EXHIBIT 1-1
COMMONWEALTH EDISON COMPANY
FIRST MORTGAGE __% BONDS, SERIES 99, DUE 201_
AND
FIRST MORTGAGE ___% BONDS, SERIES 100, DUE 201_
UNDERWRITING AGREEMENT
_________ __, 200_
To the Representatives named in
Schedule I hereto of the Underwriters
named in Schedule II hereto
Dear Sirs:
1. Introductory. Commonwealth Edison Company, an Illinois corporation
(the "Company"), proposes to issue and sell from time to time First Mortgage
Bonds (the "Mortgage Bonds"). The Mortgage Bonds will be issued by the Company
under its Mortgage, dated as of July 1, 1923, as amended and supplemented
through the date hereof and as further supplemented by the Supplemental
Indenture dated as of _________, 200_ (the "Supplement") from the Company to BNY
Midwest Trust Company, as trustee (the "Trustee"), and ▇.▇. ▇▇▇▇▇▇▇ as
co-trustee (the "Co-Trustee"). As used herein, the term "Mortgage" refers to the
Company's Mortgage referred to above together with any and all amendments or
supplements thereto, including the Supplement. The Company proposes to sell to
the underwriters named in Schedule II hereto (the "Underwriters") for whom you
are acting as Representative or Representatives (the "Representatives") two
series of Mortgage Bonds, one series in the aggregate principal amount and with
the terms specified in Part A of Schedule I hereto (such series referred to
herein as the "Series 99 Bonds") and the other series in the aggregate principal
amount and with the terms specified in Part B of Schedule I hereto (such series
referred to herein as the "Series 100 Bonds" and, together with the Series 99
Bonds, the "Purchased Bonds").
2. Representations and Warranties of the Company. The Company
represents and warrants to, and agrees with, the Underwriters that:
(a) The Company and ComEd Financing III, a Delaware statutory
trust (the "Trust"), have filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (Registration Nos. 333-99363
and 333-99363-01) relating to (i) debt securities, first mortgage bonds, which
include the Purchased Bonds, and cumulative preference stock of the Company and
(ii) trust preferred securities of the Trust and related guarantees of the
Company (collectively, the "Securities"), and the offering thereof from time to
time in accordance with Rule 415 under the Securities Act of 1933, as amended
(the "Act"), and
have filed such amendments thereto as may have been required to the date hereof.
Such registration statement, as so amended, has been declared effective by the
Commission. Such registration statement and the prospectus relating to the sale
of the Securities by the Company constituting a part thereof, including all
documents incorporated therein by reference, as from time to time amended or
supplemented pursuant to the Act or the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), are referred to herein as the "Registration
Statement," and the prospectus relating to the Securities, including all
documents incorporated therein by reference, as from time to time amended or
supplemented pursuant to the Act or the Exchange Act, including by the
Prospectus Supplement (as defined below), is referred to herein as the
"Prospectus"; provided, however, that a supplement to the Prospectus relating to
an offering of Securities, other than the Purchased Bonds, shall be deemed to
have supplemented the Prospectus only with respect to the offering of the other
Securities to which it relates. All documents filed by the Company with the
Commission pursuant to the Exchange Act and incorporated by reference in the
Registration Statement or the Prospectus, as aforesaid, are hereinafter referred
to as the "Incorporated Documents."
(b) The Registration Statement, the Prospectus and the
Mortgage, at the time the Registration Statement became effective complied, as
of the date hereof comply and as of the Closing Date (as hereinafter defined)
will comply, in all material respects with the applicable requirements of the
Act, the Exchange Act and the Trust Indenture Act of 1939, as amended (the
"Trust Indenture Act"), and the rules and regulations of the Commission under
such Acts; the Incorporated Documents, as of their respective dates of filing
with the Commission, complied and will comply as to form in all material
respects with the requirements of the Exchange Act and the rules and regulations
of the Commission thereunder; the Registration Statement and any amendment
thereof (including the filing of any annual report on Form 10-K), at the time it
became effective, did 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; and the Prospectus, at the time the
Registration Statement became effective did not, as of the date hereof does not
and as of the Closing Date will not, contain an untrue statement of a material
fact or omit to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; provided, however, that the representations and warranties in this
Section 1(b) shall not apply to (i) that part of the Registration Statement
which constitutes the Statements of Eligibility and Qualification (Forms T-1 and
T-2) under the Trust Indenture Act or (ii) statements in or omissions from the
Registration Statement or the Prospectus made in reliance upon and in conformity
with information furnished to the Company in writing by any Underwriter
expressly for use in the Registration Statement or the Prospectus.
(c) PricewaterhouseCoopers LLP, the accountants who certified
certain of the financial statements included or incorporated by reference in the
Prospectus, are independent public accountants as required by the Act and the
rules and regulations of the Commission thereunder.
(d) The financial statements included or incorporated by
reference in the Prospectus present fairly in all material respects the
financial position, results of operations and cash flows of the Company at the
respective dates and for the respective periods specified and, except as
otherwise stated in the Prospectus, such financial statements have been prepared
in
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conformity with generally accepted accounting principles applied on a consistent
basis during the periods involved. The Company has no material contingent
obligation which is not disclosed in the Prospectus.
(e) Except as set forth in or contemplated by the Prospectus,
no material transaction has been entered into by the Company otherwise than in
the ordinary course of business and no materially adverse change has occurred in
the condition, financial or otherwise, of the Company, in each case since the
respective dates as of which information is given in the Prospectus.
(f) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State of
Illinois with corporate power and authority to own its properties and conduct
its business as described in the Prospectus.
