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As Filed with the Securities and
Exchange Commission on December 16,1997 File No. 70-9095
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------------------------
AMENDMENT NO.2 TO
APPLICATION-DECLARATION
ON FORM U-1
UNDER
THE PUBLIC UTILITY HOLDING COMPANY ACT OF 1935
------------------------------------------
CONECTIV, INC.
DELMARVA POWER & LIGHT COMPANY
SUPPORT CONECTIV, INC.(1, 2)
DELMARVA INDUSTRIES, INC.
DELMARVA ENERGY CO.
800 King Street
Wilmington, DE 19899
DELMARVA CAPITAL INVESTMENTS, INC. ATLANTIC CITY ELECTRIC COMPANY
CONECTIV SERVICES, INC. DEEPWATER OPERATING COMPANY
CONECTIV COMMUNICATIONS, INC. ATLANTIC ENERGY ENTERPRISES, INC.
DELMARVA SERVICES COMPANY ATLANTIC ENERGY INTERNATIONAL, INC.
DCI I, INC. 6801 Black Horse Pike
DCI II, INC. Egg Harbor Township, NJ 08234
DELMARVA CAPITAL TECHNOLOGY CO.
DCTC-BURNEY, INC. ATLANTIC GENERATION, INC.
DELMARVA CAPITAL REALTY COMPANY ATLANTIC SOUTHERN PROPERTIES, INC.
CHRISTIANA CAPITAL MANAGEMENT, INC. ATE INVESTMENT, INC.
POST AND RAIL FARMS, INC. ATLANTIC THERMAL SYSTEMS, INC.
DELMARVA OPERATING SERVICES CO. COASTALCOMM, INC.
DELSTAR OPERATING COMPANY ATLANTIC ENERGY TECHNOLOGY, INC.
DELWEST OPERATING COMPANY BINGHAMTON GENERAL, INC.
DELCAL OPERATING COMPANY BINGHAMTON LIMITED, INC.
CONECTIV SOLUTIONS, INC. PEDRICK LIMITED, INC.
CONECTIV ENTERPRISES, INC.(1) PEDRICK GENERAL, INC.
CONECTIV ENERGY, INC.(1) VINELAND LIMITED, INC.
252 Chapman Road VINELAND GENERAL, INC.
P.O. Box 6066 ATLANTIC JERSEY THERMAL SYSTEMS, INC.
Newark, DE 19714 ATS OPERATING SERVICES, INC.
THE EARTH EXCHANGE, INC.
ATLANTIC PAXTON COGENERATION, INC.
5100 Harding Highway
Mays Landing, NJ 08330
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(Names of companies filing this statement and addresses of principal
executive offices)
CONECTIV, INC.
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(Name of top registered holding company parent)
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Barbara S. Graham Michael J. Barron
President Vice President
Conectiv, Inc. Conectiv, Inc.
800 King Street 6801 Black Horse Pike
Wilmington, Delaware 19899 Egg Harbor Township, NJ 08234
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(Names and addresses of agents for service)
The Commission is requested to send copies of all notices, orders and
communications in connection with this Application-Declaration to:
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Dale G. Stoodley, Esq. James E. Franklin II, Esq. Joyce Koria Hayes, Esq.
Delmarva Power & Light Company Atlantic Energy, Inc. 7 Graham Court
800 King Street 6801 Black Horse Pike Newark, DE 19711
Wilmington, DE 19899 Egg Harbor Township, NJ 08234
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(1) Companies to formed prior to Merger
(2) To be renamed Conectiv Resource Partners, Inc.
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The Application-Declaration as previously filed is hereby amended as follows:
ITEM 2. FEES, COMMISSIONS AND EXPENSES
(a) State (1) the fees, commissions and expenses paid or incurred, or to be
paid or incurred, directly or indirectly, in connection with the proposed
transaction by the applicant or declarant or any associate company thereof, and
(2) if the proposed transaction involves the sale of securities at competitive
bidding, the fees and expenses to be paid to counsel selected by applicant or
declarant to act for the successful bidder.
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Estimated Legal Fees and Expenses $20,000
Estimated Miscellaneous Expenses 10,000
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Total $30,000
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*The above fees do not include the expenses for the public issuance of
long-term debt and equity securities. As noted previously, Conectiv proposes
that such fees be capped at 5% of the issuance amount.
ITEM 6. EXHIBITS
(a) Exhibits
A-1 Restated Certificate of Incorporation of Conectiv (previously filed)
A-2 Form of Conectiv Indenture including Form of Debenture and Form of
Medium - Term Note (filed herewith)
A-3 Forms of Conectiv Common Stock Certificates (filed herewith)
A-4 Form of Conectiv Commercial Paper Note (previously filed)
A-5 Form of Bid Note Agreement (filed herewith)
A-6 Form of System Money Pool Evidence of Deposit (previously filed)
A-7 Form of System Money Pool Short-Term Grid Note (previously filed)
A-8 Draft Investment Guidelines (previously filed)
A-9 Form of Money Pool Agreement (filed herewith)
B-1 Form of Standard Conectiv Underwriting Agreement (Common Stock) (filed
herewith)
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B-2 Form of Standard Conectiv Underwriting Agreement (Debt) (filed
herewith)
B-3 Form of Standard Conectiv Master Distribution Agreement (Medium-Term
Notes) (filed herewith)
B-4 Summary of Terms of Conectiv Incentive Compensation Plan (incorporated
by reference to the filing on Form S-4 (File No. 333-18843) dated
December 26, 1996
B-5 Conectiv Dividend Reinvestment Plan (to be filed by amendment via
incorporation by reference)
F-1 Opinion of Counsel (to be filed by amendment)
H-1 Proposed Notice (previously filed)
H-2 Financial Data Schedules (previously filed)
I-1 Summary of existing financing arrangements for Delmarva and
subsidiaries (previously filed).
I-2 Summary of existing financing arrangements for Atlantic and
subsidiaries (previously filed).
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SIGNATURE
Pursuant to the requirements of the Public Utility Holding Company Act
of 1935, the undersigned companies have duly caused this Amendment No. 2 to
Form U-1 to be signed on their behalf by the undersigned thereunto duly
authorized.
The signatures of the applicants and of the persons signing on their
behalf are restricted to the information contained in this application which is
pertinent to the application of the respective companies.
DATE: CONECTIV, INC.
December 16, 1997 /s/ B.S. Graham
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President
DELMARVA POWER & LIGHT COMPANY
DELMARVA INDUSTRIES, INC.
DELMARVA ENERGY COMPANY
DELMARVA CAPITAL INVESTMENTS, INC.
CONECTIV SERVICES, INC.
DCI I, INC.
DCI II, INC.
DELMARVA CAPITAL TECHNOLOGY COMPANY
DCTC-BURNEY, INC.
DELMARVA CAPITAL MANAGEMENT, INC.
POST AND RAIL FORMS, INC.
DELMARVA OPERATING SERVICES COMPANY
DELSTAR OPERATING COMPANY
DELWEST OPERATING COMPANY
DELCAL OPERATING COMPANY
December 16, 1997 /s/ D. P. Connelly
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Secretary
CONECTIV SOLUTIONS, INC.
December 16, 1997 /s/ H. E. Cosgrove
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Chairman and Chief Executive Officer
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ATLANTIC CITY ELECTRIC COMPANY
December 16, 1997 /s/ L. M. Walters
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Vice President, Treasurer
& Assistant Secretary
DEEPWATER OPERATING COMPANY
December 16, 1997 /s/ L. M. Walters
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Treasurer
ATLANTIC ENERGY ENTERPRISES, INC.
December 16, 1997 /s/ F. E. DiCola
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Senior Vice President and Treasurer
ATLANTIC ENERGY INTERNATIONAL, INC.
December 16, 1997 /s/ J. E. Franklin II
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Secretary
ATLANTIC GENERATION, INC.
December 16, 1997 /s/ F. E. DiCola
- ----------------- ------------------------------------
Treasurer and Secretary
ATLANTIC SOUTHERN PROPERTIES, INC.
December 16, 1997 /s/ F. E. DiCola
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Vice President and Treasurer
ATE INVESTMENT, INC.
December 16, 1997 /s/ F.E. DiCola
- ----------------- ----------------------------------
Vice President and Treasurer
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ATLANTIC THERMAL SYSTEMS, INC.
December 16, 1997 /s/ F. E. DiCola
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President and Chief Executive Officer
COASTAL COMM, INC.
December 16, 1997 /s/ R. L. Aveyard
- ----------------- -------------------------------------
President and Treasurer
ATLANTIC ENERGY TECHNOLOGY, INC.
December 16, 1997 /s/ F. E. DiCola
- ----------------- -------------------------------------
Treasurer
BINGHAMTON GENERAL, INC.
BINGHAMTON LIMITED, INC.
PEDRICK LIMITED, INC.
PEDRICK GENERAL, INC.
VINELAND LIMITED, INC.
VINELAND GENERAL, INC.
December 16, 1997 /s/ F. E. DiCola
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Vice President
ATLANTIC JERSEY THERMAL SYSTEMS, INC.
December 16, 1997 /s/ F. E. DiCola
- ----------------- -------------------------------------
President
ATS OPERATING SERVICES, INC.
December 16, 1997 /s/ F. E. DiCola
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President
THE EARTH EXCHANGE, INC.
December 16, 1997 /s/ F. E. DiCola
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President
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ATLANTIC PAXTON COGENERATION, INC.
December 16, 1997 /s/ F. E. DiCola
- ----------------- -------------------------------------
President
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EXHIBIT INDEX
A-2 Form of Conectiv Indenture including Form of Debenture and Form of
Medium-Term Note
A-3 Forms of Conectiv Stock Certificates
A-5 Form of Bid Note
A-9 Form of Money Pool Agreement
B-1 Form of Standard Conectiv Underwriting Agreement (Common Stock)
B-2 Form of Standard Conectiv Underwriting Agreement (Debt)
B-3 Form of Standard Conectiv Master Distribution Agreement (Medium-Term
Notes)
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EXHIBIT A-2
CONECTIV
Senior Debt Securities
INDENTURE
Dated as of _________, 19__
Trustee
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CROSS-REFERENCE TABLE
CONECTIV AND ___________, TRUSTEE
INDENTURE DATED ___________, 199_
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TIA Section Indenture Section
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310 (a)(1)...............................................................................6.10
(a)(2)...............................................................................6.10
(a)(3)...............................................................................N.A.
(a)(4)...............................................................................N.A.
(b).....................................................................6.08, 6.10, 12.02
(c)..................................................................................N.A.
311 (a)..................................................................................6.11
(b)..................................................................................6.11
(c)..................................................................................N.A.
312 (a)..................................................................................2.07
(b).................................................................................12.03
(c).................................................................................12.03
313 (a)..................................................................................6.06
(b)..................................................................................6.06
(c)...........................................................................6.06, 12.02
(d)..................................................................................6.06
314 (a).....................................................................3.02, 3.03, 12.02
(b)...................................................................................N.A
(c)(1)..............................................................................12.05
(c)(2)........................................................................6.02, 12.05
(c)(3)...............................................................................N.A.
(d)..................................................................................N.A.
(e).................................................................................12.06
(f)..................................................................................N.A.
315 (a)...............................................................................6.01(b)
(b)...........................................................................6.05, 12.02
(c)...............................................................................6.01(a)
(d)...............................................................................6.01(c)
(e)..................................................................................5.11
316 (a)(1)(A)............................................................................5.05
(a)(1)(B)............................................................................5.04
(a)(2)...............................................................................N.A.
(b)..................................................................................5.07
317 (a)(1)...............................................................................5.08
(a)(2)...............................................................................5.09
(b)..................................................................................2.06
318 (a).................................................................................12.01
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TABLE OF CONTENTS
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RECITALS.....................................................................................1
ARTICLE 1
Definitions and Incorporation by Reference
SECTION 1.01. Definitions...........................................................1
SECTION 1.02. Other Definitions.....................................................4
SECTION 1.03. Incorporation by Reference of Trust Indenture Act.....................4
SECTION 1.04. Rules of Construction.................................................4
ARTICLE 2
The Securities
SECTION 2.01. Amount; Issuable in Series............................................5
SECTION 2.02. Denominations.........................................................7
SECTION 2.03. Execution, Authentication and Delivery................................8
SECTION 2.04. Temporary Securities..................................................9
SECTION 2.05. Registrar and Paying Agent...........................................10
SECTION 2.06. Paying Agent to Hold Money in Trust..................................10
SECTION 2.07. Securityholder Lists.................................................11
SECTION 2.08. Transfer and Exchange................................................11
SECTION 2.09. Replacement Securities...............................................12
SECTION 2.10. Outstanding Securities...............................................12
SECTION 2.11. Cancellation.........................................................13
SECTION 2.12. Default Interest.....................................................13
SECTION 2.13. Computation of Interest..............................................13
ARTICLE 3
Covenants
SECTION 3.01. Payment of Securities................................................14
SECTION 3.02. SEC Reports..........................................................14
SECTION 3.03. Compliance Certificate...............................................14
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TABLE OF CONTENTS
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ARTICLE 4
Successor Company
SECTION 4.01. When Company May Merge or Transfer Assets............................14
SECTION 4.02. Successor Entity Substituted.........................................15
ARTICLE 5
Defaults and Remedies
SECTION 5.01. Events of Default....................................................15
SECTION 5.02. Acceleration.........................................................16
SECTION 5.03. Other Remedies.......................................................17
SECTION 5.04. Waiver of Past Defaults..............................................17
SECTION 5.05. Control by Majority..................................................17
SECTION 5.06. Limitation on Suits..................................................18
SECTION 5.07. Rights of Holders To Receive Payment.................................18
SECTION 5.08. Collection Suit by Trustee...........................................18
SECTION 5.09. Trustee May File Proofs of Claim.....................................18
SECTION 5.10. Priorities...........................................................19
SECTION 5.11. Undertaking for Costs................................................19
SECTION 5.12. Waiver of Stay or Extension Laws.....................................20
ARTICLE 6
Trustee
SECTION 6.01. Duties of Trustee....................................................20
SECTION 6.02. Rights of Trustee....................................................21
SECTION 6.03. Individual Rights of Trustee.........................................22
SECTION 6.04. Trustee's Disclaimer.................................................22
SECTION 6.05. Notice of Defaults...................................................22
SECTION 6.06. Reports by Trustee to Holders........................................22
SECTION 6.07. Compensation and Indemnity...........................................22
SECTION 6.08. Replacement of Trustee...............................................23
SECTION 6.09. Successor Trustee by Merger..........................................24
SECTION 6.10. Eligibility; Disqualification........................................24
SECTION 6.11. Preferential Collection of Claims Against Company....................25
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ARTICLE 7
Discharge of Securities and Indenture
SECTION 7.01. Satisfaction and Discharge of Securities.............................25
SECTION 7.02. Satisfaction and Discharge of Indenture..............................27
SECTION 7.03. Application of Trust Money...........................................28
ARTICLE 8
Amendments
SECTION 8.01. Without Consent of Holders...........................................29
SECTION 8.02. With Consent of Holders..............................................30
SECTION 8.03. Compliance with Trust Indenture Act..................................31
SECTION 8.04. Revocation and Effect of Consent and Waivers.........................31
SECTION 8.05. Notation on or Exchange of Securities................................31
SECTION 8.06. Trustee To Sign Amendments...........................................31
ARTICLE 9
Redemption
SECTION 9.01. Applicability........................................................32
SECTION 9.02. Notice to Trustee....................................................32
SECTION 9.03. Selection of Securities To Be Redeemed...............................32
SECTION 9.04. Notice of Redemption.................................................33
SECTION 9.05. Effect of Notice of Redemption.......................................33
SECTION 9.06. Deposit of Redemption Price..........................................34
SECTION 9.07. Securities Redeemed in Part..........................................34
ARTICLE 10
Sinking Funds
SECTION 10.01. Applicability.......................................................34
SECTION 10.02. Satisfaction of Sinking Fund Payment with Securities................34
SECTION 10.03. Redemption of Securities for Sinking Fund...........................35
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ARTICLE 11
Meetings of Holders; Actions without Meeting
SECTION 11.01. Purposes for Which Meetings May Be Called...........................36
SECTION 11.02. Call, Notice and Place of Meetings..................................36
SECTION 11.03. Persons Entitled to Vote at Meetings................................37
SECTION 11.04. Quorum; Action......................................................37
SECTION 11.05. Attendance at Meeting; Determination of Voting Rights;
Conduct and Adjournment of Meetings.................................38
SECTION 11.06. Counting Votes and Recording Action of Meetings.....................39
SECTION 11.07. Action without Meeting..............................................39
ARTICLE 12
Miscellaneous
SECTION 12.01. Trust Indenture Act Controls........................................40
SECTION 12.02. Notices.............................................................40
SECTION 12.03. Communication by Holders with Other Holders.........................40
SECTION 12.04 Acts of Holders.....................................................41
SECTION 12.05. Certificate and Opinion as to Conditions Precedent..................42
SECTION 12.06. Statements Required in Certificate or Opinion.......................43
SECTION 12.07. When Securities Disregarded.........................................43
SECTION 12.08. Rules by Trustee, Paying Agent and Registrar........................43
SECTION 12.09. Legal Holidays......................................................44
SECTION 12.10. Governing Law.......................................................44
SECTION 12.11. No Recourse Against Others..........................................44
SECTION 12.12. Successors..........................................................44
SECTION 12.13. Multiple Originals..................................................44
SECTION 12.14. Table of Contents; Headings.........................................44
TESTIMONIUM.................................................................................45
EXECUTION...................................................................................45
ACKNOWLEDGMENTS.............................................................................46
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THIS INDENTURE dated _____________________________ between Conectiv, a
corporation duly organized and existing under the laws of the State of Delaware
(hereinafter called the "Company"), having its principal office at 800 King
Street, Wilmington, Delaware 19899, and __________, a _____________________
organized and existing under the laws of ___________________ (hereinafter called
the "Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of unsecured debentures,
notes or other evidences of indebtedness (herein called the "Securities"), to be
issued in one or more series as contemplated herein.
All things necessary to make this Indenture a valid agreement of the
Company in accordance with its terms have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the
Securities by the holders thereof, it is mutually covenanted and agreed, for the
equal and proportionate benefit of all holders of the Securities as follows:
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions
"Affiliate" of any specified person means any other person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified person. For the purposes of this definition,
"control" when used with respect to any specified person means the power to
direct the management and policies of such person directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Board of Directors" means the Board of Directors of the Company or any
committee thereof duly authorized to act on behalf of such Board of Directors in
respect of matters related to this Indenture.
"Board Resolution" means a resolution duly adopted by the Board of
Directors, a copy of which shall be certified by the Secretary or an Assistant
Secretary as being in full force and effect on the date of such certification
and delivered to the Trustee.
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"Business Day" means, unless otherwise specified pursuant to Section
2.01, each day which is not a Legal Holiday.
"Bylaws" means the bylaws of the Company as amended from time to time.
"Company" means Conectiv, a Delaware corporation, unless and until a
successor replaces it pursuant to Article 4 and, thereafter, means the successor
(or any subsequent successor pursuant to said Article) and, for purposes of any
provision contained herein and required by the TIA, each other Obligor on the
Securities.
"Company Request", "Request of the Company", "Company Order" or "Order
of the Company" means a written request or order signed in the name of the
Company by an Officer and delivered to the Trustee.
"Default" means any event which is, or after notice or passage of time
or both would be, an Event of Default as more fully described in Section 5.01 of
this Indenture.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Holder" or "Securityholder" means the person in whose name a Security
is registered on the Registrar's books.
"Indenture" means this Indenture, as originally executed and delivered
and as it may from time to time be amended or supplemented by one or more
indentures or other instruments supplemental hereto entered into pursuant to the
applicable provisions hereof and shall include the terms of a particular series
of Securities established as contemplated by Section 2.01.
"Interest Payment Date" means the date specified in the Securities as
the fixed date on which interest is due and payable.
"Officer" means the Chairman of the Board, the President, any Vice
President, the Treasurer, the Secretary, the Controller, any Assistant
Treasurer, any Assistant Secretary, any Assistant Controller, or any officers of
the Company designated by Board Resolution or the Bylaws.
"Officer's Certificate" means a certificate signed by an Officer.
"Opinion of Counsel" means a written opinion from legal counsel, who may
be an employee of or counsel to the Company (or any Subsidiary or Affiliate) or
other counsel acceptable to the Trustee.
"Original Issue Discount Security" means any Security which provides for
an amount less than the principal amount thereof to be due and payable upon a
declaration of acceleration of the maturity thereof pursuant to Section 5.02.
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"Principal Amount" of a Security means the principal amount of the
Security plus the premium, if applicable, payable on the Security which is due
or overdue or is to become due at the relevant time.
"SEC" means the Securities and Exchange Commission, as from time to time
constituted, created under the Securities Exchange Act of 1934, as amended, or,
if at any time after the date of the execution and delivery of this Indenture
such Commission is not existing and performing the duties now assigned to it
under the TIA, then the body, if any, performing such duties at such time.
"Securities" means the Securities issued under this Indenture.
"Subsidiary" means a corporation or limited liability company of which a
majority of the capital stock, having voting power under ordinary circumstances
to elect directors, is owned by the Company and/or one or more Subsidiaries.
"Terms" means the maturity date, interest rate or method of determining
the interest rate, interest payment dates, redemption provisions (optional or
mandatory) and any other terms of any Securities established pursuant to
Sections 2.01 and 2.03.
"TIA" means, as of any time, the Trust Indenture Act of 1939, or any
successor statute, as in effect at such time.
"Trustee" means the party named as such in this Indenture until a
successor replaces it and, thereafter, means the successor.
"Trust Officer" means any officer of the Trustee assigned by the Trustee
to administer its corporate trust matters.
"U.S. Government Obligations" means (a) direct obligations of, or
obligations the principal of and interest on which are unconditionally
guaranteed by, the United States entitled to the benefit of the full faith and
credit thereof; and (b) certificates, depositary receipts or other instruments
which evidence a direct ownership interest in obligations described in clause
(a) above or in any specific interest or principal payments due in the respect
thereof; provided, however, that the custodian of such obligations or specific
interest or principal payments shall be a bank or trust company (which may
include the Trustee or any Paying Agent) subject to federal or state supervision
or examination with a combined capital and surplus of at least $50,000,000; and
provided, further, that except as may be otherwise required by law, such
custodian shall be obligated to pay to the holders of such certificates,
depositary receipts or other instruments the full amount received by such
custodian in respect of such obligations or specific payment and shall not be
permitted to make any deduction therefrom.
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SECTION 1.02. Other Definitions
Defined in Term..........................................................Section
- --------------- -------
"Act"......................................................................12.04
"Bankruptcy Law"............................................................5.01
"Custodian".................................................................5.01
"Event of Default"..........................................................5.01
"Legal Holiday"............................................................12.09
"Mandatory Sinking Fund Payment"...........................................10.01
"Notice of Default".........................................................5.01
"Optional Sinking Fund Payment"............................................10.01
"Paying Agent"..............................................................2.05
"Registrar".................................................................2.05
SECTION 1.03. Incorporation by Reference of Trust Indenture Act
Whenever this Indenture refers to a provision of the TIA or a provision
of the TIA provides that an indenture to be qualified thereunder shall be deemed
to include such provision, the provision is incorporated by reference in and
made a part of this Indenture. The following TIA terms used in this Indenture
have the following meanings as if fully set forth herein and in any supplement
hereto:
"Commission" means the SEC.
"Obligor" on the Securities means the Company and any other obligor on
the Securities.
All other TIA terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by Commission rule have
the meanings assigned to them by such definitions.
SECTION 1.04. Rules of Construction
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning assigned to it
in accordance with generally accepted accounting principles as in effect
from time to time;
(3) "including" means including, without limitation;
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(4) "person" means any individual, corporation, partnership, limited
liability partnership, limited liability company, joint venture,
association, joint-stock company, trust, unincorporated organization,
government or any agency or political subdivision thereof or any other
entity.
(5) "or" is not exclusive;
(6) words in the singular include the plural and words in the plural include
the singular; and
(7) the principal amount of any non-interest bearing or other discount
security at any date shall be the principal amount thereof that would be
shown on a balance sheet of the issuer dated such date prepared in
accordance with generally accepted accounting principles and accretion
of principal on such security shall not be deemed to be the issuance of
Debt.
ARTICLE 2
THE SECURITIES
SECTION 2.01. Amount; Issuable in Series
The aggregate Principal Amount of Securities which may be authenticated
and delivered under this Indenture is unlimited.
The Securities may be issued in one or more series and Securities of the
same series may have different Terms. There shall be established in a Board
Resolution or a supplemental indenture or in an Officer's Certificate pursuant
to a Board Resolution or supplemental indenture, prior to the issuance of
Securities of any series, except as contemplated by the fourth paragraph of
Section 2.03:
(1) the title of the Securities of the series (which shall distinguish the
Securities of the series from all Securities of other series);
(2) any limit upon the aggregate Principal Amount of the Securities of the
series which may be authenticated and delivered under this Indenture
(except for Securities authenticated and delivered upon registration
of transfer of, or in exchange for, or in lieu of, other Securities of
the series pursuant to Sections 2.04, 2.08, 2.09, 8.05 and 9.07);
(3) the date or dates on which the principal and premium, if applicable,
of any of the Securities of the series are payable or the method of
determination thereof;
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(4) the rate or rates, or the method of determination thereof, at which
any of the Securities of the series shall bear interest, if any, the
date or dates from which such interest shall accrue, the Interest
Payment Dates on which such interest shall be payable and the regular
record date for the interest payable on any Interest Payment Date;
(5) the place or places where the principal of and interest, if any, on
any of the Securities of the series shall be payable and the office or
agency for the Securities of the series maintained by the Company
pursuant to Section 2.05;
(6) the period or periods within which, the price or prices at which and
the terms and conditions upon which any of the Securities of the
series may be redeemed, in whole or in part, at the option of the
Company;
(7) the terms of any sinking fund and the obligation, if any, of the
Company to redeem or purchase Securities of the series pursuant to any
sinking fund or analogous provisions or at the option of a Holder
thereof and the period or periods within which, the price or prices at
which and the terms and conditions upon which Securities of the series
shall be redeemed or purchased, in whole or in part;
(8) if other than denominations authorized by Section 2.02, the
denominations in which the Securities of the series shall be issuable;
(9) if other than the Principal Amount thereof, the portion of the
Principal Amount of any of the Securities of the series which shall be
payable upon declaration of acceleration of the maturity thereof
pursuant to Section 5.02;
(10) any deletions or modifications of or additions to the Events of
Default set forth in Section 5.01 or covenants of the Company set
forth in Article 3 pertaining to the Securities of the series;
(11) the currency or currencies, including composite currencies, in which
payment of the principal of and premium, if any, and interest, if any,
on the Securities of such series shall be payable (if other than in
U.S. dollars);
(12) the forms of the Securities of the series;
(13) any exceptions to Section 12.09 or variation in the definition of
Business Day, with respect to the Securities of such series;
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(14) whether the Securities of the series shall be issued in whole or in
part in the form of one or more global Securities and, in such case,
(i) the depository for such global Security or Securities, (ii) any
limitations on the rights of the Holder or Holders of such Securities
to transfer or exchange the same or to obtain the registration of
transfer thereof, (iii) any limitations on the rights of the Holder or
Holders thereof to obtain certificates therefor in definitive form in
lieu of temporary form and (iv) any and all other matters incidental
to such Securities;
(15) if Securities of the series are to be convertible into other
securities, the Terms of such conversion; and
(16) any other Terms of any of the Securities of the series.
All Securities of any one series shall be substantially identical except
as to denomination and except as may otherwise be provided in or pursuant to the
Board Resolution referred to above, or the Company Order contemplated by the
fourth paragraph of Section 2.03, and set forth in the Officer's Certificate
referred to above or in any such indenture supplemental hereto.
At the option of the Company, interest on any series that bears interest
may be paid by mailing a check to the address of, or making a wire transfer to
the account of, any Holder as such address shall appear in the register
maintained pursuant to Section 2.05.
The Securities may have notations, legends or endorsements required by
law, stock exchange rule, agreements to which the Company is subject, if any, or
usage (provided that any such notation, legend or endorsement is in a form
acceptable to the Company).
If any of the Terms of the series are established by action taken
pursuant to a Board Resolution, except as to those contemplated by the fourth
paragraph of Section 2.03, a copy of an appropriate record of such action
together with such Board Resolution shall be certified by the Secretary or an
Assistant Secretary of the Company and delivered to the Trustee at or prior to
the delivery of the Officer's Certificate setting forth the Terms of the series.
SECTION 2.02. Denominations
The Securities of each series shall be issuable in such denominations as
shall be specified as contemplated by Section 2.01. In the absence of any such
provisions with respect to the Securities of any series, the Securities of such
series shall be issuable in denominations of $1,000 and in any integral multiple
thereof. Securities of each series shall be numbered, lettered or otherwise
distinguished in such manner in accordance with such plan as the Officers of the
Company executing the same may determine with the approval of the Trustee.
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SECTION 2.03. Execution, Authentication and Delivery
One Officer shall sign the Securities for the Company by manual or
facsimile signature. The Company's seal shall be impressed, affixed, imprinted
or reproduced on the Securities and may be in facsimile form.
If an Officer whose signature is on a Security no longer holds that
office at the time the Trustee authenticates the Security, the Security shall be
valid nevertheless.
A Security shall not be valid until an authorized signatory of the
Trustee manually signs the certificate of authentication on the Security. The
signature shall be conclusive evidence that the Security has been authenticated
under this Indenture.
At any time after the execution and delivery of this Indenture, the
Company may execute and deliver to the Trustee Securities of any series,
together with a Company Order for the authentication and delivery of such
Securities, and the Trustee in accordance with the Company Order shall
authenticate and deliver such Securities; provided that, if all Securities of a
series are not to be originally issued at one time, the Trustee shall
authenticate and deliver Securities of such series for original issue from time
to time in the aggregate Principal Amount established for such series pursuant
to such procedures acceptable to the Trustee as may be specified from time to
time by Company Order. The maturity date, original issuance date, interest rate
and any other Terms of the Securities of such series shall be determined by or
pursuant to such Company Order and procedures. If provided for in such
procedures, such Company Order may authorize authentication and delivery
pursuant to oral or electronic instructions from the Company or its duly
authorized agents, which instructions, if given orally, shall be promptly
confirmed in writing.
If the forms or Terms of the Securities of the series have been
established by or pursuant to one or more Board Resolutions as permitted by
Section 2.01, in authenticating such Securities, and accepting the additional
responsibilities under this Indenture in relation to such Securities, the
Trustee shall be entitled to receive, and (subject to Section 6.01) shall be
fully protected in relying upon, an Opinion of Counsel stating:
(a) that such forms and/or Terms have been established in conformity with
the provisions of this Indenture; and
(b) that such Securities, when authenticated and delivered by the Trustee
and issued by the Company in the manner and subject to any conditions
specified in such Opinion of Counsel, will constitute valid and legally
binding obligations of the Company, entitled to the benefits of the
Indenture and enforceable against the Company in accordance with their
terms, subject to such exceptions as counsel may specify.
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If such forms or Terms have been so established, the Trustee shall not
be required to authenticate such Securities if the issue of such Securities
pursuant to this Indenture will affect the Trustee's own rights, duties or
immunities under the Securities and this Indenture or otherwise in a manner
which is not reasonably acceptable to the Trustee.
Notwithstanding the provisions of Section 2.01 and of the preceding
paragraph, if all Securities of a series are not to be originally issued at one
time, it shall not be necessary to deliver the Officer's Certificate otherwise
required pursuant to Section 2.01 or the Company Order and Opinion of Counsel
otherwise required pursuant to such preceding paragraph at or prior to the time
of authentication of each Security of such series if such documents are
delivered at or prior to the authentication upon original issuance of the first
Security of such series to be issued; provided that paragraph (a) of said
Opinion of Counsel shall, in such case, read as follows:
"(a) that such forms have been established in conformity with the
provisions of this Indenture and the procedures for determining the
Terms of such Securities as set forth in the procedures hereinabove
referred to have been established in conformity with the provisions of
this Indenture."
SECTION 2.04. Temporary Securities.
Pending the preparation of definitive Securities of any series, the
Company may execute, and upon Company Order the Trustee shall authenticate and
deliver, temporary Securities which are printed, lithographed, typewritten,
mimeographed or otherwise produced, in any authorized denomination,
substantially of the tenor of the definitive Securities in lieu of which they
are issued, in registered form and with such appropriate insertions, omissions,
substitutions and other variations as the Officers executing such Securities may
determine, as evidenced conclusively by their execution of such Securities. Such
temporary Securities may be in global form.
If temporary Securities of any series are issued, the Company will cause
definitive Securities of that series to be prepared without unreasonable delay.
After the preparation of definitive Securities of such series, the temporary
Securities of such series shall be exchangeable for definitive Securities of
such series upon surrender of the temporary Securities of such series at the
office or agency of the Company maintained pursuant to Section 2.05 for the
purpose of exchanges of Securities of such series, without charge to the Holder.
Upon surrender for cancellation of any one or more temporary Securities of any
series the Company shall execute and the Trustee shall authenticate and deliver
in exchange therefor a like aggregate Principal Amount of definitive Securities
of the same series and of like tenor or authorized denominations and having the
same Terms and conditions.
Until exchanged in full as hereinabove provided, the temporary
Securities of any series shall in all respects be entitled to the same benefits
under this Indenture as definitive Securities of the same series and of like
tenor authenticated and delivered hereunder.
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SECTION 2.05. Registrar and Paying Agent
The Company shall maintain an office or agency where Securities may be
presented for registration of transfer or for exchange (the "Registrar") and an
office or agency where Securities may be presented for payment (the "Paying
Agent"). The Registrar shall keep a register of the Securities and of their
transfer and exchange. The Company may have one or more co-registrars and one or
more additional paying agents. The term "Paying Agent" includes any additional
paying agent.
