Wisconsin Public Service Corporation
6.08% Senior Notes Due December 1, 2028
Form of Underwriting Agreement
New York, New York
December 14, 1998
To the Representatives
named in Schedule I
hereto of the Under-
writers named in
Schedule II hereto
Ladies and Gentlemen:
Wisconsin Public Service Corporation, a corporation organized under
the laws of Wisconsin (the "Company"), proposes to sell to the several
underwriters named in Schedule II hereto (the "Underwriters"), for whom you
(the "Representatives") are acting as representatives, the principal amount
of its senior debt securities identified in Schedule I hereto (the "Senior
Notes"), to be issued under an Indenture dated as of December 1, 1998,
between the Company and Firstar Bank Milwaukee, N.A., as trustee (the "Senior
Trustee"), as supplemented by the First Supplemental Indenture dated as of
December 1, 1998, creating the series in which the Senior Notes are to be
issued, a form of which is included as an exhibit to the Registration
Statement (the "Supplemental Indenture to the Senior Indenture"). The term
"Senior Indenture," as used herein, means such Indenture dated as of
December 1, 1998 , as supplemented by the Supplemental Indenture to the
Senior Indenture. To the extent there are no additional Underwriters listed
on Schedule I other than you, the term Representatives as used herein shall
mean you, as Underwriters, and the terms Representatives and Underwriters
shall mean either the singular or plural as the context requires.
Until the Release Date (as defined in the Senior Indenture), the
Senior Notes will be secured as to payment of principal and interest by the
Company's First Mortgage Bonds, Collateral Series A (the "Collateral Bonds"),
issued under and ratably secured by the First Mortgage and Deed of Trust
dated January 1, 1941 between the Company and Firstar Bank Milwaukee, N.A.
(the successor to First Wisconsin Trust Company), as Trustee (the "Mortgage
Trustee"), as amended and supplemented to the Execution Time (as so amended
and supplemented, the "Original Mortgage Indenture") and to be further
supplemented by the Thirty-Third Supplemental Indenture thereto, a form of
which is included in the Registration Statement, creating the Collateral
Bonds (the
"Supplemental Indenture to the Mortgage Indenture"). The term "Mortgage
Indenture," as used herein, means the Original Mortgage Indenture, as
supplemented by the Supplemental Indenture to the Mortgage Indenture. The
Collateral Bonds will be issued, pledged and delivered to the Senior Trustee
by the Company concurrently with the issue and delivery of the Senior Notes.
Any reference herein to the Registration Statement, the Basic
Prospectus, any Preliminary Final Prospectus or the Final Prospectus shall be
deemed to refer to and include the documents incorporated by reference
therein pursuant to Item 12 of Form S-3 which were filed under the Exchange
Act on or before the Effective Date of the Registration Statement or the
issue date of the Basic Prospectus, any Preliminary Final Prospectus or the
Final Prospectus, as the case may be; and any reference herein to the terms
"amend", "amendment" or "supplement" with respect to the Registration
Statement, the Basic Prospectus, any Preliminary Final Prospectus or the
Final Prospectus shall be deemed to refer to and include the filing of any
document under the Exchange Act after the Effective Date of the Registration
Statement or the issue date of the Basic Prospectus, any Preliminary Final
Prospectus or the Final Prospectus, as the case may be, deemed to be
incorporated therein by reference. Certain terms used herein are defined in
Section 17 hereof. Capitalized terms used herein and not otherwise defined
have the meaning given such terms in the Senior Indenture.
1. REPRESENTATIONS AND WARRANTIES. The Company represents and
warrants to, and agrees with, each Underwriter as set forth below in this
Section 1.
(a) The Company meets the requirements for use of Form S-3 under
the Act and has prepared and filed with the Commission a registration
statement (the file number of which is set forth in Schedule I hereto)
on Form S-3, including a related basic prospectus, for registration
under the Act of the offering and sale of the Senior Notes. The Company
may have filed one or more amendments thereto, including a Preliminary
Final Prospectus, each of which has previously been furnished to you.
The Company will next file with the Commission one of the following: (1)
after the Effective Date of such registration statement, a final
prospectus supplement relating to the Senior Notes in accordance with
Rules 430A and 424(b), (2) prior to the Effective Date of such
registration statement, an amendment to such registration statement
(including the form of final prospectus supplement), or (3) a final
prospectus in accordance with Rules 415 and 424(b). In the case of
clause (1), the Company has included in such registration statement, as
amended at the Effective Date, all information (other than Rule 430A
Information) required by the Act and the rules thereunder to be included
in such registration statement and the Final Prospectus. As filed, such
final prospectus supplement or such amendment and form of final
prospectus supplement shall contain all Rule 430A Information, together
with all other such required information, and, except to the extent the
Representatives shall agree in writing to a modification, shall be in
all substantive respects in the form furnished to you prior to the
Execution Time or, to the extent not completed at the Execution Time,
shall contain only such specific additional information and other
changes (beyond that contained in the Basic Prospectus and any
Preliminary Final Prospectus) as the Company has advised you, prior to
the Execution Time,
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will be included or made therein. The Registration Statement, at the
Execution Time, meets the requirements set forth in Rule 415(a)(1)(x).
(b) On the Effective Date, the Registration Statement did or will,
and when the Final Prospectus is first filed (if required) in accordance
with Rule 424(b) and on the Closing Date (as defined herein), the Final
Prospectus (and any supplement thereto) will, comply in all material
respects with the applicable requirements of the Act, the Exchange Act
and the Trust Indenture Act and the respective rules thereunder; on the
Effective Date and at the Execution Time, the Registration Statement did
not or will not contain any untrue statement of a material fact or omit
to state any material fact required to be stated therein or necessary in
order to make the statements therein not misleading; on the Effective
Date and on the Closing Date the Indenture did or will comply in all
material respects with the applicable requirements of the Trust
Indenture Act and the rules thereunder; and, on the Effective Date, the
Final Prospectus, if not filed pursuant to Rule 424(b), will not, and on
the date of any filing pursuant to Rule 424(b) and on the Closing Date,
the Final Prospectus (together with any supplement thereto) will not,
include any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
PROVIDED, HOWEVER, that the Company makes no representations or
warranties as to (i) that part of the Registration Statement which shall
constitute the Statement of Eligibility and Qualification (Form T-1)
under the Trust Indenture Act of the Trustee or (ii) the information
contained in or omitted from the Registration Statement or the Final
Prospectus (or any supplement thereto) in reliance upon and in
conformity with information furnished in writing to the Company by or on
behalf of any Underwriter through the Representatives specifically for
inclusion in the Registration Statement or the Final Prospectus (or any
supplement thereto).
(c) The Company has been duly incorporated and is validly existing
as a corporation under the laws of the State of Wisconsin with power and
authority (corporate and other) to own or lease, as the case may be, and
to operate its properties and conduct its business as described in the
Final Prospectus; the Company has not filed Articles of Dissolution with
the Secretary of State of Wisconsin, and no grounds exist for the
Secretary of State of Wisconsin to dissolve such corporation
administratively pursuant to the provisions of the Wisconsin Business
Corporation Law; the Company is duly qualified to do business as a
foreign corporation and is in good standing under the laws of each
jurisdiction which requires such qualification; the Company is a "public
utility company," as such term is defined in the Public Utility Holding
Company Act of 1935, as amended (the "Public Utility Holding Company
Act").
