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EXHIBIT 1.1
DUKE ENERGY FIELD SERVICES
GLOBAL UNDERWRITING AGREEMENT
XXXXXX XXXXXXX & CO. INCORPORATED
As representatives of the several Underwriters
named in Schedule I hereto,
c/o Morgan Xxxxxxx & Co. Incorporated,
0000 Xxxxxxxx,
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
Duke Energy Field Services Corporation, a Delaware corporation (the
"Company"), proposes, subject to the terms and conditions stated herein, to sell
to the several Underwriters named in Schedule I hereto (the "Underwriters") an
aggregate of 26,300,000 shares (the "Firm Shares") and, at the election of the
Underwriters, up to 3,945,000 additional shares (the "Optional Shares") of
Common Stock (par value $.01 per share) ("Stock") of the Company (the Firm
Shares and the Optional Shares which the Underwriters elect to purchase pursuant
to Section 2 hereof are herein collectively called the "Shares").
Xxxxxx Xxxxxxx & Co. Incorporated ("Xxxxxx Xxxxxxx") has agreed to
reserve up to 1,972,500 of the Shares to be purchased by it under this Agreement
for sale to the directors, officers, employees and business associates of the
Company and its principal shareholders and certain other persons (collectively,
"Participants"), as set forth in the Prospectus under the heading "Underwriters"
(the "Directed Share Program"). The Shares to be sold by Xxxxxx Xxxxxxx and its
affiliates pursuant to the Directed Share Program are referred to hereinafter as
the "Directed Shares." Any Directed Shares not orally or otherwise confirmed for
purchase by any Participants by 11:00 p.m. Eastern time on the date on which
this Agreement is executed will be offered to the public by the Underwriters as
set forth in the Prospectus.
1. The Company represents and warrants to, and agrees with, each of the
Underwriters that:
(a) A registration statement in respect of the Firm Shares and
the Optional Shares has been filed on Form S-1 with the Securities and
Exchange Commission (the "Commission"); such registration statement and
any post-effective amendment thereto, each in the form heretofore
delivered to you, and excluding exhibits thereto but including all
documents incorporated by reference in the prospectus contained
therein, for each of the other Underwriters, have been declared
effective by the Commission in such form; no other document with
respect to such registration statement or document incorporated by
reference therein has heretofore been filed with the Commission which
has not been
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delivered to you; and no stop order suspending the effectiveness of
such registration statement has been issued and no proceeding for that
purpose has been initiated or threatened by the Commission (any
preliminary prospectus included in such effective registration
statement or filed with the Commission pursuant to Rule 424(a) of the
rules and regulations of the Commission under the Securities Act of
1933, as amended (the "Act"), being hereinafter called a "Preliminary
Prospectus"; the various parts of such registration statement,
including all exhibits thereto and including the information contained
in the form of final prospectus filed with the Commission pursuant to
Rule 424(b) under the Act in accordance with Section 5(a) hereof and
deemed by virtue of Rule 430A under the Act to be part of the
registration statement at the time it was declared effective, being
hereinafter called the "Registration Statement"; and such final
prospectus, in the form first filed pursuant to Rule 424(b) under the
Act being hereinafter called the "Prospectus"). If the Company has
filed an abbreviated registration statement to register additional
Shares pursuant to Rule 462(b) under the Act (the "Rule 462
Registration Statement"), then any reference herein to the term
"Registration Statement" shall be deemed to include such Rule 462
Registration Statement.
(b) No order preventing or suspending the use of any
Preliminary Prospectus has been issued by the Commission, and each
Preliminary Prospectus, at the time of filing thereof, conformed in all
material respects to the requirements of the Act and the rules and
regulations of the Commission thereunder, and did 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, in
the light of the circumstances under which they were made, not
misleading; except that this representation and warranty shall not
apply to any statements or omissions made in reliance upon and in
conformity with information relating to the Underwriters furnished in
writing to the Company by an Underwriter through you expressly for use
therein.
(c) The Registration Statement conforms and the Prospectus
will conform in all material respects to the requirements of the Act
and the rules and regulations of the Commission thereunder, and the
Registration Statement and the Preliminary Prospectus do not and the
Prospectus will not include any untrue statement of a material fact or
omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading, except that
this representation and warranty shall not apply to statements or
omissions made in any such document in reliance upon and in conformity
with information relating to the Underwriters furnished in writing to
the Company by an Underwriter through you expressly for use therein.
(d) This Agreement has been duly authorized, executed and
delivered by the Company. The compliance by the Company with all of the
provisions of this Agreement and the consummation of the transactions
herein contemplated will not conflict with or result in a breach or
violation of any of the terms or provisions of, or constitute a default
under, any indenture, mortgage, deed of trust,
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loan agreement or other agreement or instrument to which the Company or
any entity in which the Company owns at least 50% of the capital stock
or other interests or voting securities or voting interests (each such
entity, a "subsidiary") is a party or by which the Company or any of
its subsidiaries is bound or to which any of the property or assets of
the Company or any of its subsidiaries is subject, in each case that is
material to the Company and its subsidiaries taken as a whole; nor will
such action result in any violation of the provisions of the
Certificate of Incorporation or By-Laws of the Company or similar
organizational documents of any of its subsidiaries or any statute or
any order, rule or regulation of any court or governmental agency or
body having jurisdiction over the Company or any of its properties; and
no consent, approval, authorization, order, registration or
qualification of or with any such court or governmental agency or body
is required for the consummation by the Company of the transactions
contemplated by this Agreement, except the registration under the Act
of the Shares and such consents, approvals, authorizations,
registrations or qualifications as may be required under state or
foreign securities or Blue Sky laws in connection with the purchase and
distribution of the Shares by the Underwriters.
(e) The Company has been duly incorporated, is validly
existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, has the corporate power and
authority to own its property 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
the conduct of its business or its ownership or leasing of property
requires such qualification, except to the extent that the failure to
be so qualified or be in good standing would not have a material
adverse effect on the Company and its subsidiaries, taken as a whole.
(f) Each subsidiary has been duly incorporated, is validly
existing as a corporation (or limited liability company, as the case
may be) in good standing under the laws of the jurisdiction of its
incorporation or formation, has the corporate (or limited liability
company) power and authority to own its property and to conduct its
business as described in the Prospectus and is duly qualified to
transact business and is in good standing in each jurisdiction in which
the conduct of its business or its ownership or leasing of property
requires such qualification, except to the extent that the failure to
be so qualified or be in good standing or to have such power and
authority singly or in the aggregate would not have a material adverse
effect on the Company and its subsidiaries, taken as a whole; all of
the issued shares of capital stock (or limited liability company
interests) of each subsidiary of the Company have been duly and validly
authorized and issued, are fully paid and non-assessable and are owned
directly by the Company (or if not owned directly by the Company, are
owned by a subsidiary of the Company), free and clear of all liens,
encumbrances, equities or claims.
