[DESCRIPTION] EXHIBIT 10-E
DEBT SECURITIES
UNDERWRITING AGREEMENT
PUBLIC SERVICE COMPANY OF NORTH CAROLINA,
INCORPORATED
X.X. Xxx 0000
Xxxxxxxx, Xxxxx Xxxxxxxx 00000-0000
[400 Xxx Xxxx, Xxxxxxxx, Xxxxx Xxxxxxxx 00000]
January 10, 1996
Ladies and Gentlemen:
We (the "Representative") are acting on behalf of the underwriter or
underwriters (including ourselves) named in Schedule I (the "Underwriters"),
and we understand that Public Service Company of North Carolina, Incorporated,
a North Carolina corporation (the "Company"), proposes to issue and sell to the
Underwriters $50,000,000 aggregate principal amount of its 6.99% Senior
Debentures due 2026 (the "Offered Securities"). The Offered Securities will
be issued pursuant to the provisions of the Indenture dated as of January 1,
1996 between the Company and First Union National Bank of North Carolina, as
trustee (the "Trustee"), as it will be supplemented by a supplemental indenture
relating to the Offered Securities (said Indenture, as so supplemented, the
"Indenture").
If Schedule I names one person, firm or corporation, the term
"Underwriters" and the term "Representative," as used in this agreement (this
"Agreement" or the "Underwriting Agreement"), shall mean that person, firm or
corporation. All obligations of the Underwriters are several and not joint.
The use of the term "Underwriter" herein shall not be deemed to establish or
admit that a purchaser of the Offered Securities is an "underwriter" of the
Offered Securities as such term is defined in and used under the Securities Act
of 1933, as amended (the "Securities Act").
1. Representations and Warranties. The Company represents and
warrants to and agrees with each of the Underwriters that:
(a) The Company has filed with the Securities and
Exchange Commission (the "Commission") a
registration statement on Form S-3 (Registration
Statement No. 33-65205), including a prospectus,
relating to the Offered Securities, and has filed
with, or transmitted for filing to, or shall
promptly hereafter file with or transmit for filing
to, the Commission a prospectus supplement (the
"Prospectus Supplement") specifically relating to
the Offered Securities pursuant to Rule 424 under
the Securities Act. The term "Registration
Statement" means the registration statement,
including the exhibits thereto, as amended to the
date of this Agreement. The term "Basic
Prospectus" means the prospectus included in the
Registration Statement, as amended and supplemented
to the date of this Agreement (exclusive of any
supplement to the prospectus relating solely to
securities other than the Offered Securities). The
term "Prospectus" means the Basic Prospectus
together with the Prospectus Supplement. The term
"preliminary prospectus" means a preliminary
prospectus supplement specifically relating to the
Offered Securities, together with the Basic
Prospectus. As used herein, the terms "Basic
Prospectus," "Prospectus" and "preliminary
prospectus" shall include in each case the
documents, if any, incorporated by reference
therein. The terms "supplement", "amendment" and
"amend" as used herein shall include all documents
deemed to be incorporated by reference in the
Prospectus that are filed subsequent to the date of
the Basic Prospectus by the Company with the
Commission pursuant to the Securities Exchange Act
of 1934, as amended (the "Exchange Act").
(b) The Registration Statement has become
effective; no stop order suspending the
effectiveness of the Registration Statement is in
effect, and no proceedings for such purpose are
pending before or threatened by the Commission.
(c) (i) Each document, if any, filed or to be
filed pursuant to the Exchange Act and
incorporated by reference in the Prospectus
complied or will comply when so filed in all
material respects with the Exchange Act and
the applicable rules and regulations of the
Commission thereunder or pursuant to said
rules and regulations will be deemed to comply
therewith; (ii) each part of the Registration
Statement, when such part became effective,
did not contain, and each such part, as
amended or supplemented, if applicable, will
not contain any untrue statement of a material
fact or omit to state a material fact required
to be stated therein or necessary to make the
statements therein not misleading; (iii) the
Registration Statement, when it became
effective, complied and the Prospectus, when
it is first filed with the Commission pursuant
to Rule 424 and when it is amended or
supplemented, if applicable, will comply in
all material respects with the Securities Act
and the applicable rules and regulations of
the Commission thereunder or pursuant to said
rules and regulations will be deemed to comply
therewith; and (iv) the Prospectus does not,
and when it is first filed with the Commission
pursuant to Rule 424 under the Securities Act
and, as amended or supplemented, if
applicable, as of the Closing Date, will not,
contain any untrue statement of a material
fact or omit to state a material fact
necessary to make the statements therein, in
the light of the circumstances under which
they were made, not misleading, except that
the representations and warranties set forth
in this Section 1(c) do not apply (A) to
statements or omissions in the Registration
Statement or the Prospectus based upon
information relating to any Underwriter
furnished to the Company in writing by such
Underwriter expressly for use therein or (B)
to that part of the Registration Statement
that constitutes the Statement of Eligibility
(Form T-l) under the Trust Indenture Act of
1939, as amended (the "Trust Indenture Act"),
of the Trustee.
(d) The Company has been duly incorporated, is
validly existing as a corporation in good standing
under the laws of the State of North Carolina, has
the corporate power and authority to own its
property and to conduct its business as described
in the Prospectus and to enter into and perform its
obligations under the Underwriting Agreement, the
Indenture and the Offered Securities. The Company
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 the Company and its subsidiaries,
taken as a whole.
(e) Each subsidiary of the Company has been duly
incorporated, is validly existing as a corporation
in good standing under the laws of the jurisdiction
of its incorporation, has the corporate power and
authority 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 the Company and its subsidiaries, taken
as a whole.
