[EXHIBIT 1 TO FORM S-3]
$75,000,000
Colonial Gas Company
Secured Medium Term Notes, Series B
Due from 9 Months to 40 years from Date of Issue
DISTRIBUTION AGREEMENT
March ___, 1998
Salomon Brothers Inc
Seven World Trade Center
New York, New York 10048
X.X. Xxxxxxx & Sons, Inc.
Xxx Xxxxx Xxxxxxxxx Xxxxxx
Xx. Xxxxx, Xxxxxxxx 00000
Xxxxxxx Xxxxx & Co.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
World Financial Center
North Tower
New York, New York 10281
Ladies and Gentlemen:
Colonial Gas Company, a Massachusetts corporation (the "Company"),
confirms its agreement with Salomon Brothers Inc, X.X. Xxxxxxx & Sons, Inc.
and Xxxxxxx Xxxxx & Co., Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
(each, an "Agent" and collectively, the "Agents") with respect to the issue
and sale by the Company of its Secured Medium Term Notes, Series B, due
from 9 months to 40 years from date of issue (the "Notes"). The Notes are
to be issued as a new series of first mortgage bonds under the Company's
Second Amended and Restated First Mortgage Indenture to State Street Bank
and Trust Company, as trustee (the "Trustee"), dated as of June 15, 1992,
as heretofore supplemented and as it is to be further supplemented by a
Fourth Supplemental Indenture, dated as of March ___, 1998 (the
"Supplemental Indenture") (said Indenture, as heretofore supplemented and
as it is to be further supplemented, being hereinafter referred to as the
"Mortgage"). As of the date hereof, the Company has authorized the
issuance and sale of up to $75,000,000 aggregate principal amount of Notes
through the Agents pursuant to the terms of this Agreement. It is
understood, however, that the Company may from time to time authorize the
issuance of additional Notes and that such additional Notes may be sold
through or to the Agents pursuant to the terms of this Agreement, all as
though the issuance of such Notes were authorized as of the date hereof.
This Agreement provides both for the sale of Notes by the Company
directly to purchasers, in which case the Agents will act as agents of the
Company in soliciting Note purchases, and (as may from time to time be
agreed to by the Company and the applicable Agent) to an Agent as principal
for resale to purchasers.
On March 24, 1998, the Company filed with the Securities and Exchange
Commission (the "SEC") a registration statement on Form S-3 (No. 333 - )
under the Securities Act of 1933 (the "1933 Act") relating to $75,000,000
aggregate principal amount of the Company's secured medium term notes and
the offering thereof from time to time in accordance with Rule 415 of the
rules and regulations of the SEC under the 1933 Act (the "1933 Act
Regulations"). Such registration statement has been declared effective by
the SEC and the Mortgage has been qualified under the Trust Indenture Act
of 1939 (the "1939 Act"). Such registration statement (and any further
registration statement that may be filed by the Company for the purpose of
registering additional secured medium term notes of the Company and in
connection with which this Agreement is included or incorporated by
reference as an exhibit) and the prospectus constituting a part of such
registration statement, and any prospectus or pricing supplements relating
to the Notes, including all documents incorporated therein by reference
pursuant to Item 12 of Form S-3 under the 1933 Act (the "Incorporated
Documents"), as from time to time amended or supplemented, are referred to
herein as the "Registration Statement" and the "Prospectus", respectively,
except that if any revised prospectus shall be provided to the Agents by
the Company for use in connection with the offering of the Notes which is
not required to be filed by the Company pursuant to Rule 424(b) of the 1933
Act Regulations, the term "Prospectus" shall refer to such revised
prospectus from and after the time it is first provided to an Agent 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 Incorporated Document after the time
of execution of this Agreement; provided, however, that any supplement to
the Prospectus filed with the SEC pursuant to Rule 424(b) of the 1933 Act
Regulations with respect to an offering of securities of the Company, other
than the Notes, shall not be deemed to be a supplement to, or a part of,
the Prospectus.
SECTION 1. Appointment as Agents.
(a) Appointment of Agents. Subject to the terms and conditions
stated herein and subject to the reservation by the Company of the right to
sell Notes directly on its own behalf, the Company hereby appoints the
Agents as its agents for the purpose of soliciting purchases of the Notes
from the Company by others and agrees that, except as otherwise
contemplated herein, whenever the Company determines to sell Notes directly
to an Agent as principal for resale to others, it will enter into a Terms
Agreement (as defined herein) relating to such sale in accordance with the
provisions of Section 3(b) hereof. The Agents are authorized to appoint a
sub-agent or to engage the services of any other broker or dealer in
connection with the offer or sale of the Notes. The Company agrees that,
during the period the Agents are acting as the Company's agents hereunder,
the Company will not contact or solicit potential investors introduced to
it by an Agent to purchase the Notes. The Company may appoint, upon 30
days prior written notice to the Agents, additional persons to serve as
Agents hereunder, but only if each such additional person agrees to be
bound by all of the terms of this Agreement as an Agent.
(b) Reasonable Efforts Solicitations; Right to Reject Offers. Upon
receipt of instructions from the Company, each Agent will use its
reasonable efforts to solicit purchases of such principal amount of the
Notes as the Company and such Agent shall agree upon from time to time
during the term of this Agreement, it being understood that the Company
shall not approve the solicitation of purchases of Notes in excess of the
amount which shall be authorized by the Company and the Department of
Telecommunications and Energy of the Commonwealth of Massachusetts
(formerly known as the Department of Public Utilities ) (the "DTE") from
time to time or in excess of the principal amount of Notes registered
pursuant to the Registration Statement. The Agents will have no
responsibility for maintaining records with respect to the aggregate
principal amount of Notes sold, or of otherwise monitoring the availability
of Notes for sale under the Registration Statement or applicable DTE
authorizations. Each Agent will communicate to the Company, orally or in
writing, each offer to purchase Notes, other than those offers rejected by
such Agent. Each Agent shall have the right, in its discretion reasonably
exercised, to reject any proposed purchase of Notes, in whole or in part,
and any such rejection shall not be deemed a breach of such Agent's
agreement contained herein. The Company may accept or reject any proposed
purchase of the Notes, in whole or in part.
(c) Solicitations as Agent; Purchases as Principal. In soliciting
purchases of the Notes on behalf of the Company, the Agents shall act
solely as agents for the Company and not as principal. An Agent shall make
reasonable efforts to assist the Company in obtaining performance by each
purchaser whose offer to purchase Notes has been solicited by such Agent
and accepted by the Company. The Agents shall not have any liability to
the Company in the event any such purchase is not consummated for any
reason. An Agent shall not have any obligation to purchase Notes from the
Company as principal, but each Agent may agree from time to time to
purchase Notes as principal. Any such purchase of Notes by an Agent as
principal shall be made pursuant to a Terms Agreement in accordance with
Section 3(b) hereof.
(d) Reliance. The Company and each Agent agree that any Notes the
placement of which such Agent arranges shall be placed by such Agent, and
any Notes purchased by such Agent shall be purchased, in reliance on the
representations, warranties, covenants and agreements of the Company
contained herein and on the terms and conditions and in the manner provided
herein.
SECTION 2. Representations and Warranties.
(a) The Company represents and warrants to each Agent, and agrees
with each Agent, as of the date hereof, as of the date of each acceptance
by the Company of an offer for the purchase of Notes (whether through an
Agent as agent or to an Agent as principal), as of the date of each
delivery of Notes (whether through such Agent as agent or to the Agent as
principal) (the date of each such delivery to an Agent as principal being
hereafter referred to as a "Settlement Date"), and as of any time that the
Registration Statement or the Prospectus shall be amended or supplemented
(other than by any Current Report on Form 8-K relating exclusively to the
issuance of Notes under the Registration Statement, unless the Agents shall
otherwise specify to the Company that the following representations and
warranties are applicable thereto) (each of the times referenced above
being referred to herein as a "Representation Date") as follows:
(i) Due Incorporation and Qualification. The Company has been
duly incorporated and is validly existing as a corporation in good
standing under the laws of the Commonwealth of Massachusetts with
corporate power and authority to own, lease and operate its properties
and to conduct its business as described in the Registration Statement
and the Prospectus; and the Company is duly qualified as a foreign
corporation to transact business and is in good standing in each
jurisdiction in which such qualification is required, whether by
reason of the ownership or leasing of property or the conduct of
business, except where the failure to so qualify and be in good
standing would not have a material adverse effect on the condition,
financial or otherwise, or the earnings, business affairs or business
prospects of the Company and its subsidiaries considered as one
enterprise.
(ii) Subsidiaries. Each subsidiary of the Company which is a
significant subsidiary (each, a "Significant Subsidiary") as defined
in Rule 405 of Regulation C of the 1933 Act Regulations has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of the jurisdiction of its incorporation, has corporate
power and authority to own, lease and operate its properties and
conduct its business as described in the Prospectus and is duly
qualified as a foreign corporation to transact business and is in good
standing in each jurisdiction in which such qualification is required,
whether by reason of the ownership or leasing of property or the
conduct of business, except where the failure to so qualify and be in
good standing would not have a material adverse effect on the
condition, financial or otherwise, or the earnings, business affairs
or business prospects of the Company and its subsidiaries considered
as one enterprise; and all of the issued and outstanding capital stock
of each Significant Subsidiary has been duly authorized and validly
issued, is fully paid and non-assessable and, except for directors'
qualifying shares, is owned by the Company, directly or through
subsidiaries, free and clear of any security interest, mortgage,
pledge, lien, encumbrance, claim or equity.
(iii) Registration Statement and Prospectus. The
Registration Statement, at the Effective Date, complied, and as of the
applicable Representation Date will comply, in all material respects
with the requirements of the 1933 Act, the 1933 Act Regulations, the
1939 Act and the rules and regulations of the SEC promulgated
thereunder (the "1939 Act Regulations"). The Registration Statement,
at the Effective Date, did not, and as of each Representation 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 not misleading. The Prospectus, as of the
date hereof, does not, and as of each Representation Date, will not,
contain an untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not
misleading; 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 Company in writing by the
Agents expressly for use in the Registration Statement or Prospectus
or to any statements in or omissions from the Statement of Eligibility
of the Trustee under the Mortgage on Form T-1 (the "Form T-1"). As
used herein, the term "Effective Date" means the later of (i) the date
that the Registration Statement or the most recent post-effective
amendment thereto was or is declared effective by the SEC under the
1933 Act and (ii) the date that the Company's Annual Report on Form
10-K for its most recently completed fiscal year is filed with the SEC
under the 1934 Act.
(iv) Incorporated Documents. The Incorporated Documents, at the
time they were or hereafter are filed with the SEC, complied or when
so filed will comply, as the case may be, in all material respects
with the requirements of the 1934 Act and the rules and regulations
promulgated thereunder (the "1934 Act Regulations"), and, when read
together and with the other information in the Prospectus, did not and
will not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary in
order to make the statements therein, in the light of the
circumstances under which they were or are made, not misleading.
(v) Accountants. Xxxxx Xxxxxxxx LLP, the accountants who
audited the financial statements included or incorporated by
reference in the Prospectus, are independent public accountants with
respect to the Company and its subsidiaries within the meaning of the
1933 Act and the 1933 Act Regulations (hereinafter, the
"Accountants").
(vi) Financial Statements. The financial statements and any
supporting schedules of the Company and its consolidated subsidiaries
included or incorporated by reference in the Registration Statement
and the Prospectus present fairly the consolidated financial position
of the Company and its consolidated subsidiaries as of the dates
indicated and the consolidated results of their operations for the
periods specified; and, except as stated therein, said financial
statements have been prepared in conformity with generally accepted
accounting principles in the United States applied on a consistent
basis; and the supporting schedules included in the Registration
Statement present fairly the information required to be stated
therein.
(vii) Authorization and Validity of this Agreement, the
Mortgage and the Notes. This Agreement has been duly authorized,
executed and delivered by the Company and, upon execution and delivery
by the Agents, will be a valid and binding agreement of the Company;
the Mortgage has been duly authorized, executed and delivered by the
Company and qualified under the 1939 Act and constitutes a valid and
binding obligation of the Company enforceable against the Company in
accordance with its terms, except as may be limited by bankruptcy,
insolvency, reorganization or other similar laws affecting enforcement
of mortgagees' and other creditors' rights and by general equitable
principles (whether considered in a proceeding in equity or at law);
the Notes have been duly and validly authorized for issuance, offer
and sale pursuant to this Agreement and, when issued, authenticated
and delivered pursuant to the applicable DTE authorizations and the
provisions of this Agreement and the Mortgage against payment of the
consideration therefor specified in the Prospectus or pursuant to any
Terms Agreement in accordance with Section 3(b) hereof, the Notes will
constitute valid and legally binding obligations of the Company
enforceable against the Company in accordance with their respective
terms, except as may be limited by bankruptcy, insolvency,
reorganization or other similar laws affecting enforcement of
mortgagees' and other creditors' rights and by general equitable
principles (whether considered in a proceeding in equity or at law);
the Notes and the Mortgage will be substantially in the form
heretofore delivered to the Agents and conform in all material
respects to all statements relating thereto contained in the
Prospectus; and the Notes will be entitled to the benefits provided
and security afforded by the Mortgage.
