DRAFT DATED: November 29, 1995
CITIZENS UTILITIES COMPANY
CITIZENS UTILITIES TRUST
$175,000,000 ___% Citizens Utilities
Convertible Preferred Securities
UNDERWRITING AGREEMENT
New York, New York
_____________, 199_
To the Representatives named in Schedule
I of each of the several Underwriters named
in Schedule II hereto
Dear Sirs:
Citizens Utilities Trust (the "Trust"), a statutory business trust
organized under the Business Trust Act (the "Delaware Act") of the State of
Delaware (Chapter 38, Title 12, of the Delaware Code, 12 Del. C. (subsection)
3801 et seq.), and Citizens Utilities Company, a Delaware corporation (the
"Company" and, together with the Trust, the "Offerors"), propose, subject to
the terms and conditions stated herein, to issue and sell, severally and not
jointly, to the Underwriters named in Schedule II hereto (the "Underwriters")
for whom you are acting as representatives (the "Representatives") (i) that
aggregate principal amount of ___% Citizens Utilities Convertible Preferred
Securities (the "Convertible Preferred Securities") of the Trust specified
in Schedule I hereto and (ii) an option described in Section 2 hereof to
purchase all or any part of the aggregate amount of additional Convertible
Preferred Securities to cover overallotments as is specified in Schedule I
hereto. The Convertible Preferred Securities will be guaranteed by the
Company with respect to distributions and payments upon liquidation,
redemption and otherwise (the "Convertible Preferred Securities Guarantee")
pursuant to the Convertible Preferred Securities Guarantee Agreement (the
"Convertible Preferred Securities Guarantee Agreement"), dated as of _______,
199_, between the Company and Chemical Bank, as trustee (the "Guarantee
Trustee"), and entitled to the benefits of certain backup undertakings by the
Company ("back-up undertakings") pursuant to the Indenture, the Declaration
and the Limited Partnership Agreement (each as defined herein) to pay certain
expenses relating to the transactions described herein. The Convertible
Preferred Securities to be purchased initially by the Underwriters (the
"Initial Securities"), together with all or any part of the Convertible
Preferred Securities subject to the option described in Section 2 hereof (the
"Option Securities"), are collectively hereinafter called the "Convertible
Preferred Securities" and the Convertible Preferred Securities and the
related Convertible Preferred Securities Guarantee are referred to herein as
the "Securities".
The Offerors have filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (Nos. 33-63615-01, 33-
63615-02 and 33-63615-03) and a related preliminary prospectus for the
registration under the Securities Act of 1933 (the "Act") of up to a
combination of $201,250,000 of (i) the Convertible Preferred Securities, (ii)
the Convertible Preferred Securities Guarantee, (iii) limited partnership
interests ("Partnership Preferred Securities") of Citizens Utilities Capital
L.P. ("Citizens Capital"), (iv) the Partnership Guarantee (as defined
herein), (v) the back-up undertakings, (vi) Common Stock Series A of the
Company, par value $.25 per share, and Common Stock Series B of the Company,
par value $.25 per share, into which the Convertible Preferred Securities are
convertible, (vii) the Convertible Debentures (as defined herein) to be
issued and sold to Citizens Capital by the Company and (viii) up to
$40,000,000 of Common Stock Series A and B, to be distributed as
distributions on the Convertible Preferred Securities, and have filed such
amendments and supplements thereto, if any, and such amended and supplemented
preliminary prospectuses as may have been required to the date hereof, and
will file such additional amendments and supplements thereto and such amended
and supplemented prospectuses as may hereafter be required.
The registration statement and prospectus, as amended or supplemented prior
to the date of this Agreement, are hereinafter called the "Registration
Statement" and the "Prospectus", respectively. Any reference herein to the
Registration Statement or the Prospectus shall be deemed to refer to and
include the documents incorporated by reference therein pursuant to Item 12
of Form S-3 which were filed under the Securities Exchange Act of 1934 (the
"Exchange Act") on or before the date of this Agreement, and any reference
herein to the terms "amend", "amendment" or "supplement" with respect to the
Registration Statement or the Prospectus shall be deemed to include the
filing of any document under the Exchange Act deemed to be incorporated by
reference therein after the date of this Agreement.
The Offerors understand that the Underwriters propose to make a public
offering of the Securities as soon as the Representatives deem advisable, and
the Declaration, the Indenture, the Convertible Preferred Securities
Guarantee Agreement and the Partnership Guarantee Agreement (as defined
herein) have been qualified under the Trust Indenture Act of 1939 (the "Trust
Indenture Act").
The entire net proceeds from the sale of the Securities will be
combined with the entire net proceeds from the sale by the Trust to the
Company of its convertible common securities (the "Convertible Common
Securities"), as guaranteed by the Company with
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respect to distributions and payments upon liquidation and redemption (the
"Convertible Common Securities Guarantee" and, together with the Convertible
Preferred Securities Guarantee, the "Trust Guarantees") pursuant to the
Convertible Common Securities Guarantee Agreement (the "Convertible Common
Securities Guarantee Agreement" and, together with the Convertible Preferred
Securities Guarantee Agreement, the "Trust Guarantee Agreements"), dated as
of _______, 199_, between the Company and the Guarantee Trustee, as trustee,
and will be used by the Trust to purchase up to $207,475,000 Partnership
Preferred Securities from Citizens Capital, as guaranteed by the Company with
respect to distributions and payments upon liquidation and redemption (the
"Partnership Guarantee" and together with the Trust Guarantees, the
"Guarantees") pursuant to the Partnership Preferred Securities Guarantee
Agreement (the "Partnership Guarantee Agreement" and, together with the Trust
Guarantee Agreements, the "Guarantee Agreements"), dated as of _______, 199_,
between the Company and the Guarantee Trustee, as trustee. The entire net
proceeds from the sale of Partnership Preferred Securities will be combined
with the entire net proceeds from the sale by Citizens Capital to the Company
of its general partnership interest, and will be used by Citizens Capital to
purchase up to $213,895,000 of ____% Convertible Subordinated Debentures (the
"Convertible Debentures") issued by the Company and Eligible Investments (as
defined in the Limited Partnership Agreement).
The Convertible Preferred Securities and the Convertible Common Securities
will be issued pursuant to the amended and restated declaration of trust of
the Trust, dated as of __________, 199_ (the "Declaration"), among the
Company, as Sponsor, Robert J. DeSantis and Edward O. Kipperman, as trustees
(the "Regular Trustees"), Chemical Bank, a New York banking corporation, as
property trustee (the "Property Trustee") and Chemical Bank Delaware, a
Delaware banking corporation, as Delaware Trustee (the "Delaware Trustee"
and, together with the Property Trustee and the Regular Trustees, the
"Trustees"), and to the holders from time to time of undivided beneficial
interests in the assets of the Trust. The Convertible Debentures will be
issued pursuant to an indenture, dated as of __________, 199_ (the "Base
Indenture"), between the Company and Chemical Bank, as trustee (the
"Debenture Trustee"), and a supplement to the Base Indenture, dated as of
__________, 199_ (the "First Supplemental Indenture," and, together with the
Base Indenture and any other amendments or supplements thereto, the
"Indenture"), between the Company and the Debenture Trustee.
