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EXHIBIT 1(A)
$ _____________
CMS ENERGY CORPORATION
___% Senior Notes due ___
______________________________________________
Underwriting Agreement
__________, 1999
To the Representative named
in Schedule I hereto of the
Underwriters named in
Schedule II hereto
Dear Sirs:
CMS Energy Corporation, a Michigan corporation (the
"Company"), proposes, subject to the terms and conditions stated herein, to
issue and sell to the several Underwriters (as defined in Section 14 hereof)
certain debt securities, to be in the aggregate principal amount, to mature in
the year and to have the interest rate specified in Schedule III hereto (the
"Securities"), and hereby confirms its agreement with the Underwriters as set
forth herein. The Securities shall be issued pursuant to the Indenture dated as
of September 15, 1992, between the Company and NBD Bank, as Trustee (the
"Trustee"), as amended and supplemented and to be supplemented by various
supplemental indentures, including the ____ Supplemental Indenture dated as of
the Time of Purchase (as defined herein) relating to the Securities (such
Indenture as so amended and supplemented and to be supplemented, the
"Indenture"). The Underwriters have designated the Representative to execute
this Agreement on their behalf and to act for them in the manner provided in
this Agreement.
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The Company has prepared and filed with the Securities and
Exchange Commission (the "Commission"), in accordance with the provisions of
the Securities Act of 1933, as amended (the "Act"), a registration statement on
Form S-3 (Registration No. ______), including a prospectus relating to the
Securities and such registration statement has become effective under the Act.
The registration statement at the time such registration statement became
effective and as it may have been thereafter amended to the date of this
Agreement (including the documents then incorporated by reference therein) is
hereinafter referred to as the "Registration Statement." The prospectus forming
a part of the Registration Statement at the time the Registration Statement
became effective (including the documents then incorporated by reference
therein) is hereinafter referred to as the "Basic Prospectus," provided that in
the event that the Basic Prospectus shall have been amended, revised or
supplemented prior to the date of this Agreement, or if the Company shall have
supplemented the Basic Prospectus by filing any documents pursuant to Section 13
or 14 or 15 of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), after the time the Registration Statement became effective and prior to
the date of this Agreement, which documents are deemed to be incorporated in the
Basic Prospectus, the term "Basic Prospectus" shall also mean such prospectus as
so amended, revised or supplemented. The Basic Prospectus, as it shall be
revised or supplemented to reflect the final terms of the offering and sale of
the Securities by a prospectus supplement relating to the Securities, and in the
form to be filed with, or transmitted for filing to, the Commission pursuant to
Rule 424 under the Act, is hereinafter referred to as the "Prospectus." Any
reference herein to the terms "amend," "amendment" or "supplement" with respect
to the Registration Statement or the Prospectus shall be deemed to include only
amendments or supplements to the Registration Statement or Prospectus, as the
case may be, and documents incorporated by reference therein after the date of
this Agreement and prior to the termination of the offering of the Securities by
the Underwriters.
1. Purchase and Sale: Upon the basis of the representations and
warranties and on the terms and subject to the conditions herein set forth, the
Company agrees to sell to the respective Underwriters, severally and not
jointly, and the respective Underwriters, severally and not jointly, agree to
purchase from the Company, at the purchase price specified in Schedule III
hereto, the respective principal amounts of Securities set opposite their names
in Schedule II hereto.
The Company is advised by the Representative that the
Underwriters propose to make a public offering of their respective portions of
the Securities as soon as practicable, in their judgment, after this Agreement
has become effective.
2. Payment and Delivery: Payment for the Securities shall be made to
the Company or its order in Federal or other immediately available funds in New
York City (or such other
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place or places of payment as shall be agreed upon by the Company and the
Representative in writing), upon the delivery of the Securities at the offices
of Skadden, Arps, Slate, Xxxxxxx and Xxxx LLP ("Skadden, Arps"), at 000 Xxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (or such other place or places of delivery as
shall be agreed upon by the Company and the Representative) to the
Representative for the respective accounts of the Underwriters against receipt
therefor signed by the Representative on behalf of themselves and as agent for
the other Underwriters. Such payment and delivery shall be made at 10:00 A.M.,
New York time on _______, 1999 (or on such later business day as shall be agreed
upon by the Company and the Representative in writing), unless postponed in
accordance with the provisions of Section 10 hereof. The day and time at which
payment and delivery for the Securities are to be made is herein called the
"Time of Purchase."
Delivery of the Securities shall be made in definitive, fully
registered form in authorized denominations registered in such names as the
Representative may request in writing to the Company not later than two full
business days prior to the Time of Purchase, or if no such request is received,
in the names of the respective Underwriters for the respective principal amounts
of Securities set forth opposite the name of each Underwriter in Schedule II, in
denominations selected by the Company.
