EXHIBIT 1
Central Xxxxxx Gas & Electric Corporation
$140,000,000
Medium-Term Notes, Series F
FORM OF DISTRIBUTION AGREEMENT
____________, 200_
New York, New York
[Name of Agent]
[Name of Agent]
[Name of Agent]
Dear Sirs:
Central Xxxxxx Gas & Electric Corporation, a New York corporation (the
"Company"), confirms its agreement with each of you with respect to the issue
and sale by the Company of up to $140,000,000 aggregate principal amount of its
Medium-Term Notes, Series F (the "Notes").
The Company proposes to issue the Notes under its Indenture (the
"Indenture") dated as of April 1, 1992 to U.S. Bank Trust National Association
(formerly known as First Trust of New York, National Association) ("U.S. Bank
Trust") as successor to Xxxxxx Guaranty Trust Company of New York, as trustee
(the "Trustee").
The Notes will be issued in minimum denominations of $1,000 and integral
multiples thereof (unless otherwise specified by the Company), will be issued
only in fully registered form and will have the annual interest rates,
maturities and, if appropriate, other terms set forth in a supplement or
supplements to the Prospectus referred to below. The Notes will be issued, and
the terms thereof established, in accordance with the Indenture and, in the case
of Notes sold pursuant to Section 2(a), the Administrative Procedures attached
hereto as Exhibit A (the "Procedures"). The Procedures may only be amended by
written agreement of the Company and you after notice to, and with the approval
of, the Trustee. For the purposes of this Agreement, the term "Agent" shall
refer to any of you, the term "Purchaser" shall refer to any of you acting
solely as principal for resale to investors pursuant to Section 2(b) and not as
agent, and the term
"you" shall refer to you together at any time any of you is acting in both such
capacities or in either such capacity; provided that any additional person
appointed as an Agent pursuant to Section 2(a) shall be included in the terms
"Agent" and "you".
1. Representations and Warranties.The Company represents and warrants to,
and agrees with, you as set forth below in this Section 1. Certain terms used in
this Section 1 are defined in paragraph (c) hereof.
(a) The Company meets the requirements for use of Form S-3 under the
Securities Act of 1933, as amended (the "Act"). The Company filed with the
Securities and Exchange Commission (the "Commission") a registration statement
on such Form (File No. 333-________), including a form of preliminary prospectus
which became effective, for the registration under the Act and the offering
thereof from time to time pursuant to Rule 415 of, among other things, up to
$140,000,000 aggregate principal amount of debt securities. The Company has
filed or will file with the Commission pursuant to the applicable paragraph of
Rule 424 under the Act, any supplement or supplements to the form of prospectus
included in such registration statement relating to the Notes and the plan of
distribution thereof (such supplement being hereinafter called a "Prospectus
Supplement"). Such registration statement, as amended at the date of this
Agreement, meets the requirements set forth in Rule 415(a)(1)(ix) or (x) under
the Act and complies in all other material respects with said Rule. In
connection with the sale of Notes, the Company proposes to file with the
Commission pursuant to the applicable paragraph of Rule 424 under the Act one or
more further supplements to the Prospectus Supplement providing for the
specification of or a change in the interest rates, if any, maturity dates,
issuance prices, redemption terms and prices, if any, and, if appropriate, other
terms of the Notes sold pursuant hereto or the offering thereof (any such
supplement being hereinafter called a "Pricing Supplement").
(b) At each of the following times: (i) as of the Execution Time,
(ii) on the Effective Date, (iii) when any supplement to the Prospectus is filed
with the Commission, (iv) as of the date of any Terms Agreement (as defined by
Section 2(b)) and (v) at the date of delivery by the Company of any Notes sold
hereunder (each such delivery date, a "Closing Date"), (1) the Registration
Statement, as amended as of any such time, and the Prospectus, as supplemented
as of any such time, the Indenture, as amended or supplemented as of any such
time, complied or will comply in all material respects with the applicable
requirements of the Act, the Trust Indenture Act of 1939, as amended (the "Trust
Indenture Act"), and the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), and the respective rules thereunder; (2) the Registration
Statement, as amended as of any such time, did not or will not contain an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary in order to make the statements therein not
misleading; and (3) the Prospectus, as supplemented as of any such time, will
not include 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 Company makes no representations or warranties as to (A) that part of
the Registration Statement which shall constitute the Statements of Eligibility
and Qualification (Form T-1) under the Trust Indenture Act of the Trustee or (B)
the information contained in or omitted from the Registration Statement or the
Prospectus (or any supplement thereto) in reliance upon and in conformity with
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information furnished in writing to the Company by any of you specifically for
use in connection with the preparation of the Registration Statement or the
Prospectus (or any supplement thereto).
(c) The terms which follow, when used in this Agreement, shall have
the meanings indicated. The term "Effective Date" shall mean the later of (i)
the date that the Registration Statement or the most recent post-effective
amendment thereto, if any, was declared effective by the Commission or (ii) the
time and date of the filing of the Company's most recent Annual Report on Form
10-K. "Execution Time" shall mean the date and time that this Agreement is
executed and delivered by the parties hereto. "Basic Prospectus" shall mean the
form of basic prospectus relating to the debt securities contained in the
Registration Statement at the Effective Date (unless such basic prospectus has
been amended by the Company subsequent to the Effective Date, in which case
"Basic Prospectus" shall mean the form of preliminary prospectus as so amended).
"Prospectus" shall mean the Basic Prospectus as supplemented by the Prospectus
Supplement and as it may be further amended or supplemented at the particular
time referred to. "Registration Statement" shall mean the registration
statements referred to in paragraph (a) above, including incorporated documents,
exhibits and financial statements, as they may be amended at the particular time
referred to. "Rule 415" and "Rule 424" refer to such rules under the Act. Any
reference herein to the Registration Statement, the Basic Prospectus, the
Prospectus Supplement or the Prospectus shall be deemed to refer to and include
the documents incorporated by reference therein pursuant to Item 12 of Form S-3
which were filed under the Exchange Act on or before the Effective Date of the
Registration Statement or the issue date of the Basic Prospectus, the Prospectus
Supplement or the Prospectus, as the case may be; and any reference herein to
the terms "amend", "amended", "amendment" or "supplement" with respect to the
Registration Statement, the Basic Prospectus, any Prospectus Supplement or the
Prospectus shall be deemed to refer to and include the filing of any document
under the Exchange Act after the Effective Date of the Registration Statement or
the issue date of the Basic Prospectus, any Prospectus Supplement or the
Prospectus, as the case may be, deemed to be incorporated therein by reference.
(d) Neither the Company nor its Subsidiary (as hereinafter defined)
has sustained since the date of the latest audited financial statements included
or incorporated by reference in the Registration Statement and the Prospectus,
any loss or interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor dispute or
court or governmental action, order or decree, which has had or is reasonably
likely to have a material adverse effect on the financial position,
stockholders' equity or results of operations of the Company and its Subsidiary
taken as a whole, otherwise than as set forth or contemplated in the
Registration Statement and the Prospectus; and, since the respective dates as of
which information is given in the Registration Statement and the Prospectus,
there has not been any change in the capital stock (other than pursuant to any
stock purchase, dividend reinvestment, savings, bonus, incentive, or similar
plan, conversions of convertible securities into common stock or shares of
capital stock issued or to be issued by the Subsidiary pursuant to one or more
subscription agreements in effect between the Subsidiary and the Company at the
date hereof) or long-term debt, normal amortization of debt premium and
discount, bank or finance company borrowings and repayments in the ordinary
course, or additional issuances or repurchases of commercial paper) of the
Company or its Subsidiary or any material adverse change, or any development
involving a prospective material adverse change, in or affecting the general
affairs, management, financial position, stockholders' equity or results of
operations of
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the Company and its Subsidiary taken as a whole, otherwise than as set forth or
contemplated in the Registration Statement and the Prospectus.
(e) Each of Phoenix Development Company, Inc. (the "Subsidiary") and
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, with
power and authority (corporate and other) to own its properties and conduct its
business as described in the Prospectus and is duly qualified to do business in
each jurisdiction in which it owns or leases real property or in which the
conduct of its business requires such qualification except where the failure to
be so qualified, considering all such cases in the aggregate, does not involve a
material risk to the business, properties, financial position or results of
operations of the Company and its Subsidiary taken as a whole; and all of the
outstanding shares of capital stock of the Subsidiary have been duly authorized
and validly issued, are fully paid and nonassessable and are owned beneficially
by the Company subject to no security interest, other encumbrance or adverse
claim. Notwithstanding the foregoing, if the Subsidiary as of the date hereof or
any subsequent date should hereafter or thereafter cease to be a subsidiary
(within the meaning of Rule 405 promulgated by the Commission under the Act) of
the Company, such corporation shall be deemed to be excluded from the definition
of such term from and after such date.
(f) The issuance and sale of the Notes have been duly and validly
authorized by the Company and, when issued within the limitations set forth in
the order or orders of the Public Service Commission of the State of New York
referred to in subsection (g) below and executed and authenticated in accordance
with the provisions of the Indenture and delivered and paid for by the
purchasers thereof, the Notes will constitute valid and legally binding
obligations of the Company entitled to the benefits provided by the Indenture
equally and ratably with the securities outstanding thereunder; the Indenture
has been duly authorized, executed and delivered by the Company and constitutes
a valid and legally binding instrument, enforceable in accordance with its
terms, subject, as to enforcement, to bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium and other similar laws relating to or
affecting the enforcement of creditors' rights generally, to general equitable
principles (regardless of whether such enforceability is considered in a
proceeding in equity or at law) and to an implied covenant of good faith and
fair dealing; and the Notes and the Indenture conform to the descriptions
thereof in the Registration Statement and the Prospectus.
(g) The issue and sale of the Notes and the compliance by the
Company with all of the provisions of the Notes, the Indenture, this Agreement
and any Terms Agreement, and the consummation of the transactions herein and
therein contemplated will not conflict with or result in a breach of any of the
terms or provisions of, or constitute a default under, any indenture, mortgage,
deed of trust, loan agreement or other agreement or instrument to which the
Company is a party or by which the Company is bound or to which any of the
property or assets of the Company is subject (except that, for purposes of this
representation and warranty, compliance with any financial covenant requiring an
arithmetic computation (not determinable at the Execution Time) in respect of
any Notes shall be measured at the time of the establishment of the terms of
such Notes), nor will such action result in any violation of the provisions of
the Company's Certificate of Incorporation, as amended, or the Bylaws of the
Company or any statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the Company or any of its
property or assets; and no consent, approval,
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authorization, order, registration or qualification of or with any such court or
governmental agency or body is required for the issue and sale of the Notes or
the consummation by the Company of the other transactions contemplated by this
Agreement or any Terms Agreement or the Indenture except such as have been
obtained prior to the Execution Time under the Act and the Trust Indenture Act
and such consents, approvals, authorizations, registrations or qualifications as
may be required under state securities or Blue Sky laws in connection with the
public offering of the Notes, and except for filings with and the orders from
the Public Service Commission of the State of New York authorizing the issuance
and sale by the Company of the Notes subject to certain conditions set forth
therein, which orders have been obtained and are in full effect.
(h) Other than as set forth or contemplated in the Prospectus, there
are no legal or governmental proceedings pending to which the Company or its
Subsidiary is a party or of which any property of the Company or its Subsidiary
is the subject which, if determined adversely to the Company or its Subsidiary,
would individually or in the aggregate have a material adverse effect on the
financial position, stockholders' equity or results of operations of the Company
and its Subsidiary taken as a whole; and, to the best of the Company's
knowledge, no such proceedings are threatened or contemplated by governmental
authorities or threatened by others.
(i) There are no contracts or documents of the Company or its
Subsidiary that are required to be described in the Registration Statement or
the Prospectus or to be filed as exhibits to the Registration Statement by the
Act or by the rules and regulations thereunder that have not been so described
or filed.
