Exhibit 4.6
, dated as of March __, 2001 (the "Agreement") by
and between Duke Energy Corporation a North Carolina corporation (the
"Company"), Duke Capital corporation, a Delaware corporation and wholly owned
subsidiary of the Company ("Duke Capital") The Chase Manhattan Bank, a New York
banking corporation, not individually but solely as Purchase Contract Agent (the
"Purchase Contract Agent") and as attorney-in-fact of the holders of Purchase
Contracts (as defined in the Purchase Contract Agreement (as defined herein)),
and Xxxxxx Xxxxxxx & Co. Incorporated (the "Remarketing Agent").
WITNESSETH:
WHEREAS, the Company will issue $500,000,000 (or $575,000,000 if the
Underwriters' (as defined in the Underwriting Agreement) overallotment option is
exercised in full) aggregate Stated Amount of its Equity Units (the "Equity
Units") under the Purchase Contract Agreement, dated as of March ___, 2001, by
and between the Purchase Contract Agent and the Company (the "Purchase Contract
Agreement"); and
WHEREAS, the Equity Units will initially consist of 20,000,000 (or
23,000,000 if the Underwriters' overallotment option is exercised in full) units
referred to as "Corporate Units;" and
WHEREAS, Duke Capital will issue concurrently in connection with the
issuance of the Equity Units $500,000,000 (or $575,000,000 if the Underwriters'
overallotment option is exercised in full) aggregate principal amount of ___%
Senior Notes due 2006 (the "Senior Notes") of the Company; and
WHEREAS, the Senior Notes forming a part of the Corporate Units will
be pledged pursuant to the Pledge Agreement (the "Pledge Agreement"), dated as
of March __, 2001, by and among the Company, Bank One Trust Company, N.A., as
collateral agent (the "Collateral Agent") and the Purchase Contract Agent, to
secure a Corporate Units holder's obligations under the related Purchase
Contract on the Purchase Contract Settlement Date; and
WHEREAS, the Senior Notes of the Senior Noteholders electing to have
their Senior Notes remarketed and of the Corporate Unit holders will be re-
marketed by the Remarketing Agent on the third Business Day immediately preced-
ing __________, 2004 (the "Initial Remarketing Date"); and
WHEREAS, in the event of a Failed Initial Remarketing, the Senior
Notes of the Senior Noteholders electing to have their Senior Notes remarketed
and of the Corporate Unit holders who have elected not to settle the Purchase
Contracts related to their Corporate Units by Cash Settlement and who have not
early settled their Purchase Contracts will be remarketed by the Remarketing
Agent on the third Business Day immediately preceding the Purchase Contract
Settlement Date; and
WHEREAS, in the event of a Successful Initial Remarketing, the
applicable interest rate on the Senior Notes will be reset on the Initial
Remarketing Date, to the Reset Rate to be determined by the Reset Agent as the
rate that such Senior Notes should bear in order for the Applicable Principal
Amount of the Senior Notes to have an approximate aggregate market value of
100.5% of the Treasury Portfolio Purchase Price on the Initial Remarketing Date,
provided that in the determination of such Reset Rate, the Company and Duke
Capital shall, if applicable, limit the Reset Rate to the maximum rate permitted
by applicable law; and
WHEREAS, in the event of a Failed Initial Remarketing, the applicable
interest rate on the Senior Notes that remain outstanding on and after the
Purchase Contract Settlement Date will be reset on the third Business Day
immediately preceding the Purchase Contract Settlement Date, to the Reset Rate
to be determined by the Reset Agent as the rate that such Senior Notes should
bear in order to have an approximate market value of 100.5% of the aggregate
principal amount of the Senior Notes on the third Business Day immediately
preceding the Purchase Contract Settlement Date, provided that in the
determination of such Reset Rate, the Company and Duke Capital shall, if
applicable, limit the Reset Rate to the maximum rate permitted by applicable
law; and
WHEREAS, the Company and Duke Capital have requested Xxxxxx Xxxxxxx &
Co. Incorporated ("Xxxxxx Xxxxxxx") to act as the Reset Agent and as the
Remarketing Agent, and as such to perform the services described herein; and
WHEREAS, Xxxxxx Xxxxxxx is willing to act as Reset Agent and
Remarketing Agent and as such to perform such duties on the terms and conditions
expressly set forth herein;
2
NOW, THEREFORE, for and in consideration of the covenants herein made,
and subject to the conditions herein set forth, the parties hereto agree as
follows:
Section 1. Definitions. Capitalized terms used and not defined in
-----------
this Agreement, in the recitals hereto or in the paragraph preceding such
recitals shall have the meanings assigned to them in the Purchase Contract
Agreement or, if not therein defined, the Pledge Agreement.
Section 2. Appointment and Obligations of Remarketing Agent.
------------------------------------------------
(a) The Company and Duke Capital hereby appoint Xxxxxx Xxxxxxx and Xxxxxx
Xxxxxxx hereby accepts such appointment, (i) as the Reset Agent to deter mine in
consultation with the Company and Duke Capital, in the manner provided for
herein and in the Third Supplemental Indenture (as in effect on the date of this
or as amended, provided that any such amendment does not
render such indenture inconsistent with the or any Supple
mental (as defined below) in respect of the remarketing
procedures or adversely affect the Remarketing Agent's rights, unless such
amendment is effected with the prior written consent of the Remarketing Agent)
with respect to the Senior Notes, (1) the Reset Rate that, in the opinion of the
Reset Agent, will, when applied to the Senior Notes, enable the Applicable
Principal Amount of the Senior Notes to have an approximate aggregate market
value of 100.5% of the Treasury Portfolio Purchase Price as of the Initial
Remarketing Date, and (2) in the event of a Failed Initial Remarketing, the
Reset Rate that, in the opinion of the Reset Agent, will, when applied to the
Senior Notes, enable a Senior Note to have an approximate market value of 100.5%
of its principal amount as of the third Business Day preceding the Purchase
Contract Settlement Date, provided, in each case, that the Company and Duke
Capital, by notice to the Reset Agent prior to the tenth Business Day preceding
_____, 2004, in the case of the Initial Remarketing (as defined below), or the
Purchase Contract Settlement Date, in the case of the Secondary Remarketing (as
defined below), shall, if applicable, limit the Reset Rate so that it does not
exceed the maximum rate permitted by applicable law) and (ii) as the exclusive
Remarketing Agent (subject to the right of Xxxxxx Xxxxxxx to appoint additional
remarketing agents hereunder as described below) to (1) remarket the Senior
Notes of the Senior Noteholders electing to have their Senior Notes remarketed
and of the Corporate Units holders on the Initial Remarketing Date, for
settlement on ____________, 2004 and (2) in the case of a Failed Initial
Remarketing, remarket the Senior Notes of the Senior Noteholders electing to
have their Senior Notes remarketed or of the Corporate Units holders who have
not early
3
settled the related Purchase Contracts and have failed to notify the Purchase
Contract Agent, on or prior to the fifth Business Day immediately preceding the
Purchase Contract Settlement Date, of their intention to settle the related
Purchase Contracts through Cash Settlement. In connection with the remarketing
contemplated hereby, the Remarketing Agent will enter into a Supplemental
(the "Supplemental ") with the
Company, Duke Capital and the Purchase Contract Agent, which shall either be (i)
substantially in the form attached hereto as Exhibit A (with such changes as the
Company, Duke Capital and the Remarketing Agent may agree upon, it being
understood that changes may be necessary in the provisions of the Supplemental
due to changes in law or facts and circumstances or in the
event that Xxxxxx Xxxxxxx is not the sole remarketing agent, and with such
further changes therein as the Remarketing Agent may reasonably request), or
(ii) in such other form as the Remarketing Agent may reasonably request, subject
to the approval of the Company and Duke Capital (such approval not to be
unreasonably withheld). Anything herein to the contrary notwithstanding, to the
extent that the parties hereto are unable to agree on the form or substance of
the Supplemental , Xxxxxx Xxxxxxx shall not act as
Remarketing Agent or Reset Agent hereunder. The Company and Duke Capital agree
that Xxxxxx Xxxxxxx shall have the right, on 15 Business Days notice to the
Company and Duke Capital, to appoint one or more additional remarketing agents
so long as any such additional remarketing agents shall be reasonably acceptable
to the Company and Duke Capital. Upon any such appointment, the parties shall
enter into an appropriate amendment to this Agreement to reflect the addition of
any such remarketing agent.
(b) Pursuant to the Supplemental , the
Remarketing Agent, either as sole remarketing agent or as representative of a
group of remarketing agents appointed as aforesaid, will agree, subject to the
terms and conditions set forth herein and therein, to use its reasonable efforts
to (i) remarket, on the Initial Remarketing Date, the Senior Notes that the
Purchase Contract Agent and the Custodial Agent shall have notified the
Remarketing Agent have been tendered for, or otherwise are to be included in,
the Initial Remarketing, at a price per Senior Note such that the aggregate
price for the Applicable Principal Amount of the Senior Notes is approximately
100.5% of the Treasury Portfolio Purchase Price and (ii) in the event of a
Failed Initial Remarketing, remarket, on the third Business Day immediately
preceding the Purchase Contract Settlement Date, the Senior Notes that the
Purchase Contract Agent and the Custodial Agent shall have notified the
Remarketing Agent have been tendered for, or otherwise are to be included in,
the Secondary Remarketing, at a price of approximately 100.5% of the aggregate
principal amount of such Senior Notes. Notwithstanding the preceding sentence,
the
4
Remarketing Agent shall not remarket any Senior Notes for a price less than the
price (the "Minimum Initial Remarketing Price") necessary for the Applicable
Principal Amount of the Senior Notes to have an aggregate price equal to 100% of
the Treasury Portfolio Purchase Price, in the case of the Initial Remarketing,
or the aggregate principal amount of such Senior Notes, in the case of the
Secondary Remarketing. After deducting the fee specified in Section 3 below, the
proceeds of such Initial Remarketing or Secondary Remarketing, as the case may
be, shall be paid to the Collateral Agent in accordance with Section 4.6 or 6.3
of the Pledge Agreement and Section 5.3A or 5.4 of the Purchase Contract
Agreement (each of which Sections are incorporated herein by reference).
(c) It is understood and agreed that neither the Remarketing Agent
nor the Reset Agent shall have any obligation whatsoever to purchase any Senior
Notes, whether in the Initial Remarketing, Secondary Remarketing or otherwise,
and shall in no way be obligated to provide funds to make payment upon tender of
Senior Notes for remarketing or to otherwise expend or risk their own funds or
incur or be exposed to financial liability in the performance of their
respective duties under this Agreement or the Supplemental Remarketing
Agreement, and, without limitation of the foregoing, the Remarketing Agent shall
not be deemed an underwriter of the remarketed Senior Notes. The Company and
Duke Capital shall not be obligated in any case to provide funds to make payment
upon tender of Senior Notes for remarketing.
(d) The Remarketing Agent agrees to give the notices required by
Sections 301(g) and (h) and 302 (h) and (i) of the Third Supplemental Indenture.
Section 3. Fees. In the event of a Successful Initial Remarketing,
----
the Remarketing Agent shall retain as a remarketing fee (the "Remarketing Fee")
an amount not exceeding 25 basis points (0.25%) of the Minimum Initial
Remarketing Price from any amount received in connection with such Initial
Remarketing in excess of the Minimum Initial Remarketing Price. In the event of
a Successful Secondary Remarketing, the Remarketing Agent shall retain as the
Remarketing Fee an amount not exceeding 25 basis points (0.25%), of the
principal amount of the remarketed Senior Notes from any amount received in
connection with such Secondary Remarketing in excess of the aggregate principal
amount of such re marketed Senior Notes. In addition, the Reset Agent shall, in
either case, receive from the Company a reasonable and customary fee (the "Reset
Agent Fee"); provided, however, that if the Remarketing Agent shall also act as
the Reset Agent, then the Reset Agent shall not be entitled to receive any such
Reset Agent Fee. Payment of such Reset Agent Fee shall be made by the Company on
the Initial
5
Remarketing Date, in the case of a Successful Initial Remarketing, or on the
third Business Day immediately preceding the Purchase Contract Settlement Date,
in the case of a Successful Secondary Remarketing, in immediately available
funds or, upon the instructions of the Reset Agent, by certified or official
bank check or checks or by wire transfer.
Section 4. Replacement and Resignation of Remarketing Agent. (a)
------------------------------------------------
The Company and Duke Capital may at any time in their absolute discretion
replace Xxxxxx Xxxxxxx as the Remarketing Agent and as the Reset Agent hereunder
pursuant to a 45 days' prior written notice to Xxxxxx Xxxxxxx, provided, that
the Company and Duke Capital must replace Xxxxxx Xxxxxxx both as Remarketing
Agent and as Reset Agent unless Xxxxxx Xxxxxxx shall otherwise agree. Any such
replacement shall become effective upon the Company and Duke Capital's appoint
ment of a successor to perform the services that would otherwise be performed
hereunder by the Remarketing Agent and the Reset Agent. Upon providing such
notice, the Company and Duke Capital shall use all reasonable efforts to appoint
such a successor and to enter into a remarketing agreement with such successor
as soon as reasonably practicable.