The Company agrees to make the Securities available for
inspection by the Underwriters at the offices of Skadden, Arps, at least 24
hours prior to the Time of Purchase, in definitive, fully registered form, and
as requested pursuant to the preceding paragraph.
3. Conditions of Underwriters' Obligations: The several
obligations of the Under writers hereunder are subject to the accuracy of the
warranties and representations on the part of the Company and to the following
other conditions:
(a) That all legal proceedings to be taken in connection with the
issue and sale of the Securities shall be reasonably
satisfactory in form and substance to Skadden, Arps, counsel
to the Underwriters.
(b) That, at the Time of Purchase, the Representative shall be
furnished with the following opinions, dated the day of the
Time of Purchase:
(i) Opinion of Xxxxxxx X. XxxXxxxxx, Esq., counsel to the
Company, sub stantially to the effect set forth in
Exhibit A to this Agreement; and
(ii) Opinion of Skadden, Arps, counsel to the
Underwriters, substantially to the effect set forth
in Exhibit B to this Agreement.
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(c) That on the date hereof and on the date of the Time of
Purchase, the Representative shall have received a letter
from Xxxxxx Xxxxxxxx LLP ("Xxxxxx Xxxxxxxx") in form and
substance satisfactory to the Representa tive, dated as of
such date, (i) confirming that they are independent public
accountants within the meaning of the Act and the applicable
published rules and regulations of the Commission thereunder,
(ii) stating that in their opinion the financial statements
examined by them and included or incorporated by reference in
the Registration Statement complied as to form in all
material respects with the applicable accounting requirements
of the Commission, including applicable published rules and
regulations of the Commission, and (iii) covering, as of a
date not more than five business days prior to the date of
such letter, such other matters as the Representative
reasonably request.
(d) That, between the date of the execution of this Agreement and
the Time of Purchase, no material and adverse change shall
have occurred in the business, properties or financial
condition of the Company which, in the judgment of the
Representative, after reasonable inquiries on the part of the
Representative, impairs the marketability of the Securities
(other than changes referred to in or contemplated by the
Registration Statement or Prospectus).
(e) That, prior to the Time of Purchase, no stop order suspending
the effectiveness of the Registration Statement shall have
been issued under the Act by the Commission or proceedings
therefor initiated or threatened.
(f) That, at the Time of Purchase, the Company shall have
delivered to the Representative a certificate of an executive
officer of the Company to the effect that, to the best of his
knowledge, information and belief there shall have been no
material adverse change in the business, properties or
financial condition of the Company from that set forth in the
Registration Statement or Prospectus (other than changes
referred to in or contemplated by the Registration Statement
or Prospectus).
(g) That the Company shall have performed such of its obligations
under this Agreement as are to be performed at or before the
Time of Purchase by the terms hereof.
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(h) That any additional documents or agreements reasonably
requested by the Representative or their counsel to permit
the Underwriters to perform their obligations or permit their
counsel to deliver opinions hereunder shall have been
provided to them.
(i) That between the date of the execution of this Agreement and
the day of the Time of Purchase there has been no downgrading
of the investment ratings of any of the Company's securities
by Standard & Poor's Corporation, Xxxxx'x Investors Service,
Inc. or Duff & Xxxxxx Credit Rating Co., and the Company
shall not have been placed on "credit watch" or "credit
review" with negative implications by any of such statistical
rating organizations if any of such occurrences shall, in
the reasonable judgment of the Representative, after
reasonable inquiries on the part of the Representative,
impair the marketability of the Securities.
(j) That any filing of the Prospectus and any supplements thereto
required pursuant to Rule 424 under the Act have been made in
compliance with Rule 424 in the time periods provided by Rule
424.
4. Conditions of the Company's Obligations: The obligations of
the Company hereunder are subject to the satisfaction of the condition set forth
in Section 3(e).
5. Certain Covenants of the Company: In further consideration of
the agreements of the Underwriters herein contained, the Company covenants as
follows:
(a) To use its best efforts to cause any post-effective amendments
to the Registration Statement to become effective as promptly
as possible. During the time when a Prospectus is required to
be delivered under the Act, the Company will comply so far as
it is able with all requirements imposed upon it by the Act
and the rules and regulations of the Commission to the extent
necessary to permit the continuance of sales of or dealings
in the Securities in accordance with the provisions hereof and
of the Prospectus.
(b) To deliver to the Representative a conformed copy of the
Registration Statement and any amendments thereto (including
all exhibits thereto) and full and complete sets of all
comments of the Commission or its staff and all responses
thereto with respect to the Registration Statement and any
amendments thereto, and to furnish to the Representative, for
each of the
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Underwriters, conformed copies of the Registration
Statement and any amendments thereto, without exhibits.