(g) Each significant subsidiary of the Company, as defined in
Rule 1-02 of Regulation S-X of the Commission (each a "Significant Subsidiary"),
has been duly incorporated and is validly existing as a corporation in good
standing under the laws of the jurisdiction of its incorporation; all of the
issued and outstanding capital stock of each Significant Subsidiary has been
duly and validly issued and is fully paid and non-assessable; and all of the
capital stock of each Significant Subsidiary is owned by the Company free and
clear of any pledge, lien, encumbrance, claim or equity.
(h) Neither the Company nor any Significant Subsidiary is in
violation of its articles or certificate of incorporation, or in default in the
performance or observance of any material obligation, agreement, covenant or
condition contained in any mortgage or any material contract, lease, note or
other instrument to which it is a party or by which it may be bound, or
materially in violation of any law, administrative regulation or administrative,
arbitration or court order to which it is subject or bound, except in each case
to such extent as may be set forth in the Prospectus; and the execution and
delivery of this Agreement, the incurrence of the obligations herein set forth
and the consummation of the transactions herein contemplated will not conflict
with or constitute a breach of, or default under, the articles of incorporation
or by-laws of the Company or any mortgage, contract, lease, note or other
instrument to which the Company or any Significant Subsidiary is a party or by
which it or any Significant Subsidiary may be bound, or any law, administrative
regulation or administrative, arbitration or court order to which it is subject
or bound.
(i) The Company has filed with the Illinois Commerce
Commission (the "ICC") a petition with respect to the issuance and sale of the
Securities and the ICC has issued its order authorizing and approving such
issuance and sale. No consent of or approval by any other public board or body
or administrative agency, federal or state, is necessary to authorize the
issuance and sale of the Purchased Bonds, except as may be required under the
blue sky laws of any jurisdiction in connection with the purchase and
distribution of the Purchased Bonds by the Underwriters in the manner
contemplated herein and in the Prospectus.
(j) There is no pending or threatened suit or proceeding
before any court or governmental agency, authority or body or any arbitration
involving the Company or any of its
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significant subsidiaries required to be disclosed in the Prospectus which is not
adequately disclosed in the Prospectus.
(k) This Agreement has been duly authorized, executed and
delivered by the Company.
(l) The Mortgage has been duly authorized by the necessary
corporate action and duly qualified under the Trust Indenture Act; and the
Mortgage has been duly authorized and, assuming due authorization, execution and
delivery of the Supplement by the Trustee and due execution and delivery of the
Supplement by the Co-Trustee, when executed and delivered by the Company, will
constitute a legal, valid, binding instrument enforceable against the Company in
accordance with its terms (subject, as to the enforcement of remedies, to
applicable bankruptcy, reorganization, insolvency, fraudulent transfer,
moratorium or other laws affecting creditors' rights generally from time to time
in effect and to general principles of equity).
(m) The issuance and sale of the Purchased Bonds by the
Company in accordance with the terms of this Agreement have been duly
authorized; the Purchased Bonds, when executed and authenticated in accordance
with the provisions of the Mortgage and delivered to and paid for by the
Underwriters, will have been duly executed and delivered by the Company and will
constitute the legal, valid and binding obligations of the Company entitled to
the benefits of the Mortgage (subject, as to the enforcement of remedies, to
applicable bankruptcy, reorganization, insolvency, fraudulent transfer,
moratorium or other laws affecting creditors' rights generally from time to time
in effect and to general principles of equity), and the holders of the Purchased
Bonds will be entitled to the payment of principal and interest as therein
provided; and the statements in the Prospectus under the heading "Description of
Bonds" fairly summarize the matters therein described.
(n) The franchise granted to the Company by the City Council
of the City of Chicago under an ordinance effective January 1, 1992, is valid
and subsisting and duly authorizes the Company to engage in the electric utility
business conducted by it in such City; and the several franchises of the Company
outside the City of Chicago are valid and subsisting and authorize the Company
to carry on its utility business in the several communities, capable of granting
franchises, located in the territory served by the Company outside the City of
Chicago (with immaterial exceptions).
(o) The Company has good and sufficient title to all property
described or referred to in the Mortgage and purported to be conveyed thereby,
subject only to the lien of the Mortgage and permitted liens as therein defined
(except as to property released from the lien of the Mortgage in connection with
the sale or other disposition thereof, and certain other exceptions which are
not material in the aggregate); the Mortgage has been duly filed for recordation
in such manner and in such places as is required by law in order to give
constructive notice of, establish, preserve and protect the lien of the
Mortgage; the Mortgage constitutes a valid, direct first mortgage lien on
substantially all property (including franchises) now owned by the Company,
except property expressly excepted by the terms of the Mortgage, subject to
permitted liens as defined therein; and the Mortgage will constitute a valid,
direct first mortgage lien on all property of the character of that now subject
to the lien of the Mortgage hereafter
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acquired by the Company, subject to permitted liens as defined in the Mortgage,
and to liens, if any, existing or placed on such after-acquired property at the
time of the acquisition thereof.
Any certificate signed by any officer of the Company and
delivered to you or to counsel for the Underwriters in connection with the
offering of the Purchased Bonds shall be deemed a representation and warranty by
the Company to each Underwriter as to the matters covered thereby.
