Exhibit 1
PUBLIC SERVICE COMPANY OF COLORADO
(a Colorado corporation)
Secured Medium-Term Notes, Series B
Due From Nine Months to Thirty Years from Date of Issue
DISTRIBUTION AGREEMENT
[DATE]
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
World Financial Center
10th Floor, North Tower
New York, New York 10281-1310
GOLDMAN, SACHS & CO.
85 Broad Street
New York, New York 10004
Dear Sirs:
Public Service Company of Colorado, a Colorado corporation (the
"Company"), confirms its agreement with Merrill Lynch & Co., Merrill Lynch,
Pierce, Fenner & Smith Incorporated and Goldman, Sachs & Co. (each an "Agent";
collectively, the "Agents") with respect to the issue and sale by the Company of
its Secured Medium-Term Notes, Series B (being a series of First Collateral
Trust Bonds) (the "Notes"). The Notes are to be issued under the Company's
Indenture dated as of October 1, 1993, as heretofore supplemented by various
supplemental indentures, including a supplemental indenture dated as of November
1, 1996, to First Trust of New York, National Association, as successor trustee
(the "Trustee") to Morgan Guaranty Trust Company of New York (formerly Guaranty
Trust Company of New York). Said Indenture as so supplemented and to be
supplemented is hereinafter called the "Indenture" and such supplemental
indenture dated as of November 1, 1996 is hereinafter called the "Supplemental
Indenture". As of the date hereof, the Company has authorized the issuance and
sale of up to $250,000,000 aggregate principal amount of Notes to or through the
Agents pursuant to the terms of this Agreement.
This Agreement provides both for the sale of Notes by the Company to one
or more Agents as principal for resale to investors and other purchasers and for
the sale of Notes by the Company directly to investors (as may from time to time
be specified by the Company and agreed to by the applicable Agent), in which
case such Agent will act as an agent of the Company in soliciting purchases of
the Notes. The Company may also sell Notes directly to investors and other
investors on its own behalf and not through an Agent acting as agent.
The Company has filed with the Securities and Exchange Commission (the
"SEC") a registration statement on Form S-3 (No. 333-[ ]) for the registration
of First Collateral Trust Bonds, including the Notes, under the Securities Act
of 1933 (the "1933 Act") and the offering thereof from time to time in
accordance with Rule 415 of the rules and regulations of the SEC under the 1933
Act (the "1933 Act Regulations"). Such registration statement, [as amended], was
declared effective by the SEC at [ ], Eastern Standard Time, on [ ] (the later
of such time and date or the time and date of the filing thereafter of the
Company's most recent Annual Report on Form 10-K (a "10-K Report") is
hereinafter called the "Effective Date"). The Indenture has been duly qualified
under the Trust Indenture Act of 1939, as amended (the "1939 Act"). Such
registration statement and the prospectus constituting a part thereof, and any
prospectus supplement and pricing supplement relating to the Notes, including
all documents incorporated therein by reference, as from time to time amended or
supplemented by the filing of documents pursuant to the Securities Exchange Act
of 1934, as amended (the "1934 Act"), or the 1933 Act or otherwise, are referred
to herein as the "Registration Statement" and the "Prospectus", respectively,
except that if any revised prospectus shall be provided to the Agents by the
Company for use in connection with the offering of the Notes, whether or not
such revised prospectus is required to be filed by the Company pursuant to Rule
424(b) of the 1933 Act Regulations, the term "Prospectus" shall refer to such
revised prospectus from and after the time it is first provided to the Agents
for such use.
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SECTION 1. Appointment as Agents.
(a) Appointment of Agents. Subject to the terms and conditions stated
herein, the Company hereby agrees that Notes will be sold to or through the
Agents, except that the Company reserves the right to sell the Notes on its own
behalf directly to investors in those jurisdictions where it is authorized to do
so and, from time to time, to appoint additional agents to sell the Notes,
provided that the Company shall furnish the Agents with reasonable advance
notification of the appointment of any additional agent to sell the Notes and
provided further that such additional agents shall be required to execute
distribution agreements in form and substance substantially similar to this
Agreement.
(b) Sale of Notes. The Company shall not sell or approve the solicitation
of purchases of Notes in excess of the amount which shall be authorized by the
Company from time to time or in excess of the aggregate principal amount of
Notes registered pursuant to the Registration Statement. The Agents shall have
no responsibility for maintaining records with respect to the aggregate
principal amount of Notes sold, or of otherwise monitoring the availability of
Notes for sale, under the Registration Statement.
(c) Purchases as Principal. The Agents shall not have any obligation to
purchase Notes from the Company as principal, but one or more Agents may agree
from time to time to purchase Notes as principal for resale to investors and
other purchasers determined by such Agent or Agents. Any such purchase of Notes
by an Agent as principal shall be made in accordance with Section 3(a) hereof.
(d) Solicitations as Agent. If requested by the Company and agreed to by
an Agent, such Agent, acting solely as agent for the Company and not as
principal, will solicit purchases of the Notes. Such Agent will communicate to
the Company, orally, each offer to purchase Notes solicited by it on an agency
basis, other than those offers rejected by such Agent. Such Agent shall have the
right, in its discretion reasonably exercised, to reject any proposed purchase
of Notes, as a whole or in part, and any such rejection shall not be deemed a
breach of its agreement contained herein. The Company may accept or reject any
proposed purchase of Notes, in whole or in part. Such Agent shall make
reasonable efforts to assist the Company in obtaining performance by each
purchaser whose offer to purchase Notes has been solicited by it and accepted by
the Company. Such Agent shall not have any liability to the Company in the event
that any such purchase is not consummated for any reason. If the Company shall
default on its obligation to deliver Notes to a purchaser whose offer it has
accepted, the Company shall (i) hold such Agent harmless against any loss, claim
or damage arising from or as a result of such default by the Company and (ii)
pay to such Agent any commission to which it would otherwise be entitled absent
such default.
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(e) Reliance. The Company and the Agents agree that any Notes purchased by
one or more Agents as principal shall be purchased, and any Notes the placement
of which an Agent arranges as agent shall be placed by such Agent in reliance on
the representations, warranties, covenants and agreements of the Company
contained herein and on the terms and conditions and in the manner provided
herein.
SECTION 2. Representations and Warranties.
(a) The Company represents and warrants to each Agent as of the date
hereof, as of the date of each acceptance by the Company of an offer for the
purchase of Notes (whether to such Agent as principal or through such Agent as
agent), as of the date of each delivery of Notes (whether to such Agent as
principal or through such Agent as agent) (the date of each such delivery to an
Agent as principal being hereafter referred to as a "Settlement Date"), and as
of the times referred to in Section 7(a) hereof (each of the times referenced
above being referred to hereafter as a "Representation Date"), as follows:
(i) Registration Statement and Prospectus. At the Effective Date,
the Registration Statement and the Indenture complied, and as of the
applicable Representation Date will comply, in all material respects with
the requirements of the 1933 Act and the 1933 Act Regulations and the 1939
Act and the rules and regulations of the SEC promulgated thereunder. The
Registration Statement, at the Effective Date, did not, and at each time
thereafter at which any amendment to the Registration Statement becomes
effective and as of the applicable Representation Date, will not, contain
an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein
not misleading. The Prospectus, as of the date hereof does not, and as of
the applicable Representation Date will not, include an untrue statement
of a material fact or omit to state a material fact necessary in order to
make the statements therein, in the light of the circumstances under which
they were made, not misleading; provided, however, that the
representations and warranties in this subsection shall not apply to
statements in or omissions from the Registration Statement or Prospectus
made in reliance upon and in conformity with information furnished to the
Company in writing by the Agents expressly for use in the Registration
Statement or Prospectus or to that part of the Registration Statement
which constitutes the Trustee's Statement of Eligibility under the 1939
Act (Form T-1).
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(ii) Incorporated Documents. The documents incorporated by
reference into the Prospectus, at the time they were or hereafter are
filed with the SEC, complied or when so filed will comply, as the case may
be, in all material respects with the requirements of the 1934 Act and the
rules and regulations of the SEC thereunder (the "1934 Act Regulations"),
and, when read together and with the other information in the Prospectus,
did not and will not contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary
in order to make the statements therein, in the light of the circumstances
under which they were or are made, not misleading.
(iii) Accountants. The accountants who certified the financial
statements and supporting schedules included or incorporated by reference
in the Registration Statement and the Prospectus are independent public
accountants as required by the 1933 Act and the 1933 Act Regulations.
(iv) Financial Statements. The financial statements and any
supporting schedules of the Company and its consolidated subsidiaries
included or incorporated by reference in the Registration Statement and
the Prospectus present fairly the consolidated financial position of the
Company and its consolidated subsidiaries as at the dates indicated and
the results of their operations for the periods specified; except as
otherwise stated therein, said financial statements have been prepared in
conformity with generally accepted accounting principles applied on a
consistent basis; and the supporting schedules included or incorporated by
reference in the Registration Statement and the Prospectus present fairly
the information required to be stated therein.
