EXHIBIT 1.1
NIAGARA MOHAWK POWER CORPORATION
SENIOR DEBT SECURITIES UNDERWRITING AGREEMENT
New York, New York
May 9, 2000
To the Representative
named in Schedule I hereto
of the Underwriters named
in Schedule II hereto
Dear Ladies and Gentlemen:
Niagara Mohawk Power Corporation, a New York corporation (the "Company"),
proposes to sell to the underwriters named in Schedule II hereto (the
"Underwriters") for whom you are acting as the representative (the
"Representative"), its Senior Debt Securities of the designations, with the
terms, the initial public offering price, the purchase prices to the
Underwriters and in the aggregate principal amounts specified in Schedule I
hereto (the "Securities") to be issued under its Indenture from the Company to
The Bank of New York (the "Trustee"), as to be further supplemented and amended
by a supplemental indenture relating to the Securities (such Indenture as so
supplemented and amended and as to be so supplemented and amended being
hereinafter referred to as the "Indenture"), and Schedule I hereto sets forth
the date, time and manner of delivery of the Securities.
1. Representations and Warranties by the Company
---------------------------------------------
The Company represents and warrants to, and agrees with each Underwriter
that:
(a) The Company meets the requirements for use of Form S-3 under the
Securities Act of 1933, as amended (the "Act") and has filed with the
Securities and Exchange Commission (the "Commission") a registration
statement (with the file number set forth on Schedule I hereto) on such
Form, including a prospectus, for the registration under the Act of the
Securities, which registration statement has become effective. Such
registration statement and prospectus may have been amended or supplemented
from time to time prior to the date of this Agreement. Any such amendment
or supplement was or will be timely filed with the Commission and any such
amendment has become effective. The Company will file with the Commission a
prospectus supplement (the "Prospectus Supplement") relating to the
Securities pursuant to Rule 424 under the Act. Copies of such registration
statement and prospectus, any such amendment or supplement, the Prospectus
Supplement and all documents incorporated by reference therein which were
filed with the Commission on or prior to the date of this Agreement have
been delivered to you. Such registration statement and such prospectus or
any prospectus used in place thereof pursuant to Rule 429 under the Act,
as amended or supplemented prior to the date of this Agreement and as
supplemented by the Prospectus Supplement, are hereinafter called the
"Registration Statement," and the "Prospectus," respectively. Any reference
herein to the Registration Statement 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 (the "Exchange Act") on or before the date of this
Agreement, and any reference herein to the terms "amend," "amendment" or
"supplement" with respect to the Registration Statement or the Prospectus
shall be deemed to refer to and include the filing of any document under the
Exchange Act deemed to be incorporated by reference therein after the date
of this Agreement.
(b) (i) The Registration Statement, at the time it became effective, any
post-effective amendment thereto, at the time it became effective, the
Prospectus, at the date of this Agreement and at the Closing Date (as
hereinafter defined), any amendments thereof and supplements thereto and
the Indenture complied or will comply in all material respects with the Act,
the Trust Indenture Act of 1939 (the "Trust Indenture Act") and the Exchange
Act and the respective rules thereunder and (ii) neither the Registration
Statement nor the Prospectus nor any amendment thereof or supplement thereto
contained or will contain any untrue statement of a material fact or omitted
or will omit to state any material fact required to be stated therein or
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided, however,
that the Company makes no representations or warranties as to (A) that part
of the Registration Statement which shall constitute the Statement of
Eligibility (Form T-1) under the Trust Indenture Act of the Trustee or
(B) 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 expressly for
use in the Prospectus as amended or supplemented.
(c) The documents incorporated by reference in the Prospectus, when they were
filed with the Commission or became effective, conformed in all material
respects to the requirements of the Act or the Exchange Act and the rules
and regulations of the Commission thereunder, and any documents so filed and
incorporated by reference subsequent to the date of this Agreement will,
when they are filed with the Commission, conform in all material respects to
the requirements of the Act and the Exchange Act, and the rules and
regulations of the Commission thereunder, and none of such documents include
or will include any untrue statement of a material fact or omit or will omit
to state any material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances under which
they were made, not misleading; provided, however, that such representation
shall not apply to any statements or omissions made in reliance upon and in
conformity with information furnished by an Underwriter through the
representatives expressly for use in the Prospectus as supplemented or
amended.
(d) The accountants who have certified or shall certify the audited financial
statements incorporated by reference as parts of the Registration Statement
and the Prospectus are independent accountants as required by the Act and
the rules and regulations of the Commission thereunder.
(e) The financial statements and information included or incorporated by
reference in the Registration Statement present fairly, in all material
respects, the financial position, results of operations and changes in
financial position of the Company at the respective dates and for the
respective periods indicated, all in conformity with generally accepted
accounting principles applied on a consistent basis throughout the periods
involved except as therein stated. The Company has no material contingent
obligation which is not disclosed in the Registration Statement and
Prospectus.
(f) Subsequent to the respective dates as of which information is given in
the Registration Statement and the Prospectus, except as set forth in the
Registration Statement and the Prospectus, there has not been any material
adverse change in the condition (financial or other), earnings, business or
properties of the Company, whether or not arising from transactions in the
ordinary course of business.
