Exhibit 1-B
to Form S-3
UNDERWRITING AGREEMENT
FOR PURCHASE OF $__________
FIRST MORTGAGE BONDS, SERIES ___,
_____%, DUE __________
OF
MASSACHUSETTS ELECTRIC COMPANY
Date:
Massachusetts Electric Company
25 Research Drive
Westborough, MA 01582
Ladies and Gentlemen:
We (the Underwriters) understand that Massachusetts Electric
Company, (the Company), proposes to issue and sell $__________
aggregate principal amount of First Mortgage Bonds, Series ___,
_____%, due __________, (with Original Issue Date as defined in
the Terms of Purchase) (the Bonds).
Subject to the terms and conditions set forth in the Terms of
Purchase annexed hereto, the Company hereby agrees to sell all of
the Bonds, and each of the Underwriters agrees, severally and not
jointly, to purchase the respective principal amount of the Bonds
set forth opposite its name below, in each case at a purchase
price of _____% of the principal amount of such Bonds.
Principal
Name Amount of Bonds
____ _______________
____________________
Total $
The Underwriters will pay for such Bonds upon delivery
thereof in accordance with the Terms of Purchase.
The Bonds shall have the terms set forth in the Prospectus
dated _______________, and the Prospectus Supplement dated
_______________, including the following:
Maturity:
Interest Rate:
Redemption Provisions:
Interest Payment Dates:
Form and Denomination:
Other:
All provisions contained in the document entitled "TERMS OF
PURCHASE RELATING TO FIRST MORTGAGE BONDS, SERIES *, **%, DUE *
(ORIGINAL ISSUE DATE ***) OF MASSACHUSETTS ELECTRIC COMPANY", a
copy of which is attached hereto, are herein incorporated by
reference in their entirety and shall be deemed to be a part of
this agreement to the same extent as if such provisions had been
set forth in full herein.
Please confirm your agreement by having an authorized officer
sign a copy of this agreement in the space set forth below and
returning the signed copy to us at the address below.
Very truly yours,
[Name of Underwriter or Representative]
By______________________________________
Name:
Title:
Address:
Accepted:
MASSACHUSETTS ELECTRIC COMPANY
By_________________________________
Name:
Title:
TERMS OF PURCHASE
RELATING TO
FIRST MORTGAGE BONDS, SERIES *, **%, DUE *
(ORIGINAL ISSUE DATE ***)
OF
MASSACHUSETTS ELECTRIC COMPANY
TERMS OF PURCHASE between Massachusetts Electric Company (the
Company), a Massachusetts corporation, and the several
Underwriters named in a confirmation letter (the Confirmation) to
which these Terms of Purchase are attached and hereinafter
collectively called the Underwriting Agreement. (The words
"herein" and "hereunder", unless specifically limited, mean "in
the Underwriting Agreement" and "under the Underwriting
Agreement", respectively.)
1. UNDERWRITERS AND REPRESENTATIVE. The term Underwriters
as used herein shall mean the several persons, firms, or
corporations named in the Confirmation (including the
Representative hereinafter mentioned); and the term
Representative as used herein shall be deemed to mean the
representative or representatives designated as Representative
by, or in the manner authorized by, the Underwriters and who, by
signing the Confirmation, represent that it or they have been
authorized by the Underwriters to enter into this Underwriting
Agreement on their behalf and to act for them in the manner
herein provided. If there shall be only one person, firm, or
corporation named in said Confirmation, the term Underwriters and
the term Representative as used herein shall mean such person,
firm, or corporation.
2. DESCRIPTION OF THE BONDS. The Company proposes to issue
and sell $* principal amount of its First Mortgage Bonds,
Series *, **%, due * (Original Issue Date ***) (the Bonds), to be
issued under an indenture supplemental to the First Mortgage
Indenture and Deed of Trust dated as of July 1, 1949, (as
heretofore and hereafter supplemented, the Indenture), from the
Company to State Street Bank and Trust Company (the Trustee),
______________________
* The series designation, aggregate principal amount, and the
year in which the Bonds mature are as specified in the
Confirmation.
** The percentage is the interest rate specified in the
Confirmation.
*** Original Issue Date shall be the Closing Date.
formerly Second Bank-State Street Trust Company, successor to The
Second National Bank of Boston. The terms and provisions of the
Bonds and of the Indenture are summarized in the registration
statement and in the prospectus below mentioned.
3. PUBLIC OFFERING. The Company is advised by the
Representative that the Underwriters propose to make a public
offering of their respective portions of the Bonds as soon after
this Agreement is entered into as in the Representative's
judgment is advisable. The terms of the public offering of the
Bonds are set forth in the prospectus below mentioned.
4. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The
Company represents and warrants to each Underwriter as follows:
(a) With respect to the proposed issue and sale of the
Bonds, the Company has filed a registration statement,
including as a part thereof a prospectus, under the
Securities Act of 1933, as amended (the Securities Act), with
the Securities and Exchange Commission (the Commission).
Said registration statement has become effective, and the
prospectus in the registration statement as now effective
(the Registration Statement) meets the requirements of
section 10(a) of the Securities Act. The Company will file a
supplement to the prospectus (the Supplement) with respect to
the Bonds to reflect the results of the pricing set forth in
the Confirmation pursuant to the rules and regulations under
the Securities Act, after giving the Representative an
opportunity to examine and make objections of substance to
the Supplement. Such examination shall not limit or affect
the rights of any Underwriter in respect of any
representation, warranty, or covenant of indemnity by the
Company herein contained. Before filing any other supplement
or amendment to the Registration Statement or the Supplement
with respect to the Bonds, the Company will afford the
Representative an opportunity to examine it and any documents
incorporated therein and to make objections of substance
thereto. The Representative shall have the right to
terminate this Underwriting Agreement, without liability on
the part of any Underwriter, if the Company shall file the
Supplement or any other supplement or amendment to the
prospectus to which the Representative shall reasonably so
object in writing.
