Exhibit _1(a)
BALTIMORE GAS AND ELECTRIC COMPANY
UNSECURED DEBT SECURITIES
FORM OF PURCHASE AGREEMENT
INCLUDING
STANDARD PURCHASE PROVISIONS
BALTIMORE GAS AND ELECTRIC COMPANY
Unsecured Debt Securities
PURCHASE AGREEMENT
[Date]
Baltimore Gas and Electric Company
000 X. Xxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Dear Sirs:
Referring to the Unsecured Debt Securities of Baltimore Gas and Electric
Company (the "Company") covered by the registration statement on Form S-3 (No.
333-________), (such registration statement, including (i) the prospectus
included therein, dated _________________, as supplemented by a prospectus
supplement dated ____________ in the form first filed under Rule 424(b) (such
prospectus as so supplemented, including each document incorporated by reference
therein is hereinafter called the "Prospectus") and (ii) all documents filed as
part thereof or incorporated by reference therein, together with any
registration statement, increasing the size of the offering (a "Rule 462(b)
Registration Statement"), filed pursuant to Rule 462(b) under the Securities
Act of 1933, as amended, are hereinafter collectively called the
"Registration Statement") on the basis of the representations, warranties and
agreements contained in this Agreement, but subject to the terms and
conditions herein set forth, the purchaser or purchasers named in Schedule A
hereto (the "Purchasers") agree to purchase, severally, and the Company
agrees to sell to the Purchasers, severally, the respective principal amounts
of the Company's ___________ Series, due ____________having the terms
described below (the "Purchased Notes") set forth opposite the name of each
Purchaser on Schedule A hereto.
The price at which the Purchased Notes shall be purchased from the
Company by the Purchasers shall be ______% of the principal amount plus accrued
interest, if any, from _____________. The initial public offering price shall be
_____% of the principal amount plus accrued interest, if any, from
____________________. The Purchased Notes will be offered by the
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Purchasers as set forth in the Prospectus Supplement relating to such Purchased
Notes.
The Purchased Notes will have the following terms:
Fixed Interest rate (if applicable): _______% per annum
(accruing from ____)
Floating Interest Rate (if applicable):
Interest Rate Basis: ___________________
Spread: ___________________
Spread Multiplier: ___________________
Index Maturity: ___________________
Initial Interest Rate: ___________________
Maximum Interest Rate: ___________________
Minimum Interest Rate: ___________________
Interest Reset Dates: ___________________
Interest Determination Dates: ___________________
Calculation Agent: ___________________
Interest Payment Dates: ___________________
Stated Maturity: ___________________
Redeemable by the Redemption Prices
Company on or after: (% of Principal Amount):
--------------------- ---------------------
--------------------- ---------------------
--------------------- ---------------------
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Subject to Repurchase by
the Company at the option of Repurchase Prices
the holder on: (% of Principal Amount):
--------------------- ---------------------
--------------------- ---------------------
--------------------- ---------------------
The "Closing Date" shall be: _____________________
The place to which the
Purchased Notes may be
checked, packaged and
delivered shall be: _____________________
Notices to the Purchasers shall be sent to the following
address(es) or telecopier number(s):
If we are acting as Representative(s) for the several Purchasers named
in Schedule A hereto, we represent that we are authorized to act for such
several Purchasers in connection with the transactions contemplated in this
Agreement, and that, if there are more than one of us, any action under this
Agreement taken by any of us will be binding upon all the Purchasers.
All of the provisions contained in the document entitled "Baltimore Gas
and Electric Company Standard Purchase Provisions", a copy of which has been
previously furnished to us, are hereby incorporated by reference in their
entirety and shall be deemed to be a part of this Agreement to the same extent
as if such provisions had been set forth in full herein.
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If the foregoing is in accordance with your understanding of our
agreement, kindly sign and return to us the enclosed duplicate hereof, whereupon
it will become a binding agreement between the Company and the several
Purchasers in accordance with its terms.
Very truly yours,
[Firm Name]
By ________________________
Title: _______________________
Acting on behalf of
and as Representative(s) of
the several Purchasers named in
Schedule A hereto.*
The foregoing Purchase
Agreement is hereby confirmed
as of the date first above
written
BALTIMORE GAS AND ELECTRIC COMPANY
By ____________________
Title: _____________________
* To be deleted if the Purchase Agreement is not executed by one or more
Purchasers acting as Representative(s) of the Purchasers for purposes of this
Agreement.