(g) There has not occurred any material adverse change, or any
development involving a prospective material adverse change, in the
condition, financial or otherwise, or in the earnings, business or
operations of the Company
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and its subsidiaries, taken as a whole, from that set forth in the
Prospectus (exclusive of any amendments or supplements thereto
subsequent to the date of this Agreement).
(h) The Company and its subsidiaries (1) are in compliance
with any and all applicable foreign, federal, state and local laws and
regulations relating to the protection of human health and safety, the
environment or hazardous or toxic substances or wastes, pollutants or
contaminants ("Environmental Laws"), (2) have received all permits,
licenses or other approvals required of them under applicable
Environmental Laws to conduct their respective businesses and (3) are
in compliance with all terms and conditions of any such permit, license
or approval, except where such noncompliance with Environmental Laws,
failure to receive required permits, licenses or other approvals or
failure to comply with the terms and conditions of such permits,
licenses or approvals would not, singly or in the aggregate, have a
material adverse effect on the Company and its subsidiaries, taken as a
whole.
(i) There are no costs or liabilities associated with
Environmental Laws (including, without limitation, any capital or
operating expenditures required for clean-up, closure of properties or
compliance with Environmental Laws or any permit, license or approval,
any related constraints on operating activities and any potential
liabilities to third parties) that would, singly or in the aggregate,
have a material adverse effect on the Company and its subsidiaries,
taken as a whole.
(j) Deloitte & Touche LLP, Ernst & Young LLP and Xxxxxx
Xxxxxxxx LLP, who have certified certain financial statements of the
Company and its subsidiaries, are independent public accountants as
required by the Act and the rules and regulations of the Commission
thereunder.
(k) The Company and its subsidiaries have good and marketable
title to all real property and beneficial or record title to or
interest in all pipeline easements, rights of way, licenses and land
use permits owned by them, except where such failure would not, singly
or in the aggregate, have a material adverse effect on the Company and
its subsidiaries taken as a whole, in each case free and clear of all
liens, encumbrances and defects except (i) such as are described in the
Prospectus and (ii) liens securing taxes and other governmental changes
or claims of materialmen, mechanics and similar persons that are not
yet due and payable and that do not materially affect the value of such
property and do not materially interfere with the use made and proposed
to be made of such property by the Company and its subsidiaries; and
any real property and buildings held under lease by the Company and its
subsidiaries are held by them under leases that are valid, existing and
in full force and effect, except as described in the Prospectus or
where the failure to be valid, existing and in full force and effect
would not have a material adverse effect on the Company and its
subsidiaries, taken a whole.
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(l) Except as described in the Prospectus, the Company and its
subsidiaries possess all certificates, authorizations and permits
issued by the appropriate federal, state or foreign regulatory
authorities necessary to conduct their respective businesses except
where such failure to possess required certificates, authorizations and
permits would not, singly or in the aggregate, have a material adverse
effect on the Company and its subsidiaries, taken as a whole, and
neither the Company nor any of its subsidiaries has received any notice
of proceedings relating to the revocation or modification of any such
certificate, authorization or permit that, singly or in the aggregate,
if the subject of an unfavorable decision, ruling or finding, would
have a material adverse effect on the Company and its subsidiaries,
taken as a whole.
(m) There are no legal or governmental proceedings pending or
to the Company's knowledge threatened or expected to which the Company
or any of its subsidiaries is a party or to which any of the properties
of the Company or any of its subsidiaries is subject that are required
to be described in the Registration Statement or the Prospectus and are
not so described or any statutes, regulations, contracts or other
documents that are required to be described in the Registration
Statement or the Prospectus or to be filed as exhibits to the
Registration Statement that are not described or filed as required.
(n) No material labor dispute with the employees of the
Company or any of its subsidiaries exists, except as described in the
Prospectus, or, to the knowledge of the Company, is imminent.
(o) There are no contracts, agreements or understandings
between the Company and any person granting such person the right to
require the Company (1) to file a registration statement under the Act
with respect to any securities of the Company (except for contacts,
agreements or understandings described in the Registration Statement or
the Prospectus) or (2) to require the Company to include any such
securities with the Shares registered pursuant to the Registration
Statement.
(p) The statements in the Prospectus under the captions
"Relationship with Duke Energy and Xxxxxxxx," "Shares Eligible for
Future Sale" and "Description of Capital Stock", in each case insofar
as such statements constitute summaries of the documents or proceedings
referred to therein, fairly present the information called for with
respect to such documents and proceedings and fairly summarize the
matters referred to therein.
(q) When distributed together with the Canadian law supplement
dated May 16, 2000, as it may be hereafter amended, the Prospectus and
any Preliminary Prospectus comply, and any amendments or supplements
thereto will comply, with any applicable laws or regulations applicable
to sales of the Directed Shares of foreign jurisdictions in which the
Prospectus or any preliminary prospectus, as amended or supplemented,
if applicable, are distributed in connection with the Directed Share
Program.
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(r) No consent, approval, authorization or order of, or
qualification with, any governmental body or agency, other than those
obtained, is required in connection with the offering of the Directed
Shares in any jurisdiction where the Directed Shares are being offered.
(s) The Company has not offered, or caused Xxxxxx Xxxxxxx or
its affiliates to offer, Shares to any person pursuant to the Directed
Share Program with the intent to unlawfully influence (1) a customer or
supplier of the Company to alter the customer's or supplier's level or
type of business with the Company, or (2) a trade journalist or
publication to write or publish favorable information about the Company
or its products.
(t) The Company is not a "holding company," or a
"public-utility company," or a "subsidiary company" of a "holding
company," as each such term is defined in the Public Utility Holding
Company Act of 1935, as amended.
(u) The shares of Common Stock outstanding prior to the
issuance of the Shares have been duly authorized and are validly
issued, fully paid and non-assessable.
(v) The Shares have been duly authorized and, when issued and
delivered in accordance with the terms of this Agreement, will be
validly issued, fully paid and non-assessable, and the issuance of such
Shares will not be subject to any preemptive or similar rights.
2. Subject to the terms and conditions herein set forth, (a) the
Company agrees to sell to each of the Underwriters, and each of the Underwriters
agrees, severally and not jointly, to purchase from the Company at a purchase
price per share of $_________________ the number of Firm Shares to be purchased
by such Underwriter as set forth opposite the name of such Underwriter in
Schedule I hereto and (b) in the event and to the extent that the Underwriters
shall exercise the election to purchase Optional Shares as provided below, the
Company agrees to sell to each of the Underwriters, and each of the Underwriters
agrees, severally and not jointly, to purchase from the Company, at the purchase
price per share set forth in clause (a) of this Section 2, that portion of the
number of Optional Shares as to which such election shall have been exercised
(to be adjusted by you so as to eliminate fractional shares) determined by
multiplying such number of Optional Shares by a fraction the numerator of which
is the maximum number of Optional Shares that such Underwriter is entitled to
purchase as set forth opposite the name of such Underwriter in Schedule I hereto
and the denominator of which is the maximum number of the Optional Shares that
all of the Underwriters are entitled to purchase hereunder.
