EXHIBIT 1-2
COMMONWEALTH EDISON COMPANY
NOTES
FORM OF UNDERWRITING AGREEMENT
_________ __, 200_
To the Representatives named in
Schedule I hereto of the Underwriters
named in Schedule II hereto
Dear Sirs:
1. Introductory. Commonwealth Edison Company, an Illinois corporation
(the "Company"), proposes to issue and sell from time to time Notes (the
"Notes"). The Notes will be issued by the Company under its Indenture dated as
of September 1, 1987 (under which Citibank, N.A. is the Trustee), as heretofore
amended and supplemented and as to be further supplemented by a Supplemental
Indenture or Supplemental Indentures creating the series in which the Notes are
to be issued. The term "Indenture", as hereinafter used, means such Indenture
dated as of September 1, 1987, as so amended and supplemented. The Company
proposes to sell to the underwriters named in Schedule II hereto (the
"Underwriters") for whom you are acting as Representative or Representatives
(the "Representatives") Notes in the aggregate principal amount and with the
terms specified in Schedule I hereto (the "Purchased Notes").
2. Representations and Warranties of the Company. The Company
represents and warrants to, and agrees with, the Underwriters that:
(a) The Company has filed with the Securities and Exchange
Commission (the "Commission") a registration statement on Form S-3 (Registration
No. 333-_____) relating to its debt securities, which include the Purchased
Notes, first mortgage bonds, trust preferred securities and cumulative
preference stock (the "Securities"), and the offering thereof from time to time
in accordance with Rule 415 under the Securities Act of 1933, as amended (the
"Act"), and has filed such amendments thereto as may have been required to the
date hereof. Such registration statement, as so amended, has been declared
effective by the Commission. Such registration statement and the prospectus
relating to the sale of the Securities by the Company constituting a part
thereof, including all documents incorporated therein by reference, as from time
to time amended or supplemented pursuant to the Act or the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), are referred to herein as the
"Registration Statement," and the prospectus relating to the Securities,
including all documents incorporated therein by reference, as from time to time
amended or supplemented pursuant to the Act or the Exchange Act, is referred to
herein as the "Prospectus"; provided, however, that a supplement to the
Prospectus relating to an offering of Securities, other than the Purchased
Notes, shall be deemed to have supplemented the Prospectus only with respect to
the offering of the other Securities to
which it relates. All documents filed by the Company with the Commission
pursuant to the Exchange Act and incorporated by reference in the Registration
Statement or the Prospectus, as aforesaid, are hereinafter referred to as the
"Incorporated Documents."
(b) The Registration Statement, the Prospectus and the Indenture, at
the time the Registration Statement became effective complied, as of the date
hereof comply and as of the Closing Date (as hereinafter defined) will comply,
in all material respects with the applicable requirements of the Act, the
Exchange Act and the Trust Indenture Act of 1939, as amended (the "Trust
Indenture Act"), and the rules and regulations of the Commission under such
Acts; the Incorporated Documents, as of their respective dates of filing with
the Commission, complied and will comply as to form in all material respects
with the requirements of the Exchange Act and the rules and regulations of the
Commission thereunder; the Registration Statement and any amendment thereof
(including the filing of any annual report on Form 10-K), at the time it became
effective, 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 not misleading; and the Prospectus, at the time the
Registration Statement became effective did not, as of the date hereof does not
and as of the Closing Date will not, contain an untrue statement of a material
fact or omit to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; provided, however, that the representations and warranties in this
Section 1(b) shall not apply to (i) that part of the Registration Statement
which constitutes the Statements of Eligibility and Qualification (Forms T-1 and
T-2) under the Trust Indenture Act or (ii) statements in or omissions from the
Registration Statement or the Prospectus made in reliance upon and in conformity
with information furnished to the Company in writing by any Underwriter
expressly for use in the Registration Statement or the Prospectus.
(c) PricewaterhouseCoopers LLP, the accountants who certified certain
of the financial statements included or incorporated by reference in the
Prospectus, are independent public accountants as required by the Act and the
rules and regulations of the Commission thereunder.
(d) The financial statements included or incorporated by reference in
the Prospectus present fairly in all material respects the financial position,
results of operations and cash flows of the Company at the respective dates and
for the respective periods specified and, except as otherwise stated in the
Prospectus, such financial statements have been prepared in conformity with
generally accepted accounting principles applied on a consistent basis during
the periods involved. The Company has no material contingent obligation which is
not disclosed in the Prospectus.
