20160304Application.pdf

RECEIVED
2016 HAR -3 AH 9: l6
,ir jl I :,-j pUELIC
'; 11'1 ; ir. _;-;OilMlSSl0N
March 3,2016
(lu6sta? Gas Compsny
333 South State Street
PO Box 45003
salr Lske city, uT 84145-0003
Tel [phone] . Fax [phone]
Barrie. [e-mail]
Barric L. McKay
Vice President Rogulatory Affairs
Idaho Public Utilities Commission
Paul Kj ellander, Commissioner
Kristine Sasser Rapier, Commissioner
Eric Anderson, Commissioner
427 W. Washington
Boise, ID 83702
A{'b'lb'cl
RE: Notice of Agreement and Plan of Merger between Questar Corporation and Dominion
Resources, Inc.
Dear Commissioners:
Questar Gas Company (Questar Gas) and Dominion Resources,Inc. (Dominion)
respectfully submit this notice to the Idaho Public Utilities Commission (Commission) that
on January 31,2016, Questar Gas' parent, Questar Corporation, Dominion and Diamond
Beehive Corp. (a subsidiary of Dominion created solely for this transaction) entered into an
Agreement and Plan of Merger (Merger) by which Questar Corporation will become a
wholly-owned subsidiary of Dominion.
Pursuant to the applicable statutes, rules and regulations in Utah, Questar Gas and
Dominion have filed a Joint Notice and Application regarding the Merger with the Utah
Public Service Commission. We have enclosed, for your information and convenience, four
copies of the Joint Notice and Application, with its accompanying exhibits and testimony
which together provide greater detail about the Merger and the benefits that Questar Gas'
customers in Idaho, Utah and Wyoming will realize as a result ofthe Merger.
Pursuant to the applicable statutes, rules and regulations in Wyoming, Questar and
Dominion have filed a Joint Application for the approval of the Merger with the Wyoming
Public Service Commission as well. The Wyoming Joint Application, testimony and exhibits
are substantially similar to those filed in Utah.
Dominion is a strong and well-financed company that makes safety its highest
priority. It has made commitments that will be of substantial value to the customers,
employees, communities and states served by Questar Gas. Included are commitments that
will assure that Questar Gas (which will be known as Dominion Questar Gas) remains a
Utah-based company and that its operations will continue in the same manner. Dominion
Questar Gas will continue its tradition of providing safe and reliable service at reasonable
cost to its customers in Utah, Idaho and Wyoming. Regulation of Questar Gas will not be
affected by the Merger. Dominion will make available increased financial and managerial
resources to Dominion Questar Gas, and Dominion Questar Gas employees will receive the
benefit of increased funding of their pension and OPEB plans. Dominion is committed to the
environment and will maintain the environmental monitoring and maintenance progtams of
Dominion Questar Gas at or above current levels. Dominion will also increase charitable
contributions in the communities served by Dominion Questar Gas and will maintain or
increase historic levels of community involvement, Iow income funding, and economic
development efforts in Questar Corporation's operation areas.
If you have any questions or concerns, please contact me.
Sincerely, ,)
6a,'d//l%,
Barrie L. McKay J
Vice President Regulatory AffairslEnergy
Efficiency
Utah Public Service Commission (w/o enclosures)
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IN TIIE MATTER OF TI{E JOINT
NOTICE AND APPLICATION OF
QUESTARGAS COMPANYAND
DOMIMON RESOURCES, INC.
OF PROPOSED MERGBR OF
QTESTARCORPORATIONAND )
DOMIMON RESOURCES, INC. )
Docket No. l6-057-01
JOINTNOTICEAND
APPLICATION
All communications with respect to
these documents should be served upon:
Colleen Larkin Bell (5253)
Jenniffer Nelson Clark (7 9 47 )
Attorneys for the Applicant
333 South State Street
P.O. Box 45433
Salt Lake City, Utah 84145-0433
[phone]
Qsf 0-t b'ol
JOINT APPLICATION
AND
DGIIBITS
March 3,2016
Colleen Larkin Bell (5253)
Jenniffer Nelson Clark (7947)
Questar Corporation
333 South State Street
P.O. Box 45433
Salt Lake City, Utah 84145-0433
Phone: [phone]
Ernail : col [e-mail]
i e n rr i { lbr. c I ark(?g ue$laL'q o.Ul
Attorneys for Questar Gas Company
Mark O. Webb
Sharon L. Burr
Lisa S. Booth
Dominion Resourccs, Inc.
120 Tredegar Street
P.O. Box 26532
Riclrnrond, \zirginia 2326 I -6532
Phone: [phone]
Ernail : rnark.webb(Edom.com
sharon. l.burr(rrdottr.cortt
[sa. s. lroo t hr, giclonr. com
Brian W. Burnett (3772)
Callister Nebeker & McCuliough
10 East South Temple, Suite 900
Salt Lake City, Utah 84133
Phone: (80i) 530-7428
Emai I : bri 4n lrrlrngf t(t)ortnr [ay. ctlrn
Attorneys.for Dominion Resources, Inc.
in thc Matter of the Joint Notice and
Application of Questar Gas Company and
I)orninion Resources, Inc. of Proposed Merger
of Questar Corporation and Dorninior-r
Resources, lnc.
Gregory B. Monson (2294)
Cameron L. Sabin (9437)
Stoel Rives I.l-P
201 South Main Street, Suite I100
Salt Lake City, Lltah 84111
Phone: [phone]
Email : greg. rrttxrsonliljstoel. conr
cameron. sa bi n-Qst oc l. co m
Joseph K. Reid III
Bernard L McNarnee II
McGuireWoods
Gateway Plaza
800 East Canal Street
Richmond, Virginia 23219 -39 1 6
Phone: (9Aq775-1198
Ernail: i@
hnrcnartrceriiirn c gu i rc$,ood s. qo m
Docket No. 16-057-01
JOINT NOTICE AND APPLICATION
BEFORE THE PUBLIC SERVICE COMMISSION OF UTAH
Questar Gas Company ("Questar Gas" or the "Company") and Dominion Resources, Inc.
("Dominion") hereby provide notice to the Public Service Commission of Utah ("Commission")
of a proposed transaction whereby Questar Gas' palent, Questar Corporation, will become a
wholly-owned subsidiary of Dominion (the "Merger"). To the extent the Comrnission believes
approval of the Merger is required under Utah law, Questar Gas and Dominion hereby request an
order of the Commission authorizing the Merger.
In this Joint Notice and Application ("Joint Application"), Questar Gas and l)ominion
provide detailed information regarding the Merger and its benefits to the Company's customers
and the public in the state of Utah. Questar Gas and Dominion will cooperate in assuring that the
Cornrnission and interested parties are fully informed regarding the Melger. Accordingly, they
are providing testimony and exhibits in support of this .Ioint Application. In addition, to the
extent the Commission deems it necessary or useful, they will provide additional requested
information in technical conferences and in response to discovery requests and will, if deemcd
necessary, pafiicipate in a hearing to provide further infonnation and respond to questions of the
Commission and interested parlies.
In addition, Questar Gas requests the Commission to issue an accounting order
authorizing it to defer transition costs incurred in connection with the Merger, if it chooses to do
so, for later recovery if deemed appropriate by the Commission.
BACKGROUND
1. Questar Gas is a Utah corporation with its principal place of business at333 South
State Street, P.O. Box 45433, Salt Lake City, Utah 84145-0433. Questar Gas is a public utility
engaged in the distribution of natural gas to nearly one million customers in the states of Utah,
.',
Wyoming and Idaho. Its Utah and Idaho public utility activities are regulated by the
Commission,l and the Company's rates, charges, and general conditions fbr natural gas service
in Utah and Idaho are set forth in the Questar Gas Company Utah Natural Gas fariff PSCU 400
("Tariff').
2. Questar Gas is a wholly-owned subsidiary of Questar Corporation. Questar
Corporation, a Utah corporation, is a publicly-held holding company whose common stock is
traded on the New York Stock Exchange under the ticker STR. The other principal subsidiaries
of Questar Corporation are Questar Pipeline Company ("Questar Pipeline") and Wexpro
Company ("Wexpro").
3. Dominion is a Virginia corporation with its principal place of business at 120
Treclegar Street, P.O. Box 26532, Riclunond, Virginia 23261-6532. Dominion is a publicly-held
holding company whose common stock is traded on the New York Stock Exchange under the
ticker D. It has the following wholly-owned public utility subsidiaries: The East Ohio Gas
Company (which does business under the name "Dominion East Ohio"), Hope Gas, Inc. (which
does business under the name "Dominion Hope"). and Virginia Electric and Power Company
(which does business in Virginia under the name "Dominion Virginia Power" and in North
Carolina under the name "Dominion Norlh Carolina Power"). ln addition, Dominion owns other
sr.rbsidiaries in the energy industry, including a company with three solar power generation
projects in Utah, descriptions of which are providcd in rnore detaii below.
' The Company's service to custorners in Idaho is limited to Franklitr County. Under the
tenns of an agreement betwecn the Commission and the Idaho Public Utilities Cornmission, the
rates and terms of service for these idaho customers are detcrmined by the Utah Commissior-r.
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4.Diamond Beehive Corp. ("Beehive") is a Utah corporation and a wholly-owned
subsidiary of Dominion created solely to accomplish the Merger. Beehive is not a public utility
in Utah or elsewhere.
5. Questar Gas and Dominion request that notices and communications with respect
to this Joint Application be served upon the following:
Barrie L. McKay
Questar Gas Company
333 South State Street
P.O. Box 45433
Salt Lake City, Utah 84145-0433
barrie. [e-mail]
Mark O. Webb
Sharon L. Burr
Lisa S. Booth
Dominion Resources, Inc.
120 Tredegar Street
P.O. Box 26532
Rictunond, Virginia 23261 -6532
[e-mail]@
[e-mail]
Brian W. Burnett
Callister Nebeker & McCullough
10 East South Temple, Suite 900
Salt Lake City, Utah 84133
.brulu-b-urugl,&"qr:tllury.rc m
Colleen Larkin Bell
Jenniffer Nelson Clark
Questar Corporation
333 South State Street
P.O. Box 45433
Salt Lake City, Utah 84145-0433
col lecn. bel l@.q irestar.com
j cnni f lbr.cl ark(*.quqsta[.cqm
Joseph K. Reid III
Bemard L McNamee II
McGuireWoods
Gateway Plaza
800 East Canal Street
Riclnnond, Virginia 23219 -39 | 6
j rei d (0 rnc s uirewoods. com
hmcnarn [e-mail]
Gregory B. Monson
Cameron L. Sabin
Stoel Rives LLP
201 South Main Street, Suile 1 100
salt Lake city, utah 84111
gggg. mo trsoJr(qdfto e I . co m
garr tcro D.s irb.i n(iI st oel . co rn
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il. DIISCRIPTION OF THE MERGER
6. On January 31,2016, Dominion, Beehive and Questar Corporation entered into an
Agreement and Plan of Merger ("Merger Agreement") setting forth the tetms of the Merger. A
copy of the Merger Agreement is attached to this .Ioint Application as Exhibit 1.1 . The Merger,
which is explained in detail in the Merger Agreement, frzy be fairly summarized as follows:
a. Beehive and Questar Corporation will merge, with Questal Corporation
being the surviving entity (this surviving entity will be known as "Dominion Questar").
b. Tlie initial articles of incorporation of Beehive as frled on January 27 ,2016
are attached as Exhiblt 1.2 to this Joint Application. Section 1.5 of the Merger Agreernent
provides for the subsequent amendment of such articles as well as the articles of incorporation
and bylaws of Dominion Questar. Any such amendments will be filed with the Commission as
an update to Exhibit 1.2.
c. Immediately follor.ving the time the Merger is cffective as defined in the
Merger Agrecment ("Effective Time"), thc director of Dominion Questar will be the person that
was the director of Beehive immediately prior to the Effective Time, The name of the director of
Beehive is provided in Exhibit 1.3 to this JointApplication. Subsequentto the Elfective Tirne,
changes to the directors of Dorninion Questar may be made based upon integration effbrts and
Dominion's standard cntity rnanagemeut conventions.
d. Immediately following the Effective Time, the officers of Dominion
Questar will be those persons that wele the ofticers of Questar Corporation immediately prior to
the Effectivc Time. The narnes and positions of the officers of Questar Corporation are providcd
in Exhibit 1 .4 to this Joint Application. Subsequent to the Effective Time, we expect changes to
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the officers of Dominion Questar to be made based upon integration efforts and Dominion's
standard entity managelnent conventions.
7. As provided by the Merger Agreement, upon consurnmation of the Mergcr:
(i) each issued and outstanding share of common stock of Questar Corporation will be converted
into and wili thereafter represent solely the right to receive an arnount in cash, without interest;
and (ii) each issued and outstanding share of common stock of Beehive will be converted into
and become one validly issued, fully paid, and non-assessable sharc of common stock of
Dominion Questar. Thus, as a result of the Merger: (i) Dominion (which currently owns all the
stock of Beehive) will own all the stock of Dominion Questar; and (ii) the ownership of stock in
Dominion will not be impacted.
8. Under the terms of the Merger Agreement, each share of Questzu' Corporation's
corlmon stock will be converted into the right to receive $25.00 in cash, without interest and less
any applicable withholding taxes.
9. At the Effective Time, Questar Corporation will become Dorninion Questar, a
wholly-owned subsidiary of Dominion that will continue to exist as a separate legal entity.
10. After the Effective Time, Questar Gas will be known as Dominion Questar Gas,
will remain a direct, wholly-owncd subsidiary of Dominion Questar and will continue to exist as
a separate legal entity.
I 1. The resolution of the board of directors of Questar Corporation approving and
authorizing the Merger is Exhibit 1,5 to this Joint Application.
12. The resolution of the board of directors of Dominion approving and authorizing
the Merger is Exhibit 1.6 to this .ioint Application.
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ilI. FINANCIAL CONDITION OF QUESTAR GAS, QUESTAR
CORPORATION AND DOMINION
13. Questar Gas' assets as of December 31, 2015 totaled $2.2 billion; revenues in
2015 were $918 million; and net income in 2015 was $64 million. Questar Gas' capital structure
as of December 37,2015 was 46 percent long-term debt and 54 percent equity (stated under
generally accepted accounting principles ("GAAP")). Questar Gas' credit rating for its senior
unsecured debt is A2 (stable) with Moody's and A (negative) with Standard & Poor's ("S&P").
Questar Gas' 2015 financial statements are provided on pages 55-60 of the Questar Corporation
Annual Report on Form 10-K ("Questar 10-K"), Exhibit 1.7 to this Joint Application.
Additionally, Exhibit 1.8 is a copy of the2014 Gas Utility Arrnual Report previously filed with
the Commission. When the 2015 Gas Utility Annual Report is complete, Exhibit 1.8 will be
updated.
14. The authorized and outstanding securities issued by Questar Gas are dcscribed in
Note 8 to the Financial Statements of Questar Gas on pages 80-82 of the Questar 10-K, Exhibit
1.7 to this Joint Application.
15. During the rnost reccnt hve-year period, Questar Gas paid dividends to Questar
Corporation in the amounts shown in Exhibit 1.9 to this Joint Application. Dominion intends to
continue Questar Gas' practice of setting its dividend rates at levels thal substantively maintain
Questar Gas' current capital struoture.
16. Questar Corporation's assets as of December 31, 2015 totaled $4.4 billion;
revenues in 2015 were $1.1 billion; and net income in 2015 was $209 million. Questar
Corporation's capital structure as of December 31,20L5 was42 percent long-term debt and 58
percent equity (statcd under GAAP). Questar Corporation's issuer credit rating is A (negative)
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with S&P. Questar Corporation's 2015 financial statements are provided on pages 47-54 of the
Questar 10-K, Exhibit 1.7 to this Joint Application.
17. The authorized and outstanding securities issued by Questar Corporation are
described in Note 8 to the Financial Statements of Questar Corporation on pages 80-82 of the
Questar 10-K, Exhibit 1.7 to this Joint Application.
18. Questar Corporation's dividends to its shareholders during the most recent five-
year period are shown in Exhibit 1.9 to this Joint Application.
19. Dominion's assets as of December 31, 2015 totaled $58.8 billion; revenues in
2015 were $11.7 billion; and net income attributable to Dominion in 2015 was $1.9 billion.
Dominion's issuer credit rating is Baa2 (stable) with Moody's, BBB+ (stable) with Fitch and
BBB+ (stable) with S&P. Dominion's financial statements are provided on pages 58-81 of the
Dominion Annual Report on Form 10-K ("Dorninion l0-K"), Exhibit 1.10 to this Joint
Application.
20. Dominion's capital structure as of December 31,2075 was 60,6 percent debt and
39.4 percent equity as calculated per Dominion's revolving credit agreement covenant, which in
Dominion's view presents the most accurate picture of Dominion's capitalization as it takes into
account the equity value of Dorninion's equity-linked securities. Given Dominion's plan for the
permanent financing of this transaction, that capital structure should not be materially impacted
by the proposed Merger. After the Merger, Dominion expects to remain in compliance with its
existing covenant by rnaintaining debt levels less than 65 percent of the total capital structure
per the covenant rnethodology and will continue to maintain a financing mix which supports
strong investment grade credit ratings. F'or reference based on the most reccnt audited financial
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statements (stated under GAAP) and prior to any adjustments, Dominion's capital structure at
December 31,2015 was 68.4 percent debt and 31.6 percent equity.
21. The authorized and outstanding securities issued by Dominion are described in
Notes 16-19 (pages 125-136) to the Financial Statements of Dominion in the Dorninion 10-K,
Exhibit 1.10 to this Joint Application.
22. During the most recent five-year period, Dominion has been paying dividends to
its shareholders in the amounts shown in Exhibit 1.1 1 to this .loint Application. 1'herc is no plan
to change Dominion's dividend policy as a result of the Mcrger.
23. On a consolidated basis (Questar Corporation and Dominion) as of December 3 1,
2015, Dorninion's pro forma combined assets would be approximately fi66.2 biilion and pro
forma combined revenues would be $12.8 billion. Pro forma consolidated financial statements
are provided as Exhibit 1.12 to this Joint Application.
24. Dominion's stable regulated operations, strong access to capital markets, ample
liquidity, prudent capital structure, and cxperienced leadership team all contribute to its strong
investment grade ratings. After announcement of the Merger, Moody's affirmed the existing
long-term and shorl-tenn ratings and stable outlook for Dorninion, and Fitch also affinned the
existing long-term and short-tetm ratings and stable outlook. S&P, rvhich had rated Dominion
onc notch higher than Moody's, and Fitch, which since November 2014, had the Dominion
farnily on a negative outlook, dorvngraded the credit rating of the Dominion family by one notch
to BBB+ and revised their outlook to stable. Copies of the relevant portions of these credit
reports are provided in Exhibit 1.13 to this .loint Application.
25. After announcement of the Merger, Moody's affirmed the existing long-term
rating of A2 (stable) for Questar Gas. S&P also affirmed Questar Gas' rating of A, but changed
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the outlook to CreditWatch Negative which indicates the potential for a lower credit rating upon
close of the proposed Merger. Copies of the relevant portions of these credit repods are
provided in Exhibit 1.14 to this Joint Application. S&P's action is due to its use of a group
rating methodology, where all core subsidiaries of a parent company receive the same corporate
rating as the parent. It is cornmon for S&P to take such action following an acquisition cven
though the credit profile of the surviving subsidiary has not materially changed. Dominion and
Questar Corporation expect that S&P will maintain Questar Gas' existing Stand-Alone Credit
Profile rating of ("a"). S&P's Stand-Alone Credit Profile rating is an indicator of the issuer's
creditrvorthiness absent any consideration of a parent or holding company and is an important
factor that debt capital market investors consider in determining potential debt finanoing terms.
IV. METHOD FOR FINANCING THE MERGER
26. Dominion has executed bridge and term loan acquisition financing agreements
with a broad syndicate of leading financial institutions that, combined with Dominion's existing
credit facility availability, provide immediate access to cumulative funds of up to $4.4 billion,
sufficient to satisfli 100 percent of thc amount required to fund the exchange of the shares of
Questar Corporation fbr cash. As is customary for a transaction of this type, Dominion plans to
use proceeds from permanent financings, some of which may occur prior to the Efl'ective Time,
to preclude the need for or replace any funds borrowed under these existing credit facility. bridge
and tenn loan agreements.
27. Dominion's permanent financing plan is designed to support its cxisting credit
ratings and consists of the issuance of equity, equity-linkcd securities (i.e., securities that convert
to common equity in thc future), and dcbt, at both Dominion and Dominion Midstrearn Partners,
o
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L.P. ("Dominion Midstrcam"), 2 a subsidiary of Dominion that provides incremental access to
capital markets. After the Effective Time and subject to negotiation with Dominion Midstream,
Dominion expects to contribute all or parl of Questar Pipeline to Dominion Midstream in a
transaction that will have no impact on the operations, services provided, or rates of Questar
Pipeline.
28. As part of the Merger, Questar Corporation and Questar Corporation's
subsidiaries'existing indebtedness, which, as of Deoember 31,2015, totaled $1.7 billion, will
remain outstanding at Questar Corporation, Questar Gas and Questar Pipeline, respectively, all
of which will become direct or indirect subsidiaries of Dominion. Dominion will provide
liquidity to Dorninion Questar Gas for seasonal working capital required in a ma:rner consistent
with Questar Corporation's past practice.
V. PLAN FOR OPERATING DOMINION QUESTAR GAS
29. Following the Merger, Dominion and Dorninion Questar plan to operate
Dominion Questar Gas in the same rnanner as it is operated today. Dominion's gas utility
subsidiarics, like Questar Gas, havc a track record for makir-rg capital investments required to
provide safe and reliable service to cr-rstomers. Safety in thc workplace and in the community is
Dominion's highest priority. Dominion also shares Questar Gas' dedication to customer service,
a fact attested to by both organizations' customcr satisfaction ratings. Dominion and Questar
Gas also share a history of operating wilh intcgrity and a firn conrmitment to theil ernployees
and the cornmunities they serve.
2 Dominion Midstream is a master linrited partnership formed by Dominionin20l4.
Dominion Midstrearn invests in a growing porlfolio of natural gas terminaling, processing,
storage, transportation and related assets. Dominion owns 100 percent of the generalpartner and
64.1 percent of the limited paftner interests in Dominion Midstream,
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30. Following the Merger, Dominion Questar Gas will continue to receive certain
shared or common services provided to it as part of a iarger organization. These services have
been provided by Questar Corporation. The curent organizalional structure of Questar
Corporation is provided in Exhibit 1.1 5, page 1, to this Joint Application.
31. Questal Co4roration cur'rently employs 347 individuals, All of these employecs
perform shared or colnmon services functions for all Questar Corporalion business units,
including Questar Gas. Some of these services (including investor reiations, governance,
finance, treasury, tax, accounting. legal, information technology, telccornmunications.
insurance, purchasing, contracting, environmental rnanagement, safety, audit, and human
resources) will be provided in the future through Dorrinion Resources Services, Inc. ("Dominion
Services") rather than Questar Corporation by current Dominion Services employees or by
curent employees of Questar Corporation who move nnder Dominion Services after the Merger.
Given economies of scale and Dorninion's greatcr buying power, Questar Gas and Dominion
anticipate that these changes may result in lower costs to Dominion Questar Gas for these
services over time, However, thc Joint Applicants have not yet determined the synergies that
lvill result rvhen thcse shared services are combined. The Joint Applicants will provide periodic
status reports related to the combining of these services, beginning May 1 , 2016. Dominion
Questar Gas will refleot any resuiting benefits to customcrs in its future general rate cases.
32. Altliough there is no plan to materially change the opcrations of Dominion
Questar Gas fbllowing thc Mergcr, Dominion Questar Gas may rnake appropriatc future
rnodifications to its asscts, systems, procedures and sen ices in compliance with applicable laws
and regulations. Such changes may be made in the nomral course of business in order to adopt
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new methods, materials or technology; to meet regulatory requirernents; or to address changing
customer expectations.
33. The cnnent organizational structure of Questar Gas is provided in Exhibit 1.15,
page 2, to this Joint Application. Dominion has no plan to change the organizational structure of
Dominion Questar Gas operations as a result of the Merger. In the event Dominion and Questar
Gas dctermine that a change in operational organi zational structure will be beneficial to
customers, Exhibit I .15 will be updated.
34. Questar Gas is cunently owned by Questar Corporation. Dominion Questar Gas
will be a direct, wholly-owned subsidiary of Dominion Questar, fbnnerly known as Questar
Corporation, following the Merger.
35. Dominion has no plan to change the Utah operations of Dominion Questar Gas as
a result of the Merger. A current organizational chart for the Utah operations of Questar Gas is
attached as Exhibit 1.16 to this Joint Application. In the event Dorninion and Questar Gas
determine that a change in the operational structure will be benel'rcial to customers, Exhibit 1.16
will be updated.
36. F'or regulatory pulposes, Qucstar Gas' accounting will continue to rellect assets at
historical costs, approved depreciation rates and deferred income taxes based on original cost in
accordance with tire Unifonn Systern of Accounts.
37. Questar Gas' Tariff is currently active and on file with the Comrnission. No
changes rvill be made to Questar Gas' existing filcd rates, rules, regulations and classifications
under its exisling 'l'arilT as a result of the Merger. Dominion Questar Gas rvill file a revised
Tariff following the Merger that changes only the name of tlie operating entity. To the extent
necessary, changes to the Tariff will be madc in the ordinary course.
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38. All financial books and records of Dominion Questar Gas will be kept in Salt
Lake City, Utah, and will continue to be available to the Commission, upon request, at Dominion
Questar Gas' offices in Salt Lake City in accordance with current practice.
39. Dominion plans to maintain Questar Gas' existing proportions of debt and equity
capital.
40. Joint Application Exhibit 1.17 contains charts showing the organization of
Dominion prior to (pages 1-2) and after (pages 3-5) the Merger.
41. Questar Gas and Dominion share a common focus on installing, upgrading and
maintaining facilities necessary f,or safe operations. This focus will not be diminished in any
way as a result of the Merger. Dominion anticipates that the Merger wili not change Questar
Gas' plans for capital expenditures over the next five years. Questar Gas' current plan for capital
expenditures over the next five years is shown in Exhibit 1.18 to this Joint Application. These
plans will be updated over time to reflect custorner growth and the requirements to provide safe
and reliable service while minimizing costs to customers.
42. As the foregoing demonstrates, Questar Gas' customers, communities and
regulators will see benefits from the ownership of Dominion Questar Gas by Dominion, an entity
with greater financial strength and buying power, broader expertise in utility operations and
business planning, and a shared focus on safety, reliability, customer service and efficiency of
business operations over the long term.
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VI. DOMINION'S IDENTITY, MANAGEMENT AND EXPERIENCE IN THE
ENERGY INDUSTRY
A. Identify
43. Dominion, headquarlered in Richmond, Virginia, is one of the nation's largest
energy inlrastructure companies. As of December 31, 2015, Dominion had a public equity
market capitalization of over $40 billion. Dominion is a member of leading general and
industry-specific equity market indices including the S&P 500, the I)ow Jones Cornposite
Average, and the Philadelphia Stock Exchange Utility Index. Dominion's operations are heavily
weighted to state and federally regulated energy infrastructure operations. As of December 31,
2015, Dominion's porlfolio of assets includes approximately 24)0A MW of electric generatirrg
capacity, 6,500 miles of electric transmission lines, 57,300 miles of electric distribution lines,
12,200 miles of natural gas transmission, gathering and storage pipelines and ovcr 22,000 miles
of gas distribution pipelines, exclusive of service lines. As of Decernber 31,2015, Dominion
serves ovcr five million utility and retail energy customers in 14 states and operates one of the
nation's largest underground natural gas storage systems, with approxirnately 933 billion cubic
feet ("Bcf ') of storage capacity. Dominion has approximately 14,700 full-time employccs. As a
holding conrparly, Dorninion owns direct and indirect subsidiaries which in turn own the
properties thtough which their respective businesses are conducted.
44. Although the assets of its subsidiaries remain ',vholiy rvithin its legal subsidiaries
(each of which has its own officers, directors and management teams), Dominion rnanages and
rcports on its consolidated operations through thlee primary opcrating segments: Dorninion
Virginia Power ("DVP"), Dominion Generation and Dominion Energy. The DVP opcrating
segment includes Dominion's electric transmission and distribution operations, and the
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Dominion Generation operating segment includes Dominion's regulated and merchant electric
generating fleet. 'Ihe Dominion Errergy operating segment, the segment through which the
operations of Dominion Questar and its subsidiaries r.vill be reporled, currently includes the gas
transmission and storage and gas gathering operations of Dorninion Transmission, Inc., including
producer service activities, as well as the gas distribution and storage services of The East Ohio
Company and Hope Gas, Inc. The common leadership and management of the similarly situated
businesses that comprise Dominion's operating segments provide significant value to each of the
individual businesses through the sharing of best practices in such arcas as operations, safety,
customer service and environmental ster,vardship. ln this way, each of Dominion's regulated gas
subsidiaries benefits from the experience and knowledge of the collective group. in addition to
its operating subsidiaries, Dominion has a centralized service company, Dominion Services.
Support ftlnctions housed at Dominion Services also provide significant benefits in arcas such as
environmental compliance and cyber security. as well as ploviding other centralized departments
whose resorlrces are available to all of the subsidiaries of Dominion.
45. Dominion's major regulated electric and natural gas subsidiaries are as follows:
The East Ohio Gas Company ("Dominion East Ohio") is a natural gas
distribution cornpany serving approximately 1.2 rnillion retail customers in rnorc than 400
eastern and westem Ohio communities, including the cities of Cleveland, Akron, Canton,
Youngstown, Marietta and Lima, Dominion East Ohio operates 19,632 miles ol'distribution
lines,994 miles of transmissiorr and storage lines.758 miles ofjurisdictional gatherirrg lines and
171 Bcf of underground storagc capacity. In 2015 its natural gas throughput was 468.3 Bcf. it is
regulated by the Public Utilities Cornmission of Ohio.
-16-
b. Hope Gas, Inc. ('(Dominion Hope") is a natural gas distribution company
serving approximately 112,000 retail customers in West Virginia, including the cities of
Clarksburg, Parkersburg and Morgantown. Dorninion Hope operates 3,146 miles of distribution
lines. In 2015 its natural gas throughput was 29.0 Bcf. It is regulated by the West Virginia
Public Service Commission.
c. Donninion Transmission, Inc. ("Dominion Transmission") is a natural
gas pipeline company operating 7,600 miles of interstate gas transmission, gathering and storage
pipelines in six states (Ohio, West Virginia, Pennsylvania, New York, Maryland and Virginia)
and operating one of the largest undcrground natural gas storage systems in the United States
r.vith approximately 762 Bcf of storage capacity. Dorninion Transmission has multiple links to
other major natural gas pipelines and to markets in the Midwest, Mid-Atlantic and Northeast
regions of the United States. It is regulated by the Federal Energy Regulatory Commission
("FERC"),3
d. Dominion Cove Point LNG LP ("Dominion Cove Point") operates a
FERC-regulated liquefied natural gas impoft, storage and shipping terminal on the Chesapeake
Bay in southeastern Maryland with a stolage capacity of i4.6 Bcf. Dominion Cove Point
providcs natural gas transportation with links to the major pipeline systems of Transco,
Columbia Gas Transmissiona and Dominion Transmission. Dominion completed an expansion
project in 2009 that increased the facility's storage and vaporization capacity by 80 percent and
3 Dominion East Ohio, Dominion Hope and Dominion Transmission all became part of
the Dominion family of companies through Dominion's acquisition of Consolidated Natural Gas
in 2000. l)ominion Gas Holdings, LLC ("Dominion Gas"), a limited liability company and
holding company, serves as the intermediatc parent company for Dominion East Ohio and
Dominion'i'ransrnission and for a24.72 percent stake in Iroquois that is described below.
4 Tronr"ortinental Gas Pipe Line Company, LLC ("'['ransco") is owred by Williams
Partners, L.P.; Columbia Gas Transmission. LLC is owned by Columbia Pipeline Group, Inc.
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\n 2014 began construction of a $3.4-3.8 billion expansion designed to liquefy and export
domestically-produced natural gas from the facility, thereby making it a bi-directional terminal.
Dominion Cove Point also provides firm peaking services to local distribution companies in the
Mid-Atlantic region.5
e. Dominion Carolina Gas Transmission, LLC ("Dominion Carolina
Gas"), a natural gas pipeline company, operates approximately 1,500 miles of interstate gas
transmission pipelines in South Carolina and Georgia serving wholesale and direct industrial
customers throughout South Carolina. Dominion Carolina Gas is regulated by FERC and was
acquired by Dominion in 2015.6
Iroquois Gas Transmission System L.P. (o'Iroquois"), a limited
partnership of three U.S. and Canadian energy companies, operates 416 miles of interstate
transmission pipelines in Connecticut and New York and is regulated by FERC. Dorninion
currently holds a total of 50.65 percent of the ownership interests in Iroquois, which began
operations in 1992.7
g. Virginia Electric and Power Company ("Virginia Power"),
headquartered in Richmond, Vilginia and incorporated in Virginia in 1909 as a public service
corporation, is a regulated public utility that generates, transmits and distributes electricity for
sale in Virginia and North Carolina to approxirnately 2.5 million customer accounts. Virginia
Power is regulated in Virginia by the Virginia State Corporation Commission and in North
Carolina by the North Carolina Utilities Commission. Virginia Power operates approximately
5 Dominion's gcncral partner and prefered equity interests in Dominion Cove Point and
Dominion Carolina Gas, as well as 25.93 percent ownership of lroquois, are held by Dominion
Midstream.
6 lbtd.
' Ibtd.
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18,450 MW of electric generation facilities,6,500 miles of electric transmission lines and 57,300
miles of electric distribution lines. Virginia Power's electric transmission operations and its
sales for resale of electric power in interstate commerce are regulated by FERC.
B. Experience in the Energy Industry
46, Dominion's regulated utilities share the same values as Qnestar Gas, including a
focus on custorner satisfaction, safcty, a comrnitment to employees and the communities served
and integrity in all aspects of their businesses.
41. Dominion's experiencc in owning and operating its public utility subsidiaries
means that it comes to the Merger rvith a deep understanding of the responsibilities and general
opportunities and challenges of cunent U.S. natural gas utilities and with directly applicable
experience and knowledge about sonre of the specific opportunities and challenges now faced by
Questar Gas. Through its other subsidiaries, Dominion also has significant experience in the gas
transmission and storage industries ald in all aspects of the electric industry.
