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EXHIBIT 10.2
, dated as of June 23, 1998 (the
""), by and between Michigan Consolidated Gas
Company, a Michigan corporation (the "Company"), and Xxxxxxx Xxxxx & Co./
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated ("Xxxxxxx Xxxxx").
WHEREAS, the Company has issued $75,000,000 aggregate
principal amount of Extendable MandatOry Par Put Remarketed Securities(sm)
("MOPPRS(sm)") due June 30, 2038 (the "Senior Notes"), pursuant to an Indenture
dated as of June 1, 1998, as supplemented and amended (the "Indenture"), by and
between the Company and Citibank, N.A., as trustee (the "Trustee"), which Senior
Notes have been secured by the issuance and delivery to the Trustee, on behalf
of the holders of the Senior Notes, of the Company's First Mortgage Bonds,
Collateral Series A (the "Collateral Bonds"), issued under and ratably secured
by the Indenture of Mortgage and Deed of Trust dated as of March 1, 1944 (the
"Original Secured Indenture"), as supplemented and amended by thirty-five
indentures supplemental thereto, including specifically the Twenty-Ninth
Supplemental Indenture, and the Thirty-Fifth Supplemental Indenture creating the
series in which the Collateral Bonds were issued (the "Thirty-Fifth Supplemental
Indenture") (the Original Secured Indenture and all supplemental indentures
thereto being referred to collectively herein as the "Secured Indenture"), in a
principal amount equal to that of and having other terms that mirror those of
the Senior Notes; and
WHEREAS, the Senior Notes are being sold initially pursuant to
a purchase agreement dated June 18, 1998 (the "Purchase Agreement") between the
Company and Xxxxxxx Xxxxx;
WHEREAS, the Company has requested Xxxxxxx Xxxxx to act as
Reset Remarketing Agent, as defined in Section 2(a) hereof, and as Rate Agent,
as defined in Section 2 hereof, in connection with the Senior Notes, and as such
to perform the services described herein; and
WHEREAS, Xxxxxxx Xxxxx is prepared to act as Reset Remarketing
Agent and Rate Agent with respect to the remarketing of the Senior Notes
pursuant to the terms of, but subject to the conditions set forth in, this
Agreement.
NOW, THEREFORE, for and in consideration of the covenants
herein made, and subject to conditions herein set forth, the parties hereto
agree as follows:
Section 1. Definitions. Capitalized terms used and not defined
in this Agreement shall have the respective meanings assigned to them in the
Indenture (including the form of the Senior Notes).
Section 2. Appointment and Obligations of Xxxxxxx Xxxxx. (a)
The Company hereby appoints Xxxxxxx Xxxxx, and Xxxxxxx Xxxxx hereby accepts such
appointment, (i) as the Rate Agent for the Senior Notes, to determine (A) LIBOR
and the interest rate on the Senior Notes for
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any Interest Period and/or (B) the yield to maturity on the applicable United
States Treasury security that is used in connection with the determination of
the applicable Fixed Rate, and the ensuing applicable Fixed Rate; and (ii) as
the exclusive remarketing agent (the"Reset Remarketing Agent") for the purpose
of (x) recommending to the Company the Spread for each Subsequent Spread Period
that, in the opinion of the Reset Remarketing Agent, will enable the Reset
Remarketing Agent to remarket, for delivery on any Reset Tender Date (as defined
below), all tendered Senior Notes with respect to which the Reset Remarketing
Agent receives a Reset Tender Notice (as defined below) at 100% of the principal
amount thereof, (y) if the Company and the Reset Remarketing Agent agree on the
Spread referred to in (x) above, entering into a
supplement (each, a " Supplement") with the Company,
substantially in the form attached hereto as Exhibit A, pursuant to which the
Reset Remarketing Agent will agree to purchase the Senior Notes tendered by the
beneficial owners thereof (the "Beneficial Owners") and , on a best-efforts
basis, to remarket such Senior Notes (each such purchase and remarketing being
hereinafter referred to as a "Remarketing"), and (z) performing such other
duties as are assigned to the Reset Remarketing Agent in the Senior Notes and/or
the Indenture and/or the applicable Supplement. For
purposes of this Agreement, the term "Reset Tender Date" with respect to any
Subsequent Spread Period shall mean the Business Day immediately following any
Spread Determination Date.
(b) Notwithstanding the foregoing, the obligations of the
parties hereunder, except for the obligation of the Company set forth in
paragraph (c) below, shall not commence until the earlier to occur (the
"Effective Date") of: (i) the failure of Xxxxxxx Xxxxx & Co./Xxxxxxx Lynch,
Pierce, Xxxxxx & Xxxxx Incorporated (the "Mandatory Tender Remarketing Agent")
by the eleventh Business Day prior to June 30, 2008 (the "First Remarketing
Date") to notify the Company and the Reset Remarketing Agent of its election to
exercise its option (the "Remarketing Right") to remarket the Senior Notes
during the period from the First Remarketing Date until June 30, 2018 (the
"Second Remarketing Date") pursuant to that certain Mandatory Tender Remarketing
Agreement dated as of the date hereof between the Company and the Mandatory
Tender Remarketing Agent as in effect on the date hereof; and (ii) the Second
Remarketing Date.
(c) Thirty calendar days prior to the First Remarketing Date,
the Company shall request that DTC provide preliminary notification to its
Participants that, on the date that is ten Business Days prior to the First
Remarketing Date, either the Remarketing Right will be exercised and the Senior
Notes will be subject to mandatory tender or the Senior Notes will be in Reset
Mode and a Duration/Interest Mode Determination Date will have occurred.
(d) If the Mandatory Tender Remarketing Agent does not provide
notification of its intention to exercise the Remarketing Right as provided
above, then on the date that is ten Business Days prior to the First Remarketing
Date, the Company shall request that DTC notify its Participants of the
occurrence of a Duration/Interest Mode Determination Date and of the procedures
that must be followed if any Beneficial Owner of a Senior Note wishes to tender
such Senior Note for remarketing.
(e) With respect to all Subsequent Spread Periods established
after the First Remarketing Date, the Company shall request not later than five
nor more than ten calendar days prior to any Duration/Interest Mode
Determination Date, that DTC notify its Participants of such
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Duration/Interest Mode Determination Date and of the procedures that must be
followed if any Beneficial Owner of a Senior Note wishes to tender such Senior
Note for remarketing.
(f) Unless the Company shall have notified the Reset
Remarketing Agent of its election to redeem the Senior Notes in full, on or
before the tenth Business Day prior to the commencement (the "Commencement
Date") of each Subsequent Spread Period (the "Duration/Interest Mode
Determination Date"), the Reset Remarketing Agent shall make a recommendation to
the Company with respect to the duration, redemption date(s), redemption type
(i.e., par, premium, or make-whole, including in the case of make-whole,
Reinvestment Spread), redemption prices (if applicable), Commencement Date,
Interest Payment Dates and Interest Rate Mode (i.e., Fixed Rate Interest Mode or
Floating Rate Interest Mode) and any other relevant terms (other than the
Spread) for each Subsequent Spread Period and all of such terms shall be agreed
to by the Company and the Reset Remarketing Agents by 3:00 p.m., New York City
time, on such Duration/Interest Mode Determination Date.
(g) On or before the fifth Business Day prior to the
Commencement Date of each Subsequent Spread Period (the "Spread Determination
Date"), the Reset Remarketing Agent shall make a recommendation to the Company
with respect to the Spread to apply during such Subsequent Spread Period, and
the Spread shall be agreed to by the Company and the Reset Remarketing Agent by
1:00 p.m., New York City time, on such Spread Determination Date, irrespective
of whether the Senior Notes shall be in the Floating Rate Interest Mode or the
Fixed Rate Interest Mode.