1. Representations and Warranties by the Offerors. The Offerors,
jointly and severally, represent and warrant to each Underwriter that:
A. (i) The Registration Statement, at the time it becomes
effective, any post-effective amendment thereto, at the time it becomes
effective, the Prospectus, at the date of this Agreement and at the
Closing Date (as hereinafter defined), any amendments thereof and
supplements thereto will comply in all material respects with the Act
and the Exchange Act and the respective rules thereunder and (ii) the
Registration Statement will not contain any untrue statement of a
material fact or will
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omit to state any material fact required to be stated therein or
necessary in order to make the statements therein not
misleading and the Prospectus and any amendment thereof or supplement
thereto does not contain and will not contain any untrue statement of
a material fact or omits or will 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 under which they
were made, not misleading; provided, however, that the Offerors make
no representations or warranties as to (A) that part of the
Registration Statement which shall constitute the Statements of
Eligibility and Qualification (Forms T-1) under the Trust Indenture Act
of the Property Trustee, the Debenture Trustee and the Guarantee
Trustee or (B) the information contained in or omitted from the
Registration Statement or the Prospectus or any amendment thereof or
supplement thereto in reliance upon and in conformity with information
furnished in writing to the Offerors by or on behalf of any Underwriter
through the Representatives specifically for use in connection with the
preparation of the Prospectus.
B. The documents incorporated by reference in the Prospectus,
when they were filed with the Commission, conformed in all material
respects to the requirements of the Act or the Exchange Act and the
rules and regulations of the Commission thereunder, and any documents
so filed and incorporated by reference subsequent to the date of this
Agreement will, when they are filed with the Commission, conform in all
material respects to the requirements of the Act and the Exchange Act,
and the rules and regulations of the Commission thereunder; and none
of such documents include or will include any untrue statement of a
material fact or omit or will omit to state any 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. Subsequent to the respective dates as of which information
is given in the Registration Statement and the Prospectus, except as
set forth in the Registration Statement and the Prospectus, there has
not been any material adverse change in the business, properties or
financial condition of the Trust, the Company and the Company's
subsidiaries, considered as a whole, and there have not been any
transactions entered into by the Trust, the Company or any of the
Company's subsidiaries which is material to the Trust, the Company and
the Company's subsidiaries, considered as a whole, other than
transactions in the ordinary course of business and transactions
contemplated by the Registration Statement or Prospectus.
D. Neither the issuance or sale of the Convertible Preferred
Securities, the Convertible Common Securities, the Convertible
Debentures, the Guarantees nor the Partnership Preferred Securities,
nor the performance of the terms and provisions thereof and of this
Agreement, the Declaration, the Indenture, the Limited Partnership
Agreement and the Guarantee Agreements will conflict with, result in
a breach of or constitute a default under the terms of the Certificate
of Incorporation or By-Laws of
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the Company, the Declaration or Certificate of Trust of the Trust, the
Limited Partnership Agreement or any indenture, mortgage, deed of trust
or other agreement or instrument to which the Offerors are a party or
by which they are bound or any order or regulation applicable to the
Offerors of any court, regulatory body, administrative agency or
governmental body having jurisdiction over the Offerors.
E. The Trust has been duly created and is validly existing in
good standing as a business trust under the Delaware Act with the power
and authority to own property and to conduct its business as described
in the Registration Statement and Prospectus and to enter into and
perform its obligations under this Agreement, the Convertible Preferred
Securities, the Convertible Common Securities and the Declaration and
is not required to be authorized to do business in any other
jurisdiction; and the Trust is not a party to or otherwise bound by any
agreement other than those described in the Prospectus.
F. The Declaration has been duly authorized by the Company and
the Trust and, on the Closing Date, will have been duly executed and
delivered by the Company and the Regular Trustees, and assuming due
authorization, execution and delivery of the Declaration by the
Property Trustee and the Delaware Trustee, the Declaration will, on the
Closing Date, be a valid and legally binding obligation of the Company
and the Trustees, enforceable against the Company and the Trustees in
accordance with its terms, except to the extent that enforcement
thereof may be limited by bankruptcy, insolvency, reorganization or
other laws from time to time in effect relating to or affecting the
enforcement of creditors' rights generally, and by the application of
general principles of equity, which may limit the availability of
remedies provided for by such document, and the requirement of good
faith and fair dealing (the "Exceptions"), and will conform to the
description thereof in the Prospectus; and, on the Closing Date, the
Declaration will have been duly qualified under the Trust Indenture
Act.
G. The Convertible Preferred Securities have been duly
authorized by the Declaration and, when issued and delivered pursuant
to this Agreement against payment of the consideration set forth
herein, will be validly issued and fully paid and non-assessable
undivided beneficial interests in the assets of the Trust, will be
entitled to the benefits of the Declaration and will conform to the
description thereof in the Prospectus; the issuance of the Convertible
Preferred Securities is not subject to preemptive or other similar
rights; and holders of Convertible Preferred Securities will be
entitled to the same limitation of personal liability extended to
stockholders of corporations for profit.
H. The Convertible Common Securities have been duly authorized
by the Declaration and, when issued and delivered by the Trust to the
Company against payment therefor as described in the Registration
Statement and Prospectus, will be validly issued and fully paid and
non-assessable undivided beneficial interests in the
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assets of the Trust and will conform to the description thereof in the
Prospectus; the issuance of the Convertible Common Securities is not
subject to preemptive or other similar rights; and on the Closing Date,
all of the issued and outstanding Convertible Common Securities of the
Trust will be directly owned by the Company.
I. Citizens Capital has been duly created and is validly
existing in good standing as a limited partnership under the laws of
the State of Delaware with the power and authority to own property and
to conduct its business as described in the Registration Statement and
Prospectus and to enter into and perform its obligations under Limited
Partnership Agreement and is not required to be authorized to do
business in any other jurisdiction; and Citizens Capital is not a party
to or otherwise bound by any agreement other than those described in
the Prospectus.
