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EXHIBIT 4(u)
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CMS ENERGY CORPORATION
XXXXXXXXX, XXXXXX & XXXXXXXX SECURITIES CORPORATION
as Call Option Holder
THE CHASE MANHATTAN BANK
as Collateral Agent
AND
THE BANK OF NEW YORK,
as Unit Agent and as Attorney-In-Fact
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PLEDGE AGREEMENT
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Dated as of July , 1999
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PLEDGE AGREEMENT
PLEDGE AGREEMENT, dated as of July __, 1999 among CMS Energy
Corporation, a Michigan corporation (the "Company", as such term is more fully
defined in the Master Unit Agreement referred to below), Xxxxxxxxx, Xxxxxx &
Xxxxxxxx Securities Corporation, as Call Option Holder, The Chase Manhattan
Bank, and The Bank of New York, as Unit Agent and as attorney-in-fact of the
Holders from time to time of the Units.
RECITALS
The Company and the Unit Agent are parties to the Master Unit
Agreement, dated as of the date hereof (as the same may be supplemented or
amended from time to time in accordance with the terms thereof, the "Master Unit
Agreement"). The Master Unit Agreement contemplates that the Trust Preferred
Securities, Junior Subordinated Debentures and Treasury Securities that from
time to time underlie the Units be pledged to the Collateral Agent to secure the
obligations of the Holders of Units under the Purchase Contracts and Call
Options that underlie such Units.
Pursuant to the terms of the Principal Agreements and the Unit
Certificates, the Holders from time to time of the Units irrevocably authorize
the Unit Agent, as attorney-in-fact of such Holders, to execute and deliver this
Agreement on behalf of such Holders and to grant the pledge provided hereby of
the Pledged Securities underlying such Units as provided herein and subject to
the terms hereof.
Accordingly, the Company, the Call Option Holder, the Collateral Agent
and the Unit Agent, in its capacity as Unit Agent and as attorney-in-fact of the
Holders from time to time of the Units, agree as follows:
SECTION 1. Definitions. For all purposes of this Agreement, except as
otherwise expressly provided or unless the context otherwise requires:
(a) capitalized terms used herein and not defined are used herein as
defined in the Master Unit Agreement; and
(b) the words "herein", "hereof" and "hereunder" and other words of
similar import refer to this Agreement as a whole and not to any particular
Article, Section or other subdivision.
"Aggregate Consideration Deliverable on Exercise of the Call Options"
has the meaning specified in the Call Option Agreement.
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"Agreement" means this instrument as originally executed or as it may
from time to time be supplemented or amended by one or more agreements
supplemental hereto entered into pursuant to the applicable provisions hereof.
"Applicable Treasury Regulations" means Subpart O-Book-Entry Procedure
of Title 31 of the Code of Federal Regulations (31 CFR Section 306.115 et seq.)
and any other regulations of the United States Treasury Department from time to
time applicable to the transfer or pledge of book-entry Treasury Securities.
"Date of Deemed Receipt" means, with respect to any payment received by
the Collateral Agent, the date of receipt thereof; provided, however, that if
such payment is received on a date which is not a Quarterly Payment Date and is
not either a payment in respect of defaulted distributions or interest on Trust
Preferred Securities or Junior Subordinated Debentures or a payment comprising a
part of the Aggregate Consideration Deliverable on Exercise of the Call Options,
"Date of Deemed Receipt" means, with respect to such payment, the Quarterly
Payment Date next succeeding such date of receipt.
"Present Value" shall have the meaning set forth in Section 5(g).
SECTION 2. The Pledge. The Holders from time to time of the Units
acting through the Unit Agent, as their attorney-in-fact, hereby pledge to the
Collateral Agent (for the benefit of the Company and the Call Option Holder as
their interests may appear), and grant to the Collateral Agent, the Company and
the Call Option Holder (as their interests may appear) a security interest in
all of the right, title and interest of such Holders in and to the Pledged
Securities underlying such Units (and proceeds therefrom), as collateral
security to ensure the performance when due by such Holders of their respective
obligations under the Purchase Contracts and Call Options underlying such Units.
