SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of report (Date earliest event reported) May 24, 1999
METROPOLITAN EDISON COMPANY
(Exact Name of Registrant as Specified in Charter)
PENNSYLVANIA 1-446 23-0870160
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(State or Other (Commission (IRS Employer
Jurisdiction of File Number) Identification No.)
Incorporation)
2800 Pottsville Pike, Reading, PA 19640-001
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (610) 929-3601
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Item 5. Other Events.
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Metropolitan Edison Company, (the "Registrant") is filing herewith the
following exhibits in connection with the offering by Met-Ed Capital Trust of
4,000,000 7.35% Trust Preferred Securities pursuant to the Registration
Statement of the Registrant, Met-Ed Capital Trust and Met-Ed Capital II, L.P. on
Form S-3, as amended (File Nos. 333-62967, 333-62967-01, 333-62967-02) filed
with the Securities and Exchange Commission under the Securities Act of 1933, as
amended. Reference is made to the Prospectus dated May 24, 1999, for further
information regarding the offering, including the use of proceeds.
Item 7. Financial Statements, Pro Forma Financial Information and
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Exhibits.
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(c) Exhibits:
1-A Underwriting Agreement, dated May 24, 1999, between
Metropolitan Edison Company, Met-Ed Capital II, L.P.,
Met-Ed Capital Trust and Morgan Stanley & Co. Incorporated,
A.G. Edwards & Sons, Inc., Bank One Capital Markets Inc.,
Legg Mason Wood Walker, Incorporated and Salamon Smith
Barney Inc. as representatives of the several underwriters,
including themselves, named in Schedule II thereto
providing for the issuance and sale of $100,000,000
aggregate liquidation amount of 7.35% Trust Preferred
Securities.
8 Opinion of Carter, Ledyard & Milburn
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SIGNATURES
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PURSUANT TO THE REQUIREMENTS OF THE SECURITIES EXCHANGE ACT OF 1934, THE
REGISTRANT HAS DULY CAUSED THIS REPORT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED HEREUNTO DULY AUTHORIZED.
Metropolitan Edison Company
By: /s/ T.G.Howson
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T.G.Howson
Vice President and Treasurer
Date: May 28, 1999
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EXHIBITS TO BE FILED BY EDGAR
Exhibits:
1-A Underwriting Agreement, dated May 24, 1999, between Metropolitan
Edison Company, Met-Ed Capital II, L.P., Met-Ed Capital Trust and
Morgan Stanley & Co. Incorporated, A.G. Edwards & Sons, Inc.,
Bank One Capital Markets Inc., Legg Mason Wood Walker,
Incorporated and Salamon Smith Barney Inc. as representatives of
the several underwriters, including themselves, named in Schedule
II thereto providing for the issuance and sale of $100,000,000
aggregate liquidation amount of 7.35% Trust Preferred Securities.
8 Opinion of Carter, Ledyard & Milburn
(..continued)
Exhibit 1-A
MET-ED CAPITAL TRUST
MET-ED CAPITAL II, L.P.
METROPOLITAN EDISON COMPANY
4,000,000 Trust Preferred Securities of
Met-Ed Capital Trust
7.35% Trust Preferred Securities
(Liquidation amount $25 per Trust Preferred Security)
each representing a
7.35% Cumulative Preferred Security of
Met-Ed Capital II, L.P.
(Liquidation amount $25 per Preferred Security)
fully and unconditionally guaranteed by
Metropolitan Edison Company
Underwriting Agreement
New York, New York
May 24, 1999
To the Representatives named
in Schedule I hereto of
the Underwriters named in
Schedule II hereto
Ladies and Gentlemen:
Metropolitan Edison Company, a Pennsylvania corporation (the
"Company"), and Met-Ed Capital II, L.P., a limited partnership formed under the
laws of the State of Delaware and a special purpose indirect subsidiary of the
Company (the "Partnership"), propose to cause Met-Ed Capital Trust, a statutory
business trust created under the laws of the State of Delaware (the "Trust"), to
issue and sell to the several underwriters named in Schedule II hereto (the
"Underwriters"), for whom you (the "Representatives") are acting as
representatives, the amount of its securities specified in Schedule I hereto
(the "Trust Securities"), pursuant to an Amended and Restated Trust Agreement of
Met-Ed Capital Trust, by and among the Partnership, as Grantor, and The Bank of
New York (Delaware), as Delaware Trustee, and The Bank of New York, as Property
Trustee, and T.G. Howson, S. H. Somich, and M.E. Gramlich, as Regular Trustees,
dated as of May 24, 1999 (the "Trust Agreement"). Each Trust Security represents
a cumulative preferred limited partner interest (collectively, the "Preferred
Securities") of the Partnership.
In connection with the issuance and sale of the Trust Securities,
(i) the Trust proposes to use the proceeds from the
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sale of the Trust Securities to purchase Preferred Securities from the
Partnership; (ii) the Partnership proposes to lend the proceeds from the sale of
the Preferred Securities to the Trust, together with other funds, to the
Company; (iii) the Company proposes to issue to the Partnership its Subordinated
Debentures (the "Subordinated Debentures") pursuant to an Indenture, dated as of
May 1, 1999, between the Company and United States Trust Company of New York, as
Trustee (the "Indenture"); and (iv) the Company proposes to guarantee certain
payments by the Partnership in respect of the Preferred Securities (the
"Guarantee"), pursuant to a Payment and Guarantee Agreement, dated as of May 28,
1999, executed and delivered by the Company (the "Guarantee Agreement"), all as
further described, and to the extent described, in the Prospectus.
The Trust Securities and the Preferred Securities, together with the
related Guarantee, and the Subordinated Debentures are collectively referred to
herein as the "Offered Securities". The Company, the Trust and the Partnership
are collectively referred to herein as the "Offerors".
To the extent there are no additional Underwriters listed on
Schedule II other than you, the term Representatives as used herein shall mean
you, as Underwriters, and the terms Representatives and Underwriters shall mean
either the singular or plural as the context requires. Any reference herein to
the Registration Statement, the Basic Prospectus, any Preliminary Final
Prospectus or the Final Prospectus shall be deemed to refer to and include the
documents incorporated by reference therein pursuant to Item 12 of Form S-3
which were filed under the Exchange Act on or before the Effective Date of the
Registration Statement or the issue date of the Basic Prospectus, any
Preliminary Final Prospectus or the Final Prospectus, as the case may be; and
any reference herein to the terms "amend", "amendment" or "supplement" with
respect to the Registration Statement, the Basic Prospectus, any Preliminary
Final Prospectus or the Final Prospectus shall be deemed to refer to and include
the filing of any document under the Exchange Act after the Effective Date of
the Registration Statement or the issue date of the Basic Prospectus, any
Preliminary Final Prospectus or the Final Prospectus, as the case may be, deemed
to be incorporated therein by reference. Certain terms used herein are defined
in Section 18 hereof.
1. Representations and Warranties. The Offerors jointly and
severally represent and warrant to, and agree with, each Underwriter as set
forth below in this Section 1.
(a) The Offerors meet the requirements for use of Form S-3 under the
Act and have prepared and filed with the Commission a registration
statement (the file numbers of which are set forth in Schedule I hereto)
on Form S-3, including a related basic prospectus, for registration under
the Act of the offering and sale of the Offered Securities. The Offerors
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may have filed one or more amendments thereto, including a Preliminary
Final Prospectus, each of which has previously been furnished to you. The
Offerors will next file with the Commission a Final Prospectus in
accordance with Rules 415 and 424(b). As filed, such Final Prospectus or
such amendment and form of Final Prospectus shall, except to the extent
the Representatives shall agree in writing to a modification, be in all
substantive respects in the form furnished to you prior to the Execution
Time or, to the extent not completed at the Execution Time, shall contain
only such specific additional information and other changes (beyond that
contained in the Basic Prospectus and any Preliminary Final Prospectus) as
the Offerors have advised you, prior to the Execution Time, will be
included or made therein. The Registration Statement, at the Execution
Time, meets the requirements set forth in Rule 415(a)(1)(x).
(b) The documents incorporated by reference in the Final Prospectus,
when they were filed with the Commission, complied in all material
respects with the requirements of the Exchange Act; and any further
documents so filed and incorporated by reference in the Final Prospectus
(together with any supplement thereto), when such documents are filed with
the Commission, will 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 circumstances
under which they were made, not misleading; provided, however, that the
Offerors make no representations or warranties as to the information
contained in or omitted from the Final Prospectus in reliance upon and in
conformity with information furnished in writing to the Offerors by or on
behalf of any Underwriter through the Representatives specifically for
inclusion in the Final Prospectus.
(c) On the Effective Date, the Registration Statement did or will,
and when the Final Prospectus is first filed (if required) in accordance
with Rule 424(b) and on the Closing Date (as defined herein), the Final
Prospectus (and any supplement thereto) will, comply in all material
respects with the applicable requirements of the Act, and the Trust
Indenture Act; on the Effective Date and at the Execution Time, the
Registration Statement did not or will not contain any untrue statement of
a material fact or omit to state any material fact required to be stated
therein or necessary in order to make the statements therein not
misleading; on the Effective Date and on the Closing Date each of the
Indenture and the Trust Agreement did or will comply in all material
respects with the applicable requirements of the Trust Indenture Act; and,
on the Effective Date, the Final Prospectus, if not filed pursuant to Rule
424(b), will not, and on the date of any filing pursuant to Rule 424(b)
and on
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the Closing Date, the Final Prospectus (together with any 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 the Offerors make no representations
or warranties as to (i) those parts of the Registration Statement which
shall constitute the Statements of Eligibility and Qualification (Forms
T-1) under the Trust Indenture Act of the Indenture Trustee or the
Property Trustee or (ii) the information contained in or omitted from the
Registration Statement or the Final Prospectus (or any supplement thereto)
in reliance upon and in conformity with information furnished in writing
to the Offerors by or on behalf of any Underwriter through the
Representatives specifically for inclusion in the Registration Statement
or the Final Prospectus (or any supplement thereto), but nothing contained
herein is intended as a waiver of compliance with the Act or any rule or
regulation of the Commission thereunder.
