EXHIBIT 1
THE UNION LIGHT, HEAT AND POWER COMPANY
UNDERWRITING AGREEMENT
DATED: _______________, [2004]
[Name of Managing Underwriter]
[Address]
Dear Sirs:
The Union Light, Heat and Power Company, an Kentucky corporation
(hereinafter called the "Company"), proposes to issue and sell [$75,000,000
principal amount of ______% Debentures due ______ (hereinafter called the
"Securities")], to be issued pursuant to the provisions of [the Indenture dated
as of , 2004 (hereinafter called the "Indenture"), between the
Company and Deutsche Bank Trust Company Americas, Trustee (hereinafter called
the "Trustee"), as supplemented by the _________ Supplemental Indenture dated as
of ________, between the Company and the Trustee (hereinafter called the
"Supplemental Indenture")].
The Company has filed with the Securities and Exchange Commission
(hereinafter called the "Commission") a registration statement (File No.
333-________) including a prospectus relating to the [Securities], and has filed
with the Commission (or will promptly after the sale so file) a prospectus
supplement specifically relating to the [Securities] pursuant to Rule 424 under
the Securities Act of 1933. The term Registration Statement means the
registration statement as amended to the date of this Agreement. The term Base
Prospectus means the prospectus included in the Registration Statement. The term
Prospectus means the Base Prospectus together with the prospectus supplement
specifically relating to the [Securities], as filed with the Commission pursuant
to Rule 424. The term preliminary prospectus means a preliminary prospectus
supplement specifically relating to the [Securities] together with the Base
Prospectus. As used herein, the terms "Registration Statement", "Base
Prospectus", "Prospectus" and "preliminary prospectus" shall include in each
case the material, if any, incorporated by reference therein.
I.
The Company hereby agrees to sell to each of the undersigned Underwriters,
and the Underwriters, upon the basis of the representations and warranties
herein contained, but subject to the conditions hereinafter stated, agree to
purchase from the Company, each severally and not jointly, the principal amount
of Securities set forth opposite their names at a price of ____% of their
principal amount - the purchase price - and accrued interest from ________, to
the date of payment and delivery:
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Name [Principal Amount]
---- ------------------
[Name of Managing Underwriter] [$]_______________
[Other Underwriters] [$]_______________
Total [$]_______________
II.
The Company is advised by you that the Underwriters propose to make a
public offering of their respective portions of the Securities as soon after the
execution of this Agreement as in your judgment is advisable. The Company is
further advised by you that the Securities are to be offered to the public at
_____% of their principal amount - the public offering price - and accrued
interest, and to certain dealers at a price which represents a concession of
_____% of their principal amount under the public offering price, and that any
Underwriter may allow, and such dealers may reallow, a concession, not in excess
of _____% of their principal amount, to certain other dealers.
III.
Payment for the Securities shall be made by transfer of immediately
available funds to an account identified by us in writing not less than two full
business days prior to the date of payment, against delivery to you for the
respective accounts of the several Underwriters of the Securities through The
Depositary Trust Company at 10:00 A.M.,
New York Time, on ______________, [2004]
or at such other time on the same or such other date, not later than
_____________, [2004], as may be designated by you. The time and date of such
payment and delivery are herein referred to as the Closing Date. All other
documents referred to herein that are to be delivered at the closing date shall
be delivered at that time at the office of Xxxxx Xxxx & Xxxxxxxx, 000 Xxxxxxxxx
Xxxxxx, Xxx Xxxx, XX 00000.
IV.
The obligations of the Company and the several obligations of the
Underwriters hereunder are subject to the conditions that:
(a) The Registration Statement shall have become effective under the
Securities Act of 1933.
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(b) No stop order suspending the effectiveness of the Registration
Statement shall be in effect and no proceedings for such purpose shall
be pending before, or threatened by, the Commission.
