Exhibit B-4
CPL Transition Funding LLC1
Transition Notes, Series [_________]
Central Power and Light Company
Underwriting Agreement
_________________________________ ___________ ___, 2000
Name of Co-Representatives]
As Representatives of the several
Underwriters named in Schedule I hereto,
c/o __________________,
__________________
__________________
Ladies and Gentlemen:
From time to time, CPL Transition Funding LLC, a limited liability
company formed under the laws of the State of Delaware (the "Issuer"), and
Central Power and Light Company, a Texas corporation (the "Company"), each
proposes to enter into one or more Pricing Agreements (each a "Pricing
Agreement") in the form of Annex I hereto, with such additions and deletions as
the parties thereto may determine, and the Issuer proposes, subject to the terms
and conditions stated herein, to issue and sell to the Underwriters named in
Schedule I to the applicable Pricing Agreement (such firms constituting the
"Underwriters" with respect to such Pricing Agreement and the Securities
specified therein) certain of the Issuer's Transition Notes (the "Securities").
The Securities represented by such Pricing Agreement are referred to as the
"Designated Securities" with respect to such Pricing Agreement.
The terms and rights of any particular issuance of Designated
Securities shall be as specified in the Pricing Agreement relating thereto.
The Issuer was formed pursuant to a limited liability company agreement
dated as of __________, 2000 (the "LLC Agreement"). The Designated Securities
will be issued pursuant to an indenture to be dated as of ________, 2000 (as
amended and supplemented from time to time, [including all Series Supplements
and Trustee's Issuance Certificates,] the "Indenture"), between the Issuer and
________________, a [national association/banking corporation/trust company]
organized under the laws of ________, as indenture trustee (the "Indenture
Trustee"). The Securities will be secured primarily by, and will be payable
from, the Transition Property described in the final financing order (the
"Financing Order") dated __________, 2000 in Docket No. 21528 issued by the
Public Utility Commission of Texas ("PUCT") pursuant to subchapter G of Chapter
39 of the Texas Utilities Code, as amended from time to time (the
"Securitization Law"), and sold to the Issuer by the Company pursuant to a
transition property purchase and sale agreement to be dated as of ________, 2000
(the "Sale Agreement") between the Company, as seller, and the Issuer. Pursuant
to the Indenture, the Issuer has granted to the Indenture Trustee, as trustee
for the benefit of the holders of the Securities, all of its right, title and
interest in and to transition property as security for the Securities. The
Transition Property will be serviced pursuant to a transition property servicing
agreement to be dated as of ________, 2000 (as amended and supplemented from
time to time, the "Servicing Agreement"), between the Company, as servicer, and
the Issuer.
Capitalized terms used and not otherwise defined herein shall have the
respective meanings given to them in the Indenture (including Appendix A
thereto).
1. Particular sales of Designated Securities may be made from time to
time to the Underwriters of such Designated Securities, for whom the firms
designated as representatives of the Underwriters of such Securities in the
Pricing Agreement relating thereto will act as representatives (the
"Representatives"). The term "Representatives" also refers to a single firm
acting as sole representative of the Underwriters and to Underwriters who act
without any firm being designated as their representative. This Underwriting
Agreement shall not be construed as an obligation of the Issuer to sell any of
the Securities or as an obligation of any of the Underwriters to purchase any of
the Securities. The obligation of the Issuer to issue and sell any of the
Securities and the obligation of any of the Underwriters to purchase any of the
Securities shall be evidenced by the Pricing Agreement with respect to the
Designated Securities specified therein. Each Pricing Agreement shall specify
the aggregate principal amount of Designated Securities, the initial public
offering price of such Securities or the manner of determining such price, the
terms of the Designated Securities, the purchase price to the Underwriters of
such Designated Securities, the names of the Underwriters of such Designated
Securities, the names of the Representatives of such Underwriters, the aggregate
principal amount of such Designated Securities to be purchased by each
Underwriter and the commission payable to the Underwriters with respect thereto
and shall set forth the date, time and manner of delivery of such Designated
Securities, and payment therefor. The Pricing Agreement shall also specify (to
the extent not set forth in the registration statement and prospectus with
respect thereto) the terms of such Designated Securities. A Pricing Agreement
shall be in the form of an executed writing (which may be in counterparts), and
may be evidenced by an exchange of telegraphic communications or any other rapid
transmission device designed to produce a written record of communications
transmitted. The obligations of the Underwriters under this Agreement and each
Pricing Agreement shall be several and not joint.
2. Each of the Company and the Issuer, jointly and severally,
represents and warrants to, and agrees with, each of the Underwriters that:
(a) The Issuer and the Securities meet the requirements for
the use of Form S-3 under the Securities Act of 1933, as amended (the
"Act"), and the Issuer has filed a registration statement on Form S-3
(File No. 333-________), as amended by Amendment No. __ thereto (the
"Initial Registration Statement"), in respect of the Securities,
including a prospectus relating to the Securities, and the offering
thereof from time to time in accordance with Rule 415 under the Act
with the Securities and Exchange Commission (the "Commission"); the
Initial Registration Statement and any post-effective amendment
thereto, each in the form heretofore delivered or to be delivered to
the Representatives and, excluding exhibits to such registration
statement but including all documents incorporated by reference in the
prospectus included therein, to the Representatives for each of the
other Underwriters has been declared effective by the Commission in
such form; other than a registration statement, if any, increasing the
size of the offering (a "Rule 462(b) Registration Statement"), filed
pursuant to Rule 462(b) under the Act, which becomes effective upon
filing, no other document with respect to the Initial Registration
Statement or document incorporated by reference therein has heretofore
been filed, or transmitted for filing, with the Commission (other than
prospectuses filed pursuant to Rule 424 under the Act, each in the form
heretofore delivered to the Representatives); and no stop order
suspending the effectiveness of the Initial Registration Statement, and
post-effective amendment thereto or the Rule 462(b) Registration
Statement, if any, has been issued and no proceeding for that purpose
has been initiated or threatened, to the knowledge of the Company or
the Issuer, by the Commission (any preliminary prospectus included in
the Initial Registration Statement or filed with the Commission
pursuant to Rule 424(a) under the Act, is hereinafter called a
"Preliminary Prospectus"; the various parts of the Initial Registration
Statement and the 462(b) Registration Statement, if any, including all
exhibits thereto, the information contained in the form of final
prospectus filed with the Commission pursuant to Rule 424(b) under the
Act in accordance with Section 5(a) hereof and deemed by virtue of Rule
430A under the Act to be part of the Initial Registration Statement at
the time it was declared effective and the documents incorporated by
reference in the prospectus contained in the Initial Registration
Statement at the time such part of the Initial Registration Statement
became effective (but excluding Form T-1), each as amended at the time
such part of the Initial Registration Statement became effective or
such part of the Rule 462(b) Registration Statement, if any, became or
hereafter becomes effective, are hereinafter collectively called the
"Registration Statement"; such final prospectus relating to the
Securities in the form in which it has most recently been filed, or
transmitted for filing, with the Commission on or prior to the date of
this Agreement is hereinafter called the "Prospectus"; any reference
herein to any Preliminary Prospectus or the Prospectus shall be deemed
to refer to and include the documents incorporated by reference therein
pursuant to Item 12 of Form S-3 under the Act, as of the date of such
Preliminary Prospectus or Prospectus, as the case may be; any reference
to any amendment or supplement to any Preliminary Prospectus or the
Prospectus shall be deemed to refer to and include any documents filed
after the date of such Preliminary Prospectus or Prospectus, as the
case may be, under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), and incorporated by reference in such Preliminary
Prospectus or Prospectus, as the case may be; any reference to any
amendment to the Registration Statement shall be deemed to refer to and
include any annual report of the Issuer filed pursuant to Section 13(a)
or 15(d) of the Exchange Act after the effective date of the Initial
Registration Statement that is incorporated by reference in the
Registration Statement; and any reference to the Prospectus as amended
or supplemented shall be deemed to refer to the Prospectus as amended
or supplemented in relation to the applicable Designated Securities in
the form in which it is filed with the Commission pursuant to Rule
424(b) under the Act in accordance with Section 5(a) hereof, including
any documents incorporated by reference therein as of the date of such
filing).
