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EXHIBIT (1)(c)
CMS ENERGY CORPORATION
DOCS(R) FINANCING PROGRAM
2,000,000 SHARES
(COMMON STOCK, $.01 PAR VALUE)
SALES AGREEMENT
[ ], 2001
DOCS(R) is a registered service xxxx of Xxxxxxx Xxxxxxx Securities Corporation
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THIS SALES AGREEMENT (the "Agreement") dated as of July [ ], 2001
between RCG Equity Finance, a division of Ramius Securities, LLC, having its
principal office at 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (the "Sales
Manager") and CMS Energy Corporation, a corporation organized and existing under
the laws of the State of Michigan (the "Company").
WHEREAS, the Company desires to issue and sell through the Sales
Manager up to 2,000,000 shares (the "Maximum Amount") of its common stock, par
value $.01 per share (the "Stock"), on the terms set forth in Section 3 hereof.
IN CONSIDERATION of the mutual covenants contained in this Agreement,
the Company and the Sales Manager agree as follows:
SECTION 1. Description of Securities. The Company proposes to issue and
sell through the Sales Manager, as sales agent, up to 2,000,000 shares (the
"Shares") of its Common Stock, par value $0.01 per share ("Common Stock") but
not less than the Minimum Amount (as defined below), on the terms set forth in
Section 3 hereof.
SECTION 2. Representations and Warranties of the Company. The Company
represents and warrants to, and agrees with, the Sales Manager on behalf of
itself and its consolidated subsidiaries that:
(a) The Company meets the requirements for use of Form S-3 under the
Securities Act of 1933 (the "Act") and the rules and regulations thereunder (the
"Rules and Regulations"). A registration statement on Form S-3 (Registration No.
333-51932) with respect to the Shares, including a form of prospectus, has been
prepared by the Company in conformity with the requirements of the Act and the
Rules and Regulations and filed with the Securities and Exchange Commission (the
"Commission") and has become effective. Such registration statement and
prospectus may have been amended or supplemented prior to the date of this
Agreement. Any such amendment or supplement was so prepared and filed, and any
such amendment or supplement filed after the effective date of such registration
statement has become effective. No stop order suspending the effectiveness of
the registration statement has been issued, and no proceeding for that purpose
has been instituted or, to the best knowledge of the Company, threatened by the
Commission. Copies of such registration statement and prospectus, any such
amendment or supplement that were filed with the Commission on or prior to the
date of this Agreement have been delivered to the Sales Manager except that
copies delivered to the Sales Manager excluded exhibits to such registration
statement. Such registration statement, as it has been amended, and as it may be
amended in the future, is referred to herein as the "Registration Statement,"
and the final form of prospectus included in the Registration Statement, as
amended or supplemented from time to time, is referred to herein as the
"Prospectus." Any reference herein to the Registration Statement, the
Prospectus, or any amendment or supplement thereto shall be deemed to refer to
and include the documents incorporated (or deemed to be incorporated) by
reference therein, and any reference herein to the terms "amend," "amendment" or
"supplement" with respect to the Registration Statement or Prospectus shall be
deemed to refer to and include the filing after the execution hereof of any
document with the Commission deemed to be incorporated by reference therein.
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(b) Each part of the Registration Statement, when such part became or
becomes effective, and the Prospectus and any amendment or supplement thereto,
on the date of filing thereof with the Commission and at each Closing Date (as
hereinafter defined), conformed or will conform in all material respects with
the requirements of the Act and the Rules and Regulations; each part of the
Registration Statement, when such part became or becomes effective, did not or
will not contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading; and the Prospectus and any amendment or supplement
thereto, on the date of filing thereof with the Commission and at each Closing
Date, did not or will not include an untrue statement of a material fact or omit
to state a material fact necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading; except that the
foregoing shall not apply to statements in or omissions from any such document
in reliance upon, and in conformity with, written information relating to the
Sales Manager furnished to the Company by the Sales Manager, specifically for
use in the Registration Statement, the Prospectus or any amendment or supplement
thereto.
(c) The documents incorporated by reference in the Registration
Statement or the Prospectus, or any amendment or supplement thereto, when they
became effective under the Act or were filed with the Commission under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), as the case
may be, conformed in all material respects with the requirements of the Act or
the Exchange Act, as applicable, and the rules and regulations of the Commission
thereunder, and none of such documents contained an untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading; and any further
documents so filed and incorporated by reference in the Prospectus or any
further amendment or supplement thereto, when such documents become effective or
are filed with the Commission, as the case may be, will conform in all material
respects to the requirements of the Act or the Exchange Act, as applicable, and
the rules and regulations of the Commission thereunder and will not contain an
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not misleading.
(d) The consolidated financial statements of the Company and its
subsidiaries as such term is defined in Rule 405 under the Act ("Subsidiaries"),
together with the related notes and schedules, set forth or incorporated by
reference in the Registration Statement and Prospectus present fairly the
consolidated financial condition and the results of operations and cash flows of
the Company and its consolidated subsidiaries as of the dates indicated or for
the periods therein specified and were prepared in conformity with generally
accepted accounting principles consistently applied throughout the periods
involved (except as otherwise stated therein).
(e) The Company has been duly organized and is validly existing as a
corporation in good standing under the laws of the State of Michigan and has all
requisite authority to own or lease its properties and conduct its business as
described in the Prospectus 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
Prospectus 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 the Company.
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(f) Each significant subsidiary of the Company, as such term is defined
in Rule 405 under the Act (each a "Significant Subsidiary") has been duly
incorporated and is validly existing as a corporation in good standing under the
laws of the jurisdiction of its incorporation, has corporate power and authority
to own, lease and operate its properties and conduct its business as described
in the Registration Statement and Prospectus and is duly qualified as a foreign
corporation to transact business and is in good standing in each jurisdiction in
which such qualification is required, whether by reason of the ownership or
leasing of property or the conduct of business, except where the failure to so
qualify would not have a material adverse effect on the business, assets,
property, financial condition or results of operations of the Company and its
Subsidiaries taken as a whole.