(b) Xxxxxx Xxxxxxx may resign at any time and be discharged from its
duties and obligations hereunder as the Remarketing Agent and/or as the Reset
Agent pursuant to a 45 days' prior written notice to the Company. Any such
resignation shall become effective upon the Company and Duke Capital's
appointment of a successor to perform the services that would otherwise be
performed hereunder by the Remarketing Agent and/or the Reset Agent. Upon
receiving notice from the Remarketing Agent and/or the Reset Agent that it
wishes to resign hereunder, the Company and Duke Capital shall appoint such a
successor and enter into a remarketing agreement with it as soon as reasonably
practicable.
(c) The Company and Duke Capital shall give the Purchase Contract
Agent, the Trustee, the Collateral Agent and the Custodial Agent prompt written
notice of the appointment of any successor Remarketing Agent and Reset Agent.
Section 5. Dealing in the Securities. Each of the Remarketing
-------------------------
Agent and the Reset Agent, when acting hereunder or, in the case of the
Remarketing Agent, under the Supplemental Remarketing Agreement, or when acting
in its individual or any other capacity, may, to the extent permitted by law,
buy, sell, hold or deal in any of the Senior Notes, Treasury Units, Corporate
Units or any other securities of the Company or Duke Capital. With respect to
any Senior Notes,
6
Treasury Units, Corporate Units or any other securities of the Company or Duke
Capital owned by it, each of the Remarketing Agent and the Reset Agent may
exercise any vote or join in any action with like effect as if it did not act in
any capacity hereunder. Each of the Remarketing Agent and the Reset Agent, in
its individual capacity, either as principal or agent, may also engage in or
have an interest in any financial or other transaction with the Company or Duke
Capital as freely as if it did not act in any capacity hereunder.
Section 6. Registration Statement and Prospectus. In connection
-------------------------------------
with the Initial Remarketing, if and to the extent required in the opinion of
counsel (which need not be a formal written opinion) for each of the Remarketing
Agent and the Company and Duke Capital by applicable law, regulations or
interpretations in effect at the time of such Initial Remarketing, the Company
and Duke Capital (i) shall use their reasonable efforts to have a registration
statement relating to the Senior Notes effective under the Securities Act of
1933 prior to the third Business Day immediately preceding _____________, 2004,
(ii) if requested by the Remarketing Agent shall furnish a current preliminary
prospectus and, if applicable, a current preliminary prospectus supplement to be
used by the Remarketing Agent in the Initial Remarketing not later than seven
Business Days prior to ____________, 2004 (or such earlier date as the
Remarketing Agent may reasonably request) and in such quantities as the
Remarketing Agent may reasonably request, and (iii) shall furnish a current
final prospectus and, if applicable, a final prospectus supplement to be used by
the Remarketing Agent in the Initial Remarketing not later than the third
Business Day immediately preceding ____________, 2004 in such quantities as the
Remarketing Agent may reasonably request, and shall pay all expenses relating
thereto. In the event of a Failed Initial Remarketing and in connection with the
Secondary Remarketing, if and to the extent required in the opinion of counsel
(which need not be a formal written opinion) for each of the Remarketing Agent
and the Company and Duke Capital by applicable law, regulations or
interpretations in effect at the time of such Secondary Remarketing, the Company
and Duke Capital (i) shall use their reasonable efforts to have a registration
statement relating to the Senior Notes effective under the Securities Act of
1933 prior to the third Business Day immediately preceding the Purchase Contract
Settlement Date, (ii) if requested by the Remarketing Agent, shall furnish a
current preliminary prospectus and, if applicable, a current preliminary
prospectus supplement to be used by the Remarketing Agent in the Secondary
Remarketing not later than seven Business Days prior to the Purchase Contract
Settlement Date (or such earlier date as the Remarketing Agent may reasonably
request) and in such quantities as the Remarketing Agent may reasonably request,
and (iii) shall furnish a current final prospectus and, if applicable, a final
prospectus supplement to be used by the
7
Remarketing Agent in the Secondary Remarketing not later than the third Business
Day immediately preceding the Purchase Contract Settlement Date in such
quantities as the Remarketing Agent may reasonably request, and shall pay all
expenses relating thereto. The Company and Duke Capital shall also take all such
actions as may (upon advice of counsel to each of the Company and Duke Capital
and the Remarketing Agent) be necessary or desirable under state securities or
blue sky laws in connection with the Initial Remarketing and the Secondary
Remarketing.
Section 7. Conditions to the Remarketing Agent's Obligations. (a)
-------------------------------------------------
The obligations of the Remarketing Agent and the Reset Agent under this
Agreement and, in the case of the Remarketing Agent, the Supplemental
Remarketing Agreement shall be subject to the terms and conditions of this
Agreement and the Supplemental Remarketing Agreement, including, without
limitation, the following conditions: (i) the Senior Notes tendered for, or
otherwise to be included in the Initial Remarketing or Secondary Remarketing, as
the case may be, have not been called for redemption, (ii) the Remarketing Agent
is able to find a purchaser or purchasers for tendered Senior Notes (1) in the
case of the Initial Remarketing, at a price not less than Minimum Initial
Remarketing Price, and (2) in the case of the Secondary Remarketing, at a price
not less than 100% of the principal amount thereof, (iii) the Purchase Contract
Agent, the Collateral Agent, the Custodial Agent, the Company, Duke Capital and
the Trustee shall have performed their respective obligations in connection with
the Initial Remarketing and, in the event of a Failed Initial Remarketing, in
connection with the Secondary Remarketing, in each case pursuant to the Purchase
Contract Agreement, the Pledge Agreement, the Indenture, this Agreement and the
Supplemental Remarketing Agreement (including, without limitation, giving the
Remarketing Agent notice of the Treasury Portfolio Purchase Price no later than
10:00 a.m., New York City time, on the fourth Business Day prior to
____________, 2004, in the case of the Initial Remarketing, and giving the
Remarketing Agent notice of the aggregate principal amount, as the case may be,
of Senior Notes to be remarketed, no later than 10:00 a.m., New York City time,
on the fourth Business Day prior to the Purchase Contract Settlement Date, in
the case of the Secondary Remarketing, and, in each case, concurrently
delivering the Senior Notes to be remarketed to the Remarketing Agent), (iv) no
Event of Default (as defined in the Indenture) shall have occurred and be
continuing, (v) the accuracy of the representations and warranties of the
Company and Duke Capital included and incorporated by reference in this
Agreement and the Supplemental Remarketing Agreement or in certificates of any
officer of the Company, Duke Capital or any of their subsidiaries delivered
pursuant to the provisions included or incorporated by reference in this
Agreement or the Supplemental Remarketing Agreement, (vi) the performance by the
Company and Duke Capital of their covenants and other
8
obligations included and incorporated by reference in this Agreement and the
Supplemental Remarketing Agreement, and (vii) the satisfaction of the other
conditions set forth and incorporated by reference in this Agreement and the
Supplemental Remarketing Agreement.
(b) If at any time during the term of this Agreement, any Event of
Default (as defined in the Indenture) has occurred and is continuing under the
Indenture, or the occurrence of an Event of Default is imminent, then the
obligations and duties of the Remarketing Agent and the Reset Agent under this
Agreement and the Supplemental Remarketing Agreement shall be suspended until
such default or imminent condition has been cured or eliminated, as the case may
be. The Company and Duke Capital will promptly give the Remarketing Agent
notice of all defaults and events referred to above of which the Company or Duke
Capital is aware.
Section 8. Termination of Remarketing Agreement. This Agreement
------------------------------------
shall terminate as to any Remarketing Agent or Reset Agent which is replaced on
the effective date of its replacement pursuant to Section 4(a) hereof or
pursuant to Section 4(b) hereof. Notwithstanding any such termination, the
obligations set forth in Section 3 hereof shall survive and remain in full force
and effect until all amounts payable under said Section 3 shall have been paid
in full. In addition, each former Remarketing Agent and Reset Agent shall be
entitled to the rights and benefits under Section 10 of this Agreement
notwithstanding the replacement or resignation of such Remarketing Agent or
Reset Agent.
Section 9. Remarketing Agent's Performance; Duty of Care. The
---------------------------------------------
duties and obligations of the Remarketing Agent and the Reset Agent shall be
determined solely by the express provisions of this Agreement and, in the case
of the Remarketing Agent, the Supplemental Remarketing Agreement. No implied
covenants or obligations of or against the Remarketing Agent or the Reset Agent
shall be read into this Agreement or the Supplemental Remarketing Agreement. In
the absence of bad faith on the part of the Remarketing Agent or the Reset
Agent, as the case may be, the Remarketing Agent and the Reset Agent each may
conclusively rely upon any document furnished to it which purports to conform to
the requirements of this Agreement or the Supplemental Remarketing Agreement, as
the case may be, as to the truth of the statements expressed therein. Each of
the Remarketing Agent and the Reset Agent shall be protected in acting upon any
document or communication reasonably believed by it to be signed, presented or
made by the proper party or parties. Neither the Remarketing Agent nor the Reset
Agent shall have any obligation to determine whether there is any limitation
under applicable law on the Reset Rate on the Senior Notes or, if there is any
such
9
limitation, the maximum permissible Reset Rate on the Senior Notes, and they
shall rely solely upon written notice from the Company and Duke Capital (which
the Company and Duke Capital agree to provide prior to the tenth Business Day
before __________, 2004, in the case of the Initial Remarketing, and prior to
the tenth Business Day before Purchase Contract Settlement Date, in the case of
the Secondary Remarketing) as to whether or not there is any such limitation
and, if so, the maximum permissible Reset Rate. Neither the Remarketing Agent
nor the Reset Agent shall incur any liability under this Agreement or the
Supplemental Remarketing Agreement to any beneficial owner or holder of Senior
Notes, or other securities, either in its individual capacity or as Remarketing
Agent or Reset Agent, as the case may be, for any action or failure to act in
connection with the Remarketing or otherwise in connection with the transactions
contemplated by this Agreement or the Supplemental Remarketing Agreement. The
provisions of this Section 9 shall survive any termination of this Agreement and
shall also continue to apply to every Remarketing Agent and Reset Agent
notwithstanding their resignation or removal.
Section 10. Indemnification and Contribution. (a) The Company and
--------------------------------
Duke Capital, jointly and severally, agrees to indemnify and hold harmless the
Remarketing Agent, the Reset Agent and their respective directors, officers,
employees, agents, affiliates and each person, if any, who controls the
Remarketing Agent or the Reset Agent within the meaning of either Section 15 of
the Securities Act of 1933, as amended (the "1933 Act"), or Section 20 of the
Securities Exchange Act of 1934, as amended (the "1934 Act") (the Remarketing
Agent, the Reset Agent and each such person or entity being an "Indemnified
Party"), as discussed below, provided that any such indemnification shall be
payable only in connection with any loss, claim, damage liability or expense
which has been incurred or suffered by the relevant Indemnified Party in
connection with the Remarketing Agent or the Reset Agent performing its
obligations and responsibilities hereunder and any acts incidental thereto:
(i) from and against any and all losses, claims, damages, liabilities
and expenses whatsoever, joint or several, as incurred, to which such
Indemnified Party may become subject under any applicable federal or state law,
or otherwise, and related to, arising out of, or based on (A) the failure to
have an effective Registration Statement (as defined in the Supplemental
Remarketing Agreement) under the 1933 Act relating to the Senior Notes, as the
case may be, if required, or the failure to satisfy the prospectus delivery
requirements of the 1933 Act because the Company or Duke Capital failed to
provide the Remarketing Agent with a Prospectus (as defined in the Supplemental
Remarketing Agreement) for
10
delivery, or (B) any untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement or any amendment thereto (including
any information deemed to be a part of the Registration Statement at the time it
became effective pursuant to paragraph (b) of Rule 430A under the 1933 Act, if
applicable), 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 (C) any untrue statement or alleged untrue statement of a
material fact contained in any preliminary prospectus or the 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, or (D)
any untrue statement or alleged untrue statement of a material fact contained in
any other information (whether oral or written) or documents (including, without
limitation, any documents incorporated or deemed to be incorporated by reference
in any such information or documents) provided by the Company for use in
connection with the remarketing of the Senior Notes or any of the transactions
related thereto, or (E) any breach by the Company or Duke Capital of any of the
representations, warranties or agreements included or incorporated by reference
in this Agreement or the Supplemental Remarketing Agreement, or (F) any failure
by the Company or Duke Capital to make or consummate the remarketing of the
Senior Notes (including, without limitation, any Failed Initial Remarketing or
Failed Secondary Remarketing) or the withdrawal, recession, termination,
amendment or extension of the terms of such remarketing, or (G) any failure on
the part of the Company or Duke Capital to comply, or any breach by the Company
of, any of the provisions included or incorporated by reference in this
Agreement, the Supplemental Remarketing Agreement, the Purchase Contract
Agreement, the Corporate Units, the Treasury Units, the Pledge Agreement, the
Indenture or the Senior Notes (collectively, the "Operative Documents") or (H)
the remarketing of the Senior Notes, as the case may be, or any other
transaction contemplated by any of the Operative Documents, or the engagement of
the Remarketing Agent or the Reset Agent pursuant to, or the performance by the
Remarketing Agent or the Reset Agent of the respective services contemplated by,
this Agreement or the Supplemental Remarketing Agreement, whether or not the
Initial Remarketing or the Secondary Remarketing or the reset of the interest
rate on the Senior Notes as contemplated herein actually occur;
(ii) against any and all loss, liability, claim, damage and expense
whatsoever, to the extent of the aggregate amount paid in settlement of any
litigation, commenced or threatened, or of any claim whatsoever related to, or
based on any untrue statement or omission on any alleged untrue statement or
omission
11
described in clause (i) above if such settlement is effected with the written
consent of the Company and Duke Capital; and
(iii) against any and all expense whatsoever, reasonably incurred
in investigating, preparing or defending against any litigation, commenced or
threatened, or any claim whatsoever related to, based on any untrue statement or
omission on any alleged untrue statement or omission described in clause (i)
above, to the extent that any such expense is not paid under clause (i) or (ii)
above;
provided, however, that the Company and Duke Capital shall not be liable under
clause (i) with respect to any claim made against any Indemnified Party or
Parties unless the Company and Duke Capital shall be notified in writing of the
nature of the claim within a reasonable time after the assertion thereof, but
failure so to notify the Company and Duke Capital shall not relieve it from any
liability which it may have otherwise than on account of this Section 10. The
Company and Duke Capital shall be entitled to participate at their own expense
in the defense, or, if it so elects, within a reasonable time after receipt of
such notice, to assume the defense shall be conducted by counsel chosen by it
and approved by the Indemnified Party or Parties or, defendant or defendants in
any suit so brought, which approval shall not be unreasonably withheld. In any
such suit, any Indemnified Party shall have the right to employ its own counsel,
but the fees and expenses of such counsel shall be at the expense of such
Indemnified Party unless (i) the Company and Duke Capital and such Indemnified
Party shall have mutually agreed to the employment of such counsel, or (ii) the
named parties to any such action (including any impleaded parties) include both
such Indemnified Party and the Company and Duke Capital and such Indemnified
Party shall have been advised by such counsel that a conflict of interest
between the Company and Duke Capital and such Indemnified Party may arise and
for this reason it is not desirable for the same counsel to represent both the
indemnifying party and also the Indemnified Party (it being understood, however,
that the Company and Duke Capital shall not, in connection with any one such
action or separate but substantially similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances, be
liable for the reasonable fees and expenses of more than one separate firm of
attorneys for all such Indemnified Parties).
