participating Broker-Dealer signed opinions in the forms set forth in Sections 6(c) and (d) of the Purchase Agreement with such changes as are customary in connection with the preparation of a

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Registration Statement and (ii) its independent public accountants to deliver to such Initial Purchaser or such Participating Broker-Dealer a comfort letter, in customary form, meeting the requirements as to the substance thereof as set forth in Section 6(a) of the Purchase Agreement, with appropriate date changes.

(s)     If a Registered Exchange Offer or a Private Exchange is to be consummated, upon delivery of the Initial Securities by Holders to the Company (or to such other Person as directed by the Company) in exchange for the Exchange Securities or the Private Exchange Securities, as the case may be, the Company shall mark, or caused to be marked, on the Initial Securities so exchanged that such Initial Securities are being canceled in exchange for the Exchange Securities or the Private Exchange Securities, as the case may be; in no event shall the Initial Securities be marked as paid or otherwise satisfied.

(t)      The Company will use its commercially reasonable efforts to (a) if the Initial Securities have been rated prior to the initial sale of such Initial Securities, confirm such ratings will apply to the Securities covered by a Registration Statement, or (b) if the Initial Securities were not previously rated, cause the Securities covered by a Registration Statement to be rated with up to two appropriate rating agencies, if so requested by Holders of a majority in aggregate principal amount of Securities covered by such Registration Statement, or by the managing underwriters, if any, in the case of a Shelf Registration for an underwritten offering.

(u)     In the event that any broker-dealer registered under the Exchange Act shall underwrite any Securities or participate as a member of an underwriting syndicate or selling group or “assist in the distribution” (within the meaning of the Conduct Rules (the “Rules”) of the National Association of Securities Dealers, Inc. (“NASD”)) thereof, whether as a Holder of such Securities or as an underwriter, a placement or sales agent or a broker or dealer in respect thereof, or otherwise, the Company will assist such broker-dealer in complying with the requirements of such Rules, including, without limitation, by (i) if such Rules, including Rule 2720, shall so require, engaging a “qualified independent underwriter” (as defined in Rule 2720) to participate in the preparation of the Registration Statement relating to such Securities, to exercise usual standards of due diligence in respect thereto and, if any portion of the offering contemplated by such Registration Statement is an underwritten offering or is made through a placement or sales agent, to recommend the yield of such Securities, (ii) indemnifying any such qualified independent underwriter to the extent of the indemnification of underwriters provided in Section 5 hereof and (iii) providing such information to such broker-dealer as may be required in order for such broker-dealer to comply with the requirements of the Rules.

(v)     The Company shall use its commercially reasonable efforts to take all other steps necessary to effect the registration of the Securities covered by a Registration Statement contemplated hereby.

4.     Registration Expenses.  The Company shall bear all fees and expenses incurred in connection with the performance of its obligations under Sections 1 through 3 hereof  and shall reimburse the Initial Purchasers and the Holders of Transfer Restricted Securities who are tendering Initial Securities in the Registered Exchange Offer and/or selling or reselling Securities pursuant to the “Plan of Distribution” contained in the Exchange Offer Registration Statement or the Shelf Registration Statement, as applicable, for the reasonable fees and expenses, if any, of not more than one counsel, who shall be Dewey Ballantine LLP unless another firm shall be chosen by the Holders of a majority in principal amount of the Initial Securities covered thereby, whether or not the Registered Exchange Offer or a Shelf Registration is filed or becomes effective.

5.     Indemnification.  (a)  The Company agrees to indemnify and hold harmless each Holder of the Securities, any Participating Broker-Dealer and each person, if any, who controls such Holder or such Participating Broker-Dealer within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act (each Holder, any Participating Broker-Dealer and such controlling persons are referred to collectively as the “Indemnified Parties”) from and against any losses, claims, damages or liabilities, joint or several, or any actions in respect thereof (including, but not limited to, any losses, claims, damages, liabilities or actions relating to purchases and sales of the Securities) to which each Indemnified Party may become subject under the Securities Act, the Exchange Act or otherwise, insofar as such losses, claims, damages, liabilities or actions arise out of or are based upon any untrue statement or alleged untrue statement of a material fact contained in a Registration Statement or prospectus or in any amendment or supplement thereto or in any preliminary prospectus relating to a Shelf Registration, or arise out of,

9

or are based upon, the omission or alleged omission to state therein a material fact required to be stated therein or necessary in order to make the statements therein (in the case of any prospectus, in light of the circumstances under which they were made) not misleading, and shall reimburse, as incurred, the Indemnified Parties for any legal or other expenses reasonably incurred by them in connection with investigating or defending any such loss, claim, damage, liability or action in respect thereof; provided, however, that (i) the Company shall not be liable in any such case to the extent that such loss, claim, damage or liability arises out of or is based upon any untrue statement or alleged untrue statement or omission or alleged omission made in a Registration Statement or prospectus or in any amendment or supplement thereto or in any preliminary prospectus relating to a Shelf Registration in reliance upon and in conformity with written information pertaining to such Holder and furnished to the Company by or on behalf of such Holder specifically for inclusion therein and (ii) with respect to any untrue statement or omission or alleged untrue statement or omission made in any preliminary prospectus, the indemnity agreement contained in this subsection (a) shall not inure to the benefit of any Holder or Participating Broker-Dealer from whom the person asserting any such losses, claims, damages or liabilities purchased the Securities concerned, to the extent that a prospectus relating to such Securities was required to be delivered by such Holder or Participating Broker-Dealer under the Securities Act in connection with such purchase and any such loss, claim, damage or liability of such Holder or Participating Broker-Dealer results from the fact that there was not sent or given to such person, at or prior to the written confirmation of the sale of such Securities to such person, a copy of the final prospectus if the Company had previously furnished copies thereof to such Holder or Participating Broker-Dealer; provided further, however, that this indemnity agreement will be in addition to any liability which the Company may otherwise have to such Indemnified Party.  The Company shall also indemnify underwriters, their officers and directors and each person who controls such underwriters within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act to the same extent as provided above with respect to the indemnification of the Holders of the Securities if requested by such Holders in the case of a Shelf Registration for an underwritten offering; provided, to the extent such Holders so request indemnification for the underwriters, that each underwriter agrees to indemnify, severally and not jointly, the Company, its directors and officers and each person, if any, who controls the Company within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act to the same extent as provided in Section (b) below with respect to written information pertaining to such underwriter and furnished to the Company by or on behalf of such underwriter specifically for inclusion in such Shelf Registration Statement or prospectus.

(b)     Each Holder of the Securities, severally and not jointly, will indemnify and hold harmless the Company and each person, if any, who controls the Company within the meaning of Section 15 the Securities Act or Section 20 of the Exchange Act from and against any losses, claims, damages or liabilities or any actions in respect thereof, to which the Company or any such controlling person may become subject under the Securities Act, the Exchange Act or otherwise, insofar as such losses, claims, damages, liabilities or actions arise out of or are based upon any untrue statement or alleged untrue statement of a material fact contained in a Registration Statement or prospectus or in any amendment or supplement thereto or in any preliminary prospectus relating to a Shelf Registration, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary in order to make the statements therein (in the case of any prospectus, in light of the circumstances under which they were made) not misleading, but in each case only to the extent that the untrue statement or omission or alleged untrue statement or omission was made in reliance upon and in conformity with written information pertaining to such Holder and furnished to the Company by or on behalf of such Holder specifically for inclusion therein; and, subject to the limitation set forth immediately preceding this clause, shall reimburse, as incurred, the Company for any legal or other expenses reasonably incurred by the Company or any such controlling person in connection with investigating or defending any loss, claim, damage, liability or action in respect thereof.  This indemnity agreement will be in addition to any liability which such Holder may otherwise have to the Company or any of its controlling persons.

(c)     Promptly after receipt by an indemnified party under this Section 5 of notice of the commencement of any action or proceeding (including a governmental investigation), such indemnified party will, if a claim in respect thereof is to be made against the indemnifying party under this Section 5, notify the indemnifying party of the commencement thereof; but the failure to notify the indemnifying party shall not relieve the indemnifying party from any liability that it may have under subsection (a) or (b) above except to the extent that it has been materially prejudiced by such failure; and provided further that the failure to notify the indemnifying party shall not relieve it from any liability that it may have to an indemnified party otherwise than under subsection  (a) or (b) above.  In case any such action is brought against any indemnified party, and it notifies the indemnifying party of

10

the commencement thereof, the indemnifying party will be entitled to participate therein and, to the extent that it may wish, jointly with any other indemnifying party similarly notified, to assume the defense thereof, with counsel reasonably satisfactory to such indemnified party, and after notice from the indemnifying party to such indemnified party of its election so to assume the defense thereof the indemnifying party will not be liable to such indemnified party under this Section 5 for any legal or other expenses, other than reasonable costs of investigation, subsequently incurred by such indemnified party in connection with the defense thereof.  No indemnifying party shall, without the prior written consent of the indemnified party, effect any settlement of any pending or threatened action in respect of which any indemnified party is or could have been a party and indemnity could have been sought hereunder by such indemnified party unless such settlement (i) includes an unconditional release of such indemnified party from all liability on any claims that are the subject matter of such action, and (ii) does not include a statement as to or an admission of fault, culpability or a failure to act by or on behalf of any indemnified party.

(d)     If the indemnification provided for in this Section 5 is unavailable or insufficient to hold harmless an indemnified party under subsections (a) or (b) above, then each indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of the losses, claims, damages or liabilities (or actions in respect thereof) referred to in subsection (a) or (b) above (i) in such proportion as is appropriate to reflect the relative benefits received by the indemnifying party or parties on the one hand and the indemnified party on the other from the exchange of the Securities, pursuant to the Registered Exchange Offer, or (ii) if the allocation provided by the foregoing clause (i) is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of the indemnifying party or parties on the one hand and the indemnified party on the other in connection with the statements or omissions that resulted in such losses, claims, damages or liabilities (or actions in respect thereof) as well as any other relevant equitable considerations.  The relative fault of the parties shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company on the one hand or such Holder or such other indemnified party, as the case may be, on the other, and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.  The amount paid by an indemnified party as a result of the losses, claims, damages or liabilities referred to in the first sentence of this subsection (d) shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any action or claim which is the subject of this subsection (d).  Notwithstanding any other provision of this Section 5(d), the Holders of the Securities shall not be required to contribute any amount in excess of the amount by which the net proceeds received by such Holders from the sale of the Securities pursuant to a Registration Statement exceeds the amount of damages which such Holders have otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission.  No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation.  For purposes of this paragraph (d), each person, if any, who controls such indemnified party within the meaning of the Securities Act or the Exchange Act shall have the same rights to contribution as such indemnified party and each person, if any, who controls the Company within the meaning of the Securities Act or the Exchange Act shall have the same rights to contribution as the Company.

(e)     The agreements contained in this Section 5 shall survive the sale of the Securities pursuant to a Registration Statement and shall remain in full force and effect, regardless of any termination or cancellation of this Agreement or any investigation made by or on behalf of any indemnified party.

6.     Additional Interest Under Certain Circumstances.  (a)  Additional interest (the “Additional Interest”) with respect to the Initial Securities shall be assessed as follows if any of the following events occur (each such event in clauses (i) through (iii) below a “Registration Default”):

(i)            If on or prior to the Exchange Offer Filing Deadline, the Exchange Offer Registration Statement has not been filed with the Commission;

(ii)           If on or prior to the Shelf Registration Filing Deadline, a Shelf Registration Statement has not been filed with the Commission;

11

(iii)          If on or prior to the Exchange Offer Consummation Deadline, the Registered Exchange Offer is not consummated;

(iv)          If on or prior to 90 days following the Shelf Registration Filing Deadline (such day being the “Shelf Registration Effectiveness Deadline”) in the event a Shelf Registration is required in lieu of the Registered Exchange Offer pursuant to Section 2 hereof, the Shelf Registration Statement has not been declared effective by the Commission; or

(v)           If after either the Exchange Offer Registration Statement or the Shelf Registration Statement is declared effective (A) such Registration Statement thereafter ceases to be effective; or (B) such Registration Statement or the related prospectus ceases to be usable (except as permitted in paragraph (b)) in connection with resales of Transfer Restricted Securities during any periods after the Exchange Offer Effectiveness Deadline or Shelf Registration Effectiveness Deadline, as the case may be, but prior to the consummation of the Exchange Offer or the Shelf Registration Termination Date, as the case may be, because either (1) any event occurs as a result of which the related prospectus forming part of such Registration Statement would include any untrue statement of a material fact or omit to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, or (2) it shall be necessary to amend such Registration Statement or supplement the related prospectus, to comply with the Securities Act or the Exchange Act or the respective rules thereunder.

Additional Interest shall accrue on the Initial Securities over and above the interest set forth in the title of the Securities from and including the date on which any such Registration Default shall occur to but excluding the date on which all such Registration Defaults have been cured, at a rate of 0.25% per annum (the “Additional Interest Rate”) for the first 90-day period immediately following the occurrence of such Registration Default.  The Additional Interest Rate shall increase by an additional 0.25% per annum with respect to each subsequent 90-day period until all Registration Defaults have been cured, up to a maximum Additional Interest Rate of 1.0% per annum.

(b)     A Registration Default referred to in Section 6(a)( v)(B) hereof shall be deemed not to have occurred and be continuing in relation to a Shelf Registration Statement or the related prospectus if (i) such Registration Default has occurred solely as a result of (x) the filing of a post-effective amendment to such Shelf Registration Statement to incorporate annual audited financial information with respect to the Company where such post-effective amendment is not yet effective and needs to be declared effective to permit Holders to use the related prospectus or (y) other material events, with respect to the Company that would need to be described in such Shelf Registration Statement or the related prospectus and (ii) in the case of clause (y), the Company is proceeding promptly and in good faith to amend or supplement such Shelf Registration Statement and related prospectus to describe such events; provided, however, that in any case if such Registration Default occurs for a continuous period in excess of 60 days, Additional Interest shall be payable in accordance with the above paragraph from the day such Registration Default occurs until such Registration Default is cured.

(c)     Any amounts of Additional Interest due pursuant to clause (i), (ii), (iii), (iv) or (v) of Section 6(a) above will be payable in cash on the regular interest payment dates with respect to the Initial Securities. The amount of Additional Interest will be determined by multiplying the Additional Interest rate by the principal amount of the Initial Securities, multiplied by a fraction, the numerator of which is the number of days such Additional Interest rate was applicable during such period (determined on the basis of a 360-day year comprised of twelve 30-day months), and the denominator of which is 360.

(d)     “Transfer Restricted Securities” means each Security until the earlier to occur of (i) the date on which such Transfer Restricted Security has been exchanged by a person other than a broker-dealer for a freely transferable Exchange Security in the Registered Exchange Offer, (ii) following the exchange by a broker-dealer in the Registered Exchange Offer of an Initial Security for an Exchange Security, the date on which such Exchange Security is sold to a purchaser who receives from such broker-dealer on or prior to the date of such sale a copy of the prospectus contained in the Exchange Offer Registration Statement, (iii) the date on which such Initial Security has been effectively registered under the Securities Act and disposed of in accordance with the Shelf Registration

12

Statement or (iv) the date on which such Initial Security is distributed to the public pursuant to Rule 144 under the Securities Act or is saleable pursuant to Rule 144(k) under the Securities Act.

7.     Rules 144 and 144A.  The Company shall use its commercially reasonable efforts to file the reports required to be filed by it under the Securities Act and the Exchange Act in a timely manner and, if at any time the Company is not required to file such reports, it will, upon the request of any Holder of Initial Securities, make publicly available other information so long as necessary to permit sales of their securities pursuant to Rules 144 and 144A.  The Company covenants that it will take such further action as any Holder of Initial Securities may reasonably request, all to the extent required from time to time to enable such Holder to sell Initial Securities without registration under the Securities Act within the limitation of the exemptions provided by Rules 144 and 144A (including the requirements of Rule 144A(d)(4)).  The Company will provide a copy of this Agreement to prospective purchasers of Initial Securities identified to the Company by the Initial Purchasers upon request.  Upon the request of any Holder of Initial Securities, the Company shall deliver to such Holder a written statement as to whether it has complied with such requirements. Notwithstanding the foregoing, nothing in this Section 7 shall be deemed to require the Company to register any of its securities pursuant to the Exchange Act.

8.     Underwritten Registrations.  If any of the Transfer Restricted Securities covered by any Shelf Registration are to be sold in an underwritten offering, the investment banker or investment bankers and manager or managers that will administer the offering (“Managing Underwriters”) will be selected by the Holders of a majority in aggregate principal amount of such Transfer Restricted Securities to be included in such offering and approved by the Company.

No person may participate in any underwritten registration hereunder unless such person (i) agrees to sell such person’s Transfer Restricted Securities on the basis reasonably provided in any underwriting arrangements approved by the persons entitled hereunder to approve such arrangements and (ii) completes and executes all questionnaires, powers of attorney, indemnities, underwriting agreements and other documents reasonably required under the terms of such underwriting arrangements.

9.     Miscellaneous.

(a)     Amendments and Waivers.  The provisions of this Agreement may not be amended, modified or supplemented, and waivers or consents to departures from the provisions hereof may not be given, except by the Company and the written consent of the Holders of a majority in principal amount of the Securities affected by such amendment, modification, supplement, waiver or consents.

(b)     Notices.  All notices and other communications provided for or permitted hereunder shall be made in writing by hand delivery, first-class mail, facsimile transmission, or air courier which guarantees overnight delivery:

(1)   if to a Holder of the Securities, at the most current address given by such Holder to the Company.

(2)   if to the Initial Purchasers;

Credit Suisse First Boston LLC

Eleven Madison Avenue

New York, NY 10010-3629

Fax No.:  (212) 325-8278

Attention:  Transactions Advisory Group

Lehman Brothers Inc.

745 Seventh Avenue

New York, NY 10019

Fax No.:  (212) 526-0943

Attention:  Debt Capital Markets, Power Group

13

with a copy to:

Dewey Ballantine LLP

1301 Avenue of the Americas

New York, NY  10019

Fax No.:  (212) 259-6333

Attention:  Peter K. O’Brien

(3)   if to the Company, at its address as follows:

NorthWestern Corporation

125 S. Dakota Avenue

Sioux Falls, SD  57104-6403

Fax No.:  (605) 978-2840

Attention:  Treasurer

with a copy to:

Paul, Hastings, Janofsky & Walker LLP

55 Second Street, 24th Floor

San Francisco, CA  94105

Fax No.:  (415) 856-7147

Attention:  Thomas R. Pollock

All such notices and communications shall be deemed to have been duly given:  at the time delivered by hand, if personally delivered; three business days after being deposited in the mail, postage prepaid, if mailed; when receipt is acknowledged by recipient’s facsimile machine operator, if sent by facsimile transmission; and on the day delivered, if sent by overnight air courier guaranteeing next day delivery.

(c)     No Inconsistent Agreements.  The Company has not, as of the date hereof, entered into, nor shall it, on or after the date hereof, enter into, any agreement with respect to its securities that is inconsistent with the rights granted to the Holders herein or otherwise conflicts with the provisions hereof.

(d)     Successors and Assigns.  This Agreement shall be binding upon the Company and its successors and assigns.

(e)     Counterparts.  This Agreement may be executed in any number of counterparts and by the parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement.

(f)      Headings.  The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof.

(g)     Governing Law.  THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS.

(h)     Severability.  If any one or more of the provisions contained herein, or the application thereof in any circumstance, is held invalid, illegal or unenforceable, the validity, legality and enforceability of any such provision in every other respect and of the remaining provisions contained herein shall not be affected or impaired thereby.

(i)      Securities Held by the Company.  Whenever the consent or approval of Holders of a specified percentage of principal amount of Securities is required hereunder, Securities held by the Company or its affiliates (other than subsequent Holders of Securities if such subsequent Holders are deemed to be

14

affiliates solely by reason of their holdings of such Securities) shall not be counted in determining whether such consent or approval was given by the Holders of such required percentage.

(j)      Submission to Jurisdiction; Waiver of Immunities.  The Company hereby submits to the exclusive jurisdiction of the federal and state courts in the Borough of Manhattan in The City of New York in any suit or proceeding arising out of or relating to this Agreement or the transactions contemplated hereby.

15

If the foregoing is in accordance with your understanding of our agreement, please sign and return to the Company a counterpart hereof, whereupon this instrument, along with all counterparts, will become a binding agreement among the several Initial Purchasers and the Company in accordance with its terms.

Very truly yours,
NorthWestern Corporation
By:	/s/ Brian B. Bird
	Name:  Brian B. Bird
	Title:  Vice President and Chief Financial Officer

The foregoing Registration

Rights Agreement is hereby confirmed

and accepted as of the date first

above written.

CREDIT SUISSE FIRST BOSTON LLC

LEHMAN BROTHERS INC.

Acting on behalf of themselves

and as the Representatives of

the several Initial Purchasers

By: CREDIT SUISSE FIRST BOSTON LLC
	By:	/s/ James T. Bartlett
		Name:  James T. Bartlett
		Title:  Managing Director
By: LEHMAN BROTHERS INC.
	By:	/s/ Michael Konigsberg
		Name:  Michael Konigsberg
		Title:  Managing Director

16

SCHEDULE A

Credit Suisse First Boston LLC

Lehman Brothers Inc.

Deutsche Bank Securities Inc.

ANNEX A

Each broker-dealer that receives Exchange Securities for its own account pursuant to the Exchange Offer must acknowledge that it will deliver a prospectus in connection with any resale of such Exchange Securities.  The Letter of Transmittal states that by so acknowledging and by delivering a prospectus, a broker-dealer will not be deemed to admit that it is an “underwriter” within the meaning of the Securities Act.  This Prospectus, as it may be amended or supplemented from time to time, may be used by a broker-dealer in connection with resales of Exchange Securities received in exchange for Initial Securities where such Initial Securities were acquired by such broker-dealer as a result of market-making activities or other trading activities.  The Company has agreed that, for a period of 180 days after the Expiration Date (as defined herein), it will make this Prospectus available to any broker-dealer for use in connection with any such resale.  See “Plan of Distribution.”

ANNEX B

Each broker-dealer that receives Exchange Securities for its own account in exchange for Securities, where such Initial Securities were acquired by such broker-dealer as a result of market-making activities or other trading activities, must acknowledge that it will deliver a prospectus in connection with any resale of such Exchange Securities.  See “Plan of Distribution.”

ANNEX C

PLAN OF DISTRIBUTION

Each broker-dealer that receives Exchange Securities for its own account pursuant to the Exchange Offer must acknowledge that it will deliver a prospectus in connection with any resale of such Exchange Securities.  This Prospectus, as it may be amended or supplemented from time to time, may be used by a broker-dealer in connection with resales of Exchange Securities received in exchange for Initial Securities where such Initial Securities were acquired as a result of market-making activities or other trading activities.  The Company has agreed that, for a period of 180 days after the Expiration Date, it will make this prospectus, as amended or supplemented, available to any broker-dealer for use in connection with any such resale.  In addition, until                       , 20  ,  all dealers effecting transactions in the Exchange Securities may be required to deliver a prospectus.(1)

The Company will not receive any proceeds from any sale of Exchange Securities by broker-dealers.  Exchange Securities received by broker-dealers for their own account pursuant to the Exchange Offer may be sold from time to time in one or more transactions in the over-the-counter market, in negotiated transactions, through the writing of options on the Exchange Securities or a combination of such methods of resale, at market prices prevailing at the time of resale, at prices related to such prevailing market prices or negotiated prices.  Any such resale may be made directly to purchasers or to or through brokers or dealers who may receive compensation in the form of commissions or concessions from any such broker dealer or the purchasers of any such Exchange Securities.  Any broker-dealer that resells Exchange Securities that were received by it for its own account pursuant to the Exchange Offer and any broker or dealer that participates in a distribution of such Exchange Securities may be deemed to be an “underwriter” within the meaning of the Securities Act and any profit on any such resale of Exchange Securities and any commission or concessions received by any such persons may be deemed to be underwriting compensation under the Securities Act.  The Letter of Transmittal states that, by acknowledging that it will deliver and by delivering a prospectus, a broker-dealer will not be deemed to admit that it is an “underwriter” within the meaning of the Securities Act.

For a period of 180 days after the Expiration Date the Company will promptly send additional copies of this Prospectus and any amendment or supplement to this Prospectus to any broker-dealer that requests such documents in the Letter of Transmittal.  The Company has agreed to pay all expenses incident to the Exchange Offer (including the expenses of one counsel for the Holders of the Securities) other than commissions or concessions of any brokers or dealers and will indemnify the Holders of the Securities (including any broker-dealers) against certain liabilities, including liabilities under the Securities Act.

(1)           In addition, the legend required by Item 502(b) of Regulation S-K will appear on the back cover page of the Exchange Offer prospectus.

ANNEX D

o            CHECK HERE IF YOU ARE A BROKER-DEALER AND WISH TO RECEIVE 10 ADDITIONAL COPIES OF THE PROSPECTUS AND 10 COPIES OF ANY AMENDMENTS OR SUPPLEMENTS THERETO.

Name:

Address:

If the undersigned is not a broker-dealer, the undersigned represents that it is not engaged in, and does not intend to engage in, a distribution of Exchange Securities.  If the undersigned is a broker-dealer that will receive Exchange Securities for its own account in exchange for Initial Securities that were acquired as a result of market-making activities or other trading activities, it acknowledges that it will deliver a prospectus in connection with any resale of such Exchange Securities; however, by so acknowledging and by delivering a prospectus, the undersigned will not be deemed to admit that it is an “underwriter” within the meaning of the Securities Act.

EX-4.4

Exhibit 4.4

NORTHWESTERN CORPORATION

TO

THE BANK OF NEW YORK

AND

MARYBETH LEWICKI

As Trustees under Mortgage and
Deed of Trust, dated as of
October 1, 1945, with NorthWestern Corporation

TWENTY-FOURTH SUPPLEMENTAL INDENTURE

Providing, among other things, for

First Mortgage Bonds, Collateral (2004) Series A, due 2009
First Mortgage Bonds, Collateral (2004) Series B, due 2011
and
First Mortgage Bonds, Collateral (2004) Series C, due 2014

Dated as of November 1, 2004

TWENTY-FOURTH SUPPLEMENTAL INDENTURE

THIS TWENTY-FOURTH SUPPLEMENTAL INDENTURE, dated as of November 1, 2004, between NORTHWESTERN CORPORATION, a corporation duly incorporated and existing under the laws of the State of Delaware (hereinafter called the “Company”), having its principal office at 125 S. Dakota Avenue, Suite 1100, Sioux Falls, South Dakota 57104, and THE BANK OF NEW YORK (hereinafter called the “Corporate Trustee”), a corporation of the State of New York, whose principal corporate trust office is located at 101 Barclay Street, New York, New York 10286 (successor to MORGAN GUARANTY TRUST COMPANY OF NEW YORK (formerly Guaranty Trust Company of New York)), and MARYBETH LEWICKI, whose post office address is c/o The Bank of New York, 101 Barclay Street, New York, New York 10286 (successor Co-Trustee to Douglas J. MacInnes, Arthur E. Burke, Karl R. Henrich, H.H. Gould, R. Amundsen, P.J. Crowley and W.T. Cunningham) (said MaryBeth Lewicki being hereinafter sometimes called the “Co-Trustee”, and the Corporate Trustee and the Co-Trustee being hereinafter together sometimes called the “Trustees”), as Trustees under the Mortgage and Deed of Trust, dated as of October 1, 1945 (hereinafter called the “Mortgage” and, together with any indentures supplemental thereto, the “Indenture”), which Mortgage was executed and delivered by The Montana Power Company, a corporation of the State of New Jersey (hereinafter called the “Company-New Jersey”), as indirect predecessor under the Mortgage to the Company (the Company being successor under the Mortgage to NorthWestern Energy, L.L.C. (hereinafter called “NorthWestern Energy”), formerly known as The Montana Power, L.L.C., a limited liability company of the State of Montana, and NorthWestern Energy being the successor under the Mortgage to The Montana Power Company, a corporation of the State of Montana (hereinafter called the “Company-Montana”)), to Guaranty Trust Company of New York and Arthur E. Burke, as Trustees, to secure the payment of bonds issued or to be issued under and in accordance with the provisions of the Mortgage, reference to which Mortgage is hereby made, this instrument (hereinafter called the “Twenty-fourth Supplemental Indenture”) being supplemental thereto;

WHEREAS, by the Mortgage, the Company-New Jersey covenanted that it would execute and deliver such supplemental indenture or indentures and such further instruments and do such further acts as might be necessary or proper to carry out more effectually the purposes of the Indenture and to make subject to the lien of the Indenture any property thereafter acquired, made or constructed and intended to be subject to the lien thereof; and

WHEREAS, the Company-New Jersey executed and delivered to the Trustees its First Supplemental Indenture, dated as of May 1, 1954 (hereinafter called the “First Supplemental Indenture”), and its Second Supplemental Indenture, dated as of April 1, 1959 (hereinafter called the “Second Supplemental Indenture”); and

WHEREAS, the Company-New Jersey was merged into the Company-Montana on November 30, 1961, and to evidence the succession of the Company-Montana to the Company-New Jersey for purposes of the bonds and the Indenture and the assumption by the Company-Montana of the covenants and conditions of the Company-New Jersey in the bonds and in the Indenture contained and to enable the Company-Montana to have and exercise the powers and rights of the Company-New Jersey under the Indenture in accordance with the terms thereof, the Company-Montana executed and delivered to the Trustees its Third Supplemental Indenture, dated as of November 30, 1961 (hereinafter called the “Third Supplemental Indenture”); and

WHEREAS, the Company-Montana executed and delivered to the Trustees its Fourth Supplemental Indenture, dated as of April 1, 1970 (hereinafter called the “Fourth Supplemental Indenture”); its Fifth Supplemental Indenture, dated as of April 1, 1971 (hereinafter called the “Fifth Supplemental Indenture”); its Sixth Supplemental Indenture, dated as of March 1, 1974 (hereinafter called the “Sixth Supplemental Indenture”); its Seventh Supplemental Indenture, dated as of December 1, 1974 (hereinafter called the “Seventh Supplemental Indenture”); its Eighth Supplemental Indenture, dated as of July 1, 1975 (hereinafter called the “Eighth Supplemental Indenture”); its Ninth Supplemental Indenture, dated as of December 1, 1975 (hereinafter called the “Ninth Supplemental Indenture”); its Tenth Supplemental Indenture, dated as of January 1, 1979 (hereinafter called the “Tenth Supplemental Indenture”); its Eleventh Supplemental Indenture, dated as of October 1, 1983 (hereinafter called the “Eleventh Supplemental Indenture”); its Twelfth Supplemental Indenture, dated as of January 1, 1984 (hereinafter called the “Twelfth Supplemental Indenture”); its Thirteenth Supplemental Indenture, dated as of December 1, 1991 (hereinafter called the “Thirteenth Supplemental Indenture”); its Fourteenth Supplemental Indenture, dated as of January 1, 1993 (hereinafter called the “Fourteenth Supplemental Indenture”); its Fifteenth Supplemental Indenture, dated as of March 1, 1993 (hereinafter called the “Fifteenth Supplemental Indenture”); its Sixteenth Supplemental Indenture, dated as of May 1, 1993 (hereinafter called the “Sixteenth Supplemental Indenture”); its Seventeenth Supplemental Indenture, dated as of December 1, 1993 (hereinafter called the “Seventeenth Supplemental Indenture”); its Eighteenth Supplemental Indenture, dated as of August 5, 1994 (hereinafter called the “Eighteenth Supplemental Indenture”); its Nineteenth Supplemental Indenture, dated as of December 16, 1999 (hereinafter called the “Nineteenth Supplemental Indenture”); and its Twentieth Supplemental Indenture, dated as of November 1, 2001 (hereinafter called the “Twentieth Supplemental Indenture”); and

WHEREAS, the Company-Montana was merged into NorthWestern Energy (under its then name, The Montana Power, L.L.C.) on February 13, 2002, and to evidence the succession of NorthWestern Energy (under its then name, The Montana Power, L.L.C.) to the Company-Montana for purposes of the bonds and the Indenture and the assumption by NorthWestern Energy (under its then name, The Montana Power, L.L.C.) of the covenants and conditions of the Company-Montana in the bonds and in the Indenture contained and to enable NorthWestern Energy (under its then name, The Montana Power, L.L.C.) to have and exercise the powers and rights of the Company-Montana under the Indenture in accordance

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with the terms thereof, NorthWestern Energy (under its then name, The Montana Power, L.L.C.) executed and delivered to the Trustees its Twenty-First Supplemental Indenture, dated as of February 13, 2002 (hereinafter called the “Twenty-first Supplemental Indenture”); and

WHEREAS, NorthWestern Energy changed its name from The Montana Power, L.L.C. to NorthWestern Energy, L.L.C. on March 19, 2002; and

WHEREAS, NorthWestern Energy transferred, subject to the Lien of the Indenture, substantially all of the Mortgaged and Pledged Property as an entirety to the Company on November 20, 2002 (the “Transfer Date”), and to evidence the succession of the Company to NorthWestern Energy for purposes of the bonds and the Indenture and the assumption by the Company of the covenants and conditions of NorthWestern Energy in the bonds and in the Indenture contained and to enable the Company to have and exercise the powers and rights of NorthWestern Energy under the Indenture in accordance with the terms thereof, the Company executed and delivered to the Trustees its Twenty-second Supplemental Indenture, dated as of November 15, 2002 (hereinafter called the “Twenty-second Supplemental Indenture”); and

WHEREAS, the Company executed and delivered to the Trustees its Twenty-third Supplemental Indenture, dated as of February 1, 2003 (hereinafter called the “Twenty-third Supplemental Indenture”); and

WHEREAS, the Mortgage and the First, Second, Third, Fourth, Fifth, Sixth, Seventh, Eighth, Ninth, Tenth, Eleventh, Twelfth, Thirteenth, Fourteenth, Fifteenth, Sixteenth, Seventeenth, Eighteenth, Nineteenth, Twentieth, Twenty-first, Twenty-second and Twenty-third Supplemental Indentures were recorded in the official records of various counties and states as required by the Indenture; and

WHEREAS, an instrument dated March 15, 1955 was executed by the Company-New Jersey appointing Karl R. Henrich as Co-Trustee in succession to said Arthur E. Burke, resigned, under the Mortgage and by Karl R. Henrich accepting the appointment as Co-Trustee under the Mortgage in succession to said Arthur E. Burke, which instrument was recorded in various counties in the states of Montana, Idaho and Wyoming; and

WHEREAS, an instrument dated June 29, 1962 was executed by the Company-Montana appointing H.H. Gould as Co-Trustee in succession to said Karl R. Henrich, resigned, under the Mortgage and by H.H. Gould accepting the appointment as Co-Trustee under the Mortgage in succession to said Karl R. Henrich, which instrument was recorded in various counties in the states of Montana, Idaho and Wyoming; and

WHEREAS, an instrument dated June 22, 1973 was executed by the Company-Montana appointing R. Amundsen as Co-Trustee in succession to said H.H. Gould, resigned, under the Mortgage and by R. Amundsen accepting the appointment as Co-Trustee under the Mortgage in succession to said H.H. Gould, which instrument was recorded in various counties in the states of Montana, Idaho and Wyoming; and

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WHEREAS, an instrument dated July 1, 1986 was executed by the Company-Montana appointing P.J. Crowley as Co-Trustee in succession to said R. Amundsen, resigned, under the Mortgage and by P.J Crowley accepting the appointment as Co-Trustee under the Mortgage in succession to said R. Amundsen, which instrument was recorded in various counties in the states of Montana, Idaho and Wyoming; and

WHEREAS, by the Eighteenth Supplemental Indenture, the Company-Montana appointed (i) W.T. Cunningham as Co-Trustee in succession to said P.J. Crowley, resigned, under the Mortgage and W.T. Cunningham accepted the appointment as Co-Trustee under the Mortgage in succession to said P.J. Crowley, and (ii) The Bank of New York as Corporate Trustee in succession to Morgan Guaranty Trust Company of New York, resigned, under the Mortgage and The Bank of New York accepted the appointment as Corporate Trustee under the Mortgage in succession to said Morgan Guaranty Trust Company of New York, which supplemental indenture was recorded in various counties in the states of Montana, Idaho and Wyoming; and

WHEREAS, an instrument dated March 29, 1999 was executed by the Company-Montana appointing Douglas J. MacInnes as Co-Trustee in succession to said W.T. Cunningham, resigned, under the Mortgage and by Douglas J. MacInnes accepting the appointment as Co-Trustee under the Mortgage in succession to said W.T. Cunningham, which instrument was recorded in various counties in the states of Montana, Idaho and Wyoming; and

WHEREAS, by the Twenty-third Supplemental Indenture, the Company appointed MaryBeth Lewicki as Co-Trustee in succession to said Douglas J. MacInnes, resigned, under the Mortgage and MaryBeth Leweicki accepted the appointment as Co-Trustee under the Mortgage in succession to said Douglas J. MacInnes;

WHEREAS, the Company-New Jersey or the Company-Montana has heretofore issued, in accordance with the provisions of the Mortgage, the following series of First Mortgage Bonds:

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Series	Principal Amount Issued		Principal Amount Outstanding
2-7/8% Series due 1975	$	40,000,000	NONE
3-1/8% Series due 1984	6,000,000		NONE
4-1/2% Series due 1989	15,000,000		NONE
8-1/4% Series due 1974	30,000,000		NONE
7-1/2% Series due 2001 (Fifth)	25,000,000		NONE
8-5/8% Series due 2004	60,000,000		NONE
8-3/4% Series due 1981	30,000,000		NONE
9.60% Series due 2005	35,000,000		NONE
9.70% Series due 2005	65,000,000		NONE
9-7/8% Series due 2009	50,000,000		NONE
11-3/4% Series due 1993	75,000,000		NONE
10/10-1/8% Series due 2004/2014	80,000,000		NONE
8-1/8% Series due 2014	41,200,000		NONE
7.70% Series due 1999 (Fourteenth)	55,000,000		NONE
8-1/4% Series due 2007 (Fifteenth)	55,000,000		$365,000
8.95% Series due 2022 (Sixteenth)	50,000,000		1,446,000
Secured Medium-Term Notes (Seventeenth)	68,000,000		13,000,000
7% Series due 2005 (Eighteenth)	50,000,000		5,386,000
6-1/8% Series due 2023 (Nineteenth)	90,205,000		90,205,000
5.90% Series due 2023 (Twentieth)	80,000,000		80,000,000
0% Series due 1999 (Twenty-first)	210,321,007		NONE
7.30% Series due 2006 (Twenty-second)	150,000,000		150,000,000
Collateral (2002) Series due 2006 (Twenty-third)	280,000,000		NONE(1)

(1)Being paid and surrendered for cancellation concurrently with the execution and delivery of this Twenty-fourth Supplemental Indenture.

which bonds are also hereinafter sometimes called “Bonds of the First through Twenty-third Series”, respectively; and

WHEREAS, Section 8 of the Mortgage provides that the form of each series of bonds (other than the First Series) issued thereunder and of the coupons to be attached to coupon bonds of such series shall be established by Resolution of the Board of Directors of the Company and that the form of such series, as established by said Board of Directors, shall specify the descriptive title of the bonds and various other terms thereof, and may also contain such provisions not inconsistent with the provisions of the Indenture as the Board of Directors may, in its discretion, cause to be inserted therein expressing or referring to the terms and conditions upon which such bonds are to be issued and/or secured under the Indenture; and

WHEREAS, Section 120 of the Mortgage provides, among other things, that any power, privilege or right expressly or impliedly reserved to or in any way conferred upon the Company by any provision of the Indenture, whether such power, privilege or right is in any way restricted or is unrestricted, may be in whole or in part waived or surrendered or subjected to any restriction if at the time unrestricted or to additional restriction if already restricted, and the Company may enter into any further covenants, limitations or restrictions for the benefit of any one or more series of bonds issued thereunder, or the Company may cure any ambiguity contained therein or in any supplemental indenture or may (in lieu of establishment by Resolution as provided in Section 8 of the Mortgage) establish the terms and provisions of any series of bonds other than the First Series, by an instrument in writing executed and acknowledged by the Company in such manner as would be necessary to entitle a conveyance of real estate to record in all of the states in which any property at the time subject to the lien of the Indenture shall be situated; and

WHEREAS, the Company now desires to create three new series of bonds and (pursuant to the provisions of Section 120 of the Mortgage) to add to its covenants and

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agreements contained in the Mortgage certain other covenants and agreements to be observed by it and to alter and amend in certain respects the covenants and provisions contained in the Indenture; and

WHEREAS, the execution and delivery by the Company of this Twenty-fourth Supplemental Indenture, and the terms of the Bonds of the Twenty-fourth, Twenty-fifth and Twenty-sixth Series, hereinafter referred to, have been duly authorized by the Board of Directors of the Company by appropriate Resolutions of said Board of Directors.

NOW, THEREFORE, THIS INDENTURE WITNESSETH:

That the Company, in consideration of the premises and of $1.00 to it duly paid by the Trustees at or before the ensealing and delivery of these presents, the receipt whereof is hereby acknowledged, and in further evidence of assurance of the estate, title and rights of the Trustees and in order further to secure the payment of both the principal of and interest and premium, if any, on the bonds from time to time issued under the Indenture, according to their tenor and effect and the performance of all the provisions of the Indenture (including any modification made as in the Mortgage provided) and of said bonds, and to confirm the lien of the Mortgage, as heretofore supplemented, on certain after-acquired property, hereby grants, bargains, sells, releases, conveys, assigns, transfers, mortgages, pledges, sets over and confirms (subject, however, to Excepted Encumbrances as defined in Section 6 of the Mortgage, as heretofore supplemented) unto MaryBeth Lewicki, Co-Trustee, and (to the extent of its legal capacity to hold the same for the purposes hereof) to The Bank of New York, the Corporate Trustee, as Trustees under the Indenture, and to their successor or successors in said trust, and to said Trustees and their successors and assigns forever, all property, real, personal and mixed, of the kind or nature specifically mentioned in the Mortgage, as heretofore supplemented, or of any other kind or nature (whether or not located in the State of Montana), acquired by the Company after the date of the execution and delivery of the Mortgage, as heretofore supplemented (except any herein or in the Mortgage, as heretofore supplemented, expressly excepted), now owned or, subject to the provisions of subsection (I) of Section 87 of the Mortgage, as heretofore supplemented, hereafter acquired by the Company (by purchase, consolidation, merger, donation, construction, erection or in any other way) and wheresoever situated, including (without in anywise limiting or impairing by the enumeration of the same the scope and intent of the foregoing, or of any general description contained in the Indenture) all lands, power sites, flowage rights, water rights, water locations, water appropriations, ditches, flumes, reservoirs, reservoir sites, canals, raceways, dams, dam sites, aqueducts and all other rights or means for appropriating, conveying, storing and supplying water; all rights of way and roads; all plants for the generation of electricity by steam, water and/or other power; all powerhouses, gas plants, street lighting systems, standards and other equipment incidental thereto, telephone, radio and television systems, air-conditioning systems and equipment incidental thereto, water works, water systems, steam heat and hot water plants, substations, lines, service and supply systems, bridges, culverts, tracks, ice or refrigeration plants and equipment, offices, buildings and other structures and the equipment thereof, all machinery, engines, boilers, dynamos, electric, gas and other machines, regulators, meters, transformers, generators, motors, electrical, gas and mechanical appliances, conduits, cables, water, steam heat, gas or other

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pipes, gas mains and pipes, service pipes, fittings, valves and connections, pole and transmission lines, wires, cables, tools, implements, apparatus, furniture and chattels; all franchises, consents or permits, all lines for the transmission and distribution of electric current, gas, steam heat or water for any purpose including towers, poles, wires, cables, pipes, conduits, ducts and all apparatus for use in connection therewith; all real estate, lands, easements, servitudes, licenses, permits, franchises, privileges, rights of way and other rights in or relating to real estate or the occupancy of the same and (except as herein or in the Mortgage, as heretofore supplemented, expressly excepted) all the right, title and interest of the Company in and to all other property of any kind or nature appertaining to and/or used and/or occupied and/or enjoyed in connection with any property hereinbefore or in the Mortgage, as heretofore supplemented, described.

TOGETHER with all and singular the tenements, hereditaments, prescriptions, servitudes and appurtenances belonging or in anywise appertaining to the aforesaid property or any part thereof, with the reversion and reversions, remainder and remainders and (subject to the provisions of Section 57 of the Mortgage) the tolls, rents, revenues, issues, earnings, income, product and profits thereof, and all the estate, right, title and interest and claim whatsoever, at law as well as in equity, which the Company now has or may hereafter acquire in and to the aforesaid property and franchises and every part and parcel thereof.

IT IS HEREBY AGREED by the Company that, subject to the provisions of subsection (I) of Section 87 of the Mortgage, as heretofore supplemented, all the property, rights and franchises acquired by the Company (by purchase, consolidation, merger, donation, construction, erection or in any other way) after the date hereof, except any herein or in the Mortgage, as heretofore supplemented, expressly excepted, shall be and are as fully granted and conveyed hereby and as fully embraced within the lien hereof and the lien of the Mortgage, as heretofore supplemented, as if such property, rights and franchises were now owned by the Company and were specifically described herein and conveyed hereby.

PROVIDED that the following are not and are not intended to be now or hereafter granted, bargained, sold, released, conveyed, assigned, transferred, mortgaged, hypothecated, affected, pledged, set over or confirmed hereunder and are hereby expressly excepted from the lien and operation of the Mortgage, as supplemented, viz:  (1) cash, shares of stock, bonds, notes and other obligations and other securities not specifically pledged, paid, deposited, delivered or held under the Mortgage, as supplemented, or covenanted so to be; (2) merchandise, equipment, apparatus, materials or supplies held for the purpose of sale or other disposition in the usual course of business; fuel, oil and similar materials and supplies consumable in the operation of any of the properties of the Company; all aircraft, tractors, rolling stock, trolley coaches, buses, motor coaches, automobiles, motor trucks, and other vehicles and materials and supplies held for the purpose of repairing or replacing (in whole or part) any of the same; (3) bills, notes and accounts receivable, judgments, demands and choses in action, and all contracts, leases and operating agreements not specifically pledged under the Mortgage, as supplemented, or covenanted so to be; the Company’s contractual rights or other interest in or with respect to tires not owned by the Company; (4) the last day of the term of any lease or leasehold which may be or become subject to the

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lien of the Mortgage, as supplemented; (5) electric energy, gas, steam, water, ice, and other materials or products generated, manufactured, produced, purchased or acquired by the Company for sale, distribution or use in the ordinary course of its business; all timber, minerals, mineral rights and royalties and all Gas and Oil Production Property, as defined in Section 4 of the Mortgage, as supplemented; (6) the Company’s franchise to be a corporation; and (7) any property heretofore released pursuant to any provisions of the Indenture and not heretofore disposed of by the Company-New Jersey, the Company-Montana, NorthWestern Energy or the Company; provided, however, that the property and rights expressly excepted from the lien and operation of the Mortgage, as supplemented, in the above subdivisions (2) and (3) shall (to the extent permitted by law) cease to be so excepted in the event and as of the date that either or both of the Trustees or a receiver or trustee shall enter upon and take possession of the Mortgaged and Pledged Property in the manner provided in Article XIII of the Mortgage by reason of the occurrence of a Default as defined in Section 65 thereof.

TO HAVE AND TO HOLD all such properties, real, personal and mixed, granted, bargained, sold, released, conveyed, assigned, transferred, mortgaged, pledged, set over or confirmed by the Company as aforesaid, or intended so to be, unto the Co-Trustee and (to the extent of its legal capacity to hold the same for the purposes hereto) unto the Corporate Trustee, as Trustees, and their successors and assigns forever.

IN TRUST NEVERTHELESS, for the same purposes and upon the same terms, trusts and conditions and subject to and with the same provisos and covenants as are set forth in the Mortgage, as supplemented, this Twenty-fourth Supplemental Indenture being supplemental thereto.

AND IT IS HEREBY COVENANTED by the Company that all the terms, conditions, provisos, covenants and provisions contained inthe Mortgage, as supplemented, shall affect and apply to the property hereinbefore described and conveyed and to the estate, rights, obligations and duties of the Company and the Trustees and the beneficiaries of the trust with respect to said property, and to the Trustees and their successors as Trustees of said property in the same manner and with the same effect as if the said property had been owned by the Company-New Jersey at the time of the execution of the Mortgage, and had been specifically and at length described in and conveyed to the Trustees, by the Mortgage as a part of the property therein stated to be conveyed.

SUBJECT NEVERTHELESS, to the limitation permitted by subsection (I) of Section 87 of the Mortgage, as supplemented, namely, that notwithstanding the foregoing, the Mortgage, as supplemented, shall not become or be or be required to become or be a lien upon any of the properties or franchises owned by the Company on the Transfer Date or thereafter acquired by the Company (by purchase, consolidation, merger, donation, construction, erection or in any other way) except (a) those acquired by it from NorthWestern Energy, and improvements, extensions and additions thereto and renewals and replacements thereof, (b) the property made and used by the Company as the basis under any of the provisions of the Indenture for the authentication and delivery of additional bonds or the withdrawal of cash or the release of property or a credit under Section 39 or Section 40 of the

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Indenture, and (c) such franchises, repairs and additional property as may be acquired, made or constructed by the Company (1) to maintain, renew and preserve the franchises covered by the Indenture, or (2) to maintain the property mortgaged and intended to be mortgaged under the Indenture as an operating system or systems in good repair, working order and condition, or (3) in rebuilding or renewal of property, subject to the Lien under the Indenture, damaged or destroyed, or (4) in replacement of or substitution for machinery, apparatus, equipment, frames, towers, poles, wire, pipe, tools, implements and furniture, subject to the Lien thereunder, which shall have become old, inadequate, obsolete, worn out, unfit, unadapted, unserviceable, undesirable or unnecessary for use in the operation of the property mortgaged and intended to be mortgaged thereunder.

The Company further covenants and agrees to and with the Trustees and their successors in said trust under the Indenture, as follows:

ARTICLE I

Twenty-fourth Series of Bonds

SECTION 1.1  There shall be a series of bonds designated “Collateral (2004) Series A, due 2009” (such series herein sometimes referred to as the “Twenty-fourth Series” and the bonds of such series herein sometimes referred to as the “Bonds of the Twenty-fourth Series”) each of which shall also bear the descriptive title “First Mortgage Bond”, and the form thereof, which as established by Resolution of the Board of Directors of the Company, shall be substantially as provided in Exhibit A attached hereto and, thereby, shall contain suitable provisions with respect to the matters hereinafter in this Section specified.

Bonds of the Twenty-fourth Series shall be issued to Lehman Commercial Paper Inc., as collateral agent (together with its successors in such capacity, the “Collateral Agent”) under the Bond Delivery and Collateral Agreement, dated as of November 1, 2004 (as amended or otherwise modified, or as waived, or as replaced in each case, from time to time in accordance with its terms, the “Collateral Agreement”), between the Company and the Collateral Agent, to secure the obligations of the Company to pay when due the Revolving Credit Applicable Share (as hereinafter defined) of the Revolving Credit Obligations (as hereinafter defined) under the Credit Agreement, dated as of November 1, 2004 (as amended or otherwise modified, or as waived, or as replaced, in each case, from time to time in accordance with its terms, the “Credit Agreement”), among the Company, the several lenders from time to time parties thereto (the “Lenders”), Lehman Brothers Inc. and Deutsche Bank Securities, Inc., as joint lead arrangers and joint bookrunners, Deutsche Bank Securities Inc., as syndication agent, Union Bank of California, N.A. and KeyBank National Association, as co-documentation agents, Lehman Commercial Paper Inc., as administrative agent (in such capacity, the “Administrative Agent”) and the Collateral Agent.

As used herein, “Revolving Credit Obligations” means the obligations of the Company (A) to pay (i) principal of and interest on (a) the Revolving Credit Loans (as defined in the Credit Agreement), (b) the Swing Line Loans (as defined in the Credit

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Agreement), and (c) drawings under Letters of Credit that are not reimbursed pursuant to and in accordance with the Credit Agreement (collectively, “Revolving Loans”), (ii) commitment fees on the average daily amount of the unused Total Revolving Credit Commitments (as defined in the Credit Agreement); and (iii) letter of credit fees on the amount available to be drawn under Letters of Credit (as defined in the Credit Agreement), and (B) to cash collateralize Letters of Credit pursuant to and in accordance with Section 8 of the Credit Agreement..

As used herein, “Revolving Credit Applicable Share” means, as of any day, a fraction (expressed as a percentage rounded to the second decimal place), (i) the numerator of which is the aggregate principal amount of the Bonds of the Twenty-fourth Series that are Outstanding on such day, and (ii) the denominator of which is the sum of (a) the aggregate principal amount of the Bonds of the Twenty-fourth Series that are Outstanding on such day, plus (b) the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series A, due 2009, of the Company (the “South Dakota Revolving Credit Bonds”) that are outstanding on such day under the Company’s Mortgage Indenture and Deed of Trust, dated as of August 1, 1993, relating (among other things) to property owned by the Company in the States of South Dakota, Nebraska, Iowa and North Dakota (as amended and supplemented, the “South Dakota Mortgage”).  Simultaneously with the issuance and registration of the Bonds of the Twenty-fourth Series in the name of the Collateral Agent (for the same purpose), the South Dakota Revolving Credit Bonds will be issued to the Collateral Agent to secure the Revolving Credit Obligations under the Credit Agreement.  Initially, the Revolving Credit Applicable Share will be 72.00% (being the expression as a percentage (rounded to the second decimal place) of a fraction, the numerator of which is $90,000,000 (the aggregate principal amount of the Bonds of the Twenty-fourth Series that are to be issued and become Outstanding) and the denominator of which is $125,000,000 (the sum of $90,000,000, the aggregate principal amount of the Bonds of the Twenty-fourth Series that are to be issued and become Outstanding, plus $35,000,000, the aggregate principal amount of the South Dakota Revolving Credit Bonds that are to be issued and become outstanding under the South Dakota Mortgage simultaneously with the issuance of the Bonds of the Twenty-fourth Series).  Pursuant to the Collateral Agreement, the Collateral Agent has agreed to furnish to the Corporate Trustee (with a copy to the Company) as soon as practicable after any change in the Revolving Credit Applicable Share, a certificate, signed by a person purporting to be its duly authorized officer, notifying the Corporate Trustee of such change in the Revolving Credit Applicable Share (a “Revolving Credit Applicable Share Certificate”).  Each Revolving Credit Applicable Share Certificate shall set forth (i) the changed Revolving Credit Applicable Share, (ii) the date such change occurred, (iii) the aggregate principal amount of the Bonds of the Twenty-fourth Series then Outstanding, and (iv) the aggregate principal amount of the South Dakota Revolving Credit Bonds then outstanding under the South Dakota Mortgage.  The Corporate Trustee may conclusively presume that the Revolving Credit Applicable Share is 72.00% unless and until the Corporate Trustee receives a Revolving Credit Applicable Share Certificate.  Following receipt by the Corporate Trustee of a Revolving Credit Applicable Share Certificate, the Corporate Trustee may conclusively presume that the Revolving Credit Applicable Share is as set forth in such Revolving Credit Applicable Share Certificate unless and until the Corporate Trustee

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receives a subsequent Revolving Credit Applicable Share Certificate (and the Corporate Trustee shall be fully protected in relying thereon).

Bonds of the Twenty-fourth Series shall mature on November 1, 2009 (the “Revolving Credit Maturity Date”), with the unpaid principal of the Bonds of the Twenty-fourth Series to be payable on the Revolving Credit Maturity Date; they shall be issued as fully registered bonds in denominations of One Thousand Dollars or in any integral multiple of One Dollar in excess of One Thousand Dollars; the unpaid principal amount of the Bonds of the Twenty-fourth Series shall bear interest (i) with respect to the portion or amount of such principal that is equal to the principal amount of Revolving Loans, at one or more variable interest rates per annum which rate or rates for each day shall be equal to the rate or rates per annum borne by Revolving Loans in accordance with the Credit Agreement for such day (calculated in the manner provided in the Credit Agreement for the calculation of interest on Revolving Loans), payable on each day on which interest is payable on Revolving Loans in accordance with the Credit Agreement (and in an amount equal to the Revolving Credit Applicable Share of the amount of interest that is payable on Revolving Loans on such day in accordance with the Credit Agreement), (ii) with respect to the portion or amount of such principal (in excess of the amount described in the preceding clause (i)) that is equal to the Revolving Credit Applicable Share of the unused Total Revolving Credit Commitments (as defined in the Credit Agreement), at one or more variable interest rates per annum which rate or rates for any day shall be equal to the rate or rates per annum at which commitment fees are payable under the Credit Agreement on the unused Total Revolving Credit Commitments, payable on each day on which commitment fees are payable under the Credit Agreement (and in an amount equal to the Revolving Credit Applicable Share of the amount of commitment fees that is payable under the Credit Agreement on such day), and (iii) with respect to the portion or amount of such principal (in excess of the amounts described in the preceding clauses (i) and (ii)) that is equal to the Revolving Credit Applicable Share of the amount available to be drawn under Letters of Credit (as defined in the Credit Agreement), at one or more variable interest rates per annum which rate or rates for each day shall be equal to the rate or rates per annum at which letter of credit fees are payable under the Credit Agreement on the amount available to be drawn under Letters of Credit, payable on each day on which letter of credit fees are payable under the Credit Agreement (and in an amount equal to the Revolving Credit Applicable Share of the amount of letter of credit fees that is payable under the Credit Agreement on such day), in each case, to the Collateral Agent, as the registered owner, without regard to, or necessity for, any record date; the principal of and interest on each said Bond to be payable at the office or agency of the Company in the Borough of Manhattan, The City of New York, in such coin or currency of the United States of America as at the time of payment is legal tender for public and private debts.  Bonds of the Twenty-fourth Series shall be dated as in Section 10 of the Mortgage provided.

At the option of the registered owner, any Bonds of the Twenty-fourth Series, upon surrender thereof for cancellation at the office or agency of the Company in the Borough of Manhattan, The City of New York, shall be exchangeable for a like aggregate principal amount of bonds of the same series of other authorized denominations.

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Bonds of the Twenty-fourth Series shall not be transferable except to any successor Collateral Agent under the Collateral Agreement.  As a condition precedent to any transfer of the Bonds of the Twenty-fourth Series by the Collateral Agent, the Collateral Agent shall submit to the Company, the Corporate Trustee and, if applicable, any bond registrar or transfer agent for the Bonds of the Twenty-fourth Series (in addition to all other documents and instruments required to be submitted pursuant to the Mortgage) a certificate of the Collateral Agent, signed by a person purporting to be its duly authorized officer, certifying that the transferee in such transfer is a successor Collateral Agent under the Collateral Agreement (and the Corporate Trustee may conclusively presume the statements in any such certificate of the Collateral Agent to be correct and shall be fully protected in relying thereon).

Any transfer of Bonds of the Twenty-fourth Series (i) shall be subject to the provisions of Section 12 of the Mortgage, except that the provisions of the last two sentences of such Section 12 shall not be applicable to any transfer of Bonds of the Twenty-fourth Series to a successor Collateral Agent under the Collateral Agreement (and the Company hereby waives the provisions of such sentences with respect to any such transfer), and (ii) shall be made at the office or agency of the Company in the Borough of Manhattan, The City of New York.

The Company hereby waives any right to make any charge for any exchange or transfer of Bonds of the Twenty-fourth Series by the Collateral Agent, whether to reimburse itself for any tax or taxes or other governmental charge or otherwise (it being understood that the Company shall pay any tax or taxes or governmental or other charge which may be payable by reason of any exchange or transfer of Bonds of the Twenty-fourth Series by the Collateral Agent).

The Company has appointed The Bank of New York as its agent to receive Bonds of the Twenty-fourth Series presented or surrendered for payment, to receive Bonds of the Twenty-fourth Series surrendered for registration of transfer or exchange and to receive notices and demands to or upon the Company in respect of the Bonds of the Twenty-fourth Series and the Indenture; and the corporate trust office of The Bank of New York in the Borough of Manhattan, The City of New York shall be the office or agency of the Company in the Borough of Manhattan, The City of New York at which such presentations, surrenders, notices and demands may be made or served.

Upon the delivery of this Twenty-fourth Supplemental Indenture, Bonds of the Twenty-fourth Series in the aggregate principal amount of $90,000,000 (as reduced from time to time in the manner hereinafter described in subdivisions II and III below, the “Maximum Principal Amount”) are to be issued forthwith and will be Outstanding in addition to the bonds hereinbefore stated to be Outstanding.

Bonds of the Twenty-fourth Series shall be subject to the following terms and conditions (including, without limitation, redemption terms and conditions):

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(I)From time to time after the issuance of the Bonds of the Twenty-fourth Series, and as Revolving Loans are prepaid and reborrowed subject to and in accordance with the Credit Agreement, (A) for purposes of determining the amount of principal payable by the Company with respect to the Bonds of the Twenty-fourth Series, the unpaid principal amount of the Bonds of the Twenty-fourth Series at any time shall be deemed to be equal to the Revolving Credit Applicable Share of the unpaid principal amount of the Revolving Loans at such time, plus, if an acceleration of the Revolving Loans shall be in effect in accordance with the Credit Agreement at such time, the amount of cash collateral required to be provided by the Company pursuant to Section 8 of the Credit Agreement in respect of Letters of Credit, and (B) for all other purposes of the Indenture (including, without limitation, the determination of the amount of principal on which interest is payable and the determination of the principal amount with respect to which the Collateral Agent, as registered owner, is entitled to vote or otherwise exercise rights as registered owner), the Bonds of the Twenty-fourth Series shall be deemed to be “Outstanding” at any time in an aggregate principal amount equal to the Maximum Principal Amount at such time.  Pursuant to (and by reason of the provisions of Section 10.2 of) the Credit Agreement, the Administrative Agent has agreed to submit to the Corporate Trustee (with copies to the Collateral Agent and the Company), from time to time promptly after the request of the Corporate Trustee or the Company, a written statement, signed by a person purporting to be its duly authorized officer (an “Unpaid Principal Amount Statement”) stating the unpaid principal amount of the Revolving Loans (and, as a consequence, of the principal amount of the Bonds of the Twenty-fourth Series payable by the Company) as of the date of such Unpaid Principal Amount Statement, setting forth the portions or amounts of the Revolving Loans that are Revolving Credit Loans, Swing Line Loans and unreimbursed drawings under Letters of Credit.  The Corporate Trustee may conclusively presume the statements contained in each Unpaid Principal Amount Statement to be correct (and the Corporate Trustee shall be fully protected in relying thereon).

(II)The Maximum Principal Amount on and as of the date of original issuance of the Bonds of the Twenty-fourth Series shall be $90,000,000 (which amount shall be equal to the Revolving Credit Applicable Share of the Total Revolving Credit Commitments on and as of such date) and thereafter shall be reduced from time to time upon each Revolving Credit Commitment Redemption (as hereinafter defined in subdivision III below) and each Revolving Credit Event of Default Commitment Termination Redemption (as hereinafter defined in subdivision III below), in each case, by an amount equal to the aggregate principal amount of the Bonds of the Twenty-fourth Series that are deemed to have been redeemed pursuant to such Revolving Credit Commitment Redemption or such Revolving Credit Event of Default Commitment Termination Redemption.

(III)Bonds of the Twenty-fourth Series shall be subject to redemption as follows (but shall not otherwise be or become subject to redemption, whether at the option of the holders thereof or the Company or pursuant to any other requirements or provisions of the Indenture):  (A) on each day on which there is a permanent reduction or termination of the Revolving Credit Commitments (as defined in the Credit Agreement) pursuant to Section 2.10 of the Credit Agreement, Bonds of the Twenty-fourth Series shall be deemed to have

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been redeemed in an aggregate principal amount equal to the Revolving Credit Applicable Share of the amount of such permanent reduction or termination of the Revolving Credit Commitments pursuant to such Section 2.10 (a “Revolving Credit Commitment Redemption”); (B) on each day on which the Revolving Credit Commitments are permanently terminated pursuant to Section 8 of the Credit Agreement, Bonds of the Twenty-fourth Series shall be deemed to have been redeemed in an aggregate principal amount which, after giving effect to such termination, results in the Maximum Principal Amount of the Bonds of Twenty-fourth Series being equal to the Revolving Credit Applicable Share of the sum of the principal amount of the Revolving Loans then outstanding under the Credit Agreement and the amount then available to be drawn under Letters of Credit (a “Revolving Credit Event of Default Commitment Termination Redemption”); and (C) on each day on which the Revolving Loans are accelerated in accordance with the Credit Agreement (an “Acceleration Redemption Date”), the entire aggregate principal amount of the Bonds of the Twenty-fourth Series shall be subject to mandatory redemption by the Company (an “Acceleration Redemption”); in each case, without any necessity for notice or call by the Company or by the Corporate Trustee (such notice and call being waived by the registered owners of the Bonds of the Twenty-fourth Series by the acceptance of the Bonds of the Twenty-fourth Series and in connection with each Redemption Demand hereinafter described); provided, however, that in the event of a reinstatement of the Revolving Credit Commitments or a rescission or annulment of the acceleration of the Revolving Loans pursuant to the Credit Agreement or otherwise, the related Revolving Credit Event of Default Commitment Termination Redemption or the related Acceleration Redemption shall be deemed to be rescinded or annulled, without prejudice to the occurrence of another Revolving Credit Event of Default Commitment Termination Redemption or another Acceleration Redemption upon and by reason of a subsequent termination of the Revolving Credit Commitments pursuant to Section 8 of the Credit Agreement or another acceleration of the Revolving Loans in accordance with the Credit Agreement.  Acceleration Redemption of the Bonds of the Twenty-fourth Series on an Acceleration Redemption Date shall be at a redemption price equal to the principal amount (determined in accordance with the provisions of subdivision II above) of the Bonds of the Twenty-fourth Series that is then payable by the Company (without premium), together with interest accrued on said principal to and including such Acceleration Redemption Date (collectively, an “Acceleration Redemption Amount”); and such Acceleration Redemption Amount shall be due and payable on such Acceleration Redemption Date.  In the event of any failure by the Company to pay when due an Acceleration Redemption Amount, interest shall accrue on such unpaid Acceleration Redemption Amount at the rates (and in amounts equal to the Revolving Credit Applicable Share of the amounts) of interest that accrue on the corresponding unpaid principal of and interest on the Revolving Loans in accordance with the Credit Agreement.

The Corporate Trustee may conclusively presume that no redemption of Bonds of the Twenty-fourth Series is deemed to have occurred or resulted in a reduction of the Maximum Principal Amount (in the case of a Revolving Credit Commitment Redemption or a Revolving Credit Event of Default Commitment Termination Redemption) or is required to occur (in the case of an Acceleration Redemption) unless and until it shall have received a written notice from the Administrative Agent, signed by a person purporting to be its duly

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authorized officer, stating that the Revolving Credit Commitments have been permanently reduced or terminated pursuant to Section 2.10 of the Credit Agreement or the Revolving Credit Commitments have been permanently terminated pursuant to Section 8 of the Credit Agreement or the Revolving Loans have been accelerated in accordance with the Credit Agreement (a “Redemption Demand”).  Each Redemption Demand also shall (i) state the date on which the Revolving Credit Commitments were permanently reduced or terminated pursuant to Section 2.10 of the Credit Agreement or the Revolving Credit Commitments were permanently terminated pursuant to Section 8 of the Credit Agreement or the Revolving Loans were accelerated, (ii) the amount by which the Revolving Credit Commitments were so permanently reduced or terminated and the Maximum Principal Amount (determined in accordance with this Twenty-fourth Supplemental Indenture) after giving effect to the related and deemed redemption of Bonds of the Twenty-fourth Series or the principal amount of the Revolving Loans subject to acceleration on such date, (iii) the principal amount of Bonds of the Twenty-fourth Series that are deemed to have been redeemed or are to be redeemed on such date in accordance with this Twenty-fourth Supplemental Indenture by reason of such permanent reduction or termination of the Revolving Credit Commitments and such reduction of the Maximum Principal Amount or such acceleration of the Revolving Loans, and (iv) in the case of an Acceleration Redemption, the Acceleration Redemption Amount payable with respect to the Bonds of the Twenty-fourth Series (determined in accordance with this Twenty-fourth Supplemental Indenture) and setting forth the amounts of the respective portions thereof representing principal of and interest on the Bonds of the Twenty-fourth Series.  Each Redemption Demand shall be deemed to constitute a written waiver by the Collateral Agent, as registered owner of all Bonds of the Twenty-fourth Series then Outstanding, of notice of redemption and call for redemption by the Company or the Corporate Trustee of the Bonds of the Twenty-fourth Series subject to redemption as described in such Redemption Demand.  The Corporate Trustee may conclusively presume the statements contained in each Redemption Demand to be correct (and the Corporate Trustee shall be fully protected in relying thereon).

The Corporate Trustee may conclusively presume that no rescission or annulment of a Revolving Credit Event of Default Commitment Termination Redemption or an Acceleration Redemption (in respect of which the Corporate Trustee has received a Redemption Demand) is required unless and until it shall have received a written notice from the Administrative Agent, signed by a person purporting to be its duly authorized officer, stating that the termination of the Revolving Credit Commitments pursuant to Section 8 of the Credit Agreement or the acceleration of the Revolving Loans has been rescinded or annulled in accordance with the Credit Agreement or otherwise (a “Rescission Notice”).  Each Rescission Notice also shall state the date on which the termination of the Revolving Credit Commitments pursuant to Section 8 of the Credit Agreement or the acceleration of the Revolving Loans was rescinded or annulled in accordance with the Credit Agreement or otherwise and, as consequence, the redemption of the Bonds of the Twenty-fourth Series was rescinded or annulled in accordance with this Twenty-fourth Supplemental Indenture.  The Corporate Trustee may conclusively presume the statements contained in any Rescission Notice to be correct (and the Corporate Trustee shall be fully protected in relying thereon).

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Pursuant to (and by reason of the provisions of Section 10.2 of) the Credit Agreement, the Administrative Agent has agreed to submit to the Corporate Trustee (with copies to the Collateral Agent and the Company) (i) a Redemption Demand with respect to, and in connection with, each event that gives rise to a redemption (deemed or actual) of Bonds of the Twenty-fourth Series, and (ii) a Rescission Notice in connection with any event that gives rise to the rescission or annulment of a Revolving Credit Event of Default Commitment Termination Redemption or an Acceleration Redemption.  Pursuant to the Collateral Agreement, the Collateral Agent has agreed, upon written request of the Company and so long as no Default or Event of Default described in Section 8(f) of the Credit Agreement shall have occurred and be continuing, to surrender or exchange its Bond or Bonds of the Twenty-fourth Series, from time to time (including, without limitation, promptly following each redemption of Bonds of the Twenty-fourth Series that is deemed to occur (in the case of a Revolving Credit Commitment Redemption or a Revolving Credit Event of Default Commitment Termination Redemption) or that occurs (in the case of an Acceleration Redemption) in accordance with this Twenty-fourth Supplemental Indenture), so that at all times the Collateral Agent is holding one or more Bond or Bonds of the Twenty-fourth Series in an aggregate principal amount equal to, but not in excess of, the Maximum Principal Amount of the Bonds of the Twenty-fourth Series at such times.

(IV)It is expressly stated (for the avoidance of any doubt) that, notwithstanding anything herein or in any Bond of the Twenty-fourth Series to the contrary (other than the provisions of subdivision VI below), each payment of principal of or interest on the Bonds of the Twenty-fourth Series that becomes due and payable on any day in accordance with this Twenty-fourth Supplemental Indenture (whether by reason of stated due date, acceleration, redemption or otherwise) shall correspond to, and be equal to the Revolving Credit Applicable Share of, a payment of Revolving Credit Obligations that becomes due and payable on such day in accordance with the Credit Agreement.

(V)The obligation of the Company to make each payment of principal of or interest on the Bonds of the Twenty-fourth Series that becomes due and payable in accordance with this Twenty-fourth Supplemental Indenture (A) shall be fully satisfied and discharged if the corresponding payment of the Revolving Credit Obligations shall have been fully paid under and in accordance with the Credit Agreement, and (B) shall be partially satisfied and discharged if the corresponding payment of the Revolving Credit Obligations shall have been partially paid under and in accordance with the Credit Agreement (such partial satisfaction and discharge with respect to the Bonds of the Twenty-fourth Series to be in an amount equal to the Revolving Credit Applicable Share of the amount of such partial payment with respect to the Revolving Credit Obligations).  The Corporate Trustee may conclusively presume that the obligation of the Company to make payments with respect to the principal of and interest on the Bonds of the Twenty-fourth Series has been fully satisfied and discharged unless and until the Corporate Trustee shall have received a written notice from the Administrative Agent, signed by a person purporting to be its duly authorized officer, stating (i) that the Company has failed to make timely payment in full or in part of an amount of Revolving Credit Obligations which became due and payable in accordance with the Credit Agreement, (ii) the amount and date of such payment of Revolving Credit

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Obligations which the Company has failed to make in accordance with the Credit Agreement, and (iii) the amount of principal of and/or interest on the Bonds of the Twenty-fourth Series which, in accordance with this Twenty-fourth Supplemental Indenture, has not been satisfied and discharged by reason of such failure of the Company.  The Corporate Trustee may conclusively presume the statements contained in any such notice from the Administrative Agent to be correct unless and until the Corporate Trustee shall receive a subsequent and/or modified notice from the Administrative Agent pursuant to and in accordance with this subdivision (V) (and the Corporate Trustee shall be fully protected in relying thereon).  Without limitation of the foregoing, and for the avoidance of any doubt, it is expressly stated that the Corporate Trustee shall not be responsible for (i) the calculation of interest on the Bonds of the Twenty-fourth Series, or (ii) the determination of any amount (including, without limitation, any amount of the Revolving Credit Obligations) that is payable or paid under the Credit Agreement.

(VI)Nothing herein or in any of the Bonds of the Twenty-fourth Series (including, without limitation, any reference to the principal payable with respect to the Bonds of the Twenty-fourth Series being determined on the basis of the Revolving Credit Applicable Share of the principal payable with respect to the Revolving Credit Obligations) shall, or shall be deemed or construed to, increase the aggregate principal amount of the Bonds of the Twenty-fourth Series that are Outstanding at any time to an amount in excess of the Maximum Principal Amount at such time.

ARTICLE II

Twenty-fifth Series of Bonds

SECTION 2.1  There shall be a series of bonds designated “Collateral (2004) Series B, due 2011” (such series herein sometimes referred to as the “Twenty-fifth Series” and the bonds of such series herein sometimes referred to as the “Bonds of the Twenty-fifth Series”) each of which shall also bear the descriptive title “First Mortgage Bond”, and the form thereof, which as established by Resolution of the Board of Directors of the Company, shall be substantially as provided in Exhibit B attached hereto and, thereby, shall contain suitable provisions with respect to the matters hereinafter in this Section specified.

Bonds of the Twenty-fifth Series shall be issued to the Collateral Agent to secure the obligations of the Company to pay when due the Term Loan Applicable Share (as hereinafter defined) of the principal of and interest on the term loans (the “Term Loans”) made and outstanding under the Credit Agreement.

