REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (the "Agreement") is made and entered
into this 20th day of December, 2002, among Illinois Power Company, an Illinois
corporation (the "Company"), and ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated ("▇▇▇▇▇▇▇ ▇▇▇▇▇") and Credit Suisse First Boston Corporation
(collectively, the "Initial Purchasers").
This Agreement is made pursuant to the Purchase Agreement, dated December
17, 2002, among the Company and the Initial Purchasers (the "Purchase
Agreement"), which provides for the sale by the Company to the Initial
Purchasers of an aggregate of $400,000,000 aggregate principal amount of its
Mortgage Bonds, 11.5% Series due 2010 (the "Initial Delivery Bonds") and
$150,000,000 aggregate principal amount of its Mortgage Bonds, 11.5% Series due
2010 (the "Delayed Delivery Bonds," and, together with the Initial Delivery
Bonds, the "Securities"). In order to induce the Initial Purchasers to enter
into the Purchase Agreement, the Company has agreed to provide to the Initial
Purchasers and their direct and indirect transferees the registration rights set
forth in this Agreement. The execution and delivery of this Agreement is a
condition to the closing under the Purchase Agreement.
In consideration of the foregoing, the parties hereto agree as follows:
1. Definitions.
As used in this Agreement, the following capitalized defined terms shall
have the following meanings:
"1933 Act" shall mean the Securities Act of 1933, as amended from time
to time.
"1934 Act" shall mean the Securities Exchange Act of l934, as amended
from time to time.
"Closing Date" shall mean the Closing Time as defined in the Purchase
Agreement.
"Company" shall have the meaning set forth in the preamble and shall
also include the Company's successors.
"Depositary" shall mean The Depository Trust Company, or any other
depositary appointed by the Company, provided, however, that such
depositary must have an address in the Borough of Manhattan, in the City of
New York.
"Exchange Offer" shall mean the exchange offer by the Company of
Exchange Securities for Registrable Securities pursuant to Section 2.1
hereof.
"Exchange Offer Registration" shall mean a registration under the 1933
Act effected pursuant to Section 2.1 hereof.
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"Exchange Offer Registration Statement" shall mean an exchange offer
registration statement on Form S-4 (or, if applicable, on another
appropriate form), and all amendments and supplements to such registration
statement, including the Prospectus contained therein, all exhibits thereto
and all documents incorporated by reference therein.
"Exchange Period" shall have the meaning set forth in Section 2.1
hereof.
"Exchange Securities" shall mean the mortgage bonds issued by the
Company under the Mortgage containing terms identical to the Securities in
all material respects (except for references to certain interest rate
provisions, restrictions on transfers and restrictive legends), to be
offered to Holders of Securities in exchange for Registrable Securities
pursuant to the Exchange Offer.
"Holder" shall mean an Initial Purchaser, for so long as it owns any
Registrable Securities, and each of its successors, assigns and direct and
indirect transferees who become registered owners of Registrable Securities
under the Mortgage and each Participating Broker-Dealer that holds Exchange
Securities for so long as such Participating Broker-Dealer is required to
deliver a prospectus meeting the requirements of the 1933 Act in connection
with any resale of such Exchange Securities.
"Initial Purchaser" or "Initial Purchasers" shall have the meaning set
forth in the preamble.
"Majority Holders" shall mean the Holders of a majority of the
aggregate principal amount of Outstanding (as defined in the Mortgage)
Registrable Securities; provided that whenever the consent or approval of
Holders of a specified percentage of Registrable Securities is required
hereunder, Registrable Securities held by the Company and other obligors on
the Securities or any Affiliate (as defined in the Mortgage) of the Company
shall be disregarded in determining whether such consent or approval was
given by the Holders of such required percentage amount.
"Mortgage" shall mean the Mortgage relating to the Securities, dated
as of November 1, 1992, between the Company and BNY Midwest Trust Company,
as successor trustee to ▇▇▇▇▇▇ Trust and Savings Bank, as the same may be
amended, supplemented, waived or otherwise modified from time to time in
accordance with the terms thereof.
"Participating Broker-Dealer" shall mean any of ▇▇▇▇▇▇▇ Lynch, Pierce,
▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated, Credit Suisse First Boston Corporation and any
other broker-dealer which makes a market in the Securities and exchanges
Registrable Securities in the Exchange Offer for Exchange Securities.
"Person" shall mean an individual, partnership (general or limited),
corporation, limited liability company, trust or unincorporated
organization, or a government or agency or political subdivision thereof.
"Private Exchange" shall have the meaning set forth in Section 2.1
hereof.
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"Private Exchange Securities" shall have the meaning set forth in
Section 2.1 hereof.
"Prospectus" shall mean the prospectus included in a Registration
Statement, including any preliminary prospectus, and any such prospectus as
amended or supplemented by any prospectus supplement, including any such
prospectus supplement with respect to the terms of the offering of any
portion of the Registrable Securities covered by a Shelf Registration
Statement, and by all other amendments and supplements to a prospectus,
including post-effective amendments, and in each case including all
material incorporated by reference therein.
"Purchase Agreement" shall have the meaning set forth in the preamble.
"Registrable Securities" shall mean the Initial Delivery Bonds, and,
if issued, the Delayed Delivery Bonds, and the Private Exchange Securities;
provided, however, that the Initial Delivery Bonds and, if issued, the
Delayed Delivery Bonds and the Private Exchange Securities, shall cease to
be Registrable Securities when (i) a Registration Statement with respect to
such Securities shall have been declared effective under the 1933 Act and
such Securities shall have been disposed of pursuant to such Registration
Statement, (ii) such Securities have been sold to the public pursuant to
Rule l44 (or any similar provision then in force, but not Rule 144(A) under
the 1933 Act or are eligible to be sold to the public pursuant to Rule
144(k) under the 1933 Act, (iii) such Securities shall have ceased to be
outstanding or (iv) the Exchange Offer is consummated (except in the case
of Securities purchased from the Company and continued to be held by the
Initial Purchasers).
"Registration Expenses" shall mean any and all expenses incident to
performance of or compliance by the Company with this Agreement, including
without limitation: (i) all SEC, stock exchange or National Association of
Securities Dealers, Inc. (the "NASD") registration and filing fees,
including, if applicable, the fees and expenses of any "qualified
independent underwriter" (and its counsel) that is required to be retained
by any Holder of Registrable Securities in accordance with the rules and
regulations of the NASD, (ii) all fees and expenses incurred in connection
with compliance with state securities or blue sky laws and compliance with
the rules of the NASD (including reasonable fees and disbursements of one
firm of legal counsel for any underwriters or Holders in connection with
blue sky qualification of any of the Exchange Securities or Registrable
Securities and any filings with the NASD), (iii) all expenses of any
Persons in preparing or assisting in preparing, word processing, printing
and distributing any Registration Statement, any Prospectus, any amendments
or supplements thereto, any underwriting agreements, securities sales
agreements and other documents relating to the performance of and
compliance with this Agreement, (iv) all fees and expenses incurred in
connection with the listing, if any, of any of the Registrable Securities
on any securities exchange or exchanges, (v) all rating agency fees, (vi)
the fees and disbursements of counsel for the Company and of the
independent public accountants of the Company, including the expenses of
any special audits or "cold comfort" letters required by or incident to
such performance and compliance, (vii) the fees and expenses of the Trustee
and its counsel, and any escrow agent or custodian,
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(viii) the reasonable fees and expenses of the Initial Purchasers in
connection with the Exchange Offer, including the reasonable fees and
expenses of one firm of legal counsel to the Initial Purchasers in
connection therewith, (ix) the reasonable fees and disbursements of one
special counsel representing the Holders of Registrable Securities and (x)
any fees and disbursements of the underwriters customarily required to be
paid by issuers or sellers of securities and the fees and expenses of any
special experts retained by the Company in connection with any Registration
Statement, but excluding underwriting discounts and commissions and
transfer taxes, if any, relating to the sale or disposition of Registrable
Securities by a Holder.
"Registration Statement" shall mean any registration statement of the
Company which covers any of the Exchange Securities or Registrable
Securities pursuant to the provisions of this Agreement, and all amendments
and supplements to any such Registration Statement, including
post-effective amendments, in each case including the Prospectus contained
therein, all exhibits thereto and all material incorporated by reference
therein.
