EXHIBIT 8 (c)
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WEST TEXAS UTILITIES COMPANY
FIRST MORTGAGE BONDS
UNDERWRITING AGREEMENT
October 18, 0000
Xxxx Xxxxx Utilities Company
000 Xxxxxxx
Xxxxxxx, Xxxxx 00000
Dear Sirs:
We (the "Managers") understand that West Texas Utilities Company, a
Texas corporation (the "Company"), proposes to issue and sell $80,000,000
aggregate principal amount of its First Mortgage Bonds, Series U (the
"Offered Securities"). Subject to the terms and conditions set forth herein
or incorporated by reference herein, the Company hereby agrees to sell and
the underwriter or underwriters named in Schedule I hereto (such underwriter
or underwriters being herein called the "Underwriters") agree to purchase,
severally and not jointly, the principal amounts of such Offered Securities
set forth opposite their names in Schedule I hereto at 98.833% of their
principal amount plus accrued interest, if any, from October 24, 1995 to the
date of payment and delivery.
The Underwriters will pay for such Offered Securities at the offices of
Milbank, Tweed, Xxxxxx & XxXxxx, 0 Xxxxx Xxxxxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx
00000 at 10:00 a.m., New York Time, on October 24, 1995 or at such other
place and time, not later than October 31, 1995, as shall be mutually
agreed. The Offered Securities shall be concurrently delivered to the
Underwriters at the office of X.X. Xxxxxx Securities Inc., New York, New
York. In accordance with Rule 15c6-1(d) promulgated under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), the Underwriters
agree to this alternative date for the payment of funds and delivery of the
Offered Securities in lieu of that required by paragraphs (a) and (c) of
Rule 15c6-1 under the Exchange Act.
The Offered Securities shall have the following terms:
Maturity: October 1, 2005
--------
Interest Rate: 6-3/8%
-------------
Mandatory and Optional
Sinking Fund Provisions: As described in the Prospectus and
----------------------- applicable Prospectus Supplement for
the Offered Securities
Optional Redemption Provisions: As described in the Prospectus and
------------------------------ applicable Prospectus Supplement for
the Offered Securities
Interest Payment Dates: April 1 and October 1, commencing
---------------------- April 1, 1996.
Address for Notices
to Managers under
Underwriting Agreement: X.X. Xxxxxx Securities Inc.
---------------------- 00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Payment Method: Immediately available Federal funds
--------------
All the provisions contained in the document entitled West Texas Utilities
Company Underwriting Agreement Standard Provisions (Bonds-Shelf), dated October
18, 1995, a copy of which you and we have previously received, are herein
incorporated by reference in their entirety and shall be deemed to be a part
of this Underwriting Agreement to the same extent as if such provisions had
been set forth in full herein. References herein and therein to numbered
sections of the Underwriting Agreement shall mean the numbered sections of
such Standard Provisions.
Please confirm your agreement by having an authorized officer sign a copy
of this Underwriting Agreement in the space set forth below and returning the
signed copy to us. This Underwriting Agreement may be signed in any number of
counterparts with the same effect as if the signature thereto and hereto were
upon the same instrument. It is understood that our acceptance of this
agreement 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 Company for examination, upon request.
Very truly yours,
X.X. XXXXXX SECURITIES INC.
By:
By:______________________________
Title:___________________________
Accepted:
WEST TEXAS UTILITIES COMPANY
By:_______________________________
Title:____________________________
Schedule I
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Principal
Amount of
Offered
Underwriters Securities
------------ ----------
X.X. Xxxxxx Securities Inc. $40,000,000
Xxxxx Xxxxxx Inc. 40,000,000
-----------
Total $80,000,000
xxxxxxxxxxx
XXXX XXXXX UTILITIES COMPANY
UNDERWRITING AGREEMENT
STANDARD PROVISIONS (BONDS-SHELF)
Dated October 18, 1995
From time to time West Texas Utilities Company, a Texas corporation
(the "Company"), may enter into one or more underwriting agreements that
provide for the sale of designated securities to the several underwriters
named therein. The standard provisions set forth herein may be incorporated
by reference in any such underwriting agreement and any such underwriting
agreement, including the provisions incorporated therein by reference, is
herein referred to as the "Underwriting Agreement".
The Company proposes to issue the series of First Mortgage Bonds
specified in the Underwriting Agreement (the "Offered Securities") pursuant
to the provisions of its Indenture dated August 1, 1943 as supplemented and
as the same may from time to time be amended or supplemented (the
"Indenture"), to Xxxxxx Trust and Savings Bank and X. Xxxxxxxxx, as
Trustees. The Offered Securities will have the terms and rights, including
the maturity, rate and times of payment of interest, selling price and
redemption terms, as set forth in the Underwriting Agreement and Prospectus
(as hereinafter defined). The Underwriting 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.
