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EXHIBIT 1
CMS ENERGY CORPORATION
Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP
$400,000,000
GENERAL TERM NOTES(R), SERIES E
DUE FROM NINE MONTHS TO TWENTY-FIVE YEARS FROM DATE OF ISSUE
DISTRIBUTION AGREEMENT
August ___, 1998
▇. ▇. ▇▇▇▇▇ & COMPANY
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Dear Sirs:
CMS Energy Corporation, a Michigan corporation (the "Company"),
confirms its agreement with you (the "Agent," and together with such additional
agents as may be named from time to time, the "Agents") with respect to the
issue and sale by the Company of up to $400,000,000 aggregate principal amount
of its General Term Notes(R), Series E (the "Notes"). The Notes are to be issued
under an Indenture, dated as of January 15, 1994 as supplemented by a First
Supplemental Indenture dated as of January 20, 1994, a Second Supplemental
Indenture dated as of March 19, 1996, a Third Supplemental Indenture dated as of
March 17, 1997 a Fourth Supplemental Indenture dated as of September 17, 1997
and a Fifth Supplemental Indenture dated as of August __, 1998 (such Indenture,
as so supplemented, the "Indenture"), between the Company and The Chase
Manhattan Bank, as trustee (the "Trustee"). The Notes will have the maturities,
annual interest rates, redemption provisions, if any, and other terms specified
in a pricing supplement to the Prospectus referred to below.
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(R) Registered servicemark of ▇. ▇. ▇▇▇▇▇ & Company
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Subject to the terms and conditions stated herein, the Company hereby
(i) appoints ▇. ▇. ▇▇▇▇▇ & Company as the agent of the Company for the purpose
of soliciting and receiving offers to purchase the Notes, (ii) reserves the
right, from time to time, to appoint additional agents for the purpose of
soliciting and receiving offers to purchase the Notes, provided that (a) the
Company shall furnish the Agents with reasonable advance notification of the
addition of any such agent, (b) such additional agent shall be acceptable to ▇.
▇. ▇▇▇▇▇ & Company and (c) each such additional agent shall be required to
become a party to this agreement and undertake the obligations of an Agent
hereunder pursuant to an Additional Agent Appointment Agreement substantially in
the form of Exhibit E hereto, and (iii) agrees that, whenever the Company
determines to sell Notes pursuant to this Agreement, such Notes shall be sold
pursuant to a supplemental agreement between the Company and ▇. ▇. ▇▇▇▇▇ &
Company (the "Purchasing Agent") with the Purchasing Agent purchasing such Notes
as principal; the supplemental agreement will also specify the amount of Notes
being sold which have been solicited by each Agent. Each such supplemental
agreement (which shall be either oral, to be confirmed in writing, or written,
and in either case the written confirmation of an oral agreement or the written
supplemental agreement shall be substantially in the form of Exhibit B hereto
and may take the form of an exchange of any standard form of written
telecommunication between the Purchasing Agent and the Company) is herein
referred to as a "Terms Agreement." Any such Terms Agreement may be signed on
behalf of the Company by such persons as are authorized from time to time by the
Board of Directors of the Company to bind the Company in this regard. Under no
circumstances will any Agent be obligated to purchase, or the Company be
obligated to sell, any Notes, unless a Terms Agreement has been entered into
between the Company and the Purchasing Agent with respect to such Notes.
1. Solicitations by the Agents of Offers To Purchase; Purchases
by the Purchasing Agent of Notes as Principal.
Following the Commencement Date (defined below), the Company shall
notify the Agents from time to time as to the commencement of a period during
which the Notes may be offered and sold by the Agents. On the basis of the
representations and warranties herein contained, but subject to the terms and
conditions herein set forth, the Agents will use their respective reasonable
best efforts to solicit offers to purchase the Notes upon the terms and
conditions set forth in the Prospectus as then amended and supplemented and as
contemplated by the Note Administrative Procedures attached hereto as Exhibit A
("the Procedures").
The Agents are authorized to solicit orders for the Notes only in
denominations of $1,000 or any amount in excess thereof which is a multiple of
$1,000 and, unless otherwise agreed to by the Company, at a purchase price equal
to 100% of their principal amount. In soliciting offers to purchase the Notes
hereunder, the Agents are acting solely as agents for the Company, and not as
principals. Each Agent shall communicate to the Company, orally or in writing,
each reasonable offer or indication of interest received by it to purchase
Notes. Each Agent shall have the right to reject, in its discretion reasonably
exercised, any offer received by it to purchase the
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Notes, in whole or in part, and any such rejection shall not be deemed a breach
of its agreements contained herein. The Company shall have the right to accept
offers to purchase the Notes and may reject any such offer in whole or in part.
The obligations of the Agents under this Agreement shall be several and not
joint.
Each acceptance by the Company of an offer to purchase Notes shall be
in accordance with the terms of this Agreement and a Terms Agreement which will
provide for the sale of such Notes to, and the purchase and reoffering thereof
by, the Purchasing Agent as principal. The commitment of the Purchasing Agent to
purchase Notes pursuant to any Terms Agreement (and any contemporaneous purchase
of Notes by an Agent from the Purchasing Agent) shall be deemed to have been
made on the basis of the representations and warranties of the Company herein
contained and shall be subject to the terms and conditions herein set forth.
Each Terms Agreement shall describe the Notes to be purchased pursuant thereto
by the Purchasing Agent as principal, specify the principal amount of such
Notes, the price to be paid to the Company for such Notes, the rate at which
interest will be paid on the Notes, the date and time of delivery of payment for
such Notes (the "Settlement Date"), whether the Notes provide for a survivor's
option or for optional redemption by the Company and on what terms and
conditions, the place of delivery of the Notes and payment therefor, the method
of payment and any requirements for the delivery of the opinions of counsel, the
certificates from the Company, and the letter from ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP, pursuant
to Section 6(B)(b). The Agents may reallow any portion of the commission payable
pursuant hereto to dealers or purchasers in connection with the offer and sale
of any Notes.
The Company agrees to pay to the Purchasing Agent, as consideration for
soliciting the sale of the Notes pursuant to a Terms Agreement, a commission in
the form of a discount equal to a percentage not greater than 4%, which
percentage shall be set forth in the applicable Terms Agreement, of the
principal amount of each Note sold by the Company; the Purchasing Agent and the
other Agents will share such commission in such proportion as they may agree.
Delivery of the certificates for Notes pursuant to any Terms Agreement
shall be made as agreed to between the Company and the Purchasing Agent as
specified in the Terms Agreement, not later than the Settlement Date set forth
in such Terms Agreement, against payment of funds to the Company in the net
amount due to the Company for such Notes by the method and in the form specified
in the Terms Agreement.
The Agents and the Company agree to perform the respective duties and
obligations specifically provided to be performed by them in the Procedures. The
Procedures may be amended only by written agreement of the Company and the
Agents.
The documents required to be delivered by Section 6 of this Agreement
shall be delivered at the office of Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP,
counsel for the Agents, ▇▇▇ ▇▇▇▇▇
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▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇, on such date as may be agreed to by the Company and
the Agents (the "Commencement Date").
2. Other Activities of Agents. The Company acknowledges that nothing in
this Agreement shall prohibit any Agent from (i) acting as broker for the sale
of Notes by customers other than the Company, (ii) soliciting the sale of Notes
through such Agent as broker for a seller, soliciting the sale of Notes to such
Agent as principal and soliciting offers to buy Notes, (iii) purchasing Notes in
the secondary market, and (iv) offering and selling as principal for its own
account Notes which such Agent has purchased.