(c) As soon as the Company is advised thereof, the Company will
advise the Representative and confirm the advice in writing
of: (i) the effectiveness of any amendment to the Registration
Statement, (ii) any request made by the Commission for
amendments to the Registration Statement or Prospectus or for
additional information with respect thereto, (iii) the
suspension of qualification of the Securities for sale under
Blue Sky or state securities laws, and (iv) the entry of a
stop order suspending the effectiveness of the Registration
Statement or of the initiation or threat or any proceedings
for that purpose and, if such a stop order should be entered
by the Commission, to make every reasonable effort to obtain
the lifting or removal thereof.
(d) To deliver to the Underwriters, without charge, as soon as
practicable, and from time to time during such period of time
after the date of the Prospectus as they are required by law
to deliver a prospectus, as many copies of the Prospectus (as
supplemented or amended if the Company shall have made any
supplements or amendments thereto) as the Representative may
reasonably request; and in case any Underwriter is required to
deliver a prospectus after the expiration of nine months after
the date of the Prospectus, to furnish to the Representative,
upon request, at the expense of such Underwriter, a reasonable
quantity of a supplemental prospectus or of supplements to the
Prospectus complying with Section 10(a)(3) of the Act.
(e) For such period of time after the date of the Prospectus as
the Underwriters are required by law to deliver a prospectus
in respect of the Securities, if any event shall have occurred
as a result of which it is necessary to amend or supplement
the Prospectus in order to make the statements therein, in
light of the circumstances when the Prospectus is delivered to
a purchaser, not misleading, or if it becomes necessary to
amend or supplement the Prospectus to comply with law, to
forthwith prepare and file with the Commission an appropriate
amendment or supplement to the Prospectus and deliver to the
Underwriters, without charge, such number of copies thereof as
may be reasonably requested.
(f) To use its best efforts to qualify the Securities for offer
and sale under the securities or Blue Sky laws of such
jurisdictions as the Representative may
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designate and to pay (or cause to be paid), or reimburse (or
cause to be reimbursed) the Underwriters and their counsel
for, reasonable filing fees and expenses in connection
therewith (including the reasonable fees and disbursements of
counsel to the Underwriters and filing fees and expenses paid
and incurred prior to the date hereof), provided, however,
that the Company shall not be required to qualify to do
business as a foreign corporation or as a securities dealer
or to file a general consent to service of process or to file
annual reports or to comply with any other requirements
deemed by the Company to be unduly burdensome.
(g) To pay all expenses, fees and taxes (other than transfer taxes
on sales by the respective Underwriters) in connection with
the issuance and delivery of the Securities, except that the
Company shall be required to pay the fees and disbursements
(other than disbursements referred to in paragraph (f) of this
Section 5) of Skadden, Arps, counsel to the Underwriters, only
in the events provided in paragraph (h) of this Section 5, the
Underwriters hereby agreeing to pay such fees and
disbursements in any other event, and that except as provided
in Section (h), the Company shall not be responsible for any
out-of-pocket expenses of the Underwriters in connection with
their services hereunder.
(h) If the Underwriters shall not take up and pay for the
Securities due to the failure of the Company to comply with
any of the conditions specified in Section 3 hereof, or, if
this Agreement shall be terminated in accordance with the
provisions of Section 11 hereof prior to the Time of Purchase,
to pay the reasonable fees and disbursements of Skadden, Arps,
counsel to the Underwriters, and, if the Underwriters shall
not take up and pay for the Securities due to the failure of
the Company to comply with any of the conditions specified in
Section 3 hereof, to reimburse the Underwriters for their
reasonable out-of-pocket expenses, in an aggregate amount not
exceeding a total of $_____, incurred in connection with the
financing contemplated by this Agreement.
(i) Prior to the termination of the offering of the Securities, to
not file any amendment to the Registration Statement or
supplement to the Prospectus (including the Basic Prospectus)
unless the Company has furnished the Representative and
counsel to the Underwriters with a copy for their review and
comment a reasonable time prior to filing and has reasonably
considered any comments of the Representative, or any such
amendment
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or supplement to which such counsel shall reasonably
object on legal grounds in writing, after consultation with
the Representative.
(j) To furnish the Representative with copies of all documents
required to be filed with the Commission pursuant to Section
13, 14 or 15(d) of the Exchange Act subsequent to the time the
Registration Statement becomes effective and prior to the
termination of the offering of the Securities.
(k) So long as may be required by law for the distribution of the
Securities by the Underwriters or by any dealers that
participate in the distribution thereof, the Company will
comply with all requirements under the Exchange Act relating
to the timely filing with the Commission of its reports
pursuant to Section 13 of the Exchange Act and of its proxy
statements pursuant to Section 14 of the Exchange Act.
