Ex. 4.4
VECTREN CAPITAL, CORP.
$25,000,000 4.99% Guaranteed Senior
Notes, Series A due 2010
$25,000,000 5.13% Guaranteed Senior
Notes, Series B due 2012
$75,000,000 5.31% Guaranteed Senior
Notes, Series C due 2015
Unconditionally Guaranteed
by
VECTREN CORPORATION
NOTE PURCHASE AGREEMENT
Dated as of: October 11,
2005
TABLE OF CONTENTS
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1.
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AUTHORIZATION
OF NOTES.
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2.
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SALE AND
PURCHASE OF NOTES.
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4.
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CONDITIONS TO
CLOSING.
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4.1 Representations and Warranties.
4.2 Performance; No Default.
4.3 Compliance Certificates.
4.5 Purchase Permitted By Applicable Law,
etc.
4.7 Payment of Special Counsel Fees.
4.8 Private Placement Numbers.
4.9 Changes in Corporate Structure.
4.10 Funding Instructions.
4.11 Proceedings and Documents.
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5.
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REPRESENTATIONS
AND WARRANTIES OF THE OBLIGORS.
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5.1 Organization; Power and Authority.
5.4 Organization and Ownership of Shares of
Subsidiaries; Affiliates.
5.5 Financial Statements.
5.6 Compliance with Laws, Other Instruments,
etc.
5.7 Governmental Authorizations, etc.
5.8 Litigation; Observance of Agreements, Statutes
and Orders.
5.10 Title to Property; Leases.
5.11 Licenses, Permits, etc.
5.12 Compliance with ERISA.
5.13 Private Offering by the Company.
5.14 Use of Proceeds; Margin Regulations.
5.15 Existing Indebtedness; Future Liens.
5.16 Foreign Assets Control Regulations and Foreign
or Enemy Status.
5.17 Status under Certain Statutes.
5.18 Environmental Matters.
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6.
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REPRESENTATIONS
OF THE PURCHASER.
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6.1 Purchase for Investment.
7.1 Financial and Business Information.
7.2 Officer’s Certificate.
7.4 Information Required by Rule 144A.
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8.
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PREPAYMENT OF
THE NOTES.
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8.2 Optional Prepayments with Make-Whole
Amount.
8.3 Allocation of Certain Partial
Prepayments.
8.4 Maturity; Surrender, etc.
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9.
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AFFIRMATIVE
COVENANTS.
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9.3 Maintenance of Properties.
9.4 Payment of Taxes and Claims.
9.5 Corporate Existence, etc.
10.1 Transactions with Affiliates.
10.2 Merger, Consolidation, etc.
10.4 Terrorism Sanctions Regulations.
11.2 Successors and Assigns.
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13.
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REMEDIES ON
DEFAULT, ETC.
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13.4 No Waivers or Election of Remedies, Expenses,
etc.
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14.
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REGISTRATION;
EXCHANGE; SUBSTITUTION OF NOTES.
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14.1 Registration of Notes.
14.2 Transfer and Exchange of Notes.
14.3 Replacement of Notes.
15.2 Home Office Payment.
16.1 Transaction Expenses.
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17.
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SURVIVAL OF
REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT.
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18.
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AMENDMENT AND
WAIVER.
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18.2 Solicitation of Holders of Notes.
18.3 Binding Effect, etc.
18.4 Notes held by Obligor, etc.
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20.
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REPRODUCTION OF
DOCUMENTS.
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21.
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CONFIDENTIAL
INFORMATION.
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22.
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SUBSTITUTION OF
PURCHASER.
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23.1 Successors and Assigns.
23.2 Payments Due on Non-Business Days.
SCHEDULE
A -- Information Relating to Purchasers
SCHEDULE
B -- Defined Terms
SCHEDULE
5.4 -- Organization and Ownership of Shares of
Subsidiaries; Affiliates
SCHEDULE
5.11 -- Patents, etc.
SCHEDULE
5.15 -- Existing Indebtedness
EXHIBIT
1-A
-- Form of 4.99% Guaranteed Senior Notes, Series A
due 2010
EXHIBIT
1-B
-- Form of 5.13% Guaranteed Senior Notes, Series B
due 2012
EXHIBIT
1-C
-- Form of 5.31% Guaranteed Senior Notes, Series C
due 2015
EXHIBIT
4.4(a)(i) -- Form of Opinion of Counsel for the Company and
the Guarantor
EXHIBIT
4.4(a)(ii) -- Form of Opinion of Special Counsel for the
Company
EXHIBIT
4.4(a)(iii) -- Form of Opinion of Ohio Counsel for the
Company
EXHIBIT
4.4(b) -- Form of Opinion of Special Counsel for the
Purchasers
VECTREN CAPITAL, CORP.
One Vectren Square
Evansville, Indiana 47708
$25,000,000 4.99% Guaranteed Senior
Notes, Series A due 2010
$25,000,000 5.13% Guaranteed Senior
Notes, Series B due 2012
$75,000,000 5.31% Guaranteed Senior
Notes, Series C due 2015
Unconditionally Guaranteed
by
VECTREN CORPORATION
As of October 11, 2005
TO EACH OF THE
PURCHASERS LISTED IN
VECTREN CAPITAL, CORP., an Indiana corporation
(the “ Company ”), and VECTREN
CORPORATION, an Indiana corporation (“
Vectren ” and, together with the Company,
the “ Obligors ”), agree with each of
the purchasers whose names appear at the end hereof (each, a
“Purchaser” and, collectively, the
“Purchasers” ) as follows:
The Company will authorize the issue and sale,
in three series, of $125,000,000 aggregate principal amount of its
senior notes, of which $25,000,000 aggregate principal amount shall
be its 4.99% Guaranteed Senior Notes, Series A due 2010 (the
“Series A Notes” ), $25,000,000
aggregate principal amount shall be its 5.13% Guaranteed Senior
Notes, Series B due 2012 (the “Series B
Notes” ) and $75,000,000 aggregate principal amount
shall be its 5.31% Guaranteed Senior Notes, Series C due 2015 (the
“Series C Notes” , and together with
the Series A Notes and the Series B Notes, the
“Notes” , such term to include any
such notes issued in substitution therefor pursuant to Section 14.