(b) The Remarketing Agent agrees that it will indemnify and hold
harmless the Company and Duke Capital, their directors and each of the officers
of the Company and Duke Capital who signed the respective Registration
Statements and each Person, if any, who controls the Company and Duke Capital
within the meaning of Section 15 of the 1933 Act to the same extent as the
indemnity contained
12
in subsection (a) of this Section, but only with respect to statements or
omissions made in the Registration Statements (or any amendment thereto) or any
Preliminary Prospectus, such prospectus or the Prospectus (or any amendment or
supplement thereto) in reliance upon and in conformity with written information
furnished to the Company and Duke Capital by the Remarketing Agent expressly for
use in the Registration Statements (or any amendment thereto), such Preliminary
Prospectus, such prospectus or the Prospectus (or any amendment or supplement
thereto). In case any action shall be brought against the Company and Duke
Capital or any Person so indemnified based on the Registration Statements (or
any amendment thereto) or such Preliminary Prospectus, such prospectus or the
Prospectus (or any amendment or supplement thereto) and in respect of which
indemnity may be sought against the Remarketing Agent, shall have the rights and
duties given to the Company and Duke Capital, and the Company and Duke Capital
and each Person so indemnified shall have the rights and duties given to the
Indemnified Parties, by the provisions of subsection (a) of this Section.
(c) No indemnifying party shall, without the prior written consent of
the indemnified party, effect any settlement of any pending or threatened
proceeding in respect of which any indemnified party is or could have been a
party and indemnity could have been sought hereunder by such indemnified party,
unless such settlement includes an unconditional release of such indemnified
party from all liability on claims that are the subject matter of such
proceeding.
(d) If the indemnification provided for in this Section 10 is
unavailable to or insufficient to hold harmless an indemnified party in respect
of any and all loss, liability, claim, damage and expense whatsoever (or actions
in respect thereof) that would otherwise have been indemnified under the terms
of such indemnity, then each indemnifying party shall contribute to the amount
paid or payable by such indemnified party as a result of such loss, liability,
claim, damage or expense (or actions in respect thereof) in such proportion as
is appropriate to reflect the relative benefits received by the Company and Duke
Capital on the one hand and the Remarketing Agent on the other from the
Remarketing offering of the Units. If, however, the allocation provided by the
immediately preceding sentence is not permitted by applicable law or if the
indemnified party failed to give the notice required above, then each
indemnifying party shall contribute to such amount paid or payable by such
indemnified party in such proportion as is appropriate to reflect not only such
relative benefits but also the relative fault of the Company and Duke Capital on
the one hand and the Remarketing Agent on the other in connection with the
statements or omissions which resulted in such losses, liability, claim, damage
or expense (or actions in respect thereof), as well as any other relevant equity
13
considerations. The relative benefits received by the Company and Duke Capital
on the one hand and the Remarketing Agent on the other shall be deemed to be in
the same proportion as the total net proceeds from the remarketing (before
deducting expenses) received by Duke Capital bear to the total compensation
received by the Remarketing Agent in respect of the Remarketing. The relative
fault shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the Company
and Duke Capital on the one hand or the Remarketing Agent on the other and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. The Company and Duke Capital and
the Remarketing Agent agree that it would not be just and equitable if
contributions pursuant to this section were determined by pro rata allocation or
by any other method of allocation which does not take account of the equitable
considerations referred to above in this section. The amount paid or payable by
an indemnified party as a result of the losses, liabilities, claims, damages or
expenses (or actions in respect thereof) referred to above in this section shall
be deemed to include any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such action
or claim. Notwithstanding the provisions of this Section 10, the Remarketing
Agent shall not be required to contribute any amount in excess of the amount by
which the aggregate stated amount of the Senior Notes which were remarketed
exceeds the amount of any damages which the Remarketing Agent has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the 0000 Xxx) shall be entitled to contribution
from any person who was not guilty of such fraudulent misrepresentation.
(e) Anything herein or in the Supplemental Remarketing Agreement to
the contrary notwithstanding, the provisions of this Section 10, and the rights
of the Remarketing Agent, the Reset Agent and the other Indemnified Parties
hereunder, shall be in addition to, and not in limitation of, any rights or
benefits (including, without limitation, rights to indemnification or
contribution) which the Remarketing Agent, the Reset Agent or any other
Indemnified Party may have under any other instrument or agreement.
Section 11. Governing Law. This Agreement shall be governed by and
-------------
construed in accordance with the laws of the State of New York without regard to
principles of conflicts of laws.
14
Section 12. Term of Agreement. (a) Unless otherwise terminated in
-----------------
accordance with the provisions hereof and except as otherwise provided herein,
this Agreement shall remain in full force and effect from the date hereof until
the first day thereafter on which no Senior Notes are outstanding, or, if
earlier, the Business Day immediately following ___________, 2004, in the case
of a Successful Initial Remarketing, or the Business Day immediately following
the Purchase Contract Settlement Date, in the case of a Successful Secondary
Remarketing. Anything herein to the contrary notwithstanding, the provisions of
the last sentence of Section 8 hereof and the provisions of Sections 3, 9, 10
and 12(b) hereof shall survive any termination of this Agreement and remain in
full force and effect.
(b) All representations and warranties included or incorporated by
reference in this Agreement, or the Supplemental Remarketing Agreement, or
contained in certificates of officers of the Company or Duke Capital submitted
pursuant hereto or thereto, shall remain operative and in full force and effect,
regardless of any investigation made by or on behalf of the Remarketing Agent,
the Reset Agent or any of their controlling persons, or by or on behalf of the
Company, Duke Capital or the Purchase Contract Agent, and shall survive the
remarketing of the Senior Notes.
Section 13. Successors and Assigns. The rights and obligations of
----------------------
the Company, Duke Capital and the Purchase Contract Agent (both in its capacity
as Purchase Contract Agent and as attorney-in-fact) hereunder may not be
assigned or delegated to any other person without the prior written consent of
the Remarketing Agent and the Reset Agent, except, with respect to the Purchase
Contract Agent, in connection with the appointment of a successor thereto
pursuant to the Purchase Contract Agreement. The rights and obligations of the
Remarketing Agent and the Reset Agent hereunder may not be assigned or delegated
to any other person without the prior written consent of the Company and Duke
Capital, except that the Remarketing Agent shall have the right to appoint
additional remarketing agents as provided herein. This Agreement shall inure to
the benefit of and be binding upon the Company, Duke Capital, the Purchase
Contract Agent, the Remarketing Agent and the Reset Agent and their respective
successors and assigns and the other Indemnified Parties (as defined in Section
10 hereof) and the successors, assigns, heirs and legal representatives of the
Indemnified Parties. The terms "successors" and "assigns" shall not include any
purchaser of Securities or Senior Notes merely because of such purchase.
Section 14. Headings. Section headings have been inserted in this
--------
Agreement and the Supplemental Remarketing Agreement as a matter of
15
convenience of reference only, and it is agreed that such section headings are
not a part of this Agreement or the Supplemental Remarketing Agreement and will
not be used in the interpretation of any provision of this Agreement or the
Supplemental Remarketing Agreement.
Section 15. Severability. If any provision of this Agreement or
------------
the Supplemental Remarketing Agreement shall be held or deemed to be or shall,
in fact, be invalid, inoperative or unenforceable as applied in any particular
case in any or all jurisdictions because it conflicts with any provisions of any
constitution, statute, rule or public policy or for any other reason, then, to
the extent permitted by law, such circumstances shall not have the effect of
rendering the provision in question invalid, inoperative or unenforceable in any
other case, circumstances or jurisdiction, or of rendering any other provision
or provisions of this Agreement or the Supplemental Remarketing Agreement, as
the case may be, invalid, inoperative or unenforceable to any extent whatsoever.
Section 16. Counterparts. This Agreement and the Supplemental
------------
Remarketing Agreement may be executed in counterparts, each of which shall be
regarded as an original and all of which shall constitute one and the same
document.
Section 17. Amendments. This Agreement and the Supplemental
----------
Remarketing Agreement may be amended by any instrument in writing signed by the
parties hereto. The Company, Duke Capital and the Purchase Contract Agent agree
that they will not enter into, cause or permit any amendment or modification of
the Purchase Contract Agreement, the Third Supplemental Indenture, the Pledge
Agreement, the Senior Notes, the Equity Units or any other instruments or
agreements relating to the Senior Notes or the Equity Units which would
materially and adversely affect the rights, duties or obligations of the
Remarketing Agent or the Reset Agent without the prior written consent of the
Remarketing Agent or the Reset Agent, as the case may be.
Section 18. Notices. Unless otherwise specified, any notices,
-------
requests, consents or other communications given or made hereunder or pursuant
hereto shall be made in writing or transmitted by any standard form of
telecommunication, including telephone or telecopy, and confirmed in writing.
All written notices and confirmations of notices by telecommunication shall be
deemed to have been validly given or made when delivered or mailed, registered
or certified mail, return receipt requested and postage prepaid. All such
notices, requests, consents or other communications shall be addressed as
follows: if to the Company or Duke Capital, to Duke Energy Corporation, 000
Xxxxx Xxxxxx Xxxxxx, Xxxxxxxxx,
00
Xxxxx Xxxxxxxx 00000, Attention: Chief Financial Officer, with a copy to Xxxxx
Xxxxxxxxxx LLP, 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, XX 00000, Attention: Xxxx
Xxxxxxx; if to the Remarketing Agent or Reset Agent, to Xxxxxx Xxxxxxx, 0000
Xxxxxxxx, Xxx Xxxx, XX 00000, Attention: _________, with a copy to Skadden,
Arps, Slate, Xxxxxxx & Xxxx LLP, Xxxx Xxxxx Xxxxxx, Xxx Xxxx, XX 00000,
Attention: Xxxx X. Xxxxxx; and if to the Purchase Contract Agent, to The Chase
Manhattan Bank, 000 Xxxx 00xx Xxxxxx, Xxx Xxxx, XX 00000, Attention:
Institutional Trust Services, or to such other address as any of the above shall
specify to the other in writing.
Section 19. Information. The Company and Duke Capital agree to
-----------
furnish the Remarketing Agent and the Reset Agent with such information and
documents as the Remarketing Agent or the Reset Agent may reasonably request in
connection with the transactions contemplated by this Remarketing Agreement and
the Supplemental Remarketing Agreement, and make reasonably available to the
Remarketing Agent, the Reset Agent and any accountant, attorney or other advisor
retained by the Remarketing Agent or the Reset Agent such information that
parties would customarily require in connection with a due diligence
investigation conducted in accordance with applicable securities laws and cause
the Company's and Duke Capital's officers, directors, employees and accountants
to participate in all such discussions and to supply all such information
reasonably requested by any such person in connection with such investigation.
17
IN WITNESS WHEREOF, each of the Company, Duke Capital, the Purchase
Contract Agent and the Remarketing Agent has caused this Agreement to be
executed in its name and on its behalf by one of its duly authorized signatories
as of the date first above written.
DUKE ENERGY CORPORATION
By: ____________________________
Name:
Title:
DUKE CAPITAL CORPORATION
By: ____________________________
Name:
Title:
CONFIRMED AND ACCEPTED:
XXXXXX XXXXXXX & CO.