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(d) The Company has no subsidiaries which, either individually or
considered in the aggregate as a single subsidiary, constitute a
"significant subsidiary" as defined in Rule 1-02 of Regulation S-X.
(e) All of the Company's issued and outstanding shares of common
stock are owned, beneficially and of record, by WPS Resources
Corporation, a Wisconsin corporation ("WPSR"); the Company's authorized
preferred stock is as set forth in the Final Prospectus; except as set
forth in the Final Prospectus, no options, warrants or other rights to
purchase, agreements or other obligations to issue, or rights to convert
any obligations into or exchange any securities for, shares of capital
stock or ownership interests of the Company are outstanding.
(f) There is no franchise, contract or other document of a
character required to be described in the Registration Statement or
Final Prospectus, or to be filed as an exhibit thereto, which is not
described or filed as required.
(g) This Agreement has been duly authorized, executed and
delivered by the Company and constitutes a valid and binding obligation
of the Company enforceable in accordance with its terms.
(h) The Senior Indenture has been duly authorized by the Company;
on the Closing Date, the Senior Indenture will have been duly executed
by the Company and, assuming due authorization, execution and delivery
by the Senior Trustee, will be a valid and binding instrument
enforceable against the Company in accordance with its terms, subject,
as to enforcement of remedies, to applicable bankruptcy, reorganization,
insolvency, moratorium, or other laws affecting creditors' rights
generally from time to time in effect and to general principles of
equity, including, without limitation, concepts of materiality,
reasonableness, good faith and fair dealing, regardless of whether
considered in a proceeding in equity or at law (the "Bankruptcy
Exceptions"); the Senior Indenture has been duly qualified under the
Trust Indenture Act; the Senior Indenture conforms in all material
respects to the description thereof contained in the Final Prospectus.
(i) The Senior Notes have been duly authorized by the Company; on
the Closing Date, the Senior Notes will have been duly executed by the
Company, and when authenticated in accordance with the provisions of the
Senior Indenture and delivered and paid for by the Underwriters pursuant
to this Agreement, will constitute valid and legally binding obligations
of the Company entitled to the benefits and security provided by the
Senior Indenture and enforceable against the Company in accordance with
their terms, subject, as to enforcement of remedies, to the Bankruptcy
Exceptions; the Senior Notes conform in all material respects to the
description thereof contained in the Final Prospectus.
(j) The Original Mortgage Indenture has been duly authorized,
executed and delivered by the Company; the Supplemental Indenture to the
Mortgage Indenture has been duly authorized by the Company and, on the
Closing Date, will have been duly executed and
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delivered by the Company and, assuming due execution and delivery of the
Supplemental Indenture to the Mortgage Indenture by the Mortgage
Trustee, the Mortgage Indenture will constitute a valid and binding
instrument, enforceable against the Company in accordance with its
terms, except as the same may be limited by the laws of the States of
Wisconsin and Michigan affecting the remedies for the enforcement of the
security provided for therein (which laws do not make such remedies
inadequate for the realization of the benefits of such security) and by
the Bankruptcy Exceptions; the Mortgage Indenture conforms in all
material respects to the description thereof contained in the Final
Prospectus.
(k) The Collateral Bonds have been duly authorized by the Company
and, when duly executed and authenticated in accordance with the
provisions of the Mortgage Indenture and delivered to the Senior Trustee
in the manner provided therein, will have been duly authorized,
executed, authenticated and issued and will constitute valid and legally
binding obligations of the Company, secured by the lien of, and entitled
to the benefits provided by, the Mortgage Indenture, equally and ratably
with all other bonds of the Company duly issued and outstanding under
the Mortgage Indenture, and will be enforceable against the Company in
accordance with their terms, except as the same may be limited by the
laws of the States of Wisconsin and Michigan affecting the remedies for
the enforcement of the security provided for therein (which laws do not
make such remedies inadequate for the realization of the benefits of
such security) and by the Bankruptcy Exceptions; the Collateral Bonds
conform in all material respects to the description thereof contained in
the Final Prospectus.
(l) Each of the Company and its subsidiaries owns or leases all
such properties as are necessary to the conduct of its operations as
presently conducted. The properties of the Company described under Item
2 of the Company's most recent Annual Report on Form 10-K are owned in
fee simple either individually or jointly, as indicated in such annual
report, or are held under valid leases, in each case subject only to the
lien of the Mortgage Indenture and minor imperfections of titles and
encumbrances, if any, which are not substantial in amount, do not
materially detract from the value or marketability of the properties
subject thereto, and do not materially impair the Company's operations.
(m) The Company is not and, after giving effect to the offering
and sale of the Senior Notes and the application of the proceeds thereof
as described in the Final Prospectus, will not be an "investment
company" as defined in the Investment Company Act of 1940, as amended.
(n) Except for WPSR, no person or corporation which is a "holding
company" or a "subsidiary of a holding company" within the meaning of
such terms as defined in the Public Holding Company Act, directly or
indirectly owns, controls or holds with power to vote 10% or more of the
outstanding voting securities of the Company; WPSR and the Company are
presently exempt from the provisions of the Public Utility Holding
Company Act which would require them to register thereunder.
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(o) The Public Service Commission of Wisconsin has duly authorized
the issuance and sale by the Company of the Senior Notes and the
issuance and pledge of the Collateral Bonds on the terms set forth in
the Final Prospectus and this Agreement, and such authorization is in
force and effect and sufficient for the issuance and sale of the Senior
Notes to the Underwriters and the issuance and pledge of the Collateral
Bonds to the Senior Trustee. No other consent, approval, authorization,
filing with or order of any court or other governmental agency or body
is required in connection with the transactions contemplated herein,
except such as have been obtained under the Act and the Trust Indenture
Act and such as may be required under the blue sky laws of any
jurisdiction in connection with the purchase and distribution of the
Senior Notes by the Underwriters in the manner contemplated herein and
in the Final Prospectus.
(p) The execution and delivery of the Senior Indenture or the
Supplemental Indenture to the Mortgage Indenture, the issue and sale of
the Senior Notes, the issue and pledge of the Collateral Bonds, the
consummation of any other of the transactions herein contemplated or the
fulfillment of the terms hereof will not conflict with, result in a
breach or violation or imposition of any lien, charge or encumbrance
upon any property or assets of the Company or any of its subsidiaries
pursuant to, (i) the charter or by-laws of the Company or any of its
subsidiaries, (ii) the terms of any indenture, contract, lease,
mortgage, deed of trust, note agreement, loan agreement or other
agreement, obligation, condition, covenant or instrument to which the
Company or any of its subsidiaries is a party or bound or to which its
or their property is subject (other than the lien of the Mortgage
Indenture), or (iii) any statute, law, rule, regulation, judgment, order
or decree applicable to the Company or any of its subsidiaries of any
court, regulatory body, administrative agency, governmental body,
arbitrator or other authority having jurisdiction over the Company or
any of its subsidiaries or any of its or their properties.