(g) Except for the outstanding shares of preferred stock of Consumers
Energy Company, the 8.36% Trust Originated Preferred Securities of Consumers
Power Company Financing I, the 8.20% Trust Originated Preferred Securities of
Consumers Energy Company Financing II, the 9- 1/4% Trust Originated Preferred
Securities of Consumers Energy Company Financing III, the 9% Trust Preferred
Securities of Consumers Energy Company Financing IV, the 7.75% Convertible
Quarterly Income Preferred Securities of CMS Energy Trust I, the 8.750%
Adjustable Convertible Trust Securities of CMS Energy Trust II and the 7-1/4%
Trust Preferred Securities of CMS Energy Trust III, all of the outstanding
capital stock of each of Consumers Energy Company and CMS Enterprises Company is
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 Consumers
Energy Company and CMS Enterprises Company 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.
(h) The Company has an authorized capitalization as set forth in the
Prospectus, and all of the issued shares of common stock of the Company have
been duly and validly authorized and issued and are fully paid and
non-assessable.
(i) The Shares have been duly authorized and, when the Shares are
issued and delivered pursuant to this Agreement, the Shares will be duly and
validly issued and fully paid and non-assessable; the Shares conform in all
material respects to the description thereof contained in the Registration
Statement and the Shares will conform in all material respects to the
description thereof contained in the Prospectus as amended or supplemented with
respect to the Shares. The shareholders of the Company have no preemptive rights
with respect to the Shares.
(j) There has not been any material change in the business, properties,
financial condition or results of operations of the Company or any of its
Significant Subsidiaries, from that set forth in the Registration Statement or
the Prospectus.
(k) Except as set forth in the Prospectus, there is not pending or, to
the knowledge of the Company, threatened any action, suit or proceeding to which
the Company or any of its Subsidiaries is a party, before or by any court or
governmental agency or body, that, if determined adversely, could reasonably be
expected to result in any material adverse change in the business, assets,
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property, financial condition or results of operations of the Company and its
Subsidiaries taken as a whole.
(l) There are no contracts or documents of the Company or any of its
Subsidiaries that are required to be filed as exhibits to the Registration
Statement or to any of the documents incorporated by reference therein by the
Act or the Exchange Act or by the rules and regulations of the Commission
thereunder that have not been so filed.
(m) All necessary action has been duly and validly taken by the Company
to authorize the execution, delivery and performance of this Agreement. This
Agreement has been duly and validly authorized, executed and delivered by the
Company and constitutes a legal, valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms, except as the
enforceability thereof may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting the enforcement of creditors' rights
generally and by general equitable principles.
(n) Neither the execution or delivery by the Company of, nor the
performance by the Company of its obligations under, this Agreement did or will
conflict with, or result in a breach of any terms or provisions of, or
constitute a default or require the consent of any party under the Company's
Articles of Incorporation or by-laws, any material agreement or instrument to
which it, or any of its Significant Subsidiaries, is a party, any existing
applicable law, rule or regulation or any judgment, order or decree of any
government, governmental instrumentality or court, domestic of foreign, having
jurisdiction over the Company or any of its Significant Subsidiaries or any of
their properties or assets, or did or will result in the creation or imposition
of any lien on the properties or assets of the Company or any of its Significant
Subsidiaries; no consent, approval, authorization or order of, or filing with,
any court or governmental agency or body is required for the issue and sale of
the Shares and the consummation by the Company of the transactions contemplated
by this Agreement, except such as have been obtained or may be required by state
securities or blue sky laws.
(o) Each of the Company and its Significant Subsidiaries has (i) good
and indefeasible title to all of the properties and assets described in the
Prospectus as owned by it, free and clear of all liens, charges, encumbrances or
restrictions, except such as are described in the Prospectus or are not material
to the business, assets, property, financial condition or results of operations
of the Company and its consolidated subsidiaries taken as a whole, (ii) peaceful
and undisturbed possession under all material leases to which it is party as
lessee, (iii) all governmental or regulatory licenses, certificates, permits,
authorizations, approvals, franchises or other rights necessary to engage in the
business currently conducted by it, except such as are not material to the
business, assets, property, financial condition or results of operations of the
Company and its consolidated subsidiaries taken as a whole, (iv) no reason to
believe that any governmental body or agency is considering limiting, suspending
or revoking any such license, certificate, permit, authorization, approval,
franchise or right that are material to the business, assets, property,
financial condition or results of operations of the Company and its consolidated
subsidiaries taken as a whole and (v) not received any notice of and has no
reason to believe that any governmental body or agency is considering enacting,
amending or repealing any statute, law, ordinance or regulation required to be
described in the
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Registration Statement and Prospectus that is not so described as required. To
the best of the Company's knowledge, all material leases to which the Company or
any of its Significant Subsidiaries is a party are valid and binding and no
default has occurred and is continuing thereunder, and, to the best knowledge of
the Company, no material defaults by the landlord are existing under any such
leases.
(p) The Company and its Significant Subsidiaries have not violated and
are in compliance in all material respects with all material laws, statutes,
ordinances, regulations, rules and orders of any foreign, federal, state or
local government and any other governmental department or agency, and any
judgment, decision, decree or order of any court or governmental agency,
department or authority, including, without limitation, environmental laws.
Neither the Company nor any of its Subsidiaries has received any notice to the
effect that, or otherwise been advised that, it is not in compliance with any
such statutes, regulations, rules, judgments, decrees, orders, ordinances or
other laws, and the Company is not aware of any existing circumstances which are
likely to result in material violations of any of the foregoing.