(b) Said prospectus and the Registration Statement have
been, and the Supplement and each other supplement or
amendment thereto will be, carefully prepared in conformity
with the requirements of the Securities Act and the rules,
regulations, and releases of the Commission thereunder; the
Registration Statement contains all statements which are
required to be incorporated or stated therein in accordance
with the Securities Act and the rules, regulations, and
releases thereunder, and will in all material respects
conform to the requirements thereof; said prospectus, as
supplemented when the Supplement is filed (the Prospectus),
will contain or incorporate therein all statements made in
the Registration Statement which the Prospectus is required
to contain and will in all material respects conform to the
requirements of the Securities Act and the rules,
regulations, and releases thereunder; wherever the terms
prospectus, Prospectus, registration statement, or
Registration Statement are used herein, they shall be deemed
to include all documents incorporated by reference therein
pursuant to the requirements of Form S-3 under the Securities
Act, and such documents incorporated or to be incorporated by
reference therein have been or will be prepared and filed
with the Commission in a timely manner and in accordance with
the provisions of the Securities Exchange Act of 1934 (the
Exchange Act) and applicable rules, regulations, and releases
thereunder; neither the Registration Statement nor the
Prospectus will include any untrue statement of a material
fact or omit to state a material fact which (in the case of
the Registration Statement) is required to be incorporated or
stated therein or is necessary to make the statements therein
or incorporated therein not misleading or which (in the case
of the Prospectus) is necessary to make the statements
therein, in the light of the circumstances under which they
are made, not misleading; provided, however, that the
foregoing representations and warranties shall not apply to
statements or omissions made in reliance on written
information furnished to the Company by the Underwriter, or
by and through the Representative on behalf of any
Underwriter, or to statements or omissions in the Statement
of Eligibility and Qualification of the Trustee under the
Indenture.
(c) The financial statements of the Company included or
incorporated by reference in the Registration Statement will
be correct and complete and will truly present the financial
position of the Company as at the dates stated therein and
the results of the operations of the Company for the periods
stated therein. The Company had, on the date of the latest
financial statements included or incorporated by reference in
the Registration Statement, no material liabilities or
obligations, fixed or contingent, other than those disclosed
in the Registration Statement or such financial statements,
and since that date the Company has not incurred any material
liabilities or obligations still outstanding, fixed or
contingent, other than (i) in the ordinary course of
business, (ii) as a result of transactions described in the
prospectus included in the Registration Statement, or (iii)
short-term borrowings which result in short-term note
indebtedness of not exceeding, in the aggregate at any one
time outstanding, the limitations then authorized for the
Company by the Commission under the Public Utility Holding
Company Act of 1935 (the 1935 Act). Since the date of the
latest financial statements included or incorporated by
reference in the Registration Statement, there has not been
any material adverse change in the financial condition of the
Company not disclosed in the prospectus included in the
Registration Statement. Except as described in said
prospectus, there are no proceedings at law or in equity or
before any federal or state commission or other public
authority the result of which might have a material adverse
effect upon the financial condition of the Company.
(d) Coopers & Lybrand L. L. P., who have certified
certain of the financial statements filed with the
Commission, are independent certified public accountants as
required by the Securities Act and the rules, regulations,
and releases thereunder.
(e) The consummation of the transactions herein
contemplated and the performance by the Company of the terms
of this Underwriting Agreement will not violate any of the
terms, conditions, or provisions of, or constitute a default
under, any franchise, indenture, or other contract or
agreement to which the Company is now a party or by which the
Company or its property may be bound or affected, or the
Company's charter, by-laws, or preferred stock provisions, or
any order of any court or administrative agency by which the
Company is bound.
(f) The issue and sale of the Bonds are solely for the
purpose of financing the business of the Company.
5. INFORMATION FROM AND WARRANTIES OF THE UNDERWRITERS.
Each Underwriter, in addition to other information furnished to
the Company for use in the Prospectus, is contemporaneously
furnishing and will continue to furnish to the Company through
the Representative for use in the Prospectus the information to
be stated therein with regard to the public offering to be made
by the Underwriters, any further information regarding the
Underwriters and such public offering which may be required under
the 1935 Act, and all other information required by law in
respect of the purchase and sale of the Bonds. Each Underwriter
warrants and represents to the Company, each of the officers and
directors of the Company, each person, if any, who controls the
Company within the meaning of Section 15 of the Securities Act,
and each other Underwriter that all information furnished at any
time in writing to the Company by such Underwriter, or by or
through the Representative on behalf of such Underwriter, for use
in the Prospectus, will not contain an untrue statement of a
material fact and will not omit to state any material fact which
is necessary to make the statements therein, in the light of the
circumstances under which they are made, not misleading.
6. PURCHASE AND SALE OF BONDS. The Company will sell to
each Underwriter and each Underwriter will severally purchase
from the Company, at the price specified in the Confirmation, at
the time and place, in the manner, and upon the terms and
conditions hereinafter set forth, the principal amount of Bonds
set forth opposite its name in the Confirmation, which amount may
be increased in accordance with paragraph (a) of Section 13
hereof.
All obligations of the Underwriters hereunder are several,
and not joint or joint and several, and nothing herein shall
constitute the Underwriters copartners of each other.
7. TIME AND PLACE OF CLOSING; DELIVERY AND PAYMENT. The
term Closing Date wherever used herein shall mean the eighth day
(or if such day is not a full business day, the next full
business day thereafter) following the date hereof, or such other
date as shall be agreed in writing by the Company and the
Representative (subject to postponement in accordance with the
provisions of Section 13 hereof).
Payment for the Bonds, as provided in Section 6 hereof, shall
be made at the principal office of State Street Bank and Trust
Company, Boston, Massachusetts, at 10 a.m., Boston time, on the
Closing Date. Payment shall be made to the Company or its order
in immediately available current-day funds by certified check or
checks drawn on, or by official check or checks of, State Street
Bank and Trust Company, or in Boston Federal Reserve Bank Funds.
Payment for the Bonds may also be made by a FedWire electronic
funds transfer to Massachusetts Electric Company's General Funds
Account, Number 514-22952, at Bank of Boston, Boston,
Massachusetts. Such payment shall be made upon delivery of the
Bonds to the Representative for the respective accounts of the
Underwriters, such delivery to be made at the offices of State
Street Bank and Trust Company, N.A., 61 Broadway, New York, New
York 10006. The Bonds will be delivered, at the option of the
Company, either in temporary or definitive form. If delivered in
temporary form, each will be in the denomination of $1,000, and
an exchange of temporary Bonds for fully-registered Bonds in
definitive form will be made as soon as practicable and without
charge to the holders thereof. If delivered in definitive form,
the Bonds will be in fully-registered form and will be registered
in such name or names and in such denominations of $1,000 or
integral multiples thereof as the Representative may request not
later than 10 a.m., Boston time, on the third full business day
prior to the Closing Date. If no such direction is received, the
Bonds will be registered in the names of the respective
Underwriters in denominations selected by the Company.
The Company will make such Bonds available to the
Representative for examination at the place of delivery, not
later than 2 p.m., Boston time, on the first full business day
prior to the Closing Date.
