EXHIBIT 1.4
WISCONSIN ENERGY CORPORATION
DEBT SECURITIES
UNDERWRITING AGREEMENT
New York, New York
Dated the date set
forth in Schedule B hereto
To the Underwriters set forth
on Schedule A hereto
Ladies and Gentlemen:
Wisconsin Energy Corporation, a Wisconsin corporation (the "Company"),
proposes to issue and sell to one or more underwriters (the "Underwriters")
named in Schedule A to this underwriting agreement (this "Agreement") the
aggregate principal amount of one or more new series of its debt securities (the
"Securities") set forth in Schedule B hereto. The Securities will be issued
under an indenture, dated as of March 15, 1999 (the "Indenture"), between the
Company and Bank One Trust Company, National Association (successor to The First
National Bank of Chicago), as Trustee (the "Trustee"), in one or more series,
which series may vary as to interest rates, maturities, redemption provisions,
selling prices and other terms, with all such terms for any particular series of
the Securities being determined at the time of sale.
The Company understands that the Underwriters propose to make a public
offering of the Securities as soon as their representative or representatives
identified on Schedule B hereto (the "Representatives") deem advisable after
this Agreement has been executed and delivered.
SECTION 1. Representations and Warranties.
(a) Representations and Warranties by the Company. The Company
represents and warrants to each Underwriter and agrees with each Underwriter, as
follows:
(i) Compliance with Registration Requirements. The Company meets the
requirements for use of Form S-3 under the Securities Act of 1933, as
amended (the "1933 Act"). The Company has filed with the Securities and
Exchange Commission (the "Commission") a registration statement on such
Form (having the number(s) set forth on Schedule B hereto), which has
become effective (including information (if any) deemed to be part of the
registration statement at the time of effectiveness pursu-
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ant to Rule 430A under the 1933 Act), for the registration under the 1933
Act of the Securities. Such registration statement meets the requirements
set forth in Rule 415(a)(1)(x) under the 1933 Act and complies in all other
material respects with said Rule, and as amended at the date of this
Agreement, including the exhibits thereto, is hereinafter called the
"Registration Statement". The form of prospectus included in such
Registration Statement is hereinafter called the "Basic Prospectus"; the
form of prospectus supplement included in such Registration Statement, or,
if the Company files with the Commission a subsequent prospectus supplement
to be used in connection with the issuance and sale of the Securities under
the Prospectus in accordance with Rule 424(b) under the 1933 Act, such
subsequent prospectus supplement, is hereinafter called the "Prospectus
Supplement"; and the Basic Prospectus, as supplemented by the Prospectus
Supplement, in the form in which it shall be filed with the Commission
pursuant to Rule 424(b) is hereinafter called the "Prospectus". Any
preliminary form of the Prospectus which has heretofore been filed pursuant
to Rule 424(b) is hereinafter called the "Preliminary Prospectus". Any
reference herein to the Registration Statement, the Basic Prospectus, any
Preliminary Prospectus or the Prospectus shall be deemed to refer to and
include the documents incorporated by reference therein pursuant to Item 12
of Form S-3 which were filed under the Securities Exchange Act of 1934, as
amended (the "1934 Act"), on or before the date of this Agreement, or the
issue date of the Basic Prospectus, any Preliminary Prospectus or the
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 Prospectus or the
Prospectus shall be deemed to refer to and include the filing of any
document under the 1934 Act after the date of this Agreement, or the issue
date of the Basic Prospectus, any Preliminary Prospectus or the Prospectus,
as the case may be, deemed to be incorporated therein by reference.
(ii) No Misstatements or Omissions. As of the date hereof, when the
Prospectus is first filed or transmitted for filing pursuant to Rule 424(b)
under the 1933 Act, when, prior to Closing Time (as hereinafter defined),
any amendment to the Registration Statement becomes effective (including
the filing of any document incorporated by reference in the Registration
Statement), when any supplement to the Prospectus is filed with the
Commission and at the Closing Time, (i) the Registration Statement, as then
amended as of any such time, and the Prospectus, as then amended or
supplemented as of such time, and the Indenture will comply in all material
respects with the applicable requirements of the 1933 Act, the Trust
Indenture Act of 1939, as amended (the "1939 Act"), and the 1934 Act and
the respective rules thereunder and (ii) the Registration Statement, when
it became effective or as then amended as of such time, 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 and (iii) the Prospectus, as then
amended or supplemented as of such time, did not or will not contain any
untrue statement of material
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fact or omit to state any material fact necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading; provided, however, that the Company makes no representations or
warranties as to (i) that part of the Registration Statement which shall
constitute the Statement of Eligibility on Form T-1 (the "Form T-1") under
the 1939 Act of the Trustee or (ii) the information contained in or omitted
from the Registration Statement or the Prospectus or any amendment thereof
or supplement thereto in reliance upon and in conformity with information
furnished in writing to the Company by or on behalf of any Underwriter
through the Representatives specifically for use in the Registration
Statement and the Prospectus.
(iii) Authorization of Agreement. This Agreement has been duly
authorized, executed and delivered by the Company.
(iv) Authorization of the Indenture. The Indenture has been duly
authorized by the Company and duly qualified under the 1939 Act and
constitutes a valid and binding agreement of the Company, enforceable
against the Company in accordance with its terms, except as the enforcement
thereof may be limited by bankruptcy, insolvency (including, without
limitation, all laws relating to fraudulent transfers), reorganization,
moratorium or similar laws affecting enforcement of creditors' rights
generally and except as enforcement thereof is subject to general
principles of equity (regardless of whether enforcement is considered in a
proceeding in equity or at law).
(v) Authorization of the Securities. The Securities have been duly
authorized and, at the Closing Time, will have been duly executed by the
Company and, when authenticated, issued and delivered in the manner
provided for in the Indenture and delivered against payment of the purchase
price therefor as provided in this Agreement, will constitute valid and
binding obligations of the Company, enforceable against the Company in
accordance with their terms, except as the enforcement thereof may be
limited by bankruptcy, insolvency (including, without limitation, all laws
relating to fraudulent transfers), reorganization, moratorium or similar
laws affecting enforcement of creditors' rights generally and except as
enforcement thereof is subject to general principles of equity (regardless
of whether enforcement is considered in a proceeding in equity or at law),
and will be in the form contemplated by, and entitled to the benefits of,
the Indenture.
(vi) Description of the Securities and the Indenture. The Securities
and the Indenture will conform in all material respects to the respective
statements relating thereto contained in the Prospectus and will be in
substantially the respective forms filed or incorporated by reference, as
the case may be, as exhibits to the Registration Statement.
(vii) Absence of Defaults and Conflicts. Neither the Company nor any
"significant subsidiary" of the Company (as such term is defined in Rule
1-02 of Regula-
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tion S-X) (each, a "Subsidiary" and collectively, the "Subsidiaries" and
each of which is listed on Schedule C hereto) is in violation of its
charter or by-laws or in default in the performance or observance of any
obligation, agreement, covenant or condition contained in any contract,
indenture, mortgage, deed of trust, loan or credit agreement, note, lease
or other agreement or instrument to which the Company or any of its
Subsidiaries is a party or by which it or any of them may be bound, or to
which any of the property or assets of the Company or any Subsidiary is
subject (collectively, "Agreements and Instruments") except for such
defaults as would not have a material adverse effect on the condition,
financial or otherwise, or on the earnings, business affairs or business
prospects of the Company and its subsidiaries, considered as one
enterprise, whether or not arising in the ordinary course of business (a
"Material Adverse Effect"); and the execution, delivery and performance of
this Agreement and the consummation of the transactions contemplated herein
and in the Registration Statement (including the issuance and sale of the
Securities and the use of the proceeds from the sale of the Securities as
described in the Prospectus under the caption "Use of Proceeds") and
compliance by the Company with its obligations hereunder have been duly
authorized by all necessary corporate action and do not and will not,
whether with or without the giving of notice or passage of time or both,
conflict with or constitute a breach of, or default or Repayment Event (as
defined below) under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company or any
Subsidiary pursuant to, the Agreements and Instruments (except for such
conflicts, breaches, Repayment Events or defaults or liens, charges or
encumbrances that would not result in a Material Adverse Effect), nor will
such action result in any violation of the provisions of the charter or
by-laws of the Company or any Subsidiary or any applicable law, statute,
rule, regulation, judgment, order, writ or decree of any government,
government instrumentality or court, domestic or foreign, having
jurisdiction over the Company or any Subsidiary or any of their assets,
properties or operations. As used herein, a "Repayment Event" means any
event or condition which gives the holder of any note, debenture or other
evidence of indebtedness (or any person acting on such holder's behalf) the
right to require the repurchase, redemption or repayment (through
acceleration or otherwise) of all or a portion of such indebtedness by the
Company or any Subsidiary.