(b) Any documents incorporated by reference in the Prospectus
as amended or supplemented, when they became effective or were filed
with the Commission, as the case may be, conformed in all material
respects to the requirements of the Act or the Exchange Act, as
applicable, and the rules and regulations of the Commission thereunder,
and none of such documents contained an untrue statement of a material
fact or omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading; and any
further documents so filed and incorporated by reference in the
Prospectus or any further amendment or supplement thereto, when such
documents become effective or are filed with the Commission, as the
case may be, will conform in all material respects to the requirements
of the Act or the Exchange Act, as applicable, and the rules and
regulations of the Commission thereunder and will not 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 not
misleading; provided, however, that this representation and warranty
shall not apply to any statements or omissions made in reliance upon
and in conformity with information furnished in writing to the Issuer
by an Underwriter of Designated Securities through the Representatives
expressly for use in the Prospectus as amended or supplemented relating
to such Designated Securities.
(c) The Registration Statement, as of its effective date, and
the Prospectus, at the time it is filed with the Commission, conform
and will conform, as the case may be, and any further amendments or
supplements to the Registration Statement or the Prospectus will
conform, in all material respects with the applicable requirements of
the Act and the Trust Indenture Act of 1939, as amended (the "Trust
Indenture Act"), and the rules and regulations of the Commission
thereunder; neither the Registration Statement nor any amendment
thereto, as of the applicable effective date, contains or will contain
an untrue statement of a material fact or omits or will omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading; and each of the Prospectus and any
amendment or supplement thereto at the time it is filed with the
Commission, does not contain and will not contain an untrue statement
of a material fact and does not omit and will not omit to state a
material fact necessary to make the statements therein in light of the
circumstances under which they were made not misleading; provided,
however, that this representation and warranty shall not apply to the
part of the Registration Statement that constitutes the statement of
eligibility on Form T-1 under the Trust Indenture Act of the Indenture
Trustee and any statements or omissions made in reliance upon and in
conformity with information furnished in writing to the Issuer by an
Underwriter of Designated Securities through the Representatives
expressly for use in the Registration Statement or the Prospectus as
amended or supplemented relating to such Securities.
(d) Since the respective dates as of which information is
given in the Registration Statement and in the Prospectus as amended or
supplemented, there has been no (i) material adverse change in the
condition, financial or otherwise, or in the earnings, business or
operations of the Company and its subsidiaries, taken as a whole, or
the Issuer, or (ii) adverse development concerning the business or
assets of the Company and its subsidiaries, taken as a whole, or the
Issuer, which would result in a material adverse change in the
prospective financial condition or results of operations of the Company
and its subsidiaries, taken as a whole, or the Issuer, except such
changes as are set forth or contemplated in such Registration Statement
or the Prospectus as amended or supplemented (including the financial
statements and notes thereto included or incorporated by reference
therein).
(e) The Issuer has been duly created and is validly existing
as a limited liability company in good standing under the Limited
Liability Company Act of the State of Delaware (the "Delaware LLC Act")
with full power and authority to execute, deliver and perform its
obligations under this Agreement, any Pricing Agreement, the
Securities, the Sale Agreement, the Servicing Agreement, the Indenture,
the Limited Liability Company Agreement (the "LLC Agreement") of the
Issuer and the other agreements and instruments contemplated by the LLC
Agreement (collectively, the Issuer Documents") and to own its
properties and conduct its business as described in the Prospectus as
amended or supplemented, and the Issuer has conducted and will conduct
no business in the future that would be inconsistent with the
description of the Issuer set forth in the Prospectus as amended or
supplemented; the Issuer is not a party to or bound by any agreement or
instrument other than the Issuer Documents; the Issuer has no
liabilities or obligations other than those arising out of the
transactions contemplated by the Issuer Documents and as described in
the Prospectus; based on current law, the Issuer is not classified as
an association taxable as a corporation for United States federal
income tax purposes; and the Issuer is not a party to or subject to any
action, suit or proceeding of any nature other than Docket No. 21528
before the Public Utility Commission of Texas entitled "Application of
Central Power and Light Company for Financing Order to Securitize
Regulatory Assets and Other Qualified Costs".
(f) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Texas, with full corporate power and authority to own its properties
and conduct its business and to own, sell and transfer the Transition
Property, in each case as described in the Prospectus as amended or
supplemented, and has been duly qualified as a foreign corporation for
the transaction of business and is in good standing under the laws of
each other jurisdiction in which it owns or leases properties, or
conducts any business so as to require such qualification except where
the failure to so qualify would not have a material adverse effect on
(i) the financial condition of the Company and its subsidiaries, taken
as a whole or (ii) on the ability of the Company to perform its
obligations under the Sale Agreement, the Servicing Agreement, this
Agreement or any Pricing Agreement (a "Company Material Adverse
Effect").
(g) The Company has no significant subsidiaries, as
"significant subsidiary" is defined in Rule 405 of Regulation C of the
rules and regulations promulgated by the Commission under the Act.
(h) This Agreement has been duly authorized, executed and
delivered by each of the Company and the Issuer; and the Pricing
Agreements conform to the description thereof in the Prospectus.
(i) The Securities have been duly and validly authorized by
the Issuer in accordance with the LLC Agreement, and, when issued and
delivered pursuant to this Agreement and, in the case of the Designated
Securities, pursuant to the Pricing Agreements with respect to such
Designated Securities, such Designated Securities will have been duly
executed, authenticated, issued and delivered and will constitute valid
and legally binding obligations of the Issuer entitled to the benefits
provided by the Indenture, under which they are to be issued, which
will be substantially in the form filed as an exhibit to the
Registration Statement; the Securities and the Indenture will conform
in all material respects to the description thereof contained in the
Registration Statement and the Designated Securities will conform in
all material respects to the description thereof contained in the
Prospectus as amended or supplemented; the issuance of the Securities
is not subject to preemptive or other similar rights; and the terms of
the Securities are valid and binding on the Issuer; the Securities will
be entitled to the same limitation of personal liability extended to
stockholders of private corporations for profit organized under the
General Corporation Law of the State of Delaware.
(j) The Indenture has been duly and validly authorized by the
Issuer and when executed and delivered by the Trustee will have been
duly executed and delivered and will constitute a valid and legally
binding obligation of the Issuer enforceable in accordance with its
terms, except as limited by bankruptcy, insolvency, fraudulent
conveyance, reorganization and other similar laws relating to or
affecting creditors' rights generally and general equitable principles
(whether considered in a proceeding in equity or at law); and the
Indenture has been qualified under the Trust Indenture Act.
(k) Other than as set forth in the Prospectus as amended or
supplemented, there are no legal or governmental proceedings pending
or, to the knowledge of the Issuer or the Company, threatened to which
the Issuer or the Company or any of the Company's subsidiaries is a
party or to which any of the properties of the Company or any of its
subsidiaries is subject, which are required to be described in the
Prospectus, as amended or supplemented; and there are no contracts or
other documents that are required to be described in the Registration
Statement or the Prospectus as amended or supplemented or to be filed
as exhibits to the Registration Statement that are not described or
filed as required.
(l) The Company (i) is in compliance with any and all
applicable foreign, federal, state and local laws and regulations
relating to the protection of human health and safety, the environment
or hazardous or toxic substances or wastes, pollutants or contaminants
("Environmental Laws"), (ii) has received all permits, licenses or
other approvals required of them under applicable Environmental Laws to
conduct their respective businesses and (iii) is in compliance with all
terms and conditions of any such permit, license or approval, except
where such noncompliance with Environmental Laws, failure to receive
required permits, licenses or other approvals or failure to comply with
the terms and conditions of such permits, licenses or approvals would
not, singly or in the aggregate, have a Company Material Adverse
Effect.