J. The Amended and Restated Agreement of Limited Partnership
(the "Limited Partnership Agreement") has been duly authorized by the
Company and CU CapitalCorp. ("CUCC"), its wholly owned subsidiary, and,
on the Closing Date, will have been duly executed and delivered by the
Company and CUCC, and will be a valid and legally binding obligation
of the Company and CUCC, enforceable against the Company and CUCC in
accordance with its terms, except to the extent that enforcement
thereof may be limited by Exceptions, and will conform to the
description thereof in the Prospectus.
K. The Partnership Preferred Securities have been duly
authorized and, when issued and delivered pursuant to the Limited
Partnership Agreement against payment of the consideration set forth
therein, will be validly issued and fully paid and non-assessable
limited partnership interests in Citizens Capital, will be entitled to
the benefits of the Limited Partnership Agreement and will conform to
the description thereof in the Prospectus; the issuance of the
Partnership Preferred Securities is not subject to preemptive or other
similar rights; assuming that the holders of Partnership Preferred
Securities in their capacities as such do not participate in the
control of the business of Citizens Capital, the holders of the
Partnership Preferred Securities, in their capacities as such, will
have no liability in excess their obligations to make payments provided
for in the Limited Partnership Agreement (subject to the obligation of
a holder of Partnership Preferred Securities to repay any funds
distributed to it).
L. When the Base Indenture and the First Supplemental
Indenture relating to the Convertible Debentures have been executed and
delivered by the Company and the Debenture Trustee, the Base Indenture,
including such Supplemental Indenture, will have been duly authorized
and delivered and will be a valid and legally binding instrument
enforceable against the Company in accordance with its terms, except
as such enforcement may be limited by Exceptions, and will conform to
the description thereof in the Prospectus; and on the Closing Date, the
Indenture will have been duly qualified under the Trust Indenture Act.
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M. the Convertible Debentures have been duly authorized by the
Company, and, when authenticated in the manner provided for in the
Indenture and when issued and delivered against payment therefor as
described in the Prospectus, will have been duly executed,
authenticated, issued and delivered, will constitute valid and legally
binding obligations of the Company entitled to the benefits and
security of the Indenture in accordance with their and its terms,
except as such enforcement may be limited by Exceptions, and will
conform to the description thereof in the Prospectus.
N. Each of the Guarantee Agreements has been duly authorized
by the Company and, when executed and delivered by the Company and (in
the case of the Convertible Preferred Securities Guarantee Agreement
and the Partnership Guarantee Agreement, assuming due authorization,
execution and delivery by the Guarantee Trustee) will constitute a
valid and legally binding obligation of the Company, enforceable
against the Company in accordance with its terms except as such
enforcement may be limited by Exceptions, and each of the Guarantees
and the Guarantee Agreements will conform to the descriptions thereof
in the Prospectus; and, on the Closing Date, the Convertible Preferred
Securities Guarantee Agreement and the Partnership Guarantee Agreement
will have been duly qualified under the Trust Indenture Act.
O. The Company's obligations under the Guarantees are
subordinate and junior in right of payment to all Senior Indebtedness
(as defined in the Indenture) of the Company.
P. The Convertible Debentures are subordinated and junior in
right of payment to all Senior Indebtedness of the Company.
Q. Robert J. DeSantis and Edward O. Kipperman, as Regular
Trustees of the Trust, are employees of the Company and have been duly
authorized by the Company to execute and deliver the Declaration.
R. None of the Offerors or Citizens Capital is an "investment
company" or a company "controlled" by an "investment company" within
the meaning of the Investment Company Act of 1940 (the "1940 Act").
2. Purchase and Sale. Subject to the terms and conditions and
in reliance upon the representations and warranties herein set forth, the
Trust agrees to sell to you and each other Underwriter, severally and not
jointly, and you and each other Underwriter agree, severally and not jointly,
to purchase from the Trust, at the purchase price set forth in Schedule I
hereto, the respective principal amount of Initial Securities set forth
opposite such Underwriter's name in Schedule II hereto, plus any additional
principal amount of Convertible Preferred Securities which such Underwriter
may become obligated to purchase pursuant to the provisions of Section 9
hereof.
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In addition, on the basis of the representations and warranties
herein contained and subject to the terms and conditions herein set forth,
the Trust hereby grants an option to the Underwriters, severally and not
jointly, to purchase up to the principal amount of additional Convertible
Preferred Securities set forth on Schedule I hereto at the price set forth
on Schedule I hereto. The option hereby granted will expire 30 days after
the date of this Underwriting Agreement, and may be exercised in whole or in
part from time to time only for the purpose of covering over-allotments which
may be made in connection with the offering and distribution of the Initial
Securities upon notice by the Representatives to the Trust setting forth the
principal amount of Option Securities as to which the Underwriters are then
exercising the option and the time, date and place of payment and delivery
for such Option Securities. Any such time and date of delivery (a "Date of
Delivery") shall be determined by the Representatives, but shall not be later
than seven full business days after the exercise of said option, nor in any
event prior to the Closing Date, as hereinafter defined, unless otherwise
agreed upon by the Representatives and the Trust. If the option is exercised
as to all or any portion of the Option Securities, the Option Securities
shall be sold by the Trust and shall be purchased by the Underwriters,
severally and not jointly, in proportion to their respective Initial Security
underwriting obligations as set forth in Schedule II.
3. Delivery, Payment and Offering. Delivery of and payment
for the Initial Securities shall be made at the place, date and time speci-
fied in Schedule I hereto (or such other place, date and time not later than
ten full business days thereafter as the Representatives, the Company and the
Trust shall designate), which date and time may be postponed by agreement
between the Representatives, the Company and the Trust or as provided in
Section 9 hereof (such date and time being herein called the "Closing" or
"Closing Date"). Delivery of the Initial Securities shall be made to the
Representatives for the respective accounts of the several Underwriters
against payment by the several Underwriters through the Representatives of
the purchase price thereof to or upon the order of the Trust payable in
federal (same day) funds. The Initial Securities shall be in definitive form
and shall be registered in such names and in such authorized denominations
as the Representatives may request not less than three full business days in
advance of the Closing Date. The Trust agrees to have the Initial Securities
available for inspection, checking and packaging by the Representatives in
New York, New York, not later than 10:00 A.M., New York City time, on the
last business day prior to the Closing Date.
In addition, in the event that any or all of the Option
Securities are purchased by the Underwriters, delivery of and payment for the
Option Securities shall be made on the Date of Delivery at the offices
designated on Schedule I at 10:00 A.M. New York City time (or such other time
and place as the Representatives, the Company and the Trust shall designate),
which date and time may be postponed by agreement between the
Representatives, the Company and the Trust or as provided in Section 9 hereof
and which date may also be the Closing Date. Delivery of the Option
Securities shall be made to the Representatives for the respective accounts
of the several Underwriters against payment by or on behalf of the
Underwriters through the Representatives of the purchase price thereof to or
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upon the order of the Trust payable in federal (same day) funds. The Option
Securities shall be in definitive form and shall be registered in such names
and in such authorized denominations as the Representatives may request not
less than three full business days in advance of the Date of Delivery. The
Trust agrees to have the Option Securities available for inspection, checking
and packaging by the Representatives in New York, New York, not later than
10:00 a.m., New York City time, on the last business day prior to the Date
of Delivery.
