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EXHIBIT 4.1
SEMCO ENERGY, INC.
MEDIUM-TERM NOTES
DUE NINE MONTHS OR MORE FROM DATE OF ISSUE
DISTRIBUTION AGREEMENT
October 23,1998
XXXXXXX XXXXX & CO.
XXXXXXX XXXXX, XXXXXX, XXXXXX & XXXXX
INCORPORATED
World Financial Center
North Tower, 10th Floor
New York, New York 10281-1310
XXXXXX XXXXXXX & CO. INCORPORATED
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
X.X. XXXXXXX & SONS, INC.
Xxx Xxxxx Xxxxxxxxx Xxxxxx
Xx. Xxxxx, Xxxxxxxx 00000
XXXXXX X. XXXXX & Co., L.P.
00000 Xxxxxxxxxx Xxxx
Xx. Xxxxx, Xxxxxxxx 00000-3729
Dear Sirs:
SEMCO Energy, Inc., a Michigan corporation (the "Company"),
confirms its agreement with Xxxxxxx Xxxxx & Co., Xxxxxxx Lynch, Pierce, Xxxxxx &
Xxxxx Incorporated, Xxxxxx Xxxxxxx & Co. Incorporated, X.X. Xxxxxxx & Sons, Inc.
and Xxxxxx X. Xxxxx, & Co., L.P. (each, an "Agent", and collectively, the
"Agents") with respect to the issue and sale by the Company of its Medium-Term
Notes Due Nine Months or More From Date of Issue (the "Notes"). The Notes are to
be issued pursuant to an Indenture, dated as of October 23, 1998, as amended or
modified from time to time (the "Indenture"), between the Company and NBD Bank,
a Michigan banking corporation, as trustee (the "Trustee"). As of the date
hereof, the Company has authorized the issuance and sale of up to U.S.
$150,000,000 aggregate initial offering price of Notes to or through
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the Agents pursuant to the terms of this Agreement. It is understood, however,
that the Company may from time to time authorize the issuance of additional
Notes and that such additional Notes may be sold to or through the Agents
pursuant to the terms of this Agreement, all as though the issuance of such
Notes were authorized as of the date hereof.
This Agreement provides both for the sale of Notes by the
Company to one or more Agents as principal for resale to investors and other
purchasers and for the sale of Notes by the Company directly to investors (as
may from time to time be agreed to by the Company and the applicable Agent), in
which case the applicable Agent will act as an agent of the Company in
soliciting offers for the purchase of Notes.
The Company has filed with the Securities and Exchange
Commission (the "Commission") a registration statement on Form S-3 (No.
333-58715) for the registration of its common stock, trust preferred securities
and debt securities, including the Notes, under the Securities Act of 1933, as
amended (the "1933 Act"), and the offering thereof from time to time in
accordance with Rule 415 of the rules and regulations of the Commission under
the 1933 Act (the "1933 Act Regulations"). Such registration statement has been
declared effective by the Commission and the Indenture has been duly qualified
under the Trust Indenture Act of 1939, as amended (the "1939 Act"). Such
registration statement (as so amended, if applicable) is referred to herein as
the "Registration Statement"; and the prospectus and all applicable amendments
or supplements thereto (including the prospectus supplement and pricing
supplement relating to the offering of Notes), in the form first furnished to
the applicable Agent(s) for use in confirming sales of Notes, are collectively
referred to herein as the "Prospectus"; provided, however, that all references
to the "Registration Statement" and the "Prospectus" shall also be deemed to
include all documents incorporated therein by reference pursuant to the
Securities Exchange Act of 1934, as amended (the "1934 Act"), prior to any
acceptance by the Company of an offer for the purchase of Notes; provided,
further, that if the Company files a registration statement with the Commission
pursuant to Rule 462(b) of the 1933 Act Regulations (the "Rule 462(b)
Registration Statement"), then, after such filing, all references to the
"Registration Statement" shall also be deemed to include the Rule 462(b)
Registration Statement. A "preliminary prospectus" shall be deemed to refer to
any prospectus used before the Registration Statement became effective and any
prospectus furnished by the Company after the registration statement became
effective and before any acceptance by the Company of an offer for the purchase
of Notes which omitted information to be included upon pricing in a form of
prospectus filed with the Commission pursuant to Rule 424(b) of the 1933 Act
Regulations. For purposes of this Agreement, all references to the Registration
Statement, Prospectus or preliminary prospectus or to any amendment or
supplement thereto shall be deemed to include any copy filed with the Commission
pursuant to its Electronic Data Gathering, Analysis and Retrieval system
("XXXXX").
All references in this Agreement to financial statements and
schedules and other information which is "disclosed", "contained," "included" or
"stated" (or other references of like import) in the Registration Statement,
Prospectus or preliminary prospectus shall be deemed to include all such
financial statements and schedules and other information which is incorporated
by reference in the Registration Statement, Prospectus or preliminary
prospectus, as the case may be; and all references in this Agreement to
amendments or supplements to the Registration
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Statement, Prospectus or preliminary prospectus shall be deemed to include the
filing of any document under the 1934 Act which is incorporated by reference in
the Registration Statement, Prospectus or preliminary prospectus, as the case
may be.
SECTION 1. Appointment as Agent.
(a) Appointment. Subject to the terms and conditions stated
herein and subject to the reservation by the Company of the right to sell Notes
directly on its own behalf, the Company hereby agrees that Notes will be sold
exclusively to or through the Agents. The Company agrees that it will not
appoint any other agents to act on its behalf, or to assist it, in the placement
of the Notes.
(b) Sale of Notes. The Company shall not sell or approve the
solicitation of offers for the purchase of Notes in excess of the amount which
shall be authorized by the Company from time to time or in excess of the
aggregate initial offering price of Notes registered pursuant to the
Registration Statement. The Agents shall have no responsibility for maintaining
records with respect to the aggregate initial offering price of Notes sold, or
for otherwise monitoring the availability of Notes for sale, under the
Registration Statement.
(c) Purchases as Principal. The Agents shall not have any
obligation to purchase Notes from the Company as principal. However, absent an
agreement between an Agent and the Company that such Agent shall be acting
solely as an agent for the Company, such Agent shall be deemed to be acting as
principal in connection with any offering of Notes by the Company through such
Agent. Accordingly, the Agents, individually or in a syndicate, may agree from
time to time to purchase Notes from the Company as principal for resale to
investors and other purchasers determined by such Agents. Any purchase of Notes
from the Company by an Agent as principal shall be made in accordance with
Section 3(a) hereof.
(d) Solicitations as Agent. If agreed upon between an Agent
and the Company, such Agent, acting solely as an agent for the Company and not
as principal, will solicit offers for the purchase of Notes. Such Agent will
communicate to the Company, orally, each offer for the purchase of Notes
solicited by it on an agency basis other than those offers rejected by such
Agent. Such Agent shall have the right, in its discretion reasonably exercised,
to reject any offer for the purchase of Notes, in whole or in part, and any such
rejection shall not be deemed a breach of its agreement contained herein. The
Company may accept or reject any offer for the purchase of Notes, in whole or in
part. Such Agent shall make reasonable efforts to assist the Company in
obtaining performance by each purchaser whose offer for the purchase of Notes
has been solicited by it on an agency basis and accepted by the Company. Such
Agent shall not have any liability to the Company in the event that any such
purchase is not consummated for any reason. If the Company shall default on its
obligation to deliver Notes to a purchaser whose offer has been solicited by
such Agent on an agency basis and accepted by the Company, the Company shall (i)
hold such Agent harmless against any loss, claim or damage arising from or as a
result of such default by the Company and (ii) pay to such Agent any commission
to which it would otherwise be entitled absent such default.
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(e) Reliance. The Company and the Agents agree that any Notes
purchased from the Company by one or more Agents as principal shall be
purchased, and any Notes the placement of which an Agent arranges as an agent of
the Company shall be placed by such Agent, in reliance on the representations,
warranties, covenants and agreements of the Company contained herein and on the
terms and conditions and in the manner provided herein.
SECTION 2. Representations and Warranties.
(a) The Company represents and warrants to each Agent as of
the date hereof, as of the date of each acceptance by the Company of an offer
for the purchase of Notes (whether to such Agent as principal or through such
Agent as agent), as of the date of each delivery of Notes (whether to such Agent
as principal or through such Agent as agent) (the date of each such delivery to
such Agent as principal is referred to herein as a "Settlement Date"), and as of
any time that the Registration Statement or the Prospectus shall be amended or
supplemented (each of the times referenced above is referred to herein as a
"Representation Date"), as follows:
(i) Due Incorporation, Good Standing and Due Qualification
of the Company. The Company has been duly organized and is validly
existing as a corporation in good standing under the laws of the State
of Michigan with corporate power and authority to own, lease and
operate its properties and to conduct its business as described in the
Prospectus and to enter into this Agreement and consummate the
transactions contemplated in the Prospectus; the Company is duly
qualified as a foreign corporation to transact business and is in good
standing in each jurisdiction in which such qualification is required,
whether by reason of the ownership or leasing of property or the
conduct of business, except where the failure to so qualify or be in
good standing would not result in a material adverse change in the
condition, financial or otherwise, or in the earnings, business affairs
or business prospects of the Company and its subsidiaries considered as
one enterprise (a "Material Adverse Effect"); all of the issued and
outstanding shares of capital stock of the Company have been duly
authorized and are validly issued, fully paid and non-assessable; and
none of the outstanding shares of capital stock of the Company were
issued in violation of preemptive or other similar rights of any
securityholder of the Company.