(g) All the outstanding shares of capital stock of the Company have been duly
authorized and validly issued and are fully paid and non-assessable.
(h) The Securities have been duly authorized, and, when are issued and
delivered pursuant to this Agreement, such securities will have been duly
executed, authenticated, issued and delivered in accordance with the
Indenture and sold to the Underwriters as provided herein, will constitute
valid and legally binding obligations of the Company entitled to the
benefits of the Indenture.
(i) The Securities conform, in all material respects, as to legal matters to
the description thereof in the Prospectus.
(j) The Company has been duly incorporated and validly existing corporation
in good standing under the laws of the State of New York; the Company holds
all material licenses, certificates and permits from governmental
authorities necessary for the conduct of its business; and the Company has
the corporate power and authority to own its properties and conduct its
business as described in the Prospectus.
(k) Neither the Company nor any of its subsidiaries is in violation of its
respective charter or by-laws or in default in the performance of any
obligation, agreement, covenant or condition contained in any indenture,
loan agreement, mortgage, lease or other agreement or instrument that is
material to the Company and its subsidiaries, taken as a whole, to which
the Company or any of its subsidiaries is a party or by which the Company
or any of its subsidiaries or their respective property is bound, except
for such violation which, singly or in the aggregate, would not have a
material adverse effect on the business, properties, financial condition
or results of operation of the Company and its subsidiaries taken as a
whole.
(l) The Indenture has been duly qualified under the Trust Indenture Act, the
Company duly authorized the Indenture and, when the Company has duly
executed and delivered the Indenture (assuming the due authorization,
execution and delivery thereof by the Trustee) will be a valid and binding
agreement of the Company, enforceable against it in accordance with its
terms, except as the enforceability thereof may be limited (i) by the
effect of bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium or other similar laws now or hereafter in effect relating to
or affecting the rights and remedies of creditors and (ii) by the effect
of general principles of equity, whether enforcement is considered in a
proceeding in equity or at law, and the discretion of the court before which
any proceedings may be brought.
(m) Neither the issuance or sale of the Securities, nor the consummation of
any other of the transactions herein contemplated, nor the fulfillment of
the terms hereof, will conflict with, result in a breach of or constitute a
default under the terms of any indenture, or other agreement or instrument
to which the Company is a party or by which it is bound or, to the best
knowledge of the Company, any order or regulation applicable to the Company
of any court, regulatory body, administrative agency or governmental body
having jurisdiction over the Company.
(n) The Company has filed a petition with the Public Service Commission of
the State of New York ("PSC") with respect to the issue and sale of the
Securities. The PSC has authorized or is expected to authorize the issue
and sale thereof on or prior to the Closing Date but upon the express
condition that the Company shall file with the PSC for its consideration a
copy of this Agreement and a statement setting forth (i) the interest rate
for the Securities, (ii) any initial public offering price thereof, (iii)
the price to be paid to the Company for the Securities, (iv) any
underwriting commissions, (v) any sinking fund or other mandatory
redemption provisions, and (vi) any redemption prices and dates with respect
to redemption of the Securities at the option of the Company.
(o) The Company and each material subsidiary of the Company have good and
valid title to all or substantially all of their permanent fixed properties
(including the specified undivided interests in generating units and plants
referred to in the Prospectus), except as otherwise indicated in the
Prospectus, subject only to the respective liens of the indentures securing
its mortgage debt.
(p) The Agreement has been duly authorized and validly executed by the
Company.
(q) Except as disclosed in the Prospectus and subject to such qualifications
as may be set forth therein, neither the Company nor any of its subsidiaries
has violated any foreign, federal, state or local law or regulation relating
to the protection of human health and safety, the environment or hazardous
or toxic substances or wastes, pollutants or contaminants ("Environmental
Laws"), any provisions of the Employee Retirement Income Security Act of
1974, as amended, or any provisions of the Foreign Corrupt Practices Act or
the rules and regulations promulgated thereunder, except for such violation
which, singly or in the aggregate, would not have a material adverse effect
on the business, properties, financial condition or results of operation of
the Company and its subsidiaries taken as a whole.
(r) Except as disclosed in the Prospectus and subject to such qualifications
as may be set forth therein, there are no costs or liabilities associated
with Environmental Laws (including, without limitation, any capital or
operating expenditures required for clean-up, closure of properties or
compliance with Environmental Laws or any Authorization, any related
constrains on operating activities and any potential liabilities to third
parties) which would singly or in the aggregate, have a material adverse
effect on the business, properties, financial condition or results of
operation of the Company and its subsidiaries taken as a whole.
2. Purchase and Sale
-----------------
Subject to the terms and conditions and in reliance upon the representations
and warranties herein set forth, the Company agrees to sell to you and each
other Underwriter, and you and each other Underwriter agree, severally and
not jointly, to purchase from the Company, at the purchase price set forth
in Schedule I hereto, the respective principal amounts of the Securities set
forth opposite your respective names in Schedule I hereto and Schedule II
hereto and Schedule I hereto sets forth the date, time and manner of
delivery of the Securities.
Upon authorization by the Representative of the release of the Securities,
the several Underwriters propose to offer the Securities for sale upon the
terms and conditions set forth in the Prospectus.
