EXHIBIT 1.1
PP&L CAPITAL FUNDING, INC.
$[400,000,000]
MEDIUM-TERM NOTES, SERIES B
UNCONDITIONALLY GUARANTEED
AS TO PAYMENT OF PRINCIPAL, PREMIUM, IF ANY,
AND INTEREST BY PP&L RESOURCES, INC.
DISTRIBUTION AGREEMENT
----------------------
, 1999
-----------
[Agent Name]
[Agent Address]
[Agent Name]
[Agent Address]
[Agent Name]
[Agent Address]
Dear Sirs:
PP&L Capital Funding, Inc., a Delaware corporation (the
"Company"), and PP&L Resources, Inc., a Pennsylvania corporation
(the "Guarantor"), confirm their agreement with
-----------------------------------------------------------------
,
-----------------------------------------------------------------
(each, an
--------------------------------------------------
"Agent", and collectively, the "Agents") with respect to the
issue and sale by the Company of its Medium-Term Notes, Series B
(the "Notes"). The Notes will be unconditionally guaranteed as
to payment of principal, premium, if any, and interest by the
Guarantor pursuant to guarantees of the
Guarantor (the "Guarantees"). Certain terms of the Notes are set
forth in Schedule A hereto.
The Notes are to be issued pursuant to an Indenture,
dated as of November 1, 1997, as amended or modified from time to
time (the "Base Indenture"), among the Company, the Guarantor and
The Chase Manhattan Bank, as trustee (the "Trustee"), as
supplemented by a Supplemental Indenture No. 2, dated as of
, 1999 (the "Supplemental Indenture" and, together with
----------
the Base Indenture, the "Indenture"), among the Company, the
Guarantor and the Trustee. As of the date hereof, the Company
has authorized the issuance and sale of up to $[400,000,000]
aggregate principal amount of Notes to or through the Agents
pursuant to the terms of this Agreement. It is understood,
however, that the Company may from time to time authorize the
issuance of additional Notes and that such additional Notes may
be sold to or through the Agents pursuant to the terms of this
Agreement, all as though the issuance of such Notes were
authorized as of the date hereof.
This Agreement provides both for the sale of Notes by
the Company to one or more Agents as principal for resale to
investors and other purchasers and for the sale of Notes by the
Company directly to investors through one or more agents (as may
from time to time be agreed to by the Company and the applicable
Agent), in which case the applicable Agent will act as an agent
of the Company in soliciting offers for the purchase of Notes.
In connection with the foregoing, the Company and the
Guarantor have filed with the Securities and Exchange Commission
(the "Commission") a joint registration statement on Form S-3
(Nos. 333- and 333- -01) for the registration of debt
----- -----
securities, including the Notes and the Guarantees, under the
Securities Act of 1933, as amended (the "1933 Act") and the
offering thereof from time to time in accordance with Rule 415 of
the rules and regulations of the Commission under the 1933 Act
(the "1933 Act Regulations"). Such registration statement (as so
amended, if applicable) has been declared effective by the
Commission and the Indenture has been duly qualified under the
Trust Indenture Act of 1939, as amended (the "1939 Act"). Such
registration statement (as so amended, if applicable) is referred
to herein as the "Registration Statement"; and the final
prospectus and all applicable amendments or supplements thereto
(including the final prospectus supplement relating to the
offering of Notes), in the form first furnished to the applicable
Agent(s) and to be transmitted for filing pursuant to Rule 424(b)
of the 1933 Act Regulations, are collectively referred to herein
as the "Prospectus"; provided, however, that all references to
the "Registration Statement" and the "Prospectus" shall also be
deemed to include all documents incorporated therein by reference
pursuant to the Securities Exchange Act of 1934, as amended (the
"1934 Act"), prior to any acceptance by the Company of an offer
for the purchase of Notes; provided, further, that if the Company
files a registration statement with the Commission pursuant to
Rule 462(b) of the 1933 Act Regulations (the "Rule 462(b)
Registration Statement"), then, after such filing, all references
to the "Registration Statement" shall also be deemed to include
the Rule 462(b) Registration Statement. For purposes of this
Agreement, all references to the Registration Statement or
Prospectus or to any amendment or supplement thereto shall be
deemed to include any 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 that is
"contained," "included" or "stated" in the Registration Statement
or Prospectus (and all other references of like import) shall be
deemed to mean and include all such financial statements and
schedules and other information that are or are deemed to be
incorporated by reference in the Registration Statement or
Prospectus, as the case may be; and all references in this
Agreement to amendments or supplements to the Registration
Statement or Prospectus shall be deemed to mean and include the
filing of any document under the 1934 Act that is or is deemed to
be incorporated by reference in the Registration Statement or
Prospectus, as the case may be.
1. Appointment as Agent.
--------------------
(a) Appointment. On the basis of the representations,
-----------
warranties and agreements herein contained, but subject to the
terms and conditions herein contained and subject to the
reservation by the Company of the right to sell Notes directly to
investors on its own behalf (and not through any Agent), offers
for the purchase of Notes may be solicited by an Agent as agent
for the Company at such times and in such amounts as such Agent
deems advisable. The Company may appoint additional agents in
connection with the offering of the Notes; provided that (i) the
Company promptly notifies the Agents of such appointment and
(ii) the commission paid to any such additional agent with
respect to the sale of Notes by the Company as a result of a
solicitation made by such additional agent does not exceed that
percentage specified in Schedule B hereto of the aggregate
principal amount of such Notes sold by the Company; and provided
further that, unless the appointment of such additional agent is
expressly limited to the solicitation of offers to purchase a
specified principal amount of Notes on specified terms, such
additional agent enters into an agreement with the Company making
such agent an Agent under this Agreement or enters into an
agreement with the Company on terms which are substantially
similar to those contained in this Agreement, which agreement
shall include appropriate changes to reflect the arrangements
between the Company and such additional agent.
(b) Sale of Notes. The Company shall not sell or
-------------
approve the solicitation of offers for the purchase of Notes in
excess of the amount which shall be authorized by the Company
from time to time or in excess of the aggregate principal amount
of Notes registered pursuant to the Registration Statement. The
Agents shall have no responsibility for maintaining records with
respect to the aggregate principal amount of Notes sold, or of
otherwise monitoring the availability of Notes for sale, under
the Registration Statement.
(c) Purchases as Principal. The Agents shall not have
----------------------
any obligation to purchase Notes from the Company as principal.
However, absent an agreement between an Agent and the Company
that such Agent shall be acting solely as an agent for the
Company, such Agent shall be deemed to be acting as principal in
connection with any offering of Notes by the Company through such
Agent. Accordingly, the Agents, individually or in a syndicate,
may agree from time to time to purchase Notes from the Company as
principal for resale to investors and other purchasers determined
by such Agents. Any purchase of Notes from the Company by an
Agent as principal shall be made in accordance with Section 3(a)
hereof.
(d) Solicitations as Agent. If agreed upon between an
----------------------
Agent and the Company, such Agent, acting solely as an agent for
the Company and not as principal, will solicit offers for the
purchase of Notes. Such Agent will communicate to the Company,
orally or in writing, each offer for the purchase of Notes
solicited by it on an agency basis other than those offers
rejected by such Agent. Such Agent shall have the right, in its
discretion reasonably exercised, to reject any offer for the
purchase of Notes, in whole or in part, and any such rejection
shall not be deemed a breach of its agreement contained herein.
The Company may accept or reject any offer for the purchase of
Notes, in whole or in part. Such Agent shall make reasonable
efforts to assist the Company in obtaining performance by each
purchaser whose offer for the purchase of Notes has been
solicited by it on an agency basis and accepted by the Company.
Such Agent shall not have any liability to the Company in the
event that any such purchase is not consummated for any reason.
If the Company shall default on its obligation to deliver Notes
against payment tendered by a purchaser whose offer has been
solicited by such Agent on an agency basis and accepted by the
Company, the Company shall hold such Agent harmless against any
loss, claim or damage arising from or as a result of such default
by the Company.
(e) Reliance. The Company and the Agents agree that
--------
any Notes purchased from the Company by one or more Agents as
principal shall be purchased, and any Notes the placement of
which an Agent arranges as an agent of the Company shall be
placed by such Agent, in reliance on the representations,
warranties, covenants and agreements of the Company contained
herein and on the terms and conditions and in the manner provided
herein.
2. Representations and Warranties.
------------------------------
(a) The Company and the Guarantor jointly and
severally represent and warrant to, and agree with, each Agent as
of the date hereof, as of the date of each acceptance by the
Company of an offer for the purchase of Notes (whether to such
Agent as principal or through such Agent as agent), as of the
date of each delivery of Notes (whether to such Agent as
principal or through such Agent as agent) (the date of each such
delivery to such Agent as principal is referred to herein as a
"Settlement Date"), and as of any time that the Registration
Statement or the Prospectus shall be amended or supplemented
(each of the times referenced above is referred to herein as a
"Representation Date"), that:
(i) The Registration Statement, when it became
effective and at each Representation Date, and the
Prospectus and any amendment or supplement thereto, when
filed or transmitted for filing with the Commission and at
each Representation Date, complied or will comply in all
material respects with the requirements of the 1933 Act and
the 1933 Act Regulations and the 1939 Act and the rules and
regulations of the Commission under the 1939 Act (the "1939
Act Regulations"), and did not or 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; provided, however, that
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 the information furnished to the
Company in writing by the Agents expressly for use in the
Registration Statement or Prospectus or to that part of the
Registration Statement which constitutes the Trustee's
Statement of Eligibility and Qualification under the 1939
Act (the "T-1").
(ii) The documents incorporated or deemed to be
incorporated by reference in the Registration Statement or
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 under the 1934
Act (the "1934 Act Regulations"), and, when read together
with the other information in the Prospectus, at the date
hereof, at the date of the Prospectus and at each
Representation Date, 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, in the light of the circumstances under
which they were made, not misleading; provided, however,
that 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 information furnished to the Company
in writing by or through any Agent expressly for use in the
Registration Statement or Prospectus.
(iii) The Guarantor has been duly incorporated and is
validly existing as a corporation in good standing under the
laws of the Commonwealth of Pennsylvania with corporate
power and authority to enter into and perform its
obligations under this Agreement, the Indenture and the
Guarantees.
(iv) The Company has been duly incorporated and is
validly existing as a corporation in good standing under the
laws of the State of Delaware with corporate power and
authority to conduct its business as described in the
Prospectus and to enter into and perform its obligations
under this Agreement, the Indenture and the Notes; and the
Company is and will be treated as a consolidated subsidiary
of the Guarantor pursuant to generally accepted accounting
principles.
(v) Neither the Guarantor nor the Company is an
"investment company" that is required to be registered under
the Investment Company Act of 1940, as amended (the "1940
Act").
(vi) This Agreement has been duly authorized, executed
and delivered by each of the Company and the Guarantor.
(vii) The Indenture has been duly authorized, executed
and delivered by the Company and the Guarantor and, assuming
due authorization, execution and delivery by the Trustee,
constitutes a valid and binding agreement of the Company and
the Guarantor enforceable in accordance with its terms
except to the extent that enforcement thereof may be limited
by bankruptcy, insolvency, fraudulent transfer, or
reorganization, moratorium, and other similar laws relating
to or affecting the enforcement of creditors' rights and by
general equity principles, regardless of whether enforcement
is considered in a proceeding at law or in equity (the
"Bankruptcy Exceptions"); the Indenture conforms and will
conform in all material respects to the statements relating
thereto contained in the Prospectus; and at the effective
date of the Registration Statement, the Indenture was duly
qualified under the 1939 Act.
(viii) The Notes have been duly authorized and, when
issued, authenticated and delivered in the manner provided
for in the Indenture and delivered against payment of the
consideration therefor, will constitute valid and binding
obligations of the Company enforceable in accordance with
their terms except to the extent that enforcement thereof
may be limited by the Bankruptcy Exceptions; the Notes will
be in the forms established pursuant to, and entitled to the
benefits of, the Indenture; and the Notes will conform in
all material respects to the statements relating thereto
contained in the Prospectus.
(ix) The Guarantees have been duly authorized and,
when duly executed pursuant to the Indenture and delivered,
will constitute valid and binding obligations of the
Guarantor enforceable in accordance with their terms except
to the extent that enforcement thereof may be limited by the
Bankruptcy Exceptions; the Guarantees will be in the forms
established pursuant to the Indenture; and the Guarantees
will conform in all material respects to the statements
relating thereto contained in the Prospectus.
(x) Since the respective dates as of which information
is given in the Registration Statement and the Prospectus,
except as otherwise stated therein or contemplated thereby,
there has been no event or occurrence that would result in a
material adverse change, or any development involving a
material adverse change, in the financial position or
results of operations of the Guarantor and its subsidiaries
considered as one enterprise (a "Material Adverse Effect").
(xi) The Medium-Term Note Program under which the
Notes are issued (the "Program"), as well as the Notes, are
rated Baa2 by ▇▇▇▇▇'▇ Investors Service, Inc. and BBB+ by
Standard & Poor's Ratings Service, or such other rating as
to which the Company or the Guarantor shall have most
recently notified the Agents pursuant to Section 5(a)
hereof.
(b) Each of the several Agents represents and warrants
to, and agrees with, the Company and the Guarantor, their
respective directors and such of their respective officers who
shall have signed the Registration Statement, and to each other
Agent, that the information furnished in writing to the Company
and the Guarantor by such Agent expressly for use in the
Registration Statement or the Prospectus does not contain an
untrue statement of a material fact and does not omit to state a
material fact in connection with such information required to be
stated therein or necessary to make such information not
misleading.
(c) Additional Certifications. Any certificate signed
-------------------------
by any officer of the Company or the Guarantor and delivered to
one or more Agents or to counsel for the Agents in connection
with an offering of Notes to one or more Agents as principal or
through an Agent as agent shall be deemed a representation and
warranty by the Company or the Guarantor, as the case may be, to
such Agent or Agents as to the matters covered thereby on the
date of such certificate.