"SEC" shall mean the Securities and Exchange Commission or any
successor agency or government body performing the functions currently
performed by the United States Securities and Exchange Commission.
"Shelf Registration" shall mean a registration effected pursuant to
Section 2.2 hereof.
"Shelf Registration Statement" shall mean a "shelf" registration
statement of the Company pursuant to the provisions of Section 2.2 of this
Agreement which covers all of the Registrable Securities or all of the
Private Exchange Securities on an appropriate form under Rule 415 under the
1933 Act, or any similar rule that may be adopted by the SEC, and all
amendments and supplements to such registration statement, including
post-effective amendments, in each case including the Prospectus contained
therein, all exhibits thereto and all material incorporated by reference
therein.
"Trustee" shall mean the trustee with respect to the Securities under
the Mortgage.
2. Registration Under the ▇▇▇▇ ▇▇▇.
2.1 Exchange Offer. The Company shall, for the benefit of the Holders, at
the Company's cost, (A) prepare and file with the SEC an Exchange Offer
Registration Statement on an appropriate form under the 1933 Act with respect to
a proposed Exchange Offer and the issuance and delivery to the Holders, in
exchange for the Registrable Securities (other than Private Exchange
Securities), of a like principal amount of Exchange Securities, (B) use its
commercially reasonable efforts to cause the Exchange Offer Registration
Statement to be declared effective under the 1933 Act, (C) use its commercially
reasonable efforts to keep the Exchange Offer Registration Statement effective
until the closing of the Exchange Offer and (D) use its commercially reasonable
efforts to cause the Exchange Offer to be consummated not later than 270 days
after the Closing Date. The Exchange Securities will be issued under the
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Mortgage. Upon the effectiveness of the Exchange Offer Registration Statement,
the Company shall promptly commence the Exchange Offer, it being the objective
of such Exchange Offer to enable each Holder eligible and electing to exchange
Registrable Securities for Exchange Securities (assuming that such Holder (a) is
not an affiliate of the Company within the meaning of Rule 405 under the 1933
Act, (b) is not a broker-dealer tendering Registrable Securities acquired
directly from the Company for its own account, (c) acquired the Exchange
Securities in the ordinary course of such Holder's business and (d) has no
arrangements or understandings with any Person to participate in the Exchange
Offer for the purpose of distributing the Exchange Securities) to transfer such
Exchange Securities from and after their receipt without any limitations or
restrictions under the 1933 Act and under state securities or blue sky laws.
In connection with the Exchange Offer, the Company shall:
(a) mail as promptly as practicable to each Holder a copy of the
Prospectus forming part of the Exchange Offer Registration Statement,
together with an appropriate letter of transmittal and related documents;
(b) keep the Exchange Offer open for acceptance for a period of not
less than 30 calendar days after the date notice thereof is mailed to the
Holders (or longer if required by applicable law) (such period referred to
herein as the "Exchange Period");
(c) utilize the services of the Depositary for the Exchange Offer;
(d) permit Holders to withdraw tendered Registrable Securities at any
time prior to 5:00 p.m. (Eastern Time), on the last business day of the
Exchange Period, by sending to the institution specified in the notice, a
telegram, telex, facsimile transmission or letter setting forth the name of
such Holder, the principal amount of Registrable Securities delivered for
exchange, and a statement that such Holder is withdrawing such Holder's
election to have such Securities exchanged;
(e) notify each Holder that any Registrable Security not tendered will
remain outstanding and continue to accrue interest, but will not retain any
rights under this Agreement (except in the case of the Initial Purchasers
and Participating Broker-Dealers as provided herein); and
(f) otherwise comply in all respects with all applicable laws relating
to the Exchange Offer.
If, prior to consummation of the Exchange Offer, the Initial Purchasers
hold any Securities acquired by them and having the status of an unsold
allotment in the initial distribution, the Company upon the request of any
Initial Purchaser shall, simultaneously with the delivery of the Exchange
Securities in the Exchange Offer, issue and deliver to such Initial Purchaser in
exchange (the "Private Exchange") for the Securities held by such Initial
Purchaser, a like principal amount of mortgage bonds of the Company, that are
identical (except that such mortgage bonds shall bear appropriate transfer
restrictions) to the Exchange Securities (the "Private Exchange Securities").
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The Exchange Securities and the Private Exchange Securities shall be issued
under (i) the Mortgage or (ii) a mortgage identical in all material respects to
the Mortgage and which, in either case, has been qualified under the Trust
Indenture Act of 1939, as amended (the "TIA"), or is exempt from such
qualification and shall provide that the Exchange Securities shall not be
subject to the transfer restrictions set forth in the Mortgage but that the
Private Exchange Securities shall be subject to such transfer restrictions. The
Mortgage or such mortgage shall provide that the Exchange Securities, the
Private Exchange Securities and the Securities shall vote and consent together
on all matters as one class and that none of the Exchange Securities, the
Private Exchange Securities or the Securities will have the right to vote or
consent as a separate class on any matter. The Private Exchange Securities shall
be of the same series as and the Company shall use all commercially reasonable
efforts to have the Private Exchange Securities bear the same CUSIP number as
the Exchange Securities. The Company shall not have any liability under this
Agreement solely as a result of such Private Exchange Securities not bearing the
same CUSIP number as the Exchange Securities.
As soon as practicable after the close of the Exchange Offer and/or the
Private Exchange, as the case may be, the Company shall:
(i) accept for exchange all Registrable Securities duly tendered and
not validly withdrawn pursuant to the Exchange Offer in accordance with the
terms of the Exchange Offer Registration Statement and the letter of
transmittal which shall be an exhibit thereto;
(ii) accept for exchange all Securities properly tendered pursuant to
the Private Exchange;
(iii) deliver to the Trustee for cancellation all Registrable
Securities so accepted for exchange; and
(iv) cause the Trustee promptly to authenticate and deliver Exchange
Securities or Private Exchange Securities, as the case may be, to each
Holder of Registrable Securities so accepted for exchange in a principal
amount equal to the principal amount of the Registrable Securities of such
Holder so accepted for exchange.
Interest on each Exchange Security and Private Exchange Security will
accrue from the last date on which interest was paid on the Registrable
Securities surrendered in exchange therefor or, if no interest has been paid on
the Registrable Securities, from the date of original issuance. The Exchange
Offer and the Private Exchange shall not be subject to any conditions, other
than (i) that the Exchange Offer or the Private Exchange, or the making of any
exchange by a Holder, does not violate applicable law or any applicable
interpretation of the staff of the SEC, (ii) the due tendering of Registrable
Securities in accordance with the Exchange Offer and the Private Exchange, (iii)
that each Holder of Registrable Securities exchanged in the Exchange Offer shall
have represented that all Exchange Securities to be received by it shall be
acquired in the ordinary course of its business and that at the time of the
consummation of the Exchange Offer it shall have no arrangement or understanding
with any person to participate in the distribution (within the meaning of the
▇▇▇▇ ▇▇▇) of the Exchange Securities and shall have
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made such other representations as may be reasonably necessary under applicable
SEC rules, regulations or interpretations to render the use of Form S-4 or other
appropriate form under the 1933 Act available and (iv) that no action or
proceeding shall have been instituted or threatened in any court or by or before
any governmental agency with respect to the Exchange Offer or the Private
Exchange which, in the Company's judgment, would reasonably be expected to
impair the ability of the Company to proceed with the Exchange Offer or the
Private Exchange. If requested, the Company shall inform the Initial Purchasers
of the names and addresses of the Holders to whom the Exchange Offer is made,
and the Initial Purchasers shall have the right to contact such Holders and
otherwise facilitate the tender of Registrable Securities in the Exchange Offer.
