Exhibit 1.1
CENTERPOINT ENERGY, INC.
and
BANC OF AMERICA SECURITIES LLC
Dealer Manager Agreement
dated as of , 2005
Dealer Manager Agreement
BANC OF AMERICA SECURITIES LLC
0 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
1. The Exchange Offer. CenterPoint Energy, Inc., a Texas corporation (the
"Company") proposes to offer to exchange up to $575,000,000 aggregate principal
amount of its new 3.75% Convertible Senior Notes, Series B due 2023 (the
"Exchange Securities") for an equal principal amount of its outstanding 3.75%
Convertible Senior Notes due 2023 (the "Existing Securities"). The exchange
offer described above (the "Exchange Offer") will be made on the terms and
subject to the conditions set forth in the Preliminary Prospectus (as defined
below) and related Letters of Transmittal, attached as Schedules A and B hereto.
The Exchange Securities will be issued pursuant to an Indenture, dated as of May
19, 2003, between the Company and JPMorgan Chase Bank, National Association, as
trustee (the "Trustee"), as heretofore supplemented (the "Base Indenture") and
as further supplemented by a Supplemental Indenture No. 6 to the Indenture, to
be entered into on the completion of the Exchange Offer (the "Supplemental
Indenture", and together with the Base Indenture, the "Indenture").
2. Engagement as Dealer Manager. The Company hereby engages and appoints
you as the exclusive dealer manager (the "Dealer Manager") for the Exchange
Offer and authorizes you to act as such in connection with the Exchange Offer.
As Dealer Manager you agree, in accordance with your customary practice, to
perform in connection with the Exchange Offer those services as are customarily
performed by investment banking concerns in connection with similar offers,
including, without limitation, using all reasonable best efforts to solicit the
tender of Existing Securities pursuant to and in accordance with the terms and
conditions of the Exchange Offer. You shall act as an independent contractor in
connection with the Exchange Offer with duties solely to the Company and nothing
herein contained shall constitute you as an agent of the Company in connection
with the solicitation of such Existing Securities pursuant to and in accordance
with the terms and conditions of the Exchange Offer; provided, however, that the
Company hereby authorizes and designates the Dealer Manager, and/or one or more
registered brokers or dealers chosen by the Dealer Manager, to act as the
Company's agent in making the Exchange Offer to residents of any jurisdiction in
which such agent designation may be necessary to comply with applicable law.
Nothing in this Agreement shall constitute the Dealer Manager a partner or joint
venturer with the Company or any of its subsidiaries. On the basis of the
representations and warranties and agreements of the Company contained herein
and subject to and in accordance with the terms and conditions hereof and of the
Exchange Offer, the Dealer Manager hereby agrees to act in such capacity.
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3. Registration Statement, Prospectus and Offering Materials. (a) The
Company has prepared and filed with the Securities and Exchange Commission (the
"Commission"), under the Securities Act of 1933, as amended, and the rules and
regulations of the Commission promulgated thereunder (collectively, the
"Securities Act"), a registration statement on Form S-4 (Reg. No. 333-123182),
including the preliminary prospectus dated , 2005, (the "Preliminary
Prospectus"), covering the registration of the Exchange Securities, the shares
of common stock, par value $0.01 per share, of the Company (the "Common Stock")
and associated preferred stock purchase rights issuable upon conversion of the
Exchange Securities (the "Conversion Shares"). The term "Registration
Statement," as used in this Agreement, shall mean such registration statement,
including the exhibits thereto and any documents incorporated by reference
therein, in the form in which it became effective and, in the event of any
amendment or supplement thereto or the filing of any abbreviated registration
statement pursuant to Rule 462(b) of the Securities Act relating thereto after
the effective date of such registration statement, shall also mean (from and
after the effectiveness of such abbreviated registration statement) such
registration statement as so amended or supplemented, together with any such
abbreviated registration statement. The final prospectus included in the
Registration Statement (including any documents incorporated in the Prospectus
by reference) is herein called the "Prospectus." The terms "supplement" and
"amendment" or "supplemented" and "amended" as used herein with respect to the
Prospectus shall include all documents deemed to be incorporated by reference in
the Prospectus that are filed subsequent to the date of the Prospectus and prior
to the termination of the Exchange Offer by the Company with the Commission
pursuant to the Securities Exchange Act of 1934, as amended, and the rules and
regulations of the Commission promulgated thereunder (the "Exchange Act").
(b) The Company has prepared and filed, or agrees that prior to or on the
date of commencement of the Exchange Offer (the "Commencement Date") it will
file, with the Commission under the Exchange Act a Tender Offer Statement on
Schedule TO with respect to the Exchange Offer, including the required exhibits
thereto and any documents incorporated by reference therein. The term "Schedule
TO" as used in this Agreement shall mean such Tender Offer Statement on Schedule
TO, including any amendment or supplement thereto.
(c) The Registration Statement, the Prospectus, Schedule TO, the related
letters from the Dealer Manager to securities brokers, dealers, commercial
banks, trust companies and other nominees approved by the Company, letters for
use by brokers to clients holding Existing Securities approved by the Company,
letters to beneficial owners of Existing Securities approved by the Company,
letters of transmittal, notices of guaranteed delivery and any newspaper
announcements, press releases and other offering materials and information the
Company may use or disseminate in connection with the Exchange Offer are herein
collectively referred to as the "Exchange Offer Materials."
4. Use of Exchange Offer Materials. (a) The Exchange Offer Materials have
been or will be prepared and approved by, and are the sole responsibility of,
the Company. The Company shall, to the extent permitted by law, use its
reasonable best efforts to disseminate the Exchange Offer Materials to each
registered holder of any Existing Securities, on or as soon as practicable after
the Commencement Date, pursuant to Rule 13e-4 so as to fulfill all requirements
thereof as to the commencement of the Exchange Offer not later than the date
hereof, under the Exchange Act and comply in all material respects with its
obligations
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thereunder. Thereafter, to the extent practicable until the date three days
prior to the expiration date of the Exchange Offer, the Company shall use its
reasonable best efforts to cause copies of such Exchange Offer Materials and a
return envelope to be mailed to each person who becomes a holder of record of
any Existing Securities prior to such date. The Company acknowledges and agrees
that you may use the Exchange Offer Materials as specified herein without
assuming any responsibility for independent verification on your part and the
Company represents and warrants to you that you may rely on the accuracy and
completeness of all of the Exchange Offer Materials and any other information
delivered to you by or on behalf of the Company without assuming any
responsibility for independent verification of such information or without
performing or receiving any appraisal or evaluation of the assets or liabilities
of the Company. The Dealer Manager agrees that it will not disseminate any
written materials for or in connection with the solicitation of holders of
Existing Securities other than the Exchange Offer Materials.
(b) The Company agrees to provide you with as many copies as you may
reasonably request of the Exchange Offer Materials. The Company agrees that
within a reasonable time prior to using or filing with any federal, state or
other governmental or regulatory agency or instrumentality (an "Other Agency")
of any Exchange Offer Materials, it will submit copies of such materials to you
and your counsel and will give reasonable consideration to you and your
counsel's comments, if any, thereon. The Company agrees that prior to the
termination of the Exchange Offer, before amending or supplementing the
Registration Statement, or the Prospectus, it will furnish copies of drafts to,
and consult with, the Dealer Manager and its counsel within a reasonable time in
advance of filing with the Commission of any amendment or supplement to the
Registration Statement, the Prospectus or the other Exchange Offer Materials.