The Representative, individually and not as the
Representative, may (but shall not be obligated to) make payment
to the Company for the Bonds to be purchased by any Underwriter
whose funds shall not have been received by the Representative as
of the Closing Date, for the account of such Underwriter. Any
such payment by the Representative shall not relieve such
Underwriter from any of its obligations hereunder, but the
Representative shall succeed to the right of the Company to
receive the amount of such payment from such Underwriter.
8. COVENANTS OF THE COMPANY. The Company agrees that:
(a) The Company will promptly deliver to the
Representative a certified copy of the registration statement
with respect to the Bonds, as originally filed, and of all
amendments thereto heretofore or hereafter made, including a
copy of each consent and certificate included or incorporated
by reference therein or filed as an exhibit thereto (but
excluding any other exhibit thereto unless specifically
requested by the Representative). The Company will deliver
to the Representative in New York or Boston, as requested, as
soon as practicable after the filing of the Supplement, and
thereafter from time to time during the nine-month period
commencing on the date hereof, as many unsigned copies of the
Prospectus (as supplemented or amended, if the Company shall
have made any supplements or amendments thereto) and any
documents incorporated by reference therein as the
Representative may reasonably request for purposes
contemplated by the Securities Act.
(b) The Company will advise the Representative
immediately by telegraph or other means of communication and
confirm the advice in writing:
(i) when the Supplement has been filed;
(ii) of the issuance by the Commission of any
stop order suspending the effectiveness of the
Registration Statement, or of the initiation of any
proceedings for that purpose, and agrees, if any such
stop order should be entered by the Commission, to make
every reasonable effort to obtain the lifting or removal
thereof as soon as possible;
(iii) of the issuance by the Massachusetts
Department of Public Utilities (MDPU) of any order
altering, suspending, supplementing, or otherwise
affecting its order permitting the issuance and sale of
the Bonds;
(iv) of any action by the Commission which has
the effect of eliminating the exemption from the
requirements of the Public Utility Holding Company Act
of 1935 provided under Rule 52 promulgated thereunder;
and
(v) of the commencement of any litigation in
connection with the Bonds against the Company or any of
its directors or any signer of the Registration
Statement.
(c) During the six-month period commencing on the
effective date of this Underwriting Agreement, the Company
will use its best efforts, when and as requested by the
Representative, to furnish information and otherwise
cooperate in qualifying the Bonds for the purposes of any
public offering by the Underwriters under securities or
"blue-sky" laws of such states as the Representative may
designate; provided that the Company shall not be obligated
to qualify as a foreign corporation in, or consent to service
of process under the laws of, any state, or to meet other
requirements deemed by it to be unduly burdensome. The
Company will pay or reimburse the Representative in an
aggregate amount not exceeding $3,000 for the filing fees and
expenses in connection with any qualification referred to in
this paragraph.
(d) The Company will pay all expenses in connection with
(i) the preparation and filing by it of the Registration
Statement and the Prospectus and any supplement or amendment
thereto, (ii) the issue and delivery of the Bonds, and (iii)
the printing of the Prospectus and any supplement or
amendment thereto and the delivery of reasonable quantities
of copies thereof to Underwriters. The Company will pay all
federal and state taxes (except transfer taxes) on the issue
of the Bonds. The Company shall not, however, be required to
pay any amount for the expenses of the Representative or of
any Underwriters, except as provided in paragraphs (c) and
(e) of this Section. The fees and disbursements of Milbank,
Tweed, Hadley & McCloy (the Underwriters' Counsel) shall be
paid by the Underwriters, except as provided in paragraph (e)
of this Section; and in the event that the fees of
Underwriters' Counsel shall be reduced from the amount stated
by such counsel to the Representative, an amount equal to
such reduction shall be paid to the Company by or on behalf
of the Underwriters.
(e) If the Underwriting Agreement shall be terminated
pursuant to any of the provisions hereof, the Company will
pay the reasonable fees and disbursements of Underwriters'
Counsel and the filing fees and expenses referred to in
paragraph (c) of this Section. If the Underwriters shall not
take up and pay for the Bonds due to the failure of the
Company to comply with any of the conditions specified in
Section 9 hereof, the Company will reimburse the Underwriters
in an aggregate amount not exceeding $2,000 for their
reasonable out-of-pocket expenses incurred in connection with
the financing contemplated by this Underwriting Agreement.
The Company shall not in any event be liable to any of the
Underwriters for damages on account of loss of anticipated
profits.
(f) During the nine-month period commencing on the date
hereof, if any event known to the Company or of which the
Company shall be advised by the Representative shall occur
which should be set forth in a supplement to or an amendment
of the Prospectus or in any document to be incorporated by
reference therein in order to make the Prospectus not
misleading in the light of the circumstances existing at the
time it is delivered to a purchaser, the Company will so
advise the Representative and, upon request from the
Representative, will forthwith at the Company's expense, or
at the expense of the Underwriters if the only event
occasioning the supplement or amendment is a change in the
purchasing or distribution arrangements, prepare and furnish
to the Representative (in form satisfactory to Underwriters'
Counsel) a reasonable number of copies of a supplemented or
amended prospectus or the document incorporated therein or,
at the option of the Company, a reasonable number of
appropriate supplements to be attached to the Prospectus, so
that the Prospectus as supplemented or amended will not
contain 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
are made, not misleading. In case any Underwriter is
required to deliver a prospectus descriptive of the Bonds
more than nine months after the date hereof, the Company,
upon the request of the Representative, will furnish to the
Representative, at the expense of such Underwriter, a
reasonable quantity of copies of a supplemented or amended
prospectus meeting the requirements of section 10(a) of the
Securities Act.
(g) The Company will make generally available to its
security holders, as soon as practicable, an earnings
statement (which need not be certified) covering a
twelve-month period commencing subsequent to the date hereof,
which earnings statement shall satisfy the requirements of
Section 11(a) of the Securities Act and Rule 158 promulgated
thereunder.
9. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The obligations
of the several Underwriters to purchase and pay for the Bonds
shall be subject to the performance by the Company of its
obligations hereunder and the following conditions:
(a) Prior to 7 P.M., Boston time, on the date hereof,
the Indenture shall have been qualified under the Trust
Indenture Act of 1939, there shall have been issued an order
of the MDPU, to the extent that it has jurisdiction,
permitting the issuance and sale of the Bonds, and at such
time and on the Closing Date such order shall not contain any
provision which, in the opinion of the Representative or the
Company, is unduly burdensome to the Company, it being
understood that such order as is now in effect does not
contain any such unduly burdensome provision.
(b) All legal proceedings to be taken and all legal
opinions to be rendered in connection with the issue and sale
of the Bonds shall be satisfactory to Underwriters' Counsel.