(f) The Indenture has been duly qualified under
the Trust Indenture Act and has been duly
authorized, executed and delivered by the Company
and is a valid and binding agreement of the
Company, enforceable in accordance with its terms,
except as the enforceability thereof may be limited
by bankruptcy, insolvency, reorganization,
moratorium, fraudulent conveyance or other laws
affecting creditors' rights generally and by
equitable principles of general applicability
(whether considered in a proceeding at law or in
equity).
(g) The Offered Securities have been duly
authorized and, when executed and
authenticated in accordance with the
provisions of the Indenture and delivered to
and paid for by the Underwriters in accordance
with the terms of the Underwriting Agreement,
will be entitled to the benefits of the
Indenture, and will be valid and binding
obligations of the Company, enforceable in
accordance with their terms, except as the
enforceability thereof may be limited by
bankruptcy, insolvency, reorganization,
moratorium, fraudulent conveyance or other
laws affecting creditors' rights generally and
by equitable principles of general
applicability (whether considered in a
proceeding at law or in equity).
(h) This Agreement has been duly authorized,
executed and delivered by the Company.
(i) The execution and delivery by the Company of,
and the performance by the Company of its
obligations under, the Underwriting Agreement, the
Indenture and the Offered Securities will not
contravene, conflict with, result in a breach of or
constitute a default under any provision of (A)
applicable law, (B) the amended and restated
charter or the by-laws of the Company, (C) any
indenture, mortgage, deed of trust or other
agreement or instrument to which the Company or any
of its subsidiaries is a party that is material to
the Company and its subsidiaries, taken as a whole
or (D) any judgment, order or decree of any
governmental body, agency or court applicable to
the Company or any subsidiary.
(j) The North Carolina Utilities Commission (the
"NCUC") has issued an appropriate order or orders
with respect to the issuance and sale of the
Offered Securities in accordance with the
Underwriting Agreement; such order or orders are in
full force and effect; the issuance and sale of the
Offered Securities are in conformity with the terms
of such order or orders; and no other
authorization, approval or consent of any other
governmental body or agency is legally required for
the issuance and sale of the Offered Securities as
contemplated by the Underwriting Agreement, except
as may be required under the state securities or
Blue Sky laws in connection with the purchase and
distribution of the Offered Securities by the
Underwriters.
(k) There has not occurred any material adverse
change, or any development involving a prospective
material adverse change, in the condition,
financial or otherwise, or in the earnings,
business or operations of the Company and its
subsidiaries, taken as a whole, from that set forth
in the Prospectus.
(l) All legal or governmental proceedings
pending or threatened to which the Company or
any of its subsidiaries is a party or to which
any of the properties of the Company or any of
its subsidiaries is subject that are required
to be described in the Registration Statement
or the Prospectus are so described, and all
statutes, regulations, contracts or other
documents that are required to be described in
the Registration Statement or the Prospectus,
or to be filed or incorporated by reference as
exhibits to the Registration Statement, are
described, filed or incorporated as required.
(m) The Company is not an "investment
company" or an entity "controlled" by an
"investment company," as such terms are
defined in the Investment Company Act of
1940, as amended (the "Investment Company
Act") and is not a "holding company," as such
term is defined in the Public Utility Holding
Company Act of 1935, as amended ("PUHCA").
(n) The Company and its subsidiaries are (i)
in compliance with any and all applicable
foreign, federal, state and local laws and
regulations relating to the protection of
human health and safety, the environment or
hazardous or toxic substances or water,
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 the Company and its
subsidiaries, taken as a whole.
(o) In the ordinary course of its business, the
Company conducts a periodic review of the effect of
Environmental Laws on the business, operations and
properties of the Company and its subsidiaries, in
the course of which it identifies and evaluates
associated costs and liabilities (including,
without limitation, any capital or operating
expenditures required for clean-up, closure of
properties or compliance with Environmental Laws or
any permit, license or approval, any related
constraints on operating activities and any
potential liabilities to third parties). On the
basis of such review, the Company has reasonably
concluded that such associated costs and
liabilities would not, singly or in the aggregate,
have a material adverse effect on the Company and
its subsidiaries, taken as a whole.
(p) The Company has complied with all
provisions of Section 517.075, Florida
Statutes (Chapter 92-198, Laws of Florida).
(q) Except as disclosed in Schedule III, as of the date hereof, there
are no Liens (as defined in the Indenture) on any property or assets of the
Company or its subsidiaries.
2. Public Offering. The Company is advised by the Representative
that the Underwriters propose to make a public offering of their
respective portions of the Offered Securities as soon after the
Underwriting Agreement has been entered into as in the
Representative's judgment is advisable. The terms of the public
offering of the Offered Securities are set forth in the
Prospectus.
3. Purchase and Delivery. Subject to the terms and conditions
herein set forth, the Company hereby agrees to sell and the
Underwriters agree to purchase, severally and not jointly, the
respective principal amounts of Offered Securities set forth
opposite the name of such Underwriter in Schedule I hereto at the
purchase price set forth in Schedule II in the type of funds and
method of payment specified in Schedule II.
Delivery of the Offered Securities and payment of the purchase price
shall be made at the time, date and place indicated in Schedule II. The time
and date of such payment and delivery are hereinafter referred to as the
Closing Date.
The Offered Securities shall be delivered to the Underwriters in such
authorized denominations and registered in such names as the Representative
shall request in writing not less than one full business day prior to the date
of delivery. The Company agrees to make the Offered Securities available to
the Underwriters for checking not later than 2:30 P.M., New York time, on the
last business day preceding the Closing Date at such place as may be agreed
upon between the Representative and the Company.