(viii) Absence of Further Requirements. No filing with, or
authorization, approval, consent, license, order, registration,
qualification or decree of, any court or governmental authority or agency
is necessary or required for the performance by the Company of its
obligations hereunder, in connection with the offering, issuance or sale of
the Securities hereunder or the consummation of the transactions
contemplated by this Agreement, except such as have been already obtained
or as may be required under the 1933 Act or the rules and regulations of
the Commission thereunder (the "1933 Act Regulations") or state securities
laws and except for qualification of the Indenture under the 1939 Act.
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(ix) Investment Company Act. The Company is not, and upon the issuance
and sale of the Securities as herein contemplated and the application of
the net proceeds therefrom as described in the Prospectus will not be, an
"investment company" or an entity "controlled" by an "investment company"
as such terms are defined in the Investment Company Act of 1940, as amended
(the "1940 Act").
(x) Public Utility Holding Company Act. The Company is an exempt
public utility holding company under the Pubic Utility Holding Company Act
of 1935, as amended (the "1935 Act"), and as such is exempt from all the
provisions of that act except Section(9)(a)(2) thereof.
(xi) Independent Public Accountants. Each of the independent public
accountants who have certified financial statements of the Company included
or incorporated by reference in the Registration Statement and the
Prospectus are (or, in the case of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP, were during the
periods covered by their report incorporated by reference in the Prospectus
through the date of such report) independent public accountants as required
by the 1933 Act and the 1933 Act Regulations. Additionally, any statements
required by the 1933 Act and the 1933 Act Regulations have been included or
incorporated by reference in the Prospectus reflecting that the Company
terminated its engagement with ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP and engaged Deloitte &
Touche LLP as its independent accountants.
(b) Officer's Certificates. Any certificate signed by any officer of
the Company or any of its Subsidiaries delivered to the Representatives or to
counsel for the Underwriters shall be deemed a representation and warranty by
the Company to each Underwriter as to the matters covered thereby.
SECTION 2. Sale and Delivery to Underwriters; Closing.
(a) Securities. On the basis of the representations and warranties
herein contained and subject to the terms and conditions herein set forth, the
Company agrees to sell to each Underwriter, severally and not jointly, and each
Underwriter, severally and not jointly, agrees to purchase from the Company, at
the price and with the terms set forth in Schedule B, the aggregate principal
amount of Securities set forth in Schedule A opposite the name of such
Underwriter, plus any additional amount of Securities which such Underwriter may
become obligated to purchase pursuant to the provisions of Section 10 hereof.
(b) Payment. Payment of the purchase price for, and delivery of
certificates for, the Securities shall be made at the location specified in
Schedule B hereto or at such other place as shall be agreed upon by the
Representatives and the Company at the Closing Time specified in Schedule B
hereto (unless postponed in accordance with the provisions of Section 10), or
such other time not later than ten business days after such date as shall be
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agreed upon by the Representatives and the Company (such time and date of
payment and delivery being herein called "Closing Time").
Payment shall be made to the Company by wire transfer of immediately
available or next day funds as set forth in Schedule B to a bank account(s)
designated by the Company against delivery to or for the account of the
Representatives for the respective accounts of the Underwriters of certificates
for the Securities to be purchased by them. It is understood that each
Underwriter has authorized the Representatives, for its account, to accept
delivery of, receipt for, and make payment of the purchase price for, the
Securities which it has agreed to purchase.
(c) Denominations; Registration. Certificates for the Securities shall
be in such principal amounts and registered in such names as the Representatives
may request in writing at least one full business day before the Closing Time.
The certificates for the Securities will be made available for examination by
the Representatives not later than 10:00 A.M. (Eastern Time) on the business day
prior to the Closing Time.
SECTION 3. Covenants of the Company. The Company covenants with each
Underwriter as follows:
(a) Compliance with Securities Regulations and Commission Requests.
The Company, subject to Section 3(b), will prepare the Prospectus in a form
approved by the Representatives and file such Prospectus pursuant to Rule
424(b) within the time prescribed under Rule 424(b) or Rule 430(A)(3), as
the case may be) and will notify the Representatives immediately, and
confirm the notice in writing, (i) when any post-effective amendment to the
Registration Statement shall become effective, or any supplement to the
Prospectus or any amended Prospectus shall have been filed, (ii) of the
receipt of any comments from the Commission, (iii) of any request by the
Commission for any amendment to the Registration Statement or any amendment
or supplement to the Prospectus or for additional information, and (iv) of
the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or of any order preventing or
suspending the use of any preliminary prospectus, or of the suspension of
the qualification of the Securities for offering or sale in any
jurisdiction, or of the initiation or threatening of any proceedings for
any of such purposes. The Company will promptly effect the filings
necessary pursuant to Rule 424(b) (or Rule 430(A)(3), as the case may be)
and will take such steps as it deems necessary to ascertain promptly
whether the form of prospectus transmitted for filing under Rule 424(b) was
received for filing by the Commission and, in the event that it was not, it
will promptly file such prospectus. The Company will make every reasonable
effort to prevent the issuance of any stop order and, if any stop order is
issued, to obtain the lifting thereof at the earliest possible moment.
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(b) Filing of Amendments. At any time when a prospectus is required to
be delivered in connection with sales of Securities under the 1933 Act, the
Company will give the Representatives notice of its intention to file or
prepare any amendment to the Registration Statement or any amendment,
supplement or revision to the Prospectus, whether pursuant to the 1933 Act,
the 1934 Act or otherwise, will furnish the Representatives with copies of
any such documents a reasonable amount of time prior to such proposed
filing or use, as the case may be, and will not file or use any such
document to which the Representatives or counsel for the Underwriters shall
object.
(c) Delivery of Registration Statements. The Company has furnished or
will deliver to the Representatives and counsel for the Underwriters,
without charge, two reproduced copies of an original signed copy of the
Registration Statement as originally filed and of each amendment thereto
(including exhibits filed therewith or incorporated by reference therein
and documents incorporated or deemed to be incorporated by reference
therein) and one reproduced copy of an original signed copy of all consents
and certificates of experts, and will also deliver to the Representatives,
without charge, a conformed copy of the Registration Statement as
originally filed and of each amendment thereto (without exhibits) for each
of the Underwriters. The copies of the Registration Statement and each
amendment thereto furnished to the Underwriters will be identical to the
electronically transmitted copies thereof filed with the Commission
pursuant to its Electronic Data Gathering, Analysis and Retrieval System
("▇▇▇▇▇") except to the extent permitted by Regulation S-T under the 1933
Act.
(d) Delivery of Prospectuses. The Company has delivered to each
Underwriter, without charge, as many copies of any Preliminary Prospectus
relating to the Securities as such Underwriter reasonably requested, and
the Company hereby consents to the use of such copies for purposes
permitted by the 1933 Act. The Company will furnish to each Underwriter,
without charge, during the period when the Prospectus is required to be
delivered under the 1933 Act or the 1934 Act, such number of copies of the
Prospectus (as amended or supplemented) as such Underwriter may reasonably
request. The Prospectus and any amendments or supplements thereto furnished
to the Underwriters will be identical to the electronically transmitted
copies thereof filed with the Commission pursuant to ▇▇▇▇▇, except to the
extent permitted by Regulation S-T.
