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Exhibit 1
DEALER MANAGER AGREEMENT
________, 1998
Xxxxxx Brothers Inc.
3 World Financial Center
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxxxx Xxxxx & Co.
Xxxxxxx Xxxxx, Xxxxxx Xxxxxx & Xxxxx Incorporated
World Financial Center
Xxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Ladies and Gentlemen:
TU Acquisitions plc ("the Company"), proposes to offer to purchase
(the "Offer") all of the outstanding shares ("TEG Shares") and/or American
Depository Securities ("TEG ADSs" and, hereinafter, together with the TEG
Shares, the "TEG Securities") of The Energy Group PLC ("TEG") for cash, or,
alternatively, in whole or in part, for notes issuable by the Company to
holders of TEG Securities other than citizens of the United States and certain
others ("Loan Notes") or for shares of the Common Stock, without value, (the
"TUC Stock") of Texas Utilities Company ("Texas Utilities") to be exchanged for
TEG Securities representing an aggregate of not to exceed [106,073,000] TEG
Shares. The offer to exchange TUC Stock for TEG Shares is herein referred to
as the "Exchange Offer" and any exchange of TUC Stock for TEG Securities
pursuant to the Exchange Offer is herein referred to as an "Exchange".
The Company hereby confirms its agreement with Xxxxxx Brothers Inc.
and Xxxxxxx Xxxxx, Xxxxxx Xxxxxx & Xxxxx Incorporated (the "Co-Dealer
Managers"), as follows:
1. Registration Statement, Prospectus and Offering Materials.
The Company has filed with the Securities and Exchange Commission (the
"Commission"), under the Securities Act of 1933, as amended, and the rules and
regulations of the Commission promulgated thereunder (collectively, the
"Securities Act"), a registration statement on Form S-4 covering the
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registration of the TUC Stock, including the related preliminary prospectus
(the "prospectus"). Such registration statement, including the exhibits
thereto and any documents incorporated by reference therein, as amended at the
time it becomes effective or as thereafter amended or supplemented from time to
time, is herein called the "Registration Statement". The final prospectus
included in the Registration Statement (including any documents incorporated in
the prospectus by reference) is herein called the "Prospectus", except that if
the final prospectus furnished to the Co-Dealer Managers for use in connection
with the Offer differs from the prospectus set forth in the Registration
Statement (whether or not such prospectus is required to be filed pursuant to
Rule 424(b)), the term "Prospectus" shall refer to the final prospectus
furnished to the Co-Dealer Managers for such use. The terms "supplement" and
"amendment" or "amend" as used herein with respect to the Prospectus shall
include all documents deemed to be incorporated by reference in the Prospectus
that are filed subsequent to the date of the Prospectus and prior to the
termination of the Offer by the Company with the Commission pursuant to the
Securities Exchange Act of 1934, as amended (the "Exchange Act").
The Registration Statement, prospectus, Prospectus, the Texas Utilities
Company Recommended Cash Offer for The Energy Group PLC (the "Offering
Document") and the related letters from the Co-Dealer Managers to securities
brokers, dealers, commercial banks, trust companies and other nominees, letters
to beneficial owners of TEG Securities, letters of transmittal (the "Letters of
Transmittal"), notices of guaranteed delivery (the "Notices of Guaranteed
Delivery") and any newspaper announcements, press releases and other offering
materials and information the Company may use or prepare, approve or authorize
for use in connection with the Offer, as amended or supplemented from time to
time, are herein collectively referred to as the "Offering Materials".
2. Agreement to Act as Co-Dealer Managers. (a) The Company
intends to commence the Offer as soon as practicable by publicly
announcing its commencement and by mailing, or causing to be mailed on
its behalf, copies of the Offering Document, the related Letters of
Transmittal and such of the other Offering Materials as is required or
as the Company elects to each holder of TEG Securities (the date of
the commencement of such mailing being herein called the "Commencement
Date"). The Company intends to commence the Exchange Offer
alternative as soon as practicable after the Registration Statement
becomes effective under the Securities Act by mailing the Prospectus
and such of the other Offering Materials as is required or as the
Company elects to each holder of TEG Securities (the date of the
commencement of such mailing being herein called the "Exchange
Commencement Date").
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(b) The Company retains the Co-Dealer Managers to advise
it with respect to the terms and timing of the Offer in the United
States, including the Exchange Offer, and to assist it in the
preparation of the Offering Materials and retains and authorizes the
Co-Dealer Managers to act as co-dealer managers in the United States
and to assist the Company with the solicitation of purchases of the TEG
Securities and Exchanges in the United States (each a "Solicitation"
and collectively the "Solicitations"). On the basis of the
representations, warranties and agreements of the Company herein
contained and subject to and in accordance with the terms and
conditions hereof and of the Offering Materials, the Co-Dealer Managers
agree to advise the Company with respect to the terms and timing of the
Offer in the United States, including the Exchange Offer, and to act as
co-dealer managers in connection with the Offer in the United States,
including the Exchange Offer, and to assist the Company with the
Solicitations in the United States. The Co-Dealer Managers agree to
use their reasonable best efforts to solicit Exchanges and purchases of
TEG Securities. The Co-Dealer Managers shall have no obligation as
dealer managers to purchase TEG Securities in connection with the
Offer.
(c) The Company shall furnish the Co-Dealer Managers as
soon as practicable after the date hereof (to the extent not
previously furnished), with such information as is available to the
Company as to the names of persons who were the holders of record or,
to the extent available to the Company, the beneficial owners of the
TEG Securities as of a recent date, together with their addresses, and
the number of TEG Securities held by them. Additionally, the Company
shall use its best efforts to update, such information from time to
time during the term of this Agreement as may be reasonably requested
by the Co-Dealer Managers. Except as otherwise provided herein, the
Co-Dealer Managers agree to use such information only in connection
with the Solicitations. The Co-Dealer Managers shall act hereunder as
independent contractors and nothing herein contained shall make the
Co-Dealer Managers agents of the Company in connection with any
Solicitation. Nothing contained in this Agreement shall constitute
the Co-Dealer Managers partners of or joint venturers with the
Company. The obligations of the Co-Dealer Managers hereunder are
several and not joint.