(q) No holders of securities of the Company have rights to the
registration of such securities under the Registration Statement.
(r) The consolidated historical financial statements and schedules
of the Company and its consolidated subsidiary included in the Final
Prospectus and the Registration Statement present fairly in all material
respects the financial condition, results of operations and cash flows
of the Company and its subsidiary as of the dates and for the periods
indicated, comply as to form with the applicable accounting requirements
of the Act and have been prepared in conformity with generally accepted
accounting principles applied on a consistent basis throughout the
periods involved (except as otherwise noted therein). The selected
financial data set forth under the caption "Summary Financial
Information" in the Final Prospectus and Registration Statement fairly
present, on the basis stated in the Final Prospectus and the
Registration Statement, the information included therein.
(s) No action, suit or proceeding by or before any court or
governmental agency, authority or body or any arbitrator involving the
Company or any of its subsidiaries or its or
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their property is pending or, to the best knowledge of the Company,
threatened that (i) could reasonably be expected to have a material
adverse effect on the performance of this Agreement or the consummation
of any of the transactions contemplated hereby or (ii) could reasonably
be expected to have a material adverse effect on the condition
(financial or otherwise), prospects, earnings, 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 Final Prospectus (exclusive of any
supplement thereto).
(t) Neither the Company nor any of its subsidiaries is in
violation or default of (i) any provision of its charter or bylaws, (ii)
the terms of any indenture, contract, lease, mortgage, deed of trust,
note agreement, loan agreement or other agreement, obligation,
condition, covenant or instrument to which it is a party or bound or to
which its property is subject, except for such violations or defaults
which would not, individually or in the aggregate, have a material
adverse effect on the condition (financial or otherwise), prospects,
earnings, 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, or (iii) any statute, law, rule,
regulation, judgment, order or decree of any court, regulatory body,
administrative agency, governmental body, arbitrator or other authority
having jurisdiction over the Company or such subsidiary or any of its
properties, as applicable.
(u) Xxxxxx Xxxxxxxx LLP, who have certified certain financial
statements of the Company and its consolidated subsidiary and delivered
their report with respect to the audited consolidated financial
statements and schedules included in the Final Prospectus, are
independent public accountants with respect to the Company within the
meaning of the Act and the applicable published rules and regulations
thereunder.
(v) The Company has filed all foreign, federal, state and local
tax returns that are required to be filed or has requested extensions
thereof (except in any case in which the failure so to file would not
have a material adverse effect on the condition (financial or
otherwise), prospects, earnings, 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 Final Prospectus (exclusive of any supplement
thereto) and has paid all taxes required to be paid by it and any other
assessment, fine or penalty levied against it, to the extent that any of
the foregoing is due and payable, except for any such assessment, fine
or penalty that is currently being contested in good faith or as would
not have a material adverse effect on the condition (financial or
otherwise), prospects, earnings, 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 Final Prospectus (exclusive of any supplement
thereto).
(w) No labor problem or dispute with the employees of the Company
exists or is threatened or imminent, and the Company is not aware of any
existing or imminent labor
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disturbance by the employees of any of its principal suppliers,
contractors or customers, that could have a material adverse effect on
the condition (financial or otherwise), prospects, earnings, 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 Final Prospectus
(exclusive of any supplement thereto).
(x) The Company and each of its subsidiaries are insured by
insurers of recognized financial responsibility against such losses and
risks and in such amounts as are prudent and customary in the businesses
in which they are engaged; all policies of insurance and fidelity or
surety bonds insuring the Company or any of its subsidiaries or their
respective businesses, assets, employees, officers and directors are in
full force and effect; the Company and its subsidiaries are in
compliance with the terms of such policies and instruments in all
material respects; and there are no claims by the Company or any of its
subsidiaries under any such policy or instrument as to which any
insurance company is denying liability or defending under a reservation
of rights clause, except for such claims which, if successfully denied,
would not have a material adverse effect on the condition (financial or
otherwise), prospects, earnings, 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; neither the Company nor
any such subsidiary has been refused any insurance coverage sought or
applied for; and neither the Company nor any subsidiary has any reason
to believe that it will not be able to renew its existing insurance
coverage as and when such coverage expires or to obtain similar coverage
from similar insurers as may be necessary to continue its business at a
cost that would not have a material adverse effect on the condition
(financial or otherwise), prospects, earnings, 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 Final Prospectus (exclusive of any
supplement thereto).
(y) The Company and its subsidiaries possess all licenses,
certificates, permits and other authorizations issued by the appropriate
federal, state or foreign regulatory authorities necessary to conduct
their respective businesses, and neither the Company nor any subsidiary
has received any notice of proceedings relating to the revocation or
modification of any such certificate, authorization or permit which,
singly or in the aggregate, if the subject of an unfavorable decision,
ruling or finding, would have a material adverse effect on the condition
(financial or otherwise), prospects, earnings, 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 Final Prospectus (exclusive of any
supplement thereto).
(z) The Company and each of its subsidiaries maintains a system of
internal accounting controls sufficient to provide reasonable assurance
that (i) transactions are executed in accordance with management's
general or specific authorizations; (ii) transactions are recorded as
necessary to permit preparation of financial statements in
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conformity with generally accepted accounting principles and to maintain
asset accountability; (iii) access to assets is permitted only in
accordance with management's general or specific authorization; and (iv)
the recorded accountability for assets is compared with the existing
assets at reasonable intervals and appropriate action is taken with
respect to any differences.
(aa) The Company has not taken, directly or indirectly, any action
designed to or which has constituted or which might reasonably be
expected to cause or result, under the Exchange Act or otherwise, in
stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of the Senior Notes.
(bb) The Company and its subsidiaries are (i) in compliance with
any and all applicable foreign, federal, state and local laws and
regulations relating to the protection of human health and safety, the
environment or hazardous or toxic substances or wastes, pollutants or
contaminants ("Environmental Laws"), (ii) have received and are in
compliance with all permits, licenses or other approvals required of
them under applicable Environmental Laws to conduct their respective
businesses, and (iii) have not received notice of any actual or
potential liability for the investigation or remediation of any disposal
or release of hazardous or toxic substances or wastes, pollutants or
contaminants, except where such non-compliance with Environmental Laws,
failure to receive required permits, licenses or other approvals, or
liability would not, individually or in the aggregate, have a material
adverse effect on the condition (financial or otherwise), prospects,
earnings, 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 Final Prospectus (exclusive of any supplement thereto). Except as
set forth in the Final Prospectus, the Company has not been named as a
"potentially responsible party" under the Comprehensive Environmental
Response, Compensation, and Liability Act of 1980, as amended, except in
such instances which would not, individually or in the aggregate, have
a material adverse effect on the condition (financial or otherwise),
prospects, earnings, business or properties of the Company and its
subsidiaries, taken as a whole.