(v) Material Changes or Material Transactions. Since the
respective dates as of which information is given in the Registration
Statement and the Prospectus, except as otherwise stated therein or
contemplated thereby, (A) there has been no material adverse change in the
business, property or condition, financial or otherwise, of the Company
and its subsidiaries considered as one enterprise, whether or not arising
in the ordinary course of business, and (B) there have been no
transactions entered into by the Company or any of its subsidiaries, other
than those in the ordinary course of business, which are material in
relation to the Company and its subsidiaries considered as one enterprise;
and, except as so stated or contemplated, neither the Company nor any of
its subsidiaries has any contingent obligations which are material to the
Company and its subsidiaries considered as one enterprise.
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(vi) Due Incorporation and Qualification. The Company has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of the State of Colorado with corporate power and authority
to own, lease and operate its properties and to conduct its business as
described in the Prospectus and the Company is duly qualified as a foreign
corporation to transact business and is in good standing in each
jurisdiction in which such qualification is required, whether by reason of
the ownership or leasing of property or the conduct of business, except
where the failure to so qualify or be in good standing would not have a
material adverse effect on the business, property or condition, financial
or otherwise, of the Company and its subsidiaries considered as one
enterprise.
(vii) Authorization and Validity of this Agreement, the Indenture
and the Notes. This Agreement has been duly and validly authorized by the
Company and, upon execution and delivery by the Agents and subject to any
principles of public policy limiting the right to enforce the
indemnification provisions contained herein, will be a valid and binding
agreement of the Company; the Indenture and the Supplemental Indenture
have each been duly and validly authorized by the Company and, upon
execution and delivery of the Supplemental Indenture by the Trustee, the
Indenture (including the Supplemental Indenture) will be a valid and
binding mortgage of the Company enforceable in accordance with its terms,
except as enforcement thereof may be limited by laws and principles of
equity affecting generally the enforcement of mortgagees' and other
creditors' rights, including without limitation, bankruptcy and insolvency
laws and state laws which affect the enforcement of certain remedial
provisions of the Indenture; the issuance and sale by the Company of the
Notes pursuant to this Agreement have been duly authorized by all
necessary corporate action and, when issued, authenticated and delivered
by the Company pursuant to this Agreement and the Indenture against
payment of the consideration therefor, the Notes will be valid and binding
obligations of the Company, enforceable in accordance with their terms,
except as enforcement thereof may be limited by laws and principles of
equity affecting generally the enforcement of mortgagees' and other
creditors' rights, including without limitation, bankruptcy and insolvency
laws and state laws which affect the enforcement of certain remedial
provisions of the Indenture; and the Notes and the Indenture will be
substantially in the form heretofore delivered to the Agents and conform
in all material respects to all statements relating thereto contained in
the Prospectus; and the Notes will be entitled to the benefits and
security of the Indenture, and will be secured equally and ratably (except
to the extent that any sinking, amortization, improvement or other fund
may afford
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additional security for the bonds of any particular series) with all other
bonds outstanding under the Indenture.
(viii) Class A Bonds. The issuance and delivery by the Company of
the Class A Bonds (as defined in the Indenture) to be made the basis of
the authentication and delivery of the Notes (the "Class A Bonds") have
been duly authorized by all necessary corporate action; and when (i) the
Class A Bonds have been issued, authenticated and delivered to the Trustee
pursuant to the Indenture and (ii) the Notes have been issued,
authenticated and delivered to the Purchasers pursuant to this Agreement
against payment of the consideration therefor specified herein, the Class
A Bonds will be valid and binding obligations of the Company, enforceable
in accordance with their terms, except as enforcement thereof may be
limited by laws and principles of equity affecting generally the
enforcement of mortgagees' and other creditors' rights, including without
limitation bankruptcy and insolvency laws and state laws which affect the
enforcement of certain remedial provisions of the PSCO 1939 Mortgage (as
defined in the Indenture), and will be entitled to the benefits of the
PSCO 1939 Mortgage.
(ix) No Defaults. The Company is not in violation of its charter or
by-laws or in default in the performance or observance of any material
obligation, agreement, covenant or condition contained in any contract,
indenture, mortgage, loan agreement, note, lease or other instrument to
which it is a party or by which it or any of them or their properties may
be bound or any law, administrative regulation or administrative or court
order or decree except to the extent set forth in the Registration
Statement and the Prospectus or except to the extent that such violation
or default would not have a material adverse effect on the business,
property or condition, financial or otherwise, of the Company and its
subsidiaries considered as one enterprise; and the execution and delivery
of this Agreement and the Supplemental Indenture, the incurrence of the
obligations herein set forth and the consummation of the transactions
contemplated herein and therein will not conflict with or constitute a
breach of, or default under or (other than under the Indenture and the
PSCO 1939 Mortgage with respect to the Notes and the Class A Bonds) result
in the creation or imposition of any lien, charge or encumbrance upon any
property or assets of the Company pursuant to any contract, lease, note,
mortgage, indenture, loan agreement or other instrument to which the
Company is a party or by which it may be bound or to which any of the
property or assets of the Company is subject, nor will such action result
in any violation of the provisions of the charter or by-laws of the
Company or any law, administrative regulation or administrative or court
order or decree.
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(x) Legal Proceedings; Contracts. Except as may be set forth in the
Registration Statement and the Prospectus, there is no action, suit or
proceeding before or by any court or governmental agency or body, domestic
or foreign, now pending, or, to the knowledge of the Company, threatened
against or affecting, the Company or any of its subsidiaries, which would
result in any material adverse change in the business, property or
condition, financial or otherwise, of the Company and its subsidiaries
considered as one enterprise, or which would materially and adversely
affect the consummation of this Agreement; and there are no contracts or
documents of the Company or any of its subsidiaries which are required to
be filed as exhibits to the Registration Statement by the 1933 Act or by
the 1933 Act Regulations which have not been so filed.
(xi) Authorization, Approval and Consent. The Company has filed with
The Public Utilities Commission of the State of Colorado (the "Colorado
Commission") an application with respect to, among other things, the
issuance and sale of the Company's debt securities, including the Notes,
and the Colorado Commission has issued its order authorizing and approving
such issuance and sale. If the above-mentioned order continues in full
force and effect, no further consent, order or authorization of or decree
or approval by the Colorado Commission or any other court or governmental
or regulatory authority or body is necessary in connection with the
consummation by the Company of the transactions contemplated by this
Agreement or the issuance and sale by the Company of the Notes pursuant to
this Agreement, except that there must be compliance with the securities
laws in the jurisdictions in which the Notes are to be offered and sold.
(xii) Ratings. The medium-term note program pursuant to which the
Notes are being issued (the "Program") as well as the Notes are rated [ ]
by Standard & Poor's Ratings Service and [ ] by Moody's Investors Service,
Inc., or such other rating as to which the Company shall have most
recently notified the Agents pursuant to Section 4(a) hereof.
(xiii) Subsidiaries. Each subsidiary of the Company which is a
significant subsidiary (each, a "Significant Subsidiary"), as defined in
Rule 405 of Regulation C of the 1933 Act Regulations, has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of the jurisdiction of its incorporation, has corporate
power and authority to own, lease and operate its properties and to
conduct its business as described in the Prospectus, and is duly qualified
as a foreign corporation to transact business and is in good standing in
each jurisdiction in which such qualification is required, whether by
reason of the ownership or leasing of property or the conduct of
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business, except where the failure to so qualify or be in good standing
would not have a material adverse effect on the business, property or
condition, financial or otherwise, of the Company and its subsidiaries
considered as one enterprise; all of the issued and outstanding capital
stock of each Significant Subsidiary has been duly and validly issued and
is fully paid and non-assessable; and all of the capital stock of each
Significant Subsidiary owned by the Company, directly or through
subsidiaries, is owned free and clear of any security interest, mortgage,
pledge, lien, encumbrance, claim or equity except that the stock of
certain of such subsidiaries is pledged under the PSCO 1939 Mortgage.
(b) Additional Certifications. Any certificate signed by any officer of
the Company and delivered to one or more Agents or to counsel for the Agents in
connection with an offering of Notes to one or more Agents as principal or
through an Agent as agent shall be deemed a representation and warranty by the
Company to such Agent or Agents as to the matters covered thereby on the date of
such certificate.
SECTION 3. Purchases as Principals; Solicitations as Agents.