3. Delivery and Payment
--------------------
Delivery of and payment for the Securities shall be made at the place, date
and time specified in Schedule I hereto. The Securities shall be in
definitive form and shall be registered in such names and in such authorized
denominations as the Representative may request not less than forty-eight
hours in advance of the Closing Date, and shall be delivered by or on behalf
of the Company to the Representative for the account of such underwriter,
against payment by such underwriter or on its behalf of the purchase price
therefor by wire transfer of federal (same day) funds to the account
specified by the Company to the Representative at least forty-eight hours
in advance of the Closing Date.
4. Agreements
----------
The Company agrees with each of the several Underwriters that:
(a) The Company will cause the Prospectus Supplement to be filed or mailed
for filing, in a form approved by the Representative, pursuant to Rule 424
under the Act and will notify you promptly of such filing or mailing.
During the period for which a prospectus relating to the Securities is
required to be delivered under the Act, the Company will promptly advise
the Representative (i) when any amendment to the Registration Statement
shall have become effective, (ii) when any subsequent supplement to the
Prospectus has been filed or mailed for filing, (iii) of any request by
the Commission for any amendment of or supplement to the Registration
Statement or the Prospectus or for any additional information, (iv) of
the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or the institution or
threatening of any proceedings for that purpose, and (v) of the receipt
by the Company of any notification with respect to the suspension of the
qualification of the Securities for sale in any jurisdiction or the
initiation or threatening of any proceeding for such purpose. The Company
will not file any amendment to the Registration Statement or supplement
to the Prospectus (other than any prospectus supplement relating to the
offering of securities registered under the Registration Statement other
than the Securities and permitted by Section 4(g) hereof, or any document
required to be filed under the Exchange Act which upon filing is deemed
to be incorporated by reference in the Registration Statement or Prospectus)
unless the Company has furnished to you a copy for your review prior to
filing and will not file any such proposed amendment or supplement to which
you reasonably object after receiving a reasonable notice from the
Representative thereof. The Company will furnish to you prior to the
filing thereof a copy of any such prospectus supplement and any document
which upon filing is deemed to be incorporated by reference in the
Registration Statement or Prospectus. The Company will use its best efforts
to prevent the issuance of any such stop order and, if issued, to obtain as
soon as possible the withdrawal thereof.
(b) If, at any time when a prospectus relating to the Securities is required
to be delivered under the Act, any event occurs as a result of which the
Prospectus as then amended or supplemented would include 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 at any time to
amend or supplement the Prospectus to comply with the Act or the Exchange
Act or the respective rules thereunder, the Company promptly will prepare
and file with the Commission, subject to paragraph (a) of this Section 4,
an amendment or supplement which will correct such statement or omission or
an amendment or supplement which will effect such compliance.
(c) The Company will make generally available to its security holders and to
the Representative as soon as practicable, but in any event not later than
eighteen months after the effective date of the Registration Statement (as
defined in Rule 158(c) under the Act), an earnings statement (which need not
be audited) of the Company, for a twelve-month period beginning after the
date of the Prospectus Supplement filed pursuant to Rule 424 under the Act,
which will satisfy the provisions of Section 11(a) of the Act.
(d) The Company has previously furnished to the Representative, upon
request, a signed copy of the Registration Statement as originally filed and
of each amendment thereto, including the statement on Form T-1 of the
Trustee and all powers of attorney, consents and exhibits filed therewith
(other than exhibits incorporated by reference), and will deliver to the
Representative conformed copies of the Registration Statement, the
Prospectus (including all documents incorporated by reference therein) and,
so long as delivery of a prospectus by an Underwriter or dealer may be
required by the Act, all amendments of and supplements to such documents, in
each case as soon as available and in such quantities as the Representative
may reasonably request.
(e) The Company will furnish such information, execute such instruments and
take such action as may be required to qualify the Securities for sale under
the laws of such jurisdictions as the Representative may designate and will
maintain such qualifications in effect so long as required for the
distribution of the Securities; provided, however, that the Company shall
not be required to qualify to do business in any jurisdiction where it is
not now so qualified or to take any action which would subject it to
general or unlimited service of process in any jurisdiction where it is not
now so subject.
(f) So long as the Securities are outstanding, the Company will furnish (or
cause to be furnished) to the Representative, upon request, copies of (i)
all reports to stockholders of the Company and (ii) all reports and
financial statements filed with the Commission or any national securities
exchange.
(g) During the period beginning from the date of this Agreement and
continuing to and including the earlier of (i) the termination of trading
restrictions on the Securities, as notified to the Company by the
Representative, or (ii) the thirtieth day after the Closing Date for the
Securities, not to offer, sell, or otherwise dispose of any debt securities
of the Company (except under prior contractual commitments which have been
disclosed to you), without the prior written consent of the Representative,
which consent shall not be unreasonably withheld.
5. Expenses
--------
Whether or not the transactions contemplated hereunder are consummated or
this Agreement is terminated, the Company will pay all costs and expenses
incident to the performance of the obligations of the Company hereunder,
including, without limiting the generality of the foregoing, all costs,
taxes and expenses incident to the issue and delivery of the Securities to
the Underwriters, all fees and expenses of the Company's counsel and
accountants, all costs and expenses incident to the preparing, printing and
filing of the Registration Statement (including all exhibits thereto), the
Prospectus and any amendments thereof or supplements thereto, all costs and
expenses incurred in connection with "blue sky" qualifications, the legality
of the Securities for investment and the rating of the Securities, and all
costs and expenses of the printing and distribution of all documents in
connection with this underwriting. Except as provided in this Section 5 and
Section 8 hereof, the Underwriters will pay all their own costs and
expenses, including the fees of their counsel and any advertising expenses
in connection with any offer they may make.