4. Conditions to Closing. The several obligations of the
Underwriters hereunder are subject to the following conditions:
(a) Subsequent to the execution and delivery of
the Underwriting Agreement and prior to the Closing
Date,
(i) no downgrading shall have occurred and no notice shall have
been given of any intended or potential downgrading or of any review for a
possible change that does not indicate the direction of a possible change,
in the rating accorded any of the Company's securities by any "nationally
recognized statistical rating organization," as such term is defined for
purposes of Rule 436(g)(2) under the Securities Act;
(ii) no change, and no development involving a prospective change,
shall have occurred in the condition, financial or otherwise, or in the
earnings, business or operations, of the Company and its subsidiaries, taken
as a whole, from that set forth in the Prospectus, that, in the judgment of
Xxxxxx Xxxxxxx & Co. Incorporated, is material and adverse and that makes
it, in the judgment of Xxxxxx Xxxxxxx & Co. Incorporated, impracticable to
market the Offered Securities on the terms and in the manner contemplated in
the Prospectus; and
(iii) the Company shall have obtained an appropriate order or orders
of the NCUC authorizing the issuance, sale and delivery of the Offered
Securities as contemplated by this Agreement, which order or orders at the
Closing Date shall be in full force and effect and shall not be contested or
the subject of review or appeal.
(b) The Underwriters shall have received on the
Closing Date a certificate, dated the Closing Date
and signed by an executive officer of the Company
to the effect set forth in clause (a)(i) and (iii)
above and that the representations and warranties
of the Company contained in this Agreement are true
and correct as of the Closing Date and that the
Company has complied with all of the agreements and
satisfied all of the conditions on its part to be
performed or satisfied on or before the Closing
Date.
(c) The Representative shall have received on the Closing Date an
opinion dated the Closing Date of Fennebresque, Clark, Xxxxxxxx & Hay, counsel
to the Company, to the effect that
(i) the Company has been duly incorporated, is validly
existing as a corporation in good standing under the
laws of the State of North Carolina, has the corporate
power and authority to own its property and to conduct
its business as described in the Prospectus and is duly
qualified and 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 the Company and its subsidiaries, taken as a
whole;
(ii) this Agreement has been duly authorized, executed and
delivered by the Company;
(iii) the Indenture has been duly qualified under the Trust
Indenture Act and has been duly authorized, executed and delivered by the
Company and is a valid and binding agreement of the Company, enforceable in
accordance with its terms, except as limited by bankruptcy, insolvency,
reorganization, moratorium, fraudulent conveyance or other laws affecting the
enforcement of creditors' rights generally and by general equitable
principles (whether considered in a proceeding at law or in equity);
(iv) the Offered Securities have been duly authorized and, when
executed and authenticated in accordance with the provisions of the Indenture
and delivered to and paid for by the Underwriters in accordance with the
terms of the Underwriting Agreement, will be entitled to the benefits of the
Indenture and will be valid and binding obligations of the Company, in each
case enforceable in accordance with their respective terms, except as limited
by bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance
or other laws affecting the enforcement of creditors' rights generally and
by general equitable principles (whether considered in a proceeding at law
or in equity);
(v) the execution and delivery by the Company of, and the
performance by the Company of its obligations under, the Underwriting
Agreement, the Indenture and the Offered Securities will not contravene,
conflict with, result in a breach of or constitute a default under any
provision of (A) applicable law (assuming compliance with all applicable
state securities or Blue Sky laws), (B) the amended and restated charter or
the by-laws of the Company, (C) to the best of such counsel's knowledge after
due inquiry, any indenture, mortgage, deed of trust or other agreement or
instrument to which the Company or any of its subsidiaries is a party that
is material to the Company and its subsidiaries, taken as a whole or (D) to
the best of such counsel's knowledge after due inquiry, any judgment, order
or decree of any governmental body, agency or court applicable to the Company
or any subsidiary;
(vi) the NCUC has issued an appropriate order or orders with
respect to the issuance and sale of the Offered Securities in accordance with
the Underwriting Agreement; such order or orders are in full force and effect
and are sufficient to authorize such issuance and sale as contemplated by the
Agreement; the issuance and sale of the Offered Securities are in conformity
with the terms of such order or orders; no challenge to or appeal of such
order or orders after the date of issuance of the Offered Securities can
affect the validity of the Offered Securities; and no other authorization,
approval or consent of any other governmental body or agency is legally
required for the issuance and sale of the Offered Securities as contemplated
by the Underwriting Agreement, except (A) as may be required under the state
securities or Blue Sky laws in connection with the purchase and distribution
of the Offered Securities by the Underwriters, (B) registration of the
Offered Securities under the Securities Act and (C) as may be required by any
securities exchange on which the Offered Securities may be listed;
(vii) the statements in the Prospectus under the captions
"Description of Debentures," "Description of Debt Securities," "Underwriting"
and "Plan of Distribution," in each case insofar as such statements
constitute summaries of the legal matters, documents or proceedings referred
to therein, fairly present the information called for with respect to such
legal matters, documents and proceedings and fairly summarize the matters
referred to therein;
(viii) to the best of such counsel's knowledge after due inquiry,
such counsel does not know of any statutes, regulations, contracts or other
documents that are required to be described in the Registration Statement or
the Prospectus or to be filed or incorporated by reference as exhibits to the
Registration Statement that are not described, filed or incorporated as