(d) The Company is duly incorporated and is validly subsisting and
in good standing under the laws of its jurisdiction of incorporation with
full corporate power and authority to own or lease, as the case may be,
and to operate its properties and conduct its business as described in the
Final Prospectus, and is duly qualified to do business as a foreign
corporation and is in good standing under the laws of each jurisdiction
which requires such qualification, or is subject to no material liability
or disability by reason of the failure to be so qualified in any such
jurisdiction.
(e) The Trust has been duly created and is validly existing in good
standing as a business trust under the Delaware Business Trust Act, is a
"grantor trust" for United States federal income tax purposes, has the
power and authority to own or lease, as the case may be, and to operate
its properties and conduct its business as described in the Final
Prospectus and is not required to be authorized to do business in any
other jurisdiction. The Trust has all requisite power and authority to
issue the Trust Securities and to purchase the Preferred Securities as
described in the Final Prospectus. The Trust has no subsidiaries.
(f) The Partnership has been duly formed and is validly existing and
in good standing under the laws of the State of Delaware with full
partnership power and authority to own or lease, as the case may be, and
to operate its properties and conduct its business as described in the
Final Prospectus, and is not required to be authorized to do business in
any other jurisdiction. The Partnership has all requisite power and
authority to issue the Preferred Securities to the Trust and to lend the
proceeds thereof to the Company as described in the Final Prospectus. The
Partnership has no subsidiaries.
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(g) The Trust Securities have been duly and validly authorized by
the Trust and will conform to the description thereof in the Final
Prospectus; and when the Trust Securities are executed and delivered to
the Underwriters and are paid for by the Underwriters in accordance with
the terms of this Agreement, the Trust Securities will be validly issued,
fully paid and non-assessable beneficial interests in the Trust, and not
subject to any preemptive rights.
(h) The Preferred Securities have been duly and validly authorized
by the Partnership and will conform to the description thereof in the
Final Prospectus; and when the Preferred Securities are executed and
delivered to the Trust and are paid for by the Trust in accordance with
the terms of this Agreement, the Preferred Securities will be validly
issued, fully paid and non-assessable, and not subject to any preemptive
rights.
(i) The Subordinated Debentures have been duly and validly
authorized by the Company and will conform to the description thereof in
the Final Prospectus; and when the Subordinated Debentures are issued and
delivered by the Company to the Partnership and paid for by the
Partnership in accordance with the terms of this Agreement, the
Subordinated Debentures will constitute legal, valid and binding
obligations of the Company entitled to the benefits of the Indenture
(subject, as to enforcement of remedies, to applicable bankruptcy,
reorganization, insolvency, fraudulent conveyance, moratorium or other
laws affecting creditors' rights generally from time to time in effect and
to general principles of equity, including, without limitation, concepts
of materiality, reasonableness, good faith and fair dealing, regardless of
whether considered in a proceeding in equity or at law).
(j) All of the issued general partner interests of the Partnership
have been duly and validly authorized and issued and are fully paid and
non-assessable and are owned by the Company or a wholly owned subsidiary
of the Company and free of preemptive rights.
(k) The Trust Agreement has been duly and validly authorized,
executed and delivered, has been duly qualified under the Trust Indenture
Act, and constitutes a legal, valid and binding instrument enforceable
against the Partnership in accordance with its terms (subject, as to
enforcement of remedies, to applicable bankruptcy, reorganization,
insolvency, fraudulent conveyance, moratorium or other laws affecting
creditors' rights generally from time to time in effect and to general
principles of equity, including, without limitation, concepts of
materiality, reasonableness, good faith and fair dealing, regardless of
whether considered in a proceeding in equity or at law).
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(l) The Indenture has been duly and validly authorized, executed and
delivered, has been duly qualified under the Trust Indenture Act, conforms
to the description thereof contained in the Final Prospectus, and
constitutes a legal, valid and binding instrument enforceable against the
Company in accordance with its terms (subject, as to enforcement of
remedies, to applicable bankruptcy, reorganization, insolvency, fraudulent
conveyance, moratorium or other laws affecting creditors' rights generally
from time to time in effect and to general principles of equity,
including, without limitation, concepts of materiality, reasonableness,
good faith and fair dealing, regardless of whether considered in a
proceeding in equity or at law).
(m) The Amended and Restated Limited Partnership Agreement of Met-Ed
Capital II, L.P., dated as of May 24, 1999 by and among Met-Ed Preferred
Capital II, Inc., as General Partner (the "General Partner"), T.G. Howson,
as Class A Limited Partner (the "Class A Limited Partner"), and the
persons who become limited partners in accordance with the provisions of
such agreement (the "Partnership Agreement") has been duly and validly
authorized, executed and delivered and constitutes a legal, valid and
binding instrument enforceable against the General Partner and the Class A
Limited Partner in accordance with its terms (subject, as to enforcement
of remedies, to applicable bankruptcy, reorganization, insolvency,
fraudulent conveyance, moratorium or other laws affecting creditors'
rights generally from time to time in effect and to general principles of
equity, including, without limitation, concepts of materiality,
reasonableness, good faith and fair dealing, regardless of whether
considered in a proceeding in equity or at law).
(n) The Guarantee Agreement, has been duly and validly authorized,
executed and delivered and constitutes a legal, valid and binding
instrument enforceable against the Company in accordance with its terms
(subject, as to enforcement of remedies, to applicable bankruptcy,
reorganization, insolvency, fraudulent conveyance, moratorium or other
laws affecting creditors' rights generally from time to time in effect and
to general principles of equity, including, without limitation, concepts
of materiality, reasonableness, good faith and fair dealing, regardless of
whether considered in a proceeding in equity or at law); and the Guarantee
will conform to the description thereof in the Final Prospectus;
(o) This Agreement has been duly and validly authorized, executed
and delivered by each of the Offerors and constitutes a valid and binding
obligation of each of the Offerors enforceable against each of the
Offerors in accordance with its terms (subject, as to enforcement of
remedies, to applicable bankruptcy, reorganization, insolvency, fraudulent
conveyance, moratorium or other laws
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affecting creditors' rights generally from time to time in effect and to
general principles of equity, including, without limitation, concepts of
materiality, reasonableness, good faith and fair dealing, regardless of
whether considered in a proceeding in equity or at law).
(p) None of the Offerors is and, after giving effect to the
offering, issuance or sale of the Offered Securities or the application of
the proceeds thereof as described in the Final Prospectus, none of the
Offerors will be an "investment company" as defined in the Investment
Company Act of 1940, as amended.
(q) No consent, approval, authorization, filing with or order of any
court or governmental agency or body is required in connection with the
transactions contemplated herein, except such as have been obtained under
the Act, the Trust Indenture Act, the Public Utility Holding Company Act
of 1935, as amended (the "1935 Act"), and the Pennsylvania Public Utility
Code, and such as may be required under the blue sky laws of any
jurisdiction in connection with the purchase and distribution of the
Offered Securities by the Underwriters in the manner contemplated herein
and in the Final Prospectus.
(r) Neither the execution and delivery of the Trust Agreement, the
Partnership Agreement, the Indenture or the Guarantee Agreement, nor the
issue or sale of any of the Offered Securities, nor the fulfillment of the
terms of this Agreement, the Guarantee Agreement, the Trust Agreement, the
Indenture or the Partnership Agreement nor the consummation of any other
of the transactions therein contemplated will conflict with, result in a
breach or violation or imposition of any lien, charge or encumbrance upon
any property or assets of any of the Offerors or any of their subsidiaries
pursuant to, (i) the charter or by-laws of the Company or the Trust
Agreement or Certificate of Trust of the Trust or the Partnership
Agreement or Certificate of Limited Partnership of the Partnership or any
other organizational documents of any of the Offerors or any of their
subsidiaries, (ii) the terms of any indenture, contract, lease, mortgage,
deed of trust, note agreement, loan agreement, trust agreement or other
agreement, obligation, condition, covenant or instrument to which any of
the Offerors or any of their subsidiaries is a party or bound or to which
any of their property is subject, or (iii) any statute, law, rule,
regulation, judgment, order or decree applicable to any of the Offerors or
any of their subsidiaries of any court, regulatory body, administrative
agency, governmental body, arbitrator or other authority having
jurisdiction over any of the Offerors or any of their subsidiaries or any
of their properties.
(s) The consolidated financial statements and schedules of the
Company and its consolidated subsidiaries included in
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the Final Prospectus and the Registration Statement present fairly in all
material respects the financial condition, results of operations and cash
flows of the Company as of the dates and for the periods indicated, comply
as to form with the applicable accounting requirements of the Act and have
been prepared in conformity with generally accepted accounting principles
applied on a consistent basis throughout the periods involved (except as
otherwise noted therein).
(t) Other than as set forth or incorporated by reference in the
Final Prospectus, no action, suit or proceeding by or before any court or
governmental agency, authority or body or any arbitrator involving any of
the Offerors or any of their subsidiaries or any of their property is
pending or, to the best knowledge of any of the Offerors, threatened that
(i) could reasonably be expected to have a material adverse effect on any
of the Offerors' performance of this Agreement or the consummation of any
of the transactions contemplated hereby or (ii) could reasonably be
expected to have a material adverse effect on the condition (financial or
otherwise), business prospects, earnings, business or properties of the
Trust, the Partnership or the Company and its subsidiaries, taken as a
whole, whether or not arising from transactions in the ordinary course of
business, except as set forth or incorporated by reference in or
contemplated in the Final Prospectus (exclusive of any supplement
thereto).
(u) Neither any Offeror nor any subsidiary of any Offeror is in
violation or default of (i) any provision of its charter, bylaws, or other
organizational documents, or (ii) the terms of any material indenture,
contract, lease, mortgage, deed of trust, note agreement, loan agreement,
trust agreement or other material agreement, obligation, condition,
covenant or instrument to which it is a party or bound or to which its
property is subject.
(v) Since the date of the most recent financial statements included
or incorporated by reference in the Final Prospectus (exclusive of any
supplement thereto), there has been no material adverse effect on the
condition (financial or otherwise), business prospects, earnings, business
or properties of the Trust, Partnership or the Company and its
subsidiaries, taken as a whole, whether or not arising from transactions
in the ordinary course of business, except as set forth in or contemplated
in the Final Prospectus (exclusive of any supplement thereto).
(w) PricewaterhouseCoopers LLP, who have certified certain financial
statements of the Company and its consolidated subsidiaries and delivered
their report with respect to the audited consolidated financial statements
and schedules included in the Final Prospectus, are independent public
accountants with respect to the Company within the
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meaning of the Act.