(l) To make generally available to the Company's security holders,
as soon as practicable, an "earning statement" (which need not
be audited by inde pendent public accountants) covering a
twelve-month period commencing after the effective date of the
Registration Statement and ending not later than 15 months
thereafter, which shall comply in all material respects with
and satisfy the provisions of Section 11(a) of the Act and
Rule 158 under the Act.
6. Representations and Warranties of the Company: The Company
represents and warrants to, and agrees with, each of the Underwriters that:
(a) The Registration Statement has become effective under the Act;
a true and correct copy of the Registration Statement in the
form in which it became effective has been delivered to each
of the Representative and to the Representative for each of
the Underwriters (except that copies delivered for the
Underwriters excluded exhibits to such Registration
Statement); any filing of the Prospectus and any supplements
thereto required pursuant to Rule 424(b) has been or will be
made in the manner required by Rule 424(b) and within the time
period required by Section 3(j) hereof; no stop order
suspending the effectiveness of the Registration Statement is
in effect, and no proceedings for such purposes are pending
before or, to the knowledge of the Company, threatened by the
Commission. On the effective date of the Registration
Statement, the Registration Statement and the Basic Prospectus
complied, or were deemed to have complied, and
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on its respective issue date, each preliminary prospectus
filed pursuant to Rule 424(b) complied, and the Basic
Prospectus complied, and on its issue date, the Prospectus
will comply, or will be deemed to comply, in all material
respects with the applicable provisions of the Act, the Trust
Indenture Act of 1939, as amended (the "Trust Indenture Act")
and the published rules and regulations of the Commission,
none of the Registration Statement on its effective date, the
Basic Prospectus on its issue date, or any other preliminary
prospectus, on its issue date, contained any 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 the Prospectus, as of
its issue date and, as amended or supplemented, if
applicable, as of the Time of Purchase, will not contain any
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 Company makes no warranty or
representation to any Underwriter with respect to any state
ments or omissions made therein in reliance upon and in
conformity with information furnished in writing to the
Company by, or through the Representative on behalf of, any
Underwriter expressly for use therein, or to any statements in
or omissions from that part of the Registration State ment
that shall constitute the Statement of Eligibility and
Qualification under the Trust Indenture Act of the Trustee
under the Indenture.
(b) The documents incorporated by reference in the Registration
Statement, any preliminary prospectus, the Basic Prospectus
and the Prospectus, when they were filed (or, if an amendment
with respect to any such document was filed, when such
amendment was filed) with the Commission, conformed in all
material respects to the requirements of the Exchange Act and
the rules and regulations of the Commission promulgated
thereunder, and any further documents so filed and
incorporated by reference will, when they are filed with the
Commission, conform in all material respects to the
requirements of the Exchange Act and the rules and regulations
of the Commission promulgated thereunder; none of such
documents, when it was filed (or, if an amendment with respect
to any such document was filed, when such amendment was
filed), contained an untrue statement of a material fact or
omitted to state a material fact required to be stated therein
or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading; and
no such further document, when it is filed, will contain an
untrue
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statement of a material fact or will omit to state a material
fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which
they are made, not misleading.
(c) 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.
(d) The Securities are in the form contemplated by the Indenture
and have been duly authorized by the Company. At the Time of
Purchase, the Securities will have been duly executed and
delivered by the Company and, when authenticated by the
Trustee in the manner provided for in the Indenture and
delivered against payment therefor as provided in this
Agreement, will constitute valid and binding obligations of
the Company, enforceable against the Company in accordance
with their terms, except to the extent that enforcement
thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting
creditors' rights generally or by general principles of
equity (regardless of whether enforcement is considered in a
proceeding at law or in equity). The Securities conform in all
material respects to the descriptions thereof in the
Prospectus. Each significant subsidiary (as defined in Rule
405 under the Act, and hereinafter called a "Significant
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, has all
requisite authority to own or lease its properties and conduct
its business as described in the Prospectus 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 and
its Subsidiaries, taken as a whole.
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(e) This Agreement has been duly authorized, executed and
delivered by the Company, and the Company has full corporate
power and authority to enter into this Agreement.
(f) The Indenture has been duly authorized by the Company. At the
Time of Purchase, the Indenture will have been duly executed
and delivered by the Company and will constitute a valid and
binding obligation of the Company, enforceable against the
Company in accordance with its terms, except to the extent
that enforcement thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws
affecting creditors' rights generally or by general principles
of equity (regardless of whether enforcement is considered in
a proceeding at law or in equity); the Indenture conforms in
all material respects to the description thereof in the
Prospectus; and the Indenture conforms to the requirements of
the Trust Indenture Act.