(c) The Company has furnished or shall use its reasonable best efforts to
furnish to you, or cause the Trustee to furnish to you, as soon as practicable
after the date hereof (to the extent not previously furnished), cards or lists
in reasonable quantities or copies thereof showing the names of persons who were
the holders of record of the Existing Securities as of a recent date, together
with their addresses and the number of Existing Securities held by them. The
Company has furnished or shall use its reasonable best efforts to furnish to
you, or cause the Information Agent (as defined below) to furnish to you, as
soon as practicable after the date hereof (to the extent not previously
furnished), cards or lists in reasonable quantities or copies thereof showing
the names of persons who were the beneficial owners of the Existing Securities
as of a recent date, together with their addresses and the number of Existing
Securities held by them. Additionally, the Company shall update, or cause the
Trustee or Information Agent, as applicable, to update, such information from
time to time during the term of this Agreement as may be reasonably requested by
you. You agree to use such information only in connection with the Exchange
Offer and not to furnish such information to any other person except in
connection with the Exchange Offer, unless, based on the advice of your counsel,
disclosure is required by law, regulation, supervisory authority or other
applicable judicial or governmental order, in which case you will, to the extent
practicable, (1) promptly notify the Company in writing of such request or
demand and the information requested or demanded; (2) cooperate with the Company
in contesting, at the Company's expense, such demand or request; and (3) use
reasonable best efforts to obtain, at the Company's expense, protective orders
or similar restraints with respect to such information.
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(d) The Company authorizes the Dealer Manager to use the Exchange Offer
Materials in connection with the Exchange Offer and for such period of time as
any such materials are required by law to be delivered in connection therewith.
The Dealer Manager shall not have any obligation to cause any Exchange Offer
Materials to be transmitted generally to the holders of Existing Securities.
(e) The Company authorizes the Dealer Manager to communicate with any
information agent (the "Information Agent") or exchange agent (the "Exchange
Agent") appointed by the Company to act in such capacity in connection with the
Exchange Offer. The Company will arrange for the Exchange Agent to advise you as
to such matters relating to the Exchange Offer as you may reasonably request.
(f) The Company agrees that any reference to the Dealer Manager in any
Exchange Offer Materials or in any newspaper announcement or press release or
other document or communication is subject to the Dealer Manager's prior
consent, which consent shall not be unreasonably withheld.
5. Withdrawal. In the event that the Company (i) uses or permits the use
of, or files with the Commission or any Other Agency, any amendment or
supplement to the Registration Statement and any such document (a) has not been
previously submitted to you for your and your counsel's comments or (b) has been
so submitted, and you or your counsel have made reasonable comments which have
not been reflected in a manner reasonably satisfactory to you or your counsel;
or (ii) shall have breached, in any material respect, any of its
representations, warranties, agreements or covenants herein; or (iii) amends or
revises the Exchange Offer in a manner not reasonably acceptable to you and, in
the reasonable judgment of the Dealer Manager, any such event compromises its
position and ability to perform its role as Dealer Manager or its ability to
comply with the Securities Act or the Exchange Act; then you shall be entitled
upon written notice to the Company to withdraw as Dealer Manager in connection
with the Exchange Offer without any liability or penalty to you or any other
indemnified person (as defined in Section 11 below) and without loss of any
right to indemnification or contribution provided in Section 11 or to the
payment of all expenses payable pursuant to Sections 6 and 7 below which have
accrued through the date of such withdrawal.
6. Fees and Expenses of the Dealer Manager. The Company agrees to pay the
Dealer Manager, as compensation for its services hereunder, a fee equal to
$0.7826 per $1,000 principal amount of Exchange Securities accepted by the
Company pursuant to the Exchange Offer; provided, however, that any Exchange
Securities tendered by the Dealer Manager from its own accounts shall not be
included in calculating the fee to be paid to the Dealer Manager. The foregoing
fee shall be paid promptly after the acceptance of Exchange Securities in
immediately available funds to such account as the Dealer Manager may specify by
notice to the Company. The Company agrees to reimburse the reasonable
out-of-pocket expenses of the Dealer Manager incurred in connection with the
Exchange Offer (including, without limitation, the reasonable out-of-pocket
legal fees and expenses of the Dealer Manager's counsel in connection with the
Exchange Offer). At the Closing Date, the Dealer Manager shall provide the
Company a certificate setting forth the aggregate principal amount of Exchange
Securities, if any, tendered by the Dealer Manager from its own accounts.
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7. Other Expenses and Reimbursement of Expenses. The Company agrees to pay
all costs, fees and expenses incurred in connection with the performance of its
obligations hereunder and in connection with the transactions contemplated
hereby, including without limitation (i) all expenses incident to the
preparation, issuance, execution and delivery of the Exchange Securities, (ii)
all advertising expenses related to the Exchange Offer and all fees and expenses
incurred in marketing the Exchange Offer, including but not limited to road show
presentations, if any, (iii) all fees and expenses of the Information Agent, the
Exchange Agent and the Trustee, (iv) all fees and expenses of the Company's
independent public or certified public accountants and other advisors, (v) all
fees, costs and expenses incurred in connection with the registration or
qualification of the Exchange Securities under the laws of such jurisdictions as
the Dealer Manager may reasonably designate (including, without limitation,
reasonable fees and reasonable disbursements of counsel for the Dealer Manager),
(vi) all costs and expenses incurred in connection with the preparation,
printing and filing under the Securities Act of the Registration Statement, the
Prospectus (including financial statements, exhibits and amendments and
supplements thereto), and, under the Exchange Act, of the Schedule TO, (vii) all
costs and expenses incurred in connection with the printing (including word
processing and duplication costs), shipping, distribution and delivery of all
Exchange Offer Materials, and (viii) all customary mailing and handling expenses
incurred by dealers and brokers (including yourself), commercial banks, trust
companies and nominees in forwarding the Exchange Offer Materials to their
customers.
8. Representations, Warranties and Certain Agreements of the Company. The
Company represents and warrants to you, and agrees with you, that as of the
Commencement Date and as of the date when the Exchange Offer is consummated (the
"Closing Date"):
(a) The Registration Statement has been filed with the Commission and has
been declared effective by the Commission. Such amendments to such Registration
Statement and Prospectus and such abbreviated registration statements pursuant
to Rule 462(b) of the Securities Act as may have been required by applicable law
prior to the date hereof have been similarly prepared and filed with the
Commission; and the Company will file such additional amendments to such
Registration Statement and Prospectus and such abbreviated registration
statements as may hereafter be required by applicable law. Copies of such
Registration Statement and Prospectus, including all amendments thereto and all
documents incorporated by reference therein, and of any abbreviated registration
statement pursuant to Rule 462(b) of the Securities Act have been or will be,
delivered or made available to you and your counsel. No stop order refusing or
suspending the effectiveness of the Registration Statement or preventing or
suspending the use of any Prospectus is in effect, and no proceedings for such
purpose have been instituted or are pending before or, to the Company's
knowledge, are threatened, by the Commission.