required;
(ix) the Company is not (A) an "investment company" or an entity
"controlled" by an "investment company," as such terms are defined in the
Investment Company Act or (B) a "holding company," as such term is defined
in PUHCA;
(x) the Registration Statement has become and is effective under
the Securities Act, and, 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 a stop order with respect thereto are pending
or threatened under Section 8(d) of the Securities Act; and
(xi) such counsel (A) is of the opinion that (except for financial
statements and schedules and other financial and statistical data contained
or incorporated by reference therein, as to which such counsel need not
express any opinion) each document, if any, filed pursuant to the Exchange
Act and incorporated by reference in the Prospectus complied when so filed
as to form in all material respects with the Exchange Act and the applicable
rules and regulations of the Commission thereunder, (B) believes that (except
for financial statements and schedules and other financial and statistical
data contained or incorporated by reference therein, as to which such counsel
need not express any belief and except for that part of the Registration
Statement that constitutes the Form T-l heretofore referred to) each part of
the Registration Statement, when such part became effective did not, and, as
of the date such opinion is delivered, does not contain any 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, (C) is
of the opinion that the Registration Statement, when it became effective, and
the Prospectus, when it was first filed with the Commission pursuant to Rule
424 under the Securities Act (in each case, except for financial statements
and schedules and other financial and statistical data included or
incorporated by reference therein, as to which such counsel need not express
any opinion), complied as to form in all material respects with the
Securities Act and the applicable rules and regulations of the Commission
thereunder and (D) believes that (except for financial statements and
schedules and other financial or statistical data contained or incorporated
by reference therein, as to which such counsel need not express any belief)
the Prospectus, when it was first filed with the Commission pursuant to Rule
424 under the Securities Act, did not and as of the date such opinion is
delivered, does 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 the light of the circumstances under which they were made, not misleading.
As to matters of New York law, Fennebresque, Clark, Xxxxxxxx & Hay may
rely upon the opinion of even date herewith of Winthrop, Stimson, Xxxxxx &
Xxxxxxx. For purposes of clause (A) of paragraph (v), paragraph (vi) and
paragraph (viii), as to matters of North Carolina law relating to the
regulation of public utilities, Fennebresque, Clark, Xxxxxxxx & Hay may rely
upon the opinion of even date herewith of J. Xxxx Xxxxxxx, Esq.
(d) The Representative shall have received on the Closing Date an
opinion dated the Closing Date of J. Xxxx Xxxxxxx, Esq., Vice-President--
Corporate Counsel and Secretary of the Company,
(i) to the effect that each subsidiary of the Company has been duly
incorporated, is validly existing as a corporation in good standing under the
laws of the jurisdiction of its incorporation, has the corporate power and
authority 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 the Company and its subsidiaries, taken as a whole;
(ii) to the effect that to the best of such counsel's knowledge after
due inquiry, such counsel does not know of any legal or governmental
proceedings pending or threatened to which the Company or any of its
subsidiaries is a party or to which any of the properties of the Company or any
of its subsidiaries is subject that are required to be described in the
Registration Statement or the Prospectus and are not so described;
(iii) to the effect that the statements (A) in the Registration
Statement under Item 15, (B) in "Item 3 - Legal Proceedings" of the Company's
most recent annual report on Form 10-K incorporated by reference in the
Prospectus and (C) in "Item 1 - Legal Proceedings" of Part II of the Company's
quarterly reports on Form 10-Q filed since such annual report, in each case
insofar as such statements constitute summaries of the legal matters, documents
or proceedings referred to therein, fairly present the information called for
with respect to such legal matters, documents and proceedings and fairly
summarize the matters referred to therein; and
(iv) covering the matters referred to in subparagraphs (v)(but only as
to the matters referred to in clause (A) thereof), (vi) and (viii) of paragraph
(c) above.
(e) The Representative shall have received on the Closing Date an
opinion dated the Closing Date of Winthrop, Stimson, Xxxxxx & Xxxxxxx, counsel
for the Underwriters, covering the matters referred to in subparagraphs (ii),
(iv), (vii), (x) and (xi) (but only as to the matters referred to in clauses
(B), (C) and (D) thereof) of paragraph (c) above.
As to matters of North Carolina law, Winthrop, Stimson, Xxxxxx & Xxxxxxx
may rely upon the opinions of even date herewith of Fennebresque, Clark,
Xxxxxxxx & Hay and J. Xxxx Xxxxxxx.
With respect to the subparagraph (xi) of paragraph (c) above,
Fennebresque, Clark, Xxxxxxxx & Hay, counsel to the Company, may state that
their opinion and belief are based upon their participation in the preparation
of the Registration Statement and Prospectus and any amendments or supplements
thereto and review and discussion of the contents thereof (including the
documents incorporated by reference therein), but are without independent check
or verification, except as specified. With respect to clauses (B), (C) and (D)
of subparagraph (xi) of paragraph (c) above, Winthrop, Stimson, Xxxxxx &
Xxxxxxx may state that their opinion and belief are based upon their
participation in the preparation of the Registration Statement and Prospectus
and any amendments or supplements thereto (but not including documents
incorporated therein by reference) and review and discussion of the contents
thereof (including documents incorporated therein by reference) but are without
independent check or verification, except as specified.
The opinions of Fennebresque, Clark, Xxxxxxxx & Hay, counsel to the
Company, described in paragraph (c) above and of J. Xxxx Xxxxxxx, Esq., Vice-
President--Corporate Counsel and Secretary, described in paragraph (d) above,
shall be rendered to the Representative at the request of the Company and shall
so state therein.