(d) The Company authorizes the Co-Dealer Managers to use
the Offering Materials in connection with the Solicitations and for
such period of time as any Offering Materials are required by law to
be delivered in connection therewith. The Co-Dealer Managers shall
not have any obligation to cause any Offering Materials to be
transmitted generally to the holders of the TEG Securities. The
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Co-Dealer Managers agree not to give any written information and not
to make any representations to holders of the TEG Securities in
connection with any Solicitation that are inconsistent with the
Offering Materials. The Company agrees that it will not use or
furnish to any person Offering Materials that have been amended after
the date hereof without the prior approval of the Co-Dealer Managers,
which approval shall not be unreasonably withheld.
(e) The Company authorizes the Co-Dealer Managers to
communicate with any information agent (each an "Information Agent")
or exchange agent (each a "U.S. Depositary") appointed by the Company
to act in such capacity in connection with the Offer with respect to
matters relating to the Offer.
(f) The Company agrees that any reference to any
Co-Dealer Manager in any Offering Materials or in any newspaper
announcement or press release or other document or communication is
subject to such Co-Dealer Manager's prior consent, which consent shall
not be unreasonably withheld.
3. Compensation. The Company will pay to the Co-Dealer Managers
for services rendered and to be rendered by them in connection with the Offer
only such fees and upon such terms as are set forth in a separate letter
agreement.
4. Certain Covenants of Texas Utilities and the Company.
I. Until termination of the Exchange Offer, Texas Utilities covenants with the
Co-Dealer Managers:
(a) To use its best efforts to cause the Registration
Statement, including any post-effective amendment thereto, to become
effective and to notify the Co-Dealer Managers immediately and, if
requested by any Co-Dealer Manager, to confirm the notice in writing,
(i) when any post-effective amendment to the Registration Statement
shall have become effective, or any supplement to the Prospectus or
any amended Prospectus or any amended or additional Offering Materials
shall have been filed, (ii) of the receipt of any comments from the
Commission relating to the Exchange Offer, (iii) of any request by the
Commission to amend the Registration Statement or amend or supplement
the Prospectus or the other Offering Materials or for additional
information relating to the Exchange Offer and (iv) of (A) the
issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or (B) the issuance by the
Commission of any order preventing or suspending the use of any of the
Offering Materials or (C) the suspension of the qualification of the
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TUC Stock for offering or sale in connection with the Exchange Offer
in any jurisdiction, (D) the institution or threatening of any
proceedings for any of such purposes or (E) the occurrence of any
event which could cause Texas Utilities to withdraw, rescind,
terminate or modify the Exchange Offer or would permit the Company to
exercise any right not to accept the TEG Securities tendered pursuant
to the Exchange Offer. Texas Utilities will use its reasonable best
efforts to prevent the issuance of any such stop order, the issuance
of any order preventing or suspending such use and the suspension of
any such qualification and, if any such order is issued or
qualification suspended, to obtain the lifting of such order or
suspension at the earliest practicable time.
(b) Prior to the termination of the Exchange Offer,
before amending or supplementing the Registration Statement or the
Prospectus, to furnish copies of drafts to, and consult with, the
Co-Dealer Managers and their counsel within a reasonable time in
advance of filing with the Commission of any amendment or supplement
to the Registration Statement, the Prospectus or the other Offering
Materials. Texas Utilities shall not file any such amendment or
supplement to which counsel for the Co-Dealer Managers shall
reasonably object; provided, however, that the foregoing shall not
apply to any of the Texas Utilities' filings with the Commission
required to be filed pursuant to Section 13(a), 13(c), 14 or 15(d) of
the Exchange Act, copies of which such filings Texas Utilities will
cause to be delivered to each Co-Dealer Manager promptly after being
transmitted for filing with the Commission.
(c) To furnish promptly to each Co-Dealer Manager,
without charge, one signed copy of the Registration Statement, all
amendments thereto and any other filing with the Commission in
connection with the Exchange Offer, whether filed before or after the
Registration Statement becomes effective.
(d) To furnish promptly to each Co-Dealer Manager,
without charge, from time to time until the effective date of the
Registration Statement, as many copies of each preliminary prospectus
as the Co-Dealer Managers may reasonably request, and Texas Utilities
hereby consents to the use of such copies for purposes permitted by
the Securities Act and the Exchange Act. Texas Utilities will furnish
promptly to each Co-Dealer Manager, without charge, as soon as the
Registration Statement shall have become effective and during the
period mentioned in the second sentence of Section 4(e) below such
number of copies of the Prospectus and the other Offering Materials
(as supplemented
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or amended) as such Co-Dealer Manager may reasonably request and will
cause all amendments and supplements filed with the Commission to be
distributed to holders of TEG Securities as may be required by the
Securities Act and the Exchange Act.