(b) The Schedule TO has been filed with the Commission; such amendments to
such Schedule TO as may have been required by applicable law prior to the date
hereof have been similarly prepared and filed with the Commission; and the
Company will file such additional amendments to such Schedule TO as may
hereafter be required by applicable law. Copies of such Schedule TO, including
all amendments thereto and all documents incorporated by reference therein have
been or, if filed after the Commencement Date, will be, delivered or made
available to you and your counsel.
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(c) (i) The Exchange Offer Materials, including the Registration
Statement, the Prospectus and the Schedule TO, comply and will continue to
comply, in all material respects, with the Securities Act, the Exchange Act and
the Trust Indenture Act of 1939, as amended, and the applicable rules and
regulations of the Commission thereunder (the "Trust Indenture Act"); (ii) the
Registration Statement, when it became effective, did not contain and as amended
or supplemented thereafter, if applicable, will not contain, any 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 not
misleading; and (iii) none of the Prospectus or other Exchange Offer Materials
contains, and, as amended or supplemented, if applicable, will contain, any
untrue statement of a material fact or omit to state a material fact necessary
in order to make the statements therein, in the light of the circumstances under
which they were made, not misleading; except that the representations and
warranties set forth in this paragraph 8(c) do not apply to statements or
omissions in the Exchange Offer Materials, including the Registration Statement
or the Prospectus, or, in each case, any amendment or supplement thereto, based
upon information relating to the Dealer Manager furnished to the Company in
writing by the Dealer Manager expressly for use therein as set forth in Section
11(b) herein.
(d) The documents incorporated by reference in the Registration Statement
or the Prospectus, at the time they were or hereafter are filed with the
Commission, conformed and will conform in all material respects to the
requirements of the Exchange Act, and, when read together with the other
information in the Registration Statement or the Prospectus, as the case may be,
at the time the Registration Statement became effective and at the Commencement
Date and the Closing Date, as the case may be, none of such documents included
or will include any untrue statement of a material fact or omitted or will omit
to state any material fact required to be stated therein or necessary in order
to make the 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.
(e) The Company has not distributed and will not distribute, prior to the
later of the Closing Date and the completion of the distribution of the Exchange
Securities in exchange for the Existing Securities pursuant to the Exchange
Offer, any offering material in connection with the Exchange Offer other than
the Exchange Offer Materials.
(f) The Company has been duly incorporated and is validly existing in good
standing under the laws of the State of Texas, with corporate power and
authority to own its properties and conduct its business as described in the
Prospectus.
(g) Each subsidiary of the Company has been duly formed and is validly
existing in good standing under the laws of the jurisdiction of its formation,
with power and authority (corporate and other) to own its properties and conduct
its business as described in the Prospectus; and each subsidiary of the Company
is duly qualified to do business as a foreign corporation, limited partnership
or limited liability company in good standing in all other jurisdictions in
which its ownership or lease of property or the conduct of its business requires
such qualification; all of the issued and outstanding ownership interests of
each subsidiary of the Company have been duly authorized and validly issued in
accordance with the organizational documents of such subsidiary; and the
ownership interests of each subsidiary owned by the Company, directly or through
subsidiaries, is owned free from liens, encumbrances and defects.
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(h) The Company's authorized equity capitalization is as set forth in the
Prospectus and the capital stock of the Company conforms to the description
thereof contained in the Prospectus; the outstanding shares of Common Stock have
been duly authorized and validly issued and are fully paid and nonassessable;
the shares of Common Stock initially issuable upon conversion of the Exchange
Securities have been duly authorized and reserved for issuance and, when
delivered upon conversion of the Exchange Securities against payment of the
conversion price and in accordance with the terms of the Indenture, will be
validly issued, fully paid and nonassessable; the holders of outstanding shares
of capital stock of the Company are not entitled to preemptive or other rights
under the Amended and Restated Articles of Incorporation or the Amended and
Restated Bylaws of the Company, each as amended to date, or the Texas Business
Corporation Act, as amended to date, to subscribe for the Exchange Securities or
the shares of Common Stock issuable upon conversion thereof; and, except (i) as
set forth in the Prospectus and (ii) for options, restricted stock and
performance shares granted pursuant to the CenterPoint Energy, Inc. Long-Term
Incentive Plan and the CenterPoint Energy, Inc. Stock Plan for Outside
Directors, no options, warrants or other rights to purchase, agreements or other
obligations to issue, or rights to convert any obligations into or exchange any
securities for, shares of capital stock of or ownership interests in the
Company, which were granted by the Company, are outstanding.
(i) The Company has all corporate power to enter into this Agreement. This
Agreement has been duly authorized, executed and delivered by the Company.
(j) The Exchange Securities and the Indenture have been duly authorized by
the Company; the Base Indenture has been duly executed and delivered by the
Company and, when the Supplemental Indenture has been duly executed and
delivered by the Company in accordance with its terms and assuming the valid
execution and delivery thereof by the Trustee, the Indenture will constitute,
and, in the case of the Exchange Securities, when executed and delivered by the
Company pursuant to the terms hereof, and duly authenticated and delivered by
the Trustee as provided in the Indenture, the Exchange Securities will, on the
Closing Date, constitute, valid and legally binding obligations of the Company,
enforceable in accordance with their respective terms, subject, as to
enforcement, to bankruptcy, insolvency, fraudulent transfer, reorganization and
other laws of general applicability relating to or affecting creditors' rights
and to general equity principles (regardless of whether such enforceability is
considered in a proceeding in equity or at law); the Exchange Securities when
executed and delivered by the Company, and duly authenticated and delivered by
the Trustee, will be entitled to the benefits of the Indenture and will be
convertible into Common Stock in accordance with their terms and the terms of
the Indenture; the Indenture has been qualified under the Trust Indenture Act.
The Exchange Securities and the Common Stock will conform to the descriptions
thereof in the Prospectus.
(k) The execution and delivery by the Company of, and the performance by
the Company of its obligations under, this Agreement, the Exchange Securities
and the Indenture (collectively, the "Transaction Documents"), and the
consummation by the Company of the Exchange Offer and the transactions herein
contemplated (a) will not conflict with or result in a breach or violation of
any of the terms or provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement or other agreement or instrument to
which the Company or any subsidiary is a party or by which the Company or any
subsidiary is bound or to
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which any of the property or assets of the Company or any subsidiary is subject,
which conflict, breach, violation, or default would individually, or in the
aggregate, have a material adverse effect on the financial condition, business
or results of operations of the Company and its subsidiaries taken as a whole
("Material Adverse Effect") and (b) will not result in any violation of the
provisions of the Certificate of Incorporation or By-laws or other
organizational documents of the Company, the charter, by-laws or other
organizational documents of any subsidiary of the Company or any existing
statute or any order, rule or regulation of any court or governmental agency or
body having jurisdiction over the Company's or any of its or its subsidiaries'
properties; and no consent, approval, authorization or order of, or filing or
registration with any such court or governmental agency or body under any such
statute, judgment, order, decree, rule or regulation is required for the
execution, delivery and performance by the Company of each Transaction Document
to which it is a party, the authentication and delivery of the Exchange
Securities and the issuance of the Common Stock issuable upon conversion
thereof, and the consummation of the transactions contemplated by the
Transaction Documents, except for such consents, approvals, authorizations,
filings, registrations or qualifications (A) which shall have been obtained or
made prior to the Closing Date, including without limitation the order dated
June 30, 2003 of the Commission under the Public Utility Holding Company Act of
1935, as amended (the "1935 Act"), (B) as may be required to be obtained or made
under applicable state securities laws or "blue sky" laws and (C) as may be
required under the Securities Act, the Exchange Act and the Trust Indenture Act.