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SCHEDULE A
Name of Purchaser Amount
----------------- ------
Total
-----------
$
===========
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BALTIMORE GAS AND ELECTRIC COMPANY
STANDARD PURCHASE PROVISIONS
From time to time, Baltimore Gas and Electric Company, a
Maryland
corporation ("Company") may enter into
purchase agreements that provide for the
sale of designated securities to the purchaser or purchasers named therein. The
standard provisions set forth herein may be incorporated by reference in any
such
purchase agreement ("
Purchase Agreement"). The
Purchase Agreement,
including the provisions incorporated therein by reference, is herein sometimes
referred to as "this Agreement." Unless otherwise defined herein, terms defined
in the
Purchase Agreement are used herein as therein defined.
1. INTRODUCTORY. The Company proposes to issue and sell from time
to time its Unsecured Debt Securities ("Notes") registered under the
registration statement referred to in Section 2(a). The Notes will be issued
under an Indenture, dated as of July 1, 1985, between the Company and The Bank
of New York (successor to Mercantile-Safe Deposit and Trust Company), as Trustee
as supplemented by the Supplemental Indentures dated as of October 1, 1987 and
January 26, 1993, respectively (the "Indenture"). The Notes will be sold to the
Purchasers for resale in accordance with the terms of the offering determined at
the time of the sale. The Notes involved in any such offering are hereinafter
referred to as the "Purchased Notes," and the firm or firms, as the case may be,
which agree to purchase the same are hereinafter referred to as the "Purchasers"
of such Purchased Notes. The terms "you" and "your" refer to those Purchasers
who sign the
Purchase Agreement either on behalf of themselves only or on behalf
of themselves and as representatives of the several Purchasers named in Schedule
A thereto, as the case may be.
2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
represents and warrants to and agrees with each Purchaser that:
(a) A registration statement on Form S-3 (No. 333-________)
covering $400 million principal amount of the Notes, including a
prospectus has been filed with the Securities and Exchange Commission
("Commission") and has become effective. The terms Registration
Statement and Prospectus shall have the meanings ascribed to them in the
Purchase Agreement.
(b) The Registration Statement conforms in all respects to the
requirements of the Securities Act of 1933, as amended ("Act"), and the
pertinent published rules and regulations of the Commission thereunder
("33 Act Rules and Regulations") and the Trust Indenture Act of 1939, as
amended ("Trust Indenture Act"), and does not include any untrue
statement of a material fact or omit to state any material fact required
to be stated therein or necessary to make the statements therein not
misleading, except that the foregoing does not
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apply to statements or omissions in such document based upon written
information furnished to the Company by any Purchaser specifically for
use therein. The documents incorporated by reference in the
Registration Statement or the Prospectus pursuant to Item 12 of Form
S-3 of the Act, at the time they were filed with the Commission,
complied in all material respects with the requirements of the
Securities Exchange Act of 1934, as amended ("Exchange Act"), and the
pertinent published rules and regulations thereunder ("Exchange Act
Rules and Regulations"). Any additional documents deemed to be
incorporated by reference in the Prospectus will, when they are filed
with the Commission, comply in all material respects with the
requirements of the Exchange Act and the Exchange Act Rules and
Regulations 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, in light of the circumstances
under which they were made, not misleading.
3. DELIVERY AND PAYMENT. The Company will deliver the Purchased
Notes to you for the accounts of the Purchasers, at the offices of the Trustee
(at the place specified in the Purchase Agreement) against payment of the
purchase price by certified or official bank check or checks in same day or New
York or Baltimore Clearing House funds drawn to the order of the Company, at the
office of the Company, 000 X. Xxxxx Xxxxxx, 00xx Xxxxx, Xxxxxxxxx, Xxxxxxxx, at
the time set forth in this Agreement or at such other time not later than seven
full business days thereafter as you and the Company determine, such time being
herein referred to as the "Closing Date." The Purchased Notes to be delivered
will be in definitive fully registered form registered in such denominations, of
$1,000 or multiples thereof, and in such names as you request in writing not
later than 3:00 p.m., New York Time, on the third full business day prior to the
Closing Date, or, if no such request is received, in the names of the respective
Purchasers in the amounts agreed to be purchased by them pursuant to this
Agreement. The Company shall make the Purchased Notes available for checking and
packaging at the offices of the Trustee (at the place specified in the Purchase
Agreement) prior to the Closing Date and, unless prevented from doing so by
circumstances beyond its control, not later than 2:00 p.m., New York Time, on
the business day next preceding the Closing Date. If you request that any
Purchased Notes be issued in a name or names other than that of the Purchaser
agreeing to purchase such Purchased Notes hereunder, the Company shall not be
obligated to pay any transfer taxes resulting therefrom. The Notes may also be
represented by a permanent global Note or Notes, registered in the name of The
Depository Trust Company, as depositary (the "Depositary"), or a nominee of the
Depositary (each such Note represented by a permanent global Note being referred
to herein as a "Book-Entry Note"). Beneficial interests in Book-Entry Notes will
only be evidenced by, and transfers thereof will only be effected through,
records maintained by the Depositary's participants.