(cc) In the ordinary course of its business, the Company
periodically reviews the effect of Environmental Laws on the business,
operations and properties of the Company and its subsidiaries, in the
course of which it identifies and evaluates associated costs and
liabilities (including, without limitation, any capital or operating
expenditures required for clean-up, closure of properties or compliance
with Environmental Laws, or any permit, license or approval, any related
constraints on operating activities and any potential liabilities to
third parties). On the basis of such review, the Company has reasonably
concluded that such associated costs and liabilities would not, singly
or in the aggregate, have a material adverse effect on the condition
(financial or otherwise), prospects, earnings, 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 Final Prospectus (exclusive of any
supplement thereto).
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(dd) Each of the Company and its subsidiaries has fulfilled its
obligations, if any, under the minimum funding standards of Xxxxxxx 000
xx xxx Xxxxxx Xxxxxx Employee Retirement Income Security Act of 1974
("ERISA") and the regulations and published interpretations thereunder
with respect to each "plan" (as defined in Section 3(3) of ERISA and
such regulations and published interpretations) in which employees of
the Company and its subsidiaries are eligible to participate, and each
such plan is in compliance in all material respects with the presently
applicable provisions of ERISA and such regulations and published
interpretations. The Company and its subsidiaries have not incurred any
unpaid liability to the Pension Benefit Guaranty Corporation (other than
for the payment of premiums in the ordinary course) or to any such plan
under Title IV of ERISA.
(ee) The Company and its subsidiaries have implemented a
comprehensive, detailed program to analyze and address the risk that the
computer hardware and software used by it may be unable to recognize and
properly execute date-sensitive functions involving certain dates prior
to and any dates after December 31, 1999, and reasonably believes that
such risk will be remedied on a timely basis without material expense,
except as set forth or contemplated in the Final Prospectus, and will
not have a material adverse effect upon the financial condition and
results of operations of the Company and its subsidiaries, taken as a
whole.
Any certificate signed by any officer of the Company and delivered to
the Representatives or counsel for the Underwriters in connection with the
offering of the Senior Notes shall be deemed a representation and warranty by
the Company, as to matters covered thereby, to each Underwriter.
2. PURCHASE AND SALE. Subject to the terms and conditions and in
reliance upon the representations and warranties 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 Senior Notes
set forth opposite such Underwriter's name in Schedule II hereto.
3. DELIVERY AND PAYMENT. Delivery of and payment for the Senior
Notes shall be made on the date and at the time specified in Schedule I
hereto or at such time on such later date not more than three Business Days
after the foregoing date as the Representatives shall designate, which date
and time may be postponed by agreement between the Representatives and the
Company or as provided in Section 9 hereof (such date and time of delivery
and payment for the Senior Notes being herein called the "Closing Date").
Delivery of the Senior Notes shall be made to the Representatives for the
respective accounts of the several 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 an account specified by the Company. Delivery of the
Senior Notes shall be made through the facilities of The Depository Trust
Company.
4. OFFERING BY UNDERWRITERS. It is understood that the several
Underwriters propose to offer the Senior Notes for sale to the public as set
forth in the Final Prospectus.
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5. AGREEMENTS. The Company agrees with the several Underwriters
that:
(a) The Company will use its best efforts to cause the
Registration Statement, if not effective at the Execution Time, and any
amendment thereof, to become effective. Prior to the termination of the
offering of the Senior Notes, the Company will not file any amendment of
the Registration Statement or supplement (including the Final Prospectus
or any Preliminary Final Prospectus) to the Basic Prospectus or any Rule
462(b) Registration Statement unless the Company has furnished you a
copy for your review prior to filing and will not file any such proposed
amendment or supplement to which you reasonably object. Subject to the
foregoing sentence, if the Registration Statement has become or becomes
effective pursuant to Rule 430A, or filing of the Final Prospectus is
otherwise required under Rule 424(b), the Company will cause the Final
Prospectus, properly completed, and any supplement thereto to be filed
with the Commission pursuant to the applicable paragraph of Rule 424(b)
within the time period prescribed and will provide evidence satisfactory
to the Representatives of such timely filing. The Company will promptly
advise the Representatives (1) when the Registration Statement, if not
effective at the Execution Time, shall have become effective, (2) when
the Final Prospectus, and any supplement thereto, shall have been filed
(if required) with the Commission pursuant to Rule 424(b) or when any
Rule 462(b) Registration Statement shall have been filed with the
Commission, (3) when, prior to termination of the offering of the Senior
Notes, any amendment to the Registration Statement shall have been filed
or become effective, (4) of any request by the Commission or its staff
for any amendment of the Registration Statement, or any Rule 462(b)
Registration Statement, or for any supplement to the Final Prospectus or
for any additional information, (5) 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 (6) of the receipt by the Company of any notification with
respect to the suspension of the qualification of the Senior Notes for
sale in any jurisdiction or the institution or threatening of any
proceeding for such purpose. The Company will use its best efforts to
prevent the issuance of any such stop order or the suspension of any
such qualification and, if issued, to obtain as soon as possible the
withdrawal thereof.
(b) If, at any time when a prospectus relating to the Senior Notes
is required to be delivered under the Act, any event occurs as a result
of which the Final Prospectus as then supplemented would include any
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 the Registration Statement or supplement the Final
Prospectus to comply with the Act or the Exchange Act or the respective
rules thereunder, the Company promptly will (1) notify the
Representatives of such event, (2) prepare and file with the Commission,
subject to the second sentence of paragraph (a) of this Section 5, an
amendment or supplement which will correct such statement or omission or
effect such compliance, and (3) supply any supplemented Final Prospectus
to you in such quantities as you may reasonably request.
11
(c) As soon as practicable, the Company will make generally
available to its security holders and to the Representatives an earnings
statement or statements of the Company and its subsidiaries which will
satisfy the provisions of Section 11(a) of the Act and Rule 158 under
the Act.
(d) The Company will furnish to the Representatives and counsel
for the Underwriters, without charge, copies of the Registration
Statement (including exhibits thereto) and to each other Underwriter a
copy of the Registration Statement (without exhibits thereto) and, so
long as delivery of a prospectus by an Underwriter or dealer may be
required by the Act, as many copies of each Preliminary Final Prospectus
and the Final Prospectus and any supplement thereto as the
Representatives may reasonably request. The Company will pay the
expenses of printing or other production of all documents relating to
the offering.
(e) The Company will arrange, if necessary, for the qualification of
the Senior Notes for sale under the laws of such jurisdictions as the
Representatives may designate and will maintain such qualifications in
effect so long as required for the distribution of the Senior 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 to 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 Senior Notes, in any
jurisdiction where it is not now so subject.
(f) Until the Business Day set forth on Schedule I hereto, the
Company will not, without the prior written consent of Xxxxxxx Xxxxx
Xxxxxx, offer, sell or contract to sell, or otherwise dispose of (or enter
into any transaction which is designed to, or might reasonably be expected
to, result in the disposition (whether by actual disposition or effective
economic disposition due to cash settlement or otherwise) by the Company or
any affiliate of the Company or any person in privity with the Company or
any affiliate of the Company) directly or indirectly, or announce the
offering of, any debt securities issued or guaranteed by the Company (other
than the Senior Notes, commercial paper or other short-term debt).