Concurrently with the execution of this Agreement, the initial Holders of the
[first] ____________ Normal Units issued under the Master Unit Agreement, the
Unit Agent and the Collateral Agent are causing ________ Trust Preferred
Securities to be delivered to, and registered in the name of, the Collateral
Agent, and such Trust Preferred Securities will thereupon constitute Pledged
Securities forming a part of such Normal Units. As used in this Section 2, the
term "delivery" shall have the meaning ascribed to it in the Uniform Commercial
Code of the State of New York. [In the event that any or all of the additional
__________ Normal Units that may be issued as a result of an exercise of the
overallotment option of the underwriters under the Underwriting Agreement are
issued pursuant to the Master Unit Agreement at or after the execution of this
Agreement, the initial Holders of such Normal Units, the Unit Agent and the
Collateral Agent shall cause a number of
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Trust Preferred Securities equal to the number of such Normal Units to be
delivered to, and registered in the name of, the Collateral Agent, and such
Trust Preferred Securities will thereupon constitute Pledged Securities forming
a part of such Normal Units.] In addition, the execution hereof by the Unit
Agent and the Collateral Agent shall constitute an acknowledgment by the
Collateral Agent (as securities intermediary or otherwise) of the Pledge and of
its holding of such Trust Preferred Securities or other Pledged Securities
substituted therefor in accordance with the provisions hereof subject to the
Pledge and of its crediting such Trust Preferred Securities or other Pledged
Securities to a separate account for purposes of perfecting the Pledge under
applicable law, including, to the extent applicable, the Uniform Commercial
Code as adopted and in effect in any applicable jurisdiction and the Applicable
Treasury Regulations. Subject to the Pledge, the Holders from time to time of
the Units shall have full beneficial ownership of the Pledged Securities
underlying such Units, and shall be entitled (directly or through the Collateral
Agent) to all of the rights provided by such Pledged Securities, and the Company
and the Call Option Holder shall have no rights with respect to such Pledged
Securities other than their respective security interests therein.
SECTION 3. Payments in Respect of the Pledged Securities. Any payment
received by the Collateral Agent in respect of the Pledged Securities underlying
any Normal Units or Stripped Units shall be paid by the Collateral Agent, by
wire transfer in same day funds no later than 1:00 p.m., New York City time, on
the Date of Deemed Receipt (or, if the Date of Deemed Receipt is not a Business
Day or if such payment is received by the Collateral Agent after noon, New York
City time, on the Date of Deemed Receipt, then such payment shall be made by the
Collateral Agent no later than 10:00 a.m., New York City time, on the next
succeeding Business Day), as follows:
(a) in the case of payments not scheduled to fall on and that are not
in respect of amounts due on the Stock Purchase Date, (i) first, to the Company,
to the account designated by it for such purpose, in an amount equal to the
Contract Fees, if any, then payable to the Company in respect of such Units, and
(ii) second, to the extent of any amount remaining after the payment (if any)
referred to in clause (i) above, to the Unit Agent, to the account designated by
it for payments in respect of Normal Units or the account designated by it for
payments in respect of Stripped Units, as the case may be; and
(b) in the case of payments scheduled to fall on or that are in respect
of amounts due on the Stock Purchase Date, (i) with respect to payments received
in respect of Units which are Paid Units (as specified in the notice from the
Unit Agent
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referred to in Section 4), to the Unit Agent, to the account designated by it
for payments in respect of Paid Units which are Normal Units or the account
designated by it for payments in respect of Paid Units which are Stripped Units,
as the case may be; and (ii) with respect to payments received in respect of
Units which are Unpaid Units (as specified in the notice from the Unit Agent
referred to in Section 4), to the Unit Agent, to the account designated by it
for payments in respect of Unpaid Units which are Normal Units; provided,
however, that if the Company disputes the notice from the Unit Agent referred to
in Section 4 and notifies the Collateral Agent, prior to noon, New York City
time, on the Stock Purchase Date, that the number of Paid Units or the number of
Unpaid Units (or both) is different than that indicated in such notice, the
foregoing payments with respect to any Paid Units or Unpaid Units subject to
dispute shall not be paid until such dispute is resolved.
All payments received by the Unit Agent as provided herein shall be
applied by the Unit Agent pursuant to the provisions of the Master Unit
Agreement.