Prior to or concurrently with the delivery of the Bonds, the
Representative shall have received the following opinions and
letter, with printed or duplicated copies thereof for each of
the Underwriters, with such changes therein as may be agreed
upon by the Company and the Representative with the approval
of Underwriters' Counsel:
(i) Opinion of Robert King Wulff, Esq. and/or Kirk
L. Ramsauer, Esq., counsel for the Company,
substantially in the form attached hereto as Exhibit 1;
(ii) Opinion of Underwriters' Counsel substantially
in the form attached hereto as Exhibit 2; and
(iii) Letter of Coopers & Lybrand L. L. P., dated
the Closing Date and addressed to the Company and to the
Representative, confirming that they are independent
certified public accountants with respect to the Company
within the meaning of the Securities Act and the
applicable published rules and regulations thereunder,
and stating in effect:
(1) that in their opinion the financial
statements and financial statement schedules
(included or incorporated by reference in the
Registration Statement) examined by them as stated
in their report (incorporated by reference in the
Registration Statement) comply as to form in all
material respects with the applicable accounting
requirements of the Exchange Act and of the
published rules and regulations thereunder;
(2) that on the basis of a reading of the
minutes of the meetings of the stockholders and the
Board of Directors of the Company held during any
period subsequent to 199__, and not covered by the
Financial Statements referred to in paragraph (1)
of this clause, as set forth in the minute books
through a specified date not more than five
business days prior to the date of their letter, a
reading of the unaudited financial statements of
the Company included or incorporated by reference
in the Registration Statement, and inquiries of
officials of the Company who have responsibility
for financial and accounting matters (which
procedures do not constitute an examination made in
accordance with generally accepted auditing
standards), they agree that, if any unaudited
amounts of total operating revenue and net income
are set forth or incorporated by reference in the
Registration Statement, including amounts set forth
under "Selected Financial Information", they agree
with the corresponding amounts set forth in the
unaudited financial statements for that period.
Those officials of the Company who have
responsibility for financial and accounting matters
stated:
(i) that the unaudited financial statements
included or incorporated by reference in the
Registration Statement are in conformity as to
form in all material respects with the
applicable accounting requirements of the
Exchange Act and the published rules and
regulations thereunder, and that said
financial statements are in conformity with
generally accepted accounting principles
applied on a basis substantially consistent
with that of the audited financial statements
incorporated by reference in the Registration
Statement;
(ii) that, during the period from the date of
the latest financial statements included or
incorporated by reference in the Registration
Statement through a specified date not more
than five business days prior to the date of
their letter, there was no change in the
capital stock and no increase in long-term
debt of the Company;
except in all instances as set forth or incorporated by
reference in or contemplated by the Prospectus; and
(3) that they have compared the dollar amounts
contained in Exhibit 12 (Computation of Ratio of
Earnings to Fixed Charges) to the Registration
Statement with such dollar amounts derived from the
unaudited financial statements incorporated by
reference in the Registration Statement, general
accounting records of the Company or from schedules
prepared by the Company or derived directly from
such records or schedules by analysis or
computation, and have found such dollar amounts to
be in agreement, and have recalculated the ratios
contained in Exhibit 12 and have found the
calculation of such ratios to be mathematically
correct, except in each case as otherwise stated in
said letter.
(c) At the time of the delivery of the Bonds:
(i) no stop order suspending the effectiveness
of the Registration Statement shall have been
entered and be in effect, no proceeding for that
purpose shall be pending, and any request on the
part of the Commission for amendments or additional
information shall have been complied with to its
satisfaction;
(ii) the order of the MDPU referred to in
paragraph (a) of this Section shall remain in force
and effect; and
(iii) the representations and warranties of
the Company herein shall be true and correct;
and the Representative shall have received a certificate
signed by an officer of the Company to such effect, to the
best of his knowledge, information, and belief.
If any provision of this Section is not fulfilled at or prior
to the delivery of the Bonds, this Underwriting Agreement may be
terminated by the Representative (with the consent of
Underwriters, including the Representative, who have agreed to
purchase in the aggregate 50% or more in principal amount of the
Bonds) upon delivering written notice thereof to the Company.
Any such termination shall be without liability of any party to
any other party, except as otherwise provided in paragraph (e) of
Section 8.
10. CONDITIONS OF THE COMPANY'S OBLIGATION. The obligation
of the Company to deliver the Bonds is subject to the following
conditions:
(a) The conditions set forth in paragraphs (a), (c)(i),
and (c)(ii) of Section 9 hereof.
(b) Concurrently with the delivery of the Bonds, the
Company shall receive the full purchase price for all of the
Bonds.
If any provision of this Section is not fulfilled at or prior
to the delivery of the Bonds, this Underwriting Agreement may be
terminated by the Company, by written notice delivered to the
Representative. Any such termination shall be without liability
of any party to any other party, except as otherwise provided in
paragraph (e) of Section 8.
11. TERMINATION. This Underwriting Agreement may be
terminated at any time prior to the Closing Date by the
Representative (with the consent of Underwriters including the
Representative who have agreed to purchase in the aggregate 50%
or more in principal amount of the Bonds), upon notice thereof to
the Company, if prior to such time (a) there shall have occurred
any general suspension of trading in securities on the New York
Stock Exchange or there shall have been established by the New
York Stock Exchange, the Commission, or any Federal or state
agency or by the decision of any court, any limitation on prices
for such trading or any restrictions on the distribution of
securities, (b) a banking moratorium shall have been declared
either by Federal or New York State authorities, or (c) there
shall have occurred the outbreak or escalation of hostilities
involving the United States or the declaration by the United
States of a national emergency or war, if the effect of any such
event specified in this clause (c) in the judgement of the
Representative makes it impracticable or inadvisable to proceed
with the public offering or the delivery of the Bonds on the
terms and in the manner contemplated by the Prospectus.
Any termination of this Underwriting Agreement pursuant to
this Section shall be without liability of any party to any other
party, except as otherwise provided in paragraph (e) of Section
8.
12. INDEMNIFICATION. (a) The term Preliminary Prospectus as
used in this Section 12 shall mean the prospectus included in the
registration statement on the date of its initial effectiveness
and such prospectus as and if amended or supplemented prior to
the date this Underwriting Agreement becomes effective and shall
also include all preliminary prospectuses. The terms
Registration Statement and Prospectus as used in this Section 12
shall mean said documents as defined, respectively, in Sections
4(a) and 4(b) hereof and shall also include each and every
amendment of and supplement to said documents, respectively,
furnished by the Company to the Underwriters or to the
Representative for distribution to the Underwriters. No
indemnity by the Company hereunder shall apply in respect of (i)
any Prospectus or Preliminary Prospectus used at a time not
authorized under the Securities Act or this Underwriting
Agreement, (ii) any Prospectus or Preliminary Prospectus used in
unamended or unsupplemented form after the same has been amended
or supplemented, provided the Company has supplied such amendment
or supplement to the Underwriters or to the Representative for
distribution to the Underwriters, or (iii) any Underwriter, or
any person controlling such Underwriter, on account of any loss,
claim, or liability arising by reason of any person acquiring any
of the Bonds, if a copy of the Prospectus has not been sent or
given by an Underwriter or a securities dealer to such person
with or prior to the written confirmation of the sale involved.