(q) Other than as set forth in the Prospectus as amended or
supplemented, the Company possesses such licenses, permits, consents, orders,
certificates or authorizations issued by the appropriate federal, state, foreign
or local regulatory agencies or bodies necessary to conduct the business now
operated by it, except for licenses, permits, consents, orders, certificates or
authorizations, the absence of which, individually or in the aggregate, would
not have a material adverse effect on the business, assets, property, financial
condition or results of operations of the Company and its Subsidiaries taken as
a whole, and the Company has not received any notice of proceedings relating to
the revocation or modification of any such licenses, permits, consents, orders,
certificates or authorizations which, singly or in the aggregate, if the subject
of an unfavorable decision, ruling or finding, would have a material adverse
effect on the business, assets, property, financial condition or results of
operations of the Company and its Subsidiaries taken as a whole.
(r) The Company (i) carries, or is covered by, insurance in such
amounts and covering such risks as is customary for companies engaged in similar
businesses in similar industries owning similar properties in the same
geographical area in which the Company operates, or (ii) in whole or in part has
established reserves of one or more insurance funds, either alone or with other
corporations or associations.
(s) To the best knowledge of the Company, except as described in the
Prospectus, there has been no storage, disposal, generation, manufacture, spill,
discharge, refinement, transportation, handling or treatment of toxic wastes,
hazardous wastes or hazardous substances by the Company (or to the knowledge of
the Company, any of its predecessors in interest) at, upon or from any of the
property now or previously owned or leased or under contract for purchase by the
Company in violation of any applicable law, ordinance, rule, regulation, order,
judgment, decree or permit or which would require remedial action under any
applicable law, ordinance, rule, regulation, order, judgment, decree or permit,
except for any violation or remedial action which would not result in, or which
would not be reasonably likely to result in, singularly or in the aggregate with
all such violations and remedial actions, any material adverse effect on the
business, assets, property,
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financial condition or results of operations of the Company and its Subsidiaries
taken as a whole; and the terms "hazardous wastes," "toxic wastes" and
"hazardous substances" shall have the meaning specified in any applicable local,
state, federal and foreign laws or regulations with respect to environmental
protection;
(t) To the best knowledge of the Company, Xxxxxx Xxxxxxxx LLP., who
have certified financial statements of the Company and its Subsidiaries included
in the Prospectus, are independent public accountants as required by the Act and
the rules and regulations of the Commission thereunder; and
(u) The Company is not and, after giving effect to the transactions
contemplated herein will not be an Investment Company as such term is defined in
the Investment Company Act of 1940.
SECTION 3. Sale and Delivery of Securities. On the basis of the
representations, warranties and agreements herein contained, but subject to the
terms and conditions herein set forth, the Company agrees to issue and sell
through the Sales Manager, as a sales agent, and the Sales Manager agrees to
sell, as sales agent for the Company, on a reasonable efforts basis, up to
2,000,000 Shares (the "Maximum Amount") but in no case less than a number of
Shares, the gross sales price of which is at least $1,500,000 (the "Minimum
Amount") on the terms set forth herein.
The Shares, up to the Maximum Amount, are to be sold on a daily basis
or otherwise as shall be agreed to by the Company and the Sales Manager. The
Company will designate and confirm in writing the maximum amount of Shares to be
sold by the Sales Manager during a specified period
as reasonably agreed to by the Sales Manager and in any event not in excess of
the amount available for issuance under the currently effective Registration
Statement. Subject to the terms and conditions hereof, the Sales Manager shall
use its reasonable efforts to sell all such designated Shares up to the Maximum
Amount. The Sales Manager shall sell such designated Shares only by means of
ordinary brokers' transactions on the New York Stock Exchange (the "NYSE") or on
any other national stock exchange on which the Company's shares are traded. The
compensation to the Sales Manager for sales of Shares shall be at a fixed
commission rate of 2% (the "Commission Rate") of the gross sales price of any
Shares sold under this Agreement. The remaining proceeds, after further
deduction for any transaction fees imposed by any governmental or
self-regulatory organization in respect of such sales, shall constitute the net
proceeds to the Company for such Shares (the "Net Proceeds").
Notwithstanding the foregoing, the Company may instruct the Sales
Manager by telephone (confirmed promptly by telecopy) not to sell Shares if such
sales cannot be effected at or above the price designated by the Company in any
such instruction; furthermore, the Company shall not authorize the issuance and
sale of, and the Sales Manager shall not be obligated to use its reasonable
efforts to sell, any Shares at a price lower than the minimum price therefor
designated from time to time by the Company's Board of Directors or special
committee thereof and notified to the Sales Manager in writing. In addition, the
Company or the Sales Manager may, upon notice to the other party hereto by
telephone (confirmed promptly by telecopy), suspend the offering of the Shares
specifying a date that such suspension shall be effected; provided, however,
that such suspension or termination shall not affect or impair the parties'
respective obligations with respect to the Shares
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sold hereunder prior to the giving of such notice. The Company may then revoke
the suspension by giving a written notice to the Sales Manager as hereinafter
specified (an "Activation Notice").
The Sales Manager may, upon notice to the Company by telephone
(confirmed promptly by telecopy), suspend the offering of Shares; provided,
however, that such suspension or termination shall not affect or impair the
parties' respective obligations with respect to Shares sold hereunder prior to
the giving of such notice.
The Sales Manager shall provide written confirmation to the Company
following the close of trading on the NYSE each day in which Shares are sold
under this Agreement setting forth the number of Shares sold on such day, the
Net Proceeds to the Company, the compensation payable by the Company to the
Sales Manager with respect to such sales, the total number of Shares sold
pursuant to this Agreement and the aggregate gross sales price of Shares sold
pursuant to this Agreement.