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4. OFFERING BY THE PURCHASERS. The several Purchasers propose to
offer the Purchased Notes for sale to the public as set forth in the Prospectus.
5. COVENANTS OF THE COMPANY. The Company covenants and agrees
with the several Purchasers that:
(a) It will promptly cause the Prospectus to be filed with the
Commission as required by Rule 424.
(b) For as long as a prospectus relating to the Purchased Notes
is required to be delivered under the Act, if any event relating to or
affecting the Company or of which the Company shall be advised in
writing by the Purchasers shall occur which, in the Company's opinion,
should be set forth in a supplement or amendment to the Prospectus in
order either to make the Prospectus comply with the requirements of the
Act or which would require the making of any change in the Prospectus so
that as thereafter delivered to purchasers such Prospectus will not
contain any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading,
the Company will promptly amend or supplement the Prospectus by either
(i) preparing and filing with the Commission supplement(s) or
amendment(s) to the Prospectus, or (ii) making an appropriate filing
pursuant to the Exchange Act, which will supplement or amend the
Prospectus so that, as supplemented or amended, the Prospectus when the
Prospectus is delivered to a purchaser will comply with the Act and will
not contain any untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading.
Prior to any such filing, the Company shall give oral notice to the
Purchasers.
(c) The Company will make generally available to its security
holders as soon as practicable, but in any event not later than eighteen
months after the effective date of the Registration Statement (as
defined in Rule 158(c) under the Act), an earnings statement of the
Company 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 the Company Rule 158).
(d) The Company will furnish to you copies of the following
documents, in each case as soon as available after filing and in such
quantities as you reasonably request (i) the Registration Statement
relating to the Notes as originally filed and all pre-effective
amendments thereto (at least one of which will be signed and will
include all exhibits except those incorporated by reference to previous
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filings with the Commission); (ii) each prospectus relating to the
Purchased Notes; and (iii) during the time when a prospectus relating to
the Purchased Notes is required to be delivered under the Act, all
post-effective amendments and supplements to the Registration Statement
or Prospectus, respectively (except supplements relating to securities
that are not Purchased Notes).
(e) The Company will take such action as the Purchasers may
reasonably request to obtain the qualification of the Purchased Notes
for sale and the determination of their eligibility for investment under
the laws of such jurisdictions as you designate and will continue such
qualifications in effect so long as required for the distribution,
provided, however, that the Company shall not be required to qualify as
a foreign corporation or to file any consent to service of process under
the laws of any jurisdiction or to comply with any other requirements
deemed by the Company to be unduly burdensome.
(f) During the period of five years after the Closing Date, the
Company will furnish to you, and upon request, to each of the other
Purchasers: (i) as soon as practicable after the end of each fiscal
year, a copy of its annual report to shareholders for such year, (ii) as
soon as available, a copy of each report or definitive proxy statement
of the Company filed with the Commission under the Exchange Act or
mailed to shareholders, and (iii) from time to time, such other
information concerning the Company as you may reasonably request.
(g) The Company will pay all expenses incident to the performance
of its obligations under this Agreement, and will reimburse the
Purchasers for any expenses (including Blue Sky fees not exceeding
$7,500 and disbursements of counsel) incurred by them in connection with
qualification of the Purchased Notes for sale and determination of their
eligibility for investment under the laws of such jurisdictions as you
designate and the printing of memoranda relating thereto, for any filing
fees charged by investment rating agencies for the rating of the
Purchased Notes, for any expenses incurred in connection with listing
the Purchased Notes on a national securities exchange and for expenses
incurred in distributing prospectuses to the Purchasers, except that if
this Agreement is terminated by the Purchasers under Section 6(c)
hereof, the Company shall not be obligated to reimburse the Purchasers
for any of the foregoing expenses.
(h) The Company will not offer or sell any of its other debt
securities which are substantially similar to the Purchased Notes
prior to ten business days after
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the Closing Date, without the consent of the Purchasers.
(i) If the Company elects to rely upon Rule 462(b), the
Company shall file a Rule 462(b) Registration Statement with the
Commission in compliance with Rule 462(b) and the Company shall
at the time of filing either pay to the Commission the filing fee for
the Rule 462(b) Registration Statement or give irrevocable instructions
for the payment of such fee pursuant to Rule 111(b) under the Act.