The Company hereby grants to the Underwriters the right to purchase at
their election up to 3,945,000 Optional Shares, at the purchase price per share
set forth in the paragraph above, for the sole purpose of covering
over-allotments in the sale of the Firm Shares. Any such election to purchase
Optional Shares may be exercised by written notice from you to the Company,
given within a period of 30 calendar days after the date of this Agreement and
setting forth the aggregate number of Optional Shares to be purchased and the
date on which such Optional Shares are to be delivered, as determined by you but
in no event earlier than the First Time of Delivery (as defined in Section 4
hereof) or, unless you and the Company otherwise agree in writing, earlier than
two or later than ten business days after the date of such notice.
3. Upon the authorization by you of the release of the Firm Shares, the
several Underwriters propose to offer the Firm Shares for sale upon the terms
and conditions set forth in the Prospectus.
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4. Certificates in definitive form for the Shares to be purchased by
each Underwriter hereunder, and in such denominations and registered in such
names as Xxxxxx Xxxxxxx may request upon at least forty-eight hours' prior
notice to the Company, shall be delivered by or on behalf of the Company to you
for the account of such Underwriter, against payment by such Underwriter or on
its behalf of the purchase price therefor by wire transfer in immediately
available funds to an account of the Company properly identified at least 48
hours in advance, at the office of Xxxxxxxx & Xxxxxxxx, 000 Xxxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000 or at such other place as you and the Company may
determine. The time and date of such delivery and payment shall be, with respect
to the Firm Shares, 9:30 a.m., New York City time, on [JUNE 1, 2000], or such
other time and date as you and the Company may agree upon in writing, and, with
respect to the Optional Shares, 9:30 a.m., New York City time, on the date
specified by you in the written notice given by you of the Underwriters'
election to purchase such Optional Shares, or such other time and date as you
and the Company may agree upon in writing. Such time and date for delivery of
the Firm Shares is herein called the "First Time of Delivery," such time and
date for delivery of the Optional Shares, if not the First Time of Delivery, is
herein called the "Second Time of Delivery," and each such time and date of
delivery is herein called a "Time of Delivery." Such certificates will be made
available for checking and packaging at least twenty-four hours prior to each
Time of Delivery at such office of Xxxxxxxx & Xxxxxxxx.
5. The Company covenants and agrees with the several Underwriters that:
(a) Before amending or supplementing the Registration
Statement or the Prospectus, to furnish to you a copy of each such
proposed amendment or supplement and not to file any such proposed
amendment or supplement to which you reasonably object, and to file
with the Commission within the applicable period specified in Rule
424(b) under the Act any prospectus required to be filed pursuant to
such Rule.
(b) The Company will advise you promptly after it receives
notice thereof of the institution by the Commission of any stop order
proceedings in respect of the Registration Statement, and will use its
best efforts to prevent the issuance of any such stop order and to
obtain as soon as possible its withdrawal, if issued.
(c) If at any time when a prospectus relating to the Shares is
required to be delivered under the Act any event occurs as a result of
which the Prospectus as then amended or supplemented would include an
untrue statement of a material fact, or omit to state any material fact
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, or if it is
necessary at any time to amend the Prospectus to comply with the Act,
the Company promptly will prepare and file with the Commission an
amendment, supplement or an appropriate document that will correct such
statement or omission or that will effect such compliance.
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(d) The Company, during the period when a prospectus relating
to the Shares is required to be delivered under the Act, will file
promptly all documents required to be filed with the Commission
pursuant to Section 13 or 14 of the Exchange Act.
(e) The Company will make generally available to its security
holders, in each case as soon as practicable after the close of the
period covered thereby, an earnings statement (in form complying with
the provisions of Section 11(a) of the Act, which need not be certified
by independent certified public accountants unless required by the Act)
covering a twelve-month period beginning not later than the first day
of the Company's fiscal quarter next following the effective date of
the Registration Statement.
(f) The Company will furnish to you copies of the Registration
Statement (three of which will be signed and will include all exhibits
other than those incorporated by reference), the Prospectus, and all
amendments and supplements to such documents, in each case as soon as
available and in such quantities as you reasonably request.
(g) The Company will arrange or cooperate in arrangements for
the qualification of the Shares for sale under the laws of the United
States, each State thereof, the District of Columbia and such
jurisdictions as you reasonably designate and will continue such
qualifications in effect so long as required for the distribution;
provided, however, that the Company shall not be required to qualify as
a foreign corporation or to file any general consents to service of
process under the laws of any state where it is not now so subject.
(h) The Company will not, during the period beginning from the
date hereof and continuing to and including the date 180 days after the
date of the Prospectus, offer, pledge, sell, contract to sell, sell any
option or contract to purchase, purchase any option or contract to
sell, grant any option, right or warrant to purchase, lend or otherwise
dispose of, directly or indirectly, any securities of the Company that
are substantially similar to the Shares (any of the foregoing, a
"Transfer"), including but not limited to any securities that are
convertible into or exchangeable for or that represent the right to
receive the Shares or any such substantially similar securities or
enter into any swap or other arrangement that transfers to another, in
whole or in part, any of the economic consequences of ownership of such
securities, whether or not such transaction is to be settled by the
delivery of common stock or other securities, in cash or otherwise,
without your prior written consent. The foregoing sentence shall not
apply to (A) the Shares to be sold hereunder, (B) any securities of the
Company that are substantially similar to the shares and are issued, or
options to purchase such securities are granted, pursuant to existing
employee benefit plans of the Company referred to in the Prospectus,
(C) any securities that are substantially similar to the Shares and are
issued pursuant to any non-employee director stock plan, (D) any
securities that are issued pursuant to the merger described in the
Prospectus and are substantially similar to the Shares or [(E) any
securities that
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are substantially similar to the Shares or convertible into or
exchangeable for common stock which represent payment of all or part of
the purchase price of a business or assets the Company acquires;
provided the Company shall take all action necessary to ensure that any
securities issued pursuant to clause (E) will not be Transferred by the
holder thereof for 180 days from the date of the Prospectus]. [N.B.
Acquisition exception to be confirmed by MSDW, together with any
applicable cap.]
(i) The Company will take appropriate action to prevent
transfer of any Directed Shares that have been sold to Participants who
are subject to the three month restriction on sale, transfer,
assignment, pledge or hypothecation imposed by NASD Regulation, Inc.
under its Interpretative Material 2110-1 on free-riding and withholding
to the extent necessary to ensure compliance with the three-month
restrictions.
(j) The Company will comply with all applicable securities and
other applicable laws, rules and regulations in each jurisdiction in
which the Directed Shares are offered in connection with the Directed
Share Program.