2. Appointment of Agents; Solicitation by the Agents of Offers to
Purchase; Sales of Notes to a Purchaser.(a) Subject to the terms and conditions
set forth herein, the Company hereby authorizes each of the Agents to act as its
agent to solicit offers for the purchase of all or part of the Notes from the
Company. On the basis of the representations and warranties, and subject to the
terms and conditions set forth herein, each of the Agents agrees, as agent of
the Company, to use its reasonable best efforts to solicit offers to purchase
the Notes from the Company upon the terms and conditions set forth in the
Prospectus (and any supplement thereto) and in the Procedures.
The Company reserves the right, in its sole discretion, to reject
any offer to purchase Notes, in whole or in part. In addition, the Company
reserves the right, in its sole discretion, to instruct the Agents to suspend at
any time, for any period of time or permanently, the solicitation of offers to
purchase the Notes. Upon receipt of instructions from the Company, the Agents
will forthwith suspend solicitations of offers to purchase Notes from the
Company until such time as the Company has advised them that such solicitation
may be resumed.
The Company agrees to pay each Agent a commission on the Closing Date with
respect to each sale of Notes by the Company as a result of a solicitation made
by such Agent pursuant to this subsection, in an amount equal to that percentage
specified in Schedule I hereto of the aggregate principal amount of the Notes
sold by the Company or in such other amount as may be agreed to in writing
between the Company and an Agent; provided that such amount shall not
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exceed the amounts set forth on Schedule I hereto. Such commission shall be
payable as specified in the Procedures.
Subject to the provisions of this Section 2 and to the Procedures, offers
for the purchase of Notes may be solicited by an Agent as agent for the Company
at such times and in such amounts as such Agent deems advisable. The Company
may, upon five (5) days' prior written notice to the Agents, appoint additional
persons to serve as Agents hereunder, but only if each such additional person
agrees to be bound by all the terms of this Agreement as an Agent. The Company
reserves the right to sell, and may solicit and accept offers to purchase, Notes
directly on its own behalf, and, in case of any such sale not resulting from a
solicitation made by any Agent, no commission shall be payable by the Company
with respect to such sale. To the extent a potential investor contacts the
Company directly with an offer or inquiry to purchase Notes, the Company, in
lieu of accepting such offer to purchase and selling Notes directly on its own
behalf, may refer such potential investor to any Agent to complete such sale
(each a "Reverse Offer"). Any commission payable to such Agent on the Closing
Date with respect to a Reverse Offer shall be in an amount as may be agreed to
by the Company and such Agent at such time. The Company agrees, so long as any
Agent is serving in such capacity hereunder, that it will not contact or solicit
potential investors introduced to it by such Agent to purchase Notes.
(b) Subject to the terms and conditions stated herein, whenever the
Company and any of you determine that the Company shall sell Notes directly to
any of you as Purchaser, each such sale of Notes shall be made in accordance
with the terms of this Agreement and, unless otherwise agreed by the Company and
the Purchaser, any supplemental agreement relating thereto between the Company
and the Purchaser. Each such supplemental agreement (which shall be
substantially in the form of Exhibit B hereto) is herein referred to as a "Terms
Agreement." The Purchaser's commitment to purchase Notes pursuant to any Terms
Agreement 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 describe the Notes
to be purchased by the Purchaser pursuant thereto, specify the principal amount
of such Notes, the price to be paid to the Company for such Notes, the rate at
which interest will be paid on the Notes, the Closing Date for such Notes, the
place of delivery of the Notes and payment therefor, the method of payment and
any modification of the requirements for the delivery of the opinions of
counsel, the certificates from the Company or its officers, and the letter from
the Company's independent public accounting firm, pursuant to Section 6(b). Such
Terms Agreement shall also specify the period of time referred to in Section
4(m). Except as set forth in any Terms Agreement, no commission shall be payable
by the Company with respect to any sale of Notes pursuant to a Terms Agreement.
Delivery of the Notes sold to the Purchaser pursuant to any Terms
Agreement shall be made as agreed to between the Company and the Purchaser as
set forth in the respective Terms Agreement, not later than the Closing Date set
forth in such Terms Agreement, against payment of funds to the Company in the
net amount due to the Company for such Notes by the method and in the form set
forth in the respective Terms Agreement.
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3. Offering and Sale of Notes.
Each Agent and the Company agree to perform the respective duties and
obligations specifically provided to be performed by them in the Procedures.
4. Agreements. The Company agrees with you that:
(a) Prior to the termination of the offering of the Notes, the
Company will not file any amendment of the Registration Statement or supplement
to the Prospectus (except for (i) periodic or current reports filed under the
Exchange Act, (ii) a Pricing Supplement or (iii) a supplement relating to an
offering of debt securities other than the Notes) unless the Company has
furnished each of you a copy for your review prior to filing and given each of
you a reasonable opportunity to comment on any such proposed amendment or
supplement. Subject to the foregoing sentence, the Company will cause each
supplement to the Prospectus to be filed with the Commission pursuant to the
applicable paragraph of Rule 424 within the time period prescribed. The Company
will promptly advise each of you (i) when the Prospectus, and any supplement
thereto, shall have been filed with the Commission pursuant to Rule 424, (ii)
when, prior to the termination of the offering of the Notes, any amendment of
the Registration Statement shall have been filed or become effective, (iii) of
any request by the Commission for any amendment of the Registration Statement or
supplement to the Prospectus or for any additional information, (iv) of the
issuance by the Commission of any stop order suspending the effectiveness of the
Registration Statement or the institution or threatening of any proceeding for
that purpose and (v) of the receipt by the Company of any notification with
respect to the suspension of the qualification of the Notes for sale in any
jurisdiction or the initiation or threatening of any proceeding for such
purpose. The Company will use its reasonable best efforts to prevent the
issuance of any such stop order and, if issued, to obtain as soon as reasonably
possible the withdrawal thereof.
(b) If, at any time when a prospectus relating to the Notes is
required to be delivered under the Act, any event occurs as a result of which
the Prospectus as then supplemented would include an untrue statement of a
material fact or omit to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, or if it shall be necessary to amend the Registration Statement or
to supplement the Prospectus to comply with the Act or the Exchange Act or the
respective rules thereunder, the Company promptly will (i) notify each of you to
suspend solicitation of offers to purchase Notes (and, if so notified by the
Company, each of you shall forthwith suspend such solicitation and cease using
the Prospectus as then supplemented), (ii) prepare and file with the Commission,
subject to the first sentence of paragraph (a) of this Section 4, an amendment
or supplement which will correct such statement or omission or effect such
compliance and (iii) supply any supplemented Prospectus to each of you in such
quantities as you may reasonably request; provided, however, that should any
such event relate solely to activities of you, then you shall assume the expense
of preparing and furnishing any such amendment or supplement. If such amendment
or supplement, and any documents, certificates and opinions furnished to each of
you pursuant to paragraphs (g), (j), (k) and (l) of this Section 4 in connection
with the preparation of filing of such amendment or supplement are satisfactory
in all respects to you, you will, upon the filing of such amendment or
supplement with the Commission and upon the
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effectiveness of an amendment to the Registration Statement, if such an
amendment is required, resume your obligation to solicit offers to purchase
Notes hereunder.
(c) During the term of this Agreement, the Company will timely file
all documents required to be filed with the Commission pursuant to Section
13(a), 13(c), 14 or 15(d) of the Exchange Act. In addition, on the date on which
the Company (or as soon as practicable thereafter) makes any announcement to the
general public concerning earnings or concerning any other event which is
required to be described, or which the Company proposes to describe, in a
document filed pursuant to the Exchange Act, the Company will furnish to each of
you the information contained in such announcement. The Company will notify each
of you of any downgrading in the rating of the Notes or any other debt
securities of the Company, or any public announcement of placement of the Notes
or any other debt securities of the Company on what is commonly termed a "watch
list" for possible downgrading, by any "nationally recognized statistical rating
organization" (as defined for purposes of Rule 436(g) under the Act), promptly
after the Company learns of any such downgrading or public announcement.
(d) As soon as practicable, the Company will make generally
available to its security holders and to each of you an earnings statement or
statements of the Company and its Subsidiary which will satisfy the provisions
of Section 11(a) of the Act and Rule 158 under the Act.
(e) The Company will furnish to each of you and your counsel,
without charge (except as otherwise provided herein), a reasonable number of
copies of the Registration Statement (including exhibits thereto) and, so long
as delivery of a prospectus may be required by the Act, as many copies of the
Prospectus and any supplement thereto as you may reasonably request.
(f) The Company will arrange for the qualification of the Notes for
sale under the laws of such jurisdictions as any of you may designate, will
maintain such qualifications in effect so long as required for the distribution
of the Notes, and upon your request will arrange for the determination of the
legality of the Notes for purchase by institutional investors; provided,
however, that the Company shall not be required to qualify as a foreign
corporation or to file a general consent to service of process in any
jurisdiction, to pay filing fees and other expenses in connection therewith in
the aggregate exceeding $4,000, or to comply with any other requirement
reasonably deemed by the Company to be unduly burdensome.
(g) During the term of this Agreement, the Company shall furnish to
each of you (i) copies of all annual, quarterly and other reports furnished to
stockholders, (ii) copies of all annual, quarterly and current reports (without
exhibits but including documents incorporated by reference therein) of the
Company filed with the Commission under the Exchange Act and (iii) such other
information concerning the Company as you may reasonably request from time to
time.
(h) The Company shall, whether or not any sale of the Notes is
consummated, (i) pay all expenses incident to the performance of its obligations
under this Agreement, including the fees and disbursements of its accountants
and counsel, the cost of printing or other production and delivery of the
Registration Statement, the Prospectus, all amendments thereof
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and supplements thereto, the Indenture, this Agreement and all other documents
relating to the offering, the cost of preparing, printing, packaging and
delivering the Notes, the fees and disbursements, including reasonable fees of
counsel, incurred pursuant to Section 4(f), the fees and disbursements of the
Trustee and the fees of any ratings agency that rates the Notes, (ii) reimburse
each of you on a monthly basis for all reasonable out-of-pocket expenses
incurred by you in connection with this Agreement (including, but not limited
to, advertising expenses), in the aggregate not to exceed $2,500 per Agent for
the term of this Agreement, and (iii) pay the reasonable fees and expenses of
your counsel incurred in connection with this Agreement.
(i) Each acceptance by the Company of an offer to purchase Notes
will be deemed to be a new making to you of the representations and warranties
of the Company in Section 1 (except that such representations and warranties
shall be deemed to relate solely to the Registration Statement as then amended
and to the Prospectus as then amended and supplemented to relate to such Notes).
(j) Except as otherwise provided in subsection (n) of this Section
4, each time that the Registration Statement or the Prospectus is amended or
supplemented (other than by (i) an amendment or supplement relating to any
offering of debt securities other than the Notes or (ii) a Pricing Supplement)
the Company will deliver or cause to be delivered promptly to each of you a
certificate of the Company, signed by any of the Chairman of the Board, the
President and Chief Executive Officer, any Vice President having
responsibilities for financial matters or the Controller or the Treasurer of the
Company, dated the date of the effectiveness of such amendment or the date of
the filing of such supplement, in form reasonably satisfactory to you, of the
same tenor as the certificate referred to in Section 5(d) but modified to relate
to the last day of the fiscal quarter for which financial statements of the
Company were last filed with the Commission and to the Registration Statement
and the Prospectus as amended and supplemented to the time of the effectiveness
of such amendment or the filing of such supplement.
(k) Except as otherwise provided in subsection (n) of this Section
4, each time that the Registration Statement or the Prospectus is amended or
supplemented (other than by (i) an amendment or supplement relating to any
offering of debt securities other than the Notes or (ii) a Pricing Supplement),
the Company shall furnish or cause to be furnished promptly to each of you a
written opinion, satisfactory to you, by counsel for the Company, dated the date
of the effectiveness of such amendment or the date of the filing of such
supplement, in form satisfactory to each of you, of the same tenor as the
opinion referred to in Section 5(b), but modified to relate to the Registration
Statement and the Prospectus as amended and supplemented to the time of the
effectiveness of such amendment or the filing of such supplement or, in lieu of
such opinion, such counsel may furnish each of you with a letter to the effect
that you may rely on such counsel's last opinion to the same extent as though it
were dated the date of such letter authorizing reliance (except that statements
in such last opinion will be deemed to relate to the Registration Statement and
the Prospectus as amended and supplemented to the time of the effectiveness of
such amendment or the filing of such supplement).