It is understood that each Underwriter has authorized the
Representatives, for its account, to accept delivery of, receipt for, and
make payment of the purchase price for, the Securities which it has agreed
to purchase.
On the Closing Date, the Company will pay, or cause to be paid,
the commission payable at such time to the Underwriters under Section 2
hereof payable in federal (same day) funds.
Subject to the terms and conditions of this Agreement, the
Underwriters agree to make a bona fide public offering of the Securities as
soon as the Representatives deem advisable after this Agreement has been
executed and delivered.
4. Agreements. Each of the Offerors jointly and severally
agrees with the several Underwriters that:
(a) During the period for which a prospectus relating to the
Securities is required to be delivered under the Act, the Offerors will
promptly advise the Representatives (i) when the Registration Statement
shall have become effective, (ii) of any request by the Commission for
any amendment of or supplement to the Registration Statement or the
Prospectus or for any additional information, (iii) of the issuance by
the Commission of any stop order suspending the effectiveness of the
Registration Statement or the institution or threatening of any
proceedings for that purpose, and (iv) of the receipt by the Company
of any notification with respect to the suspension of the qualification
of the Securities for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose. The Offerors will use
their best efforts to prevent the issuance of any such stop order and,
if issued, to obtain as soon as possible the withdrawal thereof. The
Offerors will not file any amendment to the Registration Statement or
supplement to the Prospectus (other than any prospectus supplement
relating to the offering of Securities registered under the
Registration Statement and other than any document required to be filed
under the Exchange Act which upon filing is deemed to be incorporated
by reference in the Registration Statement or Prospectus) unless the
Offerors have furnished to the Representatives a copy for their review
prior to filing and will not file any such proposed amendment or
supplement to which they reasonably object. The Offerors will furnish
to the Representatives prior to the filing thereof a copy of any such
prospectus supplement and any document which upon filing is deemed to
be
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incorporated by reference in the Registration Statement or Prospectus.
(b) If, at any time when a prospectus relating to the
Securities is required to be delivered under the Act, any event occurs
as a result of which the Prospectus as then amended or supplemented
would include any untrue statement of a material fact or omit to state
any material fact necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading,
or if it shall be necessary at any time to amend or supplement the
Prospectus to comply with the Act or the Exchange Act or the respective
rules thereunder, the Company promptly will prepare and file with the
Commission, subject to paragraph (a) of this Section 4, an amendment
or supplement which will correct such statement or omission or an
amendment or supplement which will effect such compliance.
(c) The Offerors will furnish such information, execute such
instruments and take such action as may be required to qualify the
Securities for sale under the laws of those states specified in a
writing heretofore delivered by you and countersigned by the Offerors
and such other jurisdictions as the Representatives may designate in
which there is a change of law or regulation after the date hereof
affecting the status of the Securities as exempt Securities under such
laws and will maintain such qualifications in effect so long as
required for the distribution of the Securities; provided, however,
that neither Offeror shall be required to qualify to do business in any
jurisdiction where it is not now so qualified or to take any action
which would subject it to general or unlimited service of process in
any jurisdiction where it is not now so subject.
(d) The Offerors will furnish to the Representatives a signed
copy of the registration statement as originally filed and of each
amendment thereto, including copies of all documents incorporated by
reference in the Prospectus, Statements on Form T-1 of Chemical Bank,
as Debenture Trustee, Guarantee Trustee and Property Trustee, all
powers of attorney, consents and exhibits filed therewith (other than
exhibits incorporated by reference), and will deliver to the
Representatives conformed copies of the Registration Statement, the
Prospectus, including any documents incorporated by reference therein
at or after the date thereof and, so long as delivery of a prospectus
by a Underwriter or dealer may be required by the Act, all amendments
of and supplements to such documents, in each case as soon as available
and in such quantities as the Representatives may reasonably request.
(e) For a period of five calendar years from the date of this
Agreement, the Company will furnish (or cause to be furnished) to each
of the Representatives, upon request, copies of (i) all reports to
stockholders of the Company and (ii) all reports and financial
statements filed with the Commission or with the New York Stock
Exchange.
(f) During the period beginning from the date of this Agreement
and
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continuing to and including the 90th day after the date of the
Prospectus, neither the Trustee nor the Company will offer, sell, or
otherwise dispose of any Convertible Preferred Securities or Common
Stock, or any securities convertible into or exchangeable or
exercisable for any such Convertible Preferred Securities or Common
Stock (except for stock dividends paid in the normal course, stock
splits or stock splits carried out in the form of stock dividends,
shares sold under the Company's stock dividend sale plan, shares issued
under employee or director stock option or other employee or director
benefit or stock purchase and sale or other ownership plans and shares
issued under stockholder ownership plans, securities of the Company
convertible into Common Stock issued to a subsidiary of the Company,
all of the outstanding common stock of which is directly or indirectly
owned by the Company, shares issued as consideration in connection with
acquisitions which have been disclosed to you and securities under
prior contractual commitments, if any, which have been disclosed to
you), without the prior written consent of the Representatives, which
consent shall not be unreasonably withheld.
(g) The Company will make generally available to its security
holders and to the Representatives, as soon as practicable, but not
later than sixteen months after the "effective date" of the
Registration Statement (as such term is defined in Rule 158(c) under
the Act), a consolidated earning statement (which need not be audited)
of the Company, covering a period of twelve-months beginning after such
effective date which will satisfy the provisions of Section 11(a) of
the Act.
(h) The Offerors will use their best efforts to have the
Convertible Preferred Securities listed, subject to notice of issuance,
on the New York Stock Exchange on or before the Closing Date; if the
Convertible Preferred Securities are exchanged for Partnership
Preferred Securities or Convertible Debentures, the Company will use
its best efforts to have the Partnership Preferred Securities or
Convertible Debentures, as the case may be, listed on the exchange on
which the Convertible Preferred Securities were then listed.
(i) The Offerors will apply the net proceeds from the sale of
the Convertible Preferred Securities substantially in accordance with
the description set forth in the Prospectus under "Use of Proceeds".