3. Representations and Warranties. The Company represents and warrants
to, and agrees with, the Agents as of the date hereof, as of the Commencement
Date and as of the times referred to in Section 4(g) hereof (the Commencement
Date and each such time hereinafter sometimes referred to as a "Representation
Date"), that:
(a) A registration statement (File No. _________) in respect
of $400,000,000 aggregate principal amount of debt securities of the
Company, including the Notes, has been filed with the Securities and
Exchange Commission (the "Commission"); such registration statement and
any post-effective amendment thereto, each in the form heretofore
delivered or to be delivered to the Agents, including all documents
incorporated by reference in the prospectus contained therein, have
been declared effective by the Commission in such form, and no other
document with respect to such registration statement or other document
incorporated by reference therein has heretofore been filed or
transmitted for filing with the Commission; and no stop order
suspending the effectiveness of such registration statement has been
issued and no proceeding for that purpose has been initiated or, to the
Company's knowledge, threatened by the Commission (any preliminary
prospectus included in such registration statement or filed with the
Commission pursuant to Rule 424(a) of the rules and regulations of the
Commission under the Securities Act of 1933, as amended (the "Act"),
being hereinafter called a "Preliminary Prospectus"); such registration
statement, as amended at the time it became effective, including all
exhibits thereto and the documents incorporated by reference therein at
the time such registration statement became effective, being
hereinafter called the "Registration Statement"; the prospectus,
including any prospectus supplement relating to the Notes, in the form
in which it has most recently been filed, or transmitted for filing,
with the Commission on or prior to the date of this Agreement, being
hereinafter called the "Prospectus"; any reference herein to any
Preliminary Prospectus or the Prospectus shall be deemed to refer to
and include the documents incorporated by reference therein pursuant to
the applicable form under the Act, as of the date of such Preliminary
Prospectus or Prospectus, as the case may be; any reference to any
amendment or supplement to any Preliminary Prospectus or the
Prospectus, including any supplement to the Prospectus that sets forth
only the terms of a particular issue of the Notes and the manner of
distribution thereof (a "Pricing Supplement"), shall be deemed to refer
to and
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include any documents filed after the date of such Preliminary
Prospectus or Prospectus, as the case may be, under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and incorporated
by reference in such Preliminary Prospectus or Prospectus, as the case
may be; any reference to any amendment to the Registration Statement
shall be deemed to refer to and include any annual report of the
Company filed pursuant to Section 13(a) or 15(d) of the Exchange Act
after the effective date of the Registration Statement that is
incorporated by reference in the Registration Statement; and any
reference to the Prospectus as amended or supplemented shall be deemed
to refer to and include the Prospectus as amended or supplemented
(including the applicable Pricing Supplement) in relation to the Notes
sold pursuant to this Agreement, in the form in which it is filed, or
transmitted for filing, with the Commission pursuant to Rule 424(b)
under the Act in accordance with Section 4(a)(ii) hereof, including any
documents incorporated by reference therein as of the date of such
filing or transmission);
(b) The documents incorporated by reference in the Prospectus,
when they were filed with the Commission (or, if an amendment with
respect to any such document was filed, when such amendment was filed),
conformed in all material respects to the requirements of the Act or
the Exchange Act, as applicable, and the rules and regulations of the
Commission thereunder, and none of such documents, when they were
filed, contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which
they were made, not misleading; and any further documents so filed and
incorporated by reference in the Prospectus or any further amendment or
supplement thereto, when such documents are filed with the Commission,
will conform in all material respects to the requirements of the Act or
the Exchange Act, as applicable, and the rules and regulations of the
Commission thereunder and will not contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading; provided,
however, that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity with
information furnished in writing to the Company by an Agent expressly
for use in the Prospectus as amended or supplemented;
(c) The Registration Statement and the Prospectus conform, and
any amendments or supplements to the Registration Statement or the
Prospectus will conform, in all material respects to the requirements
of the Act and the Trust Indenture Act of 1939, as amended (the "Trust
Indenture Act"), and the rules and regulations of the Commission
thereunder, and the Registration Statement, as of its effective date,
and the Prospectus, as of its filing date, do not, and any amendments
or supplements to the Registration Statement or the Prospectus will
not, contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances in which they were
made, not misleading; provided, however,
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that this representation and warranty shall not apply to any statements
or omissions made in reliance upon and in conformity with information
furnished in writing to the Company by an Agent expressly for use in
the Registration Statement or the Prospectus as amended or supplemented
or any such statements in or omissions from that part of the
Registration Statement that constitutes the Statement of Eligibility on
Form T-1 of the Trustee under the Trust Indenture Act;
(d) Since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus there has not
been any material adverse change in the business, properties, financial
condition or results of operations of the Company and its consolidated
subsidiaries, taken as a whole, otherwise than as set forth or
contemplated in the Prospectus, as amended or supplemented;
(e) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Michigan, with corporate power and corporate authority to own or
lease its properties and conduct its business as described in the
Prospectus, and has been duly qualified as a foreign corporation for
the transaction of business and is in good standing under the laws of
each other jurisdiction in which it owns or leases properties, or
conducts any business, in which the failure to so qualify and be in
good standing would materially and adversely affect the business,
financial condition or results of operations of the Company and its
consolidated subsidiaries, taken as a whole;
(f) The filing of the Registration Statement with respect to
the Notes has, and the issuance and sale of the Notes pursuant to this
Agreement and any Terms Agreement have, been duly authorized by the
Company, and, when Notes are authenticated and issued pursuant to the
Indenture and delivered against payment of the consideration as
specified in this Agreement and any applicable Terms Agreement, such
Notes will have been duly executed, issued and delivered by the Company
and will constitute valid and legally binding obligations of the
Company, enforceable in accordance with their terms, subject, as to
enforcement, to bankruptcy, insolvency, reorganization and other laws
of general applicability relating to or affecting creditors' rights and
to general equity principles and will be entitled to the benefits
provided by the Indenture; the Indenture has been duly authorized,
executed and delivered by the Company and is duly qualified under the
Trust Indenture Act and the Indenture constitutes a valid and legally
binding instrument, enforceable in accordance with its terms, subject,
as to enforcement, to bankruptcy, insolvency, reorganization and other
laws of general applicability relating to or affecting creditors'
rights and to general equity principles; and the Indenture conforms,
and the Notes will conform, in all material respects, to the
descriptions thereof contained in the Prospectus as amended or
supplemented to relate to each issuance of Notes;
(g) The issue and sale of the Notes and the compliance by the
Company with all of the provisions of the Notes, the Indenture, this
Agreement and any Terms
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Agreement, and the consummation of the transactions herein and therein
contemplated will not conflict with or result in a breach of any of the
terms or provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement or other agreement or
instrument to which the Company or any of its significant subsidiaries
(as defined in Rule 405 as promulgated by the Commission under the Act)
is a party or by which the Company or any of its significant
subsidiaries is bound, or to which any of the property or assets of the
Company or any of its significant subsidiaries is subject, that is
material to the business, properties, financial condition or results of
operations of the Company and its consolidated subsidiaries, taken as a
whole, nor will such action result in any violation of the provisions
of the Articles of Incorporation, as amended, or the By-laws of the
Company or any statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the Company or any
of its significant subsidiaries or any of their properties; and no
consent, approval, authorization, order, registration or qualification
of or with any such court or governmental agency or body is required
for the issue and sale of the Notes or the consummation by the Company
of the other transactions contemplated by this Agreement or any Terms
Agreement or the Indenture, except such as have been, or will have been
prior to the Commencement Date, obtained under the Act and the Trust
Indenture Act and such consents, approvals, authorizations,
registrations or qualifications as may be required under state
securities or blue sky laws in connection with the solicitation by any