As used herein, “Term Loan Applicable Share” means, as of any day, a fraction (expressed as a percentage rounded to the second decimal place), (i) the numerator of which is the aggregate principal amount of the Bonds of the Twenty-fifth Series that are Outstanding on such day, and (ii) the denominator of which is the sum of (a) the aggregate principal amount of the Bonds of the Twenty-fifth Series that are Outstanding on such day, plus (b) the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series B, due 2011, of the Company (the “South Dakota Term Loan Bonds”) that are

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outstanding on such day under the Company’s South Dakota Mortgage.  Simultaneously with the issuance and registration of the Bonds of the Twenty-fifth Series in the name of the Collateral Agent (for the same purpose), the South Dakota Term Loan Bonds will be issued to the Collateral Agent to secure the obligations of the Company to pay when due a portion of the principal of and interest on the Term Loans.  Initially, the Term Loan Applicable Share will be 72.00% (being the expression as a percentage (rounded to the second decimal place) of a fraction, the numerator of which is $72,000,000 (the aggregate principal amount of the Bonds of the Twenty-fifth Series that are to be issued and become Outstanding) and the denominator of which is $100,000,000 (the sum of $72,000,000, the aggregate principal amount of the Bonds of the Twenty-fifth Series that are to be issued and become Outstanding, plus $28,000,000, the aggregate principal amount of the South Dakota Term Loan Bonds that are to be issued and become outstanding under the South Dakota Mortgage simultaneously with the issuance of the Bonds of the Twenty-fifth Series).  Pursuant to the Collateral Agreement, the Collateral Agent has agreed to furnish to the Corporate Trustee (with a copy to the Company) as soon as practicable after any change in the Term Loan Applicable Share, a certificate, signed by a person purporting to be its duly authorized officer, notifying the Corporate Trustee of such change in the Term Loan Applicable Share (a “Term Loan Applicable Share Certificate”).  Each Term Loan Applicable Share Certificate shall set forth (i) the changed Term Loan Applicable Share, (ii) the date such change occurred, (iii) the aggregate principal amount of the Bonds of the Twenty-fifth Series then Outstanding, and (iv) the aggregate principal amount of the South Dakota Term Loan Bonds then outstanding under the South Dakota Mortgage.  The Corporate Trustee may conclusively presume that the Term Loan Applicable Share is 72.00% unless and until the Corporate Trustee receives a Term Loan Applicable Share Certificate.  Following receipt by the Corporate Trustee of a Term Loan Applicable Share Certificate, the Corporate Trustee may conclusively presume that the Term Loan Applicable Share is as set forth in such Term Loan Applicable Share Certificate unless and until the Corporate Trustee receives a subsequent Term Loan Applicable Share Certificate (and the Corporate Trustee shall be fully protected in relying thereon).

Bonds of the Twenty-fifth Series shall mature on November 1, 2011 (the “Term Loan Maturity Date”), with (i) an installment of the principal of the Bonds of the Twenty-fifth Series in an amount equal to $180,000 (said amount representing one quarter of one percent (0.25%) of the original aggregate principal amount of the Bonds of the Twenty-fifth Series) to be payable on each March 31, June 30, September 30 and December 31, commencing March 31, 2005 and continuing through and including September 30, 2010, (ii) an installment of the principal amount of the Bonds of the Twenty-fifth Series in an amount equal to $16,920,000 (said amount representing twenty-three and one-half percent (23.5%) of the original aggregate principal amount of the Bonds of the Twenty-fifth Series) to be payable on December 31, 2010, March 31, 2011 and June 30, 2011, and (iii) the balance of the principal of the Bonds of the Twenty-fifth Series to be payable on the Term Loan Maturity Date (in each case, unless an equal installment or balance of principal of the Term Loans is not due and payable on such day or on the Term Loan Maturity Date, as applicable, in accordance with the Credit Agreement by reason of prior prepayment of the Term Loans (in which event, there shall be due and payable on the

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Bonds of the Twenty-fifth Series on such day or on the Term Loan Maturity Date, as applicable, an amount of principal of said Bonds equal to the Term Loan Applicable Share of the amount of principal of the Term Loans that is payable on such day or on the Term Loan Maturity Date, as applicable, in accordance with the Credit Agreement)); they shall be issued as fully registered bonds in denominations of One Thousand Dollars or in any integral multiple of One Dollar in excess of One Thousand Dollars; the unpaid principal amount of the Bonds of the Twenty-fifth Series shall bear interest at one or more variable interest rates per annum which rate or rates for each day shall be equal to the rate or rates per annum borne by the Term Loans in accordance with the Credit Agreement for such day (calculated in the manner provided in the Credit Agreement for the calculation of interest on the Term Loans), payable on each day on which interest is payable on the Term Loans in accordance with the Credit Agreement (and in an amount equal to the Term Loan Applicable Share of the amount of interest that is payable on the Term Loans on such day in accordance with the Credit Agreement) to the Collateral Agent, as the registered owner, without regard to, or necessity for, any record date; the principal of and interest on each said Bond to be payable at the office or agency of the Company in the Borough of Manhattan, The City of New York, in such coin or currency of the United States of America as at the time of payment is legal tender for public and private debts.  Bonds of the Twenty-fifth Series shall be dated as in Section 10 of the Mortgage provided.

For the avoidance of any doubt, it is expressly stated that scheduled amortization payments with respect to the Bonds of the Twenty-fifth Series (as specified for the Bonds of the Twenty-fifth Series prior to the Term Loan Maturity Date pursuant to the preceding paragraph of this Section 2.1) shall not constitute a redemption in part of the Bonds of the Twenty-fifth Series for purposes of Section 53 of the Mortgage (as supplemented) (and, therefore, surrender of the Bonds of the Twenty-fifth Series shall not be a condition to the receipt by the registered owners of the Bonds of the Twenty-fifth Series of such scheduled amortization payments).

At the option of the registered owner, any Bonds of the Twenty-fifth Series, upon surrender thereof for cancellation at the office or agency of the Company in the Borough of Manhattan, The City of New York, shall be exchangeable for a like aggregate principal amount of bonds of the same series of other authorized denominations.

Bonds of the Twenty-fifth Series shall not be transferable except to any successor Collateral Agent under the Collateral Agreement.  As a condition precedent to any transfer of the Bonds of the Twenty-fifth Series by the Collateral Agent, the Collateral Agent shall submit to the Company, the Corporate Trustee and, if applicable, any bond registrar or transfer agent for the Bonds of the Twenty-fifth Series (in addition to all other documents and instruments required to be submitted pursuant to the Mortgage) a certificate of the Collateral Agent, signed by a person purporting to be its duly authorized officer, certifying that the transferee in such transfer is a successor Collateral Agent under the Collateral Agreement (and the Corporate Trustee may conclusively presume the statements in any such certificate of the Collateral Agent to be correct and shall be fully protected in relying thereon).

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Any transfer of Bonds of the Twenty-fifth Series (i) shall be subject to the provisions of Section 12 of the Mortgage, except that the provisions of the last two sentences of such Section 12 shall not be applicable to any transfer of Bonds of the Twenty-fifth Series to a successor Collateral Agent under the Collateral Agreement (and the Company hereby waives the provisions of such sentences with respect to any such transfer), and (ii) shall be made at the office or agency of the Company in the Borough of Manhattan, The City of New York.

The Company hereby waives any right to make any charge for any exchange or transfer of Bonds of the Twenty-fifth Series by the Collateral Agent, whether to reimburse itself for any tax or taxes or other governmental charge or otherwise (it being understood that the Company shall pay any tax or taxes or governmental or other charge which may be payable by reason of any exchange or transfer of Bonds of the Twenty-fifth Series by the Collateral Agent).

The Company has appointed The Bank of New York as its agent to receive Bonds of the Twenty-fifth Series presented or surrendered for payment, to receive Bonds of the Twenty-fifth Series surrendered for registration of transfer or exchange and to receive notices and demands to or upon the Company in respect of the Bonds of the Twenty-fifth Series and the Indenture; and the corporate trust office of The Bank of New York in the Borough of Manhattan, The City of New York shall be the office or agency of the Company in the Borough of Manhattan, The City of New York at which such presentations, surrenders, notices and demands may be made or served.

Upon the delivery of this Twenty-fourth Supplemental Indenture, Bonds of the Twenty-fifth Series in the aggregate principal amount of $72,000,000 are to be issued forthwith and will be Outstanding in addition to the bonds hereinbefore stated to be Outstanding.

Bonds of the Twenty-fifth Series shall be subject to the following redemption and other terms and conditions:

(I)Bonds of the Twenty-fifth Series shall be subject to redemption as follows (but shall not otherwise be or become subject to redemption, whether at the option of the holders thereof or the Company or pursuant to any other requirements or provisions of the Indenture):  (A) on each day on which the Term Loans are prepaid in accordance with the Credit Agreement, Bonds of the Twenty-fifth Series shall be deemed to have been redeemed in an aggregate principal amount equal to the Term Loan Applicable Share of the aggregate principal amount of the Term Loans that are so prepaid on such day (a “Term Loan Prepayment Redemption”); and (B) on each day on which the Term Loans are accelerated in accordance with the Credit Agreement (an “Acceleration Redemption Date”), the entire aggregate principal amount of the Bonds of the Twenty-fifth Series shall be subject to mandatory redemption by the Company (an “Acceleration Redemption”); in each case, without any necessity for notice or call by the Company or by the Corporate Trustee (such notice and call being waived by the registered owners of the Bonds of the Twenty-fifth Series by the acceptance of the Bonds of the Twenty-fifth Series and in connection with each

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Redemption Demand hereinafter described); provided, however, that in the event of a rescission or annulment of an acceleration of the Term Loans pursuant to the Credit Agreement or otherwise, the related Acceleration Redemption shall be deemed to be rescinded or annulled (without prejudice to the occurrence of another Acceleration Redemption upon and by reason of a subsequent acceleration of the Term Loans in accordance with the Credit Agreement).  Acceleration Redemption of Bonds of the Twenty-fifth Series on an Acceleration Redemption Date shall be at a redemption price equal to the principal amount of the Bonds of the Twenty-fifth Series (without premium), together with interest accrued on said principal to and including such Acceleration Redemption Date (collectively, an “Acceleration Redemption Amount”); and such Acceleration Redemption Amount shall be due and payable on the Bonds of the Twenty-fifth Series on such Acceleration Redemption Date.  In the event of any failure by the Company to pay when due the Acceleration Redemption Amount with respect to an Acceleration Redemption of Bonds of the Twenty-fifth Series, interest shall accrue on such unpaid Acceleration Redemption Amount at the rates (and in amounts equal to the Term Loan Applicable Share of the amounts) of interest that accrue on the corresponding unpaid principal of and interest on the Term Loans in accordance with the Credit Agreement.

The Corporate Trustee may conclusively presume that no redemption of Bonds of the Twenty-fifth Series is deemed to have occurred (in the case of a Term Loan Prepayment Redemption) or is required (in the case of an Acceleration Redemption) unless and until it shall have received a written notice from the Administrative Agent, signed by a person purporting to be its duly authorized officer, stating that Term Loans have been prepaid or have been accelerated, in either case, in  accordance with the Credit Agreement (a “Redemption Demand”).  Each Redemption Demand also shall state (i) the date on which the Term Loans were prepaid or accelerated in accordance with the Credit Agreement, (ii) the principal amount of the Term Loans so prepaid or accelerated on such date, (iii) the principal amount of Bonds of the Twenty-fifth Series that are deemed to have been redeemed or are to be redeemed on such date in accordance with this Twenty-fourth Supplemental Indenture by reason of such prepayment or acceleration, and (iv) in the case of an Acceleration Redemption, the Acceleration Redemption Amount payable with respect to the Bonds of the Twenty-fifth Series (determined in accordance with this Twenty-fourth Supplemental Indenture) and setting forth the amounts of the respective portions thereof representing principal of and interest on the Bonds of the Twenty-fifth Series.  Each Redemption Demand shall be deemed to constitute a written waiver by the Collateral Agent, as registered owner of all Bonds of the Twenty-fifth Series then Outstanding, of notice of redemption and call for redemption by the Company or the Corporate Trustee of the Bonds of the Twenty-fifth Series deemed redeemed or subject to redemption as described in such Redemption Demand.  The Corporate Trustee may conclusively presume the statements contained in each Redemption Demand to be correct (and the Corporate Trustee shall be fully protected in relying thereon).

The Corporate Trustee may conclusively presume that no rescission or annulment of an Acceleration Redemption (in respect of which the Corporate Trustee has received a Redemption Demand) is required unless and until it shall have received a written notice from the Administrative Agent, signed by a person purporting to be its duly authorized

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officer, stating that the acceleration of the Term Loans has been rescinded or annulled in accordance with the Credit Agreement or otherwise (a “Rescission Notice”).  Each Rescission Notice also shall state the date on which the acceleration of the Term Loans was rescinded or annulled in accordance with the Credit Agreement or otherwise and, as consequence, the redemption of the Bonds of the Twenty-fifth Series was rescinded or annulled in accordance with this Twenty-fourth Supplemental Indenture.  The Corporate Trustee may conclusively presume the statements contained in any Rescission Notice to be correct (and the Corporate Trustee shall be fully protected in relying thereon).

Pursuant to (and by reason of the provisions of Section 10.2 of) the Credit Agreement, the Administrative Agent has agreed to submit to the Corporate Trustee (with copies to the Collateral Agent and the Company) (i) a Redemption Demand with respect to, and in connection with, each event that gives rise to a redemption (deemed or actual) of Bonds of the Twenty-fifth Series, and (ii) a Rescission Notice in connection with any event that gives rise to the rescission or annulment of an Acceleration Redemption.  Pursuant to the Collateral Agreement, the Collateral Agent has agreed, upon written request of the Company and so long as no Default or Event of Default described in Section 8(f) of the Creidt Agreement shall have occurred and be continuing, to surrender or exchange its Bond or Bonds of the Twenty-fifth Series, from time to time (including, without limitation, promptly following each redemption (deemed or actual) of Bonds of the Twenty-fifth Series), so that at all times the Collateral Agent is holding one or more Bond or Bonds of the Twenty-fifth Series in an aggregate principal amount equal to, but not in excess of, the aggregate principal amount of the Bonds of the Twenty-fifth Series that are then Outstanding (and the Term Loan Applicable Share of the aggregate principal amount of the Term Loans that are then outstanding under the Credit Agreement).

(II)It is expressly stated (for the avoidance of any doubt) that, notwithstanding anything herein or in any Bond of the Twenty-fifth Series to the contrary (other than the provisions of subdivision IV below), each payment of principal of or interest on the Bonds of the Twenty-fifth Series that becomes due and payable on any day in accordance with this Twenty-fourth Supplemental Indenture (whether by reason of stated due date, acceleration, redemption or otherwise) shall correspond to, and be equal to the Term Loan Applicable Share of, a payment of principal of or interest on the Term Loans that becomes due and payable on such day in accordance with the Credit Agreement.

(III)The obligation of the Company to make each payment of principal of or interest on the Bonds of the Twenty-fifth Series that becomes due and payable in accordance with this Twenty-fourth Supplemental Indenture (A) shall be fully satisfied and discharged if the corresponding payment of the principal of or interest on the Term Loans shall have been fully paid under and in accordance with the Credit Agreement, and (B) shall be partially satisfied and discharged if the corresponding payment of the principal of or interest on the Term Loans shall have been partially paid under and in accordance with the Credit Agreement (such partial satisfaction and discharge with respect to the Bonds of the Twenty-fifth Series to be in an amount equal to the Term Loan Applicable Share of the amount of such partial payment with respect to the Term Loans).  The Corporate Trustee may conclusively presume that the obligation of the Company to make payments with respect to

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the principal of and interest on the Bonds of the Twenty-fifth Series has been fully satisfied and discharged unless and until the Corporate Trustee shall have received a written notice from the Administrative Agent, signed by a person purporting to be its duly authorized officer, stating (i) that the Company has failed to make timely payment in full or in part of an amount of principal of and/or interest on the Term Loans which became due and payable in accordance with the Credit Agreement, (ii) the amount and date of such payment of principal of and/or interest on the Term Loans which the Company has failed to make in accordance with the Credit Agreement, and (iii) the amount of principal of and/or interest on the Bonds of the Twenty-fifth Series which, in accordance with this Twenty-fourth Supplemental Indenture, has not been satisfied and discharged by reason of such failure of the Company.  The Corporate Trustee may conclusively presume the statements contained in any such notice from the Administrative Agent to be correct unless and until the Corporate Trustee shall receive a subsequent and/or modified notice from the Administrative Agent pursuant to and in accordance with this subdivision (III) (and the Corporate Trustee shall be fully protected in relying thereon).  Without limitation of the foregoing, and for the avoidance of any doubt, it is expressly stated that the Corporate Trustee shall not be responsible for (i) the calculation of interest on the Bonds of the Twenty-fifth Series, or (ii) the determination of any amount (including, without limitation, any principal of or interest on the Term Loans) that is payable or paid under the Credit Agreement.

(IV)Nothing herein or in any of the Bonds of the Twenty-fifth Series (including, without limitation, any reference to the principal payable with respect to the Bonds of the Twenty-fifth Series being determined on the basis of the Term Loan Applicable Share of the principal payable with respect to the Term Loans) shall, or shall be deemed or construed to, (A) increase the aggregate principal amount of the Bonds of the Twenty-fifth Series that are Outstanding from time to time, (B) cause or permit an amount of principal of the Bonds of the Twenty-fifth Series to be or to become due and payable which, when added to all other principal of such Bonds theretofore paid, exceeds $72,000,000, or (C) cause or permit to be or to become due and payable interest on the Bonds of the Twenty-fifth Series which is payable on any principal of the Bonds of the Twenty-fifth Series that is in excess of the principal of the Bonds of the Twenty-fifth Series as restricted pursuant to the preceding clauses (A) and (B).

ARTICLE III

Twenty-sixth Series of Bonds

SECTION 3.1  There shall be a series of bonds designated “Collateral (2004) Series C, due 2014”  (such series herein sometimes referred to as the “Twenty-sixth Series” and the bonds of such series herein sometimes referred to as the “Bonds of the Twenty-sixth Series”) each of which shall also bear the descriptive title “First Mortgage Bond”, and the form thereof, which as established by Resolution of the Board of Directors of the Company, shall be substantially as provided in Exhibit C attached hereto and, thereby, shall contain suitable provisions with respect to the matters hereinafter in this Section specified.

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Bonds of the Twenty-sixth Series shall be issued to and registered in the name of U.S. Bank, National Association, as trustee (together with its successors in such capacity, the “Senior Note Trustee”) under the Indenture, dated as of November 1, 2004, between the Company and the Senior Note Trustee, as supplemented and amended by Supplemental Indenture No. 1, dated as of November 1, 2004 (as so supplemented and amended and as may be further supplemented, amended or otherwise modified in accordance with its terms, the “Senior Note Indenture”), to be owned and held by the Senior Note Trustee under the terms of the Senior Note Indenture as security for the payment of the principal of, premium (if any) and interest on a series of senior secured notes of the Company issued pursuant to the Senior Note Indenture designated “Senior Secured Notes, 5.875% Series A due 2014” (the “Series A Senior Notes”) and, if and to the extent issued and delivered in exchange for the Series A Senior Notes subject to and in accordance with the Senior Note Indenture, a series of senior secured notes of the Company designated “Senior Secured Notes, 5.875% Exchange Series A due 2014” (the “Series A Exchange Notes”).  The Series A Notes and, if and to the extent issued in exchange for Series A Senior Notes subject to and in accordance with the Senior Note Indenture, the Series A Exchange Notes are referred to hereinafter, collectively, as the “Senior Notes”.  For purposes of the Senior Note Indenture, Bonds of the Twenty-sixth Series, together with the South Dakota Senior Notes Bonds (as such term is hereinafter defined), are “the ‘related’ or ‘corresponding’ First Mortgage Bonds” with respect to the Senior Notes.

As used herein, “Senior Notes Applicable Share” means, as of any day, a fraction (expressed as a percentage rounded to the eighth decimal place), (i) the numerator of which is the aggregate principal amount of the Bonds of the Twenty-sixth Series that are Outstanding on such day, and (ii) the denominator of which is the sum of (a) the aggregate principal amount of the Bonds of the Twenty-sixth Series that are Outstanding on such day, plus (b) the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series C, due 2014, of the Company (the “South Dakota Senior Notes Bonds”) that are outstanding on such day under the South Dakota Mortgage.  Simultaneously with the issuance and registration of the Bonds of the Twenty-sixth Series in the name of the Senior Note Trustee (for the same purpose), the South Dakota Senior Notes Bonds will be issued to and registered in the name of the Senior Note Trustee, to be owned and held by the Senior Note Trustee under the terms of the Senior Note Indenture as security for the payment of the principal of, premium (if any) and interest on the Senior Notes.  Initially, the Applicable Share will be 71.55555556% (being the expression as a percentage (rounded to the eighth decimal place) of a fraction, the numerator of which is $161,000,000 (the aggregate principal amount of the Bonds of the Twenty-sixth Series that are to be issued and become Outstanding) and the denominator of which is $225,000,000 (the sum of $161,000,000, the aggregate principal amount of the Bonds of the Twenty-sixth Series that are to be issued and become Outstanding, plus $64,000,000, the aggregate principal amount of the South Dakota Senior Notes Bonds that are to be issued and become outstanding under the South Dakota Mortgage simultaneously with the issuance of the Bonds of the Twenty-sixth Series).  Pursuant to the Senior Note Indenture, the Senior Note Trustee has agreed to furnish to the Corporate Trustee (with a copy to the Company) as soon as practicable after any change in the Senior Notes Applicable Share, a certificate, signed by a person purporting to be its duly

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authorized officer, notifying the Corporate Trustee of such change in the Senior Notes Applicable Share (a “Senior Notes Applicable Share Certificate”).  Each Senior Notes Applicable Share Certificate shall set forth (i) the changed Senior Notes Applicable Share, (ii) the date such change occurred, (iii) the aggregate principal amount of the Bonds of the Twenty-sixth Series then Outstanding, and (iv) the aggregate principal amount of the South Dakota Senior Notes Bonds then outstanding under the South Dakota Mortgage.  The Corporate Trustee may conclusively presume that the Senior Notes Applicable Share is 71.55555556% unless and until the Corporate Trustee receives a Senior Notes Applicable Share Certificate.  Following receipt by the Corporate Trustee of a Senior Notes Applicable Share Certificate, the Corporate Trustee may conclusively presume that the Senior Notes Applicable Share is as set forth in such Senior Notes Applicable Share Certificate unless and until the Corporate Trustee receives a subsequent Senior Notes Applicable Share Certificate (and the Corporate Trustee shall be fully protected in relying thereon).

Bonds of the Twenty-sixth Series shall mature on November 1, 2014 (the “Senior Notes Maturity Date”), with the unpaid principal of the Bonds of the Twenty-sixth Series to be due and payable on the Senior Notes Maturity Date; they shall be issued as fully registered bonds in denominations of One Thousand Dollars or in any integral multiple of One Dollar in excess of One Thousand Dollars; the unpaid principal amount of the Bonds of the Twenty-sixth Series shall bear interest at the rate of five and seven-eighths percent 5.875% per annum (calculated in the same manner as interest is calculated on the Senior Notes in accordance with the Senior Note Indenture), payable semiannually on the first (1st) day of each May and November, commencing on May 1, 2005 and continuing until the principal of the Bonds of the Twenty-sixth Series is paid (or provided for in accordance with the Senior Note Indenture), to the Senior Note Trustee, as the registered owner, without regard to, or necessity for, any record date; principal of, (premium (if any) and interest on each said Bond to be payable at the office or agency of the Company in the Borough of Manhattan, The City of New York, in such coin or currency of the United States of America as at the time of payment is legal tender for public and private debts.  Bonds of the Twenty-sixth Series shall be dated as in Section 10 of the Mortgage provided.

At the option of the registered owner, any Bonds of the Twenty-sixth Series, upon surrender thereof for cancellation at the office or agency of the Company in the Borough of Manhattan, The City of New York, shall be exchangeable for a like aggregate principal amount of bonds of the same series of other authorized denominations.

Bonds of the Twenty-sixth Series shall not be transferable except to any successor Senior Note Trustee under the Senior Note Indenture.  As a condition precedent to any transfer of the Bonds of the Twenty-sixth Series by the Senior Note Trustee, the Senior Note Trustee shall submit to the Company, the Corporate Trustee and, if applicable, any bond registrar or transfer agent for the Bonds of the Twenty-sixth Series (in addition to all other documents and instruments required to be submitted pursuant to the Mortgage) a certificate of the Senior Note Trustee, signed by a person purporting to be its duly authorized officer, certifying that the transferee in such transfer is a successor Senior Note Trustee under the Senior Note Indenture (and the Corporate Trustee may conclusively presume the

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statements in any such certificate of the Senior Note Trustee to be correct and shall be fully protected in relying thereon).

Any transfer of Bonds of the Twenty-sixth Series (i) shall be subject to the provisions of Section 12 of the Mortgage, except that the provisions of the last two sentences of such Section 12 shall not be applicable to any transfer of Bonds of the Twenty-sixth Series to a successor Senior Note Trustee under the Senior Note Indenture (and the Company hereby waives the provisions of such sentences with respect to any such transfer), and (ii) shall be made at the office or agency of the Company in the Borough of Manhattan, The City of New York.

The Company hereby waives any right to make any charge for any exchange or transfer of Bonds of the Twenty-sixth Series by the Senior Note Trustee, whether to reimburse itself for any tax or taxes or other governmental charge or otherwise (it being understood that the Company shall pay any tax or taxes or governmental or other charge which may be payable by reason of any exchange or transfer of Bonds of the Twenty-sixth Series by the Senior Note Trustee.

The Company has appointed The Bank of New York as its agent to receive Bonds of the Twenty-sixth Series presented or surrendered for payment, to receive Bonds of the Twenty-sixth Series surrendered for registration of transfer or exchange and to receive notices and demands to or upon the Company in respect of the Bonds of the Twenty-sixth Series and the Indenture; and the corporate trust office of The Bank of New York in the Borough of Manhattan, The City of New York shall be the office or agency of the Company in the Borough of Manhattan, The City of New York at which such presentations, surrenders, notices and demands may be made or served.

Upon the delivery of this Twenty-fourth Supplemental Indenture, Bonds of the Twenty-sixth Series in the aggregate principal amount of $161,000,000 are to be issued forthwith and will be Outstanding in addition to the bonds hereinbefore stated to be Outstanding.

Bonds of the Twenty-sixth Series shall be subject to the following redemption and other terms and conditions:

(I)            Bonds of the Twenty-sixth Series shall be subject to redemption as follows (but shall not otherwise be or become subject to redemption, whether at the option of the holders thereof or the Company or pursuant to any other requirements or provisions of the Indenture):  (A) on each day on which Senior Notes become due and payable in accordance with Section 405 of the Senior Note Indenture by reason of redemption in accordance with the Senior Note Indenture (a “Senior Notes Redemption Payment Date”), Bonds of the Twenty-sixth Series shall be subject to mandatory redemption by the Company in an aggregate principal amount equal to the Senior Notes Applicable Share of the aggregate principal amount of the Senior Notes that become so due and payable on such Senior Notes Redemption Payment Date (a “Corresponding Redemption”); and (B) on each day on which the Senior Notes become due and payable in accordance with Section 702 of the Senior Note

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Indenture by reason of acceleration of the Senior Notes in accordance with the Senior Note Indenture (a “Senior Notes Acceleration Payment Date”), the entire aggregate principal amount of the Bonds of the Twenty-sixth Series shall be subject to mandatory redemption by the Company (an “Acceleration Redemption”); in each case, without any necessity for notice or call by the Company or by the Corporate Trustee (such notice and call being waived by the registered owners of the Bonds of the Twenty-sixth Series by the acceptance of the Bonds of the Twenty-sixth Series and in connection with each Redemption Demand hereinafter described); provided, however, that in the event of a rescission or annulment of an acceleration of the Senior Notes pursuant to the Senior Note Indenture, the related Acceleration Redemption shall be deemed to be rescinded or annulled (without prejudice to the occurrence of another Acceleration Redemption upon and by reason of a subsequent acceleration of the Senior Notes in accordance with the Senior Note Indenture).

Each Corresponding Redemption of Bonds of the Twenty-sixth Series on a Senior Notes Redemption Payment Date shall be at a redemption price equal to the redemption price payable in connection with the redemption of Senior Notes to which it corresponds (consisting of principal of and, if applicable to such redemption of Senior Notes in accordance with the Senior Note Indenture, premium on such Senior Notes), together with interest accrued on the principal included in such redemption price to such Senior Notes Redemption Payment Date (a “Corresponding Redemption Amount”); and such Corresponding Redemption Amount shall be due and payable on such Senior Notes Redemption Payment Date.  Each Acceleration Redemption of Bonds of the Twenty-sixth Series on a Senior Notes Acceleration Payment Date shall be at a redemption price equal to the principal amount of the Bonds of the Twenty-sixth Series (without premium), together with interest accrued on said principal to the date of redemption (an “Acceleration Redemption Amount”); and such Acceleration Redemption Amount shall be due and payable on such Senior Notes Acceleration Payment Date.  In the event of any failure by the Company to pay when due the Corresponding Redemption Amount with respect to a Corresponding Redemption of Bonds of the Twenty-sixth Series or the Acceleration Redemption Amount with respect to an Acceleration Redemption of Bonds of the Twenty-sixth Series, interest shall accrue on such unpaid Corresponding Redemption Amount or such unpaid Acceleration Redemption Amount at the rates (and in amounts equal to the Senior Notes Applicable Share of the amounts) of interest that accrue on the corresponding unpaid principal of, premium (if any) and interest on the Senior Notes in accordance with the Senior Note Indenture.

The Corporate Trustee may conclusively presume that no redemption of Bonds of the Twenty-sixth Series is required unless and until it shall have received a written notice from the Senior Note Trustee, signed by a person purporting to be its duly authorized officer, stating that Senior Notes became due and payable pursuant to Section 405 or 702 of the Senior Note Indenture by reason of redemption or acceleration in accordance with the Senior Note Indenture (a “Redemption Demand”).  Each Redemption Demand also shall state (i) the date on which Senior Notes became due and payable by reason of redemption or acceleration in accordance with the Senior Note Indenture, (ii) the principal amount of the Senior Notes that became so due and payable on such date, (iii) the principal amount of

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Bonds of the Twenty-sixth Series to be redeemed on such date in accordance with this Twenty-fourth Supplemental Indenture by reason of such redemption or acceleration, and (iv) the Corresponding Redemption Amount or the Acceleration Redemption Amount payable on such date with respect to Bonds of the Twenty-sixth Series (determined in accordance with this Twenty-fourth Supplemental Indenture) and setting forth the amounts of the respective portions thereof representing principal of, premium (if any) and interest on the Bonds of the Twenty-sixth Series.  Each Redemption Demand shall be deemed to constitute a waiver by the Senior Note Trustee, as registered owner of all Bonds of the Twenty-sixth Series then Outstanding, of notice of redemption and call for redemption by the Company or the Corporate Trustee of the Bonds of the Twenty-sixth Series subject to redemption as described in such Redemption Demand.  The Corporate Trustee may conclusively presume the statements contained in each Redemption Demand to be correct (and the Corporate Trustee shall be fully protected in relying thereon).

The Corporate Trustee may conclusively presume that no rescission or annulment of an Acceleration Redemption (in respect of which the Corporate Trustee has received a Redemption Demand) is required unless and until it shall have received a written notice from the Senior Note Trustee, signed by a person purporting to be its duly authorized officer, stating that the acceleration of the Senior Notes has been rescinded or annulled in accordance with the Senior Note Indenture (a “Rescission Notice”).  Each Rescission Notice also shall state the date on which the acceleration of the Senior Notes was rescinded or annulled in accordance with the Senior Note Indenture and, as consequence, the redemption of the Bonds of the Twenty-sixth Series was rescinded or annulled in accordance with this Twenty-fourth Supplemental Indenture.  The Corporate Trustee may conclusively presume the statements contained in any Rescission Notice to be correct (and the Corporate Trustee shall be fully protected in relying thereon).

(II)           It is expressly stated (for the avoidance of any doubt) that, notwithstanding anything herein or in any Bond of the Twenty-sixth Series to the contrary (other than the provisions of subdivision (IV) below), each payment of principal of, premium (if any) or interest on the Bonds of the Twenty-sixth Series that becomes due and payable on any day in accordance with this Twenty-fourth Supplemental Indenture (whether by reason of stated due date, acceleration, redemption or otherwise) shall correspond to, and be equal to the Senior Notes Applicable Share of, a payment of principal of, premium (if any) or interest on the Senior Notes that becomes due and payable on such day in accordance with the Senior Note Indenture.

(III)         The obligation of the Company to make each payment of principal of, premium (if any) or interest on the Bonds of the Twenty-sixth Series that becomes due and payable in accordance with this Twenty-fourth Supplemental Indenture (A) shall be fully satisfied and discharged if the corresponding payment of the principal of, premium (if any) or interest on the Senior Notes shall have been fully paid, or if provision for the full payment of the Senior Notes shall have been made (by depositing moneys sufficient for such full payment with the Senior Note Trustee), in either case under and in accordance with the Senior Note Indenture, and (B) shall be partially satisfied and discharged if the corresponding payment of the principal of, premium (if any) or interest on the Senior Notes shall have been

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partially paid, or if provision for the partial payment of the Senior Notes shall have been made (by depositing moneys sufficient for such partial payment with the Senior Note Trustee), in either case under and in accordance with the Senior Note Indenture (such partial satisfaction and discharge with respect to the Bonds of the Twenty-sixth Series to be in an amount equal to the Senior Notes Applicable Share of the amount of such partial payment or provision for partial payment with respect to the Senior Notes).  The Corporate Trustee may conclusively presume that the obligation of the Company to make payments with respect to the principal of, premium (if any) and interest on the Bonds of the Twenty-sixth Series has been fully satisfied and discharged unless and until the Corporate Trustee shall have received a written notice from the Senior Note Trustee, signed by a person purporting to be its duly authorized officer, stating (i) that the Company has failed to make timely payment in full or in part of an amount of principal of, premium (if any) and/or interest on the Senior Notes which became due and payable in accordance with the Senior Note Indenture, (ii) the amount and date of such payment of principal of, premium (if any) and/or interest on the Senior Notes which the Company has failed to make in accordance with the Senior Note Indenture, and (iii) the amount of principal of, premium (if any) and/or interest on the Bonds of the Twenty-sixth Series which, in accordance with this Twenty-fourth Supplemental Indenture, has not been satisfied and discharged by reason of such failure of the Company.  The Corporate Trustee may conclusively presume the statements contained in any such notice from the Senior Note Trustee to be correct unless and until the Corporate Trustee shall receive a subsequent and/or modified notice from the Senior Note Trustee pursuant to and in accordance with this subdivision (III) (and the Corporate Trustee shall be fully protected in relying thereon).  Without limitation of the foregoing, and for the avoidance of any doubt, it is expressly stated that the Corporate Trustee shall not be responsible for (i) the calculation of interest on the Bonds of the Twenty-sixth Series, or (ii) the determination of any amount (including, without limitation, any principal of, premium (if any) or interest on the Senior Notes) that is payable or paid under the Senior Note Indenture.

(IV)         Nothing herein or in any of the Bonds of the Twenty-sixth Series (including, without limitation, any reference to the principal payable with respect to the Bonds of the Twenty-sixth Series being determined on the basis of the Applicable Share of the principal payable with respect to the Senior Notes) shall, or shall be deemed or construed to, (A) increase the aggregate principal amount of the Bonds of the Twenty-sixth Series that are Outstanding from time to time, (B) cause or permit an amount of principal of the Bonds of the Twenty-sixth Series to be or to become due and payable which, when added to all other principal of such Bonds theretofore paid, exceeds $161,000,000, or (C) cause or permit to be or to become due and payable interest on the Bonds of the Twenty-sixth Series which is payable on any principal of the Bonds of the Twenty-sixth Series that is in excess of the principal of the Bonds of the Twenty-sixth Series as restricted pursuant to the preceding clauses (A) and (B).

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ARTICLE IV

Reservation of Right to Make Amendments

SECTION 4.1  The Company reserves the right, without any consent or other action by holders of Bonds of the Twenty-fourth Series, Bonds of the Twenty-fifth Series or Bonds of the Twenty-sixth Series, or bonds of any subsequent series, to make such amendments to the Mortgage (as supplemented) as shall be necessary in order to cause there to be excluded from the Mortgaged and Pledged Property and the Lien of the Mortgage (as supplemented) at all times, including, without limitation, in the event and following the date that either or both of the Trustees or a receiver of trustee shall enter upon and take possession of the Mortgaged and Pledged Property in the manner provided in Article XIII of the Mortgage (as supplemented) by reason of the occurrence of a Default as defined in Section 65 thereof, all of the Company’s right, title and interest, whenever arising or acquired, in, to and under all accounts (as defined in the Uniform Commercial Code as in effect from time to time in the State of New York), all accounts receivable, all payments for goods sold or leased or for services rendered (whether or not they have been earned by performance), all rights in any merchandise or goods which any of the foregoing may represent, all rights, title, security and guaranties with respect to any or all of the foregoing, and all proceeds (as defined in the Uniform Commercial Code as in effect from time to time in the State of New York) of, and all collections from or with respect to, any or all of the foregoing.

SECTION 4.2  The Company reserves the right, without any consent or other action by holders of Bonds of the Twenty-fourth Series, Bonds of the Twenty-fifth Series or Bonds of the Twenty-sixth Series, or holders of bonds of any subsequent series, to make the following amendments to Section 120 of the Mortgage (as supplemented):  (i) to substitute for the words “adversely affecting any bonds then Outstanding hereunder”, which appear at the end of the last sentence of such Section, the words “which adversely affects the interests of the Holders of any of the bonds then Outstanding in any material respect”; and (ii) to add at the end of the first sentence of such Section the following:

; or the Company may correct or supplement any provision herein or in any supplemental indenture which may be defective or inconsistent with any other provision herein or in any supplemental indenture; or the Company may make other changes to the provisions hereof or of any supplemental indenture or add new provisions hereto or to any supplemental indenture or eliminate provisions herefrom or from any supplemental indenture, provided that the same does not adversely affect the interests of the Holders of any of the bonds then Outstanding in any material respect.

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ARTICLE V

Amendments to Mortgage

SECTION 5.1.  So long as any of the Bonds of the Twenty-fourth, Twenty-fifth or Twenty-sixth Series remain Outstanding, Section 7 of the Mortgage is amended by adding at the end thereof the following additional paragraphs:

If any bonds Outstanding at the date of a Net Earning Certificate (except any for the refunding of which the bonds applied for are to be issued) or any bonds then applied for in pending applications (including the application in connection with which such Net Earning Certificate is made) bear or are to bear interest at a variable rate or variable rates such that the interest requirements with respect to such bonds for any twelve (12) month period prior to the stated maturity date of such bonds are not determinable at the date of such Net Earning Certificate (any such bonds being referred to as “Variable Rate Bonds”), then (in lieu of setting forth the Annual Interest Requirements (as otherwise prescribed by this Section 7), such Net Earning Certificate shall (A) set forth (i)  the sum of the amounts required by clauses (i) through (iv) of paragraph (B) of this Section 7 (in the case of such clauses (i) and (ii), excluding the interest requirements in respect of the Variable Rate Bonds) (the sum of such amounts being referred to herein and to be referred to in such Net Earning Certificate as the “Fixed Rate Interest Amount”), and (ii) the amount (referred to herein and to be referred to in such Net Earning Certificate as the “Maximum Permitted Variable Rate Interest Amount”) by which (x) one-half of the Adjusted Net Earnings of the Company set forth in such Net Earning Certificate, exceeds (y) the Fixed Rate Interest Amount set forth in such Net Earning Certificate, and (ii) if such Net Earning Certificate is accompanied by a certificate of an independent (as hereinafter defined) investment banking firm, signed by a managing director or officer thereof, to the effect that, based upon historical fluctuations in the indices upon which the variable rate or variable rates borne by the Variable Rate Bonds are based, and taking into account the margins to be added to or subtracted from such indices and/or any other adjustments to be made in determining such variable rate or variable rates and prevailing and projected conditions in the markets influencing such indices, such independent (as hereinafter defined) investment banking firm believes (or is of the view), as of the date of such certificate, that the aggregate amount of interest to be payable on all of the Variable Rate Bonds during any period of twelve (12) months prior to the stated maturity date last to occur of any of the Variable Rate Bonds will not exceed the Maximum Permitted Variable Rate Interest Amount (as calculated by the Company in such Net Earning Certificate without any responsibility on the part of such independent (as hereinafter defined) investment banking firm for the calculation thereof), such Net Earning Certificate shall be deemed for all purposes of the Mortgage (including,

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without limitation, Sections 26, 28 and 29 of the Mortgage) to show Adjusted Net Earnings of the Company to be as required by Section 27 of the Mortgage.  As used in this Section 7, “independent” means, with respect to an investment banking firm that provides a certificate pursuant to this Section 7, that:  (i) such investment banking firm is competent to provide such certificate (and such investment banking firm shall be conclusively presumed to be competent to provide such certificate if such investment banking firm is an investment banking firm of nationally recognized standing and engages in interest rate swap transactions in the ordinary course of its business); (ii) such investment banking firm does not have any direct or indirect investment in the Company or in any bonds that, as of the date of such certificate, are Outstanding or the subject of a pending application for authentication and delivery under the Mortgage (including, without limitation, any bonds that are subject of the Net Earning Certificate to which such certificate relates) or in any affiliate of the Company (other than de minimus amounts of loans or securities of the Company or affiliates of the Company held in its or its affiliates’ accounts and any investment in, or ownership of, additional securities or loans of the Company or affiliates of the Company resulting from its market making activities in the ordinary course of its business); (iii) such investment banking firm is not, and none of its officers or directors is, an affiliate of the Company; and (iv) such investment banking firm is not acting as an underwriter with respect to any bonds that are the subject of the Net Earning Certificate to which such certificate relates or as an arranger or provider of the loans, extensions of credit or other securities (if any) for which such bonds are collateral security.

If the Company is a successor corporation (within the meaning of Section 86 of this Indenture), the “Adjusted Net Earnings of the Company” as set forth in each Net Earning Certificate shall be calculated as described in the last two sentences of Section 86 of this Indenture.

SECTION 5.2  So long as any of the Bonds of the Twenty-fourth, Twenty-fifth and Twenty-sixth Series remain Outstanding, Section 27 of the Mortgage is amended by adding at the end thereof the following additional sentence:

As described in the penultimate paragraph of Section 7 hereof, and subject to the conditions therein specified, a Net Earning Certificate shall be deemed to show Adjusted Net Earnings of the Company to be as required by this Section 27 (without any necessity for such Net Earning Certificate to specify Annual Interest Requirements).

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SECTION 5.3  So long as any of the Bonds of the Twenty-fourth, Twenty-fifth and Twenty-sixth Series are Outstanding, Section 86 of the Mortgage is amended by adding at the end thereof the following additional sentences:

For the avoidance of any doubt, it is expressly stated that in the event that a successor corporation (having succeeded to and having been substituted for the Company in accordance with this Section 86) shall exercise any right under this Indenture (whether as to the issuance of additional bonds (including, without limitation, the Bonds of the Twenty-fourth, Twenty-fifth and Twenty-sixth Series), the withdrawal of cash, the release of property, the taking of credit under Section 39 or Section 40 hereof, or otherwise) and a Net Earning Certificate shall be required by the terms of this Indenture in connection therewith, the “Adjusted Net Earnings of the Company” shall be, and shall be stated in such Net Earning Certificate to be, the lesser of (A) the amount (for the applicable period selected in accordance with paragraph (A) of Section 7 of this Indenture) determined in accordance with paragraph (A) of Section 7 of this Indenture (and the other provisions of such Section 7 that are relevant to such paragraph) on the basis of (i) the items set forth in clauses (1), (2), (4) and (6) of paragraph (A) of such Section 7 being such portions of such items of such successor corporation as are reasonably allocated by such successor corporation to or from the Mortgaged and Pledged Property as a plant or plants and an operating system or operating systems (and if, on the date of a Net Earning Certificate, such successor corporation shall be a party to any other general or first mortgage indenture and deed of trust relating to property other than the Mortgaged and Pledged Property and the lien of such other mortgage indenture and deed of trust shall not have been discharged, such reasonable allocation shall be in a manner consistent with the manner of allocation utilized and/or to be utilized by such successor corporation in making calculations of the “Adjusted Net Earnings of the Company” (or other comparable term) under and as defined in such other mortgage indenture and deed of trust), (ii) the item set forth in clause (8) of paragraph (A) of such Section 7 being calculated without regard to income (net) derived from any electric and/or gas utility business of the successor corporation in which the Mortgaged and Pledged Property is not utilized (but otherwise in accordance with such Section 7), and (iii) the item set forth in clause (10) of paragraph (A) of such Section 7 being calculated without regard to sub-clause (b) of such clause and without regard to the proviso to such clause (but otherwise in accordance with such clause), and (B) the amount (for the applicable period selected in accordance with paragraph (A) of Section 7 of this Indenture) determined in accordance with paragraph (A) of Section 7 of this Indenture (and the other provisions of such Section 7 that are relevant to such paragraph) (without any allocation or distinction as to the derivation of the items set forth in any of the clauses of paragraph (A) of such Section 7, other than allocation or distinction between (i) the electric and/or gas utility business or businesses in which such successor corporation is engaged

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(whether or not the Mortgaged and Pledged Property is utilized in connection therewith), and (ii) the other business or businesses in which such successor corporation is engaged (with such other business or businesses being given effect under the items set forth in clauses (8) and (10) of paragraph (A) of such Section 7)).  Each such Net Earning Certificate shall contain a statement of the signers of such Net Earning Certificate that, in the opinion of such signers, the allocations made in the calculations of “Adjusted Net Earnings of the Company” as set forth in such Net Earning Certificate are in accordance with the requirements of the preceding sentence of this Section 86.

ARTICLE VI

Miscellaneous

SECTION 6.1  Except as otherwise expressly provided herein, the terms defined in the Mortgage, as heretofore supplemented, shall, for all purposes of this Twenty-fourth Supplemental Indenture, have the meaning specified in the Mortgage, as heretofore supplemented.

SECTION 6.2  The Trustees hereby accept the trust herein declared, provided, created or supplemented and agree to perform the same upon the terms and conditions herein and in the Mortgage, as heretofore supplemented, set forth and upon the following terms and conditions.

The Trustees shall not be responsible in any manner whatsoever for or in respect of the validity or sufficiency of this Twenty-fourth Supplemental Indenture or for or in respect of the recitals contained herein, all of which recitals are made by the Company solely.  In general, each and every term and condition contained in Article XVII of the Mortgage, as heretofore supplemented, shall apply to and form part of this Twenty-fourth Supplemental Indenture with the same force and effect as if the same were herein set forth in full with such omissions, variations and insertions, if any, as may be appropriate to make the same conform to the provisions of this Twenty-fourth Supplemental Indenture.

SECTION 6.3  Whenever in this Twenty-fourth Supplemental Indenture any of the parties hereto is named or referred to, this shall, subject to the provisions of Articles XVI and XVII of the Mortgage, as heretofore supplemented, be deemed to include the successors and assigns of such party, and all the covenants and agreements in this Twenty-fourth Supplemental Indenture contained by or on behalf of the Company, or by or on behalf of the Trustees shall, subject as aforesaid, bind and inure to the respective benefits of the respective successors and assigns of such parties, whether so expressed or not.

SECTION 6.4  Nothing in this Twenty-fourth Supplemental Indenture, expressed or implied, is intended, or shall be construed, to confer upon, or to give to, any person, firm or corporation, other than the parties hereto and the holders of the bonds and coupons

34

Outstanding under the Indenture, any right, remedy or claim under or by reason of this Twenty-fourth Supplemental Indenture or any covenant, condition, stipulation, promise or agreement hereof, and all the covenants, conditions, stipulations, promises and agreements in this Twenty-fourth Supplemental Indenture contained by or on behalf of the Company shall be for the sole and exclusive benefit of the parties hereto, and of the holders of the bonds and coupons now, or to be, Outstanding under the Indenture.

SECTION 6.5  This Twenty-fourth Supplemental Indenture shall be executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument.

[Signature Pages Follow]

35

IN WITNESS WHEREOF, NORTHWESTERN CORPORATION has caused its name to be hereunto affixed, and this instrument to be signed and sealed by one of its Vice Presidents, and its seal to be attested by its Corporate Secretary or one of its Corporate Assistant Secretaries for and in its behalf, and THE BANK OF NEW YORK, in token of its acceptance of the trust hereby created, has caused its corporate name to be hereunto affixed, and this instrument to be signed and sealed by one of its Vice Presidents or one of its Assistant Vice Presidents, and its corporate seal to be attested by one of its Assistant Vice Presidents, Assistant Secretaries or Assistant Treasurers, and MARYBETH LEWICKI, for all like purposes, has hereunto set her hand and affixed her seal, as of the day and year first above written.

NORTHWESTERN CORPORATION
By:	/s/ Brian B. Bird
	Name:	Brian B. Bird
	Title:	Vice President and
		Chief Financial Officer

[SEAL]

Attest:

/s/ Alan D. Dietrich
Name:	Alan D. Dietrich
Title:	Corporate Secretary
Executed, sealed and delivered by
NORTHWESTERN CORPORATION
in the presence of:
/s/ Michael J. Young
/s/ Michael Devoe

THE BANK OF NEW YORK,
as Corporate Trustee
By:	/s/ Jeremy F. Finkelstein
	Name:	Jeremy F. Finkelstein
	Title:	Assistant Treasurer

[SEAL]

Attest:

/s/ Joseph A. Lloret

Name:  Joseph A. Lloret

Title:  Assistant Treasurer

	/s/ MaryBeth Lewicki
	MARYBETH LEWICKI, as Co-Trustee
Executed, sealed and delivered
by THE BANK OF NEW YORK and
MARYBETH LEWICKI in the presence of:
/s/ Helen L. Li
/s/

STATE OF NEW YORK    )

                                            :  ss.

COUNTY OF NEW YORK)

This instrument was acknowledged before me on this 1st day of November, 2004, by Brian B. Bird, Vice President and Chief Financial Officer, of NORTHWESTERN CORPORATION, a Delaware corporation.

/s/ Keith M. Wixson

 Notary Public, State of New York

 No.  01WI5081858

 Qualified in New York County

 Commission Expires:  July 14, 2007

[SEAL]

STATE OF NEW YORK    )

                                            :  ss.

COUNTY OF NEW YORK)

This instrument was acknowledged before me on this 1st day of November, 2004, by Jeremy F. Finkelstein, Assistant Treasurer of THE BANK OF NEW YORK, a New York corporation.

/s/ Robert Hirsch

 Notary Public, State of New York

 No. 01HI6076679

 Qualified in Rockland County

 Commission Expires: July 1, 2006

[SEAL]

STATE OF NEW YORK     )

                                             :  ss.

COUNTY OF NEW YORK)

This instrument was acknowledged before me on this 1st day of November, 2004, by MARYBETH LEWICKI.

/s/ Robert Hirsch

 Notary Public, State of New York

 No. 01HI6076679

 Qualified in Rockland County

 Commission Expires:  July 1, 2006

[SEAL]

Exhibit A to
Twenty-fourth Supplemental Indenture

Form of Bond of the Twenty-fourth Series

Exhibit A

[FORM OF FIRST MORTGAGE BOND, COLLATERAL (2004) SERIES A, DUE 2009]

THIS BOND IS NOT TRANSFERABLE EXCEPT TO A SUCCESSOR COLLATERAL AGENT UNDER THE COLLATERAL AGREEMENT (AS IDENTIFIED AND DEFINED BELOW).

NORTHWESTERN CORPORATION

First Mortgage Bond,
Collateral (2004) Series A, due 2009

No. R- $

NORTHWESTERN CORPORATION, a corporation organized and existing under the laws of the State of Delaware (the “Company”), for value received, hereby promises to pay to LEHMAN COMMERCIAL PAPER INC., AS COLLATERAL AGENT UNDER THE BOND COLLATERAL AGREEMENT to which reference is hereinafter made, or (subject to the transfer restrictions hereinbefore and hereinafter described) registered assigns, at the office or agency of the Company in the Borough of Manhattan, The City of New York, the sum of                dollars, or, if less, the unpaid principal amount of the Revolving Loans (as hereinafter defined), on November 1, 2009 (the “Revolving Credit Maturity Date”), and in such coin or currency of the United States of America as at the time of payment is legal tender for public and private debts, and to pay to the registered owner interest thereon as hereinafter described in like coin or currency and at such office or agency.

The bonds of the series of which this bond is one have been issued to Lehman Commercial Paper Inc., as collateral agent (together with its successors in such capacity, the “Collateral Agent”) under the Bond Delivery and Collateral Agreement, dated as of November 1, 2004 (as amended or otherwise modified, or as waived, or as replaced, in each case, from time to time in accordance with its terms, the “Collateral Agreement”), between the Company and the Collateral Agent, to secure the obligations of the Company to pay when due the Revolving Credit Applicable Share (as hereinafter defined) of the Revolving Credit Obligations (as hereinafter defined) under the Credit Agreement, dated as of November 1, 2004 (as amended or otherwise modified, or as waived, or as replaced, in each case, from time to time in accordance with its terms, the “Credit Agreement”), among the Company, the several lenders from time to time parties thereto (the “Lenders”), Lehman Brothers Inc. and Deutsche Bank Securities Inc., as joint lead arrangers and joint bookrunners, Deutsche Bank Securities Inc., as syndication agent, Union Bank of California, N.A. and KeyBank National Association, as co-documentation agents, Lehman Commercial Paper Inc., as administrative agent (in such capacity, the “Administrative Agent”) and the Collateral Agent.

The provisions of this bond are continued on the reverse hereof and such continued provisions shall for all purposes have the same effect as though set fully forth at this place.

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This instrument shall not become obligatory until The Bank of New York (successor to Morgan Guaranty Trust Company of New York), the Corporate Trustee under the Mortgage (referred to on the reverse hereof), or its successors thereunder, shall have signed the form of authentication certificate endorsed hereon.

IN WITNESS WHEREOF, NORTHWESTERN CORPORATION has caused this instrument to be signed in its corporate name by its Chairman of the Board or its President or one of its Vice Presidents by his or her signature or a facsimile thereof, and its corporate seal to be impressed or imprinted hereon and attested by its Corporate Secretary or one of its Corporate Assistant Secretaries by his or her signature or a facsimile thereof.

Dated:

NORTHWESTERN CORPORATION
By:
	[Title]

Attest:

[Title]

(Seal)

CORPORATE TRUSTEE’S
AUTHENTICATION CERTIFICATE

This bond is one of the bonds, of the series herein designated, described or provided for in the within-mentioned Mortgage.

THE BANK OF NEW YORK,
as Corporate Trustee
By:
	Authorized Signatory

A-2

[FORM OF REVERSE OF BOND]

General

This bond is one of an issue of bonds of the Company issuable in series and is one of a series known as its First Mortgage Bonds, Collateral (2004) Series A, due 2009 (sometimes herein referred to as the “Bonds of the Twenty-fourth Series”), all bonds of all series issued and to be issued under and equally secured (except in so far as any sinking or other fund, established in accordance with the provisions of the Mortgage hereinafter mentioned, may afford additional security for the bonds of any particular series) by a Mortgage and Deed of Trust (herein, together with any indenture supplemental thereto, including the Twenty-fourth Supplemental Indenture dated as of November 1, 2004 (the “Twenty-fourth Supplemental Indenture”), called the “Mortgage”), dated as of October 1, 1945, executed by The Montana Power Company (NorthWestern Corporation, successor thereunder) to Guaranty Trust Company of New York (The Bank of New York, successor thereunder) and Arthur E. Burke (MaryBeth Lewicki, successor thereunder), as Trustees.  Reference is made to the Mortgage for a description of the property mortgaged and pledged, the nature and extent of the security, the rights of the holders of the bonds and of the Trustees in respect thereof, the duties and immunities of the Trustees, the terms and conditions upon which the bonds are and are to be secured, the circumstances under which additional bonds may be issued and the definition of any capitalized term used herein but not defined herein. With the consent of the Company and to the extent permitted by and as provided in the Mortgage, the rights and obligations of the Company and/or the rights of the holders of the bonds and/or coupons and/or the terms and provisions of the Mortgage may be modified or altered by affirmative vote of the holders of at least 66-2/3% in principal amount of the bonds then Outstanding under the Mortgage and, if the rights of the holders of one or more, but less than all, series of bonds then Outstanding are to be affected, then also by affirmative vote of the holders of at least 66-2/3% in principal amount of the bonds then Outstanding of each series of bonds so to be affected (excluding in any case bonds disqualified from voting by reason of the Company’s interest therein as provided in the Mortgage); provided that, without the consent of the holder hereof, no such modification or alteration shall, among other things, impair or affect the right of the holder to receive payment of the principal of and interest on this bond, on or after the respective due dates expressed herein, or permit the creation of any lien equal or prior to the lien of the Mortgage or deprive the holder of the benefit of a lien on the mortgaged and pledged property.

The principal hereof may be declared or may become due prior to the maturity date hereinbefore named on the conditions, in the manner and at the time set forth in the Mortgage, upon the occurrence of a default as in the Mortgage provided.

No recourse shall be had for the payment of the principal of or interest on this bond against any incorporator or any past, present or future subscriber to the capital stock, stockholder, officer or director of the Company or of any predecessor or successor

A-3

corporation, as such, either directly or through the Company or any predecessor or successor corporation, under any rule of law, statute or constitution or by the enforcement of any assessment or otherwise, all such liability of incorporators, subscribers, stockholders, officers and directors being released by the holder or owner hereof by the acceptance of this bond and being likewise waived and released by the terms of the Mortgage.

Transfer Provisions and Restrictions

Bonds of the Twenty-fourth Series shall not be transferable except to any successor Collateral Agent under the Collateral Agreement.  As a condition precedent to any transfer of the Bonds of the Twenty-fourth Series by the Collateral Agent, the Collateral Agent shall submit to the Company, the Corporate Trustee and, if applicable, any bond registrar or transfer agent for the Bonds of the Twenty-fourth Series (in addition to all other documents and instruments required to be submitted pursuant to the Mortgage) a certificate of the Collateral Agent, signed by a person purporting to be its duly authorized officer, certifying that the transferee in such transfer is a successor Collateral Agent under the Collateral Agreement (and the Corporate Trustee may conclusively presume the statements in any such certificate of the Collateral Agent to be correct and shall be fully protected in relying thereon).

Any such transfer is to be made as prescribed in the Mortgage by the registered owner hereof in person, or by his duly authorized attorney, at the office or agency of the Company in the Borough of Manhattan, The City of New York, upon surrender and cancellation of the applicable Bond of the Twenty-fourth Series, and, thereupon, a new fully registered temporary or definitive bond of the same series for a like principal amount will be issued to the transferee in exchange therefor as provided in the Mortgage.  The Company and the Trustees may deem and treat the person in whose name any Bond of the Twenty-fourth Series is registered as the absolute owner thereof for the purpose of receiving payment and for all other purposes and neither the Company nor the Trustees shall be affected by any notice to the contrary.

In the manner prescribed in the Mortgage, Bonds of the Twenty-fourth Series upon surrender thereof, for cancellation, at the office or agency of the Company in the Borough of Manhattan, The City of New York, are exchangeable for a like aggregate principal amount of registered bonds of the same series of other authorized denominations.

As provided in the Mortgage, the Company shall not be required to make transfers or exchanges of bonds of any series for a period of ten days next preceding any interest payment date for bonds of said series, or next preceding any designation of bonds of said series to be redeemed; provided, however, that pursuant to a waiver by the Company in the Twenty-fourth Supplemental Indenture, these restrictions shall not be applicable to any transfer of the Bonds of the Twenty-fourth Series to a successor Collateral Agent under the Collateral Agreement.

A-4

Principal

The unpaid principal of the Bonds of the Twenty-fourth Series, of which this bond is one, is scheduled to be paid on the Revolving Credit Maturity Date.  From time to time after the issuance of the Bonds of the Twenty-fourth Series, and as Revolving Loans (as hereinafter defined) are prepaid and reborrowed subject to and in accordance with the Credit Agreement, (i) for purposes of determining the amount of principal payable by the Company with respect to the Bonds of the Twenty-fourth Series, the unpaid principal amount of the Bonds of the Twenty-fourth Series at any time shall be deemed to be equal to the Revolving Credit Applicable Share of the unpaid principal amount of the Revolving Loans at such time, plus, if an acceleration of the Revolving Loans shall be in effect in accordance with the Credit Agreement at such time, the amount of cash collateral required to be provided by the Company pursuant to Section 8 of the Credit Agreement in respect of Letters of Credit, and (ii) for all other purposes of the Indenture (including, without limitation, the determination of the amount of principal on which interest is payable and the determination of the principal amount with respect to which the Collateral Agent, as registered owner, is entitled to vote or otherwise exercise rights as registered owner), the Bonds of the Twenty-fourth Series shall be deemed to be “Outstanding” at any time in an aggregate principal amount equal to the Maximum Principal Amount at such time.  The Maximum Principal Amount on and as of the date of original issuance of the Bonds of the Twenty-fourth Series shall be $90,000,000 and thereafter shall be reduced from time to time upon each Revolving Credit Commitment Redemption and each Revolving Credit Event of Default Commitment Termination Redemption (as hereinafter defined), in each case, by an amount equal to the aggregate principal amount of the Bonds of the Twenty-fourth Series that are deemed to have been redeemed pursuant to such Revolving Credit Commitment Redemption or such Revolving Credit Event of Default Commitment Termination Redemption.

Interest

The unpaid principal amount of the Bonds of the Twenty-fourth Series, of which this bond is one, bears interest (i) with respect to the portion or amount of such principal that is equal to the principal amount of Revolving Loans, at one or more variable interest rates per annum which rate or rates for each day shall be equal to the rate or rates per annum borne by Revolving Loans in accordance with the Credit Agreement for such day (calculated in the manner provided in the Credit Agreement for the calculation of interest on Revolving Credit Loans), payable on each day on which interest is payable on Revolving Loans in accordance with the Credit Agreement (and in an amount equal to the Revolving Credit Applicable Share of the amount of interest that is payable on Revolving Loans on such day in accordance with the Credit Agreement), (ii) with respect to the portion or amount of such principal (in excess of the amount described in the preceding clause (i)) that is equal to the Revolving Credit Applicable Share of the unused Total Revolving Credit Commitments (as defined in the Credit Agreement), at one or more variable interest rate per annum which rate or rates for any day shall be equal to the rate or rates per annum at which commitment fees are payable under the Credit Agreement on the unused Total Revolving Credit Commitments, payable on

A-5

each day on which commitment fees are payable under the Credit Agreement (and in an amount equal to the Revolving Credit Applicable Share of the amount of commitment fees that is payable under the Credit Agreement on such day), and (iii) with respect to the portion or amount of such principal (in excess of the amounts described in the preceding clauses (i) and (ii)) that is equal to the Revolving Credit Applicable Share of the amount available to be drawn under Letters of Credit (as defined in the Credit Agreement), at one or more variable interest rates per annum which rate or rates for each day shall be equal to the rate or rates per annum at which letter of credit fees are payable under the Credit Agreement on the amount available to be drawn under Letters of Credit, payable on each day on which letter of credit fees are payable under the Credit Agreement (and in an amount equal to the Revolving Credit Applicable Share of the amount of letter of credit fees that is payable under the Credit Agreement on such day), in each case, to the Collateral Agent, as the registered owner, without regard to, or necessity for, any record date.

Revolving Credit Applicable Share

As used herein, “Revolving Credit Applicable Share” means, as of any day, a fraction (expressed as a percentage rounded to the second place), (i) the numerator of which is the aggregate principal amount of the Bonds of the Twenty-fourth Series that are Outstanding on such day, and (ii) the denominator of which is the sum of (a) the aggregate principal amount of the Bonds of the Twenty-fourth Series that are Outstanding on such day, plus (b) the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series A, due 2009, of the Company (the “South Dakota Revolving Credit Bonds”) that are outstanding on such day under the Company’s South Dakota Mortgage (as defined in the Twenty-fourth Supplemental Indenture).  Simultaneously with the issuance and registration of the Bonds of the Twenty-fourth Series in the name of the Collateral Agent (for the same purpose), the South Dakota Revolving Credit Bonds were issued to the Collateral Agent to secure the Revolving Credit Obligations under the Credit Agreement.

Revolving Credit Obligations and Revolving Loans

As used herein, “Revolving Credit Obligations” means the obligations of the Company (A) to pay (i) principal of and interest on (a) the Revolving Credit Loans (as defined in the Credit Agreement), (b) the Swing Line Loans (as defined in the Credit Agreement), and (c) drawings under Letters of Credit (as defined in the Credit Agreement) that are not reimbursed pursuant to and in accordance with the Credit Agreement (collectively, “Revolving Loans”), (ii) commitment fees on the average daily amount of the unused Total Revolving Credit Commitments (as defined in the Credit Agreement); and (iii) letter of credit fees on the amount available to be drawn under Letters of Credit (as defined in the Credit Agreement) and (B) to cash collateralize Letters of Credit pursuant to and in accordance with Section 8 of the Credit Agreement.

A-6

Redemption

Bonds of the Twenty-fourth Series, of which this bond is one, shall be subject to redemption as follows (but shall not otherwise be or become subject to redemption, whether at the option of the holders thereof or the Company or pursuant to any other requirements or provisions of the Indenture):  (A) on each day on which there is a permanent reduction or termination of the Revolving Credit Commitments (as defined in the Credit Agreement) pursuant to Section 2.10 of the Credit Agreement, Bonds of the Twenty-fourth Series shall be deemed to have been redeemed in an aggregate principal amount equal to the Revolving Credit Applicable Share of the amount of such permanent reduction or termination of the Revolving Credit Commitments pursuant to such Section 2.10 (a “Revolving Credit Commitment Redemption”); (B) on each day on which the Revolving Credit Commitments are permanently terminated pursuant to Section 8 of the Credit Agreement, Bonds of the Twenty-fourth Series shall be deemed to have been redeemed in an aggregate principal amount which, after giving effect to such termination, results in the Maximum Principal Amount of the Bonds of Twenty-fourth Series being equal to the Revolving Credit Applicable Share of the sum of the principal amount of the Revolving Loans then outstanding under the Credit Agreement and the amount then available to be drawn under Letters of Credit (a “Revolving Credit Event of Default Commitment Termination Redemption”); and (C) on each day on which the Revolving Loans are accelerated in accordance with the Credit Agreement (an “Acceleration Redemption Date”), the entire aggregate principal amount of the Bonds of the Twenty-fourth Series shall be subject to mandatory redemption by the Company (an “Acceleration Redemption”); in each case, without any necessity for notice or call by the Company or by the Corporate Trustee (such notice and call being waived by the registered owners of the Bonds of the Twenty-fourth Series by the acceptance of the Bonds of the Twenty-fourth Series and in connection with each Redemption Demand hereinafter described); provided, however, that in the event of a reinstatement of the Revolving Credit Commitments or a rescission or annulment of the acceleration of the Revolving Loans pursuant to the Credit Agreement or otherwise, the related Revolving Credit Event of Default Commitment Termination Redemption or the related Acceleration Redemption shall be deemed to be rescinded or annulled, without prejudice to the occurrence of another Revolving Credit Event of Default Commitment Termination Redemption or another Acceleration Redemption upon and by reason of a subsequent termination of the Revolving Credit Commitments pursuant to Section 8 of the Credit Agreement or another acceleration of the Revolving Loans in accordance with the Credit Agreement.  Acceleration Redemption of the Bonds of the Twenty-fourth Series on an Acceleration Redemption Date shall be at a redemption price equal to the principal amount (determined in accordance with the Twenty-fourth Supplemental Indenture) of the Bonds of the Twenty-fourth Series that is then payable by the Company (without premium), together with interest accrued on said principal to and including such Acceleration Redemption Date (collectively, an “Acceleration Redemption Amount”); and such Acceleration Redemption Amount shall be due and payable on such Acceleration Redemption Date.  In the event of any failure by the Company to pay when due an Acceleration Redemption Amount, interest shall accrue on such unpaid Acceleration Redemption Amount at the rates (and in amounts

A-7

equal to the Revolving Credit Applicable Share of the amounts) of interest that accrue on the corresponding unpaid principal of and interest on the Revolving Loans in accordance with the Credit Agreement.

The Corporate Trustee may conclusively presume that no redemption of Bonds of the Twenty-fourth Series is deemed to have occurred or resulted in a reduction of the Maximum Principal Amount (in the case of a Revolving Credit Commitment Redemption or a Revolving Credit Event of Default Commitment Termination Redemption) or is required to occur (in the case of an Acceleration Redemption) unless and until it shall have received a written notice from the Administrative Agent, signed by a person purporting to be its duly authorized officer, stating that the Revolving Credit Commitments have been permanently reduced or terminated pursuant to Section 2.10 of the Credit Agreement or the Revolving Credit Commitments have been permanently terminated pursuant to Section 8 of the Credit Agreement or the Revolving Loans have been accelerated in accordance with the Credit Agreement (a “Redemption Demand”).  Each Redemption Demand also shall (i) state the date on which the Revolving Credit Commitments were permanently reduced or terminated pursuant to Section 2.10 of the Credit Agreement or the Revolving Credit Commitments were permanently terminated pursuant to Section 8 of the Credit Agreement or the Revolving Loans were accelerated, (ii) the amount by which the Revolving Credit Commitments were so permanently reduced or terminated and the Maximum Principal Amount (determined in accordance with the Twenty-fourth Supplemental Indenture) after giving effect to the related and deemed redemption of Bonds of the Twenty-fourth Series or the principal amount of the Revolving Loans subject to acceleration on such date, (iii) the principal amount of Bonds of the Twenty-fourth Series that are deemed to have been redeemed or are to be redeemed on such date in accordance with the Twenty-fourth Supplemental Indenture by reason of such permanent reduction or termination of the Revolving Credit Commitments and such reduction of the Maximum Principal Amount or such acceleration of the Revolving Loans, and (iv) in the case of an Acceleration Redemption, the Acceleration Redemption Amount payable with respect to the Bonds of the Twenty-fourth Series (determined in accordance with the Twenty-fourth Supplemental Indenture) and setting forth the amounts of the respective portions thereof representing principal of and interest on the Bonds of the Twenty-fourth Series.  Each Redemption Demand shall be deemed to constitute a written waiver by the Collateral Agent, as registered owner of all Bonds of the Twenty-fourth Series then Outstanding, of notice of redemption and call for redemption by the Company or the Corporate Trustee of the Bonds of the Twenty-fourth Series subject to redemption as described in such Redemption Demand.  The Corporate Trustee may conclusively presume the statements contained in each Redemption Demand to be correct (and the Corporate Trustee shall be fully protected in relying thereon).

The Corporate Trustee may conclusively presume that no rescission or annulment of a Revolving Credit Event of Default Commitment Termination Redemption or an Acceleration Redemption (in respect of which the Corporate Trustee has received a Redemption Demand) is required unless and until it shall have received a written notice from the Administrative Agent, signed by a person purporting to be its duly authorized officer,

A-8

stating that the termination of the Revolving Credit Commitments pursuant to Section 8 of the Credit Agreement or the acceleration of the Revolving Loans has been rescinded or annulled in accordance with the Credit Agreement or otherwise (a “Rescission Notice”).  Each Rescission Notice also shall state the date on which the termination of the Revolving Credit Commitments pursuant to Section 8 of the Credit Agreement or the acceleration of the Revolving Loans was rescinded or annulled in accordance with the Credit Agreement or otherwise and, as consequence, the redemption of the Bonds of the Twenty-fourth Series was rescinded or annulled in accordance with the Twenty-fourth Supplemental Indenture.  The Corporate Trustee may conclusively presume the statements contained in any Rescission Notice to be correct (and the Corporate Trustee shall be fully protected in relying thereon).

Additional Terms

Bonds of the Twenty-fourth Series shall be subject to the following other terms and conditions:

(I)            It is expressly stated (for the avoidance of any doubt) that, notwithstanding anything in this bond or in the Twenty-fourth Supplemental Indenture to the contrary (other than the provisions of subdivision III below), each payment of principal of or interest on the Bonds of the Twenty-fourth Series that becomes due and payable on any day (whether by reason of stated due date, acceleration, redemption or otherwise) shall correspond to, and be equal to the Revolving Credit Applicable Share of, a payment of Revolving Credit Obligations that becomes due and payable on such day in accordance with the Credit Agreement.

(II)           The obligation of the Company to make each payment of principal of or interest on the Bonds of the Twenty-fourth Series that becomes due and payable in accordance with the Twenty-fourth Supplemental Indenture (A) shall be fully satisfied and discharged if the corresponding payment of the Revolving Credit Obligations shall have been fully paid under and in accordance with the Credit Agreement, and (B) shall be partially satisfied and discharged if the corresponding payment of the Revolving Credit Obligations shall have been partially paid under and in accordance with the Credit Agreement (such partial satisfaction and discharge with respect to the Bonds of the Twenty-fourth Series to be in an amount equal to the Revolving Credit Applicable Share of the amount of such partial payment with respect to the Revolving Credit Obligations).

(III)         Nothing in any of the Bonds of the Twenty-fourth Series (including, without limitation, any reference to the principal payable with respect to the Bonds of the Twenty-fourth Series being determined on the basis of the Revolving Credit Applicable Share of the principal payable with respect to the Revolving Credit Obligations) shall, or shall be deemed or construed to, increase the aggregate principal amount of the Bonds of the Twenty-fourth Series that are Outstanding at any time to an amount in excess of the Maximum Principal Amount as in effect at such time.

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Exhibit B to
Twenty-fourth Supplemental Indenture

Form of Bond of the Twenty-fifth Series

Exhibit B

[FORM OF FIRST MORTGAGE BOND, COLLATERAL (2004) SERIES B, DUE 20011]

THIS BOND IS NOT TRANSFERABLE EXCEPT TO A SUCCESSOR
COLLATERAL AGENT UNDER THE COLLATERAL AGREEMENT
(AS IDENTIFIED AND DEFINED BELOW).

NORTHWESTERN CORPORATION

First Mortgage Bond,
Collateral (2004) Series B, due 2011

No. R- $

NORTHWESTERN CORPORATION, a corporation organized and existing under the laws of the State of Delaware (the “Company”), for value received, hereby promises to pay to LEHMAN COMMERCIAL PAPER INC., AS COLLATERAL AGENT UNDER THE BOND DELIVERY AND COLLATERAL AGREEMENT to which reference is hereinafter made, or (subject to the transfer restrictions hereinabove and hereinafter described) registered assigns, at the office or agency of the Company in the Borough of Manhattan, The City of New York, the sum of             dollars, in installments prior to, and the balance on, November 1, 2011 (the “Term Loan Maturity Date”), in each case, in such amount as is hereinafter described for such installment or such balance, as applicable, and in such coin or currency of the United States of America as at the time of payment is legal tender for public and private debts, and to pay to the registered owner interest thereon as hereinafter described in like coin or currency and at such office or agency.

The bonds of the series of which this bond is one have been issued to Lehman Commercial Paper Inc., as collateral agent (together with its successors in such capacity, the “Collateral Agent”) under the Bond Delivery and Collateral Agreement, dated as of November 1, 2004 (as amended or otherwise modified, or as waived, or as replaced, in each case, from time to time in accordance with its terms, the “Collateral Agreement”), between the Company and the Collateral Agent, to secure the obligations of the Company to pay when due the Term Loan Applicable Share (as hereinafter defined) of the principal of and interest on the term loans (the “Loans”) made and outstanding under the Credit Agreement, dated as of November 1, 2004 (as amended or otherwise modified, or as waived, or as replaced, in each case, from time to time in accordance with its terms, the “Credit Agreement”), among the Company, the several lenders from time to time parties thereto (the “Lenders”), Lehman Brothers Inc. and Deutsche Bank Securities Inc., as joint lead arrangers and joint bookrunners, Deutsche Bank Securities Inc., as syndication agent, Union Bank of California, N.A. and KeyBank National Association, as co-documentation agents, Lehman Commercial Paper Inc., as administrative agent (in such capacity, the “Administrative Agent”) and the Collateral Agent.

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The provisions of this bond are continued on the reverse hereof and such continued provisions shall for all purposes have the same effect as though set fully forth at this place.