(ii) Due Incorporation, Good Standing and Due
Qualification of Significant Subsidiaries. Each of SEMCO Energy
Services, Inc., SEMCO Energy Gas Company and SEMCO Energy Ventures,
Inc. (each, a "Significant Subsidiary") has been duly organized and is
validly existing as a corporation in good standing under the laws of
the jurisdiction of its incorporation, has corporate power and
authority to own, lease and operate its properties and conduct its
business as described in the Prospectus and is duly qualified as a
foreign corporation to transact business and is in good standing in
each jurisdiction in which such qualification is required, whether by
reason of the ownership or leasing of property or the conduct of
business, except where the failure to so qualify or be in good standing
would not result in a Material Adverse Effect; except as stated in the
Prospectus, all of the issued and outstanding shares of capital stock
of each Significant
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Subsidiary has been duly authorized and is validly issued, fully paid
and non-assessable and is owned by the Company, directly or through
subsidiaries, free and clear of any security interest, mortgage,
pledge, lien, encumbrance, claim or equity; and none of the outstanding
shares of capital stock of any Significant Subsidiary was issued in
violation of preemptive or other similar rights of any securityholder
of such Significant Subsidiary.
(iii) Registration Statement and Prospectus. The Company
meets the requirements for use of Form S-3 under the 1933 Act; the
Registration Statement (or any Rule 462(b) Registration Statement) has
become effective under the 1933 Act and no stop order suspending the
effectiveness of the Registration Statement (or any Rule 462(b)
Registration Statement) has been issued under the 1933 Act and no
proceedings for that purpose have been instituted or are pending or, to
the knowledge of the Company, are contemplated by the Commission, and
any request on the part of the Commission for additional information
has been complied with; the Indenture has been duly qualified under the
1939 Act; at the respective times that the Registration Statement
(including any Rule 462(b) Registration Statement) and any
post-effective amendment thereto (including the filing of the Company's
most recent Annual Report on Form 10-K with the Commission (the "Annual
Report on Form 10-K")) became effective and at each Representation
Date, the Registration Statement (including any Rule 462(b)
Registration Statement) and any amendments thereto complied and will
comply in all material respects with the requirements of the 1933 Act
and the 1933 Act Regulations and the 1939 Act and the rules and
regulations of the Commission under the 1939 Act (the "1939 Act
Regulations") and did not and will not contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading;
each preliminary prospectus and prospectus filed as part of the
Registration Statement as originally filed or as part of any amendment
thereto, or filed pursuant to Rule 424 under the 1933 Act, complied
when so filed in all material respects with the 1933 Act Regulations;
each preliminary prospectus and the Prospectus delivered to the
applicable Agent(s) for use in connection with the offering of Notes
are identical to any electronically transmitted copies thereof filed
with the Commission pursuant to XXXXX, except to the extent permitted
by Regulation S-T; and at the date hereof, at the date of the
Prospectus and each amendment or supplement thereto and at each
Representation Date, neither the Prospectus nor any amendment or
supplement thereto included or will include an untrue statement of a
material fact or omitted or will 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; provided,
however, that the representations and warranties in this subsection
shall not apply to statements in or omissions from the Registration
Statement or the Prospectus made in reliance upon and in conformity
with information furnished to the Company in writing by the Agents
expressly for use in the Registration Statement or the Prospectus.
(iv) Incorporated Documents. The documents incorporated or
deemed to be incorporated by reference in the Prospectus, at the time
they were or hereafter are filed with the Commission, complied and will
comply in all material respects with the requirements of the 1934 Act
and the rules and regulations of the Commission under the
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1934 Act (the "1934 Act Regulations") and, when read together with the
other information in the Prospectus, at the date hereof, at the date of
the Prospectus and at each Representation Date, did not and will not
include an 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.
(v) Independent Accountants. The accountants who certified
the financial statements and any supporting schedules thereto included
in the Registration Statement and the Prospectus are independent public
accountants as required by the 1933 Act and the 1933 Act Regulations.
(vi) Financial Statements. The consolidated financial
statements of the Company included in the Registration Statement and
the Prospectus, together with the related schedules and notes, present
fairly the consolidated financial position of the Company and its
consolidated subsidiaries at the dates indicated and the consolidated
statement of operations, stockholders' equity and cash flows of the
Company and its consolidated subsidiaries for the periods specified;
such financial statements have been prepared in conformity with
generally accepted accounting principles ("GAAP") applied on a
consistent basis throughout the periods involved, other than as noted
therein; the supporting schedules, if any, included in the Registration
Statement and the Prospectus present fairly in accordance with GAAP the
information required to be stated therein; the selected financial data
and the summary financial information included in the Registration
Statement and the Prospectus present fairly the information shown
therein and have been compiled on a basis consistent with that of the
audited financial statements included in the Registration Statement and
the Prospectus, subject to year end adjustments.
(vii) No Material Changes. Since the respective dates as
of which information is given in the Registration Statement and the
Prospectus, except as otherwise stated therein, (1) there has been no
event or occurrence that would result in a Material Adverse Effect and
(2) there have been no transactions entered into by the Company or any
of its subsidiaries, other than those in the ordinary course of
business, which are material with respect to the Company and its
subsidiaries considered as one enterprise.
(viii) Authorization, etc., of this Agreement, the
Indenture and the Notes. This Agreement has been duly authorized,
executed and delivered by the Company; the Indenture has been duly
authorized, executed and delivered by the Company and will be a valid
and legally binding agreement of the Company, enforceable against the
Company in accordance with its terms, except as enforcement thereof may
be limited by bankruptcy, insolvency, reorganization, moratorium or
other similar laws affecting the enforcement of creditors' rights
generally or by general equitable principles (regardless of whether
enforcement is considered in a proceeding in equity or at law); the
Notes have been duly authorized by the Company for offer, sale,
issuance and delivery pursuant to this Agreement and, when issued,
authenticated and delivered in the manner provided for in
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the Indenture and delivered against payment of the consideration
therefor, will constitute valid and legally binding obligations of the
Company, enforceable against the Company in accordance with their
terms, except as enforcement thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting
the enforcement of creditors' rights generally or by general equitable
principles (regardless of whether enforcement is considered in a
proceeding in equity or at law); the Notes will be substantially in a
form previously certified to the Agents and contemplated by the
Indenture; and each holder of Notes will be entitled to the benefits of
the Indenture.
(ix) Descriptions of the Indenture and the Notes. The
Indenture and the Notes conform and will conform in all material
respects to the statements relating thereto contained in the Prospectus
and are substantially in the form filed or incorporated by reference,
as the case may be, as an exhibit to the Registration Statement.
(x) Accuracy of Exhibits. There are no contracts or
documents which are required to be described in the Registration
Statement, the Prospectus or the documents incorporated by reference
therein or to be filed as exhibits thereto which have not been so
described and filed as required.
(xi) Absence of Defaults and Conflicts. Neither the
Company nor any of its subsidiaries is in violation of the provisions
of its charter or by-laws or in default in the performance or
observance of any obligation, agreement, covenant or condition
contained in any contract, indenture, mortgage, deed of trust, loan or
credit agreement, note, lease or other agreement or instrument to which
the Company or any of its subsidiaries is a party or by which it or any
of them may be bound or to which any of the property or assets of the
Company or any of its subsidiaries is subject (collectively,
"Agreements and Instruments"), except for such defaults that would not
result in a Material Adverse Effect; and the execution, delivery and
performance of this Agreement, the Indenture, the Notes and any other
agreement or instrument entered into or issued or to be entered into or
issued by the Company in connection with the transactions contemplated
by the Prospectus, the consummation of the transactions contemplated in
the Prospectus (including the issuance and sale of the Notes and the
use of proceeds therefrom as described in the Prospectus) and the
compliance by the Company with its obligations hereunder and under the
Indenture, the Notes and such other agreements or instruments have been
duly authorized by all necessary corporate action and do not and will
not, whether with or without the giving of notice or the passage of
time or both, conflict with or constitute a breach of, or default or
event or condition which gives the holder of any note, debenture or
other evidence of indebtedness (or any person acting on such holder's
behalf) the right to require the repurchase, redemption or repayment of
all or a portion of such indebtedness by the Company or any of its
subsidiaries (a "Repayment Event") under, or result in the creation or
imposition of any lien, charge or encumbrance upon any assets,
properties or operations of the Company or any of its subsidiaries
pursuant to, any Agreements and Instruments, nor will such action
result in any violation of the provisions of the charter or by-laws
of the Company or any
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of its subsidiaries or any applicable law, statute, rule, regulation,
judgment, order, writ or decree of any government, government
instrumentality or court, domestic or foreign, having jurisdiction over
the Company or any of its subsidiaries or any of their assets,
properties or operations.
(xii) Absence of Labor Disputes. No labor dispute with the
employees of the Company or any of its subsidiaries exists or, to the
knowledge of the Company, is imminent, which may reasonably be expected
to result in a Material Adverse Effect.
(xiii) Absence of Proceedings. There is no action, suit,
proceeding, inquiry or investigation before or brought by any court or
governmental agency or body, domestic or foreign, now pending, or to
the knowledge of the Company threatened, against or affecting the
Company or any of its subsidiaries which is required to be disclosed in
the Registration Statement and the Prospectus (other than as stated
therein), or which may reasonably be expected to result in a Material
Adverse Effect, or which may reasonably be expected to materially and
adversely affect the performance by the Company of its obligations
under this Agreement, the Indenture and the Notes or the consummation
of the transactions contemplated in the Prospectus; and the aggregate
of all pending legal or governmental proceedings to which the Company
or any of its subsidiaries is a party or of which any of their
respective assets or properties or operations is the subject which are
not described in the Registration Statement and the Prospectus,
including ordinary routine litigation incidental to the business, may
not reasonably be expected to result in a Material Adverse Effect.
