INDEX OF DEFINED TERMS

	Page
AAA	39
Affiliate	1
Agreement	1
Balance Sheet	2
Balance Sheet Date	2
Base Claim	35
Basket	35
Business	2
Business Day	2
Buyer	1
Buyer Claim	35
Buyer Disclosure Schedule	2
Buyer Indemnified Parties	34
Buyer Required Regulatory Approvals	24
Ceiling	35
CERCLA	2
Claim Notice	36
Closing	15
Closing Consideration	11
Closing Date	15
Code	3
Confidentiality Agreement	3
Contract	3
Current Assets	3
Current Liabilities	3
Dispute	39
Dispute Notice	13
Encumbrances	3
Environmental Laws	4
Environmental Permits	19
Estimated CapEx Amount	11
Estimated Cash Amount	11
Estimated Closing Adjustment	12
Estimated Debt Repayment Amount	11
Estimated Net Working Capital	11
FERC	4
Final CapEx Amount	14
Final Cash Amount	14
Final Closing Adjustment	14
Final Closing Balance Sheet	14
Final Debt Repayment Amount	14
Final Net Working Capital	14

 

 

 

Financial Statements	5
GAAP	5
Governmental Authority	5
Hazardous Substances	5
HSR Act	5
Indemnified Party	36
Indemnifying Party	36
Independent Accounting Firm	5
Initial Purchase Price	11
Intellectual Property	6
Interest	1
Interest Holder Agreement	1
Interim Balance Sheet	6
Losses	34
Material Adverse Effect	6
Material Contract	21
Material Contracts	7
Material Leases	7
Net Working Capital	7
New York Courts	40
Notice Period	36
Operating Agreement	7
Partnership	1
Partnership Agreement	7
Permits	22
Permitted Encumbrances	8
Person	8
Preliminary CapEx Amount	12
Preliminary Cash Amount	12
Preliminary Closing Balance Sheet	12
Preliminary Debt Repayment Amount	12
Preliminary Net Working Capital	12
Preliminary Statement	12
Prime Rate	9
Purchase Price	11
Real Property	18
Reference Net Working Capital	9
Representatives	9
Rules	39
Seller	1
Seller Claim	35
Seller Disclosure Schedule	9
Seller Indemnified Parties	35
Seller Required Regulatory Approvals	17
Seller’s Knowledge	9
Software	10

 

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Subsidiary	10
Survival Period	34
Tax	10
Tax Return	10
Taxing Authority	10
TCPL	10
Termination Date	33
Third Party Claim	36
Transfer Taxes	10

 

 

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GENERAL PARTNERSHIP INTEREST PURCHASE AGREEMENT

This GENERAL PARTNERSHIP INTEREST PURCHASE AGREEMENT, dated as of November 1, 2006 (this “ Agreement ”), is made and entered into by and between Tuscarora Gas Pipeline Co., a Nevada corporation (“ Seller ”), and TC Tuscarora Intermediate Limited Partnership, a Delaware limited partnership (“ Buyer ”).

WHEREAS, Seller owns a 50% general partnership interest in Tuscarora Gas Transmission Company, a Nevada general partnership (the “ Partnership ”);

WHEREAS, Seller desires to sell a 49% general partnership interest in the Partnership (the “ Interest ”);

WHEREAS, concurrently with the execution of this Agreement, Seller and Buyer are entering into a General Partnership Interest Holder Agreement relating to Buyer’s option to purchase an additional 1% general partnership interest in the Partnership from Seller, on the terms and subject to the conditions contained therein (the “ Interest Holder Agreement ”); and

WHEREAS, on the terms and subject to the conditions contained in this Agreement, Buyer desires to purchase the Interest from Seller, and Seller desires to sell the Interest to Buyer;

NOW THEREFORE, in consideration of the mutual covenants, representations, warranties and agreements contained herein, and of other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound hereby, the parties hereto hereby agree as follows:

ARTICLE I

DEFINITIONS

1.1                                  Definitions . As used in this Agreement, the following terms have the meanings specified or referred to in this Section 1.1:

(1)                                   “ AAA ” shall have the meaning set forth in Section 10.5(a).

