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EXHIBIT (10)(a)
$800,000,000
CMS PANHANDLE HOLDING COMPANY
$300,000,000 6.125% Senior Notes due 2004
$200,000,000 6.500% Senior Notes due 2009
$300,000,000 7.000% Senior Notes due 2029
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Purchase Agreement
March 23, 1999
Xxxxxxxxx, Xxxxxx & Xxxxxxxx
Securities Corporation
Barclays Capital Inc.
Chase Securities Inc.
NationsBanc Xxxxxxxxxx Securities LLC
First Chicago Capital Markets, Inc.
Xxxxxxx Xxxxx Xxxxxx Inc.
XX Xxxxx Securities Corporation
c/x Xxxxxxxxx, Xxxxxx & Xxxxxxxx
Securities Corporation
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
CMS Panhandle Holding Company, a Michigan corporation (the
"Company") confirms its agreement with Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities
Corporation ("DLJ"), NationsBanc Xxxxxxxxxx Securities LLC, Chase Securities
Inc., Barclays Capital Inc., First Chicago Capital Markets, Inc, XX Xxxxx
Securities Corporation, and Xxxxxxx Xxxxx Xxxxxx Inc. (each, an "Initial
Purchaser", and collectively, the "Initial Purchasers") with respect to the
issue and sale by the Company and the purchase by the Initial Purchasers, acting
severally and not jointly, of the respective principal amounts set forth in
Schedule A of its $300,000,000 6.125% Senior Notes due 2004 (the "2004 Notes"),
$200,000,000 6.500% Senior Notes due 2009 (the "2009 Notes"), and $300,000,000
7.000% Senior Notes due 2029 (the "2029 Notes") (together, the "Senior Notes"),
subject to the terms and conditions set forth herein. The Senior Notes are to be
issued pursuant to the provisions of the Indenture, dated as of March 29, 1999,
by and among the Company, Panhandle Eastern Pipe Line Company, a Delaware
corporation ("Panhandle"), and NBD Bank, as trustee (the "Trustee"), relating to
the Senior Notes (the "Base Indenture"), as supplemented by a First Supplemental
Indenture, to be dated March 29, 1999 (the "Supplemental Indenture" and together
with the Base Indenture, the
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"Indenture"), by and among the Company, Panhandle and the Trustee. Following the
Closing Date (as defined below), the Company will merge with and into Panhandle.
Until the Company merges with and into Panhandle, Panhandle will irrevocably and
unconditionally guarantee all payments under the Senior Notes, pursuant to the
terms of the guarantee (the "Guarantee") included in the Base Indenture. Once
the Company has merged with and into Panhandle, the obligations of the Company
under the Senior Notes and the Indenture will be assumed by Panhandle.
Capitalized terms used but not defined herein shall have the meanings given to
such terms in the Indenture.
Holders (including subsequent transferees) of the Senior Notes
will have the registration rights set forth in the registration rights agreement
(the "Registration Rights Agreement"), to be dated the Closing Date (as defined
below), for so long as such Senior Notes constitute "Transfer Restricted
Securities" (as defined in the Registration Rights Agreement). Pursuant to the
Registration Rights Agreement, the Company will agree to file with the
Securities and Exchange Commission (the "Commission"), under the circumstances
set forth therein, (i) a registration statement (the "Registration Statement")
under the Securities Act of 1933, as amended (the "Act") relating to senior
notes (the "Exchange Notes") to be offered in exchange for the Senior Notes
(such offer to exchange being referred to as the "Exchange Offer") and (ii) a
shelf registration statement pursuant to Rule 415 under the Act (the "Shelf
Registration Statement" and, together with the Exchange Offer Registration
Statement, the "Registration Statements") relating to the resale by certain
holders of the Senior Notes and to use its best efforts to cause such
Registration Statements to be declared and remain effective and usable for the
periods specified in the Registration Rights Agreement and to consummate the
Exchange Offer. The Senior Notes and the Exchange Notes issuable in exchange
therefor are collectively referred to herein as the "Notes." This Agreement, the
Indenture, the Notes and the Registration Rights Agreement are hereinafter
sometimes referred to collectively as the "Operative Documents."
1. Offering Memorandum: The Senior Notes will be offered and sold
to the Initial Purchasers pursuant to one or more exemptions from the
registration requirements under the Act. The Company and Panhandle have prepared
a preliminary offering memorandum dated March 22, 1999 (the "Preliminary
Offering Memorandum") and an offering memorandum, dated March 23, 1999 (the
"Offering Memorandum") relating to the Senior Notes, which incorporate by
reference documents filed by Panhandle pursuant to Sections 13, 14 or 15 of the
Securities and Exchange Act of 1934, as amended (the "Exchange Act"). As used
herein, the term "Preliminary Offering Memorandum" and "Offering Memorandum"
shall include respectively the documents incorporated by reference therein. Any
reference herein to the terms "amend," "amendment" or "supplement" with respect
to the Preliminary Offering Memorandum and Offering Memorandum shall be deemed
to include amendments or supplements to the Preliminary Offering Memorandum and
Offering Memorandum, and documents incorporated by reference after the date of
this Agreement and prior to the termination of the offering of the Senior Notes
by the Initial Purchasers.
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Upon original issuance thereof, and until such time as the same is
no longer required pursuant to the Indenture, (and all securities issued in
exchange or in substitution thereof) the Senior Notes shall bear the following
legend:
THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE U.S.
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") AND MAY NOT
BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A)(1) TO A
PERSON WHO THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL
BUYER WITHIN THE MEANING OF RULE 144A UNDER THE SECURITIES ACT
PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE
144A, (2) IN AN OFFSHORE TRANSACTION COMPLYING WITH RULE 903 OR RULE
904 OF REGULATION S UNDER THE SECURITIES ACT, (3) TO AN INSTITUTIONAL
ACCREDITED INVESTOR IN A TRANSACTION EXEMPT FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT OR (4) PURSUANT TO AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER
(IF AVAILABLE) AND (B) IN ACCORDANCE WITH ALL APPLICABLE SECURITIES
LAWS OF THE STATES OF THE UNITED STATES.
2. Agreements to Sell and Purchase: On the basis of the
representations, warranties and covenants contained in this Agreement, and
subject to the terms and conditions contained herein, the Company agrees to
issue and sell to the several Initial Purchasers, and the Initial Purchasers
agree, severally and not jointly, to purchase from the Company, the principal
amounts of Senior Notes set forth opposite the name of such Initial Purchaser on
Schedule A hereto at a purchase price equal to 99.084% in the case of the 2004
Notes, 98.973% in the case of the 2009 Notes and 97.859% in the case of the 2029
Notes, of the respective principal amounts thereof (collectively, the "Purchase
Price").
