EXHIBIT 1.1
NIAGARA MOHAWK POWER CORPORATION
SENIOR DEBT SECURITIES UNDERWRITING AGREEMENT
New York, New York
September 25, 2001
Xxxxxxx Xxxxx Xxxxxx Inc.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
as Representative of the several underwriters
named in Schedule I to this Underwriting
Agreement (this "Agreement")
Dear Ladies and Gentlemen:
Niagara Mohawk Power Corporation, a New York corporation (the "Company"),
proposes to sell to the underwriters named in Schedule I hereto (the
"Underwriters") for whom you are acting as the representative (the
"Representative"), and the Underwriters hereby agree, severally and not jointly,
to purchase from the Company, the Company's Senior Debt Securities of the
designations, with the terms, the initial public offering price, the purchase
prices to the Underwriters and in the aggregate principal amounts specified in
Schedule I hereto (the "Securities") to be issued under its Indenture from the
Company to The Bank of New York, as trustee (the "Trustee"), as to be further
supplemented and amended by a supplemental indenture relating to the Securities
(such Indenture as so supplemented and amended and as to be so supplemented and
amended being hereinafter referred to as the "Indenture"), and Schedule I hereto
sets forth the date, time and manner of delivery of the Securities.
1. REPRESENTATIONS AND WARRANTIES BY THE COMPANY. The Company
represents and warrants to, and agrees with each Underwriter that:
(a) The Company meets the requirements for use of Form S-3 under the
Securities Act of 1933, as amended (the "Act") and has filed with the Securities
and Exchange Commission (the "Commission") a registration statement (with the
file number set forth on Schedule I hereto) on such Form, including a
prospectus, for the registration under the Act of the Securities, which
registration statement has become effective. Such registration statement and
prospectus may have been amended or supplemented from time to time prior to the
date of this Agreement. Any such amendment or supplement was or will be timely
filed with the Commission, and any such amendment has become effective. The
Company will file with the Commission a prospectus supplement (the "Prospectus
Supplement") relating to the Securities pursuant to Rule 424 under the Act.
Copies of such registration statement and prospectus, any such amendment or
supplement, the Prospectus Supplement and all documents incorporated by
reference therein which were filed with the Commission on or prior to the date
of this Agreement have been delivered to you. Such registration statement and
such prospectus or any prospectus used in place thereof pursuant to Rule 429
under the Act, as amended or supplemented prior to the date of this Agreement
and as supplemented by the Prospectus Supplement, are hereinafter called the
"Registration Statement," and the "Prospectus," respectively. Any reference
herein to
the Registration Statement or the Prospectus shall be deemed to refer to and
include the documents incorporated by reference therein pursuant to Item 12 of
Form S-3 which were filed under the Securities Exchange Act of 1934 (the
"Exchange Act") on or before the date of this Agreement, and any reference
herein to the terms "amend," "amendment" or "supplement" with respect to the
Registration Statement or the Prospectus shall be deemed to refer to and include
the filing of any document under the Exchange Act deemed to be incorporated by
reference therein after the date of this Agreement.
(b) (i) The Registration Statement, at the time it became effective,
any post-effective amendment thereto, at the time it became effective, the
Prospectus, at the date of this Agreement and at the Closing Date (as
hereinafter defined), any amendments thereof and supplements thereto and the
Indenture complied or will comply in all material respects with the Act, the
Trust Indenture Act of 1939 (the "Trust Indenture Act") and the Exchange Act and
the respective rules thereunder; (ii) the Registration Statement, at the time
and date it was declared effective by the Commission, did 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; and
(iii) and the Prospectus, at the date of this Agreement and at the Closing Date
(as hereinafter defined), did not and will not contain any untrue statement of a
material fact and did not and will omit to state a material fact necessary in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading; PROVIDED, HOWEVER, that the Company makes
no representations or warranties as to (A) that part of the Registration
Statement which shall constitute the Statement of Eligibility and Qualification
on Form T-1 (the "Form T-1") under the Trust Indenture Act of the Trustee or (B)
the information contained in or omitted from the Registration Statement or the
Prospectus or any amendment thereof or supplement thereto in reliance upon and
in conformity with information furnished in writing to the Company by or on
behalf of any Underwriter through the Representative specifically for inclusion
in the Prospectus as amended or supplemented.
(c) The documents incorporated by reference in the Prospectus, when
they were filed with the Commission or became effective, conformed in all
material respects to the requirements of the Act or the Exchange Act and the
rules and regulations of the Commission thereunder, and any documents so filed
and incorporated by reference subsequent to the date of this Agreement will,
when they are filed with the Commission, conform in all material respects to the
requirements of the Act and the Exchange Act, and the rules and regulations of
the Commission thereunder, and none of such documents includes or will include
any untrue statement of a material fact or omits or will omit to state any
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 such representation shall not apply to any
statements or omissions made in reliance upon and in conformity with information
furnished by an Underwriter through the Representative expressly for use in the
Prospectus as supplemented or amended.
(d) The accountants who have certified or shall certify the audited
financial statements incorporated by reference as parts of the Registration
Statement and the Prospectus are independent accountants as required by the Act
and the rules and regulations of the Commission thereunder.
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(e) The financial statements and information included or
incorporated by reference in the Registration Statement present fairly, in all
material respects, the financial position, results of operations and changes in
financial position of the Company at the respective dates and for the respective
periods indicated, all in conformity with generally accepted accounting
principles applied on a consistent basis throughout the periods involved except
as therein stated. The Company has no material contingent obligation which is
not disclosed in the Registration Statement and Prospectus.
(f) Subsequent to the respective dates as of which information is
given in the Registration Statement and the Prospectus, except as set forth or
contemplated in the Registration Statement and the Prospectus, (1) there has not
been any material adverse change on the condition (financial or otherwise),
earnings, business or properties of the Company, whether or not arising from
transactions in the ordinary course of business and (2) there has been no
transaction entered into by the Company which is material to the Company, other
than transactions in the ordinary course of business.