(m) Each of the Sale Agreement and the Servicing Agreement has
been duly and validly authorized, executed and delivered by each of the
Company and the Issuer constitute a valid and legally binding
obligation of each of the Company and the Issuer enforceable against
each of the Company and the Issuer in accordance with its terms, except
as limited by bankruptcy, insolvency, fraudulent conveyance,
reorganization and other similar laws relating to or affecting
creditors' rights generally and general equitable principles (whether
considered in a proceeding in equity or at law).
(n) [The LLC Agreement has been duly and validly authorized,
executed and delivered by the Company and constitutes a valid and
legally binding agreement of the Company enforceable in accordance with
its terms, except as limited by bankruptcy, insolvency, fraudulent
conveyance, reorganization and other similar laws relating to or
affecting creditors' rights generally and general equitable principles
(whether considered in a proceeding in equity or at law).]
(o) The Commission has entered an order (the "Order") under
the Public Utility Holding Company Act of 1935, as amended (the "1935
Act"), permitting to become effective the Form U-1
Application-Declaration filed by the Company authorizing the creation
of the Issuer, the sale and transfer of the Transition Property to the
Issuer, and the issue and sale of the Securities by the Issuer. A copy
of such order heretofore entered by the Commission has been or will be
delivered to ______________., on behalf of the Representatives.
(p) The issue and sale of the Securities by the Issuer, the
compliance by the Issuer with all of the provisions of this Agreement,
any Pricing Agreement, the Sale Agreement, the Servicing Agreement and
the Indenture, and the consummation of the transactions contemplated
herein and therein will not conflict with or result in a breach or
violation of any of the terms or provisions of, or constitute a default
under, any indenture or other material agreement or instrument to which
the Issuer is a party or by which the Issuer is bound or to which any
of the property or assets of the Issuer is subject, nor will such
action result in any violation of the provisions of the LLC Agreement
or any statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the Issuer or any
of its properties; and no consent, approval, authorization, order,
license, certificate, permit, registration or qualification of or with
any such court or governmental agency or body, other than the Financing
Order and the Order, which have been duly obtained and are in full
force and effect, is required, for the issue and sale of the Securities
by the Issuer or the consummation by the Issuer of the transactions
contemplated by this Agreement, any Pricing Agreement, the Sale
Agreement, the Servicing Agreement and the Indenture, except such as
have been, or will have been prior to the Time of Delivery (as defined
in Section 4 hereof), obtained under the Act and the Exchange Act, of
the Securities, the qualification of the Indenture under the Trust
Indenture Act, and such consents, approvals, authorizations, orders,
licenses, certificates, permits, registrations or qualifications as
have already been obtained, or as may be required under state
securities or Blue Sky laws in connection with the purchase of the
Securities and the distribution of the Securities by the Underwriters.
(q) The compliance by the Company with all of the provisions
of this Agreement, any Pricing Agreement, the Sale Agreement, the
Servicing Agreement and the LLC Agreement, and the consummation of the
transactions contemplated herein and therein will not conflict with or
result in a breach or violation of any of the terms or provisions of,
or constitute a default under, any indenture or other material
agreement or instrument to which the Company or any of its subsidiaries
is a party or by which the Company or any of its subsidiaries is bound
or to which any of the property or assets of the Company or any of its
subsidiaries is subject, nor will such action result in any violation
of the provisions of the Restated Articles of Incorporation or by-laws
of the Company or the charter or by-laws of any of its subsidiaries or
any statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the Company or any
of its subsidiaries or any of their properties; and no consent,
approval, authorization, order, license, certificate, permit,
registration or qualification of or with any such court or other
governmental agency or body, other than the Financing Order and the
Order, which have been duly obtained and are in full force and effect,
is required for the consummation by the Company of the transactions
contemplated by this Agreement, any Pricing Agreement, the Sale
Agreement, the Servicing Agreement or the LLC Agreement, except the
registration under the Act of the Securities, the qualification of the
Indenture under the Trust Indenture Act and such consents, approvals,
authorizations, orders, licenses, certificates, permits, registrations
or qualifications as have already been obtained, or as may be required
under state securities or Blue Sky laws and in connection with the
purchase of the Securities and distribution of the Securities by the
Underwriters.
(r) None of the Issuer, the Company or any of the Company's
subsidiaries is in violation of its organizational documents or in
default in the performance or observance of any material obligation,
agreement, covenant or condition contained in any indenture or other
material agreement or instrument to which it is a party or by which it
or any of its properties may be bound.
(s) The statements set forth in the Prospectus under the
captions "Description of the Notes" and "Security for the Notes",
insofar as they purport to constitute a summary of the terms of the
Securities and under the captions "Energy Deregulation and New Texas
Market Structure", "Description of the Transition Property", "the Sale
Agreement", "the Servicing Agreement", "Material U.S. Federal Tax
Consequences Taxation", "ERISA Considerations" and under the caption
"Plan of Distribution", insofar as they purport to describe the
provisions of the laws and documents referred to therein, are accurate,
complete and fair.
(t) Neither the Issuer nor the Company is, and after giving
effect to the offering and sale of the Securities and the use of the
proceeds thereof, neither the Issuer nor the Company will be, an
"investment company" or an entity "controlled" by an "investment
company" as such terms are defined in the Investment Company Act of
1940, as amended (the "Investment Company Act").
(u) There are no contracts, agreements or understandings
between the Issuer or the Company and any person that grant such person
the right to require the Issuer or the Company to file a registration
statement under the Act with respect to LLC interests of the Issuer or
any capital stock of the Company owned or to be owned by such person or
to require the Issuer or the Company to include such securities in the
securities registered pursuant to the Registration Statement.
(v) ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP, who have certified certain financial
statements of the Company and the Company's subsidiaries, are
independent public accountants as required by the Act and the rules and
regulations of the Commission thereunder.
[Consider Additional Reps]
Any certificate signed by any officer of the Company or the Issuer and
delivered to you or to counsel for the Underwriters shall be deemed a
representation and warranty by the Company or the Issuer, as the case may be, to
each Underwriter as to the matters covered by such certificate.
3. Upon the execution of the Pricing Agreement applicable to any
Designated Securities, the several Underwriters party to such Pricing Agreement
propose to offer the Designated Securities for sale upon the terms and
conditions set forth in the Prospectus as amended or supplemented.
4. The Designated Securities to be purchased by each Underwriter
hereunder and under the applicable Pricing Agreement, in the form specified in
the related Pricing Agreement, and in such authorized denominations and
registered in such names as _____________ may request upon at least forty-eight
hours' prior notice to the Issuer, shall be delivered by or on behalf of the
Issuer to the Representatives, through the facilities of The Depository Trust
Company ("DTC"), for the accounts of the several Underwriters, against payment
by or on behalf of the several Underwriters of the purchase price therefor by
wire transfer of immediately available funds to the account specified by the
Issuer to the Representatives at least forty-eight hours in advance. The Issuer
will cause the certificates representing the Designated Securities to be made
available for checking and packaging by the Representatives at least twenty-four
hours prior to the Time of Delivery (as defined below). The time, date and place
of such delivery shall be as _______________ and the Issuer may agree upon in
writing. Such time and date are herein called the "Time of Delivery".