The Series A Notes, the Series B Notes and the Series C Notes shall
be substantially in the forms set out in Exhibits 1-A, Exhibits 1-B
and 1-C, respectively. Due and punctual payment of the Guaranteed
Obligations (as defined herein) will be unconditionally guaranteed
by Vectren (the “Guarantee” ) as set
forth in this Agreement. Certain capitalized terms used in this
Agreement are defined in Schedule B; references to a
“Schedule” or an “Exhibit” are, unless
otherwise specified, to a Schedule or an Exhibit attached to this
Agreement.
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2.
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SALE
AND PURCHASE OF NOTES.
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Subject to the terms and conditions of this
Agreement, the Company will issue and sell to each Purchaser, and
each Purchaser will purchase from the Company, at the Closing
provided for in Section 3, Notes of the respective series and in
the principal amount specified opposite such Purchaser’s name
in Schedule A at the purchase price of 100% of the principal amount
thereof. The Purchasers’ obligations hereunder are several
and not joint obligations, and no Purchaser shall have any
liability to any Person for the performance or non-performance of
any obligation by any other Purchaser hereunder.
The sale and purchase of the Notes to be
purchased by each Purchaser shall occur at the offices of Pillsbury
Winthrop Shaw Pittman LLP, 1540 Broadway, New York, New York 10036,
at 10:00 a.m., New York City time, at a closing (the
“Closing” ) on December 15, 2005 or on
such other Business Day thereafter as may be agreed upon by the
Company and the Purchasers. At the Closing the Company will deliver
to each Purchaser the Notes to be purchased by such Purchaser in
the form of a single Note for each series to be purchased by such
Purchaser (or such greater number of Notes in denominations of at
least $1,000,000, or any amount in excess thereof which is an
integral multiple of $250,000, as such Purchaser may request) dated
the date of the Closing and registered in such Purchaser’s
name (or in the name of its nominee), against delivery by such
Purchaser to the Company or its order of immediately available
funds in the amount of the purchase price therefor by wire transfer
of immediately available funds for the account of the Company to
account number 0101481317 at Fifth Third Bank, Evansville, Indiana,
ABA No. 042000314. If at the Closing the Company shall fail to
tender such Notes to any Purchaser as provided above in this
Section 3, or any of the conditions specified in Section 4 shall
not have been fulfilled to such Purchaser’s satisfaction,
such Purchaser shall, at its election, be relieved of all further
obligations under this Agreement, without thereby waiving any
rights such Purchaser may have by reason of such failure or such
nonfulfillment.
Each Purchaser’s obligation to purchase
and pay for the Notes to be sold to such Purchaser at the Closing
is subject to the fulfillment to such Purchaser’s
satisfaction, prior to or at the Closing, of the following
conditions:
4.1
Representations and
Warranties.
The representations and warranties of the
Obligors in this Agreement shall be correct when made and at the
time of the Closing, except for failures to be so correct which
individually or in the aggregate could not reasonably be expected
to result in a Material Adverse Effect; provided, however, that
representations and warranties containing a Material Adverse Effect
or other materiality qualifier shall be correct in all
respects.
4.2
Performance; No
Default.
Each Obligor shall have performed and complied
with all agreements and conditions contained in this Agreement
required to be performed or complied with by it prior to or at the
Closing and after giving effect to the issue and sale of the Notes
(and the application of the proceeds thereof as contemplated by
Section 5.14) no Default or Event of Default shall have occurred
and be continuing. Neither the Company nor Vectren (as applicable)
shall have entered into any transaction since the date of the
Memorandum (as defined herein) that would have been prohibited by
Section 10.1, 10.2, 10.5 or 10.6 hereof had such Sections applied
since such date.
4.3
Compliance
Certificates.
(a)
Officer’s
Certificate . Each
Obligor shall have delivered to such Purchaser an Officer’s
Certificate, dated the date of the Closing, certifying that the
conditions specified in Sections 4.1, 4.2 and 4.9 have been
fulfilled.
(b)
Secretary’s
Certificate . Each
Obligor shall have delivered to such Purchaser a certificate of its
Secretary or Assistant Secretary, dated the date of the Closing,
certifying as to the resolutions attached thereto and other
corporate proceedings relating to the authorization, execution and
delivery of this Agreement and the Notes (in the case of the
Company) and of this Agreement and the Guarantee (in the case of
Vectren).
Such Purchaser shall have received opinions in
form and substance satisfactory to such Purchaser, dated the date
of the Closing ( a ) from (i) Barnes & Thornburg,
Indiana counsel for the Obligors, (ii) Baker & Botts, LLP,
special counsel for the Obligors and (iii) Kegler, Brown, Hill and
Ritter, Ohio counsel for the Obligors, covering the matters set
forth in Exhibits 4.4(a)(i), (ii) and (iii), respectively, and
covering such other matters incident to the transactions
contemplated hereby as such Purchaser or its counsel may reasonably
request (and the Obligors hereby instruct their counsel to deliver
such opinions to the Purchasers) and ( b ) from Pillsbury
Winthrop Shaw Pittman LLP, the Purchasers’ special New York
counsel in connection with such transactions, substantially in the
form set forth in Exhibit 4.4(b) and covering such other matters
incident to such transactions as such Purchaser may reasonably
request.
4.5
Purchase Permitted By
Applicable Law, etc.
On the date of the Closing such
Purchaser’s purchase of Notes shall ( i ) be
permitted by the laws and regulations of each jurisdiction to which
such Purchaser is subject, without recourse to provisions (such as
section 1405(a)(8) of the New York Insurance Law) permitting
limited investments by insurance companies without restriction as
to the character of the particular investment, ( ii
) not violate any applicable law or regulation (including,
without limitation, Regulation T, U or X of the Board of Governors
of the Federal Reserve System) and ( iii ) not subject
such Purchaser to any tax, penalty or liability under or pursuant
to any applicable law or regulation, which law or regulation was
not in effect on the date hereof. If requested by such Purchaser,
such Purchaser shall have received an Officer’s Certificate
from Vectren certifying as to such matters of fact as such
Purchaser may reasonably specify to enable such Purchaser to
determine whether such purchase is so permitted.
Contemporaneously with the Closing the Company
shall sell to each other Purchaser and each other Purchaser shall
purchase the Notes to be purchased by it at the Closing as
specified in Schedule A.
