15,000,000 Shares PUGET ENERGY, INC. (a Washington corporation) Common Stock UNDERWRITING AGREEMENT
Exhibit
1.1
15,000,000
Shares
PUGET
ENERGY, INC.
(a
Washington corporation)
Common
Stock
Dated:
October 26, 2005
15,000,000
Shares
PUGET
ENERGY, INC.
(a
Washington corporation)
Common
Stock
October
26, 2005
▇▇▇▇▇▇
BROTHERS INC.
▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇
▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies
and Gentlemen:
Puget
Energy, Inc., a Washington corporation (the “Company”), confirms its agreement
with ▇▇▇▇▇▇ Brothers Inc. ("▇▇▇▇▇▇ Brothers" or the “Underwriter”), with respect
to the issue and sale by the Company and the purchase by the Underwriter of
15,000,000 shares (the “Firm Securities”) of the Company's Common Stock, par
value $0.01 per share (the “Common Stock”). In addition, the Company proposes to
grant to the Underwriter an option to purchase an additional 1,690,000 shares
of
Common Stock on the terms set forth herein (the “Option Securities” and together
with the Firm Securities, the “Securities”).
The
Company understands that the Underwriter proposes to make a public offering
of
the Securities as soon as it deems advisable after this Agreement has been
executed and delivered.
The
Company has filed with the Securities and Exchange Commission (the “Commission”)
a registration statement on Form S-3 (No. 333-124153-01), including
the
related preliminary prospectus or prospectuses, covering the registration of
the
Securities under the Securities Act of 1933, as amended (the “1933 Act”). The
Company has prepared and filed, or promptly after execution and delivery of
this
Agreement will prepare and file, a prospectus supplement in accordance with
the
provisions of paragraph (b) of Rule 424 (“Rule 424(b)”) of the rules and
regulations of the Commission under the 1933 Act (the “1933 Act Regulations”).
Such registration statement, including the exhibits and any schedules thereto,
at the time it became effective, and including the documents incorporated by
reference therein pursuant to Item 12 of Form S-3 under the 1933 Act at such
time, is herein called the “Registration Statement.” The final prospectus,
including the prospectus supplement, in the form first furnished to the
Underwriter for use in connection with the offering of the Securities, including
the documents incorporated by reference therein pursuant to Item 12 of Form
S-3
under the 1933 Act at the time of the execution of this Agreement, is herein
called the “Prospectus.” For purposes of this Agreement, all references to the
Registration Statement, any preliminary prospectus, or the Prospectus or any
amendment or supplement to any of the foregoing shall be deemed to include
the
copy filed with the Commission pursuant to its Electronic Data Gathering,
Analysis and Retrieval system (“▇▇▇▇▇”).
All
references in this Agreement to financial statements and schedules and other
information which is “contained,”“included” or “stated” in the Registration
Statement, any preliminary prospectus or the Prospectus (or other references
of
like import) shall be deemed to mean and include all such financial statements
and schedules and other information which is incorporated by reference in the
Registration Statement, any preliminary prospectus or the Prospectus, as the
case may be; and all references in this Agreement to amendments or supplements
to the Registration Statement, any preliminary prospectus or the Prospectus
shall be deemed to mean and include the filing of any document under the
Securities Exchange Act of 1934 (the “1934 Act”) which is incorporated by
reference in the Registration Statement, such preliminary prospectus or the
Prospectus, as the case may be.
SECTION
1. Representations
and Warranties.
(a) Representations
and Warranties by the Company.
The
Company represents and warrants to the Underwriter as of the date hereof
and as
of the Closing Time referred to in Section 2(b) hereof, and agrees with the
Underwriter, as follows:
(i) Compliance
with Registration Requirements.
The
Company meets the requirements for use of Form S-3 under the 1933 Act. Each
of
the Registration Statement and any post-effective amendment thereto has become
effective under the 1933 Act and no stop order suspending the effectiveness
of
the Registration Statement or any post-effective amendment thereto has been
issued under the 1933 Act and no proceedings for that purpose have been
instituted or are pending or, to the knowledge of the Company, are contemplated
by the Commission, and any request on the part of the Commission for additional
information has been complied with.
At
the
respective times the Registration Statement and any post-effective amendments
thereto became effective and at the Closing Time (and, if any Option Securities
are purchased, at the Date of Delivery), the Registration Statement and any
amendments and supplements thereto complied and will comply in all material
respects with the requirements of the 1933 Act and the 1933 Act Regulations
and
did not and will not contain an untrue statement of a material fact or omit
to
state a material fact required to be stated therein or necessary to make
the
statements therein not misleading. Neither the Prospectus nor any amendments
or
supplements thereto, at the time the Prospectus or any such amendment or
supplement was issued and at the Closing Time (and, if any Option Securities
are
purchased, at the Date of Delivery), included or will include an untrue
statement of a material fact or omitted or will omit to state a material
fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading. The representations
and warranties in this subsection shall not apply to statements in or omissions
from the Registration Statement or Prospectus made in reliance upon and in
conformity with written information furnished to the Company by the Underwriter
through ▇▇▇▇▇▇ Brothers expressly for use in the Registration Statement (or
any
amendment thereto) or in the Prospectus (or any amendment or supplement
thereto).
Each
preliminary prospectus and the prospectus filed as part of the Registration
Statement as originally filed or as part of any amendment thereto complied
when
so filed in all material respects with the 1933 Act Regulations and each
preliminary prospectus and the Prospectus delivered to the Underwriter for
use
in connection with this offering was identical to the electronically transmitted
copies thereof filed with the Commission pursuant to ▇▇▇▇▇, except to the
extent
permitted by Regulation S-T.
(ii) Incorporated
Documents.
The
documents incorporated or deemed to be incorporated by reference in the
Registration Statement and the Prospectus, at the time they were or hereafter
are filed with the Commission, complied and will comply in all material respects
with the requirements of the 1934 Act and the rules and regulations of the
Commission thereunder (the “1934 Act Regulations”), and, when read together with
the other information in the Prospectus, at the time the Registration Statement
became effective, at the time the Prospectus was issued and at the Closing
Time
(and, if any Option Securities are purchased, at the Date of Delivery), did
not
and will not contain an untrue statement of a material fact or omit to state
a
material fact required to be stated therein or necessary to make the statements
therein not misleading.
(iii) Independent
Accountants.