SECTION 4. Notice with Respect to Numbers of Paid Units and Unpaid
Units; Exercise of Junior Subordinated Debenture Put Options with Respect to
Unpaid Units. By 11:00 a.m., New York City time, on the Stock Purchase Date, the
Unit Agent shall, as provided in the Master Unit Agreement, notify the Company
and the Collateral Agent as to the number of Normal Units and the number of
Stripped Units, respectively, which are Paid Units and the number of Normal
Units and the number of Stripped Units, respectively, which are Unpaid Units.
Promptly after receiving such notification, (a) if Trust Preferred Securities
underlie the Unpaid Units of any Holder, the Collateral Agent, on behalf of such
Holder, shall exercise such Holder's right under the Declaration to require the
Trust to distribute Junior Subordinated Debentures having an aggregate principal
amount equal to the aggregate liquidation amount of such Trust Preferred
Securities, in exchange for such Trust Preferred Securities, and, upon receiving
such Junior Subordinated Debentures, shall thereupon, as Put Agent, exercise the
Junior Subordinated Debenture Put Option with respect thereto and (b) if Junior
Subordinated Debentures underlie such Unpaid Units, the Collateral Agent, on
behalf of such Holder, shall, as Put Agent, exercise the Junior Subordinated
Debenture Put Option with respect thereto. The payment received by the
Collateral Agent from the exercise of any Junior Subordinated Debenture Put
Option shall then be applied by the Collateral Agent in accordance with Section
3(b).
SECTION 5. Release and Substitution of Pledged Securities. (a) Upon
notice to the Collateral Agent by the Company or the Unit Agent that there has
occurred a Termination Event, the Collateral Agent shall release all Pledged
Securities from the Pledge and shall transfer, without recourse, such released
Pledged Securities, free and
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clear of any lien, pledge or security interest created hereby, to the Unit Agent
for delivery by the Unit Agent pursuant to the provisions of the Master Unit
Agreement.
(a) Upon notice to the Collateral Agent by the Call Option Holder that
the Call Option Holder is exercising the Call Options in accordance with the
terms of the Call Option Agreement with respect to the Trust Preferred
Securities or Junior Subordinated Debentures underlying the Normal Units,
provided that the Collateral Agent receives the requisite Aggregate
Consideration Deliverable on Exercise of the Call Options on the Call Settlement
Date specified in such notice, the Collateral Agent shall release such Trust
Preferred Securities or Junior Subordinated Debentures from the Pledge and
transfer, without recourse, such released Trust Preferred Securities or Junior
Subordinated Debentures, free and clear of any lien, pledge or security interest
created hereby, to the Call Option Holder or its designee as specified in such
notice, whereupon (i) the Treasury Securities constituting all or a part of the
Aggregate Consideration Deliverable On Exercise of the Call Options so received
by the Collateral Agent shall be subject to the Pledge with respect to the
Normal Units and (ii) the Pledge shall cease to constitute a security interest
for the benefit of the Call Option Holder.
(b) In connection with a Stripped Unit Creation, upon request by the
Unit Agent to the Collateral Agent to release the then Pledged Securities
underlying the number of Normal Units indicated in such request, provided that
the Collateral Agent has received (i) the Treasury Securities and cash required
by Section 309(a)(i) of the Master Unit Agreement for a Stripped Unit Creation
relating to such Normal Units and (ii) if the Call Options underlying such
Normal Units remain exercisable on the date of receipt of such instruction, an
instrument from the Call Option Holder releasing its security interest in the
Pledged Securities underlying such Normal Units and agreeing that such Call
Options no longer underlie such Normal Units (or the Stripped Units, they
become), the Collateral Agent shall release such Pledged Securities from the
Pledge and transfer, without recourse, such released Pledged Securities, free
and clear of any lien, pledge or security interest created hereby, to the Unit
Agent for delivery by the Unit Agent pursuant to the provisions of the Master
Unit Agreement, whereupon the Treasury Securities so received by the Collateral
Agent in connection with such Stripped Unit Creation shall be subject to the
Pledge and constitute the Pledged Securities underlying the Stripped Units so
created.