(l) The Company and its subsidiaries possess certificates, authorities or
permits issued by appropriate governmental agencies or bodies necessary to
conduct the business now operated by them and have not received any notice of
proceedings relating to the revocation or modification of any such certificate,
authority or permit that, if determined adversely to the Company or any of its
subsidiaries, would individually or in the aggregate have a Material Adverse
Effect.
(m) The Company is not, and after giving effect to the consummation of the
Exchange Offer, will not be an "investment company" as such term is defined in
the Investment Company Act of 1940, as amended (the "Investment Company Act").
(n) Except as disclosed in the Prospectus, neither the Company nor any of
its subsidiaries is in violation of any statute, any rule, regulation, decision
or order of any governmental agency or body or any court, domestic or foreign,
relating to the use, disposal or release of hazardous or toxic substances or
relating to the protection or restoration of the environment or human exposure
to hazardous or toxic substances (collectively, "environmental laws"), owns or
operates any real property contaminated with any substance that is subject to
any environmental laws, is liable for any off-site disposal or contamination
pursuant to any environmental laws, or is subject to any claim relating to any
environmental laws, which violation, contamination, liability or claim would
individually or in the aggregate have a Material Adverse Effect; and the Company
is not aware of any pending investigation which has a reasonable possibility of
leading to such a claim.
(o) Except as disclosed in the Prospectus, there are no pending actions,
suits or proceedings against or affecting the Company, any of its subsidiaries
or any of their respective properties that, if determined adversely to the
Company or any of its subsidiaries, would
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individually or in the aggregate have a Material Adverse Effect, or would
materially and adversely affect the ability of the Company to perform its
obligations under the Indenture or this Agreement, or which are otherwise
material in the context of the consummation of the Exchange Offer or the
consummation of any of the transactions contemplated hereby or thereby; and no
such actions, suits or proceedings are threatened or, to the Company's
knowledge, contemplated.
(p) The financial statements included in or incorporated by reference in
the Prospectus present fairly the financial position of the Company and its
consolidated subsidiaries as of the dates shown and their results of operations
and cash flows for the periods shown, and, except as otherwise disclosed in the
Prospectus, such financial statements have been prepared in conformity with the
generally accepted accounting principles in the United States applied on a
consistent basis.
(q) Since the date of the latest audited financial statements included in
or incorporated by reference in the Prospectus and except as disclosed in the
Prospectus there has been no material adverse change in the business, financial
condition, prospects or results of operations of the Company and its
subsidiaries taken as a whole, and there has been no dividend or distribution of
any kind declared, paid or made by the Company on any class of its membership
interests (other than regular quarterly dividends on the Common Stock and other
dividends described in the Prospectus).
(r) All written communications, in addition to the Schedule TO, made
during the period from the first public announcement and to the earlier of
either the expiration date or the Closing Date of the Exchange Offer have been
or will be filed with the Commission in accordance with the Exchange Act and the
Commission's rules and regulations including Rule 13e-4 under the Exchange Act.
9. Conditions to Dealer Manager's Obligations. The obligations of the
Dealer Manager hereunder are subject, as of the Commencement Date and the
Closing Date, to the accuracy of the representations and warranties on the part
of the Company herein, to the accuracy of the statements of officers of the
Company made pursuant to the provisions hereof, to the performance by the
Company of its obligations hereunder and to the following additional conditions:
(a) For the period from and after the date of this Agreement and prior to
the Closing Date:
(i) the Company shall have filed the Registration Statement with the
Commission and the Registration Statement shall have become effective;
(ii) no stop order refusing or suspending the effectiveness of the
Registration Statement or any post-effective amendment shall have been
issued or be in effect and no proceedings for such purpose shall have been
instituted or, to the Company's knowledge, threatened by the Commission
and any request for additional material information shall have been
complied with to the reasonable satisfaction of the Dealer Manager's
counsel; and
(iii) there shall not have occurred (a) any change in the business,
financial condition, prospects or results of operations of the Company and
its subsidiaries taken as one enterprise which, in the reasonable judgment
of the Dealer Manager, is material and
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adverse and makes it impractical to proceed with completion of the
Exchange Offer on the terms set forth herein; (b) any downgrading in the
rating of any debt securities of the Company by any "nationally recognized
statistical rating organization" (as defined for purposes of Rule 436(g)
under the Securities Act), or any public announcement that any such
organization has newly placed under surveillance or review its rating of
any debt securities of the Company (other than an announcement with
positive implications of a possible upgrading, and no implication of a
possible downgrading, of such rating); (c) any material suspension or
material limitation of trading in securities generally on the New York
Stock Exchange, or on the over-the-counter market or any suspension of
trading of any securities of CenterPoint Energy, Inc. on any exchange or
in the over-the-counter market; (d) any general moratorium on commercial
banking activities declared by U.S. Federal or New York State authorities;
(e) any major disruption of settlements of securities or clearance
services in the United States or (f) any act of terrorism in the United
States, any attack on, outbreak or escalation of hostilities involving the
United States, any declaration of war by Congress or any other national or
international calamity or crisis if, in the judgment of the Dealer
Manager, the effect of any such attack, outbreak, escalation, act,
declaration, calamity or crisis on the financial markets makes it
impractical to proceed with the consummation of the Exchange Offer on the
terms set forth herein.
(b) On each of the Commencement Date and the Closing Date, you shall have
received a written certificate, dated such date and executed by the President or
any Vice-President and a principal financial or accounting officer of the
Company in which such officers, to the best of their knowledge after reasonable
investigation, shall state that the representations and warranties of the
Company in this Agreement are true and correct, that the Company has complied
with all agreements and satisfied all conditions on its part to be performed or
satisfied hereunder at or prior to the Commencement Date or the Closing Date, as
the case may be, and that, subsequent to the date of the most recent financial
statements in the Prospectus, there has been no material adverse change in the
business, financial condition, prospects or results of operations of the Company
and its subsidiaries taken as a whole except as set forth in or contemplated by
the Prospectus or as described in such certificate.