(g) All the outstanding shares of capital stock of the Company have
been duly authorized and validly issued and are fully paid and non-assessable.
(h) The Securities have been duly authorized by the Company, and,
when issued and authenticated in the manner provided for in the Indenture and
delivered against payment of the required consideration therefor, will
constitute valid and legally binding obligations of the Company entitled to the
benefits of the Indenture.
(i) The Securities conform in all material respects to the
description thereof in the Prospectus.
(j) Each of the Company and its material subsidiaries has been duly
incorporated and is a validly existing corporation in good standing under the
laws of the jurisdiction in which it is chartered or organized; each of the
Company and its material subsidiaries holds all material licenses, certificates
and permits from governmental authorities necessary for the conduct of its
business; and the Company and each such material subsidiary has the corporate
power and authority to own its properties and conduct its business as described
in the Prospectus.
(k) Neither the Company nor any of its material subsidiaries is in
violation of its respective certificate of incorporation or by-laws or in
default in the performance of any obligation, agreement, covenant or condition
contained in any indenture, loan agreement, mortgage, lease or other agreement
or instrument that is material to the Company and its material subsidiaries,
taken as a whole, to which the Company or any of its material subsidiaries is a
party or by which the Company or any of its material subsidiaries or their
respective property is bound, except for such violation which, singly or in the
aggregate, would not have a material adverse effect on the condition (financial
or otherwise), earnings, business or properties of the Company and its
subsidiaries taken as a whole.
(l) The Indenture (A) has been duly qualified under the Trust
Indenture Act, the Company has duly authorized the Indenture and, when the
Company has duly executed and
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delivered the Indenture (assuming the due authorization, execution and delivery
thereof by the Trustee) it will be a valid and binding agreement of the Company,
enforceable against it in accordance with its terms, except as the
enforceability thereof may be limited (i) by the effect of bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium or other similar
laws now or hereafter in effect relating to or affecting the rights and remedies
of creditors generally and (ii) by the effect of general principles of equity,
whether enforcement is considered in a proceeding in equity or at law, and the
discretion of the court before which any proceedings may be brought; and (B)
conforms in all material respects to the description thereof in the Prospectus.
(m) Neither the issuance or sale of the Securities, nor the
consummation of any other of the transactions herein contemplated, nor the
fulfillment of the terms hereof, will conflict with, result in a breach of any
of the terms or provisions of, or constitute a default under, the certificate of
incorporation or the by-laws of the Company or any of its material subsidiaries,
any indenture, or other agreement or instrument to which the Company or any of
its material subsidiaries is a party or by which it or they is bound or, to the
best knowledge of the Company, any law, order or regulation applicable to the
Company of any court, regulatory body, administrative agency or governmental
body having jurisdiction over the Company or any of its material subsidiaries or
any of their assets, properties or operations.
(n) The Company has filed a petition with the Public Service
Commission of the State of New York ("PSC") with respect to the issue and sale
of the Securities. The PSC has authorized or is expected to authorize the issue
and sale thereof on or prior to the Closing Date (as hereinafter defined) but
upon the express condition that the Company shall file with the PSC for its
consideration a copy of this Agreement and a statement setting forth (i) the
interest rate for the Securities, (ii) any initial public offering price
thereof, (iii) the price to be paid to the Company for the Securities, (iv) any
underwriting commissions, (v) any sinking fund or other mandatory redemption
provisions and (vi) any redemption prices and dates with respect to redemption
of the Securities at the option of the Company. No other consent, waiver,
approval, authorization or order of, or filing, registration, qualification,
license or permit of or with, any court or governmental agency, body or
administrative agency [or other person] is required for the execution, delivery
and performance by the Company of this Agreement, the issuance and sale of the
Securities, and the consummation of the transactions contemplated hereby, except
(i) such as are required under state securities or Blue Sky laws and
regulations, and (ii) such as to which the failure to be obtained or made would
not reasonably be expected, either individually or in the aggregate, to have a
material adverse effect on the condition (financial or otherwise), earnings,
business or properties of the Company and its subsidiaries taken as a whole.
(o) The Company and each material subsidiary of the Company have
good and valid title to all or substantially all of their permanent fixed
properties (including the specified undivided interests in generating units and
plants referred to in the Prospectus), except as otherwise indicated in the
Prospectus, subject only to the respective liens of the indentures securing its
mortgage debt.
(p) The Company has all requisite corporate power and authority to
execute, deliver and perform its obligations under this Agreement and to
consummate the transactions contemplated hereby, including, without limitation,
the corporate power and authority to issue, sell and deliver the Securities as
provided herein.
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(q) This Agreement has been duly authorized and validly executed by
the Company.
(s) Except as disclosed in the Prospectus and subject to such
qualifications as may be set forth therein, neither the Company nor any of its
subsidiaries has violated any foreign, federal, state or local law or regulation
relating to the protection of human health and safety, the environment or
hazardous or toxic substances or wastes, pollutants or contaminants
("Environmental Laws"), any provisions of the Employee Retirement Income
Security Act of 1974, as amended, or any provisions of the Foreign Corrupt
Practices Act or the rules and regulations promulgated thereunder, except for
such violation which, singly or in the aggregate, would not have a material
adverse effect on the condition (financial or otherwise), earnings, business or
properties of the Company and its subsidiaries taken as a whole.
(t) Except as disclosed in the Prospectus and subject to such
qualifications as may be set forth therein, there are no costs or liabilities
associated with Environmental Laws (including, without limitation, any capital
or operating expenditures required for clean-up, closure of properties or
compliance with Environmental Laws or any authorization, any related constrains
on operating activities and any potential liabilities to third parties) which
would singly or in the aggregate, have a material adverse effect on the
condition (financial or otherwise), earnings, business or properties of the
Company and its subsidiaries taken as a whole.
