EXHIBIT 1.1
4,000,000 PREFERRED SECURITIES
PP&L CAPITAL TRUST
(a Delaware Trust)
Trust Originated Preferred Securities ("TOPrS")/SM/
UNDERWRITING AGREEMENT
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March __, 1997
XXXXXXX XXXXX & CO.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
As Underwriters,
c/o Merrill Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated,
Xxxxxxx Xxxxx World Headquarters,
Xxxxx Xxxxx,
Xxxxx Xxxxxxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000.
Dear Sirs:
1. Introductory.
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PP&L Capital Trust (the "Trust"), a statutory business trust organized
under the Business Trust Act (the "Delaware Act") of the State of Delaware
(Chapter 38, Title
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/SM/ "Trust Originated Preferred Securities" and "TOPrS" are service marks of
Xxxxxxx Xxxxx & Co., Inc.
12, of the Delaware Code, 12 Del. C. (S)(S) 3801 et seq.),
-- ---
and Pennsylvania Power & Light Company, a Pennsylvania corporation (the
"Company" and, together with the Trust, the "Offerors"), confirm their agreement
(the "Agreement") with Xxxxxxx Xxxxx & Co., Xxxxxxx Lynch, Pierce, Xxxxxx &
Xxxxx Incorporated ("Xxxxxxx Xxxxx"), and the other
underwriters named in Schedule A hereto (collectively the "Underwriters" which
term shall also include any underwriter substituted as hereinafter provided in
Section 10 hereof), with respect to the sale by the Trust and the purchase by
the Underwriters, acting severally and not jointly, of the respective numbers of
Trust Originated Preferred Securities (Liquidation Amount of $25 per Preferred
Security) of the Trust ("Preferred Securities") set forth in Schedule A hereto.
The Preferred Securities will be fully, irrevocably and unconditionally
guaranteed by the Company as and to the extent described in the Prospectus (the
"Guarantee") pursuant to the Guarantee Agreement (the "Guarantee Agreement"),
dated as of _________, 1997, between the Company and The Chase Manhattan Bank,
as trustee (the "Guarantee Trustee"). The Preferred Securities and the related
Guarantee are referred to herein as the "Securities". Certain terms of the
Securities are set forth in Schedule B hereto.
The Offerors understand that the Underwriters propose to make a public
offering of the Securities. The entire proceeds from the sale of the Securities
will be combined with the entire proceeds from the sale by the Trust to the
Company of its common securities (the "Common Securities"), as guaranteed by the
Company as and to the extent set forth in the Prospectus pursuant to the
Guarantee Agreement, and will be used by the Trust to purchase junior
subordinated deferrable interest debentures (the "Junior Subordinated
Debentures") issued by the Company. The Preferred Securities and the Common
Securities will be issued pursuant to the Amended and Restated Trust Agreement
of the Trust, dated as of _______________, 1997 (the "Trust Agreement"), among
the Company, as Depositor, ______________
---------------
/SM/ "Trust Originated Preferred Securities" and "TOPrS" are service marks of
Xxxxxxx Xxxxx & Co., Inc.
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and _______________, as administrative trustees (each of whom
is an employee of the Company) (the "Administrative
Trustees"), The Chase Manhattan Bank, as property trustee (the "Property
Trustee"), and Chase Manhattan Bank Delaware, as Delaware trustee (the "Delaware
Trustee" and, together with the Administrative Trustees and the Property
Trustees, the "Trustees"). The Junior Subordinated Debentures will be issued
pursuant to an indenture, dated as of _________, 1997 (the "Indenture"), between
the Company and The Chase Manhattan Bank, as trustee (the "Indenture Trustee").
In connection with the foregoing, the Offerors have filed with the
Securities and Exchange Commission (the "Commission") a registration statement
on Form S-3 (No. 333-20661) for the registration under the Securities Act of
1933, as amended (the "1933 Act"), of the Securities, and the Junior
Subordinated Debentures. A prospectus setting forth the terms of the Securities
and the Junior Subordinated Debentures and of their sale and distribution has
been or will be prepared and will be filed or transmitted for filing pursuant to
Rule 424 under the 1933 Act. Such registration statement (as amended, if
applicable) and the prospectus constituting a part thereof, as from time to time
amended or supplemented pursuant to the 1933 Act, the Securities Exchange Act of
1934, as amended (the "1934 Act"), or otherwise, are hereinafter referred to as
the "Registration Statement" and the "Basic Prospectus", respectively; and the
Basic Prospectus, as it may be amended or supplemented, is herein referred to as
the "Prospectus" (including, in each case, all documents incorporated or deemed
to be incorporated by reference therein pursuant to Item 12 of Form S-3 under
the 1933 Act and the information, if any, deemed to be part thereof pursuant to
Rule 430A(b) of the published rules and regulations of the Commission under the
1933 Act (the "1933 Act Regulations")), except that, if any revised prospectus
shall be provided to the Underwriters by the Offerors for use in connection with
the offering of the Preferred Securities which differs from the Prospectus on
file at the Commission at the time the Registration Statement becomes effective
(whether or not such revised prospectus is required to be filed by the Offerors
pursuant to Rule 424(b) of the 1933 Act Regulations), the term "Prospectus"
shall refer to such
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revised prospectus from and after the time it is first provided
to the Underwriters for such use. All references in this Agreement to
financial statements and schedules and other information that is "contained,"
"included" or "stated" in the Registration Statement or the Prospectus (and all
other references of like import) shall be deemed to mean and include all such
financial statements and schedules and other information that are or are deemed
to be incorporated by reference in the Registration Statement or the Prospectus,
as the case may be; and all references in this Agreement to amendments or
supplements to the Registration Statement or the Prospectus shall be deemed to
mean and include the filing of any document under the 1934 Act that is or is
deemed to be incorporated by reference in the Registration Statement or the
Prospectus, as the case may be.
2. Representations and Warranties.
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(a) The Offerors jointly and severally represent and warrant to, and agree
with, each Underwriter that:
(i) The Registration Statement, when it became or becomes effective, and
the Prospectus and any amendment or supplement thereto, when filed or
transmitted for filing with the Commission and on the date of this Agreement,
complied or will comply in all material respects with the requirements of the
1933 Act and the 1933 Act Regulations and the Trust Indenture Act of 1939, as
amended (the "1939 Act") and the rules and regulations of the Commission under
the 1939 Act (the "1939 Act Regulations"), and did not or will not contain an
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not misleading;
provided, however, that the representations and warranties in this subsection
shall not apply to statements in or omissions from the Registration Statement or
Prospectus made in reliance upon and in conformity with the information
furnished to the Offerors in writing by any Underwriter through Xxxxxxx Xxxxx
expressly for use in the Registration Statement or Prospectus.
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(ii) The documents incorporated or deemed to be incorporated by reference in
the Registration Statement or Prospectus, at the time they were or hereafter are
filed with the Commission, complied and will comply in all material respects
with the requirements of the 1933 Act, the 1933 Act Regulations, the 1934 Act
and the rules and regulations of the Commission under the 1934 Act (the "1934
Act Regulations"), as applicable, and, at the time the Registration Statement
and any amendments thereto become effective and at the Closing Date, 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
the light of the circumstances under which they were made, not misleading;
provided, however, that the representations and warranties in this subsection
shall not apply to statements in or omissions from the Registration Statement or
Prospectus made in reliance upon and in conformity with information furnished to
the Offerors in writing by any Underwriter through Xxxxxxx Xxxxx expressly for
use in the Registration Statement or Prospectus.