48. Dominion understands and has extensive experience operating local natural gas
distribution public service companies. Dominion cunently operates two local distribution
companies, Dominion East Ohio in Ohio and Dominion Hope in West Virginia. Together,
Dominion East Ohio and Dominion Hope serve approximately 1.3 million residential,
comrnercial and industrial custorners lluough over 22,000 miles of gas distribution pipelines.
49. Dominion is also one of the nation's largest tlanspofters of natural gas, with
12,200 miles of natural gas transmission, gathering and storage pipelines. Dorninion operates
one of the nation's largest natural gas storage systems with approximately 933 Bcf of storage
capacity.
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50. As mentioncd previously, on a consolidated basis, Dominion manages and reporls
its natulal gas transmission, distribution and storage businesses through its Dominion Energy
operating segmcnt. This approach allows Dominion to leverage knowledgc and expertise and
share best practices among the separate gas subsidiaries for the benefit of customers.
51. Dorninion recognizes that the energy business, whether natural gas or electric,
requircs capital investment to ensure safe and reliable service to customers. Dominion is
engaged in a $19 billion investment initiative in its gas arrd electric infrastructure-thc largest
electric and natural gas infrastructurc build-out in its history. Beginning in 2008, Dorninion East
Ohio launched a major Pipeline Infrastructure Replacement Program-aZl-year plan to replace
about 5,500 rniles of aging pipeline serving its Ohio customers. Similarly, Dominion Hope has
recently implernented a Pipeiine Replacement and Expansion Program in West Virginia which is
designed to replace 1,043 miles of natural gas infiastructure over 50 years. Both of these
programs will help rnaintain safb and reliable delivery of gas service to customers.
52. Dominion is fully dedicated to meeting customers' energy needs in a manner
consistent with protecting the environment and supporting sustainability. In addition to
complying with all applicable environmental laws and regulations, Dominion makes
environmental concerns an integral parl of its plarining and decision-making process and devotes
substantial resouroes to implement ef}'ective environmental and sustainability programs. From
2008 to 2014, Dominion's total equivalent carbon dioxidc emissions, which include carbon
dioxide, methane and nitrous oxides, have been reduced by approximately 37 percent. During
that same period Dorninion's carbon intensity rate- -carbon emissions per unit of electric output
frorn its generating f'lcet--declincd by 28 percent, Of special emphasis in the natural gas
business are methanc emissions, Dominion has developed a comprehensive program for
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management of methane emissions tluough measurement, mitigation and disclosure. Dominion
Transmission has been voluntarily participating in the EPA's Natural Gas STAR program for
rnore than four years, Dominion Transmission's methane reduction program has rcsulted in
more than 1.5 Bcf of methane ernissions reductions since 2008 and continues to incorporate cost-
effective best practiccs in engineering design to reduce methane emissions fi'om new projects.
Dominion East Ohio and Dominion I{ope began participation in the Natural Gas STAR Program
in2014 and 2015, respectively.
53. Safety is another top priority for Dominion. From 2010-2015, there has been a
31.5 percent decline in OSI-IA recordable incidents and a 20.8 percent decline in lost
daylrestricted duty cases. For 2015, in about 30 million hours worked, Dominion crnployees
recorded 110 workplace OSHA-recordable injuries (an incidence rate of 0.74) and 56 workplace
injuries resulting in lost days or reassignment of duties (a rate of 0.38). Dominion's ultimate
goal is zero injuries.
54. Customers of regulated natural gas utilities expect safe, reliable and quality
service. When service dismptions occur, the service teams at Dominion East Ohio and at
Dominion IIope respond to customers' outage-rclated service requests as quickly and satbly as
possiblc. In 2015, Dorninion East Ohio responded to 98.4 percent of all emergency calls within
60 rninutes, and Dominion Hope responded within 60 minulcs to 95.7 percent of all such calls.
Dorninion's local gas distribution companies have rnade significant investments in conseryatiorr
and energy efficiency programs fbr the benefit of their customels.
55. Dominion recoguizes that its natural gas and electric distribution companies are
more than just public utilities, they are public service companies. Dorninion bclicves that it is
important that the local utility also be a contributor to, and be part of, the conrmunity it scrvcs.
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In 2015, Dominion and its philanthropic arm, the Dominion Foundation, awarded more than $25
rnillion in charitable grants to about 1,200 nonprofit organizations in the states served by
Dominion companies, and Dominion ernployees donated more than 110,000 hours of voiunteer
service to their communities.
56. Supporting the men and women who have wom a U.S. rnilitary uniform in service
to their country is also an important priority for Dominion. From 2010-2015, Dominion hired
more than 74A ve@rans-almost 20 percent of new hires during that period. Approximately
1,600 Dominion employees are veterans, about 10 percent of the workforce. In 2015 Dominion
hired 191 military veterans through its "Troops to Energy Jobs" program--2.0 percent of all new
hircs-to support their transition to civilian careers and address Dominion's need for skilled and
disciplined workers.
C. Background of Key Personnel
57. Dominion has a wealth of managerial experience. 'fhe chairman and principal
officers of Dominion are as follows:
Thomas F. Farrell, II is chairman, president and chief executive officer
("CEO") of Dominion. Mr. Farrell joined Dominion in 1995, and has served as an officer of
Dominion and many of its subsidiaries. He was executive vice president of Dominion frorn 1999
to 2003 and president and chief oper:ating oflicer fi'om January 2004 to Deoernber 2005. In
Janttary 2006, Mr. Farell was named president and CEO of Dorninion and was eiected chaimran
of Doniinion's board in April 2007.
b. Mark F. McGettrick is executive vice president and chief financial
officer of Dominion. Mr. McGettrick joined Dorninion in 1980 and has held a variety of
management positions in Distribution Design, Accounting, Financial Planning, Customer Service
'\.1
and Generation. He previously servcd as president of Dominion Rcsources Services, Inc, and
was chief executive officer of the Dominion Gcneration operating segment bclore assuming his
curent post in June 2009.
c. David A. Christian is chief executive offrcer of Dominion's Enelgy
Infrastructure Croup, responsible for the DVP and Dominion Encrgy business units, and CEO-
DVP. Mr. Christian joined Virginia Power in 1976 and has held a variety of rnanagement
positions with Dominion. Before being named CEO-Dominion Gcneration in June 2009, Mr.
Cliristian was chief nuclear officer of the Dominion Nuclear business unit. He assumed his
ourrent post in January 2016.
d. Paul D. Koonce is CEo-Dominion Generation. He ovelsees more than
24,300 MW of regulated and merchant generation operations. Mr. Koonce, who lias more than
30 years' experience in the energy rnarketplace) \ ,as CEO-Dominion's Energy Infrastructure
Group and president-Dominion Virginia Power. Previously, he held managcmcnt positions as
CEO-DVP and CEO-Dominion Energy. IIe assumed his current post in January 2016.
e. Carter M. Reid is senior vice president, chief adrninistrative and
compliance offlcer and corporate secretary at Dominion. Ms. Rcid joined Dominior-r as assistant
general counsel in.Ianuary 1996 and was named rnanaging counsel in 2000. Shc bccarne
clirector-Executive Compensation in July 2003 and vice president-(iovernance and corporate
secretary in Octobcr 2007. She was named vice president, general cottnsel, chief compliance
officer and corporate secretary in .Ianuary 201I and became senior vicc president-Administrative
Services and corporate secretary in.lanuary 2A13. N4s. Rcid bccame senior vice president-
Administrative Services, chief compliance ollicer and corporatc secretary in July 2013 and
assumed her current post in.Ianuary 2014.
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Robert M. Blue is senior vice president-Regulation, Law, Energy
Solutions & Policy and president-Dorninion Virginia Power, Mr. Blue joined Dominion in 2005
as managing director-State Affairs & Corporate Public Policy, and was later promoted to vice
president-Stale & Federal Affails. I-Ie was named senior vice president-Publio Policy &
Corporate Cornmunications in May 2008 and became senior vice president-Public Policy &
Envirorunent in February 2A10. He was nanred senior vice president-Law, Public Policy &
Environment in January 2011 and president of Dorninion Virginia Power in January 2014. Mr.
Blue was named senior vice president-Regulation, Law, Energy Solutions & Policy in May 2015
and assumed his current post in.Ianuary 2016.
g. Diane Leopold is president-Dorninion Energy. Since.f oining Dominion in
1995, Ms. Leopold has held various operational, project management, commercial and financial
management roles in several business units. Recent positions include senior rrice president-
Business Development 8L Generation Constmction and senior vice president-I)orninion
Transmission, She assumed her cunent post in January 2014.
h. Fred G. Wood, III is senior vice president-Financial Management,
Energy lnfrastructure Group. Since joining Dominion in 1985, Mr. Wood has held various
financial positions. Mr. Wood served as vice president, treasurel and chief financial officer of
Dominion Energy from 1998 to 2000, and as senior vice president-Financial Managemcnt,
Donrinion Exploration & Production fronr 2000 to 2004 and senior vice president-Financial
Management, Dominion Generation tiorn 2004 through2013. He assumed his cunent post in
January 2014.
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VII. COMMITMENTS AND BENEFITS
58. The Merger is in the public interest and will provide benefits to Questar Gas
customers and to Utah. Questar Gas' rnanagcment was fully involved in evaluating the Merger.
Management considered the impact of the Merger on Questal Gas' customers, employecs and
communities and determined that the Merger was in their best interests. Dominion plans to
operate Dominion Questar Gas in the same way as it is currently being operated and intends the
Merger to be about growth, rather thau cost reduction. Dominion plans to utilize Questar
Corporation as its Westem Region hub to supply the expanding needs for gas and electric energy
infrastructure in the westem United States. The Commission will continue to exercise its
regulatory authority over Dominion Questar Gas in the sanre way it does today, thereby ensuring
continued protection of the intercsts of lJtah custorners. Questar Cas and Dominion will adopt
the following commitments and have the fbllowing understandings:
Business
a. Dorninion will maintain Dominion Questal Gas' cotporate headquafters in
Salt Lake City, Utah.
b. Dominion will establish a new Westem Region operating headquafters in
Salt Lake City, Utah.
c. Dominion intends that its board of directors will take all necessary action,
as sool1 as practical after the Effcctivc Time, to appoint a mutually agreeable cunent mernber of
the Questar Corporation board as a director to serve on Dominion's board of directors.
d. Dominion will take all necessary action to cause a mutually agreeable
cuuent member of the Questar Corporation board to be appointed as a director to serve on the
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board of directors of the general partner of Dominion Midstream at such tirne as all or part of
Questar Pipeline is contributed to Domirrion Midstream.
e. Dorninion Questar Cas willbe managcd fi'om an operations standpoint as a
separate regional business under Dorninion with responsibility for rnaking decisions that achieve
the objectives of customer satisfaction, reliable service, customer, public and employee safety,
environmental stewardship, and collaborative and productive relationships with customers,
regulators, other govemmental entities and interested stakeholders.
f. Dorninion intends to maintain Dorninion Questar Gas' customer service at
or better than curent levels and will strive for continued improvements thereto.
g, Questar Gas and Dominion share a common lbcus on installing, upgrading
and maintaining facilities necessary for safe and reliable operations. This focus will not be
diminished in any way as a result of the Merger.
h. Dorninion is cornmitted to the environment and will mairrtain the
environmental monitoring and maintenance programs of Dorninion Questar Gas at or above
current levels.
i, Dominion and its subsidiaries will continue to honor the Wexpro
Stipulation and Agrecment, the Wexpro Il Agreement or the conditions approved in connection
with inclusion of properties in the Wexpro II Agreement ("Wexpro Agrecmcnts") and the
conditions and obligations provided therein. Dominion r,vill not contribute Wexpro to Dominion
Midstream or to any master lirnited partnership without Commission approval.
Iinrq krycc..[I attcr.s
j Dominion will give employees of Dorninion Questar and its subsidialies
due and fair consideration for other employment and promotion opportunitics within the larger
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Dominion organization, both inside and outside of Utah, to the extent any such employment
positions are re-aligned, reduced or eliminated in the future as a result of the Merger.
k. Dominion will use commercially reasonable efforts (subject to changes tn
interest rates or other actuarial factors and the plans' investment performance) to provide up to
$75,000,000 toward the full funding of (i) Questar Corporation's ERlSA-qualified defined-
benefit pension plan in accordance with ERISA minimum funding requirements for ongoing
plans, and (ii) Questar Corporation's nonqualified defined-benefit pension and postretirement
medical and life insurance (other post employment benefit ("OPEB")) plans on a financial
accounting basis, in each case by the end of the first fiscal year commencing on or after the
Effective Time, subject to any maximum contribution levels or other restrictions under
applicable law.
Rcgulaton,
l. Officers and employees of Dominion will be available to testify before
Commission, providing information relevant to matters within the jurisdiction of
Commission upon the request of the Comrnission.
m. As part of this and future regulatory proceedings, Dominion Questar Gas
will provide information about Dominion or its other subsidiaries relevant to matters within the
Commission's jurisdiction to the Commission upon request of the Commission.
n. Dominion Questal Gas will maintain a complete set of books and records,
including accounting records, for Dorninion Questar Gas at its corporate office in Salt Lake City,
Utah.
the
the
.\,1-Lt-
o. For regulatory purposes, Questar Gas' accounting will continue to reflect
assets at historical costs, approved depreciation rates and deferred income taxes based on original
cost ir-r accordance with the Uniform System of Accounts.
p. The i\4erger will not result in any changes to Questar Gas' existing filed
rates, rules, regulations and classifications under its existing Tariff on file u,ith the Commission,
except to revise the Tariff to change the name of the operating entity.
q. Dominion Questar Gas will maintain the billing requirements as described
in Tariff.
r. Dorninion Questar Gas will continue to follow the Commission's
Integrated Resource Plan process and guidelines.
s. Dominion Questar Gas will rnaintain established gas-supply
interchangeability Wobbe indices for Questar Gas' receipt points in compliance with
Comrni ssion requi rements.
t. Goods and services provided to Dominion Questar Gas by Dominion or its
other subsidiaries will be provided at prices either (i) subject to regulation by regulators with
iurisdiction over those subsidiaries or (ii) at the lower of cost or market. This commitrnent does
not apply to goods or services provided to Dominion Questar Gas by Wexpro, which shall be
provided pursuant to the terms of the Wexpro Agreements.
u. Dominion Questar Gas will not seek recovery of any acquisitiorr prernium
(goodwill) cost or transaction costs associated with the Mergcr from its customers. Dominior-r
will not record any portion of the cost to acquire or any goodwill associated with the Merger on
Dominion Questar Gas' books and is planning to make the required accounting entries associatcd
with the Merger on that basis.
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v. Dominion Questar Gas may defer transition costs associated with the
Mcrger and will only seek recovery of such transition costs to the extent that it can demonstrate
that such costs result in a net benefit to customers.
Financial
w. Dominion, through Dominion Questar, will provide equity, as necded, to
Dominion Questar Gas with the intent to maintain Questar Gas' current capital structure.
x. Dominion intends to maintain credit metrics that are supportive of strong
investment-grade credit ratings for Dominion Questar Gas.
y. Neither Dorninion nor its other subsidiaries will, without Commission
approval, rnake loans to Dominion Questar Gas that bear interest at rates that are greater than
(i) rates being paid at the lirne of such loan by I)ominion or such other subsidiary on its own debt
or (ii) rates available, at the tirne of such loan, on similar loans to Dominion Questar Gas from
the nrarket.
Dominion Questar Gas will only lend funds to Dominion in accordance
provides short-term funds towith the current practice of Questar Gas whereby it occasionally
Questar Corporatiorl as seasonal working capital needs fluctuate.
aa. Dominion Questar Gas will not transfer material assets to or assume
liabilities of Dominioll or ally other subsidiary of Dominion without Commission approval.
bb. Dominion Questar Gas will not transfer its debt to Domir.rion without
Commission approval.
(,lonrntunity
cc. Dominion will incrcase Questar Corporation's historic level of corporate
contributions to charities identified by local leadership that are within Dominion Questar Gas'
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seryice areas by $1,000,000 per year for at least five years and maintain or increase historic
levels of community involvement, low income funding, and economic development efforls in
Dominion Questar's current operation areas.
dd. Dominion will establish a newly-formed advisory board for its Western
Region operations composed of regional-based business and community leaders. This Board
will meet several times each year to receive information and provide feedback on community
issues, govemment relations, environmental stewardship, economic development opportunities
and other related activities that affect Dominion's and Questar Gas' local stakeholders, with such
advisory board to include the current regional-based members of Questar Corporation's Board.
59. Dominion brings the following additional benefits to Questar Gas and its
customers through the Merger:
a. The operations of the utility subsidiaries of Dominion provide
demonstrable evidence that Dominion Questar Gas will continue its emphasis on key utility
performance areas such as reasonable customer rates, reliable customer service, customer and
employee safety, and comrnitment to employees and communities served.
b. Dominion Questar Gas will benefit by having an enhanced ability to
finance capital investments that ensure safe, reliable and cost-effective operations across a
growing customer base.
c. Dominion's long-term investment focus means that Dominion intends to
own Dominion Questar Gas for the Iong tenn, lending stability to, and confidence in, Dominion
Questar Gas' continued role as a dependable supplier of natural gas scrvice at reasonable rates.
d. Questar Gas will benefit from being part of a corporate organization that
has enhanced geographic, business, and regulatory diversity and greater financial and operational
-30-
scale. Dominion brings business diversity to Questar Corporation and Questar Gas. In addition
to Dominion's extensive experience in the natural gas industry, Dominion is a leader in all
aspects of the electric industry. Dominion has invested in a variety of energy resources,
including natural gas, coal, nuclear, wind, solar and biomass and can share best practices learned
in operating across this diverse portfolio. Dominion has invested nearly $1 billion in solar
gcneration projects in the Intermountain West. Dominion, through its energy subsidiaries, has an
established record for formulating its policies and plans in customer or stakeholder processes.
Dominion's operations in the Mid-Atlantic region also provide geographical diversity which will
strengthen Questar Corporation and Questar Gas. A benefit of geographic diversity is that if a
natural disaster were to occur in Dominion Questar Gas' service area after the Merger, l)ominion
Questal Gas would have access to resources such as call centers, operations and tnanagement
outside the affected area.
e. Dominion has an established record of focusing on customer, employee and
public safety similar to that already in place at Questar Gas. Dominion Questar Gas will be
expectcd to continue that focus as part of the Dorninion family.
f. Dorninion and its subsidiaries have a demonstrated history of emphasizing
the irnporlance of positive lelationships with customers, regulators, lcgislators, and consumer
representatives.
g. Dominion Questar Gas will benefit from participation in the Dominion
Servicc model wherein each of Donrinion's operations has access to an array and levcl of
services, support and economies of scale that are typically only available to a much larger
company. As a result of its larger size and buying power, Dominion expects to be able, over
-31-
time, to reduce administrative and operations and maintenance expenses incurred by Dominion
Questar Gas.
h. With an enhanced national presence, the combined company and its
subsidiaries will benefit from having a relevant and informed perspective and impact on energy
policy discussions that stand to positively impact the quality, safety, reliability, and cost of the
services offered to customers.
As one of the largest and safest operators of energy infrastructure assets,
the combined company and its subsidiaries will benefit from the adoption of best practices across
an expanded platform of service which stands to improve employee and public safety, increase
customer service, and minimize operational costs.
j. As one of the largest and most
company participants in public equity and debt capital
subsidiaries will benefit from an enhanced ability to
reliability to the benefit of customers.
61. Questar Gas and Dominron
states in which Questar Gas provides retail
aotive regulated energy infrastructure
markets, the combined company and its
efficiently finance system growth and
three
60. The above-mentioned commitments, understandings and benefits will be of
substantial value to Dominion Questar Gas' customers, employees and communities in future
years and demonstrate that the Merger is clearly in the public interest.
V[I. OTHER MATTERS
A.Regulatory Filings
are concurrently making filings in each of the
natural gas service: Utah, Wyoming and Idaho.
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62. Dominion is not required to obtain any other approvals of the Merger in the states
where its public utility subsidiaries currently provide regulated natural gas or electric service.
63. Dominion and Questar made notification filings pursuant to the Hart-Scott-
Rodino Antitrust Improvement Act of 1976 on February 12,2016 and received notice of early
termination on February 22,2016.
B. Impact on Other Public Utilities
64. Questar Gas and Dominion anticipate that the Merger will not have any impact on
any other public utility. Following the Merger, Dominion Questar Gas will continue to operate
in the same manner as it operates currently, utilizing the same Tariff and under the same
contracts in effect currently.
C. Shareholder Approval
65. Questar Corporation's shareholders are required to approve the Merger. Questar
Corporation will issue a proxy statement to its shareholders and schedule a special meeting of
shareholders for the purposc of voting on the merger.
66. Dominion's shareholders are not required to approve the Mcrger.
Ix. SUPPORTINGTESTIMONY
67. This Joint Application is supporled by testimony frorn the following witnesses:
a. Craig C. Wagstaff, President, Questar Gas. Mr. Wagstaffs Direct
Testimony is Joint Applicants' Exhibit 2.0.
b. David M. Curtis, Vice President and Controller, Questar Corporation and
Questar Gas. Mr. Curtis's Direct Testimony is Joint Applicants' Exhibit 3.0.
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c. Thomas F. Farrell, II, Chairman, President and CEO, Dominion. Mr.
Farrell's Direct Testimony is Joint Applicants' Exhibit 4.0.
d. Diane Leopold, President, Dominion Energy. Ms. Leopold's Direct
Testimony is Joint Applicants' Exhibit 5.0.
e. Fred G. Wood, III, Senior Vice President Financial Management (Energy
Infrastructure Group), Dominion. Mr. Wood's Direct Testimony is Joint Applicants' Exhibit
6.0.
x.TIME FOR PROCESSING THE JOINT APPLICATION
68. Dominion's proposed acquisition of Questar Corporation is an important
transaction for Questar Gas' customers, employees and communities. In order to mitigate the ill-
effects of unceftainty associated with the pendency of the Merger and expedite the delivery of
the benefits of the Merger, Questar Gas and Dominion respectfully request, consistent with
giving the Commission an opportunity to thoroughly review the Merger and satisfu itself that it
is in the public interest, completion of the Cornmission's review and approval of the Merger as
soon as reasonably possible.
69. Questar Gas and Dominion respectfully request that the Commission schedule a
scheduling conf'erence on the Joint Application as soon as possible and in any event within two
weeks of the filing of this Joint Application.
XI. CONCLUSION
70. Dominion is a strong and well-financed company that makes safety its highest
priority. It has made cornmitments that will be of substantial value to the customers, employees,
communities and states served by Questar Gas. Included are commitments that will assure that
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Dorninion Questal Gas remains a Utah-based company and that its operations will continue in
the same maruler. Dominion Qr"restar Gas will continue its tradition of providing safe and
reiiable service at reasonable cost to its customers in Utah and other states. Regulation of
Questar Gas wiil not be affected by the Merger. Dominion will make available increased
financial and managerial resources to Dorninion Questar Gas, and Dominion Questar Ga.s
employees will receive the bencfit of increased firnding of their pension and OPEB plans.
Dominion is comrnitted to the envilonment and wiii maintain the environmental monitoling and
maintenance programs of Dominion Questar Gas at or above current levels. Dominion rvill also
increase charitable contributions in the conmunities served by Dominion Questar Gas and rvill
maintain or increase historic levels of community involvement, low income funding, and
economic developrnent efforts in Dominion Questar's operation areas. Dominion anticipates that
over time Dorninion Questar Gas' costs malr fs lower than they would have been absent thc
Merger as a result of l)ominion's size and buying po\ ier.
' 71. Dominion looks forward to being able to invest in the fi.rture of Questar Gas,
focusing upon objectives of safety, customer satisfaction, reliable economic service,
cnvironmental stewardship and coilaborative and productive relationships rvith customers,
regulators, other govemmental entities and interested stakeholders. This Joint Application and
the supporling testimony demonstratc that it is committed to these objectives.
WHEREFORE, Questar Gas and Dominion respectfully request that the Commission:
a. schedule a scheduling conference on this Joint Application as soon as
possible and, in any event, within two weeks of the filing of this .ioint Application;
b. issne an order approving the Mergel whereby Questar Corporation will
become a wholly-owned subsidiary of Dominion;
-3 5-
c. issue an accouuting order authorizing Questar Gas to defer for possible
future recovery in rates, if it elects to do so, the transition costs it incurs associated rvith the
Merger; and
d. grant such other and further relief as nlay be deemed necessary.
DATED: March 3.2016.
Jenniffer Nelson Clark
Que.star Corporation
Gregory B. Monson
Cameron L. Sabin
Stoel Rives LLP
Al tonteys .fs r Questar Gas Contpanl,
Sharon L. Burr
Lisa S. Booth
Domirtion Resources, Inc.
Joseph K. Reid III
Bernatrd L McNamee lI
McGuireWoods
Blian W. Bulnett
Callister Nebeker & McCullough
Atto rtrcy.t .fs r Domin.i ort Reso urces, In.c.
-36-
Joint Application
Docket No. 16-057-01
Exhibit 1.1
EXECUTION VERSION
AGREEMENT AND PLAN OF MERGER
Dated as of January 31,2016
by and among
DOMINION RESOURCES, INC.,
DIAMOND BEEHTVE CORP.
and
QIIESTAR CORPORATION
Joint Application
Docket No. l6-057-01
Exhibit 1.1
TABLE OF CONTENTS
Page
Article I The Merger...... .................2
Section 1.1 The Merger ......................2
Section 1.2 Closing....., ...................,2
Section 1.3 Effective Tirne.......... .........................2
Section 1.4 Effects of the Merger............,.. ..."......2
Section 1.5 Articles of lncorporation and Bylaws of the Surviving Corporatioir........-..2
Section 1.6 Directors and Officers of the Surviving Corpotation .....,..,,,,,.....................3
Section 1.7 Post-Merger Operations ......"......."......3
Article II Effect of the Merger on Capital Stock ..,..."........4
Section 2.1 Effect on Capital Stock..,..,.... .............4
Section 2.2 Exchange of Cer1ificates................ ..,..................,.,5
Section 2.3 Treatrrent of Equity Awards....... ............-..............8
Section 2.4 Adjustrnents..............,.. ............,.........9
Article TII Representations and Warranties of the Company....,........... .....,........10
Section 3.1 Organization, Standing and Corporate Power ........-.-.......-.....10
Section 3.2 Capitalization .,...,........... ...,..........,....1 1
Section 3.3 Authority; Non-contravention......... .........,...........12
Section 3.4 GovernrnentalApprovals................ ..,,.........,.......13
Section 3.5 Corrpany SEC Documents; IJndisclosed Liabilities,................................13
Section 3.6 Absence of Certain Changes..... ......15
Section 3.7 Legal Proceedings........ ..,,..........,.....15
Ssction 3.8 Cornpliance With Laws; Permits ........,......."".......15
Section 3.9 Tax Matters ............"......15
Section 3.10 Employee Benefits Matters....... ...,....,.........,...,,.17
Section 3.11 Environmental Mattels.. ...................18
Section 3.12 Intellectual Propefty..,.. ...,,...............18
Section 3,13 Takeover Statutes; Rigltts Plan........... ......".........19
Section 3,14 Properties and Assets ......................".19
Section 3.15 Contracts ,.,..,.,...,...........21
Section 3.16 Labor......... ........,...........21
Section 3.17 Opinion of FinancialAdvisor ..".......,21
Section 3.18 Blokers and Other Advisors..... .,....22
Section 3.19 Company Shaleholder Approval.... ......................22
Article fV Representations and Wan'anties of Parent and Merger Sub..................-..-.--.......22
Section 4.i Organization, Standing and Corporate Power .......................22
Section 4.2 Authority;Noncontravention ..........22
Section 4.3 Governmental Approvals......,......... .....................23
Section 4.4 Brokers and Other Advisors,.,.. .......23
Section 4.5 Ownership and Operations of Merger Sub,......... ............,.,....23
Section 4.6 Sufficient Funds ..........23
t<E 39423794
Joint Application
Docket No. 16-057-01
Exhibit 1.1
TABLE OF {]ON'I'ITN 'S (C'ON'T'D)
Page
Section 4.7 Share Ownership........... ...................24
Section 4.8 Legal Proceedings........ .......-............24
Section 4.9 Non-Reliance on Company Estimates, Projections, Forecasts,
Forward-Looking Statements and Business Plans..,.,..... ,......21
Article V Covenants................ ......25
Section 5.1 Conduct of Business ....................,,..25
Section 5.2 Pleparation of tlte Proxy Statenien! Shareholders Meeting ....,.............,,,29
Section 5.3 No Solicitation; Change in Recommendation....... ........,..,.,...30
Section 5.4 Reasonable Best Efforts .................,.33
Section 5.5 Pr:blic Anuouncernents ............ .......36
Section 5.6 Access to lnfonnation; Confidentiality....,,,. ..,...36
Section 5,7 Takeover Laws.......... ...,........,.....,.,...37
Section 5.8 Indemnification and Insurance.... ......................".37
Section 5,9 Transaction Litigation,.. ...................39
Section 5.10 Section 16................ ............."..........39
Section 5.11 Ernployee Matlers .......39
Section 5.12 Merger Sub and Swviving Corporation ..............42
Section 5.13 No Control of Other Party's Business ................42
Section 5.14 Stock Exchange Delisting; Exchange Act Deregistration ,......,...,....,....,..42
Section 5,15 Advice of Changes. .......,.,...............42
Section 5.16 Financing Cooperation ,..,.,,..............43
Article VI Conditions Precedent................ ....,...................4d
Section 6.1 Conditions to Each Party's Obligation to Effect the Melger.....................44
Section 6.2 Conditions to Obligations of Parent and Merger Sub................................45
Section 6.3 Conditions to Obligations of the Cornpany .".....,.45
Section 6.4 Frustration of Closing Conditions. ."...,.....,....".....46
Article VII Termination ,.,,........."46
Section 7.1 Tennination ...,..,.....,....,.4(r
Section 7.2 Effect of Termination......,....... ...."....,48
Section 7.3 Company Tertnitration Fee ....,,.....,. ........."..,"......48
Article \{I[ Miscellaneous ...........51
Section 8.1 No Survival of Representations and Warranties,.....,..,... .......51
Section 8.2 Fees and Expenses .......51
Section 8.3 l,lnendment or Supplerneut .............. ...,.....,.........51
Section 8.4 Waiver',..,,,, ....,,,..........,..51
Section 8.5 Assignment ...................51
Section 8.6 Countetparts...............,. ...................52
Section 8.7 Entire Agreernent; Third-Party Beneficiaries................. .......52
Section 8.8 Governing Law; Jurisdiction.......... ..................,..52
Section 8.9 Specific Enforcement.................. .................".....53
Sebtion 8,10 WAIVER OF ruRY TRIAL..,.... .....................,..54
Section 8.1 I Notices .-.-,-..-.-.-.-..--..-,..54
t<E 39423794
Joint Application
DocketNo. 16-057-01
Exhibit 1.1
TABLB OF CONTAI{TS (CONT'D)
Page
Section 8.12 Severability ........."..........55
Section 8.13 Definitions. ,.........,.........55
Section 8.14 TransferTaxes ...............65
Section 8.15 Interpretation................. ...................-65
lll
Joint Application
Docket No. 16-057-01
Exhibit 1.1
AGREEMENT AND PLAN OF MERGER
This AGREEMENT AND PLAN OF MERGER, dated as of January 31, 2016 (tlris
"Agreenrent"), is enteLed into by and among Dorrrinion Resources, Inc., a Virginia corporation
("Parent"), Dianiond Beehive Corp., a Utah corporation and a direct, wholly-owned Subsidialy
of Parent ("Mergcr Sub"), and Questar Corporation, a Utah corporation (thc "Company").
Definecl terms used herein have the respective meanings set forth in Seclion 8. 13.
WiTNESSETH
WHEREAS, the parties intend that, at the Effective Time, Merger Sub will, in
accordance with tlie Utah Revised Business Corporation Act (the "I-JRBCA"), merge with and
into the Company, with the Company continuing as the suruiving corporation (the "Merser') on
thE terrrs and subject to the conditions set forth in this Agreement;
WHEREAS, the board of directors of the Company (the "Cr:rnpiliy Boald") has (a)
detennined that it is in tl,e best interests of the Company and its shareholders for the Cornpany to
enter into this Agleement, (b) adopted the plan of merger set forth in this Agteement and
approved the Con-rpany's execution, delivery and performance of this Agreement and the
consummation of the tmnsactions contemplated hereby (including the consumtnation of the
Merger upon the tenns and subject to the conditions set forth in this Agreement and in
accordance with the relevant provisions of the URBCA) and (c) resolved to subrnit this
Agreement to the Company's shareholders and recommend that the Company's shareholders
approve this Agreement and the plan of melger set forth in this Agreement;
WHEREAS, the board of directors of Parent has (a) detennined that it is in the best
interests of Parent ancl its shareholders for Parent to enter into this Agreernent and (b) approved
Parent's execution, delivery and perfonnance of this Agreement and the consumrlation of the
transactions contemplated hereby (including the consummation of the Merger upon the terms and
subject to the conditions set fortlr in this Agreenrent and in accordance witli the relevant
provisions of the URBCA);
WHEREAS, the board of directors of Merger Sub has (a) determined that it is in the best
interests of Merger Sub and its sole sharelrolder for Merger Sub to enter into this Agreernent, (b)
adopted the plan of rnerger set forth in this Agreement and approved Merger Sub's execution,
delivery and performance of this Agreement and the consuntmation of the transactions
contemplated hereby (including the consummation of the Merger upon the terms and subject to
the conditions set forth in this Agreement and in accordance with the relevant provisions of the
URBCA) and (c) resolved to submit this Agreernent to the Merger Sub's sole shareholder and
recommend that Parent, in its capacity as Melger Sub's sole shareholder, approve this
Agreement and the plan of merger set forth in this Agreement;
WHEREAS, Parent, in its capacity as the sole shareholder of Merger Sub, has approved
tliis Agreement by written consent; and
WHEREAS, Parent, Merger Sub and the Conrpany desire to make cefiain
representations, warranties, covenants and agleements specified herein in connection with this
Agreement,
K839423794
Joint Application
Docket No. 16-057-01
Exhibit 1.1
NOW, TFIEREFORE, ia consideration of the representations, warranties, covenants and
agreements contained in this Agreement and othel good and valuable consideration, the receipt
and sufficienoy of which are hereby acknowledged, and intending to be legally bound hereby,
Parent, Merger Sub and the Cornpany hereby agtee as follows:
ARTICLE I
THE MERGER
Section 1.1 The Mereer. Upon the terms and subject to the conditions set forth in
this Agreement, and in accordance with the IIRBCA, at the Effective Time, Merger Sub shail be
tnerged with and into the Company, and the separate existence of Merger Sub shall thereupon
cease, and the Cornpany shall be the surviving corporation irr the Merger (the "furyly"iry
Cq$o$lion") and shall becorner as a result of the Merger, a direct, wholly-owned subsidiary of
Parent.