(g) The Company will not take, directly or indirectly, any action
designed to or which has constituted or which might reasonably be expected
to cause or result, under the Exchange Act or otherwise, in stabilization
or manipulation of the price of any security of the Company to facilitate
the sale or resale of the Senior Notes.
(h) The Company will issue and deliver the Collateral Bonds to the
Senior Trustee as security for the Senior Notes in the manner described in
the Final Prospectus.
6. CONDITIONS TO THE OBLIGATIONS OF THE UNDERWRITERS. The
obligations of the Underwriters to purchase the Senior Notes shall be subject to
the accuracy of the representations and warranties on the part of the Company
contained herein as of the Execution Time and the Closing Date, to the accuracy
of the statements of the Company made in any certificates pursuant to the
12
provisions hereof, to the performance by the Company of its obligations
hereunder and to the following additional conditions:
(a) If the Registration Statement has not become effective prior to
the Execution Time, unless the Representatives agree in writing to a later
time, the Registration Statement will become effective not later than
(i) 6:00 PM New York City time, on the date of determination of the public
offering price, if such determination occurred at or prior to 3:00 PM New
York City time on such date, or (ii) 9:30 AM on the Business Day following
the day on which the public offering price was determined, if such
determination occurred after 3:00 PM New York City time on such date; if
filing of the Final Prospectus, or any supplement thereto, is required
pursuant to Rule 424(b), the Final Prospectus, and any such supplement,
will be filed in the manner and within the time period required by
Rule 424(b); and no stop order suspending the effectiveness of the
Registration Statement shall have been issued and no proceedings for that
purpose shall have been instituted or threatened.
(b) The Company shall have requested and caused Xxxxx & Lardner,
counsel for the Company, to have furnished to the Representatives their
opinion, dated the Closing Date and addressed to the Representatives, to
the effect that:
(i) The Company has been duly incorporated and is validly
existing as a corporation under the laws of the State of Wisconsin,
with full corporate power and authority to own or lease, as the case
may be, and to operate its properties and conduct its business as
described in the Final Prospectus, and is duly qualified to do
business as a foreign corporation and is in good standing under the
laws of Michigan; the Company is a "public utility company," as such
term is defined under the Public Utility Holding Company Act.
(ii) All of the Company's issued and outstanding shares of
common stock are owned of record by WPSR; the Company's authorized
preferred stock is as set forth in the Final Prospectus; to the
knowledge of such counsel, except as set forth in the Final
Prospectus, no options, warrants or other rights to purchase,
agreements or other obligations to issue, or rights to convert any
obligations into or exchange any securities for, shares of capital
stock of or ownership interests in the Company are outstanding.
(iii) To the knowledge of such counsel, there is no pending or
threatened action, suit or proceeding by or before any court or
governmental agency, authority or body or any arbitrator involving the
Company or any of its subsidiaries or its or their property, of a
character required to be disclosed in the Registration Statement which
is not adequately disclosed in the Final Prospectus, and there is no
franchise, contract or other document of a character required to be
described in the Registration Statement or Final Prospectus, or to be
filed as an exhibit thereto, which is not described or filed as
required.
13
(iv) The Registration Statement has become effective under the
Act; any required filing of the Basic Prospectus, any Preliminary
Final Prospectus and the Final Prospectus, and any supplements
thereto, pursuant to Rule 424(b) has been made in the manner and
within the time period required by Rule 424(b); to the knowledge of
such counsel, no stop order suspending the effectiveness of the
Registration Statement has been issued, no proceedings for that
purpose have been instituted or threatened, and the Registration
Statement and the Final Prospectus (other than the financial
statements and other financial information contained therein, as to
which such counsel need express no opinion) comply as to form in all
material respects with the applicable requirements of the Act, the
Exchange Act and the Trust Indenture Act and the respective rules
thereunder; and such counsel has no reason to believe that on the
Effective Date or at the Execution Time the Registration Statement
contained any untrue statement of a material fact or omitted to state
any material fact required to be stated therein or necessary to make
the statements therein not misleading or that the Final Prospectus as
of its date and on the Closing Date included or includes any untrue
statement of a material fact or omitted or omits to state a material
fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading (in each
case, other than the financial statements and other financial
information contained therein, as to which such counsel need express
no opinion).
(v) This Agreement has been duly authorized, executed and
delivered by the Company.
(vi) The Senior Indenture has been duly authorized, executed
and delivered by the Company and constitutes a valid and binding
instrument enforceable against the Company in accordance with its
terms, subject, as to enforcement of remedies, to the Bankruptcy
Exceptions; the Senior Indenture has been duly qualified under the
Trust Indenture Act; the Senior Indenture conforms in all material
respects to the description thereof contained in the Final Prospectus.
(vii) The Senior Notes have been duly authorized by the Company,
and when executed and authenticated in accordance with the provisions
of the Senior Indenture and delivered and paid for by the Underwriters
pursuant to this Agreement, will constitute valid and legally binding
obligations of the Company entitled to the benefits and security
provided by the Senior Indenture and enforceable against the Company
in accordance with their terms, subject, as to enforcement of
remedies, to the Bankruptcy Exceptions; the Senior Notes conform in
all material respects to the description thereof contained in the
Final Prospectus.
(viii) The Mortgage Indenture has been duly authorized, executed
and delivered by the Company and constitutes a valid and binding
instrument, enforceable against the Company in accordance with its
terms, except as the same
14
may be limited by the laws of the States of Wisconsin and Michigan
affecting the remedies for the enforcement of the security provided
for therein (which laws do not in such counsel's opinion make such
remedies inadequate for the realization of the benefits of such
security) and by the Bankruptcy Exceptions; the Mortgage Indenture
conforms in all material respects to the description thereof
contained in the Final Prospectus.
(ix) The Collateral Bonds have been duly authorized by the
Company and, when executed and authenticated in accordance with the
provisions of the Mortgage Indenture, and issued, pledged and
delivered to the Senior Trustee pursuant to the Senior Indenture as
security for the Senior Notes, will constitute valid and legally
binding obligations of the Company, secured by the lien of, and
entitled to the benefits provided by, the Mortgage Indenture, equally
and ratably with all other bonds of the Company duly issued and
outstanding under the Mortgage Indenture, and will be enforceable
against the Company in accordance with their terms, except as the same
may be limited by the laws of the States of Wisconsin and Michigan
affecting the remedies for the enforcement of the security provided
for therein (which laws do not in such counsel's opinion make such
remedies inadequate for the realization of the benefits of such
security) and by the Bankruptcy Exceptions; the Collateral Bonds
conform in all material respects to the description thereof contained
in the Final Prospectus.