(viii) Material Changes or Material Transactions. Since the
respective dates as of which information is given in the Registration
Statement and the Prospectus, except as may otherwise be stated
therein or contemplated thereby, (a) there has been no material
adverse change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Company and
its subsidiaries considered as one enterprise, whether or not arising
in the ordinary course of business and (b) there have been no
transactions entered into by the Company or any of its subsidiaries,
other than those in the ordinary course of business, which are
material to the Company and its subsidiaries considered as one
enterprise.
(ix) No Defaults; No Conflicts. Neither the Company nor any of
its Significant Subsidiaries is in violation of its charter or in
default in the performance or observance of any material obligation,
agreement, covenant or condition contained in the Mortgage or any
other material contract, indenture, mortgage, loan agreement, note,
lease or other instrument to which it is a party or by which it or any
of them or their properties is bound; the execution and delivery of
this Agreement and the Supplemental Indenture and the consummation of
the transactions contemplated herein, therein and pursuant to any
applicable Terms Agreement have been duly authorized by all necessary
corporate action and will not conflict with or constitute a breach of,
or default under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company or
any of its Significant Subsidiaries pursuant to, any material
contract, indenture, mortgage, loan agreement, note, lease or other
instrument to which the Company or any of its subsidiaries is a party
or by which it or any of them may be bound or to which any of the
property or assets of the Company or any such subsidiary is subject
(except pursuant to the Mortgage), nor will such action result in any
violation of the provisions of the charter or by-laws of the Company
or any such subsidiary or any applicable law, administrative
regulation or administrative or court order or decree applicable to
the Company or any such subsidiary.
(x) Legal Proceedings; Contracts. Except as may be set forth in
the Registration Statement and the Prospectus, there is no action,
suit or proceeding before or by any court or governmental agency or
body, domestic or foreign, now pending, or, to the knowledge of the
Company, threatened against or affecting, the Company or any of its
subsidiaries, which might, in the opinion of the Company, result in
any material adverse change in the condition, financial or otherwise,
or in the earnings, business affairs or business prospects of the
Company and its subsidiaries considered as one enterprise, or might
materially and adversely affect the properties or assets thereof or
might materially and adversely affect the consummation of this
Agreement or any Terms Agreement; and there are no contracts or
documents of the Company or any of its subsidiaries which are required
to be filed as exhibits to the Registration Statement by the 1933 Act
or by the 1933 Act Regulations which have not been so filed.
(xi) Regulatory Approvals. The Company is subject to the
jurisdiction of the DTE which is vested with powers of supervision,
regulation and control over various matters including the issuance of
securities. No authorization, approval or consent of any court or
governmental authority or agency is necessary in connection with the
sale by the Company of the Notes hereunder, except (i) for on order of
the DTE issued December 9, 1997 (D.P.U./D.T.E. 97-83) (the "DTE
Order") authorizing the issuance and sale by the Company of up to
$45,896,060 aggregate principal amount of Notes, subject to reduction
in the event of the issuance of certain other securities of the
Company (the "Authorized Notes") on terms consistent with this
Agreement and any applicable Terms Agreement, which order has been
obtained and is in full force and effect, (ii) Additional DTE Orders
(as defined in Section 4(a) hereof) authorizing the issuance and sale
by the Company of the Notes in aggregate principal amount greater than
the aggregate principal amount of the Authorized Notes (the
"Additional Notes") on terms consistent with this Agreement and any
applicable Terms Agreement, which orders will have been obtained and
will be in full force and effect prior to the issuance and sale of the
Additional Notes by the Company, and (iii) as otherwise may be
required under the 1933 Act, the 1939 Act, the 1933 Act Regulations or
state securities or blue sky laws.
(xii) Title to Property. The Company and its subsidiaries
have good and marketable title in fee simple (or its equivalent under
applicable law) to all real property and good and marketable title to
all personal property owned by them which is material to the business
of the Company and its subsidiaries, in each case free and clear of
all liens, encumbrances and defects except such as are described in
the Registration Statement and the Prospectus or such as do not
materially affect the value of such property and do not interfere with
the use made and proposed to be made of such property by the Company
and its subsidiaries; and any real property and buildings held under
lease by the Company and its subsidiaries which are material to the
business of the Company and its subsidiaries are held by them under
valid, subsisting and enforceable leases with such exceptions as are
not material and do not interfere with the use made and proposed to be
made of such property and buildings by the Company and its
subsidiaries.
(xiii) Statutory Authority, Franchises, Permits, Easements and
Consents. The Company and its subsidiaries have statutory authority,
franchises, permits, easements and consents free from unduly
burdensome restrictions and adequate for the conduct of the respective
businesses in which they are engaged.
(xiv) No Labor Disputes. Except as set forth in the
Registration Statement and the Prospectus, no labor disturbance by the
employees of the Company or any subsidiary exists or is imminent which
might be expected to materially adversely affect the conduct of the
business, operations, financial condition or income of the Company and
its subsidiaries considered as one enterprise.
(xv) Public Utility Holding Company Act. Neither the Company nor
any of its subsidiaries is a "holding company", or a "subsidiary
company" of a "holding company", or an "affiliate" of a "holding
company" or of such a "subsidiary company" within the meaning of the
Public Utility Holding Company Act of 1935 (the "1935 Act").
(xvi) Environmental and Other Matters. Except as set forth
in the Registration Statement and the Prospectus, neither the Company
nor its subsidiaries (in the case of matters relating to environmental
protection, occupational safety and health and equal employment
opportunity, to the best of its knowledge) (a) is in violation of any
laws, ordinances, governmental rules and regulations to which it is
subject or (b) has failed to obtain any licenses, permits, franchises
or other governmental authorizations, necessary to the ownership of
its property or to the conduct of its business, which violation or
such failure to obtain could reasonably be expected to materially
adversely affect the business, business prospects, profits, properties
or condition (financial or otherwise) of the Company and its
subsidiaries considered as one enterprise.
(xvii) Contingent Liabilities. To the best knowledge of the
Company, after reasonable investigation, the Company and its
subsidiaries have no material contingent liability which is not
disclosed in the Registration Statement and the Prospectus, including
the financial statements and related notes.
(xviii) Ratings. The Notes, prior to any issuance thereof, will
be rated Baa 1 by Xxxxx'x Investors Service, Inc. and A by Standard &
Poor's or such other rating as to which the Company shall have most
recently notified the Agents of pursuant to Section 4(a) hereof.
(b) Additional Certifications. Any certificate signed by any
director or officer of the Company and delivered to the Agents or to
counsel for the Agents in connection with an offering of Notes or the sale
of Notes to an Agent as principal shall be deemed a representation and
warranty by the Company to the Agents as to the matters covered thereby on
the date of such certificate and at each Representation Date subsequent
thereto.
SECTION 3. Solicitations as Agent; Purchases as Principal.
(a) Solicitations as Agent. On the basis of the representations and
warranties herein contained, but subject to the terms and conditions herein
set forth, each Agent agrees, as the agent of the Company, to use its
reasonable efforts to solicit offers to purchase the Notes from time to
time as requested by the Company upon the terms and conditions set forth
herein and in the Prospectus.
The Company reserves the right, in its sole discretion, to suspend
solicitation of purchases of the Notes through an Agent, as agent,
commencing at any time for any period of time or permanently. As soon as
practicable, upon receipt of instructions from the Company, such Agent will
forthwith suspend solicitation of purchases from the Company until such
time as the Company has advised such Agent that such solicitation may be
resumed.
The Company agrees to pay each Agent a commission, in the form of a
discount, equal to the applicable percentage of the principal amount of
each Note sold by the Company as a result of a solicitation made by such
Agent as set forth in Schedule A hereto. An Agent may reallow any portion
of the commission payable pursuant hereto to dealers or purchasers in
connection with the offer and sale of any Notes.
The purchase price, interest rate, maturity date and other terms of
the Notes shall be agreed upon by the Company and the Agents and set forth
in a pricing supplement to the Prospectus to be prepared following each
acceptance by the Company of an offer for the purchase of Notes. Except as
may be otherwise provided in such pricing supplement to the Prospectus, the
Notes will be issued in denominations of $1,000 or any larger amount that
is an integral multiple of $1,000. All Notes sold through an Agent as
agent will be sold at 100% of their principal amount unless otherwise
agreed to by the Company and such Agent.
(b) Purchases as Principal. Each sale of Notes to an Agent as
principal shall be made in accordance with the terms contained herein and
(unless the Company and such Agent shall otherwise agree) pursuant to a
separate agreement which will provide for the sale of such Notes to, and
the purchase and reoffering thereof by, such Agent. Each such separate
agreement (which terms, unless otherwise agreed, shall, to the extent
applicable, include those terms specified in Exhibit A hereto and be agreed
upon orally with written confirmation prepared by such Agent or Agents and
mailed or sent by facsimile transmission to the Company) between such Agent
and the Company is herein referred to as a "Terms Agreement". Unless the
context otherwise requires, each reference contained herein to "this
Agreement" shall be deemed to include any applicable Terms Agreement
between the Company and the applicable Agent. An Agent's commitment to
purchase Notes as principal pursuant to any Terms Agreement or otherwise
shall be deemed to have been made on the basis of the representations and
warranties of the Company herein contained and shall be subject to the
terms and conditions herein set forth. Each Terms Agreement shall specify
the principal amount of Notes to be purchased by such Agent pursuant
thereto, the price to be paid to the Company for such Notes (which, if not
so specified in a Terms Agreement, shall be at a discount equivalent to the
applicable commission set forth in Schedule A hereto), the price to the
public, the time and place of delivery of and payment for such Notes, any
provisions applicable to the failure of any Agents (if more than one) to
purchase and pay for the Notes it has agreed to purchase and pay for
thereunder, and such other provisions (including further terms of the
Notes) as may be mutually agreed upon. Each Agent may utilize a selling or
dealer group in connection with the resale of the Notes purchased. Such
Terms Agreement shall also specify the requirements for the stand-off
agreement, the officers' certificate, opinions of counsel and comfort
letter pursuant to Sections 4(k), 7(b), 7(c) and 7(d) hereof.
(c) Administrative Procedures. The Notes will be issued in
accordance with the Administrative Procedures specified in Exhibit B hereto
as may be amended from time to time by written agreement between the Agents
and the Company (the "Procedures"). The Agents and the Company agree to
perform the respective duties and obligations specifically provided to be
performed by them in the Procedures.
SECTION 4. Covenants of the Company.
The Company covenants and agrees with each Agent as follows:
(a) Notice of Certain Events. The Company will notify the Agents
immediately, and confirm such notice in writing, (i) of the effectiveness
of any amendment to the Registration Statement (which shall not include the
filing of any Incorporated Document), (ii) of the receipt of any comments
from the SEC with respect to the Registration Statement or the Prospectus,
(iii) of any request by the SEC for any amendment to the Registration
Statement or any amendment or supplement to the Prospectus or for
additional information, (iv) of the issuance by the SEC of any stop order
suspending the effectiveness of the Registration Statement or the
initiation of any proceedings for that purpose, (v) the issuance of any
order or orders of the DTE (each, an "Additional DTE Order") authorizing
the issuance and sale by the Company of the Additional Notes, (vi) the
expiration or modification of the DTE Order or any Additional DTE Orders
and (vii) any change in the rating assigned by any nationally recognized
statistical rating organization to the Notes or the public announcement by
any nationally recognized statistical rating organization that it has under
surveillance or review, with possible negative implications, its rating of
the Notes or the withdrawal by any nationally recognized statistical rating
organization of its rating of the Notes. The Company will make every
reasonable effort to prevent the issuance of any stop order and, if any
stop order is issued, to obtain the lifting thereof at the earliest
possible moment.
(b) Notice of Certain Proposed Filings. The Company will give the
Agents notice of its intention to file or prepare any additional
registration statement with respect to the registration of additional
Notes, any amendment to the Registration Statement (which shall not include
the filing of any Incorporated Document) or any amendment or supplement to
the Prospectus, whether by the filing of documents pursuant to the 1934
Act, the 1933 Act or otherwise, and, in any case, including the filing of
any Incorporated Document, will furnish the Agents with copies of any such
amendment or supplement or other documents proposed to be filed or prepared
a reasonable time in advance of such proposed filing or preparation, as the
case may be, and will not file any such amendment or supplement or other
documents in a form to which the Agents or counsel for the Agents shall
reasonably object.
(c) Copies of the Registration Statement and the Prospectus. The
Company will deliver to the Agents as many signed and conformed copies of
the Registration Statement (as originally filed) and of each amendment
thereto (including exhibits filed therewith or incorporated by reference
therein and Incorporated Documents) as the Agents may reasonably request.
The Company will furnish to the Agents as many copies of the Prospectus (as
amended or supplemented) as the Agents shall reasonably request so long as
the Agents are required to deliver a Prospectus in connection with sales or
solicitations of offers to purchase the Notes.