(xiv) Possession of Intellectual Property. The Company and
its subsidiaries own or possess, or can acquire on reasonable terms,
adequate patents, patent rights, licenses, inventions, copyrights,
know-how (including trade secrets and other unpatented and/or
unpatentable proprietary or confidential information, systems or
procedures), trademarks, service marks, trade names or other
intellectual property (collectively, "Intellectual Property") necessary
to carry on the business now operated by them, and neither the Company
nor any of its subsidiaries has received any notice or is otherwise
aware of any infringement of or conflict with asserted rights of others
with respect to any Intellectual Property or of any facts or
circumstances which would render any Intellectual Property invalid or
inadequate to protect the interest of the Company or any of its
subsidiaries therein, and which infringement, conflict, invalidity or
inadequacy, singly or in the aggregate, if the subject of any
unfavorable decision, ruling or finding, would result in a Material
Adverse Effect.
(xv) Possession of Licenses and Permits. The Company and
its subsidiaries possess such permits, licenses, approvals, consents
and other authorizations (collectively, "Governmental Licenses") issued
by the appropriate federal, state, local or foreign regulatory agencies
or bodies necessary to conduct the business now operated by them,
except where the failure to possess such a Governmental License would
not, singly or in the aggregate, have a Material Adverse Effect; the
Company and its subsidiaries are in compliance with the terms and
conditions of all such Governmental Licenses, except
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where the failure so to comply would not, singly or in the aggregate,
result in a Material Adverse Effect; all of the Governmental Licenses
are valid and in full force and effect, except where the invalidity of
such Governmental Licenses or the failure of such Governmental Licenses
to be in full force and effect would not result in a Material Adverse
Effect; and neither the Company nor any of its subsidiaries has
received any notice of proceedings relating to the revocation or
modification of any such Governmental Licenses which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or
finding, would result in a Material Adverse Effect.
(xvi) Title to Property. The Company and its subsidiaries
have good and marketable title to all real property owned by the
Company and its subsidiaries and good title to all other properties
material to the business of the Company and its subsidiaries considered
as one enterprise, in each case, free and clear of all mortgages,
pledges, liens, security interests, claims, restrictions or
encumbrances of any kind, except (A) as otherwise stated in the
Registration Statement and the Prospectus or (B) those which do not,
singly or in the aggregate, materially affect the value of such
property and do not interfere with the use made and proposed to be made
of such property by the Company or any of its subsidiaries; and all of
the leases and subleases material to the business of the Company and
its subsidiaries considered as one enterprise, and under which the
Company or any of its subsidiaries holds properties described in the
Prospectus, are in full force and effect, and neither the Company nor
any of its subsidiaries has received any notice of any material claim
of any sort that has been asserted by anyone adverse to the rights of
the Company or any of its subsidiaries under any of such leases or
subleases, or affecting or questioning the rights of the Company or
such subsidiary of the continued possession of the leased or subleased
premises under any such lease or sublease.
(xvii) Environmental Laws. Except as otherwise stated in
the Registration Statement and the Prospectus and except as would not,
singly or in the aggregate, result in a Material Adverse Effect, (A)
neither the Company nor any of its subsidiaries is in violation of any
federal, state, local or foreign statute, law, rule, regulation,
ordinance, code, policy or rule of common law or any judicial or
administrative interpretation thereof including any judicial or
administrative order, consent, decree or judgment, relating to
pollution or protection of human health, the environment (including,
without limitation, ambient air, surface water, groundwater, land
surface or subsurface strata) or wildlife, including, without
limitation, laws and regulations relating to the release or threatened
release of chemicals, pollutants, contaminants, wastes, toxic
substances, hazardous substances, petroleum or petroleum products
(collectively, "Hazardous Materials") or to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport
or handling of Hazardous Materials (collectively, "Environmental
Laws"), (B) the Company and its subsidiaries have all permits,
authorizations and approvals required under any applicable
Environmental Laws and are each in compliance with their requirements,
(C) there are no pending or, to the Company's knowledge, threatened
administrative, regulatory or judicial actions, suits, demands, demand
letters, claims, liens, notices of noncompliance or violation,
investigation or proceedings relating to any Environmental Law against
the
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Company or any of its subsidiaries and (D) there are no events or
circumstances that may reasonably be expected to form the basis of an
order for clean-up or remediation, or an action, suit or proceeding by
any private party or governmental body or agency, against or affecting
the Company or any of its subsidiaries relating to Hazardous Materials
or any Environmental Laws.
(xviii) No Filings, Regulatory Approvals, etc. No filing
with, or approval, authorization, consent, license, registration,
qualification, order or decree of, any court or governmental authority
or agency, domestic or foreign, is necessary or required for the due
authorization, execution and delivery by the Company of this Agreement,
the Indenture and the Notes or for the performance by the Company of
the transactions contemplated in this Agreement, the Indenture or the
Prospectus, except such as have been previously made, obtained or
rendered, as applicable, or as may be required under the 1933 Act or
the 1933 Act Regulations or state securities laws.
(xix) Holding Company Act. The Company and the Company's
subsidiaries are not subject to regulation under the Public Utility
Holding Company Act of 1935, as amended (the "Holding Company Act"),
other than the provisions of Section 9(a)(2) thereof.
(xx) Ratings. The Medium-Term Note Program under which the
Notes are issued (the "Program"), as well as the Notes, are rated
(P)Baal by Xxxxx'x Investors Service, Inc. and BBB by Standard &
Poor's Ratings Services, or such other rating as to which the Company
shall have most recently notified the Agents pursuant to Section 4(a)
hereof.
(b) Additional Certifications. Any certificate signed by any
officer of the Company or any of its subsidiaries and delivered to one or more
Agents or to counsel for the Agents in connection with an offering of Notes to
one or more Agents as principal or through an Agent as agent shall be deemed a
representation and warranty by the Company to such Agent or Agents as to the
matters covered thereby on the date of such certificate and, unless subsequently
amended or supplemented, at each Representation Date subsequent thereto.
SECTION 3. Purchases as Principal; Solicitations as Agent.
(a) Purchases as Principal. Notes purchased from the Company
by the Agents, individually or in a syndicate, as principal shall be made in
accordance with terms agreed upon between such Agent or Agents and the Company
(which terms, unless otherwise agreed, shall, to the extent applicable, include
those terms specified in Exhibit A hereto and shall be agreed upon orally, with
written confirmation prepared by such Agent or Agents and mailed to the
Company). An Agent's commitment to purchase Notes as principal shall be deemed
to have been made on the basis of the representations and warranties of the
Company herein contained and shall be subject to the terms and conditions herein
set forth. Unless the context otherwise requires, references herein to "this
Agreement" shall include the applicable agreement of one or more Agents to
purchase Notes from the Company as principal. Each purchase of Notes, unless
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otherwise agreed, shall be at a discount from the principal amount of each such
Note equivalent to the applicable commission set forth in Schedule A hereto. The
Agents may engage the services of any broker or dealer in connection with the
resale of the Notes purchased by them as principal and may allow all or any
portion of the discount received from the Company in connection with such
purchases to such brokers or dealers. At the time of each purchase of Notes from
the Company by one or more Agents as principal, such Agent or Agents shall
specify the requirements for the officers' certificate, opinion of counsel and
comfort letter pursuant to Sections 7(b), 7(c) and 7(d) hereof.
If the Company and two or more Agents enter into an agreement
pursuant to which such Agents agree to purchase Notes from the Company as
principal and one or more of such Agents shall fail at the Settlement Date to
purchase the Notes which it or they are obligated to purchase (the "Defaulted
Notes"), then the nondefaulting Agents shall have the right, within 24 hours
thereafter, to make arrangements for one of them or one or more other Agents or
underwriters to purchase all, but not less than all, of the Defaulted Notes in
such amounts as may be agreed upon and upon the terms herein set forth;
provided, however, that if such arrangements shall not have been completed
within such 24-hour period, then:
(i) if the aggregate principal amount of Defaulted Notes does
not exceed 10% of the aggregate principal amount of Notes to be so
purchased by all of such Agents on the Settlement Date, the
nondefaulting Agents shall be obligated, severally and not jointly, to
purchase the full amount thereof in the proportions that their
respective initial underwriting obligations bear to the underwriting
obligations of all nondefaulting Agents; or
(ii) if the aggregate principal amount of Defaulted Notes
exceeds 10% of the aggregate principal amount of Notes to be so
purchased by all of such Agents pursuant to such agreement on the
Settlement Date, such agreement shall terminate without liability on
the part of any nondefaulting Agent.
No action taken pursuant to this paragraph shall relieve any defaulting Agent
from liability in respect of its default. In the event of any such default which
does not result in a termination of such agreement, either the nondefaulting
Agents or the Company shall have the right to postpone the Settlement Date for a
period not exceeding seven days in order to effect any required changes in the
Registration Statement or the Prospectus or in any other documents or
arrangements.
(b) Solicitations as Agent. On the basis of the
representations and warranties herein contained, but subject to the terms and
conditions herein set forth, when agreed by the Company and an Agent, such
Agent, as an agent of the Company, will use its reasonable efforts to solicit
offers for the purchase of Notes upon the terms set forth in the Prospectus. The
Agents are not authorized to appoint sub-agents with respect to Notes sold
through them as agent. All Notes sold through an Agent as agent will be sold at
100% of their principal amount unless otherwise agreed upon between the Company
and such Agent.