(iii) The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the Commonwealth of Pennsylvania
with corporate power and authority to enter into and perform its obligations
under this Agreement, the Trust Agreement, the Indenture, and the Guarantee and
to purchase, own, and hold the Common Securities issued by the Trust.
(iv) The Trust has been duly created and is validly existing in good
standing as a business trust under the laws of the State of Delaware with the
power and authority to own property and to conduct its business as described in
the Registration Statement and Prospectus and to enter into and perform its
obligations under this Agreement, the Preferred Securities, the Common
Securities and the Trust Agreement; the Trust is not a party to or otherwise
bound by any agreement other than those described in the Prospectus; the Trust
is and will be classified for
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United States federal income tax purposes as a grantor trust and not as an
association taxable as a corporation; and the Trust is and will be treated as a
consolidated subsidiary of the Company pursuant to generally accepted accounting
principles.
(v) The Common Securities have been duly authorized by the Trust Agreement
and, when issued and delivered by the Trust to the Company against payment
therefor as described in the Registration Statement and Prospectus, will be
validly issued and (subject to the terms of the Trust Agreement) fully paid and
non-assessable undivided beneficial interests in the assets of the Trust and
will conform in all material respects to the statements relating thereto
contained in the Prospectus; the issuance of the Common Securities is not
subject to preemptive or other similar rights; and at the Closing Date all of
the issued and outstanding Common Securities of the Trust will be directly owned
by the Company free and clear of any security interest, mortgage, pledge, lien,
encumbrance, claim or equity.
(vi) This Agreement has been duly authorized, executed and delivered by
each of the Offerors.
(vii) The Trust Agreement has been duly authorized by the Company and, at
the Closing Date, will have been duly executed and delivered by the Company and,
assuming due authorization, execution and delivery of the Trust Agreement by the
Trustees, the Trust Agreement will be a valid and binding obligation enforceable
in accordance with its terms except to the extent that enforcement thereof may
be limited by bankruptcy, insolvency or reorganization laws relating to or
affecting the enforcement of creditors' rights and by general equity principles
(the "Bankruptcy Exceptions"), and will conform in all material respects to the
statements relating thereto contained in the Prospectus; and at the effective
date of the Registration Statement, the Trust Agreement was or will have been
duly qualified under the 1939 Act.
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(viii) The Guarantee Agreement has been duly authorized by the Company and,
at the Closing Date, will have been duly executed and delivered by the Company
and, assuming due authorization, execution and delivery of the Guarantee by the
Guarantee Trustee, will constitute a valid and binding obligation of the Company
enforceable in accordance with its terms except to the extent that enforcement
thereof may be limited by the Bankruptcy Exceptions, and the Guarantee and the
Guarantee Agreement will conform in all material respects to the statements
relating thereto contained in the Prospectus; and at the effective date of the
Registration Statement the Guarantee Agreement was or will have been duly
qualified under the 1939 Act.
(ix) The Preferred Securities have been duly authorized by the Trust
Agreement and, when issued and delivered pursuant to this Agreement, will be
validly issued and (subject to the terms of the Trust Agreement) fully paid and
non-assessable undivided beneficial interests in the Trust, will be entitled to
the benefits of the Trust Agreement and will conform in all material respects to
the statements relating thereto contained in the Prospectus; the issuance of the
Preferred Securities is not subject to preemptive or other similar rights.
(x) The Indenture has been duly authorized by the Company and, at the
Closing Date, will have been duly executed and delivered by the Company and,
assuming due authorization, execution and delivery by the Indenture Trustee,
will constitute a valid and binding agreement of the Company enforceable in
accordance with its terms except to the extent that enforcement thereof may be
limited by the Bankruptcy Exceptions, and will conform in all material respects
to the statements relating thereto contained in the Prospectus; and at the
effective date of the Registration Statement, the Indenture was or will have
been duly qualified under the 1939 Act.
(xi) The Junior Subordinated Debentures have been duly authorized by the
Company and, at the Closing
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Date, will have been duly executed by the Company
and, when authenticated in the manner provided for in the Indenture and
delivered against payment therefor as described in the Prospectus, will
constitute valid and binding obligations of the Company enforceable in
accordance with their terms except to the extent that enforcement thereof may be
limited by the Bankruptcy Exceptions; will be in the form contemplated by, and
entitled to the benefits of, the Indenture; and will conform in all material
respects to the statements relating thereto contained in the Prospectus.
(b) Each of the several Underwriters represents and warrants to, and agrees
with, the Offerors, their respective directors and such of their respective
officers who shall have signed the Registration Statement, and to each other
Underwriter, that the information set forth in Schedule C hereto furnished to
the Offerors by or through you on behalf of such Underwriter expressly for use
in the Registration Statement or the Prospectus does not contain an untrue
statement of a material fact and does not omit to state a material fact in
connection with such information required to be stated therein or necessary to
make such information not misleading.
3. Purchase and Sale of Preferred Securities.
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On the basis of the representations, warranties and agreements herein
contained, but subject to the terms and conditions herein contained, the Trust
agrees to sell to each Underwriter, severally and not jointly, and each
Underwriter, severally and not jointly, agrees, to purchase from the Trust the
number of Preferred Securities set forth in Schedule A opposite the name of such
Underwriter, plus any additional number of Preferred Securities that such
Underwriter may become obligated to purchase pursuant to the provisions of
Section 10 hereof at the price per security set forth in Schedule B hereto.
4. Delivery and Payment.
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Payment of the full purchase price of the Preferred
Securities shall be made by or on behalf of the
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several Underwriters by the wire transfer of immediately available funds to the
Trust's account (No. _________) at _________________ (ABA Routing No. _________)
by 10:00 A.M., New York Time, on the Closing Date (as hereinafter defined). Such
payment shall be made against delivery to The Depository Trust Company ("DTC")
for the respective accounts of the Underwriters of a global certificate for the
Preferred Securities to be purchased by them. Certificates for the Preferred
Securities shall be in such denominations and registered in such names as
Xxxxxxx Xxxxx may request in writing at least two business days before the
Closing Date, or to the extent not so requested, registered in the names of the
several Underwriters in such authorized denominations as the Offerors may
determine. It is understood that each Underwriter has authorized Xxxxxxx Xxxxx,
for its account, to accept delivery of, receipt for, and make payment of the
purchase price for, the Preferred Securities which it has agreed to purchase.
Xxxxxxx Xxxxx, individually and not as representative of the Underwriters, may
(but shall not be obligated to) make payment of the purchase price for the
Preferred Securities to be purchased by any Underwriter whose wire transfer has
not been received by the Closing Date, but such payment shall not relieve such
Underwriter from its obligations hereunder.
At the Closing Date, the Company will pay, or cause to be paid, the
commission payable at such time to the Underwriters set forth in Schedule B
hereto by the wire transfer of immediately available funds to the account of
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated (No. ________) at
_____________ (ABA Routing No. _________) to the attention of
___________________.
For the purpose of expediting the checking and packaging of the
certificates evidencing the Preferred Securities, the Offerors will make the
global certificate for the Preferred Securities available for inspection by the
Underwriters at the offices of _____________________________ not later than
10:00 A.M., New York time, on the business day next preceding the Closing Date.