3. Purchase, Offering and Delivery -- Closing Date. Subject to the
terms and conditions herein set forth, the Company agrees to sell to each
Underwriter, and each Underwriter agrees, severally and not jointly, to purchase
from the Company at the purchase price set forth in Schedule I hereto, the
principal amount of each of the Series 99 Bonds and the Series 100 Bonds set
forth opposite each Underwriter's name in Schedule II hereto. It is understood
that the Underwriters propose to offer the Purchased Bonds for sale to the
public as set forth in the Prospectus Supplement (as hereinafter defined)
relating to the Purchased Bonds. The time and date of delivery and payment shall
be the time and date specified in Schedule I hereto; provided, however, that
such time or date may be accelerated or extended by agreement between the
Company and the Representatives or as provided in Section 9 hereof. The time and
date of such delivery and payment are herein referred to as the "Closing Date."
Delivery of the Purchased Bonds shall be made to the Representatives for the
respective accounts of the several Underwriters against payment by the several
Underwriters through the Representatives of the purchase price thereof to or
upon the order of the Company by wire transfer payable in same-day funds to the
account specified by the Company. Delivery of the Purchased Bonds shall be made
through the facilities of The Depository Trust Company
4. Agreements. The Company agrees with the several Underwriters that:
(a) Promptly following the execution of this Agreement, the
Company will cause the Prospectus, including as part thereof a prospectus
supplement relating to the Purchased Bonds (the "Prospectus Supplement"), to be
filed with the Commission pursuant to Rule 424 under the Act, and the Company
will promptly advise the Representatives when such filing has been made. Prior
to such filing, the Company will cooperate with the Representatives in the
preparation of the Prospectus Supplement to assure that the Representatives have
no reasonable objection to the form or content thereof when filed.
(b) The Company will promptly advise the Representatives (i)
when any amendment to the Registration Statement shall have become effective,
(ii) of any request by the Commission for any amendment of the Registration
Statement or amendment or supplement to the Prospectus or for any additional
information, (iii) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or the institution or
threatening of any proceeding for that purpose and (iv) of the receipt by the
Company of any notification with respect to the suspension of the qualification
of the Purchased Bonds for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose. The Company will not file any
amendment to the Registration Statement or amendment or supplement to the
Prospectus unless the Company has furnished the Representatives a copy for their
review prior to filing and will not file any such proposed amendment or
supplement without the consent of the Representatives, which consent shall not
be unreasonably withheld. The
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Company will use its best efforts to prevent the issuance of any such stop order
and, if issued, to obtain as soon as possible the withdrawal thereof.
(c) If, at any time when a prospectus relating to the
Purchased Bonds is required to be delivered under the Act, any event occurs as a
result of which the Prospectus as then amended or supplemented would include an
untrue statement of a material fact or omit to state any material fact necessary
to make the statements therein, in the light of the circumstances under which
they were made, not misleading, or if it shall be necessary to amend or
supplement the Registration Statement or the Prospectus to comply with the Act
or the Exchange Act or the rules and regulations of the Commission under such
Acts, the Company promptly will prepare and file with the Commission, subject to
paragraph (b) of this Section 4, an amendment or supplement that will correct
such statement or omission or an amendment or supplement that will effect such
compliance.
(d) The Company will furnish without charge to (i) each of the
Representatives and counsel for the Underwriters a signed copy of the
Registration Statement (but without exhibits incorporated by reference), as
originally filed, all amendments thereto filed prior to the Closing Date and all
Incorporated Documents (including exhibits, other than exhibits incorporated by
reference), (ii) each other Underwriter a conformed copy of the Registration
Statement (but without exhibits), as originally filed, all amendments thereto
(but without exhibits) and all Incorporated Documents (but without exhibits
other than the Company's latest Annual Report to shareholders) and (iii) each
Underwriter as many copies of the Prospectus, the Prospectus Supplement thereto
and, so long as delivery of a prospectus or supplement thereto by an Underwriter
or dealer may be required under the Act, any amendments thereof and supplements
thereto (but without Incorporated Documents or exhibits), as soon as available
and in such quantities as the Representatives may reasonably request.
(e) The Company will arrange, if necessary, for the
qualification of the Purchased Bonds for sale under the laws of such
jurisdictions within the United States as the Representatives may designate,
provided, that in no event shall the Company be obligated to qualify to do
business in any jurisdiction where it is not now so qualified or take any action
that would subject it to service of process in suits (other than those arising
out of the offering or sale of the Purchased Bonds) in any jurisdiction where it
is not now so subject. The Company will promptly advise the Representatives of
the receipt by the Company of any notification with respect to the qualification
of the Purchased Bonds for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose.
(f) The Company agrees to pay the costs and expenses relating
to the following matters: (i) the preparation of the Prospectus, the issuance of
the Purchased Bonds and the fees of the Trustee or Co-Trustee; (ii) the
preparation, printing or reproduction of the Prospectus and each amendment or
supplement thereto; (iii) the printing (or reproduction) and delivery (including
postage, air freight charges and charges for counting and packaging) of such
copies of the Prospectus, and all amendments or supplements to it, as may be
reasonably requested for use in connection with the offering and sale of the
Purchased Bonds; (iv) the preparation, printing, authentication, issuance and
delivery of certificates for the Purchased Bonds, including any stamp or
transfer taxes in connection with the original issuance and sale of the
Purchased Bonds; (v) the printing (or reproduction) and delivery of this
Agreement, any blue
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sky memorandum and all other agreements or documents printed (or reproduced) and
delivered in connection with the offering of the Purchased Bonds; (vi) any
registration or qualification of the Purchased Bonds for offer and sale under
the securities or blue sky laws of the several states (including filing fees and
the reasonable fees and expenses of counsel for the Underwriters relating to
such registration and qualification); (vii) the transportation and other
expenses incurred by or on behalf of Company representatives in connection with
presentations to prospective purchasers of the Purchased Bonds; (viii) the fees
and expenses of the Company's accountants and counsel (including local and
special counsel); (ix) the fees and expenses of any rating agencies rating the
Purchased Bonds and (x) all other costs and expenses incident to the performance
by the Company of its obligations hereunder.