(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 and the
8.20% Trust Originated Preferred Securities of Consumers
Energy Financing II, 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 (ii) 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 Enter
prises 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 all necessary consents, authorizations,
approvals, orders, certificates and permits of and from, and
has made all declarations and filings with, all federal,
state, local and other governmental authorities, all
self-regulatory organizations and all courts and other
tribunals, to own, lease, license and use its properties and
assets and to conduct its business in the manner described in
the Prospectus, except to the extent
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that the failure to obtain or file would not have a material
adverse effect on the Company.
(i) An appropriate order has been entered by the Federal Energy
Regulatory Commission under the Federal Power Act authorizing
the issuance and sale of the Securities, and such order is in
full force and effect. No other order, license, consent,
authorization or approval of, or exemption by, or the giving
of notice to, or the registration with any federal, state,
municipal or other governmental department, commission, board,
bureau, agency or instrumentality, and no filing, recording,
publication or registration in any public office or any other
place, was or is now required to be obtained by the Company to
authorize its execution or delivery of, or the performance of
its obligations under, this Agreement or the Securities,
except such as have been obtained or may be required under
state securities or Blue Sky laws or as referred to in the
Basic Prospectus.
(j) None of the issuance and sale of the Securities, or the
execution or delivery by the Company of, or the performance
by the Company of its obligations under, this Agreement did
or will conflict with, result in a breach of any of the terms
or provisions of, or constitute a default or require the
consent of any party under the Company's Articles of
Incorporation or by-laws, any material agreement or
instrument to which it is a party, any existing applicable
law, rule or regulation or any judgment, order or decree of
any government, governmental instrumentality or court,
domestic or foreign, having jurisdiction over the Company or
any of its properties or assets, or did or will result in the
creation or imposition of any lien on the Company's properties
or assets.
(k) Except as disclosed in the Basic Prospectus, there is no
action, suit, proceeding, inquiry or investigation (at law or
in equity or otherwise) pending or, to the knowledge of the
Company, threatened against the Company, by any governmental
authority that (i) questions the validity, enforceability or
performance of this Agreement or the Securities or (ii) if
determined adversely, is likely to have a material adverse
effect on the business or financial condition of the Company,
or materially adversely affect the ability of the Company to
perform its obligations hereunder or the consummation of the
transactions contemplated by this Agreement.
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(l) There has not been any material and adverse change in the
business, properties or financial condition of the Company
from that set forth in the Registration Statement (other than
changes referred to in or contemplated by the Registration
Statement or the Basic Prospectus).
(m) Except as set forth in the Basic Prospectus, no event or
condition exists that constitutes, or with the giving of
notice or lapse of time or both would constitute, a default or
any breach or failure to perform by the Company in any
material respect under any indenture, mortgage, loan
agreement, lease or other material agreement or instrument to
which the Company is a party or by which it or any of its
properties may be bound.
7. Representation and Warranties of Underwriters: Each
Underwriter warrants and represents that the information, if any, furnished in
writing to the Company through the Representative expressly for use in the
Registration Statement and Prospectus is correct in all material respects as to
such Underwriter. Each Underwriter, in addition to other information furnished
to the Company for use in the Registration Statement and Prospectus, herewith
furnishes to the Company for use in the Registration Statement and Prospectus,
the information stated herein with regard to the public offering, if any, by
such Underwriter and represents and warrants that such information is correct in
all material respects as to such Underwriter.
8. Indemnification:
(a) The Company agrees, to the extent permitted by law, to
indemnify and hold harmless each of the Underwriters and each
person, if any, who controls any such Underwriter within the
meaning of Section 15 of the Act or Section 20 of the Exchange
Act, against any and all losses, claims, damages or
liabilities, joint or several, to which they or any of them
may become subject under the Act or otherwise, and to
reimburse the Under writers and such controlling person or
persons, if any, for any legal or other expenses incurred by
them in connection with defending any action, suit or
proceeding (including governmental investigations) as provided
in Section 8(c) hereof, insofar as such losses, claims,
damages, liabilities or actions, suits or proceedings
(including governmental investigations) arise out of or are
based upon any untrue statement or alleged untrue statement of
a material fact contained in the Registration Statement, any
preliminary prospectus as of its issue date (if used prior to
the date of the Basic Pro spectus), the Basic Prospectus (if
used prior to the date of the Prospectus), the Prospectus, or,
if the Prospectus shall be amended or supplemented, in
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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 5(e)
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, Basic 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 Representative on behalf of, any Underwriter expressly
for use therein or with any statements in or omissions from
that part of the Registration Statement that shall constitute
the Statement of Eligibility and Qualification under the Trust
Indenture Act of the Trustee under the Indenture, and except
that this indemnity shall not inure to the benefit of any
Underwriter (or any person controlling such Underwriter) on
account of any losses, claims, damages, liabilities or
actions, suits or proceedings arising from the sale of the
Securities to any person if a copy of the Prospectus, as the
same may then be supplemented or amended (excluding, however,
any document then incorporated or deemed incorporated therein
by reference), was not sent or given by or on behalf of such
Underwriter to such person (i) with or prior to the written
confirmation of sale involved or (ii) as soon as available
after such written confirmation, relating to an event
occurring prior to the payment for and delivery to such person
of the Securities involved in such sale, and the omission or
alleged omission or untrue statement or alleged untrue state
ment was corrected in the Prospectus as supplemented or
amended at such time.