6. CONDITIONS OF THE OBLIGATIONS OF THE PURCHASERS. The
obligations of the several Purchasers to purchase and pay for the Purchased
Notes will be subject to the accuracy of the representations and warranties on
the part of the Company herein, to the accuracy of the statements of Company
officers made pursuant to the provisions hereof, to the performance by the
Company of its obligations hereunder and to the following additional conditions
precedent:
(a) Subsequent to the signing of this Agreement, you shall have
received a letter of PricewaterhouseCoopers LLP, dated the Closing Date,
confirming that they are independent public accountants within the
meaning of the Act and the 33 Act Rules and Regulations, and stating in
effect that:
(i) In their opinion, the consolidated financial
statements and supporting schedules audited by them which are
included in the Company's Form 10-K ("Form 10-K"), which is
incorporated by reference in the Registration Statement comply in
form in all material respects with the applicable accounting
requirements of the Act and the 33 Act Rules and Regulations and
the Exchange Act and the Exchange Act Rules and Regulations;
(ii) On the basis of procedures specified in such letter
(but not an audit in accordance with generally accepted auditing
standards), including reading the minutes of meetings of the
shareholders, the Board of Directors and the Executive Committee
of the Company since the end of the year covered by the Form 10-K
as set forth in the minute books through a specified date not
more than five days prior to the Closing Date, performing
procedures specified in Statement on Auditing Standards No. 71,
Interim Financial Information, on the unaudited interim
consolidated financial statements of the Company incorporated by
reference in the Registration Statement, if any, and reading the
latest available unaudited interim consolidated financial
statements of the Company, and making inquiries of certain
officials of the Company who have responsibility for financial
and accounting matters as to whether the latest available
financial statements not incorporated by reference in the
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Registration Statement are prepared on a basis substantially
consistent with that of the audited consolidated financial
statements incorporated in the Registration Statement, nothing
has come to their attention that has caused them to believe that
(1) any unaudited consolidated financial statements incorporated
by reference in the Registration Statement do not comply in form
in all material respects with the applicable requirements of the
Act and the 33 Act Rules and Regulations and the Exchange Act and
the Exchange Act Rules and Regulations or any material
modifications should be made to those unaudited consolidated
financial statements for them to be in conformity with generally
accepted accounting principles; (2) at the date of the latest
available balance sheet not incorporated by reference in the
Registration Statement there was any change in the capital stock,
change in long-term debt or decrease in consolidated net assets
or common shareholders' equity as compared with the amounts shown
in the latest balance sheet incorporated by reference in the
Registration Statement or for the period from the closing date of
the latest income statement incorporated by reference in the
Registration Statement to the closing date of the latest
available income statement read by them there were any decreases,
as compared with the corresponding period of the previous year,
in operating revenues, operating income, net income, or in
earnings per share of common stock except in all instances of
changes or decreases that the Registration Statement discloses
have occurred or may occur, or which are described in such
letter; or (3) at a specified date not more than five days prior
to the Closing Date, there was any change in the capital stock or
long-term debt of the Company or, at such date, there was any
decrease in net assets of the Company as compared with amounts
shown in the latest balance sheet incorporated by reference in
the Registration Statement, or for the period from the closing
date of the latest income statement incorporated by reference in
the Registration Statement to a specified date not more than five
days prior to the Closing Date, there were any decreases as
compared with the corresponding period of the previous year, in
operating revenues, operating income, net income or in earnings
applicable to common stock, except in all cases for changes or
decreases which the Registration Statement discloses have
occurred or may occur, or which are described in such letter; and
(iii) Certain specified procedures have been applied to
certain financial or other statistical information (to the extent
such information was obtained from the general accounting records
of the Company) set forth or incorporated by reference in the
Registration Statement and that such procedures have not revealed
any
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disagreement between the financial and statistical
information so set forth or incorporated and the underlying
general accounting records of the Company, except as described in
such letter.
(b) Prior to the Closing Date, no stop order suspending the
effectiveness of the Registration Statement shall have been issued and
no proceedings for that purpose shall have been instituted, or to the
knowledge of the Company or you, shall be contemplated by the
Commission, and if the Company has elected to rely upon Rule 462(b), the
Rule 462(b) Registration Statement shall have been filed and shall
have become effective in accordance with Rule 462(b).