Settlement for sales of Shares will occur on the third business day
following the date on which such sales are made (each a "Closing Date"). The
amount of proceeds for such sales to be delivered to the Company against the
receipt of the Shares sold shall be equal to the aggregate sales prices at which
such Shares were sold, net of the Sales Manager's compensation for such sales
and after deduction for any transaction fees imposed by any governmental or
self-regulatory organization in respect of such sales. Settlement for all Shares
shall be effected by free delivery of Shares to the Sales Manager's account at
The Depository Trust Corporation in return for payments in same day funds
delivered to the account designated by the Company. If the Company shall default
on its obligation to deliver Shares on any Closing Date, the Company shall (i)
hold the Sales Manager harmless against any loss, claim or damage arising from
or as a result of such default by the Company and (ii) pay the Sales Manager any
commission to which it would otherwise be entitled absent such default. If the
Sales Manager breaches this Agreement by failing to deliver proceeds on any
Closing Date for Shares delivered by the Company, the Sales Manager will pay the
Company interest based on the effective overnight Federal Funds rate.
On each Closing Date, the Company shall be deemed to have affirmed each
representation, warranty, covenant and other agreement contained in this
Agreement, and on the first and third Monday of each month, to the extent a sale
under this Agreement occurred during the immediately preceding 21 day period
(each an "Affirmation Date"), the Company shall affirm in writing each
representation, warranty, covenant and other agreement contained in this
Agreement, unless no sale under this Agreement was made since the last
Affirmation Date. Any obligation of the Sales Manager to use its reasonable
efforts to sell the Shares shall be subject to the continuing accuracy of the
representations and warranties of the Company herein, to the performance by the
Company of its obligations hereunder and to the continuing satisfaction of the
additional conditions specified in Section 5 of this Agreement.
SECTION 4. Covenants of the Company. The Company covenants and agrees
with the Sales Manager that:
(a) During the period in which a prospectus relating to the Shares is
required to be
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delivered under the Act, the Company will notify the Sales Manager promptly of
the time when any subsequent amendment to the Registration Statement has become
effective or any subsequent supplement to the Prospectus has been filed and of
any request by the Commission for any amendment or supplement to the
Registration Statement or Prospectus or for additional information; it will
prepare and file with the Commission, promptly upon the Sales Manager's
reasonable request, any amendments or supplements to the Registration Statement
or Prospectus that, in the Sales Manager's opinion, may be necessary or
advisable in connection with the distribution of the Shares by the Sales
Manager; the Company will not file any amendment or supplement to the
Registration Statement or Prospectus (other than any prospectus supplement
relating to the offering of other securities registered under the Registration
Statement) unless a copy thereof has been submitted to the Sales Manager a
reasonable period of time before the filing and the Sales Manager has not
reasonably objected thereto; and it will furnish to the Sales Manager at the
time of filing thereof a copy of any document that upon filing is deemed to be
incorporated by reference in the Registration Statement or Prospectus; and the
Company will cause each amendment or supplement to the Prospectus to be filed
with the Commission as required pursuant to the terms of this Agreement or, in
the case of any document to be incorporated therein by reference, to be filed
with the Commission as required pursuant to the Exchange Act, within the time
period prescribed.
(b) The Company will advise the Sales Manager, promptly after it shall
receive notice or obtain knowledge thereof, of the issuance by the Commission of
any stop order suspending the effectiveness of the Registration Statement, of
the suspension of the qualification of the Shares for offering or sale in any
jurisdiction, or of the initiation or threatening of any proceeding for any such
purpose; and it will promptly use its reasonable best efforts to prevent the
issuance of any stop order or to obtain its withdrawal if such a stop order
should be issued.
(c) Within the time during which a prospectus relating to the Shares is
required to be delivered under the Act, the Company will comply as far as it is
able with all requirements imposed upon it by the Act and by the Rules and
Regulations, as from time to time in force, so far as necessary to permit the
continuance of sales of or dealings in the Shares as contemplated by the
provisions hereof and the Prospectus and will file promptly all reports and any
definitive proxy or information statements required to be filed by the Company
with the Commission pursuant to Sections 13(a), 13(c), 14 or 15(d) of the
Exchange Act for so long as the delivery of a prospectus is required in
connection with the offering or sale of such Shares. If during such period any
event occurs as a result of which the Prospectus as then amended or supplemented
would include an untrue statement of a material fact or omit to state a material
fact necessary to make the statements therein, in the light of the circumstances
then existing, not misleading, or if during such period it is necessary to amend
or supplement the Registration Statement or Prospectus to comply with the Act,
the Company will promptly notify the Sales Manager to suspend the offering of
Shares during such period (and, if so notified, the Sales Manager will cease
such offering as soon as practicable, but in any event, no later than one
business day later) and the Company will amend or supplement the Registration
Statement or Prospectus (at the expense of the Company, unless the misstatements
or omissions in question were made solely in reliance on written information
relating to the Sales Manager furnished to the Company by the Sales Manager
expressly for use in the Registration Statement or Prospectus in which case such
amendment or supplement shall be at the expense of the Sales Manager) so as to
correct such statement or omission or effect such compliance.
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(d) The Company will use its best efforts to qualify the Shares for
sale under the securities laws of such jurisdictions as the Sales Manager
designates and to continue such qualifications in effect so long as required for
the distribution of the Shares, except that the Company shall not be required in
connection therewith to qualify as a foreign corporation or to execute a general
consent to service of process in any jurisdiction or to file annual reports or
to comply with any other requirements reasonably deemed by the Company to be
unduly burdensome.
(e) The Company will furnish to the Sales Manager and its counsel (at
the expense of the Company) copies of the Registration Statement, the Prospectus
(including all documents incorporated by reference therein) and all amendments
and supplements to the Registration Statement or the Prospectus that are filed
with the Commission during the period in which a prospectus relating to the
Shares is required to be delivered under the Act (including all documents filed
with the Commission during such period that are deemed to be incorporated by
reference therein), in each case as soon as available and in such quantities as
the Sales Manager may from time to time reasonably request and will also furnish
copies of the Prospectus to the NYSE in accordance with Rule 153 of the Rules
and Regulations.