The term "Closing Date" wherever used in this Agreement shall mean the date
set forth in Schedule B
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hereto, or such other date (i) not later than the eighth
full business day thereafter as may be agreed upon in writing by the Company,
the Trust and the Underwriters, or (ii) as shall be determined by postponement
pursuant to the provisions of Section 10 hereof.
5. Certain Covenants of the Offerors.
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Each of the Offerors jointly and severally covenant with the several
Underwriters as follows:
(a) To notify the Underwriters promptly, and confirm the notice in writing,
(i) of any request by the Commission for any amendment to the Registration
Statement or any amendment or supplement to the Prospectus or for additional
information, and (ii) the institution by the Commission of any stop order
proceedings in respect of the Registration Statement, or the initiation of
proceedings for that purpose, and to use its best efforts to prevent the
issuance of any such stop order and to obtain as soon as possible its lifting,
if issued;
(b) To file the Prospectus with the Commission pursuant to Rule 424(b)
under the 1933 Act not later than the second business day following the
execution and delivery of this Agreement, or, if applicable, such earlier time
as may be required by Rule 430A(a)(3) under the 1933 Act; to advise you promptly
of any such filing; and to advise you promptly of any proposal to file or
prepare (i) any amendment to the Registration Statement (including any post-
effective amendment), (ii) any amendment or supplement to the Prospectus
(including any revised prospectus which the Offerors propose for use by the
Underwriters in connection with the offering of the Preferred Securities which
differs from the prospectus on file at the Commission at the time the
Registration Statement becomes effective, whether or not such revised prospectus
is required to be filed pursuant to Rule 424(b) of the 1933 Act Regulations), or
(iii) any document that would as a result thereof be incorporated by reference
in the Prospectus whether pursuant to the 1933 Act, the 1934
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Act or otherwise; and will furnish the Underwriters with copies of any such
amendment, supplement or other document a reasonable amount of time prior to
such proposed filing or use, as the case may be, and will not file any such
amendment, supplement or other document or use any such prospectus to which the
Underwriters or counsel for the Underwriters shall reasonably object in writing;
(c) To use their best efforts, in cooperation with the
Underwriters, to qualify the Preferred Securities (and the Guarantee) and the
Junior Subordinated Debentures for offer and sale under the securities or blue
sky laws of such states and the other jurisdictions of the United States as the
Underwriters may designate, to continue such qualifications in effect so long as
required for the distribution of the Preferred Securities and to reimburse you
for any expenses (including filing fees and fees and disbursements of counsel)
paid by you or on your behalf to qualify the Preferred Securities for offer and
sale, to continue such qualification, to determine the eligibility of the
Preferred Securities for investment and to print the memoranda relating thereto;
provided that none of the Offerors shall be required to qualify as a foreign
corporation in any jurisdiction in which it is not so qualified, to consent to
service of process in any jurisdiction other than with respect to claims arising
out of the offering or sale of the Preferred Securities, or to meet any other
requirement in connection with this paragraph (c) deemed by such Offeror to be
unduly burdensome; and the Company will advise Xxxxxxx Xxxxx promptly of any
order or communication of any public authority known to the Company suspending
or threatening to suspend the qualification of the Preferred Securities for
sale, or the eligibility of the Preferred Securities for purchase by such
institutions, in any jurisdiction;
(d) Promptly to deliver to you two signed copies of the Registration
Statement as originally filed and of all amendments thereto heretofore or
hereafter filed, including conformed copies of all exhibits
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except those incorporated by reference, and such number of unsigned copies of
the Registration Statement (but excluding the exhibits), each related
preliminary prospectus, the Prospectus, and any amendments and supplements
thereto, as the Underwriters may reasonably request;
(e) Promptly to furnish to each Underwriter, from time to time during the
period when the Prospectus is required to be delivered under the 1933 Act, such
number of copies of the Prospectus (as amended or supplemented) as such
Underwriter may reasonably request for the purposes contemplated by the 1933 Act
or the 1933 Act Regulations;
(f) If, at any time when the Prospectus relating to
the Preferred Securities is required to be delivered under the 1933 Act in
connection with sales of the Preferred Securities, any event occurs as a result
of which the Prospectus as then amended or supplemented would include an untrue
statement of a material fact or omit to state any material fact necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading, or if it is necessary at any time to amend the
Registration Statement or amend or supplement the Prospectus to comply with the
1933 Act or the 1933 Act Regulations, to advise the Underwriters of such event
or necessity, as the case may be, and, promptly upon request made by the
Underwriters, to prepare and file with the Commission subject to paragraph (b)
above an amendment or supplement which will correct such statement or omission
or an amendment which will effect such compliance; provided that the expense of
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preparing and filing any such amendment or supplement (i) which is necessary in
connection with such a delivery of the Prospectus more than nine months after
the date of this Agreement or (ii) which relates solely to the activities of any
Underwriter shall be borne by the Underwriter or Underwriters or the dealer or
dealers requiring the same; and provided further that the Underwriters shall,
upon inquiry by the Company, advise the Company whether or not any Underwriter
or dealer
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which shall have been selected by you retains any unsold Preferred
Securities and, for the purposes of this paragraph (f), the Company shall be
entitled to assume that the distribution of the Preferred Securities has been
completed when it is advised by you that no Underwriter or such dealer retains
any Preferred Securities;
(g) As soon as practicable, the Trust will make generally available to its
security holders an earnings statement of the Company covering a period of at
least twelve months beginning after the "effective date of the registration
statement" within the meaning of Rule 158 under the 1933 Act which will satisfy
the provisions of Section 11(a) of the 1933 Act;
(h) The Offerors will use best efforts to effect the listing of the
Preferred Securities on the New York Stock Exchange; if the Preferred Securities
are exchanged for Junior Subordinated Debentures, the Company will use its best
efforts to effect the listing of the Junior Subordinated Debentures on the
exchange on which the Preferred Securities were then listed;
(i) During a period of 30 days from the date of this Agreement, neither the
Trust nor the Company will, without the Underwriters' prior written consent,
directly or indirectly, sell, offer to sell, grant any option for the sale of,
or otherwise dispose of, any Preferred Securities, any security convertible into
or exchangeable into or exercisable for Preferred Securities or the Junior
Subordinated Debentures or any debt securities substantially similar to the
Junior Subordinated Debentures or equity securities substantially similar to the
Preferred Securities (except for the Junior Subordinated Debentures and the
Preferred Securities issued pursuant to this Agreement); and
(j) The Trust will apply the net proceeds from the sale of the Preferred
Securities for the purposes set forth in the Prospectus.
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6. Payment of Expenses.