(e) Except as set forth in or contemplated by the Prospectus, no
material transaction has been entered into by the Company otherwise than in the
ordinary course of business and no materially adverse change has occurred in the
condition, financial or otherwise, of the Company, in each case since the
respective dates as of which information is given in the Prospectus.
2
(f) The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Illinois with
corporate power and authority to own its properties and conduct its business as
described in the Prospectus.
(g) Each significant subsidiary of the Company, as defined in Rule 1-02
of Regulation S-X of the Commission ("Significant Subsidiary"), has been duly
incorporated and is validly existing as a corporation in good standing under the
laws of the jurisdiction of its incorporation; all of the issued and outstanding
capital stock of each Significant Subsidiary has been duly and validly issued
and is fully paid and non-assessable; and all of the capital stock of each
Significant Subsidiary is owned by the Company free and clear of any pledge,
lien, encumbrance, claim or equity.
(h) Neither the Company nor any Significant Subsidiary is in violation
of its articles or certificate of incorporation, or in default in the
performance or observance of any material obligation, agreement, covenant or
condition contained in any mortgage or any material contract, lease, note or
other instrument to which it is a party or by which it may be bound, or
materially in violation of any law, administrative regulation or administrative,
arbitration or court order to which it is subject or bound, except in each case
to such extent as may be set forth in the Prospectus; and the execution and
delivery of this Agreement, the incurrence of the obligations herein set forth
and the consummation of the transactions herein contemplated will not conflict
with or constitute a breach of, or default under, the articles of incorporation
or by-laws of the Company or any mortgage, contract, lease, note or other
instrument to which the Company or any Significant Subsidiary is a party or by
which it or any Significant Subsidiary may be bound, or any law, administrative
regulation or administrative, arbitration or court order to which it is subject
or bound.
(i) The Company has filed with the Illinois Commerce Commission ("ICC")
a petition with respect to the issuance and sale of the Securities and the ICC
has issued its order authorizing and approving such issuance and sale. No
consent of or approval by any other public board or body or administrative
agency, federal or state, is necessary to authorize the issuance and sale of the
Purchased Notes, except as may be required under the blue sky laws of any
jurisdiction in connection with the purchase and distribution of the Purchased
Notes by the Underwriters in the manner contemplated herein and in the
Prospectus.
(j) There is no pending or threatened suit or proceeding before any
court or governmental agency, authority or body or any arbitration involving the
Company or any of its significant subsidiaries required to be disclosed in the
Prospectus which is not adequately disclosed in the Prospectus.
(k) This Agreement has been duly authorized, executed and delivered by
the Company.
(l) The Indenture has been duly authorized by the necessary corporate
action and duly qualified under the Trust Indenture Act; and the Indenture has
been duly authorized and, assuming due authorization, execution and delivery
thereof by the Trustee, constitutes a legal, valid, binding instrument
enforceable against the Company in accordance with its terms (subject, as to the
enforcement of remedies, to applicable bankruptcy, reorganization, insolvency,
3
fraudulent transfer, moratorium or other laws affecting creditors' rights
generally from time to time in effect and to general principles of equity).
(m) The issuance and sale of the Purchased Notes by the Company
in accordance with the terms of this Agreement have been duly authorized; the
Purchased Notes, when executed and authenticated in accordance with the
provisions of the Indenture and delivered to and paid for by the Underwriters,
will have been duly executed and delivered by the Company and will constitute
the legal, valid and binding obligations of the Company entitled to the benefits
of the Indenture (subject, as to the enforcement of remedies, to applicable
bankruptcy, reorganization, insolvency, fraudulent transfer, moratorium or other
laws affecting creditors' rights generally from time to time in effect and to
general principles of equity), and the holders of the Purchased Notes will be
entitled to the payment of principal and interest as therein provided; and the
statements in the Prospectus under the headings ["Description of Notes"] and
["The Indenture"] fairly summarize the matters therein described.
(n) The franchise granted to the Company by the City Council of
the City of Chicago under an ordinance effective January 1, 1992, is valid and
subsisting and duly authorizes the Company to engage in the electric utility
business conducted by it in such City. The several franchises of the Company
outside the City of Chicago are valid and subsisting and authorize the Company
to carry on its utility business in the several communities, capable of granting
franchises, located in the territory served by the Company outside the City of
Chicago (with immaterial exceptions).
(o) The Company has good and sufficient title to all property
described or referred to in the Company's Mortgage dated July 1, 1923, as
amended and supplemented (the "Mortgage") and purported to be conveyed thereby,
subject only to the lien of the Mortgage and permitted liens as therein defined
(except as to property released from the lien of the Mortgage in connection with
the sale or other disposition thereof, and certain other exceptions which are
not material in the aggregate).