(e) Continued Compliance with Securities Laws. The Company will comply
with the 1933 Act and the 1933 Act Regulations and the 1934 Act and the
rules and regulations of the Commission thereunder (the "1934 Act
Regulations") so as to permit the completion of the distribution of the
Securities as contemplated in this Agreement and in the Prospectus. If at
any time when a prospectus is required by the 1933 Act to be delivered in
connection with sales of the Securities, any event shall occur or condition
shall exist as a result of which it is necessary, in the opinion of coun-
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sel for the Underwriters or for the Company, to amend the Registration
Statement or amend or supplement the Prospectus in order that the
Prospectus 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
not misleading in the light of the circumstances existing at the time it is
delivered to a purchaser, or if it shall be necessary, in the opinion of
such counsel, at any such time to amend the Registration Statement or amend
or supplement the Prospectus in order to comply with the requirements of
the 1933 Act or the 1933 Act Regulations, the Company will promptly prepare
and file with the Commission, subject to Section 3(b), such amendment or
supplement as may be necessary to correct such statement or omission or to
make the Registration Statement or the Prospectus comply with such
requirements, and the Company will furnish to the Underwriters such number
of copies of such amendment or supplement as the Underwriters may
reasonably request.
(f) Blue Sky Qualifications. The Company will use its best efforts, in
cooperation with the Underwriters, to qualify the Securities for offering
and sale under the applicable securities laws of such states and other
jurisdictions (domestic or foreign) as the Representatives may reasonably
designate and to maintain such qualifications in effect for a period of not
less than one year from the date of this Agreement; provided, however, that
the Company shall not be obligated to file any general consent to service
of process or to qualify as a foreign corporation or as a dealer in
securities in any jurisdiction in which it is not so qualified or to
subject itself to taxation in respect of doing business in any jurisdiction
in which it is not otherwise so subject. In each jurisdiction in which the
Securities have been so qualified, the Company will file such statements
and reports as may be required by the laws of such jurisdiction to continue
such qualification in effect for a period of not less than one year from
the date of this Agreement.
(g) Rule 158. The Company will timely file such reports pursuant to
the 1934 Act as are necessary in order to make generally available to its
securityholders as soon as practicable an earnings statement for the
purposes of, and to provide the benefits contemplated by, the last
paragraph of Section 11(a) of the 1933 Act.
(h) Use of Proceeds. The Company will use the net proceeds received by
it from the sale of the Securities in the manner specified in the
Prospectus under "Use of Proceeds."
(i) Listing. The Company will use its best efforts to effect the
listing of the Securities on any such stock exchange or exchanges as are
set forth in Schedule B hereto.
(j) Restriction on Sale of Securities. Until the business day
following the Closing Time, the Company will not, without the prior written
consent of the Repre-
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sentatives, sell or contract to sell or announce the offering of, any debt
securities of the Company with characteristics and terms similar to those
of the Securities.
(k) Reporting Requirements. The Company, during the period when the
Prospectus is required to be delivered under the 1933 Act or the 1934 Act,
will file all documents required to be filed with the Commission pursuant
to the 1934 Act within the time periods required by the 1934 Act and the
1934 Act Regulations.
SECTION 4. Payment of Expenses.
(a) Expenses. The Company will pay or cause to be paid all expenses
incident to the performance of its obligations under this Agreement, including
(i) the preparation, printing and filing of the Registration Statement
(including financial statements and exhibits and the Form T-1) as originally
filed and of each amendment thereto, (ii) the preparation, printing,
reproduction and delivery to the Underwriters of this Agreement, any Agreement
among Underwriters, the Indenture and such other documents as may be required in
connection with the offering, purchase, sale, issuance or delivery of the
Securities, (iii) the preparation, issuance and delivery of the certificates for
the Securities to the Underwriters, including any transfer taxes and any stamp
or other duties payable upon the sale, issuance or delivery of the Securities to
the Underwriters, (iv) the fees and disbursements of the Company's counsel,
accountants and other advisors, (v) the qualification of the Securities under
securities laws in accordance with the provisions of Section 3(f) hereof,
including filing fees and the reasonable fees and disbursements of counsel for
the Underwriters in connection therewith and in connection with the preparation,
reproduction and delivery to the Underwriters of any blue sky or legal
investment survey, (vi) the printing and delivery to the Underwriters of copies
of each Preliminary Prospectus and of the Prospectus and any amendments or
supplements thereto, (vii) the fees and expenses of the Trustee, including the
fees and disbursements of counsel for the Trustee in connection with the
Indenture and the Securities, (viii) any fees payable in connection with the
rating of the Securities, and (ix) the fees and expenses incurred in connection
with the listing, if applicable, of the Securities on any such exchange or
exchanges as are listed on Schedule B hereto.
(b) Termination of Agreement. If this Agreement is terminated by the
Representatives in accordance with the provisions of Section 5 or Section
9(a)(i) hereof, the Company shall reimburse the Underwriters for all of their
out-of-pocket expenses, including the reasonable fees and disbursements of
counsel for the Underwriters.
SECTION 5. Conditions of Underwriters' Obligations. The obligations of
the several Underwriters hereunder are subject to the accuracy of the
representations and warranties of the Company contained in Section 1(a) hereof
or in certificates of any officer of the Company or any Subsidiary of the
Company delivered pursuant to the provisions hereof, to the performance by the
Company of its covenants and other obligations hereunder, and to the following
further conditions:
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(a) Effectiveness of Registration Statement. The Prospectus shall have
been filed with the Commission pursuant to Rule 424(b) within the
applicable time period prescribed for such filing by the 1933 Act
Regulations and in accordance with Section 3(a) hereof; and no stop order
suspending the effectiveness of the Registration Statement or any part
thereof shall have been issued and no proceeding for that purpose shall
have been initiated or threatened by the Commission.
(b) Opinion of Counsel for Company. At Closing Time, the
Representatives shall have received the favorable opinion, dated as of
Closing Time, of (i) ▇▇▇▇▇▇▇ & ▇▇▇▇▇ LLP, counsel for the Company, to the
effect set forth in Exhibit A-1 hereto and (ii) ▇▇▇▇▇ ▇▇▇▇▇▇▇, Esq.,
counsel for the Company, to the effect set forth in Exhibit A-2 hereto,
each in form and substance satisfactory to the Representatives and to
counsel for the Underwriters, together with signed or reproduced copies of
such letter for each of the other Underwriters and addressed to the
Underwriters and to such further effect as the Representatives and counsel
to the Underwriters may reasonably request. In giving such opinion such
counsel may rely, as to all matters governed by the laws of jurisdictions
other than the law of the State of Wisconsin and the federal law of the
United States, upon the opinions of counsel satisfactory to the
Representatives. Such counsel may also state that, insofar as such opinion
involves factual matters, they have relied, to the extent they deem proper,
upon certificates of officers of the Company and its Subsidiaries, the
Trustee and public officials. In rendering its opinion, ▇▇▇▇▇▇▇ & ▇▇▇▇▇ LLP
may rely as to the exempt status of the Company under the Public Utility
Holding Company Act, upon the opinion of ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
(c) Opinion of Counsel for Underwriters. At Closing Time, the
Representatives shall have received the favorable opinion, dated as of
Closing Time, of ▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, the counsel for the Underwriters,
together with signed or reproduced copies of such letter for each of the
other Underwriters and addressed to the Underwriters with respect to such
matters as the Representatives may reasonably request. In giving such
opinion such counsel may rely, as to all matters governed by the laws of
jurisdictions other than the law of the State of New York and the federal
law of the United States (except as to the 1935 Act, as to which they may
rely on the opinion of ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.), upon the opinions of
counsel for the Company, including such counsel referred to above in
Section 5(b) hereof, or other counsel satisfactory to the Representatives.
Such counsel may also state that, insofar as such opinion involves factual
matters, they have relied, to the extent they deem proper, upon
certificates of officers of the Company and its Subsidiaries and
certificates of the Trustee public officials.
In addition, such counsel shall state that they have participated in
conferences with officers and other representatives of the Company,
representatives of the Underwriters and representatives of the independent
public accountants for the Company at
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which conferences the contents of the Prospectus and the Registration
Statement and related matters were discussed, and that given the
limitations inherent in the role of outside counsel and the character of
determinations involved in the preparation of a Registration Statement,
such counsel are not passing upon and do not assume any responsibility for
the accuracy, completeness or fairness of the statements contained in the
Registration Statement or the Prospectus and have made no independent check
or verification thereof (except as otherwise indicated in such letter).