(c) On the Commencement Date and the Closing Date, the Dealer Manager
shall have received the opinion of Xxxxx Xxxxxxx, Executive Vice President and
General Counsel of the Company, or Xxxxx X. Xxxxx, Esq., Vice President and
Deputy General Counsel of the Company, to the effect that:
(i) The Company has been duly incorporated and is validly existing
in good standing under the laws of the State of Texas and has corporate
power and authority to own its properties and conduct its business as
described in the Prospectus and to enter into and perform its obligations
under this Agreement and the Indenture and to consummate the Exchange
Offer;
(ii) Each Significant Subsidiary (as defined in Regulation S-X of
the Commission, "Significant Subsidiary") of the Company has been duly
formed and is validly existing in good standing under the laws of the
jurisdiction of its formation, with power and authority (corporate and
other) to own its properties and conduct its business as described in the
Prospectus; and each Significant Subsidiary of the Company is duly
11
qualified to do business as a foreign corporation, limited partnership or
limited liability company in good standing in all other jurisdictions in
which its ownership or lease of property or the conduct of its business
requires such qualification; all of the issued and outstanding ownership
interests of each Significant Subsidiary of the Company have been duly
authorized and validly issued in accordance with the organizational
documents of such Significant Subsidiary; and the ownership interests of
each subsidiary owned by the Company, directly or through subsidiaries is
owned free from liens, encumbrances and defects;
(iii) The Company's authorized equity capitalization is as set forth
in the Prospectus and the capital stock of the Company conforms, as to
legal matters, in all material respects to the description thereof
contained in the Prospectus; the outstanding shares of Common Stock have
been duly authorized and validly issued and are fully paid and
nonassessable; the shares of Common Stock initially issuable upon
conversion of the Exchange Securities have been duly authorized and
reserved for issuance and, when delivered upon conversion of the Exchange
Securities in accordance with the terms of the Indenture, will be validly
issued, fully paid and nonassessable; the holders of the outstanding
shares of capital stock of the Company are not entitled to any preemptive
or other rights under the Amended and Restated Articles of Incorporation
or the Amended and Restated Bylaws of the Company, each as amended to
date, or the Texas Business Corporation Act, as amended to date, to
subscribe for the Exchange Securities or the shares of Common Stock
issuable upon conversion thereof; and, except (i) as set forth in the
Prospectus and (ii) for options, restricted stock and performance shares
granted pursuant to the CenterPoint Energy, Inc. Long-Term Incentive Plan
and the CenterPoint Energy, Inc. Stock Plan for Outside Directors, no
options, warrants or other rights to purchase, agreements or other
obligations to issue, or rights to convert any obligations into or
exchange any securities for, shares of capital stock of or ownership
interests in the Company, which were granted by the Company, are
outstanding;
(iv) No consent, approval, authorization or other order of, or
registration with, any governmental regulatory body (other than (a) such
as may be required under applicable state securities laws, as to which
such counsel need not express an opinion, (b) such as may be required
pursuant to the Securities Act, the Exchange Act and the Trust Indenture
Act and (c) the order of the Commission under the 1935 Act, which has been
obtained and is in full force and effect) is required for the Exchange
Offer or for the issuance of the Common Stock upon conversion of the Notes
or for the consummation by the Company of the transactions contemplated by
this Agreement and the Indenture;
(v) To such counsel's knowledge and other than as set forth or
contemplated in the Prospectus, there are no legal or governmental
proceedings pending or threatened to which the Company is subject, which,
individually or in the aggregate, have a reasonable possibility of having
a Material Adverse Effect;
(vi) The execution, delivery and performance by the Company of this
Agreement and the Indenture, the exchange of the Exchange Securities for
the Existing Securities in the Exchange Offer and the issuance of the
Common Stock upon conversion of the Exchange Securities, will not result
in the breach or violation of, or constitute a
12
default under, (a) the Amended and Restated Articles of Incorporation, the
Amended and Restated Bylaws of the Company, each as amended to date or
other organizational documents of the Company, each as amended to date,
(b) any indenture, mortgage, deed of trust or other agreement or
instrument for borrowed money to which the Company is a party or by which
it is bound or to which its property is subject or (c) any law, order,
rule or regulation of any court or governmental agency or body having
jurisdiction over the Company or its property, including without
limitation, the 1935 Act, in any manner which, in the case of clause (b),
individually or in the aggregate, would have a Material Adverse Effect;
and
(vii) The description of statutes and regulations set forth in Part
I of the Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 2004 under the captions "Business -- Regulation" and
"Business -- Environmental Matters", and those described elsewhere in the
Prospectus, fairly describe in all material respects the portions of the
statutes and regulations addressed thereby.
(d) On the Commencement Date (except with respect to paragraphs i, ii,
iii, iv) and the Closing Date, the Dealer Manager shall have received the
opinion of Xxxxx Xxxxx LLP, counsel for the Company, dated as of such date, to
the effect that:
(i) The statements set forth in the Prospectus under the captions
"Description of the New Notes" and "Description of Capital Stock"
accurately summarize in all material respects the terms of the Exchange
Securities and the Common Stock issuable upon conversion thereof;
(ii) The Exchange Securities conform and the Common Stock issuable
upon conversion thereof shall conform, as to legal matters, in all
material respects to the descriptions thereof contained in the Prospectus,
including, without limitation, the description under the caption
"Description of the New Notes" and "Description of Capital Stock";
(iii) The Indenture has been duly qualified under the Trust
Indenture Act; the execution and delivery of the Indenture have been duly
and validly authorized by all necessary corporate action on the part of
the Company; the Indenture has been duly and validly executed and
delivered by the Company; the Indenture constitutes a valid and binding
instrument enforceable against the Company in accordance with its terms,
(a) except as such enforceability is subject to the effect of (I) any
applicable bankruptcy, insolvency, reorganization, fraudulent conveyance,
moratorium or other law relating to or affecting creditors' rights
generally, (II) general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law) and
(III) implied covenants of good faith and fair dealing and (b) except that
such counsel shall express no opinion as to the enforceability of any
provision of the Indenture requiring the payment of liquidated damages;
(iv) The Exchange Securities have been duly and validly authorized
by all necessary corporate action on the part of the Company, and the
Exchange Securities in definitive form, bearing the facsimile signature of
the President or a Vice President, and a
13
facsimile of the seal of the Company thereon attested by the facsimile
signature of the Secretary or an Assistant Secretary (assuming that the
form of authentication certificate thereon has been signed by an
authorized officer of JPMorgan Chase Bank, National Association, as
Trustee, which fact we have not been asked to verify by an inspection of
the Exchange Securities), when duly executed, issued and authenticated in
accordance with the terms of the Indenture and exchanged for the Existing
Securities, will constitute legal, valid and binding obligations of the
Company enforceable against the Company in accordance with their terms and
will be entitled to the benefits afforded by the Indenture, except as such
enforceability and entitlement are subject to the effect of (I) any
applicable bankruptcy, insolvency, reorganization, fraudulent conveyance,
moratorium or other law relating to or affecting creditors' rights
generally, (II) general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law) and
(III) any implied covenants of good faith and fair dealings;
(v) The execution, delivery and performance by the Company of this
Agreement, the performance by the Company of its obligations hereunder,
and (in the case of the opinion provided at the Closing Date) the issuance
and delivery by the Company of the Exchange Securities pursuant to the
Exchange Offer and the consummation of the Exchange Offer, have been duly
authorized by all necessary corporate action on the part of the Company,
and this Agreement has been duly executed and delivered by the Company;
(vi) Each document incorporated by reference in the Prospectus, as
originally filed pursuant to the Exchange Act, when so filed complied as
to form in all material respects with the Exchange Act and the applicable
rules and regulations of the Commission thereunder. In this paragraph,
references to the documents incorporated by reference do not include
references to any of the following, as to which such counsel has not been
asked to comment, which the Prospectus contains or incorporates by
reference or omits: (a) the financial statements, including the notes and
schedules, if any thereto or the auditor's reports on the audited portions
thereof, (b) the other accounting, financial and statistical data, and (c)
the exhibits thereto;
(vii) The Company is not and, after giving effect to the Exchange
Offer, will not be an "investment company" as defined in the Investment
Company Act;
(viii) Although the discussion set forth in the Prospectus under the
heading "Material United States Federal Income Tax Consequences" does not
purport to discuss all possible United States Federal income tax
consequences of the purchase, ownership, and disposition of the Exchange
Securities, in such counsel's opinion, such discussion constitutes, in all
material respects, a fair and accurate summary of the United States
Federal income tax consequences of the Exchange Offer, the ownership of
the Exchange Securities and the disposition of Exchange Securities by the
holders addressed therein, based upon current law and subject to the
qualifications set forth therein;
(ix) The Registration Statement and the Prospectus (except for the
following which are contained or incorporated by reference in or omitted
from the Registration Statement and the Prospectus: (A) the financial
statements, including the notes and
14
schedules, if any thereto or the auditor's reports on the audited portions
thereof, (B) the other accounting, financial and statistical data, and (C)
the exhibits thereto, as to which we have not been asked to comment)
comply as to form in all material respects with the applicable
requirements of the Securities Act and the applicable rules and
regulations promulgated under the Securities Act;
(x) The Schedule TO (except for the following which are contained or
incorporated by reference in or omitted from the Schedule TO: (A) the
financial statements, including the notes and schedules, if any thereto or
the auditor's reports on the audited portions thereof, (B) the other
accounting, financial and statistical data, and (C) the exhibits thereto,
as to which we have not been asked to comment) complies as to form in all
material respects with the applicable requirements of Section 13(e) of the
Exchange Act and the applicable rules and regulations promulgated under
Section 13(e) of the Exchange Act.