5. Each of the Issuer and the Company, jointly and severally agrees
with each of the Underwriters of any Designated Securities:
(a) To prepare the Prospectus as amended and supplemented in
relation to the applicable Designated Securities in a form approved by
the Representatives and to file such Prospectus pursuant to Rule 424(b)
under the Act not later than the Commission's close of business on the
second business day following the execution and delivery of the Pricing
Agreement relating to the applicable Designated Securities, or, if
applicable, such time as may be required by Rule 424A(b) under the Act;
to make no further amendment or any supplement to the Registration
Statement or Prospectus as amended or supplemented after the date of
the Pricing Agreement relating to such Securities and prior to any Time
of Delivery for such Securities which shall be disapproved in writing
by the Representatives for such Securities promptly after reasonable
notice thereof; to advise the Representatives promptly of any such
amendment or supplement after any Time of Delivery for such Securities
and furnish the Representatives with copies thereof; to file promptly
all reports and any definitive proxy or information statements required
to be filed by the Issuer or the Company with the Commission pursuant
to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act for so long
as the delivery of a prospectus is required in connection with the
offering or sale of such Securities, and during such same period to
advise the Representatives, promptly after it receives notice thereof,
of the time when any amendment to the Registration Statement has been
filed or becomes effective or any supplement to the Prospectus or any
amended Prospectus has been filed with the Commission, of the issuance
by the Commission of any stop order or of any order preventing or
suspending the use of any prospectus relating to the Securities, of the
suspension of the qualification of the Securities for offering or sale
in any jurisdiction, of the initiation or threatening of any proceeding
for any such purpose, or of any request by the Commission for the
amending or supplementing of the Registration Statement or Prospectus
or for additional information; and, in the event of the issuance of any
such stop order or of any such order preventing or suspending the use
of any prospectus relating to the Securities or suspending any such
qualification, promptly to use its best efforts to obtain the
withdrawal of such order;
(b) Promptly from time to time to take such action as the
Representatives may reasonably request to qualify the Securities for
offering and sale under the securities laws of such jurisdictions as
the Representatives may request and to comply with such laws so as to
permit the continuance of sales and dealings therein in such
jurisdictions for as long as may be necessary to complete the
distribution of such Securities, provided that in connection therewith
neither the Issuer nor the Company shall be required to qualify as a
foreign corporation or limited liability company or to qualify as a
dealer in securities or to file any general consents to service of
process in any jurisdiction;
(c) To use its best efforts to furnish, prior to 12:00 noon,
New York City time, on the New York Business Day next succeeding the
date of the applicable Pricing Agreement and from time to time during
the period when a prospectus is required to be delivered under the Act
by any Underwriter or dealer, the Underwriters with copies of the
Prospectus as amended or supplemented in New York City in such
quantities as the Representatives may reasonably request, and if, in
the reasonable opinion of counsel to the Company, the delivery of a
prospectus is required at any time in connection with the offering or
sale of the Securities and if at such time any event shall have
occurred as a result of which the Prospectus as then amended or
supplemented would in the reasonable opinion of counsel for the Company
include an untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made when such
Prospectus is delivered, not misleading, or, if for any other reason it
shall be necessary during such period to amend or supplement the
Prospectus or to file under the Exchange Act any document incorporated
by reference in the Prospectus in order to comply in the reasonable
opinion of counsel for the Company with the Act, the Exchange Act or
the respective rules thereunder, to notify the Representatives and upon
their request to file such document and to prepare and furnish without
charge to each Underwriter and to any dealer in securities as many
copies as the Representatives may from time to time reasonably request
of an amended Prospectus or a supplement to the Prospectus, if any,
which will correct such statement or omission or effect such
compliance;
(d) To make generally available to its security holders as
soon as practicable, but in any event not later than eighteen months
after the effective date of the Registration Statement (as defined in
Rule 158(c) under the Act), an earnings statement of the Issuer (which
need not be audited) complying with Section 11(a) of the Act and the
rules and regulations of the Commission thereunder (including, at the
option of the Company, Rule 158);
(e) During the period beginning from the date of the Pricing
Agreement for such Designated Securities and continuing to and
including the earlier of (i) the date, after the Time of Delivery, on
which the distribution of the Securities ceases, as determined by the
Representatives on behalf of the Underwriters, and (ii) 30 days after
the Time of Delivery for such Designated Securities, not to offer,
sell, contract to sell or otherwise dispose of, except as provided
hereunder, any securities of the Issuer, any other beneficial interests
of the Issuer, or any other securities of the Issuer or the Company, as
the case may be, that are substantially similar to the Designated
Securities and including but not limited to any securities that are
convertible into or exchangeable for, or that represent the right to
receive Securities or any substantially similar securities of either
the Issuer or the Company, without the prior consent of the
Representatives;
(f) If the Issuer and the Company elect to rely upon Rule
462(b), to file a Rule 462(b) Registration Statement with the
Commission in compliance with Rule 462(b) by 10:00 p.m. Washington,
D.C. time, on the date of the applicable Pricing Agreement, and at the
time of filing either pay to the Commission the filing fee for the Rule
462(b) Registration Statement or give irrevocable instructions for the
payment of such fee pursuant to Rule 111(b) under the Act;
(g) [To cause the proceeds for the issuance and sale of the
Securities to be applied for the purposes described in the Prospectus
and to furnish or cause to be furnished to the Representatives copies
of all reports on Form SR required by Rule 463 under the Act;]
(h) So long as any of the Securities are outstanding, to
deliver to the Representatives the annual statements of compliance and
the annual independent auditor's servicing reports furnished to the
Issuer or the Indenture Trustee pursuant to the Servicing Agreement or
the Indenture, as applicable, as soon as such statements or reports, as
the case may be, are furnished to the Note Issuer or Indenture Trustee;
(i) So long as any of the Securities are outstanding, to
furnish to the Representatives (i) as soon as available, a copy of each
report filed by it with the Commission under the Exchange Act, or
mailed to holders of Securities, (ii) a copy of any filings with the
PUCT pursuant to the Financing Order or the Securitization Law and
(iii) any information concerning either of the Company or the Issuer,
as the Representatives may reasonably request from time to time;
(j) To the extent that any rating necessary to satisfy the
condition set forth in Section 7(m) hereof is conditioned upon the
furnishing of documents or taking of other actions by the Issuer or the
Company on or after the Closing Date, to furnish such documents and
take such other actions;
(k) To take any and all actions reasonably necessary to
preserve the rights of the holders of Securities with respect to
payment on the Securities out of the amounts represented by Transition
Charges or their equivalent, including, but not limited to, (i) making
appropriate filings with the State of Texas, the PUCT or other
regulatory bodies to defend, preserve and create on behalf of the
holders of the Securities the right to receive payments as provided for
in the Securities and (ii) continuing to deduct and pay over to the
Servicer for the benefit of the Issuer all Transition Charges and TC
Collections or equivalent revenues received by the Company
notwithstanding any declaration of invalidity of the Securitization
Law, in each such case unless otherwise prohibited by applicable law or
judicial or regulatory order in effect at such time.
6. Each of the Issuer and the Company, jointly and severally, covenants
and agrees with the several Underwriters that it will pay or cause to be paid
the following: (i) the fees, disbursements and expenses of the Issuer's and the
Company's counsel and accountants in connection with the registration of the
Securities under the Act, the reasonable fees, disbursements and expenses of
counsel to the Underwriters, and all other expenses in connection with the
preparation, printing and filing of the Registration Statement, any Preliminary
Prospectus and the Prospectus and any amendments and supplements thereto and the
mailing and delivering of copies thereof to the Underwriters and dealers; (ii)
the cost of printing or producing any Agreement among Underwriters, this
Agreement, any Pricing Agreement, the Sale Agreement, the Servicing Agreement,
the Indenture, the LLC Agreement, any Blue Sky Memorandum and any other
documents in connection with the offering, purchase, sale and delivery of the
Securities; (iii) all expenses in connection with the qualification of the
Securities for offering and sale under state securities laws as provided in
Section 5(b) hereof, including the fees and disbursements of counsel for the
Underwriters in connection with such qualification and in connection with the
Blue Sky surveys, not exceeding however $6,000 in the aggregate; (iv) any fees
charged by securities rating services for rating the Securities; (v) the cost
and charges of the transfer agent or registrar; (vi) the cost of qualifying the
Securities with The Depository Trust Company; (vii) all reasonable fees and
expenses of the Managers, the Indenture Trustee and their respective counsel;
and (viii) the cost of preparing certificates for the Securities. It is
understood, however, that, except as provided in this Section and Sections 8 and
11 hereof, the Underwriters will pay all of their own costs and expenses,
transfer taxes on resale of any of the Securities by them, and any advertising
expenses connected with any offers they may make.