(d) Preparation of Pricing Supplements. The Company will prepare,
with respect to any Notes to be sold through or to any Agent pursuant to
this Agreement, a Pricing Supplement with respect to such Notes in a form
previously approved by such Agent and will file such Pricing Supplement
pursuant to Rule 424(b)(3) under the 1933 Act not later than the close of
business of the SEC on the fifth business day after the date on which such
Pricing Supplement is first used.
(e) Prospectus Revisions -- Material Changes. Except as otherwise
provided in subsection (l) of this Section 4, if at any time during the
term of this Agreement any event shall occur or condition exist as a result
of which it is necessary, in the reasonable opinion of counsel for the
Agents or counsel for the Company, to further amend or supplement the
Prospectus in order that the Prospectus will not include an untrue
statement of a material fact or omit to state any material fact necessary
in order to make the statements therein not misleading in the light of the
circumstances existing at the time the Prospectus is delivered to a
purchaser, or if it shall be necessary, in the reasonable opinion of either
such counsel, to amend or supplement the Registration Statement or the
Prospectus in order to comply with the requirements of the 1933 Act or the
1933 Act Regulations, immediate notice shall be given, and confirmed in
writing, to the Agents to cease the solicitation of offers to purchase the
Notes in the Agents' capacity as agents and to cease sales of any Notes the
Agents may then own as principal pursuant to a Terms Agreement, and the
Company will promptly prepare and file with the SEC such amendment or
supplement, whether by filing documents pursuant to the 1934 Act, the 1933
Act or otherwise, as may be necessary to correct such untrue statement or
omission or to make the Registration Statement and Prospectus comply with
such requirements.
(f) Prospectus Revisions -- Periodic Financial Information. Except
as otherwise provided in subsection (l) of this Section 4, on or prior to
the date on which there shall be released to the general public interim
financial statement information related to the Company with respect to each
of the first three quarters of any fiscal year or preliminary financial
statement information with respect to any fiscal year, the Company shall
furnish such information to the Agents, confirmed in writing, and, if such
information is required to be described or is proposed to be described by
the Company in a filing under the 1933 Act or the 1934 Act, shall cause the
Prospectus to be amended or supplemented to include or incorporate by
reference financial information with respect thereto and corresponding
information for the comparable period of the preceding fiscal year, as well
as such other information and explanations as shall be necessary for an
understanding thereof or as shall be required by the 1933 Act or the 1933
Act Regulations.
(g) Prospectus Revisions -- Audited Financial Information. Except as
otherwise provided in subsection (l) of this Section 4, on or prior to the
date on which there shall be released to the general public financial
information included in or derived from the audited financial statements of
the Company for the preceding fiscal year, the Company shall cause the
Registration Statement and the Prospectus to be amended, whether by the
filing of documents pursuant to the 1934 Act, the 1933 Act or otherwise, to
include or incorporate by reference such audited financial statements and
the report or reports, and consent or consents to such inclusion or
incorporation by reference, of the Accountants with respect thereto, as
well as such other information and explanations as shall be necessary for
an understanding of such financial statements or as shall be required by
the 1933 Act or the 1933 Act Regulations.
(h) Earning Statements. The Company will make generally available to
its security holders as soon as practicable, but not later than 90 days
after the close of the period covered thereby, an earning statement (in
form complying with the provisions of Rule 158 under the 1933 Act
Regulations) covering each twelve month period beginning, in each case, not
later than the first day of the Company's fiscal quarter next following the
"effective date" (as defined in such Rule 158) of the Registration
Statement with respect to each sale of Notes.
(i) Blue Sky Qualifications. The Company will endeavor, in
cooperation with the Agents, to qualify the Notes for offering and sale
under the applicable securities laws of such states and other jurisdictions
of the United States as the Agents may designate and as shall be subject to
the reasonable approval of the Company, and will maintain such
qualifications in effect for as long as may be required for the
distribution of the Notes; provided, however, that the Company shall not be
obligated to file any general consent to service of process or to qualify
as a foreign corporation in any jurisdiction in which it is not so
qualified. The Company will file such statements and reports as may be
required by the laws of each jurisdiction in which the Notes have been
qualified as above provided. The Company will promptly advise the Agents
of the receipt by the Company of any notification with respect to the
suspension of the qualification of the Notes for sale in any such state or
jurisdiction or the initiating or threatening of any proceeding for such
purpose.
(j) 1934 Act Filings. The Company, during the period when the
Prospectus is required to be delivered under the 1933 Act, will file
promptly all documents required to be filed with the SEC pursuant to
Sections 13(a), 13(c), 14 or 15(d) of the 1934 Act in compliance with the
1934 Act and the 1934 Act Regulations.
(k) Stand-Off Agreement. If required pursuant to the terms of a
Terms Agreement, between the date of such Terms Agreement and the
Settlement Date with respect to such Terms Agreement, the Company will not,
without the applicable Agent's prior consent, offer or sell, or enter into
any agreement to sell, any debt securities of the Company (other than the
Notes that are to be sold pursuant to such Terms Agreement, bank
borrowings, leases and commercial paper in the ordinary course of
business).
(l) Suspension of Certain Obligations. The Company shall not be
required to comply with the provisions of subsections (e), (f) or (g) of
this Section 4 or the provisions of subsections (b), (c), (d) or (f) of
Section 7 during any period from the time (i) the Agents shall have
suspended solicitation of purchases of the Notes in their capacity as
agents pursuant to a request from the Company and (ii) the Agents shall not
then hold any Notes as principal purchased pursuant to a Terms Agreement,
to the time the Company shall determine that solicitation of purchases of
the Notes should be resumed or shall subsequently enter into a new Terms
Agreement with any of the Agents. However, prior to instructing the Agents
to resume the solicitation of offers to purchase Notes or prior to entering
into a new Terms Agreement, the Company shall be required to comply with
the provisions of subsections (b), (c) and (d) of Section 7, by delivering
or causing to be delivered the certificates, opinions or letters which
would have otherwise been required under each such subsection unless the
Agents otherwise determine in their sole discretion that such documents in
respect of prior periods need not be delivered.
(m) Condition to Agency Transactions. Any person who has agreed to
purchase Notes as the result of an offer to purchase solicited by an Agent
shall have the right to refuse to purchase and pay for such Notes if, on
the related settlement date fixed pursuant to the Procedures, (i) there has
been, since the date on which such person agreed to purchase the Notes (the
"Trade Date"), or since the respective dates as of which information is
given in the Registration Statement, any material adverse change in the
condition, financial or otherwise, or in the earnings, business affairs or
business prospects of the Company and its subsidiaries considered as one
enterprise, whether or not arising in the ordinary course of business or
(ii) the rating assigned by any nationally recognized securities rating
agency to any debt securities of the Company as of the Trade Date shall
have been lowered since that date or if any such rating agency shall have
publicly announced that it has under surveillance or review, with possible
negative implications, its rating of any debt securities of the Company.
SECTION 5. Conditions of Obligations.
The obligations of each Agent to solicit offers to purchase the Notes
as agent of the Company, the obligations of any purchasers of the Notes
sold through each Agent as agent, and any obligation of an Agent to
purchase Notes pursuant to a Terms Agreement or otherwise will be subject
to the accuracy of the representations and warranties on the part of the
Company herein and to the accuracy of the statements of the Company's
officers made in any certificate furnished pursuant to the provisions
hereof, to the performance and observance by the Company of all its
covenants and agreements herein contained and to the following additional
conditions precedent:
(a) Legal Opinions. On the date hereof, the Agents shall have
received the following legal opinions, dated as of the date hereof and in
form and substance satisfactory to the Agents:
(1) Opinion of Company Counsel. The opinion of Xxxxxx & Dodge
LLP, counsel to the Company, to the effect that:
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the
Commonwealth of Massachusetts.
(ii) The Company has corporate power and authority to own,
lease and operate its properties and to conduct its business as
described in the Registration Statement and the Prospectus.
(iii) Each Significant Subsidiary of the Company (as
identified by the Company) has been duly incorporated and is
validly existing as a corporation in good standing under the laws
of the jurisdiction of its incorporation, has corporate power and
authority to own, lease and operate its properties and conduct
its business as described in the Registration Statement; all of
the issued and outstanding capital stock of each such Significant
Subsidiary has been duly authorized and validly issued, is fully
paid and non-assessable, and, except for directors' qualifying
shares, is owned of record and, to the best of such counsel's
knowledge, beneficially by the Company, directly or through
subsidiaries, and, to the best of such counsel's knowledge, free
and clear of any mortgage, pledge, lien, encumbrance, claim or
equity.
(iv) This Agreement has been duly and validly authorized,
executed and delivered by the Company.
(v) The Supplemental Indenture has been duly and validly
authorized, executed and delivered by the Company and, as amended
by the Supplemental Indenture, the Mortgage constitutes a valid
and binding agreement of the Company, enforceable against the
Company in accordance with its terms, except as may be limited by
bankruptcy, insolvency, fraudulent conveyance, reorganization or
other similar laws affecting enforcement of mortgagees' or other
creditors' rights and by general equitable principles (whether
considered in a proceeding in equity or at law).
(vi) The Notes are in due and proper form, have been duly
and validly authorized for issuance, offer and sale pursuant to
this Agreement and the Mortgage and, when issued, authenticated
and delivered pursuant to the applicable DTE authorizations and
the provisions of this Agreement and the Mortgage against payment
of the consideration therefor, will constitute valid and binding
obligations of the Company, enforceable against the Company in
accordance with their terms, except as may be limited by
bankruptcy, insolvency, fraudulent conveyance, reorganization or
other similar laws affecting enforcement of mortgagee's and other
creditors' rights and by general equitable principles (whether
considered in a proceeding in equity or at law), and each holder
of Notes will be entitled to the benefits provided and security
afforded by the Mortgage ratably with the holders of all other
first mortgage bonds issued thereunder.
(vii) The statements and summaries of documents in the
Prospectus under the caption "Description of Notes" are accurate
in all material respects.
(viii) The Mortgage is qualified under the 1939 Act.
(ix) The Registration Statement is effective under the 1933
Act and, to the best of such counsel's knowledge, no stop order
suspending the effectiveness of the Registration Statement has
been issued under the 1933 Act or proceedings therefor initiated
or threatened by the SEC.
(x) The Registration Statement, at the Effective Date, and
the Prospectus, as of the date hereof (other than in each case
financial statements and other financial or statistical data
included or incorporated by reference therein and the Form T-1,
as to which no opinion need be rendered) complied as to form in
all material respects with the requirements of the 1933 Act, the
1939 Act, the 1933 Act Regulations and the 1939 Act Regulations.
(xi) To the best of such counsel's knowledge, there are no
legal or governmental proceedings pending or threatened which are
required to be disclosed in the Prospectus, other than those that
are disclosed therein.
(xii) To the best of such counsel's knowledge, neither
the Company nor any of its Significant Subsidiaries is in
violation of its charter or in default in the performance or
observance of any material obligation, agreement, covenant or
condition contained in the Mortgage or any other contract,
indenture, mortgage, loan agreement, note or lease identified by
management as being material to the Company to which it is a
party or by which it or any of them or their properties may be
bound. To the best of such counsel's knowledge, the execution
and delivery of this Agreement and of the Mortgage, and the
consummation by the Company of the transactions contemplated by
this Agreement and the Notes and the incurrence of the
obligations therein contemplated will not conflict with or
constitute a breach of, or default under, or result in the
creation or imposition of any lien, charge or encumbrance upon
any property or assets of the Company or any of its Significant
Subsidiaries pursuant to, any contract, indenture, mortgage, loan
agreement, note, lease or other instrument identified by
management as being material to the Company and to which the
Company or any of its subsidiaries is a party or by which it or
any of them is bound or to which any of the property or assets of
the Company or any such subsidiary is subject (except pursuant to
the Mortgage), nor will such action result in any violation of
the provisions of the charter or by-laws of the Company or any
such subsidiary or any applicable law, administrative regulation
or administrative or court order or decree applicable to the
Company or any such subsidiary.
(xiii) To the best of such counsel's knowledge, there are
no contracts, indentures, mortgages, loan agreements, notes,
leases or other instruments or documents required to be described
or referred to in the Registration Statement or to be filed as
exhibits thereto other than those described or referred to
therein or filed or incorporated by reference as exhibits
thereto.
(xiv) No consent, approval, authorization, order or
decree of any court or governmental agency or body is required
for the consummation by the Company of the transactions
contemplated by this Agreement, except (i) such as have been
obtained under the 1933 Act, the 1933 Act Regulations, the 1939
Act or the 1939 Act Regulations, (ii) the DTE Order, which has
been obtained, and, to the best of such counsel's knowledge, is
in full force and effect and is sufficient for the issuance and
sale of the Authorized Notes by the Company, (iii) any Additional
DTE Orders with respect to the issuance and sale of Additional
Notes by the Company and (iv) such as may be required under state
securities or blue sky laws.
(xv) Each Incorporated Document complied when filed as to
form in all material respects with the 1934 Act and the 1934 Act
Regulations thereunder.
(xvi) The Company and its subsidiaries have the
statutory authority, franchises, permits, easements and consents
adequate to conduct the businesses in which they are respectively
engaged without legal restrictions that would materially affect
their ability to so conduct such business.