Agent of offers to purchase Notes and with purchases of Notes by such
Agent as principal;
(h) Other than as set forth or contemplated in the Prospectus,
as amended or supplemented, there are no legal or governmental
proceedings pending to which the Company or any of its significant
subsidiaries is a party or of which any property of the Company or any
of its significant subsidiaries is the subject with respect to which
there is a reasonable likelihood of one or more determinations which
would individually or in the aggregate have a material adverse effect
on the business, properties, financial condition or results of
operations of the Company and its consolidated subsidiaries, taken as a
whole; and, to the best of the Company's knowledge, no such proceedings
are threatened by governmental authorities or others;
(i) The Company is not subject to regulation under the
Investment Company Act of 1940, as amended;
(j) The Company will apply the net proceeds from the sale of
Notes for the purpose set forth in the Prospectus under the caption
"Use of Proceeds";
(k) To the best of the Company's knowledge, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
LLP, who have audited certain financial statements of the Company
incorporated by reference in the Registration Statement and the
Prospectus, are independent public accountants as required by the Act
and the rules and regulations of the Commission thereunder;
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(l) Immediately after the sale of Notes by the Company
hereunder and under any Terms Agreement, the aggregate amount of Notes
which shall have been issued and sold by the Company hereunder and
under any Terms Agreement and of any debt securities of the Company
(other than such Notes) that shall have been issued and sold pursuant
to the Registration Statement will not exceed the amount of debt
securities registered under the Registration Statement;
(m) Other than as set forth or contemplated in the Prospectus,
as amended or supplemented, the Company owns or possesses all permits,
licenses and other authorizations necessary to own, lease or use its
properties and assets and to conduct its business in the manner
described in the Prospectus, except to the extent that the failure to
own or possess any such permit, license or other authorization would
not have a material adverse effect on the business, properties,
financial condition or results of operations of the Company and its
consolidated subsidiaries, taken as a whole, and the Company has not
received any notice of proceedings relating to the revocation or
modification of any such permit, license or other authorization which,
singly or in the aggregate, if the subject of an unfavorable decision,
ruling or finding, might reasonably be expected to have a material
adverse effect upon the business, properties, financial condition or
results of operations of the Company and its consolidated subsidiaries,
taken as a whole; and
(n) Other than as set forth in the Prospectus as amended or
supplemented, no event or condition exists that constitutes, or with
the giving of notice or lapse of time or both would constitute, a
default under any bond, debenture, note or other evidence of
indebtedness for money borrowed by the Company or any of its
significant subsidiaries or under any indenture, mortgage, loan
agreement or instrument under which there may be issued or by which
there may be secured or evidenced any indebtedness for money borrowed
by the Company or any of its significant subsidiaries, if such default
would result in such indebtedness in an aggregate principal amount
exceeding $25,000,000 becoming or being declared due and payable prior
to the date on which it would otherwise become due and payable.
4. Covenants of the Company. The Company agrees with each of the
Agents:
(a) (i) To make no amendment or supplement to the Registration
Statement or the Prospectus after the date of any Terms Agreement by
the Purchasing Agent to purchase Notes as principal and prior to the
related Settlement Date prior to having afforded each Agent a
reasonable opportunity to review and comment on it and having
reasonably considered any such comments; provided however, that, if any
amendment or supplement to the Registration Statement or the Prospectus
shall be transmitted for filing or filed after the date of any Terms
Agreement between the Company and the Purchasing Agent for the purchase
of Notes and prior to the related Settlement Date, the Purchasing Agent
may unilaterally terminate such Terms Agreement and upon any such
termination no Agent shall have any further obligation under such Terms
Agreement; (ii) to prepare, with
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respect to any Notes to be sold through or to such Agent pursuant to
this Agreement, a Pricing Supplement with respect to such Notes in a
form previously approved by such Agent and to file such Pricing
Supplement pursuant to Rule 424(b) under the Act within the applicable
time period prescribed for such filing by such Rule; (iii) to make no
amendment or supplement to the Registration Statement or Prospectus,
other than any Pricing Supplement, at any time prior to having afforded
each Agent a reasonable opportunity to review and promptly comment on
it and having reasonably considered any such comments; (iv) to file
timely all reports and any definitive proxy or information statements
required to be filed by the Company with the Commission pursuant to
Section 13(a), 13(c), 14 or 15(d) of the Exchange Act (all such reports
and proxy or information statements which are so filed and which have
not been subsequently superseded shall be referred to as the
"Incorporated Documents") for so long as the delivery of a prospectus
is required in connection with the offering or sale of the Notes, and
during such period to advise such Agent, promptly after the Company
receives notice thereof, of the time when any amendment to the
Registration Statement has been filed or has become effective or any
amendment or supplement to the Prospectus (other than any Pricing
Supplement that relates to Notes not purchased through or by such
Agent) has been filed with the Commission, of the issuance by the
Commission of any stop order or of any order preventing or suspending
the use of any prospectus relating to the Notes, of the suspension of
the qualification of the Notes for offering or sale in any
jurisdiction, of the initiation or threatening of any proceeding for
any such purpose, or of any request by the Commission for the amendment
or supplement of the Registration Statement or Prospectus or for
additional information; and (v) in the event of the issuance of any
such stop order or of any such order preventing or suspending the use
of any such prospectus or suspending any such qualification, promptly
to use reasonable efforts to obtain its withdrawal;
(b) Promptly from time to time to take such action as the
Agents may reasonably request to qualify such Notes for offering and
sale under the securities laws of such jurisdictions in the United
States as the Agents may reasonably request and to comply with such
laws so as to permit the continuance of sales and dealings therein in
such jurisdictions for as long as may be necessary to complete the
distribution of such Notes, provided that in connection therewith the
Company shall not be required to qualify as a foreign corporation, to
file a general consent to service of process in any jurisdiction, take
any action which would subject it to general service of process in any
jurisdiction where it is not now subject or file annual reports with
such jurisdictions or comply with any other requirements deemed by the
Company in its reasonable judgment expressed in writing to the
Purchasing Agent to be unduly burdensome; and to inform the Agents
promptly of any notices it may receive from any state securities agency
which limits or will limit any such qualification or exemption;
(c) To furnish the Agents with copies of the Prospectus as
amended or supplemented, in the form in which it is filed with the
Commission pursuant to Rule
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424(b) of the Act, in such quantities as the Agents may from time to
time reasonably request, and, if the delivery of a prospectus is
required at any time in connection with the offering or sale of any
Notes and if at such time any event shall have occurred as a result of
which it is necessary to further amend or supplement the Prospectus in
order that the Prospectus will not include an untrue statement of a
material fact or omit to state any material fact necessary in order to
make the statements therein, in the light of the circumstances under
which they were made, not misleading, or, if for any other reason
during such period it is necessary to further amend or supplement the
Prospectus or to file under the Exchange Act any document incorporated
by reference in the Prospectus in order to comply with the Act, the
Exchange Act or the Trust Indenture Act, to notify each Agent and
request the Agents, in their capacity as agents of the Company, to
suspend solicitation of offers to purchase Notes from the Company (and,
if so notified, each Agent shall cease such solicitations as soon as
possible, but in any event not later than one business day later); and
if the Company shall decide to amend or supplement the Registration
Statement or the Prospectus as then amended or supplemented, to so
advise the Agents by telephone (with confirmation in writing) and to
prepare and cause to be filed as soon as practicable with the
Commission an amendment or supplement to the Registration Statement or
the Prospectus as then amended or supplemented that will correct such
statement or omission or effect such compliance; provided, however,
that if during such period an Agent continues to own Notes purchased
from the Company by such Agent as principal or an Agent is otherwise
required to deliver a prospectus in respect of transactions in the
Notes, the Company shall promptly prepare and file with the Commission
such an amendment or supplement;
(d) To make generally available to its security holders as
soon as practicable, but in any event not later than eighteen months
after the effective date of the Registration Statement (as defined in
Rule 158(c) of the Act), an earnings statement of the Company and its