(a) Purchases as Principals. Unless otherwise specified by the Company and
agreed to by an Agent, Notes shall be purchased by one or more Agents as
principal in accordance with terms agreed upon by such Agent or Agents and the
Company (which terms, unless otherwise agreed, shall, to the extent applicable,
include those terms specified in Exhibit A hereto and be agreed upon orally,
with written confirmation prepared by such Agent or Agents and facsimiled to the
Company). An Agent's commitment to purchase Notes as principal shall be deemed
to have been made on the basis of the representations and warranties of the
Company herein contained and shall be subject to the terms and conditions herein
set forth. Unless the context otherwise requires, references herein to "this
Agreement" shall include the agreement of one or more Agents to purchase Notes
from the Company as principal. Each purchase of Notes, unless otherwise agreed,
shall be at a discount from the principal amount of each such Note equivalent to
the applicable commission set forth in Schedule A hereto. The Agents may engage
the services of any other broker or dealer in connection with the resale of the
Notes purchased by them as principal and may allow all or any portion of the
discount received in connection with such purchases from the Company to such
brokers and dealers. At the time of each purchase of Notes by one or more Agents
as principal, such Agent or Agents shall specify the requirements for the
stand-off agreement, officers' certificate, opinions of counsel and comfort
letter pursuant to Sections 4(l), 7(a), 7(b) and 7(c) hereof.
(b) Solicitations as Agents. On the basis of the representations and
warranties herein contained, but subject to
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the terms and conditions herein set forth, when agreed by the Company and an
Agent, such Agent, as an agent of the Company, will use its reasonable efforts
to solicit offers to purchase the Notes upon the terms and conditions set forth
herein and in the Prospectus. The Agents are not authorized to appoint
sub-agents with respect to Notes sold through them as agent. All Notes sold
through an Agent as agent will be sold at 100% of their principal amount unless
otherwise agreed to by the Company and such Agent.
The Company reserves the right, in its sole discretion, to suspend
solicitation of offers to purchase the Notes through the Agents, as agents,
commencing at any time for any period of time or permanently. As soon as
practicable after receipt of instructions from the Company, the Agents will
suspend solicitation of offers to purchase the Notes from the Company until such
time as the Company has advised the Agents that such solicitation may be
resumed.
The Company agrees to pay each Agent a commission, in the form of a
discount, equal to the applicable percentage of the principal amount of each
Note sold by the Company as a result of a solicitation made by such Agent as set
forth in Schedule A hereto.
(c) Administrative Procedures. The purchase price, interest rate or
formula, maturity date and other terms of the Notes (as applicable) specified in
Exhibit A hereto shall be agreed upon by the Company and the applicable Agent or
Agents and specified in a pricing supplement to the Prospectus (each, a "Pricing
Supplement") to be prepared in connection with each sale of Notes. Except as may
be otherwise specified in the applicable Pricing Supplement, the Notes will be
issued in denominations of U.S. $100,000 or any larger amount that is an
integral multiple of U.S. $1,000. Administrative procedures with respect to the
sale of Notes shall be agreed upon from time to time by the Agents, the Company
and the Trustee (the "Procedures"). The Agents and the Company agree to perform,
and the Company agrees to cause the Trustee to agree to perform, their
respective duties and obligations specifically provided to be performed by them
in the Procedures.
SECTION 4. Covenants of the Company.
The Company covenants with each Agent as follows:
(a) Notice of Certain Events. The Company will notify the Agents
immediately, and confirm the notice in writing, (i) of the effectiveness of any
amendment to the Registration Statement, (ii) of the transmittal to the SEC for
filing of any amendment or supplement to the Prospectus or any document to be
filed pursuant to the 1934 Act which will be incorporated by reference in the
Prospectus, (iii) of the receipt of any comments from the SEC with respect to
the Registration Statement or the Prospectus,
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(iv) of any request by the SEC for any amendment to the Registration Statement
or any amendment or supplement to the Prospectus or for additional information,
and (v) of the issuance by the SEC of any stop order suspending the
effectiveness of the Registration Statement or the initiation of any proceedings
for that purpose. The Company will make every reasonable effort to prevent the
issuance of any stop order and, if any stop order is issued, to obtain the
lifting thereof at the earliest possible moment. In addition, the Company will
notify the Agents if the rating assigned by any nationally recognized
statistical rating organization to the Program or any debt securities of the
Company shall have been changed, or if any such rating organization shall have
publicly announced that it has under surveillance or review, with possible
negative implications, its rating of the Program or any debt securities of the
Company or shall have withdrawn the rating of the Program or any debt securities
of the Company, promptly after learning of any such event.
(b) Notice of Certain Proposed Filings. Except as otherwise provided in
subsection (j) of this Section 4, the Company will give the Agents advance
notice of its intention to file or prepare any additional registration statement
with respect to the registration of additional Notes, any amendment to the
Registration Statement or any amendment or supplement to the Prospectus (other
than a Pricing Supplement), whether by the filing of documents pursuant to the
1934 Act, the 1933 Act or otherwise, and will furnish to the Agents copies of
any such amendment or supplement or other documents a reasonable time in advance
of such filing or use.
(c) Copies of the Registration Statement and the Prospectus. The Company
will deliver to each Agent one (1) signed and as many conformed copies of the
Registration Statement (as originally filed) and of each amendment thereto
(including exhibits filed therewith or incorporated by reference therein and
documents incorporated by reference in the Prospectus) as the Agents may
reasonably request. The Company will furnish to the Agents as many copies of the
Prospectus (as amended or supplemented) as the Agents shall reasonably request
so long as the Agents are required to deliver a Prospectus in connection with
sales or solicitations of offers to purchase the Notes.
(d) Revisions of Prospectus -- Material Changes. Except as otherwise
provided in subsection (j) of this Section 4, if any event shall occur or
condition exist as a result of which it is necessary, in the opinion of counsel
for the Agents or counsel for the Company, to further amend or supplement the
Prospectus in order that the Prospectus will not include an untrue statement of
a material fact or omit to state any material fact necessary in order to make
the statements therein not misleading in the light of the circumstances existing
at the time it is delivered to a purchaser, or if it shall be necessary, in the
opinion of either such counsel, to amend or supplement the Registration
Statement or the Prospectus in order to comply with the requirements of the
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1933 Act or the 1933 Act Regulations, the Company shall give immediate notice,
confirmed in writing, to the Agents to cease the solicitation of offers to
purchase the Notes in their capacity as agents and to cease sales of any Notes
the Agents may then own as principals, and the Company will promptly prepare and
file with the SEC such amendment or supplement, whether by filing documents
pursuant to the 1934 Act, the 1933 Act or otherwise, as may be necessary to
correct such untrue statement or omission or to make the Registration Statement
and Prospectus comply with such requirements.
(e) Periodic Financial Information. Except as otherwise provided in
subsection (j) of this Section 4, on the date on which there shall be released
to the general public interim financial statement information related to the
Company with respect to each of the first three quarters of any fiscal year or
preliminary financial statement information with respect to any fiscal year, the
Company shall furnish such information to the Agents, confirmed in writing.
(f) Prospectus Revisions -- Audited Financial Information. Except as
otherwise provided in subsection (j) of this Section, on the date on which there
shall be released to the general public financial information included in or
derived from the audited financial statements of the Company for the preceding
fiscal year, the Company shall furnish such information to the Agents, confirmed
in writing.
(g) Earnings Statements. The Company will make generally available to its
security holders as soon as practicable, but not later than 90 days after the
close of the period covered thereby, an earnings statement (in form complying
with the provisions of Rule 158 under the 1933 Act) covering each twelve month
period beginning, in each case, not later than the first day of the Company's
fiscal quarter next following the "effective date" (as defined in such Rule 158)
of the Registration Statement with respect to each sale of Notes.
(h) Blue Sky Qualifications. The Company will endeavor, in cooperation
with the Agents, to qualify the Notes for offering and sale under the applicable
securities laws of such states and other jurisdictions of the United States as
the Agents may designate, and will maintain such qualifications in effect for as
long as may be required for the distribution of the Notes; provided, however,
that the Company shall not be obligated to file any general consent to service
of process or to qualify as a foreign corporation in any jurisdiction in which
it is not so qualified. The Company will file such statements and reports as may
be required by the laws of each jurisdiction in which the Notes have been
qualified as provided above. The Company will promptly advise the Agents of the
receipt by the Company of any notification with respect to the suspension of the
qualification of the Notes for sale in any such state or jurisdiction or the
initiation or threatening of any proceeding for such purpose.
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(i) 1934 Act Filings. The Company, during the period when the Prospectus
is required to be delivered under the 1933 Act or the 1934 Act in connection
with sales of the Notes, will file all documents required to be filed with the
SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the 1934 Act within the
time periods prescribed by the 1934 Act and the 1934 Act Regulations.
(j) Suspension of Certain Obligations. The Company shall not be required
to comply with the provisions of subsections (b), (d), (e) or (f) of this
Section 4 or of subsections (a), (b), (c) or (d) of Section 7 during any period
from the time the Agents shall have suspended solicitation of purchases of the
Notes in their capacity as agents pursuant to a request from the Company to
cease such solicitations, until such time as the Company notifies the Agents
that solicitation of purchases of the Notes should be resumed; provided,
however, that compliance with such subsections shall be required for any portion
of such period during which any Agent has notified the Company that it holds any
Notes purchased hereunder as principal pursuant hereto.
