EXHIBIT 1
Indianapolis Power & Light Company
Cumulative Preferred Stock
$100 Par Value
UNDERWRITING AGREEMENT BASIC PROVISIONS
The basic provisions set forth herein are intended to
be incorporated by reference in a terms agreement (a "Terms
Agreement") of the type referred to in Paragraph 2 hereof
executed by Indianapolis Power & Light Company (the "Company")
and the underwriters named therein (the "Underwriters"). With
respect to any particular Terms Agreement, the Terms Agreement,
together with the provisions hereof incorporated therein by
reference, is herein referred to as this "Agreement". Terms
defined in the Terms Agreement are used herein as therein
defined.
The Company may issue and sell from time to time series
of its Cumulative Preferred Stock, $100 par value, registered
under the registration statement referred to in Paragraph l(a)
hereof (the "New Preferred Stock"). The New Preferred Stock may
have varying designations, preferences, rights, powers,
restrictions, dividend rates and payment dates, redemption
provisions and selling prices, with all such terms for any
particular series of New Preferred Stock (together with any other
terms relating to such series) to be determined and set forth in
the Terms Agreement relating to the series.
1. The Company represents, warrants and agrees that:
(a) A registration statement on Form S-3 with respect
to the New Preferred Stock has been prepared by the Company
in conformity with the requirements of the Securities Act of
1933, as amended (the "Act"), and the rules and regulations
(the "Rules and Regulations") of the Securities and Exchange
Commission (the "Commission") thereunder and has become
effective. As used in this Agreement, (i) "Preliminary
Prospectus" means each prospectus (including all documents
incorporated therein by reference) included in that
registration statement, or amendments or supplements
thereof, before it became effective under the Act, including
any prospectus filed with the Commission pursuant to Rule
424(a) of the Rules and Regulations; (ii) "Registration
Statement" means that registration statement, as amended or
supplemented at the date of the Terms Agreement; (iii)
"Basic Prospectus" means the prospectus (including all
documents incorporated therein by reference) included in the
Registration Statement; and (iv) "Prospectus" means the
Basic Prospectus, together with each prospectus amendment or
supplement (including in each case all documents
incorporated therein by reference) specifically relating to
the New Preferred Stock, as filed with, or mailed for filing
to, the Commission pursuant to paragraph (b) or (c) of Rule
424 of the Rules and Regulations. The Commission has not
issued any order preventing or suspending the use of any
Prospectus.
(b) The Registration Statement and each Prospectus
contains, and (in the case of any amendment or supplement to
any such document, or any material incorporated by reference
in any such document, filed with the Commission after the
date as of which this representation is being made) will
contain at all times during the period specified in
Paragraph 6(c) hereof, all statements which are required by
the Act, the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), and the rules and regulations of the
Commission under such Acts; and the Registration Statement
and each Prospectus does not, and (in the case of any
amendment or supplement to any such document, or any
material incorporated by reference in any such document,
filed with the Commission after the date as of which this
representation is being made) will not at any time during
the period specified in Paragraph 6(c) hereof, contain any
untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to
make the statements therein not misleading; provided that
the Company makes no representation or warranty as to
information contained in or omitted from the Registration
Statement or any Prospectus in reliance upon and in
conformity with written information furnished to the Company
through the Underwriters by or on behalf of any Underwriter
specifically for inclusion therein.
(c) The Company is not in violation of its corporate
charter or by-laws or in default under any agreement,
mortgage or instrument, the effect of which violation or
default would be material to the Company, the execution,
delivery and performance of this Agreement and compliance by
the Company with the provisions of the New Preferred Stock
will not conflict with, result in the creation or imposition
of any lien, charge or encumbrance upon any of the assets of
the Company pursuant to the terms of, or constitute a
default under, any agreement, mortgage or instrument, or
result in a violation of the corporate charter or by-laws of
the Company or any order, rule or regulation of any court or
governmental agency having jurisdiction over the Company, or
its respective properties, and except as required by the
Act, the Exchange Act, The Public Service Commission Act of
Indiana and applicable state securities laws, no consent,
authorization or order of, or filing or registration with,
any court or governmental agency is required for the
execution, delivery and performance of this Agreement.
(d) Except as described in or contemplated by the
Registration Statement and each Prospectus, there has not
been any material adverse change in, or any adverse
development which materially affects, the business,
properties, financial condition, results of operations or
prospects of the Company from the dates as of which
information is given in the Registration Statement and each
Prospectus.