Section 1.2 Cloqige. The consummation of the Merger (the "Closinq") shall take
place at the offices of Kirkland & Ellis LLP, 601 Lexington Avenue, New York, New Yolk
10022 at 10:00 a.m, (local time) on the date that is two (2) Business Days following the
satisfaction or waiver (to the extent permitted by applicable Larv) of the conditions set forth in
Article VI (other than tlrose conditions that by their nature are to be satisfied at the Closirrg, but
subject to the satisfaction or waiver of those conditions at such time), or on such other date aud
at such other time or place as is agreed to in writing by the pafties hereto, The date on which the
Closing occrtrs is referred to herein as the "Closing Date."
Section 1.3 Elfective Timc. Subject to the provisions of this Agreement, on the
Closing Date, the Surviving Corporation shall file with the Utah Department of Commerce,
Division of Corporations and Commercial Code (the "Djvlsig[") afticles of merger (the "Articles
o[ I\4erger:") executed in accordance with, and corrtaining such information as is requiled by,
Section 1105 of the TIRRCA al1d, on or after the Closing Datc, shall make all other filings or
recordings required under the URBCA to effectuate the Merger'. The Mergel shall become
effective at such time as the A.r'ticles of Merger are duly filed with the Division or at such later
time as is permissible under the URBCA and is specified in the Articles of Merger (the time the
Merger becomes effective being heleinafter referred to as the "lliffective 'Iirue").
Section 1.4 EffectS.of tho Merser. The Merger shall have the effects set forfh in this
Agreement, the Articles of Merger and the applicable provisions of the URBCA.
Section 1.5 Articlcs of Inco[noration arrtl l]vlarvs of thc Survivine Corrroration.
At the Effectivc Timc, the articles of incorporation and bylaws of the Cornpany, in each case as
amended to date and as in effect imrnediately prior to the Effective Tirne (the "Cornnany Charler
Docuurents"), sl,all be arnended as of the Effective Time to be in the form of (except with respect
to the naure of tlte Corrpany (which shall be "Dominion Questar Corporation"), auy changes
neoessary so that they shall be in compliance with Ssction 5.8 and, to the extent not inconsistent
with any of the foregoing, such ottrel changes as Parent deems rlecessary or appropriate) the
articles of incorporation and bylaws of Merger Sub as olthe date hereof and as so ameuded shall
KE 39423194
Joint Application
Docket No, l6-057-01
Exhibit I .l
be the articles of incorporation and bylaws of the Surr,riving Corporation until theleafter arnended
as ptovided therein or by applicable Law (and subject to Section 5.8).
Section 1.6 Directors and Officers of the Suryivine Corporation.
(a) The directors of Merger Sub irnmediately prior to the Effective Time shall
be tl'rc directors of the Surviving Corporation immediately following the Effective Tirne, to serve
until their lespective successol's are duly elected or appointed and qualified or until their earlier
death, resignation or removal in accordance with the articles of iucorporation and bylaws of the
Surviving Corporation.
(b) The officers of the Company irnrnediately prior to the Effective Time shall
be the officers of the Surviving Corporation irnmediately following the Effective Time, to serve
until their respective sucoessors are duly appointed and qualified or until tlieir earlier death,
resigriation or removal in accordance with the articles of incorporation and bylaws of the
Surviving Corporatiorr.
Section 1.7 Post-Merger Operafions Parent hereby confirms that, subject to flre
occurrencc of the Effective Tirne, it:
(a)
Lake City, Utah;
(b)
Lalce City, Utah;
intends to maintain Questar Gas Company's corporate headquarters in Salt
intends to establish a new Western Region Operating Headqr"rarters in Salt
(c) will, shottly after the Effective Time, operate Questar Gas Company under
tlre narne "Domiuion Questar Gas Company";
(d) will rnalte a good faith cornrnitment to give the Company's employees duc
and fair consideration for other employment and plomotion opportunities rvithin the larger Parent
organization, both inside and outside of Utah, to the extent any Cornpany ernploymcnt positions
are re-aligned, reduced or eliminated in the future as a result of the Transactions;
(e) intends that Parent's boald of directors will take all necessary action as
soon as practical after the Effective Time to appoint a rnutually agreeable current member of the
Company Board as a director to serve on Parent's board of directors;
(0 will take all necessary action so that, if at any time following the Effective
Time, either Questar Pipeline Cornpany or a material portion of its assets is coutributed to
Donrinion Midstrearn Partners, Parent shall cause a mutually agreeable current member of the
Company Board to be appointed as a director to serve on DMPGP's board of directors;
(g) intends to inclease the Company's historic level of corporate contributions
to charities identified by local leadership that are within Questar Gas Company's current
legulated letail operating areas by $1,000,000.00 per year for at least five (5) years and to
maintairr or increase historic levels of comtnunity involvement, low incorne f'unding, and
economic development efforts in the Cornpany's curuent opelating areas;
t<8 39423794
Joint Application
Docket No. 16-057-01
Ilxhibit I .l
0, intends to establish a newly fonned advisory board for its western
opelations composed of regional-based business arrd cornmunity leaders, which would meet
several times a yeal to receive infonnation and provide feedbacl< on comnurrity issues,
government relations, envitonrnental stewardship, econornic development opportunities and
other related activities that affect Parent's aud the Company's local stalceholders, with such
advisory board to include the current regional-based members of the Cornpariy Board; and
(i) will use cotnrnercially reasonable efforts (subject to changes in iuterest
rates or other actuarial fbctors and the plans' investlnent perfonnance) to provide up to
$75,000,000 toward the full funding of (i) the Cornpany's ERlSA-qualified defined-benefit
pension plan iu accordance with ENSA minimum funding requirements for ongoing plans, and
(ii) the Cotnpany's nonqualified defined-benefit pension and postretirement rnedical and life
insurance (OPEB) plans on a financial accounting basis, in each case by the end of the first fiscal
yeal commencing on or after the Effective Time, subject to any maximum contlibution levels or
othet' restrictions under applicable Law.
ARTICLE II
EFFECT OF'THE MERGER ON CAPITAL STOCK
Section 2.1 llffect on Capital Stoch. At the Effective Tirne, by virtue of tlie Mergel
and without arry action on the part of the Company, Parent or Merger Sub or any holder of any
shares of common stock, witlrout par value, of the Company ("Corr:parr), Cornnron Stock") or
any shares of capital stock of Merger Sub:
(") Capital Stock tlf Mcrger Sub. Each issued and outstanding share of capital
stock of Merger Sub shall be converted into and become one validly issued, fully paid and non-
assessable share of common stock, no par value per share, of the Surviving Corporation.
O) Cancellation of Parent-Orvned Stock. Any shares of Cornpany Comnon
Stock that are owned by Parent or Merger Sub or any of their respective Subsidiaries, in each
case immediately prior to the Effective Time, shall be autornatically cancelcd and shall cease to
exist, and no considetation shall be delivered in exchange therefor.
(c) Conversion ol'Companv Cornnron Stock, Each issued and outstanding
share of Company Cotntnon Stock (other tharr Dissenting Shareholder Shares and shares to be
canoeled in accordance with Section 2.1(b)) shall thereupon be convefted automatically into and
slrall thereafter represent solely the right to receive an arnount iu cash equal to $25.00 rvithout
interest (the "Mcrger Consitlerati<.rn"). As of the Effective 'fime, all such shares of Cornpany
Common Stoclc shall no longer be outstanding and shall automatically be canceled and sliall
cease to exist, and the holders irlmediately prior to the Effective Time of shares of Company
Cotnnton Stocl< not represented by certificates ("Bor-rk-lltrtry Shares") and the holders of
certificates that imrnediately prior to the Effective Tirnc rcprcsented any such shares of Company
Common Stock (each, a "Certificate") shall cease to have any riglrts with respect thereto, except
the right to receive the Melger Cousideration to hc paid in consideration therefol upon surrender
of such Book-Entry Share ol Certificate in accordance with scction 2.2(t:) (subject to any
applicable withliolding Tax).
KE 39423794
Joint Application
Docket No. 16-057-01
Exhibit i.I
(d) Disscrrtels' Rishts. Notwithstanding anything in this Agreement to the
contrary, shares of Company Cornmon Stock that are issued and outstanding i-rnrnediately prior
to the Effective Tirne which are held by a shareholder who did not vote in favor of the Merger
(or consent thereto in writing) and wlio is entitled to demand and properly demands payment of
the fair value of such shares pursuant to, and complies in all respects with, the provisions of Part
l3 of the URBCA (the "Dissenting Sltarelrolder Shares", and each shareholder holding
Dissenting Shareholder Shares, a "Dissenting Sha.lg.i1qlglgl-) slrall not be convelted into or be
exchaugeable for the right to receive the Merger Consideration, but instead such Dissenting
Shareholder shall be entitled to receive such consideration as may be deten:rined to be due to
sucli Dissenting Shareholder pursuant to Sectiol 1302 of the URBCA (and as of the Effsctive
Time, such Dissenting Shareholder Shares shali no lotrget be outstauding aud shall aLrtomatically
be cancelled and shall ccase to exist, and such Disserrting Shareholder shall cease to have any
rights with respect tirereto, except the rights set forth in Part 13 of the URBCA), unless and untii
such Dissenting Shareholder shall have failed to perfect or shall have effectively withdrawn or
lost rights to payment under Paft l3 of the IIRBCA. If any Dissenting Shareholder shall have
failed to perfect or shall have effectively withdl'awn or lost such right, such Dissenting
Shareholder's shares of Company Cotnmon Stock shallthereupon be treated as if they had been
converted into and become exchangeable for tlie right to receive, as of the Effective Tiure, the
Merger Consideration for each such share of Company Common Stock, in accordance with
Section 2.1(a), subject to any applicable withholding Tax. The Company shall give Parent
(i) prompt notice of any written dernands forpayment of the fair value of any shares of Cornpany
Cornrnon Stock, atternpted withdrawals of such demands aud any other instruments serued
pursuant to the URBCA and received by the Company relating to shareholders' dissenters' rights
under Parl i3 of the URBCA and (ii) the opportunity to participate in and direct all negotiations
and proceedings with respect to demands for payrnent of fait value under the URBCA. The
Company shall not, except with the prior written consent of Parent (not to be unreasonably
withheld, conditioned or delayed), make any payment with respect to any such dernands for
payment or settle or offer to settle any such demands for payment.
Section 2.2 Exchatqe of Certificates.
(a) Paying Agenl: Investment lry Payifg Agent of ljunds. Prior to the
Irffective 'l'irne, Palent shall desiguate a banl< or trust company reasonably acceptable to the
Cotnpany (the "fgylllg_49fl1") for the purpose of exchanging shares of Company Common
Stock for tire Merger Consideration and enter into an agreement reasonably acceptable to the
Company with the Paying Agent relating to the services to be performed by the Paying Agerrt.
Parent sirall irrevocably deposit, or cause to be deposited, the aggregate Merger Consideration
with respect to all shares of Cornpany Cornmon Stock (other than Dissenting Shareholder Shares
and shares to be canceled in accordance with Section 2.1(b)) with the Paying Agent at or prior to
the Effective Time. The aggregate Merger Consideratiorr deposited rvith the Paying Agent sliall,
pending its disbursement to holders of shares of Company Common Stock and as reasonatrly
directed by Parent, be invested by the Paying Agent in (i) short-term commercial paper
obligations of issuers organized under the Laws of astate of the United States of America, rated
A-l or P-l or better by Moody's Investols Setvice, Inc. or Stanclat'd & Poor's Ratings Service,
respectively, or in certificates of deposit, [:anl< repurchase agreements or bankers'acceptances of
commercial banl<s with capital exceeding $10,000,000,000, or in mutual funds investing in such
asscts or (ii) short-term obligations for which the full faith and cledit of the United States of
Kr.39423794
Joint Application
Docket No. 16-057-01
Exhibir I .1
America is pledged to plovide for the payment of plincipal and interest. Any interest and other
income fl'otn such investnrents shall becorne part of the funds held by the Paying Agent for
purposes of payirrg the Merger Consideration. No investment or investment losses resulting
frorn such investment by the Paying Agent of the aggregate Merger Consideration shall relieve
Parent, the Surviving Corpolation or the Paying Agent fi'om rnaking the payrnerits requiled by
this Arlicle ll, and Parent shall promptly replace any funds deposited with the Paying Agent lost
through any investment nrade pursuant to this Section 2..2(a). No investrnent by the Paying
Agent of the aggregate Merger Consideration shall have maturities thatcouldplevent or delay
paytnents to be made pursuant to this Agleement. Following the Effective Time, Parent agrees
to make available to tire Paying Agent, fl'om time to time as needed, additional cash to pay the
Metger Consideration as contemplated by this Articie II without interest.
(b) Pautrent Pt'ocedures. As promptly as placticable after the Effective Time
(but in no event more than two (2) Business Days thereafter), the Surviving Corporation shall
cause the Paying Agent to mail to each holder of record of shares of Company Common Stocl<
(i) a letter of transmittal (rvhich, in the case of shares of Cornpany Courmon Stock replesented by
Cefiificates, shall specify that delivery shall be effected, and risk of loss and title to the
Certificates sltall pass, only upon delivery of the Certificates to the Paying Agent, and shall be in
such form and have such other provisions as Parent and the Company ntay reasonably agree and
shall be prepared prior to Closing) and (ii) instructions for use in effecting the surrerrder of the
Certificates or Book-Entry Shares in exchange for paynent of the Merger Consideration. Upon
surrender of Cerlificates for cancellation to the Paying Agent or, in the case of Book-Entry
Shares, leceipt of arr "agent's message" by the Paying Agent (ol such other evidence, if any, of
transfer as the Paying Agent may reasonably reqr-rest), together with such letter of transmittal,
duly conrpleted and validly executed in accordance with the instructions (and such other
customary documents as may reasorrably be required by the Paying Agent), the holder of such
Certificates or Book-Entry Shares shall be entitled to receive in excharrge therefor, subject to any
required witltholding Taxes, the Merger Consideration, for each share of Cornpany Common
Stock sunendeled, arrd any Certificates suuendered shall forlhwith be canceled. If payrnent of
the Mergel Consideration is to be made to a Person other than the Person in whose narne the
suuendered Certificate ol Book-Enty Share in exchange therefor is registered, it shall be a
condition of payrnent that (A) the Persou requesting such exchange plesent proper evidence of
transfer and (B) the Person requesting such payment shall have paid atry transfer and othel Taxes
required by reason of the paynent of the Merger Considemtiotr to a Person other than the
registered holder of such Certificate or Book-Entry Share surendered or shall have established
to thc reasonabie satisfactiou of the Survivilg Corpolation that such Tax either has been paid or
is not applicable. Until surrendered as conternplated by this r-ection 2.2, each Certificate arrd
Book-Entry Share shall be deemed at any tinre after the Effective Time to represent only the
right to receive the Merger Consideration as contemplated by this r\rticle I L
(c) 'franslcl BoQl$l j!,g_[]urther O$,nershir: llishts i!] lcqlltpauy ]conlmon
Stocl<. The Merger Consideration paid in respect of shales of Company Corrunon Stock upon the
surretrder for exchange in accordance with the tetms of this Arlicle II shall be deemed to have
been paid in fu1l satisfaction of all riglrts perlairiing to the shares of Cornpany Cornrnon Stocl<,
and at the Effective Time, the stoclc transfel books of thc Cornpany shall be closed and thereafter
there shall be no furthel registration of transf'ers on the stock transfer boolcs of the Surviving
Cotporatiorr of thc sharcs of Cornpany Common Stock that were outstanding irnrnediately prior
t(E \9423't94
.loint Applicatiorr
DocketNo. 16-057-01
Exhibit 1 .l
to the Effective Time. From and after the Effective Tirne, the holders of Certificates or Book-
Entry Slrares that evidenced ownership of shares of Colnpany Cornmon Stock outstanding
irnmediately priol to the Effective Tirne shall cease to have any rights with respect to such shares
of Company Common Stock other than the right to receive the Merger Consideration, except as
otherwise provided for helein or by applicable Law. If, at any time after the Effective Tirne,
Certificates a1'e presented to the Surviving Corporation for any reason, they shall be catrceled and
exchanged as provided in this Artiqle II.
(d) Lost.-Stolerr ol Destloyed Ccrtifig(gl. If any Certificate shall have been
Iost, stolen or destroyed, upon the making of an affidavit of that fact by the Pei'son clairning such
Certificate to be lost, stolen or destroyed and, if required by the Surviving Corporation, the
posting by such Persorr of a bond, in such reasonable amount as Parent may direct, as indemnity
against arry claim that rnay be made with respect to such Certificate, the Paying Agent will pay,
in exchange for such lost, stoien or destroyed Certificate, the applioable Merger Cousideratiou to
be paid in respect of the shares of Company Common Stock formerly represented by such
Certificate, as contemplated by this Alticlp-ll.
(e) l'qrntirqlierr q{" l'uld. At any tirne following the first (1st) anniversary of
the Closing Date, the Surviving Corporation shall be entitled to require the Paying Agent to
deliver to it any funds (including any interest received with respect thereto) that had been made
available to tlre Paying Agent and which have not been disbursed in accordance with this Article
II, and thereafter Persons entitled to receive payment pursuant to this Article ll shall be entitled
to look only to the Surviving Corporation (subject to abandoned property, escheat or other
similar Laws) as general creditors thereof with respect to the payment of any Mergel
Consideration that may be payable upon surrender of any Company Common Stock held by such
holders, as determiued pursuant to this Agreement, without any intelest thereon. Any amounts
remaining unolairned by such holders at such time at which such amounts would otherwise
escheat to or become property of any Govemmental Authority shall become, to the extent
pennitted by applicable Law, the ploperty of the Surviving Corporation, free and clear of all
clairns or interest of any Person previously entitled thereto,
(D No Liability. Norwithstanding any other provision of this Agreement,
none of Parent, the Merger Sub, the Surviving Corporation, the Company or the Paying Agent
shall be Iiable to any Person for Merger Consideration delivered to a publio official pursuant to
any applicable abandoned property, escheat or sirnilar Law,
(g) .lYj!:jplduigl axgg. Parent, the Surviving Corporation and the Paying
Agent shall be entitled to deduct and withhold frorn the consideration otherwise payable to a
holder of shares of Company Common Stock, Company RSUs or Company Perfonnance Share
Awards pursuant to this Agreement such anrounts as may be required to be deduoted and
withheld with respect to the making of such payment under the Lrtemal Revenue Code of I986
(the "Code"), ol under any applicable plovision of state, local or foreign Law related to Taxes.
To the extent arnounts are so withheld and timely paid ovel to the appropriate Taxing authority,
the withheld amounts shall be treated for all purposes of this Agreenrent as lraving been paid to
the Person in respect of which such deduction and withholding was made. Parent, the Company,
the Surviving Corporation, and the Paying Agerrt shall cooperate with such liolders in all
t<E 39423794
Joint Application
Docket No. l6-057-01
teasonable respects, and in compliance with applicable Law, to minimize the amount of any
applicable witiillolding,
Section 2.3 Tre&tnrent of Eeuitv Arvards.
(a) Conrpany RSUs. Imrnediately prior to the Effective Time, each Company
RSU that is outstanding shall be conveded into a vested right to receive cash in an arnount equal
to the Merger Consideration.
(b) . Immediately prior to the Effective
Tirne, each Cornpany Performance Share Award tlrat is outstanding (including any Company
Performance Share Award witlr respect to which the applicable pelformance period has ended,
but which Cornpany Performance Share Award has not beeu settled) shall be converted into a
vested right to receive cash in an amount equal to the greater of (i) the target number of shares of
Company Common Stock subject to such Company Perfonnance Share Award, multiplied by the
Merger Consideration and (ii) the actual number of shares of Cornpany Common Stoclc to which
the holder of such Company Perfonnance Share Award would be entitled based on actual
performance with respect to the applicable performance period rnultiplied by the Merger'
Considetation; plclvidod that if any outstandirrg Company Perfonnance Shale Award that is
utrvested as of the date hereof becoures vested and settled pursuant to tlie terms of the applicable
award agreernerrt and/or Company Stock Plan prior to the Effective Tirne then, immediately prior
to the Effective Time, the holder of such Company Pelfonnance Share Award shall be issued
such number of shares of Cornpany Comrnon Stock, if any, equal to the excess of (A) the
number of shares of Courpany Cornrnon Stock that would have vested and been settled in respect
of such Cornpany Pelformance Share Award if the perforrance goals or targets applicable to
such Company Pet'founance Share Award had been achieved at the target level, over @) the
actual uutnber of shares of Company Common Stock that vested and were settled in respect of
such Company Performance Share Award (such additional shares of Company Common Stock,
the "True-Up Slrares").
(") eglpa'ty Rsshictrd Shffi. Immediately priol to the Effective Time,
each Cornpany Restricted Share that is outstanding sliall be corrverted into a vested right to
receive cash in an amount equal to the Merger Consideration.
(d) Company-_Stoq-lS Option.r.. Inrmediately prior to the Effective Tirne, each
Cornpany Stock Option that is outstandirrg shall be convefied into a vested right to receive cash
in au amourrt equal to (i) the excess, if any, of the Merger Consideration ovel the exercise price
per share of Company Common Stock subject to such Company Stock Option multiplied by (ii)
the number of shares of Company Common Stock subject to such Company Stock Optiorl, and,
for the avoidance of dor.rbt, any Company Stocl< Option whose per share exercise price equals or
exceeds the Mergel Consideration shall be cancelled without any payment.
(e) Coml:any Stocl< Arvards. Immediately prior to the Effective Time, each
riglrt of aty kind, contingent or accrued, to acquire or receive Cornpany Comrnon Stoclc or'
benefits tneasured by the value of Company Comrnon Stock, and each award of any kind
consisting ofl shares of Conrpany Common Stock that may be held, awarded, outstanding,
payable or rcservcd for issuance under thc Cornpany Stock Plans and any other Cornpany Plans,
KE 39423194
.Ioint Application
Docket No. 16-057-01
Exhibit 1.1
other than Cornpany RSUs, Corlpany Performance Share Awards, Compauy Restricted Shares
and Company Stock Options (collectively, the "Company Arvards"), shall be converted into an
obligation to pay, at the tiure specified in the applicable plan, agreemeut or arangement, an
amount in cash equal to (x) the number of shares of Company Comrnon Stock subject to such
Cornpany Award immediately prior to the Effective Tirne multiplied bV (y) the Merger
Considelation. Such obligation shall be payable or distributable in accordance with the tenns of
the agreement, plan or arrangernent relating to such Company Awards (or, if earlier, on the death
of the holder thereof) and, prior to the time of distribution, such amounts shall be permitted to be
deemed invested in a pern-ritted investment option under the applicable agreement, plan or
attangement.
(0 Accunrulated Dividends. Immediately prior to the
Company shall distribute all Accumulated Dividends to the applicable
RSUs and Company Awards.
Effective Time, the
holders of Conrpany
(g) Withholclinq. The Surviving Corporation shall be entitled to deduct and
withhold from the airounts otherwise payable pursuant to this SqgUgU_ 2.1- to any holder of
Company RSUs, Company Perfotmance Share Awards, Cornpany Restricted Shares, Company
Stock Options, Company Awards or Accumulated Dividends such amounts as the Surviving
Corporation is required to deduct and withhold with respect to the making of such payment
under the Code, or any applicable provision of state, or local Law related to Tax, and the
Surviving Corporation shall timely malce any required filings and payments to Tax authorities
relating to any such deduction or withholding. To the extent that amounts are so deducted arrd
withheld by the Surviving Corporation, such withheld arnounts shall be treated for the purposes
of this Agreement as having been paid to the holder of Company RSUs, Cornpany Perfonnance
Share Awards, Company Restricted Shares, Cornpany Stock Options, Company Awards or
Accuinulated Dividends in respect of which such deduction and withholding was made by the
Surviving Corporation.
(h) Funclins. No later than the Effective Time, Parent shall provide, or shall
cause to be provided, to the Surviving Corporation all funds necessary to fulfill the obligations
under this Section 2.3. Al1 payrnents required under this Section 2.3 shall be made through the
Cornpany's payloll not later than the first payroll date following the Effective Time or, with
respect to Company Awardso such later time as may be provided under the applicable agreement,
plan or arrangement.
Section 2.4 Arliustnren[s. If at any time during the period between the date of this
Agreement and the Effective Time, any change in the outstanding shares of capital stooh of the
Company (or any other securities convertible or exchangeable therefor) shall occur as a result of
any reclassification, stock split (including a l'everse stock split) or combination, exchange or
readjustment of shares, or any stock dividend or stock distribution with a record date during such
period, or any sirnilar event, the Merger Consideration shall be equitably adjusted; prnvided.
.lLewovsr-, that nothing in this Section 2.4 shall be deemed to pennit or authorize any party hereto
to effect any such change that it is not otherwise authorized ol permitted to uudeftake pursuant to
this Agreen,ent.
Y\E3942J794
Joint Application
Docket No. 16-057-01
Exhibit 1.1
ARTICLE TII
REPRESENTATIONS AND WARRAI\{TIES OF THE COMPAI\TY
Except (a) as set forth in the disclosure scliedule deliveled by the Cornpany to Parent
sirnultaneously with the execution of this Agreement (tlie "Company Disclosutq $ctreduls")
(which schedule sets forth, among other things, itenrs the disclosure of which is necessary ol
applopriate eithel in response to an express disclosure requirernent contained in a provision
hereof or as an exception to one ol rnore representations or wan'anties contained in this Article
III, or to one or more of the Company's covenants contained in Article V, except that any
information set forth in one section of the Cornpany Disclosure Schedule will be deemed to
apply to all other sections or subsections thereofto the extent that such infonnation is reasonably
applicable) or (b) as set forlh in any of the Company SEC Docurnents publicly available at ieast
twenty-four (24) hours prior to the date of this Agreement, but excluding in the case of this
clause (b) any risk factor disclosure under the headings "Risk Factol's" ol' "Forward Looking
Statements", the Company represents and warrants to Parent and Merger Sub as follows:
Section 3.1 Organiniltion. Stundinq s$d Corporrte Porver.
(a) The Cornpany is a corporation duly organized, validly existing and in
good standing under the Laws of the State of Utah and has all requisite col'porate power and
authority necessary to own or lease all of its properties and assets arrd to can'y on its business as
it is now being conducted. The Company is duly qualified to do business and is in good standing
in each jurisdiction in which the nature of the business conducted by it ol the character or
Iocation of the propefiies and assets owned or leased by it makes such qualification necessary,
except where the failure to be so qualified or in good standing would not reasonably be expected
to have a Compary Material Adverse Effect. The Company has made available to Parent true
and complete copies of the Cornpany Clrarter Docnments as in effect on the date of this
Agreement.
(b) $ection 3.1(.b) of the Cornpany Disclosure Schedule sets fofth a Iist of the
Subsidiaties of the Company. Each Subsidiary of the Company is duly organized, validly
existing and in good standing urrder the laws of the jurisdiction of its organizatiorr, except in each
case as would not reasonably be expected to have a Company Material Adverse Effect. Each
Subsidiary of the Cornpany is duly qualified to do business and is in good standing in each
jurisdiction in which the nature of tlre business conducted by it or the character or location of the
properties and assets owned ol leased by it makes such qualification necessaty, except where the
failure to be so qualified or in good standing would not leasonably be expected to have a
Company Material Advelse Effect. All the outstanding ,shares of capital stock of, or other
equity intetests in, each Subsidiary of the Company have been validly issued and are fully paid
and non-assessable and are owned directly or indilectly by the Company fi'ee and clear of all
liens, pledges, security interests and transfer restrictions, except fol such transfel restrictions as
are contained in the articles of iucorpolation, bylaws and lirnited liabilify coutpauy agreements
(or any equivalent constituent documents) of such SubsidiaLy or fol suclr tlansfel restlictions of
genelal applicability as may be provided under the Securities Act of 1933 (the "Eq-r,uli1lql.Agl")
and other applicable Laws. The Company has made available to Parent true and cornplete copies
of the articles of incorporation, bylaws and limited liability company agleements (or equivalent
KE39423194
l0
Joint Application
Docket No. 16-057-01
Exhibit I.1
constituent documents) of each Subsidiary of the Company as in effect on the date of this
Agreement,
(c) Each of the Company and its Subsidiaries has all requisite entity power
and authority to enable it to own, operate, lease ol otherwise lrold its properties and assets and to
oonduct its businesses as presently conducted, except whele the failurc to have such power or
authority would not reasouably be expected to have a Compauy Material Adverse Effect.
Section3.2 Canitalization.
(a) 'i'he authorized capital stock of the Company consists of 500,000,000
shares of Cornpany Comrnon Stock, 5,000,000 shares of Class A preferred stock ("Class A.
jl1_{brlgdllggl!') and 5,000,000 shares of Class B pleferred stocl< ("ek$_B-Prefcued Stoc.k,"
and together with the Class A Prefelred Stoclc, the "Corlpal]f-lltqfcryed Stocl("). At the close of
business on January 26,2016, (a) 174,988,403 shares of Cornpany Common Stock were issued
and outstanding (including 279 Company Restricted Shares), (b) no shares of Cornpany
Prefemed Stock wete issued and outstatiding, (c) Company RSUs with respect to an agglegate of
595,151 shares of Company Common Stock were issued and outstanding (including shares of
Cotnpany Comnion Stoch issuable in t'espect of dividends declared through such date), and
(d) Cornpany Performance Share Awards with tespect to an aggregate of 286,711 shares of
Company Common Stock based on achievernent of applicable perfonnance criteria at target level
were issued and outstanding and (e) Company Stock Optiorrs with respect to an aggregate of
286,488 shares of Company Common Stock were issued and outstanding.
(b) All outstanding shares of Company Cornmon Stock are, arrd all shares of
Cornpany Cornmon Stocl< that rray be issued upon tlre settlement of Company RSUs and
Cornparry Performance Share Awards, and all shares of Cornpany Common Stock that may be
issued upon the exercise of Company Stock Options, wiil be, when issued, duly authorized,
validly issued, fully paid and nonassessable and not subject to, or issued in violation of, any
preemptive right. Except (x) as set forth in Section 3,2{b) of the Company Disclosure Schedule,
(y) as set folth in Section 3"2(a), or (z) pursuant to the tenns of this Agreernent, as of the date
hereof, there are not issued, reserved fol issuance or outstanding, and there are not any
outstanding obligatiorrs of the Company or any Subsidiary of the Company to issue, deliver or
sell, or cause to be issued, delivered or sold, (i) any capital stock of the Courpany or any
Subsidiary of the Company or any securitics of the Cornpany or any Subsidiary of the Company
convertible into or excliangeable or exercisable for shares of capital stock or voting securities of,
or other equity intelests in, the Company or any Subsidiary of thc Courpany or (ii) any waralrts,
calls, options or other rights to acquire frottr the Company or any Subsidiary of the Cornpany, or
any other obligation of the Company or any Subsidiary of the Company to issue, deliver or sell,
ol'cause to be issued, delivered ol sold, any capital stock or voting securities of, or other equity
interests in, the Company ot any Subsidiary of the Cornpany (the items specified in the foregoing
clauses (i) and (ii), collectively, "Equity Securities"). Except pursuant to the Company Stock
Plan, there ale not any outstanding obligatiorrs of the Cornpany or any Subsidiary of the
Company to repurchase, redeem or otherwise acquile any Equity Securities. Thele is no
outstandirrg Indebtedness of the Company having tlie Light to vote (ol convertible into, or
exchangeable for, securities having the right to vote) on any matters on rvhich shareholders of the
Cornpany may vote.
lt
KE 39473794
Joint Application
Dooket No. 16-057-01
Exhibit 1.1
(c) Section 3.2(c) of the Company Disclosure Schedule sets fofth a complete
and acourate list of each Company RSU, each Cornpany Performance Share Award, each
Cornpany Restricted Share, each Company Stock Option and each Company Award outstanding
as of the date of this Agreement.
Seetion3.3 Authoritv; Non-contravention.
(a) The Company has all necessary corporate power and authority to execute
and deliver this Agreement and, subject to obtaining the Company Shaleholder Approval, to
perform its obligatious hereunder and to consumtnate the Transactions. The Cornpany Board, at
a meeting duly called and held, unanimously adopted resolutions (i) deterrnining that it is in the
best interests of the Company and its shareholders for the Cornpany to enter into this Agleement,
(ii) approving the Company's execution, delivery and performance of this Agreernent and the
consumrnation of the Transactions and (iii) resolving to recommend that the shareholders of tlre
Company approve this Agreernent and the plan of merger set forlh in this Agreement and
dilecting that this Agreernent be subrnitted to the shareholders of the Company fot approval at a
duly held meeting of such shareliolders for such purpose (the "Cornpany floerd
Recomnrendntion"). A. of the date of tiris Agreernent, such resolutions lmve not been amended
or withdrawn. Except for obtaining the Company Shareholder Approval, no other corporate
action on the part of the Company is necessary to authorize the execution and delivery of and
perfonnance by the Company under this Agreement and the consummation by it of the
Transactions. This Agreement lras been duly executed and delivered by the Company and,
assuming due authorization, execution and delivery hereof by the other parties hereto, cotrstitutes
a legal, valid and binding obiigation of the Company, enforceable against the Cornpany in
accordance with its tenns, except that such enforceability (i) rnay be limited by bankruptcy,
insolvency, fiaudulent transfer, reorganization, rnolatol'iurn and othel similar laws of general
application affecting or relating to the enforcement of creditors' rights generally and (ii) is
subject to geueml principles of equity, whether considered in a proceeding at law or in equity
(the "Banlcruptcy and Equit.y Exception").
(b) The execution and delively of this Agreement by the Company does not,
and neither the consummation by tlie Company of the Transactions nor compliance by the
Company with any of the tems or provisions hereof will, (i) assuming the Company Slialeholder
Approval is obtained, conflict with ol violate any provision of the Company Chafter Documents
or olganizational documents of any Subsidiary of the Cornpany, (ii) assurning that each of the
consents, authorizations and approvals refemed to in llcction 3.4 and the Conrpany Shareholder
Approval are obtained (and ariy condition precedent to any such consent, authorization or
apploval has beerr satisfied) and each of the filings ref'erred to in Section 3.4 are made and any
applicable waiting periods referred to therein have expired, violate any Law applicable to the
Cor:rpany ol' any of its Subsidiaries or ary of theil respective properties or assets or (iii)
assuming that each of the consents and notices specified in Section 3.3(bXiii) of the Cornpany
Disclosure Schedule is obtained or given, as applicable, result in any breach of or constitute a
default (with or without notice or lapse of time, ol both) under', or give rise to any right of
temriuatiou, arrendment, acceleration ol canccllation of, or any right of first refusal under, any
Conrpany Material Contract to which the Company or any of its Subsidiaries is a party or by
which they or any of their respective properties ol assets may be bonnd, or under any Company
Pennit ol result in the cleation of a Lien (other than any Pelmitted Lien), upon any of tlie
w 39423794
12
Joint Application
Docket No. 16-057-01
Exhibit I .l
properties or assets of the Company or any of its Subsidiaries, other thau, in the case of clauses
(ii) and (iii), as would not reasonably be expected to have a Compary Material Adverse Effect.