Any certificate signed by any officer of any of the Offerors and
delivered to the Representatives or counsel for the Underwriters in
connection with the offering of the Offered Securities shall be deemed a
representation and warranty by each of the Offerors, as to matters covered
thereby, to each Underwriter.
2. Purchase and Sale. Subject to the terms and conditions and in
reliance upon the representations and warranties herein set forth:
(a) The Trust agrees to sell, and the Company and the Partnership
agree to cause the Trust to sell, to each Underwriter, and each
Underwriter agrees, severally and not jointly, to purchase from the Trust,
at the purchase price set forth in Schedule I hereto the amount of the
Trust Securities set forth opposite such Underwriter's name in Schedule II
hereto.
(b) The Trust agrees to use the proceeds from the sale of its Trust
Securities to the Underwriters to purchase Preferred Securities from the
Partnership, as described in the Final Prospectus, concurrently with the
issue and sale of the Trust Securities to the Underwriters.
(c) The Partnership agrees to execute, sell and deliver the
Preferred Securities to the Trust concurrently with the issue and sale of
the Trust Securities to the Underwriters and to lend the proceeds of such
sale, together with other funds, to the Company, as described in the Final
Prospectus, concurrently with the issue and sale of the Trust Securities
to the Underwriters.
(d) The Company agrees to issue and deliver to the Partnership the
Subordinated Debentures evidencing the loan referred to in 2(c) above and
to execute and deliver to the Partnership the Guarantee Agreement, in each
case, concurrently with the issue and sale of the Trust Securities.
3. Delivery and Payment; Underwriters' Compensation.
(a) Delivery of and payment for the Trust Securities shall be made
on the date and at the time specified in Schedule I hereto or at such time
on such later date not more than five Business Days after the foregoing
date as the Representatives shall designate, which date and time may be
postponed by agreement between the Representatives and the Trust or as
provided in Section 9 hereof (such date and time of delivery and payment
for the Trust Securities being herein called the "Closing Date"). Delivery
of the Trust Securities shall be made to the Representatives for the
respective
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accounts of the several Underwriters against payment by the several
Underwriters through the Representatives of the purchase price therefor to
or upon the order of the Trust by wire transfer payable in same-day funds
to an account specified by the Trust. Delivery of the Trust Securities
shall be made through the facilities of The Depository Trust Company
unless the Representatives shall otherwise instruct.
(b) As compensation to the Underwriters for their commitments
hereunder, the Company agrees to pay, at the Closing Date, to Morgan
Stanley & Co. Incorporated for the accounts of the several Underwriters,
an amount equal to $.7875 per Trust Security, except that for sales of
10,000 or more Trust Securities to a single purchaser, the underwriting
commission will be $.50 per Trust Security.
4. Offering by Underwriters. It is understood that the several
Underwriters propose to offer the Trust Securities for sale to the public as set
forth in the Final Prospectus.
5. Agreements. The Offerors, jointly and severally, agree with the
several Underwriters that:
(a) The Offerors will use their best efforts to cause the
Registration Statement, if not effective at the Execution Time, and any
amendment thereof, to become effective. Prior to the termination of the
offering of the Offered Securities, none of the Offerors will file any
amendment of the Registration Statement or supplement (including the Final
Prospectus or any Preliminary Final Prospectus) to the Basic Prospectus or
any Rule 462(b) Registration Statement unless the Offerors have furnished
you a copy for your review prior to filing and will not file any such
proposed amendment or supplement to which you reasonably object. Subject
to the foregoing sentence, if filing of the Final Prospectus is otherwise
required under Rule 424(b), the Offerors will cause the Final Prospectus,
properly completed, and any supplement thereto to be filed with the
Commission pursuant to the applicable paragraph of Rule 424(b) within the
time period prescribed and will provide evidence satisfactory to the
Representatives of such timely filing. The Offerors will promptly advise
the Representatives (1) when the Registration Statement, if not effective
at the Execution Time, shall have become effective, (2) when the Final
Prospectus, and any supplement thereto, shall have been filed (if
required) with the Commission pursuant to Rule 424(b) or when any Rule
462(b) Registration Statement shall have been filed with the Commission,
(3) when, prior to termination of the offering of the Offered Securities,
any amendment to the Registration Statement shall have been filed or
become effective, (4) of any request by the Commission or its staff for
any amendment of the Registration Statement, or any Rule 462(b)
Registration Statement, or for any supplement to the
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Final Prospectus or for any additional information, (5) of the issuance by
the Commission of any stop order suspending the effectiveness of the
Registration Statement or the institution or threatening of any proceeding
for that purpose and (6) of the receipt by any Offeror of any notification
with respect to the suspension of the qualification of the Offered
Securities for sale in any jurisdiction or the institution or threatening
of any proceeding for such purpose. The Offerors will use their best
efforts to prevent the issuance of any such stop order or the suspension
of any such qualification and, if issued, to obtain as soon as possible
the withdrawal thereof.
(b) If, at any time when a prospectus relating to the Offered
Securities is required to be delivered under the Act, any event occurs as
a result of which the Final Prospectus as then supplemented would include
any untrue statement of a material fact or omit to state any material fact
necessary to make the statements therein in the light of the circumstances
under which they were made not misleading, or if it shall be necessary to
amend the Registration Statement or supplement the Final Prospectus to
comply with the Act or the Exchange Act, the Offerors promptly will (1)
notify the Representatives of such event, (2) prepare and file with the
Commission, subject to the second sentence of paragraph (a) of this
Section 5, an amendment or supplement which will correct such statement or
omission or effect such compliance and (3) supply any supplemented Final
Prospectus to you in such quantities as you may reasonably request.
(c) As soon as practicable, the Company will make generally
available to its security holders and to the Representatives an earning
statement or statements of the Company and its subsidiaries which will
satisfy the provisions of Section 11(a) of the Act and Rule 158 under the
Act.
(d) The Offerors will furnish to the Representatives and
counsel for the Underwriters, without charge, signed copies of the
Registration Statement (including exhibits thereto) and to each other
Underwriter a copy of the Registration Statement (without exhibits
thereto) and, so long as delivery of a prospectus by an Underwriter or
dealer may be required by the Act, as many copies of each Preliminary
Final Prospectus and the Final Prospectus and any supplement thereto as
the Representatives may reasonably request.
(e) The Offerors will arrange, if and to the extent necessary, for
the qualification of the Offered Securities for sale under the laws of
such jurisdictions as the Representatives may designate, will maintain
such qualifications in effect so long as required for the distribution of
the Offered Securities and will pay any fee of the National Association of
Securities Dealers, Inc., in connection with its review of the offering,
if any; provided
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that in no event shall the Offerors be obligated to qualify to do business
in any jurisdiction where it is not now so qualified or to take any action
that would subject it to service of process in suits, other than those
arising out of the offering or sale of the Offered Securities, in any
jurisdiction where it is not now so subject.
(f) The Offerors will not, without the prior written consent
of Morgan Stanley & Co. Incorporated, offer, sell, contract to sell,
pledge, or otherwise dispose of (or enter into any transaction which is
designed to, or might reasonably be expected to, result in the disposition
(whether by actual disposition or effective economic disposition due to
cash settlement or otherwise) by any Offeror or any person in privity with
any Offeror), directly or indirectly, including the filing (or
participation in the filing) of a registration statement with the
Commission in respect of, or establish or increase a put equivalent
position or liquidate or decrease a call equivalent position within the
meaning of Section 16 of the Exchange Act, any Trust Securities, Preferred
Securities or Subordinated Debentures, any security convertible into or
exchangeable into or exercisable for Trust Securities, Preferred
Securities or Subordinated Debentures or any debt securities substantially
similar to the Subordinated Debentures or equity securities substantially
similar to the Trust Securities or Preferred Securities (other than (i)
the Offered Securities, (ii) commercial paper obligations and (iii)
ordinary short-term bank debt) or publicly announce an intention to effect
any such transaction, until the Business Day set forth on Schedule I
hereto.
(g) No Offeror will take, directly or indirectly, any action
designed to or which has constituted or which might reasonably be expected
to cause or result, under the Exchange Act or otherwise, in stabilization
or manipulation of the price of any security of any Offeror to facilitate
the sale or resale of the Offered Securities.
(h) The Offerors will, at their sole cost and expense, use
their best efforts to list, subject to notice of issuance, the Trust
Securities on the New York Stock Exchange, subject to the Underwriters
making the required distribution of the Trust Securities; and the Offerors
will, if the Subordinated Debentures are distributed, as set forth in the
Final Prospectus, at their sole cost and expense, use their best efforts
to list, subject to notice of issuance, the Subordinated Debentures on the
New York Stock Exchange.
(i) The Offerors will pay all expenses incident to the
performance of their obligations under this Agreement, including: (i) the
preparation and filing of the Registration Statement, the Basic
Prospectus, any Preliminary Final Prospectus or the Final Prospectus (or
any amendments or
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supplements thereto); (ii) the preparation, issuance and delivery of the
Offered Securities; (iii) the fees and disbursements of the Offerors'
counsel and accountants and of all trustees under the Indenture and the
Guarantee Agreement, and their counsel; (iv) the qualification of the
Offered Securities under state securities or Blue Sky laws, including
filing fees and the fees and disbursements of counsel for the Underwriters
in connection therewith and in connection with the preparation of any Blue
Sky or Legal investment memoranda (such amount not to exceed $7,500); (v)
the printing or other production of all documents relating to the
offering, including the printing and delivery to the Underwriters, in
quantities reasonably requested by the Underwriters, of copies of the
Registration Statement, the Basic Prospectus, any Preliminary Final
Prospectus and the Final Prospectus (and any amendments or supplements
thereto); (vi) the printing and delivery to the Underwriters of copies of
any Blue Sky or Legal Investment Memoranda; (vii) any fees charged by
rating agencies for the rating of the Offered Securities; and (viii) the
filing fees and expenses incurred in connection with the listing of the
Trust Securities on the New York Stock Exchange. Except as otherwise set
forth herein, the Underwriters will pay the fees and disbursements of the
Underwriters' counsel.