1. Representations and Warranties of the Company.
(a) The Company has filed with the Securities and Exchange Commission
(the "Commission") registration statements on Form S-3 (File Nos. 33-50633
and 33-60801), including a prospectus, relating to the Offered Securities,
and the offering thereof from time to time in accordance with Rule 415 under
the Securities Act of 1933, as amended (the "Securities Act"), and such
registration statements have become effective. The Company has prepared or
will promptly prepare for filing with, or transmission for filing to, the
Commission, pursuant to Rule 424 under the Securities Act, a Prospectus
Supplement (the "Supplement") for the purpose of supplying information in
respect of the public offering of the Offered Securities, the names of the
underwriter or group of underwriters and other matters. Said registration
statements, as amended at the respective times they became effective,
including the information contained in the final prospectus filed with the
Commission pursuant to Rule 424(b) of the Securities Act, and the
prospectus, as supplemented by the Supplement, relating to the Offered
Securities in final form as filed with the Commission pursuant to Rule 424
under the Securities Act, are hereinafter called the "Registration
Statements" and the "Prospectus", respectively. The term "Basic Prospectus"
means the prospectus included in Registration Statement No. 33-60801, which,
pursuant to Rule 429 under the Securities Act, covers $20,000,000 of the
Company's First Mortgage Bonds previously registered and unissued under the
Company's Registration Statement on Form S-3 (File No. 33-50633). The term
"preliminary prospectus" means a preliminary prospectus supplement, if any,
relating to the Offered Securities together with the Basic Prospectus.
Whenever the word "Registration Statements", "registration statements",
"Prospectus", "preliminary prospectus" or "prospectus" is used herein it
shall be deemed to include all documents incorporated therein by reference
pursuant to the requirements of Form S-3 under the Securities Act (the
"Incorporated Documents").
(b) The Commission has entered a supplemental order dated July 26,
1995, under the Public Utility Holding Company Act of 1935, as amended (the
"Holding Company Act"), permitting to become effective the Form U-1
Application-Declaration filed by the Company with respect to the issue and
sale of the Offered Securities. A copy of such supplemental order
heretofore entered by the Commission has been or will be delivered to the
Underwriters.
(c) Except as otherwise contemplated herein, no approval,
authorization, consent, certificate or order of any State commission or
regulatory authority is necessary with respect to the issuance or the sale
of the Offered Securities by the Company.
(d) The Basic Prospectus relating to the Offered Securities as
originally filed, or as a part of any amendment thereto, any preliminary
prospectus at the time of its issuance, and the Registration Statements and
the Prospectus and any amendment or supplement to the Registration
Statements or the Prospectus as of their effective or issue dates, and as of
the Closing Date (as hereinafter defined), complied or will comply, in each
case in all material respects, with the provisions of the Securities Act and
the Trust Indenture Act of 1939, as amended (the "Trust Indenture Act"), and
the rules and regulations of the Commission under said Acts, and neither the
Registration Statements nor any amendments thereto contain or will contain
an untrue statement of a material fact or omit or will omit to state a
material fact required to be stated therein or necessary in order to make
the statements therein not misleading and the Basic Prospectus, any
preliminary prospectus, the Prospectus or any amendment or supplement
thereto does not include and will not include an untrue statement of a
material fact and does not omit and will not omit to state a material fact
required to be stated therein or necessary to make the statements therein in
light of the circumstances under which they were made not misleading;
provided that the foregoing representations and warranties in this
subsection (d) shall not apply to omissions from the Registration Statements
or Prospectus resulting from the failure of any of the Underwriters to
furnish the Company with the information pertaining to such Underwriters and
the underwriting of the Offered Securities required to complete the
Registration Statements or the Prospectus, to statements in the Form T-1 or
Form T-2 filed by the Trustees as exhibits to the Registration Statements or
to statements in or omissions from the Prospectus made in reliance upon and
in conformity with information furnished in writing to the Company by any of
the Underwriters for use in connection with the preparation of the
Prospectus. The Incorporated Documents that were filed under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), complied at their
respective times of filing, and any documents deemed to be incorporated in
the Registration Statements and Prospectus at all times during which a
prospectus is required to be delivered under the Securities Act will comply
at their respective times of filing, with the provisions of the Exchange Act
and the rules and regulations of the Commission thereunder.
(e) Except as the Company may have furnished supplemental information
to each prospective Underwriter or to the Managers prior to the receipt of
proposals to purchase the Offered Securities as to matters to be reflected
in the Prospectus, since the respective dates as of which information is
given in the Registration Statements and in the Prospectus, there has been
no (A) material adverse change in the condition, financial or otherwise, or
in the earnings of the Company, or (B) adverse development concerning the
Company's business or assets which would result in a material adverse change
in its prospective financial condition or results of operations, except such
changes as are set forth or contemplated in such Registration Statements
(including the financial statements and notes thereto included or
incorporated by reference in the Registration Statements) or the Prospectus.
(f) The Indenture adequately describes all or substantially all the
permanent fixed properties now owned by the Company, except certain property
excepted from the lien of the Indenture and property of the character
expressly excluded from such lien by the terms of the Indenture, and except
any property constructed or acquired by the Company subsequent to the date
of execution of the Supplemental Indenture creating and providing for the
issuance of the Offered Securities.
(g) At or prior to the acceptance by the Company of a proposal for the
purchase of the Offered Securities, the Company will have taken all
corporate action necessary to be taken by it to authorize the acceptance of
such proposal and, at or before the Closing Date, will have taken all
corporate action necessary to be taken by it to authorize the performance by
it of all obligations on its part to be performed under the Underwriting
Agreement; and the consummation of the transactions contemplated in, and the
fulfillment of the terms of, the Underwriting Agreement will not result in
a breach of any of the terms and provisions of, or constitute a default
under, any indenture, mortgage, deed of trust or other agreement or
instrument to which the Company is a party at the Closing Date, or the
Restated Articles of Incorporation of the Company, as amended, or any order,
rule or regulation applicable to the Company of any court or of any state or
Federal regulatory body or administrative agency having jurisdiction over
the Company or over its property.