This instrument shall not become obligatory until The Bank of New York (successor to Morgan Guaranty Trust Company of New York), the Corporate Trustee under the Mortgage (referred to on the reverse hereof), or its successors thereunder, shall have signed the form of authentication certificate endorsed hereon.

IN WITNESS WHEREOF, NORTHWESTERN CORPORATION has caused this instrument to be signed in its corporate name by its Chairman of the Board or its President or one of its Vice Presidents by his or her signature or a facsimile thereof, and its corporate seal to be impressed or imprinted hereon and attested by its Corporate Secretary or one of its Corporate Assistant Secretaries by his or her signature or a facsimile thereof.

Dated:

NORTHWESTERN CORPORATION
By:
	[Title]

Attest:

[Title]

(Seal)

CORPORATE TRUSTEE’S
AUTHENTICATION CERTIFICATE

This bond is one of the bonds, of the series herein designated, described or provided for in the within-mentioned Mortgage.

THE BANK OF NEW YORK,
as Corporate Trustee
By:
	Authorized Signatory

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[FORM OF REVERSE OF BOND]

General

This bond is one of an issue of bonds of the Company issuable in series and is one of a series known as its First Mortgage Bonds, Collateral (2004) Series B, due 2011 (sometimes herein referred to as the “Bonds of the Twenty-fifth Series”), all bonds of all series issued and to be issued under and equally secured (except in so far as any sinking or other fund, established in accordance with the provisions of the Mortgage hereinafter mentioned, may afford additional security for the bonds of any particular series) by a Mortgage and Deed of Trust (herein, together with any indenture supplemental thereto, including the Twenty-fourth Supplemental Indenture dated as of November 1, 2004 (the “Twenty-fourth Supplemental Indenture”), called the “Mortgage”), dated as of October 1, 1945, executed by The Montana Power Company (NorthWestern Corporation, successor thereunder) to Guaranty Trust Company of New York (The Bank of New York, successor thereunder) and Arthur E. Burke (MaryBeth Lewicki, successor thereunder), as Trustees.  Reference is made to the Mortgage for a description of the property mortgaged and pledged, the nature and extent of the security, the rights of the holders of the bonds and of the Trustees in respect thereof, the duties and immunities of the Trustees, the terms and conditions upon which the bonds are and are to be secured, the circumstances under which additional bonds may be issued and the definition of any capitalized term used herein but not defined herein. With the consent of the Company and to the extent permitted by and as provided in the Mortgage, the rights and obligations of the Company and/or the rights of the holders of the bonds and/or coupons and/or the terms and provisions of the Mortgage may be modified or altered by affirmative vote of the holders of at least 66-2/3% in principal amount of the bonds then Outstanding under the Mortgage and, if the rights of the holders of one or more, but less than all, series of bonds then Outstanding are to be affected, then also by affirmative vote of the holders of at least 66-2/3% in principal amount of the bonds then Outstanding of each series of bonds so to be affected (excluding in any case bonds disqualified from voting by reason of the Company’s interest therein as provided in the Mortgage); provided that, without the consent of the holder hereof, no such modification or alteration shall, among other things, impair or affect the right of the holder to receive payment of the principal of and interest on this bond, on or after the respective due dates expressed herein, or permit the creation of any lien equal or prior to the lien of the Mortgage or deprive the holder of the benefit of a lien on the mortgaged and pledged property.

The principal hereof may be declared or may become due prior to the maturity date hereinbefore named on the conditions, in the manner and at the time set forth in the Mortgage, upon the occurrence of a default as in the Mortgage provided.

No recourse shall be had for the payment of the principal of or interest on this bond against any incorporator or any past, present or future subscriber to the capital stock, stockholder, officer or director of the Company or of any predecessor or successor corporation, as such, either directly or through the Company or any predecessor or successor

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corporation, under any rule of law, statute or constitution or by the enforcement of any assessment or otherwise, all such liability of incorporators, subscribers, stockholders, officers and directors being released by the holder or owner hereof by the acceptance of this bond and being likewise waived and released by the terms of the Mortgage.

Transfer Provisions and Restrictions

Bonds of the Twenty-fifth Series shall not be transferable except to any successor Collateral Agent under the Collateral Agreement.  As a condition precedent to any transfer of the Bonds of the Twenty-fifth Series by the Collateral Agent, the Collateral Agent shall submit to the Company, the Corporate Trustee and, if applicable, any bond registrar or transfer agent for the Bonds of the Twenty-fifth Series (in addition to all other documents and instruments required to be submitted pursuant to the Mortgage) a certificate of the Collateral Agent, signed by a person purporting to be its duly authorized officer, certifying that the transferee in such transfer is a successor Collateral Agent under the Collateral Agreement (and the Corporate Trustee may conclusively presume the statements in any such certificate of the Collateral Agent to be correct and shall be fully protected in relying thereon).

Any such transfer is to be made as prescribed in the Mortgage by the registered owner hereof in person, or by his duly authorized attorney, at the office or agency of the Company in the Borough of Manhattan, The City of New York, upon surrender and cancellation of the applicable Bond of the Twenty-fifth Series, and, thereupon, a new fully registered temporary or definitive bond of the same series for a like principal amount will be issued to the transferee in exchange therefor as provided in the Mortgage.  The Company and the Trustees may deem and treat the person in whose name any Bond of the Twenty-fifth Series is registered as the absolute owner thereof for the purpose of receiving payment and for all other purposes and neither the Company nor the Trustees shall be affected by any notice to the contrary.

In the manner prescribed in the Mortgage, Bonds of the Twenty-fifth Series upon surrender thereof, for cancellation, at the office or agency of the Company in the Borough of Manhattan, The City of New York, are exchangeable for a like aggregate principal amount of registered bonds of the same series of other authorized denominations.

As provided in the Mortgage, the Company shall not be required to make transfers or exchanges of bonds of any series for a period of ten days next preceding any interest payment date for bonds of said series, or next preceding any designation of bonds of said series to be redeemed; provided, however, that pursuant to a waiver by the Company in the Twenty-fourth Supplemental Indenture, these restrictions shall not be applicable to any transfer of the Bonds of the Twenty-fifth Series to a successor Collateral Agent under the Collateral Agreement.

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Principal

Principal of the Bonds of the Twenty-fifth Series, of which this bond is one, is scheduled to be paid as follows:  (i) an installment of the principal of the Bonds of the Twenty-fifth Series in an amount equal to $180,000 (said amount representing one quarter of one percent (0.25%) of the original aggregate principal amount of the Bonds of the Twenty-fifth Series) to be payable on each March 31, June 30, September 30 and December 31, commencing March 31, 2005 and continuing through and including September 30, 2010, (ii) an installment of the principal amount of the Bonds of the Twenty-fifth Series in an amount equal to $16,920,000 (said amount representing twenty-three and one-half percent (23.5%) of the original aggregate principal amount of the Bonds of the Twenty-fifth Series) to be payable on December 31, 2010, March 31, 2011 and June 30, 2011, and (iii) the balance of the principal of the Bonds of the Twenty-fifth Series to be payable on the Term Loan Maturity Date; in each case, unless an equal installment or balance of the principal of the Term Loans is not due and payable on such day or on the Term Loan Maturity Date, as applicable, in accordance with the Credit Agreement by reason of prior prepayment of the Term Loans (in which event, there shall be due and payable on the Bonds of the Twenty-fifth Series on such day or on the Term Loan Maturity Date, as applicable, an amount of principal of said Bonds equal to the Term Loan Applicable Share of the amount of principal of the Term Loans that is payable on such day or on the Term Loan Maturity Date, as applicable, in accordance with the Credit Agreement).

Interest

The unpaid principal amount of the Bonds of the Twenty-fifth Series, of which this bond is one, bears interest at one or more variable interest rates per annum which rate or rates for each day shall be equal to the rate or rates per annum borne by the Term Loans in accordance with the Credit Agreement for such day (calculated in the manner provided in the Credit Agreement for the calculation of interest on the Term Loans), payable on each day on which interest is payable on the Term Loans in accordance with the Credit Agreement (and in an amount equal to the Term Loan Applicable Share of the amount of interest that is payable on the Term Loans on such day in accordance with the Credit Agreement) to the Collateral Agent, as the registered owner, without regard to, or necessity for, any record date.

Term Loan Applicable Share

As used herein, “Term Loan Applicable Share” means, as of any day, a fraction (expressed as a percentage rounded to the second decimal place), (i) the numerator of which is the aggregate principal amount of the Bonds of the Twenty-fifth Series that are Outstanding on such day, and (ii) the denominator of which is the sum of (a) the aggregate principal amount of the Bonds of the Twenty-fifth Series that are Outstanding on such day, plus (b) the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series B, due 2011, of the Company (the “South Dakota Term Loan Bonds”) that are outstanding on such day under the Company’s South Dakota Mortgage (as defined in the Twenty-fourth Supplemental Indenture).  Simultaneously with the issuance and registration

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of the Bonds of the Twenty-fifth Series in the name of the Collateral Agent (for the same purpose), the South Dakota Term Loan Bonds were issued to the Collateral Agent to secure the obligations of the Company to pay when due a portion of the principal of and interest on the Term Loans.

Redemption

Bonds of the Twenty-fifth Series, of which this bond is one, shall be subject to redemption as follows (but shall not otherwise be or become subject to redemption, whether at the option of the holders thereof or the Company or pursuant to any other requirements or provisions of the Indenture):  (A) on each day on which the Term Loans are prepaid in accordance with the Credit Agreement, Bonds of the Twenty-fifth Series shall be deemed to have been redeemed in an aggregate principal amount equal to the Term Loan Applicable Share of the aggregate principal amount of the Term Loans that are so prepaid on such day (a “Term Loan Prepayment Redemption”); and (B) on each day on which the Term Loans are accelerated in accordance with the Credit Agreement (an “Acceleration Redemption Date”), the entire aggregate principal amount of the Bonds of the Twenty-fifth Series shall be subject to mandatory redemption by the Company (the “Acceleration Redemption”); in each case, without any necessity for notice or call by the Company or by the Corporate Trustee (such notice and call being waived by the registered owners of the Bonds of the Twenty-fifth Series by the acceptance of the Bonds of the Twenty-fifth Series and in connection with each Redemption Demand hereinafter described); provided, however, that in the event of a rescission or annulment of the acceleration of the Term Loans pursuant to the Credit Agreement or otherwise, the related Acceleration Redemption shall be deemed to be rescinded or annulled (without prejudice to the occurrence of another Acceleration Redemption upon and by reason of a subsequent acceleration of the Term Loans in accordance with the Credit Agreement).  Acceleration Redemption of Bonds of the Twenty-fifth Series on an Acceleration Redemption Date shall be at a redemption price equal to the principal amount of the Bonds of the Twenty-fifth Series (without premium), together with interest accrued on said principal to and including such Acceleration Redemption Date (collectively, an “Acceleration Redemption Amount”); and such Acceleration Redemption Amount shall be due and payable on the Bonds of the Twenty-fifth Series on such Acceleration Redemption Date.  In the event of any failure by the Company to pay when due the Acceleration Redemption Amount with respect to an Acceleration Redemption of Bonds of the Twenty-fifth Series, interest shall accrue on such unpaid Acceleration Redemption Amount at the rates (and in amounts equal to the Term Loan Applicable Share of the amounts) of interest that accrue on the corresponding unpaid principal of and interest on the Term Loans in accordance with the Credit Agreement.

The Corporate Trustee may conclusively presume that no redemption of Bonds of the Twenty-fifth Series is deemed to have occurred (in the case of a Term Loan Prepayment Redemption) or is required (in the case of an Acceleration Redemption) unless and until it shall have received a written notice from the Administrative Agent, signed by a person purporting to be its duly authorized officer, stating that Term Loans have been

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prepaid or have been accelerated, in either case, in  accordance with the Credit Agreement (a “Redemption Demand”).  Each Redemption Demand also shall state (i) the date on which the Term Loans were prepaid or accelerated in accordance with the Credit Agreement, (ii) the principal amount of the Term Loans so prepaid or accelerated on such date, (iii) the principal amount of Bonds of the Twenty-fifth Series that are deemed to have been redeemed or are to be redeemed on such date in accordance with the Twenty-fourth Supplemental Indenture by reason of such prepayment or acceleration, and (iv)  in the case of an Acceleration Redemption, the Redemption Amount payable with respect to the Bonds of the Twenty-fifth Series (determined in accordance with the Twenty-fourth Supplemental Indenture) and setting forth the amounts of the respective portions thereof representing principal of and interest on the Bonds of the Twenty-fifth Series.  Each Redemption Demand shall be deemed to constitute a written waiver by the Collateral Agent, as registered owner of all Bonds of the Twenty-fifth Series then Outstanding, of notice of redemption and call for redemption by the Company or the Corporate Trustee of the Bonds of the Twenty-fifth Series deemed redeemed or subject to redemption as described in such Redemption Demand.  The Corporate Trustee may conclusively presume the statements contained in each Redemption Demand to be correct (and the Corporate Trustee shall be fully protected in relying thereon).

The Corporate Trustee may conclusively presume that no rescission or annulment of the Acceleration Redemption (in respect of which the Corporate Trustee has received a Redemption Demand) is required unless and until it shall have received a written notice from the Administrative Agent, signed by a person purporting to be its duly authorized officer, stating that the acceleration of the Term Loans has been rescinded or annulled in accordance with the Credit Agreement or otherwise (a “Rescission Notice”).  Each Rescission Notice also shall state the date on which the acceleration of the Term Loans was rescinded or annulled in accordance with the Credit Agreement or otherwise and, as consequence, the redemption of the Bonds of the Twenty-fifth Series was rescinded or annulled in accordance with the Twenty-fourth Supplemental Indenture.  The Corporate Trustee may conclusively presume the statements contained in any Rescission Notice to be correct (and the Corporate Trustee shall be fully protected in relying thereon).

Additional Terms

Bonds of the Twenty-fifth Series, of which this bond is one, shall be subject to the following other terms and conditions:

(I)            It is expressly stated (for the avoidance of any doubt) that, notwithstanding anything in this bond or the Twenty-fourth Supplemental Indenture to the contrary (other than the provisions of subdivision III below) each payment of principal of or interest on the Bonds of the Twenty-fifth Series that becomes due and payable on any day (whether by reason of stated due date, acceleration, redemption or otherwise) shall correspond to, and be equal to the Term Loan Applicable Share of, a payment of principal of or interest on the Term Loans that becomes due and payable on such day in accordance with the Credit Agreement.

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(II)           The obligation of the Company to make each payment of principal of or interest on the Bonds of the Twenty-fifth Series that becomes due and payable in accordance with the Twenty-fourth Supplemental Indenture (A) shall be fully satisfied and discharged if the corresponding payment of the principal of or interest on the Term Loans shall have been fully paid under and in accordance with the Credit Agreement, and (B) shall be partially satisfied and discharged if the corresponding payment of the principal of or interest on the Term Loans shall have been partially paid under and in accordance with the Credit Agreement (such partial satisfaction and discharge with respect to the Bonds of the Twenty-fifth Series to be in an amount equal to the Term Loan Applicable Share of the amount of such partial payment with respect to the Term Loans).

(III)         Nothing in any of the Bonds of the Twenty-fifth Series (including, without limitation, any reference to the principal payable with respect to the Bonds of the Twenty-fifth Series being determined on the basis of the Term Loan Applicable Share of the principal payable with respect to the Term Loans) shall, or shall be deemed or construed to, (A) increase the aggregate principal amount of the Bonds of the Twenty-fifth Series that are Outstanding from time to time, (B) cause or permit an amount of principal of the Bonds of the Twenty-fifth Series to be or to become due and payable which, when added to all other principal of such Bonds theretofore paid, exceeds $72,000,000, or (C) cause or permit to be or to become due and payable interest on the Bonds of the Twenty-fifth Series which is payable on any principal of the Bonds of the Twenty-fifth Series that is in excess of the principal of the Bonds of the Twenty-fifth Series as restricted pursuant to the preceding clauses (A) and (B).

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Exhibit C to
Twenty-fourth Supplemental Indenture

Form of Bond of the Twenty-sixth Series

Exhibit C

[FORM OF FIRST MORTGAGE BOND, COLLATERAL (2004) SERIES C, DUE 2014]

THIS BOND IS NOT TRANSFERABLE EXCEPT TO A SUCCESSOR TRUSTEE UNDER THE SENIOR NOTE INDENTURE (AS IDENTIFIED AND DEFINED BELOW).

NORTHWESTERN CORPORATION

First Mortgage Bond,
Collateral (2004) Series C, due 2014

No. R- $

NORTHWESTERN CORPORATION, a corporation organized and existing under the laws of the State of Delaware (the “Company”), for value received, hereby promises to pay to U.S. BANK, NATIONAL ASSOCIATION, AS TRUSTEE UNDER THE SENIOR NOTE INDENTURE to which reference is hereinafter made, or (subject to the transfer restrictions hereinbefore and hereinafter described) registered assigns, at the office or agency of the Company in the Borough of Manhattan, The City of New York, the sum of                dollars, on November 1, 2014 (the “Senior Note Maturity Date”), in such coin or currency of the United States of America as at the time of payment is legal tender for public and private debts, and to pay to the registered owner interest thereon as hereinafter described in like coin or currency and at such office or agency.

The bonds of the series of which this bond is one have been issued to U.S. Bank, National Association, as trustee (together with its successors in such capacity, the “Senior Note Trustee”) under the Indenture, dated as of November 1, 2004, between the Company and the Senior Note Trustee, as supplemented and amended by Supplemental Indenture No. 1, dated as of November 1, 2004 (as so supplemented and amended and as may be further supplemented, amended or otherwise modified in accordance with its terms, the “Senior Note Indenture”), to be owned and held by the Senior Note Trustee under the terms of the Senior Note Indenture as security for the payment of the principal of, premium (if any) and interest on a series of senior secured notes of the Company issued pursuant to the Senior Note Indenture designated “Senior Secured Notes, 5.875% Series A due 2014” (the “Series A Senior Notes”) and, if and to the extent issued and delivered in exchange for the Series A Senior Notes subject to and in accordance with the Senior Note Indenture, a series of senior secured notes of the Company designated “Senior Secured Notes, 5.875% Exchange Series A due 2014” (the “Series A Exchange Notes”).  The Series A Notes and, if and to the extent issued in exchange for Series A Senior Notes subject to and in accordance with the Senior Indenture, the Series A Exchange Notes are referred to hereinafter, collectively, as the “Senior Notes”.  For purposes of the Senior Note Indenture, Bonds of the Twenty-sixth Series, together with the South Dakota Senior Notes Bonds (as such term is hereinafter defined), are “the ‘related’ or ‘corresponding’ First Mortgage Bonds” with respect to the Senior Notes.

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The provisions of this bond are continued on the reverse hereof and such continued provisions shall for all purposes have the same effect as though set fully forth at this place.

This instrument shall not become obligatory until The Bank of New York (successor to Morgan Guaranty Trust Company of New York), the Corporate Trustee under the Mortgage (referred to on the reverse hereof), or its successors thereunder, shall have signed the form of authentication certificate endorsed hereon.

IN WITNESS WHEREOF, NORTHWESTERN CORPORATION has caused this instrument to be signed in its corporate name by its Chairman of the Board or its President or one of its Vice Presidents by his or her signature or a facsimile thereof, and its corporate seal to be impressed or imprinted hereon and attested by its Corporate Secretary or one of its Corporate Assistant Secretaries by his or her signature or a facsimile thereof.

Dated:

NORTHWESTERN CORPORATION
By:
	[Title]

Attest:

[Title]

(Seal)

CORPORATE TRUSTEE’S
AUTHENTICATION CERTIFICATE

This bond is one of the bonds, of the series herein designated, described or provided for in the within-mentioned Mortgage.

THE BANK OF NEW YORK,
as Corporate Trustee
By:
	Authorized Signatory

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[FORM OF REVERSE OF BOND]

General

This bond is one of an issue of bonds of the Company issuable in series and is one of a series known as its First Mortgage Bonds, Collateral (2004) Series C, due 2014 (sometimes herein referred to as the “Bonds of the Twenty-sixth Series”), all bonds of all series issued and to be issued under and equally secured (except in so far as any sinking or other fund, established in accordance with the provisions of the Mortgage hereinafter mentioned, may afford additional security for the bonds of any particular series) by a Mortgage and Deed of Trust (herein, together with any indenture supplemental thereto, including the Twenty-fourth Supplemental Indenture dated as of November 1, 2004 (the “Twenty-fourth Supplemental Indenture”), called the “Mortgage”), dated as of October 1, 1945, executed by The Montana Power Company (NorthWestern Corporation, successor thereunder) to Guaranty Trust Company of New York (The Bank of New York, successor thereunder) and Arthur E. Burke (MaryBeth Lewicki, successor thereunder), as Trustees.  Reference is made to the Mortgage for a description of the property mortgaged and pledged, the nature and extent of the security, the rights of the holders of the bonds and of the Trustees in respect thereof, the duties and immunities of the Trustees, the terms and conditions upon which the bonds are and are to be secured, the circumstances under which additional bonds may be issued and the definition of any capitalized term used herein but not defined herein. With the consent of the Company and to the extent permitted by and as provided in the Mortgage, the rights and obligations of the Company and/or the rights of the holders of the bonds and/or coupons and/or the terms and provisions of the Mortgage may be modified or altered by affirmative vote of the holders of at least 66-2/3% in principal amount of the bonds then Outstanding under the Mortgage and, if the rights of the holders of one or more, but less than all, series of bonds then Outstanding are to be affected, then also by affirmative vote of the holders of at least 66-2/3% in principal amount of the bonds then Outstanding of each series of bonds so to be affected (excluding in any case bonds disqualified from voting by reason of the Company’s interest therein as provided in the Mortgage); provided that, without the consent of the holder hereof, no such modification or alteration shall, among other things, impair or affect the right of the holder to receive payment of the principal of and interest on this bond, on or after the respective due dates expressed herein, or permit the creation of any lien equal or prior to the lien of the Mortgage or deprive the holder of the benefit of a lien on the mortgaged and pledged property.

The principal hereof may be declared or may become due prior to the maturity date hereinbefore named on the conditions, in the manner and at the time set forth in the Mortgage, upon the occurrence of a default as in the Mortgage provided.

No recourse shall be had for the payment of the principal of or interest on this bond against any incorporator or any past, present or future subscriber to the capital stock, stockholder, officer or director of the Company or of any predecessor or successor corporation, as such, either directly or through the Company or any predecessor or successor

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corporation, under any rule of law, statute or constitution or by the enforcement of any assessment or otherwise, all such liability of incorporators, subscribers, stockholders, officers and directors being released by the holder or owner hereof by the acceptance of this bond and being likewise waived and released by the terms of the Mortgage.

Transfer Provisions and Restrictions

Bonds of the Twenty-sixth Series shall not be transferable except to any successor Senior Note Trustee under the Senior Note Indenture.  As a condition precedent to any transfer of the Bonds of the Twenty-sixth Series by the Senior Note Trustee, the Senior Note Trustee shall submit to the Company, the Corporate Trustee and, if applicable, any bond registrar or transfer agent for the Bonds of the Twenty-sixth Series (in addition to all other documents and instruments required to be submitted pursuant to the Mortgage) a certificate of the Senior Note Trustee, signed by a person purporting to be its duly authorized officer, certifying that the transferee in such transfer is a successor Senior Note Trustee under the Senior Note Indenture (and the Corporate Trustee may conclusively presume the statements in any such certificate of the Senior Note Trustee to be correct and shall be fully protected in relying thereon).

Any such transfer is to be made as prescribed in the Mortgage by the registered owner hereof in person, or by his duly authorized attorney, at the office or agency of the Company in the Borough of Manhattan, The City of New York, upon surrender and cancellation of the applicable Bond of the Twenty-sixth Series, and, thereupon, a new fully registered temporary or definitive bond of the same series for a like principal amount will be issued to the transferee in exchange therefor as provided in the Mortgage.  The Company and the Trustees may deem and treat the person in whose name any Bond of the Twenty-sixth Series is registered as the absolute owner thereof for the purpose of receiving payment and for all other purposes and neither the Company nor the Trustees shall be affected by any notice to the contrary.

In the manner prescribed in the Mortgage, Bonds of the Twenty-sixth Series upon surrender thereof, for cancellation, at the office or agency of the Company in the Borough of Manhattan, The City of New York, are exchangeable for a like aggregate principal amount of registered bonds of the same series of other authorized denominations.

As provided in the Mortgage, the Company shall not be required to make transfers or exchanges of bonds of any series for a period of ten days next preceding any interest payment date for bonds of said series, or next preceding any designation of bonds of said series to be redeemed; provided, however, that pursuant to a waiver by the Company in the Twenty-fourth Supplemental Indenture, these restrictions shall not be applicable to any transfer of the Bonds of the Twenty-sixth Series to a successor Senior Note Trustee under the Senior Note Indenture.

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Principal

The unpaid principal of the Bonds of the Twenty-sixth Series, of which this bond is one, is scheduled to be paid on the Senior Notes Maturity Date.

Interest

The unpaid principal amount of the Bonds of the Twenty-sixth Series, of which this bond is one, bears interest at the rate of five and seven-eighths percent 5.875% per annum (calculated in the same manner as interest is calculated on the Senior Notes in accordance with the Senior Note Indenture), payable semiannually on the first (1st) day of each May and November, commencing on May 1, 2005 and continuing until the principal of the Bonds of the Twenty-sixth Series is paid (or provided for in accordance with the Senior Note Indenture), to the Senior Note Trustee as the registered owner, without regard to, or necessity for, any record date.

Senior Notes Applicable Share

As used herein, “Senior Notes Applicable Share” means, as of any day, a fraction (expressed as a percentage rounded to the eighth decimal place), (i) the numerator of which is the aggregate principal amount of the Bonds of the Twenty-sixth Series that are Outstanding on such day, and (ii) the denominator of which is the sum of (a) the aggregate principal amount of the Bonds of the Twenty-sixth Series that are Outstanding on such day, plus (b) the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series C, due 2014, of the Company (the “South Dakota Senior Notes Bonds”) that are outstanding on such day under the Company’s South Dakota Mortgage (as defined in the Twenty-fourth Supplemental Indenture).  Simultaneously with issuance and registration of the Bonds of the Twenty-sixth Series in the name of the Senior Note Trustee (for the same purpose), the South Dakota Senior Notes Bonds were issued to and registered in the name of the Senior Note Trustee, to be owned and held by the Senior Note Trustee under the terms of the Senior Note Indenture as security for the payment of the principal of, premium (if any) and interest on the Senior Notes.

Redemption

Bonds of the Twenty-sixth Series, of which this bond is one, shall be subject to redemption as follows (but shall not otherwise be or become subject to redemption, whether at the option of the holders thereof or the Company or pursuant to any other requirements or provisions of the Indenture):  (A) on each day on which Senior Notes become due and payable in accordance with Section 405 of the Senior Note Indenture by reason of redemption in accordance with the Senior Note Indenture (a “Senior Notes Redemption Payment Date”), Bonds of the Twenty-sixth Series shall be subject to mandatory redemption by the Company in an aggregate principal amount equal to the Senior Notes Applicable Share of the aggregate principal amount of the Senior Notes that become so due and payable on such Senior Notes Redemption Payment Date (a “Corresponding

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Redemption”); and (B) on each day on which the Senior Notes become due and payable in accordance with Section 702 of the Senior Note Indenture by reason of acceleration of the Senior Notes in accordance with the Senior Note Indenture (a “Senior Notes Acceleration Payment Date”), the entire aggregate principal amount of the Bonds of the Twenty-sixth Series shall be subject to mandatory redemption by the Company (an “Acceleration Redemption”); in each case, without any necessity for notice or call by the Company or by the Corporate Trustee (such notice and call being waived by the registered owners of the Bonds of the Twenty-sixth Series by the acceptance of the Bonds of the Twenty-sixth Series and in connection with each Redemption Demand hereinafter described); provided, however, that in the event of a rescission or annulment of the acceleration of the Senior Notes pursuant to the Senior Note Indenture, the related Acceleration Redemption shall be deemed to be rescinded or annulled (without prejudice to the occurrence of another Acceleration Redemption upon and by reason of a subsequent acceleration of the Senior Notes in accordance with the Senior Note Indenture).

Each Corresponding Redemption of Bonds of the Twenty-sixth Series on a Senior Notes Redemption Payment Date shall be at a redemption price equal to the redemption price payable in connection with the redemption of Senior Notes to which it corresponds (consisting of principal of and, if applicable to such redemption of Senior Notes in accordance with the Senior Note Indenture, premium on such Senior Notes), together with interest accrued on the principal included in such redemption price to such Senior Notes Redemption Payment Date (a “Corresponding Redemption Amount”); and such Corresponding Redemption Amount shall be due and payable on such Senior Notes Redemption Payment Date.  Each Acceleration Redemption of Bonds of the Twenty-sixth Series on a Senior Notes Acceleration Payment Date shall be at a redemption price equal to the principal amount of the Bonds of the Twenty-sixth Series (without premium), together with interest accrued on said principal to such Senior Notes Acceleration Payment Date (an “Acceleration Redemption Amount”); and such Acceleration Redemption Amount shall be due and payable on such Senior Notes Acceleration Payment Date.  In the event of any failure by the Company to pay when due the Corresponding Redemption Amount with respect to a Corresponding Redemption of Bonds of the Twenty-sixth Series or the Acceleration Redemption Amount with respect to an Acceleration Redemption of Bonds of the Twenty-sixth Series, interest shall accrue on such unpaid Corresponding Redemption Amount or such unpaid Acceleration Redemption Amount at the rates (and in amounts equal to the Senior Notes Applicable Share of the amounts) of interest that accrue on the corresponding unpaid principal of, premium (if any) and interest on the Senior Notes in accordance with the Senior Note Indenture.

The Corporate Trustee may conclusively presume that no redemption of Bonds of the Twenty-sixth Series is required unless and until it shall have received a written notice from the Senior Note Trustee, signed by a person purporting to be its duly authorized officer, stating that Senior Notes became due and payable pursuant to Section 405 or 702 of the Senior Note Indenture by reason of redemption or acceleration in accordance with the Senior Note Indenture (a “Redemption Demand”).  Each Redemption Demand also shall

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state (i) the date on which Senior Notes became due and payable by reason of redemption or acceleration in accordance with the Senior Note Indenture, (ii) the principal amount of the Senior Notes that became so due and payable on such date, (iii) the principal amount of Bonds of the Twenty-sixth Series to be redeemed on such date in accordance with this Twenty-fourth Supplemental Indenture by reason of such redemption or acceleration, and (iv) the Corresponding Redemption Amount or the Acceleration Redemption Amount payable on such date with respect to Bonds of the Twenty-sixth Series (determined in accordance with the Twenty-fourth Supplemental Indenture) and setting forth the amounts of the respective portions thereof representing principal of, premium (if any) and interest on the Bonds of the Twenty-sixth Series.  Each Redemption Demand shall be deemed to constitute a waiver by the Senior Note Trustee, as registered owner of all Bonds of the Twenty-sixth Series then Outstanding, of notice of redemption and call for redemption by the Company or the Corporate Trustee of the Bonds of the Twenty-sixth Series subject to redemption as described in such Redemption Demand.  The Corporate Trustee may conclusively presume the statements contained in each Redemption Demand to be correct (and the Corporate Trustee shall be fully protected in relying thereon).

The Corporate Trustee may conclusively presume that no rescission or annulment of an Acceleration Redemption (in respect of which the Corporate Trustee has received a Redemption Demand) is required unless and until it shall have received a written notice from the Senior Note Trustee, signed by a person purporting to be its duly authorized officer, stating that the acceleration of the Senior Notes has been rescinded or annulled in accordance with the Senior Note Indenture (a “Rescission Notice”).  Each Rescission Notice also shall state the date on which the acceleration of the Senior Notes was rescinded or annulled in accordance with the Senior Note Indenture and, as consequence, the acceleration of the Bonds of the Twenty-sixth Series was rescinded or annulled in accordance with the Twenty-fourth Supplemental Indenture.  The Corporate Trustee may conclusively presume the statements contained in any Rescission Notice to be correct (and the Corporate Trustee shall be fully protected in relying thereon).

Additional Terms

Bonds of the Twenty-sixth Series, of which this bond is one, shall be subject to the following other terms and conditions:

(I)            It is expressly stated (for the avoidance of any doubt) that, notwithstanding anything in this bond or the Twenty-fourth Supplemental Indenture to the contrary (other than the provisions of subdivision (III) below), each payment of principal of, premium (if any) or interest on the Bonds of the Twenty-sixth Series that becomes due and payable on any day (whether by reason of stated due date, acceleration, redemption or otherwise) shall correspond to, and be equal to the Senior Notes Applicable Share of, a payment of principal of, premium (if any) or interest on the Senior Notes that becomes due and payable on such day in accordance with the Senior Note Indenture.

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(II)           The obligation of the Company to make each payment of principal of, premium (if any) or interest on the Bonds of the Twenty-sixth Series that becomes due and payable in accordance with the Twenty-fourth Supplemental Indenture (A) shall be fully satisfied and discharged if the corresponding payment of the principal of, premium (if any) or interest on the Senior Notes shall have been fully paid, or if provision for the full payment thereof shall been made (by depositing moneys sufficient for such full payment with the Senior Note Trustee), in either case under and in accordance with the Senior Note Indenture, and (B) shall be partially satisfied and discharged if the corresponding payment of the principal of, premium (if any) or interest on the Senior Notes shall have been partially paid, or if provision for the partial payment thereof shall have been made (by depositing moneys sufficient for such partial payment with the Senior Note Trustee), in either case, under and in accordance with the Senior Note Indenture (such partial satisfaction and discharge with respect to the Bonds of the Twenty-sixth Series to be in an amount equal to the Senior Notes Applicable Share of the amount of such partial payment or provision for partial payment with respect to the Senior Notes).

(III)         Nothing in any of the Bonds of the Twenty-sixth Series (including, without limitation, any reference to the principal payable with respect to the Bonds of the Twenty-sixth Series being determined on the basis of the Senior Notes Applicable Share of the principal payable with respect to the Senior Notes) shall, or shall be deemed or construed to, (A) increase the aggregate principal amount of the Bonds of the Twenty-sixth Series that are Outstanding from time to time, (B) cause or permit an amount of principal of the Bonds of the Twenty-sixth Series to be or to become due and payable which, when added to all other principal of such Bonds theretofore paid, exceeds $161,000,000, or (C) cause or permit to be or to become due and payable interest on the Bonds of the Twenty-sixth Series which is payable on any principal of the Bonds of the Twenty-sixth Series that is in excess of the principal of the Bonds of the Twenty-sixth Series as restricted pursuant to the preceding clauses (A) and (B).

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EX-4.5

Exhibit 4.5

NORTHWESTERN CORPORATION

TO

JPMORGAN CHASE BANK

as Trustee

SUPPLEMENTAL INDENTURE

Providing, among other things, for

First Mortgage Bonds, Collateral (2004) Series A, due 2009
First Mortgage Bonds, Collateral (2004) Series B, due 2011
and
First Mortgage Bonds, Collateral (2004) Series C, due 2014

Dated as of November 1, 2004

SUPPLEMENTAL INDENTURE, dated as of November 1, 2004 (this “Supplemental Indenture”), made by and between NORTHWESTERN CORPORATION (formerly known as Northwestern Public Service Company), a corporation organized and existing under the laws of the State of Delaware (the “Company”), the post office address of which is 125 S. Dakota Avenue, Suite 1100, Sioux Falls, South Dakota 57104, and JPMORGAN CHASE BANK (successor by merger to The Chase Manhattan Bank (National Association)), a bank organized and existing under the laws of the State of New York (the “Trustee”), as Trustee under the General Mortgage Indenture and Deed of Trust dated as of August 1, 1993, hereinafter mentioned, the post office address of which is 4 New York Plaza, 15^th Floor, New York, New York 10004;

WHEREAS, the Company has heretofore executed and delivered its General Mortgage Indenture and Deed of Trust dated as of August 1, 1993 (the “Original Indenture”), to the Trustee, for the security of the Bonds of the Company issued and to be issued thereunder (the “Bonds”); and

WHEREAS, the Company has heretofore executed and delivered to the Trustee six indentures supplemental to the Original Indenture, the first dated as of August 15, 1993, the second dated as of August 1, 1995, each of the third, fourth and fifth dated as of September 1, 1995, and the sixth dated as of February 1, 2003 (the Original Indenture, as supplemented and amended by the aforementioned six supplemental indentures and by this Supplemental Indenture, being hereinafter referred to as the “Indenture”); and

WHEREAS, the Company desires to create three new series of Bonds to be issued under the Indenture, to be known respectively as First Mortgage Bonds, Collateral (2004) Series A, due 2009 (the “First Mortgage Bonds, Collateral (2004) Series A”), First Mortgage Bonds, Collateral (2004) Series B, due 2011 (the “First Mortgage Bonds, Collateral (2004) Series B”) and First Mortgage Bonds, Collateral (2004) Series C, due 2014 (the “First Mortgage Bonds, Collateral (2004) Series C”); and

WHEREAS, the Company, in the exercise of the powers and authority conferred upon and reserved to it under the provisions of the Indenture, and pursuant to appropriate resolutions of the Board of Directors, has duly resolved and determined to make, execute and deliver to the Trustee a Supplemental Indenture in the form hereof for the purposes herein provided; and

WHEREAS, all conditions and requirements necessary to make this Supplemental Indenture a valid, binding and legal instrument have been done, performed and fulfilled and the execution and delivery hereof have been in all respects duly authorized;

NOW, THEREFORE, THIS INDENTURE WITNESSETH:

THAT NorthWestern Corporation, in consideration of the acceptance or the purchase and ownership (as applicable) from time to time of the Bonds and the service by the Trustee and its successors, under the Indenture and of One Dollar to it, duly paid by the Trustee at or before the ensealing and delivery of these presents, the receipt whereof is hereby acknowledged, hereby covenants and agrees to and with the Trustee and its

successors in the trust under the Indenture, for the benefit of those who shall hold the Bonds as follows:

ARTICLE I
DESCRIPTION OF FIRST MORTGAGE BONDS, COLLATERAL (2004)
SERIES A

SECTION 1.  The Company hereby creates a new series of Bonds to be known as “First Mortgage Bonds, Collateral (2004) Series A, due 2009”.  The First Mortgage Bonds, Collateral (2004) Series A shall be executed, authenticated and delivered in accordance with the provisions of, and shall in all respects be subject to, all of the terms, conditions and covenants of the Indenture, as supplemented and modified.  The aggregate principal amount of First Mortgage Bonds, Collateral (2004) Series A which may be authenticated and delivered under the Indenture (except for First Mortgage Bonds, Collateral (2004) Series A authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of, other First Mortgage Bonds, Collateral (2004) Series A pursuant to the Indenture and except for First Mortgage Bonds, Collateral (2004) Series A which, pursuant to the Indenture, are deemed never to have been authenticated and delivered under the Indenture) is limited to $35,000,000.

First Mortgage Bonds, Collateral (2004) Series A shall be issued to Lehman Commercial Paper Inc., as collateral agent (together with its successors in such capacity, the “Collateral Agent”) under the Bond Delivery and Collateral Agreement, dated as of November 1, 2004 (as amended or otherwise modified, or as waived, or as replaced, in each case, from time to time in accordance with its terms, the “Collateral Agreement”), between the Company and the Collateral Agent, to secure the obligations of the Company to pay when due the Revolving Credit Applicable Share (as hereinafter defined) of the Revolving Credit Obligations (as hereinafter defined) under the Credit Agreement, dated as of November 1, 2004 (as amended or otherwise modified, or as waived, or as replaced, in each case, from time to time in accordance with its terms, the “Credit Agreement”), among the Company, as borrower, the several lenders from time to time parties thereto (the “Lenders”), Lehman Brothers Inc. and Deutsche Bank Securities Inc., as joint lead arrangers and joint bookrunners, Deutsche Bank Securities Inc., as syndication agent, Union Bank of California, N.A. and KeyBank National Association, as co-documentation agents, Lehman Commercial Paper Inc., as administrative agent (together with its successors in such capacity, the “Administrative Agent”) and the Collateral Agent.

As used herein, “Revolving Credit Obligations” means the obligations of the Company (A) to pay (i) principal of and interest on (a) the Revolving Credit Loans (as defined in the Credit Agreement), (b) the Swing Line Loans (as defined in the Credit Agreement), and (c) drawings under Letters of Credit that are not reimbursed pursuant to and in accordance with the Credit Agreement (collectively, “Revolving Loans”), (ii) commitment fees on the average daily amount of the unused Total Revolving Credit Commitments (as defined in the Credit Agreement); and (iii) letter of credit fees on the amount available to be drawn under Letters of Credit (as defined in the Credit

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Agreement), and (B) to cash collateralize Letters of Credit pursuant to and in accordance with Section 8 of the Credit Agreement.

As used herein, “Revolving Credit Applicable Share” means, as of any day, a fraction (expressed as a percentage rounded to the second decimal place), (i) the numerator of which is the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series A that are Outstanding on such day, and (ii) the denominator of which is the sum of (a) the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series A that are Outstanding on such day, plus (b) the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series A, due 2009, of the Company (the “Montana Revolving Credit Bonds”) that are outstanding on such day under the Company’s Mortgage and Deed of Trust, dated as of October 1, 1945, relating (among other things) to property acquired by the Company from NorthWestern Energy, L.L.C., which in turn acquired such property from The Montana Power Company (as amended and supplemented, the “Montana Mortgage”).  Simultaneously with the issuance and registration of the First Mortgage Bonds, Collateral (2004) Series A in the name of the Collateral Agent (for the same purpose), the Montana Revolving Credit Bonds will be issued to the Collateral Agent to secure the Revolving Credit Obligations under the Credit Agreement.  Initially, the Revolving Credit Applicable Share will be 28.00% (being the expression as a percentage (rounded to the second decimal place) of a fraction, the numerator of which is $35,000,000 (the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series A that are to be issued and become Outstanding) and the denominator of which is $125,000,000 (the sum of $35,000,000, the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series A that are to be issued and become Outstanding, plus $90,000,000, the aggregate principal amount of the Montana Revolving Credit Bonds that are to be issued and become outstanding under the Montana Mortgage simultaneously with the issuance of the First Mortgage Bonds, Collateral (2004) Series A).  Pursuant to the Collateral Agreement, the Collateral Agent has agreed to furnish to the Trustee (with a copy to the Company) as soon as practicable after any change in the Revolving Credit Applicable Share, a certificate, signed by a person purporting to be its duly authorized officer, notifying the Trustee of such change in the Revolving Credit Applicable Share (a “Revolving Credit Applicable Share Certificate”).  Each Revolving Credit Applicable Share Certificate shall set forth (i) the changed Revolving Credit Applicable Share, (ii) the date such change occurred, (iii) the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series A then Outstanding, and (iv) the aggregate principal amount of the Montana Revolving Credit Bonds then outstanding under the Montana Mortgage.  The Trustee may conclusively presume that the Revolving Credit Applicable Share is 28.00% unless and until the Trustee receives a Revolving Credit Applicable Share Certificate.  Following receipt by the Trustee of a Revolving Credit Applicable Share Certificate, the Trustee may conclusively presume that the Revolving Credit Applicable Share is as set forth in such Revolving Credit Applicable Share Certificate unless and until the Trustee receives a subsequent Revolving Credit Applicable Share Certificate (and the Trustee shall be fully protected in relying thereon).

First Mortgage Bonds, Collateral (2004) Series A shall mature on November 1, 2009 (the “Revolving Credit Maturity Date”), with the unpaid principal of the First

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Mortgage Bonds, Collateral (2004) Series A to be payable on the Revolving Credit Maturity Date; the unpaid principal amount of the First Mortgage Bonds, Collateral (2004) Series A shall bear interest (i) with respect to the portion or amount of such principal that is equal to the principal amount of Revolving Loans, at one or more variable interest rates per annum which rate or rates for each day shall be equal to the rate or rates per annum borne by Revolving Loans in accordance with the Credit Agreement for such day (calculated in the manner provided in the Credit Agreement for the calculation of interest on Revolving Loans), payable on each day on which interest is payable on Revolving Loans in accordance with the Credit Agreement (and in an amount equal to the Revolving Credit Applicable Share of the amount of interest that is payable on Revolving Loans on such day in accordance with the Credit Agreement), (ii) with respect to the portion or amount of such principal (in excess of the amount described in the preceding clause (i)) that is equal to the Revolving Credit Applicable Share of the unused Total Revolving Credit Commitments (as defined in the Credit Agreement), at one or more variable interest rates per annum which rate or rates for any day shall be equal to the rate or rates per annum at which commitment fees are payable under the Credit Agreement on the unused Total Revolving Credit Commitments, payable on each day on which commitment fees are payable under the Credit Agreement (and in an amount equal to the Revolving Credit Applicable Share of the amount of commitment fees that is payable under the Credit Agreement on such day), and (iii) with respect to the portion or amount of such principal (in excess of the amounts described in the preceding clauses (i) and (ii)) that is equal to the Revolving Credit Applicable Share of the amount available to be drawn under Letters of Credit (as defined in the Credit Agreement), at one or more variable interest rates per annum which rate or rates for each day shall be equal to the rate or rates per annum at which letter of credit fees are payable under the Credit Agreement on the amount available to be drawn under Letters of Credit, payable on each day on which letter of credit fees are payable under the Credit Agreement (and in an amount equal to the Revolving Credit Applicable Share of the amount of letter of credit fees that is payable under the Credit Agreement on such day), in each case, to the Collateral Agent, as the registered owner, without regard to, or necessity for, any record date; the principal of and interest on each said Bond to be payable at the office or agency of the Company in the Borough of Manhattan, The City of New York, in such coin or currency of the United States of America as at the time of payment is legal tender for public and private debts.  First Mortgage Bonds, Collateral (2004) Series A shall be dated as provided in Section 3.03(c) of the Original Indenture (as supplemented).

SECTION 2.  First Mortgage Bonds, Collateral (2004) Series A shall be issued only as registered Bonds without coupons of the denomination of $1,000, or any integral multiple of $1 in excess of $1,000, appropriately numbered.  First Mortgage Bonds, Collateral (2004) Series A may be exchanged, upon surrender thereof, at the office or agency of the Company in the Borough of Manhattan, The City of New York, State of New York, for one or more First Mortgage Bonds, Collateral (2004) Series A of other authorized denominations, for the same aggregate principal amount, subject to the terms and conditions set forth in the Indenture.

First Mortgage Bonds, Collateral (2004) Series A shall not be transferable except to any successor Collateral Agent under the Collateral Agreement.  As a condition

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precedent to any transfer of the First Mortgage Bonds, Collateral (2004) Series A by the Collateral Agent, the Collateral Agent shall submit to the Company, the Trustee and the Bond Registrar (in addition to all other documents and instruments required to be submitted to the Bond Registrar pursuant to the Indenture) a certificate of the Collateral Agent, signed by a person purporting to be its duly authorized officer, certifying that the transferee in such transfer is a successor Collateral Agent under the Collateral Agreement (and the Trustee and the Bond Registrar may conclusively presume the statements in any such certificate of the Collateral Agent to be correct).

Any transfer of First Mortgage Bonds, Collateral (2004) Series A (i) shall be subject to the provisions of Section 3.05 of the Indenture, except that the provisions of paragraph (g) of such Section 3.05 shall not be applicable to any transfer of First Mortgage Bonds, Collateral (2004) Series A to a successor Collateral Agent under the Collateral Agreement, and (ii) shall be made at the office or agency of the Company in the Borough of Manhattan, The City of New York.

The Company hereby waives any right to make any charge for any exchange or transfer of First Mortgage Bonds, Collateral (2004) Series A by the Collateral Agent, whether to reimburse itself for any tax or taxes or other governmental charge or otherwise (it being understood that the Company shall pay any tax or taxes or governmental or other charge which may be payable by reason of any exchange or transfer of First Mortgage Bonds, Collateral (2004) Series A by the Collateral Agent).

The Company has appointed JPMorgan Chase Bank as its agent to receive First Mortgage Bonds, Collateral (2004) Series A presented or surrendered for payment, to receive First Mortgage Bonds, Collateral (2004) Series A surrendered for registration of transfer or exchange and to receive notices and demands to or upon the Company in respect of the First Mortgage Bonds, Collateral (2004) Series A and the Indenture; and the corporate trust office of JPMorgan Chase Bank in the Borough of Manhattan, The City of New York, State of New York shall be the office or agency of the Company in the Borough of Manhattan, The City of New York, State of New York at which such presentations, surrenders, notices and demands may be made or served.

SECTION 3.  First Mortgage Bonds, Collateral (2004) Series A shall be subject to the following terms and conditions (including, without limitation, redemption terms and conditions):

(I)            From time to time after the issuance of the First Mortgage Bonds, Collateral (2004) Series A, and as Revolving Loans are prepaid and reborrowed subject to and in accordance with the Credit Agreement, (A) for purposes of determining the amount of principal payable by the Company with respect to the First Mortgage Bonds, Collateral (2004) Series A, the unpaid principal amount of the First Mortgage Bonds, Collateral (2004) Series A at any time shall be deemed to be equal to the Revolving Credit Applicable Share of the unpaid principal amount of the Revolving Loans at such time, plus, if an acceleration of the Revolving Loans shall be in effect in accordance with the Credit Agreement at such time, the amount of cash collateral required to be provided by the Company pursuant to Section 8 of the Credit Agreement in respect of Letters of

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Credit, and (B) for all other purposes of the Indenture (including, without limitation, the determination of the amount of principal on which interest is payable and the determination of the principal amount with respect to which the Collateral Agent, as registered owner, is entitled to vote or otherwise exercise rights as registered owner), the First Mortgage Bonds, Collateral (2004) Series A shall be deemed to be “Outstanding” at any time in an aggregate principal amount equal to the Maximum Principal Amount at such time.  Pursuant to (and by reason of the provisions of Section 10.2 of) the Credit Agreement, the Administrative Agent has agreed to submit to the Trustee (with copies to the Collateral Agent and the Company), from time to time promptly after the request of the Trustee or the Company, a written statement, signed by a person purporting to be its duly authorized officer (an “Unpaid Principal Amount Statement”) stating the unpaid principal amount of the Revolving Loans (and, as a consequence, of the principal amount of the First Mortgage Bonds, Collateral (2004) Series A payable by the Company) as of the date of such Unpaid Principal Amount Statement, setting forth the portions or amounts of the Revolving Loans that are Revolving Credit Loans, Swing Line Loans and unreimbursed drawings under Letters of Credit.  The Trustee may conclusively presume the statements contained in each Unpaid Principal Amount Statement to be correct (and the Trustee shall be fully protected in relying thereon).

(II)           The Maximum Principal Amount on and as of the date of original issuance of the First Mortgage Bonds, Collateral (2004) Series A shall be $35,000,000 (which amount shall be equal to the Revolving Credit Applicable Share of the Total Revolving Credit Commitments on and as of such date) and thereafter shall be reduced from time to time upon each Revolving Credit Commitment Redemption (as hereinafter defined in subdivision III below) and each Revolving Credit Event of Default Commitment Termination Redemption (as hereinafter defined in subdivision III below), in each case, by an amount equal to the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series A that are deemed to have been redeemed pursuant to such Revolving Credit Commitment Redemption or such Revolving Credit Event of Default Commitment Termination Redemption.

(III)         First Mortgage Bonds, Collateral (2004) Series A shall be subject to redemption as follows (but shall not otherwise be or become subject to redemption, whether at the option of the holders thereof or the Company or pursuant to any other requirements or provisions of the Indenture):  (A) on each day on which there is a permanent reduction or termination of the Revolving Credit Commitments (as defined in the Credit Agreement) pursuant to Section 2.10 of the Credit Agreement, First Mortgage Bonds, Collateral (2004) Series A shall be deemed to have been redeemed in an aggregate principal amount equal to the Revolving Credit Applicable Share of the amount of such permanent reduction or termination of the Revolving Credit Commitments pursuant to such Section 2.10 (a “Revolving Credit Commitment Redemption”); (B) on each day on which the Revolving Credit Commitments are permanently terminated pursuant to Section 8 of the Credit Agreement, First Mortgage Bonds, Collateral (2004) Series A shall be deemed to have been redeemed in an aggregate principal amount which, after giving effect to such termination, results in the Maximum Principal Amount of the First Mortgage Bonds, Collateral (2004) Series A being equal to the Revolving Credit Applicable Share of the sum of the principal amount of the Revolving Loans then

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outstanding under the Credit Agreement and the amount then available to be drawn under Letters of Credit (a “Revolving Credit Event of Default Commitment Termination Redemption”); and (C) on each day on which the Revolving Loans are accelerated in accordance with the Credit Agreement (an “Acceleration Redemption Date”), the entire aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series A shall be subject to mandatory redemption by the Company (an “Acceleration Redemption”); in each case, without any necessity for notice or call by the Company or by the Trustee (such notice and call being waived by the registered owners of the First Mortgage Bonds, Collateral (2004) Series A by the acceptance of the First Mortgage Bonds, Collateral (2004) Series A and in connection with each Redemption Demand hereinafter described); provided, however, that in the event of a reinstatement of the Revolving Credit Commitments or a rescission or annulment of the acceleration of the Revolving Loans pursuant to the Credit Agreement or otherwise, the related Revolving Credit Event of Default Commitment Termination Redemption or the related Acceleration Redemption shall be deemed to be rescinded or annulled, without prejudice to the occurrence of another Revolving Credit Event of Default Commitment Termination Redemption or another Acceleration Redemption upon and by reason of a subsequent termination of the Revolving Credit Commitments pursuant to Section 8 of the Credit Agreement or another acceleration of the Revolving Loans in accordance with the Credit Agreement.  Acceleration Redemption of the First Mortgage Bonds, Collateral (2004) Series A on an Acceleration Redemption Date shall be at a redemption price equal to the principal amount (determined in accordance with the provisions of subdivision II above) of the First Mortgage Bonds, Collateral (2004) Series A that is then payable by the Company (without premium), together with interest accrued on said principal to and including such Acceleration Redemption Date (collectively, an “Acceleration Redemption Amount”); and such Acceleration Redemption Amount shall be due and payable on such Acceleration Redemption Date.  In the event of any failure by the Company to pay when due an Acceleration Redemption Amount, interest shall accrue on such unpaid Acceleration Redemption Amount at the rates (and in amounts equal to the Revolving Credit Applicable Share of the amounts) of interest that accrue on the corresponding unpaid principal of and interest on the Revolving Loans in accordance with the Credit Agreement.

The Trustee may conclusively presume that no redemption of First Mortgage Bonds, Collateral (2004) Series A is deemed to have occurred or resulted in a reduction of the Maximum Principal Amount (in the case of a Revolving Credit Commitment Redemption or a Revolving Credit Event of Default Commitment Termination Redemption) or is required to occur (in the case of an Acceleration Redemption) unless and until it shall have received a written notice from the Administrative Agent, signed by a person purporting to be its duly authorized officer, stating that the Revolving Credit Commitments have been permanently reduced or terminated pursuant to Section 2.10 of the Credit Agreement or the Revolving Credit Commitments have been permanently terminated pursuant to Section 8 of the Credit Agreement or the Revolving Loans have been accelerated in accordance with the Credit Agreement (a “Redemption Demand”).  Each Redemption Demand also shall (i) state the date on which the Revolving Credit Commitments were permanently reduced or terminated pursuant to Section 2.10 of the Credit Agreement or the Revolving Credit Commitments were permanently terminated

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pursuant to Section 8 of the Credit Agreement or the Revolving Loans were accelerated, (ii) the amount by which the Revolving Credit Commitments were so permanently reduced or terminated and the Maximum Principal Amount (determined in accordance with this Supplemental Indenture) after giving effect to the related and deemed redemption of First Mortgage Bonds, Collateral (2004) Series A or the principal amount of the Revolving Loans subject to acceleration on such date, (iii) the principal amount of First Mortgage Bonds, Collateral (2004) Series A that are deemed to have been redeemed or are to be redeemed on such date in accordance with this Supplemental Indenture by reason of such permanent reduction or termination of the Revolving Credit Commitments and such reduction of the Maximum Principal Amount or such acceleration of the Revolving Loans, and (iv) in the case of an Acceleration Redemption, the Acceleration Redemption Amount payable with respect to the First Mortgage Bonds, Collateral (2004) Series A (determined in accordance with this Supplemental Indenture) and setting forth the amounts of the respective portions thereof representing principal of and interest on the First Mortgage Bonds, Collateral (2004) Series A.  Each Redemption Demand shall be deemed to constitute a written waiver by the Collateral Agent, as registered owner of all First Mortgage Bonds, Collateral (2004) Series A then Outstanding, of notice of redemption and call for redemption by the Company or the Trustee of the First Mortgage Bonds, Collateral (2004) Series A subject to redemption as described in such Redemption Demand.  The Trustee may conclusively presume the statements contained in each Redemption Demand to be correct (and the Trustee shall be fully protected in relying thereon).

The Trustee may conclusively presume that no rescission or annulment of a Revolving Credit Event of Default Commitment Termination Redemption or an Acceleration Redemption (in respect of which the Trustee has received a Redemption Demand) is required unless and until it shall have received a written notice from the Administrative Agent, signed by a person purporting to be its duly authorized officer, stating that the termination of the Revolving Credit Commitments pursuant to Section 8 of the Credit Agreement or the acceleration of the Revolving Loans has been rescinded or annulled in accordance with the Credit Agreement or otherwise (a “Rescission Notice”).  Each Rescission Notice also shall state the date on which the termination of the Revolving Credit Commitments pursuant to Section 8 of the Credit Agreement or the acceleration of the Revolving Loans was rescinded or annulled in accordance with the Credit Agreement or otherwise and, as consequence, the redemption of the First Mortgage Bonds, Collateral (2004) Series A was rescinded or annulled in accordance with this Supplemental Indenture.  The Trustee may conclusively presume the statements contained in any Rescission Notice to be correct (and the Trustee shall be fully protected in relying thereon).

Pursuant to (and by reason of the provisions of Section 10.2 of) the Credit Agreement, the Administrative Agent has agreed to submit to the Trustee (with copies to the Collateral Agent and the Company) (i) a Redemption Demand with respect to, and in connection with, each event that gives rise to a redemption (deemed or actual) of First Mortgage Bonds, Collateral (2004) Series A, and (ii) a Rescission Notice in connection with any event that gives rise to the rescission or annulment of a Revolving Credit Event of Default Commitment Termination Redemption or an Acceleration Redemption. 

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Pursuant to the Collateral Agreement, the Collateral Agent has agreed, upon written request of the Company and so long as no Default or Event of Default described in Section 8(f) of the Credit Agreement shall have occurred and be continuing, to surrender or exchange its First Mortgage Bond, Collateral (2004) Series A or First Mortgage Bonds, Collateral (2004) Series A, from time to time (including, without limitation, promptly following each redemption of First Mortgage Bonds, Collateral (2004) Series A that is deemed to occur (in the case of a Revolving Credit Commitment Redemption or a Revolving Credit Event of Default Commitment Termination Redemption) or that occurs (in the case of an Acceleration Redemption) in accordance with this Supplemental Indenture), so that at all times the Collateral Agent is holding one or more First Mortgage Bonds, Collateral (2004) Series A in an aggregate principal amount equal to, but not in excess of, the Maximum Principal Amount of the First Mortgage Bonds, Collateral (2004) Series A at such time.

(IV)         It is expressly stated (for the avoidance of any doubt) that, notwithstanding anything herein or in any First Mortgage Bonds, Collateral (2004) Series A to the contrary (other than the provisions of subdivision VI below), each payment of principal of or interest on the First Mortgage Bonds, Collateral (2004) Series A that becomes due and payable on any day in accordance with this Supplemental Indenture (whether by reason of stated due date, acceleration, redemption or otherwise) shall correspond to, and be equal to the Revolving Credit Applicable Share of, a payment of Revolving Credit Obligations that becomes due and payable on such day in accordance with the Credit Agreement.

(V)           The obligation of the Company to make each payment of principal of or interest on the First Mortgage Bonds, Collateral (2004) Series A that becomes due and payable in accordance with this Supplemental Indenture (A) shall be fully satisfied and discharged if the corresponding payment of the Revolving Credit Obligations shall have been fully paid under and in accordance with the Credit Agreement, and (B) shall be partially satisfied and discharged if the corresponding payment of the Revolving Credit Obligations shall have been partially paid under and in accordance with the Credit Agreement (such partial satisfaction and discharge with respect to the First Mortgage Bonds, Collateral (2004) Series A to be in an amount equal to the Revolving Credit Applicable Share of the amount of such partial payment with respect to the Revolving Credit Obligations).  The Trustee may conclusively presume that the obligation of the Company to make payments with respect to the principal of and interest on the First Mortgage Bonds, Collateral (2004) Series A has been fully satisfied and discharged unless and until the Trustee shall have received a written notice from the Administrative Agent, signed by a person purporting to be its duly authorized officer, stating (i) that the Company has failed to make timely payment in full or in part of an amount of Revolving Credit Obligations which became due and payable in accordance with the Credit Agreement, (ii) the amount and date of such payment of Revolving Credit Obligations which the Company has failed to make in accordance with the Credit Agreement, and (iii) the amount of principal of and/or interest on the First Mortgage Bonds, Collateral (2004) Series A which, in accordance with this Supplemental Indenture, has not been satisfied and discharged by reason of such failure of the Company.  The Trustee may conclusively presume the statements contained in any such notice from the

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Administrative Agent to be correct unless and until the Trustee shall receive a subsequent and/or modified notice from the Administrative Agent pursuant to and in accordance with this subdivision (V) (and the Trustee shall be fully protected in relying thereon).  Without limitation of the foregoing, and for the avoidance of any doubt, it is expressly stated that the Trustee shall not be responsible for (i) the calculation of interest on the First Mortgage Bonds, Collateral (2004) Series A, or (ii) the determination of any amount (including, without limitation, any amount of the Revolving Credit Obligations) that is payable or paid under the Credit Agreement.

(VI)         Nothing herein or in any of the First Mortgage Bonds, Collateral (2004) Series A (including, without limitation, any reference to the principal payable with respect to the First Mortgage Bonds, Collateral (2004) Series A being determined on the basis of the Revolving Credit Applicable Share of the principal payable with respect to the Revolving Credit Obligations) shall, or shall be deemed or construed to, increase the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series A that are Outstanding at any time to an amount in excess of the Maximum Principal Amount at such time.

SECTION 4.  The First Mortgage Bonds, Collateral (2004) Series A and the Trustee’s Certificate of Authentication shall be substantially in the form attached hereto as Exhibit A.

ARTICLE II
DESCRIPTION OF FIRST MORTGAGE BONDS, COLLATERAL (2004)
SERIES B

SECTION 1.  The Company hereby creates a new series of Bonds to be known as “First Mortgage Bonds, Collateral (2004) Series B, due 2011.”  The First Mortgage Bonds, Collateral (2004) Series B shall be executed, authenticated and delivered in accordance with the provisions of, and shall in all respects be subject to, all of the terms, conditions and covenants of the Indenture, as supplemented and modified.  The aggregate principal amount of First Mortgage Bonds, Collateral (2004) Series B which may be authenticated and delivered under the Indenture (except for First Mortgage Bonds, Collateral (2004) Series B authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of, other First Mortgage Bonds, Collateral (2004) Series B pursuant to the Indenture and except for First Mortgage Bonds, Collateral (2004) Series B which, pursuant to the Indenture, are deemed never to have been authenticated and delivered under the Indenture) is limited to $28,000,000.

First Mortgage Bonds, Collateral (2004) Series B shall be issued to the Collateral Agent to secure the obligations of the Company to pay when due the Term Loan Applicable Share (as hereinafter defined) of the principal of and interest on the term loans (the “Term Loans”) made and outstanding under the Credit Agreement.

As used herein, “Term Loan Applicable Share” means, as of any day, a fraction (expressed as a percentage rounded to the second decimal place), (i) the numerator of which is the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series B that are Outstanding on such day, and (ii) the denominator of which is the sum of (a) the aggregate principal amount of the First Mortgage Bonds, Collateral (2004)

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Series B that are Outstanding on such day, plus (b) the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series B, due 2011, of the Company (the “Montana Term Loan Bonds”) that are outstanding on such day under the Montana Mortgage.  Simultaneously with the issuance and registration of the First Mortgage Bonds, Collateral (2004) Series B in the name of the Collateral Agent (for the same purpose), the Montana Term Loan Bonds will be issued to the Collateral Agent to secure the obligations of the Company to pay when due a portion of the principal of and interest on the Term Loans.  Initially, the Term Loan Applicable Share will be 28.00% (being the expression as a percentage (rounded to the second decimal place) of a fraction, the numerator of which is $28,000,000 (the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series B that are to be issued and become Outstanding) and the denominator of which is $100,000,000 (the sum of $28,000,000, the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series B that are to be issued and become Outstanding, plus $72,000,000, the aggregate principal amount of the Montana Term Loan Bonds that are to be issued and become outstanding under the Montana Mortgage simultaneously with the issuance of the First Mortgage Bonds, Collateral (2004) Series B).  Pursuant to the Collateral Agreement, the Collateral Agent has agreed to furnish to the Trustee (with a copy to the Company) as soon as practicable after any change in the Term Loan Applicable Share, a certificate, signed by a person purporting to be its duly authorized officer, notifying the Trustee of such change in the Term Loan Applicable Share (a “Term Loan Applicable Share Certificate”).  Each Term Loan Applicable Share Certificate shall set forth (i) the changed Term Loan Applicable Share, (ii) the date such change occurred, (iii) the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series B then Outstanding, and (iv) the aggregate principal amount of the Montana Term Loan Bonds then outstanding under the Montana Mortgage.  The Trustee may conclusively presume that the Term Loan Applicable Share is 28.00% unless and until the Trustee receives a Term Loan Applicable Share Certificate.  Following receipt by the Trustee of a Term Loan Applicable Share Certificate, the Trustee may conclusively presume that the Term Loan Applicable Share is as set forth in such Term Loan Applicable Share Certificate unless and until the Trustee receives a subsequent Term Loan Applicable Share Certificate.

First Mortgage Bonds, Collateral (2004) Series B shall mature on November 1, 2011 (the “Term Loan Maturity Date”), with (i) an installment of the principal of the First Mortgage Bonds, Collateral (2004) Series B in an amount equal to $70,000 (said amount representing one quarter of one percent (0.25%) of the original aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series B) to be payable on each March 31, June 30, September 30 and December 31, commencing March 31, 2005 and continuing through and including September 30, 2010, (ii) an installment of the principal amount of First Mortgage Bonds, Collateral (2004) Series B in an amount equal to $6,580,000 (said amount representing twenty-three and one-half percent (23.5%) of the original aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series B) to be payable on December 31, 2010, March 31, 2011 and June 30, 2011, and (iii) the balance of the principal of the First Mortgage Bonds, Collateral (2004) Series B to be payable on the Term Loan Maturity Date (in each case,

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unless an equal installment or balance of principal of the Term Loans is not due and payable on such day or on the Term Loan Maturity Date, as applicable, in accordance with the Credit Agreement by reason of prior prepayment of the Term Loans (in which event, there shall be due and payable on the First Mortgage Bonds, Collateral (2004) Series B on such day or on the Term Loan Maturity Date, as applicable, an amount of principal of said Bonds equal to the Term Loan Applicable Share of the amount of principal of the Term Loans that is payable on such day or on the Term Loan Maturity Date, as applicable, in accordance with the Credit Agreement); the unpaid principal amount of the First Mortgage Bonds, Collateral (2004) Series B shall bear interest at one or more variable interest rates per annum which rate or rates for each day shall be equal to the rate or rates per annum borne by the Term Loans in accordance with the Credit Agreement for such day (calculated in the manner provided in the Credit Agreement for the calculation of interest on the Term Loans), payable on each day on which interest is payable on the Term Loans in accordance with the Credit Agreement (and in an amount equal to the Term Loan Applicable Share of the amount of interest that is payable on the Term Loans on such day in accordance with the Credit Agreement) to the Collateral Agent, as the registered owner, without regard to, or necessity for, any record date; the principal of and interest on each said Bond to be payable at the office or agency of the Company in the Borough of Manhattan, The City of New York, in such coin or currency of the United States of America as at the time of payment is legal tender for public and private debts.  First Mortgage Bonds, Collateral (2004) Series B shall be dated as in Section 3.03(c) of the Original Indenture (as supplemented) provided.

As permitted pursuant to Sections 3.01 and 5.06 of the Indenture (as supplemented), scheduled amortization payments with respect to the First Mortgage Bonds, Collateral (2004) Series B (as specified for the First Mortgage Bonds, Collateral (2004) Series B prior to the Term Loan Maturity Date pursuant to the preceding paragraph of this Section 1) shall not constitute a redemption in part of the First Mortgage Bonds, Collateral (2004) Series B for purposes of Section 5.06 of the Indenture (as supplemented) (and, therefore, surrender of the First Mortgage Bonds, Collateral (2004) Series B shall not be a condition to the receipt by the registered owners of the First Mortgage Bonds, Collateral (2004) Series B of such scheduled amortization payments).

SECTION 2.  First Mortgage Bonds, Collateral (2004) Series B shall be issued only as registered Bonds without coupons of the denomination of $1,000, or any integral multiple of $1 in excess of $1,000, appropriately numbered.  First Mortgage Bonds, Collateral (2004) Series B may be exchanged, upon surrender thereof, at the office or agency of the Company in the Borough of Manhattan, The City of New York, State of New York, for one or more First Mortgage Bonds, Collateral (2004) Series B of other authorized denominations, for the same aggregate principal amount, subject to the terms and conditions set forth in the Indenture.

First Mortgage Bonds, Collateral (2004) Series B shall not be transferable except to any successor Collateral Agent under the Collateral Agreement.  As a condition precedent to any transfer of the First Mortgage Bonds, Collateral (2004) Series B by the Collateral Agent, the Collateral Agent shall submit to the Company, the Trustee and the

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Bond Registrar (in addition to all other documents and instruments required to be submitted to the Bond Registrar pursuant to the Indenture) a certificate of the Collateral Agent, signed by a person purporting to be its duly authorized officer, certifying that the transferee in such transfer is a successor Collateral Agent under the Collateral Agreement (and the Trustee and the Bond Registrar may conclusively presume the statements in any such certificate of the Collateral Agent to be correct).

Any transfer of First Mortgage Bonds, Collateral (2004) Series B (i) shall be subject to the provisions of Section 3.05 of the Indenture, except that the provisions of paragraph (g) of such Section 3.05 shall not be applicable to any transfer of First Mortgage Bonds, Collateral (2004) Series B to a successor Collateral Agent under the Collateral Agreement, and (ii) shall be made at the office or agency of the Company in the Borough of Manhattan, The City of New York.

The Company hereby waives any right to make any charge for any exchange or transfer of First Mortgage Bonds, Collateral (2004) Series B by the Collateral Agent, whether to reimburse itself for any tax or taxes or other governmental charge or otherwise (it being understood that the Company shall pay any tax or taxes or governmental or other charge which may be payable by reason of any exchange or transfer of First Mortgage Bonds, Collateral (2004) Series B by the Collateral Agent).

The Company has appointed JPMorgan Chase Bank as its agent to receive First Mortgage Bonds, Collateral (2004) Series B presented or surrendered for payment, to receive First Mortgage Bonds, Collateral (2004) Series B surrendered for registration of transfer or exchange and to receive notices and demands to or upon the Company in respect of the First Mortgage Bonds, Collateral (2004) Series B and the Indenture; and the corporate trust office of JPMorgan Chase Bank in the Borough of Manhattan, The City of New York, State of New York shall be the office or agency of the Company in the Borough of Manhattan, The City of New York, State of New York at which such presentations, surrenders, notices and demands may be made or served.

SECTION 3.  First Mortgage Bonds, Collateral (2004) Series B shall be subject to the following redemption and other terms and conditions:

(I)            First Mortgage Bonds, Collateral (2004) Series B shall be subject to redemption as follows (but shall not otherwise be or become subject to redemption, whether at the option of the holders thereof or the Company or pursuant to any other requirements or provisions of the Indenture):  (A) on each day on which the Term Loans are prepaid in accordance with the Credit Agreement, First Mortgage Bonds, Collateral (2004) Series B shall be deemed to have been redeemed in an aggregate principal amount equal to the Term Loan Applicable Share of the aggregate principal amount of the Term Loans that are so prepaid on such day (a “Term Loan Prepayment Redemption”); and (B) on each day on which the Term Loans are accelerated in accordance with the Credit Agreement (an “Acceleration Redemption Date”), the entire aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series B shall be subject to mandatory redemption by the Company (an “Acceleration Redemption”); in each case, without any necessity for notice or call by the Company or by the Trustee (such notice and call being

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waived by the registered owners of the First Mortgage Bonds, Collateral (2004) Series B by the acceptance of the First Mortgage Bonds, Collateral (2004) Series B and in connection with each Redemption Demand hereinafter described); provided, however, that in the event of a rescission or annulment of an acceleration of the Term Loans pursuant to the Credit Agreement or otherwise, the related Acceleration Redemption shall be deemed to be rescinded or annulled (without prejudice to the occurrence of another Acceleration Redemption upon and by reason of a subsequent acceleration of the Term Loans in accordance with the Credit Agreement).  Acceleration Redemption of First Mortgage Bonds, Collateral (2004) Series B on an Acceleration Redemption Date shall be at a redemption price equal to the principal amount of the First Mortgage Bonds, Collateral (2004) Series B (without premium), together with interest accrued on said principal to and including the date of redemption (collectively, an “Acceleration Redemption Amount”);  and such Acceleration Redemption Amount shall be due and payable on the First Mortgage Bonds, Collateral (2004) Series B on such Acceleration Redemption Date.  In the event of any failure by the Company to pay when due the Acceleration Redemption Amount with respect to an Acceleration Redemption of First Mortgage Bonds, Collateral (2004) Series B, interest shall accrue on such unpaid Acceleration Redemption Amount at the rates (and in amounts equal to the Term Loan Applicable Share of the amounts) of interest that accrue on the corresponding unpaid principal of and interest on the Term Loans in accordance with the Credit Agreement.

The Trustee may conclusively presume that no redemption of First Mortgage Bonds, Collateral (2004) Series B is deemed to have occurred (in the case of a Term Loan Prepayment Redemption) or is required (in the case of an Acceleration Redemption unless and until it shall have received a written notice from the Administrative Agent, signed by a person purporting to be its duly authorized officer, stating that Term Loans have been prepaid or have been accelerated, in either case, in accordance with the Credit Agreement (a “Redemption Demand”).  Each Redemption Demand also shall state (i) the date on which the Term Loans were prepaid or accelerated in accordance with the Credit Agreement, (ii) the principal amount of the Term Loans so prepaid or accelerated on such date, (iii) the principal amount of First Mortgage Bonds, Collateral (2004) Series B that are deemed to have been redeemed or are to be redeemed on such date in accordance with this Supplemental Indenture by reason of such prepayment or acceleration, and (iv) in the case of an Acceleration Redemption, the Acceleration Redemption Amount payable with respect to the First Mortgage Bonds, Collateral (2004) Series B (determined in accordance with this Supplemental Indenture) and setting forth the amounts of the respective portions thereof representing principal of and interest on the First Mortgage Bonds, Collateral (2004) Series B.  Each Redemption Demand shall be deemed to constitute a written waiver by the Collateral Agent, as registered owner of all First Mortgage Bonds, Collateral (2004) Series B then Outstanding, of notice of redemption and call for redemption by the Company or the Trustee of the First Mortgage Bonds, Collateral (2004) Series B deemed redeemed or subject to redemption as described in such Redemption Demand.  The Trustee may conclusively presume the statements contained in each Redemption Demand to be correct (and the Trustee shall be fully protected in relying thereon).