The Company reserves the right, in its sole discretion, to
suspend solicitation of offers for the purchase of Notes through an Agent, as an
agent of the Company, commencing at any
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time for any period of time or permanently. As soon as practicable after receipt
of instructions from the Company, such Agent will suspend solicitation of offers
for the purchase of Notes from the Company until such time as the Company has
advised such Agent that such solicitation may be resumed.
The Company agrees to pay each Agent a commission, in the form
of a discount, equal to the applicable percentage of the principal amount of
each Note sold by the Company as a result of a solicitation made by such Agent,
as an agent of the Company, as set forth in Schedule A hereto.
(c) Administrative Procedures. The purchase price, interest
rate or formula, maturity date and other terms of the Notes specified in Exhibit
A hereto (as applicable) shall be agreed upon between the Company and the
applicable Agent(s) and specified in a pricing supplement to the Prospectus
(each, a "Pricing Supplement") to be prepared by the Company in connection with
each sale of Notes. Except as otherwise specified in the applicable Pricing
Supplement, the Notes will be issued in denominations of U.S. $1,000 or any
larger amount that is an integral multiple of U.S. $1,000. Administrative
procedures with respect to the issuance and sale of the Notes (the "Procedures")
shall be agreed upon from time to time among the Company, the Agents and the
Trustee. The Agents and the Company agree to perform, and the Company agrees to
cause the Trustee to agree to perform, their respective duties and obligations
specifically provided to be performed by them in the Procedures.
SECTION 4. Covenants of the Company.
The Company covenants and agrees with each Agent as follows:
(a) Notice of Certain Events. The Company will notify the
Agents immediately, and confirm such notice in writing, of (i) the effectiveness
of any post-effective amendment to the Registration Statement or the filing of
any amendment or supplement to the Prospectus (other than any amendment or
supplement thereto providing solely for the determination of the variable terms
of the Notes or relating solely to the offering of securities other than the
Notes), (ii) the receipt of any comments from the Commission, (iii) any request
by the Commission for any amendment to the Registration Statement or any
amendment or supplement to the Prospectus or for additional information, (iv)
the issuance by the Commission of any stop order suspending the effectiveness of
the Registration Statement, or of any order preventing or suspending the use of
any preliminary prospectus, or of the initiation of any proceedings for that
purpose or (v) any change in the rating assigned by any nationally recognized
statistical rating organization to the Program or any debt securities (including
the Notes) of the Company, or the public announcement by any nationally
recognized statistical rating organization that it has under surveillance or
review, with possible negative implications, its rating of the Program or any
such debt securities, or the withdrawal by any nationally recognized statistical
rating organization of its rating of the Program or any such debt securities.
The Company will make every reasonable effort to prevent the issuance of any
stop order and, if any stop order is issued, to obtain the lifting thereof at
the earliest possible moment.
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(b) Filing or Use of Amendments. The Company will give the
Agents advance notice of its intention to file or prepare any additional
registration statement with respect to the registration of additional Notes, any
amendment to the Registration Statement (including any filing under Rule 462(b)
of the 1933 Act Regulations) or any amendment or supplement to the prospectus
included in the Registration Statement at the time it became effective or to the
Prospectus (other than an amendment or supplement thereto providing solely for
the determination of the variable terms of the Notes or relating solely to the
offering of securities other than the Notes), whether pursuant to the 1933 Act,
the 1934 Act or otherwise, will furnish to the Agents copies of any such
document a reasonable amount of time prior to such proposed filing or use, as
the case may be, and will not file any such document to which the Agents or
counsel for the Agents shall object.
(c) Delivery of the Registration Statement. The Company has
furnished to each Agent and to counsel for the Agents, without charge, signed
and conformed copies of the Registration Statement as originally filed and of
each amendment thereto (including exhibits filed therewith or incorporated by
reference therein and documents incorporated or deemed to be incorporated by
reference therein) and signed and conformed copies of all consents and
certificates of experts. The Registration Statement and each amendment thereto
furnished to the Agents will be identical to any electronically transmitted
copies thereof filed with the Commission pursuant to XXXXX, except to the extent
permitted by Regulation S-T.
(d) Delivery of the Prospectus. The Company will deliver to
each Agent, without charge, as many copies of each preliminary prospectus as
such Agent may reasonably request, and the Company hereby consents to the use of
such copies for purposes permitted by the 1933 Act. The Company will furnish to
each Agent, without charge, such number of copies of the Prospectus (as amended
or supplemented) as such Agent may reasonably request. The Prospectus and any
amendments or supplements thereto furnished to the Agents will be identical to
any electronically transmitted copies thereof filed with the Commission pursuant
to XXXXX, except to the extent permitted by Regulation S-T.
(e) Preparation of Pricing Supplements. The Company will
prepare, with respect to any Notes to be sold to or through one or more Agents
pursuant to this Agreement, a Pricing Supplement with respect to such Notes in a
form previously approved by the Agents. The Company will deliver such Pricing
Supplement no later than 11:00 a.m., New York City time, on the business day
following the date of the Company's acceptance of the offer for the purchase of
such Notes and will file such Pricing Supplement pursuant to Rule 424(b)(3)
under the 1933 Act not later than the close of business of the Commission on the
fifth business day after the date on which such Pricing Supplement is first
used.
(f) Prospectus Revisions -- Material Changes. Except as
otherwise provided in subsection (m) of this Section 4, if at any time during
the term of this Agreement any event shall occur or condition shall exist as a
result of which it is necessary, in the opinion of counsel for the Agents or
counsel for the Company, to amend the Registration Statement in order that the
Registration Statement will not contain an untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary to
make the statements therein not
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misleading or to amend or supplement the Prospectus in order that the Prospectus
will not include an untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein not misleading
in the light of the circumstances existing at the time the Prospectus is
delivered to a purchaser, or if it shall be necessary, in the opinion of either
such counsel, to amend the Registration Statement or amend or supplement the
Prospectus in order to comply with the requirements of the 1933 Act or the 1933
Act Regulations, the Company shall give immediate notice, confirmed in writing,
to the Agents to cease the solicitation of offers for the purchase of Notes in
their capacity as agents and to cease sales of any Notes they may then own as
principal, and the Company will promptly prepare and file with the Commission,
subject to Section 4(b) hereof, such amendment or supplement as may be necessary
to correct such statement or omission or to make the Registration Statement and
Prospectus comply with such requirements, and the Company will furnish to the
Agents, without charge, such number of copies of such amendment or supplement as
the Agents may reasonably request. In addition, the Company will comply with the
1933 Act, the 1933 Act Regulations, the 1934 Act and the 1934 Act Regulations so
as to permit the completion of the distribution of each offering of Notes.
(g) Prospectus Revisions -- Periodic Financial Information.
Except as otherwise provided in subsection (m) of this Section 4, on or prior to
the date on which there shall be released to the general public interim
financial statement information related to the Company with respect to each of
the first three quarters of any fiscal year or preliminary financial statement
information with respect to any fiscal year, the Company shall furnish such
information to the Agents, confirmed in writing, and shall cause the Prospectus
to be amended or supplemented (which amendment or supplement may be effected
through filing a document incorporated by reference) to include financial
information with respect thereto and corresponding information for the
comparable period of the preceding fiscal year, as well as such other
information and explanations as shall be necessary for an understanding thereof
or as shall be required by the 1933 Act or the 1933 Act Regulations.
(h) Prospectus Revisions -- Audited Financial Information.
Except as otherwise provided in subsection (m) of this Section 4, on or prior to
the date on which there shall be released to the general public financial
information included in or derived from the audited consolidated financial
statements of the Company for the preceding fiscal year, the Company shall
furnish such information to the Agents, confirmed in writing, and shall cause
the Prospectus to be amended or supplemented (which amendment or supplement may
be effected through filing a document incorporated by reference) to include such
audited consolidated financial statements and the report or reports, and consent
or consents to such inclusion, of the independent accountants with respect
thereto, as well as such other information and explanations as shall be
necessary for an understanding of such consolidated financial statements or as
shall be required by the 1933 Act or the 1933 Act Regulations.
(i) Earnings Statements. The Company will timely file such
reports pursuant to the 1934 Act as are necessary in order to make generally
available to its securityholders as soon as practicable an earnings statement
for the purposes of, and to provide the benefits contemplated by, the last
paragraph of Section 11(a) of the 1933 Act.
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(j) Reporting Requirements. The Company, during the period
when the Prospectus is required to be delivered under the 1933 Act or the 1934
Act, will file all documents required to be filed with the Commission pursuant
to the 1934 Act within the time periods prescribed by the 1934 Act and the 1934
Act Regulations.
(k) Restriction on Offers and Sales of Securities. Unless
otherwise agreed upon between one or more Agents acting as principal and the
Company, between the date of the agreement by such Agent(s) to purchase the
related Notes from the Company and the Settlement Date with respect thereto, the
Company will not, without the prior written consent of such Agent(s), issue,
sell, offer or contract to sell, grant any option for the sale of, or otherwise
dispose of, any debt securities of the Company (other than the Notes that are to
be sold pursuant to such agreement or commercial paper in the ordinary course of
business). This paragraph does not apply to the negotiation, execution or use of
short-term lines of credit.
(l) Use of Proceeds. The Company will use the net proceeds
received by it from the issuance and sale of the Notes in the manner specified
in the Prospectus.
(m) Suspension of Certain Obligations. The Company shall not
be required to comply with the provisions of subsections (f), (g) or (h) of this
Section 4 during any period from the time (i) the Agents shall have suspended
solicitation of offers for the purchase of Notes in their capacity as agents
pursuant to a request from the Company and (ii) no Agent shall then hold any
Notes purchased from the Company as principal, as the case may be, until the
time the Company shall determine that solicitation of offers for the purchase of
Notes should be resumed or an Agent shall subsequently purchase Notes from the
Company as principal.
