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EXHIBIT 1.2
ILLINOIS POWER COMPANY
UNSECURED DEBT SECURITIES
UNDERWRITING AGREEMENT
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Chicago, Illinois
To the Representative(s) named in Schedule I hereto of the Underwriters named in
Schedule II hereto.
Dear Sirs:
Illinois Power Company, an Illinois corporation (the "Company"),
proposes to issue and sell from time to time, in one or more series, its
Unsecured Debt Securities which are registered under the registration statement
referred to in Section 1(a) (the "Securities"). The Securities will be issued
under an Indenture, dated as of July 15, 1986, between the Company and The Chase
Manhattan Bank, as Trustee, which provides for the issuance of an unlimited
principal amount of Debt Securities of the Company in one or more series. The
Company proposes to sell to the underwriters named in Schedule II hereto (the
"Underwriters") for whom you are acting as Representative or Representatives
(the "Representatives"), Securities in the aggregate principal amount and of the
series identified in Schedule I hereto ("Purchased Securities").
1. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
represents and warrants to, and agrees with the Underwriters that:
(a) A Registration statement (No. 333- ), including a
prospectus, relating to the Securities has been filed with the
Securities and Exchange Commission (the "Commission") and has become
effective. Such registration statement, including the prospectus
therein, as amended and supplemented to the date of this Agreement
(exclusive of the supplements to the prospectus relating solely to
Securities that are not the Purchased Securities) and as supplemented
by the Prospectus Supplement to be included as part of the prospectus
to be filed with the Commission pursuant to Rule 424 (c) under the
Securities Act of 1933 ("Act") as provided in Section 3(a) hereof, are
hereinafter referred to as the "Registration Statement" and such
prospectus is hereinafter referred to as the "Prospectus." Any
reference herein to the Registration Statement or the Prospectus shall
be deemed to include the document incorporated by reference therein
pursuant to Item 12 of Form S-3 which were filed under the Securities
Exchange Act of 1934 ("Exchange Act") on or before the date of this
Agreement; and any reference herein to the terms "amend," "amendment"
or "supplement" with respect to the Registration Statement or the
Prospectus shall be deemed to refer to and include the filing of any
document under the Exchange Act deemed to be incorporated therein by
reference after the date of this Agreement.
(b) The Registration Statement and the Prospectus, both
at the time the Prospectus is filed with the Commission pursuant to
Rule 424(c) under the Act as provided in Section 3(a) hereof, and any
further amendments and supplements to the Prospectus when they become
effective or are filed with the Commission, as the case may be, prior
to the Closing Date, will conform in all respects to the requirements
of the Act, the Trust Indenture Act of 1939 ("Trust Indenture Act") and
the rules
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and regulations of the Commission ("Rules and Regulations"), and none
of such documents will include any untrue statement of a material fact
or omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading, except that
the foregoing does not apply to statements or omissions in such
documents based upon written information furnished to the Company by
any Underwriter specifically for use therein or in reliance upon and in
conformity with the Form T-l of the Trustee.
2. PURCHASE, OFFERING AND DELIVERY. Subject to the terms and
conditions herein set forth, the Company agrees to sell to each Underwriter, and
each Underwriter agrees, severally and not jointly, to purchase from the
Company, at the purchase price set forth in Schedule I hereto, the principal
amount of the Purchased Securities set forth opposite such Underwriter's name in
Schedule II hereto. It is understood that the Underwriters propose to offer the
Purchased Securities for sale to the public as set forth in the Prospectus
Supplement relating to the Purchased Securities.
The Purchased Securities to be purchased by each Underwriter shall be
delivered by the Company for the account of such Underwriter to the place
specified in Schedule I hereto against payment of the purchase price therefor by
such Underwriter or on its behalf by certified or official check or checks in
immediately available funds drawn to the order of the Company, at the location
and at the time and date specified in Schedule I hereto or at such other time
and date as the Representatives and the Company may agree, such time and date
being herein referred to as the "Closing Date." The Purchased Securities so to
be delivered will be in fully registered form in such authorized denominations
and registered in such names as the Representatives request at least four full
business days before the Closing Date and will be made available for checking
and packaging in the city designated in Schedule I as the place of delivery at
least 24 hours prior to the Closing Date.