6. Conditions to the Obligations of the Underwriters
-------------------------------------------------
The obligations of the Underwriters to purchase the Securities shall be
subject to the accuracy in all material respects of the representations and
warranties on the part of the Company contained herein as of the date
hereof and the Closing Date, to the accuracy of the statements of Company
officers made in any certificates given pursuant to the provisions hereof,
to the performance by the Company of its obligations hereunder and to the
following additional conditions:
(a) No stop order suspending the effectiveness of the Registration Statement
shall have been issued and no proceedings for that purpose shall have been
instituted or, to the knowledge of the Company or the Representative,
threatened.
(b) On the date hereof through the Closing Date (i) there shall not have
been any decrease in the rating of the Company's debt securities by any
"nationally recognized statistical rating organization" (as defined for the
purposes of Rule 436(g) under the Act) and (ii) no such organization shall
have officially communicated to the Company that it has under surveillance
or review, with possible negative implications, its rating of any of the
Company's debt securities.
(c) The Company shall furnish to the Representative opinions, addressed to
the Underwriters and dated the Closing Date, of the Company's General
Counsel to the effect that (i) the Company has all requisite corporate
power and authority to own or lease and operate its properties and to
carry on its own business as now conducted; (ii) To such counsel's
knowledge, no consent, waiver, approval, authorization or order of, or
filing, registration, qualification license or permit of or with, any
Federal or New York State court or governmental agency, body or
administrative agency is required for the execution, delivery and
performance by the Company of the Underwriting Agreement and the Indenture,
the issuance and sale of the Securities, and the consummation of the
transactions contemplated thereby, except (a) such as have been obtained
and made under the Securities Act and the Trust Indenture Act and from the
PSC under a Financing Order granting consent to the Company's issuance and
sale of the Securities, subject to the conditions contained in that Order,
or have been obtained as described in the Prospectus, (b) such as are
required under state securities of Blue Sky laws and regulations, and
(c) such as to which the failure to be obtained or made would not reasonably
be expected, either individually or in the aggregate, to have a material
adverse effect on the business, financial condition or results of
operations of the Company and its subsidiaries, taken as a whole; provided,
that insofar as performance by the Company of its obligations under the
Underwriting Agreement, the Indenture and the Securities is concerned,
such counsel expresses no opinion except for those matters specifically
set forth in (ii)(a), (iv) and (v), as to bankruptcy, insolvency,
reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors' rights; provided further that such
counsel express no opinion as to any laws, rules, regulations applicable
to the Company in its capacity as an electric and gas utility and as an
operator, owner, or operator and owner of nuclear powered generating
facilities, including the New York Public Service Law, the Federal Power
Act, the Public Utility Holding Company Act of 1935 (the "Holding Company
Act"), as amended, the Atomic Energy Act of 1954 (the "AEA") and the rules
and regulations of the PSC and, solely with respect to jurisdiction
granted by the Holding Company Act, the Commission, and the Nuclear
Regulatory Commission (the "NRC"); (iii) To such counsel's knowledge,
there is no action, suit, investigation, litigation or proceeding
affecting the Company or any of its subsidiaries pending or threatened
before any court, governmental authority, governmental agency, regulatory
body or arbitrator that would be reasonably likely to have a material
adverse effect; (iv) To such counsel's knowledge and based upon the
Financing Order, the Company does not require authorization from the
Federal Energy Regulatory Commission to issue and sell the Securities as
provided for in the Underwriting Agreement and the Indenture; and (v)
To such counsel's knowledge the Company's execution of the Underwriting
Agreement and the Indenture and the issuance and sale of the Securities
would neither contravene the AEA nor the regulations of the NRC in 10
Code of Federal Regulations, Chapter I, nor would such actions require
any application for approval by the NRC.