(c) An appropriate order or orders of the Indiana Utility Regulatory
Commission necessary to permit the issue and sale of the Securities as
contemplated hereby and containing no material provision or condition
which is unacceptable to the Company or the Underwriters shall be in
effect and no proceedings to suspend the effectiveness of such order or
orders shall be pending or threatened.
The several obligations of the Underwriters hereunder are subject to the
following further conditions:
(d) There shall have been no material adverse change (not in the ordinary
course of business) in the condition of the Company and its
subsidiaries, taken as a whole, from that set forth in or contemplated
by the Registration Statement and the Prospectus; and you shall have
received on the Closing Date a certificate, dated the Closing Date and
signed by an executive officer of the Company, to the foregoing effect.
(e) Subsequent to the execution and delivery of this Agreement and prior to
the Closing Date, there shall not have occurred any downgrading of, nor
shall any notice have been given of any review with a negative
implication with respect to, the rating accorded any of the Company's
securities by any of Standard & Poor's Ratings Services, Xxxxx'x
Investors Service or Fitch Ratings (or any of their successors).
(f) You shall have received on the Closing Date a certificate, dated the
Closing Date and signed by an executive officer of the Company, to the
effect set forth in (b) and (c) of the first paragraph of this Article
IV (provided that such certificate may omit any reference as to the
extent to which provisions or conditions in the orders referred to in
(c) above are acceptable to the Underwriters). The officer making such
certificate may rely upon the best of his knowledge as to proceedings
pending or threatened.
(g) You shall have received on the Closing Date the favorable opinion of
Xxxxxxxx Xxxx LLP, counsel for the Company, dated the Closing Date, to
the effect that:
(i) the Company is a corporation duly incorporated and existing
in good standing under the laws of the State of Indiana and,
except for certain operating permits for which the Company
has made application but which have either been denied or
have not yet been granted in the form requested, and except
for certain notices of violations, the Company has due
corporate and governmental authority to carry on the public
utility businesses in which it is engaged and to own and
operate the properties in use in such businesses;
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(ii) the Company is duly qualified to transact business and is in
good standing in the jurisdictions in which the conduct of
its businesses or the ownership or leasing of its properties
requires such qualification;
(iii) [each of the Indenture and the Supplemental Indenture has
been duly authorized, executed and delivered by the Company
and is valid and binding instrument enforceable in
accordance with its terms, except as (A) the enforceability
thereof may be limited by bankruptcy, insolvency or similar
laws affecting the enforcement of creditors' rights
generally and (B) rights of acceleration and the
availability of equitable remedies may be limited by
equitable principles of general applicability; and the
Indenture has been duly qualified under the Trust Indenture
Act of 1939;]
(iv) [the Securities, when duly executed by the Company,
authenticated by the Trustee and delivered to and paid for
by the Underwriters pursuant to this Agreement, will be
valid and binding obligations of the Company in accordance
with their terms, except as (A) the enforceability thereof
may be limited by bankruptcy, insolvency or similar laws
affecting the enforcement of creditors' rights generally and
(B) rights of acceleration and the availability of equitable
remedies may be limited by equitable principles of general
applicability];
(v) such counsel does not know of any contract required to be
filed as an exhibit to the Registration Statement, or
incorporated therein by reference, which has not been so
filed or incorporated by reference;
(vi) the statements made in the Prospectus under the captions
["Description of the Unsecured Debt Securities,"] and
["Certain Terms of the Securities,"] in each case insofar as
such statements constitute summaries of the legal matters
referred to therein, fairly summarize the matters referred
to therein; and the provisions of the [Indenture,][the
Supplemental Indenture,] and the [Securities] conform as to
legal matters to the description thereof and to the
statements in regard thereto contained in the Registration
Statement and the Prospectus;
(vii) this Agreement has been duly authorized, executed and
delivered by the Company;
(viii) such counsel (A) is of the opinion that each document
incorporated by reference in the Prospectus (except for the
financial statements and schedules and other financial and
statistical data therein as to which such counsel need not
express an opinion) complied when filed with the Commission
as to form in all material respects with the requirements of
the Securities Exchange Act of 1934, together with the
applicable rules and regulations of the Commission
thereunder, (B) is of the opinion that the Registration
Statement and the Prospectus and any supplements or
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amendments thereto (except for the financial statements and
schedules and other financial and statistical data therein
as to which such counsel need not express an opinion) comply
as to form in all material respects with the requirements of
the Securities Act of 1933 and the rules and regulations of
the Commission thereunder and (C) except for the financial
statements and schedules and other financial and statistical
data therein as to which such counsel need not express a
belief, has no reason to believe that the Registration
Statement and the Prospectus at the date of this Agreement
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 or
that the Prospectus (as amended or supplemented if
applicable) on the Closing Date contained an untrue
statement of a material fact or omitted to state a material
fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made,
not misleading.