2. PURCHASE AND SALE. Subject to the terms and conditions and in
reliance upon the representations and warranties herein set forth, the Company
agrees to sell to you and each other Underwriter, and you and each other
Underwriter agree, severally and not jointly, to purchase from the Company, at
the purchase price set forth in Schedule I hereto, the respective principal
amounts of the Securities set forth opposite your respective names in Schedule I
hereto and Schedule II hereto sets forth the date, time and manner of delivery
of the Securities.
Upon authorization by the Representative of the release of the Securities,
the several Underwriters propose to offer the Securities for sale upon the terms
and conditions set forth in the Prospectus.
3. DELIVERY AND PAYMENT. Delivery of and payment for the Securities
shall be made at 10:00 a.m., New York City time, on September 28, 2001 (or such
other date and time not later than three business days thereafter as the
Representative and the Company shall designate), which date and time may be
postponed by agreement between the Representative and the Company (such date and
time being herein called the "Closing Date"). The Securities shall be in
definitive form and shall be registered in such names and in such authorized
denominations as the Representative may request not less than forty-eight hours
in advance of the Closing Date, and shall be delivered by or on behalf of the
Company to the Representative for the account of such underwriter, against
payment by such underwriter or on its behalf of the purchase price therefor by
wire transfer of federal (same day) funds to the account specified by the
Company to the Representative at least forty-eight hours in advance of the
Closing Date. Delivery of the Securities shall be made through the facilities of
The Depository Trust Company unless the Representative shall otherwise instruct.
4. AGREEMENTS. The Company agrees with each of the several Underwriters
that:
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(a) The Company will cause the Prospectus Supplement to be filed or
transmitted for filing, in a form approved by the Representative, pursuant to
Rule 424 under the Act and will notify you promptly of such filing or mailing.
During the period for which a prospectus relating to the Securities is required
to be delivered under the Act, the Company will promptly advise the
Representative (i) when any amendment to the Registration Statement shall have
become effective, (ii) when any subsequent supplement to the Prospectus has been
filed or transmitted for filing, (iii) of any request by the Commission for any
amendment of or supplement to the Registration Statement or the Prospectus or
for any additional information, (iv) of the issuance by the Commission of any
stop order suspending the effectiveness of the Registration Statement or the
institution or threatening of any proceedings for that purpose, and (v) of the
receipt by the Company of any notification with respect to the suspension of the
qualification of the Securities for sale in any jurisdiction or the initiation
or threatening of any proceeding for such purpose. The Company will use its best
efforts to prevent the issuance of any such stop order and, if issued, to obtain
as soon as possible the withdrawal thereof. The Company will not file any
amendment to the Registration Statement or supplement to the Prospectus (other
than any prospectus supplement relating to the offering of securities registered
under the Registration Statement other than the Securities and permitted by
Section 4(g) hereof, or any document required to be filed under the Exchange Act
which upon filing is deemed to be incorporated by reference in the Registration
Statement or Prospectus) unless the Company has furnished to you a copy for your
review prior to filing and will not file any such proposed amendment or
supplement to which you reasonably object after receiving a reasonable notice
from the Representative thereof. The Company will furnish to you prior to the
filing thereof a copy of any such prospectus supplement and any document which
upon filing is deemed to be incorporated by reference in the Registration
Statement or Prospectus.
(b) If, at any time when a prospectus relating to the Securities is
required to be delivered under the Act, any event occurs as a result of which
the Prospectus as then amended or supplemented would include any 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 shall be necessary at any time to amend or
supplement the Prospectus to comply with the Act or the Exchange Act or the
respective rules thereunder, the Company promptly will (1) notify the
Representative of such event, (2) prepare and file with the Commission, subject
to paragraph (a) of this Section 4, an amendment or supplement that will correct
such statement or omission or an amendment or supplement that will effect such
compliance and (3) supply any supplemented Prospectus to the Representative in
such quantities as they may reasonably request.
(c) The Company will make generally available to its security
holders and to the Representative as soon as practicable, but in any event not
later than eighteen months after the effective date of the Registration
Statement (as defined in Rule 158(c) under the Act), an earning statement (which
need not be audited) of the Company and its subsidiaries, for a twelve-month
period beginning after the date of the Prospectus Supplement filed pursuant to
Rule 424 under the Act, which will satisfy the provisions of Section 11(a) of
the Act.
(d) The Company has previously furnished to the Representative a
signed copy of the Registration Statement as originally filed and of each
amendment thereto, including the statement on Form T-1 of the Trustee and all
powers of attorney, consents and exhibits filed
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therewith (other than exhibits incorporated by reference), and will deliver to
the Representative conformed copies of the Registration Statement, the
Prospectus (including all documents incorporated by reference therein) and, so
long as delivery of a prospectus by an Underwriter or dealer may be required by
the Act, all amendments of and supplements to such documents, in each case as
soon as available and in such quantities as the Representative may reasonably
request.
(e) The Company will furnish such information, execute such
instruments and take such action as may be required to qualify the Securities
for sale under the laws of such jurisdictions as the Representative may
designate and will maintain such qualifications in effect so long as required
for the distribution of the Securities; PROVIDED, HOWEVER, that the Company
shall not be required to qualify to do business in any jurisdiction where it is
not now so qualified or to take any action which would subject it to general or
unlimited service of process in any jurisdiction where it is not now so subject.
(f) So long as the Securities are outstanding, the Company will
furnish (or cause to be furnished) to the Representative, upon request, copies
of (i) all reports to stockholders of the Company and (ii) all reports and
financial statements filed with the Commission or any national securities
exchange.
(g) During the period beginning from the date of this Agreement and
continuing to and including the earlier of (i) the termination of trading
restrictions on the Securities, as notified to the Company by the
Representative, or (ii) the thirtieth day after the Closing Date for the
Securities, the Company shall not offer, sell, contract to sell or otherwise
dispose of any debt securities of the Company (except under prior contractual
commitments which have been disclosed to you), without the prior written consent
of the Representative, which consent shall not be unreasonably withheld.