3. COVENANTS OF THE COMPANY. The Company covenants and agrees
with the Underwriters that:
(a) Promptly following execution of this Agreement, the
Company will cause the Prospectus (including as part thereof a
prospectus supplement relating to the Purchased Securities ("Prospectus
Supplement")) to be filed with the Commission pursuant to Rule 424(c)
under the Act the Company will promptly advise the Representatives when
such filing has been made. Prior to such filing the Company will work
with the Representatives in the preparation of the Prospectus
Supplement to assure that the Representatives have no reasonable
objection to the form or content thereof when filed.
(b) If at any time when a prospectus relating to the
Purchased Securities is required to be delivered under the Act any
event occurs as a result of which the Prospectus as then amended or
supplemented would include an untrue statement of a material fact, or
omit to state any material fact necessary to make the statements
therein, in the light of the circumstances under which they were made,
not misleading, or if it is necessary at any time to amend or
supplement the Registration Statement or Prospectus to comply with the
Act or the Rules and Regulations, the Company promptly will prepare and
file with the Commission an amendment or supplement which will correct
such statement or omission, or an amendment which will effect such
compliance.
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(c) The Company will furnish to each Underwriter such
number of copies of the Prospectus as may be reasonably requested in
connection with the offering of the Purchased Securities.
(d) The Company will pay all expenses incident to the
performance of its obligations under this Agreement, and will reimburse
the Underwriters for any expenses up to $___________ in the aggregate
(including fees and disbursements of counsel) incurred in connection
with qualification of the Purchased Securities for sale and
determination of their eligibility for investment under the laws of
such jurisdictions as the Representatives designate and the printing of
memoranda relating thereto.
4. CONDITIONS TO THE OBLIGATIONS OF THE UNDERWRITERS. The obligation of
the several Underwriters to purchase and pay for the Purchased Securities
hereunder will be subject to the accuracy of the representations and warranties
on the part of the Company herein, to the performance by the Company of its
obligations hereunder and to the following additional conditions precedent:
(a) Subsequent to the execution and delivery of this
Agreement there shall not have occurred any change, or any development
involving a prospective change, in or affecting particularly the
business or properties of the Company or its subsidiaries which, in the
judgment of a majority in interest of the Underwriters, including you,
materially impairs the investment quality of the Purchased Securities.
(b) No stop order suspending the effectiveness of the
Registration Statement shall have been issued and no proceedings for
that purpose shall have been instituted or, to the knowledge of the
Company, or the Underwriters, shall be contemplated by the Commission.