(d) The Company shall furnish to the Representative opinions, addressed to
the Underwriters and dated the Closing Date, of ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, counsel
for the Company, to the effect that (i) the Company has been duly
incorporated and is existing corporation in good standing under the laws of
the State of New York, with full corporate power and authority to own its
properties and conduct its business as described in the Prospectus; (ii)
the Indenture has been duly authorized executed and delivered by the Company
and, assuming due authorization, execution and delivery thereof by the
Trustee, constitutes a valid, binding and enforceable instrument, except as
may be limited by bankruptcy, insolvency, reorganization, moratorium or
other similar laws relating to or affecting creditors' rights generally from
time to time in effect and general principles of equity and except that
certain laws and judicial decisions of the United States and the State of
New York may limit the remedies provided for in the Indenture in connection
with the security provided for therein and, as to nuclear facilities, such
remedies may also be limited or rendered unavailable by the AEA, as amended,
and regulations thereunder; (iii) the Securities have been duly authorized,
executed and issued by the Company and, assuming due authentication thereof
by the Trustee, and upon payment and delivery in accordance with this
Agreement, and subject to the qualification in (ii) above with respect to
the validity, binding effect and enforceability of the Indenture, will
constitute valid and binding obligations of the Company entitled to the
benefit and the security afforded by the Indenture; (iv) all regulatory
consents, authorizations, approvals and filings required to be made or
obtained by the Company under the Federal laws of the United States and the
laws of the State of New York for the issuance, sale and delivery of the
Securities by the Company in accordance with this Agreement have been
obtained or made (other than any such regulatory consents, authorizations,
approvals or filings arising out of, relating to, or required to be taken
pursuant to, those regulatory regimes that govern the Company in its
capacity as an electric and gas utility and as an operator, owner, or
operator and owner of nuclear powered generating facilities, including the
New York Public Service Law, the Federal Power Act, the Holding Company Act,
the AEA and the rules and regulations of the PSC, and, solely with respect
to jurisdiction granted by the Holding Company Act, the Securities and
Exchange Commission, and the NRC ("Utility Related Approvals") or any blue
sky or state securities laws or regulations, as to which such counsel need
express no opinion); (v) the Indenture is qualified under the Trust
Indenture Act; (vii) this Agreement has been duly authorized, executed and
delivered by the Company; (viii) the Registration Statement, as of its
effective date and the Prospectus, as of the date of the Prospectus, appear
on their face to be appropriately responsive in all material respects to
the requirements of the Act, the Exchange Act and the Trust Indenture Act
and the rules and regulations of the Commission thereunder; (ix) such
counsel have no reason to believe that either the Registration Statement,
as of its effective date, contained any untrue statement of a material
fact or omitted to state a material fact necessary to make the statements
therein not misleading or that the Prospectus, as of the date of the
Prospectus, contained or on the Closing Date contains an untrue statement
of a material fact or on the Closing Date omits to state a material fact
necessary to make the statements therein, in the light of the circumstance
under which they were made, not misleading (except for financial statements
and other financial data included or incorporated by reference therein as
to which such counsel need express no opinion); and (x) neither the issue
or sale of the Securities nor the consummation of any other of the
transactions contemplated by this Agreement will result in a breach by the
Company of any terms of, or constitute a default under, the Certificate of
Incorporation, as amended, or By-Laws of the Company or any indenture or
other agreement or undertaking of the Company known to such counsel.
(e) The Representative shall receive from counsel for the Underwriters such
opinion or opinions dated the Closing Date with respect to the validity of
the Securities, the Registration Statement, the Prospectus and other
related matters as the Representative may reasonably require, and the
Company shall have furnished to such counsel such documents as they
reasonably request for the purpose of enabling them to pass upon such
matters.
(f) The Company shall furnish to the Representative a certificate of a Vice
President, the Treasurer or the Controller of the Company and a Vice
President, the Assistant Controller or the Assistant Treasurer of the
Company, dated the Closing Date, to the effect that the signers of such
certificate have carefully examined the Registration Statement, the
Prospectus and this Agreement and that:
(i) the representations and warranties of the Company in this Agreement
are true and correct on and as of the Closing Date with the same
effect as if made on the Closing Date, and the Company 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;
(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 their knowledge, threatened; and
(iii) the Registration Statement, as of the later of the date it became
effective or the date of filing of the Company's most recent Annual
Report on Form 10-K, does not contain any untrue statement of a
material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading; the
Prospectus, including any supplements or amendments thereto and the
documents incorporated by reference therein, does not contain any
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made,
not misleading; and since the effective date of the Registration
Statement there has not occurred any event required to be set forth
in an amended or supplemented prospectus which has not been so set
forth and there has been no document required to be filed under the
Exchange Act and the rules and regulations thereunder, which would
be deemed to be incorporated by reference in the Prospectus, which
has not been so filed.