(f) The Company will make generally available to its security holders
as soon as practicable, but in any event not later than 15 months after the end
of the Company's current fiscal quarter, an "earnings statement" (which need not
be audited) covering a 12-month period that satisfies the provisions of Section
11(a) of the Act and Rule 158 of the Rules and Regulations.
(g) Within six (6) months of the date hereof, the Company will sell
through the Sales Manager pursuant to this Agreement at least the Minimum
Amount.
(h) The Company, whether or not the transactions contemplated hereunder
are consummated or this Agreement is terminated, will pay all expenses incident
to the performance of its obligations hereunder, including, but not limited to,
expenses relating to (i) the printing and filing of the Registration Statement
as originally filed and of each amendment thereto, (ii) the preparation,
issuance and delivery of the Shares, (iii) the reasonable fees and disbursements
of the Company's counsel and accountants, (iv) the qualification of the Shares
under securities laws in accordance with the provisions of Section 4(d) of this
Agreement, including filing fees and any reasonable fees or disbursements of
counsel for the Sales Manager in connection therewith, (v) the printing and
delivery to the Sales Manager of copies of the Prospectus and any amendments or
supplements thereto, and of this Agreement, (vi) the fees and expenses incurred
in connection with the listing of the Shares on the NYSE, and (vii) filing fees
of the Commission and filing fees incident to any required review by the
National Association of Securities Dealers, Inc.; provided, however, that the
Sales Manager shall pay the fees and disbursements of the Sales Manager's
counsel and further, provided, that if the Company shall not sell through the
Sales Manager pursuant to this Agreement within six (6) months from the date
hereof at least the Minimum Amount, then in addition to any fees that may be
payable to the Sales Manager under this Agreement, the Company shall pay the
Sales Manager an amount equal to the product of the Commission Rate and the
difference between the Minimum Amount and the actual gross proceeds.
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(i) The Company will apply the net proceeds from the sale of the Shares
as set forth in the Prospectus.
(j) The Company will not, directly or indirectly, offer or sell any
shares of Common Stock (other than the Shares offered pursuant to the provisions
of this Agreement and other than shares of Common Stock sold pursuant to other
arrangements substantially similar to this Agreement) or securities convertible
into or exchangeable for, or any rights to purchase or acquire, Common Stock
during the period from the date of this Agreement through the final Closing Date
for the sale of Shares hereunder without suspending activity under this program
for such period of time as may reasonably be determined by the Company;
provided, however that no such notice and suspension shall be required in
connection with the Company's issuance or sale of (i) shares of the Company's
Common Stock under its Stock Purchase Plan, Performance Incentive Stock Plan,
Employee Stock Ownership Plan and Employee Saving and Incentive Plan or (ii)
Common Stock issuable upon conversion of securities or the exercise of warrants,
purchase contracts, options or other rights in effect or outstanding on the date
hereof.
(k) The Company will, at any time during the term of this Agreement, as
supplemented from time to time, advise the Sales Manager immediately after it
shall have received notice or obtained knowledge thereof, of any information or
fact that would materially alter or affect any opinion, certificate, letter and
other document provided to the Sales Manager pursuant to Section 5 herein or at
any Closing Date.
(l) Each time that (i) the Registration Statement or the Prospectus
shall be amended or supplemented (other than a supplement filed pursuant to Rule
424(b) under the Act that relates solely to Shares sold pursuant to this
Agreement) or (ii) there is filed with the Commission any document incorporated
by reference into the Prospectus (other than a Current Report on Form 8-K,
unless the Sales Manager shall otherwise reasonably request), the Company shall
furnish or cause to be furnished to the Sales Manager forthwith a certificate
dated the date of filing with the Commission of such amendment, supplement or
other document, the date of effectiveness of amendment, as the case may be, in
form satisfactory to the Sales Manager to the effect that the statements
contained in the certificate referred to in Section 5(f) hereof which were last
furnished to the Sales Manager are true and correct at the time of such
amendment, supplement or filing, as the case may be, as though made at and as of
such time (except that such statements shall be deemed to relate to the
Registration Statement and the Prospectus as amended and supplemented to such
time) or, in lieu of such certificate, a certificate of the same tenor as the
certificate referred to in said Section 5(f), modified as necessary to relate to
the Registration Statement and the Prospectus as amended and supplemented to the
time of delivery of such certificate.
(m) Each time that (i) the Registration Statement or the Prospectus is
amended or supplemented (other than a supplement filed pursuant to Rule 424(b)
under the Act that relates solely to Shares sold pursuant to this Agreement) or
(ii) there is filed with the Commission any document incorporated by reference
into the Prospectus (other than a Current Report on Form 8-K, unless the Sales
Manager shall otherwise reasonably request), the Company shall furnish or cause
to be furnished forthwith to the Sales Manager and to counsel to the Sales
Manager a written opinion of Xxxxxx X. Xxx Xxxxxx, Assistance General Counsel of
the Company ("Company Counsel"), or other
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counsel satisfactory to the Sales Manager, dated the date of filing with the
Commission of such amendment, supplement or other document and the date of
effectiveness of such amendment, as the case may be, in form and substance
satisfactory to the Sales Manager, of the same tenor as the opinion referred to
in Section 5(d) hereof, but modified as necessary to relate to the Registration
Statement and the Prospectus as amended and supplemented to the time of delivery
of such opinion.
(n) Each time that the Registration Statement or the Prospectus shall
be amended or supplemented to include additional amended financial information
or there is filed with the Commission any document incorporated by reference
into the Prospectus which contains additional amended financial information, the
Company shall cause Xxxxxx Xxxxxxxx LLP., or other independent accountants
satisfactory to the Sales Manager, forthwith to furnish the Sales Manager a
letter, dated the date of effectiveness of such amendment, or the date of filing
of such supplement or other document with the Commission, as the case may be, in
form satisfactory to the Sales Manager, of the same tenor as the letter referred
to in Section 5(e) hereof but modified to relate to the Registration Statement
and the Prospectus, as amended and supplemented to the date of such letter.