Such counsel shall further state that, on the basis of the foregoing, no
facts have come to their attention that lead them to believe that the
Registration Statement or any amendment thereto, at the time such
Registration Statement or any such amendment became effective, contained an
untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements therein
not misleading or that the Prospectus, as of its date or as of the Closing
Time, contained or contains an untrue statement of a material fact or
omitted or omits to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading (it being understood that such counsel express no
comment with respect to the Form T-1 or the financial statements, including
the notes thereto, or any other financial or statistical data found in or
derived from the internal accounting and other records of the Company set
forth or referred to in the Registration Statement or the Prospectus).
(d) Officers' Certificate. At Closing Time, there shall not have been,
since the date hereof or since the respective dates as of which information
is given in the Prospectus, any material adverse change in the condition,
financial or otherwise, or in the earnings, business affairs or business
prospects of the Company and its subsidiaries, considered as one
enterprise, whether or not arising in the ordinary course of business (a
"Material Adverse Change"), and the Representatives shall have received a
certificate of the President or a Vice President of the Company and of the
chief financial officer, chief accounting officer or treasurer of the
Company, dated as of Closing Time, to the effect that (i) there has been no
such Material Adverse Change, (ii) the representations and warranties in
Section 1(a) hereof are true and correct in all material respects, with the
same force and effect as though expressly made at and as of Closing Time,
(iii) the Company has complied with all agreements and satisfied all
conditions on its part to be performed or satisfied at or prior to Closing
Time, and (iv) no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that purpose
have been instituted or are pending or are, to the knowledge of such
officers, contemplated by the Commission.
(e) Accountant's Comfort Letter. At the time of the execution of this
Agreement, the Representatives shall have received letter(s) dated such
date from the Company's independent public accountants (other than ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ LLP) for the periods covered by their respective reports included
or incorporated by reference in
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the Registration Statement and the Prospectus (and the applicable interim
periods), in form and substance satisfactory to the Representatives
(substantially in the form of Exhibit B hereto), together with signed or
reproduced copies of such letters for each of the other Underwriters and
addressed to the Underwriters containing statements and information of the
type ordinarily included in accountants' "comfort letters" to underwriters
with respect to the financial statements and certain financial information
contained in the Registration Statement and the Prospectus.
(f) Bring-down Comfort Letter. At Closing Time, the Representatives
shall have received from the Company's independent public accountants
referred to in subsection (e) of this Section, letters dated as of Closing
Time, together with signed or reproduced copies of such letters for each of
the other Underwriters and addressed to the Underwriters, to the effect
that they reaffirm the statements made in the letter furnished pursuant to
subsection (e) of this Section, except that the specified date referred to
shall be a date not more than three business days prior to Closing Time.
(g) Maintenance of Rating. At Closing Time, the Securities shall be
rated by each of ▇▇▇▇▇'▇ Investors Service Inc. and Standard & Poor's
Ratings Services, a division of ▇▇▇▇▇▇-▇▇▇▇, Inc., as set forth in Schedule
B hereto. Since the date of this Agreement, there shall not have occurred a
downgrading in the rating assigned to the Securities or any of the
Company's other debt securities by any "nationally recognized statistical
rating agency," as that term is defined by the Commission for purposes of
Rule 436(g)(2) under the 1933 Act, and no such organization shall have
publicly announced that it has under surveillance or review, with possible
negative implications, its rating of the Securities or any of the Company's
other debt securities.
(h) Approval of Listing. At Closing Time, the Securities shall have
been approved for listing on any such exchange or exchanges as are listed
on Schedule B hereto, subject only to official notice of issuance.
(i) Additional Documents. At Closing Time counsel for the Underwriters
shall have been furnished with such documents and opinions as they
reasonably may require for the purpose of enabling them to pass upon the
issuance and sale of the Securities as herein contemplated, or in order to
evidence the accuracy of any of the representations or warranties, or the
fulfillment of any of the conditions, herein contained; and all proceedings
taken by the Company in connection with the issuance and sale of the
Securities as herein contemplated shall be satisfactory in form and
substance to the Representatives and counsel for the Underwriters.
(j) Termination of Agreement. If any condition specified in this
Section shall not have been fulfilled when and as required to be fulfilled,
this Agreement may be terminated by the Representatives by notice to the
Company at any time at or prior to Closing Time and such termination shall
be without liability of any party to any
-13-
other party except as provided in Section 4 and except that Sections 6 and
7 shall survive any such termination and remain in full force and effect.
(k) Chief Financial Officer's Certificate. At the time of the
execution of this Agreement and at Closing Time, the Representatives shall
have received a certificate of the chief financial officer, chief
accounting officer or treasurer of the Company substantially in the form of
Exhibit C hereto.
SECTION 6. Indemnification.
(a) Indemnification of Underwriters. The Company agrees to indemnify
and hold harmless each Underwriter and each person, if any, who controls any
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act as follows:
(i) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of any untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement
(or any amendment thereto), or the omission or alleged omission therefrom
of a material fact required to be stated therein or necessary to make the
statements therein not misleading or arising out of any untrue statement or
alleged untrue statement of a material fact included in any Preliminary
Prospectus or the Prospectus (or any amendment or supplement thereto), or
the omission or alleged omission therefrom of a material fact necessary in
order to make the statements therein, in the light of the circumstances
under which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission; provided that
(subject to Section 6(d) below) any such settlement is effected with the
written consent of the Company; and
(iii) against any and all expense whatsoever, as incurred (including
the reasonable fees and disbursements of counsel chosen by the
Representatives), reasonably incurred in investigating, preparing or
defending against any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, to the extent
that any such expense is not paid under (i) or (ii) above;
provided, however, that (i) this indemnity agreement shall not apply to any
loss, liability, claim, damage or expense to the extent arising out of any
untrue statement or omission or alleged untrue statement or omission made in
reliance upon and in conformity with written information furnished to the
Company by any Underwriter through the Representatives ex-
-14-
pressly for use in the Registration Statement (or any amendment thereto) or any
Preliminary Prospectus or the Prospectus (or any amendment or supplement
thereto) and (ii) such indemnity with respect to any Preliminary Prospectus or
the Prospectus shall not inure to the benefit of any Underwriter (or any person
controlling such Underwriter) from whom the person asserting any such loss,
liability, claim, damage or expense purchased the Securities which are the
subject thereof if such Underwriter did not send or deliver to such person a
copy of the Prospectus (or the Prospectus, as amended or supplemented) excluding
documents incorporated therein by reference at or prior to the confirmation of
the sale of the Securities to such person in any case where such delivery is
required by the 1933 Act and the untrue statement or omission of a material fact
contained in any Preliminary Prospectus or the Prospectus was corrected in the
Prospectus (or the Prospectus, as amended or supplemented). This indemnity
agreement will be in addition to any liability which the Company may otherwise
have.
(b) Indemnification of Company, Directors and Officers. Each
Underwriter severally and not jointly agrees to indemnify and hold harmless the
Company, its directors, each of its officers who signed the Registration
Statement, and each person, if any, who controls the Company within the meaning
of Section 15 of the 1933 Act or Section 20 of the 1934 Act against any and all
loss, liability, claim, damage and expense described in the indemnity contained
in subsection (a) of this Section, as incurred, but only with respect to untrue
statements or omissions, or alleged untrue statements or omissions, made in the
Registration Statement (or any amendment thereto) or any Preliminary Prospectus
or the Prospectus (or any amendment or supplement thereto) in reliance upon and
in conformity with written information furnished to the Company by such
Underwriter through the Representatives expressly for use in the Registration
Statement (or any amendment thereto) or such Preliminary Prospectus or the
Prospectus (or any amendment or supplement thereto).