The
accountants who certified the financial statements and supporting schedules
included in the Registration Statement are independent public accountants
as
required by the 1933 Act and the 1933 Act Regulations.
(iv) Financial
Statements.
The
historical financial statements (including the related notes and supporting
schedules) filed as part of the Registration Statement or included or
incorporated by reference in the Prospectus comply as to form in all material
respects with the requirements of Regulation S-X under the 1933 Act and present
fairly the financial condition, results of operations and cash flows of the
entities purported to be shown thereby at the dates and for the periods
indicated and have been prepared in conformity with generally accepted
accounting principles ("GAAP") applied on a consistent basis throughout the
periods involved. The pro forma financial statements (including the related
notes) filed as part of the Registration Statement or included or incorporated
by reference in the Prospectus comply as to form in all material respects
with
the requirements of Regulation S-X under the 1933 Act and present fairly,
in
accordance with GAAP, the information shown therein. Such pro forma financial
statements have been properly compiled on the bases described therein, the
assumptions used in preparation thereof are reasonable and the adjustments
used
therein are appropriate to give effect to the transactions and circumstances
referred to therein.
(v) Critical
Accounting Policies.
The
section entitled "Management's Discussion and Analysis of Financial Condition
and Results of Operations" in the Prospectus accurately and fully in all
material respects describes (A) the accounting policies that the Company
believes are the most important in the portrayal of the Company’s financial
condition and results of operations and that require management’s most
difficult, subjective or complex judgments (“Critical Accounting Policies”); and
(B) the judgments and uncertainties affecting the application of Critical
Accounting Policies.
(vi) No
Material Adverse Change in Business.
Since
the respective dates as of which information is given in the Registration
Statement and the Prospectus, except as otherwise stated therein, (A) there
has been no 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 Effect”), (B) there have
been no transactions entered into by the Company or any of its subsidiaries,
other than those in the ordinary course of business, which are material
with
respect to the Company and its subsidiaries considered as one enterprise,
and
(C) except for regular quarterly dividends on the Common Stock and
on the
preferred stock, par value $100 per share, of the Company in amounts per
share
that are consistent with past practice, there has been no dividend or
distribution of any kind declared, paid or made by the Company on any class
of
its capital stock.
(vii) Good
Standing of the Company.
Each of
the Company and its subsidiaries has been duly organized and is validly existing
as a corporation under the laws of the State of Washington and 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 this Agreement; and the Company is duly qualified as a foreign
corporation to transact business and is in good standing in each other
jurisdiction in which such qualification is required, whether by reason of
the
ownership or leasing of property or the conduct of business, except where the
failure so to qualify or to be in good standing would not result in a Material
Adverse Effect.
(viii) Significant
Subsidiaries.
The
Company has no “significant subsidiaries” (as such term is defined in Rule 1-02
of Regulation S-X) other than Puget Sound.
(ix) Authorization
of Agreement.
This
Agreement has been duly authorized, executed and delivered by the
Company.
(x) Authorization
of the Capital Stock of the Company.
The
Company has an authorized capitalization as set forth in its most recent
Quarterly Report on Form 10-Q, which is incorporated by reference into the
Prospectus, and all of the issued shares of capital stock of the Company have
been duly authorized and validly issued, are fully paid and non-assessable,
conform to the description thereof contained in the Prospectus and were issued
in compliance with federal and state securities laws and not in violation of
any
preemptive right, resale right, right of first refusal or similar right. Except
as set forth in the Prospectus, no options, warrants or other rights to purchase
or exchange any securities for shares of the Company's capital stock are
outstanding. All of the issued shares of capital stock of each subsidiary of
the
Company have been duly authorized and validly issued, are fully paid and
non-assessable and are owned directly or indirectly by the Company, free and
clear of all liens, encumbrances, equities or claims, except for such liens,
encumbrances, equities or claims as could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.
(xi) Authorization
of the Securities.
The
Securities to be issued and sold by the Company to the Underwriter hereunder
have been duly authorized and, upon payment and delivery in accordance with
this
Agreement, will be validly issued, fully paid and non-assessable, will conform
to the description thereof contained in the Prospectus, will be issued in
compliance with federal and state securities laws and will be free of statutory
and contractual preemptive rights, resale rights, rights of first refusal and
similar rights.
(xii) Registration
Rights.
There
are no contracts, agreements or understandings between the Company and any
person granting such person the right to require the Company to file a
registration statement under the Securities Act with respect to any securities
of the Company owned or to be owned by such person or to require the Company
to
include such securities in the securities registered pursuant to the
Registration Statement or in any securities being registered pursuant to any
other registration statement filed by the Company under the Securities
Act.
(xiii) Integration.
The
Company has not sold or issued any securities that would be integrated with
the
offering of the Securities contemplated by this Agreement pursuant to the 1933
Act, the 1933 Act Regulations or the interpretations thereof by the
Commission.
(xiv) Absence
of Defaults and Conflicts.
Neither
the Company nor any of its subsidiaries 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 that would not reasonably be expected to
result in 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, defaults or Repayment Events or liens, charges or
encumbrances that would not reasonably be expected to result in a Material
Adverse Effect), nor will such
action result in (x) any violation of the provisions of the charter or by-laws
of the Company or any subsidiary or (y) 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 (except for such violations in the case of clause (y) that would
not reasonably be expected to result in a Material Adverse Effect). 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 of all or a portion of such indebtedness by the Company or any
subsidiary.
(xv) Absence
of Labor Dispute.
No
labor dispute with the employees of the Company or any subsidiary exists or,
to
the knowledge of the Company, is imminent, and the Company is not aware of
any
existing or imminent labor disturbance by the employees of any of its or any
subsidiary’s principal suppliers, manufacturers, customers or contractors,
which, in either case, would reasonably be expected to result in a Material
Adverse Effect.
(xvi) Absence
of Proceedings.
There
is no action, suit, proceeding, inquiry or investigation (collectively
“Proceedings”) before or brought by any court or governmental agency or body,
domestic or foreign, now pending, or, to the knowledge of the Company,
threatened, against or affecting the Company or any subsidiary, which is
required to be disclosed in the Registration Statement (other than as disclosed
therein), or, except for Proceedings described in the Registration Statement
or
the Prospectus, (A) which might result in a Material Adverse Effect, or (B)
which might materially and adversely affect the consummation of the transactions
contemplated in this Agreement or the performance by the Company of its
obligations hereunder.