5. EXPENSES. Whether or not the transactions contemplated hereunder are
consummated or this Agreement is terminated, the Company will pay all costs and
expenses incident to the performance of the obligations of the Company
hereunder, including, without limiting the generality of the foregoing, all
cost, taxes and expenses incident to the issue and delivery of the Securities to
the Underwriters, all fees and expenses of the Company's counsel and
accountants, all costs and expenses incident to the preparing, printing and
filing of the Registration Statement (including all exhibits thereto), the
Prospectus and any amendments thereof or supplements thereto, the expenses in
connection with the qualification of the Securities under securities laws in
accordance with the provisions of subparagraph (e) of Section 4 hereof,
including filing fees and the fees and disbursements of counsel for the
Underwriters in connection therewith, and the rating of the Securities, and all
costs and expenses of the printing and distribution of all documents in
connection with this underwriting. Except as provided in this Section 5 and
Section 8 hereof, the Underwriters will pay all their own costs and expenses,
including the fees of their counsel and any advertising expenses in connection
with any offer they may make.
6. CONDITIONS TO THE OBLIGATIONS OF THE UNDERWRITERS. The obligations
of the Underwriters to purchase the Securities shall be subject to the accuracy
of the representations and warranties on the part of the Company contained
herein as of the date hereof and the Closing
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Date, to the accuracy of the statements of Company officers made in any
certificates given pursuant to the provisions hereof, to the performance by the
Company of its obligations hereunder and to the following additional conditions:
(a) No stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceedings for that purpose shall have
been instituted or, to the knowledge of the Company or the Representative,
threatened.
(b) On the date hereof through the Closing Date (i) there shall not
have been any decrease in the rating of any of the Company's debt securities by
any "nationally recognized statistical rating organization" (as defined for the
purposes of Rule 436(g) under the Act) and (ii) no such organization shall have
officially communicated to the Company that it has under surveillance or review,
with possible negative implications, its rating of any of the Company's debt
securities.
(c) The Company shall furnish to the Representative opinions,
addressed to the Underwriters and dated the Closing Date, of the Company's
General Counsel to the effect that (i) the Company and each of its material
subsidiaries has been duly incorporated and is in good standing in the
jurisdiction in which it is chartered or organized, with all requisite corporate
power and authority to own or lease and operate its properties and to carry on
its own business as now conducted and as described in the Prospectus; (ii) no
consent, waiver, approval, authorization or order of, or filing, registration,
qualification, license or permit of or with, any Federal or New York State court
or governmental agency, body or administrative agency is required for the
execution, delivery and performance by the Company of this Agreement and the
Indenture, the issuance and sale of the Securities, and the consummation of the
transactions contemplated thereby, except (a) such as have been obtained and
made under the Act and the Trust Indenture Act and from the PSC under a
Financing Order granting consent to the Company's issuance and sale of the
Securities, subject to the conditions contained in that Financing Order, or have
been obtained as described in the Prospectus, (b) such as are required under
state securities or Blue Sky laws and regulations, and (c) such as to which the
failure to be obtained or made would not reasonably be expected, either
individually or in the aggregate, to have a material adverse effect on the
condition (financial or otherwise), business or properties of the Company and
its subsidiaries, considered as a whole; (iii) to such counsel's knowledge,
there is no action, suit, investigation, litigation or proceeding affecting the
Company or any of its subsidiaries pending or threatened before any court,
governmental authority, governmental agency, regulatory body or arbitrator, of a
character required to be disclosed but not adequately disclosed in the
Prospectus, that would be reasonably likely to have a material adverse effect on
the condition (financial or otherwise), business or properties of the Company
and its subsidiaries, considered as a whole; and (iv) to such counsel's
knowledge, the Company's execution of this Agreement and the Indenture and the
issuance and sale of the Securities would neither contravene the Atomic Energy
Act of 1954 (the "AEA") nor the regulations of the Nuclear Regulatory
Commission, or NRC, in 10 Code of Federal Regulations, Chapter I, nor would such
actions require any application for approval by the NRC; PROVIDED, that as to
enforceability of the Company's obligations under this Agreement, the Indenture
and the Securities is concerned, such counsel expresses no opinion except for
those matters specifically set forth in (ii)(a) and (iv), as to bankruptcy,
insolvency, reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors' rights.
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(d) The Company shall furnish to the Representative opinions,
addressed to the Underwriters and dated the Closing Date, of Xxxxxxxx &
Xxxxxxxx, counsel for the Company, to the effect that (i) the Company has been
duly incorporated and is an existing corporation in good standing under the laws
of the State of New York; (ii) the Indenture has been duly authorized, executed
and delivered by the Company and duly qualified under the Trust Indenture Act of
1939; the Securities have been duly authorized, executed, authenticated, issued
and delivered; and the Indenture and the Securities constitute valid and legally
binding obligations of the Company enforceable in accordance with their terms,
subject to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to or affecting
creditors' rights and to general equity principles; (iii) all regulatory
consents, authorizations, approvals and filings required to be obtained or made
by the Company under the Federal laws of the United States and the laws of the
State of New York for the issuance, sale and delivery of the Securities by the
Company to the Underwriters have been obtained or made; PROVIDED that such
counsel will express no opinion as to any such regulatory consents,
authorizations, approvals or filings arising out of, relating to, or required to
be taken pursuant to, those regulatory regimes that govern the Company in its
capacity as an electric and gas utility and as an operator, owner, or operator
and owner of nuclear powered generating facilities, including the New York
Public Service Law, the Federal Power Act, the Public Utility Holding Company
Act of 1935, as amended (the "1935 Act"), the AEA and the rules and regulations
of the PSC, the NRC, and, solely with respect to jurisdiction granted by the
1935 Act, the Commission, or any Blue Sky or state securities laws or
regulations; (iv) this Agreement has been duly authorized, executed and
delivered by the Company; (v) the issuance and sale of the Securities in
accordance with the Indenture and the sale of the Securities to the Underwriters
pursuant to the Underwriting Agreement do not, and the performance of the
Company of its obligations under the Indenture, the Underwriting Agreement and
the Securities will not, (A) violate the Company's Certificate of Incorporation
or By-Laws or (B) result in a default under or breach of any indenture or other
agreement or undertaking of the Company specified in such counsel's opinion and
acceptable to counsel for the Underwriters; PROVIDED that insofar as performance
by the Company of its obligations under the Indenture, this Agreement and the
Securities is concerned, such counsel will express no opinion under this
subparagraph (d) as to bankruptcy, insolvency, reorganization, moratorium and
similar laws of general applicability relating to or affecting creditors' rights
and to general equity principles; (vi) the Registration Statement, as of its
effective date, and the Prospectus, as of the date of the Prospectus Supplement,
appear on their face to be appropriately responsive in all material respects
relevant to the offering of the Securities, to the requirements of the Act, the
Trust Indenture Act and the applicable rules and regulations of the Commission
thereunder; and (vii) such counsel has no reason to believe that, insofar as is
relevant to the offering of the Securities, any part of the Registration
Statement, when such part became effective, contained any untrue statement of a
material fact or omitted to state a material fact necessary to make the
statements therein not misleading or that the Prospectus, as of the date of the
Prospectus Supplement and as of the Closing Date, contained or contains any
untrue statement of a material fact or omitted 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 for financial statements and
other financial data included or incorporated by reference therein as to which
such counsel need express no opinions).