4.7
Payment of Special Counsel
Fees.
Without limiting the provisions of
Section 16.1, the Company shall have paid on or before the
Closing the fees, charges and disbursements of the
Purchasers’ special New York counsel referred to in Section
4.4 to the extent reflected in a statement of such counsel rendered
to the Company at least one Business Day prior to the
Closing.
4.8
Private Placement
Numbers.
A Private Placement Number issued by Standard
& Poor’s CUSIP Service Bureau (in cooperation with the
Securities Valuation Office of the National Association of
Insurance Commissioners) shall have been obtained for each series
of Notes.
4.9
Changes in Corporate
Structure.
Neither Obligor shall have changed its
jurisdiction of incorporation or been a party to any merger or
consolidation or succeeded to all or any substantial part of the
liabilities of any other entity, at any time following the date
hereof.
4.10 Funding
Instructions.
At least three Business Days prior to the date
of the Closing, each Purchaser shall have received written
instructions signed by a Responsible Officer on letterhead of the
Company confirming the information specified in Section 3
including (i) the name and address of the transferee bank,
(ii) such transferee bank’s ABA number and
(iii) the account name and number into which the purchase
price for the Notes is to be deposited.
4.11
Proceedings and
Documents.
All corporate and other proceedings in
connection with the transactions contemplated by this Agreement and
all documents and instruments incident to such transactions shall
be satisfactory to such Purchaser and its special counsel, and such
Purchaser and its special counsel shall have received all such
counterpart originals or certified or other copies of such
documents as such Purchaser or such special counsel may reasonably
request.
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5.
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REPRESENTATIONS AND WARRANTIES OF THE
OBLIGORS.
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Each of the Company and Vectren represents and
warrants to each Purchaser (only to the extent applicable to itself
and, if specified, its Subsidiaries) as follows as of the date
hereof or, if the representation or warranty speaks as of a
different date, as of such date:
5.1
Organization; Power and
Authority.
Each of the Company and Vectren is a corporation
duly organized and validly existing under the laws of its
jurisdiction of incorporation, and is duly qualified as a foreign
corporation and is in good standing in each jurisdiction in which
such qualification is required by law, other than those
jurisdictions as to which the failure to be so qualified or in good
standing could not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect. Each of the Company and
Vectren has the corporate power and authority to own or hold under
lease the properties it purports to own or hold under lease, to
transact the business it transacts and proposes to transact, to
execute and deliver this Agreement and the Notes (in the case of
the Company) and this Agreement and the Guarantee (in the case of
Vectren), and to perform the provisions hereof and
thereof.
This Agreement and the Notes have been duly
authorized by all necessary corporate action on the part of the
Company, and this Agreement constitutes, and upon execution and
delivery thereof each Note will constitute, a legal, valid and
binding obligation of the Company enforceable against the Company
in accordance with its terms, and this Agreement and the Guarantee
have been duly authorized by all necessary corporate action on the
part of Vectren and constitute legal, valid and binding obligations
of Vectren enforceable against Vectren in accordance with their
respective terms, except, in each case, as such enforceability may
be limited by (i) applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the
enforcement of creditors’ rights generally and (ii) general
principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law).
The Company and Vectren, through their agents,
J.P. Morgan Securities Inc. and Wachovia Securities, Inc., have
delivered to each Purchaser a copy of a Private Placement
Memorandum, dated July 2005 (including the SEC Reports incorporated
by reference therein, the "Memorandum" ), relating
to the transactions contemplated hereby. The Memorandum fairly
describes, in all material respects, the general nature of the
business and principal properties of the Company, Vectren and its
Subsidiaries. This Agreement, the Memorandum (including the
financial statements contained in the SEC Reports) and the
documents, certificates or other writings delivered to the
Purchasers by or on behalf of the Company or Vectren, as
applicable, in connection with the transactions contemplated hereby
(this Agreement, the Memorandum and such documents, certificates or
other writings delivered to each Purchaser being referred to,
collectively, as the “Disclosure
Documents” ), taken as a whole, do not contain any
untrue statement of a material fact or omit to state any material
fact necessary to make the statements therein not misleading in
light of the circumstances under which they were made. Except as
disclosed in the Disclosure Documents delivered to the Purchasers
on or prior to the date of this Agreement, since December 31, 2004,
there has been no change in the financial condition, operations,
business, properties or prospects of the Company, Vectren or any
Subsidiary except changes that individually or in the aggregate
would not reasonably be expected to have a Material Adverse Effect.
There is no fact known to the Company or Vectren that would
reasonably be expected to have a Material Adverse Effect that has
not been set forth herein or in the Disclosure
Documents.
5.4
Organization and Ownership
of Shares of Subsidiaries; Affiliates.
(a) Schedule 5.4 contains (except as noted therein)
complete and correct lists of (i) Vectren’s Subsidiaries,
showing, as to each Subsidiary, the correct name thereof, the
jurisdiction of its organization, and the percentage of shares of
each class of its capital stock or similar equity interests
outstanding owned by Vectren and each other Subsidiary, ( ii
) Vectren’s Affiliates, other than Subsidiaries, and (
iii ) Vectren’s directors and senior
officers.
(b) All of the outstanding shares of capital stock
or similar equity interests of each Subsidiary shown in Schedule
5.4 as being owned by Vectren and its Subsidiaries have been
validly issued, are fully paid and nonassessable and are owned by
Vectren or another Subsidiary free and clear of any Lien (except as
otherwise disclosed in Schedule 5.4).
(c) Each Subsidiary identified in Schedule 5.4 is a
corporation or other legal entity duly organized, validly existing
and in good standing under the laws of its jurisdiction of
organization, and is duly qualified as a foreign corporation or
other legal entity and is in good standing in each jurisdiction in
which such qualification is required by law, other than those
jurisdictions as to which the failure to be so qualified or in good
standing could not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect. Each such Subsidiary
has the corporate or other power and authority to own or hold under
lease the properties it purports to own or hold under lease and to
transact the business it transacts and proposes to
transact.
(d) No Subsidiary is a party to, or otherwise
subject to any legal, regulatory, contractual, or other restriction
(other than the agreements listed on Schedule 5.4 and customary
limitations imposed by corporate law and fraudulent conveyance
statutes or similar statutes and applicable restrictions contained
in section 305(a) of the Federal Power Act, as amended),
restricting the ability of such Subsidiary to pay dividends out of
profits or make any other similar distributions of profits to
Vectren or any of its Subsidiaries that owns outstanding shares of
capital stock or similar equity interests of such
Subsidiary.