(h) Xxxxxx Xxxxxxxx LLP are independent accountants with respect to
the Company as required by the Securities Act and the applicable rules and
regulations thereunder.
2. Purchase, Sale and Delivery of Offered Securities.
The Company is advised by the Managers that the Underwriters propose to
make a public offering of their respective portions of the Offered
Securities as soon after the Underwriting Agreement is entered into as in
the Managers' judgment is advisable. The terms of the public offering of
the Offered Securities are or will be set forth in the Prospectus.
Payment for the Offered Securities shall be made by certified or
official bank check or checks payable to the Company or its order in
immediately available Federal funds (unless the Underwriting Agreement shall
otherwise specify) at the time and place set forth in the Underwriting
Agreement upon delivery to the Managers for the respective accounts of the
several Underwriters of the Offered Securities registered in such names and
in such denominations as the Managers shall request in writing not less than
two full business days prior to the date of delivery. The Company agrees to
have the Offered Securities available for inspection, checking and packaging
by the Managers at the location indicated in the Underwriting Agreement not
later than 1:00 P.M. on the business day next prior to the Closing Date.
The time and date of such payment and delivery with respect to the Offered
Securities are herein referred to as the "Closing Date".
3. Covenants of the Company.
The Company covenants and agrees with each of the Underwriters that:
(a) As soon as practicable after the acceptance of a proposal to
purchase the Offered Securities, the Company will file the Supplement with
the Commission pursuant to Rule 424(b) of the Securities Act. The Company
will not file at any time prior to the Closing Date any other amendment to
the Registration Statements or any supplement to the Prospectus, or any
other amended prospectus or any document that upon the filing thereof would
become an Incorporated Document of which Sidley & Austin ("Underwriters'
Counsel") shall not previously have been advised and furnished with a copy
or to which the Managers shall reasonably object in writing.
(b) The Company will advise the Managers immediately, and confirm such
advice promptly in writing, of the effectiveness of any amendment to either
of the Registration Statements.
(c) The Company will notify promptly each of the Underwriters in the
event of the issuance by the Commission of any stop order suspending the
effectiveness of either or both of the Registration Statements or in the
event of the institution or notice of intended institution by the Commission
of any action or proceeding for that purpose. In the event the Commission
shall enter a stop order suspending the effectiveness of either of the
Registration Statements, whether before or after the Offered Securities have
been delivered to the Managers or the Underwriters and paid for as provided
in the Underwriting Agreement, the Company will make every reasonable effort
to obtain, as promptly as possible, the entry by the Commission of an order
setting aside any such stop order or otherwise reinstating the effectiveness
of the Registration Statements.
(d) The Company will deliver to the Managers, on or before the Closing
Date, one signed copy of each of the registration statements as originally
filed and of each amendment thereto (in each case including all exhibits
thereto, other than exhibits incorporated by reference), and will also
deliver to the Managers, for distribution to the Underwriters, a sufficient
number of conformed copies of each of the foregoing (but without exhibits)
so that one copy of each may be distributed to each of the Underwriters.
The Company will also send to the Managers or to the Underwriters, without
expense to them, as soon as practicable after the date hereof, and
thereafter from time to time during a period of nine months after such date,
as many copies of any preliminary prospectus and the Prospectus as the
Managers may reasonably request for the purposes contemplated by the
Securities Act.
(e) The Company will use its best efforts, when and as requested by
the Managers, to furnish information and otherwise cooperate in qualifying
or registering the Offered Securities for offer and sale under the
securities or "blue sky" laws of such jurisdictions as the Managers may
designate, but the Company shall not thereby be obligated to qualify as a
foreign corporation in, or to execute or file any general consent to service
of process under the laws of, any jurisdiction. The Company will pay the
Underwriters' Counsel all reasonable fees (including counsel fees) and
expenses incurred by them in connection with such qualification or
registration of the Offered Securities for offer or sale, not exceeding,
however, $5,000 in the aggregate.
(f) If the Underwriting Agreement shall be terminated pursuant to the
provisions of Section 4 or 6(a), the Company will pay the reasonable fees
and disbursements of Underwriters' Counsel in connection with the
contemplated issue and sale of the Offered Securities, unless such
termination is caused by any default by the Managers or any of the
Underwriters in the performance of their respective obligations hereunder.
Except as provided in this subsection (f), the Underwriters shall pay the
fees of Underwriters' Counsel and reimburse such counsel for their
reasonable expenses paid or incurred in connection with the issue and sale
of the Offered Securities. The Company shall not in any event be liable to
any of the Underwriters for damages on account of loss of anticipated
profits.
(g) The Company will, so long as any of the Offered Securities shall
be outstanding, deliver to the Managers upon their request, and to each
other Underwriter who may so request, copies of all public reports and all
reports and financial statements furnished by the Company to the Commission
pursuant to the Exchange Act or any rule or regulation of the Commission
thereunder.