The Company hereby agrees that, without the prior written consent
of DLJ, it will not offer, sell, contract to sell or otherwise issue debt
securities substantially similar to the Senior Notes for a period from the date
of the execution of this Agreement until the date 30 days after the Closing
Date.
3. Terms of Offering: The Initial Purchasers have advised the
Company that the Initial Purchasers will take offers (the "Exempt Resales") of
the Senior Notes purchased hereunder on the terms set forth in the Offering
Memorandum solely to (i) persons whom the Initial Purchasers reasonably believe
to be "qualified institutional buyers" as defined in Rule 144A under the Act
("QIBs") and (ii) to persons permitted to purchase the Senior Notes in offshore
transactions in reliance upon Regulation S under the Act (each, a "Regulation S
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Purchaser") (such persons specified in clauses (i) and (ii) being referred to
herein as the "Eligible Purchasers"). The Initial Purchasers will offer the
Senior Notes to Eligible Purchasers initially at a price equal to 100% of the
principal amount thereof. Such price may be changed at any time without notice.
4. Delivery and Payment:
(a) Delivery of and payment of the Purchase Price for the Senior
Notes shall be made at the offices of Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP,
000 Xxxxx Xxxxxx, Xxx Xxxx, XX 00000, or such other location as may be mutually
acceptable. Payment for the Senior Notes shall be made to the Company in federal
or other funds immediately available in New York City against delivery of such
Senior Notes for the respective accounts of the several Initial Purchasers at
10:00 a.m., New York City time, on March 29, 1999, or at such other time as
shall be agreed upon by the Initial Purchasers and the Company. The time and
date of such delivery and the payment are herein called the "Closing Date."
(b) Certificates for the Senior Notes shall be in definitive
form or global form, as specified by you, and registered in such names and in
such denominations as you shall request in writing not later than one full
business day prior to the Closing Date. The certificates evidencing the Senior
Notes shall be delivered to you on the Closing Date for the respective accounts
of the several Initial Purchasers, with any transfer taxes payable in connection
with the transfer of the Senior Notes to the Initial Purchasers duly paid,
against payment of the Purchase Price therefor plus accrued interest, if any, to
the date of payment and delivery. Certificates for the Senior Notes shall be
made available to the Initial Purchasers for inspection not later than 9:30
a.m., New York City time, on the business day immediately preceding the Closing
Date.
5. Agreements of the Company: In further consideration of the
agreements of the Initial Purchasers herein contained, the Company covenants as
follows:
(a) To prepare the Preliminary Offering Memorandum and Offering
Memorandum in a form approved by you; to make no amendment or any supplement to
the Preliminary Offering Memorandum and Offering Memorandum which shall be
disapproved by your counsel upon legal grounds in writing, after consultation
with you, promptly after reasonable notice thereof; and to furnish you with
copies thereof.
(b) To advise the Initial Purchasers promptly and, if requested
by the Initial Purchasers, confirm such advice in writing, (i) of the issuance
by any state securities commission of any stop order suspending the
qualification or exemption from qualification of any Senior Notes for offering
or sale in any jurisdiction designated by the Initial Purchasers pursuant to
Section 5(e) hereof, or the initiation of any proceeding by any state securities
commission or any other federal or state regulatory authority for such purpose.
The Company shall use its best efforts to prevent the issuance of any stop order
or order suspending the qualification or exemption of any Senior Notes under any
state securities or Blue Sky laws and, if at any time any state securities
commission or other federal or state regulatory authority shall issue an order
suspending the
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qualification or exemption of any Senior Notes under any state securities or
Blue Sky laws, the Company shall use its best efforts to obtain the withdrawal
or lifting of such order at the earliest possible time.
(c) Prior to 10:00 a.m., New York City time, on the Business Day
next succeeding the date of this Agreement, or as soon as otherwise mutually
agreed, and from time to time thereafter, to furnish the Initial Purchasers and
those persons identified by the Initial Purchasers to the Company as many copies
of the Offering Memorandum, and any amendments or supplements thereto, in such
quantities as the Initial Purchasers may reasonably request. Subject to the
Initial Purchasers' compliance with their representations and warranties and
agreements set forth in Section 7 hereof, the Company consents to the use of the
Offering Memorandum, and any amendments and supplements thereto required
pursuant hereto, by the Initial Purchasers in connection with Exempt Resales.
(d) Until such time as either of the Registration Statements
shall be declared effective by the Commission, but in no event later than nine
months after the date of the Offering Memorandum, any event shall have occurred
as a result of which the Offering Memorandum as then amended or supplemented
would include an untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in light of the
circumstances under which they were made when such Offering Memorandum is
delivered, not misleading, or, if for any other reason it shall be necessary or
desirable during such same period to amend or supplement the Offering
Memorandum, to notify you and upon your request to prepare and, subject to
Section 5(a) and 5(j) hereof, furnish without charge to each Initial Purchaser
and to any dealer in securities as many copies as you may from time to time
reasonably request of an amended Offering Memorandum or a supplement to the
Offering Memorandum which will correct such statement or omission or effect such
compliance.
(e) To use its best efforts to qualify the Senior Notes for
offer and sale under the securities or Blue Sky laws of such jurisdictions as
the Initial Purchasers may designate and to pay (or cause to be paid), or
reimburse (or cause to be reimbursed) the Initial Purchasers and their counsel
for, reasonable filing fees and expenses in connection therewith (including the
reasonable fees and disbursements of counsel to the Initial Purchasers and
filing fees and expenses paid and incurred prior to the date hereof), provided,
however, that the Company shall not be required to qualify to do business as a
foreign corporation or as a securities dealer or to file a general consent to
service of process or to file annual reports or to comply with any other
requirements deemed by the Company to be unduly burdensome.
(f) So long as the Notes are outstanding, (i) to mail and make
generally available as soon as practicable after the end of each fiscal year to
the record holders of the Notes a financial report of the Company on a
consolidated basis, all such financial reports to
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include a consolidated balance sheet, a consolidated statement of operations, a
consolidated statement of cash flows and a consolidated statement of
shareholders' equity as of the end of and for such fiscal year, together with
comparable information as of the end of and for the preceding year, certified by
the Company's independent public accountants and (ii) to mail and make generally
available as soon as practicable after the end of each quarterly period (except
for the last quarterly period of each fiscal year,) to such holders, a
consolidated balance sheet, a consolidated statement of operations and a
consolidated statement of cash flows as of the end of and for such period, and
for the period from the beginning of such year to the close of such quarterly
period, together with comparable information for the corresponding periods of
the preceding year.
(g) So long as any of the Senior Notes remain outstanding and
during any period in which either the Company is not subject to Section 13 or
15(d) of the Exchange Act, to make available to any holder of Senior Notes in
connection with any sale thereof and any prospective purchaser of such Senior
Notes from such holder, the information required by Rule 144A(d)(4) under the
Act.