(h) On the third Business Day prior to the Commencement Date
of each Subsequent Spread Period for which Senior Notes will be in the Fixed
Rate Interest Mode (a "Fixed Rate Determination Date"), the Rate Agent shall
notify the Reset Remarketing Agent of the applicable U.S. Treasury Security to
be used for the determination of the Fixed Rate to apply to the Senior Notes for
such Subsequent Spread Period, and the Remarketing Agent and the Company shall
agree on such Fixed Rate by 1:00 p.m., New York City time, on such Fixed Rate
Determination Date.
(i) On the second Business Day prior to the Commencement Date
of each Subsequent Spread Period for which Senior Notes will be in the Floating
Rate Interest Mode, and on the second Business Day prior to each Interest Reset
Date during such Subsequent Spread Period (each, a "LIBOR Determination Date"),
the Rate Agent shall notify the Reset Remarketing Agent of (i) LIBOR and (ii)
the applicable interest rate for the initial Interest Period in such Subsequent
Spread Period.
(j) In the event that the Company and the Reset Remarketing
Agent do not agree on the Spread for any Subsequent Spread Period, then the
Company is required unconditionally to repurchase and retire all of the Notes on
the relevant Reset Tender Date at a price equal to 100% of the principal amount
thereof, together with accrued interest to the Reset Tender Date. In the event
that the Reset Remarketing Agent fails to purchase any Notes tendered on such
Reset Tender Date, then the Company is required unconditionally to repurchase
and retire such Notes.
(k) In connection with any Remarketing, the Reset Remarketing
Agent shall make, or shall cause the Trustee to make, payment to the DTC
Participant of each tendering
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Beneficial Owner of Senior Notes subject to remarketing, by book-entry through
DTC by the close of business on such Reset Tender Date against delivery through
DTC of such Beneficial Owner's tendered Senior Notes, of 100% of the principal
amount of the tendered Senior Notes that have been purchased for remarketing by
the Reset Remarketing Agent. The Company shall make, or cause the Trustee to
make, payment of interest to each Beneficial Owner of Senior Notes due on the
relevant Reset Tender Date by book-entry through DTC by the close of business on
such Reset Tender Date.
"Business Day" means any day other than a Saturday or Sunday
or a day on which banking institutions in The City of New York are required or
authorized to close and, in the case of Senior Notes in the Floating Interest
Rate Mode, that is also a London Business Day.
"Fixed Rate" means a per annum rate and will be determined by
adding the applicable Spread (as agreed to by the Company and the Reset
Remarketing Agent on the preceding Spread Determination Date) to the yield to
maturity (expressed as a bond equivalent, on the basis of a year of 365 or 366
days, as applicable, and applied on a daily basis) of the applicable United
States Treasury security, selected by the Rate Agent or its agent after
consultation with the Reset Remarketing Agent, as having a maturity comparable
to the duration selected for the following Subsequent Spread Period, which would
be used in accordance with customary financial practice in pricing new issues of
corporate debt securities of comparable maturity to the duration selected for
the following Subsequent Spread Period.
"Initial Spread Period" means the period from and including
June 23, 1998 to but excluding June 30, 2008.
"LIBOR" means the London interbank offered rate and shall be
determined by the Rate Agent as provided below:
(i) LIBOR will be determined on the basis of the
offered rate for deposits in U.S. Dollars of the applicable Index
Maturity commencing on the second London Business Day immediately
following such LIBOR Determination Date, which appears on Telerate Page
3750 (as defined below) as of approximately 11:00 a.m., London time, on
such LIBOR Determination Date. "Telerate Page 3750" means the display
designated on page "3750" on Dow Xxxxx Markets Limited or any successor
thereto (or such other page as may replace the 3750 page on that
service or such other service or services as may be nominated by the
British Bankers' Association for the purpose of displaying London
interbank offered rates for U.S. Dollar deposits). If no such offered
rate appears on Telerate Page 3750, LIBOR for such LIBOR Determination
Date will be determined in accordance with the provisions of paragraph
(ii) below. The term "London Business Day" means any day on which
dealings in deposits in U.S. Dollars are transacted in the London
interbank market.
(ii) With respect to a LIBOR Determination Date on
which no rate appears on Telerate Page 3750 as of approximately 11:00
a.m., London time, on such LIBOR Determination Date, the Rate Agent
shall request the principal London offices of each of four major
reference banks in the London interbank market selected by the Rate
Agent (after consultation with the Company) to provide the Rate Agent
with a quotation of the rate at which deposits in U.S. Dollars of the
applicable Index Maturity commencing on the second
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London Business Day immediately following such LIBOR Determination
Date, are offered by it to prime banks in the London interbank market
as of approximately 11:00 a.m., London time, on such LIBOR
Determination Date and in a principal amount equal to an amount of not
less than U.S. $1,000,000 that is representative for a single
transaction in such market at such time. If at least two such
quotations are provided, LIBOR for such LIBOR Determination Date will
be the arithmetic mean of such quotations as calculated by the Rate
Agent. If fewer than two quotations are provided, LIBOR for such LIBOR
Determination Date will be the arithmetic mean of the rates quoted as
of approximately 11:00 a.m., New York City time, on such LIBOR
Determination Date by three major banks in The City of New York
selected by the Rate Agent (after consultation with the Company) for
loans in U.S. Dollars to leading European banks, of the applicable
Index Maturity commencing on the second London Business Day immediately
following such LIBOR Determination Date and in a principal amount equal
to an amount of not less than U.S. $1,000,000 that is representative
for a single transaction in such market at such time; provided,
however, that if the banks selected as aforesaid by the Rate Agent are
not quoting as mentioned in this sentence, LIBOR for such LIBOR
Determination Date will be LIBOR determined with respect to the
immediately preceding LIBOR Determination Date.
The Index Maturity applicable to Notes in the Floating Rate
Interest Mode will be, in the case of Notes paying (i) monthly, one month; (ii)
quarterly, three months; and (iii) semi-annually, six months.
"Reinvestment Spread" means, with respect to the Senior Notes,
a number, expressed as a number of basis points or as a percentage, selected by
the Company and agreed to by the Reset Remarketing Agent on the
Duration/Interest Mode Determination Date.
"Reset Tender Notice" means the written notice by each
Beneficial Owner to the Reset Remarketing Agent of a Senior Note of its
intention to tender Senior Notes for purchase and remarketing, which notice must
be received by the Reset Remarketing Agent during the period commencing at 3:00
p.m., New York City time, on the Spread Determination Date and ending at 12:00
noon, New York City time, on the second Business Day following such Spread
Determination Date for such Subsequent Spread Period (the "Notice Date").
"Subsequent Spread Period" means any Spread Period either (i)
after the Initial Spread Period, if the Remarketing Right has not been exercised
or (ii) after the Second Remarketing Date, if the Remarketing Right is
exercised.
Section 3. Fees and Expenses. The obligations of the Company
to pay to the Reset Remarketing Agent on each Reset Tender Date the fees and
expenses set forth in the applicable Supplement
shall survive the termination of this Agreement and remain in full force and
effect until all such payments shall have been made in full.
Section 4. Removal of the Reset Remarketing Agent. With
respect to any Subsequent Spread Period, the Company may in its absolute
discretion remove the Reset Remarketing Agent by giving notice to the Reset
Remarketing Agent prior to 3:00 p.m., New York City time, on the Duration/Mode
Determination Date applicable thereto, such removal to be effective
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upon the Company's appointment of a successor Reset Remarketing Agent. In such
case, the Company will use its best efforts to appoint a successor Reset
Remarketing Agent and enter into such a with such
persons as soon as reasonably practicable.
Section 5. Covenants of the Company. The Company covenants
with the Reset Remarketing Agent as follows:
(a) The Company will provide prompt notice by telephone,
confirmed in writing (which may include facsimile or other electronic
transmission), to the Reset Remarketing Agent of (i) any notification or
announcement by a "nationally recognized statistical rating organization" (as
defined by the Commission for purposes of Rule 436(g)(2) under the 0000 Xxx)
with regard to the ratings of any securities of the Company, including, without
limitation, notification or announcement of a downgrade in or withdrawal of the
rating of any security of the Company or notification or announcement of the
placement of any rating of any securities of the Company under surveillance or
review, including placement on CreditWatch or on Watch List with negative
implications, or (ii) the occurrence at any time of any event set forth in
Section 8(b) of this Agreement.