6. Conditions to the Obligations of the Underwriters. The
obligations of the Underwriters to purchase the Trust Securities shall be
subject to the accuracy of the representations and warranties on the part of the
Offerors contained herein as of the Execution Time and the Closing Date, to the
accuracy of the statements of the Offerors made in any certificates delivered
pursuant to the provisions hereof, to the performance by the Offerors of their
obligations hereunder and to the following additional conditions:
(a) If the Registration Statement has not become effective prior to
the Execution Time, unless the Representatives agree in writing to a later
time, the Registration Statement will become effective not later than (i)
6:00 PM New York City time, on the date of determination of the public
offering price, if such determination occurred at or prior to 3:00 PM New
York City time on such date or (ii) 9:30 AM on the Business Day following
the day on which the public offering price was determined, if such
determination occurred after 3:00 PM New York City time on such date; if
filing of the Final Prospectus, or any supplement thereto, is required
pursuant to Rule 424(b), the Final Prospectus, and any such supplement,
will be filed in the manner and within the time period required by Rule
424(b); and no stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceedings for that purpose shall
have been instituted or threatened.
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<PAGE>
(b) The Offerors shall have requested and caused Berlack, Israels &
Liberman LLP, counsel for the Offerors and Ryan, Russell, Ogden & Seltzer
LLP, Pennsylvania counsel for the Offerors, to have furnished to the
Representatives their opinions, dated the Closing Date and addressed to
the Representatives, to the effect that:
(i) The Company is duly incorporated and is validly subsisting
and in good standing under the laws of its jurisdiction of
incorporation with full corporate power and authority to own
or lease, as the case may be, and to operate its properties
and conduct its business as described in the Final Prospectus,
and is duly qualified to do business as a foreign corporation
and is in good standing under the laws of each jurisdiction
which requires such qualification, or is subject to no
material liability or disability by reason of the failure to
be so qualified in any such jurisdiction;
(ii) The Trust is not required to be authorized to do business
in any jurisdiction other than the State of Delaware;
(iii) The Partnership is not required to be authorized to do
business in any jurisdiction other than the State of Delaware;
and the Partnership is not a party to or bound by any
agreement other than those described in the Final Prospectus;
(iv) The Trust Securities conform to the description thereof
in the Final Prospectus;
(v) The Preferred Securities conform to the description
thereof in the Final Prospectus;
(vi) The Subordinated Debentures have been duly and validly
authorized by the Company and the Subordinated Debentures
conform to the description thereof in the Final Prospectus;
and when the Subordinated Debentures are issued and delivered
by the Company to the Partnership and are paid for by the
Partnership in accordance with the terms of this Agreement the
Subordinated Debentures will constitute legal, valid and
binding obligations of the Company entitled to the benefits of
the Indenture (subject, as to enforcement of remedies, to
applicable bankruptcy, reorganization, insolvency, fraudulent
conveyance, moratorium or other laws affecting creditors'
rights generally from time to time in effect and to general
principles of equity, including, without limitation, concepts
of materiality,
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reasonableness, good faith and fair dealing, regardless of
whether considered in a proceeding in equity or at law);
(vii) All of the issued general partner interests of the
Partnership are owned by the Company or a wholly owned
subsidiary of the Company;
(viii) The Trust Agreement has been duly and validly executed
and delivered and has been duly qualified under the Trust
Indenture Act;
(ix) The Indenture has been duly and validly authorized,
executed and delivered, has been duly qualified under the
Trust Indenture Act, conforms to the description thereof
contained in the Final Prospectus, and constitutes a legal,
valid and binding instrument enforceable against the Company
in accordance with its terms (subject, as to enforcement of
remedies, to applicable bankruptcy, reorganization,
insolvency, fraudulent conveyance, moratorium or other laws
affecting creditors' rights generally from time to time in
effect and to general principles of equity, including, without
limitation, concepts of materiality, reasonableness, good
faith and fair dealing, regardless of whether considered in a
proceeding in equity or at law);
(x) The Partnership Agreement has been duly and validly
executed and delivered;
(xi) The Guarantee Agreement, has been duly and validly
authorized, executed and delivered and constitutes a legal,
valid and binding instrument enforceable against the Company
in accordance with its terms (subject, as to enforcement of
remedies, to applicable bankruptcy, reorganization,
insolvency, fraudulent conveyance, moratorium or other laws
affecting creditors' rights generally from time to time in
effect and to general principles of equity, including, without
limitation, concepts of materiality, reasonableness, good
faith and fair dealing, regardless of whether considered in a
proceeding in equity or at law); and the Guarantee conforms to
the description thereof in the Final Prospectus;
(xii) This Agreement has been duly and validly authorized,
executed and delivered by each of the Offerors and constitutes
a valid and binding obligation of each of the Offerors
enforceable against each of the Offerors in accordance with
its
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<PAGE>
terms (subject, as to enforcement of remedies, to applicable
bankruptcy, reorganization, insolvency, fraudulent conveyance,
moratorium or other laws affecting creditors' rights generally
from time to time in effect and to general principles of
equity, including, without limitation, concepts of
materiality, reasonableness, good faith and fair dealing,
regardless of whether considered in a proceeding in equity or
at law);
(xiii) None of the Offerors is and, after giving effect to the
offering, issuance or sale of the Offered Securities or the
application of the proceeds thereof as described in the Final
Prospectus, none of the Offerors will be an "investment
company" as defined in the Investment Company Act of 1940, as
amended;
(xiv) To the knowledge of such counsel, there is no pending or
threatened action, suit or proceeding by or before any court
or governmental agency, authority or body or any arbitrator
involving any Offeror or any of their subsidiaries or any of
their property, of a character required to be disclosed in the
Registration Statement which is not adequately disclosed in
the Final Prospectus, and there is no franchise, contract or
other document of a character required to be described in the
Registration Statement or Final Prospectus, or to be filed as
an exhibit thereto, which is not described or filed as
required;
(xv) The documents incorporated by reference in the Final
Prospectus or any amendment or supplement thereto (other than
the financial statements and other financial or statistical
data contained therein, as to which such counsel need express
no opinion), when they became effective or were filed with the
Commission, as the case may be, complied as to form in all
material respects with the requirements of the Exchange Act;
(xvi) The Registration Statement has become effective under
the Act; to the knowledge of such counsel, no stop order
suspending the effectiveness of the Registration Statement has
been issued, no proceedings for that purpose have been
instituted or threatened, and the Registration Statement and
the Final Prospectus (other than the financial statements and
other financial or statistical information contained therein,
as to which such counsel need express no opinion) comply as to
form in all material respects with the applicable
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<PAGE>
requirements of the Act and the Trust Indenture Act; and that
such counsel does not know of any amendment to the
Registration Statement required to be filed or any contracts
or other documents of a character required to be filed as an
exhibit to the Registration Statement or required to be
incorporated by reference into the Final Prospectus or
required to be described in the Registration Statement or the
Final Prospectus which are not filed or incorporated by
reference or described as required;
(xvii) No consent, approval, authorization, filing with or
order of any court or governmental agency or body is required
in connection with the transactions contemplated herein,
except such as have been obtained under the Act, the 1935 Act,
the Pennsylvania Public Utility Code and the Trust Indenture
Act and such as may be required under the blue sky laws of any
jurisdiction in connection with the purchase and distribution
of the Offered Securities by the Underwriters in the manner
contemplated in this Agreement and in the Final Prospectus and
such other approvals (specified in such opinion) as have been
obtained;
(xviii) Neither the execution and delivery of the Trust
Agreement, the Partnership Agreement, the Indenture or the
Guarantee Agreement, nor the issue or sale of any of the
Offered Securities, nor the fulfillment of the terms of this
Agreement, the Guarantee Agreement, the Trust Agreement, the
Indenture or the Partnership Agreement nor the consummation of
any other of the transactions therein contemplated will
conflict with, result in a breach or violation or imposition
of any lien, charge or encumbrance upon any property or assets
of any of the Offerors (i) pursuant to the charter or by-laws
of the Company or the Trust Agreement or Certificate of Trust
of the Trust or the Partnership Agreement or Certificate of
Limited Partnership of the Partnership or any other
organizational documents of any of the Offerors, (ii) to the
best of such counsel's knowledge, pursuant to the terms of any
indenture, contract, lease, mortgage, deed of trust, note
agreement, loan agreement, trust agreement or other agreement,
obligation, condition, covenant or instrument to which any of
the Offerors or any of their subsidiaries is a party or bound
or to which any of their property is subject, or (iii)
pursuant to any statute, law, rule, regulation, judgment,
order or decree applicable to any of the Offerors of any
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<PAGE>
court, regulatory body, administrative agency, governmental
body, arbitrator or other authority having jurisdiction over
any of the Offerors or any of their properties.
In addition, each such counsel shall state that although they do not
assume any responsibility for the accuracy, completeness or fairness of
the statements contained in the Registration Statement or the Final
Prospectus, except for those covered by their opinions in subsections
(iv), (v), (vi), (ix) and (xi) of this section 6(b), such counsel has no
reason to believe that on the Effective Date the Registration Statement
contained any untrue statement of a material fact or omitted to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading or that the Final Prospectus as of its
date and on the Closing Date included or includes any untrue statement of
a material fact or omitted or omits to state a material fact necessary to
make the statements therein, in the light of the circumstances under which
they were made, not misleading (in each case, other than the financial
statements and other financial or statistical information contained
therein, as to which such counsel need express no view).
In rendering such opinion, (A) Berlack, Israels & Liberman LLP may
rely upon the opinion of Ryan, Russell, Ogden & Seltzer LLP as to matters
involving the laws of the Commonwealth of Pennsylvania, (B) Berlack,
Israels & Liberman LLP and Ryan, Russell, Ogden & Seltzer LLP may rely on
the opinion of Richards, Layton & Finger, P.A., special Delaware counsel
to the Offerors, delivered pursuant to paragraph (c) hereof, as to matters
involving the laws of the State of Delaware and (C) as to matters of fact,
to the extent they deem proper, such counsel may rely on certificates of
responsible officers of the Offerors and public officials. References to
the Final Prospectus in this paragraph (b) include any supplements thereto
at the Closing Date.
(c) The Offerors shall have requested and caused Richards, Layton &
Finger, P.A., special counsel to the Offerors, to have furnished to the
Representatives their opinion, dated the Closing Date and addressed to the
Representatives, to the effect that:
(i) The Trust has been duly created and is validly existing in
good standing as a business trust under the Delaware Business
Trust Act. Under the Trust Agreement and the Delaware Business
Trust Act, the Trust has all requisite trust power and
authority to own and to operate its properties and conduct its
business as described in the Final Prospectus. Under the Trust
Agreement and the Delaware Business Trust Act, the Trust has
all requisite
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<PAGE>
trust power and authority to issue the Trust Securities and to
purchase the Preferred Securities as described in the Final
Prospectus and to execute and deliver, and to perform its
obligations under, this Agreement.