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(e) The Representative shall receive from counsel for the
Underwriters such opinion or opinions dated the Closing Date with respect to the
validity of the Securities, the Registration Statement, the Prospectus and other
related matters as the Representative may reasonably require, and the Company
shall have furnished to such counsel such documents as they reasonably request
for the purpose of enabling them to pass upon such matters.
(f) The Company shall furnish to the Representative a certificate of
a Vice President, the Treasurer or the Controller of the Company and a Vice
President, the Assistant Controller or the Assistant Treasurer of the Company,
dated the Closing Date, to the effect that the signers of such certificate have
carefully examined the Registration Statement, the Prospectus and this Agreement
and that:
(i) the representations and warranties of the Company in this
Agreement are true and correct on and as of the Closing Date with the same
effect as if made on the Closing Date, and the Company has complied with
all the agreements and satisfied all the conditions on its part to be
performed or satisfied at or prior to the Closing Date;
(ii) no stop order suspending the effectiveness of the
Registration Statement has been issued, and no proceedings for that
purpose have been instituted, or, to their knowledge, threatened; and
(iii) the Registration Statement, as of the later of the date it
became effective or the date of filing of the Company's most recent Annual
Report on Form 10-K, does not contain any untrue statement of a material
fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein, not misleading; the Prospectus,
including any supplements or amendments thereto and the documents
incorporated by reference therein, 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, in the light of the
circumstances under which they were made, not misleading; and since the
effective date of the Registration Statement there has not occurred any
event required to be set forth in an amended or supplemented prospectus
which has not been so set forth and there has been no document required to
be filed under the Exchange Act and the rules and regulations thereunder,
which would be deemed to be incorporated by reference in the Prospectus,
which has not been so filed.
(g) The Representative (i) shall have received, at or prior to the
time of execution of this Agreement, a letter to the Board of Directors of the
Company and the Underwriters dated the date of such delivery and (ii) shall
receive at the Closing Date, a letter dated the date of delivery thereof from
the independent accountants of the Company who have certified the financial
statements of the Company included or incorporated by reference in the
Registration Statement stating that (1) with respect to the Company and its
subsidiaries they are independent accountants within the meaning of the Act and
the applicable published rules and regulations thereunder; (2) in their opinion
the unaudited consolidated financial statements of the Company and subsidiary
companies included or incorporated by reference in the Registration Statement
and examined by such firm comply as to form in all material respects with the
applicable accounting requirements of the Act and the published rules and
regulations thereunder; (3)(A) on the basis of the following procedures (but not
an examination in
10
accordance with generally accepted auditing standards), and a reading of the
minutes of meetings of the Board of Directors and stockholders of the Company
and its subsidiaries since the date of the last audited Balance Sheet as set
forth in the minute books through a specified date not more than five days prior
to the date of delivery of such letter, (B) performance of the procedures
specified by the American Institute of Certified Public Accountants for a review
of interim financial information as described in SAS 71, INTERIM FINANCIAL
INFORMATION, on the unaudited condensed consolidated interim financial
statements of the Company and its subsidiaries as incorporated by reference in
the Registration Statement and the Prospectus, (C) if applicable, a reading of
the latest available unaudited interim financial data and (D) inquiries of
certain officials of the Company who have responsibility for financial and
accounting matters; nothing has come to their attention which caused them to
believe that (x) the unaudited condensed consolidated interim financial
statements, incorporated by reference in the Registration Statement and the
Prospectus, do not comply as to form in all material respects with the
applicable accounting requirements of the Act and the published rules and
regulations thereunder; (y) any material modifications should be made to the
unaudited condensed consolidated interim financial statements, incorporated by
reference in the Registration Statement and the Prospectus, for them to be in
conformity with generally accepted accounting principles; and (z) on the basis
of inquiries of certain officials of the Company who have responsibilities for
financial and accounting matters and a reading of the minutes as stated above,
nothing has come to their attention which caused them to believe that there was
any change at the date of the latest available interim financial data and at a
specified date not more than five days prior to the date of delivery of such
letter in the capital stock, other than changes arising as a result of sales of
Common Stock under the Company's Dividend Reinvestment and Stock Purchase Plan
and Employee Savings Fund Plan, or long-term debt of the Company and its
consolidated subsidiaries as compared with amounts shown on the latest balance
sheet included or incorporated by reference in the Registration Statement, or
for the period from the date of the Company's latest balance sheet included or
incorporated by reference in the Registration Statement to the end of the
preceding calendar month for which balance sheet data is available, there were
any decreases, as compared with the corresponding period in the preceding year,
in consolidated operating revenues or net income, or any decreases in
unconsolidated capitalization, as compared with amounts shown on the latest
balance sheet included or incorporated by reference in the Registration
Statement, except in all instances for changes or decreases which the
Registration Statement discloses have occurred or may occur. The letters of such
independent accountants also shall be to the effect that they have carried out
certain specified procedures, not constituting an audit, with respect to certain
amounts, percentages and financial information which are derived from the
general accounting records of the Company, which appear or are incorporated by
reference in the Registration Statement and Prospectus and which are specified
by the Representative, and have compared such amounts, percentages and financial
information with the accounting records of the Company and have found them to be
in agreement.