(b) (i) The Company shall furnish to the Reset Remarketing
Agent, if the Reset Remarketing Agent determines, based on advice of
counsel, that changes in applicable law, regulations or interpretations
of the Securities and Exchange Commission make it necessary or
advisable to deliver a current prospectus in connection with a
Remarketing, a then currently effective registration statement under
the 1933 Act and a then current prospectus relating to the Senior Notes
(and Collateral Bonds, if applicable) to be used by the Reset
Remarketing Agent for remarketing and resale of the Senior Notes (such
registration statement (whether consisting of the registration
statement relating to the initial issuance of the Senior Notes and
Collateral Bonds, or any amendment thereto or a new registration
statement) and any amendments thereto, including any such prospectus
(whether consisting of the prospectus relating to the initial issuance
of the Senior Notes and Collateral Bonds or any amendment or supplement
thereto or a new prospectus) relating to the Senior Notes (and
Collateral Bonds, if applicable) constituting a part thereof, and all
documents incorporated therein by reference, as from time to time
amended or supplemented pursuant to the 1934 Act, the 1933 Act, or
otherwise, are referred to herein as the "Registration Statement" and
the "Prospectus," respectively, except that if any revised prospectus
shall be provided to the Reset Remarketing Agent by the Company for use
in connection with the remarketing of the Senior Notes which differs
from the Prospectus on file at the Commission at the time the
Registration Statement becomes effective, the term "Prospectus" shall
refer to such revised prospectus from and after the time it is first
provided to the Reset Remarketing Agent for such use); and
(ii) The Company shall also furnish to the Reset
Remarketing Agent in connection with the remarketing of Senior Notes
such other information as the Reset Remarketing Agent may reasonably
request from time to time.
The Company agrees, at its expense, to provide the Reset Remarketing
Agent with as many copies of the foregoing written materials and other Company
approved information as the Reset
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Remarketing Agent may reasonably request for use in connection with the
remarketing of Senior Notes and consents to the use thereof for such purpose.
(c) If, at any time during which the Reset Remarketing Agent
would be obligated to take any action under this Agreement, any event or
condition known to the Company relating to or affecting the Company, any
subsidiary thereof or the Senior Notes shall occur which could reasonably be
expected to cause any of the reports, documents, materials or information
referred to in paragraph (b) above or any document incorporated therein by
reference (collectively, the "Reset Remarketing Materials") to contain an untrue
statement of a material fact or omit to state a material fact, the Company shall
promptly notify the Reset Remarketing Agent in writing of the circumstances and
details of such event or condition.
(d) So long as the Senior Notes are outstanding, the Company
will file all documents required to be filed with the Commission pursuant to the
1934 Act within the time periods required by the 1934 Act and the 1934 Act
Regulations.
(e) Except as otherwise provided herein, the Company agrees
that neither it nor any of its subsidiaries or affiliates shall defease,
purchase or otherwise acquire, or enter into any agreement to defease, purchase
or otherwise acquire, any of the Senior Notes prior to the remarketing thereof
by the Reset Remarketing Agent.
(f) Notwithstanding any provision to the contrary set forth in
the Indenture, the Company shall (i) use its best efforts to maintain the Senior
Notes in book-entry form with The Depository Trust Company ("DTC") or any
successor thereto and to appoint a successor depositary to the extent necessary
to maintain the Senior Notes in book-entry form, and (ii) waive any
discretionary right it otherwise has under the Indenture to cause the Senior
Notes to be issued in certificated form.
Section 6. Dealing in the Senior Notes; Purchase of Senior
Notes by the Company. (a) Xxxxxxx Xxxxx, when acting as Reset Remarketing Agent
or in its individual or any other capacity, may, to the extent permitted by law,
buy, sell, hold and deal in any of the Senior Notes. Xxxxxxx Xxxxx, as Holder or
Beneficial Owner of the Senior Notes may exercise any vote or join as a Holder
or Beneficial Owner, as the case may be, in any action which any Holder or
Beneficial Owner of Senior Notes may be entitled to exercise or take pursuant to
the Indenture with like effect as if it did not act in any capacity hereunder.
Xxxxxxx Xxxxx, in its individual capacity, either as principal or agent, may
also engage in or have an interest in any financial or other transaction with
the Company as freely as if it did not act in any capacity hereunder.
(b) The Company may purchase Senior Notes in the remarketing,
provided that the Interest Rate established with respect to the Senior Notes in
any such Remarketing is not different from the Interest Rate that would have
been established if the Company had not purchased such Senior Notes.
Section 7. Representations and Warranties by the Company. The
Company represents and warrants to the Reset Remarketing Agent, as of the date
hereof, as of the Effective Date, and as of each Reset Tender Date (each, a
"Representation Date") as follows:
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(a) It has made all the filings with the Commission that it is
required to make under the Securities Exchange Act of 1934, as amended (the
"1934 Act"), and the rules and regulations thereunder (the "1934 Act
Regulations") (collectively, the "1934 Act Documents"), (ii) each 1934 Act
Document complies in all material respects with the requirements of the 1934 Act
and 1934 Act Regulations, and each 1934 Act Document did not at the time of
filing with the Commission, and as of each Representation Date, as modified or
superseded by any subsequently filed 1934 Act Document on or prior to such
Representation Date, will not, include an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading and (iii) the applicable Reset Remarketing
Materials (as defined herein), as of each Representation Date after the date
hereof, as modified or superseded by any subsequently filed 1934 Act Document on
or prior to such Representation Date (or, if applicable, by any document filed
pursuant to the 1933 Act and the rules and regulations thereunder (the "1933 Act
Regulations")), will not include an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary in order to
make the statements therein, in the light of the circumstances under which they
were made, not misleading.
(b) The Company further represents and warrants to the Reset
Remarketing Agent as of each Representation Date as follows:
(i) The accountants who certified the financial
statements and supporting schedules included or incorporated by
reference in the 1934 Act Documents are independent public accountants
as required by the 1933 Act and the 1933 Act Regulations.
(ii) The financial statements included or
incorporated by reference in the 1934 Act Documents, together with the
related schedules and notes, present fairly the financial position of
the Company and its consolidated subsidiaries at the dates indicated
and the statement of operations, stockholders' equity and cash flows of
the Company and its consolidated subsidiaries for the periods
specified; such financial statements have been prepared in conformity
with generally accepted accounting principles ("GAAP") applied on a
consistent basis throughout the periods involved. The supporting
schedules, if any, included or incorporated by reference in the 1934
Act Documents present fairly in accordance with GAAP the information
required to be stated therein. The pro forma financial statements and
the related notes thereto, if any, included or incorporated by
reference in the 1934 Act Documents present fairly the information
shown therein, have been prepared in accordance with the Commission's
rules and guidelines with respect to pro forma financial statements and
have been properly compiled on the bases described therein, and the
assumptions used in the preparation thereof are reasonable and the
adjustments used therein are appropriate to give effect to the
transactions and circumstances referred to therein.
(iii) Since the respective dates as of which
information is given in the 1934 Act Documents, except as otherwise
stated therein, (A) there has been no material adverse change and no
development which could reasonably be expected to result in a material
adverse change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise, whether or not arising in
the ordinary course of business (a "Material Adverse
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Effect"), (B) there have been no transactions entered into by the
Company or any of its subsidiaries, other than those in the ordinary
course of business, which are material with respect to the Company and
its subsidiaries considered as one enterprise, and (C) except for
regular quarterly dividends on the Company's common stock in amounts
per share that are consistent with past practice, there has been no
dividend or distribution of any kind declared, paid or made by the
Company on any class of its capital stock.
(iv) The Company has been duly organized and is
validly existing as a corporation in good standing under the laws of
the State of Michigan, with corporate power and authority to own, lease
and operate its properties and to conduct its business as presently
conducted and as described in the 1934 Act Documents and to enter into
and perform its obligations under this Agreement; and the Company is
duly qualified as a foreign corporation to transact business and is in
good standing in each other 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 so to qualify or to
be in good standing would not result in a Material Adverse Effect.