(c) Actions Against Parties; Notification. Promptly after receipt by
an indemnified party under this Section 6 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 6, notify the indemnifying
party in writing of the commencement thereof; but the omission so to notify the
indemnifying party will not relieve it from any liability which it may have to
any indemnified party otherwise than under this Section 6. In case any such
action is brought against any indemnified party, and it notifies the
indemnifying party of the commencement thereof, the indemnifying party will be
entitled to participate therein, and to the extent that it may elect by written
notice delivered to the indemnified party promptly after receiving the aforesaid
notice from such indemnified party, to assume the defense thereof, with counsel
satisfactory to such indemnified party; provided, however, that if the
defendants (including impleaded parties) in any such action include both the
indemnified party and the indemnifying party and the indemnified party shall
have reasonably concluded that there may be legal defenses available to it or
other indemnified parties which are different from or additional to those
available to the indemnifying party, the indemnified party or parties shall have
the right to select separate counsel to assert such legal defenses and to
other-
-15-
wise participate in the defense of such action on behalf of such indemnified
party or parties. Upon receipt of notice from the indemnifying party to such
indemnified party of its election so to assume the defense of such action and
approval by the indemnified party of counsel, the indemnifying party will not be
liable to such indemnified party under this Section 6 for any legal or other
expenses subsequently incurred by such indemnified party in connection with the
defense thereof unless (i) the indemnified party shall have employed separate
counsel in connection with the assertion of legal defenses in accordance with
the proviso to the next preceding sentence (it being understood, however, that
the indemnifying party shall not be liable for the expenses of more than one
separate counsel (in addition to local counsel) representing the indemnified
parties), (ii) the indemnifying party shall not have employed counsel
satisfactory to the indemnified party to represent the indemnified party within
a reasonable time after notice of commencement of the action or (iii) the
indemnifying party has authorized the employment of counsel for the indemnified
party at the expense of the indemnifying party.
(d) Settlement Without Consent if Failure to Reimburse. If at any time
an indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, such indemnifying party
agrees that it shall be liable for any settlement of the nature contemplated by
Section 6(a)(ii) effected without its written consent if (i) such settlement is
entered into more than 45 days after receipt by such indemnifying party of the
aforesaid request, (ii) such indemnifying party shall have received notice of
the terms of such settlement at least 30 days prior to such settlement being
entered into and (iii) such indemnifying party shall not have reimbursed such
indemnified party in accordance with such request prior to the date of such
settlement.
SECTION 7. Contribution. If the indemnification provided for in
Section 6 hereof is for any reason unavailable to or insufficient to hold
harmless an indemnified party in respect of any losses, liabilities, claims,
damages or expenses referred to therein, then each indemnifying party shall
contribute to the aggregate amount of such losses, liabilities, claims, damages
and expenses incurred by such indemnified party, as incurred, (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company on the one hand and the Underwriters on the other hand from the offering
of the Securities pursuant to this Agreement or (ii) if the allocation provided
by clause (i) is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Company on the one hand and of the
Underwriters on the other hand in connection with the statements or omissions
which resulted in such losses, liabilities, claims, damages or expenses, as well
as any other relevant equitable considerations.
The relative benefits received by the Company on the one hand and the
Underwriters on the other hand in connection with the offering of the Securities
pursuant to this Agreement shall be deemed to be in the same respective
proportions as the total net proceeds from the offering of the Securities
pursuant to this Agreement (before deducting expenses)
-16-
received by the Company and the total underwriting discount received by the
Underwriters, in each case as set forth on the cover of the Prospectus, bear to
the aggregate initial public offering price of the Securities as set forth on
such cover.
The relative fault of the Company on the one hand and the Underwriters
on the other hand shall be determined by reference to, among other things,
whether any such untrue or alleged untrue statement of a material fact or
omission or alleged omission to state a material fact relates to information
supplied by the Company or by an Underwriter in writing through the
Representatives and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 7 were determined by pro rata
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to above in this Section 7. The aggregate
amount of losses, liabilities, claims, damages and expenses incurred by an
indemnified party and referred to above in this Section 7 shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, no Underwriter shall
be required to contribute any amount in excess of the amount by which the total
price at which the Securities underwritten by it and distributed to the public
were offered to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of any such untrue or
alleged untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the ▇▇▇▇ ▇▇▇) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls an
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act shall have the same rights to contribution as such Underwriter, and
each director of the Company, each officer of the Company who signed the
Registration Statement, and each person, if any, who controls the Company within
the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act shall
have the same rights to contribution as the Company. The Underwriters'
respective obligations to contribute pursuant to this Section 7 are several in
proportion to the principal amount of Securities set forth opposite their
respective names in Schedule A hereto and not joint.
-17-
SECTION 8. Representations, Warranties and Agreements to Survive
Delivery. All representations, warranties and agreements contained in this
Agreement or in certificates of officers of the Company or any of its
Subsidiaries submitted pursuant hereto shall remain operative and in full force
and effect, regardless of any investigation made by or on behalf of any
Underwriter or controlling person, or by or on behalf of the Company, and shall
survive delivery of the Securities to the Underwriters.
SECTION 9. Termination of Agreement.
(a) Termination; General. The Representatives may terminate this
Agreement, by notice to the Company, at any time at or prior to Closing Time (i)
if there has been, since the time of execution of this Agreement or since the
respective dates as of which information is given in the Prospectus, any
Material Adverse Change, or (ii) if there has occurred any material adverse
change in the financial markets in the United States or the international
financial markets, any outbreak of hostilities or escalation thereof or other
calamity or crisis (including any terrorist activity), the effect of which is
such as to make it, in the judgment of the Representatives, impracticable to
market the Securities or to enforce contracts for the sale of the Securities, or
(iii) if trading in any securities of the Company has been suspended or
materially limited by the Commission or the New York Stock Exchange, or if
trading generally on the American Stock Exchange or the New York Stock Exchange
or in the Nasdaq National Market has been suspended or materially limited (other
than to provide for an orderly market), or minimum or maximum prices for trading
have been fixed, or maximum ranges for prices have been required, by any of said
exchanges or by such system or by order of the Commission, the National
Association of Securities Dealers, Inc. or any other governmental authority, or
(iv) if a banking moratorium has been declared by either Federal or New York
authorities or a material disruption in commercial banking or securities
settlement or clearance services shall have occurred.
(b) Liabilities. If this Agreement is terminated pursuant to this
Section, such termination shall be without liability of any party to any other
party except as provided in Section 4 hereof, and provided further that Sections
6 and 7 shall survive such termination and remain in full force and effect.
SECTION 10. Default by One or More of the Underwriters. If one or more
of the Underwriters shall fail at Closing Time to purchase the Securities which
it or they are obligated to purchase under this Agreement (the "Defaulted
Securities"), the Representatives shall have the right, within 24 hours
thereafter, to make arrangements for one or more of the non-defaulting
Underwriters, or any other underwriters reasonably acceptable to the Company, to
purchase all, but not less than all, of the Defaulted Securities in such
principal amounts as may be agreed upon and upon the terms herein set forth; if,
however, the Representatives shall not have completed such arrangements within
such 24-hour period, then:
-18-
(a) if the aggregate principal amount of the Defaulted Securities does
not exceed 10% of the aggregate principal amount of the Securities to be
purchased on such date, each of the non-defaulting Underwriters shall be
obligated, severally and not jointly, to purchase the full amount thereof
in the proportion that its respective underwriting obligation hereunder
bears to the underwriting obligations of all non-defaulting Underwriters,
or
(b) if the aggregate principal amount of the Defaulted Securities
exceeds 10% of the aggregate principal amount of the Securities to be
purchased on such date, this Agreement shall terminate without liability on
the part of any non-defaulting Underwriter.
No action taken pursuant to this Section shall relieve any defaulting
Underwriter from liability in respect of its default.
In the event of any such default which does not result in a
termination of this Agreement either (i) the Representatives or (ii) the Company
shall have the right to postpone Closing Time for a period not exceeding seven
days in order to effect any required changes in the Registration Statement or
Prospectus or in any other documents or arrangements. As used in this Agreement,
the term "Underwriter" includes any person substituted for an Underwriter under
this Section 10.
SECTION 11. Notices. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the
Underwriters shall be directed to the Representatives at the address set forth
in Schedule B; notices to the Company shall be directed to it at ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇. ▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, attention of
Treasurer.
SECTION 12. Parties. This Agreement shall each inure to the benefit of
and be binding upon the Underwriters, the Company and their respective
successors. Nothing expressed or mentioned in this Agreement is intended or
shall be construed to give any person, firm or corporation, other than the
Underwriters, the Company and their respective successors and the controlling
persons and officers and directors referred to in Sections 6 and 7 and their
heirs and legal representatives, any legal or equitable right, remedy or claim
under or in respect of this Agreement or any provision herein contained. This
Agreement and all conditions and provisions hereof are intended to be for the
sole and exclusive benefit of the Underwriters, the Company and their respective
successors, and said controlling persons and officers and directors and their
heirs and legal representatives, and for the benefit of no other person, firm or
corporation. No purchaser of Securities from any Underwriter shall be deemed to
be a successor by reason merely of such purchase.