(g) The Representative (i) shall have received at or prior to the time of
execution of this Agreement a letter to the Board of Directors of the
Company and the Underwriters dated the date of such delivery and (ii) shall
receive at the Closing Date, a letter dated the date of delivery thereof
from the independent accountants of the Company who have certified the
financial statements of the Company included or incorporated by reference
in the Registration Statement stating that (1) with respect to the Company
and its subsidiaries they are independent accountants within the meaning of
the Act and the applicable published rules and regulations thereunder; (2)
in their opinion the unaudited consolidated financial statements of the
Company and subsidiary companies included or incorporated by reference in
the Registration Statement and examined by such firm comply as to form in
all material respects with the applicable accounting requirements of the Act
and the published rules and regulations thereunder; (3) on the basis of the
following procedures (but not an examination in accordance with generally
accepted auditing standards a reading of the minutes of meetings of the
Board of Directors and stockholders of the Company and its subsidiaries
since the date of the last audited Balance Sheet as set forth in the minute
books through a specified date not more than five business days prior to
the date of delivery of such letter, (B) performance of the procedures
specified by the American Institute of Certified Public Accountants for
a review of interim financial information as described in SAS 71, Interim
Financial Information, on the unaudited condensed consolidated interim
financial statements of the Company and its subsidiaries as incorporated
by reference in the Registration Statement and the Prospectus, (C) if
applicable, a reading of the latest available unaudited interim financial
data, and (D) inquiries of certain officials of the Company who have
responsibility for financial and accounting matters, nothing has come
to their attention which caused them to believe that (I) the unaudited
condensed consolidated interim financial statements, incorporated by
reference in the Registration Statement and the Prospectus, do not comply
as to form in all material respects with the applicable accounting
requirements of the Act and the published rules and regulations thereunder;
(II) any material modifications should be made to the unaudited condensed
consolidated interim financial statements, incorporated by reference in the
Registration Statement and the Prospectus, for them to be in conformity
with generally accepted accounting principles; and (III) on the basis
of inquiries of certain officials of the Company who have responsibilities
for financial and accounting matters and a reading of the minutes as stated
above, nothing has come to their attention which caused them to believe
that there was any change at the date of the latest available interim
financial data and at a specified date not more than five business days
prior to the date of delivery of such letter in the capital stock, other
than changes arising as a result of sales of Common Stock under the
Company's Dividend Reinvestment and Stock Purchase Plan and Employee
Savings Fund Plan, or long-term debt of the Company and its consolidated
subsidiaries as compared with amounts shown on the latest balance sheet
included or incorporated by reference in the Registration Statement, or
for the period from the date of the Company's latest balance sheet included
or incorporated by reference in the Registration Statement to the end of
the preceding calendar month for which balance sheet data is available,
there were any decreases, as compared with the corresponding period in the
preceding year, in consolidated operating revenues or net income, or any
decreases in unconsolidated capitalization, as compared with amounts shown
on the latest balance sheet included or incorporated by reference in the
Registration Statement, except in all instances for changes or decreases
which the Registration Statement discloses have occurred or may occur.
The letters of such independent accountants also shall be to the effect
that they have carried out certain specified procedures, not constituting
an audit, with respect to certain amounts, percentages and financial
information which are derived from the general accounting records of the
Company, which appear or are incorporated by reference in the Registration
Statement and Prospectus and which are specified by the Representatives,
and have compared such amounts, percentages and financial information with
the accounting records of the Company and have found them to be in
agreement.
(h) Subsequent to the respective dates as of which information is given in
the Registration Statement and the Prospectus, there shall not have been
any change or decrease specified in the letter or letters referred to in
paragraph (g) of this Section 6 which makes it impractical or inadvisable
in the judgment of the Representative to proceed with the public offering
or the delivery of the Securities as contemplated by the Prospectus.
(i) Prior to the Closing Date, the Company shall furnish to the Representative
such further information, certificates and documents as they may reasonably
request.
(j) The PSC shall have issued a written order or orders (the "PSC Orders")
authorizing the issuance by the Company of the Securities, the PSC Orders
shall remain in full force and effect on the Closing Date.
If any of the conditions specified in this Section 6 shall not have been
fulfilled when and as required by this Agreement, or if any of the opinions and
certificates mentioned above or elsewhere in this Agreement shall not be in all
material respects satisfactory in form and substance to the Representative and
their counsel, this Agreement and all obligations of the Underwriters hereunder
may be canceled at, or at any time prior to, the Closing Date by the
Representative. Notice of such cancellation shall be given to the Company in
writing, or by telephone or telegraph confirmed in writing.
7. Conditions of Company's Obligations
-----------------------------------
The obligations of the Company to sell and deliver the Securities are
subject to the following conditions:
(a) Prior to the Closing Date, no stop order suspending the effectiveness of
the Registration Statement shall have been issued and no proceedings for
that purpose shall have been instituted or, to the knowledge of the Company
or the Representatives, threatened.
(b) The PSC shall have granted authorization, and on the Closing Date such
authorization shall be in full force and effect, permitting the issuance
and sale of the Securities upon the terms and conditions hereunder set
forth or contemplated and containing no provision unacceptable to the
Company.
(c) The Underwriters shall have furnished to the Company completed underwriters'
questionnaires from each underwriter named in Schedule II hereto, in form
and substance satisfactory to counsel for the Company, which disclose no
relationship between any such underwriter, or its directors, officers or
partners, and the Company or the Trustee, or the directors, officers or
partners thereof, which would require, in the opinion of such counsel, an
amendment of the Statement of Eligibility under the Trust Indenture Act on
Form T-l filed by the Trustee and disqualification of the Trustee.
If any of the conditions specified in this Section 7 shall not have been
fulfilled, this Agreement and all obligations of the Company hereunder may
be canceled on or at any time prior to the Closing Date by the Company.
Notice of such cancellation shall be given to the Underwriters in writing or
by telephone or telegraph confirmed in writing.
8. Reimbursement of Underwriters' Expenses
---------------------------------------
If the sale of the 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 or because of any refusal, inability or failure on
the part of the Company to perform any agreement herein or comply with any
provision hereof, other than by reason of a default by any of the
Underwriters, the Company will reimburse the Underwriters severally upon
demand for all out-of-pocket expenses (including fees and disbursements of
counsel not to exceed $30,000) that shall have been reasonably incurred by
them in connection with the proposed purchase and sale of the Securities.