(xvii) Accuracy
of Exhibits.
There
are no contracts or documents which are required to be described in the
Registration Statement, the Prospectus or the documents incorporated by
reference therein or to be filed as exhibits thereto which have not been so
described and filed as required.
(xviii) Absence
of Manipulation.
Neither
the Company nor, to the knowledge of the Company, any affiliate of the Company
has taken, nor will the Company or, to the knowledge of the Company, any
affiliate take, directly or indirectly, any action which is designed to or
which
has constituted or which would be expected to cause or result in stabilization
or manipulation of the price of any security of the Company to facilitate the
sale or resale of the Securities.
(xix) 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 1933 Act Regulations or state securities laws.
(xx) Possession
of Licenses and Permits.
The
Company and its subsidiaries possess such permits, licenses, approvals, consents
and other authorizations (collectively, “Governmental Licenses”) issued by the
appropriate federal, state, local or foreign regulatory agencies or bodies,
including, without limitation, the Washington Utilities and Transportation
Commission and cities and towns within the service territory of the Company
and
its subsidiaries, necessary to conduct the business now operated by them and
for
Puget Sound to own and operate its electric plant and its gas plant; the Company
and its subsidiaries are in compliance with the terms and conditions of all
such
Governmental Licenses, except where the failure so to comply would not, singly
or in the aggregate, result in a Material Adverse Effect; all of the
Governmental Licenses are valid and in full force and effect, except when the
invalidity of such Governmental Licenses or the failure of such Governmental
Licenses to be in full force and effect would not, singly or in the aggregate,
result in a Material Adverse Effect; and neither the Company nor any of its
subsidiaries has received any notice of proceedings relating to the revocation
or modification of any such Governmental Licenses which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or finding, would
result in a Material Adverse Effect.
(xxi) Title
to Property.
The
Company and its subsidiaries have good and marketable title to all real property
owned by the Company and its subsidiaries and good title to all other properties
owned by them, in each case, free and clear of all mortgages, pledges,
liens, security interests, claims, restrictions or encumbrances of any kind
except such as (a) are described in the Prospectus, (b) do not, singly or in
the
aggregate, materially affect the value of such property and do not interfere
with the use made and proposed to be made of such property by the Company or
any
of its subsidiaries or (c) could not reasonably be expected, individually or
in
the aggregate, to have a Material Adverse Effect; and all of the leases and
subleases material to the business of the Company and its subsidiaries,
considered as one enterprise, and under which the Company or any of its
subsidiaries holds properties described in the Prospectus, are in full force
and
effect, and neither the Company nor any subsidiary has any notice of any
material claim of any sort that has been
asserted by any party adverse to the rights of the Company or any subsidiary
under any of the leases or subleases mentioned above, or affecting or
questioning the rights of the
Company or such subsidiary to the continued possession of the leased or
subleased premises under any such lease or sublease.
(xxii) Investment
Company Act.
The
Company is not required, 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 required, to register as, an “investment
company” under the Investment Company Act of 1940, as amended (the “1940
Act”).
(xxiii) Environmental
Laws.
Except
as described in the Registration Statement or the Prospectus and except as
would
not, singly or in the aggregate, result in a Material Adverse Effect, (A)
neither the Company nor any of its subsidiaries is in violation of any federal,
state, local or foreign statute, law, rule, regulation, ordinance, code, policy
or rule of common law or any judicial or administrative interpretation thereof,
including any judicial or administrative order, consent, decree or judgment,
relating to pollution or protection of human health, the environment (including,
without limitation, ambient air, surface water, groundwater, land surface or
subsurface strata) or wildlife, including, without limitation, laws and
regulations relating to the release or threatened release of chemicals,
pollutants, contaminants, wastes, toxic substances, hazardous substances,
petroleum or petroleum products, asbestos-containing materials or mold
(collectively, “Hazardous Materials”) or to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling of
Hazardous Materials (collectively, “Environmental Laws”), (B) the Company and
its subsidiaries have all permits, authorizations and approvals required under
any applicable Environmental Laws and are each in compliance with their
requirements, (C) there are no pending or, to the knowledge of the Company,
threatened administrative, regulatory or judicial actions, suits, demands,
demand letters, claims, liens, notices of noncompliance or violation,
investigation or proceedings relating to any Environmental Law against the
Company or any of its subsidiaries and (D) there are no events or circumstances
that would reasonably be expected
to form the basis of an order for clean-up or remediation, or an action, suit
or
proceeding by any private party or governmental body or agency, against or
affecting the Company or any of its subsidiaries relating to Hazardous Materials
or any Environmental Laws.
(xxiv) Absence
of Certain Relationships.
No
relationship, direct or indirect, exists between or among the Company, on the
one hand, and the directors, officers, stockholders, customers or suppliers
of
the Company, on the other hand, that is required to be described in the
Prospectus which is not so described.
(xxv) ▇▇▇▇▇▇▇▇-▇▇▇▇▇
Act.
The
Company is in compliance in all material respects with all the applicable
provisions of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 and the rules and regulations
promulgated thereunder (the “▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act”) that are currently in effect
and require compliance on or before the date hereof.
(xxvi) Internal
Accounting Controls.
The
Company and its consolidated subsidiaries maintain a system of internal
accounting controls sufficient to provide reasonable assurances that (A)
transactions are executed in accordance with management's general or specific
authorization; (B) transactions are recorded as necessary to permit preparation
of financial statements in conformity with generally accepted accounting
principles and to maintain accountability for assets; (C) access to assets
is
permitted only in accordance with management's general or specific
authorization; and (D) the recorded accountability for assets is compared with
the existing assets at reasonable intervals and appropriate action is taken
with
respect to any differences.
(xxvii) Disclosure
Controls and Procedures.
To the
extent required by the 1934 Act Regulations, the Company's “disclosure controls
and procedures” (as defined in Rules 13a-15 and 15d-15 of the 1934 Act
Regulations) are reasonably designed to ensure that all information (both
financial and non-financial) required to be disclosed by the Company in the
reports that it files or submits under the 1934 Act is recorded, processed,
summarized and reported within the time periods specified in the 1934 Act and
the 1934 Act Regulations, and that all such information is accumulated and
communicated to the Company's management as appropriate to allow timely
decisions regarding required disclosure and to make the certifications of the
principal executive officer and principal financial officer of the Company
required under the 1934 Act with respect to such reports.