(c) The Underwriters shall have received the following:
(i) A letter of Price Waterhouse, dated the
Closing Date, confirming that they are independent accountants within
the meaning of the Act and the Rules and Regulations, and stating in
effect that (i) in their opinion, the financial statements examined by
them and incorporated by reference in the Prospectus comply as to form
in all material respects with the accounting requirements of the Act
and the Rules and Regulations applicable to annual reports on Form 10-K
(ii) on the basis of a reading of the interim financial statements
referred to in clause (A) below, a reading of the latest available
interim financial statements of the Company, a reading of the minutes
of the Board of Directors and stockholders of the Company as set forth
in the minute books of the Company and inquiries of officials of the
Company responsible for financial and accounting matters, nothing came
to their attention that caused them to believe that (A) the unaudited
financial statements included in the most recent Quarterly Report on
Form 10-Q incorporated by reference in the Prospectus were not prepared
on a basis substantially consistent with that of the audited financial
statements as of and for the fiscal year ended December 31, 199__
incorporated by reference in the Prospectus, or (B) at the date of the
latest available balance sheet read by such accountants or at a
subsequent specified date not more than five days prior to the Closing
Date, there was any change in the capital stock or long term debt of
the Company or, at the date of the latest available balance sheet read
by such accountants, there was any decrease in net assets, in each case
as compared with the corresponding amounts shown in the December
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31, 199__ balance sheet incorporated by reference in the Prospectus, or
(C) for the period of twelve months ended with the closing date of the
latest available income statement read by such accountants there were
any decreases, as compared with the twelve months ended December 31,
199__ in operating revenues, operating income, net income, earnings per
share of common stock or the ratio of earnings to fixed charges, except
in all cases set forth in clauses (B) and (C) above for changes or
decreases which the Prospectus discloses have occurred or may occur, or
which are described in such letter, and (iii) they have compared the
dollar amounts (or percentages derived from such dollar amounts) and
other financial information contained in the Prospectus under the
captions "Summary Information," "Ratio of Earnings to Fixed Charges"
and "Description of Unsecured Debt Securities" and contained in the
Company's Annual Report on Form 10-K for the year ended December 31,
199__ (which is incorporated by reference in the Prospectus) (in each
case to the extent that such dollar amounts, percentages and other
financial information are derived from the general accounting records
of the Company subject to the internal controls of the Company's
accounting system or are derived directly from such records by analysis
or computation) with the results obtained from inquiries, a reading of
such general accounting records and other procedures specified in such
letter, and have found such dollar amounts, percentages and other
financial information to be in agreement with such results, except as
otherwise specified in such letter. All financial statements included
in material incorporated by reference in the Prospectus shall be deemed
included in the Prospectus for purposes of this subsection.
(ii) An opinion of ▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇, counsel
for the Company, dated the Closing Date, to the effect that:
(A) The Company has been duly
incorporated and is validly existing as a corporation in good
standing under the laws of the State of Illinois, with
corporate power and authority to own its properties and
conduct its business as described in the Prospectus; and the
Company is not required to be qualified as a foreign
corporation in any jurisdiction.
(B) The Purchased Securities have been
duly authorized, executed, authenticated, issued and delivered
and constitute the valid and binding obligations of the
Company enforceable in accordance with their terms, and
(subject to the qualifications mentioned in subparagraph (C)
below with respect to the enforceability of the Indenture and
to any variations established for any particular series of
Securities) are entitled to the benefit of the Indenture in
accordance with the terms thereof equally and ratably with all
other securities issued under the Indenture.
(C) The Indenture has been duly
authorized, executed and delivered and is a valid and binding
instrument enforceable in accordance with its terms, except as
the same may be limited by bankruptcy, insolvency,
reorganization or other laws relating to or affecting the
enforcement of creditors' rights generally.
(D) The Registration Statement has
become effective under the Act; the Indenture has been duly
qualified under the Trust Indenture Act; to the best of the
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knowledge of such counsel, no stop order suspending the
effectiveness of the Registration Statement has been issued
and no proceedings for that purpose have been instituted or
are pending or contemplated under the Act, and the
Registration Statement and the Prospectus, and each amendment
or supplement thereto, as of their respective effective or
issue dates, complied as to form in all material respects with
the requirements of the Act, the Trust Indenture Act and the
Rules and Regulations; such counsel have no reason to believe
that either the Registration Statement or the Prospectus, or
any such amendment or supplement, as of such respective dates,
contained any untrue statement of a material fact or omitted
to state any material fact required to be stated therein or
necessary to make the statements therein not misleading; the
descriptions in the Registration Statement and Prospectus of
statutes, legal and governmental proceedings and contracts and
other documents are accurate and fairly present the
information required to be shown; and such counsel do not know
of any legal or governmental proceedings required to be
described in the Prospectus which are not described as
required, nor of any contracts or documents of a character
required to be described in the Registration Statement or
Prospectus or to be filed as Exhibits to the Registration
Statement which are not described and filed as required; it
being understood that such counsel need express no opinion as
to the financial statements or other financial data contained
in Registration Statement or the Prospectus.
(E) This Agreement has been duly
authorized, executed and delivered by the Company.