(e) Deloitte & Touche, whose report appears in the
Company's most recent Annual Report on Form 10-K which is
incorporated by reference in each Prospectus, are
independent certified public accountants as required by the
Act and the Rules and Regulations.
(f) On the Delivery Date (as defined in Paragraph 5
hereof), (i) the New Preferred Stock will have been validly
authorized and, upon payment therefor as provided in this
Agreement, will be validly issued and outstanding, will be
fully paid and nonassessable and have the rights set forth
in the Amended Articles of Incorporation, as amended, of the
Company and (ii) the New Preferred Stock will conform to the
description thereof contained in the Prospectus.
(g) The Company is duly incorporated and validly
existing under the laws of the State of Indiana, is not
required to qualify to do business as a foreign corporation
in any other jurisdiction, and has power and authority
necessary to own or hold its respective properties and to
conduct the businesses in which it is engaged.
(h) Except as described in each Prospectus, there is
no material litigation or governmental proceeding pending
or, to the knowledge of the Company, threatened against the
Company which might result in any material adverse change in
the financial condition, results of operations, business or
prospects of the Company or which is required to be
disclosed in the Registration Statement.
(i) The financial statements filed as part of the
Registration Statement or included in any Preliminary
Prospectus or Prospectus Supplement (or in the case of any
amendment or supplement to any such document, or any
material incorporated by reference in any such document,
filed with the Commission after the date as of which this
representation is being made), will present fairly, the
financial condition and results of operations of the
entities purported to be shown thereby, at the dates and for
the periods indicated, and have been, and (in the case of
any amendment or supplement to any such document, or any
material incorporated by reference in any such document,
filed with the Commission after the date as of which this
representation is being made) will be prepared in conformity
with generally accepted accounting principles applied on a
consistent basis throughout the periods involved.
(j) The documents incorporated by reference into any
Preliminary Prospectus or Prospectus have been and (in the case of
any amendment or supplement to any such document, or any
material incorporated by reference in any such document,
filed with the Commission after the date as of which this
representation is being made) will be at all times during
the period specified in Paragraph 6(c) hereof, prepared by
the Company in conformity with the applicable requirements
of the Act and the Rules and Regulations and the Exchange
Act and the rules and regulations of the Commission
thereunder and such documents have been or (in the case of
any amendment or supplement to any such document, or any
material incorporated by reference in any such document,
filed with the Commission after the date as of which this
representation is being made) will be at all times during
the period specified in Paragraph 6(c) hereof, timely filed
as required thereby.
(k) There are no contracts or other documents which
are required to be filed as exhibits to the Registration
Statement by the Act or by the Rules and Regulations, or
which were required to be filed as exhibits to any document
incorporated by reference in any Prospectus by the Exchange
Act or the rules and regulations of the Commission
thereunder, which have not been filed as exhibits to the
Registration Statement or to such document incorporated
therein by reference as permitted by the Rules and
Regulations or the rules and regulations of the Commission
under the Exchange Act as required.
(l) The Indiana Utility Regulatory Commission has
issued an appropriate order with respect to the issue and
sale of the New Preferred Stock; such order is sufficient
for the issue and sale of the New Preferred Stock; the terms
of this Agreement with respect to the issue and sale of the
New Preferred Stock are in conformity with the terms of such
order; and no other approval or consent of any governmental
body (other than in connection or in compliance with the
provisions of the securities or "blue sky" laws of any
jurisdiction) is legally required for the issue and sale of
the New Preferred Stock by the Company or the carrying out
of the provisions of this Agreement.
2. The obligation of the Underwriters to purchase, and
the Company to sell, the New Preferred Stock is evidenced by a
Terms Agreement delivered at the time the Company determines to
sell the New Preferred Stock. The Terms Agreement specifies the
firm or firms which will be Underwriters, the number of shares of
the New Preferred Stock to be purchased by each Underwriter, the
purchase price to be paid by the Underwriters for the New
Preferred Stock, the public offering price, if any, of the New
Preferred Stock and any terms of the New Preferred Stock not
already specified herein (including, but not limited to,
designations, dividend rates, payment dates and redemption
provisions). The Terms Agreement specifies any details of the
terms of the offering which should be reflected in a
post-effective amendment to the Registration Statement or the
supplement to the Prospectus relating to the offering of the New
Preferred Stock.
3. The Company shall not be obligated to deliver any
New Preferred Stock except upon payment for all New Preferred
Stock to be purchased pursuant to this Agreement as hereinafter
provided.