(f) The Representative shall have received on the date of this
Agreement a letter, dated the date of this Agreement, in form and substance
satisfactory to the Representative, from Xxxxxx Xxxxxxxx LLP, the Company's
independent public accountants, containing statements and information of the
type ordinarily included in accountants' "comfort letters" to underwriters with
respect to the financial statements and certain financial information contained
in or incorporated by reference into the Prospectus.
(g) The Representative shall have received on the Closing Date a
letter, dated the Closing Date, in form and substance satisfactory to the
Representative, from Xxxxxx Xxxxxxxx LLP, the Company's independent public
accountants, to the effect that such accountants reaffirm, as of the Closing
Date, and as though made on the Closing Date, the statements made in the letter
furnished by such accountants pursuant to Section 4(e), except that the
specified date referred to therein shall be a date not more than five business
days prior to the Closing Date.
(h) On the Closing Date, Standard & Poor's Ratings Group and Xxxxx'x
Investors Service, Inc. shall have publicly assigned to the Offered Securities
ratings of A- and A2, respectively, which ratings shall be in full force and
effect on the Closing Date.
(i) The Representative shall have received on the Closing Date (i)
satisfactory evidence of the satisfaction and discharge of the Company's First
Mortgage dated as of January 1, 1952 (as heretofore amended and supplemented,
the "First Mortgage") or (ii) executed copies of such deeds of release, if on
the Closing Date such satisfaction and discharge is subject only to the filing
and recording of deeds of release in one or more jurisdictions; provided that,
in the case of clause (ii), the Company hereby agrees promptly (and in no case
later than 20 business days following the Closing Date) (x) to file and record,
or cause to be filed and recorded, such deeds of release in the appropriate
jurisdictions, and to take all other actions necessary or appropriate in order
to cause the satisfaction and discharge of the First Mortgage and (y) to
deliver or cause to be delivered to the Representative an opinion of counsel
to the effect that the First Mortgage has been satisfied and discharged.
5. Covenants of the Company. In further consideration of the
agreements of the Underwriters herein contained, the Company
covenants as follows:
(a) To furnish the Representative, without charge,
a signed copy of the Registration Statement
(including exhibits thereto) and to deliver to each
other Underwriter a conformed copy of the
Registration Statement (without exhibits thereto)
and, during the period mentioned in paragraph (c)
below, as many copies of the Prospectus, any
documents incorporated by reference therein and any
supplements and amendments thereto or to the
Registration Statement as the Underwriters may
reasonably request.
(b) To cause the Prospectus to be filed with the
Commission pursuant to and in compliance with Rule
424 under the Act.
(c) Before amending or supplementing the
Registration Statement or the Prospectus, to
furnish to the Representative a copy of each
such proposed amendment or supplement and not
to file any such proposed amendment or
supplement to which the Representative
reasonably objects.
(d) If, during such period after the first date of
the public offering of the Offered Securities as in
the opinion of counsel for the Underwriters the
Prospectus is required by law to be delivered in
connection with sales by an Underwriter or dealer,
any event shall occur or condition exist as a
result of which it is necessary to amend or
supplement the Prospectus in order to make the
statements therein, in the light of the
circumstances when the Prospectus is delivered to
a purchaser, not misleading, or if, in the opinion
of counsel for the Underwriters, it is necessary to
amend or supplement the Prospectus to comply with
law, forthwith to prepare, file with the Commission
and furnish, at its own expense, to the
Underwriters, and to the dealers (whose names and
addresses the Representative will furnish to the
Company) to which Offered Securities may have been
sold by the Representative on behalf of the
Underwriters and to any other dealers upon request,
either amendments or supplements to the Prospectus
so that the statements in the Prospectus as so
amended or supplemented will not, in the light of
the circumstances when the Prospectus is delivered
to a purchaser, be misleading or so that the
Prospectus, as amended or supplemented, will comply
with law.
(e) To endeavor to qualify the Offered Securities
for offer and sale under the securities or Blue Sky
laws of such jurisdictions as the Representative
shall reasonably request and to maintain such
qualification for as long as the Representative
shall reasonably request.
(f) To make generally available to the Company's
security holders and to the Representative as soon
as practicable an earning statement covering a
twelve month period beginning on the first day of
the first full fiscal quarter after the date of the
Underwriting Agreement, which earning statement
shall satisfy the provisions of Section 11(a) of
the Securities Act and the rules and regulations of
the Commission thereunder. If such fiscal quarter
is the last fiscal quarter of the Company's fiscal
year, such earning statement shall be made
available not later than 90 days after the close of
the period covered thereby and in all other cases
shall be made available not later than 45 days
after the close of the period covered thereby.
(g) During the period beginning on the date
of this Agreement and continuing to and
including the Closing Date, without the prior
written consent of Xxxxxx Xxxxxxx & Co.
Incorporated, not to (1) offer, pledge, sell,
contract to sell, sell any option or contract
to purchase, purchase any option or contract
to sell, grant any option, right or warrant to
purchase, or otherwise transfer or dispose of,
directly or indirectly, any debt securities of
the Company or warrants to purchase debt
securities of the Company substantially
similar to the Offered Securities or any
securities convertible into or exercisable or
exchangeable therefor (other than (i) the
Offered Securities, (ii) commercial paper
issued in the ordinary course of business and
(iii) other debt securities evidencing
commercial bank loans) or (2) enter into any
swap or similar arrangement that transfers, in
whole or part, the economic risk of ownership
of any of the foregoing, whether any such
transaction described in clause (1) or (2)
above is to be settled by delivery of the
Offered Securities or such other securities,
in cash or otherwise.