2.2 Shelf Registration. (i) If, because of any changes in law, SEC rules or
regulations or applicable interpretations thereof by the staff of the SEC, the
Company is not permitted to effect the Exchange Offer as contemplated by Section
2.1 hereof, (ii) if for any other reason the Exchange Offer is not consummated
within 270 days after the Closing Date, (iii) upon the request of the Initial
Purchasers (but only with respect to any Registrable Securities which the
Initial Purchaser acquired directly from the Company) or (iv) if a Holder is not
permitted by the federal securities laws or applicable interpretations thereof
by the staff of the SEC to participate in the Exchange Offer or does not receive
fully tradeable Exchange Securities pursuant to the Exchange Offer, then in case
of each of clauses (i) through (iv) the Company shall, at its cost:
(a) As promptly as practicable, file with the SEC, and thereafter shall use
its commercially reasonable efforts to cause to be declared effective as
promptly as practicable but no later than 300 days after the Closing Date, a
Shelf Registration Statement relating to the offer and sale of the Registrable
Securities by the Holders from time to time in accordance with the methods of
distribution elected by the Majority Holders participating in the Shelf
Registration and set forth in such Shelf Registration Statement.
(b) Use its commercially reasonable efforts to keep the Shelf Registration
Statement continuously effective in order to permit the Prospectus forming part
thereof to be usable by Holders for a period of two years from the date the
Shelf Registration Statement is declared effective by the SEC, or for such
shorter period that will terminate when all Registrable Securities covered by
the Shelf Registration Statement have been sold pursuant to the Shelf
Registration Statement or cease to be outstanding or otherwise to be Registrable
Securities (the "Effectiveness Period"); provided, however, that the Company
shall not be obligated to keep such Shelf Registration Statement effective if
(A) any event occurs or facts are discovered which make any statement made in
such Shelf Registration Statement or the related Prospectus untrue in any
material respect or which require the making of any changes in such Shelf
Registration Statement or Prospectus in order to make the statements therein not
misleading; (B) the Company determines, in its reasonable judgment, upon advice
of counsel, as authorized by a resolution of its Board of Directors, that the
continued effectiveness and usability of such Shelf Registration Statement would
(x) require the disclosure of material information, which the Company has a bona
fide business reason for preserving as confidential, or (y) interfere with any
financing, acquisition, corporate reorganization or other material transaction
involving the Company or any of its subsidiaries, and provided, further, that
the failure to keep such Shelf Registration Statement effective and usable for
offers and sales of Registrable
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Securities for any of the foregoing reasons shall occur no more than twice in
any 12-month period and shall last no longer than 45 days in any 12-month period
whereafter Additional Interest (as defined in Section 2.5) shall become payable
in accordance with Section 2.5, and (B) the Company thereafter complies as
promptly as practicable with the requirements of Section 3(k) hereof, if
applicable. Any such period during which the Company is excused from keeping the
Shelf Registration Statement effective and usable for offers and sales of
Registrable Securities is referred to herein as a "Suspension Period"; a
Suspension Period shall commence on and include the date that the Company gives
prompt notice to the Holders that the Shelf Registration Statement is no longer
effective or the prospectus included therein is no longer usable for offers and
sales of Registrable Securities as a result of the application of the proviso
(which contains clauses (A) and (B)) of the foregoing sentence and shall end on
the earlier to occur of (1) the date on which each seller of Registrable
Securities covered by the Shelf Registration Statement either receives the
copies of the supplemented or amended prospectus contemplated by Section 3(k)
hereof or is advised in writing by the Company as promptly as practicable
following its determination that use of the prospectus may be resumed and (2)
the expiration of 45 days in any 12-month period during which one or more
Suspension Periods has been in effect. The Company shall extend the
Effectiveness Period (or the period during which Participating Broker-Dealers
are entitled to use the prospectus included in the Exchange Offer Registration
Statement in connection with the resale of the Exchange Securities, as the case
may be) by the number of days during either such period from and including the
date of the giving of such notice to and including the date which is the earlier
to occur as described in the preceding sentence.
(c) Notwithstanding any other provisions hereof, use its commercially
reasonable efforts to ensure that (i) any Shelf Registration Statement and any
amendment thereto and any Prospectus forming part thereof and any supplement
thereto complies in all material respects with the 1933 Act and the rules and
regulations thereunder, (ii) any Shelf Registration Statement and any amendment
thereto does not, when it becomes effective, 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 not misleading and (iii) any Prospectus
forming part of any Shelf Registration Statement, and any supplement to such
Prospectus (as amended or supplemented from time to time), does not include an
untrue statement of a material fact or omit to state a material fact necessary
in order to make the statements, in light of the circumstances under which they
were made, not misleading.
The Company shall not permit any securities other than Registrable
Securities to be included in the Shelf Registration Statement. The Company
further agrees, if necessary, to supplement or amend the Shelf Registration
Statement, as required by Section 3(b) below, and to furnish to the Holders of
Registrable Securities copies of any such supplement or amendment promptly after
its being used or filed with the SEC.
2.3 Expenses. The Company shall pay all Registration Expenses in connection
with the registration pursuant to Section 2.1 or 2.2. Each Holder shall pay all
underwriting discounts and commissions and transfer taxes, if any, relating to
the sale or disposition of such Holder's Registrable Securities pursuant to the
Shelf Registration Statement.
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2.4 Effectiveness. (a) The Company will be deemed not have used its
commercially reasonable efforts to cause the Exchange Offer Registration
Statement or the Shelf Registration Statement, as the case may be, to become, or
to remain, effective during the requisite period if the Company voluntarily
takes any action that would, or omits to take any action which omission would,
result in any such Registration Statement not being declared effective or in the
Holders of Registrable Securities covered thereby not being able to exchange or
offer and sell such Registrable Securities during that period as and to the
extent contemplated hereby, unless such action is required by applicable law.
(b) An Exchange Offer Registration Statement pursuant to Section 2.1 hereof
or a Shelf Registration Statement pursuant to Section 2.2 hereof will not be
deemed to have become effective unless it has been declared effective by the
SEC; provided, however, that if, after it has been declared effective, the
offering of Registrable Securities pursuant to an Exchange Offer Registration
Statement or a Shelf Registration Statement is interfered with by any stop
order, injunction or other order or requirement of the SEC or any other
governmental agency or court, such Registration Statement will be deemed not to
have become effective during the period of such interference, until the offering
of Registrable Securities pursuant to such Registration Statement may legally
resume.
2.5 Interest. The Mortgage executed in connection with the Securities will
provide that in the event that either (a) the Exchange Offer is not consummated
on or prior to the 270th calendar day after the Closing Date, (b) a Shelf
Registration Statement, if required, is not declared effective on or prior to
the 300th calendar day after the Closing Date, or (c) after the Shelf
Registration Statement has been filed and declared effective, the Shelf
Registration Statement is unusable by the Holders for any reason (including
without limitation any of the reasons described in clauses (A) or (B) of Section
2.2(b)) during the Effectiveness Period, and the aggregate number of days in any
consecutive twelve-month period for which the Shelf Registration Statement shall
not be usable exceeds 45 days in the aggregate (each such event referred to in
clauses (a) through (c) above, a "Registration Default"), the interest rate
borne by the Securities shall be increased ("Additional Interest") by
one-quarter of one percent per annum upon the occurrence of a Registration
Default, which rate will increase by one quarter of one percent each quarterly
period that such Additional Interest continues to accrue under any such
circumstance, provided that the maximum aggregate increase in the interest rate
will in no event exceed one percent 1% per annum. Additional Interest shall be
computed based on the actual number of days elapsed in each quarterly period in
which a Registration Default Exists. Following the cure of all Registration
Defaults the accrual of Additional Interest will cease and the interest rate
will revert to the original rate.
The Company shall notify the Trustee within three business days after each
and every date on which an event occurs in respect of which Additional Interest
is required to be paid (an "Event Date"). Additional Interest shall be paid by
depositing with the Trustee, in trust, for the benefit of the Holders of
Registrable Securities, on or before the applicable semiannual interest payment
date, immediately available funds in sums sufficient to pay the Additional
Interest then due. The Additional Interest due shall be payable on each interest
payment date to the record Holder of Securities entitled to receive the interest
payment to be paid on such date as set forth in the Mortgage. Each obligation to
pay Additional Interest shall be deemed to accrue from and including the day
following the applicable Event Date.
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3. Registration Procedures.