(h) During a period of nine months after the date of the Prospectus if
any event relating to or affecting the Company or its subsidiaries, if any,
or of which the Company shall be advised in writing by the Managers, shall
occur as a result of which it is necessary, in the opinion of counsel for
the Company, to supplement or amend the Prospectus in order to make the
Prospectus not misleading in the light of the circumstances existing at the
time it is delivered to a purchaser of Offered Securities from any of the
Underwriters, the Company will forthwith at its expense prepare and furnish
to the Managers or to the Underwriters a reasonable number of copies of a
supplement or supplements or an amendment or amendments to the Prospectus
(in form satisfactory to Underwriters' Counsel) which will supplement or
amend the Prospectus so that, as so supplemented or amended, it will not
include any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary in order to make
the statements therein, in the light of the circumstances existing at the
time the Prospectus is delivered to such a purchaser, not misleading. In
case any of the Underwriters is required to deliver a prospectus descriptive
of the Offered Securities after the expiration of nine months after the date
of the Prospectus, the Company, upon the request of the Managers, will
furnish to the Managers, at the expense of such Underwriter, a reasonable
quantity of amendments or supplements to the Prospectus complying with
Section 10 of the Securities Act. For the purpose of this subsection (h),
the Company will furnish such information with respect to itself and its
subsidiaries, if any, as the Managers may from time to time reasonably
request, and during said nine-month period, the Company will prepare and
continue to file with the Commission all documents required to be filed
under the Exchange Act.
(i) The Company will make generally available to its security holders,
as soon as practicable, an earnings statement (which need not be audited)
covering a period of at least twelve months beginning not earlier than the
date of the Prospectus, which earnings statement shall satisfy the
requirements of Section 11(a) of the Securities Act.
4. Conditions of Underwriters' Obligations.
The obligations of the Underwriters to purchase and pay for the Offered
Securities shall be subject to the performance by the Company of its
obligations to be performed under the Underwriting Agreement at or prior to
the Closing Date, to the continued accuracy in all material respects of the
representations and warranties of the Company contained in the Underwriting
Agreement, and to the following conditions:
(a) The Prospectus shall have been filed with the Commission pursuant
to Rule 424(b) within the applicable time period prescribed for such filing
and in accordance with Section 1(a) of this Agreement; no stop order
suspending the effectiveness of either of the Registration Statements shall
have been issued under the Securities Act, or proceedings therefor
instituted or threatened by the Commission, on or prior to the Closing Date.
(b) At or prior to the Closing Date the Underwriters shall have
received from Underwriters' Counsel an opinion (subject to the reservation
that they have relied upon the opinion of Wagstaff, Alvis, Stubbeman,
Xxxxxxxx & Xxxxxxxx, L.L.P., Abilene, Texas, counsel for the Company, as to
all matters governed by Texas law), to the effect that:
(i) the Company has been duly incorporated and is a validly
existing corporation under the laws of the State of Texas;
(ii) the Indenture has been duly and validly authorized by the
necessary corporate action by the Company, has been duly and validly
executed and delivered by the Company, and is a valid and binding
obligation of the Company enforceable against the Company in accordance
with its terms, subject, as to enforcement, (i) to the fact that
certain of the remedial provisions of the Indenture may be limited or
rendered unenforceable by the laws of the States wherein the mortgaged
property is situated (but said laws do not, in the opinion of such
counsel, make the remedies afforded by the Indenture inadequate for the
realization of the benefits of the security provided thereby), and (ii)
to bankruptcy, insolvency, reorganization, moratorium or other similar
laws relating to or affecting the enforcement of creditors' rights
generally; to the effects of the provisions of the Bankruptcy Reform
Act of 1978, as amended, on the validity of the lien of the Indenture
with respect to the property acquired or proceeds realized by the
Company after the commencement of bankruptcy proceedings with respect
to the Company; and to the effects of general principles of equity
(regardless of whether enforceability is considered in a proceeding in
equity or at law);
(iii) the issue and sale of the Offered Securities by the Company
in accordance with the terms of the Underwriting Agreement have been
duly and validly authorized by the Company. The Offered Securities,
when duly executed, authenticated and delivered to and paid for by the
Managers or the Underwriters, in accordance with the terms of the
Underwriting Agreement, will be valid and binding obligations of the
Company, secured by the lien of and entitled to the benefits of the
Indenture, subject, as to enforcement, (i) to the fact that certain of
the remedial provisions of the Indenture may be limited or rendered
unenforceable by the laws of the States wherein the mortgaged property
is situated (but said laws do not, in the opinion of such counsel, make
the remedies afforded by the Indenture inadequate for the realization
of the benefits of the security provided thereby), and (ii) to
bankruptcy, insolvency, reorganization, moratorium or other similar
laws relating to or affecting the enforcement of creditors' rights
generally; to the effects of the provisions of the Bankruptcy Reform
Act of 1978, as amended, on the validity of the lien of the Indenture
with respect to the property acquired or proceeds realized by the
Company after the commencement of bankruptcy proceedings with respect
to the Company; and to the effects of general principles of equity
(regardless of whether enforceability is considered in a proceeding in
equity or at law);
(iv) the Offered Securities and the Indenture conform as to legal
matters, in all material respects, with the statements concerning them
made in the Prospectus under the caption "Description of the New
Bonds," and in the Prospectus Supplement under the caption
"Supplemental Description of the New Bonds," and such statements
accurately set forth, in all material respects, the matters respecting
the Offered Securities and the Indenture which are required to be set
forth in the Prospectus, as supplemented by the Prospectus Supplement,
by the Securities Act and the Trust Indenture Act and the rules and
regulations under said Acts (other than the accounting provisions
thereof, with respect to the requirements of which such counsel need
express no opinion or belief); and the Indenture has been qualified
under the Trust Indenture Act;
(v) the supplemental order of the Commission referred to in
subsection (b) of Section 1 of the Underwriting Agreement has been duly
entered and, to the knowledge of said counsel, is in full force and
effect. Except for an order of the Commission entered into with
respect to each of the Registration Statements as contemplated in
paragraph (vi) below, no further approval, authorization, consent,
certificate or order of any Federal commission or regulatory authority
is necessary with respect to the execution and delivery of the
Indenture or the issue and sale of the Offered Securities by the
Company as contemplated in the Underwriting Agreement;
(vi) the Registration Statements on Form S-3 have become
effective under the Securities Act, and, to the knowledge of said
counsel, no stop order suspending the effectiveness of either of the
Registration Statements has been issued and no proceedings for such
purpose have been instituted or are pending or threatened under the
Securities Act;
(vii) the Registration Statements, the Prospectus and the
Prospectus Supplement, in each case excluding the Incorporated
Documents (other than financial statements, financial data, statistical
data and supporting schedules included or incorporated by reference
therein, as to which said counsel need express no opinion or belief),
as of their respective effective or issue dates, complied as to form,
in all material respects, with the requirements of the Securities Act
(or, where appropriate, the Exchange Act) and the rules and regulations
of the Commission thereunder; and
(viii) the Underwriting Agreement has been duly authorized,
executed and delivered by the Company.