(2)                                   “ Affiliate ” means a Person that directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, a specified Person. A Person shall be deemed to control another Person if such first Person possesses, directly or indirectly, the power to direct, or cause the direction of, the management and policies of such other Person, whether through the ownership of voting securities, by Contract or otherwise.

 

(3)                                   “ Agreement ” shall have the meaning set forth in the preamble to this Agreement.

(4)                                   “ Balance Sheet ” means the audited balance sheet of the Partnership as of December 31, 2005 included in the Financial Statements.

(5)                                   “ Balance Sheet Date ” means December 31, 2005.

(6)                                   “ Base Claim ” shall have the meaning set forth in Section 9.2(b).

(7)                                   “ Basket ” shall have the meaning set forth in Section 9.2(b).

(8)                                   “ Business ” means the business of the Partnership as conducted on the date of this Agreement.

(9)                                   “ Business Day ” means any day other than Saturday, Sunday and any day which is a legal holiday or a day on which banking institutions in the State of New York are authorized by law or other governmental action to close.

(10)                             “ Buyer ” shall have the meaning set forth in the preamble to this Agreement.

(11)                             “ Buyer Claim ” shall have the meaning set forth in Section 9.2(b).

(12)                             “ Buyer Disclosure Schedule ” means the disclosure schedule of Buyer referred to in, and delivered pursuant to, this Agreement.

(13)                             “ Buyer Indemnified Parties ” shall have the meaning set forth in Section 9.2(a).

(14)                             “ Buyer Required Regulatory Approvals ” shall have the meaning set forth in Section 5.3(b).

(15)                             “ Ceiling ” shall have the meaning set forth in Section 9.2(b).

(16)                             “ CERCLA ” means the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C. §9601, et seq., as amended.

(17)                             “ Claim Notice ” shall have the meaning set forth in Section 9.4(a).

(18)                             “ Closing ” shall have the meaning set forth in Section 3.1.

(19)                             “ Closing Consideration ” shall have the meaning set forth in Section 2.2.

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(20)                             “ Closing Date ” shall have the meaning set forth in Section 3.1.

(21)                             “ Code ” means the Internal Revenue Code of 1986, as amended.

(22)                             “ Confidentiality Agreement ” means the Confidentiality Agreement, dated July 20, 2006 between Sierra Pacific Resources and an Affiliate of Buyer.

(23)                             “ Contract ” means any written contract, agreement, indenture, note, bond, mortgage, loan, instrument, lease or license.

(24)                             “ Current Assets ” with respect to the Partnership, means, as of the applicable date, without duplication, the sum of the following items, each as set forth on the relevant balance sheet of the Partnership, (i) accounts receivable, (ii) other current assets and (iii) prepaid expenses (excluding, for the avoidance of doubt, cash and cash equivalents (including money market funds) and customer deposits), in each case, in accordance with GAAP and as such terms are used in, and calculated on a basis consistent with the Interim Balance Sheet.

(25)                             “ Current Liabilities ” with respect to the Partnership, means, as of the applicable date, without duplication, the sum of the following items, each as set forth on the relevant balance sheet of the Partnership, (i) accounts payable, (ii) payable to partners, (iii) accrued taxes other than income taxes, (iv) accrued interest and (v) current portion of long-term debt (excluding, for the avoidance of doubt, customer deposits (which are referred to as “other accrued liabilities” in the Interim Balance Sheet)), in each case, in accordance with GAAP and as such terms are used in, and calculated on a basis consistent with the Interim Balance Sheet.

(26)                             “ Dispute ” shall have the meaning set forth in Section 10.5(a).

(27)                             “ Dispute Notice ” shall have the meaning set forth in Section 2.3(e).

(28)                             “ Encumbrances ” means any mortgages, deeds of trust, pledges, liens, security interests, conservation easements, deed restrictions, charges and other encumbrances, other than any Permitted Encumbrances.