(l) Except as otherwise provided in subsection (n) of this Section
4, each time that the Registration Statement or the Prospectus is amended or
supplemented (other than by (i) an amendment or supplement relating to any
offering of debt securities other than the Notes or (ii) a Pricing Supplement)
to set forth amended or supplemental financial information (derived
9
from the accounting records of the Company subject to the internal controls of
the Company's accounting system or derived directly from such records by
computation), the Company shall cause its registered independent public
accounting firm promptly to furnish each of you a letter, dated the date of the
effectiveness of such amendment or the date of the filing of such supplement, in
form satisfactory to each of you, of the same tenor as the letter referred to in
Section 5(e) with such changes as may be necessary to reflect the amended and
supplemental financial information included or incorporated by reference in the
Registration Statement and the Prospectus, as amended or supplemented to the
date of such letter.
(m) During the period, if any, specified in any Terms Agreement, the
Company shall not, without the prior consent of the Purchaser thereunder, issue
or announce the proposed issuance of any of its debt securities, including the
Notes, with maturities or other terms substantially similar to the Notes being
purchased pursuant to such Terms Agreement.
(n) The Company shall not be required to comply with the provisions
of subsections (j), (k) and (l) of this Section 4 during any period (which may
occur from time to time during the term of this Agreement) for which the Company
has instructed the Agents to suspend the solicitation of offers to purchase
Notes with respect to any Agent who is not a Purchaser holding Notes during any
such period pursuant to any Terms Agreement. Whenever the Company has instructed
the Agents to suspend the solicitation of offers to purchase Notes for any such
period, however, prior to instructing the Agents to resume the solicitation of
offers to purchase Notes or prior to entering into any Terms Agreement, the
Company shall be required to comply with the provisions of subsections (j), (k)
and (l) of this Section 4, but only to the extent of delivering or causing to be
delivered the most recent certificate, opinion or letter, as the case may be,
which would have otherwise been required under each such subsection unless the
Agents otherwise reasonably request that such documents in respect of prior
periods be delivered.
5. Conditions to the Obligations of the Agents. The obligations of each
Agent to solicit offers to purchase the Notes shall be subject to (i) the
accuracy of the representations and warranties on the part of the Company
contained herein as of the Execution Time, on the Effective Date and when any
supplement to the Prospectus is filed with the Commission, (ii) the accuracy of
the statements of the Company made in any certificates pursuant to the
provisions hereof, (iii) the performance by the Company of its obligations
hereunder and (iv) the following additional conditions:
(a) If filing of the Prospectus, or any supplement thereto, is
required pursuant to Rule 424, the Prospectus, and any such supplement, shall
have been filed in the manner and within the time period required by Rule 424;
and no stop order suspending the effectiveness of the Registration Statement
shall have been issued and no proceedings for that purpose shall have been
instituted or threatened.
(b) The Company shall have furnished to each Agent the opinion of
counsel for the Company, dated the Execution Time, 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
jurisdiction of its incorporation, with
10
power and authority (corporate and governmental) to own its properties and
conduct its business as described in the Prospectus, as amended or
supplemented, and is duly qualified to do business in each jurisdiction in
which it owns or leases real property or in which the conduct of its
business requires such qualification except where the failure to be so
qualified, considering all such cases in the aggregate, does not involve a
material risk to the business, properties, financial position or results
of operations of the Company; provided, however, that at such time, if
ever, the Subsidiary constitutes 10% or more of the consolidated assets of
the Company or contributes 10% or more of the consolidated net income of
the Company for the then most recent 12-month period, the Agents may
request that counsel for the Company include in any written opinion to
them required by this Section 5(b) or Section 4(k), an opinion to the
effect that the Subsidiary has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, with power and authority (corporate and
governmental) to own its properties and conduct its business as described
in the Prospectus, as amended or supplemented, and is duly qualified to do
business in each jurisdiction in which it owns or leases real property or
in which the conduct of its business requires such qualification except
where the failure to be so qualified, considering all such cases in the
aggregate, does not involve a material risk to the business, properties,
financial position or results of operations of the Company and the
Subsidiary taken as a whole; and all of the outstanding shares of capital
stock of the Subsidiary have been duly authorized and validly issued, are
fully paid and nonassessable and are owned beneficially by the Company
subject to no security interest, other encumbrance, or adverse claim.
(ii) To the best of such counsel's knowledge and other than as
set forth or contemplated in the Prospectus, there are no legal or
governmental proceedings pending to which the Company is a party or of
which any property of the Company is the subject which, if determined
adversely to the Company, would individually or in the aggregate have a
material adverse effect on the consolidated financial position,
stockholders' equity or results of operations of the Company and its
Subsidiary, taken as a whole; and, to the best of such counsel's
knowledge, no such proceedings are threatened or contemplated by
governmental authorities or threatened by others.
(iii) This Agreement has been duly authorized, executed and
delivered by the Company.
(iv) The Indenture has been duly authorized, executed and
delivered by the Company and constitutes a valid and legally binding
instrument, enforceable in accordance with its terms, subject, as to
enforcement, to bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or affecting
the enforcement of creditors' rights generally, to general equitable
principles (regardless of whether such enforceability is considered in a
proceeding in equity or at law) and to an implied covenant of good faith
and fair dealing; and the Indenture has been duly qualified under the
Trust Indenture Act.
(v) The issuance and sale of the Notes have been duly and
validly authorized by the Company and, when issued within the limitations
set forth in the
11
applicable order or orders from the Public Service Commission of the State
of New York referred to in paragraph (x) below and executed and
authenticated in accordance with the provisions of the Indenture and
delivered to and paid for by the purchasers thereof in accordance with
this Agreement, the Notes will constitute valid and legally binding
obligations of the Company enforceable in accordance with their terms,
subject, as to enforcement, to bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium and other similar laws relating to
or affecting the enforcement of creditors' rights generally, to general
equitable principles (regardless of whether such enforceability is
considered in a proceeding in equity or at law) and to an implied covenant
of good faith and fair dealing, and will be entitled to the benefit
provided by the Indenture equally and ratably with the securities
outstanding thereunder (except insofar as a sinking fund established in
accordance with the provisions of the Indenture may afford additional
benefit for the securities of any particular series); and the Notes and
the Indenture conform as to legal matters to the descriptions thereof
contained in the Registration Statement and the Prospectus.
(vi) The issue and sale of the Notes and the compliance by the
Company with all of the provisions of the Notes, the Indenture and this
Agreement and the consummation of the transactions therein and herein
contemplated (except as to compliance with any financial covenant
requiring an arithmetic computation not determinable at the Execution Time
as to which such counsel need express no opinion) will not conflict with
or result in a breach of any of the terms or provisions of, or constitute
a default under, any indenture, mortgage, deed of trust, loan agreement or
material other agreement or instrument known, as of the date of such
opinion, to such counsel to which the Company is a party or by which the
Company is bound or to which any of the property or assets of the Company
is subject, nor will such action result in any violation of the provisions
of the Company's Certificate of Incorporation, as amended, or the Bylaws
of the Company or any statute or any order, rule or regulation known, as
of the date of such opinion, to such counsel of any court or governmental
agency or body having jurisdiction over the Company or any of its
properties.
(vii) No consent, approval, authorization, order, registration
or qualification of or with any court or governmental agency or body
having jurisdiction over the Company or any of its properties is required
for the issue and sale of the Notes or the consummation by the Company of
the other transactions contemplated by this Agreement or the Indenture,
except such as have been obtained under the Act and the Trust Indenture
Act and such consents, approvals, authorizations, registrations or
qualifications as may be required under state securities or Blue Sky laws
in connection with the public offering of the Notes, and except for
filings with and the order or orders from the Public Service Commission of
the State of New York authorizing the issuance and sale by the Company of
the Notes subject to certain conditions set forth therein, which order or
orders have been obtained and, to the best knowledge of such counsel, are
in full force and effect.
(viii) The Registration Statement, at the Effective Date, and
the Prospectus, as of the date of such opinion (except as to the financial
statements and other financial or statistical data contained or
incorporated by reference therein and except for that part of the
Registration Statement which shall constitute the Statements of
Eligibility and
12
Qualification (Form T-1) under the Trust Indenture Act of the Trustee, as
to which such counsel need express no opinion) comply as to form in all
material respects with all applicable requirements of the Act, and, with
respect to the documents or portions thereof filed with the Commission
pursuant to the Exchange Act and incorporated by reference in the
Prospectus pursuant to Item 12 of Form S-3, the Exchange Act and the
applicable instructions, rules and regulations of the Commission
thereunder; on the basis of information received from the Commission, at
the date of such opinion, the Registration Statement has become effective
under the Act, and, to the best knowledge of such counsel, no proceedings
for a stop order with respect thereto have been instituted or are pending
or threatened under Section 8 of the Act; and based on such counsel's
participation in the preparation of the Registration Statement and
Prospectus and its services as counsel to the Company (but such opinion
may state that such counsel did not independently check or verify the
correctness of the statements made by the Company or factual information
included in the Registration Statement and Prospectus, and thereby may
assume the correctness thereof, except insofar as such statements or
information relate to such counsel or are stated in the Registration
Statement or Prospectus as having been made on their authority as
experts), no facts have come to the attention of such counsel to cause
them to believe, and such counsel have no reason to believe, that the
Registration Statement, at 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 to make the statements therein not
misleading (except as to the financial statements or other financial or
statistical data contained in or incorporated by reference in the
Registration Statement and the Prospectus and except for that part of the
Registration Statement which shall constitute the Statements of
Eligibility and Qualification (Form T-1) under the Trust Indenture Act of
the Trustee), or that the Prospectus, as of the date of such opinion,
includes an 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
(except as to the financial statements or other financial or statistical
data contained in or incorporated by reference in the Registration
Statement and the Prospectus).
(ix) The Company's gas distribution activities are exempt from
the Natural Gas Act.
(x) The Public Service Commission of the State of New York has
issued an appropriate order or orders with respect to the issuance and
sale of the Notes in accordance with this Agreement; to the best knowledge
of such counsel, such order or orders are still in full force and effect;
the issuance and sale of the Notes in accordance with this Agreement and
subject to the limitations set forth in such orders will conform with the
terms of such order or orders.
As to factual matters (including relating to the Company's financial
condition) included in said opinion, such counsel may rely upon certificates of
public officials as of a recent date, the warranties and representations of the
Company set forth in this Agreement, and certificates of the Company made
pursuant to the provisions of this Agreement.
13
(c) Each Agent shall have received from counsel for the Agents an
opinion, dated the Execution Time, with respect to the issuance and sale of the
Notes, the Indenture, the Registration Statement, the Prospectus (together with
any supplement thereto) and other related matters as the Agents may reasonably
require, and the Company shall have furnished to such counsel such documents as
they reasonably request for the purpose of enabling them to pass upon such
matters.
(d) The Company shall have furnished to each Agent a certificate of
the Company, signed by any of the Chairman of the Board, the President, the
Chief Financial Officer or any Vice President having responsibilities for
financial matters, the Controller or the Treasurer of the Company, dated the
Execution Time, to the effect that the signer of such certificate has carefully
examined the Registration Statement, the Prospectus, any supplement to the
Prospectus and this Agreement and that:
(i) The representations and warranties of the Company in
this Agreement are true and correct in all material respects and the
Company has complied with all the agreements and satisfied all the
conditions on its part to be performed or satisfied as a condition to the
obligation of the Agents to solicit offers to purchase the Notes.