INCORPORATED
By: ____________________________________
Authorized Signatory
THE CHASE MANHATTAN BANK
not individually but solely as Purchase Contract
Agent and as attorney-in-fact for the holders of
the Purchase Contracts
By: ____________________________________
Name:
Title:
Exhibit A to
Remarketing Agreement
---------------------
Form of Supplemental Remarketing Agreement
Supplemental Remarketing Agreement dated _____________, ____ among Duke
Energy Corporation, a North Carolina corporation (the "Company"), Duke Capital
Corporation, a Delaware corporation and wholly owned subsidiary of the Company
("Duke Capital"), Xxxxxx Xxxxxxx & Co. Incorporated (the "Remarketing Agent"),
and The Chase Manhattan Bank, as Purchase Contract Agent and attorney-in-fact
for the Holders of the Purchase Contracts (as such terms are defined in the
Purchase Contract Agreement referred to in Schedule I hereto)
NOW, THEREFORE, for and in consideration of the covenants herein made, and
for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto agree as follows:
1. Definitions. Capitalized terms used and not defined in this
-----------
Agreement shall have the meanings assigned to them in the Remarketing Agreement
dated as of March __, 2001 (the "Remarketing Agreement") among the Company, Duke
Capital, the Purchase Contract Agent and Xxxxxx Xxxxxxx & Co. Incorporated or,
if not defined in the Remarketing Agreement, the meanings assigned to them in
the Purchase Contract Agreement (as defined in Schedule I hereto).
2. Registration Statement and Prospectus. Duke Capital has filed with
-------------------------------------
the Securities and Exchange Commission, and there has become effective, a
registration statement on Form S-3, including a prospectus, relating to the
Securities (as such term is defined on Schedule I hereto). Such Registration
Statement, as amended, and including the information deemed to be a part thereof
pursuant to Rule 430A under the Securities Act of 1933, as amended (the "1933
Act"), and the documents incorporated or deemed to be incorporated by reference
therein, are hereinafter called, collectively, the "Registration Statement";
the related preliminary prospectus dated March 2, 2001, including the documents
incorporated or deemed to be incorporated by reference therein, [and preliminary
prospectus supplemented dated __________] are hereinafter called, [collectively]
the "preliminary prospectus";] and the related prospectus dated ______________,
including the documents incorporated or deemed to be incorporated by reference
therein, [and prospectus supplement dated _______________] are hereinafter
called, [collectively,] the "Prospectus." The Company and Duke Capital have
provided copies of the Registration Statement
[, the preliminary prospectus] and the Prospectus to the Remarketing Agent, and
hereby consents to the use of the [preliminary prospectus] and the Prospectus in
connection with the remarketing of the Securities. [In the event that a
Registration Statement is not required, insert the following: The Company and
Duke Capital have provided to the Remarketing Agent, for use in connection with
remarketing of the Securities (as such term is defined on Schedule I hereto), a
[preliminary remarketing memorandum and] remarketing memorandum and [describe
other materials, if any]. Such remarketing memorandum (including the documents
incorporated or deemed to be incorporated by reference therein, [and] [describe
other materials] are hereinafter called, collectively, the "Prospectus," [and
such preliminary marketing memorandum (including the documents incorporated or
deemed to be incorporated by reference therein) is hereinafter called a
"preliminary prospectus")]. The Company and Duke Capital hereby consent to the
use of the Prospectus [and the preliminary prospectus] in connection with the
remarketing of the Securities]. All references in this Agreement to amendments
or supplements to the Registration Statement [, the preliminary prospectus] or
the Prospectus shall be deemed to mean and include the filing of any document
under the Securities Exchange Act of 1934, as amended (the "1934 Act"), which is
incorporated or deemed to be incorporated by reference in the Registration
Statement [, the preliminary prospectus] or the Prospectus, as the case may be.
3. Provisions Incorporated by Reference.
------------------------------------
(a) Subject to Section 3(b) hereof, the provisions of the Underwriting
Agreement (other than Section 1, Section 3, Section 4, Section 5, Section 8 and
Section 9 thereof) are incorporated herein by reference, mutatis mutandis, and
the Company and Duke Capital hereby make the representations and warranties, and
agrees to comply with the covenants and obligations, set forth in the provisions
of the Underwriting Agreement incorporated by reference herein, as modified by
the provisions of Section 3(b) hereof.
(b) With respect to the provisions of the Underwriting Agreement
incorporated herein, for the purposes hereof, (i) all references therein to the
"Underwriter" or "Underwriters" shall be deemed to refer to the Remarketing
Agent and all references to the "Representative" or the "Representatives" shall
be deemed to refer to Xxxxxx Xxxxxxx & Co. Incorporated ("Xxxxxx Xxxxxxx"); (ii)
all references therein to the "Units" or "Firm Units" shall be deemed to refer
to the Securities as defined herein; (iii) all references therein to the "Time
of Delivery" shall be deemed to refer to the Remarketing Closing Date specified
in Schedule I hereto; (iv) all references therein to the "Registration
Statement", the "Preliminary Prospectus" or
A-2
the "final prospectus" shall be deemed to refer to the Registration Statement
[,the preliminary prospectus] and the Prospectus, respectively, as defined
herein; (v) all references therein to this "Agreement," the "Underwriting
Agreement," "hereof," "herein" and all references of similar import, shall be
deemed to mean and refer to this Supplemental Remarketing Agreement; (vi) all
references therein to "the date hereof," "the date of this Agreement" and all
similar references shall be deemed to refer to the date of this Supplemental
Remarketing Agreement; (vii) all references therein to any "settlement date"
shall be disregarded; and (viii) [other changes].]
4. Remarketing. Subject to the terms and conditions and in reliance
-----------
upon the representations and warranties herein set forth or incorporated by
reference herein and in the Remarketing Agreement, the Remarketing Agent agrees
to use its reasonable efforts to remarket, in the manner set forth in Section
2(b) of the Remarketing Agreement, the aggregate principal amount, as the case
may be, of Securities set forth in Schedule I hereto at a purchase price not
less than 100% of the [Minimum Initial Remarketing Price] [aggregate principal
amount of the Securities]. In connection therewith, the registered holder or
holders thereof agree, in the manner specified in Section 5 hereof, to pay to
the Remarketing Agent a Remarketing Fee equal to an amount not exceeding 25
basis points (0.25%) of [the Minimum Initial Remarketing Price] [such aggregate
principal amount,] payable by deduction from any amount received in connection
from such [Initial][Secondary] Remarketing in excess of the [Minimum Initial
Remarketing Price] [aggregate principal amount of the Securities]. Pursuant to
the Third Supplemental Indenture, right of each holder of Securities to have
Securities tendered for purchase shall be limited to the extent set forth in the
last sentence of Section 2(b) of the Remarketing Agreement (which is
incorporated by reference herein). As more fully provided in Section 2(c) of
the Remarketing Agreement (which is incorporated by reference herein), the
Remarketing Agent is not obligated to purchase any Securities in the remarketing
or otherwise, and neither the Company nor the Remarketing Agent shall be
obligated in any case to provide funds to make payment upon tender of Securities
for remarketing.
5. Delivery and Payment. Delivery of payment for the remarketed
--------------------
Securities by the purchasers thereof identified by the Remarketing Agent and
payment of the Remarketing Fee shall be made on the Remarketing Closing Date at
the location and time specified in Schedule I hereto (or such later date not
later than five Business Days after such date as the Remarketing Agent shall
designate), which date and time may be postponed by agreement between the
Remarketing Agent and the Company and Duke Capital. Delivery of the remarketed
Securities and payment of the Remarketing Fee shall be made to the Remarketing
Agent against payment by
A-3
the respective purchasers of the remarketed Securities of the consideration
therefor as specified herein, which consideration shall be paid to the
Collateral Agent for the account of the persons entitled thereto by certified or
official bank check or checks drawn on or by a New York Clearing House bank and
payable in immediately available funds or in immediately available funds by wire
transfer to an account or accounts designated by the Collateral Agent.
If the Securities are not represented by a Global Security held by or on
behalf of The Depository Trust Company, certificates for the Securities shall be
registered in such names and denominations as the Remarketing Agent may request
not less than one full Business Day in advance of the Remarketing Closing Date,
and the Company, Duke Capital, the Collateral Agent and the registered holder or
holders thereof agree to have such certificates available for inspection,
packaging and checking by the Remarketing Agent in New York, New York not later
than 1:00 p.m. on the Business Day prior to the Remarketing Closing Date.
6. Notices. Unless otherwise specified, any notices, requests,
-------
consents or other communications given or made hereunder or pursuant hereto
shall be made in writing or transmitted by any standard form of
telecommunication, including telephone or telecopy, and confirmed in writing.
All written notices and confirmations of notices by telecommunication shall be
deemed to have been validly given or made when delivered or mailed, by
registered or certified mail, return receipt requested and postage prepaid. All
such notices, requests, consents or other communications shall be addressed as
follows: if to the Company or Duke Capital, to 000 Xxxxx Xxxxxx Xxxxxx,
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000, Attention: Chief Financial Officer, with a copy
to Xxxxx Xxxxxxxxxx LLP, 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, XX 00000,
Attention: Xxxx Xxxxxxx; if to the Remarketing Agent, to Xxxxxx Xxxxxxx & Co.
Incorporated, at 0000 Xxxxxxxx, Xxx Xxxx, XX 00000, Attention: __________; with
a copy to Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP, Xxxx Xxxxx Xxxxxx, Xxx Xxxx,
XX 00000, Attention: Xxxx X. Xxxxxx; and if to the Purchase Contract Agent, to
The Chase Manhattan Bank, 000 Xxxx 00xx Xxxxxx, Xxx Xxxx, XX 00000, Attention:
Institutional Trust Services, or to such other address as any of the above shall
specify to the other in writing.
7. Conditions to Obligations of Remarketing Agent. Anything herein to
----------------------------------------------
the contrary notwithstanding, the parties hereto agree that the obligations of
the Remarketing Agent under this Agreement and the Remarketing Agreement are
subject to the satisfaction of the conditions set forth in Section 7 of the
Remarketing Agreement (which are incorporated herein by reference), and to the
satisfaction, on the Remarketing Closing Date, of the conditions incorporated by
reference herein
A-4
from Section 7 of the Underwriting Agreement as modified by Section 3(b) hereof
(including, without limitation, the delivery of opinions of counsel, officers'
certificates and accountants' comfort letters as reasonably requested by the
Remarketing Agent and in form and substance reasonably satisfactory to the
Remarketing Agent, the accuracy as of the Remarketing Closing Date of the
representations and warranties of the Company and Duke Capital included and
incorporated by reference herein and the performance by the Company and Duke
Capital of their obligations under the Remarketing Agreement and this Agreement
as and when required hereby and thereby). In addition, anything herein or in the
Remarketing Agreement to the contrary notwithstanding, the Remarketing Agreement
and this Agreement may be terminated by the Remarketing Agent, by notice to the
Company and Duke Capital at any time prior to the time of settlement on the
Remarketing Closing Date, if any of the events or conditions set forth in
Section 7(h) of the Underwriting Agreement, as modified by Section 3(b) hereof,
shall have occurred or shall exist.
8. Indemnity and Contribution. Anything herein to the contrary
--------------------------
notwithstanding, the Remarketing Agent shall be entitled to indemnity and
contribution on the terms and conditions set forth in the Remarketing Agreement.
A-5
If the foregoing is in accordance with your understanding of our agreement,
please sign and return to us the enclosed duplicate hereof, whereupon this
letter and your acceptance shall represent a binding agreement among the Company
and the Remarketing Agent.
Very truly yours,
DUKE ENERGY CORPORATION
By:_____________________________________
Name:
Title:
DUKE CAPITAL CORPORATION
By:_____________________________________
Name:
Title:
CONFIRMED AND ACCEPTED:
XXXXXX XXXXXXX & CO. INCORPORATED
By: ____________________________
Authorized Signatory
[Add other Remarketing Agents, if any]
THE CHASE MANHATTAN BANK
not individually but solely as Purchase Contract
Agent and as attorney-in-fact for the holders of
the Purchase Contracts
By :____________________________
Name:
Title:
A-6
SCHEDULE I
Securities subject to the remarketing: ___% Senior Notes
due 2006 of Duke Capital (the "Securities").
Purchase Contract Agreement, dated as of March __, 2001
(the "Purchase Contract Agreement") by and between Duke Energy Corporation,
a North Carolina corporation, and The Chase Manhattan Bank, a New York
banking corporation.
Pledge Agreement dated as of March __, 2001 (the "Pledge Agreement") by and
between Duke Energy Corporation, a North Carolina corporation, Bank One
Trust Company, a national banking association, and The Chase Manhattan
Bank.
Indenture dated as of April 1, 1998 (the "Senior Indenture") by and between Duke
Capital Corporation, a Delaware corporation, and The Chase Manhattan Bank,
a New York banking corporation, as trustee.
Third Supplemental Indenture, dated as of March __, 2001
(the "Third Supplemental Indenture" and, together with the Senior
Indenture, the "Indenture") by and between Duke Capital Corporation, a
Delaware corporation, and The Chase Manhattan Bank, a New York banking
corporation, as trustee.
[Minimum Initial Remarketing Price]
[Aggregate Principal Amount of Securities: $ ____________]
Underwriting Agreement, dated March __, 2001 (the "Underwriting Agreement")
among Duke Energy Corporation, Duke Capital Corporation, Xxxxxx Xxxxxxx &
Co. Incorporated, Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated, Bank
of America Securities LLC, Credit Suisse First Boston Corporation and X. X.
Xxxxxx Securities Inc.