The Company shall enter into an appropriate agency agreement with any
Registrar, Paying Agent or co-registrar not a party to this Indenture, which
shall incorporate the terms of the TIA. The agreement shall implement the
provisions of this Indenture that relate to such agent. The Company shall notify
the Trustee of the name and address of any such agent. If the Company fails to
maintain a Registrar or Paying Agent, the Trustee shall act as such and shall be
entitled to appropriate compensation therefor pursuant to Section 6.07. The
Company or any Subsidiary or Affiliate of the Company may act as Paying Agent,
Registrar, co-registrar or transfer agent.
The Company initially appoints the Trustee as Registrar and Paying Agent
in connection with the Securities.
SECTION 2.06. Paying Agent To Hold Money in Trust
On or prior to each due date of the principal and interest on any
Security, the Company shall deposit with the Paying Agent a sum sufficient to
pay such principal and interest when so becoming due. The Company shall require
each Paying Agent (other than the Trustee) to agree in writing that the Paying
Agent shall hold in trust for the benefit of Securityholders or the Trustee all
money held by the Paying Agent for the payment of principal of or interest on
the Securities and shall notify the Trustee of any default by the Company in
making any such payment. If the Company or any Subsidiary or Affiliate of the
Company acts as Paying Agent, it shall segregate the money held by it as Paying
Agent and hold it as a separate trust fund. The Company at any time may require
a Paying Agent to pay all money held by it to the Trustee and to account for any
funds disbursed by the Paying Agent. Upon complying with this Section, the
Paying Agent shall have no further liability for the money delivered to the
Trustee.
Any money deposited with the Trustee or any Paying Agent, or then held
by the Company, in trust for the payment of the principal of and premium, if
any, or interest, if any, on any Security and remaining unclaimed for two years
after such principal and premium, if any, or interest, if any, has become due
and payable shall be paid to the Company on Company Request, or, if then held by
the Company, shall be discharged from such trust; and, upon such payment or
discharge, the Holder of such Security shall, as an unsecured general creditor
and not as the Holder of an outstanding Security, look only to the Company for
payment of the amount so due and payable and remaining unpaid, and all liability
of the Trustee or such Paying Agent with respect to such trust money, and all
liability of the Company as trustee thereof, shall thereupon
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cease; provided, however, that the Trustee or such Paying Agent, before being
required to make any such payment to the Company, may at the expense of the
Company cause to be mailed, on one occasion only, notice to such Holder that
such money remains unclaimed and that, after a date specified therein, which
shall not be less than thirty (30) days from the date of such mailing, any
unclaimed balance of such money then remaining will be paid to the Company.
SECTION 2.07. Securityholder Lists
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
Securityholders. If the Trustee is not the Registrar, the Company shall furnish
to the Trustee, in writing at least five Business Days before each ________ and
__________ and at such other times as the Trustee may request in writing, a list
in such form and as of such date as the Trustee may reasonably require of the
names and addresses of Securityholders.
SECTION 2.08. Transfer and Exchange
The Securities shall be issued in registered form and shall be
transferable only upon the surrender of a Security with similar Terms of the
same series for registration of transfer. When a Security is presented to the
Registrar or a co-registrar with a request to register a transfer, the Registrar
shall register the transfer as requested, subject to compliance with this
paragraph. When Securities of a series are presented to the Registrar or a
co-registrar with a request to exchange them for an equal Principal Amount of
Securities of such series with similar Terms of other denominations, the
Registrar shall make the exchange as requested, subject to such compliance. To
permit registration of transfers and exchanges, the Company shall execute and
the Trustee shall authenticate Securities of the applicable series with similar
Terms at the Registrar's or co-registrar's request. The Company may require
payment of a sum sufficient to pay all taxes, assessments or other governmental
charges. Every Security presented or surrendered for registration of transfer or
for exchange shall (if so required by the Company or the Trustee) be duly
endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Company and the Registrar duly executed, by the Holder
thereof or his attorney duly authorized in writing. The Company shall not be
required (i) to issue, register the transfer of or exchange Securities of any
series during a period beginning at the opening of business 15 days before the
day of the mailing of a notice of redemption of Securities of that series
selected for redemption under Section 9.03 and ending at the close of business
on the day of such mailing, or (ii) to register the transfer of or exchange any
Security so selected for redemption in whole or in part, except the unredeemed
portion of any Security being redeemed in part.
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Prior to the due presentation for registration of transfer of any
Security, the Company, the Trustee, the Paying Agent, the Registrar or any
co-registrar may deem and treat the person in whose name a Security is
registered as the absolute owner of such Security for the purpose of receiving
payment of principal of and interest on such Security and for all other purposes
whatsoever, whether or not such Security is overdue, and none of the Company,
the Trustee, the Paying Agent, the Registrar or any co-registrar shall be
affected by notice to the contrary.
SECTION 2.09. Replacement Securities
If a mutilated Security is surrendered to the Registrar or if the Holder
of a Security claims that the Security has been lost, destroyed or wrongfully
taken, the Company shall issue and the Trustee shall authenticate a replacement
Security of the applicable series with similar Terms if the Holder satisfies any
other reasonable requirements of the Trustee. If required by the Trustee or the
Company, such Holder shall furnish evidence to their satisfaction of the
destruction, loss or wrongful taking of any Security so claimed to be lost,
destroyed or wrongfully taken, and an indemnity bond sufficient in the judgment
of the Company and the Trustee to protect the Company, the Trustee, the Paying
Agent, the Registrar and any co-registrar from any loss which any of them may
suffer if a Security is replaced. The Company and the Trustee may charge the
Holder for their expenses in replacing a Security.
Every replacement Security is an additional obligation of the Company.
SECTION 2.10. Outstanding Securities
Securities outstanding at any time are all Securities authenticated by
the Trustee except for those canceled by it, those delivered to it for
cancellation and those described in this Section as not outstanding. A Security
does not cease to be outstanding because the Company or an Affiliate of the
Company holds the Security.
If a Security is replaced pursuant to Section 2.09, it ceases to be
outstanding unless the Trustee and the Company receive proof satisfactory to
them that the replaced Security is held by a bona fide purchaser.
If the Paying Agent segregates and holds in trust, in accordance with
this Indenture, on a redemption date or maturity date money sufficient to pay
all principal, premium (if applicable) and interest payable on that date with
respect to the Securities to be redeemed or maturing, as the case may be, and
the Paying Agent is not prohibited from paying such money to the Securityholders
on that date pursuant to the terms of this Indenture, then on and after that
date such Securities cease to be outstanding and interest on them ceases to
accrue.
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In determining whether the Holders of the requisite Principal Amount of
outstanding Securities have given any request, demand, authorization, direction,
notice, consent or waiver hereunder the Principal Amount of an Original Issue
Discount Security that shall be deemed to be outstanding for such purposes shall
be the amount of the principal thereof that would be due and payable as of the
date of such determination upon a declaration of acceleration of the maturity
thereof pursuant to Section 5.02.
SECTION 2.11. Cancellation
The Company at any time may deliver Securities to the Trustee for
cancellation. The Registrar and the Paying Agent shall forward to the Trustee
any Securities surrendered to them for registration of transfer, exchange or
payment. The Trustee and no one else shall cancel and destroy (subject to the
record retention requirements of the Exchange Act) all Securities surrendered
for registration of transfer, exchange, payment or cancellation and deliver a
certificate of such destruction to the Company unless the Company directs the
Trustee to deliver canceled Securities to the Company. The Company may not Issue
new Securities to replace Securities it has redeemed, paid or delivered to the
Trustee for cancellation.
SECTION 2.12. Default Interest
If the Company defaults in a payment of interest on the Securities, the
Company shall pay defaulted interest (plus interest on such defaulted interest
to the extent lawful at the rate or rates prescribed therefor in the Securities)
in any lawful manner. The Company may also pay the defaulted interest to the
persons who are Securityholders on a subsequent special record date, which date
shall be at least five Business Days prior to the payment date in which case the
Company shall fix or cause to be fixed any such special record date and payment
date, and, at least 15 days before any such special record date, the Company
shall mail to each Securityholder a notice that states the special record date,
the payment date and the amount of defaulted interest to be paid.
SECTION 2.13. Computation of Interest
Except as otherwise specific as contemplated by Section 2.01 for
Securities of any series, interest on the Securities of each series shall be
computed on the basis of a three hundred sixty (360) day year consisting of
twelve (12) thirty (30) day months and, with respect to any period less than a
full calendar month, on the basis of the actual number of days elapsed during
such period.
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ARTICLE 3
COVENANTS
SECTION 3.01. Payment of Securities
The Company shall promptly pay the principal of and interest on the
Securities on the dates and in the manner provided in the Securities and in this
Indenture. Principal and interest shall be considered paid on the date due if on
such date the Trustee or the Paying Agent holds in accordance with this
Indenture money sufficient to pay all principal and interest then due and the
Trustee or the Paying Agent, as the case may be, is not prohibited from paying
such money to the Securityholders on that date pursuant to the terms of this
Indenture.
SECTION 3.02. SEC Reports
The Company shall file with the Trustee, within 30 days after it files
them with the SEC, copies of its annual report and of the information, documents
and other reports (or copies of such portions of any of the foregoing as the SEC
may by rules and regulations prescribe) which the Company is required to file
with the SEC pursuant to Section 13 or 15(d) of the Exchange Act. The Company
shall also comply with the other provisions of TIA Section 314(a)(1),(2) and
(3).
SECTION 3.03. Compliance Certificate
The Company shall deliver to the Trustee within 120 days after the end
of each fiscal year of the Company a certificate from its principal executive
officer, principal financial officer or principal accounting officer stating
that in the course of the performance by such signer of his duties as an officer
of the Company he would normally have knowledge of any Default by the Company or
any noncompliance with the conditions and covenants under the Indenture and
whether or not he knows of any Default or any such noncompliance that occurred
during such period. If such officer does, the certificate shall describe the
Default or non-compliance, its status and what action the Company is taking or
proposes to take with respect thereto. For purposes of this Section 3.03, such
noncompliance shall be determined without regard to any period of grace or
requirement of notice provided under this Indenture.
ARTICLE 4
SUCCESSOR COMPANY
SECTION 4.01. When Company May Merge or Transfer Assets
The Company shall not consolidate with or merge with or into, or convey
or otherwise transfer, or lease, its assets as an entirety (or substantially as
an entirety) to, any person, unless:
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(i) the resulting, surviving or transferee person (if not the
Company) shall be a person organized and existing under the laws
of the United States of America, any State thereof or the
District of Columbia and shall expressly assume, by an indenture
supplemental hereto, executed and delivered to the Trustee, in
form reasonably satisfactory to the Trustee, all the obligations
of the Company under the Securities and this Indenture;
(ii) immediately after giving effect to such transaction no Default
shall have occurred and be continuing; and
(iii) the Company shall have delivered to the Trustee an Officer's
Certificate and an Opinion of Counsel, each stating that such
consolidation, merger, transfer, or lease and such supplemental
indenture comply with this Indenture.
SECTION 4.02. Successor Entity Substituted
Upon any consolidation by the Company with or merger by the Company into
any other person or any conveyance or other transfer, or lease, of the assets of
the Company as an entirety (or substantially as an entirety) in accordance with
Section 4.01, the successor person formed by such consolidation or into which
the Company is merged or to which such conveyance or other transfer, or lease,
is made shall succeed to, and be substituted for, and may exercise every right
and power of, the Company under this Indenture with the same effect as if such
successor person had been named as the Company herein, and thereafter, except in
the case of a lease, the predecessor entity shall be relieved of all obligations
and covenants under this Indenture and the Securities.
ARTICLE 5
DEFAULTS AND REMEDIES
SECTION 5.01. Events of Default
An "Event of Default" occurs if:
(1) the Company defaults in any payment of interest on any Security when the
same becomes due and payable and such default continues for a period of
60 days;
(2) the Company defaults in the payment of the principal of any Security
when the same becomes due and payable at its stated maturity, upon
declaration or otherwise;
(3) the Company fails to comply with any of its agreements in the Securities
or this Indenture (other than those referred to in (1) or (2) above) and
such failure continues for 60 days after the notice specified below;
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(4) the Company pursuant to or within the meaning of any Bankruptcy Law:
(a) commences a voluntary case;
(b) consents to the entry of an order for relief against it in an
involuntary case;
(c) consents to the appointment of a Custodian of it or for any
substantial part of its property; or
(d) makes a general assignment for the benefit of its creditors; or
(5) a court of competent jurisdiction enters an order or decree under any
Bankruptcy Law that:
(a) is for relief against the Company in an involuntary case;
(b) appoints a Custodian of the Company or for any substantial part of
its property; or
(c) orders the winding up or liquidation of the Company;
and the order or decree remains unstayed and in effect for 60 days.
The term "Bankruptcy Law" means Title 11, United States Code, or any
similar Federal or state law for the relief of debtors. The term "Custodian"
means any receiver, trustee, assignee, liquidator, custodian or similar official
under any Bankruptcy Law.
A Default under clause (3) is not an Event of Default until the Trustee
or the Holders of at least 33% in principal amount of the Securities notify the
Company of the Default and the Company does not cure such Default within the
time specified after receipt of such Notice. Such Notice must specify the
Default, demand that it be remedied and state that such notice is a "Notice of
Default".
The Company shall deliver to the Trustee, within 30 days after the
occurrence thereof, written notice in the form of an Officer's Certificate of
any event which with the giving of notice and the lapse of time would become an
Event of Default under clause (3), its status and what action the Company is
taking or proposes to take with respect thereto.
SECTION 5.02. Acceleration
If an Event of Default (other than an Event of Default specified in
Section 5.01(4) or (5)) occurs and is continuing, the Trustee by notice to the
Company, or the Holders of at least 33% in principal amount of the Securities by
notice to the Company and the Trustee, may declare the principal of (or, in
connection with Original Issue Discount Securities, such portion of the
principal amount as may be specified in the terms of such Securities) and
accrued interest on all
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the Securities to be due and payable. Upon such a declaration, such principal
(or portion thereof) and interest shall be due and payable immediately. If an
Event of Default specified in Section 5.01(4) or (5) occurs and is continuing,
the principal of and interest on all the Securities shall ipso facto become and
be immediately due and payable without any declaration or other act on the part
of the Trustee or any Securityholders. If all existing Events of Default have
been cured or waived, except nonpayment of principal or interest that has become
due solely because of acceleration, any such acceleration and its consequences
shall be automatically rescinded unless such rescission would conflict with any
judgment or decree. No such rescission shall affect any subsequent Default or
impair any right consequent thereto.
SECTION 5.03. Other Remedies
If an Event of Default occurs and is continuing, the Trustee may pursue
any available remedy to collect the payment of principal of or interest on the
Securities or to enforce the performance of any provision of the Securities or
this Indenture.
The Trustee may maintain a proceeding even if it does not possess any of
the Securities or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Securityholder in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are cumulative.
SECTION 5.04. Waiver of Past Defaults
The Holders of a majority in principal amount of the Securities by notice to the
Trustee may waive an existing Default and its consequences except (1) a Default
in the payment of the principal of or interest on a Security or (2) a Default in
respect of a provision that under Section 8.02 cannot be amended without the
consent of each Securityholder affected. When a Default is waived, it is deemed
cured, but no such waiver shall extend to any subsequent or other Default or
impair any consequent right.
SECTION 5.05. Control by Majority
The Holders of a majority in Principal Amount of the Securities may
direct the time, method and place of conducting any proceeding for any remedy
available to the Trustee or of exercising any trust or power conferred on the
Trustee. However, the Trustee may refuse to follow any direction that conflicts
with law or this Indenture or, subject to Section 6.01, that the Trustee
determines is unduly prejudicial to the rights of other Securityholders or would
involve the Trustee in personal liability; provided, however, that the Trustee
may take any other action deemed proper by the Trustee that is not inconsistent
with such direction. Prior to taking any action hereunder, the Trustee shall be
entitled to indemnification satisfactory to it in its sole discretion against
all losses and expenses caused by taking or not taking such action.
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SECTION 5.06. Limitation on Suits
A Securityholder may not pursue any remedy with respect to this
Indenture or the Securities unless:
(1) the Holder gives to the Trustee written notice stating that an Event of
Default is continuing;
(2) the Holders of at least 33% in Principal Amount of the Securities make a
written request to the Trustee to pursue the remedy;
(3) such Holder or Holders offer to the Trustee reasonable security or
indemnity against any loss, liability or expense;
(4) the Trustee does not comply with the request within 60 days after
receipt of the request and the offer of security or indemnity; and
(5) the Holders of a majority of Principal Amount of the Securities do not
give the Trustee a direction inconsistent with the request during such
60-day period.
A Securityholder may not use this Indenture to prejudice the rights of
another Securityholder or to obtain a preference or priority over another
Securityholder.
SECTION 5.07. Rights of Holders To Receive Payment
Notwithstanding any other provision of this Indenture, the right of any
Holder to receive payment of principal of and interest on the Securities held by
such Holder, on or after the respective due dates expressed in the Securities,
or to bring suit for the enforcement of any such payment on or after such
respective dates, shall not be impaired or affected without the consent of such
Holder.
SECTION 5.08. Collection Suit by Trustee
If an Event of Default in payment of interest or principal specified in
Section 5.01(1) or (2) occurs and is continuing, the Trustee may recover
judgment in its own name and as trustee of an express trust against the Company
for the whole amount of principal and interest remaining unpaid (together with
interest on such unpaid interest as provided in Section 3.01, to the extent
lawful) and the amounts provided for in Section 6.07.
SECTION 5.09. Trustee May File Proofs of Claim
The Trustee may file such proofs of claim and other papers or documents
as may be necessary or advisable in order to have the claims of the Trustee and
the Securityholders allowed in any judicial proceedings relative to the Company,
its creditors or its property and, unless
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prohibited by law or applicable regulations, may vote on behalf of the Holders
in any election of a trustee in bankruptcy or other person performing similar
functions, and any Custodian in any such judicial proceeding is hereby
authorized by each Holder to make payments to the Trustee and, in the event that
the Trustee shall consent to the making of such payments directly to the
Holders, to pay to the Trustee any amount due it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and its counsel, and any other amounts due the Trustee under Section 6.07.
SECTION 5.10. Priorities
If the Trustee collects any money pursuant to this Article 5, it shall
pay out the money in the following order:
FIRST: to the Trustee for amounts due under Section 6.07;
SECOND: to Securityholders for amounts due and unpaid on the Securities
for principal and interest, ratably, without preference or priority of
any kind, according to the amounts due and payable on the Securities for
principal and interest, respectively; and
THIRD: to the Company.
The Trustee may fix a record date and payment date for any payment to
Securityholders pursuant to this Section. At least 15 days before such record
date, the Company shall mail to each Securityholder and the Trustee a notice
that states the record date, the payment date and amount to be paid.
SECTION 5.11. Undertaking for Costs
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in the suit, having due regard to
the merits and good faith of the claims or defenses made by the party litigant.
This Section does not apply to a suit by the Trustee, a suit by a Holder
pursuant to Section 5.07 or a suit by Holders of more than 10% in Principal
Amount of the Securities.
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SECTION 5.12. Waiver of Stay or Extension Laws
The Company (to the extent it may lawfully do so) shall not at any time
insist upon, or plead, or in any manner whatsoever claim or take the benefit or
advantage of, any stay or extension law wherever enacted, now or at any time
hereafter in force, which may affect the covenants or the performance of this
Indenture; and the Company (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law, and shall not hinder,
delay or impede the execution of any power herein granted to the Trustee, but
shall suffer and permit the execution of every such power as though no such law
had been enacted.
ARTICLE 6
TRUSTEE
SECTION 6.01. Duties of Trustee
(a) If an Event of Default has occurred and is continuing, the Trustee shall
exercise the rights and powers vested in it by this Indenture and use
the same degree of care and skill in their exercise as a prudent person
would exercise or use under the circumstances in the conduct of such
person's own affairs.
(b) Except during the continuance of an Event of Default:
(1) the Trustee undertakes to perform such duties and only such duties
as are specifically set forth in this Indenture and no implied
covenants or obligations shall be read into this Indenture against
the Trustee; and
(2) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming to the requirements
of this Indenture. However, the Trustee shall examine the
certificates and opinions to determine whether or not they conform
to the requirements of this Indenture.
(c) The Trustee may not be relieved from liability for its own negligent
action, its own negligent failure to act or its own willful misconduct,
except that:
(1) this paragraph does not limit the effect of paragraph (b) of this
Section;
(2) the Trustee shall not be liable for any error of judgment made in
good faith by a Trust Officer unless it is proved that the Trustee
was negligent in ascertaining the pertinent facts; and
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(3) the Trustee shall not be liable with respect to any action it takes
or omits to take in good faith in accordance with a direction
received by it pursuant to Section 5.05.
(d) Every provision of this Indenture that in any way relates to the Trustee
is subject to paragraphs (a), (b) and (c) of this Section.
(e) The Trustee shall not be liable for interest on any money received by it
except as the Trustee may agree in writing with the Company.
(f) Money held in trust by the Trustee need not be segregated from other
funds except to the extent required by law.
(g) No provision of this Indenture shall require the Trustee to expend or
risk its own funds or otherwise incur financial liability in the
performance of any of its duties hereunder or in the exercise of any of
its rights or powers, if it shall have reasonable grounds to believe
that repayment of such funds or adequate indemnity against such risk or
liability is not reasonably assured to it.
Every provision of this Indenture relating to the conduct or affecting
the liability of or affording protection to the Trustee shall be subject to the
provisions of this Section and to the provisions of the TIA.
SECTION 6.02. Rights of Trustee
(a) The Trustee may rely on any document believed by it to be genuine and to
have been signed or presented by the proper person. The Trustee need not
investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may require an
Officer's Certificate or an Opinion of Counsel. The Trustee shall not be
liable for any action it takes or omits to take in good faith in
reliance on the Officer's Certificate or Opinion of Counsel, subject to
Section
(c) The Trustee may act through agents and shall not be responsible for the
misconduct or negligence of any agent appointed with due care.
(d) The Trustee shall not be liable for any action it takes or omits to take
in good faith which it believes to be authorized or within its rights or
powers.
(e) The Trustee may consult with counsel, and the advice or opinion of
counsel with respect to legal matters relating to this Indenture and the
Securities shall be full and complete authorization and protection from
liability in respect to any action taken, omitted or suffered by it
hereunder in good faith and in accordance with the advice or opinion of
such counsel.
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SECTION 6.03. Individual Rights of Trustee
The Trustee in its individual or any other capacity may become the owner
or pledgee of Securities and may otherwise deal with the Company or its
affiliates with the same rights it would have if it were not Trustee. Any Paying
Agent, Registrar, co-registrar or co-paying agent may do the same with like
rights. However, the Trustee must comply with Sections 6.10 and 6.11.
SECTION 6.04. Trustee's Disclaimer
The Trustee shall not be responsible for and makes no representation as
to the validity or adequacy of this Indenture or the Securities, it shall not be
accountable for the Company's use of the proceeds from the Securities, and it
shall not be responsible for any statement of the Company in the Indenture or in
any document issued in connection with the sale of the Securities or in the
Securities other than the Trustee's certificate of authentication.
SECTION 6.05. Notice of Defaults
If a Default occurs and is continuing and if it is known to the Trustee,
the Trustee shall mail to each Securityholder notice of the Default within 90
days after it occurs. Except in the case of a Default in payment of principal of
or interest on any Security (including payments pursuant to the mandatory
redemption provisions of such Security), the Trustee may withhold the notice if
and so long as a committee of its Trust Officers in good faith determines that
withholding the notice is in the interests of Securityholders.
SECTION 6.06. Reports by Trustee to Holders
Prior to November 1 in each year, the Trustee shall mail to each
Securityholder a brief report dated as of the preceding September 1 that
complies with TIA Section 313(a), if so required by such Section of the TIA. The
Trustee also shall comply with TIA Section 313(b).
A copy of each report at the time of its mailing to Securityholders
shall be filed with the SEC and each stock exchange on which the Securities are
listed. The Company agrees to notify promptly the Trustee whenever the
Securities become listed on any stock exchange and of any delisting thereof.
SECTION 6.07. Compensation and Indemnity
The Company shall pay to the Trustee from time to time reasonable
compensation for its services, including those arising in the Trustee's
performance of its duties under Sections 5.02, 5.03 and 5.08 hereof, and to the
extent permitted by law, Section 5.09 hereof. The Trustee's compensation shall
not be limited by any law on compensation of a trustee of an express trust. The
Company shall reimburse the Trustee upon request for all reasonable
out-of-pocket expenses incurred or made by it, including costs of collection, in
addition to the compensation for its
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services. Such expenses shall include the reasonable compensation and expenses,
disbursements and advances of the Trustee's agents, counsel, accountants and
experts. The Company shall indemnify the Trustee against any and all loss,
liability or expense (including attorneys' fees) incurred by it in connection
with the administration of this trust and the performance of its duties
hereunder. The Trustee shall notify the Company promptly of any claim for which
it believes it may seek indemnity. Failure by the Trustee to so notify the
Company shall not relieve the Company of its obligations hereunder. The Company
shall defend the claim and the Trustee may have separate counsel and the Company
shall pay the reasonable fees and expenses of such counsel. The Company need not
reimburse any expense or indemnify against any loss, liability or expense to the
extent incurred by the Trustee through the Trustee's own willful misconduct,
negligence or bad faith.
To secure the Company's payment obligations in this Section, the Trustee
shall have a Lien prior to the Securities on all money or property held or
collected by the Trustee, except that held in trust to pay principal of and
interest on particular Securities.
The Company's payment obligations pursuant to this Section shall survive
the discharge of this Indenture.
For purposes of this Section, the term "Trustee" shall include any
predecessor Trustee, provided that any Trustee hereunder shall not be liable for
the willful misconduct, negligence or bad faith of any other Trustee hereunder.
SECTION 6.08. Replacement of Trustee
The Trustee may resign at any time by so notifying the Company. The
Holders of a majority in Principal Amount of the Securities or, as long as no
Event of Default under Section 5.01 has occurred or is continuing, the Company
may remove the Trustee by so notifying the Trustee and may appoint a successor
Trustee.
The Company shall remove the Trustee if:
(1) the Trustee fails to comply with Section 6.10;
(2) the Trustee is adjudged bankrupt or insolvent;
(3) a receiver or other public officer takes charge of the Trustee or
its property; or
(4) the Trustee otherwise becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason (the Trustee in such event being referred to
herein as the retiring Trustee), the Company shall promptly appoint a successor
Trustee.
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A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Securityholders. The retiring Trustee shall promptly transfer all
property held by it as Trustee to the successor Trustee, subject to the Lien
provided for in Section 6.07.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company or the
Holders of a majority in Principal Amount of the Securities may petition any
court of competent jurisdiction for the appointment of a successor Trustee. If
the Trustee fails to comply with Section 6.10, any Securityholder (subject to
compliance with TIA Section 310(b)(iii)) may petition any court of competent
jurisdiction for the removal of the Trustee and the appointment of a successor
Trustee.
Notwithstanding the replacement of the Trustee pursuant to this Section,
the Company's obligations under Section 6.07 shall continue for the benefit of
the retiring Trustee.
SECTION 6.09. Successor Trustee by Merger
If the Trustee consolidates with, merges or converts into, or transfers
all or substantially all its corporate trust business or assets to, another
corporation or banking association, the resulting, surviving or transferee
corporation without any further act shall be the successor Trustee.
In case at the time such successor or successors by merger, conversion
or consolidation to the Trustee shall succeed to the trusts created by this
Indenture any of the Securities shall have been authenticated but not delivered,
any such successor to the Trustee may adopt the certificate of authentication of
any predecessor trustee, and deliver such Securities so authenticated; and in
case at that time any of the Securities shall not have been authenticated, any
successor to the Trustee may authenticate such Securities either in the name of
any predecessor hereunder or in the name of the successor to the Trustee; and in
all such cases such certificates shall have the full force which it is anywhere
in the Securities or in this Indenture provided that the certificate of the
Trustee shall have.
SECTION 6.10. Eligibility; Disqualification
The Trustee shall at all times satisfy the requirements of TIA Section
310(a). The Trustee shall have a combined capital and surplus of at least
$50,000,000 as set forth in its most recent published annual report. The Trustee
shall comply with TIA Section 310(b).
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SECTION 6.11. Preferential Collection of Claims Against Company
The Trustee shall comply with TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). A Trustee who has resigned or been
removed shall be subject to TIA Section 311(a) to the extent indicated.
ARTICLE 7
DISCHARGE OF SECURITIES AND INDENTURE
SECTION 7.01. Satisfaction and Discharge of Securities
Any Security or Securities, or any portion of the Principal Amount
thereof, shall be deemed to have been paid for all purposes of this Indenture,
and the entire indebtedness of the Company in respect thereof shall be satisfied
and discharged, if there shall have been irrevocably deposited with the Trustee
or any Paying Agent, in trust:
(a) money in an amount which shall be sufficient, or
(b) in the case of a deposit made prior to the maturity of such Securities
or portions thereof , U.S. Government Obligations, which shall not
contain provisions permitting the redemption or other prepayment thereof
at the option of the issuer thereof, the principal of and the interest
on which when due, without any regard to reinvestment thereof, will
provide moneys which, together with the money, if any, deposited with or
held by the Trustee or such Paying Agent, shall be sufficient, or
(c) a combination of (a) or (b) which shall be sufficient,
to pay when due the principal of and premium, if any, and interest, if any, due
and to become due on such Securities or portions thereof; provided, however,
that in the case of a redemption, the notice requisite to the validity of such
redemption shall have been given or irrevocable authority shall have been given
by the Company to give such notice, under arrangements satisfactory to the
Trustee; and provided, further, that the Company shall have delivered to the
Trustee and such Paying Agent:
(x) if such deposit shall have been made prior to the maturity of such
Securities, a Company Request stating that the money and U.S. Government
Obligations deposited in accordance with this Section shall be held in
trust, as provided in Section 7.03;
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(y) if U.S. Government Obligations shall have been deposited, an Opinion of
Counsel to the effect that such obligations constitute U.S. Government
Obligations and do not contain provisions permitting the redemption or
other prepayment thereof at the option of the issuer thereof, and an
opinion of an independent public accountant of nationally recognized
standing, selected by the Company, to the effect that the other
requirements set forth in clause (b) above have been satisfied; and
(z) if such deposit shall have been made prior to the maturity of such
Securities, an Officer's Certificate stating the Company's intention
that, upon delivery of such Officer's Certificate, its indebtedness in
respect of such Securities or portions thereof will have been satisfied
and discharged as contemplated in this Section.
Upon the deposit of money or U.S. Government Obligations, or both, in
accordance with this Section, together with the documents required by clauses
(x), (y) and (z) above, the Trustee shall, upon Company Request, acknowledge in
writing that such Securities or portions thereof are deemed to have been paid
for all purposes of this Indenture and that the entire indebtedness of the
Company in respect thereof has been satisfied and discharged as contemplated in
this Section. In the event that all of the conditions set forth in the preceding
paragraph shall have been satisfied in respect of any Securities or portions
thereof except that, for any reason, the Officer's Certificate specified in
clause (z) (if otherwise required) shall not have been delivered, such
Securities or portions thereof shall nevertheless be deemed to have been paid
for all purposes of this Indenture, and the Holders of such Securities or
portions thereof shall nevertheless be no longer entitled to the benefits
provided by this Indenture or of any of the covenants of the Company under
Article Three or any other covenants made in respect of such Securities or
portions thereof shall not be deemed to have been satisfied and discharged prior
to maturity for any other purpose; and, upon Company Request, the Trustee shall
acknowledge in writing that such Securities or portions thereof are deemed to
have been paid for all purposes of this Indenture.
If payment at stated maturity of less than all of the Securities of any
series is to be provided for in the manner and with the effect provided in this
Section, the Trustee shall select such Securities, or portions of principal
amount thereof, in the manner specified by Section 9.03 for selection for
redemption of less than all the Securities of a series.
In the event that Securities which shall be deemed to have been paid for
purposes of this Indenture, and, if such is the case, in respect of which the
Company's indebtedness shall have been satisfied and discharged, all as provided
in this Section, do not mature and are not to be redeemed within the sixty (60)
day period commencing with the date of the deposit of moneys or U.S. Government
Obligations, as aforesaid, the Company shall, as promptly as practicable, give a
notice, in the same manner as a notice of redemption with respect to such
Securities, to the Holders of such Securities to the effect that such deposit
has been made and the effect thereof.
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Notwithstanding that any Securities shall be deemed to have been paid
for purposes of this Indenture, as aforesaid, the obligations of the Company and
the Trustee in respect of such Securities under Sections 2.05, 2.06, 2.08, 2.09,
6.07, 6.08, and 9.04 and this Article shall survive.
The Company shall pay, and shall indemnify the Trustee or any Paying
Agent with which U.S. Government Obligations shall have been deposited as
provided in this Section against, any tax, fee or other charge imposed on or
assessed against such U.S. Government Obligations or the principal or interest
received in respect of such U.S. Government Obligations, including, but not
limited to, any such tax payable by any entity deemed, for tax purposes, to have
been created as a result of such deposit.
Anything herein to the contrary notwithstanding, (a) if, at any time
after a Security would be deemed to have been paid for purposes of this
Indenture, and, if such is the case, the Company's indebtedness in respect
thereof would be deemed to have been satisfied and discharged, pursuant to this
Section (without regard to the provisions of this paragraph), the Trustee or any
Paying Agent, as the case may be, shall be required to return the money or U.S.
Government Obligations, or combination thereof, deposited with it as aforesaid
to the Company or its representative under any applicable Federal or State
bankruptcy, insolvency or other similar law, such Security shall thereupon be
deemed retroactively not to have been paid and any satisfaction and discharge of
the Company's indebtedness in respect thereof shall retroactively be deemed not
to have been effected, and such Security shall be deemed to remain Outstanding
and (b) any satisfaction and discharge of the Company's indebtedness in respect
of any Security shall be subject to the provisions of the last paragraph of
Section 2.06.