7. The obligations of the Underwriters of any Designated Securities
under the Pricing Agreement relating to such Designated Securities shall be
subject, in the discretion of the Representatives, to the condition that all
representations and warranties and other statements of the Issuer and the
Company in or incorporated by reference in the Pricing Agreement relating to
such Designated Securities, and on the part of the Company contained in Article
[ ] of the Sale Agreement and in Section [ ] of the Servicing Agreement, are, at
and as of each Time of Delivery for such Designated Securities, true and
correct, the condition that the Issuer and the Company shall have performed all
of their respective obligations hereunder theretofore to be performed, and the
following additional conditions:
(a) The Prospectus as amended or supplemented in relation to
such Designated Securities shall have been filed with the Commission
pursuant to Rule 424(b) within the applicable time period prescribed
for such filing by the rules and regulations under the Act and in
accordance with Section 5(a) hereof; if the Issuer and the Company have
elected to rely upon Rule 462(b), the Rule 462(b) Registration
Statement shall have become effective by 10:00 p.m. Washington, D.C.
time, on the date of the applicable Pricing Agreement; no stop order
suspending the effectiveness of the Registration Statement or any part
thereof shall have been issued and no proceeding for that purpose shall
have been initiated or, to the knowledge of the Company or the
Representatives, threatened by the Commission; and all requests for
additional information on the part of the Commission shall have been
complied with to the reasonable satisfaction of the Representatives;
(b) Milbank, Tweed, ▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP, counsel for the
Underwriters, shall have furnished to the Representatives such opinion
or opinions (a draft of each such opinion is attached as Annex II(a)
hereto), dated each Time of Delivery for such Designated Securities,
with respect to: insofar as the federal laws of the United States or
the General Corporation Law of the State of Delaware is concerned, the
validity of the Securities; the Registration Statement and the
Prospectus; and other related matters as the Representatives may
reasonably request; and such counsel shall have received such papers
and information as they may reasonably request to enable them to pass
upon such matters;
(c) [▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & Finger, P.A.], special Delaware
counsel for the Company, the Issuer and the Managers, shall have
furnished to the Representatives their written opinion (a draft of such
opinion is attached as Annex II(b) hereto), dated each Time of Delivery
for such Designated Securities, in form and substance satisfactory to
the Representatives, to the effect set forth in such Annex;
(d) [▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & Finger, P.A.], special Delaware
counsel for the Issuer and the Company, shall have also furnished to
the Representatives their written opinion (a draft of such opinion is
attached as Annex II(c) hereto), dated each Time of Delivery for such
Designated Securities, in form and substance satisfactory to the
Representatives, to the effect that: (i) if properly presented to a
Delaware court, a Delaware court applying Delaware law, would conclude
that in order for a person to file a voluntary bankruptcy petition on
behalf of the Issuer, the prior affirmative vote of its Sole Member and
of all of its Managers (including the Independent Manager), as provided
in Section [ ] of the LLC Agreement is required and (ii) the LLC
Agreement constitutes a legal, valid and binding agreement of the Sole
Member and is enforceable against the Sole Member in accordance with
its terms as more fully set forth in such Annex;
(e) Sidley & Austin, counsel for the Issuer and the Company,
shall have furnished to the Representatives their written opinion (a
draft of such opinion is attached as Annex II(d) hereto), dated each
Time of Delivery for such Designated Securities, in form and substance
satisfactory to the Representatives, to the effect set forth in such
Annex;
(f) Sidley & Austin, counsel for the Issuer and the Company,
shall have also furnished to the Representatives their written opinion
(a draft of such opinion is attached as Annex II(e) hereto), dated each
Time of Delivery for such Designated Securities, in form and substance
satisfactory to the Representatives, (i) with respect to the
characterization of the transfer of the Transition Property by the
Company to the Issuer as a "true sale" for bankruptcy purposes and (ii)
to the effect that a court would not order the substantive
consolidation of the assets and liabilities of the Issuer with those of
the Company in the event of a bankruptcy, reorganization or other
insolvency proceeding involving the Company as more fully set forth in
such Annex;
(g) Sidley & Austin, counsel for the Issuer and the Company,
shall have also furnished to the Representatives their written opinion
(a draft of such opinion is attached as Annex II(f) hereto), dated each
Time of Delivery for such Designated Securities, in form and substance
satisfactory to the Representatives, [regarding certain Federal and
Texas constitutional matters relating to the Transition Property] as
more fully set forth in such Annex;
(h) [▇▇▇▇▇▇ & ▇▇▇▇▇▇ L.L.P., special Texas counsel for the
Company and the Issuer, shall have furnished to the Representatives
their written opinion (a draft of such opinion is attached as Annex
II(g) hereto), dated each Time of Delivery for such Designated
Securities, in form and substance satisfactory to the Representatives,
to the effect set forth in such Annex;]
(i) ______________, special counsel for the Indenture Trustee,
shall have furnished to the Representatives their written opinion (a
draft of such opinion is attached as Annex II(h) hereto), dated each
Time of Delivery for such Designated Securities, in form and substance
satisfactory to the Representatives, to the effect set forth in such
Annex;
[List of opinions of counsel to be conformed as various transaction parties
are identified.]
(j) On the date of the Pricing Agreement for such Designated
Securities and at each Time of Delivery for such Designated Securities,
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP shall have furnished to the Representatives
letters, dated the date of the Pricing Agreement and the Time of
Delivery, respectively, to the effect set forth in Annex III hereto,
and with respect to such letter dated such Time of Delivery, as to such
other matters as the Representatives may reasonably request and in form
and substance satisfactory to the Representatives (a draft of the form
of letter to be delivered at a time prior to the execution of the
Pricing Agreement, on the effective date of any post-effective
amendment to the Registration Statement and as of each Time of Delivery
is attached as Annex III hereto);
Subsequent to the respective dates as of which information is
given in each of the Registration Statement and the Prospectus, there
shall not have been any change or decrease specified in the letters
required by subsection (j) of this Section 7 which is, in the judgment
of the Representatives, so material and adverse as to make it
impracticable or inadvisable to proceed with the offering or the
delivery of the Designated Securities as contemplated by the
Registration Statement and the Prospectus;
(k) The LLC Agreement, the Sale Agreement, the Servicing
Agreement and the Indenture and any amendment or supplement to any of
the foregoing shall have been executed and delivered, in each case in a
form reasonably satisfactory to the Representatives;
(l) Since the respective dates as of which information is
given in each of the Registration Statement and in the Prospectus as
amended prior to the date of the Pricing Agreement relating to the
Designated Securities there shall have been no (i) material adverse
change in the condition, financial or otherwise, or in the earnings,
business or operations of the Issuer or the Company and its
subsidiaries, taken as a whole, or (ii) any adverse development
concerning the business or assets of the Issuer or the Company and its
subsidiaries, taken as a whole, which would result in a material
adverse change in the prospective financial condition or results of
operations of the Issuer or the Company and its subsidiaries, taken as
a whole, except such changes as are set forth or contemplated in such
Registration Statement or the Prospectus as amended prior to the date
of the Pricing Agreement relating to the Designated Securities
(including the financial statements and notes thereto included or
incorporated by reference in the Registration Statement);
(m) The Designated Securities shall have been rated in the
highest long-term rating category by each of the Rating Agencies and on
or after the date of the Pricing Agreement relating to the Designated
Securities no downgrading shall have occurred in the rating accorded
the Securities or the Company's debt securities or preferred stock by
any "nationally recognized statistical rating organization," as that
term is defined by the Commission for purposes of Rule 436(g)(2) under
the Act;
(n) On or after the date of the Pricing Agreement relating to
the Designated Securities there shall not have occurred any of the
following: (i) a suspension or material limitation in trading in
securities generally on the New York Stock Exchange; (ii) a suspension
or material limitation in trading in (i) Central and South West
Corporation's common stock on the New York Stock Exchange or (ii) the
Company's or the Issuer's securities; (iii) a general moratorium on
commercial banking activities declared by either Federal, New York
State or Texas authorities; or (iv) the outbreak or escalation of
hostilities involving the United States or the declaration by the
United States of national emergency or war, if the effect of any such
event specified in this Clause (iv) in the judgment of the
Representatives makes it impracticable or inadvisable to proceed with
the public offering or the delivery of the Designated Securities on the
terms and in the manner contemplated in the Prospectus as amended or
supplemented relating to the Designated Securities;
(o) The Issuer and the Company shall have furnished or caused
to be furnished to the Representatives at each Time of Delivery for
Designated Securities certificates of officers of the Company and the
Issuer, satisfactory to the Representatives, as to the accuracy of the