5.5
Financial
Statements.
Vectren has delivered to each Purchaser copies
of (i) the audited financial statements of Vectren and Vectren
Utility Holdings for the years ended December 31, 2002, 2003 and
2004 and (ii) the unaudited financial statements of Vectren and
Vectren Utility Holdings for the three-month periods ended March
31, 2005 and 2004. All of said financial statements and all of the
financial statements included in the SEC Reports (including in each
case the related schedules and notes) fairly present, or will
fairly present, in all material respects the consolidated financial
position of Vectren and its Subsidiaries and Vectren Utility
Holdings as of the respective dates specified in such financial
statements and the consolidated results of their operations and
cash flows for the respective periods so specified and have been or
will be prepared in accordance with U.S. GAAP consistently applied
throughout the periods involved except as set forth in the notes
thereto (subject, in the case of any interim financial statements,
to normal year-end adjustments). Vectren and its Subsidiaries do
not have any Material liabilities that are not disclosed on such
financial statements or otherwise disclosed in the Disclosure
Documents.
5.6
Compliance with Laws, Other
Instruments, etc.
The execution, delivery and performance by the
Company of this Agreement and the Notes and by Vectren of this
Agreement and the Guarantee will not ( i ) contravene,
result in any breach of, or constitute a default under, or result
in the creation of any Lien in respect of any property of the
Company or Vectren, as the case may be, or any Subsidiary, under
any indenture, mortgage, deed of trust, loan, purchase or credit
agreement, lease, corporate charter or by-laws, or any other
agreement or instrument to which the Company, Vectren or any
Subsidiary is bound or by which the Company, Vectren or any
Subsidiary or any of their respective properties may be bound or
affected, ( ii ) conflict with or result in a breach of any
of the terms, conditions or provisions of any order, judgment,
decree, or ruling of any court, arbitrator or Governmental
Authority applicable to the Company, Vectren or any Subsidiary or (
iii ) violate any provision of any statute or other rule or
regulation of any Governmental Authority applicable to the Company,
Vectren or any Subsidiary (including, without limitation, PUHCA or
the Federal Power Act, as amended).
5.7
Governmental Authorizations,
etc.
No consent, approval or authorization of, or
registration, filing or declaration with, any Governmental
Authority is required in connection with the execution, delivery or
performance by the Company of this Agreement or the Notes or by
Vectren of this Agreement or the Guarantee (including, without
limitation, any thereof under PUHCA, the Natural Gas Act or the
Federal Power Act, each as amended).
5.8
Litigation; Observance of
Agreements, Statutes and Orders.
(a) Except as disclosed as of the date hereof in the
Memorandum, there are no actions, suits, investigations or
proceedings pending or, to the knowledge of the Company or Vectren,
threatened against or affecting the Company, Vectren or any
Subsidiary or any property of the Company, Vectren or any
Subsidiary in any court or before any arbitrator of any kind or
before or by any Governmental Authority that, individually or in
the aggregate, could reasonably be expected to have a Material
Adverse Effect.
(b) None of the Company, Vectren or any Subsidiary
is in default under any term of any agreement or instrument to
which it is a party or by which it is bound, or any order,
judgment, decree or ruling of any court, arbitrator or Governmental
Authority or is in violation of any applicable law, ordinance, rule
or regulation (including without limitation Environmental Laws or
the USA Patriot Act) of any Governmental Authority, which default
or violation, individually or in the aggregate, could reasonably be
expected to have a Material Adverse Effect.
Vectren and each Subsidiary have filed all tax
returns that are required to have been filed in any jurisdiction,
and have paid all taxes shown to be due and payable on such returns
and all other taxes and assessments levied upon them or their
properties, assets, income or franchises, to the extent such taxes
and assessments have become due and payable and before they have
become delinquent, except for any taxes and assessments ( i
) the amount of which is not individually or in the aggregate
Material or ( ii ) the amount, applicability or validity of
which is currently being contested in good faith by appropriate
proceedings and with respect to which Vectren or a Subsidiary, as
the case may be, has established adequate reserves in accordance
with U.S. GAAP. Vectren does not know of any basis for any other
tax or assessment that would have a Material Adverse Effect. The
charges, accruals and reserves on the books of Vectren and its
Subsidiaries in respect of taxes for all fiscal periods are
adequate. The Federal income tax liabilities of Indiana Energy,
Inc. and its Subsidiaries, a predecessor of Vectren, and SIGCORP,
Inc and its Subsidiaries, a predecessor of Vectren, have been
finally determined (whether by reason of completed audits or the
statute of limitations having run) for all fiscal years up to and
including the fiscal year ended March 31, 2000 and December 31,
1999, respectively.
5.10
Title to Property;
Leases.
Vectren and each Subsidiary have good and
sufficient title to their respective properties that individually
or in the aggregate are Material, including all such properties
reflected in the most recent audited balance sheets referred to in
Section 5.5 or purported to have been acquired by Vectren or any
Subsidiary after said date (except as sold or otherwise disposed of
in the ordinary course of business), in each case free and clear of
Liens prohibited by this Agreement (in the case of the Company) or
that individually or in the aggregate are Material (in the case of
Vectren and any other Subsidiary). All leases that Vectren or any
Subsidiary is party to as lessee and that individually or in the
aggregate are Material are valid and subsisting and are in full
force and effect in all material respects.
5.11
Licenses, Permits,
etc.
Except as disclosed in Schedule 5.11,
(a) Vectren and each Subsidiary own or possess all
licenses, permits, franchises, authorizations, patents, copyrights,
proprietary software, service marks, trademarks and trade names, or
rights thereto, that individually or in the aggregate are Material,
without known conflict with the rights of others;
(b) to the best knowledge of Vectren, no product of
Vectren or any Subsidiary infringes in any material respect any
license, permit, franchise, authorization, patent, copyright,
proprietary software, service mark, trademark, trade name or other
right owned by any other Person; and
(c) to the best knowledge of Vectren, there is no
Material violation by any Person of any right of Vectren or any
Subsidiary with respect to any patent, copyright, proprietary
software, service mark, trademark, trade name or other right owned
or used by Vectren or any Subsidiary.