6. The Company covenants and agrees with the several Underwriters that
(a) the Company will pay or cause to be paid the following: (i) the fees,
disbursements and expenses of the Company's counsel and accountants in
connection with the registration of the Shares under the Act and all other
expenses in connection with the preparation, printing and filing with the
Commission of the Registration Statement, any Preliminary Prospectus, the
Prospectus and amendments and supplements thereto and the mailing and delivering
of copies thereof to the Underwriters and dealers; (ii) the cost of printing or
producing any Agreement among Underwriters, this Agreement, the Selling
Agreements, the Blue Sky memorandum, closing binders and any other documents in
connection with the offering, purchase, sale and delivery of the Shares; (iii)
all expenses in connection with the qualification of the Shares for offering and
sale under state securities laws as provided in Section 5(g) hereof, including
the fees and disbursements of counsel for the Underwriters in connection with
such qualification and in connection with the Blue Sky survey; (iv) the filing
fees and the reasonable fees and disbursements of counsel to the Underwriters
incident to securing any required review by the National Association of
Securities Dealers, Inc. of the terms of the sale of the Shares; (v) the cost of
preparing stock certificates, the cost and charges of any transfer agent or
registrar and; (vi) all costs and expenses incident to listing the Shares on The
New York Stock Exchange, Inc.; (vii) the costs and expenses of the Company
relating to investor presentations on any "road show" undertaken in connection
with the marketing of the offering of the Shares, including, without limitation,
expenses associated with the production of road show slides and graphics, fees
and expenses of any consultants engaged in connection with the road show
presentations with the prior approval of the Company, travel and lodging
expenses of the representatives and officers of the Company and any such
consultants, and the cost of any aircraft chartered in connection with the road
show; (viii) all fees and disbursements of counsel incurred by the Underwriters
in connection with the Directed Share Program and stamp duties, similar taxes or
duties or other taxes, if any, incurred by the Underwriters in connection with
the
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Directed Share Program; and (ix) all other costs and expenses (other than as
provided for in Sections 8 and 9) incident to the performance of the Company's
obligations hereunder that are not otherwise specifically provided for in this
Section. It is understood that, except as provided in this Section, Sections 8,
9 and 11 hereof, the Underwriters will pay all of their own costs and expenses,
including the fees of their counsel, stock transfer taxes on resale of any of
the Shares by them, and any advertising expenses connected with any offers they
may make.
7. The obligations of the Underwriters hereunder, as to the Shares to
be delivered at each Time of Delivery, shall be subject, in their discretion, to
the condition that all representations and warranties of the Company herein are,
at and as of such Time of Delivery, true and correct, the condition that the
Company shall have performed all of its obligations hereunder theretofore to be
performed, and the following additional conditions:
(a) The Prospectus shall have been filed, if required, with
the Commission pursuant to Rule 424(b) within the applicable time
period prescribed for such filing by the rules and regulations under
the Act; no stop order suspending the effectiveness of the Registration
Statement or any part thereof shall have been issued and no proceeding
for that purpose shall have been initiated or, to the knowledge of the
Company, threatened by the Commission; and all requests for additional
information on the part of the Commission shall have been complied with
to your reasonable satisfaction.
(b) Xxxxxxxx & Xxxxxxxx, counsel for the Underwriters, shall
have furnished to you such opinion or opinions, dated such Time of
Delivery, generally with respect to the matters set forth in clause
(c)(i), (c)(ii), (c)(v), (c)(x) and (c)(xii) and with respect to such
other matters as are reasonably requested by you, and such counsel
shall have received such papers and information as they may reasonably
request to enable them to pass upon such matters.
(c) Xxxxxx & Xxxxxx LLP, counsel for the Company, shall have
furnished to you its written opinion, dated such Time of Delivery, in
form and substance satisfactory to you, to the effect that:
(i) The Company is validly existing as a corporation
in good standing under the laws of the jurisdiction of its
incorporation, has the corporate power and authority to own
its property and to conduct its business as described in the
Prospectus;
(ii) The Shares have been duly authorized, and when
issued and delivered in accordance with this Agreement, will
be validly issued, fully paid and non-assessable, and the
issuance of such Shares are not subject to any preemptive or
similar rights.
(iii) Each "Significant Subsidiary" of the Company
(as such term is defined in Rule 1-02 of Regulation S-X) (each
a "Significant
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Subsidiary" and, collectively, the "Significant Subsidiaries")
is validly existing as a corporation (or limited liability
company, as the case may be) in good standing under the laws
of the jurisdiction of its incorporation, has the corporate
(or limited liability company) power and authority to own its
property and to conduct its business as described in the
Prospectus.
(iv) The outstanding shares of Stock of the Company
have been duly authorized and issued and are fully paid and
nonassessable.
(v) The Registration Statement has become effective
under the Act, and, to the knowledge of such counsel, no stop
order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose
have been instituted or are pending or threatened under the
Act.
(vi) This Agreement has been duly authorized,
executed and delivered by the Company.
(vii) The performance by the Company of this
Agreement and the consummation of the transactions herein and
therein contemplated will not contravene any of the provisions
or constitute a default under, any indenture, mortgage, deed
of trust, loan agreement or other agreement or instrument to
which the Company or any of its subsidiaries is a party that
in each case has been filed as an exhibit to the Registration
Statement or any of the provisions of the Certificate of
Incorporation or By-laws of the Company.
(viii) The Company is not and, after giving effect to
the offering and sale of the Shares and the application of the
proceeds thereof as described in the Prospectus, will not be
required to register as an "investment company" as such term
is defined in the Investment Company Act of 1940, as amended.
(ix) The Company is not, and after giving effect to
the offering and sale of the Shares and the application of the
proceeds thereof as described in the Prospectus will not be,
required to register as a holding company under the Public
Utility Holding Company Act of 1935, as amended.
(x) No authorization, approval or consent of any
governmental body is legally required for the consummation by
the Company of the transactions contemplated by this
Agreement, except the registration under the Act of the
Shares, and such consents, approvals, authorizations,
registrations and qualifications as may be required under
state or foreign securities or Blue Sky laws in connection
with the purchase and distribution of the Shares by the
Underwriters.
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(xi) The descriptions in the Registration Statement
and Prospectus of legal or governmental proceedings are
accurate and fairly present the information required to be
shown and such counsel does not know of any other legal or
governmental proceedings required to be described in the
Registration Statement or Prospectus that are not described as
required.
(xii) The Registration Statement as of the date of
effectiveness under the Act and the Prospectus as of the date
it was filed with, or transmitted for filing to, the
Commission (in each case, other than the financial statements
and other financial information included therein, as to which
no opinion need be rendered) appeared on their face to comply
as to form in all material respects with the requirements of
the Act and the rules and regulations thereunder, and nothing
has come to their attention that would lead them to believe
that the Registration Statement as of the date of
effectiveness under the Act (or if an amendment to such
Registration Statement has been filed by the Company with the
Commission subsequent to the effectiveness of the Registration
Statement, then at the time of the most recent such filing)
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 as of the date it was filed with, or
transmitted for filing to, the Commission and at such Time of
Delivery contained or contains 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.
(xiii) The statements made in the Prospectus under
the caption "Description of Capital Stock", insofar as they
purport to constitute summaries of the terms of the Stock,
under the caption "Material United States Tax Consequences to
Non-United States Holders", insofar as they purport to
constitute summaries of the principal United States federal
income consequences to foreign holders of the Stock , and
under "Relationship with Duke Energy and Xxxxxxxx", "Shares
Eligible for Future Sale" and "Underwriting" insofar as they
purport to constitute summaries of the legal matters and
documents referred to therein, are accurate in all material
respects.