(k) Preparations of Pricing Supplements. The Company will prepare, with
respect to any Notes to be sold to or through one or more Agents pursuant to
this Agreement, a Pricing Supplement with respect to such Notes in a form
previously approved by the Agents and will file such Pricing Supplement pursuant
to Rule 424(b)(3) under the 1933 Act not later than the close of business of the
SEC on the third business day after the date on which such Pricing Supplement is
first used.
(l) Stand-Off Agreement. If specified by the applicable Agent or Agents in
connection with a purchase of Notes from the Company as principal, between the
date of the agreement to purchase such Notes and the Settlement Date with
respect to such purchase, the Company will not, without the prior written
consent of such Agent or Agents, offer or sell, grant any option for the sale
of, or enter into any agreement to sell, any debt securities of the Company
(other than the Notes that are to be sold pursuant to such agreement or
commercial paper and borrowings under bank lines of credit in the ordinary
course of business).
SECTION 5. Conditions of Obligations.
The obligations of the Agents to purchase Notes from the Company as
principal and to solicit offers to purchase Notes as agents of the Company, and
the obligations of any purchaser of Notes sold through an Agent as agent, will
be subject at all times to the accuracy of the representations and warranties on
the part of the Company herein contained and to the accuracy of the statements
of the Company's officers made in any certificate furnished pursuant to the
provisions hereof, to the performance and observance by the Company of all its
covenants and agreements herein contained and to the following additional
conditions precedent:
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(a) At the date hereof, the Agents shall have received a certificate,
dated the date hereof, of the Company signed by its President or one
of its Vice Presidents and the Treasurer or an Assistant Treasurer of
the Company, substantially in the form thereof attached as Appendix I
hereto.
(b) At the date hereof, the Agents shall have received opinions, dated the
date hereof, of LeBoeuf, Lamb, Greene & MacRae, L.L.P., counsel for
the Company, and Brown & Wood LLP, counsel for the Agents,
substantially in the forms thereof attached hereto as Appendix II and
III, respectively, with reproduced or conformed copies thereof for
each of the Agents.
(c) At the date hereof, the Agents shall have received a letter, dated the
date hereof, from Arthur Andersen LLP, substantially to the effect set
forth in Appendix IV hereto, with reproduced or conformed copies
thereof for each of the Agents.
(d) At the date hereof, Brown & Wood LLP, counsel for the Agents, shall
have been furnished with such documents and opinions as they may
require for the purpose of enabling them to pass upon the issuance and
sale of the Notes and the issuance and delivery of the Class A Bonds
as herein contemplated and related proceedings, or in order to
evidence the accuracy or completeness of any of the representations or
warranties, or the fulfillment of any of the conditions herein
contained; and all proceedings taken by the Company in connection with
the issuance and sale of the Notes and the issuance and delivery of
the Class A Bonds as herein contemplated shall be satisfactory in form
and substance to the Agents and Brown & Wood LLP.
SECTION 6. Delivery of and Payment for Notes Sold through an Agent.
Delivery of Notes sold through an Agent as agent shall be made by the
Company to such Agent for the account of any purchaser only against payment
therefor in immediately available funds. In the event that a purchaser shall
fail either to accept delivery of or to make payment for a Note on the date
fixed for settlement, such Agent shall promptly notify the Company and deliver
such Note to the Company and, if such Agent has theretofore paid the Company for
such Note, the Company will promptly return such funds to such Agent. If such
failure occurred for any reason other than default by such Agent in the
performance of its obligations hereunder, the Company will reimburse such Agent
on an equitable basis for its loss of the use of the funds for the period such
funds were credited to the
-14-
Company's account but in no event shall the Company be required to pay such
Agent any commission with respect to such Note.
SECTION 7. Subsequent Documentation Requirements of the Company.
The Company covenants and agrees that:
(a) Subsequent Delivery of Certificates. Each time that (i) the
Registration Statement or the Prospectus shall be amended or supplemented (other
than by a Pricing Supplement and other than by an amendment or supplement which
relates exclusively to the issuance and/or offering of securities other than the
Notes), (ii) there is filed with the SEC any document incorporated by reference
into the Prospectus (other than any Current Report on Form 8-K relating
exclusively to the issuance and/or offering of securities other than the Notes,
unless an Agent shall otherwise specify), or (iii) (if required by an Agent in
connection with the purchase of Notes from the Company by one or more Agents as
principal) the Company sells Notes to such Agent or Agents as principal, the
Company shall furnish or cause to be furnished to the Agents forthwith a
certificate dated the date of filing with the SEC of such supplement or
document, the date of effectiveness of such amendment, or the date of such sale,
as the case may be, in form satisfactory to the Agents, to the effect that the
statements contained in the certificate referred to in Section 5(a) hereof which
were last furnished to the Agents are true and correct at the time of such
amendment, supplement, filing or sale, as the case may be, as though made at and
as of such time (except that such statements shall be deemed to relate to the
Registration Statement and the Prospectus as amended and supplemented to such
time) or, in lieu of such certificate, a certificate of the same tenor as the
certificate referred to in said Section 5(a) hereof, modified as necessary to
relate to the Registration Statement and the Prospectus as amended and
supplemented to the time of delivery of such certificate.
(b) Subsequent Delivery of Legal Opinions. Each time that (i) the
Registration Statement or the Prospectus shall be amended or supplemented (other
than by a Pricing Supplement or an amendment or supplement providing solely for
the inclusion of additional financial information, and other than by an
amendment or supplement which relates exclusively to an offering of debt
securities other than the Notes), (ii) there is filed with the SEC any document
incorporated by reference into the Prospectus (other than any Current Report on
Form 8-K or Quarterly Report on Form 10-Q, unless an Agent shall otherwise
reasonably request), or (iii) (if required by an Agent in connection with the
purchase of Notes from the Company by one or more Agents as principal) the
Company sells Notes to such Agent or Agents as principal, the Company shall
furnish or cause to be furnished forthwith to the Agents and to counsel to the
Agents a written opinion of LeBoeuf, Lamb, Greene & MacRae, L.L.P., counsel to
the Company, dated the date of filing with the SEC of such supplement or
document, the
-15-
date of effectiveness of such amendment, or the date of such sale, as the case
may be, in form and substance satisfactory to the Agents, of the same tenor as
the opinion referred to in Section 5(b) hereof, but modified, as necessary, to
relate to the Registration Statement and the Prospectus as amended and
supplemented to the time of delivery of such opinion; or, in lieu of such
opinion, such counsel shall furnish the Agents with a letter substantially in
the form of Appendix V hereto to the effect that the Agents may rely on such
last opinion to the same extent as though it was dated the date of such letter
authorizing reliance (except that statements in such last opinion shall be
deemed to relate to the Registration Statement and the Prospectus as amended and
supplemented to the time of delivery of such letter authorizing reliance).
(c) Subsequent Delivery of Comfort Letters. Each time that (i) the
Registration Statement or the Prospectus shall be amended or supplemented to
include additional financial information, (ii) there is filed with the SEC any
document incorporated by reference into the Prospectus which contains additional
financial information, or (iii) (if required by an Agent in connection with the
purchase of Notes from the Company by one or more Agents as principal) the
Company sells Notes to such Agent or Agents as principal, the Company shall
cause Arthur Andersen LLP forthwith to furnish the Agents a letter, dated the
date of filing with the SEC of such supplement or document, the date of
effectiveness of such amendment, or the date of such sale, as the case may be,
in form satisfactory to the Agents, of the same tenor as the letter referred to
in Section 5(c) hereof but modified to relate to the Registration Statement and
Prospectus as amended and supplemented to the date of such letter, and with such
changes as may be necessary to reflect changes in the financial statements and
other information derived from the accounting records of the Company; provided,
however, that if the Registration Statement or the Prospectus is amended or
supplemented solely to include financial information as of and for a fiscal
quarter, Arthur Andersen LLP may limit the scope of such letter to the unaudited
financial statements included in such amendment or supplement unless any other
information included therein of an accounting, financial or statistical nature
is of such a nature that, in the reasonable judgment of the Agents, such letter
should cover such other information.
(d) Subsequent Delivery of Documents Pursuant to the Indenture. Each time
that the Company shall deliver documents to the Trustee pursuant to Article IV
of the Indenture with respect to the Notes or Article III of the PSCo 1939
Mortgage (as defined in the Indenture) with respect to Class A Bonds being
issued with respect to the Notes, the Company shall furnish or cause to be
furnished to the Agents and to counsel to the Agents a copy of such documents.
-16-
SECTION 8. Indemnification.