SECTION 5. Conditions of Agents' Obligations.
The obligations of one or more Agents to purchase Notes from
the Company as principal and to solicit offers for the purchase of Notes as an
agent of the Company, and the obligations of any purchasers of Notes sold
through an Agent as an agent of the Company, will be subject to the accuracy of
the representations and warranties on the part of the Company herein contained
or contained in any certificate of an officer of the Company or any of its
subsidiaries delivered pursuant to the provisions hereof, to the performance and
observance by the Company of its covenants and other obligations hereunder, and
to the following additional conditions precedent:
(a) Effectiveness of Registration Statement. The Registration
Statement (including any Rule 462(b) Registration Statement) has become
effective under the 1933 Act and no stop order suspending the effectiveness of
the Registration Statement shall have been issued under the 1933 Act and no
proceedings for that purpose shall have been instituted or shall be pending or
threatened by the Commission, and any request on the part of the Commission for
additional information shall have been complied with to the reasonable
satisfaction of counsel to the Agents.
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(b) Legal Opinions. On the date hereof, the Agents shall have
received the following legal opinions, dated as of the date hereof and in form
and substance satisfactory to the Agents:
(1) Opinion of Counsel for the Company. The favorable
opinion of Xxxxxxxxx Xxxxxx PLLC, special counsel for the
Company, and Xxxxxx X. Xxxxxxx, General Counsel to the
Company, substantially to the effect in the aggregate
set forth in Exhibit B hereto and to such further effect as
the Agents may reasonably request. In giving such opinion,
such counsel may assume, that the Notes, in the forms
certified on the date hereof, and the Indenture are governed
by the law of the State of Michigan, notwithstanding the
express choice of law provision contained therein. Such
counsel may also state that, insofar as such opinion
involves factual matters, they have relied, to the extent
they deem proper, upon certificates of officers of the
Company and its subsidiaries and certificates of public
officials.
(2) Opinion of Counsel for the Agents. The favorable
opinion of Xxxxx Xxxxxxxxxx LLP, counsel for the Agents,
with respect to such matters as the Agents may reasonably
request.
(c) Officer's Certificate. On the date hereof, there shall not
have been, since the respective dates as of which information is given in the
Prospectus, any Material Adverse Effect and the Agents shall have received a
certificate of the President or a Vice President of the Company or of the chief
financial officer or chief accounting officer of the Company, dated as of the
date hereof, to the effect that (i) there has been no such Material Adverse
Effect, (ii) the representations and warranties of the Company herein contained
are true and correct with the same force and effect as though expressly made at
and as of the date of such certificate, (iii) the Company has complied with all
agreements and satisfied all conditions on its part to be performed or satisfied
at or prior to the date of such certificate, and (iv) no stop order suspending
the effectiveness of the Registration Statement has been issued and no
proceedings for that purpose have been instituted, are pending or, to the best
of such officer's knowledge, are threatened by the Commission.
(d) Comfort Letter of Xxxxxx Xxxxxxxx LLP. On the date hereof,
the Agents shall have received a letter from Xxxxxx Xxxxxxxx LLP, dated as of
the date hereof and in form and substance satisfactory to the Agents.
(e) Additional Documents. On the date hereof, counsel to the
Agents shall have been furnished with such documents and opinions as such
counsel may require for the purpose of enabling such counsel to pass upon the
issuance and sale of Notes as herein contemplated and related proceedings, or in
order to evidence the accuracy of any of the representations and warranties, or
the fulfillment of any of the conditions, herein contained; and all proceedings
taken by the Company in connection with the issuance and sale of Notes as herein
contemplated shall be satisfactory in form and substance to the Agents and to
counsel to the Agents.
If any condition specified in this Section 5 shall not have
been fulfilled when and as required to be fulfilled, this Agreement may be
terminated by the applicable Agent or Agents
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by notice to the Company at any time and any such termination shall be without
liability of any party to any other party except as provided in Section 10
hereof and except that Sections 8, 9, 11, 14 and 15 hereof shall survive any
such termination and remain in full force and effect.
SECTION 6. Delivery of and Payment for Notes Sold through an Agent as
Agent.
Delivery of Notes sold through an Agent as an agent of the
Company shall be made by the Company to such Agent for the account of any
purchaser only against payment therefor in immediately available funds. In the
event that a purchaser shall fail either to accept delivery of or to make
payment for a Note on the date fixed for settlement, such Agent shall promptly
notify the Company and deliver such Note to the Company and, if such Agent has
theretofore paid the Company for such Note, the Company will promptly return
such funds to such Agent. If such failure has occurred for any reason other than
default by such Agent in the performance of its obligations hereunder, the
Company will reimburse such Agent on an equitable basis for its loss of the use
of the funds for the period such funds were credited to the Company's account.
SECTION 7. Additional Covenants of the Company.
The Company further covenants and agrees with each Agent as
follows:
(a) Reaffirmation of Representations and Warranties. Each
acceptance by the Company of an offer for the purchase of Notes (whether to one
or more Agents as principal or through an Agent as agent), and each delivery of
Notes (whether to one or more Agents as principal or through an Agent as agent),
shall be deemed to be an affirmation that the representations and warranties of
the Company herein contained and contained in any certificate theretofore
delivered to the Agents pursuant hereto are true and correct at the time of such
acceptance or sale, as the case may be, and an undertaking that such
representations and warranties will be true and correct at the time of delivery
to such Agent(s) or to the purchaser or its agent, as the case may be, of the
Notes relating to such acceptance or sale, as the case may be, as though made at
and as of each such time (it being understood that such representations and
warranties shall relate to the Registration Statement and Prospectus as amended
and supplemented to each such time).
(b) Subsequent Delivery of Certificates. Each time that (i)
the Registration Statement or the Prospectus shall be amended or supplemented
(other than by an amendment or supplement providing solely for the determination
of the variable terms of the Notes or relating solely to the offering of
securities other than the Notes), (ii) (if required in connection with the
purchase of Notes from the Company by one or more Agents as principal) the
Company sells Notes to one or more Agents as principal or (iii) the Company
sells Notes in a form not previously certified to the Agents by the Company, the
Company shall furnish or cause to be furnished to the Agent(s), forthwith a
certificate dated the date of filing with the Commission or the date of
effectiveness of such amendment or supplement, as applicable, or the date of
such sale, as the case may be, in form satisfactory to the Agent(s) to the
effect that the statements
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contained in the certificate referred to in Section 5(c) hereof which were last
furnished to the Agents are true and correct at the time of the filing or
effectiveness of such amendment or supplement, as applicable, or the time of
such sale, as the case may be, as though made at and as of such time (except
that such statements shall be deemed to relate to the Registration Statement and
the Prospectus as amended and supplemented to such time) or, in lieu of such
certificate, a certificate of the same tenor as the certificate referred to in
Section 5(c) hereof, modified as necessary to relate to the Registration
Statement and the Prospectus as amended and supplemented to the time of delivery
of such certificate (it being understood that, in the case of clause (ii) above,
any such certificate shall also include a certification that there has been no
Material Adverse Effect since the date of the agreement by such Agent(s) to
purchase Notes from the Company as principal).
(c) Subsequent Delivery of Legal Opinions. Each time that (i)
the Registration Statement or the Prospectus shall be amended or supplemented
(other than by an amendment or supplement providing solely for the determination
of the variable terms of the Notes or relating solely to the offering of
securities other than the Notes), (ii) (if required in connection with the
purchase of Notes from the Company by one or more Agents as principal) the
Company sells Notes to one or more Agents as principal or (iii) the Company
sells Notes in a form not previously certified to the Agents by the Company, the
Company shall furnish or cause to be furnished forthwith to the Agent(s) and to
counsel to the Agents the written opinion of Xxxxxxxxx Xxxxxx PLLC, special
counsel to the Company and Xxxxxx X. Xxxxxxx, General Counsel to the Company, or
other counsel satisfactory to the Agent(s), dated the date of filing with the
Commission or the date of effectiveness of such amendment or supplement, as
applicable, or the date of such sale, as the case may be, in form and substance
satisfactory to the Agent(s), of the same tenor as the opinion referred to in
Section 5(b)(1) hereof, but modified, as necessary, to relate to the
Registration Statement and the Prospectus as amended and supplemented to the
time of delivery of such opinion or, in lieu of such opinion, counsel last
furnishing such opinion to the Agents shall furnish the Agent(s) with a letter
substantially to the effect that the Agent(s) may rely on such last opinion to
the same extent as though it was dated the date of such letter authorizing
reliance (except that statements in such last opinion shall be deemed to relate
to the Registration Statement and the Prospectus as amended and supplemented to
the time of delivery of such letter authorizing reliance).
(d) Subsequent Delivery of Comfort Letters. Each time that (i)
the Registration Statement or the Prospectus shall be amended or supplemented to
include additional financial information (other than by an amendment or
supplement relating solely to the issuance and/or offering of securities other
than the Notes) or (ii) (if required in connection with the purchase of Notes
from the Company by one or more Agents as principal) the Company sells Notes to
one or more Agents as principal, the Company shall cause Xxxxxx Xxxxxxxx LLP
forthwith to furnish to the Agent(s) a letter, dated the date of filing with the
Commission or the date of effectiveness of such amendment or supplement, as
applicable, or the date of such sale, as the case may be, in form satisfactory
to the Agent(s), of the same tenor as the letter referred to in Section 5(d)
hereof but modified to relate to the Registration Statement and Prospectus as
amended and supplemented to the date of such letter.