In regard to clause (ix) above, such counsel may state that no opinion is
expressed with respect to the effect of
New York law. In regard to clause (x)
above, such counsel may state that their opinion and belief is based upon their
participation in the preparation of the Registration Statement and the
Prospectus and any supplements and amendments thereto and upon their review and
discussion of the contents thereof, but is without independent check or
verification except as specified.
(h) You shall have received on the Closing Date an opinion of Xxxxx Xxxx &
Xxxxxxxx, counsel for the Underwriters, dated the Closing Date,
covering the matters in (iv), (v), and clauses (B) and(C) of (x) of (g)
above, provided that with respect to clauses (B) and (C) of (x) of (g)
above, such counsel may state that their opinion and belief is based
upon their participation in the preparation of the Registration
Statement and the Prospectus and any amendments and supplements thereto
(other than documents incorporated by reference), and upon their review
and discussion of the contents thereof (including documents
incorporated by reference), but is without independent check or
verification except as specified.
(i) [You shall have received on the Closing Date a letter, dated the
Closing Date, in form and substance satisfactory to you, from Deloitte
& Touche LLP, independent accountants, containing statements and
information of the type ordinarily included in accountants' "comfort
letters" to underwriters with respect to the financial statements and
certain financial information contained in or incorporated by reference
into the Registration Statement and the Prospectus.]
V.
In further consideration of the agreements of the Underwriters herein
contained the Company covenants as follows:
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(a) To furnish without charge to you two signed copies of the Registration
Statement (including exhibits and documents incorporated by reference),
and to each other Underwriter a copy of the Registration Statement
(without exhibits but including documents incorporated by reference)
and, during the period mentioned in paragraph (c) below, as many copies
of the Prospectus and any amendments and supplements thereto as you may
reasonably request. The terms "supplement" and "amendment" or "amend"
as used in this Agreement shall include or refer to all documents
subsequently filed by the Company with the Commission pursuant to the
Securities Exchange Act of 1934 which are deemed to be incorporated by
reference in the Prospectus from the date of filing such documents in
accordance with Form S-3.
(b) Before amending or supplementing the Registration Statement or the
Prospectus, to furnish to each of you a copy of each such proposed
amendment or supplement.
(c) If, during such period after the first date of the public offering of
the [Securities] as in the opinion of your counsel a prospectus
covering the [Securities] is required by law to be delivered in
connection with sales by an Underwriter or dealer, any event shall
occur as a result of which it is necessary to amend or supplement the
Prospectus in order to make the statements therein, in the light of the
circumstances when the Prospectus is delivered to a purchaser, not
misleading, or if it shall be necessary to amend or supplement the
Prospectus to comply with law, forthwith to prepare and furnish, at its
own expense, to the Underwriters and to the dealers (whose names and
addresses you will furnish to the Company) to which [Securities] may
have been sold by you on behalf of the Underwriters and to any other
dealers upon request, either amendments or supplements to the
Prospectus so that the statements in the Prospectus as so amended or
supplemented will not, in the light of the circumstances when the
Prospectus is delivered to a purchaser, be misleading or so that the
Prospectus will comply with law.