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The Company will pay or bear (i) all expenses in connection with the
matters herein required to be performed by the Offerors, including all expenses
(except as provided in Section 5(f) hereof) in connection with the preparation
and filing of the Registration Statement and the Prospectus, and any amendment
or supplement thereto, and the furnishing of copies thereof to the Underwriters,
and all audits, statements or reports in connection therewith, and all expenses
in connection with the original issue and delivery of the Preferred Securities
to the Underwriters at the place designated in Section 4 hereof, and all Federal
and State taxes (if any) payable (not including any transfer taxes) upon the
original issue of the Preferred Securities, the Guarantee or the Junior
Subordinated Debentures, any fee charged by securities ratings services for
rating the Preferred Securities, the Guarantee and the Junior Subordinated
Debentures, the fees and expenses incurred in connection with the listing of the
Preferred Securities, and the fee of the National Association of Securities
Dealers, Inc., if any, (ii) all expenses in connection with the printing,
reproduction and delivery of this Agreement and the printing, reproduction and
delivery of such other documents or certificates as may be required in
connection with the offering, purchase, sale, issuance or delivery of the
Preferred Securities, the Guarantee and the Junior Subordinated Debentures, and
to reimburse the Underwriters for expenses incurred in distributing any
preliminary prospectus or supplement to the Underwriters, and (iii) any
additional costs of effecting payment of the purchase price of the Preferred
Securities in immediately available funds as compared with New York Clearing
House (next day) funds.
7. Conditions of Underwriters' Obligations.
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The obligations of the Underwriters hereunder are subject to the following
conditions:
(a) The Underwriters shall have received from Price Waterhouse LLP, a
letter, dated the date of this Agreement, in form and substance satisfactory to
you, to the effect that:
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(i) They are independent accountants with respect to the Trust and the
Company within the meaning of the 1933 Act and the 1933 Act Regulations;
(ii) In their opinion, the consolidated financial statements of the Company
and its subsidiaries audited by them and incorporated by reference in the
Registration Statement comply as to form in all material respects with the
applicable accounting requirements of the 1933 Act and the 1934 Act and the
published rules and regulations thereunder with respect to registration
statements on Form S-3.
(iii) On the basis of procedures (but not an audit in accordance with
generally accepted auditing standards) consisting of:
(A) Reading the minutes of the stockholders and the Board of Directors of
the company and its consolidated subsidiaries since December 31, 1996 as set
forth in the minute books through a specified date nor more than five business
days prior to the date of delivery of such letter;
(B) Reading the unaudited interim financial data for the period from the
date of the latest balance sheet included in the Registration Statement to the
date of the latest available interim financial data; and
(C) Making inquiries of certain officials of the Company who have
responsibility for financial and accounting matters regarding the specific items
for which representations are requested below;
nothing has come to their attention as a result of the foregoing procedures that
caused them to believe that (i) at the date of the latest available interim
financial data and at a
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specified date not more than five business days prior to the date of delivery of
such letter, there was any change in the capital stock (except for shares of
certain series of the Company's preferred and preference stocks redeemed for, or
purchased and retired in anticipation of, sinking fund requirements for such
series or for shares of common stock issued pursuant to the Company's Employee
Stock Ownership Plan), or increase in long-term debt of the Company and
subsidiaries consolidated as compared with amounts shown in the latest balance
sheet incorporated by reference in the Registration Statement or (ii) for the
period from the closing date of the latest consolidated income statement
incorporated by reference in the Registration Statement to the date of the
latest available interim financial data there were any decreases, as compared
with the corresponding period in the preceding year, in consolidated net income
before dividends on preferred and preference stock, except in all instances for
changes or decreases which the Registration Statement discloses have occurred or
may occur, or they shall state any specific changes or decreases.
(iv) The letter shall also state that the information set forth in Schedule
D hereto, which is expressed in dollars (or percentages derived from such dollar
amounts) and has been obtained from accounting records which are subject to the
internal controls of the Company's accounting system or which has been derived
directly from such accounting records by analysis or computation, is in
agreement with such records or computations made therefrom, except as otherwise
specified in such letter.
(b) The Prospectus shall have been filed with the Commission in accordance
with the 1933 Act Regulations and Section 5(b) of this Agreement and prior to
the Closing Date no stop order suspending the effectiveness of the Registration
Statement shall have been issued
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and no proceedings for that purpose shall have been instituted, or, to the
knowledge of the Offerors, shall be contemplated by the Commission and the
Underwriters shall have received at the Closing Date certificates, dated the
Closing Date, of the Company and of the Trust.
(c) Subsequent to the execution of this Agreement, there shall not have
occurred (i) any change or any development involving a prospective change not
contemplated by the Prospectus in or affecting particularly the business or
properties of the Trust or the Company, which, in the judgment of Xxxxxxx Xxxxx,
materially impairs the investment quality of the Preferred Securities; (ii) any
suspension or limitation of trading in securities generally on the New York
Stock Exchange, or any setting of minimum prices for trading on such exchange,
or any suspension of trading of any securities of the Company on any exchange or
in the over-the-counter market; (iii) a general banking moratorium declared by
Federal or New York authorities; (iv) any outbreak or escalation of major
hostilities in which the United States is involved, any declaration of war by
Congress or any other substantial national or international calamity or
emergency if, in the reasonable judgment of Xxxxxxx Xxxxx, the effect of any
such outbreak, escalation, declaration, calamity or emergency makes it
impractical and inadvisable to proceed with completion of the sale of and
payment for the Preferred Securities and Xxxxxxx Xxxxx makes a similar
determination with respect to all other underwritings of Trust Originated
Preferred Securities in which it is participating and has the contractual right
to make such a determination; or (v) any decrease in the ratings of the
Preferred Securities by any "nationally recognized statistical rating
organization" (as defined for purposes of Rule 436(g) under the 0000 Xxx) or
such organization shall have publicly announced that it has under surveillance
or review, with possible negative implications, its rating of the Preferred
Securities.
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(d) On the Closing Date the Underwriters shall have received:
(1) The favorable opinions, dated as of the Closing Date, of Xxxxxxx X.
XxXxxxx, Esq., Senior Counsel (or such other counsel for the Company as may be
acceptable to you), Xxxxxxx Xxxxxxx & Xxxxxxxx, special counsel to the Company,
and Xxxxxxxx, Xxxxxx & Finger, P.A., special Delaware counsel to the Offerors,
each in form and substance satisfactory to counsel for the Underwriters, to the
cumulative effect that:
(i) The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the Commonwealth of Pennsylvania
with power and authority (corporate and other) to own its properties and conduct
its business as described in the Prospectus;
(ii) The Trust has been duly created and is validly existing in good
standing as a business trust under the laws of the State of Delaware; all
filings required under the laws of the State of Delaware with respect to the
creation and valid existence of the Trust as a business trust have been made;
the Trust has all necessary power and authority to own property and to conduct
its business as described in the Prospectus and to enter into and perform its
obligations under this Agreement, the Preferred Securities and the Common
Securities;
(iii) The Trust Agreement has been duly authorized, executed and delivered
by the Company and, assuming due authorization, execution and delivery of the
Trust Agreement by the Trustees, is a valid and binding obligation enforceable
in accordance with its terms, except to the extent that enforcement thereof may
be limited by the Bankruptcy Exceptions; and the Trust Agreement has been duly
qualified under the 1939 Act;
(iv) The Common Securities have been duly authorized for issuance and,
when issued, delivered and
-18-
paid for in accordance with the Trust Agreement and as described in the
Prospectus, will be validly issued and fully paid and non-assessable undivided
beneficial interests in the assets of the Trust, and the issuance of the Common
Securities is not subject to preemptive or other similar rights;
(v) The Preferred Securities have been duly authorized for issuance and,
when issued, delivered and paid for in accordance with this Agreement, will be
validly issued, fully paid and non-assessable undivided beneficial interests in
the assets of the Trust; the holders of the Preferred Securities will be
entitled to the same limitation of personal liability under Delaware law as is
extended to stockholders of private corporations for profit; and the issuance of
the Preferred Securities is not subject to preemptive or other similar rights.