Remarketing Closing Date, Time and Location:
A-7
REMARKETING AGREEMENT
REMARKETING AGREEMENT, dated as of March __, 2001 (the "Agreement") by
and between Duke Energy Corporation a North Carolina corpora tion (the
"Company"), Duke Capital corporation, a Delaware corporation and wholly owned
subsidiary of the Company ("Duke Capital") The Chase Manhattan Bank, a New York
banking corporation, not individually but solely as Purchase Contract Agent (the
"Purchase Contract Agent") and as attorney-in-fact of the holders of Purchase
Contracts (as defined in the Purchase Contract Agreement (as defined herein)),
and Xxxxxx Xxxxxxx & Co. Incorporated (the "Remarketing Agent").
WITNESSETH:
WHEREAS, the Company will issue $500,000,000 (or $575,000,000 if the
Underwriters' (as defined in the Underwriting Agreement) overallotment option is
exercised in full) aggregate Stated Amount of its Equity Units (the "Equity
Units") under the Purchase Contract Agreement, dated as of March , 2001, by and
between the Purchase Contract Agent and the Company (the "Purchase Contract
Agreement"); and
WHEREAS, the Equity Units will initially consist of 20,000,000 (or
23,000,000 if the Underwriters' overallotment option is exercised in full) units
referred to as "Corporate Units;" and
WHEREAS, Duke Capital will issue concurrently in connection with the
issuance of the Equity Units $500,000,000 (or $575,000,000 if the Underwriters'
overallotment option is exercised in full) aggregate principal amount of ___%
Senior Notes due 2006 (the "Senior Notes") of the Company; and
WHEREAS, the Senior Notes forming a part of the Corporate Units will
be pledged pursuant to the Pledge Agreement (the "Pledge Agreement"), dated as
of March __, 2001, by and among the Company, Bank One Trust Company, N.A., as
collateral agent (the "Collateral Agent") and the Purchase Contract Agent, to
secure a Corporate Units holder's obligations under the related Purchase
Contract on the Purchase Contract Settlement Date; and
WHEREAS, the Senior Notes of the Senior Noteholders electing to have
their Senior Notes remarketed and of the Corporate Unit holders will be re
marketed by the Remarketing Agent on the third Business Day immediately preced
ing __________, 2004 (the "Initial Remarketing Date"); and
WHEREAS, in the event of a Failed Initial Remarketing, the Senior
Notes of the Senior Noteholders electing to have their Senior Notes remarketed
and of the Corporate Unit holders who have elected not to settle the Purchase
Contracts related to their Corporate Units by Cash Settlement and who have not
early settled their Purchase Contracts will be remarketed by the Remarketing
Agent on the third Business Day immediately preceding the Purchase Contract
Settlement Date; and
WHEREAS, in the event of a Successful Initial Remarketing, the
applicable interest rate on the Senior Notes will be reset on the Initial
Remarketing Date, to the Reset Rate to be determined by the Reset Agent as the
rate that such Senior Notes should bear in order for the Applicable Principal
Amount of the Senior Notes to have an approximate aggregate market value of
100.5% of the Treasury Portfolio Purchase Price on the Initial Remarketing Date,
provided that in the determination of such Reset Rate, the Company and Duke
Capital shall, if applicable, limit the Reset Rate to the maximum rate
permitted by applicable law; and
WHEREAS, in the event of a Failed Initial Remarketing, the
applicable interest rate on the Senior Notes that remain outstanding on and
after the Purchase Contract Settlement Date will be reset on the third Business
Day immediately preceding the Purchase Contract Settlement Date, to the Reset
Rate to be determined by the Reset Agent as the rate that such Senior Notes
should bear in order to have an approximate market value of 100.5% of the
aggregate principal amount of the Senior Notes on the third Business Day
immediately preceding the Purchase Contract Settlement Date, provided that in
the determination of such Reset Rate, the Company and Duke Capital shall, if
applicable, limit the Reset Rate to the maximum rate permitted by applicable
law; and
WHEREAS, the Company and Duke Capital have requested Xxxxxx Xxxxxxx &
Co. Incorporated ("Xxxxxx Xxxxxxx") to act as the Reset Agent and as the
Remarketing Agent, and as such to perform the services described herein; and
WHEREAS, Xxxxxx Xxxxxxx is willing to act as Reset Agent and
Remarketing Agent and as such to perform such duties on the terms and conditions
expressly set forth herein;
2
NOW, THEREFORE, for and in consideration of the covenants herein made,
and subject to the conditions herein set forth, the parties hereto agree as
follows:
Section 1. Definitions. Capitalized terms used and not defined in
-----------
this Agreement, in the recitals hereto or in the paragraph preceding such
recitals shall have the meanings assigned to them in the Purchase Contract
Agreement or, if not therein defined, the Pledge Agreement.
Section 2. Appointment and Obligations of Remarketing Agent.
------------------------------------------------
(a) The Company and Duke Capital hereby appoint Xxxxxx Xxxxxxx and Xxxxxx
Xxxxxxx hereby accepts such appointment, (i) as the Reset Agent to deter mine
in consultation with the Company and Duke Capital, in the manner provided for
herein and in the Third Supplemental Indenture (as in effect on the date of this
Remarketing Agreement or as amended, provided that any such amendment does not
render such indenture inconsistent with the Remarketing Agreement or any Supple
mental Remarketing Agreement (as defined below) in respect of the remarketing
procedures or adversely affects the Remarketing Agent's rights, unless such
amend ment is effected with the prior written consent of the Remarketing Agent)
with re spect to the Senior Notes, (1) the Reset Rate that, in the opinion of
the Reset Agent, will, when applied to the Senior Notes, enable the Applicable
Principal Amount of the Senior Notes to have an approximate aggregate market
value of 100.5% of the Treasury Portfolio Purchase Price as of the Initial
Remarketing Date, and (2) in the event of a Failed Initial Remarketing, the
Reset Rate that, in the opinion of the Reset Agent, will, when applied to the
Senior Notes, enable a Senior Note to have an approximate market value of 100.5%
of its principal amount as of the third Business Day preceding the Purchase
Contract Settlement Date, provided, in each case, that the Company and Duke
Capital, by notice to the Reset Agent prior to the tenth Business Day preceding
_____, 2004, in the case of the Initial Remarketing (as defined below), or the
Purchase Contract Settlement Date, in the case of the Second ary Remarketing
(as defined below), shall, if applicable, limit the Reset Rate so that it does
not exceed the maximum rate permitted by applicable law) and (ii) as the
exclusive Remarketing Agent (subject to the right of Xxxxxx Xxxxxxx to appoint
additional remarketing agents hereunder as described below) to (1) remarket the
Senior Notes of the Senior Noteholders electing to have their Senior Notes
remarketed and of the Corporate Units holders on the Initial Remarketing Date,
for settlement on ____________, 2004 and (2) in the case of a Failed Initial
Remarketing, remarket the Senior Notes of the Senior Noteholders electing to
have their Senior Notes remarketed or of the Corporate Units holders who have
not early
3
settled the related Purchase Contracts and have failed to notify the Purchase
Contract Agent, on or prior to the fifth Business Day immediately preceding the
Purchase Contract Settlement Date, of their intention to settle the related
Purchase Contracts through Cash Settlement. In connection with the remarketing
contemplated hereby, the Remarketing Agent will enter into a Supplemental
Remarketing Agreement (the "Supplemental Remarketing Agreement") with the
Company, Duke Capital and the Purchase Contract Agent, which shall either be (i)
substantially in the form attached hereto as Exhibit A (with such changes as the
Company, Duke Capital and the Remarketing Agent may agree upon, it being
understood that changes may be necessary in the provisions of the Supplemental
Remarketing Agreement due to changes in law or facts and circumstances or in the
event that Xxxxxx Xxxxxxx is not the sole remarketing agent, and with such
further changes therein as the Remarketing Agent may reasonably request), or
(ii) in such other form as the Remarketing Agent may reasonably request, subject
to the approval of the Company and Duke Capital (such approval not to be
unreasonably withheld). Anything herein to the contrary notwithstanding, to the
extent that the parties hereto are unable to agree on the form or substance of
the Supplemental Remarketing Agreement, Xxxxxx Xxxxxxx shall not act as
Remarketing Agent or Reset Agent hereunder. The Company and Duke Capital agree
that Xxxxxx Xxxxxxx shall have the right, on 15 Business Days notice to the
Company and Duke Capital, to appoint one or more additional remarketing agents
so long as any such additional remarketing agents shall be reasonably acceptable
to the Company and Duke Capital. Upon any such appointment, the parties shall
enter into an appropriate amendment to this Agreement to reflect the addition of
any such remarketing agent.
(b) Pursuant to the Supplemental Remarketing Agreement, the
Remarketing Agent, either as sole remarketing agent or as representative of a
group of remarketing agents appointed as aforesaid, will agree, subject to the
terms and conditions set forth herein and therein, to use its reasonable efforts
to (i) remarket, on the Initial Remarketing Date, the Senior Notes that the
Purchase Contract Agent and the Custodial Agent shall have notified the
Remarketing Agent have been tendered for, or otherwise are to be included in,
the Initial Remarketing, at a price per Senior Note such that the aggregate
price for the Applicable Principal Amount of the Senior Notes is approximately
100.5% of the Treasury Portfolio Purchase Price and (ii) in the event of a
Failed Initial Remarketing, remarket, on the third Business Day immediately
preceding the Purchase Contract Settlement Date, the Senior Notes that the
Purchase Contract Agent and the Custodial Agent shall have notified the
Remarketing Agent have been tendered for, or otherwise are to be included in,
the Secondary Remarketing, at a price of approximately 100.5% of the aggregate
principal amount of such Senior Notes. Notwithstanding the preceding sentence,
the
4
Remarketing Agent shall not remarket any Senior Notes for a price less than the
price (the "Minimum Initial Remarketing Price") necessary for the Applicable
Principal Amount of the Senior Notes to have an aggregate price equal to 100% of
the Treasury Portfolio Purchase Price, in the case of the Initial Remarketing,
or the aggregate principal amount of such Senior Notes, in the case of the
Secondary Remarketing. After deducting the fee specified in Section 3 below, the
proceeds of such Initial Remarketing or Secondary Remarketing, as the case may
be, shall be paid to the Collateral Agent in accordance with Section 4.6 or 6.3
of the Pledge Agreement and Section 5.3A or 5.4 of the Purchase Contract
Agreement (each of which Sections are incorporated herein by reference).
(c) It is understood and agreed that neither the Remarketing Agent
nor the Reset Agent shall have any obligation whatsoever to purchase any Senior
Notes, whether in the Initial Remarketing, Secondary Remarketing or otherwise,
and shall in no way be obligated to provide funds to make payment upon tender of
Senior Notes for remarketing or to otherwise expend or risk their own funds or
incur or be exposed to financial liability in the performance of their
respective duties under this Agreement or the Supplemental Remarketing
Agreement, and, without limitation of the foregoing, the Remarketing Agent shall
not be deemed an underwriter of the remarketed Senior Notes. The Company and
Duke Capital shall not be obligated in any case to provide funds to make payment
upon tender of Senior Notes for remarketing.
(d) The Remarketing Agent agrees to give the notices required by
Sections 301(g) and (h) and 302 (h) and (i) of the Third Supplemental Indenture.
Section 3. Fees. In the event of a Successful Initial Remarketing,
----
the Remarketing Agent shall retain as a remarketing fee (the "Remarketing Fee")
an amount not exceeding 25 basis points (0.25%) of the Minimum Initial
Remarketing Price from any amount received in connection with such Initial
Remarketing in excess of the Minimum Initial Remarketing Price. In the event of
a Successful Secondary Remarketing, the Remarketing Agent shall retain as the
Remarketing Fee an amount not exceeding 25 basis points (0.25%), of the
principal amount of the remarketed Senior Notes from any amount received in
connection with such Secondary Remarketing in excess of the aggregate principal
amount of such re marketed Senior Notes. In addition, the Reset Agent shall, in
either case, receive from the Company a reasonable and customary fee (the "Reset
Agent Fee"); provided, however, that if the Remarketing Agent shall also act as
the Reset Agent, then the Reset Agent shall not be entitled to receive any such
Reset Agent Fee. Payment of such Reset Agent Fee shall be made by the Company on
the Initial
5
Remarketing Date, in the case of a Successful Initial Remarketing, or on the
third Business Day immediately preceding the Purchase Contract Settlement Date,
in the case of a Successful Secondary Remarketing, in immediately available
funds or, upon the instructions of the Reset Agent, by certified or official
bank check or checks or by wire transfer.
Section 4. Replacement and Resignation of Remarketing Agent. (a) The
------------------------------------------------
Company and Duke Capital may at any time in their absolute discretion replace
Xxxxxx Xxxxxxx as the Remarketing Agent and as the Reset Agent hereunder
pursuant to a 45 days' prior written notice to Xxxxxx Xxxxxxx, provided, that
the Company and Duke Capital must replace Xxxxxx Xxxxxxx both as Remarketing
Agent and as Reset Agent unless Xxxxxx Xxxxxxx shall otherwise agree. Any such
replacement shall become effective upon the Company and Duke Capital's appoint
ment of a successor to perform the services that would otherwise be performed
hereunder by the Remarketing Agent and the Reset Agent. Upon providing such
notice, the Company and Duke Capital shall use all reasonable efforts to appoint
such a successor and to enter into a remarketing agreement with such successor
as soon as reasonably practicable.