(ii) No stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that purpose
have been instituted or, to the Company's knowledge, threatened.
(iii) (A) Neither the Company nor its Subsidiary has
sustained since the date of the latest audited financial statements
included or incorporated by reference in the Registration Statement and
the Prospectus, any loss or interference with its business from fire,
explosion, flood or other calamity, whether or not covered by insurance,
or from any labor dispute or court or governmental action, order or
decree, which has had or is reasonably likely to have a material adverse
effect on the financial position, stockholders' equity or results of
operations of the Company and its Subsidiary taken as a whole, otherwise
than as set forth or contemplated in the Registration Statement and the
Prospectus and (B) since the respective dates as of which information is
given in the Registration Statement and the Prospectus, there has not been
any change in the capital stock (other than pursuant to any stock
purchase, dividend reinvestment, savings, bonus, incentive, or similar
plan, conversions of convertible securities into common stock, or shares
of capital stock issued or to be issued by the Subsidiary pursuant to one
or more subscription agreements in effect between the Subsidiary and the
Company at the date hereof), or long-term debt (normal amortization of
debt premium and discount, bank or finance company borrowings and
repayments in the ordinary course, or additional issuances or repurchases
of commercial paper) of the Company or its Subsidiary or any material
adverse change, or any development involving a prospective material
adverse change, in or affecting the general affairs, management, financial
position, stockholders' equity or results of operations of the Company and
its Subsidiary taken as a whole, otherwise than as set forth or
contemplated in the Registration Statement and the Prospectus.
14
(e) At the Execution Time, the Company's independent registered
public accounting firm shall have furnished to each Agent a letter, dated as of
the Execution Time, in form and substance satisfactory to the Agents, stating in
effect that:
(i) They are an independent registered public accounting
firm with respect to the Company within the meaning of the Act and the
applicable rules and regulations thereunder adopted by the Commission and
the Public Company Accounting Oversight Board (United States) ("PCAOB").
(ii) In their opinion, the consolidated financial
statements of the Company and its subsidiaries audited by them and
included in the Company's Annual Report on Form 10-K for the year ended
December 31, 2005, which are incorporated by reference in the Registration
Statement and the Prospectus comply as to form in all material respects
with the applicable accounting requirements of the Act and the Exchange
Act and the related rules and regulations adopted by the Commission.
(iii) On the basis of procedures (but not an audit in
accordance with the standards of the PCAOB) consisting of:
(A) reading the minutes of meetings of the
stockholders and the Board of Directors of the Company and its
consolidated subsidiaries since December 31, 2005, as set forth in
the minute books through a specified date not more than five
business days prior to the date of delivery of such letter;
(B) performing the procedures specified by the
PCAOB for a review of interim financial information as described in
SAS 100, Interim Financial Information, on the unaudited condensed
interim financial statements of the Company and its consolidated
subsidiaries incorporated by reference in the Registration Statement
and the Prospectus (the "Unaudited Statements") and reading the
unaudited interim financial data for the period from the date of the
latest balance sheet included in the Unaudited Statements to the
date of the latest available interim financial data; and
(C) making inquiries of certain officials of the
Company who have responsibility for financial and accounting matters
regarding the specific items for which representations are requested
in Sections 5(e)(iii)(1) through 5(e)(4) below,
nothing has come to their attention as a result of the foregoing
procedures that caused them to believe that:
(1) the Unaudited Statements incorporated by
reference in the Registration Statement and the Prospectus do not
comply in form in all material respects with the applicable
accounting requirements of the Act and the Exchange Act and with the
related rules and regulations adopted by the Commission;
(2) any material modifications should be made to
the Unaudited Statements incorporated by reference in the
Registration Statement and
15
Prospectus for them to be in conformity with generally accepted
accounting principles; and
(3) (i) at the date of the latest available
interim financial data and at a specified date not more than five
business days prior to the date of delivery of such letter, there
was any change in the capital stock or increase in long-term debt or
any decreases in consolidated net current assets (working capital)
or stockholders' equity of the Company and subsidiaries consolidated
as compared with amounts shown in the latest balance sheet
incorporated by reference in the Registration Statement and the
Prospectus, or (ii) for the period from the date of the latest
income statement incorporated by reference in the Registration
Statement and the Prospectus to the date of the latest available
financial data and for the period from the date of the latest income
statement incorporated by reference in the Registration Statement
and the Prospectus to a specified date not more than five business
days prior to delivery of such letter, there were any decreases, as
compared with the corresponding period in the preceding year, in
consolidated net sales or in the total or per-share amounts of net
income, except in all instances for changes, increases or decreases
which the Registration Statement and the Prospectus disclose have
occurred or may occur, or they shall state any specific changes,
increases or decreases.
(iv) They have read the dollar amounts (or percentages
derived from such dollar amounts) and other financial information
specified by the Agents (A) which appear in the Prospectus under the
caption "Ratios of Earnings to Fixed Charges", (B) which appear or are
incorporated by reference in the Company's Annual Report on Form 10-K
incorporated by reference in the Registration Statement and the Prospectus
under the captions "Management's Discussion and Analysis of Financial
Condition and Results of Operations" and "Ratio of Earnings to Fixed
Charges" and in the table captioned "Five Year Summary of Consolidated
Operations and Selected Financial Information", or (C) which appear in any
of the Company's Quarterly Reports on Form 10-Q incorporated by reference
in the Registration Statement and the Prospectus under the captions
"Management's Discussion and Analysis of Financial Condition and Results
of Operations" and "Ratio of Earnings to Fixed Charges" and agreed such
dollar amounts, percentages and other financial information respectively
to appropriate accounts in the Company's accounting records subject to
controls over financial reporting and to schedules prepared by the Company
therefor.
References to the Prospectus in this paragraph (e) include any supplement
thereto at the date of the letter.
(f) Each Agent shall have received copies of the Letter of
Representations between the Company, U.S. Bank Trust and The Depositary Trust
Company ("DTC"), satisfactory to each of you, summarizing DTC's agreement to
hold, safekeep and effect book-entry transfers of the Notes.
16
(g) Prior to the Execution Time, the Company shall have furnished to
each Agent such further information, documents, certificates and opinions of
counsel as the Agents may reasonably request.
If any of the conditions specified in this Section 5 shall not have been
fulfilled in all material respects when and as provided in this Agreement, or if
any of the opinions and certificates mentioned above or elsewhere in this
Agreement shall not be in all material respects reasonably satisfactory in form
and substance to such Agents and counsel for the Agents, this Agreement and all
obligations of any Agent hereunder may be canceled at any time by the Agents.
Notice of such cancellation shall be given to the Company in writing or by
telephone or telegraph confirmed in writing.
The documents required to be delivered by this Section 5 at the Execution
Time shall be delivered at the office designated by the Company in New York, New
York.
6. Conditions to the Obligations of the Purchaser. The obligations of the
Purchaser to purchase any Notes will be subject to the accuracy of the
representations and warranties on the part of the Company herein as of the date
of any related Terms Agreement and as of the Closing Date for such Notes, to the
performance and observance by the Company of all covenants and agreements herein
contained on its part to be performed and observed and to the following
additional conditions precedent:
(a) No stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceedings for that purpose shall have
been instituted or threatened.
(b) If specified by any related Terms Agreement and except to the
extent modified by such Terms Agreement, the Purchaser shall have received,
appropriately updated, (i) a certificate of the Company, dated as of the Closing
Date, to the effect set forth in Section 5(d), (ii) the opinion of counsel for
the Company, dated as of the Closing Date, substantially to the effect set forth
in Section 5(b), (iii) the opinion of counsel for the Purchaser, dated as of the
Closing Date, substantially to the effect set forth in Section 5(c) and (iv) the
letter of the Company's independent registered public accounting firm, dated as
of the Closing Date, substantially to the effect set forth in Section 5(e);
provided, however, that references to the Registration Statement and the
Prospectus in such certificate, opinions and letter shall be to the Registration
Statement and the Prospectus as then amended and supplemented.
(c) Prior to the Closing Date, the Company shall have furnished to
the Purchaser such further information, certificates and documents as the
Purchaser may reasonably request.
If any of the conditions specified in this Section 6 shall not have been
fulfilled in all material respects when and as provided in this Agreement and
any Terms Agreement, or if any of the opinions and certificates mentioned above
or elsewhere in this Agreement or such Terms Agreement shall not be in all
material respects reasonably satisfactory in form and substance to the Purchaser
and its counsel, such Terms Agreement and all obligations of the Purchaser
thereunder and with respect to the Notes subject thereto may be canceled at, or
any time prior to,
17
the respective Closing Date by the Purchaser. Notice of such cancellation shall
be given to the Company in writing or by telephone or telegraph confirmed in
writing.
7. Right of Person Who Agreed to Purchase to Refuse to Purchase. The
Company agrees that any person who has agreed to purchase and pay for any Note,
including a Purchaser and any person who purchases pursuant to a solicitation by
any of the Agents, shall have the right to refuse to purchase such Note if, at
the Closing Date therefor, either (a) any condition set forth in Section 5 or
Section 6, as applicable, shall not be satisfied or (b) subsequent to the
agreement to purchase such Note, there shall have occurred (i) any change in or
affecting the business or properties of the Company and its Subsidiary,
considered as one enterprise, the effect of which, in the reasonable judgment of
such person, has a material adverse effect on the investment quality of such
Note or (ii) any event described in paragraphs (ii), (iii), (iv) or (v) of
Section 9(b).
8. Indemnification and Contribution. (a) The Company will indemnify and
hold harmless each of you against all losses, claims, damages or liabilities,
joint or several, to which you may become subject, under the Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon an untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement, the
Prospectus, any Prospectus Supplement and any other prospectus relating to the
Notes, or any amendment or supplement thereto, or arise out of or are based upon
the omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, and
will reimburse each of you for any legal or other expenses reasonably incurred
by each of you in connection with investigating or defending any such action or
claim; provided, however, that the Company shall not be liable in any such case
to the extent that any such loss, claim, damage or liability arises out of or is
based upon an untrue statement or alleged untrue statement in or omission or
alleged omission from the Registration Statement, the Prospectus, any Prospectus
Supplement and any other prospectus relating to the Notes or any such amendment
or supplement thereto in reliance upon and in conformity with written
information furnished to the Company by any of you expressly for use in any such
documents.
(b) Each of you, severally, will indemnify and hold harmless the
Company against any losses, claims, damages or liabilities to which the Company
may become subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon an untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement, the Prospectus, any Prospectus
Supplement and any other prospectus relating to the Notes, or any amendment or
supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in the Registration
Statement, the Prospectus, any Prospectus Supplement and any other prospectus
relating to the Notes, or any amendment or supplement thereto, in reliance upon
and in conformity with written information furnished to the Company by each of
you, respectively, expressly for use therein; and will reimburse the Company for
any legal or other expenses reasonably incurred by the Company in connection
with investigating or defending any such action or claim.
18
(c) Promptly after receipt by an indemnified party under subsection
(a) or (b) above of notice of the commencement of any action, such indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which it (except and
only to the extent that it has been prejudiced in any material respect by such
failure to notify) may have to any indemnified party otherwise than under such
subsection. In case any such action shall be brought against any indemnified
party and it shall notify the indemnifying party of the commencement thereof,
the indemnifying party shall be entitled to participate therein and, to the
extent that it may wish, jointly with any other indemnifying party similarly
notified, to assume the defense thereof, with counsel satisfactory to such
indemnified party (who 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 thereof, the indemnifying party shall not be liable to such indemnified
party under such subsection for any legal expenses of other counsel or any other
expenses, in each case subsequently incurred by such indemnified party, in
connection with the defense thereof other than reasonable costs of
investigation. Any losses, claims, damages or liabilities for which an
indemnified party is entitled to indemnification or contribution under this
Section 8 shall be paid by the indemnifying party to the indemnified party as
such losses, claims, damages or liabilities are incurred. In no event shall the
indemnifying party be liable for fees and expenses for more than one counsel
separate from their own counsel for all indemnified parties in connection with
any one action or related actions in the same jurisdiction arising out of the
same allegations or circumstances unless any such indemnified party shall have
been advised by such counsel that there may be one or more legal defenses
available to it which are different from or additional to or in conflict with
those available to the other indemnified parties and in the judgment of such
counsel it is advisable for such indemnified party to employ separate counsel.