Any certificate signed by any officer of the Company and
delivered to you or to counsel for the Underwriters in connection with the
offering of the Purchased Notes shall be deemed a representation and warranty by
the Company to each Underwriter as to the matters covered thereby.
3. Purchase, Offering and Delivery -- Closing Date. Subject to the
terms and conditions herein set forth, the Company agrees to sell to each
Underwriter, and each Underwriter agrees, severally and not jointly, to purchase
from the Company at the purchase price set forth in Schedule I hereto, the
principal amount of the Purchased Notes set forth opposite each Underwriter's
name in Schedule II hereto. It is understood that the Underwriters propose to
offer the Purchased Notes for sale to the public as set forth in the Prospectus
Supplement, as hereinafter defined, relating to the Purchased Notes. The time
and date of delivery and payment shall be the time and date specified in
Schedule I hereto; provided, however, that such time or date may be accelerated
or extended by agreement between the Company and the Representatives or as
provided in Section 9 hereof. The time and date of such delivery and payment are
herein sometimes referred to as the "Closing Date." Delivery of the Purchased
Notes shall be made to the Representatives for the respective accounts of the
several
4
Underwriters against payment by the several Underwriters through the
Representatives of the purchase price thereof to or upon the order of the
Company by wire transfer payable in same-day funds to the account specified by
the Company. Delivery of the Purchased Notes shall be made through the
facilities of The Depository Trust Company
4. Agreements. The Company agrees with the several Underwriters that:
(a) Promptly following the execution of this Agreement, the
Company will cause the Prospectus, including as part thereof a prospectus
supplement relating to the Purchased Notes (the "Prospectus Supplement"), to be
filed with the Commission pursuant to Rule 424 under the Act and the Company
will promptly advise the Representatives when such filing has been made. Prior
to such filing, the Company will cooperate with the Representatives in the
preparation of the Prospectus Supplement to assure that the Representatives have
no reasonable objection to the form or content thereof when filed.
(b) The Company will promptly advise the Representatives (i) when
any amendment to the Registration Statement shall have become effective, (ii) of
any request by the Commission for any amendment of the Registration Statement or
amendment or supplement to the Prospectus or for any additional information,
(iii) of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or the institution or threatening of
any proceeding for that purpose and (iv) of the receipt by the Company of any
notification with respect to the suspension of the qualification of the
Purchased Notes for sale in any jurisdiction or the initiation or threatening of
any proceeding for such purpose. The Company will not file any amendment to the
Registration Statement or amendment or supplement to the Prospectus unless the
Company has furnished the Representatives a copy for their review prior to
filing and will not file any such proposed amendment or supplement without the
consent of the Representatives, which consent shall not be unreasonably
withheld. The Company will use its best efforts to prevent the issuance of any
such stop order and, if issued, to obtain as soon as possible the withdrawal
thereof.
(c) If, at any time when a prospectus relating to the Purchased
Notes 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 shall be necessary to amend or supplement
the Registration Statement or the Prospectus to comply with the Act or the
Exchange Act or the rules and regulations of the Commission under such Acts, the
Company promptly will prepare and file with the Commission, subject to paragraph
(b) of this Section 4, an amendment or supplement which will correct such
statement or omission or an amendment or supplement which will effect such
compliance.
(d) The Company will furnish without charge to (i) each of the
Representatives and counsel for the Underwriters a signed copy of the
Registration Statement (but without exhibits incorporated by reference), as
originally filed, all amendments thereto filed prior to the Closing Date, all
Incorporated Documents (including exhibits, other than exhibits incorporated by
reference) and the Statement on Form T-1 of the Trustee under the Indenture,
(ii) each other Underwriter a conformed copy of the Registration Statement (but
without exhibits), as
5
originally filed, all amendments thereto (but without exhibits) and all
Incorporated Documents (but without exhibits other than the Company's latest
Annual Report to shareholders) and (iii) each Underwriter as many copies of the
Prospectus, the Prospectus Supplement thereto and, so long as delivery of a
prospectus or supplement thereto by an Underwriter or dealer may be required
under the Act, any amendments thereof and supplements thereto (but without
Incorporated Documents or exhibits), as soon as available and in such quantities
as the Representatives may reasonably request.
(e) The Company will arrange, if necessary, for the qualification
of the Purchased Notes for sale under the laws of such jurisdictions within the
United States as the Representatives may designate and will maintain such
qualification in effect so long as required for the sale of the Purchased Notes,
provided, that in no event shall the Company be obligated to qualify to do
business in any jurisdiction where it is not now so qualified or take any action
that would subject it to service of process in suits (other than those arising
out of the offering or sale of the Purchased Notes) in any jurisdiction where it
is not now so subject. The Company will promptly advise the Representatives of
the receipt by the Company of any notification with respect to the qualification
of the Purchased Notes for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose.