(v) The shares of issued and outstanding capital
stock of the Company have been duly authorized and validly issued and
are fully paid and non-assessable; none of the outstanding shares of
capital stock of the Company was issued in violation of the preemptive
or other similar rights arising by operation of law, under the charter
or by-laws of the Company, under any agreement to which the Company or
any of its subsidiaries is a party or otherwise.
(vi) Each subsidiary of the Company has been duly
organized and is validly existing as a corporation in good standing
under the laws of the jurisdiction of its incorporation, with corporate
power and authority to own, lease and operate its properties and to
conduct its business as presently conducted and as described in the
1934 Act Documents 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 so to qualify or to be in good standing would not result in a
Material Adverse Effect; except as otherwise disclosed in the 1934 Act
Documents, all of the issued and outstanding capital stock of each such
subsidiary has been duly authorized and validly issued, is fully paid
and non-assessable and is owned by the Company, as the case may be,
directly or through subsidiaries, free and clear of any security
interest, mortgage, pledge, lien, encumbrance, claim or equity; none of
the outstanding shares of capital stock of any such subsidiary was
issued in violation of the preemptive or similar rights of any
securityholder of such subsidiary.
(vii) This and the Supplement have been duly authorized, executed
and delivered by the Company.
(viii) The Indenture has been duly authorized,
executed and delivered by the Company and duly qualified under the
Trust Indenture Act of 1939, as amended (the "1939 Act"), and, assuming
it has been duly executed and delivered by the Trustee,
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constitutes a valid and binding agreement of the Company, enforceable
against the Company in accordance with its terms, except as the
enforcement thereof may be limited by bankruptcy, insolvency
(including, without limitation, all laws relating to fraudulent
transfers, reorganization, moratorium or similar laws affecting
enforcement of creditors' rights generally and except as enforcement
thereof is subject to general principles of equity (regardless of
whether enforcement is considered in a proceeding in equity or at
law)(the "Bankruptcy Exceptions").
(ix) The issuance and delivery by the Company of the
Collateral Bonds to the Trustee constitute a sale by the Company of the
Collateral Bonds to the Trustee as of the Closing Date or, if not a
sale, the grant by the Company to the Trustee of a perfected security
interest in the Collateral Bonds for the benefit of the holders of the
Senior Notes.
(x) The Secured Indenture constitutes a legally valid
and direct enforceable first mortgage lien, except as the same may be
limited by the laws of the State of Michigan (where all of the property
covered thereby is located) affecting the remedies for the enforcement
of the security provided for therein, which laws do not make inadequate
the remedies necessary for the realization of the benefits of such
security, or as the same may be limited by the Bankruptcy Exceptions,
upon substantially all of the Company's properties and franchises, now
owned or hereafter acquired, free from all prior liens, charges or
encumbrances, except as set forth in subparagraph (xviii) below, and
except, in the case of property hereafter acquired, any thereof
existing at the time of acquisition.
(xi) The Senior Notes have been duly authorized and
executed by the Company and authenticated, issued and delivered in the
manner provided for in the Indenture, and constitute valid and binding
obligations of the Company, enforceable against the Company in
accordance with their terms, except as the enforcement thereof may be
limited by bankruptcy, insolvency (including, without limitation, all
laws relating to fraudulent transfers), reorganization, moratorium or
similar laws affecting enforcement of creditors' rights generally and
except as enforcement thereof is subject to general principles of
equity (regardless of whether enforcement is considered in a proceeding
in equity or at law), and are in the form contemplated by, and entitled
to the benefits of, the Indenture.
(xii) The Collateral Bonds have been duly authorized
and executed by the Company and authenticated, issued, and delivered in
the manner provided for in the Secured Indenture and have been issued
and delivered to the Trustee as provided for in the Thirty-Fifth
Supplemental Indenture as security for the Senior Notes, and constitute
legal, valid and binding obligations of the Company, enforceable
against the Company in accordance with their terms except to the extent
that enforcement thereof may be limited by the Bankruptcy Exceptions.
The Collateral Bonds are in the form contemplated by, and entitled to
the benefits of, the Secured Indenture.
(xiii) Neither the Company nor any of its
subsidiaries is in violation of its charter or by-laws or in default in
the performance or observance of any material obligation, agreement,
covenant or condition contained in any contract, indenture, mortgage,
deed of trust, loan or credit agreement, note, lease or other agreement
or instrument to which the
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Company or any of its respective subsidiaries is a party or by which it
or any of them may be bound, or to which any of the property or assets
of the Company or any subsidiary is subject (collectively, "Agreements
and Instruments") or in violation of any applicable law, rule or
regulation or any judgment, order, writ or decree of any government,
governmental instrumentality or court, domestic or foreign, having
jurisdiction over the Company or any of its subsidiaries or any of
their respective properties or assets, which violation or default
would, singly or in the aggregate, have a Material Adverse Effect.
(xiv) The execution, delivery and performance of the
Purchase Agreement, this Agreement, the Mandatory Tender Remarketing
Agreement, the Indenture, the Senior Notes, the Thirty-Fifth
Supplemental Indenture, the Collateral Bonds and any other agreement or
instrument entered into or issued or to be entered into or issued by
the Company in connection with the transactions contemplated hereby or
thereby; and the consummation of the transactions contemplated herein
and therein and compliance by the Company with its obligations
hereunder and under the Indenture, the Secured Indenture, the
Thirty-Fifth Supplemental Indenture, the Senior Notes, and the
Collateral Bonds have been duly authorized by all necessary corporate
action and do not and will not, whether with or without the giving of
notice or passage of time or both, conflict with or constitute a breach
of, or default or Repayment Event (as defined below) under, or result
in the creation or imposition of any lien, charge or encumbrance upon
any property or assets of the Company or any subsidiary pursuant to
(other than the lien of the Indenture on the Collateral Bonds), the
Agreements and Instruments (except for such conflicts, breaches or
defaults or liens, charges or encumbrances that would not result in a
Material Adverse Effect), nor will such action result in any violation
of the provisions of the charter or by-laws of the Company or any
subsidiary or any applicable law, statute, rule, regulation, judgment,
order, writ or decree of any government, government instrumentality or
court, domestic or foreign, having jurisdiction over the Company or any
subsidiary or any of their assets, properties or operations. As used
herein, a "Repayment Event" means any event or condition which gives
the holder of any note, debenture or other evidence of indebtedness (or
any person acting on such holder's behalf) the right to require the
repurchase, redemption or repayment of all or a portion of such
indebtedness by the Company or any subsidiary.
(xv) There is no action, suit, proceeding, inquiry or
investigation before or brought by any court or governmental agency or
body, domestic or foreign, now pending, or, to the knowledge of the
Company, threatened, against or affecting the Company or any
subsidiary, which is required to be disclosed in the 1934 Act Documents
(other than as disclosed therein), or which might reasonably be
expected to result in a Material Adverse Effect, or which might
reasonably be expected to materially and adversely affect the
properties or assets thereof or the consummation of the transactions
contemplated in this Agreement or the performance by the Company of its
obligations hereunder; the aggregate of all pending legal or
governmental proceedings to which the Company or any subsidiary is a
party or of which any of their respective property or assets is the
subject which are not described in the 1934 Act Documents, including
ordinary routine litigation incidental to the business, could not
reasonably be expected to result in a Material Adverse Effect.
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(xvi) No filing with, or authorization, approval,
consent, license, order, registration, qualification or decree of, any
court or governmental authority or agency is necessary or required for
the performance by the Company of its obligations hereunder, in
connection with the remarketing of the Senior Notes hereunder or the
consummation of the transactions contemplated by this Agreement or for
the due execution, delivery or performance of the Indenture by the
Company, except such as have or shall have been already obtained.