5. Expenses. The Company will pay or cause to be paid the
following:
(i) the fees, disbursements and expenses of the Trust's, the
Company's and Citizens Capital's counsel (except as provided in
subparagraph (x) below) and accountants in connection with the
registration of the Convertible Preferred Securities, the Partnership
Preferred Securities, the Convertible Debentures, the shares of Common
Stock Series A and B, the Convertible Preferred Securities Guarantee
and the Partnership Guarantee under the Act and all other expenses in
connection with the preparation, printing and filing of the
Registration Statement and the Prospectus and
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amendments and supplements thereto and the furnishing of copies thereof
and of any preliminary Prospectus to the Underwriters and dealers, and
all fees, if any, payable to the National Association of Securities
Dealers, Inc.or the New York Stock Exchange;
(ii) the cost of printing this Agreement, the Indenture and the
Blue Sky Survey;
(iii) all expenses including fees and disbursements of counsel
(up to a maximum of $5,500) in connection with the qualification of the
Convertible Preferred Securities, the Partnership Preferred Securities,
the Convertible Debentures, the shares of Common Stock Series A and B,
the Convertible Preferred Securities Guarantee and the Partnership
Guarantee under the securities or Blue Sky laws of such jurisdictions
as the Representatives shall reasonably request and the preparation of
a Blue Sky Survey;
(iv) any fees charged by the rating services for rating the
Convertible Preferred Securities and the Convertible Debentures;
(v) the cost of preparing certificates for the Convertible
Preferred Securities, the Partnership Preferred Securities, the
Convertible Debentures and the shares of Common Stock Series A and B;
(vi) the fees and expenses of the Debenture Trustee and any
agent of the Debenture Trustee and the fees and disbursements of
counsel for the Debenture Trustee in connection with the Indenture and
the Convertible Debentures;
(vii) the fees and expenses of the Property Trustee, the
Delaware Trustee and the Guarantee Trustee and any agent of the
Property Trustee, the Delaware Trustee and the Guarantee Trustee and
the fees and disbursements of counsel for the Property Trustee and the
Delaware Trustee in connection with the Declaration and the Certificate
of Trust, and the fees and disbursements of counsel for the Guarantee
Trustee in connection with the Convertible Preferred Securities
Guarantee and the Partnership Guarantee;
(viii) the cost and charges of any transfer agent or registrar;
(ix) the cost of qualifying the Convertible Preferred Securities
with the Depositary Trust Company; and
(x) all other costs and expenses incident to the performance
of the Company's and the Trust's obligations hereunder which are not
otherwise specifically provided for in this Section 5. Except as
provided in Section 5 and Section 11 hereof, the Underwriters will pay
12
all of their own costs and expenses, including the fees of their
counsel, transfer taxes on resale of any of the Securities by them, and
any advertising expenses connected with any offers they may make. The
Offerors shall not in any event be liable to any of the several
Underwriters for damages on account of loss of anticipated profits.
6. (a) Conditions to the Obligations of the Underwriters. The
obligations of the Underwriters to purchase the Initial Securities shall be
subject to the accuracy in all material respects of the representations and
warranties on the part of the Company and the Trust contained herein (except
insofar as such representations and warranties have already been qualified
therein as to materiality) as of the date hereof and the Closing Date, to the
accuracy of the statements of Company officers and Trust Trustees made in any
certificates given pursuant to the provisions hereof, to the performance by
the Company and the Trust of its respective obligations hereunder and to the
following additional conditions:
(i) The Registration Statement shall have become effective no
later than 5:30 p.m. on the date hereof, or with the consent of the
Representatives, at a later time and date; and no stop order suspending
the effectiveness of the Registration Statement shall have been issued
and no proceeding for that purpose shall have been initiated or
threatened by the Commission;
(ii) There shall be in full force and effect, on the date of
this Agreement and on the Closing Date, an order or orders, if
necessary, of the Federal Energy Regulatory Commission ("FERC")
authorizing the issue and sale of the Convertible Debentures, the
shares of Common Stock issuable upon conversion, shares of Common Stock
issuable in payment of interest for an estimated two years, the
Convertible Preferred Securities Guarantee and the Partnership
Guarantee, and no additional order of FERC shall be necessary for such
issuance and sale;
(iii) At the Closing Date, the Company, the Trust and Citizens
Capital shall have received all authorizations from any state
regulatory commission (other than pursuant to any state "Blue Sky"
laws), necessary for the issuance and sale of the Initial Securities
and related transactions on the terms set forth or contemplated in this
Agreement, and the issuance of the Partnership Preferred Securities,
the Convertible Debentures, the shares of Common Stock issuable upon
conversion, shares of Common Stock issuable in payment of interest for
an estimated two years; the Convertible Preferred Securities Guarantee
and the Partnership Guarantee and containing no provision unacceptable
to the Representatives, which such authorizations shall be in full
force and effect and no order or additional order of any such
commission shall be necessary for such issuance and sale which has not
been obtained;
(iv) The Convertible Preferred Securities shall have been
approved for listing on the New York Stock Exchange;
13
(v) At the Closing Date, the Representatives shall have been
furnished with the following opinions, addressed to the Representatives
(with conformed copies thereof for each of the other Underwriters), in
form and substance satisfactory to the Representatives, dated the
Closing Date or a date not more than three days prior thereto:
(A) Opinion of Boulanger, Hicks & Churchill, P.C., New
York, New York, counsel to the Offerors and Citizens Capital, in
substantially the form agreed to;
(B) Opinion of Skadden, Arps, Slate, Meagher & Flom, New
York, New York, special tax counsel to the Offerors and Citizens
Capital, in substantially the form agreed to;
(C) Opinion of Skadden, Arps, Slate, Meagher & Flom, New
York, New York, special Delaware counsel to the Offerors and
Citizens Capital, in substantially the form agreed to;
(D) Opinions of Brown & Bain, P.A., Phoenix, Arizona;
LeBouef, Lamb, Greene & MacRae, Denver, Colorado; Cades Schutte
Fleming & Wright, Honolulu, Hawaii; Marshall Ordemann, counsel
to the Louisiana Gas Division of the Company, Harvey, Louisiana;
Miller, Eggleston and Rosenberg, Ltd., Burlington, Vermont;
Stokes & Bartholomew, Nashville, Tennessee; and Jackson & Kelly,
Charleston, West Virginia (or other local counsel to the