No use of any Preliminary Prospectus is authorized after the date
hereof.
(b) The Company will indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter
within the meaning of Section 15 of the Securities Act against
any loss, claim, or liability, joint or several (including the
reasonable cost of investigating or defending any such alleged
loss, claim, or liability and reasonable counsel fees incurred in
connection therewith), arising by reason of any person acquiring
any of the Bonds, on the ground that the Registration Statement,
the Prospectus, or the Preliminary Prospectus includes or
included an untrue statement of a material fact or omits or
omitted to state a material fact which (in the case of the
Registration Statement or the registration statement as now
effective) is or was required to be stated therein or is or was
necessary to make the statements therein not misleading or which
(in the case of the Prospectus or the Preliminary Prospectus) is
or was necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading,
unless such statement or omission was made in reliance upon
written information furnished to the Company by any Underwriter,
or by and through the Representative on behalf of any
Underwriter, for use therein, or unless such statement or
omission shall occur in the Statement of Eligibility and
Qualification under the Trust Indenture Act of 1939 of the
Trustee under the Indenture. For purposes of the foregoing, no
Underwriter shall be deemed to be required to send or give a copy
of documents incorporated by reference in the Prospectus to any
person with or prior to the written confirmation of the sale
involved in order to be entitled to the benefits of the
indemnification provided for herein. Upon commencement of any
such suit, if any Underwriter or any such controlling person
wishes to make a claim in respect thereof against the Company
under its agreement herein contained, such Underwriter or such
controlling person, as the case may be, shall, within thirty days
after the summons or other first legal process giving information
of the nature of the claim shall have been served upon such
Underwriter or upon such controlling person (or after he shall
have received notice of such service on any designated agent),
give notice in writing of such suit to the Company; but failure
so to notify the Company shall not relieve it from any liability
which it may have to the person against whom such suit is
brought, otherwise than on account of its indemnity agreement
contained in this paragraph. The Company will be entitled to
participate at its own expense in the defense or, if it so
elects, to assume the defense of any such suit, and, if the
Company elects to assume the defense, the defendant or defendants
therein will be entitled to participate in the defense but shall
bear the fees and expenses of any additional counsel retained by
them, unless the indemnifying party and the indemnified party
shall have mutually agreed to the retention of such counsel. The
indemnifying party shall not be liable for any settlement of any
proceeding effected without its written consent but if settled
with such consent or if there be a final judgment for the
plaintiff, the indemnifying party agrees to indemnify the
indemnified party from and against any loss or liability by
reason of such settlement or judgment.
(c) Each Underwriter will indemnify and hold harmless the
Company and each of its officers and directors and each person,
if any, who controls the Company within the meaning of Section 15
of the Securities Act, to the same extent as the Company in the
foregoing paragraph (b) agrees to indemnify and hold harmless
each Underwriter, but only with respect to any written
information furnished to the Company by such Underwriter, or by
and through the Representative on behalf of such Underwriter, for
use in the Prospectus. If any action shall be brought hereunder
against the Company or any such officer, director, or controlling
person, such Underwriter shall have the rights and duties given
to the Company by paragraph (b), and the Company or such officer,
director, or controlling person shall have the rights and duties
given to such Underwriter by said paragraph.
(d) If the indemnification provided for in this Section 12 is
unavailable to an indemnified party, then each indemnifying
party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified
party as a result of such loss, claim, or liability in such
proportion as is appropriate to reflect not only the relative
benefits received by the Company on the one hand and the
Underwriter on the other but also the relative fault of the
Company on the one hand and of the Underwriter on the other in
connection with the statement or omission that resulted in such
loss, claim, or liability, as well as any other relevant
equitable considerations. The relative benefits received by the
Company on the one hand and by the Underwriter on the other in
connection with the offering shall be deemed to be in the same
proportion as the total net proceeds from the offering, before
deducting expenses, received by the Company bear to the total
underwriting discounts or commissions, if any, received by all of
the Underwriters, in each case as set forth in the table on the
cover page of the Prospectus. If there are no such underwriting
discounts or commissions so set forth, the relative benefits
received by the Underwriter shall be the difference between the
price received by the Underwriter upon sale of the Bonds and the
price paid for the Bonds pursuant to this Underwriting Agreement.
The relative fault of the Company on the one hand and of the
Underwriter on the other shall be determined by reference to,
among other things, whether the untrue or allegedly untrue
statement of a material fact or the omission or alleged omission
to state a material fact relates to information supplied by the
Company or by the Underwriter and the parties' relative intent,
knowledge, access to information, and opportunity to correct or
prevent such statement or omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f)
of the Securities Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation.
(e) The indemnities contained in this Section and all the
representations and warranties contained in this Underwriting
Agreement shall survive the delivery of the Bonds.
13. SUBSTITUTION OF UNDERWRITERS. (a) If one or more
Underwriters fail or refuse to take up and pay for the entire
principal amount of Bonds that it or they agreed to purchase
under this Underwriting Agreement and the aggregate principal
amount of Bonds which all such defaulting Underwriters shall have
failed to purchase does not exceed ten percent of the aggregate
principal amount of the Bonds, the nondefaulting Underwriters
shall have the right and are obligated severally to take up and
pay for (in addition to the principal amounts of Bonds set forth
opposite their respective names in the Confirmation) the total
principal amount of Bonds agreed to be purchased by all such
defaulting Underwriters in the respective proportions which the
principal amounts set forth opposite the names of the
nondefaulting Underwriters in the Confirmation bear to the
aggregate principal amount so set forth opposite the names of all
such nondefaulting Underwriters; provided, however, that no Bonds
of denominations smaller than $1,000 are to be delivered and, if
Bonds of smaller denominations would result from the aforesaid
proportions, such smaller denominations shall be combined and the
resulting $1,000 Bond or Bonds shall be delivered to, and shall
be purchased by, such Underwriter or Underwriters as the
Representative shall designate. In such event, the
Representative, for the accounts of the several nondefaulting
Underwriters, may take up and pay for all or any part of such
principal amount of Bonds to be purchased by each remaining
Underwriter under this paragraph and, in order to effect
necessary changes in the Registration Statement, Prospectus, and
other documents and arrangements, may postpone the Closing Date
not more than four full business days.