(h) To pay all expenses, fees and taxes (other than transfer
taxes on sales by the respective Initial Purchasers) in connection with the
issuance and delivery of the Senior Notes, except that the Company shall be
required to pay the fees and disbursements (other than fees and disbursements
referred to in paragraph (e) of this Section 5) of Skadden, Arps, Slate, Xxxxxxx
& Xxxx LLP, New York, New York, counsel to the Initial Purchasers, only in the
events provided in paragraph (i) of this Section 5, the Initial Purchasers
hereby agreeing to pay such fees and disbursements in any other event, and that
except as provided in such paragraph (i), the Company shall not be responsible
for any out-of-pocket expenses of the Initial Purchasers in connection with
their services hereunder.
(i) If the Initial Purchasers shall not take up and pay for the
Senior Notes due to the failure of the Company to comply with any of the
conditions specified in Section 10 hereof, or, if this Agreement shall be
terminated in accordance with the provisions of Section 11(b) hereof prior to
the Closing Date, to pay the reasonable fees and disbursements of Skadden, Arps,
Slate, Xxxxxxx & Xxxx LLP, counsel to the Initial Purchasers, and, if the
Initial Purchasers shall not take up and pay for the Senior Notes due to the
failure of the Company to comply with any of the conditions specified in Section
10 hereof, to reimburse the Initial Purchasers for their reasonable
out-of-pocket expenses, in an aggregate amount not exceeding a total of $3,000,
incurred in connection with the financing contemplated by this Agreement.
(j) During the period referred to in paragraph (d) of this
Section 5, to not amend or supplement the Offering Memorandum unless the Company
has furnished the Initial Purchasers and counsel to the Initial Purchasers with
a copy for their review and comment a reasonable time prior to filing and has
reasonably considered any comments of the Initial
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Purchasers, or any such amendment or supplement to which such counsel shall
reasonably object on legal grounds in writing, after consultation with the
Initial Purchasers.
(k) During the period referred to in paragraph (d) of this
Section 5, to furnish the Initial Purchasers with copies of all documents
required to be filed with the Commission pursuant to Section 13, 14 or 15(d) of
the Exchange Act.
(l) During the period referred to in paragraph (d) of this
Section 5, to comply with all requirements under the Exchange Act relating to
the filing with the Commission of its reports pursuant to Section 13 of the
Exchange Act and of its proxy statements pursuant to Section 14 of the Exchange
Act.
(m) To comply in all material respects with all of its
agreements set forth in the Registration Rights Agreement.
(n) To obtain the approval of The Depository Trust Company
("DTC") for "book-entry" transfer of the Notes, and to comply in all material
respects with all of its agreements set forth in the representation letters of
the Company to DTC relating to the approval of the Notes by DTC for "book-entry"
transfer.
(o) Not to (or permit any affiliate to) sell, offer for sale or
solicit offers to buy or otherwise negotiate in respect of any security (as
defined in the Act) that would be integrated with the sale of the Senior Notes
to the Initial Purchasers or pursuant to Exempt Resales in a manner that would
require the registration of any such sale of the Senior Notes under the Act.
(p) Not to voluntarily claim, and to actively resist any
attempts to claim, the benefit of any usury laws against the holders of any
Notes.
(q) To cause the Exchange Offer to be made in the appropriate
form to permit Exchange Notes registered pursuant to the Act to be offered in
exchange for the Senior Notes and to comply in all material respects with all
applicable federal and state securities laws in connection with the Exchange
Offer.
(r) During the period of two years after the Closing Date, not
to, and not permit any of its affiliates (as defined in Rule 144 under the Act)
to, resell any of the Notes which constitute "restricted securities" under Rule
144 that have been reacquired by any of them.
(s) To apply the net proceeds of the offering and sale of the
Senior Notes in the manner set forth in the Offering Memorandum under the
caption "Use of Proceeds".
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6. Representations and Warranties of the Company: The Company
represents and warrants to, and agrees with, each of the Initial Purchasers
that:
(a) Each of the Preliminary Offering Memorandum and the Offering
Memorandum does not, and any supplement or amendment to it will not, contain any
untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading, except that the
representations and warranties contained in this paragraph shall not apply to
statements in or omissions from the Preliminary Offering Memorandum and the
Offering Memorandum (or any supplement or amendment thereto) based upon
information relating to the Initial Purchasers furnished to the Company in
writing by the Initial Purchasers expressly for use therein. No stop order
preventing the use of the Offering Memorandum, or any amendment or supplement
thereto, or any order asserting that any of the transactions contemplated by
this Agreement are subject to the registration requirements of the Act, has been
issued.
(b) The documents incorporated by reference in the Preliminary
Offering Memorandum and the Offering Memorandum, when they were filed (or, if an
amendment with respect to any such document was filed, when such amendment was
filed) with the Commission, conformed in all material respects to the
requirements of the Exchange Act and the rules and regulations of the Commission
promulgated thereunder, and any further documents so filed and incorporated by
reference will, when they are filed with the Commission, conform in all material
respects to the requirements of the Exchange Act and the rules and regulations
of the Commission promulgated thereunder; none of such documents, when it was
filed (or, if an amendment with respect to any such document was filed, when
such amendment was filed), contained an untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they were
made, not misleading; and no such further document, when it is filed, will
contain an untrue statement of a material fact or will omit to state a material
fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they are made, not misleading.
(c) Each of the Company and Panhandle has been duly organized
and is validly existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation and has all requisite authority to own or
lease its properties and conduct its business as described in the Preliminary
Offering Memorandum and the Offering Memorandum and to consummate the
transactions contemplated hereby, and is duly qualified to transact business and
is in good standing in each jurisdiction in which the conduct of its business as
described in the Preliminary Offering Memorandum and the Offering Memorandum or
its ownership or leasing of property requires such qualification, except to the
extent that the failure to be so qualified or be in good standing would not have
a material adverse effect on either the Company or Panhandle and their
respective Subsidiaries (as defined in Rule 405 under the Act, and hereinafter
called a "Subsidiary"), taken as a whole;
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each Significant Subsidiary (as defined in Rule 405 under the Act, and
hereinafter called a "Significant Subsidiary") of the Company and Panhandle has
been duly organized and is validly existing as a corporation in good standing
under the laws of the jurisdiction of its incorporation, has all requisite
authority to own or lease its properties and conduct its business as described
in the Preliminary Offering Memorandum and the Offering Memorandum and is duly
qualified to transact business and is in good standing in each jurisdiction in
which the conduct of its business as described in the Preliminary Offering
Memorandum and the Offering Memorandum or its ownership or leasing of property
requires such qualification, except to the extent that the failure to be so
qualified or be in good standing would not have a material adverse effect on
either the Company or Panhandle and their respective Subsidiaries, taken as a
whole.