(b) Officer’s
Certificates.
Any
certificate signed by any officer of the Company or any of its subsidiaries
delivered to the Underwriter or to counsel for the Underwriter shall be deemed
a
representation and warranty by the Company to the Underwriter as to the matters
covered thereby.
SECTION
2. Sale
and Delivery to Underwriter; Closing.
(a) Firm
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 the
Underwriter, and the Underwriter agrees to purchase from the Company, the Firm
Securities.
(b) Option
Securities.
In
addition, on the basis of the representations and warranties herein contained
and subject to the terms and conditions herein set forth, the Company hereby
grants an option to the Underwriter to purchase 1,690,000 shares of Option
Securities. The option hereby granted will expire 30 days after the date hereof
and is exercisable, from time to time, in the event that the Underwriter sells
more shares of Common Stock than the number of Firm Securities in the offering,
upon notice by the Underwriter to the Company setting forth the number of Option
Securities as to which the Underwriter is then exercising the option and the
time and date of payment and delivery for such Option Securities. Any such
time
and date of delivery (a "Date of Delivery") shall be determined by the
Underwriter, but shall not be earlier than the third business day after exercise
of said option nor later than seven full business days after the exercise of
said option, nor in any event prior to the Closing Time, as hereinafter
defined.
(c) Payment.
Payment
of the purchase price for, and delivery of certificates for, the Securities
shall be made at the offices of Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP, ▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, or at such other place as shall
be
agreed upon by the Underwriter and the Company, at 9:00 A.M. (Eastern
time)
on the third business day after the date hereof, or such other time not later
than ten business days after such date as shall be agreed upon by the
Underwriter and the Company (such time and date of payment and delivery being
herein called “Closing Time”).
In
addition, in the event that any or all of the Option Securities are purchased
by
the Underwriter, payment of the purchase price for, and delivery of certificates
for, such Option Securities shall be made at the above-mentioned offices, or
at
such other place as shall be agreed upon by the Underwriter and the Company,
on
each Date of Delivery as specified in the notice from the Underwriter to the
Company.
Payment
shall be made to the Company by wire transfer of immediately available funds
to
a bank account designated by the Company, against delivery to the Underwriter
for the account of the Underwriter of certificates for the Securities to be
purchased by them.
The
initial public offering price per share for the Securities shall be $20.80.
The
purchase price per share for the Securities to be paid by the Underwriter shall
be $20.67, being an amount equal to the initial public offering price set forth
above less $0.13 per share; provided that the purchase price per share for
any
Option Securities purchased in accordance with Section 2(b) shall be reduced
by
an amount per share equal to any dividends or distributions, if any, declared
by
the Company and payable on the Firm Securities but not payable on the Option
Securities.
(d) Denominations;
Registration.
Certificates for the Firm Securities and the Option Securities, if any, shall
be
in such denominations and registered in such names as the Underwriter may
request in writing at least one full business day before the Closing Time or
the
relevant Date of Delivery, as the case may be. The certificates for the Firm
Securities and the Option Securities, if any, shall be made available for
examination and packaging by the Underwriter in The City of New York not later
than 10:00 A.M. (eastern daylight time) on the business day prior to the Closing
Time or the relevant Date of Delivery, as the case may be.
SECTION
3. Covenants
of the Company.
The
Company covenants with the Underwriter as follows:
(a) Compliance
with Securities Regulations and Commission Requests.
During
the period when the Prospectus is required to be delivered under the 1933 Act
in
connection with the offer and sale of the Securities, the Company, subject
to
Section 3(b), will notify the Underwriter 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 any document incorporated by reference therein 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) 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.
(b) Filing
of Amendments.
During
the period when the Prospectus is required to be delivered under the 1933 Act
in
connection with the offer and sale of the Securities, the Company will give
the
Underwriter notice of its intention to file or prepare any amendment to the
Registration Statement or any amendment, supplement or revision to either the
prospectus included in the Registration Statement at the time it became
effective or to the Prospectus, whether pursuant to the 1933 Act, the 1934
Act
or otherwise, will furnish the Underwriter 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 Underwriter or
counsel for the Underwriter shall reasonably object.
(c) Delivery
of Registration Statements.
The
Company has furnished or will deliver to the Underwriter and counsel for the
Underwriter, without charge, signed copies 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 signed copies of all
consents and certificates of experts, and will also deliver to the Underwriter,
without charge, a conformed copy of the Registration Statement as originally
filed and of each amendment thereto (without exhibits). The copies of the
Registration Statement and each amendment thereto furnished to the Underwriter
will be identical to the electronically transmitted copies thereof filed with
the Commission pursuant to ▇▇▇▇▇, except to the extent permitted by
Regulation S-T.
(d) Delivery
of Prospectuses.
The
Company has delivered to the Underwriter, without charge, as many copies of
each
preliminary prospectus as the 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 the Underwriter, without charge, during the
period when the Prospectus is required to be delivered under the 1933 Act,
such
number of copies of the Prospectus (as amended or supplemented) as the
Underwriter may reasonably request. The Prospectus and any amendments or
supplements thereto furnished to the Underwriter 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 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
counsel for the Underwriter 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 statements 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 Underwriter such number of copies of such
amendment or supplement as the Underwriter may reasonably request.
(f) Blue
Sky Qualifications.
The
Company will use its best efforts, in cooperation with the Underwriter, to
qualify the Securities for offering and sale under the applicable securities
laws of such states and other jurisdictions as the Underwriter may designate;
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. The Company will also supply the Underwriter with such
information as is necessary for the determination of the legality of the
Securities for investment under the laws of such jurisdictions as the
Underwriter may reasonably request.
(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) Restriction
on Sale of Securities.
For
a
period commencing on the date hereof and ending on the 90th
day
after the date of the Prospectus (the "Lock-Up Period"), the Company will not,
directly or indirectly, (1) offer for sale, sell, pledge or otherwise dispose
of
(or enter into any transaction or device that is designed to, or could be
expected to, result in the disposition by any person at any time in the future
of) any shares of Common Stock or securities convertible into or exchangeable
for Common Stock, or sell or grant options, rights or warrants with respect
to
any shares of Common Stock or securities convertible into or exchangeable for
Common Stock, (2) enter into any swap or other derivatives transaction that
transfers to another, in whole or in part, any of the economic benefits or
risks
of ownership of such shares of Common Stock, whether any such transaction
described in clause (1) or (2) above is to be settled by delivery of Common
Stock or other securities, in cash or otherwise, (3) file or cause to be filed
a
registration statement, including any amendments, with respect to the
registration of any shares of Common Stock or securities convertible,
exercisable or exchangeable into Common Stock or any other securities of the
Company or (4) publicly disclose the intention to do any of the foregoing,
in
each case without the prior written consent of the Underwriter, which consent
shall not be unreasonably withheld, other than the Securities to be sold
hereunder, any shares of Common Stock issued pursuant to existing benefits
plans
or agreements with employees or directors and any shares of Common Stock issued
pursuant to the Company's Stock Purchase and Dividend Reinvestment Plan in
effect on the date hereof.