(g) The Company will, if requested by the Representatives, use
its best efforts to cause the Purchased Bonds to be listed on the New York Stock
Exchange.
(h) During the period beginning from the date of this
Agreement and continuing to and including the later of (i) the termination of
trading restrictions on the Purchased Bonds, as notified to the Company by the
Representatives, and (ii) the Closing Date, the Company will not offer, sell,
contract to sell or otherwise dispose of any debt securities of the Company
which mature more than one year after the Closing Date and which are
substantially similar to the Purchased Bonds, without the prior written consent
of the Representatives; provided, however, that in no event shall the foregoing
period extend more than fifteen calendar days from the date of this Agreement.
5. Conditions to the Obligations of the Underwriters. The
obligations of the Underwriters to purchase and pay for the Purchased Bonds
shall be subject to the accuracy of the representations and warranties on the
part of the Company contained herein as of the date hereof and the Closing Date,
to the accuracy of the statements of the Company made in any certificates
pursuant to the provisions hereof, to the performance by the Company of its
obligations hereunder and to the following additional conditions:
(a) No stop order suspending the effectiveness of the
Registration Statement shall be in effect and no proceedings for that purpose
shall then be pending before, or threatened by, the Commission.
(b) The Company shall have furnished to the Representatives
the opinion of Sidley ▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇, counsel for the Company, dated the
Closing Date and addressed to the Representatives, in form and substance
satisfactory to each of the Representatives and their counsel.
(c) The Representatives shall have received from Winston &
▇▇▇▇▇▇, counsel for the Underwriters, such opinion or opinions, dated the
Closing Date, with respect to the issuance and sale of the Purchased Bonds, the
Mortgage, the Registration Statement, the Prospectus and other related matters
as the Representatives may reasonably require, and the Company shall have
furnished to such counsel such documents as they request for the purpose of
enabling them to pass upon such matters.
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(d) The Company shall have furnished to the Representatives a
certificate of the Company, signed by the Treasurer or Assistant Treasurer of
the Company, dated the Closing Date, to the effect that the signer of such
certificate has carefully examined the Prospectus, any amendment or supplement
to the Prospectus and this Agreement and that:
(i) the representations and warranties of the Company
in this Agreement are true and correct in all material respects on and
as of the Closing Date with the same effect as if made on the Closing
Date, and the Company has complied with all the agreements and
satisfied all the conditions on its part to be performed or satisfied
hereunder at or prior to the Closing Date;
(ii) since the date of the most recent financial
statements included in the Prospectus (exclusive of any amendment or
supplement thereto), there has been no material adverse change in the
financial condition, business or properties of the Company and its
subsidiaries, taken as a whole, whether or not arising from
transactions in the ordinary course of business, except as set forth in
or contemplated by the Prospectus (exclusive of any amendment or
supplement thereto); and
(iii) no stop order suspending the effectiveness of
the Registration Statement has been issued and no proceedings for that
purpose have been initiated or, to his or her knowledge, threatened by
the Commission.
(e) On the date hereof and on the Closing Date, the Company
shall have requested and caused PricewaterhouseCoopers LLP to furnish to the
Representatives letters, dated respectively the date hereof and the Closing
Date, in form and substance satisfactory to the Representatives.
(f) Subsequent to the date of this Agreement, or if earlier,
the respective dates as of which information is given in the Registration
Statement and the Prospectus, there shall not have been (i) any change or
decrease specified in the letter referred to in paragraph (e) of this Section 5
or (ii) any change, or any development involving a prospective change, in or
affecting the financial condition, business or properties of the Company and its
subsidiaries, taken as a whole, whether or not arising from transactions in the
ordinary course of business, except as set forth in or contemplated in the
Prospectus (exclusive of any amendment or supplement thereto) the effect of
which, in any case referred to in clause (i) or (ii) above, is, in the sole
judgment of the Representatives, so material and adverse as to make it
impractical or inadvisable to proceed with the public offering or delivery of
the Series 99 Bonds or the Series 100 Bonds, respectively, as contemplated by
the Prospectus (exclusive of any amendment or supplement thereto).
(g) On the Closing Date, (i) the Series 99 Bonds and the
Series 100 Bonds shall be rated ______ and ______, respectively, by ▇▇▇▇▇'▇
Investors Service, Inc. and ______ and ______, respectively, by Standard &
Poor's Rating Services, and the Company shall have delivered to the
Representatives evidence satisfactory to the Representatives confirming that the
Purchased Bonds have such ratings, and (ii) subsequent to the date of this
Agreement, there shall not have occurred a downgrading in the rating assigned to
the Purchased Bonds or any of the Company's first mortgage bonds or commercial
paper by any "nationally recognized statistical rating agency", as that term is
defined by the Commission for purposes of Rule 436(g)(2) under
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the Act, and no such securities rating agency shall have publicly announced that
it has under surveillance or review, with possible negative implications, its
rating of the Purchased Bonds or any of the Company's other debt securities.
(h) Prior to the Closing Date, the Company shall have
furnished to the Representatives such further information, certificates and
documents as the Representatives may reasonably request.