9. Indemnification
---------------
(a) The Company agrees to indemnify and hold harmless 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 Securities as originally filed or in any
amendment thereof, or in the 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, in the light of
the circumstances under which they were made, not misleading, and agrees
to reimburse each such indemnified party 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 Company will not be liable in any such case to the extent that any such
loss, claim, damage or liability arises out of or is based upon 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 Company by or on behalf of any Underwriter
through the Representative specifically for use in connection with the
preparation thereof; and provided, further, that such indemnity with
respect to a prospectus included in the Registration Statement or any
amendment thereto prior to the supplementing thereof with the Prospectus
Supplement shall not inure to the benefit of any Underwriter (or any
person controlling such Underwriter) from whom the person asserting any
such loss, claim, damage or liability purchased the Securities which are
the subject thereof if such person did not receive a copy of the
Prospectus as amended or supplemented (but without the documents
incorporated by reference therein) at or prior to the confirmation of the
sale of such Securities to such person in any case where such delivery is
required by the Act and the untrue statement or omission of a material fact
contained in the Prospectus was corrected in the Prospectus as amended or
supplemented. This indemnity agreement will be in addition to any
liability which the Company may otherwise have.
(b) Each Underwriter severally agrees to indemnify and hold harmless the
Company, each of its directors, each of its officers who has signed the
Registration Statement and each person, if any, who controls the Company
within the meaning of either the Act or the Exchange Act, to the same
extent as the foregoing indemnity from the Company to the Underwriters
but only with reference to written information furnished to the Company
by or on behalf of such Underwriter through the Representative specifically
for use in the preparation of the documents referred to in the foregoing
indemnity, and agrees to reimburse each such indemnified party for any
legal or other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim, damage, liability or
action. This indemnity agreement will be in addition to any liability
which any Underwriter may otherwise have.
(c) Promptly after receipt by an indemnified party under this Section 9 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 9, notify the indemnifying party in writing of the
commencement thereof; but the omission to so notify the indemnifying
party will not relieve it from any liability which it may have to any
indemnified party otherwise than under this Section 9. 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, if the defendants 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 and/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 assume
such legal defenses and to otherwise 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 9 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, approved by
the Representative in the case of subparagraph (a), representing the
indemnified parties under subparagraphs (a) or (b), as the case may be,
who are parties to such action), (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; and except that, if clause (i) or (iii) is applicable, such liability
shall be only in respect of the counsel referred to in such clause (i) or
(iii). In any case to which an exception set forth in (i), (ii) or (iii)
above applies, the fees and expenses of counsel shall be at the expense of
the indemnifying party.
(d) In order to provide for just and equitable contribution in circumstances
in which the indemnification provided for in subparagraph (a) is due in
accordance with its terms but is for any reason unavailable from the Company
or insufficient to hold the Underwriters harmless in respect of any losses
claims, damages or liabilities (or actions in respect thereof) referred to
therein, the Company and the Underwriters shall contribute to the aggregate
losses, claims, damages and liabilities (or actions in respect thereof) to
which the Company and one or more of the Underwriters may be subject, as a
result of such losses, claims, damages or liabilities (or actions in respect
thereof), in such proportion as is appropriate to reflect the relative fault
of the Company on the one hand and the Underwriters on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities (or actions in respect thereof), as well as
any other equitable considerations, including relative benefit. The
relative fault shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to
information supplied by the Company on the one hand or the Underwriters
on the other and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or
omission. The relative benefits received by the Company on the one hand
and the Underwriters on the other shall be deemed to be in the same
proportion as the total net proceeds from the offering of the Securities
(before deducting expenses) received by the Company bear to the total
underwriting discounts and commissions received by the Underwriters with
respect to the offering of the Securities, in each case as set forth in the
table on the cover page of the Prospectus Supplement. Notwithstanding the
foregoing, no person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Act) shall be entitled to contribution
from any person who was not guilty of such fraudulent misrepresentation.
The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this subparagraph (d) 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
subparagraph (d). The amount paid or payable by a party entitled to
contribution as a result of the losses, claims, damages or liabilities (or
actions in respect thereof) referred to above in this subparagraph (d) shall
be deemed to include any legal or other expenses reasonably incurred by such
party in connection with investigating or defending any such action or
claim. The Underwriters' obligations under this subparagraph (d) are
several in proportion to their respective underwriting obligations and not
joint. For purposes of this subparagraph d), each person, if any, who
controls an Underwriter within the meaning of either the Act or the Exchange
Act shall have the same rights to contribution as such Underwriter, and each
person, if any, who controls the Company within the meaning of either the
Act or the Exchange Act, each officer of the Company who shall have signed
the Registration Statement and each director of the Company shall have the
same rights to contribution as the Company, subject to the fourth sentence
of this subparagraph (d).
10. Default by an Underwriter
-------------------------
If any one or more of the Underwriters shall fail to purchase and pay for
all of the 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 amount of Securities set forth
opposite their names in Schedule II hereto bears to the aggregate amount of
Securities set forth opposite the names of all the remaining Underwriters)
the Securities which the defaulting Underwriter or Underwriters agreed but
failed to purchase; provided, however, that in the event that the aggregate
amount of Securities which the defaulting Underwriter or Underwriters
agreed but failed to purchase shall exceed l0% of the aggregate amount of
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 Securities, and if such nondefaulting Underwriters do
not purchase all of the Securities, this Agreement will terminate without
liability on the part of any nondefaulting Underwriter or the Company. In
the event of a default by any Underwriter, as set forth in this Section 10,
the Closing Date shall be postponed for such period, not exceeding seven
days, as the Representative shall determine in order that the required
changes in the Registration Statement and in the Prospectus or in any other
documents or arrangements may be effected. Nothing herein contained shall
relieve any defaulting Underwriter of its liability, if any, to the Company
or any nondefaulting Underwriter for damages occasioned by its default
hereunder.