(xvii) No labor dispute with the employees of the
Company or any of its subsidiaries exists or, to the knowledge of the
Company, is imminent, and neither the Company is aware of any existing
or imminent labor disturbance by the employees of any of its or any of
its subsidiary's principal suppliers, manufacturers, customers or
contractors which, in either case, may reasonably be expected to result
in a Material Adverse Effect.
(xviii) There are no contracts or documents which are
required to be described in the Registration Statement, the Prospectus
or the documents incorporated by reference therein or to be filed as
exhibits thereto which have not been so described and/or filed as
required.
(xix) The Company has good and marketable title to
the properties specifically described in and conveyed by the Secured
Indenture (except such property as may have been disposed of or
released from the lien thereof in accordance with the terms thereof)
subject only to the lien of the Secured Indenture, to permissible
encumbrances, as defined in the Secured Indenture, as to property
acquired by the Company subsequent to the execution of the Original
Secured Indenture, to any liens existing thereon or purchase money
liens placed thereon at the time of such acquisition as permitted by
the Secured Indenture, and to certain other reservations, rights of
grantors under revocable permits, easements, licenses, zoning laws and
ordinances and restrictions and minor defects or irregularities of
title which do not materially impair the use of the property affected
thereby in the operation of the business of the Company; the Company
and its subsidiaries have good and marketable title to all personal
property owned by them, in each case free and clear of all liens,
encumbrances and defects except the liens of the Secured Indenture and
such liens, encumbrances and defects as do not materially affect the
value of such property and do not interfere with the use made and
proposed to be made of such property by the Company and its
subsidiaries; and any real property and buildings held under lease by
the Company and its subsidiaries are held by them under valid,
subsisting and enforceable leases with such exceptions as are not
material and do not interfere with the use made and proposed to be made
of such property and buildings by the Company and its subsidiaries; the
pipeline, distribution main and underground gas storage easements
enjoyed by the Company and its subsidiaries are valid, subsisting and
enforceable easements with such exceptions as are not material and do
not interfere with the conduct of the business of the Company and its
subsidiaries.
(xx) The Company and its subsidiaries possess all
licenses, franchises, permits, certificates, authorizations, approvals,
consents, orders and other operating rights (collectively, the
"Governmental Licenses") issued by the Federal Energy Regulatory
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Commission, the State of Michigan, and all other federal, state, local
or foreign regulatory agencies or bodies, governmental authorities or
agencies necessary for the ownership or lease of the material
properties owned or leased by each of them and to conduct the business
now operated by each of them; the Company and its subsidiaries are in
compliance with the terms and conditions of all such Governmental
Licenses, except where the failure to so comply would not, singly or in
the aggregate, have a Material Adverse Effect; all of the Governmental
Licenses are valid and in full force and effect and contain no unduly
burdensome provisions that would interfere with the conduct of the
business of the Company and its subsidiaries, considered as one
enterprise and, except as otherwise set forth in the Registration
Statement and the Prospectus, there are no legal or governmental
proceedings pending or threatened that would result in a material
modification, suspension or revocation thereof.
(xxi) Except as described in any Reset Remarketing
Materials and except as would not, singly or in the aggregate, result
in a Material Adverse Effect, (A) neither the Company nor any of its
subsidiaries is in violation of any federal, state, local or foreign
statute, law, rule, regulation, ordinance or code, including any
judicial or administrative order, consent, decree or judgment, relating
to pollution or protection of human health, the environment (including,
without limitation, ambient air, surface water, groundwater, land
surface or subsurface strata) or wildlife, including, without
limitation, laws and regulations relating to the release or threatened
release of chemicals, pollutants, contaminants, wastes, toxic
substances, hazardous substances, petroleum or petroleum products
(collectively, "Hazardous Materials") or to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport
or handling of Hazardous Materials (collectively, the "Environmental
Laws"), (B) the Company and its subsidiaries have all permits,
authorizations and approvals required under any applicable
Environmental Laws and are in compliance with their requirements, and
(C) there are no pending or threatened administrative, regulatory or
judicial actions, suits, demands, demand letters, claims, liens,
notices of noncompliance or violation, investigation or proceedings
relating to any Environmental Law against the Company or any of its
subsidiaries.
(xxii) The Company is a "public utility company" and
a "subsidiary company" of MCN Energy Group, a "holding company," as
such terms are defined in the Public Utility Holding Company Act of
1935 (the "1935 Act"), and such "holding company" and the Company are
presently exempt from the provisions of the 1935 Act (except Section 9
thereof).
(xxiii) The Company has complied with, and is and
will be in compliance with, the provisions of that certain Florida act
relating to disclosure of doing business with Cuba, codified as Section
517.075 of the Florida statutes, and the rules and regulations
thereunder (collectively, the "Cuba Act") or is exempt therefrom.
(xxiv) None of the Company and its subsidiaries or
any of their respective directors, officers or controlling persons, has
taken or will take, directly or indirectly, any action resulting in a
violation of Regulation M under the 1934 Act, or designed to cause or
result in, or that has constituted or that reasonably might be expected
to constitute, the
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stabilization or manipulation of the price of any security of the
Company to facilitate the remarketing of the Senior Notes.
(xxv) No "forward looking statement" (as defined in
Rule 175 under the 0000 Xxx) contained in the Registration Statement,
any preliminary prospectus or the Prospectus was made or reaffirmed
without a reasonable basis or was disclosed other than in good faith.
(xxvi) The Company is not an "investment company" or
an entity "controlled" by an "investment company" as such terms are
defined in the Investment Company Act of 1940, as amended.
(xxvii) The Senior Notes are rated "A2" by Xxxxx'x
Investors Service, Inc. and "A" by Standard & Poor's Rating Services, a
division of the XxXxxx-Xxxx Companies, Inc. or such other rating as to
which the Company shall have most recently notified the Reset
Remarketing Agent pursuant to Section 3(a) hereof.
References in the foregoing representations and warranties to the 1934
Act Documents shall be deemed to refer to the Registration Statement (as defined
in Section 5(b) below) and Prospectus (as defined in Section 5(b) above), in
each case including the documents incorporated by reference therein, if such are
required pursuant to such Section 5(b).
Section 8. Conditions to the Reset Remarketing Agent's
Obligations. The obligations of the Reset Remarketing Agent under this Agreement
have been undertaken in reliance on, and shall be subject to,
(a) the due performance by the Company of its obligations and
agreements as set forth in this Agreement and the accuracy of the
representations and warranties in this Agreement and any certificate delivered
pursuant hereto, and
(b) the further condition that none of the following events
shall have occurred at any time:
(i) the rating of any securities of the Company shall
have been down-graded or put under surveillance or review, including
being put on CreditWatch or Watch List with negative implications, or
withdrawn by a nationally recognized statistical rating organization;
(ii) without the prior written consent of the Reset
Remarketing Agent, neither the Indenture (including the Senior Notes)
nor the Secured Indenture (including the Collateral Bonds) shall have
been amended in any manner, or otherwise contain any provision not
contained therein as of the date hereof, that in either case in the
judgment of the Reset Remarketing Agent materially and adversely
changes the nature of the Senior Notes or the Collateral Bonds, as the
case may be, or the remarketing procedures (it being understood that,
notwithstanding the provisions of this clause (ii), the Company shall
not be prohibited from amending the Indenture);
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(iii) trading in any securities of the Company or any
of its affiliates shall have been suspended or materially limited by
the Commission or the New York Stock Exchange, or if trading generally
on the American Stock Exchange or the New York Stock Exchange or in the
Nasdaq National Market shall have been suspended or materially limited,
or minimum or maximum prices for trading shall have been fixed, or
maximum ranges for prices shall have been required, by any of said
exchanges or by such system or by order of the Commission, the National
Association of Securities Agents, Inc. or any other governmental
authority, or if a banking moratorium shall have been declared by
either Federal or New York authorities;
(iv) there shall have occurred any material adverse
change in the financial markets in the United States or the
international financial markets, any outbreak of hostilities or
escalation thereof or other calamity or crisis or any change or
development involving a prospective change in national or international
political, financial or economic conditions, in each case the effect of
which is such as to make it, in the judgment of the Reset Remarketing
Agent, impracticable to remarket the Senior Notes or to enforce
contracts for the sale of the Senior Notes;
(v) an Event of Default (as defined in the
Indenture), or any event which, with the giving of notice or passage of
time, or both, would constitute an Event of Default, with respect to
the Senior Notes shall have occurred and be continuing;
(vi) a material adverse change in the condition,
financial or otherwise, or in the earnings, business affairs or
business prospects of the Company and its subsidiaries considered as
one enterprise, whether or not arising in the ordinary course of
business, shall have occurred; or
(vii) the Senior Notes are not maintained in
book-entry form with DTC or any successor thereto; provided, that the
Reset Remarketing Agent, in its sole discretion and subject to receipt
of an opinion of counsel for the Company reasonably satisfactory to the
Reset Remarketing Agent, may waive the foregoing condition if in the
Reset Remarketing Agent's judgment the Indenture and the Senior Notes
can be amended, and they are amended, so as to permit the remarketing
of the Senior Notes in certificated form and otherwise as contemplated
herein;
(c) The obligations of the Reset Remarketing Agent to purchase
and remarket the Senior Notes shall also be subject to the terms and conditions
of the applicable Reset Remarketing Agreement Supplement.