consolidated subsidiaries (which need not be audited) covering a period
of at least 12 months beginning after the later of (i) the effective
date of the Registration Statement, (ii) the effective date of each
post-effective amendment to the Registration Statement, and (iii) the
date of each filing by the Company with the Commission of an Annual
Report on Form 10-K that is incorporated by reference in the
Registration Statement, which earning statements shall comply with
Section 11(a) of the Act and the rules and regulations of the
Commission thereunder (including, at the option of the Company, Rule
158 of the Act);
(e) So long as any Notes are outstanding, to furnish to such
Agent, without charge, copies of its Annual Report on Form 10-K and
other financial reports of the Company furnished or made available to
the public generally, and deliver to such Agent, (i) as soon as they
are available, copies of any Incorporated Documents; and (ii) such
additional publicly available information concerning the business and
financial condition of the Company as such Agent may from time to time
reasonably request;
(f) That, from the date of any Terms Agreement with the
Purchasing Agent and continuing to and including the related Settlement
Date, the Company will not, without the
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prior written consent of each Agent, which consent shall not be
unreasonably withheld, issue or announce the proposed issuance of,
offer, sell, contract to sell or otherwise dispose of any debt
securities of the Company which both mature more than 9 months after
such Settlement Date and are substantially similar to the Notes and
which are expected to be distributed on a retail basis in a manner
comparable to that set forth in Exhibit A;
(g) That each execution and delivery by the Company of a Terms
Agreement with the Purchasing Agent shall be deemed to be an
affirmation to each Agent that the representations and warranties of
the Company contained in this Agreement are true and correct as of the
date of such Terms Agreement, as though made at and as of such date,
and an undertaking that such representations and warranties will be
true and correct as of the Settlement Date for the Notes relating to
such sale, as though made at and as of such date (except that such
representations and warranties shall be deemed to relate to the
Registration Statement and the Prospectus, as amended and supplemented,
relating to such Notes);
(h) That each time the Registration Statement or the
Prospectus shall be amended or supplemented (other than by a Pricing
Supplement), each time a document filed under the Act or the Exchange
Act is incorporated by reference into the Prospectus (other than (A) a
Current Report pursuant to Section 13 or 15(d) of the Exchange Act on
Form 8-K relating exclusively to the previous issuance of Notes under
the Registration Statement or (B) a Quarterly Report on Form 10-Q under
the Exchange Act, unless, in the case of clause (B), the Agents shall
otherwise request), and each time the Company sells Notes to the
Purchasing Agent as principal and the applicable Terms Agreement
specifies the delivery of an opinion or opinions by Skadden, Arps,
Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP, counsel to the Agent, as a condition to the
purchase of Notes pursuant to such Terms Agreement, at the request of
such Agent, Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP shall furnish to
such Agent its written opinion, dated the date of such amendment,
supplement, incorporation or Settlement Date relating to such sale, as
the case may be, in form reasonably satisfactory to such Agent to the
effect that such Agent may rely on the opinion of such counsel as to
the matters referred to in Section 6(A)(c), which was last furnished to
such Agent to the same extent as though it was dated the date of such
letter authorizing reliance (except that the statements in such last
opinion shall be deemed to relate to the Registration Statement and the
Prospectus as amended and supplemented to such date or, in lieu of such
opinion, an opinion of the same tenor as the opinion of such counsel as
to the matters referred to in Section 6(A)(c), but modified to relate
to the Registration Statement and the Prospectus as amended and
supplemented to such date), and reasonably in advance of the time that
any such opinion is to be delivered the Company shall furnish to such
counsel such papers and information as they may reasonably request to
enable them to pass on such matters;
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(i) That each time the Registration Statement or the
Prospectus shall be amended or supplemented (other than by a Pricing
Supplement), each time a document filed under the Act or the Exchange
Act is incorporated by reference into the Prospectus (other than (A) a
Current Report pursuant to Section 13 or 15(d) of the Exchange Act on
Form 8-K relating exclusively to the previous issuance of Notes under
the Registration Statement or (B) a Quarterly Report on Form 10-Q under
the Exchange Act, unless, in the case of clause (B), the Agents shall
otherwise request), and each time the Company sells Notes to the
Purchasing Agent as principal and the applicable Terms Agreement
specifies the delivery of an opinion under this Section 4(i) as a
condition to the purchase of Notes pursuant to such Terms Agreement,
the Company shall furnish or cause to be furnished forthwith to such
Agent the written opinion or opinions of counsel to the Company or such
other counsel for the Company reasonably satisfactory to such Agent,
dated the date of such amendment, supplement, incorporation or
Settlement Date relating to such sale, as the case may be, in form
reasonably satisfactory to such Agent to the effect that such Agent may
rely on the opinion of such counsel as to the matters referred to in
Exhibit C hereof, which was last furnished to such Agent to the same
extent as though it was dated the date of such letter authorizing
reliance (except that the statements in such last opinion shall be
deemed to relate to the Registration Statement and the Prospectus as
amended and supplemented to such date or, in lieu of such opinion, an
opinion of the same tenor as the opinion of such counsel as to the
matters referred to in Exhibit C hereof but modified to relate to the
Registration Statement and the Prospectus as amended and supplemented
to such date);
(j) That each time the Registration Statement or the
Prospectus shall be amended or supplemented (other than by a Pricing
Supplement) and each time that a document filed under the Act or the
Exchange Act is incorporated by reference into the Prospectus (other
than (A) a Current Report pursuant to Section 13 or 15(d) of the
Exchange Act on Form 8-K relating exclusively to the previous issuance
of Notes under the Registration Statement or (B) a Quarterly Report on
Form 10-Q under the Exchange Act, unless, in the case of clause (B),
the Agents shall otherwise request), in either case to set forth
financial information included in or derived from the Company's
consolidated financial statements or accounting records, and each time
the Company sells Notes to the Purchasing Agent as principal and the
applicable Terms Agreement specifies the delivery of a letter under
this Section 4(j) as a condition to the purchase of Notes pursuant to
such Terms Agreement, the Company shall cause ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP
forthwith to furnish such Agent a letter, dated the date of such
amendment, supplement, incorporation or Settlement Date relating to
such sale, as the case may be, in form reasonably satisfactory to such
Agent, of the same tenor as the letter referred to in Exhibit D hereof
but modified to relate to the Registration Statement and the Prospectus
as amended or supplemented to the date of such letter, with such
changes as may be necessary to reflect changes in the financial
statements and other information derived from the accounting records of
the Company, to the extent such financial statements and other
information are available as
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of a date not more than five business days prior to the date of such
letter; provided, however, that, with respect to any financial
information or other matter, such letter may reconfirm as true and
correct at such date as though made at and as of such date, rather than
repeat, statements with respect to such financial information or other
matter made in the letter referred to in Exhibit D hereof which was
last furnished to such Agent; and
(k) That each time the Registration Statement or the
Prospectus shall be amended or supplemented (other than by a Pricing
Supplement), each time a document filed under the Act or the Exchange
Act is incorporated by reference into the Prospectus (other than a
Current Report pursuant to Section 13 or 15(d) of the Exchange Act on
Form 8-K relating exclusively to the previous issuance of Notes under
the Registration Statement), and each time the Company sells Notes to
the Purchasing Agent as principal and the applicable Terms Agreement
specifies the delivery of a certificate under this Section 4(k) as a
condition to the purchase of Notes pursuant to such Terms Agreement,
the Company shall furnish or cause to be furnished forthwith to such
Agent a certificate, dated the date of such supplement, amendment,
incorporation or Settlement Date, as the case may be, in such form and
executed by such officers of the Company as shall be reasonably
satisfactory to such Agent (or, in the case of certificates delivered
pursuant to Section 6(B)(b) hereof, by such other employees authorized
by the Board of Directors of the Company to execute and deliver such
certificates), to the effect that the statements contained in the
certificate referred to in Section 6 hereof which was last furnished to
such Agent are true and correct at such date as though made at and as
of such date (except that such statements shall be deemed to relate to
the Registration Statement and the Prospectus as amended and
supplemented to such date) or, in lieu of such certificate,
certificates of the same tenor as the certificates referred to in said
Section 6 but modified to relate to the Registration Statement and the
Prospectus as amended and supplemented to such date.