An indemnifying party will not, without the prior written consent of the
indemnified party, settle or compromise or consent to the entry of any judgment
with respect to any pending or threatened claim, action, suit or proceeding in
respect of which indemnification or contribution may be sought hereunder
(whether or not the indemnified parties are actual or potential parties to such
claim, action, suit or proceeding) unless such settlement, compromise or consent
(i) includes an unconditional release of such indemnified party from all
liability arising out of such claim, action, suit or proceeding and (ii) does
not include a statement as to or an admission of fault, culpability or a failure
to act, by or on behalf of any indemnified party.
(d) If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or
actions in respect thereof) in such proportion as is appropriate to reflect the
relative benefits received by the Company on the one hand and you on the other
from the offering of the Notes, as well as other equitable considerations,
including relative fault in connection with the statements or omissions which
resulted in such losses, claims damages or liabilities. The relative benefits
received by the Company on the one hand and the Agents on the other shall be
deemed to be in the same proportion as the total net proceeds from the offering
of the Notes received by the Company bear to the total discounts and commissions
received by you. The relative fault shall be determined
19
by reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to state a
material fact relates to information supplied by the Company on the one hand or
you on the other and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Company and you agree that it would not be just and equitable if
contribution pursuant to this subsection (d) were determined by pro rata
allocation (even if you were treated as one entity for such purpose) or by any
other method of allocation which does not take account of the equitable
considerations referred to above in this subsection (d). The amount paid or
payable by an indemnified party as a result of the losses, claims, damages or
liabilities (or actions in respect thereof) referred to above in this subsection
(d) shall be deemed to include any legal or other expenses reasonably incurred
by such indemnified party in connection with investigating or defending any such
action or claim. No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation. In connection
with an offering of Notes purchased from the Company by two or more Agents as
principal, the respective obligations of such Agents to contribute pursuant to
this Section 8(d) are several, and not joint, in proportion to the aggregate
principal amount of Notes that each Agent has agreed to purchase from the
Company.
(e) The obligations of the Company under this Section 8 shall be in
addition to any liability which the Company may otherwise have and shall extend,
upon the same terms and conditions, to each person, if any who controls any of
you within the meaning of the Act or the Exchange Act; and the obligations of
you under this Section 8 shall be in addition to any liability which you may
otherwise have and shall extend, upon the same terms and conditions, to each
officer and director of the Company and to each person, if any, who controls the
Company within the meaning of the Act or the Exchange Act.
9. Termination. (a) This Agreement will continue in effect until
terminated as provided in this Section 9. This Agreement may be terminated by
either the Company as to any of you or all of you insofar as this Agreement
relates to such of you, giving written notice of such termination to such of you
or the Company, as the case may be. This Agreement shall so terminate at the
close of business on the first business day following the receipt of such notice
by the party to whom such notice is given. In the event of such termination, no
party shall have any liability to the other party hereto, except as provided in
the third paragraph of Section 2(a), Section 4(d), Section 4(h), Section 8 and
Section 10 and, so long as any Purchaser continues to own Notes, subsections
(a), (b) and (c) of Section 4.
(b) Each Terms Agreement shall be subject to termination in the
absolute discretion of the Purchaser, by notice given to the Company prior to
delivery of any payment for Notes to be purchased thereunder, if prior to such
time (i) the Purchaser shall exercise its right to refuse to purchase the Notes
which are the subject of such Terms Agreement in accordance with the provisions
of Section 7, or (ii) there shall have occurred any outbreak or escalation of
hostilities or other national or international calamity or crisis, the effect of
which shall be such as to make it, in the reasonable judgment of the Purchaser,
impractical to market the Notes or enforce contracts for the sale of the Notes,
or (iii) trading in any securities of the Company shall have been suspended by
the Commission or a national securities exchange, or if trading generally on
either the American Stock Exchange or the New York Stock Exchange shall have
20
been suspended, or minimum or maximum prices for trading shall have been fixed,
or maximum ranges for prices for securities shall have been required, by either
of said exchanges or by order of the Commission 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 statistical rating organization" (as defined for purposes of Rule
436(g) under the Act) to the Notes or any other debt securities of the Company
as of the date of the applicable Terms Agreement shall have been lowered since
that date or if any such rating agency shall have publicly announced that it has
placed the Notes or any other debt securities of the Company on what is commonly
termed a "watch list" for possible downgrading, or (v) the subject matter of any
amendment or supplement to the Registration Statement or the Prospectus prepared
and issued by the Company, or the exceptions set forth in any letter of the
Company's independent registered public accounting firm furnished pursuant to
Section 5(e) hereof, shall have made it, in the judgment of the Purchaser,
impracticable or inadvisable to market the Notes or enforce contracts for the
sale of the Notes.
10. Representations and Indemnities to Survive. The respective agreements,
representations, warranties, indemnities and other statements of the Company or
its officers and of you set forth in or made pursuant to this Agreement will
remain in full force and effect, regardless of any investigation made by or on
behalf of you or the Company or any of the officers, directors or controlling
persons referred to in Section 8 hereof, and will survive delivery of and
payment for the Notes. The provisions of the third paragraph of Section 2(a) and
Sections 4(d), 4(h) and 8 hereof shall survive the termination or cancellation
of this Agreement; provided, however, that if at the time of such termination or
cancellation any Purchaser continues to own Notes, the provisions of subsections
(a), (b) and (c) of Section 4 shall also survive such termination or
cancellation of this Agreement.
11. Notices. All communications hereunder will be in writing and effective
only on receipt, and, if sent to any of you, will be mailed, delivered or
telegraphed and confirmed to such of you, at the address specified in Schedule I
hereto; or, if sent to the Company, will be mailed, delivered or telegraphed and
confirmed to it at 000 Xxxxx Xxxxxx, Xxxxxxxxxxxx, Xxx Xxxx 00000-0000,
Attention: Treasurer.
12. Successors. This Agreement will inure to the benefit of and be binding
upon the parties hereto and their respective successors and the officers and
directors and controlling persons referred to in Section 8 hereof, and no other
person will have any right or obligation hereunder.
13. Applicable Law. This Agreement will be governed by and construed in
accordance with the laws of the State of New York applicable to contracts made
and to be performed within the State of New York.
14. Counterparts.This Agreement may be executed in counterparts, which
together shall constitute one and the same instrument. If signed in
counterparts, this Agreement shall not become effective unless at least one
counterpart hereof shall have been executed and delivered on behalf of each
party hereto.
21
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof, whereupon
this letter and your acceptance shall represent a binding agreement among the
Company and you in accordance with its terms.
Very truly yours,
CENTRAL XXXXXX GAS & ELECTRIC CORPORATION
By:
--------------------------------------
Name:
Title:
The foregoing Agreement is
hereby confirmed and accepted
as of the date first written above.
[AGENT]
By:______________________________
Title:
[AGENT]
By:______________________________
Title:
[AGENT]
By:______________________________
Title:
22
SCHEDULE I
Commissions:
The Company agrees to pay each Agent a commission equal to the following
percentage of the principal amount of each Note sold by such Agent:
Term Commission Rate
---- ---------------
From 1 year to less than 18 months ____%
From 18 months to less than 2 years ____%
From 2 years to less than 3 years ____%
From 3 years to less than 4 years ____%
From 4 years to less than 5 years ____%
From 5 years to less than 6 years ____%
From 6 years to less than 7 years ____%
From 7 years to less than 10 years ____%
From 10 years to less than 15 years ____%
From 15 years to less than 20 years ____%
From 20 years up to and including 30 years ____%
By agreement with the
From 30 years up to and including 50 years Agents
Address for Notice to You:
[Notices to [Agent] shall be directed to it at _______________________________.
Notices to [Agent] shall be directed to it at ________________________________.
Notices to [Agent] shall be directed to it at ________________________________.]
EXHIBIT A
Central Xxxxxx Gas & Electric Corporation
Medium-Term Notes, Series F
Administrative Procedures
Medium-Term Notes, Series F (the "Notes"), are to be offered on a
continuing basis by Central Xxxxxx Gas & Electric Corporation (the "Company") in
an aggregate principal amount of up to $140,000,000. [Agent], [Agent] and
[Agent], as agents (each an "Agent" and collectively the "Agents"), have agreed
to use their reasonable best efforts to solicit offers to purchase the Notes.
The Notes are being sold pursuant to a Distribution Agreement between the
Company and the Agents dated __________, 200_ (the "Distribution Agreement"), to
which these administrative procedures are attached as an exhibit.
The Notes will be issued under the Company's Indenture, dated as of April
1, 1992 (the "Indenture"), to U.S. Bank Trust National Association (formerly
known as First Trust of New York, National Association) ("U.S. Bank Trust"), as
successor to Xxxxxx Guaranty Trust Company of New York, as trustee (the
"Trustee"). U.S. Bank Trust will act as the paying agent (the "Paying Agent")
for the payment of principal and premium, if any, and interest on the Notes and
will perform, as the Paying Agent, unless otherwise specified, the other duties
specified herein.
The Notes will rank equally and ratably with all other unsecured and
unsubordinated indebtedness of the Company. The Notes have been registered with
the Securities and Exchange Commission (the "Commission") and may bear interest
at fixed rates or, if issued at a discount, may not bear interest.
Each Note will be represented by either a Global Security (as defined
hereinafter) delivered to U.S. Bank Trust, as agent for The Depository Trust
Company ("DTC"), and recorded in the book-entry system maintained by DTC (a
"Book-Entry Note") or a certificate delivered to the holder thereof or a person
designated by such holder (a "Certificated Note"). Except as set forth in the
Prospectus (as defined in Section 1(c) of the Distribution Agreement), (i) each
Note will be initially issued as a Book-Entry Note and (ii) an owner of a
Book-Entry Note will not be entitled to receive a certificate representing such
Note.
The procedures to be followed during, and the specific terms of, the
solicitation of offers by the Agents and the sale as a result thereof by the
Company are explained below. Book-Entry Notes will be issued in accordance with
the administrative procedures set forth in Part I hereof and Certificated Notes
will be issued in accordance with the administrative procedures set forth in
Part II hereof. Administrative procedures applicable to both Book-Entry Notes
and Certificated Notes are set forth in Part III hereof. Administrative
responsibilities, document control and record-keeping functions will be handled
for the Company by its Controller or
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Treasurer. The Company will promptly advise the Agents and the Trustee in
writing of those persons handling administrative responsibilities with whom the
Agents and the Trustee are to communicate regarding offers to purchase Notes and
the details of their delivery.
To the extent the procedures set forth below conflict with the provisions
of the Notes, the Indenture or the Distribution Agreement, the relevant
provisions of the Notes, the Indenture and the Distribution Agreement shall
control. Unless otherwise defined herein, terms defined in the Indenture shall
be used herein as therein defined.
PART I: ADMINISTRATIVE PROCEDURES FOR BOOK-ENTRY NOTES
In connection with the qualification of the Book-Entry Notes for
eligibility in the book-entry system maintained by DTC, U.S. Bank Trust will
perform the custodial, document control and administrative functions described
below, in accordance with its respective obligations under a Letter of
Representations to be delivered from the Company and U.S. Bank Trust to DTC and
a Medium-Term Note Certificate Agreement between U.S. Bank Trust National
Association (under its then name First Trust, National Association) and DTC,
dated as of January 31, 1991 (the "MTN Certificate Agreement"), and its
obligations as a participant in DTC, including DTC's Same-Day Funds Settlement
System ("SDFS").