SECTION 7.02. Satisfaction and Discharge of Indenture
This Indenture shall upon Company Request cease to be of further effect
(except as hereinafter expressly provided), and the Trustee, at the expense of
the Company, shall execute such instruments as the Company shall reasonably
request to evidence and acknowledge the satisfaction and discharge of this
Indenture when:
(a) both
(1) all Securities theretofore authenticated and delivered (other than
Securities that have been destroyed, lost or stolen and that have
been replaced or paid as provided in Section 2.09) have been
delivered to the Trustee for cancellation; and
(2) all Securities not theretofore delivered to the Trustee for
cancellation have been deemed paid in accordance with Section 7.01;
and
(b) the Company has paid or caused to be paid all other sums payable
hereunder by the Company;
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provided, however, that if, in accordance with the last paragraph of Section
7.01, any Security, previously deemed to have been paid for purposes of this
Indenture, shall be deemed retrospectively not to have been so paid, this
Indenture shall thereupon be deemed retrospectively not to have been satisfied
and discharged, as aforesaid, and to remain in full force and effect, and the
Company shall execute and deliver such instruments as the Trustee shall
reasonable request to evidence and acknowledge the same.
Notwithstanding the satisfaction and discharge of this Indenture as
aforesaid, the obligations of the Company and the Trustee under Sections 2.05,
2.06, 2.08, 2.09, 6.07, 6.08, and 9.04 and this Article shall survive.
Upon satisfaction and discharge of this Indenture as provided in this
Section, the Trustee shall turn over to the Company any and all money,
securities, and other property then held by the Trustee for the benefit of the
Holders of the Securities (other than money and U.S. Government Obligations held
by the Trustee pursuant to Section 7.03) and shall execute and deliver to the
Company such instruments as, in the judgment of the Company, shall be necessary,
desirable or appropriate to effect of evidence the satisfaction and discharge of
this Indenture.
SECTION 7.03. Application of Trust Money
Neither the U.S. Government Obligations nor the money deposited pursuant
to section 7.01, nor the principal or interest payments on any such U.S.
Government Obligations, shall be withdrawn or used for any purpose other than,
and shall be held in trust for, the payment of the principal of and premium, if
any and interest, if any, on the Securities or portions of principal amount
thereof in respect of which such deposit was made, all subject, however, to the
provisions of Section 2.06; provided, however, that any cash received from such
principal or interest payment on such U.S. Government Obligations, if not then
needed for such purpose, shall, to the extent practicable and upon Company
Request and delivery to the Trustee of the Documents referred to in clause (y)
in the first paragraph of Section 7.01, be invested in U.S. Government
Obligations of the type described in clause (b) in the first paragraph of
Section 6.01 maturing at such times and in such amounts as shall be sufficient,
together with any other moneys and the proceeds of any other U.S. Government
Obligations then held by the Trustee, to pay when due the principal of, and
premium, if any, and interest, if any, due and to become due on such Securities
or portions thereof on and prior to the maturity thereof, and interest earned
from such reinvestment shall be paid over the Company as received, free and
clear of any trust, lien or pledge under this Indenture; and provided, further,
that any moneys held in accordance with this Section on the maturity of all such
Securities in excess of the amount required to pay the principal of and premium,
if any, and interest, if any, then due on such Securities shall be paid over to
the Company free and clear of any trust, lien or pledge under this Indenture;
and provided, further, that if an Event of Default shall have occurred and be
continuing, moneys to be paid over to the Company pursuant to this Section shall
be held until such Event of Default shall have been waived or cured.
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ARTICLE 8
AMENDMENTS
SECTION 8.01. Without Consent of Holders
The Company and the Trustee may amend this Indenture or the Securities
without notice to or consent of any Securityholder:
(1) to cure any ambiguity, omission, defect or inconsistency;
(2) to comply with Article 4;
(3) to provide for the procedures required to permit the Company for
utilize, at its option, a non-certificated system of registration for
all or any series of the Securities;
(4) to provide collateral security for the Securities;
(5) to add to the covenants of the Company for the benefit of the Holders or
to surrender any right or power herein conferred upon the Company;
(6) to make any change that does not adversely affect the rights of any
Securityholder in any material respect.
Without limiting the generality of the foregoing, if the TIA as in
effect at the date of the execution and delivery of this Indenture or any time
thereafter shall be amended and (i) if any such amendment shall require one or
more changes to any provisions hereof or the inclusion herein of any additional
provision, or shall by operation of law be deemed to effect such changes or
incorporate such provisions by reference or otherwise, this Indenture shall be
deemed to have been amended so as to conform to such amendment to the TIA and
the Company and the Trustee may, without the consent of any Holders, enter into
an indenture supplemental hereto to evidence such amendment hereof or (ii) if
any such amendment shall permit one or more changes to, or the elimination of,
any provisions hereof which, at the date of the execution and delivery hereof or
at any time thereafter, are required by the TIA to be contained herein or are
contained herein to reflect any provisions of the TIA as in effect at such date,
this Indenture shall be deemed to have been amended to effect such changes or
elimination, and the Company and the Trustee may, without the consent of any
Holders, enter into an indenture supplemental hereto to amend this Indenture to
effect such changes or elimination.
After an amendment under this Section becomes effective, the Company
shall mail to Securityholders a notice briefly describing such amendment. The
failure to give such notice to all Securityholders, or any defect therein, shall
not impair or affect the validity of an amendment under this Section.
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SECTION 8.02. With Consent of Holders
The Company and the Trustee may amend this Indenture or the Securities
without notice to any Securityholder but with the written consent of the Holders
of at least a majority in principal amount of the Securities. However, without
the consent of each Securityholder affected, an amendment may not:
(1) reduce the amount of Securities whose Holders must consent to an
amendment;
(2) reduce the rate of or extend the time for payment of interest on any
Security;
(3) reduce the principal of or extend the fixed maturity of any Security;
(4) reduce the premium payable upon the redemption of any Security or change
the time at which any Security may or shall be redeemed;
(5) make any Security payable in money other than that stated in the
Security; or
(6) make any change in Section 5.04 or this Section;
and, provided further, that in case more than one series of Securities (or
Securities of a single series which have different Terms) shall be outstanding
under this Indenture, and any such proposed amendment shall affect the rights of
Holders of the Securities of one or more series (or Securities of a single
series which have different Terms) and shall not affect the rights of Holders of
the Securities of one or more of the other series (or Securities of a single
series which have different Terms), then only Holders of Securities to be
affected shall have authority or be required to consent to or approve such
amendment. Any waiver of a default provided for in Section 5.04 shall be deemed
to affect the Securities of all series, and, subject to the foregoing, any
modification of the provisions of any sinking fund or covenant established in
respect of Securities of a particular series (or Securities of a single series
having the same Terms) shall be deemed to affect only such Securities.
It shall not be necessary for the consent of the Holders under this
Section 8.02 to approve the particular form of any proposed amendment, but it
shall be sufficient if such consent approves the substance thereof.
After an amendment under this Section becomes effective, the Company
shall mail to Holders of the affected Securities a notice briefly describing
such amendment. The failure to give such notice to all Securityholders (or all
Holders of the affected Securities), or any defect therein, shall not impair or
affect the validity of an amendment under this Section.
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SECTION 8.03. Compliance with Trust Indenture Act
Every amendment to this Indenture or the Securities shall comply with
the TIA as then in effect.
SECTION 8.04. Revocation and Effect of Consents and Waivers
A consent to an amendment or any other action hereunder or a waiver by a
Holder of a Security shall bind the Holder and every subsequent Holder of that
Security or portion of the Security that evidences the same debt as the
consenting Holder's Security, even if notation of the consent or waiver is not
made on the Security. However, any such Holder or subsequent Holder may revoke
the consent or waiver as to such Holder's Security or portion of the Security if
the Trustee receives the notice of revocation before the date the amendment or
waiver becomes effective. After an amendment or waiver becomes effective, it
shall bind every Securityholder.
The Company may, but shall not be obligated to, fix a record date for
the purpose of determining the Securityholders entitled to take any action under
this Indenture by vote or consent. Such record date shall be the later of 30
days prior to the first solicitation of such consent or vote or the date of the
most recent list of Holders of the affected Securities furnished to the Trustee
pursuant to Section 2.07 prior to such solicitation. If a record date is fixed,
those persons who were Securityholders at such record date (or their duly
designated proxies), and only those persons, shall be entitled to take such
action by vote or consent or to revoke any vote or consent previously given,
whether or not such persons continue to be Securityholders after such record
date.
SECTION 8.05. Notation on or Exchange of Securities
If an amendment changes the terms of a Security, the Trustee may require
the Holder of the Security to deliver it to the Trustee. The Trustee may place
an appropriate notation on the Security regarding the changed terms and return
it to the Holder. Alternatively, if the Company or the Trustee so determines,
the Company in exchange for the Security shall issue and the Trustee shall
authenticate a new Security that reflects the changed terms. Failure to make the
appropriate notation or to issue a new Security shall not affect the validity of
such amendment.
SECTION 8.06. Trustee To Sign Amendments
The Trustee shall sign any amendment authorized pursuant to this Article
8 if the amendment does not adversely affect the rights, duties, liabilities or
immunities of the Trustee. If it does, the Trustee may but need not sign it. In
signing such amendment the Trustee shall be entitled to receive indemnity
reasonably satisfactory to it and to receive, and (subject to Section 6.01)
shall be fully protected in relying upon, an Officer's Certificate and an
Opinion of Counsel stating that such amendment is authorized or permitted by
this Indenture.
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ARTICLE 9
REDEMPTION
SECTION 9.01. Applicability
Securities of any series which are redeemable before their final
maturity shall be redeemable in accordance with their Terms and (except as
otherwise specified as contemplated by Section 2.01 for Securities of any
series) in accordance with this Article.
SECTION 9.02. Notice to Trustee
The Company may, with respect to any series of Securities (or Securities
of a series having the same Terms), reserve the right to redeem and pay such
Securities or any part thereof, or may covenant to redeem and pay the series of
Securities (or Securities of a series having the same Terms) or any part
thereof, before maturity at such time and on such terms as provided for in such
Securities. If a series of Securities (or Securities of a series having the same
Terms) is redeemable and the Company wants or is obligated to redeem all or part
of the series of Securities (or Securities of a series having the same Terms)
pursuant to the Terms of such Securities, the Company shall notify the Trustee
of the redemption date and the Principal Amount of the series of Securities (or
Securities of a series having the same Terms) to be redeemed. The Company shall
give such notice at least 45 days before the redemption date (or such shorter
notice as may be acceptable to the Trustee in its sole discretion).
SECTION 9.03. Selection of Securities To Be Redeemed
If less than all the Securities of a series (or Securities of a series
having the same Terms) are to be redeemed, the Trustee, not more than 45 days
prior to the redemption date, shall select the Securities of the series (or
Securities of a series having the same Terms) to be redeemed pro rata or by lot
or by such other method as the Trustee shall deem fair and appropriate. The
Trustee shall make the selection from Securities that are outstanding and that
have not previously been called for redemption. Securities of the series (or
Securities of a series having the same Terms) and portions of them selected by
the Trustee shall be in amounts of $1,000 or integral multiples of $1,000 or
with respect to Securities of any Series issuable in other denominations
pursuant to Section 2.01(8), in amounts equal to the minimum principal
denomination for each such series and in integral multiples thereof. Provisions
of this Indenture that apply to Securities of that series (or Securities of a
series having the same Terms) called for redemption also apply to portions of
Securities of that series (or Securities of a series having the same Terms)
called for redemption. The Trustee shall promptly notify the Company in writing
of the Securities selected for redemption and, in the case of any Securities
selected for partial redemption, the Principal Amount thereof to be redeemed.
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SECTION 9.04. Notice of Redemption
(a) At least 30 days but not more than 60 days before a redemption date,
unless a shorter period is specified in the Terms of the Securities to
be redeemed, the Company shall cause to be mailed a notice of redemption
by first-class mail to each Holder of Securities that are to be
redeemed.
(b) All notices of redemption shall identify the Securities to be redeemed
and shall state:
(1) the redemption date;
(2) the redemption price and interest, if any, payable upon such
redemption;
(3) if less than all the outstanding Securities of a series (or
Securities of a series having the same Terms) are to be redeemed,
the identification (and, in the case of partial redemption, the
Principal Amounts) of the particular Securities to be redeemed;
(4) the name and address of the Paying Agent;
(5) that the Securities called for redemption must be surrendered to the
Paying Agent to collect the redemption price; and
(6) that interest on Securities called for redemption ceases to accrue
on and after the redemption date.
(c) If at the time of any notice of redemption the Company shall not have
deposited or caused to be deposited with the Trustee moneys sufficient
to redeem all the Debentures called for redemption, such notice shall
state that it is subject to the deposit of the redemption moneys with
the Trustee not later than the opening of business on the redemption
date and shall be of no effect unless such moneys are so deposited. If
such moneys are not deposited by such date and time, the Trustee shall
promptly notify the holders of all Debentures called for redemption of
such fact.
At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at the Company's expense.
SECTION 9.05. Effect of Notice of Redemption
Once notice of redemption is mailed, and such notice is not conditional
as provided in Section 9.04(c) above, Securities called for redemption become
due and payable on the redemption date at the redemption price. Any failure to
mail notice of redemption or any defect therein shall not affect the redemption
of any other Securities called for redemption.
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Upon surrender to the Paying Agent of such Securities, such Securities
shall be paid at the redemption price plus accrued interest to the redemption
date, but installments of interest due on or prior to the redemption date will
be payable to the Holders of such Securities of record at the close of business
on the relevant record dates, unless otherwise specified in the Terms of such
Securities.
SECTION 9.06. Deposit of Redemption Price
On or before the redemption date, the Company shall deposit with the
Paying Agent money sufficient to pay the redemption price of and interest
accrued to the redemption date on all Securities to be redeemed on that date.
SECTION 9.07. Securities Redeemed in Part
Upon surrender of a Security that is redeemed in part, the Company shall
issue and the Trustee shall authenticate for the Holder of that Security a new
Security or Securities of the same series and terms in authorized denominations
equal in aggregate principal amount to the unredeemed portion of the Security
surrendered.
ARTICLE 10
SINKING FUNDS
SECTION 10.01. Applicability
The provisions of this Article shall be applicable to any sinking fund
for the retirement of Securities, except as otherwise specified as contemplated
by Section 2.01 for Securities of any series.
The minimum amount of any sinking fund payment provided for by the Terms
of any Securities is herein referred to as a "Mandatory Sinking Fund Payment",
and any payment in excess of such minimum amount provided for by the terms of
such Securities is herein referred to as an "Optional Sinking Fund Payment". If
provided for by the Terms of Securities, the cash amount of any sinking fund
payment may be subject to reduction as provided in Section 10.02. Each sinking
fund payment shall be applied to the redemption of Securities of any series (or
Securities of a series having the same Terms) as provided for by the Terms of
such Securities.
SECTION 10.02. Satisfaction of Sinking Fund Payments with Securities
The Company may, in satisfaction of all or any part of any sinking fund
payment with respect to the Securities to be made pursuant to the Terms of such
Securities as provided for by such Terms, (1) deliver outstanding Securities of
such series having the same Terms (other than any of such Securities previously
called for redemption) and (2) apply as credit Securities of such
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<PAGE> 41
series having the same Terms which have been redeemed either at the election of
the Company pursuant to the Terms of such Securities or through the application
of permitted Optional Sinking Fund Payments pursuant to the Terms of such
Securities, provided that such Securities have not been previously so credited.
Such Securities shall be received and credited for such purpose by the Trustee
at the price specified in such Securities for redemption through operation of
the sinking fund and the amount of such sinking fund payment shall be reduced
accordingly. If as a result of the delivery or credit of Securities in lieu of
cash payments pursuant to this Section 10.02, the Principal Amount of Securities
to be redeemed in order to exhaust the aforesaid cash payment shall be less than
$100,000, the Trustee need not call Securities for redemption, except upon
receipt of a Company Order that such action be taken, and such cash payment
shall be held by the Trustee or a Paying Agent and applied to the next
succeeding sinking fund payment with respect to such series of Securities (or
Securities of such series having the same Terms), provided, however, that the
Trustee or such Paying Agent shall at the request of the Company from time to
time pay over and deliver to the Company any cash payment so being held by the
Trustee or such Paying Agent upon delivery by the Company to the Trustee of
Securities of that series having the same Terms purchased by the Company having
an unpaid Principal Amount equal to the cash payment required to be released to
the Company.
SECTION 10.03. Redemption of Securities for Sinking Fund
Not less than 60 days prior to each sinking fund payment date for any
series of Securities (or Securities of such series having the same Terms), the
Company will deliver to the Trustee an Officer's Certificate specifying the
amount of the next ensuing Mandatory Sinking Fund Payment for that series (or
Securities of such series having the same Terms) pursuant to the Terms of that
series, the portion thereof, if any, which is to be satisfied by payment of cash
and the portion thereof, if any, which is to be satisfied by delivering and
crediting of Securities of that series (or Securities of such series having the
same Terms) pursuant to Section 10.02, and the optional amount, if any, to be
added in cash to the next ensuing Mandatory Sinking Fund Payment, and the
Company shall thereupon be obligated to pay the amount therein specified. Not
less than 30 days before each such sinking fund payment date the Trustee shall
select the Securities to be redeemed upon such sinking fund payment date in the
manner specified in Section 9.03 and cause notice of the redemption thereof to
be given in the name of and at the expense of the Company in the manner provided
in Section 9.04. Such notice having been duly given, the redemption of such
Securities shall be made upon the terms and in the manner stated in Sections
9.05, 9.06 and 9.07.
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ARTICLE 11
MEETINGS OF HOLDERS; ACTIONS WITHOUT MEETING
SECTION 11.01. Purposes for Which Meetings May Be Called
A meeting of Holders of Securities of one or more, or all, series may be
called at any time and from time to time pursuant to this Article to make, give
or take request, demand, authorization, direction, notice, consent, waiver or
other action provided by this Indenture to be made, given or taken by Holders of
Securities of such series.
SECTION 11.02. Call, Notice and Place of Meetings
(a) The Trustee may at any time call a meeting of Holders of Securities of
one or more, or all, series for any purpose specified in Section 11.01,
to be held at such time and (except as provided in subsection (b) of
this Section) at such place in the Borough of Manhattan, The City of New
York, as the Trustee shall determine, or, with the approval of the
Company, at any other place. Notice of every such meeting, setting forth
the time and the place of such meeting and in general terms the action
proposed to be taken at such meeting, shall be given not less than
twenty-one (21) nor more than one hundred eighty (180) days prior to the
date fixed for the meeting.
(b) The Trustee may be asked to call a meeting of the Holders of Securities
of one or more, or all, series by the Company or the Holders of
thirty-three percent (33%) in aggregate principal amount of all of such
series, considered as one class, for any purpose specified in Section
11.01, by written request setting forth in reasonable detail the action
proposed to be taken at the meeting. If the Trustee shall have been
asked by the Company to call such a meeting, the Company shall determine
the time and place for such meeting and may call such meeting by giving
notice thereof in the manner provided in subsection (a) of this Section,
or shall direct the Trustee, in the name and at the expense of the
Company, to give such notice. If the Trustee shall have been asked to
call such a meeting by Holders in accordance with this subsection (b),
and the Trustee shall not have given the notice of such meting within
twenty-one (21) days after receipt of such request or shall not
thereafter proceed to cause the meeting to be held as provided herein,
then the Holders of Securities of such series, in the principal amount
above specified, may determine the time and the place in the Borough of
Manhattan, The City of New York, or in such other place as shall be
determined or approved by the Company, for such meeting and may call
such meeting for such purposes by giving notice thereof as provided in
subsection (a) of this Section.
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(c) Any meeting of Holders of Securities of one or more, or all, series
shall be valid without notice if the Holders of all outstanding
Securities of such series are present in person or by proxy and if
representatives of the Company and the Trustee are present, or if notice
is waived in writing before or after the meeting by the Holders of all
outstanding Securities of such series or by such of them as are not
present at the meeting in person or by proxy, and by the Company and the
Trustee.
SECTION 11.03. Persons Entitled to Vote at Meetings
To be entitled to vote at any meeting of Holders of Securities of one or
more, or all, series, a person shall be (a) a Holder of one or more outstanding
Securities of such series, or (b) a person appointed by an instrument in writing
as proxy for a Holder or Holders of one or more outstanding Securities of such
series by such Holder or Holders. The only persons who shall be entitled to
attend any meeting of Holders of Securities of any series shall be the persons
entitled to vote at such meeting and their counsel, any representatives of the
Trustee and its counsel and any representatives of the Company and its counsel.
SECTION 11.04. Quorum; Action
The persons entitled to vote a majority in aggregate principal amount of
the outstanding Securities of the series with respect to which a meeting shall
have been called as hereinbefore provided, considered as one class, shall
constitute a quorum for a meeting of Holders or Securities of such series;
provided, however, that if any action is to be taken at such meeting which this
Indenture expressly provides may be taken by the Holders of a specified
percentage, which is less than majority, in principal amount of the outstanding
Securities of such series, considered as one class, the persons entitled to vote
such specified percentage in principal amount of the outstanding Securities of
such series considered as one class, shall constitute a quorum. In the absence
of a quorum within one hour of the time appointed for any such meeting, the
meeting shall, if convened at the request of Holders of Securities of such
series, be dissolved. In any other case, the meeting may be adjourned for such
period as may be determined by the chairman of the meeting prior to the
adjournment of such meeting. In the absence of a quorum at any such adjourned
meeting, such adjourned meeting may be further adjourned for such period as may
be determined by the chairman of the meeting prior to the adjournment of such
adjourned meeting. Except as provided by Section 11.05(e), notice of the
reconvening of any meeting adjourned for more than thirty (30) days shall be
given not less than ten (10) days prior to the date on which the meeting is
scheduled to be reconvened. Notice of the reconvening of an adjourned meeting
shall state expressly the percentage, as provided above, of the principal amount
of the outstanding Securities of such series which shall constitute a quorum.
Any resolution presented to a meeting or adjourned meeting duly
reconvened at which a quorum is present as aforesaid may be adopted only by the
affirmative vote of the Holders of a majority in aggregate principal amount of
the outstanding Securities of the series with respect to which such meeting
shall have been called, considered as one class; provided, however, that, except
as so limited, any resolution with respect to any action which this Indenture
expressly
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provides may be taken by the Holders of a specified percentage, which is less
than a majority, in principal amount of the outstanding Securities of such
series, considered as one class, may be adopted at a meeting or an adjourned
meeting duly reconvened and at which a quorum is present as aforesaid by the
affirmative vote of the Holder of such specified percentage in principal amount
of the outstanding Securities of such series, considered as one class.
Any resolution passed or decision taken at any meeting of Holders of
Securities duly held in accordance with this Section shall be binding on all the
Holders of Securities of the series with respect to which such meeting shall
have been held, whether or not present or represented at the meeting.
SECTION 11.05. Attendance at Meeting; Determination of Voting Rights; Conduct
and Adjournment of Meetings
(a) Attendance at meetings of Holders of Securities may be in person or by
proxy; and to the extent permitted by law, any such proxy shall remain
in effect and be binding upon any future Holder of the Securities with
respect to which it was given unless and until specifically revoked by
the Holder or future Holder of such Securities before being voted.
(b) Notwithstanding any other provisions of this Indenture, the Trustee may
make such reasonable regulations as it may deem advisable for any
meeting of Holders of Securities in regard to proof of the holding of
such Securities and of the appointment of proxies and in regard to the
appointment and duties of inspectors of votes, the submission and
examination of proxies, certificates and other evidence of the right to
vote, and such other matters concerning the conduct of the meeting as it
shall deem appropriate. Except as otherwise permitted or required by any
such regulations and approved by the Company, the holding of Securities
shall be proved in the manner specified in Section 12.04 and the
appointment of any proxy shall be proved in the manner specified in
Section 12.04. Such regulations may provide that written instruments
appointing proxies, regular on their face, may be presumed valid and
genuine without the proof specified in Section 12.04 or other proof.
(c) The Trustee shall, by an instrument in writing, appoint a temporary
chairman of the meeting, unless the meeting shall have been called by
the Company or by Holders as provided in Section 11.02(b), in which case
the Company or the Holders of Securities of the series calling the
meeting, as the case may be, shall in like manner appoint a temporary
chairman. A permanent chairman and a permanent secretary of the meeting
shall be elected by vote of the persons entitled to vote a majority in
aggregate principal amount of the outstanding Securities of all series
represented at the meeting, considered as one class.
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(d) At any meeting each Holder or proxy shall be entitled to one vote for
each $1,000 principal amount of outstanding Securities held or
represented by such Holder; provided, however, that no vote shall be
cast or counted at any meeting in respect of any Security challenged as
not outstanding and ruled by the chairman of the meeting to be not
outstanding. The chairman of the meeting shall have no right to vote,
except as a Holder of a Security or proxy.
(e) Any meeting duly called pursuant to Section 11.02 at which a quorum is
present may be adjourned from time to time by persons entitled to vote a
majority in aggregate principal amount of the outstanding Securities of
all series represented at the meeting, considered as one class; and the
meeting may be held as so adjourned without further notice.
SECTION 11.06. Counting Votes and Recording Action of Meetings
The vote upon any resolution submitted to any meeting of Holders shall
be by written ballots on which shall be subscribed the signatures of the Holders
or their representatives by proxy and the principal amounts and serial numbers
of the outstanding Securities, of the series with respect to which the meeting
shall have been called, held or represented by them. The permanent chairman of
the meeting shall appoint two inspectors of votes who shall count all votes cast
at the meeting for or against any resolution and who shall make and file with
the secretary of the meeting their verified written reports of all votes cast at
the meeting. A record in duplicate of the proceedings of each meeting of Holders
shall be prepared by the secretary of the meeting and there shall be attached to
such record the original reports of the inspectors of votes on any vote by
ballot taken thereat and affidavits by one or more persons having knowledge and
the facts setting forth a copy of the notice of the meeting and showing that
such notice was given and provided in Section 11.02 and, if applicable, Section
11.04. Each copy shall be signed and verified by the affidavits of the permanent
chairman and secretary of the meeting and one such copy shall be delivered to
the Company and another to the Trustee to be preserved by the Trustee, the
latter to have attached thereto the ballots voted at the meeting. Any record so
signed and verified shall be conclusive evidence of the matters therein stated.
SECTION 11.07. Action without Meeting
In lieu of a vote of Holders at a meeting as hereinbefore contemplated
in this Article, any request, demand, authorization, direction, notice, consent,
waiver or other action may be made, given or taken by Holders by written
instruments as provided in Section 12.04.
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ARTICLE 12
MISCELLANEOUS
SECTION 12.01. Trust Indenture Act Controls
If any provision of this Indenture limits, qualifies or conflicts with
the duties imposed by operation of TIA Section 318(c), the TIA imposed duties
shall control.
SECTION 12.02. Notices
Any notice or communication shall be in writing and delivered in person
or mailed by first-class mail addressed as follows:
if to the Company: Conectiv
800 King Street
Wilmington, DE 19899
Attention: Corporate Secretary
if to the Trustee:
The Company or the Trustee by notice to the other may designate
additional or different addresses for subsequent notices or communications.
Any notice or communication mailed to a Securityholder shall be mailed
to the Securityholder at the Securityholder's address as it appears on the
registration books of the Registrar and shall be sufficiently given if so mailed
within the time prescribed.
Failure to mail a notice or communication to a Securityholder or any
defect in it shall not affect its sufficiency with respect to other
Securityholders. If a notice or communication is mailed in the manner provided
above, it is duly given, whether or not the addressee receives it.
SECTION 12.03. Communication by Holders with Other Holders
Securityholders may communicate pursuant to TIA Section 312(b) with
other Securityholders with respect to their rights under this Indenture or the
Securities. The Company, the Trustee, the Registrar and anyone else shall have
the protection of TIA Section 312(c).
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SECTION 12.04. Acts of Holders
(a) Any request, demand, authorization, direction, notice, consent,
election, waiver or other action provided by this Indenture to be made,
given or taken by Holders may be embodied in and evidenced by one or
more instruments of substantially similar tenor signed by such Holders
in person or by an agent duly appointed in writing or, alternatively,
may be embodied in and evidenced by the record of Holders duly called
and held in accordance with the provisions of Article 11, or a
combination of such instruments and any such record. Except as herein
otherwise expressly provided, such action shall become effective when
such instruments and any such record. Except as herein otherwise
expressly provided, such action shall become effective when such
instrument or instruments or record or both are delivered to the Trustee
and, where it is hereby expressly required, to the Company. Such
instrument or instruments and any such record (and the action embodied
therein and evidenced thereby) are herein sometimes referred to as the
"Act" of the Holders signing such instrument or instruments and so
voting at any such meeting. Proof of execution of any such instruments
or of a writing appointing any such agent, or of the holding by any
person of a Security, shall be sufficient for any purpose of this
Indenture and (subject to Section 6.01) conclusive in favor of the
Trustee and the Company, if made in the manner provided in this Section.
The record of any meeting of Holders shall be proved in the manner
provided in Section 11.06.
(b) The fact and date of the execution by any person of any such instrument
or writing may be proved by the affidavit of a witness of such execution
or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual
signing such instrument or writing acknowledged to him the execution
thereof or may be proved in any other manner which the Trustee and the
Company deem sufficient. Where such execution is by a signer acting in a
capacity other than his individual capacity, such certificate or
affidavit shall also constitute sufficient proof of his authority.
(c) The ownership, principal amount and serial numbers of Securities held by
any person, and the date of holding the same, shall be proved by the
register maintained by the Registrar.
(d) Any request, demand, authorization, direction, notice, consent,
election, waiver or other Act of a Holder shall bind every future Holder
of the same Security and the Holder of every Security issued upon the
registration of transfer thereof or in exchange therefor or in lieu
thereof in respect of anything done, omitted or suffered to be done by
the Trustee or the Company in reliance thereon, whether or not notation
of such action is made upon such Security.
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(e) Until such time as written instruments shall have been delivered to the
Trustee with respect to the requisite percentage of principal amount of
Securities for the action contemplated by such instruments, any such
instrument executed and delivered by or on behalf of a holder may be
revoked with respect to any or all of such Securities by written notice
by such Holder or any subsequent Holder, proven in the manner in which
such instrument was proven.
(f) Securities of any series authenticated and delivered after any Act of
Holders may, and shall if required by the Trustee, bear a notation in
form approved by the Trustee as to any action taken by such Act of
Holders. If the Company shall so determine, new Securities of any series
so modified as to conform, in the opinion of the Trustee and the
Company, to such action may be prepared and executed by the Company and
authenticated and delivered by the Trustee in exchange for outstanding
Securities of such series.
(g) The Company may, at its option, by Company Order, fix in advance a
record date for the determination of Holders entitled to give any
request, demand, authorization, direction, notice, consent, waiver or
other Act solicited by the Company, but the Company shall have no
obligation to do so; provided, however, that the Company may not fix a
record date for the giving or making of any notice, declaration, request
or direction referred to in the next sentence. In addition, the Trustee
may, at its option, fix in advance a record date for the determination
of Holders of Securities of any series entitled to join in the giving or
making of any Notice of Default, any declaration of acceleration
referred to in Section 5.02, any request to institute proceedings
referred to in Section 5.05 or any direction referred to in Section
5.06, in each case with respect to Securities of such series. If any
such record date is fixed, such request, demand, authorization,
direction, notice, consent, waiver or other Act, or such notice,
declaration, request or direction, may be given before or after such
record date, but only the Holders of record at the close of business on
the record date shall be deemed to be Holders for the purposes of
determining, subject to Section 12.07 (i) whether holders of the
requisite proportion of the Securities have authorized or agreed or
consented to such Act and/or (ii) which Holders may revoke any such Act
(notwithstanding subsection (e) of this Section); and any such Act,
given as aforesaid, shall be effective whether or not the Holders which
authorized or agreed or consented to such Act remain Holders after such
record date and whether or not the Securities held by such Holders
remain outstanding after such record date.
SECTION 12.05. Certificate and Opinion as to Conditions Precedent
Upon any request or application by the Company to the Trustee to take or
refrain from taking any action under this Indenture, the Company shall furnish
to the Trustee:
(1) an Officer's Certificate in form and substance reasonably satisfactory
to the Trustee stating that, in the opinion of the signers, all
conditions precedent, if any, provided for in this Indenture (including
any covenants compliance with which constitutes a condition precedent)
relating to the proposed action have been complied with; and
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(2) an Opinion of Counsel in form and substance reasonably satisfactory to
the Trustee stating that, in the opinion of such counsel, all such
conditions precedent have been complied with.
SECTION 12.06. Statements Required in Certificate or Opinion
Each certificate or opinion with respect to compliance with a covenant
or condition provided for in this Indenture shall include:
(1) a statement that the person making such certificate or opinion has read
such covenant or condition;
(2) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of such person, he has made such
examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or condition has
been complied with; and
(4) a statement as to whether or not, in the opinion of such person, such
covenant or condition has been complied with.
SECTION 12.07. When Securities Disregarded
In determining whether the Holders of the required principal amount of
Securities have concurred in any direction, waiver or consent, Securities owned
by the Company or by any person directly or indirectly controlling or controlled
by or under direct or indirect common control with the Company shall be
disregarded and deemed not to be outstanding, except that, for the purpose of
determining whether the Trustee shall be protected in relying on any such
direction, waiver or consent, only Securities which the Trustee knows are so
owned shall be so disregarded. Also, subject to the foregoing, only Securities
outstanding at the time shall be considered in any such determination.
SECTION 12.08. Rules by Trustee, Paying Agent and Registrar
The Trustee may make reasonable rules for action by or a meeting of
Securityholders or for evidencing the due execution of consents or waivers by
Securityholders. The Registrar and the Paying Agent may make reasonable rules
for their functions.
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SECTION 12.09. Legal Holidays
A "Legal Holiday" is a Saturday, a Sunday or a day on which banking
institutions are not required to be open in the State of New York. If a payment
date is a Legal Holiday, payment shall be made on the next succeeding day that
is not a Legal Holiday, and no interest shall accrue for the intervening period.