(c) Subsequent to the date of this Agreement, (i) there shall not
have occurred any change or any development involving a prospective
change not contemplated by the Prospectus as of the date of this
Agreement in or affecting particularly the business or properties of the
Company which, in the judgment of a majority in interest of the
Purchasers including you, materially impairs the investment quality of
the Purchased Notes, (ii) no rating of any of the Company's debt
securities shall have been lowered by any "nationally recognized
statistical rating organization," as that term is defined by the
Commission for purposes of Rule 436(g) and (iii) trading in securities
generally on the New York Stock Exchange shall not have been suspended
nor limited, other than a temporary suspension in trading to provide for
an orderly market, nor shall minimum prices have been established on
such Exchange, a banking moratorium shall not have been declared either
by New York State or Federal authorities and there shall not have
occurred an outbreak or escalation of major hostilities in which the
United States is involved or other substantial national or international
calamity or crisis (including one caused by a terrorist act), the effect
of which on the financial markets of the United States is such as to
make it, in your judgment, impracticable to market the Purchased Notes.
(d) There shall not be in effect on the Closing Date any order of
the Public Service Commission of
Maryland or Federal Energy Regulatory
Commission which would prevent the issuance, sale and delivery of the
Purchased Notes in accordance with the terms contemplated by this
Agreement.
(e) You shall have received an opinion, dated the Closing Date,
of a counsel for the Company to the effect that:
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the
State of
Maryland, with power and authority (corporate and other)
to own its properties and
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conduct its business as described in the Prospectus; and the
Company is duly qualified to do business as a foreign
corporation in good standing in all other jurisdictions in
which the conduct of its business or the ownership of its
properties requires such qualification and the failure to do
so would have a material and adverse impact on its financial
condition;
(ii) The Indenture has been duly authorized, executed and
delivered by the Company and is a valid instrument, legally
binding on the Company and enforceable in accordance with its
terms, except as limited by bankruptcy, insolvency, or other laws
affecting the enforcement of creditors' rights and by general
principles of equity;
(iii) The issuance and sale of the Purchased Notes have
been duly authorized by all necessary corporate action of the
Company. The Purchased Notes (assuming that they have been duly
authenticated by the Trustee or a duly designated Authentication
Agent under the Indenture, which fact counsel need not verify by
an inspection of the Purchased Notes), have been duly issued and
constitute legal, valid, and binding obligations of the Company
enforceable in accordance with their terms, and are entitled to
the benefits provided by the Indenture except as such
enforceability or entitlement may be limited by bankruptcy,
insolvency, or other laws affecting the enforcement of creditors'
rights and by general principles of equity;
(iv) The Registration Statement has become effective
under the Act and, (a) to the best of such counsel's knowledge,
no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose
have been instituted or are pending or contemplated under the
Act; (b) the Registration Statement (as of its effective date)
and the Prospectus (as of the date of the Closing Date) and any
amendments or supplements thereto, as of their respective dates,
appeared to comply as to form in all material respects with the
requirements of Form S-3 under the Act and the 33 Act Rules and
Regulations and the Trust Indenture Act; (c) such counsel has no
reason to believe that either the Registration Statement or the
Prospectus, or any such amendment or supplement, as of such
respective dates or as of the Closing Date, contained any untrue
statement of a material fact or omitted to state any material
fact required to be stated therein or necessary to make the
statement therein not misleading; (d) the descriptions in the
Registration Statement and Prospectus of statutes, legal and
governmental proceedings and contracts and other documents are
accurate and fairly present the information required to
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be shown; (e) and such counsel does not know of any legal or
governmental proceedings required to be described in the
Prospectus which are not described as required, or of any
contracts or documents of a character required to be described in
the Registration Statement or Prospectus or to be filed as
exhibits to the Registration Statement which are not described or
filed as required; it being understood that such counsel, in
addressing the matters covered in this paragraph (iv) need
express no opinion as to the financial statements or other
financial and statistical information contained in the
Registration Statement or the Prospectus or incorporated therein
or attached as an exhibit thereto or as to the Statement of
Eligibility and Qualification on Form T-l of the Trustee under
the Indenture.
(v) The approval of the Public Service Commission of
Maryland necessary for the valid issuance by the Company of the
Purchased Notes pursuant to this Agreement has been obtained and
continues in full force and effect. The Company has received the
approval of FERC for the issuance of Purchased Notes on or before
December 31, 2004 with maturities of not more than 12 months
after the date of issuance and the approval of FERC will be
required for the issuance of any Purchased Notes after December
31, 2004 and such counsel knows of no other approval of any other
regulatory authority which is legally required for the valid
offering, issuance, sale and delivery of the Purchased Notes by
the Company under this Agreement (except that such opinion need
not pass upon the requirements of state securities acts);
(vi) To the best of such counsel's knowledge and belief,
the consummation of the transactions contemplated in this
Agreement and the compliance by the Company with all the terms of
the Indenture did not and will not result in a breach of any of
the terms and provisions of, or constitute a default under, the
Company's Charter or By-Laws or any indenture, mortgage or deed
of trust or other agreement or instrument to which the Company is
a party;
(vii) Each of this Agreement and the Interest Calculation
Agency Agreement has been duly authorized, executed and delivered
by the Company;
(viii) The Indenture is duly qualified under the Trust
Indenture Act;
(ix) The issuance, sale and delivery of the Purchased
Notes as contemplated by this Agreement are not subject to the
approval of the Securities and Exchange Commission under the
provisions of the Public Utility Holding Company Act of 1935 (the
"1935 Act"); and
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(x) The statements set forth in the Prospectus under the
caption "Description of the Debt Securities," and on the cover
page of the Prospectus insofar as they purport to constitute a
summary of the terms of the Indenture and the Purchased Notes,
are accurate and fair summaries of the matters set forth therein.