(b) If one or more of the Underwriters shall fail or refuse
to take up and pay for the entire principal amount of Bonds which
he or they have agreed to purchase under this Underwriting
Agreement and the aggregate principal amount of Bonds which all
such defaulting Underwriters shall have failed to purchase
exceeds ten percent of the aggregate principal amount of the
Bonds, the nondefaulting Underwriters, or any one or more of
them, at 10 A.M., Boston time, on the Closing Date or within 24
hours thereafter, shall have the right to take up and pay for (in
such proportion as may be agreed upon among them so long as no
Bonds of denominations smaller than $1,000 are to be delivered),
or to substitute another Underwriter or Underwriters to take up
and pay for, the total principal amount of Bonds agreed to be
purchased by all such defaulting Underwriters. In the event that
the nondefaulting Underwriters shall not take up and pay for all
the Bonds which the defaulting Underwriters shall have agreed but
failed to purchase, or substitute another Underwriter or
Underwriters, as aforesaid, the Company shall have the privilege
of finding and substituting within a further 24-hour period
another Underwriter or Underwriters to purchase the principal
amount of Bonds which the defaulting Underwriters agreed but
failed to purchase. (The term Underwriter as used in this
Underwriting Agreement shall refer to and include each
Underwriter substituted under this paragraph with the same effect
as if said substituted Underwriter had originally been named in
the Confirmation.) In any such case, either the Company or the
Representative shall have the right to postpone the Closing Date
not more than seven full business days, in order that necessary
changes in the Registration Statement, the Prospectus, and any
other documents and arrangements may be effected. If said
nondefaulting Underwriters shall not take up and pay for such
principal amount of Bonds, or substitute another Underwriter or
Underwriters therefor, and the Company shall not substitute
another Underwriter or Underwriters therefor, all as aforesaid,
then this Underwriting Agreement shall terminate without any
liability on the part of the Company (except as otherwise
provided in paragraph (e) of Section 8) or of any nondefaulting
Underwriter. Nothing contained in this paragraph shall obligate
any Underwriter to purchase or find underwriters for any
principal amount of Bonds in excess of the amount agreed to be
purchased by such Underwriter under the terms of Section 6, nor
shall anything in this paragraph relieve any defaulting
Underwriter of any liability to the Company which it might
otherwise have.
14. PERSONS ENTITLED TO BENEFIT OF UNDERWRITING AGREEMENT.
This Underwriting Agreement shall inure to the benefit of the
Company and the Underwriters (and, as to the provisions of
Section 12, the other persons indemnified thereunder) and their
respective successors and assigns. Nothing in this Underwriting
Agreement is intended or shall be construed to give to any other
person, firm, or corporation any legal or equitable right,
remedy, or claim under or in respect of this Underwriting
Agreement or any provision herein contained. The term
"successors and assigns" as used in this Underwriting Agreement
shall not include any purchaser, as such purchaser, of any of the
Bonds from any of the Underwriters.
15. NOTICES. Any request, consent, notice, or other
communication on behalf of the Underwriters shall be given in
writing by the Representative addressed to the Treasurer of the
Company at 25 Research Drive, Westborough, Massachusetts 01582,
and any notice or other communication by the Company to the
Underwriters shall be given in writing to the Representative, at
its address stated in the Confirmation.
16. EFFECTIVENESS OF UNDERWRITING AGREEMENT. The date on
which this Underwriting Agreement is effective is the date stated
in the Confirmation.
17. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of The Commonwealth of
Massachusetts.
18. COUNTERPARTS. This Agreement may be executed by one or
more of the parties hereto in any number of counterparts, each of
which shall be deemed an original, but all such counterparts
shall together constitute one and the same instrument.
Exhibit 1 to
Terms of Purchase
PROPOSED FORM OF OPINION
OF
COUNSEL FOR THE COMPANY
_____________, 19__
As Representatives of the Several Underwriters
Re: MASSACHUSETTS ELECTRIC COMPANY
First Mortgage Bonds, Series ___, _____%, due __________
(Original Issue Date: _______________)
Dear Representatives:
We have acted as counsel for Massachusetts Electric Company
(the Company) in connection with the issue by it of $__________
principal amount of First Mortgage Bonds, Series ___, _____%, due
__________ (Original Issue Date: __________) (the Bonds), and are
therefore familiar with the proceedings taken in connection
therewith. The Company is a subsidiary of New England Electric
System.
This opinion is furnished to you pursuant to Section 9(b)(i)
of the Underwriting Agreement which became effective on
__________, 19__, between you as underwriter of the Bonds and the
Company and is being delivered on the Closing Date referred to
therein, concurrently with said issue of Bonds.
The Bonds are being issued under a First Mortgage Indenture
and Deed of Trust dated as of July 1, 1949 (the Original
Indenture), as supplemented and amended by an __________
Supplemental Indenture dated as of __________, 19__, and previous
supplemental indentures (the Original Indenture and all
supplemental indentures being collectively referred to herein as
the Indenture).
We are of opinion that:
1. The Company is a corporation validly organized and duly
existing under the laws of The Commonwealth of Massachusetts, has
the corporate power to transact the electric business in which it
is now engaged, and has franchises adequate for carrying on such
business.
2. The Company had full power and authority to accept your
offer for the purchase of the Bonds, and the Underwriting
Agreement has been duly authorized, executed, and delivered by
the Company.
3. The Company had corporate power proper and adequate for
making the Indenture which was duly executed and delivered in
accordance with proper authority from the stockholders and
directors of the Company. The ___________ Supplemental
Indenture, including Schedule __ thereto, contains a correct and
adequate description of the real estate, rights or interests in
real estate, and fixed property of the Company acquired up to
__________, 19__, and not included in the Original Indenture or
the previous supplemental indentures, and now owned of record,
except for the properties expressly excluded from the Indenture.
4. All filings and recordings of or in respect of the
Indenture have been duly made where such filings and recordings
are necessary for the preservation or protection of the lien
thereof, and the Indenture is a valid, binding, and enforceable
instrument subject, as to enforcement, to bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or
affecting the enforcement of creditors' rights generally and to
the effects of general principles of equity (regardless of
whether enforceability is considered in a proceeding in equity or
at law).
5. The Company has corporate power proper and adequate for
the execution and issuance of the Bonds under the Indenture in an
aggregate principal amount not exceeding $__________ and in
accordance with due authorization from the stockholders and
directors of the Company and, based in part upon certificates by
an officer of the Company and by an officer of the Trustee under
the Indenture as to execution, certification, and delivery, said
Bonds have been duly issued and are valid and binding obligations
of the Company and entitled to the benefits and security of the
Indenture.