representations and warranties of the Issuer and the Company herein at
and as of such Time of Delivery, as to the performance by the Issuer
and the Company of all of their obligations hereunder to be performed
at or prior to such Time of Delivery, as to the matters set forth in
subsections (a) and (l) of this Section and as to such other matters as
the Representatives may reasonably request;
(p) The Issuance Advice Letter, as filed, shall have become
effective;
(q) On or prior to the Time of Delivery, the Issuer shall have
delivered to the Representatives evidence, in form and substance
reasonably satisfactory to the Representatives, that appropriate
filings have been or are being made in accordance with the
Securitization Law and other applicable law reflecting the grant of a
security interest by the Issuer in the Collateral to the Trustee,
including the filing of the UCC financing statements in the office of
the Secretary of State of the State of Texas and the Secretary of State
of the State of Delaware;
(r) On or prior to the Time of Delivery, the Issuer shall have
delivered to the Representatives evidence, in form and substance
satisfactory to the Representatives, of the PUCT's issuance of the
Financing Order relating to the Transition Property and the related
Issuance Advice Letter;
(s) Prior to the Time of Delivery, the Company shall have
funded the Capital Subaccount with cash in an amount equal to $_______;
(t) The Issuer and the Company shall have furnished or caused
to be furnished to the Rating Agencies at the Time of Delivery such
opinions and certificates as the Rating Agencies may reasonably
request;
(u) Prior to the Time of Delivery, the Issuer and the Company
shall have furnished to the Underwriters such further information,
certificates, opinions and documents as the Underwriters may reasonably
request.
[Consider additional closing conditions.]
If any of the conditions specified in this Section 7 shall not have
been fulfilled when and as provided in this Agreement, or if any of the opinions
and certificates mentioned above or elsewhere in this Agreement shall not be
reasonably satisfactory in form and substance to the Representatives and counsel
for the Underwriters, this Agreement, the applicable Pricing Agreement and all
obligations of the Underwriters hereunder and thereunder may be canceled at, or
at any time prior to, the Time of Delivery by the Representatives. Notice of
such cancellation shall be given by the Representatives to the Issuer and the
Company in writing or by telephone or telegraph confirmed in writing.
8. (a) The Issuer and the Company, jointly and severally, agree to
indemnify and hold harmless each Underwriter, the directors, officers, members
and agents of each Underwriter and each person, if any, who controls any
Underwriter within the meaning of Section 15 of the Securities Act or Section 20
of the Exchange Act from and against any and all losses, claims, damages or
liabilities, joint or several, to which such Underwriter or such controlling
person may become subject under the Securities Act, the Exchange Act or other
Federal or state statutory law or regulation, at common law or otherwise, and to
reimburse each such Underwriter or such controlling person for any reasonable
legal or other expenses (including, to the extent hereinafter provided,
reasonable counsel fees) incurred by it or them in connection with investigating
or defending against any such losses, claims, damages or liabilities, arising
out of or based upon (i) any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement or any amendment thereof,
any preliminary prospectus or the Prospectus (as amended or supplemented if the
Issuer shall have furnished any amendments or supplements thereto) or any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading and/or
(ii) the invalidation (for any reason) of the Securitization Law or the
Financing Order; provided, however, that the indemnity agreement contained in
this subsection (a) shall not apply to any such losses, claims, damages or
liabilities arising out of or based upon (x) any such untrue statement or
alleged untrue statement, or any such omission or alleged omission, if such
statement or omission was made in reliance upon and in conformity with
information furnished in writing to the Issuer by any of the Underwriters for
use in the Registration Statement or the Prospectus or any amendment or
supplement to either thereof or (y) the failure of any Underwriter to deliver
(either directly or through the Representatives) a copy of the Prospectus
(excluding the documents incorporated therein by reference), or of the
Prospectus as amended or supplemented after it shall have been amended or
supplemented by the Company (excluding the documents incorporated therein by
reference), to any person to whom a copy of any preliminary prospectus shall
have been delivered by or on behalf of such Underwriter and to whom any
Designated Securities shall have been sold by such Underwriter, as such delivery
may be required by the Securities Act and the rules and regulations of the
Commission thereunder.
(b) Each of the Underwriters, severally and not jointly, agrees to
indemnify and hold harmless the Issuer and the Company, each of their officers
who signs the Registration Statement, each of their directors, each person who
controls the Issuer or the Company within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act, from and against any and all
losses, claims, damages or liabilities, joint or several, to which any one or
more of them may become subject under the Securities Act, the Exchange Act or
the common law or otherwise, and to reimburse each of them for any reasonable
legal or other expenses (including, to the extent hereinafter provided,
reasonable counsel fees) incurred by them in connection with defending against
any such losses, claims, damages or liabilities of the character above specified
arising out of or based upon (i) any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement or the
Prospectus or any amendment to the Registration Statement or amendment or
supplement to the Prospectus or upon any omission or alleged omission to state
in any thereof a material fact required to be stated therein or necessary to
make the statements therein not misleading if such statement or omission was
made in reliance upon and in conformity with information furnished in writing to
the Issuer by such Underwriter for use in the Registration Statement or the
Prospectus or any amendment or supplement to either thereof or (ii) the failure
of such Underwriter, due to the negligence of such Underwriter, to deliver
(either directly or through the Representatives) a copy of the Prospectus
(excluding the documents incorporated therein by reference), or of the
Prospectus as amended or supplemented after it shall have been amended or
supplemented by the Issuer (excluding the documents incorporated therein by
reference), to any person to whom a copy of any preliminary prospectus shall
have been delivered by or on behalf of such Underwriter and to whom any
Designated Securities shall have sold by such Underwriter, as such delivery may
be required by the Securities Act and the rules and regulations of the
Commission thereunder.
(c) Promptly after receipt by a party indemnified under this Section 8
(an "indemnified party") of notice of the commencement of any action, such
indemnified party will, if a claim in respect thereof is to be made against a
party granting an indemnity under this Section 8 (the "indemnifying party"),
notify the indemnifying party in writing of the commencement thereof; but the
omission so to notify the indemnifying party will not relieve it from any
liability which it may have to any indemnified party otherwise than under this
Section 8. In case any such action is brought against any indemnified party, and
it notifies the indemnifying party of the commencement thereof, the indemnifying
party will be entitled to participate therein, and to the extent that it may
elect by written notice delivered to the indemnified party promptly after
receiving the aforesaid notice from such indemnified party, to assume the
defense thereof (thereby conceding that the action in question is subject to
indemnification by the indemnifying party), with counsel reasonably satisfactory
to such indemnified party, and shall pay the fees and disbursements of such
counsel related to such action; provided, however, that if the defendants in any
such action include both the indemnified party and the indemnifying party and
representation of both parties would be inappropriate due to actual or potential
differing interests between them, the indemnified party or parties shall have
the right to select separate counsel. Upon receipt of notice from the
indemnifying party to such indemnified party of its election so to assume the
defense of such action and approval by the indemnified party of counsel, the
indemnifying party will not be liable to such indemnified party under this
Section 8 for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof unless (i) the
indemnified party shall have employed separate counsel in accordance with the
proviso to the next preceding sentence (it being understood, however, that the
indemnifying party shall not be liable for the expenses of more than one
separate counsel (in addition to any local counsel), approved by the
Representatives in the case of subsection (a), representing the indemnified
parties under subsection (a) who are parties to such action and that all such
fees and expenses shall be reimbursed as they are incurred) or (ii) the
indemnifying party has authorized the employment of counsel for the indemnified
party at the expense of the indemnifying party; and except that such liability
shall be only in respect of the counsel referred to in clause (i) or (ii). The
indemnifying party shall not be liable for any settlement of any proceeding
effected without its written consent, but if settled with such consent or if
there be a final judgment for the plaintiff, the indemnifying party agrees to
indemnify the indemnified party from and against any loss or liability by reason
of such settlement or judgment. No indemnifying party shall, without the prior
written consent of the indemnified party, effect any settlement of any pending
or threatened proceeding in respect of which any indemnified party is or could
have been a party and indemnity could have been sought hereunder by such
indemnified party, unless such settlement includes an unconditional release of
such indemnified party from all liability on claims that are the subject matter
of such proceeding.