(xvii) Neither the Company nor any of its subsidiaries is
a "holding company", or a "subsidiary company" of a "holding
company", or an "affiliate" of a "holding company" or of such a
"subsidiary company" within the meaning of the 1935 Act.
(2) Opinion of Local Counsel for the Company. The opinion of
local counsel to the Company, who shall be reasonably acceptable to
the Agents, to the effect that:
(i) The Company has good and clear record and marketable
title to its parcels of real estate and personal property
constituting fixtures described in such opinion and subject, or
intended to be subject, to the lien of the Mortgage free of
encumbrances except the lien of the Mortgage, liens for current
taxes not yet due and minor exceptions which, in the opinion of
such counsel, are of the nature ordinarily found in properties of
similar character and magnitude and which cannot in any
substantial way interfere with their use in the operation of the
business of the Company.
(ii) The Mortgage contains descriptions of the parcels of
real estate and personal property constituting fixtures described
in such opinion and included therein adequate to subject them to
the lien of the Mortgage.
(iii) The Mortgage has been duly recorded as a real
estate mortgage, duly filed as a chattel mortgage and financing
statements consisting of a true copy of the Mortgage or
incorporating the Mortgage by reference to documents already on
record have been duly filed in all offices in which such
recording or filing is necessary in order to create, and the
Mortgage does create, a valid, direct first mortgage lien on and
perfected security interest in all property described in such
opinion and specifically or generally described or referred to in
the Mortgage as subject to the lien of the Mortgage, subject to
no prior lien except as stated in the Mortgage and except for
encumbrances permitted by the Mortgage and subject to current
taxes not yet due; and no further filing, recording or refiling
or rerecording is necessary except as specified in such opinion
in order to maintain such valid, direct first mortgage lien.
In giving its opinion required by clause (i) of this subsection,
such local counsel may rely on substantially equivalent prior opinions
of counsel to the Company with respect to properties described as
subject to the lien of the Mortgage as of the date of the First
Supplemental Indenture to the Mortgage, provided that such counsel, in
its opinion, identify such prior opinions and state that it believes
that such prior opinions are satisfactory in form and scope.
(3) Opinion of Counsel for the Agents. The opinion of Xxxxxxxx,
Xxxxxxx, Xxxxxx & Xxxxxxx, counsel for the Agents, covering the
matters referred to in subparagraph (1) under the subheadings (iv),
(v), (vi), (vii) (viii), (ix) and (x) above. In giving such opinion,
counsel for the Agents (i) need not opine as to the Company's title to
properties or the nature and extent of the lien of the Mortgage and
(ii) may rely as to all matters of Massachusetts law and legal
conclusions based thereon, upon the opinion of Xxxxxx & Dodge LLP
required by subsection (a)(1) of this Section 5.
(4) In giving their opinions required by subsection (a)(1) and
(a)(3) of this Section 5, Xxxxxx & Dodge LLP and Winthrop, Xxxxxxx,
Xxxxxx & Xxxxxxx shall each additionally state that nothing has come
to their attention that would lead them to believe that the
Registration Statement, as of the Effective Date, contained an untrue
statement of a material fact or omitted to state a material fact
required to be stated therein or necessary in order to make the
statements therein not misleading or that the Prospectus, at the date
hereof, or (if such opinion is being delivered in connection with a
Terms Agreement pursuant to Section 3(b) hereof) at the date of any
Terms Agreement, and at the Settlement Date with respect thereto, as
the case may be, contains any untrue statement of a material fact or
omits 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. Such counsel need not render an opinion
with respect to financial statements and other financial or
statistical data included or incorporated by reference in the
Registration Statement or the Prospectus, as to the Form T-1 or as to
the information contained in the Prospectus under the caption
"Description of Notes--Book-Entry Notes."
(b) Officers' Certificate. At the date hereof the Agents shall have
received a certificate of the President or any Vice President and the chief
financial officer, chief accounting officer, treasurer or controller of the
Company and dated as of the date hereof, to the effect that (i) since the
respective dates as of which information is given in the Registration
Statement and the Prospectus or since the date of any applicable Terms
Agreement, there has not been any material adverse change in the condition,
financial or otherwise, or in the earnings, business affairs or business
prospects of the Company and its subsidiaries considered as one enterprise,
whether or not arising in the ordinary course of business except as set
forth therein, (ii) the other representations and warranties of the Company
contained in Section 2 hereof are true and correct with the same force and
effect as though expressly made at and as of the date of such certificate,
(iii) the Company has performed or complied with all agreements and
satisfied all conditions on its part to be performed or satisfied at or
prior to the date of such certificate, (iv) no stop order suspending the
effectiveness of the Registration Statement has been issued and no
proceedings for that purpose have been initiated or threatened by the SEC,
and (v) the DTE Order issued relating to the issuance and the sale of the
Authorized Notes is in full force and effect and is sufficient to authorize
the issuance and sale of the Authorized Notes.
(c) Comfort Letter. On the date hereof (and subject to the Agents
providing such representations to the Accountants as may be necessary under
SAS No. 72), the Agents shall have received a letter from the Accountants
dated as of the date hereof and in form and substance satisfactory to the
Agents, to the effect that:
(i) They are independent public accountants with respect to the
Company and its subsidiaries within the meaning of the 1933 Act and
the 1933 Act Regulations.
(ii) In their opinion, the consolidated financial statements and
supporting schedules of the Company and its subsidiaries examined 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 1933 Act Regulations
with respect to a registration statement on Form S-3 and the 1934 Act
and the 1934 Act Regulations.
(iii) They have performed procedures specified by the
American Institute of Certified Public Accountants for a review of
interim financial information as described in SAS No. 71, Interim
Financial Information, not constituting an audit, including a reading
of the latest available interim financial statements of the Company
and its indicated subsidiaries, a reading of the minute books of the
Company and such subsidiaries since the end of the most recent fiscal
year with respect to which an audit report has been issued, inquiries
of and discussions with certain officials of the Company and such
subsidiaries responsible for financial and accounting matters with
respect to the unaudited xxxxxxx-dated financial statements included
in the Registration Statement and the Prospectus and the latest
available interim unaudited financial statements of the Company and
its subsidiaries, and such other inquiries and procedures as may be
specified in such letter, and on the basis of such inquiries and
procedures nothing came to their attention that caused them to believe
that: (A) the unaudited consolidated financial statements of the
Company and its subsidiaries included in the Registration Statement
and the Prospectus do not comply as to form in all material respects
with the applicable accounting requirements of the 1933 Act, the 1933
Act Regulations, the 1934 Act and the 1934 Act Regulations, (B) any
material modifications should be made to said unaudited consolidated
financial statements for them to be in conformity with generally
accepted accounting principles, or (C) at a specified date not more
than five days prior to the date of such letter, there was any change
in the consolidated capital stock or any increase in consolidated
long-term debt of the Company and its subsidiaries or any decrease in
the consolidated net assets of the Company and its subsidiaries, in
each case as compared with the amounts shown on the most recent
consolidated balance sheet of the Company and its subsidiaries
included in the Registration Statement and the Prospectus or, during
the period from the date of such balance sheet to a specified date not
more than five days prior to the date of such letter, there were any
decreases, as compared with the corresponding period in the preceding
year, in consolidated revenues or net income of the Company and its
subsidiaries, except in each such case as set forth in or contemplated
by the Registration Statement and the Prospectus or except for such
exceptions enumerated in such letter as shall have been agreed to by
the Agents and the Company.
(iv) In addition to the examination referred to in their report
included or incorporated by reference in the Registration Statement
and the Prospectus, and the limited procedures referred to in clause
(iii) above, they have carried out certain other specified procedures,
not constituting an audit, with respect to certain amounts,
percentages and financial information which are included or
incorporated by reference in the Registration Statement and the
Prospectus and which are specified by the Agents, and have found such
amounts, percentages and financial information to be in agreement with
the relevant accounting, financial and other records of the Company
and its subsidiaries identified in such letter.
(d) Other Documents. On the date hereof and on each Settlement Date
with respect to any applicable Terms Agreement, counsel for the Agents
shall have been furnished with such documents and opinions as such counsel
may reasonably require for the purpose of enabling such counsel to pass
upon the issuance and sale of Notes as herein contemplated and related
proceedings, or in order to evidence the accuracy and completeness of any
of the representations and warranties, or the fulfillment of any of the
conditions, herein contained; and all proceedings taken by the Company in
connection with the issuance and sale of Notes as herein contemplated shall
be satisfactory in form and substance to the Agents and to counsel for the
Agents.
If any condition specified in this Section 5 shall not have been
fulfilled when and as required to be fulfilled, this Agreement (or, at the
option of the applicable Agent, any applicable Terms Agreement) may be
terminated by the Agents by notice to the Company at any time and any such
termination shall be without liability of any party to any other party,
except that the covenant regarding provision of an earning statement set
forth in Section 4(h) hereof, the provisions concerning payment of expenses
under Section 10 hereof, the indemnity and contribution agreements set
forth in Sections 8 and 9 hereof, the provisions concerning the
representations, warranties and agreements to survive delivery of Section
11 hereof and the provisions set forth under Section 15 hereof shall remain
in effect.
SECTION 6. Delivery of and Payment for Notes Sold through the Agents.
Delivery of Notes sold through an Agent as agent shall be made by the
Company to such Agent for the account of any purchaser only against payment
therefor in immediately available funds. In the event that a purchaser
shall fail either to accept delivery of or to make payment for a Note on
the date fixed for settlement, the applicable Agent shall promptly notify
the Company and deliver the Note to the Company, and, if such Agent has
theretofore paid the Company for such Note, the Company will promptly
return such funds to such Agent. If such failure occurred for any reason
other than default by such Agent in the performance of its obligations
hereunder, the Company will reimburse such Agent on an equitable basis for
its loss of the use of the funds for the period such funds were credited to
the Company?s account.
SECTION 7. Additional Covenants of the Company.
The Company covenants and agrees with the Agents that:
(a) Reaffirmation of Representations and Warranties. Each acceptance
by the Company of an offer for the purchase of Notes, and each delivery of
Notes to the applicable Agent pursuant to a Terms Agreement, shall be
deemed to be an affirmation that the representations and warranties of the
Company contained in this Agreement and in any certificate theretofore
delivered to the Agents pursuant hereto are true and correct at the time of
such acceptance or sale, as the case may be, and an undertaking that such
representations and warranties will be true and correct at the time of
delivery to the purchaser or his agent, or to the Agents, of the Note or
Notes relating to such acceptance or sale, as the case may be, as though
made at and as of each such time (and it is understood that such
representations and warranties shall relate to the Registration Statement
and Prospectus as amended and supplemented to each such time).
(b) Subsequent Delivery of Officers' Certificate. Except as
otherwise provided in Section 4(l), each time that the Registration
Statement or the Prospectus shall be amended or supplemented, including
without limitation through the filing with the SEC of any Incorporated
Document (other than any Current Report on Form 8-K relating exclusively to
the issuance of Notes under the Registration Statement, unless the Agents
shall otherwise specify) or (if required pursuant to the terms of a Terms
Agreement) the Company sells Notes to an Agent pursuant to a Terms
Agreement, the Company shall furnish or cause to be furnished to the Agents
forthwith a certificate dated the date of filing with the SEC of such
supplement or document, the date of effectiveness of such amendment, or the
date of such sale, as the case may be, in form satisfactory to the Agents
to the effect that the statements contained in the certificate referred to
in Section 5(b) hereof which was last furnished to the Agents is true and
correct at the time of such amendment, supplement, filing or sale, as the
case may be, as though made at and as of such time (except that such
statements shall be deemed to relate to (i) the Registration Statement and
the Prospectus as amended and supplemented to such time and (ii) with
respect to clause (v) of said Section 5(b), the DTE Order and any
Additional DTE Orders issued and in effect as of such time relating to the
issuance and sale of the Notes) or, in lieu of such certificate, a
certificate of the same tenor as the certificate referred to in said
Section 5(b), modified as necessary to relate to (i) the Registration
Statement and the Prospectus as amended and supplemented to the time of
delivery of such certificate and (ii) with respect to clause (v) of said
Section 5(b), the DTE Order and any Additional DTE Orders issued and in
effect as of such time relating to the issuance and sale of the Notes.