(o) The Company will not, directly or indirectly, (i) take any action
designed to cause or result in, or that constitutes or might reasonably be
expected to constitute, the stabilization or manipulation of the price of any
security of the Company to facilitate the sale or resale of the Shares or (ii)
sell, bid for, purchase, or pay anyone any compensation for soliciting purchases
of the Shares or pay or agree to pay any person any compensation for soliciting
another to purchase any of the Shares (other than the Shares offered pursuant to
the provisions of this Agreement and other than shares of Common Stock sold
pursuant to other arrangements substantially similar to this Agreement)
SECTION 5. Conditions of Sales Manager's Obligations. The obligations
of the Sales Manager to sell the Shares as provided herein shall be subject to
the accuracy, as of the date hereof and as of each Closing Date, of the
representations and warranties of the Company herein, to the performance by the
Company of its covenants and other obligations hereunder and to the following
additional conditions:
(a) The Registration Statement shall have become effective and, as of
the date hereof and as of each Closing Date, no stop order suspending the
effectiveness of the Registration Statement shall have been issued and no
proceeding for that purpose shall have been instituted or, to the knowledge of
the Company, threatened by the Commission, and any request of the Commission for
additional information (to be included in the Registration Statement or the
Prospectus or otherwise) shall have been complied with to the Sales Manager's
reasonable satisfaction.
(b) The Sales Manager shall not have advised the Company that the
Registration Statement or Prospectus, or any amendment or supplement thereto,
contains an untrue statement of fact that in the Sales Manager's opinion is
material, or omits to state a fact that in the Sales Manager's reasonable
opinion is material and is required to be stated therein or is necessary to make
the statements therein not misleading.
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(c) Except as contemplated in the Prospectus, subsequent to the
respective dates as of which information is given in the Registration Statement
and the Prospectus, there shall not have been any material change, on a
consolidated basis, in the capital stock of the Company and its Subsidiaries, or
any material adverse change, or any development that may reasonably be expected
to cause a material adverse change, in the business, assets, property, financial
condition or results of operations of the Company and its Subsidiaries taken as
a whole, or a downgrading in or withdrawal of the rating assigned to any of the
Company's securities by any rating organization, and no rating organization
shall have publicly announced that it has under surveillance or review, with
possible negative implications, its rating of any of the Company's securities.
(d) The Sales Manager shall have received on the date hereof and at
every other date specified in Section 4(1) hereof, opinions of Company Counsel,
dated as of such dates, respectively, substantially to the effect that:
(i) The Company is a duly organized and validly existing
corporation in good standing under the laws of the State of Michigan.
(ii) The Shares have been duly authorized by all necessary
corporate action on the part of the Company and, when issued and
delivered to and paid for by the purchasers thereof in accordance with
the terms of the Agreement, will be validly issued, fully paid and
non-assessable.
(iii) The shares of Common Stock of the Company outstanding
prior to the issuance of the Shares have been duly authorized and are
validly issued, fully paid and non-assessable.
(iv) All legally required corporate proceedings in connection
with the authorization, issuance and validity of the Shares and the
sale of the Shares by the Company in accordance with the Agreement have
been taken; and, except such as have been obtained under the Act, no
further approval, authorization, consent or other order of any
governmental regulatory body is required with respect to the issuance
and sale of the Shares (other than in connection with or in compliance
with the provisions of the Shares or Blue Sky laws of any state, as to
which I express no opinion).
(v) To the best of such counsel's knowledge, after due
inquiries, there are no legal or governmental proceedings required to
be described in the Prospectus that are not described as required, nor
of any contracts or documents of a character required to be described
in the Registration Statement or Prospectus or to be filed as exhibits
to the Registration Statement that are not described or filed as
required.
(vi) The statements made in the Prospectus under the caption
"Description of Securities-Capital Stock" and in the Prospectus
Supplement under the caption "Supplemental Description of Capital
Stock" accurately summarize the provisions of the Company's Restated
Articles of Incorporation and the Securities conform as to legal
matters
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to the description thereof and to the statements in regard thereto
contained in the Registration Statement and the Prospectus.
(vii) The Registration Statement has become effective under
the Act. We were orally advised by the Commission that no stop order
suspending the effectiveness of the Registration Statement has been
issued and no proceedings for that purpose have been instituted or are
pending or threatened under the Act.
(viii) The Registration Statement, as of its effective date,
and the Prospectus, as of the date thereof (except in each case for (i)
the operating statistics, financial statements and schedules contained
or incorporated by reference therein (including the notes thereto, and
auditors' reports thereon), (ii) the other financial or statistical
information contained or incorporated by reference therein and (iii)
the exhibits thereto, as to all of which I express no opinion),
complied as to form in all material respects with the requirements of
Form S-3 under the Act and the applicable rules and regulations of the
Commission thereunder, and each document incorporated therein as
originally filed pursuant to the Exchange Act (except for (i) the
operating statistics, financial statements and schedules contained or
incorporated by reference therein (including the notes thereto, and the
auditors' reports thereon), (ii) the other financial or statistical
information contained or incorporated by reference therein and (iii)
the exhibits thereto, as to which I express no opinion) complied as to
form when so filed in all material respects with the Exchange Act
and the applicable rules and regulations of the Commission thereunder.
(ix) Neither the execution or delivery by the Company of, nor
the performance by the Company of its obligations under this Agreement
did or will conflict with, result in a breach of any terms or
provisions of, or constitute a default or require the consent of any
party under the Company's Articles of Incorporation or by-laws, any
material agreement or instrument to which it, or any of its Significant
Subsidiaries, is a party, any existing applicable law, rule or
regulation or any judgment, order or decree of any government,
governmental instrumentality or court, domestic of foreign, having
jurisdiction over the Company or any of its Significant Subsidiaries or
any of their properties or assets, or did or will result in the
creation or imposition of any lien on the properties or assets of the
Company or any of its Significant Subsidiaries.
