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200410978
<br />Agreement), and (B) to cash collateralize Letters of Credit pursuant to and in accordance
<br />with Section 8 of the Credit Agreement.
<br />As used herein, "Revolving Credit Applicable Share" means, as of any day, a
<br />fraction (expressed as a percentage rounded to the second decimal place), (i) the
<br />numerator of which is the aggregate principal amount of the First Mortgage Bonds,
<br />Collateral (2004) Series A that are Outstanding on such day, and (ii) the denominator of
<br />which is the sum of (a) the aggregate principal amount of the First Mortgage Bonds,
<br />Collateral (2004) Series A that are Outstanding on such day, plus (b) the aggregate
<br />principal amount of the First Mortgage Bonds, Collateral (2004) Series A, due 2009, of
<br />the Company (the "Montana Revolving Credit Bonds ") that are outstanding on such day
<br />under the Company's Mortgage and Deed of Trust, dated as of October 1, 1945, relating
<br />(among other things) to property acquired by the Company from NorthWestem Energy,
<br />L.L.C., which in turn acquired such property from The Montana Power Company (as
<br />amended and supplemented, the "Montana Mortgage'). Simultaneously with the
<br />issuance and registration of the First Mortgage Bonds, Collateral (2004) Series A in the
<br />name of the Collateral Agent (for the same purpose), the Montana Revolving Credit
<br />Bonds will be issued to the Collateral Agent to secure the Revolving Credit Obligations
<br />under the Credit Agreement. Initially, the Revolving Credit Applicable Share will be
<br />28.00% (being the expression as a percentage (rounded to the second decimal place) of a
<br />fraction, the numerator of which is $35,000,000 (the aggregate principal amount of the
<br />First Mortgage Bonds, Collateral (2004) Series A that are to be issued and become
<br />Outstanding) and the denominator of which is $125,000,000 (the sum of $35,000,000, the
<br />aggregate principal amount of the First Mortgage Bonds, Collateral (2004) Series A that
<br />are to be issued and become Outstanding, plus $90,000,000, the aggregate principal
<br />amount of the Montana Revolving Credit Bonds that are to be issued and become
<br />outstanding under the Montana Mortgage simultaneously with the issuance of the First
<br />Mortgage Bonds, Collateral (2004) Series A). Pursuant to the Collateral Agreement, the
<br />Collateral Agent has agreed to furnish to the Trustee (with a copy to the Company) as
<br />soon as practicable after any change in the Revolving Credit Applicable Share, a
<br />certificate, signed by a person purporting to be its duly authorized officer, notifying the
<br />Trustee of such change in the Revolving Credit Applicable Share (a "Revolving g redit
<br />Applicable Share Certificate "). Each Revolving Credit Applicable Share Certificate shall
<br />set forth (i) the changed Revolving Credit Applicable Share, (ii) the date such change
<br />occurred, (iii) the aggregate principal amount of the First Mortgage Bonds, Collateral
<br />(2004) Series A then Outstanding, and (iv) the aggregate principal amount of the
<br />Montana Revolving Credit Bonds then outstanding under the Montana Mortgage. The
<br />Trustee may conclusively presume that the Revolving Credit Applicable Share is 28.00%
<br />unless and until the Trustee receives a Revolving Credit Applicable Share Certificate.
<br />Following receipt by the Trustee of a Revolving Credit Applicable Share Certificate, the
<br />Trustee may conclusively presume that the Revolving Credit Applicable Share is as set
<br />forth in such Revolving Credit Applicable Share Certificate unless and until the Trustee
<br />receives a subsequent Revolving Credit Applicable Share Certificate (and the Trustee
<br />shall be fully protected in relying thereon).
<br />First Mortgage Bonds, Collateral (2004) Series A shall mature on November 1,
<br />2009 (the "Revolving Credit Maturity Date'), with the unpaid principal of the First
<br />NY55/405431.7
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