Notwithstanding
the foregoing paragraph, if (1) during the last 17 days of the Lock-Up Period,
the Company issues an earnings release or material news or a material event
relating to the Company occurs or (2) prior to the expiration of the Lock-Up
Period, the Company announces that it will release earnings results during
the
16-day period beginning on the last day of the Lock-Up Period, then the
restrictions imposed in the preceding paragraph shall continue to apply until
the expiration of the 18-day period beginning on the issuance of the earnings
release or the announcement of the material news or the occurrence of the
material event, unless the Underwriter, on behalf of the Underwriter, waives
such extension in writing.
(j) Reporting
Requirements.
The
Company, during the period when the Prospectus is required to be delivered
under
the 1933 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 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) as
originally filed and of each amendment thereto, (ii) the preparation,
printing and delivery to the Underwriter of this Agreement 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 Underwriter, (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 Underwriter in connection therewith and in
connection with the preparation of the Blue Sky Survey and any supplement
thereto, (vi) the printing and delivery to the Underwriter of copies
of
each preliminary prospectus and of the Prospectus and any amendments or
supplements thereto, (vii) the preparation, printing and delivery to
the
Underwriter of copies of the Blue Sky Survey and any supplement thereto, (viii)
the costs and expenses of the Company relating to investor presentations on
any
“road show” undertaken in connection with the marketing of the Securities,
including without limitation, expenses associated with the production of road
show slides and graphics, fees and expenses of any consultants engaged in
connection with the road show presentations, travel and lodging expenses of
the
representatives and officers of the Company and any such consultants, and the
cost of aircraft and other transportation chartered in connection with the
road
show, (ix) any fees payable in connection with the rating of the
Securities
and (x)
the reasonable fees and disbursements of Underwriter's counsel.
(b) Termination
of Agreement.
If this
Agreement is terminated by the Underwriter in accordance with the provisions
of
Section 5 or Section 9(a)(i) hereof, the Company shall reimburse
the
Underwriter for all of their out-of-pocket expenses, including the reasonable
fees and disbursements of counsel for the Underwriter.
SECTION
5. Conditions
of Underwriter's Obligations.
The
obligations of the Underwriter hereunder are subject to the accuracy of the
representations and warranties of the Company contained in Section 1 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:
(a) Effectiveness
of Registration Statement.
The
Registration Statement has become effective and at Closing Time no
stop order
suspending the effectiveness of the Registration Statement shall have been
issued under the 1933
Act
or proceedings therefor initiated or threatened by the Commission, and any
request on the
part
of the Commission for additional information shall have been complied with
to
the reasonable satisfaction of counsel to the Underwriter. A prospectus
supplement has been filed with the Commission in accordance with and within
the
time period required by Rule 424(b).
(b) Opinion
of Counsel for Company.
At
Closing Time, the Underwriter shall have received an opinion, dated as of
Closing Time, of ▇▇▇▇▇▇▇ Coie LLP, counsel for the Company, in form and
substance satisfactory to counsel for the Underwriter to the effect set forth
in
Exhibit B hereto and to such further effect as counsel to the Underwriter may
reasonably request
(it
being understood that such legal opinion will be subject to reasonable and
customary assumptions, qualifications and exclusions).
(c) Opinion
of Counsel for Underwriter.
At
Closing Time, the Underwriter shall have received an opinion, dated as of
Closing Time, of Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP, counsel for the
Underwriter, in form and substance satisfactory to the Underwriter. 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,
upon
the opinions of counsel satisfactory to the Underwriter. 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 public officials.
(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, and the Underwriter shall have received a
certificate of the President or a Vice President of the Company and of the
chief financial
or chief accounting officer 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 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, to their knowledge,
contemplated by the Commission.
(e) Accountant’s
Comfort Letter.
At the
time of the execution of this Agreement, the Underwriter shall have received
from PricewaterhouseCoopers LLP a letter dated such date, in form and substance
satisfactory to the Underwriter 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 Underwriter shall have received from PricewaterhouseCoopers
LLP a letter, dated as of Closing Time, to the effect that they reaffirm the
statements made in the letter furnished pursuant to subsection (e) of
this
Section.
(g) Maintenance
of Rating.
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 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 for possible downgrading its rating of the Securities or any of the
Company’s other securities
(h) NYSE
Listing. The
Securities shall have been approved for listing on the New York Stock
Exchange.
(i) Conditions
to Purchase of Option Securities.
In the
event that the Underwriter exercises its option provided in Section 2(b) hereof
to purchase all or any portion of the Option Securities, the representations
and
warranties of the Company contained herein and the statements in any
certificates furnished by the Company or any subsidiary of the Company hereunder
shall be true and correct as of each Date of Delivery and, at the relevant
Date
of Delivery, the Underwriter shall have received:
(i) Officers'
Certificate. A certificate, dated such Date of Delivery, of the President or
a
Vice President of the Company and of the chief financial or chief accounting
officer of the Company confirming that the certificate delivered at the Closing
Time pursuant to Section 5(d) hereof remains true and correct as of such Date
of
Delivery.
(ii) Opinion
of Counsel for Company. The favorable opinion of ▇▇▇▇▇▇▇ Coie LLP, counsel
for
the Company, in form and substance satisfactory to counsel for the Underwriter,
dated such Date of Delivery, relating to the Option Securities to be purchased
on such Date of Delivery and otherwise to the same effect as the opinion
required by Section 5(b) hereof.
(iii) Opinion
of Counsel for Underwriter. The favorable opinion of Skadden, Arps, Slate,
▇▇▇▇▇▇▇ & ▇▇▇▇ LLP, counsel for the Underwriter, dated such Date of
Delivery, relating to the Option Securities to be purchased on such Date of
Delivery and otherwise to the same effect as the opinion required by Section
5(c) hereof.