(c) In connection with the delivery to the Collateral Agent of Treasury
Securities and cash pursuant to Section 5(b) or (c), such delivery shall be by
Federal Reserve Bank-Wire to the account of the Collateral Agent designated by
it for such purpose, and the Collateral Agent and the Call Option Holder or
transferring Holder
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of Normal Units, as the case may be, shall take appropriate action (i) so that
the applicable Federal Reserve Bank through which such Treasury Securities have
been purchased will reflect such transfer and the Pledge of such Treasury
Securities in accordance with Applicable Treasury Regulations and (ii) as may be
required to perfect the Pledge under Applicable Treasury Regulations.
(d) In the event the Trust is dissolved while any Trust Preferred
Securities are Pledged Securities underlying Normal Units, the Junior
Subordinated Debentures issued upon dissolution thereof shall be delivered to
the Collateral Agent in exchange for such Trust Preferred Securities, whereupon
such Trust Preferred Securities shall cease to constitute Pledged Securities and
the Junior Subordinated Debentures so received by the Collateral Agent shall be
subject to the Pledge and constitute the Pledged Securities underlying such
Normal Units.
(e) On the Stock Purchase Date, the Collateral Agent shall release the
Trust Preferred Securities or Junior Subordinated Debentures underlying Units
which are Paid Units (as specified in the notice from the Unit Agent referred to
in Section 4) from the Pledge and transfer, without recourse, such released
Trust Preferred Securities or Junior Subordinated Debentures, free and clear of
any lien, pledge or security interest created hereby, to the Unit Agent for
delivery pursuant to the provisions of the Master Unit Agreement; provided,
however, that if the Company disputes the notice from the Unit Agent referred to
in Section 4 and notifies the Collateral Agent, prior to noon, New York City
time, on the Stock Purchase Date, that the number of Paid Units is different
from that indicated in such notice, the foregoing release with respect to any
Paid Units subject to dispute shall not be made until such dispute is resolved.
(f) The Call Option Holder will deliver to a holder wishing to create a
Stripped Unit the instrument referred to in Section 5 (c) (ii) upon the receipt
of cash from such holder in an amount equal to the Present Value of each Call
Option, at such time, relating to such Trust Preferred Security that the holder
wishes to have released.
"PRESENT VALUE" means, with respect to each Call Option
relating to the Trust Preferred Securities which the holder of Normal Units
seeks to replace with Treasury Securities, the present value of 0.60% of the
Stated Amount on the Substitution Date of such Call Option, which shall be
computed using a discount rate equal to the Treasury Rate. For purposes of this
definition, the Present Value of the Call Option will be determined in good
faith by the Call Option Holder in accordance with generally accepted principles
of financial analysis.
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"TREASURY RATE" means the bond equivalent yield on United
States Treasury notes or bills having a term interest nearest in length to the
length of the period from the Substitution Date to the Call Option Expiration
Date.
"SUBSTITUTION DATE" means the date on which a holder of Normal
Units exercises its right to substitute Treasury Securities for Pledged
Securities.
SECTION 6. Rights and Remedies. (a) The Collateral Agent shall have all
of the rights and remedies with respect to the Pledged Securities of a secured
party under the Uniform Commercial Code as in effect in the State of New York
(the "Code") (whether or not said Code is in effect in the jurisdiction where
the rights and remedies are asserted) and, with respect to Pledged Securities
which are Treasury Securities, the Applicable Treasury Regulations, and such
additional rights and remedies to which a secured party is entitled under the
laws in effect in any jurisdiction where any rights and remedies hereunder may
be asserted.
(a) Without limiting any rights or powers otherwise granted by this
Agreement to the Collateral Agent, in the event the Collateral Agent is unable
to make payments due to the Company pursuant to the Purchase Contracts
underlying any Units, the Collateral Agent shall have and may exercise, with
reference to the Pledged Securities underlying such Units and the obligations of
the Holders of such Units, any and all of the rights and remedies available to a
secured party under the Code and the Applicable Treasury Regulations after
default by a debtor, and as otherwise granted herein or under any other law.
(b) Without limiting any rights or powers otherwise granted by this
Agreement to the Collateral Agent, the Collateral Agent is hereby irrevocably
authorized to receive and collect all payments of principal of or distributions
or interest on the Pledged Securities, in each case subject to the provisions
hereof.