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The Trustee may conclusively presume that no rescission or annulment of an Acceleration Redemption (in respect of which the Trustee has received a Redemption Demand) is required unless and until it shall have received a written notice from the Administrative Agent, signed by a person purporting to be its duly authorized officer, stating that the acceleration of the Term Loans has been rescinded or annulled in accordance with the Credit Agreement or otherwise (a “Rescission Notice”).  Each Rescission Notice also shall state the date on which the acceleration of the Term Loans was rescinded or annulled in accordance with the Credit Agreement or otherwise and, as consequence, the redemption of the First Mortgage Bonds, Collateral (2004) Series B was rescinded or annulled in accordance with this Supplemental Indenture.  The Trustee may conclusively presume the statements contained in any Rescission Notice to be correct (and the Trustee shall be fully protected in relying thereon).

Pursuant to (and by reason of the provisions of Section 10.2 of) the Credit Agreement, the Administrative Agent has agreed to submit to the Trustee (with copies to the Collateral Agent and the Company) (i) a Redemption Demand with respect to, and in connection with, each event that gives rise to a redemption (deemed or actual) of First Mortgage Bonds, Collateral (2004) Series B, and (ii) a Rescission Notice in connection with any event that gives rise to the rescission or annulment of an Acceleration Redemption.  Pursuant to the Collateral Agreement, the Collateral Agent has agreed, upon written request of the Company and so long as no Default or Event of Default described in Section 8(f) of the Credit Agreement shall have occurred and be continuing, to surrender or exchange its First Mortgage Bond, Collateral (2004) Series B or First Mortgage Bonds, Collateral (2004) Series B, from time to time (including, without limitation, promptly following each redemption (deemed or actual) of First Mortgage Bonds, Collateral (2004) Series B), so that at all times the Collateral Agent is holding one or more First Mortgage Bonds, Collateral (2004) Series B in an aggregate principal amount equal to, but not in excess of, the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series B that are then Outstanding (and the Term Loan Applicable Share of the aggregate principal amount of Term Loans that are then outstanding under the Credit Agreement).

(II)           It is expressly stated (for the avoidance of any doubt) that, notwithstanding anything herein or in any First Mortgage Bonds, Collateral (2004) Series B to the contrary (other than the provisions of subdivision IV below), each payment of principal of or interest on the First Mortgage Bonds, Collateral (2004) Series B that becomes due and payable on any day in accordance with this Supplemental Indenture (whether by reason of stated due date, acceleration, redemption or otherwise) shall correspond to, and be equal to, the Term Loan Applicable Share of, a payment of principal of or interest on the Term Loans that becomes due and payable on such day in accordance with the Credit Agreement.

(III)         The obligation of the Company to make each payment of principal of or interest on the First Mortgage Bonds, Collateral (2004) Series B that becomes due and payable in accordance with this Supplemental Indenture (A) shall be fully satisfied and discharged if the corresponding payment of the principal of or interest on the Term Loans shall have been fully paid under and in accordance with the Credit Agreement, and

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(B) shall be partially satisfied and discharged if the corresponding payment of the principal of or interest on the Term Loans shall have been partially paid under and in accordance with the Credit Agreement (such partial satisfaction and discharge with respect to the First Mortgage Bonds, Collateral (2004) Series B to be in an amount equal to the Term Loan Applicable Share of the amount of such partial payment with respect to the Term Loans).  The Trustee may conclusively presume that the obligation of the Company to make payments with respect to the principal of and interest on the First Mortgage Bonds, Collateral (2004) Series B shall have been fully satisfied and discharged unless and until the Trustee shall have received a written notice from the Administrative Agent, signed by a person purporting to be its duly authorized officer, stating (i) that the Company has failed to make timely payment in full or in part of an amount of principal of and/or interest on the Term Loans which became due and payable in accordance with the Credit Agreement, (ii) the amount and date of such payment of principal of and/or interest on the Term Loans which the Company has failed to make in accordance with the Credit Agreement, and (iii) the amount of principal of and/or interest on the First Mortgage Bonds, Collateral (2004) Series B which, in accordance with this Supplemental Indenture, has not been satisfied and discharged by reason of such failure of the Company.  The Trustee may conclusively presume the statements contained in any such notice from the Administrative Agent to be correct unless and until the Trustee shall receive a subsequent and/or modified notice from the Administrative Agent pursuant to and in accordance with this subdivision (III) (and the Trustee shall be fully protected in relying thereon).  Without limitation of the foregoing, and for the avoidance of any doubt, it is expressly stated that the Trustee shall not be responsible for (i) the calculation of interest on the First Mortgage Bonds, Collateral (2004) Series B, or (ii) the determination of any amount (including, without limitation, any principal of or interest on the Term Loans) that is payable or paid under the Credit Agreement.

(IV)         Nothing herein or in any of the First Mortgage Bonds, Collateral (2004) Series B (including, without limitation, any reference to the principal payable with respect to the First Mortgage Bonds, Collateral (2004) Series B being determined on the basis of the Term Loan Applicable Share of the principal payable with respect to the Term Loans) shall, or shall be deemed or construed to, (A) increase the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series B that are Outstanding from time to time, (B) cause or permit an amount of principal of the First Mortgage Bonds, Collateral (2004) Series B to be or to become due and payable which, when added to all other principal of such Bonds theretofore paid, exceeds $28,000,000, or (C) cause or permit to be or to become due and payable interest on the First Mortgage Bonds, Collateral (2004) Series B which is payable on any principal of the First Mortgage Bonds, Collateral (2004) Series B that is in excess of the principal of the First Mortgage Bonds, Collateral (2004) Series B as restricted pursuant to the preceding clauses (A) and (B).

SECTION 4.  The First Mortgage Bonds, Collateral (2004) Series B and the Trustee’s Certificate of Authentication shall be substantially in the form attached hereto as Exhibit B.

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ARTICLE III
DESCRIPTION OF FIRST MORTGAGE BONDS, COLLATERAL (2004)
SERIES C

SECTION 1.  The Company hereby creates a new series of Bonds to be known as “First Mortgage Bonds, Collateral (2004) Series C, due 2014.”  The First Mortgage Bonds, Collateral (2004) Series C shall be executed, authenticated and delivered in accordance with the provisions of, and shall in all respects be subject to, all of the terms, conditions and covenants of the Indenture, as supplemented and modified.  The aggregate principal amount of First Mortgage Bonds, Collateral (2004) Series C which may be authenticated and delivered under the Indenture (except for First Mortgage Bonds, Collateral (2004) Series C authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of, other First Mortgage Bonds, Collateral (2004) Series C pursuant to the Indenture and except for First Mortgage Bonds, Collateral (2004) Series C which, pursuant to the Indenture, are deemed never to have been authenticated and delivered under the Indenture) is limited to $64,000,000.

First Mortgage Bonds, Collateral (2004) Series C shall be issued to and registered in the name of U.S. Bank National Association, as trustee (together with its successors in such capacity, the “Senior Note Trustee”) under the Indenture, dated as of November 1, 2004, between the Company and the Senior Note Trustee, as supplemented and amended by Supplemental Indenture No. 1, dated as of November 1, 2004 (as so supplemented and amended and as may be further supplemented, amended or otherwise modified in accordance with its terms, the “Senior Note Indenture”), to be owned and held by the Senior Note Trustee under the terms of the Senior Note Indenture as security for the payment of the principal of, premium (if any) and interest on a series of senior secured notes of the Company issued pursuant to the Senior Note Indenture designated “Senior Secured Notes, 5.875% Series A due 2014” (the “Series A Senior Notes”) and, if and to the extent issued and delivered in exchange for the Series A Senior Notes subject to and in accordance with the Senior Note Indenture, a series of senior secured notes of the Company designated “Senior Secured Notes, 5.875% Exchange Series A due 2014” (the “Series A Exchange Notes”).  The Series A Notes and, if and to the extent issued in exchange for Series A Senior Notes subject to and in accordance with the Senior Note Indenture, the Series A Exchange Notes are referred to hereinafter, collectively, as the “Senior Notes”.  For purposes of the Senior Note Indenture, First Mortgage Bonds, Collateral (2004) Series C, together with the Montana Senior Notes Bonds (as such term is hereinafter defined), are “the related or corresponding First Mortgage Bonds” with respect to the Senior Notes.

As used herein, “Senior Notes Applicable Share” means, as of any day, a fraction (expressed as a percentage rounded to the eighth decimal place), (i) the numerator of which is the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series C that are Outstanding on such day, and (ii) the denominator of which is the sum of (a) the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series C that are Outstanding on such day, plus (b) the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series C, due 2014, of the Company (the “Montana Senior Notes Bonds”) that are outstanding on such day under the Montana

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Mortgage.  Simultaneously with the issuance and registration of the First Mortgage Bonds, Collateral (2004) Series C in the name of the Senior Note Trustee (for the same purpose), the Montana Senior Notes Bonds will be issued to and registered in the name of the Senior Note Trustee, to be owned and held by the Senior Note Trustee under the terms of the Senior Note Indenture as security for the payment of the principal of, premium (if any) and interest on the Senior Notes.  Initially, the Senior Notes Applicable Share will be 28.44444444% (being the expression as a percentage (rounded to the eighth decimal place) of a fraction, the numerator of which is $64,000,000 (the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series C that are to be issued and become Outstanding) and the denominator of which is $225,000,000 (the sum of $64,000,000, the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series C that are to be issued and become Outstanding, plus $161,000,000, the aggregate principal amount of the Montana Senior Notes Bonds that are to be issued and become outstanding under the Montana Mortgage simultaneously with the issuance of the First Mortgage Bonds, Collateral (2004) Series C).  Pursuant to the Senior Note Indenture, the Senior Note Trustee has agreed to furnish to the Trustee (with a copy to the Company) as soon as practicable after any change in the Senior Notes Applicable Share, a certificate, signed by a person purporting to be its duly authorized officer, notifying the Trustee of such change in the Senior Notes Applicable Share (a “Senior Notes Applicable Share Certificate”).  Each Senior Notes Applicable Share Certificate shall set forth (i) the changed Senior Notes Applicable Share, (ii) the date such change occurred, (iii) the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series C then Outstanding, and (iv) the aggregate principal amount of the Montana Senior Notes Bonds then outstanding under the Montana Mortgage.  The Trustee may conclusively presume that the Senior Notes Applicable Share is 28.44444444% unless and until the Trustee receives a Senior Notes Applicable Share Certificate.  Following receipt by the Trustee of a Senior Notes Applicable Share Certificate, the Trustee may conclusively presume that the Senior Notes Applicable Share is as set forth in such Senior Notes Applicable Share Certificate unless and until the Trustee receives a subsequent Senior Notes Applicable Share Certificate (and the Trustee shall be fully protected in relying thereon).

First Mortgage Bonds, Collateral (2004) Series C shall mature on November 1, 2014 (the “Senior Notes Maturity Date”), with the unpaid principal of the First Mortgage Bonds, Collateral (2004) Series C to be due and payable on the Senior Notes Maturity Date; the unpaid principal amount of the Bonds of the First Mortgage Bonds, Collateral (2004) Series C shall bear interest at the rate of five and seven eighth percent (5.875%) per annum (calculated in the same manner as interest is calculated on the Senior Notes in accordance with the Senior Note Indenture), payable semiannually on the first (1st) day of each May and November, commencing on May 1, 2005 and continuing until the principal of the First Mortgage Bonds, Collateral (2004) Series C is paid (or provided for in accordance with the Senior Note Indenture), to the Senior Note Trustee as the registered owner, without regard to, or necessity for, any record date; principal of, premium (if any) and interest on each said Bond to be payable at the office or agency of the Company in the Borough of Manhattan, The City of New York, in such coin or currency of the United States of America as at the time of payment is legal tender for public and private debts.  First Mortgage Bonds, Collateral (2004) Series C shall be dated as in Section 3.03(c) of the Original Indenture (as supplemented) provided.

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SECTION 2.  First Mortgage Bonds, Collateral (2004) Series C shall be issued only as registered Bonds without coupons of the denomination of $1,000, or any integral multiple of $1 in excess of $1,000, appropriately numbered.  First Mortgage Bonds, Collateral (2004) Series C may be exchanged, upon surrender thereof, at the office or agency of the Company in the Borough of Manhattan, The City of New York, State of New York, for one or more First Mortgage Bonds, Collateral (2004) Series C of other authorized denominations, for the same aggregate principal amount, subject to the terms and conditions set forth in the Indenture.

First Mortgage Bonds, Collateral (2004) Series C shall not be transferable except to any successor Senior Note Trustee under the Senior Note Indenture.  As a condition precedent to any transfer of the First Mortgage Bonds, Collateral (2004) Series C by the Senior Note Trustee, the Senior Note Trustee shall submit to the Company, the Trustee and the Bond Registrar (in addition to all other documents and instruments required to be submitted to the Bond Registrar pursuant to the Indenture) a certificate of the Senior Note Trustee, signed by a person purporting to be its duly authorized officer, certifying that the transferee in such transfer is a successor Senior Note Trustee under the Senior Note Indenture (and the Trustee and the Bond Registrar may conclusively presume the statements in any such certificate of the Senior Note Trustee to be correct and shall fully be protected in relying thereon).

Any transfer of First Mortgage Bonds, Collateral (2004) Series C (i) shall be subject to the provisions of Section 3.05 of the Indenture, except that the provisions of paragraph (g) of such Section 3.05 shall not be applicable to any transfer of First Mortgage Bonds, Collateral (2004) Series C to a successor Senior Note Trustee under the Senior Note Indenture (and the Company hereby waives the provisions of such paragraph with respect to any such transfer), and (ii) shall be made at the office or agency of the Company in the Borough of Manhattan, The City of New York.

The Company hereby waives any right to make any charge for any exchange or transfer of First Mortgage Bonds, Collateral (2004) Series C by the Senior Note Trustee, whether to reimburse itself for any tax or taxes or other governmental charge or otherwise (it being understood that the Company shall pay any tax or taxes or governmental or other charge which may be payable by reason of any exchange or transfer of First Mortgage Bonds, Collateral (2004) Series C by the Senior Note Trustee to a successor Senior Note Trustee under the Senior Note Indenture).

The Company has appointed JPMorgan Chase Bank as its agent to receive First Mortgage Bonds, Collateral (2004) Series C presented or surrendered for payment, to receive First Mortgage Bonds, Collateral (2004) Series C surrendered for registration of transfer or exchange and to receive notices and demands to or upon the Company in respect of the First Mortgage Bonds, Collateral (2004) Series C and the Indenture; and the corporate trust office of JPMorgan Chase Bank in the Borough of Manhattan, The City of New York, State of New York shall be the office or agency of the Company in the Borough of Manhattan, The City of New York, State of New York at which such presentations, surrenders, notices and demands may be made or served.

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SECTION 3.  First Mortgage Bonds, Collateral (2004) Series C shall be subject to the following redemption and other terms and conditions:

(I)            First Mortgage Bonds, Collateral (2004) Series C shall be subject to redemption as follows (but shall not otherwise be or become subject to redemption, whether at the option of the holders thereof or the Company or pursuant to any other requirements or provisions of the Indenture):  (A) on each day on which Senior Notes become due and payable in accordance with Section 405 of the Senior Note Indenture by reason of redemption in accordance with the Senior Note Indenture (a “Senior Notes Redemption Payment Date”), First Mortgage Bonds, Collateral (2004) Series C shall be subject to mandatory redemption by the Company in an aggregate principal amount equal to the Senior Notes Applicable Share of the aggregate principal amount of the Senior Notes that become so due and payable on such Senior Notes Redemption Payment Date (a “Corresponding Redemption”); and (B) on each day on which the Senior Notes become due and payable in accordance with Section 702 of the Senior Note Indenture by reason of acceleration of the Senior Notes in accordance with the Senior Note Indenture (a “Senior Notes Acceleration Payment Date”), the entire aggregate principal amount of First Mortgage Bonds, Collateral (2004) Series C shall be subject to mandatory redemption by the Company (an “Acceleration Redemption”); in each case, without any necessity for notice or call by the Company or by the Trustee (such notice and call being waived by the registered owners of First Mortgage Bonds, Collateral (2004) Series C by the acceptance of First Mortgage Bonds, Collateral (2004) Series C and in connection with each Redemption Demand hereinafter described); provided, however, that in the event of a rescission or annulment of an acceleration of the Senior Notes pursuant to the Senior Note Indenture, the related Acceleration Redemption shall be deemed to be rescinded or annulled (without prejudice to the occurrence of another Acceleration Redemption upon and by reason of a subsequent acceleration of the Senior Notes in accordance with the Senior Note Indenture).

Each Corresponding Redemption of First Mortgage Bonds, Collateral (2004) Series C shall be at a redemption price equal to the redemption price payable in connection with the redemption of Senior Notes to which it corresponds (consisting of principal of and, if applicable to such redemption of Senior Notes in accordance with the Senior Note Indenture, premium on such Senior Notes), together with interest accrued on the principal included in such redemption price to such Senior Notes Redemption Payment Date (a “Corresponding Redemption Amount”); and such Corresponding Redemption Amount shall be due and payable on such Senior Notes Redemption Payment Date.  Each Acceleration Redemption of First Mortgage Bonds, Collateral (2004) Series C on a Senior Notes Acceleration Payment Date shall be at a redemption price equal to the principal amount of the First Mortgage Bonds, Collateral (2004) Series C (without premium), together with interest accrued on said principal to the date of redemption (an “Acceleration Redemption Amount”); and such Acceleration Redemption Amount shall be due and payable on such Senior Notes Acceleration Payment Date.  In the event of any failure by the Company to pay when due the Corresponding Redemption Amount with respect to a Corresponding Redemption of First Mortgage Bonds, Collateral (2004) Series C or the Acceleration Redemption Amount with respect to an Acceleration Redemption of First Mortgage Bonds, Collateral (2004) Series C, interest shall accrue on

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such unpaid Corresponding Redemption Amount or such unpaid Acceleration Redemption Amount at the rates (and in amounts equal to the Senior Notes Applicable Share of the amounts) of interest that accrue on the corresponding unpaid principal of, premium (if any) and interest on the Senior Notes in accordance with the Senior Note Indenture.

The Trustee may conclusively presume that no redemption of First Mortgage Bonds, Collateral (2004) Series C is required unless and until it shall have received a written notice from the Senior Note Trustee, signed by a person purporting to be its duly authorized officer, stating that Senior Notes became due and payable pursuant to Section 405 or 702 of the Senior Note Indenture by reason of redemption or acceleration in accordance with the Senior Note Indenture (a “Redemption Demand”).  Each Redemption Demand also shall state (i) the date on which Senior Notes became due and payable by reason of redemption or acceleration in accordance with the Senior Note Indenture, (ii) the principal amount of the Senior Notes that became so due and payable on such date, (iii) the principal amount of First Mortgage Bonds, Collateral (2004) Series C to be redeemed on such date in accordance with this Supplemental Indenture by reason of such redemption or acceleration, and (iv) the Corresponding Redemption Amount or the Acceleration Redemption Amount payable on such date with respect to First Mortgage Bonds, Collateral (2004) Series C (determined in accordance with this Supplemental Indenture) and setting forth the amounts of the respective portions thereof representing principal of, premium (if any) and interest on First Mortgage Bonds, Collateral (2004) Series C.  Each Redemption Demand shall be deemed to constitute a waiver by the Senior Note Trustee, as registered owner of all First Mortgage Bonds, Collateral (2004) Series C then Outstanding, of notice of redemption and call for redemption by the Company or the Trustee of First Mortgage Bonds, Collateral (2004) Series C subject to redemption as described in such Redemption Demand.  The Trustee may conclusively presume the statements contained in each Redemption Demand to be correct (and the Trustee shall be fully protected in relying thereon).

The Trustee may conclusively presume that no rescission or annulment of an Acceleration Redemption (in respect of which the Trustee has received a Redemption Demand) is required unless and until it shall have received a written notice from the Senior Note Trustee, signed by a person purporting to be its duly authorized officer, stating that the acceleration of the Senior Notes has been rescinded or annulled in accordance with the Senior Note Indenture (a “Rescission Notice”).  Each Rescission Notice also shall state the date on which the acceleration of the Senior Notes was rescinded or annulled in accordance with the Senior Note Indenture and, as consequence, the redemption of First Mortgage Bonds, Collateral (2004) Series C was rescinded or annulled in accordance with this Supplemental Indenture.  The Trustee may conclusively presume the statements contained in any Rescission Notice to be correct (and the Trustee shall be fully protected in relying thereon).

(II)           It is expressly stated (for the avoidance of any doubt) that, notwithstanding anything herein or in any First Mortgage Bonds, Collateral (2004) Series C to the contrary (other than the provisions of subdivision (IV) below), each payment of principal of, premium (if any) or interest on the First Mortgage Bonds, Collateral (2004) Series C

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that becomes due and payable on any day in accordance with this Supplemental Indenture (whether by reason of stated due date, acceleration, redemption or otherwise) shall correspond to, and be equal to, the Senior Notes Applicable Share of, a payment of principal of, premium (if any) or interest on the Senior Notes that becomes due and payable on such day in accordance with the Senior Note Indenture.

(III)         The obligation of the Company to make each payment of principal of, premium (if any) or interest on the First Mortgage Bonds, Collateral (2004) Series C that becomes due and payable in accordance with this Supplemental Indenture (A) shall be fully satisfied and discharged if the corresponding payment of the principal of, premium (if any) or interest on the Senior Notes shall have been fully paid, or if provision for the full payment of the Senior Notes shall have been made (by depositing moneys sufficient for such full payment with the Senior Note Trustee), in either case under and in accordance with the Senior Note Indenture, and (B) shall be partially satisfied and discharged if the corresponding payment of the principal of, premium (if any) or interest on the Senior Notes shall have been partially paid, or if provision for the partial payment of the Senior Notes shall have been made (by depositing moneys sufficient for such partial payment with the Senior Note Trustee), in either case under and in accordance with the Senior Note Indenture (such partial satisfaction and discharge with respect to the First Mortgage Bonds, Collateral (2004) Series C to be in an amount equal to the Senior Notes Applicable Share of the amount of such partial payment or provision for partial payment with respect to the Senior Notes).  The Trustee may conclusively presume that the obligation of the Company to make payments with respect to the principal of, premium (if any) and interest on the First Mortgage Bonds, Collateral (2004) Series C has been fully satisfied and discharged unless and until the Trustee shall have received a written notice from the Senior Note Trustee, signed by a person purporting to be its duly authorized officer, stating (i) that the Company has failed to make timely payment in full or in part of an amount of principal of, premium (if any) and/or interest on the Senior Notes which became due and payable in accordance with the Senior Note Indenture, (ii) the amount and date of such payment of principal of, premium (if any) and/or interest on the Senior Notes which the Company has failed to make in accordance with the Senior Note Indenture, and (iii) the amount of principal of, premium (if any) and/or interest on the First Mortgage Bonds, Collateral (2004) Series C which, in accordance with this Supplemental Indenture, has not been satisfied and discharged by reason of such failure of the Company.  The Trustee may conclusively presume the statements contained in any such notice from the Senior Note Trustee to be correct unless and until the Trustee shall receive a subsequent and/or modified notice from the Senior Note Trustee pursuant to and in accordance with this subdivision (III) (and the Trustee shall be fully protected in relying thereon).  Without limitation of the foregoing, and for the avoidance of any doubt, it is expressly stated that the Trustee shall not be responsible for (i) the calculation of interest on the First Mortgage Bonds, Collateral (2004) Series C, or (ii) the determination of any amount (including, without limitation, any principal of, premium (if any) or interest on the Senior Notes) that is payable or paid under the Senior Note Indenture.

(IV)         Nothing herein or in any of the First Mortgage Bonds, Collateral (2004) Series C (including, without limitation, any reference to the principal payable with respect to the First Mortgage Bonds, Collateral (2004) Series C being determined on the

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basis of the Senior Notes Applicable Share of the principal payable with respect to the Senior Notes) shall, or shall be deemed or construed to, (A) increase the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series C that are Outstanding from time to time, (B) cause or permit an amount of principal of the First Mortgage Bonds, Collateral (2004) Series C to be or to become due and payable which, when added to all other principal of such Bonds theretofore paid, exceeds $64,000,000, or (C) cause or permit to be or to become due and payable interest on the First Mortgage Bonds, Collateral (2004) Series C which is payable on any principal of the First Mortgage Bonds, Collateral (2004) Series C that is in excess of the principal of the First Mortgage Bonds, Collateral (2004) Series C as restricted pursuant to the preceding clauses (A) and (B).

SECTION 4.  The First Mortgage Bonds, Collateral (2004) Series C and the Trustee’s Certificate of Authentication shall be substantially in the form attached hereto as Exhibit C.

ARTICLE IV
ISSUE OF
FIRST MORTGAGE BONDS, COLLATERAL (2004) SERIES A,
FIRST MORTGAGE BONDS, COLLATERAL (2004) SERIES B,
AND FIRST MORTGAGE BONDS, COLLATERAL (2004) SERIES C

SECTION 1.  The Company hereby exercises the right to obtain the authentication of $110,000,000 principal amount of Bonds pursuant to the terms of Section 4.04 of the Indenture.  Such Bonds shall be $35,000,000 principal amount of First Mortgage Bonds, Collateral (2004) Series A, $28,000,000 principal amount of First Mortgage Bonds, Collateral (2004) Series B, and $47,000,000 principal amount of First Mortgage Bonds, Collateral (2004) Series C.

SECTION 2.  The Company hereby exercises the right to obtain the authentication of $17,000,000 principal amount of Bonds pursuant to the terms of Section 4.03 of the Indenture.  All such Bonds shall be First Mortgage Bonds, Collateral (2004) Series C.

SECTION 3.  Such First Mortgage Bonds, Collateral (2004) Series A, First Mortgage Bonds, Collateral (2004) Series B, and First Mortgage Bonds, Collateral (2004) Series C may be authenticated and delivered prior to the filing for recordation of this Supplemental Indenture.

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ARTICLE V
AMENDMENTS TO MORTGAGE

SECTION 1.  Section 1.03 of the Original Indenture is amended by adding at the end thereof the following additional paragraph:

Notwithstanding anything herein to the contrary, (i) with respect to the Net Earnings Certificate required as a condition to the issuance of First Mortgage Bonds, Collateral (2004) Series A, First Mortgage Bonds, Collateral (2004) Series B, and First Mortgage Bonds, Collateral (2004) Series C, pursuant to Section 4.03 and, if applicable, Section 4.04 of the Original Indenture, and (ii) with respect to each Net Earnings Certificate required at any time at which (a) any of the First Mortgage Bonds, Collateral (2004) Series A, First Mortgage Bonds, Collateral (2004) Series B, and First Mortgage Bonds, Collateral (2004) Series C are Outstanding under the Indenture, and (b) any bonds are outstanding under the Montana Mortgage, the “Adjusted Net Earnings of the Company” shall be, and shall be stated in such Net Earnings Certificate to be, the lesser of (A) the amount (for the applicable period selected in accordance with paragraph (a) of this Section 1.03) determined in accordance with paragraph (a) of this Section 1.03 (and the other provisions of this Section 1.03 that are relevant to such paragraph) on the basis of (i) the items set forth in clauses (i) and (ii) of paragraph (a) of this Section 1.03 being such portions of such items of the Company as have been reasonably allocated by the Company to or from the Mortgaged Property as a plant or plants and an operating system or operating systems in a manner consistent with the manner of allocation utilized and/or to be utilized by the Company in making calculations of the “Adjusted Net Earnings of the Company” under and as defined in the Montana Mortgage, and (ii) the item set forth in clause (iv) of paragraph (a) of this Section 1.03 being calculated without regard to income derived by the Company from any electric and/or gas utility business of the Company in which the Mortgaged Property is not utilized (but otherwise in accordance this Section 1.03), and (B) the amount (for the applicable period selected in accordance with paragraph (a) of this Section 1.03) determined in accordance with paragraph (a) of this Section 1.03 (and the other provisions of this Section 1.03 that are relevant to such paragraph) (without any allocation or distinction as to the derivation of the items set forth in any of the clauses of paragraph (a) of this Section 1.03, other than allocation or distinction between (i) the electric and/or gas utility business or businesses in which the Company is engaged (whether or not the Mortgaged Property is utilized in connection therewith), and (ii) the other business or businesses (if any) in which the Company is engaged (with such other business or businesses being given effect under the item set forth in clause (iv) of paragraph (a) of this Section 1.03).  Each such Net Earnings Certificate shall contain a statement of the signers of such Net Earnings Certificate that, in the opinion of such signers, the allocations made in the calculations of “Adjusted Net Earnings of the Company” as set forth in such Net Earnings Certificate are in accordance with the requirements of this final paragraph of this Section 1.03.

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SECTION 2.  Section 9.01 of the Original Indenture is amended by adding at the end thereof the following additional paragraph (h):

(h)           Anything herein to the contrary notwithstanding, the Company may not effect a satisfaction and discharge as described in paragraph (a) of this Section 9.01 unless the Company delivers to the Trustee an Opinion of Counsel to the effect that the Holders of the affected Bonds (i) will not recognize income, gain or loss for United States federal income tax purposes as a result of such satisfaction and discharge, and (ii) will be subject to United States federal income tax on the same amounts, in the same manner and at the same times as if such satisfaction and discharge had not occurred.

ARTICLE VI
CONFIRMATION OF LIEN OF INDENTURE
ON CERTAIN PROPERTY

The Company hereby confirms, acknowledges and states that the property described on Exhibit D attached hereto is subject to the Lien of the Indenture pursuant to Granting Clause Second of the Original Indenture; and, for the avoidance of any doubt, the Company hereby grants, bargains, sells, conveys, assigns, transfers, mortgages, pledges, sets over and confirms to the Trustee, and grants to the Trustee a security interest in, all right, title and interest of the Company in and to such property, as security for the payment of the principal of premium, if any, and interest, if any, on all Bonds issued under the Indenture and Outstanding (as defined in the Indenture), when payable in accordance with the provisions thereof, and as security for the performance by the Company of, and compliance by the Company with, the covenants and conditions of the Indenture, TO HAVE AND TO HOLD all such property on the same terms as all other property subject to the Lien of the Indenture.

ARTICLE VII
THE TRUSTEE

The Trustee hereby accepts the trust hereby declared and provided, and agrees to perform the same upon the terms and conditions in the Indenture set forth and upon the following terms and conditions:

The Trustee shall not be responsible in any manner whatsoever for or in respect of the validity or sufficiency of this Supplemental Indenture or the due execution hereof by the Company or for or in respect of the recitals contained herein, all of which recitals are made by the Company solely. In general, each and every term and condition contained in Article Eleven of the Indenture shall apply to this Supplemental Indenture with the same force and effect as if the same were herein set forth in full, with such omissions, variations and modifications thereof as may be appropriate to make the same conform to this Supplemental Indenture.

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ARTICLE VIII
MISCELLANEOUS PROVISIONS

Except as otherwise defined herein, all capitalized terms used in this Supplemental Indenture have the meanings stated in the Original Indenture, as heretofore supplemented.

This Supplemental Indenture may be simultaneously executed in any number of counterparts, each of which when so executed shall be deemed to be an original; but such counterparts shall together constitute but one and the same instrument.

[Signature Pages Follow]

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IN WITNESS WHEREOF, NorthWestern Corporation has caused this Supplemental Indenture to be executed on its behalf by an Authorized Executive Officer as defined in the Indenture, and its corporate seal to be hereto affixed and said seal and this Supplemental Indenture to be attested by an Authorized Executive Officer as defined in the Indenture; and JPMorgan Chase Bank, in evidence of its acceptance of the trust hereby created, has caused this Supplemental Indenture to be executed on its behalf by its President or one of its Vice Presidents and its corporate seal to be hereto affixed and said seal and this Supplemental Indenture to be attested by its Secretary or one of its Trust Officers; all as of the 1st day of November, 2004.

	NORTHWESTERN CORPORATION
	By	/s/ Brian B. Bird
	Brian B. Bird
	(CORPORATE SEAL)
ATTEST:
/s/ Thomas J. Knapp
Thomas J. Knapp
	JPMORGAN CHASE BANK
	By	/s/ L. O’Brien
	Vice President
(CORPORATE SEAL)
ATTEST:
/s/ Rosa Cioccia
Trust Officer

STATE OF NEW YORK	)
	) SS
COUNTY OF NEW YORK	)

BE IT REMEMBERED, that on this 1st day of November, 2004, before me, Keith M. Wixson, a Notary Public within and for the County and State aforesaid, personally came Brian B. Bird, Vice President and Chief Financial Officer and an Authorized Executive Officer (as such term is defined in the Indenture referred to in the foregoing Supplemental Indenture) and Thomas J. Knapp, Vice President and Deputy General Counsel and an Authorized Executive Officer (as such term is defined in the Indenture referred to in the foregoing Supplemental Indenture) of NorthWestern Corporation, a Delaware corporation, who are personally known to me to be such officers, and who are personally known to me to be the same persons who executed as such officers the within instrument of writing, and such persons duly acknowledged that they signed, sealed and delivered the said instrument as their free and voluntary act as such officers and as the free and voluntary act of NorthWestern Corporation for the uses and purposes therein set forth.

IN WITNESS WHEREOF, I have hereunto subscribed my name and affixed my official seal on the day and year last above written.

	/s/ Keith M Wixson
	Notary Public, State of New York Qualified in New York County
	Commission expires	July 14, 2007
(NOTARIAL SEAL)

STATE OF NEW YORK	)
	) SS
COUNTY OF NEW YORK	)

BE IT REMEMBERED, that on this 1st day of November, 2004, before me, Emily Fayan, a Notary Public within and for the County and State aforesaid, personally came L. O’Brien, a Vice President, and Rosa Ciaccia, a Trust Officer, of JPMorgan Chase Bank, a bank organized under the laws of the State of New York, who are personally known to me to be such officers, and who are personally known to me to be the same persons who executed as such officers the within instrument of writing, and such persons duly acknowledged that they signed, sealed and delivered the said instrument as their free and voluntary act, each as such Vice President and as the free and voluntary act of JPMorgan Chase Bank for the uses and purposes therein set forth.

IN WITNESS WHEREOF, I have hereunto subscribed my name and affixed my official seal on the day and year last above written.

	/s/ Emily Fayan
	Emily Fayan
	Notary Public, State of New York Qualified in New York County
	Commission expires	Dec. 31, 2005
(NOTARIAL SEAL)

Exhibit A
to
Supplemental Indenture

Form of Bond of the First Mortgage Bonds, Collateral (2004) Series A

[FORM OF BOND OF FIRST MORTGAGE BONDS, COLLATERAL (2004) SERIES A, DUE 2009]

THIS BOND IS NOT TRANSFERABLE EXCEPT TO A SUCCESSOR COLLATERAL AGENT UNDER THE COLLATERAL AGREEMENT (AS IDENTIFIED AND DEFINED BELOW).

NORTHWESTERN CORPORATION
(Incorporated under the laws of the State of Delaware)
FIRST MORTGAGE BOND, COLLATERAL (2004) SERIES A, DUE 2009

No. R- $                            

NorthWestern Corporation, a corporation organized and existing under the laws of the State of Delaware (the “Company”, which term shall include any successor corporation as defined in the Indenture hereinafter referred to), for value received, hereby promises to pay to Lehman Commercial Paper Inc., as collateral agent under the Bond Delivery and Collateral Agreement to which reference is hereinafter made, or (subject to the transfer restrictions hereinbefore and hereinafter described) registered assigns, the sum of                                       dollars, or, if less, the unpaid principal amount of the Revolving Loans (as hereinafter defined), on the first day of November, 2009 (the “Revolving Credit Maturity Date”), in any coin or currency of the United States of America which at the time of payment is legal tender for public and private debts, and to pay interest thereon as described on the reverse hereof in like coin or currency.

The Bonds of the series of which this Bond is one have been issued to Lehman Commercial Paper Inc., as collateral agent (together with its successors in such capacity, the “Collateral Agent”) under the Bond Delivery and Collateral Agreement, dated as of the date set forth on the reverse hereof (as amended or otherwise modified, or as waived, or as replaced, in each case, from time to time in accordance with its terms, the “Collateral Agreement”), between the Company and the Collateral Agent, to secure the obligations of the Company to pay when due the Revolving Credit Applicable Share (as hereinafter defined) of the Revolving Credit Obligations (as hereinafter defined) under the Credit Agreement, dated as of the date set forth on the reverse hereof (as amended or otherwise modified, or as waived, or as replaced, in each case, from time to time in accordance with its terms, the “Credit Agreement”), among the Company, as borrower, the several lenders from time to time parties thereto (the “Lenders”), Lehman Brothers Inc. and Deutsche Bank Securities Inc., as joint lead arrangers and joint bookrunners, Deutsche Bank Securities Inc., as syndication agent, Union Bank of California, N.A. and KeyBank National Association, as co-documentation agents, Lehman Commercial Paper Inc., as administrative agent (together with its successors in such capacity, the “Administrative Agent”) and the Collateral Agent.

This Bond shall not be entitled to any benefit under the Indenture or any indenture supplemental thereto, or become valid or obligatory for any purpose, until the form of certificate endorsed herein shall have been signed by or on behalf of JPMorgan Chase Bank, the Trustee under the Indenture, or a successor trustee thereto under the Indenture, or by an authenticating agent duly appointed by the Trustee in accordance with the terms of the Indenture.

The provisions of this Bond are continued on the reverse hereof and such continued provisions shall for all purposes have the same effect as though fully set forth at this place.

IN WITNESS WHEREOF, NorthWestern Corporation has caused this Bond to be signed (manually or by facsimile signature) in its name by an Authorized Executive Officer, as defined in the Indenture, and its corporate seal (or a facsimile thereof) to be hereto affixed and attested (manually or by facsimile signature) by an Authorized Executive Officer, as defined in the Indenture.

Dated:		NORTHWESTERN CORPORATION
		By
			Authorized Executive Officer
ATTEST:
By
	Authorized Executive Officer

[FORM OF TRUSTEE’S CERTIFICATE OF AUTHENTICATION]

This is one of the Bonds of the series designated therein referred to in the within-mentioned Indenture and Supplemental Indenture dated as of November 1, 2004.

JPMORGAN CHASE BANK, AS TRUSTEE
By
	Authorized Officer

A-1

[FORM OF REVERSE OF BOND]

Indenture and Series Designation

This Bond is one of a duly authorized issue of bonds of the Company (the “Bonds”), of the series hereinafter specified, all issued and to be issued under and equally secured by a General Mortgage Indenture and Deed of Trust (the “Indenture”), dated as of August 1, 1993, executed by the Company (under its then name, NorthWestern Public Service Company) to The Chase Manhattan Bank (National Association), the predecessor to JPMorgan Chase Bank (the “Trustee”), as Trustee, to which Indenture and all indentures supplemental thereto reference is hereby made for a description of the properties mortgaged and pledged, the nature and extent of the security, the rights of registered owners of the Bonds and of the Trustee in respect thereof, and the terms and conditions upon which the Bonds are, and are to be, secured (and for the definition of any capitalized term used herein but not defined herein (with any term defined herein and in the Indenture being used herein as defined herein)).  The Bonds may be issued in series, for various principal sums, may mature at different times, may bear interest at different rates and may otherwise vary as provided in the Indenture.  This Bond is one of a series designated as the “First Mortgage Bonds, Collateral (2004) Series A, due 2009” (the “First Mortgage Bonds, Collateral (2004) Series A”) of the Company issued under and secured by the Indenture and described in the supplemental indenture dated as of November 1, 2004 (the “Supplemental Indenture”) between the Company and the Trustee, supplemental to the Indenture.

Issuance to Collateral Agent under Collateral Agreement

First Mortgage Bonds, Collateral (2004) Series A have been issued to the Collateral Agent under the Collateral Agreement to secure the obligations of the Company to pay when due the Revolving Credit Applicable Share (as hereinafter defined) of the Revolving Credit Obligations under the Credit Agreement.  Each of the Collateral Agreement and the Credit Agreement is dated as of November 1, 2004.

Principal

The unpaid principal of the First Mortgage Bonds, Collateral (2004) Series A, of which this Bond is one, is scheduled to be paid on the Revolving Credit Maturity Date.  From time to time after the issuance of the First Mortgage Bonds, Collateral (2004) Series A, and as Revolving Loans (as hereinafter defined) are prepaid and reborrowed subject to and in accordance with the Credit Agreement, (A) for purposes of determining the amount of principal payable by the Company with respect to the First Mortgage Bonds, Collateral (2004) Series A, the unpaid principal amount of the First Mortgage Bonds, Collateral (2004) Series A at any time shall be deemed to be equal to the Revolving Credit Applicable Share of the unpaid principal amount of the Revolving Loans at such time, plus, if an acceleration of the Revolving Loans shall be in effect in accordance with the Credit Agreement at such time, the amount of cash collateral required to be provided by the Company pursuant to Section 8 of the Credit Agreement in respect of Letters of Credit, and (B) for all other purposes of the Indenture (including

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without limitation, the determination of the amount of principal on which interest is payable and the determination of the principal amount with respect to which the Collateral Agent, as registered owner, is entitled to vote or otherwise exercise rights as registered owner), the First Mortgage Bonds, Collateral (2004) Series A shall be deemed to be “Outstanding” at any time in an aggregate principal amount equal to the Maximum Principal Amount at such time.  The “Maximum Principal Amount” on and as of the date of original issuance of the First Mortgage Bonds, Collateral (2004) Series A shall be $35,000,000 and thereafter shall be reduced from time to time upon each Revolving Credit Commitment Redemption and each Revolving Credit Event of Default Termination Commitment Redemption (as hereinafter defined), in each case, by an amount equal to the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series A that are deemed to be redeemed pursuant to such Revolving Credit Commitment Redemption or such Revolving Credit Event of Default Commitment Termination Redemption.

Interest

The unpaid principal amount of the First Mortgage Bonds, Collateral (2004) Series A, of which this bond is one, bears interest (i) with respect to the portion or amount of such principal that is equal to the principal amount of Revolving Loans, at one or more variable interest rates per annum which rate or rates for each day shall be equal to the rate or rates per annum borne by Revolving Loans in accordance with the Credit Agreement for such day (calculated in the manner provided in the Credit Agreement for the calculation of interest on Revolving Loans), payable on each day on which interest is payable on Revolving Loans in accordance with the Credit Agreement (and in an amount equal to the Revolving Credit Applicable Share of the amount of interest that is payable on Revolving Loans on such day in accordance with the Credit Agreement), (ii) with respect to the portion or amount of such principal (in excess of the amount described in the preceding clause (i)) that is equal to the Revolving Credit Applicable Share of the unused Total Revolving Credit Commitments (as defined in the Credit Agreement), at one or more variable interest rates per annum which rate or rates for any day shall be equal to the rate or rates per annum at which commitment fees are payable under the Credit Agreement on the unused Total Revolving Credit Commitments, payable on each day on which commitment fees are payable under the Credit Agreement (and in an amount equal to the Revolving Credit Applicable Share of the amount of commitment fees that is payable under the Credit Agreement on such day), and (iii) with respect to the portion or amount of such principal (in excess of the amounts described in the preceding clauses (i) and (ii)) that is equal to the Revolving Credit Applicable Share of the amount available to be drawn under Letters of Credit (as defined in the Credit Agreement), at one or more variable interest rates per annum which rate or rates for each day shall be equal to the rate or rates per annum at which letter of credit fees are payable under the Credit Agreement on the amount available to be drawn under Letters of Credit, payable on each day on which letter of credit fees are payable under the Credit Agreement (and in an amount equal to the Revolving Credit Applicable Share of the amount of letter of credit fees that is payable under the Credit Agreement on such day), in each case, to the Collateral Agent, as the registered owner, without regard to, or necessity for, any record date.

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Revolving Credit Applicable Share

As used herein, “Revolving Credit Applicable Share” means, as of any day, a fraction (expressed as a percentage rounded to the second decimal place), (i) the numerator of which is the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series A that are Outstanding on such day, and (ii) the denominator of which is the sum of (a) the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series A that are Outstanding on such day, plus (b) the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series A, due 2009, of the Company (the “Montana Revolving Credit Bonds”) that are outstanding on such day under the Company’s Montana Mortgage (as defined in the Supplemental Indenture). Simultaneously with the issuance and registration of the First Mortgage Bonds, Collateral (2004) Series A in the name of the Collateral Agent (for the same purpose), the Montana Revolving Credit Bonds were issued to the Collateral Agent to secure the Revolving Credit Obligations.

Revolving Credit Obligations and Revolving Loans

As used herein, “Revolving Credit Obligations” means the obligations of the Company (A) to pay (i) principal of and interest on (a) the Revolving Credit Loans (as defined in the Credit Agreement), (b) the Swing Line Loans (as defined in the Credit Agreement), and (c) drawings under Letters of Credit (as defined in the Credit Agreement) that are not reimbursed pursuant to and in accordance with the Credit Agreement (collectively, “Revolving Loans”), (ii) commitment fees on the average daily amount of the unused Total Revolving Credit Commitments (as defined in the Credit Agreement); and (iii) letter of credit fees on the amount available to be drawn under Letters of Credit (as defined in the Credit Agreement), and (B) to cash collateralize Letters of Credit pursuant to and in accordance with Section 8 of the Credit Agreement.

Redemption

First Mortgage Bonds, Collateral (2004) Series A, of which this bond is one, shall be subject to redemption as follows (but shall not otherwise be or become subject to redemption, whether at the option of the holders thereof or the Company or pursuant to any other requirements or provisions of the Indenture):  (A) on each day on which there is a permanent reduction or termination of the Revolving Credit Commitments (as defined in the Credit Agreement) pursuant to Section 2.10 of the Credit Agreement, First Mortgage Bonds, Collateral (2004) Series A shall be deemed to have been redeemed in an aggregate principal amount equal to the Revolving Credit Applicable Share of the amount of such permanent reduction or termination of the Revolving Credit Commitments pursuant to such Section 2.10 (a “Revolving Credit Commitment Redemption”); (B) on each day on which the Revolving Credit Commitments are permanently terminated pursuant to Section 8 of the Credit Agreement, First Mortgage Bonds, Collateral (2004) Series A shall be deemed to have been redeemed in an aggregate principal amount which, after giving effect to such termination, results in the Maximum Principal Amount of First Mortgage Bonds, Collateral (2004) Series A being equal to the Revolving Credit Applicable Share of the sum of the principal amount of the

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Revolving Loans then outstanding under the Credit Agreement and the amount then available to be drawn under Letters of Credit (a “Revolving Credit Event of Default Commitment Termination Redemption”); and (C) on each day on which the Revolving Loans are accelerated in accordance with the Credit Agreement (an “Acceleration Redemption Date”), the entire aggregate principal amount of First Mortgage Bonds, Collateral (2004) Series A shall be subject to mandatory redemption by the Company (an “Acceleration Redemption”); in each case, without any necessity for notice or call by the Company or by the Trustee (such notice and call being waived by the registered owners of the First Mortgage Bonds, Collateral (2004) Series A by the acceptance of the First Mortgage Bonds, Collateral (2004) Series A and in connection with each Redemption Demand hereinafter described); provided, however, that in the event of a reinstatement of the Revolving Credit Commitments or a rescission or annulment of the acceleration of the Revolving Loans pursuant to the Credit Agreement or otherwise, the related Revolving Credit Event of Default Commitment Termination Redemption or the related Acceleration Redemption shall be deemed to be rescinded or annulled, without prejudice to the occurrence of another Revolving Credit Event of Default Commitment Termination Redemption or another Acceleration Redemption upon and by reason of a subsequent termination of the Revolving Credit Commitments pursuant to Section 8 of the Credit Agreement or another acceleration of the Revolving Loans in accordance with the Credit Agreement.  Acceleration Redemption of First Mortgage Bonds, Collateral (2004) Series A on an Acceleration Redemption Date shall be at a redemption price equal to the principal amount (determined in accordance with the Supplemental Indenture) of the First Mortgage Bonds, Collateral (2004) Series A that is then payable by the Company (without premium), together with interest accrued on said principal to and including such Acceleration Redemption Date (collectively, an “Acceleration Redemption Amount”); and such Acceleration Redemption Amount shall be due and payable on such Acceleration Redemption Date.  In the event of any failure by the Company to pay when due an Acceleration Redemption Amount, interest shall accrue on such unpaid Acceleration Redemption Amount at the rates (and in amounts equal to the Revolving Credit Applicable Share of the amounts) of interest that accrue on the corresponding unpaid principal of and interest on the Revolving Loans in accordance with the Credit Agreement.

The Trustee may conclusively presume that no redemption of First Mortgage Bonds, Collateral (2004) Series A is deemed to have occurred or resulted in a reduction of the Maximum Principal Amount (in the case of a Revolving Credit Commitment Redemption or a Revolving Credit Event of Default Commitment Termination Redemption) or is required to occur (in the case of an Acceleration Redemption) unless and until it shall have received a written notice from the Administrative Agent, signed by a person purporting to be its duly authorized officer, stating that the Revolving Credit Commitments have been permanently reduced or terminated pursuant to Section 2.10 of the Credit Agreement or the Revolving Credit Commitments have been permanently terminated pursuant to Section 8 of the Credit Agreement or the Revolving Loans have been accelerated in accordance with the Credit Agreement (a “Redemption Demand”).  Each Redemption Demand also shall (i) state the date on which the Revolving Credit Commitments were permanently reduced or terminated pursuant to Section 2.10 of the

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Credit Agreement or the Revolving Credit Commitments were permanently terminated pursuant to Section 8 of the Credit Agreement or the Revolving Loans were accelerated, (ii) the amount by which the Revolving Credit Commitments were so permanently reduced or terminated and the Maximum Principal Amount (determined in accordance with the Supplemental Indenture) after giving effect to the related and deemed redemption of First Mortgage Bonds, Collateral (2004) Series A or the principal amount of the Revolving Loans subject to acceleration on such date, (iii) the principal amount of First Mortgage Bonds, Collateral (2004) Series A that are deemed to have been redeemed or are to be redeemed on such date in accordance with the Supplemental Indenture by reason of such permanent reduction or termination of the Revolving Credit Commitments and such reduction of the Maximum Principal Amount or such acceleration of the Revolving Loans, and (iv) in the case of an Acceleration Redemption, the Acceleration Redemption Amount payable with respect to the First Mortgage Bonds, Collateral (2004) Series A (determined in accordance with the Supplemental Indenture) and setting forth the amounts of the respective portions thereof representing principal of and interest on the First Mortgage Bonds, Collateral (2004) Series A.  Each Redemption Demand shall be deemed to constitute a written waiver by the Collateral Agent, as registered owner of all First Mortgage Bonds, Collateral (2004) Series A then Outstanding, of notice of redemption and call for redemption by the Company or the Trustee of the First Mortgage Bonds, Collateral (2004) Series A subject to redemption as described in such Redemption Demand.  The Trustee may conclusively presume the statements contained in each Redemption Demand to be correct (and the Trustee shall be fully protected in relying thereon).

The Trustee may conclusively presume that no rescission or annulment of a Revolving Credit Event of Default Commitment Termination Redemption or an Acceleration Redemption (in respect of which the Trustee has received a Redemption Demand) is required unless and until it shall have received a written notice from the Administrative Agent, signed by a person purporting to be its duly authorized officer, stating that the termination of the Revolving Credit Commitments pursuant to Section 8 of the Credit Agreement or the acceleration of the Revolving Loans has been rescinded or annulled in accordance with the Credit Agreement or otherwise (a “Rescission Notice”).  Each Rescission Notice also shall state the date on which the termination of the Revolving Credit Commitments pursuant to Section 8 of the Credit Agreement or the acceleration of the Revolving Loans was rescinded or annulled in accordance with the Credit Agreement or otherwise and, as consequence, the redemption of the First Mortgage Bonds, Collateral (2004) Series A was rescinded or annulled in accordance with the Supplemental Indenture.  The Trustee may conclusively presume the statements contained in any Rescission Notice to be correct (and the Trustee shall be fully protected in relying thereon).

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Additional Terms

First Mortgage Bonds, Collateral (2004) Series A, of which this Bond is one, shall be subject to the following other terms and conditions:

(I)            It is expressly stated (for the avoidance of any doubt) that, notwithstanding anything in this bond or in the Supplemental Indenture to the contrary (other than the provisions of subdivision III below), each payment of principal of or interest on the First Mortgage Bonds, Collateral (2004) Series A that becomes due and payable on any day (whether by reason of stated due date, acceleration, redemption or otherwise) shall correspond to, and be equal to the Revolving Credit Applicable Share of, a payment of Revolving Credit Obligations that becomes due and payable on such day in accordance with the Credit Agreement.

(II)           The obligation of the Company to make each payment of principal of or interest on the First Mortgage Bonds, Collateral (2004) Series A that becomes due and payable in accordance with the Supplemental Indenture (A) shall be fully satisfied and discharged if the corresponding payment of the Revolving Credit Obligations shall have been fully paid under and in accordance with the Credit Agreement, and (B) shall be partially satisfied and discharged if the corresponding payment of the Revolving Credit Obligations shall have been partially paid under and in accordance with the Credit Agreement (such partial satisfaction and discharge with respect to the First Mortgage Bonds, Collateral (2004) Series A to be in an amount equal to the Revolving Credit Applicable Share of the amount of such partial payment with respect to the Revolving Credit Obligations).

(III)         Nothing in any of the First Mortgage Bonds, Collateral (2004) Series A (including, without limitation, any reference to the principal payable with respect to the First Mortgage Bonds, Collateral (2004) Series A being determined on the basis of the Revolving Credit Applicable Share of the principal payable with respect to the Revolving Credit Obligations) shall, or shall be deemed or construed to, increase the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series A that are Outstanding at any time to an amount in excess of the Maximum Principal Amount as in effect at such time.

Transfer Restrictions

First Mortgage Bonds, Collateral (2004) Series A, of which this Bond is one, shall not be transferable except to any successor Collateral Agent under the Collateral Agreement.  As a condition precedent to any transfer of the First Mortgage Bonds, Collateral (2004) Series A by the Collateral Agent, the Collateral Agent shall submit to the Company, the Trustee and the Bond Registrar (in addition to all other documents and instruments required to be submitted to the Bond Registrar pursuant to the Indenture) a certificate of the Collateral Agent, signed by a person purporting to be its duly authorized officer, certifying that the transferee in such transfer is a successor Collateral Agent under the Collateral Agreement (and the Trustee and the Bond Registrar may conclusively presume the statements in any such certificate of the Collateral Agent to be correct).

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Any transfer of First Mortgage Bonds, Collateral (2004) Series A (i) shall be subject to the provisions of Section 3.05 of the Indenture, except that the provisions of paragraph (g) of such Section 3.05 shall not be applicable to any transfer of First Mortgage Bonds, Collateral (2004) Series A to a successor Collateral Agent under the Collateral Agreement, and (ii) shall be made at the office or agency of the Company in the Borough of Manhattan, The City of New York.

The Company has waived any right to make any charge for any exchange or transfer of First Mortgage Bonds, Collateral (2004) Series A by the Collateral Agent, whether to reimburse itself for any tax or taxes or other governmental charge or otherwise (it being understood that the Company shall pay any tax or taxes or governmental or other charge which may be payable by reason of any exchange or transfer of First Mortgage Bonds, Collateral (2004) Series A by the Collateral Agent).

General

To the extent permitted by, and as provided in, the Indenture, modifications or alterations of the Indenture, or of any indenture supplemental thereto, and of the rights and obligations of the Company and of the holders of the Bonds may be made with the consent of the Company by an affirmative vote of the holders of a majority in aggregate principal amount of the Bonds entitled to vote then Outstanding, at a meeting of the holders of the Bonds called and held as provided in the Indenture, and by an affirmative vote of the holders of a majority in aggregate principal amount of the Bonds of any series or any tranche or tranches of any series entitled to vote then Outstanding and affected by such modification or alteration, in case one or more but less than all of the series of Bonds or of any tranche or tranches of any series of Bonds then Outstanding under the Indenture are so affected; provided, however, that no such modification or alteration shall be made which will affect the terms of payment of the principal of, or interest or premium, if any, on this Bond.

In case an Event of Default, as defined in the Indenture, shall occur, the principal of all the First Mortgage Bonds, Collateral (2004) Series A at any such time Outstanding under the Indenture may be declared or may become due and payable, upon the conditions and in the manner and with the effect provided in the Indenture. The Indenture provides that such declaration may be rescinded under certain circumstances.

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Exhibit B
to
Supplemental Indenture

Form of Bond of the First Mortgage Bonds, Collateral (2004) Series B

Exhibit B

[FORM OF BOND OF FIRST MORTGAGE BONDS, COLLATERAL (2004) SERIES B, DUE 2011]

THIS BOND IS NOT TRANSFERABLE EXCEPT TO A SUCCESSOR COLLATERAL AGENT UNDER THE COLLATERAL AGREEMENT (AS IDENTIFIED AND DEFINED BELOW).

NORTHWESTERN CORPORATION
(Incorporated under the laws of the State of Delaware)
FIRST MORTGAGE BOND, COLLATERAL (2004) SERIES B, DUE 2011

No. R- $                       

NorthWestern Corporation, a corporation organized and existing under the laws of the State of Delaware (the “Company”, which term shall include any successor corporation as defined in the Indenture hereinafter referred to), for value received, hereby promises to pay to Lehman Commercial Paper Inc., as collateral agent under the Bond Delivery and Collateral Agreement to which reference is hereinafter made, or (subject to the transfer restrictions hereinbefore and hereinafter described) registered assigns, the sum of                              dollars, in installments prior to, and the balance on, the first day of November, 2011 (the “Term Loan Maturity Date”), in each case, in such amount as is described on the reverse hereof for such installment or such balance, as applicable, and in any coin or currency of the United States of America which at the time of payment is legal tender for public and private debts, and to pay interest thereon as described on the reverse hereof in like coin or currency.

The Bonds of the series of which this Bond is one have been issued to Lehman Commercial Paper Inc., as collateral agent (together with its successors in such capacity, the “Collateral Agent”) under the Bond Delivery and Collateral Agreement, dated as of the date set forth on the reverse hereof (as amended or otherwise modified, or as waived, or as replaced, in each case, from time to time in accordance with its terms, the “Collateral Agreement”), between the Company and the Collateral Agent, to secure the obligations of the Company to pay when due the Term Loan Applicable Share (as hereinafter defined) of the principal of and interest on the term loans (the “Term Loans”) made and outstanding under the Credit Agreement, dated as of the date set forth on the reverse hereof (as amended or otherwise modified, or as waived, or as replaced, in each case, from time to time in accordance with its terms, the “Credit Agreement”), among the Company, as borrower, the several lenders from time to time parties thereto (the “Lenders”), Lehman Brothers Inc. and Deutsche Bank Securities Inc., as joint lead arrangers and joint bookrunners, Deutsche Bank Securities Inc., as syndication agent, Union Bank of California, N.A. and KeyBank National Association, as co-documentation agents, Lehman Commercial Paper Inc., as administrative agent (together with its successors in such capacity, the “Administrative Agent”) and the Collateral Agent.

This Bond shall not be entitled to any benefit under the Indenture or any indenture supplemental thereto, or become valid or obligatory for any purpose, until the form of certificate endorsed herein shall have been signed by or on behalf of JPMorgan Chase Bank, the Trustee under the Indenture, or a successor trustee thereto under the Indenture, or by an authenticating agent duly appointed by the Trustee in accordance with the terms of the Indenture.

The provisions of this Bond are continued on the reverse hereof and such continued provisions shall for all purposes have the same effect as though fully set forth at this place.

IN WITNESS WHEREOF, NorthWestern Corporation has caused this Bond to be signed (manually or by facsimile signature) in its name by an Authorized Executive Officer, as defined in the Indenture, and its corporate seal (or a facsimile thereof) to be hereto affixed and attested (manually or by facsimile signature) by an Authorized Executive Officer, as defined in the Indenture.

Dated:		NORTHWESTERN CORPORATION
		By
			Authorized Executive Officer
ATTEST:
By
	Authorized Executive Officer

[FORM OF TRUSTEE’S CERTIFICATE OF AUTHENTICATION]

This is one of the Bonds of the series designated therein referred to in the within-mentioned Indenture and Supplemental Indenture dated as of November 1, 2004.

JPMORGAN CHASE BANK, AS TRUSTEE
By
	Authorized Officer

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[FORM OF REVERSE OF BOND]

Indenture and Series Designation

This Bond is one of a duly authorized issue of bonds of the Company (the “Bonds”), of the series hereinafter specified, all issued and to be issued under and equally secured by a General Mortgage Indenture and Deed of Trust (the “Indenture”), dated as of August 1, 1993, executed by the Company (under its then name, NorthWestern Public Service Company) to The Chase Manhattan Bank (National Association), the predecessor to JPMorgan Chase Bank (the “Trustee”), as Trustee, to which Indenture and all indentures supplemental thereto reference is hereby made for a description of the properties mortgaged and pledged, the nature and extent of the security, the rights of registered owners of the Bonds and of the Trustee in respect thereof, and the terms and conditions upon which the Bonds are, and are to be, secured (and for the definition of any capitalized term used herein but not defined herein (with any term defined herein and in the Indenture being used herein as defined herein)).  The Bonds may be issued in series, for various principal sums, may mature at different times, may bear interest at different rates and may otherwise vary as provided in the Indenture.  This Bond is one of a series designated as the “First Mortgage Bonds, Collateral (2004) Series B, due 2011” (the “First Mortgage Bonds, Collateral (2004) Series B”) of the Company issued under and secured by the Indenture and described in the supplemental indenture dated as of November 1, 2004 (the “Supplemental Indenture”) between the Company and the Trustee, supplemental to the Indenture.

Issuance to Collateral Agent under Collateral Agreement

The First Mortgage Bonds, Collateral (2004) Series B have been issued to the Collateral Agent under the Collateral Agreement to secure the obligations of the Company to pay when due the Term Loan Applicable Share (as hereinafter defined) of the principal of and interest on the Term Loans made and outstanding under the Credit Agreement.  Each of the Collateral Agreement and the Credit Agreement is dated as of November 1, 2004.

Principal

Principal of the First Mortgage Bonds, Collateral (2004) Series B, of which this Bond is one, is scheduled to be paid as follows:  (i) an installment of the principal of the First Mortgage Bonds, Collateral (2004) Series B in an amount equal to $70,000 (said amount representing one quarter of one percent (0.25%) of the original aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series B) to be payable on each March 31, June 30, September 30 and December 31, commencing March 31, 2005 and continuing through and including September 30, 2010, (ii) an installment of the principal amount of the First Mortgage Bonds, Collateral (2004) Series B in an amount equal to $6,580,000 (said amount representing twenty-three and one-half percent (23.5%) of the original aggregate principal amount of the First Mortgage Bonds, Collateral (2004)

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Series B) to be payable on December 31, 2010, March 31, 2011 and June 30, 2011, and (iii) the balance of the principal of the First Mortgage Bonds, Collateral (2004) Series B to be payable on the Term Loan Maturity Date; in each case, unless an equal installment or balance of the principal of the Term Loans is not due and payable on such day or on the Term Loan Maturity Date, as applicable, in accordance with the Credit Agreement by reason of prior prepayment of the Term Loans (in which event, there shall be due and payable on the First Mortgage Bonds, Collateral (2004) Series B on such day or on the Term Loan Maturity Date, as applicable, an amount of principal of said Bonds equal to the Term Loan Applicable Share of the amount of principal of the Term Loans that is payable on such day or on the Term Loan Maturity Date, as applicable, in accordance with the Credit Agreement).

Interest

The unpaid principal amount of the First Mortgage Bonds, Collateral (2004) Series B, of which this Bond is one, bears interest at one or more variable interest rates per annum which rate or rates for each day shall be equal to the rate or rates per annum borne by the Term Loans in accordance with the Credit Agreement for such day (calculated in the manner provided in the Credit Agreement for the calculation of interest on the Term Loans), payable on each day on which interest is payable on the Term Loans in accordance with the Credit Agreement (and in an amount equal to the Term Loan Applicable Share of the amount of interest that is payable on the Term Loans on such day in accordance with the Credit Agreement) to the Collateral Agent, as the registered owner, without regard to, or necessity for, any record date.

Term Loan Applicable Share

As used herein, “Term Loan Applicable Share” means, as of any day, a fraction (expressed as a percentage rounded to the second decimal place), (i) the numerator of which is the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series B that are Outstanding on such day, and (ii) the denominator of which is the sum of (a) the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series B that are Outstanding on such day, plus (b) the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series B, due 2011, of the Company (the “Montana Term Loan Bonds”) that are outstanding on such day under the Montana Mortgage.  Simultaneously with the issuance and registration of the First Mortgage Bonds, Collateral (2004) Series B in the name of the Collateral Agent (for the same purpose), the Montana Term Loan Bonds were issued to the Collateral Agent to secure the obligations of the Company to pay when due a portion of the principal of and interest on the Term Loans.

Redemption

First Mortgage Bonds, Collateral (2004) Series B, of which this Bond is one, shall be subject to redemption as follows (but shall not otherwise be or become subject to

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redemption, whether at the option of the holders thereof or the Company or pursuant to any other requirements or provisions of the Indenture):  (A) on each day on which the Term Loans are prepaid in accordance with the Credit Agreement, First Mortgage Bonds, Collateral (2004) Series B shall be deemed to have been redeemed in an aggregate principal amount equal to the Term Loan Applicable Share of the aggregate principal amount of the Term Loans that are so prepaid on such day (a “Term Loan Prepayment Redemption”); and (B) on each day on which the Term Loans are accelerated in accordance with the Credit Agreement (an “Acceleration Redemption Date”), the entire aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series B shall be subject to mandatory redemption by the Company (the “Acceleration Redemption”); in each case, without any necessity for notice or call by the Company or by the Trustee (such notice and call being waived by the registered owners of the First Mortgage Bonds, Collateral (2004) Series B by the acceptance of the First Mortgage Bonds, Collateral (2004) Series B and in connection with each Redemption Demand hereinafter described); provided, however, that in the event of a rescission or annulment of the acceleration of the Term Loans pursuant to the Credit Agreement or otherwise, the related Acceleration Redemption shall be deemed to be rescinded or annulled (without prejudice to the occurrence of another Acceleration Redemption upon and by reason of a subsequent acceleration of the Term Loans in accordance with the Credit Agreement).  Acceleration Redemption of First Mortgage Bonds, Collateral (2004) Series B on an Acceleration Redemption Date shall be at a redemption price equal to the principal amount of the First Mortgage Bonds, Collateral (2004) Series B (without premium), together with interest accrued on said principal to and including such Acceleration Redemption Date (collectively, an “Acceleration Redemption Amount”); and such Acceleration Redemption Amount shall be due and payable on the First Mortgage Bonds, Collateral (2004) Series B on such Acceleration Redemption Date.  In the event of any failure by the Company to pay when due the Acceleration Redemption Amount with respect to an Acceleration Redemption of First Mortgage Bonds, Collateral (2004) Series B, interest shall accrue on such unpaid Acceleration Redemption Amount at the rates (and in amounts equal to the Term Loan Applicable Share of the amounts) of interest that accrue on the corresponding unpaid principal of and interest on the Term Loans in accordance with the Credit Agreement.

The Trustee may conclusively presume that no redemption of First Mortgage Bonds, Collateral (2004) Series B is deemed to have occurred (in the case of a Term Loan Prepayment Redemption) or is required (in the case of an Acceleration Redemption) unless and until it shall have received a written notice from the Administrative Agent, signed by a person purporting to be its duly authorized officer, stating that Term Loans have been prepaid or have been accelerated, in either case, in accordance with the Credit Agreement (a “Redemption Demand”).  Each Redemption Demand also shall state (i) the date on which the Term Loans were prepaid or accelerated in accordance with the Credit Agreement, (ii) the principal amount of the Term Loans so prepaid or accelerated on such date, (iii) the principal amount of First Mortgage Bonds, Collateral (2004) Series B that are deemed to have been redeemed or are to be redeemed

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on such date in accordance with the Supplemental Indenture by reason of such prepayment or acceleration, and (iv)  in the case of an Acceleration Redemption, the Acceleration Redemption Amount payable with respect to the First Mortgage Bonds, Collateral (2004) Series B (determined in accordance with the Supplemental Indenture) and setting forth the amounts of the respective portions thereof representing principal of and interest on the First Mortgage Bonds, Collateral (2004) Series B.  Each Redemption Demand shall be deemed to constitute a written waiver by the Collateral Agent, as registered owner of all First Mortgage Bonds, Collateral (2004) Series B then Outstanding, of notice of redemption and call for redemption by the Company or the Trustee of the First Mortgage Bonds, Collateral (2004) Series B deemed redeemed or subject to redemption as described in such Redemption Demand.  The Trustee may conclusively presume the statements contained in each Redemption Demand to be correct (and the Trustee shall be fully protected in relying thereon).

The Trustee may conclusively presume that no rescission or annulment of the Acceleration Redemption (in respect of which the Trustee has received a Redemption Demand) is required unless and until it shall have received a written notice from the Administrative Agent, signed by a person purporting to be its duly authorized officer, stating that the acceleration of the Term Loans has been rescinded or annulled in accordance with the Credit Agreement or otherwise (a “Rescission Notice”).  Each Rescission Notice also shall state the date on which the acceleration of the Term Loans was rescinded or annulled in accordance with the Credit Agreement or otherwise and, as consequence, the redemption of the First Mortgage Bonds, Collateral (2004) Series B was rescinded or annulled in accordance with the Supplemental Indenture.  The Trustee may conclusively presume the statements contained in any Rescission Notice to be correct (and the Trustee shall be fully protected in relying thereon).

Additional Terms

First Mortgage Bonds, Collateral (2004) Series B, of which this Bond is one, shall be subject to the following other terms and conditions:

(I)            It is expressly stated (for the avoidance of any doubt) that, notwithstanding anything in this bond or the Supplemental Indenture to the contrary (other than the provisions of subdivision III below), each payment of principal of or interest on the First Mortgage Bonds, Collateral (2004) Series B that becomes due and payable on any day (whether by reason of stated due date, acceleration, redemption or otherwise) shall correspond to, and be equal to, the Term Loan Applicable Share of, a payment of principal of or interest on the Term Loans that becomes due and payable on such day in accordance with the Credit Agreement.

(II)           The obligation of the Company to make each payment of principal of or interest on the First Mortgage Bonds, Collateral (2004) Series B that becomes due and payable in accordance with the Supplemental Indenture (A) shall be fully satisfied and discharged if the corresponding payment of the principal of or interest on the Term Loans

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shall have been fully paid under and in accordance with the Credit Agreement, and (B) shall be partially satisfied and discharged if the corresponding payment of the principal of or interest on the Term Loans shall have been partially paid under and in accordance with the Credit Agreement (such partial satisfaction and discharge with respect to the First Mortgage Bonds, Collateral (2004) Series B to be in an amount equal to the Term Loan Applicable Share of the amount of such partial payment with respect to the Term Loans).

(III)         Nothing in any of First Mortgage Bonds, Collateral (2004) Series B (including, without limitation, any reference to the principal payable with respect to the First Mortgage Bonds, Collateral (2004) Series B being determined on the basis of the Term Loan Applicable Share of the principal payable with respect to the Term Loans) shall, or shall be deemed or construed to, (A) increase the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series B that are Outstanding from time to time, (B) cause or permit an amount of principal of the First Mortgage Bonds, Collateral (2004) Series B to be or to become due and payable which, when added to all other principal of such Bonds theretofore paid, exceeds $28,000,000, or (C) cause or permit to be or to become due and payable interest on the First Mortgage Bonds, Collateral (2004) Series B which is payable on any principal of the First Mortgage Bonds, Collateral (2004) Series B that is in excess of the principal of the First Mortgage Bonds, Collateral (2004) Series B as restricted pursuant to the preceding clauses (A) and (B).

Transfer Restrictions

First Mortgage Bonds, Collateral (2004) Series B, of which this Bond is one, shall not be transferable except to any successor Collateral Agent under the Collateral Agreement.  As a condition precedent to any transfer of the First Mortgage Bonds, Collateral (2004) Series B by the Collateral Agent, the Collateral Agent shall submit to the Company, the Trustee and the Bond Registrar (in addition to all other documents and instruments required to be submitted to the Bond Registrar pursuant to the Indenture) a certificate of the Collateral Agent, signed by a person purporting to be its duly authorized officer, certifying that the transferee in such transfer is a successor Collateral Agent under the Collateral Agreement (and the Trustee and the Bond Registrar may conclusively presume the statements in any such certificate of the Collateral Agent to be correct).

Any transfer of First Mortgage Bonds, Collateral (2004) Series B (i) shall be subject to the provisions of Section 3.05 of the Indenture, except that the provisions of paragraph (g) of such Section 3.05 shall not be applicable to any transfer of First Mortgage Bonds, Collateral (2004) Series B to a successor Collateral Agent under the Collateral Agreement, and (ii) shall be made at the office or agency of the Company in the Borough of Manhattan, The City of New York.

The Company has waived any right to make any charge for any exchange or transfer of First Mortgage Bonds, Collateral (2004) Series B by the Collateral Agent, whether to reimburse itself for any tax or taxes or other governmental charge or otherwise

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(it being understood that the Company shall pay any tax or taxes or governmental or other charge which may be payable by reason of any exchange or transfer of First Mortgage Bonds, Collateral (2004) Series B by the Collateral Agent).

General

To the extent permitted by, and as provided in, the Indenture, modifications or alterations of the Indenture, or of any indenture supplemental thereto, and of the rights and obligations of the Company and of the holders of the Bonds may be made with the consent of the Company by an affirmative vote of the holders of a majority in aggregate principal amount of the Bonds entitled to vote then Outstanding, at a meeting of the holders of the Bonds called and held as provided in the Indenture, and by an affirmative vote of the holders of a majority in aggregate principal amount of the Bonds of any series or any tranche or tranches of any series entitled to vote then Outstanding and affected by such modification or alteration, in case one or more but less than all of the series of Bonds or of any tranche or tranches of any series of Bonds then Outstanding under the Indenture are so affected; provided, however, that no such modification or alteration shall be made which will affect the terms of payment of the principal of, or interest or premium, if any, on this Bond.

In case an Event of Default, as defined in the Indenture, shall occur, the principal of all the First Mortgage Bonds, Collateral (2004) Series B at any such time Outstanding under the Indenture may be declared or may become due and payable, upon the conditions and in the manner and with the effect provided in the Indenture. The Indenture provides that such declaration may be rescinded under certain circumstances.

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Exhibit C
to
Supplemental Indenture

Form of Bond of the First Mortgage Bonds, Collateral (2004) Series C

Exhibit C

[FORM OF BOND OF FIRST MORTGAGE BONDS, COLLATERAL (2004) SERIES C, DUE 2014]

THIS BOND IS NOT TRANSFERABLE EXCEPT TO A SUCCESSOR TRUSTEE
UNDER THE SENIOR NOTE INDENTURE (AS IDENTIFIED AND DEFINED BELOW).

NORTHWESTERN CORPORATION
(Incorporated under the laws of the State of Delaware)
FIRST MORTGAGE BOND, COLLATERAL (2004) SERIES C, DUE 2014

No. R- $                    

NorthWestern Corporation, a corporation organized and existing under the laws of the State of Delaware (the “Company”, which term shall include any successor corporation as defined in the Indenture hereinafter referred to), for value received, hereby promises to pay to U.S. Bank National Association, as trustee under the Senior Note Indenture to which reference is hereinafter made, or (subject to the transfer restrictions hereinbefore and hereinafter described) registered assigns, the sum of                                dollars, on the first day of November, 2014 (the “Senior Note Maturity Date”), in any coin or currency of the United States of America which at the time of payment is legal tender for public and private debts, and to pay interest thereon as described on the reverse hereof in like coin or currency.