Such counsel shall also state that while, except as otherwise
required or stated in said opinion, said counsel have not independently
checked the accuracy or completeness of, or otherwise verified, and
accordingly, are not passing upon, and do not assume any responsibility
for and have not independently verified the accuracy, completeness or
fairness of the statements contained in the Registration Statements,
the Prospectus or the Prospectus Supplement, and relying as to
materiality, to a large extent, upon the judgment of officers and
representatives of the Company, nothing has come to the attention of
said counsel which would lead said counsel to believe that the
Registration Statements relating to the Offered Securities or any
amendment thereto (other than financial statements, financial data,
statistical data and supporting schedules included or incorporated by
reference therein, as to which said counsel need express no opinion or
belief), at the respective times they became effective, contained any
untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading or that (with the foregoing exception) the
Prospectus, as supplemented by the Prospectus Supplement, as of the
date of such opinion includes any untrue statement of a material fact
or omits to state a material fact required to be stated therein or
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
(c) At or prior to the Closing Date, the Underwriters shall have
received from Milbank, Tweed, Xxxxxx & XxXxxx, counsel for the Company, an
opinion (subject to the same reservation as that expressed in subsection (b)
of this Section 4), in form and substance satisfactory to Underwriters'
Counsel, to the same effect, in general, with respect to all matters
enumerated in subsection (b) of this Section 4.
(d) At or prior to the Closing Date, the Underwriters shall have
received from Wagstaff, Alvis, Stubbeman, Xxxxxxxx & Xxxxxxxx, L.L.P.,
Abilene, Texas, counsel for the Company, an opinion, in form and substance
satisfactory to Underwriters' Counsel, to the effect that:
(i) the Company has been duly incorporated and is a validly
existing corporation under the laws of the State of Texas;
(ii) the issue and sale of the Offered Securities by the Company
in accordance with the terms of the Underwriting Agreement have been
duly and validly authorized by the necessary corporate action; the
Offered Securities, when duly executed, authenticated and delivered to
the Underwriters against payment to the Company of the agreed
consideration therefor, will be valid and binding obligations of the
Company, secured by the lien of and entitled to the benefits of the
Indenture;
(iii) the Company is a public utility duly authorized by its
Restated Articles of Incorporation, as amended, to conduct the business
of generating and supplying electric light and power to the public and
conducts such business only in the State of Texas and the Company has
the legal right to function and operate as a public utility in the
State of Texas, supplying therein electric service;
(iv) the Company has good and sufficient title to all or
substantially all the permanent fixed electric utility properties now
owned by it, including those described or referred to in the Prospectus
and the Prospectus Supplement, except as otherwise indicated therein,
subject only to the lien of the Indenture and to permitted encumbrances
and liens and prepaid liens (as defined in the Indenture); the
Indenture, subject only to permitted encumbrances and liens and prepaid
liens, constitutes a valid, direct first mortgage lien upon all such
fixed properties of the Company (with the exception of the properties
expressly excepted or excluded from such lien); all permanent fixed
property hereafter acquired by the Company and situated in the State of
Texas (other than property of the character of that expressly excepted
or excluded from the lien of the Indenture), will, upon such
acquisition, become subject to the lien of the Indenture, subject,
however, to such permitted encumbrances and liens and prepaid liens,
any liens existing or placed on such property at the time of the
acquisition thereof by the Company, and any liens thereon which might
intervene prior to the filing for record of the instrument by which
title to such property is acquired by the Company and except as
provisions of the Bankruptcy Code may affect the validity of the lien
of the Indenture with respect to property acquired, and proceeds,
products, rents, issue or profits of the property subject to such lien
realized, after commencement of a case under such Code; and the
Indenture has been duly and validly authorized by the necessary
corporate action by the Company, has been duly and validly executed and
delivered by the Company and is a valid and binding obligation of the
Company enforceable against the Company in accordance with its terms,
except as set forth in the preceding clause, and subject as to
enforcement to bankruptcy, insolvency, reorganization, moratorium or
other similar laws relating to or affecting the enforcement of
creditors rights generally and to the effects of general principles of
equity (regardless of whether enforceability is considered in a
proceeding in equity or at law) and except as enforcement of provisions
thereof may be limited by the laws of the State of Texas affecting the
remedies for the enforcement of the security provided for in the
Indenture (which state laws do not, in the opinion of such counsel,
make such remedies inadequate for the realization of the benefits of
such security);
(v) the Indenture has been duly recorded as a utility security
instrument in the office of the Secretary of the State of Texas and
notices of utility security instrument affecting real property have
heretofore been duly filed in each of the counties in the State of
Texas in which property owned by the Company and subject to the lien of
the Indenture is situated, in such manner as to make effective the lien