(c) The Unit Agent, the Call Option Holder and each Holder of Units
agree that, from time to time, upon the written request of the Collateral Agent,
the Unit Agent, the Call Option Holder or such Holder of Units shall execute and
deliver such further documents and do such other acts and things as the
Collateral Agent may reasonably request in order to maintain the Pledge, and the
perfection and priority thereof, and to confirm the rights of the Collateral
Agent hereunder.
SECTION 7. The Collateral Agent. The Collateral Agent, the Company and
the Call Option Holder hereby agree among themselves as follows (it being under-
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stood and agreed that, except as provided in Section 7.08, neither the Unit
Agent nor any Holder of Units shall have any rights or duties under this Section
7):
7.1 Appointment, Powers and Immunities. The Collateral Agent shall act
hereunder as agent for the Company and the Call Option Holder, with such powers
as are specifically vested in the Collateral Agent by the terms of this
Agreement, together with such other powers as are reasonably incidental thereto.
The Collateral Agent: (a) shall have no duties or responsibilities except those
expressly set forth in this Agreement and no implied covenants or obligations
shall be inferred from this Agreement against the Collateral Agent, nor shall
the Collateral Agent be bound by the provisions of any agreement by any party
hereto beyond the specific terms hereof; (b) shall not be responsible to the
Company or the Call Option Holder for any recitals contained in this Agreement,
or in any certificate or other document referred to or provided for in, or
received by it under, this Agreement, the Units, the Master Unit Agreement, or
the Call Option Agreement or for the value, validity, effective ness,
genuineness, enforceability or sufficiency of this Agreement (other than as
against the Collateral Agent), the Units, the Master Unit Agreement or the Call
Option Agreement or any other document referred to or provided for herein or
therein or for any failure by the Company, the Call Option Holder, or any other
Person (except the Collateral Agent) to perform any of its obligations hereunder
or thereunder; (c) shall not be required to initiate or conduct any litigation
or collection proceedings hereunder (except pursuant to directions furnished
under Section 7.2 hereof); (d) shall not be responsible for any action taken or
omitted to be taken by it hereunder or under any other document or instrument
referred to or provided for herein or in connection herewith or therewith,
except for its own negligence; and (e) shall not be required to advise any party
as to selling or retaining, or taking or refraining from taking any action with
respect to, any Units or any property deposited hereunder. Subject to the
foregoing, during the term of this Agreement the Collateral Agent shall take all
reasonable action in connection with the safekeeping and preservation of the
Pledged Securities hereunder.
No provision of this Agreement shall require the Collateral Agent to expend or
risk its own funds or otherwise incur any financial liability in the performance
of any of its duties hereunder. In no event shall the Collateral Agent be liable
for any amount in excess of the value of the Pledged Securities.
7.2 Instructions of the Company. The Company (or, with respect to
matters relating to the Call Options, the Call Option Holder) shall have the
right, by one or more instruments in writing executed and delivered to the
Collateral Agent, to direct the time, method and place of conducting any
proceeding for any right or remedy
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available to the Collateral Agent, or of exercising any power conferred on the
Collateral Agent, or to direct the taking or refraining from taking of any
action authorized by this Agreement; provided, however, that (a) no Company
direction shall in any way adversely affect the rights of the Call Option Holder
hereunder or under the Call Options and no Call Option Holder direction shall in
any way adversely affect the rights of the Company hereunder or under the
Purchase Contracts, (b) such direction shall not conflict with the provisions of
any law or of this Agreement and (c) the Collateral Agent shall be adequately
indemnified as provided herein. Nothing in this Section 7.2 shall impair the
right of the Collateral Agent in its discretion to take any action or omit to
take any action which it deems proper and which is not inconsistent with such
direction.
7.3 Reliance by Collateral Agent. The Collateral Agent shall be
entitled to rely upon any certification, order, judgment, opinion, notice or
other communication (including, without limitation, any thereof by telephone,
telecopy, telex, telegram or cable) believed by it to be genuine and correct and
to have been signed or sent by or on behalf of the proper Person or Persons
(without being required to determine the correctness of any fact stated
therein), and upon advice and statements of legal counsel and other experts
selected by the Collateral Agent. As to any matters not expressly provided for
by this Agreement, the Collateral Agent shall in all cases be fully protected in
acting, or in refraining from acting, hereunder in accordance with instructions
given by the Company or the Call Option Holder, as the case may be, in
accordance with this Agreement.