Company), counsel to the Offerors and Citizens Capital, in
substantially the form agreed to;
(E) Opinion of Pryor, Cashman, New York, New York, counsel
to Chemical Bank, as Property Trustee and Guarantee Trustee, and
counsel to Chemical Bank Delaware, as Delaware Trustee, in
substantially the form agreed to; and
(F) Opinion of Simpson Thacher & Bartlett, New York, New
York, counsel to the Underwriters with respect to the validity
of the Securities, the Registration Statement, the Prospectus,
and other related matters as the Representatives may reasonably
require, and the Offerors shall have furnished to such counsel
such documents as they reasonably request for the purpose of
enabling them to pass upon such matters;
(vi) On each of the date hereof and the Closing Date, the
Representatives shall have been furnished a letter dated the date
hereof or the Closing Date, as the case may be, in form and substance
satisfactory to the Representatives, from KPMG Peat Marwick, the
Company's independent public accountants, containing statements and
information heretofore agreed upon with respect to the financial
statements and
14
certain financial information contained in or incorporated by reference
into the Prospectus;
(vii) At the Closing Date, the Representatives shall have
received a certificate, dated the Closing Date, signed by an officer
of the Company, to the effect that, (A) since the respective dates as
of which information is given in the Registration Statement and
Prospectus, there has not been any material adverse change in the
business, properties or financial condition of the Company and its
subsidiaries, considered as a whole; provided that a downgrading of the
rating of the Company's publicly-held securities by itself shall not
be deemed to be a "material adverse change", and (B) since such dates,
there has not been any transaction entered into by the Company or any
of its subsidiaries other than transactions referred to in, or
contemplated by, the Registration Statement and Prospectus and
transactions which are not material to the Company and its subsidiaries
considered as a whole; and
(viii) At the Closing Date, the Representatives shall have
received a certificate, dated the Closing Date signed by an officer of
the Company, to the effect that, since the respective dates as of which
information is given in the Registration Statement and Prospectus,
neither the Company nor any of its subsidiaries shall have sustained
a loss by fire, flood, accident or other calamity which is substantial
with respect to the property of the Company and its subsidiaries,
considered as a whole. At the Closing Date the Representatives shall
have been furnished with certificates signed by an officer of the
Company and by a Regular Trustee of the Trust satisfactory to the
Representatives as to the accuracy of their representations and
warranties herein at and as of the Closing and as to the performance
by the Company and the Trust of all of their obligations hereunder to
be performed at or prior to the Closing, and the Company also shall
have furnished to the Representatives a certificate satisfactory to the
Representatives as to the matters set forth in subsections (i) and (ii)
of this Section 6(a).
(b) Option Securities Closing: In the event the Underwriters
exercise their option granted in Section 2 hereof to purchase all or any
portion of the Option Securities, the representations and warranties of the
Offerors contained herein and the statements in any certificates furnished
by the Company and the Trust hereunder shall be true and correct as of each
Date of Delivery, and the Representatives shall have received:
(i) A certificate of an officer of the Company, dated such Date
of Delivery, confirming that the certificate delivered on the Closing
Date pursuant to Section 6(a)(vii) and (viii) hereof remains true as
of such Date of Delivery.
(ii) A certificate of a Regular Trustee of the Trust, dated such
Date of Delivery, confirming that the certificate delivered on the
Closing Date pursuant to Section 6(a)(viii) hereof remains true as of
such Date of Delivery.
15
(iii) The opinion of Boulanger, Hicks & Churchill, P.C., counsel
for the Offerors and Citizens Capital, dated such Date of Delivery
relating to the Option Securities and otherwise to the same effect as
the opinion required by Section 6(a)(v)(A) hereof.
(iv) The opinion of Skadden, Arps, Slate, Meagher & Flom, New
York, New York, special tax counsel to the Offerors and Citizens
Capital, dated such Date of Delivery, relating to the Option Securities
and otherwise to the same effect as the opinion required by Section
6(a)(v)(B) hereof.
(v) The opinion of Skadden, Arps, Slate, Meagher & Flom, New
York, New York, special Delaware counsel to the Offerors and Citizens
Capital, dated such Date of Delivery, relating to the Option Securities
and otherwise to the same effect as the opinion required by Section
6(a)(v)(C) hereof.
(vi) The opinion of Pryor, Cashman, New York, New York, counsel
to Chemical Bank, as Property Trustee and Guarantee Trustee, and
counsel to Chemical Bank Delaware, as Delaware Trustee, dated such Date
of Delivery, relating to the Option Securities and otherwise to the
same effect as the opinion required by Section 6(a)(v)(E) hereof.
(vii) The opinion of Simpson Thacher & Bartlett, counsel for the
Underwriters, dated such Date of Delivery, relating to the Option
Securities and otherwise to the same effect as the opinion required by
Section 6(a)(v)(F) hereof.
(viii) A letter from KPMG Peat Marwick, dated such Date of
Delivery, substantially the same in scope and substance as the letter
furnished to the Representatives pursuant to Section 6(a)(vi) hereof,
except that the "specified date" in the letter furnished pursuant to
this Section 6(b) shall be a date not more than six days prior to such
Date of Delivery.
If any of the conditions specified in this Section 6 shall not
have been fulfilled when and as required by this Agreement, this Agreement
and all obligations of the Underwriters hereunder may be canceled at, or at
any time prior to, the Closing Date by the Representatives. Notice of such
cancellation shall be given to the Offerors in writing, or by telephone or
telegraph confirmed in writing.
7. Conditions of Company's Obligations. The obligations of
the Trust to sell and deliver the Convertible Preferred Securities are
subject to the following conditions:
(a) Prior to the Closing Date, no stop order suspending the
effectiveness of the Registration Statement shall have been issued and
no proceedings for that purpose shall have been instituted or
threatened.
16
(b) The conditions referred to in subsections (ii) and (iii)
of Section 6(a) shall have been met and no order or authorization
referred to therein shall contain any provision unacceptable to the
Company or the Trust.
If any of the conditions specified in this Section 7 shall not
have been fulfilled, this Agreement and all obligations of the Company and
the Trust hereunder, except as stated in Section 11, may be canceled on or
at any time prior to the Closing Date by the Company and the Trust. Notice
of such cancellation shall be given to the Representatives in writing or by
telephone or telegraph confirmed in writing.