(f) The Company agrees to pay the costs and expenses relating to
the following matters: (i) the preparation of the Prospectus, the issuance of
the Purchased Notes and the fees of the Trustee; (ii) the preparation, printing
or reproduction of the Prospectus and each amendment or supplement thereto;
(iii) the printing (or reproduction) and delivery (including postage, air
freight charges and charges for counting and packaging) of such copies of the
Prospectus, and all amendments or supplements to it, as may, be reasonably
requested for use in connection with the offering and sale of the Purchased
Notes; (iv) the preparation, printing, authentication, issuance and delivery of
certificates for the Purchased Notes, including any stamp or transfer taxes in
connection with the original issuance and sale of the Purchased Notes; (v) the
printing (or reproduction) and delivery of this Agreement, any blue sky
memorandum and all other agreements or documents printed (or reproduced) and
delivered in connection with the offering of the Purchased Notes; (vi) any
registration or qualification of the Purchased Notes for offer and sale under
the securities or blue sky laws of the several states (including filing fees and
the reasonable fees and expenses of counsel for the Underwriters relating to
such registration and qualification); (vii) the transportation and other
expenses incurred by or on behalf of Company representatives in connection with
presentations to prospective purchasers of the Purchased Notes; (viii) the fees
and expenses of the Company's accountants and counsel (including local and
special counsel); (ix) the fees and expenses of any rating agencies rating the
Purchased Notes and (x) all other costs and expenses incident to the performance
by the Company of its obligations hereunder.
(g) The Company will, if requested by the Representatives, use
its best efforts to cause the Purchased Notes to be listed on the New York Stock
Exchange.
(h) During the period beginning from the date of this Agreement
and continuing to and including the later of (i) the termination of trading
restrictions on the Purchased Notes, as notified to the Company by the
Representatives, and (ii) the Closing Date, the Company will not offer, sell,
contract to sell or otherwise dispose of any debt securities of the
6
Company which mature more than one year after the Closing Date and which are
substantially similar to the Purchased Notes, without the prior written consent
of the Representatives; provided, however, that in no event shall the foregoing
period extend more than fifteen calendar days from the date of this Agreement.
5. Conditions to the Obligations of the Underwriters. The
obligations of the Underwriters to purchase and pay for the Purchased Notes
shall be subject to the accuracy of the representations and warranties on the
part of the Company contained herein as of the date hereof and the Closing Date,
to the accuracy of the statements of the Company made in any certificates
pursuant to the provisions hereof, to the performance by the Company of its
obligations hereunder and to the following additional conditions:
(a) No stop order suspending the effectiveness of the
Registration Statement shall be in effect and no proceedings for that purpose
shall then be pending before, or threatened by, the Commission.
(b) The Company shall have furnished to the Representatives the
opinion of Sidley Xxxxxx Xxxxx & Xxxx, counsel for the Company, dated the
Closing Date and addressed to the Representatives, in form and substance
satisfactory to each of the Representatives and their counsel.
(c) The Representatives shall have received from Winston &
Xxxxxx, counsel for the Underwriters, such opinion or opinions, dated the
Closing Date, with respect to the issuance and sale of the Purchased Notes, the
Indenture, the Registration Statement, the Prospectus and other related matters
as the Representatives may reasonably require, and the Company shall have
furnished to such counsel such documents as they request for the purpose of
enabling them to pass upon such matters.
(d) The Company shall have furnished to the Representatives a
certificate of the Company, signed by the Treasurer or Assistant Treasurer of
the Company, dated the Closing Date, to the effect that the signer of such
certificate has carefully examined the Prospectus, any amendment or supplement
to the Prospectus and this Agreement and that:
(i) the representations and warranties of the Company
in this Agreement are true and correct in all material respects on and
as of the Closing Date with the same effect as if made on the Closing
Date, and the Company has complied with all the agreements and
satisfied all the conditions on its part to be performed or satisfied
hereunder at or prior to the Closing Date;
(ii) since the date of the most recent financial
statements included in the Prospectus (exclusive of any amendment or
supplement thereto), there has been no material adverse change in the
financial condition, business or properties of the Company and its
subsidiaries, taken as a whole, whether or not arising from
transactions in the ordinary course of business, except as set forth in
or contemplated by the Prospectus (exclusive of any amendment or
supplement thereto); and
7
(iii) no stop order suspending the effectiveness of
the Registration Statement has been issued and no proceedings for that
purpose have been initiated or, to his or her knowledge, threatened by
the Commission.