(ii) The Partnership has been duly formed and is validly
existing and in good standing under the Delaware Revised
Uniform Limited Partnership Act (the "Partnership Act"). Under
the Partnership Agreement and the Partnership Act, the
Partnership has full partnership power and authority to own
and to operate its properties and conduct its business as
described in the Final Prospectus. Under the Partnership
Agreement and the Partnership Act, the Partnership has all
requisite partnership power and authority to issue the
Preferred Securities to the Trust and to lend the proceeds
thereof to the Company as described in the Final Prospectus.
(iii) The Trust Securities have been duly and validly
authorized by the Trust; and when the Trust Securities are
executed, authenticated and delivered and are paid for in
accordance with the terms of this Agreement and the Trust
Agreement, and as described in the Final Prospectus, the Trust
Securities will be duly and validly issued and, subject to the
qualifications set forth below in this paragraph (iii), fully
paid and nonassessable undivided beneficial interests in the
assets of the Trust. The Trust Security holders will be
entitled to the same limitation of personal liability extended
to stockholders of private corporations for profit organized
under the General Corporation Law of the State of Delaware.
Such counsel may note that the Trust Security holders may be
obligated, pursuant to the Trust Agreement, (i) to provide
indemnity and/or security in connection with and pay taxes or
governmental charges arising from transfers or exchanges of
Trust Security certificates and the issuance of replacement
Trust Security certificates, and (ii) to provide indemnity
and/or security in connection with requests of or directions
to the Property Trustee to exercise its rights and powers
under the Trust Agreement. Under the Trust Agreement and the
Delaware Business Trust Act, the issuance of the Trust
Securities is not subject to preemptive or similar rights.
(iv) The Preferred Securities have been duly and validly
authorized by the Partnership; and when the Preferred
Securities are executed and delivered to
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<PAGE>
the Trust and are paid for by the Trust in accordance with the
terms of this Agreement, the Preferred Securities will be duly
and validly issued and, subject to the qualifications set
forth in this paragraph below, fully paid and nonassessable
limited partner interests in the Partnership. Under the
Partnership Agreement and the Partnership Act, the issuance of
the Preferred Securities is not subject to preemptive or
similar rights. Assuming that the Trust does not participate
in the control of the business of the Partnership, the Trust,
as a limited partner of the Partnership, will have no
liability in excess of its obligations to make payments
provided for in the Partnership Agreement and its share of the
Partnership's assets and undistributed profits (subject to the
obligation of the Trust to repay any funds wrongfully
distributed to it). There are no provisions in the Partnership
Agreement the inclusion of which, subject to the terms and
conditions therein, or, assuming that the Trust, as a limited
partner of the Partnership, takes no action other than actions
permitted by the Partnership Agreement, the exercise of which,
in accordance with the terms and conditions therein, would
cause the Trust, as a limited partner of the Partnership, to
be deemed to be participating in the control of the business
of the Partnership.
(v) The general partner interests in the Partnership issued to
the General Partner have been duly and validly authorized.
When the general partner interests are issued to and paid for
by the General Partner in accordance with the Partnership
Agreement, such interests will be validly issued general
partner interests in the Partnership. Under the Partnership
Agreement, the Partnership Act, and the Delaware General
Corporation Law ("DGCL") the issuance of the general partner
interests in the Partnership issued to the General Partner are
not subject to preemptive or similar rights.
(vi) Under the Partnership Agreement, the Partnership Act and
the DGCL, the Trust Agreement has been duly and validly
authorized by all necessary partnership action on the part of
the Partnership and by all necessary corporate action on the
part of the General Partner. The Trust Agreement constitutes a
valid and binding obligation of the Partnership, and is
enforceable against the Partnership and the General Partner,
in accordance with its terms. The foregoing opinion
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<PAGE>
is subject, as to enforcement, to the effect upon the Trust
Agreement of (i) applicable bankruptcy, insolvency,
moratorium, receivership, reorganization, liquidation,
fraudulent conveyance or transfer and other similar laws
relating to or affecting the rights and remedies of creditors
generally, (ii) principles of equity, including applicable law
relating to fiduciary duties (regardless of whether considered
and applied in a proceeding in equity or at law), and (iii)
the effect of applicable public policy on the enforceability
of provisions relating to indemnification or contribution.
(vii) Under the relevant organizational documents of the
General Partner and the DGCL, the Partnership Agreement has
been duly and validly authorized by all necessary corporate
action on the part of the General Partner. The Partnership
Agreement constitutes a valid and binding obligation of the
General Partner, and is enforceable against the General
Partner in accordance with its terms. The foregoing opinion is
subject, as to enforcement, to the effect upon the Partnership
Agreement of (i) applicable bankruptcy, insolvency,
moratorium, receivership, reorganization, liquidation,
fraudulent conveyance or transfer and other similar laws
relating to or affecting the rights and remedies of creditors
generally, (ii) principles of equity, including applicable law
relating to fiduciary duties (regardless of whether considered
and applied in a proceeding in equity or at law), and (iii)
the effect of applicable public policy on the enforceability
of provisions relating to indemnification or contribution.
(viii) Under the Partnership Agreement and the Partnership
Act, the execution, delivery and performance of this Agreement
by the Partnership have been duly authorized by all necessary
partnership action on the part of the Partnership. Under the
Trust Agreement and the Delaware Business Trust Act, the
execution, delivery and performance of this Agreement by the
Trust have been duly authorized by all necessary trust action
on the part of the Trust.
(ix) No consent, approval, authorization, filing with or order
of any Delaware court or Delaware governmental agency or body
is required in connection with the Trust's or the
Partnership's execution, delivery or performance of this
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<PAGE>
Agreement.
(x) Such counsel has reviewed the statements in the Final
Prospectus (including any supplements thereto) under the
captions "Description of the Trust Securities", "Description
of the Preferred Securities", "Met-Ed Capital Trust", and
"Met-Ed Capital II, L.P." and, insofar as they contain
statements of Delaware law, such statements are fairly
presented.
(xi) Neither the execution and delivery of the Trust Agreement
by the Partnership nor the execution and delivery of the
Partnership Agreement by the General Partner, nor the issue or
sale of any of the Trust Securities or the Preferred
Securities, nor the consummation of any other of the
transactions herein contemplated nor the fulfillment of the
terms hereof will result in a breach or violation of (i) the
organizational documents of either the Trust or the
Partnership, (ii) any Delaware statute, law, rule or
regulation, or, (iii) after due inquiry on the day immediately
preceding the date of the legal opinion, limited to and solely
to the extent disclosed thereupon, the court dockets for
active cases in the Court or Chancery of the State of Delaware
in and for New Castle County, Delaware, the Superior Court of
the State of Delaware in and for New Castle County Delaware,
and the United States District Court sitting in the State of
Delaware, any judgment, order or decree applicable to the
Trust or the Partnership of any Delaware court, regulatory
body, administrative agency, governmental body, arbitrator or
other authority having jurisdiction over the Trust or the
Partnership.
(xii) Assuming that the Partnership is treated as a
partnership for Federal income tax purposes, and assuming that
the Partnership derives no income from or connected with
sources within the State of Delaware and has no employees in
the State of Delaware, the holders of Preferred Securities
(other than those holders of Preferred Securities who reside
or are domiciled in the State of Delaware), will have no
liability for income taxes imposed by the State of Delaware
solely as a result of their participation in the Partnership
and the Partnership will not be liable for any income tax
imposed by the State of Delaware.
(xiii) Assuming that the Trust is treated as a grantor trust
for United States federal income tax
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<PAGE>
purposes, and assuming that the Trust derives no income from
or connected with sources within the State of Delaware and has
no employees in the State of Delaware, the holders of the
Trust Securities (other than those holders of Trust Securities
who reside or are domiciled in the State of Delaware) will
have no liability for income taxes imposed by the State of
Delaware solely as a result of their participation in the
Trust, and the Trust will not be liable for any income tax
imposed by the State of Delaware.
(d) The Offerors shall have requested and caused Carter, Ledyard &
Milburn, special tax counsel to the Offerors, to have furnished to the
Representatives their opinion, dated the Closing Date and addressed to the
Representatives, to the effect that:
(i) Such counsel confirms its opinion as set forth under
"Certain Federal Income Tax Considerations" in the Final
Prospectus, including any supplements thereto at the
Closing Date;
(ii) The Trust is classified for United States federal income
tax purposes as a grantor trust and not as a business entity
taxable as a corporation;
(iii) The Partnership is classified for United States federal
income tax purposes as a partnership and not as a business
entity taxable as a corporation; and
(iv) The statements made in the Final Prospectus (together
with any supplements thereto) under the caption "ERISA
Considerations", insofar as such statements constitute
summaries of legal matters, documents or proceedings referred
to therein, fairly summarize the matters referred to therein
in all material respects.
(e) The Representatives shall have received from Thelen Reid &
Priest LLP, counsel for the Underwriters, such opinion or opinions, dated
the Closing Date and addressed to the Representatives, with respect to the
issuance and sale of the Offered Securities, the Trust Agreement, the
Partnership Agreement, the Indenture, the Guarantee Agreement, the
Registration Statement, the Final Prospectus (together with any supplement
thereto) and other related matters as the Representatives may reasonably
require, and the Offerors shall have furnished to such counsel such
documents as they request for the purpose of enabling them to pass upon
such matters.
(f) The Company shall have furnished to the
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Representatives a certificate of the Company, signed by the President or a
Vice President and the principal financial or accounting officer or Vice
President - Treasurer of the Company, dated the Closing Date, to the
effect that:
(i) the representations and warranties of the Offerors in this
Agreement are true and correct in all material respects on and
as of the Closing Date with the same effect as if made on the
Closing Date and each Offeror has complied with all the
agreements and satisfied all the conditions on its part to be
performed or satisfied at or prior to the Closing Date; and
(ii) no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for
that purpose have been instituted or, to the Offerors'
knowledge, threatened; and
(iii) subsequent to the Execution Time, there has not occurred
any downgrading, nor has any notice 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 Offerors' securities
(other than any debt security the proceeds of which are used
by such Offeror for current transactions and which has a
maturity not exceeding 270 days from the date such debt
security is issued) by any "nationally recognized statistical
rating organization," as such term is defined for purposes of
Rule 436(g)(2) under the Act.