(d) To endeavor to qualify the [Securities] for offer and sale under the
securities or Blue Sky laws of such jurisdictions as you shall
reasonably request and to pay all expenses (including fees and
disbursements of counsel) in connection with such qualification and in
connection with the determination of the eligibility of the
[Securities] for investment under the laws of such jurisdictions as you
may designate.
(e) To make generally available to the Company's security holders as soon
as practicable an earnings statement covering the twelve-month period
beginning after the date of this Agreement, which shall satisfy the
provisions of Section 11(a) of the Securities Act of 1933 (including
Rule 158 thereunder).
(f) During the period beginning on the date of this Agreement and
terminating on the Closing Date not to offer, sell, contract to sell or
otherwise dispose of any debt securities of the Company substantially
similar to the [Securities], without your prior written consent.
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VI.
The Company represents and warrants to each Underwriter that (i) each
prospectus and prospectus supplement filed as part of the registration statement
as originally filed or as part of any amendment thereto or filed pursuant to
Rule 424 under the Securities Act of 1933, complied when so filed in all
material respects with the requirements of the Securities Act of 1933 and the
applicable rules and regulations thereunder, (ii) each document incorporated by
reference in the Prospectus complied when filed (and each document subsequently
filed by the Company pursuant to the Securities Exchange Act of 1934 and deemed
incorporated by reference into the Prospectus will, at the time of filing,
comply) in all material respects with the provisions of the Securities Exchange
Act of 1934, together with the applicable rules and regulations of the
Commission thereunder, and (iii) the Registration Statement and Prospectus, as
amended or supplemented, will comply in all material respects with the
Securities Act of 1933 and the applicable rules and regulations thereunder and
will not contain any 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; except that these representations and warranties do not
apply to statements or omissions in the Registration Statement or the
Prospectus, or any preliminary prospectus based upon information furnished to
the Company in writing by any Underwriter expressly for use therein.
The Company agrees to indemnify and hold harmless each Underwriter and each
person, if any, who controls any Underwriter within the meaning of Section 15 of
the Securities Act of 1933 or Section 20 of the Securities Exchange Act of 1934,
from and against any and all losses, claims, damages and liabilities (including
the fees and expenses of counsel in connection with any governmental or
regulatory investigation or proceeding) caused by any untrue statement or
alleged untrue statement of a material fact contained in the Registration
Statement or Prospectus (if used within the period set forth in paragraph (c) of
Article V hereof and as amended or supplemented if the Company shall have
furnished any amendments or supplements thereto) or any preliminary prospectus,
or caused by 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, except insofar as such losses, claims, damages or liabilities are
caused by any such untrue statement or omission or alleged untrue statement or
omission based upon information furnished in writing to the Company by any
Underwriter expressly for use therein.
In case any action shall be brought against any Underwriter or any person
controlling such Underwriter, based upon the Registration Statement or
Prospectus or any amendment or supplement thereto or any preliminary prospectus
and in respect of which indemnity may be sought against the Company, such
Underwriter shall promptly notify the Company in writing, and the Company, upon
the request of such Underwriter, shall assume the defense thereof on behalf of
such Underwriter or controlling person, including the employment of counsel and
payment of all expenses. In any such action, any Underwriter or any such
controlling person shall have the right to employ its own counsel but the fees
and expenses of such counsel shall be at the expense of such Underwriter or such
controlling person unless (i) the employment of such counsel has been
specifically authorized in writing by the Company or (ii) the named parties to
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any such action (including any impleaded parties) include both such Underwriter
or such controlling person and the Company and such Underwriter or such
controlling person shall have been advised by such counsel that there maybe one
or more legal defenses available to it which are different from or additional to
those available to the Company (it being understood, however, that the Company
shall not, in connection with any one such action or separate but substantially
similar or related actions in the same jurisdiction arising out of the same
general allegations or circumstances, be liable for the reasonable fees and
expenses of more than one separate firm of attorneys (in addition to one firm of
local counsel) for all such Underwriters and controlling persons, which firm
shall be designated in writing by you, and that such fees and expenses shall be
reimbursed as they are incurred). The Company shall not be liable for
indemnification (or contribution as provided below) with respect to the
settlement of any such action effected without its written consent, but if
settled with the written consent of the Company or if there be a final judgment
for the plaintiff in any such action, the Company agrees to indemnify and hold
harmless any Underwriter and any such controlling person from and against any
loss or liability by reason of such settlement or judgment (or to make
contribution as provided below).