5. Payment of Expenses. The Company covenants and agrees with
each Agent that the Company will pay or reimburse all expenses incident to this
Agreement, including the following: (i) the reasonable fees and expenses of one
counsel for the Agents in connection with the preparation of a blue sky survey
of qualifications and exemptions to offer and sell notes in the various states
in the United States, the District of Colombia, Puerto Rico and Guam, provided
that the Company shall not be obligated to reimburse the Agents for any legal
fees referred to in this clause (i) in excess of $6,500; (ii) to the extent the
Company has agreed to print any of the following, the cost of printing any Terms
Agreement, any Indenture, any blue sky survey and any other documents in
connection with the offering, purchase, sale and delivery of the Notes; (iii)
any filing fees in connection with the qualification of the Notes for offering
and sale under state securities laws as provided in Section 4(b) hereof; (iv)
any fees charged by securities rating services for rating the Notes; (v) any
filing fees incident to any required review by the National Association of
Securities Dealers, Inc. ("NASD") of the terms of the sale of the Notes; (vi)
the cost of preparing the Notes; (vii) the fees and expenses of any Trustee and
any agent of any Trustee and any transfer or paying agent of the Company and the
fees and disbursements of
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counsel for any Trustee or such agent in connection with any Indenture and the
Notes; and (viii) taxes (other than transfer taxes on sales by the Agents or
Dealers) in connection with the issuance and delivery of the Notes; provided
that the Company shall not be obligated to reimburse any Agent for any expenses
referred to in this sentence incurred after the initial offering of Notes except
as may be negotiated from time to time by the Company and the Agents. Except as
provided in this Section, Section 7 and Section 8 hereof, each Agent shall pay
all other costs and expenses it incurs.
6. Conditions to the Obligations of the Agents. (A) The
obligations of each Agent to solicit offers to purchase the Notes pursuant to
Section 1 hereof will, unless waived by such Agent expressly in writing, be
subject to the accuracy of the representations and warranties on the part of
the Company made herein as of the date hereof and as of the Commencement Date,
to the accuracy of the statements of the Company's officers made in each
certificate furnished pursuant to the provisions hereof, to the performance and
observance by the Company of all covenants and agreements herein contained on
its part to be performed and observed and to the following additional
conditions precedent:
(a) (i) The Prospectus as amended or supplemented (including
the Pricing Supplement) with respect to such Notes shall have been
filed with the Commission pursuant to Rule 424(b) under the Act within
the applicable time period prescribed for such filing by the rules and
regulations under the Act and in accordance with Section 4(a) hereof;
(ii) no stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceeding for that purpose
shall have been initiated or threatened by the Commission; and (iii)
all requests for additional information on the part of the Commission
shall have been complied with.
(b) The Company shall have furnished to such Agent an opinion
or opinions of the counsel to the Company, dated the Commencement Date,
substantially to the effect set forth in Exhibit C hereto. Any of the
opinions set forth therein may be delivered by another counsel for the
Company who is reasonably satisfactory to the Agents.
(c) Such Agent shall have received from Skadden, Arps, Slate,
▇▇▇▇▇▇▇ & ▇▇▇▇ LLP, counsel for the Agent, an opinion, dated the
Commencement Date, with respect to the Registration Statement, as
amended as of the Commencement Date, the Prospectus, as amended and
supplemented as of the Commencement Date, and other related matters as
such Agent may reasonably require; and the Company shall have furnished
to such counsel such documents as they may reasonably request for the
purpose of enabling them to pass on such matters.
(d) The Company shall have furnished to such Agent a
certificate of the Company, signed by any of the Chairman of the Board,
the President or the Chief Financial Officer, dated the Commencement
Date, to the effect that to the best of such person's knowledge after
reasonable investigation:
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(i) this Agreement is substantially in the form
presented to and approved by the Board of Directors of the
Company;
(ii) The representations and warranties of the
Company in this Agreement are true and correct in all material
respects on and as of the date of such certificate with the
same effect as if made on the date of such certificate, and
the Company has complied with all the agreements and satisfied
all the conditions on its part to be performed or satisfied as
a condition to the obligations of such Agent under this
Agreement;
(iii) since the date of the most recent financial
statements included or incorporated by reference in the
Prospectus, as amended and supplemented, there has been no
material adverse change in the business, properties, financial
condition or results of operations of the Company and its
consolidated subsidiaries, taken as a whole, other than those
changes reflected in or contemplated by the Prospectus, as
amended and supplemented as of the date of the certificate;
(iv) no stop order suspending the effectiveness of
the Registration Statement is in effect, and no proceedings
for such purposes are pending before or threatened by the
Commission; and
(v) since the date of the Prospectus, as amended and
supplemented, no downgrading shall have occurred in the rating
accorded the Company's debt securities by Standard & Poor's
Corporation ("S&P"), ▇▇▇▇▇'▇ Investors Service, Inc.
("Moody's"), ▇▇▇▇ & ▇▇▇▇▇▇ Credit Rating Co. ("Duff & ▇▇▇▇▇▇")
or Fitch Investors Service, L.P. ("Fitch") and none of S&P,
Moody's, ▇▇▇▇ & ▇▇▇▇▇▇ or Fitch has placed on "credit watch"
or "credit review" with negative implications the Company's
debt securities.
(e) ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP shall have furnished to such Agent a
letter or letters, dated the Commencement Date, in form and substance
satisfactory to such Agent, confirming that they are independent public
accountants within the meaning of the Act and the Exchange Act and the
respective applicable published rules and regulations thereunder.
(f) Subsequent to the respective dates as of which information
is given in the Registration Statement and the Prospectus, as amended
and supplemented, there shall not have been (i) any downgrade or
placement on "credit watch" or "credit review" as described in the
certificate referred to in paragraph (A)(d)(v) of this Section 6 or
(ii) any material adverse change in the business, properties, financial
condition or results of operations of the Company and its consolidated
subsidiaries, taken as a whole, the effect of which, in the reasonable
judgment of such Agent after reasonable inquiry, is to impair the
marketability of the Notes.
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(g) There shall not have occurred: (i)(A) a suspension or
material limitation in trading in securities generally on the New York
Stock Exchange, (B) a suspension in trading in any securities of the
Company on any exchange or over-the-counter market, or (C) a general
moratorium on commercial banking activities in New York declared by
either Federal or New York State authorities, if the effect of any such
occurrence is such as to impair, in the reasonable judgment of such
Agent, after reasonable inquiry, the marketability of the Notes; or
(ii) the outbreak or material escalation of hostilities involving the
United States or the declaration by the United States of a national
emergency or war, if the effect of any such occurrence on the financial
markets of the United States is such as to impair, in the reasonable
judgment of such Agent, after reasonable inquiry, the marketability of
the Notes.
(h) The Company shall have furnished to such Agent such
further information, certificates and documents as such Agent may
reasonably request from time to time. Any certificate signed by any
officer of the Company and delivered to such Agent or its counsel and
delivered explicitly pursuant to the terms of this Agreement shall be
deemed a representation and a warranty by the Company to such Agent as
to matters covered thereby, as if set forth herein.