In rendering such opinion, such counsel may state that they
express no opinion as to the laws of any jurisdiction other than the
State of Texas, the general corporation law of the State of Delaware
and the federal securities laws of the United States.
(d) Xxxxxx Xxxxxx, General Counsel to the Company shall have
furnished to you her written opinion dated such Time of Delivery, in
form and substance satisfactory to you, to the effect that:
-12-
13
(i) each of the Company and its subsidiaries is
validly existing as a corporation (or limited liability
company, as the case may be), is in good standing under the
laws of the jurisdiction of its incorporation, has the
corporate (or limited liability company) power and authority
to own its property and to conduct its business as described
in the Prospectus and is duly qualified to transact business
and is in good standing in each jurisdiction in which the
conduct of its business or its ownership or leasing of
property requires such qualification, except to the extent
that the failure to be so qualified or be in good standing
would not have a material adverse effect on the Company and
its subsidiaries, taken as a whole.
(ii) the performance by the Company of this Agreement
and the consummation of the transactions herein and therein
contemplated will not contravene any of the provisions or
constitute a default under, any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument to
which the Company or any of its subsidiaries is a party or by
which the Company or any of its subsidiaries is bound or to
which any of the property or assets of the Company or any of
its subsidiaries is subject, nor will such action contravene
any of the provisions of the Certificate of Incorporation or
By-Laws of any of its subsidiaries or to the best knowledge of
such counsel any statute or any order, rule or regulation of
any court or governmental agency or body having jurisdiction
over the Company or any of its properties.
(iii) the descriptions in the Registration Statement
and Prospectus of legal or governmental proceedings are
accurate and fairly present the information required to be
shown and such counsel does not know of any other legal or
governmental proceedings required to be described in the
Registration Statement or Prospectus that are not described as
required.
(e) At 10:00 a.m., New York City time, on the effective date
of the Registration Statement and also at each Time of Delivery,
Deloitte & Touche LLP and Ernst & Young LLP and Xxxxxx Xxxxxxxx LLP
shall have furnished to you a letter or letters, dated the respective
date of delivery thereof in form and substance satisfactory to you, to
the effect set forth in Annex I hereto.
(f) Since the respective dates as of which information is
given in the Prospectus, there shall not have been any change or any
development involving a prospective change, in the condition, financial
or otherwise, or in the earnings, business or operations of the Company
and its subsidiaries, taken as a whole, from that set forth in the
Prospectus (exclusive of any amendments or supplements thereto
subsequent to the date of this Agreement), the effect of which is, in
your judgment, so material and adverse as to make it, in your judgment,
impracticable or inadvisable to proceed with the public offering or the
delivery of the Shares being delivered at such Time of Delivery on the
terms and in the manner contemplated in the Prospectus.
-13-
14
(g) There shall not have occurred any downgrading, nor shall
any notice have been given of any intended or potential downgrading or
of any review for a possible change that does not indicate the
direction of the possible change, in the rating accorded any securities
of the Company or Duke Capital Corporation by any "nationally
recognized statistical rating organization," as such term is defined
for purposes of Rule 436(g)(2) under the Securities Act.
(h) On or after the date hereof there shall not have occurred
any of the following: (i) a suspension or material limitation in
trading in securities generally or of the securities of the Company or
Duke Energy Corporation on the New York Stock Exchange; (ii) a general
moratorium on commercial banking activities in New York declared by
either Federal or New York State authorities; (iii) the outbreak or
material escalation of hostilities or the declaration by the United
States of a national emergency or war; or (iv) any change in financial
markets or any calamity or crisis, if the effect of any such event
specified in these clauses (i) through (iv) in your judgment makes it
impracticable or inadvisable to proceed with the public offering or the
delivery of the Shares being delivered at such Time of Delivery on the
terms and in the manner contemplated in the Prospectus.
(i) "Lock-up" agreements, each substantially in the form of
Exhibit A hereto, between you and the persons listed on Schedule A
hereto relating to sales and certain other dispositions of shares of
Stock or certain other securities, shall have been executed and
delivered to you.
(j) The Company shall have furnished or caused to be furnished
to you at such Time of Delivery certificates of officers of the Company
satisfactory to you as to the accuracy of the representations and
warranties of the Company herein at and as of such Time of Delivery, as
to the performance by the Company of all of its obligations hereunder
to be performed at or prior to such Time of Delivery, and as to such
other matters relating to the transactions contemplated herein as you
may reasonably request, and the Company shall have furnished or caused
to be furnished certificates as to the matters set forth in subsections
(a), (f), (g), (h) and (i) of this Section, and as to such other
matters relating to the transactions contemplated herein as you may
reasonably request.
8. (a) The Company agrees to indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter within the
meaning of Section 15 of the Act or Section 20 of the Securities Exchange Act of
1934 (the "Exchange Act"), as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever arising out of any 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 any untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Prospectus, the prospectus constituting a
part of the
-14-
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Registration Statement in the form in which it became effective 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 to the extent of the aggregate amount paid in
settlement of any litigation, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission or any such
alleged untrue statement or omission, if such settlement is effected
with the written consent of the Company; and
(iii) against any and all expense whatsoever reasonably
incurred in investigating, preparing or defending against any
litigation, 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 (i) or (ii) above;
unless in each case of (i), (ii) or (iii) above such statement or omission or
such alleged statement or omission was made in reliance upon and in conformity
with the information relating to the Underwriters furnished in writing to the
Company by an Underwriter through you expressly for use in the Registration
Statement (or any amendment thereto) or such Preliminary Prospectus or the
Prospectus (or any amendment or supplement thereto).
In no case shall the Company be liable under this indemnity agreement
with respect to any claim made against any Underwriter or any such controlling
person unless the Company shall be notified in writing of the nature of the
claim within a reasonable time after the assertion thereof, but failure so to
notify the Company shall not relieve it from any liability which it may have
otherwise than on account of this indemnity agreement. The Company shall be
entitled to participate at its own expense in the defense, or, if it so elects,
within a reasonable time after receipt of such notice, to assume the defense of
any suit brought to enforce any such claim, but if it so elects to assume the
defense, such defense shall be conducted by counsel chosen by it and approved by
the Underwriter or Underwriters or controlling person or persons, defendant or
defendants in any suit so brought, which approval shall not be unreasonably
withheld. In any such suit, any Underwriter or any such controlling person shall
have the right to employ its own counsel, but the fees and expenses of such
counsel shall be at the expense of such Underwriter or such controlling person
unless (i) the Company and such Underwriter shall have mutually agreed to the
employment of such counsel or (ii) the named parties to any such action
(including any impleaded parties) include both such Underwriter or such
controlling person and the Company and such Underwriter or such controlling
person shall have been advised by such counsel that a conflict of interest
between the Company and such Underwriter or such controlling person may arise
and for this reason it is not desirable for the same counsel to represent both
the indemnifying party and also the indemnified party (it being understood,
however, that the Company shall not, in connection with any one such action or
separate but substantially similar or related
-15-
16
actions in the same jurisdiction arising out of the same general allegations or
circumstances, be liable for the reasonable fees and expenses of more than one
separate firm of attorneys (in addition to any local counsel) for all such
Underwriters and all such controlling persons, which firm shall be designated in
writing by you). The Company agrees to notify you within a reasonable time of
the assertion of any claim against it, any of its officers or directors or any
person who controls the Company within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act, in connection with the sale of the Shares.