(d) This Agreement has been duly authorized, executed and
delivered by the Company.
(e) The Notes are in the form contemplated by the Indenture and
have been duly authorized by the Company. At the Closing Date, the Senior Notes
will have been duly executed and delivered by the Company and, (i) the Senior
Notes, when authenticated by the Trustee in the manner provided for in the
Indenture and delivered against payment therefor as provided in this Agreement,
and (ii) the Exchange Notes, when issued, executed and authenticated in
accordance with the terms of the Exchange Offer and the Indenture, will
constitute valid and binding obligations of the Company enforceable against the
Company in accordance with their terms, except to the extent that enforcement
thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or
other similar laws affecting creditors' rights generally or by general
principles of equity (regardless of whether enforcement is considered in a
proceeding at law or in equity), and will be entitled to the security afforded
by the Indenture equally and ratably with all securities outstanding thereunder.
The Notes conform in all material respects to the descriptions thereof in the
Preliminary Offering Memorandum and the Offering Memorandum.
(f) The Registration Rights Agreement has been duly authorized
by the Company. At the Closing Date, the Registration Rights Agreement will have
been duly executed and delivered by the Company and will constitute a valid and
binding agreement of the Company, enforceable against the Company in accordance
with its terms except to the extent that the enforcement thereof may be limited
by bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting creditors' rights generally and by general principles of equity
(regardless of whether enforcement is considered in a proceeding at law or in
equity) by, equitable principles of general applicability. The Registration
Rights Agreement conforms in all material respects to the description thereof in
the Preliminary Offering Memorandum and the Offering Memorandum.
(g) The Indenture has been duly authorized by the Company. At
the Closing Date, the Indenture will have been duly executed and delivered by
the Company and will
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constitute a valid and binding obligation of the Company, enforceable against
the Company in accordance with its terms, except to the extent that enforcement
thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or
other similar laws affecting creditors' rights generally or by general
principles of equity (regardless of whether enforcement is considered in a
proceeding at law or in equity); the Indenture conforms in all material respects
to the description thereof in the Preliminary Offering Memorandum and the
Offering Memorandum; and the Indenture conforms to the requirements of the Trust
Indenture Act of 1939, as amended (the "TIA").
(h) On and after the Closing Date, of the outstanding capital
stock of each of Panhandle, Panhandle Storage Company and Trunkline LNG Company
and each subsidiary of Panhandle organized in the United States (the "U.S.
Subsidiaries") will be owned directly or indirectly by the Company, free and
clear of any security interest, claim, lien, or other encumbrance or preemptive
rights), and there are no outstanding rights (including, without limitation,
preemptive rights), warrants or options to acquire, or instruments convertible
into or exchangeable for, any shares of capital stock or other equity interest
in any of Panhandle Storage Company, Trunkline LNG Company and the U.S.
Subsidiaries or any contract, commitment, agreement, understanding or
arrangement of any kind relating to the issuance of any such capital stock, any
such convertible or exchangeable securities or any such rights, warrants or
options. The Company has no subsidiaries and has conducted no business prior to
the date hereof other than in connection with the transactions contemplated by
this Agreement.
(i) Each of the Company and Panhandle have all necessary
consents, authorizations, approvals, orders, certificates and permits of and
from, and have made all declarations and filings with, all federal, state, local
and other governmental authorities, all self-regulatory organizations and all
courts and other tribunals, to own, lease, license and use its properties and
assets and to conduct its business in the manner described in the Preliminary
Offering Memorandum and the Offering Memorandum, except to the extent that the
failure to obtain or file would not have a material adverse effect on either the
Company or Panhandle.
(j) No order, license, consent, authorization or approval of, or
exemption by, or the giving of notice to, or the registration with any federal,
state, municipal or other governmental department, commission, board, bureau,
agency or instrumentality, and no filing, recording, publication or registration
in any public office or any other place, was or is now required to be obtained
by either of the Company or Panhandle to authorize their execution or delivery
of, or the performance of its obligations under, this Agreement, in the case of
the Company, or any of the Operative Documents, in the case of the Company and
Panhandle, except such as have been obtained or may be required under state
securities or Blue Sky laws or as referred to in the Preliminary Offering
Memorandum and the Offering Memorandum.
(k) None of the issuance and sale of the Notes, or the execution
or delivery by the Company and Panhandle of, or the performance by the Company
and Panhandle of their
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respective obligations under, this Agreement, in the case of the Company, or the
Operative Documents, in the case of the Company and Panhandle, did or will
conflict with, result in a breach of any of the terms or provisions of, or
constitute a default or require the consent of any party under the Company's and
Panhandle's Articles of Incorporation or by-laws, any material agreement or
instrument to which each of the Company and Panhandle is a party, any existing
applicable law, rule or regulation or any judgment, order or decree of any
government, governmental instrumentality or court, domestic or foreign, having
jurisdiction over either the Company or Panhandle or any of their respective
properties or assets, or, except as described in the Preliminary Offering
Memorandum and the Offering Memorandum, did or will result in the creation or
imposition of any lien on either of the Company's or Panhandle's respective
properties or assets.
(l) Except as disclosed in the Offering Memorandum, there is no
action, suit, proceeding, inquiry or investigation (at law or in equity or
otherwise) pending or, to the knowledge of the Company, threatened against
either the Company or Panhandle, respectively, by any governmental authority
that (i) questions the validity, enforceability or performance of this Agreement
or any of the Operative Documents or (ii) if determined adversely, is likely to
have a material adverse effect on the business or financial condition of either
the Company or Panhandle, or have a material adverse effect on the ability of
the Company to perform its obligations hereunder or the ability of either the
Company or Panhandle to consummate the transactions contemplated by this
Agreement.
(m) There has not been any material and adverse change in the
business, properties or financial condition of either the Company or Panhandle
from that set forth or incorporated by reference in the Offering Memorandum
(other than changes referred to in or contemplated by the Offering Memorandum).
(n) Except as set forth in the Offering Memorandum, no event or
condition exists that constitutes, or with the giving of notice or lapse of time
or both would constitute, a default or any breach or failure to perform by the
Company, Panhandle or any of their respective Significant Subsidiaries in any
material respect under any indenture, mortgage, loan agreement, lease or other
material agreement or instrument to which either the Company or Panhandle or any
of their respective Significant Subsidiaries is a party or by which they or any
of their Significant Subsidiaries or any of their respective properties may be
bound.
(o) The Offering Memorandum, as of its date, contained all the
information specified in, and meeting the requirements of, Rule 144A(d)(4) under
the Act.
(p) When the Senior Notes are issued and delivered pursuant to
this Agreement, the Senior Notes will not be of the same class (within the
meaning of Rule 144A under the Act) as any security of the Company or Panhandle
that is listed on a national securities exchange registered under Section 6 of
the Exchange Act or that is quoted in a United States automated inter-dealer
quotation system.