(29)                             “ Environmental Laws ” means all federal, state and local laws, including the common law, regulations, rules, ordinances, codes, decrees, judgments, directives, or judicial or administrative orders relating to pollution or protection of the environment, natural resources or human health and safety, including laws relating to Hazardous Substances (including ambient air, surface water, groundwater, land, surface and subsurface strata) or otherwise relating to the manufacture, processing, distribution, use, treatment, storage, transport or

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handling of Hazardous Substances, laws relating to record keeping, notification, disclosure and reporting requirements respecting Hazardous Substances, and laws relating to the management and use of natural resources.

(30)                             “ Environmental Permits ” shall have the meaning set forth in Section 4.13(a).

(31)                             “ Estimated CapEx Amount ” shall have the meaning set forth in Section 2.3(a)(iii).

(32)                             “ Estimated Cash Amount ” shall have the meaning set forth in Section 2.3(a)(i).

(33)                             “ Estimated Closing Adjustment ” shall have the meaning set forth in Section 2.3(b).

(34)                             “ Estimated Debt Repayment Amount ” shall have the meaning set forth in Section 2.3(a)(iv).

(35)                             “ Estimated Net Working Capital ” shall have the meaning set forth in Section 2.3(a)(ii).

(36)                             “ FERC ” means the Federal Energy Regulatory Commission or any successor thereto.

(37)                             “ Final CapEx Amount ” shall have the meaning set forth in Section 2.3(g).

(38)                             “ Final Cash Amount ” shall have the meaning set forth in Section 2.3(g).

(39)                             “ Final Closing Adjustment ” shall have the meaning set forth in Section 2.3(h).

(40)                             “ Final Closing Balance Sheet ” shall have the meaning set forth in Section 2.3(g).

(41)                             “ Final Debt Repayment Amount ” shall have the meaning set forth in Section 2.3(g).

(42)                             “ Final Net Working Capital ” shall have the meaning set forth in Section 2.3(g).

(43)                             “ Financial Statements ” means (i) the Balance Sheet and the audited statement of income, partners’ capital and cash flows of the Partnership for the fiscal year ended December 31, 2005 and (ii) the Interim Balance Sheet and the unaudited statement of income, partners’ capital and cash

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flows of the Partnership for the six (6) months ended June 30, 2006, including the notes thereto.

(44)                             “ GAAP ” means generally accepted accounting principles as used in the United States in effect from time to time.

(45)                             “ Governmental Authority ” means any executive, legislative, judicial, regulatory or administrative agency, body, commission, department, board, court, tribunal, arbitrating body or authority of the United States or any foreign country, or any state, local or other governmental subdivision thereof.

(46)                             “ Hazardous Substances ” means (i) any petrochemical or petroleum products, radioactive materials, asbestos in any form that is or could become friable, urea formaldehyde foam insulation and transformers or other equipment that contain dielectric fluid which may contain levels of polychlorinated biphenyls, (ii) any chemicals, materials or substances defined as or included in the definition of “hazardous substances,” “hazardous wastes,” “hazardous materials,” “restricted hazardous materials,” “extremely hazardous substances,” “toxic substances,” “contaminants” or “pollutants” or words of similar meaning and regulatory effect under Environmental Laws or (iii) any other chemical, material or substance, exposure to which is prohibited, limited or regulated by or which could give rise to liability under any applicable Environmental Law.

(47)                             “ HSR Act ” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended.

(48)                             “ Indemnified Party ” shall have the meaning set forth in Section 9.4(a).

(49)                             “ Indemnifying Party ” shall have the meaning set forth in Section 9.4(a).

(50)                             “ Independent Accounting Firm ” means a mutually acceptable nationally recognized firm of independent chartered accountants that has not provided services to either Seller or Buyer or any of their Affiliates in the preceding three (3) years, or if no such firm is available and willing to serve, then a mutually acceptable expert in public accounting, in each case, upon which Buyer and Seller shall have mutually agreed.