(e) To comply in all material respects with the
Securities Act and, the Exchange Act, in connection with the Offering
Materials, the Exchange Offer and the transactions contemplated hereby
and thereby, as applicable. If at any time when the Prospectus is
required by the Securities Act or Exchange Act to be delivered in
connection with any Solicitation or Exchange any event shall occur or
condition shall exist as a result of which it is necessary, in the
opinion of Counsel for the Co-Dealer Managers or counsel for Texas
Utilities, to amend the Registration Statement or amend or supplement
the Prospectus or any other Offering Materials in order that the
Prospectus or such other Offering Materials will not include an untrue
statement of a material fact or omit to state a material fact
necessary in order to make the statements in the Prospectus or such
other Offering Materials, in the light of the circumstances under
which they were made, not misleading or if, in the opinion of either
such counsel, it shall be necessary to amend the Registration
Statement or amend or supplement the Prospectus or any other Offering
Materials to comply with the requirements of the Securities Act or
Exchange Act, Texas Utilities will promptly prepare, file with the
Commission, subject to Section 4(I)(b) of this Agreement, and furnish,
at its own expense, to each Co-Dealer Manager and to the dealers
(whose names and address will be furnished to the Company by the
Co-Dealer Managers) to which TUC Stock may have been exchanged, such
amendment or supplement as may be necessary to correct such untrue
statement or omission or to make the Registration Statement or the
Prospectus or such other Offering Materials comply with such
requirements.
(f) To endeavor, in cooperation with the Co-Dealer
Managers, to qualify the TUC Stock for offering and sale in connection
with the Exchange Offer under the applicable securities or Blue Sky
laws of such jurisdictions as the Company may elect and to maintain
such qualifications in effect for such time as may be required for the
consummation of the Exchange Offer; provided, however, that Texas
Utilities shall not be obligated to file any general consent to
service of process or to qualify as a foreign corporation or as a
dealer in securities in any jurisdiction in which it is not so
qualified or to subject itself to taxation in respect of doing
business in any jurisdiction in which it is not otherwise so subject
or to meet any other requirements deemed by Texas Utilities to be
unduly burdensome; provided further that the Co-Dealer Managers shall
not be obligated
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to solicit tenders in jurisdictions where the TUC Stock is not
qualified for offer and sale. Texas Utilities will file such
statements and reports as may be required by the laws of each
jurisdiction in which the TUC Stock has been qualified as above
provided.
(g) To make generally available to its security holders
as soon as practicable an earnings statement of Texas Utilities
covering a twelve-month period beginning on the first day of the first
full fiscal quarter after the date of this Agreement, which earning
statement shall satisfy the provisions of Section 11(a) of the
Securities Act.
(h) To use its best efforts to effect the listing of the
TUC Stock on the New York Stock Exchange ("NYSE"), subject to official
notice of issuance, as soon as practicable after the date hereof.
(i) To timely file any report or other document required
to be filed by Texas Utilities with the Commission pursuant to Section
13, 14 or 15 of the Exchange Act during the period of time referred to
in the second sentence of Section 4(e) hereof.
II. The Company and, with respect to (b) and (c) below, Texas Utilities
covenant with the Co-Dealer Managers:
(a) Prior to the termination of the Offer, before any
circulation of an amended or supplemented Offering Document, to
furnish copies of drafts to, and consult with, the Co-Dealer Managers.
(b) To furnish promptly to each Co-Dealer Manager, without
charge, from time to time until the termination of the Offer, as many
copies of the Offering Document, as amended, as the Co-Dealer Managers
may reasonably request, and the Company and Texas Utilities hereby
consent to the use of such copies for purposes permitted by the
Securities Act and the Exchange Act. The Company or Texas Utilities
will furnish promptly to each Co-Dealer Manager, without charge, until
termination of the Offer, such number of copies of the Offering
Document and the other Offering Materials (as supplemented or amended)
as such Co-Dealer Manager may reasonably request and will cause all
amendments and supplements to be distributed to holders of TEG
Securities as may be required by applicable law.
(c) To pay all costs and expenses incurred in connection
with in connection with this Agreement and the Solicitations including,
without limitation, (i) the
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preparation, printing and filing of the Registration Statement
(including financial statements and exhibits), as originally filed and
as amended, the preliminary prospectuses, the Prospectus and the other
Offering Materials and any amendments or supplements to any of the
foregoing, and the cost of furnishing copies thereof to the Co-Dealer
Managers, (ii) the preparation and distribution of this Agreement,
certificates for the TUC Stock and any Blue Sky surveys (including
fees of counsel to the Co-Dealer Managers not to exceed $5,000) and
the printing of certificates for the TUC Stock, (iii) the distribution
of the Offering Materials to the holders of the TEG Securities, (iv)
the fees and disbursements of counsel to Texas Utilities, counsel for
the Co-Dealer Managers and the Company's and Texas Utilities'
accountants, (v) the qualification of the TUC Stock under the
applicable securities laws in accordance with Section 4(I)(f) and any
filing for review of the Exchange Offer with the NASD (including
filing fees and fees and disbursements of Counsel for the Co-Dealer
Managers in connection with such filing with the NASD), (vi) the fees
and expenses of the Transfer Agent, the Registrar, the Information
Agent and the U.S. Depositary, (vii) the reasonable out-of-pocket
expenses of the Co-Dealer Managers and (viii) all other costs and
expenses incident to the Solicitations incurred by the Company and
Texas Utilities and its subsidiaries. The Company and Texas Utilities
agree to pay all of the aforementioned costs and expenses whether or
not the Offer is consummated.
(d) To advise or cause the Exchange Agent to advise the
Co-Dealer Managers at 5:00 P.M., New York City time, or as promptly as
practicable thereafter, daily (or more frequently if requested), by
telephone or facsimile transmission, as of 4:00 P.M. on such day with
respect to TEG Securities that have been tendered as follows: (i) the
number of TEG Shares and TEG ADSs validly tendered represented by
certificates physically held by the Exchange Agent (or for which the
Exchange Agent has received confirmation of receipt of book-entry
transfer of such TEG Securities into the U.S. Depositary's account at
a book-entry transfer facility pursuant to the procedures set forth in
the Offer) on such day; (ii) the number of TEG Shares and TEG ADSs
represented by Notices of Guaranteed Delivery on such day; (iii) the
number of TEG Shares and TEG ADSs withdrawn on such day; (iv) the
cumulative number of TEG Shares and TEG ADSs in categories (i) through
(iii) above; (v) the number of TEG Shares and TEG ADSs tendered for
cash only, (vi) the number of TEG Shares and TEG ADSs tendered for
Loan Notes and (v) the number of TEG Shares and TEG ADSs tendered for
the Exchange.