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(q) Neither the Company or Panhandle nor any Affiliate of the
Company or Panhandle has directly, or through any agent, (i) sold, offered for
sale, solicited offers to buy or otherwise negotiated in respect of, any
security (as defined in the Act) which is or will be integrated with the sale of
the Senior Notes in a manner that would require the registration under the Act
of the Senior Notes or (ii) engaged in any form of general solicitation or
general advertising in connection with the offering of the Senior Notes, (as
those terms are used in Regulation D under the Act) or in any manner involving a
public offering within the meaning of Section 4(2) of the Act, including, but
not limited to, publication or release of articles, notices or other
communications published in any newspaper, magazine, or similar medium or
broadcast over television or radio, or any seminar or meeting whose attendees
have been invited by any general solicitation or general advertising. No
securities of the same class as the Senior Notes have been issued and sold by
the Company within the six-month period immediately prior to the date hereof.
(r) Prior to the effectiveness of any Registration Statement,
the Indenture is not required to be qualified under the TIA.
(s) None of the Company or Panhandle nor any of their respective
affiliates or any person acting on its or their behalf (other than the Initial
Purchasers, as to whom the Company and Panhandle make no representation) has
engaged or will engage in any directed selling efforts within the meaning of
Regulation S under the Act ("Regulation S") with respect to the Senior Notes.
(t) The Senior Notes offered and sold in reliance on Regulation
S have been and will be offered and sold only in offshore transactions.
(u) The sale of the Senior Notes pursuant to Regulation S is not
part of a plan or scheme to evade the registration provisions of the Act.
(v) The Company, Panhandle and their respective affiliates and
all persons acting on their behalf (other than the Initial Purchasers, as to
whom the Company and Panhandle make no representation) have complied with and
will comply with, in all material respects, the offering restrictions
requirements of Regulation S in connection with the offering of the Senior Notes
outside the United States and, in connection therewith, the Offering Memorandum
will contain the disclosure required by Rule 902(h).
(w) No registration under the Act of the Senior Notes is
required for the sale of the Senior Notes to the Initial Purchasers as
contemplated hereby or for the Exempt Resales assuming the accuracy of the
Initial Purchasers' representations and warranties and agreements set forth in
Section 7 hereof.
(x) Neither the Company or Panhandle nor any of their respective
Subsidiaries, after giving effect to the offering and sale of the Senior Notes,
will be, an
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13
"investment company" within the meaning of the Investment Company Act of 1940,
as amended.
The Company acknowledges that the Initial Purchasers and, for
purposes of the opinions to be delivered to the Initial Purchasers pursuant to
Section 10 hereof, counsel to the Company and Panhandle and counsel to the
Initial Purchasers will rely upon the accuracy and truth of the foregoing
representations and hereby consents to such reliance.
7. Initial Purchasers' Representations and Warranties: Upon the
authorization by you of the release of the Senior Notes, the several Initial
Purchasers propose to offer the Senior Notes for sale upon the terms and
conditions set forth in this Agreement and the Offering Memorandum and each
Initial Purchaser hereby represents and warrants to, and agrees with the Company
that:
(a) It will offer and sell the Senior Notes only to Eligible
Purchasers;
(b) It is an Institutional Accredited Investor; and
(c) It will not offer or sell the Senior Notes by any form of
general solicitation or general advertising, including but not limited to the
methods described in Rule 502(c) under the Act.
8. Indemnification:
(a) The Company agrees, to the extent permitted by law, to
indemnify and hold harmless each of the Initial Purchasers and each person, if
any, who controls any such Initial Purchaser within the meaning of Section 15 of
the Act or Section 20 of the Exchange Act, against any and all losses, claims,
damages or liabilities, joint or several, to which they or any of them may
become subject under the Act or otherwise, and to reimburse the Initial
Purchasers and such controlling person or persons, if any, for any legal or
other expenses incurred by them in connection with defending any action, suit or
proceeding (including governmental investigations) as provided in Section 8(c)
hereof, insofar as such losses, claims, damages, liabilities or actions, suits
or proceedings (including governmental investigations) arise out of or are based
upon any untrue statement or alleged untrue statement of a material fact
contained in the Offering Memorandum, or, if the Offering Memorandum shall be
amended or supplemented, in the Offering Memorandum as so amended or
supplemented or arise out of or are based upon any omission or alleged omission
to state therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, except insofar as such losses,
claims, damages, liabilities or actions arise out of or are based upon any such
untrue statement or alleged untrue statement or omission or alleged omission
which was made in the Offering Memorandum or in the Offering Memorandum as so
amended or supplemented, in reliance upon and in conformity with information
furnished in writing to the Company by, or through DLJ on behalf of, any Initial
Purchaser expressly for use therein and except that this indemnity
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shall not inure to the benefit of any Initial Purchaser (or any person
controlling such Initial Purchaser) on account of any losses, claims, damages,
liabilities or actions, suits or proceedings arising from the sale of the Senior
Notes to any person if a copy of the Offering Memorandum, as the same may then
be supplemented or amended (excluding, however, any document then incorporated
or deemed incorporated therein by reference), was not sent or given by or on
behalf of such Initial Purchaser to such person (i) with or prior to the written
confirmation of sale involved or (ii) as soon as available after such written
confirmation, relating to an event occurring prior to the payment for and
delivery to such person of the Senior Notes involved in such sale, and the
omission or alleged omission or untrue statement or alleged untrue statement was
corrected in the Offering Memorandum as supplemented or amended at such time.
The Company's indemnity agreement contained in this Section 8(a),
and the covenants, representations and warranties of the Company and Panhandle
contained in this Agreement, shall remain in full force and effect regardless of
any investigation made by or on behalf of any person, and shall survive the
delivery of and payment for the Senior Notes hereunder, and the indemnity
agreement contained in this Section 8 shall survive any termination of this
Agreement. The liabilities of the Company in this Section 8(a) are in addition
to any other liabilities of the Company under this Agreement or otherwise.
(b) Each Initial Purchaser agrees, severally and not jointly, to
the extent permitted by law, to indemnify, hold harmless and reimburse the
Company, each other Initial Purchaser and each person, if any, who controls the
Company or any such other Initial Purchaser within the meaning of Section 15 of
the Act or Section 20 of the Exchange Act, to the same extent and upon the same
terms as the indemnity agreement of the Company set forth in Section 8(a)
hereof, but only with respect to alleged untrue statements or omissions made in
the Offering Memorandum or in the Offering Memorandum, as amended or
supplemented, (if applicable) in reliance upon and in conformity with
information furnished in writing to the Company by such Initial Purchaser
expressly for use therein.