3. Purchases as Principal; Solicitations as Agent.
----------------------------------------------
(a) Purchases as Principal. Notes purchased from the
----------------------
Company by the Agents, individually or in a syndicate, as
principal shall be made in accordance with terms agreed upon
between such Agent or Agents and the Company in a separate
agreement (which may be an oral agreement confirmed in writing
between the applicable Agent and the Company). Each such
separate agreement is herein referred to as a "Terms Agreement".
Each such Terms Agreement, whether oral (and confirmed in
writing, which may be a facsimile transmission) or in writing,
shall include such information (as applicable) as is specified in
Schedule A hereto. An Agent's commitment to purchase Notes as
principal shall be deemed to have been made on the basis of the
representations, warranties and agreements of the Company herein
contained, but subject to the terms and conditions herein
contained. Unless the context otherwise requires, references
herein to "this Agreement" shall include the applicable Terms
Agreement of one or more Agents to purchase Notes from the
Company as principal. Each purchase of Notes, unless otherwise
agreed, shall be at a discount from the principal amount of each
such Note equivalent to the applicable commission set forth in
Schedule B hereto. The Agents may engage the services of any
broker or dealer in connection with the resale of the Notes
purchased by them as principal and may allow all or any portion
of the discount received from the Company in connection with such
purchases to such brokers or dealers. At the time of each Terms
Agreement to purchase Notes from the Company by one or more
Agents as principal, such Agent or Agents shall specify the
requirements for the comfort letter, opinions of counsel and
officers' certificate pursuant to Section 8 hereof.
(b) Solicitations as Agent. On the basis of the
----------------------
representations, warranties and agreements herein contained, but
subject to the terms and conditions herein contained, when agreed
by the Company and an Agent, such Agent, as an agent of the
Company, will use its reasonable efforts to solicit offers for
the purchase of Notes upon the terms set forth in the Prospectus.
The Agents are not authorized to appoint sub-agents with respect
to Notes sold through them as agent. All Notes sold through an
Agent as agent will be sold at 100% of their principal amount
unless otherwise agreed upon between the Company and such Agent.
The Company reserves the right, in its sole discretion,
to suspend solicitation of offers for the purchase of Notes
through an Agent, as an agent of the Company, commencing at any
time for any period of time or permanently. As soon as
practicable after receipt of instructions from the Company, such
Agent will suspend solicitation of offers for the purchase of
Notes from the Company until such time as the Company has advised
such Agent that such solicitation may be resumed.
The Company agrees to pay each Agent a commission, in
the form of a discount, equal to the applicable percentage of the
principal amount of each Note sold by the Company as a result of
a solicitation made by such Agent, as an agent of the Company, at
the time of settlement of any such sale, as set forth in
Schedule B hereto.
(c) Administrative Procedures. The purchase price,
-------------------------
interest rate or formula, maturity date and other terms of the
Notes specified in Schedule A hereto (as applicable) shall be
agreed upon between the Company and the applicable Agent(s) and
specified in a pricing supplement to the Prospectus (each, a
"Pricing Supplement") to be prepared by the Company in connection
with each sale of Notes. Except as otherwise specified in the
applicable Pricing Supplement, the Notes will be issued in
denominations of $1,000 or any larger amount that is an integral
multiple of $1,000. Administrative procedures with respect to
the issuance and sale of the Notes (the "Procedures") shall be
agreed upon from time to time among the Company, the Agents and
the Trustee. The initial Procedures, which are set forth in
Schedule C hereto, shall remain in effect until changed by
agreement among the Company, the Agents and the Trustee. The
Agents and the Company agree to perform, and the Company agrees
to request the Trustee to perform, their respective duties and
obligations specifically provided to be performed by them in the
Procedures.
4. Delivery and Payment for Notes Sold through an Agent as Agent.
-------------------------------------------------------------
Delivery of Notes sold through an Agent as an agent of
the Company shall be made by the Company to such Agent for the
account of any purchaser only against payment therefor in
immediately available funds. In the event that a purchaser shall
fail either to accept delivery of or to make payment for a Note
on the date fixed for settlement, such Agent shall promptly
notify the Company and deliver such Note to the Company and, if
such Agent has theretofore paid the Company for such Note, the
Company will promptly return such funds to such Agent. If such
failure has occurred for any reason other than default by such
Agent in the performance of its obligations hereunder, the
Company will reimburse such Agent on an equitable basis for its
loss of the use of the funds for the period such funds were
credited to the Company's account.
5. Certain Covenants of the Company and the Guarantor.
--------------------------------------------------
Each of the Company and the Guarantor jointly and
severally covenant with the several Agents as follows:
(a) To notify the Agents promptly, and confirm the
notice in writing, of (i) any request by the Commission for any
amendment to the Registration Statement or any amendment or
supplement to the Prospectus or for additional information, (ii)
the institution by the Commission of any stop order proceedings
in respect of the Registration Statement, or the initiation of
proceedings for that purpose, and to make every reasonable effort
to prevent the issuance of any such stop order and to obtain as
soon as possible its lifting, if issued, and (iii) any change in
the rating assigned by any nationally recognized statistical
rating organization to the Program or any debt securities
(including the Notes) of the Company or the Guarantor, or the
public announcement by any nationally recognized statistical
rating organization that it has under surveillance or review,
with possible negative implications, its rating of the Program or
any such debt securities, or the withdrawal by any nationally
recognized statistical rating organization of its rating of the
Program or any such debt securities;
(b) To advise the Agents, or ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ as
counsel to the Agents, promptly of any such filing, and to advise
the Agents, or ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, as counsel to the Agents,
promptly of any proposal to file or prepare (i) any amendment to
the Registration Statement (including any post-effective
amendment), (ii) any amendment or supplement to the Prospectus
(other than an amendment or supplement providing solely for the
determination of the variable terms of the Notes or relating
solely to the offering of securities other than the Notes), or
(iii) any document that would as a result thereof be incorporated
by reference in the Prospectus whether pursuant to the 1933 Act,
the 1934 Act or otherwise; and will furnish the Agents with
copies of any such amendment, supplement or other document a
reasonable amount of time prior to such proposed filing or use,
as the case may be;
(c) To endeavor, in cooperation with the Agents, to
qualify the Notes for offer and sale under the securities or blue
sky laws of such states and the other jurisdictions of the United
States as the Agents may from time to time designate, to continue
such qualifications in effect so long as required for the
distribution of the Notes and to reimburse the Agents for any
expenses (including filing fees and reasonable fees and
disbursements of counsel) paid by the Agents or on their behalf
to qualify the Notes for offer and sale, to continue such
qualification, to determine the eligibility of the Notes for
investment and to print the memoranda relating thereto; provided
that neither the Company nor the Guarantor shall be required to
qualify as a foreign corporation in any jurisdiction in which it
is not so qualified, to consent to service of process in any
jurisdiction other than with respect to claims arising out of the
offering or sale of the Notes, or to meet any other requirement
in connection with this paragraph (c) deemed by them to be unduly
burdensome;
(d) To deliver promptly to the Agents signed copies of
the Registration Statement as originally filed and of all
amendments thereto heretofore or hereafter filed, including
conformed copies of all exhibits except those incorporated by
reference, and such number of conformed copies of the
Registration Statement (but excluding the exhibits), the
Prospectus, and any amendments and supplements thereto, as the
Agents may reasonably request;
(e) To prepare, with respect to any Notes to be sold
to or through one or more Agents pursuant to this Agreement, a
Pricing Supplement with respect to such Notes in a form
previously approved by the Agents. The Company will deliver such
Pricing Supplement no later than 11:00 A.M., New York City time,
on the business day following the date of the Company's
acceptance of the offer for the purchase of such Notes and will
file such Pricing Supplement pursuant to Rule 424(b)(3) under the
1933 Act not later than the close of business of the Commission
on the fifth business day after the date on which such Pricing
Supplement is first used;
(f) Except as otherwise provided in subsection (l) of
this Section 5, if at any time during the term of this Agreement
any event occurs as a result of which the Prospectus, as then
amended or supplemented, would include an untrue statement of a
material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein, in
the light of the circumstances existing at the time the
Prospectus is delivered to a purchaser, not misleading, or if it
shall be necessary at any time to amend the Registration
Statement or amend or supplement the Prospectus to comply with
the 1933 Act or the 1933 Act Regulations, to advise the Agents
immediately, confirmed in writing, to cease the solicitation of
offers for the purchase of Notes in their capacity as agents and
to cease sales of any Notes they may then own as principal, and
to promptly prepare and file with the Commission, subject to
Section 5(b) hereof, such amendment or supplement which will
correct such statement or omission or an amendment which will
effect such compliance; provided, however, that the cost of any
amendment or supplement which relates solely to the activities of
any Agent shall be borne by the Agent or Agents requiring the
same;
(g) Except as otherwise provided in subsection (l) of
this Section 5, on or prior to the date on which there shall be
released to the general public interim financial statement
information related to the Company or the Guarantor with respect
to each of the first three quarters of any fiscal year or
preliminary financial statement information with respect to any
fiscal year, or financial information included in the audited
consolidated financial statements of the Company or the Guarantor
for the preceding fiscal year, the Company and the Guarantor
shall furnish such information to the Agents;
(h) As soon as practicable, the Guarantor will make
generally available to its security holders an earnings statement
covering a period of at least twelve months beginning after the
"effective date of the registration statement" within the meaning
of Rule 158 under the 1933 Act which will satisfy the provisions
of Section 11(a) of the 1933 Act;
(i) The Company and the Guarantor 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 Sections 13(a), 13(c), 14 or 15(d) of the
1934 Act within the time periods prescribed by the 1934 Act and
the 1934 Act Regulations;
(j) Unless otherwise agreed upon between one or more
Agents acting as principal and the Company, between the date of
any Terms Agreement by such Agent(s) to purchase Notes from the
Company and the Settlement Date with respect thereto, the Company
will not, without the prior written consent of such Agent(s),
issue, sell, offer or contract to sell, grant any option for the
sale of, or otherwise dispose of, any debt securities of the
Company with maturities and other terms substantially similar to
the Notes being sold pursuant to such Terms Agreement (other than
the Notes that are to be sold pursuant to such Terms Agreement,
notes to banks under the Revolving Credit Agreement of the
Company or commercial paper in the ordinary course of business);
(k) The Company will apply the net proceeds from the
sale of the Notes for the purposes set forth in the Prospectus;
(l) The Company shall not be required to comply with
the provisions of subsections (f) or (g) of this Section 5 during
any period from the time the Agents shall have suspended
solicitation of offers for the purchase of Notes in their
capacity as agents pursuant to a request from the Company until
the time the Company shall determine that solicitation of offers
for the purchase of Notes should be resumed; provided, however,
that compliance with such subsections shall be required for any
portion of such period during which an Agent shall hold any Notes
as principal purchased pursuant to a Terms Agreement; and
provided further that the Agents shall, upon inquiry by the
Company or the Guarantor, advise the Company and the Guarantor
whether or not any of them retains any Notes for purposes of this
subsection (l), and from the 30th day immediately following the
issuance of such Notes, unless otherwise advised by an Agent, the
Company and the Guarantor shall be entitled to assume that the
distribution of such Notes is complete; and
(m) The Company will comply with the conditions set
forth in Rule 3a-5 under the 1940 Act ("Rule 3a-5"), necessary
for the Company to not be considered an "investment company"
under the 1940 Act.
6. Payment of Expenses.
-------------------
The Company will pay or bear (i) all expenses in
connection with the matters herein required to be performed by
the Company or the Guarantor, including all expenses in
connection with the preparation and filing of the Registration
Statement and the Prospectus, and any amendment or supplement
thereto, and the furnishing of copies thereof to the Agents, and
all audits, statements or reports in connection therewith, and
all expenses in connection with the issue and delivery of the
Notes and the related Guarantees, including the reasonable fees
and disbursements of counsel to the Agents incurred in connection
with the establishment of the Program and incurred from time to
time in connection with the transactions contemplated hereby, any
fees and expenses relating to the eligibility and issuance of
Notes in book-entry form and the cost of obtaining CUSIP or other
identification numbers for the Notes, all Federal and State taxes
(if any) payable (not including any transfer taxes) upon the
issue of the Notes or the related Guarantees, any fee charged by
securities ratings services for rating the Program and the Notes,
the fees and expenses incurred in connection with any listing of
the Notes on a securities exchange, and the fee of the National
Association of Securities Dealers, Inc., if any, and (ii) all
expenses in connection with the printing, reproduction and
delivery of this Agreement and the printing, reproduction and
delivery of such other documents or certificates as may be
required in connection with the offering, purchase, sale,
issuance or delivery of the Notes or the Guarantees.