intended to be created by the Indenture; and such recordation and
filings constitute all of the action required under the laws of the
State of Texas to give notice of the lien of the Indenture;
(vi) the Company has valid and subsisting franchises, licenses
and permits authorizing it to carry on its electric utility business in
all municipalities served by it where required, with such minor
exceptions (if any) as may be indicated in such opinion;
(vii) no approval, authorization, consent, certificate or order
of any commission or regulatory authority of the State of Texas (other
than in connection or in compliance with the securities or "blue sky"
laws or regulations of the State of Texas) is necessary with respect to
the execution and delivery of the Indenture or the issuance and sale of
the Offered Securities by the Company to the Underwriters as
contemplated by the Underwriting Agreement;
(viii) except as set forth in the Prospectus or the Prospectus
Supplement, there is no material litigation or other legal proceeding
pending to which the Company is a party or of which property of the
Company is the subject, and, to the best of the knowledge of said
counsel, no such litigation or proceedings are contemplated; there may
be excepted various routine litigation, claims and other proceedings,
which are common or incident to the business in which the Company is
engaged but which, in the aggregate, are not significant (in the
opinion of said counsel) from the standpoint of the total assets and
overall operations of the Company;
(ix) the sale by the Company of the Offered Securities has been
duly authorized by the necessary corporate action; the Underwriting
Agreement has been duly authorized, executed and delivered by the
Company; and
(x) the statements made in the Prospectus and the Prospectus
Supplement, if any, which are stated therein to have been made on the
authority of such counsel have been reviewed by such counsel and, as to
matters of law or legal conclusions, are correct.
(e) At or prior to the Closing Date, the Underwriters shall have
received from Xxxxxx Xxxxxxxx LLP a letter confirming that they are
independent public accountants with respect to the Company within the
meaning of the Securities Act and the applicable published rules and
regulations thereunder and that the answer to Item 10 of the Registration
Statements is correct insofar as it relates to them and stating in effect
(1) that in their opinion the financial statements and schedules of the
Company incorporated by reference in the Registration Statements and
Prospectus and which are stated therein to have been certified or audited by
them, comply as to form, in all material respects, with the applicable
accounting requirements of the Securities Act and the published rules and
regulations thereunder; (2) that nothing has come to their attention which
causes them to believe (A) that any unaudited dollar amounts or ratios which
may appear in the Registration Statements and the Prospectus under the
caption "The Company" were not determined on a basis substantially
consistent with that of the corresponding amounts in the audited financial
statements incorporated by reference in the Registration Statements and the
Prospectus; (B) that any unaudited condensed financial statements of the
Company included in any of the Company's Form 10-Q Quarterly Reports, which
may be incorporated by reference in the Registration Statements and the
Prospectus, do not comply as to form in all material respects with the
applicable accounting requirements of the Exchange Act and the applicable
published rules and regulations thereunder, or that material modifications
should be made to such unaudited financial statements for them to be in
conformity with generally accepted accounting principles; or (C) that,
except in all instances as set forth or contemplated in the Registration
Statements or the Prospectus, (i) at the date of the latest available
unaudited financial statements of the Company read by them and at a
subsequent date, not more than five business days before the Closing Date,
there has been any change in the capital stock or long-term debt of the
Company, as compared with amounts shown in the latest balance sheet of the
Company included or incorporated by reference in the Registration Statements
and the Prospectus, except for normally scheduled reductions in the
Company's long-term debt, (ii) for the period from the date of the latest
financial statements included or incorporated by reference in the Prospectus
to the date of the latest available interim financial statements read by
them and to the aforementioned date not more than five business days prior
to the Closing Date there was any decrease, as compared with the
corresponding period in the preceding twelve month period, in the Company's
operating revenues, operating income or net income, (iii) there was any
decrease in the ratio of earnings to fixed charges for the twelve months
ended the date of such latest available interim financial statements as
compared to such ratio for the twelve months ended the date of the latest
financial statements included or incorporated by reference in the
Prospectus, except as set forth in such letter, in which latter case the
letter shall be accompanied by an explanation by the Company as to the
significance thereof unless such explanation is not deemed necessary by the
Managers; and (3) that they have compared certain dollar amounts designated
by the Company and disclosed in the Registration Statements and Prospectus
with such dollar amounts contained in the general accounting records of the
Company or derived directly from such records by analysis or computation,
and have found such dollar amounts to be in agreement therewith, except as
otherwise specified in such letter, in which latter case the letter shall be
accompanied by an explanation by the Company as to the significance thereof
unless such explanation is not deemed necessary by the Managers.