The indemnity agreement on the part of each Initial Purchaser
contained in this Section 8(b) and the representations and warranties of such
Initial Purchaser contained in this Agreement shall remain in full force and
effect regardless of any investigation made by or on behalf of the Company or
any other person, and shall survive the delivery of and payment for the Senior
Notes hereunder, and the indemnity agreement contained in this Section 8(b)
shall survive any termination of this Agreement. The liabilities of each Initial
Purchaser in this Section 8(b) are in addition to any other liabilities of such
Initial Purchaser under this Agreement or otherwise.
(c) If a claim is made or an action, suit or proceeding
(including governmental investigations) is commenced or threatened against any
person as to which indemnity may be sought under Section 8(a) or 8(b), such
person (the "Indemnified Person") shall notify the person against whom such
indemnity may be sought (the "Indemnifying
-14-
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Person") promptly after any assertion of such claim threatening to institute an
action, suit or proceeding or if such an action, suit or proceeding is commenced
against such Indemnified Person, promptly after such Indemnified Person shall
have been served with a summons or other first legal process, giving information
as to the nature and basis of the claim. Failure to so notify the Indemnifying
Person shall not, however, relieve the Indemnifying Person from any liability
which it may have on account of the indemnity under Section 8(a) or 8(b) if the
Indemnifying Person has not been prejudiced in any material respect by such
failure. Subject to the immediately succeeding sentence, the Indemnifying Person
shall assume the defense of any such litigation or proceeding, including the
employment of counsel and the payment of all expenses, with such counsel being
designated, subject to the immediately succeeding sentence, in writing by DLJ in
the case of parties indemnified pursuant to Section 8(b) and by the Company in
the case of parties indemnified pursuant to Section 8(a). Any Indemnified Person
shall have the right to participate in such litigation or proceeding and to
retain its own counsel, but the fees and expenses of such counsel shall be at
the expense of such Indemnified Person unless (i) the Indemnifying Person and
the Indemnified Person shall have mutually agreed to the retention of such
counsel or (ii) the named parties to any such proceeding (including any
impleaded parties) include (x) the Indemnifying Person and (y) the Indemnified
Person and, in the written opinion of counsel to such Indemnified Person,
representation of both parties by the same counsel would be inappropriate due to
actual or likely conflicts of interest between them, in either of which cases
the reasonable fees and expenses of counsel (including disbursements) for such
Indemnified Person shall be reimbursed by the Indemnifying Person to the
Indemnified Person. If there is a conflict as described in clause (ii) above,
and the Indemnified Persons have participated in the litigation or proceeding
utilizing separate counsel whose fees and expenses have been reimbursed by the
Indemnifying Person and the Indemnified Persons, or any of them, are found to be
solely liable, such Indemnified Person shall repay to the Indemnifying Person
such fees and expenses of such separate counsel as the Indemnifying Person shall
have reimbursed. It is understood that the Indemnifying Person shall not, in
connection with any litigation or proceeding or related litigation or
proceedings in the same jurisdiction as to which the Indemnified Persons are
entitled to such separate representation, be liable under this Agreement for the
reasonable fees and out-of-pocket expenses of more than one separate firm
(together with not more than one appropriate local counsel) for all such
Indemnified Persons. Subject to the next paragraph, all such fees and expenses
shall be reimbursed by payment to the Indemnified Persons of such reasonable
fees and expenses of counsel promptly after payment thereof by the Indemnified
Persons.
In furtherance of the requirement above that fees and expenses of
any separate counsel for the Indemnified Persons shall be reasonable, the
Initial Purchasers and the Company agree that the Indemnifying Person's
obligations to pay such fees and expenses shall be conditioned upon the
following:
(i) in case separate counsel is proposed to be
retained by the Indemnified Persons pursuant to clause (ii) of the
preceding paragraph, the
-15-
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Indemnified Persons shall in good faith fully consult with the
Indemnifying Person in advance as to the selection of such
counsel;
(ii) reimbursable fees and expenses of such separate
counsel shall be detailed and supported in a manner reasonably
acceptable to the Indemnifying Person (but nothing herein shall be
deemed to require the furnishing to the Indemnifying Person of any
information, including without limitation, computer print-outs of
lawyers' daily time entries, to the extent that, in the judgment
of such counsel, furnishing such information might reasonably be
expected to result in a waiver of any attorney-client privilege);
and
(iii) The Company and the Initial Purchasers shall
cooperate in monitoring and controlling the fees and expenses of
separate counsel for Indemnified Persons for which the
Indemnifying Person is liable hereunder, and the Indemnified
Person shall use every reasonable effort to cause such separate
counsel to minimize the duplication of activities as between
themselves and counsel to the Indemnifying Person.
The Indemnifying Person shall not be liable for any settlement of
any litigation or proceeding effected without the written consent of the
Indemnifying Person, but if settled with such consent or if there be a final
judgment for the plaintiff, the Indemnifying Person agrees, subject to the
provisions of this Section 8, to indemnify the Indemnified Person from and
against any loss, damage, liability or expenses by reason of such settlement or
judgment. The Indemnifying Person shall not, without the prior written consent
of the Indemnified Persons, effect any settlement of any pending or threatened
litigation, proceeding or claim in respect of which indemnity has been properly
sought by the Indemnified Persons hereunder, unless such settlement includes an
unconditional release by the claimant of all Indemnified Persons from all
liability with respect to claims which are the subject matter of such
litigation, proceeding or claim.
(d) If the indemnification provided for in this Section 8 above
is unavailable to or insufficient to hold harmless an Indemnified Person under
this Section 8 in respect of any losses, claims, damages or liabilities (or
actions, suits or proceedings (including governmental investigations) in respect
thereof) referred to therein, then each Indemnifying Person under this Section 8
above shall contribute to the amount paid or payable by such Indemnified Person
as a result of such losses, claims, damages or liabilities (or actions in
respect thereof) in such proportion as is appropriate to reflect the relative
benefits received by the Indemnifying Person on the one hand and the Indemnified
Person on the other from the offering of the Senior Notes. If, however, the
allocation provided by the immediately preceding sentence is not permitted by
applicable law, then each Indemnifying Person shall contribute to such amount
paid or payable by such Indemnified Person in such proportion as is appropriate
to reflect not only such relative benefits but also the relative fault of each
Indemnifying Person, if any, on the one hand and the Indemnified Person on the
other in connection with the statements or omissions which
-16-
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resulted in such losses, claims, damages or liabilities (or actions, suits or
proceedings (including governmental investigations) in respect thereof), as well
as any other relevant equitable considerations. The relative benefits received
by the Company on the one hand and the Initial Purchasers on the other shall be
deemed to be in the same proportion as the total net proceeds from the offering
(before deducting expenses) received by the Company and the total discounts or
commissions received by the Initial Purchasers, in each case as set forth in the
Offering Memorandum, bear to the aggregate offering price of the Senior Notes.