(h) Whether or not any sale of the Offered
Securities is consummated, to pay all expenses
incident to the performance of its obligations
under the Underwriting Agreement, including:
(i) the preparation and filing of the
Registration Statement and the Prospectus and
all amendments and supplements thereto, (ii)
the preparation, issuance and delivery of the
Offered Securities, (iii) the fees and
disbursements of the Company's counsel and
accountants and of the Trustee and its
counsel, (iv) the qualification of the Offered
Securities under securities or Blue Sky laws
in accordance with the provisions of Section
5(e), including filing fees and the fees and
disbursements of counsel for the Underwriters
in connection therewith and in connection with
the preparation of any Blue Sky Memoranda, (v)
the printing and delivery to the Underwriters
in quantities as hereinabove stated of copies
of the Registration Statement and all
amendments thereto and of the Prospectus and
any amendments or supplements thereto, (vi)
any fees charged by rating agencies for the
rating of the Offered Securities, (vii) the
fees and expenses, if any, incurred with
respect to any filing with the National
Association of Securities Dealers, Inc. and
(viii) all document production charges and
expenses of counsel to the Underwriters (but
not including their fees for professional
services) in connection with the preparation
of this Agreement.
6. Indemnification and Contribution. (a) The Company agrees to
indemnify and hold harmless each Underwriter and each person, if
any, who controls such Underwriter within the meaning of either
Section 15 of the Securities Act or Section 20 of the Exchange Act
from and against any and all losses, claims, damages and
liabilities (including, without limitation, any legal or other
expenses reasonably incurred by any Underwriter or any such
controlling person in connection with investigating or defending
any such action or claim) caused by any untrue statement or
alleged untrue statement of a material fact contained in the
Registration Statement or any amendment thereof, any preliminary
prospectus or the Prospectus (as amended or supplemented if the
Company shall have furnished any amendments or supplements
thereto), or caused by any omission or alleged omission to state
therein a material fact required to be stated therein or necessary
to make the statements therein not misleading, except insofar as
such losses, claims, damages or liabilities are caused by any such
untrue statement or omission or alleged untrue statement or
omission based upon information relating to any Underwriter
furnished to the Company in writing by such Underwriter through
the Representative expressly for use therein.
(b) Each Underwriter agrees, severally and not
jointly, to indemnify and hold harmless the
Company, its directors, its officers who sign the
Registration Statement and each person, if any, who
controls the Company within the meaning of either
Section 15 of the Securities Act or Section 20 of
the Exchange Act to the same extent as the
foregoing indemnity from the Company to such
Underwriter, but only with reference to information
relating to such Underwriter furnished to the
Company in writing by such Underwriter through the
Representative expressly for use in the
Registration Statement, any preliminary prospectus,
the Prospectus or any amendments or supplements
thereto.
(c) In case any proceeding (including any
governmental investigation) shall be instituted
involving any person in respect of which indemnity
may be sought pursuant to either paragraph (a) or
(b) above, such person (the "indemnified party")
shall promptly notify the person against whom such
indemnity may be sought (the "indemnifying party")
in writing and the indemnifying party, upon request
of the indemnified party, shall retain counsel
reasonably satisfactory to the indemnified party to
represent the indemnified party and any others the
indemnifying party may designate in such proceeding
and shall pay the fees and disbursements of such
counsel related to such proceeding. In any such
proceeding, any indemnified party shall have the
right to retain its own counsel, but the fees and
expenses of such counsel shall be at the expense of
such indemnified party unless (i) the indemnifying
party and the indemnified party shall have mutually
agreed to the retention of such counsel or (ii) the
named parties to any such proceeding (including any
impleaded parties) include both the indemnifying
party and the indemnified party and representation
of both parties by the same counsel would be
inappropriate due to actual or potential differing
interests between them. It is understood that the
indemnifying party shall not, in respect of the
legal expenses of any indemnified party in
connection with any proceeding or related
proceedings in the same jurisdiction, be liable for
the fees and expenses of more than one separate
firm (in addition to any local counsel) for all
such indemnified parties and that all such fees and
expenses shall be reimbursed as they are incurred.
Such firm shall be designated in writing by the
Representative, in the case of parties indemnified
pursuant to paragraph (a) above, and by the
Company, in the case of parties indemnified
pursuant to paragraph (b) above. The indemnifying
party shall not be liable for any settlement of any
proceeding effected without its written consent,
but if settled with such consent or if there be a
final judgment for the plaintiff, the indemnifying
party agrees to indemnify the indemnified party
from and against any loss or liability by reason of
such settlement or judgment. Notwithstanding the
foregoing sentence, if at any time an indemnified
party shall have requested an indemnifying party to
reimburse the indemnified party for fees and
expenses of counsel as contemplated by the second
and third sentences of this paragraph, the
indemnifying party agrees that it shall be liable
for any settlement of any proceeding effected
without its written consent if (i) such settlement
is entered into more than 30 days after receipt by
such indemnifying party of the aforesaid request
and (ii) such indemnifying party shall not have
reimbursed the indemnified party in accordance with
such request prior to the date of such settlement.
No indemnifying party shall, without the prior
written consent of the indemnified party, effect
any settlement of any pending or threatened
proceeding in respect of which any indemnified
party is or could have been a party and indemnity
could have been sought hereunder by such
indemnified party, unless such settlement includes
an unconditional release of such indemnified party
from all liability on claims that are the subject
matter of such proceeding.
