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EXHIBIT 99-6
__________ __, 1995
Mr. J. Xxxxx Xxxxxxxx
Vice President, Finance and
Treasurer
PECO Energy Company
0000 Xxxxxx Xxxxxx (X00-0)
Xxxxxxxxxxxx, XX 00000
Dear Xx. Xxxxxxxx:
This Letter Agreement sets forth the terms and conditions pursuant to
which PECO Energy Company (the "Company") has retained X. X. Xxxx & Co., Inc.
("King") in connection with a proposed exchange offer.
The Company proposes to offer to exchange Trust Receipts of PECO
Energy Capital Trust I (the "Trust"), each representing a ___% Cumulative
Monthly Income Preferred Security, Series B ("Series B Preferred Security") of
PECO Energy Capital, L.P. ("PECO Energy Capital"), for up to 5,400,000
outstanding Depository Shares (the "Depository Shares"), each representing a
one-fourth interest in a share of $7.96 Cumulative Preferred Stock of the
Company and subject to the terms and conditions set forth in the Offering
Circular/Prospectus. The offer to exchange is herein referred to as the
"Exchange Offer".
1. The Company hereby retains King as Information Agent for
advisory and consulting services in connection with the Exchange Offer and
requests and authorizes King to contact, and to provide information with
respect to the Exchange Offer to, holders of the Depositary Shares. For this
purpose, King is authorized to use, and will be supplied by the Company with as
many copies as King may reasonably request of, the following materials filed
with the Securities and Exchange Commission (the "Commission") or publicly
released (or to be filed or publicly released) by the Company in connection
with the Exchange Offer (collectively, the "Exchange Offer Materials"): (i) an
Offering Circular/Prospectus; (ii) a Letter of Transmittal; (iii) press
releases and newspaper advertisements; (iv) letter to securities dealers, banks
and trust companies, and letter from securities dealers, banks and trust
companies to their customers; and (v) any and all amendments or supplements to
any of the foregoing. In no event xxxx Xxxx make any recommendation to
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Mr. J. Xxxxx Xxxxxxxx
PECO Energy Company
__________ __, 1995
Page 2
anyone regarding whether to exchange or refrain from exchanging the Depositary
Shares. If such advice is requested, King will respond that it is not
authorized to give such advice and shall recommend to the person requesting
such advice that such person consult with his or her financial advisor or
broker. In addition, King will cooperate with Xxxxxxx Xxxxx & Co. and Xxxxx
Xxxxxx Inc., as dealer managers for the Exchange Offer (each a "Dealer
Manager"), in all respects reasonably requested by the Dealer Managers.
2. The Company agrees to pay King as compensation for its
services a fee of $6,000 (which includes incoming calls from holders of the
Depository Shares to King), $3,000 of which is due upon execution of this
agreement, and the balance of which is due upon the completion, expiration or
termination, as the case may be, of the Exchange Offer. Further, the Company
agrees to pay King $3.50 for each completed outgoing telephone contact in
connection with the Exchange Offer. In the event the Company requests King to
provide additional services, the Company agrees to pay King reasonable and
customary compensation, in an amount, if any, to be mutually agreed upon. The
Company further agrees to reimburse King for all out-of-pocket expenses
(including counsel's fees and disbursements) incurred by King in retention
hereunder. The Company will meet these expenses from an Expense Advance
Account (the "Account") established with King by an immediate advance of
$4,000. The Account will be replenished by the Company from time-to-time,
promptly upon King's request, up to an additional $1,000 accompanied by a
summary of prior expenses. Once the Company has advanced King an aggregate of
$5,000, any out-of-pocket expenses incurred by King which individually exceed
$200.00 and each aggregate of $1,000 of expenses thereafter, shall be approved
in advance by the Company. Any unused portion of the Account will be returned
promptly to the Company at the end of the term of this engagement. The Company
agrees and acknowledges that its obligation under this paragraph 2 is not in
any way conditional upon the successful consummation of the Exchange Offer or
dependent upon the amount of Preferred Stock acquired by the Company pursuant
to the Exchange Offer.