(g) The Offerors shall have requested and caused
PricewaterhouseCoopers LLP to have furnished to the Representatives at the
Closing Date, a letter, dated as of the Closing Date, in form and
substance satisfactory to the Representatives, confirming that they are
independent accountants within the meaning of the Act and the Exchange Act
and that they have performed a review of the unaudited interim financial
information of the Company for the three-month period ended March 31,
1999, and as at March 31, 1999, in accordance with the Statement on
Auditing Standards No. 71, and stating in effect, except as provided in
Schedule I hereto, that:
(i) in their opinion the audited financial statements and
financial statement schedules and pro forma financial
statements included or incorporated by reference in the
Registration Statement and the Final Prospectus and reported
on
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by them comply as to form in all material respects with the
applicable accounting requirements of the Act and the
Exchange Act;
(ii) on the basis of a reading of the latest unaudited interim
financial statements, if any, made available by the Company
and its subsidiaries; their limited review, in accordance with
standards established under Statement on Auditing Standards
No. 71, of the unaudited interim financial information for the
three-month period ended March 31, 1999 and as at March 31,
1999; a reading of the minutes of the meetings of the Board of
Directors, Committees of the Board of Directors, and the
Stockholder of the Company; and inquiries of certain officials
of the Company who have responsibility for financial and
accounting matters of the Company and its subsidiaries as to
transactions and events subsequent to December 31, 1998,
nothing came to their attention which caused them to believe
that:
(1) any unaudited financial statements included or
incorporated by reference in the Registration Statement
and the Final Prospectus do not comply as to form in all
material respects with applicable accounting
requirements of the Act and the Exchange Act; and said
unaudited financial statements are not in conformity
with generally accepted accounting principles applied on
a basis substantially consistent with that of the
audited financial statements included or incorporated by
reference in the Registration Statement and the Final
Prospectus.
(2) With respect to the period subsequent to December
31, 1998, there were any changes, at a specified date
not more than five days prior to the date of the letter,
in the common stock, cumulative preferred stock without
mandatory redemption, company-obligated mandatorily
redeemable preferred securities or long-term debt of the
Company or decreases in the common stockholder's equity
(except as occasioned by the declaration of dividends)
as compared with the amounts shown on the December 31,
1998 consolidated balance sheet included or incorporated
by reference in the Registration Statement and the Final
Prospectus, or for the period from January 1, 1999 to
such specified date, there were any decreases, as
compared with the corresponding
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period in the preceding year, in operating income or net
income of the Company and its subsidiaries, except in
all instances for changes or decreases set forth in such
letter, in which case the letter shall be accompanied by
an explanation by the Company as to the significance
thereof unless said explanation is not deemed necessary
by the Representatives.
(iii) they have performed certain other specified procedures
as a result of which they determined that certain information of an
accounting, financial or statistical nature (which is limited to
accounting, financial or statistical information derived from the
general accounting records of the Company and its subsidiaries) set
forth in the Registration Statement and the Final Prospectus and in
Exhibit 12 to the Registration Statement, the information included
or incorporated by reference in Items 1, 2, 6 and 7 of the Company's
Annual Report on Form 10-K, incorporated by reference in the
Registration Statement and the Final Prospectus, the information
included in the "Management's Discussion and Analysis of Financial
Condition and Results of Operations" included in the Company's
Quarterly Report on Form 10-Q for the period ending March 31, 1999,
incorporated by reference in the Registration Statement and the
Final Prospectus, and the pro forma information appearing as Exhibit
99 to the Company's Annual Report on Form 10-K, incorporated by
reference in the Registration Statement and the Final Prospectus,
agrees with the accounting records of the Company and its
subsidiaries, excluding any questions of legal interpretation;
(iv) on the basis of a reading of the unaudited pro forma
financial statements included or incorporated by reference in the
Registration Statement and the Final Prospectus (the "pro forma
financial statements"); carrying out certain specified procedures;
inquiries of certain officials of the Company who have
responsibility for financial and accounting matters; and proving the
arithmetic accuracy of the application of the pro forma adjustments
to the historical amounts in the pro forma financial statements,
nothing came to their attention which caused them to believe that
the pro forma financial statements do not comply as to form in all
material respects with the applicable accounting requirements of
Rule 11-02 of Regulation S-X or that the pro forma adjustments have
not been properly applied to the historical amounts in the
compilation of such statements.
- 26 -
<PAGE>
References to the Final Prospectus in this paragraph (g) include any
supplement thereto at the date of the letter.
(h) Subsequent to the Execution Time or, if earlier, the dates
as of which information is given in the Registration Statement
(exclusive of any amendment thereof) and the Final Prospectus
(exclusive of any supplement thereto), there shall not have been (i)
any change or decrease specified in the letter or letters referred
to in paragraph (g) of this Section 6 or (ii) any change, or any
development involving a prospective change, in or affecting the
condition (financial or otherwise), earnings, business or properties
of the Trust, the Partnership or the Company and its subsidiaries,
taken as a whole, whether or not arising from transactions in the
ordinary course of business, except as set forth in or contemplated
in the Final Prospectus (exclusive of any supplement thereto) the
effect of which, in any case referred to in clause (i) or (ii)
above, is, in the sole judgment of the Representatives, so material
and adverse as to make it impractical or inadvisable to proceed with
the offering or delivery of the Offered Securities as contemplated
by the Registration Statement (exclusive of any amendment thereof)
and the Final Prospectus (exclusive of any supplement thereto).
(i) Subsequent to the Execution Time, there shall not have
been any decrease in the rating of any of the Offerors' securities
(other than any debt security the proceeds of which are used by such
Offeror for current transactions and which has a maturity not
exceeding 270 days from the date such debt security is issued) by
any "nationally recognized statistical rating organization" (as
defined for purposes of Rule 436(g) under the Act) or any notice
given of any intended or potential decrease in any such rating or of
a possible change in any such rating that does not indicate the
direction of the possible change.
(j) At the Closing Date, the Trust Securities shall have been
duly approved for listing, subject to notice of issuance, on the New
York Stock Exchange.
(k) Neither a Tax Event nor an Investment Company Event (as
defined in the Final Prospectus) shall have occurred and be
continuing; provided that it shall also be a condition of the
Offerors' obligations hereunder, to issue and sell the Offered
Securities, that neither a Tax Event nor an Investment Company Event
shall have occurred and be continuing.
(l) Prior to the Closing Date, the Offerors shall
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<PAGE>
have furnished to the Representatives such further information,
certificates and documents as the Representatives may reasonably
request.
If any of the conditions specified in this Section 6 shall not have
been fulfilled in all material respects when and as provided in this
Agreement, or if any of the opinions and certificates mentioned above or
elsewhere in this Agreement shall not be in all material respects
reasonably satisfactory in form and substance to the Representatives and
counsel for the Underwriters, this Agreement and all obligations of the
Underwriters hereunder may be canceled at, or at any time prior to, the
Closing Date by the Representatives. Notice of such cancellation shall be
given to the Company in writing or by telephone or facsimile confirmed in
writing.
The documents required to be delivered by this Section 6 shall be
delivered at the office of Berlack, Israels & Liberman LLP, counsel for
the Company, at 120 West 45th Street, New York, New York 10036, on the
Closing Date.
7. Reimbursement of Underwriters' Expenses. If the sale of the Trust
Securities provided for herein is not consummated because any condition to
the obligations of the Underwriters set forth in Section 6 hereof is not
satisfied, because of any termination pursuant to Section 10 hereof or
because of any refusal, inability or failure on the part of the Offerors
to perform any agreement herein or comply with any provision hereof other
than by reason of a default by any of the Underwriters, the Offerors will
reimburse the Underwriters severally through Morgan Stanley & Co.
Incorporated on demand for all out-of-pocket expenses (including
reasonable fees and disbursements of counsel) that shall have been
incurred by them in connection with the proposed purchase and sale of the
Trust Securities.
8. Indemnification and Contribution. (a) The Offerors agree jointly
and severally to indemnify and hold harmless each Underwriter, the
directors, officers, employees and agents of each Underwriter and each
person who controls any Underwriter within the meaning of either the Act
or the Exchange Act against any and all losses, claims, damages or
liabilities, joint or several, to which they or any of them may become
subject under the Act, the Exchange Act or other Federal or state
statutory law or regulation, at common law or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement for
the registration of the Offered Securities as originally filed or in any
amendment thereof, or in the Basic Prospectus, any Preliminary Final
Prospectus or the Final
- 28 -
<PAGE>
Prospectus, or in any amendment thereof 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 agree to reimburse each such
indemnified party, as incurred, for any legal or other expenses reasonably
incurred by them in connection with investigating or defending any such
loss, claim, damage, liability or action; provided, however, that the
Offerors will not be liable in any such case to the extent that any such
loss, claim, damage or liability arises out of or is based upon any such
untrue statement or alleged untrue statement or omission or alleged
omission made therein in reliance upon and in conformity with written
information furnished to the Offerors by or on behalf of any Underwriter
through the Representatives specifically for inclusion therein; provided,
further, that with respect to any untrue statement or omission of material
fact made in any Preliminary Final Prospectus, the indemnity agreement
contained in this Section 8(a) shall not inure to the benefit of any
Underwriter from whom the person asserting any such loss, claim, damage or
liability purchased the Trust Securities concerned, to the extent that any
such loss, claim, damage or liability of such Underwriter occurs under the
circumstances where it shall have been determined by a court of competent
jurisdiction by final and nonappealable judgment that (w) the Offerors had
previously furnished copies of the Final Prospectus to the
Representatives, (x) delivery of the Final Prospectus was required by the
Act to be made to such person, (y) the untrue statement or omission of a
material fact contained in the Preliminary Final Prospectus was corrected
in the Final Prospectus and (z) there was not sent or given to such
person, at or prior to the written confirmation of the sale of the Offered
Securities to such person, a copy of the Final Prospectus. This indemnity
agreement will be in addition to any liability which any of the Offerors
may otherwise have.