The Company's indemnity agreement contained in this Section
8(a), and the covenants, representations and warranties of the
Company 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 Securities hereunder, and the indemnity
agreement contained in this Section 8 shall survive any
termination of this Agreement. The liabilities of the
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Company in this Section 8(a) are in addition to any other
liabilities of the Company under this Agreement or otherwise.
(b) Each Underwriter agrees, severally and not jointly, 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, each other
Underwriter and each person, if any, who controls the Company
or any such other Underwriter within the meaning of Section 15
of the Act or Section 20 of the Exchange Act, to the same
extent and upon the same terms as the indemnity agreement of
the Company set forth in Section 8(a) hereof, but only with
respect to alleged untrue statements or omissions made in the
Registration Statement, the Basic Prospectus 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 such Underwriter expressly for use
therein.
The indemnity agreement on the part of each Underwriter
contained in this Section 8(b) and the representations and warranties of such
Underwriter contained in this Agreement shall remain in full force and effect
regardless of any investigation made by or on behalf of the Company or any other
person, and shall survive the delivery of and payment for the Securities
hereunder, and the indemnity agreement contained in this Section 8(b) shall
survive any termination of this Agreement. The liabilities of each Underwriter
in Section 8(b) are in addition to any other liabilities of such Underwriter
under this Agreement or otherwise.
(c) If a claim is made or an action, suit or proceeding (including
governmental investigations) is commenced or threatened
against any person as to which indemnity may be sought under
Section 8(a) or 8(b), such person (the "Indemnified Person")
shall notify the person against whom such indemnity may be
sought (the "Indemnifying Person") promptly after any
assertion of such claim threatening to institute an action,
suit or proceeding or if such an action, suit or proceeding is
commenced against such Indemnified Person, promptly after such
Indemnified Person shall have been served with a summons or
other first legal process, giving information as to the nature
and basis of the claim. Failure to so notify the Indemnifying
Person shall not, however, relieve the Indemnifying Person
from any liability which it may have on account of the
indemnity under Section 8(a) or 8(b) if the Indemnifying
Person has not been prejudiced in any material respect by such
failure. Subject to the immediately succeeding sentence, the
Indemnifying Person shall assume the defense of any such
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litigation or proceeding, including the employment of counsel
and the payment of all expenses, with such counsel being
designated, subject to the immediately succeeding sentence, in
writing by the Representative in the case of parties
indemnified pursuant to Section 8(b) and by the Company in the
case of parties indemnified pursuant to Section 8(a). Any
Indemnified Person shall have the right to participate in such
litigation or proceeding and to retain its own counsel, but
the fees and expenses of such counsel shall be at the expense
of such Indemnified Person unless (i) the Indemnifying Person
and the Indemnified Person shall have mutually agreed to the
retention of such counsel or (ii) the named parties to any
such proceeding (including any impleaded parties) include (x)
the Indemnifying Person and (y) the Indemnified Person and, in
the written opinion of counsel to such Indemnified Person,
representation of both parties by the same counsel would be
inappropriate due to actual or likely conflicts of interest
between them, in either of which cases the reasonable fees and
expenses of counsel (including disbursements) for such
Indemnified Person shall be reimbursed by the Indemnifying
Person to the Indemnified Person. If there is a conflict as
described in clause (ii) above, and the Indemnified Persons
have participated in the litigation or proceeding utilizing
separate counsel whose fees and expenses have been reimbursed
by the Indemnifying Person and the Indemnified Persons, or any
of them, are found to be solely liable, such Indemnified
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 Representative and the Company agree that the
Indemnifying Person's obligations to pay such fees and
expenses shall be conditioned upon the following:
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(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 Representative 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 them selves and
counsel to the Indemnifying Person.
The Indemnifying Person shall not be liable for any settlement
of any litigation or proceeding effected without the written consent of the
Indemnifying Person, but if settled with such consent or if there be a final
judgment for the plaintiff, the Indemnifying Person agrees, subject to the
provisions of this Section 8, to indemnify the Indemnified Person from and
against any loss, damage, liability or expenses by reason of such settlement or
judgment. The Indemnifying Person shall not, without the prior written consent
of the Indemnified Persons, effect any settlement of any pending or threatened
litigation, proceeding or claim in respect of which indemnity has been properly
sought by the Indemnified Persons hereunder, unless such settlement includes an
unconditional release by the claimant of all Indemnified Persons from all
liability with respect to claims which are the subject matter of such
litigation, proceeding or claim.