Section 9. Indemnification. (a) The Company agrees to
indemnify and hold harmless the Reset Remarketing Agent and its officers,
directors and employees and each person, if any, who controls the Reset
Remarketing Agent within the meaning of Section 20 of the 1934 Act as follows:
(i) against any loss, liability, claim, damage or
expense whatsoever (collectively, "Damages"), as incurred, arising out
of, (A) the failure to have an effective
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Registration Statement under the 1933 Act relating to the Senior Notes,
if required, or the failure to satisfy the prospectus delivery
requirements of the 1933 Act because the Company failed to provide the
Reset Remarketing Agent with a Prospectus for delivery, as required by
Section 5 hereof, or (B) any untrue statement or alleged untrue
statement of a material fact contained in any of the Reset Remarketing
Materials (including any incorporated documents), or (C) the omission
or alleged omission therefrom of a material fact necessary to make the
statements therein, in the light of the circumstances in which they
were made, not misleading, or (D) any violation by the Company of, or
any failure by the Company to perform any of its obligations under,
this Agreement, or (E) the acts or omissions of the Reset Remarketing
Agent in connection with its duties and obligations to determine the
Interest Rate or other terms with respect to any Subsequent Spread
Period, as provided hereunder, except Damages that are finally
judicially determined to be due to its gross negligence or willful
misconduct;
(ii) against any and all loss, liability, claim,
damage and expense whatsoever, as incurred, to the extent of the
aggregate amount paid in settlement of any litigation, or investigation
or proceeding by any governmental agency or body, commenced or
threatened, or of any claim whatsoever arising out of, or based upon,
any of items (A) through (E) in clause (i) above; provided that
(subject to clause (d) below) such settlement is effected with the
written consent of the Company, which consent shall not be unreasonably
withheld; and
(iii) against any and all expense whatsoever, as
incurred (including the fees and disbursements of counsel chosen by the
Reset Remarketing Agent), reasonably incurred in investigating,
preparing or defending against any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or threatened,
or any claim whatsoever arising out of, or based upon, any of items (A)
through (E) in clause (i) above to the extent that any such expense is
not paid under (i) or (ii) above;
provided, however, that the foregoing indemnity shall not apply to any losses,
liabilities, claims, damages and expenses to the extent arising out of any
untrue statement or omission made in reliance upon and in conformity with
written information furnished to the Company by the Reset Remarketing Agent
expressly for use in the Reset Remarketing Materials.
(b) Each indemnified party shall give notice as promptly as
reasonably practicable to each indemnifying party of any action commenced
against it in respect of which indemnity may be sought hereunder, but failure to
so notify an indemnifying party shall not relieve such indemnifying party from
any liability hereunder to the extent it is not materially prejudiced as a
result thereof and in any event shall not relieve it from any liability which it
may have otherwise than on account of this indemnity agreement. In the case of
parties indemnified pursuant to clause (a) above, counsel to the indemnified
parties shall be selected by Xxxxxxx Xxxxx, and, in the case of parties
indemnified pursuant to clause (b) above, counsel to the indemnified parties
shall be selected by the Company. An indemnifying party may participate at its
own expense in the defense of any such action; provided, however, that counsel
to the indemnifying party shall not (except with the consent of the indemnified
party) also be counsel to the indemnified party. In no event shall the
indemnifying parties be liable for fees and expenses of more than one counsel
(in addition to any
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local counsel) separate from their own counsel for all indemnified parties in
connection with any one action or separate but similar or related actions in the
same jurisdiction arising out of the same general allegations or circumstances.
No indemnifying party shall, without the prior written consent of the
indemnified parties, settle or compromise or consent to the entry of any
judgment with respect to any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim
whatsoever in respect of which indemnification or contribution could be sought
under this Section 9 or Section 10 hereof (whether or not the indemnified
parties are actual or potential parties thereto), unless such settlement,
compromise or consent (i) includes an unconditional release of each indemnified
party from all liability arising out of such litigation, investigation,
proceeding or claim and (ii) does not include a statement as to or an admission
or fault, culpability or a failure to act by or on behalf of any indemnified
party.
(c) If at any time an indemnified party shall have requested
an indemnifying party to reimburse the indemnified party for fees and expenses
of counsel, such indemnifying party agrees that it shall be liable for any
settlement of the nature contemplated by clause 9 (a) (ii) effected without its
written consent if (i) such settlement is entered into more than 45 days after
receipt by such indemnifying party of the aforesaid request, (ii) such
indemnifying party shall have received notice of the terms of such settlement at
least 30 days prior to such settlement being entered into and (iii) such
indemnifying party shall not have reimbursed such indemnified party in
accordance with such request prior to the date of such settlement.
(d) The indemnity agreements contained in this Section 10
shall remain operative and in full force and effect, regardless of any
investigation made by or on behalf of the Reset Remarketing Agent, and shall
survive the termination or cancellation of this Agreement and the remarketing of
any Senior Notes hereunder.
Section 10. Contribution. If the indemnification provided for
in Section 9 hereof is for any reason unavailable to or insufficient to hold
harmless an indemnified party in respect of any losses, liabilities, claims,
damages or expenses referred to therein, then each indemnifying party shall
contribute to the aggregate amount of such losses, liabilities, claims, damages
and expenses incurred by such indemnified party, as incurred, (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company on the one hand and the Reset Remarketing Agent on the other hand from
the remarketing of the Senior Notes pursuant to this Agreement or (ii) if the
allocation provided by clause (i) is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of the Company on the one
hand and of the Reset Remarketing Agent on the other hand in connection with the
acts, failures to act, statements or omissions which resulted in such losses,
liabilities, claims, damages or expenses, as well as any other relevant
equitable considerations.
The relative benefits received by the Company on the one hand
and the Reset Remarketing Agent on the other hand in connection with the
remarketing of the Senior Notes pursuant to this Agreement shall be deemed to be
in the same respective proportions as (i) the aggregate principal amount of the
Senior Notes, and (ii) the aggregate positive difference, if any, between the
price at which the Senior Notes are sold by the Reset Remarketing Agent in the
remarketing and the price paid by the Reset Remarketing Agent for the Senior
Notes tendered on any Reset Tender Date.
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The relative fault of the Company on the one hand and the
Reset Remarketing Agent on the other hand shall be determined by reference to,
among other things, the responsibility hereunder of the applicable party for any
act or failure to act relating to the losses, liabilities, claims, damages or
expenses incurred or, in the case of any losses, liabilities, claims, damages or
expenses arising out of any untrue or alleged untrue statement of a material
fact contained in any of the Reset Remarketing Materials or the omission or
alleged omission to state a material fact therefrom, whether any such untrue or
alleged untrue statement of a material fact or omission or alleged omission to
state a material fact relates to information supplied by the Company or by the
Reset Remarketing Agent and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Company and the Reset Remarketing Agent agree that it
would not be just and equitable if contribution pursuant to this Section 10 were
determined by pro rata allocation or by any other method of allocation which
does not take account of the equitable considerations referred to above in this
Section 10. The aggregate amount of losses, liabilities, claims, damages and
expenses incurred by an indemnified party and referred to above in this Section
10 shall be deemed to include any legal or other expenses reasonably incurred by
such indemnified party in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever based upon any such act
or failure to act or untrue or alleged untrue statement or omission or alleged
omission.