(a) Indemnification of the Agents. The Company agrees to indemnify and
hold harmless each Agent and each person, if any, who controls such Agent within
the meaning of Section 15 of the 1933 Act against any and all losses, claims,
damages or liabilities, joint or several, to which they or any of them may
become subject under the 1933 Act or any other statute or common law and to
reimburse each such Agent and controlling person for any legal or other expenses
(including, subject to subparagraph (c) of this Section 8, reasonable counsel
fees) incurred by them, as incurred, in connection with any such losses, claims,
damages or liabilities or in connection with investigating or preparing for or
defending against any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or in connection with
effecting a settlement of any such litigation, investigation or proceeding (if
such settlement is effected with the written consent of the Company), insofar as
such losses, claims, damages, liabilities, expenses, litigation, investigations
or proceedings arise out of, or are based upon, an untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement, or
in any amendment thereto, or the omission or alleged omission therefrom of a
material fact required to be stated therein or necessary to make the statements
therein not misleading, or an untrue statement or alleged untrue statement of a
material fact included in the Prospectus, as it may have been or be amended or
supplemented, or the omission or alleged omission therefrom of a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided, however,
that the indemnity agreement contained in this subparagraph (a) shall not apply
to any such losses, claims, damages, liabilities, expenses, litigation,
investigations or proceedings arising out of, or based upon, any such untrue
statement or alleged untrue statement, or any such omission or alleged omission,
if such statement or omission was made in reliance upon and in conformity with
information furnished in writing to the Company by the Agents expressly for use
in the Prospectus, or any amendment or supplement thereto, or arising out of, or
based upon, any such untrue statement or alleged untrue statement in, or any
such omission or alleged omission from, the Trustee's Statement of Eligibility
under the 1939 Act filed as an exhibit to the Registration Statement; and
provided, further, that the indemnity agreement contained in this subparagraph
(a) shall not inure to the benefit of any Agent or of any person controlling
such Agent on account of any such loss, claim, damage, liability, expense,
litigation, investigation or proceeding arising from the sale of Notes to any
person if (i) such Agent shall have failed to send or give to such person (A)
with or prior to the written confirmation of such sale, a copy of the Prospectus
together with any amendments or supplements thereto which shall theretofore have
been furnished to such Agent, or (B) with or prior to the delivery of such Notes
to such person, a copy of any amendment or supplement to the Prospectus which
shall have been furnished to such Agent subsequent to such written confirmation
and prior to the delivery
-17-
of such Notes to such person, and (ii) in either such case, any untrue or
misleading statement or omission made or alleged to have been made shall have
been eliminated or remedied in the Prospectus or the amendment or supplement
thereto which such Agent so failed to send or give to such person and such Agent
would not have been liable had a copy of such Prospectus, amendment or
supplement, as the case may be, been so sent or given to such person. Each Agent
agrees promptly to notify the Company and each other Agent of the commencement
of any litigation, investigations or proceedings against it or any such
controlling person in connection with the issuance and sale of the Notes.
(b) Indemnification of the Company. Each Agent agrees to indemnify and
hold harmless the Company, its directors and officers, and each person who
controls the Company within the meaning of Section 15 of the 1933 Act against
any and all losses, claims, damages or liabilities, joint or several, to which
they or any of them may become subject under the 1933 Act or any other statute
or common law and to reimburse each of them for any legal or other expenses
(including, subject to subparagraph (c) of this Section 8, reasonable counsel
fees) incurred by them, as incurred, in connection with any such losses, claims,
damages or liabilities or in connection with investigating or preparing for or
defending against any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or in connection with
effecting a settlement of any such litigation, investigation or proceeding (if
such settlement is effected with the written consent of each Agent affected
thereby), insofar as such losses, claims, damages, liabilities, expenses,
litigations, investigations or proceedings arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact included in the
Prospectus, or any amendment or supplement thereto, or the omission or alleged
omission therefrom of a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, if such statement or omission was made in reliance upon and in
conformity with information furnished in writing to the Company by the Agents
expressly for use in the Prospectus, or any amendment or supplement thereto. The
Company agrees promptly to notify the Agents of the commencement of any
litigation, investigation or proceeding against it, any such director or
officer, or any such controlling person, in connection with the issuance and
sale of the Notes.
(c) General. The Company and the several Agents each agrees that, upon
receipt of notice of the commencement of any action against it or any director,
officer or person controlling the Company or any person controlling such Agent
as aforesaid, in respect of which indemnity may be sought on account of any
indemnity agreement contained herein, it will promptly give notice of the
commencement thereof to the party or parties against whom indemnity shall be
sought hereunder, but the omission so to notify such indemnifying party or
parties of any such action shall not relieve such indemnifying party or parties
from any liability which it or they may have to the indemnified
-18-
party otherwise than on account of such indemnity agreement. In case such notice
of any such action shall be so given, such indemnifying party shall be entitled
to participate at its own expense in the defense, or, if it so elects, to assume
(in conjunction with any other indemnifying parties) the defense, of such
action, in which event such defense shall be conducted by counsel chosen by such
indemnifying party or parties and satisfactory to the indemnified party or
parties who shall be defendant or defendants in such action. In no event shall
the indemnifying parties be liable for fees and expenses of more than one
counsel (in addition to one local counsel) separate from their own counsel for
all indemnified parties in connection with any one action or separate but
similar or related actions in the same jurisdiction arising out of the same
general allegations or circumstances. The indemnity agreements contained in this
Section 8 shall be in addition to any liability which the Company or the Agents
may otherwise have.
SECTION 9. Payment of Expenses.
The Company will pay all expenses incident to the performance of its
obligations under this Agreement, including:
(a) The preparation and filing of the Registration Statement and
all amendments thereto and the Prospectus and any amendments or
supplements thereto;
(b) The preparation, filing and reproduction of this Agreement;
(c) The preparation, printing, issuance and delivery of the
Notes, including any fees and expenses relating to the use of
book-entry notes;
(d) The fees and disbursements of the Company's accountants and
counsel, of the Trustee and its counsel, and of The Depository Trust
Company;
(e) The reasonable fees and disbursements of counsel to the
Agents incurred in connection with the establishment of the program
relating to the Notes and incurred from time to time in connection
with the transactions contemplated hereby;
(f) The qualification of the Notes under state securities or
"Blue Sky" laws in accordance with the provisions of Section 4(h)
hereof, including filing fees and the reasonable fees and
disbursements of counsel to the Agents in connection therewith and in
connection with the preparation of any Blue Sky Survey and any Legal
Investment Survey, and the printing and delivery to the Agents of
copies of any Blue Sky Survey and any Legal Investment Survey;
-19-
(g) The printing and delivery to the Agents in quantities as
hereinabove stated of copies of the Registration Statement and any
amendments thereto, and of the Prospectus and any amendments or
supplements thereto, and the delivery by the Agents of the Prospectus
and any amendments or supplements thereto in connection with
solicitations or confirmations of sales of the Notes;
(h) The preparation, printing and delivery to the Agents of
copies of the Indenture and all supplements and amendments thereto;
(i) Any fees charged by rating agencies for the rating of the
Notes;
(j) The fees and expenses incurred in connection with the listing
of the Notes on any securities exchange;
(k) The fees and expenses, if any, incurred with respect to any
filing with the National Association of Securities Dealers, Inc.;
(l)The cost of providing any CUSIP or other identification
numbers for the Notes; and
(m) Any reasonable out-of-pocket expenses incurred by the Agents
in connection with this Agreement, provided that the Agents have
notified the Company of any such expenses prior to incurring such
expenses.
SECTION 10. Representations, Warranties and Agreements to
Survive Delivery.
All representations, warranties and agreements contained in this Agreement
or in certificates of officers of the Company submitted pursuant hereto, shall
remain operative and in full force and effect, regardless of any investigation
made by or on behalf of the Agents or any controlling person of an Agent, or by
or on behalf of the Company, and shall survive each delivery of and payment for
any of the Notes.
SECTION 11. Termination.
(a) Termination of this Agreement. This Agreement (excluding any agreement
by one or more Agents to purchase Notes from the Company as principal) may be
terminated for any reason, at any time by either the Company or an Agent with
respect to such Agent upon the giving of 30 days' written notice of such
termination to the other parties hereto.
(b) Termination of Agreement to Purchase Notes as
Principal. An Agent or Agents may terminate any agreement by
such Agent or Agents to purchase Notes from the Company as
-20-
principal, immediately upon notice to the Company, at any time prior to the
Settlement Date relating thereto, if:
(i) (A) the Company shall have failed or refused to perform any
covenant or agreement on its part to be performed hereunder at
or prior to the Settlement Date, or (B) the conditions
specified in Section 5 hereof shall not have been fulfilled;
(ii) the subject matter of the Prospectus or of any amendment or
supplement to the Prospectus (other than an amendment or
supplement relating solely to the activities of any Agent or
Agents), in the reasonable judgment of such Agent, shall have
made it impracticable for such Agent to market the Notes, or
to enforce contracts for the sale of the Notes, upon the terms
specified in the Prospectus;
(iii) (A) there shall have occurred any outbreak or escalation of
hostilities or other national or international calamity or
crisis, (B) trading in the Common Stock of the Company shall
have been suspended by the SEC or any national securities
exchange, or trading generally on the New York Stock Exchange
shall have been suspended, or minimum or maximum prices for
trading shall have been fixed, or maximum ranges for prices
for securities shall have been required on said exchange or by
order of the SEC or any other governmental authority having
jurisdiction, or (C) a banking moratorium shall have been
declared by either Federal or New York State authorities, in
any such case with the result that, in the reasonable judgment
of such Agent, it shall be impracticable for such Agent to
market the Notes, or to enforce contracts for the sale of the
Notes, upon the terms specified in the Prospectus; or
(iv) the rating assigned by Moody's Investors Service, Inc. or
Standard & Poor's Ratings Service to the Program or any debt
securities of the Company as of the date of such agreement to
purchase Notes from the Company as principal shall have been
lowered since such date or Moody's Investors Service, Inc. or
Standard & Poor's Ratings Service shall have informed the
Company or publicly announced that it has under surveillance
or review, with possible negative implications, its rating of
the Program or any debt securities of the Company or shall
have withdrawn its rating of the Program or any debt
securities of the Company.