The form of letter shall reflect the inclusion of any subsequently
dated financial information, the incorporation by reference of any
subsequently filed Annual Report on Form 10-K or Quarterly Report on Form
10-Q and/or the inclusion in the Prospectus of any statistical or financial
information.
Subsequent to the respective dates as of which information is given in
the Registration Statements and the Prospectus, there shall not have been
any change or decrease specified in the letter required by this subsection
(e) which is, in the judgment of the Managers, so material and adverse as to
make it impractical or inadvisable to proceed with the offering or the
delivery of the Offered Securities as contemplated by the Registration
Statements and the Prospectus.
(f) At the Closing Date the Managers shall have received a
certificate, dated as of the Closing Date, signed by the President or a Vice
President and the Treasurer or the Secretary of the Company, to the effect
that (i) to the best of the knowledge of the signers, no stop order
suspending the effectiveness of either of the Registration Statements has
been issued under the Securities Act and no proceedings therefor have been
instituted or threatened by the Commission, (ii) the order of the Commission
referred to in subsection (b) of Section 1 of the Underwriting Agreement is,
to the best of the knowledge of the signers, in full force and effect, and
(iii) since the respective dates as of which information is given in the
Registration Statements or Prospectus, there has been no (A) material
adverse change in the condition, financial or otherwise, or in the earnings
of the Company or (B) adverse development concerning the Company's business
or assets which would result in a material adverse change in its prospective
financial condition or results of operations, except such changes as are set
forth or contemplated in the Registration Statements or the Prospectus
(including financial statements and notes thereto contained in the
Incorporated Documents).
(g) All proceedings to be taken in connection with the issuance and
sale of the Offered Securities by the Company as contemplated in the
Underwriting Agreement shall be satisfactory in form and substance to
Underwriters' Counsel.
In case any of the conditions specified in this Section 4 shall not
have been fulfilled, the Underwriting Agreement may be terminated by the
Managers with the consent of Underwriters who have agreed to purchase in the
aggregate more than fifty percent of the total principal amount of the
Offered Securities upon delivering written notice thereof to the Company.
Any such termination shall be without liability of any party to any other
party except as otherwise provided in subsection (f) of Section 3 of the
Underwriting Agreement.
5. Indemnification
(a) The Company agrees to indemnify and hold harmless each of the
Underwriters and each person, if any, who controls any of the Underwriters
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 the
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 defending against any such losses, claims, damages
or liabilities, arising out of or based upon any untrue statement or alleged
untrue statement of a material fact contained in (1) the Registration
Statements, the Basic Prospectus, any preliminary prospectus, or the
Prospectus or any amendment to the Registration Statements or amendment or
supplement to the Prospectus, 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, or (2) the Prospectus or the
Prospectus as amended or supplemented, if such losses, claims, damages or
liabilities arise out of or are based upon the use of the Prospectus or the
Prospectus as amended or supplemented after the Company shall have amended
or supplemented the Prospectus, or any omission or alleged omission to state
therein a material fact necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not
misleading; provided, however, that the indemnity agreement contained in
this subsection (a) shall not apply to any such losses, claims, damages or
liabilities arising out of or based upon (i) 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 Company by any of the Underwriters
for use in the Registration Statements or the Prospectus or any amendment or
supplement to either thereof, (ii) any statement made in any Form T-1 or
Form T-2 filed by the Trustees as exhibits to the Registration Statements or
(iii) the failure of any Underwriter to deliver (either directly or through
the Managers) a copy of the Prospectus (excluding the Incorporated
Documents), or of the Prospectus as amended or supplemented after it shall
have been amended or supplemented by the Company (excluding the Incorporated
Documents), to any person to whom a copy of any preliminary prospectus shall
have been delivered by or on behalf of such Underwriter to whom any Offered
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 agrees to indemnify and hold harmless the
Company, each of its officers who signs the Registration Statements, each of
its directors, each person who controls the Company within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act, each
other Underwriter and each person, if any, who so controls any such other
Underwriter, 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 Statements or the Prospectus or
any amendment to the Registration Statements 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 Company by such Underwriter for use in the Registration Statements or
the Prospectus or any amendment or supplement to either thereof, or (ii) the
failure of such Underwriter to deliver (either directly or through the
Managers) a copy of the Prospectus (excluding the Incorporated Documents),
or of the Prospectus as amended or supplemented after it shall have been
amended or supplemented by the Company (excluding the Incorporated
Documents), 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
Offered 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.
(c) Promptly after receipt by a party indemnified under this Section
5 (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 5 (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 5. 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 hereunder), with counsel satisfactory to such indemnified
party; provided, however, that if the defendants in any such action include
both the indemnified party and the indemnifying party and the indemnified
party shall have reasonably concluded that there may be legal defenses
available to it and/or other indemnified parties which are different from or
additional to those available to the indemnifying party, the indemnified
party or parties shall have the right to select separate counsel to assert
and conduct such legal defenses and to otherwise participate in the defense
of such action on behalf of such indemnified party or parties. 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 5 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 connection with the assertion of legal defenses 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, approved by the Managers in the
case of subsection (a), representing the indemnified parties under
subsection (a) who are parties to such action), (ii) the indemnifying party
shall not have employed counsel satisfactory to the indemnified party to
represent the indemnified party within a reasonable time after notice of
commencement of the action or (iii) the indemnifying party has authorized
the employment of counsel for the indemnified party at the expense of the
indemnifying party; and except that, if clause (i) or (iii) is applicable,
such liability shall be only in respect of the counsel referred to in such
clause (i) or (iii).