In connection with the obligations of the Company with respect to
Registration Statements pursuant to Sections 2.1 and 2.2 hereof, the Company
shall:
(a) prepare and file with the SEC a Registration Statement on the
appropriate form under the 1933 Act, which form (i) shall be selected by the
Company, (ii) shall, in the case of a Shelf Registration, be available for the
sale of the Registrable Securities by the selling Holders thereof, (iii) shall
comply as to form in all material respects with the requirements of the
applicable form and include or incorporate by reference all financial statements
required by the SEC to be filed therewith or incorporated by reference therein,
and (iv) shall comply in all material respects with the requirements of
Regulation S-T under the 1933 Act, and use its commercially reasonable efforts
to cause such Registration Statement to become effective and remain effective in
accordance with Section 2 hereof;
(b) prepare and file with the SEC such amendments and post-effective
amendments to each Registration Statement as may be necessary under applicable
law to keep such Registration Statement effective for the applicable period; and
cause each Prospectus to be supplemented by any required prospectus supplement,
and as so supplemented to be filed pursuant to Rule 424 (or any similar
provision then in force) under the 1933 Act and comply with the provisions of
the 1933 Act, the 1934 Act and the rules and regulations thereunder applicable
to them with respect to the disposition of all securities covered by each
Registration Statement during the applicable period in accordance with the
intended method or methods of distribution by the selling Holders thereof
(including sales by any Participating Broker-Dealer);
(c) in the case of a Shelf Registration, (i) notify each Holder of
Registrable Securities, at least five business days prior to filing, that a
Shelf Registration Statement with respect to the Registrable Securities is being
filed and advising such Holders that the distribution of Registrable Securities
will be made in accordance with the method selected by the Majority Holders
participating in the Shelf Registration; (ii) furnish to each Holder of
Registrable Securities and to each underwriter of an underwritten offering of
Registrable Securities, if any, without charge, as many copies of each
Prospectus, including each preliminary Prospectus, and any amendment or
supplement thereto and such other documents as such Holder or underwriter may
reasonably request, including financial statements and schedules and, if the
Holder so requests, all exhibits in order to facilitate the public sale or other
disposition of the Registrable Securities; and (iii) hereby consent to the use
of the Prospectus or any amendment or supplement thereto by each of the selling
Holders of Registrable Securities in connection with the offering and sale of
the Registrable Securities covered by the Prospectus or any amendment or
supplement thereto;
(d) use its commercially reasonable efforts to register or qualify the
Registrable Securities under all applicable state securities or "blue sky" laws
of such jurisdictions as any Holder of Registrable Securities covered by a
Registration Statement and each underwriter of an underwritten offering of
Registrable Securities shall reasonably request by the time the applicable
Registration Statement is declared effective by the SEC, and do any and all
other acts and things which may be reasonably necessary or advisable to enable
each such Holder and underwriter to consummate the disposition in each such
jurisdiction of such
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Registrable Securities owned by such Holder; provided, however, that the Company
shall not be required to (i) qualify as a foreign corporation or as a dealer in
securities in any jurisdiction where it would not otherwise be required to
qualify but for this Section 3(d), or (ii) take any action which would subject
it to general service of process or taxation in any such jurisdiction where it
is not then so subject;
(e) notify promptly each Holder of Registrable Securities under a Shelf
Registration or any Participating Broker-Dealer who has notified the Company
that it is utilizing the Exchange Offer Registration Statement as provided in
paragraph (f) below and, if requested by such Holder or Participating
Broker-Dealer, confirm such advice in writing promptly (i) when a Registration
Statement has become effective and when any post-effective amendments and
supplements thereto become effective, (ii) of any request by the SEC or any
state securities authority for post-effective amendments and supplements to a
Registration Statement and Prospectus or for additional information after the
Registration Statement has become effective, (iii) of the issuance by the SEC or
any state securities authority of any stop order suspending the effectiveness of
a Registration Statement or the initiation of any proceedings for that purpose,
(iv) in the case of a Shelf Registration, if, between the effective date of a
Registration Statement and the closing of any sale of Registrable Securities
covered thereby, the representations and warranties of the Company contained in
any underwriting agreement, securities sales agreement or other similar
agreement, if any, relating to the offering cease to be true and correct in all
material respects, (v) if at any time when a Prospectus is required to be
delivered under the Securities Act, that such Registration Statement,
Prospectus, prospectus amendment or supplement or post-effective amendment does
not conform in all material respects to the applicable requirements of the
Securities Act and the Trust Indenture Act and the rules and regulations of the
SEC thereunder, (vi) of the happening of any event or the discovery of any facts
during the period a Shelf Registration Statement is effective which makes any
statement made in such Registration Statement or the related Prospectus untrue
in any material respect or which requires the making of any changes in such
Registration Statement or Prospectus in order to make the statements therein not
misleading, (vii) of the receipt by the Company of any notification with respect
to the suspension of the qualification of the Registrable Securities or the
Exchange Securities, as the case may be, for sale in any jurisdiction or the
initiation or threatening of any proceeding for such purpose and (viii) of any
determination by the Company that a post-effective amendment to such
Registration Statement would be appropriate;
(f) (A) in the case of the Exchange Offer Registration Statement (i)
include in the Exchange Offer Registration Statement a section entitled "Plan of
Distribution" which section shall be reasonably acceptable to ▇▇▇▇▇▇▇ ▇▇▇▇▇ on
behalf of the Participating Broker-Dealers, and which shall contain a summary
statement of the positions taken or policies made by the staff of the SEC with
respect to the potential "underwriter" status of any broker-dealer that holds
Registrable Securities acquired for its own account as a result of market-making
activities or other trading activities and that will be the beneficial owner (as
defined in Rule 13d-3 under the Exchange Act) of Exchange Securities to be
received by such broker-dealer in the Exchange Offer, whether such positions or
policies have been publicly disseminated by the staff of the SEC or such
positions or policies, in the reasonable judgment of ▇▇▇▇▇▇▇ ▇▇▇▇▇ on behalf of
the Participating Broker-Dealers and its counsel, represent the prevailing views
of the staff of the SEC, including a statement that any such broker-dealer who
receives Exchange Securities for
11
Registrable Securities pursuant to the Exchange Offer may be deemed a statutory
underwriter and must deliver a prospectus meeting the requirements of the 1933
Act in connection with any resale of such Exchange Securities, (ii) include in
the Exchange Offer Registration Statement a Prospectus for use in any resales by
any Participating Broker-Dealer, (iii) keep such Exchange Offer Registration
Statement effective for a period of up to 180 days after the last date
Registrable Securities are accepted in the Exchange Offer (as such period may be
extended pursuant to the third to last paragraph of Section 3 of this
Agreement), if requested by the Initial Purchasers or by one or more
Participating Broker-Dealers, (iv) furnish to each Participating Broker-Dealer
who has delivered to the Company the notice referred to in Section 3(e), without
charge, as many copies of each Prospectus included in the Exchange Offer
Registration Statement, including any preliminary prospectus, and any amendment
or supplement thereto, as such Participating Broker-Dealer may reasonably
request, (v) hereby consent to the use of the Prospectus forming part of the
Exchange Offer Registration Statement or any amendment or supplement thereto, by
any Person subject to the prospectus delivery requirements of the SEC, including
all Participating Broker-Dealers, in connection with the sale or transfer of the
Exchange Securities covered by the Prospectus or any amendment or supplement
thereto, and (vi) include in the transmittal letter or similar documentation to
be executed by an exchange offeree in order to participate in the Exchange Offer
(x) the following provision:
"If the exchange offeree is a broker-dealer holding Registrable
Securities acquired for its own account as a result of market-making
activities or other trading activities, it will deliver a prospectus
meeting the requirements of the 1933 Act in connection with any resale
of Exchange Securities received in respect of such Registrable
Securities pursuant to the Exchange Offer;" and
(y) a statement to the effect that by a broker-dealer making the
acknowledgment described in clause (x) and by delivering a Prospectus in
connection with the exchange of Registrable Securities, the broker-dealer will
not be deemed to admit that it is an underwriter within the meaning of the 1933