3. King will check, itemize and pay on behalf of the Company,
from funds provided by King, the charges of brokers and banks for forwarding
material relating to the Exchange Offer to beneficial owners. For this
service, the Company will reimburse King in accordance with paragraph 2, but
shall pay no additional charge.
4. The Company agrees that King shall have the right to pass upon
and approve any and all references to King in the Exchange Offer Materials.
The Company shall not file with the Commission, any other governmental or
regulatory authority or
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Mr. J. Xxxxx Xxxxxxxx
PECO Energy Company
__________ __, 1995
Page 3
body or any court, or otherwise make public, any document containing any
reference to King unless and until King shall have approved such reference.
5. The Company represents and warrants to King that:
(i) this letter agreement is a valid and
binding agreement on the Company's part;
(ii) all necessary corporate action will be duly
taken by the Company prior to the commencement of the Exchange Offer to
authorize the Exchange Offer, and the exchange of Trust Receipts of the Trust,
each representing a Series B Preferred Security of PECO Energy Capital, for up
to 5,400,000 outstanding Depositary Shares, each representing a one-fourth
interest in a share of $7.96 Cumulative Preferred Stock of the Company;
(iii) all Exchange Offer Materials will comply, in
all material respects, with the Securities Exchange Act of 1934, as amended,
and the rules and regulations of the Commission thereunder, and none of the
Exchange Offer Materials, and no other report, filing, document, release or
communication published or filed in connection with the Exchange Offer, will
contain any untrue or misleading statement of a material fact or omit to state
a material fact required to be stated therein or necessary to make the
statements made therein not misleading in light of the circumstance under which
they were made;
(iv) the Exchange Offer, and the exchange of
Trust Receipts of the Trust, each representing a Series B Preferred Security of
PECO Energy Capital, for up to 5,400,000 outstanding Depositary Shares, each
representing a one-fourth interest in a share of $7.96 Cumulative Preferred
Stock of the Company, will comply, in all material respects, with all
applicable requirements of law including the applicable rules or regulations of
any governmental or regulatory authority or body, and no material consent or
approval of, or filing with, any governmental or regulatory authority or body
is required in connection with the making or consummation of the Exchange Offer
(or, if any such material consent, approval or filing is required it will be
duly obtained or made prior to the commencement of the Exchange Offer); and
(v) the Exchange Offer, and the exchange of Trust
Receipts of the Trust, each representing a Series B Preferred Security of PECO
Energy Capital, for up to 5,400,000 outstanding Depositary Shares, each
representing a one-fourth interest in a share of $7.96 Cumulative Preferred
Stock of the Company, and or execution, delivery and performance of this letter
agreement, will not conflict with or result in a breach of or constitute a
default under the Company's articles of
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Mr. J. Xxxxx Xxxxxxxx
PECO Energy Company
__________ __, 1995
Page 4
incorporation or by-laws, or any material agreement, indenture, mortgage, note
or other instrument by which the Company is bound.
6. The Company will advise King promptly of the occurrence of any
event which would cause it not to proceed with, or to withdraw or abandon the
Exchange Offer. The Company will also advise King promptly of any proposal or
requirement to amend or supplement any of the Exchange Offer Materials.
7. The Company hereby agrees to indemnify and hold harmless King,
King's controlling persons, officers, directors, employees, agents and
representatives (collectively, the "Indemnified Persons") from and against any
and all losses, claims, damages, liabilities and expenses whatsoever (including
but not limited to, all counsel fees, disbursements and other out-of-pocket
expenses) incurred by such Indemnified Persons in investigating, preparing to
defend or defending (or appearing or preparing for appearance as a witness in
connection with) any claim, litigation, proceeding, investigation, or
governmental or stock exchange inquiry, commenced or threatened or any claim
whatsoever: (i) arising out of or based upon any facts or circumstances
constituting a violation of, or in conflict with, any of the representations
and warranties set forth in paragraph 5 above; or (ii) arising out of, relating
to or in connection with the Exchange Offer except for the Indemnified
Person's willful misconduct, negligence or a breach of this agreement. The
Company shall reimburse such Indemnified Persons for such counsel fees and
disbursements and other out-of-pocket expenses at such time as they are paid or
incurred by such Indemnified Persons. The foregoing indemnity shall be in
addition to any liability which the Company might otherwise have to the
Indemnified Persons.