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SECTION 8. Indemnification.
(a) Indemnification of the Agents. The Company agrees to
indemnify and hold harmless each Agent and each person, if any, who controls
such Agent within the meaning of Section 15 of the 1933 Act or Section 20 of the
1934 Act as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of an untrue statement or
alleged untrue statement of a material fact contained in the
Registration Statement (or any amendment thereto), or the omission or
alleged omission therefrom of a material fact required to be stated
therein or necessary to make the statements therein not misleading, or
arising out of an untrue statement or alleged untrue statement of a
material fact included in any preliminary prospectus or the Prospectus
(or any amendment or supplement thereto), or the omission or alleged
omission therefrom of a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading;
(ii) against any and all loss, liability, claim, damage
and expense whatsoever, as incurred, to the extent of the aggregate
amount paid in settlement of any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or threatened,
or any claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission, provided
that (subject to Section 8(d) hereof) any such settlement is effected
with the written consent of the Company; and
(iii) against any and all expense whatsoever, as incurred
(including the reasonable fees and disbursements of counsel chosen by
such Agent), reasonably incurred in investigating, preparing or
defending against any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, or any
such alleged untrue statement or omission, to the extent that any such
expense is not paid under subparagraph (i) or (ii) above;
provided, however, that this indemnity does not apply to any loss, liability,
claim, damage or expense to the extent arising out of an untrue statement or
omission or alleged untrue statement or omission made in reliance upon and in
conformity with written information furnished to the Company by the Agents
expressly for use in the Registration Statement (or any amendment thereto) or
any preliminary prospectus or the Prospectus (or any amendment or supplement
thereto).
(b) Indemnification of Company, Directors and Officers. Each
Agent severally agrees to indemnify and hold harmless the Company, its
directors, each of its officers who signed the Registration Statement and each
person, if any, who controls the Company within the meaning of Section 15 of the
1933 Act or Section 20 of the 1934 Act against any and all loss, liability,
claim, damage and expense described in the indemnity contained in Section 8(a)
hereof, as incurred, but only with respect to untrue statements or omissions, or
alleged untrue statements or omissions, made in the Registration Statement (or
any amendment thereto) or any preliminary prospectus or the Prospectus (or any
amendment or supplement thereto) in reliance upon and in
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conformity with written information furnished to the Company by the Agents
expressly for use in the Registration Statement (or any amendment thereto) or
such preliminary prospectus or the Prospectus (or any amendment or supplement
thereto).
(c) Actions Against Parties; Notification. Each indemnified
party shall give notice as promptly as reasonably practicable to each
indemnifying party of any action commenced against it in respect of which
indemnity may be sought hereunder, but failure to so notify an indemnifying
party shall not relieve such indemnifying party from any liability hereunder to
the extent it is not materially prejudiced as a result thereof and in any event
shall not relieve it from any liability which it may have otherwise than on
account of this indemnity agreement. In the case of parties indemnified pursuant
to Section 8(a) hereof, counsel to the indemnified parties shall be selected by
the applicable Agent(s) and, in the case of parties indemnified pursuant to
Section 8(b) hereof, counsel to the indemnified shall be selected by the
Company. An indemnifying party may participate at its own expense in the defense
of any such action; provided, however, that counsel to the indemnifying party
shall not (except with the consent of the indemnified party) also be counsel to
the indemnified party. In no event shall the indemnifying parties be liable for
fees and expenses of more than one counsel (in addition to any local counsel)
separate from their own counsel for all indemnified parties in connection with
any one action or separate but similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances.
No indemnifying party shall, without the prior written consent
of the indemnified parties, settle or compromise or consent to the entry of any
judgment with respect to any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim
whatsoever in respect of which indemnification or contribution could be sought
under this Section 8 or 9 hereof (whether or not the indemnified parties are
actual or potential parties thereto), unless such settlement, compromise or
consent (i) includes an unconditional release of each indemnified party from all
liability arising out of such litigation, investigation, proceeding or claim and
(ii) does not include a statement as to or an admission of fault, culpability or
a failure to act by or on behalf of any indemnified party.
(d) Settlement without Consent if Failure to Reimburse. If at
any time an indemnified party shall have requested an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel, such
indemnifying party agrees that it shall be liable for any settlement of the
nature contemplated by Section 8(a)(ii) effected without its written consent if
(i) such settlement is entered into more than 45 days after receipt by such
indemnifying party of the aforesaid request, (ii) such indemnifying party shall
have received notice of the terms of such settlement at least 30 days prior to
such settlement being entered into and (iii) such indemnifying party shall not
have reimbursed such indemnified party in accordance with such request prior to
the date of such settlement.
SECTION 9. Contribution.
If the indemnification provided for in Section 8 hereof is for
any reason unavailable to or insufficient to hold harmless an indemnified party
in respect of any losses,
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liabilities, claims, damages or expenses referred to therein, then each
indemnifying party shall contribute to the aggregate amount of such losses,
liabilities, claims, damages and expenses incurred by such indemnified party, as
incurred, (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company, on the one hand, and the applicable Agent(s),
on the other hand, from the offering of the Notes that were the subject of the
claim for indemnification or (ii) if the allocation provided by clause (i) is
not permitted by applicable law, in such proportion as is appropriate to reflect
not only the relative benefits referred to in clause (i) above but also the
relative fault of the Company, on the one hand, and the applicable Agent(s), on
the other hand, in connection with the statements or omissions which resulted in
such losses, liabilities, claims, damages or expenses, as well as any other
relevant equitable considerations.
The relative benefits received by the Company, on the one
hand, and the applicable Agent(s), on the other hand, in connection with the
offering of the Notes that were the subject of the claim for indemnification
shall be deemed to be in the same respective proportions as the total net
proceeds from the offering of such Notes (before deducting expenses) received by
the Company and the total discount or commission received by each applicable
Agent, as the case may be, bears to the aggregate initial offering price of such
Notes.
The relative fault of the Company, on the one hand, and the
applicable Agent(s), on the other hand, shall be determined by reference to,
among other things, whether any untrue or alleged untrue statement of a material
fact or omission or alleged omission to state a material fact relates to
information supplied by the Company or by the applicable Agent(s) and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission.
The Company and the Agents 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 applicable Agent(s) 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 aggregate
amount of losses, liabilities, claims, damages and expenses incurred by an
indemnified party and referred to above in this Section 9 shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any applicable untrue or alleged
untrue statement or omission or alleged omission.
Notwithstanding the provisions of this Section 9, (i) no Agent
shall be required to contribute any amount in excess of the amount by which the
total discount or commission received by such Agent in connection with the
offering of the Notes that were the subject of the claim for indemnification
exceeds the amount of any damages which such Agent has otherwise been required
to pay by reason of any applicable untrue or alleged untrue statement or
omission or alleged omission and (ii) no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the 1933 Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. In addition, in connection with an offering of Notes
purchased from the Company by two or more Agents as principal, the respective
obligations of such Agents to
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contribute pursuant to this Section 9 are several, and not joint, in proportion
to the aggregate principal amount of Notes that each such Agent has agreed to
purchase from the Company.
For purposes of this Section 9, each person, if any, who
controls an Agent within the meaning of Section 15 of the 1933 Act or Section 20
of the 1934 Act shall have the same rights to contribution as such Agent, and
each director of the Company, each officer of the Company and each person, if
any, who controls the Company within the meaning of Section 15 of the 1933 Act
or Section 20 of the 1934 Act shall have the same rights to contribution as the
Company.
SECTION 10. Payment of Expenses.
The Company will pay all expenses incident to the performance
of its obligations under this Agreement, including:
(a) The preparation, filing, printing and delivery of the
Registration Statement as originally filed and all amendments thereto and any
preliminary prospectus, the Prospectus and any amendments or supplements
thereto;
(b) The preparation, printing and delivery of this Agreement
and the Indenture;
(c) The preparation, issuance and delivery of the Notes,
including any fees and expenses relating to the eligibility and issuance of
Notes in book-entry form and the cost of obtaining CUSIP or other identification
numbers for the Notes;
(d) The fees and disbursements of the Company's accountants,
counsel and other advisors or agents (including any calculation agent or
exchange rate agent) and of the Trustee and its counsel;
(e) The reasonable fees and disbursements of counsel to the
Agents incurred in connection with the establishment of the Program and incurred
from time to time in connection with the transactions contemplated hereby;
(f) The fees charged by nationally recognized statistical
rating organizations for the rating of the Program and the Notes;
(g) The filing fees incident to, and the reasonable fees and
disbursements of counsel to the Agents in connection with, the review, if any,
by the National Association of Securities Dealers, Inc. (the "NASD"); and
(h) Any advertising and other out-of-pocket expenses of the
Agents incurred with the approval of the Company.
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SECTION 11. Representations, Warranties and Agreements to Survive
Delivery.
All representations, warranties and agreements contained in
this Agreement or in certificates of officers of the Company or any of its
subsidiaries submitted pursuant hereto or thereto shall remain operative and in
full force and effect, regardless of any investigation made by or on behalf of
the Agents or any controlling person of an Agent, or by or on behalf of the
Company, and shall survive each delivery of and payment for the Notes.
SECTION 12. Termination.
(a) Termination of this Agreement. This Agreement (excluding
any agreement by one or more Agents to purchase Notes from the Company as
principal) may be terminated for any reason, at any time by either the Company
or an Agent, as to itself, upon the giving of 30 days' prior written notice of
such termination to the other party hereto.
(b) Termination of Agreement to Purchase Notes as Principal.