Act; and
(B) in the case of any Exchange Offer Registration Statement, the Company
agrees to deliver to the Initial Purchasers, upon their request, on behalf of
the Participating Broker-Dealers upon the effectiveness of the Exchange Offer
Registration Statement (i) an opinion of counsel or opinions of counsel
substantially in the form attached hereto as Exhibit A, (ii) officers'
certificates substantially in the form customarily delivered in a public
offering of mortgage bonds and agrees to use its reasonable efforts to deliver a
comfort letter or comfort letters in customary form to the extent permitted by
Statement on Auditing Standards No. 72 of the American Institute of Certified
Public Accountants (or if such a comfort letter is not permitted, an agreed upon
procedures letter in customary form) from the Company's independent certified
public accountants (and, if necessary, any other independent certified public
accountants of any subsidiary of the Company or of any business acquired by the
Company for which financial statements are, or are required to be, included in
the Registration Statement) at least as broad in scope and coverage as the
comfort letter or comfort letters delivered to the Initial Purchasers in
connection with the initial sale of the Securities to the Initial Purchasers;
12
(g) (i) in the case of an Exchange Offer, furnish counsel for the Initial
Purchasers and (ii) in the case of a Shelf Registration, furnish counsel for the
Holders of Registrable Securities copies of any comment letters received from
the SEC or any other request by the SEC or any state securities authority for
amendments or supplements to a Registration Statement and Prospectus or for
additional information;
(h) use its commercially reasonable efforts to obtain the withdrawal of any
order suspending the effectiveness of a Registration Statement at the earliest
possible moment;
(i) in the case of a Shelf Registration, furnish, upon request, to each
Holder of Registrable Securities, and each underwriter, if any, without charge,
at least one conformed copy of each Registration Statement and any
post-effective amendment thereto, including financial statements and schedules
(without documents incorporated therein by reference and all exhibits thereto,
unless requested);
(j) in the case of a Shelf Registration, cooperate with the selling Holders
of Registrable Securities to facilitate the timely preparation and delivery of
certificates representing Registrable Securities to be sold and not bearing any
restrictive legends; and enable such Registrable Securities to be in such
denominations (consistent with the provisions of the Mortgage) and registered in
such names as the selling Holders or the underwriters, if any, may reasonably
request at least three business days prior to the closing of any sale of
Registrable Securities;
(k) in the case of a Shelf Registration, upon the occurrence of any event
or the discovery of any facts, each as contemplated by Sections 3(e)(vi) and
3(e)(vii) hereof, as promptly as practicable after the occurrence of such an
event, use its commercially reasonable efforts to prepare a supplement or
post-effective amendment to the Registration Statement or the related Prospectus
or any document incorporated therein by reference or file any other required
document so that, as thereafter delivered to the purchasers of the Registrable
Securities or Participating Broker-Dealers, such Prospectus will not contain at
the time of such delivery any untrue statement of a material fact or omit to
state a material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading or will remain so
qualified. At such time as such public disclosure is otherwise made or the
Company determines that such disclosure is not necessary, in each case to
correct any misstatement of a material fact or to include any omitted material
fact, the Company agrees promptly to notify each Holder of such determination
and to furnish each Holder such number of copies of the Prospectus as amended or
supplemented, as such Holder may reasonably request;
(l) in the case of a Shelf Registration, a reasonable time prior to the
filing of any Registration Statement, any Prospectus, any amendment to a
Registration Statement or amendment or supplement to a Prospectus after initial
filing of a Registration Statement, provide copies of such document to the
Initial Purchasers on behalf of such Holders; and make representatives of the
Company as shall be reasonably requested by the Majority Holders of Registrable
Securities who have been identified to the Company, or the Initial Purchasers on
behalf of such Holders, available for discussion of such document;
13
(m) obtain a CUSIP number for all Exchange Securities, Private Exchange
Securities or Registrable Securities, as the case may be, not later than the
effective date of a Registration Statement, and provide the Trustee with printed
certificates for the Exchange Securities, Private Exchange Securities or the
Registrable Securities, as the case may be, in a form eligible for deposit with
the Depositary;
(n) use their commercially reasonable efforts to obtain the consent or
approval of each governmental agency or authority, whether federal, state or
local, which may be required to effect the Exchange Offer Registration, the
Exchange Offer or the Shelf Registration, as the case may be, or the offering or
sale in connection therewith or to enable the Holders to offer, or to consummate
the disposition of, their Registrable Securities or Participating Broker-Dealers
to offer and sell Exchange Securities;
(o) (i) cause the Mortgage to be qualified under the TIA in connection with
the registration of the Exchange Securities or Registrable Securities, as the
case may be, (ii) cooperate with the Trustee and the Holders to effect such
changes to the Mortgage as may be required for the Mortgage to be so qualified
in accordance with the terms of the TIA and (iii) execute, and use its
commercially reasonable efforts to cause the Trustee to execute, all documents
as may be required to effect such changes, and all other forms and documents
required to be filed with the SEC to enable the Mortgage to be so qualified in a
timely manner;
(p) in the case of a Shelf Registration, if requested by any Holder of
Registrable Securities covered by a Shelf Registration Statement, promptly
incorporate in a prospectus supplement or post-effective amendment such
information with respect to such Holder as such Holder reasonably requests to be
included therein; and make all required filings of such prospectus supplement or
such post-effective amendment promptly after the Company has received
notification of the matters to be incorporated in such filing;
(q) in the case of a Shelf Registration, enter into agreements (including
underwriting agreements) and take all other customary and appropriate actions in
order to expedite or facilitate the disposition of such Registrable Securities
and in such connection whether or not an underwriting agreement is entered into
and whether or not the registration is an underwritten registration:
(i) make such representations and warranties to the Holders of such
Registrable Securities and the underwriters, if any, in form, substance and
scope as are customarily made by issuers to underwriters in similar
underwritten offerings as may be reasonably requested by them;
(ii) obtain opinions of counsel to the Company and updates thereof
(which counsel and opinions (in form, scope and substance) shall be
reasonably satisfactory to the managing underwriters, if any, and the
Holders of a majority in principal amount of the Registrable Securities
being sold) addressed to each selling Holder and the underwriters, if any,
covering the matters customarily covered in opinions requested in sales of
securities or underwritten offerings and such other matters as may be
reasonably requested by such Holders and underwriters;
14
(iii) if requested by the managing underwriters, use its reasonable
efforts to obtain "cold comfort" letters and updates thereof from the
Company's independent certified public accountants, and an officer's
certificate from the chief accounting officer of the Company (and, if
necessary, any other independent certified public accountants of any
subsidiary of the Company or of any business acquired by the Company for
which financial statements are, or are required to be, included in the
Registration Statement) addressed to the underwriters, if any, and use
reasonable efforts to have such letter and certificate addressed to the
selling Holders of Registrable Securities (to the extent consistent with
Statement on Auditing Standards No. 72 of the American Institute of
Certified Public Accounts), such letters and certificate to be in customary
form and covering matters of the type customarily covered in "cold comfort"
letters to underwriters in connection with similar underwritten offerings;
(iv) if requested by the Majority Holders, enter into a securities
sales agreement with the Holders and an agent of the Holders providing for,
among other things, the appointment of such agent for the selling Holders
for the purpose of soliciting purchases of Registrable Securities, which
agreement shall be in form, substance and scope customary for similar
offerings;
(v) if an underwriting agreement is entered into, cause the same to
set forth indemnification provisions and procedures substantially
equivalent to the indemnification provisions and procedures set forth in
Section 4 hereof with respect to the underwriters and all other parties to
be indemnified pursuant to said Section or, at the request of any
underwriters, in the form customarily provided to such underwriters in
similar types of transactions; and
(vi) deliver such documents and certificates as may be reasonably
requested and as are customarily delivered in similar offerings to the
Holders of a majority in principal amount of the Registrable Securities
being sold and the managing underwriters, if any.