(b) Each Underwriter severally agrees to indemnify and hold harmless
the Company, each of its directors and each of the Company's officers who signed
the Registration Statement and each person, if any, who controls the Company
within the meaning of Section 15 of the Act or Section 20 of the Exchange Act,
to the same extent as the indemnity contained in subsection (a) of this Section,
but only with respect to 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
conformity with the information relating to the Underwriters furnished in
writing to the Company by such Underwriter through you expressly for use in the
Registration Statement (or any amendment thereto), such Preliminary Prospectus
or the Prospectus (or any amendment or supplement thereto). In case any action
shall be brought against the Company or any person so indemnified based on the
Registration Statement (or any amendment thereto) or such Preliminary Prospectus
or the Prospectus (or any amendment or supplement thereto) and in respect of
which indemnity may be sought against any Underwriter, such Underwriter shall
have the rights and duties given to the Company, and the Company and each person
so indemnified shall have the rights and duties given to the Underwriters, by
the provisions of subsection (a) of this Section.
(c) No indemnifying party shall, without the prior written consent of
the indemnified party, effect any settlement of any pending or threatened
proceeding in respect of which any indemnified party is or could have been a
party and indemnity could have been sought hereunder by such indemnified party,
unless such settlement includes an unconditional release of such indemnified
party from all liability on claims that are the subject matter of such
proceeding.
(d) To the extent the indemnification provided for in Sections 8(a) or
8(b) is unavailable to an indemnified party or insufficient in respect of any
losses, claims, damages or liabilities referred to therein, then each
indemnifying party under such paragraph, in lieu of indemnifying such
indemnified party thereunder, shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities in such proportion as is appropriate to reflect not only the
relative benefits received by the Company on the one hand and the Underwriters
on the other hand from the offering of the Shares but also the relative fault of
the Company on the one hand and of the Underwriters on the other hand in
connection with the statements or omissions that resulted in such losses,
claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Company on the
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one hand and the Underwriters on the other hand in connection with the offering
of the Shares shall be deemed to be in the same respective proportions as the
net proceeds from the offering of the Shares (before deducting expenses)
received by the Company and the total underwriting discounts and commissions
received by the Underwriters, in each case as set forth in the table on the
cover of the Prospectus, bear to the aggregate Public Offering Price of the
Shares. The relative fault of the Company on the one hand and the Underwriters
on the other hand shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company or by the Underwriters and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Underwriters' respective obligations to contribute
pursuant to this Section 8 are several in proportion to the respective number of
Shares they have purchased hereunder, and not joint.
(e) The Company and the Underwriters agree that it would not be just or
equitable if contribution pursuant to this Section 8 were determined by pro rata
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation that does not take account of the
equitable considerations referred to in Section 8(d). The amount paid or payable
by an indemnified party as a result of the losses, claims, damages and
liabilities referred to in the immediately preceding paragraph shall be deemed
to include, subject to the limitations set forth above, any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 8, no Underwriter shall be required to contribute any
amount in excess of the amount by which the total price at which the Shares
underwritten by it and distributed to the public were offered to the public
exceeds the amount of any damages that such Underwriter has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. The remedies
provided for in this Section 8 are not exclusive and shall not limit any rights
or remedies which may otherwise be available to any indemnified party at law or
in equity.
(f) The indemnity and contribution provisions contained in Sections 8
and 9 and the representations, warranties and other statements of the Company
contained in this Agreement shall remain operative and in full force and effect
regardless of (i) any termination of this Agreement, (ii) any investigation made
by or on behalf of any Underwriter or any person controlling any Underwriter or
by or on behalf of the Company, its officers or directors or any person
controlling the Company and (iii) acceptance of and payment for any of the
Shares.
9.
(a) The Company agrees to indemnify and hold harmless Xxxxxx Xxxxxxx
and each person, if any, who controls Xxxxxx Xxxxxxx within the meaning of
either Section 15 of the Act or Section 20 of the Exchange Act ("Xxxxxx Xxxxxxx
Entities"), from and
-17-
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against any and all losses, claims, damages and liabilities (including, without
limitation, any legal or other expenses reasonably incurred in connection with
defending or investigating any such action or claim) (i) caused by any untrue
statement or alleged untrue statement of a material fact contained in any
material prepared by or with the consent of the Company for distribution to
Participants in connection with the Directed Share Program, or caused by any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading; (ii)
caused by the failure of any Participant to pay for and accept delivery of
Directed Shares that the Participant has agreed to purchase; or (iii) related
to, arising out of, or in connection with the Directed Share Program other than
losses, claims, damages or liabilities (or expenses relating thereto) that are
finally judicially determined to have resulted from the bad faith or negligence
of Xxxxxx Xxxxxxx Entities.
(b) In case any proceeding (including any governmental investigation)
shall be instituted involving any Xxxxxx Xxxxxxx Entity in respect of which
indemnity may be sought pursuant to Section 9(a), the Xxxxxx Xxxxxxx Entity
seeking indemnity shall promptly notify the Company in writing and the Company,
upon request of the Xxxxxx Xxxxxxx Entity, shall retain counsel reasonably
satisfactory to the Xxxxxx Xxxxxxx Entity to represent the Xxxxxx Xxxxxxx Entity
in such proceeding and shall pay the fees and disbursements of such counsel
related to such proceeding. In any such proceeding, any Xxxxxx Xxxxxxx Entity
shall have the right to retain its own counsel, but the fees and expenses of
such counsel shall be at the expense of such Xxxxxx Xxxxxxx Entity unless (i)
the Company shall have agreed to the retention of such counsel or (ii) the named
parties to any such proceeding (including any impleaded parties) include both
the Company and the Xxxxxx Xxxxxxx Entity and representation of both parties by
the same counsel would be inappropriate due to actual or potential differing
interests between them. The Company shall not, in respect of the legal expenses
of the Xxxxxx Xxxxxxx Entities in connection with any proceeding or related
proceedings the same jurisdiction, be liable for the fees and expenses of more
than one separate firm (in addition to any local counsel) for all Xxxxxx Xxxxxxx
Entities. Any such firm for the Xxxxxx Xxxxxxx Entities shall be designated in
writing by Xxxxxx Xxxxxxx. The Company shall not be liable for any settlement of
any proceeding effected without its written consent, but if settled with such
consent or if there be a final judgment for the plaintiff, the Company agrees to
indemnify the Xxxxxx Xxxxxxx Entities from and against any loss or liability by
reason of such settlement or judgment. Notwithstanding the foregoing sentence,
if at any time a Xxxxxx Xxxxxxx Entity shall have requested the Company to
reimburse it for fees and expenses of counsel as contemplated by the second and
third sentences of this paragraph, the Company agrees that it shall be liable
for any settlement of any proceeding effected without its written consent if (i)
such settlement is entered into more than 30 days after receipt by the Company
of the aforesaid request and (ii) the Company shall not have reimbursed the
Xxxxxx Xxxxxxx Entity in accordance with such request prior to the date of such
settlement. The Company shall not, without the prior written consent of Xxxxxx
Xxxxxxx, effect any settlement of any pending or threatened proceeding in
respect of which any Xxxxxx Xxxxxxx Entity is or could have been a party and
indemnity could have been sought hereunder by such Xxxxxx Xxxxxxx Entity, unless
such settlement includes an unconditional release of the Xxxxxx Xxxxxxx Entities
from all liability on claims that are the subject matter of such proceeding.
