Black Hills (BKH)

Dividend Restrictions

Our revolving credit facility and Acquisition Facility contain restrictions on the payment of cash dividends upon a default or event of default. An event of default would be deemed to have occurred if we did not meet certain financial covenants. The most restrictive financial covenants include the following: interest expense coverage ratio of not less than 2.5 to 1.0; a recourse leverage ratio not to exceed 0.70 to 1.00 (or 0.65 to 1.00 after the first year of the Aquila acquisition); and a minimum consolidated net worth of $625 million plus 50% of aggregate consolidated net income since January 1, 2005. As of December 31, 2008, we were in compliance with the above covenants.

Dividend Restrictions

Our revolving credit facility and Acquisition Facility contain restrictions on the payment of cash dividends upon a default or event of default. An event of default would be deemed to have occurred if we did not meet certain financial covenants. The most restrictive financial covenants include the following: interest expense coverage ratio of not less than 2.5 to 1.0; a recourse leverage ratio not to exceed 0.70 to 1.00 (or 0.65 to 1.00 after the first year of the Aquila acquisition); and a minimum consolidated net worth of $625 million plus 50% of aggregate consolidated net income since January 1, 2005. As of December 31, 2008, we were in compliance with the above covenants.

Dividend Restrictions

The Company’s credit facility contains restrictions on the payment of cash dividends under a circumstance of default or event of default. An event of default would be deemed to have occurred if the Company did not meet the financial covenant requirements for the facility. The most restrictive financial covenants include the following: interest expense coverage ratio of not less than 2.5 to 1.0; a recourse leverage ratio not to exceed 0.65 to 1.00 (or 0.70 to 1.00 for the first year after the Aquila acquisition); and a minimum consolidated net worth of $625 million plus 50 percent of aggregate consolidated net income since January 1, 2005. As of December 31, 2007, the Company was in compliance with the above covenants.

Dividend Restrictions

The Company’s credit facility contains restrictions on the payment of cash dividends under a circumstance of default or event of default. An event of default would be deemed to have occurred if the Company did not meet the financial covenant requirements for the facility. The most restrictive financial covenants include the following: interest expense coverage ratio of not less than 2.5 to 1.0; a recourse leverage ratio not to exceed 0.65 to 1.00 (or 0.70 to 1.00 for the first year after the Aquila acquisition); and a minimum consolidated net worth of $625 million plus 50 percent of aggregate consolidated net income since January 1, 2005. As of December 31, 2007, the Company was in compliance with the above covenants.

Dividend Restrictions

The Company’s credit facility contains restrictions on the payment of cash dividends under a circumstance of default or event default. An event of default would be deemed to have occurred if the Company did not meet the financial covenant requirements for the facility. The most restrictive financial covenants include the following: interest expense coverage ratio of not less than 2.5 to 1.0; a recourse leverage ratio not to exceed 0.65 to 1.00; and a minimum consolidated net worth of $625 million plus 50 percent of aggregate consolidated net income since January 1, 2005. As of December 31, 2006, the Company was in compliance with the above covenants.

Dividend Restrictions

The Company’s credit facility contains restrictions on the payment of cash dividends under a circumstance of default or event default. An event of default would be deemed to have occurred if the Company did not meet the financial covenant requirements for the facility. The most restrictive financial covenants include the following: fixed charge coverage ratio of not less than 2.5 to 1.0; a recourse leverage ratio not to exceed 0.65 to 1.00; and a minimum consolidated net worth of $625 million plus 50 percent of our aggregate consolidated net income since January 1, 2005. As of December 31, 2005, we were in compliance with the above covenants.

Dividend Restrictions

Some of the Company’s credit facilities contain restrictions on the payment of cash dividends under a circumstance of default or event default. An event of default would be deemed to have occurred if the Company did not meet the financial covenant requirements for the respective facility. The most restrictive financial covenants include the following: fixed charge coverage ratio of not less than 1.5 to 1.0; a recourse leverage ratio not to exceed 0.65 to 1.00; and a minimum consolidated net worth of $550 million plus 50 percent of our aggregate consolidated net income since April 1, 2004. As of December 31, 2004, we were in compliance with the above covenants. In addition, under PUHCA, unless there is an order from the SEC, a holding company or any subsidiary may only declare and pay dividends out of retained earnings. As part of the order approving our public utility holding company, we agreed that the consolidated company and the utility subsidiaries will maintain at least a 30 percent common equity ratio. Through December 31, 2007, our non-utility subsidiaries are also allowed to pay dividends out of capital and unearned surplus if (i) they have received excess cash as a result of the sale of assets, (ii) they have engaged in a restructuring or reorganization and/or (iii) they are returning capital to an associate company.

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