(x) The Company timely filed with the Commission the
appropriate exemption statement pursuant to Rule 2 under the Public
Utility Holding Company Act of 1935, as amended (the 1935 Act ), and
accordingly, is exempt from the provisions of the 1935 Act except for
Section 9(a)(2) thereof, subject to the right of the Commission acting
pursuant to Rule 6 under the 1935 Act to revoke the exemption by
notification to the Company. To my knowledge, the Company has received
no such notification from the Commission.
(xi) The Company is not and, after giving effect to the
transactions contemplated herein will not be an Investment Company as
such term is defined in the Investment Company Act of 1940.
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In addition, such counsel shall state that, after due inquiries and
reasonable investigation with Company's officers and representatives of the
independent public accountant, such counsel has no reason to believe that either
the Registration Statement (including each Post-Effective Amendment thereto), at
the time it became effective, contained an untrue statement of a material fact
or omitted to state a material fact required to be stated therein or necessary
to make the statements therein not misleading or that the Prospectus and any
amendments or supplements thereto, on the date of such opinion and at each
Closing Date on or prior to the date of the opinion, included an untrue
statement of a material fact or omitted to state a material fact necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading; it being understood that such counsel need express no
opinion as to the financial statements or other financial data included in any
of the documents mentioned in this paragraph.
(e) On the date hereof and at such other dates specified in Section
4(m) hereof, the Sales Manager shall have received a letter from Xxxxxx Xxxxxxxx
LLP, independent public accountants for the Company, or other independent
accountants satisfactory to the Sales Manager, dated the date of delivery
thereof, substantially in the form attached hereto as Annex I and otherwise in
form and substance satisfactory to Sales Manager.
(f) The Sales Manager shall have received from the Company a
certificate, or certificates, signed by the Chairman of the Board, the Chief
Financial Officer or the Chief Accounting Officer, dated as of the date hereof
and dated as of each Affirmation Date contemplated by this Agreement, to the
effect that, to the best of their knowledge based upon reasonable investigation:
(i) the Sales Agreement is in the form presented to and
approved by the Special Committee of the Board of Directors of the
Company;
(ii) there has been no material adverse change in the
business, properties or financial condition of the Company and its
Subsidiaries, taken as a whole, from that set forth in the Registration
Statement or Prospectus (other than changes referred to in or
contemplated by the Registration Statement or Prospectus);
(iii) the representations and warranties of the Company in
such Sales Agreement are true and correct in all material respects on
and as of the date hereof with the same effect as if made on and as of
the date hereof;
(iv) no stop order suspending the effectiveness of the
Registration Statement is in effect, and no proceedings for such
purpose have been are pending before or threatened by the Commission;
and
(v) the Company has performed such of its obligations under
such Sales Agreement as are to be performed at or before the date
hereof by the terms of such Sales Agreement.
(g) That prior to the date hereof and prior to each Closing Date, the
Shares shall have
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been duly listed, subject to notice of issuance, on the New York Stock Exchange.
(h) On the date hereof and on each Affirmation Date, the Company shall
have furnished to the Sales Manager such appropriate further information,
certificates and documents as the Sales Manager may reasonably request.
All such opinions, certificates, letters and other documents will be in
compliance with the provisions hereof only if they are satisfactory in form and
substance to the Sales Manager and its counsel. The Company will furnish the
Sales Manager with such conformed copies of such opinions, certificates, letters
and other documents as the Sales Manager shall reasonably request.
SECTION 6. Indemnification.
(a) The Company agrees to indemnify and hold harmless the Sales
Manager, the directors, officers, employees and agents of the Sales Manager and
each person, if any, who controls the Sales Manager within the meaning of
Section 15 of the Act or Section 20 of the Exchange 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 the Act or otherwise, and to reimburse
the Sales Manager 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
6(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 Registration Statement, any preliminary prospectus as of its
issue date, the Prospectus, or, if the Prospectus shall be amended or
supplemented, in the Prospectus as so amended or supplemented (if such
Prospectus or such Prospectus as amended or supplemented is used after the
period of time referred to in Section 4(a) hereof, it shall contain or be used
with such amendments or supplements as the Company deems necessary to comply
with Section 10(a) of the Act), 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 such preliminary prospectus, Registration
Statement or Prospectus, or in the Prospectus as so amended or supplemented, in
reliance upon and in conformity with information furnished in writing to the
Company by, or through the Sales Manager expressly for use therein.
The Company's indemnity agreement contained in this Section
6(a), and the covenants, representations and warranties of the Company 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 Shares hereunder, and the indemnity agreement contained
in this Section 6 shall survive any termination of this Agreement. The
liabilities of the Company in this Section 6(a) are in addition to any other
liabilities of the Company under this Agreement or otherwise.
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(b) The Sales Manager agrees, to the extent permitted by law, to
indemnify, hold harmless and reimburse the Company, its directors and such of
its officers as shall have signed the Registration Statement and each person, if
any, who controls the Company 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 6(a) hereof, but
only with respect to alleged untrue statements or omissions made in the
Registration Statement or in the Prospectus, as amended or supplemented (if
applicable), in reliance upon and in conformity with information furnished in
writing to the Company by the Sales Manager expressly for use therein.
The indemnity agreement on the part of the Sales Manager
contained in this Section 6(b) 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 Shares hereunder, and the
indemnity agreement contained in this Section 6(b) shall survive any termination
of this Agreement. The liabilities of the Sales Manager in Section 6(b) are in
addition to any other liabilities of the Sales Manager 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 6(a) or 6(b), such person (the
"Indemnified Person") shall notify the person against whom such indemnity may be
sought (the "Indemnifying 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 6(a) or 6(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, reasonably
acceptable to the Indemnified Person, and the payment of all expenses, with such
counsel being designated, subject to the immediately succeeding sentence, in
writing by the Sales Manager in the case of parties indemnified pursuant to
Section 6(b) and by the Company in the case of parties indemnified pursuant to
Section 6(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
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Persons, or any of them, are found to be solely liable, such Indemnified Persons
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
Sales Manager and the Company agree that the Indemnifying Person's obligations
to pay such fees and expenses shall be conditioned upon the following:
(1) in case separate counsel is proposed to be
retained by the Indemnified Persons pursuant to clause (ii)
of the preceding paragraph, the Indemnified Persons shall in
good faith fully consult with the Indemnifying Person in
advance as to the selection of such counsel;
(2) 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
(3) the Company and the Sales Manager 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 6, 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
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liability with respect to claims which are the subject matter of such
litigation, proceeding or claim.