The applicable Agent(s) may terminate any agreement by such Agent(s) to purchase
Notes from the Company as principal, immediately upon notice to the Company, at
any time prior to the Settlement Date relating thereto, if (i) there has been,
since the date of such agreement or since the respective dates as of which
information is given in the Prospectus, any Material Adverse Effect or (ii)
there has occurred any material adverse change in the financial markets in the
United States, or any outbreak of hostilities or escalation thereof or other
calamity or crisis or any change or development or event involving a prospective
change in national or international political, financial or economic conditions,
in each case the effect of which is such as to make it, in the judgment of such
Agent(s), impracticable to market such Notes or enforce contracts for the sale
of such Notes, or (iii) trading in any securities of the Company has been
suspended or materially limited by the Commission or a national securities
exchange, or if trading generally on the New York Stock Exchange or the American
Stock Exchange or in the Nasdaq National Market has been suspended or materially
limited, or minimum or maximum prices for trading have been fixed, or maximum
ranges for prices have been required, by either of said exchanges or by such
system or by order of the Commission, the NASD or any other governmental
authority, or (iv) a banking moratorium has been declared by either Federal or
New York authorities, or (v) the rating assigned by any nationally recognized
statistical rating organization to the Program or any debt securities (including
the Notes) of the Company as of the date of such agreement shall have been
lowered or withdrawn since that date or if any such rating organization shall
have publicly announced that it has under surveillance or review (with negative
implications) its rating of the Program or any such debt securities, or (vi)
there shall have come to the attention of such Agent(s) any facts that would
cause such Agent(s) to believe that the Prospectus, at the time it was required
to be delivered to a purchaser of such Notes, included an untrue statement of a
material fact or omitted to state a material fact necessary in order to make the
statements therein, in the light of the circumstances existing at the time of
such delivery, not misleading.
(c) General. In the event of any such termination, neither
party will have any liability to the other party hereto, except that (i) the
Agents shall be entitled to any commissions earned in accordance with the third
paragraph of Section 3(b) hereof, (ii) if at the time of
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termination (a) any Agent shall own any Notes purchased by it from the Company
as principal or (b) an offer to purchase any of the Notes has been accepted by
the Company but the time of delivery to the purchaser or his agent of such Notes
relating thereto has not occurred, the covenants set forth in Sections 4 and 7
hereof shall remain in effect until such Notes are so resold or delivered, as
the case may be, and (iii) the covenant set forth in Section 4(i) hereof, the
provisions of Section 10 hereof, the indemnity and contribution agreements set
forth in Sections 8 and 9 hereof, and the provisions of Sections 11, 14 and 15
hereof shall remain in effect.
SECTION 13. Notices.
Unless otherwise provided herein, all notices required under
the terms and provisions hereof shall be in writing, either delivered by hand,
by mail or by telex, telecopier or telegram, and any such notice shall be
effective when received at the address specified below.
If to the Company:
SEMCO Energy, Inc.
000 Xxxxx Xxxxxx
Xxxx Xxxxx, Xxxxxxxx 00000
Attention: Xxxxx X. Xxxxx, Xx.
Telecopy No.: (000) 000-0000
If to the Agents:
Xxxxxxx Xxxxx & Co.
Xxxxxxx Xxxxx, Xxxxxx, Xxxxxx & Xxxxx
Incorporated
World Financial Center
North Tower - 10th Floor
New York, New York 10281-1310
Attention: MTN Product Management
Telecopy No.: (000) 000-0000
Xxxxxx Xxxxxxx & Co. Incorporated
1585 Broadway-2nd Floor
New York, New York 10036
Attention: Manager- Continuously Offered Products
Telecopy No.: (000) 000-0000
with a copy to:
Xxxxxx Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx-00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx Xxxxxx, Investment Information
Center
Telecopy No.: (000) 000-0000
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X.X. Xxxxxxx & Sons, Inc.
Xxx Xxxxx Xxxxxxxxx Xxxxxx
X Xxxxxxxx, Xxxxxx Xxxxx
Xx. Xxxxx, Xxxxxxxx 00000
Attention: Xxxx X. Xxxxx
Telecopy No.: (000) 000-0000
Xxxxxx X. Xxxxx & Co., L.P.
00000 Xxxxxxxxxx Xxxx
Xx. Xxxxx, Xxxxxxxx 00000-3729
Attention: Xxxxx X. Xxxxxxxx
Telecopy No.: (000) 000-0000
or at such other address as such party may designate from time to time by notice
duly given in accordance with the terms of this Section 13.
SECTION 14. Parties.
This Agreement shall inure to the benefit of and be binding
upon the Agents and the Company and their respective successors. Nothing
expressed or mentioned in this Agreement is intended or shall be construed to
give any person, firm or corporation, other than the parties hereto and their
respective successors and the controlling persons, officers and directors
referred to in Sections 8 and 9 hereof and their heirs and legal
representatives, any legal or equitable right, remedy or claim under or in
respect of this Agreement or any provision herein contained. This Agreement and
all conditions and provisions hereof are intended to be for the sole and
exclusive benefit of the parties hereto and their respective successors, and
said controlling persons, officers and directors and their heirs and legal
representatives, and for the benefit of no other person, firm or corporation. No
purchaser of Notes shall be deemed to be a successor by reason merely of such
purchase.
SECTION 15. GOVERNING LAW; FORUM.
THIS AGREEMENT AND ALL THE RIGHTS AND OBLIGATIONS OF THE
PARTIES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAW PRINCIPLES. ANY SUIT, ACTION
OR PROCEEDING BROUGHT BY THE COMPANY AGAINST ANY AGENT IN CONNECTION WITH OR
ARISING UNDER THIS AGREEMENT SHALL BE BROUGHT SOLELY IN THE STATE OR FEDERAL
COURT OF APPROPRIATE JURISDICTION LOCATED IN THE BOROUGH OF MANHATTAN, THE CITY
OF NEW YORK.
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SECTION 16. Effect of Headings.
The Article and Section headings herein are for convenience
only and shall not affect the construction hereof.
SECTION 17. Counterparts.
This Agreement may be executed in one or more counterparts
and, if executed in more than one counterpart, the executed counterparts hereof
shall constitute a single instrument.
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If the foregoing is in accordance with the Agents'
understanding of our agreement, please sign and return to the Company a
counterpart hereof, whereupon this Distribution Agreement, along with all
counterparts, will become a binding agreement among the Agents and the Company
in accordance with its terms.
Very truly yours,
SEMCO Energy, Inc.
By: /s/ Xxxxxxx X. Xxxxxxx
----------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: President and Chief
Executive Officer
CONFIRMED AND ACCEPTED,
as of the date first above written:
XXXXXXX XXXXX & CO.
XXXXXXX LYNCH, XXXXXX, XXXXXX & XXXXX
INCORPORATED
BY: /s/ Xxxxx X. Xxxxxxxx
------------------------------
Title: Authorized Signatory
X.X. XXXXXXX & SONS, INC.
BY: /s/ Xxxxx X. Xxxxxxxxx
------------------------------
Title: Associate Vice President
XXXXXX XXXXXXX & CO. INCORPORATED
BY: /s/ Xxxx Xxxxx
------------------------------
Title: Vice President
XXXXXX X. XXXXX & Co., L.P.
BY:/s/ Xxxxx X. Xxxxxxxx
-------------------------------
Title: Principal
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SCHEDULE A
As compensation for the services of the Agents hereunder, the
Company shall pay the applicable Agent, on a discount basis, a commission for
the sale of each Note equal to the principal amount of such Note multiplied by
the appropriate percentage set forth below:
MATURITY RANGES PERCENT OF
--------------- PRINCIPAL AMOUNT
----------------
From 9 months to less than 1 year............................................. .125%
From 1 year to less than 18 months............................................ .150
From 18 months to less than 2 years........................................... .200
From 2 years to less than 3 years............................................. .250
From 3 years to less than 4 years............................................. .350
From 4 years to less than 5 years............................................. .450
From 5 years to less than 6 years............................................. .500
From 6 years to less than 7 years............................................. .550
From 7 years to less than 10 years............................................ .600
From 10 years to less than 15 years........................................... .625
From 15 years to less than 20 years........................................... .700
From 20 years to 30 years..................................................... .750
Greater than 30 years......................................................... *
* to be negotiated
Sch.A-1
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EXHIBIT A
PRICING TERMS
Principal Amount: $_______
Interest Rate or Formula:
If Fixed Rate Note,
Interest Rate:
Interest Payment Dates:
If Floating Rate Note,
Interest Rate Basis(es):
If LIBOR,
/ / LIBOR Reuters Page:
/ / LIBOR Telerate Page:
If CMT Rate,
Designated CMT Telerate Page:
If Telerate Page 7052:
/ / Weekly Average
/ / Monthly Average
Designated CMT Maturity Index:
Index Maturity:
Spread and/or Spread Multiplier, if any:
Initial Interest Rate, if any:
Initial Interest Reset Date:
Interest Reset Dates:
Interest Payment Dates:
Maximum Interest Rate, if any:
Minimum Interest Rate, if any:
Fixed Rate Commencement Date, if any:
Fixed Interest Rate, if any:
Day Count Convention:
Calculation Agent:
Redemption Provisions:
Initial Redemption Date:
Initial Redemption Percentage:
Annual Redemption Percentage Reduction, if any:
Repayment Provisions:
Optional Repayment Date(s):
Original Issue Date:
Stated Maturity Date:
Authorized Denomination:
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Purchase Price: ___%, plus accrued interest, if any, from ___________
Price to Public: ___%, plus accrued interest, if any, from __________
Issue Price:
Settlement Date and Time:
Additional/Other Terms:
Also, in connection with the purchase of Notes from the Company by one or more
Agents as principal, agreement as to whether the following will be required:
Officers' Certificate pursuant to Section 7(b) of the Distribution
Agreement. Legal Opinion pursuant to Section 7(c) of the Distribution
Agreement. Comfort Letter pursuant to Section 7(d) of the Distribution
Agreement.