Each Underwriter agrees, severally and not jointly, to indemnify and hold
harmless the Company, its directors, its officers who sign the Registration
Statement and any person controlling the Company to the same extent as the
foregoing indemnity from the Company to each Underwriter, but only with
reference to information relating to such Underwriter furnished in writing by
such Underwriter expressly for use in the Registration Statement, the Prospectus
or any preliminary prospectus. In case any action shall be brought against the
Company, any of its directors or any such officer or controlling person based on
the Registration Statement, the Prospectus or any preliminary prospectus and in
respect of which indemnity may be sought against any Underwriter, the
Underwriter shall have the rights and duties given to the Company, and the
Company, its directors or any such officer or controlling person shall have the
rights and duties given to the Underwriter, by the preceding paragraph of this
Article VI.
If the indemnification provided for in the second paragraph of this Article
VI is unavailable to any Underwriter or other indemnified party in respect of
any losses, claims, damages or liabilities referred to therein, then the
Company, in lieu of indemnifying such indemnified party thereunder, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company on the one
hand and such Underwriter on the other from the offering of the
[Securities][Shares] or(ii) if the allocation provided by clause (i) above is
not permitted by applicable law, in such proportion as is appropriate to reflect
not only the relative benefits referred to in clause (i) above but also the
relative fault of the Company on the one hand and of such Underwriter on the
other in connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one hand
and the Underwriters on the other shall be deemed to be in the same proportion
as the total net proceeds from the offering (before deducting expenses) received
by the Company bear to the total underwriting discounts and commissions received
by the Underwriters, in each case as set forth in the table on the cover page of
the Prospectus. The relative fault of the Company and of the Underwriters shall
be determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the
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omission to state a material fact relates to information supplied by the Company
or by the Underwriters and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
If the indemnification provided for in this Article VI is sought solely by
the Company under the fourth paragraph hereof and there is no claim for
indemnification by any Underwriter or any person controlling such Underwriter
arising out of the same misstatement or omission and if such indemnification is
unavailable to the Company in respect of any losses, claims, damages or
liabilities referred to in such fourth paragraph, then each Underwriter, in lieu
of indemnifying the Company, shall contribute to the amount paid or payable by
the Company as a result of such losses, claims, damages or liabilities in such
proportion as is appropriate to reflect the relative fault of the Company on the
one hand and of such Underwriter or Underwriters on the other in connection with
the statements or omissions which resulted in such losses, claims, damages or
liabilities, as well as any other relevant equitable considerations. The
relative fault of the Company on the one hand and of such Underwriter or
Underwriters on the other 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 by the Underwriters and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Article VI were determined by pro
rata allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to in the two immediately preceding
paragraphs. The amount paid or payable by an indemnified party as a result of
the losses, claims, damages and liabilities referred to in such paragraphs 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. Notwithstanding the
provisions of this Article VI, no Underwriter shall be required to contribute
any amount in excess of the amount by which the total price at which the
[Securities][Shares] underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages which such Underwriter
has otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act of
1933) shall be entitled to contribution from any person who is not guilty of
such fraudulent misrepresentation. The Underwriters' obligations to contribute
pursuant to this Article VI are several in proportion to their respective
underwriting percentages (as defined in the Agreement Among Underwriters
relating to the [Securities][Shares]) and not joint.
The indemnity and contribution agreements contained in this Article VI and
the representations and warranties of the Company set forth in this Agreement
shall remain operative and in full force and effect 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 Company, its directors or officers or any person controlling the Company and
(iii) acceptance of and payment for any of the [Securities][Shares].