Section 3.4 Govcnurtental Aptrroyals. Except for (a) the filing with the SEC of a
proxy statement, in prelirninary and definitive form, relating to the Cornpany Shareholders
Meeting (as amended or supplemented fi'om time to time, the "Proxy Statemet'rt"), and other
filirrgs lequired under', and oompliance rvitir other applicable requiletnents of, the Securities
Exchange Act of 1934 (the "llxchartge Ac!") and the rules of the NYSE in connection with this
Agteement and the Merger, (b) tiie filing of the Articles of Mergcr with the Division pursuant to
the URBCA, (c) approvals or filings (including notice filings) required under, and compliance
with other applicable requirements of, the PSCU, PSCW and PUCI (such approvals and filings
described in this clause (c), the "Reguirecl Statutory Alprovals"), (d) the approvals or filings set
forth on Section 3.4(d) of the Company Disclosure Schedule and (e) filings lequired under, and
cornpliance with othel applicable requirements of, the HSR Act, no consents or approvals of; or
filings (including notice filings), declarations or registrations with, any Goverrunental Authority
are necessary for the execution and delivery of this Agreement by the Cornpany and the
consummation by the Company of the Transactions, other than as would not reasonably be
expected to have a Company Matcrial Adverse Effect.
Section 3.5 .Comrrany $llC'Documcnts; Llndisclosed Liabilitics.
(a) The Cornpany, Questar Gas Company and Questar Pipeline Company
(collectively, the "&gplrdng_ee11pgp!:s") ltave filed with or furnished to the SEC, on a timely
basis, all registration staternents, reports, proxy statements and other documents ihat such
companies were required to file or furnish since January 1,2014 (collectively, and in each case
including all exhibits and schedules thereto and documents incorporated by reference thelein, as
such statements, repofts and documents may have been amended since the date of their filing, the
"Cornparry SllC_ D,;ru "). As of tireir respective effective dates (in the case of Company
SEC Documents that are registration statements filed pursuant to the requirements of the
Securities Act) and as of their respective filing dates (in the case of ail othel Cor:rpany SEC
Documents), or in the case of amendments thereto, as of tho date of the last such amendment, the
Company SEC Documents oomplied in all material respects with the requirements of the
Exchange Act, the Securities Act or the Sarbanes-Oxley Act of 2002 (thc "Sarbarss-Oxlsy
Act"), as the case may be, and the rules and regulations of the SEC promulgated thereunder,
applicable to such Company SEC Docurnents, arrd none of the Company SEC Documents as of
such respective dates (or, if amended, the date of the filing of such amendment, with respect to
the disclosures that are amended) contained any untrue statement of a material fact ol omitted to
state a material fact required to be stated therein or necessary to make the statements therein, in
light of the circurnstances under which they were rnade, not rnisleading.
(b) Except to the extent updated, amended, restatcd or corrected by a
subsequent Cornpany SEC Docurnent (but only amendments, restatements or cortections priol to
the date of this Agreement in the case of any Cornpany SEC Document with a filing ol effective
date prior to the date of this Agreernent), as of their respective dates of tiling with the SEC, the
financial statements (consolidated, as appiicable) of each of the Reportirrg Companies included
in the Cornpany SEC Documents (i) complied as to fornr in all material respects with all
applicable accounting requiretnents and with the published rLrles and regulations of the SEC rvith
K839423794
l3
Joint Application
Docket No. l6-057-01
Exhibit 1.1
respect theleto (except, in the case of unaudited statements, as perrnitted by Form 10-Q of the
SEC), (ii) lrave been plepaled in accordance with GAAP applied on a consistent basis during the
periods involved (except (A) as niay be indicated irr the notes theleto or (B) as pennitted by
Regulation S-X) and (iii) present failly, in all material respects, the financial position
(corrsolidated, as applicable) of each of tlie Reporting Companies and theil Subsidiaries, as
applicable, and the results of its operations and cash flows (corrsolidated, as applicable), as of
each of the dates and for the periods shown, as applicable, in conformity with GAAP.
(c) Each Reporting Company has established and maintains disclosure
controls and procedures and hternal control over fiuancial reporting (as such teuns are defined
in paragraphs (e) and (f), respectively, of Rule 13a-15 under the Exchange Act) as lequiled by
Rule l3a-15 under the Exchangc Act. Each Reporting Conrpany's disclosure controls and
procedures are reasonably desigrred to ensure that all material information requiled to be
disclosed by such Reporting Company in the reports that it files or furnishes under the Exchange
Act is recorded, processed, summarized and repofied within the time peliods specified in tlre
rules and forms of the SEC, and that all such material information is accumulated and
coulnunicated to such Reporting Company's management as appropriate to allow timely
decisions regarding required disolosure and to rnake the certifications required pursuant to
Sections 302 and 906 of the Sarbarres-Oxley Act, Based on its most recent evaluation of internal
control over financial reporting prior to the date hereof, the Company, for urd on behalf of eacl'r
Reporting Company, has disclosed to the Company's auditors and to the audit and finance
committee of the Cornpany Board (i) any and all "significant deficiencies" and "rnaterial
wealoresses" in the design or operation of internal control over financial reporting tirat are
reasonably likeiy to adversely affect, in any material rcspect, such Reporting Company's ability
to lepofi filancial informatiorr and (ii) any fi'aud, whether ol not material, tliat involves
management or other employees who have a significant role in such Repofting Company's
internal control over financial reporting, and any such deficiency, weakness and fraud so
disclosed, ifany, has been disclosed to Parent prior to the date hereof.
(d) None of the Reporting Cornpanies or any Subsidiary of auy Repolting
Company has any liabilities which would be required to be reflected or reserved against on a
balance sheet (consolidated, as applicable) of such Reporting Company prepared in accordance
with GAAP or the notes thereto, except for liabilities (i) reflected or leserved against on the
balance sheet of such Repofting Conipany and its Subsidiaries as of September 30,2015 (the
"llalancc Sheet Date") (including the notes thereto) included in the Company SEC Documents,
(ii) incurred after the Balance Sheet Date in the ordinary course of business consistent with past
practice, (iii) as contemplated by this Agreement or otherwise arising in comrection with the
Tlansactions or (iv) as would not reasonably be expected to have a Company Material Adverse
Effect.
(") All filings (other than irnmaterial filings) required to be made by the
Company or any of its Subsidiaries since January 1 , 2014 under applicable state or federal Laws
specifically govet'ning the regulation of public utilities, Environmental Laws, exploration and
production of Hydrocarbons and pipeline safety have, to the l(nowledge of the Company, been
filed or fulnished with the applicable Govenunental Authority (including all fonns, staterlents,
reports, agreernents (oral or written) and all docurnents, exhibits, amendments and supplements
appertaining thereto (colleotively, "l{egulalory_Iji!hgq")), and all such Regulatory Filings
KE 19423't94
t4
Joint Application
Dockct No. I6-057-01
Exhibit 1. i
complied, as of their lespcctive clates, with all applioable requirements of the applicable Laws,
except for Regulatory Filings the failure of whioh to mal<e or tlte failure of which to mahe in
cornpliarrce with all applicable requirenrents of the applicable Laws have not had and would not
reasorrably be expected to have a Company Material Adverse Effect.
Section 3.6 Absence of Certain Cha4ges. Fron January 7,2015 to the date of this
Agreement, (a) except in comection with the Transactions, the business of the Company and its
Subsidiaries has been conducted in all material respects in the ordiuary course of business
consistent with past practice and (b) there has not been any circunrstauce, development, change,
event, occurrence ol effect tliat has had or would reasonably be expected to have a Company
Material Adverse Effect.
Section 3.7 l,esal Proceedings. There is no pending or, to the Knowledge of the
Company, threatened, Claim against the Company or any of its Subsidiaries, nor is there any
injunction, order, judgment, ruling or decree imposed upon the Company or any of its
Subsidiaries, in each case, by or before any Govenrurental Autlrority, that would reasonably be
expected to have a Company Material Adverse Effect.
Section 3.8 Clomlrliance With Larvst Perrnits. The Cornpany and its Subsidiaries are
in cornpliance with all larvs, statutes, ordinances, codes, rules, regulatiorts, rulings, decrees,
judgments, injunctions and orders of Governmental Authorities (collectively, "Laws") applicable
to the Corapany or any of its Subsidiaries or by which any of theil properties or assets are bound,
except for instances of non-cornpliance as would not reasouably be cxpected to have a Company
MaterialAdverse Effect. The Conrpany and each of its SLrbsidiaries hold, and are in compliance
witir, all Iicenses, franchises, permits, cefiificates, approvals, variances, orders, registrations and
authorizations fiom Governrnental Authorities required by Law for the conduct of their
respective businesses as they are llow being conducted (collectively, "Comparry Permits"),
except as would not reasouably be expected to lrave a Company Material Adverse Effect. No
action or investigation is pending or, to the I(nowledge of the Cornpany, threatened to suspend,
rnodify, disallow payment under, cancel, revoke, remove or withdraw any material Company
Permit where such suspeusion, rnodification, cancellation, revocation, removal or withdrawal
would reasonably be expected to have a Company Material Adverse Effect. To the Knowledge
of tlre Company, 1lo facts or circumstances exist that would reasonably be expected to rnaterially
affect the ability of the Company arrd its applicable Subsidiaries to continue to provide service
following the expiration of any franchise agleement ol to renew any fi'anchise agreement, except
as would not reasonably be expected to have a Company Material Adverse Effect. To the
K-nowledge of the Company, there is no pending challengc or dispute regarding arrarrgements
among any of the Company and its Affiliates that would materially affect implernentation of the
Company's or any of its applicable Subsidiaties' drilling programs for the benefit of Questar Gas
Company's customers, except as would not reasonably be expected to have a Company Material
Adverse Effect.
Section 3.9 'I':rx iVlatter.s. Except for those matters that would not leasonably be
expected to have a Company Material Advelse Eff'ect:
(a) (i) each
caused to be timcly filed on its
KE39423794
of the Conrpany and its Subsidiaries has tirnely filed, or has
behalf (takirrg iuto accorrnt any cxtension of tirne within which to
15
Joint Application
DocketNo. 16-057-01
Exhibit 1.1
file), all Tax Returns required to be filed by it, arrd all suoir filed Tax Retums are comect and
complete; (ii) eaclr of the Company and its Subsidialies has duly paid or rnade provision for the
payment of all Taxes that have been irrcuu'ed or are due fi'orn thenr by Govemmeutal Authorities;
(iii) no deficiericy with respect to Taxes has been proposed, assefted or assessed against thc
Company or any of its Subsidialies which has not been fully paid ol adequately leserved in the
Compatry SEC Docurnents; (iv) no audit or other administrative or court proceedings are
pending with any Governmental Authority with respect to Taxes of the Cornpany or any of its
Subsidiaries, and r:o written notice thereof has been received; (v) neither the Cornpany nor any of
its Subsidialies is a party to or is bound by any Tax sharirrg, allocation or indemnification
agleements or arrangements (other tlian such an agleelnent or arrangement (A) exclusively
between or alnong the Company and any of its Subsidiaries or' (B) the primary pulposc of which
is trot the allocation or payment of Taxes); and (vi) neither the Cornpany nor any of its
Subsidiaries is a party to or bound by any advauce pricing agleement, closing agleement or other
similar agleement or ruling related to Taxes.
(b) within the past three (3) years, rreither the Company nol' any of its
Subsidiaries has distlibuted the stock of any corpomtion, or had its stoclc distributed, in a
transaction intended to satisfy the requirements of Section 355 of the Code.
(o) each of the Cornpany and its Subsidiaries has properly and timely
withheld or collected and timely paid over to the appropriate Governmental Authority (or each is
ploperly holding for such tirnely payrnent) all material amounts of Taxes required to be withheld,
collected and paid over by applicable Law.
(d) rreither the Cornpany nor any of its Subsidiaries has engaged in a
transaction that constitntes a "listed transaction" for purposes of Section 6011 of the Code and
the app I icable h'easury regulations promul gated thereunder,
(E) there are no material Liens for Taxes upon any asset of the Compauy or
any of its Subsidiaries other than Pennitted Liens (within the meaning of clause (a) of such
term).
(0 This .!pgqiolt-3.9, the penultirnate sentence of Sectiqn 3.10 and last
sentence of Section 3.14(e[iii) constitute the sole and exclusive representations and wananties
of the Cornpany regarding Tax rnatters.
(g) For putposes of this Agreement: (i) "IaxQ!" shall mean all federal, state,
local ol foreign taxes, charges, fees, imposts, levies ol other assessrnents, irrcludirrg all income,
gtoss receipts, franchise, estir-nated, altelnative mfurinum, add-on miniurum, sales, use, transfer,
value added, exciso, sevetance, stamp, customs, duties, real property, personal propefty, capital
stock, social security, uuemploynrent, payroll, ernployee or other withholding, or othel tax,
including any interest, penalties ol additions to tax irnposed by any Goverrmental Authority in
connection with any of the foregoing, and (ii) "'l'ax l{cturrrs" shall nlcan any return, rcport, clain-r
fol refund, estimate, information retuln or statement or other similar document relating to ol
required to be frled with any Governmental Authoriry with respect to Taxes, including any
schedule ot attachment thereto and any amendment thereof.
KE 39423794
16
Joint Application
DocketNo. 16-057-01
Exhibit Ll
Section 3.10 llmnlovee Bcn*fits M*ttet's. The Company has made available to Parent
correct and complete copies of (a) the current plau docurnent for each Cotnpany PIan, (b) the
most recent annual reports on Form 5500 required to be filed with the Department of Labor with
respcct to each Company Plan (if any such report was required), (") the most recent sulrmary
plan descliption for each Company Plan for wl'rich suclr summary plan description is requiled,
(d) the rnost recent actualial reports atrd financial statements for each Company PIan, if
applicable, and (e) each trLrst agreement relating to any Company Plan. Each Company Plan is in
compliance with its terms and the applicable provisions of ERISA, the Code and all other
applicable laws, except where such noncompliance would not reasolrably be expected to have a
Cornpany Material Adverse Effect, There are uo pending ot, to the l(nowledge of the Company,
threatened claims (othel than claims for benefits in the ordinary course) with respect to any
Company Plans that would reasonably be expected to have a Company Material Adverse Effect.
There lras been no non-exempt prohibited transaction. (as defined in Seoiion 4975 of the Code or
Section 406 of ERISA) or breach of fiducialy duty under Section 404 of ERISA with rcspcct to
any Company Pian, other than as urould not reasonably be expected to have a Cornpany Material
Adverse Effect. All required material contributions to all Company Plans (including all
minirnurn required contributions under Sections 412 and 430 of the Code witir respect to any
Company Plan set forth on $ection .1,10(a) of the Cotrpany Disclosure Schedule) have been
made. All Company Plans that are "enrployee pension plans" (as defined in Section 3(3) of
ERISA) that are intended to be tax qualified under Section 401(a) of the Code (each, a
'"eoupary_llgrr$gtp_lla!.") have received a favolable detennilation letter fi'orn the IRS ot lras
filed a timely application therefor and, to the Knowledge of the Coinparly, r'ro condition exists
that could reasonably be expected to result in the loss of any such plan's qualified status. The
Company has made available to Parent a correct and cornplete copy of the most recent
determination letter received with respect to each Company Pension Plan, and a conect and
complete copy of each petrding application fol a determination letter, if any. Neithcr the
Company nor any ERISA Affiliate sponsors, maintains or contributes to, not has any liability
with respect to, a multiernployer plan (as defined in Section 3(37) of ERISA) or, except as set
forth on,Sectiofr I.l0(a) of the Company Disclosure Schedule, a plan subject to Section 102 or
Title IV of ERISA or Section 412 of the Code. Witlr respect to any plarr set forth on Seclion
3.10(a) of the Cornpany Disclosule Schedule, tlte Petrsiou Benefit Guaranty Corporation (the
"PB.Q,Q") has not instituted proceedings to tenninate any such plan (and, to the Knowledge of the
Comparry, no condition exists that could reasonably be expected to result in such proceedings
being instituted) and the Company and its ERISA A1'filiates do not have any material liability to
the PBCC with respect to such plan other than premiurn payments required by ERISA. Other
than as set forth on Secliq.n-3.10$) of the Con-rpany Disclosure Sclredule, no Company PIan
provides for post-ertrployment healtli or life insurance benefits, other than as lequiled by
COBRA or other applicable Laws. Witlr lespect to any plan set fofth on Sectio-.rt3.iO(tr) of the
Cornpany Disclosure Schedule, to the Knowledge of tire Company, the Company has the right to
amend or terminate sucli plan in its discretion without the consent of any participant. Except as
set forlh r:n Sectiorr 3.10[c_) of the Company Disclosure Schedule or as otherwiso required by this
Agleernent, thc consummation of the Transactions will not, either alone or in combination witir
another event, (i) entitle aay employee of the Cornpany to severance pay or any other payment or
(ii) accelerate the tirne of payment or vesting or increase the amount of compensation due any
such employee or officer'. No amounts payable under the Company Plans will fail to be
deductible fol federal income tax purposes by virtue of section 280G of the Code. This Section
l7
t<E 39423794
Joint Application
DocketNo. 16-057-01
Exhibit l.l
3.10 constitutes the sole and exclusive lepresentation and warral'rty of the Cornpany regarding
pension and employee benefit or liabilities or obligations, or compliance with Laws, relating
thereto.
Section 3.11 Environmer.rtal Matters. Excepl for those matters that would not
reasonably be expected to have a Cornpany Matelial Adverse Effect, (a) each of the Company
and its Subsidiaries is and for the last three (3) years has been in compliance with all appiicable
Envilonmental Larvs, which compliance includes obtaining, maintaining or complying witli all
Company Permits lequired under Environmental Laws for the operation of their respective
businesses, and all such Company Permits are valid and in full force and effect, (b) (i) thele is no
Clairn relating to or arising under Envirorunental Laws (including, relating to or arising frotn the
Release, threatened Release or exposure to any Hazardous Material or alleging violation of or
challenging the validity of any envirorrmental Company Pennit) that is pending or, to the
Klowledge of the Company, threatened against the Cornpany or any of its Subsidiaries, or any
leal ploperty currently owned, operated or leased by the Cornpany or any of its Subsidiaries, and
(ii) to the Ifuowledge of the Con-ipany, there is no Claim relating to or arising under
Environmerrtal Laws (inoluding relating to ol arising fiom the Release, threatened Release or
exposure to any Hazardous Material) that is pending or tlueatened against any real property
fomrerly owned, operated or leased by the Cornpany or any of its Subsidiaries, (c) neither the
Cornpany nor any of its Subsidiaries has received any written notice of, or entered into any order,
settlement, judgment, injunction or decree involving uncompleted, outstanding or unresolved
liabiiities ot corrective or remedial obligations relating to or arising urider Envii-onmental Laws
(including relating to ol arising florn the Release, threatened Release or exposul'e to any
Hazardous Matelial) and, to the Knowledge of the Cornpany, there are no facts or conditions
relating to the Company's or any of its Subsidiades' propelties, operations or Systerns that
would reasonably be expected to give rise to any such liability ol corrective or remedial
obligation, (d) there have been no ruptures, explosions or contaminations in the Company's or
any of its Subsidiaries' Systems that have resulted irr personal injury, loss of life or propelly
datnage, except to the extent any Claims related to the foregoing have been resolved, and
(e) there are no defects, corosion or other damage to arly of the Company's or any of its
Subsidiaries' Systems that would reasonably be expected to result in a pipeline integrity failure,
and the Company and its Subsidiaries are in compliance in all material respects with all
appropriate inspection and recordlceeping requirements required by applicable Envit'oruneutal
Laws. Seotir:rr 3.4, S*ction 31, $p_Cli"et1_3-.6 and this Section 3.1 1 constitute the sole and exclusive
tepresentations and warranties of the Company regarding environrnental matter:s, including all
matters arising under Envirorulental Laws.
Section 3.12 Intullurturlj Plorlerty. Except as would not reasonably be expected to
have a Company Material Adverse Effect, (a) (i) the Corrpany and its Subsidiaries have
suffrcient lights to use all material hrtellectual Property used in their respective businesses as
cuu'ently conducted and the conduct of the Company's and its Subsidiaries' businesses as
cumently conducted do not infringe or otherwise violate any Persou's Intellectual Properly and
(ii) there is no Claim of such infringement or other violation pending, or to the Knowledge of the
Company, tlrreaterred irr wliting, against the Corapany or its Subsidiaries, and (b) (i) to the
Knowledge of the Company, no Person is infi'inging ol otherwise violating any Intellectual
Property owned by the Company or its Subsidiaries and (ii) no Clairrs of such infringeurent or
other violation are pending or threatened in writing against any Person by the Company. This
KE 39473794
18
Joint Application
Docket No. 16-057-01
Exhibit 1.1
Section 3.12 constitutes the sole and exclusive representation and walranty of the Company with
lespect to any actual or alleged infringement or other violation of any Intellectual ProperLy of
any other Person.
Section 3,13 Trkeover St*tutesl llighfs PIan. Assurning that the representations and
warranties of Parent and Metger Sub set forth in $etjglf_ 4.7 are true and correct, the
Transactions are not subject to the Utah Control Shares Acquisition Act or any other sirnilar anti-
takeover Law (each, a "Tqkeovgr Stalute") or any sirnilar provision in the Cornpany Charter
Documents, The Company and its Subsidiaries do not have in effect any shaleholder rights plan,
"poison pill" or other similal plan or alTangement.
Section 3.14 llrepertiq.$ and A$r+ts,
(a) Except as would not reasonably be expected to liave a Company Matetial
Adverse Effect, the Company or a Subsidiary of the Cornpany owns and has either good and
valid title in fee or a valid leasehold interest, Right of Way or other rights to the land, mineral
and other subsurface rights, buildings, structures and other improvements thereon and fixtures
thereto necessary to permit it to conduct its business as cu'r'ently conducted, in each case fi'ee
and clear of a1l Liens (except in ail cases for Perrnitted Liens). Except as would not reasonably
be expected to have a Cotnpany Material Adverse Effect and except as may be lirnited by the
BanJcruptcy and Equity Exceptiou, all leases, Rights of Way or other agreements under wliich the
Cornpany or any of its Subsidiaries lease, access or use any real property are valid, binding and
in full force and effeot against the Company or any of its Subsidiaries and, to the Knowledge of
the Company, the countetparties thereto, in accordance with tJreir lespective terms, and neither
the Company nor any of its Subsidiaries are in default under any of suoh leases, Rights of Way
or other agreements.
(b) Each of the Company and its Subsidiaries has such corrsents, easements,
rights of way, permits and licenses (collectively, "&iqlrts of Wqy") fiom each person as are
sufficient to conduct its business as currcntly conducted, except for such Rights of Way the
absence of which have not had and would not reasonably be expected to have a Company
Material Adverse Effect. Each of the Company and its Subsidiaries has fulfilled and performed
all its material obligations witb respect to such Rights of Way and conducts their business in a
matlrler that does not violate any of the Rights of Way, and no event has occurred that allows, or
after notice or lapse of time would allow, revocation or termination thereof or would result in
any impairment of the rights of the holder of any such fughts of Way, except for such
revocations, terminations and impairments that have not had and would not reasonably be
expected to have a Company Material Adverse Effect. All pipelines owned ol opelated by the
Cornpany and its Subsidiaries are subjectto Rights of Way, there are no encroachments or other
encumbrances on the Rights of Way that materiaily affect the use theteof and thele are no gaps
(including any gap arising as a result of any bleacir by the Company or any of its Subsidiaries of
the terms of any Rights of Way) in the Rights of Way other than gaps that would not have and
would not leasonably be expected to have a Company Material Adverse Effect.
KD 39423194
(c)
19
Joint Application
Docket No. 16-057-01
Exhibit 1.1
(i) Except as would not reasonably be expected to have a Company
Material Adverce Effect, the Cor:rpany and its Subsidiaries, as applicable, have good and
defensible title to all of the lntelests except for such Intelests sold, used, fanned out or
otirerwise disposed of since December 37,20L5 in the ordinary course of busiless, fi'ee
and cleal of all Liens and Ploduction Burdens other than Production Burdens not yet
eamed, due or payable and Peunitted Liens. Except as would not reasonably be expected
to have a Cornpatiy Material Adverse Effect or as set forth on 5Sg!lglt_3_.-l-4{g)t!l of the
Company Disclosure Schedule, (i) all proceeds fi'om the sale of Hydrocarbons produced
frotn the Interests are being received by them in a timely manner and are not being held
in suspense for any reason and (ii) thele are no calis on production or preferential rights
to purchase Hydrocatbons and neither the Cornpaly nor any of its Subsidiaries is
obligated to deliver Hydlocarborls or proceeds fiorn the sale thereof at a future point in
tinre without rece iving paymerlt therefor at or after the time of delivery. Except as would
lrot reasorrably be expected to have a Company Material Adverse Effect, the Cornpany
and each applicable Subsidiary (A) are in cornpliance with all valuation agreements, and
settlement agleements with respect to Ploduction Burdens, and (B) have paid or will
cause to be paid when due all Ploduction Burdens with respect to the Interests and each
other loyalty, Tax ol similal paylnent.
(iD AII of the wells owned, Ieased, operated or used by the Company
and its Subsidiaries and all watcr, carbon dioxide or injection wells located on any
property owned, Ieased, opcratcd or used by the Company and its Subsidiaries or
otherwise associated rvith an Intelest of the Cornpany or its Subsidiaries have been
drilled, complctcd and operated within tl,e Iimits permitted by the applicable Contract
granting such rights and applicable Law, and all drilling and cornpletion (and plugging
and abandorulent) of such wells and all related development, ploduction and other
operations have beeu conducted itr con:piiatrce with all applicable Laws except, in each
oase) as would not leasonably be expected to have a Company Matelial Adverse Effect.
To the Knowledge of the Comparry, no well owned, leased, operated or used by the
Corrpany or any of its Subsidiaries ale subject to material penalties on allowables
because of overproduction or violation of any applicable Law.
(iii) All Interests operated by the Company and its Subsidiaries have
been operated in accoldance with reasonable, prudent field practices and in compliance
with the applicable Contracts, except where the failure to so operate would not
reasorrably be expected to have a Company Material Adverse Effect. None of tlre
Interests of the Cornpany or its Subsidiaries is subject to any preferential purchase,
consent or similar right that would become operative as a lesult of the Transactions,
except for any such preferential purchase, consent or sirnilar rights that would not
reasonably be expected to have a Company Material Adverse Effect. Except as set fofth
on Section 3.14(cXiii) of the Company Disclosure Schedule, none of the Interests of
Conrpany or its Subsidiaries are subject to any Tax paftnership agreernent or provisions
requiring a paftnerslrip income Tax Return.
(d) To tlre I(rowledge of the Company, there are no uiatelial inaccuracies in
tlre Wexpro Reserves Repoft, dated .lanuary 28,2076, a correct and complete copy of which the
Company has rnade available to Parent pliol to the date of this Agreenrent.
t<E 39423794
20
Joint Application
Docket No. l6-057-01
Exhibit I .l
Section3.l5 Contracts.
(a) For purposes of this Agreement, "Corrpany Material Contract" means
(i) any Contract which is required to be filed by any Reporting Company as a "material contract"
pursuant to Item 601(b)(10) of Regulation S-K under the Securities Act or (ii) any Contract,
including any joint development or operating ag'eement, partnership or other similar agt'eement
or alrangement, any gathering, processing, development, production, cost-of-selvice or similal
agreernent, including agreements between Questar Gas Company and Wexpro Company, any
futures coiltract, option contract or other derivative transaction, any transpoftatiorr or storagc
contract, any Contract relating to the Company's ol its Subsidiaries' Interests, any throughput
contract ol any agreement relating to Indebtedness, that relates to or involves futule
expenditures, receipts or payments by the Cornpany or arly of its Subsidiaries of more tharr
$40,000,000.00 in any one (1) yearperiod that carrnot be terminated on less than 90 days notice
without rnaterial payment or penalty, Except for any Company Material Contract that has been
filed by the Company as a "matel'ial contract" pursuaut to Itern 601(b)(10) of Regulation S-K
under the Securities Act, each Coinpany Material Contract is set forth on Scction 3.15 of the
Company Disclosure Schedule.
(b) Each Cornpany Material Contract is valid and binding on the Cornpany
and any of its Subsidiaries to the extent the Cornpany or such Subsidiary is a party thereto, as
applicable, and, to the I(rowledge of the Cornparry, each other party thereto and is in full force
and effect and enforceable in accordance with its terms (subject to the Bankruptcy and Equity
Exception), except where the failure to be valid, binding, enforceable and in full force and effect,
would not reasonably be expected to have a Conrpany Material Adverse Effect. The Company
and each of its Subsidiaries, and, to the I(:owledge of the Cornpany, any other party thereto, (i)
has pelfonned all obligations required to be perfouned by it under each Company Material
Contract, except where such noncompliance would not reasonably be expected to have a
Company Material Adverse Effect, and (ii) has not received auy tvritten notice of material
breaclr, violation, default, suspension, modification, cancellation, revocation, removal,
withdrawal or disallowattce of payment under or with lespect to any Company Material Contract,
Section 3.16 Labor, Neither the Company nor any of its Subsidiaries is party to any
collective balgaining agreement. As of the date of this Agreement, flrere is no labor strike,
lockout or worl< stoppage, or, to the Knowledgc of the Company, thleat thereof, by or with
respect to any ernployee of the Company ol' any of its Subsidiaries, except where such stril<e,
lockout or work stoppage would not teasonably be expected to have a Courpauy Material
Adverse Effect. There are rto actions, charges or investigations pending or, to the l(nowledge of
tlie Cornpany, tirreaterred by or on behalf of any employee or labor organization alleging
violations of local, state or federal Laws relating to eurploymerrt or labor practices, except as
would not reasonably be expected to have a Company Material Adverse Effect.
Section 3.17 9nirriou of Fin4ncial Advisor, Tlre Company Board has received the
opinion of Goldrnan, Sachs & Co., dated as of thc date of this Agreement, to the effect that, as of
such date, and subject to the various assurnptions and qualifications set forth therein, the Merger
Consideration to be received in the Merger by holdels of the Company Common Stock is fair
fi'om a financial point of view to the holders of the Company Comurorr Stoch.
t<E 39423't9+
2t
Joint Application
Dockct No. 16-057-01
Exhibit 1 .l
Section 3.18 Brohers and Other Advisors. Except for Goldrnan, Sachs & Co., no
broker, investment banlcer, finaucial advisol ol other Person is entitled to any broker's, finder's,
financial advisor's or other similar fee, in connectiorr with the Transactions based upon
arrangements made by or on belialf of the Cornpany or any of its Subsidiaries.
Section 3.19 Companv Sharcholder Annrov+l. Assuming the accuracy of the
representations and waranties of Parent and Merger Sub set forth in Sectiort 4.7, approval of this
Agreement by tlie affirmative vote (in person or by proxy) of the holdels of a majority of the
outstanding shares of Company Common Stock entitled to vote at the Cornpany Shareholders
Meeting (the "Conrlrarry Shareholder Approval") is the only vote or approval of the holders of
any class or sef ies of capital stock of the Cornpany necessary to approve this Agreement and the
Transactions.
ARTICLE TV
&trPRESENTATI9N$ AND WAIUITTNTIII$j OF I'ARtrNT ANI) MEI{GIIR IiI"lB
Except as set fofth in any of the Parent SEC Documents publicly available at least
twenty-fbur (24) hours prior to the date of this Agreement, but excluding any risl< lactor
disclosule under the headings "Risk Factols" or' "Forward Looking Statements", Parent and
Merger Sub jointly and severally replesent and warrant to the Cornpany as follows:
Section 4.1 Organization. Standing and Corporate Porver. Parent is a colporatiotr
duly organized, validly existing and in good standing under the Laws of the Conunonwealth of
Vilginia, and N4erger Sub is a corporation duly organized, validly existing and in good stauding
under the Laws of the State of Utah. Each of Parent and Merger Sub lias all r'equisite coqporate
power and authority nccessaly to own or lease all of its properties and assets and to carry on its
business as it is now being conducted. Palent is duly qualified to do business and is in good
standing in each jurisdiction in which the nature of the business conducted by it or the character
or location of the properties and assets owned or leased by it makes such qualification necessary,
except where the failure to be so qualified or in good standing would not reasonably be expected
to have a Parent Material Adverse Effect.
Section4.2 Aulhorityl Noncontravcution,
(a) Each of Parent and Melger Sub has all necessary corporate power and
authority to execute and deliver this Agreernent, to perfonn their respective obligations
heteunder and to consummate the Transactions. The execution and delivery of and perfounance
b), Parent and Merger Sub under this Agreernent, and the consumrnation by Parent and Merger
Sub of the Tlansactions, have been duly authorized and approved by all necessary corporate
action by Parent and Merger Sub (including by the Parent Board and the board of directors of
Merger Sub) and approved by Parent as the sole shareholder of Merger Sub, and no other
corpolate aclion on the parl of Parent and Merger Sub is necessary to authorize the execution and
dclivery of and performance by Parent and Merger Sub under this Agreemerrt and the
consummation by them of the Tlansactions. This Agleement has been duly executed and
delivered by Parent and Merger Sub aud, assurning due authotization, execution and clclivery
hereof by the Company, constitutes a legal, valid and binding obligation of each of Parent and
I(E 39423794
22
Joint Application
Docket No. 16-057-01
Merger Sub, enforceable against each of them in accordance with its terms, subject to the
Bankruptcy and Equity Exceptiotr. No vote or approval of the holders of any class or series of
capital stock of Parent is necessary to adopt or approve this Agreernent arrd the Transactions.