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On the day following such oral communication, the Company shall
furnish or cause the Exchange Agent to furnish to the Co-Dealer
Managers a written report confirming the above information which has
been communicated orally. The Company shall furnish or cause the
Exchange Agent to furnish to the Co-Dealer Managers such reasonable
information on the tendering holders of TEG Securities as may be
requested from time to time.
(e) To give the Co-Dealer Managers notice of any change
of the expiration time of the Offer (the "Expiration Time") and the
expiration of the Exchange Offer.
5. Representations and Warranties of the Company and Texas
Utilities. The Company, with respect to itself, and Texas Utilities, with
respect to the Company and itself, each represents and warrants and agrees with
each of the Co-Dealer Managers that:
(a) Each preliminary prospectus filed as part of the
Registration Statement as originally filed or as part of any amendment
thereto, or filed pursuant to Rule 424 of the Securities Act, will
comply when so filed, in all material respects, as to form with the
Securities Act and the Exchange Act; the Registration Statement at the
time it becomes effective and the Prospectus and any other Offering
Materials, on the Exchange Commencement Date and on the date on which
the Company commences delivery of the TUC Stock or payment in cash
only or Loan Notes for exchange of the TEG Securities pursuant to the
Exchange Offer (such date, the "Exchange Date"), will comply, in all
material respects, as to form with the Securities Act and the Exchange
Act; the Registration Statement when it becomes effective will not
contain, and the Registration Statement, as amended, if applicable,
when such amendment becomes effective will not contain, any untrue
statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein not
misleading; and as of the Exchange Commencement Date and the Exchange
Date, none of the Prospectus or the other Offering Materials will
contain any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not
misleading, except that the representations and warranties set forth
in this Section 5(a) do not apply to statements or omissions made
based upon and in conformity with information expressly relating to a
Co- Dealer Manager supplied in writing by a Co-Dealer Manager
expressly for use in the Registration Statement, Prospectus, or any
other Offering Materials.
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(b) The Offering Materials at the time they are first
made available to holders of TEG Shares, on the Commencement Date and
on the date on which the Company makes payment in cash only or Loan
Notes for exchange of the TEG Securities pursuant to the Offer, will
comply, in all material respects, with applicable law in the United
Kingdom and elsewhere.
(c) It has the corporate power and authority to make the
Offer and to execute, deliver and perform its obligations under this
Agreement, and this Agreement has been duly authorized, executed and
delivered by it.
(d) The TUC Stock to be issued pursuant to the Exchange
Offer will be duly authorized and, when issued in exchange for TEG
Securities pursuant to the Exchange Offer, will be validly issued and
fully paid and nonassessable, not subject to any preemptive or similar
rights, and will conform in all material respects to all statements
relating thereto contained in the Prospectus.
(e) With respect to the Company, it is a public limited
company, duly authorized by its organizing documents, as amended, to
conduct the business which it is now conducting and to make the Offer.
(f) Its execution and delivery of, and performance of its
obligations under, this Agreement, the issuance by Texas Utilities and
delivery by the Company of the TUC Stock and the Loan Notes and the
consummation of the Exchange Offer and the fulfillment of the terms
herein contemplated will not contravene any provision of applicable
law or the governing documents of the Company or Texas Utilities or
any agreement or other instrument binding upon the Company or Texas
Utilities or any of its subsidiaries or any judgment, order or decree
of any governmental body, agency or court having jurisdiction over the
Company or Texas Utilities or any of its subsidiaries, except for such
contraventions that would not, individually or in the aggregate, have
a material adverse effect on the financial condition or results of
operations of the Company or Texas Utilities, and no consent, approval
or authorization or order of, or qualification with, any governmental
body or agency is required for the performance by the Company or Texas
Utilities of their obligations under this Agreement, the issuance by
Texas Utilities and delivery by the Company of the TUC Stock and the
consummation of the Exchange Offer, except such as will be obtained
under the Securities Act or, the Exchange Act and as may be required
by the securities or Blue Sky laws of the various states or the
securities laws of non-U.S. jurisdictions other than the United
Kingdom in connection with the Exchange Offer.
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(g) Neither the Company nor Texas Utilities is, nor after
giving effect to the consummation of the Exchange Offer, will be, and
neither the Company nor Texas Utilities is directly or indirectly
controlled by, or acting on behalf of any person which is, an
investment company within the meaning of the Investment Company Act of
1940, as amended.