(51)                             “ Initial Purchase Price ” shall have the meaning set forth in Section 2.2.

(52)                             “ Intellectual Property ” means all:  (i) patents and patent applications, registrations and disclosures and all related continuations, divisionals, continuations-in-part, reissues, reexaminations, utility models, certificates of invention and design patents, (ii) trademarks, service marks, trade

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dress, logos, corporate names, trade names and internet domain names, together with the goodwill associated with any of the foregoing, and all applications and registrations therefor, (iii) copyrights and registrations and applications therefor, copyrightable works of authorship and moral rights, (iv) confidential and proprietary information, including trade secrets, discoveries, concepts, ideas, research and development, financial, marketing and business data, pricing and cost information, business and marketing plans, algorithms, know-how, formulae, inventions (whether or not patentable), processes, techniques, technical data, designs, drawings, specifications, databases, and customer and supplier lists and information, in each case to the extent confidential and proprietary, excluding any rights in respect of any of the items described in this clause (iv) that comprise or are protected by patents or otherwise by clauses (i)-(iii) and (v) of this definition, and (v) Software.

(53)                             “ Interest ” shall have the meaning set forth in the recitals to this Agreement.

(54)                             “ Interest Holder Agreement ” shall have the meaning set forth in the recitals to this Agreement.

(55)                             “ Interim Balance Sheet ” means that certain unaudited balance sheet of the Partnership as at June 30, 2006 included in the Financial Statements.

(56)                             “ Material Adverse Effect ” means a material adverse effect on the business, results of operations, ownership, operation, or financial condition of the Partnership or the Business taken as a whole, or that materially impedes the ability of Seller to consummate the transactions contemplated by this Agreement, except for any such effect or impediment (to the extent, in the case of clauses (i), (ii) or (iii), such effect or impediment does not have a disproportionate impact on the Partnership or the Business relative to other entities operating similar businesses) arising out of or relating to (i) any change or effect resulting from the general state of the industries in which the Partnership operates (including (A) changes in pricing levels, (B) changes in the international, national, regional or local wholesale or retail markets for natural gas, (C) changes in the North American, national, regional or local interstate natural gas pipeline systems, or (D) changes in applicable laws, rules, regulations or decisions of the FERC or judgments, orders or decrees of courts affecting the interstate natural gas transmission industry, or rate orders, motions, complaints or other actions affecting the Partnership), (ii) any change or effect resulting from changes in the international, national, regional or local markets for any supplies used by the Business, (iii) any change or effect resulting from changes in general economic, political or business conditions (including changes in interest rates or debt, equity, financial, banking or currency markets), (iv) any change or effect resulting from any change in GAAP, (v) any change or effect resulting from the negotiation, execution, announcement, pendency or consummation of the transactions contemplated by this Agreement, including the impact thereof on relationships,

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contractual or otherwise, with customers, suppliers, distributors, partners, joint owners or venturers, or employees, other than Sierra Pacific Resources and its Affiliates, (vi) any change or effect resulting from any action taken by Seller, the Partnership, Buyer or any of their respective Representatives or Affiliates or other action required, contemplated or permitted by this Agreement or consented to by Buyer, (vii) any change or effect resulting from acts of war, armed hostilities or terrorism, (viii) any change or effect resulting from changes in weather or climate, (ix) any materially adverse change in or effect on the Business which is cured (including by the payment of money) before the Termination Date, or (x) any circumstance, matter or condition described in the Seller Disclosure Schedule.

(57)                             “ Material Contracts ” shall have the meaning set forth in Section 4.15 of this Agreement

(58)                             “ Material Leases ” shall mean, as of the date of this Agreement, all leases under which the Partnership is a lessee, lessor or under which the Partnership otherwise has any interest (i) with annual payments greater than $250,000 or (ii) which are otherwise material to the Business.

(59)                             “ Net Working Capital ” means (i) Current Assets minus (ii) Current Liabilities.

(60)                             “ New York Courts ” shall have the meaning set forth in Section 10.5(e).