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(c) To the extent the indemnification provided for in Section 9(a) is
unavailable to a Xxxxxx Xxxxxxx Entity or insufficient in respect of any losses,
claims, damages or liabilities referred to therein, then the Company, in lieu of
indemnifying the Xxxxxx Xxxxxxx Entity thereunder, shall contribute to the
amount paid or payable by the Xxxxxx Xxxxxxx Entity as a result of such losses,
claims, damages or liabilities in such proportion as is appropriate to reflect
not only the relative benefits received by the Company on the one hand and the
Xxxxxx Xxxxxxx Entities on the other hand from the offering of the Directed
Shares but also the relative fault of the Company on the one hand and of the
Xxxxxx Xxxxxxx Entities on the other hand in connection with the statements or
omissions that resulted in such losses, claims, damages or liabilities, as well
as any other relevant equitable considerations. The relative benefits received
by the Company on the one hand and of the Xxxxxx Xxxxxxx Entities on the other
hand in connection with the offering of the Directed Shares shall be deemed to
be in the same respective proportions as the net proceeds from the offering of
the Directed Shares (before deducting expenses) and the total underwriting
discounts and commissions received by the Xxxxxx Xxxxxxx Entities for the
Directed Shares, bear to the aggregate Public Offering Price of the Shares. If
the loss, claim, damage or liability is caused by an untrue or alleged untrue
statement of a material fact, the relative fault of the Company on the one hand
and the Xxxxxx Xxxxxxx Entities on the other hand shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
or the omission or alleged omission relates to information supplied by the
Company or by the Xxxxxx Xxxxxxx Entities and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
(d) The Company and the Xxxxxx Xxxxxxx Entities agree that it would not
be just or equitable if contribution pursuant to this Section 9 were determined
by pro rata allocation (even if the Xxxxxx Xxxxxxx Entities were treated as one
entity for such purpose) or by any other method of allocation that does not take
account of the equitable considerations referred to in Section 9(c). The amount
paid or payable by the Xxxxxx Xxxxxxx Entities as a result of the losses,
claims, damages and liabilities referred to in the immediately preceding
paragraph shall be deemed to include, subject to the limitations set forth
above, any legal or other expenses reasonably incurred by the Xxxxxx Xxxxxxx
Entities in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 9, no Xxxxxx Xxxxxxx Entity shall
be required to contribute any amount in excess of the amount by which the total
price at which the Directed Shares distributed to the public were offered to the
public exceeds the amount of any damages that such Xxxxxx Xxxxxxx Entity has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. The remedies provided for in this
Section 9 are not exclusive and shall not limit any rights or remedies which may
otherwise be available to any Xxxxxx Xxxxxxx Entity at law or in equity.
(e) The indemnity and contribution provisions contained in this Section
9 shall remain operative and in full force and effect regardless of (i) any
termination of this Agreement, (ii) any investigation made by or on behalf of
any Xxxxxx Xxxxxxx Entity or the Company, its officers or directors or any
person controlling the Company and (iii) acceptance of and payment for any of
the Directed Shares.
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10. The Agreement shall become effective upon the execution and
delivery hereof by the parties hereto.
(a) If any Underwriter shall default in its obligation to purchase the
Shares that it has agreed to purchase hereunder at a Time of Delivery, you may
in your discretion arrange for you or another party or other parties to purchase
such Shares on the terms contained herein. If within thirty-six hours after such
default by any Underwriter, you notify the Company that you have so arranged for
the purchase of such Shares, you shall have the right to postpone such Time of
Delivery for a period of not more than seven days, in order to effect whatever
changes may thereby be made necessary in the Registration Statement or the
Prospectus, or in any other documents or arrangements, and the Company agrees to
file promptly any amendments to the Registration Statement or the Prospectus
that may be required. The term "Underwriter" as used in this Agreement shall
include any person substituted under this Section with like effect as if such
person had originally been a party to this Agreement with respect to such
Shares.
(b) If, after giving effect to any arrangements for the purchase of the
Shares of a defaulting Underwriter or Underwriters as provided in subsection (a)
above, the aggregate number of such Shares that remains unpurchased does not
exceed 10% of the aggregate number of all the Shares to be purchased at such
Time of Delivery, then the Company shall have the right to require each
non-defaulting Underwriter to purchase the number of Shares that such
Underwriter agreed to purchase hereunder at such Time of Delivery and, in
addition, to require each non-defaulting Underwriter to purchase its pro rata
share (based on the number of Shares that such Underwriter agreed to purchase
hereunder) of the Shares of such defaulting Underwriter or Underwriters for
which such arrangements have not been made; but nothing herein shall relieve a
defaulting Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the purchase of the
Shares of a defaulting Underwriter or Underwriters by you as provided in
subsection (a) above, the aggregate number of such Shares that remains
unpurchased exceeds 10% of the aggregate number of all the Shares to be
purchased at such Time of Delivery, or if the Company shall not exercise the
right described in subsection (b) above to require non-defaulting Underwriters
to purchase Shares of a defaulting Underwriter or Underwriters, then this
Agreement (or, with respect to the Second Time of Delivery, the obligations of
the Underwriters to purchase and of the Company to sell the Optional Shares)
shall thereupon terminate, without liability on the part of any non-defaulting
Underwriter or the Company, except for the expenses to be borne by the Company
and the Underwriters as provided in Section 6 hereof and the indemnity agreement
in Sections 8 and 9 hereof; but nothing herein shall relieve a defaulting
Underwriter from liability for its default.
11. If this Agreement shall be terminated pursuant to Section 10
hereof, the Company shall not be under any liability to any Underwriter except
as provided in Section 6, Section 8 and Section 9 hereof; but, if for any other
reason any Shares are not delivered by or on behalf of the Company as provided
herein, the Company will reimburse the Underwriters through you for all
out-of-pocket expenses approved in writing by you, including fees and
disbursements of counsel, reasonably incurred by the
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Underwriters in making preparations for the purchase, sale and delivery of the
Shares not so delivered, but the Company shall then be under no further
liability to any Underwriter in respect of the Shares not so delivered except as
provided in Section 6, 8 and 9 hereof.