(x) The Company has good and marketable title to the real
and fixed properties described in the Mortgage Indenture (other
than properties disposed of and released thereunder and lands
described as held only under flowage rights) free and clear of all
liens, charges and encumbrances against the same prior to or on a
parity with the lien of the Mortgage Indenture, except for and
subject only to permissible encumbrances as defined in the Mortgage
Indenture and to such exceptions, defects and qualifications as in
such counsel's opinion do not materially affect the security for
the Collateral Bonds or the Company's title to or its right to use
such properties in the conduct of its business; the Mortgage
Indenture constitutes a valid and direct first lien upon all real
and fixed property and governmental licenses and permits owned by
the Company (including its interests as tenant-in-common), except
property specifically excepted from the Mortgage Indenture by the
terms thereof, subject to no liens or encumbrances prior to or on a
parity with the lien of the Mortgage Indenture, except permissible
encumbrances as defined in the Mortgage Indenture; and the
description in the Mortgage Indenture of said property is adequate
to constitute the Mortgage Indenture a lien thereon. No examination
of title covering rights-of-way for transmission and distribution
lines has been made inasmuch as the Company has been advised that
the expense incident to the obtaining of abstracts or certificates
of title and of examinations in respect thereto would be in excess
of the cost of reacquiring by condemnation or purchase, possession
and use of such parts of such rights-of-way
15
as might be held under defective titles, and accordingly, such
opinion does not cover such rights-of-way. Such counsel has
relied on certificates of officers of the Company to the effect
that certain parcels described in the Mortgage Indenture are
rights-of-way and that certain parcels are not required as an
integral part of the Company's properties or are not indispensable
to its operations. All real property hereafter acquired by the
Company and located in counties in which the Mortgage Indenture
shall be of record will, upon acquisition, become subject to the
lien of the Mortgage Indenture, subject, however, to permitted
encumbrances and liens (as defined in the Mortgage Indenture), any
liens existing or placed thereon at acquisition and any liens which
might intervene prior to the filing or recording of the instrument
containing a sufficient legal description confirming of record that
such property is subject to the lien of the Mortgage Indenture,
except as the existence or validity of the lien of the Mortgage
Indenture may be affected by the application of Sections 547 and/or
552 of the U.S. Bankruptcy Code or by analogous provisions of
applicable state insolvency laws.
(xi) The Mortgage Indenture has been duly recorded or filed for
record in each county in the States of Wisconsin and Michigan where
any real properties described in such instrument are located and in
all other places required by law in order to perfect the lien upon the
property described in the Mortgage Indenture.
(xii) The Company has statutory authority, franchises, and
consents free from burdensome restrictions and adequate for the
conduct of the business in which it is engaged as described in the
Final Prospectus, except to the extent that the absence of such
statutory authority or the failure to obtain such franchises or
consents would not, singly or in the aggregate, (A) affect the
security for the Collateral Bonds, or (B) have a material adverse
effect on the condition (financial or otherwise), prospects, earnings,
business or properties of the Company, whether or not arising from
transactions in the ordinary course of business, except as set forth
or contemplated in the Final Prospectus.
(xiii) The issuance and delivery by the Company of the Collateral
Bonds to the Trustee constitute a sale by the Company of the
Collateral Bonds to the Trustee as of the Closing Date or, if not a
sale, the grant by the Company to the Trustee of a perfected security
interest in the Collateral Bonds for the benefit of the holders of the
Senior Notes.
(xiv) The Company is not and, after giving effect to the
offering and sale of the Senior Notes and the application of the
proceeds thereof as described in the Final Prospectus, will not be an
"investment company" as defined in the Investment Company Act of 1940,
as amended.
16
(xv) The Public Service Commission of Wisconsin has duly
authorized the issuance and sale by the Company of the Senior Notes
and the issuance and pledge of the Collateral Bonds on the terms set
forth in the Final Prospectus and this Agreement, and such
authorization is, to the best knowledge of such counsel, in force and
effect and sufficient for the issuance and sale of the Senior Notes to
the Underwriters and the issuance and pledge of the Collateral Bonds
to the Senior Trustee. No consent, approval, authorization, filing
with or order of any court or other governmental agency or body is
required in connection with the transactions contemplated herein,
except such as have been obtained under the Act and the Trust
Indenture Act and such as may be required under the blue sky laws of
any jurisdiction in connection with the purchase and distribution of
the Senior Notes by the Underwriters in the manner contemplated herein
and in the Final Prospectus.
(xvi) The execution and delivery of the Senior Indenture or the
Supplemental Indenture to the Mortgage Indenture, the issuance and
sale of the Senior Notes, the issuance and pledge of the Collateral
Bonds, the consummation of any other of the transactions herein
contemplated or the fulfillment of the terms hereof will not conflict
with, result in a breach or violation of or imposition of any lien,
charge or encumbrance upon any property or assets of the Company
pursuant to, (i) the charter or by-laws of the Company, (ii) the terms
of any indenture, contract, lease, mortgage, deed of trust, note
agreement, loan agreement or other agreement, obligation, condition,
covenant or instrument (other than the lien of the Mortgage Indenture)
known to such counsel to which the Company is a party or bound or to
which its property is subject, (iii) any statute, law, rule, or
regulation applicable to the Company, or (iv) any judgment, order or
decree known to such counsel and applicable to the Company of any
court, regulatory body, administrative agency, governmental body,
arbitrator or other authority having jurisdiction over the Company or
any of its properties.
(xvii) To the knowledge of such counsel, no holders of securities
of the Company have rights to the registration of such securities
under the Registration Statement.
In rendering such opinion, such counsel (A) may rely as to matters
involving the application of laws of any jurisdiction other than the State
of Wisconsin or the Federal laws of the United States, to the extent they
deem proper and specified in such opinion, upon the opinion of other
counsel of good standing whom they believe to be reliable and who are
satisfactory to counsel for the Underwriters, (B) may assume, as to matters
of New York law relating to this Agreement, that New York law does not
differ from Wisconsin law in any material respect, and (C) may rely, as to
matters of fact, to the extent they deem proper, on certificates of
responsible officers of the Company and public officials. References to
the Final Prospectus in this paragraph (b) include any supplements thereto
at the Closing Date.
17
(c) The Representatives shall have received from Xxxxxx Xxxxxx &
Xxxxx, counsel for the Underwriters, such opinion or opinions, dated the
Closing Date and addressed to the Representatives, with respect to the
issuance and sale of the Senior Notes, the issuance and pledge of the
Collateral Bonds, the Senior Indenture, the Mortgage Indenture, the
Registration Statement, the Final Prospectus (together with any supplement
thereto) 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 Chairman of the Board or the
President and the principal financial or accounting officer of the Company,
dated the Closing Date, to the effect that the signers of such certificate
have carefully examined the Registration Statement, the Final Prospectus,
any supplements to the Final 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 at or prior to
the Closing Date;
(ii) no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that
purpose have been instituted or, to the Company's knowledge,
threatened; and
(iii) since the date of the most recent financial statements
included or incorporated by reference in the Final Prospectus
(exclusive of any supplement thereto), there has been no material
adverse effect on the condition (financial or otherwise), prospects,
earnings, business or properties of the Company, whether or not
arising from transactions in the ordinary course of business, except
as set forth in or contemplated in the Final Prospectus (exclusive of
any supplement thereto).