(d) If the indemnification provided for in this Section 8 shall be
unenforceable under applicable law by an indemnified party, the Issuer and the
Company, jointly and severally, agree to contribute to such indemnified party
with respect to any and all losses, claims, damages and liabilities for which
such indemnification provided for in this Section 8 shall be unenforceable, in
such proportion as shall be appropriate to reflect the relative fault of the
Issuer and the Company on the one hand and the indemnified party on the other
hand in connection with the statements or omissions which have resulted in such
losses, claims, damages and liabilities, as well as any other relevant equitable
considerations; provided, however, that no indemnified party guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from the Issuer or the Company
if the Issuer or the Company, respectively, is not guilty of such fraudulent
misrepresentation. Relative fault shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact relates to
information supplied by the Issuer or the Company or the indemnified party and
each such party's relative intent, knowledge, access to information and
opportunity to correct or prevent such untrue statement or omission. The Issuer,
the Company and each of the Underwriters agree that it would not be just and
equitable if contribution pursuant to this subparagraph were to be determined
solely by pro rata allocation or by any other method of allocation which does
not take account of the equitable considerations referred to above.
(e) The amount paid or payable by an indemnified party as a result of
the losses, claims, damages and liabilities referred to in the immediately
preceding paragraph shall be deemed to include, subject to the limitations set
forth above, any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any such action or claim.
(f) The indemnity and contribution agreements contained in this Section
8 and the representations and warranties of the Issuer and the Company this
Agreement shall remain operative and in full force regardless of (i) any
termination of this Agreement, (ii) any investigation made by or on behalf of
any Underwriter or any person controlling any Underwriter or by or on behalf of
the Issuer or the Company, their directors or officers or any person controlling
the Issuer or the Company and (iii) acceptance of and payment for any of the
Designated Securities.
9. (a) If any Underwriter shall default in its obligation to purchase
the Designated Securities which it has agreed to purchase under the Pricing
Agreement relating to such Designated Securities, the Representatives may in
their discretion arrange for themselves or another party or other parties to
purchase such Designated Securities on the terms contained herein. If within
twenty-four hours after such default by any Underwriter the Representatives do
not arrange for the purchase of such Designated Securities, then the Issuer and
the Company shall be entitled to a further period of twenty-four hours within
which to procure another party or other parties satisfactory to the
Representatives to purchase such Designated Securities on such terms. In the
event that, within the respective prescribed period, the Representatives notify
the Issuer and the Company that they have so arranged for the purchase of such
Designated Securities, or the Issuer or the Company notifies the Representatives
that it has so arranged for the purchase of such Designated Securities, the
Representatives or the Issuer and the Company shall have the right to postpone a
Time of Delivery for a period of not more than seven days, in order to effect
whatever changes may thereby be made necessary in the Registration Statement or
the Prospectus as amended or supplemented, or in any other documents or
arrangements, and the Issuer and the Company agree to file promptly any
amendments or supplements to the Registration Statement or the Prospectus which
may be required in the opinion of counsel for the Issuer. The term "Underwriter"
as used in this Agreement shall include any person substituted under this
Section with like effect as if such person had originally been a party to the
Pricing Agreement with respect to such Designated Securities.
(b) If, after giving effect to any arrangements for the purchase of the
Designated Securities of a defaulting Underwriter or Underwriters by the
Representatives and the Issuer and the Company as provided in subsection (a)
above, the aggregate principal amount of such Designated Securities which
remains unpurchased does not exceed one-eleventh of the aggregate principal
amount of the Designated Securities to be purchased at the respective Time of
Delivery, then the Issuer and the Company shall have the right to require each
non-defaulting Underwriter to purchase the principal amount of Designated
Securities which such Underwriter agreed to purchase under the Pricing Agreement
relating to such Designated Securities and, in addition, to require each
non-defaulting Underwriter to purchase its pro rata share (based on the
principal amount of Designated Securities which such Underwriter agreed to
purchase under such Pricing Agreement) of the Designated Securities of such
defaulting Underwriter or Underwriters for which such arrangements have not been
made; but nothing herein shall relieve a defaulting Underwriter from liability
for its default.
(c) If, after giving effect to any arrangements for the purchase of the
Designated Securities of a defaulting Underwriter or Underwriters by the
Representatives and the Issuer and the Company as provided in subsection (a)
above, the aggregate principal amount of Designated Securities which remains
unpurchased exceeds one-eleventh of the aggregate principal amount of Designated
Securities to be purchased at the respective Time of Delivery, as referred to in
subsection (b) above, or if the Issuer and the Company shall not exercise the
right described in subsection (b) above to require non-defaulting Underwriters
to purchase Designated Securities of a defaulting Underwriter or Underwriters,
then the Pricing Agreement relating to such Designated Securities shall
thereupon terminate, without liability on the part of any non-defaulting
Underwriter, the Issuer or the Company, except for the expenses to be borne by
the Company and the Issuer as provided in Section 6 hereof and the indemnity and
contribution agreements in Section 8 hereof; but nothing herein shall relieve a
defaulting Underwriter from liability for its default.
10. The respective indemnities, agreements, representations, warranties
and other statements of the Issuer, the Company and the several Underwriters, as
set forth in this Agreement or made by or on behalf of them, respectively,
pursuant to this Agreement, shall remain in full force and effect, regardless of
any investigation (or any statement as to the results thereof) made by or on
behalf of any Underwriter or any controlling person of any Underwriter, or the
Issuer, the Company or any officer, trustee or director or controlling person of
the Issuer or the Company, and shall survive delivery of and payment for the
Securities.
11. If any Pricing Agreement shall be terminated pursuant to Section 9
hereof, neither the Issuer nor the Company shall then be under any liability to
any Underwriter with respect to the Designated Securities with respect to which
such Pricing Agreement shall have been terminated except as provided in Sections
6 and 8 hereof; but, if any Pricing Agreement shall be terminated by the
Underwriters, or any of them, because of any failure or refusal on the part of
the Issuer or the Company to comply with the terms or to fulfill any of the
conditions of the Pricing Agreement (excluding those conditions set forth in
Section 7(m) hereof), or if for any reason the Issuer or the Company shall be
unable to perform its obligations under the Pricing Agreement, the Issuer and
the Company will reimburse the Underwriters or such Underwriters who have so
terminated the Pricing Agreement with respect to themselves, severally, for all
out-of-pocket expenses reasonably incurred by such Underwriters in connection
with the Pricing Agreement or the offering contemplated thereunder. Neither the
Issuer nor the Company shall in any event be liable to any of the Underwriters
for damages on account of loss of anticipated profits.