Such counsel may note that the Preferred Securities holders may be obligated,
pursuant to the Trust Agreement, to (a) provide indemnity and/or security in
connection with and pay taxes or governmental charges arising from transfers of
Preferred Securities and the issuance of replacement Preferred Securities, and
(b) provide security and indemnity in connection with requests of or directions
to the Trustees to exercise their rights and powers under the Trust Agreement;
(vi) The holders of the Preferred Securities and Common Securities (other
than those holders who reside or are domiciled in the State of Delaware) will
have no liability for income taxes imposed by the State of Delaware or any
taxing authority thereof solely as a result of their participation in the Trust,
and the Trust will not be liable for any income tax imposed by the State of
Delaware or any taxing authority thereof;
(vii) The statements in the Prospectus under the captions "PP&L Capital
Trust", "Description of Preferred Securities", "Description of Subordinated
Debentures", "Description of Guarantee" and "Relationship Among the Preferred
Securities, the Subordinated Debentures and the Guarantee", insofar as
-19-
they purport to constitute summaries of certain terms of the Preferred
Securities, the Junior Subordinated Debentures, the Guarantee and the Company
agreements with respect thereto, in each case constitute accurate summaries of
the terms of such documents and securities, in all material respects;
(viii) The portions of the information contained in the Prospectus, which
are stated therein to have been made on the authority of any such counsel, have
been reviewed by such counsel and, as to matters of law and legal conclusions,
are correct;
(ix) Each of the Company and PP&L Resources, Inc. are exempt from the
provisions of the Public Utility Holding Company Act of 1935, as amended,
applicable to it as a holding company;
(x) Except as described in the Registration Statement and the Prospectus,
the Company holds all franchises, certificates of public convenience, licenses
and permits necessary to own and to operate its properties and to carry on the
utility business in which it is engaged;
(xi) The Registration Statement has become effective under the 1933 Act
and the Prospectus was filed with the Commission pursuant to the subparagraph of
Rule 424(b) specified in such opinion on the date specified therein, and, to the
best of the knowledge of such counsel, no stop order suspending the
effectiveness of the Registration Statement or any part thereof has been issued
and no proceeding for that purpose have been instituted or are pending or
contemplated under the 1933 Act, and the Registration Statement, as of its
effective date, and any amendment or supplement thereto, as of its date, and the
Prospectus, as of the date of this Agreement, and each amendment or supplement
thereto, as of its date, complied as to form in all material respects with the
requirements of the 1933 Act and the 1933 Act Regulations, and nothing has come
to the attention of such counsel which would lead such counsel to believe
-20-
either that the Registration Statement or any such amendment or supplement, as
of such dates, contained any untrue statement of a material fact or omitted to
state any material fact required to be stated therein or necessary to make the
statements therein not misleading, or that the Prospectus, as of the date of
this Agreement and as of the Closing Date, contained or contains any untrue
statement of a material fact or omitted or omits to state any material fact
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading; it being understood that such
counsel need express no opinion as to the financial statements and other
financial data contained or incorporated by reference in the Registration
Statement or the Prospectus and that only Xxxxxxx Xxxxxxx & Xxxxxxxx will pass
on federal income tax consequences;
(xii) The descriptions in the Registration Statement and the Prospectus of
statutes, legal and governmental proceedings and contracts and other documents
are accurate and fairly present the information required to be shown; and such
counsel does not know of any legal or governmental proceedings required to be
described in the Registration Statement or Prospectus which are not described,
or of any contracts or documents of a character required to be described in the
Registration Statement or the Prospectus or to be filed as exhibits to the
Registration Statement which are not described and filed as required; it being
understood that such counsel need express no opinion as to the financial
statements and other financial data contained or incorporated by reference in
the Registration Statement or the Prospectus and that only Xxxxxxx Xxxxxxx &
Xxxxxxxx will pass on federal income tax consequences pursuant to Section
7(d)(3);
(xiii) This Agreement has been duly authorized, executed and delivered by
each of the Trust and the Company;
-21-
(xiv) The Guarantee Agreement has been duly authorized, executed and
delivered by the Company; the Guarantee Agreement, assuming it is duly
authorized, executed, and delivered by the Guarantee Trustee, constitutes a
valid and binding obligation of the Company enforceable in accordance with its
terms, except to the extent that enforcement thereof may be limited by the
Bankruptcy Exceptions; and the Guarantee Agreement has been duly qualified under
the 1939 Act;
(xv) The Indenture has been duly executed and delivered by the Company
and, assuming due authorization, execution, and delivery by the Indenture
Trustee, is a valid and binding obligation of the Company enforceable in
accordance with its terms, except to the extent that enforcement thereof may be
limited by the Bankruptcy Exceptions; and the Indenture has been duly qualified
under the 1939 Act;
(xvi) The Junior Subordinated Debentures are in the form contemplated by
the Indenture, have been duly authorized, executed and delivered by the Company
and, when authenticated by the Indenture Trustee in the manner provided for in
the Indenture and delivered against payment therefor, will constitute valid and
binding obligations of the Company enforceable in accordance with their terms,
except to the extent that enforcement thereof may be limited by the Bankruptcy
Exceptions, and are entitled to the benefits of the Indenture;
(xvii) Neither the Company nor the Trust is now, and giving effect to the
transactions contemplated by this Agreement, the Prospectus, and the application
of the proceeds from the sale of the Preferred Securities will be, an
"investment company" within the meaning of the 1940 Act; and
(xviii) No approval, authorization, consent or other order of any public
board or body is legally required for the authorization of the issuance and sale
of the Common Securities or the offering, issuance and sale of the Preferred
Securities, the Junior
-22-
Subordinated Debentures or the Guarantee, except (a) such as may be required
under the 1933 Act or the 1933 Act Regulations or the securities or "blue sky"
laws of any jurisdiction, (b) the qualification of the Trust Agreement, the
Guarantee Agreement and the Indenture under the 1939 Act and 1939 Act
Regulations and (c) the approvals by the Pennsylvania Public Utility Commission
which have been received.
In rendering their opinion, Xxxxxxx Xxxxxxx & Xxxxxxxx and Xxxxxxxx, Xxxxxx
& Finger, P.A. may rely as to matters governed by Pennsylvania law upon the
opinion of Xxxxxxx X. XxXxxxx, Esq. or such other counsel referred to in Section
7(d) of this Agreement, and as to matters governed by Delaware law Xxxxxxx
Xxxxxxx & Xxxxxxxx may rely upon the opinion of Xxxxxxxx, Xxxxxx & Finger, P.A.
In rendering his opinion, Xxxxxxx X. XxXxxxx, Esq., or such other counsel
referred to in Section 7(d) of this Agreement, may rely as to matters governed
by Delaware law upon the opinion of Xxxxxxxx, Xxxxxx & Finger, P.A. All such
counsel may also state that, insofar as such opinion involves factual matters,
they have relied, to the extent they deem proper, upon representations of
officers of the Company and of the Trustees and certificates of public
officials; provided that such certificates have been delivered to the
Underwriters.