In addition, such counsel shall state that such counsel have
participated in conferences with officers and other representatives of the
Company, representatives of the independent public accountants of the Company
and representatives of the Dealer Manager, at which contents of the Registration
Statement and related matters were discussed. Although such counsel have not
undertaken to determine independently, and do not assume any responsibility for,
the accuracy, completeness or fairness of statements contained in the
Registration Statement or any of the documents incorporated by reference in the
Registration Statement (except to the extent set forth in paragraphs (i) and
(ii) (in the case of the opinion provided at the Closing Date) and (viii)
above), such counsel advises the Dealer Manager that, on the basis of the
foregoing, no facts have come to the attention of such counsel that lead them to
believe (i) that the Registration Statement, at the time the Registration
Statement became effective, contained any untrue statement of a material fact or
omitted to state a material fact necessary to make the statements therein not
misleading or (ii) that the Prospectus and the Schedule TO, as of the
Commencement Date, or the Closing Date, as the case may be, contained or
contains any untrue statement of a material fact or omitted to state a material
fact necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading. In this paragraph, references to the
Registration Statement and the Prospectus and Schedule TO do not include
references to any of the following, as to which such counsel has not been asked
to comment, which the Registration Statement, Prospectus or Schedule TO contain
or incorporate by reference or omits: (a) the financial statements, including
the notes and schedules, if any thereto or the auditor's reports on the audited
portions thereof, (b) the other accounting, financial and statistical data, and
(c) the exhibits thereto.
(e) On the Closing Date, the Dealer Manager shall have received the
opinion of Xxxxx Xxxxxxxxxx LLP, counsel for the Dealer Manager, with respect to
such matters as the Dealer Manager may reasonably request, and such counsel
shall have received such papers and information as they may reasonably request
to enable them to pass upon such matters.
(f) On the Closing Date, the Dealer Manager shall have received a letter,
dated the Closing Date, from Deloitte & Touche LLP, independent auditors of the
Company, substantially in the form heretofore supplied and deemed satisfactory
by the Dealer Manager.
15
The Company will furnish the Dealer Manager with such conformed copies of
the opinions, certificates, letters and documents required herewith as the
Dealer Manager reasonably requests.
10. Covenants of the Company. The Company covenants and agrees with the
Dealer Manager:
(a) To use its reasonable best efforts to cause the Registration Statement
to remain effective, and any post-effective amendment thereof, to become
effective as soon as possible but no later than the expiration date of the
Exchange Offer; to use its reasonable best efforts to cause any abbreviated
registration statement pursuant to Rule 462(b) of the Securities Act as may be
required subsequent to the date the Registration Statement became effective to
become effective as promptly as possible; to promptly advise the Dealer Manager
in writing (i) of the receipt of any comments from the Commission relating to
the Exchange Offer, (ii) when any post-effective amendment to the Registration
Statement or any abbreviated Registration Statement shall have become effective,
or any supplement to the Prospectus or any amended Prospectus or any amended or
additional Exchange Offer Materials shall have been filed, (iii) of any request
by the Commission to amend the Registration Statement or amend or supplement the
Prospectus or the other Exchange Offer Materials or for additional information
relating to the Exchange Offer and (iv) of (A) the issuance by the Commission of
any stop order refusing or suspending the use of any of the Exchange Offer
Materials or any qualification of the Exchange Securities for offering or sale
in connection with the Exchange Offer in any jurisdiction, (B) the institution
or threatening by the Commission of any proceedings for any of such purposes,
(C) the occurrence of any event which would cause the Company to withdraw,
rescind, terminate or modify the Exchange Offer or would permit the Company to
exercise any right not to accept Exchange Securities tendered pursuant to the
Exchange Offer, or (D) the institution by the NYSE of any proceedings to remove,
suspend or terminate from listing or quotation the Common Stock from any
securities exchange upon which it is listed for trading or included or
designated for quotation, or the threatening or initiation by the NYSE of any
proceedings for any such purposes. The Company will use its reasonable efforts
to prevent the issuance of any such stop order, the issuance of any order
preventing or suspending such use and the suspension of any such qualification
and, if any such order is issued or qualification suspended, to obtain the
lifting of such order or suspension at the earliest practicable time.
(b) To comply with the Securities Act, the Exchange Act and the Trust
Indenture Act in connection with the Exchange Offer, the Exchange Offer
Materials and the transactions contemplated hereby and thereby, as applicable.
If, at any time when the Prospectus is required by the Securities Act or the
Exchange Act to be delivered in connection with the Exchange Offer, any event
shall occur or condition shall exist as a result of which it is necessary, in
the reasonable opinion of both counsel for the Dealer Manager and counsel for
the Company, to amend the Registration Statement or amend or supplement the
Prospectus or any other Exchange Offer Materials in order that the Prospectus or
such other Exchange Offer Materials will not include an untrue statement of a
material fact or omit to state a material fact necessary in order to make the
statements in the Prospectus or such other Exchange Offer Materials, in the
light of the circumstances under which they were made, not misleading or if, in
the reasonable opinion of both such counsel, it shall be necessary to amend the
Registration Statement or amend or supplement the Prospectus or any other
Exchange Offer Materials to comply with the
16
requirements of the Securities Act or Exchange Act, the Company will promptly
prepare, file with the Commission, subject to Section 4(b) hereof, and furnish,
at its own expense, to the Dealer Manager and to the dealers (whose names and
addresses will be furnished to the Company by the Dealer Manager) to which
Existing Securities may have been tendered for exchange, such amendment or
supplement as may be necessary to correct such untrue statement or omission or
to make the Registration Statement or the Prospectus or such other Exchange
Offer Materials comply with such requirements.