4. If any one or more of the Underwriters defaults in
the performance of its obligations under this Agreement, the
remaining non-defaulting Underwriter or Underwriters or such
other underwriters satisfactory to the non-defaulting
Underwriters and the Company who so agree, shall have the right,
but shall not be obligated to, purchase in such proportion as may
be agreed upon among them, the shares of New Preferred Stock
which the defaulting Underwriter or Underwriters failed to
purchase. If the non-defaulting Underwriter or Underwriters or
other underwriters satisfactory to the non-defaulting
Underwriters and the Company do not elect to purchase the New
Preferred Stock which the defaulting Underwriter or Underwriters
agreed but failed to purchase, this Agreement shall terminate
without liability on the part of any non-defaulting Underwriter
or the Company, except that the Company will continue to be
liable for the payment of expenses as set forth in Paragraphs
6(j) and 10 hereof.
Nothing contained in this Paragraph 4 shall relieve a
defaulting Underwriter of any liability it may have to the
Company for damages caused by its default. If other underwriters
are obligated or agree to purchase the New Preferred Stock of the
defaulting or withdrawing Underwriter, either the non-defaulting
Underwriters or the Company may postpone the Delivery Date for up
to seven full business days in order to effect any changes that
in the opinion of counsel for the Company or counsel for the
Underwriters may be necessary in the Registration Statement, any
Prospectus or in any other document or arrangement.
5. Delivery of any payment for the New Preferred Stock
shall be made at the office of Dillon, Read & Co. Inc., upon or
before the seventh business day following the Date of the Terms
Agreement, or at such other location, time and date as shall be
agreed upon. This date and time are sometimes referred to as the
"Delivery Date." On the Delivery Date the Company shall deliver
the New Preferred Stock to the Underwriters for the account of
each Underwriter against payment to or upon the order of the
Company of the purchase price by certified or official bank check
or checks payable in New York Clearing House funds or in
immediately available funds, as shall be provided in the Terms
Agreement. Time shall be of the essence, and delivery at the
time and place specified pursuant to this Agreement is a further
condition of the obligation of each Underwriter hereunder. Upon
delivery, the New Preferred Stock shall be in definitive fully
registered form and in such denominations and registered in such
names, as the Underwriters shall request in writing not less than
three full business days prior to the Delivery Date. For the
purpose of expediting the checking and packaging of the shares of
New Preferred Stock the Company shall make the New Preferred
Stock available for inspection by the Representatives in New
York, New York not later than 2:00 P.M., New York City Time, on
the business day prior to the Delivery Date.
6. The Company agrees:
(a) To furnish promptly to the Underwriters and to
counsel for the Underwriters a conformed copy of the
Registration Statement as filed pursuant to Rule 901(d) of
Regulation S-T and each amendment or supplement thereto
filed prior to the date of the Terms Agreement or relating
to or covering the New Preferred Stock, and a copy of each
Prospectus filed with the Commission, including all
documents incorporated therein by reference and all consents
and exhibits filed therewith;
(b) To deliver promptly to the Underwriters such
number of the following documents as the Underwriters may
request: (i) conformed copies of the Registration Statement
(excluding exhibits other than this Agreement), (ii) the
computation of the ratio of earnings to fixed charges and
preferred stock dividends, (iii) each Prospectus, and (iv)
any documents incorporated by reference in any Prospectus.