If a regular record date is a Legal Holiday, the record date shall not be
affected.
SECTION 12.10. Governing Law
This Indenture and the Securities shall be governed by, and construed in
accordance with, the laws of the State of New York but without giving effect to
applicable principles of conflicts of law to the extent that the application of
the laws of another jurisdiction would be required thereby.
SECTION 12.11. No Recourse Against Others
A director, officer, employee or stockholder, as such, of the Company
shall not have any liability for any obligations of the Company under the
Securities of this Indenture or for any claim based on, in respect of or by
reason of such obligations or their creation. By accepting a Security, each
Securityholder shall waive and release all such liability. The waiver and
release shall be part of the consideration for the issue of the Securities.
SECTION 12.12. Successors
All agreements of the Company in this Indenture and the Securities shall
bind its successors. All agreements of the Trustee in this Indenture shall bind
its successors.
SECTION 12.13. Multiple Originals
The parties may sign any number of copies of this Indenture. Each signed
copy shall be an original, but all of them together represent the same
agreement. One signed copy is enough to prove this Indenture.
SECTION 12.14 Table of Contents; Headings
The table of contents and headings of the Articles and Sections of this
Indenture have been inserted for convenience of reference only, are not intended
to be considered a part hereof and shall not modify or restrict any of the terms
or provisions hereof.
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IN WITNESS WHEREOF, the parties have caused this Indenture to be duly
executed as of the date first written above.
CONECTIV
Attest:
by
Title: Title:
_______________________, AS TRUSTEE
Attest:
by
Title: Title:
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STATE OF DELAWARE
ss.:
COUNTY OF NEW CASTLE
On this ___ day of ________, 199_, before me personally came __________,
to me known, who, being by me duly sworn, did depose and say that he/she resides
at Wilmington, Delaware 19899; that he/she is of CONECTIV, one of the
corporations described in and which executed the foregoing instrument; that
he/she knows the seal of said corporation; that the seal affixed to said
instrument bearing the corporate name of said corporation is such corporate
seal; that it was so affixed by order of the Board of Directors of said
corporation; and that he/she signed his/her name thereto by like order.
Notary Public
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STATE OF _________________________
ss.:
COUNTY OF ________________________
On the ____ day of _______________, 199__, before me personally came
________________, to me known, who, being by me duly sworn, did depose and say
that he/she resides at _____________________________, and that he/she is an
___________________________ of _______________________, one of the corporations
described in and which executed the foregoing instrument; that he/she knows the
seal of said corporation; that the seal affixed to said instrument bearing the
corporate name of said corporation is such corporate seal; that it was so
affixed by authority of the Board of Directors of said corporation; and that
he/she signed his/her name thereto by like authority.
Notary Public
47
<PAGE> 54
FORM OF DEBENTURE
Unless this certificate is presented by an authorized representative of
The Depository Trust Company (55 Water Street, New York, New York) to the issuer
or its agent for registration of transfer, exchange or payment, and any
certificate issued is registered in the name of Cede & Co. or such other name as
requested by an authorized representative of The Depository Trust Company and
any payment is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL since the registered owner
hereof, Cede & Co., has an interest herein.
CONECTIV
____% DEBENTURE, SERIES DUE _______
NO. __________________ $ __________
CONECTIV, a Delaware corporation (hereinafter called the Company), for
value received, hereby promises to pay to ____________ or registered assigns,
the sum of $______ on the [_______] day of _______________, at the corporate
trust office of ____________, Trustee under the Indenture referred to on the
reverse hereof, or its successor as such Trustee, in the Borough of Manhattan,
the City of New York, in such coin or currency of the United States of America
as at the time of payment shall be legal tender for the payment of public and
private debts, and to pay interest thereon at the rate of _____% per annum in
like coin or currency, payable at said office semiannually on the [________] day
of ____________ and the [________] day of ____________ in each year, from the
interest payment date to which interest has been paid last preceding the date
hereof (unless the date hereof is an interest payment date to which interest has
been paid, in which case from the date hereof, or unless the date hereof is
prior to ____________, in which case from __________) until the Company's
obligation with respect to the payment of such principal shall have been
discharged, such interest to be paid to the person who shall have been the
registered owner hereof at the close of business on __________ or __________, as
the case may be, next preceding an interest payment date, except as otherwise
provided in the Indenture referred to on the reverse hereof. Notwithstanding the
foregoing, if the date of this Debenture is after __________ or __________, as
the case may be, and before the immediately following __________ or __________,
as the case may be, this Debenture shall bear interest from such __________ or
__________; provided, however, that if and to the extent that the Company shall
default in the payment of interest due on such __________ or __________, this
Debenture shall bear interest from the next preceding __________ or __________
to which interest has been paid or, if no interest has been paid, from ________.
Additional provisions of this Debenture are contained on the reverse
hereof and such provisions shall for all purposes have the same effect as though
fully set forth at this place. This Debenture shall not be valid or become
obligatory for any purpose until it shall have been authenticated by the
certificate, hereon endorsed, of the Trustee under the Indenture.
48
<PAGE> 55
IN WITNESS WHEREOF, Conectiv, has caused this Debenture to be executed
in its name by the facsimile signature of its Chairman of the Board or its
President or one of its Vice Presidents or its Treasurer, and its corporate seal
to be hereunto affixed, or a facsimile thereof to be printed or engraved hereon,
and to be attested by the facsimile signature of its Secretary or one of its
Assistant Secretaries.
CONECTIV
Dated: ____________________________
By: _______________________________
Attest: ___________________________
(FORM OF TRUSTEE'S CERTIFICATE ON DEBENTURES)
This is one of the Debentures, of the series designated therein,
described in the within-mentioned Indenture.
_____________________________, as Trustee,
By
Authorized Officer
49
<PAGE> 56
[REVERSE]
CONECTIV
_____% DEBENTURE, SERIES DUE __________
This Debenture is one of a duly authorized issue of Debentures of the
Company issuable in series, and is one of a series known as its ____%
Debentures, Series Due __________ (herein called Debentures Due __________), all
issued and to be issued under an Indenture dated as of __________, in which the
Debentures Due __________ are created and described, all executed between the
Company and __________ (herein called the Trustee), Trustee, to which Indenture
(herein called the Indenture) reference is hereby made for a statement of the
rights thereunder of the Trustee and of the holders of the Debentures, and of
the duties thereunder of the Trustee and of the Company.
The rights and obligations of the Company and of the holders of
Debentures may be changed and modified at the request of the Company by an
indenture or indentures supplemental to the Indenture, executed pursuant to the
consent in writing of the holders of at least a majority in principal amount of
the Debentures then outstanding affected by such change or modification, all in
the manner and subject to the limitations set forth in the Indenture, provided
that no such change or modification by such supplemental indenture shall extend
the maturity of, or reduce the rate of interest on, or otherwise modify the
terms of payment of the principal of, or the premium, if any, or the interest
on, this Debenture, or reduce the percentage of Debentures the holders of which
are required to consent to any such supplemental indenture, or modify the
provision as to the holders of any series of Debentures authorized or required
to consent to any such supplemental indenture, without the express consent of
the holder hereof. Any such consent by the holder of this Debenture (unless
effectively revoked as provided in the Indenture) shall be conclusive and
binding upon such holder and upon all future holders and owners of this
Debenture, whether or not any notation of such consent is made upon this
Debenture.
[The Debentures Due ________________ may not be redeemed prior to maturity.]
50
<PAGE> 57
[The Debentures Due _____________ may be redeemed, prior to maturity, at the
election of the Company, as a whole at any time, or in part from time to time,
as provided in the Indenture, at the redemption prices (expressed in percentages
of principal amount) set forth in the tabulation below under the heading
"Regular Redemption Prices":]
IF REDEEMED DURING REGULAR
12 MONTH PERIOD REDEMPTION
COMMENCING PRICES
---------- ------
In case a default, as defined in the Indenture, shall occur, the
principal of all the Debentures then outstanding may become or be declared due
and payable in the manner and with the effect provided in the Indenture. The
Indenture provides that in certain events such declaration and certain defaults
under the Indenture may be waived by the holders of a majority in principal
amount of all Securities outstanding under the Indenture.
Except as stated in the first paragraph on the face hereof, this
Debenture is transferable and exchangeable as prescribed in the Indenture by the
registered holder hereof in person, or by his duly authorized attorney, at the
corporate trust office of the Trustee in said Borough of Manhattan, upon
surrender and cancellation of this Debenture, and, thereupon, a new fully
registered Debenture or Debentures Due ______________ of the same aggregate
principal amount shall be issued in exchange therefor as provided in the
Indenture. Except as stated in the first paragraph on the face hereof, the
Company and the Trustee may deem and treat the person in whose name this
Debenture is registered as the absolute owner hereof for the purpose of
receiving payment of or on account of the principal, premium, if any, and
interest due hereon and for all other purposes.
No recourse shall be had for the payment of the principal of, or the
premium, if any, or the interest on, this Debenture, or any part hereof, or for
any claim based hereon or otherwise in respect hereof, or of the indebtedness
represented hereby, or upon any obligation, covenant or agreement of the
Indenture, against any incorporator, stockholder, officer or director, as such,
past, present or future, of the Company or of any successor corporation (either
directly or through the Company or any such successor corporation), whether by
virtue of any constitutional provision, statute or rule of law, or by the
enforcement of any assessment or penalty or otherwise, all liability, if any, of
that character against every such incorporator, stockholder, officer and
director being by the acceptance hereof, and as part of the consideration for
the issue hereof, expressly waived and released.
This Debenture shall be deemed to be a contract made under the laws of
the State of New York and for all purposes shall be construed in accordance with
and governed by the laws of said State.
51
<PAGE> 58
FORM OF MEDIUM-TERM NOTE
Unless this certificate is presented by an authorized representative of
The Depository Trust Company (55 Water Street, New York, New York) to the issuer
or its agent for registration of transfer, exchange or payment, and any
certificate issued is registered in the name of Cede & Co. or such other name as
requested by an authorized representative of The Depository Trust Company and
any payment is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL since the registered owner
hereof, Cede & Co., has an interest herein.
CONECTIV
MEDIUM-TERM NOTE, SERIES
NO.____________________ $___________
Original Issue Date: Redeemable: Yes___ No___
Interest Rate: Initial Redemption Date:
Stated Maturity Date: Redemption Limitation Date:
Issue Price (_____%) Initial Redemption Price:
Interest Payment Dates Reduction Percentage
Regular Record Dates
CONECTIV, a Delaware corporation (hereinafter called the Company), for
value received, hereby promises to pay to __________ or registered assigns, the
sum of $______ on the [______] day of __________, at the corporate trust office
of __________, Trustee under the Indenture referred to on the reverse hereof, or
its successor as such Trustee, in the Borough of Manhattan, the City of New
York, in such coin or currency of the United States of America as at the time of
payment shall be legal tender for the payment of public and private debts, and
to pay interest thereon at the rate of ____% per annum in like coin or currency,
payable at said office semiannually on the [______] day of __________ and the
[______] day of __________ in each year, from the interest payment date to which
interest has been paid last preceding the date hereof (unless the date hereof is
an interest payment date to which interest has been paid, in which case from the
date hereof, or unless the date hereof is prior to __________, in which case
from __________) until the Company's obligation with respect to the payment of
such principal shall have been discharged, such interest to be paid to the
person who shall have been the registered owner hereof at the close of business
on __________ or __________, as the case may be, next preceding an interest
payment date, except as otherwise provided in the Indenture referred to on the
reverse hereof. Notwithstanding the foregoing, if the date of this Medium-Term
Note is after __________ or __________, as the case may be, and before the
immediately following __________ or __________, as the case may be, this
Medium-Term Note shall bear interest from such __________ or __________;
provided, however, that if and to the extent that the Company shall default in
the payment of interest due on such __________ or __________, this Medium-Term
Note shall bear interest from the next preceding __________ or __________ to
which interest has been paid or, if no interest has been paid, from __________.
52
<PAGE> 59
Additional provisions of this Medium-Term Note are contained on the
reverse hereof and such provisions shall for all purposes have the same effect
as though fully set forth at this place. This Medium-Term Note shall not be
valid or become obligatory for any purpose until it shall have been
authenticated by the certificate, hereon endorsed, of the Trustee under the
Indenture.
53
<PAGE> 60
IN WITNESS WHEREOF, Conectiv, has caused this Medium-Term Note to be
executed in its name by the facsimile signature of its Chairman of the Board or
its President or one of its Vice Presidents or its Treasurer, and its corporate
seal to be hereunto affixed, or a facsimile thereof to be printed or engraved
hereon, and to be attested by the facsimile signature of its Secretary or one of
its Assistant Secretaries.
CONECTIV
Dated: ____________________________
By: _______________________________
Attest: ___________________________
(FORM OF TRUSTEE'S CERTIFICATE ON MEDIUM-TERM NOTES)
This is one of the Medium-Term Notes, of the series designated therein,
described in the within-mentioned Indenture.
_____________________________, as Trustee,
By
Authorized Officer
54
<PAGE> 61
[REVERSE]
CONECTIV
MEDIUM-TERM NOTE, SERIES ______
This Medium-Term Note is one of a duly authorized issue of Medium-Term
Notes of the Company issuable in series, and is one of a series known as its
Medium-Term Notes, Series ______ (herein called Medium-Term Notes, Series
______), all issued and to be issued under an Indenture dated as of __________,
in which the Medium-Term Notes, Series __________ are created and described, all
executed between the Company and _______________ (herein called the Trustee),
Trustee, to which Indenture (herein called the Indenture) reference is hereby
made for a statement of the rights thereunder of the Trustee and of the holders
of the Medium-Term Notes, and of the duties thereunder of the Trustee and of the
Company.
The rights and obligations of the Company and of the holders of
Medium-Term Notes may be changed and modified at the request of the Company by
an indenture or indentures supplemental to the Indenture, executed pursuant to
the consent in writing of the holders of at least a majority in principal amount
of the Medium-Term Notes then outstanding affected by such change or
modification, all in the manner and subject to the limitations set forth in the
Indenture, provided that no such change or modification by such supplemental
indenture shall extend the maturity of, or reduce the rate of interest on, or
otherwise modify the terms of payment of the principal of, or the premium, if
any, or the interest on, this Medium-Term Note, or reduce the percentage of
Medium-Term Notes the holders of which are required to consent to any such
supplemental indenture, or modify the provision as to the holders of any series
of Medium-Term Notes authorized or required to consent to any such supplemental
indenture, without the express consent of the holder hereof. Any such consent by
the holder of this Medium-Term Note (unless effectively revoked as provided in
the Indenture) shall be conclusive and binding upon such holder and upon all
future holders and owners of this Medium-Term Note, whether or not any notation
of such consent is made upon this Medium-Term Note.
[The Medium-Term Notes, Series ________ may not be redeemed prior to maturity.]
55
<PAGE> 62
[The Medium-Term Notes, Series ______ may be redeemed, prior to maturity, at the
election of the Company, as a whole at any time, or in part from time to time,
as provided in the Indenture, at the redemption prices (expressed in percentages
of principal amount) set forth in the tabulation below under the heading
"Regular Redemption Prices":]
IF REDEEMED DURING REGULAR
12 MONTH PERIOD REDEMPTION
COMMENCING PRICES
---------- ------
In case a default, as defined in the Indenture, shall occur, the
principal of all the Medium-Term Notes then outstanding may become or be
declared due and payable in the manner and with the effect provided in the
Indenture. The Indenture provides that in certain events such declaration and
certain defaults under the Indenture may be waived by the holders of a majority
in principal amount of all Securities outstanding under the Indenture.
Except as stated in the first paragraph on the face hereof, this
Medium-Term Note is transferable and exchangeable as prescribed in the Indenture
by the registered holder hereof in person, or by his duly authorized attorney,
at the corporate trust office of the Trustee in said Borough of Manhattan, upon
surrender and cancellation of this Medium-Term Note, and, thereupon, a new fully
registered Medium-Term Note or Medium-Term Notes, Series ______ of the same
aggregate principal amount shall be issued in exchange therefor as provided in
the Indenture. Except as stated in the first paragraph on the face hereof, the
Company and the Trustee may deem and treat the person in whose name this
Medium-Term Note is registered as the absolute owner hereof for the purpose of
receiving payment of or on account of the principal, premium, if any, and
interest due hereon and for all other purposes.
No recourse shall be had for the payment of the principal of, or the
premium, if any, or the interest on, this Medium-Term Note, or any part hereof,
or for any claim based hereon or otherwise in respect hereof, or of the
indebtedness represented hereby, or upon any obligation, covenant or agreement
of the Indenture, against any incorporator, stockholder, officer or director, as
such, past, present or future, of the Company or of any successor corporation
(either directly or through the Company or any such successor corporation),
whether by virtue of any constitutional provision, statute or rule of law, or by
the enforcement of any assessment or penalty or otherwise, all liability, if
any, of that character against every such incorporator, stockholder, officer and
director being by the acceptance hereof, and as part of the consideration for
the issue hereof, expressly waived and released.
This Medium-Term Note shall be deemed to be a contract made under the
laws of the State of New York and for all purposes shall be construed in
accordance with and governed by the laws of said State.
56
<PAGE> 1
Page 1 Exhibit A-3
NUMBER SHARES
COMMON STOCK COMMON STOCK
PAR VALUE $.01 PER SHARE PAR VALUE $.01 PER SHARE
INCORPORATED UNDER THE LAWS CUSIP 206829 10 3
OF THE STATE OF DELAWARE SEE REVERSE FOR CERTAIN DEFINITIONS
CONECTIV
This Certifies that
is the owner of
SHARES OF THE FULL-PAID AND NON-ASSESSABLE COMMON STOCK OF
Conectiv, transferable in person or by duly authorized attorney upon surrender
of this Certificate properly endorsed. This Certificate and the shares
represented hereby are issued and shall be held subject to the provisions of he
Certificate of Incorporation of the Company. This Certificate is not valid
unless countersigned by a Transfer Agent registered by a Registrar.
Witness the seal of the Company and the signatures of its duly
authorized officers.
CERTIFICATE OF STOCK
Dated
COUNTER SIGNED AND REGISTERED:
THE BANK OF NEW YORK
L.M. Walters H.E. Cosgrove William J. Skinner
TREASURER CHAIRMAN TRANSFER AGENT AND REGISTRAR
[SEAL]
AMERICAN BANK NOTE COMPANY
z
<PAGE> 2
Page 2
CONECTIV
The Corporation is authorized to issue more than one class of stock,
including a class of preferred stock that may be issued in one or more series.
The Corporation will furnish to any stockholder, without charge and upon written
request to the Corporate Secretary, a full statement of the powers,
designations, preferences, and relative, participating, optional, or other
special rights of the shares of each class of stock or series thereof and the
qualifications, limitations and restrictions of such preferences and/or rights.
The following abbreviations, when used in the inscription on the face of
this certificate, shall be construed as thought they were written out in full
according to applicable laws or regulations:
<TABLE>
<S> <C> <C>
TEN COM - as tenants in common UNIF GIFT MIN ACT - ______ Custodian _______
TEN ENT - as tenants by the entireties (Cust) (Minor)
JT TEN - as joint tenants with right of under Uniform Gifts
survivorship and not as tenants to Minors Act _________
in common (State)
</TABLE>
Additional abbreviations may also be used though not in the above list.
For value received, ______________________ hereby sell, assign and transfer unto
PLEASE INSERT SOCIAL SECURITY OR
OTHER IDENTIFYING NUMBER OF ASSIGNEE
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Please print or typewrite name and address including postal zip code of assignee
________________________________________________________________________________
________________________________________________________________________________
_________________________________________________________________________ shares
of the capital stock represented by the within Certificate, and do hereby
irrevocably constitute and appoint _____________________________________________
________________________________________________________________________________
Attorney to transfer the said stock on the books of the within-named Company
with full power of substitution in the premises.
Dated, ___________________
________________________________________
NOTICE: THE SIGNATURE TO THIS ASSIGNMENT
MUST CORRESPOND WITHT HE NAME AS
WRIT-TEN UPON THE FACE OF THE
CERTIFICATE, IN EVERY PARTICULAR,
WITHOUT ALTERATION OR ENLARGEMENT, OR
ANY CHANGE WHATEVER.
SIGNATURE(S) GUARANTEED: ________________________________________________
THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN
ELIGIBLE GUARANTOR INSTITUTION (BANKS,
STOCK-BROKERS, SAVINGS AND LOAN ASSOCIATIONS AND
CREDIT UNIONS WITH MEMBERSHIP IN AN APPROVED
SIGNATURE GUARANTEE MEDALLION PROGRAM), PURSUANT
TO S.E.C. RULE 17Ad-15.
KEEP THIS CERTIFICATE IN A SAFE PLACE. IF IT IS LOST, STOLEN, MUTILATED OR
DESTROED, THE CORPORATION WILL REQUIRE A BOND IF INDEMNITY AS A CONDITION TO THE
ISSUANCE OF A REPLACEMENT CERTIFICATE.
<PAGE> 3
Page 3
NUMBER SHARES
CLASS A CLASS A
COMMON STOCK COMMON STOCK
PAR VALUE $.01 PER SHARE PAR VALUE $.01 PER SHARE
INCORPORATED UNDER THE LAWS CUSIP 206829 20 2
OF THE STATE OF DELAWARE SEE REVERSE FOR CERTAIN DEFINITIONS
CONECTIV
This Certifies that
is the owner of
SHARES OF THE FULL-PAID AND NON-ASSESSABLE COMMON STOCK OF
Conectiv, transferable in person or by duly authorized attorney upon surrender
of this Certificate properly endorsed. This Certificate and the shares
represented hereby are issued and shall be held subject to the provisions of he
Certificate of Incorporation of the Company. This Certificate is not valid
unless countersigned by a Transfer Agent registered by a Registrar.
Witness the seal of the Company and the signatures of its duly
authorized officers.
CERTIFICATE OF STOCK
Dated
COUNTER SIGNED AND REGISTERED:
THE BANK OF NEW YORK
L.M. Walters H.E. Cosgrove William J. Skinner
TREASURER CHAIRMAN TRANSFER AGENT AND REGISTRAR
[SEAL]
AMERICAN BANK NOTE COMPANY
<PAGE> 4
CONECTIV
The Corporation is authorized to issue more than one class of stock,
including a class of preferred stock that may be issued in one or more series.
The Corporation will furnish to any stockholder, without charge and upon written
request to the Corporate Secretary, a full statement of the powers,
designations, preferences, and relative, participating, optional, or other
special rights of the shares of each class of stock or series thereof and the
qualifications, limitations and restrictions of such preferences and/or rights.
The following abbreviations, when used in the inscription on the face of
this certificate, shall be construed as thought they were written out in full
according to applicable laws or regulations:
<TABLE>
<S> <C> <C>
TEN COM - as tenants in common UNIF GIFT MIN ACT - ______ Custodian ______
TEN ENT - as tenants by the entireties (Cust) (Minor)
JT TEN - as joint tenants with right of under Uniform Gifts
survivorship and not as tenants to Minors Act _______
in common (State)
</TABLE>
Additional abbreviations may also be used though not in the above list.
For value received, ______________________ hereby sell, assign and transfer unto
PLEASE INSERT SOCIAL SECURITY OR
OTHER IDENTIFYING NUMBER OF ASSIGNEE
________________________________________________________________________________
________________________________________________________________________________
Please print or typewrite name and address including postal zip code of assignee
________________________________________________________________________________
________________________________________________________________________________
_________________________________________________________________________ shares
of the capital stock represented by the within Certificate, and do hereby
irrevocably constitute and appoint _____________________________________________
________________________________________________________________________________
Attorney to transfer the said stock on the books of the within-named Company
with full power of substitution in the premises.
Dated, __________________
________________________________________
NOTICE: THE SIGNATURE TO THIS ASSIGNMENT
MUST CORRESPOND WITHT HE NAME AS
WRIT-TEN UPON THE FACE OF THE
CERTIFICATE, IN EVERY PARTICULAR,
WITHOUT ALTERATION OR ENLARGEMENT, OR
ANY CHANGE WHATEVER.
SIGNATURE(S) GUARANTEED: ________________________________________________
THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN
ELIGIBLE GUARANTOR INSTITUTION (BANKS,
STOCK-BROKERS, SAVINGS AND LOAN ASSOCIATIONS AND
CREDIT UNIONS WITH MEMBERSHIP IN AN APPROVED
SIGNATURE GUARANTEE MEDALLION PROGRAM), PURSUANT
TO S.E.C. RULE 17Ad-15.
KEEP THIS CERTIFICATE IN A SAFE PLACE. IF IT IS LOST, STOLEN, MUTILATED OR
DESTROED, THE CORPORATION WILL REQUIRE A BOND IF INDEMNITY AS A CONDITION TO THE
ISSUANCE OF A REPLACEMENT CERTIFICATE.
<PAGE> 1
EXHIBIT A-5
[FORM OF BID NOTE AGREEMENT*]
[Date]
Conectiv
800 King Street
Wilmington, DE 19899
Attention:
Re: Uncommitted Credit Facility for Bid Notes
Ladies/Gentlemen:
We are pleased to make available to you an uncommitted credit facility
for general corporate purposes on the terms set forth in this letter (the
"Letter Agreement).
1. We agree to consider from time to time your requests that we make advances
to you, on either an interest bearing or a discount basis ("Advances"), in
an aggregate amount not to exceed at any one time outstanding the amount set
forth on Schedule I hereto as the "Facility Amount", on the terms and
conditions set forth below. This is not a committed line of credit and
Advances hereunder, if any, shall be made by us in our sole desecration.
Nothing contained herein or any other documents executed or delivered
herewith shall be construed to obligate us to make any Advances. This Letter
Agreement sets forth the procedures to be used in connection with your
requests for our making of Advances to you from time to time on or prior to
the termination hereof pursuant to paragraph 9 and, in the event that we
make Advances to you hereunder, your obligations to us with respect thereto.
2. The net amount of each Advance shall be in an amount at least equal to the
amount set forth on Schedule I hereto as the "Minimum Advance Amount" and
shall be made upon (i) your request to us by telephone, facsimile or letter,
given by any of the person listed on Exhibit A hereto or otherwise
designated by you in writing ("Designated Persons"), that you wish to borrow
money on a specified date, in a specified amount and for a specified term
(which shall, in no event, be longer than the number of days set forth on
Schedule I hereto as the "Maximum Term"); and (ii) our mutual agreement as
to such date, amount and term and as to the interest rate per annum or, in
the case of an Advance made on a discount basis, discount applicable to any
such Advance. We shall be entitled to rely upon any instruction which we
reasonably believe to have been given by a Designated Person. On the date of
any such Advance, we will make such Advance available to you in same day
funds by directing our administrative agent to transfer or wire the net
proceeds of such Advance to an account designated in writing by a Designated
Person. Promptly after the date of each Advance, our administrative agent
will send you a written confirmation of such Advance and the amount and term
thereof and the interest rate per annum or, in the case of an Advance made
on a discount basis, the discount applicable thereto. We will enter on our
books and records, the date and amount of each Advance, the interest rate
(or as the case may be, the discount basis) and the term applicable thereto,
as well as the date and amount of each payment made by you.
3. Prior to the making of any Advance hereunder, you shall provide us with an
executed copy of this Letter Agreement; evidence of the due authorization by
you of the execution, delivery and performance by you of this Letter
Agreement; and such other instruments as we shall reasonably require in form
and substance satisfactory to us. Your agreement and acceptance of this
Letter Agreement shall constitute a representation and warranty by you that
(a) the execution, delivery and performance by you of this Letter Agreement
has been duly authorized by all necessary corporate action and does not
contravene any law, or any contractual or legal restriction, applicable to
you and (b) no authorization or approval or other action by, and no notice
to or filing with, any governmental authority or regulatory body is required
for such execution, delivery and performance or for the making of any
Advance.
* THIS IS A GENERIC FORM OF BID NOTE AGREEMENT. INDIVIDUAL NOTES ARE NEGOTIATED
WITH EACH LENDER
<PAGE> 2
4. Each request by you for an Advance shall constitute a representation and
warranty by you, as of the making of such Advance and giving effect to the
application of the proceeds therefrom, that (i) you shall have performed and
complied with all agreements and conditions required hereunder, (ii) no
condition or event shall exist which constitutes an Event of Default (as
herein defined) or which, with the passage or time, the giving of notice, or
both, would constitute an Event of Default, (iii) such Advance when made
will constitute your legal, valid and binding obligation, (iv) such Advance
is being incurred, and will be repaid at maturity, in the ordinary course of
our business out of the cash flow generated in the normal day-to-day conduct
and operation of your business, and (v) no event has occurred and no
circumstance exists as a result of which the information which you have
provided to us in connection herewith would include an untrue statement of a
material fact or omit to state any material fact or any fact necessary to
make the statements contained therein, in the light of the circumstances
under which they were made, not misleading.
5. You hereby promise to pay to us or our order with respect to each Advance:
(a) in the case of an Advance made on an interest bearing basis, the
principal amount of such Advance made to you, on the date mutually
agreed to by both parties at the time of such Advance as the maturity
date thereof, together with interest on the principal amount of each
Advance outstanding from time to time from and including the date on
which such Advance is made until the maturity date of such Advance, at
an interest rate per annum mutually agreed to by both parties at the
time of such Advance, payable on the maturity date of such Advance; and
(b) in the case of each Advance made on a discount basis to you, the stated
or face amount of such advance on the date mutually agreed to by both
parties at the time of such Advance as the maturity date thereof.
6. If any Advance or other amount is not paid when due, you shall pay interest
on such amount until is paid in full at a rate per annum (the "Default
Rate") equal to ______ percent ( %) above the [Bank] Prime Rate but not more
than the maximum rate allowed by law. As used herein, "[Bank] Prime Rate"
shall mean the rate publicly announced by the [Bank], as its prime rate. The
[Bank] Prime Rate is determined from time to time by [Bank] as a means of
pricing some loans to its borrowers.
7. You shall make each payment hereunder in same day funds on or before 12:00
noon (eastern time) on the day when due in lawful money or the United States
of America to Account No. __________ maintained at [Bank]. All computations
of interest shall be made by us on the basis of a year of 360 days, for the
actual number of days (including the first day but excluding the last day)
elapsed.
8. Whenever any payment to be made hereunder shall be otherwise due on a
Saturday, a Sunday or other day of the year on which commercial banks are
required or authorized to close in _________________(any other day being a
"Business Day", Such payment shall be made on the next succeeding Business
Day.
9. This Letter Agreement may be terminated at any time by either you or us by
notice of such termination to the other party hereto, but no such
termination shall affect your obligations with respect to the Advances
hereunder outstanding at the time of such termination.
10. All notices, demands, requests, consents, approvals and other communications
required or permitted hereunder must be in writing and will be effective
upon receipt if delivered personally to such party, or if sent by facsimile
transmission with confirmation of delivery, or by nationally recognized
overnight courier service, to the address specified on Schedule I hereto or
to such other address as any party may give to the other in writing for such
purpose.
11. You may not assign your rights or obligations hereunder or any interest
herein to any person. We may assign to one or more financial institutions or
other entities all or any part of, or may grant participations to one or
more financial institutions or other entities in or to all or any part of,
any Advance or Advances hereunder without your consent and without notice to
you.
12. You agree to pay on demand all costs, expenses (including reasonable fees
and expenses of counsel) and losses, if any, incurred by us in connection
with the enforcement of this Letter Agreement.
13. You agree to furnish us promptly with such financial statements or other
information as we may reasonably request.
<PAGE> 3
14. If any of the following events (each, an "Event of Default") shall occur and
be continuing: (a) you shall fail to pay any amount due hereunder when the
same becomes due and payable; or (b) any representation or warranty made by
your (or any of your officers) in connection with any Advance or otherwise
in connection herewith shall prove to have been false, erroneous or
misleading in any material respect when made; or (c) you shall, without our
prior written consent, merge or consolidate with or into, or convey,
transfer, lease or dispose of (whether in one transaction or in a series of
transactions) all or substantially all of your assets to, any person or
entity; or (d) you shall fail to perform or observe any other material term,
covenant or agreement in connection with any Advance or otherwise in
connection herewith on your part to be performed or observed; or (e) you
shall fail to pay any principal of or premium or interest on any Material
Debt (as that term is defined on Schedule I attached hereto), when the same
becomes due and payable (whether by scheduled maturity, required prepayment,
acceleration, demand or otherwise), and such failure shall continue after
the applicable grace period, if any, specified in the agreement or
instrument relating to such Material Debt; or any other event shall occur or
condition shall exist under any agreement or instrument relating to such
Material Debt and shall continue after the applicable grace period, if any,
specified in such agreement or instrument, if the effect of such event or
condition is to accelerate, or to permit the acceleration of, the maturity
of such Material Debt or any such Material Debt shall be declared to be due
and payable, or required to be prepaid (other than by a regularly scheduled
required prepayment), prior to the stated maturity thereof; or (f) any
material adverse change in your businesses, assets, operations, financial
condition or results of operations; or (g) the entry of a Material Final
Judgment against you and your failure to discharge such Material Final
Judgment with in thirty days of the entry thereof; or (h) you shall
generally not pay your debts as such debts become due, or shall admit in
writing your inability to pay your debts generally, or shall make a general
assignment for the benefit of creditors; or any proceeding shall be
instituted by or against you seeking to adjudicate you as bankrupt or
insolvent or seeking a reorganization for relief of debtors, or seeking the
entry of an order for relief or the appointment of a receiver, trustee,
custodian or other similar official for you or any substantial part of your
property; or you shall take any corporate action to authorize any of the
actions set forth above in this subsection (h); then, upon the occurrence of
any such Event of Default, we may declare all amounts payable hereunder to
be forthwith due and payable, whereupon all such amounts shall become and be
forthwith due and payable, without presentment, demand, protest or further
notice of any kind all of which you hereby expressly waive; provided,
however, that in the event of an actual or deemed entry of an order for
relief with respect to you under the Federal Bankruptcy Code, all such other
amounts shall automatically become and be due and payable, without
presentment, demand, protest or any notice of any kind, all of which are
hereby expressly waived by you.