8. Indemnification.
(a) The Offerors agree jointly and severally to indemnify and
hold harmless each Underwriter and each person who controls any
Underwriter within the meaning of either the Act or the Exchange Act
against any and all losses, claims, damages or liabilities, joint or
several, to which they or any of them may become subject under the Act,
the Exchange Act or other Federal or state statutory law or regulation,
at common law or otherwise insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based
upon any untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement for the registration of
the Initial Securities as originally filed or in any amendment thereof,
or arise out of or are based upon the omission or alleged omission to
state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, or arise out
of or are based upon any untrue statement or alleged untrue statement
of a material fact contained in the Prospectus or in any amendment
thereof or supplement thereto, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein, in
the light of the circumstances under which they were made, not mis-
leading, and agree to reimburse each such indemnified party for any
legal or other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim, damage, liability or
action; provided, however, that the Offerors will not be liable in any
such case to the extent that any such loss, claim, damage or liability
arises out of or is based upon any such untrue statement or alleged
untrue statement or omission or alleged omission made therein in
reliance upon and in conformity with written information furnished to
the Company or the Trust as herein stated by or on behalf of any
Underwriter through the Representatives specifically for use in
connection with the preparation thereof; and provided further that such
indemnity with respect to a preliminary prospectus included in the
registration statement or any amendment or supplement thereto shall not
inure to the benefit of any Underwriter (or any person controlling such
Underwriter) from whom the person asserting any such loss, claim,
damage or liability purchased the Securities which are the subject
thereof if such person was not sent or given by or on behalf of such
Underwriter a copy of the Prospectus as amended or supplemented (but
without the documents incorporated by
17
reference therein) at or prior to the confirmation of the sale of such
Securities to such person in any case where such delivery is required by
the Act and the untrue statement or omission of a material fact contained
in the preliminary prospectus was corrected in the Prospectus as amended
or supplemented. This indemnity agreement will be in addition to any
liability which the Company or the Trust may otherwise have.
(b) The Company agrees to indemnify the Trust against all loss,
liability, claim, damage and expense whatsoever, as due from the Trust
under Section 8(a) hereunder.
(c) Each Underwriter severally agrees to indemnify and hold
harmless each of the Offerors, each of their trustees and directors,
each of the Company's officers who has signed the Registration
Statement and each person, if any, who controls the Offerors within the
meaning of either the Act or the Exchange Act, to the same extent as
the foregoing indemnity from the Offerors to the Underwriters but only
in relation to written information furnished to the Company or the
Trust by or on behalf of such Underwriter through the Representatives
specifically for use in the preparation of the Prospectus, and agrees
to reimburse each such indemnified party for any legal or other
expenses reasonably incurred by them in connection with investigating
or defending any such loss, claim, damage, liability or action. This
indemnity agreement will be in addition to any liability which any
Underwriter may otherwise have.
(d) Promptly after receipt by an indemnified party under this
Section 8 of notice of the commencement of any action, such indemnified
party will, if a claim in respect thereof is to be made against the
indemnifying party under this Section 8, notify the indemnifying party
in writing of the commencement thereof; but the omission to so notify
the indemnifying party will not relieve it from any liability which it
may have to any indemnified party otherwise than under this Section 8.
In case any such action is brought against any indemnified party, and
it notifies the indemnifying party of the commencement thereof, the
indemnifying party will be entitled to participate therein, and to the
extent that it may elect by written notice delivered to the indemnified
party promptly after receiving the aforesaid notice from such
indemnified party, to assume the defense thereof, with counsel
satisfactory to such indemnified party; provided, however, 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 assume 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
18
counsel, the indemnifying party will not be liable to such
indemnified party under this Section 8 for any legal or other expenses
subsequently incurred by such indemnified party in connection with the
defense thereof unless (i) the indemnified party shall have employed
separate counsel in 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
Representatives in the case of subsection (a), representing the
indemnified parties under subsection (a), (b), or (c) as the case may
be, 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 claims (i) or (iii). It is understood that
all such fees and expenses shall be reimbursed as they are incurred.
(e) In order to provide for just and equitable contribution in
circumstances in which the indemnification provided for in
subparagraphs (a), (b) and (c) is due in accordance with its terms but
is for any reason unavailable from the Company, the Trust or the
Underwriters or insufficient to hold the Underwriters, the Company, the
Trust or any party covered by the foregoing indemnification harmless
in respect of any losses, claims, damages or liabilities (or actions
in respect thereof) referred to therein, the Offerors and the
Underwriters shall contribute to the aggregate losses, claims, damages
and liabilities (or actions in respect thereof) to which the Offerors
and one or more of the Underwriters may be subject, as a result of such
losses, claims, damages or liabilities (or actions in respect thereof),
in such proportion as is appropriate to reflect the relative fault of
the Offerors on the one hand and the Underwriters on the other in
connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities (or actions in respect thereof),
as well as any other equitable considerations, including relative
benefit. The 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 untrue statement of a material
fact or the omission or alleged omission to state a material fact
relates to information supplied by the Offerors on the one hand or the
Underwriters on the other and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such
statement or omission. The relative benefits received by the Offerors
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
of the Securities (before deducting expenses) received by the Offerors
bear to the total underwriting discounts and commissions received by
the Underwriters with respect to the offering of the Securities, in
each case as set forth in the table on the cover page of the
Prospectus. Notwithstanding the foregoing, no person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of
the Act)
19
shall be entitled to contribution from any person who was
guilty of such fraudulent misrepresentation. The Offerors and the
Underwriters agree that it would not be just and equitable if
contribution pursuant to this subsection (e) 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 above in this
subsection (e). The amount paid or payable by a party entitled to
contribution as a result of the losses, claims, damages or liabilities
(or actions in respect thereof) referred to above in this subsection
(e) shall be deemed to include any legal or other expenses reasonably
incurred by such party in connection with investigating or defending
any such action or claim. The Underwriters' obligations under this
subsection (e) are several in proportion to their respective
underwriting obligations and not joint. Notwithstanding the provisions
of this Section 8, no Underwriter shall be required to contribute any
amount in excess of the amount by which the total price at which the
Securities underwritten by it and distributed to the public exceeds the
amount of any damages of the kind described in Section 8(a) which such
Underwriter has otherwise paid in respect of such losses, liabilities,
claims and damages. For purposes of this subsection (e), each person,
if any, who controls a Underwriter within the meaning of either the Act
or the Exchange Act, and each officer, director and employee of a
Underwriter shall have the same rights to contribution as such
Underwriter, and each person, if any, who controls an Offeror within
the meaning of either the Act or the Exchange Act, each officer,
director and employee of the Company and each trustee of the Trust
shall have the same rights to contribution as the Company, subject to
the fourth sentence of this subsection (e).
9. Default by a Underwriter. If any one or more of the
Underwriters shall fail to purchase and pay for all of the 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 this Agreement, the remaining Underwriters shall be
obligated severally to take up and pay for (in respective proportions which
the amount of Securities set forth opposite their names in Schedule II hereto
bears to the aggregate amount of Securities set forth opposite the names of
all the remaining Underwriters) the Securities which the defaulting
Underwriter or Underwriters agreed but failed to purchase; provided, however,
that in the event that the aggregate amount of Securities which the
defaulting Underwriter or Underwriters agreed but failed to purchase shall
exceed 10% of the aggregate amount of Securities set forth in Schedule II
hereto, the remaining Underwriters shall have the right to purchase all, but
shall not be under any obligation to purchase any of, the Securities, and if
such nondefaulting Underwriters do not purchase all of the Securities, this
Agreement will terminate without liability on the part of any nondefaulting
20
Underwriter, the Trust or the Company. In the event of a default by any
Underwriter, as set forth in this Section, the Closing Date shall be
postponed for such period, not exceeding seven days, as the Representatives
shall determine in order that the required changes in the Registration
Statement and in the Prospectus or in any other documents or arrangements may
be effected. Nothing herein contained shall relieve any defaulting
Underwriter of its liability, if any, to the Offerors or any nondefaulting
Underwriter for damages occasioned by its default hereunder.