(c) To file with the Commission, during such period
following the date of the Terms Agreement as, in the opinion
of counsel for the Underwriters, any Prospectus is required
by law to be delivered, any amendment or supplement to the
Registration Statement or any Prospectus that may, in the
judgment of the Company or the Underwriters, be required by
the Act or requested by the Commission and approved by the
Underwriters;
(d) Prior to filing with the Commission during the
period referred to in (c) above (i) any amendment or
supplement to the Registration Statement, (ii) any
Prospectus or any amendment or supplement thereto or (iii)
any document incorporated by reference in any of the
foregoing or any amendment or supplement to any such
incorporated document, to furnish a copy thereof to the
Underwriters and to counsel for the Underwriters and obtain
the consent of the Underwriters to the filing;
(e) To advise the Underwriters promptly (i) when any
post-effective amendment to the Registration Statement
relating to or covering the New Preferred Stock becomes
effective, (ii) of any request or proposed request by the
Commission for an amendment or supplement to the
Registration Statement (insofar as the amendment or
supplement relates to or covers the New Preferred Stock), to
any Prospectus, to any document incorporated by reference in
any of the foregoing or for any additional information,
(iii) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement
or any order directed to any Prospectus or any document
incorporated therein by reference or the initiation or
threat of any stop order proceeding or of any challenge to
the accuracy or adequacy of any document incorporated by
reference in any Prospectus, (iv) of receipt by the Company
of any notification with respect to the suspension of the
qualification of the New Preferred Stock for sale in any
jurisdiction or the initiation or threat of any proceeding
for that purpose and (v) of the happening of any event which
makes untrue any statement of a material fact made in the
Registration Statement (insofar as the Registration
Statement relates to or covers the New Preferred Stock) or
any Prospectus or which requires the making of a change in
the Registration Statement or any Prospectus in order to
make any material statement therein not misleading;
(f) If, during the period referred to in (c) above,
the Commission shall issue a stop order suspending the
effectiveness of the Registration Statement, to make every
reasonable effort to obtain the lifting of that order at the
earliest possible time;
(g) To make generally available to its security
holders and to deliver to the Underwriters an earnings
statement, conforming with the requirements of Section 11(a)
of the Act, covering a period of at least twelve months
beginning after the effective date of the Registration
Statement;
(h) So long as any of the New Preferred Stock are
outstanding, to furnish to the Underwriters copies of all
public reports and all reports and financial statements
furnished by the Company to the New York Stock Exchange
pursuant to requirements of or agreements with such exchange
or to the Commission pursuant to the Exchange Act or any
rule or regulation of the Commission thereunder (except for
Form TA-1 filed pursuant to Rule 17Ac2-1 under the Exchange
Act and Form TA-2 filed pursuant to Section 17A of the
Exchange Act);
(i) To endeavor to qualify the New Preferred Stock for
offer and sale under the securities laws of such
jurisdictions as the Underwriters may reasonably request;
(j) To pay the costs incident to the authorization,
issuance, sale and delivery of the New Preferred Stock and
any taxes payable in that connection; the costs incident to
the preparation, printing and filing under the Act of the
Registration Statement and any amendments, supplements and
exhibits thereto; the costs incident to the preparation,
printing and filing of any document and any amendments and
exhibits thereto required to be filed by the Company under
the Exchange Act; the costs of distributing the Registration
Statement as originally filed and each amendment and
post-effective amendment thereof (including exhibits), any
Preliminary Prospectus, each Prospectus and any documents
incorporated by reference in any of the foregoing documents;
the costs of printing this Agreement, if any; the costs of
filings with the National Association of Securities Dealers,
Inc.; fees paid to rating agencies in connection with the
rating of the New Preferred Stock; the fees and expenses of
qualifying the New Preferred Stock under the securities laws
of the several jurisdictions as provided in this Paragraph
and of preparing and printing Blue Sky and Legality
Memoranda (including fees of counsel to the Underwriters);
and all other costs and expenses incident to the performance
of the Company's obligations under this Agreement; provided
that, except as provided in this Paragraph and in Paragraph
10 hereof, the Underwriters shall pay their own costs and
expenses, including the fees and expenses of their counsel,
any transfer taxes on the New Preferred Stock which they may
sell and the expenses of advertising any offering of the New
Preferred Stock made by the Underwriters; and
(k) Until the termination of the offering of the New
Preferred Stock, to timely file all documents, and any
amendments to previously filed documents, required to be
filed by the Company pursuant to Sections 13(a), 13(c), 14
or 15(d) of the Exchange Act.