(b) The execution and delivery of this Agreement by Parent and Merger Sub
do rrot and neither the consutnmation by Parent or Merger Sub of the Transactious, nor
cornpliance by Parent or Merger Sub with any of the terms or provisions hereof, will (i) conflict
with orviolate anyprovision of the articles of incorporation and bylaws of Parent, in each case
as amended to tlre date of this Agreement, (ii) assurring that each of the consents, authorizations
and approvals referred to in Section 4.3 (and any condition precedent to any such consent,
authorization ol approval has been satisfied) is obtained or given, as applicable, and each ofthe
filings refened to in Sqctiorl 4.3 are made and any applicable waiting periods refeued to thereirr
have expired, violate any Law applicable to Parent Merger Sub or any of their respective
Subsidiaries or any of their respective properties or assets or (iii) result in any breach of, or'
constitute a default (with or without notice or lapse of time or both) under, or give rise to any
right of tennination, arnendtnent, acceleration or cancellatiorr of, any Contmct to which Parent,
Merger Sub or any of their respective Subsidiaries is a party or by which they ol arry of their
respective properties or assets may be bound, except, in the case of clauses (ii) and (iii), as would
not reasonably be expected to lrave a Parent Material Adverse Effect.
Section 4,3 Governmental rlprrrovals. Except for (a) the filing with the SEC of the
Proxy Statement, in preliurinary and definitive fonn, and other filings requi:,ed under, and
compliance witlr other applicable requirements of the Exchange Act and the rules of the NYSE
in connection with this Agreement and the Merger', (b) the filing of the Articles of Merger with
the Division pursuant to the IIRBCA, (c) the Required Statutory Approvals and (d) filings
required under, and cornpliance with other applicable requirements of, the HSR Act, no consents
or approvals of, ol filings, declarations or registrations with, any Goverrunental Authority are
necessary fol the executiotr and delivery of this Agreement by Parent and Melger Sub and the
consummation by Parent and Merger Sub of the Transactions, other than as would not
reasonably be expected to have a Parent Material Adverse Effect.
Section 4.4 llrol<ers and Other Advisol's,, Exoept for fees which will be paid by
Parent, no broker, investtnent banker, financial advisor or other Persoir is entitled to any
brolcer's, finder's, financial advisor's or othel similar fee, in connection with the Transactions
based upon arrangements made by ol on behalf of Parent or any of its Subsidiaries,
Section 4.5 OrvncrshiB nnd Oporittious ol'Nlgrser Suh. Parent owns beneficially
and of record all of the outstanding capital stocl< of Merger Sub, ali of whicli is duly authorized,
validly issued, fully paid and uon-assessable. Merger Sub was fonned solely for the purpose of
engaging in tlie Transactions aud such other purposes as are specified in Merger Sub's afficles of
incorporation. Merger Sub has no assets, liabilities or obligations aud, since the date of its
formatiou, has not engaged in any busincss activities or conducted any operations except iu eaclr
case as arising from the execution of this Agreement and the pelformance of its covenants and
agrecments Ireleunder.
Section 4.6 Sullficierrt Fuutls. Parent has, and shall have available at and at all tirnes
prior to and at the Effective Tirre, sufficient cash and cash cquivaients arrd other sources of
KE 39423794
23
.loint Application
Docket No. I6-057-01
llxhibit 1 .1
imrnediately available funds to deliver the aggregate Merger Consideration atrd make the
payments lequired under $cction ?.3, and any other amounts irrcurred or otherwise payable by
Parent, Merger Sub or the Surviving Coqporation in connection with the Transactions (such
sources being collectively refened to herein as the "'l'ransirction F'inancing"), and there is no
restriction on the use of such cash for such pul'poses. Parent has the financial lesoutces aud
capabilities to fully perfonr: its obligations under this Agreement. Parent and Merger Sub
aclarowledge and agree that their obligations hereunder are not subject to any conditions
legarding Parent's, Mergel Sub's or any other Person's ability to obtain financing for the
consummation of the Transactions.
Section 4.7 Share Owner:shin. Neither Parent nor Mergel Sub is, individually or, to
Parent's l(nowledge, together with its "affiliates" and "associates" (as such terms are def,rned in
Rule l2b-2 of the Exchange Act), a "beneficial owner" (as such telm is defined in Rule l3d-3 of
the Excliange Act) of a number of shares of Cornpany Common Stock equal to or greater than
five percent (5%) of the total number of issued and outstanding shares of Cornpany Comtrotr
Stocl<.
Section 4.8 Lesal Prcceetlirrss. There is no pending or, to the Knowledge of Patent,
thleatened, Clairn against Parent, Merger Sr.rb ol any of theil lespective Subsidiaries, nor is there
any injunction, order, judgrnent, ruling or decree irnposed upon Parent, Mergei' Sub or any of
their respective Subsidialies, in each case, by or before any Govemmental Autholity, that would
reasonably be expected to have a Parent Material Adverse Effect.
Section 4.9 Non-Reliance on Conroury Bstiruates. Proiections. Iiir{ccasts,
Fonvald-Lo$ling fitafenren(s anll Brrsiness Plans. ln connection with the due diligence
investigation of the Company by Parent and Merger Sub, Parent and Merger Sub have received
and may continue to receive from the Company certain estimates, plojections, forecasts and
other forward-looking infonnation, as well as ceftain business plans and cost-r'elated plan
information, regarding the Cornpany, its Subsidiaries and their respective businesses and
operations- Parent and Merger Sub hereby acknowledge that there are uucettainties inherent iu
attempting to make such estimates, plojections, forecasts and other forward-looking infbrmation,
with which Parent and Merger Sub are familiar, that Parent and Merger Sub are rnal<ing their
own evaluation of the adequacy and accuracy of all estirnates, projections, forecasts and other
folwardlooking infonnatiou, as well as such business plans and cost-related plans, furnished to
thern (including the reasonableness of the assumptions under'lying such estimates, projectious,
forecasts, forward-looking information, business plans or cost-r'elated plans), and that neither
Parent nor Merger Sub has relied upon the Cornpany or any of its Subsidiaries, or any of their
lespective shareholdels, dircctors, officers, employees, Affiliates, advisors, agents or
representatives, ol any other Person, with respect thereto. Accordingly, each of Parent and
Merger Sub hereby acknowledge that neither the Cornpany nor any of its Subsidiaries, nor any of
theit lespective shaleholders, directols, officels, employees, Affiliates, advisors, agents or
rept'esentatives, nor any othel Person, has made or is making any tepresentation or warranty ot'
has or shall have any liability (whether pursuant to this Agleement, in tod or otherwise) with
fespect to such cstimates, projections, forecasts, forward-lool<ing informatiorr, business plans or
cost-related plans (including the reasonableness of the assurnptions underlying such estimates,
projections, forecasts, forward-looking iufonnation, business plaus or cost-r'elated plans), except
as expressly set fodh in Article III of this Agreement.
KE ]9423'194
24
Joint Application
Dockct No. 16-057-01
Exhibil 1.1
ARTICLE V
COVENANTS
Section 5.1 Conduct of Business.
(a) Except as contemplated or permitted by this Agreement, as required by
applicable Laws, as contemplated by any of the matters set folth in Section 5.1(q) of the
Company Disclosure Sclredule, or witlr the prior written consent of Parcnt (which consent shall
trot be unreasouably withheld, delayed or conditioned), during the period frorn tlie date of this
Agreement until the earlier of the Effective Tirne and the termination of this Agreernent in
accordance with Article VII, (x) the Company shall, and shall cause each of its Subsidiaries to,
use reasonable best efforts to conduct its business in ail tnaterial respects in the ordinary coul'se
and to preserve intact its present lines of business, maintain existing levels of insurauce, tnaintain
its lights and fi'ancirises and preserve satisfactory telationships with Governmental Authorities,
employees, custorners and suppliers, and (y) the Conrpany shall not, and shall uot permit any of
its Subsidiaries to:
(i) issue, sell, or grant any shares of its capital stock, or any securities
or rights convertible into, excharrgeable or exercisable for, or evidencing the right to
subscribe for any shares of its capital stock, or any rights, warrants or options to purchase
any shares ofits capital stock, or any securities or rights converlible into, exchangeable or
exercisable for, or evidencing the right to subscribe for, any shales of its capital stocl<,
except as set forth on Seclion 5.1(.aXi) of the Company Disclosure Sciredule or tlre
issuance of True-Up Shares;
(iD redeem, putohase or otherwise acquire any of its outstanding
shares of capitai stock, or any rights, warrants or options to acquire any shares of its
capital stock, except (A) pursuant to Company Material Contracts set forth on Section
5.1(a)fii) of the Corrpany Disclosure Schedule in effect as of the date hereof or (B) in
connection with withholding to satisfu Tax obligations with respect to Cornpany RSUs,
Cornpany Performance Share Awards, Cornpany Restricted Shares, Cornpany Stock
Options or Company Awalds, acquisitiorrs in connection with the forf'eiture of equity
awaLds, or acquisitions in connection with the settlement of Company RSUs, Company
Pelformanoe Shale Awards or Conrpany Awards, vesting of Cornpany Restricted Shares
or the exercise of Cornpany Stock Options;
(iiD (A) declare, authorize, set aside for payntent ot pay any dividend
on, or make any other distlibution in respect of, any shares of its capital stock, otirer thau
(1) dividends paid by any Subsidialy of the Company to tlre Cotnpany or to any wholly-
owned Subsidialy of the Company, (2) quarterly casli dividends with respect to the
Company Common Stock not to exceed the current amual per shale dividend rate by
more than $0.04 per year, rvith record dates and payment dates consistent with the
Company's clllrerlt dividend practice, or (3) a "shrb period" dividend to holders of record
of Company Common Stock as of irnmediately prior to the Effective Tirne equal to the
product of (x) the number of days from the record date for payment of the Iast quarter'ly
dividend paid by the Company pliol to the Effective Tirne, rnultiplied by (y) a daily
t<E 39A23',194
25
Joint Application
Docket No. 16-057-01
Exhibit I .l
dividend rate deterrnined by dividing the amount of the last quarterly dividend prior to
the Effective Tirne by ninety-one (91) or (B) adjust, split, con,bine, subdivide or
reclassify any shares of its capital stock;
(iv) incur any lndehtcdncss in an outstanding plincipal arnount in
excess of$200,000,000 in the aggregate in any calendar yeat, except for lndebtedness (1)
incured to replace, lenew, extend, refurance ol refund any existing Iudebtedness, in the
same principal amount of such existing Indebtedness and upon the maturity of suclr
existing Indebtedness, in each case on tenls that can be redeemed or prepaid at any time
upon payrnent of the outstanding ptincipal alnount plus accrued interest without any
rnake-whole or similar prepayment penalty (2) foL borrowed money incurled pulsuant to
(and up to the maximum amount permitted under) any Company Material Contract
lelating to lndebtedness as in effect as of the date of this Agreernent, or (3) arnong the
Cornpany and any of its wholly-owned Subsidiaries or among any of suclr wholly-owned
Subsidiaries; provided no such Indebtedness incured after the date of this Agreernent
shall contain any tenn that would accelerate the payment thereof ol require its irunediate
lepayment due to the transactions contemplated by this Agreement.
(v) sell, di.spose of, abandon, encuurber', trarrsfer, falr-out, lease or
license any of its properlies or assets that are material to the Company or any of its
Subsidialies, except (A) immatelial transactions in the ordinary course of business, (B)
pursuant to Company Material Contlacts in force on the date of this Agreement, (C)
dispositiorrs of inveutory, equipment or other as.sels that al'e l1o longer used or useful in
the conduct of the business of tlie Cornpany or ally of its Subsidiaries, @) transfers
among the Conrpany and its Sr:bsidiaries or (E) in respect of the items set forth in $ection
5. i(0, below, or on Section 5.1 (aXv) of the Cornpany Disclosure Schedule;
(vi) make capital expenditures, except for capital expenditures
budgeted in the Company's cuuent long term plan that was made available to Parent
prior to the date hereof, which such capital expenditures shall not be in excess of
$375,000,000 in the aggregate for the Company and its Subsidiaries taken as a whole
during any calendar yeal'(p]U a 10% variance), excluding any acquisition expenditures
perrnitted pursuant to Section 5. 1{a)(vii);
(riD make any acquisition (including by rnerger) of, ol investments in,
the capital stock, equity securities, mernbership interests ol a material portiou of the
assets of any other Pel'son, for consideration in excess of $50,000,000 in the aggregate in
any calendar yeal', excluding any capital expenditules pennitted pursuant to Section
5.1(aXvi);
(viii) (l) increase in auy respect the compensation of any of its directors
or employees (provided that payments of bonuses and other grants and awards made in
the ordinary coul'se of business consistent with past practice shall not constitute an
increase in compensation), except (A) as lequiled pursuant to applicable Law or the tenns
of Company Plans or other employee benefit plans ol arrangernents in effect on the date
of this Agreelnent and (B) iDcreases in salades, wages and benefits of employees and
director fees made iu the ordirrary coutse of business consistent with past practice or (2)
t<E 39423't94
26
Joirrt Application
Docket No. 16-057-01
Exhibit I .1
entet into ally ltew individual employment or seve[arrce agreelxent or materiaily amend
any such agreement other than entry into severance agreetneuts with tentrinated
employees in exchange for a release of claims and in the ordinary course of business
consistent with past practices;
(ix) adopt or amend auy Company Plan or arnend the Company's
Dividend Reinvestment and Stock Purchase PIan, as amended aud restated August 1,
2011, except as required by Law or for immaterial or ministerial amendrnehts;
(x) make any material change to its metliods of accounting, except as
required by GAAP (or atry intelpretation tl.rereof), Regulation S-X of the Exchange Act,
as required by a Governmental Authority or quasi-Govemmental Authority (including the
Financial Accounting Standards Board or arly similar organization) or as required by
applicable Law;
(*D amend the Company Charter Documents or organizational
docurnents of arry Subsidiary of the Company (except for immaterial or rninistcrial
amendments);
(xii) adopt a plan or agreement of cor-nplete or partial liquidation or
di ssolution or other re-organization;
(xiii) enter into, modiff or amend in any material respect, or telminate or
waive any material right undet', any Company Material Conttact, cxcept for (1) any new
agreement, modification, ameudment, termination or waiver irr the ordinary course of
business consistent with past practice or (2) a termination without rnaterial penalty to the
Company or any of its Subsidiaries;
(xiv) waive, release, assign, settle or compromise any material Claim
against the Cornpany or any of its Subsidiaries, other than waivcrs, reieases, assigrunents,
settlements or compromises that (A) with respect to the payment of monetary damages,
involve oniy the payment of monetary damages (i) equal to or less than the amourrts
specifically reselved with respect thereto on the consolidated financial statements of the
Company included in the Company SEC Documents (including the notes thereto) or (ii)
not exceeding $1,000,000 in the aggregate durirrg any consecutive twelve-month period,
and (B) except as contemplated by $eeltallJ, with respect to any non-monetary terms
and conditions therein, impose or require actions that would not reasonably be expected
to be rnaterial and adverse to the Corapany and its Subsidiaries, taken as a whole;
(xv)
lines of business;
entel into any new line of business or materially alter any existing
(xvi) make or change any material 'fax election, change any Tax
accounting period, adopt or charrge any material rnethod of Tax accounting, arnend any
nraterial Tax retuLn, enter into any material closing agreement, settle or compromise any
material Tax liability or obtain any material Tax ruling, in each case, except as required
by applicable Law;
KE 39423794
27
Joint Application
Docket No. 16-057-01
Exhibit 1.1
(xvii) take any action that would reasonably be expected to plevcnt
rnaterially irnpede, interfere with, hinder or delay the consummation by Parent ol any
its Subsidiaries of the Transactions;
(xviii) rnaterially change or enter into any new information technology
systems that are material to the Company and its Subsidiaries (other than routine
rnaintenance and upgrades to existing systems); or
(xix) agree in writing to take any of the foregoing actions.
(b) During the period from the date of this Agreernent until the Effective
Time, Parent and Merger Sub shall not, and Parent shall cause its Subsidiaries not to, take any
actiotr that would reasonably be expected to prevent or materially impede, interfere with, or
delay the consumrnation by Parent or Merger Sub of the Transactions.
(") Nofwithstanding anything to the contmry helein, the Cornpany may, aud
may cause any of its Subsidialies to, tal<e reasonable actions in compliance with applicable Law
with respect to any operational emergencies (including any restoration measures in lesponse to
any hut'r:icane, to-rnado, tsunarni, flood, earlhquake ol other natural disaster ol weather-related
event, circumstance or development), equipment failures, outages or an itnnrediate and rnaterial
threat to the health or safety ofnatural Persons.
(d) Between the date of this Agleement and the Effective Time, the Company
and its SLrbsidiaties may (i) continue to make Regulatory Filings in the ordinary course of
busincss, including those filings described on Scction 5.1{d) of the Company Disclosure
Schedule, (ii) respond (after reasonable consultation with Parent) to Regulatory Filings made by
other parties in which the Company or one or rnol'o of its Subsidiaries is an interested party, and
(iii) take any other actiorr contemplated by or described in any such state or federal filings or
othel submissions filed or subrnitted in connection with such Regulatory Filings in the ordinary
course of business; provided, howeveL, that Company shall keep Parent promptly infonned of
any material communications or meetings with any Gover'ruaental Authority with respect to rate
cases and shall providc copies of any written communications or materials, shall consult with
Parent and give Parent a reasouable opporturiity, within the time constraints imposed in suoh late
oases, to comment on material written communications or materials subrnitted to any
Govemrnental Authority, in each case with respect to any rate cases, which Company shall
consider in good faith, and at the request of Palent, provide Parent a leasonable opportunity to
participate in any material rneeting or corlulluuications related thereto. Parent shall have tlie
opporlunity to rcview and comment on all economic aspects of any rate case filing and shall have
the right to approve (which approval shall not be unreasonably withheld, conditioned ol delayed)
any settletnent of any rate case and rate case filing insofar as it wouid leasonably be expected to
affect any uraterial aspect of the Surviving Corporation ot' arly of its Subsidiaries after the
Effeotive Tirne,
(e) Between the date of this Agreernent and the Effective Time, the Company
shall, and shall cause its Subsidial'ies to, use coilmercially reasonable efforts to sell, dispose of,
abandol'r, transfet or otherwise convey those celtain assets referenced on Section 5,1(e) of the
Company Disclosure Schedule. The Cornpany shall keep Parent reasonably irrformed as to the
or
of
KE 39423794
28
Joint Application
Docket No. I6-057-01
Exhibit 1.1
status of such transactions aud Parent shall have the right to consent (not to be unleasonably
witlrheld, conditioned or delayed) to any definitive documentation reflecting the foregoing.
(0 Between the date of this Agreement and tl're Effective Time, the Company
shall, and shali cause its Subsidiaries to, use colnmercially reasonable efforts to ensule that its
firm trarrsportation and finn storage contracts arc reviewed and renewed at levels that would
rnaiutain adequate peak-day gas supplies for custorners.
(g) Between the date of this Agreement and the Effective Tirne, the Comparry
shall, and shall cause its Subsidiaries to, use cornlnercially reasonable efforts to cooperate and
coordinate with Parent with respect to the transition mattels set forth on Secliqn 5.1(g) of the
Company Disclosure Schedule.
Section 5.2 Preparatiort of the Proxy Statenrerrtl fihareholders Meetiug.
(a) As promptly as reasonably practicable following the date of this
Agreement, but in any event within thifty (30) Business Days, the Company shall prepare and
file with the SEC the Proxy Statement, and Parent shall cooperate with the Company with the
preparation of the folegoing. The Company, with Parent's cooperation, shall use oonunercially
reasonable efforts to respond as prornptly as reasonably practicable to and resolve all comments
received from the SEC or its staff conceming the Proxy Statement. The Compauy agtees that (i)
except with respect to any informatiorr supplicd in writing to tlre Company by Parent or Merger
Sub for inclusion or incorporation by reference in the Proxy Staternent, the Proxy Statement will
cornply in all material respects with the applicable provisions of the Exchange Act and the rules
and regulations thereunder and (ii) none of the infonnation supplied or to be supplied by the
Company for inclusion or incorporation by reference in the Proxy Statement will, on the date it is
first rnailed to shareholdcrs of the Company and at the tirne of the Company Shareholders
Meeting, contain any untrue statement of a material fact or omit to state any material fact
requiled to be stated therein or necessary in order to malce the statements therein, in light of the
citcumstances under which they were made, not rnisleading. The Company will cause the Proxy
Statenrent to be mailed to the Company's shareholders, as promptly as reasonably practicable
after the SEC confirrns that it has no furlher comrnents on the Proxy Statement. No filing of, or
amendmerrt or supplement to, or colrespondence with the SEC with respect to, the Proxy
Statcment will be made by the Company without providing Palent a reasonable oppofiurrity to
review and cornment thereon and with the Company considering in good faith such comrnents;
provided, holever, that the foregoing shall not apply with respect to a Talceover Proposal, a
Superior Proposal, a Company Adverse Recommendation Chatrge or any rlatters relating
thereto. Each of Parent aud Merger Sub shall cooperate with the Cornpany in connection with
the preparation and fi1ing of the Proxy Statement, including prornptly furnisliing to the Company
in writing upon request any and ail information relating to it as rnay be required to be set forth in
the Proxy Statement under applicable Law. Each of the Parent and Melger Sub agrees that such
information supplied by it in writing fol inclusion (or incorporation by reference) in the Proxy
Statement will not, on the date it is first rnailed to shareholders of the Company and at the time
of the Company Shareholders Meeting, contain any untrue staterlerrt of a material fact or omit to
state any rnaterial fact required to be stated therein or necessary in order to make the statements
therein, in light of the circurnstanccs undcr which thcy werc rnade, not misleading. If, at any
time prior to the Effective Time, any information lelating to Parent or Mergel Sub or aly of their'
t{E 39423194
29
Joint Application
Docket No. l6-057-01
Exhibit l.l
lespective Affiliates, officers ol clirectols, should be discovered by Parent or Merger Sub which
should be set forth in an amendment or supplement to the Proxy Statement so that the Proxy
Staternent would not include any rnisstatement of a matelial fact ol omit to state any matelial fact
necessal'y to mahe the stateurents thelein, in light of the circumstances undel which they were
rnade, not misleading, Parent (or Merger Sub, as the case rnay be) shall prornptly notify the
Company so that it may file with the SEC an appropriate amendrnent or supplernent describing
such infonnation and, to the extent requiled by Law, disseminate such arneudmort or supplcurent
to the shareholders of the Company. If, at any tirne prior to the Effective Tirne, any information
relating to the Company or any of its respective Affiliates, officers ol directors should be
discovered by the Cornpany whiclr should be set fortlr iri ar arnendment ol supplement to the
Proxy Statement so that the Proxy Staternent would not include any misstatement of a material
fact or omit to state any material fact necessary to mal<e tlre statetnents thereirr, in light of the
circumstances under which they were rnade, not misleading, the Company sirall promptly notify
Parent arid the Company shall file with the SEC an appropriate arnendment or suppletnent
describing such infonnation and, to the extent required by Law, disseminate such amendrneut oL
supplernent to the shareholders of the Cornparry.
(b) The Cornpany shall, as promptly as leasonably practicable after the date of
the rnailing of the definitive Proxy Staternent to the Company's shareholders, in accordance with
applicable Law, the Company Charter Documents and the NYSE rules, duly give notice of,
convene and hold a meeting of its shareholders to consider the approval of this Agreement, the
plan of merger and such other matters as may be then reasonably required (including any
ad.iournment or postporrernent thereof, the "Corrpauv Share}roldcrs Meetinq"); tlrovided.
hq1yo-vst, that the Cornpany shall be pelmitted to dclay ol postpoue convening the Company
Shareholders Meeting (i) with the consent of Parent, (ii) for the absence of a quorum, (iii) to
allow reasonable additional time for any supplernental or amended disclosule which the
Company has determined in good faith (after consultation with outside legal counsel) is
necessary under applicable Law and for such suppJemental or amended disclosure to be
disserninated and reviewed by the Company's shaleholders prior to the Company Shareholders
Meeting as necessary under applicable Law or (iv) to allow additional solicitation of votes in
order to obtain the Company Shareliolder Approval. Except if there has been a Comparry
Adverse Recommendation Change in accordance with Section 5,3(d), tlre Company shall use its
reasonable best efforls to solicit and secure the Compauy Shareholder Approval.
(c) Subject to Section 5.3 and the right of the Comparry Board to mal<e a
Company Adverse Recommendation Change pursuant theLcto, unlcss and until there has been a
Company Adverse Reconlnendation Cliange in accordance with Sectiou 5.3, the Cotnpauy shal1
include the Company Board Recommendation in the pt'elinrinary and definitive Proxy Statement.
Subject to the Company's light to tenninate this Agreernent under Section 7.I(dXii), tlte
Cotnpany's obligations under this ,lpg$AlfLJ shall not be affected by the comrrencelrent, public
proposal or conlrnr.ulication to the Company of a Talceover Proposal, or by the withdrawal or'
rnodification by the Cornpany Board of the Company Board Recornrnendation.
Section 5,3 No Solicitatioul Chansc iu Rcconrnrcnrlation,
(a) The Cornpany agrees that it shall, and shali cause its Subsidiaries and its
and its Subsidiaries' respective directors, officers and ernployees to, and shall use its reasonable
t{E )9473794
30
Joint Application
Docket No. 16-057-01
Exhibit I .l
best efforls to cause its other Representatives to, irlrnediately cease all existiug discussrons or
negotiations with any Person conducted lieretofore with respect to any Takeover Proposal.
Except as otherwise provided in this Agleement, fronr the date of this Agreernent untilthe earlier
of the Effective Time or the date, if any, on which this Agreernent is terninated pursuant to
$gctigt1-[, the Company shall not, and shall cause its Subsidiaries and its arrd its Subsidiaries'
respective directors, officers and ernployees rrot to, and slrall use its reasonable best efforts to
cause its other Representatives not to, directly or indirectly, (i) solicit, initiate, knowingly
encourage or Icnowitrgly facilitate any Takeover Proposal ol the making or consummation
theleof or (ii) enter into, or othelwise participate in any discussions (except to notify such Person
of the existence of the provisions of this Section 5.J) or negotiations regarding, or furnish to any
Person any non-public material information in connection with, any Takeover Proposai.
(b) Notwithstanding anything to the contrary contained in this Agreement, if
the Company or any of its Subsidiaries, or any of its or their respective Representatives receives
an unsolicited written Takeover Proposal made after the date of this Agreement and prior to
receipt of the Company Shareirolder Approval, the Cornpany, the Company Board (or a duly
authorized corunittee thereoi) and the Company's Representatives rnay engage in negotiations
and discussions with, or fumish any irformation and otirer access to, any Person rnaking such
Takeover Proposal and any of its Representatives or potential sources of financing if the
Cornpany Board determines in good faith, after consultation with the Company's outside legal
and finaucial advisors, that such Takeover Proposal is or could reasonably be expected to lead to
a Superior Proposal and that fhilure to take such actions would reasonably be expected to be
inconsistent with its fiduciary duties under applicable Law; provided. that priol to errgaging in
any negotiations or discussions with, or' furnishing any non-public infonnation to, any such
Person or its Representatives, the Company and the Person mal<ing such Tal<eover Proposal shall
have entered into an Acceptable Confidentiality Agreernent, The Company will prornptly (and
in any event within the later of twenty-four (24) hours and 5:00 p.m, Salt Lake City time on the
next Business Day) notify Parent irr writing of the receipt of such Takeover Proposal and the
material terms and conditions of such Takeovel Proposal, ir:cluding the identity of the Person
rnalcing such Takeover Proposal. The Company will keep Parent prornptly informcd (and in any
event within the later of twenty-four (24) hours and 5:00 p.m, Salt Lake City tirne on the next
Business Day) in all material respects of the status of and material cornmunications relating to
such Takeovel Proposal (including any change in the price or other material terms thereof). The
Company shall not terminate, ameud, modify, waive or fail to enforce any provision of any
"standstill" or similar obligation of anyPerson unless the Company Board (or a duly authorized
cornmittee thereof) determines in good faith, aftel consultation with its outside legal counsel, that
the failurc to take such action would reasonably be expected to be inconsisterrt with its fiduciary
duties under applicable Law,
(c) Except as otherwise provided in this Agleement, neither the Company
Boald nor any conrmittee thereof shall (i)(A) withdraw, clrange, qualify, withhold or modify, or
publicly propose to withdraw, change, qualify, withhold ol rnodify, in a manner adverse to
Parent, the Cornpany Board Recommendation, @) adopt, approve or recolnmend, or publicly
propose to adopt, approve or recornlnend, any Takeover Proposal, (C) fail to include tl-re
Company Board Recommendation in the Proxy Statenrent or (D) fail to recornrnend against any
Talceover Proposal subject to Regulation l4D under the Exchange Act in any solicitation or
recolnrnendation statemeut tnade on Schedule 14D-9 withinten (10) Business Days afterParent
Kti'1942179,t
3l
Joint Application
Docket No. I6-057-01
Exhibit 1.1
so requests reaffirmation in wliting (provided, that Parent shall be entitled to mahe such a written
request for reaffirmation only once for each Takeover Proposal and once for each uratetial
amendrnert to such Takeover PLoposal) (any action described in this clause (i) being referred to
herein as a "Company A4vorselecqt:unettdltiqn Change") or' (ii) cause or permit the Company
or any of its Affiliates to execute or enter into, any letter of intent, mernorandum of
understanding, agreement in principle, agleement or cornrnitment (othel tltan an Acceptable
Confidentiality Agleement) constituting, or that would reasonably be expected to lead to, any
Takeover Proposal (a "CqnrDany Acqu@").
(d) Notwithstanding anything to the contrary in this Agreement, at any time
prior to obtaining the Company Shareholder Approval, the Company Board (ol a duly authorized
cormnittee thereof) may make a Company Adverse Recornrnendatiorr Change (and, solely with
respect to a Superior Ploposal, terminate this Agreernent pursuant to Sec{ion 7.1(dXii)), if (i) (A)
a Company Intervening Event has occurued or (B) the Cornpany has received a Superior Proposal
other than as a result of a breach of this Section 5.3 (other than immaterial breach), in each case,
if the Company Board (or a duly authorized committee thereof) determines in good faith, after
consultation with its outside legal counsel, tlrat the failure to nrake a Cornpany Adverse
Recommendation Change as a result of the occurrence of such Company Interening Event or in
response to the receipt of such Superior Proposal, as the case may be, would reasonably be
expected to be inconsistent with its fiduciary duties under applicable Law aud (ii) (A) the
Company provides Parent prior written notice of its intent to make any Comparry Adverse
Recomurendation Change or teuninate this Agreement pursuant to Section 7.1(.cl[!) at least four
(4) Business Days prior to taking such action to the effect that, absent any modification to the
ternrs and conditions of this Agreement, the Cor-npany Board has resolved to effect a Cornpany
Adverse Recommendation Change or to tenninate this Agreernent pulsuant to Seotion 7.1(dX.ii),
which notice shall speciff the basis for such Cornpany Adverse Recommendation Change or'
termination and attaching the rnost cun'ent draft of arry Company Acquisition Agreernent and
any other material documents with respect to, the Superiol Proposal (or', if no such draft exists, a
surnrnary of the material tenns and conditions of such Superior Proposal), if applicable (a
"Notice qf Recomm ') (it being understood that such Notice of
Recommendation Change shall not in itself be deemed a Company Adverse Recommendation
Change and that any change in price or material revisior-l or arrrendment to the tenns of a
Superiol Proposal, if applicable, shall require a new notice to which the provisior:s of clauses
(iiXA), (B) and (C) of this Section 5.3(cl) shall apply mutatis ntufandis except that, in the case of
such a new notice, all teferences to four (4) Business Days in this Sectiotr 5.3(d) shall be deerned
to be two (2) Business Days); (B) during such four (4) Business Day period, if requested by
Parent, the Cornpany shall make its Representatives leasonably available to negotiate in good
faith with Parcnt and its Representatives regarding any modifications to the telms and conditions
of this Agreement that Parent proposes to malce; and (C) at the end of such four (4) Business Day
period and taking into account arry modifications to the terrns of this Agreernent proposed by
Parent to the Company in a written, binding and ilrevocable offer, the Cornpany Board
detennines in good faith (after consultation with outside legal counsel) that the failure to rnalce
such a Cornpany Adverse Recornrnendation Change would reasonably be expected to be
inconsistent with its fiduciary dLrties under applicable Law, and that, in the case of a Company
Adverse Recomrnendation Change with lespect to a Takeover Proposal, such Takeover Proposal
still constitutes a Superior Proposal.
KE 39423794
32
Joint Applicatiort
Docket No. 16-057-01
Exhibit 1.1
(e) Nothing contained in this Agteement shall plohibit the Cornpany or the
Cornpany Board (or a duly authorized conrmittee tirereof) frorn (i) taking and disclosing to the
slrareholders of the Cornpany a position contemplated by Rule 14e-2(a) urder the Exchange Act
or making a statement contemplated by Iteur 1012(a) of Regulation M-A or Rule i4d-9 under the
Exchange Act, (ii) making any disclosure to the shaleholders of the Cornpany if the Company
Board (or a duly autholized comrnittee thereof) determines in good faith, after consultation with
its outside legai counsel, that the failure to make such disclosure would be reasonabiy likely to
be inconsistent with applicable Law, (iii) infonning any Person of the existence of the provisions
contained in this Section 5,3 or (iv) rnalcing any "stop, look and listen" cornmunication to the
shareholders of the Cornpany pursuant to Rule 14d-9(0 under the Exchange Act (or any similar
communication to the shareholders of the Company), No disclosures underthis Seqtiorr 5.3(ei
shall be, in themselves, a breach of $ection 5.3 ol a basis for Parent to terrninate this Agreement
pursuant to Artisle VIi,
(0 As r.tsed in this Agreement, "'l"akeover Proposal" shall lnearl any bona fide
iuquiry, proposal or offer from any Person (other than Parent, Merger Sub and any of its
Affiliates thereof) to purchase or otherwise acquire, directly or indirectly, in a single tmnsaction
or series of related trausactions, (a) assets of the Compar:y and its Subsidiaries (including
securities of Subsidiaries) that account for l5% or rnore of the Company's cotrsolidated assets or
fi'orn which l5o/o or more of the Courpany's revenues ol earnings on a consolidated basis are
derived or (b) 15% or more of the outstanding Compauy Common Stock pursuant to a merger,
consolidation or other business combination, sale or issuance of shares of capital stock, tender
offer, share exchange, recapitalization or sirnilar transaction involving the Cornpany, in each
case other than the Merger.
(g) As used in this Agreement, "Superiol Proposal" shall mean any
unsolicited written Takeover Proposal on tenns which the Company Board (or a duly authorized
committee thereof) determilles in good faith, after consultation with the Company's outside legal
counsel and independent financial advisols, to be more favorable to the holders of Cornpany
Common Stock than the Transactions (as rnay be revised pursuant to Sectiorr 5.3(d)" of this
Agreernent), talcing into account, to the extent applicable, the legal, financial, regulatory and
othel aspects of such ploposal and this Agreement that the Company Board considers relevant;
llroviclecltlrat for purposes of the definition of Superiol Proposal, the references to "150%" in thc
definition of Takeover Proposal shall be deemed to be references to "50%o."