Notwithstanding the provisions of this Section 10, the Reset
Remarketing Agent shall not be required to contribute any amount in excess of
the amount by which the total price at which the Senior Notes remarketed by it
and resold to the public were sold to the public exceeds the amount of any
damages which the Reset Remarketing Agent has otherwise been required to pay by
reason of any act or failure to act for which it is responsible hereunder or any
untrue or alleged untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the 0000 Xxx) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 11, each person, if any, who
controls the Reset Remarketing Agent within the meaning of Section 15 of the
1933 Act or Section 20 of the 1934 Act shall have the same rights to
contribution as the Reset Remarketing Agent, and each officer and director of
the Company who signed the Registration Statement, and each person, if any, who
controls the Company within the meaning of Section 15 of the 1933 Act or Section
20 of the 1934 Act shall have the same rights to contribution as the Company.
Section 11. Termination of this Reset Remarketing Agreement.
Subject to Section 3 hereof relating to the payment of fees and expenses, this
Agreement shall terminate as to the Reset Remarketing Agent on the effective
date of the removal of such Reset Remarketing Agent pursuant to Section 4
hereof.
Section 12. Reset Remarketing Agent's Performance: Duty of
Care. The duties and obligations of the Reset Remarketing Agent hereunder shall
be determined solely by the express
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provisions of this Agreement, the Senior Notes and the Indenture, the Secured
Indenture and the Collateral Bonds and the applicable Reset Remarketing
Agreement Supplement. No implied covenants or obligations of or against the
Reset Remarketing Agent shall be read into this Agreement, the Indenture or the
Secured Indenture. In the absence of bad faith on the part of the Reset
Remarketing Agent, the Reset Remarketing Agent may conclusively rely upon any
document furnished to it, which purports to conform to the requirements of this
Agreement, the Indenture, or the Secured Indenture, as to the truth of the
statements expressed in any of such documents. The Reset Remarketing Agent shall
be protected in acting upon any document or communication reasonably believed by
it to have been signed, presented or made by the proper party or parties. The
Reset Remarketing Agent shall incur no liability hereunder to any Beneficial
Owner or Holder of Senior Notes in its individual capacity or as Reset
Remarketing Agent for any action or failure to act in connection with the
remarketing or otherwise. The Reset Remarketing Agent shall incur no liability
to the Company with respect to calculation of the Interest Rate applicable to
any Interest Period, except as a result of gross negligence or willful
misconduct on its part.
Section 13. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO
CONTRACTS MADE AND TO BE PERFORMED IN SUCH STATE.
Section 14. Term of Agreement. Unless otherwise terminated in
accordance with the provisions hereof, this Agreement shall remain in full force
and effect from the date hereof until the first day thereafter on which no
Senior Notes are outstanding.
Section 15. Successors and Assigns. The rights and obligations
of the Company hereunder may not be assigned or delegated to any other person
without the prior written consent of Xxxxxxx Xxxxx, the rights and obligations
of Xxxxxxx Xxxxx hereunder may not be assigned or delegated to any other person
without the prior written consent of the Company, and any attempt by either
party to do so will be unenforceable. This Agreement shall inure to the benefit
of and be binding upon the Company and Xxxxxxx Xxxxx and their respective
permitted successors and assigns. The terms "successors" and "assigns" shall not
include any purchaser of any Senior Notes merely because of such purchase.
Section 16. Headings. Section headings have been inserted in
this Agreement as a matter of convenience of reference only, and it is agreed
that such section headings are not a part of this Agreement and will not be used
in the interpretation of any provisions of this Agreement.
Section 17. Severability. If any provision of this Agreement
shall be held or deemed to be or shall, in fact, be invalid, inoperative or
unenforceable as applied in any particular case in any or all jurisdictions
because it conflicts with any provision of any constitution, statute, rule or
public policy or for any other reason, such circumstances shall not have the
effect of rendering the provision in question invalid, inoperative or
unenforceable in any other case, circumstances or jurisdiction, or of rendering
any other provision or provisions of this Agreement invalid, inoperative or
unenforceable to any extent whatsoever.
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Section 18. Counterparts. This Agreement may be executed in
several counterparts, each of which shall be regarded as an original and all of
which shall constitute one and the same document.
Section 19. Amendments. This Agreement may be amended by any
instrument in writing signed by each of the parties hereto.
Section 20. Notices. Unless otherwise specified, any notices,
requests, consents or other communications given or made hereunder or pursuant
hereto shall be made in writing or transmitted by any standard form of
telecommunication or by telephone and confirmed in writing. All written notices
shall be deemed to be validly given or made, if delivered by hand, when so
delivered, of if mailed, when mailed registered or certified mail, return
receipt requested and postage prepaid. All notices by telecommunication
(including telephone) shall be deemed to be validly given or made when received.
All such notices, requests, consents or other communications shall be addressed
as follows: if to the Company, to 000 Xxxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx 00000,
Attn: Xxxxxx X. Xxxxxxxxx, Esq., Vice President, General Counsel and Secretary,
Facsimile No.: (000) 000-0000; and if to Xxxxxxx Xxxxx, to Xxxxxxx Lynch,
Pierce, Xxxxxx & Xxxxx Incorporated, Xxxxxxx Xxxxx World Headquarters, World
Financial Center, Xxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000-0000, Attention: Debt
Syndicate, or to such other address as either of the above shall specify to the
other in writing.
Section 21. Benefit. (a) Nothing in this Agreement, express or
implied, is intended or shall be construed to confer upon or give any person
other than the parties hereto any remedy or claim under or by reason of this
Agreement or any term, covenant or condition hereof, all of which shall be for
the sole and exclusive benefit of the parties.
(b) No beneficial owner of any Note shall have any rights or
claims under this Agreement or any Remarketing Agreement Supplement or against
the Company or the Remarketing Agent as a result of the Remarketing Agent's not
purchasing such Notes.
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IN WITNESS WHEREOF, each of the Company and Xxxxxxx Xxxxx has
caused this Agreement to be executed in its name and on its behalf by one of its
duly authorized officers as of the date first above written.
MICHIGAN CONSOLIDATED GAS COMPANY
By:/s/ Xxxxxx X. Xxx III
-------------------------------
Name: Xxxxxx X. Xxx III
Title: Senior Vice President and
Chief Financial Officer
XXXXXXX XXXXX & CO.
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
By:/s/ Xxxxxxx X. Xxxxxx
-------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Managing Director
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EXHIBIT A
RESET REMARKETING AGREEMENT SUPPLEMENT
Xxxxxxx Xxxxx & Co./ Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated (the "Reset Remarketing Agent") hereby agrees to purchase the
Senior Notes described below (the "Senior Notes") that have been tendered by the
holders thereof for sale on _____________, _____ (the "Reset Tender Date").
It is acknowledged and agreed that the Senior Notes need not
be further registered under the Securities Act of 1933, as amended (the "Act"),
and that, in connection with the remarketing of the Senior Notes by the Reset
Remarketing Agent in accordance with the terms of the Reset Remarketing
Agreement dated as of June 23, 1998, no prospectus meeting the requirements of
Section 10 of the Act need be delivered, or filed pursuant to Rule 424 under the
Act.
It is understood that the Reset Remarketing Agent will deliver
to purchasers and prospective purchasers, in connection with the remarketing,
one or more forms of written communication describing the terms of the Senior
Notes (each, a "Reset Remarketing Memorandum"), the form of each of which shall
be delivered to Michigan Consolidated Gas Company, a Michigan corporation (the
"Company"), not less than two Business Days prior to its use and subject to the
approval of the Company prior to its use by the Reset Remarketing Agent, which
approval shall not be unreasonably withheld or delayed.