(b) Each Underwriter severally and not jointly agrees to indemnify
and hold harmless the Offerors, each of their directors, each of their
officers who signs the Registration Statement, and each person who
controls the Offerors within the meaning of either the Act or the Exchange
Act, to the same extent as the foregoing indemnity from the Offerors to
each Underwriter, but only with reference to written information relating
to such Underwriter furnished to the Offerors by or on behalf of such
Underwriter through the Representatives specifically for inclusion in the
documents referred to in the foregoing indemnity. This indemnity agreement
will be in addition to any liability which any Underwriter may otherwise
have. The Offerors acknowledge that the statements set forth in the last
paragraph of the cover page regarding delivery of the Offered Securities
and, under the heading "Underwriting", (i) the list of Underwriters and
their respective
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<PAGE>
participation in the sale of the Offered Securities, (ii) the sentences
related to concessions and reallowances and (iii) the paragraphs related
to stabilization, syndicate covering transactions and penalty bids in any
Preliminary Final Prospectus and the Final Prospectus constitute the only
information furnished in writing by or on behalf of the several
Underwriters for inclusion in any Preliminary Final Prospectus or the
Final Prospectus.
(c) Promptly after receipt by an indemnified party under this
Section 8 of notice of the commencement of any action, such indemnified
party will, if a claim in respect thereof is to be made against the
indemnifying party under this Section 8, notify the indemnifying party in
writing of the commencement thereof; but the failure so to notify the
indemnifying party (i) will not relieve it from liability under paragraph
(a) or (b) above unless and to the extent such failure results in the loss
by the indemnifying party of substantial rights and defenses and (ii) will
not, in any event, relieve the indemnifying party from any obligations to
any indemnified party other than the indemnification obligation provided
in paragraph (a) or (b) above. The indemnifying party shall be entitled to
appoint counsel of the indemnifying party's choice at the indemnifying
party's expense to represent the indemnified party in any action for which
indemnification is sought (in which case the indemnifying party shall not
thereafter be responsible for the fees and expenses of any separate
counsel retained by the indemnified party or parties except as set forth
below); provided, however, that such counsel shall be reasonably
satisfactory to the indemnified party. Notwithstanding the indemnifying
party's election to appoint counsel to represent the indemnified party in
an action, the indemnified party shall have the right to employ separate
counsel (including local counsel retained in the indemnified party's
reasonable judgment), and the indemnifying party shall bear the reasonable
fees, costs and expenses of such separate counsel if (i) the actual or
potential defendants in, or targets of, any such action include both the
indemnified party and the indemnifying party and the indemnified party
shall have reasonably concluded upon advice of counsel that there may be
legal defenses available to it and/or other indemnified parties which are
different from or additional to those available to the indemnifying party,
or (ii) the indemnifying party shall authorize the indemnified party to
employ separate counsel at the expense of the indemnifying party. An
indemnifying party will not, without the prior written consent of the
indemnified parties, settle or compromise or consent to the entry of any
judgment with respect to any pending or threatened claim, action, suit or
proceeding in respect of which indemnification or contribution may be
sought hereunder (whether or not the indemnified parties are actual or
potential parties to such claim or action) unless such
- 30 -
<PAGE>
settlement, compromise or consent includes an unconditional release of
each indemnified party from all liability arising out of such claim,
action, suit or proceeding.
(d) In the event that the indemnity provided in paragraph (a) or (b)
of this Section 8 is held unavailable, in whole or in part, to hold
harmless an indemnified party for any reason, the Offerors, jointly and
severally, and the Underwriters, severally and not jointly, agree to
contribute to the aggregate losses, claims, damages and liabilities
(including legal or other expenses reasonably incurred in connection with
investigating or defending same) (collectively "Losses") to which the
Offerors and one or more of the Underwriters may be subject in such
proportion as is appropriate to reflect the relative benefits received by
the Offerors on the one hand and by the Underwriters on the other from the
offering of the Offered Securities; provided, however, that in no case
shall any Underwriter (except as may be provided in any agreement among
underwriters relating to the offering of the Trust Securities) be
responsible for any amount in excess of the underwriting discount or
commission applicable to the Trust Securities purchased by such
Underwriter hereunder. If the allocation provided by the immediately
preceding sentence is held unavailable for any reason, the Offerors,
jointly and severally, and the Underwriters, severally and not jointly,
shall contribute in such proportion as is appropriate to reflect not only
such relative benefits but also the relative fault of the Offerors on the
one hand and of the Underwriters on the other in connection with the
statements or omissions which resulted in such Losses as well as any other
relevant equitable considerations. Benefits received by the Offerors shall
be deemed to be equal to the total net proceeds from the offering (before
deducting expenses) received by the Trust, and benefits received by the
Underwriters shall be deemed to be equal to the total underwriting
discounts and commissions, in each case as set forth on the cover page of
the Final Prospectus. Relative fault shall be determined by reference to,
among other things, whether any untrue or any alleged untrue statement of
a material fact or the omission or alleged omission to state a material
fact relates to information provided by the Offerors on the one hand or
the Underwriters on the other, the intent of the parties and their
relative knowledge, access to information and opportunity to correct or
prevent such untrue statement or omission. The Offerors and the
Underwriters agree that it would not be just and equitable if contribution
were determined by pro rata allocation or any other method of allocation
which does not take account of the equitable considerations referred to
above. Notwithstanding the provisions of this paragraph (d), 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
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<PAGE>
misrepresentation. For purposes of this Section 8, each person who
controls an Underwriter within the meaning of either the Act or the
Exchange Act and each director, officer, employee and agent of an
Underwriter shall have the same rights to contribution as such
Underwriter, and each person who controls any of the Offerors within the
meaning of either the Act or the Exchange Act, each officer of any of the
Offerors who shall have signed the Registration Statement and each
director of any of the Offerors shall have the same rights to contribution
as such Offeror, subject in each case to the applicable terms and
conditions of this paragraph (d).
9. Default by an Underwriter. If any one or more Underwriters shall
fail to purchase and pay for any of the Trust Securities agreed to be
purchased by such Underwriter or Underwriters hereunder and such failure
to purchase shall constitute a default in the performance of its or their
obligations under this Agreement, the remaining Underwriters shall be
obligated severally to take up and pay for (in the respective proportions
which the number of Trust Securities set forth opposite their names in
Schedule II hereto bears to the aggregate number of Trust Securities set
forth opposite the names of all the remaining Underwriters) the Trust
Securities which the defaulting Underwriter or Underwriters agreed but
failed to purchase; provided, however, that in the event that the
aggregate number of Trust Securities which the defaulting Underwriter or
Underwriters agreed but failed to purchase shall exceed 10% of the
aggregate number of Trust Securities set forth in Schedule II hereto, the
remaining Underwriters shall have the right to purchase all, but shall not
be under any obligation to purchase any, of the Trust Securities, and if
such nondefaulting Underwriters do not purchase all the Trust Securities,
then the Offerors shall be entitled to a period of thirty-six hours within
which to procure another party or other parties reasonably satisfactory to
the Representatives to purchase such remaining Trust Securities on the
terms contained herein; if after giving effect to arrangements for the
purchase of the Trust Securities of the defaulting Underwriter or
Underwriters by the nondefaulting Underwriters and the Offerors,
unpurchased Trust Securities still remain, this Agreement will terminate
without liability to any nondefaulting Underwriter or the Offerors. In the
event of a default by any Underwriter as set forth in this Section 9, the
Closing Date shall be postponed for such period, not exceeding five
Business Days, as the Representatives shall determine in order that the
required changes in the Registration Statement and the Final Prospectus or
in any other documents or arrangements may be effected. Nothing contained
in this Agreement shall relieve any defaulting Underwriter of its
liability, if any, to the Offerors and any nondefaulting Underwriter for
damages occasioned by its default hereunder.
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<PAGE>
10. Termination. This Agreement shall be subject to termination, in
the absolute discretion of the Representatives, by notice given to the
Offerors if (a) after the execution and delivery of this Agreement and
prior to the Closing Date (i) trading generally shall have been suspended
or limited on or by, as the case may be, any of the New York Stock
Exchange, the American Stock Exchange or the National Association of
Securities Dealers, Inc., or minimum prices shall have been established on
or by, as the case may be, any of the foregoing, (ii) trading of any
securities of any Offeror shall have been suspended on any exchange or in
any over-the-counter market, (iii) a general moratorium on commercial
banking activities in New York shall have been declared by either Federal
or New York State authorities, or (iv) there shall have occurred any
outbreak or escalation of hostilities or any change in financial markets
or any calamity or crisis that, in the judgment of the Representatives, is
material and adverse and (b) in the case of any of the events specified in
clauses (i) through (iv), such event, singly or together with any other
such event, makes it, in the judgment of the Representatives,
impracticable to market the Offered Securities on the terms and in the
manner contemplated in the Final Prospectus or the Preliminary Final
Prospectus.
11. Representations and Indemnities to Survive. The respective
agreements, representations, warranties, indemnities and other statements
of the Offerors and of the Underwriters set forth in or made pursuant to
this Agreement will remain in full force and effect, regardless of any
investigation made by or on behalf of any Underwriter or the Offerors or
any of the officers, directors, employees, agents or controlling persons
referred to in Section 8 hereof, and will survive delivery of and payment
for the Trust Securities. The provisions of Sections 7 and 8 hereof shall
survive the termination or cancellation of this Agreement.
12. Notices. All communications hereunder will be in writing and
effective only on receipt, and, if sent to the Representatives, will be
mailed, delivered or telefaxed to the Morgan Stanley & Co. Incorporated
Debt Syndicate Desk (fax no.: (212) 761-0781) and confirmed to Morgan
Stanley & Co. at 1585 Broadway, New York, New York 10036, Attention: Debt
Syndicate Desk; or, if sent to any of the Offerors, will be mailed,
delivered or telefaxed to Mr. Terrance G. Howson, Vice President and
Treasurer, GPU Service, Inc., 310 Madison Avenue, Morristown, New Jersey
07962-1957, (fax no.: (973) 644-4224) and confirmed to it at Berlack,
Israels & Liberman LLP, attention Douglas E. Davidson, Esq.
13. Successors. This Agreement will inure to the benefit of
and be binding upon the parties hereto and their respective successors
and the officers, directors, employees,
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<PAGE>
agents and controlling persons referred to in Section 8 hereof, and no
other person will have any right or obligation hereunder.