7. (a) The Company shall indemnify and hold harmless
each Underwriter and each person, if any, who controls any
Underwriter within the meaning of the Act from and against any
loss, claim, damage or liability, joint or several, and any
action in respect thereof, to which that Underwriter or
controlling person may become subject, under the Act or
otherwise, insofar as such loss, claim, damage, liability or
action arises out of, or is based upon, (i) any untrue statement
or alleged untrue statement made by the Company under Section 1
hereof or (ii) any untrue statement or alleged untrue statement
of a material fact contained in any Preliminary Prospectus, the
Registration Statement or any Prospectus or in any blue sky
application or other document executed by the Company
specifically for that purpose or based upon written information
furnished by the Company (any such application, document or
information is hereinafter referred to as a "Blue Sky
Application") filed in any state or other jurisdiction in order
to qualify any or all of the New Preferred Stock under the
securities laws thereof, or arises out of, or is 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, and shall reimburse each Underwriter and
such controlling person for any legal and other expenses
reasonably incurred by that Underwriter or controlling person in
investigating or defending or preparing to defend against or
appearing as a third party witness in connection with any such
loss, claim, damage, liability or action; provided that the
Company shall not be liable in any such case to the extent that
any such loss, claim, damage, liability or action arises out of,
or is based upon, any untrue statement or alleged untrue
statement or omission or alleged omission made in any Preliminary
Prospectus, the Registration Statement, any Prospectus or any
Blue Sky Application in reliance upon and in conformity with
written information furnished to the Company through the
Underwriters by or on behalf of any Underwriter specifically for
inclusion therein; and provided further that as to any
Preliminary Prospectus this indemnity agreement shall not inure
to the benefit of any Underwriter or any person controlling that
Underwriter on account of any loss, claim, damage, liability or
action arising from the sale of New Preferred Stock to any person
by that Underwriter if that Underwriter failed to send or give a
copy of any Prospectus, as the same may be amended or
supplemented, to that person within the time required by the Act,
and the untrue statement or alleged untrue statement of a
material fact or omission or alleged omission to state a material
fact in such Preliminary Prospectus was corrected in such
Prospectus, unless such failure resulted from non-compliance by
the Company with Paragraph 6(b) hereof. For purposes of the
second proviso to the immediately preceding sentence, the term
Prospectus shall not be deemed to include the documents
incorporated therein by reference, and no Underwriter shall be
obligated to send or give any supplement or amendment to any
document incorporated by reference in any Preliminary Prospectus
or any Prospectus to any person other than a person to whom such
Underwriter has delivered such incorporated documents in response
to a written request therefor. The foregoing indemnity agreement
is in addition to any liability which the Company may otherwise have to
any Underwriter or controlling person.
(b) Each Underwriter, severally but not jointly, shall
indemnify and hold harmless the Company, each of its directors,
each of its officers who signed the Registration Statement and
any person who controls the Company within the meaning of the Act
from and against any loss, claim, damage or liability, joint or
several, and any action in respect thereof, to which the Company
or any such director, officer or controlling person may become
subject, under the Act or otherwise, insofar as such loss, claim,
damage, liability or action, arises out of, or is based upon, any
untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Prospectus, the Registration
Statement, any Prospectus or any Blue Sky Application, or arises
out of, or is 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, but in
each case only to the extent that the untrue statement or alleged
untrue statement or omission or alleged omission was made in
reliance upon and in conformity with written information
furnished to the Company through the Underwriters by or on behalf
of that Underwriter specifically for inclusion therein, and shall
reimburse the Company for any legal and other expenses reasonably
incurred by the Company or any such director, officer or
controlling person in investigating or defending or preparing to
defend against or appearing as a third-party witness in
connection with any such loss, claim, damage, liability or
action. The foregoing indemnity agreement is in addition to any
liability which any Underwriter may otherwise have to the Company
or any of its directors, officers or controlling persons.
(c) Promptly after receipt by an indemnified party
under this Paragraph of notice of any claim or the commencement
of any action, the indemnified party shall, if a claim in respect
thereof is to be made against the indemnifying party under this
Paragraph, notify the indemnifying party in writing of the claim
or the commencement of that action, provided that the failure to
notify the indemnifying party shall not relieve it from any
liability which it may have under this Section 7, except to the
extent it has been prejudiced in any material respect by such
failure, or from any liability which it may have to an
indemnified party otherwise than under this Paragraph. If any
such claim or action shall be brought against an indemnified
party, and it shall notify the indemnifying party thereof, the
indemnifying party shall be entitled to participate therein, and,
to the extent that it wishes, jointly with any other similarly
notified indemnifying party, to assume the defense thereof with
counsel satisfactory to the indemnified party. After notice from
the indemnifying party to the indemnified party of its election
to assume the defense of such claim or action, the indemnifying
party shall not be liable to the indemnified party under this
Paragraph for any legal or other expenses subsequently incurred
by the indemnified party in connection with the defense thereof
other than reasonable costs of investigation; provided that the
indemnified party shall have the right to employ one counsel to
represent it and its controlling persons in respect of any claim
in respect of which indemnity may be sought by it against the
indemnifying party under this Paragraph if, in the reasonable
judgment of the indemnified party, it is advisable for it and its
controlling persons to be represented by separate counsel, and in
that event the fees and expenses of such separate counsel shall
be paid by the indemnifying party.