5.12
Compliance with
ERISA.
(a) Vectren and each ERISA Affiliate have operated
and administered each Plan in compliance with all applicable laws
except for such instances of noncompliance as have not resulted in
and could not reasonably be expected to result in a Material
Adverse Effect. Neither Vectren nor any ERISA Affiliate has
incurred any liability pursuant to Title I or IV of ERISA or the
penalty or excise tax provisions of the Code relating to employee
benefit plans (as defined in section 3 of ERISA), and no event,
transaction or condition has occurred or exists that could
reasonably be expected to result in the incurrence of any such
liability by Vectren or any ERISA Affiliate, or in the imposition
of any Lien on any of the rights, properties or assets of Vectren
or any ERISA Affiliate, in either case pursuant to Title I or IV of
ERISA or to such penalty or excise tax provisions or to section
401(a)(29) or 412 of the Code or section 4068 of ERISA, other than
such liabilities or Liens as would not be individually or in the
aggregate Material.
(b) The present value of the aggregate benefit
liabilities under each of the Plans (other than Multiemployer
Plans), determined as of the end of such Plan’s most recently
ended plan year on the basis of the actuarial assumptions specified
for funding purposes in such Plan’s most recent actuarial
valuation report, did not exceed the aggregate current value of the
assets of such Plan allocable to such benefit liabilities by more
than $85,000,000. The term “ benefit
liabilities ” has the meaning specified in section
4001 of ERISA and the terms “current value” and
“present value” have the meaning specified in section 3
of ERISA.
(c) Vectren and its ERISA Affiliates have not
incurred withdrawal liabilities (and are not subject to contingent
withdrawal liabilities) under section 4201 or 4204 of ERISA in
respect of Multiemployer Plans that individually or in the
aggregate are Material.
(d) The expected postretirement benefit obligation
(determined as of the last day of Vectren’s most recently
ended fiscal year in accordance with Financial Accounting Standards
Board Statement No. 106, without regard to liabilities attributable
to continuation coverage mandated by section 4980B of the Code) of
Vectren and its Subsidiaries is not in an amount which could
reasonably be expected to result in a Material Adverse
Effect.
(e) The execution and delivery of this Agreement and
the issuance and sale of the Notes hereunder will not involve any
transaction that is subject to the prohibitions of section 406 of
ERISA or in connection with which a tax could be imposed pursuant
to section 4975(c)(1)(A)-(D) of the Code. The representation by
Vectren to each Purchaser in the first sentence of this Section
5.12(e) is made in reliance upon and subject to the accuracy of
such Purchaser’s representation in Section 6.2 as to the
sources of the funds used to pay the purchase price of the Notes to
be purchased by such Purchaser.
5.13
Private Offering by the
Company.
Neither the Company nor anyone acting on its
behalf has offered the Notes or any similar securities for sale to,
or solicited any offer to buy any of the same from, or otherwise
approached or negotiated in respect thereof with, any Person other
than the Purchasers and not more than 30 other Institutional
Investors, each of which has been offered the Notes at a private
sale for investment. Neither the Company nor anyone acting on its
behalf has taken, or will take, any action that would subject the
issuance or sale of the Notes to the registration requirements of
Section 5 of the Securities Act or to the registration requirements
of any securities or blue sky laws of any applicable
jurisdiction.
5.14
Use of Proceeds; Margin
Regulations.
The Company will apply the proceeds of the sale
of the Notes to repay certain existing indebtedness of the Company
and for general corporate purposes. No part of the proceeds from
the sale of the Notes hereunder will be used, directly or
indirectly, for the purpose of buying or carrying any margin stock
within the meaning of Regulation G of the Board of Governors of the
Federal Reserve System (12 CFR 221), or for the purpose of buying
or carrying or trading in any securities under such circumstances
as to involve the Company in a violation of Regulation X of said
Board (12 CFR 224) or to involve any broker or dealer in a
violation of Regulation T of said Board (12 CFR 220). Margin stock
does not constitute more than 10% of the value of the consolidated
assets of Vectren and its Subsidiaries and Vectren does not have
any present intention that margin stock will constitute more than
10% of the value of such assets. As used in this Section, the terms
“margin stock” and
“purpose of buying or carrying” shall
have the meanings assigned to them in said Regulation U.
5.15
Existing Indebtedness;
Future Liens.
(a) Vectren’s annual report on Form 10-K for
the year ended December 31, 2004 sets forth a complete and correct
list of all outstanding Indebtedness of Vectren and its
Subsidiaries as of its date (including a description of the
obligors and obligees, principal amount outstanding and collateral
therefor, if any, and Guaranty thereof, if any). Since December 31,
2004 there has been no Material change in the amounts, interest
rates, sinking funds, installment payments or maturities of the
Indebtedness of Vectren or its Subsidiaries, except as disclosed in
Schedule 5.15. None of the Company, Vectren or any Subsidiary is in
default, and no waiver of default is currently in effect, in the
payment of any principal or interest on any Indebtedness of the
Company, Vectren or such Subsidiary and no event or condition
exists with respect to any Indebtedness of the Company, Vectren or
any Subsidiary that would permit (or that with notice or the lapse
of time, or both, would permit) one or more Persons to cause such
Indebtedness to become due and payable before its stated maturity
or before its regularly scheduled dates of payment.
(b) Except as disclosed in Schedule 5.15, none of
the Company, Vectren or any Subsidiary has agreed or consented to
cause or permit in the future (upon the happening of a contingency
or otherwise) any of its property, whether now owned or hereafter
acquired, to be subject to a Lien not permitted by Section
10.5.
(c) Neither the Company, Vectren nor any Subsidiary
is a party to, or otherwise subject to any provision contained in,
any instrument evidencing Indebtedness of the Company, Vectren or
such Subsidiary, as applicable, any agreement relating thereto or
any other agreement (including, but not limited to, its charter or
other organizational document) which limits the amount of, or
otherwise imposes restrictions on the incurring of, Indebtedness of
the Company or Vectren, as applicable, except as specifically
indicated in Schedule 5.15.
5.16
Foreign Assets Control
Regulations and Foreign or Enemy Status.