Sectiorr 5.4 Reasonable Best Efforts,
(a) Subject to the terms and conditions of this Agreement, each of the
Company, Parent and Merger Sub shall use its respective reasonable best efforls to (i) cause the
Transactions to be consumurated as soon as practicable, (ii) make promptly any required
submissions and filings undel applicable Antitrust Laws or to Governrirental Autirorities rvith
respect to the Transactiotrs, (iii) promptly fumish information requiled in comection with such
submissions and filing to such Governmental Authorities or under such Antitnrst I,aws, (iv) keep
the other parlies leasonably infonned rvith respect to the status of any such submissiorrs and
filings to such Governmental Authorities or under Antitrust Laws and cooperate with each other,
inclrrding with respect to: (A) the receipt of any non-action, action, cleararlce, consent, approval
or waiver, (B) the expiration of any rvaiting period, (C) the comrnencelreltt or proposed or
KE 39423794
33
Joint Application
Dooket No. 16-057-01
Exhibit 1 .I
threatened cornrrencement of any investigation, litigation or adrninistrative or judicial action or
proceeding under Altitrust Laws or other applicable Laws and (D) the nature and status of any
objections raised ol proposcd or threatened to be raised undel A:rtitrust Laws or other applicable
Laws with rsspect to the Transactions and (v) obtain ali actions or norr-actions, approvals,
consents, waivers, registrations, permits, authorizations and other confirmations from any Person
necessary to consurnrnate the Transactions as soon as ptacticable. For putposes heteof,
"Antitrust Larvs" ffleans the Sherman Act, the Clayton Act, the FISR Act, the Federal Trade
Commission Act, all applicable foreign Antitrust Laws and all other applicable Laws issued by a
Goverrunental Authority that are designed or intended to prohibit, restrict or regulatc actions
having the purpose or effect of rnonopolization or restraint of trade or' lessening of competition
tlu'ough merger or acquisition.
(b) In furtherance and not in lirnitation of the foregoing: (i) each party hereto
aglees to (A) rnalce an appropriate filing of a Notification and Report Form pursuant to the HSR
Act with rcspect to the Transactions as pronrptly as rea.sonably practicable following the date of
this Agreernent (and in any event witirin ten (10) Business Days after the date heleof (unless the
parties otherwise agree)), (B) supply as soon as practicable any additional inforntation and
documentary rnaterial that nray be requested pursuant to the HSR Act and (C) use its leasonable
best efforts to tal<e, ol cause to be taken, all other actions consistent with this Section 5,4
necessaly to cause the expiration or tennination of the applicable waiting periods under the HSR
Act (including any extensions thereof) as soon as practicable aud (ii) each party agrees to (A)
malce or cause to bc made the appropriate filings (including uotice filings) as sooll as practicable
(and in any event within twenty-one (21) Business Days aftel the date heleof (unless the parties
otlrcrwise agree)) with the PSCU, PSCW and PUCI lelating to the Merger, @) supply as soolr as
practical any additional inforrnation and docurnentary material that rnay be reqr"rired or requestcd
by the PSCU, PSCW and PUCI and any otlier applicable Governmental Authority and (C) use its
reasonable best efforts to take or cause to be taken all other actions consistent with this Sectior,
5.4 as necessary to obtain any necessaly approvals, consents, waivers, permits, authorizations or
other actions or non-actions from the PSCU, PSCW and PUCI as soon as practicable. Prornptly
after the date of this Agreement, at Parent's reasonable request, the Company and Parent agree to
meet and confer in good faith to discuss and consider combining or consolidating any
outstanding or planned rate cases with respect to the Required Statutory Approvals and filings set
forth in Section 5.4(bXiiXA).
(c) The Cornpany, Parent and Melgel Sub shall, subject to applicable Law
relating to the exchange of infonnation: (i) promptly notify the other parlies heleto of (and if in
writing, furnish the other parties with copies of) any cornrnunication to such Person fi'om a third
persoll or any Governmental Authority regarding tlte filings and submissions described in
Section 5.4(a) and permit the others to review and discuss in advance (and to consider in good
faith any courments rnade by the others in relation to) any proposed writteu response to any
communication fiom a Governmental Authority legarding the filings and subtnissions described
in Section 5.4(*), (ii) keep the others reasoriably infonned of any developments, ureetings or
discussions with any Goveltunental Autholity in lespect of any filings, investigation ol inquily
concerning the Transactions and (iii) not independently participate in any meetirrg or discussions
with a Govelnmental Authority in respect of any filings, investigation or inquily concerning the
Tlansactiorrs witliout giving the other palty prior notice ol such meeting ol discussions aud,
unless prohibited by such Governmental Autholity, the opportunity to attend or participate;
KE 39423794
34
Joint Application
Docket No. l6-057-01
Exhibit 1 .l
providcd, that the parties shall be pennitted to redact ary correspondence, tiling, submission or
communicatiou to the extent such coruespondence, filing, submission or cornmunication contains
competitively or cotrmercially sensitive inforrnation, including inlonnation relating to the
valuation of the Transactions.
(d) In furtherance and not in Iimitation of the foregoing, but subjcct to the
other tenns and conditions of this $gqfiguLt, Parent, Merget Sub and the Company aglee to
take promptly any and all steps necessary to avoid, eliminate or resolve each and evety
impediment and obtain all clearances, conserlts, approvals and waivers under Antitrust Laws or
other- applicable Laws that rnay be required by any Governrnental Authority, so as to enable tlre
parties to close the Transactions as soon as practicable (arid in any event no later than three (3)
Business Days plior to the End Date), including committing to and efl'ecting, by consent decree,
hold separate orders, trust, or otherwise, (i) the sale, license, holding separate or other disposition
of assets or businesses of Parent or Compally or any of their respective Subsidiaries, (ii)
terminating, relinquishing, rrodifyil'lg, or waiving existing relationships, veutures, contractual
lights, obligations or other arangements of Pareut or Company or theil respeotive Subsidiaries
and (iii) creating any relationships, velrtures, contractual lights, obligations or other
al'rangernents of Parent or Company ol their respective Subsidiaries (each a "Remedial Action");
providecl. hottever, that any Remedial Action may, at the discretiorr of the Cornpany or Parent,
be conditioned upon consummatiou of tire Tlansactions.
(e) In furtherance aud not in lirnitation of the foregoing, but subject to the
other tenns and conditions of this Section 5,4, in the event that any litigation or other
administrative or judicial action or plocceding is commenced, threatened or is rea.sonably
foreseeable challenging any of the Transactions and such litigation, action or proceeding seeks,
or would reasonably be expected to seel<, to prevent, materially impede or materially delay the
consummation of the 'fransactions, Parent shall use reasonable best efforts to take any and all
action, including a Remedial Action, to avoid or resolve any such litigation, action or proceeding
as promptly as practicable (and in any event shall commence such action no later than tluee (3)
Business Days prior to the End Date), In addition, each of the Company, Parent and Melger Sub
shall cooperate with each other and use its respective reasonable best efforts to contest, defend
and resist any such litigation, action or proceeding and to have vacated, Iifted, reversed or
overturned any ruling, decree, judgment, injunction or other order, whether temporary,
preliminary 01' perrnanent, that is in effect ar-rd that prohibits, prevents, delays, interferes with or
restricts consummation of tlte Tlansactions as promptly as practicable and in any event no later'
than three (3) BLrsiness Days prior to the End Date.
(0 Florn the date hereof until tlre earlier of the Effective Time and the date
this Agreernent is terminated pursuant to Articlc VII, neither Patent, Merger Sub nor Company
shall, nor shall they permit their respective Subsidiaries to, acquire or agreo to acquire any rights,
assets, business, Person or division thereof (through acquisition, license, joint venture,
collaboration or otherwise), if such acquisition, would reasonably be expected to matelially
increase the risk of not obtaining any applicabie clsaranca, consent, approval ol waivel undel
Antitrust Laws or other applicable Laws with respect to tlre Transactions, or would reasonably be
expected to rnaterially prevent or prohibit or impede, intelfere witlr ol delay obtaiuing any
applicable clealance, consettt, approval or waiver under Antitrust Laws or other applicable laws
with lespect to the Transactions.
KE 39423794
J)
Joint Application
Docket No. l6-057-01
Exhibit l.l
(g) Notwithstarrding the obligations set forth in this Agreement, Parent and its
Affiliates shall not be required to, and, without the prior written consent of Palent (which
consent may be withheld at Parent's sole discretion) the Company shall not, and shall cause its
Subsidiaries not to, in connection with obtainiug any consent or approval of any Covenrurental
Autholity in connection with this Agreement or the transactions contemplated hereby, offer or
accept, ol agree, conunit to agtee or consent to, any undeltalcing, ter111, conditiou, liability,
obligation, colnmitment or sanction (including any Remedial Action), that constitutes a
Burdensorne Condition.
(h) Parent shall promptly notifz the Company and the Company shail notify
Parent of any notice or other communication from any Govemmental Autholity alleging that
such Governnental Authority's consent is ol may be required in connectiorr with or as a
condition of the Merger.
Section 5.5 Public Announcements. The initial press release with respect to the
exectition of this Agreement shall be a joint press release to be reasouably agreed upon by Parent
and the Cornpany. Following such initial press release, Parent and the Company shall consult
with each other before issuirrg, and give each other the opportunity to review and cornment upon,
any press release or other public statements with respect to the Transaclions and shall not issue
auy such press release or make any such public statement prior to such consultation, except as
such pafty lnay reasonably conclude may be required by applicable Law, coutt process or by
obligations pursuant to any listing agreement with any national securities exchange or national
securities quotatiou systern (and then only after as much advance notice and consultation as is
feasible); providcd. hou,cvcr', that the restrictions set forth in this Section 5.5 shall not apply to
any release or public staternent (a) rnade or proposed to be made by the Company in connection
rrrith a Takeover Proposal, a Superior Proposal or a Company Adverse Recommendation Change
or any action taken pursuant thereto, (b) in comrection with any dispute between the pafties
regarding this Agreement or the Transactions or (c) that is not incousistent in any material
respects with the priol public disclosures regarding the Transactions.
Section 5.6 Access to Inf'ormation; Confidentialitv.
(a) Sub.ject to applicable Laws relating to the exchange of infonnatiott, ft'orn
the date hereof until the earlier of the Effective Tirne or tire date on which this Ag'eernent is
tenninated in accordance with its terms, the Cornpany shall afford to Parent and its
Representatives reasonable access (at Parent's sole cost and expense) duling norrnal business
hours aud upon l'easonable advance notice to the Cornpany's and its Subsidiaries' proper-ties and
personuel (but excluding fot the conduct of Phase I or Phase II environ:nental assessments or
testing), books, Contracts and lecords and the Company and its Subsidiaries shall furnish
prornptly to Parent such inforrnation conceming its business and properties as Parent may
leasonably lequest (other tharr any publiciy available docurnent filed by the Cornpany and its
Subsidialies pursuant to the requirements of federal or state securities Laws); lUovidqti that
Palent and its Replesentatives shall conduct arry such activities iu sucli a rlanuer as not to
interfete unleasonably with the business or operations of the other parly; provides!. further, (x)
that the Con-rpauy shall not be obligated to provide such access ol inforrnation if the Company
detelrnines, in its reasonable judgment, that doing so would violate applicable Law or a Contract
or obligation of confidentiality owing to a third party, jeopardize the protection of the attomey-
KE- 39423'.194
36
Joint Application
Dockct No. 16-057-01
Exhibit l.l
client privilege, or expose such party to rislc of liability fol disclosure of sensitive or personal
information and (y) tlre conduct of such activities shall be subject to the rights and obligations of
the Cornpany lef'erred to in the final proviso of the final sentence of Section 5,4[q) hereof,
Without lirniting the foregoing, the Compariy shall, and slrall cause its Subsjdiaries to, provide
cornrnercially reasouable assistance to Dominion Midstream Partners (including the Conflicts
Comrniffee of DMPGP) in connection with thc preparation of furancial staternents that may be
required in connection with any proposed contribution of Questal Pipeline ol any of its assets to
Dorninion Midstream Partners. Until the Effective Tirne, the infonnation provided will be
subject to the tenns of the confidentiality letter agreernent, dated as of Decernber 30, 2015,
between Parent and the Company (as it nray be amended fronr time to time, thc "Q0jrl"identiality
Asreenrent"), and, without limiting the generality of the foregoing, Parent and Company shall
not, and Parent and Courpany shall car:se their respective Replesentatives not to, use such
information for ary pulpose uruelated to the consunlnation of the T'ransactions.
(b) lf this Agreement is terminated pursuant to Sqqtion 7_-1, the Confidentiality
Agreement shall autotnatically be deemed to be amended and restated such that (i) the
"Restricted Period" for all pulposes of the Confidentiality Agreernent shall be the period of
eighteen (18) rnonths fi'om the date of such termination, as if the Parlies had never entered into
this Agreernent, and (ii) the other provisions of the Confidentiality Agreement shall relnain irr
force and cffect fot a peliod of two (2) yeaLs after such termination, as if the parties hereto had
never entered into this Agreement.
Section 5.7 'falie_trJcr Ltu's, lf any Takeovel Statute becoures applicable to the
Transactions, the Company and the Cornpany Board will use reasonable best efforts to ensure
that such Transactiotts may be consummated as prourptly as practicable on the terms
contemplatcd by this Agreetnent and otherwise to minimize the effect of such statute or
regulation on the Transactions.
Section 5.8 Indemnific3tion anrl Insurance.
(a) From and after the Effective Time, Parent shall, and shall cause the
Surviving Corporation to, (i) indemrrify, defend and hold harmless cach current and fomer'
director, officer and employee of the Cornpany and any of its Subsidiaries and eaclr person who
served as a director, officer, rnember, trustee or fiduciary of another corporation, pattnelship,
joint ventule, trust, pension or other employee benefit plan or enterprise if such service was at
ttre request or for the benefit of the Company or any of its Subsidiaries (each, an "lltden:nitce"
and, collectively, the "]111!_ql11!-tge!") against all claims, liabilities, losses, damages, judgments,
fines, penalties, costs (including amounts paid in settlement or compromise) and expenses
(including fees and expenses of Iegal counsel) in connection with any actual orthreatened claim,
suit, action, proceeding or investigation (whether civil, criminal, adnrinistrative or investigative)
(each, a "Claim"), whenever assetted, arising out of, relating to or in connection with any action
or omissiou relating to their position with the Company or its Subsidiaries occurring or alleged to
have occurred bcfote or at the Eff'ective Time (including any Claim relating in whole or in part to
this Agreement or the Transactions), to the fullest extent permitted r.rnder applicable Law and (ii)
assurre all obligations of the Company and its Subsidiaries to the lndemnitees in respect of
limitation of liability, exculpation, indernnification and advancemerrt of expenses as provided in
(A) the Company Charter Documents and the respective organizatioiral documents of each of the
KE 39423794
37
Joint Application
Docket No. 16-057-01
Exhibit 1 ,1
Conrpany's Subsidiaries as currently in effect and (B) any iudenurification agreerlents with an
Indernnitee listed ou SCaIgLl,g&) of the Cornpany Disclosure Schedule, which shall in each
case survive tlie Tlansactions and continue in full force and effect to the extent perrnitted by
applicable Law. Without linriting the folegoing, at the Effective Time, the Surviving
Corporation shall, aud Palent shall cause the Surviving Corporatiou to, cause the articles of
incorporation and bylaws of the Surviving Corpolation to include provisions fol lirnitation of
liabilities of dilectors and officers, indemnification, advancement of expenses and exculpation of
the lndemnitees no less favorable to the Indemnitees than as set forth in the Company Charter
Documents in effect on the date of this Agreement, whicli provisions shall not be amended,
repealed or otherwise modified in a rnanner that would adversely affect the lights thereunder of
the hrdennitees except as required by applicable Law.
(b) From and after the Effective Time, Parent shall, and shall cause the
Surviving Corporation to, pay and advance to ar Indemnitee any expenses (including fees and
expeuses of legal counsel) in connection with any Claim relating to any acts or omissions
covered under this Section 5.8 or the enforcement of an Indemnitee's riglrts under this Section
5.8 as and when iucuned to the fullest extent pennitted under applicable Law, pnryiderj. that the
person to whom expenses are advanced plovides an undertal<ing to repay such expenses if it is
ultirnately determirred by a court of competent jurisdiction that such lndernnitee is not entitled to
indemnificatiorr for such matter.
(c) For a peliod of six (6) years frorn the Effective Time, Parent shall cause to
be niaintaired in effect coverage not materially less favolable than the coverage provided by the
policies of directors'and officers' liability insurance and fiduciary liability insurance irr effect as
of the date hereof maintained by the Company and its Subsidialies with respect to matters arising
on or before the Effective Time either through the Company's existing insulance provider or'
another provider reasonably selected by Parent; provided, lrowcv_cr, that, after the Effective
Time, Parent shall not be required to pay annual premiurns in excess of 300% of the annual
premium cuuently paid by tlie Company in respect of tho coverages required to be obtained
pursuant hereto, but in such case shall pnrchase as much coverage as reasonably practicable fol
such amount; p_tSyIlgd. ibrtl:er, that in lieu of the foregoing insurance covel'age, the Company
may purchase "tail" insurauce coverage, at a cost no greatel than the aggregate amonnt which
Parent would be required to spend during the six-yeal period provided for in this Section 5.8{c),
that provides coverage not matelially less favorable than the coverage described above to the
insured persons than tlre directors' and officers' Iiability insurance and liduciary Iiability
insurance coverage currently rnaintained by the Cornpany arid its Subsidiaries as of the date
hereof with respect to matters arising on or before the Effective Tirne.
(d) The provisions of this Section 5.ll are (i) intended to be for the benefit of,
and shall be enforceable by, each lndernnitee, his or her lieirs and his or her representatives fl'om
and after the Effective Time, and (ii) in addition to, and not in substitution for or lirnitation of,
any othel rights to indernnification or contribution that any such Person may have by coutract or
otherwise. The obligations of Parent and the Surviving Corporation underthis Section 5.ll shall
not be tenninated or rnodified in such a rnanner as to adversely affect the rights of any
lndemnitee to whorn this Scction 5.8. applies unle.ss (A) such tennination or modification is
requiled by applicable Law or (B) the affected Indemnitee shall have consented in writing to
KE 39423794
3B
Joint Application
Docket No. 16-057-01
Exhibir L I
such tennination or modification (it being expressly agreed that the Indernnitees to whorn this
Section .5.8 applies shall be third party benetlciaries of this Section 5.8J.
(e) In tlre event that Parent, the Surviving Corporation or any of their
respective successors or assigns (i) consolidates with or merges into any other Person and is not
the continuing ol suriving corporation or entity of such consolidation or lnerger or (ii) transfers
or conveys all or substantially ail of its properties and assets to any Person, then, arrd in each
such case, ploper provision shall be made so that the successors and assigns of Pareut and the
Surviving Corporation shall assume all of the obligations theleof set forth in this Section -5.8.
Section 5.9 Transaction Litigation. Each of Parent and the Cornpauy shall notifu the
other promptly of the comrnencement of any shareholder litigation lelating to this Agreement or
the Transactions of which it has received rrotice or which, to the Knowledge of the Company, is
thleatened ("Transaction l-,itigation"), The Cornpany shall give Parent the opporfunity to
participate in, but not control, tlre defense or settiemerrt of auy Transaction Litigatiori, and no
such settlement of any Transaction Litigation shall be agreed to by the Compauy without
Parent's prior written consent, such consent not to be unreasonably withheld, conditioned or
delayed.
Section 5.10 Section 16,, Prior to tlre Effective Time, each of the Company, Palent and
Merger Sub shall take all such steps reasonably recessary to cause any dispositions of Cornpany
Corrmon Stoch (including derivative securities with lespect to Cornpany Cornrnon Stock)
ditectly resulting from the Merger by each individual rvho will be subject to the repotling
requirernents of Section I6(a) of tlie Exchange Act with respect to the Company immediately
prior to the Effective Time to be exempt undel Ruie 16b-3 promulgated under the Exchango Act.
Section 5.11 linrnlovee Matters.
(a) Until the later of one (1) year followirig the Effective Time or December
31,2017 (the "Co$trugdpu-Egripd"), Parent shall provide, or shall cause to be provided, to each
individual who is ernployed by the Cornpany or any of its Subsidiaries (including the Surviving
Corporation and its Subsidiaries) imniediately prior to the Effective Time (each, a "Company
llnrplgygl:") annual base salary and base wages, target annual cash bonuses (subject to the
satisfaction of performance criteria detennined by Parent, nlovided that such performance
criteria shall be no less favorable than for other sirnilarly situated enrployees of Parent and its
Subsidiaries) and target long-temr incetrtive compensation oppottunities (which shall be in a
form and subject irr whole or in partto the satisfaction of perfbrmance criteria as detennined by
Parent, prr:r,ided that the fornr of such awards and the performance criteria shall be no less
favorable than for other sirnilarly situated employees of Parent and its Subsidiaries) and
employee benefits (excluding any volurtary elective deferral component of auy nonqualified
deferred compensation plan) that, in each case, aro no less favorable in the aggregate than such
annual base salary and base wages, target annual cash bonuses and target long-term incentive
compensation opporlunities and employee benefits provicled to the Company Ernployees
immediately prior to tlie Effective Time; ploylclrd, howcvcr, that annual cash bonus and any
long-telrn iucentive compensation opportunities shall not be required to be provided fbr
perfonnarrce periods commencing beforeJanuary 1,2017 and, if tbe Effective Time occurs in
2017,any amual cash bonus opportunity may be pro-rated based on days of service duling such
KE 39423794
39
Joint Application
Docket No. 16-057-01
Exhibit 1.1
pelformance period on and after the Closing Date. Notwithstanding any other provision of this
Agleernent to the contraly and without limiting the generality of the foregoing, Palent shall or
shall cause the Surviving Corporation to provide any Company Ernployee whose employnent
tenninates under circumstances entitling the Company Enrployee to severance under the
applicable Parent sevelance plan, program ol auangemeut (or any successo-r.- thereto)
(collectively, the "Parent Severance Pregrams") during the Continuation Period (including, fol
avoidance of doubt, any Company Employee whose ernployment terntinates undel such
circurnstances in an individual or one-off termination and regardless of whether any other
ernployee is affected) or, with respectto the Company Ernployees identified on Section 5.11(a)
of the Company Disclosure Schedule, whose employment ternrinates for "Good Reason" (as
defined in Seclion 5.1 l(q) of the Company Disclosure Schedule), and who signs a genet'al release
of clainrs on a fonn satisfactory to Parent, witlr severance benefits no iess favorable than those
provided to sirnilarly situated ernployees of Parent and its Subsidiaries under the Parent
Severance Proglams, and, for the avoidance of doubt, taking into account all of the Company
Employee's service with tlre Cornpany ar,d its Subsidiaries (and their predecessols) for purposes
of detennining the levels of severance benefits to be provided to such Company Employee under
the Parent Severance Programs; pfpy:"dgg!, lt*yryql, that no Cornpany Ernployee who is covered
by the Cornpany Executive Sevelance Compensation Plan or any other severance plan or
arrangement witlr the Company or its Subsidiaries that provides for more favorable severance
payments and benefits than the Palent Severance Prograrn shall be eligible for coverage under
the Parent Severance Prograrn,
(b) For all puryoses (including purposes of vesting, eligibility to participate
and level of benefits but not for purposes of defmed benefit pension acclual) urrder the enrployee
benefit plans of Parent aud its Subsidiaries providirig benefits to any Cornpany Employee after
the bffective Tinre (including the Cornpany Plans) (the "Nerv Plans"), each Company Ernployee
shall be credited witlr his or her years of service with the Cornpany and its Subsidiaries and their'
respective predecessors befole the Effective Time, to the sarne extent as such Company
Ernployee was entitled, before the Effective Time, to credit for such service under any Cornpany
Plan in which such Company Employee participated or was eligible to participate irnmediately
prior to the Effective 11me; providilcl, .hglysygl, that the foregoing shall not apply to the extent
that its application would lesult in a duplication of benefits with respect to the same period of
service and, provided further, that no Cornpany Ernployee shall be entitled based on such prior
credited service or otherwise to participate in auy frozen or grandfathered plan ol benefit formula
of Parent or any of its Subsidiaties that would not be offered to employees first hired by Palent
ol its Subsidiaries after the Effective Time. Fufihennore, to the extent a Company Ernployee or
a "Company Retited Eurployee" (as defined beiow) becomes eligible to participate in Parent's ot'
its Subsidiaries'retiree medical plan, for all purposes (including pluposes of vesting, eligibility
to participate and level of benefits) under tlre tetilee medical plan of Parent and its Subsidiaries,
each (x) Company Ernployee and (y) forrner employee of the Cornpan1, 6,' any of its Subsidiaries
whose employment with the Coinpany or any of its Subsidialies ended as a result of such former
employee's retilement and wlro is eligible to participate in the Cornpany's retiree nredical plan as
of the Effective 1-ime (the "Cornpjllly_Bclilgd$Ip-loIgg$"), shall be clcdited with his or her
years of sewice with the Comparry and its Subsidialies arrd tlreir respective predecessors before
the Effective Tirne, to the same extent as such Company Employee ot Cornpany Retired
Employee was eutitled, immediately before the Effective Time, to credit fot such ser.rice uncler
tlic Company's retiree medical plan as of the Effective Tinre; l:rovicled that any individual who
KE 39423794
40
Joint Application
Docket No. l6-057-01
Exhibit LI
waived participatiou in the Company's retiree tnedical plan but is still eligible, pursuant to the
tenns of such rctiree medical plan as in effect on the date irereof, to participate in suclr plau, shall
remain eligibie to participate in such plan but shall not be or become eligible to participate in any
retiree medical plan of the Parent and its Subsidiaries (other than the Sulviving Corporation) and
provided furlher that the pafties agree to the matters set forth on .Sectir:rn 5.I I (Q) of the Company
Disclosure Schedule, Parent shall, or shall cause an Affiliate to, provide postretirement medical
lrenefits to Eligible Retirees (as defined below) that (i) during the Continuation Period are no less
favorable than those provided under the Cornpauy's postretirernent medical program in effect as
of December'31, 2015 (the "-QElpg!la_&s!"tree l-leal{h Plan") ard (ii) following the Contirluation
Period are no less favorable than either (1) those provided under tlre Company Retiree I{ealth
PIan or (2) those provided to similarly situated, as applicable, ernployees and retirees who
participate in the post-retirement progl'ams of Palent or its Subsidiaries (other than the Surviving
Cotporation). "Iiligfb.lg"BgUrepI" nleans Contpany Retired Employees and Comparry Employees
who are or become eligible to participate in the Cornpany Retiree Health Plan as in effect on
January 1, 2016. In addition, and without lirniting the genelality of the foregoing, (i) each
Company Employee shall be immediately e)igible to patticipate, without any waiting time, in
any and all New Plans to the extent coverage under such New Plan is replacing comparable
coverage under a Cornpany Plan in which such Cornpany Employee participated irnrnediately
befole the Effective Time (such plans, collectively, the "Old Plans"), and (ii) for purposes of
each New Plan providing medical, dental, pharmaceutical and/or vision berrefits to any Cornpany
Ernployee, Parent shall use commelcially reasonable efforts to cause all pte-existing conditiorr
exclusions and actively-at-work requiremeuts of such New Plan to be waived for such Cornpany
Employee and his or her covered dependents, to the extent such conditions were inapplicable or
waived urrder the comparable Old Plans of the Company or its Subsidiaries iri which such
Compar.ry Employee participated irnmediately prior to the Eff'ective Tirne. Parent shall use
commercially reasonable efforls to cause any eligible expenses incurred by any Cotnpany
Employee and his or her covered dependents during the portion of the plan year of the OId Plan
ending on the date such Cornpany Employee's participation in the corresponding New Plan
begins to be taken into account under such New Plan fol pulposes of satisfying all dcductible,
coinsuLance and tnaxitnum out-of-pocket requirements applicable to such Company Ernployee
and his ol her covered dependents for the applicable plan year as if such amounts had been paid
in accordance with such New Plan.
(c) Wilhout lirniting the generality of ESallex llUrl), from and after the
Effective Time, Parent shall causc the Surviving Corporation ancl its Subsidiaries to assurne and
honor and continue all obligations under the Company Plans ancl comperrsation and severallce
arrangelnents and agreements in accordance with their terrns as in effect irnrnediately befole the
Effective Time, and the 'fransactions shall be deemed to constitute a "change in control,"
"change of control", "corporate tLansaction" or sirnilar words to such effect under such Conrpany
Plans, arral'l gements ot agleements.
(d) To the extent that tire Effective Time occuls (i) in 2016 or (ii) following
the end of the 20i 6 performance period rvith respect to the Company's Annual Incentive Plans or'
any othel applicable annual bonus plan, but, in each case, priol to payrnent of the bonuses for
such 2016 perfornrance period, Parent shall cause the Sr.nvivirrg Corporation to pay to each
Company Ernployee the greater of (i) thc Company Employcc's target bonus foi such 20I6
performance period and (ii) the bonus to which the Company Employee would be entitled for
KE 39423't94
4l
Joint Application
Docket No. l6-057-01
Exhibit l.l
such 2016 performance period based on actual performance. In addition, in the event that the
Effective Tirne occurs irr 2017, at the Effective Time, Parent shall cause the Surviving
Corporation to pay to each Company Employee a pro-rata portion of any bouus that suclt
Conrpany Employee would have been entitled to receive undel tl:e Company's Annual Incentive
Plans and any other applicable annual bonus plan for the 2017 performance period based on the
Cornpany Employee's target bonus for such 2017 perfoLllrance period.
(e) Notwithstanding auything to the contrary herein, the prrovisions of this
Section 5.1I are solely for the benefit of the parties to this Agleement, and no provision of this
Section 5.1 I is intended to, or shall, constitute the establishment or adoption of or an amendment
to any Company Plans or any employee benefit plan of Parent, Surviving Corporation or their'
lespective Subsidiaries, arrd no ConTpany Employee or any othel iudividual associated therewith
shall be regarded foi'any pulpose as a thild-party beneficiary of this Agreement or ltave the right
to enforce the provisions hereof including in respect of continued ernploynent (or resumed
employrnent). Unless otherwise specifically provided in this ;^ection 5.11, no provision of this
Agleernent shall constitute a limitation on Parent's, the Suriving Corporation's or their
respective Subsidiaries' right to amcnd, rnodify or tcrnrinate, after the Efl'ective Tir:re, any
Company Plan or any employee benefit plan of Parent, Surviving Corpolation or theil t'espective
Subsidiaries. Nothing contained herein shall alter the at-will employment relationsirip of any
Cornpany Employee,
Section 5.12 iVlerger Sub tnd Surviving Coruoration. Parent shall take all actions
llecessary to (a) cause Melger Sub arrd the Suruiving Corporation to perform promptly their
lespective obligations undel this Agreernent and (b) cause Melger Sub to consummate the
Mergel on the terms and conditions set forlh in this Agreement, Prior to the Effective Titne,
Merger Sub shall not eugage in any activity of any nature except for activities related to or in
furtlrerance of the Transactions,
Section 5.13 No Control of Other Parfv's, Busincs$. Nothing contained in this
Agreement is intended to give Parent or Merger Sub, dilectly or indirectly, the right to control or
direct the Company's or its Subsidiaries' openations prior to the Effective Time. Plior to the
Effective Tilne, the Cornpany shall exercise, corrsistent with the temrs and conditions of this
Agreement, cornplete control and supervision over its and its Subsidiaries' respective operations.
Section 5.14 Stock Exchangc Delistins: Exchangc Act Deregistration. Before thc
Effective Time, the Cornpany shall cooperate with Parent and use its reasonable best efforls to
take, or cause to be taken, all actions, and do or cause to be done all things reasottably necessary,
pl'oper or advisable on its part under applicable Laws and rules and policies of the NYSE and
SEC to enable the delisting by the Surviving Corporation of the Company Comtnon Stock fi'orn
the NYSE and the deregistration of thc Cornpany Common Stock under the Exchange Act as
promptly as practicable after the Effective Time, and in any event no more thal ten (10) days
after the Closing Date.
Section 5.15 Advioe of Chariges, From aud aftel the date of this Agreernent until the
Eff'ective Time, each of Parent and the Company will, to the extent not in violation of any
applicable Law, protnptly notifli the othel' of (a) any cilcumstance, development, chatrgc, cvent,
occurrerlce or effect of which it has Kr:owledge that has liad or tliat would reasonably be
t<E 39423?94
42
Joint Application
Docket No. I 6-057-01
Exhibit 1 .I
expected to have a Parent Material Adverse Effect ol a Company Matelial Adverse Effect, as the
case may be, or (b) any matedal breach of any of its representations, watranties or covenants
contained in this Agreement that would reasonably be expected to give rise to a failure of any
condition to tlie obligations of the other party to effect the Merger set forth in Article VI to be
satisfied, provided that (i) no such notification will affect the representations, warranties or
covenants of the pafties or tlte conditions to the obligations of tlie parties under this Agreernent
and (ii) in no event shall the failure to cornply with this Section 5.15 give rise to a failure of any
condition set forth in Article VI to be satisfied.
Section 5.16 Sinancing Cooperntion
(a) The Company shall, and shall cause the Subsidiaries of the Company to,
(i) provide commercially reasonable assistance with the preparation of and any discussiorrs
regarding the business, financial statements, and management discussion and analysis of the
Company and the Subsidiaries of the Cornpany, all for use in comection with any debt or equity
financing to be obtained by Parent or any Subsidiary of the Parent, includirrg any registration
statement filed with the SEC in ar:tici;:ation tliereof (the "Finarrcing", which term shall include,
without limitation, the Transaction Financing) whcre Parent determines tliat the inclusion of such
infonnation is required or desirable, and (ii) request that its irrdcpendent accountants provide
customary and reasonable assistance to Parent or any Subsidiary of Parent, as applicable, in
conuection with providing customary comfofi letters itr comrection with the Finatrcing; provided,
further, that nothir:g in this Agreement sha1l require the Company to cause the delivery of
(A) legal opinions or leiiance letters or any certificate as to solvency or any other certificate
necessary for the Financing, other than as allorved by the pleceding clause (ii), (B) any audited
financial information or any financial information plepared in accordance with Regulation S-K
or Regulatiorr S-X urrder the Securities Act or any fiuancial infonr-ration in a folm not
custonrarily prepared by the Company with respect to any period or (C) any financial
inforrnation with respect to a moritlr or fiscal period that has not yet ended or has ended less than
forty-five (45) days prior to the date ofsuch request.