(h) Subsequent to the respective dates as of which information is
given in the Registration Statement and the Prospectus, there shall not have
been any change or decrease specified in the letter or letters referred to in
paragraph (g) of this Section 6 which makes it impractical or inadvisable in the
judgment of the Representative to proceed with the public offering or the
delivery of the Securities as contemplated by the Prospectus.
11
(i) Prior to the Closing Date, the Company shall furnish to the
Representative such further information, certificates and documents as they may
reasonably request.
(j) The PSC shall have issued a written order or orders (the "PSC
Orders") authorizing the issuance by the Company of the Securities on the terms
and conditions herein set forth or contemplated and the PSC Orders shall remain
in full force and effect on the Closing Date.
If any of the conditions specified in this Section 6 shall not have been
fulfilled when and as required by this Agreement, or if any of the opinions and
certificates mentioned above or elsewhere in this Agreement shall not be in all
material respects satisfactory in form and substance to the Representative and
their counsel, this Agreement and all obligations of the Underwriters hereunder
may be canceled at, or at any time prior to, the Closing Date by the
Representative. Notice of such cancellation shall be given to the Company in
writing, or by telephone or telegraph confirmed in writing.
The documents required to be delivered by this Section 6 shall be
delivered at the office of Xxxxxxxx & Xxxxxxxx, counsel for the Company, at 000
Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, on the Closing Date.
7. CONDITIONS OF COMPANY'S OBLIGATIONS. The obligations of the Company
to sell and deliver the Securities are subject to the following conditions:
(a) Prior to the Closing Date, no stop order suspending the
effectiveness of the Registration Statement shall have been issued and no
proceedings for that purpose shall have been instituted or, to the knowledge of
the Company or the Representative, threatened.
(b) The PSC Orders shall on the Closing Date be in full force and
effect, permitting the issuance and sale of the Securities upon the terms and
conditions herein set forth or contemplated and containing no provision
unacceptable to the Company.
(c) The Underwriters shall have furnished to the Company completed
underwriters' questionnaires from each underwriter named in Schedule II hereto,
in form and substance satisfactory to counsel for the Company, which disclose no
relationship between any such underwriter, or its directors, officers or
partners, and the Company or the Trustee, or the directors, officers or partners
thereof, which would require, in the opinion of such counsel, an amendment of
the Form T-l filed by the Trustee and disqualification of the Trustee.
If any of the conditions specified in this Section 7 shall not have been
fulfilled, this Agreement and all obligations of the Company hereunder may be
canceled on or at any time prior to the Closing Date by the Company. Notice of
such cancellation shall be given to the Underwriters in writing or by telephone
or telegraph confirmed in writing.
8. REIMBURSEMENT OF UNDERWRITERS' EXPENSES. If the sale of the
Securities provided for herein is not consummated because any condition to the
obligations of the Underwriters set forth in Section 6 hereof is not satisfied,
because of any termination pursuant to Section 11 hereof or because of any
refusal, inability or failure on the part of the Company to perform any
agreement herein or comply with any provision hereof, other than by reason of a
default by any
12
of the Underwriters, the Company will reimburse the Underwriters severally
through the Representative upon demand for all out-of-pocket expenses (including
reasonable fees and disbursements of counsel) that shall have been reasonably
incurred by them in connection with the proposed purchase and sale of the
Securities.
9. INDEMNIFICATION. (a) The Company agrees to indemnify and hold
harmless each Underwriter and each person who controls any Underwriter within
the meaning of either the Act or the Exchange Act against any and all losses,
claims, damages or liabilities, joint or several, to which they or any of them
may become subject under the Act, the Exchange Act or other Federal or state
statutory law or regulation, at common law or otherwise insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or
are based upon any untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement or in any amendment thereof, or
arise out of or are based upon the omission or alleged omission to state therein
a material fact required to be stated therein, or arise out of or are based upon
any untrue statement or alleged untrue statement of a material fact contained in
the Prospectus or in any amendment thereof or supplement thereto, or the
omission or alleged omission to state therein 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, and agrees to
reimburse each such indemnified party, as incurred, for any legal or other
expenses reasonably incurred by them in connection with investigating or
defending any such loss, claim, damage, liability or action; PROVIDED, HOWEVER,
that the Company will not be liable in any such case to the extent that any such
loss, claim, damage or liability arises out of or is based upon any such untrue
statement or alleged untrue statement or omission or alleged omission made
therein in reliance upon and in conformity with written information furnished to
the Company by or on behalf of any Underwriter through the Representative
specifically for use in connection with the preparation thereof; and PROVIDED,
FURTHER, that such indemnity with respect to a prospectus included in the
Registration Statement or any amendment thereto prior to the supplementing
thereof with the Prospectus Supplement shall not inure to the benefit of any
Underwriter (or any person controlling such Underwriter) from whom the person
asserting any such loss, claim, damage or liability purchased the Securities
which are the subject thereof if such person did not receive a copy of the
Prospectus as amended or supplemented (but without the documents incorporated by
reference therein) at or prior to the confirmation of the sale of such
Securities to such person in any case where such delivery is required by the Act
and the untrue statement or omission of a material fact contained in the
Prospectus was corrected in the Prospectus as amended or supplemented provided
such corrected Prospectus was delivered promptly by the Company to the
Underwriters. This indemnity agreement will be in addition to any liability
which the Company may otherwise have.