-19-
SECTION 13. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. EXCEPT AS
OTHERWISE SET FORTH HEREIN, SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY TIME.
SECTION 14. Effect of Headings. The Section headings herein are for
convenience only and shall not affect the construction hereof.
SECTION 15. Counterparts. This Agreement may be executed in one or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
S-1
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 between the
Company and the Underwriters.
Very truly yours,
WISCONSIN ENERGY CORPORATION
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇
------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇
Title: Treasurer
The foregoing Agreement is hereby con-
firmed and accepted as of the date specified
in Schedule ▇.
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ INC.
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
----------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Managing Director
For themselves and the other
Underwriters named in Schedule A
to the foregoing Agreement
SCHEDULE A
WISCONSIN ENERGY CORPORATION
Debt Securities
Aggregate Principal
Amount of 6.20%
Underwriter Senior Notes due 2033
------------------------------------------------ ---------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc........................ $128,000,000
BNP Paribas Securities Corp..................... $ 36,000,000
▇▇ ▇▇▇▇▇ Securities Corporation................. $ 36,000,000
------------
Total........................................ $200,000,000
============
SCHEDULE B
WISCONSIN ENERGY CORPORATION
Debt Securities
Underwriting Agreement dated March 17, 2003
Registration Statement No(s). 333-69592
Title and Certain Terms of Securities:
Title: 6.20% Senior Notes due April 1, 2033
Principal amount: $200,000,000
Maturity: April 1, 2033 (30 years)
Interest Rate: 6.20%
Interest Payment Dates: April 1 and October 1, commencing October 1,
2003
Sinking Fund: None
Redemption provisions: The Senior Notes will be redeemable as a whole
at any time, or in part from time to time, at the Company's option, at
a redemption price equal to the greater of (a) 100% of the principal
amount of the Senior Notes being redeemed or (b) the sum of the
present values of the remaining scheduled payments of principal and
interest thereon (exclusive of interest accrued to the date of
redemption) discounted to the redemption date on a semiannual basis
(assuming a 360-day year consisting of twelve 30-day months) at the
Treasury Rate (as defined in the Indenture) applicable to such series
plus 25 basis points, plus accrued interest to the redemption date.
Listing: None
Purchase Price: 98.582% of principal amount, plus accrued interest, if
any, from March 20, 2003.
Expected Reoffering Price: 99.457% of principal amount, plus any such
accrued interest, subject to change by the Representatives.
General
Rating: ▇▇▇▇▇'▇ Investors Service Inc.: A2, under review for possible
downgrade
Standard & Poor's Ratings Services: BBB+
Closing Date, Time and Location:
March 20, 2003 8:30 A.M. (Central time)
Offices of:
▇▇▇▇▇▇▇ & ▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Settlement and Trading: Book-Entry Only via the Depository Trust
Company ("DTC"). The Securities will trade in DTC's Same Day Funds
Settlement System.
Payment Method: Wire transfer of immediately available funds.
Notices: Notices to be given to the Underwriters should be directed to
the Representatives as follows:
Copies to:
▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ Kind
The respective principal amounts of the Securities to be purchased by each of
the Underwriters are set forth opposite their names in Schedule A hereto.
SCHEDULE C
WISCONSIN ENERGY CORPORATION
List of Significant Subsidiaries
Wisconsin Electric Power Company
WICOR, Inc.
WICOR Industries, Inc.
Wisconsin Gas Company
Exhibit A-1
FORM OF OPINION OF COMPANY'S COUNSEL
TO BE DELIVERED PURSUANT TO
SECTION 5(b)
Capitalized terms used herein shall have the same definitions as set
forth in the underwriting agreement (the "Underwriting Agreement") to which this
Exhibit A is attached.
(i) The Company has been duly incorporated and is validly existing
as a corporation in active status under the laws of the State of Wisconsin.
(ii) The Underwriting Agreement has been duly authorized, executed
and delivered by the Company.
(iii) The Indenture has been duly authorized, executed and delivered
by the Company, has been duly qualified under the 1939 Act and (assuming the due
authorization, execution and delivery thereof by the Trustee) constitutes a
valid and binding agreement of the Company, enforceable against the Company in
accordance with its terms, subject to the effects of bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other similar laws
relating to or affecting creditors' rights generally, general equitable
principles (whether considered in a proceeding in equity or at law) and an
implied covenant of good faith and fair dealing.
(iv) The Securities are in the form contemplated by the Indenture,
have been duly authorized by the Company and, assuming that the Securities have
been duly authenticated by the Trustee in the manner described in its
certificate delivered to you today (which fact such counsel need not determine
by an inspection of the Securities), the Securities have been duly executed,
issued and delivered by the Company and constitute valid and binding obligations
of the Company, enforceable against the Company in accordance with their terms,
subject to the effects of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or affecting
creditors' rights generally, general equitable principles (whether considered in
a proceeding in equity or at law) and an implied covenant of good faith and fair
dealing, and are entitled to the benefits of the Indenture.
(v) The Securities and the Indenture conform as to legal matters in
all material respects to the descriptions thereof contained in the Prospectus.
(vi) The Registration Statement has been declared effective under the
1933 Act; any required filing of the Prospectus pursuant to Rule 424(b) has been
made in the manner and within the time period required by Rule 424(b); and, to
the best of our knowledge, no stop order suspending the effectiveness of the
Registration Statement has been issued under the 1933 Act and no proceedings for
that purpose have been instituted or are pending or threatened by the
Commission.
A-1-1
(vii) The Registration Statement, the Prospectus, excluding the
documents incorporated by reference therein, and each amendment or supplement to
the Registration Statement and Prospectus, excluding the documents incorporated
by reference therein, as of their respective effective or issue dates (other
than the financial statements, including any pro forma financial information and
supporting schedules included therein or omitted therefrom and the Form T-1, as
to which we express no opinion) appeared on their face to comply as to form in
all material respects with the requirements of the 1933 Act and the 1933 Act
Regulations and the 1939 Act.
(viii) The documents incorporated by reference in the Prospectus
(other than the financial statements and supporting schedules included therein
or omitted therefrom, as to which we express no opinion), when they became
effective or were filed with the Commission, as the case may be, appeared on
their face to comply as to form in all material respects with the requirements
of the 1933 Act or the 1934 Act, as applicable, and the rules and regulations of
the Commission thereunder.
(ix) To the best of our knowledge, no filing with, or authorization,
approval, consent, license, order, registration, qualification or decree of, any
court or governmental authority or agency, domestic or foreign (other than under
the 1933 Act and the 1933 Act Regulations and the 1939 Act, which have been
obtained or made, or as may be required under the securities or blue sky laws of
the various states, as to which we express no opinion) is necessary or required
in connection with the due authorization, execution and delivery of the
Underwriting Agreement or for the offering, issuance, sale or delivery of the
Securities.
(x) The Company is not an "investment company" or an entity
"controlled" by an "investment company," as such terms are defined in the 1940
Act.
We have participated in conferences with officers and other
representatives of the Company, representatives of the Underwriters and
representatives of the independent public accountants for the Company at which
conferences the contents of the Prospectus and the Registration Statement and
related matters were discussed. Given the limitations inherent in the role of
outside counsel and the character of determinations involved in the preparation
of a Registration Statement, we are not passing upon and do not assume any
responsibility for the accuracy, completeness or fairness of the statements
contained in the Registration Statement or the Prospectus and have made no
independent check or verification thereof (except as otherwise indicated above).
On the basis of the foregoing, no facts have come to our attention that lead us
to believe that the Registration Statement or any amendment thereto, at the time
such Registration Statement or any such amendment became effective, contained an
untrue statement of a material fact or omitted to state a material fact required
to be stated therein or necessary to make the statements therein not misleading
or that the Prospectus, as of its date or as of the date hereof, contained or
contains an untrue statement of a material fact or omitted or omits to state a
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading (it being
understood that we express no comment with respect to the Form T-1 or the
financial statements, including the notes thereto, or any other financial or
statistical data found in or derived from the internal
A-1-2
accounting and other records of the Company and its Subsidiaries set forth or
referred to in the Registration Statement or the Prospectus).