The Reset Remarketing Agent shall offer to purchase Senior
Notes and purchase validly tendered Senior Notes on the Reset Tender Date in
accordance with all applicable laws and regulations and interpretations of the
Securities and Exchange Commission.
The representations and warranties made pursuant to the
above-referenced Reset Remarketing Agreement (other than paragraphs (b)(viii),
(x), (xi) and (xii) of Section 7); Section 3(o) of the attached Purchase
Agreement (which date shall be the date of the Reset Remarketing Agreement
Supplement and the relevant Reset Tender Date); Section 9 of the attached
Purchase Agreement (except that Section 9 is amended to allow termination of
this Agreement by the Agent if the Company's representations and warranties
therein are not accurate and correct); paragraphs (c) and (f) of Section 5 of
the attached Purchase Agreement; and Section 8 and the last paragraph of Section
5 of the attached Purchase Agreement are incorporated in their entirety into
this Agreement and made applicable to the obligations of the Reset Remarketing
Agent to the extent applicable to any remarketing of the Senior Notes, except as
explicitly amended hereby. The terms "Registration Statement" and "Prospectus"
shall be deemed to refer to each such document as amended to the date hereof and
the Reset Tender Date, and the term "Incorporated Documents" shall similarly be
deemed to include those filed and incorporated by reference through such dates.
If the Reset Remarketing Agent determines, based on advice of
counsel, that changes in applicable law, regulations or interpretations of the
Securities and Exchange Commission make it necessary or advisable to deliver a
current prospectus in connection with this Remarketing, the attached Purchase
Agreement shall apply in its entirety. All references in such Purchase Agreement
to (i) the "Agent" shall be deemed to refer to the Reset Remarketing Agent, (ii)
the "Securities" shall
23
be deemed to refer to the Senior Notes, (iii) the Purchase Agreement shall be
deemed to refer to the Reset Remarketing Agreement Supplement, and (iv) "Closing
Date" shall be deemed to refer to the Reset Tender Date. To the extent the
provisions of such Purchase Agreement refer to the "Prospectus" or the
"Registration Statement," such references shall be deemed to refer to any
Remarketing Memorandum or registration statement, if any, that the Company is
required to prepare or file pursuant to applicable law, regulations or
interpretations of the Securities and Exchange Commission in effect at the time
of such remarketing of the Senior Notes, including all documents incorporated by
reference therein. For the purposes of Section 7 of the attached Purchase
Agreement, the relative benefit received by the Company on the one hand and the
Reset Remarketing Agent on the other in connection with the remarketing of the
Senior Notes pursuant to this Agreement shall be deemed to be in the same
respective proportions as the aggregate public offering price of the Senior
Notes bears to the remarketing fee received by the Reset Remarketing Agent
pursuant to this Agreement.
All capitalized terms not otherwise defined in this Agreement
have the respective meanings assigned thereto in the Senior Notes, the form of
which is attached hereto.
Company: Michigan Consolidated Gas Company
000 Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Reset Remarketing Agent and Address: Xxxxxxx Xxxxx & Co.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
Xxxxxxx Xxxxx World Headquarters
World Financial Center
Xxxxx Xxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Title of Senior Notes: Extendable MandatOry Par Put Remarketed
Securities(sm) due June 30, 2038
Principal Amount of Senior Notes to be Purchased:
Title of Indenture: Indenture dated as of June 1, 1998,
as supplemented and amended, by and
between the Company and the Trustee
Trustee: Citibank, N.A.
Current Ratings: Xxxxx'x Investors Service Inc.: "A2"
Standard & Poor's Corporation: "A"
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24
Certain Terms of the Senior Notes:
Maturity: June 30, 2038
Spread Determination Date:
Duration/Mode Determination Date:
Tender Notice Date:
Interest Reset Dates:
Reset Tender Date:
New Interest Rate: As determined by application of the
provisions set forth in the attached
form of the Senior Notes on the LIBOR
Determination Date or the Fixed Rate
Determination Date, as applicable.
Spread:
Interest Payment Dates: June 30 and December 30.
Subsequent Spread Period:
Redemption Provisions: As set forth in the Prospectus under
the caption headed "Description of
the Notes--Redemption."
Beneficial Owner Tender Provisions: As set forth in the attached
Prospectus Supplement dated June 17,
1998. In the event that the Reset
Remarketing Agent fails to purchase
all Senior Notes validly tendered for
purchase on the Reset Tender Date,
then the Reset Remarketing Agent
shall promptly notify the Company and
the Trustee of such failure.
Shorter Subsequent Spread Period: In the event that (A) the Reset
Remarketing Agent fails to purchase
all Senior Notes validly tendered for
purchase on the Reset Tender Date for
any reason, and (B) the Company has
not given notice of redemption of all
of the Senior Notes then outstanding
in
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25
accordance with the provisions
described in the attached form of the
Senior Notes, then the Subsequent
Spread Period shall be a period of
one year, which Subsequent Spread
Period shall be deemed to have
commenced upon the Commencement Date
that coincides with the Reset Tender
Date.
Legal Opinion: If required to be delivered pursuant
to this Reset Remarketing Agreement
Supplement, the opinion to be
delivered pursuant to Section
5(b)(1)(v) of the attached Purchase
Agreement shall be delivered by
counsel satisfactory to the Reset
Remarketing Agent and shall be
modified to read as follows: "the
Senior Notes are in the form
contemplated by the Indenture and
have been duly and validly
authorized; a single global Note
registered in the name of CEDE & Co.,
a nominee of The Depository Trust
Company ("DTC"), has been duly
authenticated in accordance with the
provisions of the Indenture, paid for
and delivered to DTC, and constitutes
a legal, valid and binding obligation
of the Company. The Reset Remarketing
Agent will acquire a "securities
entitlement" (within the meaning of
Section 8-501 of the Uniform
Commercial Code as in effect in the
State of New York (the "UCC")) with
respect to any Senior Notes which a
prior owner causes DTC or a
securities intermediary to credit to
the Reset Remarketing Agent's
securities account. Assuming that the
Reset Remarketing Agent acquires such
security entitlement for value and
without notice of an adverse claim,
then pursuant to Section 8-502 of the
UCC an action based on an adverse
claim to the Senior Notes, whether
framed in conversion, replevin,
constructive trust, equitable lien or
other theory, may not be asserted
against the Reset Remarketing Agent,
or such other opinion as shall be
appropriate under the law then in
effect to the effect that no other
person may assert rights in the
Senior Notes against the Reset
Remarketing Agent.
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26
If required to be delivered pursuant
to this Reset Remarketing Purchase
Agreement, the opinion to be
delivered pursuant to Section 5(b)(3)
of the attached Purchase Agreement
may be delivered by any counsel
designated by the Reset Remarketing
Agent and reasonably acceptable to
the Company.
Form of Senior Notes: Global certificate registered in the
name of the nominee, which currently
is CEDE & Co., of the depository of
the Senior Notes, which is DTC. The
beneficial owners of the Senior Notes
("Beneficial Owners") are not
entitled to receive definitive
certificates representing their
Senior Notes, except under limited
circumstances. A Beneficial Owner's
ownership of a Note currently is
recorded on or through the records of
the brokerage firm or other entity
that is a participant in DTC and that
maintains such Beneficial Owner's
account.
Purchase Price: 100% of the principal amount of the
Senior Notes. Payable to DTC for the
Beneficial Owners of Tendered Senior
Notes.
Remarketing Fee: _____% of the principal amount of the
Senior Notes outstanding on each
Reset Tender Date.
Closing:
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27
The foregoing terms are hereby confirmed and agreed to as of this ___
day of __________, ____.
MICHIGAN CONSOLIDATED GAS COMPANY
By:
---------------------------------
Name:
Title:
XXXXXXX XXXXX & CO.
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
By:
--------------------------------
Name:
Title:
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