(e) On the date hereof and on the Closing Date, the Company shall
have requested and caused PricewaterhouseCoopers LLP to furnish to the
Representatives letters, dated respectively the date hereof and the Closing
Date, in form and substance satisfactory to the Representatives.
(f) Subsequent to the date of this Agreement, or, if earlier, the
respective dates as of which information is given in the Registration Statement
and the Prospectus, there shall not have been (i) any change or decrease
specified in the letter referred to in paragraph (e) of this Section 5 or (ii)
any change, or any development involving a prospective change, in or affecting
the financial condition, business or properties of the Company and its
subsidiaries, taken as a whole, whether or not arising from transactions in the
ordinary course of business, except as set forth in or contemplated in the
Prospectus (exclusive of any amendment or supplement thereto) the effect of
which, in any case referred to in clause (i) or (ii) above, is, in the sole
judgment of the Representatives, so material and adverse as to make it
impractical or inadvisable to proceed with the public offering or delivery of
the Purchased Notes as contemplated by the Prospectus (exclusive of any
amendment or supplement thereto).
(g) On the Closing Date, (i) the Purchased Notes shall be rated
______ by Xxxxx'x Investors Service, Inc. and ______ by Standard & Poor's Rating
Services, and the Company shall have delivered to the Representatives evidence
satisfactory to the Representatives confirming that the Purchased Notes have
such ratings, and (ii) subsequent to the date of this Agreement, there shall not
have occurred a downgrading in the rating assigned to the Purchased Notes or any
of the Company's first mortgage bonds or commercial paper by any "nationally
recognized statistical rating agency", as that term is defined by the Commission
for purposes of Rule 436(g)(2) under the Act, and no such securities rating
agency shall have publicly announced that it has under surveillance or review,
with possible negative implications, its rating of the Purchased Notes or any of
the Company's other debt securities.
(h) Prior to the Closing Date, the Company shall have furnished
to the Representatives such further information, certificates and documents as
the Representatives may reasonably request.
If any of the conditions specified in this Section 5 shall not
have been fulfilled in all material respects when and as provided in this
Agreement, or if any of the opinions or certificates mentioned above or
elsewhere in this Agreement shall not be in all material respects reasonably
satisfactory in form and substance to the Representatives and their counsel,
this Agreement and all obligations of the Underwriters hereunder may be canceled
at, or at any time prior to, the Closing Date by the Representatives. Notice of
such cancellation shall be given to the Company in writing or by telephone or
facsimile confirmed in writing.
The documents required to be delivered by this Section 5 will be
delivered at the office of counsel for the Company, at Sidley Xxxxxx Xxxxx &
Xxxx, 00 Xxxxx Xxxxxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxxx 00000, on the
Closing Date.
8
6. Conditions of Company's Obligation. The obligation of the Company to
deliver the Purchased Notes upon payment therefor shall be subject to the
following conditions:
On the Closing Date, the order of the ICC referred to in subparagraph
(i) of Section 2 hereof shall be in full force and effect substantially in the
form in which originally entered; the Indenture shall be qualified under the
Trust Indenture Act as and to the extent required by such Act; and no stop order
suspending the effectiveness of the Registration Statement shall be in effect
and no proceedings for that purpose shall then be pending before, or threatened
by, the Commission.
In case any of the conditions specified above in this Section 6 shall
not have been fulfilled, this Agreement may be terminated by the Company by
delivering written notice of termination to the Representatives. Any such
termination shall be without liability of any party to any other party except to
the extent provided in Sections 7 and 8 hereof.
7. Reimbursement of Underwriters' Expenses. If the sale of the
Purchased Notes provided for herein is not consummated because any condition to
the obligations of the Underwriters or the Company set forth in Section 5 and
Section 6 hereof, respectively, is not satisfied because of any termination
pursuant to Section 10 hereof, or because of any refusal, inability or failure
on the part of the Company to perform any agreement herein or comply with any
provisions hereof other than by reason of a default by any of the Underwriters,
the Company will reimburse the Underwriters severally upon demand for all
out-of-pocket expenses (including reasonable fees and disbursements of counsel)
that shall have been incurred by them in connection with the proposed purchase
and sale of the Purchased Notes.
