Draft of 8/13/97
EXHIBIT 1.01
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NORTHERN STATES POWER COMPANY
(a Minnesota corporation)
3,200,0000 Shares of Common Stock
U.S. PURCHASE AGREEMENT
Dated: , 1997
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TABLE OF CONTENTS
SECTION 1. Representations and Warranties. . . . . . . . . . . . . . . . . .4
(a) Representations and Warranties by the Company . . . . . . . . . .4
(i) Compliance with Registration Requirements . . . . . . . .4
(ii) Incorporated Documents. . . . . . . . . . . . . . . . . .4
(iii) Independent Accountants . . . . . . . . . . . . . . . . .5
(iv) Financial Statements. . . . . . . . . . . . . . . . . . .5
(v) No Material Adverse Change in Business. . . . . . . . . .5
(vi) Good Standing of the Company. . . . . . . . . . . . . . .5
(vii) Good Standing of Subsidiaries . . . . . . . . . . . . . .6
(viii) Capitalization. . . . . . . . . . . . . . . . . . . . . .6
(ix) Authorization of Agreement. . . . . . . . . . . . . . . .6
(x) Authorization and Description of Securities . . . . . . .6
(xi) Absence of Defaults and Conflicts . . . . . . . . . . . .7
(xii) Absence of Labor Dispute. . . . . . . . . . . . . . . . .7
(xiii) Absence of Proceedings. . . . . . . . . . . . . . . . . .7
(xiv) Accuracy of Exhibits. . . . . . . . . . . . . . . . . . .8
(xv) Possession of Intellectual Property . . . . . . . . . . .8
(xvi) Absence of Further Requirements . . . . . . . . . . . . .8
(xvii) Possession of Licenses and Permits. . . . . . . . . . . .8
(xviii) Title to Property . . . . . . . . . . . . . . . . . . . .9
(xix) Compliance with Cuba Act. . . . . . . . . . . . . . . . .9
(xx) Investment Company Act. . . . . . . . . . . . . . . . . .9
(xxi) Environmental Laws. . . . . . . . . . . . . . . . . . . .9
(b) Officer's Certificates. . . . . . . . . . . . . . . . . . . . . 10
SECTION 2. Sale and Delivery to U.S. Underwriters; Closing . . . . . . . . 10
(a) U.S. Initial Securities . . . . . . . . . . . . . . . . . . . . 10
(b) U.S. Option Securities. . . . . . . . . . . . . . . . . . . . . 10
(c) Payment . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
(d) Denominations; Registration . . . . . . . . . . . . . . . . . . 11
SECTION 3. Covenants of the Company. . . . . . . . . . . . . . . . . . . . 11
(a) Compliance with Securities Regulations and Commission Requests. 11
(b) Filing of Amendments. . . . . . . . . . . . . . . . . . . . . . 12
(c) Delivery of Registration Statements . . . . . . . . . . . . . . 12
(d) Delivery of Prospectuses. . . . . . . . . . . . . . . . . . . . 12
(e) Continued Compliance with Securities Laws . . . . . . . . . . . 12
(f) Blue Sky Qualifications . . . . . . . . . . . . . . . . . . . . 13
(g) Rule 158. . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
(h) Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . 13
(i) Listing . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
(j) Restriction on Sale of Securities . . . . . . . . . . . . . . . 13
(k) Reporting Requirements. . . . . . . . . . . . . . . . . . . . . 14
SECTION 4. Payment of Expenses . . . . . . . . . . . . . . . . . . . . . . 14
i
(a) Expenses.... . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
(b) Termination of Agreement . . . . . . . . . . . . . . . . . . . 14
SECTION 5. Conditions of U.S. Underwriters' Obligations . . . . . . . . . 15
(a) Effectiveness of Registration Statement. . . . . . . . . . . . 15
(b) Opinion of Counsel for Company . . . . . . . . . . . . . . . . 15
(c) Opinion of Counsel for U.S. Underwriters . . . . . . . . . . . 15
(d) Officers' Certificate. . . . . . . . . . . . . . . . . . . . . 15
(e) Accountant's Comfort Letter. . . . . . . . . . . . . . . . . . 16
(f) Bring-down Comfort Letter. . . . . . . . . . . . . . . . . . . 16
(g) Approval of Listing. . . . . . . . . . . . . . . . . . . . . . 16
(i) Conditions to Purchase of U.S. Option Securities . . . . . . . 16
(i) Officers' Certificate . . . . . . . . . . . . . . . . . 16
(ii) Opinion of Counsel for Company. . . . . . . . . . . . . 17
(iii) Opinion of Counsel for U.S. Underwriters. . . . . . . . 17
(iv) Bring-down Comfort Letter . . . . . . . . . . . . . . . 17
(j) Additional Documents . . . . . . . . . . . . . . . . . . . . . 17
(k) Termination of Agreement . . . . . . . . . . . . . . . . . . . 17
SECTION 6. Indemnification. . . . . . . . . . . . . . . . . . . . . . . . 17
(a) Indemnification of Underwriters. . . . . . . . . . . . . . . . 17
(b) Indemnification of Company, Directors and Officers . . . . . . 18
(c) Actions against Parties; Notification. . . . . . . . . . . . . 19
(d) Settlement without Consent if Failure to Reimburse . . . . . . 19
SECTION 7. Contribution . . . . . . . . . . . . . . . . . . . . . . . . . 19
SECTION 8. Representations, Warranties and Agreements to Survive Delivery.21
SECTION 9. Termination of Agreement . . . . . . . . . . . . . . . . . . . 21
(a) Termination; General . . . . . . . . . . . . . . . . . . . . . 21
(b) Liabilities. . . . . . . . . . . . . . . . . . . . . . . . . . 21
SECTION 10. Default by One or More of the U.S. Underwriters. . . . . . . . 21
SECTION 11. Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 12. Parties. . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 13. GOVERNING LAW AND TIME . . . . . . . . . . . . . . . . . . . . 23
SECTION 14. Effect of Headings . . . . . . . . . . . . . . . . . . . . . . 23
ii
Draft of 8/13/97
NORTHERN STATES POWER COMPANY
(a Minnesota corporation)
3,200,0000 Shares of Common Stock
(Par Value $2.50 Per Share)
U.S. PURCHASE AGREEMENT
, 1997
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XXXXXXX XXXXX & CO.
XXXXXXX XXXXX, XXXXXX, XXXXXX & XXXXX
INCORPORATED
XXXXXXX, XXXXX & CO.
XXXXXXX XXXXXXXX INC
XXXX XXXXXXXX INCORPORATED
XXXXX XXXXXXX INC.
as Representatives of the several Underwriters
c/x Xxxxxxx Xxxxx & Co.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
North Tower
World Financial Center
New York, New York 10281-1209
Ladies and Gentlemen:
Northern States Power Company, a Minnesota corporation (the "Company"),
confirms its agreement with Xxxxxxx Xxxxx & Co., Xxxxxxx Lynch, Xxxxxx, Xxxxxx &
Xxxxx Incorporated ("Xxxxxxx Xxxxx") and each of the other U.S. Underwriters
named in Schedule A hereto (collectively, the "U.S. Underwriters", which term
shall also include any underwriter substituted as hereinafter provided in
Section 10 hereof), for whom Xxxxxxx Xxxxx, Goldman, Sachs & Co., Salomon
Brothers Inc, Xxxx Xxxxxxxx Incorporated and Xxxxx Xxxxxxx Inc. are acting as
representatives (in such capacity, the "U.S. Representatives"), with respect to
(i) the sale by the Company and the purchase by the Underwriters, acting
severally and not jointly, of the respective numbers of shares of Common Stock,
par value $2.50 per share, of the Company ("Common Stock") set forth in Schedule
A hereto and (ii) the grant by the Company to the U.S. Underwriters, acting
severally and not jointly, of the option described in Section 2(b) hereof to
purchase all or any part of 480,000 additional shares of Common Stock to cover
over-allotments, if any. The aforesaid 3,200,0000 shares of Common Stock (the
"U.S. Initial Securities") to be
1
purchased by the U.S. Underwriters and all or any part of the 480,000 shares of
Common Stock subject to the option described in Section 2(b) hereof (the "U.S.
Option Securities") are hereinafter called, collectively, the "U.S.
Securities".
It is understood that the Company is concurrently entering into an
agreement dated the date hereof (the "International Purchase Agreement")
providing for the offering by the Company of an aggregate of 800,000 shares of
Common Stock (the "International Initial Securities") through arrangements with
certain underwriters outside the United States and Canada (the "International
Managers") for which Xxxxxxx Xxxxx International, Xxxxxxx, Xxxxx International,
Salomon Brothers International Limited, Xxxx Xxxxxxxx and Xxxxx Xxxxxxx are
acting as lead managers (the "Lead Managers") and the grant by the Company to
the International Managers, acting severally and not jointly, of an option to
purchase all or any part of the 800,000 additional shares of Common Stock solely
to cover overallotments, if any (the "International Option Securities" and,
together with the U.S. Option Securities, the "Option Securities"). The
International Initial Securities and the International Option Securities are
hereinafter called the "International Securities". It is understood that the
Company is not obligated to sell, and the U.S. Underwriters are not obligated to
purchase, any U.S. Initial Securities unless all of the International Initial
Securities are contemporaneously purchased by the International Managers.
The U.S. Underwriters and the International Managers are hereinafter
collectively called the "Underwriters", the U.S. Initial Securities and the
International Initial Securities are hereinafter collectively called the
"Initial Securities", and the U.S. Securities and the International Securities
are hereinafter collectively called the "Securities".
The Underwriters will concurrently enter into an Intersyndicate Agreement
of even date herewith (the "Intersyndicate Agreement") providing for the
coordination of certain transactions among the Underwriters under the direction
of Xxxxxxx Xxxxx.
The Company understands that the U.S. Underwriters propose to make a public
offering of the Securities as soon as the U.S. Representatives deem advisable
after this Agreement has been executed and delivered.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 333---) covering the
registration of the Securities under the Securities Act of 1933, as amended (the
"1933 Act"), including the related preliminary prospectus or prospectuses. Two
forms of prospectus are to be used in connection with the offering and sale of
the Securities: one relating to the U.S. Securities (the "Form of U.S.
Prospectus") and one relating to the International Securities (the "Form of
International Prospectus"). The Form of International Prospectus will be
identical to the Form of U.S. Prospectus, except for the front cover, inside
front cover and back cover page and the information under the caption
"Underwriting." Promptly after execution and delivery of this Agreement, the
Company will either (i) prepare and file a Form of U.S. Prospectus and a Form of
International Prospectus in accordance with the provisions of Rule 430A ("Rule
430A") of the rules and regulations of the Commission under the 1933 Act (the
"1933 Act Regulations") and paragraph (b) of Rule 424 ("Rule 424(b)") of the
1933 Act Regulations or (ii) if the Company
2
has elected to rely upon Rule 434 ("Rule 434") of the 1933 Act Regulations,
prepare and file term sheets (a "Term Sheet") in accordance with the provisions
of Rule 434 and Rule 424(b). The information included in each such prospectus
or in each such Term Sheet, as the case may be, that was omitted from such
registration statement at the time it became effective but that is deemed to be
part of such registration statement at the time it became effective (a) pursuant
to paragraph (b) of Rule 430A is referred to as "Rule 430A Information" or (b)
pursuant to paragraph (d) of Rule 434 is referred to as "Rule 434 Information."
Each prospectus used before such registration statement became effective, and
any prospectus that omitted, as applicable, the Rule 430A Information or the
Rule 434 Information, that was used after such effectiveness and prior to the
execution and delivery of this Agreement, is herein called a "preliminary
prospectus." Such registration statement, including the exhibits thereto,
schedules thereto, if any, and the documents incorporated by reference therein
pursuant to Item 12 of Form S-3 under the 1933 Act, at the time it became
effective and including the Rule 430A Information and the Rule 434 Information,
as applicable, is herein called the "Registration Statement." Any registration
statement filed pursuant to Rule 462(b) of the 1933 Act Regulations is herein
referred to as the "Rule 462(b) Registration Statement," and after such filing
the term "Registration Statement" shall include the Rule 462(b) Registration
Statement. The final Form of U.S. Prospectus and the final Form of
International Prospectus, including the documents incorporated by reference
therein pursuant to Item 12 of Form S-3 under the 1933 Act, in the form first
furnished to the Underwriters for use in connection with the offering of the
Securities is herein called the "U.S. Prospectus" and the "International
Prospectus," respectively, and collectively, the "Prospectuses" "Prospectus."
If Rule 434 is relied on, the term terms "U.S. Prospectus" and "International
Prospectus" shall refer to the preliminary U.S. Prospectus dated ----------,
1997 and preliminary International Prospectus dated ----------, 1997,
respectively, each together with the applicable Term Sheet and all references in
this Agreement to the date of the Prospectus shall mean the date of the
applicable Term Sheet. For purposes of this Agreement, all references to the
Registration Statement, any preliminary prospectus, the Prospectus, the U.S.
Prospectus, the International Prospectus or any Term Sheet or any amendment or
supplement to any of the foregoing shall be deemed to include the copy filed
with the Commission pursuant to its Electronic Data Gathering, Analysis and
Retrieval system ("XXXXX").
All references in this Agreement to financial statements and schedules and
other information which is "contained," "included" or "stated" in the
Registration Statement, any preliminary prospectus (including the Form of U.S.
Prospectus and Form of International Prospectus) or the Prospectuses (or other
references of like import) shall be deemed to mean and include all such
financial statements and schedules and other information which is incorporated
by reference in the Registration Statement, any preliminary prospectuses or the
Prospectuses, as the case may be; and all references in this Agreement to
amendments or supplements to the Registration Statement, any preliminary
prospectus or the Prospectuses shall be deemed to mean and include the filing of
any document under the Securities Exchange Act of 1934 (the "1934 Act") which is
incorporated by reference in the Registration Statement, such preliminary
prospectus or the Prospectuses, as the case may be.
3
SECTION 1. REPRESENTATIONS AND WARRANTIES.
(a) REPRESENTATIONS AND WARRANTIES BY THE COMPANY. The Company represents
and warrants to each U.S. Underwriter as of the date hereof, as of the Closing
Time referred to in Section 2(c) hereof, and as of each Date of Delivery (if
any) referred to in Section 2(b) hereof, and agrees with each U.S. Underwriter,
as follows:
(i) COMPLIANCE WITH REGISTRATION REQUIREMENTS. The Company meets the
requirements for use of Form S-3 under the 1933 Act. Each of the Registration
Statement and any Rule 462(b) Registration Statement has become effective under
the 1933 Act and no stop order suspending the effectiveness of the Registration
Statement or any Rule 462(b) Registration Statement has been issued under the
1933 Act and no proceedings for that purpose have been instituted or are pending
or, to the knowledge of the Company, are contemplated by the Commission, and any
request on the part of the Commission for additional information has been
complied with.
At the respective times the Registration Statement, any Rule 462(b)
Registration Statement and any post-effective amendments thereto became
effective and at the Closing Time (and, if any U.S. Option Securities are
purchased, at the Date of Delivery), the Registration Statement, the Rule 462(b)
Registration Statement and any amendments and supplements thereto complied and
will comply in all material respects with the requirements of the 1933 Act and
the 1933 Act Regulations and did not and will not contain an untrue statement of
a material fact or omit to state a material fact required to be stated therein
or necessary to make the statements therein not misleading. Neither the
Prospectuses nor any amendments or supplements thereto, at the time the
Prospectuses or any such amendment or supplement was issued and at the Closing
Time (and, if any U.S. Option Securities are purchased, at the Date of
Delivery), included or will include an untrue statement of a material fact or
omitted or will omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading. If Rule 434 is used, the Company will comply with the
requirements of Rule 434. The representations and warranties in this subsection
shall not apply to statements in or omissions from the Registration Statement or
U.S. Prospectus made in reliance upon and in conformity with information
furnished to the Company in writing by any U.S. Underwriter through Xxxxxxx
Xxxxx expressly for use in the Registration Statement or U.S. Prospectus.
Each preliminary prospectus and the prospectuses filed as part of the
Registration Statement as originally filed or as part of any amendment thereto,
or filed pursuant to Rule 424 under the 1933 Act, complied when so filed in all
material respects with the 1933 Act Regulations and each preliminary prospectus
and the Prospectuses delivered to the Underwriters for use in connection with
the offering of the Securities was identical to the electronically transmitted
copies thereof filed with the Commission pursuant to XXXXX, except to the extent
permitted by Regulation S-T.
(ii) INCORPORATED DOCUMENTS. The documents incorporated or deemed to be
incorporated by reference in the Registration Statement and the Prospectuses, at
the time they
4
were or hereafter are filed with the Commission, complied and will comply in all
material respects with the requirements of the 1934 Act and the rules and
regulations of the Commission thereunder (the "1934 Act Regulations"), and, when
read together with the other information in the Prospectuses, at the time the
Registration Statement became effective, at the time the Prospectuses were was
issued and at the Closing Time (and, if any U.S. Option Securities are
purchased, at the Date of Delivery), did not and will not contain an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading.
(iii) INDEPENDENT ACCOUNTANTS. The accountants who certified the
financial statements and supporting schedules included in the Registration
Statement are independent public accountants as required by the 1933 Act and the
1933 Act Regulations.
(iv) FINANCIAL STATEMENTS. The financial statements included in the
Registration Statement and the Prospectuses, together with the related schedules
and notes, present fairly the financial position of the Company and its
consolidated subsidiaries at the dates indicated and the statement of
operations, stockholders' equity and cash flows of the Company and its
consolidated subsidiaries for the periods specified; said financial statements
have been prepared in conformity with generally accepted accounting principles
("GAAP") applied on a consistent basis throughout the periods involved. The
supporting schedules, if any, included in the Registration Statement present
fairly in accordance with GAAP the information required to be stated therein.
The selected financial data and the summary financial information included in
the Prospectuses present fairly the information shown therein and have been
compiled on a basis consistent with that of the audited financial statements
included in the Registration Statement.
(v) NO MATERIAL ADVERSE CHANGE IN BUSINESS. Since the respective
dates as of which information is given in the Registration Statement and the
Prospectuses, except as otherwise stated therein, (A) there has been no material
adverse change in the condition, financial or otherwise, or in the earnings,
business affairs or business prospects of the Company and its subsidiaries
considered as one enterprise, whether or not arising in the ordinary course of
business (a "Material Adverse Effect"), (B) there have been no transactions
entered into by the Company or any of its subsidiaries, other than those in the
ordinary course of business, which are material with respect to the Company and
its subsidiaries considered as one enterprise, and (C) except for regular
dividends on the Common Stock and the Company's preferred stock in amounts per
share that are consistent with past practice, there has been no dividend or
distribution of any kind declared, paid or made by the Company on any class of
its capital stock.
(vi) GOOD STANDING OF THE COMPANY. The Company has been duly
organized and is validly existing as a corporation in good standing under the
laws of the State of Minnesota and has corporate power and authority to own,
lease and operate its properties and to conduct its business as described in the
Prospectuses and to enter into and perform its obligations under this Agreement
and the International Purchase Agreement; and the Company is duly qualified as a
foreign corporation to transact business and is in good standing in each other
jurisdiction in which such qualification is required, whether by reason of the
ownership or leasing or property
5
or the conduct of business, except where the failure so to qualify or be in good
standing would not result in a Material Adverse Effect.
(vii) GOOD STANDING OF SUBSIDIARIES. Each subsidiary of the Company
named in Exhibit 21.01 to the Company's Annual Report on Form 10-K for the year
ended December 31, 1996 ("Significant Subsidiary") has been duly organized and
is validly existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, has corporate power and authority to own,
lease and operate its properties and to conduct its business as described in the
Prospectuses and is duly qualified as a foreign corporation to transact business
and is in good standing in each jurisdiction in which such qualification is
required, whether by reason of the ownership or leasing of property or the
conduct of business, except where the failure so to qualify or to be in good
standing would not result in a Material Adverse Effect; except as otherwise
disclosed in the Registration Statement, all of the issued and outstanding
capital stock of each such Significant Subsidiary has been duly authorized and
validly issued, is fully paid and non-assessable and is owned by the Company,
directly or through subsidiaries, free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equity; none of the outstanding
shares of capital stock of any Significant Subsidiary was issued in violation of
the preemptive or similar rights of any securityholder of such Subsidiary. The
only subsidiaries of the Company are (a) the subsidiaries listed on Exhibit
21.01 to the Company's Annual Report on Form 10-K for the year ended December
31, 1996 and (b) certain other subsidiaries which, considered in the aggregate
as a single Subsidiary, do not constitute a "significant subsidiary" as defined
in Rule 1-02 of Regulation S-X.
(viii) CAPITALIZATION. The authorized, issued and outstanding capital
stock of the Company is as set forth in the Prospectuses in the column entitled
"Actual" under the caption "Capitalization" (except for subsequent issuances, if
any, pursuant to this Agreement, pursuant to reservations, agreements or
employee benefit plans referred to in the Prospectuses or pursuant to the
exercise of convertible securities or options referred to in the Prospectuses).
The shares of issued and outstanding capital stock have been duly authorized and
validly issued and are fully paid and non-assessable; none of the outstanding
shares of capital stock was issued in violation of the preemptive or other
similar rights of any securityholder of the Company.
(ix) AUTHORIZATION OF AGREEMENT. This Agreement and the International
Purchase Agreement have has been duly authorized, executed and delivered by the
Company.
(x) AUTHORIZATION AND DESCRIPTION OF SECURITIES. The Securities have
been duly authorized for issuance and sale to the U.S. Underwriters pursuant to
this Agreement and to the International Managers pursuant to the International
Purchase Agreement and, when issued and delivered by the Company pursuant to
this Agreement and the International Purchase Agreement, respectively, against
payment of the consideration set forth herein, will be validly issued and fully
paid and non-assessable; the Common Stock conforms to all statements relating
thereto contained in the Prospectuses and such description conforms to the
rights set forth in the instruments defining the same; no holder of the
Securities will be subject to personal liability by reason of being such a
holder; and the issuance of the Securities is not subject to the preemptive or
other similar rights of any securityholder of the Company.
6
(xi) ABSENCE OF DEFAULTS AND CONFLICTS. Neither the Company nor any
of its subsidiaries is in violation of its charter or by-laws or, except as
disclosed in the Registration Statement, in default in the performance or
observance of any obligation, agreement, covenant or condition contained in
any contract, indenture, mortgage, deed of trust, loan or credit agreement,
note, lease or other agreement or instrument to which the Company or any of
its subsidiaries is a party or by which it or any of them may be bound, or to
which any of the property or assets of the Company or any subsidiary is
subject (collectively, "Agreements and Instruments") except for such defaults
that would not result in a Material Adverse Effect; and the execution,
delivery and performance of this Agreement and the International Purchase
Agreement and the consummation of the transactions contemplated herein and
therein and in the Registration Statement (including the issuance and sale of
the Securities and the use of the proceeds from the sale of the Securities as
described in the Prospectuses under the caption "Use of Proceeds") and
compliance by the Company with its obligations hereunder and thereunder have
been duly authorized by all necessary corporate action and do not and will
not, whether with or without the giving of notice or passage of time or both,
conflict with or constitute a breach of, or default or Repayment Event (as
defined below) under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company or any
subsidiary pursuant to, the Agreements and Instruments (except for such
conflicts, breaches or defaults or liens, charges or encumbrances that would
not result in a Material Adverse Effect), nor will such action result in any
violation of the provisions of the charter or by-laws of the Company or any
subsidiary or any applicable law, statute, rule, regulation, judgment, order,
writ or decree of any government, government instrumentality or court,
domestic or foreign, having jurisdiction over the Company or any subsidiary
or any of their assets, properties or operations. As used herein, a
"Repayment Event" means any event or condition which gives the holder of any
note, debenture or other evidence of indebtedness (or any person acting on
such holder's behalf) the right to require the repurchase, redemption or
repayment of all or a portion of such indebtedness by the Company or any
subsidiary.
(xii) ABSENCE OF LABOR DISPUTE. No labor dispute with the employees of
the Company or any subsidiary exists or, to the knowledge of the Company, is
imminent, and the Company is not aware of any existing or imminent labor
disturbance by the employees of any of its or any subsidiary's principal
suppliers, manufacturers, customers or contractors, which, in either case, may
reasonably be expected to result in a Material Adverse Effect.
(xiii) ABSENCE OF PROCEEDINGS. There is no action, suit, proceeding,
inquiry or investigation before or brought by any court or governmental agency
or body, domestic or foreign, now pending, or, to the knowledge of the Company,
threatened, against or affecting the Company or any subsidiary, which is
required to be disclosed in the Registration Statement (other than as disclosed
therein), or which might reasonably be expected to result in a Material Adverse
Effect, or which might reasonably be expected to materially or adversely affect
the properties or assets thereof or the consummation of the transactions
contemplated in this Agreement or the performance by the Company of its
obligations hereunder; the aggregate of all pending legal or governmental
proceedings to which the Company or any subsidiary is a party or of which any of
their respective property or assets is the subject which are not described in
the
7
Registration Statement, including ordinary routine litigation incidental to the
business, could not reasonably be expected to result in a Material Adverse
Effect.
(xiv) ACCURACY OF EXHIBITS. There are no contracts or documents which
are required in the Registration Statement, the Prospectuses or the documents
incorporated by reference therein or to be filed as exhibits thereto which have
not been so described and filed as required.
(xv) POSSESSION OF INTELLECTUAL PROPERTY. The Company and its
subsidiaries own or possess, or can acquire on reasonable terms, adequate
patents, patent rights, licenses, inventions, copyrights, know-how (including
trade secrets and other unpatented and/or unpatentable proprietary or
confidential information, systems or procedures), trademarks, service marks,
trade names or other intellectual property (collectively, "Intellectual
Property") necessary to carry on the business now operated by them, and neither
the Company nor any of its subsidiaries has received any notice or is otherwise
aware of any infringement of or conflict with asserted rights of others with
respect to any Intellectual Property or of any facts or circumstances which
would render any Intellectual Property invalid or inadequate to protect the
interest of the Company or any of its subsidiaries therein, and which
infringement or conflict (if the subject of any unfavorable decision, ruling or
finding) or invalidity or inadequacy, singly or in the aggregate, would result
in a Material Adverse Effect.
(xvi) ABSENCE OF FURTHER REQUIREMENTS. The Minnesota Public Utilities
Commission has issued its order approving capital structure which order
authorizes the issuance of the Securities, and no other filing with, or
authorization, approval, consent, license, order, registration, qualification or
decree of, any court or governmental authority or agency is necessary or
required for the performance by the Company of its obligations under this
Agreement and the International Purchase Agreement, in connection with the
offering, issuance or sale of the Securities hereunder and thereunder or the
consummation of the transactions contemplated by this Agreement and the
International Purchase Agreement, except such as have been already obtained or
as may be required under the 1933 Act or the 1933 Act Regulations or foreign or
state securities laws.
(xvii) POSSESSION OF LICENSES AND PERMITS. The Company and its
subsidiaries possess such permits, licenses, approvals, consents and other
authorizations (collectively, "Governmental Licenses") issued by the appropriate
federal, state, local or foreign regulatory agencies or bodies necessary to
conduct the business now operated by them; the Company and its subsidiaries are
in compliance with the terms and conditions of all such Governmental Licenses,
except where the failure so to comply would not, singly or in the aggregate,
have a Material Adverse Effect; all of the Governmental Licenses are valid and
in full force and effect, except when the invalidity of such Governmental
Licenses or the failure of such Governmental Licenses to be in full force and
effect would not have a Material Adverse Effect; and neither the Company nor any
of its subsidiaries has received any notice of proceedings relating to the
revocation or modification of any such Governmental Licenses which, singly or in
the aggregate, if the subject of an unfavorable decision, ruling or finding,
would result in a Material Adverse Effect.
8
(xviii) TITLE TO PROPERTY. The Company has good and valid title to all
real and fixed property and leasehold rights owned by it, subject only to taxes
and assessments not yet delinquent; the lien of the Company's Trust Indenture,
dated as of February 1, 1937, as supplemented and amended (the "Indenture"); as
to parts of the Company's property, certain easements, conditions, restrictions,
leases, and similar encumbrances which do not affect the Company's use of such
property in the usual course of its business. and certain minor defects in
titles which are not material, and defects in titles to certain properties which
are not essential to the Company's business; and mechanics' lien claims being
contested or not of record or for the satisfaction or discharge of which
adequate provision has been made by the Company pursuant to the Indenture; and
any real property and buildings held under lease by the Company is held by it
under valid, subsisting and enforceable leases with such exceptions as are not
material and do not interfere with the use made and proposed to be made of such
property and buildings by the Company.
(xix) COMPLIANCE WITH CUBA ACT. The Company has complied with, and is
and will be in compliance with, the provisions of that certain Florida act
relating to disclosure of doing business with Cuba, codified as Section 517.075
of the Florida statutes, and the rules and regulations thereunder (collectively,
the "Cuba Act") or is exempt therefrom.
(xx) INVESTMENT COMPANY ACT. The Company is not, and upon the
issuance and sale of the Securities as herein contemplated and the application
of the net proceeds therefrom as described in the Prospectus will not be, an
"investment company" or an entity "controlled" by an "investment company" as
such terms are defined in the Investment Company Act of 1940, as amended (the
"1940 Act").
(xxi) ENVIRONMENTAL LAWS. Except as described in the Registration
Statement and except as would not, singly or in the aggregate, result in a
Material Adverse Effect, (A) neither the Company nor any of its subsidiaries is
in violation of any federal, state, local or foreign statute, law, rule,
regulation, ordinance, code, policy or rule of common law or any judicial or
administrative interpretation thereof, including any judicial or administrative
order, consent, decree or judgment, relating to pollution or protection of human
health, the environment (including, without limitation, ambient air, surface
water, groundwater, land surface or subsurface strata) or wildlife, including,
without limitation, laws and regulations relating to the release or threatened
release of chemicals, pollutants, contaminants, wastes, toxic substances,
hazardous substances, petroleum or petroleum products (collectively, "Hazardous
Materials") or to the manufacture, processing, distribution, use, treatment,
storage, disposal, transport or handling of Hazardous Materials (collectively,
"Environmental Laws"), (B) the Company and its subsidiaries have all permits,
authorizations and approvals required under any applicable Environmental Laws
and are each in compliance with their requirements, (C) there are no pending or
threatened administrative, regulatory or judicial actions, suits, demands,
demand letters, claims, liens, notices of noncompliance or violation,
investigation or proceeding relating to any Environmental Law against the
Company or any of its subsidiaries and (D) there are no events or circumstances
that might reasonably be expected to form the basis of an order for clean-up or
remediation, or an action, suit or proceeding by any private party or
governmental
9
body or agency, against or affecting the Company or any of its subsidiaries
relating to Hazardous Materials or any Environmental Laws.
(b) OFFICER'S CERTIFICATES. Any certificate signed by any officer of the
Company or any of its subsidiaries and delivered to the U.S. Representatives or
to counsel for the U.S. Underwriters shall be deemed a representation and
warranty by the Company to each U.S. Underwriter as to the matters covered
thereby.
SECTION 2. SALE AND DELIVERY TO U.S. UNDERWRITERS; CLOSING.
a. U.S. INITIAL SECURITIES. On the basis of the representations and
warranties herein contained and subject to the terms and conditions herein set
forth, the Company agrees to sell to each U.S. Underwriter and each U.S.
Underwriter, severally and not jointly, agrees to purchase from the Company, at
the price per share set forth in Schedule B, the number of U.S. Initial
Securities set forth in Schedule A opposite the name of such U.S. Underwriter,
plus any additional number of U.S. Initial Securities which such U.S.
Underwriter may become obligated to purchase pursuant to the provisions of
Section 10 hereof, subject to such adjustments among the U.S. Underwriters as
the Representatives in their sole discretion shall make to eliminate any sales
or purchases of fractional securities.
b. U.S. OPTION SECURITIES. In addition, on the basis of the
representations and warranties herein contained and subject to the terms and
conditions herein set forth, the Company hereby grants an option to the U.S.
Underwriters, severally and not jointly, to purchase up to an additional 480,000
shares of Common Stock, at the price per share set forth in Schedule B, less an
amount per share equal to any dividends or distributions declared by the Company
and payable on the U.S. Initial Securities but not payable on the U.S. Option
Securities. The option hereby granted will expire 30 days after the date hereof
and may be exercised in whole or in part from time to time only for the purpose
of covering over-allotments which may be made in connection with the offering
and distribution of the U.S. Initial Securities upon notice by the U.S.
Representatives to the Company setting forth the number of U.S. Option
Securities as to which the several U.S. Underwriters are then exercising the
option and the time and date of payment and delivery for such U.S. Option
Securities. Any such time and date of delivery (a "Date of Delivery") shall be
determined by the U.S. Representatives, but shall not be later than seven full
business days after the exercise of said option, nor in any event prior to the
Closing Time, as hereinafter defined. If the option is exercised as to all or
any portion of the U.S. Option Securities, each of the U.S. Underwriters, acting
severally and not jointly, will purchase that proportion of the total number of
U.S. Option Securities then being purchased which the number of U.S. Initial
Securities set forth in Schedule A opposite the name of such U.S. Underwriter
bears to the total number of U.S. Initial Securities, subject in each case to
such adjustments as the U.S. Representatives in their discretion shall make to
eliminate any sales or purchases of fractional shares.
c. PAYMENT. Payment of the purchase price for, and delivery of
certificates for, the U.S. Initial Securities shall be made at the offices of
Xxxxxxx, Carton & Xxxxxxx, 000 X. Xxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx 00000, or at
such other place as shall be agreed upon by the U.S.
10
Representatives and the Company at 9:00 A.M. (Central time) on the third
(fourth, if the pricing occurs after 4:30 P.M. (Eastern time) on any given day)
business day after the date hereof (unless postponed in accordance with the
provisions of Section 10), or such other time not later than ten business days
after such date as shall be agreed upon by the U.S. Representatives and the
Company (such time and date of payment and delivery being herein called "Closing
Time."
In addition, in the event that any or all of the U.S. Option Securities are
purchased by the U.S. Underwriters, payment of the purchase price for, and
delivery of certificates for, such U.S. Option Securities shall be made at the
above-mentioned offices, or at such other place as shall be agreed upon by the
U.S. Representatives and the Company, on each Date of Delivery as specified in
the notice from the U.S. Representatives to the Company.
Payment shall be made to the Company by wire transfer of immediately
available funds to a bank account designated by the Company against delivery to
the U.S. Representatives for the respective accounts of the U.S. Underwriters of
certificates for the U.S. Securities to be purchased by them. It is understood
that each U.S. Underwriter has authorized the U.S. Representatives, for its
account, to accept delivery of, receipt for, and make payment of the purchase
price for, the U.S. Initial Securities and the U.S. Option Securities, if any,
which it has agreed to purchase. Xxxxxxx Xxxxx, individually and not as
representative of the U.S. Underwriters, may (but shall not be obligated to)
make payment of the purchase price for the U.S. Initial Securities or the U.S.
Option Securities, if any, to be purchased by any U.S. Underwriter whose funds
have not been received by the Closing Time or the relevant Date of Delivery, as
the case may be, but such payment shall not relieve such U.S. Underwriter from
its obligations hereunder.
d. DENOMINATIONS; REGISTRATION. Certificates for the U.S. Initial
Securities and the U.S. Option Securities, if any, shall be in such
denominations and registered in such names as the U.S. Representatives may
request in writing at least one full business day before the Closing Time or the
relevant Date of Delivery, as the case may be. The certificates for the U.S.
Initial Securities and the U.S. Option Securities, if any, will be made
available for examination and packaging by the U.S. Representatives in The City
of New York not later than 10:00 A.M. (Eastern time) on the business day prior
to the Closing Time or the relevant Date of Delivery, as the case may be.
SECTION 3. COVENANTS OF THE COMPANY. The Company covenants with each U.S.
Underwriter as follows:
a. COMPLIANCE WITH SECURITIES REGULATIONS AND COMMISSION REQUESTS. The
Company, subject to Section 3(b), will comply with the requirements of Rule 430A
or Rule 434, as applicable, and will notify the U.S. Representatives
immediately, and confirm the notice in writing, (i) when any post-effective
amendment to the Registration Statement shall become effective, or any
supplement to the Prospectuses or any amended Prospectuses shall have been
filed, (ii) of the receipt of any comments from the Commission, (iii) of any
request by the Commission for any amendment to the Registration Statement or any
amendment or supplement to the Prospectuses or for additional information, and
(iv) of the issuance by the Commission of
11
any stop order suspending the effectiveness of the Registration Statement or of
any order preventing or suspending the use of any preliminary prospectus, or of
the suspension of the qualification of the Securities for offering or sale in
any jurisdiction, or of the initiation or threatening of any proceedings for any
of such purposes. The Company will promptly effect the filings necessary
pursuant to Rule 424(b) and will take such steps as it deems necessary to
ascertain promptly whether the form of prospectus transmitted for filing under
Rule 424(b) was received for filing by the Commission and, in the event that it
was not, it will promptly file such prospectus. The Company will make every
reasonable effort to prevent the issuance of any stop order and, if any stop
order is issued, to obtain the lifting thereof at the earliest possible moment.
b. FILING OF AMENDMENTS. The Company will give the Representatives
notice of its intention to file or prepare any amendment to the Registration
Statement (including any filing under Rule 462(b)), any Term Sheet or any
amendment, supplement or revision to either the prospectuses included in the
Registration Statement at the time it became effective or to the Prospectuses,
whether pursuant to the 1933 Act, the 1934 Act or otherwise, will furnish the
Representatives with copies of any such documents a reasonable amount of time
prior to such proposed filing or use, as the case may be, and will not file or
use any such document to which the U.S. Representatives or counsel for the
Underwriters shall object.
c. DELIVERY OF REGISTRATION STATEMENTS. The Company has furnished or
will deliver to the U.S. Representatives and counsel for the U.S. Underwriters,
without charge, signed copies of the Registration Statement as originally filed
and of each amendment thereto (including exhibits filed therewith or
incorporated by reference therein and documents incorporated or deemed to be
incorporated by reference therein) and signed copies of all consents and
certificates of experts, and will also deliver to the U.S. Representatives,
without charge, a conformed copy of the Registration Statement as originally
filed and of each amendment thereto (without exhibits) for each of the U.S.
Underwriters. The copies of the Registration Statement and each amendment
thereto furnished to the U.S. Underwriters will be identical to the
electronically transmitted copies thereof filed with the Commission pursuant to
XXXXX, except to the extent permitted by Regulation S-T.
d. DELIVERY OF PROSPECTUSES. The Company has delivered to each U.S.
Underwriter, without charge, as many copies of each preliminary prospectus as
such U.S. Underwriter reasonably requested, and the Company hereby consents to
the use of such copies for purposes permitted by the 1933 Act. The Company will
furnish to each U.S. Underwriter, without charge, during the period when the
Prospectuses are is required to be delivered under the 1933 Act or the 1934 Act,
such number of copies of the Prospectuses (as amended or supplemented) as such
U.S. Underwriter may reasonably request. The Prospectuses and any amendments or
supplements thereto furnished to the U.S. Underwriters will be identical to the
electronically transmitted copies thereof filed with the Commission pursuant to
XXXXX, except to the extent permitted by Regulation S-T.
e. CONTINUED COMPLIANCE WITH SECURITIES LAWS. The Company will comply
with the 1933 Act and the 1933 Act Regulations and the 1934 Act and the 1934 Act
Regulations so as to permit the completion of the distribution of the Securities
as contemplated in this Agreement and
12
the International Purchase Agreement and in the Prospectuses. If at any time
when a prospectus is required by the 1933 Act to be delivered in connection with
sales of the Securities, any event shall occur or condition shall exist as a
result of which it is necessary, in the opinion of counsel for the U.S.
Underwriters or for the Company, to amend the Registration Statement or amend or
supplement the Prospectuses in order that the Prospectuses will not include any
untrue statements of a material fact or omit to state a material fact necessary
in order to make the statements therein not misleading in the light of the
circumstances existing at the time it is delivered to a purchaser, or if it
shall be necessary, in the opinion of such counsel, at any such time to amend
the Registration Statement or amend or supplement the Prospectuses in order to
comply with the requirements of the 1933 Act or the 1933 Act Regulations, the
Company will promptly prepare and file with the Commission, subject to
Section 3(b), such amendment or supplement as may be necessary to correct such
statement or omission or to make the Registration Statement or the Prospectuses
comply with such requirements, and the Company will furnish to the U.S.
Underwriters such number of copies of such amendment or supplement as the U.S.
Underwriters may reasonably request.
f. BLUE SKY QUALIFICATIONS. The Company will use its best efforts, in
cooperation with the U.S. Underwriters, to qualify the Securities for offering
and sale under the applicable securities laws of such states and other
jurisdictions (domestic or foreign) as the U.S. Representatives may designate
and to maintain such qualifications in effect for a period of not less than one
year from the later of the effective date of the Registration Statement and any
Rule 462(b) Registration Statement; provided, however, that the Company shall
not be obligated to file any general consent to service of process or to qualify
as a foreign corporation or as a dealer in securities in any jurisdiction in
which it is not so qualified or to subject itself to taxation in respect of
doing business in any jurisdiction in which it is not otherwise so subject. In
each jurisdiction in which the Securities have been so qualified, the Company
will file such statements and reports as may be required by the laws of such
jurisdiction to continue such qualification in effect for a period of not less
than one year from the effective date of the Registration Statement and any
Rule 462(b) Registration Statement.
g. RULE 158. The Company will timely file such reports pursuant to the
1934 Act as are necessary in order to make generally available to its
securityholders as soon as practicable an earnings statement for the purposes
of, and to provide the benefits contemplated by, the last paragraph of
Section 11(a) of the 1933 Act.
h. USE OF PROCEEDS. The Company will use the net proceeds received by it
from the sale of the Securities in the manner specified in the Prospectus under
"Use of Proceeds".
i. LISTING. The Company will use its best efforts to effect the listing
of the Securities on the New York Stock Exchange, Chicago Stock Exchange and
Pacific Exchange.
j. RESTRICTION ON SALE OF SECURITIES. During a period of 120 days from
the date of the Prospectuses, the Company will not, without the prior written
consent of Xxxxxxx Xxxxx, (i) directly or indirectly, offer, pledge, sell,
contract to sell, sell any option or contract to purchase, purchase any option
or contract to sell, grant any option, right or warrant to purchase or
13
otherwise transfer or dispose of any share of Common Stock or any securities
convertible into or exercisable or exchangeable for Common Stock or file any
registration statement under the 1933 Act with respect to any of the foregoing
or (ii) enter into any swap or any other agreement or any transaction that
transfers, in whole or in part, directly or indirectly, the economic consequence
of ownership of the Common Stock, whether any such swap or transaction described
in clause (i) or (ii) above is to be settled by delivery of Common Stock or such
other securities, in cash or otherwise. The foregoing sentence shall not apply
to (A) the Securities to be sold hereunder or under the International Purchase
Agreement, (B) any shares of Common Stock issued by the Company upon the
exercise of an option or warrant or the conversion of a security outstanding on
the date hereof and referred to in the Prospectuses, (C) any shares of Common
Stock issued or options to purchase Common Stock granted pursuant to existing
employee benefit plans of the Company referred to in the Prospectuses or (D) any
shares of Common Stock issued pursuant to any non-employee director stock plan
or dividend reinvestment plan.
(k) REPORTING REQUIREMENTS. The Company, during the period when the
Prospectuses are required to be delivered under the 1933 Act or the 1934 Act,
will file all documents required to be filed with the Commission pursuant to the
1934 Act within the time periods required by the 1934 Act and the 1934 Act
Regulations.
SECTION 4. PAYMENT OF EXPENSES. (a) EXPENSES. The Company will pay or cause to
be paid all expenses incident to the performance of its obligations under this
Agreement, including (i) the preparation, printing and filing of the
Registration Statement (including financial statements and exhibits) as
originally filed and of each amendment thereto, (ii) the preparation, printing
and delivery to the Underwriters of this Agreement, any Agreement among
Underwriters, any Intersyndicate Agreement and such other documents as may be
required in connection with the offering, purchase, sale, issuance or delivery
of the Securities, (iii) the preparation, issuance and delivery of the
certificates for the Securities to the Underwriters, including any stock or
other transfer taxes and any stamp or other duties payable upon the sale,
issuance or delivery of the Securities to the Underwriters and the transfer of
the Securities between the U.S. Underwriters and the International Managers,
(iv) the fees and disbursements of the Company's counsel, accountants and other
advisors, (v) the qualification of the Securities under securities laws in
accordance with the provisions of Section 3(f) hereof, including filing fees and
the reasonable fees and disbursements of counsel for the U.S. Underwriters in
connection therewith and in connection with the preparation of the Blue Sky
Survey and any supplement thereto, (vi) the printing and delivery to the
Underwriters of copies of each preliminary prospectus, any Term Sheets and of
the Prospectuses and any amendments or supplements thereto, (vii) the
preparation, printing and delivery to the Underwriters of copies of the Blue Sky
Survey and any supplement thereto, (viii) the fees and expenses of any transfer
agent or registrar for the Securities and (ix) the fees and expenses incurred in
connection with the listing of the Securities on the New York Stock Exchange,
Chicago Stock Exchange and Pacific Exchange.
(b) TERMINATION OF AGREEMENT. If this Agreement is terminated by the
U.S. Representatives in accordance with the provisions of Section 5,
Section 9(a)(i) or Section 11 hereof, the Company shall reimburse the U.S.
Underwriters for all of their out-of-pocket expenses, including the reasonable
fees and disbursements of counsel for the U.S. Underwriters.
14
SECTION 5. CONDITIONS OF U.S. UNDERWRITERS' OBLIGATIONS. The obligations of the
several U.S. Underwriters hereunder are subject to the accuracy of the
representations and warranties of the Company contained in Section 1 hereof or
in certificates of any officer of the Company or any subsidiary of the Company
delivered pursuant to the provisions hereof, to the performance by the Company
of its covenants and other obligations hereunder, and to the following further
conditions:
(a) EFFECTIVENESS OF REGISTRATION STATEMENT. The Registration Statement,
including any Rule 462(b) Registration Statement, has become effective and at
Closing Time no stop order suspending the effectiveness of the Registration
Statement shall have been issued under the 1933 Act or proceedings therefor
initiated or threatened by the Commission, and any request on the part of the
Commission for additional information shall have been complied with to the
reasonable satisfaction of counsel to the Underwriters. A prospectus containing
the Rule 430A Information shall have been filed with the Commission in
accordance with Rule 424(b) (or a post-effective amendment providing such
information shall have been filed and declared effective in accordance with the
requirements of Rule 430A) or, if the Company has elected to rely upon Rule 434,
a Term Sheet shall have been filed with the Commission in accordance with Rule
424(b).
(b) OPINION OF COUNSEL FOR COMPANY. At Closing Time, the U.S.
Representatives shall have received the favorable opinion, dated as of Closing
Time, of Xxxx X. Xxxxxxx, Vice President and General Counsel of the Company, in
form and substance satisfactory to counsel for the U.S. Underwriters, together
with signed or reproduced copies of such letter for each of the other U.S.
Underwriters to the effect set forth in Exhibit A hereto and to such further
effect as counsel to the U.S. Underwriters may reasonably request.
(c) OPINION OF COUNSEL FOR U.S. UNDERWRITERS. At Closing Time, the U.S.
Representatives shall have received the favorable opinion, dated as of Closing
Time, of Xxxxxxx, Xxxxxx & Xxxxxxx, counsel for the U.S. Underwriters, together
with signed or reproduced copies of such letter for each of the other U.S.
Underwriters with respect to the matters set forth in clauses (i), (ii), (v),
(vi) (solely as to preemptive or other similar rights arising by operation of
law or under the charter or by-laws of the Company), (viii) through (x),
inclusive, (xiii), (xv) (solely as to the information in the Prospectuses under
"Description of Common Stock") and the penultimate paragraph of Exhibit A
hereto. In giving such opinion such counsel may rely, as to all matters
governed by the laws of the jurisdictions other than the federal law of the
United States, upon the opinions of counsel satisfactory to the U.S.
Representatives. Such counsel may also state that, insofar as such opinion
involves factual matters, they have relied, to the extent they deem proper, upon
certificates of officers of the Company and its subsidiaries and certificates of
public officials.
(d) OFFICERS' CERTIFICATE. At Closing Time, there shall have not been,
since the date hereof or since the respective dates as of which information is
given in the Prospectuses, any material adverse change in the condition,
financial or otherwise, or in the earnings, business affairs or business
prospects of the Company and its subsidiaries considered as one enterprise,
15
whether or not arising in the ordinary course of business, and the U.S.
Representatives shall have received a certificate of the President or a Vice
President of the Company and of the chief financial or chief accounting officer
of the Company, dated as of Closing Time, to the effect that (i) there has been
no such material adverse change, (ii) the representations and warranties in
Section 1(a) hereof are true and correct with the same force and effect as
though expressly made at and as of Closing Time, (iii) the Company has complied
with all agreements and satisfied all conditions on its part to be performed or
satisfied at or prior to Closing Time, and (iv) no stop order suspending the
effectiveness of the Registration Statement has been issued and no proceedings
for that purpose have been instituted or are pending or are contemplated by the
Commission.
(e) ACCOUNTANT'S COMFORT LETTER. At the time of the execution of this
Agreement, the U.S. Representatives shall have received from Price Waterhouse
LLP a letter dated such date, in form and substance satisfactory to the U.S.
Representatives, together with signed or reproduced copies of such letter for
each of the other U.S. Underwriters containing statements and information of the
type ordinarily included in accountants' "comfort letters" to underwriters with
respect to the financial statements and certain financial information contained
in the Registration Statement and the Prospectuses.
(f) BRING-DOWN COMFORT LETTER. At Closing Time, the U.S. Representatives
shall have received from Price Waterhouse LLP a letter, dated as of Closing
Time, to the effect that they reaffirm the statements made in the letter
furnished pursuant to subsection (e) of this Section, except that the specified
date referred to shall be a date not more than three business days prior to
Closing Time.
(g) APPROVAL OF LISTING. At Closing Time, the Securities shall have been
approved for listing on the New York Stock Exchange, subject only to official
notice of issuance.
(h) Contemporaneously with the purchase by the U.S. Underwriters of the
U.S. Initial Securities under this Agreement, the International Managers shall
have purchased the International Initial Securities under the International
Purchase Agreement.
(i) CONDITIONS TO PURCHASE OF U.S. OPTION SECURITIES. In the event that
the U.S. Underwriters exercise their option provided in Section 2(b) hereof to
purchase all or any portion of the U.S. Option Securities, the representations
and warranties of the Company contained herein and the statements in any
certificates furnished by the Company and any subsidiary of the Company
hereunder shall be true and correct as of each Date of Delivery and, at the
relevant Date of Delivery, the U.S. Representatives shall have received:
(i) OFFICERS' CERTIFICATE. A certificate, dated such Date of Delivery, of
the President or a Vice President of the Company and of the chief
financial or chief accounting officer of the Company confirming that
the certificate delivered at the Closing Time pursuant to Section 5(d)
hereof remains true and correct as of such Date of Delivery.
16
(ii) OPINION OF COUNSEL FOR COMPANY. The favorable opinion of Xxxx X.
Xxxxxxx, Vice President and General Counsel of the Company in
form and substance satisfactory to counsel for the U.S.
Underwriters, dated such Date of Delivery, relating to the U.S.
Option Securities to be purchased on such Date of Delivery and
otherwise to the same effect as the opinion required by Section
5(b) hereof.
(iii) OPINION OF COUNSEL FOR U.S. UNDERWRITERS. The favorable opinion
of Xxxxxxx, Xxxxxx & Xxxxxxx, counsel for the U.S. Underwriters,
dated such Date of Delivery, relating to the U.S. Option
Securities to be purchased on such Date of Delivery and otherwise
to the same effect as the opinion required by Section 5(c)
hereof.
(iv) BRING-DOWN COMFORT LETTER. A letter from Price Waterhouse LLP,
in form and substance satisfactory to the U.S. Representatives
and dated such Date of Delivery, substantially in the same form
and substance as the letter furnished to the U.S. Representatives
pursuant to Section 5(e) hereof, except that the "specified date"
in the letter furnished pursuant to this paragraph shall be a
date not more than five days prior to such Date of Delivery.
(j) ADDITIONAL DOCUMENTS. At Closing Time and at each Date of
Delivery counsel for the U.S. Underwriters shall have been furnished with such
documents and opinions as they may require for the purpose of enabling them to
pass upon the issuance and sale of the Securities as herein contemplated, or in
order to evidence the accuracy of any of the representations or warranties, or
the fulfillment of any of the conditions, herein contained; and all proceedings
taken by the Company in connection with the issuance and sale of the Securities
as herein contemplated shall be satisfactory in form and substance to the U.S.
Representatives and counsel for the U.S. Underwriters.
(k) TERMINATION OF AGREEMENT. If any condition specified in this
Section shall not have been fulfilled when and as required to be fulfilled, this
Agreement, or, in the case of any condition to the purchase of U.S. Option
Securities on a Date of Delivery which is after the Closing Time, the
obligations of the several U.S. Underwriters to purchase the relevant U.S.
Option Securities, may be terminated by the U.S. Representatives by notice to
the Company at any time at or prior to Closing Time or such Date of Delivery, as
the case may be, and such termination shall be without liability of any party to
any other party except as provided in Section 4 and except that Sections 1, 6, 7
and 8 shall survive any such termination and remain in full force and effect.
SECTION 6 INDEMNIFICATION.
(a) INDEMNIFICATION OF UNDERWRITERS. The Company agrees to indemnify
and hold harmless each U.S. Underwriter and each person, if any, who controls
any U.S. Underwriter within the meaning of Section 15 of the 1933 Act or Section
20 of the 1934 Act as follows:
17
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement or
alleged untrue statement of a material fact contained in the Registration
Statement (or any amendment thereto), including the Rule 430A Information
and Rule 434 Information, if applicable, or the omission or alleged
omission therefrom of a material fact required to be stated therein or
necessary to make the statements therein not misleading or arising out of
any untrue statement or alleged untrue statement of a material fact
included in any preliminary prospectus or the Prospectuses (or any
amendment or supplement thereto), or the omission or alleged omission
therefrom of a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount paid
in settlement of any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission; provided that (subject to Section
6(d) below) any such settlement is effected with the written consent of the
Company; and
(iii) against any and all expense whatsoever, as incurred
(including the fees and disbursements of counsel chosen by Xxxxxxx Xxxxx),
reasonably incurred in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental agency
or body, commenced or threatened, or any claim whatsoever based upon any
such untrue statement or omission, or any such alleged untrue statement or
omission, to the extent that any such expense is not paid under (i) or (ii)
above;
PROVIDED, HOWEVER, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by any
U.S. Underwriter through Xxxxxxx Xxxxx expressly for use in the Registration
Statement (or any amendment thereto), including the Rule 430A Information and
the Rule 434 Information, if applicable, or any preliminary prospectus or the
U.S. Prospectus (or any amendment or supplement thereto).
(b) INDEMNIFICATION OF COMPANY, DIRECTORS AND OFFICERS. Each U.S.
Underwriter severally agrees to indemnify and hold harmless the Company, its
directors, each of its officers who signed the Registration Statement, and each
person, if any, who controls the Company within the meaning of Section 15 of the
1933 Act or Section 20 of the 1934 Act, against any and all loss, liability,
claim, damage and expense described in the indemnity contained in subsection (a)
of this Section, as incurred, but only with respect to untrue statements or
omissions, or alleged untrue statements or omissions, made in the Registration
Statement (or any amendment thereto), including the Rule 430A Information and
the Rule 434 Information, if applicable, or any preliminary prospectus or the
U.S. Prospectus (or any amendment or supplement thereto) in reliance upon and in
conformity with written information furnished to the Company by such U.S.
Underwriter through Xxxxxxx Xxxxx expressly for use in the Registration
Statement (or any
18
amendment thereto) or such preliminary prospectus or the U.S. Prospectus (or any
amendment or supplement thereto).
(c) ACTIONS AGAINST PARTIES; NOTIFICATION. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying party of
any action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve such
indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from any liability which it may have otherwise than on account of this indemnity
agreement. In the case of parties indemnified pursuant to Section 6(a) above,
counsel to the indemnified parties shall be selected by Xxxxxxx Xxxxx, and, in
the case of parties indemnified pursuant to Section 6(b) above, counsel to the
indemnified parties shall be selected by the Company. An indemnifying party may
participate at its own expense in the defense of any such action; provided,
however, that counsel to the indemnifying party shall not (except with the
consent of the indemnified party) also be counsel to the indemnifying party. In
no event shall the indemnifying parties be liable for fees and expenses of more
than one counsel (in addition to any local counsel) separate from their own
counsel for all indemnified parties in connection with any one action or
separate but similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances. No indemnifying party shall,
without the prior written consent of the indemnified parties, settle or
compromise or consent to the entry of any judgment with respect to any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever in respect of which
indemnification or contribution could be sought under this Section 6 or Section
7 hereof (whether or not the indemnified parties are actual or potential parties
thereto), unless such settlement, compromise or consent (i) includes an
unconditional release of each indemnified party from all liability arising out
of such litigation, investigation, proceeding or claim and (ii) does not include
a statement as to or an admission of fault, culpability or a failure to act by
or on behalf of any indemnified party.
(d) SETTLEMENT WITHOUT CONSENT IF FAILURE TO REIMBURSE. If at any time
an indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, such indemnifying party
agrees that it shall be liable for any settlement of the nature contemplated by
Section 6(a)(ii) effected without its written consent if (i) such settlement is
entered into more than 45 days after receipt by such indemnifying party of the
aforesaid request, (ii) such indemnifying party shall have received notice of
the terms of such settlement at least 30 days prior to such settlement being
entered into and (iii) such indemnifying party shall not have reimbursed such
indemnified party in accordance with such request prior to the date of such
settlement.
SECTION 7. CONTRIBUTION. If the indemnification provided for in Section 6
hereof is for any reason unavailable to or insufficient to hold harmless an
indemnified party in respect of any losses, liabilities, claims, damages or
expenses referred to therein, then each indemnifying party shall contribute to
the aggregate amount of such losses, liabilities, claims, damages or expenses
incurred by such indemnified party, as incurred, (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company on the one
hand and the U.S. Underwriters on the
19
other hand from the offering of the U.S. Securities pursuant to this Agreement
or (ii) if the allocation provided by clause (i) is not permitted by applicable
law, in such proportion as is appropriate to reflect not only the relative
benefits referred to in clause (i) above but also the relative fault of the
Company on the one hand and the U.S. Underwriters on the other hand in
connection with the statements of omissions which resulted in such losses,
liabilities, claims, damages or expenses, as well as any other relevant
equitable considerations.
The relative benefits received by the Company on the one hand and the U.S.
Underwriters on the other hand in connection with the offering of the U.S.
Securities pursuant to this Agreement shall be deemed to be in the same
respective proportions as the total net proceeds from the offering of the U.S.
Securities pursuant to this Agreement (before deducting expenses) received by
the Company and the total underwriting discount received by the U.S.
Underwriters, in each case as set forth on the cover of the U.S. Prospectus, or,
if Rule 434 is used, the corresponding location on the Term Sheet bear to the
aggregate initial public offering price of the U.S. Securities as set forth on
such cover.
The relative fault of the Company on the one hand and the U.S. Underwriters
on the other hand shall be determined by reference to, among other things,
whether any such untrue or alleged untrue statement of a material fact or
omission or alleged omission to state a material fact relates to information
supplied by the Company or by the U.S. Underwriters and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission.
The Company and the U.S. Underwriters agree that it would not be just and
equitable if the contribution pursuant to this Section 7 were determined by pro
rata allocation (even if the U.S. Underwriters were treated as one entity for
such purpose) or by any other method of allocation which does not take account
of the equitable considerations referred to above in this Section 7. The
aggregate amount of losses, liabilities, claims, damages or expenses incurred
by an indemnified party and referred to above in this Section 7 shall be deemed
to include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, no U.S. Underwriter shall
be required to contribute any amount in excess of the amount by which the total
price at which the U.S. Securities underwritten by it and distributed to the
public were offered to the public exceeds the amount of any damages which such
U.S. Underwriter has otherwise been required to pay by reason of any such untrue
or alleged untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the 1933 Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
20
For purposes of this Section 7, each person, if any, who controls an a U.S.
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act shall have the same rights to contribution as such U.S.
Underwriter, and each director of the Company, each officer of the Company who
signed the Registration Statement, and each person, if any, who controls the
Company within the meaning of Section 15 of the 1933 Act or Section 20 of the
1934 Act shall have the same rights to contribution as the Company. The U.S.
Underwriter's respective obligations to contribute pursuant to this Section 7
are several in proportion to the number of U.S. Initial Securities set forth
opposite their respective names in Schedule A hereto and not joint.
SECTION 8. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE DELIVERY. All
representations, warranties and agreements contained in this Agreement or in
certificates of officers of the Company or any of its subsidiaries submitted
pursuant hereto, shall remain operative and in full force and effect, regardless
of any investigation made by or on behalf of any U.S. Underwriter or controlling
person, or by or on behalf of the Company, and shall survive delivery of the
Securities to the U.S. Underwriters.
SECTION 9. Termination of Agreement
(a) TERMINATION; GENERAL. The U.S. Representatives may terminate this
Agreement, by notice to the Company, at any time at or prior to Closing Time (i)
if there has been, since the time of execution of this Agreement or since the
respective dates as of which information is given in the Prospectuses, any
material adverse change, or any development which could reasonably be expected
to result in a prospective material adverse change, in the condition, financial
or otherwise, or in the earnings, business affairs or business prospects of the
Company and its subsidiaries considered as one enterprise, whether or not
arising in the ordinary course of business, or (ii) if there has occurred any
material adverse change in the financial markets in the United States, any
outbreak of hostilities or escalation thereof or other calamity or crisis or any
change or development involving a prospective change in national or
international political, financial or economic conditions, in each case the
effect of which is such as to make it, in the judgment of the U.S.
Representatives, impracticable to market the Securities or to enforce contracts
for the sale of the Securities, or (iii) if trading in any securities of the
Company has been suspended or materially limited by the Commission or the New
York Stock Exchange, or if trading generally on the American Stock Exchange or
the New York Stock Exchange or in the Nasdaq National Market has been suspended
or materially limited, or minimum or maximum prices for trading have been fixed,
or maximum ranges for prices have been required, by any of said exchanges or by
such system or by order of Commission, the National Association of Securities
Dealers, Inc. or any other governmental authority, of (iv) if a banking
moratorium has been declared by either Federal, Minnesota or New York
authorities.
(b) LIABILITIES. If this Agreement is terminated pursuant to this
Section, such termination shall be without liability of any party to any other
party except as provided in Section 4 hereof, and provided further that Sections
1, 6, 7 and 8 shall survive such termination and remain in full force and
effect.
21
SECTION 10. DEFAULT BY ONE OR MORE OF THE U.S. UNDERWRITERS. If one or more
of the U.S. Underwriters shall fail at Closing Time or a Date of Delivery to
purchase the Securities which it or they are obligated to purchase under this
Agreement (the "Defaulted Securities"), the U.S. Representatives shall have the
right, within 24 hours thereafter, to make arrangement for one or more of the
non-defaulting U.S. Underwriters, or any other underwriters, to purchase all,
but not less than all, of the Defaulted Securities in such amounts as may be
agreed upon and upon the terms herein set forth; if, however, the U.S.
Representatives shall not have completed such arrangements within such 24-hour
period; then:
(a) if the number of Defaulted Securities does not exceed 10% of the
number of U.S. Securities to be purchased on such date, each of the
non-defaulting U.S. Underwriters shall be obligated, severally and not
jointly, to purchase the full amount thereof in the proportions that their
respective underwriting obligations hereunder bear to the underwriting
obligations of all non-defaulting U.S. Underwriters, or
(b) if the number of Defaulted Securities exceeds 10% of the number
of U.S. Securities to be purchased on such date, this Agreement or, with
respect to any Date of Delivery which occurs after the Closing Time, the
obligation of the U.S. Underwriters to purchase and of the Company to sell
the U.S. Option Securities to be purchased and sold on such Date of
Delivery shall terminate without liability on the party of any
non-defaulting U.S. Underwriter.
No action taken pursuant to this Section shall relieve any defaulting U.S.
Underwriter from liability in respect of its default.
In the event of any such default which does not result in a termination of
this Agreement or, in the case of a Date of Delivery which is after the Closing
Time, which does not result in a termination of the obligation of the U.S.
Underwriters to purchase and the Company to sell the relevant U.S. Option
Securities, as the case may be, either the U.S. Representatives or the Company
shall have the right to postpone Closing Time or the relevant Date of Delivery,
as the case may be, for a period not exceeding seven days in order to effect any
required changes in the Registration Statement or Prospectuses or in any other
documents or arrangements. As used herein, the term "U.S. Underwriter" includes
any person substituted for an U.S. Underwriter under this Section 10.
SECTION 11. NOTICES. All notices and other communications hereunder shall be
in writing and shall be deemed to have been duly given if mailed or transmitted
by any standard form of telecommunication. Notices to the U.S. Underwriters
shall be directed to the U.S. Representatives at North Tower, World Financial
Center, New York, New York 10281-1201, attention of Xxxxxxx X. Xxxxxxx, Managing
Director; with a copy to Xxxxxxx, Carton & Xxxxxxx, 000 X. Xxxxx Xxxxxx,
Xxxxxxx, Xxxxxxxx 00000, attention of Xxxxxx X. Xxxxxx, Esq.; and notices to the
Company shall be directed to it at Northern States Power Company, 000 Xxxxxxxx
Xxxx, Xxxxxxxxxxx, Xxxxxxxxx 00000, attention of Corporate Secretary.
22
SECTION 12. PARTIES. This Agreement shall inure to the benefit of and be
binding upon the U.S. Underwriters and the Company and their respective
successors. Nothing expressed or mentioned in this Agreement is intended or
shall be construed to give any person, firm or corporation, other than the U.S.
Underwriters and the Company and their respective successors and the controlling
persons and officers and directors referred to in Sections 6 and 7 and their
heirs and legal representatives, any legal or equitable right, remedy or claim
under or in respect of this Agreement or any provision herein contained. This
Agreement and all conditions and provisions hereof are intended to be for the
sole and exclusive benefit of the U.S. Underwriters and the Company and their
respective successors, and said controlling persons and officers and directors
and their heirs and legal representatives, and for the benefit of no other
person, firm or corporation. No purchaser of Securities from any U.S.
Underwriter shall be deemed to be a successor by reason merely of such purchase.
SECTION 13. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF MINNESOTA APPLICABLE TO
AGREEMENTS MADE AND TO BE PERFORMED IN SAID STATE. EXCEPT AS OTHERWISE SET
FORTH HEREIN, SPECIFIED TIMES OF DAY REFER TO MINNEAPOLIS TIME.
SECTION 14. EFFECT OF HEADINGS. The Article and Section headings herein and
the Table of Contents are for convenience only and shall not affect the
construction hereof.
23
If the foregoing is in accordance with your understanding of our agreement,
please sign and return to the Company a counterpart hereof, whereupon this
instrument, along with all counterparts, will become a binding agreement among
the U.S. Underwriters and the Company in accordance with its terms.
Very truly yours,
NORTHERN STATES POWER COMPANY
(a Minnesota corporation)
By:
-----------------------------------
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written:
XXXXXXX XXXXX & CO.
XXXXXXX XXXXX, XXXXXX, XXXXXX & XXXXX
INCORPORATED
XXXXXXX, XXXXX & CO.
XXXXXXX XXXXXXXX INC
XXXX XXXXXXXX INCORPORATED
XXXXX XXXXXXX INC.
By: XXXXXXX XXXXX, XXXXXX, XXXXXX & XXXXX
INCORPORATED
By:
--------------------------------
Authorized Signatory
For themselves and as U.S. Representatives of the other U.S. Underwriters named
in Schedule A hereto.
24
SCHEDULE A
Number of
U.S. Initial
Name of U.S. Underwriters Securities
------------------------- ----------
Xxxxxxx Xxxxx, Xxxxxx, Xxxxxx & Xxxxx
Incorporated................................
Xxxxxxx, Xxxxx & Co.............................
Salomon Brothers Inc............................
Xxxx Xxxxxxxx Incorporated......................
Xxxxx Xxxxxxx Inc...............................
----------
Total ........................................ 3,200,0000
----------
----------
25
SCHEDULE B
NORTHERN STATES POWER COMPANY
(a Minnesota corporation)
3,200,0000 Shares of Common Stock
(Par Value $2.50 Per Share)
1. The initial public offering price per share for the Securities,
determined as provided in said Section 2, shall be $__________.
2. The purchase price per share for the U.S. Securities to be paid by the
several U.S. Underwriters shall be $__________, being an amount equal to the
initial public offering price set forth above less $__________ per share;
provided that the purchase price per share for any U.S. Option Securities
purchased upon the exercise of the over-allotment option described in Section
2(b) shall be reduced by an amount per share equal to any dividends or
distributions declared by the Company and payable on the U.S. Initial Securities
but not payable on the U.S. Option Securities.
26
EXHIBIT A
FORM OF OPINION OF XXXX X. XXXXXXX
Re: 3,200,0000 Shares of Common Stock, par value $2.50
per share, of Northern States Power Company,
a Minnesota corporation
Gentlemen:
For the purpose of rendering this opinion, I have examined the proceedings
taken by Northern States Power Company, a Minnesota corporation, herein called
the "Company," with respect to the issue and sale by the Company of 3,200,0000
shares of Common Stock, par value $2.50 per share, herein called the
"Securities." In connection therewith I have participated in the preparation of
the proceedings for the issuance and sale of the Securities including (i) the
U.S. Purchase Agreement dated ________________, between you and the Company
relating to your purchase of the U.S. Securities, herein called the "Agreement."
and (ii) the International Purchase Agreement dated ______ between _______ and
the Company relating to the issue and sale of the International Securities,
herein called the "International Purchase Agreement." I also have participated
in the preparation of or examined the registration statement and any amendments
thereto and the accompanying prospectuses and any supplements thereto, as filed
under the Securities Act of 1933, as amended (the "Act"), with respect to the
Securities. Capitalized terms not otherwise defined herein shall have the
respective meanings set forth in the Agreement. My examination has extended to
all statutes, records, instruments, and documents which I have deemed necessary
to examine for the purposes of this opinion.
I am of the opinion that:
1. The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Minnesota.
2. The Company has corporate power and authority to own, lease and
operate its properties and to conduct its business as described in the
Prospectuses and to enter into and perform its obligations under the Agreement
and the International Purchase Agreement.
3. The Company is duly qualified as a foreign corporation to transact
business and is in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or leasing of
property or the conduct of business, except where the failure so to qualify or
to be in good standing would not result in a Material Adverse Effect.
4. The authorized, issued and outstanding capital stock of the Company is
as set forth in the Prospectuses in the column entitled "Actual" under the
caption "Capitalization" (except for subsequent issuances, if any, pursuant to
the Agreement and the International Purchase Agreement or pursuant to
reservations, agreements or employee benefit plans referred to in the
Prospectuses or pursuant to the exercise of convertible securities or options
referred to
A-1
in the Prospectuses); the shares of issued and outstanding capital stock of the
Company have been duly authorized and validly issued and are fully paid and
non-assessable; and none of the outstanding shares of capital stock of the
Company was issued in violation of the preemptive or other similar rights of any
securityholder of the Company.
5. The Securities to be purchased by the U.S. Underwriters and the
International Managers from the Company have been duly authorized for issuance
and sale to the U.S. Underwriters and the International Managers pursuant to the
Agreement and the International Purchase Agreement, respectively, and, when
issued and delivered by the Company pursuant to the Agreement and the
International Purchase Agreement, respectively, against payment of the
consideration set forth in the Agreement and the International Purchase
Agreement, respectively, will be validly issued and fully paid and
non-assessable and no holder of the Securities is or will be subject to personal
liability by reason of being such a holder.
6. The issuance and sale of the Securities by the Company is not subject
to the preemptive or other similar rights of any securityholder of the Company.
7. Each Significant Subsidiary has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the jurisdiction of
its incorporation, has corporate power and authority to own, lease and operate
its properties and to conduct its business as described in the Prospectuses and
is duly qualified as a foreign corporation to transact business and is in good
standing in each jurisdiction in which such qualification is required, whether
by reason of the ownership or leasing of property or the conduct of business,
except where the failure so to qualify or to be in good standing would not
result in a Material Adverse Effect; except as otherwise disclosed in the
Registration Statement, all of the issued and outstanding capital stock of each
Significant Subsidiary has been duly authorized and validly issued, is fully
paid and non-assessable and, to the best of my knowledge, is owned by the
Company, directly or through subsidiaries, free and clear of any security
interest, mortgage, pledge, lien, encumbrance, claim or equity; none of the
outstanding shares of capital stock of any Significant Subsidiary was issued in
violation of the preemptive or similar rights of any securityholder of such
Subsidiary.
8. The Agreement and the International Purchase Agreement have has been
duly authorized, executed and delivered by the Company.
9. The Registration Statement, including any Rule 462(b) Registration
Statement has been declared effective under the 1933 Act; any required filing of
the Prospectuses pursuant to Rule 424(b) has been made in the manner and within
the time period required by Rule 424(b); and, to the best of my knowledge, no
stop order suspending the effectiveness of the Registration Statement or any
Rule 462(b) Registration Statement has been issued under the 1933 Act and no
proceedings for that purpose have been instituted or are pending or threatened
by the Commission.
10. The Registration Statement, including any Rule 462(b) Registration
Statement, the Rule 430A Information and the Rule 434 Information, as
applicable, the Prospectuses,
A-2
excluding the documents incorporated by reference therein, and each amendment or
supplement to the Registration Statement and Prospectuses, excluding the
documents incorporated by reference therein, as of their respective effective or
issue dates (other than the financial statements and supporting schedules
included therein or omitted therefrom, as to which I need express no opinion)
complied as to form in all material respects with the requirements of the 1933
Act and the 1933 Act Regulations.
11. The documents incorporated by reference in the Prospectus (other than
the financial statements and supporting schedules included therein or omitted
therefrom, as to which I need express no opinion), when they were filed with the
Commission complied as to form in all material respects with the requirements of
the 1934 Act and the rules and regulations of the Commission thereunder.
12. If Rule 434 has been relied upon, the Prospectus was not "materially
different," as such term is used in Rule 434, from the prospectus included in
the Registration Statement at the time it became effective.
13. The form of certificate used to evidence the Common Stock complies in
all material respects with all applicable statutory requirements, with any
applicable requirements of the charter and by-laws of the Company and the
requirements of the New York Stock Exchange.
14. To the best of my knowledge, there is not pending or threatened any
action, suit, proceeding, inquiry or investigation, to which the Company or any
subsidiary is a party, or to which the property of the Company or any subsidiary
is subject, before or brought by any court or governmental agency or body,
domestic or foreign, which might reasonably be expected to result in a Material
Adverse Effect, or which might reasonably by expected to materially and
adversely affect the properties or assets thereof or the consummation of the
transactions contemplated in the Agreement and the International Purchase
Agreement or the performance by the Company of its obligations thereunder.
15. The information in the Prospectus under "Description of Common Stock",
and in the Registration Statement under Item 15, to the extent that it
constitutes matters of law, summaries of legal matters, the Company's charter
and bylaws or legal proceedings, or legal conclusions, has been reviewed by me
and is correct in all material respects.
16. To the best of my knowledge, there are no statutes or regulations that
are required to be described in the Prospectus that are not described as
required.
17. All Descriptions in the Registration Statement of contracts and other
documents to which the Company or its subsidiaries are a party are accurate in
all material respects; to the best of my knowledge, there are no franchises,
contracts, indentures, mortgage, loan agreements, notes, leases or other
instruments required to be described or referred to in the Registration
Statement or to be filed as exhibits thereto other than those described or
referred to therein or filed or incorporated by reference as exhibits thereto,
and the descriptions thereof or references thereto are correct in all material
respects.
A-3
18. To the best of my knowledge, neither the Company nor any subsidiary is
in violation of its charter or by-laws and no default by the Company or any
subsidiary exists in the due performance or observance of any material
obligation, agreement, covenant or condition contained in any contract,
indenture, mortgage, loan agreement, note, lease or other agreement or
instrument that is described or referred to in the Registration Statement or the
Prospectuses or filed or incorporated by reference as an exhibit to the
Registration Statement.
19. The Minnesota Public Utilities Commission has issued its order
approving the Company's capital structure which order authorizes the issuance of
the Securities, and no other filing with, or authorization, approval, consent,
license, order, registration, qualification or decree of, any court or
governmental authority or agency, domestic or foreign (other than under the 1933
Act and the 1933 Act Regulations, which have been obtained, or as may be
required under the securities or blue sky laws of the various states, as to
which I need express no opinion) is necessary or required in connection with the
due authorization, execution and delivery of the Agreement and the International
Purchase Agreement or for the offering, issuance, sale or delivery of the
Securities.
20. The execution, delivery and performance of the Agreement and the
International Purchase Agreement and the consummation of the transactions
contemplated in the Agreement and the International Purchase Agreement and in
the Registration Statement (including the issuance and sale of the Securities
and the use of the proceeds from the sale of the Securities as described in the
Prospectuses under the caption "Use of Proceeds") and compliance by the Company
with its obligations under the Agreement and the International Purchase
Agreement do not and will not, whether with or without the giving of notice or
lapse of time or both, conflict with or constitute a breach of, or default or
Repayment Event (as defined in Section 1(a)(xi) of the Purchase Agreement) under
or result in the creation or imposition of any lien, charge or encumbrance upon
any property or assets of the Company or any subsidiary pursuant to any
contract, indenture, mortgage, deed of trust, loan or credit agreement, note,
lease or any other agreement or instrument, known to me, to which the Company or
any subsidiary is a party or by which it or any of them may be bound, or to
which any of the property or assets of the Company or any subsidiary is subject
(except for such conflicts, breaches or defaults or liens, charges or
encumbrances that would not have a Material Adverse Effect), nor will such
action result in any violation of the provisions of the charter or by-laws of
the Company or any subsidiary, or any applicable law, statute, rule, regulation,
judgment, order, writ or decree, known to me, of any government, government
instrumentality or court, domestic or foreign, having jurisdiction over the
Company or any subsidiary or any of their respective properties, assets or
operations.
21. The Company is not an "investment company" or an entity "controlled"
by an "investment company," as such terms are defined in the 1940 Act.
22. The Company has good and valid title to all real and fixed property
and leasehold rights owned by it, subject only to: (a) taxes and assessments not
yet delinquent; (b) the lien of the Indenture (as defined in the Agreement); (c)
as to parts of the Company's property, certain easements, conditions,
restrictions, leases, and similar encumbrances which do not affect the
A-4
Company's use of such property in the usual course of its business, certain
minor defects in titles which are not material, defects in titles to certain
properties which are not essential to the Company's business; and mechanics'
lien claims being contested or not of record or for the satisfaction or
discharge of which adequate provision has been made by the Company pursuant to
the Indenture.
23. The Company has all necessary power under statutory provisions,
franchises (which expire at various dates), or permits to serve the customers in
the jurisdictions where it provides electric and gas service, except in certain
instances that are not material to the Company.
These opinions do not cover title to easements for water flowage purposes
or rights of way for electric and gas transmission and distribution facilities,
steam mains, and telephone lines. However, the Company has the power of eminent
domain in the states in which it operates.
In the course of my participation in the preparation of the Registration
Statement and Prospectuses I made investigations as to the accuracy of certain
of the statements of fact contained therein, I discussed other matters with
officers, employees, and representatives of the Company, and I examined various
corporate records and data. While I do not pass upon or assume responsibility
for, and shall not be deemed to have independently verified, the accuracy and
completeness of the statements contained in the Registration Statement or
Prospectuses (except as to matters set forth in paragraphs 4,15 and 17 above)
nothing has come to my attention that would lead me to believe that the
Registration Statement (including the Rule 430A Information) at the time it
became effective contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading or that the Prospectuses as of the date of the
Agreement or at the date hereof contained an untrue statement of a material fact
or omitted to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made. not
misleading.
In giving my opinion under paragraph 22 above. I have relied upon
examinations of abstracts of titles to properties of the Company, said abstracts
bearing various dates, and nothing has come to my attention which would lead me
to believe that anything has occurred since the dates of the abstracts which
would adversely affect the titles shown on the abstracts. In giving opinions as
to conformity to the laws of States other than Minnesota and as to the franchise
and titles to property of the Company, I have in certain instances relied upon
the opinion of other counsel employed or retained by the Company to render
opinions in respect thereto.
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Respectfully submitted,
By:
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Xxxx X. Xxxxxxx
VICE PRESIDENT AND GENERAL COUNSEL
NORTHERN STATES POWER COMPANY
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