(F) The Illinois Commerce Commission
has entered an order permitting the issue and sale of the
Purchased Securities; and said order is valid and in effect
and no further approval, authorization, consent or order of,
or action by, any other regulatory authority is necessary with
respect to the execution and delivery of the Indenture or the
issue and sale of the Purchased Securities, as contemplated by
this Agreement, it being understood that in giving such
opinion such counsel are not passing upon the authorizations
or approvals which may be necessary under the securities or
blue sky laws of any jurisdiction. The issue and sale of the
Purchased Securities, as contemplated by this Agreement, is in
conformity with the terms of said order of the Illinois
Commerce Commission.
(G) The statements made in the
Prospectus under the caption "Description of the Unsecured
Debt Securities" insofar as they purport to summarize
provisions of the documents specifically referred to under
said caption, fairly present the information called for with
respect thereto by Form S-3.
(H) The statements in the Prospectus
and in the Company's most recent Annual Report on Form 10- K
(which is incorporated by reference in the Prospectus) as to
matters of law and legal conclusions which are stated n the
Prospectus to have been made on the authority of such counsel
have been reviewed by them and, as to matters of law and legal
conclusions, are correct.
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(iii) An opinion from ___________, counsel for the
Underwriters, as to those matters as the Underwriters may reasonably
require.
(iv) A certificate of the Chairman, President, an
Executive Vice President, a Senior Vice President or a Vice President
and the Treasurer or the principal financial or accounting officer of
the Company, dated the Closing Date, in which such officers, to the
best of their knowledge after reasonable investigation, shall state
that the representations and warranties of the Company in this
Agreement are true and correct, that the Company has complied with all
agreements and satisfied all conditions on its part to be performed or
satisfied at or prior to the Closing Date that no stop order suspending
the effectiveness of the Registration Statement has been issued and no
proceedings for that purpose have been instituted or are contemplated
by the Commission, and that, subsequent to the date of the most recent
financial statements in the Prospectus, there has been no material
adverse change in the financial position or results of operations of
the Company except as set forth or contemplated in the Prospectus or as
described in such certificate.
(v) An order of the Illinois Commerce Commission
authorizing the issuance and sale of the Purchased Securities in
accordance with the terms and conditions hereof shall be in full force
and effect and shall contain no conditions or provision unacceptable to
Underwriters, it being understood that no order in effect as of the
date hereof contains any such unacceptable condition or provision.
The Company will furnish the Underwriters with such conformed copies of such
opinions, certificates, letters and documents as the Underwriters reasonably
request.
5. CONDITIONS OF THE OBLIGATION OF THE COMPANY. The obligation of
the Company to sell and deliver the Purchased Securities on the Closing Date is
subject to the following conditions precedent:
(a) Prior to the Closing Date, no stop order suspending
the effectiveness of the Registration Statement shall have been issued
and no proceedings for that purpose shall have instituted, or, to the
knowledge of the Company or the Underwriters, shall be contemplated by
the Commission.
(b) There shall be in effect on the Closing Date an order
of the Illinois Commerce Commission authorizing the issuance and sale
of the Purchased Securities in accordance with the terms and conditions
thereof, and no order of the Illinois Commerce Commission shall be in
effect at the Closing Date, which would prevent the sale and delivery
of the Purchased Securities or which contains any condition or
provision with respect to such sale which is not acceptable to the
Company, it being understood that no order in effect at the date of
this Agreement contains any such unacceptable condition or provision.
If any such condition shall not have been satisfied, then the Company
shall be entitled, by notice in writing to the Underwriters, to terminate this
Agreement without liability on the part of the Company or any Underwriter,
except as provided herein.
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6. INDEMNIFICATION.