(iv) Bring-down
Comfort Letter. A letter from PricewaterhouseCoopers LLP, in form and substance
satisfactory to the Underwriter and dated such Date of Delivery, substantially
in the same form and substance as the letter furnished to the Underwriter
pursuant to Section 5(f) hereof, except that the "specified date" in the letter
furnished pursuant to this paragraph shall be a date not more than five days
prior to such Date of Delivery.
(j) Additional
Documents.
At
Closing Time, and at each Date of Delivery, counsel for the Underwriter shall
have been furnished with such documents and opinions as they may reasonably
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 Underwriter and counsel
for
the Underwriter.
(k) Termination
of Agreement.
If any
condition specified in this Section 5 shall not have been fulfilled when and
as
required to be fulfilled, this Agreement, or, in the case of any condition
to
the purchase of Option Securities, on a Date of Delivery that is after the
Closing Time, the obligations of the Underwriter to purchase the relevant Option
Securities, may be terminated by the Underwriter by notice to the Company at
any
time at or prior to the Closing Time or such Date of Delivery, as the case
may
be, and such termination shall be without liability of any party to any other
party except as provided in Section 4 and except that Sections 1, 6, 7 and
8
shall survive any such termination and remain in full force and
effect.
SECTION
6. Indemnification.
(a) Indemnification
of Underwriter.
The
Company agrees to indemnify and hold harmless the Underwriter, its affiliates,
as such term is defined in Rule 501(b) under the 1933 Act (each, an
“Affiliate”), its selling agents and each person, if any, who controls the
Underwriter within the meaning of Section 15 of the 1933 Act or Section
20
of the 1934 Act, and any director, officer or employee thereof as
follows:
(i) against
any and all loss, liability, claim, damage and expense whatsoever, as incurred,
(A) arising out of any untrue statement or alleged untrue statement of a
material fact contained in any preliminary prospectus, the Registration
Statement or the Prospectus (or in any amendment or supplement 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, (B) in
any
materials or information provided to investors by, or with the written approval
of, the Company in connection with the marketing of the offering of the
Securities (“Marketing Materials”), including any road show or investor
presentations made to investors by the Company (whether in person or
electronically), or (C)
arising
out of any act or failure to act or any alleged act or failure to act by the
Underwriter in connection with, or relating in any manner to, the Securities
or
the offering contemplated hereby, and which is included as part of or referred
to in any loss, claim, damage, liability or action arising out of or based
upon
matters covered by clause (A) or (B) above (provided that the Company shall
not
be liable under this clause (C) to the extent that it is determined in a final
judgment by a court of competent jurisdiction that such loss, claim, damage,
liability or action resulted directly from any such acts or failures to act
undertaken or omitted to be taken by the Underwriter through its gross
negligence or willful misconduct);
(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, or any such alleged untrue statement or omission; provided that
(subject to Section 6(d) below) any such settlement is effected with the written
consent of the Company;
(iii) against
any and all expense whatsoever, as incurred (including the fees and
disbursements of counsel chosen by ▇▇▇▇▇▇ Brothers), 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, or any such alleged untrue statement or omission, to the extent that
any such expense is not paid under (i) or (ii) above;
provided,
however,
that
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 the Underwriter through
▇▇▇▇▇▇ Brothers expressly for use in the Registration Statement (or any
amendment thereto), or any preliminary prospectus or the Prospectus (or any
amendment or supplement thereto); and provided further, that such indemnity
with
respect to the Prospectus shall not inure to the benefit of the Underwriter
(or
any Affiliate of an Underwriter) from whom the person asserting any such loss,
liability, claim, damage or expense purchased the Securities which are the
subject thereof if: (A) such person did not receive a copy of the Prospectus
(or
the Prospectus as 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; (B) the
untrue statement or omission of a material fact contained in the Prospectus
was
corrected in the Prospectus as supplemented, unless the Company shall not have
furnished such Prospectus, as corrected, at a reasonable time prior to such
confirmation; and (C) the timely delivery of the Prospectus to such person
would
have constituted a complete defense to the loss, liability, claim, damage or
expense asserted by such person.
(b) Indemnification
of Company, Directors and Officers.
The
Underwriter 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 the Underwriter expressly for
use in the Registration Statement (or any amendment thereto) or such preliminary
prospectus or the Prospectus (or any amendment or supplement
thereto)
as
specified in subsection (e) of this Section.
(c) Actions
against Parties; Notification.
Each
indemnified party shall give notice as promptly as reasonably practicable to
each indemnifying party of any action commenced against it
in
respect of which indemnity may be sought hereunder, but failure to so notify
an
indemnifying party shall not relieve such indemnifying party from any liability
hereunder to the extent it is not materially prejudiced as a result thereof
and
in any event shall not relieve it from any liability which it may have otherwise
than on account of this indemnity agreement. In the case of parties indemnified
pursuant to Section 6(a) above, counsel to the indemnified parties shall be
selected by ▇▇▇▇▇▇ Brothers, and, in the case of parties indemnified pursuant
to
Section 6(b) above, counsel to the indemnified parties shall be selected by
the
Company. An indemnifying party may participate at its own expense in the defense
of any such action; provided, however, that counsel to the indemnifying party
shall not (except with the consent of the
indemnified party) also be counsel to the indemnified party. In no event shall
the indemnifying parties be liable for fees and expenses of more than one
counsel (in addition to any local counsel) separate from their own counsel
for
all indemnified parties in connection with any one action or separate but
similar or related actions in the same jurisdiction arising out of the same
general allegations or circumstances. No indemnifying party shall, without
the
prior written consent of the indemnified parties, settle or compromise or
consent to the entry of any judgment with respect to any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever in respect of which indemnification or
contribution could be sought under this Section 6 or Section 7 hereof (whether
or not the indemnified parties are actual or potential parties thereto), unless
such settlement, compromise or consent (i) includes an unconditional release
of
each indemnified party from all liability arising out of such litigation,
investigation, proceeding or claim and (ii) does not include a statement as
to
or an admission of fault, culpability or a failure to act by or on behalf of
any
indemnified 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.
(e) Information
Furnished for Inclusion in the Registration Statement and the
Prospectus.