The relative fault shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company on the one hand or the Initial Purchasers 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
the Initial Purchasers agree that it would not be just and equitable if
contribution pursuant to this Section 8(d) were determined by pro rata
allocation (even if the Initial Purchasers were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to above in this Section 8(d). The amount paid
or payable by an Indemnified Person as a result of the losses, claims, damages
or liabilities (or actions, suits or proceedings (including governmental
proceedings) in respect thereof) referred to above in this Section 8(d) shall be
deemed to include any legal or other expenses reasonably incurred by such
Indemnified Person in connection with investigating or defending any such
action, suits or proceedings (including governmental proceedings) or claim,
provided that the provisions of this Section 8 above have been complied with (in
all material respects) in respect of any separate counsel for such Indemnified
Person. Notwithstanding the provisions of this Section 8(d), no Initial
Purchaser shall be required to contribute any amount greater than the excess of
(i) the total price at which the Senior Notes sold and distributed by it to the
public were offered to the public over (ii) the amount of any damages which such
Initial Purchaser has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Initial Purchasers' obligations in this
Section 8(d) to contribute are several in proportion to their respective
purchase obligations and not joint.
The agreement with respect to contribution contained in this
Section 8(d) shall remain in full force and effect regardless of any
investigation made by or on behalf of the Company or any Initial Purchaser, and
shall survive delivery of and payment for the Senior Notes hereunder and any
termination of this Agreement.
9. The respective indemnities, agreements, representations,
warranties and other statements of the Company, Panhandle and the several
Initial Purchasers, as set forth in this Agreement or made by or on behalf of
them, respectively, pursuant to this Agreement, shall remain in full force and
effect, regardless of any investigation (or any statement as to the results
thereof) made by or on behalf of any Initial Purchaser or any controlling person
of any
-17-
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Initial Purchaser, the Company or Panhandle, or any officer, director or
controlling person of the Company or Panhandle, and shall survive delivery of
and payment for the Notes.
10. Conditions of Initial Purchaser's Obligations: The several
obligations of the Initial Purchasers shall be subject to the condition that all
representations and warranties and other statements of the Company herein are,
at and as of the Closing Date, true and correct, the condition that the Company
shall have performed all of its obligations hereunder theretofore to be
performed, and the following additional conditions:
(a) That all legal proceedings to be taken in connection with
the issue and sale of the Senior Notes shall be reasonably satisfactory in form
and substance to Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP, New York, New York,
counsel to the Initial Purchasers.
(b) That, at the Closing Date, the Initial Purchasers shall be
furnished with the following opinions, dated the Closing Date:
(i) Opinion of Xxxxxxx X. XxxXxxxxx, Esq., as special
counsel to the Company and Panhandle, substantially to the effect
set forth in Exhibit A to this Agreement; and
(ii) Opinion of Skadden, Arps, Slate, Xxxxxxx & Xxxx
LLP, of New York, New York, counsel to the Initial Purchasers,
substantially to the effect set forth in Exhibit B to this
Agreement.
(c) That on the date of the Preliminary Offering Memorandum and
on the Closing Date the Initial Purchasers shall have received a letter from
each of Xxxxxx Xxxxxxxx LLP, Deloitte & Touche LLP and KPMG LLP in form and
substance satisfactory to the Initial Purchasers, dated as of such respective
dates, (i) confirming that they are independent public accountants within the
meaning of the Act and the applicable rules and regulations adopted by the
Commission thereunder, (ii) stating that in their opinion the financial
statements examined by them and included or incorporated by reference in the
Offering Memorandum complied as to form in all material respects with the
applicable accounting requirements of the Commission, including the applicable
rules and regulations adopted by the Commission, and (iii) covering, as of a
date not more than three business days prior to the date of such letter, such
other matters as the Initial Purchasers reasonably request.
(d) That, between the date of the execution of this Agreement
and the Closing Date, no material and adverse change shall have occurred in the
business, properties or financial condition of each of the Company, Panhandle
and their respective Subsidiaries, taken as a whole, which, in the judgment of
the Initial Purchasers, impairs the marketability of the Senior Notes (other
than changes referred to in or contemplated by the Offering Memorandum).
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(e) That, at the Closing Date, each of the Company and Panhandle
shall have delivered to the Initial Purchasers a certificate of an executive
officer of each of the Company and Panhandle to the effect that, to the best of
his or her knowledge, information and belief, (i) there shall have been no
material adverse change in the business, properties or financial condition of
each of the Company and Panhandle from that set forth in the Offering Memorandum
(other than changes referred to in or contemplated by the Offering Memorandum);
(ii) the representations and warranties of each of the Company and Panhandle
herein at and as of the Closing Date are true and correct; and (iii) each of the
Company and Panhandle has complied with all agreements and satisfied all
conditions on their part to be per formed or satisfied at or prior to the
Closing Date.
(f) That each of the Company and Panhandle shall have executed
and delivered the Registration Rights Agreement.
(g) That Panhandle shall have executed and delivered the
Supplemental Agreement, dated as of March 29, 1999, among Panhandle, the Company
and the Initial Purchasers.
(h) That the Company shall have performed such of its
obligations under this Agreement as are to be performed at or before the Closing
Date by the terms hereof.
(i) That the Company shall have complied with the provisions of
Section 5(c) hereof with respect to the furnishing of Offering Memorandum on the
Business Day next succeeding the date of this Agreement;
(j) That any additional documents or agreements reasonably
requested by the Initial Purchasers or their counsel to permit the Initial
Purchasers to perform their obligations or permit their counsel to deliver
opinions hereunder shall have been provided to them.
(k) That between the date of the execution of this Agreement and
the Closing Date there has been no downgrading of the investment ratings of any
of the Company's or Panhandle's securities by Standard & Poor's Ratings Group,
Xxxxx'x Investors Service, Inc. or Duff & Xxxxxx Credit Rating Co., and neither
the Company nor Panhandle shall not have been placed on "credit watch" or
"credit review" with negative implications by any of such statistical rating
organizations if any of such occurrences shall, in the judgment of the Initial
Purchasers, after reasonable inquiries on the part of the Initial Purchasers,
impair the marketability of the Senior Notes.
(l) That the acquisition and reorganization of the Panhandle
Companies (as defined in the Offering Memorandum) by the Company, as described
in the Offering Memorandum, shall have been consummated on the Closing Date.
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11. Effectiveness and Termination of Agreement; Initial Purchaser
Default:
(a) This Agreement shall become effective upon the execution and
delivery of this Agreement by the parties hereto.