(a) Neither the sale of the Notes by the Company
hereunder nor the Company’s use of the proceeds thereof nor
the issuance by Vectren of the Guarantee will violate the Trading
with the Enemy Act, as amended, or any of the foreign assets
control regulations of the United States Treasury Department (31
CFR, Subtitle B, Chapter V, as amended) or any enabling legislation
or executive order relating thereto.
(b) None of the Company, Vectren or any Subsidiary
(i) is a Person described or designated in the Specially
Designated Nationals and Blocked Persons List of the Office of
Foreign Assets Control or in Section 1 of the Anti-Terrorism
Order or (ii) engages in any dealings or transactions with any
such Person. The Company, Vectren and its Subsidiaries are in
compliance, in all material respects, with the USA Patriot
Act.
(c) No part of the proceeds from the sale of the
Notes hereunder will be used, directly or indirectly, for any
payments to any governmental official or employee, political party,
official of a political party, candidate for political office, or
anyone else acting in an official capacity, in order to obtain,
retain or direct business or obtain any improper advantage, in
violation of the United States Foreign Corrupt Practices Act of
1977, as amended, assuming in all cases that such Act applies to
the Company and Vectren and its Subsidiaries.
5.17
Status under Certain
Statutes.
None of the Company, Vectren or any Subsidiary
is subject to regulation under the Investment Company Act of 1940,
as amended or the ICC Termination Act of 1995, as amended. Each of
Vectren and Vectren Utility Holdings is a “Holding
Company” as defined in PUHCA. Pursuant to §3(a)(1) and
§3(c) of PUHCA, Vectren and its Subsidiaries are exempt from
registration under PUHCA. Vectren and its Subsidiaries are exempt
from regulation by the Federal Energy Regulatory Commission under
Sections 1(b) and 1(c) of the Natural Gas Act, as amended. Except
as disclosed in the Memorandum as of the date hereof, no change in
circumstances has occurred subsequent to the effectiveness of
Release No. 35-27239; 70 9703 dated October 4, 2000 of the United
States Securities and Exchange Commission that would cause Vectren
or any of its Subsidiaries to cease to qualify for exemption from
registration pursuant to §3(a)(1) and §3(c) of PUHCA or
cause the gas distribution operations of Vectren and its
Subsidiaries to cease to qualify for exemption from regulation
under Sections 1(b) and 1(c) of the Natural Gas Act, as
amended.
5.18
Environmental
Matters.
(a) Neither Vectren nor any Subsidiary has knowledge
of any claim or has received any notice of any claim, and no
proceeding has been instituted raising any claim against Vectren or
any Subsidiary or any of their respective real properties now or
formerly owned, leased or operated by any of them or other assets,
alleging any damage to the environment or violation of any
Environmental Laws, except, in each case, such as has been
disclosed in the Memorandum as of the date hereof or such as could
not reasonably be expected to result in a Material Adverse
Effect.
(b) Neither Vectren nor any Subsidiary has knowledge
of any facts which would give rise to any claim, public or private,
of violation of Environmental Laws or damage to the environment
emanating from, occurring on or in any way related to real
properties now or formerly owned, leased or operated by any of them
or to other assets or their use, except, in each case, such as
could not reasonably be expected to result in a Material Adverse
Effect;
(c) Neither Vectren nor any Subsidiary has stored
any Hazardous Materials on real properties now or formerly owned,
leased or operated by any of them and has not disposed of any
Hazardous Materials in a manner contrary to any Environmental Laws
in each case in any manner that could reasonably be expected to
result in a Material Adverse Effect; and
(d) All buildings on all real properties now owned,
leased or operated by Vectren or any Subsidiary are in compliance
with applicable Environmental Laws, except where failure to comply
could not reasonably be expected to result in a Material Adverse
Effect.
All liabilities of the Company under the Notes
constitute direct, unconditional and general obligations of the
Company and rank in right of payment either pari
passu with or senior to all other Indebtedness of the
Company. All liabilities of Vectren under the Guarantee constitute
direct, unconditional and general obligations of Vectren and rank
in right of payment either pari passu with or
senior to all other Indebtedness of Vectren.
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6.
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REPRESENTATIONS OF THE
PURCHASER.
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6.1
Purchase for
Investment.
Each Purchaser severally represents that it is
purchasing the Notes for its own account or for one or more
separate accounts maintained by such Purchaser or for the account
of one or more pension or trust funds and not with a view to the
distribution thereof, provided that the disposition of such
Purchaser’s or their property shall at all times be within
such Purchaser’s or their control. Each Purchaser understands
that the Notes have not been registered under the Securities Act
and may be resold only if registered pursuant to the provisions of
the Securities Act or if an exemption from registration is
available, except under circumstances where neither such
registration nor such an exemption is required by law, and that
neither Obligor is required to register the Notes.