7. Conditions of Agents' Obligations.
---------------------------------
The obligations of one or more Agents to purchase Notes
as principal and to solicit offers for the purchase of Notes as
an agent of the Company, and the obligations of any purchasers of
Notes sold through an Agent as an agent of the Company, will be
subject to the following conditions:
(a) The Agents shall have received from Price
Waterhouse LLP a letter, dated the date of this Agreement, in
form and substance satisfactory to you, to the effect that:
(i) They are independent accountants with respect to
the Guarantor and its subsidiaries within the meaning of the
1933 Act and the 1933 Act Regulations;
(ii) their opinion, the consolidated financial
statements of the Guarantor and its subsidiaries audited by
them and incorporated by reference in the Registration
Statement comply as to form in all material respects with
the applicable accounting requirements of the 1933 Act and
the 1934 Act and the published rules and regulations
thereunder with respect to registration statements on Form
S-3;
(iii) the basis of procedures (but not an audit in
accordance with generally accepted auditing standards)
consisting of:
(A) Reading the minutes of meetings of the
shareowners and the Boards of Directors of the
Guarantor and the Company and their Executive,
Compensation and Corporate Governance, Finance and the
Audit and Corporate Responsibility Committees since the
day after the end of the last audited period 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) With respect to the unaudited
consolidated balance sheet as of the most recent
quarter ended and the unaudited consolidated statements
of income and of cash flows included in the Guarantor's
Quarterly Report on Form 10-Q for the most recent
quarter ended ("Form 10-Q") incorporated by reference
in the Registration Statement,
(i) Performing the procedures specified by the
American Institute of Certified Public Accountants for a
review of interim financial information as described in SAS
No. 71, Interim Financial Information, on the unaudited
-----------------------------
consolidated balance sheet and the unaudited consolidated
statements of income and of cash flows for the most recent
quarter ended and year to date, and prior year periods,
included in the Guarantor's Form 10-Q incorporated by
reference in the Registration Statement;
(ii) Making inquiries of certain officials of the
Guarantor who have responsibility for financial and
accounting matters as to whether the unaudited consolidated
financial statements referred to in (B)(i) comply as to form
in all material respects with the applicable accounting
requirements of the 1934 Act, as it applies to Form 10-Q and
the related published rules and regulations thereunder;
(C) Reading the unaudited interim financial
data for the period from the date of the latest balance
sheet included or incorporated in the Registration
Statement to the date of the latest available interim
financial data; and
(D) Making inquiries of certain officials of
the Guarantor who have responsibility for financial and
accounting matters regarding the specific items for
which representations are requested below;
nothing has come to their attention as a result of the
foregoing procedures that caused them to believe that
(i) the unaudited consolidated financial statements
described in (B)(i), included in the Form 10-Q and
incorporated by reference in the Registration
Statement, do not comply as to form in all material
respects with the applicable accounting requirements of
the 1933 Act and the 1934 Act, as it applies to
Form 10-Q, and the related published rules and
regulations thereunder; or (ii) any material
modifications should be made to the unaudited
consolidated financial statements described in (B)(i),
included in the Form 10-Q and incorporated by reference
in the Registration Statement, for them to be in
conformity with generally accepted accounting
principles; or (iii) 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, there was any change in the
capital stock (except for changes in shares of certain
series of preferred stock of a subsidiary of the
Guarantor redeemed for, purchased or otherwise retired
in anticipation of, sinking fund requirements for such
series or as a result of the surrender by the Guarantor
of any preferred stock of PP&L, Inc. theretofore
purchased by the Guarantor), or increase in long-term
debt of the Guarantor and subsidiaries consolidated as
compared with amounts shown in the latest balance sheet
incorporated by reference in the Registration Statement
or (iv) for the period from the closing date of the
latest consolidated income statement incorporated by
reference in the Registration Statement to the date of
the latest available interim financial data there were
any decreases, as compared with the corresponding
period in the preceding year, in net income, except in
all instances for changes, increases or decreases which
the Registration Statement, including the documents
incorporated therein by reference, discloses have
occurred or may occur, or they shall state any specific
changes or decreases.
(iv) The letter shall also state that the information
set forth in Schedule D hereto, which is expressed in
dollars (or percentages derived from such dollar amounts)
and has been obtained from accounting records which are
subject to the internal controls of the Guarantor's
accounting system or which has been derived directly from
such accounting records by analysis or computation, is in
agreement with such records or computations made therefrom,
except as otherwise specified in such letter.
(b) The Registration Statement has become effective
under the 1933 Act and no stop order suspending the effectiveness
of the Registration Statement shall have been issued and no
proceedings for that purpose shall have been instituted, or, to
the knowledge of the Company or the Guarantor, shall be
contemplated by the Commission and the Agents shall have received
certificates of the Company and of the Guarantor dated the date
hereof to such effect.
(c) On the date hereof the Agents shall have received
from ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq., Senior Counsel, or such other
counsel for the Company and the Guarantor as may be acceptable to
you, an opinion, dated as of the date hereof, in form and
substance satisfactory to counsel for the Agents, to the effect
that:
(i) The Guarantor has been duly incorporated and is
validly existing as a corporation in good standing under the
laws of the Commonwealth of Pennsylvania with power and
authority (corporate and other) to own its properties and
conduct its business as described in the Prospectus;
(ii) The portions of the information contained in the
Prospectus, which are stated therein to have been made on
the authority of any such counsel, have been reviewed by
such counsel and, as to matters of law and legal
conclusions, are correct;
(iii) The Guarantor is a "holding company" within the
meaning of the Public Utility Holding Company Act of 1935,
as amended, but is exempt from such Act (except for the
provisions of Section 9(a)(2) thereof) by virtue of an order
of the Commission pursuant to Section 3(a)(1) thereof;
(iv) The descriptions in the Registration Statement
and the Prospectus of statutes, legal and governmental
proceedings and contracts and other documents are accurate
and fairly present the information required to be shown; and
such counsel does not know of any legal or governmental
proceedings required to be described in the Registration
Statement or Prospectus which are not described, or of any
contracts or documents of a character required to be
described in the Registration Statement or the Prospectus or
to be filed as exhibits to the Registration Statement which
are not described and filed as required; it being understood
that such counsel need express no opinion as to the
financial statements and other financial data contained or
incorporated by reference in the Registration Statement or
the Prospectus;
(v) This Agreement has been duly authorized, executed
and delivered by the Guarantor;
(vi) The Indenture has been duly authorized, executed
and delivered by the Guarantor and, assuming due
authorization, execution, and delivery by the Company and
the Trustee, is a valid and binding obligation of the
Guarantor, enforceable in accordance with its terms, except
to the extent limited by the Bankruptcy Exceptions;
(vii) The Guarantees are in the form established
pursuant to the Indenture, have been duly authorized by the
Guarantor, and, when duly executed pursuant to the Indenture
and delivered in accordance with the provisions of this
Agreement, will constitute valid and binding obligations of
the Guarantor, as guarantor, enforceable in accordance with
their terms, except to the extent limited by the Bankruptcy
Exceptions;
(viii) No approval, authorization, consent or other
order of any public board or body is legally required for
the authorization of the offering, issuance and sale of the
Notes, except (a) such as may be required under the 1933 Act
or the 1933 Act Regulations or the securities or "blue sky"
laws of any jurisdiction and (b) the qualification of the
Indenture under the 1939 Act and 1939 Act Regulations.
In rendering such opinion, such counsel may rely
as to matters governed by New York law upon the opinion of
▇▇▇▇▇▇ ▇▇▇▇ & Priest LLP referred to in Section 7(d) of this
Agreement.
(d) On the date hereof, the Agents shall have received
from ▇▇▇▇▇▇ ▇▇▇▇ & Priest LLP, special counsel to the Company and
the Guarantor, an opinion, dated as of the date hereof, in form
and substance satisfactory to counsel for the Agents, to the
effect that:
(i) The Company has been duly incorporated and is
validly existing as a corporation in good standing under the
laws of the State of Delaware;
(ii) The Notes are in the form established pursuant to
the Indenture, have been duly authorized by the Company,
and, when issued, authenticated and delivered in the manner
provided for in the Indenture and delivered against payment
therefor, will constitute valid and binding obligations of
the Company enforceable in accordance with their terms,
except to the extent limited by the Bankruptcy Exceptions,
and are entitled to the benefits of the Indenture;
(iii) The Guarantees are in the form established
pursuant to the Indenture, have been duly authorized by the
Guarantor, and, when duly executed pursuant to the Indenture
and delivered in accordance with the provisions of this
Agreement, will constitute valid and binding obligations of
the Guarantor, as guarantor, enforceable in accordance with
their terms, except to the extent limited by the Bankruptcy
Exceptions;
(iv) This Agreement has been duly authorized, executed
and delivered by each of the Guarantor and the Company;
(v) The Indenture has been duly authorized, executed
and delivered by the Company and the Guarantor and, assuming
due authorization, execution, and delivery by the Trustee,
is a valid and binding obligation of the Company and the
Guarantor, enforceable in accordance with its terms, except
to the extent limited by the Bankruptcy Exceptions; and the
Indenture has been duly qualified under the 1939 Act;
(vi) The Registration Statement has become effective
under the 1933 Act and any required filing of the Prospectus
pursuant to Rule 424(b) has been made in the manner and
within the time period required, and, to the best of the
knowledge of such counsel, no stop order suspending the
effectiveness of the Registration Statement or any part
thereof has been issued and no proceedings for that purpose
have been instituted or are pending or contemplated under
the 1933 Act, and the Registration Statement, as of its
effective date, and any amendment thereto, as of its date,
and the Prospectus, as of its date, and each amendment or
supplement thereto, as of its date, complied as to form in
all material respects with the requirements of the 1933 Act
and the 1933 Act Regulations, and nothing has come to the
attention of such counsel which would lead such counsel to
believe either that the Registration Statement or any
amendment thereto, as of such dates, contained any untrue
statement of a material fact or omitted to state any
material fact required to be stated therein or necessary to
make the statements therein not misleading, or that the
Prospectus or any amendment or supplement thereto, as of the
date issued or the date of such opinion, contained or
contains any untrue statement of a material fact or omitted
or omits to state any material fact necessary to make the
statements therein, in the light of the circumstances under
which they were made, not misleading; it being understood
that such counsel need express no opinion as to the
financial statements and other financial or statistical data
contained or incorporated by reference in the Registration
Statement or the Prospectus;
(vii) The statements in the Prospectus under the
captions "Description of the Debt Securities" and
"Description of Notes", insofar as they purport to
constitute summaries of certain terms of the Indenture, the
Notes and the Guarantees, in each case constitute accurate
summaries of such terms of such documents and securities, in
all material respects;
(viii) The Company is a "finance subsidiary" within
the meaning of Rule 3a-5 of the 1940 Act, and the Guarantees
satisfy the conditions of clauses (a)(1) and (3) of Rule
3a-5. Assuming that the Company continues to qualify as a
"finance subsidiary" within the meaning of Rule 3a-5,
satisfies the conditions of clauses (a)(5) and (6) of Rule
3a-5 and satisfies the conditions of Rule 3a-5 in respect of
any securities other than the Notes issued by the Company,
upon giving effect to the transactions contemplated by this
Agreement, the Prospectus and the application of the
proceeds from the sale of the Notes contemplated in the
Prospectus, the Company will not be an "investment company"
within the meaning of the 1940 Act. The Guarantor is not an
"investment company" within the meaning of the 1940 Act; and
(ix) No approval, authorization, consent or other
order of any public board or body is legally required under
federal or New York law for the authorization of the
offering, issuance and sale of the Notes, except (a) such as
may be required under the 1933 Act or the 1933 Act
Regulations or the securities or "blue sky" laws of any
jurisdiction and (b) the qualification of the Indenture
under the 1939 Act and 1939 Act Regulations.
In rendering their opinion, ▇▇▇▇▇▇ ▇▇▇▇ & Priest LLP
may rely as to matters governed by Pennsylvania law upon the
opinion of ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq., or such other counsel
referred to in Section 7(c) of this Agreement.
(x) The statements in the Prospectus, under the
caption "Certain United States Federal Income Tax
Considerations" constitute an accurate description, in
general terms, of certain tax considerations that may be
relevant to a holder of a Note.
(e) On the date hereof, the Agents shall have received
from ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, counsel for the Agents, such opinion or
opinions, dated as of the date hereof, with respect to the
validity of the Notes and the Guarantees, this Agreement, the
Registration Statement, the Prospectus and other related matters
as the Agents may require, and the Company and the Guarantor
shall have furnished to such counsel such documents as they
request for the purpose of enabling them to pass upon such
matters. In rendering such opinion or opinions, ▇▇▇▇▇▇▇▇ &
▇▇▇▇▇▇▇▇ may assume the due incorporation and valid existence of
the Company and the Guarantor and may rely as to matters governed
by Pennsylvania law upon the opinion of ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
or such other counsel for the Company and the Guarantor referred
to in Section 7(c) of this Agreement.
(f) On the date hereof, the Agents shall have received
certificates, dated the date hereof, of the President or a Vice
President and a financial or accounting officer of the Guarantor
and of a Vice President or Treasurer of the Company in which such
officers, to the best of their knowledge after reasonable
investigation, shall state that (i) the representations and
warranties of the Company or the Guarantor, as the case may be,
in this Agreement are true and correct (except for immaterial
details) as of the date of such certificate, (ii) the Company or
Guarantor, as the case may be, has complied with all agreements
and satisfied all conditions on its part to be performed or
satisfied at or prior to the date of such certificate, (iii) 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 by the Commission, and (iv)
subsequent to the date of the latest financial statements in the
Prospectus, there has been no Material Adverse Effect, whether or
not arising in the ordinary course of business, except as set
forth or contemplated in the Prospectus or as described in such
certificate.
In case any such condition shall not have been
satisfied, this Agreement may be terminated by the applicable
Agent or Agents upon notice in writing or by telegram to the
Company and the Guarantor without liability or obligation of any
party, except as provided in Sections 5(c), 6, 9, 11, 12 and 14
hereof.
8. Additional Covenants of the Company and the Guarantor.
-----------------------------------------------------
The Company and the Guarantor further covenant and
agree with each Agent as follows:
(a) Reaffirmation of Representations and Warranties.
-----------------------------------------------
Each acceptance by the Company of an offer for the purchase of
Notes (whether to one or more Agents as principal or through an
Agent as agent), and each delivery of Notes (whether to one or
more Agents as principal or through an Agent as Agent), shall be
deemed to be an affirmation that the representations and
warranties of the Company and the Guarantor herein contained and
contained in any certificate delivered therewith to the Agents
pursuant to this Agreement are true and correct at the time of
such acceptance or sale, as the case may be (it being understood
that such representations and warranties shall relate to the
Registration Statement and Prospectus as amended and supplemented
to each such time).