(B) The obligations of the Purchasing Agent to purchase Notes pursuant
to any Terms Agreement entered into by it pursuant to Section 1 hereof will be
subject to the accuracy of the representations and warranties on the part of the
Company herein as of the date of such Terms Agreement and as of the Settlement
Date thereunder, to the accuracy of the statements of the Company's officers
made in each certificate furnished pursuant to the provisions hereof, to the
performance and observance by the Company of all covenants and agreements
contained herein and in such Terms Agreement on its part to be performed and
observed and to the following additional conditions precedent (which cannot be
waived by the Purchasing Agent in any respect without the consent of each other
Agent):
(a) (i) The Prospectus as amended or supplemented (including
the Pricing Supplement) with respect to such Notes shall have been
filed with the Commission pursuant to Rule 424(b) under the Act within
the applicable time period prescribed for such filing by the rules and
regulations under the Act and in accordance with Section 4(a) hereof;
(ii) no stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceeding for that purpose
shall have been initiated or threatened by the Commission; and (iii)
all requests for additional information on the part of the Commission
shall have been complied with.
(b) Upon the request of any Agent, such Agent shall have
received, appropriately updated and modified, (i) a certificate of the
Company, dated as of the Settlement Date, to the effect set forth in
Section 6(A)(d), (ii) the opinion or opinions of the counsel to the
Company or such other counsel satisfactory to such Agent, dated as of
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the Settlement Date, to the effect set forth in Section 6(A)(b), (iii)
the opinion of Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP, counsel for
the Agent, dated as of the Settlement Date, to the effect set forth in
Section 6(A)(c) and/or (iv) the letter or letters of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
LLP, dated as of the Settlement Date, to the effect set forth in
Section 6(A)(e).
(c) The conditions set forth in Sections 6(A)(f) and 6(A)(g)
shall have been satisfied.
(d) Prior to the Settlement Date, the Company shall have
furnished to any Agent such further information, certificates and
documents as such Agent may reasonably request.
If any of the conditions specified in this Section 6(B) shall not have been
fulfilled in all material respects when and as provided in this Agreement and in
such Terms Agreement, or if any of the opinions and certificates mentioned above
or elsewhere in this Agreement and in such Terms Agreement shall not be in all
material respects reasonably satisfactory in form and substance to such Agent
and its counsel, such Terms Agreement and all obligations of any Agent
thereunder may be canceled at, or at any time prior to, the Settlement Date by
such Agent. Notice of such cancellation shall be given to the Company in writing
or by telephone or telegraph confirmed in writing.
7. Indemnification and Contribution. (a) The Company will
indemnify and hold harmless each Agent against any losses, claims, damages or
liabilities, joint or several, to which such Agent may become subject, under
the Act or otherwise, insofar as such losses, claims, damages or liabilities
(or actions in respect thereof) arise out of or are based upon an untrue
statement or alleged untrue statement of a material fact contained in any
Preliminary Prospectus, the Registration Statement, the Prospectus or any
amendment or supplement to any of the foregoing, or arise out of or are based
upon the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not
misleading, and will reimburse each Agent for any legal or other expenses
reasonably incurred by such Agent in connection with investigating or defending
any such action or claim; provided, however, that the Company shall not be
liable to provide any indemnity hereunder in any such case to the extent that
any such loss, claim, damage or liability arises out of or is based upon an
untrue statement or alleged untrue statement or omission or alleged omission
made in any Preliminary Prospectus, the Registration Statement, the Prospectus,
or any amendment or supplement to any of the foregoing in reliance upon and in
conformity with written information furnished to the Company by any Agent
expressly for use in any Preliminary Prospectus, the Registration Statement,
the Prospectus or any amendment or supplement to any of the foregoing and
provided further that the Company will not be liable to provide any indemnity
hereunder to any Agent with respect to any loss, claim, damage or liability
arising out of or based upon any untrue statement or alleged untrue statement
or omission or alleged omission to state a material fact in any Preliminary
Prospectus which had been corrected in the Prospectus as amended or
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supplemented if the person asserting any such loss, claim, liability, charge or
damage purchased Notes from an Agent but was not sent or given a copy of the
Prospectus as so amended or supplemented at or prior to the written confirmation
of the sale of such Notes to such person.
(b) Each Agent, severally and not jointly, will indemnify and hold
harmless the Company against any losses, claims, damages or liabilities to which
the Company may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon an untrue statement or alleged untrue statement of a
material fact contained in any Preliminary Prospectus, the Registration
Statement, the Prospectus, or any amendment or supplement to any of the
foregoing, or arise out of or are based upon the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, in each case to the extent, but only to
the extent, that such untrue statement or alleged untrue statement or omission
or alleged omission was made in any Preliminary Prospectus, the Registration
Statement, the Prospectus, or any such amendment or supplement to any of the
foregoing in reliance upon and in conformity with written information furnished
to the Company by such Agent expressly for use therein; and will reimburse the
Company for any legal or other expenses reasonably incurred by the Company in
connection with investigating or defending any such action or claim.
(c) Promptly after receipt by an indemnified party under subsection (a)
or (b) above of notice of the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under such subsection, notify the indemnifying party in writing of the
commencement thereof, enclosing a copy of all papers served; but the omission to
so notify the indemnifying party shall not relieve it from any liability which
it may have to any indemnified party unless, and only to the extent that, such
omission results in the forfeiture of substantive rights or defenses by the
indemnifying party. In case any such action shall be brought against any
indemnified party and it shall notify the indemnifying party of the commencement
thereof, the indemnifying party shall assume the defense of any such litigation
or proceeding, including the employment of counsel and the payment of all
expenses. Such counsel shall be designated in writing by such Agent in the case
of parties indemnified pursuant to Section 7(b) and by the Company in the case
of parties indemnified pursuant to Section 7(a). Any indemnified party shall
have the right to participate in such litigation or proceeding and to retain its
own counsel, but the fees and expenses of such counsel shall be at the expense
of such indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel or (ii) the
named parties to any such proceeding (including any impleaded parties) include
(x) the indemnifying party and (y) the indemnified party and, in the written
opinion of counsel to such indemnified party, representation of both parties by
the same counsel would be inappropriate due to actual or likely conflicts of
interest between them, in either of which cases the reasonable fees and expenses
of counsel (including disbursements) for such indemnified party shall be
reimbursed by the indemnifying party to the indemnified party. If there is a
conflict as described in clause (ii) above, and the indemnified parties have
participated in the litigation or proceeding utilizing separate counsel
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whose fees and expenses have been reimbursed by the indemnifying party and the
indemnified parties, or any of them, are found to be solely liable, such
indemnified parties shall repay to the indemnifying party such fees and expenses
of such separate counsel as the indemnifying party shall have reimbursed. It is
understood that the indemnifying party shall not, in connection with any
litigation or proceeding or related litigation or proceedings in the same
jurisdiction as to which the indemnified parties are entitled to such separate
representation, be liable under this Agreement for the reasonable fees and
out-of-pocket expenses of more than one separate firm (together with not more
than one appropriate local counsel) for all such indemnified parties. Subject to
the next paragraph, all such fees and expenses shall be reimbursed by payment to
the indemnified parties of such reasonable fees and expenses of counsel promptly
after payment thereof by the indemnified parties. An indemnifying party will not
be liable for any settlement or any action or claim effected without its written
consent (which consent will not be unreasonably withheld).
In furtherance of the requirement above that fees and expenses
of any separate counsel for the indemnified parties shall be reasonable, each
Agent and the Company agree that the indemnifying party's obligations to pay
such fees and expenses shall be conditioned upon the following:
(1) in case separate counsel is proposed to be retained by the
indemnified parties pursuant to clause (ii) of the preceding paragraph,
the indemnified parties shall in good faith fully consult with the
indemnifying party in advance as to the selection of such counsel; and
(2) reimbursable fees and expenses of such separate counsel
shall be detailed and supported in a manner reasonably acceptable to
the indemnifying party (but nothing herein shall be deemed to require
the furnishing to the indemnifying party of any information, including
without limitation, computer print-outs of lawyers' daily time entries,
to the extent that, in the judgment of such counsel, furnishing such
information might reasonably be expected to result in a waiver of any
attorney-client privilege); and
(3) the Company and such Agent shall cooperate in monitoring
and controlling the fees and expenses of separate counsel for
indemnified parties for which the indemnifying party is liable
hereunder, and the indemnified party shall use every reasonable effort
to cause such separate counsel to minimize the duplication of
activities as between themselves and counsel to the indemnifying party.