11. Termination
-----------
This Agreement shall be subject to termination in the absolute discretion
of the Representative, by notice given to the Company prior to delivery of
and payment for all Securities, (a) if prior to such time trading in
securities generally on the New York Stock Exchange shall have been
suspended or limited or minimum prices shall have been established, or (b)
if a banking moratorium shall have been declared either by federal or New
York State authorities, or (c) if trading in any securities of the Company
shall have been suspended or halted, or (d) if there shall have occurred
any new outbreak or material escalation of hostilities or other calamity
or crisis the effect of which on the financial markets in the United States
is such as to make it, in the judgment of the Representative, impracticable
or inadvisable to market the Securities or to enforce contracts for the
sale of the Securities.
12. Representations and Indemnities to Survive Delivery
---------------------------------------------------
The respective agreements, representations, warranties, indemnities and
other statements of the Company or its officers 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 Company or any of its officers or directors or any
controlling person within the meaning of the Act, and will survive delivery
of and payment for the Securities. The provisions of Sections 5, 8 and 9
hereof shall survive the termination or cancellation of this Agreement.
13. Notices
-------
All communications hereunder will be in writing and, if sent to the
Representatives, will be mailed, delivered or telegraphed and confirmed to
them at their address set forth for that purpose in Schedule I hereto or, if
sent to the Company, will be mailed, delivered or telegraphed and confirmed
to it at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, attention of
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇., Vice President and General Counsel.
14. Successors
----------
This Agreement will inure to the benefit of and be binding upon the parties
hereto and their respective successors and the officers and directors and
controlling persons referred to in Section 9 hereof, and no other person
will have any right or obligation hereunder.
15. Applicable Law
--------------
This Agreement will be governed by and construed in accordance with the
internal substantive laws and not the choice of law rules of the State of
New York.
16. Counterparts
------------
This Agreement may be executed in counterparts, all of which, taken
together, shall constitute a single agreement among the parties to such
counterparts.
17. Representation of the Underwriters
----------------------------------
The Representative represents and warrants to the Company that it is
authorized to act as the representative of the Underwriters in connection
with this financing and that the execution and delivery of this Agreement
and any action under this Agreement taken by such Representative will be
binding upon all Underwriters.
18. Interpretation When No Representatives
--------------------------------------
In the event no Underwriters are named in Schedule II hereto, the term
"Underwriters" shall be deemed for all purposes of this Agreement to be the
Underwriter or Underwriters named as such in Schedule I hereto, the
principal amount of the Securities to be purchased by any such Underwriter
shall refer to that set opposite its name in Schedule I hereto and all
references to the "Representatives" shall be deemed to refer to the
Underwriter or Underwriters named in Schedule I.
If the foregoing is in accordance with your understanding of our agreement,
kindly sign and return to us the enclosed duplicate hereof, whereupon this
letter and your acceptance shall represent a binding agreement among the
Company and the several Underwriters in accordance with its terms.
Very truly yours,
NIAGARA MOHAWK POWER CORPORATION
By: /s/▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Chief Financial Officer
The foregoing Agreement is hereby confirmed and accepted as of the date first
above written.
For themselves and as Representative of the several Underwriters, if any, named
in Schedule II hereto.
By: ▇▇▇▇▇▇▇▇▇, Lufkin & ▇▇▇▇▇▇▇▇ Securities Corporation,
as Representative
By: /s/▇▇▇▇▇ ▇▇▇▇▇
----------------------------
▇▇▇▇▇ ▇▇▇▇▇
Title: Senior Vice President
SCHEDULE I
Underwriting Agreement dated: May 9, 2000
Registration Statement No. 333-33826
Representative & Address: ▇▇▇▇▇▇▇▇▇, Lufkin & ▇▇▇▇▇▇▇▇ Securities Corporation,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Bonds:
Designation: 8-7/8% Senior Notes Due 2007
Principal Amount: $200,000,000
Supplemental Indenture: Dated as of May 12, 2000
Date of Maturity: May 15, 2007
Interest Rate: 8-7/8%
Purchase Price: $198,296,000
Public Offering Price: $199,546,000
Redemption Provisions: Redeemable by the Company at any time, at a
redemption price equal to 100% of the principal amount thereof, plus accrued and
unpaid interest thereon through the redemption date plus the excess of (i) the
discounted future cash flow on such Note (discounted at a rate equal to that
Note by comparable U.S. Treasury obligation plus 0.30%), over (ii) the principal
amount of such Note.
Closing Date and Location: ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
SCHEDULE II
Principal
Amount of
Name of Underwriter New Bonds
------------------- ---------
▇▇▇▇▇▇▇▇▇ Lufkin & ▇▇▇▇▇▇▇▇ Securities Corporation $125,000,000
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated 25,000,000
▇.▇. ▇▇▇▇▇▇ Securities, Inc. 25,000,000
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, Inc. 25,000,000
---------------
Total $200,000,000
===============