12. In all dealings hereunder, the Representatives of the Underwriters
of Designated Securities shall act on behalf of each of such Underwriters, and
the parties hereto shall be entitled to act and rely upon any statement,
request, notice or agreement on behalf of any Underwriter made or given by such
Representatives jointly or by such of the Representatives, if any, as may be
designated for such purpose in the Pricing Agreement.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail, telex or
facsimile transmission to the address of the Representatives as set forth in the
Pricing Agreement; and if to the Issuer or the Company shall be delivered or
sent by mail, telex or facsimile transmission to the address of the Issuer or
the Company, respectively, set forth in the Registration Statement, Attention:
Secretary; provided, however that any notice to an Underwriter pursuant to
Section 8(c) hereof shall be delivered or sent by mail, telex or facsimile
transmission to such Underwriter at its address set forth in its Underwriters'
Questionnaire, or telex constituting such Questionnaire, which address will be
supplied to the Issuer and the Company by the Representatives upon request. Any
such statements, requests, notices or agreements shall take effect upon receipt
thereof.
13. This Agreement and each Pricing Agreement shall be binding upon,
and inure solely to the benefit of, the Underwriters, the Issuer, the Company
and, to the extent provided in Sections 8 and 10 hereof, the officers, trustees
and directors of the Company and the Issuer and each person who controls the
Issuer, the Company or any Underwriter, and their respective heirs, executors,
administrators, successors and assigns, and no other person shall acquire or
have any right under or by virtue of this Agreement or any such Pricing
Agreement. No purchaser of any of the Securities from any Underwriter shall be
deemed a successor or assign by reason merely of such purchase.
14. Time shall be of the essence of each Pricing Agreement. As used
herein, the term "business day" shall mean any day when the Commission's office
in Washington, D.C. is open for business.
15. This Agreement and each Pricing Agreement shall be governed by and
construed in accordance with the laws of the State of New York.
16. This Agreement and each Pricing Agreement may be executed by any
one or more of the parties hereto and thereto 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.
If the foregoing is in accordance with your understanding,
please sign and return to us [eight] counterparts hereof.
Very truly yours,
CPL Transition Funding LLC
By: Central Power and Light Company, as Sole Member
By:
Name:
Title:
Central Power and Light Company
By:
Name:
Title:
Accepted as of the date hereof:
___________________________________
[Name of Co-Representatives]
By: ______________________________
(__________________________)
On behalf of each of the Underwriters
ANNEX I
Pricing Agreement
__________________________________
[Name of Co-Representatives]
As Representatives of the several
Underwriters named in Schedule I hereto,
c/o ___________________,
___________________
___________________
Ladies and Gentlemen:
CPL Transition Funding LLC, a limited liability company formed under
the laws of the State of Delaware (the "Issuer") and Central Power and Light
Company, a Texas corporation (the "Company"), each propose, subject to the terms
and conditions stated herein and in the Underwriting Agreement, dated ________,
2000 (the "Underwriting Agreement"), among the Issuer and the Company on the one
hand and _______________ [and (names of Co-Representatives named therein)] on
the other hand, that the Issuer issue and sell to the Underwriters named in
Schedule I hereto (the "Underwriters") the Securities specified in Schedule II
hereto (the "Designated Securities"). Each of the provisions of the Underwriting
Agreement is incorporated herein by reference in its entirety, and shall be
deemed to be a part of this Agreement to the same extent as if such provisions
had been set forth in full herein; and each of the representations and
warranties set forth therein shall be deemed to have been made at and as of the
date of this Pricing Agreement, except that each representation and warranty
which refers to the Prospectus in Section 2 of the Underwriting Agreement shall
be deemed to be a representation or warranty as of the date of the Underwriting
Agreement in relation to the Prospectus (as therein defined), and also a
representation and warranty as of the date of this Pricing Agreement in relation
to the Prospectus as amended or supplemented relating to the Designated
Securities which are the subject of this Pricing Agreement. Each reference to
the Representatives herein and in the provisions of the Underwriting Agreement
so incorporated by reference shall be deemed to refer to you. Unless otherwise
defined herein, terms defined in the Underwriting Agreement are used herein as
therein defined. The Representatives designated to act on behalf of the
Representatives and on behalf of each of the Underwriters of the Designated
Securities pursuant to Section 12 of the Underwriting Agreement and the address
of the Representatives referred to in such Section 12 are set forth in Schedule
II hereto.
An amendment to the Registration Statement, or a supplement to the
Prospectus, as the case may be, relating to the Designated Securities, in the
form heretofore delivered to you is now proposed to be filed with the
Commission.
Subject to the terms and conditions set forth herein and in the
Underwriting Agreement incorporated herein by reference, the Issuer agrees to
issue and sell to each of the Underwriters, and each of the Underwriters agrees,
severally and not jointly, to purchase from the Issuer, at the time and place
and at the purchase price to the Underwriters set forth in Schedule II hereto,
the respective principal amount of each class of Designated Securities set forth
opposite the name of such Underwriter in Schedule I hereto.
If the foregoing is in accordance with your understanding, please sign
and return to us [eight] counterparts hereof, and upon acceptance hereof by you,
on behalf of each of the Underwriters, this letter and such acceptance hereof,
including the provisions of the Underwriting Agreement incorporated herein by
reference, shall constitute a binding agreement between each of the Underwriters
and the Issuer and the Company, duly authorized, executed and delivered by the
Company and the Issuer. It is understood that your acceptance of this letter on
behalf of each of the Underwriters is or will be pursuant to the authority set
forth in a form of Agreement among Underwriters, the form of which shall be
submitted to the Issuer and the Company for examination but without warranty on
the part of the Representatives as to the authority of the signers thereof.
Very truly yours,
CPL Transition Funding LLC
By: Central Power and Light Company, as Sole Member
By:
Name:
Title:
Central Power and Light Company
By:
Name:
Title:
Accepted as of the date hereof:
_______________________________
[Name of Co-Representatives]
By:
(_____________________)
On behalf of each of the Underwriters
SCHEDULE I
Amount of Designated
Underwriter Securities to be Purchased
Class [ ] Class [ ] Class [ ]
____________________________
[Names of other Underwriters]
Total
SCHEDULE II
Title of Designated Securities:
Amount of Designated Securities:
Class [ ]:
Class [ ]:
Class [ ]:
Initial Offering Price to Public:
[$___ per Transition Bond] [formula]
Purchase Price by Underwriters:
[$____ per Transition Bond][formula]
[Commission Payable to Underwriters:
$_________ per Transition Bond in Federal (same day) Funds [by wire transfer]]
Form of Designated Securities:
Book-entry only form represented by one or more global securities deposited with
The Depository Trust Company ("DTC") or its designated custodian for trading in
the Same Day Funds Settlement System of DTC, and to be made available for
checking by the Representatives at least twenty-four hours prior to the Time of
Delivery at the office of DTC. Definitive Designated Securities will be
available only under limited circumstances described in the Prospectus as
amended or supplemented.
Specified Funds for Payment of Purchase Price:
[Immediately available funds]]
[Describe any blackout provisions with respect to the Designated Securities]
Time of Delivery:
10:00 a.m. (New York City time), _________, 2000 (or such later date not later
than five business days after such specified date as the Representatives shall
designate)
Closing Location:
Milbank, Tweed, ▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP
▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Names and addresses of Representatives:
Designated Representatives
Address for Notices, etc.:
[Other Terms]*:
--------------------------
* A description of particular tax, accounting or other unusual features
(including any event risk provisions) of the Designated Securities should
be set forth, or referenced to an attached or accompanying description, if
necessary, to ensure agreement as to the terms of the Designated Securities
to be purchased and sold. Such a description might appropriately be in the
form in which such features will be described in the Prospectus Supplement
for the offering.
ANNEX II
Form of Various Opinions of Counsel
[TO COME]
ANNEX III
Form of letter of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP
to be delivered pursuant to Section 7(j)
[TO COME]
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1This is an initial draft Underwriting Agreement. It is subject to negotiation
by the parties and to any changes necessary to reflect the final Financing
Order to be issued by the Public Utilities Commission of Texas.