9. Contribution: If the indemnification provided for in Section 8
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 8 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
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and the Indemnified Person on the other from the offering of the Securities. 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 investiga tions) in respect thereof), as
well as any other relevant equitable considerations. The relative benefits
received by the Company on the one hand and the Underwriters 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 Underwriters, in each case
as set forth in the table on the cover page of the Prospectus, bear to the
aggregate public offering price of the Securities. 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 Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 9 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 9. 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 9 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 8 have been complied with (in all
material respects) in respect of any separate counsel for such Indemnified
Person. Notwithstanding the provisions of this Section 9, no Underwriter shall
be required to contribute any amount greater than the excess of (i) the total
price at which the Securities underwritten by it and distributed to the public
were offered to the public over (ii) the amount of any damages which such
Underwriter 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
fraudu lent misrepresentation. The Underwriters' obligations in this Section 9
to contribute are several in proportion to their respective underwriting
obligations and not joint.
The agreement with respect to contribution contained in
Section 9 hereof shall remain in full force and effect regardless of any
investigation made by or on behalf of the
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Company or any Underwriter, and shall survive delivery of and payment for the
Securities hereunder and any termination of this Agreement.
10. Substitution of Underwriters: If any Underwriter under this
agreement shall fail or refuse (otherwise than for some reason sufficient to
justify in accordance with the terms hereof, the termination of its obligations
hereunder) to purchase the Securities which it had agreed to purchase on the
Time of Purchase, the Representative shall immediately notify the Company and
the Representative and the other Underwriters may, within 36 hours of the giving
of such notice, determine to purchase, or to procure one or more other members
of the National Association of Securities Dealers, Inc. ("NASD") (or, if not
members of the NASD, who are foreign banks, dealers or institutions not
registered under the Exchange Act and who agree in making sales to comply with
the NASD's Rules of Fair Practice), satisfactory to the Company, to purchase,
upon the terms herein set forth, the principal amount of Securities which the
defaulting Underwriter had agreed to purchase. If any non-defaulting Underwriter
or Underwriters shall determine to exercise such right, the Representative shall
give written notice to the Company of such determination within 36 hours after
the Company shall have received notice of any such default, and thereupon the
Time of Purchase shall be postponed for such period, not exceeding three
business days, as the Company shall determine. If in the event of such a
default, the Representative shall fail to give such notice, or shall within such
36-hour period give written notice to the Company that no other Underwriter or
Underwriters, or others, will exercise such right, then this Agreement may be
terminated by the Company, upon like notice given to the Representative within a
further period of 36 hours. If in such case the Company shall not elect to
terminate this Agreement, it shall have the right, irrespective of such default:
(a) to require such non-defaulting Underwriters to purchase and
pay for the respective principal amounts of Securities which
they had severally agreed to purchase hereunder, as herein
above provided, and, in addition, the principal amount of
Securities which the defaulting Underwriter shall have so
failed to purchase up to a principal amount thereof equal to
one-ninth (1/9) of the respective principal amounts of
Securities which such non-defaulting Underwriters have
otherwise agreed to purchase hereunder; and/or
(b) to procure one or more other members of the NASD (or, if not
members of the NASD, who are foreign banks, dealers or
institutions not registered under the Exchange Act and who
agree in making sales to comply with the NASD's Rules of Fair
Practice), to purchase, upon the terms herein set forth, the
principal amount of Securities which such defaulting Under
writer had agreed to purchase, or that portion thereof which
the remaining
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Underwriters shall not be obligated to purchase pursuant to
the foregoing clause (a).
In the event the Company shall exercise its rights under
clause (a) and/or (b) above, the Company shall give written notice thereof to
the Representative within such further period of 36 hours, and thereupon the
Time of Purchase shall be postponed for such period, not exceeding five business
days, as the Company shall determine. In the event the Company shall be entitled
to but shall not elect to exercise its rights under clause (a) and/or (b), the
Company shall be deemed to have elected to terminate this Agreement.
Any action taken by the Company under this Section 10 shall
not relieve any defaulting Underwriter from liability in respect of any default
of such Underwriter under this Agreement. Termination by the Company under this
Section 10 shall be without any liability on the part of the Company or any
non-defaulting Underwriter.
In the computation of any period of 36 hours referred to in
this Section 10, there shall be excluded a period of 24 hours in respect of each
Saturday, Sunday or legal holiday which would otherwise be included in such
period of time.