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VII.
This Agreement shall be subject to termination in your absolute discretion,
by notice given to the Company, if (a) prior to the Closing Date (i) trading in
securities on the
New York Stock Exchange or the American Stock Exchange shall
have been suspended or materially limited, (ii) trading in any securities of the
Company shall have been suspended on any national securities exchange in the
United States or in any over-the-counter market in the United States, (iii) a
general moratorium on banking activities in
New York shall have been declared by
Federal or
New York State authorities or (iv) there shall have occurred any
outbreak or escalation of hostilities or any change in the financial markets or
other calamity or crisis, any of which is material and adverse and (b) in the
case of any of the events specified in clauses (a)(i) through(iv), such event
either singly or together makes it, in your reasonable judgment, impracticable
to market the [Securities][Shares]. Any termination of this Agreement pursuant
to this Article VII shall be without liability on the part of the Company to the
Underwriters, or the Underwriters to the Company.
VIII.
This Agreement shall become effective upon signature.
If any one or more of the Underwriters shall fail or refuse to purchase
[Securities] [Shares] which it or they have agreed to purchase hereunder, and
the aggregate [principal amount of Securities][number of Shares] which such
defaulting Underwriter or Underwriters agreed but failed or refused to purchase
is not more than one-tenth of the aggregate [principal amount of
Securities][number of Shares], the other Underwriters shall be obligated
severally in the proportions which the [principal amount of Securities][number
of Shares] set forth opposite their names in Article I bears to the aggregate
[principal amount of Securities][number of Shares] so set forth opposite the
names of all such non-defaulting Underwriters, or in such other proportions as
you may specify, to purchase the [Securities][Shares] which such defaulting
Underwriter or Underwriters agreed but failed or refused to purchase; provided
that in no event shall the [principal amount of Securities][number of Shares]
which any Underwriter has agreed to purchase pursuant to Article I hereof be
increased pursuant to this Article VIII by an amount in excess of one-ninth of
such [principal amount of Securities][number of Shares] without the written
consent of such Underwriter. If any Underwriter or Underwriters shall fail or
refuse to purchase [Securities][Shares] and the aggregate [principal amount of
Securities][number of Shares] with respect to which such default occurs is more
than one-tenth of the aggregate [principal amount of Securities][number of
Shares] and arrangements satisfactory to you and the Company for the purchase of
such [Securities][Shares] are not made within 36 hours after such default, this
Agreement will terminate without liability on the part of any non-defaulting
Underwriter or of the Company. In any such case which does not result in such a
termination, either you or the Company shall have the right to postpone the
Closing Date, but in no event for longer than seven days, in order that the
required changes, if any, in the Registration Statement and in the Prospectus or
in any other documents or arrangements may be effected. Any action
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taken under this paragraph shall not relieve any defaulting Underwriter from
liability in respect of any default of such Underwriter under this Agreement.
If this Agreement shall be terminated by the Underwriters, or any of them,
because of any failure or refusal on the part of the Company to comply with the
terms or to fulfill any of the conditions of this Agreement or if for any reason
the Company shall be unable to perform its obligations under this Agreement, the
Company will reimburse the Underwriters or such Underwriters as have so
terminated this Agreement with respect to themselves, severally, for all
out-of-pocket expenses (including the fees and disbursements of their counsel)
reasonably incurred by such Underwriters in connection with this Agreement or
the offering contemplated hereunder.
This Agreement shall be governed by and construed in accordance with the
laws of the State of
New York.
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This Agreement may be signed in various counterparts which together shall
constitute one and the same instrument.
Very truly yours,
THE UNION LIGHT, HEAT AND POWER
COMPANY
By:
--------------------------
[title]
Accepted:
__________________________________.
[Name of Managing Underwriter]
on behalf of the Underwriters
named in Article I hereof
By:
--------------------------------
[title]
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