Issuance: On any date of settlement (as defined under
"Settlement" below) for one or more Book-Entry
Notes, the Company will issue a single global
security in fully registered form without coupons
(a "Global Security") representing up to
$140,000,000 aggregate principal amount of all
such Notes that have the same date of maturity
("Maturity Date"), redemption provisions, if any,
provisions for the repayment or purchase by the
Company at the option of the Holder, if any,
Interest Payment Dates, Original Issue Date, and
interest rate (in each case, and for all purposes
of these administrative procedures, as defined in
the Prospectus) (as defined in Section 1(c) of
the Distribution Agreement) (collectively, the
"Terms"). Each Global Security will be dated and
issued as of the date of its authentication by
the Trustee. No Global Security will represent
any Certificated Note.
Identification Numbers: The Company has arranged with the CUSIP Service
Bureau of Standard & Poor's Rating Services, a
division of The XxXxxx-Xxxx Companies, Inc. (the
"CUSIP Service Bureau") for the reservation of
one series of CUSIP numbers (including tranche
numbers), which series consists of approximately
900 CUSIP numbers and relates to Global
Securities representing the Book-Entry Notes and
previously issued Medium-Term Notes of the
Company. The Company has obtained from the CUSIP
Service Bureau a written list of such series of
reserved CUSIP numbers and has delivered to DTC
and the Trustee a written list of 900 CUSIP
numbers of such
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series. The Company will assign CUSIP numbers to
Global Securities as described below under
Settlement Procedure "B". It is expected that DTC
will notify the CUSIP Service Bureau periodically
of the CUSIP numbers that the Company has
assigned to Global Securities. At any time when
fewer than 100 of the reserved CUSIP numbers of
the series remain unassigned to Global
Securities, the Trustee shall so advise the
Company and, if it deems necessary, the Company
will reserve additional CUSIP numbers for
assignment to Global Securities representing
Book-Entry Notes. Upon obtaining such additional
CUSIP numbers, the Company shall deliver a list
of such additional CUSIP numbers to the Trustee
and DTC.
Registration: Each Global Security will be registered in the
name of Cede & Co., as nominee for DTC, on the
Security Register maintained under the Indenture.
It is expected that the beneficial owner of a
Book-Entry 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, the "Participants")
to act as agent or agents for such owner in
connection with the book-entry system maintained
by DTC, and it is expected that DTC will record
in book-entry form, in accordance with
instructions provided by such Participants, a
credit balance with respect to such beneficial
owner in such Note in the account of such
Participants. The ownership interest of such
beneficial owner in such 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 Book-Entry 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 transferees and transferors
of such Note.
Consolidations: Upon receipt of written instructions from the
Company, U.S. Bank Trust may deliver to DTC and
the CUSIP Service Bureau at any time a written
notice of consolidation (a copy of which shall be
attached to the resulting Global Security)
specifying (i) the CUSIP numbers of two or more
Outstanding Global Securities that represent
Book-Entry Notes having the same Terms and for
which interest has been paid to the same date,
(ii) a date, occurring at least thirty days after
such written notice is delivered and at least
thirty days before the next Interest Payment Date
for such Book-Entry Notes, on which such Global
Securities shall be exchanged for a single
replacement Global Security and (iii) a new CUSIP
number to be assigned to such replacement Global
Security. Upon
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receipt of such a notice, it is expected that DTC
will send to its participants (including U.S.
Bank Trust) a written reorganization notice to
the effect that such exchange will occur on such
date. Prior to the specified exchange date, U.S.
Bank Trust will deliver to the CUSIP Service
Bureau a 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 Securities to be exchanged
will no longer be valid. On the specified
exchange date, U.S. Bank Trust will exchange such
Global Securities for a single Global Security
bearing the new CUSIP number, and the CUSIP
numbers of the exchanged Global Securities will,
in accordance with CUSIP Service Bureau
procedures, be canceled and not reassigned until
the Book-Entry Notes represented by such
exchanged Global Securities have matured or been
redeemed.
Maturities: Each Book-Entry Note will mature on a date not
less than one year nor more than 50 years after
the date of settlement for such Note.
Denominations: Book-Entry Notes will be issued in principal
amounts of $1,000 or any amount in excess thereof
that is an integral multiple of $1,000. Global
Securities will be denominated in principal
amounts not in excess of $140,000,000.
Interest: General. Interest on each Book-Entry Note will
accrue from and including the original issue date
of, or the last date to which interest has been
paid on, the Global Security representing such
Note. Each payment of interest on a Book-Entry
Note will include interest accrued to but
excluding the Interest Payment Date or the
Maturity Date or, upon earlier redemption or
repayment, the date of such redemption or
repayment (the "Redemption Date"), as the case
may be. Interest payable on the Maturity Date or
the Redemption Date of a Book-Entry Note will be
payable to the person to whom the principal of
such Note is payable. Standard & Poor's Rating
Services, a division of The XxXxxx-Xxxx
Companies, Inc. will use the information received
in the pending deposit message described under
Settlement Procedure "C" below in order to
include the amount of any interest payable and
certain other information regarding the related
Global Security in the appropriate weekly bond
report published by Standard & Poor's
Corporation.
Record Dates. The record date with respect to any
Interest Payment Date shall be the April 15 or
October 15, as the case may be (whether or not a
Business Day) immediately preceding such Interest
Payment Date (each a "Regular Record Date").
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Interest Payment Dates. Interest payments on
Book-Entry Notes will be made semi-annually on
May 1 and November 1 of each year and on the
Maturity Date or the Redemption Date; provided,
however, that in the case of a Book-Entry Note
issued between a Regular Record Date and an
Interest Payment Date, the first interest payment
will be made on the Interest Payment Date
following the next succeeding Regular Record
Date.
Payments of Principal Payment of Interest Only. Promptly after each
and Interest: Regular Record Date, the Paying Agent will
deliver to the Company and DTC a written notice
specifying by CUSIP number the amount of interest
to be paid on each Global Security on the
following Interest Payment Date (other than an
Interest Payment Date coinciding with the
Maturity Date) and the total of such amounts. It
is expected that DTC will confirm the amount
payable on each Global Security on such Interest
Payment Date by reference to the appropriate
(daily or weekly) bond reports published by
Standard & Poor's Corporation. The Company will
pay to the Paying Agent the total amount of
interest due on such Interest Payment Date (other
than on the Maturity Date), and the Paying Agent
will pay such amount to DTC at the times and in
the manner set forth under "Manner of Payment"
below. If any Interest Payment Date for a
Book-Entry Note is not a Business Day, the
payment due on such day shall be made on the next
succeeding Business Day, and no interest shall
accrue on such payment for the period from and
after such Interest Payment Date.
Payments on Maturity Date, Etc. On or about the
first Business Day of each month, the Paying
Agent will deliver to the Company and DTC a
written list of principal and, to the extent
known at such time, interest to be paid on each
Global Security maturing either on the Maturity
Date or the Redemption Date in the following
month. The Company and DTC will confirm with the
Paying Agent the amounts of such principal and
interest payments with respect to each such
Global Security on or about the fifth Business
Day preceding the Maturity Date or the Redemption
Date, as the case may be, of such Global
Security. The Company will pay to the Paying
Agent the principal amount of such Global
Security, together with interest due on such
Maturity Date or Redemption Date in the manner
set forth below under "Manner of Payment". The
Paying Agent will pay such amounts to DTC at the
times and in the manner set forth below under
"Manner of Payment". If the Maturity Date or the
Redemption Date of a Global Security representing
Book-Entry Notes is not a Business Day, the
payment due on such day shall be made on the next
succeeding Business Day, and no interest shall
accrue on such payment for the period
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from and after such Maturity Date or the
Redemption Date. Promptly after payment to DTC of
the principal and interest due at the Maturity
Date or the Redemption Date of such Global
Security, the Paying Agent will cancel such
Global Security in accordance with the terms of
the Indenture.
Manner of Payment. The total amount of any
principal and interest due on Global Securities
on any Interest Payment Date or on the Maturity
Date or the Redemption Date shall be paid by the
Company to the Paying Agent in immediately
available funds for use by the Paying Agent no
later than 9:30 A.M. (New York City time) on such
date. The Company will make such payment on such
Global Securities by wire transfer to the Paying
Agent or by the Paying Agent's debiting the
account of the Company maintained with the Paying
Agent. The Company will confirm such instructions
in writing to the Paying Agent. Prior to 10:00
A.M. (New York City time) on each Maturity Date
or Redemption Date or as soon as reasonably
possible thereafter, the Paying Agent will pay by
separate wire transfer (using Fedwire message
entry instructions in a form previously agreed to
with DTC) to an account at the Federal Reserve
Bank of New York previously agreed to with DTC,
in funds available for immediate use by DTC, each
payment of principal (together with interest
thereon) due on Global Securities on any Maturity
Date or Redemption Date. On each Interest Payment
Date, interest payments shall be made to DTC in
same day funds in accordance with existing
arrangements between the Paying Agent and DTC.
Thereafter, on each such date, it is expected
that 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
Book-Entry Notes represented by such Global
Securities are recorded in the book-entry system
maintained by DTC. Neither the Company nor the
Paying Agent shall have any responsibility or
liability for the payment by DTC to such
Participants of the principal of and interest on
the Book-Entry Notes.
Withholding Taxes. The amount of any taxes
required under applicable law to be withheld from
any interest payment on a Book-Entry 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 Note.
Settlement: The receipt by the Company of immediately
available funds in payment for a Book-Entry Note
and the authentication and
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issuance of the Global Security representing such
Note shall constitute "settlement" with respect
to such Note. All orders accepted by the Company
will be settled on the third Business Day
following the date of sale of a Book-Entry Note
unless the Company, the Trustee and the purchaser
agree to settlement on another day that shall be
no earlier than the next Business Day.
Settlement Procedures: Settlement Procedures with regard to each
Book-Entry Note sold by the Company through an
Agent, as agent, shall be as follows:
A. Such Agent will advise the Company by
telephone, followed by facsimile
transmission, of the following settlement
information:
1. Principal amount.
2. Maturity Date.
3. The interest rate.
4. Interest Payment Dates.
5. Redemption provisions, if any, or
provisions for the repayment or
purchase by the Company at the option
of the Holder, if any.
6. Settlement date.
7. Issue price.
8. Agent's commission, determined as
provided in Section 2(a) of the
Distribution Agreement.
B. The Company will assign a CUSIP number to
such Book-Entry Note and will advise U.S.
Bank Trust by facsimile transmission or
other mutually acceptable means of the
information set forth in Settlement
Procedure "A" above, the name of such Agent
and the CUSIP number assigned to such
Book-Entry Note. The Company will notify
the Agent of such CUSIP number by telephone
as soon as practicable. Each such
communication by the Company shall
constitute a representation and warranty by
the Company to U.S. Bank Trust and each
Agent that (i) such Note is then, and at
the time of issuance and sale thereof will
be, duly authorized for issuance and sale
by the Company, (ii) the Global Security
representing such Note will conform with
the terms of the Indenture pursuant to
which such Note and Global Security
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are issued and (iii) upon authentication
and delivery of such Global Security, the
aggregate principal amount of all Notes
initially offered issued under the
Indenture will not exceed $140,000,000
(except for Global Securities or Notes
represented by and authenticated and
delivered in exchange for or in lieu of
Notes in accordance with the Indenture).
C. U.S. Bank Trust will enter a pending
deposit message through DTC's Participant
Terminal System, providing the following
settlement information to DTC, which shall
route such information to such Agent and
Standard & Poor's Rating Services, a
division of The XxXxxx-Xxxx Companies,
Inc.:
1. The information set forth in
Settlement Procedure "A".
2. Identification of such Note as a fixed
rate Book-Entry Note.
3. Initial Interest Payment Date for such
Note, number of days by which such
date succeeds the related Regular
Record Date (which shall be the
Regular Record Date as defined in the
Note) and amount of interest payable
on such Interest Payment Date.
4. CUSIP number of the Global Security
representing such Note.
5. Whether such Global Security will
represent any other Book-Entry Note
(to the extent known at such time).