The Bonds of the series of which this Bond is one have been issued to U.S. Bank National Association, as trustee (together with its successors in such capacity, the “Senior Note Trustee”) under the Indenture, dated as of November 1, 2004, between the Company and the Senior Note Trustee, as supplemented and amended by Supplemental Indenture No. 1, dated as of November 1, 2004 (as so supplemented and amended and as may be further supplemented, amended or otherwise modified in accordance with its terms, the “Senior Note Indenture”), to be owned and held by the Senior Note Trustee under the terms of the Senior Note Indenture as security for the payment of the principal of, premium (if any) and interest on the Senior Notes (as such term is hereinafter defined).

This Bond shall not be entitled to any benefit under the Indenture or any indenture supplemental thereto, or become valid or obligatory for any purpose, until the form of certificate endorsed herein shall have been signed by or on behalf of JPMorgan Chase Bank, the Trustee under the Indenture, or a successor trustee thereto under the Indenture, or by an authenticating agent duly appointed by the Trustee in accordance with the terms of the Indenture.

The provisions of this Bond are continued on the reverse hereof and such continued provisions shall for all purposes have the same effect as though fully set forth at this place.

IN WITNESS WHEREOF, NorthWestern Corporation has caused this Bond to be signed (manually or by facsimile signature) in its name by an Authorized Executive Officer, as defined in the Indenture, and its corporate seal (or a facsimile thereof) to be hereto affixed and attested (manually or by facsimile signature) by an Authorized Executive Officer, as defined in the Indenture.

Dated:		NORTHWESTERN CORPORATION
		By
			Authorized Executive Officer
ATTEST:
By
	Authorized Executive Officer

[FORM OF TRUSTEE’S CERTIFICATE OF AUTHENTICATION]

This is one of the Bonds of the series designated therein referred to in the within-mentioned Indenture and Supplemental Indenture dated as of November 1, 2004.

JPMORGAN CHASE BANK, AS TRUSTEE
By
	Authorized Officer

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[FORM OF REVERSE OF BOND]

Indenture and Series Designation

This Bond is one of a duly authorized issue of bonds of the Company (the “Bonds”), of the series hereinafter specified, all issued and to be issued under and equally secured by a General Mortgage Indenture and Deed of Trust (the “Indenture”), dated as of August 1, 1993, executed by the Company (under its then name, NorthWestern Public Service Company) to The Chase Manhattan Bank (National Association), the predecessor to JPMorgan Chase Bank (the “Trustee”), as Trustee, to which Indenture and all indentures supplemental thereto reference is hereby made for a description of the properties mortgaged and pledged, the nature and extent of the security, the rights of registered owners of the Bonds and of the Trustee in respect thereof, and the terms and conditions upon which the Bonds are, and are to be, secured (and for the definition of any capitalized term used herein but not defined herein (with any term defined herein and in the Indenture being used herein as defined herein)).  The Bonds may be issued in series, for various principal sums, may mature at different times, may bear interest at different rates and may otherwise vary as provided in the Indenture.  This Bond is one of a series designated as the “First Mortgage Bonds, Collateral (2004) Series C, due 2014” (the “First Mortgage Bonds, Collateral (2004) Series C”) of the Company issued under and secured by the Indenture and described in the supplemental indenture dated as of November 1, 2004 (the “Supplemental Indenture”) between the Company and the Trustee, supplemental to the Indenture.

Principal

The unpaid principal of the First Mortgage Bonds, Collateral (2004) Series C, of which this Bond is one, is scheduled to be paid on the Senior Notes Maturity Date.

Interest

The unpaid principal amount of the First Mortgage Bonds, Collateral (2004) Series C, of which this Bond is one, bears interest at the rate of five and seven eighth (5.875%) per annum (calculated in the same manner as interest is calculated on the Senior Notes in accordance with the Senior Note Indenture), payable semiannually on the first (1st) day of each May and November, commencing on May 1, 2005 and continuing until the principal of the First Mortgage Bonds, Collateral (2004) Series C Series is paid (or provided for in accordance with the Senior Note Indenture), to the Senior Note Trustee as the registered owner, without regard to, or necessity for, any record date.

Senior Notes Applicable Share

As used herein, “Senior Notes Applicable Share” means, as of any day, a fraction (expressed as a percentage rounded to the eighth decimal place), (i) the numerator of which is the aggregate principal amount of the First Mortgage Bonds, Collateral (2004)

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Series C that are Outstanding on such day, and (ii) the denominator of which is the sum of (a) the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series C that are Outstanding on such day, plus (b) the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series C, due 2014, of the Company (the “Montana Senior Notes Bonds”) that are outstanding on such day under the Company’s Montana Mortgage (as defined in the Supplemental Indenture).  Simultaneously with issuance and registration of the First Mortgage Bonds, Collateral (2004) Series C in the name of the Senior Note Trustee (for the same purpose), the Montana Senior Notes Bonds were issued to and registered in the name of the Senior Note Trustee, to be owned and held by the Senior Note Trustee under the terms of the Senior Note Indenture as security for the payment of the principal of, premium (if any) and interest on the Senior Notes.

Redemption

First Mortgage Bonds, Collateral (2004) Series C, of which this Bond is one, shall be subject to redemption as follows (but shall not otherwise be or become subject to redemption, whether at the option of the holders thereof or the Company or pursuant to any other requirements or provisions of the Indenture):  (A) on each day on which Senior Notes become due and payable in accordance with Section 405 of the Senior Note Indenture by reason of redemption in accordance with the Senior Note Indenture (a “Senior Notes Redemption Payment Date”), First Mortgage Bonds, Collateral (2004) Series C shall be subject to mandatory redemption by the Company in an aggregate principal amount equal to the Senior Notes Applicable Share of the aggregate principal amount of the Senior Notes that become so due and payable on such Senior Notes Redemption Payment Date (a “Corresponding Redemption”); and (B) on each day on which the Senior Notes become due and payable in accordance with Section 702 of the Senior Note Indenture by reason of acceleration of the Senior Notes in accordance with the Senior Note Indenture (a “Senior Notes Acceleration Payment Date”), the entire aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series C shall be subject to mandatory redemption by the Company (an “Acceleration Redemption”); in each case, without any necessity for notice or call by the Company or by the Trustee (such notice and call being waived by the registered owners of the First Mortgage Bonds, Collateral (2004) Series C by the acceptance of the First Mortgage Bonds, Collateral (2004) Series C and in connection with each Redemption Demand hereinafter described); provided, however, that in the event of a rescission or annulment of the acceleration of the Senior Notes pursuant to the Senior Note Indenture, the related Acceleration Redemption shall be deemed to be rescinded or annulled (without prejudice to the occurrence of another Acceleration Redemption upon and by reason of a subsequent acceleration of the Senior Notes in accordance with the Senior Note Indenture).

Each Corresponding Redemption of First Mortgage Bonds, Collateral (2004) Series C on a Senior Notes Redemption Payment Date shall be at a redemption price equal to the redemption price payable in connection with the redemption of Senior Notes to which it corresponds (consisting of principal of and, if applicable to such redemption of Senior Notes

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in accordance with the Senior Note Indenture, premium on such Senior Notes), together with interest accrued on the principal included in such redemption price to such Senior Notes Redemption Payment Date (a “Corresponding Redemption Amount”); and such Corresponding Redemption Amount shall be due and payable on such Senior Notes Redemption Payment Date.  Each Acceleration Redemption of First Mortgage Bonds, Collateral (2004) Series C on a Senior Notes Acceleration Payment Date shall be at a redemption price equal to the principal amount of the First Mortgage Bonds, Collateral (2004) Series C (without premium), together with interest accrued on said principal to such Senior Notes Acceleration Payment Date (an “Acceleration Redemption Amount”); and such Acceleration Redemption Amount shall be due and payable on such Senior Notes Acceleration Payment Date.  In the event of any failure by the Company to pay when due the Corresponding Redemption Amount with respect to a Corresponding Redemption of First Mortgage Bonds, Collateral (2004) Series C or the Acceleration Redemption Amount with respect to an Acceleration Redemption of First Mortgage Bonds, Collateral (2004) Series C, interest shall accrue on such unpaid Corresponding Redemption Amount or such unpaid Acceleration Redemption Amount at the rates (and in amounts equal to the Senior Notes Applicable Share of the amounts) of interest that accrue on the corresponding unpaid principal of, premium (if any) and interest on the Senior Notes in accordance with the Senior Note Indenture.

The Trustee may conclusively presume that no redemption of the First Mortgage Bonds, Collateral (2004) Series C is required unless and until it shall have received a written notice from the Senior Note Trustee, signed by a person purporting to be its duly authorized officer, stating that Senior Notes became due and payable pursuant to Section 405 or 702 of the Senior Note Indenture by reason of redemption or acceleration in accordance with the Senior Note Indenture (a “Redemption Demand”).  Each Redemption Demand also shall state (i) the date on which Senior Notes became due and payable by reason of redemption or acceleration in accordance with the Senior Note Indenture, (ii) the principal amount of the Senior Notes that became so due and payable on such date, (iii) the principal amount of the First Mortgage Bonds, Collateral (2004) Series C to be redeemed on such date in accordance with the Supplemental Indenture by reason of such redemption or acceleration, and (iv) the Corresponding Redemption Amount or the Acceleration Redemption Amount payable on such date with respect to First Mortgage Bonds, Collateral (2004) Series C (determined in accordance with the Supplemental Indenture) and setting forth the amounts of the respective portions thereof representing principal of, premium (if any) and interest on the First Mortgage Bonds, Collateral (2004) Series C.  Each Redemption Demand shall be deemed to constitute a waiver by the Senior Note Trustee, as registered owner of all First Mortgage Bonds, Collateral (2004) Series C then Outstanding, of notice of redemption and call for redemption by the Company or the Trustee of the First Mortgage Bonds, Collateral (2004) Series C subject to redemption as described in such Redemption Demand.  The Trustee may conclusively presume the statements contained in each Redemption Demand to be correct (and the Trustee shall be fully protected in relying thereon).

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The Trustee may conclusively presume that no rescission or annulment of an Acceleration Redemption (in respect of which the Trustee has received a Redemption Demand) is required unless and until it shall have received a written notice from the Senior Note Trustee, signed by a person purporting to be its duly authorized officer, stating that the acceleration of the Senior Notes has been rescinded or annulled in accordance with the Senior Note Indenture (a “Rescission Notice”).  Each Rescission Notice also shall state the date on which the acceleration of the Senior Notes was rescinded or annulled in accordance with the Senior Note Indenture and, as consequence, the acceleration of the First Mortgage Bonds, Collateral (2004) Series C was rescinded or annulled in accordance with the Supplemental Indenture.  The Trustee may conclusively presume the statements contained in any Rescission Notice to be correct (and the Trustee shall be fully protected in relying thereon).

Additional Terms

First Mortgage Bonds, Collateral (2004) Series C, of which this Bond is one, shall be subject to the following other terms and conditions:

(I)            It is expressly stated (for the avoidance of any doubt) that, notwithstanding anything in this Bond or the Supplemental Indenture to the contrary (other than the provisions of subdivision (III) below), each payment of principal of, premium (if any) or interest on the First Mortgage Bonds, Collateral (2004) Series C that becomes due and payable on any day (whether by reason of stated due date, acceleration, redemption or otherwise) shall correspond to, and be equal to, the Senior Notes Applicable Share of, a payment of principal of, premium (if any) or interest on the Senior Notes that becomes due and payable on such day in accordance with the Senior Note Indenture.

(II)           The obligation of the Company to make each payment of principal of, premium (if any) or interest on the First Mortgage Bonds, Collateral (2004) Series C that becomes due and payable in accordance with the Supplemental Indenture (A) shall be fully satisfied and discharged if the corresponding payment of the principal of, premium (if any) or interest on the Senior Notes shall have been fully paid, or if provision for the full payment thereof shall been made (by depositing moneys sufficient for such full payment with the Senior Note Trustee), in either case under and in accordance with the Senior Note Indenture, and (B) shall be partially satisfied and discharged if the corresponding payment of the principal of, premium (if any) or interest on the Senior Notes shall have been partially paid, or if provision for the partial payment thereof shall have been made (by depositing moneys sufficient for such partial payment with the Senior Note Trustee), in either case, under and in accordance with the Senior Note Indenture (such partial satisfaction and discharge with respect to the First Mortgage Bonds, Collateral (2004) Series C to be in an amount equal to the Senior Notes Applicable Share of the amount of such partial payment or provision for partial payment with respect to the Senior Notes).

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(III)         Nothing in any of First Mortgage Bonds, Collateral (2004) Series C (including, without limitation, any reference to the principal payable with respect to the First Mortgage Bonds, Collateral (2004) Series C being determined on the basis of the Senior Notes Applicable Share of the principal payable with respect to the Senior Notes) shall, or shall be deemed or construed to, (A) increase the aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series C that are Outstanding from time to time, (B) cause or permit an amount of principal of the First Mortgage Bonds, Collateral (2004) Series C to be or to become due and payable which, when added to all other principal of such Bonds theretofore paid, exceeds $64,000,000, or (C) cause or permit to be or to become due and payable interest on the First Mortgage Bonds, Collateral (2004) Series C which is payable on any principal of the First Mortgage Bonds, Collateral (2004) Series C that is in excess of the principal of the First Mortgage Bonds, Collateral (2004) Series C as restricted pursuant to the preceding clauses (A) and (B).

Transfer Restrictions

First Mortgage Bonds, Collateral (2004) Series C, of which this Bond is one, shall not be transferable except to any successor Senior Note Trustee under the Senior Note Indenture.  As a condition precedent to any transfer of the First Mortgage Bonds, Collateral (2004) Series C by the Senior Note Trustee, the Senior Note Trustee shall submit to the Company, the Trustee and the Bond Registrar (in addition to all other documents and instruments required to be submitted to the Bond Registrar pursuant to the Indenture) a certificate of the Senior Note Trustee, signed by a person purporting to be its duly authorized officer, certifying that the transferee in such transfer is a successor Senior Note Trustee under the Senior Note Indenture (and the Trustee and the Bond Registrar may conclusively presume the statements in any such certificate of the Senior Note Trustee to be correct).

Any transfer of First Mortgage Bonds, Collateral (2004) Series C (i) shall be subject to the provisions of Section 3.05 of the Indenture, except that the provisions of paragraph (g) of such Section 3.05 shall not be applicable to any transfer of First Mortgage Bonds, Collateral (2004) Series C to a successor Senior Note Trustee under the Senior Note Indenture, and (ii) shall be made at the office or agency of the Company in the Borough of Manhattan, The City of New York.

The Company has waived any right to make any charge for any exchange or transfer of First Mortgage Bonds, Collateral (2004) Series C by the Senior Note Trustee, whether to reimburse itself for any tax or taxes or other governmental charge or otherwise (it being understood that the Company shall pay any tax or taxes or governmental or other charge which may be payable by reason of any exchange or transfer of First Mortgage Bonds, Collateral (2004) Series C by the Senior Note Trustee).

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General

To the extent permitted by, and as provided in, the Indenture, modifications or alterations of the Indenture, or of any indenture supplemental thereto, and of the rights and obligations of the Company and of the holders of the Bonds may be made with the consent of the Company by an affirmative vote of the holders of a majority in aggregate principal amount of the Bonds entitled to vote then Outstanding, at a meeting of the holders of the Bonds called and held as provided in the Indenture, and by an affirmative vote of the holders of a majority in aggregate principal amount of the Bonds of any series or any tranche or tranches of any series entitled to vote then Outstanding and affected by such modification or alteration, in case one or more but less than all of the series of Bonds or of any tranche or tranches of any series of Bonds then Outstanding under the Indenture are so affected; provided, however, that no such modification or alteration shall be made which will affect the terms of payment of the principal of, or interest or premium, if any, on this Bond.

In case an Event of Default, as defined in the Indenture, shall occur, the principal of all the First Mortgage Bonds, Collateral (2004) Series C at any such time Outstanding under the Indenture may be declared or may become due and payable, upon the conditions and in the manner and with the effect provided in the Indenture. The Indenture provides that such declaration may be rescinded under certain circumstances.

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Exhibit D
to
Supplemental Indenture

Certain After-Acquired Property Subject to the Lien of the Indenture

Exhibit D

The following properties, located in the following counties of the State of South Dakota, are subject to the Lien of the Indenture pursuant to Granting Clause Second of the Original Indenture:

Beadle County

Outlot 13 of Coutts’ Outlots 9 thru 17, a Part of the North Half of the NW 1/4 of Section 13, Township 110, Range 62, Beadle County, South Dakota. Except: The East Seventy-five Feet (75’) of the South One Hundred Fifteen Feet (115’) of Outlot Thirteen (13), Coutts Outlots Nine (9) thru Seventeen (17), a part of the North one-half (N 1/2) of the Northwest Quarter (NW 1/4) of Section Thirteen (S13), Township One Hundred Ten North (T110N), Range Sixty-two West (R62W) of the Fifth (5th) Principal Meridian, City of Huron, Beadle County, South Dakota.

The West Five feet (5’) of the North Forty feet (40’) of the South Ninety feet (90’) of the Southeast Quarter (SE1/4) of Section Thirteen (S13), Township One Hundred Eleven North (T.111 N.), Range Sixty-four West (R.64 W.) of the Fifth (5th) Principal Meridian, Beadle County, South Dakota, containing 0.005 acres more or less.

The West Five feet (5’) of the North Fifteen feet (15’) of the South One Hundred Five feet (105’) of the Southeast Quarter (SE1/4) of Section Thirteen (S13), Township One Hundred Eleven North (T.111 N), Range Sixty-four West (R.64 W.) of the Fifth (5th) Principal Meridian, Beadle County, South Dakota, containing 0.005 acres more or less.

The South Twenty feet (20’) of the East Forty feet (40’) of Broadland Creek Industrial Park Lot Four (4), a part of the Southeast Quarter (SE1/4) of Section Twenty-five (S25), Township One Hundred Eleven North (T.111 N.), Range Sixty-two West (R.62 W.) of the Fifth (5th) Principal Meridian, Beadle County, South Dakota, containing 0.18 acres more of less.

Brown County

NORTHERN / NORTHWESTERN TBS ADDITION, a part of the Northeast Quarter (NE 1/4) of Section Nineteen (S 19), Township One Hundred Twenty-two North (T 122N), Range Sixty-three West (R. 63W) of the Fifth (5th) Principal Meridian, Brown County, South Dakota, containing 0.21 acres more or less.

Charles Mix County

Lot Three (3) and the South Eighteen feet (18’) of Lot Two (2), Block One (1), B. W. LASHIER’S FIRST ADDITION to the town (now City) of Wagner, Charles Mix County, South Dakota.

D-1

Clark County

NWPS FORDHAM \ CLARK GAS REG-STATION ADDITION, a part of the Northwest Quarter (NW1/4) of the Southwest Quarter (SW1/4) of Section One (S.1), Township One Hundred Fifteen North (T.115 N.), Range Fifty-nine West (R.59 W.) of the Fifth (5th) Principal Meridian, Clark County, South Dakota.

Davison County

The East Thirty-three feet (33’) of the North One Hundred Fifty feet (150’) of the South One Hundred Eighty-three feet (183’) of the Southeast Quarter (SE 1/4) of Section Nine (S9), Township One Hundred Three North (T. 103 N.), Range Sixty West (R. 60 W.) of the Fifth (5th) Principal Meridian, City of Mitchell, Davison County, South Dakota, said property being a portion of the vacated statutory public right-of-way lying between the Southeast Quarter (SE 1/4) of said Section Nine (S9) and Lot “N” in the Southwest Quarter (SW 1/4) of Section Ten (S10) Township One Hundred Three North (T. 103 N.) Range Sixty West (R. 60 W.), containing 0.11 acres more or less.

Day County

Lot One (1) and Lot Two (2) in Block Sixteen (16) of Prior’s First Addition to the City of Webster, Day County, South Dakota.

Hutchinson County

NWPS PARKSTON SUB SECOND ADDITION, a part of the Southeast Quarter (SE1/4) of the Northeast Quarter (NE1/4) of Section Thirteen (S.13), Township Ninety-nine North (T.99 N.), Range Sixty-one West (R.61 W.) of the Fifth (5th) Principal Meridian, in or adjacent to the City of Parkston, Hutchinson County, South Dakota, containing 0.14 acres more or less.

Lake County

The West Half (W.1/2) of Lot Ten (10) in Block Twenty-nine (29) of the Original Plat of Madison, Lake County, South Dakota, according to the recorded plat thereof.

NWPS LAKE MADISON TAP ADDITION, a part of the South One half (S1/2) of the Southwest Quarter (SW1/4) of Section One (1), Township One Hundred Five North (T.105 N.), Range Fifty-three West (R.53 W.) of the Fifth (5th) Principal Meridian, Lake County, South Dakota, containing 0.07 acres more or less.

NWPS LAKE MADISON REG ADDITION, a part of the Southwest Quarter (SW1/4) of the Northwest Quarter (NW1/4) of Section Five (S5), Township One Hundred Five North (T.105 N.), Range Fifty-one West (R.51 W.) of the Fifth (5th) Principal Meridian, Lake County, South Dakota, containing 0.13 acres more or less.

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Spink County

NWPS MELLETTE GAS REG-STA ADDITION, a part of Lot One of Wheat Growers Subdivision in the southeast Quarter (SE1/4) of Section Two (S2) Township One Hundred Nineteen North (T.119 N.), Range Sixty-four West (R.54 W.) of the Fifth (5th) Principal Meridian, Spink County, South Dakota, containing 0.09 acres more of less.

Yankton County

Gurney’s Outlot 3 in the Southwest Quarter (SW 1/4) of the Northeast Quarter (NE 1/4) of Section Twelve (12), Township Ninety-three (93) North, Range Fifty-six (56) West of the 5th P.M., City of Yankton, Yankton County, South Dakota, containing 8.76 acres more or less.

County Auditor’s Tract 1A in NE 1/4 of Section 2, Township 93 North, Range 57 West of the 5th P.M., Yankton County, South Dakota. (Commencing at a point 33 feet due West of the Northeast corner of Section 2, TWP 93 N., Range 57, Yankton County West of the 5th PM, thence due South a distance of 511.2 feet, thence due West a distance of 511.2 feet, thence due North a distance of 511.2 feet, thence due East to the point of beginning consisting of a tract of 6 acres subject to existing easement of record for road, highway of other public purposes.  Now known as County Auditor’s Tract #1, as platted in Book 4S, Page 4B.)

LOT “C” OF YAGGIES THIRD ADDITION, a portion of Yaggies Third Addition, situated in Northwest Quarter of Section Nine (S9), Township Ninety-three (T.93 N.), Range Fifty-five West (R.55 W.) of the Fifth (5th) Principal Meridian, Yankton County, South Dakota, containing 13.88 acres more or less.

D-3

EX-99.1

Exhibit 99.1

$225,000,000

CREDIT AGREEMENT

among

NORTHWESTERN CORPORATION,

as Borrower,

The Several Lenders
from Time to Time Parties Hereto,

LEHMAN BROTHERS INC.
and
DEUTSCHE BANK SECURITIES INC.,
as Joint Lead Arrangers,

DEUTSCHE BANK SECURITIES INC.,
as Syndication Agent,

UNION BANK OF CALIFORNIA, N.A. and

KEYBANK NATIONAL ASSOCIATION,
as Co-Documentation Agents,

and
LEHMAN COMMERCIAL PAPER INC.,
as Administrative Agent
and
as Collateral Agent

Dated as of November 1, 2004

TABLE OF CONTENTS

SECTION 1. DEFINITIONS
	1.1	Defined Terms
	1.2	Other Definitional Provisions
SECTION 2. AMOUNT AND TERMS OF COMMITMENTS
	2.1	Term Loan Commitments
	2.2	Procedure for Term Loan Borrowing
	2.3	Repayment of Term Loans
	2.4	Revolving Credit Commitments
	2.5	Procedure for Revolving Credit Borrowing
	2.6	Swing Line Commitment
	2.7	Procedure for Swing Line Borrowing; Refunding of Swing Line Loans
	2.8	Repayment of Loans; Evidence of Debt
	2.9	Commitment Fees, etc
	2.10	Termination or Reduction of Revolving Credit Commitments
	2.11	Optional Prepayments
	2.12	Mandatory Prepayments and Commitment Reductions
	2.13	Conversion and Continuation Options
	2.14	Minimum Amounts and Maximum Number of Eurodollar Tranches
	2.15	Interest Rates and Payment Dates
	2.16	Computation of Interest and Fees
	2.17	Inability to Determine Interest Rate
	2.18	Pro Rata Treatment and Payments
	2.19	Requirements of Law
	2.20	Taxes
	2.21	Indemnity
	2.22	Illegality
	2.23	Change of Lending Office
	2.24	Replacement of Lenders under Certain Circumstances
SECTION 3.		LETTERS OF CREDIT
	3.1	L/C Commitment
	3.2	Procedure for Issuance of Letter of Credit
	3.3	Fees and Other Charges
	3.4	L/C Participations
	3.5	Reimbursement Obligation of the Borrower
	3.6	Obligations Absolute
	3.7	Letter of Credit Payments
	3.8	Applications
SECTION 4.		REPRESENTATIONS AND WARRANTIES
	4.1	Financial Condition
	4.2	No Change
	4.3	Corporate Existence; Compliance with Law

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	4.4	Corporate Power; Authorization; Enforceable Obligations
	4.5	No Legal Bar
	4.6	No Material Litigation
	4.7	No Default
	4.8	Ownership of Property
	4.9	Intellectual Property
	4.10	Taxes
	4.11	Federal Regulations
	4.12	Labor Matters
	4.13	ERISA
	4.14	Investment Company Act; Other Regulations; PUHCA
	4.15	Subsidiaries
	4.16	Use of Proceeds
	4.17	Environmental Matters
	4.18	Accuracy of Information, etc
	4.19	Security Documents.
	4.20	Solvency
SECTION 5.		CONDITIONS PRECEDENT
	5.1	Conditions to Initial Extension of Credit
	5.2	Conditions to Term Loans
	5.3	Conditions to Each Extension of Credit
SECTION 6.		AFFIRMATIVE COVENANTS
	6.1	Financial Statements
	6.2	Certificates; Other Information
	6.3	Payment of Obligations
	6.4	Conduct of Business and Maintenance of Existence; Compliance.
	6.5	Maintenance of Property; Insurance
	6.6	Inspection of Property; Books and Records; Discussions
	6.7	Notices
	6.8	Environmental Laws
	6.9	Further Assurances
	6.10	Credit Ratings
	6.11	Excluded Subsidiaries
SECTION 7.		NEGATIVE COVENANTS
	7.1	Financial Condition Covenants
	7.2	Limitation on Indebtedness
	7.3	Limitation on Liens
	7.4	Limitation on Fundamental Changes
	7.5	Limitation on Disposition of Property
	7.6	Limitation on Restricted Payments
	7.7	Limitation on Investments
	7.8	Limitation on Optional Payments and Modifications of Debt Instruments, etc
	7.9	Limitation on Transactions with Affiliates

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	7.10	Limitation on Release of Mortgaged Property; Limitation in Respect of Insurance
	7.11	Limitation on Subjecting Property or Other Assets to the Lien of the Other Indenture
	7.12	Prohibition on Designating Class “A” Mortgages or Permitting Qualified Lien Bonds to Exist
	7.13	Limitation on Amendments or Supplements to the Indentures
	7.14	Prohibition on Second Mortgage Bonds
	7.15	Limitation on Changes in Fiscal Periods
	7.16	Limitation on Negative Pledge Clauses
	7.17	Limitation on Restrictions on Subsidiary Distributions
	7.18	Limitation on Lines of Business
	7.19	Limitation on Hedge Agreements.
SECTION 8.		EVENTS OF DEFAULT
SECTION 9.		THE AGENTS
	9.1	Appointment
	9.2	Delegation of Duties
	9.3	Exculpatory Provisions
	9.4	Reliance by Agents
	9.5	Notice of Default
	9.6	Non-Reliance on Agents and Other Lenders
	9.7	Indemnification
	9.8	Agent in Its Individual Capacity
	9.9	Successor Administrative Agent
	9.10	The Arrangers; the Syndication Agent; the Co-Documentation Agents
SECTION 10.		MISCELLANEOUS
	10.1	Amendments and Waivers
	10.2	Voting of First Mortgage Bonds
	10.3	Notices
	10.4	No Waiver; Cumulative Remedies
	10.5	Survival of Representations and Warranties
	10.6	Payment of Expenses
	10.7	Successors and Assigns; Participations and Assignments
	10.8	Adjustments; Set-off
	10.9	Counterparts
	10.10	Severability
	10.11	Integration
	10.12	GOVERNING LAW
	10.13	Submission To Jurisdiction; Waivers
	10.14	Acknowledgments
	10.15	Confidentiality
	10.16	Accounting Changes
	10.17	Delivery of Lender Addenda
	10.18	WAIVERS OF JURY TRIAL

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ANNEXES:
A	Pricing Grid
B	Existing Letters of Credit
SCHEDULES:
1.1			Gas Storage Arrangements
4.4(a)			First Mortgage Approvals
4.4(b)			Consents, Authorizations, Filings and Notices
4.6			Litigation
4.8			Title to Property
4.13			ERISA
4.14			Limiting Regulations
4.15			Subsidiaries
4.17			Environmental
7.2(d)			Existing Indebtedness
7.3(f)			Existing Liens
7.7			Existing Investments
7.9			Affiliate Transactions
7.16			Negative Pledge Limitations
EXHIBITS:
A		Form of Bond Delivery Agreement
B		Form of Compliance Certificate
C-1		Form of Secretary’s Certificate
C-2		Form of Closing Certificate
D-1		Form of Term Note
D-2		Form of Revolving Credit Note
D-3		Form of Swing Line Note
E		Form of Assignment and Acceptance
F		Form of Exemption Certificate
G		Form of Lender Addendum
H		Form of Borrowing Notice
I		Form of Letter of Credit Request

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CREDIT AGREEMENT, dated as of November 1, 2004, among NORTHWESTERN CORPORATION, a Delaware corporation (the “Borrower”), the several banks and other financial institutions or entities from time to time parties to this Agreement (the “Lenders”), LEHMAN BROTHERS INC. and DEUTSCHE BANK SECURITIES INC., as joint lead arrangers and joint bookrunners (in such capacity, the “Arrangers”), DEUTSCHE BANK SECURITIES INC., as syndication agent (in such capacity, the “Syndication Agent”), UNION BANK OF CALIFORNIA, N.A. and KEYBANK NATIONAL ASSOCIATION, as Co-documentation agents (in such capacity, the “Co-Documentation Agents”), and LEHMAN COMMERCIAL PAPER INC., as administrative agent (in such capacity, the “Administrative Agent”) and as collateral agent (in such capacity, the “Collateral Agent”).

W I T N E S S E T H:

WHEREAS, the Borrower has filed a case under Chapter 11 of the United States Bankruptcy Code (the “Bankruptcy Case”) in the United States Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”) and the Borrower plans to emerge from the Bankruptcy Case pursuant to the Borrower’s Second Amended and Restated Plan of Reorganization dated August 18, 2004 under Chapter 11 of the Bankruptcy Code (as amended from time to time, the “Plan of Reorganization”) and, pursuant thereto, to consummate certain financings on the Effective Date as defined under the Plan of Reorganization;

WHEREAS, in order to obtain funds necessary to consummate such financings the Borrower has requested the Lenders to (A) extend credit to the Borrower in the form of term loans in an aggregate principal amount not in excess of $100,000,000 and (B) make revolving credit loans in an aggregate principal amount not in excess of $125,000,000 at any one time outstanding.  The proceeds of the term loans are to be used by the Borrower to refinance existing indebtedness, including without limitation the repayment of all amounts due or outstanding under the Existing Credit Facility and to pay related fees and expenses.  The proceeds of the revolving credit loans are to be used by the Borrower for general corporate purposes of the Borrower and its subsidiaries (other than the Excluded Subsidiaries) in the ordinary course of business.  The Loans shall be secured by the issuance of certain first mortgage bonds to and registered in the name of the Collateral Agent for the ratable benefit of the Lenders (it being understood that payments on the Loans shall be deemed payments on such first mortgage bonds and payments on such first mortgage bonds shall be applied to the payment of the Loans); and

WHEREAS, the Lenders are willing to make such credit facilities available to the Borrower upon and subject to the terms and conditions hereinafter set forth;

NOW, THEREFORE, in consideration of the premises and the agreements hereinafter set forth, the parties hereto hereby agree as follows:

SECTION 1.           DEFINITIONS

1.1           Defined Terms.  As used in this Agreement, the terms listed in this Section 1.1 shall have the respective meanings set forth in this Section 1.1.

“Acquisition”: any transaction, or any series of related transactions, by which the Borrower (a) acquires any ongoing business or all or substantially all of the assets of any Person or

division thereof which constitutes an ongoing business, whether through purchase of assets, merger or otherwise (other than through the acquisition of Capital Stock of such Person) or (b) directly or indirectly acquires the Capital Stock of any Person such that such Person would be a Wholly Owned Subsidiary after giving effect to such acquisition (and any related transactions consummated substantially simultaneously therewith).

“Administrative Agent”:  as defined in the preamble hereto.

“Affiliate”:  as to any Person, any other Person that, directly or indirectly, is in control of, is controlled by, or is under common control with, such Person.  For purposes of this definition, “control” of a Person means the power, directly or indirectly, either to (a) vote 10% or more of the securities having ordinary voting power for the election of directors (or persons performing similar functions) of such Person or (b) direct or cause the direction of the management and policies of such Person, whether by contract or otherwise.

“Agents”:  the collective reference to the Syndication Agent, the Administrative Agent, the Co-Documentation Agents and the Collateral Agent.

“Aggregate Exposure”:  with respect to any Lender at any time, an amount equal to (a) until the Closing Date, the aggregate amount of such Lender’s Commitments at such time and (b) thereafter, the sum of (i) the aggregate then unpaid principal amount of such Lender’s Term Loans and (ii) the amount of such Lender’s Revolving Credit Commitment then in effect or, if the Revolving Credit Commitments have been terminated, the amount of such Lender’s Revolving Extensions of Credit then outstanding.

“Aggregate Exposure Percentage”:  with respect to any Lender at any time, the ratio (expressed as a percentage) of such Lender’s Aggregate Exposure at such time to the sum of the Aggregate Exposures of all Lenders at such time.

“Agreement”:  this Credit Agreement, as amended, supplemented or otherwise modified from time to time.

“Applicable Margin”:  (i) in the case of Revolving Credit Loans, a percentage determined from time to time in accordance with the pricing grid attached hereto as Annex A and (ii) in the case of Term Loans, 175 basis points for Eurodollar Loans and 75 basis points for Base Rate Loans.

“Application”:  an application, in such form as the relevant Issuing Lender may specify from time to time, requesting such Issuing Lender to issue a Letter of Credit.

“Arrangers”:  as defined in the preamble hereto.

“Asset Sale”:  any Disposition of Property or series of related Dispositions of Property (excluding any such Disposition permitted by clause (a), (b), (c), (d), (e) or (h) of Section 7.5) which yields gross proceeds to the Borrower or any of its Subsidiaries (valued at the initial principal amount thereof in the case of non-cash proceeds consisting of notes or other debt securities and valued at fair market value in the case of other non-cash proceeds) in excess of $5,000,000.

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“Assignee”:  as defined in Section 10.7(c).

“Assignor”:  as defined in Section 10.7(c).

“Available Revolving Credit Commitment”:  with respect to any Revolving Credit Lender at any time, an amount equal to the excess, if any, of (a) such Lender’s Revolving Credit Commitment then in effect over (b) such Lender’s Revolving Extensions of Credit then outstanding.

“Bankruptcy Case”:  as defined in the recitals hereto.

“Bankruptcy Court”:  as defined in the recitals hereto.

“Base Rate”:  for any day, a rate per annum (rounded upwards, if necessary, to the next 1/100 of 1%) equal to the greater of (a) the Prime Rate in effect on such day and (b) the Federal Funds Effective Rate in effect on such day plus ½ of 1%.  For purposes hereof:  “Prime Rate” shall mean the prime lending rate as set forth on the British Banking Association Telerate Page 5 (or such other comparable page as may, in the reasonable opinion of the Administrative Agent, replace such page for the purpose of displaying such rate), as in effect from time to time.    Any change in the Base Rate due to a change in the Prime Rate or the Federal Funds Effective Rate shall be effective as of the opening of business on the effective day of such change in the Prime Rate or the Federal Funds Effective Rate, respectively.

“Base Rate Loans”:  Loans for which the applicable rate of interest is based upon the Base Rate.

“Benefitted Lender”:  as defined in Section 10.8.

“Blue Dot”:  collectively, Blue Dot Services, Inc., a Delaware corporation, and its Subsidiaries.

“Board”:  the Board of Governors of the Federal Reserve System of the United States (or any successor).

“Bond Delivery Agreement”:  the Bond Delivery and Collateral Agreement to be executed and delivered by the Borrower and the Collateral Agent, substantially in the form of Exhibit A, as the same may be amended, supplemented or otherwise modified from time to time.

“Borrower”:  as defined in the preamble hereto.

“Borrowing Date”:  any Business Day specified by the Borrower as a date on which the Borrower requests the relevant Lenders to make Loans hereunder.

“Borrowing Notice”:  with respect to any request for borrowing of Loans hereunder, a notice from the Borrower, substantially in the form of, and containing the information prescribed by, Exhibit H, delivered to the Administrative Agent.

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“Business Day”:  (a) for all purposes other than as covered by clause (b) below, a day other than a Saturday, Sunday or other day on which commercial banks in New York City are authorized or required by law to close and (b) with respect to all notices and determinations in connection with, and payments of principal and interest on, Eurodollar Loans, any day which is a Business Day described in clause (a) and which is also a day for trading by and between banks in Dollar deposits in the interbank eurodollar market.

“Capital Lease Obligations”:  with respect to any Person, the obligations of such Person to pay rent or other amounts under any lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted for as capital leases on a balance sheet of such Person under GAAP; and, for the purposes of this Agreement, the amount of such obligations at any time shall be the capitalized amount thereof at such time determined in accordance with GAAP.

“Capital Stock”:  any and all shares, interests, participations or other equivalents (however designated) of capital stock of a corporation, any and all equivalent ownership interests in a Person (other than a corporation) and any and all warrants, rights or options to purchase any of the foregoing.

“Cash Equivalents”:  (a) marketable direct obligations issued by, or unconditionally guaranteed by, the United States government or issued by any agency thereof and backed by the full faith and credit of the United States, in each case maturing within one year from the date of acquisition; (b) certificates of deposit, time deposits, bankers acceptances, eurodollar time deposits or overnight bank deposits having maturities of six months or less from the date of acquisition issued by any Lender or by any commercial bank organized under the laws of the United States of America or any state thereof having combined capital and surplus of not less than $500,000,000; (c) commercial paper of an issuer rated at least A-2 by Standard & Poor’s or P-2 by Moody’s, or carrying an equivalent rating by a nationally recognized rating agency, if both of the two named rating agencies cease publishing ratings of commercial paper issuers generally, and maturing within 270 days from the date of acquisition; (d) repurchase obligations of any Lender or of any commercial bank satisfying the requirements of clause (b) of this definition, having a term of not more than 30 days with respect to securities issued or fully guaranteed or insured by the United States government; (e) securities (including tax-exempt debt obligations) with maturities of one year or less from the date of acquisition issued or fully guaranteed by any state, commonwealth or territory of the United States, by any political subdivision or taxing authority of any such state, commonwealth or territory or by any foreign government, the securities of which state, commonwealth, territory, political subdivision, taxing authority or foreign government (as the case may be) are rated at least A by

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Standard & Poor’s or A2 by Moody’s (or publicly traded or open-ended bond funds that invest exclusively in such securities); (f) securities with maturities of six months or less from the date of acquisition backed by standby letters of credit issued by any Lender or any commercial bank satisfying the requirements of clause (b) of this definition; (g) Dollar denominated debt obligations of corporations maturing within 12 months from the date of the acquisition rated at least A by Standard & Poor’s or A2 by Moody’s; (h) shares of bond funds rated at least A by Standard & Poor’s or A2 by Moody’s having weighted average maturities of 12 months or less; (i) auction rate securities rated at least AAA by Standard & Poor’s or Aaa by Moody’s; (j) debt obligations of corporations maturing within 12 months from the date of acquisition rated at least A by Standard & Poor’s or A2 by Moody’s; (k) Canadian currency deposits having maturities of 3 months or less held by any Canadian Subsidiary; (l) shares of money market mutual or similar funds which invest exclusively in assets satisfying the requirements of clauses (a) through (k) of this definition.

“Change of Control”:  the occurrence of any of the following events:  (a)                any Person or “group” (within the meaning of Section 13(d) or 14(d) of the Securities Exchange Act of 1934) (i) shall have acquired beneficial ownership of 40% or more of the aggregate outstanding classes of Capital Stock having voting power in the election of directors of the Borrower or (ii) shall obtain the power (whether or not exercised) to elect a majority of the Borrower’s directors; (b) a majority of the seats (other than vacant seats) on the Board of Directors of the Borrower shall at any time be occupied by Persons who were neither (i) nominated by the Board of Directors, (ii) nominated by any Person having, as of the Closing Date, beneficial ownership of  20% or more of the aggregate outstanding classes of Capital Stock having voting power in the election of directors of the Borrower, nor (iii) appointed by directors so nominated; (c) the Borrower shall be liquidated or dissolved; or (d) a “Change of Control” as such term is defined in the Senior Notes Indenture.  For the avoidance of doubt, neither the issuance of Capital Stock nor the appointment of directors, in each case on or before the Closing Date, in connection with the implementation of the Reorganization Plan shall constitute a “Change of Control” under clause (a) or (b) above.

“Closing Date”:  the date on which the conditions precedent set forth in Section 5.1 shall have been satisfied, which date shall be not later than November 1, 2004.

“Code”:  the Internal Revenue Code of 1986, as amended from time to time.

“Co-Documentation Agents”:  as defined in the preamble hereto.

“Collateral”:  the First Mortgage Bonds issued to and registered in the name of the Collateral Agent.

“Collateral Agent”:  as defined in the preamble hereto.

“Colstrip”:  collectively, the Colstrip 1, 2 and 3 Transmission Assets and the Colstrip 4 Interest.

“Colstrip 1, 2 and 3 Transmission Assets”:  collectively, (a) the portion of the Borrower’s interest in the facilities for the transmission of the output from the Colstrip 1 and 2 generating project and the Colstrip 3 and 4 generating project in the vicinity of Colstrip, Montana, to the interconnection with the transmission system of Bonneville Power Administration (“BPA”) in the vicinity of Townsend, Montana, relating to the 50% undivided interest formerly owned by the Borrower in Colstrip Units 1 and 2 and the 30% undivided interest formerly owned by the Borrower in Colstrip Unit 3, (b) the related interest of the Borrower in the Colstrip Project Transmission Agreement, dated as of May 6, 1981, as amended (the “Colstrip Project Transmission Agreement”), among The Montana Power Company, Puget Sound Power & Light Company, The Washington Water Power Company and Portland General Electric Company, and (c) the related interest of the Borrower in all contracts, transferable permits and other tangible and intangible assets relating to the foregoing.  The transmission

5

facilities include 500 kV transmission lines in two segments, one line from the Colstrip 500 kV switchyard to the Broadview 500 kV switchyard northwest of Billings, Montana, and two lines from the Broadview 500 kV switchyard to the interconnection with BPA’s 500 kV double circuit line near Townsend, Montana and are generally described in the Colstrip Project Transmission Agreement.  As of the date hereof, the transmission allocation associated with the Colstrip 1, 2 and 3 interests consists of 612.8 MW on the Colstrip-Broadview segment and 258.5 MW on the Broadview-Townsend segment.

“Colstrip 4 Interest”:  all assets and property of any kind relating to the Borrower’s interest in Unit 4 of the Colstrip generating project, including real property interests, contracts, transferable permits and other tangible and intangible assets relating to the forgoing.  The Colstrip 4 Interest includes the Borrower’s leasehold interest in a 30% undivided interest in Unit 4 and a 15% undivided interest in the common facilities relating thereto which was sold and leased back pursuant to a lease financing transaction, certain retained assets which were not part of the lease financing, fee interests in the plant site property and related property, the related interest in the Ownership and Operation Agreement related to Units 3 and 4, and contracts for the sale of power from Unit 4.

“Commitment”:  with respect to any Lender, each of the Term Loan Commitment and the Revolving Credit Commitment of such Lender.

“Commitment Fee Rate”:  the rate per annum determined from time to time pursuant to the pricing grid attached hereto as Annex A.

“Commonly Controlled Entity”:  an entity, whether or not incorporated, that is under common control with the Borrower within the meaning of Section 4001 of ERISA or is part of a group that includes the Borrower and that is treated as a single employer under Section 414 of the Code.

“Compliance Certificate”:  a certificate duly executed by a Responsible Officer, substantially in the form of Exhibit B.

“Confidential Information Memorandum”:  collectively, the Confidential Information Memorandum Executive Summary, including Projection Supplement, dated August 2004 and the Confidential Information Memorandum, including Projection Supplement, dated September 2004, furnished to the initial Lenders in connection with the syndication of the Facilities.

“Confirmation Order”:  as defined in Section 5.1(d).

“Consolidated Debt to Capitalization Ratio”:  as of the last day of any period, the ratio of (a) Consolidated Funded Debt on such day to (b) the sum of Consolidated Net Worth and Consolidated Funded Debt on such day.

“Consolidated EBITDA”:  of any Person for any period, Consolidated Net Income of such Person and its Subsidiaries for such period plus, without duplication and to the extent reflected as a charge in the statement of such Consolidated Net Income for such period, the sum of (a) income tax expense, (b) interest expense of such Person and its Subsidiaries, amortization

6

or writeoff of debt discount and debt issuance costs and commissions, discounts and other fees and charges associated with Indebtedness, (c) depreciation and amortization expense, (d) amortization of intangibles (including, but not limited to, goodwill) and organization costs, (e) any extraordinary, unusual or non-recurring non-cash expenses or losses (including losses on sales of assets outside of the ordinary course of business whether or not otherwise includable as a separate item in the statement of such Consolidated Net Income for such period, but excluding any such expenses or losses that constitute an accrual of or reserve for future cash payments), and (f) bankruptcy related and other one-time expenses acceptable to the Administrative Agent not to exceed $18.9 million for FQ4 2003, $9.2 million for FQ1 2004, $12.9 million for FQ2 2004, $10.6 million for FQ3 2004 and $25 million for FQ4 2004 minus, to the extent included in the statement of such Consolidated Net Income for such period, the sum of (i) interest income (except to the extent deducted in determining such Consolidated Net Income), and (ii) any extraordinary, unusual or non-recurring income or gains (including gains on sales of assets outside of the ordinary course of business whether or not otherwise includable as a separate item in the statement of such Consolidated Net Income for such period), all as determined on a consolidated basis.

“Consolidated Funded Debt”:  at any date, the aggregate principal amount of all Funded Debt of the Borrower and its Subsidiaries at such date, determined on a consolidated basis in accordance with GAAP.

“Consolidated Interest Coverage Ratio”:  for any period, the ratio of (a) Consolidated EBITDA of the Borrower and its Subsidiaries for such period to (b) Consolidated Interest Expense of the Borrower and its Subsidiaries for such period.

“Consolidated Interest Expense”:  of any Person for any period, total cash interest expense (including that attributable to Capital Lease Obligations) of such Person and its Subsidiaries for such period with respect to all outstanding Indebtedness of such Person and its Subsidiaries (including, without limitation, all commissions, discounts and other fees and charges owed by such Person with respect to letters of credit and bankers’ acceptance financing and net costs of such Person under Hedge Agreements in respect of interest rates to the extent such net costs are allocable to such period in accordance with GAAP); provided, however, that for purposes of Section 7.1(a), (i) Consolidated Interest Expense for the period ending with FQ1 2005 shall mean Consolidated Interest Expense for FQ1 2005 multiplied by four, (ii) Consolidated Interest Expense for the period ending with FQ2 2005 shall mean Consolidated Interest Expense for the two consecutive fiscal quarters ending with FQ2 2005 multiplied by two, and (iii) Consolidated Interest Expense for the period ending with FQ3 2005 shall mean Consolidated Interest Expense for the three consecutive fiscal quarters ending with FQ3 2005 multiplied by 4/3rds.

“Consolidated Net Income”:  of any Person for any period, the consolidated net income (or loss) of such Person and its Subsidiaries for such period, determined on a consolidated basis in accordance with GAAP; provided, that in calculating Consolidated Net Income of the Borrower and its consolidated Subsidiaries for any period, there shall be excluded (a) the income (or deficit) of any Person accrued prior to the date it becomes a Subsidiary of the Borrower or is merged into or consolidated with the Borrower or any of its Subsidiaries, (b) the income (or deficit) of any Person (other than a Subsidiary of the Borrower) in which the

7

Borrower or any of its Subsidiaries has an ownership interest, except to the extent that any such income is actually received by the Borrower or such Subsidiary in the form of dividends or similar distributions and (c) the undistributed earnings of any Subsidiary of the Borrower to the extent that the declaration or payment of dividends or similar distributions by such Subsidiary is not at the time permitted by the terms of any Contractual Obligation (other than under any Loan Document) or Requirement of Law applicable to such Subsidiary.

“Consolidated Net Worth”:  at any date, all amounts that would, in conformity with GAAP, be included on a consolidated balance sheet of the Borrower and its Subsidiaries under stockholders’ equity at such date.

“Contractual Obligation”:  as to any Person, any provision of any security issued by such Person or of any agreement, instrument or other undertaking to which such Person is a party or by which it or any of its Property is bound.

“Cornerstone”:  collectively, Cornernorth, LLC and its Subsidiaries.

“Default”:  any of the events specified in Section 8, whether or not any requirement for the giving of notice, the lapse of time, or both, has been satisfied.

“Defaulted Advance” means, with respect to any Lender at any time, the portion of any amounts required to be paid or made available by such Lender to the Borrower pursuant to Sections 2.1 or 2.4 at or prior to such time which has not been made by such Lender or by the Administrative Agent for the account of such Lender pursuant to Section 2.18(f) as of such time.

“Defaulted Amount” means, with respect to any Lender at any time, any amount required to be paid by such Lender to the Administrative Agent or any other Lender hereunder or under any other Loan Document at or prior to such time which has not been so paid as of such time, including, without limitation, any amount required to be paid by such Lender to (a) the Swing Line Lender pursuant to Section 2.7, (b) the Issuing Lender pursuant to Section 3.4, (c) the Administrative Agent pursuant to Sections 2.2, 2.5 or 2.7, (d) any other Lender pursuant to Section 2.7 and (e) any Agent pursuant to Section 9.7.

“Defaulting Lender” means, at any time that the conditions precedent set forth in Sections 5.1, 5.2 and 5.3 have been satisfied or properly waived, any Lender that, at such time, (a) owes a Defaulted Advance or a Defaulted Amount or (b) shall take any action with respect to itself or be the subject of any action or proceeding of a type described in Section 8(f).

“Derivatives Counterparty”:  as defined in Section 7.6.

“Deutsche Bank Entity”:  any of Deutsche Bank Securities Inc. or any of its affiliates.

“Disclosure Statement”:  the Second Amended and Restated Disclosure Statement of the Borrower dated August 18, 2004.

“Disposition”:  with respect to any Property, any sale, lease, sale and leaseback, assignment, conveyance, transfer or other disposition thereof (or, in each case, any series of

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related dispositions); and the terms “Dispose” and “Disposed of” shall have correlative meanings.

 “Dollars” and “$”:  dollars in lawful currency of the United States of America.

“Environmental Laws”:  any and all laws, rules, orders, regulations, statutes, ordinances, guidelines, codes, decrees, or other legally enforceable requirements (including, without limitation, common law) of any international authority, foreign government, the United States, or any state, local, municipal or other governmental authority, regulating, relating to or imposing liability or standards of conduct concerning protection of the environment or of human health, or employee health and safety, as has been, is now, or may at any time hereafter be, in effect.

“Environmental Permits”:  any and all permits, licenses, approvals, registrations, notifications, exemptions and other authorizations required under any Environmental Law.

“ERISA”:  the Employee Retirement Income Security Act of 1974, as amended from time to time.

“Eurocurrency Reserve Requirements”:  for any day, as applied to a Eurodollar Loan, the aggregate (without duplication) of the maximum rates (expressed as a decimal fraction) of reserve requirements in effect on such day (including, without limitation, basic, supplemental, marginal and emergency reserves) under any regulations of the Board or other Governmental Authority having jurisdiction with respect thereto dealing with reserve requirements prescribed for eurocurrency funding (currently referred to as “Eurocurrency Liabilities” in Regulation D of the Board) maintained by a member bank of the Federal Reserve System.

“Eurodollar Base Rate”:  with respect to each day during each Interest Period, the rate per annum determined on the basis of the rate for deposits in Dollars for a period equal to such Interest Period commencing on the first day of such Interest Period appearing on Page 3750 of the Telerate screen as of 11:00 A.M., London time, two Business Days prior to the beginning of such Interest Period.  In the event that such rate does not appear on Page 3750 of the Telerate screen (or otherwise on such screen), the “Eurodollar Base Rate” for purposes of this definition shall be determined by reference to such other comparable publicly available service for displaying eurodollar rates as may be selected by the Administrative Agent.

“Eurodollar Loans”:  Loans for which the applicable rate of interest is based upon the Eurodollar Rate.

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

Eurodollar Base Rate

1.00 - Eurocurrency Reserve Requirements

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“Eurodollar Tranche”:  the collective reference to Eurodollar Loans under a particular Facility the then current Interest Periods with respect to all of which begin on the same date and end on the same later date (whether or not such Loans shall originally have been made on the same day).

“Event of Default”:  any of the events specified in Section 8, provided that any requirement for the giving of notice, the lapse of time, or both, has been satisfied.

“Excess Cash Flow”:  with respect to any specified Person for any period, the Consolidated EBITDA of such Person for such period, minus:

(A)          the items delineated in clauses (a), (b) and (f) of the definition of Consolidated EBITDA, to the extent such items were actually paid in cash during such period; minus,

(B)           capital expenditures of such Person and its Subsidiaries for such period,

in each case, on a consolidated basis, determined in accordance with GAAP.

“Excluded Subsidiaries”:  collectively, Blue Dot, Cornerstone and Netexit.

“Existing Credit Facility”:  that certain Amended and Restated Credit Agreement dated as of November 10, 2003 among the Borrower, the Lenders party thereto and Credit Suisse First Boston, as administrative agent, as amended to the date hereof.

“Existing Letters of Credit”:  collectively, the letters of credit listed on Annex B issued for the account of the Borrower pursuant to the terms of the Existing Credit Facility.

“Facility”:  collectively, each of (a) the Term Loan Commitments and the Term Loans made thereunder (the “Term Loan Facility”) and (b) the Revolving Credit Commitments and the extensions of credit made thereunder (the “Revolving Credit Facility”).

“Federal Funds Effective Rate”:  for any day, the weighted average of the rates on overnight federal funds transactions with members of the Federal Reserve System arranged by federal funds brokers, as published on the next succeeding Business Day by the Federal Reserve Bank of New York, or, if such rate is not so published for any day that is a Business Day, the average of the quotations for the day of such transactions received by the Administrative Agent from three federal funds brokers of recognized standing selected by it.

“Fee Letter”:  the Fee Letter dated August 12, 2004 among Lehman Brothers Inc. and Deutsche Bank Securities Inc. (“DBSI”) as exclusive joint lead book managers and joint lead arrangers, DBSI, as syndication agent, Lehman Commercial Paper Inc., as administrative agent, collateral agent and an initial lender, Deutsche Bank AG Cayman Islands Branch as an initial lender, and the Borrower.

“Final Order”:  an order, ruling or judgment of the Bankruptcy Court as to which the time to appeal or petition for certiorari, or move for reargument or rehearing has expired and

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as to which no appeal, petition for certiorari, or other proceedings for reargument or rehearing shall then be pending, or as to which any right to appeal, petition for certiorari, reargue, or rehear shall have been waived in writing in form and substance satisfactory to the Borrower or, in the event that an appeal, writ of certiorari, or reargument or rehearing thereof has been sought, such order or judgment of the Bankruptcy Court shall have been determined by the highest court to which such order was appealed, or certiorari, reargument or rehearing shall have been denied and the time to take any further appeal, petition for certiorari or move for reargument or rehearing shall have expired; provided, however, that the possibility that a motion under Rule 59 or Rule 60 of the Federal Rules of Civil Procedure, or any analogous rule under the Bankruptcy Rules, may be filed with respect to such order shall not cause such order not to be a Final Order.

“First Mortgage Approvals”:  shall have the meaning ascribed thereto in Section 4.4.

“First Mortgage Bonds”:  the first mortgage bonds issued, pursuant to the Indentures, to and registered in the name of the Collateral Agent, initially in the respective principal amounts and series set forth in Section 5.1(h).

“FQ1”, “FQ2 “, “FQ3”, and “FQ4”: when used with a numerical year designation, means the first, second, third or fourth fiscal quarters, respectively, of such fiscal year of the Borrower (e.g., FQ1 2004 means the first fiscal quarter of the Borrower’s 2004 fiscal year, which ended March 31, 2004).

“Funded Debt”:  with respect to any Person, all Indebtedness of such Person of the types described in clauses (a) through (e) of the definition of “Indebtedness” in this Section 1.1.

“Funding Office”:  the office specified from time to time by the Administrative Agent as its funding office by notice to the Borrower and the Lenders.

“GAAP”:  generally accepted accounting principles in the United States of America as in effect from time to time.

“Governmental Authority”:  any nation or government, any state or other political subdivision thereof, any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative functions of or pertaining to government, and any securities exchange.

“Guarantee Obligation”:  as to any Person (the “guaranteeing person”), any obligation, including a reimbursement, counterindemnity or similar obligation, of the guaranteeing person that guarantees or in effect guarantees, or which is given to induce the creation of a separate obligation by another Person (including any bank under any letter of credit) that guarantees or in effect guarantees any Indebtedness, leases, dividends or other obligations (the “primary obligations”) of any other third Person (the “primary obligor”) in any manner, whether directly or indirectly, including, without limitation, any obligation of the guaranteeing person, whether or not contingent, (i) to purchase any such primary obligation or any Property constituting direct or indirect security therefor, (ii) to advance or supply funds (1) for the purchase or payment of any such primary obligation or (2) to maintain working capital or

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 equity capital of the primary obligor or otherwise to maintain the net worth or solvency of the primary obligor, (iii) to purchase Property, securities or services primarily for the purpose of assuring the owner of any such primary obligation of the ability of the primary obligor to make payment of such primary obligation or (iv) otherwise to assure or hold harmless the owner of any such primary obligation against loss in respect thereof; provided, however, that the term Guarantee Obligation shall not include endorsements of instruments for deposit or collection in the ordinary course of business.  The amount of any Guarantee Obligation of any guaranteeing person shall be deemed to be the lower of (a) an amount equal to the stated or determinable amount of the primary obligation in respect of which such Guarantee Obligation is made and (b) the maximum amount for which such guaranteeing person may be liable pursuant to the terms of the instrument embodying such Guarantee Obligation, unless such primary obligation and the maximum amount for which such guaranteeing person may be liable are not stated or determinable, in which case the amount of such Guarantee Obligation shall be such guaranteeing person’s maximum reasonably anticipated liability in respect thereof as determined by the Borrower in good faith.

“Hedge Agreements”:  all interest rate or currency swaps, caps or collar agreements, foreign exchange agreements, or similar arrangements entered into by the Borrower or its Subsidiaries providing for protection against fluctuations in interest rates, currency exchange rates, or the exchange of nominal interest obligations, either generally or under specific contingencies.

“Indebtedness”:  of any Person at any date, without duplication, (a) all indebtedness of such Person for borrowed money, (b) all obligations of such Person for the deferred purchase price of Property or services (other than trade payables incurred in the ordinary course of such Person’s business), (c) all obligations of such Person evidenced by notes, bonds, debentures or other similar instruments, (d) all indebtedness created or arising under any conditional sale or other title retention agreement with respect to Property acquired by such Person (even though the rights and remedies of the seller or lender under such agreement in the event of default are limited to repossession or sale of such Property), other than any such indebtedness arising solely in connection with the Borrower’s gas storage arrangements as more particularly described on Schedule 1.1, (e) all Capital Lease Obligations of such Person, (f) all obligations of such Person, contingent or otherwise, as an account party or applicant under acceptance, letter of credit, surety bond or similar facilities, (g) all obligations of such Person, contingent or otherwise, to purchase, redeem, retire or otherwise acquire for value any Capital Stock of such Person, (h) all Mandatory Redeemable Stock of such Person, (i) all Guarantee Obligations of such Person in respect of obligations of the kind referred to in clauses (a) through (h) above, (j) all obligations of the kind referred to in clauses (a) through (i) above secured by (or for which the holder of such obligation has an existing right, contingent or otherwise, to be secured by) any Lien on Property (including, without limitation, accounts and contract rights) owned by such Person, whether or not such Person has assumed or become liable for the payment of such obligation and (k) for the purposes of Section 8(e)only, all obligations of such Person in respect of Hedge Agreements.  The Indebtedness of any Person shall include the Indebtedness of any other entity (including any partnership in which such Person is a general partner) to the extent such Person is liable therefor as a result of such Person’s ownership interest in or other relationship with such entity, except to the extent the terms of such Indebtedness expressly provide that such Person is not liable therefor.

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“Indemnified Liabilities”:  as defined in Section 10.6.

“Indemnitee”:  as defined in Section 10.6.

“Indentures”:  collectively, the Montana First Mortgage Indenture and the South Dakota First Mortgage Indenture.

“Insolvency”:  with respect to any Multiemployer Plan, the condition that such Plan is insolvent within the meaning of Section 4245 of ERISA.

“Insolvent”:  pertaining to a condition of Insolvency.

“Intellectual Property”:  the collective reference to all rights, priorities and privileges relating to intellectual property, whether arising under United States, multinational or foreign laws or otherwise, including, without limitation, copyrights, copyright licenses, patents, patent licenses, trademarks, trademark licenses, technology, know-how and processes, and all rights to sue at law or in equity for any infringement or other impairment thereof, including the right to receive all proceeds and damages therefrom.

“Interest Payment Date”:  (a) as to any Base Rate Loan, the last day of each March, June, September and December to occur while such Loan is outstanding and the final maturity date of such Loan, (b) as to any Eurodollar Loan having an Interest Period of three months or shorter, the last day of such Interest Period, (c) as to any Eurodollar Loan having an Interest Period longer than three months, each day that is three months, or a whole multiple thereof, after the first day of such Interest Period and the last day of such Interest Period and (d) as to any Loan (other than any Revolving Credit Loan that is a Base Rate Loan and any Swing Line Loan), the date of any repayment or prepayment made in respect thereof.

“Interest Period”:  as to any Eurodollar Loan, (a) initially, the period commencing on the borrowing or conversion date, as the case may be, with respect to such Eurodollar Loan and ending one, two, three or six or (with the consent of all Lenders under the relevant Facility, as determined by such Lenders in their sole discretion) nine or twelve months thereafter, as selected by the Borrower in its notice of borrowing or notice of conversion, as the case may be, given with respect thereto; and (b) thereafter, each period commencing on the last day of the next preceding Interest Period applicable to such Eurodollar Loan and ending one, two, three or six or (with the consent of all Lenders under the relevant Facility, as determined by such Lenders in their sole discretion) nine or twelve months thereafter, as selected by the Borrower by irrevocable notice to the Administrative Agent not later than 11:00 A.M., New York City time, on the date that is three Business Days prior to the last day of the then current Interest Period with respect thereto; provided that, all of the foregoing provisions relating to Interest Periods are subject to the following:

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

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(2)           the  Borrower may not select an Interest Period that would extend beyond the Revolving Credit Termination Date or beyond the date final payment is due on the Term Loans, as applicable; and

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

“Investments”:  as defined in Section 7.7.

“Issuing Lender”:  Deutsche Bank AG Cayman Islands Branch or any affiliate thereof, or any Revolving Credit Lender or any affiliate thereof from time to time designated by the Borrower as an Issuing Lender with the consent of such Revolving Credit Lender and the Administrative Agent.

“L/C Commitment”:  an amount equal to the Total Revolving Credit Commitments.

“L/C Fee Payment Date”:  the last day of each March, June, September and December, commencing on December 31, 2004, and the last day of the Revolving Credit Commitment Period.

“L/C Obligations”:  at any time, an amount equal to the sum of (a) the aggregate then undrawn and unexpired amount of the then outstanding Letters of Credit and (b) the aggregate amount of drawings under Letters of Credit that have not then been reimbursed pursuant to Section 3.5.

“L/C Participants”:  with respect to any Letter of Credit, the collective reference to all the Revolving Credit Lenders other than the Issuing Lender that issued such letter of Credit.

“L/C Supportable Obligations”:  payment obligations of the Borrower and its Wholly Owned Subsidiaries and the Excluded Subsidiaries as permitted pursuant to Section 4.16.

“Lehman Entity”: any of Lehman Commercial Paper Inc. or any of its affiliates (including Syndicated Loan Funding Trust).

“Lender Addendum”:  with respect to any initial Lender, a Lender Addendum, substantially in the form of Exhibit G, to be executed and delivered by such Lender on the Closing Date as provided in Section 10.17.

“Lender Default”:  (i) the refusal of a Lender to comply with any of its obligations under this Agreement, (ii) a Lender having notified the Administrative Agent and/or the Borrower that it does not intend to comply with its obligations under this Agreement or (iii) the appointment of a receiver or a conservator with respect to such Lender at the direction or the request of any regulatory agency or authority.

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“Lenders”:  as defined in the preamble hereto.

“Letters of Credit”:  as defined in Section 3.1(a).

“Lien”:  any mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), charge or other security interest or any preference, priority or other security agreement or preferential arrangement of any kind or nature whatsoever (including, without limitation, any conditional sale or other title retention agreement and any capital lease having substantially the same economic effect as any of the foregoing).

“Loan”:  any loan made by any Lender pursuant to this Agreement.

“Loan Documents”:  collectively, this Agreement, the Security Documents, the Applications and the Notes.

“Majority Facility Lenders”:  with respect to any Facility, the holders (other than Defaulting Lenders ) of more than 50% of the aggregate unpaid principal amount of the Term Loans or the Total Revolving Extensions of Credit, as the case may be, outstanding under such Facility (or, in the case of the Revolving Credit Facility, prior to any termination of the Revolving Credit Commitments, the holders of more than 50% of the Total Revolving Credit Commitments), in each case excluding the aggregate Term Loans and Commitments of, and Revolving Extensions of Credit by, Defaulting Lenders.

“Majority Revolving Credit Facility Lenders”:  the Majority Facility Lenders in respect of the Revolving Credit Facility.

“Mandatory Redeemable Stock”:  with respect to any Person, any share of such Person’s Capital Stock, to the extent that it is (a) redeemable, payable or required to be purchased or otherwise retired or extinguished, or convertible into any Indebtedness or other liability, obligation, covenant or duty of or binding upon, or any term or condition to be observed by or binding upon such Person or any of its assets, (i) at a fixed or determinable date, whether by operation of a sinking fund or otherwise, (ii) at the option of any other Person or (iii) upon the occurrence of a condition not solely within the control of such Person such as a redemption required to be made utilizing future earnings, or (b) convertible into Capital Stock which has the features set forth in clause (a).

“Material Adverse Effect”:  a material adverse effect on (a) the business, assets, property, operations, condition (financial or otherwise) or prospects of the Borrower and its Subsidiaries taken as a whole, (b) the validity or enforceability of this Agreement or any of the other Loan Documents or either Indenture or the rights or remedies of the Agents or the Lenders hereunder or thereunder (or the Trustee under an Indenture), (c) the property (taken as a whole) subject to the Lien of an Indenture, or (d) the perfection, priority or enforceability of the Lien of the Montana First Mortgage Indenture, the South Dakota Indenture or any other Security Document.

“Materials of Environmental Concern”:  any gasoline or petroleum (including crude oil or any fraction thereof) or petroleum products, polychlorinated biphenyls, urea-formaldehyde insulation, asbestos, pollutants, contaminants, radioactivity, and any other

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substances or forces of any kind, whether or not any such substance or force is defined as hazardous or toxic under any Environmental Law, that is regulated pursuant to or could give rise to liability under any Environmental Law.

“Montana First Mortgage Indenture”:  the Mortgage and Deed of Trust dated October 1, 1945 from the Borrower (as successor to Montana Power) to the trustees named therein, as supplemented and amended to the date hereof.

“Montana Power”:  The Montana Power, L.L.C., a Montana limited liability company, acquired by the Borrower on February 15, 2002.

“Montana Utility Business”:  the regulated electric and natural gas assets and businesses owned and operated by the Borrower in the State of Montana or otherwise subject to the Lien of the Montana First Mortgage Indenture.

“Moody’s”:  Moody’s Investor Service, Inc.

“Multiemployer Plan”:  a Plan that is a multiemployer plan as defined in Section 4001(a)(3) of ERISA.

“Net Cash Proceeds”:  (a) in connection with any Asset Sale or any Recovery Event, the proceeds thereof in the form of cash and Cash Equivalents (including any such proceeds received by way of deferred payment of principal pursuant to a note or installment receivable or purchase price adjustment receivable or otherwise, but only as and when received) of such Asset Sale or Recovery Event, net of attorneys’ fees, accountants’ fees, investment banking and underwriting fees, amounts required to be applied to the repayment of Indebtedness secured by a Lien expressly permitted hereunder on any asset which is the subject of such Asset Sale or Recovery Event (other than any Lien pursuant to a Security Document), the net present value of any amounts required to be returned to rate payers in the form of rate reductions or as otherwise required by any Governmental Authority, and other fees and expenses actually incurred in connection therewith and net of taxes paid or reasonably estimated to be payable as a result thereof (after taking into account any available tax credits or deductions and any tax sharing arrangements, but not taking into account any net operating losses available to the Borrower); provided that “Net Cash Proceeds” shall not include any proceeds to the extent such proceeds are (and remain) subject to the Lien of an Indenture and (b) in connection with any issuance or sale of equity securities or debt securities or instruments or the incurrence of loans, the cash proceeds received from such issuance or incurrence, net of attorneys’ fees, investment banking and underwriting fees, accountants’ fees, underwriting discounts and commissions and other fees and expenses actually incurred in connection therewith.  For the avoidance of doubt, solely for purposes of calculating “Net Cash Proceeds,” (x) any net cash proceeds which were excluded as being subject to the Lien of an Indenture shall become “Net Cash Proceeds” upon and to extent withdrawn from the Lien of such Indenture, (y) with respect to the determination of whether amounts are required to be applied to the repayment of Indebtedness, if the Borrower is required to use any amount to prepay Indebtedness pursuant to the terms of any Indebtedness (including without limitation the Senior Note Indenture) but has the option, in lieu of prepaying (or offering to prepay) such Indebtedness, to prepay other Indebtedness, then the Borrower shall be deemed to have exercised such option to prepay the Loans (it being understood that the

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application of Net Cash Proceeds in accordance with the terms hereof shall not be limited by such deemed exercise) and (z) any net cash proceeds which, pursuant to the terms of such Indebtedness (including without limitation the Senior Note Indenture), are required to be offered to the holders thereof as a prepayment of such Indebtedness shall become “Net Cash Proceeds” upon and to the extent such holders reject such offer.

“Netexit”:  collectively, Netexit, Inc. (f/k/a Expanets, Inc.), a Delaware corporation and its Subsidiaries.

“Non-Excluded Taxes”:  as defined in Section 2.20(a).

“Non-Recourse Debt”:  Indebtedness as to which the Borrower has no direct or indirect liability whether as primary obligor, guarantor, surety, provider of collateral security or through any other right or arrangement of any nature (including any election by the holder of such indebtedness) providing direct or indirect assurance of payment or performance of any such obligations in whole or in part.

“Non-U.S. Lender”:  as defined in Section 2.20(d).

“Note”:  any promissory note evidencing any Loan.

“Obligations”:  the unpaid principal of and interest on (including, without limitation, interest accruing after the maturity of the Loans and Reimbursement Obligations and interest accruing after the filing of any petition in bankruptcy, or the commencement of any insolvency, reorganization or like proceeding, relating to the Borrower, whether or not a claim for post-filing or post-petition interest is allowed in such proceeding) the Loans, the Reimbursement Obligations and all other obligations and liabilities of the Borrower to the Administrative Agent or to any Lender, whether direct or indirect, absolute or contingent, due or to become due, or now existing or hereafter incurred, which may arise under, out of, or in connection with, this Agreement, any other Loan Document, the Letters of Credit, or any other document made, delivered or given in connection herewith or therewith, whether on account of principal, interest, reimbursement obligations, fees, indemnities, costs, expenses (including, without limitation, all fees, charges and disbursements of counsel to the Administrative Agent or to any Lender that are required to be paid by the Borrower pursuant hereto) or otherwise.

“Originators” means the Borrower and/or any of its Subsidiaries in their respective capacities as parties to any Receivables Purchase Documents, as sellers or transferors of any Receivables and Related Security in connection with a Permitted Receivables Transfer.

“Other Taxes”:  any and all present or future stamp or documentary taxes or any other excise or property taxes, charges or similar levies arising from any payment made hereunder or from the execution, delivery or enforcement of, or otherwise with respect to, this Agreement or any other Loan Document.

“Participant”:  as defined in Section 10.7(b).

“Participation Amount”:  as defined in Section 3.4(b).

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“Payment Office”:  the office specified from time to time by the Administrative Agent as its payment office by notice to the Borrower and the Lenders.

“PBGC”:  the Pension Benefit Guaranty Corporation established pursuant to Subtitle A of Title IV of ERISA (or any successor).

“Permitted Acquisition”:  any Acquisition made by the Borrower provided that: (a) as of the date of such Acquisition, no Default or Event of Default shall have occurred and be continuing or would result from such Acquisition or from the incurrence or assumption of any Indebtedness in connection with such Acquisition; (b) in the case of a merger, consolidation or Acquisition of Capital Stock, prior to the date of such Acquisition, such Acquisition shall have been approved by the board of directors and, if applicable, the shareholders of the Person being acquired in connection with such Acquisition and no claim or challenge has been asserted or threatened by any shareholder or director of such Person which could reasonably be expected to have a material adverse effect on such Acquisition or a Material Adverse Effect; (c) as of the date of any such Acquisition, all material consents, authorizations, approvals, filings and notices required in connection with such Acquisition shall have been obtained or made (and remain in full force and effect); (d) any such Acquisition is an Acquisition of the assets or Capital Stock of a Person engaged in the regulated electric or natural gas utility business in the United States; (e) the aggregate consideration (including cash consideration and the fair value of any non-cash consideration and Indebtedness assumed) for such Acquisition is not greater than the fair market value thereof; (f) after giving effect to such Acquisition, the sum of cash on hand of the Borrower plus aggregate Available Revolving Credit Commitments hereunder shall be at least $50 million; and (g) without limiting the generality of the foregoing, (i) if as of the date of any such Acquisition the Facilities shall not be rated at least Baa3 (stable outlook) and BBB- (stable outlook) by Moody’s and Standard & Poor’s, respectively, the Consolidated Interest Coverage Ratio of the Borrower after giving effect to such Acquisition, calculated on a pro forma basis as of the end of the quarter most recently ended prior to the date of such Acquisition and for the four fiscal quarters then ending, shall be equal to or better than the Consolidated Interest Coverage Ratio of the Borrower prior to giving effect to such Acquisition for such period and (ii) after giving effect to such Acquisition, the Borrower shall be in compliance with the provisions of Section 7.1 (or, in the case of any Permitted Acquisition consummated on or prior to March 31, 2005, in compliance with the financial covenants applicable to FQ1 2005 (and thereafter) set forth in Section 7.1), calculated on a pro forma basis as of the end of the quarter most recently ended prior to the date of such Acquisition and for the four fiscal quarters then ending (and, if the aggregate consideration (including cash consideration and the fair value of any non-cash consideration and Indebtedness assumed) for such Acquisition exceeds $25 million, the Borrower shall have delivered to the Administrative Agent a Compliance Certificate demonstrating such pro forma compliance); provided, however, that any Acquisition by the Borrower or any of its Subsidiaries of all or a portion of Colstrip shall be a Permitted Acquisition without regard to any of the foregoing requirements other than as set forth in clause (a) and (c) of this definition.