(d) If the indemnification provided for in this
Paragraph 7 shall for any reason be unavailable to an indemnified
party under Paragraph 7(a) or 7(b) hereof in respect of any loss,
claim, damage or liability, or any action in respect thereof,
referred to therein, then each indemnifying party shall, in lieu
of indemnifying such indemnified party, contribute to the amount
paid or payable by such indemnified party as a result of such
loss, claim, damage or liability, or action in respect thereof,
(i) in such proportion as shall be appropriate to reflect the
relative benefits received by the Company on the one hand and the
Underwriters on the other from the offering of the New Preferred
Stock 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 the Underwriters on the other with respect to
the statements or omissions which resulted in such loss, claim,
damage or liability, or action in respect thereof, 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 with respect to such offering shall be deemed to be in
the same proportion as the total net proceeds from the offering
of the New Preferred Stock (before deducting expenses) received
by the Company bear to the total underwriting discounts and
commissions received by the Underwriters with respect to such
offering, in each case as set forth in the table on the cover
page of the Prospectus. The relative fault shall be determined
by reference to whether the untrue or alleged untrue statement of
a material fact or omission or alleged omission to state a
material fact relates to information supplied by the Company or
the Underwriters, the intent of the parties and their relative
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
contributions pursuant to this Paragraph 7(d) were to be
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 into account the equitable
considerations referred to herein. The amount paid or payable by
an indemnified party as a result of the loss, claim, damage or
liability, or action in respect thereof, referred to above in
this Paragraph 7(d) shall be deemed to include, for purposes of
this Paragraph 7(d), 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 Paragraph 7(d), no
Underwriter shall be required to contribute any amount in excess
of the amount by which the total price at which the New Preferred
Stock underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages which
such Underwriter has otherwise paid or become liable to pay by
reason of any 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
Act) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation. The
Underwriters' obligations to contribute as provided in this
Paragraph 7(d) are several in proportion to their respective
underwriting obligations and not joint.
(e) The indemnity agreements contained in this
Paragraph and the representations, warranties and agreements of
the Company in Paragraph 1 and Paragraph 6 hereof shall survive
the delivery of the New Preferred Stock and shall remain in full
force and effect, regardless of any termination or cancellation
of this Agreement or any investigation made by or on behalf of
any indemnified party.
8. The obligations of the Underwriters under this
Agreement may be terminated by the Underwriters obligated to
purchase a majority of the New Preferred Stock, in their absolute
discretion, by notice given to and received by the Company prior
to the delivery of and payment for the New Preferred Stock, if,
during the period beginning on the date of the Terms Agreement to
and including the Delivery Date, (a) trading in securities
generally on the New York Stock Exchange, Inc., the American
Stock Exchange or the over-the-counter market is suspended, or
minimum prices are established on that Exchange, (b) a banking
moratorium is declared by either Federal or New York State
authorities (c) the United States becomes engaged in material
hostilities or there is a material escalation in hostilities
involving the United States or there is a declaration of a
national emergency or war by the United States, or (d) there
shall have been such a material and substantial change in
economic, political or financial conditions or the effect of
international conditions on the financial markets in the United
States shall be so material and substantial, such as, in the
reasonable judgment of the Underwriters obligated to purchase a
majority of the New Preferred Stock, makes it impractical or
imprudent to proceed with the payment for and the delivery of the
New Preferred Stock.
9. The respective obligations of the Underwriters
under the Agreement with respect to the New Preferred Stock are
subject to the accuracy, on the date of the Terms Agreement and
on the Delivery Date, of the representations and warranties of
the Company contained herein, to performance by the Company of
its obligations hereunder, and to each of the following
additional terms and conditions applicable to the New Preferred
Stock:
(a) At or before the Delivery Date, no stop order
suspending the effectiveness of the Registration Statement
nor any order directed to any document incorporated by
reference in any Prospectus shall have been issued and prior
to that time no stop order proceeding shall have been
initiated or threatened by the Commission and no challenge
shall have been made to the accuracy or adequacy of any
document incorporated by reference in any Prospectus; any
request of the Commission for inclusion of additional
information in the Registration Statement or any Prospectus
or otherwise shall have been complied with; and after the
date of the Terms Agreement the Company shall not have filed
with the Commission any amendment or supplement to the
Registration Statement or any Prospectus (or any document
incorporated by reference therein) without the consent of
the Underwriters.
(b) No Underwriter shall have discovered and disclosed
to the Company on or prior to the Delivery Date that the
Registration Statement or any Prospectus contains an untrue
statement of a fact which, in the opinion of counsel for the
Underwriters, is material or omits to state a fact which, in
the opinion of such counsel, is material and is required to
be stated therein or is necessary to make the statements
therein not misleading.