14. Applicable Law. This Agreement will be governed by and construed
in accordance with the laws of the State of New York applicable to
contracts made and to be performed within the State of New York.
15. Counterparts. This Agreement may be signed in two or more
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same agreement.
16. Headings. The section headings used herein are for convenience
only and shall not affect the construction hereof.
17. Underwriter's Counsel. The Offerors and the Underwriters
acknowledge that Thelen Reid & Priest LLP (a) will act as counsel to the
Underwriters in connection with this Agreement and the transactions
contemplated hereby and (b) historically has acted, and may continue to
act, as counsel to the Company in connection with certain special
projects, and the Offerors and the Underwriters consent to such dual
representation.
18. Definitions. The terms which follow, when used in this
Agreement, shall have the meanings indicated.
"Act" shall mean the Securities Act of 1933, as amended, and the
rules and regulations of the Commission promulgated thereunder.
"Basic Prospectus" shall mean the prospectus referred to in
paragraph 1(a) above contained in the Registration Statement at the
Effective Date including any Preliminary Final Prospectus.
"Business Day" shall mean any day other than a Saturday, a Sunday or
a legal holiday or a day on which banking institutions or trust companies
are authorized or obligated by law to close in New York City.
"Commission" shall mean the Securities and Exchange Commission.
"Effective Date" shall mean the later of (a) each date and time that
the Registration Statement, any post-effective amendment or amendments
thereto and any Rule 462(b) Registration Statement became or become
effective and (b) the date of the filing with the Commission of the
Company's most recent Annual Report on Form 10-K.
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<PAGE>
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Commission promulgated
thereunder.
"Execution Time" shall mean the date and time that this Agreement is
executed and delivered by the parties hereto.
"Final Prospectus" shall mean the prospectus supplement relating to
the Offered Securities that was first filed pursuant to Rule 424(b) after
the Execution Time, together with the Basic Prospectus.
"Indenture Trustee" shall mean United States Trust Company of New
York, as Trustee under the Indenture.
"Preliminary Final Prospectus" shall mean any preliminary prospectus
supplement to the Basic Prospectus which describes the Offered Securities
and the offering thereof and is used prior to filing of the Final
Prospectus, together with the Basic Prospectus.
"Property Trustee" shall mean The Bank of New York, as Property
Trustee under the Trust Agreement.
"Registration Statement" shall mean the registration statement
referred to in paragraph 1(a) above, including exhibits and financial
statements, as amended at the Execution Time (or, if not effective at the
Execution Time, in the form in which it shall become effective) and, in
the event any post-effective amendment thereto or any Rule 462(b)
Registration Statement becomes effective prior to the Closing Date, shall
also mean such registration statement as so amended or such Rule 462(b)
Registration Statement, as the case may be.
"Rule 415", "Rule 424" and "Rule 462" refer to such rules under the
Act.
"Rule 462(b) Registration Statement" shall mean a registration
statement and any amendments thereto filed pursuant to Rule 462(b)
relating to the offering covered by the registration statement referred to
in Section 1(a) hereof.
"Trust Indenture Act" shall mean the Trust Indenture Act of 1939, as
amended, and the rules and regulations of the Commission promulgated
thereunder.
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<PAGE>
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof,
whereupon this letter and your acceptance shall represent a binding
agreement among the Offerors and the several Underwriters.
Very truly yours,
MET-ED CAPITAL TRUST
By: Met-Ed Capital II, L.P.,
the Grantor
By: Met-Ed Preferred Capital II, Inc.,
its general partner
By:
--------------------------
Name:
Title:
MET-ED CAPITAL II, L.P.
By: Met-Ed Preferred Capital II, Inc.,
its general partner
By:
---------------------------
Name:
Title:
METROPOLITAN EDISON COMPANY
By:
---------------------------
Name:
Title:
- 36 -
<PAGE>
The foregoing Agreement is
hereby confirmed and accepted
as of the date specified in
Schedule I hereto.
Morgan Stanley & Co. Incorporated
A.G. Edwards & Sons, Inc.
Banc One Capital Markets, Inc.
Legg Mason Wood Walker, Incorporated
Salomon Smith Barney Inc.
For themselves and the other
several Underwriters, if any,
named in Schedule II to the
foregoing Agreement.
By: MORGAN STANLEY & CO. INCORPORATED
------------------------------------
Name:
Title:
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<PAGE>
SCHEDULE I
Underwriting Agreement dated May 24, 1999.
Registration Statement Nos.:
333-62967, 333-62967-01, 333-62967-02
Representatives:
Morgan Stanley & Co. Incorporated
A.G. Edwards & Sons, Inc.
Banc One Capital Markets, Inc.
Legg Mason Wood Walker, Incorporated
Salomon Smith Barney Inc.
Title, Number, Purchase Price and Description of Trust Securities:
Purchase
Title Number Price
- ----- ------ -----
7.35% Trust Preferred Securities
(Liquidation amount $25 per
Trust Preferred Securities) 4,000,000 $100,000,000
Mandatory redemption provisions: As described in the Final Prospectus.
Optional redemption provisions: As described in the Final Prospectus.
Other provisions: As described in the Final Prospectus.
Closing Date, Time and Location: May 28, 1999 at 10:00 a.m. at
Berlack, Israels & Liberman LLP
120 West 45th Street
New York, New York 10036
Type of Offering: Non-delayed
Date referred to in Section 5(f) after which the Offerors may offer or sell debt
securities or preferred securities (including any preferred limited partnership
interests or preferred beneficial interests) issued or guaranteed by any Offeror
without the consent of the Representative(s):
May 28, 1999
Modification of items to be covered by the letter from PricewaterhouseCoopers
LLP delivered pursuant to Section 6(g) at the Closing Date:
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<PAGE>
SCHEDULE II
Number of Trust Securities to be Purchased
Underwriters
Morgan Stanley & Co. Incorporated 612,000
A.G. Edwards & Sons, Inc. 612,000
Banc One Capital Markets, Inc. 612,000
Legg Mason Wood Walker, Incorporated 612,000
Salomon Smith Barney Inc. 612,000
ABN Amro Incorporated 60,000
Blaylock & Partners, L.P. 60,000
BT Alex, Brown Incorporated 60,000
CIBC World Markets Corp. 60,000
First Union Capital Markets Corp. 60,000
Janney Montgomery Scott Inc. 60,000
McDonald Investments Inc., a Keycorp Company 60,000
Muriel Siebert & Co., Inc. 60,000
Prudential Securities Incorporated 60,000
SG Cowen Securities Corporation 60,000
Advest, Inc. 20,000
Dain Rauscher Incorporated 20,000
Fahnestock & Co. Inc. 20,000
Ferris, Baker Watts, Incorporated 20,000
Fidelity Capital Markets, a division of National
Financial Services Corporation 20,000
Fleet Securities, Inc. 20,000
Gibraltar Securities Co. 20,000
J.J.B. Hilliard, W.L. Lyons, Inc. 20,000
Olde Discount Corporation 20,000
Pryor, McClendon, Counts & Co., Inc. 20,000
Raymond James & Associates, Inc. 20,000
The Robinson-Humphrey Company, LLC 20,000
Charles Schwab & Co., Inc. 20,000
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<PAGE>
Tucker Anthony Incorporated 20,000
U.S. Bancorp Piper Jaffray Inc. 20,000
Utendahl Capital Partners, L.P. 20,000
The Williams Capital Group, L.P. 20,000
Total 4,000,000
=========
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Exhibit 8
May 24, 1999
Metropolitan Edison Company
2800 Pottsville Pike
Reading, Pennsylvania 19605
Met-Ed Capital II, L.P.
c/o GPU Service, Inc.
310 Madison Avenue
Morristown, NJ 07962
Met-Ed Capital Trust
c/o GPU Service, Inc.
310 Madison Avenue
Morristown, NJ 07962
Re: Metropolitan Edison Company, Met-Ed Capital II,
L.P., and Met-Ed Capital Trust - Trust Securities
Dear Gentlemen:
We have acted as special tax and ERISA counsel to Metropolitan
Edison Company, a Pennsylvania corporation (the "Company"), Met-Ed Capital II,
L.P., a Delaware limited partnership ("Met-Ed Capital"), and Met-Ed Capital
Trust, a Delaware business trust (the "Trust") in connection with the proposed
issuance and sale of up to a maximum of $100,000,000 aggregate initial offering
price of interests of the Trust (the "Trust Securities") the proceeds of which
will be used to purchase limited partnership interests in Met-Ed Capital (the
"Preferred Securities"), the proceeds of which, together with the capital
contribution of Met-Ed Preferred Capital II, Inc., the general partner of Met-Ed
Capital, will be used to purchase Subordinated Debentures of the Company
pursuant to a prospectus (the "Basic Prospectus") which constitutes a part of a
registration statement on Form S-3 under the Securities Act of 1933, as amended
(the "Securities Act"), which was initially filed on September 4, 1998
<PAGE>
Metropolitan Edison Company -2-
and amended by Amendment No. 1 filed on February 4, 1999, with the Securities
and Exchange Commission (the "Registration Statement") and the Prospectus
Supplement dated May 24, 1999 (the "Prospectus Supplement", and together with
the Basic Prospectus, the "Prospectus").
We have examined originals or copies, certified or otherwise
identified to our satisfaction, of those agreements, certificates and other
statements of corporate officers and other representatives of the Company,
Met-Ed Capital and the Trust, as we have deemed necessary as a basis for this
opinion. In such examination, we have assumed the genuineness of all signatures
and the authenticity of all documents submitted to us as originals and the
conformity with the originals of all documents submitted to us as copies.
Based on and subject to the foregoing, we are of the opinion that:
(i) the section entitled "Certain Federal Income Tax Considerations" in the
Prospectus contains an accurate general description, under currently applicable
law, of the material United States federal income tax considerations that apply
to holders of the Trust Securities; and (ii) the section entitled "ERISA
Considerations" in the Prospectus contains an accurate general description,
under currently applicable law, of the material ERISA considerations that apply
to holders of the Trust Securities.
We consent to the filing of this opinion as an Exhibit to the
Registration Statement and to the references to our firm under the caption
"Certain Federal Income Tax Considerations" in the Prospectus. In giving this
consent we do not hereby agree that we come within the category of persons whose
consent is required by the Securities Act or the rules and regulations
promulgated thereunder.
Very truly yours,
Carter, Ledyard & Milburn
JJC:jdr