(b) This Agreement may be terminated at any time prior to the
Closing Date by the Initial Purchasers if, prior to such time, any of the
following events shall have occurred: (i) a suspension or material limitation in
trading in securities generally on the New York Stock Exchange; (ii) a
suspension or material limitation in trading in Panhandle's secu rities on the
New York Stock Exchange; (iii) a general moratorium on commercial banking
activities declared by either Federal or New York State authorities; or (iv) the
outbreak or escalation of hostilities involving the United States or the
declaration by the United States of a national emergency or war, if the effect
of any such event specified in this Clause (iv) in the judgment of the Initial
Purchasers makes it impracticable or inadvisable to proceed with the public
offering or the delivery of the Senior Notes on the terms and in the manner
contem plated in the Offering Memorandum.
If the Initial Purchasers elect to terminate this Agreement, as
provided in this Section 11, DLJ will promptly notify the Company by telephone
or telecopy, confirmed by letter. If this Agreement shall not be carried out by
any Initial Purchaser for any reason per mitted hereunder, or if the sale of the
Securities to the Initial Purchaser as herein contemplated shall not be carried
out because either the Company is not able to comply with the terms hereof, the
Company shall not be under any obligation under this Agreement and shall not be
liable to any Initial Purchaser or to any member of any selling group for the
loss of anticipated profits from the transactions contemplated by this Agreement
and the Initial Purchaser shall be under no liability to the Company nor be
under any liability under this Agreement to one another.
(c) If on the Closing Date any one or more of the Initial
Purchasers shall fail or refuse (otherwise than for some reason sufficient to
justify in accordance with the terms hereof, the termination of its obligations
hereunder) to purchase the Senior Notes which it or they have agreed to purchase
hereunder on such date and the aggregate principal amount of the Senior Notes
which such defaulting Initial Purchaser or Initial Purchasers, as the case may
be, agreed but failed or refused to purchase is not more than one-tenth of the
aggregate principal amount of the Senior Notes to be purchased on such date by
all Initial Purchasers, each non-defaulting Initial Purchaser shall be obligated
severally, in the proportion which the principal amount of the Senior Notes set
forth opposite its name in Schedule A bears to the aggregate principal amount of
the Senior Notes which all the non-defaulting Initial Purchasers, as the case
may be, have agreed to purchase, or in such other proportion as you may specify,
to purchase the Senior Notes which such defaulting Initial Purchaser or Initial
Purchasers, as the case may be, agreed but failed or refused to purchase on such
date; provided that in no event shall the aggregate principal amount of the
Senior Notes which any Initial Purchaser has agreed to purchase pursuant to
Section 2 hereof be increased pursuant to this Section 11(c) by an
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amount in excess of one-ninth of such principal amount of the Senior Notes
which such Initial Purchaser agreed to purchase without the written consent of
such Initial Purchaser. If on the Closing Date any Initial Purchaser or Initial
Purchasers shall fail or refuse to purchase the Senior Notes and the aggregate
principal amount of the Senior Notes with respect to which such default occurs
is more than one-tenth of the aggregate principal amount of the Senior Notes to
be purchased by all Initial Purchasers and arrangements satisfactory to the
Initial Purchasers and the Company for purchase of such Senior Notes are not
made within 36 hours after such default, this Agreement will terminate without
liability on the part of any non-defaulting Initial Purchaser and the Company.
In any such case which does not result in termination of this Agreement, either
you, the Company or Panhandle shall have the right to postpone the Closing Date,
but in no event for longer than seven days, in order that the required changes,
if any, in the Offering Memorandum or any other documents or arrangements may be
effected. Any action taken under this paragraph shall not relieve any defaulting
Initial Purchaser from liability in respect of any default of any such Initial
Purchaser under this Agreement.
(d) Notwithstanding the foregoing, the provisions of Sections
5(e), 5(i), 8 and 9 shall survive any termination of this Agreement.
12. Miscellaneous: Notices given pursuant to any provision of this
Agreement shall be addressed as follows: (i) if to the Company, to c/o CMS
Energy Corporation, 000 Xxxx Xxxxxx Xxxxx, Xxxxxxxx, Xxxxxxxx 00000, Attention:
Corporate Secretary, and (ii) if to the Initial Purchasers or DLJ, to Xxxxxxxxx,
Xxxxxx & Xxxxxxxx Securities Corporation, 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, Attn: Xxxx Xxxxxx (000) 000-0000, or in any case to such other address as
the person to be notified may have requested in writing.
Except as otherwise provided, this Agreement has been and is made
solely for the benefit of and shall be binding upon the Company and the Initial
Purchasers, the Initial Purchasers' directors and officers, any controlling
persons referred to herein, and their respective successors and assigns, all as
and to the extent provided in this Agreement, and no other person shall acquire
or have any right under or by virtue of this Agreement. The term "successors and
assigns" shall not include a purchaser of any of the Senior Notes from an
Initial Purchaser merely because of such purchase.
This Agreement shall be governed and construed in accordance with
the laws of the State of New York.
This Agreement may be signed in various counterparts which
together shall constitute one and the same instrument.
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Please confirm that the foregoing correctly sets forth the
agreement among the Company and the Initial Purchasers.
Very truly yours,
CMS PANHANDLE HOLDING
COMPANY
By: /s/ Xxxx X. Xxxxxx
--------------------------------------------
Name: Xxxx X. Xxxxxx
Title: Vice President and
Chief Financial Officer
Accepted: March 23, 1999
Xxxxxxxxx, Xxxxxx & Xxxxxxxx
Securities Corporation
Barclays Capital Inc.
Chase Securities Inc.
NationsBanc Xxxxxxxxxx Securities LLC
First Chicago Capital Markets, Inc.
Xxxxxxx Xxxxx Xxxxxx Inc.
XX Xxxxx Securities Corporation
By: XXXXXXXXX, XXXXXX & XXXXXXXX
SECURITIES CORPORATION
By: /s/ Xxxxx Xxxxx
------------------------------
Name: Xxxxx Xxxxx
Title: Vice President
23
SCHEDULE A
Initial Purchaser Principal Principal Principal
----------------- Amount of Amount of Amount of
2004 Notes 2009 Notes 2029 Notes
to be to be to be
Purchased Purchased Purchased
--------- --------- ---------
Xxxxxxxxx, Xxxxxx & Xxxxxxxx $118,800,000 $79,200,000 $118,800,000
Securities Corporation
Barclays Capital Inc. 51,300,000 34,200,000 51,300,000
Chase Securities Inc. 41,550,000 27,700,000 41,550,000
NationsBanc Xxxxxxxxxx
Securities LLC 41,550,000 27,700,000 41,550,000
First Chicago Capital Markets, 15,600,000 10,400,000 15,600,000
Xxxxxxx Xxxxx Xxxxxx Inc. 15,600,000 10,400,000 15,600,000
XX Xxxxx Securities
Corporation 15,600,000 10,400,000 15,600,000
------------ ------------ -----------
Total $300,000,000 $200,000,000 $300,000,000
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