(e) The Company shall have requested and caused Xxxxxx Xxxxxxxx LLP
to have furnished to the Representatives, at the Execution Time and at the
Closing Date, letters, (which may refer to letters previously delivered to
one or more of the Representatives), dated respectively as of the Execution
Time and as of the Closing Date, in form and substance satisfactory to the
Representatives, confirming that they are independent accountants within
the meaning of the Act and the Exchange Act and the respective applicable
published rules and regulations thereunder and stating in effect, except as
provided in Schedule I hereto, that:
(i) in their opinion the audited financial statements and
financial statement schedules included or incorporated by reference in
the Registration Statement and the Final Prospectus and reported on by
them comply as to form in all
18
material respects with the applicable accounting requirements of the
Act and the Exchange Act and the related published rules and
regulations;
(ii) on the basis of a reading of the latest unaudited
financial statements made available by the Company and its
subsidiaries; carrying out certain specified procedures (but not an
examination in accordance with generally accepted auditing standards)
which would not necessarily reveal matters of significance with
respect to the comments set forth in such letter; a reading of the
minutes of the meetings of the stockholders and directors of the
Company; and inquiries of certain officials of the Company who have
responsibility for financial and accounting matters of the Company and
its subsidiaries as to transactions and events subsequent to December
31, 1997, nothing came to their attention which caused them to believe
that:
(1) any unaudited financial statements included or
incorporated by reference in the Registration Statement and the
Final Prospectus do not comply as to form in all material
respects with applicable accounting requirements of the Act and
with the published rules and regulations of the Commission with
respect to financial statements included or incorporated by
reference in quarterly reports on Form 10-Q under the Exchange
Act; and said unaudited financial statements are not in
conformity with generally accepted accounting principles applied
on a basis substantially consistent with that of the audited
financial statements included or incorporated by reference in the
Registration Statement and the Final Prospectus;
(2) with respect to the period subsequent to September
30, 1998, there were any changes, at a specified date not more
than five days prior to the date of the letter, in the
consolidated long-term debt of the Company or capital stock of
the Company or decreases in consolidated net assets or
stockholders' equity of the Company as compared with the amounts
shown on the September 30, 1998 consolidated balance sheet
included or incorporated by reference in the Registration
Statement and the Final Prospectus, or for the period from
October 1, 1998 to such specified date there were any decreases,
as compared with the corresponding period in the preceding year,
in consolidated operating revenues or in income before
extraordinary items or net income of the Company, except in all
instances for changes or decreases set forth in such letter, in
which case the letter shall be accompanied by an explanation by
the Company as to the significance thereof unless said
explanation is not deemed necessary by the Representatives; or
(3) the information included or incorporated by
reference in the Registration Statement and Final Prospectus in
response to Regulation S-K, Item 301 (Selected Financial Data)
and Item 503(d) (Ratio of Earnings to
19
Fixed Charges) is not in conformity with the applicable
disclosure requirements of Regulation S-K; and
(iii) they have performed certain other specified procedures as
a result of which they determined that certain information of an
accounting, financial or statistical nature (which is limited to
accounting, financial or statistical information derived from the
general accounting records of the Company and its subsidiaries) set
forth in the Registration Statement and the Final Prospectus and in
Exhibit 12 to the Registration Statement, including the information
set forth under the captions "Summary Financial Information" and
"Ratios of Earnings to Fixed Charges " in the Final Prospectus, the
information included or incorporated by reference in Items 1, 2, 6,
and 7 of the Company's Annual Report on Form 10-K, incorporated by
reference in the Registration Statement and the Final Prospectus, and
the information included in the "Management's Discussion and Analysis
of Financial Condition and Results of Operations" included or
incorporated by reference in the Company's Quarterly Reports on
Form 10-Q, incorporated by reference in the Registration Statement and
the Final Prospectus, agrees with the accounting records of the
Company and its subsidiaries, excluding any questions of legal
interpretation.
References to the Final Prospectus in this paragraph (e) include any
supplement thereto at the date of the letter.
(f) Subsequent to the Execution Time or, if earlier, the dates as of
which information is given in the Registration Statement (exclusive of any
amendment thereof) and the Final Prospectus (exclusive of any supplement
thereto), there shall not have been (i) any change or decrease specified in
the letter or letters referred to in paragraph (e) of this Section 6 or
(ii) any change, or any development involving a prospective change, in or
affecting the condition (financial or otherwise), earnings, 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 Final Prospectus (exclusive of any
supplement thereto) the effect of which, in any case referred to in
clause (i) or (ii) above, is so material and adverse as to make it
impractical or inadvisable to proceed with the offering or delivery of the
Senior Notes as contemplated by the Registration Statement (exclusive of
any amendment thereof) and the Final Prospectus (exclusive of any
supplement thereto).
(g) Subsequent to the Execution Time, there shall not have been any
decrease in the rating of any of the Company's debt securities (including
the Senior Notes) by any "nationally recognized statistical rating
organization" (as defined for purposes of Rule 436(g) under the Act) or any
notice given of any intended or potential decrease in any such rating or of
a possible change in any such rating that does not indicate the direction
of the possible change.
20
(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 6 shall not have
been fulfilled in all material respects when and as provided in this
Agreement, or if any of the opinions and 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 counsel for the
Underwriters, 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 6 shall be
delivered at the office of Xxxxx & Xxxxxxx, counsel for the Company, at 000
Xxxx Xxxxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxx 00000, on the Closing Date, or at
such other place as may be agreed upon by the Company and the Underwriters.
7. REIMBURSEMENT OF UNDERWRITERS' EXPENSES. If the sale of the
Senior Notes provided for herein is not consummated because any condition to
the obligations of the Underwriters set forth in Section 6 hereof 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 provision hereof other than
by reason of a default by any of the Underwriters, the Company will reimburse
the Underwriters severally through Xxxxxxx Xxxxx Barney on 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 Senior 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 for the registration of the Senior Notes as originally filed or in
any amendment thereof, or in the Basic Prospectus, any Preliminary Final
Prospectus or the Final 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 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
21
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. 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, each of its directors, each of its officers
who signs the Registration Statement, 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.
(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 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
22
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 unavailable to or insufficient to hold harmless an
indemnified party for any reason, the Company and the Underwriters severally
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 Senior
Notes; PROVIDED, HOWEVER, that in no case shall any Underwriter (except as
may be provided in any agreement among underwriters relating to the offering
of the Senior Notes) be responsible for any amount in excess of the
underwriting discount or commission applicable to the Senior Notes purchased
by such Underwriter hereunder. If the allocation provided by the immediately
preceding sentence is unavailable for any reason, the Company and the
Underwriters severally 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 underwriting discounts
and commissions, in each case as set forth on the cover page of the Final
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, access to
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 Underwriter 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, each officer of the
Company who shall have signed the Registration Statement and each director 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 Senior Notes agreed to be
purchased by such Underwriter or
23
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 principal amount of Senior Notes
set forth opposite their names in Schedule II hereto bears to the aggregate
principal amount of Senior Notes set forth opposite the names of all the
remaining Underwriters) the Senior Notes which the defaulting Underwriter or
Underwriters agreed but failed to purchase; PROVIDED, HOWEVER, that in the
event that the aggregate principal amount of Senior Notes which the
defaulting Underwriter or Underwriters agreed but failed to purchase shall
exceed 10% of the aggregate principal amount of Senior 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
Senior Notes, and if such nondefaulting Underwriters do not purchase all the
Senior 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 Final Prospectus 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
and 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 Senior Notes, if at any time
prior to such time (i) trading in WPSR'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, New
York State or Wisconsin 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, impractical or inadvisable to proceed with the offering or
delivery of the Senior Notes as contemplated by the Final Prospectus
(exclusive of any supplement thereto).