(c) General. In the event of any such termination, no party will have any
liability in respect of this Agreement or such agreement to purchase Notes from
the Company as principal, as the case may be, to the other parties hereto or
thereto,
-21-
except that (i) the Agents shall be entitled to any commissions earned in
accordance with the third paragraph of Section 3(b) hereof, (ii) if at the time
of termination (a) any Agent shall own any Notes purchased by it hereunder as
principal with the intention of reselling them and shall so notify the Company
or (b) an offer to purchase any of the Notes has been accepted by the Company
but the time of delivery to the purchaser or his agent of the Note or Notes
relating thereto has not occurred, the covenants set forth in Sections 4 and 7
hereof shall remain in effect until such Notes are so resold or delivered, as
the case may be, (iii) the covenant set forth in Section 4(g) hereof, the
indemnity agreement set forth in Section 8 hereof, and the provisions of
Sections 10, 13 and 14 hereof shall remain in effect and (iv) if such
termination is pursuant to subsection (a), (b)(i), (b)(ii) or (b)(iv) of this
Section 11, the Company shall reimburse the expenses of the Agents and their
counsel to the extent provided in Section 9.
SECTION 12. Notices.
Unless otherwise provided herein, all notices required under the terms and
provisions hereof shall be in writing, either delivered by hand, by mail, by
telegram or by facsimile (confirmed by telephone), and any such notice shall be
effective when received at the address specified below.
If to the Company:
Public Service Company of Colorado
1225 17th Street
Denver, Colorado 80202
Attention:
Facsimile:
Telephone:
If to the Agents:
Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
World Financial Center
North Tower, 10th Floor
New York, New York 10281-1310
Attention: MTN Product Management
Facsimile: (212) 449-2234
Telephone:
Goldman, Sachs & Co.
85 Broad Street
New York, New York 10004
Attention: Credit Control - Medium-Term Notes
Facsimile: (212) 357-8680
Telephone: (212) 902-3711
-22-
or at such other address as such party may designate from time to time by notice
duly given in accordance with the terms of this Section 12.
SECTION 13. Parties.
This Agreement shall inure to the benefit of and be binding upon each
Agent and the Company and their respective successors. Nothing expressed or
mentioned in this Agreement is intended or shall be construed to give any
person, firm or corporation, other than the parties hereto and their respective
successors and the controlling persons and officers and directors referred to in
Section 8 and their heirs and legal representatives, any legal or equitable
right, remedy or claim under or in respect of this Agreement or any provision
herein contained. This Agreement and all conditions and provisions hereof are
intended to be for the sole and exclusive benefit of the parties hereto and
their respective successors and said controlling persons and officers and
directors and their heirs and legal representatives, and for the benefit of no
other person, firm or corporation. No purchaser of Notes shall be deemed to be a
successor by reason merely of such purchase.
SECTION 14. Governing Law.
This Agreement and all the rights and obligations of the parties created
hereby shall be governed by and construed in accordance with the laws of the
State of New York applicable to agreements made and to be performed in such
State.
SECTION 15. Counterparts.
This Agreement may be executed in one or more counterparts and, if
executed in more than one counterpart, the executed counterparts hereof shall
constitute a single instrument.
-23-
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company a counterpart hereof, whereupon
this instrument along with all counterparts will become a binding agreement
among the Agents and the Company in accordance with its terms.
Very truly yours,
PUBLIC SERVICE COMPANY OF COLORADO
By________________________________
Title:
CONFIRMED AND ACCEPTED, as of the date
first above written:
MERRILL LYNCH, PIERCE FENNER & SMITH
INCORPORATED
By__________________________________
Name:
Title:
GOLDMAN, SACHS & CO.
____________________________________
(Goldman, Sachs & Co.)
-24-
EXHIBIT A
The following terms, if applicable, shall be agreed to by one or more
Agents and the Company in connection with each sale of Notes:
Principal Amount: $________
Interest Rate:
Default Rate:
Interest Payment Dates:
If Redeemable at the option of the Company:
Initial Redemption Date:
Initial Redemption Percentage:
Annual Redemption Percentage Reduction, if any:
If Repayable at the option of Holders:
Repayment Date(s):
Repayment Price:
Original Issue Date:
Date of Maturity:
Authorized Denomination:
Purchase Price: ___%, plus accrued interest, if any,
from ____________
Settlement Date and Time:
Additional Terms:
In connection with the purchase of Notes from the Company by one or more
Agents as principal, agreement as to whether the following will be required:
Officer's Certificate pursuant to Section 7(a) of the Distribution
Agreement.
Legal Opinions pursuant to Section 7(b) of the Distribution Agreement.
Comfort Letter pursuant to Section 7(c) of the Distribution Agreement.
Stand-off Agreement pursuant to Section 4(l) of the Distribution
Agreement.
-1-
Schedule A
As compensation for the services of the Agents hereunder, the Company
shall pay the applicable Agent, on a discount basis, a commission for the sale
of each Note equal to the principal amount of such Note multiplied by the
appropriate percentage set forth below:
Percent of
Maturity Ranges Principal Amount
--------------- ----------------
From 9 months to less than 1 year . . . . . . . .125%
From 1 year to less than 18 months . . . . . . . .150%
From 18 months to less than 2 years . . . . . . .200%
From 2 years to less than 3 years . . . . . . . .250%
From 3 years to less than 4 years . . . . . . . .350%
From 4 years to less than 5 years . . . . . . . .450%
From 5 years to less than 6 years . . . . . . . .500%
From 6 years to less than 7 years . . . . . . . .550%
From 7 years to less than 10 years . . . . . . . .600%
From 10 years to less than 15 years . . . . . . .625%
From 15 years to less than 20 years . . . . . . .700%
From 20 years to 30 years . . . . . . . . . . . .750%
-1-
APPENDIX I
FORM OF OFFICER'S CERTIFICATE
-----------------------------
PUBLIC SERVICE COMPANY OF COLORADO
We, [authorized officers' names], [the President] [a Vice President] and
[the Treasurer] [an Assistant Treasurer] respectively, of Public Service Company
of Colorado, a Colorado corporation (the "Company"), pursuant to Section 5(a) of
the Distribution Agreement dated _____________ (the "Distribution Agreement")
among the Company and [Agents], hereby certify that, to the best of our
knowledge, after reasonable investigation:
1. Since the respective dates as of which information is given in the
Registration Statement and Prospectus (as such terms are defined in the
Distribution Agreement), except as otherwise stated therein or contemplated
thereby, [or since [insert date of applicable agreement by an Agent to purchase
Notes from the Company as principal]], there has not been any material adverse
change in the business, property or condition, financial or otherwise, of the
Company and its subsidiaries considered as one enterprise, whether or not
arising in the ordinary course of business;
2. The representations and warranties of the Company contained in Section 2
of the Distribution Agreement are true and correct with the same force and
effect as though expressly made at and as of the date hereof;
3. The Company has performed or complied with all agreements and satisfied
all conditions on its part to be performed or satisfied at or prior to the date
hereof; and
4. No stop order suspending the effectiveness of the Registration Statement
has been issued and no proceeding for that purpose has been initiated or
threatened by the Securities and Exchange Commission.
I-1
IN WITNESS WHEREOF, we have hereunto signed our names and affixed the seal
of the Company.
Dated: _____________, ____
________________________________
[Title]
[SEAL]
________________________________
[Title]
I-2
Appendix II
to
Distribution
Agreement
[LETTERHEAD OF LEBOEUF, LAMB, GREENE & MACRAE, L.L.P.]
[Agents]
Ladies and Gentlemen:
We have acted as counsel to Public Service Company of Colorado (the
"Company") in connection with the sale by the Company of up to $250,000,000
aggregate principal amount of its Secured Medium-Term Notes, Series B (being a
series of First Collateral Trust Bonds) (the "Notes"), which are registered
pursuant to the registration statement (File No. 333-____) of the Company for
the registration under the Securities Act of 1933, as amended (the "1933 Act"),
of up to $400,000,000 in aggregate principal amount of its First Collateral
Trust bonds, including the Notes. This opinion is being delivered to you
pursuant to Section 5(b) of the Distribution Agreement, dated _______ (the
"Agreement"), between the Company and the several agents named therein (the
"Agents"). Unless otherwise stated, defined terms used herein shall have the
respective meanings given them in the Agreement.