Each Purchaser severally represents that at
least one of the following statements is an accurate representation
as to each source of funds (a “Source”) to be used by
such Purchaser to pay the purchase price of the Notes to be
purchased by such Purchaser hereunder:
(a) the Source is an “insurance company
general account” (as the term is defined in PTE 95-60 (issued
July 12, 1995)) in respect of which the reserves and liabilities
(as defined by the annual statement for life insurance companies
approved by the National Association of Insurance Commissioners
(the “ NAIC Annual Statement ”)) for
the general account contract(s) held by or on behalf of any
employee benefit plan together with the amount of the reserves and
liabilities for the general account contract(s) held by or on
behalf of any other employee benefit plans maintained by the same
employer (or affiliate thereof as defined in PTE 95-60) or by the
same employee organization in the general account do not exceed 10%
of the total reserves and liabilities of the general account
(exclusive of separate account liabilities) plus surplus as set
forth in the NAIC Annual Statement filed with such
Purchaser’s state of domicile; or
(b) the Source is a separate account that is
maintained solely in connection with such Purchaser’s fixed
contractual obligations under which the amounts payable, or
credited, to any employee benefit plan (or its related trust) that
has any interest in such separate account (or to any participant or
beneficiary of such plan (including any annuitant)) are not
affected in any manner by the investment performance of the
separate account; or
(c) the Source is either (i) an insurance company
pooled separate account, within the meaning of PTE 90-1 or (ii) a
bank collective investment fund, within the meaning of the PTE
91-38 and, except as disclosed by such Purchaser to the Company in
writing pursuant to this clause (c), no employee benefit plan or
group of plans maintained by the same employer or employee
organization beneficially owns more than 10% of all assets
allocated to such pooled separate account or collective investment
fund; or
(d) the Source constitutes assets of an
“investment fund” (within the meaning of Part V of PTE
84-14 (the “QPAM Exemption” )) managed
by a “qualified professional asset manager” or
“QPAM” (within the meaning of Part V of the QPAM
Exemption), no employee benefit plan’s assets that are
included in such investment fund, when combined with the assets of
all other employee benefit plans established or maintained by the
same employer or by an affiliate (within the meaning of Section
V(c)(1) of the QPAM Exemption) of such employer or by the same
employee organization and managed by such QPAM, exceed 20% of the
total client assets managed by such QPAM, the conditions of Part
I(c) and (g) of the QPAM Exemption are satisfied, neither the QPAM
nor a person controlling or controlled by the QPAM (applying the
definition of “control” in Section V(e) of the QPAM
Exemption) owns a 5% or more interest in the Company and (i) the
identity of such QPAM and (ii) the names of all employee benefit
plans whose assets are included in such investment fund have been
disclosed to the Company in writing pursuant to this clause (d);
or
(e) the Source constitutes assets of a
“plan(s)” (within the meaning of Section IV of PTE
96-23 (the “INHAM Exemption” ))
managed by an “in-house asset manager” or
“INHAM” (within the meaning of Part IV of the INHAM
exemption), the conditions of Part I(a), (g) and (h) of the INHAM
Exemption are satisfied, neither the INHAM nor a person controlling
or controlled by the INHAM (applying the definition of
“control” in Section IV(d) of the INHAM Exemption) owns
a 5% or more interest in the Company and (i) the identity of such
INHAM and (ii) the name(s) of the employee benefit plan(s) whose
assets constitute the Source have been disclosed to the Company in
writing pursuant to this clause (e); or
(f) the Source is a governmental plan; or
(g) the Source is one or more employee benefit
plans, or a separate account or trust fund comprised of one or more
employee benefit plans, each of which has been identified to the
Company in writing pursuant to this clause (g); or
(h) the Source does not include assets of any
employee benefit plan, other than a plan exempt from the coverage
of ERISA.
As used in this
Section 6.2, the terms “employee benefit
plan” , “governmental
plan” , “party in
interest” and “separate
account” shall have the respective meanings assigned
to such terms in Section 3 of ERISA.
7.1
Financial and Business
Information.
Each of the Company and Vectren, as applicable,
shall deliver to each holder of Notes:
(a)
Quarterly Statements
-- within 60 days after the end of
each quarterly fiscal period in each fiscal year of Vectren and its
Subsidiaries (other than the last quarterly fiscal period of each
such fiscal year), as the case may be, duplicate copies
of,
(i) a consolidated unaudited balance sheet of
Vectren and its Subsidiaries (if any) as at the end of such
quarter, and
(ii) consolidated statements of income, retained
earnings and cash flows (and, in the case of Vectren, common
shareholders’ equity) of Vectren and its Subsidiaries (if
any), for such quarter and (in the case of the second and third
quarters) for the portion of the fiscal year ending with such
quarter,
setting forth
in each case in comparative form the figures for the corresponding
periods in the previous fiscal year, all in reasonable detail,
prepared in accordance with U.S. GAAP applicable to quarterly
financial statements generally, and certified by Vectren’s
Chief Financial Officer or Treasurer as fairly presenting, in all
material respects, the financial position of the companies being
reported on and their results of operations and cash flows (and, in
the case of Vectren, common shareholders’ equity), subject to
changes resulting from year-end adjustments, provided that
delivery within the time period specified above of copies of
Vectren’s Quarterly Report on Form 10-Q prepared in
compliance with the requirements therefor and filed with the
Securities and Exchange Commission shall be deemed to satisfy the
requirements of this Section 7.1(a). The documents required
pursuant to this Section 7.1(a) may be delivered electronically
and, if so delivered, shall be deemed to have been delivered on the
date on which Vectren posts such documents, or provides a link
thereto, on EDGAR or a similar service or on its Website at
http://www.vectren.com; provided that (x) upon request of
any holder, Vectren shall deliver paper copies of such documents to
the holder (until a written request to cease delivering paper
copies is given by the holder) and (y) Vectren shall notify (which
may be by facsimile or electronic mail) each holder of the posting
of any documents;
(b)
Annual Statements
-- within 120 days after the end of
each fiscal year of Vectren, duplicate copies of,
(i) a consolidated balance sheet of Vectren and its
Subsidiaries (if any), as at the end of such year, and
(ii) consolidated statements of income, retained
earnings and cash flows (and, in the case of Vectren, common
shareholders’ equity) of Vectren and its Subsidiaries (if
any), for such year,
setting forth
in each case in comparative form the figures for the previous
fiscal year, all in reasonable detail, prepared in accordance with
U.S. GAAP, and accompanied by an opinion thereon of independent
registered public accountants of recognized national standing,
which opinion shall state that such financial statements present
fairly, in all material respects, the financial position of the
companies being reported upon and their results of operations and
cash flows (and, in the case of Vectren, common shareholders’
equity) and have been prepared in conformity with U.S. GAAP, and
that the examination of such accountants in connection with such
financial statements has been made in accordance with generally
accepted auditing standards, and that such audit provides a
reasonable basis for such opinion in the circumstances. The
delivery within the time period specified above of Vectren’s
Annual Report on Form 10-K for such fiscal year (together with
Vectren’s annual report to shareholders, if any, prepared
pursuant to Rule 14a-3 under the Exchange Act) prepared in