(d) If the indemnification provided for in this Section 5 shall be
unenforceable under applicable law by an indemnified party, the Company
agrees 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 5 shall be unenforceable, in such proportion as
shall be appropriate to reflect the relative fault of the Company on the one
hand and the indemnified party on the other 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 Company if the Company 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
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 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 indemnity and contribution agreements contained in this
Section 5 and the representations and warranties of the Company in the
Underwriting Agreement shall remain operative and in full force regardless
of (i) any termination of the Underwriting 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 Company, its directors or officers or
any person controlling the Company and (iii) delivery of and payment for any
of the Offered Securities.
6. Termination.
(a) If the Offered Securities are being purchased for the purpose of
resale, the Underwriting Agreement may be terminated, at any time prior to
the Closing Date, by the Managers with the consent of Underwriters who have
agreed to purchase in the aggregate more than fifty percent of the total
principal amount of the Offered Securities, if (a) there shall have occurred
any general suspension or material limitation on trading in securities on
the New York Stock Exchange or by the Commission or by any federal or state
agency or by the decision of any court any limitation on prices for such
trading or any restrictions on the distribution of securities, (b) trading
in any securities of the Company shall have been suspended by the Commission
or a national securities exchange, (c) a general banking moratorium on
commercial banking activities in New York shall have been declared either by
federal or New York State authorities, (d) the rating assigned by any
nationally recognized securities rating agency to any securities of the
Company as of the date of the Underwriting Agreement shall have been lowered
since that date or (e) there shall have occurred any outbreak or material
escalation of hostilities or other calamity or crisis, the effect of which
on the financial markets of the United States is such as to make it, in the
judgment of the Managers, impracticable to market the Offered Securities.
(b) Any termination of the Underwriting Agreement pursuant to this
Section 6 shall be without liability of any party to any other party except
as otherwise provided in subsection (f) of Section 3.
7. Default by an Underwriter.
If any one or more Underwriters shall fail to purchase and pay for any
of the Offered Securities agreed to be purchased by such Underwriter or
Underwriters hereunder and such failure to purchase shall constitute a
default in the performance of its or their obligations under the
Underwriting Agreement, the remaining Underwriters shall be obligated
severally to take up and pay for (in the respective proportions which the
amount of Offered Securities set forth opposite their names in Schedule I to
the Underwriting Agreement bears to the aggregate amount of Offered
Securities set forth opposite the names of all the remaining Underwriters)
the Offered Securities which the defaulting Underwriter or Underwriters
agreed but failed to purchase; provided, however, that in the event that the
aggregate amount of Offered Securities which the defaulting Underwriter or
Underwriters agreed but failed to purchase (less such aggregate amount of
Offered Securities as are purchased by substituted underwriters selected by
the Managers with the approval of the Company or selected by the Company
with the approval of the Managers) shall exceed 10% of the aggregate amount
of Offered Securities set forth in such Schedule I, the remaining
Underwriters shall have the right to purchase all, but shall not be under
any obligation to purchase any, of the Offered Securities, and if such
nondefaulting Underwriters do not purchase all the Offered Securities, the
Underwriting Agreement will terminate without liability to any nondefaulting
Underwriter or the Company (except as otherwise provided in subsection (f)
of Section 3). In the event of a default by an Underwriter as set forth in
this Section 7, the Closing Date shall be postponed for such period, not
exceeding seven calendar days, as the Company and the Managers shall
determine in order that the required changes in the Registration Statements
and the Prospectus or in any other documents or arrangements may be
effected. Nothing contained in the Underwriting Agreement shall relieve any
defaulting Underwriter of its liability, if any, to the Company and any
nondefaulting Underwriter for damages occasioned by its default thereunder.
8. Notices.
All communications under the Underwriting Agreement will be effective
only on receipt, and, if sent to the Managers, will be mailed, delivered or
telegraphed and confirmed to them, at the address, or telephoned to them at
the number, specified in the Underwriting Agreement and to Sidley & Austin,
Xxx Xxxxx Xxxxxxxx Xxxxx, Xxxxxxx, Xxxxxxxx 00000, attention: Xxxxxx X.
Xxxx, Xx.; or, if sent to the Company, will be mailed, delivered or
telegraphed
and confirmed to it in care of Central and South West Corporation, 1616
Xxxxxxx Xxxxxxx Freeway, X.X. Xxx 000000, Xxxxxx, Xxxxx 00000, attention of
Xxxxxxx X. Xxxx, in each case with written confirmation of such
communication sent to Milbank, Tweed, Xxxxxx & XxXxxx, 0 Xxxxx Xxxxxxxxx
Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, attention Xxxxxx X. Xxxxxxxx, Esq.
9. Successors.
The Underwriting Agreement will inure to the benefit of and be binding
upon the parties hereto and their respective successors and the officers and
directors and controlling persons referred to in Section 5 of the
Underwriting Agreement, and no other person will have any right or
obligation hereunder and no other person (including a purchaser, as a
purchaser, from any Underwriter of any of the Offered Securities) shall
acquire or have any rights under or by virtue of the Underwriting Agreement.
10. Governing Law.
The Underwriting Agreement shall be governed by and construed in
accordance with the laws of the State of New York.