(c) During the period beginning on the date hereof and ending on such date
as in the opinion of counsel for the Dealer Manager the Prospectus is no longer
required by law to be delivered in connection with the Exchange Offer, the
Company will file all documents required to be filed with the Commission
pursuant to Section 13, 14 or 15 of the Exchange Act in the manner and within
the time periods required by the Exchange Act.
(d) To cooperate with the Dealer Manager and Dealer Manager's counsel to
qualify or register the Exchange Securities for sale under (or obtain exemptions
from the application of) the state securities or blue sky laws or Canadian
provincial Securities laws of those jurisdictions reasonably designated by the
Dealer Manager; to comply with such laws and continue such qualifications,
registrations and exemptions in effect so long as required for the consummation
of the Exchange Offer; and in each jurisdiction in which the Exchange Securities
have been so qualified, the Company will file such statements and reports as may
be required by the laws of such jurisdiction to continue such qualification in
effect for a period of not less than one year from the effective date of the
Registration Statement; provided that the Company shall not be required to
qualify as a foreign corporation or to take any action that would subject the
Company to general service of process in any such jurisdiction where it is not
presently qualified or where it would be subject to taxation as a foreign
corporation.
(e) To use its reasonable best efforts to advise or cause the Exchange
Agent to advise the Dealer Manager at 5:00 P.M., New York City time, or promptly
thereafter, daily, by telephone, facsimile transmission or electronic
transmission, with respect to Existing Securities tendered as follows: (i) the
aggregate amount of Existing Securities tendered and represented by certificates
physically held by the Exchange Agent or confirmations of receipt of book-entry
transfer of Exchange Securities on such day; and (ii) the amount of Existing
Securities withdrawn on such day.
11. Indemnification and Contribution.
(a) The Company agrees to indemnify and hold harmless the Dealer Manager,
and each person, if any, who controls the Dealer Manager within the meaning of
the Securities Act or the Exchange Act, against any losses, claims, damages,
liabilities or expenses (including the reasonable cost of investigating and
defending against any claims therefor and counsel fees incurred in connection
therewith as such expenses are incurred), joint or several, which may be based
upon either the Securities Act, or the Exchange Act, or any other statute or at
common law, (i) relating to the withdrawal, rescission or modification of or a
failure to make or consummate the Exchange Offer by the Company; or (ii)
relating to any act or failure to act or any alleged act or failure to act by
the Dealer Manager in connection with, or relating in any manner to, the
Exchange Securities or the Exchange Offer and which is included as part of or
17
referred to in any losses, claims, damages, liabilities or actions arising out
of or based upon any matter covered in (iii) below (provided that the Company
shall not be liable under this clause (ii) to the extent that a court of
competent jurisdiction shall have determined by a final judgment that such
losses, claims, damages, liabilities or actions resulted directly from any such
acts or failures to act undertaken or omitted to be taken by the Dealer Manager
through its bad faith, gross negligence or willful misconduct); or (iii) on the
ground or alleged ground that the Registration Statement, the Schedule TO, the
Prospectus or any Exchange Offer Materials (or any such document, as from time
to time amended, or deemed to be amended, supplemented or modified), includes or
allegedly includes an untrue statement of a material fact or omits to state a
material fact required to be stated therein or necessary in order to make the
statements therein not misleading, unless such statement or omission was made in
reliance upon, and in conformity with, written information furnished to the
Company by the Dealer Manager specifically for use in the preparation thereof;
provided, that in no case is the Company to be liable with respect to any claims
made against the Dealer Manager or any such controlling person unless the Dealer
Manager or such controlling person shall have notified the Company in writing
within a reasonable time after the summons or other first legal process giving
information of the nature of the claim shall have been served upon the Dealer
Manager or such controlling person, but failure to notify the Company of any
such claim shall not relieve it from any liability which it may have to the
Dealer Manager or such controlling person otherwise than on account of the
indemnity agreement contained in this paragraph.
The Company will be entitled to participate at its own expense in
the defense, or, if it so elects, to assume the defense of any suit brought to
enforce any such liability, but, if the Company elects to assume the defense,
such defense shall be conducted by counsel chosen by it. In the event that the
Company elects to assume the defense of any such suit and retains such counsel,
the Dealer Manager or controlling person or persons, defendant or defendants in
the suit, may retain additional counsel but shall bear the fees and expenses of
such counsel unless (i) the Company shall have specifically authorized the
retaining of such counsel or (ii) the parties to such suit include the Dealer
Manager or controlling person or persons and the Dealer Manager or controlling
person or persons have been advised by such counsel that one or more legal
defenses may be available to it or them which may not be available to the
Company, in which case the Company shall not be entitled to assume the defense
of such suit on behalf of the Dealer Manager or controlling person or persons,
notwithstanding its obligation to bear the reasonable fees and expenses of such
counsel, it being understood, however, that the Company shall not, in connection
with any one such suit or proceeding or separate but substantially similar or
related actions or proceedings in the same jurisdiction arising out of the same
general allegations or circumstances, be liable for the reasonable fees and
expenses of more than one separate firm of attorneys at any time for the Dealer
Manager and its controlling persons, which firm shall be designated in writing
by the Dealer Manager. The Company shall not be liable to indemnify any person
for any settlement of any such claim effected without the Company's prior
written consent. This indemnity agreement will be in addition to any liability
which the Company might otherwise have.
(b) The Dealer Manager agrees to indemnify and hold harmless the Company,
each of the Company's directors and each person, if any, who controls the
Company within the meaning of the Securities Act or the Exchange Act, against
any losses, claims, damages, liabilities or expenses (including the reasonable
cost of investigating and defending against any
18
claims therefor and counsel fees incurred in connection therewith as such
expenses are incurred), joint or several, which may be based upon the Securities
Act, the Exchange Act or any other statute or at common law, on the ground or
alleged ground that the Registration Statement, the Schedule TO, the Prospectus
or any Exchange Offer Materials (or any such document, as from time to time
amended, or deemed to be amended, supplemented or modified) includes or
allegedly includes an untrue statement of a material fact or omits to state a
material fact required to be stated therein or necessary in order to make the
statements therein not misleading, but only insofar as any such statement or
omission was made in reliance upon, and in conformity with, written information
furnished to the Company by the Dealer Manager specifically for use in the
preparation thereof; provided that in no case is the Dealer Manager to be liable
with respect to any claims made against the Company or any such director,
officer, trustee or controlling person unless the Company or any such director,
officer, trustee or controlling person shall have notified the Dealer Manager in
writing within a reasonable time after the summons or other first legal process
giving information of the nature of the claim shall have been served upon the
Company or any such director, officer, trustee or controlling person, but
failure to notify the Dealer Manager of any such claim shall not relieve it from
any liability which it may have to the Company or any such director, officer,
trustee or controlling person otherwise than on account of the indemnity
agreement contained in this paragraph.