15. As long as you shall have any Advances outstanding, you agree that you will
maintain separate lines of credit, with one or more commercial banks, in an
unutilized aggregate amount equal to the amount of all outstanding Advances.
16. Our obligations under this Letter Agreement are solely the corporate
obligations of [Bank]. No recourse shall be had for the payment of any
amount owing by the Bank hereunder or any other obligation or claim of or
against the lender arising out of or based upon the Letter Agreement against
any stockholder, employee, officer, director or incorporator of the Lender.
17. This letter agreement will be interpreted and the rights and liabilities of
the parties hereto determined in accordance with the laws of the
______________________________.
18. No modification, amendment or waiver of any provision of this Letter
Agreement nor consent to any departure by you from the terms thereof, will
in any event be effective unless the same is in writing and signed by us,
and then such waiver or consent shall be effective only in the specific
instance and for the purpose for which it was given.
19. This Letter Agreement (including the document and instruments referred to
herein) constitutes the entire agreement and supersedes all other prior
agreements and understandings, both written and oral, between the parties
with respect to the subject matter hereof.
20. This Letter Agreement may be signed in any number of counterpart copies and
by the parties hereto on separate counterparts, but all such copies shall
constitute one and the same instrument.
<PAGE> 4
If the terms of this Letter Agreement are satisfactory to you, please
indicate your agreement and acceptance thereof by signing a counterpart of this
Letter Agreement and returning it to us.
Agreed to and Accept Very truly yours,
CONECTIV [BANK]
By: ______________________________ By: _________________________________
Name: ____________________________ Name: _______________________________
Title: ___________________________ Title _______________________________
<PAGE> 5
SCHEDULE I
to
Letter Agreement
dated as of
between [Bank] and
Conectiv
(ii) For the purpose of Sections 1 and 2 of the Letter
Agreement: The "Facility Amount" is $ ______ . The
"Minimum Advance Amount is "$ ______ . The "Maximum Term"
is _____ days.
(ii) For the purpose of Section 11 of this Letter Agreement:
The address for written communication to you is:
Conectiv
800 King Street
Wilmington, Delaware 19899
Attention:
Telephone:
Fax:
The address for written communications to us is:
(iii) For the purpose of Section 15 of this Letter Agreement, the
term "Material Debt" means indebtedness (other than indebtedness
incurred under this Letter Agreement) in an amount in excess of
$ _________________ .
(iv) For the purpose of Section 15 of this Letter Agreement, the
term "Material Final Judgment" means a judgment for damages in excess of
$ _____________ for which all relief and all appeals have been exhausted
and the time for seeking such relief and taking such appeals has
expired.
(v) For purposes of the Letter Agreement, instructions for wire
transfer of funds to you are:
Name:
Bank ABA Number:
Customer Number:
Reference:
<PAGE> 6
EXHIBIT A
to
the Letter Agreement
dated as of ________________
between [Bank] and
Conectiv
For the purpose of Section 2 of the Letter Agreement, the "Designated
Persons" are:
Name Title
_______________________ _______________________
_______________________ _______________________
_______________________ _______________________
_______________________ _______________________
<PAGE> 1
Exhibit A-9
FORM OF MONEY POOL AGREEMENT
This Agreement is executed this day of , 199 , by and between Conectiv
(hereinafter referred to as the "Parent Company"), a Delaware Corporation and a
holding company registered under the terms of the Public Utility Holding Company
Act of 1935 (the "Act"), Conectiv Resource Partners, Inc. (hereinafter referred
to as the "Service Company"), a Delaware corporation and a mutual service
company formed under the terms of the Act and ______________ , ______________ a
corporation and an associate company of the Conectiv system ("Participating
Company", and collectively with other associate companies that have or may in
the future execute this form of Agreement, the "Participating Companies").
WITNESSETH
WHEREAS, the parties hereto desire A) to make excess funds, when and as
such excess funds exist, available for borrowing by other Participating
Companies and B) when in need to be able to borrow excess funds made available
by other Participating Companies and/or by the Parent Company; and
WHEREAS, the Service Company agrees to act as agent for Participating
Companies and the Parent Company for the purpose of receiving excess funds and
either disbursing or investing said funds in accordance with this Agreement; and
WHEREAS, the Parent Company desires, A) to the extent that it has funds
available, to have an expedient vehicle for providing additional short term
funding to meet the needs of Participating Companies wishing to borrow should
the deposits by Participating Companies with excess funds be insufficient and B)
to guarantee the return of deposits made by Participating Companies, and
WHEREAS, economies and efficiencies benefiting the Participating
Companies will result from the operation of the Money Pool as herein provided
and borrowing from nonaffiliates will be minimized:
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein contained, the parties to this Agreement covenant and agree as
follows:
ARTICLE I - Establishment and Operation of Money Pool
Section 1.1 Money Pool Accounts: The Service Company shall establish one
or more banking accounts in which to hold, as agent, funds deposited by the
Parent Company and funds deposited by Participating Companies having excess
funds and use such account(s) to dispense funds to Participating Companies
needing to borrow funds. The portion of the Money Pool account attributable to
an amount deposited by a Participating Company shall be referred to as the
Participating Company's Deposit Balance.
Section 1.2 Deposits and Sources of Funds. Each Participating Company
shall determine daily based on its current cash position, cash flow projections
and other factors as deemed relevant to the officers of the Participating
Company. The Treasurer of the Participating Company or his
<PAGE> 2
designee shall advise the Treasurer of the Service Company or his designee, the
level of funds being deposited or kept on deposit in the Money Pool that day.
The Parent Company may deposit funds needed to meet the requirements of
Participating Companies needing funds. An evidence of deposit in the form
attached hereto as Exhibit A shall be executed by the Service Company to
document its receipt of funds as agent.
Section 1.3. Lending of Funds: The Service Company shall transfer to
Participating Companies needing funds such funds as required. If insufficient
funds are available in the Money Pool to meet the needs of Participating
Companies, the Treasurer of the Service Corporation shall request that the
Parent Company make a deposit equal to the shortfall. Each borrowing company
shall be deemed to have borrowed from each depositing company an amount equal to
the proportion of the depositing company's deposit to the total amount on
deposit in the Money Pool. Nothing in this Agreement restricts the ability of
the Parent Company to lend funds directly to any associate company.
Section 1.4. Loans Repayable Upon Demand. All loans made with Money Pool
deposits shall be repayable upon demand, when and to the extent demand is made
by any Participating Company making a deposit.
Section 1.5. Parent Guarantee of Deposits. Subject to the provisions of
Section 3.1 below, the Parent Company wishes to guarantee the return of deposits
made by any Participating Company by agreeing to make a capital contribution to
any depositing Participating Company if, and only to the extent that, following
demand for repayment, a deposit is not returned to any Participating Company.
Section 1.6. Limitations on Borrowing of Funds. Any Participating
Company may borrow funds deposited in the Money Pool by Participating Companies
with excess funds or by the Parent Company upon execution and delivery to the
Service Company of a Money Pool Note in the form attached hereto as Exhibit B.
Under no circumstances may the Parent Company be a borrower. No funds may be
transferred to the Parent Company in excess of funds previously deposited by,
and not previously returned to, the Parent Company. Borrowing by Delmarva Power
& Light Company and Atlantic City Electric Company shall not exceed the amount
of short-term borrowing authorized by an appropriate state public utility
commission or by the Securities and Exchange Commission ("SEC") under the Act,
if applicable, and borrowing by any other Participating Company shall not exceed
$25 million at any one time outstanding.
Section 1.7. Interest Earned and Interest Paid. All funds deposited in
the Money Pool will earn interest and all funds borrowed from the Money Pool
shall bear interest based on each Participating Company's daily average cash
position. The cost of money for all borrowings from the Money Pool and the
investment rate for all moneys deposited in the Money Pool will be the same.
rate (the "Money Pool Rate"). This rate will be determined by using the interest
expense incurred during the month with respect to external borrowings incurred
by the Parent Company to make deposits in the Money Pool less any interest
income generated by the Money Pool. The total net expense for a month will be
divided by the Money Pool's average net daily investment/borrowing position to
derive the Money Pool Rate for the month. If there are no such external
borrowings nor external investments, then the Money Pool Rate for borrowings
and/or
2
<PAGE> 3
investments will be the prior month's average Federal Funds Rate as published in
the Federal Reserve Statistical Release Publication H.15 (519). Interest will be
allocated for payment by each Participating Company which has borrowed based on
the proportion of the borrowing company's Money Pool debt to the total borrowed
from Participating Companies and/or the Parent Company on any day during the
month. The interest payment shall be made monthly by debit to the borrowing
company's Money Pool Deposit Balance and credit to the lending company's Money
Pool Deposit Balance. Interest earned in excess of interest expense will be
allocated among depositing companies on the basis of the proportion of each
Participating Company's Money Pool Deposit Balance to the total Money Pool
funds.
Section 1.8. Use of Excess Funds. Any funds not required by the Money
Pool to make loans to Participating Companies shall be invested in one or more
short-term investments in accordance with the Conectiv System's Investment
Guidelines as approved from time to time by the Board of Directors of the Parent
Company or by officers of the Parent Company, if such authority is delegated to
such officers by the Parent Company Board of Directors.
Section 1.9. Clearing Affiliate Transactions by Book Entry. Amounts owed
by one Participating Company to another Participating Company may be paid and
payment may be received by debiting the Money Pool Deposit Balance of the
Participating Company making the payment and crediting the Money Pool Deposit
Balance of the Participating Company receiving the payment. Settlement sheets
reflecting all such book entry payments shall be sent to all Participating
Companies promptly.
ARTICLE II - COMPENSATION
Section 2.1. Compensation Based on Cost. As compensation for the
services to be rendered hereunder, each Participating Company shall pay to the
Service Company all costs which reasonably can be identified and related to the
operation of the Money Pool, such cost to be determined, allocated and paid in
accordance with the Service Agreement as approved by the SEC under Section 13 of
the Act and executed by the Parent Company, Participating Companies and the
Service Company.
ARTICLE III - TERM
Section 3.1. Term. This Agreement shall become effective as of the day
of above written, and shall continue in force until terminated by either party.
The Parent Company shall have the right, upon just cause determined in the sole
discretion of the Treasurer of the Parent Company, to declare that deposits
loaned to a particular Participating Company will not qualify for the guarantee
set forth in Section 1.5 above. Any Participating Company whose loans are thus
disqualified will thereafter only be permitted to participate as a depositor and
not as a borrower from the Money Pool. This Agreement shall also be subject to
termination or modification at any time, without notice, if and to the extent
performance under this Agreement may conflict with the Act or with any rule,
regulation or order of the SEC adopted before or after the date of this
Agreement or any other regulatory body.
3
<PAGE> 4
ARTICLE IV - MISCELLANEOUS
Section 4.1. Accounting. All accounts and records of the Service Company
shall be kept in accordance with the General Rules and Regulations promulgated
by the SEC pursuant to the Act, in particular, the Uniform System of Accounts
for Mutual Service Companies and Subsidiary Service Companies in effect from and
after the date hereof, except as specifically approved by the SEC.
Section 4.2. Addition of New Parties. Other existing wholly-owned
subsidiaries and new direct or indirect wholly-owned subsidiaries of the Parent
Company, which may be established after the effective date of this Agreement,
may become additional Participating Companies (collectively, the "New
Participating Companies") subject to this Agreement by execution of this form of
agreement, as it may be amended at that time. In addition, the parties hereto
shall make such changes in the operation of the Money Pool and the method of
assigning, distributing or allocating interest income and interest expense among
the Participating Companies and the New Participating Companies under this
Agreement as may become necessary.
Section 4.3. Access to Books and Records. The Service Company shall
permit a Participating Company access to its accounts and records, including the
basis and computation of allocations.
Section 4.4. Subject to Regulatory Approvals. This Agreement and any
amendments hereto shall not be effective until any necessary regulatory
approvals have been obtained.
Section 4.5. This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the date and year first above written.
CONECTIV as lender and guarantor
By: _________________________________________
[Title]
CONECTIV, RESOURCE PARTNERS, INC.
As Agent on behalf of Participating Companies
By: _________________________________________
[title]
[PARTICIPATING COMPANY]
By: _________________________________________
[title]
4
<PAGE> 1
Exhibit B-1
[NAME OF ISSUER]
COMMON STOCK
STANDARD PURCHASE PROVISIONS
INCLUDING
FORM OF PURCHASE AGREEMENT
[NAME OF ISSUER]
STANDARD PURCHASE PROVISIONS -
COMMON STOCK
From time to time, [Name of Issuer], a corporation organized and
existing under the laws of the State of Delaware (the "Company") may enter into
purchase agreements that provide for the sale of designated securities to the
purchaser or purchasers named therein. The standard provisions set forth herein
may be incorporated by reference in any such purchase agreement (the "Purchase
Agreement"). The Purchase Agreement, including the provisions incorporated
therein by reference, is herein sometimes referred to as "this Agreement." The
term "Common Stock" shall mean the Common Stock of the Company. Unless otherwise
defined herein, terms defined in the Purchase Agreement are used herein as
therein defined.
The Company has filed, in accordance with the provisions of the
Securities Act of 1933, as amended, and the rules and regulations of the
Securities and Exchange Commission thereunder (collectively called the "Act"),
with the Securities and Exchange Commission (the "Commission"), a registration
statement on Form S-3 (including a prospectus), relating to the Company's Common
Stock, which pursuant to Item 12 of Form S-3 incorporates by reference documents
which the Company has filed in accordance with the provisions of the Securities
Exchange Act of 1934, as amended, and the rules and regulations thereunder
(collectively called the "Exchange Act"). Such registration statement has been
declared effective by the Commission. Promptly upon the
<PAGE> 2
execution of this Agreement, the Company will prepare a prospectus supplement
relating to the Common Stock to be sold by the Company pursuant to the
applicable Purchase Agreement (the "Prospectus Supplement"). The Company has
furnished to you, for use by the Underwriters (as defined herein) and dealers,
copies of one or more preliminary prospectuses and the documents so incorporated
therein (each thereof, including the documents so incorporated therein, is
herein called the "Preliminary Prospectus"). The terms Registration Statement
and Prospectus shall have the meanings ascribed to them in the Purchase
Agreement.
1. Introductory. The Company proposes to issue and sell from time to time
Common Stock registered under the Registration Statement. The shares of
Common Stock involved in any such offering are hereinafter referred to
as the "Shares," and the firm or firms, as the case may be, which agree
to purchase the same are hereinafter referred to as the "Underwriters"
of the Shares. The terms "you" and "your" refer to those Underwriters
who sign the Purchase Agreement either on behalf of themselves only or
on behalf of themselves and as representatives of the several
Underwriters named in Schedule A thereto, as the case may be. Shares to
be purchased by Underwriters are herein referred to as "Underwriters'
Shares," and any Shares to be purchased pursuant to Delayed Delivery
Contracts (as defined below) as hereinafter provided are herein referred
to as "Contract Shares."
2. Delivery and Payment. The Company will deliver the certificates for the
Shares to you for the accounts of the Underwriters at the place
specified in the Purchase Agreement, against payment of the purchase
price by wire transfer of immediately available funds (as agreed to by
the parties and specified in the Purchase Agreement), at the time set
forth in this Agreement or at such other time not later than seven full
business days thereafter as you and the Company determine, such time
being herein referred to as the "time of purchase." Unless otherwise
provided for in the Purchase Agreement, the certificates for the
Underwriters' Shares so to be delivered will be in such denominations
and registered in such names as you request in writing not later than
10.00 A.M.,(1) on the third business day prior to the time of purchase,
or, if no such request is received, in the names of the respective
Underwriters in the denominations agreed to be purchased by them
pursuant to this Agreement. For the purpose of expediting the checking
of the certificates for the Underwriters' Shares, the Company agrees to
make such certificates available to you at the place specified in the
Purchase Agreement registered in such names and denominations as you
shall have requested not later than 10.00 A.M. on the first business day
preceding the time of purchase.(2)
- --------
(1) As used herein, "business day" shall mean a day on which the New York Stock
Exchange is open for trading.
(2) Times mentioned herein are New York City Time
2
<PAGE> 3
If any Purchase Agreement provides for sales of Shares pursuant to
delayed delivery contracts, the Company ___________________ authorizes
the Underwriters to solicit offers to purchase Contract Shares pursuant
to delayed delivery contracts substantially in the form of Schedule I
attached hereto (the "Delayed Delivery Contracts") with such changes
therein as the Company may approve. Delayed Delivery Contracts are to be
with institutional investors, including commercial and savings banks,
insurance companies, pension funds, investment companies, and
educational and charitable institutions. At the time of purchase the
Company will pay you as compensation, for the accounts of the
Underwriters, the compensation set forth in such Purchase Agreement in
respect of the principal amount of Contract Shares. The Underwriters
will not have any responsibility in respect of the validity or the
performance of Delayed Delivery Contracts. If the Company executes and
delivers Delayed Delivery Contracts, the Contract Shares shall be
deducted from the Shares to be purchased by the several Underwriters and
the aggregate principal amount of Shares to be purchased by each
Underwriter shall be reduced pro rata in proportion to the principal
amount of Shares set forth opposite each Underwriter's name in such
Purchase Agreement, except to the extent that you determine that such
reduction shall be otherwise allocated and so advise the Company.
3. Certain Covenants of the Company. The Company agrees:
a) As soon as possible after the execution and delivery of this
Agreement to file, or mail for filing, the Prospectus with the
Commission pursuant to its Rule 424 under the Act and, if and when
required at any time after such execution and delivery, to file
amendments to the applications the Company has previously filed
with any state regulatory agencies having jurisdiction to govern
the Company's issuance of its securities setting forth, among other
things, the necessary information with respect to the price and the
terms of the Shares and the terms of offering of the Shares;
b) To file no amendment or supplement to the Registration Statement or
prospectus (other than a required filing under the Exchange Act)
subsequent to the execution of this Agreement and prior to the time
of purchase to which you object in writing;
c) To furnish such proper information as may be required and otherwise
to cooperate in qualifying the Shares for sale under the laws of
such jurisdictions as you may designate and in determining their
eligibility for investment under the laws of such jurisdictions;
provided 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;
d) To the extent not previously furnished to you, to furnish to you
two signed copies of the Registration Statement, as initially filed
with the Commission, of all amendments thereto, and of all
documents incorporated by reference therein (including all exhibits
filed therewith,
3
<PAGE> 4
other than exhibits which have previously been furnished to you),
two signed copies of each consent and certificate of independent
accountants and of each other person who by his profession gives
authority to statements made by him and who is named in the
Registration Statement as having prepared, certified or reviewed
any part thereof, and to furnish to you sufficient unsigned copies
of the foregoing (other than exhibits, including consents filed as
exhibits, to the Registration Statement) for distribution of a copy
to you and to each of the other Underwriters;
e) To deliver to the Underwriters without charge in New York City as
soon as practicable after the execution and delivery of this
Agreement and thereafter from time to time to furnish to the
Underwriters, without charge, as many copies of the Prospectus in
final form and any documents incorporated by reference therein at
or after the date thereof (or as amended or supplemented, if the
Company shall have made any amendment or supplement after the
effective date of the Registration Statement) as you or the
respective Under-writers may reasonably request for the purposes
contemplated by the Act;
f) To advise you promptly (confirming such advice in writing) of any
official request made by the Commission for amendments to the
Registration Statement or Prospectus or for additional information
with respect thereto, or of official notice of institution of
proceedings for, or the entry of, a stop order suspending the
effective ness of the Registration Statement and, if such order
should be entered by the Commission, to make every reasonable
effort to obtain the lifting or removal thereof as soon as
possible, or of the suspension of qualification of the Shares for
offering or sale in any jurisdiction or of the initiation or
threatening of any proceeding for any such purpose;
g) To apply the net proceeds from the sale of the Shares in the manner
set forth in the Prospectus;
h) To furnish to you during a period of five years from the time of
purchase (i) as soon as practicable after the end of each fiscal
year, a copy of its annual report to shareholders for such year,
(ii) from time to time, copies of any reports or other
communications which it shall file with the Commission or any
governmental agency substituted therefor under the Exchange Act or
sent to its public stockholders, or holders of the Shares, and
(iii) such other information as you may from time to time
reasonably request regarding the financial condition and operations
of the Company;
i) To furnish to any other Underwriter copies of such of the financial
statements, reports or other information referred to in the
foregoing subparagraphs (h)(i) and (ii) as such Underwriter may,
from time to time during the period you are entitled to receive
them, request;
4
<PAGE> 5
j) To advise the Underwriters of the happening of any event known to
the Company within the time during which a prospectus relating to
the Shares is required to be delivered under the Act which, in the
judgment of the Company, would require the making of any change in
the Prospectus or any amended or supplemented Prospectus or in the
information incorporated by reference therein so that as thereafter
delivered to purchasers such Prospectus 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, and
on request to prepare and furnish to the Underwriters and to
dealers and other persons designated by you such amendments or
supplements (including appropriate filings under the Exchange Act)
to the Prospectus as may be necessary to reflect any such change,
provided that the Company shall be so obligated only so long as the
Company is notified of unsold allotments (failure by the
Underwriters to so notify the Company cancels the Company's
obligation under this Section 3(j));
k) As soon as practicable, to make generally available to its security
holders an earnings statement (as contemplated by Rule 158 under
the Act) covering a period of twelve months after the effective
date of the Registration Statement;
l) To pay the fees and expenses of counsel for the Underwriters, and
to reimburse the Underwriters for their reasonable out-of-pocket
expenses incurred in contemplation of the performance of this
Agreement, in the event that the Shares are not delivered to and
taken up and paid for by the Underwriters hereunder for any
reason whatsoever except the failure or refusal of any
Underwriter to take up and pay for Shares for some reason not
permitted by the terms of this Agreement, the Underwriters
agreeing to pay the fees and expenses of counsel for the
Underwriters in any other event;
m) To pay all expenses, fees and taxes (other than transfer taxes and
fees and disbursements of counsel for the Underwriters except as
set forth under 3(1) above or (iv) below) in connection with (i)
the preparation and filing of the Registration Statement, each
Preliminary Prospectus and the Prospectus, any documents
incorporated by reference therein at or after the date thereof and
any amendments or supplements thereto, and the printing or
reproduction and furnishing of copies of each thereof to the
Underwriters and to dealers, (ii) the issue, sale and delivery of
the Shares, (iii) the printing or reproduction of this Agreement
and the opinions and letters referred to in Section 4(a) hereof,
(iv) the qualification of the Shares for sale and determination of
their eligibility for investment under state laws as aforesaid,
including the reasonable legal fees and all filing fees and
disbursements of counsel for the Underwriters and all other filing
fees,
5
<PAGE> 6
and the printing or reproduction and furnishing of copies of the
"Blue Sky Survey" and the "Legal Investment Survey" to the
Underwriters and to dealers, (v) the rating of the Shares by
national rating agencies and (vi) the performance of the Company's
other obligations hereunder;
n) To furnish to you as early as practicable prior to the time of
purchase, but no later than two business days prior thereto, a copy
of the latest available unaudited interim consolidated financial
statements, if any, of the Company which have been read by the
Company's independent public accountants as stated in their letter
to be furnished pursuant to Section 4(a) of this Agreement; and
o) If a public offering of the Shares is to be made, not to offer or
sell any of its Common Stock prior to thirty days after the time of
purchase without your consent (except pursuant to employee benefit
or dividend reinvestment plans).
4. Conditions of Underwriters' Obligations. The several obligations of the
Underwriters hereunder are subject to the following conditions:
a) That, at the time of purchase, you shall receive the signed
opinions of counsel for the Company and counsel for the
Underwriters, substantially in the forms heretofore furnished to
you, addressed to the Underwriters (with reproduced or conformed
copies thereof for each of the other Underwriters); and that, at
the time of purchase, you shall receive the signed letters of the
independent public accountants of the Company, substantially in the
form heretofore furnished to you and in substance satisfactory to
you addressed to the Underwriters (with reproduced or conformed
copies thereof for each of the other Underwriters);
b) That, at or before 5:30 P.M. on the date hereof, or at such later
time and day as you may have from time to time consented to in
writing or by telephone, confirmed in writing, such orders of state
authorities which are necessary to permit the issue, sale and
delivery of the Shares, if any, shall have been issued; at the time
of purchase such orders shall be in full force and effect; and
prior to such time of purchase no stop order with respect to the
effectiveness of the Registration Statement shall have been issued
under the Act by the Commission and at such time of purchase no
proceedings therefor shall be pending or threatened;
c) That, at the time the Registration Statement became effective, the
Registration Statement did not contain an untrue statement of a
material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading, and that at the time of purchase the Prospectus shall
not contain an untrue statement of a material fact or omit to state
a material fact required to be stated therein or necessary to make
the statements therein, in the light of the circumstances under
which they were made, not misleading, other than any statement
6
<PAGE> 7
contained in, or any matter omitted from, the Registration
Statement or the Prospectus in reliance upon, and in conformity
with, information furnished in writing by or on behalf of any
Underwriter through you to the Company expressly for use with
reference to such Underwriter in the Registration Statement or
Prospectus;
d) That, subsequent to the respective dates as of which information is
given in the Registration Statement and in the Prospectus, at the
time the Prospectus is first filed, or mailed for filing, pursuant
to Rule 424 under the Act, and prior to the time of purchase, in
your opinion no material adverse change, or any development
involving a prospective material adverse change, in the condition
of the Company, financial or otherwise, shall have taken place
(other than as referred to in or contemplated by the Registration
Statement and Prospectus as of such time);
e) That the Company shall have performed all of its obligations under
this Agreement which are to be performed by the terms hereof at or
before the time of purchase; and
f) That, since the date of this Agreement, there shall not have
occurred any downgrading, nor shall any notice have been given of
any intended or potential downgrading or of any review for a
possible change that does not indicate the direction of the
possible change, in the rating accorded any of the Company's
securities by any "nationally recognized statistical rating
organization," as such term is defined for purposes of Rule
436(g)(2) under the Act (other than as referred to in or
contemplated by the Registration Statement and the Prospectus as of
such time);
g) That the Company shall, at the time of purchase, deliver to you
(with reproduced or conformed copies thereof for each of the other
Underwriters) a signed certificate of two of its executive officers
stating that, subsequent to the respective dates as of which
information is given in the Registration Statement and in the
Prospectus, at the time the Prospectus is first filed, or mailed
for filing, pursuant to Rule 424 under the Act, and prior to the
time of purchase, no material adverse change, or any development
involving a prospective material adverse change, in the condition
of the Company, financial or otherwise, shall have taken place
(other than as referred to in or contemplated by the Registration
Statement and Prospectus as of such time) and also covering the
matters set forth in (c) and (e) of this Section 4.
h) That the Company shall have accepted Delayed Delivery Contracts in
any case where sales of Contract Shares arranged by the
Underwriters have been approved by the Company.
5. Termination of Agreement. The obligations of the several Underwriters
hereunder shall be subject to termination in your absolute discretion,
if, at any time prior to the time of purchase, trading in securities on
the New York Stock
7
<PAGE> 8
Exchange shall have been suspended (other than a temporary suspension to
provide for an orderly market) or minimum prices shall have been
established on the New York Stock Exchange, or if a banking moratorium
shall have been declared either by the United States or New York State
authorities, or if after the execution of this Agreement the United
States shall have declared war in accordance with its constitutional
processes or there shall have occurred any material outbreak or
escalation of hostilities or other national or international calamity or
crisis of such magnitude in its effect on the financial markets of the
United States as, in your judgment, to make it impracticable to market
the Shares.
If you elect to terminate this Agreement as provided in this
Section 5, the Company and each other Underwriter shall be notified
promptly in writing or by telephone, confirmed in writing.
If the sale to the Underwriters of the Underwriters' Shares as
herein contemplated is not carried out by the Underwriters for any
reason permitted hereunder or if such sale is not carried out because
the Company shall be unable to comply with any of the terms thereof, the
Company shall not be under any obligation or liability under this
Agreement (except to the extent provided in Sections 3(1), 3(m), 7(b)
and 9 hereof), and the Underwriters shall be under no obligation or
liability to the Company (except to the extent provided in Sections 8(b)
and 9 hereof) or to one another under this Agreement.
6. Increase in Underwriters' Commitments. If any Underwriter shall default
in its obligation to take up and pay for the Shares to be purchased by
it hereunder and if the number of Shares which all Underwriters so
defaulting shall have so failed to take up and pay for does not exceed
10% of the total number of Shares, the non-defaulting Underwriters shall
take up and pay for (in addition to the number of Shares they are
obligated to purchase pursuant to this Agreement) the number of Shares
agreed to be purchased by all such defaulting Underwriters, as herein
provided. Such Shares shall be taken up and paid for by such
non-defaulting Underwriter or Underwriters in such number as you may
designate with the consent of each Underwriter so designated or, in the
event no such designation is made, such Shares shall be taken up and
paid for by all non-defaulting Underwriters pro rata in proportion to
the number of Shares set opposite the names of all such non- defaulting
Underwriters in Schedule A to the Purchase Agreement.
Without relieving any defaulting Underwriter of its obligations
hereunder, the Company agrees with the non-defaulting Underwriters that
it will not sell any Shares hereunder unless all of the Shares are
purchased by the Underwriters (or by substituted Underwriters selected
by you with the approval of the Company or selected by the Company with
your approval).
If a new underwriter or underwriters are substituted by the
Underwriters or by the Company for a defaulting Underwriter or
Underwriters in accordance with
8
<PAGE> 9
the foregoing provision, the Company or you will have the right to
postpone the time of purchase for a period of not exceeding five
business days in order that necessary changes in the Registration
Statement and Prospectus and other documents may be effected.
The term Underwriter as used in this Agreement will refer to and
include any underwriter substituted under this Section 6 with like
effect as if such substituted underwriter had originally been named in
Schedule A to the Purchase Agreement.
7. Warranties and Representations of and Indemnity by the Company.
a) The Company warrants and represents that, when the Registration
Statement became effective, the Registration Statement complied in
all material respects, and, when the Prospectus is first filed, or
mailed for filing, pursuant to Rule 424 under the Act, the
Prospectus will comply in all material respects with the provisions
of the Act, and that neither will contain any untrue statement of a
material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading; provided, however, that the Company makes no warranty
or representation with respect to any statement contained in, or
any matter omitted from, the Registration Statement or the
Prospectus in reliance upon and in conformity with information
furnished in writing by or on behalf of any Underwriter through you
to the Company expressly for use with reference to the Underwriter
in the Registration Statement or Prospectus. The Company also
warrants and represents that the documents incorporated by
reference in the Prospectus comply in all material respects with
the requirements of the Exchange Act and any additional documents
deemed to be incorporated by reference in the Prospectus will, when
they are filed with the Commission, comply in all material respects
with the requirements of the Exchange Act, and will not contain an
untrue statement of a material fact or omit to state a material
fact required to be stated therein, or necessary to make the
statements therein, in the light of the circumstances under which
they are made, not misleading.
b) The Company agrees to indemnify and hold harmless each Underwriter,
and any person who controls any Underwriter within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act, from and
against any loss, expense, liability or claim (including the
reasonable fees and expenses of counsel and other reasonable
expenses in connection with investigating, defending or settling
any such claim) which arises out of or is based upon any alleged
untrue statement of a material fact in the Registration Statement,
any prospectus contained in the Registration Statement at the time
it became effective or the Prospectus, or any related
9
<PAGE> 10
preliminary prospectus, or arises out of or is based upon any
alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements made therein not
misleading. The foregoing shall not cover any such loss, expense,
liability or claim, however, which arises out of or is based upon
any alleged untrue statement of a material fact contained in, and
in conformity with information furnished in writing by or on behalf
of such Underwriter through you to the Company expressly for use
with reference to the Underwriter in, any such documents or arises
out of or is based upon any alleged omission to state a material
fact in connection with such information required to be stated in
any such documents or necessary to make such information not
misleading.
If any action is brought against an Underwriter or controlling
person in respect of which indemnity may be sought against the Company
pursuant to the foregoing paragraph, such Underwriter shall promptly
notify the Company in writing or by telephone, confirmed in writing, of
the institution of such action and the Company shall assume the defense
of such action, including the employment of counsel and payment of
expenses. Such Underwriter or controlling person shall have the right to
employ its or their own counsel in any such case, but the fees and
expenses of such counsel shall be at the expense of such Underwriter or
such controlling person unless the employment of such counsel shall have
been authorized in writing by the Company in connection with the defense
of such action or the Company shall not have employed counsel to have
charge of the defense of such action or such indemnified party or
parties shall have reasonably concluded that there may be defenses
available to it or them which are different from or additional to those
available to the Company (in which case the Company shall not have the
right to direct the defense of such action on behalf of the indemnified
party or parties), in any of which events such fees and expenses of one
counsel (in addition to local counsel) for all indemnified parties
selected by you shall be borne by the Company. Anything in this
paragraph to the contrary notwithstanding, the Company shall not be
liable for any settlement of any such claim or action effected without
its written consent. The Company's indemnity agreement contained in this
Section 7(b) and its warranties and representations contained in this
Agreement shall remain in full force and effect regardless of any
investigation made by or on behalf of any Underwriter or controlling
person, and shall survive any termination of this Agreement or the
issuance and delivery of the Shares. The Company agrees promptly to
notify the Underwriters of the commencement of any litigation or
proceedings against the Company or any of its officers or directors in
connection with the issue and sale of the Shares or with such
Registration Statement or Prospectus.