(b) Subsequent Delivery of Certificates. Each time
-----------------------------------
that (i) the Registration Statement or the Prospectus shall be
amended or supplemented (other than by an amendment or supplement
providing solely for the determination of the variable terms of
the Notes or relating solely to the offering of securities other
than the Notes) or (ii) (if required by the Terms Agreement
relating to such Notes) the Company sells Notes to one or more
Agents as principal, each of the Company and the Guarantor shall
furnish or cause to be furnished to the Agent(s), forthwith a
certificate dated the date of filing with the Commission or the
date of effectiveness of such amendment or supplement, as
applicable, or the date of such sale, as the case may be, in form
satisfactory to the Agent(s) to the effect that the statements
contained in the certificate referred to in Section 7(f) hereof
which were last furnished to the Agents are true and correct at
the time of the filing or effectiveness of such amendment or
supplement, as applicable, or the time of such sale, as the case
may be, as though made at and as of such time (except that such
statements shall be deemed to relate to the Registration
Statement and the Prospectus as amended and supplemented to such
time) or, in lieu of such certificate, a certificate of the same
tenor as the certificate referred to in Section 7(f) hereof,
modified as necessary to relate to the Registration Statement and
the Prospectus as amended and supplemented to the time of
delivery of such certificate (it being understood that, in the
case of clause (ii) above, any such certificates shall also
include a certification that there has been no Material Adverse
Effect since the date of the agreement by such Agent(s) to
purchase Notes from the Company as principal).
(c) Subsequent Delivery of Legal Opinions. Each time
-------------------------------------
that (i) the Registration Statement or the Prospectus shall be
amended or supplemented (other than (A) by an amendment or
supplement providing solely for the determination of the variable
terms of the Notes or relating solely to the offering of
securities other than the Notes or (B) unless an Agent shall
otherwise reasonably request, by filing of any Current Report on
Form 8-K) or (ii) (if required by the Terms Agreement relating to
such Notes) the Company sells Notes to one or more Agents as
principal, the Company shall furnish or cause to be furnished
forthwith to the Agent(s) and to counsel to the Agents the
written opinions of ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq., Senior Counsel to
the Guarantor (or such other counsel as may be acceptable to the
Agent(s)) and ▇▇▇▇▇▇ ▇▇▇▇ & Priest LLP, special counsel to the
Company and the Guarantor, each dated the date of filing with the
Commission or the date of effectiveness of such amendment or
supplement, as applicable, or the date of such sale, as the case
may be, in form and substance satisfactory to the Agent(s), of
the same tenor as the opinions referred to in Section 7(c) and
(d) hereof, but modified, as necessary, to relate to the
Registration Statement and the Prospectus as amended and
supplemented to the time of delivery of such opinions; or, in
lieu of such opinions, counsel last furnishing such opinions to
the Agents shall furnish the Agent(s) with a letter substantially
to the effect that the Agent(s) may rely on such last opinion to
the same extent as though it was dated the date of such letter
authorizing reliance (except that statements in such last opinion
shall be deemed to relate to the Registration Statement and the
Prospectus as amended and supplemented to the time of delivery of
such letter authorizing reliance).
(d) Subsequent Delivery of Comfort Letters. Each time
--------------------------------------
that (i) the Registration Statement or the Prospectus shall be
amended or supplemented to include additional financial
information (other than by an amendment or supplement relating
solely to the issuance and/or offering of securities other than
the Notes) or (ii) (if required by the Terms Agreement relating
to such Notes) the Company sells Notes to one or more Agents as
principal, the Company shall cause PricewaterhouseCoopers LLP
forthwith to furnish to the Agent(s) a letter, dated the date of
filing with the Commission or the date of effectiveness of such
amendment or supplement, as applicable, or the date of such sale,
as the case may be, in form satisfactory to the Agent(s), of the
same tenor as the letter referred to in Section 7(a) hereof but
modified to relate to the Registration Statement and Prospectus
as amended and supplemented to the date of such letter; provided,
however, that if the Registration Statement or the Prospectus is
amended or supplemented solely to include financial information
as of and for a fiscal quarter, PricewaterhouseCoopers LLP may
limit the scope of such letter to the unaudited financial
statements included in such amendment or supplement unless any
other information included therein of an accounting, financial or
statistical nature is of such a nature that, in the reasonable
judgment of the Agents, such letter should cover such other
information.
(e) The Company shall not sell Notes which are not
substantially in a form previously certified without prior
notification to each Agent or ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ as counsel to
the Agents.
9. Indemnification and Contribution.
--------------------------------
(a) The Company and the Guarantor agree that they will
jointly and severally indemnify and hold harmless each Agent and
each person, if any, who controls any Agent within the meaning of
Section 15 of the 1933 Act, against any and all loss, expense,
claim, damage or liability to which, jointly or severally, such
Agent or such controlling person may become subject, under the
1933 Act or otherwise, insofar as such loss, expense, claim,
damage or liability (or actions in respect thereof) arises out of
or is based upon any untrue statement or alleged untrue statement
of any material fact contained in the Registration Statement, the
Prospectus, or any amendment or supplement to any thereof, or
arises out of or is based upon the omission or alleged omission
to state therein any material fact required to be stated therein
or necessary to make the statements therein not misleading; and,
except as hereinafter in this Section provided, the Company and
the Guarantor agree to reimburse each Agent and each person who
controls any Agent as aforesaid for any reasonable legal or other
expenses as incurred by such Agent or such controlling person in
connection with investigating or defending any such loss,
expense, claim, damage or liability; provided, however, that the
Company and the Guarantor shall not be liable in any such case to
the extent that any such loss, expense, claim, damage or
liability arises out of or is based on an untrue statement or
alleged untrue statement or omission or alleged omission made in
any such document in reliance upon, and in conformity with,
written information furnished to the Guarantor or the Company by
or through any such Agent expressly for use in any such document
or arises out of, or is based on, statements in or omissions from
that part of the Registration Statement which shall constitute
the T-1; and provided further, that with respect to any untrue
statement or alleged untrue statement or omission or alleged
omission made in any prospectus or supplement, the indemnity
agreement contained in this subsection (a) shall not inure to the
benefit of any Agent from whom the person asserting any such
loss, expense, claim, damage or liability purchased the Notes
concerned (or to the benefit of any person controlling such
Agent), if a copy of the Prospectus (not including documents
incorporated by reference therein) or of the Prospectus as then
amended or supplemented (not including documents incorporated by
reference therein) was not sent or given to such person at or
prior to the written confirmation of the sale of such Notes to
such person.
(b) Each Agent severally agrees that it will indemnify
and hold harmless the Company and the Guarantor, their officers
and directors, and each of them, and each person, if any, who
controls the Company and the Guarantor within the meaning of
Section 15 of the 1933 Act, against any loss, expense, claim,
damage or liability to which it or they may become subject, under
the 1933 Act or otherwise, insofar as such loss, expense, claim,
damage or liability (or actions in respect thereof) arises out of
or is based on any untrue statement or alleged untrue statement
of any material fact contained in the Registration Statement, the
Prospectus, or any amendment or supplement to any thereof, or
arises out of or is based upon the omission or alleged omission
to state therein any material fact required to be stated therein
or necessary to make the statements therein not misleading, in
each case to the extent, and only to the extent, that such untrue
statement or alleged untrue statement or omission or alleged
omission was made in any such documents in reliance upon, and in
conformity with, written information furnished to the Guarantor
or the Company by or through any Agent expressly for use in any
such document; and, except as hereinafter in this Section
provided, each Agent agrees to reimburse the Company and the
Guarantor, their officers and directors, and each of them, and
each person, if any, who controls the Company and the Guarantor
within the meaning of Section 15 of the 1933 Act, for any
reasonable legal or other expenses incurred by it or them in
connection with investigating or defending any such loss,
expense, claim, damage or liability.
(c) Upon receipt of notice of the commencement of any
action against an indemnified party, the indemnified party shall,
with reasonable promptness, if a claim in respect thereof is to
be made against an indemnifying party under its agreement
contained in this Section 9, notify such indemnifying party in
writing of the commencement thereof; but the omission so to
notify an indemnifying party shall not relieve it from any
liability which it may have to the indemnified party otherwise
than under its agreement contained in this Section 9. In the
case of any such notice to an indemnifying party, it shall be
entitled to participate at its own expense in the defense, or if
it so elects, to assume the defense, of any such action, but, if
it elects to assume the defense, such defense shall be conducted
by counsel chosen by it and satisfactory to the indemnified party
and to any other indemnifying party, defendant in the suit. In
the event that any indemnifying party elects to assume the
defense of any such action and retain such counsel, the
indemnified party shall bear the fees and expenses of any
additional counsel retained by it. No indemnifying party shall
be liable in the event of any settlement of any such action
effected without its consent except as provided in Section 9(e)
hereof. Each indemnified party agrees promptly to notify each
indemnifying party of the commencement of any litigation or
proceedings against it in connection with the issue and sale of
the Notes.
(d) If any Agent or person entitled to indemnification
by the terms of subsection (a) of this Section 9 shall have given
notice to the Company and the Guarantor of a claim in respect
thereof pursuant to Section 9(c) hereunder, and if such claim for
indemnification is thereafter held by a court to be unavailable
for any reason other than by reason of the terms of this
Section 9 or if such claim is unavailable under controlling
precedent, such Agent or person shall be entitled to contribution
from the Company and the Guarantor to liabilities and expenses,
except to the extent that contribution is not permitted under
Section 11(f) of the 1933 Act. In determining the amount of
contribution to which such Agent or person is entitled, there
shall be considered the relative benefits received by such Agent
or person and the Company and the Guarantor from the offering of
the Notes that were the subject of the claim for indemnification
(taking into account the portion of the proceeds of the offering
realized by each), the Agent or person's relative knowledge and
access to information concerning the matter with respect to which
the claim was asserted, the opportunity to correct and prevent
any statement or omission, and any other equitable considerations
appropriate under the circumstances. The Company and the
Guarantor and the Agents agree that it would not be equitable if
the amount of such contribution were determined by pro rata or
per capita allocation (even if the Agents were treated as one
entity for such purpose).
(e) 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 9 (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 and 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 the failure to act by or on
behalf of any indemnified party.
(f) The indemnity and contribution provided for in
this Section 9 and the representations and warranties of the
Company, the Guarantor and the several Agents set forth in this
Agreement shall remain operative and in full force and effect
regardless of (i) any investigation made by or on behalf of any
Agent or any person controlling any Agent, the Company, its
directors or officers, the Guarantor or any person controlling
the Guarantor, (ii) acceptance of any Notes and payment therefor
under this Agreement, and (iii) any termination of this
Agreement.
10. Default of Agents.
-----------------
If the Company and two or more Agents enter into an
agreement pursuant to which such Agents agree to purchase Notes
from the Company as principal and one or more of such Agents
shall fail at the Settlement Date to purchase the Notes which it
or they are obligated to purchase (the "Defaulted Notes"), then
the non-defaulting Agents may make arrangements satisfactory to
the Company for one of them or one or more other Agents or any
other agents to purchase all, but not less than all, of the
Defaulted Notes in such amounts as may be agreed upon and upon
the terms herein set forth in this Agreement. If, however, no
such arrangements shall have been made within 24 hours
thereafter, then the non-defaulting Agents shall be obligated,
severally and not jointly, to purchase the full amount thereof in
the proportions which their respective initial underwriting
obligations bear to the underwriting obligations of all
non-defaulting Agents. In the event of any such default, either
the non-defaulting Agents or the Company may by prompt written
notice to such other parties postpone the Settlement Date for a
period of not more than seven full business days in order to
effect whatever changes may thereby be made necessary in the
Registration Statement or Prospectus or in any other documents or
arrangements, and the Company will promptly file any amendments
to the Registration Statement or Supplements to the Prospectus
which may thereby be made necessary. As used in this Agreement,
the term "Agent" includes any person substituted for an Agent
under this Section 10.
Nothing in this Section 10 shall relieve an Agent from
liability for its default.
11. Survival of Certain Representations and Obligations.
---------------------------------------------------
The respective indemnities, agreements, representations
and warranties of the Company and the Guarantor and of or on
behalf of the Agents set forth in or made pursuant to this
Agreement will remain in full force and effect, regardless of any
investigation, or statement as to the results thereof, made by or
on behalf of any Agent or the Company and the Guarantor or any of
their respective officers, directors, or any controlling person,
and will survive delivery of and payment for the Notes. If for
any reason the purchase of the Notes by the Agents is not
consummated, the Company shall remain responsible for the
expenses to be paid or reimbursed by it pursuant to Sections 5(c)
and 6, and the respective obligations of the Company, the
Guarantor and the Agents pursuant to Sections 9, 11, 12 and 14
hereof shall remain in effect.
12. Termination.
-----------
(a) This Agreement (excluding any agreement by one or
more Agents to purchase Notes as principal) may be terminated,
for any reason at any time, by either the Company or an Agent, as
to itself, upon the giving of 30 days' prior written notice of
such termination to the other party hereto.
(b) The applicable Agent(s) may terminate any
agreement by such Agent(s) to purchase Notes as principal,
immediately upon notice to the Company and the Guarantor, at any
time prior to the Settlement Date relating thereto, if
(i) there has been, since the date of such Terms Agreement or
since the respective dates as of which information is given in
the Prospectus, as amended or supplemented to such date, any
change or any development involving a prospective change in or
affecting particularly the business or properties of the
Guarantor, which, in the judgment of any such Agent, materially
impairs the investment quality of such Notes; (ii) there has been
any suspension or limitation of trading in securities generally
on the New York Stock Exchange, or any setting of minimum or
maximum prices for trading on such exchange, or any suspension or
limitation of trading of any securities of the Company or the
Guarantor on any exchange or in the over-the-counter market;
(iii) a general banking moratorium has been declared by Federal
or New York authorities; (iv) there shall have occurred any
outbreak or escalation of major hostilities in which the United
States is involved, any declaration of war by Congress or any
other substantial national or international calamity or emergency
if, in the reasonable judgment of such Agent, in each case the
effect of which makes it impractical and inadvisable to proceed
with completion of the sale of and payment for the Notes and such
Agent makes a similar determination with respect to all other
underwritings of medium-term notes of utilities or utility
holding companies in which it is participating and has the
contractual right to make such a determination; or (v) there has
been any decrease in the ratings of the Program or any debt
securities of the Company or the Guarantor (including the Notes)
that existed as of the date of such agreement by any "nationally
recognized statistical rating organization" (as defined for
purposes of Rule 436(g) under the ▇▇▇▇ ▇▇▇) or if such
organization shall have publicly announced that it has under
surveillance or review, with possible negative implications, its
rating of the Program or any such debt securities.