The above shall be done at each pricing and closing under any underwriting or
similar agreement as and to the extent required thereunder;
(r) in the case of a Shelf Registration or if a Prospectus is required to
be delivered by any Participating Broker-Dealer in the case of an Exchange
Offer, make available for inspection by representatives of the Holders of the
Registrable Securities, any underwriters participating in any disposition
pursuant to a Shelf Registration Statement, any Participating Broker-Dealer and
any counsel or accountant retained by any of the foregoing, all financial and
other records, pertinent corporate documents and properties of the Company
reasonably requested by any such persons, and cause the respective officers,
directors, employees and any other agents of the Company to supply all
information reasonably requested by any such representative, underwriter,
special counsel or accountant in connection with a Registration Statement, and
make such representatives of the Company available for discussion of such
documents as shall be reasonably requested by the Initial Purchasers;
15
(s) (i) in the case of an Exchange Offer Registration Statement, a
reasonable time prior to the filing of any Exchange Offer Registration
Statement, any Prospectus forming a part thereof, any amendment to an Exchange
Offer Registration Statement or amendment or supplement to such Prospectus,
provide copies of such document to the Initial Purchasers and to one firm of
legal counsel to the Holders of Registrable Securities and make such changes in
any such document prior to the filing thereof as the Initial Purchasers or such
counsel to the Holders of Registrable Securities may reasonably request and,
except as otherwise required by applicable law, not file any such document in a
form to which the Initial Purchasers on behalf of the Holders of Registrable
Securities and one firm of legal counsel to the Holders of Registrable
Securities shall not have previously been advised and furnished a copy of or to
which the Initial Purchasers on behalf of the Holders of Registrable Securities
or such counsel to the Holders of Registrable Securities shall reasonably
object, and make the representatives of the Company available for discussion of
such documents as shall be reasonably requested by the Initial Purchasers; and
(ii) in the case of a Shelf Registration, a reasonable time prior to
filing any Shelf Registration Statement, any Prospectus forming a part
thereof, any amendment to such Shelf Registration Statement, provide copies
of such document to the Holders of Registrable Securities who have been
identified to the Company, to the Initial Purchasers, to one firm of legal
counsel for the Holders and to the underwriter or underwriters of an
underwritten offering of Registrable Securities, if any, make such changes
in any such document prior to the filing thereof as the Initial Purchasers,
such counsel to the Holders or the underwriter or underwriters reasonably
request and not file any such document in a form to which the Majority
Holders who have been identified to the Company, the Initial Purchasers on
behalf of the Holders of Registrable Securities, counsel for the Holders of
Registrable Securities or any underwriter shall not have previously been
advised and furnished a copy of or to which the Majority Holders who have
been identified to the Company, the Initial Purchasers of behalf of the
Holders of Registrable Securities, counsel to the Holders of Registrable
Securities or any underwriter shall reasonably object, and make the
representatives of the Company available for discussion of such document as
shall be reasonably requested by the Majority Holders of Registrable
Securities who have been identified to the Company, the Initial Purchasers
on behalf of such Holders, counsel for the Holders of Registrable
Securities or any underwriter.
(t) in the case of a Shelf Registration, use its commercially reasonable
efforts to cause all Registrable Securities to be listed on any securities
exchange on which similar mortgage bonds issued by the Company are then listed
if requested by the Majority Holders, or if requested by the underwriter or
underwriters of an underwritten offering of Registrable Securities, if any;
(u) in the case of a Shelf Registration, use its commercially reasonable
efforts to cause the Registrable Securities to be rated by the appropriate
rating agencies, if so requested by the Majority Holders, or if requested by the
underwriter or underwriters of an underwritten offering of Registrable
Securities, if any;
16
(v) otherwise comply with all applicable rules and regulations of the SEC
and make available to its security holders, as soon as reasonably practicable,
an earnings statement covering at least 12 months which shall satisfy the
provisions of Section 11(a) of the 1933 Act and Rule 158 thereunder;
(w) cooperate and assist in any filings required to be made with the NASD
and, in the case of a Shelf Registration, in the performance of any due
diligence investigation by any underwriter and its counsel (including any
"qualified independent underwriter" that is required to be retained in
accordance with the rules and regulations of the NASD); and
(x) upon consummation of an Exchange Offer or a Private Exchange, obtain a
customary opinion of counsel to the Company addressed to the Trustee for the
benefit of all Holders of Registrable Securities participating in the Exchange
Offer or Private Exchange, and which includes an opinion that (i) the Company
has duly authorized, executed and delivered the Exchange Securities and/or
Private Exchange Securities, as applicable, and the related supplemental
indenture, and (ii) each of the Exchange Securities and related supplemental
indenture constitute a legal, valid and binding obligation of the Company,
enforceable against the Company in accordance with its respective terms (with
customary exceptions).
In the case of a Shelf Registration Statement, the Company may (as a
condition to such Holder's participation in the Shelf Registration) require each
Holder of Registrable Securities to furnish to the Company such information
regarding the Holder and the proposed distribution by such Holder of such
Registrable Securities as the Company may from time to time reasonably request
in writing.
In the case of a Shelf Registration Statement, each Holder agrees that,
upon receipt of any notice from the Company of the happening of any event or the
discovery of any facts, each of the kind described in Section 3(e)(vi) hereof,
such Holder will forthwith discontinue disposition of Registrable Securities
pursuant to a Registration Statement until such Holder's receipt of the copies
of the supplemented or amended Prospectus contemplated by Section 3(k) hereof,
and, if so directed by the Company, such Holder will deliver to the Company (at
its expense) all copies in such Holder's possession, other than permanent file
copies then in such Holder's possession, of the Prospectus covering such
Registrable Securities current at the time of receipt of such notice.
If the Company shall give any such notice to suspend the disposition of
Registrable Securities pursuant to a Registration Statement, the Company shall
extend the period during which the Registration Statement shall be maintained
effective pursuant to this Agreement by the number of days during the period
from and including the date of the giving of such notice to and including the
date when the Holders shall have received copies of the supplemented or amended
Prospectus necessary to resume such dispositions. The Company may give any such
notice only twice during any 365-day period and each such suspension shall not
extend for a period of more than 45 days.
In the event that the Company fails to effect the Exchange Offer or file
any Shelf Registration Statement and maintain the effectiveness of any Shelf
Registration Statement as
17
provided herein, the Company shall not file any Registration Statement with
respect to any securities (within the meaning of Section 2(1) of the ▇▇▇▇ ▇▇▇)
of the Company other than Registrable Securities.
If any of the Registrable Securities covered by any Shelf Registration
Statement are to be sold in an underwritten offering, the underwriter or
underwriters and manager or managers that will manage such offering will be
selected by the Majority Holders of such Registrable Securities included in such
offering and shall be acceptable to the Company. No Holder of Registrable
Securities may participate in any underwritten registration hereunder unless
such Holder (a) agrees to sell such Holder's Registrable Securities on the basis
provided in any underwriting arrangements approved by the persons entitled
hereunder to approve such arrangements and (b) completes and executes all
questionnaires, powers of attorney, indemnities, underwriting agreements and
other documents required under the terms of such underwriting arrangements.
4. Indemnification; Contribution.
(a) Indemnification of the Initial Purchasers and the Holders. The Company
agrees to indemnify and hold harmless the Initial Purchasers, each Holder, each
Participating Broker-Dealer, each Person who participates as an underwriter (any
such Person being an "Underwriter") and each Person, if any, who controls any
Holder or Underwriter within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act as follows:
(i) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of any untrue statement or alleged
untrue statement of a material fact contained in any Registration Statement
(or any amendment or supplement thereto) pursuant to which Exchange
Securities or Registrable Securities were registered under the 1933 Act,
including all documents incorporated therein by reference, or the omission
or alleged omission therefrom of a material fact required to be stated
therein or necessary to make the statements therein not misleading, or
arising out of any untrue statement or alleged untrue statement of a
material fact contained in any Prospectus (or any amendment or supplement
thereto) or the omission or alleged omission therefrom of a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission; provided that (subject to Section
4(d) below) any such settlement is effected with the written consent of the
Company; and
(iii) against any and all expense whatsoever, as incurred (including
the fees and disbursements of counsel chosen by any indemnified party),
reasonably incurred in investigating, preparing or defending against any
litigation, or any
18
investigation or proceeding by any governmental agency or body, commenced
or threatened, or any claim whatsoever based upon any such untrue statement
or omission, or any such alleged untrue statement or omission, to the
extent that any such expense is not paid under subparagraph (i) or (ii)
above;
provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission (i) made in
reliance upon and in conformity with written information furnished to the
Company by the Holder or Underwriter expressly for use in a Registration
Statement (or any amendment thereto) or any Prospectus (or any amendment or
supplement thereto) or (ii) if the Person asserting any such loss, liability,
claim, damage or expense was not sent or given a copy of the final Prospectus
(or any amendment or supplement thereto) (in each case exclusive of the
documents from which information is incorporated by reference) at or prior to
the written confirmation of the sale of such Registrable Securities to such
Person (other than as a result of the failure by the Company to comply with its
obligations under Section 3(c) hereof) and the untrue statement contained in or
omitted from the Prospectus delivered to such Person was subsequently corrected
in the final Prospectus (or any amendment or supplement thereto).