(2) The favorable opinion, dated as of the Closing Date, of Pryor, Cashman,
Xxxxxxx & Xxxxx, counsel for The Chase Manhattan Bank and Chase Manhattan Bank
Delaware, in their respective capacities as Trustees under the Trust Agreement,
the Guarantee Agreement, and the Indenture, in form and substance satisfactory
to counsel for the Underwriters, to the effect that:
(i) Such Trustees are banking corporations with trust powers, duly
organized, validly existing and in good standing under the laws of their
respective jurisdictions of incorporation, with all necessary power and
authority to execute and deliver, and to carry out and perform their respective
obligations
-23-
under the terms of, the Trust Agreement, the Guarantee Agreement and
the Indenture;
(ii) The execution, delivery and performance of the Trust Agreement, the
Guarantee Agreement and the Indenture have been duly authorized by all necessary
corporate action on the part of such Trustees, and constitute valid and binding
obligations of such Trustees in accordance with their terms, except as
enforcement thereof may be limited by the Bankruptcy Exceptions;
(iii) The execution, delivery and performance of the Trust Agreement, the
Guarantee Agreement and the Indenture by such Trustees do not conflict with or
constitute a breach of the Articles of Incorporation or Bylaws or other
governing instruments of such Trustees; and
(iv) No consent, approval or authorization of, or registration with or
notice to, any state or federal banking authority is required for the execution,
delivery or performance by the Trustees, the Trust Agreement, the Guarantee
Agreement or the Indenture.
Such opinion may be conditioned on, among other things, the initial and
continuing accuracy of the facts, financial and other information, covenants
and representations set forth in certificates of officers of the Company and
the Trust and other documents deemed necessary for such opinion.
(3) The opinion of Xxxxxxx Xxxxxxx & Xxxxxxxx, special tax counsel to the
Company and the Trust, generally to the effect that the statements made in the
Prospectus under the caption "Certain Federal Income Tax Consequences," insofar
as they purport to constitute summaries of matters of United States federal tax
law and regulations or legal conclusions with respect thereto, constitute
accurate summaries of the matters described therein in all material respects.
-24-
(4) The favorable opinion or opinions, dated as of the Closing Date, of
Xxxxxxxx & Xxxxxxxx, counsel for the Underwriters, with respect to the
incorporation and legal existence of the Company, the validity of the Guarantee
and the Junior Subordinated Debentures, this Agreement, the Registration
Statement, the Prospectus and other related matters as the Underwriters may
require, and the Company shall have furnished to such counsel such documents as
they request for the purpose of enabling them to pass upon such matters. In
rendering such opinion, Xxxxxxxx & Xxxxxxxx may rely as to matters governed by
Pennsylvania law upon the opinion of Xxxxxxx X. XxXxxxx, Esq. or such other
counsel for the Company referred to in Section 7(d), and as to matters governed
by Delaware law upon the opinion of Xxxxxxxx, Xxxxxx & Finger, P.A.
(e) The Underwriters shall have received a certificate, dated the Closing
Date, of the President or a Vice President and a financial or accounting officer
of the Company and a certificate of an Administrative Trustee of the Trust in
which such officers or trustee, as the case may be, to the best of their
knowledge after reasonable investigation, shall state that (i) the
representations and warranties of the Company or the Trust, as the case may be,
in this Agreement are true and correct (except for immaterial details) as of the
Closing Date, (ii) the Company and or Trust, as the case may be, has complied
with all agreements and satisfied all conditions on its part to be performed or
satisfied at or prior to the Closing Date, (iii) 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 by the Commission, and (iv)
subsequent to the date of the latest financial statements in the Prospectus,
there has been no material adverse change in the financial position or results
of operations of the Company or the Trust, as the case may be, except as set
forth or contemplated in the Prospectus or as described in such certificate.
(f) The Underwriters shall have received a letter from
Price Waterhouse LLP, dated the Closing Date,
-25-
which meets the requirements of Section 7(a) of this Agreement, except that the
specified date referred to in paragraph (D) of Section 7(a)(iii) will be a date
not more than five days prior to the Closing Date for the purposes of this
Section 7(f).
(g) At the Closing Date, the Preferred Securities and the Junior
Subordinated Debentures shall be rated in one of the four highest rating
categories for long term debt ("Investment Grade") by any nationally recognized
statistical rating agency, and the Company or the Trust shall have delivered to
the Underwriters a letter, dated the Closing Date, from such nationally
recognized statistical rating agency, or other evidence satisfactory to the
Underwriters, confirming that the Preferred Securities and the Junior
Subordinated Debentures have Investment Grade ratings.
(h) At the Closing Date, the Preferred Securities shall have been approved
for listing on the New York Stock Exchange subject to notice of issuance.
The Company will furnish the Underwriters as promptly as practicable after
the Closing Date with such conformed copies of such opinions, certificates,
letters and documents as the Underwriters may reasonably request.
In case any such condition shall not have been satisfied, this Agreement
may be terminated by the Underwriters upon notice in writing or by telegram to
the Offerors without liability or obligation of any party, except as provided in
Sections 5(c), 6, 9, 11 and 13 hereof.
8. Conditions of Offeror's Obligations.
-----------------------------------
The obligations of the Offerors to sell and deliver the Preferred
Securities on the Closing Date are subject to the following conditions:
At the Closing Date no stop order suspending the effectiveness of the
Registration Statement shall be in effect or proceeding therefor shall have been
-26-
instituted or, to the knowledge of the Offerors, shall be contemplated.
(b) At or before the Closing Date, the Pennsylvania Utility Commission and
any other regulatory authority whose consent or approval shall be required for
the issue and the sale of the Securities, the Guarantee and the Junior
Subordinated Debentures as herein provided shall have taken all requisite
action, or all requisite action shall be deemed in fact and law to have been
taken, to authorize such issue and sale on the terms set forth in the
Prospectus.
If either of the foregoing conditions shall not have been satisfied, then
the Offerors shall be entitled, by notice in writing or by telegram to the
Underwriters, to terminate this Agreement without any liability of any party,
except as provided in Sections 5(c), 6, 9, 11 and 13 hereof.