(b) Xxxxxx Xxxxxxx may resign at any time and be discharged from its
duties and obligations hereunder as the Remarketing Agent and/or as the Reset
Agent pursuant to a 45 days' prior written notice to the Company. Any such
resignation shall become effective upon the Company and Duke Capital's
appointment of a successor to perform the services that would otherwise be
performed hereunder by the Remarketing Agent and/or the Reset Agent. Upon
receiving notice from the Remarketing Agent and/or the Reset Agent that it
wishes to resign hereunder, the Company and Duke Capital shall appoint such a
successor and enter into a remarketing agreement with it as soon as reasonably
practicable.
(c) The Company and Duke Capital shall give the Purchase Contract
Agent, the Trustee, the Collateral Agent and the Custodial Agent prompt written
notice of the appointment of any successor Remarketing Agent and Reset Agent.
Section 5. Dealing in the Securities. Each of the Remarketing Agent
-------------------------
and the Reset Agent, when acting hereunder or, in the case of the Remarketing
Agent, under the Supplemental Remarketing Agreement, or when acting in its
individual or any other capacity, may, to the extent permitted by law, buy,
sell, hold or deal in any of the Senior Notes,
6
Treasury Units, Corporate Units or any other securities of the Company or Duke
Capital. With respect to any Senior Notes, Treasury Units, Corporate Units or
any other securities of the Company or Duke Capital owned by it, each of the
Remarketing Agent and the Reset Agent may exercise any vote or join in any
action with like effect as if it did not act in any capacity hereunder. Each of
the Remarketing Agent and the Reset Agent, in its individual capacity, either as
principal or agent, may also engage in or have an interest in any financial or
other transaction with the Company or Duke Capital as freely as if it did not
act in any capacity hereunder.
Section 6. Registration Statement and Prospectus. In connection with
-------------------------------------
the Initial Remarketing, if and to the extent required in the opinion of counsel
(which need not be a formal written opinion) for each of the Remarketing Agent
and the Company and Duke Capital by applicable law, regulations or
interpretations in effect at the time of such Initial Remarketing, the Company
and Duke Capital (i) shall use their reasonable efforts to have a registration
statement relating to the Senior Notes effective under the Securities Act of
1933 prior to the third Business Day immediately preceding _____________, 2004,
(ii) if requested by the Remarketing Agent shall furnish a current preliminary
prospectus and, if applicable, a current preliminary prospectus supplement to be
used by the Remarketing Agent in the Initial Remarketing not later than seven
Business Days prior to ____________, 2004 (or such earlier date as the
Remarketing Agent may reasonably request) and in such quantities as the
Remarketing Agent may reasonably request, and (iii) shall furnish a current
final prospectus and, if applicable, a final prospectus supplement to be used by
the Remarketing Agent in the Initial Remarketing not later than the third
Business Day immediately preceding ____________, 2004 in such quantities as the
Remarketing Agent may reasonably request, and shall pay all expenses relating
thereto. In the event of a Failed Initial Remarketing and in connection with the
Secondary Remarketing, if and to the extent required in the opinion of counsel
(which need not be a formal written opinion) for each of the Remarketing Agent
and the Company and Duke Capital by applicable law, regulations or
interpretations in effect at the time of such Secondary Remarketing, the Company
and Duke Capital (i) shall use their reasonable efforts to have a registration
statement relating to the Senior Notes effective under the Securities Act of
1933 prior to the third Business Day immediately preceding the Purchase Contract
Settlement Date, (ii) if requested by the Remarketing Agent, shall furnish a
current preliminary prospectus and, if applicable, a current preliminary
prospectus supplement to be used by the Remarketing Agent in the Secondary
Remarketing not later than seven Business Days prior to the Purchase Contract
Settlement Date (or such earlier date as the Remarketing Agent may reasonably
request) and in such quantities as the Remarketing Agent may reasonably request,
and (iii) shall furnish a current final prospectus and, if applicable, a final
prospectus supplement to be used by the
7
Remarketing Agent in the Secondary Remarketing not later than the third Business
Day immediately preceding the Purchase Contract Settlement Date in such
quantities as the Remarketing Agent may reasonably request, and shall pay all
expenses relating thereto. The Company and Duke Capital shall also take all such
actions as may (upon advice of counsel to each of the Company and Duke Capital
and the Remarketing Agent) be necessary or desirable under state securities or
blue sky laws in connection with the Initial Remarketing and the Secondary
Remarketing.
Section 7. Conditions to the Remarketing Agent's Obligations. (a) The
-------------------------------------------------
obligations of the Remarketing Agent and the Reset Agent under this Agreement
and, in the case of the Remarketing Agent, the Supplemental Remarketing
Agreement shall be subject to the terms and conditions of this Agreement and the
Supplemental Remarketing Agreement, including, without limitation, the following
conditions: (i) the Senior Notes tendered for, or otherwise to be included in
the Initial Remarketing or Secondary Remarketing, as the case may be, have not
been called for redemption, (ii) the Remarketing Agent is able to find a
purchaser or purchasers for tendered Senior Notes (1) in the case of the Initial
Remarketing, at a price not less than Minimum Initial Remarketing Price, and (2)
in the case of the Secondary Remarketing, at a price not less than 100% of the
principal amount thereof, (iii) the Purchase Contract Agent, the Collateral
Agent, the Custodial Agent, the Company, Duke Capital and the Trustee shall have
performed their respective obligations in connection with the Initial
Remarketing and, in the event of a Failed Initial Remarketing, in connection
with the Secondary Remarketing, in each case pursuant to the Purchase Contract
Agreement, the Pledge Agreement, the Indenture, this Agreement and the
Supplemental Remarketing Agreement (including, without limitation, giving the
Remarketing Agent notice of the Treasury Portfolio Purchase Price no later than
10:00 a.m., New York City time, on the fourth Business Day prior to
____________, 2004, in the case of the Initial Remarketing, and giving the
Remarketing Agent notice of the aggregate principal amount, as the case may be,
of Senior Notes to be remarketed, no later than 10:00 a.m., New York City time,
on the fourth Business Day prior to the Purchase Contract Settlement Date, in
the case of the Secondary Remarketing, and, in each case, concurrently
delivering the Senior Notes to be remarketed to the Remarketing Agent), (iv) no
Event of Default (as defined in the Indenture) shall have occurred and be
continuing, (v) the accuracy of the representations and warranties of the
Company and Duke Capital included and incorporated by reference in this
Agreement and the Supplemental Remarketing Agreement or in certificates of any
officer of the Company, Duke Capital or any of their subsidiaries delivered
pursuant to the provisions included or incorporated by reference in this
Agreement or the Supplemental Remarketing Agreement, (vi) the performance by the
Company and Duke Capital of their covenants and other
8
obligations included and incorporated by reference in this Agreement and the
Supplemental Remarketing Agreement, and (vii) the satisfaction of the other
conditions set forth and incorporated by reference in this Agreement and the
Supplemental Remarketing Agreement.
(b) If at any time during the term of this Agreement, any Event of
Default (as defined in the Indenture) has occurred and is continuing under the
Indenture, or the occurrence of an Event of Default is imminent, then the
obligations and duties of the Remarketing Agent and the Reset Agent under this
Agreement and the Supplemental Remarketing Agreement shall be suspended until
such default or imminent condition has been cured or eliminated, as the case may
be. The Company and Duke Capital will promptly give the Remarketing Agent
notice of all defaults and events referred to above of which the Company or Duke
Capital is aware.
Section 8. Termination of Remarketing Agreement. This Agreement shall
------------------------------------
terminate as to any Remarketing Agent or Reset Agent which is replaced on the
effective date of its replacement pursuant to Section 4(a) hereof or pursuant to
Section 4(b) hereof. Notwithstanding any such termination, the obligations set
forth in Section 3 hereof shall survive and remain in full force and effect
until all amounts payable under said Section 3 shall have been paid in full. In
addition, each former Remarketing Agent and Reset Agent shall be entitled to the
rights and benefits under Section 10 of this Agreement notwithstanding the
replacement or resignation of such Remarketing Agent or Reset Agent
Section 9. Remarketing Agent's Performance; Duty of Care. The duties
---------------------------------------------
and obligations of the Remarketing Agent and the Reset Agent shall be determined
solely by the express provisions of this Agreement and, in the case of the
Remarketing Agent, the Supplemental Remarketing Agreement. No implied covenants
or obligations of or against the Remarketing Agent or the Reset Agent shall be
read into this Agreement or the Supplemental Remarketing Agreement. In the
absence of bad faith on the part of the Remarketing Agent or the Reset Agent, as
the case may be, the Remarketing Agent and the Reset Agent each may conclusively
rely upon any document furnished to it which purports to conform to the
requirements of this Agreement or the Supplemental Remarketing Agreement, as the
case may be, as to the truth of the statements expressed therein. Each of the
Remarketing Agent and the Reset Agent shall be protected in acting upon any
document or communication reasonably believed by it to be signed, presented or
made by the proper party or parties. Neither the Remarketing Agent nor the Reset
Agent shall have any obligation to determine whether there is any limitation
under applicable law on the Reset Rate on the Senior Notes or, if there is any
such
9
limitation, the maximum permissible Reset Rate on the Senior Notes, and they
shall rely solely upon written notice from the Company and Duke Capital (which
the Company and Duke Capital agree to provide prior to the tenth Business Day
before __________, 2004, in the case of the Initial Remarketing, and prior to
the tenth Business Day before Purchase Contract Settlement Date, in the case of
the Secondary Remarketing) as to whether or not there is any such limitation
and, if so, the maximum permissible Reset Rate. Neither the Remarketing Agent
nor the Reset Agent shall incur any liability under this Agreement or the
Supplemental Remarketing Agreement to any beneficial owner or holder of Senior
Notes, or other securities, either in its individual capacity or as Remarketing
Agent or Reset Agent, as the case may be, for any action or failure to act in
connection with the Remarketing or otherwise in connection with the transactions
contemplated by this Agreement or the Supplemental Remarketing Agreement. The
provisions of this Section 9 shall survive any termination of this Agreement and
shall also continue to apply to every Remarketing Agent and Reset Agent
notwithstanding their resignation or removal.
Section 10. Indemnification and Contribution. (a) The Company and
--------------------------------
Duke Capital, jointly and severally, agrees to indemnify and hold harmless the
Remarketing Agent, the Reset Agent and their respective directors, officers,
employees, agents, affiliates and each person, if any, who controls the
Remarketing Agent or the Reset Agent within the meaning of either Section 15 of
the Securities Act of 1933, as amended (the "1933 Act"), or Section 20 of the
Securities Exchange Act of 1934, as amended (the "1934 Act") (the Remarketing
Agent, the Reset Agent and each such person or entity being an "Indemnified
Party"), as discussed below, provided that any such indemnification shall be
payable only in connection with any loss, claim, damage liability or expense
which has been incurred or suffered by the relevant Indemnified Party in
connection with the Remarketing Agent or the Reset Agent performing its
obligations and responsibilities hereunder and any acts incidental thereto:
(i) from and against any and all losses, claims, damages,
liabilities and expenses whatsoever, joint or several, as incurred, to which
such Indemnified Party may become subject under any applicable federal or state
law, or otherwise, and related to, arising out of, or based on (A) the failure
to have an effective Registration Statement (as defined in the Supplemental
Remarketing Agreement) under the 1933 Act relating to the Senior Notes, as the
case may be, if required, or the failure to satisfy the prospectus delivery
requirements of the 1933 Act because the Company or Duke Capital failed to
provide the Remarketing Agent with a Prospectus (as defined in the Supplemental
Remarketing Agreement) for
10
delivery, or (B) any untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement or any amendment thereto (including
any information deemed to be a part of the Registration Statement at the time it
became effective pursuant to paragraph (b) of Rule 430A under the 1933 Act, if
applicable), 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 (C) any untrue statement or alleged untrue statement of a
material fact contained in any preliminary prospectus or the 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, or (D)
any untrue statement or alleged untrue statement of a material fact contained in
any other information (whether oral or written) or documents (including, without
limitation, any documents incorporated or deemed to be incorporated by reference
in any such information or documents) provided by the Company for use in
connection with the remarketing of the Senior Notes or any of the transactions
related thereto, or (E) any breach by the Company or Duke Capital of any of the
representations, warranties or agreements included or incorporated by reference
in this Agreement or the Supplemental Remarketing Agreement, or (F) any failure
by the Company or Duke Capital to make or consummate the remarketing of the
Senior Notes (including, without limitation, any Failed Initial Remarketing or
Failed Secondary Remarketing) or the withdrawal, recession, termination,
amendment or extension of the terms of such remarketing, or (G) any failure on
the part of the Company or Duke Capital to comply, or any breach by the Company
of, any of the provisions included or incorporated by reference in this
Agreement, the Supplemental Remarketing Agreement, the Purchase Contract
Agreement, the Corporate Units, the Treasury Units, the Pledge Agreement, the
Indenture or the Senior Notes (collectively, the "Operative Documents") or (H)
the remarketing of the Senior Notes, as the case may be, or any other
transaction contemplated by any of the Operative Documents, or the engagement of
the Remarketing Agent or the Reset Agent pursuant to, or the performance by the
Remarketing Agent or the Reset Agent of the respective services contemplated by,
this Agreement or the Supplemental Remarketing Agreement, whether or not the
Initial Remarketing or the Secondary Remarketing or the reset of the interest
rate on the Senior Notes as contemplated herein actually occur;
(ii) against any and all loss, liability, claim, damage and expense
whatsoever, to the extent of the aggregate amount paid in settlement of any
litigation, commenced or threatened, or of any claim whatsoever related to, or
based on any untrue statement or omission on any alleged untrue statement or
omission
11
described in clause (i) above if such settlement is effected with the written
consent of the Company and Duke Capital; and
(iii) against any and all expense whatsoever, reasonably incurred
in investigating, preparing or defending against any litigation, commenced or
threatened, or any claim whatsoever related to, based on any untrue statement or
omission on any alleged untrue statement or omission described in clause (i)
above, to the extent that any such expense is not paid under clause (i) or (ii)
above;
provided, however, that the Company and Duke Capital shall not be liable under
clause (i) with respect to any claim made against any Indemnified Party or
Parties unless the Company and Duke Capital shall be notified in writing of the
nature of the claim within a reasonable time after the assertion thereof, but
failure so to notify the Company and Duke Capital shall not relieve it from any
liability which it may have otherwise than on account of this Section 10. The
Company and Duke Capital shall be entitled to participate at their own expense
in the defense, or, if it so elects, within a reasonable time after receipt of
such notice, to assume the defense shall be conducted by counsel chosen by it
and approved by the Indemnified Party or Parties or, defendant or defendants in
any suit so brought, which approval shall not be unreasonably withheld. In any
such suit, any Indemnified Party shall have the right to employ its own counsel,
but the fees and expenses of such counsel shall be at the expense of such
Indemnified Party unless (i) the Company and Duke Capital and such Indemnified
Party shall have mutually agreed to the employment of such counsel, or (ii) the
named parties to any such action (including any impleaded parties) include both
such Indemnified Party and the Company and Duke Capital and such Indemnified
Party shall have been advised by such counsel that a conflict of interest
between the Company and Duke Capital and such Indemnified Party may arise and
for this reason it is not desirable for the same counsel to represent both the
indemnifying party and also the Indemnified Party (it being understood, however,
that the Company and Duke Capital shall not, in connection with any one such
action or separate but substantially similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances, be
liable for the reasonable fees and expenses of more than one separate firm of
attorneys for all such Indemnified Parties).