(c) Subsequent Delivery of Opinion of Company Counsel. Except as
otherwise provided in Section 4(l), each time that the Registration
Statement or the Prospectus shall be amended or supplemented, including
without limitation through the filing with the SEC of any Incorporated
Document (other than any Current Report on Form 8-K or Quarterly Report on
Form 10-Q, unless the Agent shall otherwise specify), or (if required
pursuant to the terms of a Terms Agreement) the Company sells Notes to an
Agent pursuant to a Terms Agreement, the Company shall furnish or cause to
be furnished forthwith to the Agents and to counsel to the Agents a written
opinion of Xxxxxx & Dodge LLP, counsel to the Company, dated the date of
filing with the SEC of such supplement or document, the date of
effectiveness of such amendment, or the date of such sale, as the case may
be, in form and substance satisfactory to the Agents, of the same tenor as
the opinion referred to in Section 5(a)(1) hereof, but modified, as
necessary, to relate to (i) the Registration Statement and the Prospectus
as amended and supplemented to the time of delivery of such opinion and
(ii) with respect to clause (xiv) of said Section 5(a)(1), the DTE Order
and any Additional DTE Orders issued and in effect as of such time relating
to the issuance and sale of the Notes; or, in lieu of such opinion, counsel
last furnishing such opinion to the Agents shall furnish the Agents with a
letter to the effect that the Agents may rely on such last opinion to the
same extent as though it was dated the date of such letter authorizing
reliance (except that statements in such last opinion shall be deemed to
relate to (i) the Registration Statement and the Prospectus as amended and
supplemented to the time of delivery of such letter authorizing reliance
and (ii) with respect to clause (xiv) of said Section 5(a)(1), the DTE
Order and any Additional DTE Orders issued and in effect as of such time
relating to the issuance and sale of the Notes).
(d) Subsequent Delivery of Comfort Letter. Except as otherwise
provided in Section 4(l), each time that the Registration Statement or the
Prospectus shall be amended or supplemented to include additional financial
information or there is filed with the SEC any Incorporated Document which
contains additional financial information or (if required pursuant to the
terms of a Terms Agreement) the Company sells Notes to an Agent pursuant to
a Terms Agreement, the Company shall cause the Accountants forthwith to
furnish the Agents a letter, dated the date of effectiveness of such
amendment, supplement or document with the SEC, or the date of such sale,
as the case may be, in form satisfactory to the Agents, of the same tenor
as the portions of the letter referred to in clauses (i) and (ii) of
Section 5(c) hereof but modified to relate to the Registration Statement
and Prospectus, as amended and supplemented to the date of such letter, and
of the same general tenor as the portions of the letter referred to in
clauses (iii) and (iv) of said Section 5(c) with such changes as may be
necessary to reflect changes in the financial statements and other
information derived from the accounting records of the Company; provided,
however, that if the Registration Statement or the Prospectus is amended or
supplemented solely to include financial information as of and for a fiscal
quarter, the Accountants may limit the scope of such letter to the
unaudited financial statements included in such amendment or supplement
unless any other information included therein of an accounting, financial
or statistical nature is of such a nature that, in the reasonable judgment
of the Agents, such letter should cover such other information.
(e) Subsequent Delivery of Opinion of Local Counsel. Each time that
the Company sells Notes pursuant to this Agreement or a Terms Agreement,
the Company shall furnish or cause to be furnished forthwith to the Agents
and to counsel to the Agents a written opinion of local counsel to the
Company, who shall be reasonably acceptable to the Agents, dated the date
of such sale in form and substance satisfactory to the Agents, of the same
tenor as the opinion referred to in Section 5(a)(2) hereof; or, in lieu of
such opinion, counsel last furnishing such opinion to the Agents shall
furnish the Agents with a letter to the effect that the Agents may rely on
such last opinion to the same extent as though it was dated the date of
such letter authorizing reliance.
(f) Subsequent Delivery of DTE Additional Orders. Except as
otherwise provided in Section 4(l), each time that the Company gives to the
Agents the written notification required by Section 4(a)(v) of this
Agreement, the Company shall concurrently deliver to each Agent (i) a
certified copy of each DTE Additional Order and (ii) the written opinion of
Xxxxxx & Dodge LLP to the effect that such DTE Additional Order, to the
best of such counsel's knowledge, is in full force and effect and
sufficient for the issuance and sale by the Company of the aggregate
principal amount of Additional Notes referenced in such opinion. The
Company will not request any Agent to solicit offers to purchase Notes
unless a DTE order authorizing the Company to issue and sell such Notes is
in effect.
SECTION 8. Indemnification.
(a) Indemnification of the Agents. The Company agrees to indemnify
and hold harmless each Agent and each person, if any, who controls each
Agent within the meaning of Section 15 of the 1933 Act and Section 20 of
the Exchange Act as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement
or alleged untrue statement of a material fact contained in the
Registration Statement (or any amendment thereto), or the omission or
alleged omission therefrom of a material fact necessary to make the
statements therein not misleading or arising out of any untrue
statement or alleged untrue statement of a material fact contained in
the Prospectus (or any amendment or supplement thereto) or the
omission or alleged omission therefrom of a material fact necessary to
make the statements therein, in the light of the circumstances under
which they were made, not misleading, unless (1) such untrue statement
or omission or such alleged untrue statement or omission was made in
reliance upon and in conformity with information furnished to the
Company by the Agents expressly for use in the Registration Statement
or the Prospectus or (2) any such loss, liability, claim, damage or
expense of such Agent results from the fact that such Agent sold Notes
to a person as to whom it shall be established by the Company that
there was not sent or given, at or prior to the written confirmation
of such sale, a copy of the Prospectus as then amended or supplemented
in any case where such delivery is required by the 1933 Act if the
Company has previously furnished copies thereof in sufficient quantity
to such Agent and the loss, liability, claim, damage or expense of
such Agent results from an untrue statement or omission of a material
fact contained in the Prospectus which was identified in writing at
such time to such Agent and corrected in the Prospectus as then
amended or supplemented;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount
paid in settlement of any litigation, or investigation or proceeding
by any governmental agency or body, commenced or threatened, or of any
claim whatsoever based upon any such untrue statement or omission, or
any such alleged untrue statement or omission, if such settlement is
effected with the written consent of the Company; and
(iii) against any and all expense whatsoever, as incurred
(including the fees and disbursements of counsel chosen by the
Agents), reasonably incurred in investigating, preparing or defending
against any litigation or investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, or any
such alleged untrue statement or omission, to the extent that any such
expense is not paid under (i) or (ii) above.
(b) Indemnification of Company. Each Agent agrees to indemnify and
hold harmless the Company, its directors, each of its officers who signed
the Registration Statement, and each person, if any, who controls the
Company within the meaning of Section 15 of the 1933 Act and Section 20 of
the Exchange Act against any and all loss, liability, claim, damage and
expense described in the indemnity contained in subsection (a) of this
Section, as incurred, but only with respect to untrue statements or
omissions, or alleged untrue statements or omissions, made in the
Registration Statement (or any amendment thereto) or the Prospectus (or any
amendment or supplement thereto) in reliance upon and in conformity with
written information furnished to the Company by such Agent expressly for
use in the Registration Statement (or any amendment thereto) or the
Prospectus (or any amendment or supplement thereto).
(c) General. Each indemnified party shall give prompt notice to each
indemnifying party of any action commenced against it in respect of which
indemnity may be sought hereunder, but failure to so notify an indemnifying
party shall not relieve such indemnifying party from any liability which it
may have otherwise than on account of this indemnity agreement except to
the extent that the indemnifying party is actually and substantially
prejudiced as a result of such failure. An indemnifying party may
participate at its own expense in the defense of such action and, to the
extent that it may wish, jointly with any other indemnifying party
similarly notified, to assume the defense of such action, with counsel
reasonably satisfactory to such indemnified party (who shall not, except
with the consent of the indemnified party, be counsel to the indemnifying
party), and after notice from the indemnifying party to such indemnified
party of its election so to assume the defense of such action, the
indemnifying party will not be liable to such indemnified party under this
indemnity agreement for any legal or other expenses subsequently incurred
by such indemnified party in connection with the defense of such action
other than reasonable costs of investigation. Notwithstanding the
foregoing, the indemnifying party shall not be entitled to assume the
defense of such action if (i) the indemnified party has concluded that
there may be legal defenses available to it or other indemnified parties
that are different from or in addition to those available to the
indemnifying party or (ii) a conflict or potential conflict exists (based
on advice of counsel to such indemnified party) between the indemnified
party and the indemnifying party which, as a result, in either case, would
make it inappropriate for the indemnifying party to assume such defense.
In no event shall the indemnifying parties be liable for the fees and
expenses of more than one counsel (in addition to any local counsel) for
all indemnified parties in connection with any one action or separate but
similar or related actions in the same jurisdiction arising out of the same
general allegations or circumstances.
SECTION 9. Contribution.
In order to provide for just and equitable contribution in
circumstances in which the indemnity agreement provided for in Section 8
hereof is for any reason held to be unavailable to or insufficient to hold
harmless the indemnified parties although applicable in accordance with its
terms, the Company and the Agents shall contribute to the aggregate losses,
liabilities, claims, damages and expenses of the nature contemplated by
said indemnity agreement incurred by the Company and the Agents, as
incurred, in such proportions that each Agent is responsible for that
portion represented by the percentage that the total commissions and
underwriting discounts received by such Agent to the date of such liability
bears to the total sales price from the sale of Notes sold to or through
such Agent to the date of such liability, and the Company is responsible
for the balance; provided, however, that no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the 1933 Act)
shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. For purposes of this Section, each
person, if any, who controls each Agent within the meaning of Section 15 of
the 1933 Act and Section 20 of the Exchange Act shall have the same rights
to contribution as such Agent, and each director of the Company, each
officer of the Company who signed the Registration Statement, and each
person, if any, who controls the Company within the meaning of Section 15
of the 1933 Act and Section 20 of the Exchange Act shall have the same
rights to contribution as the Company.
SECTION 10. Payment of Expenses.
Except as set forth in a Terms Agreement, the Company will pay all
expenses incident to the performance of its obligations under this
Agreement, including:
(a) The preparation and filing of the Registration Statement and
all amendments thereto and the Prospectus and any amendments or
supplements thereto;
(b) The preparation, filing and reproduction of this Agreement;
(c) The preparation, printing, issuance and delivery of the
Notes, including any fees and expenses relating to the use of
book-entry notes;
(d) The fees and disbursements of the Accountants and its
counsel and of the Trustee and its counsel;
(e) The reasonable fees and disbursements of counsel to the
Agents incurred from time to time in connection with the transactions
contemplated hereby;
(f) The qualification of the Notes under state securities laws
in accordance with the provisions of Section 4(i) hereof, including
filing fees and the reasonable fees and disbursements of counsel for
the Agents in connection therewith and in connection with the
preparation of any blue sky survey;
(g) The printing and delivery to the Agents in quantities as
hereinabove stated of copies of the Registration Statement and any
amendments thereto, and of the Prospectus and any amendments or
supplements thereto, and the delivery by the Agents of the Prospectus
and any amendments or supplements thereto in connection with
solicitations or confirmations of sales of the Notes;
(h) The preparation, printing, reproducing, recordation and
delivery to the Agents of copies of the Supplemental Indenture and all
supplements and amendments thereto;
(i) Any fees charged by rating agencies for the rating of the
Notes;
(j) The fees and expenses, if any, incurred with respect to any
filing with the National Association of Securities Dealers, Inc.;
(k) Any advertising and other out-of-pocket expenses of the
Agents incurred with the approval of the Company;
(l) The cost of preparing, and providing any CUSIP or other
identification numbers for, the Notes;
(m) The fees and expenses of any depository and any nominees
thereof in connection with the Notes; and
(n) The fees and expenses, if any, incurred in connection with
any filing with or approval by the DTE in connection with the issuance
of the Notes.
SECTION 11. Representations, Warranties and Agreements to Survive
Delivery.
All representations, warranties and agreements contained in this
Agreement or in certificates of officers of the Company submitted pursuant
hereto or thereto, shall remain operative and in full force and effect,
regardless of any investigation made by or on behalf of the Agents or any
controlling person of any Agent, or by or on behalf of the Company, and
shall survive each delivery of and payment for any of the Notes.
SECTION 12. Termination.
(a) Termination of this Agreement. This Agreement (excluding any
Terms Agreement) may be terminated for any reason, at any time by either
the Company or an Agent upon the giving of 30 days' written notice of such
termination to the other party hereto.
(b) Termination of a Terms Agreement. The applicable Agent may
terminate any Terms Agreement, immediately upon notice to the Company, at
any time prior to the Settlement Date relating thereto (i) if there has
been, since the date of such Terms Agreement or since the respective dates
as of which information is given in the Registration Statement, any
material adverse change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise, whether or not arising in the
ordinary course of business, or (ii) if there shall have occurred any
material adverse change in the financial markets in the United States or
any outbreak or escalation of hostilities or other national or
international calamity or crisis the effect of which is such as to make it,
in the judgment of such Agent, impracticable to market the Notes or enforce
contracts for the sale of the Notes, or (iii) if trading in any securities
of the Company has been suspended by the SEC or a national securities
exchange, or if trading generally on either the American Stock Exchange or
the New York Stock Exchange shall have been suspended, or minimum or
maximum prices for trading have been fixed, or maximum ranges for prices
for securities have been required, by either of said exchanges or by order
of the SEC or any other governmental authority, or if a banking moratorium
shall have been declared by either Federal or New York authorities, or (iv)
if the rating assigned by any nationally recognized securities rating
agency to any debt securities of the Company as of the date of any
applicable Terms Agreement shall have been lowered since that date or if
any such rating agency shall have publicly announced that it has under
surveillance or review, with possible negative implications, its rating of
any debt securities of the Company, or (v) if there shall have come to the
applicable Agent's attention any facts that would cause such Agent to
believe that the Prospectus, at the time it was required to be delivered to
a purchaser of Notes, contained an untrue statement of a material fact or
omitted to state a material fact necessary in order to make the statements
therein, in the light of the circumstances existing at the time of such
delivery, not misleading.