7.4 Rights in Other Capacities. The Collateral Agent and its
affiliates may (without having to account therefor to the Company or the Call
Option Holder) accept deposits from, lend money to, make investments in and
generally engage in any kind of banking, trust or other business with the Unit
Agent and any Holder of Units as if it were not acting as the Collateral Agent,
and the Collateral Agent and its affiliates may accept fees and other
consideration from the Unit Agent and any Holder of Units without having to
account for the same to the Company or the Call Option Holder, provided that the
Collateral Agent covenants and agrees with the Company and the Call Option
Holder that the Collateral Agent shall not accept, receive or permit there to be
created in its favor any security interest, lien or other encumbrance of any
kind in or upon the Pledged Securities.
7.5 Non-Reliance on Collateral Agent. The Collateral Agent shall not be
required to keep itself informed as to the performance or observance by the Unit
Agent or any Holder of Units of this Agreement, the Master Unit Agreement, the
Call Option Agreement, the Units or any other document referred to or provided
for
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herein or therein or to inspect the properties or books of the Unit Agent or
any Holder of Units. The Collateral Agent shall not have any duty or
responsibility to provide the Company or the Call Option Holder with any credit
or other information concerning the affairs, financial condition or business of
the Unit Agent or any Holder of Units that may come into the possession of the
Collateral Agent or any of its affiliates.
7.6 Compensation and Indemnity. The Company agrees: (a) to pay the
Collateral Agent from time to time reasonable compensation for all services
rendered by it hereunder and (b) to indemnify the Collateral Agent for, and to
hold it harmless against, any loss, liability or expense including taxes (other
than taxes based upon, measured by or determined by the income of the Collateral
Agent) incurred without negligence or bad faith on its part, arising out of or
in connection with the acceptance or administration of its powers and duties
under this Agreement, including the costs and expenses of defending itself
against any claim or liability in connection with the exercise or performance of
such powers and duties.
7.7 Failure to Act. In the event of any ambiguity in the provisions of
this Agreement or any dispute between or conflicting claims by or among the
under signed and/or any other person or entity with respect to any funds or
property deposited hereunder, the Collateral Agent shall be entitled, at its
sole option, to refuse to comply with any and all claims, demands or
instructions with respect to such property or funds so long as such dispute or
conflict shall continue, and the Collateral Agent shall not be or become liable
in any way to any of the undersigned for its failure or refusal to comply with
such conflicting claims, demands or instructions. The Collateral Agent shall be
entitled to refuse to act until either (a) such conflicting or adverse claims or
demands shall have been finally determined by a court of competent jurisdiction
or settled by agreement between the conflicting parties as evidenced in a
writing satisfactory to the Collateral Agent or (b) the Collateral Agent shall
have received security or an indemnity satisfactory to the Collateral Agent
sufficient to save the Collateral Agent harmless from and against any and all
loss, liability or expense which the Collateral Agent may incur by reason of its
acting. The Collateral Agent may in addition elect to commence an interpleader
action or seek other judicial relief or orders as the Collateral Agent may deem
necessary. Notwithstanding anything contained herein to the contrary, the
Collateral Agent shall not be required to take any action that is in its opinion
contrary to law or to the terms of this Agreement, or which would in its opinion
subject it or any of its officers, employees or directors to liability.