8. King agrees to notify the Company promptly of the assertion of
any claim against any of the Indemnified Persons in connection with the
Exchange Offer; and the Company agrees to notify King promptly of the assertion
of any claim against the Company or any of its officers, directors, employees
or agents in connection with the Exchange Offer. At the Company's election,
unless there is a conflict of interest, the defense of the Indemnified Persons
shall be conducted by the Company's counsel who shall be satisfactory to King
and the Indemnified Persons who are defendants in the action or proceeding.
Notwithstanding the Company's election to assume the defense of such action or
proceeding, an Indemnified Person may employ separate counsel to represent it
or defend it in such action or proceeding and the Company will pay the
reasonable fees and expenses of such counsel as set forth above if such
Indemnified Person reasonably determines that there are defenses available to
such Indemnified Person which are different from, or in addition to, those
available to the Company, or if a conflict of interest exists
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Mr. J. Xxxxx Xxxxxxxx
PECO Energy Company
__________ __, 1995
Page 5
which makes representation by counsel chosen by the Company not advisable;
provided however, unless there are actual or potential conflicts of interest
among the Indemnified Persons, the Company will not be required to pay the fees
and expenses of more than one separate counsel for all Indemnified Persons in
any jurisdiction in any single action or proceeding. In any action or
proceeding the defense of which the Company assumes, the Indemnified Persons
shall nevertheless be entitled to participate in such action or proceeding and
retain its own counsel at such Indemnified Person's own expense. The Company
shall not settle or compromise any such action or proceeding without the
Indemnified Person's prior written consent, unless the terms of the settlement
or compromise include an unconditional release of any such Indemnified Person
from all liability or loss arising out of such action or proceeding.
9. The representations and warranties contained in paragraph 5
above and the indemnity agreement contained in paragraphs 7 and 8 above shall
remain operative and in full force and effect regardless of: (i) the
termination or consummation of the Exchange Offer; and (ii) any investigation
made by or on behalf of any party.
10. King agrees to preserve the confidentiality of all non-public
information provided by the Company or its agents for use by King in providing
services under this Agreement and any information developed by King based upon
such non-public information.
11. This agreement shall be construed and enforced in accordance
with the laws of the Commonwealth of Pennsylvania. It is agreed that any
action, suit or proceeding arising out of or based upon this agreement shall be
brought in the United States District Court for the Eastern District of
Pennsylvania or any court of the Commonwealth of Pennsylvania of competent
jurisdiction located in such District, and the parties hereto hereby consent to
the in personam jurisdiction and venue of any such court and to service of
process by certified mail, return receipt requested.
If any provision of this agreement shall be held illegal or invalid by
any court, this agreement shall be construed and enforced as if such provision
had not been contained herein and shall be deemed an agreement between the
parties hereto to the fullest extent permitted by law.
If the foregoing correctly sets forth the understanding between the
Company and King, please indicate acceptance thereof
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Mr. J. Xxxxx Xxxxxxxx
PECO Energy Company
__________ __, 1995
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in the space provided below for the purpose, whereupon this letter and the
Company's acceptance shall constitute a binding agreement between the parties
hereto.
X. X. XXXX & CO., INC.
By:
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Xxxx X. Xxxxx
Vice President
Accepted as of the date first above written:
PECO Energy Company
By:
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J. Xxxxx Xxxxxxxx
Title: Vice President, Finance and
Treasurer