9. Indemnification and Contribution.
--------------------------------
The Offerors agree that they will jointly and severally indemnify and hold
harmless each Underwriter and each person, if any, who controls any Underwriter
within the meaning of Section 15 of the 1933 Act, against any and all loss,
expense, claim, damage or liability to which, jointly or severally, such
Underwriter or such controlling person may become subject, under the 1933 Act or
otherwise, insofar as such loss, expense, claim, damage or liability (or actions
in respect thereof) arises out of or is based upon any untrue statement or
alleged untrue statement of any material fact contained in the Registration
Statement, the Prospectus, any related preliminary prospectus, or any amendment
or supplement to any thereof, or arises out of or is based upon the omission or
alleged omission to state therein any material fact required to be stated
therein or necessary to make the statements therein not misleading; and, except
as hereinafter in this Section provided, the Offerors agree to reimburse each
Underwriter and each person who controls any Underwriter as aforesaid for any
reasonable legal or other expenses as incurred by such Underwriter or such
controlling person in connection with investigating or defending any such loss,
expense, claim, damage or
-27-
liability; provided, however, that the Offerors shall not be liable in any such
-------- -------
case to the extent that any such loss, expense, claim, damage or liability
arises out of or is based on an untrue statement or alleged untrue statement or
omission or alleged omission made in any such document in reliance upon, and in
conformity with, written information specified in Schedule B hereto furnished to
the Trust or the Company by any Underwriter through Xxxxxxx Xxxxx expressly for
use in any such document; and provided further, that with respect to any untrue
-------- -------
statement or alleged untrue statement or omission or alleged omission made in
any preliminary prospectus or supplement, the indemnity agreement contained in
this subsection (a) shall not inure to the benefit of any Underwriter from whom
the person asserting any such loss, expense, claim, damage or liability
purchased the Securities concerned (or to the benefit of any person controlling
such Underwriter), if a copy of the Prospectus (not including documents
incorporated by reference therein) or of the Prospectus as then amended or
supplemented (not including documents incorporated by reference therein) was not
sent or given to such person at or prior to the written confirmation of the sale
of such Securities to such person and any untrue statement or alleged untrue
statement or omission or alleged omission of a material fact contained in any
preliminary prospectus or supplement thereto was corrected in the Prospectus,
provided that the Company has delivered the Prospectus to the several
Underwriters in requisite quantity on a timely basis to permit such sending or
delivery.
(b) The Company agrees to indemnify the Trust against all loss, expense,
claim, damage or liability as due from the Trust under Section 9(a) hereunder.
(c) Each Underwriter severally agrees that it will indemnify and hold
harmless the Offerors, their officers, directors and Trustees, and each of them,
and each person, if any, who controls the Offerors within the meaning of Section
15 of the 1933 Act, against any loss, expense, claim, damage or liability to
which it or they may become subject, under the 1933 Act or otherwise, insofar as
such loss, expense, claim, damage or liability (or actions in respect thereof)
arises out of or is based on any untrue
-28-
statement or alleged untrue statement of any material fact contained in the
Registration Statement, the Prospectus, any related preliminary prospectus, or
any amendment or supplement to any thereof, or arises out of or is based upon
the omission or alleged omission to state therein any material fact required to
be stated therein or necessary to make the statements therein not misleading, in
each case to the extent, and only to the extent, that such untrue statement or
alleged untrue statement or omission or alleged omission was made in any such
documents in reliance upon, and in conformity with, written information
specified in Schedule B hereto furnished to the Trust or the Company by any
Underwriter through Xxxxxxx Xxxxx expressly for use in any such document; and,
except as hereinafter in this Section provided, each Underwriter agrees to
reimburse the Offerors, their officers, directors and Trustees, and each of
them, and each person, if any, who controls the Offerors within the meaning of
Section 15 of the 1933 Act, for any reasonable legal or other expenses incurred
by it or them in connection with investigating or defending any such loss,
expense, claim, damage or liability.
(d) Upon receipt of notice of the commencement of any action against an
indemnified party, the indemnified party shall, with reasonable promptness, if a
claim in respect thereof is to be made against an indemnifying party under its
agreement contained in this Section 9, notify such indemnifying party in writing
of the commencement thereof; but the omission so to notify an indemnifying party
shall not relieve it from any liability which it may have to the indemnified
party otherwise than under its agreement contained in this Section 9. In the
case of any such notice to an indemnifying party, it shall be entitled to
participate at its own expense in the defense, or if it so elects, to assume the
defense, of any such action, but, if it elects to assume the defense, such
defense shall be conducted by counsel chosen by it and satisfactory to the
indemnified party and to any other indemnifying party, defendant in the suit.
In the event that any indemnifying party elects to assume the defense of any
such action and retain such counsel, the indemnified party shall bear the fees
and expenses of any additional counsel retained by it. No indemnifying party
shall be liable in the event of any
-29-
settlement of any such action effected without its consent except as provided in
Section 9(f) hereof. Each indemnified party agrees promptly to notify each
indemnifying party of the commencement of any litigation or proceedings against
it in connection with the issue and sale of the Securities.
(e) If any Underwriter or person entitled to indemnification by the terms
of subsection (a) of this Section 9 shall have given notice to the Offerors of a
claim in respect thereof pursuant to Section 9(d) hereunder, and if such claim
for indemnification is thereafter held by a court to be unavailable for any
reason other than by reason of the terms of this Section 9 or if such claim is
unavailable under controlling precedent, such Underwriter or person shall be
entitled to contribution from the Offerors to liabilities and expenses, except
to the extent that contribution is not permitted under Section 11(f) of the 1933
Act. In determining the amount of contribution to which such Underwriter or
person is entitled, there shall be considered the relative benefits received by
such Underwriter or person and the Offerors from the offering of the Securities
(taking into account the portion of the proceeds of the offering realized by
each), the Underwriter or person's 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 Offerors and
the Underwriters 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
Underwriters were treated as one entity for such purpose).
(f) No indemnifying party shall, without the prior written consent of the
indemnified parties, settle or compromise or consent to the entry of any
judgment with respect to any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim
whatsoever in respect of which indemnification or contribution could be sought
under this Section 9 (whether or not the indemnified parties are actual or
potential parties thereto), unless such settlement,
-30-
compromise or consent (i) includes an unconditional release of each indemnified
party and all liability arising out of such litigation, investigation,
proceeding or claim, and (ii) does not include a statement as to or an admission
of fault, culpability or the failure to act by or on behalf of any indemnified
party.
(g) The indemnity and contribution provided for in this Section 9 and the
representations and warranties of the Company, the Trust and the several
Underwriters set forth in this Agreement shall remain operative and in full
force and effect regardless of (i) any investigation made by or on behalf of any
Underwriter or any person controlling any Underwriter, the Company, its
directors or officers, the Trust or any person controlling the Trust or any
Trustee, (ii) acceptance of any Preferred Securities and payment therefor under
this Agreement, and (iii) any termination of this Agreement.
10. Default of Underwriters.
-----------------------
If one or more of the Underwriters shall fail at the Closing Date to
purchase the Preferred Securities which it or they are obligated to purchase
under this Agreement (the "Defaulted Securities"), Xxxxxxx Xxxxx shall have the
right, within 24 hours thereafter, to make arrangements for one or more of the
non-defaulting Underwriters, or any other underwriters, to purchase all, but not
less than all, of the Default Securities in such amounts as may be agreed upon
and upon the terms herein set forth in this Agreement. If, however, Xxxxxxx
Xxxxx shall not have completed such arrangements within such 24-hour period,
then: (i) if the number of Defaulted Securities does not exceed 10% of the
number of Preferred Securities to be purchased on such date, each of the non-
defaulting Underwriters shall be obligated, severally and not jointly, to
purchase the full amount thereof in the proportions that their respective
underwriting obligations hereunder bear to the underwriting obligations of all
non-defaulting Underwriters, or (ii) if the number of Defaulted Securities
exceeds 10% of the number of Securities to be purchased on such date, this
Agreement shall terminate without liability on the part of any non-defaulting
Underwriter. In the event of any such default
-31-
which does not result in a termination of this Agreement, either Xxxxxxx Xxxxx
or the Company shall have the right to postpone the Closing Date for a period
not exceeding seven days in order to effect any required changes in the
Registration Statement or Prospectus or in an any other documents or
arrangements, and the Offerors will promptly file any amendments to the
Registration Statement or supplements to the Prospectus which may thereby be
necessary. As used in this Agreement, the term "Underwriter" includes for all
purposes of this Agreement any person substituted for an Underwriter under this
Section 10.