(b) Each Underwriter severally and not jointly agrees to indemnify
and hold harmless the Company, each of its directors, each of its officers who
has signed the Registration Statement and each person, if any, who controls the
Company within the meaning of either the Act or the Exchange Act, to the same
extent as the foregoing indemnity from the Company to each Underwriter but only
with reference to written information furnished to the Company by or on behalf
of such Underwriter through the Representative specifically for use in the
preparation of the documents referred to in the foregoing indemnity, and agrees
to reimburse each such indemnified party for any legal or other expenses
reasonably incurred by them in connection with investigating or defending any
such loss, claim, damage, liability or action. This indemnity
13
agreement will be in addition to any liability which any Underwriter may
otherwise have. The Company acknowledges that the statements set forth under the
heading "Underwriting" in the first, second and fourth paragraphs under the
table and the third and fourth sentences of the fifth paragraph under the table
constitute the only information furnished in writing by or on behalf of the
several Underwriters for inclusion in the Prospectus.
(c) Promptly after receipt by an indemnified party under this
Section 9 of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying party
under this Section 9, notify the indemnifying party in writing of the
commencement thereof; but the failure to so notify the indemnifying party (i)
will not relieve it from liability under paragraph (a) or (b) above unless and
to the extent it did not otherwise learn of such action and such failure results
in the forfeiture by the indemnifying party of substantial rights and defenses
and (ii) will not, in any event, relieve the indemnifying party from any
obligations to any indemnified party other than the indemnification obligation
provided in paragraph (a) or (b) above. The indemnifying party shall be entitled
to appoint counsel of the indemnifying party's choice at the indemnifying
party's expense to represent the indemnified party in any action for which
indemnification is sought (in which case the indemnifying party shall not
thereafter be responsible for the fees and expenses of any separate counsel
retained by the indemnified party or parties except as set forth below);
PROVIDED, HOWEVER, that such counsel shall be satisfactory to the indemnified
party. Notwithstanding the indemnifying party's election to appoint counsel to
represent the indemnified party in an action, the indemnified party shall have
the right to employ separate counsel (including local counsel), and the
indemnifying party shall bear the reasonable fees, costs and expenses of such
separate counsel if (i) the use of counsel chosen by the indemnifying party to
represent the indemnified party would present such counsel with a conflict of
interest, (ii) the actual or potential defendants in, or targets of, any such
action include both the indemnified party and the indemnifying party and the
indemnified party shall have reasonably concluded that there may be legal
defenses available to it and/or other indemnified parties which are different
from or additional to those available to the indemnifying party, (iii) the
indemnifying party shall not have employed counsel satisfactory to the
indemnified party to represent the indemnified party within a reasonable time
after notice of the institution of such action or (iv) the indemnifying party
shall authorize the indemnified party to employ separate counsel at the expense
of the indemnifying party. An indemnifying party will not, without the prior
written consent of the indemnified parties, settle or compromise or consent to
the entry of any judgment with respect to any pending or threatened claim,
action, suit or proceeding in respect of which indemnification or contribution
may be sought hereunder (whether or not the indemnified parties are actual or
potential parties to such claim or action) unless such settlement, compromise or
consent includes an unconditional release of each indemnified party from all
liability arising out of such claim, action, suit or proceeding.
(d) In order to provide for just and equitable contribution in
circumstances in which the indemnification provided for in subparagraph (a) is
due in accordance with its terms but is for any reason unavailable from the
Company or insufficient to hold the Underwriters harmless in respect of any
losses, claims, damages or liabilities (or actions in respect thereof) referred
to therein, the Company and the Underwriters shall contribute to the aggregate
losses, claims, damages and liabilities (or actions in respect thereof) to which
the Company and one or more of the Underwriters may be subject, as a result of
such losses, claims, damages or liabilities (or actions in respect thereof), in
such proportion as is appropriate to reflect the relative fault of
14
the Company on the one hand and the Underwriters on the other in connection with
the statements or omissions which resulted in such losses, claims, damages or
liabilities (or actions in respect thereof), as well as any other equitable
considerations, including relative benefit. The relative fault shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Company on the one hand
or the Underwriters on the other and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The relative benefits received by the Company on the one hand and the
Underwriters on the other shall be deemed to be in the same proportion as the
total net proceeds from the offering of the Securities (before deducting
expenses) received by the Company bear to the total underwriting discounts and
commissions received by the Underwriters with respect to the offering of the
Securities, in each case as set forth in the table on the cover page of the
Prospectus Supplement. Notwithstanding the foregoing, no person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Company and the Underwriters agree that it
would not be just and equitable if contribution pursuant to this subparagraph
(d) were determined by pro rata allocation (even if the Underwriters were
treated as one entity for such purpose) or by any other method of allocation
which does not take account of the equitable considerations referred to above in
this subparagraph (d). The amount paid or payable by a party entitled to
contribution as a result of the losses, claims, damages or liabilities (or
actions in respect thereof) referred to above in this subparagraph (d) shall be
deemed to include any legal or other expenses reasonably incurred by such party
in connection with investigating or defending any such action or claim. The
Underwriters' obligations under this subparagraph (d) are several in proportion
to their respective underwriting obligations and not joint. Notwithstanding the
provisions of this Section 9, no Underwriter shall be required to contribute in
excess of the amount equal to the excess of (i) the total price at which the
Securities underwritten by it were offered to the public, over (ii) the amount
of any damages which such Underwriter has otherwise been required to pay by
reason of any such untrue or alleged untrue statement or omission or alleged
omission. For purposes of this subparagraph (d), each person, if any, who
controls an Underwriter within the meaning of either the Act or the Exchange Act
shall have the same rights to contribution as such Underwriter, and each person,
if any, who controls the Company within the meaning of either the Act or the
Exchange Act, each officer of the Company who shall have signed the Registration
Statement and each director of the Company shall have the same rights to
contribution as the Company, subject to the fourth sentence of this subparagraph
(d).