(b) The Remarketing Agent agrees that it will indemnify and hold
harmless the Company and Duke Capital, their directors and each of the officers
of the Company and Duke Capital who signed the respective Registration
Statements and each Person, if any, who controls the Company and Duke Capital
within the meaning of Section 15 of the 1933 Act to the same extent as the
indemnity contained
12
in subsection (a) of this Section, but only with respect to statements or
omissions made in the Registration Statements (or any amendment thereto) or any
Preliminary Prospectus, such prospectus or the Prospectus (or any amendment or
supplement thereto) in reliance upon and in conformity with written information
furnished to the Company and Duke Capital by the Remarketing Agent expressly for
use in the Registration Statements (or any amendment thereto), such Preliminary
Prospectus, such prospectus or the Prospectus (or any amendment or supplement
thereto). In case any action shall be brought against the Company and Duke
Capital or any Person so indemnified based on the Registration Statements (or
any amendment thereto) or such Preliminary Prospectus, such prospectus or the
Prospectus (or any amendment or supplement thereto) and in respect of which
indemnity may be sought against the Remarketing Agent, shall have the rights and
duties given to the Company and Duke Capital, and the Company and Duke Capital
and each Person so indemnified shall have the rights and duties given to the
Indemnified Parties, by the provisions of subsection (a) of this Section.
(c) No indemnifying party shall, without the prior written consent of
the indemnified party, effect any settlement of any pending or threatened
proceeding in respect of which any indemnified party is or could have been a
party and indemnity could have been sought hereunder by such indemnified party,
unless such settlement includes an unconditional release of such indemnified
party from all liability on claims that are the subject matter of such
proceeding.
(d) If the indemnification provided for in this Section 10 is
unavailable to or insufficient to hold harmless an indemnified party in respect
of any and all loss, liability, claim, damage and expense whatsoever (or actions
in respect thereof) that would otherwise have been indemnified under the terms
of such indemnity, then each indemnifying party shall contribute to the amount
paid or payable by such indemnified party as a result of such loss, liability,
claim, damage or expense (or actions in respect thereof) in such proportion as
is appropriate to reflect the relative benefits received by the Company and Duke
Capital on the one hand and the Remarketing Agent on the other from the
Remarketing offering of the Units. If, however, the allocation provided by the
immediately preceding sentence is not permitted by applicable law or if the
indemnified party failed to give the notice required above, then each
indemnifying party shall contribute to such amount paid or payable by such
indemnified party in such proportion as is appropriate to reflect not only such
relative benefits but also the relative fault of the Company and Duke Capital on
the one hand and the Remarketing Agent on the other in connection with the
statements or omissions which resulted in such losses, liability, claim, damage
or expense (or actions in respect thereof), as well as any other relevant equity
13
considerations. The relative benefits received by the Company and Duke Capital
on the one hand and the Remarketing Agent on the other shall be deemed to be in
the same proportion as the total net proceeds from the remarketing (before
deducting expenses) received by Duke Capital bear to the total compensation
received by the Remarketing Agent in respect of the Remarketing. The relative
fault shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the Company
and Duke Capital on the one hand or the Remarketing Agent on the other and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. The Company and Duke Capital and
the Remarketing Agent agree that it would not be just and equitable if
contributions pursuant to this section were determined by pro rata allocation or
by any other method of allocation which does not take account of the equitable
considerations referred to above in this section. The amount paid or payable by
an indemnified party as a result of the losses, liabilities, claims, damages or
expenses (or actions in respect thereof) referred to above in this section shall
be deemed to include any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such action
or claim. Notwithstanding the provisions of this Section 10, the Remarketing
Agent shall not be required to contribute any amount in excess of the amount by
which the aggregate stated amount of the Senior Notes which were remarketed
exceeds the amount of any damages which the Remarketing Agent has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the 0000 Xxx) shall be entitled to contribution
from any person who was not guilty of such fraudulent misrepresentation.
(e) Anything herein or in the Supplemental Remarketing Agreement to
the contrary notwithstanding, the provisions of this Section 10, and the rights
of the Remarketing Agent, the Reset Agent and the other Indemnified Parties
hereunder, shall be in addition to, and not in limitation of, any rights or
benefits (including, without limitation, rights to indemnification or
contribution) which the Remarketing Agent, the Reset Agent or any other
Indemnified Party may have under any other instrument or agreement.
Section 11. Governing Law. This Agreement shall be governed by and
-------------
construed in accordance with the laws of the State of New York without regard to
principles of conflicts of laws.
14
Section 12. Term of Agreement. (a) Unless otherwise terminated in
-----------------
accordance with the provisions hereof and except as otherwise provided herein,
this Agreement shall remain in full force and effect from the date hereof until
the first day thereafter on which no Senior Notes are outstanding, or, if
earlier, the Business Day immediately following ___________, 2004, in the case
of a Successful Initial Remarketing, or the Business Day immediately following
the Purchase Contract Settlement Date, in the case of a Successful Secondary
Remarketing. Anything herein to the contrary notwithstanding, the provisions of
the last sentence of Section 8 hereof and the provisions of Sections 3, 9, 10
and 12(b) hereof shall survive any termination of this Agreement and remain in
full force and effect.
(b) All representations and warranties included or incorporated by
reference in this Agreement, or the Supplemental Remarketing Agreement, or
contained in certificates of officers of the Company or Duke Capital submitted
pursuant hereto or thereto, shall remain operative and in full force and effect,
regardless of any investigation made by or on behalf of the Remarketing Agent,
the Reset Agent or any of their controlling persons, or by or on behalf of the
Company, Duke Capital or the Purchase Contract Agent, and shall survive the
remarketing of the Senior Notes.
Section 13. Successors and Assigns. The rights and obligations of
----------------------
the Company, Duke Capital and the Purchase Contract Agent (both in its capacity
as Purchase Contract Agent and as attorney-in-fact) hereunder may not be
assigned or delegated to any other person without the prior written consent of
the Remarketing Agent and the Reset Agent, except, with respect to the Purchase
Contract Agent, in connection with the appointment of a successor thereto
pursuant to the Purchase Contract Agreement. The rights and obligations of the
Remarketing Agent and the Reset Agent hereunder may not be assigned or delegated
to any other person without the prior written consent of the Company and Duke
Capital, except that the Remarketing Agent shall have the right to appoint
additional remarketing agents as provided herein. This Agreement shall inure to
the benefit of and be binding upon the Company, Duke Capital, the Purchase
Contract Agent, the Remarketing Agent and the Reset Agent and their respective
successors and assigns and the other Indemnified Parties (as defined in Section
10 hereof) and the successors, assigns, heirs and legal representatives of the
Indemnified Parties. The terms "successors" and "assigns" shall not include any
purchaser of Securities or Senior Notes merely because of such purchase.
Section 14. Headings. Section headings have been inserted in this
--------
Agreement and the Supplemental Remarketing Agreement as a matter of
15
convenience of reference only, and it is agreed that such section headings are
not a part of this Agreement or the Supplemental Remarketing Agreement and will
not be used in the interpretation of any provision of this Agreement or the
Supplemental Remarketing Agreement.
Section 15. Severability. If any provision of this Agreement or
------------
the Supplemental Remarketing Agreement shall be held or deemed to be or shall,
in fact, be invalid, inoperative or unenforceable as applied in any particular
case in any or all jurisdictions because it conflicts with any provisions of any
constitution, statute, rule or public policy or for any other reason, then, to
the extent permitted by law, such circumstances shall not have the effect of
rendering the provision in question invalid, inoperative or unenforceable in any
other case, circumstances or jurisdiction, or of rendering any other provision
or provisions of this Agreement or the Supplemental Remarketing Agreement, as
the case may be, invalid, inoperative or unenforceable to any extent whatsoever.
Section 16. Counterparts. This Agreement and the Supplemental
------------
Remarketing Agreement may be executed in counterparts, each of which shall be
regarded as an original and all of which shall constitute one and the same
document.
Section 17. Amendments. This Agreement and the Supplemental
----------
Remarketing Agreement may be amended by any instrument in writing signed by the
parties hereto. The Company, Duke Capital and the Purchase Contract Agent agree
that they will not enter into, cause or permit any amendment or modification of
the Purchase Contract Agreement, the Third Supplemental Indenture, the Pledge
Agreement, the Senior Notes, the Equity Units or any other instruments or
agreements relating to the Senior Notes or the Equity Units which would
materially and adversely affect the rights, duties or obligations of the
Remarketing Agent or the Reset Agent without the prior written consent of the
Remarketing Agent or the Reset Agent, as the case may be.
Section 18. Notices. Unless otherwise specified, any notices,
-------
requests, consents or other communications given or made hereunder or pursuant
hereto shall be made in writing or transmitted by any standard form of
telecommunication, including telephone or telecopy, and confirmed in writing.
All written notices and confirmations of notices by telecommunication shall be
deemed to have been validly given or made when delivered or mailed, registered
or certified mail, return receipt requested and postage prepaid. All such
notices, requests, consents or other communications shall be addressed as
follows: if to the Company or Duke Capital, to Duke Energy Corporation, 000
Xxxxx Xxxxxx Xxxxxx, Xxxxxxxxx,
00
Xxxxx Xxxxxxxx 00000, Attention: Chief Financial Officer, with a copy to Xxxxx
Xxxxxxxxxx LLP, 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, XX 00000, Attention: Xxxx
Xxxxxxx; if to the Remarketing Agent or Reset Agent, to Xxxxxx Xxxxxxx, 0000
Xxxxxxxx, Xxx Xxxx, XX 00000, Attention: _________, with a copy to Skadden,
Arps, Slate, Xxxxxxx & Xxxx LLP, Xxxx Xxxxx Xxxxxx, Xxx Xxxx, XX 00000,
Attention: Xxxx X. Xxxxxx; and if to the Purchase Contract Agent, to The Chase
Manhattan Bank, 000 Xxxx 00xx Xxxxxx, Xxx Xxxx, XX 00000, Attention:
Institutional Trust Services, or to such other address as any of the above shall
specify to the other in writing.
Section 19. Information. The Company and Duke Capital agree to
-----------
furnish the Remarketing Agent and the Reset Agent with such information and
documents as the Remarketing Agent or the Reset Agent may reasonably request in
connection with the transactions contemplated by this Remarketing Agreement and
the Supplemental Remarketing Agreement, and make reasonably available to the
Remarketing Agent, the Reset Agent and any accountant, attorney or other advisor
retained by the Remarketing Agent or the Reset Agent such information that
parties would customarily require in connection with a due diligence
investigation conducted in accordance with applicable securities laws and cause
the Company's and Duke Capital's officers, directors, employees and accountants
to participate in all such discussions and to supply all such information
reasonably requested by any such person in connection with such investigation.
17
IN WITNESS WHEREOF, each of the Company, Duke Capital, the Purchase
Contract Agent and the Remarketing Agent has caused this Agreement to be
executed in its name and on its behalf by one of its duly authorized signatories
as of the date first above written.
DUKE ENERGY CORPORATION
By: _____________________________
Name:
Title:
DUKE CAPITAL CORPORATION
By: _____________________________
Name:
Title:
CONFIRMED AND ACCEPTED:
XXXXXX XXXXXXX & CO.