8. Warranties and Representations of the Indemnity by Underwriters.
a) Each Underwriter warrants and represents that the information
furnished in writing by or on behalf of such Underwriter through
you to the
10
<PAGE> 11
Company expressly for use with reference to such Underwriter in the
Registration Statement at the time it became effective or the
Prospectus, or any related preliminary prospectus does not contain
an untrue statement of a material fact and does not omit to state a
material fact in connection with such information required to be
stated in the Registration Statement at the time it became
effective or the Prospectus, or any related preliminary prospectus
or necessary to make such information not misleading. Each
Underwriter, in addition to other information furnished by such
Underwriter or on its behalf through you to the Company in writing
expressly for use with reference to such Underwriter in the
Registration Statement and Prospectus, hereby furnishes to the
Company in writing expressly for use with reference to such
Underwriter the statements with respect to the terms of offering of
the Shares by the Underwriters set forth on the cover page of the
Prospectus Supplement and under "underwriting" therein.
b) Each Underwriter severally agrees to indemnify and hold harmless
the Company, its directors and its officers from and against any
loss, expense, liability or claim (including the reasonable fees
and expenses of counsel and other reasonable expenses in connection
with investigating, defending or settling any such claim) which
arises out of or is based upon any alleged untrue statement of a
material fact contained in, and in conformity with information
furnished in writing by or on behalf of such Underwriter through
you to the Company expressly for use with reference to such
Underwriter in, the Registration Statement, any prospectus
contained in the Registration Statement at the time it became
effective or the Prospectus, or any related preliminary prospectus,
or arises out of or is based upon any alleged omission to state a
material fact in connection with such information required to be
stated in such documents or necessary to make such information not
misleading.
If any action is brought against the Company or any such person in
respect of which indemnity may be sought against any Underwriter
pursuant to the foregoing paragraph, the Company or such person shall
promptly notify such Underwriter in writing or by telephone, confirmed
in writing, of the institution of such action and such Underwriter shall
assume the defense of such action, including the employment of counsel
and payment of expenses. The Company or such person shall have the right
to employ its or their own counsel in any such case, but the fees and
expenses of such counsel shall be at the expense of the Company or such
person unless the employment of such counsel shall have been authorized
in writing by such Underwriter in connection with the defense of such
action or such Underwriter shall not have employed counsel to have
charge of the defense of such action or such indemnified party or
parties shall have reasonably concluded that there may be defenses
available to it or them which are different from or additional to those
available to such Underwriter (in which case such Underwriter shall not
have the right to direct the defense of such action on behalf
11
<PAGE> 12
of the indemnified party or parties), in any of which events such fees
and expenses for all indemnified parties of one counsel (in addition to
local counsel) selected by the Company shall be borne by such
Underwriter. Anything in this paragraph to the contrary notwithstanding,
no Underwriter shall be liable for any settlement of any such claim or
action effected without the written consent of such Underwriter. The
indemnity agreement on the part of each Underwriter contained in this
Section 8(b) shall remain in full force and effect regardless of any
investigation made by or on behalf of Company or such person, and shall
survive any termination of this Agreement or the issuance and delivery
of the Shares. Each Underwriter agrees promptly to notify the Company of
the commencement of any litigation or proceedings against such
Underwriter in connection with the issue and sale of the Shares or with
such Registration Statement or Prospectus.
9. Contribution. If the indemnification provided for in Section 7(b) or
8(b) above is unavailable in respect of any losses, expenses,
liabilities or claims referred to therein, then the parties entitled to
indemnification by the terms thereof shall be entitled to contribution
to liabilities and expenses except to the extent that contribution is
not permitted under the Act or the Exchange 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 Shares (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
and such controlling persons agree that it would not be equitable if the
amount of such contribution were determined by pro rata or per capita
allocation (even if the Underwriters and such controlling persons were
treated as one entity for such purpose). Notwithstanding the provisions
of this Section 9, no indemnifying Underwriter shall be required to
contribute any amount in excess of the amount by which the total price
at which the Securities underwritten by such Under- writer and
distributed to the public were offered to the public exceeds the amount
of any damages which such Underwriter otherwise has been required to pay
by reason of such untrue statement or alleged untrue statement or
omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall
be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The contribution agreement contained in
this Section 9 shall remain in full force and effect regardless of any
investigation made by or on behalf of any Underwriter or the Company or
any of its officers or directors or any controlling person and shall
survive any termination of this Agreement or the issuance and delivery
of the Shares.
10. Notices. All statements, requests, notices and agreements shall be in
writing or by telegram and, if to the Underwriters, shall be sufficient
in all respects if delivered or sent by registered mail to the address
furnished in writing for the purpose of such statements, requests,
notices and agreements hereunder, and, if to the
12
<PAGE> 13
Company shall be sufficient in all respects if delivered or sent by
registered mail to the Company at [Issuer/Address], Attention: .
11. Construction. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York.
The section headings in this Agreement have been inserted as a matter of
convenience of reference and are not a part of this agreement.
12. The Agreement herein set forth has been and is made solely for the
benefit of the Underwriters and the controlling persons, directors and
officers referred to in Section 8 hereof, and their respective
successors, assigns, executors and administrators, and no other person
shall acquire or have any right under or by virtue of this Agreement.
Nothing in this Agreement is intended or shall be construed to give to
any other person, firm or corporation (including, without limitation,
any purchaser of the Securities from an Underwriter or any subsequent
holder thereof) any legal or equitable right, remedy or claim under or
in respect of this Agreement or any provision herein contained.
The term "successor" as used in this Agreement shall not include any
purchaser, as such purchaser, of any Shares from any Underwriter or any
subsequent holder thereof.
13. Counterparts. This Agreement may be executed in any number of
counterparts which, taken together, shall constitute one and the same
instrument.
13
<PAGE> 14
Schedule I
DELAYED DELIVERY CONTRACT
Dated: ______________, 199
[NAME OF ISSUER]
[ADDRESS]
Attention:
Dear Sirs:
The undersigned hereby agrees to purchase from [Name of Issuer] (the
"Company"), and the Company agrees to sell to the undersigned,
___________________ shares
of the Company's [state title of issue] (the "Shares") offered by the Company's
Prospectus dated __________, 199 and a Prospectus Supplement dated ___________ ,
199 , receipt of copies of which is hereby acknowledged, at a purchase price of
$ ____________ per share and on the further terms and conditions set forth in
this contract.
The undersigned agrees to purchase such Shares in the amounts and on
the delivery dates (the "Delivery Dates") set forth below:
Delivery Number of
Date Shares
-------- ---------
- ---------------- ---------------
- ---------------- ---------------
- ---------------- ---------------
Payment for the Shares which the undersigned has agreed to purchase on
each Delivery Date shall be made to the Company or its order by wire transfer of
immediately
14
<PAGE> 15
available funds at the Corporate Trust Office of _____________ (or at such
other place as the undersigned and the Company shall agree) at 11:00 A.M., New
York City Time, on such Delivery Date upon issuance and delivery to the
undersigned of the Shares to be purchased by the undersigned on such Delivery
Date and, unless otherwise provided herein, registered in such names as the
undersigned may designate by written or telegraphic communications addressed to
the Company not less than five full business days prior to such Delivery Date.
The obligation of the Company to sell and deliver, and of the
undersigned to take delivery of and make payment for, Shares on each Delivery
Date shall be subject to the conditions that (1) the purchase of Shares to be
made by the undersigned shall not at the time of delivery be prohibited under
the laws of the jurisdiction to which the undersigned is subject, (2) the sale
of the Shares by the Company pursuant to this contract shall not at the time of
delivery be prohibited under the laws of any jurisdiction to which the Company
is subject and (3) the Company shall have sold, and delivery shall have taken
place, to the Underwriters of such number of the Shares as is to be sold and
delivered to them. In the event that Shares are not sold to the undersigned
because one of the foregoing conditions is not met, the Company shall not be
liable to the undersigned for damages arising out of the transactions covered by
this contract.
Promptly after completion of the sale and delivery to the
Underwriters, the Company will mail or deliver to the undersigned at its address
set forth below notice to such effect, accompanied by copies of the opinions of
counsel for the Company delivered to the Underwriters.
Failure to take delivery of and make payment for Shares by any
purchaser under any other Delayed Delivery Contract shall not relieve the
undersigned of its obligations under this contract.
The undersigned represents and warrants that (a) as of the date of
this contract, the undersigned is not prohibited under the laws of the
jurisdictions to which the undersigned is subject from purchasing the Shares
hereby agreed to be purchased and (b) the undersigned does not contemplate
selling the Shares which it has agreed to purchase hereunder prior to the
Delivery Date therefor.
This contract will inure to the benefit of and be binding upon the
parties hereto and their respective successors, but will not be assignable by
either party hereto without the written consent of the other. This contract
shall be governed by and construed in accordance with the laws of the State of
New York. This contract may be executed in one or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
It is understood that the acceptance of any Delayed Delivery Contract
is in the Company's sole discretion and, without limiting the foregoing, need
not be on a first-come, first-served basis. If the contract is acceptable to the
Company, it is requested
15
<PAGE> 16
that the Company sign the form of acceptance below and mail or deliver one of
the counterparts hereof to the undersigned at its address set forth below. This
will become a binding contract between the Company and the undersigned when such
counterpart is so signed.
Yours very truly,
______________________________________
By____________________________________
______________________________________
______________________________________
Address
Accepted, as of the date first above written
[Name of Issuer]
By_________________________________
PURCHASER -- PLEASE COMPLETE AT TIME OF SIGNING
The name and telephone and department of the representative of the
Purchaser with whom details of delivery on the Delivery Date may be discussed
are as follows:
(Please print.)
Telephone No.
Name (Including Area Code) Department
16
<PAGE> 17
[NAME OF ISSUER]
PURCHASE AGREEMENT
COMMON STOCK
[Name of Issuer]
[ADDRESS]
Dear Sirs:
Referring to the Common Stock of [Name of Issuer] (the "Company")
covered by the registration statement on Form S-3 (No. 333-______), such
registration statement including (i) the prospectus included therein, dated
______________ , 199_ in the form first filed under Rule 424 and any additional
prospectus supplements relating to the Common Stock filed under Rule 424 (such
prospectus as so supplemented, including each document incorporated by reference
therein is hereinafter called the "Prospectus") and (ii) all documents filed as
part thereof or incorporated by reference therein, is hereinafter called the
"Registration Statement", on the basis of the representations, warranties and
agreements contained in this Agreement, but subject to the terms and conditions
herein set forth, the purchaser or purchasers named in Schedule A hereto (the
"Underwriters") agree to purchase, severally, and the Company agrees to sell to
the Underwriters, severally, the respective number of shares of Common Stock
having the terms described below (the "Shares") set forth opposite the name of
each Underwriter on Schedule A hereto.
The price at which the Shares shall be purchased from the Company by
the Underwriters shall be $____ per share. The initial public offering price
shall be $____ per share. The Shares will be offered by the Underwriters as set
forth in the Prospectus relating to such Shares.
The Shares will have the following terms:
17
<PAGE> 18
Title of Shares:
Payment for the Shares shall be made in the following funds:
_______________________
The "time of purchase" shall be: _______________________
The place at which the Shares may be checked and packaged shall be:
_______________________
The place(s) at which the Shares shall be delivered and sold shall be:
_______________________
Delayed Delivery
Contracts: _______________________
18
<PAGE> 19
Notices to Underwriters shall be sent to the following address(es) or
telecopier number(s):
If we are acting as Representative(s) for the several Underwriters named
in Schedule A hereto, we represent that we are authorized to act for such
several Underwriters in connection with the transactions contemplated in this
Agreement, and that, if there are more than one of us, any action under this
Agreement taken by any of us will be binding upon all the Underwriters.
All of the provisions contained in the document entitled "[Name of
Issuer] Standard Purchase Provisions - Equity Securities", a copy of which has
been previously furnished to us, are hereby incorporated by reference in their
entirety and shall be deemed to be a part of this Agreement to the same extent
as if such provisions had been set forth in full herein.
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 several
Underwriters in accordance with its terms.
Very truly yours,
[Firm Name]
By _____________________________
Title: ______________________
[Firm Name]
By _____________________________
Title: ______________________
Acting on behalf of and as
Representative(s) of the
several Underwriters named
in Schedule A hereto.*
- -------------------
* To be deleted if the Purchase Agreement is not executed by one or more
Underwriters acting as Representative(s) of the Underwriters for purposes
of this Agreement.
19
<PAGE> 20
The foregoing Purchase Agreement is
hereby confirmed as of the date
first above written
[NAME OF ISSUER]
By ____________________________
Title: _____________________
_______________________________
20
<PAGE> 21
SCHEDULE A
Number
of
Name of Underwriters Shares
Total
==========
21
<PAGE> 1
Exhibit B-2
[NAME OF ISSUER]
DEBT SECURITIES
STANDARD PURCHASE PROVISIONS
INCLUDING
FORM OF PURCHASE AGREEMENT
[NAME OF ISSUER]
STANDARD PURCHASE PROVISIONS -
DEBT SECURITIES
From time to time, [Name of Issuer], a corporation organized and
existing under the laws of the State of Delaware (the "Company"), may enter into
purchase agreements that provide for the sale of designated securities to the
purchaser or purchasers named therein. The standard provisions set forth herein
may be incorporated by reference in any such purchase agreement (the "Purchase
Agreement"). The Purchase Agreement, including the provisions incorporated
therein by reference, is herein sometimes referred to as "this Agreement." The
term "Securities" shall mean the Debt Securities of the Company to be sold by
the Company pursuant to the applicable Purchase Agreement. Unless otherwise
defined herein, terms defined in the Purchase Agreement are used herein as
therein defined.
The Company has filed, in accordance with the provisions of the
Securities Act of 1933, as amended, and the rules and regulations of the
Securities and Exchange Commission thereunder (collectively called the "Act"),
with the Securities and Exchange Commission (the "Commission"), a registration
statement on Form S-3 (including a prospectus), relating to the Securities,
which pursuant to Item 12 of Form S-3 incorporates by reference documents which
the Company has filed in accordance with the provisions of the Securities
Exchange Act of 1934, as amended, and the rules and regulations thereunder
(collectively called the "Exchange Act"). Such registration statement has been
declared effective by the Commission. Promptly upon the execution of this
Agreement, the Company will prepare a prospectus supplement relating to the
Securities (the "Prospectus Supplement"). The Company has furnished to you, for
use by the Underwriters (as defined herein) and dealers, copies of one or more
preliminary prospectuses and the documents so incorporated therein (each
thereof, including the doc- uments so incorporated therein, is herein called the
"Preliminary Prospectus"). The terms Registration Statement and Prospectus shall
have the meanings ascribed to them in the Purchase Agreement.
<PAGE> 2
1. Introductory. The Company proposes to issue and sell from time to time
Securities registered under the Registration Statement. The Securities will
be issued pursuant to an Indenture, dated , to as Trustee (the "Trustee"),
as supplemented and amended, including a supplemental indenture pertaining
to the particular series of Securities involved in the offering (the
"Indenture"), and will have varying designations, interest rates and times
of payment of any interest, maturities, redemption provisions and other
terms, with all such terms for any particular series of the Securities
being determined at the time of the sale and set forth in the Purchase
Agreement and the Prospectus Supplement relating to such series of
Securities. The Securities involved in any such offering are hereinafter
referred to as the "Purchased Securities," and the firm or firms, as the
case may be, which agree to purchase the same are hereinafter referred to
as the "Underwriters" of the Purchased Securities. The terms "you" and
"your" refer to those Underwriters who sign the Purchase Agreement either
on behalf of themselves only or on behalf of themselves and as
representatives of the several Underwriters named in Schedule A thereto, as
the case may be. Purchased Securities to be purchased by Underwriters are
herein referred to as "Underwriters' Securities," and any Purchased
Securities to be purchased pursuant to Delayed Delivery Contracts (as
defined below) as hereinafter provided are herein referred to as "Contract
Securities."
2. Delivery and Payment. The Company will deliver the Underwriters' Securities
to you for the accounts of the Underwriters at the place specified in the
Purchase Agreement, against payment of the purchase price by wire transfer
of immediately available funds (as agreed to by the parties and specified
in the Purchase Agreement), at the time set forth in this Agreement [or at
such other time not later than seven full business days thereafter] as you
and the Company determine, such time being herein referred to as the "time
of purchase." Unless otherwise provided for in the Purchase Agreement, the
Underwriters' Securities so to be delivered will be in definitive fully
registered form registered in such authorized denominations and in such
names as you request in writing not later than 10:00 A.M.,1 on the third
business day prior to the time of purchase, or, if no such request is
received, in the names of the respective Underwriters in the amounts agreed
to be purchased by them pursuant to this Agreement. For the purpose of
expediting the checking of the Underwriters' Securities, the Company agrees
to make the Underwriters' Securities available to you (at the place
specified in the Purchase Agreement) in definitive form not later than
10:00 A.M. on the first businessday preceding the time of purchase.2
If any Purchase Agreement provides for sales of Purchased Securities
pursuant to delayed delivery contracts, the Company authorizes the Underwriters
to solicit offers to
- --------
(1) Times mentioned herein are New York City Time
(2)* As used herein, "business day" shall mean a day on which the New York
Stock Exchange is open for trading.
2
<PAGE> 3
purchase Contract Securities pursuant to delayed delivery contracts
substantially in the form of Schedule I attached hereto (the "Delayed Delivery
Contracts") with such changes therein as the Company may approve. Delayed
Delivery Contracts are to be with institutional investors, including commercial
and savings banks, insurance companies, pension funds, investment companies, and
educational and charitable institutions. At the time of purchase the Company
will pay you as compensation, for the accounts of the Underwriters, the
compensation set forth in such Purchase Agreement in respect of the principal
amount of Contract Securities. The Underwriters will not have any responsibility
in respect of the validity or the performance of Delayed Delivery Contracts. If
the Company executes and delivers Delayed Delivery Contracts, the Contract
Securities shall be deducted from the Purchased Securities to be purchased by
the several Underwriters and the aggregate principal amount of Purchased
Securities to be purchased by each Underwriter shall be reduced pro rata in
proportion to the principal amount of Purchased Securities set forth opposite
each Underwriter's name in such Purchase Agreement, except to the extent that
you determine that such reduction shall be otherwise allocated and so advise the
Company.
3. Certain Covenants of the Company. The Company agrees:
a) As soon as possible after the execution and delivery of this
Agreement to file, or mail for filing, the Prospectus with the
Commission pursuant to its Rule 424 under the Act and, if and when
required at any time after such execution and delivery, to file
amendments to the applications the Company has previously filed
with any state regulatory agencies having jurisdiction to govern
the Company's issuance of its securities setting forth, among other
things, the necessary information with respect to the price and
terms of the Purchased Securities and the terms of offering of the
Purchased Securities;
b) To file no amendment or supplement to the Registration Statement or
Prospectus (other than a required filing under the Exchange Act)
subsequent to the execution of this Agreement to which you object
in writing;
c) To furnish such proper information as may be required and otherwise
to cooperate in qualifying the Purchased Securities for sale under
the laws of such jurisdictions as you may designate and in
determining their eligibility for investment under the laws of such
jurisdictions; provided 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;
d) To the extent not previously furnished to you, to furnish to you
two signed copies of the Registration Statement, as initially filed
with the Commission, of all amendments thereto, and of all
documents incorporated by reference herein (including all exhibits
filed therewith, other than exhibits which have previously been
furnished to you), two signed copies of each consent and
certificate of independent accountants and of each other person who
by his profession gives
3
<PAGE> 4
authority to statements made by him and who is named in the
Registration Statement as having prepared, certified or reviewed
any part thereof, and to furnish to you sufficient unsigned copies
of the foregoing (other than exhibits, including consents filed as
exhibits, to the Registration Statement) for distribution of a copy
to you and to each of the other Underwriters;
e) To deliver to the Underwriters without charge in New York City as
soon as practicable after the execution and delivery of this
Agreement and thereafter from time to time to furnish to the
Underwriters, without charge, as many copies of the Prospectus in
final form and any documents incorporated by reference therein at
or after the date thereof (or as amended or supplemented, if the
Company shall have made any amendment or supplement after the
effective date of the Registration Statement) as you or the
respective Under-writers may reasonably request for the purposes
contemplated by the Act;
f) To advise you promptly (confirming such advice in writing) of any
official request made by the Commission for amendments to the
Registration Statement or Prospectus or for additional information
with respect thereto, or of official notice of institution of
proceedings for, or the entry of, a stop order suspending the
effectiveness of the Registration Statement and, if such order
should be entered by the Commission, to make every reasonable
effort to obtain the lifting or removal thereof as soon as
possible, or of the suspension of qualification of the Purchased
Securities for offering or sale in any jurisdiction or of the
initiation or threatening of any proceeding for any such purpose;
g) To apply the net proceeds from the sale of the Purchased Securities
in the manner set forth in the Prospectus;
h) To furnish to you during a period of five years from the time of
purchase (i) as soon as practicable after the end of each fiscal
year, a copy of its annual report to shareholders for such year;
(ii) from time to time, copies of any reports or other
communications which it shall file with the Commission or any
governmental agency substituted therefor under the Exchange Act or
sent to its public stockholders, or holders of the Purchased
Securities, and (iii) such other information as you may from time
to time reasonably request regarding the financial condition and
operations of the Company;
i) To furnish to any other Underwriter copies of such of the financial
statements, reports or other information referred to in the
foregoing subparagraphs (h)(i) and (ii) as such Underwriter may,
from time to time during the period you are entitled to receive
them, request;
j) To advise the Underwriters of the happening of any event known to
the Company within the time during which a prospectus relating to
the Purchased Securities is required to be delivered under the Act
which, in the judgment of the Company,
4
<PAGE> 5
would require the making of any change in the Prospectus or any
amended or supplemented Prospectus or in the information
incorporated by reference therein so that as thereafter delivered
to purchasers such Prospectus will not include an untrue statement
of a material fact or omit to state a material fact required to be
stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they were
made, not misleading, and on request to prepare and furnish to the
underwriters and to dealers and other persons designated by you
such amendments or supplements (including appropriate filings under
the Exchange Act) to the Prospectus as may be necessary to reflect
any such change, provided that the Company shall be so obligated
only so long as the Company is notified of unsold allotments
(failure by the Underwriters to so notify the Company cancels the
Company's obligation under this Section 3(j));
k) As soon as practicable, to make generally available to its security
holders an earnings statement (as contemplated by Rule 158 under
the Act) covering a period of twelve months after the effective
date of the Registration Statement;
l) To pay the fees and expenses of counsel for the Underwriters, and
to reimburse the Underwriters for their reasonable out-of-pocket
expenses incurred in contemplation of the performance of this
Agreement, in the event that the Underwriters' Securities are not
delivered to and taken up and paid for by the Underwriters
hereunder for any reason whatsoever except the failure or refusal
of any Underwriter to take up and pay for Underwriters' Securities
for some reason not permitted by the terms of this Agreement, the
Underwriters agreeing to pay the fees and expenses of counsel for
the Underwriters in any other event;
m) To pay all expenses, fees and taxes (other than transfer taxes and
fees and disbursements of counsel for the Underwriters except as
set forth under 3(l) above or (iv) below) in connection with (i)
the preparation and filing of the Registration Statement, each
Preliminary Prospectus and the Prospectus, any documents
incorporated by reference therein at or after the date thereof and
any amendments or supplements thereto, and the printing or
reproduction and furnishing of copies of each thereof to the
Underwriters and to dealers, (ii) the issue, sale and delivery of
the Purchased Securities, (iii) the printing or reproduction of
this Agreement and the opinions and letters referred to in Section
4(a) hereof, (iv) the qualification of the Purchased Securities for
sale and determination of their eligibility for investment under
state laws as aforesaid, including the legal fees and all filing
fees and disbursements of counsel for the Underwriters and all
other filing fees, and the printing or reproduction and furnishing
of copies of the "Blue Sky Survey" and the "Legal Investment
Survey" to the Underwriters and to dealers, (v) the rating of the
Purchased Securities by national rating agencies and (vi) the
performance of the Company's other obligations hereunder;
n) To furnish to you as early as practicable prior to the time of
purchase, but no later than two business days prior thereto, a copy
of the latest available unaudited
5
<PAGE> 6
interim consolidated financial statements, if any, of the Company
which have been read by the Company's independent public
accountants as stated in their letters to be furnished pursuant to
Section 4(a) of this Agreement; and
o) If a public offering of the Purchased Securities is to be made, not
to offer or sell any of its other debt securities which are
substantially similar to the Purchased Securities prior to ten days
after the time of purchase without your consent.
4. Conditions of Underwriters' Obligations. The several obligations of the
Underwriters hereunder are subject to the following conditions:
a) That, at the time of purchase, you shall receive the signed
opinions of counsel for the Company and counsel for the
Underwriters, substantially in the forms heretofore furnished to
you, addressed to the Underwriters (with reproduced or conformed
copies thereof for each of the other Underwriters); and that, at
the time of purchase, you shall receive the signed letters of the
independent public accountants of the Company, substantially in the
form heretofore furnished to you and in substance satisfactory to
you addressed to the Underwriters (with reproduced or conformed
copies thereof for each of the other Underwriters);
b) That, at or before 5:30 P.M. on the date hereof, or at such later
time and day as you may have from time to time consented to in
writing or by telephone, confirmed in writing, such orders of state
authorities which are necessary to permit the issue, sale and
delivery of the Purchased Securities, if any, shall have been
issued; at the time of purchase such orders shall be in full force
and effect; and prior to such time of purchase no stop order with
respect to the effectiveness of the Registration Statement shall
have been issued under the Act by the Commission and at such time
of purchase no proceedings therefor shall be pending or threatened;
c) That, at the time the Registration Statement became effective, the
Registration Statement did not contain an untrue statement of a
material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading, and that at the time of purchase the Prospectus shall
not contain an untrue statement of a material fact or omit to state
a material fact required to be stated therein or necessary to make
the statements therein, in the light of the circumstances under
which they were made, not misleading, other than any statement
contained in, or any matter omitted from, the Registration
Statement or the Prospectus in reliance upon, and in conformity
with, information furnished in writing by or on behalf of any
Underwriter through you to the Company expressly for use with
reference to such Underwriter in the Registration Statement or
Prospectus;
d) That, subsequent to the respective dates as of which information is
given in the Registration Statement and in the Prospectus, at the
time the Prospectus is first
6
<PAGE> 7
filed, or mailed for filing, pursuant to Rule 424 under the Act,
and prior to the time of purchase, in your opinion no material
adverse change, or any development involving a prospective material
adverse change, in the condition of the Company, financial or
otherwise, shall have taken place (other than as referred to in or
contemplated by the Registration Statement and Prospectus as of
such time);
e) That the Company shall have performed all of its obligations under
this Agreement which are to be performed by the terms hereof at or
before the time of purchase;
f) That, since the date of this Agreement, there shall not have
occurred any downgrading, nor shall any notice have been given of
any intended or potential downgrading or of any review for a
possible change that does not indicate the direction of the
possible change, in the rating accorded any of the Company's
securities by any "nationally recognized statistical rating
organization," as such term is defined for purposes of Rule
436(g)(2) under the Act (other than as referred to in or
contemplated by the Registration Statement and the Prospectus as of
such time);
g) That the Company shall, at the time of purchase, deliver to you
(with reproduced or conformed copies thereof for each of the other
Underwriters) a signed certificate of two of its executive officers
stating that, subsequent to the respective dates as of which
information is given in the Registration Statement and in the
Prospectus, at the time the Prospectus is first filed, or mailed
for filing, pursuant to Rule 424 under the Act, and prior to the
time of purchase, no material adverse change, or any development
involving a prospective material adverse change, in the condition
of the Company, financial or otherwise, shall have taken place
(other than as referred to in or contemplated by the Registration
Statement and Prospectus as of such time) and also covering the
matters set forth in (c) and (e) of this Section 4; and
h) That the Company shall have accepted Delayed Delivery Contracts in
any case where sales of Contract Securities arranged by the
Underwriters have been approved by the Company.
5. Termination of Agreement. The obligations of the several Underwriters
hereunder shall be subject to termination in your absolute discretion,
if, at any time prior to the time of purchase, trading in securities on
the New York Stock Exchange shall have been suspended (other than a
temporary suspension to provide for an orderly market) or minimum prices
shall have been established on the New York Stock Exchange, or if a
banking moratorium shall have been declared either by the United States
or New York State authorities, or if after the execution of this
Agreement the United States shall have declared war in accordance with
its constitutional processes or there shall have occurred any material
outbreak or escalation of hostilities or other national or international
calamity or crisis of such magnitude in its effect on the financial
markets
7
<PAGE> 8
of the United States as, in your judgment, to make it impracticable to
market the Purchased Securities.
If you elect to terminate this Agreement as provided in this Section 5,
the Company and each other Underwriter shall be notified promptly in writing or
by telephone, confirmed in writing.
If the sale to the Underwriters of the Underwriters' Securities, as
herein contemplated, is not carried out by the Underwriters for any reason
permitted hereunder or if such sale is not carried out because the Company shall
be unable to comply with any of the terms thereof, the Company shall not be
under any obligation or liability under this Agreement (except to the extent
provided in Sections 3(l), 3(m), 7(b) and 9 hereof), and the Underwriters shall
be under no obligation or liability to the Company (except to the extent
provided in Sections 8(b) and 9 hereof) or to one another under this Agreement.
6. Increase in Underwriters' Commitments: If any Underwriter shall default
in its obligation to take up and pay for the Purchased Securities to be
purchased by it hereunder and if the principal amount of the Purchased
Securities which all Underwriters so defaulting shall have so failed to
take up and pay for does not exceed 10% of the total principal amount of
the Purchased Securities, the non-defaulting Underwriters shall take up
and pay for (in addition to the principal amount of the Purchased
Securities they are obligated to purchase pursuant to this Agreement)
the principal amount of the Purchased Securities agreed to be purchased
by all such defaulting Underwriters, as herein provided. Such Purchased
Securities shall be taken up and paid for by such non-defaulting
Underwriter or Underwriters in such amount or amounts as you may
designate with the consent of each Underwriter so designated or, in the
event no such designation is made, such Purchased Securities shall be
taken up and paid for by all non-defaulting Underwriters pro rata in
proportion to the principal amount of the Purchased Securities set
opposite the names of all such non-defaulting Underwriters in Schedule A
to the Purchase Agreement.
Without relieving any defaulting Underwriter of its obligations
hereunder, the Company agrees with the non-defaulting Underwriters that it will
not sell any Purchased Securities hereunder unless all of the Underwriters'
Securities are purchased by the Underwriters (or by substituted Underwriters
selected by you with the approval of the Company or selected by the Company with
your approval).
If a new underwriter or underwriters are substituted by the Underwriters
or by the Company for a defaulting Underwriter or Underwriters in accordance
with the foregoing provision, the Company or you will have the right to postpone
the time of purchase for a period of not exceeding five business days in order
that necessary changes in the Registration Statement and Prospectus and other
documents may be effected.
8
<PAGE> 9
The term Underwriter as used in this Agreement will refer to and include
any underwriter substituted under this Section 6 with like effect as if such
substituted underwriter had originally been named in Schedule A to the Purchase
Agreement.
7. Warranties and Representations of and Indemnity by the Company.
a) The Company warrants and represents that, when the Registration
Statement became effective, the Registration Statement complied in
all material respects, and, when the Prospectus is first filed, or
mailed for filing, pursuant to Rule 424 under the Act, the
Prospectus will comply in all material respects with the provisions
of the Act, and that neither will contain any untrue statement of a
material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading; provided, however, that the Company makes no warranty
or representation with respect to any statement contained in, or
any matter omitted from, the Registration Statement or the
Prospectus in reliance upon and in conformity with information
furnished in writing by or on behalf of any Underwriter through you
to the Company expressly for use with reference to the Underwriter
in the Registration Statement or Prospectus. The Company also
warrants and represents that the documents incorporated by
reference in the Prospectus comply in all material respects with
the requirements of the Exchange Act and any additional documents
deemed to be incorporated by reference in the Prospectus will, when
they are filed with the Commission, comply in all material respects
with the requirements of the Exchange Act, and will not contain an
untrue statement of a material fact or omit to state a material
fact required to be stated therein, or necessary to make the
statements therein, in the light of the circumstances under which
they are made, not misleading.
b) The Company agrees to indemnify and hold harmless each Underwriter,
and any person who controls any Underwriter within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act, from and
against any loss, expense, liability or claim (including the
reasonable fees and expenses of counsel and other reasonable
expenses in connection with investigating, defending or settling
any such claim) which arises out of or is based upon any alleged
untrue statement of a material fact in the Registration Statement,
any prospectus contained in the Registration Statement at the time
it became effective or the Prospectus, or any related preliminary
prospectus, or arises out of or is based upon any alleged omission
to state therein a material fact required to be stated therein or
necessary to make the statements made therein not misleading. The
foregoing shall not cover any such loss, expense, liability or
claim, however, which arises out of or is based upon any alleged
untrue statement of a material fact contained in, and in conformity
with information furnished in writing by or on behalf of such
Underwriter through you to the Company expressly for use with
reference to the Underwriter in, any such documents or arises out
of or is based upon any alleged omission to state a
9
<PAGE> 10
material fact in connection with such information required to be
stated in any such documents or necessary to make such information
not misleading.
If any action is brought against an Underwriter or controlling person in
respect of which indemnity may be sought against the Company pursuant to the
foregoing paragraph, such Underwriter shall promptly notify the Company in
writing or by telephone, confirmed in writing, of the institution of such action
and the Company shall assume the defense of such action, including the
employment of counsel and payment of expenses. Such Underwriter or controlling
person shall have the right to employ its or their own counsel in any such case,
but the fees and expenses of such counsel shall be at the expense of such
Underwriter or such controlling person unless the employment of such counsel
shall have been authorized in writing by the Company in connection with the
defense of such action or the Company shall not have employed counsel to have
charge of the defense of such action or such indemnified party or parties shall
have reasonably concluded that there may be defenses available to it or them
which are different from or additional to those available to the Company (in
which case the Company shall not have the right to direct the defense of such
action on behalf of the indemnified party or parties), in any of which events
such fees and expenses of one counsel (in addition to local counsel) for all
indemnified parties selected by you shall be borne by the Company. Anything in
this paragraph to the contrary notwithstanding, the Company shall not be liable
for any settlement of any such claim or action effected without its written
consent. The Company's indemnity agreement contained in this Section 7(b) and
its warranties and representations contained in this Agreement shall remain in
full force and effect regardless of any investigation made by or on behalf of
any Underwriter or controlling person, and shall survive any termination of this
Agreement or the issuance and delivery of the Purchased Securities. The Company
agrees promptly to notify the Underwriters of the commencement of any litigation
or proceedings against the Company or any of its officers or directors in
connection with the issue and sale of the Purchased Securities or with such
Registration Statement or Prospectus.