(b) Notwithstanding anything to the contraly contained in this Agreernent
(including this Sectiorr 5.16): (i)nothing in this Agreement (including this SpSflOtt_5l$) shall
require any such cooperation to the exteut that it would (A) require the Cotnpany to pay any
commitment or other fees, reimburse any expenses or otherwise incur any liabilities or give any
indernnities prior to the Closing, (B) unreasonably interfere with the ongoirrg business or'
opemtions of the Cornpany or any of the Subsidiaries of the Company, (C) requile the Cornpany
or any of the Subsidiaries of the Courpany to enter into or approve any agreement or other
documentation effective prior to the Closing or agree to any change or modification of any
existing agreement or other documerrtation that would be effective prior to the Closing,
(D) require the Compury to provide pro formo financial statements ot pt'o .forma adjustments
reflecting the Financing or any description of all or arry cornponent of the Firrancing (it being
urrderstood that the Company shall usc reasotrablc best efforts to assist in prepalation of pro
fornta financial adjustments to the exterrt otherwise relating to the Company and requiled Lry the
Financing), @) require tlre Cotnpany or the Subsidiaries of tire Cornpalry to provide pro fonna
finarrcial staternents or pro Jbrma adjustments leflecting transactions contemplated or requir:ed
hereunder (it being understood that the Cornpany shall use reasonable best effolts to assist in
preparation of pro.forma financial ad.justrnents to the extent otherwise relating to thc Company
KE 39423794
43
Joint Application
Docket No. l6-057-01
Exhibit 1 .1
and rcquircd by the Financing), or (F) require the Company, any of the Subsidiaries of the
Company or arly of their respective boards of directols (or equivalent bodies) to applove or
authorize the Financing, and (ii) no action, liability or obligation (includirrg any obligation to pay
any commitment or other fees or reirnburse any expenses) of the Company, the Subsidiaries of
the Company ot arry of their respective Representatives under any ceftificate, agreement,
arrangemerlt, doculncut or instrument lelating to the Financing shall be effective until the
Closing.
(c) Parent shall (i) prornptly leimburse the Cornpany for all reasonabie and
out-of-pocket costs or expenses (including reasonable and documented costs and expenses of
coursel and accountants) incured by the Cornpany, the Subsidiaries of the Cornpany and any of
its or their Representatives in comection with any cooperation provided for in this Sestion 5,16
and (ii) indernnify and hold harmless the Company, the Subsidiaries of the Cornpany ol any of
its and their Representatives against any claim, loss, damage, injury, liability, judgment, award,
penalfy, fine, Tax, cost (including cost of investigation), expense (including fees and expenses of
counsel and accountants) or settlernerrt payment incuned as a result of, or in connection with,
arly cooperation provided for in this Section 5.16 or the Financing and any infot'rnation used in
connection thelewith, unless the Cornpany acted in bad faith or with gross negligence aud otirer
than in the case of fraud.
(d) Without limiting the generality of the foregoing, plomptly following
Parent's request, the Cornpany shall deliver to each of the lenders under the Company's and its
Subsidiaries' existing short and lorrg-term hrdebtedness (the "[lxisti:rq l,osr ") a notice
(an "hlxistiug Loan Notioc") prepared by Parent, in fomr and substance reasonably acceptable to
tlre Company, notiffing each of the Existing Loan Lenders of this Agreernent and the
contemplated Merger. At Parent's election, the Existing Loan Notice with respect to one or
more of the Existing Loan Documents rnay include a request for a cotrsent, in form and
substance reasouably acceptable to the Company (an "[xisting l-oan Colsenl"), to (l) the
consummation of the Merger and the other tlansactions contemplated by this Agreement, and
(2) certain modifications of (or waivers under or othel ohanges to) the Existing Loan Docurnents;
providqd, that no such modifications, waivers or changes shall be effective prior to the Effective
Time.
ARTTCLE VI
CONDITIONS PRECEDENT
Section 6.1 Conditions to Each Party's Obli*aiiop to Efl'cct tlre }ilcrqer:, The
respeotive obligations of each party heleto to effect the Closing shall be subject to the
satisfaction (or waiver, if perrrrissible under applicable Law) on or prior to the Closing Date of
the following conditions:
(a) Con:panJr Shareirolder ,Appro\,.a]. The Corirpany Shareholder Approval
shall liave been obtained.
(b) llsgLrlatorl' Approvals. AII waiting periods (and any extensions thereof)
applicable to the Merger under the HSR Act shall have been terrninated ol shall havc expired and
1,<F.1942,1794
44
Joint Application
Dockct No. l6-057-01
Exhibit 1.1
the Required Statutory Approvals shall have been obtained at or prior to the Effective Tirne (the
termitratiorr or expiration of such waiting periods and extensions thereof, together with the
obtaining of the Required Statutoly Approvals, the "Reguliltorv Alrprovals").
(c) No lrr-iunctions. No Law enacted, promulgated, issued, entered, amended
or enforced by any Governmental Authority shall be in effect enjoining, restraining, preventing
ol prohibiting cousuulmation of the Merger or making the consummation of'the Merger illegal.
Section 6.2 Contlitions to Oblisations of Parcnt and Nlereer SuU. The obligations
of Parent and Merger Sub to effect the Closing are further subject to thc satisfaction (or waiver,
if pernrissible under applicable Law) on or prior to the Closing Date of the following conditions:
(a) llcpressntations arrd \Uar-rantics. (i) Each of the representations and
warranties of the Cornpany set forth in this Agreement (other than the representations and
warranties of the Conipany set forth in Section 3.2(a), Section 3.2(b), Section 3.2{c), Sectiott
3.3(a), Scction 3.6(b) and Secliorr 3.19) shall be true and correct (without giving effect to any
liuritatiou as to "lrateriality" or "Cornpany Material Adverse Effect" set forth therein), except
where the failure to be tlue and correct has not had or would not leasonably be expected to have
a Company Material Adverse Effect; (ii) each of the representations and wau'anties of the
Conipany set forth in Sectiotr_3,21i[, Section 3.?(ll) $Eqlien_12{q), Section J.3fa) and Section
3.19 shall be true and correct in all material respects; and (iii) the representations and wan'anties
set forth in licutiun 3.6(b) shall be true and correct in all respects; in the case of eaclt of clause
(i), (ii) and (iii), as of the date of this Agreement and as of the Effective Time as thoLrgh rnade at
and as of the Effective Time (except to the extent that such representation and warranty is
expressly rnade as of a specified date, in which case such representation aud warranty shall be
true and correct as of suclr specific date).
(lr) Perlbrn:anqg, qI' Qovenqnts .a-r-rd, _Agr:qer!9nts of tlte Cornpan),. The
Company shall have perfolnred in all rnaterial respects al1 covenants and agreements required to
be performed by it under this Agleement at or prior to the Closing Date.
(c) Ol'ljcer's Cleltillcate. Parent shall have received a certificate signed on
bchalf of the Company by an executive officer of the Company certifying the satisfaction by the
Company of the conditions set forlh in Scction 6.2(a) and Section L2{h).
(d) AbS"Up-eiql--_Co[pany Material Adverse Effect, Siuce the date of this
Agrecment, therc has not been any circumstance, development, change, event, occul'reuce or'
efi'ect that lTas had or rvould reasonably be expected to have a Company Material Adverse Effect.
(e) Abscucs o1'Burdcusonrc Couciition. No Law or any Regulatory Approvals
shall irnpose or require any undertakiugs, ter'rls, conditions, liabilities, obligations, cornmitments
or sanctions, ol' any structural or temedial actions (including any Remedial Actions) that
constitute a Burdensotlc Condition.
Section 6.3 Csnditions to Obligntiops of thc Conrpany, Tire obligation of the
Cornpany to effect the Closing is fufther subject to the satisfaction (or waiver, if permissible
under applicable Law) on ol prior to the Closing Date of the fbllowing conditions:
r<E 39423794
45
Joint Application
Docket No. 16-057-01
Exhibit 1.1
(a) Represcntatious and Warrarrties, The representations and waranties of
Palent and Merger Sub set forth in this Agreenent shall be tlue and correct (without giving
effect to any limitation as to "materiality" ol' "Parent Material Adverse Effect" set forth therein)
as of the Effective Time with the same effect as though made on and as of the date of this
Agreement and as of the Effective Tirne (except to the extent that such replesentation and
warranty expressiy speaks as of an earlier date, in which case suclt representation and waranty
shall be true and corLect as of such earlier date), except where the failure to be true and correct
has not had or would not reasonably be expected to have a Parcnt Material Adverse Effect.
(b) Perlbrmance of Covenants and Asreements of Par-cnt-s:"xi".Mg$gl*E!b.
Parent and Merger Sub sirall have petfonned in all rnaterial respects all covenants and
agreements requiled to be perfonned by them under this Agteement at or priot to the Closing
Date.
(c) Offieer's Certificate. The Company shall have received a ceftificate
signed on behalf of Parent by an executive officer of Parent certifying the satisfaction by Parent
and Merger Sub of the conditions set forth in Section 6.3(a) and Section 6.3(b).
Section 6.4 Frustratiqn qf Closins Conditions. None of tlre Company, Parent or'
Merger Sub rnay rely on the failure of any condition set forth in Section 6.1, Section 6.2 or
Section 6.3, as the case may be, to be satisfied if such failure was primarily caused by such
party's breach of this Agreement,
ARTICLE VII
TERMINATION
Section 7.1 Termination. This Agtccment rnay be tenninated and the Transactiotrs
abarrdorred at any time prior to the Effective Time:
(a) by the mutual written consent of the Cornpany and Parent; or
(b) by eithel of the Cornpany ol' Parent:
(i) if the Mergel sliall not have been consummated on or before
February 28,2017 (the "E!d_D_sIq"); provicled that if, prior to the End Date, a1l of the
conditions to the Closing set forth in Article VI have been satisfied ot waived, as
applicable, or shall then be capable of being satisfied (except for any condition sst forlh
in Sccliru*(y.![$ or Section 6.1(c) or Scction 6.2(e)), eithel the Company or Parent rnay,
priol to 5:00 p.rn. Salt Lake City, Utah time orr the End Date, extend the End Date to a
date that is not later than six (6) months after the End Date (tlre "[nitial l]xtensirrrr
Periocl"); plovidcd, furthet, that if, prior to the 5:00 p.m., Salt Lake City, Utah time on
the date that is the last day of the Initial Extension Period, all of the conditions to the
Closing set forth in Arlicle VI have been satisfied or waived, as applicable, or shall then
be capable of beirrg satisfied (except for any oondition set forlh in Scctirin 6, l(c-)), the
Cornpany may, prior to 5:00 p.m. Salt Lalce City, Utah tirne on the iast day of the lnitial
Extension Period, extend the End Date to a date that is not later than three (3) months
after tlie date that is the last day of the Initial Extension Period (and if so extended, such
later date shall then, for all purposes under this Agreement, be the "[!d_D$q"); r:rovided,
KE 39423794
46
Joint Application
Docket No. 16-057-01
Exhibit l.l
fi;fther, that neither the Cornpany nor Parent nray terminate this Agleernent ot extend the
End Date pursuantto this Section 7.1(b'l(i) if it (or, in the case of Parent, Merger Sub) is
in breach of this Agreement and such breach has prirnarily caused or resulted in cither ( I )
the failure to satisfy the conditions to its obligations to consummate tlie Closing set forth
in Articlc VI prior to the End Date or (2) the failure of the Closing to have occurred prior
to the End Date;
(iD if any Law having the effect set forlh in Section 6.1(c) sliall not
have been reversed, stayed, enjoined, set aside, annulled or suspetrded and sha1l be in ftlll
force and effect and, in the case of any t'uliug, decree, judgrnent, injunction or order of
any Governmental Authority (each, a "Restrairrt"), sllall have becorne final and non-
appealable; nrov-ided. lrowever, that the right to terminate tliis Agreement under this
Section 7,1(b)(ii) shall not be available to a party if tlre issuance of such final, non-
appealable Restraint was prirnarily due to a breach by such party of any of its covenants
or agreements under this Agreernent, including putsuant to Section 5.4:
(iii) if the Company Shareholder Approval contemplated by this
Agreement shail not have been obtained at the Cornpany Shareholders Meeting duly
convened (including any adjournments or postponernents thereof); or
(c) by Parent:
(i) if the Company shall have breached or failed to perform any of its
representations, warrartties, covenants or agreements set forth in this Agreement, which
breach or failure to perform (A) would give rise to the failure of a condition set forth in
Section 6-2(a_) or Section 6.2(b), respectively, and (B) cannot be cured by the Company
by the End Date or, if capable of being cured, shall not have been cured within thirty (30)
calendar days following receipt of written notice from the Parent stating the Parent's
intention to terminate this Agreernent pursuant to this Section 7.1(cXi) and the basis for
such termination; plgy!$.qd that Parent shall not have the right to terminate this
Agreement pursuant to this Section 7.1(cX!) if it or Merger Sub is then in material breach
of this Agreement; or
(ii) if the Company Board (or a duly autliorized committee thereof)
shall have effected a Company Adverse Recommendation Change; proviri{I, hewqy,$,
that Parent sha1l not have the right to terminate this Agreernent under this ,Seqltia[
7.1(c)(ii) if the Company Shareholdet Approval shall have been obtained; or
(d) by the Cornpany:
(i) if Patent or Merger Sub shall have breached or failed to perfbnn
any of its representations, warranties, oovenants ot agreements set forth in this
Agreernent, which breach or failure to perform (A) would give rise to the faihre of a
condition set forlh in Section 6.3(a) or Section 6.3(b), respectively, and (B) cannot be
cured by Parent or Merget Sub by the End Date or, if capable of being cured, shall not
have been cured within thirly (30) calendar days following receipt of written notice from
the Cornpany stating the Company's intention to tenniuate this Agreernerlt pursuant to
KE 39423194
47
Joint Application
Docket No. l6-057-01
Exhibit l.l
this $ec-tion 7.1(d)(i) and the basis for such temrination; provided that, Company shall not
have tlte right to terminate this Agreement pursuant to tlris Section 7.1 (d)[i) if it is then in
material breach of this Agleernent; or
(iD prior to the receipt of the Company Shareholder Approvai, if the
Company Board shall have efl-ected a Cornpany Adverse Recommendation Change with
respect to a Superior Proposal in accordance with Scction 5.3 and shall have approved,
and concunently with the tennination hereunder', the Cornpany shall have entered into, a
Compatiy Acquisition Agleement with respect to such Superior Proposal; providod that
such tetmination pursuant to this Scgtion 7J(dxiil. shall rrot be effective and the
Compauy shall not enter into any such Company Acquisitiorr Agreernent, unless the
Cornpany has paid the Company Termination Fec to Parent or causes the Company
Termination Fee to be paid to Parent substantially concurently with such termination in
accordance with Section 7.3; (-pleyrdgd that Parent shall have pi'ovided wiring
iustruotions for such payment or, if rrot, then such payrneut shall be paid promptly
following delivery of such instructions).
Section 7.2 Effect of Termination. In the event of the termination of this Agreement
as provided in Section 7.1., written uotice thereof shall be given to the other parly or parties,
specifying tlie pi'ovision hereof pursuant to which such ter:nination is made, and this Agreement
shall forthwith become null and void and have no further force or effect (other than Section
5,6(b), Section 7.2 and Section 7.3, and Article VIII, all of which shall survive terrnination of
this Ageement), and there shall be no liability on tlie part of Parent, Merger Sub or the Company
or their respective directors, officers, other Representatives or Affiliates, whether arising before
or after such termination, based on, arising out of or relating to this Agreement or the
negotiation, execution, performance or subject matter hereof (whether in contract or in tort or
otherwise, or whether at law (including at comnlon law or by statute) or in equity); plovided.
holvever, that, subject to SesLion 7.3 (including the limitations on liability contained therein), no
party shall be relieved or released from any liabilities or damagcs arising out of any willful and
rnaterial breach of this Agreernent prior to such terrnination that gave rise to the failure of a
condition set forth in AEtSb_._Vl ol as set forth in the last serrtence of this Le-St!_o_!_7_,2. The
Confidentiality Agreement shall survive in accordance with its terms following termination of
this Agreement. Without limiting the meanirg of a willful and material bleach, the parties
acknowledge and agree that any failure by a party heleto to consummate the Merger and the
other transactions contemplated hereby after the applicable conditions to the Closing set forth in
Article VI have been satisfied ol waived (except fbr those conditions that by their nature are to
be satisfied at the Closing, which conditions would be capable of being satisfied at the tinre of
such failure to corrsumrnate the Merger) shall constitute a willful and r:raterial breach of this
Agreement.
Section 7.3 ComJrany'fcrmirration Fee.
(a) In the event that this Agreement is terninated by the Company pulsuant to
Section 7.1(d)(ii), the Company shall pay or cause to be paid as directed by Parent the Cornpany
Teunination Fee substantially concurrently with the termination of this Agreenrent.
KE 39423794
4B
Joint Application
Docket No. l6-057-01
Exhibit I .l
(b) In the event that this Agreernent is terrninated by Parent putsuant to
Section 7.1(cXji), the Cornpany shall pay or cause to be paid as directed by Parent the Company
Temination Fee within two (2) Business Days of such tennination.
(c) In the event that (i) this Agreement is teuninated (A) by Parent or the
Comparry pursuant to Sectiorr 7,1(b)ti) ot Section 7.1(bXiii) or (B) by Palent put'suant to $gql!"st-!
7.lLcXi) (solely with respect to a bteach or failure to perfolm a covenaut), (ii) a Takeover
Proposal shall have been publicly disclosed or rnade to thc Company after the date ltereof and
not publicly withdlawn (x) in the case of termination pursuant to "$SgIArl-Z-[IbXil ot Scctie:]
7.1(cXi), prior to the date of such tennination, or (y) in the case of termination pursuant to
$ection 7.1(bXiii), prior to the date of the Company Shareholder Meeting, and (iii) within twelve
(12) rnonths of the date this Agreement is terminated, the Cornpany enters into a Cornpany
Acquisition Agreement ol consun:unates a Takeover Proposal (I:&yl1!.gd that for purposes of
clause (iii) of this $ection 7.3(q), the references to "l5oZ" in the definition of Takeover Proposal
shall be deemed to be references to "50yo"), then the Cornparry shall pay or cause to be paid as
directed by Parent the Cornpany Tennination Fee on the earlier of tlie date of entry into a
Company Acquisition Agreement or consummation of such transaction and such amount, if any,
paid pursuant to this Sec.tion 7.3Jc) shall be reduced by the amount paid, if any, pursuant to
$ssliqu-Z.3(el.
(d) Fol purposes of this Agreement, "Corlrpany "le.rnrinatic'rrt ljeq" shall mean
an antount equal to $99,000,000.
(e) hr the event that this Agreement is terminated by Parent ol the Company
pursuant to Scction 7.1(bLiii), then the Company shall pay or cause to be paid as directed by
Parent, the reasonable costs, fees and oxpenses incurred by Parent, its Affiliates and their
Representatives in connection with the investigation, due diligence, documentation and
negotiation of this Agreement, such arnount not to exceed $5,000,000. In the event the foregoing
payment is paid and a Cotnpany Termination Fee is thereafter payable pursuant to Section 7.3(p),
the Cornpany Telmination Fee otherwise payable shall be reduced by the amount of such
payment.
(0 Parent shall pay to the Company an amourlt equal to $154,000,000 (the
"Parent'l"ermination liee") if this Agteement is terminated:
(A) by Parent or the Company pursuant to Scction 7.1&XD and, at
the time of such termination, (l ) the condition set forth in .Scc:qipj1-62(p)
has not bsen satisfied with respect to one or lnore Regulatory Approvals,
(2) any of the conditions set forth in Sectip_r_r.6..1{_bJ or Se ction 6, I (c) have
not been satisfied, provided that such failurc to bc satisfied relates solely
to a Regulatory Approval as to which the condition set folth in Section
6,2(e\ has not been satisfied, and (3) all of the conditions set forth in
Sectiort 6. I (a) and $ssltq.$.6,2(a), 6.2h\ and 6.2(d) shall have been
satisfied; or
(B) by Parent ot the Compalty pu1'suant to Section 7.1{b)iii) aud, at
the time of such termination, (l ) the condition set fbrth in Section 6,!(ti)
KE39423'794
49
Joint Application
Docket No. l6-057-01
Exhibit 1.1
has not been satisfied witli lespect to one or lnore Regulatory Approvals,
(2) the applicable Restraint giving rise to such tennination relates solely to
a Regulatoly Approval as to which the condition set forth in Scciion 6.2(e)
has not been satisfied, and (3) all of the conditions set forlh in SsEilU
6,1(a) arid Se ctions 6,2(a), 6.2(b) and 6,2(.d) shall have been satisfied; or
(C) by the Company pursuant to Scctiorr 7.1[dXi) due to a material
breach by Parent ol Merger Sub of its obligations under Section 5.4 (if,
and only if, such breach has prirnalily caused tlie failure of any Regulatory
Approval to be obtained) and, at the time of such teunination, all of the
conditions set forlh in Secti.crn 6. I (a), Section 6.1(c) (except any failure of
the condition set fofth in $ection 6.1(q) to be satisfied primalily caused by
a rnaterial breach by Parent or Merger Sub of its obligations under Section
5.4 that has primarily caused the failure of any Regulatory Approval to be
obtained) and $ggiiolls_62k), 6.2(.b) and 6.2(d) shall have been satisfied.
Parent shall pay the Parent Teunination Fee to the Company (to an account designated in writing
by the Company) no later than two (2) Business Days after the date of the applicable tennination.
(g) Notwithstanding the foregoirrg, in no event shall the Company be required
to pay the Company Termination Fee on more than one occasion. Notwithstanding anything to
the contrary in this Agreeurent, the parties agree that if this Agreement is tenninated under
cilcumstances in which the Company is obligated to pay the Cornpany Termination Fee under
this Section 7.i and the Conrpany Tennination Fee is paid, the payment of the Company
Termination Fee shall be the sole and exclusive rernedy available to Parent aud Merget Sub with
respect to this Agreement and the Transactions, and, upon payment of the Corrpany Termination
Fee pursuant to this Section 7.J, the Cornpany (arrd the Company's Affiliates arrd its and their
respective dilectors, officers, employees, shareholders and other Representatives) shall have no
furtirer liability with respect to this Agreement or the Transactions to Parent, Merger Sub or any
of their lespective Affiliates or Representatives. In no event shall Parent be requiled to pay the
Parent Tenniuation Fee on more than oue occasion. Notwithstanding anything to tlie contrary in
this Agreenrent, the parties agree that if this Agreement is tenninated under circumstances in
which Parent is obligated to pay the Palent Telminatiorr Fee under this Section 7.3 and the Palent
Terminatiorr Fee is paid, the payment of the Parent Termination Fee shall be the sole aud
exclusive remedy available to the Company with respect to this Agreement and the Transactions,
and, upon paymcnt of the Parent Termination Fee pursuant to this $gctiQa,ZJ, Parent and Merger
Sub (and theil Affiliates and their respective dilectors, officers, ernployees, shat'eholders and
other Representatives) shall have no furlher liability with respect to this Agreement or the
Transactions to the Cornpany ol arly of their respective Affiliates or Representatives.
(h) Any amount that becomes payable pursuant to Section 7.3 shall be paid by
wile transfer of inrmediately available funds to an account designated by Parent or the Company,
as applicable, and shall be leduced by any amounts required to be deducted or withheld
thelefi'om under applicable Law in lespect of Taxes.
t<D 39423'794
50
.Ioint Application
Docket No. l6-057-01
llxhibit I .1
ARTICLE VIII
MISCELLANEOUS
Section 8.1 No Sulvival of Renresentations and Warranties. None of the
representations and warranties in this Agreement or in any instrument delivered pursuant to this
Agreement shall survive the Effective Time and all r'ights, claims and causes of action (whether
in contmct or in tort or otherwise, or whether at Law (including at common law ol by statute) or
in equity) with respect thereto shall terminate at, the Effective Time. 'fhis Sectign 8,i. shall not
limit any covenant ol' agreement of the parties that by its terrns contemplates perfonnance in
whole or in part after the Effective Time. 'fhe Confidentiality Agreenrent shall (a) survive
termination of this Agreement in accordance with its terms and (b) terminate as of the Effective
Time.
Seetion 8.2 fees and Expense.s. Except as otherwise provided in Section 5.8, Section
7,3 and Section 8,14, whether or notthe Transactions are consummated, all fees and expenses
incumed in connection with the Transactions and this Agreernent shall be paid by the party
inourring or required to incur such fees or expenses.
Section 8.3 Alrrcndm*nt or Sutrlllernrcilt. At any titne prior to the Effective Time,
this Agreement rnay be arnended or suppletnented irr any and all respects, whether before or after
receipt of the Company Shareholder Approval, by written agleement of the parties hereto and
delivered by duly anthorized officers of the respective parties; orovided. howeve,r, that (a)
following receipt of the Company Shareholder Approval, there shall be no amendment or change
to the ptovisions hereof which by Law would require furthel approval by the shareholders of the
Company without such approval and (b) after the Effective Tirne, this Agreelnent may not be
amended or supplenrented in any respect. Notwithstanding anlhing to the contrary contained
Iterein, this Sectiorl 8.3 and Seclials 8,7, 8.8(d) and 8.10 may not be amended, supplemented,
waived or otherwise rnodified in a marurer adverse to the Financing Sources without the prior
written consent of the Financing Sources,
Section 8.4 Waiver. At any time prior to the Effective Time, any party may, subject
to applicable Law, (a) waive any inaccuracies in the reptesentations and warranties of any other
party hereto, (b) extend the tirne for the perfounance of any of the obligations or acts of any
other party hereto or (c) waive compliance by the other party with any of the agreements
contained herein or, except as otherwise provided herein, waive any of such party's conditions.
Notwithstanding the foregoing, no failure or delay by the Company, Parent or Mergel Sub in
exercising any right hereuuder shall operate as a waiver theleof nor shall any single or partial
exercise thereofpreclude any other or further exercise tliereofor the exercise ofany other right
het'eunder. Any agreement on the pafi of a party hereto to any such extensjon or waiver shall be
valid only if set fortlr in an instrumer.rt in writing sigrred on behalf of such party,
Section 8.5 Assiqnment. Neither this Agreement nor any of the rights, interests or
obligations hereunder shall be assigned, in whole or in part, by operatiorr of I-aw or otherwise, by
any of the parties without the prior written consent of the other palties. Subject to the preceding
sentenoe, this Agreernent shall be binding upon, inure to the benefit of, and be enforceable by,
the parties hereto and their respective successors and pelmitted assigns. Arry purported
assignrnent not pernritted under this Section shall be null and void.
5l
KT.39423794
Joint Application
Docket No. l6-057-01
Exhibit 1 .l
Section 8.6 Counterparts. This Agreement may be executed in counterparts (each of
which shall bc deerned to be an original but all of which taken together shall constitute one and
the same agleement) and shall becorne effective when one or rrore counterpafts have been
signed by each of the parties and delivered (by electronic communication, facsimile or
otherwise) to tlie other parties.
Section 8.7 Entirc Agrcemenl: 'I'hird.Partv Bercficiarie.s. This Agreement,
including the Company Disclosure Sclredule, and the exhibits hereto, together with the other
instllrrnents leferred to herein, including the Confidentiality Agleernent (a) constitute the entile
agreement, and supersede a1l other prior agreements and understandings, both written aud oral,
alnong the parties, or any of them, with respect to the subject matter liereof and thereof and (b)
except for (i) the rights of the Company's shaleholdets and holders of Company RSUs,
Conrparry Perfolmance Share Awards, Cornpany Restricted Shares, Company Stocl< Options and
Company Awards to receive the Merger Consideration and payments pursuant to fuliqle ll.
respectively, (ii) the riglrt of the Corrpany, on behalf of its shareholders, to pursue darnages in
the event of Parent or Merger Sub's willful and material bleach of this Agreernent, in whicli
event the damages recoverable by tlre Company for itself and on behalf of its shareholdets
(without duplication) shall be determined by reference to the total amount that would have been
recoverable by the holders of the Cornpany Commorr Stoch (including, "lost premium" and time
value of money) if all such holders brought arr action agairrst Parent and Merger Sub and were
recognized as intended third party beneficiaries heteunder, which right is hereby acknowledged
and agreed by Parent and Merger Sub, (iii) the provisions of Section 5,8, and (iv) the rights of
the Financing Sources and their respective successors, legal replesentatives aud pennitted
assigns under the provisions of Sections 8.3, 8.7, 8.8(.d) and 8,10 in each case, is not intended to
and shali not confer upon any Person other than the parties hereto any rights or remedies
hereunder.
Section 8.8 (Jovqrning [,*wl ,Iurisdiction.
(a) This Agreernent shall be governed by, and construed iu accordance with,
the laws of the State of Delawale, without giving effect to any choice ol conflict of laws
provision or rule (whether of the State of Delaware or any other jurisdiction) that would cause
the application of the Laws of any jurisdiction otlrer than the State of l)elaware, except tbat
matters telated to the fiduciary obligations of the Cornpany Boatd and matters that are
specifically required by the URBCA in connection with the Transactions shall be governed by
the laws of the State of Utah.
(b) Each of the parties (i) irrevocably subrr.rits itself to the pelsonal
jurisdiction of each state or federal court sitting in the State of Delaware, as well as to the
jurisdiction of all courts to which an appeal rnay be taken fi'om such courts, in any suit, action or
proceeding arising out of or lelating to this Agreement or any of the transactions contemplated
herein, (ii) agrees that every such suit, action or prooeeding shall be brought, heald and
determined exclusively in the Court of Charrcery of the State of Delaware (provided that, irr the
event subject mattel jurisdiction is unavailable in or declined by the Court of Clrancery, then all
such claims shall be brought, ireard and detennined exclusively in any other state or federal court
sitting in the State of Delaware), (iii) agrees that it shall not atternpt to deny or defeat such
personal jurisdiction by motion ol other request fol leave fi'orn such coult, (iv) agrees uot to
t<0,39423194
52
.loint Application
Docket No. l6-057-01
Exhibit 1.1
bring any suit, action or proceeding arising out of or relating to this Agreernent or sny of the
transactions contemplated hereiu in any otiter coutt, and (v) waives arry defense of inconvenient
forum to the maintellance of any suit, action or proceeding so brought.
(c) Each party irrevocably conserrts to tire service of process outside the
tellitorial jurisdiction of the courts referred to in this Scction 8.8 in any such action or
proceeding by rnailing copies thereof by registered or certified United States mail, postage
prepaid, I'eturn receipt requested, to its address as specified in or pursuant to this Article VIII.
HoweveL, the foregoing shall not lirnit the right of a party to effect service of process on the
other party by any other legally available method.
(d) Notwithstanding anything contrary in this Agreement, (i) each of the
parties agrees that it will not, and will not pennit its Affiliates to, bring or support any action,
cause of action, ciaim, uoss-claiur or third-party claim of any kind or description, whether in law
or in equity and whetlrel in contract or in tolt or otherwise, against the Financing Sources in any
way related to this Agreemetrt or arly of the Transactions (including any dispute arising out of or
relating to the Transaction Financing or the perfortnance thereof) in any forum other than the
United States District Court I'or the Southern District of New York or the Suprerne Court of the
State of New York, New York County, Iocated in tlie Borough of Manhattan or, in either case,
any appellate court thereof and (ii) the Company agrees that it and its Affiliates and
Representatives will not have any rights or claims against any Financing Source (in its capacity
as such) in corurection with this Agreement, the Transaction Financing or tJre tralrsactions
contemplated hereby ol thereby, and no Financing Source will have any rights or claims against
the Comparly or arly of its Affiliates or Representatives in connection with this Agreement, the
Transaction Finaucing or the transactiotrs conternplated hereby or therrby, whether at lal or in
equity, in contract toft or otherwise, and in addition, in no event will any Financing Source be
liable for consequential, special, exetnplary, punitive or indirect damages (includiug any loss of
profits, business or anticipated savings) or damages of a tortious nature, except to the extent paid
in cor:nection with a claim by a third party. The parties hereto further aglee that all of the
provisions of Seotion 8.10 relating to waiver ofjury trial shall also apply to any action, cause of
action, claim, cross-claim or third party-claim referenced in this paragraph.
Section 8.9 Specilic llnlbrternent. The parties agree that immediate, extensive and
ineparable damage would occur for which monetary damages would not be an adequatc rernedy
ilr the event that any of the provisions of this Agrcement are not performed in accoldauce with
their specific terms or are otherwise breached. Accordingly, the pafties agree that, if lbr any
reason Parent, Mergcr Sub or the Cornpany shall have failed to perfonn its obligations under this
Agreemeut or otherwise breached this Agreeurent, then the party seeking to enforce this
Agreernent against such nonpet'forming party under this Agreement shall be erititled to specific
performance and the issuance of immediate injunctive and other equitable relief without tl-re
necessity of proving the inadequacy of mouey damages as a m:edy, and the parties further agree
to waive any requirement for the securing or posting of any bond in conr:ection with the
obtaining of any such injunctive or othel equitable lelief, this being in addition to and not in
limitation of any other remedy to which tltey are entitled at Law or in equity. lf any parly hereto
brings any Claim to enforce specifically the perforrnance of tlie terrns and provisions of this
Agreement when expressly available to such party pursuant to the terms of this Agreement, then,
notwithstanding anything to ilre contraly helein, the End Date shall automatically be extended by
t<E 39421-194
53
Joint Application
Docket No. l6-057-01
Exhibit 1.1
the period of time between the commencement of such Clairn and ten (10) Business Days
following the date on which such Claim is fully and finally resolved.
Section 8.10 WAMR OF JURY TRIAL. EACII PARTY IIEREBY WAIVES,
TO TITE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT
MAY HAYE TO A TRIAL BY JURY IN RESPECT OF' AI{Y SUIT, ACTION OR
OT}IER PROCEEDING ARISING OUT OF TIIIS AGREEMENT OR TIIE
TRANSACTIONS. E,ACH PARTY (A) CERTIFIES THAT NO REPRESENTATIVE,
AGENT OR ATTORNEY OTI A}IY OTHER PAR Y HAS REPRESENTED,
EXPRESSLY OR OTIIERWISE, TIIAT SUCH PARTY WOULD NOT, IN TIIE EVENT
OF AI\T-Y ACTION, SUIT OR PROCEEDING, SEEI( TO ENFORCE TIIE F.OREGOING
WAIVER AND (B) ACISIOWLEDGES THAT IT AND TIIE OTIIER PARTTES IIAVE
BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTIIER
TIIINGS, THE MUTUAL WATVER AND CERTTFICATIONS IN TIIIS SECTION 8.10.