8. Indemnification and Contribution. (a) The Company agrees to
indemnify and hold harmless each Underwriter, the directors, officers, employees
and agents of each Underwriter and each person who controls any Underwriter
within the meaning of either the Act or the Exchange Act against any and all
losses, claims, damages or liabilities, joint or several, to which they or any
of them may become subject under the Act, the Exchange Act or other federal or
state statutory law or regulation, at common law or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement as originally filed or in
any amendment thereof, or in any preliminary prospectus or the Prospectus, or in
any amendment thereof or supplement thereto, or arise out of or are based upon
the omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, and agrees to
reimburse each such indemnified party, as incurred, for any legal or other
expenses reasonably incurred by them in connection with investigating or
defending any such loss, claim, damage, liability or action; provided, however,
that the Company will not be liable in any such case to the extent that any such
loss, claim, damage or liability arises out of or is based upon any such untrue
statement or alleged untrue statement or omission or alleged omission made
therein in reliance upon and in conformity with written information furnished to
the Company by or on behalf of any Underwriter through the Representatives
specifically for inclusion therein; provided, further, that the foregoing
indemnity with respect to any untrue statement contained in or omission from any
preliminary prospectus shall not inure to the benefit of any Underwriter (or any
of the directors, officers, employees and agents of such
9
Underwriter or any person controlling such Underwriter) from whom the person
asserting any such loss, claim, damage or liability purchased any of the
Purchased Notes which are the subject thereof if such person did not receive a
copy of the Prospectus (or the Prospectus as then amended or supplemented if the
Company shall have furnished any amendments or supplements thereto), excluding
the Incorporated Documents, at or prior to the confirmation of the sale of such
Purchased Notes to such person in any case where such delivery is required by
the Act and the untrue statement or omission of a material fact contained in
such preliminary prospectus was corrected in the Prospectus (or the Prospectus
as so amended or supplemented if the Company shall have furnished any amendments
or supplements thereto), and it is finally judicially determined that such
delivery was required to be made under the Act and was not so made. This
indemnity agreement will be in addition to any liability which the Company may
otherwise have.
(b) Each Underwriter severally and not jointly agrees to indemnify and
hold harmless the Company and each of its directors, officers, employees and
agents, and each person who controls the Company within the meaning of either
the Act or the Exchange Act, to the same extent as the foregoing indemnity from
the Company to each Underwriter, but only with reference to written information
relating to such Underwriter furnished to the Company by or on behalf of such
Underwriter through the Representatives specifically for inclusion in the
documents referred to in the foregoing indemnity. This indemnity agreement will
be in addition to any liability which any Underwriter may otherwise have. The
Company acknowledges that the statements set forth in _______________________
constitute the only information furnished in writing by or on behalf of the
Underwriters for inclusion in the Registration Statement, any preliminary
prospectus or the Prospectus (or in any amendment or supplement thereto).
(c) Promptly after receipt by an indemnified party under this Section 8
of notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under this
Section 8, notify the indemnifying party in writing of the commencement thereof;
but the failure so to notify the indemnifying party (i) will not relieve it from
liability under paragraph (a) or (b) above unless and to the extent it did not
otherwise learn of such action and such failure results in the forfeiture by the
indemnifying party of substantial rights and defenses; and (ii) will not, in any
event, relieve the indemnifying party from any obligations to any indemnified
party other than the indemnification obligation provided in paragraph (a) or (b)
above. The indemnifying party shall be entitled to appoint counsel of the
indemnifying party's choice at the indemnifying party's expense to represent the
indemnified party in any action for which indemnification is sought (in which
case the indemnifying party shall not thereafter be responsible for the fees and
expenses of any separate counsel retained by the indemnified party or parties
except as set forth below); provided, however, that such counsel shall be
satisfactory to the indemnified party. Notwithstanding the indemnifying party's
election to appoint counsel to represent the indemnified party in an action, the
indemnified party shall have the right to employ separate counsel (including
local counsel), and the indemnifying party shall bear the reasonable fees, costs
and expenses of such separate counsel if (i) the use of counsel chosen by the
indemnifying party to represent the indemnified party would present such counsel
with a conflict of interest; (ii) the actual or potential defendants in, or
targets of, any such action include both the indemnified party and the
indemnifying party and the indemnified party shall have reasonably concluded
that there may be legal defenses available to it and/or other indemnified
parties which
10
are different from or additional to those available to the indemnifying party;
(iii) the indemnifying party shall not have employed counsel satisfactory to the
indemnified party to represent the indemnified party within a reasonable time
after notice of the institution of such action; or (iv) the indemnifying party
shall authorize the indemnified party to employ separate counsel at the expense
of the indemnifying party. An indemnifying party will not, without the prior
written consent of the indemnified parties, settle or compromise or consent to
the entry of any judgment with respect to any pending or threatened claim,
action, suit or proceeding in respect of which indemnification or contribution
may be sought hereunder (whether or not the indemnified parties are actual or
potential parties to such claim or action) unless such settlement, compromise or
consent includes an unconditional release of each indemnified party from all
liability arising out of such claim, action, suit or proceeding.