Nothing in this Section 10 shall relieve an Underwriter from liability for
its default.
11. Survival of Certain Representations and Obligations.
---------------------------------------------------
The respective indemnities, agreements, representations and warranties of
the Company and the Trust and of or on behalf of the Underwriters 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 Underwriter or the Offerors or any of their
respective officers, directors, Trustees or any controlling person, and will
survive delivery of and payment for the Preferred Securities. If for any reason
the purchase of the Preferred Securities by the Underwriters is not consummated,
the Company shall remain responsible for the expenses to be paid or reimbursed
by it pursuant to Sections 5(c) and 6, and the respective obligations of the
Company, the Trust and the Underwriters pursuant to Section 9 hereof shall
remain in effect.
12. Notices.
-------
The Offerors shall be entitled to act and rely upon any statement, request,
notice or agreement on behalf of each of the Underwriters if the same shall have
been made or given by the Underwriters jointly or by Xxxxxxx Xxxxx. All
statements, requests, notices, consents and agreements hereunder shall be in
writing, or by telegraph subsequently
-32-
confirmed in writing, and, if to the Company or the Trust, shall be sufficient
in all respects if delivered or mailed to the Company, attention of its
Treasurer, at Xxx Xxxxx Xxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxxxxx 00000, and, if to
an Underwriter, shall be sufficient in all respects if delivered or mailed to
x/x Xxxxxxx Xxxxx, Xxxxxxx Xxxxx World Headquarters, North Tower, World
Financial Center, New York, New York 10281-1201, attention of Xxxxxxx Xxxxxxx,
Managing Director; provided, however, that any notice to an Underwriter pursuant
to Section 9 hereof will also be delivered or mailed to such Underwriter at the
address, if any, of such Underwriter furnished to the Company in writing for the
purpose of communications hereunder.
13. Parties in Interest.
-------------------
This Agreement shall each inure solely to the benefit of the Company, the
Trust and the Underwriters and, to the extent provided in Section 9 hereof, to
any person who controls any Underwriter, to the officers and directors of the
Company and the Trust and the Trustees of the Trust, and to any person who
controls the Company or the Trust, and their respective successors. No other
person, partnership, association or corporation shall acquire or have any right
under or by virtue of this Agreement. The term "successor" shall not include
any assignee of an Underwriter (other than a person substituted for an
Underwriter under Section 10 hereof or one who shall acquire all or
substantially all of an Underwriter's business and properties), nor shall it
include any purchaser of Securities from any Underwriter merely because of such
purchase.
14. Applicable Law.
--------------
This Agreement shall be governed by, and construed in accordance with, the
laws of the State of New York.
-33-
15. Counterparts.
------------
This Agreement may be executed by any one or more of the parties hereto in
any number of counterparts, each of which shall be deemed to be an original, but
all such respective counterparts shall together constitute one and the same
instrument.
Please confirm that the foregoing correctly sets forth the agreement
between us by signing in the space provided below for that purpose, whereupon
this letter shall constitute a binding agreement between the Company and the
Trust and the several Underwriters in accordance with its terms.
Yours very truly,
PENNSYLVANIA POWER & LIGHT COMPANY
By:________________________________
Name: Xxxx X. Xxxxxx
Title: Vice President - Finance
PP&L CAPITAL TRUST
By:________________________________
Name:
Title: Trustee
___________________________________
By:________________________________
Name:
Title: Trustee
-34-
The foregoing Underwriting Agreement is
hereby confirmed and accepted as of the date
first above written.
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX INCORPORATED
By XXXXXXX XXXXX & CO.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
By:_______________________________
Name: Xxxxxx X. Xxxxx
Title: Vice President
For itself and each of the other
Underwriters named in Schedule A hereto.
-35-
SCHEDULE A
NUMBER
OF
NAME OF UNDERWRITER SECURITIES
------------------- ----------
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated..........................
..................
..................
..................
..................
..................
..................
..................
..................
==========
Total.................................. 4,000,000
-36-
SCHEDULE B
----------
Certain Information Regarding The
Securities And The Sale Thereof
-------------------------------
1. Title of Securities: ____% Trust Originated Preferred Securities/SM/
-------------------
("TOPrS"/SM/)
2. (a) Title of Senior Subordinated Debentures:
---------------------------------------
___ % Junior
Subordinated Deferrable Interest Debentures due ___, 2027
(b) Aggregate Principal Amount of Junior Subordinated Debentures: $______.
------------------------------------------------------------
4. Liquidation Amount per Security: $25
-------------------------------
5. Initial Public Offering Price per Security: $25 plus accrued
------------------------------------------
distributions, if any, from the date of issuance
6. Proceeds Per Security to be Paid to the Trust: $25, plus accrued
---------------------------------------------
distributions, if any, from the date of issuance
7. Compensation Payable to Underwriters: $_________
------------------------------------
8. Closing Date: _____________, 1997; 10:00 a.m. New York Time
------------
-37-
SCHEDULE C
----------
Information Represented and
Warranted by the Underwriters
Pursuant to Section 2(b) of
Underwriting Agreement.
-----------------------------
1. The first sentence in the last paragraph or the cover page of the
Prospectus (page 1).
2. The stabilization legend on page 2 of the Prospectus.
3. Under the caption "Underwriting" in the Prospectus, the following:
(a) The first paragraph of text following the table.
(b) The last two sentences in the fourth paragraph following the table.
(c) The second sentence in the fifth paragraph following the table.
(d) The twelfth paragraph following the table.
-38-
SCHEDULE D
----------
Additional Matters to be Included
in Accountants' Comfort Letter Pursuant to
Section 7(a)(iv) of Underwriting Agreement
__________________________________________
PROSPECTUS CAPTION PAGE ITEMS
----------------------- ---- --------------------------
"SELECTED FINANCIAL 14 "Ratio of Earnings to
DATA" Combined Fixed Charges
and Preferred Dividend
Requirements" and
supporting calculations
shown on Exhibit 12.2 too
the Registration
Statement; and
"CAPITALIZATION" 15 Dollar amounts and
percentages in "As
Adjusted" and
"Percentage" columns
after giving effect to
footnote (1) thereto.
FORM 10-K CAPTION PAGE ITEMS
----------------------- ---- --------------------------
"REVIEW OF THE 26 Table with respect to
FINANCIAL CONDITION increases in total
AND RESULTS OF operating revenues
OPERATIONS OF PP&L
RESOURCES, INC. AND
PENNSYLVANIA POWER &
LIGHT COMPANY --
"Operating Revenues"
"REVIEW OF THE 32 The Company's actual
FINANCIAL CONDITION construction expenditures
AND RESULTS OF during the year ended
OPERATIONS OF PP&L 1996.
RESOURCES, INC. AND
PENNSYLVANIA POWER &
LIGHT COMPANY --
Capital Expenditure
Requirements"
-39-
"REVIEW OF THE 34 The Company's ratio
FINANCIAL CONDITION of pre-tax income to
AND RESULTS OF interest charges for 1995
OPERATIONS OF PP&L and 1996.
RESOURCES, INC. AND
PENNSYLVANIA POWER &
LIGHT COMPANY --
"Financial Indicators"
(Third sentence)
-40-