6. Indemnification.
(a) The Company and Texas Utilities jointly and severally
agree to hold harmless and indemnify you and your affiliates and any
officer, director, employee or agent of you or any such affiliates and
any person controlling (within the meaning of Section 20(a) of the
Exchange Act or Section 15 of the Securities Act you or any of such
affiliates (each, a "Co-Dealer Manager Indemnitee") from and against
any and all losses, claims, damages or liabilities, joint or several,
and expenses whatsoever to which they may become subject under any
statute or common law and shall reimburse you and each Co-Dealer
Manager Indemnitee for any and all legal or other expenses (including,
to the extent hereinafter provided, reasonable counsel fees) incurred
in connection with investigating any such losses, claims, damages or
liabilities or in connection with defending any action, insofar as
such losses, claims, damages, liabilities, expenses or actions (A)
arise out of or are based upon (i) any untrue statement or alleged
untrue statement of a material fact contained in the Offering
Materials or any other solicitation material used by the Company or
Texas Utilities or the omission or alleged omission to state in any
such document a material fact required to be stated therein or
necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading (other than
statements or omissions made in reliance upon and in conformity with
information expressly relating to you and furnished by you in writing
to the Company or Texas Utilities expressly for use therein), (ii)
any withdrawal or termination by the Company of, or failure by the
Company to make or consummate, the Offer, (iii) any actions taken or
omitted to be taken by you or any other Co-Dealer Manager Indemnitee
with the consent of the Company or Texas Utilities or in conformity
with actions taken or omitted to be taken by the Company or Texas
Utilities or (iv) any breach by the Company or Texas Utilities of any
representation or warranty, or any failure by the Company or Texas
Utilities to comply with any agreement or covenant, contained in this
Agreement or (B) arise out of, relate to or are in connection with or
are alleged to arise out of, relate to or be in connection with the
Offer, any of the other transactions contemplated by the Offering
Materials or the performance of your services as
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Co-Dealer Managers with respect to the Offer. However, neither the
Company nor Texas Utilities will be obligated to indemnify any other
Co-Dealer Manager Indemnitee for any loss, claim, damage, liability
or expense pursuant to clause (B) of the preceding sentence which has
been determined in a final judgment by a court of competent
jurisdiction to have resulted directly from willful misconduct or
negligence on the part of such other Co-Dealer Manager Indemnitee.
The agreement of the Company and Texas Utilities to so indemnify
contained in this subparagraph (a) shall remain operative and in full
force and effect regardless of any termination of this Agreement or
of any investigation made by or on behalf of the Company, Texas
Utilities, their directors or their officers, or by you or any other
Co-Dealer Manager Indemnitee, and shall survive the termination of
the Offer.
(b) You agree severally and not jointly to indemnify,
defend and hold harmless the Company and Texas Utilities, their
affiliates, officers, directors, employees and agents and each person
who controls the Company or Texas Utilities (within the meaning of
Section 20(a) of the Exchange Act or Section 15 of the Securities Act)
from and against any and all losses, claims, damages or liabilities,
joint or several, to which they or any of them may become subject
under any statute or common law and shall reimburse each of them for
any legal or other expenses (including, to the extent hereinafter
provided, reasonable counsel fees) incurred by them in connection with
investigating any such losses, claims, damages or liabilities or in
connection with defending any actions, insofar as such losses, claims,
damages, liabilities, expenses or actions arise out of or are based
upon any untrue statement or alleged untrue statement of a material
fact contained in the Offering Materials, or the omission or alleged
omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, if
such statement or omission was made in reliance upon and in conformity
with information expressly relating to you and furnished by you to the
Company and Texas Utilities expressly for use therein. Your agreement
to so indemnify contained in this subparagraph (b) shall remain
operative and in full force and effect regardless of any termination
of this Agreement or of any investigation made by or on behalf of the
Company or Texas Utilities, its directors or their officers, or by
you or any other Co-Dealer Manager Indemnitee, and shall survive the
termination of the Offer.
(c) The Company, Texas Utilities and each Co-Dealer
Manager Indemnitee shall, upon the receipt of notice of the
commencement of any action in respect of which indemnity may
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be sought on account of any indemnity agreement contained herein,
promptly give written notice of the commencement thereof to the party
or parties against whom indemnity shall be sought hereunder, but the
omission so to notify such indemnifying party of any such action shall
not relieve such indemnifying party from any liability which it may
have to the indemnified party under this paragraph 6 except to the
extent that it has been prejudiced in any material respect by such
failure and in any event shall not relieve the Company or Texas
Utilities from any other obligation or liability which it may have to
such Co-Dealer Manager Indemnitee otherwise than on account of such
indemnity agreement. In case such notice of any such action shall be
so given, such indemnifying party shall be entitled to participate at
its own expense in the defense, or, if it so elects, to assume the
defense of such action, in which event such defense shall be conducted
by counsel chosen by such indemnifying party and satisfactory to the
indemnified party or parties who shall be defendant or defendants in
such action, and such defendant or defendants shall bear the fees and
expenses of any additional counsel retained by them; but if the
indemnifying party shall elect not to assume the defense of such
action, such indemnifying party will reimburse such indemnified party
or parties for the reasonable fees and expenses of any counsel
retained by them; provided, however, if the defendants in any such
action (including impleaded parties) include both an indemnified party
and the indemnifying party and counsel for the indemnifying party
shall have reasonably concluded that there may be a conflict of
interest involved in the representation by a single counsel of both
the indemnifying party and the indemnified party, the indemnified
party or parties shall have the right to select separate counsel,
satisfactory to the indemnifying party to conduct the defense on
behalf of the indemnifying party (it being understood, however, that
the indemnifying party shall not be liable for the expenses of more
than one separate counsel (in addition to local counsel) representing
the indemnified parties who are parties to such action). The Company,
Texas Utilities and the Co-Dealer Managers agree that without the
other party's prior consent, which consent shall not be unreasonably
withheld, it will not settle, compromise or consent to the entry of
any judgment in any claim in respect of which indemnification may be
sought under the indemnification provision of this Agreement, unless
such settlement, compromise or consent (i) includes an unconditional
release of such other party from all liability arising out of such
claim and (ii) does not include a statement as to or an admission of
fault, culpability or a failure to act by or on behalf of such other
party.