(d) In the event that the indemnity provided in paragraph (a) or (b) of
this Section 8 is for any reason held to be unenforceable by an indemnified
party although applicable in accordance with its terms, the Company and the
Underwriters agree to contribute to the aggregate losses, claims, damages and
liabilities (including legal or other expenses reasonably incurred in connection
with investigating or defending same) (collectively "Losses") to which the
Company and one or more of the Underwriters may be subject in such proportion as
is appropriate to reflect the relative benefits received by the Company on the
one hand and by the Underwriters on the other from the offering of the Purchased
Notes; provided, however, that in no case shall any Underwriters (except as may
be provided in any agreement among the Underwriters relating to the offering of
the Purchased Notes) be responsible for any amount in excess of the purchase
discount or commission applicable to the Purchased Notes purchased by such
Underwriters hereunder; provided, further, that each Underwriter's obligation to
contribute to Losses hereunder shall be several and not joint. If the allocation
provided by the immediately preceding sentence is unavailable for any reason,
the Company and the Underwriters shall contribute in such proportion as is
appropriate to reflect not only such relative benefits but also the relative
fault of the Company on the one hand and of the Underwriters on the other in
connection with the statements or omissions which resulted in such Losses, as
well as any other relevant equitable considerations. Benefits received by the
Company shall be deemed to be equal to the total net proceeds from the offering
(before deducting expenses) received by it, and benefits received by the
Underwriters shall be deemed to be equal to the total purchase discounts and
commissions in each case set forth on the cover of the Prospectus. Relative
fault shall be determined by reference to, among other things, whether any
untrue or any alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information provided by the
Company on the one hand or the Underwriters on the other, the intent of the
parties and their relative knowledge, information and opportunity to correct or
prevent such untrue statement or omission. The Company and the Underwriters
agree that it would not be just and equitable if contribution were determined by
pro rata allocation or any other method of allocation which does not take
account of the equitable considerations referred to above. Notwithstanding the
provisions of this paragraph (d), 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. For purposes of this Section 8, each person who controls an
Underwriter within the meaning of either the Act or the Exchange Act and each
director, officer, employee and agent of an Underwriters shall have the same
rights to contribution as such Underwriter, and each person who controls the
Company within the meaning of either the Act or the Exchange Act and each
officer, director,
11
employee or agent of the Company shall have the same rights to contribution as
the Company, subject in each case to the applicable terms and conditions of this
paragraph (d).
9. Default by an Underwriter. If any one or more Underwriters shall
fail to purchase and pay for any of the Purchased Notes agreed to be purchased
by such Underwriter or Underwriters hereunder and such failure to purchase shall
constitute a default in the performance of its or their obligations under this
Agreement, the remaining Underwriters shall be obligated severally to take up
and pay for (in the respective proportions which the amount of Purchased Notes
set forth opposite their names in Schedule II hereto bears to the aggregate
amount of Purchased Notes set forth opposite the names of all the remaining
Underwriters) the Purchased Notes which the defaulting Underwriter or
Underwriters agreed but failed to purchase, provided, however, that in the event
that the aggregate principal amount of Purchased Notes which the defaulting
Underwriter or Underwriters agreed but failed to purchase shall exceed 10% of
the aggregate principal amount of the Purchased Notes set forth in Schedule II
hereto, the remaining Underwriters shall have the right to purchase all, but
shall not be under any obligation to purchase any, of the Purchased Notes, and
if such nondefaulting Underwriters do not purchase all the Purchased Notes, this
Agreement will terminate without liability to any nondefaulting Underwriter or
the Company. In the event of a default by any Underwriter as set forth in this
Section 9, the Closing Date shall be postponed for such period, not exceeding
five business days, as the Representatives shall determine in order that the
required changes in the Registration Statement and the Prospectus Supplement or
in any other documents or arrangements may be effected. Nothing contained in
this Agreement shall relieve any defaulting Underwriter of its liability, if
any, to the Company or any nondefaulting Underwriter for damages occasioned by
its default hereunder.