If any of the conditions specified in this Section 5 shall not
have been fulfilled in all material respects when and as provided in this
Agreement, or if any of the opinions or certificates mentioned above or
elsewhere in this Agreement shall not be in all material respects reasonably
satisfactory in form and substance to the Representatives and their counsel,
this Agreement and all obligations of the Underwriters hereunder may be canceled
at, or at any time prior to, the Closing Date by the Representatives. Notice of
such cancellation shall be given to the Company in writing or by telephone or
facsimile confirmed in writing.
The documents required to be delivered by this Section 5 will
be delivered at the office of counsel for the Company, at Sidley ▇▇▇▇▇▇ ▇▇▇▇▇ &
▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, on the
Closing Date.
6. Conditions of Company's Obligation. The obligation of the
Company to deliver the Purchased Bonds upon payment therefor shall be subject to
the following conditions:
On the Closing Date, the order of the ICC referred to in
subparagraph (i) of Section 2 hereof shall be in full force and effect
substantially in the form in which originally entered; the Mortgage shall be
qualified under the Trust Indenture Act as and to the extent required by such
Act; and no stop order suspending the effectiveness of the Registration
Statement shall be in effect and no proceedings for that purpose shall then be
pending before, or threatened by, the Commission.
In case any of the conditions specified above in this Section
6 shall not have been fulfilled, this Agreement may be terminated by the Company
by delivering written notice of termination to the Representatives. Any such
termination shall be without liability of any party to any other party except to
the extent provided in Sections 7 and 8 hereof.
7. Reimbursement of Underwriters' Expenses. If the sale of
either the Series 99 Bonds or the Series 100 Bonds provided for herein is not
consummated because any condition to the obligations of the Underwriters or the
Company set forth in Section 5 and Section 6 hereof, respectively, is not
satisfied, because of any termination pursuant to Section 10 hereof, or because
of any refusal, inability or failure on the part of the Company to perform any
agreement herein or comply with any provisions hereof other than by reason of a
default by any of the Underwriters, the Company will reimburse the Underwriters
severally upon demand for all out-of-pocket expenses (including reasonable fees
and disbursements of counsel) that shall have been incurred by them in
connection with the proposed purchase and sale of such series of the Purchased
Bonds.
8. Indemnification and Contribution. (a) The Company agrees to
indemnify and hold harmless each Underwriter, the directors, officers, employees
and agents of each
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Underwriter and each person who controls any Underwriter within the meaning of
either the Act or the Exchange Act against any and all losses, claims, damages
or liabilities, joint or several, to which they or any of them may become
subject under the Act, the Exchange Act or other federal or state statutory law
or regulation, at common law or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon any untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement as originally filed or in any amendment
thereof, or in any preliminary prospectus or the Prospectus, or in any amendment
thereof or supplement thereto, or arise out of or are based upon the omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading, and agrees to reimburse each such
indemnified party, as incurred, for any legal or other expenses reasonably
incurred by them in connection with investigating or defending any such loss,
claim, damage, liability or action; provided, however, that the Company will not
be liable in any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon any such untrue statement or alleged
untrue statement or omission or alleged omission made therein in reliance upon
and in conformity with written information furnished to the Company by or on
behalf of any Underwriter through the Representatives specifically for inclusion
therein; provided, further, that the foregoing indemnity with respect to any
untrue statement contained in or omission from any preliminary prospectus shall
not inure to the benefit of any Underwriter (or any of the directors, officers,
employees and agents of such Underwriter or any person controlling such
Underwriter) from whom the person asserting any such loss, claim, damage or
liability purchased any of the Purchased Bonds which are the subject thereof if
such person did not receive a copy of the Prospectus (or the Prospectus as then
amended or supplemented if the Company shall have furnished any amendments or
supplements thereto), excluding the Incorporated Documents, at or prior to the
confirmation of the sale of such Purchased Bonds to such person in any case
where such delivery is required by the Act and the untrue statement or omission
of a material fact contained in such preliminary prospectus was corrected in the
Prospectus (or the Prospectus as so amended or supplemented if the Company shall
have furnished any amendments or supplements thereto), and it is finally
judicially determined that such delivery was required to be made under the Act
and was not so made. This indemnity agreement will be in addition to any
liability which the Company may otherwise have.
(b) Each Underwriter severally and not jointly agrees to
indemnify and hold harmless the Company and each of its directors, officers,
employees and agents, and each person who controls the Company within the
meaning of either the Act or the Exchange Act, to the same extent as the
foregoing indemnity from the Company to each Underwriter, but only with
reference to written information relating to such Underwriter furnished to the
Company by or on behalf of such Underwriter through the Representatives
specifically for inclusion in the documents referred to in the foregoing
indemnity. This indemnity agreement will be in addition to any liability which
any Underwriter may otherwise have. The Company acknowledges that the statements
set forth (i) in the penultimate paragraph of the cover page of the Prospectus
Supplement regarding the delivery of the Purchased Bonds, and, (ii) under the
heading "Underwriting" in the Prospectus Supplement, (A) the third paragraph
related to concessions and discounts; (B) the eighth paragraph related to
stabilization, over-allotments, syndicate covering transactions and penalty
bids; and (iii) the last paragraph related to Internet distributions, constitute
the only information furnished in writing by or on behalf of the Underwriters
for
10
inclusion in the Registration Statement, any preliminary prospectus or the
Prospectus (or in any amendment or supplement thereto).