In rendering such opinion, such counsel may rely as to matters of fact
(but not as to legal conclusions), to the extent they deem proper, on
certificates of responsible officers of the Company and its Subsidiaries,
representatives of the Trustee and public officials. In giving such opinion such
counsel may rely, as to all matters governed by the laws of jurisdictions other
than the law of the State of Wisconsin and the federal law of the United States,
upon the opinions of counsel satisfactory to the Representatives. Such counsel
may rely on the opinion of ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq. as to the exempt status of the
Company under the 1935 Act. Such opinion shall not state that it is to be
governed or qualified by, or that it is otherwise subject to, any treatise,
written policy or other document relating to legal opinions, including, without
limitation, the Legal Opinion Accord of the ABA Section of Business Law (1991).
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
FORM OF OPINION OF COMPANY'S COUNSEL
TO BE DELIVERED PURSUANT TO
SECTION 5(b)
Capitalized terms used herein shall have the same definitions as set
forth in the underwriting agreement (the "Underwriting Agreement") to which this
Exhibit A is attached.
(i) The Company has been duly incorporated and is validly existing
as a corporation in active status under the laws of the State of Wisconsin.
(ii) The Company has corporate power and authority to own, lease and
operate its properties and to conduct its business as described in the
Prospectus and to enter into and perform its obligations under the Underwriting
Agreement.
(iii) Each Subsidiary set forth on Schedule C to the Underwriting
Agreement has been duly incorporated and is validly existing as a corporation or
limited liability company in good standing (or equivalent status) under the laws
of the jurisdiction of its incorporation or formation, and has corporate or
limited liability company power and authority to own, lease and operate its
properties and to conduct its business as described in the Prospectus; except as
otherwise disclosed in the Registration Statement, all of the issued and
outstanding capital stock or membership interests, as the case may be, of each
Subsidiary has been duly authorized and validly issued, and, in the case of
capital stock, is fully paid and non-assessable (except as otherwise provided in
Section 180.0622(2)(b) of the Wisconsin Business Corporation Law, as judicially
interpreted) and, to the best of my knowledge, except for the outstanding shares
of preferred stock of Wisconsin Electric Power Company or as otherwise set forth
on Schedule C, is owned by the Company, directly or through Subsidiaries, free
and clear of any security interest, mortgage, pledge, lien, encumbrance, claim
or equity; to the best of my knowledge, none of the outstanding shares of
capital stock or membership interests, as the case may be, of any Subsidiary was
issued in violation of the preemptive or similar rights of any securityholder of
such Subsidiary.
(iv) The Underwriting Agreement has been duly authorized, executed
and delivered by the Company.
(v) The Indenture has been duly authorized, executed and delivered
by the Company, has been duly qualified under the 1939 Act and (assuming the due
authorization, execution and delivery thereof by the Trustee) constitutes a
valid and binding agreement of the Company, enforceable against the Company in
accordance with its terms, subject to the effects of bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other similar laws
relating to or affecting creditors' rights generally, general equitable
principles (whether considered in a proceeding in equity or at law) and an
implied covenant of good faith and fair dealing.
A-2-1
(vi) The Securities are in the form contemplated by the Indenture,
have been duly authorized by the Company and, assuming that the Securities have
been duly authenticated by the Trustee in the manner described in its
certificate delivered to you today (which fact such counsel need not determine
by an inspection of the Securities), the Securities have been duly executed,
issued and delivered by the Company and constitute valid and binding obligations
of the Company, enforceable against the Company in accordance with their terms,
subject to the effects of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or affecting
creditors' rights generally, general equitable principles (whether considered in
a proceeding in equity or at law) and an implied covenant of good faith and fair
dealing, and are entitled to the benefits of the Indenture.
(vii) The Securities and the Indenture conform as to legal matters in
all material respects to the descriptions thereof contained in the Prospectus.
(viii) The Registration Statement has been declared effective under
the 1933 Act; any required filing of the Prospectus pursuant to Rule 424(b) has
been made in the manner and within the time period required by Rule 424(b); and,
to the best of my knowledge, no stop order suspending the effectiveness of the
Registration Statement has been issued under the 1933 Act and no proceedings for
that purpose have been instituted or are pending or threatened by the
Commission.
(ix) The Registration Statement, the Prospectus, excluding the
documents incorporated by reference therein, and each amendment or supplement to
the Registration Statement and Prospectus, excluding the documents incorporated
by reference therein, as of their respective effective or issue dates (other
than the financial statements, including any pro forma financial information and
supporting schedules included therein or omitted therefrom and the Form T-1, as
to which I express no opinion) appeared on their face to comply as to form in
all material respects with the requirements of the 1933 Act and the 1933 Act
Regulations and the ▇▇▇▇ ▇▇▇.
(x) The documents incorporated by reference in the Prospectus
(other than the financial statements and supporting schedules included therein
or omitted therefrom, as to which I express no opinion), when they became
effective or were filed with the Commission, as the case may be, appeared on
their face to comply as to form in all material respects with the requirements
of the 1933 Act or the 1934 Act, as applicable, and the rules and regulations of
the Commission thereunder.
(xi) To the best of my knowledge, there are no statutes or
regulations that are required to be described in the Prospectus that are not
described as required.
(xii) All descriptions in the Registration Statement of written
contracts and other documents to which the Company or its Subsidiaries are a
party are accurate in all material respects; to the best of my knowledge, there
are no franchises, contracts, indentures, mortgages, loan agreements, notes,
leases or other instruments required to be described or referred to in the
Registration Statement or to be filed as exhibits thereto other than those
de-
A-2-2
scribed or referred to therein or filed or incorporated by reference as exhibits
thereto, and the descriptions thereof or references thereto are correct in all
material respects.
(xiii) To the best of my knowledge, neither the Company nor any
Subsidiary is in violation of its charter or by-laws and no default by the
Company or any Subsidiary exists in the due performance or observance of any
material obligation, agreement, covenant or condition contained in any contract,
indenture, mortgage, loan agreement, note, lease or other agreement or
instrument that is described or referred to in the Registration Statement or the
Prospectus or filed or incorporated by reference as an exhibit to the
Registration Statement.
(xiv) To the best of my knowledge, no filing with, or authorization,
approval, consent, license, order, registration, qualification or decree of, any
court or governmental authority or agency, domestic or foreign (other than under
the 1933 Act and the 1933 Act Regulations and the 1939 Act, which have been
obtained or made, or as may be required under the securities or blue sky laws of
the various states, as to which we express no opinion) is necessary or required
in connection with the due authorization, execution and delivery of the
Underwriting Agreement or for the offering, issuance, sale or delivery of the
Securities.
(xv) The execution, delivery and performance of the Underwriting
Agreement, the Indenture and the Securities and the consummation of the
transactions contemplated in the Underwriting Agreement and in the Registration
Statement (including the issuance and sale of the Securities and the use of the
proceeds from the sale of the Securities as described in the Prospectus under
the caption "Use of Proceeds") and compliance by the Company with its
obligations under the Underwriting Agreement, the Indenture and the Securities
do not and will not, whether with or without the giving of notice or lapse of
time or both, conflict with or constitute a breach of, or default or similar
event under or result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Company or any Subsidiary
pursuant to any written contract, indenture, mortgage, deed of trust, loan or
credit agreement, note, lease or any other agreement or instrument, known to me,
to which the Company or any Subsidiary is a party or by which it or any of them
may be bound, or to which any of the property or assets of the Company or any
Subsidiary is subject (except for such conflicts, breaches, similar events or
defaults or liens, charges or encumbrances that would not have a Material
Adverse Effect), nor will such action result in any violation of the provisions
of the charter or by-laws of the Company or any Subsidiary, or any applicable
law, statute, rule, regulation, judgment, order, writ or decree, known to me, of
any government, government instrumentality or court, domestic or foreign, having
jurisdiction over the Company or any Subsidiary or any of their respective
properties, assets or operations.
(xvi) The Company is not an "investment company" or an entity
"controlled" by an "investment company," as such terms are defined in the ▇▇▇▇
▇▇▇.
(xvii) The Company is exempt from the provisions of the 1935 Act,
except Section 9(a)(2) thereof relating to the acquisition of securities of
other public utility companies.