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7.8 Resignation of Collateral Agent. Subject to the appointment and
acceptance of a successor Collateral Agent as provided below, (a) the
Collateral Agent may resign at any time by giving notice thereof to the Company,
the Unit Agent and, if the Call Options are exercisable or have been exercised
but not settled, the Call Option Holder, (b) the Collateral Agent may be removed
at any time by the Company (provided, that, if the Call Options are exercisable
or have been exercised but not settled, the Call Option Holder shall have
consented to such removal), and (c) if the Collateral Agent fails to perform any
of its material obligations hereunder in any material respect for a period of
not less than 20 days after receiving notice of such failure by the Unit Agent
and such failure shall be continuing, the Collateral Agent may be removed by the
Unit Agent. The Unit Agent shall promptly notify the Company and, if the Call
Options are exercisable or have been exercised but not settled, the Call Option
Holder of any removal of the Collateral Agent pursuant to clause (c) of the
immediately preceding sentence. Upon any such resignation or removal, the
Company and, if the Call Options are exercisable or have been exercised but not
settled, the Call Option Holder shall have the right to appoint a successor
Collateral Agent. If no successor Collateral Agent shall have been so appointed
and shall have accepted such appointment within 30 days after the retiring
Collateral Agent's giving of notice of resignation or such removal, then the
retiring Collateral Agent may petition any court of competent jurisdiction for
the appointment of a successor Collateral Agent. The Collateral Agent shall be a
bank which has an office in New York, New York with a combined capital and
surplus of at least $50,000,000. Upon the acceptance of any appointment as
Collateral Agent hereunder by a successor Collateral Agent, such successor
Collateral Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Collateral Agent, and
the retiring Collateral Agent shall take all appropriate action to transfer any
money and property held by it hereunder (including the Pledged Securities) to
such successor Collateral Agent. The retiring Collateral Agent shall, upon such
succession, be discharged from its duties and obligations as Collateral Agent
hereunder. After any retiring Collateral Agent's resignation hereunder as
Collateral Agent, the provisions of this Section 7 shall continue in effect for
its benefit in respect of any actions taken or omitted to be taken by it while
it was acting as the Collateral Agent.
7.9 Right to Appoint Agent or Advisor. The Collateral Agent shall have
the right to appoint agents or advisors in connection with any of its duties
hereunder, and the Collateral Agent shall not be liable for any action taken or
omitted by such agents or advisors selected in good faith.
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The provisions of this Section 7 shall survive termination of this
Agreement and the resignation or removal of the Collateral Agent.
SECTION 8. Miscellaneous.
8.1 Amendments. This Agreement may be amended in the manner set forth
in Section 801 of the Master Unit Agreement for supplemental agreements. In
executing any amendment permitted by this Section, the Collateral Agent shall be
entitled to receive and (subject to Section 7.1 hereof) shall be fully protected
in relying upon, an Opinion of Counsel stating that the execution of such
amendment is authorized or permitted by this Agreement and is for a purpose set
forth in Section 801 of the Master Unit Agreement.
8.2 No Waiver. No failure on the part of the Collateral Agent or any of
its agents to exercise, and no course of dealing with respect to, and no delay
in exercising, any right, power or remedy hereunder shall operate as a waiver
thereof; nor shall any single or partial exercise by the Collateral Agent or any
of its agents of any right, power or remedy hereunder preclude any other or
further exercise thereof or the exercise of any other right, power or remedy.
The remedies herein are cumulative and are not exclusive of any remedies
provided by law.
8.3 Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO
CONFLICTS OF LAWS PRINCIPLES THEREOF. The Company, the Call Option Holder, the
Collateral Agent and the Holders from time to time of the Units, acting through
the Unit Agent as their attorney-in-fact, hereby submit to the nonexclusive
jurisdiction of the United States District Court for the Southern District of
New York and of any New York state court sitting in New York City for the
purposes of all legal proceedings arising out of or relating to this Agreement
or the transactions contemplated hereby. The Company, the Call Option Holder,
the Collateral Agent and the Holders from time to time of the Units, acting
through the Unit Agent as their attorney-in-fact, irrevocably waive, to the
fullest extent permitted by applicable law, any objection which they may now or
hereafter have to the laying of the venue of any such proceeding brought in such
a court and any claim that any such proceeding brought in such a court has been
brought in an inconvenient forum.
8.4 Legal Holidays. In any case where any Quarterly Payment Date or the
Stock Purchase Date shall not be a Business Day, then (notwithstanding any other
provision of this Agreement or of the Units) the actions required by this
Agreement to
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occur on such date shall not occur on such date, but instead shall occur on the
next succeeding Business Day with the same force and effect as if they had
occurred on such Quarterly Payment Date or Stock Purchase Date, as the case may
be; except that if such next succeeding Business Day is in the next calendar
year, such actions shall occur on the immediately preceding Business Day with
the same force and effect as if made on such Quarterly Payment Date or Stock
Purchase Date.