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 any Underwriter 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 Senior
Notes. The provisions of Sections 7 and 8 hereof shall survive the
termination or cancellation of this Agreement.
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 the Xxxxxxx Xxxxx Xxxxxx General Counsel
(fax no.: (000) 000-0000) and confirmed to the General Counsel, Xxxxxxx Xxxxx
Barney, at 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, 00000, Attention:
General
24
Counsel; or, if sent to the Company, will be mailed, delivered or telefaxed
to Xxxxx X. Xxxxxx, Wisconsin Public Service Corporation (fax no: (920)
000-0000) and confirmed to Wisconsin Public Service Corporation, 000 Xxxxx
Xxxxx Xxxxxx, X.X. Xxx 00000, Xxxxx Xxx, Xxxxxxxxx, 00000, Attention:
Treasurer.
13. SUCCESSORS. This Agreement will inure to the benefit of and
be binding upon the parties hereto and their respective successors 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.
14. 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.
15. COUNTERPARTS. This Agreement may be signed in one or more
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same agreement.
16. HEADINGS. The section headings used herein are for
convenience only and shall not affect the construction hereof.
17. DEFINITIONS. The terms which follow, when used in this
Agreement, shall have the meanings indicated.
"Act" shall mean the Securities Act of 1933, as amended and the rules
and regulations of the Commission promulgated thereunder.
"Basic Prospectus" shall mean the prospectus referred to in paragraph
1(a) above contained in the Registration Statement at the Effective Date
including any Preliminary Final Prospectus.
"Business Day" shall mean any day other than a Saturday, a Sunday or a
legal holiday or a day on which banking institutions or trust companies are
authorized or obligated by law to close in New York City or Milwaukee,
Wisconsin.
"Commission" shall mean the Securities and Exchange Commission.
"Effective Date" shall mean each date and time that the Registration
Statement, any post-effective amendment or amendments thereto and any
Rule 462(b) Registration Statement became or become effective.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Commission promulgated
thereunder.
25
"Execution Time" shall mean the date and time that this Agreement is
executed and delivered by the parties hereto.
"Final Prospectus" shall mean the prospectus supplement relating to
the Senior Notes that was first filed pursuant to Rule 424(b) after the
Execution Time, together with the Basic Prospectus.
"Preliminary Final Prospectus" shall mean any preliminary prospectus
supplement to the Basic Prospectus which describes the Senior Notes and the
offering thereof and is used prior to filing of the Final Prospectus,
together with the Basic Prospectus.
"Registration Statement" shall mean the registration statement
referred to in paragraph 1(a) above, including exhibits and financial
statements, as amended at the Execution Time (or, if not effective at the
Execution Time, in the form in which it shall become effective) and, in the
event any post-effective amendment thereto or any Rule 462(b) Registration
Statement becomes effective prior to the Closing Date, shall also mean such
registration statement as so amended or such Rule 462(b) Registration
Statement, as the case may be. Such term shall include any Rule 430A
Information deemed to be included therein at the Effective Date as provided
by Rule 430A.
"Rule 415", "Rule 424", "Rule 430A" and "Rule 462" refer to such rules
under the Act.
"Rule 430A Information" shall mean information with respect to the
Senior Notes and the offering thereof permitted to be omitted from the
Registration Statement when it becomes effective pursuant to Rule 430A.
"Rule 462(b) Registration Statement" shall mean a registration
statement and any amendments thereto filed pursuant to Rule 462(b) relating
to the offering covered by the registration statement referred to in
Section 1(a) hereof.
"Trust Indenture Act" shall mean the Trust Indenture Act of 1939, as
amended and the rules and regulations of the Commission promulgated
thereunder.
26
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof,
whereupon this letter and your acceptance shall represent a binding agreement
among the Company and the several Underwriters.
Very truly yours,
Wisconsin Public Service Corporation
By: /s/ Xxxxxx X. Xxxxxxx
----------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Senior Vice President-Finance
The foregoing Agreement is
hereby confirmed and accepted
as of the date specified in
Schedule I hereto.
Xxxxxxx Xxxxx Xxxxxx Inc.
X.X. Xxxxxxx & Sons, Inc.
Xxxx Xxxxx Xxxx Xxxxxx, Incorporated
By: Xxxxxxx Xxxxx Barney Inc.
By: /s/ Xxxxxx Xxxxxxxx
----------------------
Name: Xxxxxx Xxxxxxxx
Title: Managing Director
For themselves and the other
several Underwriters, if any,
named in Schedule II to
the foregoing Agreement.
27
SCHEDULE I
Underwriting Agreement dated December 14, 1998
Registration Statement No. 333-67979
Representative(s): Xxxxxxx Xxxxx Xxxxxx Inc.
X.X. Xxxxxxx & Sons, Inc.
Xxxx Xxxxx Xxxx Xxxxxx, Incorporated
Title, Purchase Price and Description of Senior Notes:
Title: 6.08% Senior Notes due December 1, 2028
Principal amount: $50,000,000
Purchase price (include
accrued interest or
amortization, if any): $50,168,888.89
Sinking fund provisions: None
Redemption provisions: The Senior Notes will be redeemable at the
option of the Company in whole at any time or
in part from time to time, at a price equal
to the greater of (i) 100% of their principal
amount or (ii) the sum of the present values
of the remaining scheduled payments of
principal and interest thereon discounted to
the date of redemption on a semiannual basis
(assuming a 360-day year consisting of twelve
30-day months) at the Treasury Yield as
defined in the Prospectus Supplement and
Supplemental Senior Indenture for the Senior
Notes plus 20 basis points, plus in each case
accrued interest to the date of redemption.
Other provisions: None other than those substantially in the
form set forth in the forms of Indenture
relating to the Senior Debt Securities and
Supplemental Indenture relating to the Senior
Debt Securities filed as Exhibits 4A and 4C
to the Company's Registration Statement on
Form S-3 (Reg. No. 333-67979)
Closing Date, Time and Location: December 21, 1998 at 10:00 a.m. at the
offices of Xxxxx & Lardner, Milwaukee,
Wisconsin
Type of Offering: Non-delayed
Date referred to in Section 5(f) after which the Company may offer or sell
debt securities issued or guaranteed by the Company without the consent of
the Representatives: December 21, 1998
Modification of items to be covered by the letter from Xxxxxx Xxxxxxxx LLP
delivered pursuant to Section 6(e) at the Execution Time: NONE
2
SCHEDULE II
Principal Amount
of Senior Notes to
Underwriters be Purchased
------------ -------------------
Xxxxxxx Xxxxx Barney Inc. $ 32,500,000
X.X. Xxxxxxx & Sons, Inc. 12,500,000
Xxxx Xxxxx Xxxx Xxxxxx, Incorporated 5,000,000
------------
Total: $ 50,000,000
------------
------------