12. All statements, requests, notices and agreements hereunder shall be
in writing, and if to the Underwriters shall be delivered or sent by mail to you
as the representatives in care of Xxxxxx Xxxxxxx, at 0000 Xxxxxxxx, Xxx Xxxx,
X.X. 00000, Xxxxxxxxx: Registration Department; and if to the Company shall be
delivered or sent by mail or facsimile transmission to the address of the
Company set forth in the Registration Statement, Attention: Secretary; provided,
however, that any notice to an Underwriter pursuant to Section 8(a) hereof shall
be delivered or sent by mail or facsimile transmission to such Underwriter at
its address or facsimile number set forth in its Underwriters' Questionnaire or
telex constituting such Questionnaire, which address or facsimile number will be
supplied to the Company by you upon request. Any such statements, requests,
notices or agreements shall take effect upon receipt thereof.
This Agreement shall be binding upon, and inure solely to the benefit
of, the Underwriters, the Company and, to the extent provided in Sections 8 and
9 hereof, the officers and directors of the Company, and each person who
controls the Company or any Underwriter, and their respective heirs, executors,
administrators, successors and assigns, and no other person shall acquire or
have any right under or by virtue of this Agreement. No purchaser of any of the
Shares from any Underwriter shall be deemed a successor or assign by reason
merely of such purchase.
As used herein, the term "business day" shall mean any day when the
Commission's office in Washington, D.C. is open for business.
This Agreement shall be governed by and construed in accordance with
the laws of the State of New York.
This Agreement may be executed by any one or more of the parties hereto
in any number of counterparts, each of which shall be deemed to be an original,
but all such counterparts shall together constitute one and the same instrument.
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If the foregoing is in accordance with your understanding, please sign
and return to us eight counterparts hereof, and upon the acceptance hereof by
you, on behalf of each of the Underwriters, this letter and such acceptance
hereof shall constitute a binding agreement among each of the Underwriters and
the Company. It is understood that your acceptance of this letter on behalf of
each of the Underwriters is pursuant to the authority set forth in a form of
Agreement among Underwriters the form of which shall be submitted to the Company
for examination, upon request, but without warranty on your part as to the
authority of the signers thereof.
Very truly yours,
DUKE ENERGY FIELD SERVICES CORPORATION
By:
-----------------------------------
Name:
The foregoing Underwriting Agreement
is hereby confirmed and accepted
as of the date first above written.
XXXXXX XXXXXXX & CO. INCORPORATED
By: XXXXXX XXXXXXX & CO. INCORPORATED
By:
---------------------------------
On behalf of each of the several Underwriters
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SCHEDULE I
NUMBER OF OPTIONAL
SHARES TO BE
TOTAL NUMBER OF PURCHASED IF
FIRM SHARES TO BE MAXIMUM OPTION
UNDERWRITER PURCHASED EXERCISED
--------------------------------- ----------------- ------------------
Xxxxxx Xxxxxxx & Co. Incorporated
Xxxxxxx Lynch, Pierce, Xxxxxx &
Xxxxx Incorporated
XX Xxxxxx
Xxxxxx Brothers
Xxxxx Xxxxxx
Xxxxxx Xxxxxxx
Dresdner Kleinwort Xxxxxx
X.X. Xxxxxxx & Sons, Inc.
First Union Securities, Inc.
Xxxxxx, Weil Labouisse,
Xxxxxxxxx Inc.
Xxxxxx X. Xxxxx & Co., L.P.
UBS Warburg
Xxxxxxxx & Partners, L.P.
Xxxx Xxxxxxxx Xxxxxxx
Toronto Dominion Securities
Wachovia Securities
------------- -------------
Total
============= =============
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EXHIBIT A
[FORM OF LOCK-UP AGREEMENT]
________________, 2000
Xxxxxx Xxxxxxx & Co. Incorporated
As representative of the several Underwriters named in Schedule I hereto,
c/o Morgan Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Dear Sirs and Mesdames:
The undersigned understands that Xxxxxx Xxxxxxx & Co. Incorporated
("XXXXXX XXXXXXX") proposes to enter into an Underwriting Agreement (the
"UNDERWRITING AGREEMENT") with Duke Energy Field Services Corporation, a
Delaware corporation (the "COMPANY") providing for the public offering (the
"PUBLIC OFFERING") by the several Underwriters, including Xxxxxx Xxxxxxx (the
"UNDERWRITERS"), of an aggregate of 26,300,000 shares (the "Firm Shares") and,
at the election of the Underwriters, up to 3,945,000 additional shares (the
"Optional Shares") of Common Stock (par value $.01 per share) (the "Stock") of
the Company.
To induce the Underwriters that may participate in the Public Offering
to continue their efforts in connection with the Public Offering, the
undersigned hereby agrees that, without the prior written consent of Xxxxxx
Xxxxxxx on behalf of the Underwriters, it will not, during the period commencing
on the date hereof and ending 180 days after the date of the final prospectus
relating to the Public Offering (the "PROSPECTUS") (1) offer, pledge, sell,
contract to sell, sell any option or contract to purchase, purchase any option
or contract to sell, grant any option, right or warrant to purchase, lend, or
otherwise transfer or dispose of, directly or indirectly, any shares of Common
Stock or any securities convertible into or exercisable or exchangeable for
Common Stock or (2) enter into any swap or other arrangement that transfers to
another, in whole or in part, any of the economic consequences of ownership of
Common Stock, whether any such transaction described in clause (1) or (2) above
is to be settled by delivery of Common Stock or such other securities, in cash
or otherwise. The foregoing sentence shall not apply to (a) the sale of any
Shares to the Underwriters pursuant to the Underwriting Agreement or (b)
transactions relating to shares of Common Stock or other securities acquired in
open market transactions after the completion of the Public Offering. In
addition, the undersigned agrees that, without the prior written consent of
Xxxxxx Xxxxxxx on behalf of the Underwriters, it will not, during the period
commencing on the date hereof and ending 180 days after the date of the
Prospectus, make any demand for or exercise any right with respect to, the
registration of any shares of Common Stock or any security convertible into or
exercisable or exchangeable for Common Stock.
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Whether or not the Public Offering actually occurs depends on a number
of factors, including market conditions. Any Public Offering will only be made
pursuant to an Underwriting Agreement, the terms of which are subject to
negotiation between the Company and the Underwriters.
Very truly yours,
------------------------------
(Name)
------------------------------
(Address)
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SCHEDULE II
PERSONS TO SIGN LOCK UP AGREEMENTS
Duke Energy Corporation
Xxxxxxxx Petroleum Company
Xxx X. Xxxx
Xxxx X. Xxxxxxxx
Xxxxx X. Xxxxxxxx
Xxxx X. Xxxxx
Xxxxxxx X. Xxxxxxx
Xxxxxxx X. Priory
[other directors, officers and stockholders of DEFS]
[Option or Restricted Stock Award holders]
[N.B. Directed Share Program Participants will be subject to the lock up
provisions of the DSP materials.]
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