(c) All corporate proceedings and other legal matters
incident to the authorization, form and validity of this
Agreement and the New Preferred Stock and the form of the
Registration Statement, each Prospectus (other than
financial statements and other financial data) and all other
legal matters relating to this Agreement and the
transactions contemplated hereby shall be satisfactory in
all respects to Simpson Thacher & Bartlett, counsel for the
Underwriters, and the Company shall have furnished to such
counsel all documents and information that they may
reasonably request to enable them to pass upon such matters.
(d) Marcus E. Woods, Vice President, Secretary and
General Counsel of the Company, shall have furnished to the
Underwriters his opinion addressed to the Underwriters and
dated the Delivery Date, as general counsel of the Company,
to the effect that:
(i) The Company is a duly organized and
validly existing public utility corporation under
the laws of the State of Indiana, has full
corporate authority to engage in the business in
which it is engaged in as stated in the
Registration Statement and each Prospectus, has
full corporate power and authority to issue and
sell the New Preferred Stock, and is subject to
regulation by the Indiana Utility Regulatory
Commission in matters pertaining, among other
things, to the issue and sale of the New Preferred
Stock. The terms Registration Statement and each
Prospectus, as used herein, have the same meanings
as in Paragraph l(a) of this Agreement;
(ii) The shares of New Preferred Stock
have been duly authorized and issued and are fully
paid and nonassessable and have the rights set
forth in the Amended Articles of Incorporation, as
amended, of the Company; the certificates for the
New Preferred Stock are in due and proper form;
the holders of outstanding shares of capital stock
of the Company are not entitled to preemptive or
other rights to subscribe for the New Preferred
Stock;
(iii) The Indiana Utility Regulatory
Commission has issued an appropriate order under date
of December 1, 1993 in Cause No. 39816, with respect to
the issue and sale of the New Preferred Stock; such
order is sufficient for such purpose; the issue and
sale of the New Preferred Stock is in conformity with
the terms of such order, and no other authorization,
approval or consent of any governmental body is legally
required for the issue and sale of the New Preferred
Stock by the Company, or for the carrying out of the
provisions of this Agreement (other than in connection
or in compliance with the provisions of the securities
or "blue sky" laws of any jurisdiction);
(iv) The New Preferred Stock conform, as
to legal matters, to the statements concerning
them contained or incorporated by reference in the
Registration Statement and each Prospectus
referred to herein, filed by the Company with the
Commission;
(v) The Registration is effective under
the Act, no stop order suspending its
effectiveness has been issued, and, to the
knowledge of such counsel, no proceeding for that
purpose is pending or threatened by the
Commission;
(vi) No order directed to any document
incorporated by reference in any Prospectus has
been issued and to the knowledge to such counsel,
no challenge has been made to the accuracy or
adequacy of any such document;
(vii) The Registration Statement and each
Prospectus (except that no opinion need be
expressed as to the financial statements contained
therein), comply as to form in all material
respects with the relevant requirements of the Act
and the Rules and Regulations and the documents
incorporated or deemed to be incorporated by
reference in the Prospectus (except that no
opinion need be expressed as to the financial
statements and other financial data contained
therein) comply as to form in all material
respects with the requirements of the Exchange Act
and the rules and regulations thereunder, and such
counsel has no reason to believe that the
Registration Statement or any prospectus contains
any untrue statements of a material fact or omits
to state a material fact required to be stated
therein or necessary to make the statements
therein not misleading;
(viii) The statements made in the
Prospectus under the caption "Description of the
New Preferred Stock" insofar as they purport to
summarize the provisions of documents or
arrangements specifically referred to therein
present the information called for with respect
thereto by Form S-3;
(ix) Such counsel does not know of any
contracts or other documents which are required to
be filed as exhibits to the Registration Statement
by the Act or by the rules and regulations
thereunder or which are required to be filed by
the Exchange Act or the rules and regulations
thereunder as exhibits to any documents
incorporated by reference in any Prospectus, which
have not been filed as exhibits to the
Registration Statement or to such documents
incorporated therein by reference permitted by the
rules and regulations or the rules and regulations
of the Commission under the Exchange Act;
(x) The Company holds valid
indeterminate permits from the State of Indiana
authorizing it to carry on its utility business in
the city of Indianapolis, Indiana, and adjacent
areas, from which more than 98% of its operating
revenues, excluding sales to other electric
utilities, are derived;
(xi) Since the end of its latest fiscal
year, the Company has timely filed all documents
and amendments to previously filed documents
required to be filed by it pursuant to Sections
12, 13, 14 or 15(d) of the Exchange Act;
(xii) Such counsel does not know of any
litigation or any governmental proceeding
instituted or threatened against the Company of a
character referred to in Paragraph 1(h) above
other than as disclosed in the Prospectus or in
any document incorporated, or deemed to be
incorporated, by reference in the Prospectus; and
(xiii) This Agreement has been duly
authorized, executed and delivered by the Company,
and the provisions thereof do not conflict with or
result in a breach of the Amended Articles of
Incorporation, as amended, of the Company, or of
any of the terms, conditions or provisions of any
outstanding agreements, notes or other instruments
under which the Company is obligated.