SECTION 7. Contribution: If the indemnification provided for in Section
6 above is unavailable to or insufficient to hold harmless an Indemnified Person
under such Section 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 Section 6
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 Shares. 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 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 Sales Manager 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 underwriting discounts
and commission received by the Sales Manager, bear to the aggregate public
offering price of the Shares. 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
Underwriters 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 Sales Manager agree that it would not be just and equitable
if contribution pursuant to this Section 7 were determined by pro rata
allocation (even if the Underwriters 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 7. 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 7 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 Section 6 have been complied with (in all
material respects) in respect of any separate counsel for such Indemnified
Person. Notwithstanding the provisions of this Section 7, the Sales Manager
shall not be required to contribute any amount greater than the excess of (i)
the total price at which the Shares sold by it and distributed to the public
were offered to the public over (ii) the amount of any damages which the Sales
Manager 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.
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The agreement with respect to contribution contained in
Section 7 hereof shall remain in full force and effect regardless of any
investigation made by or on behalf of the Company or any Underwriter, and shall
survive delivery of and payment for the Shares hereunder and any termination of
this Agreement.
SECTION 8. Representations and Agreements to Survive Delivery. All
representations, warranties and agreements of the Company herein or in
certificates delivered pursuant hereto, and the agreements of the Sales Manager
contained in Section 6 hereof, shall remain operative and in full force and
effect regardless of any investigation made by or on behalf of the Sales Manager
or any controlling persons, or the Company (or any of their officers, directors
or controlling persons), and shall survive delivery of and payment for the
Shares.
SECTION 9. Termination.
(a) Each party shall have the right, by giving notice as hereinafter
specified, to terminate this Agreement in its sole discretion at any time. Any
such termination shall be without liability of any party to any other party
except that the provisions of Section 4(h), Section 6, Section 7 and Section 8
hereof shall remain in full force and effect notwithstanding such termination.
(b) This Agreement shall remain in full force and effect unless
terminated pursuant to Sections 9(a) above or otherwise by mutual agreement of
the parties; provided that any such termination by mutual agreement shall in all
cases be deemed to provide that Section 4(h), Section 6, Section 7 and Section 8
shall remain in full force and effect.
(c) Any termination of this Agreement shall be effective on the date
specified in such notice of termination; provided that such termination shall
not be effective until the close of business on the date of receipt of such
notice by the Sales Manager or the Company, as the case may be.
If such termination shall occur prior to the Closing Date for any sale of
Shares, such Shares shall settle in accordance with the provisions of the second
to last paragraph of Section 3 hereof.
SECTION 10. Notices. All notices or communications hereunder, other
than notices pursuant to Section 3 of this Agreement, shall be in writing and if
sent to the Sales Manager shall be mailed, delivered, telexed or telecopied and
confirmed, in writing, to the Sales Manager at RCG Equity Finance, 000 Xxxxx
Xxxxxx, 00xx Xxxxx, Xxx Xxxx, XX 00000, Attn: Corporate Finance, fax number
000-000-0000, or if sent to the Company, shall be mailed, delivered, telexed or
telecopied and confirmed, in writing, to the Company at 000 Xxxx Xxxxxx Xxxxx,
Xxxxxxxx Xxxxx Xxxxx, Xxxxx 0000, Xxxxxxxx, Xxxxxxxx 00000, telecopy no. (313)
436-9200, attention: Xx. Xxxxx Xxxxxxxxxxx. Each party to this Agreement may
change such address for notices by sending to the parties to this Agreement
written notice of a new address for such purpose.
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SECTION 11. Parties. This Agreement shall inure to the benefit of and
be binding upon the Company and the Sales Manager and their respective
successors and the controlling persons, officers and directors referred to in
Section 6 hereof, and no other person will have any right or obligation
hereunder.
SECTION 12. Adjustments for Stock Splits. The parties acknowledge and
agree that all share related numbers contained in this Agreement (including,
without limitation, the Maximum Amount) shall be adjusted to take into account
any stock split effected with respect to the Shares.
SECTION 13. Entire Agreement. This Agreement constitutes the entire
agreement and supersedes all other prior and contemporaneous agreements and
undertakings, both written and oral, among the parties hereto with regard to the
subject matter hereof.
SECTION 14. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK WITHOUT
REGARD TO THE PRINCIPLES OF CONFLICTS OF LAWS.
SECTION 15. Waiver of Jury Trial. The Company and the Sales Manager
each hereby irrevocably waive any right they may have to a trial by jury in
respect of any claim based upon or arising out of this agreement or any
transaction contemplated hereby.
SECTION 16. Counterparts. This Agreement may be executed in two or more
counter parts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
If the foregoing correctly sets forth the understanding between the
Company and the Sales Manager, please so indicate in the space provided below
for that purpose, whereupon this letter shall constitute a binding agreement
between the Company and the Sales Manager. Alternatively, the execution of this
Agreement by the Company and its acceptance by or on behalf of the Sales Manager
may be evidenced by an exchange of telegraphic or other written communications.
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CMS ENERGY CORPORATION.
By:
----------------------------------------
Name:
Title:
RCG Equity Finance, a division of Ramius Securities LLC
By:
----------------------------------
Name:
Title:
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ANNEX I
[Form of Letter from Accountants]
23