A-2-3
I have participated in conferences with officers and other
representatives of the Company, representatives of the Underwriters and
representatives of the independent public accountants for the Company at which
conferences the contents of the Prospectus and the Registration Statement and
related matters were discussed. Given the character of determinations involved
in the preparation of a Registration Statement, I am not passing upon and do not
assume any responsibility for the accuracy, completeness or fairness of the
statements contained in the Registration Statement or the Prospectus and have
made no independent check or verification thereof (except as otherwise indicated
above). On the basis of the foregoing, no facts have come to my attention that
lead me to believe that the Registration Statement or any amendment thereto, at
the time such Registration Statement or any such amendment became effective,
contained an untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading or that the Prospectus, as of its date or as of the date hereof,
contained or contains an untrue statement of a material fact or omitted or omits
to state a material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not misleading (it
being understood that I express no comment with respect to the Form T-1 or the
financial statements, including the notes thereto, or any other financial or
statistical data found in or derived from the internal accounting and other
records of the Company and its Subsidiaries set forth or referred to in the
Registration Statement or the Prospectus).
In rendering such opinion, such counsel may rely as to matters of fact
(but not as to legal conclusions), to the extent such counsel deems proper, on
certificates of responsible officers of the Company and its Subsidiaries,
representatives of the Trustee and public officials. In giving such opinion such
counsel may rely, as to all matters governed by the laws of jurisdictions other
than the law of the State of Wisconsin and the federal law of the United States,
upon the opinions of counsel satisfactory to the Representatives. Such opinion
shall not state that it is to be governed or qualified by, or that it is
otherwise subject to, any treatise, written policy or other document relating to
legal opinions, including, without limitation, the Legal Opinion Accord of the
ABA Section of Business Law (1991).
A-2-4
Exhibit B
FORM OF ACCOUNTANTS' COMFORT LETTER PURSUANT TO SECTION 5(e)
1. We are independent certified public accountants with respect to the
Company within the meaning of the 1933 Act and the applicable published 1933 Act
Regulations.
2. In our opinion, the audited financial statements and the related
financial statement schedules included or incorporated by reference in the
Registration Statement and the Prospectus comply as to form in all material
respects with the applicable accounting requirements of the 1933 Act, the 1934
Act and the related rules and regulations thereunder.
3. For purposes of this letter we have read the minutes of meetings of
the stockholders, the board of directors, and other committees of the board of
directors of the Company as set forth in the minute books at __________, 200_,
and the unapproved minutes of the board of directors and other committees of the
board of directors as held on _________, 200_, officials of the Company having
advised us that the minutes of all such meetings through that date were set
forth therein; we have carried out other procedures to ________, 200_, as
follows (our work did not extend to the period from ________, 200_, to ________,
200_, inclusive):
(a) With respect to the ____ month periods ended ______, 200_ and
200_, we have:
(i) Performed the procedures specified by the American Institute
of Certified Public Accountants for a review of interim
financial information as described in SAS No. 71, Interim
Financial Information, on the unaudited consolidated
financial statements for these periods included in the
Company's quarterly report on Form 10-Q for the _____ months
ended ________, 200_, incorporated by reference in the
Registration Statement.
(ii) Inquired of certain officials of the Company who have
responsibility for financial and accounting matters whether
the unaudited consolidated financial statements referred to
in 3a(i) comply as to form in all material respects with the
applicable accounting requirements of the Securities
Exchange Act of 1934 as it applies to Form 10-Q and the
related published rules and regulations.
(b) With respect to the period from ______, 200_ to ______, 200_, we
have:
(i) Read the unaudited consolidated financial statements of the
Company for ________, 200_ furnished to us by the Company,
B-1
officials of the Company having advised us that no such
financial statements of any date or for any period
subsequent to ______, 200_, were available. [The financial
information for ________ is incomplete in that it omits the
statement of cash flows and note disclosures.]
(ii) Inquired of certain officials of the Company who have
responsibility for financial and accounting matters whether
the unaudited consolidated financial statements referred to
in 3b(i) arte stated on a basis substantially consistent
with that of the audited consolidated financial statements
incorporated by reference in the Registration Statement.
The foregoing procedures do not constitute an audit conducted in
accordance with generally accepted auditing standards. Also, they would not
necessarily reveal matters of significance with respect to the comments in the
following paragraph. Accordingly, we make no representations regarding the
sufficiency of the foregoing procedures for your purposes.
4. Nothing came to our attention as a result of the foregoing
procedures, however, that caused us to believe that:
(a) (i) Any material modifications should be made to the unaudited
consolidated financial statements described in 3a incorporated by
reference in the Registration Statement, for them to be in
conformity with generally accepted accounting principles.
(ii) The unaudited consolidated financial statements described in
3a do not comply as to form in all material respects with the
applicable accounting requirements of the Securities Exchange Act
of 1934 as it applies to Form 10-Q and the related published
rules and regulations.
(b) At _____________, 200_, there was any change in the common stock,
increase in long-term debt or any decrease in net current assets
or common equity of the Company as compared with amounts shown in
the ________, 200_, [audited/unaudited] consolidated balance
sheet incorporated by reference in the Registration Statement, or
for the period from ________, 200_ to ________, 200_, there were
any decreases, as compared to the corresponding period in the
preceding year, in consolidated operating revenues or net income,
except in all instances for changes, increases, or decreases that
the Registration Statement discloses have occurred or may occur.
5. As mentioned in 3a, Company officials have advised us that no
consolidated financial statements as of any date or for any period subsequent to
______, 200_ are
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available; accordingly, the procedures carried out by us with respect to changes
in financial statement items after _______, 200_, have, of necessity, been even
more limited than those with respect to the periods referred to in 3. We have
inquired of certain officials of the Company who have responsibility for
financial and accounting matters whether (a) at _______, 200_, there was any
change in the common stock, increase in long-term debt or any decreases in
consolidated net current assets or common equity of the Company as compared with
amounts shown on the ______, 200_, [audited/unaudited] consolidated balance
sheet incorporated by reference in the Registration Statement or (b) for the
period from _____, 200_, to ________, 200_, there were any decreases, as
ompared with the corresponding period in the preceding year, in consolidated
operating revenues or net income. On the basis of these inquires and our reading
of the minutes as described in 3, nothing came to our attention that caused us
to believe that there was any such change, increase, or decrease, except in all
instances for changes, increases, or decreases that the Registration Statement
discloses have occurred or may occur.
[6. We are unable to and do not express any opinion on the Pro Forma
Combining Statement of Operations (the "Pro Forma Statement") included in the
Registration Statement or on the pro forma adjustments applied to the historical
amounts included in the Pro Forma Statement; however, for purposes of this
letter we have:
(A) read the Pro Forma Statement;
(B) performed a review in accordance with SAS No. 71 of the
financial statements to which the pro forma adjustments were applied;
(C) made inquiries of certain officials of the Company who have
responsibility for financial and accounting matters about the basis
for their determination of the pro forma adjustments and whether the
Pro Forma Statement complies as to form in all material respects with
the applicable accounting requirements of Rule 11-02 of Regulation
S-X; and
(D) proved the arithmetic accuracy of the application of the pro
forma adjustments to the historical amounts in the Pro Forma
Statement;
on the basis of such procedures and such other inquiries and procedures as
specified herein, nothing came to our attention that caused us to believe
that the Pro Forma Statement included in the Registration Statement does
not comply as to form in all material respects with the applicable
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 those statements.]
7. In addition to the procedures referred to in clause 3 above, we
have performed other procedures, not constituting an audit, with respect to
certain amounts, percentages, numerical data and financial information appearing
in the Registration Statement, which
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are specified herein, and have compared certain of such items with, and have
found such items to be in agreement with, the accounting and financial records
of the Company.
B-4
Exhibit C
CERTIFICATE OF CHIEF FINANCIAL OFFICER
I, ____________________________ of the Company, hereby certify that I
have read each of the items marked on the attached copy of the Prospectus,
dated _____________, ______ and the documents incorporated by reference therein
and have:
1. compared each such item with the corresponding amount, or
recomputed such item based upon amounts or percentages, included in the
Company's financial statements and notes thereto or in schedules or reports
derived from the accounting records of the Company for the applicable periods
and found them to be in agreement; and
2. verified the accuracy of such other amounts, percentages, numerical
data and financial information appearing in the Prospectus as may be reasonably
requested by the Representative and specifically enumerated in this certificate.
C-1