We are not general counsel to the Company and our representation of the
Company consists of advising it with respect to corporate and regulatory matters
as to which we have been specifically consulted. We are familiar with the legal
matters pertaining to, and the corporate proceedings of the Company taken with
respect to, the authorization of the issuance and sale by the Company of the
Notes and the authorization of the issuance and delivery of the Class A Bonds.
We have examined, among other things, the Registration Statement and the
Prospectus, and any amendment or supplement thereto, the corporate records of
the Company, the Indenture, the Supplemental Indenture creating the Notes, the
PSCO 1939 Mortgage and the supplemental indenture thereto (the "1939
Supplemental Mortgage") under which the Class A Bonds are being issued, the
proceedings before The Public Utilities Commission of the State of Colorado with
respect to the issuance and sale of the Notes and the issuance and delivery of
the Class A Bonds and such other proceedings, papers and documents as we have
deemed relevant for the purpose of rendering the opinions enumerated below. In
such examination, we have assumed the genuineness of all signatures, the
authenticity of all documents submitted to us as originals, the conformity to
the original documents of all documents submitted to us as copies and the
authenticity of all such latter documents. We have relied as to various
questions of fact upon discussions with officers and representatives of the
Company and the representations and warranties of the Company contained in the
Agreement and upon the certificates of public officials and of officers of the
Company being delivered to you thereunder. With respect to the opinions
expressed in paragraphs (xii), (xiii) and (xiv) below, we have relied on
information obtained from public records and from the Company.
On the basis of the foregoing, and subject to the limitations and
qualifications set forth herein, it is our opinion that:
(i) The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Colorado
with corporate power and authority to own, lease and operate its
properties and to conduct its business as described in the Prospectus,
as amended or supplemented to the date hereof.
(ii) To the best of our knowledge, the Company is duly qualified as a
foreign corporation to transact business and is in good standing in
each jurisdiction in which such qualification is required, whether by
reason of the ownership or leasing of property or the conduct of
business, except where the failure to so qualify or be in good
standing would not have a material adverse effect on the business,
properties or operations of the Company and its subsidiaries
considered as one enterprise.
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(iii)Each Significant Subsidiary of the Company (as defined in Rule 405(c)
of Regulation C under the 1933 Act), if any, has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of the jurisdiction of its incorporation, has corporate
power and authority to own, lease and operate its properties and
conduct its business as described in the Registration Statement and
the Prospectus, as amended or supplemented to the date hereof, and, to
the best of our knowledge, is duly qualified as a foreign corporation
to transact business and is in good standing in each jurisdiction in
which such qualification is required, whether by reason of the
ownership or leasing of property or the conduct of business, except
where the failure to so qualify or be in good standing would not have
a material adverse effect on the business, properties or operations of
the Company and its subsidiaries considered as one enterprise.
(iv) To the best of our knowledge, the Company is not in violation of its
charter or by-laws or in default in the performance or observance of
any material obligation, agreement, covenant or condition contained in
any contract, indenture, mortgage, loan agreement, note, lease or
other instrument to which it is a party or by which it or any of its
properties may be bound. The execution and delivery of the Agreement,
the Supplemental Indenture, the 1939 Supplemental Mortgage and the
consummation of the transactions contemplated therein and the
incurrence of the obligations therein contained will not conflict
with, or constitute a breach of, or default under, or (other than
under the Indenture and the 1939 Mortgage) result in the creation or
imposition of any lien, charge or encumbrance upon any property or
assets of the Company pursuant to, any contract, indenture, mortgage,
loan agreement, note, lease or other instrument known to us and to
which the Company is a party or by which it may be bound or to which
any of its property or assets is subject, or any law, administrative
regulation or administrative or court order or decree known to us to
be applicable to the Company of any court or governmental agency,
authority or body or any arbitrator having jurisdiction over the
Company; nor will such action result in any violation of the
provisions of the charter or by-laws of the Company.
(v) The Indenture has been duly and validly authorized, executed and
delivered by the Company and is in due and proper form and (assuming
the Indenture has been duly authorized, executed and delivered by the
Trustee) constitutes a legal, valid and binding mortgage of the
Company, enforceable in accordance with its terms, except as
enforcement thereof may be limited by laws and principles of equity
affecting generally the enforcement of mortgagees' and other
creditors' rights, including without limitation bankruptcy and
insolvency laws and state laws which affect the enforcement of certain
remedial provisions of the Indenture; provided, however, that such
state laws will not, in our opinion, render the remedies afforded by
the Indenture inadequate for the practical realization of the benefit
of the security provided thereby.
(vi) The Indenture is qualified under the Trust Indenture Act of 1939, as
amended.
(vii) The Notes are in due and proper form and the issuance and sale of the
Notes have been duly authorized by all necessary corporate action, and
when a Note has been duly executed and authenticated as specified in
the Indenture and the Company Order and Officer's Certificate (each as
defined in the Indenture) applicable to such Note and delivered
against payment of the consideration therefor determined in accordance
with the Agreement, such Note will be a legal, valid and binding
obligation of the Company enforceable (subject to the exceptions and
limitations referred to in paragraph (v) hereof) in accordance with
its terms and entitled to the benefits and security of the Indenture;
and, assuming that the Supplemental Indenture has been duly
transmitted to the appropriate public officials for recording and will
be duly recorded, such Note will be secured equally and ratably with
all other Notes and bonds outstanding under the Indenture.
(viii) The PSCO 1939 Mortgage has been duly and validly authorized, executed
and delivered by the Company and is in due and proper form and
(assuming the PSCO 1939 Mortgage has been duly authorized, executed
and delivered by the trustee thereunder) constitutes a legal, valid
and binding mortgage of the Company, enforceable in accordance with
its terms, except as enforcement thereof may be limited by laws and
principles of equity affecting generally the enforcement of
mortgagees'
B-2
and other creditors' rights, including without limitation bankruptcy
and insolvency laws and state laws which affect the enforcement of
certain remedial provisions of the PSCO 1939 Mortgage; provided,
however, that such state laws will not, in our opinion, render the
remedies afforded by the PSCO 1939 Mortgage inadequate for the
practical realization of the benefit of the security provided thereby.
(ix) The Class A Bonds are in due and proper form and the issuance and
delivery of the Class A Bonds have been duly authorized by all
necessary corporate action; and when (a) a Class A Bond has been duly
executed, authenticated and delivered to the Trustee as specified in
the PSCO 1939 Mortgage and the order of an officer of the Company
applicable to such Class A Bond and (b) the related Note has been duly
executed and authenticated as specified in the Indenture and the
Company Order and Officer's Certificate applicable to such Note and
delivered against payment of the consideration therefor determined in
accordance with the Agreement, such Class A Bond will be a legal,
valid and binding obligation of the Company enforceable (subject to
the exceptions and limitations referred to in paragraph (viii) hereof)
in accordance with its terms and entitled to the benefits and security
of the PSCO 1939 Mortgage; and, assuming that the 1939 Supplemental
Mortgage has been duly transmitted to the appropriate public officials
for recording and will be duly recorded, such Class A Bond will be
secured equally and ratably with all other bonds outstanding under the
PSCO 1939 Mortgage (except to the extent that any sinking,
amortization, improvement or other fund may afford additional security
for such bonds of any particular series).
(x) The Agreement has been duly authorized, executed and delivered by the
Company.
(xi) The issuance and sale of the Notes, and the issuance and delivery of
the Class A Bonds, have been duly authorized and approved by an order
of The Public Utilities Commission of the State of Colorado and such
order is final and in full force and effect on the date hereof, the
time for appeal therefrom or review thereof or intervention with
respect thereto having expired; no further approval, authorization,
consent or other order of any public board or body (other than in
connection or compliance with the provisions of the securities laws of
any jurisdiction) is legally required for the issuance and sale by the
Company of the Notes pursuant to the Agreement or for the issuance and
delivery of the Class A Bonds; and the Company is presently exempt
from all of the provisions of the Public Utility Holding Company Act
of 1935, as amended, except Section 9(a)(2) thereof.
xii) The Company has good title to the real properties specifically or
generally described or referred to in the Indenture and in the PSCO
1939 Mortgage as subject to the respective liens thereof (except such
real property as may have been sold, exchanged or otherwise disposed
of), subject only to (a) in the case of all such properties, the lien
of the PSCO 1939 Mortgage and "permitted encumbrances" (as defined in
the PSCO 1939 Mortgage) and (b) in the case of such properties which
are used or to be used in or in connection with the Electric Utility
Business (as defined in the Indenture) (whether or not such is the
sole use of such property) the lien of the Indenture and Permitted
Liens (as defined in the Indenture).