(c) Promptly after receipt by an indemnified party under this
Section 8 of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying party
under this Section 8, notify the indemnifying party in writing of the
commencement thereof; but the failure so to notify the indemnifying party (i)
will not relieve it from liability under paragraph (a) or (b) above unless and
to the extent it did not otherwise learn of such action and such failure results
in the forfeiture by the indemnifying party of substantial rights and defenses;
and (ii) will not, in any event, relieve the indemnifying party from any
obligations to any indemnified party other than the indemnification obligation
provided in paragraph (a) or (b) above. The indemnifying party shall be entitled
to appoint counsel of the indemnifying party's choice at the indemnifying
party's expense to represent the indemnified party in any action for which
indemnification is sought (in which case the indemnifying party shall not
thereafter be responsible for the fees and expenses of any separate counsel
retained by the indemnified party or parties except as set forth below);
provided, however, that such counsel shall be satisfactory to the indemnified
party. Notwithstanding the indemnifying party's election to appoint counsel to
represent the indemnified party in an action, the indemnified party shall have
the right to employ separate counsel (including local counsel), and the
indemnifying party shall bear the reasonable fees, costs and expenses of such
separate counsel if (i) the use of counsel chosen by the indemnifying party to
represent the indemnified party would present such counsel with a conflict of
interest; (ii) the actual or potential defendants in, or targets of, any such
action include both the indemnified party and the indemnifying party and the
indemnified party shall have reasonably concluded that there may be legal
defenses available to it and/or other indemnified parties which are different
from or additional to those available to the indemnifying party; (iii) the
indemnifying party shall not have employed counsel satisfactory to the
indemnified party to represent the indemnified party within a reasonable time
after notice of the institution of such action; or (iv) the indemnifying party
shall authorize the indemnified party to employ separate counsel at the expense
of the indemnifying party. An indemnifying party will not, without the prior
written consent of the indemnified parties, settle or compromise or consent to
the entry of any judgment with respect to any pending or threatened claim,
action, suit or proceeding in respect of which indemnification or contribution
may be sought hereunder (whether or not the indemnified parties are actual or
potential parties to such claim or action) unless such settlement, compromise or
consent (i) includes an unconditional release of each indemnified party from all
liability arising out of such claim, action, suit or proceeding and (ii) does
not include a statement as to, or an admission of, fault, culpability or a
failure to act by or on behalf of an indemnified party.
(d) In the event that the indemnity provided in paragraph (a)
or (b) of this Section 8 is unavailable or insufficient to hold harmless an
indemnified party under section (a) or (b) above, then the Company and the
Underwriters agree to contribute to the aggregate losses, claims, damages and
liabilities (including legal or other expenses reasonably incurred in connection
with investigating or defending same) (collectively "Losses") to which the
Company and one or more of the Underwriters may be subject in such proportion as
is appropriate to reflect the relative benefits received by the Company on the
one hand and by the Underwriters on the other from the offering of the Series 99
Bonds or the Series 100 Bonds, as the case may be.
11
If the allocation provided by the immediately preceding sentence is unavailable
for any reason, the Company and the Underwriters shall contribute in such
proportion as is appropriate to reflect not only such relative benefits but also
the relative fault of the Company on the one hand and of the Underwriters on the
other in connection with the statements or omissions which resulted in such
Losses, as well as any other relevant equitable considerations. Benefits
received by the Company shall be deemed to be equal to the total net proceeds
from the offering (before deducting expenses) of the Series 99 Bonds or the
Series 100 Bonds, respectively, received by it, and benefits received by the
Underwriters shall be deemed to be equal to the total purchase discounts and
commissions with respect to the Series 99 Bonds or the Series 100 Bonds,
respectively, in each case set forth on the cover of the Prospectus. Relative
fault shall be determined by reference to, among other things, whether any
untrue or any alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information provided by the
Company on the one hand or the Underwriters on the other, the intent of the
parties and their relative knowledge, information and opportunity to correct or
prevent such untrue statement or omission; provided, however, that in no case
shall any Underwriters (except as may be provided in any agreement among the
Underwriters relating to the offering of the Purchased Bonds) be responsible for
any amount in excess of the purchase discount or commission applicable to the
Series 99 Bonds or the Series 100 Bonds, as the case may be, purchased by such
Underwriters hereunder; provided, further, that each Underwriter's obligation to
contribute to Losses hereunder shall be several and not joint. The Company and
the Underwriters agree that it would not be just and equitable if contribution
were determined by pro rata allocation or any other method of allocation which
does not take account of the equitable considerations referred to above.
Notwithstanding the provisions of this paragraph (d), no person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. For purposes of this Section 8, each person who
controls an Underwriter within the meaning of either the Act or the Exchange Act
and each director, officer, employee and agent of an Underwriters shall have the
same rights to contribution as such Underwriter, and each person who controls
the Company within the meaning of either the Act or the Exchange Act and each
officer, director, employee or agent of the Company shall have the same rights
to contribution as the Company, subject in each case to the applicable terms and
conditions of this paragraph (d).