(e) The Company shall have furnished to the
Underwriters on the Delivery Date a certificate, dated the
Delivery Date, of its Chairman of the Board, its President
or a Vice President and its Treasurer stating that:
(i) The representations, warranties and
agreements of the Company in Paragraph 1 hereof
are true and correct as of the Delivery Date; the
Company has complied with all its agreements
contained herein; and the conditions set forth in
Paragraph 9(a) hereof have been fulfilled;
(ii) They have carefully examined the
Registration Statement and each Prospectus and, in
their opinion, (A) as of the date of each
Prospectus, the Registration Statement and the
Prospectus did not include any untrue statement of
a material fact and did not omit to state a
material fact required to be stated therein or
necessary to make the statements therein not
misleading, and (B) since the date of each
Prospectus, no event has occurred which should
have been set forth in a supplement to or
amendment of each Prospectus which has not been
set forth in such a supplement or amendment.
(f) The Company shall have furnished to the
Underwriters on the Delivery Date a letter of Deloitte &
Touche, addressed to the Underwriters and dated the Delivery
Date, of the type described in the American Institute of
Certified Public Accountants' Statement on Auditing
Standards No. 72 and covering such specified financial
statement items as the Underwriters may reasonably request.
All opinions, letters, evidence and certificates mentioned above
or elsewhere in this Agreement shall be deemed to be in
compliance with the provisions hereof only if they are in form
and substance satisfactory to counsel for the Underwriters.
10. If the Company shall fail to tender the New
Preferred Stock for delivery to the Underwriters for any reason
permitted under this Agreement, or if the Underwriters shall
decline to purchase the New Preferred Stock for any reason
permitted under this Agreement, the Company shall reimburse the
Underwriters for the reasonable fees and expenses of their
counsel and for such other out-of-pocket expenses as shall have
been incurred by them in connection with this Agreement and the
proposed purchase of the New Preferred Stock, and upon demand the
Company shall pay the full amount thereof to the Underwriters.
If this Agreement is terminated pursuant to Paragraph 4 hereof by
reason of the default of one or more Underwriters, the Company
shall not be obligated to reimburse any defaulting Underwriter on
account of those expenses.
11. The Company shall be entitled to act and rely upon
any request, consent, notice or agreement by Dillon, Read & Co.
Inc. on behalf of the Underwriters. Any notice by the Company to
the Underwriters shall be sufficient if given in writing or by
telegraph addressed to Dillon, Read & Co. Inc., on behalf of the
Underwriters, at 2001 Ross Avenue, Suite 3950, Dallas, Texas
75201, Attention: Kenneth S. Crews. Any notice by the
Underwriters to the Company shall be sufficient if given in
writing or by telegraph addressed to the Company at 25 Monument
Circle, P.O. Box 1595, Indianapolis, Indiana 46206-1595,
Attention of the Senior Vice President, Finance and Information
Services.
12. This Agreement shall be binding upon the
Underwriters, the Company, and their respective successors. This
Agreement and the terms and provisions hereof are for the sole
benefit of only those persons, except that (a) the
representations, warranties, indemnities and agreements of the
Company contained in this Agreement shall also be deemed to be
for the benefit of the person or persons, if any, who control any
Underwriter within the meaning of Section 15 of the Act, and (b)
the indemnity agreement of the Underwriters contained in
Paragraph 7 hereof shall be deemed to be for the benefit of
directors of the Company, officers of the Company who have signed
the Registration Statement and any person controlling the
Company. Nothing in this Agreement is intended or shall be
construed to give any person, other than the persons referred to
in this Paragraph, any legal or equitable right, remedy or claim
under or in respect of this Agreement or any provision contained
herein.
13. For purposes of this Agreement, "business day"
means any day on which the New York Stock Exchange, Inc. is open
for trading.
14. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
15. The Terms Agreement may be executed in one or more
counterparts, and if executed in more than one counterpart the
executed counterparts shall together constitute a single
instrument.