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(d) If the indemnification provided for in subparagraph
(a) or (b) above shall be unenforceable under applicable law, the
indemnifying party agrees to contribute to such indemnified party with
respect to any and all losses, claims, damages, liabilities and
expenses for which each such indemnification provided for in
subparagraph (a) or (b) above shall be unenforceable, in such
proportion as shall be appropriate to reflect (i) the relative fault
of each indemnifying party on the one hand and the indemnified party
on the other in connection with the actions, statements or omissions
which have resulted in such losses, claims, damages, liabilities and
expenses, (ii) the relative benefits received by the Company and Texas
Utilities on the one hand and the Co-Dealer Managers on the other hand
from the Offer as contemplated by this agreement, and (iii) any any
other relevant equitable considerations; provided, however, that no
indemnified party guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any indemnifying party not guilty of such fraudulent
misrepresentation. 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 such indemnifying
party or the indemnified party and each such party's relative intent,
knowledge, access to information and opportunity to correct or prevent
such untrue statement or omission. The Company, Texas Utilities and
you agree that it would not be just and equitable if contributions
pursuant to this subparagraph (d) were to be determined by any method
of allocation which does not take account of the equitable
considerations referred to above.
7. Conditions to Co-Dealer Managers' Obligations. The
obligations of the Co-Dealer Managers hereunder are subject as of the
Commencement Date to the accuracy of the representations and warranties of the
Company and Texas Utilities contained herein or in certificates of any officer
of the Company or Texas Utilities delivered pursuant to the provisions hereof,
to the performance, in all material respects, by the Company and Texas
Utilities of their obligations to be performed hereunder with respect to the
Offer other than the Exchange Offer, and the following additional conditions:
(a) On the Commencement Date, there shall not have been
since the respective date as of which information is given in the
Offering Document, with respect to the Offer, any material adverse
change in the business, property or financial condition of the Company
or Texas Utilities.
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(b) The Co-Dealer Managers shall have received on the
Commencement Date a certificate, dated such date and signed by an
executive officer of each of the Company and Texas Utilities, to the
effect set forth in clause (a) above and to the effect that the
representations and warranties of the Company and Texas Utilities
contained in this Agreement are true and correct in all material
respects as of such date and that the Company and Texas Utilities have
complied in all material respects with all of the agreements and
satisfied in all material respects all of the conditions on its part
to be performed or satisfied on or before such date and that the
Company and Texas Utilities have complied in all material respects
with all of the agreements and satisfied in all material respects all
of the conditions on its part to be performed or satisfied on or
before such date. The officer signing and delivering any such
certificate may rely upon the best of such officer's knowledge as to
proceedings threatened.
(c) On the Commencement Date, the Co-Dealer Managers
shall have received a signed opinion of Xxxxxx Xxxx, United Kingdom
counsel for the Company, dated as of such date, to the effect that:
(i) The Company is a private limited company, duly
authorized by its governing documents, as amended, to conduct
the business which it is now conducting.
(ii) this Agreement has been duly authorized,
executed and delivered by the Company and the Offer and the
other transactions with respect to the Company contemplated by
the Offering Document have been duly authorized by the
Company;
(iii) the Offering Materials comply with the
requirements of all applicable United Kingdom laws;
(iv) other than as stated in the Offering
Document, there are no material pending legal proceedings to
which the Company is a party or of which property of the
Company is the subject which depart from the ordinary routine
litigation incident to the kind of business conducted by the
Company, and to our best knowledge no such proceedings are
contemplated;
(v) such counsel has no reason to believe that the
Offering Materials, as amended or supplemented on the
Commencement
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Date, included an untrue statement of a material fact or
omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading.
With respect to paragraph (v) above, such counsel may state
that it has not independently verified the accuracy, completeness or
fairness of the statements made or included or incorporated by
reference therein and takes no responsibility therefor and that such
opinion is based upon such counsel's examination of the Offering
Materials as amended or supplemented, its investigations made in
connection with the preparation of the Offering Materials and its
participation in conferences with certain officers and employees of
the Company and with representatives of Deloitte & Touche LLP and any
others referred to in such opinion.
(d) On the Commencement Date, the Co-Dealer Managers
shall have received a signed opinion of Xxxxxxx, Xxxxxxxx &
Xxxxxxxxxx, L.L.P., general counsel for Texas Utilities and the
Company, dated as of such date, to the effect that:
(i) Texas Utilities is a corporation duly authorized
by its articles of incorporation, as amended, to conduct the
business which it is now conducting.
(ii) this Agreement has been duly authorized,
executed and delivered by Texas Utilities;
(iii) such counsel has no reason to believe that the
Offering Materials as they may have been amended or
supplemented prior to the date of such counsel's opinion
(except as aforesaid), included or include an untrue statement
of a material fact or omitted or omit to state a material fact
necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not
misleading.
In rendering such opinion, such counsel may rely as to (i)
certain matters of fact on certificates of officers of Texas Utilities
and of public officials and (ii) all matters of New York law on the
opinion of Xxxx & Priest LLP delivered pursuant to Section 7(e) hereof
and may state that such counsel expresses no opinion as to the laws of
any
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jurisdiction other than the State of Texas and the federal law of the
United States.
With respect to paragraph (iii) above, such counsel may state
that it has not independently verified the accuracy, completeness or
fairness of the statements made or included or incorporated by
reference therein and takes no responsibility therefor and that such
opinion is based upon such counsel's examination of the Offering
Materials, as amended or supplemented, its investigations made in
connection with the preparation of the Registration Statement and
Prospectus and its participation in conferences with certain officers
and employees of the Company and Texas Utilities and with
representatives of Deloitte & Touche LLP and any others referred to in
such opinion.
(e) On the Commencement Date, the Co-Dealer Managers
shall have received a signed opinion of Xxxx & Priest LLP, of counsel
for Texas Utilities, dated as of such date, as to the matters
described in Section 7(d)(iii) herein and to the effect that such
counsel confirms its opinion under the caption "Certain United States
Federal Income Tax Consequences" in the Offering Document.