6. Said Bonds, together with all other now outstanding First
Mortgage Bonds of the Company, are secured by a direct first
mortgage lien on substantially all the properties and franchises
now owned by the Company, subject to the property specifically
excepted in the granting clauses of, and to the liens permitted
by, the Indenture, including the prior lien of the Trustee for
compensation, expenses, and liabilities; and, except as
aforesaid, there is no existing indebtedness secured by lien on
the property securing such Bonds ranking prior to or on a parity
with the lien securing such Bonds.
7. The property specifically described as mortgaged property
in the Indenture constitutes substantially all of the property
owned by the Company and used by, or useful to, it in its
business, except for the property expressly excepted from the
Indenture. None of the real estate and rights in real estate
described in the schedules to the Indenture and which constitute
the principal properties of the Company is excluded from the lien
of the Indenture by virtue of the provisions of clause (c) of the
paragraph in the Original Indenture beginning "But Specifically
Reserving, Excepting and Excluding," and as to the remainder of
the properties described in said schedules the exclusions, if
any, by virtue of said clause (c) are minor.
8. The principal substations of the Company are in general
on land owned by the Company, the balance being upon land of
others pursuant to lease or other arrangements. The electric
lines and related equipment of the Company are in general on land
of others, being in substantial part located upon, over, or under
public streets or highways and in part upon, over, or under
private ways or other property not owned by the Company, such
occupation of private property in general pursuant to easements,
licenses, or permits from owners thereof, but without examination
of titles, or pursuant to long user, a majority of the poles
being owned jointly with others, principally telephone companies.
9. With respect to the issue and sale of the Bonds, an order
has been issued by the Massachusetts Department of Public
Utilities, to the extent it has jurisdiction, authorizing the
issue and sale of the Bonds and said order remains, to the best
of our knowledge, in effect at this date; the Company is exempted
by Rule 52 under the Public Utility Holding Company Act of 1935
(the 1935 Act) from the requirement of an order of the Securities
and Exchange Commission (the Commission); the Indenture has been
qualified under the Trust Indenture Act of 1939; the Registration
Statement referred to below has become effective under the
Securities Act of 1933, as amended (the Securities Act); said
order and said Registration Statement remain, to the best of our
knowledge, in effect at this date; and no other approval,
consent, or action of any governmental or regulatory authority is
required for the issue and sale of the Bonds or the carrying out
of the provisions of the Underwriting Agreement (except under the
so-called blue-sky or securities laws of the several states in
connection with sales by you and others of the Bonds, the
applicability of which we have not considered and as to which we
express no opinion).
10. The statements upon our authority made or incorporated
by reference in the registration statement, as amended by all
amendments thereto, filed with the Commission under the
Securities Act (the Registration Statement) and in the prospectus
dated __________, 19__, as supplemented by the prospectus
supplement dated __________, 19__, relating to the Bonds (the
Prospectus) are correct; the Registration Statement and the
Prospectus, including all documents incorporated by reference
therein in accordance with the requirements of Form S-3 under the
Securities Act (except for the financial statements contained or
incorporated by reference therein, as to which we express no
opinion), comply as to form in all material respects with the
relevant requirements of the Securities Act and the Securities
Exchange Act of 1934, as amended, and of the applicable rules,
regulations, and releases of the Commission thereunder; and the
Bonds conform to the description thereof in the Registration
Statement and Prospectus. While we have not made a detailed
review of the accuracy or completeness of other information in,
or incorporated by reference in, the Registration Statement and
Prospectus and assume no responsibility therefor, nothing has
come to our attention which leads us to believe that either the
Registration Statement or the Prospectus, or the documents
incorporated by reference therein, contains any untrue statement
of a material fact or omits to state a material fact required to
be stated therein or necessary to make the statements therein not
misleading.
The above opinion, insofar as it relates to mortgaging of
franchises, relates to the mortgaging of secondary franchises and
not to the mortgaging of the Company's primary franchise to be a
corporation. The above opinion insofar as it relates to the
execution and delivery of the Original Indenture and certain
supplemental indentures prior to the __________ Supplemental
Indenture is based upon opinions of other counsel for the
Company. The above opinion, insofar as it relates to titles, is
based in part upon opinions of local counsel and of counsel
associated with us and in part upon examination of titles of the
Company to its principal properties by title examiners under our
direction, the direction of counsel associated with us, or the
direction of local counsel, or examination by local counsel and
reviewed by us or counsel associated with us, such title
examiners and local counsel being, in our opinion, of good
standing and experienced in the examination of titles. In the
case of easements over lands of others, the title of the grantors
of the easements were not in all cases examined to the same
extent as in the case of fee ownership and in some instances such
easements depend upon long user.
We are members of the bar of The Commonwealth of
Massachusetts and we do not express any opinion as to matters
governed by any laws other than those of The Commonwealth of
Massachusetts and the Federal Law of the United States of
America.
Yours very truly,
ROBERT KING WULFF*
Corporation Counsel
KIRK L. RAMSAUER*
Assistant General Counsel
______________________
*To be signed by ROBERT KING WULFF and/or KIRK L. RAMSAUER.
Exhibit 2 to
Terms of Purchase
PROPOSED FORM OF OPINION
of
MILBANK, TWEED, HADLEY & MCCLOY
1 CHASE MANHATTAN PLAZA
NEW YORK, NEW YORK 10005
__________, 19__
and the other several Underwriters
named in the Underwriting Agreement
referred to below,
Re: MASSACHUSETTS ELECTRIC COMPANY
First Mortgage Bonds, Series ___, _____%, due __________
Dear Sirs:
We have acted as your counsel in connection with your
purchase from Massachusetts Electric Company, a Massachusetts
corporation (the Company), pursuant to a Underwriting Agreement
dated __________, 19__ (the Underwriting Agreement) made with the
Company, of $__________ aggregate principal amount of First
Mortgage Bonds, Series ___, _____%, due __________ (the Bonds) of
the Company, issued under and pursuant to the First Mortgage
Indenture and Deed of Trust dated as of July 1, 1949, as
supplemented and modified by __________ supplemental indentures
(collectively, the Mortgage), between the Company and State
Street Bank and Trust Company, successor to The Second National
Bank of Boston, as Trustee (the Trustee). As such counsel we
have reviewed originals, or copies certified to our satisfaction,
of all such corporate records of the Company, indentures,
agreements and other instruments, certificates of public
officials and of officers and representatives of the Company and
of the Trustee, and other documents, as we have deemed necessary
to require as a basis for the opinions hereinafter expressed. In
such examination we have assumed the genuineness of all
signatures, the authenticity of all documents submitted to us as
originals, the conformity with the original documents of all
documents submitted to us as copies, and the authenticity of the
originals of such latter documents. As to various questions of
fact material to such opinions, we have, when relevant facts were
not independently established, relied upon certifications by
officers of the Company and other appropriate persons and
statements contained in the Registration Statement hereinafter
mentioned.