(c) In the event of any such termination, no party
will have any liability to the other parties hereto, except that
(i) the Agents shall be entitled to any commissions earned in
accordance with the third paragraph of Section 3(b) hereof,
(ii) if at the time of termination (a) any Agent shall own any
Notes purchased by it as principal pursuant to a Terms Agreement
or (b) an offer to purchase any of the Notes has been accepted by
the Company but the time of delivery to the purchaser or his
agent of such Notes relating thereto has not occurred, the
covenants set forth in Sections 5 and 8 hereof shall remain in
effect until such Notes are so resold or delivered, as the case
may be, and (iii) the covenant set forth in Section 5(h) hereof,
the provisions of Section 6 hereof, the indemnity and
contribution agreements set forth in Section 9 hereof, and the
provisions of Sections 11, 14 and 15 hereof shall remain in
effect.
13. Notices.
-------
The Company and the Guarantor shall be entitled to act
and rely upon any statement, request, notice or agreement on
behalf of each of the Agents if the same shall have been made or
given by the Agents. All statements, requests, notices, consents
and agreements hereunder shall be in writing, or by telegraph
subsequently confirmed in writing, to the following addresses:
If to the Company or the Guarantor:
PP&L Resources, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Treasurer
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
[Agent Name]
[Agent Address]
[Agent Name]
[Agent Address]
[Agent Name]
[Agent Address]
14. Parties in Interest.
-------------------
This Agreement shall each inure solely to the benefit
of the Company, the Guarantor and the Agents and, to the extent
provided in Section 9 hereof, to any person who controls any
Agent, to the officers and directors of the Company and the
Guarantor, and to any person who controls the Company or the
Guarantor, and their respective successors. No other person,
partnership, association or corporation shall acquire or have any
right under or by virtue of this Agreement. The term "successor"
shall not include any assignee of an Agent (other than a person
substituted for an Agent under Section 10 hereof or one who shall
acquire all or substantially all of an Agent's business and
properties), nor shall it include any purchaser of Notes from any
Agent merely because of such purchase.
15. Applicable Law.
--------------
THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
16. Counterparts.
------------
This Agreement may be executed by any one or more of
the parties hereto in any number of counterparts, each of which
shall be deemed to be an original, but all such respective
counterparts shall together constitute one and the same
instrument.
Please confirm that the foregoing correctly sets forth
the agreement between us by signing in the space provided below
for that purpose, whereupon this Distribution Agreement shall
constitute a binding agreement between the Company and the
Guarantor and the several Agents in accordance with its terms.
Yours very truly,
PP&L RESOURCES, INC.
By:
-------------------------------------
Name:
Title:
PP&L CAPITAL FUNDING, INC.
By:
-------------------------------------
Name:
Title:
The foregoing Distribution Agreement is hereby confirmed and
accepted as of the date first above written.
[Agent Name]
By:
------------------------
[Agent Name]
By:
------------------------
[Agent Name]
By:
------------------------
SCHEDULE A
PRICING TERMS
Principal Amount: $
--------------
Interest Rate or Formula:
If Fixed Rate Note,
Interest Rate:
Interest Payment Dates:
If Floating Rate Note,
Interest Rate Basis(es):
If LIBOR,
LIBOR Reuters Page:
--
LIBOR Telerate Page:
--
Designated LIBOR Currency:
If CMT Rate,
Designated CMT Telerate Page:
If Telerate Page 7052:
Weekly Average
--
Monthly Average
--
Designated CMT Maturity Index:
Index Maturity:
Spread and/or Spread Multiplier, if any:
Initial Interest Rate, if any:
Initial Interest Reset Date:
Interest Reset Dates:
Interest Payment Dates:
Maximum Interest Rate, if any:
Minimum Interest Rate, if any:
Fixed Rate Commencement Date, if any:
Fixed Interest Rate, if any:
Day Count Convention:
Calculation Agent:
Redemption Provisions:
Initial Redemption Date:
Initial Redemption Percentage:
Annual Redemption Percentage Reduction, if any:
Repayment Provisions:
Optional Repayment Date(s)
Original Issue Date:
Stated Maturity Date
Exchange Rate Agent:
Authorized Denomination:
Purchase Price: %, plus accrued interest, if any, from
---
---------
Price to Public: %, plus accrued interest, if any, from
---
---------
Issue Price:
Settlement Date and Time:
Additional/Other Terms:
Also, in connection with the purchase of Notes from the Company
by one or more Agents as principal, agreement as to whether the
following will be required:
Officers' Certificate pursuant to Section 7(f) of the
Distribution Agreement
Legal Opinions pursuant to Section 7(c)and(d) of the
Distribution Agreement
Comfort Letter pursuant to Section 7(a) of the Distribution
Agreement
SCHEDULE B
As compensation for the services of the Agents hereunder,
the Company shall pay the applicable Agent, on a discount basis,
a commission for the sale of each Note equal to the principal
amount of such Notes multiplied by the appropriate percentage set
forth below:
PERCENT OF
MATURITY RANGES PRINCIPAL AMOUNT
--------------- ----------------
From 9 months to less than 1 year
From 1 year to less than 18 months
From 18 months to less than 2 years
From 2 years to less than 3 years
From 3 years to less than 4 years
From 4 years to less than 5 years
From 5 years to less than 6 years
From 6 years to less than 7 years
From 7 years to less than 10 years
From 10 years to less than 15 years
From 15 years to less than 20 years
From 20 years to 30 years
From 30 years to 40 Years
---------------------
* As agreed to by the Company and the applicable Agent at the
time of sale.
SCHEDULE C
----------
PP&L CAPITAL FUNDING, INC.
ADMINISTRATIVE PROCEDURES
FOR FIXED RATE AND FLOATING RATE MEDIUM-TERM NOTES, SERIES B
(Dated as of , 1999)
-----------
Medium-Term Notes, Series A (the "Notes") in an
aggregate principal amount of up to $[400,000,000] are to be
offered on a continuous basis by PP&L Capital Funding, Inc., a
Delaware corporation (the "Company"), to or through
-----------------------------------------------------------------
-----------------------------------------------------------------
(each, an "Agent" and,
---------------------------------
collectively, the "Agents") pursuant to a Distribution Agreement,
dated , 1999 (the "Distribution Agreement"), by and
-----------
among the Company, PP&L Resources, Inc. (the "Guarantor") and the
Agents. Each of the Notes is to be unconditionally guaranteed as
to payment of principal, premium, if any, and interest by the
Guarantor pursuant to guarantees of the Guarantor (the
"Guarantees"). The Distribution Agreement provides both for the
sale of Notes by the Company to one or more of the Agents as
principal for resale to investors and other purchasers and for
the sale of Notes by the Company directly to investors through
one or more Agents (as may from time to time be agreed to by the
Company and the related Agent or Agents), in which case each such
Agent will act as an agent of the Company in soliciting purchases
of Notes.
Unless otherwise agreed by the related Agent or Agents
and the Company, Notes will be purchased by the related Agent or
Agents as principal. Such purchases will be made in accordance
with the applicable Terms Agreement as provided in the
Distribution Agreement. If agreed upon by any Agent or Agents
and the Company, the Agent or Agents, acting solely as agent or
agents for the Company and not as principal, will use reasonable
efforts to solicit offers to purchase the Notes. Only those
provisions in these Administrative Procedures that are applicable
to the particular role to be performed by the related Agent or
Agents shall apply to the offer and sale of the relevant Notes.
The Notes will be issued under an Indenture, dated as
of November 1, 1997, as amended, supplemented or modified from
time to time (the "Indenture"), between the Company, the
Guarantor and The Chase Manhattan Bank ("Chase"), as trustee
(together with any successor in such capacity, the "Trustee").
The Company and the Guarantor have filed a joint Registration
Statement with the Securities and Exchange Commission (the
"Commission") registering debt securities, including the Notes
and the Guarantees (the "Registration Statement", which term
shall include any additional registration statements filed in
connection with the Notes and the Guarantees). The most recent
base prospectus deemed part of the Registration Statement, as
supplemented by a Prospectus supplement relating to the Notes, is
herein referred to as "Prospectus". The most recent supplement
to the Prospectus setting forth the purchase price, interest rate
or formula, maturity date and other terms of the Notes (as
applicable) is herein referred to as the "Pricing Supplement".
The Notes will either be issued (a) in book-entry form
and represented by one or more fully registered Notes without
coupons (each, a "Global Note") delivered to Chase, as agent for
The Depository Company ("DTC"), and recorded in the book-entry
system maintained by DTC, or (b) in certificated form (each, a
"Certificated Note") delivered to the investor or other purchaser
thereof or a person designated by such investor or other
purchaser.
General procedures relating to the issuance of all
Notes are set forth in Part I hereof. Additionally, Notes issued
in book-entry form will be issued in accordance with the
procedures set forth in Part II hereof, as adjusted from time to
time in accordance with changes in DTC's operating requirements,
and Certificated Notes will be issued in accordance with the
procedures set forth in Part III hereof. To the extent any
procedure set forth below conflicts with the provisions of the
Notes, the Indenture or the Distribution Agreement, the relevant
provisions of the Notes, the Indenture and the Distribution
Agreement, respectively, shall control. Capitalized terms used
but not otherwise defined herein shall have the meanings ascribed
thereto in the Notes, the Indenture or the Distribution Agreement
as the case may be.
PART I: PROCEDURES OF GENERAL
APPLICABILITY
Date of Issuance/
Authentication: Each Note will be dated as of the date
of its authentication by the Trustee.
Each Note shall also bear an original
issue date (each, an "Original Issue
Date"). The Original Issue Date shall
remain the same for all Notes
subsequently issued upon transfer,
exchange or substitution of an original
Note regardless of their dates of
authentication.
Price to Public: Unless otherwise agreed to by the
Company and the Agents and specified in
a Pricing Supplement, each Note will be
issued at 100% of the principal amount
thereof.
Maturities: Each Note will mature on a date from
nine months to 40 years from its
Original Issue Date (the "Stated
Maturity Date") selected by the investor
or other purchaser and agreed to by the
Company.
Guarantees: Each of the Notes is to be
unconditionally guaranteed as to payment
of principal, premium, if any, and
interest pursuant to the Guarantees of
the Guarantor as set forth in the
Indenture.
Registration: Unless otherwise provided in the
applicable Pricing Supplement, Notes
will be issued only in fully registered
form.
Denominations: Unless otherwise provided in the
applicable Pricing Supplement, the Notes
will be issued in denominations of
$1,000 and integral multiples thereof.
Interest Rate Bases
applicable to
Floating Rate
Notes: Unless otherwise provided in the
applicable Pricing Supplement, Floating
Rate Notes will bear interest at a rate
or rates determined by reference to the
CMT Rate, the Commercial Paper Rate, the
Federal Funds Rate, LIBOR, the Prime
Rate, the Treasury Rate, or such other
interest rate basis or formula as may be
set forth in applicable Pricing
Supplement, or by reference to two or
more such rates, as adjusted by the
Spread and/or Spread Multiplier, if any,
applicable to such Floating Rate Notes.
Redemption/
Repayment: The Notes will be subject to redemption
by the Company in accordance with the
terms of the Notes, which will be fixed
at the time of sale and set forth in the
applicable Pricing Supplement. If no
Initial Redemption Date is indicated
with respect to a Note, such Note will
not be redeemable prior to its Stated
Maturity Date.
The Notes will be subject to repayment
at the option of the Holders thereof in
accordance with the terms of the Notes,
which will be fixed at the time of sale
and set forth in the applicable Pricing
Supplement. If no Optional Repayment
Date is indicated with respect to a
Note, such Note will not be repayable at
the option of the Holder prior to its
Stated Maturity Date.
Calculation of
Interest: In case of Fixed Rate Notes, interest
(including payments for partial periods)
will be calculated and paid on the basis
of a 360-day year of twelve 30-day
months.
The interest rate on each Floating Rate
Note will be calculated by reference to
the specified Interest Rate Basis or
Bases plus or minus the applicable
Spread, if any, and/or multiplied by the
applicable Spread Multiplier, if any.
Unless and until otherwise authorized by
the Guarantor and the Company and
provided in the applicable Pricing
Supplement, the interest rate on any
Fixed Rate Note will not exceed 9 1/2%
per annum.
Unless otherwise provided in the
applicable Pricing Supplement, interest
on each Floating Rate Note will be
calculated by multiplying its principal
amount by an accrued interest factor.
Such accrued interest factor is computed
by adding the interest factor calculated
for each day in the period for which
accrued interest is being calculated.
Unless otherwise provided in the
applicable Pricing Supplement, the
interest factor for each such day is
computed by dividing the interest rate
applicable to such day by 360 if the
Commercial Paper Rate, Federal Funds
Rate, LIBOR or Prime Rate is an
applicable Interest Rate Basis, or by
the actual number of days in the year if
the CMT Rate or Treasury Rate is an
applicable Interest Rate Basis. The
interest factor for Notes for which the
interest rate is calculated with
reference to two or more Interest Rate
Bases will be calculated as provided in
the applicable Pricing Supplement.
Interest: General. Each Note will bear interest
-------
in accordance with its terms. Unless
otherwise provided in the applicable
Pricing Supplement, interest on each
Note will accrue from and including the
Original Issue Date of such Note for the
first interest period or from the most
recent Interest Payment Date (as defined
below) to which interest has been paid
or duly provided for all subsequent
interest periods to but excluding the
next applicable Interest Payment Date or
the Stated Maturity Date or date of
earlier redemption or repayment, as the
case may be (the Stated Maturity Date or
date of earlier redemption or repayment
is referred to herein as the "Maturity
Date" with respect to the principal
repayable on such date).