9. Default by an Underwriter. If any one or more Underwriters
shall fail to purchase and pay for any of the Series 99 Bonds or the Series 100
Bonds, as the case may be, agreed to be purchased by such Underwriter or
Underwriters hereunder and such failure to purchase shall constitute a default
in the performance of its or their obligations under this Agreement, the
remaining Underwriters shall be obligated severally to take up and pay for (in
the respective proportions which the amount of the Series 99 Bonds or the Series
100 Bonds, as the case may be, set forth opposite their names in Schedule II
hereto bears to the aggregate amount of the Series 99 Bonds or the Series 100
Bonds, as applicable, set forth opposite the names of all the remaining
Underwriters) the Series 99 Bonds or the Series 100 Bonds, as the case may be,
which the defaulting Underwriter or Underwriters agreed but failed to purchase,
provided, however, that in the event that the aggregate principal amount of
Series 99 Bonds or the Series 100 Bonds, as the case may be, which the
defaulting Underwriter or Underwriters agreed but failed to purchase shall
exceed 10% of the aggregate principal amount of the Series 99 Bonds or the
Series 100 Bonds, as applicable, set forth in Schedule II hereto, the remaining
Underwriters
12
shall have the right to purchase all, but shall not be under any obligation to
purchase any, of the Series 99 Bonds or the Series 100 Bonds, as the case may
be, and if such nondefaulting Underwriters do not purchase all the Series 99
Bonds or the Series 100 Bonds, as applicable, this Agreement will terminate
without liability to any nondefaulting Underwriter or the Company. In the event
of a default by any Underwriter as set forth in this Section 9, the Closing Date
shall be postponed for such period, not exceeding five business days, as the
Representatives shall determine in order that the required changes in the
Registration Statement and the Prospectus Supplement or in any other documents
or arrangements may be effected. Nothing contained in this Agreement shall
relieve any defaulting Underwriter of its liability, if any, to the Company or
any nondefaulting Underwriter for damages occasioned by its default hereunder.
10. Termination. This Agreement shall be subject to
termination in the absolute discretion of the Representatives, by notice given
to the Company prior to delivery of and payment for the Purchased Bonds, if at
any time after the date hereof and prior to the delivery of and payment for the
Purchased Bonds (i) trading in Exelon Corporation's common stock shall have been
suspended by the Commission or the New York Stock Exchange or trading in
securities generally on the New York Stock Exchange shall have been suspended or
limited or minimum prices shall have been established on such Exchange; (ii) a
banking moratorium shall have been declared either by federal or New York State
authorities; (iii) a major disruption of settlements of securities or clearance
services in the United States shall have occurred; or (iv) there shall have
occurred any outbreak or escalation of hostilities, declaration by the United
States of a national emergency or war or other calamity or crisis the effect of
which on financial markets is such as to make it, in the sole judgment of the
Representatives, impracticable or inadvisable to proceed with the offering or
delivery of the Purchased Bonds as contemplated by the Prospectus.
11. Representations and Indemnities to Survive. The respective
agreements, representations, warranties, indemnities and other statements of the
Company or its officers and of the Underwriters set forth in or made pursuant to
this Agreement will remain in full force and effect, regardless of any
investigation made by or on behalf of the Underwriters or the Company or any of
the officers, directors or controlling persons referred to in Section 8 hereof,
and will survive delivery of and payment for the Purchased Bonds. The provisions
of Sections 7 and 8 hereof shall survive the termination or cancellation of this
Agreement.
12. Notices. All communications hereunder will be in writing
and effective only on receipt, and, if sent to the Representatives, will be
mailed, delivered or telefaxed to them at the address specified in Schedule I
hereto, or, if sent to the Company, will be mailed, delivered or telefaxed to
Exelon Corporation, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ Floor, ▇.▇. ▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: Vice President and Treasurer (fax no.:
(▇▇▇) ▇▇▇-▇▇▇▇) and confirmed to the General Counsel of Exelon Corporation (fax
no.: (▇▇▇) ▇▇▇-▇▇▇▇).
13. Successors. This Agreement will inure to the benefit of
and be binding upon the parties hereto and their respective successors and
assigns and the officers and directors and controlling persons referred to in
Section 8 hereof, and no other person will have any right or obligation
hereunder. The term "successors and assigns" as used in this Agreement shall not
include any purchaser, as such purchaser, of any of the Purchased Bonds from any
of the Underwriters.
13
14. Representation of the Underwriters. The Representatives
represent and warrant to the Company that they are authorized to act as the
representatives of the Underwriters in connection with this financing, and the
Representatives' execution and delivery of this Agreement and any action under
this Agreement taken by such Representatives will be binding upon all
Underwriters.
15. Interpretation When No Representatives. In the event no
Underwriters are named in Schedule II hereto, the term "Underwriters" shall be
deemed for all purposes of this Agreement to be the Representative or
Representatives named as such in Schedule I hereto, the principal amount of the
Purchased Bonds to be purchased by any such Underwriter shall be that set
opposite its name in Schedule I hereto and all references to the "Underwriters"
shall be deemed to be the Representative or Representatives named in Schedule I
hereto.
16. Counterparts. This Agreement may be executed in one or
more counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument.
17. Applicable Law. This Agreement will be governed by and
construed in accordance with the laws of the State of New York applicable to
contracts made and to be performed within the State of New York.
14
If the foregoing is in accordance with your understanding of
our agreement, please sign and return to us the enclosed duplicate hereof,
whereupon this Agreement and your acceptance shall represent a binding agreement
between the Company and each of the several Underwriters.
Very truly yours,
COMMONWEALTH EDISON COMPANY
By:
--------------------------
Name:
Title:
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.
Credit Suisse First Boston Corporation
By:
------------------
Name:
Title:
For itself and the other several
Underwriters named in Schedule II
hereto.