In addition, we attended the closing held today at the
principal office of State Street Bank and Trust Company, 225
Franklin Street, Fourth Floor, Boston, Massachusetts, in the
course of which the Company caused to be delivered to you
$__________ aggregate principal amount of Bonds against payment
therefor.
Based upon the foregoing, and having regard to legal
considerations which we deem relevant, we are of the opinion
that:
1. The Underwriting Agreement has been duly authorized,
executed and delivered by the Company.
2. The registration statement with respect to the Bonds
filed with the Securities and Exchange Commission (the
Commission) pursuant to the Securities Act of 1933, as amended
(the Act), as amended by all amendments thereto (the Registration
Statement), has become effective and, to the best of our
knowledge, remains in effect on the date hereof, and the
prospectus with respect to the Bonds dated __________, 19__, as
supplemented by the prospectus supplement dated __________, 19__,
including all documents incorporated by reference therein
pursuant to the requirements of Form S-3 under the Act (the
Prospectus), is lawful for use for the purposes specified in the
Act in connection with the offer for sale and the sale of the
Bonds in the manner specified therein, subject to compliance with
the provisions of securities or "blue sky" laws of certain
jurisdictions in connection with the offer and sale of the Bonds
in such jurisdictions.
The Registration Statement and the Prospectus (except the
financial statements and other financial data included therein,
as to which we express no opinion) comply as to form in all
material respects with the requirements of the Act and with the
applicable published rules and regulations of the Commission
under the Act.
As to the financial statements included in the Prospectus, we
have made no examination of the Company's books of account and we
therefore express no opinion. As to the statements under
"Description of Series ___ Bonds", (except the financial data
included thereunder as to which we express no opinion), subject
to the concluding paragraph of this opinion, we are of the
opinion that the statements are accurate and do not omit any
material fact required to be stated therein or necessary to make
such statements not misleading. As to other matters, we have not
undertaken to determine independently the accuracy or
completeness of the statements contained in the Registration
Statement or in the Prospectus. We have, however, participated
in conferences with representatives of the Company and of New
England Power Service Company in connection with the preparation
of the Registration Statement and the Prospectus and we have
reviewed all documents incorporated by reference in the
Prospectus pursuant to the requirements of Form S-3 under the Act
and such of the corporate records of the Company as we deemed
advisable. None of the foregoing disclosed to us any information
which gave us reason to believe that the Registration Statement
or the Prospectus (except the financial statements and other
financial data included therein, as to which we express no
opinion) contains any untrue statement of a material fact or
omits to state a material fact required to be stated therein or
necessary to make the statements therein not misleading.
3. The Company is exempt under Rule 52 of the Public Utility
Holding Company Act of 1935 from the requirement for an order of
the Commission under said Act with respect to the issue and sale
of the Bonds.
4. The Massachusetts Department of Public Utilities has
issued an appropriate order with respect to the issue and sale of
the Bonds. Said order, to the best of our knowledge, remains in
effect on the date hereof.
5. No other order, approval or consent of any public
regulatory body is legally required under federal law for the
issue and sale of the Bonds pursuant to the Underwriting
Agreement or the carrying out of the provisions of the
Underwriting Agreement.
6. The Mortgage has been duly authorized, executed and
delivered by the Company, and having, in the opinion of Robert
King Wulff, Esq., Corporation Counsel for the Company, and Kirk
L. Ramsauer, Esq., Assistant General Counsel for the Company,
referred to below, upon which we rely, been duly filed and
recorded, constitutes a valid mortgage legally effective to
create a lien (as to the ranking of which reference is made to
said opinion) as security for the Bonds upon the interest of the
Company in the property now owned by the Company which is
described in the Mortgage as subject to the lien thereof; and the
Mortgage is a valid, binding and enforceable instrument, subject,
as to enforcement, to bankruptcy, insolvency, reorganization,
moratorium or other similar laws of general applicability
relating to or affecting the enforcement of creditors' rights
generally. The enforceability of the Mortgage is further subject
to the effect of general principles of equity (regardless of
whether considered in a proceeding in equity or at law),
including without limitation (i) the possible unavailability of
specific performance, injunctive relief or any other equitable
remedy and (ii) concepts of materiality, reasonableness, good
faith and fair dealing, and subject also to the possible
inefficacy of certain provisions of the Mortgage, whereby the
Company undertakes, upon the happening of an event of default, to
create a lien upon certain property theretofore expressly
excluded from the Mortgage.
The Mortgage has been duly qualified under the Trust
Indenture Act of 1939, as amended.
7. The Bonds purchased by you conform as to legal matters in
all substantial respects to the description thereof contained in
the Registration Statement and the Prospectus and have been duly
authorized and (assuming due execution thereof by the Company and
certification by the Trustee) issued under the Mortgage and are
valid and binding obligations of the Company.
The foregoing opinions are subject to the following:
We have made no examination of the Company's title to the
properties purported to be owned by it or of the ranking of the
lien created by the Mortgage or of the franchises under which the
Company operates. We express no opinion on such matters
(including the adequacy of the real property descriptions in the
Mortgage), and, to the extent that the opinions herein expressed
involve such matters, we have relied upon the opinion of Robert
King Wulff, Esq. and Kirk L. Ramsauer, Esq., addressed to you on
this date. Furthermore, with respect to the filing and recording
of the Mortgage, we have also relied upon said opinion of counsel
for the Company.
In rendering the opinions hereinabove expressed, we have
relied upon said opinion of Robert King Wulff, Esq. and Kirk L.
Ramsauer, Esq. as to all matters governed by the law of the
Commonwealth of Massachusetts and as to such matters, the
opinions hereinabove expressed are subject to all qualifications,
limitations, assumptions and reliances, and other considerations,
therein set forth.
We are members of the bar of the State of New York and we do
not express any opinion as to matters governed by any laws other
than the law of the State of New York, the Federal law of the
United States of America, and to the extent hereinabove stated in
reliance upon said opinions of Robert King Wulff, Esq. and Kirk
L. Ramsauer, Esq., the law of the Commonwealth of Massachusetts.
Very truly yours,
MILBANK, TWEED, HADLEY & MCCLOY