If an Interest Payment Date or the
Maturity Date with respect to any Fixed
Rate Note falls on a day that is not a
Business Day (as defined below), the
required payment to be made on such day
need not be made on such day, but may be
made on the next succeeding Business Day
with the same force and effect as if
made on such day, and no interest shall
accrue on such payment for the period
from and after such day to the next
succeeding Business Day. If an Interest
Payment Date other than the Maturity
Date with respect to any Floating Rate
Note would otherwise fall on a day that
is not a Business Day, such Interest
Payment Date will be postponed to the
next succeeding Business Day, except
that in the case of a Note for which
LIBOR is an applicable Interest Rate
Basis, if such Business Day falls in the
next succeeding calendar month, such
Interest Payment Date will be the
immediately preceding Business Day. If
the Maturity Date with respect to any
Floating Rate Note falls on a day that
is not a Business Day, the required
payment to be made on such day need not
be made on such day, but may be made on
the next succeeding Business Day with
the same force and effect as if made on
such day, and no interest shall accrue
on such payment for the period from and
after the Maturity Date to the next
succeeding Business Day. Unless
otherwise provided in the applicable
Pricing Supplement, "Business Day" means
any day, other than a Saturday or
Sunday, that is not a day on which
banking institutions or trust companies
are generally authorized or required by
law, regulation or executive order to
close in The City of New York; provided
that, with respect to Notes for which
LIBOR is an applicable Interest Rate
Basis, such day is also a London
Business Day (as defined below).
"London Business Day" means any day on
which dealings in deposits in United
States Dollars are transacted in the
London interbank market.
Regular Record Dates. Unless otherwise
--------------------
provided in the applicable Pricing
Supplement, the "Regular Record Date"
for a Fixed Rate Note shall be the
January 31 or July 31 immediately
preceding the applicable Interest
Payment Date and the "Regular Record
Date" for a Floating Rate Note shall be
the date 15 calendar days (whether or
not a Business Day) preceding the
applicable Interest Payment Date.
Interest Payment Dates. Interest
----------------------
payments will be made on each Interest
Payment Date commencing with the first
Interest Payment Date following the
Original Issue Date; provided, however,
the first payment of interest on any
Note originally issued between a Regular
Record Date and an Interest Payment Date
will occur on the Interest Payment Date
following the next succeeding Regular
Record Date.
Unless otherwise provided in the
applicable Pricing Supplement, interest
payments on Fixed Rate Notes will be
made semiannually in arrears on February
15 and August 15 of each year and on the
Maturity Date, while interest payments
on Floating Rate Notes will be made as
specified in the Prospectus and the
applicable Pricing Supplement.
Acceptance and
Rejection of
Offers from
Solicitation
as Agents: If agreed upon by any Agent and the
Company, then such Agent acting solely
as agent for the Company and not as
principal will solicit purchases of the
Notes. Each Agent will communicate to
the Company, orally or in writing, each
reasonable offer to purchase Notes
solicited by such Agent on an agency
basis, other than those offers rejected
by such Agent. Each Agent has the
right, in its discretion reasonably
exercised, to reject any proposed
purchase of Notes, as a whole or in
part, and any such rejection shall not
be a breach of such Agent's agreement
contained in the Distribution Agreement.
The Company has the sole right to accept
or reject any proposed purchase of
Notes, in whole or in part, and any such
rejection shall not be a breach of the
Company's agreement contained in the
Distribution Agreement. Each Agent has
agreed to make reasonable efforts to
assist the Company in obtaining
performance by each purchaser whose
offer to purchase Notes has been
solicited by such Agent and accepted by
the Company.
Preparation of
Pricing
Supplement: If any offer to purchase a Note is
accepted by the Company, the Company and
the Guarantor will promptly prepare a
Pricing Supplement reflecting the terms
of such Note. Information to be
included in the Pricing Supplement shall
include:
1. the name of the Company and the
name of the Guarantor;
2. the title of the Notes;
3. the date of the Pricing Supplement
and the date of the Prospectus to
which the Pricing Supplement
relates;
4. the name of the Offering Agent (as
defined below);
5. whether such Notes are being sold
to the Offering Agent as principal
or to an investor or other
purchaser through the Offering
Agent acting as agent for the
Company;
6. with respect to Notes sold to the
Offering Agent as principal,
whether such Notes will be resold
by the Offering Agent to investors
and other purchasers at (i) a fixed
public offering price of 100% of
their principal amount or at (ii)
varying prices related to
prevailing market prices at the
time of resale to be determined by
the Offering Agent;
7. the Offering Agent's discount or
commission;
8. Net proceeds to the Company;
9. the Principal Amount, Original
Issue Date, Stated Maturity Date,
Interest Payment Date(s), Initial
Redemption Date, if any, Initial
Redemption Percentage, if any,
Annual Redemption Percentage
Reduction, if any, Optional
Repayment Date(s), if any, and, in
the case of Fixed Rate Notes, the
Interest Rate, and, in the case of
Floating Rate Notes, the Interest
Rate Basis or Bases, the Day Count
Convention, Index Maturity (if
applicable), Initial Interest Rate,
if any, Maximum Interest Rate, if
any, Minimum Interest Rate, if any,
Initial Interest Reset Date,
Interest Reset Dates, Spread and/or
Spread Multiplier, if any, and
Calculation Agent; and
10. any other additional provisions of
the Notes material to investors or
other purchasers of the Notes not
otherwise specified in the
Prospectus.
The Company shall endeavor to send such
Pricing Supplement by telecopy or
overnight express (for delivery by the
close of business on the applicable
trade date, but in no event later than
11:00 A.M. New York City time, on the
Business Day following the applicable
trade date) to the Agent which made or
presented the offer to purchase the
applicable Note (in such capacity, the
"Offering Agent") and the Trustee at the
following applicable address: if to
---------------------------------------
---------------------------------------
---------------------------------------
---------------------------------------
---------------------------------------
---------------------------------------
---------------------------------------
---------------------------------------
---------------------------------------
---------------------------------------
---------------------------------------
---------------------------------------
---------------------------------------
---------------------------------------
; and if to the Trustee
----------------
(or Chase), to: ▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention:
Corporate Trustee Administration, (212)
946-3487, telecopier: (▇▇▇) ▇▇▇-▇▇▇▇.
For record keeping purposes, one copy of
such Pricing Supplement shall also be
mailed or telecopied to
---------------------------------------
---------------------------------------
---------------------------------------
---------------------------------------
,
--------------------------------------
with a copy, to each of ▇▇▇▇▇▇ ▇▇▇▇ &
Priest, LLP, ▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention:
▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇, and ▇▇▇▇▇▇▇▇ &
▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇.
▇▇▇▇▇, ▇▇., Esq.
In each instance that a Pricing
Supplement is prepared, the Offering
Agent will provide a copy of such
Pricing Supplement to each investor or
purchaser of the relevant Notes or its
agent. Pursuant to Rule 434 of the
Securities Act of 1933, as amended
("Rule 434"), the Pricing Supplement may
be delivered separately from the
Prospectus. Outdated Pricing
Supplements (other than those retained
for files) will be destroyed.
Settlement: The receipt of immediately available
funds by the Company in payment for a
Note and the authentication and delivery
of such Note shall, with respect to such
Note, constitute "settlement". Offers
accepted by the Company will be settled
in three Business Days, or at such time
as the purchaser, the applicable Agent
and the Company shall agree, pursuant to
the timetable for settlement set forth
in Parts II and III hereof under
"Settlement Procedure Timetable" with
respect to Global Notes and Certificated
Notes, respectively (each such date
fixed for settlement is hereinafter
referred to as a "Settlement Date"). If
procedures A and B of the applicable
Settlement Procedures with respect to a
particular offer are not completed on or
before the time set forth under the
applicable "Settlement Procedures
Timetable", such offer shall not be
settled until the Business Day following
the completion of settlement procedures
A and B or such later date as the
purchaser and the Company shall agree.
The foregoing settlement procedures may
be modified with respect to any purchase
of Notes by an Agent as principal if so
agreed by the Company and such Agent.
Procedure for
Changing Rates
or Other
Variable Terms: When a decision has been reached to
change the interest rate or any other
variable term on any Notes being sold by
the Company, the Company will promptly
advise the Agents and the Trustee by
facsimile transmission and the Agents
will forthwith suspend solicitation of
offers to purchase such Notes. The
Agents will telephone the Company with
recommendations as to the changed
interest rates or other variable terms.
At such time as the Company notifies the
Agents and the Trustee of the new
interest rates or other variable terms,
the Agents may resume solicitation of
offers to purchase such Notes. Until
such time, only "indications of
interest" may be recorded. Immediately
after acceptance by the Company of an
offer to purchase Notes at a new
interest rate or new variable term, the
Company, the Offering Agent and the
Trustee shall follow the procedures set
forth under the applicable "Settlement
Procedures".
Suspension of
Solicitation;
Amendment or
Supplement: The Company may instruct the Agents to
suspend solicitation of offers to
purchase Notes at any time. Upon
receipt of such instructions, the Agents
will forthwith suspend solicitation of
offers to purchase from the Company
until such time as the Company has
advised the Agents that solicitation of
offers to purchase may be resumed. If
the Company or the Guarantor decides to
amend or supplement the Registration
Statement or the Prospectus (other than
to establish or change interest rates or
formulas, maturities, prices or other
similar variable terms with respect to
the Notes), it will promptly advise the
Agents and will furnish the Agents and
their counsel with copies of the
proposed amendment or supplement.
Copies of such amendment or supplement
will be delivered or mailed to the
Agents, their counsel and the Trustee in
quantities which such parties may
reasonably request at the following
respective addresses:
----------------
---------------------------------------
---------------------------------------
---------------------------------------
---------------------------------------
---------------------------------------
---------------------------------------
---------------------------------------
---------------------------------------
---------------------------------------
---------------------------------------
--------------------------------------;
and if to the Trustee (or Chase), to:
▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇, Attention: Corporate Trustee
Administration, (▇▇▇) ▇▇▇-▇▇▇▇,
telecopier: (▇▇▇) ▇▇▇-▇▇▇▇. For record
keeping purposes, one copy of each such
amendment or supplement shall also be
mailed or telecopied to each of ▇▇▇▇▇▇
▇▇▇▇ & Priest LLP, ▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇,
Attention: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇, and
▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇., Esq., (212)
558-3812, telecopier: (▇▇▇) ▇▇▇-▇▇▇▇.
In the event that at the time the
solicitation of offers to purchase from
the Company is suspended (other than to
establish or change interest rates or
formulas, maturities, prices or other
similar variable terms with respect to
the Notes) there shall be any offers to
purchase Notes that have been accepted
by the Company which have not been
settled, the Company will promptly
advise the Offering Agent and the
Trustee whether such offers may be
settled and whether copies of the
Prospectus as theretofore amended and/or
supplemented as in effect at the time of
the suspension may be delivered in
connection with the settlement of such
offers. The Company will have the sole
responsibility for such decision and for
any arrangements which may be made in
the event that the Company determines
that such offers may not be settled or
that copies of such Prospectus may not
be so delivered.
Delivery of
Prospectus and
applicable
Pricing
Supplement: A copy of the most recent Prospectus and
the applicable Pricing Supplement, which
pursuant to Rule 434 may be delivered
separately from the Prospectus, must
accompany or precede the earlier of
(a) the written confirmation of a sale
sent to an investor or other purchaser
or its agent and (b) the delivery of
Notes to an investor or other purchaser
or its agent.
Authenticity of
Signatures: The Agents will have no obligation or
liability to the Company, the Guarantor
or the Trustee in respect of the
authenticity of the signature of any
officer, employee or agent of the
Company, the Guarantor or the Trustee on
any Note or Guarantee.
Documents
Incorporated by
Reference: The Company shall supply the Agents with
an adequate supply of all documents
incorporated by reference in the
Registration Statement and the
Prospectus.
PART II: PROCEDURES FOR NOTES ISSUED
IN BOOK-ENTRY FORM
In connection with the qualification of Notes issued in
book-entry form for eligibility in the book-entry system
maintained by DTC, Chase will perform the custodial, document
control and administrative functions described below, in
accordance with its respective obligations under a Letter of
Representations from the Company, the Guarantor and the Trustee
to DTC, dated , 1998, and a Certificate Agreement,
-------------
dated December 2, 1988, between Chase and DTC, as amended (the
"Certificate Agreement"), and its obligations as a participant in
DTC, including DTC's Same-Day Funds Settlement System ("SDFS").
Issuance: All Fixed Rate Notes issued in book-
entry form having the same Original
Issue Date, Interest Rate, Interest
Payment Dates, redemption and/or
repayment terms, if any, and Stated
Maturity Date (collectively, the "Fixed
Rate Terms") will be represented
initially by a single Global Note; and
all Floating Rate Notes issued in
book-entry form having the same Original
Issue Date, formula for the calculation
of interest (including the Interest Rate
Basis or Bases, which may be the CMT
Rate, the Commercial Paper Rate, the
Federal Funds Rate, LIBOR, the Prime
Rate or the Treasury Rate or any other
interest rate basis or formula, and
Spread and/or Spread Multiplier, if
any), Day Count Convention, Initial
Interest Rate, Index Maturity (if
applicable), Minimum Interest Rate, if
any, Maximum Interest Rate, if any,
redemption and/or repayment terms, if
any, Interest Payment Dates, Initial
Interest Reset Date, Interest Reset
Dates and Stated Maturity
Date(collectively, the "Floating Rate
Terms") will be represented initially by
a single Global Note.
For other variable terms with respect to
the Fixed Rate Notes and Floating Rate
Notes, see the Prospectus and the
applicable Pricing Supplement.
Owners of beneficial interests in Global
Notes will be entitled to physical
delivery of Certificated Notes equal in
principal amount to their respective
beneficial interests only upon certain
limited circumstances described in the
Prospectus.