D. The Trustee will complete and authenticate
the Global Security representing such Note.
E. It is expected that DTC will credit such
Note to U.S. Bank Trust's participant
account at DTC.
F. U.S. Bank Trust will enter an SDFS deliver
order through DTC's Participant Terminal
System instructing DTC to (i) debit such
Note to U.S. Bank Trust's participant
account and credit such Note to such
Agent's participant account and (ii) debit
such Agent's settlement account and credit
U.S. Bank Trust's settlement account for an
amount equal to the price of such Note less
such Agent's commission. The entry of such
a deliver order shall constitute a
representation and warranty by U.S. Bank
Trust to DTC that (a) the Global Security
representing such Book-Entry Note has been
issued and
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authenticated and (b) U.S. Bank Trust is
holding such Global Security pursuant to
the MTN Certificate Agreement.
G. Such Agent will enter an SDFS deliver order
through DTC's Participant Terminal System
instructing DTC (i) to debit such Note to
such Agent's participant account and credit
such Note to the participant accounts of
the Participants with respect to such Note
and (ii) to debit the settlement accounts
of such Participants and credit the
settlement account of such Agent for an
amount equal to the price of such Note.
H. Transfers of funds in accordance with SDFS
deliver orders described in Settlement
Procedures "F" and "G" will be settled in
accordance with SDFS operating procedures
in effect on the settlement date.
I. U.S. Bank Trust will, upon confirming
receipt of such funds from the Agent, wire
transfer to the account of the Company
maintained at The Bank of Xxx Xxxx, Xxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (for
credit to Central Xxxxxx Gas & Electric
Corporation, The Bank of New York - Special
Acct. #2, ABA Routing No.: 000000000
Account No. 8751004282) in immediately
available funds in the amount transferred
to U.S. Bank Trust in accordance with
Settlement Procedure "F". Promptly upon
completion of such wire transfer, U.S. Bank
Trust shall notify the Company thereof by
telephone (Attn. Cash Management
Specialist, Tel. No. 000-000-0000, or such
other person or telephone number, as the
Company shall request of U.S. Bank Trust).
J. Such Agent will confirm the purchase of
such Note to the purchaser either by
transmitting to the Participants with
respect to such Note a confirmation order
or orders through DTC's institutional
delivery system or by mailing a written
confirmation to such purchaser.
Settlement Procedures For orders of Book-Entry Notes solicited by an
Timetable: Agent, as agent, and accepted by the Company for
settlement on the first Business Day after the
sale date, Settlement Procedures "A" through "J"
set forth above shall be completed as soon as
possible but not later than the respective times
(New York City time) set forth below:
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Settlement
Procedure Time
--------- ----
A 11:00 A.M. on the sale date
B 12:00 Noon on the sale date
C 5:00 P.M. on the sale date
D 3:00 P.M. on the sale date
E 8:05 A.M. on the settlement date
F-G 3:00 P.M. on the settlement date
H 4:45 P.M. on the settlement date
I-J 5:00 P.M. on the settlement date
If a sale is to be settled more than one Business
Day after the sale date, Settlement Procedures
"A", "B" and "C" shall be completed as soon as
practicable but no later than 11:00 A.M. and
12:00 Noon on the first Business Day after the
sale date with respect to Settlement Procedures
"A" and "B", respectively, and no later than 5:00
P.M. on the first Business Day after the sale
date, with respect to Settlement Procedure "C".
Settlement Procedure "D" shall occur no later
than 3:00 P.M. on the last Business Day prior to
the settlement date. Settlement Procedures "H"
and "I" are 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 settlement
date.
If settlement of a Book-Entry Note is rescheduled
or canceled, the Company will instruct U.S. Bank
Trust by no later than 12:00 Noon on the Business
Day immediately preceding the scheduled
settlement date to deliver to DTC through DTC's
Participant Terminal System a cancellation
message to such effect and U.S. Bank Trust will
enter such message, by no later than 2:00 P.M. on
such Business Day, through DTC's Participation
Terminal System.
Monthly Reports: Monthly, the Trustee will send to the Company a
statement setting forth the principal amount of
Notes outstanding as of that date under the
Indenture and setting forth a brief description
of any sales of which the Company has advised the
Trustee but which have not yet been settled.
Failure to Settle: If U.S. Bank Trust or the Agent fails to enter an
SDFS deliver order with respect to a Book-Entry
Note pursuant to Settlement Procedure "F" or "G,"
U.S. Bank Trust may upon the approval of the
Company deliver to DTC, through DTC's Participant
Terminal System, as soon as practicable, a
withdrawal message instructing DTC to debit such
Note to U.S. Bank Trust's participant account,
provided that U.S. Bank Trust's participant
account contains a
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principal amount of the Global Security
representing such Note that is at least equal to
the principal amount to be debited. If a
withdrawal message is processed with respect to
all the Book-Entry Notes represented by a Global
Security, U.S. Bank Trust will xxxx such Global
Security "canceled", make appropriate entries in
U.S. Bank Trust's records and send such canceled
Global Security to the Company. The CUSIP number
assigned to such Global Security shall, in
accordance with CUSIP Service Bureau procedures,
be canceled and not reassigned until the
Book-Entry Notes represented by such Global
Security have matured or been redeemed. If a
withdrawal message is processed with respect to
one or more, but not all, of the Book-Entry Notes
represented by a Global Security, U.S. Bank Trust
will exchange such Global Security for another
Global Security, which shall represent the
Book-Entry Notes previously represented by the
surrendered Global Security with respect to which
a withdrawal message has not been processed and
shall bear the CUSIP number of the surrendered
Global Security.
If the purchase price for any Book-Entry Note is
not timely paid to the Participants with respect
to such 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 Agent for such
Note may enter SDFS deliver orders through DTC's
Participant Terminal System reversing the orders
entered pursuant to Settlement Procedures "G" and
"F", respectively. Thereafter, U.S. Bank Trust
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 a default by the Agent
in the performance of its obligations hereunder
or under the Distribution Agreement, then the
Company will reimburse such Agent or U.S. Bank
Trust, for the account of such Agent, as
applicable, on an equitable basis for the loss of
the use of funds during the period when they 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 one or
more, but not all, of the Book-Entry Notes to
have been represented by a Global Security, the
Trustee will provide, in accordance with
Settlement Procedure "D," for the authentication
and issuance of a Global Security representing
the other Book-Entry Notes to have been
represented by such Global Security and will make
appropriate entries in its records.
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PART II: ADMINISTRATIVE PROCEDURES FOR CERTIFICATED NOTES
U.S. Bank Trust will serve as registrar in connection with the
Certificated Notes.
Maturities: Each Certificated Note will mature on a date not less
than one year and not more than 50 years after the
date of delivery by the Company of such Note.
Price to Public: Each Certificated Note will be issued at the
percentage of principal amount specified in the
Prospectus relating to the Notes.
Denominations: The denomination of any Certificated Note will be a
minimum of $1,000 or any amount in excess thereof
which is an integral multiple of $1,000.
Registration: Certificated Notes will be issued only in fully
registered form.
Interest: General. Interest on each Certificated Note will
accrue from and including the original issue date of,
or the last date to which interest has been paid on,
such Note. Each payment of interest on a Certificated
Note will include interest accrued to but excluding
the Interest Payment Date or the Maturity Date or,
upon earlier redemption, the Redemption Date, as the
case may be. Interest payable on the Maturity Date or
the Redemption Date of a Certificated Note will be
payable to the person to whom the principal of such
Note is payable.
Record Dates. Unless otherwise set forth in the
applicable Pricing Supplement, the record dates with
respect to the Interest Payment Dates shall be the
Regular Record Dates.
Interest Payment Date. Unless otherwise specified
pursuant to "Settlement Procedures" below, interest
payments on Certificated Notes will be made
semi-annually on May 1 and November 1 and on the
Maturity Date or the Redemption Date; provided,
however, that in the case of a Certificated Note
issued between a Regular Record Date and an Interest
Payment Date, the first interest payment will be made
on the Interest Payment Date following the next
succeeding Regular Record Date.
Payments of Principal Interest will be payable to the person in whose name
and Interest: a Certificated Note is registered at the close of
business on the Regular Record Date next preceding an
Interest Payment Date; provided, however, that, in
the case of a Certificated Note originally issued
between a Regular Record Date and an Interest Payment
Date, the first payment of interest will be made on
the Interest Payment Date following the next
succeeding Regular Record Date to the person
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in whose name such Note was registered at the close
of business on such next Regular Record Date. Unless
other arrangements are made acceptable to the
Company, all interest payments (excluding interest
payments made on the Maturity Date or the Redemption
Date) on a Certificated Note will be made by check
mailed to the person entitled thereto as provided
above.
U.S. Bank Trust will pay the principal amount of each
Certificated Note on the Maturity Date upon
presentation of such Certificated Note to U.S. Bank
Trust at the principal corporate trust office of U.S.
Bank Trust in New York, New York. Such payment,
together with payment of interest due on the Maturity
Date, will be made from funds deposited with U.S.
Bank Trust by the Company.
U.S. Bank Trust will be responsible for compliance
with withholding taxes on interest paid on
Certificated Notes by it as required by applicable
federal law.
Within 10 days following each Regular Record Date,
the Trustee will inform the Company of the total
amount of the interest payments to be made by the
Company on the next succeeding Interest Payment Date.
The Trustee will provide monthly to the Company a
list of the principal and interest to be paid on
Certificated Notes maturing in the next succeeding
month.
Settlement: The settlement date with respect to any offer to
purchase Certificated Notes accepted by the Company
will be a date on or before the third Business Day
next succeeding the date of acceptance unless
otherwise agreed by the purchaser, the Trustee and
the Company and shall be specified upon acceptance of
such offer. The Company will instruct the Trustee to
effect delivery of each Certificated Note no later
than 1:00 P.M. (New York City time) on the settlement
date to the Presenting Agent (as defined under
"Preparation of Pricing Supplement" in Part III
below) for delivery to the purchaser.
Settlement Procedures: For each offer to purchase a Certificated Note that
is accepted by the Company, the Presenting Agent will
provide (unless provided by the purchaser directly to
the Company) by telephone and facsimile transmission
or other mutually acceptable means the following
information to the Company:
1. Name in which such Note is to be registered
(the "Registered Owner").
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2. Address of the Registered Owner and, if
different, address for payment of principal and
interest.
3. Taxpayer identification number of the
Registered Owner.
4. Principal amount.
5. Maturity Date.
6. The interest rate.
7. Interest Payment Dates.
8. Redemption provisions, if any, or provisions
for the repayment or repurchase by the Company
at the option of the Holder, if any.
9. Settlement date.
10. Issue price.
11. Agent's commission, determined as provided in
Section 2(a) of the Distribution Agreement.
The Presenting Agent will advise the Company of the
foregoing information (unless provided by the
purchaser directly to the Company) for each offer to
purchase a Certificated Note solicited by such Agent
and accepted by the Company in time for the Trustee
to prepare and authenticate the required Certificated
Note. Before accepting any offer to purchase a
Certificated Note to be settled in less than three
Business Days, the Company shall verify that the
Trustee will have adequate time to prepare and
authenticate such Note. After receiving from the
Presenting Agent the details for each offer to
purchase a Certificated Note that has been accepted
by the Company, the Company will, after recording the
details and any necessary calculations, provide
appropriate documentation to the Trustee, including
the information provided by the Presenting Agent
necessary for the preparation and authentication of
such Note.
Note Deliveries Upon receipt of appropriate documentation and
and Cash Payment: instructions, the Company will cause the Trustee to
prepare and authenticate the pre-printed 4-ply
Certificated Note packet containing the following
documents in forms approved by the Company, the
Presenting Agent and the Trustee:
1. Note with customer receipt.
2. Stub 1 - For the Presenting Agent
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3. Stub 2 - For the Company.