(c) General. In the event of any such termination, neither party
will have any liability to the other party hereto, except that (i) each
Agent shall be entitled to any commission earned in accordance with the
third paragraph of Section 3(a) hereof, (ii) if at the time of termination
(a) each Agent shall own any Notes purchased pursuant to a Terms Agreement
with the intention of reselling them or (b) an offer to purchase any of the
Notes has been accepted by the Company but the time of delivery to the
purchaser or his agent of the Note or Notes relating thereto has not
occurred, the covenants set forth in Sections 4 and 7 hereof shall remain
in effect until such Notes are so resold or delivered, as the case may be,
and (iii) the covenant set forth in Section 4(h) hereof, the provisions of
Section 5 hereof, the indemnity and contribution agreements set forth in
Sections 8 and 9 hereof, and the provisions of Sections 10, 11 and 15
hereof shall remain in effect.
SECTION 13. Notices.
Unless otherwise provided herein, all notices required under the terms
and provisions hereof shall be in writing, either delivered by hand, by
mail or by telex, telecopier or telegram, and any such notice shall be
effective when received at the address specified below.
If to the Company:
Colonial Gas Company
00 Xxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxx, CPA
Vice President and Treasurer
If to the Agents:
Salomon Brothers Inc
Seven World Trade Center
New York, New York 10048
Attention: Xxxxxxxx Xxxxxxxx,
Legal Department, 32nd Floor
X.X. Xxxxxxx & Sons, Inc.
Xxx Xxxxx Xxxxxxxxx Xxxxxx
Xx. Xxxxx, Xxxxxxxx 00000
Attention: Debt Syndicate, Xxxxx Xxxx-Xxxxxxxxx
Xxxxxxx Xxxxx & Co.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
World Financial Center
North Tower, 10th Floor
New York, New York 10281-1310
Attention: MTN Product Management
or at such other address as such party may designate from time to time by
notice duly given in accordance with the terms of this Section 13.
SECTION 14. Governing Law.
The rights and duties of the Company and the Agents under this
Agreement shall, pursuant to New York General Obligations Law Section
5-1401, be governed by the law of the State of New York. Any suit, action
or proceeding brought by the Company against the Agents in connection with
or arising under this Agreement shall be brought solely in the state or
federal court of appropriate jurisdiction located in the Borough of
Manhattan, The City of New York.
SECTION 15. Parties.
This Agreement shall inure to the benefit of and be binding upon the
Agents and the Company and their respective successors. Nothing expressed
or mentioned in this Agreement is intended or shall be construed to give
any person, firm or corporation, other than the parties hereto and their
respective successors and the controlling persons and officers and
directors referred to in Sections 8 and 9 and their heirs and legal
representatives, any legal or equitable right, remedy or claim under or in
respect of this Agreement or any provision herein contained. This
Agreement and all conditions and provisions hereof are intended to be for
the sole and exclusive benefit of the parties hereto and respective
successors and said controlling persons and officers and directors and
their heirs and legal representatives, and for the benefit of no other
person, firm or corporation. No purchaser of Notes shall be deemed to be a
successor by reason merely of such purchase.
If the foregoing is in accordance with the Agents' understanding of
our agreement, please sign and return to the Company a counter-part hereof,
whereupon this instrument along with all counter-parts will become a
binding agreement between the Agents and the Company in accordance with its
terms.
Very truly yours,
Colonial Gas Company
By:
Name:
Title:
Accepted:
Salomon Brothers Inc
By: ________________________________
Name:
Title:
X.X. Xxxxxxx & Sons, Inc.
By: ________________________________
Name:
Title:
Xxxxxxx Xxxxx & Co.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
By: ________________________________
Name:
Title:
SCHEDULE A
As compensation for the services of the Agents hereunder, the Company
shall pay the applicable Agent, on a discount basis, a commission for the
sale of each Note equal to the principal amount of such Note multiplied by
the appropriate percentage set forth below:
PERCENT OF
MATURITY RANGES PRINCIPAL AMOUNT
From 9 months but less than 1 year .125%
From 1 year but less than 18 months .150
From 18 months but less than 2 years .200
From 2 years but less than 3 years .250
From 3 years but less than 4 years .350
From 4 years but less than 5 years .450
From 5 years but less than 6 years .500
From 6 years but less than 7 years .550
From 7 years but less than 10 years .600
From 10 years but less than 15 years .625
From 15 years but less than 20 years .700
From 20 years to and including 30 years .750
More than 30 years *
* Commission on Notes with maturities of more than 30 years shall be
agreed to by the Company and the applicable Agent at the time of such
transaction.
EXHIBIT A
The following terms, if applicable, shall be agreed to by the
applicable Agent and the Company pursuant to each Terms Agreement:
Principal Amount: $_______
Interest Rate:
Interest Payment Dates:
If Redeemable at the Option of the Company:
Initial Redemption Date:
Initial Redemption Percentage:
Annual Redemption Percentage Reduction:
Other Redemption Terms:
If Repayable at the Option of the Holder:
Optional Repayment Date(s):
Optional Repayment Price(s):
Date of Maturity:
Purchase Price: ___%, plus accrued interest,
if any, from _________
Price to Public: ___%, plus accrued interest,
if any, from _________
Settlement Date and Time:
Stand-off Period (if any):
Provisions applicable to the failure of any Agents (if more
than one) to purchase and pay for the Notes it has agreed
to purchase and pay for hereunder:
Additional Terms:
Also, agreement as to whether the following will be required:
Officer's Certificate pursuant to Section 7(b)
of the Distribution Agreement.
Legal Opinion pursuant to Section 7(c)of the
Distribution Agreement.
Comfort Letter pursuant to Section 7(d) of the
Distribution Agreement.
Stand-off Agreement pursuant to Section 4(k) of the
Distribution Agreement.
EXHIBIT B
Administrative Procedures For
Colonial Gas Company
Secured Medium Term Notes, Series B
Due From 9 Months to 40 Years From Date Of Issue
(Dated as of March __, 1998)
Secured Medium Term Notes, Series B (the "Notes") in the aggregate
principal amount of up to $75,000,000 are to be offered on a continuing
basis by Colonial Gas Company (the "Company") through Salomon Brothers Inc,
X.X. Xxxxxxx & Sons, Inc. and Xxxxxxx Xxxxx & Co., Xxxxxxx Lynch, Xxxxxx,
Xxxxxx & Xxxxx Incorporated who, as agents (each an "Agent," and,
collectively, the "Agents"), have agreed to use their reasonable efforts to
solicit offers to purchase the Notes from the Company. The Agents may also
purchase Notes as principal for resale.
The Notes are being sold pursuant to a Distribution Agreement between
the Company and the Agents, dated March __, 1998 (the "Distribution
Agreement"). The Notes are to be issued as a new series of first mortgage
bonds under the Company's Second Amended and Restated First Mortgage
Indenture to State Street Bank and Trust Company, as trustee, dated as of
June 15, 1992, as heretofore supplemented and as it is to be further
supplemented by a Fourth Supplemental Indenture, dated as of March __, 1998
(said First Mortgage Indenture, as heretofore supplemented and as it is to
be further supplemented, the "Mortgage"). The Registration Statement (as
defined in the Distribution Agreement) with respect to the Notes has been
filed with the Securities and Exchange Commission (the "Commission"). The
Prospectus included in the Registration Statement is herein referred to as
the "Prospectus." A pricing supplement with respect to the specific terms
of any Notes is herein referred to as a "Pricing Supplement."
The Notes will either be issued (a) in book-entry form (a "Book-Entry
Note or Notes") and represented by one or more fully registered Notes
(each, a "Global Note or Notes") delivered to the Trustee, as agent for The
Depository Trust Company ("DTC"), and recorded in the book-entry system
maintained by DTC, or (b) in certificated form (each, a "Certificated Note
or Notes") delivered to the purchaser thereof or a person designated by
such purchaser. Except in the limited circumstances described in the
Prospectus or a Pricing Supplement, owners of beneficial interests in
Book-Entry Notes will not be entitled to physical delivery of Certificated
Notes equal in principal amount to their respective beneficial interests.
General procedures relating to the issuance of all Notes are set forth
in Part I hereof. Additionally, Book-Entry Notes will be issued in
accordance with the procedures set forth in Part II hereof and Certificated
Notes will be issued in accordance with the procedures set forth in Part
III hereof.
PART I: PROCEDURES OF GENERAL
APPLICABILITY
Date of Issuance/
Authentication:
Each Note will be dated as of the date of its
authentication by the Trustee. Each Note
shall also bear an original issue date (each,
an "Original Issue Date"). The Original Issue
Date shall remain the same for all Notes
subsequently issued upon transfer, exchange or
substitution of an original Note regardless of
their dates of authentication.
Maturities:
Each Note will mature on a date which is not
less than nine months nor more than forty
years from its Original Issue Date (the
"Stated Maturity Date") selected by the
investor or other purchaser and agreed to by
the Company.
Registration:
Unless otherwise provided in the applicable
Pricing Supplement, Notes will be issued only
in fully registered form.
Denominations:
Unless otherwise provided in the applicable
Pricing Supplement, the Notes will be issued
in denominations of $1,000 and integral
multiples thereof.
Redemption/Repayment:
The Notes will be subject to redemption by the
Company in accordance with the terms of the
Notes, which will be fixed at the time of sale
and set forth in the applicable Pricing
Supplement. If no initial redemption date is
indicated with respect to a Note, such Note
will not be redeemable prior to its Stated
Maturity Date.
The Notes will be subject to repayment at the
option of the holders thereof in accordance
with the terms of the Notes, which will be
fixed at the time of sale and set forth in the
applicable Pricing Supplement. If no optional
repayment date is indicated with respect to a
Note, such Note will not be repayable at the
option of the holder prior to its Stated
Maturity Date.
Calculation of Interest:
Interest (including payments for partial
periods) will be calculated and paid on the
basis of a 360-day year of twelve 30-day
months.
Interest:
General. Each Note will bear interest in
accordance with its terms. Unless otherwise
provided in the applicable Pricing Supplement,
interest on each Note will accrue from and
including the Original Issue Date of such Note
for the first interest period or from the most
recent Interest Payment Date (as defined
below) to which interest has been paid or duly
provided for all subsequent interest periods
to but excluding the applicable Interest
Payment Date or the Stated Maturity Date or
date of earlier redemption or repayment, as
the case may be (the Stated Maturity Date or
date of earlier redemption or repayment is
referred to herein as the "Maturity Date" with
respect to the principal repayable on such
date).
If an Interest Payment Date or the Maturity
Date with respect to any Note falls on a day
that is not a Business Day (as defined below),
the required payment to be made on such day
need not be made on such day, but may be made
on the next succeeding Business Day with the
same force and effect as if made on such day,
and no interest shall accrue on such payment
for the period from and after such day to the
next succeeding Business Day. "Business Day"
means any day, other than a Saturday or
Sunday, that is neither a legal holiday nor a
day on which banking institutions are
authorized or required by law, regulation or
executive order to close in The City of New
York or the City of Boston.
Interest Payment Dates. Interest payments
will be made on the Maturity Date and each
Interest Payment Date commencing with the
first Interest Payment Date following the
Original Issue Date.
Interest payments on the Notes will be made
semi-annually in arrears on the dates set
forth in the applicable Pricing Supplement and
on the Maturity Date.
Acceptance and Rejection
of Offers:
The Company shall have the sole right to
accept offers to purchase Notes from the
Company and may reject any such offer in whole
or in part. Each Agent shall communicate to
the Company, orally or in writing, each
reasonable offer to purchase Notes from the
Company received by it. Each Agent shall have
the right, in its discretion reasonably
exercised, without notice to the Company, to
reject any offer to purchase Notes through it
in whole or in part.
Preparation of Pricing
Supplement:
If any offer to purchase a Note is accepted by
the Company, the Company, with the approval of
the Agent which presented such offer (the
"Presenting Agent"), will prepare a Pricing
Supplement reflecting the terms of such Note
and file such Pricing Supplement relating to
such Notes and the plan of distribution
thereof (as such Pricing Supplement
supplements the Prospectus, the "Supplemented
Prospectus"), with the Commission in
accordance with Rule 424 under the Act. The
Presenting Agent will cause a Supplemented
Prospectus to be delivered to the purchaser of
the Note.
The Company shall have delivered a completed
Pricing Supplement, via next day mail or
telecopy to arrive no later than 11 AM on the
Business Day following the trade date, to the
Presenting Agent at the following locations:
Salomon Brothers Inc at the following address:
Salomon Brothers Inc, Seven World Trade
Center, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Legal Department -- Xxxxxxxx
Xxxxxxxx, Telephone: (000) 000-0000, Telecopy:
(000) 000-0000; to X.X. Xxxxxxx & Sons, Inc.
at the following address: X.X. Xxxxxxx &
Sons, Inc., Xxx Xxxxx Xxxxxxxxx Xxxxxx, Xx.