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EXHIBIT B
FORM OF OPINION OF COMPANY'S COUNSEL
TO BE DELIVERED PURSUANT TO SECTION 5(b)(1)
(1) The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Michigan.
(2) The Company has corporate power and authority to own, lease and
operate its properties and to conduct its business as described in the
Prospectus and to enter into the Distribution Agreement and consummate the
transactions contemplated in the Prospectus.
(3) The Company is duly qualified as a foreign corporation to transact
business and is in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or leasing of
property or the conduct of business, except where the failure to so qualify or
be in good standing would not result in a Material Adverse Effect.
(4) All of the issued and outstanding shares of capital stock of the
Company have been duly authorized and are validly issued, fully paid and
non-assessable; and none of the outstanding shares of capital stock of the
Company were issued in violation of preemptive or other similar rights of any
securityholder of the Company.
(5) Each Significant Subsidiary has been duly incorporated and is
validly existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, has corporate power and authority to own,
lease and operate its properties and to conduct its business as described in the
Prospectus and is duly qualified as a foreign corporation to transact business
and is in good standing in each jurisdiction in which such qualification is
required, whether by reason of the ownership or leasing of property or the
conduct of business, except where the failure to so qualify or be in good
standing would not result in a Material Adverse Effect; except as stated in the
Prospectus, all of the issued and outstanding shares of capital stock of each
Significant Subsidiary has been duly authorized and are validly issued, fully
paid and non-assessable and, to the best of my knowledge, are owned by the
Company, directly or through subsidiaries, free and clear of any security
interest, mortgage, pledge, lien, encumbrance, claim or equity; and none of the
outstanding shares of capital stock of any Significant Subsidiary were issued in
violation of preemptive or other similar rights of any securityholder of such
Significant Subsidiary.
(6) The Distribution Agreement has been duly authorized, executed and
delivered by the Company.
(7) The Indenture has been duly authorized, executed and delivered by
the Company and (assuming due authorization, execution and delivery thereof by
the applicable Trustee) constitutes a valid and legally binding agreement of the
Company, enforceable against the Company in accordance with its terms, except as
the enforcement thereof may be limited by
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bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting the enforcement of creditors' rights generally or by general equitable
principles (regardless of whether enforcement is considered in a proceeding in
equity or at law).
(8) The Notes have been duly authorized by the Company for offer, sale,
issuance and delivery pursuant to the Distribution Agreement and, when issued,
authenticated and delivered in the manner provided for in the Indenture and
delivered against payment of the consideration therefor, will constitute valid
and legally binding obligations of the Company, enforceable against the Company
in accordance with their terms, except as the enforcement thereof may be limited
by bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting the enforcement of creditors' rights generally or by general equitable
principles (regardless of whether enforcement is considered in a proceeding in
equity or at law); and the Notes, in the forms certified on the date hereof, are
in the form contemplated by, and each registered holder thereof is entitled to
the benefits of, the Indenture.
(9) The Indenture and the Notes, in the forms certified on the date
hereof, conform in all material respects to the statements relating thereto
contained in the Prospectus and are in substantially the form filed or
incorporated by reference, as the case may be, as an exhibit to the Registration
Statement.
(10) The information in the Prospectus under "Description of Notes" and
"Certain Federal Income Tax Considerations", and the information in the
Registration Statement under Item 15, to the extent that such information
constitutes matters of law, summaries of legal matters, the Company's charter
and bylaws or legal proceedings, or legal conclusions, has been reviewed by us
and is correct in all material respects.
(11) To the best of our knowledge, neither the Company nor any of its
subsidiaries is in violation of its charter or by-laws and no default by the
Company or any of its subsidiaries exists in the due performance or observance
of any material obligation, agreement, covenant or condition contained in any
Agreement and Instrument that is described or referred to in the Registration
Statement or the Prospectus or filed or incorporated by reference as an exhibit
to the Registration Statement.
(12) The execution, delivery and performance of the Distribution
Agreement, the Indenture and the Notes and any other agreement or instrument
entered into or issued or to be entered into or issued by the Company in
connection with the transactions contemplated in the Prospectus, the
consummation of the transactions contemplated in the Prospectus (including the
issuance and sale of the Notes and the use of the proceeds therefrom as
described in the Prospectus) and the compliance by the Company with its
obligations thereunder have been duly authorized by all necessary corporate
action and do not and will not, whether with or without the giving of notice or
passage of time or both, conflict with or constitute a breach of, or default or
Repayment Event under, or result in the creation or imposition of any lien,
charge or encumbrance upon any assets, properties or operations of the Company
or any of its subsidiaries pursuant to, any Agreement and Instrument known to
us (except for such conflicts, breaches or defaults or liens, charges or
encumbrances that would not have a Material Adverse Effect), nor will such
action result in any violation of the provisions of the charter or by-laws of
the Company or any of its subsidiaries or
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any applicable law, statute, rule, regulation, judgment, order, writ or decree,
known to us, of any government, government instrumentality or court, domestic or
foreign, having jurisdiction over the Company or any of its subsidiaries or any
of their assets, properties or operations.
(13) To the best of our knowledge, there is not pending or threatened
any action, suit, proceeding, inquiry or investigation to which the Company or
any of its subsidiaries thereof is a party or to which the assets, properties or
operations of the Company or any of its subsidiaries thereof is subject, before
or brought by any court or governmental agency or body, domestic or foreign,
which might reasonably be expected to result in a Material Adverse Effect or
which might reasonably be expected to materially and adversely affect the
assets, properties or operations of the Company or any of its subsidiaries, the
performance by the Company of its obligations under the Distribution Agreement,
the Indenture or the Notes or the consummation of the transactions contemplated
in the Prospectus.
(14) All descriptions in the Prospectus of contracts and other
documents to which the Company or any of its subsidiaries are a party are
accurate in all material respects; and, to the best of our knowledge, there are
no franchises, contracts, indentures, mortgages, loan agreements, notes, leases
or other instruments required to be described or referred to in the Registration
Statement or to be filed as exhibits to the Registration Statement other than
those described or referred to therein or filed or incorporated by reference as
exhibits thereto, and the descriptions thereof or references thereto are correct
in all material respects.
(15) The Registration Statement has been declared effective under the
1933 Act; any required filing of the Prospectus pursuant to Rule 424(b) has been
made in the manner and within the time period required by Rule 424(b); and to
the best of our knowledge, no stop order suspending the effectiveness of the
Registration Statement has been issued under the 1933 Act and no proceedings for
that purpose have been initiated or are pending or threatened by the Commission.
(16) The Registration Statement and the Prospectus, excluding the
documents incorporated by reference therein, and each amendment or supplement to
the Registration Statement and Prospectus, excluding the documents incorporated
by reference therein, as of their respective effective or issue dates (other
than the financial statements and supporting schedules included therein or
omitted therefrom and the Trustee's Statement of Eligibility on Form T-1 (the
"Form T-1"), as to which we express no opinion), complied as to form in all
material respects with the requirements of the 1933 Act and the 1933 Act
Regulations.
(17) The documents incorporated by reference in the Prospectus (other
than the financial statements and supporting schedules included therein or
omitted therefrom, as to which we express no opinion), when they were filed with
the Commission, complied as to form in all material respects with the
requirements of the 1934 Act and the 1934 Act Regulations.
(18) The Indenture has been duly qualified under the 1939 Act.
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(19) The Company and the Company's subsidiaries are not subject to
regulation under the Public Utility Holding Company Act of 1935, as amended,
other than the provisions of Section 9 (a)(2) thereof.
(20) No filing with, or approval, authorization, consent, license,
registration, qualification, order or decree of, any court or governmental
authority or agency, domestic or foreign, is necessary or required for the due
authorization, execution and delivery by the Company of the Distribution
Agreement, the Indenture and the Notes or for the performance by the Company of
the transactions contemplated in the Distribution Agreement, the Indenture or
the Prospectus, except such as have been previously made, obtained or rendered,
as applicable.
Nothing has come to our attention that would lead us to
believe that the Registration Statement or any amendment thereto, (except for
financial statements and schedules and other financial data included or
incorporated by reference therein or omitted therefrom and for the Form T-1, as
to which we need make no comment), at the time such Registration Statement or
any such amendment became effective, contained an untrue statement of a material
fact or omitted to state a material fact required to be stated therein or
necessary to make the statements therein not misleading or that the Prospectus
or any amendment or supplement thereto (except for financial statements and
schedules and other financial data included or incorporated by reference therein
or omitted therefrom, as to which we need make no comment), at the time the
Prospectus was issued, at the time any such amended or supplemented prospectus
was issued or at the date hereof, included or includes an untrue statement of a
material fact or omitted or omits to state a material fact necessary in order to
make the statements therein, in the light of the circumstances under which they
were made, not misleading. With respect to the materiality of the description of
the consideration paid for Maverick Pipeline Services, Inc., we have relied to a
large extent upon the statements and representations of officers and
representatives of the Company.
In rendering such opinion, such counsel may rely as to matters
of fact (but not as to legal conclusions), to the extent they deem proper, on
certificates of responsible officers of the Company and public officials. Such
opinion shall not state that it is to be governed or qualified by, or that it is
otherwise subject to, any treatise, written policy or other document relating to
legal opinions, including, without limitation, the Legal Opinion Accord of the
ABA Section of Business Law (1991).
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