(d) If the indemnification provided for in this Section 7 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or
actions in respect thereof) in such
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proportion as is appropriate to reflect the relative benefits received by the
Company on the one hand and an Agent on the other from the offering of the Notes
to which such loss, claim, damage or liability (or action in respect thereof)
relates; if, and only if, contribution solely on the basis of relative benefits
is found to be unavailable, then each indemnifying party shall contribute to the
amount paid or payable by such indemnified party as a result of such losses,
claims, damages or liabilities (or actions in respect thereof) in such
proportion as is appropriate to reflect not only such relative benefits but also
the relative fault of the Company on the one hand and such Agent on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities (or actions in respect thereof), as well as any
other relevant equitable considerations. The relative benefits received by the
Company on the one hand and such Agent on the other shall be deemed to be in the
same proportion as the total net proceeds from such offering (before deducting
expenses) received by the Company bear to the total underwriting discounts and
commissions received by such Agent, in each case as set forth in the table on
the cover page of the Prospectus as amended or supplemented to relate to a
particular offering of Notes. The relative fault shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company on the one hand or such Agent on
the other and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The Company and
each Agent agree that it would not be just and equitable if contribution
pursuant to this subsection (d) were determined by pro rata allocation (even if
the Agents were treated as one entity for such purpose) or by any other method
of allocation which does not take account of the equitable considerations
referred to above in this subsection (d). The amount paid or payable by an
indemnified party as a result of the losses, claims, damages or liabilities (or
actions in respect thereof) referred to above in this subsection (d) shall be
deemed to include any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such action
or claim. Notwithstanding the provisions of this subsection (d), no Agent shall
be required to contribute any amount in excess of the amount by which the total
price at which the applicable Notes underwritten by it and distributed to the
public were offered to the public exceeds the amount of any damages which such
Agent has otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. The obligations of the Agents in this subsection (d) to
contribute are several in proportion to their respective underwriting
obligations with respect to such Notes and not joint. Any party entitled to
contribution, promptly after receipt of notice of commencement of any action
against such party in respect of which a claim for contribution may be made
under this Section 7(d), will notify any such party or parties from whom
contribution may be sought, but the omission to so notify will not relieve the
party or parties from whom contribution may be sought from any other obligation
it or they may have under this Section 7(d). No party will be liable for
contribution with respect to any action or claim settled without its written
consent (which consent will not be unreasonably withheld).
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(e) The obligations of the Company under this Section 7 shall be in
addition to any liability which the Company may otherwise have and shall extend,
upon the same terms and conditions, to each person, if any, who controls any
Agent within the meaning of the Act; and the obligations of each Agent under
this Section 7 shall be in addition to any liability which such Agent may
otherwise have and shall extend, upon the same terms and conditions, to each
officer and director of the Company and to each person, if any, who controls the
Company within the meaning of the Act.
8. Termination.
This Agreement may be terminated at any time either by the Company as
to any of the Agents or by any of the Agents insofar as this Agreement relates
to such Agent upon the giving of written notice of such termination to such
Agent or Agents or to the Company, as the case may be; provided that Section 10
shall survive only for the term provided therein and only with respect to the
parties covered thereby. In the event of termination of this Agreement (other
than with respect to section 10), no terminating party or parties with respect
to which this Agreement is terminated shall have any liability to the other
parties hereto, except as follows: (a) as provided in the first sentence of the
fourth paragraph of Section 1 and Sections 4(c), 5, 7, 9 and 11; (b) (i) if at
the time of termination a Terms Agreement is in effect between the Purchasing
Agent and the Company but the time of delivery to any Agent of the Note or Notes
relating thereto has not occurred or (ii) if the Agent or Agents shall then own
any Note or Notes purchased pursuant to a Terms Agreement, then the Company's
representations and warranties stated in Section 3 and its obligations under the
sixth paragraph of Section 1 and Sections 4(a), 4(b), 4(d), 4(e), 4(f), 4(i),
4(j) and 4(k), with respect to clause (i) above, shall remain in full force and
effect and not be terminated and, with respect to clause (ii) above, shall
remain in full force and effect and not be terminated until the earlier of the
date on which such Notes are resold or the expiration of 90 days from such
termination; provided, however that with respect to clause (ii) above, the
Company may repurchase any such Notes from the Agents at the net price sold to
the Agents on original issuance and thereby terminate its obligations hereunder;
and (c) if the Company shall terminate this Agreement within six months of the
date hereof, other than as a result of a breach hereof by an Agent, the Company
shall be obligated, in addition to any matters covered by clauses (a) and (b) of
this Section 8, to reimburse the Agents for the reasonable out-of-pocket
expenses incurred by the Agents in connection with the execution of this
Agreement and the offering and sale of Notes including, but not limited to, the
reasonable fees and expenses of one counsel for the Agents in connection with
the establishment of the program contemplated hereby.
9. Representations and Indemnities to Survive. The respective
agreements, representations, warranties, indemnities and other statements of the
Company or its officers and of the Agents set forth in or made pursuant to this
Agreement will remain in full force and effect, regardless of any investigation
made by or on behalf of the Agents or the Company or any of the officers,
directors or controlling persons referred to in section 7 hereof, and will
survive delivery
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of and payment for the Notes, and the indemnity agreement contained in Section 7
hereof shall survive any termination of this Agreement.
10. Grant of License.
(a) Grant of Non-Exclusive License. Upon the terms and conditions
hereinafter set forth, the Purchasing Agent hereby grants to the Company and to
each other Agent (for purposes of this Section 10, each such party is referred
to as a "Licensee") and each Licensee hereby accepts a non-exclusive,
non-transferable (except as provided under paragraph (f) hereunder) license to
use the service marks owned by the Purchasing Agent in respect of the names
"General Term Notes" and "GTN" that it has used in connection with its business
activities, and in which the Purchasing Agent asserts common law interests
(hereinafter referred to collectively as "Marks") in connection with such
Licensee's furtherance of this Agreement, including use of such Marks as part of
such Licensee's marketing materials or other similar uses. No Licensee shall
have any interest in or right to use the Marks except as set forth herein.
(b) Non-Exclusivity of License. Nothing in this Section 10 shall
prevent the Purchasing Agent from granting any other license for the use of the
Marks or from utilizing the Marks or permitting the Marks to be utilized by
others in any manner whatsoever.
(c) Term. The term of this license shall continue in force as to the
Purchasing Agent and (without regard to any other Licensee) (i) with respect to
the Company, for so long as the Notes shall be outstanding and (ii) with respect
to each other Agent, for as long as this Agreement or that Co-Agent Agreement
between the Purchasing Agent and such Agent with respect to the Notes issued
under this Agreement shall be in effect, in each case subject to earlier
termination in accordance with the provisions of either this Agreement or any
such Co-Agent Agreement, as the case may be.
(d) Ownership of Marks. Each Licensee specifically acknowledges the
Purchasing Agent's ownership rights in the Marks. In connection with the use of
the Marks, no Licensee shall in any manner represent that it has any ownership
in the Marks or any registrations thereof and agrees that nothing in this
Agreement shall give such Licensee any ownership interest in any of the Marks
other than the right to use the Marks in accordance with this Section 10.
No Licensee will, during the term of this Section 10 or at any time
thereafter, attack the validity of any of the Marks or the Purchasing Agent's
interests therein, nor will any Licensee attack any application for registration
of any of the Marks, or take any position contrary to that of the Purchasing
Agent in any proceedings pertaining to registration of any of the Marks.