Xxxxx, Xxxxxxxx 00000, Attention: Debt
Syndicate -- Xxxxx Xxxx-Xxxxxxxxx, Telephone:
(000) 000-0000, Telecopy: (000) 000-0000; and
to Xxxxxxx Xxxxx & Co., Xxxxxxx Lynch, Xxxxxx,
Xxxxxx & Xxxxx Incorporated at the following
address: Tritech Services, 00 Xxxxxxxx Xxxxx,
Xxxxxxxxxx, Xxx Xxxxxx 00000, Attention:
Prospectus Operations/Xxxxxxx Xxxxxxxxx,
Telephone: (000) 000-0000, Telecopy: (908)
885-2774, with a copy to: Xxxxxxx Xxxxx &
Co., Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated, World Financial Center, North
Tower, 10th Floor, New York, New York
10281-1310, Attention: MTN Product
Management, Telephone: (000) 000-0000,
Telecopy: (000) 000-0000. Also, a copy
should be sent to Winthrop, Stimson, Xxxxxx &
Xxxxxxx, Xxx Xxxxxxx Xxxx Xxxxx, Xxx Xxxx, Xxx
Xxxx 00000, Attention: Xxxxx X. Xxxxx, Esq.,
Telephone: (000) 000-0000, Telecopy: (212)
858-1500.
In each instance that a Pricing Supplement is
prepared, the Agents will affix such Pricing
Supplement to the Prospectus prior to its use.
Outdated Pricing Supplements, and the
Prospectuses to which they are attached (other
than those retained for files), will be
destroyed.
Settlement:
The receipt of immediately available funds by
the Company in payment for a Note and the
authentication and delivery of such Note
shall, with respect to such Note, constitute
"settlement." Offers accepted by the Company
will be settled on the date that is three
Business Days after the date of the acceptance
of the offer, or at such later time as the
purchaser, the Trustee and the Company shall
agree, pursuant to the timetable for
settlement set forth in Parts II and III
hereof under the caption "Settlement
Procedures" with respect to Global Notes and
Certificated Notes, respectively. If
procedures A and B of the applicable
Settlement Procedures with respect to a
particular offer are not completed on or
before the time set forth under the applicable
"Settlement Procedures Timetable," such offer
shall not be settled until the Business Day
following the completion of settlement
procedures A and B or such later date as the
purchaser and the Company shall agree.
In the event of a purchase of Notes by any
Agent as principal, appropriate settlement
details will be as agreed between the Agent
and the Company pursuant to the applicable
Terms Agreement.
Suspension of Solicitation;
Amendment or Supplement:
The Company may instruct the Agents to suspend
solicitation of purchases at any time. Upon
receipt of such instructions the Agents will
forthwith suspend solicitation of offers to
purchase from the Company until such time as
the Company has advised them that solicitation
of offers to purchase may be resumed. If the
Company decides to amend the Registration
Statement (including incorporating any
documents by reference therein) or supplement
any of such documents, it will promptly
furnish the Agents and their counsel with
copies of the amendment (including any
document proposed to be incorporated by
reference therein) or supplement. One copy of
such filed document, along with a copy of the
cover letter sent to the Commission, will be
telecopied or mailed to the Agents at the
following respective addresses: Salomon
Brothers Inc, Seven World Trade Center, 00xx
Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Telecopy:
(000) 000-0000, Attention: Legal Department -
Xxxxxxxx Xxxxxxxx; X.X. Xxxxxxx & Sons, Inc.,
Xxx Xxxxx Xxxxxxxxx Xxxxxx, Xx. Xxxxx,
Xxxxxxxx 00000, Telecopy: (000) 000-0000,
Attention: Debt Syndicate -- Xxxxx
Xxxx-Xxxxxxxxx; and to Xxxxxxx Xxxxx & Co.,
Xxxxxxx Lynch, Xxxxxx, Xxxxxx & Xxxxx
Incorporated, World Financial Center, North
Tower, 10th Floor, New York, New York
10281-1310, Attention: MTN Product
Management, Telecopy: (000) 000-0000. A copy
of such filed document should also be
telecopied or mailed to Winthrop, Stimson,
Xxxxxx & Xxxxxxx, Xxx Xxxxxxx Xxxx Xxxxx, Xxx
Xxxx, Xxx Xxxx 00000, Attention: Xxxxx X.
Xxxxx, Esq., Telecopy: (000) 000-0000.
In the event that at the time the solicitation
of offers to purchase from the Company is
suspended there shall be any orders
outstanding which have not been settled, the
Company will promptly advise the Agents and
the Trustee whether such orders may be settled
and whether copies of the Prospectus as
theretofore amended and/or supplemented as in
effect at the time of the suspension may be
delivered in connection with the settlement of
such orders. The Company will have the sole
responsibility for such decision and for any
arrangements which may be made in the event
that the Company determines that such orders
may not be settled or that copies of such
Prospectus may not be so delivered.
Delivery of Supplemented
Prospectus:
A copy of the most recent Supplemented
Prospectus must accompany or precede the
earlier of (a) the written confirmation of a
sale sent to a customer or the agent of such
customer, and (b) the delivery of Notes to a
customer or the agent of such customer.
Authenticity of
Signatures:
The Agents will have no obligation or
liability to the Company or the Trustee in
respect of the authenticity of the signature
of any officer, employee or agent of the
Company or the Trustee on any Note.
Documents Incorporated by
Reference:
The Company shall supply the Agents with an
adequate supply of all documents incorporated
by reference in the Registration Statement.
PART II: PROCEDURES FOR BOOK-ENTRY NOTES
In connection with the qualification of Book-Entry Notes for
eligibility in the book-entry system maintained by DTC, the Trustee will
perform the custodial, document control and administrative functions
described below, in accordance with its respective obligations under a
Letter of Representation from the Company and the Trustee to DTC, dated
March __, 1998, and a Medium Term Note Certificate Agreement, dated August
21, 1989, between the Trustee and DTC (the "Certificate Agreement"), and
its obligations as a participant in DTC, including DTC's Same-Day Funds
Settlement System ("SDFS").
Issuance:
All Book-Entry Notes having the same Original
Issue Date, interest rate and Stated Maturity
will be represented initially by a single
Global Note. Owners of beneficial interests
in Global Notes will be entitled to physical
delivery of Certificated Notes equal in
principal amount to their respective
beneficial interests only upon certain limited
circumstances described in the Prospectus.
Identification:
The Company has arranged with the CUSIP
Service Bureau of Standard & Poor's
Corporation (the "CUSIP Service Bureau") for
the reservation of approximately 900 CUSIP
numbers which have been reserved for and
relating to Global Notes and the Company has
delivered to the Trustee and DTC a written
list of such CUSIP numbers. The Trustee will
assign CUSIP numbers to Global Notes as
described below under Settlement Procedure B.
DTC will notify the CUSIP Service Bureau
periodically of the CUSIP numbers that the
Trustee has assigned to Global Notes.
The Trustee will notify the Company at any
time when fewer than 50 of the reserved CUSIP
numbers remain unassigned to Global Notes,
and, if it deems necessary, the Company will
reserve additional CUSIP numbers for
assignment to Global Notes. Upon obtaining
such additional CUSIP numbers, the Company
will deliver a list of such additional numbers
to the Trustee and DTC.
Registration:
Each Global Note will be registered in the
name of Cede & Co., as nominee for DTC, on the
register maintained by the Trustee under the
Mortgage. The beneficial owner of a
Book-Entry Note (i.e., an owner of a
beneficial interest in a Global Note) (or one
or more indirect participants in DTC
designated by such owner) will designate one
or more participants in DTC (with respect to
such Note issued in book-entry form, the
"Participants") to act as agent for such
beneficial owner in connection with the
book-entry system maintained by DTC, and DTC
will record in book-entry form, in accordance
with instructions provided by such
Participants, a credit balance with respect to
such Book-Entry Note in the account of such
Participants. The ownership interest of such
beneficial owner in such Book-Entry Note will
be recorded through the records of such
Participants or through the separate records
of such Participants and one or more indirect
participants in DTC.
Transfers:
Transfers of a Global Note will be
accomplished by book entries made by DTC and,
in turn, by Participants (and in certain
cases, one or more indirect participants in
DTC) acting on behalf of beneficial
transferors and transferees of such Global
Note.
Exchanges:
The Trustee may deliver to DTC and the CUSIP
Service Bureau at any time a written notice
specifying (a) the CUSIP numbers of two or
more Global Notes outstanding on such date
that represent Global Notes having the same
terms (other than Original Issue Dates) and
for which interest has been paid to the same
date; (b) a date, occurring at least 30 days
after such written notice is delivered and at
least 30 days before the next Interest Payment
Date for the related Book-Entry Notes, on
which such Global Notes shall be exchanged for
a single replacement Global Note; and (c) a
new CUSIP number, obtained from the Company,
to be assigned to such replacement Global
Note. Upon receipt of such a notice, DTC will
send to its participants (including the
Trustee) a written reorganization notice to
the effect that such exchange will occur on
such date. Prior to the specified exchange
date, the Trustee will deliver to the CUSIP
Service Bureau written notice setting forth
such exchange date and the new CUSIP number
and stating that, as of such exchange date,
the CUSIP numbers of the Global Notes to be
exchanged will no longer be valid. On the
specified exchange date, the Trustee will
exchange such Global Notes for a single Global
Note bearing the new CUSIP numbers and the
CUSIP number of the exchanged Global Notes
will, in accordance with CUSIP Service Bureau
procedures, be canceled and not immediately
reassigned.
Payments of Principal,
Premium, if any,
and Interest:
Payment of Interest Only. Promptly fifteen
days prior to each Interest Payment Date, the
Trustee will deliver to the Company and DTC a
written notice specifying by CUSIP number the
amount of interest to be paid on each Global
Note on the following Interest Payment Date
(other than an Interest Payment Date
coinciding with the Maturity Date) and the
total of such amounts. DTC will confirm the
amount payable on each Global Note on such
Interest Payment Date by reference to the
daily bond reports published by Standard &
Poor's. On such Interest Payment Date, the
Company will pay to the Trustee, and the
Trustee in turn will pay to DTC, such total
amount of interest due (other than at the
Maturity Date), at the times and in the manner
set forth below under "Manner of Payment."
Payments at Maturity. On or about the first
Business Day of each month in which principal,
premium, if any, and interest is to be paid,
the Trustee will deliver to the Company and
DTC a written list of principal, premium, if
any, and interest to be paid on each Global
Note maturing or otherwise becoming due in the
following month. The Trustee, the Company and
DTC will confirm the amounts of such
principal, premium, if any, and interest
payments with respect to each such Global Note
on or about the fifth Business Day preceding
the Maturity Date of such Global Note. On the
Maturity Date, the Company will pay to the
Trustee, and the Trustee in turn will pay to
DTC, the principal amount of such Global Note,
together with interest and premium, if any,
due on the Maturity Date, at the times and in
the manner set forth below under "Manner of
Payment." Promptly after payment to DTC of
the principal, interest and premium, if any,
due on the Maturity Date of such Global Note,
the Trustee will cancel such Global Note and
deliver it to the Company with an appropriate
debit advice. On the first Business Day of
each month, the Trustee will deliver to the
Company a written statement indicating the
total principal amount of outstanding Global
Notes as of the immediately preceding Business
Day.
Manner of Payment. The total amount of any
principal, premium, if any, and interest due
on Global Notes on any Interest Payment Date
or on the Maturity Date shall be transferred
by the Company to the Trustee to an account
designated by the Trustee in funds available
for use by the Trustee as of 9:30 a.m., New
York City time, on such date. The Company
will confirm such instructions in writing to
the Trustee. Prior to 10:00 a.m., New York
City time, on such date or as soon as possible
thereafter, the Trustee will pay (but only
from funds withdrawn from such account) by
separate wire transfer (using Fedwire message
entry instructions in a form previously
specified by DTC) to an account at the Federal
Reserve Bank of New York previously specified
by DTC, in funds available for immediate use
by DTC, each payment of interest, principal
and premium, if any, due on a Global Note on
such date. Thereafter on such date, DTC will
pay, in accordance with its SDFS operating
procedures then in effect, such amounts in
funds available for immediate use to the
respective Participants in whose names the
beneficial interests in such Global Notes are
recorded in the book-entry system maintained
by DTC. Neither the Company nor the Trustee
shall have any responsibility or liability for
the payment by DTC of the principal of and
premium, if any, or interest on, such Global
Notes to such Participants.
Withholding Taxes. The amount of any taxes
required under applicable law to be withheld
from any interest payment on a Global Note
will be determined and withheld by the
Participant, indirect participant in DTC or
other Person responsible for forwarding
payments and materials directly to the
beneficial owner of such Global Note.
Settlement Procedures:
|
Settlement Procedures with regard to each
Book-Entry Note sold by each Agent as agent of
the Company, will be as follows:
A. The Presenting Agent will advise the
Company by telephone (confirmed by facsimile)
of the following settlement information:
1. Taxpayer identification number of the
purchaser.
2. Principal amount.
3. Terms:
a) interest rate
b) interest payment dates
4. Price to public.
5. Trade date.
6. Settlement date (Original Issue Date).
7. Stated Maturity Date.
8. Net proceeds to the Company.
9. Presenting Agent's discount or
commission.