(b) Indemnification of the Company. Each Holder severally, but not jointly,
agrees to indemnify and hold harmless the Company, the Initial Purchasers, each
Underwriter and the other selling Holders, and each of their respective
directors and officers, and each Person, if any, who controls the Company, the
Initial Purchasers, any Underwriter or any other selling Holder within the
meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act, against any
and all loss, liability, claim, damage and expense described in the indemnity
contained in Section 4(a) hereof, as incurred, but only with respect to untrue
statements or omissions, or alleged untrue statements or omissions, made in any
Registration Statement (or any amendment thereto) or any Prospectus included
therein (or any amendment or supplement thereto) in reliance upon and in
conformity with written information with respect to such Holder furnished to the
Company by such Holder expressly for use in such Registration Statement (or any
amendment thereto) or such Prospectus (or any amendment or supplement thereto);
provided, however, that no such Holder shall be liable for any claims hereunder
in excess of the amount of net proceeds received by such Holder from the sale of
Registrable Securities pursuant to such Registration Statement.
(c) Notices and Procedures. Each indemnified party shall give notice as
promptly as reasonably practicable to each indemnifying party of any action or
proceeding commenced against it in respect of which indemnity may be sought
hereunder, but failure so to notify an indemnifying party shall not relieve such
indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from any liability which it may have otherwise than on account of this indemnity
agreement. If any such proceeding shall be brought or asserted against an
indemnified party and it shall have notified the indemnifying party thereof, the
indemnifying party shall retain counsel reasonably satisfactory to the
indemnified party to represent the indemnified party and any others entitled to
indemnification pursuant to this Section 4 that the indemnifying party may
designate in such proceeding and shall pay the fees and expenses of such counsel
related to such proceeding. An indemnifying party may participate at its own
expense in the defense of such
19
action; provided, however, that counsel to the indemnifying party shall not
(except with the consent of the indemnified party) also be counsel to the
indemnified party. In no event shall the indemnifying party or parties be liable
for the fees and expenses of more than one counsel (in addition to any local
counsel) separate from their own counsel for all indemnified parties in
connection with any one action or separate but similar or related actions in the
same jurisdiction arising out of the same general allegations or circumstances.
No indemnifying party shall, without the prior written consent of the
indemnified parties, settle or compromise or consent to the entry of any
judgment with respect to any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim
whatsoever in respect of which indemnification or contribution could be sought
under this Section 4 (whether or not the indemnified parties are actual or
potential parties thereto), unless such settlement, compromise or consent (i)
includes an unconditional release of each indemnified party from all liability
arising out of such litigation, investigation, proceeding or claim and (ii) does
not include a statement as to or an admission of fault, culpability or a failure
to act by or on behalf of any indemnified party.
If at any time an indemnified party shall have requested an indemnifying
party to reimburse the indemnified party for fees and expenses of counsel, such
indemnifying party agrees that it shall be liable for any settlement of the
nature contemplated by Section 4(a)(ii) effected without its written consent if
(i) such settlement is entered into more than 45 days after receipt by such
indemnifying party of the aforesaid request, (ii) such indemnifying party shall
have received notice of the terms of such settlement at least 30 days prior to
such settlement being entered into and (iii) such indemnifying party shall not
have reimbursed such indemnified party in accordance with such request prior to
the date of such settlement.
(d) Contribution. If the indemnification provided for in this Section 4 is
for any reason unavailable to or insufficient to hold harmless an indemnified
party in respect of any losses, liabilities, claims, damages or expenses
referred to therein, then each indemnifying party shall contribute to the
aggregate amount of such losses, liabilities, claims, damages and expenses
incurred by such indemnified party, as incurred, (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company from the
offering of the Securities and the Exchange Securities, on the one hand, and by
the Holders from receiving Securities or Exchange Securities registered under
the Securities Act, on the other hand, or (ii) if the allocation provided by
clause (i) is not permitted by applicable law, in such proportion as is
appropriate to reflect the relative fault of the Company on the one hand and the
Holders and the Initial Purchasers on the other hand in connection with the
statements or omissions which resulted in such losses, liabilities, claims,
damages or expenses, as well as any other relevant equitable considerations.
The relative fault of the Company on the one hand and the Holders and the
Initial Purchasers on the other hand shall be determined by reference to, among
other things, whether any such untrue or alleged untrue statement of a material
fact or omission or alleged omission to state a material fact relates to
information supplied by the Company, the Holders or the Initial Purchasers and
the parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission.
20
(e) Limitation on Liability. The Company, the Holders and the Initial
Purchasers agree that it would not be just and equitable if contribution
pursuant to this Section 4 were determined by pro rata allocation (even if the
Initial Purchasers 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 Section 4. The aggregate amount of losses,
liabilities, claims, damages and expenses incurred by an indemnified party and
referred to above in this Section 4 shall be deemed to include any legal or
other expenses reasonably incurred by such indemnified party in investigating,
preparing or defending against any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or threatened, or any
claim whatsoever based upon any such untrue or alleged untrue statement or
omission or alleged omission. Notwithstanding the provisions of this Section 4,
no Initial Purchaser shall be required to contribute any amount in excess of the
amount by which the total price at which the Securities sold by it were offered
exceeds the amount of any damages which such Initial Purchaser 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 ▇▇▇▇ ▇▇▇) shall be entitled to
contribution from any Person who was not guilty of such fraudulent
misrepresentation.
(f) Non-Exclusive Remedies. The remedies provided for in this Section 4 are
not exclusive and shall not limit any rights or remedies that may otherwise be
available to any indemnified party at law or in equity.
(g) Survival. The indemnity and contribution provisions contained in this
Section 4 shall remain operative and in full force and effect regardless of (i)
any termination of this Agreement, (ii) any investigation made by or on behalf
of the Initial Purchasers or any other Holder, their respective affiliates or
any Person controlling any Initial Purchaser or any other Holder, or by or on
behalf of the Company, their respective affiliates or the officers or directors
of or any Person controlling the Company, (iii) acceptance of any of the
Exchange Securities and (iv) any sale of Registrable Securities pursuant to a
Shelf Registration Statement.
For purposes of this Section 4, each Person, if any, who controls an
Initial Purchaser or Holder within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act shall have the same rights to contribution as such
Initial Purchaser or Holder, and each director of the Company, and each Person,
if any, who controls the Company within the meaning of Section 15 of the 1933
Act or Section 20 of the 1934 Act shall have the same rights to contribution as
the Company. The Initial Purchasers' respective obligations to contribute
pursuant to this Section 4 are several in proportion to the principal amount of
Securities set forth opposite their respective names in Schedule A to the
Purchase Agreement and not joint.
5. Miscellaneous.
5.1 Rule 144 and Rule 144A. For so long as the Company is subject to the
reporting requirements of Section 13 or 15 of the 1934 Act, the Company
covenants that it will file the reports required to be filed by it under the
1933 Act and Section 13(a) or 15(d) of the 1934 Act and the rules and
regulations adopted by the SEC thereunder. If the Company ceases to be so
required to file such reports, the Company covenants that it will upon the
request of any Holder of Registrable Securities (a) make publicly available such
information as is necessary to
21
permit sales pursuant to Rule 144 under the 1933 Act, (b) deliver such
information to a prospective purchaser as is necessary to permit sales pursuant
to Rule 144A under the 1933 Act and it will take such further action as any
Holder of Registrable Securities may reasonably request, and (c) take such
further action that is reasonable in the circumstances, in each case, to the
extent required from time to time to enable such Holder to sell its Registrable
Securities without registration under the 1933 Act within the limitation of the
exemptions provided by (i) Rule 144 under the 1933 Act, as such Rule may be
amended from time to time, (ii) Rule 144A under the 1933 Act, as such Rule may
be amended from time to time, or (iii) any similar rules or regulations
hereafter adopted by the SEC. Upon the request of any Holder of Registrable
Securities, the Company will deliver to such Holder a written statement as to
whether it has complied with such requirements.
5.2 No Inconsistent Agreements. The Company has not entered into and the
Company will not after the date of this Agreement enter into any agreement which
is inconsistent with the rights granted to the Holders of Registrable Securities
in this Agreement or otherwise conflicts with the provisions hereof. The rights
granted to the Holders hereunder do not and will not for the term of this
Agreement in any way conflict with the rights granted to the holders of the
Company's other issued and outstanding securities under any such agreements.