(61)                             “ Operating Agreement ” means the Operating Agreement, dated as of October 12, 1995, by and between the Partnership and Tuscarora Gas Operating Company, as amended.

(62)                             “ Partnership ” shall have the meaning set forth in the recitals to this Agreement.

(63)                             “ Partnership Agreement ” means the Tuscarora Gas Transmission Company General Partnership Agreement, dated as of June 11, 1993, by and between Seller and TCPL, as amended by that First Amendment to General Partnership Agreement, dated as of September 1, 2000, as amended by that Second Amendment to General Partnership Agreement, dated as of December 17, 2003, and as may be further amended from time to time.

(64)                             “ Permits ” shall have the meaning set forth in Section 4.17.

(65)                             “ Permitted Encumbrances ” means (i) all exceptions, restrictions, easements, covenants, charges, permits, servitudes, rights of way and Encumbrances of record or that are set forth in an applicable FERC project license or title insurance policy, provided that Seller has provided or made available a copy of such license or insurance policy to Buyer, (ii) all matters of record and any state of facts that a current survey or inspection of the Real Property would disclose and which do not materially and adversely affect the

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ability of the Partnership to conduct the Business as presently conducted, (iii) mortgages, liens, pledges, charges, Encumbrances and restrictions incurred in connection with the Partnership’s purchase of properties and assets after the Balance Sheet Date securing all or a portion of the purchase price therefor, (iv) statutory Encumbrances for Taxes, assessments or other governmental charges not yet due and payable or that may be subsequently paid without penalty or interest or that are being contested in good faith in (if then appropriate) appropriate proceedings, (v) mechanics’, carriers’, workers’, repairman’s, materialman’s, warehousemen’s, employees’, landlord’s, construction and other similar Encumbrances arising or incurred in the ordinary course of business consistent with past practice relating to obligations that are not yet due and payable or that are being contested in good faith in (if then appropriate) appropriate proceedings, (vi) requirements and restrictions under zoning, planning, building, entitlement, conservation, land use and environmental laws and regulations (including municipal bylaws and permits, consents and authorizations under such laws and regulations), and development, site plan, subdivision or other agreements with municipalities which do not materially and adversely affect the ability of the Partnership to conduct the Business as presently conducted, (vii) Encumbrances contemplated by or set forth in the Partnership Agreement or the Operating Agreement, (viii) the rights of lessors, lessees, licensors and licensees under leases or licenses of the Real Property, and (ix) such other liens, defects, irregularities, imperfections in or failure of title, charges, easements, restrictions and other Encumbrances which would not, individually or in the aggregate, have a Material Adverse Effect.

(66)                             “ Person ” means any individual, partnership, joint venture, corporation, limited liability company, limited liability partnership, trust, unincorporated organization or Governmental Authority or any department or agency thereof.

(67)                             “ Preliminary CapEx Amount ” shall have the meaning set forth in Section 2.3(c)(iv).

(68)                             “ Preliminary Cash Amount ” shall have the meaning set forth in Section 2.3(c)(ii).

(69)                             “ Preliminary Closing Balance Sheet ” shall have the meaning set forth in Section 2.3(c)(i).

(70)                             “ Preliminary Debt Repayment Amount ” shall have the meaning set forth in Section 2.3(c)(v).

(71)                             “ Preliminary Net Working Capital ” shall have the meaning set forth in Section 2.3(c)(iii).

(72)                             “ Preliminary Statement ” shall have the meaning set forth in Section 2.3(c).

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(73)                             “ Prime Rate ” means the U.S. prime rate of interest published in the “Money Rates” column of the Eastern Edition of The Wall Street Journal on the Closing Date.

(74)                             “ Purchase Price ” shall have the meaning set forth in Section 2.2.

(75)                             “ Real Property ” has the meaning set forth in Section 4.9.

(76)                             “ Reference Net Working Capital ” means $ - 3,550,054.

(77)                             “ Representatives ” means with respect to a particular Person, any agent, consultant, advisor, accountant, financial advisor, legal counsel or other representative of that Person.