accordance with the requirements therefor and filed with the
Securities and Exchange Commission shall be deemed to satisfy the
requirements of this Section 7.1(b). The documents required
pursuant to this Section 7.1(b) may be delivered electronically
and, if so delivered, shall be deemed to have been delivered on the
date on which Vectren posts such documents, or provides a link
thereto, on EDGAR or a similar service or on its Website at
http://www.vectren.com; provided that (x) upon request of
any holder, Vectren shall deliver paper copies of such documents to
the holder (until a written request to cease delivering paper
copies is given by the holder) and (y) Vectren shall notify (which
may be by facsimile or electronic mail) each holder of the posting
of any documents;
(c)
Compliance Certificate
-- together with the financial
statements required under Sections 7.1(a) and (b), a compliance
certificate, signed by its Chief Financial Officer or Treasurer,
showing the calculations necessary to determine compliance with
Sections 10.5 and 10.7 of this Agreement;
(d)
SEC and Other Reports
-- promptly upon the filing thereof,
one copy of (i) each financial statement, report, notice or proxy
statement sent by Vectren or any Subsidiary to public securities
holders generally, and (ii) each regular or periodic report,
each registration statement (without exhibits except as expressly
requested by such holder), except for registration statements
relating to employee benefit plans or dividend reinvestment plans,
and each prospectus and all amendments thereto filed by Vectren or
any Subsidiary with the Securities and Exchange Commission. The
documents required pursuant to this Section 7.1(d) may be delivered
electronically and, if so delivered, shall be deemed to have been
delivered on the date on which Vectren posts such documents, or
provides a link thereto, on EDGAR or a similar service or on its
Website at http://www.vectren.com; provided that (x) upon
request of any holder, Vectren shall deliver paper copies of such
documents to the holder (until a written request to cease
delivering paper copies is given by the holder) and (y) Vectren
shall notify (which may be by facsimile or electronic mail) each
holder of the posting of any documents;
(e)
Notice of Default or Event of
Default -- promptly, and
in any event within ten Business Days after a Responsible Officer
becoming aware of the existence of any Default or Event of Default
which could reasonably be expected to have a Material Adverse
Effect, written notice specifying the nature and period of
existence thereof;
(f)
ERISA Matters
-- promptly, and in any event within
ten Business Days after a Responsible Officer becoming aware that a
Reportable Event has occurred with respect to any Plan, a written
notice, signed by the Chief Financial Officer or Treasurer of
Vectren, setting forth the nature thereof and the action, if any,
that Vectren proposes to take with respect thereto;
(g)
Notices from Governmental
Authority -- promptly,
and in any event within 30 Business Days of receipt thereof, copies
of (a) any notice or claim to the effect that Vectren or any of its
Subsidiaries is or may be liable to any Person as a result of the
release by Vectren, any of its Subsidiaries, or any other Person of
any Hazardous Material into the environment, and (b) any notice
alleging any violation of any Environmental Law by Vectren or any
of its Subsidiaries, which, in either case, could reasonably be
expected to have a Material Adverse Effect; and
(h)
Requested Information
-- subject to the last sentence of
Section 7.3, with reasonable promptness, such other data and
information relating to the business, operations, affairs,
financial condition, assets or properties of the Company, Vectren
or any Subsidiary or relating to the ability of the Obligors to
perform their respective obligations hereunder and under the Notes
and the Guarantee as from time to time may be reasonably requested
by any such holder of Notes.
7.2
Officer’s
Certificate.
Each set of financial statements delivered to a
holder of Notes pursuant to Section 7.1(a) or Section 7.1(b) hereof
shall be accompanied by a certificate of the Chief Financial
Officer or Treasurer of Vectren setting forth a statement that such
officer has reviewed the relevant terms hereof and has made, or
caused to be made, under his or her supervision, a review of the
transactions and conditions of the Company or of Vectren and its
Subsidiaries, as the case may be, from the beginning of the
quarterly or annual period covered by the statements then being
furnished to the date of the certificate and that such review shall
not have disclosed the existence during such period of any
condition or event that constitutes a Default or an Event of
Default or, if any such condition or event existed or exists
(including, without limitation, any such event or condition
resulting from the failure of the Company, Vectren or any
Subsidiary to comply with any Environmental Law), specifying the
nature and period of existence thereof.
The Company and Vectren shall permit the
representatives of each holder of Notes that is an Institutional
Investor:
(a)
No Default
-- if no Default or Event of Default
then exists, at the expense of such holder and upon reasonable
prior notice to Vectren to visit the principal executive office of
Vectren, to discuss the affairs, finances and accounts of Vectren
and the Company and their Subsidiaries with Vectren’s
officers, and (with the consent of Vectren or the Company, as the
case may be, which consent will not be unreasonably withheld) to
visit the other offices and properties of Vectren and its
Subsidiaries, all at such reasonable times and as often as may be
reasonably requested in writing; and
(b)
Default -- if a Default or Event of Default then exists,
at the expense of Vectren, to visit and inspect any of the offices
or properties of Vectren, the Company or any of their respective
Subsidiaries, to examine all their respective books of account,
records, reports and other papers, to make copies and extracts
therefrom, and to discuss their respective affairs, finances and
accounts with their respective officers, all at such times and as
often as may be requested.
7.4
Information Required by Rule
144A.
The Company will, upon the request of the holder
of any Note, provide such holder, and any qualified institutional
buyer designated by such holder, such financial and other
information as such holder may reasonably determine to be necessary
in order to permit compliance with the information requirements of
Rule 144A under the Securities Act in connection with the resale of
Notes, except at such times as the Company is subject to the
reporting requirements of sections 13 or 15(d) of the Exchange Act.
For the purpose of this Section 7.4, the term “
qualified institutional
buyer ” shall have the meaning specified in Rule
144A under the Securities Act.
As provided therein, the entire unpaid principal
amount of the Series A Notes, the Series B Notes and the Series C
Notes shall be due and payable on December 15, 2010, 2012 and 2015,
respectively.
8.2
Optional Prepayments with
Make-Whole Amount.
The Company may, at its option, upon notice as
provided below, prepay at any time all, or from time to time any
part of, any series of the Notes, in an amount not less than 5% of
the aggregate principal amount of the Notes then outstanding in the
case of a partial prepayment, at 100% of the principal amount so
prepaid, and the Make-Whole Amount determined for the prepayment
date with respect to such principal amount. The Company will give
each holder of Notes written notice of each optional prepayment
under this Section 8.2 not less than 30 days and not more than 60
days prior to the date fixed for such prepayment. Each such notice
shall specify such date (which shall be a Business Day), the
aggregate principal amount of the Notes of such series to be
prepaid on such date, the principal amount of each Note held by
such holder to be prepaid (determined in accordance with Section
8.3), and the interest to be paid on the prepayment date with
respect to such principal amount being prepaid, and shall be
accompanied by a certificate of a Senior Financial Officer as to
the estim