15
SCHEDULE I
REPRESENTATIVES: Credit Suisse First Boston Corporation and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ &
Co. Incorporated
A. SERIES 99 BONDS
PURCHASE PRICE AND DESCRIPTION OF SERIES 99 BONDS:
PRINCIPAL AMOUNT: $____________
PURCHASE PRICE: ___%
INTEREST RATE: ___%
INITIAL PUBLIC OFFERING
PRICE: ___%
DEALER DISCOUNT: .___%
REALLOWANCE TO DEALERS: .___%
MATURITY: ________ __, 20__
SINKING FUND PROVISIONS: None
REDEMPTION PROVISIONS:
The Company may, at its option, redeem the Series 99 Bonds in whole or
in part at any time at a redemption price equal to the greater of:
- 100% of the principal amount of the Series 99 Bonds to be
redeemed, plus accrued interest on such Bonds to the redemption
date, or
- as determined by the Quotation Agent, the sum of the present
values of the remaining scheduled payments of principal and
interest on the Series 99 Bonds to be redeemed (not including any
portion of payments of interest accrued as of the redemption date)
discounted to the redemption date on a semi-annual basis at the
Adjusted Treasury Rate plus __ basis points, plus accrued interest
on such Bonds to the redemption date.
16
The redemption price will be calculated assuming a 360-day year consisting of
twelve 30-day months.
B. SERIES 100 BONDS
PURCHASE PRICE AND DESCRIPTION OF SERIES 100 BONDS:
PRINCIPAL AMOUNT: $____________
PURCHASE PRICE: ___%
INTEREST RATE: ___%
INITIAL PUBLIC OFFERING
PRICE: ___%
DEALER DISCOUNT: .___%
REALLOWANCE TO DEALERS: .___%
MATURITY: ________ __, 20__
SINKING FUND PROVISIONS: None
REDEMPTION PROVISIONS:
The Company may, at its option, redeem the Series 100 Bonds in whole or
in part at any time at a redemption price equal to the greater of:
- 100% of the principal amount of the Series 100 Bonds to be
redeemed, plus accrued interest on such Bonds to the redemption
date, or
- as determined by the Quotation Agent, the sum of the present
values of the remaining scheduled payments of principal and
interest on the Series 100 Bonds to be redeemed (not including any
portion of payments of interest accrued as of the redemption date)
discounted to the redemption date on a semi-annual basis at the
Adjusted Treasury Rate plus __ basis points, plus accrued interest
on such Bonds to the redemption date.
The redemption price will be calculated assuming a 360-day year consisting of
twelve 30-day months.
17
C. DEFINITIONS
For purposes of Parts A and B above, the following terms shall have the
following meanings:
"Adjusted Treasury Rate" means, with respect to any redemption date,
the rate per year equal to the semi-annual equivalent yield to maturity of the
Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue
(expressed as a percentage of its principal amount) equal to the Comparable
Treasury Price for the redemption date.
"Business Day" means any day that is not a day on which banking
institutions in New York City are authorized or required by law or regulation to
close.
"Comparable Treasury Issue" means the United States Treasury security
selected by the Quotation Agent as having a maturity comparable to the remaining
term of the Series 99 Bonds or Series 100 Bonds, as applicable, that would be
used, at the time of selection and in accordance with customary financial
practice, in pricing new issues of corporate debt securities of comparable
maturity to the remaining term of those Bonds.
"Comparable Treasury Price" means, with respect to any redemption date:
- the average of the Reference Treasury Dealer Quotations for that
redemption date, after excluding the highest and lowest of the
Reference Treasury Dealer Quotations; or
- if the trustee obtains fewer than three Reference Treasury Dealer
Quotations, the average of all Reference Treasury Dealer
Quotations so received.
"Quotation Agent" means the Reference Treasury Dealer appointed by the
Company.
"Reference Treasury Dealer" means (1) each of Credit Suisse First
Boston Corporation and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated and their respective
successors, unless any of them ceases to be a primary U.S. Government securities
dealer in New York City (a "Primary Treasury Dealer"), in which case the Company
shall substitute another Primary Treasury Dealer; and (2) any other Primary
Treasury Dealer selected by the Company.
"Reference Treasury Dealer Quotations" means, with respect to each
Reference Treasury Dealer and any redemption date, the average, as determined by
the trustee, of the bid and asked prices for the Comparable Treasury Issue
(expressed in each case as a percentage of its principal amount) quoted in
writing to the trustee by that Reference Treasury Dealer at 5:00 p.m., New York
City time, on the third Business Day preceding that redemption date.
18
D. OTHER PROVISIONS RELATING TO THE SERIES 99 BONDS AND THE SERIES 100
BONDS:
TIME AND DATE OF DELIVERY AND PAYMENT:
TIME AND DATE ---
PLACE OF DELIVERY AND PAYMENT:
DELIVERY ---
PAYMENT ---
FUNDS ---
OFFICE FOR EXAMINATION OF PURCHASED BONDS:
Office of Sidley ▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇
Bank One Plaza
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
SPECIFIED DATE PURSUANT TO SECTION 3 OF UNDERWRITING AGREEMENT:
________________________
ADDRESS FOR NOTICES TO REPRESENTATIVES PURSUANT TO SECTION 12 OF UNDERWRITING
AGREEMENT:
c/o Credit Suisse First Boston Corporation
Eleven ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Transactions Advisory Group
19
SCHEDULE II
PRINCIPAL AMOUNT PRINCIPAL AMOUNT
OF SERIES 99 BONDS OF SERIES 100 BONDS
------------------ -------------------
NAME OF UNDERWRITER
Credit Suisse First Boston Corporation............... $ $
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated....................
ABN AMRO Incorporated................................
Banc One Capital Markets, Inc........................
Barclays Capital Inc.................................
BNP Paribas Securities Corp..........................
BNY Capital Markets, Inc.............................
▇.▇. ▇▇▇▇▇▇ Securities Inc...........................
The ▇▇▇▇▇▇▇▇ Capital Group, L.P......................
20