Identification: The Company has arranged with the CUSIP
Service Bureau of Standard & Poor's
Corporation (the "CUSIP Service Bureau")
for the reservation of one series of
CUSIP numbers, which series consists of
approximately 900 CUSIP numbers which
have been reserved for and relating to
Global Notes, and the Company has
delivered to each of Chase and DTC such
list of such CUSIP numbers. Chase will
assign CUSIP numbers to Global Notes as
described below under Settlement
Procedures B. DTC will notify the CUSIP
Service Bureau periodically of the CUSIP
numbers that Chase has assigned to
Global Notes. Chase will notify the
Company at any time when fewer than 100
of the reserved CUSIP numbers remain
unassigned to Global Notes, and, if it
deems necessary, the Company will
reserve and obtain additional CUSIP
numbers for assignment to Global Notes.
Upon obtaining such additional CUSIP
numbers, the Company will deliver a list
of such additional numbers to Chase and
DTC. Notes issued in book-entry form in
excess of $200,000,000 aggregate
principal amount and otherwise required
to be represented by the same Global
Note will instead be represented by two
or more Global Notes which shall all be
assigned the same CUSIP number.
Registration: Unless otherwise specified by DTC, each
Global Note will be registered in the
name of Cede & Co., as nominee for DTC,
on the register maintained by Chase
under the Indenture. The beneficial
owner of a Note issued in book-entry
form (i.e., an owner of a beneficial
- -
interest in a Global Note) (or one or
more indirect participants in DTC
designated by such owner) will designate
one or more participants in DTC (with
respect to such Note issued in
book-entry form, the "Participants") to
act as agent for such beneficial owner
in connection with the book-entry system
maintained by DTC, and DTC will record
in book-entry form, in accordance with
instructions provided by such
Participants, a credit balance with
respect to such Note issued in
book-entry form in the account of such
Participants. The ownership interest of
such beneficial owner in such Note
issued in book-entry form will be
recorded through the records of such
Participants or through the separate
records of such Participants and one or
more indirect participants in DTC.
Transfers: Transfers of beneficial ownership
interests in a Global Note will be
accomplished by book entries made by DTC
and, in turn, by Participants (and in
certain cases, one or more indirect
participants in DTC) acting on behalf of
beneficial transferors and transferees
of such Global Note.
Exchanges: Chase may deliver to DTC and the CUSIP
Service Bureau at any time a written
notice specifying (a) the CUSIP numbers
of two or more Global Notes outstanding
on such date that represent Global Notes
having the same Fixed Rate Terms or
Floating Rate Terms, as the case may be
(other than Original Issue Dates), and
for which interest has been paid to the
same date; (b) a date, occurring at
least 30 days after such written notice
is delivered and at least 30 days before
the next Interest Payment Date for the
related Notes issued in book-entry form,
on which such Global Notes shall be
exchanged for a single replacement
Global Note; and (c) a new CUSIP number,
obtained from the Company, to be
assigned to such replacement Global
Note. Upon receipt of such a notice,
DTC will send to its Participants
(including Chase) a written
reorganization notice to the effect that
such exchange will occur on such date.
Prior to the specified exchange date,
Chase will deliver to the CUSIP Service
Bureau written notice setting forth such
exchange date and the new CUSIP number
and stating that, as of such exchange
date, the CUSIP numbers of the Global
Notes to be exchanged will no longer be
valid. On the specified exchange date,
Chase will exchange such Global Notes
for a single Global Note bearing the new
CUSIP number and the CUSIP numbers of
the exchanged Notes will, in accordance
with CUSIP Service Bureau procedures, be
canceled and not immediately reassigned.
Notwithstanding the foregoing, if the
Global Notes to be exchanged exceed
$200,000,000 in aggregate principal
amount, one replacement Note will be
authenticated and issued to represent
each $200,000,000 in aggregate principal
amount of the exchanged Global Notes and
an additional Global Note or Notes will
be authenticated and issued to represent
any remaining principal amount of such
Global Notes (See "Denominations"
below).
Denominations: Unless otherwise provided in the
applicable Pricing Supplement, Notes
issued in book-entry form will be issued
in denominations of $1,000 and integral
multiples thereof. Global Notes will
not be denominated in excess of
$200,000,000 aggregate principal amount.
If one or more Notes are issued in
book-entry form in excess of
$200,000,000 aggregate principal amount
and would, but for the preceding
sentence, be represented by a single
Global Note, then one Global Note will
be issued to represent each $200,000,000
in aggregate principal amount of such
Notes issued in book-entry form and an
additional Global Note or Notes will be
issued to represent any remaining
aggregate principal amount of such Note
or Notes issued in book-entry form. In
such a case, each of the Global Notes
representing Notes issued in book-entry
form shall be assigned the same CUSIP
number.
Payments of
Principal
and Interest: Payments of Interest Only. Promptly
-------------------------
after each Regular Record Date, Chase
will deliver to the Company and DTC a
written notice specifying by CUSIP
number the amount of interest to be paid
(to the extent known) on each Global
Note on the following Interest Payment
Date (other than an Interest Payment
Date coinciding with the Maturity Date)
and the total of such amounts. DTC will
confirm the amount payable on each
Global Note on such Interest Payment
Date by reference to the appropriate
(daily or weekly) bond reports published
by Standard & Poor's Corporation. On
such Interest Payment Date, the Company
will pay to Chase in immediately
available funds an amount sufficient to
pay the interest then due and owing on
the Global Notes, and upon receipt of
such funds from the Company, Chase in
turn will pay to DTC such total amount
of interest due on such Global Notes
(other than on the Maturity Date) at the
times and in the manner set forth below
under "Manner of Payment".
Notice of Interest Rates. Promptly
------------------------
after each Interest Determination Date
or Calculation Date, as the case may be,
for Floating Rate Notes issued in
book-entry form, Chase will notify each
of ▇▇▇▇▇'▇ Investors Service, Inc. and
Standard & Poor's Corporation of the
interest rates determined as of such
Interest Determination Date.
Payments at Maturity. On or about the
--------------------
first Business Day of each month, Chase
will deliver to the Company and DTC a
written list of principal, premium, if
any, and interest (to the extent known)
to be paid on each Global Note maturing
or otherwise becoming due in the
following month. Chase, the Company and
DTC will confirm the amounts of such
principal, premium, if any, and interest
payments with respect to each such
Global Note on or about the fifth
Business Day preceding the Maturity Date
of such Global Note. On the Maturity
Date, the Company will pay to Chase in
immediately available funds an amount
sufficient to make the required
payments, and upon receipt of such funds
Chase in turn will pay to DTC the
principal amount of Global Notes,
together with premium, if any, and
interest due on the Maturity Date, at
the times and in the manner set forth
below under "Manner of Payment".
Promptly after payment to DTC of the
principal, premium, if any, and interest
due on the Maturity Date of such Global
Note, the Trustee will cancel such
Global Note and deliver it to the
Company with an appropriate debit
advice. On the first Business Day of
each month, the Trustee will deliver to
the Company a written statement
indicating the total principal amount of
outstanding Global Notes as of the close
of business on the immediately preceding
Business Day.
Manner of Payment. The total amount of
-----------------
any principal, premium, if any, and
interest due on Global Notes on any
Interest Payment Date or the Maturity
Date, as the case may be, shall be paid
by the Company to Chase in funds
available for use by the Trustee no
later than 10:00 A.M., New York City
time, on such date. The Company will
make such payment on such Global Notes
to an account specified by Chase. Upon
receipt of such funds, Chase will pay by
separate wire transfer (using Fedwire
message entry instructions in a form
previously specified by DTC) to an
account at the Federal Reserve Bank of
New York previously specified by DTC, in
funds available for immediate use by
DTC, each payment of principal, premium,
if any, and interest due on Global Notes
on such date. Thereafter on such date,
DTC will pay, in accordance with its
SDFS operating procedures then in
effect, such amounts in funds available
for immediate use to the respective
Participants in whose names the
beneficial interests in such Global
Notes are recorded in the book-entry
system maintained by DTC. Neither the
Company, the Guarantor nor Chase shall
have any responsibility or liability for
the payment by DTC of the principal of,
or premium, if any, or interest on, the
Global Notes.
Withholding Taxes. The amount of any
-----------------
taxes required under applicable law to
be withheld from any interest payment on
a Global Note will be determined and
withheld by the Participant, indirect
participant in DTC or other Person
responsible for forwarding payments and
materials directly to the beneficial
owner of such Global Note.
Settlement
Procedures: Settlement Procedures with regard to
each Note in book-entry form sold by an
Agent, as agent of the Company, or
purchased by an Agent, as principal,
will be as follows:
A. The Offering Agent will advise the
Company by telephone, confirmed by
facsimile, of the following
settlement information:
1. Principal amount and
Authorized Denomination.
2. (a) Fixed Interest Notes:
(i) Interest Rate.
(ii) Interest Payment
Dates.
(b) Floating Rate Notes:
(i) Whether such Note is
a Regular Floating Rate
Note, Inverse Floating
Rate Note or Floating
Rate/Fixed Rate Note.
(ii) Interest Rate Basis
or Bases.
(iii) Initial Interest
Rate.
(iv) Spread and/or Spread
Multiplier, if any.
(v) Initial Interest
Reset Date and Interest
Reset Dates.
(vi) Interest Payment
Dates.
(vii) Index Maturity, if
any.
(viii) Maximum and/or
Minimum Interest Rates,
if any.
(ix) Day Count Con-
vention.
(x) Calculation Agent.
(xi) Fixed Rate
Commencement Date, if
any, and Fixed Interest
Rate, if any.
(xii) Other terms, if
any.
4. Price to public, if any, of
such Note (or whether such
Note is being offered at
varying prices relating to
prevailing market prices at
time of resale as determined
by the Offering Agent).
5. Trade Date.
6. Settlement Date (Original
Issue Date).
7. Stated Maturity Date.
8. Redemption provisions, if any.
9. Repayment provisions, if any.
10. Net proceeds to the Company.
11. The Offering Agent's discount
or commission.
12. Whether such Note is being
sold to the Offering Agent as
principal or to an investor or
other purchaser through the
Offering Agent acting as agent
for the Company.
13. Such other information
specified with respect to such
Note (whether by Addendum or
otherwise).
B. The Company will advise Chase by
facsimile transmission or other
electronic transmission of the
above settlement information
received from the Offering Agent,
and the name of the Offering Agent.
Chase will assign a CUSIP number to
the Global Note representing such
Note. Chase will also advise the
Offering Agent of the CUSIP number
assigned to the Global Note.
C. The Company will transmit to the
Trustee by telex or facsimile its
written request for the
authentication and delivery of such
Global Note and the name of such
Agent. Each such request by the
Company shall constitute a
representation and warranty by the
Company to the Trustee that (i) the
Global Note representing such
Book-Entry Note is then, and at the
time of issuance and sale thereof
will be, duly authorized for
issuance and sale by the Company,
(ii) the Global Note representing
such Book-Entry Note will conform
to the terms of the Indenture,
(iii) such Global Note, when
completed, authenticated and
delivered pursuant to the
Indenture, will constitute the
valid and legally binding
obligation of the Company, and
(iv) upon authentication and
delivery of such Global Note, the
aggregate principal amount of all
Notes initially offered and issued
under the Indenture will not exceed
$[400,000,000] (except for Notes
represented by and authenticated
and delivered in exchange for or in
lieu of Notes in accordance with
the Indenture).
Chase will communicate to DTC and
the Offering Agent through DTC's
Participant Terminal System a
pending deposit message specifying
the following settlement
information:
1. The information set forth in
the Settlement Procedure A.
2. Identification numbers of the
participant accounts
maintained by DTC on behalf of
the Trustee and the Offering
Agent.
3. Identification of the Global
Note as a Fixed Rate Global
Note or Floating Rate Global
Note.
4. Initial Interest Payment Date
for such Note, number of days
by which such date succeeds
the related record date for
DTC purposes (or, in the case
of Floating Rate Notes which
reset daily or weekly, the
date five calendar days
preceding the Interest Payment
Date) and, if then calculable,
the amount of interest payable
on such Interest Payment Date
(which amount shall have been
confirmed by Chase).
5. CUSIP number of the Global
Note representing such Note.
6. Whether such Global Note
represents any other Notes
issued or to be issued in
book-entry form.
DTC will arrange for each pending
deposit message described above to
be transmitted to Standard & Poor's
Corporation, which will use the
information in the message to
include certain terms of the
related Global Note in the
appropriate daily bond report
published by Standard & Poor's
Corporation.
▇. ▇▇▇▇▇ will complete the Global Note
and send a copy thereof by
facsimile to the Company for
verification.
In the event any Note is
incorrectly prepared, Chase shall
promptly prepare a corrected Note
in exchange for such incorrectly
prepared Note.
Chase will authenticate the Global
Note representing such Note.
E. DTC will credit such Note to the
participant account of Chase
maintained by DTC.
▇. ▇▇▇▇▇ will enter an SDFS deliver
order through DTC's Participant
Terminal System instructing DTC
(i) to debit such Note to Chase's
participant account and credit such
Note to Chase's participant account
of the Offering Agent maintained by
DTC and (ii) to debit the
settlement account of the Offering
Agent and credit the settlement
account of Chase maintained by DTC,
in an amount equal to the price of
such Note less such Offering
Agent's discount or underwriting
commission, as applicable. Any
entry of such a deliver order shall
be deemed to constitute a
representation and warranty by
Chase to DTC that (i) the Global
Note representing such Note has
been issued and authenticated and
(ii) Chase is holding such Global
Note pursuant to the Certificate
Agreement.
G. In the case of Notes in book-entry
form sold through the Offering
Agent, as agent, the Offering Agent
will enter an SDFS deliver order
through DTC's Participant Terminal
System instructing DTC (i) to debit
such Note to the Offering Agent's
participant account and credit such
Note to the participant account of
the Participants maintained by DTC
and (ii) to debit the settlement
accounts of such Participants and
credit the settlement account of
the Offering Agent maintained by
DTC in an amount equal to the
initial public offering price of
such Note.
H. Transfers of funds in accordance
with SDFS deliver orders described
in Settlement Procedures F and G
will be settled in accordance with
SDFS operating procedures in effect
on the Settlement Date.
I. Upon receipt, Chase will pay the
Company, by wire transfer of
immediately available funds to an
account specified by the Company to
Chase from time to time, the amount
transferred to Chase in accordance
with Settlement Procedure ▇.