(a) The Company will indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter
within the meaning of the Act against any losses, claims, damages or
liabilities, joint or several, to which such Underwriter or such
controlling person 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 any untrue statement or
alleged untrue statement of any material fact contained in the
Registration Statement, the Prospectus, 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 Underwriter and each such controlling person for any
legal or other expenses reasonably incurred by such Underwriter or such
controlling person in connection with investigating or defending any
such loss, claim, damage, liability or action; provided, however, that
the Company will not be liable in any such case to the extent that any
such loss, claim, damage or liability arises out of or is based upon an
untrue statement or alleged untrue statement or omission or alleged
omission made in any of such documents in reliance upon and in
conformity with written information furnished to the Company by any
Underwriter specifically for use therein or in reliance upon and in
conformity with the Form T-1 of the Trustee. This indemnity agreement
will be in addition to any liability which the Company may otherwise
have.
(b) Each Underwriter will indemnify and hold harmless the
Company, each of its directors and officers and each person, if any,
who controls the Company within the meaning of the Act, against any
losses, claims, damages or liabilities to which the Company or any such
director, officer or controlling person 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 any untrue statement or alleged untrue statement of any material
fact contained in the Registration Statement, the Prospectus or any
amendment or supplement thereto, or arise out of or are based upon the
omission or the 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 reliance upon and in
conformity with written information furnished to the Company by such
Underwriters specifically for use therein; and will reimburse any legal
or other expenses reasonably incurred by the Company or any such
director, officer or controlling person in connection with
investigating or defending any such loss, claim, damage, liability or
action. This indemnity agreement will be in addition to any liability
which such Underwriters may otherwise have.
(c) Promptly after receipt by an indemnified party under
this Section of notice of the commencement of any action, such
indemnified party will, if a claim in respect thereof is to be made
against the indemnifying party under this Section, notify the
indemnifying party of the commencement thereof; but the omission so to
notify the indemnifying party will not relieve it from any liability
which it may have to any indemnified party otherwise than under this
Section. In case any such action is brought against any indemnified
party, and it notifies the indemnifying party of the commencement
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thereof the indemnifying party will 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 will not be liable to such indemnified
party under this Section for any legal or other expenses subsequently
incurred by such indemnified party in connection with the defense
thereof other than reasonable costs of investigation.
(d) If recovery is not available under the foregoing
indemnification provisions of this Section, for any reason other than
as specified therein, the parties entitled to indemnification by the
terms thereof shall be entitled to contribution for liabilities and
expenses, except to the extent that contribution is not permitted under
Section 11(f) of the Act. In determining the amount of contribution to
which the respective parties are entitled, there shall be considered
the relative benefits received by each party from the offering of the
Purchased Securities (taking into account the portion of the proceeds
of the offering realized by each) , the parties' relative knowledge and
access to information concerning the matter with respect to which the
claim was asserted, the opportunity to correct and prevent any
statement or omission, and any other equitable considerations
appropriate under the circumstances. The Company and the Underwriters
agree that it would not be equitable if the amount of such contribution
were determined by pro rata or per capita allocation. The Underwriters
or person controlling such Underwriters shall not be obligated to make
contribution hereunder which in the aggregate exceeds the total public
offering price of the Purchased Securities less the aggregate amount of
any damages which the Underwriters and their controlling persons have
otherwise been required to pay in respect of the same claim or any
substantially similar claim.
7. DEFAULT OF UNDERWRITERS. If any Underwriter or Underwriters
default in their obligations to purchase the Purchased Securities hereunder on
the Closing Date and the aggregate principal amount of Purchased Securities
which such defaulting Underwriter or Underwriters agreed but failed to purchase
does not exceed 10% of the aggregate principal amount of the Purchased
Securities which the Underwriters are obligated to purchase on the Closing Date,
you may make arrangements satisfactory to the Company for the purchase of such
Purchased Securities by other persons, including any of the Underwriters, but if
no such arrangements are made by the Closing Date the non-defaulting
Underwriters shall be obligated severally, in proportion to their respective
commitments hereunder, to purchase the Purchased Securities which such
defaulting Underwriters agreed but failed to purchase on the Closing Date. If
any Underwriter or Underwriters so default and the aggregate principal amount of
the Purchased Securities with respect to which such default or defaults occur is
more than the above percentage and arrangements satisfactory to you and the
Company for the purchase of such Purchased Securities by other persons are not
made within thirty-six hours after such default, this Agreement will terminate
without liability on the part of any non-defaulting Underwriter or the Company,
except as provided in Section 8. In the event that any Underwriter or
Underwriters default in their obligations to purchase the Purchased Securities
hereunder, the Company may, by prompt written notice to you, postpone the
Closing Date for a period of not more than seven full business days in order to
effect whatever changes may thereby be made necessary in the Registration
Statement or the Prospectus or the Registration Statement or
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supplements to the Prospectus which may thereby be made necessary. As used in
this Agreement, the term "Underwriter" includes any person substituted for an
Underwriter under this Section. Nothing herein will relieve a defaulting
Underwriter from liability for its default.
