OFFER TO PURCHASE FOR CASH
6,540,670 SHARES OF COMMON STOCK
OF
NEW YORK STATE ELECTRIC & GAS CORPORATION
AT
$24.50 NET PER SHARE
BY
CE ELECTRIC (NY), INC.
A WHOLLY OWNED SUBSIDIARY OF
CALENERGY COMPANY, INC.
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THE OFFER, THE PRORATION PERIOD AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00
MIDNIGHT, NEW YORK CITY TIME, ON THURSDAY, AUGUST 14, 1997, UNLESS THE OFFER
IS EXTENDED.
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July 18, 1997
To Our Clients:
Enclosed for your consideration are an Offer to Purchase dated July 18,
1997 (the "Offer to Purchase") and the related Letter of Transmittal (which
together constitute the "Offer") relating to an offer by CE Electric (NY),
Inc., a New York corporation (the "Purchaser") and a wholly owned subsidiary
of CalEnergy Company, Inc. ("CalEnergy"), to purchase 6,540,670 shares of
common stock, par value $6.66 2/3 per share (the "Shares"), of New York State
Electric & Gas Corporation, a New York corporation (the "Company"), at $24.50
per Share, net to the seller in cash, without interest thereon, upon the
terms and subject to the conditions set forth in the Offer.
Holders of Shares whose certificates for such Shares ("Certificates") are
not immediately available or who cannot deliver their Certificates and all
other required documents to the Depositary on or prior to the expiration of
the Offer (the "Expiration Date"), or who cannot complete the procedures for
book-entry transfer on a timely basis, must tender their Shares according to
the guaranteed delivery procedures set forth in Section 4 of the Offer to
Purchase.
THIS MATERIAL IS BEING FORWARDED TO YOU AS THE BENEFICIAL OWNER OF SHARES
CARRIED BY US IN YOUR ACCOUNT BUT NOT REGISTERED IN YOUR NAME. A TENDER OF
SUCH SHARES CAN BE MADE ONLY BY US AS THE HOLDER OF RECORD AND PURSUANT TO
YOUR INSTRUCTIONS. THE LETTER OF TRANSMITTAL IS FURNISHED TO YOU FOR YOUR
INFORMATION ONLY AND CANNOT BE USED BY YOU TO TENDER SHARES HELD BY US FOR
YOUR ACCOUNT. ACCORDINGLY, WE REQUIRE INSTRUCTIONS AS TO WHETHER YOU WISH TO
TENDER ANY OR ALL OF SUCH SHARES HELD BY US FOR YOUR ACCOUNT, UPON THE TERMS
AND SUBJECT TO THE CONDITIONS SET FORTH IN THE OFFER.
Please note the following:
1. The Purchaser is offering to purchase 6,540,670 Shares at $24.50 per
Share, net to the seller in cash, without interest thereon, upon the terms
and subject to the conditions set forth in the Offer. Holders tendering their
Shares will be entitled to retain the regular $.35 quarterly dividend payable
on August 15, 1997 to holders of record as of July 25, 1997. See Section 14
of the Offer to Purchase.
2. The Offer, the proration period and withdrawal rights will expire at
12:00 Midnight, New York City time, on Thursday, August 14, 1997, unless the
Offer is extended.
3. The Offer is conditioned upon, among other things, (1) there being
validly tendered and not withdrawn prior to the expiration of the Offer that
number of Shares which, together with Shares beneficially owned by the
Purchaser, represents 9.9% of the total number of outstanding Shares of New
York State Electric & Gas Corporation, and (2) the expiration or termination
of all waiting periods imposed by the Xxxx-Xxxxx-Xxxxxx Antitrust
Improvements Act of 1976, as amended, and the regulations thereunder. Certain
other conditions to the consummation of the Offer are described in Section 12
of the Offer to Purchase. The Purchaser expressly reserves the right to waive
any one or more of the conditions of the Offer.