▇. ▇▇▇▇▇ will send a copy of the
Global Note by telecopy to the
Company together with a statement
setting forth the principal amount
of Notes Outstanding as of the
related Settlement Date after
giving effect to such transaction
and all other offers to purchase
Notes of which the Company has
advised Chase but which have not
yet been settled.
K. If such Note was sold through the
Offering Agent, as agent, the
Offering Agent will confirm the
purchase of such Note to the
investor or other purchaser either
by transmitting to the Participant
with respect to such Note a
confirmation order through DTC's
Participant Terminal System or by
mailing a written confirmation to
such investor or other purchaser.
Settlement
Procedures
Timetable: For offers to purchase Notes accepted by
the Company, Settlement Procedures A
through K set forth above shall be
completed as soon as possible following
the trade but not later than the
respective times (New York City time)
set forth below:
SETTLEMENT
PROCEDURE TIME
---------- ----
A 11:00 A.M. on the trade
date or within one hour
following the trade
B 12:00 noon on the trade
date or within one hour
following the trade
C No later than the close
of business on the trade
date
D 9:00 A.M. on Settlement
Date
E 10:00 A.M. on Settlement
Date
F-G No later than 2:00 P.M.
on Settlement Date
H 4:00 P.M. on Settlement
Date
I-K 5:00 P.M. on Settlement
Date
Settlement Procedure H is subject to
extension in accordance with any
extension of Fedwire closing deadlines
and in the other events specified in the
SDFS operating procedures in effect on
the Settlement Date.
If settlement of a Note issued in
book-entry form is rescheduled or
canceled, Chase will deliver to DTC,
through DTC's Participant Terminal
System, a cancellation message to such
effect by no later than 5:00 P.M., New
York City time, on the Business Day
immediately preceding the scheduled
Settlement Date.
Failure to Settle: If Chase fails to enter an SDFS deliver
order with respect to a Note issued in
book-entry form pursuant to Settlement
Procedure F, Chase may deliver to DTC,
through DTC's Participant Terminal
System, as soon as practicable, a
withdrawal message instructing DTC to
debit such Note to the participant
account of Chase maintained at DTC. DTC
will process the withdrawal message,
provided that such participant account
contains a principal amount of the
Global Note representing such Note that
is at least equal to the principal
amount to be debited. If withdrawal
messages are processed with respect to
all the Notes represented by a Global
Note, the Trustee will ▇▇▇▇ such Global
Note "canceled", make appropriate
entries in its records and send
certification of destruction of such
canceled Global Note to the Company.
The CUSIP number assigned to such Global
Note shall, in accordance with CUSIP
Service Bureau procedures, be canceled
and not immediately reassigned. If
withdrawal messages are processed with
respect to a portion of the Notes
represented by a Global Note, Chase will
exchange such Global Note for two Global
Notes, one of which shall represent the
Global Notes for which withdrawal
messages are processed and shall be
canceled immediately after issuance and
the other of which shall represent the
other Notes previously represented by
the surrendered Global Note and shall
bear the CUSIP number of the surrendered
Global Note.
In the case of any Note in book-entry
form sold through the Offering Agent, as
agent, if the purchase price for any
such Note is not timely paid to the
Participants with respect thereto by the
beneficial investor or other purchaser
thereof (or a person, including an
indirect participant in DTC, acting on
behalf of such investor or other
purchaser), such Participants and, in
turn, the related Offering Agent may
enter SDFS deliver orders through DTC's
Participant Terminal System reversing
the orders entered pursuant to
Settlement Procedures F and G,
respectively. Thereafter, Chase will
deliver the withdrawal message and take
the related actions described in the
preceding paragraph. If such failure
shall have occurred for any reason other
than default by the applicable Offering
Agent to perform its obligations
hereunder or under the Distribution
Agreement, the Company will reimburse
such Offering Agent on an equitable
basis for its reasonable loss of the use
of funds during the period when the
funds were credited to the account of
the Company.
Notwithstanding the foregoing, upon any
failure to settle with respect to a Note
in book-entry form, DTC may take any
actions in accordance with its SDFS
operating procedures then in effect. In
the event of a failure to settle with
respect to a Note that was to have been
represented by a Global Note also
representing other Notes, the Trustee
will provide, in accordance with
Settlement Procedure D, for the
authentication and issuance of a Global
Note representing such remaining Notes
and will make appropriate entries in its
records.
PART III: PROCEDURES FOR CERTIFICATED NOTES
Denominations: Unless otherwise provided in the
applicable Pricing Supplement, the
Certificated Notes will be issued in
denominations of $1,000 and integral
multiples thereof.
Payments of
Principal,
Premium, if any,
and Interest: Upon presentment and delivery of the
Certificated Note, Chase upon receipt of
immediately available funds from the
Company will pay the principal of,
premium, if any, and interest on, each
Certificated Note on the Maturity Date
in immediately available funds. All
interest payments on a Certificated
Note, other than interest due on the
Maturity Date, will be made by check
mailed to the address of the person
entitled thereto as such address shall
appear in the Security Register;
provided, however, that Holders of
$10,000,000 or more in aggregate
principal amount of Certificated Notes
(whether having identical or different
terms and provisions) shall be entitled
to receive such interest payments by
wire transfer of immediately available
funds if appropriate wire transfer
instructions have been received in
writing by Chase not less than 15
calendar days prior to the applicable
Interest Payment Date.
Chase will provide monthly to the
Company a list of the principal,
premium, if any, and interest (to the
extent known) to be paid on Certificated
Notes maturing in the next succeeding
month. Chase will be responsible for
withholding taxes on interest paid as
required by applicable law.
Certificated Notes presented to Chase on
the Maturity Date for payment will be
canceled by the Trustee. All canceled
Certificated Notes held by the Trustee
shall be disposed of by the Trustee in
accordance with its customary
procedures, and the Trustee shall
furnish to the Company a certificate
with respect to such disposition.
Settlement
Procedures: Settlement Procedures with regard to
each Certificated Note purchased by an
Agent, as principal, or through an
Agent, as agent, shall be as follows:
A. The Offering Agent will advise the
Company by telephone (and confirm
in writing by facsimile) of the
following Settlement information
with regard to each Certificated
Note:
1. Exact name in which the
Certificated Note(s) is to be
registered (the "Registered
Owner").
2. Exact address or addresses of
the Registered Owner for
delivery, notices and payments
of principal, premium, if any,
and interest.
3. Taxpayer identification number
of the Registered Owner.
4. Principal amount and
Authorized Denomination.
5. (a) Fixed Rate Notes:
(i) Interest Rate.
(ii) Interest Payment
Dates.
(b) Floating Rate Notes:
(i) Whether such Note is
a Regular Floating Rate
Note, Inverse Floating
Rate Note or Floating
Rate/Fixed Rate Note.
(ii) Interest Rate Basis
or Bases.
(iii) Initial Interest
Rate.
(iv) Spread and/or Spread
Multiplier, if any.
(v) Initial Interest
Reset Date and Interest
Reset Dates.
(vi) Interest Payment
Dates.
(vii) Index Maturity, if
any.
(viii) Maximum and/or
Minimum Interest Rates,
if any.
(ix) Day Count Con-
vention.
(x) Calculation Agent.
(xi) Fixed Rate
Commencement Date, if
any, and Fixed Interest
Rate, if any.
(xii) Other terms, if
any.
6. Price to public of such
Certificated Note (or whether
such Note is being offered at
varying prices relating to
prevailing market prices at
time of resale as determined
by the Offering Agent).
7. Trade Date.
8. Settlement Date (Original
Issue Date).
9. Stated Maturity Date.
10. Redemption provisions, if any.
11. Repayment provisions, if any.
12. Net proceeds to the Company.
13. The Offering Agent's discount
or commission.
14. Whether such Note is being
sold to the Offering Agent as
principal or to an investor or
other purchaser through the
Offering Agent acting as agent
for the Company.
15. Such other information
specified with respect to such
Note (whether by Addendum or
otherwise).
B. After receiving such settlement
information from the Offering
Agent, the Company will advise
Chase of the above settlement
information by facsimile
transmission confirmed by
telephone. The Company will
transmit to the Trustee by telex or
facsimile its written request for
the authentication and delivery of
such Certificated Note and the name
of such Agent. Each such request
by the Company shall constitute a
representation and warranty by the
Company to the Trustee that (i) the
Certificated Note is then, and at
the time of issuance and sale
thereof will be, duly authorized
for issuance and sale by the
Company, (ii) the Certificated Note
will conform with the terms of the
Indenture, (iii) such Certificated
Note, when completed, authenticated
and delivered pursuant to the
Indenture, will constitute the
valid and legally binding
obligation of the Company, and
(iv) upon authentication and
delivery of such Certificated Note,
the aggregate principal amount of
all Notes initially offered and
issued under the Indenture will not
exceed $[400,000,000] (except for
Notes represented by and
authenticated and delivered in
exchange for or in lieu of Notes in
accordance with the Indenture).
▇. ▇▇▇▇▇ will complete the
Certificated Note and send a copy
thereof by facsimile to the Company
for verification.
In the event any Note is
incorrectly prepared, Chase shall
promptly prepare a corrected Note
in exchange for such incorrectly
prepared Note.
The Trustee will authenticate the
Certificated Note in the form
approved by the Company and the
Offering Agent, and will make three
copies thereof (herein called
"Stub 1", "Stub 2" and "Stub 3"):
1. Certificated Note with the
Offering Agent's confirmation,
if traded on a principal
basis, or the Offering Agent's
customer confirmation, if
traded on an agency basis.
2. Stub 1 for Trustee.
3. Stub 2 for Offering Agent.
4. Stub 3 for the Company.
D. With respect to each trade, the
Trustee will deliver the
Certificated Note and Stub 2
thereof to the Offering Agent at
the following applicable address:
-----------------------------------
-----------------------------------
-----------------------------------
-----------------------------------
-----------------------------------
-----------------------------------
-----------------------------------
;
----------------------------------
and the Trustee will keep Stub 1.
The Offering Agent will acknowledge
receipt of the Certificated Note
through a broker's receipt and will
keep Stub 2. Delivery of the
Certificated Note will be made only
against such acknowledgment of
receipt. Upon determination that
the Certificated Note has been
authorized, delivered and completed
as aforementioned, the Offering
Agent will wire the net proceeds of
the Certificated Note after
deduction of its applicable
commission to the Company pursuant
to standard wire instructions given
by the Company.
E. In the case of a Certificated Note
sold through the Offering Agent, as
agent, the Offering Agent will
deliver such Certificated Note
(with the confirmation) to the
purchaser against payment in
immediately available funds.
F. The Trustee will send Stub 3 to the
Company.
Settlement
Procedures
Timetable: For offers to purchase Certificated
Notes accepted by the Company,
Settlement Procedures A through F set
forth above shall be completed as soon
as possible following the trade but not
later than the respective times (New
York City time) set forth below:
SETTLEMENT
PROCEDURE TIME
---------- ----
A 11:00 A.M. on the trade
date or within one hour
following the trade
B 12:00 noon on the trade
date or within one hour
following the trade
C-D 2:15 P.M. on Settlement
Date
E 3:00 P.M. on Settlement
Date
F 5:00 P.M. on Settlement
Date
Failure to
Settle: In the case of Certificated Notes sold
through the Offering Agent, as agent, if
an investor or other purchaser of a
Certificated Note from the Company shall
either fail to accept delivery of or
make payment for such Certificated Note
on the date fixed for settlement, the
Offering Agent will forthwith notify the
Trustee and the Company by telephone,
confirmed in writing, and return such
Certificated Note to the Trustee.
The Trustee, upon receipt of such
Certificated Note from the Offering
Agent, will immediately advise the
Company and the Company will promptly
arrange to credit the account of the
Offering Agent in an amount of
immediately available funds equal to the
amount previously paid to the Company by
such Offering Agent in settlement for
such Certificated Note. Such credits
will be made on the Settlement Date if
possible, and in any event not later
than the Business Day following the
Settlement Date; provided that the
Company has received notice on the same
day. If such failure shall have
occurred for any reason other than
failure by such Offering Agent to
perform its obligations hereunder or
under the Distribution Agreement, the
Company will reimburse such Offering
Agent on an equitable basis for its
reasonable loss of the use of funds
during the period when the funds were
credited to the account of the Company.
Immediately upon receipt of the
Certificated Note in respect of which
the failure occurred, the Trustee will
cancel and dispose of such Certificated
Note in accordance with its customary
procedures, make appropriate entries in
its records to reflect the fact that
such Certificated Note was never issued,
and accordingly notify in the Company
writing.
SCHEDULE D
Additional Matters to be Included
in Accountants' Comfort Letter Pursuant to
Section 7(a)(iv) of Distribution Agreement
------------------------------------------
PROSPECTUS CAPTION ITEMS
------------------ -----
"Ratio of Earnings to Fixed "Ratio of Earnings to
Charges" Fixed Charges" and
supporting calculations
shown on Exhibit 12.1 to
the Registration
Statement
FORM 10-K OR 10-Q ITEMS
CAPTION -----
-----------------
"REVIEW OF THE FINANCIAL Changes in total
CONDITION AND RESULTS OF operating revenues
OPERATIONS OF PP&L
RESOURCES, INC. AND
PENNSYLVANIA POWER & LIGHT
COMPANY" -- "Operating
Revenues"
(or similar caption)
"REVIEW OF THE FINANCIAL The Company's actual
CONDITION AND RESULTS OF construction expenditures
OPERATIONS OF PP&L during the year ended
RESOURCES, INC. AND [last year ended] and
PENNSYLVANIA POWER & LIGHT [prior year ended]
COMPANY" -- "Capital
Expenditure Requirements"
(or similar caption)
"SELECTED FINANCIAL AND The Company's times
OPERATING DATA OF interest earned before
PENNSYLVANIA POWER & LIGHT income taxes for [last
COMPANY" -- year ended] and [prior
"Financial Ratios" year ended]
(or similar caption)