4. Stub 3 - For the Trustee.
Each Certificated Note shall be authenticated on the
settlement date therefor. The Trustee will
authenticate each Certificated Note and deliver it
(with the confirmation) to the Presenting Agent (and
deliver the stubs as indicated above), all in
accordance with written or electronic instructions
(or oral instructions confirmed in writing (which may
be given by facsimile transmission) on the next
Business Day) from the Company. Delivery by the
Trustee of each Certificated Note will be made in
accordance with said instructions against receipts
therefor and in connection with contemporaneous
receipt by the Company from the Presenting Agent on
the settlement date in immediately available funds of
an amount equal to the issue price of such Note less
the Presenting Agent's commission.
Upon verification ("Verification") by the Presenting
Agent that a Certificated Note has been prepared and
properly authenticated by the Trustee and registered
in the name of the purchaser in the proper principal
amount and other terms in accordance with the
aforementioned confirmation, payment will be made to
the Company by the Presenting Agent the same day as
the Presenting Agent's receipt of the Certificated
Note in immediately available funds. Such payment
shall be made by the Presenting Agent only upon prior
receipt by the Presenting Agent of immediately
available funds from or on behalf of the purchaser
unless the Presenting Agent decides, at its option,
to advance its own funds for such payment against
subsequent receipt of funds from the purchaser.
Upon delivery of a Certificated Note to the
Presenting Agent, Verification by the Presenting
Agent and the giving of instructions for payment, the
Presenting Agent shall promptly deliver such Note to
the purchaser.
In the event any Certificated Note is incorrectly
prepared, the Trustee shall promptly issue a
replacement Certificated Note in exchange for such
incorrectly prepared Note.
Failure to Settle: If the Presenting Agent, at its own option, has
advanced its own funds for payment against subsequent
receipt of funds from the purchaser, and if the
purchaser shall fail to make payment for the
Certificated Note on the settlement date therefor,
the Presenting Agent will promptly notify the Trustee
and the Company by telephone, promptly confirmed in
writing (but no later than the
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next Business Day). In such event, the Company shall
promptly provide the Trustee with appropriate
documentation and instructions consistent with these
procedures for the return of the Certificated Note to
the Trustee and the Presenting Agent will promptly
return the Certificated Note to the Trustee. Upon (i)
confirmation from the Trustee in writing (which may
be given by facsimile transmission) that the Trustee
has received the Certificated Note and upon (ii)
confirmation from the Presenting Agent in writing
(which may be given by facsimile transmission) that
the Presenting Agent has not received payment from
the purchaser (the matters referred to in clauses (i)
and (ii) are referred to hereinafter as the
"Confirmations"), the Company will promptly pay to
the Presenting Agent an amount in immediately
available funds equal to the amount previously paid
by the Presenting Agent in respect of such Note.
Assuming receipt of the Certificated Note by the
Trustee and of the Confirmations by the Company, such
payment will be made on the settlement date, if
reasonably practical, and in any event not later than
the Business Day following the date of receipt of the
Certificated Note and Confirmations. If a purchaser
shall fail to make payment for the Certificated Note
for any reason other than the failure of the
Presenting Agent to provide the necessary information
to the Company as described above for settlement or
to provide a confirmation to the purchaser within a
reasonable period of time as described above or
otherwise to satisfy its obligation hereunder or in
the Distribution Agreement, and if the Presenting
Agent shall have otherwise complied with its
obligations hereunder and in the Distribution
Agreement, the Company will reimburse the Presenting
Agent on an equitable basis for its loss of the use
of funds during the period when they 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 void such Note, make appropriate entries in its
records and send such cancelled Note to the Company;
and upon such action, the Certificated Note will be
deemed not to have been issued, authenticated and
delivered.
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PART III: ADMINISTRATIVE PROCEDURES APPLICABLE TO BOTH BOOK-ENTRY NOTES AND
CERTIFICATED NOTES
Calculation of Interest: Interest on Notes (including interest for partial
periods) will be calculated on the basis of a
360-day year of twelve thirty-day months.
(Examples of interest calculations are as follows:
The period from August 15, 2005 to February 15,
2006 equals 6 months and 0 days, or 180 days; the
interest payable equals 180/360 times the annual
rate of interest times the principal amount of the
Note. The period from September 17, 2005 to
February 15, 2006 equals 4 months and 28 days, or
148 days; the interest payable equals 148/360
times the annual rate of interest times the
principal amount of the Note.)
Procedure for Rate The Company and the Agents will discuss from time
Setting and Posting: to time the aggregate amount of, the issuance
price of, and the interest rates to be borne by,
Notes that may be sold as a result of the
solicitation of offers by the Agents. If the
Company decides to set prices of, and rates borne
by, any Notes in respect of which the Agents are
to solicit offers (the setting of such prices and
rates to be referred to herein as "posting") or if
the Company decides to change prices or rates
previously posted by it, it will promptly advise
the Agents of the prices and rates to be posted.
Acceptance of Offers: If the Company posts prices and rates as provided
above, each Agent as agent for and on behalf of
the Company, shall promptly accept offers received
by such Agent to purchase Notes at the prices and
rates so posted, subject to (i) any instructions
from the Company received by such Agent concerning
the aggregate principal amount of such Notes to be
sold at the prices and rates so posted or the
period during which such posted prices and rates
are to be in effect, (ii) any instructions from
the Company received by such Agent changing or
revoking any posted prices and rates, (iii)
compliance with the securities laws of the United
States and all other jurisdictions and (iv) such
Agent's right to reject any such offer as provided
below.
If the Company does not post prices and rates and
an Agent receives an offer to purchase Notes or,
if while posted prices and rates are in effect, an
Agent receives an offer to purchase Notes on terms
other than those posted by the Company, such Agent
will promptly advise the Company of each such
offer other than offers rejected by such Agent as
provided below. The Company will have the sole
right to accept any such offer to purchase Notes.
The Company may reject any such offer in whole or
in part.
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Each Agent may, in its discretion reasonably
exercised, reject any offer to purchase Notes
received by it in whole or in part.
Preparation of If any offer to purchase a Note is accepted by the
Pricing Supplement: Company, the Company, with the approval of the
Agent that presented such offer (the "Presenting
Agent"), will prepare a pricing supplement (a
"Pricing Supplement") reflecting the terms of such
Note and will arrange to have a copy
electronically filed with the Commission in
accordance with the applicable paragraph of Rule
424 under the Act and the provision of Regulation
S-T thereunder and will supply at least 10 copies
thereof (or additional copies if requested) to the
Presenting Agent. The Presenting Agent will cause
a Prospectus and Pricing Supplement to be
delivered to the purchaser of such Note.
In each instance that a Pricing Supplement is
prepared, the Agents will affix the Pricing
Supplement to Prospectuses prior to their use.
Outdated Pricing Supplements (other than those
retained for files) will be destroyed.
Procedures for When the Company has determined to change the
Rate Changes: interest rates of Notes being offered, it will
promptly advise the Agents and the Agents will
forthwith suspend solicitation of offers. The
Agents will telephone the Company with
recommendations as to the changed interest rates.
At such time as the Company has advised the Agents
of the new interest rates, the Agents may resume
solicitation of offers. Until such time only
"indications of interest" may be recorded.
Suspension of Solicitation; The Company may instruct the Agents to suspend at
Amendment or Supplement any time, for any period of time or permanently,
of Prospectus: the solicitation of offers to purchase Notes. Upon
receipt of such instructions from the Company, the
Agents will forthwith suspend solicitation of
offers to purchase Notes from the Company until
such time as the Company has advised them that
such solicitation may be resumed.
If the Company decides to amend or supplement the
Registration Statement (as defined in Section 1(c)
of the Distribution Agreement) or the Prospectus
(except for a supplement relating to an offering
of securities other than the Notes), it will
promptly advise the Agents and the Trustee and
will furnish the Agents and the Trustee with the
proposed amendment or supplement in accordance
with the terms of, and its obligations under, the
Distribution Agreement. The Company will,
consistent with such obligations, promptly advise
each Agent and the Trustee whether orders
outstanding at the time each Agent suspends
solicitation
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may be settled and whether copies of such
Prospectus and Prospectus Supplement as in effect
at the time of the suspension, together with the
appropriate Pricing Supplement, 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 that may be
made in the event that the Company determines that
such orders may not be settled or that copies of
such Prospectus, Prospectus Supplement and Pricing
Supplement may not be so delivered.
The Company will file with the Commission for
filing therewith any supplement to the Prospectus
relating to the Notes, provide the Agents with
copies of any such supplement, and confirm to the
Agents that such supplement has been filed with
the Commission pursuant to the applicable
paragraph of Rule 424.
Confirmation: For each offer to purchase a Note solicited by an
Agent and accepted by or on behalf of the Company,
the Presenting Agent will issue a confirmation to
the purchaser, with a copy to the Company, setting
forth the details set forth above and delivery and
payment instructions.
Trustee/Paying Agent Nothing herein shall be deemed to require the
Not to Risk Funds: Trustee or Paying Agent to risk or expend its own
funds in connection with any payment to the
Company, DTC, the Agents or the purchaser or a
holder, it being understood by all parties that
payments made by the Trustee/Paying Agent to the
Company, DTC, the Agents or a purchaser or holder
shall be made only to the extent that funds are
provided to the Trustee/Paying Agent for such
purpose.
Authenticity The Company will cause the Trustee to furnish the
of Signatures: Agents from time to time with the specimen
signatures of each of the Trustee's officers,
employees or agents who has been authorized by the
Trustee to authenticate Notes, but 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 such Note.
Payment of Expenses: Each Agent shall forward to the Company, on a
monthly basis, a statement of the reasonable
out-of-pocket expenses incurred by such Agent
during that month which are reimbursable to it
pursuant to the terms of the Distribution
Agreement. The Company will remit payment to the
Agents currently on a monthly basis.
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Delivery of Prospectus: A copy of the Prospectus, Prospectus Supplement
and Pricing Supplement relating to a Note must
accompany or precede the earliest of any written
offer of such Note, confirmation of the purchase
of such Note or payment for such Note by its
purchaser. If notice of a change in the terms of
the Notes is received by an Agent between the time
an order for a Note is placed and the time written
confirmation thereof is sent by such Agent to a
customer or his agent, such confirmation shall be
accompanied by a Prospectus, Prospectus Supplement
and Pricing Supplement setting forth the terms in
effect when the order was placed. Subject to
"Suspension of Solicitation; Amendment or
Supplement of Prospectus" above, each Agent will
deliver a Prospectus, Prospectus Supplement and
Pricing Supplement as herein described with
respect to each Note sold by it.
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EXHIBIT B
TERMS AGREEMENT
Central Xxxxxx Gas & Electric Corporation
000 Xxxxx Xxxxxx
Xxxxxxxxxxxx, Xxx Xxxx 00000-0000
Attention:
Subject in all respects to the terms and conditions of the Distribution
Agreement (the "Distribution Agreement"), dated ____________, 200_ among
[Agent], [Agent], and [Agent] and Central Xxxxxx Gas & Electric Corporation (the
"Company"), the undersigned agrees to purchase the following principal amount of
the Company's $140,000,000 Medium-Term Notes, Series F (the "Notes"):
Aggregate Principal Amount: $
Interest Rate:
Date of Maturity:
Interest Payment Dates:
Regular Record Dates:
Purchase Price: % of Principal Amount [plus accrued interest from
____________, 200_]
Purchase Date and Time:
Place for Delivery of Notes
and Payment Therefor:
Method of Payment:
B-1
Modification, if any, in the requirements
to deliver the documents specified in
Section 6(b) of the Distribution Agreement:
Period during which additional Notes
may not be sold pursuant to Section 4(m)
of the Distribution Agreement:
Book-Entry Notes or Certificated Notes:
This Agreement shall be governed by and construed in accordance with the
laws of New York.
[Insert name of Purchaser[s]]
By__________________________
Title:
Accepted:________________, ____
CENTRAL XXXXXX GAS & ELECTRIC
CORPORATION
By___________________________________
Title:
452123
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