(f) The Purchasers shall have received from Xxxxxx Xxxxxx &
Xxxxxxx, counsel for the Purchasers, an opinion dated the Closing Date, with
respect to the matters referred to in paragraph 6(e) subheadings (ii), (iii),
(iv)b, (v), (vii), (viii) and (x) and such other matters as the Purchasers shall
reasonably request and the Company shall have furnished to such counsel such
documents as they request for the purpose of enabling them to pass on such
matters.
In rendering such opinion, Xxxxxx Xxxxxx & Xxxxxxx may rely, as
to the incorporation of the Company, the approval of the Public Service
Commission of
Maryland required for the issuance, sale and delivery of the
Purchased Notes and all other matters governed by the laws of the State of
Maryland, the applicability of the 1935 Act, and FERC approval for the issuance,
sale and delivery of the Purchased Notes, upon the opinion of Counsel for the
Company referred to above.
In addition, such counsel shall state that such counsel has
participated in conferences with officers, counsel and other representatives of
the Company, representatives of the independent public accountants for the
Company and representatives of the Purchasers at which the contents of the
Registration Statement and the Prospectus and related matters were discussed;
and, although such counsel is not passing upon and does not assume
responsibility for the accuracy, completeness or fairness of the statements
contained in the Registration Statement and Prospectus (except as to the matters
referred to in their opinion rendered pursuant to subheading (x) above), on the
basis of the foregoing (relying as to materiality to a large extent upon the
opinions of officers, counsel and other representatives of the Company), no
facts have come to the attention of such counsel which lead such counsel to
believe that either the Registration Statement (as of its effective date) or the
Prospectus (as of the date of this Agreement), and any subsequent amendments or
supplements thereto, as of their respective dates, and as of the Closing Date,
contained an untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make such statements therein
not misleading (it being understood that such counsel need make no comment with
respect to the financial statements and other financial and statistical data
included in the Registration Statement or Prospectus or incorporated therein or
as to the Statement of Eligibility and Qualification on Form T-l of the Trustee
under the Indenture).
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(g) You shall have received a certificate of the Chairman of the
Board, President or any Vice President and a principal financial or
accounting officer of the Company, dated the Closing Date, in which such
officers shall state, to the best of their knowledge after reasonable
investigation, and relying on opinions of counsel to the extent that
legal matters are involved, that the representations and warranties of
the Company in this Agreement are true and correct in all material
respects, that the Company has complied with all agreements and
satisfied all conditions on its part to be performed or satisfied at or
prior to the Closing Date, that no stop order suspending the
effectiveness of the Registration Statement has been issued and no
proceedings for that purpose have been instituted or are contemplated by
the Commission, and that, subsequent to the date of the most recent
financial statements set forth or incorporated by reference in the
Prospectus, there has been no material adverse change in the financial
position or in the financial results of operation of the Company except
as set forth or contemplated in the Prospectus.
(h) The Company will furnish you with such conformed copies of
such opinions, certificates, letters and documents as you reasonably
request.
In case any such condition shall not have been satisfied, this
Agreement may be terminated by you upon notice in writing or by telecopy to the
Company without liability or obligation on the part of the Company or any
Purchaser, except as set forth in Section 10 hereof.
7. CONDITIONS OF THE OBLIGATIONS OF THE COMPANY. The obligations
of the Company to sell and deliver the Purchased Notes are subject to the
following conditions precedent:
(a) Prior to the Closing Date, no stop order suspending the
effectiveness of the Registration Statement shall have been issued and
no proceedings for that purpose shall have been instituted or, to the
knowledge of the Company or you, shall be contemplated by the
Commission.
(b) There shall not be in effect on the Closing Date any order of
the
Maryland Public Service Commission or Federal Energy Regulatory
Commission which would prevent the issuance, sale and delivery of the
Purchased Notes or which contains conditions or provisions with respect
thereto which are not acceptable to the Company, it being understood
that no order in effect at the date of this Agreement contains any such
unacceptable conditions or provisions.