(d) To the extent the indemnification
provided for in paragraph (a) or (b) of this
Section 6 is unavailable to an indemnified
party or insufficient in respect of any
losses, claims, damages or liabilities
referred to therein, then each indemnifying
party under such paragraph, in lieu of
indemnifying such indemnified party
thereunder, shall contribute to the amount
paid or payable by such indemnified party as
a result of such losses, claims, damages or
liabilities (i) in such proportion as is
appropriate to reflect the relative benefits
received by the Company on the one hand and
the Underwriters on the other hand from the
offering of the Offered Securities or (ii) if
the allocation provided by clause (i) above is
not permitted by applicable law, in such
proportion as is appropriate to reflect not
only the relative benefits referred to in
clause (i) above but also the relative fault
of the Company on the one hand and of the
Underwriters on the other hand in connection
with the statements or omissions that resulted
in such losses, claims, damages or
liabilities, as well as any other relevant
equitable considerations. The relative
benefits received by the Company on the one
hand and the Underwriters on the other hand in
connection with the offering of the Offered
Securities shall be deemed to be in the same
respective proportions as the net proceeds
from the offering of such Offered Securities
(before deducting expenses) received by the
Company and the total underwriting discounts
and commissions received by the Underwriters,
in each case as set forth in the table on the
cover of the Prospectus Supplement, bear to
the aggregate public offering price of the
Offered Securities. The relative fault of the
Company on the one hand and of the
Underwriters on the other hand 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 the Company
or by the Underwriters and the parties'
relative intent, knowledge, access to
information and opportunity to correct or
prevent such statement or omission. The
Underwriters' respective obligations to
contribute pursuant to this Section 6 are
several in proportion to the respective
principal amounts of the Offered Securities
they have purchased hereunder, and not joint.
(e) The Company and the Underwriters agree that it
would not be just or equitable if contribution
pursuant to this Section 6 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 that does not take
account of the equitable considerations referred to
in paragraph (d) above. The amount paid or payable
by an indemnified party as a result of the losses,
claims, damages and liabilities referred to in the
immediately preceding paragraph shall be deemed to
include, subject to the limitations set forth
above, 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
Section 6, no Underwriter shall be required to
contribute any amount in excess of the amount by
which the total price at which the Offered
Securities underwritten by it and distributed to
the public were offered to the public exceeds the
amount of any damages that 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 Securities Act) shall be entitled to
contribution from any person who was not guilty of
such fraudulent misrepresentation. The remedies
provided for in this Section 6 are not exclusive
and shall not limit any rights or remedies which
may otherwise be available to any indemnified party
at law or in equity.
7. Termination. This Agreement shall be subject to termination,
by notice given by the Representative to the Company, if (a) after
the execution and delivery of the Underwriting Agreement and prior
to the Closing Date (i) trading generally shall have been
suspended or materially limited on or by, as the case may be, any
of the New York Stock Exchange, the American Stock Exchange, the
National Association of Securities Dealers, Inc., the Nasdaq
National Market, the Chicago Board of Options Exchange, the
Chicago Mercantile Exchange or the Chicago Board of Trade, (ii)
trading of any securities of the Company shall have been suspended
on any exchange or in any over-the-counter market, (iii) a general
moratorium on commercial banking activities in New York shall have
been declared by either Federal or New York State authorities or
(iv) there shall have occurred any outbreak or escalation of
hostilities or any change in financial markets or any calamity or
crisis that, in the judgment of Xxxxxx Xxxxxxx & Co. Incorporated,
is material and adverse and (b) in the case of any of the events
specified in clauses (a)(i) through (iv), such event, singly or
together with any other such event, makes it, in the judgment of
Xxxxxx Xxxxxxx & Co. Incorporated, impracticable to market the
Offered Securities on the terms and in the manner contemplated in
the Prospectus. This Agreement may also be terminated at any time
prior to the Closing Date if in the judgment of Xxxxxx Xxxxxxx &
Co. Incorporated the subject matter of any amendment or supplement
to the Registration Statement or Prospectus prepared and furnished
by the Company reflects a material adverse change in the business,
properties or financial condition of the Company which renders it
either inadvisable to proceed with such offering, if any, or
inadvisable to proceed with the delivery of the Offered Securities
to be purchased hereunder.
8. Defaulting Underwriters. If, on the Closing Date, any
one or more of the Underwriters shall fail or refuse to
purchase the Offered Securities that it has or they have
agreed to purchase hereunder on such date, and the aggregate
amount of Offered Securities which such defaulting
Underwriter or Underwriters agreed but failed or refused to
purchase is not more than one-tenth of the aggregate amount
of the Offered Securities to be purchased on such date, the
other Underwriters shall be obligated severally in the
proportions that the amount of Offered Securities set forth
opposite their respective names in the Underwriting Agreement
bears to the aggregate amount of the Offered Securities set
forth opposite the names of all such non-defaulting
Underwriters, or in such other proportions as the
Representative may specify, to purchase the Offered
Securities which such defaulting Underwriter or Underwriters
agreed but failed or refused to purchase on such date;
provided that in no event shall the amount of the Offered
Securities that any Underwriter has agreed to purchase
pursuant to this Agreement be increased pursuant to this
Section 8 by an amount in excess of one-ninth of such amount
of the Offered Securities without the written consent of such
Underwriter. If, on the Closing Date, any Underwriter or
Underwriters shall fail or refuse to purchase the Offered
Securities that it has or they have agreed to purchase and
the aggregate amount of the Offered Securities with respect
to which such default occurs is more than one-tenth of the
aggregate amount of the Offered Securities to be purchased on
such date, and arrangements satisfactory to the
Representative and the Company for the purchase of such
Offered Securities are not made within 36 hours after such
default, the Underwriting Agreement shall terminate without
liability on the part of any non-defaulting Underwriter or
the Company. In any such case either the Representative or
the Company shall have the right to postpone the Closing Date
but in no event for longer than seven days, in order that the
required changes, if any, in the Registration Statement and
in the Prospectus or in any other documents or arrangements
may be effected. Any action taken under this paragraph shall
not relieve any defaulting Underwriter from liability in
respect of any default of such Underwriter under the
Underwriting Agreement.