Section 8.11 Notiees. All notices, requests and other communications to any party
hercunder shall be in writing and shall be deemed given if deliveled pelsonaily, facsirniled
(which is confirmed) or sent by oveniight courier (providing proof of delivery) to the parlies at
the foIlowing addlesses:
If to Parent or Merger Sub, to:
Dominion Resources, lnc.
120 Tredegar Street
Riclmrond, YA232l9
Attention: Mark O. Webb, Vice President, Ceneral Counsel and Chief Risk
Officer
Facsirn ile: (804) 819 -2233
with a copy (whicli shall not constitute notice) to:
McGuireWoods LLP
Gateway Plaza
800 East Canal Street
Richrnond, V A 23219-39 I 6
Attention: Joanne I(atsantonis
John L. Hughes, Jr.
Facsimile: [phone]
If to the Company, to:
Questar Corporation
P.O. Box 45433
333 South State Street
Salt Lahe City, UT 84145-0433
Atteution: Kevin Hadlock, Chief Financiai Officer'
Colleen Larl<in Bell, Vice President and General Counsel
Facsirnile: [phone]
KE 39423794
54
.Ioint Application
Dookct No. I 6-057-01
Exhibit 1.1
with a copy (which shall not constitute notice) to:
Kirkland & Ellis LLP
601 Lexington Avenue
New York, New Yolk 10022
Attention: George P. Stamas
Alexander D. Fins
Brendan J. Reed
Facsimile: [phone]
or such other address or facsirnile number as such party may hereafter specify by like notice to
the other parties hereto. All such notices, t'equests and other couttnutrications shall be deemed
received on the date of receipt by the reoipient theleof if received prior to 5:00 p.rn. in the place
of receipt and such day is a Business Day in the place of receipt. Otherwise, any such notice,
request or comrnunication shall be deemed not to have been received until the next succeeding
Business Day in the place of receipt.
Section 8.12 Severabilitv, If any term or other provision of this Agreernent is
detennined by a court of competent jurisdiction to bc invalid, illegal or incapable of being
enforced by any rLrle of law or public policy, all other terms, provisiorrs and conditions of this
Agreement shall nevertheless remain in full force and effect. Upon such deterrnination that any
term or other provision is invalid, illegal or incapable of being enforced, the parlies hereto shall
r-regotiate in good faith to rnodify this Agreement so as to effect the original intent of the parties
as closely as possible to the fullest extent pennitted by applicable law in an acceptable manner to
the end that the'l'ransactions are fulfilled to the extent possible.
Section 8.13 Delinitions. As used in this Agreernent, the following tems shall have
the meanings ascribed to thern below:
".r\occ.Jl.tablg_S.pttfi:lmtiAlilf__A"gfqeJ1-Cnt" shall mean a confidentiality agreement (which
need not plohibit the making of a Talceover Proposal) that contains provisions that are not
rnaterially lcss favorable in the aggregate to the Compariy than those contained in the
Corrfi denti al ity A gr eement.
"Aq_qqlUde!_qd_D"lvid94dg" shall mean all dividends declaled by the Cornpany with
lespect to shares of Company Common Stock, and all dividend equivalent payments, in each
case, relating to Cornpany RSUs and Cornpany Awards that have been accumulatcd or retained
by the Cornpany until the vesting or settlement of such awards.
"41-l]_lia!s" shall mean, as to any Person, any other Person that, directly or indirectly,
controls, or is controiled by, or is rurder cornrnon control with, such Person. For this purpose,
"control" (including, with its correlative ureanir.tgs, "controlled by" and "under cornmou contlol
with") shall rnean the possession, directly or indirectly, of the powel' to dircct or cause the
direction of managerneut or policies of a PeLson, whetlier throLrgh the ownership of securities or
partnership ol othet'ownership interests, by contLact or otherwise.
"Aslccn'lent" shall have the meanitrg set forth in the Preamble.
KE 19421794
55
Joint Application
Docket No. 16-057-01
Exhibit 1.1
"Aunuql Incentive Plans" shall mean the Company's A.nnual Management Irrcentive Plan
and Annual Management Incentive Plan II.
"Aftilu$ IBIryS" shall have the rneaning set forth in Section 5.4(a).
"r\rticles ollMerecf'shall have the rneaning set forlh in Section 1.3.
"Balance Sheet Date" shall have the rneaning set forth in Sectiorr 3.5(d).
"Ilankruplcy lnel-liqrrit.y E.rceplion" shall have the meaning set forth in Section 3.3{a),
"llook-Ently SJU["e*s-" shall have the rneaning set forth in Scction 2.1(c).
"Burdensome *Condition" shall mealr any undeftakings, tems, conditions, liabilities,
obligations, commitments or sanction (including any Remedial Action) that, in the aggregate,
would have or would be reasonably likely to have, a material advei-se effeot on the financial
condition, assets, Iiabilities, businesses or results of operations of the Company and its
Subsidiaries, taken as a whole , or of Parent and its Subsidiaries, talceu as a whole and after giving
effect to the Merger such that Parent and its Subsidiaries for this pr.u'pose shall be deemed a
consolidated group of entities of the size and scale of a hypothetical compally that is 100% of the
size of the Cornpany and its Subsidiaries taken as a whole); plev-idgd, horvever', that any such
undertakings, tenrs, conditions, liabilities, obligations, commitments or sanctions shall not
corrstitute or be taken into account in detern-rining whether there has beeu or is such a material
adverse effect to the extent such undertal<ings, terms, conditions, liabilities, obligations,
commitments ol sanctiorrs are described in Section I .7-
"Ilusiness I)gy" shall mean a day except a Saturday, a Sunday or other day on which the
SEC or banks in Salt Lake City, Utah are authorized or required by Law to be closed.
"eg1lfi_g.d-e," shall have the rneaning set forth in Scctiotr 2. i(q),
"Clailn" shall have the meanirig set forth in Section 5.8(u).
"Class A Pleferred Stock" has the meaning set forth in Sestion 3.2(a),
"Class B Preferred_Stock" has the meaning set fordr in Seclion 3.2(a).
"Clayton Act" shallmean the Clayton Act of 1914.
"(llosing" shall have the meaning sel. forlh in Section 1.2.
"C'losing Date" shall have the rneanilg set forth in SpcUorf_[.2.
'(Code" sliall havc the rneaning set forth in Sg9111gtt_?,2_G).
"Conlpany" shall lrave the meaning set forth in the Preamble.
"llqU1Utty*$jgLrisilion Agleement" shall have the meaning set tblth in Sge"tJ-qI-.5,J[-q).
1<F.39423794
s6
Joint Application
Dockct No. 16-057-01
Exhibit I .1
"Cor:rDanv ArlvcLse llect'lrnrerrdatiorr Clrange" shall have the rneaning set forth in
Section 5.3(c).
"Cornpany Arvard" shall have the meaning set forth in -$cctjo[2f,1d.
"Cp_tUpgLrf_BpAtd." shall have the meaning set fofih in the recitals.
"Corrrpany UoarM" shall have the meaning set forth in Section 3,3(a).
"ConrDalry Charter Docurrrcnts" shall have the meaning set fortlr in Section l.-5.
"Cornpany Conrmon $tock" shall have the meaning set forth in Scction 2.1..
"CourJ:any Disclosure Schedulc" shall have the nreauing set forth in the Alticle ill
Preamble,
"Conrpany l]uployec" shall have the meaning set forth in iiectir:n 5.1 1(n).
"e$]mp*q-rly-*"lU$yC!UUS.*EI_UU" means any circumstance, developuient, change, event,
occumerlce or effect that (1) is unknown to or by the Company Boald as of the date hereof (or if
l<lown, the rnagnitude or material consequences of which were not known by the Cornpauy
Board as of the date of this Agreernent) and (2) becomes l<nown to or by the Company Board
prior to obtaining the Company Shareholder Approval.
"Companv Matcrial Aclvelsc llffecJ" shall mean any circurrrstance, developtnent, change,
event, occurrence or effect that (a) has, individually or in the aggregate, a niaterial advet'se effect
ou the business, properties, assets, liabilities, results of operations ol fmancial condition of the
Conrpany aud its Subsidiaries taken as a whole; irrovided that none of the fbllowing shall
constitute or be taken into account in determining whether a Company Material Adverse Effect
has occurred: (i) any circumstance, development, clrange, event, occurrence or effect in any of
the indu.stries or maLkets in which the Company or its Sr"rbsidiaries operates, including natural
gas distribution, exploration, production or transmissiou industries (including, in each case, any
changes in the operations thereof or with respect to systern-wide changes or developments in
natural gas transurission, exploration, production or distribution systems); (ii) any cnactment of,
change in, or change in interpretation of, any Law or GAAP or governrental policy; (iii) general
econornic, rcgulatory or poiitical conditions (or changes therein) or corrditions (or changes
therein) iir the tinancial, credit or securities markets (including changes in interest or crlrrerlcy
exchange rates) in any country or region in which the Company or any of its Subsidiaries
conducts business; (iv) any chauge in the price of natulal gas or any other raw material, tnineral
or cornmodity used or sold by the Company or any of its Subsidiaries or in the cost of hedges
relating to such prices, any cirange in the price of intei'state nafural gas trausporlation services or
any change in customer usage patterns or custorrer selection of third-party supplicrs for natural
gas; (v) any acts of God, natural disasters, ten'orism, armed hostilities, sabotagc, war or arly
escalation or worsening of acts of tenorism, armed hostilities or wal; (vi) the annorrncellelrt,
pondency of ol pelformance of the Transactions, including by reason of the ideritity of Parent or
any colltllunicatiolt by Parent legarding the plans or iutentions of Parent with respect to the
conduct of the business of tlie Cornpany ot' any of its Subsidiaries and including the impact of
any of the foregoing o11 any relationships, contlactual or otlretwise, witlt custotrrers, suppliers,
KE39423'.794
57
Joint Application
Docket No. 16-057-01
Exhibit I .1
distlibutors, collaboration parlnels, joint venture partuers, employees or regulators; (vii) any
action taken by the Company 01' any of its Subsidiaries that is required or explessly pennitted by
the terms of this Agreement or with the consent or at the direction of Parent or Merger Sub; (viii)
any cirange in the market price, or cirange in trading volume, of the capital stocl< of the Cornpany
(it being understood that the facts or occulrences giving rise or contributing to such change shall
be taken into account in detemrining whether there has been a Company Material Adverse
Effect); (ix) any failure by the Company or its Subsidiaries to meet internal, analysts' or other
earnings estirnates or firrancial projections or forecasts fol any period, or any changes iu credit
ratings and any changes in any analysts recornrnendations or ratings with respect to the Company
or ally of its Subsidiaries (it being understood that the underlying facts or occunences giving rise
to such failule shall be taken into account in determining whether there has beetr a Company
Material Adverse Effect if not otherwise falling within any of the exceptions set forth in clauses
(a)(i) through (a)(viii) or (a)(x) througir (a)(xii) ofthis proviso); (x) any change or effect arising
frorn any rate cases directly related to the Cornpany or any of its Subsidiaries; to the extent
Company cornplied with arid Parent exercised its rights to approve the folegoing pursuant to
Ssctiorr 5.1(d); (xi) any circumstauce, development, change, eveut, occulrence ot effect tliat
results fi'om any shutdown ol suspension of operations at any third party facilities from which
the Cornpany or any of its Subsidiaries obtains natulal gas and (xii) any pcnding, initiated or
threatened Transaction Litigation, in each of clauses (i) through (v), to the exteut that such
circumstance, development, change, event, occurrence or effect does not affect the Compauy and
its Subsidiaries, tal<en as a whole, in a materially disproportionate lnannel relative to other'
siniilarly situated participants in the business and industries in which the Company and its
Subsidialies operate; or (b) rvould, individually or in the aggregate, reasonably be expected to
prevent or materially impede, interfere with or delay the consummation by the Cornpany of the
Transactions.
"Cornp.a.!.ly_I4-Aleg_41_Cet!-[Ac!" shall have the meaning set forth in Section 3.l5(a).
"Compan.y Pcrtsion Plan" shall have the rneaning set folth in Section 3.10.
"Cotnprrny Perionnance Share Awards" slrall mean all performance share awards payable
in shares of Cornpany Comrnon Stock subject to perfortnance-based vesting ol delivery
requirements, whethel granted under a Cornpany Stock Plan or otherwise.
"Conrpany Pernrits" shall have the meaning set forth in Section 3.8.
"Clornpauy I:'lans" shall mean (a) each rnaterial "employee benefit plan" (as such term is
deflned in Section 3(3) of ERISA) that the Company or any of its Subsidiaries sponsors,
participates in, is a party ol contributes to, or with lespect to which the Cornpany or any of its
Subsidiaries could leasonably be expected to have any material liability and (b) each other
material employee benefrt plan, program or auangement, includiug without limitation, any stocl<
option, stock purchase, stock appreciation riglrt or otlrer stocl( or stock-based incerrtive plan, casl'r
bonus ot' incentive compensation arrangelnerrt, retirement ot deferred cornpensation plan, profit
sharing plan, uncmployment ol severance con'rpellsation plan, that the Company or any of its
Subsidiaries sponsors, palticipates il, is a party or contributes to, or with lespect to which the
Company or any of its Subsidiaties could leasonably be expected to have any rnatcrial liability.
KF.39423794
58
Joint Application
Docket No. I 6-057-01
Exhibit 1.I
"Cqlpery_Ilpfelgd_$1qgk" shall have the rneaning set forth in Section 3.2(a).
"*C.p.Epany llestlicted Shm" shall urean all shares of Cornpany Common Stock subject
to vesting restrictions and/or forfeiture bacl< to the Company, whether glanted under a Cornpany
Stock Plan or otherwise.
"Corlnany Rctir@" slrall have the tneaning set forth in Section .5.11(d).
"Company Retircc l-lcrlth Plan" shall have the meaning set forth in Se tion 5,11{cl).
"Cojlpaly*_KSUs" shall mean any share unit payable in shares of Cornpany Common
Stocl< or whose value is determined with reference to the value of shat'es of Company Common
Stock, whether granted under a Company Stoclc Plan or otherwise.
"Corrrpany ,$iic Dqg!ll:Llp-Ll-1$" shall have the meaning set folth in Section 3.,;{4J.
"Conrl:anv Sltarelr.q!.dgl ApProval" shall have the meaning set folth in IiUUgf-3.1_2,
"Cr:rnpany Shareholde rs kleetirtg" shall have the meaning set forth in Sqgtion 5.2{b).
"llqgpitrly*5-togk QJtIoll" shall mean any option to purchase Company Cornmon Stock,
whether granted under a Cornpany Stock Plan or othenvise.
"(lonrparry Str)cL]].!a.!" shall mean tlre Conrpauy's Long-Term Stoolc Incentive Plan.
"..@" shall have the rneaning sct forth in Scction 7.3(tl).
"Confidentialit), Ag.r'eertlqn[" s]rall have the meaning set forth i, Secti*n 5.6[aJ.
"Continuation Period" shall have the mearring set forth in Section 5.I {a)..
"(lorltract" rneans any loan or credit agreentent, debenture, note, bond, moftgage,
indenfure, deed of trust, lease, license, contract or other agreelnent.
"Dissenting Shusllolder" shall have the rneaning set forth in Sgqlia11l.Jft!),
"Drl=s,q:_!!l1ri Sllarcholdc " shall have the nreaning set forlh in Section 2.1(rl).
"l)_i],ision" shall have the rneaning set fortlr in fuqjig!.1.3.
"DMICB" ulearls Dominion Midstlearr-r CP, LLC, a Delaware limited liability collpany.
"Dorniuion Midsk q" shall mean Dorninion Midstreanr Parlners, LP, a
Delaware limited partnership.
"l:llcctiver '1.'irnr-:" shall have the rneaning set forth in Section 1 ,3.
"lilliqitrlq,l!c1il,qc.{" shall have the meaning set folth in "$-e_r*!i_o-fr_5-l l(d).
l<E 3942f794
59
Joint Application
Docl<et No. l6-057-01
Exhibit 1 .1
"i}rcumbrances" shall rxean any rnortgage, deed of trust, lease, liceuse, r'esttiction,
hypothecation, option to purchase or lease ol otherwise acquire auy interest, right of fir'st refusal
or offer, conditional sales ol other title retention agreement, adverse claim of ownership or use,
casemerrt, encroachment, right of way or other title defect, or encuurblance of any kind or nature.
"-D,!d-Date" shall have the meaning set fordr iu Section 7.I (.Lr)(i).
"Envirunnrental [.,aws" lrreans all Laws relating to workplace safefy or' health, pollution
or protection of the environlnent, including without limitation, laws relating to decommissioning
requirements or the exposure to, or Releases or thleatened Releases of, hazardous materials,
substances or wastes as the foregoing arc enacted or in effect on or prior to Closing.
"liquitv Sqqurities" shall have the meaning set forth in Section 3.2{[r).
"ERISA" lneans the Employee Retirement Incorne Security Act of 1974.
".EBlSA_A-f{1.1*i.q1g" means each corporation or trade or business that would be treated as a
singie ernployer with the Company pursuant to Section 4001(bX1) of ERISA.
"Exciranse Act" shall have the meaning set forth in Section 3.4.
"'tixisting I-onn l-enders" shall have the meaning set forth in Sectiqn 5,I6(d)..
"llxisting Loan Notice" shall lrave the meaning set forth in Scctio_n 5.1 6(d)_.
"llxisting l.oan Cr:rrscnt" shall have the meanirrg set forth in Scction 5.16(.d).
"Federal Trade Commission Act" shall mean the Federal Trade Commission Act of 1914.
"Fir)auciqs" shall have the rneaning set forth in Sed_qu,5-[6fu).
"l?inancirrg Sources" shall mean the Persons (including lenders, agents and arrangers) that
at any tirne have committed to provide or otherwise entered into agreements in connection with
any third party debt financing or alternative financings included iu the Transaction Financing,
and auy joinder agreemerrts, indentules or credit agreements entered into pursuant thet'eto or
relating thereto, together with their Affiliates or Representatives involved in the Transaction
Financing and their respective successors and assigns.
"GAAP" shall urean generally accepted accounting principles in the United States.
"Covemurcnlal Autholit.\," shall mean any federal, tribal, state o[ iocal, domestic, foreign,
sovereign or multinational goveurment, court, regulatory or adrninistrative agency, con-uttission,
autholity or oth er govenr m ental instrumentality,
"l-lazaldolg{alerials" means any materials or substances ol wastes as to which liability
ol standards of condtrct nray be irnposed under any Envirorulental Law.
"HSR Act" shall mean the Hart-Scott-Rodino Altitrust Improverretrts Act of 1976.
KE 39423794
60
Joint Application
Docket No. I6-057-01
Exhibir 1.1
"l-lydrocarbons" shall mean oil, natural gas, condensate, Iiquefied natural gas, NGL and
other liquids or gaseous hydrocarbons ol other substances (includirig minerals) produced or
associated therewith, cornbinations or constituents thereof and extractions therefi'om.
"llrclebtcclness" shall lnean, with respect to any Person, without duplication, (a) all
obligations of such Pelson for borrowed money (other than intelcompany indebtedness), (b) all
obligations of such Person evidenced by bonds, debentules, notes or sirnilar instruments, (c) all
obligations of such Person evidenced lry letters of credit, bankers' acceptances or similar'
facilities to the extent drawn upon by the counterparty thereto, (d) all capitalized lease
obligations of such Person and (e) all guarantees or other assumptions of liability for any of the
foregoing.
"Indemnitee(s)" shall have the rneaning set forth in Sgqtiq[ 5.8(d.
"lnLcllectual llrr:perty" shall rllean, in any and alljurisdictions throughout the world, all
intellectual property and ptoprietary rights, and applications with respect thereto, including (a)
patents and patent applications, (b) registered tradernarks, trade nalnes, service marks, logos,
corporate nalnes, intelnet domain names, and any applications fol registration of any of the
foregoing, together with all goodwiil associated with each of the foregoing, (c) registercd and
material umegistered copyriglrts, including copyrights in computer software, mask worl<s and
databases and (d) trade secrets, data, technical infonnation, processes, and other proprietary
know-how.
"lnterests" shall mean, with respect to the Conrpany and its Subsidiaries (a) direct and
indirect interests in and rights with respect to Hydrocarbons and reiated properties and assets of
any lcind and nature, direct or indirect, including working and leasehold interests and operating
rights and royalties, overriding royalties, production payments, net profit interests, carried
interests, and other non-working interests and non-opelating interests; (b) Hydrooarbons or
revenues therefrorn; (c) all Contracts and the leasehold estates created thereby and the lands
covered by the Contracts relating to the Hydrocarbons or inciuded in units with which such
Contracts rnay have been pooled or united; (d) surface interests, fee interests, reversionary
interests, reservations and concessions; (e) all easements, surface use agreements, rights of way,
licenses and permits, in each case, in connection with leases, the drilling of wells ol the
production, gathering, processing, storage, disposition, transportation or sale of Hydrocarbons,
(f) all interests in machinery, equiprnent (including wells, well equiprnent and rnachinery), oil
and gas production, gathering, transmissiou, treatiug, processing aud storage facilities (including
tanks, tank batteries, pipelines, flow lines, gatliering Systerls and metering equiprnent), pumps,
water plants, electric plants, gasoline and gas platforms, processiug plants, compressol' stations,
separation plants, refineries, testing and monitoring equipment, in each case, in connection witlr
any leases, the drilling of wells or the production, gathering, processing. storage, disposition,
transportatiorr or sale of Hydrocarbons, and (g) all other intelests of any kind or character
associated with, appurtenarrt to, or necessary for the operation of any of the foregoing.
"lnitiai Extension Period" slrall have the meaning set forth in
"S-cql1pj1-7.lLb)O.
"lRS" rneans the U,S. InternalRevenue Service.
t<E 39423794
Joint Application
DocketNo. l6-057-01
Exhibit 1 .l
"!*(nq-yylgdgq" shall rnean, (a) in the case of the Company, the actual knowledge of the
individuals listed on Sec.tion 8.13(i) of the Cornparty Disclosure Schedule and @) in the case of
Parent and Mergel Sub, the actual knorvledge of the individuals listed on 5c__c,I!qq$.-13(bl of the
Company Disclosure Schedule.
"Laws" shall have the rneaning set forth in rS__e*q----------------J"1atl,13.
((Llens" shall mean any pledges, liens, charges, Encurnbrances, options to purchase or
lease ol otherwise acquire any interest, and seculity intelests of aly l<ind or nafure whatsoever.
"Mergqf" shall have the meaning set forth in the recitals.
"Mgrg9legl5idc1al_Ul" shall have tlie meaning set forth in Section ?.1(.q).,
"MgtSL-SUh" shall have the meaning set forth in the Prearnble.
"Ncw Plans" shall have the meaning set forth in Section 5.1 l(b).
"Notice of Recorntnendatiou Clrnnge" shall have the meaning set fofth in Section -5.3(d).
"NYSE" shall rnean the New Yorh Stock Exchange.
'"Old Plans" shall have the meaning set forth in Scutir:n 5.1 I (b).
''Pareilt" shall have the meaning set folth iu the Preanrble.
"Parent Ep4Il[" shall mean the board of dilectoLs of Parent,
"Parent Material Adverse Effect" shall u1eal1 any change, deve loprnent, event, occurrence
or effect that, individually or in the aggregate, has had or would reasonably be expected to have a
material and adverse effect on the ability of Parent or Merger Sub to consurnrnate, or that would
reasonably be expected to prevent or materially impede, interfere with or delay the
consumnration by Parent or Merger Sub of the Transactions,
"Parent SEC DocumeuE" shall lnean all registration statentents, repofts, proxy
statements and other documenm of Parent required to be filed with or fumished to the SEC since
January 1,2074, itr eaclr case including all exhibits and schedules thereto and documents
incorporated by leference therein, as such statements, repotts and documents rnay ltave been
amended since the date of their filing,
"PAlcnt Severance Proglarrr" shall have the meaning set forlh in Sectir.,n 5.1 l(a).
"PaLeut'l'eunirrtrlittrr Fce" shall have the meaning set forlh in Section_Z.3$.,
"Poying .Ageut" shall have the meaning set forth in Section 2.2fa).
"PBGC" shall have the rncaning set forth in Section 3.I0.
KE 39423194
62
Joint Application
Docket No. 16-057-01
Exhibit 1.1
"Permitted Encuurbrances" shall rnean (a) zoning, building codes and other state and
federal land use Laws regulating the use or occupancy of such real property or the activities
conducted thereon which are imposed by any GoveLnmental Autholity having jurisdictioir over
such real propefty and (b) easentents, rights-of-way, encroachments, Lestrictions, covenants,
conditions and other similat Encumbrances that (i) are disclosed in the public records, (ii) would
be set forth in a title policy, title report or survey with respect to the applicable real properly or'
(iii) iudividually or in the aggregate, (A) are not substantial in character, amount or extent irr
relation to the applicable real property and (B) do not rnaterially and adversely impaot the
Comparry's cuuent or contemplated use, utility ol vdlue of the applicable real plope(y or
otherwise materially and adversely impait the Cornpany's present or contemplated busincss
operations at such location.
"!qg11j.tted_Lig!!" shall mearr (a) statutory Liens for Taxes, assessments or other charges
by Governmental Authorities not yet due and payable or the amount or validity of which is being
contested in good faith and by appropriate proceedings, (b) mechanics', materialmen's, can'iers',
workmen's, warehouseman's, r'epainnen's, landlolds' and similal Licns granted or which arise iu
the ordinary course of business, (c) Liens reflected in the Company SEC Docurnents, (d)
Pennitted Encunbrances, (e) Liens perrnitted under or pursuant to any Contracts relating to
Indebtedness and (f) such other Liens that would not have a Company Material Adverse Effect.
"Pelsoll" rneans an individual, corporation, lirnited liability cornpany, partrrership,
association, trust, unincorporated organization, other entity or group (as defined in the Exchange
Act), including a Governmental Authority,
"Production IJurclen'o means all royalty interests, overriding royalty interests, production
payments, net profit interests or other similar interests that constitute a burden on, and are
rneasured by or are payable out of, the production ofHydrocarbons or the proceeds realized from
the sale or other disposition thereof (including any amounts payable to publicly traded royalty
trusts).
"Prox.v Staternent" shall have tire meaning set forth in Sectiorr 3.4.
'(PSCfJ" means the Public Service Commission of Utah.
"PSCW" rneans the Public Service Commission of Wyorning.
('P(JCI" rneans the Public Utilities Commission of Idalio.
"Begulgtory Apl:rovals" sltall have the tneaning specified in Seclion 6.1(b).
"l{egulatory liilinss" shallhave the meanitrg sct forth in Section 3.5(-e).
"!-tgJgjl$g" means any release, spill, emission, disc.harge, leaking, pumping, injection,
deposit, disposal, dispersal, leaching or tnigration into the envirorrrient (including, without
limitation, arnbient air, surface water, groundwatel and sulface or subsurface strata) or into or
out of any property, inciuding the movement of Hazardous Materials through or in the soil,
surfacc water or groundwatcr.
I<E 39423794
63
Joint Application
Dooket No. l6-057-01
"Renredial Ac.ti,trt" shall have the nreaning set forth in Section 5.4(cl).,
"Repoltirrg(.0911)qnics" shall have the meaning set forth in Seclion 3.5(a).
"&Ql:rQsenl&tives" means, with resl:ect to any Person, the professional (including
financial) advisors, Financing Sources, attorneys, accountants, consultants 01' other
replesentatives (acting in such capacity) retained by such Pelson or any of its controlled
Affrliates, togethel with dilectors, officers, employees, agents and represeutatives of such Pelson
and its Subsidialies.
"Rqquire_cl $ta " shall have the rneaning set forth
"Iteslraint" shall have the meaning set forth in Section 7.1(bXii),
"Risltts of'Wali" shall have tlle meaning set fofth in _S_,e.qUUU-lJ4(b).
"Salbarres-Oxle.v Ac!" shall lTave the meaning set forth in Sectior: 3.5(a).
"SEC" fileal1s the U.S. Securities and Excharrge Cornmission.
"Securities Act" shall have the rneaning set forth in Section 3.l(b).
"Slrennan Act" means the Shen'nan Antitrust Act of I890.
"Strl:sidiaty'when used with respect to any party, shall rneau al'ly corporatiorr, linrited
liability cornpany, parlnership, associatiolr, trust or other entity of which securities or other
ownership interests representing 50Y, or more of the equity and 50Yo or more of the ordinary
voting power (or, in the case of a limited partnership, more than 50% of the general parlnership
interests) are, as of such date, owned by such party or one or more Subsidiaries of srich party or
by sucl-r party and one or rnore Subsidiaries of such porty.
"fupgggt Prcpg5gl" shall have the meaning set forth in Seclion .5.1fo).
"SurviLlillg Corporation" shall have the rneaning set forth in Seclion I .1 .
"Systerns" shall rnean the oil, natural gas, liquefied natural gas, NGL and otlier pipelines,
lateral liues, pumps, pump stations, storage facilities, terminals, processing plants, distribution
systems, compressors, natural gas vehicle stations and otlrer related operations, assets, rnachinery
and equipment that are owned or used by Company ol' any of its Subsidiaries.
"'laheovcl'Prrlrosat" shall have the meaning set forth in lSglgfff1l).
"Talteover Statute" shall have tl,e meaning set foftlr in SCSUalf 3.J_1,
"'l'i!x Returns" shall have the ureaniug set forth in Sccliorr 3.9(g).
o'Taxes" shall have the meaning set forth in Section 3,9(g).
"Transaotion Iriuancirig" shall have the rleaning set folth irr Sectit:lr 4.6.
t<E 39421794
64
Joint Application
DocketNo. 16-057-01
Exhibit 1 .l
"J'mn.saction Litig,ation" shall have the rneaning set forth in Sectinn 5,?.
"Transactiofls" refers collectively to this Agteement and the transactions contemplated
hereby, including the Merger,
"'l'r'ue-Up Shales" shall have the rneaning set forth in Seotion 2.3(b).
"(IRBCA' shall have the meaning set forlh in the recitals
"White River Hub" means White River Hub, LLC, a Delawate limited liability company.
"White lliver LLC Agreement" shall mean that certain Lirnited Liability Company
Agreement of White River Hub, LLC, dated as of February l, 2008, by and between Questar
Wlrite River Hub, LLC, a Utah lirnited liability compally and Enterprise White River Hub, LLC,
a Delaware limited liability company.
Section 8.14 Transfer Taxes. All transfer, docurnentary, sales, use, starnp, registratiorr
and othel such Taxes and fees (including penalties and interest) incun:ed in connection with the
Transactions shall be paid by Parent and Merger Sub when due.
Section 8.15 Interfrretatiorr.
(a) Time lleriocls. When calculating the period of time before which, within
which or following which any act is to be done or step talcen pursuant to this Agleement, (i) the
date that is the reference date in calculating such period shall be excluded and (ii) ifthe Iast day
of such period is a not a Business Day, the period in question shall end on the next succeeding
Business Day,
(b) Dollars. Unless otherwise specifically indicated, any reference herein to $
means U.S. dollars.
(c) Gettder and Nuntber. Any reference herein to gender shall include all
genders, and words irnparting the singular nuurber only sliall include the plural and vice versa,
(d) Artjcles. .:ccliouE-atd-llgadirrqg, When a refelence is made herein to an
Article or a Section, such leference shall be to an Article or a Section of this Agreement unless
otherwise indicated. The table of contents and headings contained herein are for reference
putposes only and shall not affect in any way the meaning or interpretation of this Agreement.
(") IrTclLrde. Whenever the words "include", "includes" or "including" are
used herein, they shall be deerned to be followed by the words "without limitation."
(0 Hercofl-Defiried 'l'ernrs. The words "hereof," "hereto," "hereby," "herein"
and "hereunder" atrd words of similar impolt when used herein shall refer to this Agreement as a
whole and not to any particular provision of this Ageement. All terrns defined in this
Agreement shall have the defined meanings when used in any document made or delivered
pursuant hereto unless otherwise defined thereiu.
KE 39423't94
65
Joint Application
Docket No. I6-057-01
Exhibit 1,1
(g) Contractsl l-arvs, Any Contract or Law defined or referred to herein
lneans such Contract or Law as fi'om tirne to time amended, rnodified or supplemcnted, unless
otherwise specifi cally indicated,
(h) Persons. References to a Persou are also to its successors and pennitted
assigns.
(i) Exhibits and Disclosure Schedules. The Exhibits to this Agreement and
tlie Company Disclosure Schedule are hereby incorporated and made a part hereof. The
Company may inch:de in the Company Disclosure Schedule items that are not material in order
to avoid any misundelstanding, and such inclusion, or any references to dollar amounts herein or
in the Compariy Disclosule Schedule, shall not be deemed to be an acknowledgement or
representation that such items are rnaterial, to establish any standard of materiality or to define
further the meaning of such tenns for purposes of this Agteement or otherwise. Any capitalized
temr used in auy Exhibit or arly Cornpany Disclosure Schedule but not otherwise defined therein
shall have the rneaning given to such tenn herein.
0) y_[Ug_elyglntlh, To the extent that this Agreement or atly provision
hereof requires the Company to cause any of its Subsidiaries to talce or refi'ailr fi'om taking any
action, the Cornpany shall exercise any voting rights pursuant to the White River LLC
Agreement (to the extent permitted by the terms tirereof) in fuftherance of causing .White River
Hub to take ol refrain from talcing any such action. For purposes of any replesentations and
warranties r:rade by the Company in r\rticle [Ii irereof with respect to a Subsidiary such
replesentations and warranties shall be in all cases deerned to be made solely to the Knowledge
of the Cornpany with respect to Wlrite River Hub.
(k) Clorrstructiorr. Each of the parties hereto have participated joirrtly in tlie
negotiation and drafting of this Agreement and, in the event an ambiguity or question of intent or
interpretation arises, this Agreement shall be construed as joirrtly drafted by the parties hereto
and no presurrrption or burden of proof shall arise favoring or disfavorirlg any party by virtue of
the authorship of any plovision of this Agreement.
[S i gn.a tur e p age .fo llou,sJ
t(E 39423794
66
Joint Application
DocketNo. i6-057-01
Exhibit 1.1
IN WITMSS WHEREOF, the parties hereto have caused this Agreement to be du)y
expcuted arrd delivered as of the date fust above written.
QTJESTAR CORPO&ATTON
d[{.
dent
lslgnaln,'e Pdge lo A,latget lg\cuanfi
Joint Application
DocketNo. 16-057-01
Exhibit 1.1
Name: David A. Cluistiarr
Title: President
DIAMOND B
By: L
: Thomas F.
Officer
lSlgnaluta Pagc to l,lerger Agreetn*tl