If any such condition shall not have been satisfied, then the
Company shall be entitled, by notice in writing or by telecopy to you,
to terminate this Agreement without any
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liability on the part of the Company or any Purchaser, except as set
forth in Section 10 hereof.
8. INDEMNIFICATION.
(a) The Company will indemnify and hold harmless each Purchaser
and each person, if any, who controls any Purchaser within the meaning
of the Act or Exchange Act against any losses, claims, damages or
liabilities, joint or several, to which such Purchaser or such
controlling person 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 any untrue statement or
alleged untrue statement of any material fact contained in the
Registration Statement or the Prospectus (or any amendment or supplement
thereto), or any related preliminary prospectus 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 each Purchaser and each such
controlling person for any legal or other expenses reasonably incurred
by such Purchaser or such controlling person in connection with
investigating or defending any such loss, claim, damage, liability or
action; provided, however, that the Company will not be liable to such
Purchaser or controlling person 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 statement or omission or alleged
omission made in any such documents in reliance upon and in conformity
with written information furnished to the Company by such Purchaser or
such controlling person specifically for use therein; and provided,
further, that the Company shall not be liable to any Purchaser under the
indemnity agreement in this subsection (a) with respect to any
preliminary prospectus to the extent that any such loss, claim, damage
or liability of such Purchaser results from the fact such Purchaser sold
debt securities to a person to whom there was not sent or given, at or
prior to the written confirmation of such sale, a copy of the Prospectus
(excluding documents incorporated by reference) or of the Prospectus as
then amended or supplemented (excluding documents incorporated by
reference) in any case where such delivery is required by the Act if the
Company has previously furnished copies thereof to such Purchaser and
the loss, claim, damage or liability of such Purchaser results from an
untrue statement or omission of a material fact contained in the
preliminary prospectus which was corrected in the Prospectus (or the
Prospectus as amended or supplemented). This indemnity agreement will be
in addition to any liability which the Company may otherwise have.
(b) Each Purchaser will indemnify and hold harmless the Company,
each of its directors and officers and each person,
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if any, who controls the Company within the meaning of the Act or the
Exchange Act, against any losses, claims, damages or liabilities to
which the Company or any such director, officer or controlling person
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 any untrue statement or alleged untrue
statement of any material fact contained in the Registration Statement
or the Prospectus (or any amendment or supplement thereto), or any
related preliminary prospectus or arise out of or are based upon the
omission or the 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 reliance upon and in
conformity with written information furnished to the Company by such
Purchaser specifically for use therein; and will reimburse any legal or
other expenses reasonably incurred by the Company or any such director,
officer or controlling person in connection with investigating or
defending any such loss, claim, damage, liability or action as such
expenses are incurred. This indemnity agreement will be in addition to
any liability which such Purchaser may otherwise have.
(c) Promptly after receipt by an indemnified party under this
Section of notice of the commencement of any action, such indemnified
party will, if a claim in respect thereof is to be made against the
indemnifying party under (a) and (b) above, notify the indemnifying
party of the commencement thereof; but the omission so to notify the
indemnifying party will not relieve it from any liability which it may
have to any indemnified party otherwise than under this Section, except
to the extent the indemnifying party has been materially prejudiced by
such omission. In case any such action is brought against any
indemnified party, and it notifies the indemnifying party of the
commencement thereof, the indemnifying party will be entitled to
participate therein and, to the extent that it may wish, jointly with
any other indemnifying party similarly notified, to assume the defense
thereof, with counsel satisfactory to such indemnified party (who may,
with the consent of the indemnified party, be counsel to the
indemnifying party) and who shall not be counsel to any other
indemnified party who may have interests conflicting with those of such
indemnified party, and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party will not be liable to such indemnified party under
this Section for any legal or other expenses subsequently incurred by
such indemnified party in connection with the defense thereof other than
reasonable costs of investigation.