The
Underwriter confirms and the Company acknowledges and agrees that the statements
with respect to the public offering of the Securities by the Underwriter set
forth on the cover page of, and the concession and reallowance figures and
the
paragraph relating to stabilization by the Underwriter and electronic
distribution of the Prospectus appearing under the caption “Underwriting” in,
the Prospectus are correct and constitute the only information concerning the
Underwriter furnished in writing to the Company by or on behalf of the
Underwriter specifically for inclusion in the Registration Statement and the
Prospectus.
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
Underwriter 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 Underwriter 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 Underwriter
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) received by the Company and the total
underwriting discount received by the Underwriter, 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 the cover of the Prospectus.
The
relative fault of the Company on the one hand and the Underwriter 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 the Underwriter and the parties’ relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or
omission.
The
Company and the Underwriter agree that it would not be just and equitable if
contribution pursuant to this Section 7 were determined by pro rata allocation
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 the 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,
the Underwriter’s Affiliates and selling agents, and any director, officer or
employee thereof, shall have the same rights to contribution as the 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.
SECTION
8. Representations,
Warranties and Agreements to Survive.
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 (i) any investigation made by or on behalf of the Underwriter or its
Affiliates or selling agents, any person controlling the Underwriter, its
officers or directors or any person controlling the Company, and (ii) delivery
of and payment for the Securities.
SECTION
9. Termination
of Agreement.
(a) Termination;
General.
The
Underwriter 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 (exclusive of any supplement thereto),
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, 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 or any change or development
involving a prospective change in national or international political, financial
or economic conditions, in each case the effect of which is such as to make
it,
in the judgment of the Underwriter, impracticable or inadvisable to offer,
sell
or deliver 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, 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) a
material disruption has occurred in commercial banking or securities settlement
or clearance services in the United States, or (v) if a banking moratorium
has
been declared by Federal, New York or Washington authorities.
(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 1, 6, 7 and 8 shall survive such
termination and remain in full force and effect.
SECTION
10. 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 Underwriter shall be directed to ▇▇▇▇▇▇
Brothers Inc., ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention:
Syndicate Department (Fax: ▇▇▇-▇▇▇-▇▇▇▇), with a copy, in the case of any notice
pursuant to Section 6(c), to the Director of Litigation, Office of General
Counsel, ▇▇▇▇▇▇ Brothers Inc., ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇
▇▇▇▇▇,
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (Fax: ▇▇▇-▇▇▇-▇▇▇▇).
Notices
to the Company shall be directed to ▇▇▇▇▇ ▇.▇. ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Vice President Finance &
Treasurer.
SECTION
11. Parties.
This
Agreement shall each inure to the benefit of and be binding upon the Underwriter
and 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 Underwriter and 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 Underwriter
and 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 the Underwriter shall be deemed to be a successor by reason merely of
such
purchase.
SECTION
12. No
Fiduciary Duty.
The
Company acknowledges and agrees that in connection with this offering, sale
of
the Securities or any other services the Underwriter may be deemed to be
providing hereunder, notwithstanding any preexisting relationship,
advisory or otherwise,
between
the parties or any oral representations or assurances previously or subsequently
made by the Underwriter:
(i) no
fiduciary or agency relationship between the Company and any other person,
on
the one hand, and the Underwriter, on the other, exists;
(ii) the
Underwriter is not acting as advisors, expert or otherwise, to the
Company,
including, without limitation, with respect to the determination of the public
offering price of the Securities,
and such relationship between the Company and the Underwriter is entirely and
solely commercial,
based
on arms-length negotiations; (iii)
any
duties and obligations that the Underwriter may have to the Company shall be
limited to those duties and obligations specifically stated herein;
and
(iv) the
Underwriter and their respective affiliates may have interests that differ
from
those of the Company.
The
Company hereby waives any claims that the Company may have against the
Underwriter with respect to any breach of fiduciary duty in connection with
the
offering of the Securities.
SECTION
13. Research
Independence.
The
Company acknowledges and agrees that the Underwriter's research analysts and
research department are required to be independent from its investment banking
division and is subject to certain regulations and internal policies, and that
the Underwriter's research analysts may hold and make statements or investment
recommendations and/or publish research reports with respect to the Company
and/or the offering of the Securities that differ from the views of its
investment bankers. The Company hereby waives and releases, to the fullest
extent permitted by law, any claims that the Company may have against the
Underwriter with respect to any conflict of interest that may arise from the
fact that the views expressed by its independent research analysts and research
department may be different from or inconsistent with the views or advice
communicated to the Company by the Underwriter's investment banking division.
The Company acknowledges that the Underwriter is a full service securities
firm
and as such from time to time, subject to applicable securities laws, may effect
transactions for its own account or the account of its customers and hold long
or short positions in debt or equity securities of the companies which may
be
the subject of the transactions contemplated by this Agreement.
SECTION
14. GOVERNING
LAW.
THIS
AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE
STATE OF NEW YORK.
SECTION
15. TIME.
TIME
SHALL BE OF THE ESSENCE OF THIS AGREEMENT. EXCEPT AS OTHERWISE SET FORTH HEREIN,
SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY TIME.
SECTION
16. Counterparts.
This
Agreement may be executed in any number of counterparts, each of which shall
be
deemed to be an original, but all such counterparts shall together constitute
one and the same Agreement.
SECTION
17. Effect
of Headings.
The
Section headings herein are for convenience only and shall not affect the
construction hereof.
If
the
foregoing is in accordance with your understanding of our agreement, please
sign
and return to the Company a counterpart hereof, whereupon this instrument,
along
with all counterparts, will become a binding agreement between the Underwriter
and the Company in accordance with its terms.
Very
truly yours,
PUGET
ENERGY, INC.
By
/s/
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇▇▇
▇.
▇▇▇▇▇▇
Vice
President Finance and Treasurer
CONFIRMED
AND ACCEPTED,
as
of the
date first above written:
▇▇▇▇▇▇
BROTHERS INC.
By:
/s/
▇▇▇▇▇
▇▇▇▇▇▇
Authorized
Signatory
(592430)
Exhibit
A
FORM
OF
OPINION OF COMPANY’S COUNSEL
TO
BE
DELIVERED PURSUANT TO
SECTION
5(b)
(i) Each
of
the Company and Puget Sound Energy, Inc. ("PSE") has been duly incorporated
and
is validly existing as a corporation under the laws of the State of
Washington.