“Permitted Receivables Transfer” means (i) a sale or other transfer by an Originator to a SPV or any other Person of Receivables and Related Security for fair market value and without recourse (except for limited recourse typical of such structured finance transactions), and/or (ii) a sale or other transfer by an Originator or a SPV to (a) purchasers of or other investors in such Receivables and Related Security or (b) any other Person (including a

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SPV) in a transaction in which purchasers or other investors purchase or are otherwise transferred such Receivables and Related Security in each case pursuant to and in accordance with the terms of the Receivables Purchase Documents; provided, that Receivables Facility Attributed Indebtedness incurred in connection with the Receivables Purchase Documents does not exceed $70,000,000 in the aggregate at any time.

“Person”:  an individual, partnership, corporation, limited liability company, business trust, joint stock company, trust, unincorporated association, joint venture, Governmental Authority or other entity of whatever nature.

“Plan”:  at a particular time, any employee benefit plan that is covered by ERISA and in respect of which the Borrower or a Commonly Controlled Entity is (or, if such plan were terminated at such time, would under Section 4069 of ERISA be deemed to be) an “employer” as defined in Section 3(5) of ERISA.

“Plan of Reorganization”:  as defined in the recitals hereto.

“Pro Forma Balance Sheet”:  as defined in Section 4.1.

“Property”:  any right or interest in or to property of any kind whatsoever, whether real, personal or mixed and whether tangible or intangible, including, without limitation, Capital Stock.

“QF Liabilities”:  the balance sheet liabilities of the Borrower arising under agreements existing on the date hereof between the Borrower and any “qualifying cogeneration facility” as that term is defined in Section 3(18)(B) of the Federal Power Act.

“Qualified Counterparty”:  with respect to any Specified Hedge Agreement, any counterparty thereto that, at the time such Specified Hedge Agreement was entered into, was a Lender or an affiliate of a Lender.

“Receivable(s)”:  all of the applicable Originator’s or SPV’s presently existing and hereafter arising or acquired accounts, accounts receivable, and all present and future rights of such Originator or SPV to payment for goods sold or leased or for services rendered (except those evidenced by instruments or chattel paper), whether or not they have been earned by performance, and all rights in any merchandise or goods which any of the same may represent, and all rights, title, security and guaranties with respect to each of the foregoing, including, without limitation, any right of stoppage in transit.

“Receivables and Related Security”:  the Receivables and the related security and collections with respect thereto which are sold or transferred by any Originator or SPV in connection with any Permitted Receivables Transfer.

“Receivables Facility Attributed Indebtedness”:  the amount of obligations outstanding under a receivables purchase facility on any date of determination that would be characterized as principal if such facility were structured as a secured lending transaction rather than as a purchase.

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“Receivables Purchase Documents”:  any series of receivables purchase or sale agreements generally consistent with terms contained in comparable structured finance transactions pursuant to which an Originator or Originators sell or transfer to SPVs all of their respective right, title and interest in and to certain Receivables and Related Security for further sale or transfer to other purchasers of or investors in such assets (and the other documents, instruments and agreements executed in connection therewith), as any such agreements may be amended, restated, supplemented or otherwise modified from time to time, or any replacement or substitution therefor.

“Recovery Event”:  any settlement of or payment in respect of any property or casualty insurance claim or any condemnation proceeding relating to any asset of the Borrower or any of its Subsidiaries.

“Refunded Swing Line Loans”:  as defined in Section 2.7.

“Refunding Date”:  as defined in Section 2.7.

“Register”:  as defined in Section 10.7(d).

“Regulation U”:  Regulation U of the Board as in effect from time to time.

“Reimbursement Obligation”:  the obligation of the Borrower to reimburse each Issuing Lender pursuant to Section 3.5 for amounts drawn under Letters of Credit issued by such Issuing Lender.

“Reinvestment Deferred Amount”:  with respect to any Reinvestment Event, the aggregate Net Cash Proceeds received by the Borrower or any of its Subsidiaries in connection therewith that are not applied to prepay the Term Loans or the Revolving Credit Commitments pursuant to 2.12(b) as a result of the delivery of a Reinvestment Notice.

“Reinvestment Event”:  any Asset Sale or Recovery Event in respect of which the Borrower has delivered a Reinvestment Notice.

“Reinvestment Notice”:  a written notice executed by a Responsible Officer stating that no Default or Event of Default has occurred and is continuing and that the Borrower (directly or, if the assets which are the subject of the applicable Reinvestment Event were held by a Subsidiary, indirectly through a Subsidiary) intends and expects to use all or a specified portion of the Net Cash Proceeds of (i) a Recovery Event to acquire or repair assets useful in its business, (ii) a Disposition permitted under Section 7.5(k) to reinvest such amounts in the Montana Utility Business (if such Disposition relates to assets under the Montana Indenture) or the South Dakota Utility Business (if such Disposition relates to assets under the South Dakota Indenture) or (iii) a Disposition permitted under Section 7.5(f), (g) or (i) to reinvest such amounts in the Montana Utility Business or the South Dakota Utility Business, to pay or prepay then existing Indebtedness or settle then existing claims of the Borrower, or to pay regular quarterly cash dividends in respect of the Borrower’s common stock, in accordance with Section 7.6(d).

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“Reinvestment Prepayment Amount”:  with respect to any Reinvestment Event, the Reinvestment Deferred Amount relating thereto less any amount expended prior to the relevant Reinvestment Prepayment Date in accordance with the Reinvestment Notice with respect thereto.  If pursuant to clause (x) of the last sentence of the definition of “Net Cash Proceeds,” any net cash proceeds withdrawn from the Lien of an Indenture become “Net Cash Proceeds,” such proceeds shall be deemed to be expended prior to the applicable Reinvestment Prepayment Date if withdrawn from such Indenture on the basis of Property Additions (as such term is defined in such Indenture) acquired within 365 of such withdrawal (i) other than Property Additions made in the ordinary course of business or (ii) specifically made for the purpose of obtaining such withdrawal of net cash proceeds.

“Reinvestment Prepayment Date”:  with respect to any Reinvestment Event, the earlier of (a) the date occurring one year after such Reinvestment Event (or, if (i) the Borrower is not able to obtain all of the consents or approvals of a Governmental Authority within such period determined by the Borrower to be necessary to make such proposed reinvestment (despite using commercially reasonable efforts to do so) and (ii) the terms of the Senior Notes will not then or thereafter require any portion of such proceeds to be used to prepay Indebtedness or offered as prepayment of the Senior Notes, then upon the Administrative Agent’s receipt (at any time within such one year period) of written notice from the Borrower to such effect (which notice shall set forth in reasonable detail such consents and the efforts made to date to obtain them), the date occurring 18 months after such Reinvestment Event) and (b) the date on which the Borrower shall have determined not to, or shall have otherwise ceased to, use all or any portion of the relevant Reinvestment Deferred Amount in accordance with the Reinvestment Notice with respect thereto.  For purposes of calculating the one year (or 18 month) period, the “Reinvestment Event” shall be deemed to have occurred on the date such Net Cash Proceeds are received by the Borrower (by way of deferred payment of principal pursuant to a note or installment receivable or purchase price adjustment receivable or otherwise).

“Related Fund”:  with respect to any Lender, any fund that (x) invests in commercial loans and (y) is managed or advised by the same investment advisor as such Lender, by such Lender or by an Affiliate of such Lender.

“Reorganization”:  with respect to any Multiemployer Plan, the condition that such plan is in reorganization within the meaning of Section 4241 of ERISA.

“Reportable Event”:  any of the events set forth in Section 4043(c) of ERISA, other than those events as to which the thirty day notice period is waived under subsections .27, .28, .29, .30, .31, .32, .34 or .35 of PBGC Reg. § 4043.

“Required Lenders”:  at any time, the holders (other than Defaulting Lenders) of more than 50% of (a) until the Closing Date, the Commitments and (b) thereafter, the sum of (i) the aggregate unpaid principal amount of the Term Loans then outstanding and (ii) the Total Revolving Credit Commitments then in effect or, if the Revolving Credit Commitments have been terminated, the Total Revolving Extensions of Credit then outstanding, in each case excluding the aggregate Commitments of, and Revolving Extensions of Credit by, Defaulting Lenders.

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“Required Prepayment Lenders”:  the Majority Facility Lenders in respect of each Facility.

“Requirement of Law”:  as to any Person, the Certificate of Incorporation and By-Laws or other organizational or governing documents of such Person, and any law, treaty, rule or regulation or determination of an arbitrator or a court or other Governmental Authority, in each case applicable to or binding upon such Person or any of its Property or to which such Person or any of its Property is subject.

“Responsible Officer”:  as to any Person, the chief executive officer, president or chief financial officer of such Person, but in any event, with respect to financial matters, the chief financial officer or treasurer of such Person, or any other officer of such Person designated as a Responsible Officer by any one of the foregoing.

“Restricted Payments”:  as defined in Section 7.6.

“Revolving Credit Commitment”:  as to any Lender, the obligation of such Lender, if any, to make Revolving Credit Loans and participate in Swing Line Loans and Letters of Credit, in an aggregate principal and/or face amount not to exceed the amount set forth under the heading “Revolving Credit Commitment” opposite such Lender’s name on Schedule 1 to the Lender Addendum delivered by such Lender, or, as the case may be, in the assignment and acceptance pursuant to which such Lender became a party hereto, as the same may be changed from time to time pursuant to the terms hereof.  The original aggregate amount of the Total Revolving Credit Commitments is $125,000,000.

“Revolving Credit Commitment Period”:  the period from and including the Closing Date to the Revolving Credit Termination Date.

“Revolving Credit Facility”:  as defined in the definition of “Facility” in this Section 1.1.

“Revolving Credit First Mortgage Bonds”:  as defined in Section 5.1(h).

“Revolving Credit Lender”:  each Lender that has a Revolving Credit Commitment or that is the holder of Revolving Credit Loans.

“Revolving Credit Loans”:  as defined in Section 2.4.

“Revolving Credit Note”:  as defined in Section 2.8.

“Revolving Credit Percentage”:  as to any Revolving Credit Lender at any time, the percentage which such Lender’s Revolving Credit Commitment then constitutes of the Total Revolving Credit Commitments (or, at any time after the Revolving Credit Commitments shall have expired or terminated, the percentage which the aggregate amount of such Lender’s Revolving Extensions of Credit then outstanding constitutes of the Total Revolving Extensions of Credit then outstanding).

“Revolving Credit Termination Date”:  the fifth anniversary of the Closing Date.

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“Revolving Extensions of Credit”:  as to any Revolving Credit Lender at any time, an amount equal to the sum of (a) the aggregate principal amount of all Revolving Credit Loans made by such Lender then outstanding, (b) such Lender’s Revolving Credit Percentage of the L/C Obligations then outstanding and (c) such Lender’s Revolving Credit Percentage of the aggregate principal amount of Swing Line Loans then outstanding.

“SEC”:  the Securities and Exchange Commission (or successors thereto or an analogous Governmental Authority).

“SEC Reports”:  the publicly available (unredacted) portion of all reports filed by the Borrower with the SEC on Form 10-K, Form 10-Q or Form 8-K or any successor form.

“Security Documents”:  the collective reference to the Bond Delivery Agreement, the Supplemental Indentures and all other security documents hereafter delivered to the Administrative Agent or the Collateral Agent granting a Lien on any Property of any Person to secure the obligations and liabilities of the Borrower under any Loan Document.

“Senior Notes”:  the Borrower’s Senior Secured Notes, 5.875% Series A due 2014 of the Borrower issued under the Senior Note Indenture on the Closing Date and any Senior Secured Notes, 5.875% Exchange Series A due 2014 registered under the Securities Act of 1933 and issued in exchange for such notes as contemplated by a registration rights agreement executed and delivered on the Closing Date.

“Senior Note Indenture”:  the Indenture, dated as of November 1, 2004, by the Borrower, as issuer, in favor of U.S. Bank National Association, as trustee, as supplemented by that certain Supplemental Indenture, dated as of November 1, 2004, by the Borrower in favor of U.S. Bank National Association.

“Single Employer Plan”:  any Plan that is covered by Title IV of ERISA, but which is not a Multiemployer Plan.

“Solvent”:  with respect to any Person, as of any date of determination, (a) the amount of the “present fair saleable value” of the assets of such Person will, as of such date, exceed the amount of all “liabilities of such Person, contingent or otherwise”, as of such date, as such quoted terms are determined in accordance with applicable federal and state laws governing determinations of the insolvency of debtors, (b) the present fair saleable value of the assets of such Person will, as of such date, be greater than the amount that will be required to pay the liability of such Person on its debts as such debts become absolute and matured, (c) such Person will not have, as of such date, an unreasonably small amount of capital with which to conduct its business, and (d) such Person will be able to pay its debts as they mature.  For purposes of this definition, (i) “debt” means liability on a “claim”, and (ii) “claim” means any (x) right to payment, whether or not such a right is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured or unsecured or (y) right to an equitable remedy for breach of performance if such breach gives rise to a right to payment, whether or not such right to an equitable remedy is reduced to judgment, fixed, contingent, matured or unmatured, disputed, undisputed, secured or unsecured.

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“South Dakota First Mortgage Indenture”:  the General Mortgage Indenture and Deed of Trust dated as of August 1, 1993 between the Borrower and The Chase Manhattan Bank, as trustee, as supplemented and amended to the date hereof.

“South Dakota Utility Business”:  the regulated electric and natural gas assets and businesses owned and operated by the Borrower in the States of South Dakota and Nebraska and all of the Borrower’s other assets that are subject to the Lien of the South Dakota First Mortgage Indenture (which consists principally, as of the date hereof, of the shared ownership interests in electric generation facilities located in the States of North Dakota and Iowa).

“Specified Hedge Agreement”:  any Hedge Agreement entered into by the Borrower and any Qualified Counterparty.

“SPV”:  any special purpose entity established for the purpose of purchasing receivables in connection with a receivables securitization transaction permitted under the terms of this Agreement.

“Standard & Poor’s”:  Standard & Poor’s Rating Group, a division of The McGraw-Hill Companies, Inc.

“Subsidiary”:  as to any Person, a corporation, partnership, limited liability company or other entity of which shares of stock or other ownership interests having ordinary voting power (other than stock or such other ownership interests having such power only by reason of the happening of a contingency) to elect a majority of the board of directors or other managers of such corporation, partnership or other entity are at the time owned, or the management of which is otherwise controlled, directly or indirectly through one or more intermediaries, or both, by such Person.  Unless otherwise qualified, all references to a “Subsidiary” or to “Subsidiaries” in this Agreement shall refer to a Subsidiary or Subsidiaries of the Borrower; provided that in no event shall any Excluded Subsidiary be deemed a Subsidiary of the Borrower.

“Supplemental Indentures”:  collectively the supplemental indentures to the Indentures pursuant to which, among other things, the First Mortgage Bonds are issued.  The Supplemental Indentures are sometimes called, as applicable, the Montana Supplemental Indenture and the South Dakota Supplemental Indenture herein.

“Swing Line Commitment”:  the obligation of the Swing Line Lender to make Swing Line Loans pursuant to Section 2.6 in an aggregate principal amount at any one time outstanding not to exceed $10,000,000.

“Swing Line Lender”:  Lehman Commercial Paper Inc., in its capacity as the lender of Swing Line Loans.

“Swing Line Loans”:  as defined in Section 2.6.

“Swing Line Note”: as defined in Section 2.8.

“Swing Line Participation Amount”:  as defined in Section 2.7.

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“Syndication Agent”:  as defined in the preamble hereto.

“Term Loan Facility”:  as defined in the definition of “Facility” in this Section 1.1.

“Term Loan Lenders”:  each Lender that has a Term Loan Commitment or is the holder of a Term Loan.

“Term Loans”:  as defined in Section 2.1.

“Term Note”:  as defined in Section 2.8(e).

“Term Loan Commitment”:  as to any Lender, the obligation of such Lender, if any, to make a Term Loan to the Borrower hereunder in a principal amount not to exceed the amount set forth under the heading “Term Loan Commitment” opposite such Lender’s name on Schedule 1 to the Lender Addendum delivered by such Lender, or, as the case may be, in the Assignment and Acceptance pursuant to which such Lender became a party hereto, as the same may be changed from time to time pursuant to the terms hereof.  The original aggregate amount of the Term Loan Commitments is $100,000,000.

“Term Loan First Mortgage Bonds”:  as defined in Section 5.1(h).

“Term Loan Percentage”:  as to any Term Loan Lender at any time, the percentage which such Lender’s Term Loan Commitment then constitutes of the aggregate Term Loan Commitments (or, at any time after the Closing Date, the percentage which the aggregate principal amount of such Lender’s Term Loans then outstanding constitutes of the aggregate principal amount of the Term Loans then outstanding).

“Total Revolving Credit Commitments”:  at any time, the aggregate amount of the Revolving Credit Commitments then in effect.

“Total Revolving Extensions of Credit”:  at any time, the aggregate amount of the Revolving Extensions of Credit of the Revolving Credit Lenders outstanding at such time.

“Transferee”:  as defined in Section 10.15.

“Type”:  as to any Loan, its nature as a Base Rate Loan or a Eurodollar Loan.

“Utility Business”:  the regulated electric and natural gas utility business and operations of the Borrower and its Subsidiaries.

“Wholly Owned Subsidiary”:  as to any Person, any other Person all of the Capital Stock of which (other than directors’ qualifying shares required by law) is owned by such Person directly and/or through other Wholly Owned Subsidiaries.  For the avoidance of doubt, no Excluded Subsidiary shall be deemed a Wholly Owned Subsidiary of the Borrower for purposes hereof.

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1.2           Other Definitional Provisions.  (a)  Unless otherwise specified therein, all terms defined in this Agreement shall have the defined meanings when used in the other Loan Documents or any certificate or other document made or delivered pursuant hereto or thereto.

(b)           As used herein and in the other Loan Documents, and any certificate or other document made or delivered pursuant hereto or thereto, accounting terms relating to the Borrower and its Subsidiaries not defined in Section 1.1 and accounting terms partly defined in Section 1.1, to the extent not defined, shall have the respective meanings given to them under GAAP.

(c)           The words “hereof”, “herein” and “hereunder” and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement, and Section, Schedule and Exhibit references are to this Agreement unless otherwise specified.

(d)           The meanings given to terms defined herein shall be equally applicable to both the singular and plural forms of such terms.

(e)           All calculations of financial ratios set forth in Section 7.1 shall be calculated to the same number of decimal places as the relevant ratios are expressed in and shall be rounded upward if the number in the decimal place immediately following the last calculated decimal place is five or greater.  For example, if the relevant ratio is to be calculated to the hundredth decimal place and the calculation of the ratio is 5.126, the ratio will be rounded up to 5.13.

(f)            The words “include,” “includes” and “including” shall be deemed to be followed by the phrase “without limitation”.  The word “or” shall not be exclusive.  The word “will” shall be construed to have the same meaning and effect as the word “shall”.

(g)           Unless the context requires otherwise (i) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein), (ii) any reference herein to any Person shall be construed to include such Person’s successors and assigns, and (iii) the words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights.

SECTION 2.           AMOUNT AND TERMS OF COMMITMENTS

2.1           Term Loan Commitments.  Subject to the terms and conditions hereof, the Term Loan Lenders severally agree to make term loans (each, a “Term Loan”) to the Borrower on the Closing Date in an amount for each Term Loan Lender (as requested by the Borrower in accordance with the terms hereof) up to but not exceeding the amount of the Term Loan Commitment of such Lender.  The Term Loans may from time to time be Eurodollar Loans or Base Rate Loans, as determined by the Borrower and notified to the Administrative Agent in accordance with Sections 2.2 and 2.13.

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2.2           Procedure for Term Loan Borrowing.  The Borrower shall deliver to the Administrative Agent a Borrowing Notice (which Borrowing Notice must be received by the Administrative Agent prior to 10:00 A.M., New York City time, one Business Day prior to the anticipated Closing Date) requesting that the Term Loan Lenders make the Term Loans on the Closing Date.  The Term Loans made on the Closing Date shall initially be Base Rate Loans.  Upon receipt of such Borrowing Notice the Administrative Agent shall promptly notify each Term Loan Lender thereof.  Not later than 12:00 Noon, New York City time, on the Closing Date each Term Loan Lender shall make available to the Administrative Agent at the Funding Office an amount in immediately available funds equal to the Term Loan or Term Loans to be made by such Lender.  The Administrative Agent shall make available to the Borrower the aggregate of the amounts made available to the Administrative Agent by the Term Loan Lenders, in like funds as received by the Administrative Agent.

2.3           Repayment of Term Loans.  On the last day of each March, June, September and December commencing on March 31, 2005, and continuing through and including September 30, 2010, the Borrower shall make quarterly principal payments on the Term Loans, each quarterly payment in an amount equal to one quarter of one percent (0.25%) of the original aggregate principal amount of the Term Loans.  On December 31, 2010, March 31, 2011 and June 30, 2011 the Borrower shall make payments on the Term Loans, each in an amount equal to twenty-three and one-half percent (23.5%) of the original aggregate principal amount of the Term Loans.  On November 1, 2011 the Borrower shall repay the then outstanding aggregate principal amount of the Term Loans, together with accrued and unpaid interest thereon as provided herein.

2.4           Revolving Credit Commitments.  (a)  Subject to the terms and conditions hereof, the Revolving Credit Lenders severally agree to make revolving credit loans (“Revolving Credit Loans”) to the Borrower from time to time during the Revolving Credit Commitment Period in an aggregate principal amount at any one time outstanding for each Revolving Credit Lender which, when added to such Lender’s Revolving Credit Percentage of the sum of (i) the L/C Obligations then outstanding and (ii) the aggregate principal amount of the Swing Line Loans then outstanding, does not exceed the amount of such Lender’s Revolving Credit Commitment.  During the Revolving Credit Commitment Period the Borrower may use the Revolving Credit Commitments by borrowing, prepaying the Revolving Credit Loans in whole or in part, and reborrowing, all in accordance with the terms and conditions hereof.  The Revolving Credit Loans may from time to time be Eurodollar Loans or Base Rate Loans, as determined by the Borrower and notified to the Administrative Agent in accordance with Sections 2.5 and 2.13, provided that no Revolving Credit Loan shall be made as a Eurodollar Loan after the day that is one month prior to the Revolving Credit Termination Date.

(b)           The Borrower shall repay all outstanding Revolving Credit Loans on the Revolving Credit Termination Date.

2.5           Procedure for Revolving Credit Borrowing.  The Borrower may borrow under the Revolving Credit Commitments on any Business Day during the Revolving Credit Commitment Period, provided that the Borrower shall deliver to the Administrative Agent a Borrowing Notice (which Borrowing Notice must be received by the Administrative Agent prior to 12:00 Noon, New York City time, (a) three Business Days prior to the requested Borrowing

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Date, in the case of Eurodollar Loans, or (b) one Business Day prior to the requested Borrowing Date, in the case of Base Rate Loans).  Any Revolving Credit Loans made on the Closing Date shall initially be Base Rate Loans.  Except as provided in Section 2.7 or 3.5, each borrowing of Revolving Credit Loans under the Revolving Credit Commitments shall be in an amount equal to (x) in the case of Base Rate Loans, $1,000,000 or a whole multiple of $100,000 in excess thereof (or, if the then aggregate Available Revolving Credit Commitments are less than $1,000,000, such lesser amount) and (y) in the case of Eurodollar Loans, $5,000,000 or a whole multiple of $1,000,000 in excess thereof.  Upon receipt of any such Borrowing Notice from the Borrower, the Administrative Agent shall promptly notify each Revolving Credit Lender thereof.  Each Revolving Credit Lender will make its Revolving Credit Percentage of the amount of each borrowing of Revolving Credit Loans available to the Administrative Agent for the account of the Borrower at the Funding Office prior to 12:00 Noon, New York City time, on the Borrowing Date requested by the Borrower in funds immediately available to the Administrative Agent.  Such borrowing will then be made available to the Borrower by the Administrative Agent in like funds as received by the Administrative Agent.

2.6           Swing Line Commitment.  (a)  Subject to the terms and conditions hereof, the Swing Line Lender agrees that, during the Revolving Credit Commitment Period, it will make available to the Borrower in the form of swing line loans (“Swing Line Loans”) a portion of the credit otherwise available to the Borrower under the Revolving Credit Commitments; provided that (i) the aggregate principal amount of Swing Line Loans outstanding at any time shall not exceed the Swing Line Commitment then in effect (notwithstanding that the Swing Line Loans outstanding at any time, when aggregated with the Swing Line Lender’s other outstanding Revolving Credit Loans hereunder, may exceed the Swing Line Commitment then in effect or such Swing Line Lender’s Revolving Credit Commitment then in effect) and (ii) the Borrower shall not request, and the Swing Line Lender shall not make, any Swing Line Loan if, after giving effect to the making of such Swing Line Loan, the aggregate amount of the Available Revolving Credit Commitments would be less than zero.  During the Revolving Credit Commitment Period, the Borrower may use the Swing Line Commitment by borrowing, repaying and reborrowing, all in accordance with the terms and conditions hereof.  Swing Line Loans shall be Base Rate Loans only.

(b)           The Borrower shall repay all outstanding Swing Line Loans on the Revolving Credit Termination Date.

2.7           Procedure for Swing Line Borrowing; Refunding of Swing Line Loans.  (a)  The Borrower may borrow under the Swing Line Commitment on any Business Day during the Revolving Credit Commitment Period, provided, the Borrower shall give the Swing Line Lender irrevocable telephonic notice confirmed promptly in writing (which telephonic notice must be received by the Swing Line Lender not later than 1:00 P.M., New York City time, on the proposed Borrowing Date), specifying (i) the amount to be borrowed and (ii) the requested Borrowing Date.  Each borrowing under the Swing Line Commitment shall be in an amount equal to $500,000 or a whole multiple of $100,000 in excess thereof.  Not later than 3:00 P.M., New York City time, on the Borrowing Date specified in the borrowing notice in respect of any Swing Line Loan, the Swing Line Lender shall make available to the Administrative Agent at the Funding Office an amount in immediately available funds equal to the amount of such Swing Line Loan.  The Administrative Agent shall make the proceeds of such Swing Line Loan

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available to the Borrower on such Borrowing Date in like funds as received by the Administrative Agent.

(b)           The Swing Line Lender, at any time and from time to time in its sole and absolute discretion may, on behalf of the Borrower (which hereby irrevocably directs the Swing Line Lender to act on its behalf), on one Business Day’s notice given by the Swing Line Lender no later than 12:00 Noon, New York City time, request each Revolving Credit Lender to make, and each Revolving Credit Lender hereby agrees to make, a Revolving Credit Loan (which shall initially be a Base Rate Loan), in an amount equal to such Revolving Credit Lender’s Revolving Credit Percentage of the aggregate amount of the Swing Line Loans (the “Refunded Swing Line Loans”) outstanding on the date of such notice, to repay the Swing Line Lender.  Each Revolving Credit Lender shall make the amount of such Revolving Credit Loan available to the Administrative Agent at the Funding Office in immediately available funds, not later than 10:00 A.M., New York City time, one Business Day after the date of such notice.  The proceeds of such Revolving Credit Loans shall be made immediately available by the Administrative Agent to the Swing Line Lender for application by the Swing Line Lender to the repayment of the Refunded Swing Line Loans.

(c)           If prior to the time a Revolving Credit Loan would have otherwise been made pursuant to Section 2.7(b), one of the events described in Section 8(f) shall have occurred and be continuing with respect to the Borrower, or if for any other reason, as determined by the Swing Line Lender in its sole discretion, Revolving Credit Loans may not be made as contemplated by Section 2.7(b), each Revolving Credit Lender shall, on the date such Revolving Credit Loan was to have been made pursuant to the notice referred to in Section 2.7(b) (the “Refunding Date”), purchase for cash an undivided participating interest in the then outstanding Swing Line Loans by paying to the Swing Line Lender an amount (the “Swing Line Participation Amount”) equal to (i) such Revolving Credit Lender’s Revolving Credit Percentage times (ii) the sum of the aggregate principal amount of Swing Line Loans then outstanding which were to have been repaid with such Revolving Credit Loans.

(d)           Whenever, at any time after the Swing Line Lender has received from any Revolving Credit Lender such Lender’s Swing Line Participation Amount, the Swing Line Lender receives any payment on account of the Swing Line Loans, the Swing Line Lender will distribute to such Lender its Swing Line Participation Amount (appropriately adjusted, in the case of interest payments, to reflect the period of time during which such Lender’s participating interest was outstanding and funded and, in the case of principal and interest payments, to reflect such Lender’s pro rata portion of such payment if such payment is not sufficient to pay the principal of and interest on all Swing Line Loans then due); provided, however, that in the event that such payment received by the Swing Line Lender is required to be returned, such Revolving Credit Lender will return to the Swing Line Lender any portion thereof previously distributed to it by the Swing Line Lender.

(e)           Each Revolving Credit Lender’s obligation to make the Loans referred to in Section 2.7(b) and to purchase participating interests pursuant to Section 2.7(c) shall be absolute and unconditional and shall not be affected by any circumstance, including, without limitation, (i) any setoff, counterclaim, recoupment, defense or other right which such Revolving Credit Lender or the Borrower may have against the Swing Line Lender, the Borrower or any

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other Person for any reason whatsoever; (ii) the occurrence or continuance of a Default or an Event of Default or the failure to satisfy any of the other conditions specified in Section 5; (iii) any adverse change in the condition (financial or otherwise) of the Borrower; (iv) any breach of this Agreement or any other Loan Document by the Borrower, or any other Revolving Credit Lender; or (v) any other circumstance, happening or event whatsoever, whether or not similar to any of the foregoing.

2.8           Repayment of Loans; Evidence of Debt.  (a)  The Borrower hereby unconditionally promises to pay to the Administrative Agent for the account of the appropriate Revolving Credit Lender or Term Loan Lender, as the case may be, (i) the then unpaid principal amount of each Revolving Credit Loan of such Revolving Credit Lender on the Revolving Credit Termination Date (or on such earlier date on which the Loans become due and payable pursuant to Section 8), (ii) the then unpaid principal amount of each Swing Line Loan of such Swing Line Lender on the Revolving Credit Termination Date (or on such earlier date on which the Loans become due and payable pursuant to Section 8) and (iii) the principal amount of each Term Loan of such Term Loan Lender in installments according to the amortization schedule set forth in Section 2.3 (or on such earlier date on which the Loans become due and payable pursuant to Section 8).  The Borrower hereby further agrees to pay interest on the unpaid principal amount of the Loans from time to time outstanding from the date hereof until payment in full thereof at the rates per annum, and on the dates, set forth in Section 2.15.

(b)           Each Lender shall maintain in accordance with its usual practice an account or accounts evidencing indebtedness of the Borrower to such Lender resulting from each Loan of such Lender from time to time, including the amounts of principal and interest payable and paid to such Lender from time to time under this Agreement.

(c)           The Administrative Agent, on behalf of the Borrower, shall maintain the Register pursuant to Section 10.7(d), and a subaccount therein for each Lender, in which shall be recorded (i) the amount of each Loan made hereunder and any Note evidencing such Loan, the Type of such Loan and each Interest Period applicable thereto, (ii) the amount of any principal or interest due and payable or to become due and payable from the Borrower to each Lender hereunder and (iii) both the amount of any sum received by the Administrative Agent hereunder from the Borrower and each Lender’s share thereof.

(d)           The entries made in the Register and the accounts of each Lender maintained pursuant to Section 2.8(b) shall, to the extent permitted by applicable law, be prima facie evidence of the existence and amounts of the obligations of the Borrower therein recorded; provided, however, that the failure of any Lender or the Administrative Agent to maintain the Register or any such account, or any error therein, shall not in any manner affect the obligation of the Borrower to repay (with applicable interest) the Loans made to the Borrower by such Lender in accordance with the terms of this Agreement.

(e)           The Borrower agrees that, upon its receipt of notice of the request to the Administrative Agent by any Lender, the Borrower will promptly execute and deliver to such Lender a promissory note of the Borrower evidencing any Term Loans, Revolving Credit Loans or Swing Line Loans, as the case may be, of such Lender, substantially in the forms of Exhibit D-1, D-2 or D-3, respectively (a “Term Note”, “Revolving Credit Note” or “Swing Line Note”,

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respectively), with appropriate insertions as to date and then outstanding principal amount; provided, that delivery of Notes shall not be a condition precedent to the occurrence of the Closing Date or the making of the Loans or issuance of Letters of Credit on the Closing Date.

2.9           Commitment Fees, etc.  (a)  The Borrower agrees to pay to the Administrative Agent for the account of each Revolving Credit Lender a commitment fee for the period from and including the Closing Date to the last day of the Revolving Credit Commitment Period, computed at the Commitment Fee Rate on the average daily amount of the Available Revolving Credit Commitment of such Lender during the period for which payment is made, payable quarterly in arrears on the last day of each March, June, September and December and on the Revolving Credit Termination Date, commencing on the first of such dates to occur after the date hereof.

(b)           The Borrower agrees to pay to the Syndication Agent the fees in the amounts and on the dates previously agreed to in the Fee Letter.

(c)           The Borrower agrees to pay to the Administrative Agent the fees in the amounts and on the dates agreed to in the Fee Letter (or otherwise from time to time agreed to in writing by the Borrower and the Administrative Agent).

2.10         Termination or Reduction of Revolving Credit Commitments.  The Borrower shall have the right, upon not less than three Business Days’ notice to the Administrative Agent, without premium or penalty, to terminate the Revolving Credit Commitments or, from time to time, to reduce the aggregate amount of the Revolving Credit Commitments; provided that no such termination or reduction of Revolving Credit Commitments shall be permitted if, after giving effect thereto and to any prepayments of the Revolving Credit Loans and Swing Line Loans made on the effective date thereof, the Total Revolving Extensions of Credit would exceed the Total Revolving Credit Commitments.  Any such reduction shall be in an amount equal to $1,000,000, or a whole multiple thereof, and shall reduce permanently the Revolving Credit Commitments then in effect.

2.11         Optional Prepayments.  The Borrower may at any time and from time to time prepay the Loans, in whole or in part, without premium or penalty (but including breakage costs, if any, pursuant to Section 2.21), upon irrevocable notice delivered to the Administrative Agent no later than 11:00 A.M., New York City time, three Business Days prior thereto in the case of Eurodollar Loans and no later than 11:00 A.M., New York City time, one Business Day prior thereto in the case of Base Rate Loans, which notice shall specify the date and amount of such prepayment, whether such prepayment is of Term Loans or Revolving Credit Loans, and whether such prepayment is of Eurodollar Loans or Base Rate Loans; provided, that (i) if a Eurodollar Loan is prepaid on any day other than the last day of the Interest Period applicable thereto, the Borrower shall also pay any amounts owing pursuant to Section 2.21 and (ii) no prior notice is required for the prepayment of Swing Line Loans.  Upon receipt of any such notice the Administrative Agent shall promptly notify each relevant Lender thereof.  If any such notice is given, the amount specified in such notice shall be due and payable on the date specified therein, together with (except in the case of Revolving Credit Loans that are Base Rate Loans and Swing Line Loans) accrued interest to such date on the amount prepaid.  Partial prepayments of Term Loans and Revolving Credit Loans shall be in an aggregate principal amount of $1,000,000 or a

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whole multiple thereof.  Partial prepayments of Swing Line Loans shall be in an aggregate principal amount of $100,000 or a whole multiple thereof.

2.12         Mandatory Prepayments and Commitment Reductions.  (a)  Unless the Required Prepayment Lenders shall otherwise agree, if any Indebtedness shall be incurred by the Borrower or any of its Subsidiaries (excluding any Indebtedness incurred in accordance with Section 7.2), then on the date of such incurrence, the Term Loans shall be prepaid, and/or the outstanding Revolving Credit Loans shall be repaid, by an amount equal to the amount of the Net Cash Proceeds of such incurrence, as set forth in Section 2.12(d).  The provisions of this Section do not constitute a consent to the incurrence of any Indebtedness by the Borrower or any of its Subsidiaries.

(b)           Unless the Required Prepayment Lenders shall otherwise agree, if the Borrower or any of its Subsidiaries shall receive Net Cash Proceeds from any Asset Sale or Recovery Event then on the fifth Business Day after the date of receipt by the Borrower or such Subsidiary of such Net Cash Proceeds unless a Reinvestment Notice shall be delivered in respect thereof on or prior to such date, the Term Loans shall be prepaid, and/or the outstanding Revolving Credit Loans shall be prepaid, by an amount equal to the amount of such Net Cash Proceeds, as set forth in Section 2.12(d); provided, that, notwithstanding the foregoing, on each Reinvestment Prepayment Date the Term Loans shall be prepaid, and/or the outstanding Revolving Credit Loans shall be prepaid, by an amount equal to the Reinvestment Prepayment Amount with respect to the relevant Reinvestment Event, as set forth in Section 2.12(d).  The provisions of this Section do not constitute a consent to the consummation of any Disposition not permitted by Section 7.5.

(c)           Unless the Required Prepayment Lenders shall otherwise agree, if on any date the Collateral Agent (or Borrower) shall receive any proceeds of principal payments (other than payments deemed made thereunder as a result of actual payments made with respect to the Facilities) made on any First Mortgage Bonds, then on the date of such receipt, the Term Loans shall be prepaid, and/or the outstanding Revolving Credit Loans shall be prepaid, by an amount equal to the amount of such proceeds, as set forth in Section 2.12(d).

(d)           Amounts to be applied in connection with prepayments made pursuant to this Section shall be applied, first, to the prepayment of the Term Loans and, second, to repay any outstanding Revolving Credit Loans (without reducing the Revolving Credit Commitments).

2.13         Conversion and Continuation Options.  (a)  The Borrower may elect from time to time to convert Eurodollar Loans to Base Rate Loans by giving the Administrative Agent at least two Business Days’ prior irrevocable notice of such election, provided that any such conversion of Eurodollar Loans may be made only on the last day of an Interest Period with respect thereto.  The Borrower may elect from time to time to convert Base Rate Loans to Eurodollar Loans by giving the Administrative Agent irrevocable notice of such election no later than 12:00 noon, New York City time, three Business Days prior thereto (which notice shall specify the length of the initial Interest Period therefor), provided that no Base Rate Loan under a particular Facility may be converted into a Eurodollar Loan (i) when any Event of Default has occurred and is continuing and the Administrative Agent has, or the Majority Facility Lenders in respect of such Facility have, determined in its or their sole discretion not to permit such

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conversions or (ii) after the date that is one month prior to the final scheduled termination or maturity date of such Facility.  Upon receipt of any such notice the Administrative Agent shall promptly notify each relevant Lender thereof.

(b)           The Borrower may elect to continue any Eurodollar Loan as such upon the expiration of the then current Interest Period with respect thereto by giving irrevocable notice to the Administrative Agent, in accordance with the applicable provisions of the term “Interest Period” set forth in Section 1.1, of the length of the next Interest Period to be applicable to such Loan, provided that no Eurodollar Loan under a particular Facility may be continued as such (i) when any Event of Default has occurred and is continuing and the Administrative Agent has, or the Majority Facility Lenders in respect of such Facility have, determined in its or their sole discretion not to permit such continuations or (ii) after the date that is one month prior to the final scheduled termination or maturity date of such Facility, and provided, further, that if the Borrower shall fail to give any required notice as described above in this paragraph or if such continuation is not permitted pursuant to the preceding proviso, such Loans shall be converted automatically to Base Rate Loans on the last day of such then expiring Interest Period.  Upon receipt of any such notice the Administrative Agent shall promptly notify each relevant Lender thereof.

2.14         Minimum Amounts and Maximum Number of Eurodollar Tranches.  Notwithstanding anything to the contrary in this Agreement, all borrowings, conversions, continuations and optional prepayments of Eurodollar Loans and all selections of Interest Periods shall be in such amounts and be made pursuant to such elections so that, (a) after giving effect thereto, the aggregate principal amount of the Eurodollar Loans comprising each Eurodollar Tranche shall be equal to $5,000,000 or a whole multiple of $1,000,000 in excess thereof and (b) no more than ten Eurodollar Tranches shall be outstanding at any one time.

2.15         Interest Rates and Payment Dates.  (a)  Each Eurodollar Loan shall bear interest for each day during each Interest Period with respect thereto at a rate per annum equal to the Eurodollar Rate determined for such day plus the Applicable Margin with respect to Eurodollar Loans in effect for such day.

(b)           Each Base Rate Loan shall bear interest for each day on which it is outstanding at a rate per annum equal to the Base Rate in effect for such day plus the Applicable Margin with respect to Base Rate Loans in effect for such day.

(c)           (i) If all or a portion of the principal amount of any Loan or Reimbursement Obligation shall not be paid when due (whether at the stated maturity, by acceleration or otherwise), all outstanding Loans and Reimbursement Obligations (whether or not overdue) (to the extent legally permitted) shall bear interest at a rate per annum that is equal to (x) in the case of the Loans, the rate that would otherwise be applicable thereto pursuant to the foregoing provisions of this Section plus 2% or (y) in the case of Reimbursement Obligations, the rate applicable to Base Rate Loans under the Revolving Credit Facility plus 2%, and (ii) if all or a portion of any interest payable on any Loan or Reimbursement Obligation or any commitment fee or other amount payable hereunder shall not be paid when due (whether at the stated maturity, by acceleration or otherwise), such overdue amount shall bear interest at a rate per annum equal to the rate then applicable to Base Rate Loans under the relevant Facility plus

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2% (or, in the case of any such other amounts that do not relate to a particular Facility, the rate then applicable to Base Rate Loans under the Revolving Credit Facility plus 2%), in each case, with respect to clauses (i) and (ii) above, from the date of such non-payment until such amount is paid in full (after as well as before judgment).

(d)           Interest shall be payable in arrears on each Interest Payment Date, provided that interest accruing pursuant to paragraph (c) of this Section shall be payable from time to time on demand.

2.16         Computation of Interest and Fees.  (a)  Interest, fees and commissions payable pursuant hereto shall be calculated on the basis of a 360-day year for the actual days elapsed, except that, with respect to Base Rate Loans on which interest is calculated on the basis of the Prime Rate, the interest thereon shall be calculated on the basis of a 365- (or 366-, as the case may be) day year for the actual days elapsed.  The Administrative Agent shall as soon as practicable notify the Borrower and the relevant Lenders of each determination of a Eurodollar Rate.  Any change in the interest rate on a Loan resulting from a change in the Base Rate or the Eurocurrency Reserve Requirements shall become effective as of the opening of business on the day on which such change becomes effective.  The Administrative Agent shall as soon as practicable notify the Borrower and the relevant Lenders of the effective date and the amount of each such change in interest rate.

(b)           Each determination of an interest rate by the Administrative Agent pursuant to any provision of this Agreement shall be conclusive and binding on the Borrower and the Lenders in the absence of manifest error.  The Administrative Agent shall, at the request of the Borrower, deliver to the Borrower a statement showing the quotations used by the Administrative Agent in determining any interest rate pursuant to Section 2.15(a).

2.17         Inability to Determine Interest Rate.  If prior to the first day of any Interest Period:

(a)           the Administrative Agent shall have reasonably determined (which determination shall be conclusive and binding upon the Borrower) that, by reason of circumstances affecting the relevant market, adequate and reasonable means do not exist for ascertaining the Eurodollar Rate for such Interest Period, or

(b)           the Administrative Agent shall have received notice from the Majority Facility Lenders in respect of the relevant Facility that the Eurodollar Rate determined or to be determined for such Interest Period will not adequately and fairly reflect the cost to such Lenders (as conclusively certified by such Lenders) of making or maintaining their affected Loans during such Interest Period,

the Administrative Agent shall give telecopy or telephonic notice thereof to the Borrower and the relevant Lenders as soon as practicable thereafter.  If such notice is given (x) any Eurodollar Loans under the relevant Facility requested to be made on the first day of such Interest Period shall be made as Base Rate Loans, (y) any Loans under the relevant Facility that were to have been converted on the first day of such Interest Period to Eurodollar Loans shall be continued as Base Rate Loans and (z) any outstanding Eurodollar Loans under the relevant Facility shall be

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converted, on the last day of the then current Interest Period with respect thereto, to Base Rate Loans.  Until such notice has been withdrawn by the Administrative Agent, no further Eurodollar Loans under the relevant Facility shall be made or continued as such, nor shall the Borrower have the right to convert Loans under the relevant Facility to Eurodollar Loans.

2.18         Pro Rata Treatment and Payments. (a)  Each borrowing by the Borrower from the Lenders hereunder, each payment by the Borrower on account of any commitment fee or Letter of Credit fee, and any reduction of the Commitments of the Lenders, shall be made pro rata according to the respective Term Loan Percentages or Revolving Credit Percentages, as the case may be, of the relevant Lenders.  Each payment of interest in respect of the Loans and each payment in respect of fees payable hereunder shall be applied to the amounts of such obligations owing to the applicable Lenders pro rata according to the respective amounts then due and owing to the applicable Lenders.

(b)           Each payment on account of principal of the Term Loans outstanding under the Term Loan Facility shall be allocated among the Term Loan Lenders holding such Term Loans pro rata based on the principal amount of such Term Loans held by such Term Loan Lenders, and shall be applied to the installments of such Term Loans (i) in order of maturity for the next four installments and (ii) thereafter ratably over the remaining installments.  Amounts prepaid on account of the Term Loans may not be reborrowed.

(c)           Each payment (including each prepayment) by the Borrower on account of principal of the Revolving Credit Loans shall be made pro rata according to the respective outstanding principal amounts of the Revolving Credit Loans then held by the Revolving Credit Lenders.  Each payment in respect of Reimbursement Obligations in respect of any Letter of Credit shall be made to the Issuing Lender that issued such Letter of Credit.  Each payment by the Borrower on account of principal of Swing Line Loans shall be made to the Swing Line Lender (to be applied, if applicable, as provided in Section 2.7(d)).

(d)           The application of any payment of Loans under any Facility (including optional and mandatory prepayments) shall be made, first, to Base Rate Loans under such Facility and, second, to Eurodollar Loans under such Facility.  Each payment of the Loans (except in the case of Swing Line Loans and Revolving Credit Loans that are Base Rate Loans) shall be accompanied by accrued interest to the date of such payment on the amount paid.

(e)           All payments (including prepayments) to be made by the Borrower hereunder, whether on account of principal, interest, fees or otherwise, shall be made without setoff or counterclaim and shall be made prior to 12:00 Noon, New York City time, on the due date thereof to the Administrative Agent, for the account of the relevant Lenders, at the Payment Office, in Dollars and in immediately available funds.  Any payment made by the Borrower after 12:00 Noon, New York City time, on any Business Day shall be deemed to have been on the next following Business Day.  If any payment hereunder (other than payments on the Eurodollar Loans) becomes due and payable on a day other than a Business Day, such payment shall be extended to the next succeeding Business Day.  If any payment on a Eurodollar Loan becomes due and payable on a day other than a Business Day, the maturity thereof shall be extended to the next succeeding Business Day unless the result of such extension would be to extend such payment into another calendar month, in which event such payment shall be made on the

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immediately preceding Business Day.  In the case of any extension of any payment of principal pursuant to the preceding two sentences, interest thereon shall be payable at the then applicable rate during such extension.

(f)            Unless the Administrative Agent shall have been notified in writing by any Lender prior to a borrowing that such Lender will not make the amount that would constitute its share of such borrowing available to the Administrative Agent, the Administrative Agent may assume that such Lender is making such amount available to the Administrative Agent, and the Administrative Agent may, in reliance upon such assumption, make available to the Borrower a corresponding amount.  If such amount is not made available to the Administrative Agent by the required time on the Borrowing Date therefor, such Lender shall pay to the Administrative Agent, on demand, such amount with interest thereon at a rate equal to the greater of (i) the Federal Funds Effective Rate and (ii) a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation, for the period until such Lender makes such amount immediately available to the Administrative Agent.  A certificate of the Administrative Agent submitted to any Lender with respect to any amounts owing under this paragraph shall be conclusive in the absence of manifest error.  If such Lender’s share of such borrowing is not made available to the Administrative Agent by such Lender within three Business Days after such Borrowing Date, the Administrative Agent shall also be entitled to recover such amount with interest thereon at the rate per annum applicable to Base Rate Loans under the relevant Facility, on demand, from the Borrower.

(g)           Unless the Administrative Agent shall have been notified in writing by the Borrower prior to the date of any payment due to be made by the Borrower hereunder that the Borrower will not make such payment to the Administrative Agent, the Administrative Agent may assume that the Borrower is making such payment, and the Administrative Agent may, but shall not be required to, in reliance upon such assumption, make available to the Lenders their respective pro rata shares of a corresponding amount.  If such payment is not made to the Administrative Agent by the Borrower within three Business Days after such due date, the Administrative Agent shall be entitled to recover, on demand, from each Lender to which any amount which was made available pursuant to the preceding sentence, such amount with interest thereon at the rate per annum equal to the daily average Federal Funds Effective Rate.  Nothing herein shall be deemed to limit the rights of the Administrative Agent or any Lender against the Borrower.

(h)           Upon receipt by the Administrative Agent of payments on behalf of Lenders, the Administrative Agent shall promptly distribute such payments to the Lender or Lenders entitled thereto, in like funds as received by the Administrative Agent.  Notwithstanding the foregoing, if the Administrative Agent receives any payment (whether voluntarily or involuntarily, pursuant to events or proceedings of the nature referred to in Section 8(f), or otherwise) (the amount of such payment, the “Payment Amount”) for the account of any Lender (whether in such Lender’s capacity as a Term Loan Lender, Revolving Credit Lender or L/C Participant), and at the time of such receipt such Lender, in its capacity as L/C Participant, is in default in any of its obligations pursuant to Section 3.4(a) (the amount of such obligations in default, the “L/C Participation Defaulted Amount”), the Administrative Agent may withhold from the Payment Amount an amount up to the L/C Participation Defaulted Amount, and apply the amount so withheld toward payment to the relevant Issuing Lender of the L/C Participation

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Defaulted Amount or, if applicable, toward reimbursement of any other Person that has previously reimbursed such Issuing Lender for the L/C Participation Defaulted Amount.

2.19         Requirements of Law.  (a)  If the adoption of or any change in any Requirement of Law or in the interpretation or application thereof or compliance by any Lender with any request or directive (whether or not having the force of law) from any central bank or other Governmental Authority made subsequent to the date hereof:

(i)            shall subject any Lender to any tax of any kind whatsoever with respect to this Agreement, any Letter of Credit, any Application or any Eurodollar Loan made by it, or change the basis of taxation of payments to such Lender in respect thereof (except for Non-Excluded Taxes covered by Section 2.20 and changes in the rate of tax on the overall net income of such Lender);

(ii)           shall impose, modify or hold applicable any reserve, special deposit, compulsory loan or similar requirement against assets held by, deposits or other liabilities in or for the account of, advances, loans or other extensions of credit by, or any other acquisition of funds by, any office of such Lender that is not otherwise included in the determination of the Eurodollar Rate hereunder; or

(iii)          shall impose on such Lender any other condition;

and the result of any of the foregoing is to increase the cost to such Lender, by an amount which such Lender deems to be material, of making, converting into, continuing or maintaining Eurodollar Loans or issuing or participating in Letters of Credit, or to reduce any amount receivable hereunder in respect thereof, then, in any such case, the Borrower shall promptly pay such Lender, upon its demand, any additional amounts necessary to compensate such Lender for such increased cost or reduced amount receivable.  If any Lender becomes entitled to claim any additional amounts pursuant to this Section, it shall promptly notify the Borrower (with a copy to the Administrative Agent) of the event by reason of which it has become so entitled.

(b)           If any Lender shall have reasonably determined that the adoption of or any change in any Requirement of Law regarding capital adequacy or in the interpretation or application thereof or compliance by such Lender or any corporation controlling such Lender with any request or directive regarding capital adequacy (whether or not having the force of law) from any Governmental Authority made subsequent to the date hereof shall have the effect of reducing the rate of return on such Lender’s or such corporation’s capital as a consequence of its obligations hereunder or under or in respect of any Letter of Credit to a level below that which such Lender or such corporation could have achieved but for such adoption, change or compliance (taking into consideration such Lender’s or such corporation’s policies with respect to capital adequacy) by an amount deemed by such Lender to be material, then from time to time, after submission by such Lender to the Borrower (with a copy to the Administrative Agent) of a written request therefor, the Borrower shall pay to such Lender such additional amount or amounts as will compensate such Lender or such corporation for such reduction; provided that the Borrower shall not be required to compensate a Lender pursuant to this paragraph for any amounts incurred more than six months prior to the date that such Lender notifies the Borrower of such Lender’s intention to claim compensation therefor; and provided further that, if the

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circumstances giving rise to such claim have a retroactive effect, then such six-month period shall be extended to include the period of such retroactive effect.

(c)           A certificate as to any additional amounts payable pursuant to this Section (and setting forth calculations in reasonable detail demonstrating the basis therefor) submitted by any Lender to the Borrower (with a copy to the Administrative Agent) shall be conclusive in the absence of manifest error.  The obligations of the Borrower pursuant to this Section shall survive the termination of this Agreement and the payment of the Loans and all other amounts payable hereunder.

2.20         Taxes.  (a)  All payments made by the Borrower under this Agreement shall be made free and clear of, and without deduction or withholding for or on account of, any present or future income, stamp or other taxes, levies, imposts, duties, charges, fees, deductions or withholdings, now or hereafter imposed, levied, collected, withheld or assessed by any Governmental Authority, excluding net income taxes and franchise taxes (imposed in lieu of net income taxes) imposed on any Agent or any Lender as a result of a present or former connection between such Agent or such Lender and the jurisdiction of the Governmental Authority imposing such tax or any political subdivision or taxing authority thereof or therein (other than any such connection arising solely from such Agent’s or such Lender’s having executed, delivered or performed its obligations or received a payment under, or enforced, this Agreement or any other Loan Document).  If any such non-excluded taxes, levies, imposts, duties, charges, fees, deductions or withholdings (“Non-Excluded Taxes”) or any Other Taxes are required to be withheld from any amounts payable to any Agent or any Lender hereunder, the amounts so payable to such Agent or such Lender shall be increased to the extent necessary to yield to such Agent or such Lender (after payment of all Non-Excluded Taxes and Other Taxes) interest or any such other amounts payable hereunder at the rates or in the amounts specified in this Agreement; provided, however, that the Borrower shall not be required to increase any such amounts payable to any Lender with respect to any Non-Excluded Taxes (i) that are attributable to such Lender’s failure to comply with the requirements of paragraph (d) or (e) of this Section or (ii) that are United States withholding taxes imposed on amounts payable to such Lender immediately prior to the time such Lender becomes a party to this Agreement, except to the extent that such Lender’s assignor (if any) was entitled, at the time of assignment, to receive additional amounts from the Borrower with respect to such Non-Excluded Taxes pursuant to this paragraph (a).

(b)           In addition, the Borrower shall pay any Other Taxes to the relevant Governmental Authority in accordance with applicable law.

(c)           Whenever any Non-Excluded Taxes or Other Taxes are payable by the Borrower, as promptly as possible thereafter the Borrower shall send to the Administrative Agent for the account of the relevant Agent or Lender, as the case may be, a certified copy of an original official receipt received by the Borrower showing payment thereof.  If the Borrower fails to pay any Non-Excluded Taxes or Other Taxes when due to the appropriate taxing authority or fails to remit to the Administrative Agent the required receipts or other required documentary evidence, the Borrower shall indemnify the Agents and the Lenders for any incremental taxes, interest or penalties that may become payable by any Agent or any Lender as

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a result of any such failure.  The agreements in this Section shall survive the termination of this Agreement and the payment of the Loans and all other amounts payable hereunder.

(d)           Each Lender (or Transferee) that is not a “U.S. Person” as defined in Section 7701(a)(30) of the Code (a “Non-U.S. Lender”) shall deliver to the Borrower and the Administrative Agent (or, in the case of a Participant, to the Lender from which the related participation shall have been purchased) two duly completed copies of either U.S. Internal Revenue Service Form W-8BEN or Form W-8ECI, or, in the case of a Non-U.S. Lender claiming exemption from U.S. federal withholding tax under Section 871(h) or 881(c) of the Code with respect to payments of “portfolio interest” a duly completed statement substantially in the form of Exhibit F and a Form W-8BEN, or any subsequent versions thereof or successors thereto properly completed and duly executed by such Non-U.S. Lender claiming complete exemption from, or a reduced rate of, U.S. federal withholding tax on all payments by the Borrower under this Agreement and the other Loan Documents.  Such forms shall be delivered by each Non-U.S. Lender on or before the date it becomes a party to this Agreement (or, in the case of any Participant, on or before the date such Participant purchases the related participation).  In addition, each Non-U.S. Lender shall deliver such forms promptly upon the obsolescence or invalidity of any form previously delivered by such Non-U.S. Lender.  Each Non-U.S. Lender shall promptly notify the Borrower at any time it determines that it is no longer in a position to provide any previously delivered certificate to the Borrower (or any other form of certification adopted by the U.S. taxing authorities for such purpose).  Notwithstanding any other provision of this paragraph, a Non-U.S. Lender shall not be required to deliver any form pursuant to this paragraph that such Non-U.S. Lender is not legally able to deliver.

(e)           A Lender that is entitled to an exemption from or reduction of non-U.S. withholding tax under the law of the jurisdiction in which the Borrower is located, or any treaty to which such jurisdiction is a party, with respect to payments under this Agreement shall deliver to the Borrower (with a copy to the Administrative Agent), at the time or times prescribed by applicable law or reasonably requested by the Borrower, such properly completed and executed documentation prescribed by applicable law as will permit such payments to be made without withholding or at a reduced rate, provided that such Lender is legally entitled to complete, execute and deliver such documentation and in such Lender’s reasonable judgment such completion, execution or submission would not materially prejudice the legal position of such Lender.

2.21         Indemnity.  The Borrower agrees to indemnify each Lender for, and to hold each Lender harmless from, any loss or expense that such Lender may sustain or incur as a consequence of (a) default by the Borrower in making a borrowing of, conversion into or continuation of Eurodollar Loans after the Borrower has given a notice requesting the same in accordance with the provisions of this Agreement, (b) default by the Borrower in making any prepayment after the Borrower has given a notice thereof in accordance with the provisions of this Agreement or (c) the making of a prepayment or conversion of Eurodollar Loans on a day that is not the last day of an Interest Period with respect thereto.  Such indemnification may include an amount equal to the excess, if any, of (i) the amount of interest that would have accrued on the amount so prepaid, or not so borrowed, converted or continued, for the period from the date of such prepayment or of such failure to borrow, convert or continue to the last day of such Interest Period (or, in the case of a failure to borrow, convert or continue, the Interest

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Period that would have commenced on the date of such failure) in each case at the applicable rate of interest for such Loans provided for herein (excluding, however, the Applicable Margin included therein, if any) over (ii) the amount of interest (as reasonably determined by such Lender) that would have accrued to such Lender on such amount by placing such amount on deposit for a comparable period with leading banks in the interbank Eurodollar market.  A certificate as to any amounts payable pursuant to this Section (and setting forth calculations in reasonable detail demonstrating the basis therefor) submitted to the Borrower by any Lender shall be conclusive in the absence of manifest error.  This covenant shall survive the termination of this Agreement and the payment of the Loans and all other amounts payable hereunder.

2.22         Illegality.  Notwithstanding any other provision herein, if after the Closing Date the adoption of or any change in any Requirement of Law or in the interpretation or application thereof shall make it unlawful for any Lender to make or maintain Eurodollar Loans as contemplated by this Agreement, (a) the commitment of such Lender hereunder to make Eurodollar Loans, continue Eurodollar Loans as such and convert Base Rate Loans to Eurodollar Loans shall forthwith be suspended until such condition shall cease to exist and (b) such Lender’s Loans then outstanding as Eurodollar Loans, if any, shall be converted automatically to Base Rate Loans on the respective last days of the then current Interest Periods with respect to such Loans or within such earlier period as required by law.  If any such conversion of a Eurodollar Loan occurs on a day which is not the last day of the then current Interest Period with respect thereto, the Borrower shall pay to such Lender such amounts, if any, as may be required pursuant to Section 2.21.

2.23         Change of Lending Office.  Each Lender agrees that, upon the occurrence of any event giving rise to the operation of Section 2.19, 2.20(a) or 2.22  with respect to such Lender, it will, if requested by the Borrower, use reasonable efforts (subject to overall policy considerations of such Lender) to designate another lending office for any Loans affected by such event with the object of avoiding the consequences of such event; provided, that such designation is made on terms that, in the sole judgment of such Lender, cause such Lender and its lending office(s) to suffer no economic, legal or regulatory disadvantage, and provided, further, that nothing in this Section shall affect or postpone any of the obligations of the Borrower or the rights of any Lender pursuant to Section 2.19, 2.20(a) or 2.22.

2.24         Replacement of Lenders under Certain Circumstances.  The Borrower shall be permitted to replace with a replacement financial institution any Lender that (a) requests reimbursement for amounts owing pursuant to Section 2.19 or 2.20 or gives a notice of illegality pursuant to Section 2.22, (b) defaults in its obligation to make Loans hereunder or (c) refuses to consent to any amendment, waiver or other modification of any Loan Document requested by the Borrower that requires the consent of all Lenders and such amendment, waiver or other modification is consented to by the Required Lenders; provided that (i) such replacement does not conflict with any Requirement of Law, (ii) no Event of Default shall have occurred and be continuing at the time of such replacement, (iii) prior to any such replacement, such Lender shall have taken no action under Section 2.23 so as to eliminate the continued need for payment of amounts owing pursuant to Section 2.19 or 2.20 or to eliminate the illegality referred to in such notice of illegality given pursuant to Section 2.22, (iv) the replacement financial institution shall purchase, at par, all Loans and other amounts owing to such replaced Lender on or prior to the date of replacement, (v) the Borrower shall be liable to such replaced Lender under Section 2.21

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(as though Section 2.21 were applicable) if any Eurodollar Loan owing to such replaced Lender shall be purchased other than on the last day of the Interest Period relating thereto, (vi) the replacement financial institution, if not already a Lender, shall be reasonably satisfactory to the Administrative Agent, (vii) the replaced Lender shall be obligated to make such replacement in accordance with the provisions of Section 10.7 (provided that the Borrower shall be obligated to pay the registration and processing fee referred to therein), (viii) the Borrower shall pay all additional amounts (if any) required pursuant to Section 2.19 or 2.20, as the case may be, in respect of any period prior to the date on which such replacement shall be consummated, and (ix) any such replacement shall not be deemed to be a waiver of any rights that the Borrower, the Administrative Agent or any other Lender shall have against the replaced Lender.

SECTION 3.           LETTERS OF CREDIT

3.1           L/C Commitment.  (a)  Subject to the terms and conditions hereof, each Issuing Lender, in reliance on the agreements of the other Revolving Credit Lenders set forth in Section 3.4, agrees to issue sight letters of credit on a standby basis (the “Letters of Credit”) in support of the L/C Supportable Obligations for the account of the Borrower on any Business Day during the Revolving Credit Commitment Period in such form as may be approved from time to time by such Issuing Lender; provided, that no Issuing Lender shall have any obligation to issue any Letter of Credit if, after giving effect to such issuance, (i) the L/C Obligations would exceed the L/C Commitment or (ii) the aggregate amount of the Available Revolving Credit Commitments would be less than zero.  Notwithstanding the foregoing, no Issuing Lender shall have any obligation to issue any Letter of Credit on any date that is later than seven Business Days prior to the Revolving Credit Termination Date.  Each Letter of Credit shall (i) be denominated in Dollars and (ii) expire no later than the earlier of (x) the first anniversary of its date of issuance and (y) the date which is five Business Days prior to the Revolving Credit Termination Date; provided that any Letter of Credit may provide for the extension thereof for up to additional one year periods (which shall in no event extend beyond the date referred to in clause (y) above).

(b)           No Issuing Lender shall at any time be obligated to issue any Letter of Credit hereunder if (i) there shall have occurred and be continuing a Default or Event of Default or a Lender Default shall exist or (ii) such issuance would conflict with, or cause such Issuing Lender or any L/C Participant to exceed any limits imposed by, any applicable Requirement of Law.

3.2           Procedure for Issuance of Letter of Credit.  The Borrower may from time to time request that an Issuing Lender issue a Letter of Credit by delivering to such Issuing Lender (with a copy to the Administrative Agent) a Letter of Credit Request in the form of Exhibit I, attached hereto, accompanied by such other certificates, documents and other papers and other information as such Issuing Lender may request.  If the Issuing Lender shall so reasonably request, each Letter of Credit shall be accompanied by an Application.  Upon receipt of any Letter of Credit Request, an Issuing Lender will process such request in accordance with its customary procedures.  The Issuing Lender, upon determining that it has received an acceptable Letter of Credit Request and that the terms and conditions of the requested Letter of Credit are acceptable to it, shall issue the Letter of Credit (but in no event shall any Issuing Lender be required to issue any Letter of Credit earlier than three Business Days after its receipt

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of a Letter of Credit Request).  The original of any Letter of Credit shall be delivered to the beneficiary thereof or as otherwise agreed to by the Borrower and the Issuing Lender.  Promptly after the issuance or amendment of a Letter of Credit, the Issuing Lender shall promptly notify the Administrative Agent and the Borrower, in writing, of such issuance or amendment and such notice shall be accompanied by a copy of such issuance or amendment.  Upon receipt of such notice, the Administrative Agent shall notify each L/C Participant of such issuance or amendment, and if so requested by an L/C Participant, the Administrative Agent shall provide such L/C Participant with copies of such issuance or amendment.

3.3           Fees and Other Charges.  (a)  The Borrower will pay a fee to the Administrative Agent, for the ratable benefit of the Revolving Credit Lenders, on the daily aggregate drawable amount of all outstanding Letters of Credit at a per annum rate equal to the Applicable Margin then in effect with respect to Eurodollar Loans under the Revolving Credit Facility, shared ratably among the Revolving Credit Lenders in accordance with their respective Revolving Credit Percentages and payable quarterly in arrears on each L/C Fee Payment Date after the issuance date.  In addition, the Borrower shall pay to the relevant Issuing Lender for its own account a fronting fee on the aggregate drawable amount of all outstanding Letters of Credit issued by it of the greater of 1/8 of 1% per annum and $500 per annum, payable quarterly in arrears on each L/C Fee Payment Date after the issuance date.

(b)           In addition to the foregoing fees, the Borrower shall pay or reimburse each Issuing Lender for such reasonable, normal and customary costs and expenses as are incurred or charged by such Issuing Lender in issuing, effecting payment under, amending or otherwise administering any Letter of Credit.

3.4           L/C Participations.  (a)  Each Issuing Lender irrevocably agrees to grant and hereby grants to each L/C Participant, and, to induce each Issuing Lender to issue Letters of Credit hereunder, each L/C Participant irrevocably agrees to accept and purchase and hereby accepts and purchases from each Issuing Lender, on the terms and conditions hereinafter stated, for such L/C Participant’s own account and risk, an undivided interest equal to such L/C Participant’s Revolving Credit Percentage of each Issuing Lender’s obligations and rights under each Letter of Credit issued by such Issuing Lender hereunder and the amount of each draft paid by such Issuing Lender thereunder.  Each L/C Participant unconditionally and irrevocably agrees with each Issuing Lender that, if a draft is paid under any Letter of Credit issued by such Issuing Lender for which such Issuing Lender is not reimbursed in full by the Borrower in accordance with the terms of this Agreement, such L/C Participant shall pay to the Administrative Agent for the account of such Issuing Lender upon demand at the Funding Office (and thereafter the Administrative Agent shall promptly pay to such Issuing Lender) an amount equal to such L/C Participant’s Revolving Credit Percentage of the amount of such draft, or any part thereof, that is not so reimbursed.  Each L/C Participant’s obligation to pay such amount shall be absolute and unconditional and shall not be affected by any circumstance, including (i) any setoff, counterclaim, recoupment, defense or other right that such L/C Participant may have against the Issuing Lender, the Borrower or any other Person for any reason whatsoever, (ii) the occurrence or continuance of a Default or an Event of Default or the failure to satisfy any of the other conditions specified in Section 5, (iii) any adverse change in the condition (financial or otherwise) of the Borrower, (iv) any breach of this Agreement or any other Loan Document by the Borrower or any other L/C Participant or (v) any other circumstance, happening or event

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whatsoever, whether or not similar to any of the foregoing.  The failure of any L/C Participant to make any payment pursuant to this Section 3.4 shall not relieve any other L/C Participant of its obligation hereunder.

(b)           If any amount (a “Participation Amount”) required to be paid by any L/C Participant to an Issuing Lender pursuant to Section 3.4(a) in respect of any unreimbursed portion of any payment made by such Issuing Lender under any Letter of Credit is paid to such Issuing Lender within three Business Days after the date such payment is due, such Issuing Lender shall so notify the Administrative Agent, which shall promptly notify the L/C Participants, and each L/C Participant shall pay to the Administrative Agent, for the account of such Issuing Lender, on demand (and thereafter the Administrative Agent shall promptly pay to such Issuing Lender) an amount equal to the product of (i) such Participation Amount, times (ii) the daily average Federal Funds Effective Rate during the period from and including the date such payment is required to the date on which such payment is immediately available to such Issuing Lender, times (iii) a fraction the numerator of which is the number of days that elapse during such period and the denominator of which is 360.  If any Participation Amount required to be paid by any L/C Participant pursuant to Section 3.4(a) is not made available to the Administrative Agent for the account of the relevant Issuing Lender by such L/C Participant within three Business Days after the date such payment is due, the Administrative Agent on behalf of such Issuing Lender shall be entitled to recover from such L/C Participant, on demand, such Participation Amount with interest thereon calculated from such due date at the rate per annum applicable to Base Rate Loans under the Revolving Credit Facility.  A certificate of the Administrative Agent submitted on behalf of an Issuing Lender to any L/C Participant with respect to any amounts owing under this Section shall be conclusive in the absence of manifest error.

(c)           Whenever, at any time after an Issuing Lender has made payment under any Letter of Credit and has received from the Administrative Agent any  L/C Participant’s pro rata share of such payment in accordance with Section 3.4(a), such Issuing Lender receives any payment related to such Letter of Credit (whether directly from the Borrower or otherwise, including proceeds of collateral applied thereto by such Issuing Lender), or any payment of interest on account thereof, such Issuing Lender will distribute to the Administrative Agent for the account of such L/C Participant (and thereafter the Administrative Agent will promptly distribute to such L/C Participant) its pro rata share thereof; provided, however, that in the event that any such payment received by such Issuing Lender shall be required to be returned by such Issuing Lender, such L/C Participant shall return to the Administrative Agent for the account of such Issuing Lender (and thereafter the Administrative Agent shall promptly return to such Issuing Lender) the portion thereof previously distributed by such Issuing Lender.

3.5           Reimbursement Obligation of the Borrower.  The Borrower agrees to reimburse each Issuing Lender, within one Business Day (or two Business Days if the Borrower and the Administrative Agent are notified on after 11:00 a.m. New York City time on such date) after the Business Day on which such Issuing Lender notifies the Borrower and the Administrative Agent of the date and amount of a draft presented under any Letter of Credit and paid by such Issuing Lender, for the amount of (a) such draft so paid and (b) any taxes, fees, charges or other costs or expenses incurred by such Issuing Lender in connection with such payment (the amounts described in the foregoing clauses (a) and (b) in respect of any drawing,

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collectively, the “Payment Amount”).  Each such payment shall be made to such Issuing Lender at its address for notices specified herein in lawful money of the United States of America and in immediately available funds.  Interest shall be payable on each Payment Amount from the date of the applicable drawing until payment in full at the rate set forth in (i) until the second Business Day following the date of the applicable drawing, Section 2.15(b) and (ii) thereafter, Section 2.15(c).  Each notice from an Issuing Lender of a drawing under any Letter of Credit shall (unless an event of the type described in clause (i) or (ii) of Section 8(f) shall have occurred and be continuing with respect to the Borrower, in which case the procedures specified in Section 3.4 for funding by L/C Participants shall apply) constitute a request by the Borrower to the Administrative Agent for a borrowing pursuant to Section 2.5 of Base Rate Loans (or, at the option of the Administrative Agent and the Swing Line Lender in their sole discretion, a borrowing pursuant to Section 2.7 of Swing Line Loans) in the amount of such drawing.  The Borrowing Date with respect to such borrowing shall be the first date on which a borrowing of Revolving Credit Loans (or, if applicable, Swing Line Loans) could be made, pursuant to Section 2.5 (or, if applicable, Section 2.7), if the Administrative Agent had received a notice of such borrowing at the time the Administrative Agent receives notice from the relevant Issuing Lender of such drawing under such Letter of Credit.

3.6           Obligations Absolute.  The Borrower’s obligations under this Section 3 shall be absolute and unconditional under any and all circumstances and irrespective of any setoff, counterclaim or defense to payment that the Borrower may have or have had against any Issuing Lender, any beneficiary of a Letter of Credit or any other Person.  The Borrower also agrees with each Issuing Lender that such Issuing Lender shall not be responsible for, and the Borrower’s Reimbursement Obligations under Section 3.5 shall not be affected by, among other things, the validity or genuineness of documents or of any endorsements thereon, even though such documents shall in fact prove to be invalid, fraudulent or forged, or any dispute between or among the Borrower and any beneficiary of any Letter of Credit or any other party to which such Letter of Credit may be transferred or any claims whatsoever of the Borrower against any beneficiary of such Letter of Credit or any such transferee.  No Issuing Lender shall be liable to the Borrower for any error, omission, interruption or delay in transmission, dispatch or delivery of any message or advice, however transmitted, in connection with any Letter of Credit, except for errors or omissions found by a final and nonappealable decision of a court of competent jurisdiction to have resulted from the gross negligence or willful misconduct of such Issuing Lender.  The Borrower, the Lenders and any other party hereto agree that any action taken or omitted by an Issuing Lender under or in connection with any Letter of Credit issued by it or the related drafts or documents, including without limitation the payment thereof, absent a finding of gross negligence or willful misconduct of the Issuing Lender as determined by a final and nonappealable decision of a court of competent jurisdiction, shall be binding on the Borrower, the Lenders and any other party hereto and shall not result in any liability of such Issuing Lender to the Borrower, the Lenders or any other party hereto.

3.7           Letter of Credit Payments.  If any draft shall be presented for payment under any Letter of Credit, the relevant Issuing Lender shall promptly notify the Borrower and the Administrative Agent of the date and amount thereof.  The responsibility of the relevant Issuing Lender to the Borrower in connection with any draft presented for payment under any Letter of Credit, in addition to any payment obligation expressly provided for in such Letter of Credit issued by such Issuing Lender, shall be limited to determining that the documents

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(including each draft) delivered under such Letter of Credit in connection with such presentment appear on their face to be in conformity with such Letter of Credit.

3.8           Applications.  To the extent that any provision of any Application related to any Letter of Credit is inconsistent with the provisions of this Section 3, the provisions of this Section 3 shall apply.