5.3 Amendments and Waivers. The provisions of this Agreement, including the
provisions of this sentence, may not be amended, modified or supplemented, and
waivers or consents to departures from the provisions hereof may not be given
unless the Company has obtained the written consent of Holders of at least a
majority in aggregate principal amount of the outstanding Registrable Securities
affected by such amendment, modification, supplement, waiver or departure.
5.4 Notices. All notices and other communications provided for or permitted
hereunder shall be made in writing by hand delivery, registered first-class
mail, telex, telecopier, or any courier guaranteeing overnight delivery (a) if
to a Holder, at the most current address given by such Holder to the Company by
means of a notice given in accordance with the provisions of this Section 5.4,
which address initially is the address set forth in the Purchase Agreement with
respect to the Initial Purchasers; and (b) if to the Company, initially at the
Company's address set forth in the Purchase Agreement, and thereafter at such
other address of which notice is given in accordance with the provisions of this
Section 5.4.
All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; two business days
after being deposited in the mail, postage prepaid, if mailed; when answered
back, if telexed; when receipt is acknowledged, if telecopied; and on the next
business day if timely delivered to an air courier guaranteeing overnight
delivery.
Copies of all such notices, demands, or other communications shall be
concurrently delivered by the person giving the same to the Trustee under the
Mortgage, at the address specified in such Mortgage.
5.5 Successor and Assigns. This Agreement shall inure to the benefit of and
be binding upon the successors, assigns and transferees of each of the parties,
including, without
22
limitation and without the need for an express assignment, subsequent Holders;
provided that nothing herein shall be deemed to permit any assignment, transfer
or other disposition of Registrable Securities in violation of the terms of the
Purchase Agreement or the Mortgage. If any transferee of any Holder shall
acquire Registrable Securities, in any manner, whether by operation of law or
otherwise, such Registrable Securities shall be held subject to all of the terms
of this Agreement, and by taking and holding such Registrable Securities such
person shall be conclusively deemed to have agreed to be bound by and to perform
all of the terms and provisions of this Agreement, including the restrictions on
resale set forth in this Agreement and, if applicable, the Purchase Agreement,
and such person shall be entitled to receive the benefits hereof.
5.6 Third Party Beneficiaries. The Initial Purchasers (even if the Initial
Purchasers are not Holders of Registrable Securities) shall be third party
beneficiaries to the agreements made hereunder between the Company, on the one
hand, and the Holders, on the other hand, and shall have the right to enforce
such agreements directly to the extent they deem such enforcement necessary or
advisable to protect their rights or the rights of Holders hereunder. Each
Holder of Registrable Securities shall be a third party beneficiary to the
agreements made hereunder between the Company, on the one hand, and the Initial
Purchasers, on the other hand, and shall have the right to enforce such
agreements directly to the extent it deems such enforcement necessary or
advisable to protect its rights hereunder.
5.7 Specific Enforcement. Without limiting the remedies available to the
Initial Purchasers and the Holders, the Company acknowledges that any failure by
the Company to comply with its obligations under Sections 2.1 through 2.4 hereof
may result in material irreparable injury to the Initial Purchasers or the
Holders for which there is no adequate remedy at law, that it would not be
possible to measure damages for such injuries precisely and that, in the event
of any such failure, the Initial Purchasers or any Holder may obtain such relief
as may be required to specifically enforce the Company's obligations under
Sections 2.1 through 2.4 hereof.
5.8 Restriction on Resales. Until the expiration of two years after the
original issuance of the Securities, the Company will not, and will cause their
"affiliates" (as such term is defined in Rule 144(a)(1) under the ▇▇▇▇ ▇▇▇) not
to, resell any Securities which are "restricted securities" (as such term is
defined under Rule 144(a)(3) under the ▇▇▇▇ ▇▇▇) that have been reacquired by
any of them and shall immediately upon any purchase of any such Securities
submit such Securities to the Trustee for cancellation.
5.9 Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate 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.
5.10 Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
5.11 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAW OF THE
23
STATE OF NEW YORK WITHOUT REGARD TO THE PRINCIPLES OF CONFLICT OF LAWS THEREOF.
5.12 Severability. In the event that any one or more of the provisions
contained herein, or the application thereof in any circumstance, is held
invalid, illegal or unenforceable, the validity, legality and enforceability of
any such provision in every other respect and of the remaining provisions
contained herein shall not be affected or impaired thereby.
24
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first written above.
ILLINOIS POWER COMPANY
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
Title: President and
Chief Executive Officer
Confirmed and accepted as of
the date first above written:
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
-------------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇
Title: Managing Director
CREDIT SUISSE FIRST BOSTON CORPORATION
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇
-------------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇
Title: Managing Director
Exhibit A
Form of Opinion of Counsel
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
Credit Suisse First Boston Corporation
c/o Merrill Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
4 World Financial Center, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
We have acted as counsel for Illinois Power Company, an Illinois
corporation (the "Company"), in connection with the sale by the Company to the
Initial Purchasers (as defined below) of $550,000,000 aggregate principal amount
of Mortgage Bonds, 11.5% Series due 2010 of the Company (the "Securities")
pursuant to the Purchase Agreement dated December 17, 2002 (the "Purchase
Agreement") among the Company and ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated, Credit Suisse First Boston Corporation (collectively, the "Initial
Purchasers") and the filing by the Company of an Exchange Offer Registration
Statement (the "Registration Statement") in connection with an Exchange Offer to
be effected pursuant to the Registration Rights Agreement (the "Registration
Rights Agreement"), dated December 20, 2002 between the Company and the Initial
Purchasers. This opinion is furnished to you pursuant to Section 3(f)(B) of the
Registration Rights Agreement. Unless otherwise defined herein, capitalized
terms used in this opinion that are defined in the Registration Rights Agreement
are used herein as so defined.
We have examined such documents, records and matters of law as we have
deemed necessary for purposes of this opinion. In rendering this opinion, as to
all matters of fact relevant to this opinion, we have assumed the completeness
and accuracy of, and are relying solely upon, the representations and warranties
of the Company set forth in the Purchase Agreement and the statements set forth
in certificates of public officials and officers of the Company, without making
any independent investigation or inquiry with respect to the completeness or
accuracy of such representations, warranties or statements, other than a review
of the certificate of incorporation, by-laws and relevant minute books of the
Company.
Based on and subject to the foregoing, we are of the opinion that:
1. The Exchange Offer Registration Statement and the Prospectus (other than
the financial statements, notes or schedules thereto and other financial data
and supplemental schedules included or incorporated by reference therein or
omitted therefrom and the Form T-1, as to which such counsel need express no
opinion), comply as to form in all material respects with the requirements of
the 1933 Act and the applicable rules and regulations promulgated under the 1933
Act.
2. We have participated in the preparation of the Registration Statement
and the Prospectus and in the course thereof have had discussions with
representatives of the Underwriters, officers and other representatives of the
Company and PriceWaterhouseCoopers LLP, the Company's independent public
accountants, during which the contents of the Registration Statement and the
Prospectus were discussed. We have not, however, independently verified and are
not passing upon, and do not assume any responsibility for, the accuracy,
completeness or fairness of the statements contained in the Registration
Statement and the Prospectus. Based on our participation as described above,
nothing has come to our attention that would lead us to believe that the
Registration Statement (except for financial statements and schedules and other
financial data included therein as to which we make no statement) 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 not misleading
or that the Prospectus or any amendment or supplement thereto (except for
financial statements and schedules and other financial data included therein, as
to which we make no statement), at the time the Prospectus was issued, at the
time any such amended or supplemented Prospectus was issued or at the Closing
Time, included or includes an untrue statement of a material fact or omitted or
omits to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading.
This opinion is being furnished to you solely for your benefit in
connection with the transactions contemplated by the Registration Rights
Agreement, and may not be used for any other purpose or relied upon by any
person other than you. Except with our prior written consent, the opinions
herein expressed are not to be used, circulated, quoted or otherwise referred to
in connection with any transactions other than those contemplated by the
Registration Rights Agreement by or to any other person.
Very truly yours,