4. Tendering shareholders will not be obligated to pay brokerage fees or
commissions or, except as set forth in Instruction 6 of the Letter of
Transmittal, stock transfer taxes on the purchase of Shares pursuant to the
Offer.
5. Payment for Shares accepted for payment pursuant to the Offer will be
made only after timely receipt by the Depositary of (i) certificates for such
Shares or timely confirmation of the book-entry transfer of such Shares, into
the Depositary's account at The Depository Trust Company or Philadelphia
Depository Trust Company (collectively, the "Book-Entry Transfer
Facilities"), pursuant to the procedures set forth in Section 4 of the Offer
to Purchase, (ii) the Letter of Transmittal (or a facsimile thereof),
properly completed and duly executed, with any required signature guarantees
or an Agent's Message (as defined in the Offer to Purchase) (as described in
Section 4 of the Offer to Purchase) in connection with a book-entry transfer,
and (iii) any other documents required by the Letter of Transmittal.
Accordingly, payment may not be made to all tendering shareholders at the
same time depending upon when certificates for, or confirmations of
book-entry transfer of, such Shares into the Depositary's account at a
Book-Entry Transfer Facility are actually received by the Depositary.
If you wish to have us tender any or all of the Shares held by us for your
account, please so instruct us by completing, executing and returning to us
the instruction form contained in this letter. If you authorize a tender of
your Shares, all such Shares will be tendered unless otherwise indicated in
such instruction form. Please forward your instructions to us in ample time
to permit us to submit a tender on your behalf prior to the expiration of the
Offer. The Letter of Transmittal is furnished to you for your information
only and cannot be used by you to tender Shares held by us for your account.
The Purchaser is not aware of any state where the making of the Offer is
prohibited by administrative or judicial action pursuant to state statute. If
the Purchaser becomes aware of any state where the making of the Offer is so
prohibited, the Purchaser will make a good faith effort to comply with any
such statute or seek to have such statute declared inapplicable to the Offer.
If, after such good faith effort, the Purchaser cannot comply with any
applicable statute, the Offer will not be made to (nor will tenders be
accepted from or on behalf of) the holders of Shares in such states. In those
jurisdictions where the laws require the Offer to be made by a licensed
broker or dealer, the Offer is being made on behalf of the Purchaser by
Xxxxxx Brothers Inc., Credit Suisse First Boston Corporation or one or more
registered brokers or dealers that are licensed under the laws of such
jurisdiction.
INSTRUCTIONS WITH RESPECT TO THE OFFER TO PURCHASE FOR CASH
6,540,670 SHARES OF COMMON STOCK
OF
NEW YORK STATE ELECTRIC & GAS CORPORATION
The undersigned acknowledge(s) receipt of your letter and the enclosed
Offer to Purchase dated July 18, 1997 (the "Offer to Purchase") and the
related Letter of Transmittal (which together constitute the "Offer")
relating to the offer by CE Electric (NY), Inc., a New York corporation (the
"Purchaser") and wholly owned subsidiary of CalEnergy Company, Inc., a
Delaware corporation ("CalEnergy"), to purchase 6,540,670 shares of common
stock, par value $6.66 2/3 per share (the "Shares"), of New York State
Electric & Gas Corporation, a New York corporation, at $24.50 per Share, net
to the seller in cash, without interest thereon upon the terms and subject to
the conditions set forth in the Offer to Purchase and in the related Letter
of Transmittal.
This will instruct you to tender to the Purchaser the number of Shares
indicated below (or if no number is indicated below, all Shares) which are
held by you for the account of the undersigned, upon the terms and subject to
the conditions set forth in the Offer.
Dated:
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Signatures
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Print Name(s)
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Number of Shares to be Tendered*
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Shares Print Address
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Area Code and Telephone Number
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Tax Identification or Social
Security Number
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* Unless otherwise indicated, it will be assumed that all Shares held by us
for your account are to be tendered.