In the event of a default by a Underwriter as set forth in this
Section, either the Representatives or the Offerors shall have the right to
postpone the Closing Date or the Date of Delivery for a period of not
exceeding 7 days in order that any required changes in the Registration
Statement or Prospectus or in any other documents or arrangements may be
effected.
10. Representations and Indemnities to Survive Delivery. The
respective agreements, representations, warranties, indemnities and other
statements of an Offeror or its officers or trustees and of the several
Underwriters set forth in or made pursuant to this Agreement will remain in
full force and effect, regardless of any investigation made by or on behalf
of any Underwriter or an Offeror or any of their respective officers,
directors, trustees or employees or any controlling person within the meaning
of the Act, and will survive delivery of and payment for the Securities.
11. Termination. This Agreement shall be subject to
termination by the Underwriters by notice given by the Representatives to the
Offerors prior to the Closing Date or Date of Delivery that the
Representatives elect to terminate this Agreement on the grounds that trading
in any of the Company's securities on the New York Stock Exchange shall have
been suspended or limited or minimum price shall have been established on
such Exchange, a banking moratorium shall have been declared either by
Federal or New York State authorities, or there shall have occurred any new
outbreak or material escalation of major hostilities or other calamity or
crisis the effect of which on the financial markets in the United States is
such as to make it, in the judgment of the Representatives, impracticable to
sell the Securities or enforce contracts for the sale of the Securities.
If this Agreement shall be terminated pursuant to Section 9
hereof, the Offerors shall not then be under any liability to any Underwriter
except as provided in Sections 5, 8 and 10 hereof; but if for any other
reason the Securities are not delivered by or on behalf of the Trust as
provided herein, the Company will reimburse the Underwriters, through you,
for all out-of-pocket expenses approved in writing by you (up to a maximum
of $__________), including fees and disbursements of counsel, reasonably
incurred by the Underwriters in making preparation for the purchase, sale and
delivery of the Securities, but the Offerors shall then be under no further
liability to any Underwriter except as provided in Sections 5, 8 and 10
hereof.
12. Representation of the Underwriters. The Representatives
represent and warrant to the Offerors that they are authorized to act as the
representatives of the Underwriters in connection with this financing and
that the Representatives' execution and delivery of this Agreement and any
action under this Agreement taken by such Representatives will be binding
upon all Underwriters.
13. Notices. All communications hereunder shall be in writing
and, if sent
21
to the Representatives, shall be mailed, delivered or telegraphed and
confirmed to them at their address set forth for that purpose
in Schedule I hereto or, if sent to the Company and the Trust, will be
mailed, delivered or telegraphed and confirmed to them at High Ridge Park,
P.O. Box 3801, Stamford, Connecticut 06905, attention of Robert J. DeSantis,
Vice President and Treasurer.
14. Parties in Interest. This Agreement shall be binding upon,
and inure solely to the benefit of, the Underwriters, the Company and the
Trust and, to the extent provided in Section 8 and Section 10 hereof, the
officers, directors and trustees and controlling persons referred to in
Section 8 hereof, and their respective heirs, executors, administrators,
successors and assigns, and no other person shall acquire or have any right
or by virtue of this Agreement. No purchase of any of the Securities from
any Underwriter shall be deemed a successor or assign by reason merely of
such purchase.
15. Applicable Law. This Agreement will be governed by and
construed in accordance with the laws of the State of New York.
16. Counterparts. This Agreement may be executed in
counterparts, all of which, taken together, shall constitute a single
agreement among the parties to such counterparts.
17. Interpretation When No Representatives. In the event no
Underwriters are named in Schedule II hereto, the term "Underwriters" shall
be deemed for all purposes of this Agreement to be the Underwriter or
Underwriters named as such in Schedule I hereto, the amount of the Securities
to be purchased by any such Underwriter shall refer to that set opposite its
name in Schedule I hereto and all references to the "Representatives" shall
be deemed to refer to the Underwriter or Underwriters named in Schedule I.
22
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof,
whereupon this letter and your acceptance shall represent a binding agreement
among the Company, the Trust and the several Underwriters.
Very truly yours,
CITIZENS UTILITIES COMPANY
By__________________________________
Name: Robert J. DeSantis
Title: Vice President and Treasurer
CITIZENS UTILITIES TRUST
By__________________________________
Name: Robert J. DeSantis
Title: Trustee
By__________________________________
Name: Edward O. Kipperman
Title: Trustee
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.
[LEAD UNDERWRITER]
[Others]
By [Lead Underwriter]
By:
Name:
Title:
For themselves and as Representa-
tives of the several Underwriters
named in Schedule II to the foregoing
Agreement.
23
CITIZENS UTILITIES COMPANY
CITIZENS UTILITIES TRUST
SCHEDULE I
Underwriting Agreement dated _________________, 199_
Registration Statement Nos. 33-63615-01, 33-63615-02 and 33-63615-03
Representatives and Addresses:
Securities:
Designation: ____% Citizens Utilities Convertible
Preferred Securities
Principal Amount: $175,000,000
Date of Maturity: ______, 2035
Distribution Rate: ____% per annum, payable each January 31,
April 30, July 31 and October 31 of each
year, commencing _________, 1996, which
distributions may be deferred.
Form: Book Entry
Redemption Provisions: At any time on or after __________, 199_, or
at any time upon a Special Event.
Conversion Provisions: Convertible at any time into shares of
Common Stock Series A of the Company at a
Conversion Price of $_________.
Amount of Initial
Securities to be
purchased by
Underwriters: $175,000,000
24
Number of Option
Securities which may be
purchased by Underwriters
pursuant to Section 2: $26,250,000
Purchase Price: ______% of the liquidation value thereof[,
plus accrued distributions from ___________,
1995 to the date of payment and delivery].
Initial Public Offering
Price: ______%.
Closing Date, Time
and Location: ______________, 199_, at the offices of:
SIMPSON THACHER & BARTLETT
425 Lexington Avenue
New York, New York 10017
25
SCHEDULE II
Amount of Securities
Names of Underwriters to be Purchased
- --------------------- -------------------
26
Amount of Securities
Names of Underwriters to be Purchased
- --------------------- --------------------
Total . . . . . . . . . . . . . . . . . . . . . . . . . . .
27