SECTION 4.           REPRESENTATIONS AND WARRANTIES

To induce the Agents and the Lenders to enter into this Agreement and to make the Loans and issue or participate in the Letters of Credit, the Borrower hereby represents and warrants to each Agent and each Lender that:

4.1           Financial Condition.  (a)  The unaudited pro forma consolidated balance sheet of the Borrower and its Subsidiaries as of June 30, 2004 (including the notes thereto) (the “Pro Forma Balance Sheet”), copies of which have heretofore been furnished to each Lender, has been prepared in good faith based on information available to the Borrower as of the date of delivery thereof, and presents fairly on a pro forma basis the estimated consolidated financial position of the Borrower and its Subsidiaries as of June 30, 2004.

(b)           The audited consolidated balance sheets of the Borrower and its Subsidiaries as of December 31, 2001, December 31, 2002 and December 31, 2003, and the related consolidated statements of income and of cash flows for the fiscal years ended on such dates, reported on by and accompanied by a report from Deloitte & Touche LLP, copies of which have heretofore been furnished to each Lender, present fairly the consolidated financial condition of the Borrower and its Subsidiaries as at such date, and the results of their operations and cash flows for the respective fiscal years then ended.  The unaudited consolidated balance sheet of the Borrower and its Subsidiaries as of June 30, 2004, and the related unaudited consolidated statements of income and cash flows for the six-month period ended on such date, copies of which have heretofore been furnished to each Lender, present fairly the consolidated financial condition of the Borrower and its Subsidiaries as at such date, and the results of their operations and cash flows for the six-month period then ended (subject to normal year-end audit adjustments and the absence of footnotes).  All such financial statements, including the related schedules and notes thereto, have been prepared in accordance with GAAP applied consistently throughout the periods involved (except as approved by the aforementioned firm of accountants and disclosed therein).  The Borrower and its Subsidiaries do not have any material Guarantee Obligations, contingent liabilities and liabilities for taxes, or any long-term leases or unusual forward or long-term commitments, including, without limitation, any interest rate or foreign currency swap or exchange transaction or other obligation in respect of derivatives, that are not reflected in the most recent financial statements referred to in this paragraph or disclosed in SEC Reports filed prior to the date hereof or in the Disclosure Statement.  During the period from June 30, 2004 to and including the date hereof there has been no Disposition by the Borrower of any material part of its business or Property except as has been expressly disclosed in SEC Reports filed prior to the date hereof or in the Disclosure Statement.

4.2           No Change.  Since December 31, 2003 there has been no development or event that has had or could reasonably be expected to have a Material Adverse Effect except as

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has been expressly disclosed in SEC Reports filed prior to the date hereof or in the Disclosure Statement.

4.3           Corporate Existence; Compliance with Law.  Each of the Borrower and its Subsidiaries (a) is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization, (b) has the corporate or limited liability power and authority, and the legal right, to own and operate its Property, to lease the Property it operates as lessee and to conduct the business in which it is currently engaged, (c) is duly qualified as a foreign corporation or other organization and in good standing under the laws of each jurisdiction where its ownership, lease or operation of Property or the conduct of its business requires such qualification except to the extent to so qualify and be in good standing could not in the aggregate reasonably be expected to have a Material Adverse Effect (and, in any event, the Borrower is duly qualified as a foreign corporation and in good standing under the laws of the States of Montana and South Dakota), and (d) is in compliance with all Requirements of Law except to the extent that the failure to comply therewith could not, in the aggregate, reasonably be expected to have a Material Adverse Effect.

4.4           Corporate Power; Authorization; Enforceable Obligations.  The Borrower has the corporate power and authority, and the legal right, to make, deliver and perform the Loan Documents to which it is a party and to borrow hereunder.  The Borrower has taken all necessary corporate action to authorize the execution, delivery and performance of the Loan Documents to which it is a party and to authorize the borrowings on the terms and conditions of this Agreement.  Set forth on Schedule 4.4a are all consents or authorizations of, filings with, notices to or other acts by or in respect of, any Governmental Authority or any other Person required in connection with the authorization, execution, or issuance of any First Mortgage Bond, the authorization, delivery, performance or validity of any Supplemental Indenture, or the execution, delivery, performance, validity or enforceability of the Bond Delivery Agreement or any Security Document related thereto, and in each case any application therefor (collectively, the “First Mortgage Approvals”), which consents, authorizations, filings and notices have been obtained or made and are in full force and effect.  No consent or authorization of, filing with, notice to or other act by or in respect of, any Governmental Authority or any other Person is required in connection with the borrowings hereunder or the execution, delivery, performance, validity or enforceability of this Agreement or any of the other Loan Documents, except (i) consents, authorizations, filings and notices described in Schedule 4.4b, which consents, authorizations, filings and notices have been obtained or made and are in full force and effect, (ii) the First Mortgage Approvals and (iii) consents, authorizations, filings or notices which, if not obtained, could not reasonably be expected to have a Material Adverse Effect.  This Agreement has been, and each other Loan Document upon execution will be, duly executed and delivered on behalf of the Borrower.  This Agreement constitutes, and each other Loan Document upon execution will constitute, a legal, valid and binding obligation of the Borrower, enforceable against the Borrower in accordance with its terms, except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors’ rights generally and by general equitable principles (whether enforcement is sought by proceedings in equity or at law).

4.5           No Legal Bar.  The execution, delivery and performance of this Agreement and the other Loan Documents, the issuance of Letters of Credit, the borrowings

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hereunder and the use of the proceeds thereof will not violate any Requirement of Law or any Contractual Obligation of the Borrower or any of its Subsidiaries (other than violations which in the aggregate could not reasonably be expected to have a Material Adverse Effect and after taking into consideration all consents and waivers obtained by the Borrower prior to the date hereof) and will not result in, or require, the creation or imposition of any Lien on any of their respective properties or revenues pursuant to any Requirement of Law or any such Contractual Obligation (other than the Liens created by the Indentures and the Security Documents).

4.6           No Material Litigation.  Except as set forth on Schedule 4.6 or disclosed in SEC Reports filed prior to the date hereof, no litigation, investigation or proceeding of or before any arbitrator or Governmental Authority is pending or, to the knowledge of the Borrower, threatened by or against the Borrower or any of its Subsidiaries or against any of their respective properties or revenues (a) with respect to any of the Loan Documents or any of the transactions contemplated hereby or thereby, or (b) that could reasonably be expected to have a Material Adverse Effect.

4.7           No Default.  Neither the Borrower nor any of its Subsidiaries is in default under or with respect to any of its Contractual Obligations in any respect that could reasonably be expected to have a Material Adverse Effect.  No Default or Event of Default has occurred and is continuing.

4.8           Ownership of Property.  Except as set forth on Schedule 4.8, each of the Borrower and its Subsidiaries has title in fee simple to, or a valid leasehold interest in, or other appropriate property rights in, all its material real property, and good title to, or a valid leasehold interest in, all its other material Property.

4.9           Intellectual Property.  The Borrower and each of its Subsidiaries owns, or is licensed to use, all Intellectual Property necessary for the conduct of its business as currently conducted except for any such Intellectual Property that if it were not so owned or licensed could not reasonably be expected to have a Material Adverse Effect.  No material claim has been asserted and is pending by any Person challenging or questioning the use of any Intellectual Property or the validity or effectiveness of any Intellectual Property, nor does the Borrower know of any valid basis for any such claim.  The use of Intellectual Property by the Borrower and its Subsidiaries does not infringe on the rights of any Person in any material respect except for such claims and infringements that, in the aggregate, could not reasonably be expected to have a Material Adverse Effect.

4.10         Taxes.  Each of the Borrower and its Subsidiaries has filed or caused to be filed all Federal, state and other material tax returns that are required to be filed and has paid all taxes shown to be due and payable on said returns or on any assessments made against it or any of its Property and all other taxes, fees or other charges imposed on it or any of its Property by any Governmental Authority (other than any amount the validity of which is currently being contested in good faith and with respect to which reserves in conformity with GAAP have been provided on the books of the Borrower or its Subsidiaries, as the case may be); and no tax Lien has been filed, and, to the knowledge of the Borrower, no claim is being asserted, with respect to any such tax, fee or other charge.

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4.11         Federal Regulations.  The Borrower is not engaged in the business of extending credit for the purpose of “purchasing” or “carrying” any “margin stock” within the respective meanings of each of the quoted terms under Regulation U as now and from time to time hereafter in effect, and no proceeds of any extension of credit hereunder will be used to “purchase” or “carry” any “margin stock” or to extend credit to others for the purpose of “purchasing” or “carrying” any “margin stock”, except in compliance with applicable law and regulations.

4.12         Labor Matters.  There are no strikes or other labor disputes against the Borrower or any of its Subsidiaries pending or, to the knowledge of the Borrower, threatened that (individually or in the aggregate) could reasonably be expected to have a Material Adverse Effect.  Hours worked by and payment made to employees of the Borrower and its Subsidiaries have not been in violation of the Fair Labor Standards Act or any other applicable Requirement of Law dealing with such matters that (individually or in the aggregate) could reasonably be expected to have a Material Adverse Effect.  All payments due from the Borrower or any of its Subsidiaries on account of employee health and welfare insurance that (individually or in the aggregate) could reasonably be expected to have a Material Adverse Effect if not paid have been paid or accrued as a liability on the books of the Borrower or the relevant Subsidiary.

4.13         ERISA.  Except as disclosed on Schedule 4.13; (a) neither a Reportable Event nor an “accumulated funding deficiency” (within the meaning of Section 412 of the Code or Section 302 of ERISA) has occurred during the five-year period prior to the date on which this representation is made or deemed made with respect to any Single Employer Plan, and each Single Employer Plan has complied in all material respects with the applicable provisions of ERISA and the Code; (b) no termination of a Single Employer Plan has occurred, and no Lien in favor of the PBGC or a Single Employer Plan has arisen, during such five-year period; (c) the present value of all accrued benefits under each Single Employer Plan (based on those assumptions used to fund such Single Employer Plans) did not, as of the last annual valuation date prior to the date on which this representation is made or deemed made, exceed the value of the assets of such Single Employer Plan allocable to such accrued benefits by a material amount; (d) neither the Borrower nor any Commonly Controlled Entity has had a complete or partial withdrawal from any Multiemployer Plan that has resulted or could reasonably be expected to result in a material liability under ERISA; and (e) no such Multiemployer Plan is in Reorganization or Insolvent.

4.14         Investment Company Act; Other Regulations; PUHCA.  The Borrower is not an “investment company”, or a company “controlled” by an “investment company”, within the meaning of the Investment Company Act of 1940, as amended.  Except as set forth on Schedule 4.14, the Borrower is not subject to regulation under any Requirement of Law (other than Regulation X of the Board) that limits its ability to incur Indebtedness.  The Borrower is not a “holding company” as defined in the Public Utility Holding Company Act of 1935, as amended (“PUHCA”).  The Borrower is not required to make any filing or obtain any approval under PUHCA in connection with the execution or deliver of, the validity or enforceability of, or the performance under, the Loan Documents (or the incurrence of indebtedness (including first mortgage bonds) or granting of security interests thereunder) other than any filing or approval which has been made or obtained and is in full force and effect.  On the Closing Date, by virtue of one or more Persons becoming a holder of 10% or more of the Borrower’s voting securities (as

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defined in PUHCA) upon consummation of the Borrower’s Plan of Reorganization, the Borrower will fall within the definition of a “subsidiary company” of a “holding company” (as such terms are defined in PUHCA).  By virtue of the filing of an application for exemption under Section 3(a)(4) of PUHCA by each such Person, the Borrower is a subsidiary of an exempt holding company, and on that basis the Borrower is exempt from the provisions of PUHCA, except for the provisions of Section 9(a)(2) thereof relating to the acquisition of securities of a public utility company.

4.15         Subsidiaries.  (a)  The Subsidiaries listed on Schedule 4.15 constitute all the Subsidiaries of the Borrower at the date hereof.  Schedule 4.15 sets forth as of the Closing Date the name and jurisdiction of incorporation of each Subsidiary and, as to each Subsidiary, the percentage of each class of Capital Stock owned by the Borrower.

(b)           There are no outstanding subscriptions, options, warrants, calls, rights or other agreements or commitments (other than stock options granted to employees or directors and directors’ qualifying shares) of any nature relating to any Capital Stock of the Borrower or any Subsidiary, except as disclosed on Schedule 4.15.

4.16         Use of Proceeds.  The proceeds of the Term Loans will be used solely to repay in full and terminate the Existing Credit Facility and to pay related fees and expenses.  The proceeds of Revolving Credit Loans may be used on the Closing Date to repay the Existing Credit Facility and thereafter, proceeds of the Revolving Credit Loans and Swing Line Loans will be used for general corporate purposes of the Borrower and its Subsidiaries in the ordinary course of business; provided, however, that no proceeds of the Revolving Credit Loans will be used for loans to or investments in the Excluded Subsidiaries.  Letters of Credit will support payment obligations of the Borrower (or, subject to the provisions of Section 7.7(k), its Wholly Owned Subsidiaries or Excluded Subsidiaries) in each case incurred for general corporate purposes of the Borrower and its Wholly Owned Subsidiaries in the ordinary course of business; provided that the aggregate outstanding face amount of Letters of Credit issued for the account (or otherwise to support obligations) of Excluded Subsidiaries shall not exceed $60,000,000 at any time.

4.17         Environmental Matters.  Except as set forth on Schedule 4.17, other than exceptions to any of the following that could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect:

(a)           The Borrower and its Subsidiaries:  (i) are, and within the period of all applicable statutes of limitation have been, in compliance with all applicable Environmental Laws; (ii) hold all Environmental Permits (each of which is in full force and effect) required for any of their current or intended operations or for any property owned, leased, or otherwise operated by any of them; (iii) are, and within the period of all applicable statutes of limitation have been, in compliance with all of their Environmental Permits; and (iv) reasonably believe that:  each of their Environmental Permits will be timely renewed and complied with, without material expense; any additional Environmental Permits that may be required of any of them will be timely obtained and complied with, without material expense; and compliance with any Environmental Law

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that is or is expected to become applicable to any of them will be timely attained and maintained, without material expense.

(b)           Materials of Environmental Concern are not present at, on, under, in, or about any real property now or formerly owned, leased or operated by the Borrower or any of its Subsidiaries, or at any other location (including, without limitation, any location to which Materials of Environmental Concern have been sent for re-use or recycling or for treatment, storage, or disposal) which could reasonably be expected to (i) give rise to liability of the Borrower or any of its Subsidiaries under any applicable Environmental Law, or (ii) interfere with the Borrower’s or any of its Subsidiaries’ continued operations, or (iii) impair the fair saleable value of any real property owned or leased by the Borrower or any of its Subsidiaries (excluding any use restrictions that may be applicable to any such real property as of the date hereof).

(c)           There is no judicial, administrative, or arbitral proceeding (including any notice of violation or alleged violation) under or relating to any Environmental Law to which the Borrower or any of its Subsidiaries is, or to the knowledge of the Borrower or any of its Subsidiaries will be, named as a party that is pending or, to the knowledge of the Borrower or any of its Subsidiaries, threatened.

(d)           Neither the Borrower nor any of its Subsidiaries has been notified that it is a potentially responsible party under or relating to the federal Comprehensive Environmental Response, Compensation, and Liability Act or any similar Environmental Law, or with respect to any Materials of Environmental Concern.

(e)           Neither the Borrower nor any of its Subsidiaries has entered into or agreed to any consent decree, order, or settlement or other agreement, or is subject to any judgment, decree, or order or other agreement, in any judicial, administrative, arbitral, or other forum for dispute resolution, the obligations of the Borrower and its Subsidiaries under which remain unsatisfied and unwaived (other than ongoing compliance obligations under any Environmental Law).

(f)            Neither the Borrower nor any of its Subsidiaries has assumed or retained, by contract or operation of law, any liabilities of any kind, fixed or contingent, known or unknown, under any Environmental Law or with respect to any Material of Environmental Concern.

4.18         Accuracy of Information, etc.  All information, reports and other papers and data (other than projections) with respect to the Borrower or any Subsidiary furnished to the Lenders by the Borrower, or on behalf of the Borrower, and all SEC Reports were, in each case at the date thereof, complete and correct in all material respects, or have been subsequently supplemented by other information, reports or other papers or data, to the extent necessary to give the Lenders a true and accurate knowledge of the subject matter in all material respects.  All projections with respect to the Borrower or any Subsidiary, furnished by the Borrower, were prepared and presented in good faith by the Borrower based upon facts and assumptions that the Borrower believed to be reasonable in light of current and foreseeable conditions, it being understood that projections are subject to significant uncertainties and contingencies, many of

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which are beyond the control of the Borrower and that no assurance can be given that the financial results set forth in such projections will actually be realized and the Borrower shall be under no obligation to update such projections.  No document furnished or statement made in writing to the Lenders by or on behalf of the Borrower in connection with the negotiation, preparation or execution of this Agreement and no SEC Report contained as of the date thereof any untrue statement of a material fact, or omitted to state any such material fact necessary in order to make the statements contained therein not misleading.

4.19         Security Documents.

(a)           Montana First Mortgage Indenture.

(i)            The First Mortgage Bonds to be issued under the Montana First Mortgage Indenture, as heretofore supplemented and to be supplemented by the Twenty-Fourth Supplemental Indenture (the “Montana Supplemental Indenture”), when delivered to the Collateral Agent, will be duly executed, authenticated, issued and delivered, and will constitute valid and binding obligations of the Borrower, entitled to the benefits of the security provided by the Lien of such Indenture (except to the extent that enforceability of such Lien may be limited by the effect of certain laws of the jurisdictions in which the physical properties covered thereby are located upon the remedies provided in such Indenture, which limitations, however, do not make the remedies afforded inadequate for the realization of the security and benefits provided by such Indenture, and except as enforceability of such Lien may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors’ rights and except that the availability of the remedy of specific performance or injunctive relief is subject to the discretion of the court before which any proceeding therefor is brought).

(ii)           The Montana First Mortgage Indenture as heretofore supplemented now constitutes, and such Indenture, when the Montana Supplemental Indenture shall have been duly filed for recording and recorded, will constitute, a valid and enforceable first mortgage Lien for the equal and proportionate security of the first mortgage bonds issued or to be issued thereunder, upon substantially all of the physical properties and franchises of the Borrower which are specifically described therein as subject to the Lien thereof and which are used or useful in the conduct of the Montana Utility Business, free from all prior Liens, charges or encumbrances (other than “Excepted Encumbrances” (as defined in the Montana First Mortgage Indenture) and other than, in the case of property acquired after the date of the original execution and delivery of the Montana First Mortgage Indenture, vendors’ liens, purchase money mortgages and any other liens thereon at the time of acquisition thereof) (except to the extent that enforceability of such Lien may be limited by the effect of certain laws of the jurisdictions in which the physical properties covered thereby are located upon the remedies provided in such Indenture as heretofore supplemented and to be supplemented by the Montana Supplemental Indenture, which limitations, however, do not make the remedies afforded inadequate for the realization of the benefits provided by such

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Indenture, and except as enforceability of such Lien may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors’ rights and except that the availability of the remedy of specific performance or injunctive relief is subject to the discretion of the court before which any proceeding therefor is brought); and the after-acquired property clause in such Indenture subjects to the Lien thereof all after-acquired utility property of the Montana Utility Business as provided therein (except such thereof as is expressly excepted from the Lien of such Indenture).

(iii)          The Montana First Mortgage Indenture as heretofore supplemented (excluding the Montana Supplemental Indenture but including any necessary related financing statements), has been filed and recorded wherever and to the extent necessary to perfect the Lien thereof upon the properties now owned by the Borrower and intended to be subject thereto; all fees or taxes in connection therewith have been paid and no other filing or recordation is presently necessary in order to perfect the Lien of such Indenture on such properties.

(iv)          No filing or recording of the Montana Supplemental Indenture is necessary to perfect the Lien of the Montana First Mortgage Indenture upon the properties now owned by the Borrower and intended to be subject thereto or to extend such Lien for the benefit of the First Mortgage Bonds to be issued thereunder; no re-recording or refiling of such Indenture or any other instruments or documents (except for periodic filings which extend the effectiveness of financing statements) is required to preserve and protect the Lien of such Indenture; and under the present laws of the States in which the property intended to be subject to the Lien of such Indenture is located, no further supplemental indentures or other instruments or documents are required to be executed, filed and/or recorded to extend the Lien of such Indenture to after-acquired property; however, the Borrower is required by the terms of the Montana First Mortgage Indenture to promptly record and file the Montana Supplemental Indenture.

(v)           The Borrower has good and marketable title to all properties owned by it which are subject to the Montana First Mortgage Indenture, subject only (a) to the Lien of such Indenture, (b) to Excepted Encumbrances (as defined in such Indenture) and (c) to minor exceptions and defects which do not, in the aggregate, materially interfere with the use by the Borrower of such properties for the purposes for which they are held, materially detract from the value of said properties or in any material way impair the security afforded by such Indenture.

(b)           South Dakota First Mortgage Indenture.

(i)            The First Mortgage Bonds to be issued under the South Dakota First Mortgage Indenture, as heretofore supplemented and to be supplemented by a Supplemental Indenture creating the South Dakota First Mortgage Bonds (the “South Dakota Supplemental Indenture”), when delivered to the Collateral Agent, will be duly executed, authenticated, issued and delivered, and will constitute valid and binding obligations of the Borrower, entitled to the benefits of the

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security provided by the Lien of such Indenture (except to the extent that enforceability of such Lien may be limited by the effect of certain laws of the jurisdictions in which the physical properties covered thereby are located upon the remedies provided in such Indenture, which limitations, however, do not make the remedies afforded inadequate for the realization of the security and benefits provided by such Indenture, and except as enforceability of such Lien may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors’ rights and except that the availability of the remedy of specific performance or injunctive relief is subject to the discretion of the court before which any proceeding therefor is brought).

(ii)           The South Dakota First Mortgage Indenture as heretofore supplemented now constitutes, and such Indenture, when the South Dakota Supplemental Indenture shall have been duly filed for recording and recorded, will constitute, a valid and enforceable first mortgage Lien for the equal and proportionate security of the first mortgage bonds issued or to be issued thereunder, upon substantially all of the physical properties and franchises of the Borrower which are specifically described therein as subject to the Lien thereof and which are used or useful in the conduct of the South Dakota Utility Business, free from all prior Liens, charges or encumbrances (other than “Permitted Liens” (as defined in the South Dakota First Mortgage Indenture) and other than, in the case of property acquired after the date of the original execution and delivery of the South Dakota First Mortgage Indenture, vendors’ liens, purchase money mortgages and any other liens thereon at the time of acquisition thereof) (except to the extent that enforceability of such Lien may be limited by the effect of certain laws of the jurisdictions in which the physical properties covered thereby are located upon the remedies provided in such Indenture as heretofore supplemented and to be supplemented by the South Dakota Supplemental Indenture, which limitations, however, do not make the remedies afforded inadequate for the realization of the security and benefits provided by such Indenture, and except as enforceability of such Lien may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors’ rights and except that the availability of the remedy of specific performance or injunctive relief is subject to the discretion of the court before which any proceeding therefor is brought) and the after-acquired property clause in such Indenture subjects to the Lien thereof all after-acquired property of the South Dakota Utility Business as provided therein (except such thereof as is expressly excepted from the Lien of such Indenture).

(iii)          The South Dakota First Mortgage Indenture (excluding the South Dakota Supplemental Indenture but including any necessary related financing statements), has been filed and recorded wherever and to the extent necessary to perfect the Lien thereof upon the properties now owned by the Borrower and intended to be subject thereto; all fees or taxes in connection therewith have been paid and no filing of the South Dakota Supplemental Indenture or other filing or recordation is necessary in order to perfect the Lien of such Indenture on such properties.  No filing or recording of the South Dakota Supplemental Indenture is

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necessary to extend the Lien of the South Dakota First Mortgage Indenture for the benefit of the First Mortgage Bonds to be issued under the South Dakota Supplemental Indenture.

(iv)          Subject to the South Dakota First Mortgage Indenture being filed in the counties where such property is located, the provisions of the South Dakota First Mortgage Indenture for the extension of the Lien thereof to property located in the States of South Dakota and Nebraska acquired by the Company after the date of the South Dakota Supplemental Indenture are effective, without the execution by the Borrower of any further supplemental indenture, to extend the lien of the South Dakota First Mortgage to the interests of the Borrower in such property.

(v)           The Borrower has good and marketable title to all properties owned by it which are subject to the South Dakota First Mortgage Indenture, subject only (a) to the Lien of such Indenture, (b) to Permitted Liens (as defined in such Indenture) and (c) to minor exceptions and defects which do not, in the aggregate, materially interfere with the use by the Borrower of such properties for the purposes for which they are held, materially detract from the value of said properties or in any material way impair the security afforded by such Indenture.

4.20         Solvency.  The Borrower is, and after giving effect to the transactions contemplated hereby and the incurrence of all Indebtedness and obligations being incurred in connection herewith will be, Solvent.

SECTION 5.           CONDITIONS PRECEDENT

5.1           Conditions to Initial Extension of Credit.  The agreement of each Lender to make the initial extension of credit requested to be made by it hereunder is subject to the satisfaction, prior to or concurrently with the making of such extension of credit on the Closing Date, of the following conditions precedent:

(a)           Loan Documents.  The Administrative Agent shall have received (i) this Agreement, executed and delivered by a duly authorized officer of the Borrower, (ii) the Bond Delivery Agreement, executed and delivered by a duly authorized officer of the Borrower, (iii) the Supplemental Indentures, executed and delivered by a duly authorized officer of each party thereto and a certified copy of each of the Indentures (including any amendments and supplements thereto) and (iv) a Lender Addendum executed and delivered by each Lender and accepted by the Borrower.

(b)           No Default or Event of Default.  There shall not exist (pro forma for the incurrence of the Facilities) any Default or Event of Default.

(c)           Plan of Reorganization.  (i) The effective date of the Plan of Reorganization, the incurrence of the Facilities and the other transactions contemplated hereby shall have been consummated on or prior to November 1, 2004 pursuant to the Plan of Reorganization (and other related documentation), in a manner reasonably acceptable to the Arrangers.

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(ii) The Plan of Reorganization shall not have been amended, supplemented or modified in any manner since August 18, 2004 other than in a manner reasonably acceptable to the Arrangers.

(d)           Bankruptcy Court Orders.  The Bankruptcy Court shall have entered an order, in form and substance reasonably acceptable to the Arrangers, confirming the Plan of Reorganization, such order having become a Final Order (the “Confirmation Order”), and such order shall be in full force and effect, and the Administrative Agent shall have received a certificate of a Responsible Officer to the foregoing effect.

(e)           Debtor-in-Possession Financing.  Amounts outstanding under any debtor-in-possession financings of the Borrower shall have been paid in full (and any commitments thereunder terminated), and all Liens created in favor of lenders (or their agents) under any such debtor-in-possession financings shall have been terminated.

(f)            Approvals.  All governmental and third party approvals (including, without limitation, of the Bankruptcy Court) necessary or, in the reasonable discretion of the Arrangers, advisable in connection with the transactions contemplated hereby and the continuing operations of the Borrower and its Subsidiaries shall have been obtained and be in full force and effect, and all applicable waiting periods shall have expired without any action being taken or threatened by any competent authority that would restrain, prevent or otherwise impose materially adverse conditions on the financings contemplated hereby.

(g)           Fees.  The Lenders and the Administrative Agent shall have received all fees required to be paid, and all expenses required to be reimbursed for which invoices have been presented (including reasonable fees, disbursements and other charges of counsel to the Agents), on or before the Closing Date.  All such amounts will be paid with proceeds of Loans made on the Closing Date and will be reflected in the funding instructions given by the Borrower to the Administrative Agent on or before the Closing Date.

(h)           Issuance of First Mortgage Bonds.  (i) All First Mortgage Approvals shall have been obtained and shall be in full force and effect; (ii) the Supplemental Indentures shall have been validly authorized, executed and delivered and the First Mortgage Bonds comprising (x) with respect to the Revolving Credit Facility, $90 million principal amount of the First Mortgage Bonds, Collateral (2004) Series A, due 2009 issued under the Montana First Mortgage Indenture and $35 million principal amount of the New Mortgage Bonds, Collateral (2004) Series A, due 2009 issued under the South Dakota First Mortgage Indenture (such First Mortgage Bonds, collectively, the “Revolving Credit First Mortgage Bonds”), and (y) with respect to the Term Loan Facility, $72 million principal amount of the First Mortgage Bonds, Collateral (2004) Series B, due 2011 issued under the South Dakota Mortgage Indenture and $28 million principal amount of the New Mortgage Bonds, Collateral (2004) Series B, due 2011 issued under the South Dakota First Mortgage Indenture (such First Mortgage Bonds, collectively, the “Term Loan First Mortgage Bonds”), shall have been validly authorized, executed and authenticated and validly issued and delivered to the Collateral Agent; and (iii) the

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Administrative Agent shall have received (I) copies of all opinions, certificates, orders, consents and other documents that are delivered to the trustees under the Indentures as conditions precedent to (or otherwise in connection with) the issuance of the First Mortgage Bonds under the Indentures (together with, in the case of each such opinion that is not addressed to the Collateral Agent, a letter from the counsel rendering such opinion to the effect that the Collateral Agent is entitled to rely on such opinion as if such opinion were addressed to the Collateral Agent), (II) copies of all First Mortgage Approvals and (III) such other opinions, certificates and documents reasonably related to the First Mortgage Bonds, the Indentures (including the Supplemental Indentures) and the Liens and security interests of the Indentures as the Arrangers shall have reasonably requested, and all of the foregoing documents (including without limitation the First Mortgage Approvals, the Supplemental Indentures and the First Mortgage Bonds) shall be in form and substance reasonably satisfactory to the Arrangers.

(i)            Financial Statements.  The Lenders shall have received satisfactory audited and unaudited (which have been reviewed by the independent accountants for the Borrower as provided in Statement on Auditing Standards No. 71) financial statements of the Borrower and all other completed or probable acquisitions (including pro forma financial statements) meeting the requirements of Regulation S-X for a Form S-1 registration statement under the Securities Act of 1933, as amended, and all such financial statements shall be satisfactory in form to the Arrangers in their sole discretion.  Such financial statements shall show pro forma Consolidated EBITDA of the Borrower (calculated in accordance with Regulation S-X and including only those adjustments the Administrative Agent agrees are appropriate) for the twelve-month period ended June 30, 2004 of not less than $190 million and pro forma total leverage of not more than 4.75x.

(j)            Closing Certificate.  The Administrative Agent shall have received certificates of the Borrower, dated the Closing Date, substantially in the forms of Exhibit C-1 and C-2, with appropriate insertions and attachments.

(k)           Projections.  The Lenders shall have received projections for fiscal years 2004 through 2008 (consistent in all substantial respects with the Plan of Reorganization, as currently in effect) and a satisfactory written analysis of the business and prospects of the Borrower and its Subsidiaries for the period from the Closing Date through the final maturity of the Facilities (as extended or exchanged), substantially as previously provided in the Confidential Information Memorandum, all in form and substance reasonably satisfactory to the Arrangers.

(l)            Environmental Report.  The Administrative Agent shall have received a copy of the Borrower’s recent environmental audit performed by ELM Consulting, LLC with respect to the real property owned or leased by the Borrower and its Subsidiaries, in form and substance reasonably satisfactory to the Arrangers.

(m)          Legal Opinions.  The Administrative Agent shall have received the following executed legal opinions addressed to the Administrative Agent and the Lenders and in form and substance reasonably satisfactory to the Arrangers:

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(i)            the legal opinion of Paul, Hastings, Janofsky & Walker, L.L.P., counsel to the Borrower and its Subsidiaries;

(ii)           the legal opinion of Alan D. Dietrich, Vice President - Legal Administration & Corporate Secretary of the Borrower and its Subsidiaries; and

(iii)          the legal opinion of local counsel in each of Iowa, Nebraska, Montana, North Dakota, South Dakota and Wyoming as may be reasonably required by the Administrative Agent.

(n)           PATRIOT Act.  The Lenders shall have received, sufficiently in advance of the Closing Date, all documentation and other information required by bank regulatory authorities under applicable “know your customer” and anti-money laundering rules and regulations, including without limitation the United States PATRIOT Act.

5.2           Conditions to Term Loans.  The agreement of each Lender to make the extension of Term Loans requested to be made by it hereunder is subject to the satisfaction, prior to or concurrently with the making of such extension of credit on the Closing Date, of the conditions precedent set forth in Section 5.1 hereof and the following additional conditions precedent.

(a)           The Administrative Agent shall have received satisfactory evidence that all conditions to the issuance of the Senior Notes have been (or concurrently with the making of the extensions of credit hereunder on the Closing Date will be) satisfied and that the Borrower shall receive on the Closing Date at least $225 million in gross proceeds from the issuance of its Senior Notes on terms reasonably satisfactory to the Arrangers (including without limitation the terms of the first mortgage bonds issued under the Indentures in connection therewith) and the Senior Notes Indenture and all related documentation shall be in form and substance reasonably satisfactory to the Arrangers.

(b)           The Administrative Agent shall have received satisfactory evidence that on the Closing Date all amounts outstanding under the Existing Credit Facility shall be paid in full (and any commitments thereunder terminated), the first mortgage bonds issued in connection with the Existing Credit Facility shall be retired, and all Liens created in favor of lenders (or their agents) under the Existing Credit Facility shall be terminated.

5.3           Conditions to Each Extension of Credit

The agreement of each Lender to make any extension of credit requested to be made by it hereunder on any date (including, without limitation, its initial extension of credit) is subject to the satisfaction of the following conditions precedent:

(a)           Representations and Warranties.  Each of the representations and warranties made by the Borrower in or pursuant to the Loan Documents (except to the extent applicable to an earlier date) shall be true and correct in all material respects on and as of such date as if made on and as of such date.

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(b)           No Default.  No Default or Event of Default shall have occurred and be continuing on such date or after giving effect to the extensions of credit requested to be made on such date.

Each borrowing by and issuance of a Letter of Credit on behalf of the Borrower hereunder shall constitute a representation and warranty by the Borrower as of the date of such extension of credit that the conditions contained in this Section 5.3 have been satisfied.

SECTION 6.           AFFIRMATIVE COVENANTS

The Borrower hereby agrees that, so long as the Commitments remain in effect, any Letter of Credit remains outstanding or any Loan or other Obligation is owing to any Lender or any Agent hereunder, the Borrower shall and shall cause each of its Subsidiaries to:

6.1           Financial Statements.  Furnish to the Administrative Agent (which shall make available such items to the Lenders):

(a)           as soon as available, but in any event within 90 days after the end of each fiscal year of the Borrower, a copy of the audited consolidated balance sheet of the Borrower and its Subsidiaries as at the end of such year and the related audited consolidated statements of income and cash flows for such year, setting forth in each case in comparative form the actual figures as of the end of and for the previous year, reported on without a “going concern” or like qualification or exception, or qualification arising out of the scope of the audit, by Deloitte & Touche or other independent certified public accountants of nationally recognized standing, provided that delivering to the Administrative Agent copies of the Borrower’s Annual Report on Form 10-K for such period shall satisfy the foregoing requirements; and

(b)           as soon as available, but in any event not later than 45 days after the end of each of the first three quarterly periods of each fiscal year of the Borrower, the unaudited consolidated balance sheet of the Borrower and its Subsidiaries as at the end of such quarter and the related unaudited consolidated statements of income and cash flows for such quarter and the portion of the fiscal year through the end of such quarter, setting forth in each case in comparative form the actual figures as of the end of and for the corresponding period in the previous year, certified by a Responsible Officer as being fairly stated in all material respects (subject to normal year-end audit adjustments and the absence of footnotes), provided that delivering to the Administrative Agent copies of the Borrower’s Quarterly Report on Form 10-Q for such period shall satisfy the foregoing requirements;

all such financial statements to be complete and correct in all material respects and to be prepared in reasonable detail and in accordance with GAAP applied consistently throughout the periods reflected therein and with prior periods (except as approved by such accountants or officer, as the case may be, and disclosed therein).  Information required to be delivered pursuant to the foregoing Section 6.1(a) and (b) or pursuant to Section 6.2(c) below shall be deemed to have been delivered on the date on which Borrower provides notice (including notice by e-mail) to the Administrative Agent (which notice the Administrative Agent will convey promptly to the

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Lenders) that such information has been posted on the SEC website on the Internet at sec.gov/edgar/searches.htm or at another website identified in such notice and accessible by the Lenders without charge; provided that (i) such notice may be included in a certificate delivered pursuant to Section 6.2(a) or (b) and (ii) the Borrower shall deliver paper copies of such information to the Administrative Agent, and the Administrative Agent shall deliver paper copies of such information to any Lender that requests such delivery.

6.2           Certificates; Other Information.  Furnish to the Administrative Agent (which shall make available such items to the Lenders):

(a)           concurrently with the delivery of the financial statements referred to in Section 6.1(a), a certificate of the independent certified public accountants reporting on such financial statements stating that in making the examination necessary therefor no knowledge was obtained of any Default or Event of Default, except as specified in such certificate (it being understood that such certificate shall be limited to the items that independent certified public accountants are permitted to cover in such certificates pursuant to the professional standards and customs of their profession);

(b)           concurrently with the delivery of any financial statements pursuant to Section 6.1, (i) a certificate of a Responsible Officer stating that, to the best of such Responsible Officer’s knowledge, the Borrower during such period has observed or performed all of its covenants and other agreements, and satisfied every condition, contained in this Agreement and the other Loan Documents to which it is a party to be observed, performed or satisfied by it, and that such Responsible Officer has obtained no knowledge of any Default or Event of Default except as specified in such certificate and (ii) a Compliance Certificate containing all information and calculations necessary for determining compliance by the Borrower and its Subsidiaries with the provisions of this Agreement referred to therein as of the last day of the fiscal quarter or fiscal year of the Borrower, as the case may be;

(c)           within five Business Days after the same are sent, copies of all reports that the Borrower sends to the holders of any class of its public equity securities and, within five Business Days after the same are filed, copies of all registration statements, SEC Reports and other material reports that the Borrower may file with the SEC;

(d)           concurrently with the delivery thereof or promptly after receipt thereof, a copy of all notices of default by the Borrower under either Indenture or the Senior Note Indenture;

(e)           concurrently with the submission by the Borrower to the trustee under either Indenture of an application or request for any of the following, a copy of such application or request: (i) the authentication and delivery of bonds, (ii) the application of insurance proceeds, (iii) the release of property or withdrawal of cash or (iv) the execution and delivery of a supplemental indenture pertaining to such Indenture; and

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(f)            promptly, such additional financial and other information (including any bondable capacity reports or information then available) as any Lender may, through the Administrative Agent, from time to time reasonably request.

6.3           Payment of Obligations.  Pay, discharge or otherwise satisfy at or before maturity or before they become delinquent, as the case may be, all its obligations of whatever nature, material to the Borrower and its Subsidiaries taken as a whole, except where the amount or validity thereof is currently being contested in good faith and reserves in conformity with GAAP with respect thereto have been provided on the books of the Borrower or its Subsidiaries, as the case may be.

6.4           Conduct of Business and Maintenance of Existence; Compliance.  (a) (i) Preserve, renew and keep in full force and effect its organizational existence and (ii) take all reasonable action to maintain all rights, privileges and franchises necessary or desirable in the normal conduct of its business, except, in each case, as otherwise permitted by Section 7.4 and except, in the case of clause (ii) above, to the extent that failure to do so could not, in the aggregate, reasonably be expected to have a Material Adverse Effect; and (b) comply with all Contractual Obligations and Requirements of Law, except to the extent that failure to comply therewith could not, in the aggregate, reasonably be expected to have a Material Adverse Effect.

6.5           Maintenance of Property; Insurance.  (a) Keep all material Property and systems useful and necessary in its business in good working order and condition, ordinary wear and tear and casualties excepted, (b) maintain with financially sound and reputable insurance companies insurance on all its material Property in at least such amounts and against at least such risks as are usually insured against in the same general area by companies engaged in the same or a similar business, (c) maintain ownership, directly (and not through any Subsidiary), of all or substantially all of the businesses and assets of the Utility Business, (d) subject to the Borrower’s rights under Section 7.5, maintain the Lien of the Montana First Mortgage Indenture on all or substantially all of the assets of the Montana Utility Business and (e) subject to the Borrower’s rights under Section 7.5, maintain the Lien of the South Dakota First Mortgage Indenture on all or substantially all of the assets of the South Dakota Utility Business.

6.6           Inspection of Property; Books and Records; Discussions.  (a) Keep proper books of records and account in which full, true and correct entries in conformity with GAAP and all Requirements of Law shall be made of all dealings and transactions in relation to its business and activities and (b) upon reasonable prior notice, permit representatives of any Lender to visit and inspect any of its properties and examine and make abstracts from any of its books and records at any reasonable time and as often as may reasonably be desired and to discuss the business, operations, properties and financial and other condition of the Borrower and its Subsidiaries with officers and employees of the Borrower and its Subsidiaries and with its independent certified public accountants.

6.7           Notices.  Within five days after the Borrower has knowledge of such event or circumstance under clause (a) below, within ten days after the Borrower has knowledge of such event or circumstance under clause (b), (c) or (f) below, and within thirty days after the Borrower has knowledge of such event or circumstance under clause (d) or (e) below, give notice to the Administrative Agent of:

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(a)           the occurrence of any Default or Event of Default;

(b)           any (i) default or event of default under any Contractual Obligation of the Borrower or any of its Subsidiaries or (ii) litigation, investigation or proceeding which may exist at any time between the Borrower or any of its Subsidiaries and any Governmental Authority, that in either case, if not cured or if adversely determined, as the case may be, could reasonably be expected to have a Material Adverse Effect;

(c)           any litigation or proceeding affecting the Borrower or any of its Subsidiaries (i) in which the amount involved is $10,000,000 or more and not covered by insurance, (ii) in which injunctive or similar relief is sought which if such relief is obtained could reasonably be expected to have a Material Adverse Effect, or (iii) which directly relates to any Loan Document;

(d)           (i) the occurrence of any Reportable Event with respect to any Single Employer Plan, a failure to make any required contribution to a Single Employer Plan, the creation of any Lien in favor of the PBGC or a Single Employer Plan or any withdrawal from, or the termination, Reorganization or Insolvency of, any Multiemployer Plan or (ii) the institution of proceedings or the taking of any other action by the PBGC or the Borrower or any Commonly Controlled Entity or any Multiemployer Plan with respect to the withdrawal from, or the termination, Reorganization or Insolvency of, any Single Employer Plan or Multiemployer Plan;

(e)           any notice that any Governmental Authority may deny any application for a material Environmental Permit sought by, or revoke or refuse to renew any material Environmental Permit held by, the Borrower; and

(f)            any development or event that has had or could reasonably be expected to have a Material Adverse Effect.

Each notice pursuant to this Section shall be accompanied by a statement of a Responsible Officer setting forth details of the occurrence referred to therein and stating what action the Borrower or the relevant Subsidiary proposes to take with respect thereto.  For purposes of this Section 6.7, the Borrower shall be deemed to have knowledge of an event or circumstance if (i) the chief executive officer, president, chief financial officer, treasurer, general counsel or any assistant general counsel has actual knowledge or receives written notice thereof or (ii) any other officer of the Borrower charged with responsibility for the matter that is the subject of such notice requirement knows or should have known that such notice was required.

6.8           Environmental Laws.  (a)  Comply in all respects with, and ensure compliance in all respects by all tenants and subtenants, if any, with, all applicable Environmental Laws, and obtain and comply in all respects with and maintain, and ensure that all tenants and subtenants obtain and comply in all material respects with and maintain, any and all licenses, approvals, notifications, registrations or permits required by applicable Environmental Laws, except in any such case as such failure to comply or obtain would not reasonably be expected to have a Material Adverse Effect.

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(b)           Conduct and complete all investigations, studies, sampling and testing, and all remedial, removal and other actions required under material Environmental Laws and promptly comply in all material respects with all lawful orders and directives of all Governmental Authorities regarding Environmental Laws.

6.9           Further Assurances.  From time to time execute and deliver, or cause to be executed and delivered, such additional instruments, certificates or documents, and take such actions, as the Administrative Agent may reasonably request for the purposes of implementing or effectuating the provisions of this Agreement and the other Loan Documents, or of more fully perfecting or renewing the rights of the Administrative Agent and the Lenders with respect to the Collateral (or with respect to any additions thereto or replacements or proceeds thereof or with respect to any other property or assets hereafter acquired by the Borrower which may be deemed to be part of the Collateral) pursuant hereto or thereto.  Upon the exercise by the Administrative Agent or any Lender of any power, right, privilege or remedy pursuant to this Agreement or the other Loan Documents which requires any consent, approval, recording, qualification or authorization of any Governmental Authority, the Borrower will execute and deliver, or will cause the execution and delivery of, all applications, certifications, instruments and other documents and papers that the Administrative Agent or such Lender may be required to obtain from the Borrower or any of its Subsidiaries for such governmental consent, approval, recording, qualification or authorization.

6.10         Credit Ratings.  Use commercially reasonable efforts to maintain ratings by both Moody’s and Standard & Poor’s with respect to the Facilities.

6.11         Excluded Subsidiaries.  (i) Maintain, and cause to be maintained, the books and records and bank accounts of the Borrower and its Subsidiaries separate from the books and records and bank accounts of the Excluded Subsidiaries, and at all times present the Excluded Subsidiaries to the public as separate and distinct legal entities; (ii) maintain, and cause to be maintained, financial statements of the Excluded Subsidiaries separate from those of the Borrower and its Subsidiaries; (iii) cause the Excluded Subsidiaries to hold title to any assets they own in their own respective name, and deposit all of their respective funds in checking accounts, saving accounts, time deposits or certificates of deposit in their respective names or invest such funds in their respective names; (iv) cause the Excluded Subsidiaries to observe all corporate formalities under Requirements of Law necessary to maintain their identity as entities separate and distinct from the Borrower and its Subsidiaries; and (v) not commingle the assets of Borrower or any Subsidiary with assets of any Excluded Subsidiary.

SECTION 7.           NEGATIVE COVENANTS

The Borrower hereby agrees that, so long as the Commitments remain in effect, any Letter of Credit remains outstanding or any Loan or other Obligation is owing to any Lender or any Agent hereunder, the Borrower shall not, and shall not permit any of its Subsidiaries to, directly or indirectly:

7.1           Financial Condition Covenants.

(a)           Consolidated Interest Coverage Ratio.  Permit the Consolidated Interest Coverage Ratio for any period of four consecutive fiscal quarters of the Borrower (or, for any

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period ending with or prior to FQ3 2005, as provided in the definition of Consolidated Interest Expense) ending with any fiscal quarter set forth below to be less than the ratio set forth below opposite such fiscal quarter: 

Fiscal Quarter	Consolidated Interest Coverage Ratio
FQ1 2005 through FQ3 2005	2.50x
FQ4 2005 through FQ3 2006	2.75x
FQ4 2006 through FQ3 2009	3.25x
FQ4 2009 and thereafter	3.50x

(b)           Consolidated Debt to Capitalization Ratio.  Permit the Consolidated Debt to Capitalization Ratio for any period of the Borrower ending with any fiscal quarter set forth below to exceed the ratio set forth below opposite such fiscal quarter:

Fiscal Quarter	Consolidated Debt to Capitalization Ratio
FQ1 2005 through FQ2 2005	60.0	%
FQ3 2005 through FQ3 2006	58.5	%
FQ4 2006 through FQ3 2009	57.0	%
FQ4 2009 and thereafter	55.0	%

7.2           Limitation on Indebtedness.  Create, incur, assume or suffer to exist any Indebtedness, except:

(a)           Indebtedness of the Borrower pursuant to any Loan Document;

(b)           Indebtedness of the Borrower to any Subsidiary, Indebtedness of any Subsidiary to any other Subsidiary and, to the extent permitted under Section 7.7(k), Indebtedness of any Subsidiary to the Borrower;

(c)           Indebtedness (including, without limitation, Capital Lease Obligations) secured by Liens permitted by Section 7.3(g) in an aggregate principal amount not to exceed $15,000,000 at any one time outstanding;

(d)           Indebtedness outstanding on the date hereof and listed on Schedule 7.2(d) and any refinancings, refundings, renewals or extensions thereof (without any increase in the principal amount thereof or any shortening of the maturity of any principal amount thereof);

(e)           Guarantee Obligations made in the ordinary course of business by the Borrower or any of its Subsidiaries of obligations of  the Borrower or any of its Subsidiaries;

(f)            the Senior Notes in an aggregate principal amount not to exceed $225 million and, subject to Section 7.8. any refinancings, refundings, renewals or extensions

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thereof (without any increase in the principal amount thereof or any shortening of the maturity of any principal amount thereof);

(g)           Receivables Facility Attributed Indebtedness in an aggregate principal amount not to exceed $70,000,000 any one time outstanding;

(h)           Indebtedness of the Borrower incurred or assumed in connection with Permitted Acquisitions; provided that any such Indebtedness incurred by the Borrower, or assumed by the Borrower if incurred in conjunction with such Acquisition, shall not mature or have any scheduled amortization (in excess of 1% per annum) prior to April 30, 2012;

(i)            additional Indebtedness of the Borrower or any of its Subsidiaries in an aggregate principal amount (for the Borrower and all Subsidiaries) not to exceed $10,000,000 at any one time outstanding;

(j)            Indebtedness (not constituting or supporting Funded Debt) consisting of contingent reimbursement obligations of the Borrower or any of its Subsidiaries under surety, indemnity, performance, release and appeal bonds and guaranties thereof and under letters of credit required in the ordinary course of business or in connection with the enforcement of rights or claims of the Borrower or any of its Subsidiaries;

(k)           Non-Recourse Debt of a Subsidiary;

(l)            Indebtedness of the Borrower or any Subsidiary evidenced by mortgage bonds issued under and secured by an indenture executed after the date hereof, provided that (i) the Lien of such indenture covers only assets acquired by the Borrower and its Subsidiaries after the date hereof (and, in any event, does not cover any assets which are covered by the Lien of either Indenture nor which constitute a part of the Montana Utility Business or the South Dakota Utility Business), (ii) the proceeds of such issuance shall be used to finance the purchase of new utility assets (or capital expenditures with respect thereto), and (iii) after giving effect to such incurrence, the Borrower shall be in compliance with the provisions of Section 7.1;

(m)          Indebtedness of the Borrower evidenced by first mortgage bonds under an Indenture incurred after the date hereof, provided that (i) such Indebtedness refinances or replaces then outstanding first mortgage bonds issued under such Indenture (without any increase in the principal amount thereof or any shortening of the maturity of any principal amount thereof) or (ii) the proceeds of such Indebtedness are used solely to finance QF Liabilities or capital expenditures of the Borrower with respect to assets subject to the Lien of such Indenture (any of which capital expenditures are made or incurred after the date hereof) in accordance with the terms of such Indenture and so long as, in the case of this clause (ii), (1) such first mortgage bonds are issued on the basis of Property Additions (as such term is defined in such Indenture) in compliance with such Indenture, (2) in the case of QF Liabilities, the aggregate principal amount of such first mortgage bonds (together with the aggregate principal amount of Indebtedness incurred pursuant to Section 7.2(o) below) does not exceed in the aggregate $180 million and (3) any such

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Indebtedness shall not mature or have any scheduled amortization (in excess of 1% per annum) prior to April 30, 2012;

(n)           Indebtedness of the Borrower constituting contingent reimbursement obligations with respect to the Existing Letters of Credit; provided that the face amount of the Existing Letters of Credit shall not be increased nor shall any Existing Letter of Credit be renewed or extended; and

(o)           Indebtedness incurred to refinance QF Liabilities so long as (i) the aggregate principal amount of such Indebtedness (together with the aggregate principal amount of first mortgage bonds issued pursuant to Section 7.2(m)(ii) with respect to QF Liabilities) does not exceed in the aggregate $180 million and (ii) any such Indebtedness shall not mature or have any scheduled amortization (in excess of 1% per annum) prior to April 30, 2012.

7.3           Limitation on Liens.  Create, incur, assume or suffer to exist any Lien upon any of its Property, whether now owned or hereafter acquired, except for:

(a)           Liens for taxes not yet due or that are being contested in good faith, provided that adequate reserves with respect thereto are maintained on the books of the Borrower or its Subsidiaries, as the case may be, in conformity with GAAP;

(b)           landlord liens for rent not yet due and payable, and carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s or other like Liens arising in the ordinary course of business that are not overdue for a period of more than 60 days or that are being contested in good faith;

(c)           pledges or deposits in connection with workers’ compensation, unemployment insurance and other social security legislation;

(d)           deposits to secure liability to insurance carriers under insurance or self-insurance arrangements, and deposits to secure the performance of bids, trade contracts (other than for borrowed money), leases, statutory obligations, surety and appeal bonds, performance bonds and other obligations of a like nature incurred in the ordinary course of business;

(e)           easements, rights-of-way, restrictions and other similar encumbrances incurred in the ordinary course of business that, in the aggregate, do not in any case materially detract from the value of the Property subject thereto or materially interfere with the ordinary conduct of the business of the Borrower and its Subsidiaries taken as a whole;

(f)            Liens in existence on the date hereof listed on Schedule 7.3, provided that no such Lien is spread to cover any additional Property after the Closing Date and that the amount of Indebtedness secured thereby is not increased;

(g)           Liens securing Indebtedness of the Borrower or any Subsidiary incurred pursuant to Section 7.2(c) to finance the acquisition of fixed or capital assets, provided

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that (i) such Liens shall be created substantially simultaneously with the acquisition of such fixed or capital assets, (ii) such Liens do not at any time encumber any Property other than the Property financed by such Indebtedness, (iii) the amount of Indebtedness secured thereby is not increased and (iv) such Indebtedness is permitted under Section 7.2(c);

(h)           Liens securing Indebtedness of the Borrower incurred or assumed in connection with any Permitted Acquisition, provided that (i) such Liens do not at any time encumber any Property other than the Property acquired in connection with such Permitted Acquisition, (ii) the amount of Indebtedness secured thereby is not increased and (iii) such Indebtedness is permitted to be incurred under Section 7.2(h) or (l);

(i)            Liens created pursuant to the Security Documents and the Lien created pursuant to the Senior Note Indenture with respect to the first mortgage bonds issued in connection with the Senior Notes;

(j)            any interest or title of a lessor under any lease entered into by the Borrower or any other Subsidiary in the ordinary course of its business and covering only the assets so leased;

(k)           the Lien of each Indenture, as such Indenture may be amended or supplemented from time to time in accordance with the terms hereof, securing first mortgage bonds outstanding on the date hereof and listed on Schedule 7.2(d) or permitted to be outstanding hereafter pursuant to Section 7.2(a) or (m);

(l)            Liens on accounts receivables of the Borrower (provided such assets are not subject to the Lien of either Indenture) and Liens on assets of an SPV, in each case securing Indebtedness permitted to be outstanding pursuant to Section 7.2(g);

(m)          any Lien vested in any licensor or permitter for obligations or acts to be performed, the performance of which obligations or acts is required under licenses or permits, so long as the performance of such obligations or acts is not delinquent or is being contested in good faith and by appropriate proceedings;

(n)           any controls, restrictions, obligations, duties or other burdens imposed by any federal, state, municipal or other law, or by any rule, regulation or order of any Governmental Authority, upon any property of the Borrower or the operation or use thereof or upon the Borrower with respect to any of its property or the operation or use thereof or with respect to any franchise, grant, license, permit or public purpose requirement, or any rights reserved to or otherwise vested in any Governmental Authority to impose any such controls, restrictions, obligations, duties or other burdens;

(o)           any right which any Governmental Authority may have by virtue of any franchise, license, contract or statute to purchase, or designate a purchaser of or order the sale of, any property of the Borrower upon payment of cash or reasonable compensation therefor or to terminate any franchise, license or other rights or to regulate the property and business of the Borrower;

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(p)           party-wall agreements and agreements, in each case existing on the date hereof, for and obligations relating to the joint or common use of property owned solely by the Borrower or owned by the Borrower in common or jointly with one or more parties;

(q)           Liens existing on the date hereof securing indebtedness incurred by a Person, other than the Borrower which indebtedness has been neither assumed nor guaranteed by the Borrower nor on which it customarily pays interest, existing on property which the Borrower owns jointly or in common with such Person or such Person and others, if there is a bar against partition of such property which would preclude the sale of such property by such other Person or the holder of such lien without the consent of the Borrower;

(r)            Liens not otherwise permitted by this Section 7.3 so long as neither (i) the aggregate outstanding principal amount of the obligations secured thereby nor (ii) the aggregate fair market value (determined, in the case of each such Lien, as of the date such Lien is incurred) of the assets subject thereto exceeds (as to the Borrower and all Subsidiaries) $10,000,000 at any one time;

(s)           any attachment or judgment Lien not constituting an Event of Default;

(t)            Liens solely on assets of a Subsidiary incurring Indebtedness permitted under Section 7.2, which Liens secure such Indebtedness;

(u)           Liens on Mortgaged and Pledged Property (as defined in the Montana First Mortgage Indenture) not securing Indebtedness which Liens constitute Excepted Encumbrances (as defined in the Montana First Mortgage Indenture);

(v)           Liens on Mortgaged Property (as defined in the South Dakota First Mortgage Indenture) not securing Indebtedness which Liens constitute Permitted Liens (as defined in the South Dakota First Mortgage Indenture) other than of the type set forth in clause (a) or (q) of the definition of “Permitted Liens” set forth in the South Dakota First Mortgage Indenture; and

(w)          Liens on assets other than Mortgaged Property (as defined in the South Dakota First Mortgage Indenture) or Mortgaged and Pledged Property (as defined in the Montana First Mortgage Indenture) securing contingent obligations of the Borrower under Hedge Agreements permitted pursuant to Section 7.19.

7.4           Limitation on Fundamental Changes.  Enter into any merger, consolidation or amalgamation, or liquidate, wind up or dissolve itself (or suffer any liquidation or dissolution), Dispose of all or substantially all of its Property or business or, in the case of the Borrower, Dispose of all or substantially all of the South Dakota Utility Business or the Montana Utility Business, except that:

(a)           any Subsidiary of the Borrower may be merged or consolidated with or into the Borrower (provided that the Borrower shall be the continuing or surviving corporation);

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(b)           any Subsidiary of the Borrower may Dispose of any or all of its assets (upon voluntary liquidation or otherwise) to the Borrower; and

(c)           the Borrower or any Subsidiary of the Borrower may merge or consolidate with any Person in consummation of a Permitted Acquisition (provided that in the case of the Borrower, the Borrower shall be the surviving or continuing corporation).

7.5           Limitation on Disposition of Property.  Dispose of any of its Property (including, without limitation, receivables and leasehold interests), whether now owned or hereafter acquired, or, in the case of any Subsidiary, issue or sell any shares of such Subsidiary’s Capital Stock to any Person, except:

(a)           the Disposition of equipment that, in the reasonable judgment of the Borrower, has become uneconomic, obsolete or worn out and which is Disposed of in the ordinary course of business;

(b)           the sale of inventory in the ordinary course of business;

(c)           Dispositions permitted by Section 7.4(b);

(d)           the sale or issuance of any Subsidiary’s Capital Stock to the Borrower;

(e)           Dispositions of assets released from the Lien of an Indenture in accordance with clauses (i) or (ii) of Section 7.10;

(f)            Dispositions of (i) all of any portion of the interest of the Borrower or any of its Subsidiaries in Colstrip or (ii) the assets of, or Capital Stock or debt interests in, Montana Megawatts I, LLC and other entities formed for the Montana First Megawatts Project;

(g)           Dispositions of existing equity or debt interests in any Excluded Subsidiary (including any sale or liquidation of the promissory note payable from Cornerstone to the Borrower);

(h)           any transfer of an interest in Receivables, Receivables and Related Security, accounts or notes receivable under any Receivables Purchase Document (including related transfers thereof to an SPV);

(i)            the Disposition of other assets having a fair market value not to exceed $20,000,000 in the aggregate;

(j)            any Recovery Event; and

(k)           Dispositions of assets released from the Lien of an Indenture in accordance with the terms of such Indenture (other than in accordance with clause (e) above), so long as (i) no Default or Event of Default then exists, (ii) (y) the Consolidated Interest Coverage Ratio and Consolidated Debt to Capitalization Ratio of the Borrower after giving effect to such Disposition, calculated on a pro forma basis as of the end of the

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quarter most recently ended prior to the date of such Disposition and for the four fiscal quarters then ending, shall be equal to or better than the Consolidated Interest Coverage Ratio and Consolidated Debt to Capitalization Ratio of the Borrower prior to giving effect to such Disposition for such period and (z) after giving effect to such Disposition, the Borrower shall be in compliance with the provisions of Section 7.1, calculated on a pro forma basis as of the end of the quarter most recently ended prior to the date of such Disposition and for the four fiscal quarters then ending (and, if the aggregate consideration (including cash consideration and the fair value of any non-cash consideration and Indebtedness assumed) for such Disposition exceeds $25 million, the Borrower shall have delivered to the Administrative Agent a Compliance Certificate demonstrating such pro forma compliance), and (iii) the Net Cash Proceeds of such Disposition are used to repay the Loans or reinvested in the Montana Utility Business (in the case of Dispositions of assets under the Montana Indenture) or the South Dakota Utility Business (in the case of Dispositions of assets under the South Dakota Indenture) in each case in accordance with the terms of Section 2.12(b) (and, notwithstanding Section 2.12(d), in the event the Borrower prepays Revolving Credit Loans (or would have been obligated pursuant to Section 2.12(b) to prepay Revolving Credit Loans had they been then outstanding), the Borrower shall permanently reduce the Revolving Credit Commitments by such amount);

provided, that with respect to Dispositions pursuant to clause (f), (g), (i), (j) and (k) of this Section 7.5, the requirements of Section 2.12(b) are complied with in connection therewith.

7.6           Limitation on Restricted Payments.  Declare or pay any dividend on, or make any payment on account of, or set apart assets for a sinking or other analogous fund for, the purchase, redemption, defeasance, retirement or other acquisition of, any Capital Stock of the Borrower or any Subsidiary, whether now or hereafter outstanding, or make any other distribution in respect thereof, either directly or indirectly, whether in cash or property or in obligations of the Borrower or any Subsidiary, or enter into any derivatives or other transaction with respect to any Capital Stock of the Borrower or any Subsidiary with any financial institution, commodities or stock exchange or clearinghouse (a “Derivatives Counterparty”) obligating the Borrower or any Subsidiary to make payments to such Derivatives Counterparty as a result of any change in market value of any such Capital Stock (collectively, “Restricted Payments”), except that:

(a)           any Subsidiary may make Restricted Payments to the Borrower;

(b)           the Borrower may make Restricted Payments in the form of common stock of the Borrower;

(c)           the Borrower may purchase the Borrower’s common stock or common stock options from present or former officers or employers of the Borrower or any Subsidiary upon the death, disability or termination of employment of such officer or employer, provided, that the aggregate amount of payments under this paragraph subsequent to the date hereof (net of any proceeds received by the Borrower subsequent to the date hereof in connection with resales of any common stock or common stock options so purchased) shall not exceed $5,000,000 in the twelve month period

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commencing on the date hereof and $2,500,000 in any subsequent twelve month period; and

(d)           so long as no Default or Event of Default shall have occurred and be continuing, the Borrower may declare and pay regular quarterly cash dividends in respect of its common stock in an aggregate amount not to exceed (i) $8 million during FQ4 2004 and (ii) for any fiscal year of the Borrower, 50% of the Excess Cash Flow of the Borrower and its Subsidiaries for such fiscal year, except that until the first to occur of (A) the date that is two years from the date hereof and (B) the Borrower having achieved ratings on the Facilities of at least Baa3 (stable outlook) and BBB- (stable outlook) by Moody’s and Standard & Poor’s, respectively, such aggregate amount is not to exceed 45% of the Excess Cash Flow of the Borrower and its Subsidiaries for such fiscal year; provided that in each case, after giving effect to such payment, the Borrower shall be in compliance with the provisions of Section 7.1;

7.7           Limitation on Investments.  Make any advance, loan, extension of credit (by way of guaranty or otherwise) or capital contribution to, or purchase any Capital Stock, bonds, notes, debentures or other debt securities of, or any assets constituting an ongoing business from, or make any other investment in, any other Person (all of the foregoing, “Investments”), except:

(a)           extensions of trade credit in the ordinary course of business;

(b)           Investments in Cash Equivalents;

(c)           Investments arising in connection with the incurrence of Indebtedness permitted by Section 7.2(b) and (e);

(d)           loans and advances to employees of the Borrower or any Subsidiaries of the Borrower in the ordinary course of business (including, without limitation, for travel, entertainment and relocation expenses) in an aggregate amount for the Borrower and Subsidiaries of the Borrower not to exceed $3,000,000 at any one time outstanding;

(e)           Investments in assets useful in the Borrower’s business made by the Borrower or, if the applicable Recovery Event related to assets of a Subsidiary, by any of its Subsidiaries with the proceeds of any Reinvestment Deferred Amount;

(f)            Investments (other than those relating to the incurrence of Indebtedness permitted by Section 7.7(c)) by the Borrower or any of its Subsidiaries in the Borrower;

(g)           Investments in respect of Permitted Acquisitions;

(h)           in addition to Investments otherwise expressly permitted by this Section, Investments by the Borrower or any of its Subsidiaries in an aggregate amount (valued at cost) not to exceed $10,000,000 during the term of this Agreement;

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(i)            Investments existing on the date hereof and described on Schedule 7.7, including the receipt of any additional securities constituting payment in kind on such existing Investments;

(j)            Investments in obligations arising out of bankruptcy of customers and suppliers;

(k)           Investments of the Borrower or any Subsidiary of the Borrower in any Subsidiary of the Borrower or any Excluded Subsidiary; provided that Investments of the Borrower permitted pursuant to this Section 7.7(k) (which shall include any Letters of Credit issued for the account (or otherwise to support obligations) of any Subsidiary or any Excluded Subsidiary) and any Indebtedness of any Subsidiary owing to the Borrower permitted pursuant to Section 7.2) shall not at any time exceed $60,000,000 in the aggregate (or if as of the date of such Investment the Facilities are rated at least Baa3 (stable outlook) and BBB- (stable outlook) by Moody’s and Standard & Poor’s, respectively, then $90,000,000 in the aggregate) in each case net of any return of capital (or repayment of principal) actually received by the Borrower; and

(l)            Investments arising out of non-cash consideration received in connection with Dispositions permitted under Section 7.5(f) or (g);

provided that, notwithstanding the foregoing, the Borrower shall not, and shall not permit any Subsidiary to, make any Investment in any Excluded Subsidiary nor create, incur, assume or suffer to exist any Guarantee Obligation with respect to any Excluded Subsidiary other than as permitted in clause (k) above.

7.8           Limitation on Optional Payments and Modifications of Debt Instruments, etc.  (a) At any time during the existence of a Default or an Event of Default, make or offer to make any optional or voluntary payment, prepayment, repurchase or redemption of, or otherwise voluntarily or optionally defease, the Senior Notes or any first mortgage bonds issued and outstanding under an Indenture, or segregate funds for any such payment, prepayment, repurchase, redemption or defeasance, or enter into any derivative or other transaction with respect to the Senior Notes or any first mortgage bonds with any Derivatives Counterparty obligating the Borrower or any Subsidiary to make payments to such Derivatives Counterparty as a result of any change in market value of the Senior Notes or any first mortgage bonds issued and outstanding under an Indenture other than any payment or repurchase thereof solely in exchange for common stock of the Borrower, (b) amend, modify or otherwise change, or consent or agree to any amendment, modification, waiver or other change to, any of the terms of the Senior Notes or any first mortgage bonds issued and outstanding under an Indenture the effect of which is (i) to shorten the maturity or the average life of the principal thereof, (ii) to expand (or add) any obligation thereunder to make any mandatory prepayments of principal thereof, (iii) to increase the yield thereon (by increasing the rate of interest applicable thereto or otherwise) or to accelerate the date for payment of interest thereon or (iv) to amend (or add) any covenant or other restriction applicable to the Borrower or any of its Subsidiaries thereunder if, after giving effect to such amendment, the terms of the Senior Notes or such first mortgage bonds are more onerous, taken as a whole, than the terms hereof, or (c) amend its certificate of incorporation in any manner determined by the Administrative Agent to be adverse to the Lenders.

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7.9           Limitation on Transactions with Affiliates.  Other than any transaction set forth on Schedule 7.9, enter into any transaction, including, without limitation, any purchase, sale, lease or exchange of Property, the rendering of any service or the payment of any management, advisory or similar fees, with any Affiliate (other than the Borrower and its Subsidiaries but including, without limitation, each Excluded Subsidiary) unless such transaction is (a) otherwise permitted under this Agreement, (b) in the ordinary course of business of the Borrower or such Subsidiary, as the case may be, and (c) upon fair and reasonable terms no less favorable to the Borrower or such Subsidiary, as the case may be, than it would obtain in a comparable arm’s length transaction with a Person that is not an Affiliate.

7.10         Limitation on Release of Mortgaged Property; Limitation in Respect of Insurance.  Release Mortgaged and Pledged Property (as defined in the Montana First Mortgage Indenture) from the Lien of the Montana First Mortgage Indenture or Mortgaged Property (as defined in the South Dakota First Mortgage Indenture) from the Lien of the South Dakota First Mortgage Indenture, other than (i) releases of such Mortgaged and Pledged Property pursuant to and in accordance with Sections 58 and 60 of the Montana First Mortgage Indenture; (ii) releases of such Mortgaged Property pursuant to and in accordance with Section 8.02 of the South Dakota First Mortgage Indenture other than clause (f) thereof; (iii) releases of property or other assets that are disposed of in accordance with Section 7.5(i) and, if in connection with any such disposition and the related release, the Borrower deposits with the trustee under an Indenture cash that would otherwise constitute Net Cash Proceeds, releases of such cash pursuant to and in accordance with such Indenture; and (iv) releases of property, insurance proceeds (and/or moneys of the Borrower in lieu thereof or in addition thereto) and/or other cash or other assets that are permitted by the terms of the Indentures; provided, however, that (A) property (other than cash or Cash Equivalents) released as contemplated in this clause (iv) shall be promptly disposed of after such release in accordance with Section 7.5(i) or 7.5(k) and (B) cash or Cash Equivalents that have been released shall be treated as Net Cash Proceeds from Assets Sales and applied (or reinvested) as required pursuant to Section 2.12; provided, further, however, that the Borrower shall not request or receive any proceeds of any insurance or of any alternative method or plan of protection of the Borrower relating to the Mortgaged Property otherwise payable to it pursuant to Section 6.07(b) of the South Dakota First Mortgage Indenture, and so long as any First Mortgage Bonds are outstanding, no effect shall be given to (x) Section 6.07(b) of the South Dakota First Mortgage Indenture, (y) the language in Section 6.07(c) of the South Dakota First Mortgage Indenture which precedes clause (i) of such Section, or (z) the reference to Section 6.07(b) of the South Dakota First Mortgage Indenture which appears in Section 6.07(d) of the South Dakota First Mortgage Indenture; provided, further, however, that the Borrower shall not release Mortgaged Property (as defined in the South Dakota First Mortgage Indenture) from the Lien of the South Dakota First Mortgage Indenture pursuant to Section 8.03 of the South Dakota First Mortgage Indenture.

7.11         Limitation on Subjecting Property or Other Assets to the Lien of the Other Indenture.  Subject any property or other assets to the Lien of the Montana First Mortgage Indenture or the Lien of the South Dakota First Mortgage Indenture if such property or other assets are subject to the lien of the other Indenture.

7.12         Prohibition on Designating Class “A” Mortgages or Permitting Qualified Lien Bonds to Exist.  Designate any Class “A” Mortgage under the South Dakota First Mortgage

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Indenture or permit any Qualified Lien Bonds to exist under the Montana First Mortgage Indenture.

7.13         Limitation on Amendments or Supplements to the Indentures.  Amend, modify or supplement the Montana First Mortgage Indenture or the South Dakota First Mortgage Indenture, except to (a) supplement such Indenture to establish the terms of any series of first mortgage bonds to be issued thereunder that are permitted to be issued under Section 7.2, (b) amend or supplement such Indenture for the purpose of conveying, transferring or assigning to the trustee thereunder additional property (or confirming the conveyance, transfer or assignment to the trustee thereunder) for the purpose of subjecting such property to the lien of such Indenture (or confirming, approving, perfecting or maintaining the Lien of such Indenture on any property), subject to the terms of Section 7.11, (c) amend or supplement such Indenture, in the case of the Montana First Mortgage Indenture, pursuant to and as permitted by Section 120 thereof or, in the case of the South Dakota First Mortgage Indenture, pursuant and as permitted by Section 14.01 thereof, in each case so long as such amendment or supplement will not adversely affect the First Mortgage Bonds in any material respect, or (d) amend or supplement such Indenture, in the case of the Montana First Mortgage Indenture, pursuant to and as permitted by Article XIX thereof or, in the case of the South Dakota First Mortgage Indenture, pursuant and as permitted by Section 14.02 thereof, in each case so long as such amendment or supplement is otherwise not prohibited hereunder and does not, and could not reasonably be expected to, cause a Material Adverse Effect or otherwise adversely affect, in any material respect, interests of the Collateral Agent as holder of the First Mortgage Bonds issued under such Indenture or the benefits of the security intended to be afforded to the First Mortgage Bonds under such Indenture.

7.14         Prohibition on Second Mortgage Bonds.  Issue any bonds (or other Indebtedness) that is secured by a Lien (subordinate to the Lien of either Indenture) on the property or other assets subject to the Lien of such Indenture.

7.15         Limitation on Changes in Fiscal Periods.  Permit the fiscal year of the Borrower to end on a day other than December 31 or change the Borrower’s method of determining fiscal quarters.

7.16         Limitation on Negative Pledge Clauses.  Enter into or suffer to exist or become effective any agreement that prohibits or limits the ability of the Borrower or any of its Subsidiaries to create, incur, assume or suffer to exist any Lien upon any of its Property or revenues, whether now owned or hereafter acquired, to secure the Obligations other than (a) this Agreement and the other Loan Documents, (b) the Indentures, (c) the Senior Notes, (d) any agreements governing any purchase money Liens or Capital Lease Obligations otherwise permitted hereby (in which case, any prohibition or limitation shall only be effective against the assets financed thereby) and (e) any other agreement listed on Schedule 7.16.

7.17         Limitation on Restrictions on Subsidiary Distributions.  Enter into or suffer to exist or become effective any consensual encumbrance or restriction on the ability of any Subsidiary to (a) make Restricted Payments in respect of any Capital Stock of such Subsidiary held by, or pay any Indebtedness owed to, the Borrower or any other Subsidiary, (b) make Investments in the Borrower or any other Subsidiary or (c) transfer any of its assets to the

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Borrower or any other Subsidiary, except for such encumbrances or restrictions existing under or by reason of (i) any restrictions existing under the Loan Documents, (ii) any restrictions existing under the Indentures, (iii) any restrictions existing under the Senior Notes and (iv) any restrictions with respect to a Subsidiary imposed pursuant to an agreement that has been entered into in connection with the Disposition of all or substantially all of the Capital Stock or assets of such Subsidiary.

7.18         Limitation on Lines of Business.  Enter into any business, either directly or through any Subsidiary, except for those businesses in which the Borrower and its Subsidiaries are engaged on the date of this Agreement or that are reasonably related thereto.

7.19         Limitation on Hedge Agreements.  Enter into any Hedge Agreement (or any commodity contract or similar arrangements providing for protection against fluctuations in commodity prices, either generally or under specific contingencies) other than such agreements, contracts or arrangements entered into in the ordinary course of business, and not for speculative purposes, to protect against changes in interest rates, commodity prices or foreign exchange rates.