8. Warranties and Representations of and Indemnity by Underwriters.
a) Each Underwriter warrants and represents that the information
furnished in writing by or on behalf of such Underwriter through
you to the Company expressly for use with reference to such
Underwriter in the Registration Statement at the time it became
effective or the Prospectus, or any related preliminary prospectus
does not contain an untrue statement of a material fact and does
not omit to state a material fact in connection with such
information required to be stated in the Registration Statement at
the time it became effective or the Prospectus, or any related
preliminary prospectus or necessary to make such information not
misleading. Each Underwriter, in addition to other information
furnished by such Underwriter or on its behalf through you to the
Company in writing expressly for use with reference to such
Underwriter in the Registration Statement and Prospectus, hereby
furnishes to the Company in writing expressly for use with
reference to such Underwriter the statements with respect to the
terms
10
<PAGE> 11
of offering of the Purchased Securities by the Underwriters set
forth on the cover page of the Prospectus Supplement and under
"Underwriting" therein.
b) Each Underwriter severally agrees to indemnify and hold harmless
the Company, its directors and its officers from and against any
loss, expense, liability or claim (including the reasonable fees
and expenses of counsel and other reasonable expenses in connection
with investigating, defending or settling any such claim) which
arises out of or is based upon any alleged untrue statement of a
material fact contained in, and in conformity with information
furnished in writing by or on behalf of such Underwriter through
you to the Company expressly for use with reference to such
Underwriter in, the Registration Statement, any prospectus
contained in the Registration Statement at the time it became
effective or the Prospectus, or any related preliminary prospectus,
or arises out of or is based upon any alleged omission to state a
material fact in connection with such information required to be
stated in such documents or necessary to make such information not
misleading.
If any action is brought against the Company or any such person in
respect of which indemnity may be sought against any Underwriter pursuant to the
foregoing paragraph, the Company or such person shall promptly notify such
Underwriter in writing or by telephone, confirmed in writing, of the institution
of such action and such Underwriter shall assume the defense of such action,
including the employment of counsel and payment of expenses. The Company or such
person shall have the right to employ its or their own counsel in any such case,
but the fees and expenses of such counsel shall be at the expense of the Company
or such person unless the employment of such counsel shall have been authorized
in writing by such Underwriter in connection with the defense of such action or
such Underwriter shall not have employed counsel to have charge of the defense
of such action or such indemnified party or parties shall have reasonably
concluded that there may be defenses available to it or them which are different
from or additional to those available to such Underwriter (in which case such
Underwriter shall not have the right to direct the defense of such action on
behalf of the indemnified party or parties), in any of which events such fees
and expenses for all indemnified parties of one counsel (in addition to local
counsel) selected by the Company shall be borne by such Underwriter. Anything in
this paragraph to the contrary notwithstanding, no Underwriter shall be liable
for any settlement of any such claim or action effected without the written
consent of such Underwriter. The indemnity agreement on the part of each
Underwriter contained in this Section 8(b) shall remain in full force and effect
regardless of any investigation made by or on behalf of the Company or such
person, and shall survive any termination of this Agreement or the issuance and
delivery of the Purchased Securities. Each Underwriter agrees promptly to notify
the Company of the commencement of any litigation or proceedings against such
Underwriter in connection with the issue and sale of the Purchased Securities or
with such Registration Statement or Prospectus.
9. Contribution. If the indemnification provided for in Sections 7(b) or
8(b) above is unavailable in respect of any losses, expenses,
liabilities or claims referred to therein,
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<PAGE> 12
then the parties entitled to indemnification by the terms thereof shall
be entitled to contribution to liabilities and expenses except to the
extent that contribution is not permitted under the Act or the Exchange
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 and such controlling
persons agree that it would not be equitable if the amount of such
contribution were determined by pro rata or per capita allocation (even
if the Underwriters and such controlling persons were treated as one
entity for such purpose). Notwithstanding the provisions of this Section
9, no indemnifying Underwriter shall be required to contribute any
amount in excess of the amount by which the total price at which the
Securities underwritten by such Underwriter and distributed to the
public were offered to the public exceeds the amount of any damages
which such Underwriter otherwise has been required to pay by reason of
such untrue statement or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Act) shall be entitled to contribution
from any person who was not guilty of such fraudulent misrepresentation.
The contribution agreement contained in this Section 9 shall remain in
full force and effect regardless of any investigation made by or on
behalf of any Underwriter or the Company or any of its officers or
directors or any controlling person and shall survive any termination of
this Agreement or the issuance and delivery of the Purchased Securities.
10. Notices. All statements, requests, notices and agreements shall be in
writing or by telegram and, if to the Underwriters, shall be sufficient
in all respects if delivered or sent by registered mail to the address
furnished in writing for the purpose of such statements, requests,
notices and agreements hereunder, and, if to the Company shall be
sufficient in all respects if delivered or sent by registered mail to
the Company at [Name of Issuer/Address], Attention: .
11. Construction. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York.
The section headings in this Agreement have been inserted as a matter of
convenience of reference and are not a part of this agreement.
12. Parties in Interest. The Agreement herein set forth has been and is made
solely for the benefit of the Underwriters and the Company, and the
controlling persons, directors and officers referred to in Sections 7, 8
and 9 hereof, and their respective successors, assigns, executors and
administrators, and no other person shall acquire or have any right
under or by virtue of this Agreement. Nothing in this Agreement is
intended or
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<PAGE> 13
shall be construed to give to any other person, firm or corporation
(including, without limitation, any purchaser of the Purchased
Securities from an Underwriter or any subsequent holder thereof or any
purchaser of any Contract Securities or any subsequent holder thereof)
any legal or equitable right, remedy or claim under or in respect of
this Agreement or any provision herein contained.
The term "successor" as used in this Agreement shall not include any
purchaser, as such purchaser, of any Purchased Securities from any Underwriter
or any subsequent holder thereof or any purchaser, as such purchaser, of any
Contract Securities or any subsequent holder thereof.
13. Counterparts. This Agreement may be executed in any number of
counterparts which, taken together, shall constitute one and the same
instrument.
13
<PAGE> 14
Schedule I
DELAYED DELIVERY CONTRACT
Dated: _______________, 199
[NAME OF ISSUER]
[ADDRESS]
Attention:
Dear Sirs:
The undersigned hereby agrees to purchase from [Name of Issuer] (the
"Company"), and the Company agrees to sell to the undersigned,
$___________________ principal amount of the Company's [state title of issue]
(the "Securities") offered by the Company's Prospectus dated ___________, 199__
and a Prospectus Supplement dated ___________, 199__, receipt of copies of which
is hereby acknowledged, at a purchase price of ____% of the principal amount
thereof plus accrued interest and on the further terms and conditions set forth
in this contract.
The undersigned agrees to purchase such Securities in the principal
amounts and on the delivery dates (the "Delivery" "Dates") set forth below:
Delivery Principal Plus Accrued
Date Amount Interest From:
-------- --------- --------------
- ---------------- $--------------- ----------------
- ---------------- $--------------- ----------------
- ---------------- $--------------- ----------------
Payment for the Securities which the undersigned has agreed to
purchase on each Delivery Date shall be made to the Company by wire transfer of
immediately available at Corporate Trust Office of ___________________ (or at
such other place as the undersigned and the Company shall agree) at 11:00 A.M.,
New York City Time, on such Delivery Date upon issuance and delivery to the
undersigned of the Securities to be purchased by the
14
<PAGE> 15
undersigned on such Delivery Date in such authorized denominations and, unless
otherwise provided herein, registered in such names as the undersigned may
designate by written or telegraphic communications addressed to the Company not
less than five full business days prior to such Delivery Date.
The obligation of the Company to sell and deliver, and of the
undersigned to take delivery of and make payment for, Securities on each
Delivery Date shall be subject to the conditions that (1) the purchase of
Securities to be made by the undersigned shall not at the time of delivery be
prohibited under the laws of the jurisdiction to which the undersigned is
subject, (2) the sale of the Securities by the Company pursuant to this contract
shall not at the time of delivery be prohibited under the laws of any
jurisdiction to which the Company is subject and (3) the Company shall have
sold, and delivery shall have taken place, to the Underwriters of such principal
amount of the Securities as is to be sold and delivered to them. In the event
that Securities are not sold to the undersigned because one of the foregoing
conditions is not met, the Company shall not be liable to the undersigned for
damages arising out of the transactions covered by this contract.
Promptly after completion of the sale and delivery to the Underwriters,
the Company will mail or deliver to the undersigned at its address set forth
below notice to such effect, accompanied by copies of the opinions of counsel
for the Company delivered to the Underwriters.
Failure to take delivery of and make payment for Bonds by any purchaser
under any other Delayed Delivery Contract shall not relieve the undersigned of
its obligations under this contract.
The undersigned represents and warrants that (a) as of the date of this
contract, the undersigned is not prohibited under the laws of the jurisdictions
to which the undersigned is subject from purchasing the Securities hereby agreed
to be purchased and (b) the undersigned does not contemplate selling the
Securities which it has agreed to purchase hereunder prior to the Delivery Date
therefor.
This contract will inure to the benefit of and be binding upon the
parties hereto and their respective successors, but will not be assignable by
either party hereto without the written consent of the other. This contract
shall be governed by and construed in accordance with the laws of the State of
New York. This contract may be executed in one or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
15
<PAGE> 16
It is understood that the acceptance of any Delayed Delivery Contract is
in the Company's sole discretion and, without limiting the foregoing, need not
be on a first-come, first-served basis. If the contract is acceptable to the
Company, it is requested that the Company sign the form of acceptance below and
mail or deliver one of the counterparts hereof to the undersigned at its address
set forth below. This will become a binding contract between the Company and the
undersigned when such counterpart is so signed.
Yours very truly,
____________________________________
By ____________________________________
____________________________________
____________________________________
Address
Accepted, as of the date first above written
[Name of Issuer]
By_________________________________
PURCHASER -- PLEASE COMPLETE AT TIME OF SIGNING
The name and telephone and department of the representative of the
Purchaser with whom details of delivery on the Delivery Date may be discussed
are as follows:
(Please print.)
Telephone No.
Name (Including Area Code) Department
[NAME OF ISSUER]
PURCHASE AGREEMENT
DEBT SECURITIES
_______________, 1996
16
<PAGE> 17
[Name of Issuer]
[ADDRESS]
Dear Sirs:
Referring to the Debt Securities, ______% Series due (the
"Securities"), of [Name of Issuer] (the "Company") covered by registration
statement on Form S-3 (No. 333- ), such registration statement including (i) the
prospectus included therein, dated , 1996, as supplemented by a prospectus
supplement dated ______________, 19 in the form first filed under Rule 424 and
any additional prospectus supplements relating to the Securities filed under
Rule 424 (such prospectus as so supplemented, including each document
incorporated by reference therein is hereinafter called the "Prospectus") and
(ii) all documents filed as part thereof or incorporated by reference therein,
is hereinafter called the "Registration Statement" on the basis of the
representations, warranties and agreements contained in this Agreement, but
subject to the terms and conditions herein set forth, the purchaser or
purchasers named in Schedule A hereto (the "Underwriters") severally agree to
purchase and the Company agrees to sell to each Underwriter the principal amount
of the Company's Securities having the terms described below (the "Purchased
Securities") set forth opposite the name of each Underwriter on Schedule A
hereto.
The price at which the Purchased Securities shall be purchased from
the Company by the Underwriters shall be ______%. The initial public offering
price shall be ______%. The Purchased Securities will be offered by the
Underwriters as set forth in the Prospectus relating to such Purchased
Securities.
The Purchased Securities will have the following terms:
Title of Securities: ____________________________
Interest rate: ____________________________
Interest Payment Dates: ____________________________
____________________________
____________________________
____________________________
____________________________
Maturity: ____________________________
Redemption Provisions: ____________________________
____________________________
____________________________
17
<PAGE> 18
Other:
____________________________
____________________________
____________________________
____________________________
____________________________
____________________________
____________________________
Payment for the Purchased Securities shall be made in the following
funds: ____________________________
The time of purchase shall be: ____________________________
The place(s) at which the Purchased Securities shall be delivered and
sold shall be: ____________________________
Delayed Delivery Contracts: ______________________________
Notices to the Underwriters shall be sent to the following address or
telecopier number:
If we are acting as Representative(s) for the several Underwriters
named in Schedule A hereto, we represent that we are authorized to act for such
several Underwriters in connection with the transactions contemplated in this
Agreement, and that, if there are more than one of us, any action under this
Agreement taken by any of us will be binding upon all the Underwriters.
All of the provisions contained in the document entitled "[Name of
Issuer] Standard Purchase Provisions - Debt Securities," a copy of which has
been previously furnished to us, are hereby incorporated by reference in their
entirety and shall be deemed to be a part of this Agreement to the same extent
as if such provisions had been set forth in full herein.
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 each Underwriter in
accordance with its terms.
Very truly yours,
18
<PAGE> 19
[Firm Name]
By ________________________________
Title:
[Firm Name]
By ________________________________
Title:
Acting on behalf of and as
Representative(s) of the
several Underwriters named
in Schedule A hereto.*
The foregoing Purchase Agreement is hereby confirmed as of the date first above
written.
[NAME OF ISSUER]
By ___________________________
Title:
- ------------------
* To be deleted if the Purchase Agreement is not executed by one or more
Underwriters acting as Representative(s) of the Underwriters for purposes of
this Agreement.
19
<PAGE> 1
EXHIBIT B-3
CONECTIV
$-----------
Medium-Term Notes, Series __
DISTRIBUTION AGREEMENT
[insert date]
[insert names and addresses of agents]
Ladies and Gentlemen:
Conectiv, a Delaware corporation (the "Company"), proposes to issue and
sell from time to time its Medium Term Notes, Series __ (the "Securities"), in
an aggregate amount up to [insert aggregate principal amount] and agrees with
each of you (individually, an "Agent", and collectively, the "Agents") as set
forth in this Agreement.
Subject to the terms and conditions stated herein and to the reservation
by the Company of the right to sell Securities directly on its own behalf, the
Company hereby (i) appoints each Agent as an agent of the Company for the
purpose of soliciting and receiving offers to purchase Securities from the
Company pursuant to Section 2(a) hereof and (ii) agrees that, except as
otherwise contemplated herein, whenever it determines to sell Securities
directly to any Agent, as principal, it will enter into a separate agreement
(each a "Terms Agreement") in accordance with Section 2(b) hereof.
The Securities will be issued under an Indenture, dated as of [insert
date], as it may be supplemented and amended (the "Indenture"), between the
Company and [insert name of trustee], as Trustee (the "Trustee"). The Securities
shall have the maturity ranges, interest rates, redemption provisions and other
terms set forth in the Prospectus referred to below as it may be amended or
supplemented from time to time. The Securities will be issued, and the terms and
rights thereof established, from time to time by the Company in accordance with
the Indenture.
1. Representations and Warranties of the Company. The Company represents and
warrants to, and agrees with, each Agent that:
(a) A registration statement (No. ), together with amendments thereto, if
any, with respect to the Securities has been prepared by the Company and
filed with the Securities
<PAGE> 2
-2-
and Exchange Commission (the "Commission") in conformity with the rules,
regulations and releases of the Commission (the "Rules and Regulations")
under the Securities Act of 1933, as amended (the "Act"). Such
registration statement has been declared effective by the Commission and
the Indenture has been qualified under the Trust Indenture Act of 1939,
as amended (the "Trust Indenture Act"). Copies of such registration
statement, together with all amendments thereto, if any, have heretofore
been delivered to each Agent, and copies of any amendments thereto,
including the exhibits filed therewith, which shall be filed subsequent
to the date hereof also will be delivered to each Agent. Such
registration statement, including all exhibits thereto but excluding the
Statement of Eligibility of the Trustee, as amended at the time it became
effective, is hereinafter called the "Registration Statement" (any
preliminary prospectus included in such registration statement being
hereinafter called a "Preliminary Prospectus"); the prospectus
(including, if applicable, any prospectus supplement) relating to the
Securities, in the form in which it most recently has been filed with the
Commission on or prior to the date of this Agreement is hereinafter
called the "Prospectus"; any reference herein to the Registration
Statement, any Preliminary Prospectus or the Prospectus shall be deemed
to refer to and include the documents filed by the Company under the
Securities Exchange Act of 1934, as amended (the "Exchange Act") and
incorporated by reference therein (the "Incorporated Documents") as of
the date of such Registration Statement, Preliminary Prospectus or
Prospectus, as the case may be; any reference to any amendment or
supplement to any Preliminary Prospectus or the Prospectus, including any
supplement to the Prospectus that sets forth only the terms of a
particular issue of the Securities (a "Pricing Supplement"), shall be
deemed to refer to and include the Incorporated Documents as of the date
of such amendment or supplement; and any reference to the Prospectus as
amended or supplemented shall be deemed to refer to and include the
Prospectus as then amended or supplemented (including the applicable
Pricing Supplement) in relation to a particular issue of Securities, in
the form filed with the Commission pursuant to Rule 424(b) under the Act,
including any Incorporated Documents as of the date of such filing.
(b) No stop order suspending the effectiveness of the Registration Statement
nor any order preventing or suspending use of the Prospectus nor any
order directed to the adequacy or accuracy of any Incorporated Document
has been issued by the Commission, and no proceeding for any such purpose
has been initiated or is pending or, to the knowledge of the Company, is
contemplated by the Commission.
(c) On the date hereof and at and as of any Solicitation Time (as defined in
Section 6) and any Time of Delivery (as defined in Section 2), (i) the
Registration Statement and the Prospectus contain, and any amendment or
supplement thereto will contain, all statements and information which are
required to be included therein by the Act and the Rules and Regulations
and the Registration Statement and the Prospectus conform, and any
amendment of supplement thereto will conform, in all material respects,
to the requirements of the Act and the Rules and Regulations; (ii) the
Indenture conforms, and any amendment or supplement thereto will conform,
in all material respects, to the
<PAGE> 3
-3-
requirements of the Trust Indenture Act; (iii) the Registration Statement
does not, and any amendment thereto will not, 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; and (iv) the Prospectus does not, and any amendment or
supplement thereto will not, include any 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 this representation
and warranty shall not apply to any statements or omissions made in
reliance upon and in conformity with information furnished in writing to
the Company by any Agent expressly for use in the Prospectus as amended
or supplemented to relate to a particular issuance of Securities or to
any statement in or omissions from the Statement of Eligibility of the
Trustee under the Indenture. There are no contracts or documents of the
Company or of any Subsidiary (as defined below) which are required to be
filed as exhibits to the Registration Statement by the Act or by the
Rules and Regulations which have not been filed as required.
(d) The Company has filed timely all reports and all definitive proxy and
information statements required to be filed by the Company with the
Commission pursuant to the Exchange Act and the rules and regulations of
the Commission thereunder. Each of the Incorporated Documents, when it
and when any amendment thereto was filed with the Commission, complied as
to form in all material respects to the requirements of the Exchange Act,
and the rules and regulations of the Commission thereunder, and any
Incorporated Document and any amendment thereto, when filed with the
Commission, will comply as to form in all material respects to the
requirements of the Exchange Act and the rules and regulations of the
Commission thereunder; and none of such documents includes or will
include any untrue statement of a material fact or omits or will omit to
state any material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances under
which they were made, not misleading.
(e) The Company has been duly organized and is validly existing as a
corporation in good standing under the laws of Delaware, with all
corporate power and other authority, including franchises, necessary to
own or lease its properties and conduct its business as described in the
Registration Statement and the Prospectus and to issue and sell the
Securities. The Company is not qualified to do business as a foreign
corporation or in any other jurisdiction and the conduct of its business
or its ownership or leasing of properties requires no such qualification.
(f) The issue and sale of the Securities, the compliance by the Company with
all of the provisions of the Securities, the Indenture, this Agreement,
the Administrative Procedure (as defined in Section 2 hereof) and any
Terms Agreement, and the consummation of the transactions herein and
therein contemplated will not conflict with or result in a breach or
violation of any of the terms or provisions of, or constitute a default
under, the Indenture or any indenture, mortgage, deed of trust, loan
agreement or other agreement or
<PAGE> 4
-4-
instrument to which the Company is a party or by which it is bound or to
which any of its property or assets is subject, or the Company's Articles
of Incorporation or the By-Laws, 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.
(g) The Company has full power and lawful authority to authorize, issue and
sell the Securities on the terms and conditions herein set forth; has
taken all corporate action necessary therefor; and has obtained every
consent, approval, authorization and other order of any regulatory body
which is required for such authorization, issue or sale, except as may be
required under state securities laws; and such consents, approvals,
authorizations and other orders are in full force and effect and are not
subject to appeal.
(h) The Company is not an "investment company" or an entity "controlled" by
an "investment company" as such terms are defined in the Investment
Company Act of 1940, as amended.
(i) Immediately after any sale of Securities by the Company hereunder or
under any Terms Agreement, the aggregate amount of Securities which shall
have been issued and sold by the Company hereunder or under any Terms
Agreement will not exceed the amount of Securities registered under the
Act.
(j) This Agreement has been, and any Terms Agreement will have been, duly
authorized and entered into by the Company.
2. Obligations of the Agents and the Company.
(a) On the basis of the representations and warranties and subject to the
terms and conditions herein set forth, each of the Agents hereby
severally and not jointly agrees, as agent of the Company, to use its
best efforts to solicit and receive offers to purchase the Securities
from the Company upon the terms and conditions set forth in the
Prospectus as amended or supplemented from time to time. So long as this
Agreement shall remain in effect with respect to any Agent, the Company
shall not, without the consent of such Agent, solicit or accept offers to
purchase, or sell, any debt securities with a maturity at the time of
original issuance of 9 months to 40 years except pursuant to this
Agreement, any Terms Agreement or a private placement not constituting a
public offering under the Act, or except in connection with a firm
commitment underwriting pursuant to an underwriting agreement that does
not provide for a continuous offering of medium-term debt securities.
However, the Company reserves the right to sell, and may solicit and
accept offers to purchase, Securities directly on its own behalf, and, in
the case of any such sale not resulting from a solicitation made by any
Agent, no commission will be payable with respect to such sale. These
provisions shall not limit Section 4(f) hereof or any similar provision
included in any Terms Agreement.
<PAGE> 5
-5-
Procedural details relating to the issue and delivery of Securities, the
solicitation of offers to purchase Securities and the payment therefor
shall be as set forth in the Administrative Procedure attached hereto as
Annex II as it may be amended from time to time by written agreement
between the Agents and the Company (the "Administrative Procedure"). The
provisions of the Administrative Procedure shall apply to all
transactions contemplated hereunder other than those made pursuant to a
written Terms Agreement. Each Agent and the Company agree to perform the
respective duties and obligations specifically provided to be performed
by each of them in the Administrative Procedure. The Company will furnish
to the Trustee a copy of the Administrative Procedure as from time to
time in effect.
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 Securities. As soon as
practicable, but in any event not later than one business day, after
receipt of notice from the Company, the Agents will suspend solicitation
of offers to purchase Securities from the Company until such time as the
Company has advised the Agents that such solicitation may be resumed.
The Company agrees to pay each Agent a commission, at the time of
settlement of any sale of a Security by the Company as a result of a
solicitation made by such Agent, in an amount equal to the following
applicable percentage of the principal amount of such Security sold
(except that the Company and such Agent may agree in writing to a higher
commission for maturities in excess of 30 years):
<TABLE>
<CAPTION>
COMMISSION
(PERCENTAGE OF
AGGREGATE
PRINCIPAL AMOUNT)
RANGE OF MATURITIES OF SECURITIES SOLD
<S> <C>
From 9 months to less than 1 year..............................
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............................
20 years and more..............................................
</TABLE>
(b) Each sale of Securities to any Agent as principal shall be made in
accordance with the terms of this Agreement and a Terms Agreement which
will provide for the sale of such
<PAGE> 6
-6-
Securities to, and the purchase thereof by, such Agent. A Terms Agreement
may be either (i) a written agreement between one or more of the Agents
and the Company, which may be substantially in the form of Annex I
hereto, or (ii) an oral agreement between any Agent and the Company
confirmed in writing by such Agent. Each Terms Agreement shall contain
the information specified in the Administrative Procedure under the
caption, "Communication of Sale Information to Company by Agent", and may
specify certain terms of the reoffering of the Securities. The commitment
of any Agent to purchase Securities as principal 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 specify the time and date and place of delivery
of and payment for such Securities. Unless otherwise specified in a Terms
Agreement, the procedural details relating to the issue and delivery of such
Securities and payment therefor shall be as set forth in the Administrative
Procedure.
Each time and date of delivery of and payment for Securities to be
purchased by an Agent as principal, whether set forth in a Terms Agreement or
in accordance with the Administrative Procedure, is referred to herein as a
"Time of Delivery".
Unless otherwise specified in a Terms Agreement, an Agent purchasing
Securities as principal may resell such Securities to dealers. Any such sales
may be at a discount, which shall not exceed the amount set forth in the
Pricing Supplement relating to such Securities.
3. Commencement. The documents required to be delivered pursuant to Section 6
hereof on the Commencement Date (as defined below) shall be delivered to the
Agents at the offices [insert place of closing] at or before 12:00 noon, New
York City time, on the date of this Agreement, which date and time of such
delivery may be postponed by agreement between the Agents and the Company but
in no event shall be later than the day prior to the date on which
solicitation of offers to purchase Securities is commenced or on which any
Terms Agreement is executed (such time and date being referred to herein as
the "Commencement Date").
<PAGE> 7
-7-
4. Covenants of the Company. The Company covenants and agrees with each Agent:
(a) (i) To make no amendment or supplement to the Registration Statement or
the Prospectus (A) prior to the Commencement Date, to which any Agent
shall reasonably object after reasonable notice thereof or (B) after the
date of any Terms Agreement by an Agent to purchase Securities as
principal and prior to the related Time of Delivery, to which any Agent
party to such Terms Agreement or so purchasing as principal shall
reasonably object after reasonable notice thereof; (ii) to prepare, with
respect to each particular issue of Securities to be sold through or to
such Agent pursuant to this Agreement, a Pricing Supplement with respect
to such Securities in a form previously approved by such Agent and to
file such Pricing Supplement pursuant to Rule 424(b) under the Act; (iii)
to make no amendment or supplement to the Registration Statement or
Prospectus, other than any Pricing Supplement, at any time prior to
having afforded each Agent a reasonable opportunity to review and comment
on it; (iv) to file timely all reports and any definitive proxy or
information statements required to be filed by the Company with the
Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange
Act for so long as the delivery of a prospectus is required in connection
with the offering or sale of the Securities, and during such same period
to advise such Agent, promptly after the Company receives notice thereof,
of the time when any amendment to the Registration Statement has been
filed or has become effective or any supplement to the Prospectus or any
amended Prospectus (other than any Pricing Supplement that relates to
Securities not purchased through or by such Agent) has been filed with
the Commission, of the issuance by the Commission of any stop order or of
any order preventing or suspending the use of any prospectus relating to
the Securities, of the suspension of the qualification of the Securities
for offering or sale in any jurisdiction, of the initiation or
threatening of any proceeding for any such purpose, or of any request by
the Commission for the amendment or supplement of the Registration
Statement or Prospectus or for additional information; and (v) in the
event of the issuance of any such stop order or of any such order
preventing or suspending the use of any such prospectus or suspending any
such qualification, to use promptly its best efforts to obtain its
withdrawal;
(b) Promptly, from time to time, to take such action as such Agent reasonably
may request to qualify the Securities for offering and sale under the
securities laws of such jurisdictions as such Agent may request and to
comply with such laws so as to permit the continuance of sales and
dealings therein for as long as may be necessary to complete the
distribution or sale of the Securities; provided, however, that in
connection therewith 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 or to submit to any requirements which it deems unduly
burdensome;
(c) To furnish such Agent with copies of the Registration Statement and each
amendment thereto, and with copies of the Prospectus as amended or
supplemented, other than any
<PAGE> 8
-8-
Pricing Supplement (except as provided in the Administrative Procedure),
in the form in which it is filed with the Commission pursuant to Rule
424(b) under the Act, both in such quantities as such Agent may
reasonably request from time to time; and, if the delivery of a
prospectus is required at any time in connection with the offering or
sale of the Securities (including Securities purchased from the Company
by such Agent as principal) and if at such time any event shall have
occurred 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 in order to make the statements
therein, in the light of the circumstances under which they were made
when such Prospectus is delivered, not misleading, or, if for any other
reason it shall be necessary during such same period to amend or
supplement the Prospectus or to file under the Exchange Act any document
incorporated by reference in the Prospectus in order to comply with the
Act, the Exchange Act or the Trust Indenture Act, to notify such Agent
and request such Agent, in its capacity as agent of the Company, to
suspend solicitation of offers to purchase Securities from the Company
(and, if so notified, such Agent shall cease such solicitations as soon
as practicable, but in any event not later than one business day later);
and if the Company shall decide to amend or supplement the Registration
Statement or the Prospectus as then amended or supplemented, to so advise
such Agent promptly by telephone (with confirmation in writing) and to
prepare and cause to be filed promptly with the Commission an amendment
or supplement to the Registration Statement or the Prospectus as then
amended or supplemented that will correct such statement or omission or
effect such compliance; provided, however, that if during such same
period such Agent continues to own Securities purchased from the Company
by such Agent as principal or such Agent is otherwise required to deliver
a prospectus in respect of transactions in the Securities, the Company
shall promptly prepare and file with the Commission such an amendment or
supplement;
(d) To make generally available to its security holders as soon as
practicable, but in any event not later than eighteen months after (i)
the effective date of the Registration Statement, (ii) the effective date
of each post-effective amendment to the Registration Statement, and (iii)
the date of each filing by the Company with the Commission of an Annual
Report on Form 10-K that is incorporated by reference in the Registration
Statement, an earnings statement of the Company and its subsidiaries
(which need not be audited) complying with Section 11(a) of the Act and
the rules and regulations of the Commission thereunder (including, at the
option of the Company, Rule 158);
(e) For a period of five years from the date any Securities are sold by the
Company pursuant to an offer solicited by such Agent under this
Agreement, to deliver to such Agent (i) as soon as available, a copy of
each report of the Company mailed to security holders or filed with the
Commission and (ii) from time to time such other information concerning
the Company as such Agent shall reasonably request. If at any time, the
Company shall have a majority-owned subsidiary or subsidiaries which is
or are "significant" within the meaning of Regulation S-X of the
Commission, the financial statements contained in the documents referred
to in (i) shall be furnished in consolidated form, if such consolidation
<PAGE> 9
-9-
is required under such Regulation S-X, for the Company and such
subsidiary or subsidiaries;
(f) That, between the date of any Terms Agreement with an Agent and the
related Time of Delivery, the Company will not, without the prior written
consent of such Agent, offer, sell, contract to sell or otherwise dispose
of any debt securities of the Company substantially similar to the
Securities (other than (i) Securities that are to be sold pursuant to
such Terms Agreement, (ii) Securities previously agreed to be sold by the
Company and (iii) commercial paper issued in the ordinary course of
business), except as may otherwise be provided in such Terms Agreement;
(g) That each acceptance by the Company of an offer to purchase Securities
hereunder (including any purchase by such Agent as principal pursuant to
a Terms Agreement) shall be deemed to be an affirmation to such Agent
that the representations and warranties of the Company contained in or
made pursuant to this Agreement are true and correct as of the date of
such acceptance as though made at and as of such date, and an undertaking
that such representations and warranties will be true and correct as of
the settlement date for the Securities relating to such acceptance or as
of the Time of Delivery relating to such purchase pursuant to a Terms
Agreement, as the case may be, as though made at and as of such date
(except that such representations and warranties shall be deemed to
relate to the Registration Statement and the Prospectus as amended and
supplemented relating to such Securities);
5. Payment of Expenses. The Company covenants and agrees with each Agent that
the Company will pay or cause to be paid the following: (i) the fees and
expenses of the Company's counsel and accountants in connection with the
registration of the Securities under the Act and all other expenses in
connection with the preparation, printing and filing of the Registration
Statement, any Preliminary Prospectus, the Prospectus and any Pricing
Supplement and all other amendments and supplements thereto and the mailing
and delivering of copies thereof to such Agent; (ii) the fees and expenses of
counsel for the Agents in connection with the establishment of the program
contemplated hereby, any opinions to be rendered by such counsel hereunder
and the continuing advice and services of such counsel in connection with the
transactions contemplated hereunder; (iii) the cost of printing, preparing by
word processor or reproducing this Agreement, any Terms Agreement, any
Indenture, any Blue Sky and Legal Investment Memoranda and any other
documents in connection with the offering, purchase, sale and delivery of the
Securities; (iv) all expenses in connection with the qualification of the
Securities for offering and sale under state securities laws as provided in
Section 4(b) hereof, including fees and disbursements of counsel for the
Agents in connection with such qualification and in connection with the Blue
Sky and legal investment surveys; (v) any fees charged by securities rating
services for rating the Securities; (vi) any filing fees incident to any
required review by the National Association of Securities Dealers, Inc. of
the terms of the sale of the Securities; (vii) the cost of preparing the
Securities; (viii) the fees and expenses of any Trustee and any agent of any
Trustee and any
<PAGE> 10
-10-
transfer or paying agent of the Company and the fees and disbursements of
counsel for any Trustee or such agent in connection with any Indenture and
the Securities; (ix) the out-of-pocket expenses of the Agents incurred in
connection with the implementation of the program for the offer and sale of
the Securities; and (x) all other costs and expenses incident to the
performance of the Company's obligations hereunder which are not otherwise
specifically provided for in this Section. Except as provided in Sections 7
and 8 hereof, each Agent shall pay all other expenses it incurs.