10. DEFAULT BY AN UNDERWRITER. If any one or more of the Underwriters
shall fail to purchase and pay for all of the Securities agreed to be purchased
by such Underwriter or Underwriters hereunder and such failure to purchase shall
constitute a default in the performance of its or their obligations under this
Agreement, the remaining Underwriters shall be obligated severally to take up
and pay for (in the respective proportions which the amount of Securities set
forth opposite their names in Schedule I hereto bears to the aggregate amount of
Securities set forth opposite the names of all the remaining Underwriters) the
Securities which the defaulting Underwriter or Underwriters agreed but failed to
purchase; PROVIDED, HOWEVER, that in the event that the aggregate amount of
Securities which the defaulting Underwriter or Underwriters agreed but failed to
purchase shall exceed 10% of the aggregate amount of Securities set forth in
Schedule II hereto, the remaining Underwriters shall have the right to purchase
all, but shall not
15
be under any obligation to purchase any of, the Securities, and if such
nondefaulting Underwriters do not purchase all of the Securities, this Agreement
will terminate without liability to any non-defaulting Underwriter or the
Company. In the event of a default by any Underwriter, as set forth in this
Section 10, the Closing Date shall be postponed for such period, not exceeding
seven days, as the Representative shall determine in order that the required
changes in the Registration Statement and in the Prospectus or in any other
documents or arrangements may be effected. Nothing herein contained shall
relieve any defaulting Underwriter of its liability, if any, to the Company and
any non-defaulting Underwriter for damages occasioned by its default hereunder.
11. TERMINATION. This Agreement shall be subject to termination in the
absolute discretion of the Representative, by notice given to the Company prior
to delivery of and payment for all Securities, (a) if prior to such time trading
in securities generally on the New York Stock Exchange shall have been suspended
or limited or minimum prices shall have been established, or (b) if a banking
moratorium shall have been declared either by Federal or New York State
authorities, or (c) if trading in any securities of the Company shall have been
suspended or halted, or (d) if there shall have occurred any outbreak or
escalation of hostilities, declaration by the United States of a national
emergency or war, or other calamity or crisis the effect of which on financial
markets is such as to make it, in the sole judgment of the Representative,
impractical or inadvisable to proceed with the offering or delivery of the
Securities as contemplated by the Prospectus.
12. REPRESENTATIONS AND INDEMNITIES TO SURVIVE DELIVERY. The respective
agreements, representations, warranties, indemnities and other statements of the
Company or its officers and of the Underwriters set forth in or made pursuant to
this Agreement will remain in full force and effect, regardless of any
investigation made by or on behalf of any Underwriter or the Company or any of
its officers or directors or any controlling person within the meaning of the
Act, and will survive delivery of and payment for the Securities. The provisions
of Sections 5, 8 and 9 hereof shall survive the termination or cancellation of
this Agreement.
13. NOTICES. All communications hereunder will be in writing and, if
sent to the Representative, will be mailed, delivered or telegraphed and
confirmed to them at their address set forth for that purpose in Schedule I
hereto or, if sent to the Company, will be mailed, delivered or telegraphed and
confirmed to it at 000 Xxxx Xxxxxxxxx Xxxx, Xxxxxxxx, Xxx Xxxx 00000, attention
of Xxxxxx X. XxXxxxx, Xx., Vice President - Law and General Counsel.
14. SUCCESSORS. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the officers
and directors and controlling persons referred to in Section 9 hereof, and no
other person will have any right or obligation hereunder.
15. APPLICABLE LAW. This Agreement will be governed by and construed in
accordance with the internal substantive laws and not the choice of law rules of
the State of New York.
16. COUNTERPARTS. This Agreement may be executed in counterparts, all of
which, taken together, shall constitute a single agreement among the parties to
such counterparts.
16
17. REPRESENTATION OF THE UNDERWRITERS. The Representative represents
and warrants to the Company that it is authorized to act as the representative
of the Underwriters in connection with this financing and that the execution and
delivery of this Agreement and any action under this Agreement taken by such
Representative will be binding upon all Underwriters.
17
If the foregoing is in accordance with your understanding of our
agreement, kindly sign and return to us the enclosed duplicate hereof, whereupon
this letter and your acceptance shall represent a binding agreement among the
Company and the several Underwriters in accordance with its terms.
Very truly yours,
NIAGARA MOHAWK POWER CORPORATION
By: /s/ Xxxxxxx X. Xxxxxxx
-----------------------
Title: Senior Vice President and
Chief Financial Officer
18
The foregoing Agreement is hereby confirmed and
accepted as of the date first
above written.
For themselves and as Representative of the several
Underwriters, if any, named in Schedule I hereto.
By: Xxxxxxx Xxxxx Xxxxxx Inc.,
as Representative
By: /s/ Xxxxxx X. Xxxxxx
---------------------
Title: Managing Director
19
SCHEDULE II
Underwriting Agreement dated: September 25, 2001
Registration Statement No.333-33826
Representative and Address: Xxxxxxx Xxxxx Xxxxxx Inc., 000 Xxxxxxxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000
Securities:
Designation: 5.375 % Senior Notes due 2004
Principal Amount: $300,000,000
Supplemental Indenture: Dated as of September 28, 2001
Date of Maturity: October 1, 2004
Interest Rate: 5.375 %
Purchase Price: $298,809,000
Public Offering Price: $299,859,000
Redemption Provisions: Redeemable by the Company at any time, at a
redemption price equal to 100% of the principal amount thereof, plus
accrued and unpaid interest thereon through the redemption date plus the
excess of (i)the discounted future cash flow on such Security (discounted
at a rate equal to that Security by comparable U.S. Treasury obligation
plus 0.25%), over (ii) the principal amount of such Security.
Closing Date and Location: September 28, 2001; Xxxxxxxx & Xxxxxxxx, 000 Xxxxx
Xxxxxx, Xxx Xxxx, XX 00000
SCHEDULE I
Principal Amount
Name of Underwriter of Securities
---------------------------------------------------------- ------------------
Xxxxxxx Xxxxx Barney Inc. $180,000,000
Banc One Capital Markets, Inc. 60,000,000
Credit Suisse First Boston Corporation 60,000,000
Total............................................... $300,000,000
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