10. Termination. This Agreement shall be subject to termination in the
absolute discretion of the Representatives, by notice given to the Company prior
to delivery of and payment for the Purchased Notes, if at any time after the
date hereof and prior to the delivery of and payment for the Purchased Notes (i)
trading in Exelon Corporation's common stock shall have been suspended by the
Commission or the New York Stock Exchange or trading in securities generally on
the New York Stock Exchange shall have been suspended or limited or minimum
prices shall have been established on such Exchange; (ii) a banking moratorium
shall have been declared either by federal or New York State authorities; or
(iii) there shall have occurred any outbreak or escalation of hostilities,
declaration by the United States of a national emergency or war or other
calamity or crisis the effect of which on financial markets is such as to make
it, in the sole judgment of the Representatives, impracticable or inadvisable to
proceed with the offering or delivery of the Purchased Notes as contemplated by
the Prospectus.
11. Representations and Indemnities to Survive. The respective
agreements, representations, warranties, indemnities and other statements of the
Company or its officers and of the Underwriters set forth in or made pursuant to
this Agreement will remain in full force and effect, regardless of any
investigation made by or on behalf of the Underwriters or the Company or any of
the officers, directors or controlling persons referred to in Section 8 hereof,
and will survive delivery of and payment for the Purchased Notes. The provisions
of Sections 7 and 8 hereof shall survive the termination or cancellation of this
Agreement.
12
12. Notices. All communications hereunder will be in writing and
effective only on receipt, and, if sent to the Representatives, will be mailed,
delivered or telefaxed to them at the address specified in Schedule I hereto,
or, if sent to the Company, will be mailed, delivered or telefaxed to Exelon
Corporation, 00 Xxxxx Xxxxxxxx Xxxxxx, 00xx Floor, X.X. Xxx 000000, Xxxxxxx,
Xxxxxxxx 00000-0000, Attention: Vice President and Treasurer (fax no.: (312)
000-0000) and confirmed to the General Counsel of Exelon Corporation (fax no.:
(000) 000-0000).
13. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and assigns and
the officers and directors and controlling persons referred to in Section 8
hereof, and no other person will have any right or obligation hereunder. The
term "successors and assigns" as used in this Agreement shall not include any
purchaser, as such purchaser, of any of the Purchased Notes from any of the
Underwriters.
14. Representation of the Underwriters. The Representatives represent
and warrant to the Company that they are authorized to act as the
representatives of the Underwriters in connection with this financing, and the
Representatives' execution and delivery of this Agreement and any action under
this Agreement taken by such Representatives will be binding upon all
Underwriters.
15. Interpretation When No Representatives. In the event no
Underwriters are named in Schedule II hereto, the term "Underwriters" shall be
deemed for all purposes of this Agreement to be the Representative or
Representatives named as such in Schedule I hereto, the principal amount of the
Purchased Notes to be purchased by any such Underwriter shall be that set
opposite its name in Schedule I hereto and all references to the "Underwriters"
shall be deemed to be the Representative or Representatives named in Schedule I
hereto.
16. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument.
17. Applicable Law. This Agreement will be governed by and construed in
accordance with the laws of the State of New York applicable to contracts made
and to be performed within the State of New York.
13
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof, whereupon
this Agreement and your acceptance shall represent a binding agreement between
the Company and each of the several Underwriters.
Very truly yours,
COMMONWEALTH EDISON COMPANY
By:
--------------------------------------
Name:
Title:
The foregoing Agreement is hereby confirmed and accepted as of the date first
above written.
[ ]
--------------------------------
By:
------------------------------
Name:
Title:
For themselves and the other
several Underwriters named in
Schedule II hereto.
14
SCHEDULE I
REPRESENTATIVES:
PURCHASE PRICE AND DESCRIPTION OF PURCHASED NOTES:
PRINCIPAL AMOUNT:
PURCHASE PRICE:
INTEREST RATE:
INITIAL PUBLIC OFFERING
PRICE:
DEALER DISCOUNT:
REALLOWANCE TO DEALERS:
MATURITY:
SINKING FUND PROVISIONS:
REDEMPTION PROVISIONS:
15
OTHER PROVISIONS:
TIME AND DATE OF DELIVERY AND PAYMENT:
TIME AND DATE --
PLACE OF DELIVERY AND PAYMENT:
DELIVERY --
PAYMENT --
FUNDS --
OFFICE FOR EXAMINATION OF PURCHASED NOTES:
--------------------------------
--------------------------------
--------------------------------
SPECIFIED DATE PURSUANT TO SECTION 3 OF UNDERWRITING AGREEMENT:
--------------------------------
ADDRESS FOR NOTICES TO REPRESENTATIVES PURSUANT TO SECTION 12 OF UNDERWRITING
AGREEMENT:
--------------------------------
--------------------------------
--------------------------------
16
SCHEDULE II
PRINCIPAL AMOUNT
NAME OF UNDERWRITER OF PURCHASED NOTES
------------------- ------------------
17