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(d) If recovery is not available under the foregoing
indemnification provisions of this Section, for any reason other than as
specified therein, the parties entitled to indemnification by the terms
thereof shall be entitled to contribution to liabilities and expenses,
except to the extent that contribution is not permitted under Section
11(f) of the Act. In determining the amount of contribution to which the
respective parties are entitled, there shall be considered the relative
benefits received by each party from the offering of the Purchased Notes
(taking into account the portion of the proceeds of the offering
realized by each), the parties' relative knowledge and access to
information concerning the matter with respect to which the claim was
asserted, the opportunity to correct and prevent any statement or
omission, and any other equitable considerations appropriate under the
circumstances. The Company and the Purchasers and such controlling
persons agree that it would not be equitable if the amount of such
contribution were determined by pro rata or per capita allocation (even
if the Purchasers and such controlling persons were treated as one
entity for such purpose). Notwithstanding the provisions of this
subsection (d), no Purchaser or controlling person shall be required to
make contribution hereunder which in the aggregate exceeds the total
public offering price of the Purchased Notes, purchased by the Purchaser
under this Agreement, less the aggregate amount of any damages which
such Purchaser or such controlling person has otherwise been required to
pay in respect of the same claim or any substantially similar claim. The
Purchasers' obligations to contribute are several in proportion to their
respective underwriting obligations and not joint.
9. DEFAULT OF PURCHASERS. If any Purchaser or Purchasers default
in their obligations to purchase Purchased Notes hereunder and the aggregate
principal amount of Purchased Notes which such defaulting Purchaser or
Purchasers agreed but failed to purchase is 10% of the principal amount of
Purchased Notes or less, the non-defaulting Purchasers may make arrangements
satisfactory to the Company for the purchase of such Purchased Notes by other
persons, including any of the Purchasers, but if no such arrangements are made
by the Closing Date the non-defaulting Purchasers shall be obligated severally,
in proportion to their respective commitments hereunder, to purchase the
Purchased Notes which such defaulting Purchasers agreed but failed to purchase.
If any Purchaser or Purchasers so default and the aggregate principal amount of
Purchased Notes with respect to which such default or defaults occur is more
than the above percentage
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and arrangements reasonably satisfactory to you and the Company for the
purchase of such Purchased Notes by other persons are not made within
seventy-two hours after such default, this Agreement will terminate without
liability on the part of any non-defaulting Purchaser or the Company, except
as provided in Section 10. In the event that any Purchaser or Purchasers
default in their obligation to purchase Purchased Notes hereunder, the
Company may, by prompt written notice to the non-defaulting Purchasers,
postpone the Closing Date for a period of not more than seven full business
days in order to effect whatever changes may thereby be made necessary in the
Registration Statement or the Prospectus or in any other documents, and the
Company will promptly file any amendments to the Registration Statement or
supplements to the Prospectus which may thereby be made necessary. As used in
this Agreement, the term "Purchaser" includes any person substituted for a
Purchaser under this Section. Nothing herein will relieve a defaulting
Purchaser from liability for its default.
10. SURVIVAL OF CERTAIN REPRESENTATIONS AND OBLIGATIONS. The
respective indemnities, agreements, representations, warranties, and other
statements of the Company or its officers and of the several Purchasers set
forth in or made pursuant to this Agreement will remain in full force and
effect, regardless of any investigation, or statement as to the results thereof,
made by or on behalf of any Purchaser or the Company or any of its officers or
directors or any controlling person, and will survive delivery of and payment
for the Purchased Notes. If this Agreement is terminated pursuant to Section 6,
7 or 9 or if for any reason the purchase of the Purchased Notes by the
Purchasers is not consummated, the Company shall remain responsible for the
expenses to be paid or reimbursed by it pursuant to Section 5(g). In addition,
in such event the respective obligations of the Company and the Purchasers
pursuant to Section 8 shall remain in effect; provided, however, that each
Purchaser will use its best efforts to promptly notify each other Purchaser and
each dealer and prospective customer to whom such Purchaser has delivered a
Prospectus for the Purchased Notes by telephone or telegraph, confirmed by
letter in either case, of such termination or failure to consummate, including
in such notice instructions regarding the continued use of the Registration
Statement, the Prospectus, or any amendment or supplement thereto, or any
related preliminary prospectus.
11. NOTICES. All communications hereunder will be in writing,
and, if sent to the Purchasers will be delivered or telecopied and confirmed to
the address furnished in writing for the purpose of such communications
hereunder, or, if sent to the Company, will be delivered or telecopied and
confirmed to it, attention of Treasurer at 000 X. Xxxxx Xxxxxx, 00xx Xxxxx,
Xxxxxxxxx, Xxxxxxxx 00000, telecopier (000) 000-0000.
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12. SUCCESSORS. This Purchase Agreement will inure to the benefit
of and be binding upon the parties hereto and their respective successors and
the officers and directors and controlling persons referred to in Section 8, and
no other person will have any right or obligation hereunder.
13. CONSTRUCTION. This Purchase Agreement shall be governed by
and construed in accordance with the laws of the State of
Maryland.
14. COUNTERPARTS. This Agreement may be executed in one or more
counterparts and it is not necessary that the signatures of all parties appear
on the same counterpart, but such counterparts together shall constitute but one
and the same agreement.
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