(78)                             “ Rules ” shall have the meaning set forth in Section 10.5(a).

(79)                             “ Seller ” shall have the meaning set forth in the preamble to this Agreement.

(80)                             “ Seller Claim ” shall have the meaning set forth in Section 9.3(b).

(81)                             “ Seller Disclosure Schedule ” means the disclosure schedule of Seller referred to in, and delivered pursuant to, this Agreement.

(82)                             “ Seller’s Knowledge ” means the actual knowledge of Greg Galbraith and Julie Sartor, after reasonable inquiry of each of their respective direct reports.

(83)                             “ Seller Required Regulatory Approvals ” shall have the meaning set forth in Section 4.3(b).

(84)                             “ Software ” means any and all (i) computer programs, including any and all software implementations of algorithms, models and methodologies, whether in source code or object code, (ii) databases and compilations, including any and all data and collections of data, whether machine readable or otherwise, (iii) descriptions, flow-charts and other work product used to design, plan, organize and develop any of the foregoing, screens, user interfaces, report formats, firmware, development tools, templates, menus, buttons and icons, and (iv) all documentation, including user manuals and other training documentation, related to any of the foregoing.

(85)                             “ Subsidiary ” of any Person (the “Subject Person”) means any Person, whether incorporated or unincorporated, of which (i) at least 50% of the securities or ownership interests having by their terms ordinary voting power to elect a majority of the board of directors or other Persons performing similar functions, (ii) a general partner interest or (iii) a managing member interest, is

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directly or indirectly owned or controlled by the Subject Person or by one or more of its respective Subsidiaries.

(86)                             “ Survival Period ” shall have the meaning set forth in Section 9.1(c).

(87)                             “ Tax ” means any tax, charge, fee, levy, penalty or other assessment imposed by any U.S. federal, state, local or foreign Taxing Authority, including any excise, property, income, sales, transfer, franchise, payroll, withholding, social security or other tax, including any interest, penalties or additions attributable thereto.

(88)                             “ Tax Return ” means any return, report, information return, declaration, claim for refund or other document (including any related or supporting information) supplied or required to be supplied to any authority with respect to Taxes and including any supplement or amendment thereof.

(89)                             “ Taxing Authority ” means the Internal Revenue Service and any other Governmental Authority responsible for the administration of any Tax.

(90)                             “ Termination Date ” shall have the meaning set forth in Section 8.1(b).

(91)                             “ TCPL ” means TCPL Tuscarora Ltd., a Delaware corporation.

(92)                             “ Third Party Claim ” shall have the meaning set forth in Section 9.4(a).

(93)                             “ Transfer Taxes ” means any and all transfer Taxes, including sales, use, excise, stock, stamp, documentary, filing, recording, permit, license, authorization and similar Taxes, fees, duties, levies, customs, tariffs, imposts, assessments, obligations and charges.

ARTICLE II

PURCHASE AND SALE OF GENERAL PARTNERSHIP INTEREST

2.1                                  Purchase and Sale . Upon the terms and subject to the satisfaction (or waiver, if permitted) of the conditions contained in this Agreement, Buyer agrees to purchase from Seller and Seller agrees to sell, assign, convey, transfer and deliver to Buyer, the Interest.

2.2                                  Purchase Price . Pursuant to Article III, at the Closing, Buyer shall pay, in consideration for the purchase of the Interest pursuant to Section 2.1, in cash the sum of (a) $98,000,000 and (b) 49% of the Estimated Cash Amount (together, the “ Initial Purchase Price ”), as adjusted by the Estimated Closing Adjustment pursuant to Section 2.3(b) (the “ Closing Consideration ”). The Closing Consideration is subject to

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adjustment following the Closing by the Final Closing Adjustment and, as so adjusted, is referred to herein as the “ Purchase Price .”