8.5 Notices. All notices, requests, consents and other communications
provided for herein (including, without limitation, any modifications of, or
waivers or consents under, this Agreement) shall be given or made in writing
(including, without limitation, by telecopy) delivered to the intended recipient
at the "Address for Notices" specified below its name on the signature pages
hereof or, as to any party, at such other address as shall be designated by such
party in a notice to the other parties. Except as otherwise provided in this
Agreement, all such communications shall be deemed to have been duly given when
transmitted by telecopier or personally delivered or, in the case of a mailed
notice, upon receipt, in each case given or addressed as aforesaid.
8.6 Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of the respective successors and assigns of the Company,
the Call Option Holder, the Collateral Agent and the Unit Agent, and the Holders
from time to time of the Units, by their acceptance of the same, shall be deemed
to have agreed to be bound by the provisions hereof and to have ratified the
agreements of, and the grant of the Pledge hereunder by, the Unit Agent, as
their attorney-in-fact.
8.7 Counterparts. This Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one and the same
instrument, and any of the parties hereto may execute this Agreement by signing
any such counterpart.
8.8 Severability. If any provision hereof is invalid or unenforceable
in any jurisdiction, then, to the fullest extent permitted by law, (a) the other
provisions hereof shall remain in full force and effect in such jurisdiction and
shall be liberally construed in order to carry out the intentions of the parties
hereto as nearly as may be possible and (b) the invalidity or unenforceability
of any provision hereof in any jurisdiction shall not affect the validity or
enforceability of such provision in any other jurisdiction.
8.9 Expenses, etc. The Company agrees to reimburse the Collateral Agent
for: (a) all reasonable out-of-pocket costs and expenses of the Collateral Agent
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(including, without limitation, the reasonable fees and expenses of counsel to
the Collateral Agent), in connection with (i) the negotiation, preparation,
execution and delivery or performance of this Agreement and (ii) any
modification, supplement or waiver of any of the terms of this Agreement; (b)
all reasonable costs and expenses of the Collateral Agent (including, without
limitation, reasonable fees and expenses of counsel) in connection with (i) any
enforcement or proceedings resulting or incurred in connection with causing any
Holder of Units to satisfy its obligations under the Purchase Contracts or Call
Options forming a part of the Units and (ii) the enforcement of this Section
8.9; and (c) all transfer, stamp, documentary or other similar taxes,
assessments or charges levied by any governmental or revenue authority in
respect of this Agreement or any other document referred to herein and all
costs, expenses, taxes, assessments and other charges incurred in connection
with any filing, registration, recording or perfection of any security interest
contemplated hereby.
8.10 Security Interest Absolute. All rights of the Collateral Agent and
security interests hereunder, and all obligations of the Holders from time to
time of the Units here under, shall be absolute and unconditional irrespective
of:
(a) any lack of validity or enforceability of any provision of the
Units or any other agreement or instrument relating thereto;
(b) any change in the time, manner or place of payment of, or any other
term of, or any increase in the amount of, all or any of the obligations of
Holders of Units under the related Purchase Contracts or Call Options or any
other amendment or waiver of any term of, or any consent to any departure from
any requirement of, the Master Unit Agreement or any Units or any other
agreement or instrument relating thereto; or
(c) any other circumstance which might otherwise constitute a defense
available to, or discharge of, a borrower, a guarantor or a pledgor.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the day and year first above written.
CMS ENERGY CORPORATION
By:
--------------------------------
Name:
Title:
Address for Notices:
Xxxxxxxx Xxxxx Xxxxx, Xxxxx 0000
000 Xxxx Xxxxxx Xxxxx
Xxxxxxxx, Xxxxxxxx 00000
Attention: General Counsel
Telecopy:
XXXXXXXXX, XXXXXX & XXXXXXXX
SECURITIES CORPORATION,
as Call Option Holder
-----------------------------------
(Xxxxxxxxx, Lufkin & Xxxxxxxx
Securities Corporation)
Address for Notices:
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Registration Department
CHASE MANHATTAN BANK,
as Collateral Agent
By:
--------------------------------
Name:
Title:
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Address for Notices:
-----------------------------------
-----------------------------------
Telecopy:
-----------------------------------
Attention:
-----------------------------------
THE BANK OF NEW YORK,
as Unit Agent and as attorney-in-
fact of the Holders from time to
time of the Units
By:
--------------------------------
Name:
Title:
Address for Notices:
-----------------------------------
-----------------------------------
Attention:
------------------------
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