The Dealer Manager will be entitled to participate at its own
expense in the defense, or, if it so elects, to assume the defense of any suit
brought to enforce any such liability, but, if the Dealer Manager elects to
assume the defense, such defense shall be conducted by counsel chosen by it. In
the event that the Dealer Manager elects to assume the defense of any such suit
and retain such counsel, the Company or such director, officer, trustee or
controlling person, defendant or defendants in the suit, may retain additional
counsel but shall bear the fees and expenses of such counsel unless (i) the
Dealer Manager shall have specifically authorized the retaining of such counsel
or (ii) the parties to such suit include the Company or any such director,
officer, trustee or controlling person and the Dealer Manager and the Company or
such director, officer, trustee or controlling person have been advised by such
counsel that one or more legal defenses may be available to it or them which may
not be available to the Dealer Manager, in which case the Dealer Manager shall
not be entitled to assume the defense of such suit on behalf of the Company or
such director, officer, trustee or controlling person, notwithstanding its
obligation to bear the reasonable fees and expenses of such counsel, it being
understood, however, that the Dealer Manager shall not, in connection with any
one such suit or proceeding or separate but substantially similar or related
actions or proceedings in the same jurisdiction arising out of the same general
allegations or circumstances, be liable for the reasonable fees and expenses of
more than one separate firm of attorneys at any time for all of the Company and
any such director, officer, trustee or controlling person, which firm shall be
designated in writing by the Company. The Dealer Manager shall not be liable to
indemnify any person for any settlement of any such claim effected without such
the Dealer Manager's prior written consent. This indemnity agreement will be in
addition to any liability which the Dealer Manager might otherwise have.
(c) (i) If the indemnification provided for in this Section 11 is
unavailable or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above, then each indemnifying party shall contribute to
the amount paid or payable by such indemnified party as a result of the losses,
claims, damages or liabilities referred to in subsection (a) or (b) above (i) in
19
such proportion as is appropriate to reflect the relative benefits received by
the Company on the one hand and the Dealer Manager on the other from the
Exchange Offer or (ii) if the allocation provided by clause (i) above 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 the Dealer Manager on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one hand
and the Dealer Manager on the other in connection with the Exchange Offer shall
be deemed to be in the same respective proportions as the maximum aggregate
principal amount of the Exchange Securities issuable pursuant to the Exchange
Offer bears to the maximum compensation payable to the Dealer Manager pursuant
to this Agreement. 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 or the Dealer Manager and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such untrue statement or omission. The amount paid by an indemnified
party as a result of the losses, claims, damages or liabilities referred to in
the first sentence of this subsection (c) shall be deemed to include any legal
or other fees or expenses reasonably incurred by such indemnified party in
connection with investigating or defending any action or claim which is the
subject of this subsection (c). Notwithstanding the provisions of this
subsection (c), the Dealer Manager shall not be required to contribute any
amount in excess of the compensation, if any, received by the Dealer Manager in
connection with the Exchange Offer pursuant to this Agreement.
(d) No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. For purposes
of this Section 11(d), each officer and employee of the Dealer Manager and each
person, if any, who controls the Dealer Manager within the meaning of the
Securities Act and the Exchange Act shall have the same rights to contribution
as the Dealer Manager, and each director of the Company, each officer of the
Company who signed the Registration Statement and the Schedule TO, and each
person, if any, who controls the Company within the meaning of the Securities
Act and the Exchange Act shall have the same rights to contribution as the
Company.
12. Termination of this Agreement. (a) This Agreement shall terminate upon
the earliest to occur of (i) the expiration date of the Exchange Offer, (ii) the
date on which the Dealer Manager shall give the Company notice that any of the
conditions specified in Section 9 has not been fulfilled as of any date such
condition is required to be fulfilled pursuant to Section 9, (iii) the date on
which the Company terminates or withdraws the Exchange Offer for any reason, or
(iv) the date of the withdrawal of the Dealer Manager pursuant to Section 5
hereof.
(b) Notwithstanding termination of this Agreement pursuant to
subsection (a) above, the obligations of the parties pursuant to Sections
6, 7 and 11 shall survive any termination of this Agreement.
13. Survival of Indemnities, Representations, Warranties, etc. The
respective indemnities, agreements, representations, warranties and other
statements of the Company and the Dealer Manager, as set forth in this Agreement
or made by or on behalf of them, respectively,
20
pursuant to this Agreement, shall remain in full force and effect, regardless of
any investigation (or any statement as to the results thereof) made by or on
behalf of the Dealer Manager or any controlling person of the Dealer Manager, or
the Company, or any officer or director or controlling person of the Company,
and shall survive the consummation of the Exchange Offer.
14. Notices. All statements, requests, notices and agreements hereunder
shall be in writing, and (i) if to the Dealer Manager shall be delivered or sent
by mail, telex or facsimile transmission to Banc of America Securities LLC, 0
Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attn: Xxxx Xxxxxxxxx, Esq.
(facsimile number: 212-583-8457); and (ii) if to the Company shall be delivered
or sent by mail, telex or facsimile transmission to the Company in care of
CenterPoint Energy, Inc.: 0000 Xxxxxxxxx Xxxxxx, Xxxxxxx, XX 00000, Attention:
Xxxxx Xxxxx, Esq. (facsimile number: 713-207-0490). Any such statements,
requests, notices or agreements shall take effect upon receipt thereof.
15. Successors. This Agreement shall inure to the benefit of and be
binding upon the Dealer Manager and the Company and their respective successors
and the directors, trustees, officers and controlling persons referred to in
Section 11 of this Agreement. Nothing expressed or mentioned in this Agreement
is intended or shall be construed to give any person other than the persons
mentioned in the preceding sentence any legal or equitable right, remedy or
claim under or in respect of this Agreement, or any provisions herein contained;
this Agreement and all conditions and provisions hereof being intended to be,
and being, for the sole and exclusive benefit of such persons and for the
benefit of no other person; except that the representations, warranties,
covenants, agreements and indemnities of the Company contained in this Agreement
shall also be for the benefit of the person or persons, if any, who control the
Dealer Manager within the meaning of the Securities Act or the Exchange Act, and
the representations, warranties, covenants, agreements and indemnities of the
Dealer Manager shall also be for the benefit of each director of the Company and
the person or persons, if any, who control the Company within the meaning of the
Securities Act.
16. Partial Unenforceability. The invalidity or unenforceability of any
Section, paragraph or provision of this Agreement shall not affect the validity
or enforceability of any other Section, paragraph or provision hereof.
17. Applicable Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. The Company hereby submits to
the non-exclusive jurisdiction of the Federal and state courts in the Borough of
Manhattan in The City of New York in any suit or proceeding arising out of or
relating to this Agreement or the transactions contemplated hereby.
18. 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. Delivery of an executed signature page of this
Agreement by facsimile or any other rapid transmission device designed to
produce a written record of the communication transmitted shall be as effective
as delivery of a manually executed counterpart thereof.
21
If the foregoing is in accordance with your understanding of our
agreement, kindly sign and return to the Company the enclosed copies hereof,
whereupon this instrument, along with all counterparts hereof, shall become a
binding agreement in accordance with its terms.
Very truly yours,
CENTERPOINT ENERGY, INC.
By: ___________________________
Name:
Title:
The foregoing Dealer Manager Agreement is hereby confirmed and accepted by
the Dealer Manager in New York, New York as of the date first above written.
Accepted and agreed as of the date
first above written:
BANC OF AMERICA SECURITIES LLC
By: __________________________
Name:
Title:
