Exhibit 1-2
_________ __% CAPITAL SECURITIES
ENERGY EAST CAPITAL TRUST [ ]
GUARANTEED BY
ENERGY EAST CORPORATION
UNDERWRITING AGREEMENT
[Insert Date]
[Name of Representatives]
for themselves and as Representatives for the Underwriters
named in Schedule A, attached hereto
[Name and Address of Representatives]
Ladies and Gentlemen:
1. Energy East Capital Trust [ ] (the "Trust"), a
statutory business trust created under the Business Trust Act (the "Delaware
Act") of the State of Delaware (Chapter 38, Title 12, of the Delaware Code, 12
Del. C. Sections 3801 et seq.), and Energy East Corporation, a New York
corporation ("Energy East" and, together with the Trust, the "Offerors"),
confirm their agreement (the "Agreement") with [Name of Representatives]
(together, the "Representatives"), and each of the other Underwriters named in
Schedule A hereto (collectively, including the Representatives, the
"Underwriters"), with respect to the issue and sale by the Trust and the
purchase by the Underwriters, acting severally and not jointly, of the
respective number set forth opposite their names in Schedule A of the ________
__% Capital Securities (liquidation amount of $______ per security) of the Trust
(the "Capital Securities") under the terms specified in Schedule B hereto. The
Capital Securities will be fully and unconditionally guaranteed by Energy East
(the "Capital Securities Guarantee"), to the extent described in the Prospectus
(as defined below), with respect to distributions and payments upon liquidation,
redemption and otherwise pursuant to the Capital Securities Guarantee Agreement
(the "Capital Securities Guarantee Agreement"), to be dated as of
_______________, between Energy East and The Chase Manhattan Bank, as Trustee
(the "Guarantee Trustee"). The Capital Securities issued in book-entry form will
be issued to Cede & Co., as nominee of The Depository Trust Company ("DTC"),
pursuant to a letter of representations, to be dated on or prior to the Time of
Delivery (as defined in Section 4 herein), among the Trust, the Guarantee
Trustee and DTC.
The entire proceeds from the sale of the Capital Securities
will be combined with the entire proceeds from the sale by the Trust to Energy
East of its common securities (the
"Common Securities"), and will be used by the Trust to purchase $_______________
of ___% Junior Subordinated Debt Securities, due _______________ (the "Debt
Securities") issued by Energy East. The Capital Securities and the Common
Securities will be issued pursuant to the Amended and Restated Trust Agreement
of Energy East Capital Trust [ ], to be dated as of _______________ (the "Trust
Agreement"), among Energy East, as sponsor, _______________ and _______________,
as administrative trustees (the "Administrative Trustees"), The Chase Manhattan
Bank, as property trustee (the "Property Trustee"), and Chase Manhattan Bank
USA, National Association, as Delaware trustee (the "Delaware Trustee" and,
together with the Property Trustee and the Administrative Trustees, the
"Trustees"). The Debt Securities will be issued pursuant to an indenture dated
as of _____________, as to be supplemented by a ___________ Supplemental
Indenture dated as of _______________ (collectively, the "Indenture"), between
Energy East and The Chase Manhattan Bank, as trustee (the "Debt Securities
Trustee"). The Trust and Energy East shall enter into an Agreement as to
Expenses and Liabilities (the "Expenses Agreement") to be dated as of
_______________, pursuant to which Energy East shall pay, under certain
circumstances, the Obligations (as defined in the Expenses Agreement) of the
Trust.
The Capital Securities, the Capital Securities Guarantee and
the Debt Securities may be collectively referred to herein as the "Securities."
The Indenture, the Trust Agreement and the Capital Securities Guarantee
Agreement, the Expenses Agreement and this Agreement may be referred to herein
collectively as the "Operative Documents."
The Offerors understand that the Underwriters propose to make
a public offering of the Capital Securities (as guaranteed by the Capital
Securities Guarantee) on the terms and in the manner set forth herein and agree
that the Underwriters may resell, subject to the conditions set forth herein,
all or a portion of the Capital Securities.
Any discretion to be exercised with respect to this Agreement
will be exercised jointly by _____ and ____ as [joint book-running managers].
2. The Offerors jointly and severally represent and
warrant to, and agree with, each of the Underwriters that:
(a) A registration statement on Form S-3 (File Nos.
333-62056 and 000-00000-0_), as amended by Pre-Effective Amendment
No. 1 (the "Registration Statement," which term shall include all
exhibits thereto and the documents incorporated by reference in the
prospectus contained therein) in respect of the Securities and
certain other securities of Energy East has been filed with the
Securities and Exchange Commission (the "Commission"); the
Registration Statement, in the form heretofore delivered or to be
delivered to the Underwriters has been declared effective by the
Commission in such form; no other document with respect to the
Registration Statement or document incorporated by reference therein
has heretofore been filed or transmitted for filing with the
Commission; and no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceeding for that
purpose has been initiated or threatened by the Commission (the term
"Base Prospectus" means the base prospectus relating to the Capital
Securities and other securities included in the Registration
Statement; the term "Prospectus" means the Base Prospectus
supplemented by a prospectus supplement ("Prospectus Supplement")
relating
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specifically to the Capital Securities filed with the Commission
pursuant to Rule 424(b) under the Securities Act of 1933, as amended
(the "Act"); the term "Preliminary Prospectus" means a preliminary
prospectus supplement specifically relating to the Capital Securities
together with the Base Prospectus; any reference herein to any Base
Prospectus, Preliminary Prospectus or the Prospectus shall be deemed to
refer to and include the documents incorporated by reference therein
pursuant to the applicable form under the Act, as of the date of such
Base Prospectus, Preliminary Prospectus or Prospectus, as the case may
be; any reference to any amendment or supplement shall be deemed to
refer to and include any documents filed after the date of such Base
Prospectus under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), and incorporated by reference in such Base Prospectus;
any reference to the Registration Statement shall be deemed to refer to
and include any document filed pursuant to Section 13(a) or 15(d) of
the Exchange Act after the effective date of the Registration Statement
that is incorporated by reference in the Registration Statement;
(b) Except for the order of the Commission with respect
to the effectiveness of the Registration Statement referred to in
paragraph (a) above, no consent, approval, authorization, order,
registration or qualification of or with any federal or state
commission, court or governmental agency or body is required for the
issue and sale of the Capital Securities or the issue of the Common
Securities, Capital Securities Guarantee or the Debt Securities or the
consummation by Energy East or the Trust of the transactions
contemplated by the Operating Documents, except such approvals as have
been, or will have been, prior to the Time of Delivery, obtained under
the Act, the Public Utility Holding Company Act of 1935 (the "Holding
Company Act") and such consents, approvals, authorizations, orders,
registrations or qualifications as may be required under state
securities or Blue Sky laws in connection with the purchase and
distribution of the Capital Securities by the Underwriters; and a copy
of the order heretofore entered by the Commission with respect to the
effectiveness of the Registration Statement has been or will be
delivered to Underwriters;
(c) The documents incorporated by reference in the
Prospectus, when they were filed with the Commission, conformed in all
material respects to the requirements of the Act or the Exchange Act,
as applicable, and the rules and regulations of the Commission
thereunder, and none of such documents 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; and any further documents so filed and incorporated by
reference in the Prospectus or any further amendment or supplement
thereto, when such documents are filed with the Commission, will
conform in all material respects to the requirements of the Act or the
Exchange Act, as applicable, and the rules and regulations of the
Commission thereunder 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;
PROVIDED, HOWEVER, that this representation and warranty shall not
apply to any statements or omissions made in reliance upon and in
conformity with information furnished in writing to Energy East by any
Underwriter of the Capital Securities expressly for use in the
Prospectus as amended or supplemented;
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(d) The Registration Statement and the Prospectus
conform, and any further amendments or supplements to the Registration
Statement or the Prospectus will conform, in all material respects to
the requirements of the Act and the Trust Indenture Act of 1939 (the
"Trust Indenture Act"), and the rules and regulations of the Commission
thereunder and do not and will not, as of the applicable effective date
as to the Registration Statement and any amendment thereto and as of
the applicable filing date and the Time of Delivery as to the
Prospectus and any amendment or supplement thereto, 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; PROVIDED, HOWEVER, that this representation and warranty
shall not apply to any statements or omissions made in reliance upon
and in conformity with information furnished in writing to Energy East
by any Underwriter of the Capital Securities expressly for use in the
Prospectus as amended or supplemented;
(e) The consolidated financial statements filed with or
as part of the Registration Statement present fairly the financial
position, results of operations and changes in financial position of
Energy East and its subsidiaries at the dates and for the periods
indicated, all in conformity with generally accepted accounting
principles; and neither Energy East nor the Trust has any material
contingent obligation which is not disclosed in the Registration
Statement and the Prospectus;
(f) Neither Energy East nor any of its subsidiaries has
sustained, since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus, any loss or
interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, which would
result in any material adverse change, or any development involving a
prospective material adverse change in or affecting the general
affairs, management, financial position, stockholders' equity or
results of operations of Energy East and its subsidiaries, taken as a
whole, otherwise than as set forth or contemplated in the Prospectus;
and, since the respective dates as of which information is given in the
Registration Statement and the Prospectus, there has not been any
change in the capital stock (other than pursuant to Energy East's
common stock repurchase program, or its dividend reinvestment and other
common stock plans) or long-term debt of Energy East or any of its
Significant Subsidiaries, as that term is defined in Rule 1-02 of
Regulation S-X of the Rules and Regulations, or any material adverse
change, or any development involving a prospective material adverse
change, in or affecting the general affairs, management, financial
position, stockholders' equity or results of operations of Energy East
and its subsidiaries, taken as a whole, otherwise than as set forth or
contemplated in the Prospectus; and there has not been any material
adverse change, or any development involving a prospective material
adverse change, in or affecting the general affairs, management,
financial position or results of operations of the Trust;
(g) Energy East has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, with power and authority (corporate
and other) to own its properties and conduct its business as described
in the Prospectus and is duly qualified to transact business and is in
good
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standing in each jurisdiction in which the conduct of its business or
its ownership or leasing of property requires such qualification,
except to the extent that the failure to be so qualified or be in good
standing would not have a material adverse effect on Energy East and
its subsidiaries, taken as a whole;
(h) The Trust has been duly created and is validly
existing and in good standing as a business trust under the Delaware
Act, with power and authority to own property and conduct its business
as described in the Prospectus and to enter into and perform its
obligations under this Agreement and the Trust Agreement; the Trust is
and will be classified for United States Federal income tax purposes as
a grantor trust and not as an association taxable as a corporation. The
Trust does not have any consolidated or unconsolidated Significant
Subsidiaries as such term is defined in Rule 1-02 of Regulation S-X of
the Rules and Regulations, and will be treated as a consolidated
subsidiary of Energy East pursuant to generally accepted accounting
principles. The Trust is not required to be authorized to do business
in any jurisdiction other than the State of Delaware. The Trust is duly
qualified 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;
(i) Each Significant Subsidiary of Energy East has been
duly incorporated, is validly existing as a corporation in good
standing under the laws of the jurisdiction of its incorporation, has
the power and authority (corporate and other) to own its property and
to conduct its business as described in the Prospectus and is duly
qualified to transact business and is in good standing in each
jurisdiction in which the conduct of its business or its ownership or
leasing of property requires such qualification, except to the extent
that the failure to be so qualified or be in good standing would not
have a material adverse effect on Energy East and its subsidiaries,
taken as a whole; except as described in the Registration Statement and
the Prospectus, each Significant Subsidiary of Energy East holds all
material licenses, certificates and permits from governmental
authorities necessary for the conduct of its business;
(j) Energy East has an authorized capitalization as set
forth in the Prospectus as amended or supplemented, and all of the
issued shares of capital stock of Energy East have been duly and
validly authorized and issued and are fully paid and non-assessable;
(k) The Common Securities have been duly authorized by
the Trust Agreement and, when duly executed, issued and delivered by
the Trust to Energy East against payment therefor as set forth in the
Trust Agreement, will be validly issued and, subject to the terms of
the Trust Agreement, fully paid and non-assessable undivided beneficial
interests in the assets of the Trust. The issuance of the Common
Securities is not subject to preemptive or other similar rights. On the
Time of Delivery, all of the issued and outstanding Common Securities
of the Trust will be directly owned by Energy East free and clear of
any security interest, mortgage, pledge, lien, claim, encumbrance or
equitable right;
(l) The Capital Securities have been duly authorized by
the Trust Agreement and, when duly executed, issued and delivered, will
be validly issued and, subject to the
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terms of the Trust Agreement, fully paid and non-assessable
preferred undivided beneficial interests in the assets of the Trust.
Subject to the terms of the Trust Agreement, the holders of the
Capital Securities, as beneficial owners of Capital Securities of
the Trust, will be entitled to the same limitation of personal
liability extended to stockholders of private corporations for
profit organized under the General Corporation Law of the State of
Delaware except that the holders of the Capital Securities may be
obligated to provide (a) indemnity and security in connection with
and pay taxes or governmental charges arising from transfers of
Capital Securities certificates and the issuance of replacement
Capital Securities certificates, and (b) security and indemnity in
connection with requests of or directions to the Property Trustee to
exercise its rights and remedies under the Trust Agreement;
(m) The Capital Securities Guarantee Agreement, the Trust
Agreement, the Debt Securities, the Expenses Agreement and the
Indenture have each been duly authorized by Energy East and when
validly executed and delivered by Energy East and, in the case of the
Capital Securities Guarantee Agreement, by the Guarantee Trustee, in
the case of the Trust Agreement, by the Trustees thereto, in the case
of the Indenture, by the Debt Securities Trustee, and in the case of
the Debt Securities, when validly issued by Energy East and duly
authenticated and delivered by the Debt Securities Trustee, will
constitute valid and legally binding obligations of Energy East,
enforceable in accordance with their respective terms, subject, as to
enforcement, to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium or other laws or judicial decisions of
general applicability relating to or affecting creditors' rights and to
general equity principles (regardless of whether enforcement is
considered in a proceeding at law or in equity); the Debt Securities
when validly issued by Energy East and duly authenticated and delivered
by the Debt Securities Trustee, will be entitled to the benefits of the
Indenture; each of the Indenture, the Trust Agreement and the Capital
Securities Guarantee Agreement has been duly authorized and duly
qualified under the Trust Indenture Act; and each of the Securities and
the Operative Documents conform to the descriptions thereof in the
Prospectus;
(n) The execution, delivery and performance of the
Operative Documents, the Common Securities and the Capital Securities
by the Trust and the consummation of the transactions contemplated in
the Operative Documents, the Common Securities, the Capital Securities
and in the Registration Statement (including the issuance and sale of
the Common Securities and the Capital Securities by the Trust and the
use of the proceeds from the sale of the Common Securities and the
Capital Securities as described in the Prospectus under the caption
"Use of Proceeds") by the Trust and compliance by the Trust with its
obligations under the Operative Documents, the Common Securities and
Capital Securities will not conflict with or result in a breach or
violation of any of the terms or provisions of, or constitute a default
under, any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which the Trust is a party or by which the
Trust is bound, nor will such action result in any violation of the
provisions of the Trust Agreement or the certificate of trust of the
Trust, or any statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the Trust. The
Trust is not a party to or otherwise bound by any material agreement
other than those described in the Prospectus;
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(o) The execution, delivery and performance of the
Operative Documents and the Debt Securities by Energy East and the
consummation of the transactions contemplated in the Operative
Documents, the Debt Securities and the Registration Statement
(including the issuance and sale of the Debt Securities and the use of
the proceeds from the sale of the Debt Securities as described in the
Prospectus under the caption "Use of Proceeds") by Energy East and
compliance by Energy East with its obligations under the Operative
Documents and the Debt Securities will not conflict with or result in a
breach or violation of any of the terms or provisions of, or constitute
a default under, any indenture, mortgage, deed of trust, loan agreement
or other agreement or instrument to which Energy East is a party or by
which Energy East is bound, nor will such action result in any
violation of the provisions of the Certificate of Incorporation or
By-laws of Energy East or any statute or any order, rule or regulation
of any court or governmental agency or body having jurisdiction over
Energy East or any of its properties;
(p) The statements set forth in the Prospectus as
supplemented under the captions "Description of Trust Preferred
Securities," "Description of Junior Subordinated Debt Securities,"
"Description of the Guarantees" and "Agreement as to Expenses and
Liabilities," insofar as they purport to constitute a summary of the
terms of the Capital Securities, Debt Securities, Capital Securities
Guarantee, and Expenses Agreement, respectively, and under the captions
"Material United States Federal Income Tax Considerations" and "Plan of
Distribution," insofar as they purport to describe the provisions of
the laws and documents referred to therein, are accurate, complete and
fair;
(q) Neither Energy East nor any of its Significant
Subsidiaries is in violation of its Certificate of Incorporation or
By-laws nor is the Trust in violation of the Trust Agreement or
certificate of trust of the Trust; none of Energy East, any of its
Significant Subsidiaries or the Trust is in default in the performance
or observance of any material obligation, agreement, covenant or
condition contained in any contracts, indenture, mortgage, deed of
trust, loan agreement, lease or other agreement or instrument to which
it is a party;
(r) Other than as set forth in the Prospectus, there are
no legal or governmental proceedings pending to which Energy East or
any of its subsidiaries is a party or of which any property of Energy
East or any of its subsidiaries is the subject which, if determined
adversely to Energy East or any of its subsidiaries, would individually
or in the aggregate have a material adverse effect on the current or
future consolidated financial position, stockholders' equity or results
of operations of Energy East and its subsidiaries, taken as a whole;
and, to the best of Energy East's knowledge, no such proceedings are
threatened or contemplated by governmental authorities or threatened by
others;
(s) Each of Energy East and the Trust is not and, after
giving effect to the offering and sale of the Capital Securities, will
not be an "investment company," as such term is defined in the
Investment Company Act of 1940, as amended (the "Investment Company
Act");
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(t) PricewaterhouseCoopers LLP, who have certified
certain consolidated financial statements of Energy East, are
independent public accountants as required by the Act and the rules and
regulations of the Commission thereunder; and
(u) Other than as set forth in the Prospectus, Energy
East and its Significant Subsidiaries are (i) in compliance with any
and all applicable foreign, federal, state and local laws and
regulations relating to the protection of human health and safety, the
environment or hazardous or toxic substances or wastes, pollutants or
contaminants ("Environmental Laws"), (ii) have received all permits,
licenses or other approvals required of them under applicable
Environmental Laws to conduct their respective businesses and (iii) are
in compliance with all terms and conditions of any such permit, license
or approval, except where such noncompliance with Environmental Laws,
failure to receive required permits, licenses or other approvals or
failure to comply with the terms and conditions of such permits,
licenses or approvals would not, singly or in the aggregate, have a
material adverse effect on Energy East and its subsidiaries, taken as a
whole.
3. On the basis of the representations, warranties and
covenants contained in this Agreement, and subject to the terms and conditions
herein set forth, the Trust agrees to sell to the several Underwriters and each
Underwriter agrees, severally and not jointly, to purchase from the Trust the
respective number of Capital Securities set forth in Schedule A hereto opposite
to its name, at a purchase price of $___ per Capital Security.
4. The Capital Securities to be delivered to the
Underwriters hereunder will be represented by one or more global certificates in
book-entry form which will be deposited by, or on behalf of, the Trust with, and
shall be registered in the name of, DTC or its designated custodian. The Trust
will deliver the Capital Securities to the Underwriters at the Time of Delivery
at the offices of Shearman & Sterling, New York, New York, against payment of
the purchase price in Federal (same day) funds to the account specified by the
Trust to the Underwriters. The Trust will cause the certificates representing
the Capital Securities to be made available to the Underwriters for checking at
least twenty-four hours prior to the Time of Delivery at the offices of Shearman
& Sterling. The time and date of such delivery shall be 9:30 a.m., New York City
time on ________ or such other date and time as Energy East and the Underwriters
may agree upon in writing. Such date and time are herein called the "Time of
Delivery."
5. Energy East and the Trust jointly and severally agree
with each of the Underwriters:
(a) To prepare the Prospectus as amended or
supplemented in a form approved by the Representatives and to file
such Prospectus pursuant to Rule 424(b) under the Act not later than
the Commission's close of business on the second business day
following the date hereof or, if applicable, such earlier time as
may be required by Rule 424(b); to make no further amendment or any
supplement to the Registration Statement or Prospectus as amended or
supplemented after the date hereof and prior to the Time of Delivery
which shall be disapproved by the Underwriters promptly after
reasonable notice thereof (other than the filing of any document
required to be filed under the Exchange Act which upon filing is
deemed to be incorporated by reference in the Registration Statement
or Prospectus); to advise the Representatives promptly of any such
amendment
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or supplement after such Time of Delivery and furnish the Underwriters
with copies thereof; to file promptly all reports and any definitive
proxy or information statements required to be filed by Energy East
with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of
the Exchange Act for so long as the delivery of a prospectus is
required in connection with the offering or sale of such Capital
Securities, and during such same period to advise the Underwriters,
promptly after it receives notice thereof, of the time when any
amendment to the Registration Statement has been filed or becomes
effective or any supplement to the Prospectus or any amended Prospectus
has been filed with the Commission, of the issuance by the Commission
of any stop order or of any order preventing or suspending the use of
any prospectus relating to the Capital Securities, of the suspension of
the qualification of such Capital Securities for offering or sale in
any jurisdiction, of the initiation or threatening of any proceeding
for any such purpose, or of any request by the Commission for the
amending or supplementing of the Registration Statement or Prospectus
or for additional information; and, in the event of the issuance of any
such stop order or of any such order preventing or suspending the use
of any prospectus relating to the Capital Securities or suspending any
such qualification, to promptly use its best efforts to obtain the
withdrawal of such order;
(b) Promptly from time to time to take such action as the
Representatives may reasonably request to qualify such Capital
Securities for offering and sale under the securities laws of such
jurisdictions as the Representatives may request and to comply with
such laws so as to permit the continuance of sales and dealings therein
in such jurisdictions for as long as may be necessary to complete the
distribution of such Capital Securities, PROVIDED that in connection
therewith Energy East shall not be required to qualify as a foreign
corporation or to file a general consent to service of process in any
jurisdiction;
(c) Prior to 10:00 a.m., New York City time, on the New
York business day next succeeding the date of this Agreement and from
time to time, to furnish the Representatives with copies of the
Prospectus, as amended or supplemented, in New York City in such
quantities as the Representatives may reasonably request, and, if the
delivery of a prospectus is required at any time in connection with the
offering or sale of the Capital Securities and if at such time any
event shall have occurred as a result of which the Prospectus as then
amended or supplemented would include an untrue statement of a material
fact or omit to state any material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made when such Prospectus is delivered, not misleading, or, if for
any other reason it shall be necessary during such same period to amend
or supplement the Prospectus or to file under the Exchange Act any
document incorporated by reference in the Prospectus in order to comply
with the Act, the Exchange Act or the Trust Indenture Act, to notify
the Underwriters and upon their request to file such document and to
prepare and furnish without charge to each Underwriter and to any
dealer in securities as many copies as the Underwriters may from time
to time reasonably request of an amended Prospectus or a supplement to
the Prospectus which will correct such statement or omission or effect
such compliance;
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(d) To make generally available to its securityholders as
soon as practicable, but in any event not later than 18 months after
the effective date of the Registration Statement (as defined in Rule
158(c) under the Act), an earnings statement of Energy East and its
subsidiaries (which need not be audited) complying with Section 11(a)
of the Act and the rules and regulations of the Commission thereunder
(including, at the option of Energy East, Rule 158); and
(e) During the period beginning from the date hereof and
continuing to and including the Time of Delivery, not to offer, sell,
contract to sell or otherwise dispose of any debt securities of Energy
East substantially similar to the Debt Securities or, in the case of an
offering of Capital Securities, any securities with characteristics
similar to those of the Capital Securities (other than the Capital
Securities) without the prior consent of the Representatives.
6. Energy East covenants and agrees with the several
Underwriters that Energy East will pay or cause to be paid the following: (i)
the fees, disbursements and expenses of Energy East's counsel and accountants in
connection with the registration of the Securities under the Act and all other
expenses in connection with the preparation, printing and filing of the
Registration Statement, any Preliminary Prospectus and the Prospectus and
amendments and supplements thereto and the mailing and delivering of copies
thereof to the Underwriters and dealers; (ii) the cost of printing or producing
the Operative Documents, any Blue Sky and Legal Investment Memoranda, closing
documents (including any compilations thereof) and any other documents in
connection with the offering, purchase, sale and delivery of the Capital
Securities; (iii) all expenses in connection with the qualification of the
Capital Securities, the Capital Securities Guarantee and the Debt Securities for
offering and sale under state securities laws as provided in Section 5(b)
hereof, including the fees and disbursements of counsel for the Underwriters in
connection with such qualification and in connection with the Blue Sky and Legal
Investment Surveys; (iv) any fees charged by securities rating services for
rating the Capital Securities; (v) any filing fees incident to, and the fees and
disbursements of counsel for the Underwriters in connection with, any required
review by the National Association of Securities Dealers, Inc. of the terms of
the sale of the Capital Securities and, if applicable, the Debt Securities; (vi)
the cost of preparing the Securities; (vii) the fees and expenses of any
Trustee, the Guarantee Trustee and Debt Securities Trustee and any agent of any
Trustee, the Guarantee Trustee and Debt Securities Trustee and the fees and
disbursements of counsel for any Trustee, the Guarantee Trustee and Debt
Securities Trustee in connection with any Operative Document and the Securities;
and (viii) all other costs and expenses incident to the performance of its
obligations hereunder which are not otherwise specifically provided for in this
Section 6. It is understood, however, that, except as provided in this Section
6, and Sections 8 and 12 hereof, the Underwriters will pay all of their own
costs and expenses, including the fees of their counsel, transfer taxes on
resale of any of the Capital Securities by them, and any advertising expenses
connected with any offers they may make.
7. The obligations of the Underwriters shall be subject,
in the discretion of the Underwriters, to the condition that all representations
and warranties and other statements of Energy East and the Trust in or
incorporated by reference in the Prospectus as amended or supplemented are, at
and as of the Time of Delivery, true and correct, the condition that Energy
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East and the Trust shall have performed all of its obligations hereunder
theretofore to be performed, and the following additional conditions:
(a) The Prospectus as amended or supplemented shall have
been filed with the Commission pursuant to Rule 424(b) within the
applicable time period prescribed for such filing by the rules and
regulations under the Act and in accordance with Section 5(a) hereof;
no stop order suspending the effectiveness of the Registration
Statement or any part thereof shall have been issued and no proceeding
for that purpose shall have been initiated or threatened by the
Commission; and all requests for additional information on the part of
the Commission shall have been complied with to the Representatives'
reasonable satisfaction;
(b) Shearman & Sterling, counsel for the Underwriters,
shall have furnished to the Underwriters their opinion, dated the Time
of Delivery, with respect to Energy East being duly incorporated and
validly existing under the laws of the jurisdiction of its
incorporation, the matters covered in paragraphs (v), (vi), (vii) and
(ix) of subsection (c) below, and the accuracy and completeness of the
statements set forth in the Prospectus under the captions "Description
of Junior Subordinated Debt Securities" and "Description of the
Guarantees," insofar as they purport to constitute a summary of the
terms of the Debt Securities and the Capital Securities Guarantee,
respectively, and "Plan of Distribution," insofar as they purport to
describe the documents referred to therein, as well as such other
matters as the Representatives on behalf of the Underwriters may
reasonably request, and such counsel shall have received such documents
and information as they may reasonably request to enable them to pass
upon such matters;
(c) Xxxxx Xxxxxxxx & Xxxxx, counsel for Energy East and
the Trust, shall have furnished to the Underwriters their opinion,
dated the Time of Delivery, in form and substance satisfactory to the
Representatives on behalf of the Underwriters, to the effect that:
(i) Energy East has been duly incorporated and
is validly existing as a corporation in good standing under
the laws of the jurisdiction of its incorporation, with power
and authority (corporate and other) to own its properties and
conduct its business as described in the Prospectus as amended
or supplemented and is duly qualified to transact business and
is in good standing in each jurisdiction in which the conduct
of its business or its ownership or leasing of its property
requires such qualification, except to the extent that the
failure to be so qualified or be in good standing would not
have a material adverse effect on Energy East and its
subsidiaries, taken as a whole;
(ii) Each Significant Subsidiary of Energy East
has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the state in
which it is incorporated, has the power and authority
(corporate and other) to own its property and conduct its
business as described in the Prospectus as amended or
supplemented and is duly qualified to transact business and is
in good standing in each jurisdiction in which the conduct of
its business or its ownership or leasing of property requires
such qualification, except
11
to the extent that the failure to be so qualified or be in
good standing would not have a material adverse effect on
Energy East and its subsidiaries, taken as a whole;
(iii) All of the issued shares of capital stock of
Energy East have been duly and validly authorized and issued
and are fully paid and non-assessable;
(iv) To the best of such counsel's knowledge and
other than as set forth in the Prospectus as amended or
supplemented, there are no legal or governmental proceedings
pending to which Energy East or any of its subsidiaries is a
party or of which any property of Energy East or any of its
subsidiaries is the subject which, if determined adversely to
Energy East or any of its subsidiaries, would individually or
in the aggregate have a material adverse effect on the current
or future consolidated financial position, stockholders'
equity or results of operations of Energy East and its
subsidiaries, taken as a whole; and, to the best of such
counsel's knowledge, no such proceedings are threatened or
contemplated by governmental authorities or threatened by
others;
(v) This Agreement has been duly authorized,
executed and delivered by Energy East;
(vi) The Debt Securities have been duly
authorized, executed, issued and delivered and, assuming due
authentication by the Debt Securities Trustee, constitute
valid and legally binding obligations of Energy East,
enforceable in accordance with its terms, subject, as to
enforcement, to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium or other laws or judicial decisions
of general applicability relating to or affecting creditors'
rights and to general equity principles (regardless of whether
enforcement is considered in a proceeding at law or in
equity); and the Debt Securities are entitled to the benefits
provided by the Indenture;
(vii) The Indenture has been duly authorized,
executed and delivered by Energy East and constitutes a valid
and legally binding obligation of Energy East, enforceable in
accordance with its terms, subject, as to enforcement, to
bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium or other laws or judicial decisions of general
applicability relating to or affecting creditors' rights and
to general equity principles (regardless of whether
enforcement is considered in a proceeding at law or in
equity); and the Indenture has been duly qualified under the
Trust Indenture Act;
(viii) The Trust Agreement has been duly
authorized, executed and delivered by Energy East and
constitutes a valid and legally binding obligation of Energy
East, enforceable in accordance with its terms, subject, as to
enforcement, to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium or other laws or judicial decisions
of general applicability relating to or affecting creditors'
rights and to general equity principles (regardless of whether
12
enforcement is considered in a proceeding at law or in
equity); and the Trust Agreement has been duly qualified under
the Trust Indenture Act;
(ix) Each of the Capital Securities Guarantee
Agreement and the Expenses Agreement has been duly authorized,
executed and delivered by Energy East and constitutes a valid
and legally binding obligation of Energy East, enforceable in
accordance with its terms, subject, as to enforcement, to
bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and other laws or judicial decisions of general
applicability relating to or affecting creditors' rights and
to general equity principles (regardless of whether
enforcement is considered in a proceeding at law or in
equity); and the Capital Securities Guarantee Agreement has
been duly qualified under the Trust Indenture Act;
(x) The Securities and the Operative Documents
conform in all material respects to the descriptions thereof
contained in the Registration Statement and the Prospectus;
(xi) The execution, delivery and performance of
the Operative Documents and the Debt Securities by Energy East
and the consummation of the transactions contemplated in the
Operative Documents, the Debt Securities and the Registration
Statement (including the issuance and sale of the Debt
Securities and the use of the proceeds from the sale of the
Debt Securities as described in the Prospectus under the
caption "Use of Proceeds") by Energy East and compliance by
Energy East with its obligations under the Operative Documents
and the Debt Securities will not conflict with or result in a
breach or violation of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument known
to such counsel to which Energy East or the Trust is a party
or by which Energy East or the Trust is bound, nor will such
actions result in any violation of the provisions of the
Certificate of Incorporation or By-laws of Energy East or any
statute or any order, rule or regulation known to such counsel
of any court or governmental agency or body having
jurisdiction over Energy East;
(xii) No consent, approval, authorization, order,
registration or qualification of or with any such court or
governmental agency or body is required for the issue and sale
of the Capital Securities or the issue of the Common
Securities, Capital Securities Guarantee or Debt Securities or
the consummation by Energy East of the transactions
contemplated by the Operative Documents, except such as have
been obtained under the Act, the Holding Company Act and such
consents, approvals, authorizations, orders, registrations or
qualifications as may be required under state securities or
Blue Sky laws in connection with the purchase and distribution
of the Capital Securities by the Underwriters;
(xiii) Neither Energy East nor any of its
Significant Subsidiaries is in violation of its By-laws or
Certificate of Incorporation and the Trust is not in
violation of the Trust Agreement or certificate of trust of
the Trust; none of Energy East, any of its Significant
Subsidiaries or the Trust is in default in the performance or
13
observance of any material obligation, agreement, covenant or
condition contained in any contract, indenture, mortgage, deed
of trust, loan agreement, lease or other instrument to which
it is a party;
(xiv) The statements set forth in the Prospectus
under the captions "Description of Junior Subordinated Debt
Securities," "Description of the Guarantees" and "Agreement as
to Expenses and Liabilities," insofar as they purport to
constitute a summary of the terms of Debt Securities and the
Capital Securities Guarantee and the Expense Agreement,
respectively, and under the captions "Material United States
Federal Income Tax Considerations" and "Plan of Distribution,"
insofar as they purport to describe the provisions of the laws
and documents referred to therein, are accurate, complete and
fair;
(xv) Each of Energy East and the Trust is not an
"investment company," as such term is defined in the
Investment Company Act;
(xvi) The documents incorporated by reference in
the Prospectus as amended or supplemented (other than the
financial statements, including the notes thereto and related
schedules therein, as to which such counsel need express no
opinion), when they were filed with the Commission, complied
as to form in all material respects with the requirements of
the Exchange Act, and the rules and regulations of the
Commission thereunder; and they have no reason to believe that
any of such documents, when they were so filed 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 when such documents were so filed, not misleading;
and
(xvii) The Registration Statement and the
Prospectus as amended or supplemented and any further
amendments and supplements thereto made by Energy East prior
to the Time of Delivery (other than the financial statements,
including the notes thereto, and related schedules therein, as
to which such counsel need express no opinion) comply as to
form in all material respects with the requirements of the Act
and the Trust Indenture Act and the rules and regulations
thereunder; although they do not assume any responsibility for
the accuracy, completeness or fairness of the statements
contained in the Registration Statement or the Prospectus,
except for those referred to in the opinion in subsection
(xiv) of this Section 7(c), they have no reason to believe
that, as of the date of effectiveness of the Registration
Statement and as of the Time of Delivery, the Registration
Statement (other than the financial statements, including the
notes thereto, and related schedules therein, as to which such
counsel need express no opinion) 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, as of its date and
as of the Time of Delivery, the Prospectus (other than the
financial statements, including the notes thereto, and related
schedules therein, as to which such counsel need express no
opinion) contained or contains an untrue statement of a
material fact or omits to state a material fact necessary to
make the statements therein, in the light of the
14
circumstances under which they were made, not misleading; and
they do not know of any amendment to the Registration
Statement as amended or supplemented required to be filed or
any contracts or other documents of a character required to be
filed as an exhibit to such Registration Statement or required
to be incorporated by reference into the Prospectus as amended
or supplemented or required to be described in the
Registration Statement or the Prospectus, each as amended or
supplemented, which are not filed or incorporated by reference
or described as required.
(d) Counsel for Energy East satisfactory to the
Representatives on behalf of the Underwriters in the respective states
of New York, Connecticut and Maine shall each have furnished to the
Underwriters their written opinion, dated the Time of Delivery, in form
and substance satisfactory to the Representatives on behalf of the
Underwriters, to the effect that:
(i) Energy East is in good standing under the
laws of such state, with power and authority (corporate and
other) to own its properties and conduct its business as
described in the Prospectus as amended or supplemented and is
duly qualified to transact business and is in good standing in
such state, except to the extent such failure to be so
qualified or be in good standing would not have a material
adverse effect on Energy East and its subsidiaries, taken as a
whole;
(ii) Energy East is not a public utility or
public service company subject to the jurisdiction of the
state commission or regulatory authority in the respective
state as a public utility or public service company;
(iii) No consent, approval, authorization, order,
registration or qualification of or with any court,
governmental agency or regulatory authority of such state is
required for the issue and sale of the Capital Securities or
for the issue of the Common Securities, the Capital Securities
Guarantee or the Debt Securities or the consummation by Energy
East of the transactions contemplated by the Operative
Documents, except such as have been obtained under the Act,
the Holding Company Act and such consents, approvals,
authorizations, orders, registrations or qualifications as
may be required under state securities or Blue Sky laws in
connection with the purchase and distribution of the Capital
Securities by the Underwriters; and
(iv) The issue and sale of the Capital Securities
and the compliance by Energy East with all of the provisions
of the Capital Securities, the Operative Documents and the
consummation of the transactions herein and therein
contemplated will not conflict with or result in a violation
of any statute or any order, rule or regulation known to such
counsel of any court or governmental agency or body in such
state or commonwealth having jurisdiction over Energy East.
(e) Xxxxxxxx, Xxxxxx & Finger, P.A., Delaware counsel for
the Trust and Energy East, shall have furnished to the Underwriters an
opinion, dated the Time of
15
Delivery, in form and substance satisfactory to the Representatives on
behalf of the Underwriters, to the effect that:
(i) The Trust has been duly created and is
validly existing in good standing as a business trust under
the Delaware Act, and all filings required under the laws of
the State of Delaware with respect to the creation and valid
existence of the Trust as a business trust have been made;
(ii) Under the Delaware Act and the Trust
Agreement, the Trust has the business trust power and
authority to own property and conduct its business, all as
described in the Prospectus;
(iii) Under the Delaware Business Trust Act and
the Trust Agreement, the Trust has the business trust power
and authority (a) to execute and deliver this Agreement, (b)
to perform its obligations under this Agreement and (c) to
issue and perform its obligations under the Capital Securities
and the Common Securities;
(iv) Under the Delaware Act and the Trust
Agreement, the execution and delivery by the Trust of this
Agreement and the performance by the Trust of its obligations
hereunder and under the Trust Agreement have been duly
authorized by all necessary business trust action on the part
of the Trust;
(v) The Trust Agreement constitutes a valid and
legally binding obligation of Energy East and the trustees
named therein, enforceable against Energy East and the
trustees named therein, in accordance with its terms, subject,
as to enforcement, to the effect upon the Trust Agreement of
(a) bankruptcy, insolvency, moratorium, receivership,
liquidation, fraudulent conveyance or transfer, reorganization
and other similar laws relating to or affecting the remedies
and rights of creditors generally, (b) principles of equity,
including applicable law relating to fiduciary duties
(regardless of whether considered or applied in a proceeding
in equity or at law) and (c) the effect of applicable public
policy on the enforceability of provisions relating to
indemnification or contribution;
(vi) The Capital Securities have been duly
authorized by the Trust Agreement and are duly and validly
issued and, subject to the qualifications set forth herein,
fully paid and non-assessable preferred undivided beneficial
interests in the assets of the Trust; the holders of the
Capital Securities, as beneficial owners of the Trust (the
"Securityholders"), are entitled to the same limitation of
personal liability extended to stockholders of private
corporations for profit organized under the General
Corporation Law of the State of Delaware; PROVIDED, HOWEVER,
that such counsel may note that the Securityholders may be
obligated, pursuant to the Trust Agreement, to (a) provide
indemnity and security in connection with and pay a sum
sufficient to cover any taxes or governmental charges arising
from transfers or exchanges of Capital Securities certificates
and the issuance of replacement Capital Securities
certificates and (b) provide security and indemnity in
connection with requests of or directions to the Property
Trustee
16
(as defined in the Trust Agreement) to exercise its rights and
powers under the Trust Agreement; and under the Delaware Act
and the Trust Agreement, the issuance of the Capital
Securities is not subject to preemptive or other similar
rights;
(vii) The Common Securities have been duly
authorized by the Trust Agreement and are duly and validly
issued and fully paid common undivided beneficial interests in
the assets of the Trust; and under the Delaware Act and the
Trust Agreement, the issuance of the Common Securities is not
subject to preemptive or other similar rights;
(viii) The issuance and sale by the Trust of the
Capital Securities and the Common Securities, the execution,
delivery and performance by the Trust of this Agreement, the
performance by the Trust of the Trust Agreement, the
consummation by the Trust of the transactions contemplated
herein and therein and the compliance by the Trust with its
obligations hereunder do not violate (a) any of the provisions
of the certificate of trust of the Trust or the Trust
Agreement or (b) any applicable Delaware law or Delaware
administrative regulation;
(ix) The statements set forth in the Prospectus
under the caption "Description of the Trust Preferred
Securities," insofar as they purport to constitute a summary
of the terms of the Capital Securities, are accurate, complete
and fair;
(x) Assuming that the Trust derives no income
from or connected with sources within the State of Delaware
and has no assets, activities (other than having a Delaware
trustee as required by the Delaware Act and the filing of
documents with the Secretary of State of the State of
Delaware) or employees in the State of Delaware, no
authorization, approval, consent or order of any Delaware
court or Delaware governmental authority or Delaware agency is
required to be obtained by the Trust solely as a result of the
issuance and sale of the Capital Securities, the consummation
by the Trust of the transactions contemplated in this
Agreement and the Trust Agreement or the compliance by the
Trust of its obligations hereunder and thereunder; and
(xi) Assuming that the Trust derives no income
from or connected with sources within the State of Delaware
and has no assets, activities (other than having a Delaware
trustee as required by the Delaware Act and the filing of
documents with the Secretary of State of the State of
Delaware) or employees in the State of Delaware, and assuming
that the Trust is treated as a grantor trust for federal
income tax purposes, the Securityholders (other than those
holders of the Capital Securities who reside or are domiciled
in the State of Delaware) will have no liability for income
taxes imposed by the State of Delaware solely as a result
17
of their participation in the Trust, and the Trust will not be
liable for any income tax imposed by the State of Delaware.
(f) _______________, counsel to Chase Manhattan Bank USA,
National Association, as Delaware Trustee under the Trust Agreement,
shall have furnished to the Underwriters, dated the Time of Delivery,
in form and substance satisfactory to the Representatives on behalf of
the Underwriters, to the effect that:
(i) The Delaware Trustee is duly incorporated,
validly existing in good standing as a banking association
under the federal laws of the United States of America and has
the power and authority to execute, deliver and perform its
obligations under the Trust Agreement;
(ii) The Trust Agreement has been duly
authorized, executed and delivered by the Delaware Trustee and
constitutes a legal, valid and binding obligation of the
Delaware Trustee, enforceable against the Delaware Trustee, in
accordance with its terms;
(iii) The execution and delivery of, and
performance of the terms of, the Trust Agreement by the
Delaware Trustee does not conflict with or constitute a breach
of or default under the charter or by-laws of the Delaware
Trustee; and
(iv) No consent, approval or authorization of, or
registration, declaration or filing with, any court or
governmental agency or body having jurisdiction in the
premises is required under federal law for the execution,
delivery or performance by the Delaware Trustee of the Trust
Agreement.
(g) Cravath, Swaine & Xxxxx, counsel to The Chase
Manhattan Bank, as Debt Securities Trustee, Guarantee Trustee and
Property Trustee, shall have furnished to the Underwriters their
opinion, dated the Time of Delivery, in form and substance satisfactory
to the Representatives on behalf of the Underwriters, to the effect
that:
(i) The Chase Manhattan Bank (the "Bank") has
been duly incorporated and is validly existing as a banking
corporation in good standing under the laws of the State of
New York;
(ii) The Bank has the corporate trust power and
authority to execute, deliver and perform its duties under the
Indenture, the Capital Securities Guarantee Agreement and the
Trust Agreement, has duly executed and delivered the
Indenture, the Capital Securities Guarantee Agreement and the
Trust Agreement, and, insofar as the laws governing the trust
powers of the Bank are concerned and assuming due
authorization, execution and delivery thereof by the other
parties thereto, each of the Indenture, the Capital Securities
Guarantee Agreement and the Trust Agreement constitutes a
legal, valid and binding agreement of the Bank, enforceable
against the Bank in accordance with its terms, subject to
applicable bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium or other laws affecting creditors'
rights generally from time to time in effect and to general
principles of equity (including, without limitation, concepts
18
of materiality, reasonableness, good faith and fair dealing),
regardless of whether considered in a proceeding in equity or
at law;
(iii) The execution, delivery and performance by
the Bank of the Indenture, the Capital Securities Guarantee
Agreement and the Trust Agreement do not conflict with or
constitute a breach of the charter or bylaws of the Bank; and
(iv) No approval, authorization or other action
by, or filing with, any governmental authority of the United
States of America or the State of New York having jurisdiction
over the trust powers of the Bank is required in connection
with the execution and delivery by the Bank of the Indenture,
the Capital Securities Guarantee Agreement or the Trust
Agreement or the performance by the Bank of its duties
thereunder, except such as have been obtained, taken or made.
(h) On the date hereof and at the Time of Delivery, the
independent accountants of Energy East who have certified the
consolidated financial statements of Energy East included or
incorporated by reference in the Registration Statement shall have
furnished to the Underwriters a letter to the effect set forth in
Exhibit A hereto with respect to such letter dated the date hereof, and
as to such other matters as the Underwriters may reasonably request and
in form and substance satisfactory to the Representatives on behalf of
the Underwriters with respect to such letter dated the Time of
Delivery;
(i) (i) Neither Energy East nor any of its subsidiaries
shall have sustained, since the date of the latest audited financial
statements included or incorporated by reference in the Prospectus, any
loss or interference with its business from fire, explosion, flood or
other calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, which would
result in any material adverse change, or any development involving a
prospective material adverse change, in or affecting the general
affairs, management, financial position, stockholders' equity or
results of operations of Energy East and its subsidiaries, taken as a
whole, otherwise than as set forth or contemplated in the Prospectus,
and (ii) since the date hereof there shall not have been any change in
the capital stock (other than pursuant to Energy East's common stock
repurchase program, or its dividend reinvestment and other common stock
plans), or long-term debt of Energy East or any of its Significant
Subsidiaries or any change, or any development involving a prospective
change, in or affecting the general affairs, management, financial
position, stockholders' equity or results of operations of Energy East
and its subsidiaries, taken as a whole, otherwise than as set forth or
contemplated in the Prospectus as of the date of this Agreement, the
effect of which, in any such case described in clause (i) or (ii), is
in the judgment of the Underwriters so material and adverse as to make
it impracticable or inadvisable to proceed with the public offering or
the delivery of the Capital Securities on the terms and in the manner
contemplated in the Prospectus;
19
(j) During the period beginning on the date hereof and
ending at the Time of Delivery (i) no downgrading shall have occurred
in the rating accorded Energy East's debt securities or preferred stock
by any "nationally recognized statistical rating organization," as that
term is defined by the Commission for purposes of Rule 436(g)(2) under
the Act, and (ii) no such organization shall have publicly announced
that it has under surveillance or review, with possible negative
implications, its rating of any of Energy East's debt securities or
preferred stock;
(k) During the period beginning on the date hereof and
ending at the Time of Delivery, there shall not have occurred any of
the following: (i) a suspension or material limitation in trading in
securities generally on the New York Stock Exchange or the
establishment of minimum prices on such exchange; (ii) a suspension or
material limitation in trading in Energy East's securities on the New
York Stock Exchange; (iii) a general moratorium on commercial banking
activities declared by either Federal or New York State authorities;
(iv) a material disruption of the United States government securities
market, United States corporate bond market or the United States
federal wire transfer system; and (v) an outbreak or escalation of
hostilities involving the United States or the declaration of a
national emergency or war by the United States, if the effect of any
such event specified in this clause (v) in the judgment of the
Representatives makes it impracticable or inadvisable to proceed with
the public offering or the delivery of the Securities on the terms and
in the manner contemplated in the Prospectus;
(l) Energy East shall have complied with the provisions
of Section 5(c) hereof with respect to the furnishing of prospectuses
on the New York business day next succeeding the date of this
Agreement; and
(m) Energy East shall have furnished or caused to be
furnished to the Underwriters at the Time of Delivery a certificate or
certificates of officers of Energy East and the Trust satisfactory to
the Representatives on behalf of the Underwriters as to the accuracy of
the representations and warranties of Energy East and the Trust herein
at and as of such Time of Delivery, as to the performance by Energy
East and the Trust of all of their respective obligations hereunder to
be performed at or prior to such Time of Delivery, as to the matters
set forth in subsections (a) and (i) of this Section and as to such
other matters as the Underwriters may reasonably request.
8. (a) Energy East agrees to indemnify and hold harmless
each Underwriter against any losses, claims, damages or liabilities, joint or
several, to which such Underwriter may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon an untrue statement or alleged
untrue statement of a material fact contained in the Preliminary Prospectus, the
Registration Statement, the Prospectus, or any amendment or supplement thereto,
or arise out of or are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, and will reimburse such Underwriter for any
legal or other expenses reasonably incurred by such Underwriter in connection
with investigating or defending any such action or claim as such expenses are
incurred; PROVIDED, HOWEVER, that Energy East shall not be liable in any such
case to the extent that any such loss, claim, damage or liability arises out of
or is based upon an untrue statement or alleged untrue
20
statement or omission or alleged omission made in the Preliminary Prospectus,
the Registration Statement, the Prospectus, or any such amendment or supplement
thereto, in reliance upon and in conformity with written information relating to
any Underwriter furnished to Energy East expressly for use in the Prospectus as
amended or supplemented.
(b) Each Underwriter will indemnify and hold harmless
Energy East against any losses, claims, damages or liabilities to which Energy
East may become subject, under the Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or
are based upon an untrue statement or alleged untrue statement of a material
fact contained in any Preliminary Prospectus, any preliminary prospectus
supplement, the Registration Statement, the Prospectus, or any amendment or
supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in any Preliminary
Prospectus, any preliminary prospectus supplement, the Registration Statement,
the Prospectus, or any amendment or supplement thereto in reliance upon and in
conformity with written information relating to such Underwriter furnished to
Energy East by such Underwriter expressly for use therein; and will reimburse
Energy East for any legal or other expenses reasonably incurred by Energy East
in connection with investigating or defending any such action or claim as such
expenses are incurred.
(c) Promptly after receipt by an indemnified party under
subsection (a) or (b) above of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have to
any indemnified party otherwise than under such subsection. In case any such
action shall be brought against any indemnified party and it shall notify the
indemnifying party of the commencement thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it shall wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel satisfactory to such indemnified party (who shall not,
except with the consent of the indemnified party, be counsel to the indemnifying
party), and, after notice from the indemnifying party to such indemnified party
of its election so to assume the defense thereof, the indemnifying party shall
not be liable to such indemnified party under such subsection for any legal
expenses of other counsel or any other expenses, in each case subsequently
incurred by such indemnified party, in connection with the defense thereof other
than reasonable costs of investigation. No indemnifying party shall, without the
written consent of the indemnified party, effect the settlement or compromise
of, or consent to the entry of any judgment with respect to, any pending or
threatened action or claim in respect of which indemnification or contribution
may be sought hereunder (whether or not the indemnified party is an actual or
potential party to such action or claim) unless such settlement, compromise or
judgment (i) includes an unconditional release of the indemnified party from all
liability arising out of such action 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) If the indemnification provided for in this Section 8
is unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of
21
any losses, claims, damages or liabilities (or actions in respect thereof)
referred to therein, then each indemnifying party shall contribute to the amount
paid or payable by such indemnified party as a result of such losses, claims,
damages or liabilities (or actions in respect thereof) in such proportion as is
appropriate to reflect the relative benefits received by Energy East on the one
hand and the Underwriters on the other to which such loss, claim, damage or
liability (or action in respect thereof) relates. If, however, the allocation
provided by the immediately preceding sentence is not permitted by applicable
law or if the indemnified party failed to give the notice required under
subsection (c) above, then each indemnifying party shall contribute to such
amount paid or payable by such indemnified party in such proportion as is
appropriate to reflect not only such relative benefits but also the relative
fault of Energy East on the one hand and the Underwriters of the Capital
Securities on the other in connection with the statements or omissions which
resulted in such losses, claims, damages or liabilities (or actions in respect
thereof), as well as any other relevant equitable considerations. The relative
benefits received by Energy East on the one hand and the Underwriters on the
other shall be deemed to be in the same proportion as the total net proceeds
from such offering (before deducting expenses) received by Energy East bear to
the total underwriting discounts and commissions received by the Underwriters.
The relative fault shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by Energy East on the one hand or such Underwriters on the other and
the parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission. Energy East and the
Underwriters agree that it would not be just and equitable if contribution
pursuant to this subsection (d) were determined by PRO RATA allocation (even if
the Underwriters were treated as one entity for such purpose) or by any other
method of allocation which does not take account of the equitable considerations
referred to above in this subsection (d). The amount paid or payable by an
indemnified party as a result of the losses, claims, damages or liabilities (or
actions in respect thereof) referred to above in this subsection (d) shall be
deemed to include any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such action
or claim. Notwithstanding the provisions of this subsection (d), no Underwriter
shall be required to contribute any amount in excess of the amount by which the
total price at which the Capital Securities underwritten by it and distributed
to the public were offered to the public exceeds the amount of any damages which
such Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The obligations of the Underwriters in this
subsection (d) to contribute are several in proportion to their respective
underwriting obligations with respect to such Capital Securities and not joint.
(e) The obligations of Energy East under this Section 8
shall be in addition to any liability which Energy East may otherwise have and
shall extend, upon the same terms and conditions, to each person, if any, who
controls Energy East within the meaning of the Act; and the obligations of the
Underwriters under this Section 8 shall be in addition to any liability which
the respective Underwriters may otherwise have and shall extend, upon the same
terms and conditions, to each officer and director of any Underwriter and to
each person, if any, who controls an Underwriter, within the meaning of the Act.
22
9. (a) If any Underwriter shall default in its
obligation to purchase the Capital Securities which it has agreed to purchase
under this Agreement, the non-defaulting Underwriters may in their discretion
arrange for themselves or another party or other parties to purchase such
Capital Securities on the terms contained herein. If within thirty-six hours
after such default by any Underwriter the non-defaulting Underwriters do not
arrange for the purchase of such Capital Securities, then Energy East shall be
entitled to a further period of thirty-six hours within which to procure another
party or other parties satisfactory to the non-defaulting Underwriters to
purchase such Capital Securities on such terms. In the event that, within the
respective prescribed period, the non-defaulting Underwriters notify Energy East
that they have so arranged for the purchase of such Capital Securities, or
Energy East notifies the non-defaulting Underwriters that it has so arranged for
the purchase of such Capital Securities, the non-defaulting Underwriters or
Energy East shall have the right to postpone the Time of Delivery for a period
of not more than seven days, in order to effect whatever changes may thereby be
made necessary in the Registration Statement or the Prospectus as amended or
supplemented, or in any other documents or arrangements, and Energy East agrees
to file promptly any amendments or supplements to the Registration Statement or
the Prospectus which in the opinion of the non-defaulting Underwriters may
thereby be made necessary. The term "Underwriter" as used in this Agreement
shall include any person substituted under this Section with like effect as if
such person had originally been a party to this Agreement.
(b) If, after giving effect to any arrangements for the
purchase of the Capital Securities of a defaulting Underwriter or Underwriters
by the non-defaulting Underwriters and Energy East as provided in subsection (a)
above, the number of Capital Securities which remains unpurchased does not
exceed one-eleventh of the number of Capital Securities, then Energy East shall
have the right to require each non-defaulting Underwriter to purchase the number
of Capital Securities which such non-defaulting Underwriter agreed to purchase
under this Agreement and, in addition, to require each non-defaulting
Underwriter to purchase its pro rata share (based on the number of Capital
Securities which such Underwriter agreed to purchase hereunder) of the Capital
Securities which such defaulting Underwriter or Underwriters agreed to purchase
for which such arrangements have not been made; but nothing herein shall relieve
a defaulting Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the
purchase of the Capital Securities of a defaulting Underwriter or Underwriters
by the non-defaulting Underwriters and Energy East as provided in subsection (a)
above, the number of Capital Securities which remains unpurchased exceeds
one-eleventh of the number of Capital Securities, as referred to in subsection
(b) above, or if Energy East shall not exercise the right described in
subsection (b) above to require non-defaulting Underwriters to purchase Capital
Securities of the defaulting Underwriter or Underwriters, then this Agreement
shall thereupon terminate, without liability on the part of any non-defaulting
Underwriter or Energy East, except for the expenses to be borne by Energy East
and the Underwriters as provided in Section 6 hereof and the indemnity and
contribution agreements in Section 8 hereof; but nothing herein shall relieve
the defaulting Underwriter from liability for its default.
10. The respective indemnities, agreements,
representations, warranties and other statements of Energy East and the Trust,
if applicable, and the several Underwriters, as set forth in this Agreement or
made by or on behalf of them, respectively, pursuant to this
23
Agreement, shall remain in full force and effect, regardless of any
investigation (or any statement as to the results thereof) made by or on behalf
of any Underwriter, or any controlling person of any Underwriter, or Energy
East, or any officer or director or controlling person of Energy East, and shall
survive delivery of and payment for the Capital Securities.
11. All statements, requests, notices and agreements
hereunder shall be in writing, and if to the Underwriters shall be delivered or
sent by mail, telex or facsimile transmission to the address of such
Underwriters; if to __________; if to __________; and if to Energy East shall be
delivered or sent by mail, telex or facsimile transmission to Energy East
Corporation, X.X. Xxx 00000, Xxxxxx, XX 00000-0000, Attn: Treasurer; and if to
the Trust or the Administrative Trustees shall be delivered or sent by mail,
telex or facsimile transmission to Energy East Corporation, X.X. Xxx 00000,
Xxxxxx, XX 00000-0000, Attention: Treasurer; PROVIDED, HOWEVER, that any notice
to an Underwriter pursuant to Section 8(c) hereof shall be delivered or sent by
mail, telex or facsimile transmission to such Underwriter at its address set
forth above. Any such statements, requests, notices or agreements shall take
effect upon receipt thereof.
12. If either Energy East or the Trust fails or refuses
to comply with the terms or to fulfill any of the conditions of this Agreement
other than by reason of default by the Underwriters, Energy East will reimburse
the Underwriters for all out-of-pocket expenses approved in writing by the
Underwriters, including fees and disbursements of counsel, reasonably incurred
by the Underwriters in making preparations for the purchase of the Capital
Securities.
13. This Agreement shall be binding upon, and inure
solely to the benefit of, the Underwriters and Energy East and the Trust and, to
the extent provided in Sections 8 and 10 hereof, the officers and directors of
Energy East and each person who controls any Underwriter or Energy East, and
their respective heirs, executors, administrators, successors and assigns, and
no other person shall acquire or have any right under or by virtue of this
Agreement. No purchaser of any of the Capital Securities from any Underwriter
shall be deemed a successor or assign by reason merely of such purchase.
14. As used herein, "business day" shall mean any day
when the Commission's office in Washington, D.C. is open for business. Except as
expressly provided in this agreement, all capitalized terms used and not defined
herein shall have the meanings assigned to them in the Indenture.
15. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
16. This Agreement may be executed by any one or more of
the parties hereto and thereto in any number of counterparts, each of which
shall be deemed to be an original, but all such respective counterparts shall
together constitute one and the same instrument.
24
If the foregoing is in accordance with your understanding,
please sign and return to us six counterparts hereof.
Very truly yours,
ENERGY EAST CAPITAL TRUST [ ]
By: ENERGY EAST CORPORATION, as
Sponsor
By: ________________________________
Name:
Title:
ENERGY EAST CORPORATION
By: ________________________________
Name:
Title:
Accepted as of the date hereof:
[Name of Representatives]
Each acting severally on behalf of itself and for the several Underwriters named
herein.
By: [NAME OF REPRESENTATIVE]
By: ____________________________
Authorized Signatory
Name:
Title:
By: [NAME OF REPRESENTATIVE]
By: ____________________________
Authorized Signatory
Name:
Title:
For themselves and on behalf of the several Underwriters named in Schedule A
hereto.
SCHEDULE A
NUMBER OF CAPITAL SECURITIES
UNDERWRITERS TO BE PURCHASED
------------ --------------------------------------
---------------
Total:
SCHEDULE B
Title of Security: ___% Capital Securities
Distribution Rate on Capital Securities: ___%
Coupon on Debt Securities: ___%
Total Number of Capital Securities Being Offered: _________
Price to Public Per Capital Security: $_________
Total Price to Public: $_________
Underwriting Commissions Per Capital Security: $____
Total of Underwriting Commissions: $_________
Proceeds to the Trust Per Capital Security: $_________
Total Proceeds to the Trust: $_________
Time of Delivery ____________________, 9:30 A.M.
Closing Location: 000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
The Capital Securities will be available for inspection by the Representatives
at:
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Address for Notices to the Underwriters:
[Name and Address of Representatives]
with a copy of any notice pursuant to Section 9(c) also sent to:
[Name and Address of Representatives]
EXHIBIT A
Pursuant to Section 7(h) of the Underwriting Agreement, the
accountants shall furnish letters to the Underwriters to the effect that:
(i) They are independent certified public accountants
with respect to Energy East and its subsidiaries within the meaning of
the Act and the applicable rules and regulations adopted by the
Commission;
(ii) In their opinion, the financial statements and any
supplementary financial information and schedules audited (and, if
applicable, financial forecasts and/or pro forma financial information)
examined by them and included or incorporated by reference in the
Registration Statement or the Prospectus comply as to form in all
material respects with the applicable accounting requirements of the
Act or the Exchange Act, as applicable, and the related rules and
regulations; and, if applicable, they have made a review in accordance
with standards established by the American Institute of Certified
Public Accountants of the consolidated interim financial statements,
selected financial data, pro forma financial information, financial
forecasts and/or condensed financial statements derived from audited
financial statements of Energy East for the periods specified in such
letter, as indicated in their reports thereon, copies of which have
been furnished to the Underwriters;
(iii) They have made a review in accordance with standards
established by the American Institute of Certified Public Accountants
of the unaudited condensed consolidated statements of income,
consolidated balance sheets and consolidated statements of cash flows
included in the Prospectus and/or included in Energy East's quarterly
report on Form 10-Q incorporated by reference into the Prospectus; and
on the basis of specified procedures including inquiries of officials
of Energy East who have responsibility for financial and accounting
matters regarding whether the unaudited condensed consolidated
financial statements referred to in paragraph (vi)(A)(i) below comply
as to form in all material respects with the applicable accounting
requirements of the Act and the Exchange Act and the related rules and
regulations, nothing came to their attention that caused them to
believe that the unaudited condensed consolidated financial statements
do not comply as to form in all material respects with the applicable
accounting requirements of the Act and the Exchange Act and the related
rules and regulations adopted by the Commission;
(iv) The unaudited selected financial information with
respect to the consolidated results of operations and financial
position of Energy East for the five most recent fiscal years included
in the Prospectus and included or incorporated by reference in Item 6
of Energy East's Annual Report on Form 10-K for the most recent fiscal
year agrees with the corresponding amounts (after restatement where
applicable) in the audited consolidated financial statements for five
such fiscal years included or incorporated by reference in Energy
East's Annual Reports on Form 10-K for such fiscal years;
(v) They have compared the information in the Prospectus
under selected captions with the disclosure requirements of Regulation
S-K and on the basis of limited procedures specified in such letter
nothing came to their attention as a result of the foregoing procedures
that caused them to believe that this information does not conform in
all material respects with the disclosure requirements of Items 301,
302 and 503(d), respectively, of Regulation S-K;
(vi) On the basis of limited procedures, not constituting
an examination in accordance with generally accepted auditing
standards, consisting of a reading of the unaudited financial
statements and other information referred to below, a reading of the
latest available interim financial statements of Energy East and its
subsidiaries, inspection of the minute books of Energy East and its
subsidiaries since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus, inquiries of
officials of Energy East and its subsidiaries responsible for financial
and accounting matters and such other inquiries and procedures as may
be specified in such letter, nothing came to their attention that
caused them to believe that:
(A) (i) the unaudited condensed consolidated
statements of income, consolidated balance sheets and
consolidated statements of cash flows included in the
Prospectus and/or included or incorporated by reference in
Energy East's Quarterly Reports on Form 10-Q incorporated by
reference in the Prospectus do not comply as to form in all
material respects with the applicable accounting requirements
of the Exchange Act and the published rules and regulations
adopted by the Commission, or (ii) any material modifications
should be made to the unaudited condensed consolidated
statements of income, consolidated balance sheets and
consolidated statements of cash flows included in the
Prospectus or included in Energy East's Quarterly Reports on
Form 10-Q incorporated by reference in the Prospectus for them
to be in conformity with generally accepted accounting
principles;
(B) any other unaudited income statement data
and balance sheet items included in the Prospectus do not
agree with the corresponding items in the unaudited
consolidated financial statements from which such data and
items were derived, and any such unaudited data and items were
not determined on a basis substantially consistent with the
basis for the corresponding amounts in the audited
consolidated financial statements included or incorporated by
reference in Energy East's Annual Report on Form 10-K for the
most recent fiscal year;
(C) the unaudited financial statements which
were not included in the Prospectus but from which were
derived the unaudited condensed financial statements referred
to in clause (A) and any unaudited income statement data and
balance sheet items included in the Prospectus and referred to
in clause (B) were not determined on a basis substantially
consistent with the basis for the audited financial statements
included or incorporated by reference in Energy East's Annual
Report on Form 10-K for the most recent fiscal year;
2
(D) any unaudited pro forma consolidated
condensed financial statements included or incorporated by
reference in the Prospectus do not comply as to form in all
material respects with the applicable accounting requirements
of the Act and the rules and regulations adopted by the
Commission thereunder or the pro forma adjustments have not
been properly applied to the historical amounts in the
compilation of those statements;
(E) as of a specified date not more than five
days prior to the date of such letter, there have been any
changes in the consolidated capital stock (other than
issuances of capital stock upon exercise of options and stock
appreciation rights, upon earn-outs of performance shares and
upon conversions of convertible securities, in each case which
were outstanding on the date of the latest balance sheet
included or incorporated by reference in the Prospectus) or
any increase in the consolidated long-term debt of Energy East
and its subsidiaries, or any decreases in consolidated net
current assets or stockholders' equity or other items
specified by the Underwriter, or any increases in any items
specified by the Underwriters, in each case as compared with
amounts shown in the latest balance sheet included or
incorporated by reference in the Prospectus, except in each
case for changes, increases or decreases which the Prospectus
discloses have occurred or may occur or which are described in
such letter; and
(F) for the period from the date of the latest
financial statements included or incorporated by reference in
the Prospectus to the specified date referred to in clause (E)
there were any decreases in consolidated net revenues or
operating profit or the total or per share amounts of
consolidated net income or other items specified by the
Underwriters, or any increases in any items specified by the
Underwriters, in each case as compared with the comparable
period of the preceding year and with any other period of
corresponding length specified by the Underwriters, except in
each case for increases or decreases which the Prospectus
discloses have occurred or may occur or which are described in
such letter; and
(vii) In addition to the audit referred to in their
report(s) included or incorporated by reference in the Prospectus and
the limited procedures, inspection of minute books, inquiries and other
procedures referred to in paragraphs (iii) and (vi) above, they have
carried out certain specified procedures, not constituting an audit in
accordance with generally accepted auditing standards, with respect to
certain amounts, percentages and financial information specified by the
Underwriters which are derived from the general accounting records of
Energy East and its subsidiaries, which appear in the Prospectus
(excluding documents incorporated by reference), or in Part II of, or
in exhibits and schedules to, the Registration Statement specified by
the Underwriters or in documents incorporated by reference in the
Prospectus specified by the Underwriters, and have compared certain of
such amounts, percentages and financial information with the accounting
records of Energy East and its subsidiaries and have found them to be
in agreement.
3