Each Licensee shall, whether during or after the term of this
Agreement, execute and deliver to the Purchasing Agent such documents as the
Purchasing Agent may reasonably request to establish or confirm the Purchasing
Agent's ownership interest in the Marks.
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(e) Quality Control and Regulatory Compliance. Each Licensee agrees
that it will make no use of the Marks that would tend to reflect adversely upon
the Purchasing Agent, its business reputation, the GTN business and/or market,
or would violate or reflect adversely upon the Purchasing Agent with regard to
the Commission, the NASD or any other governmental authority or securities
association or other regulatory matters. The common law understanding of the
reasonable man standard, given the facts and circumstances then facing such
Licensee, its agents and employees, shall apply when making a determination
pursuant to this paragraph (e). Any proposed use of the Marks outside of the
terms contemplated by this Paragraph shall be submitted to the Purchasing Agent
for its written approval prior to said proposed use.
(f) Assignment of Sublicense by Licensee. This Section 10 and all
rights and duties in and with respect to the Marks hereunder are personal to
each Licensee and shall not, without the prior written consent of the Purchasing
Agent, which consent may not be unreasonably withheld, be assigned, mortgaged,
sublicensed or otherwise encumbered or transferred by such Licensee, except by
operation of law. The Purchasing Agent may assign its rights under this Section
10 to any person or entity without the consent of any Licensee and upon such
assignment the Purchasing Agent shall be relieved from any further liability
under this Agreement. The Purchasing Agent shall furnish prior written notice of
any such assignment to each Licensee.
(g) Unauthorized Use. Each Licensee will notify the Purchasing Agent
in writing of any unauthorized use of any of the Marks which come to such
Licensee's attention.
(h) Indemnification; Infringement.
(I) The Purchasing Agent hereby indemnifies each Licensee and
holds it harmless from and against any loss, liability,
penalty, deficiency, damage or out-of-pocket expense
(including, without limitation, reasonable legal fees and
expenses) which such Licensee may suffer, sustain or become
subject to resulting from, arising out of or caused by any
suit, action or proceeding brought by a third party claiming
or alleging in any manner that the use of any of the Marks by
such Licensee has infringed upon the rights of others;
provided, however, that the Purchasing Agent shall not be
liable or responsible to indemnify a Licensee if the claimed
or alleged infringement results from such Licensee's violation
of this Section 10 or bad faith, willful misfeasance or gross
negligence.
(II) Each Licensee will notify the Purchasing Agent promptly in
writing of any claim that the use of any of the Marks
infringes the rights of others, or of the institution of any
legal actions or suits predicated upon such claimed
infringement, and any such suit or action will be diligently
defended at the sole expense of and under the sole control of
the Purchasing Agent.
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(i) Termination.
(I) This Section 10 shall remain in effect throughout the term
stated in paragraph (c) above until and unless it is earlier
terminated pursuant to the terms of paragraph (i)(II) below.
(II) This Section 10 may be terminated as to the Purchasing Agent
and any Licensee (without regard to another Licensee) as
follows:
A. By the Purchasing Agent in the event that such Licensee
shall fail to perform any obligation imposed upon such
Licensee by this Section 10 or violate any terms of this
Section 10. The Purchasing Agent will give such Licensee
written notice setting forth the particulars of any such
breach and, unless such Licensee has cured such breach or is
in the process of curing such breach, this Section 10 will
terminate ten (10) days after receipt by such Licensee of such
written notice. With respect to the Company, nothing in this
paragraph shall be construed to require such Licensee to
retire, redeem or repurchase any Notes issued by it pursuant
to this Distribution Agreement, or successor Distribution
Agreements, otherwise left outstanding in the event of
termination hereunder.
B. With respect to each other Agent (and not as to the
Company), in the event that any Co-Agent Agreement between the
Purchasing Agent and such Agent/Licensee terminates for any
reason, or in the event of its expiration, this Section 10
shall immediately and automatically terminate.
(j) Effect of Termination or Expiration. On termination or expiration
of this Section 10 all rights and licenses granted to each Licensee hereunder
shall immediately and automatically terminate. In such event, each Licensee
agrees to discontinue all uses of the Marks and any words confusingly similar
thereto within ten (10) days of such termination or expiration. After such
termination, no Licensee nor any affiliate of any Licensee shall allude in any
public statement or advertisement to the Marks. Each Licensee agrees that it
will at no future time adopt or use, without the Purchasing Agent's prior
written consent, a word or ▇▇▇▇ which is reasonably likely to be similar to or
confused with any of the Marks. The Purchasing Agent shall retain sole authority
and control over all of the Marks, and all rights in the Marks shall remain the
property of the Purchasing Agent.
(k) Royalty. The license granted herein shall be royalty-free.
(l) Reservation of Rights in the Marks. Rights in the Marks, other
than those specifically granted herein, are reserved by the Purchasing Agent
for its own use. Upon the termination of this Section 10 for any reason
whatsoever, all rights to the Marks shall revert to the Purchasing Agent
without the necessity of any act on its part.
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(m) Unenforceable Provisions. If any provision or part of this Section
10 is declared unenforceable by a court of competent jurisdiction, each and
every other provision, or part hereof, shall continue in full force and effect.
(n) Waiver. The failure or delay of the Purchasing Agent or any
Licensee to insist upon the performance of any of the terms and conditions of
this Section 10 or to exercise or enforce any right or obligation herein
conferred, shall not be construed to be a waiver of any such terms, conditions,
rights or obligations and either party may, within the time provided by
applicable law, take measures to enforce any or all such rights and obligations.
(o) Remedies. In the event of the breach or default in the terms of
this Section 10 by the Purchasing Agent or any Licensee, the non-breaching or
non-defaulting party shall be entitled to all legal and equitable remedies
provided by law.
The Purchasing Agent and each Licensee agree that damages may be insufficient to
compensate the Purchasing Agent in the event that any of the terms of this
Section 10 are not complied with, and therefore, agree that in such event, the
Purchasing Agent may seek injunctive relief and specific performance of the
terms hereof, in addition to all other rights or remedies, and that to obtain
such an injunction the Purchasing Agent shall not be required to show any actual
damage or to post any bond or other security.
11. Notices. All communications hereunder will be in writing and
effective only on receipt, and, if sent to the Company, will be mailed or
delivered or sent by facsimile transmission or telegraph and confirmed to it at
CMS Energy Corporation, Fairlane Plaza South, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇, Senior Vice President and
Chief Financial Officer, facsimile transmission number (▇▇▇) ▇▇▇-▇▇▇▇, and if
sent to any of the Agents, will be mailed or delivered or sent by facsimile
transmission or telegraph and confirmed to them at their respective addresses
and facsimile transmission numbers, as follows: if to ▇. ▇. ▇▇▇▇▇ & Company, to
it at ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇, facsimile transmission number (▇▇▇) ▇▇▇-▇▇▇▇. Any
party hereto may change its address or facsimile number set out in this Section
11 by a notice given to the other parties in accordance herewith.
12. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the officers
and directors and controlling persons referred to in Section 7 hereof, and no
other person will have any right or obligation hereunder. The term "successors"
as used in this Agreement shall not include a purchaser, as such purchaser, of
Notes from any Agent or from any selected dealer acting through such Agent.
13. Applicable Law. This Agreement and each Terms Agreement will be
governed by and construed in accordance with the laws of the State of New York
applicable to agreements made and to be performed wholly within such
jurisdiction, except that Section 10 of this
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Agreement will be governed by and construed in accordance with the laws of the
State of Michigan.
14. Counterparts. This Agreement may be executed in any number of
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.
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If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof, whereupon
this letter and your acceptance shall represent a binding agreement between the
Company and you.
Very truly yours,
CMS Energy Corporation
By: __________________________
Title: Senior Vice President and
Chief Financial Officer
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.
▇. ▇. ▇▇▇▇▇ & COMPANY
By: __________________________
Title: _____________________
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