In rendering such opinion, such counsel may rely as to certain
matters of fact on certificates of officers of the Company and of
public officials and may state that such counsel expresses no opinion
as to the laws of any jurisdiction other than the State of New York
and the federal law of the United States.
(f) On the Commencement Date, the Co-Dealer Managers
shall have received from the Company's independent public accountants,
in form and substance satisfactory to the Co-Dealer Managers and dated
as of such date, containing statements and information of the type
ordinarily included in accountants' "comfort letters" to underwriters
with respect to the financial statements and certain financial
information contained in or incorporated by reference into the
Offering Document.
8. Conditions to Co-Dealer Managers' Obligations with Respect to
the Exchange Offer. The obligations of the Co-Dealer Managers hereunder are
subject as of the Exchange Commencement Date and as of the Exchange Date to the
accuracy of the representations and warranties of Texas Utilities contained
herein or in certificates of any officer of Texas Utilities delivered pursuant
to the provisions hereof, to the performance, in all material respects, by
Texas Utilities of its obligations
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to be performed hereunder with respect to the Exchange Offer, and the following
additional conditions:
(a) In connection with the Exchange Offer, on the
Exchange Commencement Date and the Exchange Date, the Registration
Statement shall have become effective under the Securities Act; no
stop order suspending the effectiveness of the Registration Statement
shall be in effect, and no proceedings for such purpose shall be
pending before or, to Texas Utilities' or the Company's knowledge,
threatened by the Commission.
(b) On the Exchange Commencement Date and the Exchange
Date, there shall not have been since the respective date as of which
information is given in the Registration Statement, with respect to
the Exchange, or the Offering Document, with respect to the other
portions of the Offer, any material adverse change in the business,
property or financial condition of Texas Utilities.
(c) The Co-Dealer Managers shall have received on the
Exchange Date and the Exchange Commencement Date (i) a certificate,
dated such date and signed by an executive officer of the Company, to
the effect set forth in clause (b) above and to the effect that the
representations and warranties of the Company contained in this
Agreement are true and correct in all material respects as of such
date and that the Company has complied in all material respects with
all of the agreements and satisfied in all material respects all of
the conditions on its part to be performed or satisfied on or before
such date and (ii) a certificate, dated such date and signed by an
executive officer of Texas Utilities, to the effect that the
representations and warranties of the Company and Texas Utilities
contained in this Agreement are true and correct in all material
respects as of such date and that the Company and Texas Utilities have
complied in all material respects with all of the agreements and
satisfied in all material respects all of the conditions on its part
to be performed or satisfied on or before such date. The officer
signing and delivering any such certificate may rely upon the best of
such officer's knowledge as to proceedings threatened.
(d) On the Exchange Commencement Date and the Exchange
Date, the Co-Dealer Managers shall have received a signed opinion of
Xxxxxxx, Xxxxxxxx & Xxxxxxxxxx, L.L.P., general counsel for Texas
Utilities and the Company, dated as of such date, to the effect that:
(i) Texas Utilities is a corporation duly authorized
by its articles of
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incorporation, as amended, to conduct the business which it is
now conducting;
(ii) this Agreement has been duly authorized,
executed and delivered by Texas Utilities;
(iii) when issued, in exchange for TEG Shares or TEG
ADSs, the TUC Stock will be duly authorized, validly issued,
fully paid and nonassessable;
(iv) the statements made in the Prospectus under the
captions "Description of the Texas Utilities Common Stock"
insofar as such statements constitute summaries of the legal
matters or documents referred to therein, are accurate in all
material respects;
(v) other than as stated in the Registration
Statement and the Prospectus, there are no material pending
legal proceedings to which Texas Utilities is a party or of
which property of Texas Utilities is the subject which depart
from the ordinary routine litigation incident to the kind of
business conducted by Texas Utilities, and to our best
knowledge no such proceedings are contemplated;
(vi) such counsel (1) has no reason to believe that
(a) the Registration Statement, as of its effective date,
included an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or
necessary to make the statements therein not misleading or (b)
the Prospectus, as it may have been amended or supplemented
prior to the date of such counsel's opinion (except as
aforesaid), included or includes an untrue statement of a
material fact or omitted or omits to state a material fact
necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not
misleading; the Registration Statement has become and is
effective under the Securities Act, and (2) is of the opinion
that the Registration Statement and Prospectus as they may
have been amended and supplemented prior to the
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date of such counsel's opinion (except as aforesaid), as of
their respective effective or issue dates, comply as to form in
all material respects with the Securities Act.
In rendering such opinion, such counsel may rely as to (i)
certain matters of fact on certificates of officers of Texas Utilities
and of public officials and (ii) all matters of New York law on the
opinion of Xxxx & Priest LLP delivered pursuant to Section 8(e) hereof
and may state that such counsel expresses no opinion as to the laws of
any jurisdiction other than the State of Texas and the federal law of
the United States.
With respect to paragraph (vi)(1) above, such counsel may
state that it has not independently verified the accuracy,
completeness or fairness of the statements made or included or
incorporated by reference therein and takes no responsibility therefor
and that such opinion is based upon such counsel's examination of the
Registration Statement, the Prospectus as amended or supplemented and
any documents incorporated by reference thereto, its investigations
made in connection with the preparation of the Registration Statement
and Prospectus and its participation in conferences with certain
officers and employees of Texas Utilities and with representatives of
Deloitte & Touche LLP and any others referred to in such opinion.
(e) On the Exchange Commencement Date and the Exchange
Date, the Co-Dealer Managers shall have received a signed opinion of
Xxxx & Priest LLP, of counsel for Texas Utilities, dated as of such
date, as to the matters described in Section 8(d)(vi) herein, the
effectiveness of the Registration Statement and to the effect that
such counsel confirms its opinion under the caption "Certain United
States Federal Income Tax Consequences" in the Offering Document.