(ii) Each
of
the Company and PSE 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
of
the Company and PSE is duly qualified as a foreign corporation to transact
business and is in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or leasing of
property or the conduct of business, except where the failure so to qualify
or
to be in good standing would not result in a Material Adverse
Effect.
(iv) The
Underwriting Agreement has been duly authorized, executed and delivered by
the
Company.
(v) The
Company has an authorized capitalization as set forth in the most recent
Quarterly Report on Form 10-Q, incorporated by reference into the Prospectus,
and all of the issued shares of capital stock of the Company have been duly
authorized and validly issued, are fully paid and non-assessable and conform
to
the description thereof contained in the Prospectus. Except as described in
the
Prospectus, to our knowledge, no options, warrants or other rights to purchase
or exchange any securities for shares of the Company's capital stock are
outstanding. All of the issued shares of capital stock of PSE have been duly
authorized and validly issued, are fully paid and non-assessable and are owned
directly by the Company, to our knowledge, free and clear of all liens,
encumbrances, equities or claims, except for such liens, encumbrances, equities
or claims as could not, individually or in the aggregate, reasonably be expected
to have a Material Adverse Effect.
(vi) There
are
no statutory preemptive rights under the Washington Business Corporation Law
to
subscribe for or purchase the Securities. There are no preemptive or other
rights to subscribe for or to purchase, nor any restriction upon the voting
or
transfer of, any shares of the securities pursuant to the Company's articles
of
incorporation or by-laws or, to our knowledge, any agreement or other
instrument.
(vii) To
our
knowledge, there are no contracts, agreements, or understandings between the
Company and any person granting such person the right to require the Company
to
file a registration statement under the 1933 Act with respect to any securities
of the Company owned or to be owned by such person or to require the Company
to
include such securities in the securities registered pursuant to the
Registration Statement or in any securities being registered pursuant to any
other registration statement filed by the Company under the Securities
Act.
(viii) The
Securities to be issued and sold by the Company to the Underwriter under the
Underwriting Agreement have been duly authorized and, upon payment and delivery
in accordance with the Underwriting Agreement, will be validly issued, fully
paid and non-assessable and will conform to the description thereof contained
in
the Prospectus.
(ix) 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.
(x) 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 and supporting schedules included therein or omitted
therefrom, as to which we need express no opinion) complied as to form in all
material respects with the requirements of the 1933 Act and the 1933 Act
Regulations.
(xi) The
documents incorporated by reference in the Prospectus (other than the financial
statements and supporting schedules and other financial data included therein
or
omitted therefrom, as to which we need express no opinion), when they were
filed
with the Commission, complied as to form in all material respects with the
requirements of the 1934 Act and the rules and regulations of the Commission
thereunder.
(xii) Except
as
disclosed in the Prospectus, to the best of our knowledge, there is not pending
or threatened any action, suit, proceeding, inquiry or investigation, to which
the Company or PSE is a party, or to which the property of the Company or any
subsidiary is subject, before or brought by any court or governmental agency
or
body, domestic or foreign, which would reasonably be expected to result in
a
Material Adverse Effect, or which would reasonably be expected to materially
and
adversely affect the properties or assets thereof or the consummation of the
transactions contemplated in the Underwriting Agreement or the performance
by
the Company of its obligations thereunder.
(xiii) The
information in the Prospectus under “Description of Capital Stock,” or any
caption purporting to cover such matters, in the Registration Statement under
Item 15 and, to our knowledge, in the Company's Annual Report on Form 10-K
for
the year ended December 31, 2004 under “Regulation and Rates” and “Legal
Proceedings,” to the extent that it constitutes matters of law, summaries of
legal matters, the Company’s charter and bylaws or legal proceedings, or legal
conclusions, has been reviewed by us and is correct in all material
respects.
(xiv) All
descriptions in the Registration Statement of contracts and other documents
to
which the Company or its subsidiaries are a party are accurate in all material
respects; to the best of our 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 to the Registration Statement other than those described
or
referred to therein or filed or incorporated by reference as exhibits
thereto.
(xv) No
filing
with, or authorization, approval, consent, license, order, registration,
qualification or decree of, any court or governmental authority or agency,
domestic or foreign 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, other than under the
1933 Act and the 1933 Act Regulations, which have been obtained, or as may
be
required under the securities or blue sky laws of the various
states.
(xvi) The
execution, delivery and performance of the Underwriting Agreement 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, 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 Repayment Event (as defined in
Section 1(a)(xiii) of the Underwriting Agreement) under or result in the
creation or imposition of any lien, charge or encumbrance upon any property
or
assets of the Company or PSE pursuant to any contract or any other agreement
or
instrument listed as an exhibit to the Company's Annual Report on Form 10-K
for
the year ended December 31, 2004 (except for such conflicts, breaches, defaults
or Repayment Events 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 applicable law,
statute, rule, regulation, judgment, order, writ or decree, known to us, of
any
government, government instrumentality or court, domestic or foreign, having
jurisdiction over the Company or any of its properties, assets or
operations.
(xvii) The
Company is not required, 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 required, to register as an “investment
company” under the 1940 Act.
(xviii) To
the
best of our knowledge, there are no statutes or regulations that are required
to
be described in the Prospectus that are not described as required.
(xix) To
the
best of our knowledge, the Company is not in violation of its charter or bylaws,
and no default by the Company exists in the due performance or observance of
any
obligation, agreement, covenant or condition contained in any agreement
providing for the issuance of the Company's securities or under which the
Company has outstanding indebtedness for borrowed money, except for such
defaults which would not reasonably be expected to have a Material Adverse
Effect.
Although
we assume no responsibility for the factual accuracy, completeness or fairness
of any statements made in the Registration Statement or any amendment thereto
or
the Prospectus or any amendment or supplement thereto, except as stated in
paragraphs (xi) and (xii), nothing has come to our attention that would lead
us
to believe that the Registration Statement or any amendment thereto, (except
for
financial statements and schedules and other financial data included or
incorporated by reference therein or omitted therefrom, as to which we need
make
no statement), at the time such Registration Statement or any such amendment
last became effective (as such term is used in Rule 158(c) of the 1933 Act
Regulations), 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 or any amendment or
supplement thereto (except for financial statements and schedules and other
financial data included or incorporated by reference therein or omitted
therefrom, as to which we need make no statement), at the time the Prospectus
was issued, at the time any such amended or supplemented prospectus was issued
or at the Closing Time, included or includes 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.
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 public officials. 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).