If the Underwriting Agreement shall be terminated by the Underwriters,
or any of them, because of any failure or refusal on the part of the Company
to comply with the terms or to fulfill any of the conditions of the
Underwriting Agreement, or if for any reason the Company shall be unable to
perform its obligations under the Underwriting Agreement, the Company will
reimburse the Underwriters or such Underwriters as have so terminated the
Underwriting Agreement with respect to themselves, severally, for all out-of-
pocket expenses (including the fees and disbursements of their counsel)
reasonably incurred by such Underwriters in connection with the Underwriting
Agreement or the offering of the Offered Securities.
9. Representations and Indemnities to Survive. The respective
indemnity and contribution agreements and the representations,
warranties and other statements of the Company, its officers and
the Underwriters set forth in the Underwriting Agreement will
remain in full force and effect, regardless of any termination of
the Underwriting Agreement, any investigation made by or on behalf
of any Underwriter or the Company or any of the officers,
directors or controlling persons referred to in Section 6 and
delivery of and payment for the Offered Securities.
10. Successors. This Agreement will enure to the benefit of and be
binding upon the parties hereto and their respective successors
and the officers, directors and controlling persons referred to in
Section 6, and no other person will have any right or obligation
hereunder.
11. Counterparts. The Underwriting Agreement may be signed in any
number of counterparts, each of which shall be an original, with
the same effect as if the signatures thereto and hereto were upon
the same instrument.
12. Applicable Law. The Underwriting Agreement shall be governed
by and construed in accordance with the internal laws of the State
of New York.
13. Headings. The headings of the sections of the
Underwriting Agreement have been inserted for convenience of
reference only and shall not be deemed a part of the
Underwriting Agreement.
14. Notices. All communications hereunder will be in writing and,
if sent to the Underwriters, will be mailed, delivered or
telecopied and confirmed to Xxxxxx Xxxxxxx & Co. Incorporated at
0000 Xxxxxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attn: Managing
Director - Debt Syndicate, Telecopy No: (000) 000-0000, or, if
sent to the Company, will be mailed, delivered or telecopied and
confirmed to it at X.X. Xxx 0000, Xxxxxxxx, Xxxxx Xxxxxxxx 00000-
1398 [400 Xxx Xxxx, Xxxxxxxx, Xxxxx Xxxxxxxx 00000], Attn: Xx.
Xxxx X. Xxxxx, Treasurer, Telecopy No: (000) 000-0000.
Please confirm your agreement by having an authorized officer sign a
copy of the Underwriting Agreement in the space set forth below.
Very truly yours,
XXXXXX XXXXXXX & CO. INCORPORATED
By: /s/ Xxxxx X. Xxxxxxxx _
Name: Xxxxx X. Xxxxxxxx
Title: Principal
Accepted, January 10, 1996
PUBLIC SERVICE COMPANY OF NORTH CAROLINA,
INCORPORATED
By: /s/ Xxxxxxx X. Xxxxxxx, Xx.
Name: Xxxxxxx X. Xxxxxxx, Xx.
Title: Chairman, President and Chief Executive Officer
Schedule I
Principal Amount
Name of Underwriter of Offered Securities
Xxxxxx Xxxxxxx & Co. Incorporated. . . . . . . . . . . . . . . . . . . . . .
. . . . .$50,000,000
Schedule II
Underwriting Agreement dated January 10, 1996
Registration Statement No. 33-6502
Representative and Address:
Xxxxxx Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Securities: Senior Debentures
Designation: 6.99% Senior Debentures due 2026
Principal Amount: $50,000,000
Supplemental Indenture
dated as of: January 1, 1996
Date of Maturity: January 15, 2026
Interest Rate: 6.99%
Purchase Price: 99.125% plus accrued interest, if any, from January 16,
1996
Public Offering Price: 100% plus accrued interest, if any, from January 16,
1996
Type of Funds/Method
of Payment: Same Day Funds/Wire Transfer
Closing Date
and Location: January 16, 1996, at the offices of Fennebresque, Clark,
Xxxxxxxx & Hay, Charlotte, North Carolina
Schedule III
The properties owned by Public Service Company of North Carolina Incorporated
("Company") are subject to the lien of the Indenture dated as of January 1,
1952, between Public Service Company of North Carolina, Incorporated, and The
Marine Midland Trust Company of New York (now known as Marine Midland Bank),
Trustee, as supplemented by the First through Twelfth Supplemental Indentures
(collectively "1952 Indenture"). By letter dated December 21, 1995, the
Trustee acknowledged that no bonds remain outstanding under the 1952 Indenture,
as all such bonds have either matured or been redeemed in full with funds
provided by the Company. The Company has forwarded a separate "Deed of
Release" for each county in North Carolina in which the 1952 Indenture was
recorded to the Trustee for execution and return to the Company. Upon receipt,
the Company will file, or cause to be filed, in the appropriate county of North
Carolina, each separate Deed of Release, and upon receipt of the filed Deeds
of Release, provide copies of each with the recording information to the
Representative and the Trustee, as each such term is defined in the
Underwriting Agreement.