(f) The Co-Dealer Managers shall have received the
favorable opinion of counsel for the Co-Dealer Managers, dated as of
the Exchange Commencement Date, covering the incorporation and legal
existence of Texas Utilities, the issuance and delivery of the TUC
Stock, this Agreement, the Registration Statement, the Prospectus and
such other related matters as the Co-Dealer Managers may require. In
giving such opinion such counsel may rely, as to all matters governed
by the laws of the State of Texas, upon the opinion of Xxxxxxx,
Xxxxxxxx & Xxxxxxxxxx, L.L.P. Such counsel may also state that,
insofar as such opinion involves factual matters, they have relied, to
the extent they deem proper,
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upon certificates of officers of Texas Utilities and certificates of
public officials.
(g) On the Exchange Commencement Date, the Co-Dealer
Managers shall have received from Texas Utilities' independent public
accountants, in form and substance satisfactory to the Co-Dealer
Managers and dated as of such date, containing statements and
information of the type ordinarily included in accountants' "comfort
letters" to underwriters with respect to the financial statements and
certain financial information contained in or incorporated by
reference into the Prospectus.
(h) At the Exchange Date, the Co-Dealer Managers shall
have received from Texas Utilities' independent public accountants, in
form and substance satisfactory to the Co-Dealer Managers and dated as
of such dates, to the effect that such accountants reaffirm the
statements made in the letter furnished pursuant to Section 8(g).
(i) By the Exchange Date, Texas Utilities shall have
entered into appropriate agreements with the Information Agent and the
Exchange Agent for purposes of the Exchange Offer.
9. Termination. (a) This Agreement shall terminate upon the
earliest to occur of (i) the last Closing Date with respect to TEG Shares and
TEG ADSs, (ii) the date on which the Co-Dealer Managers give notice to the
Company that any of the conditions specified in Section 7 have not been
fulfilled as of any date such conditions are required to be fulfilled pursuant
to Section 7 or (iii) the date on which the Company terminates or withdraws the
Offer for any reason (the earliest to occur of clauses (i), (ii) or (iii) being
referred to as the "Termination Date").
(b) Notwithstanding termination of this Agreement pursuant to
subsection (a) of this Section 9, the obligations of the Company to compensate
the Co-Dealer Managers pursuant to Section 3, the representations and
warranties contained in Section 5 and the provisions of Section 6 shall survive
any termination of this Agreement.
10. Notices. All notices and other communications hereunder shall
be in writing and shall be deemed to have been duly given if delivered, mailed
or transmitted by any standard form of telecommunication. Notices to the
Co-Dealer Managers shall be directed to Xxxxxx Brothers Inc., 3 World Financial
Center, 000 Xxxxx Xxxxxx, Xxx Xxxx, XX 00000, attention Xxxx Xxxxx and Xxxxxxx
Xxxxx & Co., World Financial Center, Xxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx
00000-0000, attention Xxxx Xxxxxxxxx, with a copy to, counsel for the Co-Dealer
Managers and notices to
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the Company or Texas Utilities shall be directed to either of them c/o Texas
Utilities Company, 0000 Xxxxx Xxxxxx, Xxxxxx, Xxxxx 00000, attention Treasurer.
Any notice under Section 6 hereof may be made by telex or telephone, but if so
made, shall be subsequently confirmed promptly in writing.
11. Tombstone. The Company acknowledges that the Co-Dealer
Managers may, with the prior review and approval of the Company, which approval
shall not be unreasonably withheld, place an announcement in such newspapers
and periodicals as the Co-Dealer Managers may choose, stating that the
Co-Dealer Managers are or were acting as co-dealer managers and financial
advisors to the Company in connection with the Offer. The costs relating to
any such tombstone shall be borne by the Co-Dealer Managers.
12. Survival of Certain Provisions. The representations,
warranties, indemnities and agreements of the Company will remain operative and
in full force and effect regardless of any investigation made by or on behalf
of any Co-Dealer Manager or any affiliate or controlling person thereof and,
subject to Section 8(b), will survive the consummation of the Offer.
13. Governing Law. This Agreement shall be construed in
accordance with and governed by the laws of the State of New York, without
giving effect to principles of conflicts of laws.
14. Counterparts. This Agreement may be executed in one or more
counterparts, and by different parties hereto on separate counterparts, each of
which counterparts, when so executed and delivered, shall be deemed to be an
original and all of which counterparts, taken together, shall constitute one
and the same Agreement.
15. Successors. This Agreement is made solely for the benefit of
the Co-Dealer Managers, the Company and, to the extent expressed, the parties
indemnified pursuant to Section 6, and no other persons shall acquire or have
any right under or by virtue of this Agreement. Nothing in this Agreement,
expressed or implied, is intended to confer on any person other than the
parties hereto or their respective successors and assigns, and, to the extent
expressly set forth herein, the parties indemnified pursuant to Section 6
hereof, any rights or remedies under or by reason of this Agreement. Without
limiting the generality of the foregoing, the parties acknowledge that nothing
in this Agreement, expressed or implied, is intended to confer on holders of
the securities of the Company or creditors of the Company or the respective
successors and assigns of such creditors, any rights or remedies under or by
reason of this Agreement.
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If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us a counterpart hereof, whereupon this
instrument will become a binding agreement among the Company, Texas Utilities
and the Co-Dealer Managers in accordance with its terms.
Very truly yours,
TEXAS UTILITIES COMPANY
By:
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TU Acquisitions PLC
By:
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Confirmed and accepted as of
the date first above written:
XXXXXX BROTHERS INC.
By:
---------------------------------
XXXXXXX XXXXX & CO.
XXXXXXX LYNCH, PIERCE, XXXXXX
& XXXXX INCORPORATED
By:
---------------------------------
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