11. Termination of Agreement: This Agreement may be terminated at
any time prior to the Time of Purchase by the Representative, if, prior to such
time (i) trading generally in securities on the New York Stock Exchange shall
have been suspended by the Commission or the New York Stock Exchange, (ii)
trading of any securities of the Company shall have been suspended on any
exchange or over-the-counter market, (iii) a general moratorium on commercial
banking activities in New York shall have been declared by federal or New York
State authorities or (iv) there shall have occurred any outbreak or material
escalation of hostilities or any material adverse disruption in financial
markets or any other calamity or crisis, the effect of which on the financial
markets of the United States is such as to impair, in the Representative's
reasonable judgment, after having made due inquiry, the marketability of the
Securities.
If the Representative elect to terminate this Agreement, as
provided in this Section 11, the Representative will promptly notify the Company
and each other Underwriter by telephone or telecopy, confirmed by letter. If
this Agreement shall not be carried out by any Underwriter for any reason
permitted hereunder, or if the sale of the Securities to the Underwriters as
herein contemplated shall not be carried out because the Company is not able to
comply with the terms hereof, the Company shall not be under any obligation
under this Agreement and shall not be liable to any Underwriter or to any member
of any selling group for the loss of anticipated profits from the transactions
contemplated by this Agreement and the Underwriters
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shall be under no liability to the Company nor be under any liability under this
Agreement to one another.
Notwithstanding the foregoing, the provisions of Sections
5(f), 5(h), 8 and 9 shall survive any termination of this Agreement.
12. Notices: All notices hereunder shall, unless otherwise
expressly provided, be in writing and be delivered at or mailed to the following
addresses or be sent by telecopy as follows: if to the Underwriters or the
Representative, to the Representative at the address or number, as appropriate,
designated in Schedule I hereto, and, if to the Company, to CMS Energy Corpora
tion, Xxxxxxxx Xxxxx Xxxxx, Xxxxx 0000, 000 Xxxx Xxxxxx Xxxxx, Xxxxxxxx,
Xxxxxxxx 00000, attention: Xxxx X. Xxxxxx, Senior Vice President and Chief
Financial Officer.
13. Parties in Interest: The Agreement herein set forth has been
and is made solely for the benefit of the Underwriters, the Company (including
the directors thereof and such of the officers thereof as shall have signed the
Registration Statement), and the controlling persons, if any, referred to in
Section 8 hereof, and their respective successors, assigns, executors and
administrators, and, except as expressly otherwise provided in Section 10
hereof, no other person shall acquire or have any right under or by virtue of
this Agreement.
14. Definition of Certain Terms: The term "Underwriters," as used
herein, shall be deemed to mean the several persons, firms or corporations,
named in Schedule II hereto (including the Representative herein mentioned, if
so named), and the term "Representative," as used herein, shall be deemed to
mean the representative or Representative designated by, or in the manner
authorized by, the Underwriters in Schedule I hereto. All obligations of the
Underwriters hereunder are several and not joint. If there shall be only one
person, firm or corporation named in Schedule I and Schedule II hereto, the term
"Underwriters" and the term "Representative," as used herein, shall mean such
person, firm or corporation. If the firm or firms listed in Schedule I hereto
are the same as the firm or firms listed in Schedule II hereto, then the terms
"Underwriters" and "Representative," as used herein, shall each be deemed to
refer to such firm or firms. The term "successors" as used in this Agreement
shall not include any purchaser, as such purchaser, of any of the Securities
from any of the respective Underwriters.
15. Governing Law: This Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York.
16. Counterparts: This Agreement may be executed by any one or
more of the parties hereto in any number of counterparts, each of which shall be
deemed to be an original, but all such respective counterparts shall together
constitute one and the same instrument.
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If the foregoing is in accordance with your understanding,
please sign and return to us counterparts hereof, and upon the acceptance hereof
by you, this letter and such acceptance hereof shall constitute a binding
agreement between each of the Underwriters and the Company.
Very truly yours,
CMS ENERGY CORPORATION
By:_________________________________
Name:
Title:
Confirmed and accepted
as of the date first written above:
__________________________
By:_______________________
Name:
Title:
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Schedule I: Representative
____________________________
____________________________
____________________________
Attention:
Telecopy:
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Schedule II: Underwriters
_________________________
Principal Amount
of Securities
Underwriters to be Purchased
____________ _________________
_________________________ ..................................................... $ 000,000,000
_________________________ ..................................................... $ 00,000,000
_________________________ ..................................................... $ 00,000,000
_________________________ ..................................................... $ 00,000,000
-------------
Total........................$ 00,000,000
============
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Schedule III
Information Regarding the Securities
1. Aggregate Principal Amount: $000,000,000
2. Maturity Date: _____________, 2009
3. Interest Rate: ____%
4. Price to be paid to the Company: _____% of the principal amount
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