10. Purchase Price.
11. Redemption provisions, if any.
12. Repayment provisions, if any.
13. Whether such Note is being sold to the
Presenting Agent as principal or to an
investor or other purchaser through the
Presenting Agent acting as agent for the
Company.
14. Such other information specified with
respect to such Note.
B. The Company will advise the Trustee by
electronic transmission of the above
settlement information received from the
Presenting Agent with respect to the Global
Note representing such Book-Entry Note and the
name of the Presenting Agent, and the Trustee
will assign a CUSIP number to such Global
Note.
C. The Trustee will communicate to DTC through
DTC's Participant Terminal System, a pending
deposit message specifying the following
settlement information:
1. The information set forth in
Settlement Procedure A.
2. Identification numbers of the
participant accounts maintained by DTC on
behalf of the Trustee and the Presenting
Agent.
3. Initial Interest Payment Date for such
Global Note and, if then calculable, the
amount of interest payable on such Interest
Payment Date (which amount shall have been
confirmed by the Trustee).
4. CUSIP number of the Global Note
representing such Book-Entry Note.
5. Whether such Global Note represents
any other Book-Entry Notes.
D. The Board of Directors of the Company or
its Executive Committee or a designee thereof
shall approve the final terms of the Global
Notes.
E. The Trustee will complete the Global Note
representing such Book-Entry Note in a form
that has been approved by the Company, the
Agents and the Trustee.
F. The Trustee will authenticate the Global
Note representing such Book-Entry Note.
G. DTC will credit such Book-Entry Note to the
participant account of the Trustee maintained
by DTC.
H. The Trustee will enter an SDFS deliver
order through DTC's Participating Terminal
System instructing DTC (i) to debit such
Book-Entry Note to the Trustee's participant
account and credit such Book-Entry Note to the
participant account of the Presenting Agent
maintained by DTC and (ii) to debit the
settlement account of the Presenting Agent and
credit the settlement account of the Trustee
maintained by DTC, in an amount equal to the
price of such Book-Entry Note less such
Presenting Agent's discount or commission.
Any entry of such a deliver order shall be
deemed to constitute a representation and
warranty by the Trustee to DTC that (i) the
Global Note representing such Book-Entry Note
has been issued and authenticated and (ii) the
Trustee is holding such Global Note pursuant
to the Certificate Agreement.
I. The Presenting Agent will enter an SDFS
deliver order through DTC's Participant
Terminal System instructing DTC (i) to debit
such Book-Entry Note to the Presenting Agent's
participant account and credit such Book-Entry
Note to the participant account of the
Participants maintained by DTC and (ii) to
debit the settlement accounts of such
Participants and credit the settlement account
of the Presenting Agent maintained by DTC, in
an amount equal to the initial public offering
price of such Book-Entry Note.
J. Transfers of funds in accordance with SDFS
deliver orders described in Settlement
Procedures H and I will be settled in
accordance with SDFS operating procedures in
effect on the Settlement Date.
K. Upon receipt of such funds, the Trustee
will credit to an account of the Company
identified to the Trustee funds available for
immediate use in the amount transferred to the
Trustee in accordance with Settlement
Procedure H.
L. The Trustee will send a copy of the Global
Note to the Company together with a statement
setting forth the principal amount of Notes
outstanding in accordance with the Mortgage.
M. The Agent will confirm the purchase of such
Book-Entry Note to the purchaser either by
transmitting to the Participant with respect
to such Book-Entry Note a confirmation order
through DTC's Participant Terminal System or
by mailing a written confirmation to such
purchaser.
Settlement Procedures
Timetable:
For order of Notes accepted by the Company,
Settlement Procedures "A" through "M" set
forth above shall be completed as soon as
possible but not later than the respective
times (New York City time) set forth below:
Settlement
Procedure Time
A-B 11:00 a.m. on the trade date
C 2:00 p.m. on the trade date
D No later than the Business Day before day
of settlement
E-F 3:00 p.m. on the Business Day before day of
settlement
G 10:00 a.m. on day of settlement
H-I No later than 2:00 p.m. on the day
prior to day of settlement
J 4:45 p.m. on day of settlement
K-M 5:00 p.m. on day of settlement
Settlement Procedures A, B and C may, if
necessary, be completed at any time prior to
the specified times on the first Business Day
after the sale date. Settlement Procedure J
is subject to extension in accordance with any
extension of Fedwire closing deadlines and in
the other events specified in the SDFS
operating procedures in effect on the day of
settlement.
If settlement of a Book-Entry Note is
rescheduled or canceled, the Trustee will
deliver to DTC, through DTC's Participant
Terminal System, a cancellation message to
such effect by no later than 2:00 p.m., New
York City time, on the Business Day
immediately preceding the scheduled day of
settlement.
Failure to Settle:
If the Trustee fails to enter an SDFS deliver
order with respect to a Book-Entry Note
pursuant to Settlement Procedure H, the
Trustee may deliver to DTC, through DTC's
Participant Terminal System, as soon as
practicable a withdrawal message instructing
DTC to debit such Book-Entry Note to the
participant account of the Trustee maintained
at DTC. DTC will process the withdrawal
message, provided that such participant
account contains a principal amount of the
Global Note representing such Book-Entry Note
that is at least equal to the principal amount
to be debited. If withdrawal messages are
processed with respect to all the Book-Entry
Notes represented by a Global Note, the
Trustee will mark such Global Note "canceled",
make appropriate entries in its records and
send such canceled Global Note to the Company.
The CUSIP number assigned to such Global Note
shall, in accordance with CUSIP Service Bureau
procedures, be canceled and not immediately
reassigned. If withdrawal messages are
processed with respect to a portion of the
Book-Entry Notes represented by a Global Note,
the Trustee will exchange such Global Note for
two Global Notes, one of which shall represent
the Global Notes for which withdrawal messages
are processed and shall be canceled
immediately after issuance, and the other of
which shall represent the other Book-Entry
Notes previously represented by the
surrendered Global Note and shall bear the
CUSIP number of the surrendered Global Note.
If the purchase price for any Book-Entry Note
is not timely paid to the Participants with
respect to such Book-Entry Note by the
beneficial purchaser thereof (or a person,
including an indirect participant in DTC,
acting on behalf of such purchaser), such
Participants and, in turn, the related Agent
may enter SDFS deliver orders through DTC's
Participant Terminal System reversing the
orders entered pursuant to Settlement
Procedures H and I, respectively. Thereafter,
the Trustee will deliver the withdrawal
message and take the related actions described
in the preceding paragraph. If such failure
shall have occurred for any reason other than
default by the applicable Agent to perform its
obligations hereunder or under the
Distribution Agreement, the Company will
reimburse such Agent on an equitable basis for
its loss of the use of funds during the period
when the funds were credited to the account of
the Company.
Notwithstanding the foregoing, upon any
failure to settle with respect to a Book-Entry
Note, DTC may take any actions in accordance
with its SDFS operating procedures then in
effect. In the event of a failure to settle
with respect to a Book-Entry Note that was to
have been represented by a Global Note also
representing other Book-Entry Notes, the
Trustee will provide, in accordance with
Settlement Procedures E and F, for the
authentication and issuance of a Global Note
representing such remaining Book-Entry Notes
and will make appropriate entries in its
records.
PART III: PROCEDURES FOR CERTIFICATED NOTES
Payments of Principal,
Premium, if any and Interest:
Principal of and premium, if any, and interest
on the Certificated Notes, will be payable in
immediately available funds to Registered
Owners (as defined herein) at the principal
corporate trust office in Boston,
Massachusetts of the Trustee or, at the option
of such Registered Owner, at such other office
or agency of the Trustee, at such other office
or agency of the Company in New York, New York
or otherwise pursuant to the Mortgage. The
record dates for any payment of interest will
be set forth in the Certificated Notes.
The Trustee will provide to the Company in
each month prior to a month in which any
Certificated Note or Notes mature, a list of
the principal and interest to be paid on
Certificated Notes maturing in the next
succeeding month. The Trustee will be
responsible for withholding taxes on interest
paid as required by applicable law, but shall
be relieved from any such responsibility if it
acts in good faith and in reliance upon an
opinion of counsel.
Certificated Notes presented to the Trustee on
the Maturity Date for payment will be canceled
and held by the Trustee.
Settlement Procedures:
Settlement Procedures with regard to each
Certificated Note purchased through any Agent,
as agent, shall be as follows:
A. The Presenting Agent will advise the
Company by telephone of the following
settlement information with regard to each
Certificated Note:
1. Exact name in which the Certificated
Note(s) is to be registered (the "Registered
Owner").
2. Exact address or addresses of the
Registered Owner for delivery, notices and
payments of principal, premium, if any, and
interest.
3. Taxpayer identification number of the
Registered Owner.
4. Principal amount.
5. Terms:
a) interest rate
b) interest payment dates
6. Price to public.
7. Trade date.
8. Settlement date (Original Issue Date).
9. Stated Maturity Date.
10. Net proceeds to the Company.
11. Presenting Agent's discount or
commission.
12. Purchase Price.
13. Redemption provisions, if any.
14. Repayment provisions, if any.
15. Whether such Note is being sold to the
Presenting Agent as principal or to an
investor or other purchaser through the
Presenting Agent acting as agent for the
Company.
16. Such other information specified with
respect to such Note. |
B. The Company shall provide to the Trustee
the above settlement information received from
the Presenting Agent and shall cause the
Trustee to issue, authenticate and deliver
Certificated Notes. The Company also shall
provide to the Trustee and/or Presenting Agent
a copy of the applicable Pricing Supplement.
C. The Board of Directors of the Company or
its Executive Committee or the designee
thereof shall approve the final terms of the
Certificated Notes.
D. With respect to each trade, the Trustee
will deliver the Certificated Notes to the
Presenting Agent at the following applicable
address: Salomon Brothers Inc, Seven World
Trade Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx
00000, Attention: Legal Department -- Xxxxxxxx
Xxxxxxxx; in the case of X.X. Xxxxxxx & Sons,
Inc., 00 Xxxxx Xxxxxx, 0xx Xxxxx, Xxx Xxxx,
Xxx Xxxx 00000, Attention: Xxxxxx Xxxxx; or
in the case of Xxxxxxx Xxxxx & Co., Xxxxxxx
Lynch, Xxxxxx, Xxxxxx & Xxxxx Incorporated,
Xxxxxxx Xxxxx Money Markets Clearance, 00
Xxxxx Xxxxxx, Xxxxxxxxx Level, N.S.C.C.
Window, New York, New York 10041, Attention:
Xx Xxxxxxxx. The Trustee will keep a copy of
such Certificated Note. The Presenting Agent
will acknowledge receipt of the Certificated
Note through a broker?s receipt and will keep
a copy of such Certificated Note. Delivery of
the Certificated Note will be made only
against such acknowledgment of receipt. Upon
determination that the Certificated Note has
been authorized, delivered and completed as
aforementioned, the Presenting Agent will wire
the net proceeds of the Certificated Note
after deduction of its applicable discount or
commission to the Company pursuant to standard
wire instructions given by the Company.
E. The Presenting Agent will deliver the
Certificated Note (with confirmations), as
well as a copy of the Prospectus and any
applicable Pricing Supplement received from
the Trustee to the purchaser against payment
in immediately available funds.
F. The Trustee will send a copy of such
Certificated Note to the Company.
Settlement Procedures
Timetable:
For offers accepted by the Company, Settlement
Procedures "A" through "F" set forth above
shall be completed on or before the respective
times set forth below:
Settlement
Procedure Time
A-B 3:00 P.M. on the trade date
C No later than the Business Day before day
of settlement
D 2:15 P.M. on day of settlement
E 3:00 P.M. on day of settlement
F 5:00 P.M. on day of settlement
Failure to Settle:
In the event that a purchaser of a
Certificated Note from the Company shall
either fail to accept delivery of or make
payment for a Certificated Note on the date
fixed for settlement, the Presenting Agent
will forthwith notify the Trustee and the
Company by telephone, confirmed in writing,
and return the Certificated Note to the
Trustee. The Trustee, upon receipt of the
Certificated Note from the Agent, will
immediately advise the Company and the Company
will promptly arrange to credit the account of
the Presenting Agent in an amount of
immediately available funds equal to the
amount previously paid by such Presenting
Agent in settlement for the Certificated Note.
Such credits will be made on the settlement
date if possible, and in any event not later
than the Business Day following the settlement
date; provided that the Company has received
notice on the same day. If such failure shall
have occurred for any reason other than
failure by such Presenting Agent to perform
its obligations hereunder or under the
Distribution Agreement, the Company will
reimburse such Presenting Agent on an
equitable basis for its loss of the use of
funds during the period when the funds were
credited to the account of the Company.
Immediately upon receipt of the Certificated
Note in respect of which the failure occurred,
the Trustee will cancel and destroy the Note,
make appropriate entries in its records to
reflect the fact that the Certificated Note
was never issued, and accordingly notify in
writing the Company.
[END OF EXHIBIT 1 TO FORM S-3]