SECTION 8.  EVENTS OF DEFAULT

If any of the following events shall occur and be continuing:

(a)           the Borrower shall fail to pay any principal of any Loan or Reimbursement Obligation when due in accordance with the terms hereof; or the Borrower shall fail to pay any interest on any Loan or Reimbursement Obligation, or any other amount payable hereunder or under any other Loan Document, within five days after any such interest or other amount becomes due in accordance with the terms hereof or thereof; or

(b)           any representation or warranty made or deemed made by the Borrower herein or in any other Loan Document or that is contained in any certificate, document or financial or other statement furnished by it at any time under or in connection with this Agreement or any such other Loan Document shall prove to have been inaccurate in any material respect on or as of the date made or deemed made or furnished; or

(c)           the Borrower shall default in the observance or performance of any agreement contained in clause (i) or (ii) of Section 6.4 (a) (with respect to the Borrower only) or Section 7 of this Agreement; or

(d)           the Borrower shall default in the observance or performance of any other agreement contained in this Agreement or any other Loan Document (other than the Supplemental Indentures), other than as provided in paragraphs (a) through (c) of this Section, and such default shall continue unremedied for a period of 30 days; or

(e)           the Borrower or any of its Subsidiaries shall (i) default in making any payment of any principal of, or interest on, any Indebtedness (including, without limitation, any Guarantee Obligation, but excluding the Loans and Reimbursement Obligations) beyond the period of grace, if any, provided in the instrument or agreement under which such Indebtedness was created; or (ii) default in the observance or

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performance of any other agreement or condition relating to any such Indebtedness or contained in any instrument or agreement evidencing, securing or relating thereto, or any other event shall occur or condition exist, the effect of which default or other event or condition is to cause, or to permit the holder or beneficiary of such Indebtedness (or a trustee or agent on behalf of such holder or beneficiary) to cause, with the giving of notice if required, such Indebtedness to become due prior to its stated maturity or to become subject to a mandatory offer to purchase by the obligor thereunder or (in the case of any such Indebtedness constituting a Guarantee Obligation) to become payable; provided, that a default, event or condition described in clause (i) or (ii) of this paragraph (e) shall not at any time constitute an Event of Default unless, at such time, one or more defaults, events or conditions of the type described in clauses (i) and (ii) of this paragraph (e) shall have occurred and be continuing with respect to Indebtedness the outstanding principal amount of which exceeds in the aggregate $15,000,000; or

(f)            (i) the Borrower or any of its Subsidiaries shall commence any case, proceeding or other action (A) under any existing or future law of any jurisdiction, domestic or foreign, relating to bankruptcy, insolvency, reorganization or relief of debtors, seeking to have an order for relief entered with respect to it, or seeking to adjudicate it a bankrupt or insolvent, or seeking reorganization, arrangement, adjustment, winding-up, liquidation, dissolution, composition or other relief with respect to it or its debts, or (B) seeking appointment of a receiver, trustee, custodian, conservator or other similar official for it or for all or any substantial part of its assets, or the Borrower or any of its Subsidiaries shall make a general assignment for the benefit of its creditors; or (ii) there shall be commenced against the Borrower or any of its Subsidiaries any case, proceeding or other action of a nature referred to in clause (i) above that (A) results in the entry of an order for relief or any such adjudication or appointment or (B) remains undismissed, undischarged or unbonded for a period of 60 days; or (iii) there shall be commenced against the Borrower or any of its Subsidiaries any case, proceeding or other action seeking issuance of a warrant of attachment, execution, distraint or similar process against all or any substantial part of its assets that results in the entry of an order for any such relief that shall not have been vacated, discharged, or stayed or bonded pending appeal within 60 days from the entry thereof; or (iv) the Borrower or any of its Subsidiaries shall take any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any of the acts set forth in clause (i), (ii), or (iii) above; or (v) the Borrower or any of its Subsidiaries shall generally not, or shall be unable to, or shall admit in writing its inability to, pay its debts as they become due; or

(g)           (i) any Person shall engage in any “prohibited transaction” (as defined in Section 406 of ERISA or Section 4975 of the Code) involving any Plan, (ii) any “accumulated funding deficiency” (as defined in Section 302 of ERISA), whether or not waived, shall exist with respect to any Plan, or any Lien in favor of the PBGC or a Plan shall arise on the assets of the Borrower or any Commonly Controlled Entity, (iii) a Reportable Event shall occur with respect to, or proceedings shall commence to have a trustee appointed, or a trustee shall be appointed, to administer or to terminate, any Single Employer Plan, which Reportable Event or commencement of proceedings or appointment of a trustee is, in the reasonable opinion of the Required Lenders, likely to result in the termination of such Plan for purposes of Title IV of ERISA in an involuntary

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or distress termination, (iv) any Single Employer Plan shall terminate for purposes of Title IV of ERISA, (v) the Borrower or any Commonly Controlled Entity shall, or in the reasonable opinion of the Required Lenders shall be likely to, incur any liability in connection with a withdrawal from, or the Insolvency or Reorganization of, a Multiemployer Plan or (vi) any other event or condition shall occur or exist with respect to a Plan; and in each case in clauses (i) through (vi) above, such event or condition, together with all other such events or conditions, if any, could, in the sole judgment of the Required Lenders, reasonably be expected to have a Material Adverse Effect; or

(h)           one or more judgments or decrees shall be entered against the Borrower or any of its Subsidiaries involving for the Borrower and its Subsidiaries taken as a whole a liability (to the extent not covered by insurance as to which the relevant insurance company has acknowledged coverage) of $15,000,000 or more, and all such judgments or decrees shall not have been vacated, discharged, stayed or bonded pending appeal within 30 days from the entry thereof; or

(i)            any of the Security Documents or either Indenture shall cease, for any reason, to be in full force and effect, or the Borrower or any Subsidiary of the Borrower shall so assert, or any Lien created by any of the Security Documents or either Indenture shall cease to be enforceable and of the same effect and priority purported to be created thereby other than with respect to collateral which is, in the aggregate, de minimus; or

(j)            there shall occur an “Event of Default” under the South Dakota First Mortgage Indenture or the Senior Note Indenture or a “Default” under the Montana First Mortgage Indenture; provided that the waiver or cure of such “Event of Default” under the South Dakota First Mortgage Indenture or such “Default” under the Montana First Mortgage Indenture, as the case may be, and the rescission and annulment of the consequences thereof under such Indenture will constitute a cure of the corresponding Event of Default hereunder and a rescission or annulment of the consequences thereof; or

(k)           any Change of Control shall occur; or

(l)            the Confirmation Order is vacated or modified after the date hereof in any manner that could reasonably be expected to (i) materially and adversely effect the Borrower’s ability to perform its obligations under the Loan Documents, or (ii) adversely affect the Lenders;

then, and in any such event, (A) if such event is an Event of Default specified in clause (i) or (ii) of paragraph (f) above with respect to the Borrower, automatically the Commitments shall immediately terminate and the Loans hereunder (with accrued interest thereon) and all other amounts owing under this Agreement and the other Loan Documents shall immediately become due and payable, and (B) if such event is any other Event of Default, either or both of the following actions may be taken:  (i) with the consent of the Majority Revolving Credit Facility Lenders, the Administrative Agent may, or upon the request of the Majority Revolving Credit Facility Lenders, the Administrative Agent shall, by notice to the Borrower declare the Revolving Credit Commitments to be terminated forthwith, whereupon the Revolving Credit Commitments shall immediately terminate; and (ii) with the consent of the Required Lenders, the

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

SECTION 9.  THE AGENTS

9.1           Appointment.  Each Lender hereby irrevocably designates and appoints the Agents (for the purposes of this Section 9 the term “Agents” shall also include any Issuing Lender acting in its capacity as such) as the agents of such Lender under this Agreement and the other Loan Documents, and each Lender irrevocably authorizes each Agent, in such capacity, to take such action on its behalf under the provisions of this Agreement and the other Loan Documents and to exercise such powers and perform such duties as are expressly delegated to such Agent by the terms of this Agreement and the other Loan Documents, together with such other powers as are reasonably incidental thereto.  Notwithstanding any provision to the contrary elsewhere in this Agreement, no Agent shall have any duties or responsibilities, except those expressly set forth herein, or any fiduciary relationship with any Lender, and no implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read into this Agreement or any other Loan Document or otherwise exist against any Agent.

9.2           Delegation of Duties.  Each Agent may execute any of its duties under this Agreement and the other Loan Documents by or through agents or attorneys-in-fact and shall be entitled to advice of counsel concerning all matters pertaining to such duties.  No Agent shall be responsible for the negligence or misconduct of any agents or attorneys-in-fact selected by it with reasonable care.

9.3           Exculpatory Provisions.  Neither any Agent nor any of its officers, directors, employees, agents, attorneys-in-fact or affiliates shall be (i) liable for any action lawfully taken or omitted to be taken by it or such Person under or in connection with this Agreement or any other Loan Document (except to the extent that any of the foregoing are found by a final and nonappealable decision of a court of competent jurisdiction to have resulted from its or such Person’s own gross negligence or willful misconduct) or (ii) responsible in any manner to any of the Lenders for any recitals, statements, representations or warranties made by the Borrower or any officer thereof contained in this Agreement or any other Loan Document or in any certificate, report, statement or other document referred to or provided for in, or received

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by the Agents under or in connection with, this Agreement or any other Loan Document or for the value, validity, effectiveness, genuineness, enforceability or sufficiency of this Agreement or any other Loan Document or for any failure of the Borrower to perform its obligations hereunder or thereunder.  The Agents shall not be under any obligation to any Lender to ascertain or to inquire as to the observance or performance of any of the agreements contained in, or conditions of, this Agreement or any other Loan Document, or to inspect the properties, books or records of the Borrower.

9.4           Reliance by Agents.  Each Agent shall be entitled to rely, and shall be fully protected in relying, upon any instrument, writing, resolution, notice, consent, certificate, affidavit, letter, telecopy, telex or teletype message, statement, order or other document or conversation believed by it to be genuine and correct and to have been signed, sent or made by the proper Person or Persons and upon advice and statements of legal counsel (including, without limitation, counsel to the Borrower), independent accountants and other experts selected by such Agent.  The Agents may deem and treat the payee of any Note as the owner thereof for all purposes unless such Note shall have been transferred in accordance with Section 10.7 and all actions required by such Section in connection with such transfer shall have been taken.  Each Agent shall be fully justified in failing or refusing to take any action under this Agreement or any other Loan Document unless it shall first receive such advice or concurrence of the Required Lenders (or, if so specified by this Agreement, all Lenders or any other instructing group of Lenders specified by this Agreement) as it deems appropriate or it shall first be indemnified to its satisfaction by the Lenders against any and all liability and expense that may be incurred by it by reason of taking or continuing to take any such action.  Each Agent shall in all cases be fully protected in acting, or in refraining from acting, under this Agreement and the other Loan Documents in accordance with a request of the Required Lenders (or, if so specified by this Agreement, all Lenders or any other instructing group of Lenders specified by this Agreement), and such request and any action taken or failure to act pursuant thereto shall be binding upon all the Lenders and all future holders of the Loans.

9.5           Notice of Default.  No Agent shall be deemed to have knowledge or notice of the occurrence of any Default or Event of Default hereunder unless such Agent shall have received notice from a Lender or the Borrower referring to this Agreement, describing such Default or Event of Default and stating that such notice is a “notice of default”.  In the event that the Administrative Agent shall receive such a notice, the Administrative Agent shall give notice thereof to the Lenders.  The Administrative Agent shall take such action with respect to such Default or Event of Default as shall be reasonably directed by the Required Lenders (or, if so specified by this Agreement, all Lenders or any other instructing group of Lenders specified by this Agreement); provided that unless and until the Administrative Agent shall have received such directions, the Administrative Agent may (but shall not be obligated to) take such action, or refrain from taking such action, with respect to such Default or Event of Default as it shall deem advisable in the best interests of the Lenders.

9.6           Non-Reliance on Agents and Other Lenders.  Each Lender expressly acknowledges that neither any of the Agents nor any of their respective officers, directors, employees, agents, attorneys-in-fact or affiliates have made any representations or warranties to it and that no act by any Agent hereafter taken, including any review of the affairs of the Borrower or any affiliate of the Borrower, shall be deemed to constitute any representation or

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warranty by any Agent to any Lender.  Each Lender represents to the Agents that it has, independently and without reliance upon any Agent or any other Lender, and based on such documents and information as it has deemed appropriate, made its own appraisal of and investigation into the business, operations, property, financial and other condition and creditworthiness of the Borrower and its affiliates and made its own decision to make its Loans hereunder and enter into this Agreement.  Each Lender also represents that it will, independently and without reliance upon any Agent or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit analysis, appraisals and decisions in taking or not taking action under this Agreement and the other Loan Documents, and to make such investigation as it deems necessary to inform itself as to the business, operations, property, financial and other condition and creditworthiness of the Borrower and its affiliates.  Except for notices, reports and other documents expressly required to be furnished to the Lenders by the Administrative Agent hereunder, no Agent shall have any duty or responsibility to provide any Lender with any credit or other information concerning the business, operations, property, condition (financial or otherwise), prospects or creditworthiness of the Borrower or any affiliate of the Borrower that may come into the possession of such Agent or any of its officers, directors, employees, agents, attorneys-in-fact or affiliates.

9.7           Indemnification.  The Lenders agree to indemnify each Agent in its capacity as such (to the extent not reimbursed by the Borrower and without limiting the obligation of the Borrower to do so), ratably according to their respective Aggregate Exposure Percentages in effect on the date on which indemnification is sought under this Section (or, if indemnification is sought after the date upon which the Commitments shall have terminated and the Loans shall have been paid in full, ratably in accordance with such Aggregate Exposure Percentages immediately prior to such date), for, and to save each Agent harmless from and against, any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind whatsoever that may at any time (including, without limitation, at any time following the payment of the Loans) be imposed on, incurred by or asserted against such Agent in any way relating to or arising out of, the Commitments, this Agreement, any of the other Loan Documents or any documents contemplated by or referred to herein or therein or the transactions contemplated hereby or thereby or any action taken or omitted by such Agent under or in connection with any of the foregoing; provided that no Lender shall be liable for the payment of any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements that are found by a final and nonappealable decision of a court of competent jurisdiction to have resulted from such Agent’s gross negligence or willful misconduct.  The agreements in this Section shall survive the payment of the Loans and all other amounts payable hereunder.

9.8           Agent in Its Individual Capacity.  Each Agent and its affiliates may make loans to, accept deposits from and generally engage in any kind of business with the Borrower or any of its Subsidiaries as though such Agent were not an Agent.  With respect to its Loans made or renewed by it and with respect to any Letter of Credit issued or participated in by it, each Agent shall have the same rights and powers under this Agreement and the other Loan Documents as any Lender and may exercise the same as though it were not an Agent, and the terms “Lender” and “Lenders” shall include each Agent in its individual capacity.

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9.9           Successor Agents.

(a)           The Administrative Agent may resign as Administrative Agent upon 10 days’ notice to the Lenders and the Borrower.  If the Administrative Agent shall resign as Administrative Agent under this Agreement and the other Loan Documents, then the Required Lenders shall appoint from among the Lenders a successor agent for the Lenders, which successor agent shall (unless an Event of Default under Section 8(a) or Section 8(f) with respect to the Borrower shall have occurred and be continuing) be subject to approval by the Borrower (which approval shall not be unreasonably withheld or delayed), whereupon such successor agent shall succeed to the rights, powers and duties of the Administrative Agent, and the term “Administrative Agent” shall mean such successor agent effective upon such appointment and approval, and the former Administrative Agent’s rights, powers and duties as Administrative Agent shall be terminated, without any other or further act or deed on the part of such former Administrative Agent or any of the parties to this Agreement or any holders of the Loans.  If no successor agent has accepted appointment as Administrative Agent by the date that is 10 days following a retiring Administrative Agent’s notice of resignation, the retiring Administrative Agent’s resignation shall nevertheless thereupon become effective, and the Lenders shall assume and perform all of the duties of the Administrative Agent hereunder until such time, if any, as the Required Lenders appoint a successor agent as provided for above.

(b)           The Syndication Agent may, at any time, by notice to the Lenders and the Administrative Agent, resign as Syndication Agent hereunder, whereupon the duties, rights, obligations and responsibilities of the Syndication Agent hereunder shall automatically be assumed by, and inure to the benefit of, the Administrative Agent, without any further act by the Syndication Agent, the Administrative Agent or any Lender.

(c)           The Collateral Agent may resign as Collateral Agent upon 10 days’ notice to the Lenders and the Borrower.  If the Collateral Agent shall resign as Collateral Agent under this Agreement and the other Loan Documents, then the Required Lenders shall appoint from among the Lenders a successor agent for the Lenders, which successor agent shall (unless an Event of Default under Section 8(a) or Section 8(f) with respect to the Borrower shall have occurred and be continuing) be subject to approval by the Borrower (which approval shall not be unreasonably withheld or delayed).  Upon any such appointment of a successor Collateral Agent and the transfer to such successor Collateral Agent of First Mortgage Bonds, together with any instruments reasonably requested by the Administrative Agent or the Lenders to confer or confirm the successor Collateral Agent’s rights in the First Mortgage Bonds, such successor agent shall succeed to the rights, powers and duties of the Collateral Agent, and the term “Collateral Agent” shall mean such successor agent effective upon such appointment and approval, and the former Collateral Agent’s rights, powers and duties as Collateral Agent shall be terminated, without any other or further act or deed on the part of such former Collateral Agent or any of the parties to this Agreement or any holders of the Loans.  If no successor agent has accepted appointment as Collateral Agent by the date that is 10 days following a retiring Collateral Agent’s notice of resignation, the retiring Collateral Agent’s resignation shall nevertheless thereupon become effective, and the Lenders shall assume and perform all of the duties of the Collateral Agent hereunder until such time, if any, as the Required Lenders appoint a successor agent as provided for above.

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(d)           After any retiring Agent’s resignation as Agent, the provisions of this Section 9 shall inure to its benefit as to any actions taken or omitted to be taken by it while it was Agent under this Agreement and the other Loan Documents.

9.10         The Arrangers; the Syndication Agent; the Co-Documentation Agents.  Neither the Arrangers, the Syndication Agent nor the Co-Documentation Agents, in their respective capacities as such, shall have any duties or responsibilities, and shall incur no liability, under this Agreement and the other Loan Documents.

SECTION 10.  MISCELLANEOUS

10.1         Amendments and Waivers.  Neither this Agreement or any other Loan Document, nor any terms hereof or thereof may be amended, supplemented or modified except in accordance with the provisions of this Section 10.1.  The Required Lenders and the Borrower may, or (with the written consent of the Required Lenders) the Administrative Agent (or the Collateral Agent, as applicable) and the Borrower may, from time to time, (a) enter into written amendments, supplements or modifications hereto and to the other Loan Documents (including amendments and restatements hereof or thereof) for the purpose of adding any provisions to this Agreement or the other Loan Documents or changing in any manner the rights of the Lenders or of the Borrower hereunder or thereunder or (b) waive, on such terms and conditions as may be specified in the instrument of waiver, any of the requirements of this Agreement or the other Loan Documents or any Default or Event of Default and its consequences; provided, however, that no such waiver and no such amendment, supplement or modification shall, without the consent of the requisite Lenders specified below:

(i)            forgive the principal amount or extend the final scheduled date of maturity of any Loan or Reimbursement Obligation, extend the scheduled date of any amortization payment in respect of any Term Loan, reduce the stated rate of any interest or fee payable under this Agreement (except (x) in connection with the waiver of applicability of any post-default increase in interest rates (which waiver shall be effective with the consent of the Majority Facility Lenders of each adversely affected Facility) and (y) that any amendment or modification of defined terms used in the financial covenants in this Agreement shall not constitute a reduction in the rate of interest or fees for purposes of this clause (i)) or extend the scheduled date of any payment thereof, or increase the amount or extend the expiration date of any Commitment of any Lender, in each case without the consent of each Lender directly affected thereby;

(ii)           amend, modify or waive any provision of this Section or reduce any percentage specified in the definition of Required Lenders or Required Prepayment Lenders, consent to the assignment or transfer by the Borrower of any of its rights and obligations under this Agreement and the other Loan Documents, release all or substantially all of the Collateral, in each case without the consent of all the Lenders;

(iii)          amend, modify or waive any condition precedent to any extension of credit under the Revolving Credit Facility set forth in Section 5.3 (including,

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without limitation, the waiver of an existing Default or Event of Default required to be waived in order for such extension of credit to be made) without the consent of the Majority Revolving Credit Facility Lenders;

(iv)          reduce the percentage specified in the definition of Majority Facility Lenders with respect to any Facility without the consent of all of the Lenders under such Facility;

(v)           amend, modify or waive any provision of Section 9, or any other provision affecting the rights, duties or obligations of any Agent, without the consent of any Agent directly affected thereby;

(vi)          amend, modify or waive any provision of Section 2.6 or 2.7 without the consent of the Swing Line Lender or alter its rights or obligations with respect to the Swing Line Loans;

(vii)         amend, modify or waive any provision of Section 2.12 without the consent of the Required Prepayment Lenders;

(viii)        amend, modify or waive any provision of Section 2.18 or 10.8 without the consent of each Lender directly affected thereby;

(ix)           amend, modify or waive any provision of Section 3 without the consent of each Issuing Lender affected thereby; or

(x)            impose restrictions on assignments and participations that are more restrictive than, or additional to, those set forth in Section 10.7 without the consent of all the Lenders.

Notwithstanding the foregoing, any reduction in the Applicable Margin with respect to any Facility shall require the consent of all of the Lenders under such Facility and shall not require the consent or approval of any other Lender.

Any such waiver and any such amendment, supplement or modification shall apply equally to each of the Lenders and shall be binding upon the Borrower, the Lenders, the Agents and all future holders of the Loans.  In the case of any waiver, the Borrower, the Lenders and the Agents shall be restored to their former position and rights hereunder and under the other Loan Documents, and any Default or Event of Default waived shall be deemed to be cured and not continuing; but no such waiver shall extend to any subsequent or other Default or Event of Default, or impair any right consequent thereon.  Any such waiver, amendment, supplement or modification shall be effected by a written instrument signed by the parties required to sign pursuant to the foregoing provisions of this Section; provided, that delivery of an executed signature page of any such instrument by facsimile or email transmission shall be effective as delivery of a manually executed counterpart thereof.

For the avoidance of doubt, this Agreement and any other Loan Document may be amended (or amended and restated) with the written consent of the Required Lenders, the Administrative Agent and the Borrower (x) to add one or more additional credit facilities to this

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Agreement and to permit the extensions of credit from time to time outstanding thereunder and the accrued interest and fees in respect thereof (collectively, the “Additional Extensions of Credit”) to share ratably in the benefits of this Agreement and the other Loan Documents with the Term Loans and Revolving Extensions of Credit and the accrued interest and fees in respect thereof and (y) to include appropriately the Lenders holding such credit facilities in any determination of the Required Lenders, Required Prepayment Lenders and Majority Revolving Facility Lenders; provided, however, that no such amendment shall permit the Additional Extensions of Credit to share ratably with or with preference to the Loans in the application of mandatory prepayments without the consent of the Required Prepayment Lenders.

10.2         First Mortgage Bonds.  The parties hereto acknowledge and agree that (i) the Collateral Agent and the Administrative Agent are hereby authorized by the Lenders to give to the trustees under the Indentures notices (and other information) and to take such other actions as are required by, or specified in, the Supplemental Indentures (as in effect on the date hereof or as may be amended from time to time with the consent of the Administrative Agent and the Collateral Agent) and/or the Bond Delivery Agreement to be given or taken by them (and the Collateral Agent and the Administrative Agent agree to comply with such terms) and (ii) the Collateral Agent shall have such rights under and in respect of the First Mortgage Bonds and the Indentures as are provided or referred to in the Bond Delivery Agreement (including voting rights referred to in Sections 4.1 and 6.1 thereof).  Payments actually received by the Collateral Agent with respect to any First Mortgage Bonds shall be turned over to the Administrative Agent and shall be distributed by the Administrative Agent, in accordance with the terms hereof, as follows, (i) in the case of any payment actually received under the Revolving Credit First Mortgage Bonds, to the Revolving Credit Lenders (and, in the case of amounts constituting cash collateral for outstanding Letters of Credit, to the Administrative Agent) pro rata in payment of the Obligations constituting the basis upon which such payment was calculated and made and (ii) in the case of any payment actually received under the Term Loan First Mortgage Bonds, to the Term Loan Lenders pro rata in payment of the Obligations constituting the basis upon which such payment was calculated and made.  Notwithstanding the foregoing, in the event that any costs, expenses or losses of the Administrative Agent or the Collateral Agent in connection with the Loan Documents or their respective administration or enforcement (or any other amount for which demand for indemnification may be made pursuant to Section 9.7) are then outstanding (and without in any way adversely affecting the Borrower’s obligations pursuant to Section 10.6 or otherwise), the Administrative Agent (on behalf of itself or the Collateral Agent) shall have the right in its sole discretion to deduct from such proceeds for such outstanding amounts to the extent permitted and in accordance with Section 9.7.

10.3         Notices.  All notices, requests and demands to or upon the respective parties hereto to be effective shall be in writing (including by telecopy), and, unless otherwise expressly provided herein, shall be deemed to have been duly given or made when delivered, or three Business Days after being deposited in the mail, postage prepaid, or, in the case of telecopy notice, when received, addressed (a) in the case of the Borrower and the Agents, as follows and (b) in the case of the Lenders, as set forth in an administrative questionnaire delivered to the Administrative Agent or on Schedule I to the Lender Addendum to which such Lender is a party or, in the case of a Lender which becomes a party to this Agreement pursuant to an Assignment and Acceptance, in such Assignment and Acceptance or (c) in the case of any party, to such other address as such party may hereafter notify to the other parties hereto:

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The Borrower:	Northwestern Corporation 125 S. Dakota Avenue,. Suite 1100 Sioux Falls, South Dakota 57104 Attention: Brian Bird                  Chief Financial Officer Telecopy: (605) 978-2909 Telephone: (605) 978-2910
with a copy to:	Northwestern Corporation 125 S. Dakota Avenue, Suite 1100 Sioux Falls, South Dakota 57104 Attention: General Counsel Telecopy: (605) 978-2908 Telephone: (605) 978-2845
and	Paul, Hastings, Janofsky & Walker, LLP 600 Peachtree Street, N.E., Suite 2400 Atlanta, Georgia 30308 Attention: Jesse H. Austin, III                   Kevin Conboy Telecopy: (404) 815-2424 Telephone: (404) 815-2400
The Syndication Agent:	Deutsche Bank Securities Inc. 60 Wall Street, NYC 60-4301 New York, New York 10005 Attention: Marcus Tarkington Telecopy: (212)797-5694 Telephone: (212)250-6143
The Administrative Agent:	Lehman Commercial Paper Inc. 745 Seventh Avenue New York, New York 10019 Attention: Brian McNany Telecopy: (212) 526-6643 Telephone: (212) 526-6590
The Collateral Agent:	Lehman Commercial Paper Inc. 745 Seventh Avenue New York, New York 10019 Attention: Craig J. Malloy Telecopy: (646) 758-4617 Telephone: (212) 526-7150

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With a copy to:	Dewey Ballantine LLP 1301 Avenue of the Americas New York, New York 10019 Attention: Gregory Owens, Esq. Telecopy: (212) 259-6333 Telephone: (212) 259-6823
Issuing Lender:	As notified by such Issuing Lender to the Administrative Agent and the Borrower
Swing Line Lender:	Lehman Commercial Paper Inc. 745 Seventh Avenue New York, New York 10019 Attention: Brian McNany Telecopy: (212) 526-6643 Telephone: (212) 526-6590

provided that any notice, request or demand to or upon the any Agent, any Issuing Lender or any Lender shall not be effective until received.

Notices and other communications to the Lenders hereunder may be delivered or furnished by electronic communications pursuant to procedures approved by the Administrative Agent; provided that the foregoing shall not apply to notices pursuant to Section 2 unless otherwise agreed by the Administrative Agent and the applicable Lender.  The Administrative Agent or the Borrower may, in its reasonable discretion, agree to accept notices and other communications to it hereunder by electronic communications pursuant to procedures approved by it; provided that approval of such procedures may be limited to particular notices or communications.

10.4         No Waiver; Cumulative Remedies.  No failure to exercise and no delay in exercising, on the part of any Agent or any Lender, any right, remedy, power or privilege hereunder or under the other Loan Documents shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege.  The rights, remedies, powers and privileges herein provided are cumulative and not exclusive of any rights, remedies, powers and privileges provided by law.

10.5         Survival of Representations and Warranties.  All representations and warranties made herein, in the other Loan Documents and in any document, certificate or statement delivered pursuant hereto or in connection herewith shall survive the execution and delivery of this Agreement and the making of the Loans and other extensions of credit hereunder.

10.6         Payment of Expenses.  The Borrower agrees (a) to pay or reimburse the Agents for all their reasonable out-of-pocket costs and expenses incurred in connection with the syndication of the Facilities (other than fees payable to syndicate members) and the development, preparation and execution of, and any amendment, supplement or modification to, this Agreement and the other Loan Documents and any other documents prepared in connection

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herewith or therewith, and the consummation and administration of the transactions contemplated hereby and thereby, including, without limitation, the reasonable fees and disbursements and other charges of counsel to the Administrative Agent and the charges of Intralinks, (b) to pay or reimburse the Agents and any Issuing Lender and, if incurred during the continuance of an Event of Default, each Lender for all their costs and expenses incurred in connection with the enforcement or preservation of any rights under this Agreement, the other Loan Documents and any other documents prepared in connection herewith or therewith, including, without limitation, the fees and disbursements of counsel (including the allocated fees and disbursements and other charges of in-house counsel) to each Lender, each Issuing Lender and of counsel to the Agents, (c) to pay, indemnify, or reimburse each Lender, each Issuing Lender and the Agents for, and hold each Lender, each Issuing Lender and the Agents harmless from, any and all recording and filing fees and any and all liabilities with respect to, or resulting from any delay in paying, stamp, excise and other taxes, if any, which may be payable or determined to be payable in connection with the execution and delivery of, or consummation or administration of any of the transactions contemplated by, or any amendment, supplement or modification of, or any waiver or consent under or in respect of, this Agreement, the other Loan Documents and any such other documents, and (d) to pay, indemnify or reimburse each Lender, each Issuing Lender, each Agent, their respective affiliates, and their respective officers, directors, trustees, employees, advisors, agents and controlling persons (each, an “Indemnitee”) for, and hold each Indemnitee harmless from and against any and all other liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever incurred by an Indemnitee or asserted against any Indemnitee by any third party or by the Borrower arising out of, in connection with, or as a result of (i) the execution or delivery of this Agreement, any other Loan Document or any agreement or instrument contemplated hereby or thereby, the performance by the parties hereto or thereto of their respective obligations hereunder or thereunder or the consummation of the transactions contemplated hereby or thereby, (ii) any Loan or Letter of Credit or the use or proposed use of the proceeds therefrom (including any refusal by any Issuing Bank to honor a demand for payment under a Letter of Credit if the documents presented in connection with such demand do not strictly comply with the terms of such Letter of Credit), (iii) any actual or alleged presence or release of Materials of Environmental Concern on or from any property owned, occupied or operated by the Borrower or any of its Subsidiaries, or any Environmental Liability related in any way to the Borrower or any of its Subsidiaries or any or their respective properties, or (iv) any actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort or any other theory, whether brought by any third party or by the Borrower, and regardless of whether any Indemnitee is a party thereto (all the foregoing in this clause (d), collectively, the “Indemnified Liabilities”), provided, that the Borrower shall have no obligation hereunder to any Indemnitee with respect to Indemnified Liabilities to the extent such Indemnified Liabilities are found by a final and nonappealable decision of a court of competent jurisdiction to have resulted from the gross negligence or willful misconduct of such Indemnitee.  No Indemnitee shall be liable for any damages arising from the use by unauthorized persons of information, data, reports or other materials sent through electronic, telecommunications or other information transmission systems that are intercepted by such persons (unless it is finally judicially determined that such interception was directly a result of the gross negligence or willful misconduct of such Indemnitee) or for any special, indirect, consequential or punitive damages in connection with the Facilities.  Without limiting the

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foregoing, and to the extent permitted by applicable law, the Borrower agrees not to assert and to cause its Subsidiaries and the Excluded Subsidiaries not to assert, and hereby waives and agrees to cause its Subsidiaries so to waive, all rights for contribution or any other rights of recovery with respect to all claims, demands, penalties, fines, liabilities, settlements, damages, costs and expenses of whatever kind or nature, under or related to Environmental Laws, that any of them might have by statute or otherwise against any Indemnitee.  All amounts due under this Section shall be payable not later than 30 days after written demand therefor.  Statements payable by the Borrower pursuant to this Section shall be submitted to Brian Bird (Telephone No.(605) 978-2909) (Fax No. (605) 978-2910), at the address of the Borrower set forth in Section 10.3, or to such other Person or address as may be hereafter designated by the Borrower in a notice to the Administrative Agent.  The agreements in this Section shall survive repayment of the Loans and all other amounts payable hereunder.

10.7         Successors and Assigns; Participations and Assignments.  (a)  This Agreement shall be binding upon and inure to the benefit of the Borrower, the Lenders, the Agents, all future holders of the Loans and their respective successors and assigns, except that the Borrower may not assign or transfer any of its rights or obligations under this Agreement without the prior written consent of the Agents and each Lender.

(b)           Any Lender may, in the ordinary course of its business, without the consent of the Borrower, in accordance with applicable law, at any time sell to one or more banks, financial institutions or other entities (each, a “Participant”) participating interests in any Loan owing to such Lender, any Commitment of such Lender or any other interest of such Lender hereunder and under the other Loan Documents.  In the event of any such sale by a Lender of a participating interest to a Participant, such Lender’s obligations under this Agreement to the other parties to this Agreement shall remain unchanged, such Lender shall remain solely responsible for the performance thereof, such Lender shall remain the holder of any such Loan for all purposes under this Agreement and the other Loan Documents, and the Borrower and the Agents shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement and the other Loan Documents.  In no event shall any Participant under any such participation have any right to approve any amendment or waiver of any provision of any Loan Document, or any consent to any departure by the Borrower therefrom, except to the extent that such amendment, waiver or consent would require the consent of all Lenders pursuant to Section 10.1.  The Borrower agrees that if amounts outstanding under this Agreement and the Loans are due or unpaid, or shall have been declared or shall have become due and payable upon the occurrence of an Event of Default, each Participant shall, to the maximum extent permitted by applicable law, be deemed to have the right of setoff in respect of its participating interest in amounts owing under this Agreement to the same extent as if the amount of its participating interest were owing directly to it as a Lender under this Agreement, provided that, in purchasing such participating interest, such Participant shall be deemed to have agreed to share with the Lenders the proceeds thereof as provided in Section 10.8(a) as fully as if such Participant were a Lender hereunder.  The Borrower also agrees that each Participant shall be entitled to the benefits of Sections 2.19, 2.20 and 2.21 with respect to its participation in the Commitments and the Loans outstanding from time to time as if such Participant were a Lender; provided that, in the case of Section 2.20, such Participant shall have complied with the requirements of said Section, and provided, further, that no Participant shall be entitled to receive any greater amount pursuant to any such Section than

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the transferor Lender would have been entitled to receive in respect of the amount of the participation transferred by such transferor Lender to such Participant had no such transfer occurred.

(c)           Any Lender (an “Assignor”) may, in the ordinary course of its business, in accordance with applicable law and upon written notice to the Administrative Agent, at any time and from time to time assign to any Lender or any affiliate, Related Fund or, with the consent of the Borrower and the Administrative Agent and, in the case of any assignment of Revolving Credit Commitments, the written consent of the Issuing Lender and the Swing Line Lender (which, in each case, shall not be unreasonably withheld or delayed) (provided (x) that no consent from the applicable parties need be obtained by any Lehman Entity or by any Deutsche Bank Entity in their capacity as Assignors (other than, solely in the case of any assignment of Revolving Credit Commitments, the consent of the Issuing Lender and the Swing Line Lender (which, in each case, shall not be unreasonably withheld or delayed)) and (y) the consent of the Borrower need not be obtained with respect to any assignment of Term Loans), to an additional bank, financial institution or other entity (an “Assignee”) all or any part of its rights and obligations under this Agreement pursuant to an Assignment and Acceptance, substantially in the form of Exhibit E, executed by such Assignee and such Assignor (and, where the consent of the Borrower, the Administrative Agent , the Issuing Lender or the Swing Line Lender is required pursuant to the foregoing provisions, by the Borrower and such other Persons) and delivered to the Administrative Agent for its acceptance and recording in the Register; provided that (A) with respect to assignments of Revolving Credit Commitments, no such assignment to an Assignee (other than any Lender or any Affiliate or Related Fund thereof) shall be in an aggregate principal amount of less than $5,000,000 (other than in the case of an assignment of all of a Lender’s interests under this Agreement) and, after giving effect thereto, such Assignor shall have Revolving Credit Commitments and Revolving Credit Loans aggregating at least $5,000,000 (if holding any) and (B) with respect to assignments of Term Loans, no such assignment to an Assignee (other than any Lender or any Affiliate or Related Fund thereof) shall be in an aggregate principal amount of less than $1,000,000 (other than in the case of an assignment of all of a Lender’s interest under this Agreement) and, after giving effect thereto, such Assignor shall have Term Loans aggregating at least $1,000,000 (if such Assignor then holds any Term Loan), in each case unless otherwise agreed by the Borrower and the Administrative Agent.  Any such assignment need not be ratable as among the Facilities.  Upon such execution, delivery, acceptance and recording, from and after the effective date determined pursuant to such Assignment and Acceptance, (x) the Assignee thereunder shall be a party hereto and, to the extent provided in such Assignment and Acceptance, have the rights and obligations of a Lender hereunder with Commitments and/or Loans as set forth therein, and (y) the Assignor thereunder shall, to the extent provided in such Assignment and Acceptance, be released from its obligations under this Agreement (and, in the case of an Assignment and Acceptance covering all of an Assignor’s rights and obligations under this Agreement, such Assignor shall cease to be a party hereto, except as to Section 2.19, 2.20 and 10.6 in respect of the period prior to such effective date).  Notwithstanding any provision of this Section, the consent of the Borrower shall not be required for any assignment that occurs at any time when any Event of Default shall have occurred and be continuing.  For purposes of the minimum assignment amounts and minimum hold amounts set forth in this paragraph, multiple assignments to or by two or more Related Funds shall be aggregated.

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(d)           The Administrative Agent shall, on behalf of the Borrower, maintain at its address referred to in Section 10.3 a copy of each Assignment and Acceptance delivered to it and a register (the “Register”) for the recordation of the names and addresses of the Lenders and the Commitment of, and principal amount of the Loans owing to, each Lender from time to time.  The entries in the Register shall be conclusive, in the absence of manifest error, and the Borrower, each Agent and the Lenders shall treat each Person whose name is recorded in the Register as the owner of the Loans and any Notes evidencing such Loans recorded therein for all purposes of this Agreement.  Any assignment of any Loan, whether or not evidenced by a Note, shall be effective only upon appropriate entries with respect thereto being made in the Register (and each Note shall expressly so provide).  Any assignment or transfer of all or part of a Loan evidenced by a Note shall be registered on the Register only upon surrender for registration of assignment or transfer of the Note evidencing such Loan, accompanied by a duly executed Assignment and Acceptance; thereupon one or more new Notes in the same aggregate principal amount shall be issued to the designated Assignee, and the old Notes shall be returned by the Administrative Agent to the Borrower marked “canceled”.  The Register shall be available for inspection by the Borrower or any Lender (with respect to any entry relating to such Lender’s Loans) at any reasonable time and from time to time upon reasonable prior notice.

(e)           Upon its receipt of an Assignment and Acceptance executed by an Assignor and an Assignee (and, in any case where the consent of any other Person is required by Section 10.7(c), by each such other Person) together with payment by the applicable Assignor or Assignee to the Administrative Agent of a registration and processing fee of $3,500 (treating multiple, simultaneous assignments by or to two or more Related Funds as a single assignment) (except that no such registration and processing fee shall be payable (y) in connection with an assignment by or to a Lehman Entity or a Deutsche Bank Entity or (z) in the case of an Assignee which is already a Lender or is an affiliate or Related Fund of a Lender or a Person under common management with a Lender), the Administrative Agent shall (i) promptly accept such Assignment and Acceptance and (ii) on the effective date determined pursuant thereto record the information contained therein in the Register and give notice of such acceptance and recordation to the Borrower.  The Borrower, at its own expense, promptly upon receipt of a request by the Administrative Agent, shall execute and deliver to the Administrative Agent (in exchange for the Revolving Credit Note and/or applicable Term Notes, as the case may be, of the assigning Lender) a new Revolving Credit Note and/or applicable Term Notes, as the case may be, to the order of such Assignee in an amount equal to the Revolving Credit Commitment and/or applicable Term Loans, as the case may be, assumed or acquired by it pursuant to such Assignment and Acceptance and, if the Assignor has retained a Revolving Credit Commitment and/or Term Loans, as the case may be, upon request, a new Revolving Credit Note and/or Term Notes, as the case may be, to the order of the Assignor in an amount equal to the Revolving Credit Commitment and/or applicable Term Loans, as the case may be, retained by it hereunder.  Such new Note or Notes shall be dated the effective date of the relevant assignment and shall otherwise be in the form of the Note or Notes replaced thereby.

(f)            For avoidance of doubt, the parties to this Agreement acknowledge that the provisions of this Section concerning assignments of Loans and Notes relate only to absolute assignments and that such provisions do not prohibit assignments creating security interests in Loans and Notes, including, without limitation, any pledge or assignment by a Lender of any Loan or Note to any Federal Reserve Bank in accordance with applicable law.

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(g)           Notwithstanding anything to the contrary contained herein, any Lender (a “Granting Lender”) may grant to a special purpose funding vehicle (an “SPC”), identified as such in writing from time to time by the Granting Lender to the Administrative Agent and the Borrower, the option to provide to the Borrower all or any part of any Loan that such Granting Lender would otherwise be obligated to make to the Borrower pursuant to this Agreement; provided that (i) nothing herein shall constitute a commitment by any SPC to make any Loan and (ii) if an SPC elects not to exercise such option or otherwise fails to provide all or any part of such Loan, the Granting Lender shall be obligated to make such Loan pursuant to the terms hereof.  The making of a Loan by an SPC hereunder shall utilize the Commitment of the Granting Lender to the same extent, and as if, such Loan were made by such Granting Lender.  Each party hereto hereby agrees that no SPC shall be liable for any indemnity or similar payment obligation under this Agreement (all liability for which shall remain with the Granting Lender).  In furtherance of the foregoing, each party hereto hereby agrees (which agreement shall survive the termination of this Agreement) that, prior to the date that is one year and one day after the payment in full of all outstanding commercial paper or other indebtedness of any SPC, it will not institute against, or join any other person in instituting against, such SPC any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings under the laws of the United States or any state thereof.  In addition, notwithstanding anything to the contrary in this Section 10.7(g), any SPC may (A) with notice to, but without the prior written consent of, the Borrower and the Administrative Agent and without paying any processing fee therefor, assign all or a portion of its interests in any Loans to the Granting Lender, or with the prior written consent of the Borrower and the Administrative Agent (which consent shall not be unreasonably withheld) to any financial institutions providing liquidity and/or credit support to or for the account of such SPC to support the funding or maintenance of Loans, and (B) disclose on a confidential basis any non-public information relating to its Loans to any rating agency, commercial paper dealer or provider of any surety, guarantee or credit or liquidity enhancement to such SPC; provided that non-public information with respect to the Borrower may be disclosed only with the Borrower’s consent which will not be unreasonably withheld.  This paragraph (g) may not be amended without the written consent of any SPC with Loans outstanding at the time of such proposed amendment.

10.8         Adjustments; Set-off.  (a)  Except to the extent that this Agreement provides for payments to be allocated to a particular Lender or to the Lenders under a particular Facility, if any Lender (a “Benefitted Lender”) shall at any time receive any payment of all or part of the Obligations owing to it, or receive any collateral in respect thereof (whether voluntarily or involuntarily, by set-off, pursuant to events or proceedings of the nature referred to in Section 8(f), or otherwise), in a greater proportion than any such payment to or collateral received by any other Lender, if any, in respect of such other Lender’s Obligations, such Benefitted Lender shall purchase for cash from the other Lenders a participating interest in such portion of each such other Lender’s Obligations, or shall provide such other Lenders with the benefits of any such collateral, as shall be necessary to cause such Benefitted Lender to share the excess payment or benefits of such collateral ratably with each of the Lenders; provided, however, that if all or any portion of such excess payment or benefits is thereafter recovered from such Benefitted Lender, such purchase shall be rescinded, and the purchase price and benefits returned, to the extent of such recovery, but without interest.

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(b)           Upon the occurrence and during the continuance of an Event of Default, in addition to any rights and remedies of the Lenders provided by law, each Lender, including without limitation each Issuing Lender, shall have the right, without prior notice to the Borrower, any such notice being expressly waived by the Borrower to the extent permitted by applicable law, upon any amount becoming due and payable by the Borrower hereunder (whether at the stated maturity, by acceleration or otherwise), to set off and appropriate and apply against such amount any and all deposits (general or special, time or demand, provisional or final), in any currency, and any other credits, indebtedness or claims, in any currency, in each case whether direct or indirect, absolute or contingent, matured or unmatured, at any time held or owing by such Lender or any branch or agency thereof to or for the credit or the account of  the Borrower.  Each Lender agrees promptly to notify the Borrower and the Administrative Agent after any such setoff and application made by such Lender, provided that the failure to give such notice shall not affect the validity of such setoff and application.

10.9         Counterparts.  This Agreement may be executed by one or more of the parties to this Agreement on any number of separate counterparts, and all of said counterparts taken together shall be deemed to constitute one and the same instrument.  Delivery of an executed signature page of this Agreement or of a Lender Addendum by facsimile or email transmission shall be effective as delivery of a manually executed counterpart hereof.  A set of the copies of this Agreement signed by all the parties shall be lodged with the Borrower and the Administrative Agent.

10.10       Severability.  Any provision of this Agreement that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

10.11       Integration.  This Agreement and the other Loan Documents represent the entire agreement of the Borrower, the Agents, the Arrangers and the Lenders with respect to the subject matter hereof and thereof, and there are no promises, undertakings, representations or warranties by any Arranger, any Agent or any Lender relative to subject matter hereof not expressly set forth or referred to herein or in the other Loan Documents.

10.12       GOVERNING LAW.  THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK WITHOUT REGARD TO THE PRINCIPLES OF CONFLICT OF LAWS THEREOF OTHER THAN SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK.

10.13       Submission To Jurisdiction; Waivers.  The Borrower hereby irrevocably and unconditionally:

(a)           submits for itself and its Property in any legal action or proceeding relating to this Agreement and the other Loan Documents to which it is a party, or for recognition and enforcement of any judgment in respect thereof, to the non-exclusive

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general jurisdiction of the courts of the State of New York, the courts of the United States of America for the Southern District of New York, and appellate courts from any thereof;

(b)           consents that any such action or proceeding may be brought in such courts and waives any objection that it may now or hereafter have to the venue of any such action or proceeding in any such court or that such action or proceeding was brought in an inconvenient court and agrees not to plead or claim the same;

(c)           agrees that service of process in any such action or proceeding may be effected by mailing a copy thereof by registered or certified mail (or any substantially similar form of mail), postage prepaid, to  the Borrower at its address set forth in Section 10.3 or at such other address of which the Administrative Agent shall have been notified pursuant thereto;

(d)           agrees that nothing herein shall affect the right to effect service of process in any other manner permitted by law or shall limit the right to sue in any other jurisdiction; and

(e)           waives, to the maximum extent not prohibited by law, any right it may have to claim or recover in any legal action or proceeding referred to in this Section any special, exemplary, punitive or consequential damages.

10.14       Acknowledgments.  The Borrower hereby acknowledges that:

(a)           it has been advised by counsel in the negotiation, execution and delivery of this Agreement and the other Loan Documents;

(b)           no Arranger, Agent nor any Lender has any fiduciary relationship with or duty to the Borrower arising out of or in connection with this Agreement or any of the other Loan Documents, and the relationship between the Arrangers, the Agents and the Lenders, on one hand, and the Borrower, on the other hand, in connection herewith or therewith is solely that of debtor and creditor; and

(c)           no joint venture is created hereby or by the other Loan Documents or otherwise exists by virtue of the transactions contemplated hereby among the Arrangers, the Agents and the Lenders or among  the Borrower and the Lenders.

10.15       Confidentiality.  Each of the Agents and the Lenders agrees to keep confidential all non-public information provided or made available to it by, or on behalf of, the Borrower in connection with this Agreement and the transactions contemplated hereby; provided that nothing herein shall prevent any Agent or any Lender from disclosing any such information (a) to any Arranger, any Agent, any other Lender or any affiliate of any thereof, (b) to any Participant or Assignee (each, a “Transferee”) or prospective Transferee that agrees to comply with the provisions of this Section or substantially equivalent provisions, (c) to any of its employees, directors, agents, attorneys, accountants and other professional advisors, (d) upon the request or demand of any Governmental Authority or self regulatory organization having jurisdiction over it, (e) in response to any order of any court or other Governmental Authority or self regulatory organization or as may otherwise be required pursuant to any Requirement of

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Law, (f) in connection with any litigation or similar proceeding relating to any Obligation, this Agreement, any other Loan Document, the Indentures, or any transaction contemplated hereby or thereby, (g) that has been publicly disclosed other than in breach of this Section, (h) to the National Association of Insurance Commissioners or any similar organization or any nationally recognized rating agency that requires access to information about a Lender’s investment portfolio in connection with ratings issued with respect to such Lender or (i) in connection with the exercise of any remedy hereunder or under any other Loan Document. Notwithstanding anything to the contrary in the foregoing sentence or any other express or implied agreement, arrangement or understanding, the parties hereto hereby agree that, from the commencement of discussions with respect to the financing provided hereunder, any party hereto (and each of its employees, representatives, or agents) is permitted to disclose to any and all persons, without limitation of any kind, the tax structure and tax aspects of the transactions contemplated hereby, and all materials of any kind (including opinions or other tax analyses) related to such tax structure and tax aspects.

10.16       Accounting Changes.  In the event that any “Accounting Change” (as defined below) shall occur and such change results in a change in the method of calculation of financial covenants, standards or terms in this Agreement, then the Borrower and the Administrative Agent agree to enter into good faith negotiations in order to amend such provisions of this Agreement so as to equitably reflect such Accounting Change with the desired result that the criteria for evaluating the Borrower’s financial condition shall be the same after such Accounting Change as if such Accounting Change had not been made.  Until such time as such an amendment shall have been executed and delivered by the Borrower, the Administrative Agent and the Required Lenders, all financial covenants, standards and terms in this Agreement shall continue to be calculated or construed as if such Accounting Change had not occurred.  “Accounting Change” refers to any change in accounting principles required by the promulgation of any rule, regulation, pronouncement or opinion by the Financial Accounting Standards Board of the American Institute of Certified Public Accountants or, if applicable, the SEC.

10.17       Delivery of Lender Addenda.  Each initial Lender shall become a party to this Agreement by delivering to the Administrative Agent a Lender Addendum duly executed by such Lender, the Borrower and the Administrative Agent.

10.18      WAIVERS OF JURY TRIAL.  TO THE EXTENT PERMITTED UNDER APPLICABLE LAW, THE BORROWER, THE AGENTS AND THE LENDERS HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.

93

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

			NORTHWESTERN CORPORATION,
			as Borrower
			By:	/s/ Paul J. Evans
				Name:	Paul J. Evans
				Title:	Treasurer
			LEHMAN BROTHERS INC.,
			as Arranger
			By:	/s/ Jeffrey Abt
				Name:	Jeffrey Abt
				Title:	SVP
			DEUTSCHE BANK SECURITIES INC.,
			as Arranger
By:	/s/ N. Jansa		By:	/s/ Terence Neafsey
	Name:	N. Jansa		Name:	Terence Neafsey
	Title:	Director		Title:
			UNION BANK OF CALIFORNIA, N.A.
			as Co-Documentation Agent
			By:	/s/ Robert J. Cole
				Name:	Robert J. Cole
				Title:	Vice President
			KEYBANK NATIONAL ASSOCIATION
			as Co-Documentation Agent
			By:	/s/ Keven R. Smith
				Name:	Keven R. Smith
				Title:	Vice President

LEHMAN COMMERCIAL PAPER INC.,
as Administrative Agent
By:	/s/ Jeffrey Abt
	Name:	Jeffrey Abt
	Title:	SVP
LEHMAN COMMERCIAL PAPER INC.,
as Collateral Agent
By:	/s/ Jeffrey Abt
	Name:		Jeffrey Abt
	Title:		SVP

DEUTSCHE BANK AG, CAYMAN ISLANDS BRANCH,
as an Initial Lender and as Issuing Lender
By:	/s/ Saad Igbal
	Name:	Saad Igbal
	Title:	Vice President
By:	/s/ Marcus M. Tarkington
	Name:	Marcus M. Tarkington
	Title:	Director

Annex A

The Commitment Fee Rate and the Applicable Margin for Revolving Credit Loans shall be, at any time, the rate per annum set forth in the table below opposite the Facilities rating Standard & Poor’s Ratings Services and Moody’s Investor Service Inc.

	Applicable Spread for:		Commitment Fee
Rating Levels	Eurodollar Loans	Base Rate Loans
> Baa3 and BBB-	100	0	20
Baa3 and BBB-	125	25	25
Ba1 and BB+	150	50	37.5
Ba2 and BB	175	75	50
< Ba2 and BB	175	75	50

For purposes hereof, columns titled “Eurodollar Loans” and “Base Rate Loans” will be referred to as “Drawn Cost” and the column titled “Commitment Fee” will be referred to as “Undrawn Cost.”

With respect to Undrawn Cost determination, in the event the Borrower secures a split rating, the applicable Undrawn Cost will be that corresponding to the higher rating.  If, however, the split rating is more than one level of difference, then the Undrawn Cost shall be the rating falling at the midpoint (or, if no midpoint, then the lower of the midpoint levels).

With respect to Drawn Cost determination, the following shall apply:

1.If both ratings qualify as investment grade, then the Drawn Cost shall be that corresponding to the higher rating.

2.If one rating is investment grade and the other rating is non-investment grade, then the Drawn Cost shall be that corresponding to the lower rating.

3.If both ratings do not qualify as investment grade, then the Drawn Cost shall be that corresponding to the lower rating.

4.If a split rating exists and either (i) one rating is investment grade and the other rating is non-investment grade, or (ii) both ratings do not qualify as investment grade and the split rating is more than one level of difference, then the Drawn Cost shall be the rating falling at the midpoint (or, if no midpoint, then the lower of the midpoint levels).

EX-99.2

Exhibit 99.2

	NorthWestern Corporation
	d/b/a NorthWestern Energy
	125 S. Dakota Ave.
	Sioux Falls, SD 57104
	www.northwesternenergy.com
News Release	NASDAQ: NWEC

FOR IMMEDIATE RELEASE

Media/Investor Relations Contact:

Roger Schrum

605-978-2848

roger.schrum@northwestern.com

NORTHWESTERN EMERGES FROM CHAPTER 11

Company Successfully Completes Financial Reorganization

New Common Stock to Begin Trading on NASDAQ

SIOUX FALLS, S.D. – Nov. 1, 2004 – NorthWestern Corporation, d/b/a NorthWestern Energy, announced that its confirmed plan of reorganization (the “Plan”) became effective today, and the Company has emerged from Chapter 11.  As previously announced, the U.S. Bankruptcy Court for the District of Delaware confirmed the Company’s Plan on October 8, 2004, and the Court’s order was entered on October 20, 2004.

Gary G. Drook, President and Chief Executive Officer of NorthWestern, said, “This is an important day for the “new” NorthWestern, as we have completed a highly successful restructuring in a very short timeframe without raising our customers’ utility rates. Today, we are beginning a new phase as a focused electric and natural gas utility with a solid capital structure, greatly reduced debt and improved operational efficiency.  We are excited now to turn our full attention to growing our utility business in a smart way and seeking new and innovative ways to continue to improve reliability and service to our customers.”

As a result of NorthWestern’s restructuring, the Company’s debt was reduced from $2.2 billion to approximately $850 million including the effect of refinancing.  The Company’s restructuring also resulted in the disposition of significant nonutility assets, a simplification in its corporate structure and a reduction in overhead costs.

NorthWestern will have approximately $710 million in book equity with 35.5 million common shares distributed to the Company’s creditors.  A total of 4,409,100 of these shares, or 13.5 percent, of the new common stock, is being held in reserve pending resolution of contingent or otherwise unliquidated claims.

New Common Stock Distribution

As previously announced, NorthWestern’s financial reorganization was achieved through a debt-for-equity swap.  Terms of the Plan, including distribution of the new common stock, include:

•Holders of the Company’s senior unsecured notes (Class 7 claims) received 28,250,900 shares of new common stock in exchange for $898,264,683 in allowed claims.

– More –

•Holders of NorthWestern’s Trust Originated Preferred Securities (Class 8(a) claims) received 2,278,769 shares in exchange for $321,069,399 in allowed claims.  Class 8(a) holders also received 4,366,092 in common stock warrants which may be exercised for a period of three years from the effective date.

•Holders of the Company’s Montana QUIPs (Class 8(b) claims), based on their choices, will receive either their pro rata share of 505,591 shares of new common stock in exchange for their claims, including any litigation claims, or they will continue the litigation against the Company generally referred to as the QUIPS Litigation and will receive a distribution, if any, only upon final resolution of the QUIPS Litigation.

•4,409,100 shares (13.5% of the shares allocated for Class 7 and 9) have been reserved for further distribution to Class 9 claimants at such time as those claims are deemed allowed.  Reserved claims are valued at approximately $140 million.

•Holders of secured bonds, including the Company’s First Mortgage, Pollution Control and Gas Transition Bonds, are not impaired and have been reinstated.

•Unless specifically provided for in the Plan, environmental claims were not impaired and will be satisfied in full.  With respect to the Milltown Dam Superfund site, the Company will fulfill its obligations consistent with the previous court-approved settlement.

•NorthWestern’s old common stock, which traded on the OTC Pink Sheets under the symbol NTHWQ, was cancelled effective today at 5:00 p.m. Eastern time, and no distribution will be available to holders of those securities.

NASDAQ Approves Trading of New Common Stock

NASDAQ National Market has approved the listing of NorthWestern’s new common stock and warrants beginning November 2, 2004.  The Company’s new common stock symbol is “NWEC.” The symbol for the warrants is “NWECW.”  LaSalle Bank will serve as the Company’s stock transfer agent for the new common stock and warrants.

“We are excited about being listed on NASDAQ and having our new common stock begin trading on the national market,” said Drook.  “This swift and successful turnaround was the result of the commitment and collaboration of many people, chief among them NorthWestern’s hard-working employees who helped ensure that our customers were not affected by this process.”

About NorthWestern Energy

NorthWestern Corporation (NASDAQ: NWEC) d/b/a NorthWestern Energy is one of the largest providers of electricity and natural gas in the Upper Midwest and Northwest, serving more than 608,000 customers in Montana, South Dakota and Nebraska.  More information on NorthWestern Energy is available on the Company’s new Web site at www.northwesternenergy.com.

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SPECIAL NOTE REGARDING FORWARD—LOOKING STATEMENTS

On one or more occasions, we may make statements in this news release regarding our assumptions, projections, expectations, targets, intentions or beliefs about future events. All statements other than statements of historical facts, included or incorporated by reference herein relating to management’s current expectations of future financial performance, continued growth, changes in economic conditions or capital markets and changes in customer usage patterns and preferences are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. On September 14, 2003, NorthWestern Corporation filed a voluntary petition for relief under the provisions of Chapter 11 of the Federal Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware. On May 4, 2004, our subsidiary, Netexit, Inc. (f/k/a Expanets, Inc.) filed a voluntary petition for relief under the provisions of Chapter 11 of the Federal Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware.

Words or phrases such as “anticipates,” “may,” “will,” “should,” “believes,” “estimates,” “expects,” “intends,” “plans,” “predicts,” “projects,” “targets,” “will likely result,” “will continue” or similar expressions identify forward-looking statements. Forward-looking statements involve risks and uncertainties which could cause actual results or outcomes to differ materially from those expressed. We caution that while we make such statements in good faith and we believe such statements are based on reasonable assumptions, including without limitation, management’s examination of historical operating trends, data contained in records and other data available from third parties, we cannot assure you that our projections will be achieved. Factors that may cause such differences include but are not limited to:

Factors Relating to Our Bankruptcy

•our ability to obtain and maintain normal terms with vendors and service providers;

•the potential adverse impact of the Chapter 11 case on our liquidity or results of operations;

•our ability to fund and execute our business plan;

•the potential adverse impact of the Netexit Chapter 11 case on our liquidity;

•our ability to avoid or mitigate an adverse ruling as to Magten Asset Management Corporation’s appeal of the order confirming our plan of reorganization;

•our ability to avoid or mitigate an adverse judgment against us in that certain lawsuit seeking to recover assets or damages on behalf of Clark Fork and Blackfoot, L.L.C., one of our subsidiaries which we refer to as Clark Fork, filed by Magten Asset Management Corporation and Law Debenture Trust Company of New York, which we refer to as the QUIPs Litigation;

•our ability to avoid or mitigate an adverse judgment against us in that pending litigation styled as McGreevey et al v. The Montana Power Company, the shareholder class action lawsuit relating to the disposition of the generating and energy related assets by the entity formerly known as The Montana Power Company, excluding our acquisition of the electric and natural gas transmission and distribution business formerly held by The Montana Power Company entity, together with ERISA litigation regarding The Montana Power Company Employee Stock Ownership Plan and 401(k) plan, which has been settled pending approval by the Bankruptcy Court and the U.S. District Court in Montana where the litigation is pending;

3

•our ability to avoid or mitigate an adverse judgment against us in the In Re NorthWestern Securities Litigation and Derivative Litigation relating to the restatement of our 2002 quarterly financial statements and other accounting and financial reporting matters, which has been settled pending approval by the U.S. District Court in South Dakota where the litigation is pending;

•our ability to avoid or mitigate an adverse judgment against us in existing other shareholder and derivative litigation or any additional litigation and regulatory action, including the formal investigation initiated by the SEC, in connection with the restatement of our 2002 quarterly financial statements and other accounting and financial reporting matters, any of which could have a material adverse effect on our liquidity, results of operations and financial condition;

General Factors

•unscheduled generation outages, maintenance or repairs which may reduce revenues and increase cost of sales or may require additional capital expenditures or other increased operating costs;

•our ability to operate pursuant to the terms of our new credit facility and senior secured notes issued on November 1, 2004;

•unanticipated changes in usage, commodity prices, fuel supply costs or availability due to higher demand, shortages, weather conditions, transportation problems or other developments, in combination with reduced availability of trade credit, may reduce revenues or may increase operating costs, each of which would adversely affect our liquidity;

•adverse changes in general economic and competitive conditions in our service territories;

•potential additional adverse federal, state, or local legislation or regulation or adverse determinations by regulators, including the final order of the Montana Public Service Commission, which we refer to as the MPSC, disallowing the recovery of $6.2 million of natural gas costs we incurred during the 2003 tracker year, and an interim order disallowing the recovery of approximately $4.6 million of natural gas costs during the 2004 tracker year, which has had and could continue to have a material adverse affect on our liquidity, results of operations and financial condition;

•increases in interest rates, which will increase our cost of borrowing;

•certain other business uncertainties related to the occurrence or threat of natural disasters, war, hostilities and terrorist actions;

•our ability to attract, motivate and/or retain key employees; and

•our ability to maintain an effective internal control structure.

We have attempted to identify, in context, certain of the factors that we believe may cause actual future experience and results to differ materially from our current expectation regarding the relevant matter or subject area. In addition to the items specifically discussed above, our business and results of operations are subject to the uncertainties described under the caption “Risk Factors” which is a part of the disclosure included in Item 2 of our Quarterly Report on Form 10-Q entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

4

From time to time, oral or written forward-looking statements are also included in our reports on Forms 10-K, 10-Q and 8-K, Proxy Statements on Schedule 14A, news releases and other materials released to the public. Although we believe that at the time made, the expectations reflected in all of these forward-looking statements are and will be reasonable, any or all of the forward-looking statements in this news release, our quarterly reports on Form 10-Q, Forms 10-K and 8-K, our Proxy Statements on Schedule 14A and any other public statements that are made by us may prove to be incorrect. This may occur as a result of inaccurate assumptions or as a consequence of known or unknown risks and uncertainties. Many factors discussed in this news release, certain of which are beyond our control, will be important in determining our future performance. Consequently, actual results may differ materially from those that might be anticipated from forward-looking statements. In light of these and other uncertainties, you should not regard the inclusion of a forward-looking statement in this news release or other public communications that we might make as a representation by us that our plans and objectives will be achieved, and you should not place undue reliance on such forward-looking statements.

We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. However, your attention is directed to any further disclosures made on related subjects in our subsequent annual and periodic reports filed with the SEC on Forms 10-K, 10-Q and 8-K and Proxy Statements on Schedule 14A.

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5

EX-99.3

Exhibit 99.3

	NorthWestern Corporation
	d/b/a NorthWestern Energy
	125 S. Dakota Ave.
	Sioux Falls, SD 57104
	www.northwesternenergy.com
News Release	NASDAQ: NWEC

FOR IMMEDIATE RELEASE

Media/Investor Relations Contact:

Roger Schrum

605-978-2848

roger.schrum@northwestern.com

NORTHWESTERN CORPORATION COMPLETES SALE OF $225 MILLION
IN SENIOR SECURED NOTES IN RULE 144A OFFERING

Company Also Enters into New $225 Million Credit Facility

SIOUX FALLS, S.D. – Nov. 1, 2004 – NorthWestern Corporation (NASDAQ: NWEC) d/b/a NorthWestern Energy announced today that it has completed the sale of $225 million of its Senior Secured Notes due 2014 (the “Senior Notes”) in a Rule 144A private offering.

The Senior Notes are due November 1, 2014, and bear annual interest of 5⁷/₈% paid semi-annually.  The Senior Notes are collateralized by two series of existing first mortgage bonds secured by NorthWestern’s regulated utility assets in Montana, South Dakota and Nebraska. The Senior Notes were priced at par and will have five years of call protection.

According to Gary G. Drook, President and Chief Executive Officer of the Company, the net proceeds of the offering were used to repay a portion of the amounts outstanding under the Company’s $390 million term loan credit facility and to pay related fees and expenses.

“We are extremely pleased with the support this offering received from investors,” said Drook.  “This financing is one of the lowest priced callable notes sold recently in the high-yield market.  We believe this reflects investors’ strong interest in NorthWestern as we emerge from Chapter 11 today.”

Credit Suisse First Boston and Lehman Brothers acted as joint book-running managers, and Deutsche Bank Securities was co-manager.

New $225 Million Credit Facility Closed

In addition, NorthWestern announced that it has entered into a new $225 million secured Credit Facility (“New Credit Facility”) consisting of a $125 million five-year revolving tranche (the “Revolver”) and a $100 million seven-year term tranche (the “Term B Loan”).

According to Brian B. Bird, NorthWestern’s Chief Financial Officer, proceeds of the Revolver will be used to replace existing letters of credit initially issued under the Company’s debtor-in-possession financing and to provide borrowing capacity for general corporate purposes.  The Term B Loan was used to repay the remainder of the Company’s $390 million term loan facility.

– More –

The Revolver and the Term B Loan were priced at the London InterBank Offered Rate (LIBOR) plus 175 basis points.

“Our financing strategy as we emerge from Chapter 11 was to replace our undrawn DIP facility with a revolver to assure adequate liquidity for utility operations while refinancing some of our near-term debt to reduce interest expense and extend maturities,” Bird said. “We have successfully met those goals, and we have been able to reduce debt through the use of available cash.  We remain focused on further reducing debt to become a strong investment grade company.”

The Credit Facility was arranged by Lehman Brothers and Deutsche Bank.

About NorthWestern Energy

NorthWestern Corporation d/b/a NorthWestern Energy is one of the largest providers of electricity and natural gas in the Upper Midwest and Northwest, serving more than 608,000 customers in Montana, South Dakota and Nebraska.  More information on NorthWestern Energy is available on the Company’s new Web site www.northwesternenergy.com.

SPECIAL NOTE REGARDING FORWARD—LOOKING STATEMENTS

On one or more occasions, we may make statements in this news release regarding our assumptions, projections, expectations, targets, intentions or beliefs about future events. All statements other than statements of historical facts, included or incorporated by reference herein relating to management’s current expectations of future financial performance, continued growth, changes in economic conditions or capital markets and changes in customer usage patterns and preferences are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. On September 14, 2003, NorthWestern Corporation filed a voluntary petition for relief under the provisions of Chapter 11 of the Federal Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware. On May 4, 2004, our subsidiary, Netexit, Inc. (f/k/a Expanets, Inc.) filed a voluntary petition for relief under the provisions of Chapter 11 of the Federal Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware.

Words or phrases such as “anticipates,” “may,” “will,” “should,” “believes,” “estimates,” “expects,” “intends,” “plans,” “predicts,” “projects,” “targets,” “will likely result,” “will continue” or similar expressions identify forward-looking statements. Forward-looking statements involve risks and uncertainties which could cause actual results or outcomes to differ materially from those expressed. We caution that while we make such statements in good faith and we believe such statements are based on reasonable assumptions, including without limitation, management’s examination of historical operating trends, data contained in records and other data available from third parties, we cannot assure you that our projections will be achieved. Factors that may cause such differences include but are not limited to:

Factors Relating to Our Bankruptcy

•our ability to obtain and maintain normal terms with vendors and service providers;

•the potential adverse impact of the Chapter 11 case on our liquidity or results of operations;

2

•our ability to fund and execute our business plan;

•the potential adverse impact of the Netexit Chapter 11 case on our liquidity;

•our ability to avoid or mitigate an adverse ruling as to Magten Asset Management Corporation’s appeal of the order confirming our plan of reorganization;

•our ability to avoid or mitigate an adverse judgment against us in that certain lawsuit seeking to recover assets or damages on behalf of Clark Fork and Blackfoot, L.L.C., one of our subsidiaries which we refer to as Clark Fork, filed by Magten Asset Management Corporation and Law Debenture Trust Company of New York, which we refer to as the QUIPs Litigation;

•our ability to avoid or mitigate an adverse judgment against us in that pending litigation styled as McGreevey et al v. The Montana Power Company, the shareholder class action lawsuit relating to the disposition of the generating and energy related assets by the entity formerly known as The Montana Power Company, excluding our acquisition of the electric and natural gas transmission and distribution business formerly held by The Montana Power Company entity, together with ERISA litigation regarding The Montana Power Company Employee Stock Ownership Plan and 401(k) plan, which has been settled pending approval by the Bankruptcy Court and the U.S. District Court in Montana where the litigation is pending;

•our ability to avoid or mitigate an adverse judgment against us in the In Re NorthWestern Securities Litigation and Derivative Litigation relating to the restatement of our 2002 quarterly financial statements and other accounting and financial reporting matters, which has been settled pending approval by the U.S. District Court in South Dakota where the litigation is pending;

•our ability to avoid or mitigate an adverse judgment against us in existing other shareholder and derivative litigation or any additional litigation and regulatory action, including the formal investigation initiated by the SEC, in connection with the restatement of our 2002 quarterly financial statements and other accounting and financial reporting matters, any of which could have a material adverse effect on our liquidity, results of operations and financial condition;

General Factors

•unscheduled generation outages, maintenance or repairs which may reduce revenues and increase cost of sales or may require additional capital expenditures or other increased operating costs;

•our ability to operate pursuant to the terms of our new credit facility and senior secured notes issued on November 1, 2004;

•unanticipated changes in usage, commodity prices, fuel supply costs or availability due to higher demand, shortages, weather conditions, transportation problems or other developments, in combination with reduced availability of trade credit, may reduce revenues or may increase operating costs, each of which would adversely affect our liquidity;

•adverse changes in general economic and competitive conditions in our service territories;

3

•potential additional adverse federal, state, or local legislation or regulation or adverse determinations by regulators, including the final order of the Montana Public Service Commission, which we refer to as the MPSC, disallowing the recovery of $6.2 million of natural gas costs we incurred during the 2003 tracker year, and an interim order disallowing the recovery of approximately $4.6 million of natural gas costs during the 2004 tracker year, which has had and could continue to have a material adverse affect on our liquidity, results of operations and financial condition;

•increases in interest rates, which will increase our cost of borrowing;

•certain other business uncertainties related to the occurrence or threat of natural disasters, war, hostilities and terrorist actions;

•our ability to attract, motivate and/or retain key employees; and

•our ability to maintain an effective internal control structure.

We have attempted to identify, in context, certain of the factors that we believe may cause actual future experience and results to differ materially from our current expectation regarding the relevant matter or subject area. In addition to the items specifically discussed above, our business and results of operations are subject to the uncertainties described under the caption “Risk Factors” which is a part of the disclosure included in Item 2 of our Quarterly Report on Form 10-Q entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

From time to time, oral or written forward-looking statements are also included in our reports on Forms 10-K, 10-Q and 8-K, Proxy Statements on Schedule 14A, news releases and other materials released to the public. Although we believe that at the time made, the expectations reflected in all of these forward-looking statements are and will be reasonable, any or all of the forward-looking statements in this news release, our quarterly reports on Form 10-Q, Forms 10-K and 8-K, our Proxy Statements on Schedule 14A and any other public statements that are made by us may prove to be incorrect. This may occur as a result of inaccurate assumptions or as a consequence of known or unknown risks and uncertainties. Many factors discussed in this news release, certain of which are beyond our control, will be important in determining our future performance. Consequently, actual results may differ materially from those that might be anticipated from forward-looking statements. In light of these and other uncertainties, you should not regard the inclusion of a forward-looking statement in this news release or other public communications that we might make as a representation by us that our plans and objectives will be achieved, and you should not place undue reliance on such forward-looking statements.

We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. However, your attention is directed to any further disclosures made on related subjects in our subsequent annual and periodic reports filed with the SEC on Forms 10-K, 10-Q and 8-K and Proxy Statements on Schedule 14A.

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4

EX-99.4

Exhibit 99.4

	NorthWestern Corporation
	d/b/a NorthWestern Energy
	125 S. Dakota Ave.
	Sioux Falls, SD 57104
	www.northwesternenergy.com
News Release	NASDAQ: NWEC

FOR IMMEDIATE RELEASE

Media/Investor Relations Contact:

Roger Schrum

605-978-2848

roger.schrum@northwestern.com

NORTHWESTERN CORPORATION BOARD OF DIRECTORS

CHOOSES CHAIRMAN AND COMMITTEES

SIOUX FALLS, S.D. – Nov. 1, 2004 – NorthWestern Corporation (NASDAQ: NWEC) d/b/a NorthWestern Energy today announced that its newly constituted Board of Directors has chosen Dr. E. Linn Draper, Jr. as nonexecutive Chairman of the Board.

Dr. Draper recently retired as Chairman, President and Chief Executive Officer of American Electric Power.

Additionally, the Board has organized the following committees:

•Audit Committee, chaired by Stephen P. Adik, with Corbin A. McNeill, Jr. and Jon S. Fossel as committee members;

•Human Resources Committee, chaired by Philip L. Maslowe, with Mr. McNeill and Julia L. Johnson as committee members; and

•Governance Committee, chaired by Mr. Fossel, and with Ms. Johnson and Dr. Draper as committee members.

For more information on NorthWestern’s Board of Directors, please visit the Corporate Governance section of www.northwesternenergy.com.

About NorthWestern Energy

NorthWestern Corporation d/b/a NorthWestern Energy is one of the largest providers of electricity and natural gas in the Upper Midwest and Northwest, serving more than 608,000 customers in Montana, South Dakota and Nebraska.   More information on NorthWestern Energy is available on the Company’s new Web site at www.northwesternenergy.com.

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