2.3                                  Purchase Price Adjustment .

(a)                                   No later than two (2) Business Days prior to the Closing Date, Seller shall prepare and deliver to Buyer a certificate of an officer of Seller setting forth its good faith estimate of (i) the aggregate amount of cash and cash equivalents (including money market funds) of the Partnership as of the Closing Date (the “ Estimated Cash Amount ”), (ii) the Net Working Capital as of the Closing Date (the “ Estimated Net Working Capital ”), (iii) the aggregate amount of any capital expenditures not contemplated by the 2006 or 2007 capital expenditure budgets of the Partnership that may be made by the Partnership after the date of this Agreement and prior to the Closing in accordance with Section 6.1 (the “ Estimated CapEx Amount ”) and (iv) the aggregate amount of any principal and interest payments with respect to indebtedness of the Partnership that may be made by the Partnership after the date of this Agreement and prior to the Closing in accordance with Section 6.1 (the “ Estimated Debt Repayment Amount ”).

(b)                                  The Initial Purchase Price shall be (i) (A) increased, if the Estimated Net Working Capital exceeds the Reference Net Working Capital, by an amount equal to 49% of the amount of such excess, or (B) decreased, if the Reference Net Working Capital exceeds the Estimated Net Working Capital, by an amount equal to 49% of the amount of such excess, (ii) increased by an amount equal to 49% of any Estimated CapEx Amount and (iii) increased by an amount equal to 49% of any Estimated Debt Repayment Amount (the aggregate of such increase(s) or decrease, as the case may be, being the “ Estimated Closing Adjustment ”).

(c)                                   Within 45 days following the Closing Date, Seller shall prepare and deliver to Buyer, together with any supporting documentation, the following (collectively, the “ Preliminary Statement ”):

(i)                                      an unaudited balance sheet of the Partnership as of the Closing Date (before giving effect to the Closing) (the “ Preliminary Closing Balance Sheet ”), prepared by Seller in accordance with GAAP, consistently applied;

(ii)                                   a calculation by Seller of the aggregate amount of cash and cash equivalents (including money market funds) of the Partnership as of the Closing Date (before giving effect to the Closing) based on the Preliminary Closing Balance Sheet (the “ Preliminary Cash Amount ”);

(iii)                                a calculation by Seller of the Net Working Capital as of the Closing Date (before giving effect to the Closing) based on the Preliminary Closing Balance Sheet (the “ Preliminary Net Working Capital ”);

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(iv)                               a calculation by Seller of the aggregate amount of any capital expenditures not contemplated by the 2006 or 2007 capital expenditure budgets of the Partnership that may be made by the Partnership after the date of this Agreement and prior to the Closing in accordance with Section 6.1 (the “ Preliminary CapEx Amount ”); and

(v)                                  a calculation by Seller of the aggregate amount of any principal and interest payments with respect to indebtedness of the Partnership that may be made by the Partnership after the date of this Agreement and prior to the Closing in accordance with Section 6.1 (the “ Preliminary Debt Repayment Amount ”).

(d)                                  In connection with the preparation of the Preliminary Statement, Seller and its representatives shall have reasonable access, during normal business hours and upon reasonable notice, to the books and records, the financial systems and finance personnel and any other information of the Partnership that Seller reasonably requests, and Buyer shall, and shall use its commercially reasonable efforts to cause the Partnership, to cooperate reasonably with Seller and its representatives in connection therewith.

(e)                                   Buyer shall have fifteen (15) Business Days following receipt of the Preliminary Statement to review the Preliminary Closing Balance Sheet and the calculations of the Preliminary Cash Amount, the Preliminary Net Working Capital, the Preliminary CapEx Amount and the Preliminary Debt Repayment Amount, and to notify Seller in writing if it disputes the amount of the Preliminary Cash Amount, the Preliminary Net Working Capital, the Preliminary CapEx Amount or the Preliminary Debt Repayment Amount set forth on the Preliminary Statement (the “ Dispute Notice ”), specifying the reasons therefor in reasonable detail (and providing any supporting documentation).

(f)                                     In connection with Buyer’s review (and subject to the Confidentiality Agreement), Buyer and its Representatives shall have reasonable access, during normal business hours and upon reasonab