8. SURVIVAL OF REPRESENTATIONS, WARRANTIES, ETC. The respective
representations, warranties, agreements and indemnities of the Company and the
Underwriters set forth in or made pursuant to this Agreement will remain in full
force and effect, regardless of any investigation, or statement as to the
results thereof, made by or on behalf of the Underwriters or the Company or any
of their officers or directors or any controlling person, and will survive
delivery of any payment for the Purchased Securities.
9. NOTICE. All communications hereunder shall be in writing and
if sent to the Company will be mailed, delivered or transmitted via facsimile
and confirmed to it at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ and if
sent to any of the Underwriters will be mailed, delivered or transmitted via
facsimile and confirmed to such addresses as the Representatives of the
Underwriters shall advise the Company in writing.
10. SUCCESSORS. This Underwriting 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 6, and no other person will have any right or obligation hereunder.
11. COUNTERPARTS. This Agreement may be executed in counterparts
all of which, taken together, shall constitute a single agreement among the
parties to such counterparts.
12. REPRESENTATION OF THE UNDERWRITERS. The Representatives
represent and warrant to the Company that they are authorized to act as the
representatives of the Underwriters in connection with this financing, and the
Representatives' execution and delivery of this Agreement and any action under
this Agreement taken by such Representatives will be binding upon all
Underwriters.
13. INTERPRETATION WHEN NO REPRESENTATIVES. In the event no
Underwriters are named in Schedule II hereto, the term "Underwriters" shall be
deemed for all purposes of this Agreement to be the Underwriter or Underwriters
named as such in Schedule I hereto, the principal amount of the Purchased
Securities to be purchased by any such Underwriter shall be that set forth
opposite its name in Schedule I hereto and all reference to the
"Representatives" shall be deemed to be the Underwriter or Underwriters named in
Schedule I.
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If the foregoing is in accordance with your understanding of our
agreement, kindly sign and return to us the enclosed duplicate hereof, whereupon
it will become a binding agreement between the Company and the Underwriters in
accordance with its terms.
Very truly yours,
Illinois Power Company
By___________________________
Its________________________
Accepted as of the date of this
Underwriting Agreement set forth
in Schedule I hereto.
__________________________________,
as Representatives
By________________________________
Its_____________________________
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SCHEDULE I
[Representatives of the] Underwriters and addresses [and any Principal Amount of
Purchased Securities if no Underwriters named in Schedule II].
Purchase Price and Description of Purchased Securities:
Aggregate Principal Amount: $_______
Purchase price:_______% of the Principal Amount
Interest Rate:_______%
Initial Public Offering Price:_______%
Dealer Discount:_______%
Reallowance to Dealers:_______%
Maturity:_______
Sinking Fund Provisions:_______
Redemption Provisions:_______
Other Provisions:_______
Time and Date of Delivery and Payment ("Closing Date"):
Date:_______
Time:_______
Place of delivery of payment:_______
Type of Funds:_______
Method of payment:_______
Place of delivery of Purchased Securities:_______
Underwriting Agreement Dated:_______
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SCHEDULE II
Principal
Amount of
Purchased
Underwriter Securities
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