INCORPORATED
By: ______________________________
Authorized Signatory
THE CHASE MANHATTAN BANK
not individually but solely as Purchase Contract
Agent and as attorney-in-fact for the holders of
the Purchase Contracts
By :______________________________
Name:
Title:
Exhibit A to
Remarketing Agreement
---------------------
Form of Supplemental Remarketing Agreement
Supplemental Remarketing Agreement dated _____________, ____ among Duke
Energy Corporation, a North Carolina corporation (the "Company"), Duke Capital
Corporation, a Delaware corporation and wholly owned subsidiary of the Company
("Duke Capital"), Xxxxxx Xxxxxxx & Co. Incorporated (the "Remarketing Agent"),
and The Chase Manhattan Bank, as Purchase Contract Agent and attorney-in-fact
for the Holders of the Purchase Contracts (as such terms are defined in the
Purchase Contract Agreement referred to in Schedule I hereto)
NOW, THEREFORE, for and in consideration of the covenants herein made, and
for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto agree as follows:
1. Definitions. Capitalized terms used and not defined in this
-----------
Agreement shall have the meanings assigned to them in the Remarketing Agreement
dated as of March __, 2001 (the "Remarketing Agreement") among the Company, Duke
Capital, the Purchase Contract Agent and Xxxxxx Xxxxxxx & Co. Incorporated or,
if not defined in the Remarketing Agreement, the meanings assigned to them in
the Purchase Contract Agreement (as defined in Schedule I hereto).
2. Registration Statement and Prospectus. Duke Capital has filed with
-------------------------------------
the Securities and Exchange Commission, and there has become effective, a
registration statement on Form S-3, including a prospectus, relating to the
Securities (as such term is defined on Schedule I hereto). Such Registration
Statement, as amended, and including the information deemed to be a part thereof
pursuant to Rule 430A under the Securities Act of 1933, as amended (the "1933
Act"), and the documents incorporated or deemed to be incorporated by reference
therein, are hereinafter called, collectively, the "Registration Statement"; the
related preliminary prospectus dated March 2, 2001, including the documents
incorporated or deemed to be incorporated by reference therein, [and preliminary
prospectus supplemented dated __________] are hereinafter called, [collectively]
the "preliminary prospectus";] and the related prospectus dated ______________,
including the documents incorporated or deemed to be incorporated by reference
therein, [and prospectus supplement dated _______________] are hereinafter
called, [collectively,] the "Prospectus." The Company and Duke Capital have
provided copies of the Registration Statement
[, the preliminary prospectus] and the Prospectus to the Remarketing Agent, and
hereby consents to the use of the [preliminary prospectus] and the Prospectus in
connection with the remarketing of the Securities. [In the event that a
Registration Statement is not required, insert the following: The Company and
Duke Capital have provided to the Remarketing Agent, for use in connection with
remarketing of the Securities (as such term is defined on Schedule I hereto), a
[preliminary remarketing memorandum and] remarketing memorandum and [describe
other materials, if any]. Such remarketing memorandum (including the documents
incorporated or deemed to be incorporated by reference therein, [and] [describe
other materials] are hereinafter called, collectively, the "Prospectus," [and
such preliminary marketing memorandum (including the documents incorporated or
deemed to be incorporated by reference therein) is hereinafter called a
"preliminary prospectus")]. The Company and Duke Capital hereby consent to the
use of the Prospectus [and the preliminary prospectus] in connection with the
remarketing of the Securities]. All references in this Agreement to amendments
or supplements to the Registration Statement [, the preliminary prospectus] or
the Prospectus shall be deemed to mean and include the filing of any document
under the Securities Exchange Act of 1934, as amended (the "1934 Act"), which is
incorporated or deemed to be incorporated by reference in the Registration
Statement [, the preliminary prospectus] or the Prospectus, as the case may be.
3. Provisions Incorporated by Reference.
------------------------------------
(a) Subject to Section 3(b) hereof, the provisions of the
Underwriting Agreement (other than Section 1, Section 3, Section 4, Section 5,
Section 8 and Section 9 thereof) are incorporated herein by reference, mutatis
mutandis, and the Company and Duke Capital hereby make the representations and
warranties, and agrees to comply with the covenants and obligations, set forth
in the provisions of the Underwriting Agreement incorporated by reference
herein, as modified by the provisions of Section 3(b) hereof.
(b) With respect to the provisions of the Underwriting Agreement
incorporated herein, for the purposes hereof, (i) all references therein to the
"Underwriter" or "Underwriters" shall be deemed to refer to the Remarketing
Agent and all references to the "Representative" or the "Representatives" shall
be deemed to refer to Xxxxxx Xxxxxxx & Co. Incorporated ("Xxxxxx Xxxxxxx"); (ii)
all references therein to the "Units" or "Firm Units" shall be deemed to refer
to the Securities as defined herein; (iii) all references therein to the "Time
of Delivery" shall be deemed to refer to the Remarketing Closing Date specified
in Schedule I hereto; (iv) all references therein to the "Registration
Statement", the "Preliminary Prospectus" or
A-2
the "final prospectus" shall be deemed to refer to the Registration Statement[,
the preliminary prospectus] and the Prospectus, respectively, as defined herein;
(v) all references therein to this "Agreement," the "Underwriting Agreement,"
"hereof," "herein" and all references of similar import, shall be deemed to mean
and refer to this Supplemental Remarketing Agreement; (vi) all references
therein to "the date hereof," "the date of this Agreement" and all similar
references shall be deemed to refer to the date of this Supplemental Remarketing
Agreement; (vii) all references therein to any "settlement date" shall be
disregarded; and (viii) [other changes].]
4. Remarketing. Subject to the terms and conditions and in reliance
-----------
upon the representations and warranties herein set forth or incorporated by
reference herein and in the Remarketing Agreement, the Remarketing Agent agrees
to use its reasonable efforts to remarket, in the manner set forth in Section
2(b) of the Remarketing Agreement, the aggregate principal amount, as the case
may be, of Securities set forth in Schedule I hereto at a purchase price not
less than 100% of the [Minimum Initial Remarketing Price] [aggregate principal
amount of the Securities]. In connection therewith, the registered holder or
holders thereof agree, in the manner specified in Section 5 hereof, to pay to
the Remarketing Agent a Remarketing Fee equal to an amount not exceeding 25
basis points (0.25%) of [the Minimum Initial Remarketing Price] [such aggregate
principal amount,] payable by deduction from any amount received in connection
from such [Initial][Secondary] Remarketing in excess of the [Minimum Initial
Remarketing Price] [aggregate principal amount of the Securities]. Pursuant to
the Third Supplemental Indenture, right of each holder of Securities to have
Securities tendered for purchase shall be limited to the extent set forth in the
last sentence of Section 2(b) of the Remarketing Agreement (which is
incorporated by reference herein). As more fully provided in Section 2(c) of
the Remarketing Agreement (which is incorporated by reference herein), the
Remarketing Agent is not obligated to purchase any Securities in the remarketing
or otherwise, and neither the Company nor the Remarketing Agent shall be
obligated in any case to provide funds to make payment upon tender of Securities
for remarketing.
5. Delivery and Payment. Delivery of payment for the remarketed
--------------------
Securities by the purchasers thereof identified by the Remarketing Agent and
payment of the Remarketing Fee shall be made on the Remarketing Closing Date at
the location and time specified in Schedule I hereto (or such later date not
later than five Business Days after such date as the Remarketing Agent shall
designate), which date and time may be postponed by agreement between the
Remarketing Agent and the Company and Duke Capital. Delivery of the remarketed
Securities and payment of the Remarketing Fee shall be made to the Remarketing
Agent against payment by
A-3
the respective purchasers of the remarketed Securities of the consideration
therefor as specified herein, which consideration shall be paid to the
Collateral Agent for the account of the persons entitled thereto by certified or
official bank check or checks drawn on or by a New York Clearing House bank and
payable in immediately available funds or in immediately available funds by wire
transfer to an account or accounts designated by the Collateral Agent.
If the Securities are not represented by a Global Security held by or on
behalf of The Depository Trust Company, certificates for the Securities shall be
registered in such names and denominations as the Remarketing Agent may request
not less than one full Business Day in advance of the Remarketing Closing Date,
and the Company, Duke Capital, the Collateral Agent and the registered holder or
holders thereof agree to have such certificates available for inspection,
packaging and checking by the Remarketing Agent in New York, New York not later
than 1:00 p.m. on the Business Day prior to the Remarketing Closing Date.
6. Notices. Unless otherwise specified, any notices, requests,
-------
consents or other communications given or made hereunder or pursuant hereto
shall be made in writing or transmitted by any standard form of
telecommunication, including telephone or telecopy, and confirmed in writing.
All written notices and confirmations of notices by telecommunication shall be
deemed to have been validly given or made when delivered or mailed, by
registered or certified mail, return receipt requested and postage prepaid. All
such notices, requests, consents or other communications shall be addressed as
follows: if to the Company or Duke Capital, to 000 Xxxxx Xxxxxx Xxxxxx,
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000, Attention: Chief Financial Officer, with a copy
to Xxxxx Xxxxxxxxxx LLP, 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, XX 00000,
Attention: Xxxx Xxxxxxx; if to the Remarketing Agent, to Xxxxxx Xxxxxxx & Co.
Incorporated, at 0000 Xxxxxxxx, Xxx Xxxx, XX 00000, Attention: __________; with
a copy to Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP, Xxxx Xxxxx Xxxxxx, Xxx Xxxx,
XX 00000, Attention: Xxxx X. Xxxxxx; and if to the Purchase Contract Agent, to
The Chase Manhattan Bank, 000 Xxxx 00xx Xxxxxx, Xxx Xxxx, XX 00000, Attention:
Institutional Trust Services, or to such other address as any of the above shall
specify to the other in writing.
7. Conditions to Obligations of Remarketing Agent. Anything herein to
----------------------------------------------
the contrary notwithstanding, the parties hereto agree that the obligations of
the Remarketing Agent under this Agreement and the Remarketing Agreement are
subject to the satisfaction of the conditions set forth in Section 7 of the
Remarketing Agreement (which are incorporated herein by reference), and to the
satisfaction, on the Remarketing Closing Date, of the conditions incorporated by
reference herein
A-4
from Section 7 of the Underwriting Agreement as modified by Section 3(b) hereof
(including, without limitation, the delivery of opinions of counsel, officers'
certificates and accountants' comfort letters as reasonably requested by the
Remarketing Agent and in form and substance reasonably satisfactory to the
Remarketing Agent, the accuracy as of the Remarketing Closing Date of the
representations and warranties of the Company and Duke Capital included and
incorporated by reference herein and the performance by the Company and Duke
Capital of their obligations under the Remarketing Agreement and this Agreement
as and when required hereby and thereby). In addition, anything herein or in the
Remarketing Agreement to the contrary notwithstanding, the Remarketing Agreement
and this Agreement may be terminated by the Remarketing Agent, by notice to the
Company and Duke Capital at any time prior to the time of settlement on the
Remarketing Closing Date, if any of the events or conditions set forth in
Section 7(h) of the Underwriting Agreement, as modified by Section 3(b) hereof,
shall have occurred or shall exist.
8. Indemnity and Contribution. Anything herein to the contrary
--------------------------
notwithstanding, the Remarketing Agent shall be entitled to indemnity and
contribution on the terms and conditions set forth in the Remarketing Agreement.
A-5
If the foregoing is in accordance with your understanding of our agreement,
please sign and return to us the enclosed duplicate hereof, whereupon this
letter and your acceptance shall represent a binding agreement among the Company
and the Remarketing Agent.
Very truly yours,
DUKE ENERGY CORPORATION
By: __________________________________
Name:
Title:
DUKE CAPITAL CORPORATION
By: __________________________________
Name:
Title:
CONFIRMED AND ACCEPTED:
XXXXXX XXXXXXX & CO. INCORPORATED
By: __________________________
Authorized Signatory
[Add other Remarketing Agents, if any]
THE CHASE MANHATTAN BANK
not individually but solely as Purchase Contract
Agent and as attorney-in-fact for the holders of
the Purchase Contracts
By :__________________________
Name:
Title:
A-6
SCHEDULE I
Securities subject to the remarketing: ___% Senior Notes
due 2006 of Duke Capital (the "Securities").
Purchase Contract Agreement, dated as of March __, 2001
(the "Purchase Contract Agreement") by and between Duke Energy Corporation,
a North Carolina corporation, and The Chase Manhattan Bank, a New York
banking corporation.
Pledge Agreement dated as of March __, 2001 (the "Pledge Agreement") by and
between Duke Energy Corporation, a North Carolina corporation, Bank One
Trust Company, N.A., a national banking association, and The Chase
Manhattan Bank.
Indenture dated as of April 1, 1998 (the "Senior Indenture") by and between Duke
Capital Corporation, a Delaware corporation, and The Chase Manhattan Bank,
a New York banking corporation, as trustee.
Third Supplemental Indenture, dated as of March __, 2001
(the "Third Supplemental Indenture" and, together with the Senior
Indenture, the "Indenture") by and between Duke Capital Corporation, a
Delaware corporation, and The Chase Manhattan Bank, a New York banking
corporation, as trustee.
[Minimum Initial Remarketing Price]
[Aggregate Principal Amount of Securities: $ ____________]
Underwriting Agreement, dated March __, 2001 (the "Underwriting Agreement")
among Duke Energy Corporation, Duke Capital Corporation, Xxxxxx Xxxxxxx &
Co. Incorporated, Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated, Bank
of America Securities LLC, Credit Suisse First Boston Corporation and X. X.
Xxxxxx Securities Inc.
Remarketing Closing Date, Time and Location:
A-7