6. Conditions of Agents' Obligations. The obligation of any Agent, as agent of
the Company, at any time ("Solicitation Time") to solicit offers to purchase
the Securities and the obligation of any offeree to purchase Securities or of
any Agent to purchase Securities as principal, pursuant to any Terms
Agreement, shall in each case be subject, in such offeree's or Agent's
discretion, to the condition that all representations and warranties and
other statements of the Company herein (and, in the case of an obligation of
an Agent under a Terms Agreement, contained in or incorporated in such Terms
Agreement by reference) are true and correct at and as of the Commencement
Date and any applicable date that is on or prior to such Solicitation Time or
Time of Delivery, as the case may be, and at and as of such Solicitation Time
or Time of Delivery, as the case may be, the condition that on or prior to
such Solicitation Time or Time of Delivery, as the case may be, the Company
shall have performed all of its obligations hereunder theretofore to be
performed, and the following additional conditions:
(a) (i) With respect to any Securities sold at or prior to such Solicitation
Time or Time of Delivery, as the case may be, the Prospectus as amended
or supplemented (including the Pricing Supplement) with respect to such
Securities shall have been filed with the Commission pursuant to Rule
424(b) under the Act within the applicable time period prescribed for
such filing by the rules and regulations under the Act and in accordance
with Section 4(a) hereof; (ii) no stop order suspending the effectiveness
of the Registration Statement shall have been issued and shall remain in
effect and no proceeding for that purpose shall have been initiated or
threatened by the Commission; and (iii) all requests for additional
information on the part of the Commission shall have been complied with
to the reasonable satisfaction of such Agent;
(b) Counsel to the Agents shall have furnished to such Agent (i) such opinion
or opinions, dated the Commencement Date, with respect to the
incorporation of the Company, the validity of the Indenture, the
Securities, the Registration Statement and the Prospectus as amended or
supplemented and (ii) if and to the extent requested by such Agent, on or
prior to such Solicitation Time or Time of Delivery, as the case may be,
a letter, dated such applicable date, to the effect that such Agent may
rely on the opinion or opinions which were last furnished to such Agent
pursuant to this Section 6(b) to the same extent as though it or they
were dated the date of such letter authorizing reliance (except that the
statements in such letter shall be deemed to relate to the Registration
Statement and the Prospectus as amended and supplemented to such date)
or, in any case, in lieu of such a letter, an opinion or opinions of the
same tenor as the opinion or opinions referred to in
<PAGE> 11
-11-
clause (i) but modified to relate to the Registration Statement and the
Prospectus as amended and supplemented to such date; and in each case
such counsel shall have received such papers and information as they may
reasonably request to enable them to pass upon such matters;
(c) General Counsel for the Company, or other counsel for the Company
satisfactory to such Agent, shall have furnished to such Agent his
written opinions, dated the Commencement Date and each applicable date
that is on or prior to such Solicitation Time or Time of Delivery, as the
case may be, in form and substance satisfactory to such Agent and the
Company.
(d) The independent certified public accountants who have certified the
financial statements of the Company and its subsidiaries included or
incorporated by reference in the Registration Statement shall have
furnished to such Agent a letter, dated the Commencement Date and each
applicable date that is on or prior to such Solicitation Time or Time of
Delivery, as the case may be, in form and substance satisfactory to such
Agent to the effect set forth in Annex III hereto;
(e) There shall not have occurred any:
(i) change, or any development involving a prospective change, in the
condition, financial or otherwise, or in the earnings, business or
operations, of the Company and its subsidiaries, taken as a whole,
from that set forth in the Prospectus, as amended or supplemented
at such Solicitation Time or Time of Delivery, as the case may be,
that, in such Agent's judgment, is material and adverse and that
makes it, in such Agent's judgment, impracticable to market the
Securities on the terms and in the manner contemplated by the
Prospectus, as so amended or supplemented;
(ii) suspension or material limitation of trading generally on or by, as
the case may be, the New York Stock Exchange, the American Stock
Exchange, the National Association of Securities Dealers, Inc., the
Chicago Board Options Exchange, the Chicago Mercantile Exchange or
the Chicago Board of Trade, (B) suspension of trading of any
securities of the Company on any exchange or in any
over-the-counter market, (C) declaration of a general moratorium on
commercial banking activities in New York by either Federal or New
York State authorities or (D) any outbreak or escalation of
hostilities or any change in financial markets or any calamity or
crisis that, in such Agent's judgment, is material and adverse and,
in the case of any of the events described in clauses (A) through
(D), such event, singly or together with any other such event,
makes it, in such Agent's judgment, impracticable to market the
Securities on the terms and in the manner contemplated by the
Prospectus, as amended or supplemented at such Solicitation Time or
Time of Delivery, as the case may be; and
<PAGE> 12
-12-
(iii) downgrading in the rating accorded any of the Company's securities
by any "nationally recognized statistical rating organization," as
such term is defined for purposes of Rule 436(g)(2) under the
Securities Act;
Except, in each case, as disclosed to such Agent in writing by the Company
prior to such Solicitation Time, or unless in each case described in (ii)
above, the relevant event shall have occurred and been known to such Agent
prior to such Solicitation Time, as the case may be.
(f) The Company shall have furnished or caused to be furnished to such Agent
certificates of officers of the Company dated the Commencement Date and
each applicable date that is on or prior to such Solicitation Time or
Time of Delivery, as the case may be, in such form and executed by such
officers of the Company as shall be satisfactory to such Agent, as to the
accuracy of the representations and warranties of the Company herein at
and as of the Commencement Date or such applicable date, as the case may
be, as to the performance by the Company of all of its obligations
hereunder to be performed at or prior to the Commencement Date or such
applicable date, as the case may be, as to the matters set forth in
subsections (a) and (e) of this Section 6, and as to such other matters
as such Agent may reasonably request.
7. Indemnification.
(a) The Company will indemnify and hold harmless each Agent, and each person,
if any, who controls such Agent within the meaning of the Act, against
any losses, claims, damages or liabilities, joint or several, to which
such Agent 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 any Preliminary
Prospectus, the Registration Statement, the Prospectus, the Prospectus as
amended or supplemented or any other prospectus relating to the
Securities, 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 such Agent for any
legal or other expenses reasonably incurred by it in connection with
investigating or defending any such action or claim as such expenses are
incurred; 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 or omission or alleged omission made in any Preliminary
Prospectus, the Registration Statement, the Prospectus, the Prospectus as
amended or supplemented or any other prospectus relating to the
Securities, or any such amendment or supplement, in reliance upon and in
conformity with written information furnished to the Company by such
Agent expressly for use therein, and provided, further, that the
indemnity agreement contained in this paragraph in respect of any
Preliminary Prospectus shall not inure to the benefit of either Agent on
account of any such losses, claims, damages or liabilities arising from
the sale of the Securities to any offeree if such Agent failed to send or
give a copy of the Prospectus as amended or supplemented
<PAGE> 13
-13-
(excluding documents incorporated therein by reference), if any
amendments or supplements thereto shall have been furnished, at or prior
to the time of written confirmation of the sale involved, to such offeree
with or prior to the written confirmation of such sale.
(b) Each Agent 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 any Preliminary Prospectus, the Registration
Statement, the Prospectus, the Prospectus as amended or supplemented or
any other prospectus relating to the Securities, 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 any Preliminary Prospectus, the Registration Statement, the
Prospectus, the Prospectus as amended or supplemented or any other
prospectus relating to the Securities, or any such amendment or
supplement, in reliance upon and in conformity with written information
furnished to the Company by such Agent 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 as such expenses are incurred.
(c) In case any proceeding (including any governmental investigation) shall
be instituted involving any person in respect of which indemnity may be
sought pursuant to either paragraph (a) or (b) above, such person (the
"indemnified party") shall promptly notify the person against whom such
indemnity may be sought (the "indemnifying party") in writing and the
indemnifying party, upon request of the indemnified party, shall retain
counsel reasonably satisfactory to the indemnified party to represent the
indemnified party and any others the indemnifying party may designate in
such proceeding and shall pay the reasonable fees and disbursements of
such counsel related to such proceeding. In any such proceeding, any
indemnified party shall have the right to retain its own counsel, but the
fees and expenses of such counsel shall be at the expense of such
indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel or (ii)
the named parties to any such proceeding (including any impleaded
parties) include both the indemnifying party and the indemnified party
and representation of both parties by the same counsel would be
inappropriate due to actual or potential differing interests between
them; provided, however, that the indemnifying party shall only be
responsible for the fees of such counsel to the extent they are
reasonably incurred. It is understood that the indemnifying party shall
not, in respect of the legal expenses of any indemnified party in
connection with any proceeding or related proceedings in the same
jurisdiction, be liable for the fees and expenses of more than one
separate firm (in addition to any local counsel) for all such indemnified
parties and that all such fees and expenses, to the extent they are
<PAGE> 14
-14-
reasonable, shall be reimbursed as they are incurred. Such firm shall be
designated in writing by the Agents, in the case of parties indemnified
pursuant to paragraph (a) above, and by the Company, in the case of
parties indemnified pursuant to paragraph (b) above. The indemnifying
party shall not be liable for any settlement of any proceeding effected
without its written consent, but if settled with such consent or if there
be a final judgment for the plaintiff, the indemnifying party agrees to
indemnify the indemnified party from and against any loss or liability by
reason of such settlement or judgment. No indemnifying party shall,
without the prior written consent of the indemnified party, effect any
settlement of any pending or threatened proceeding in respect of which
any indemnified party is or could have been a party and indemnity could
have been sought hereunder by such indemnified party, unless such
settlement includes an unconditional release of such indemnified party
from all liability on claims that are the subject matter of such
proceeding.
(d) If the indemnification provided for in this Section 7 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 each Agent on the other from the offering of the
Securities to which such loss, claim, damage or liability (or action in
respect thereof) relates. If, however, the allocation provided by the
immediately preceding sentence is not permitted by applicable law, then
each indemnifying party shall contribute to such amount paid or payable
by such indemnified party in such proportion as is appropriate to reflect
not only such relative benefits but also the relative fault of the
Company on the one hand and each Agent on the other in connection with
the statements or omissions which resulted in such losses, claims,
damages or liabilities (or actions in respect thereof), as well as any
other relevant equitable considerations. The relative benefits received
by the Company on the one hand and each Agent on the other shall be
deemed to be in the same proportion as the total net proceeds from the
sale of Securities (before deducting expenses) received by the Company
bear to the total commissions or discounts received by such Agent in
respect thereof. The relative fault shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material
fact required to be stated therein or necessary in order to make the
statements therein not misleading relates to information supplied by the
Company on the one hand or by any Agent 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 each Agent
agree that it would not be just and equitable if contribution pursuant to
this subsection (d) were determined by per capita allocation (even if all
Agents 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
<PAGE> 15
-15-
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. Notwithstanding the
provisions of this subsection (d), an Agent shall not be required to
contribute any amount in excess of the amount by which the total public
offering price at which the Securities purchased by or through it were
sold exceeds the amount of any damages which such Agent has otherwise
been required to pay by reason of such untrue or alleged untrue statement
or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall
be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The obligations of each of the Agents under
this subsection (d) to contribute are several in proportion to the
respective purchases made by or through it to which such loss, claim,
damage or liability (or action in respect thereof) relates and are not
joint.
(e) The obligations of the Company under this Section 7 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 Agent within the meaning of the Act; and the obligations of each
Agent under this Section 7 shall be in addition to any liability which
such Agent 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.
8. Nonperformance. Each Agent, in soliciting offers to purchase Securities from
the Company and in performing the other obligations of such Agent hereunder
(other than in respect of any purchase by an Agent as principal, pursuant to
a Terms Agreement or otherwise), is acting solely as agent for the Company
and not as principal. Each Agent will make reasonable efforts to assist the
Company in obtaining performance by each purchaser whose offer to purchase
Securities from the Company was solicited by such Agent and has been accepted
by the Company, but such Agent shall not have any liability to the Company in
the event such purchase is not consummated for any reason. If the Company
shall default on its obligation to deliver Securities to a purchaser whose
offer it has accepted, the Company shall (i) hold each Agent harmless against
any loss, claim or damage arising from or as a result of such default by the
Company and (ii) notwithstanding such default, pay to the Agent that
solicited such offer any commission to which it would be entitled in
connection with such sale.
9. Survival of Agreement. The respective indemnities, agreements,
representations, warranties and other statements by any Agent and the Company
set forth in or made pursuant to this Agreement shall remain in full force
and effect regardless of any investigation (or any statement as to the
results thereof) made by or on behalf of any Agent or any controlling person
of any Agent or the Company, or any officer or director or any controlling
person of the Company, and shall survive each delivery of and payment for any
of the Securities.
<PAGE> 16
-16-
10. Suspension or Termination. The provisions of this Agreement relating to the
solicitation of offers to purchase Securities from the Company may be
suspended or terminated at any time by the Company as to any Agent or by any
Agent as to such Agent upon the giving of written notice of such suspension
or termination to such Agent or the Company, as the case may be. In the
event of such suspension or termination with respect to any Agent, (i) this
Agreement shall remain in full force and effect with respect to any Agent as
to which such suspension or termination has not occurred, (ii) this
Agreement shall remain in full force and effect with respect to the rights
and obligations of any party which have previously accrued or which relate
to Securities which are already issued, agreed to be issued or the subject
of a pending offer at the time of such suspension or termination and (iii)
in any event, this Agreement shall remain in full force and effect insofar
as the fourth paragraph of Section 2(a), Section 4(d), Section 4(e), Section
5, Section 7, Section 8 and Section 9 hereof are concerned.
11. Notices. Except as otherwise specifically provided herein or in the
Administrative Procedure, all statements, requests, notices and advices
hereunder shall be in writing, or by telephone if promptly confirmed in
writing, and if to _____________________, shall be sufficient in all
respects when delivered or sent by facsimile transmission or registered mail
to ______________________________________________________________,
Attention: _________________________________, Facsimile Transmission No.
_____________, and if to ___________________________, shall be sufficient in
all respects when delivered or sent by facsimile transmission or registered
mail to __________________________________, Facsimile Transmission No.
_______________________, Attention: _______________________________, and if
to the Company shall be sufficient in all respects when delivered or sent by
facsimile transmission or registered mail to Conectiv, 800 King Street,
Wilmington, Delaware 19899, Facsimile Transmission No. (302) 429-3119,
Attention: Treasurer.
12. Benefit of Agreement. This Agreement and any Terms Agreement shall be
binding upon, and inure solely to the benefit of, each Agent and the
Company, and to the extent provided in Section 7, Section 8 and Section 9
hereof, the officers and directors of the Company and any person who
controls any Agent or the Company, and their respective personal
representatives, successors and assigns, and no other person shall acquire
or have any right under or by virtue of this Agreement or any Terms
Agreement. No purchaser of any of the Securities through or from any Agent
hereunder shall be deemed a successor or assign by reason of such purchase.
13. Definition of Business Day. Time shall be of the essence in this Agreement
and any Terms Agreement. As used herein, the term "business day" shall mean
any day when the office of the Commission in Washington, D.C. and banks
located in the City of New York are normally open for business.
14. Governing Law. This Agreement and any Terms Agreement shall be governed by,
and construed in accordance with, the laws of the State of New York without
regard to the conflict of law provisions thereof.
<PAGE> 17
-17-
15. Execution in Counterparts. This Agreement and any written Terms Agreement
may be executed by any one or more of the parties hereto and thereto in any
number of counterparts, each of which shall be an original, but all of such
respective counterparts shall together constitute one and the same
instrument.
<PAGE> 18
-18-
If the foregoing is in accordance with your understanding, please sign
and return to us two counterparts hereof, whereupon this letter and the
acceptance by each of you thereof shall constitute a binding agreement between
the Company and each of you in accordance with its terms.
Very truly yours,
CONECTIV
By:
----------------------------------
Title:
-------------------------------
Accepted in New York, New York,
as of the date hereof:
[AGENT]
By
----------------------------------
Title:
------------------------------
[AGENT]
By:
---------------------------------
Title:
------------------------------
<PAGE> 19
-19-
ANNEX I
CONECTIV
MEDIUM TERM NOTES, SERIES __
TERMS AGREEMENT
___________, 199_
[Agent]
Dear Sirs:
Conectiv (the "Company") proposes, subject to the terms and conditions
stated herein and in the Distribution Agreement, dated __________, 199_ (the
"Distribution Agreement"), between the Company, on the one hand, and
_____________________________________________________(the "Agents") on the
other, to issue and sell to _________________________ the securities specified
in the Schedule hereto (the "Purchased Securities"). Each of the provisions of
the Distribution Agreement not specifically related to the solicitation by the
Agents, as agents of the Company, of offers to purchase Securities is
incorporated herein by reference in its entirety, and shall be deemed to be part
of this Agreement to the same extent as if such provisions had been set forth in
full herein. Nothing contained herein or in the Distribution Agreement shall
make any party hereto an agent of the Company or make such party subject to the
provisions therein relating to the solicitation of offers to purchase securities
from the Company, solely by virtue of its execution of this Agreement. Each of
the representations and warranties set forth in the Distribution Agreement shall
be deemed to have been made at and as of the date of this Agreement, except that
each representation and warranty in Section 1 of the Distribution Agreement
which makes reference to the Prospectus shall be deemed to be a representation
and warranty as of the date of the Distribution Agreement in relation to the
Prospectus (as therein defined), and also a representation and warranty as of
the date of this Agreement in relation to the Prospectus as amended and
supplemented to relate to the Purchased Securities.
An amendment to the Registration Statement, or a supplement to the
Prospectus, as the case may be, relating to the Purchased Securities, in the
form heretofore delivered to you is now proposed to be filed with the
Commission.
<PAGE> 20
-20-
Subject to the terms and conditions set forth herein and in the
Distribution Agreement incorporated herein by reference, the Company agrees to
issue and sell to ____________________________ and
______________________________________ agrees to purchase from the Company the
Purchased Securities, at the time and place, in the principal amount and at the
purchase price set forth in the Schedule hereto.
If the foregoing is in accordance with your understanding, please sign
and return to us two counterparts hereof, and upon acceptance hereof by you this
letter and such acceptance hereof, including those provisions of the
Distribution Agreement incorporated herein by reference, shall constitute a
binding agreement between you and the Company.
CONECTIV
By:
-------------------------------------
Title:
----------------------------------
Accepted in New York, New York,
as of the date hereof:
[PURCHASING AGENT]
By:
-----------------------------------
Title:
--------------------------------
<PAGE> 21
-21-
SCHEDULE TO ANNEX I
Title of Purchased Securities:
Aggregate Principal Amount:
Price to Public:
Purchase Price:
Method of and Specified Funds for Payment of Purchase Price:
[By certified or official bank check or checks, payable to the order of
the Company, in immediately available funds]
[By wire transfer to a bank account specified by the Company in
immediately available funds]
Time of Delivery:
Closing Location:
Maturity:
Interest Rate:
Interest Payment Dates:
Initial Interest Payment Date:
Redemption Provisions:
Repayment Provisions:
Documents to be Delivered:
The following documents referred to in the Distribution Agreement shall
be delivered as a condition to the Closing:
[(1) The opinion or opinions of counsel to the Agents referred to in
Section 6(b).]
<PAGE> 22
-22-
[(2) The opinion of counsel to the Company referred to in Section 6(c).]
[(3) The accountants' letter referred to in Section 6(d).]
[(4) The officers' certificate referred to in Section 6(f).]
Other Provisions (including Syndicate Provisions, if applicable):
<PAGE> 23
-23-
ANNEX II
CONECTIV
ADMINISTRATIVE PROCEDURE
This Administrative Procedure relates to the Securities defined in the
Distribution Agreement, dated [insert date] (the "Distribution Agreement"),
between Conectiv (the "Company") and [insert names of agents] (together, the
"Agents"), to which this Administrative Procedure is attached as Annex II.
Defined terms used herein and not defined herein shall have the meanings given
such terms in the Distribution Agreement, the Prospectus as amended or
supplemented or the Indenture.
The procedures to be followed with respect to the settlement of sales of
Securities directly by the Company to purchasers solicited by an Agent, as
agent, are set forth below. Such procedures shall also be followed with respect
to sales of Securities by the Company to an Agent, as principal, unless the
Company and such Agent agree to follow different procedures pursuant to a
written Terms Agreement. An Agent, in relation to a purchase of a Security by a
purchaser solicited by such Agent, is referred to herein as the "Selling Agent"
and, in relation to a purchase of a Security by such Agent as principal as the
"Purchasing Agent".
The Company will advise each Agent in writing of those persons with whom
such Agent is to communicate regarding offers to purchase Securities and the
related settlement details.
Posting Rates by Company:
The Company and the Agents will discuss from time to time the rates of
interest per annum to be borne by and the maturity of Securities that may be
sold as a result of the solicitation of offers by an Agent. The Company may
establish a fixed set of interest rates and maturities for an offering period
("posting"). If the Company decides to change already posted rates, it will
promptly advise the Agents to suspend solicitation of offers until the new
posted rates have been established with the Agents.
Acceptance of Offers by Company:
Each Agent will promptly advise the Company by telephone or other
appropriate means of all reasonable offers to purchase Securities, other than
those rejected by such Agent. Each Agent may, in its discretion reasonably
exercised, reject any offer received by it in whole or in part. Each Agent also
may make offers to the Company to purchase Securities as a Purchasing Agent.
<PAGE> 24
-24-
The Company will have the sole right to accept offers to purchase Securities and
may reject any such offer in whole or in part.
The Company will promptly notify the Agent of its acceptance or rejection
of an offer to purchase Securities. If the Company accepts an offer to purchase
Securities, it will confirm such acceptance in writing to the Agent and the
Trustee.
Communication of Sale Information to Company by Agent:
After the acceptance of an offer by the Company, the Agent will
communicate the following details of the terms of such offer (the "Sale
Information") to the Company by telephone (confirmed in writing) or by facsimile
transmission or other acceptable written means:
(1) Principal amount of Securities to be purchased;
(2) If a Fixed Rate Security, the interest rate;
(3) Maturity Date;
(4) Issue Price;
(5) Selling Agent's commission or Purchasing Agent's discount, as the
case may be;
(6) Net proceeds to the Company;
(7) Settlement Date;
(8) If a redeemable Security, such of the following as are applicable:
(i) Redemption Commencement Date,
(ii) Initial Redemption Price (% of par), and
(iii) Amount (% of par) that the Redemption Price shall decline on
each anniversary of the Redemption Commencement Date;
[(9) If a Floating Rate Security, such of the following as are
applicable:
(i) Interest Rate Basis,
(ii) Index Maturity,
(iii) Spread or Spread Multiplier,
(iv) Maximum Rate,
(v) Minimum Rate,
(vi) Initial Interest Rate,
(vii) Interest Reset Dates,
(viii) Calculation Dates,
(ix) Interest Determination Dates,
(x) Interest Payment Dates,
(xi) Regular Record Dates, and
(xii) Calculation Agent;]
(10) Name, address and taxpayer identification number of the registered
owner;
(11) Denomination of certificates to be delivered at settlement;
<PAGE> 25
-25-
(12) Whether such Security is a Book-Entry Security or a Certificated
Security; and
(13) Whether such Agent is acting as Selling Agent or Purchasing Agent.
Preparation of Pricing Supplement by Company:
If the Company accepts an offer to purchase a Security, it will prepare a
Pricing Supplement. The Company will arrange to have ten Pricing Supplements
filed with the Commission not later than the close of business of the Commission
on the fifth business day following the date on which such Pricing Supplement is
first used, and will promptly deliver copies of such Pricing Supplement to the
Agent no later than 11:00 a.m. on the day following the Trade Date via next day
mail or telecopy at the following locations:
Delivery of Confirmation and Prospectus to Purchaser by Selling Agent:
The Selling Agent will deliver to the purchaser of a Security a written
confirmation of the sale and delivery and payment instructions. In addition, the
Selling Agent will deliver to such purchaser or its agent the Prospectus as
amended or supplemented (including the Pricing Supplement) in relation to such
Security prior to or together with the earlier of the delivery to such purchaser
or its agent of (a) the confirmation of sale or (b) the Security.
Date of Settlement:
All offers solicited by a Selling Agent or made by a Purchasing Agent and
accepted by the Company will be settled on a date (the "Settlement Date") which
is the third business day after the date of acceptance of such offer, unless the
Company and the purchaser agree to settlement (a) on any other business day
after the acceptance of such offer or (b) with respect to an offer accepted by
the Company prior to 10:00 a.m., New York City time, on the date of such
acceptance.
Instruction from Company to Trustee for Preparation of Securities,
Preparation and Delivery of Securities by Trustee and Receipt of Payment
Therefor:
After receiving the Sale Information from the Agent, the Company will
communicate such Sale Information to the Trustee by telephone (confirmed in
writing) or by facsimile transmission or other acceptable written means. The
Trustee will prepare each Security and appropriate receipts that will serve as
the documentary control of the transaction. Each Security will be represented by
either a Global Security (as defined below) delivered to the Trustee, as agent
for The Depository Trust Company ("DTC"), and recorded in the book-entry system
maintained by DTC (a "Book-Entry Security") or a certificate delivered to the
holder thereof or a person designated by such holder (a "Certificated
Security"). Except as set forth in the Prospectus, as
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amended or supplemented, an owner of a Book-Entry Security will not be entitled
to receive a Certificated Security.
A. PROCEDURES FOR BOOK-ENTRY SECURITIES
In connection with the qualification of Book-Entry Securities for
eligibility in the book-entry system maintained by DTC, the Trustee will perform
the custodial, document control and administrative functions described below, in
accordance with its respective obligations under a Letter of Representation from
the Company and the Trustee to DTC, dated as of[insert date] (the "Letter of
Representation"), and a Medium-Term Note Certificate Agreement between the
Trustee and DTC dated [insert date], and its obligations as a participant in
DTC, including DTC's Same-Day Funds Settlement System ("SDFS").
On any Settlement Date for one or more Book-Entry Securities, the Company
will issue a single global security in fully registered form without coupons (a
"Global Security") representing up to U.S. $250,000,000 principal amount of all
such Securities that have the same Original Issue Date, Maturity Date and other
terms. Each Global Security will be dated and issued as of the date of its
authentication by the Trustee. Each Global Security will bear an "Interest
Accrual Date," which will be (i) with respect to an original Global Security (or
any portion thereof), its original issuance date and (ii) with respect to any
Global Security (or any portion thereof) issued subsequently upon exchange of a
Global Security, or in lieu of a destroyed, lost or stolen Global Security, the
most recent Interest Payment Date to which interest has been paid or duly
provided for on the predecessor Global Security or Securities (or if no such
payment or provision has been made, the original issuance date of the
predecessor Global Security), regardless of the date of authentication of such
subsequently issued Global Security. Book-Entry Securities may be payable only
in U.S. dollars. No Global Security will represent any Certificated Security.
Upon receipt of the Sale Information from the Company, the Trustee will
then assign a CUSIP number to the Global Security representing such Security and
will notify the Company and the Agent of such CUSIP number by telephone as soon
as practicable.
The Trustee will enter a pending deposit message through DTC's
Participant Terminal System providing the following settlement information to
DTC, the Agent and Standard & Poor's Corporation:
1. The Sale Information.
2. The Initial Interest Payment Date for such Security, the number of days by
which such date succeeds the related DTC Record Date (which shall be the
Record Date as defined in the Security) and, if known, amount of interest
payable on such Initial Interest Payment Date.
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3. The CUSIP number of the Global Security representing such Security.
4. Whether such Global Security will represent any other Book-Entry Security (to
the extent known at such time).
By 9:00 a.m. on the Settlement Date, the Trustee will complete and
authenticate the Global Security representing such Security. By 10:00 a.m. on
the Settlement Date, DTC will credit such Security to the Trustee's participant
account at DTC.
By 2:00 p.m. on the Settlement Date, the Trustee will enter an SDFS
deliver order through DTC's Participant Terminal System instructing DTC to (i)
debit such Security to the Trustee's participant account and credit such
Security to the Agent's participant account and (ii) debit the Agent's
settlement account and credit the Trustee's settlement account for an amount
equal to the price of such Security less the Agent's commission, if any. The
entry of such a deliver order shall constitute a representation and warranty by
the Trustee to DTC that (a) the Global Security representing such Book-Entry
Security has been issued and authenticated and (b) the Trustee is holding such
Global Security pursuant to the Medium-Term Note Certificate Agreement between
the Trustee and DTC.
Unless the Agent is the end purchaser of such Security, the Agent will
enter an SDFS deliver order through DTC's Participant Terminal System
instructing DTC (i) to debit such Security to the Agent's participant account
and credit such Security to the participant accounts of the Participants with
respect to such Security and (ii) to debit the settlement accounts of such
Participants and credit the settlement account of the Agent for an amount equal
to the price of such Security.
By 4:45 p.m. on the Settlement Date transfers of funds in accordance with
SDFS deliver orders described in the two preceding paragraphs will be settled in
accordance with SDFS operating procedures in effect on the Settlement Date.
By 5:00 p.m. on the Settlement Date, the Trustee will credit to the
account of the Company maintained with the Trustee in funds available for
immediate use in the amount transferred to the Trustee by the Agent.
Unless the Agent is the end purchaser of such Security, the Agent will
confirm the purchase of such Security to the purchaser either by transmitting to
the Participants with respect to such Security a confirmation order or orders
through DTC's institutional delivery system or by mailing a written confirmation
to such purchaser.
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If settlement of a Book-Entry Security is rescheduled or canceled, the
Trustee, after receiving notice from the Company or the Agent, will deliver to
DTC, through DTC's Participant Terminal System, a cancellation message to such
effect by no later than 2:00 P.M. on the Business Day immediately preceding the
scheduled Settlement Date.
The Company will instruct the Trustee by facsimile transmission or other
acceptable written means to authenticate and deliver the Certificated Securities
no later than 2:15 p.m., New York City time, on the Settlement Date. Such
instruction will be given by the Company prior to 3:00 p.m., New York City time,
on the business day prior to the Settlement Date unless the Settlement Date is
the date of acceptance by the Company of the offer to purchase Securities in
which case such instruction will be given by the Company by 11:00 a.m., New York
City time.
B. PROCEDURES FOR CERTIFICATED SECURITIES
In the case of a sale of Certificated Securities to a purchaser solicited
by an Agent, the Trustee will, by 2:15 p.m., New York City time, on the
Settlement Date, deliver the Securities to the Selling Agent for the benefit of
the purchaser of such Securities against delivery by the Selling Agent of a
receipt therefor. On the Settlement Date, the Selling Agent will deliver payment
for such Securities in immediately available funds to the Trustee in an amount
equal to the issue price of the Securities less the Selling Agent's commission;
provided that the Selling Agent reserves the right to withhold payment for which
it has not received funds from the purchaser.
In the case of a sale of Securities to a Purchasing Agent, the Trustee
will, by 2:15 p.m., New York City time, on the Settlement Date, deliver the
Securities to the Purchasing Agent against delivery of payment for such
Securities in immediately available funds to the Trustee in an amount equal to
the issue price of the Securities less the Purchasing Agent's discount.
In either case, promptly upon receipt of such funds from the Agent, the
Trustee will wire an amount equal thereto to, or upon the order of, the Company
in immediately available funds.
The Trustee shall deliver Certificated Securities to:
Failure to Settle:
A. PROCEDURES FOR BOOK-ENTRY SECURITIES
If the Trustee fails to enter an SDFS deliver order with respect to a
Book-Entry Security, the Trustee may deliver to DTC, through DTC's Participant
Terminal System, as soon as practicable a withdrawal message instructing DTC to
debit such Security to the Trustee's participant account, provided that the
Trustee's participant account contains a principal amount of
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the Global Security representing such Security 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 Securities represented by a Global Security, the
Trustee will mark such Global Security "canceled," make appropriate entries in
the Trustee's records and send such canceled Global Security to the Company. The
CUSIP number assigned to such Global Security shall, in accordance with the
procedures of the CUSIP Service Bureau of Standard & Poor's Corporation, be
canceled and not immediately reassigned. If a withdrawal message is processed
with respect to one or more, but not all, of the Book-Entry Securities
represented by a Global Security, the Trustee will exchange such Global Security
for two Global Securities, one of which shall represent such Book-Entry Security
or Securities and shall be canceled immediately after issuance and the other of
which shall represent the remaining Book-Entry Securities previously represented
by the surrendered Global Security and shall bear the CUSIP number of the
surrendered Global Security.
If the purchase price for any Book-Entry Security is not timely paid to
the Participants with respect to such Security 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 may enter SDFS
deliver orders through DTC's Participant Terminal System reversing the orders
entered. Thereafter, the Trustee will deliver the withdrawal message and take
the related actions described in the preceding paragraph.
Notwithstanding the foregoing, upon any failure to settle with respect to
a Book-Entry Security, 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 Securities to have been represented by a Global Security,
the Trustee will provide for the authentication and issuance of a Global
Security representing the Book-Entry Securities to be represented by such Global
Security and will make appropriate entries in its records.
B. PROCEDURES FOR CERTIFICATED SECURITIES
If a purchaser fails to make payment to the Selling Agent for a
Certificated Security, the Selling Agent will promptly notify the Trustee and
the Company thereof by telephone (confirmed in writing) or by facsimile
transmission or other acceptable written means. The Selling Agent will
immediately return the Certificated Security to the Trustee. Immediately upon
receipt of such Security by the Trustee, the Trustee will debit the account of
the Company in an amount equal to the amount previously credited thereto in
respect of such Security and will return such funds to the Selling Agent. The
Company will reimburse the Selling Agent on an equitable basis for its loss of
the use of funds at the then prevailing broker-loan rate during the period when
they were credited to the account of the Company.
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The Trustee will cancel the Certificated Security in respect of which the
failure occurred, make appropriate entries in its records and, unless otherwise
instructed by the Company, destroy the Security.