(xiii) The Indenture constitutes a mortgage lien on the properties
specifically or generally described or referred to therein as subject
to the lien thereof (except such properties as may have been sold,
exchanged or otherwise disposed of or released from the lien thereof
in accordance with the terms thereof), subject to no liens prior to
the lien of the Indenture other than Permitted Liens and the lien of
the PSCO 1939 Mortgage; and the Indenture by its terms effectively
subjects to the lien thereof all property (except property of the
kinds specifically excepted from the lien of the Indenture by the
terms thereof) acquired by the Company after the date of execution and
delivery of the Indenture and used or to be used in or in connection
with the Electric Utility Business, subject to Permitted Liens, the
lien of the PSCO 1939 Mortgage, any lien thereon existing at the time
of such acquisition and to any liens for unpaid portions of the
purchase money placed thereon at the time of such acquisition, and
also subject to the provisions of Article Thirteen of the
B-3
Indenture and to certain possible claims of a trustee in bankruptcy
and possible claims and taxes of the federal government.
(xiv) The PSCO 1939 Mortgage constitutes a first mortgage lien on the
properties specifically or generally described or referred to therein
as subject to the lien thereof, including the shares of stock pledged
thereunder (except such property as may have been sold, exchanged or
otherwise disposed of or released from the lien thereof in accordance
with the terms thereof), subject to no liens prior to the lien of the
PSCO 1939 Mortgage other than "permitted encumbrances"; and the PSCO
1939 Mortgage by its terms effectively subjects to the lien thereof
all property (except property of the kinds specifically excepted from
the lien of the PSCO 1939 Mortgage by the terms thereof) acquired by
the Company after the date of the execution and delivery of the PSCO
1939 Mortgage, subject to "permitted encumbrances", to any lien
thereon existing at the time of such acquisition and to any liens for
unpaid portions of the purchase money placed thereon at the time of
such acquisition, and also subject to the provisions of Article XI of
the PSCO 1939 Mortgage and to certain possible claims of a trustee in
bankruptcy and possible claims and taxes of the federal government.
(xv) The facsimile signature of a Senior Vice President or Vice President
of the Company in lieu of his manual signature on the Notes and the
Class A Bonds and the facsimile signature of the Secretary or an
Assistant Secretary of the Company attesting the corporate seal in
lieu of his manual signature on the Notes and the Class A Bonds have
been duly and properly authorized by the Board of Directors of the
Company, are not inconsistent with the provisions of the Restated
Articles of Incorporation, as amended, or By-Laws of the Company and
are valid and effective under the laws of the State of Colorado; and
the facsimile signatures of such officers on the Notes and the Class A
Bonds have the same legal effect as though they had manually signed
and attested the Notes and the Class A Bonds as such respective
officers.
(xvi) The statements in the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1995, incorporated by reference into
the Prospectus, under the headings "Regulation and Rates" and
"Franchises" in Item 1. BUSINESS and under the heading "Character of
Ownership" in Item 2. Properties, and the statements in the
Prospectus, and any amendment or supplement thereto, under the caption
"Security" under "Description of the New Bonds" and "Description of
the 1939 Mortgage," insofar as they are, or refer to, statements of
law or legal conclusions, have been prepared or reviewed by us and are
correct in all material respects and fairly present the information
purported to be given. The Notes, the Indenture, the Class A Bonds and
the PSCO 1939 Mortgage conform as to legal matters to the descriptions
thereof contained in the Registration Statement and Prospectus, as
amended or supplemented to the date hereof.
(xvii) [Except to the extent set forth in the next sentence of this
paragraph (xvii),] the franchises held by the Company and its
subsidiaries, together with the applicable Certificates of Convenience
and Necessity issued by The Public Utilities Commission of the State
of Colorado and the Public Service Commission of Wyoming, give the
Company and such subsidiaries all necessary authority for the
maintenance and operation of their respective properties and business
as now conducted, and are free from burdensome restrictions or
conditions of an unusual character. [As disclosed in the Incorporated
Documents, the Company is currently providing gas and electric service
to one previously franchised municipality while a new franchise is
being negotiated.]
(xviii) The descriptions in the Registration Statement and the Prospectus,
as amended or supplemented to the date hereof, of statutes, legal and
governmental proceedings and contracts and other documents are
accurate in all material respects and fairly present the information
purported to be given.
(xix) The Registration Statement is effective under the 1933 Act and, to the
best of our knowledge, no proceedings for a stop order have been
instituted or are pending or threatened under Section 8(d) of the 1933
Act; and, at the time the Registration Statement became effective and
at the date of
B-4
the Agreement, the Registration Statement complied, and, at the date
hereof, the Prospectus, as it may have been amended or supplemented,
complies, as to form in all material respects with the requirements of
the 1933 Act and the applicable instructions, rules and regulations
thereunder, or pursuant to said instructions, rules and regulations
are deemed to have complied or to comply therewith, although we do not
express any opinion as to the financial statements (including the
notes thereto) or other financial or statistical data included or
incorporated by reference therein.
We do not know of any legal or governmental proceeding (pending or
threatened) required to be described in the Registration Statement or the
Prospectus, as amended or supplemented to the date hereof, which is not
described as required, nor of any contract or document of a character required
to be described in the Registration Statement or the Prospectus, as amended or
supplemented to the hereof, or to be filed as an exhibit to the Registration
Statement which is not described or filed as required.
In connection with this opinion, we have participated in discussions with
officers and representatives of the Company, in certain of which your
representatives and counsel also participated and at which the affairs of the
Company and the contents of the Registration Statement and the Prospectus were
discussed. There is no assurance that all possible material facts as to the
Company were disclosed to us or that our familiarity with the Company or the
operations in which it is engaged is such that we have necessarily recognized
the materiality of such facts as were disclosed, and we have to a large extent
relied upon statements of officers and representatives of the Company as to the
significance of those facts disclosed to us. We are not passing upon and do not
assume any responsibility for the accuracy, completeness or fairness of the
statements contained in the Registration Statement and the Prospectus except to
the limited extent referred to in paragraphs (xvi) and (xviii) above. Subject to
the foregoing, and to the other limitations and qualifications expressed in this
letter, we may state that nothing has come to our attention that would lead us
to believe that the Registration Statement, when it became effective [or, if an
amendment to the Registration Statement or an Annual Report on Form 10-K has
been filed by the Company with the SEC subsequent to the effectiveness of the
Registration Statement, then at the time such amendment became effective or at
the time of the most recent such filing, as the case may be,] or at the date of
the Agreement, contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading, or that the Prospectus at the date of the
Agreement or at the date hereof, [or, if the opinion is being delivered in
connection with the purchase of Notes from the Company by one or more Agents as
principal pursuant to Section 7(b) of the Agreement, at the date of any
agreement by such Agent or Agents to purchase Notes as principal and at the
Settlement Date with respect thereto, as the case may be,] included or includes
an untrue statement of a material fact or omitted, or omits, to state a material
fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided, that we do
not express any belief as to the financial statements (including the notes
thereto) or other financial or statistical data contained or incorporated by
reference in the Registration Statement or the Prospectus, or any amendment or
supplement thereto, as to any information contained therein furnished to the
Company in writing by any Agent expressly for use therein or as to the Statement
of Eligibility.
This opinion is limited to the laws of the State of New York and the State
of Colorado and the federal law of the United States of America. In addition, we
are not opining herein with respect to the securities or "blue sky" laws of any
state. Finally, this opinion speaks as of the date hereof and we undertake no
responsibility to advise you of any change in circumstances after the date
hereof.
First Trust of New York, National Association is hereby authorized to rely
upon this letter as if this letter were addressed to it. Brown & Wood LLP is
hereby authorized to rely upon this letter as to matters governed by the law of
the State of Colorado as if this letter were addressed to them. This letter is
not being delivered for the benefit of, nor may it be relied upon by, the
holders of the Notes or any other party to which it is not specifically
addressed or to which reliance has not expressly been permitted hereby.
Very truly yours,
B-5
Appendix III
to
Distribution
Agreement
[LETTERHEAD OF BROWN & WOOD LLP]
Re: Public Service Company of Colorado
[Agents]
Ladies and Gentlemen:
We have acted as your counsel in connection with the transactions
contemplated by the Distribution Agreement, dated ______________ (the
"Agreement"), between you and Public Service Company of Colorado, a Colorado
corporation (the "Company"), in connection with the issuance and sale by the
Company of up to $250,000,000 aggregate principal amount of its Secured
Medium-Term Notes, Series B (being a series of First Collateral Trust Bonds)
(the "Notes"), being issued under its Indenture, dated as of October 1, 1993, to
First Trust of New York, National Association, as successor trustee to Morgan
Guaranty Trust Company of New York (formerly Guaranty Trust Company of New
York), and all indentures supplemental thereto, including the Supplemental
Indenture dated as of November 1, 1996 creating the Notes (the "Supplemental
Indenture") (said Indenture dated as of October 1, 1993 and all indentures
supplemental thereto being hereinafter collectively referred to as the
"Indenture").
We have examined such documents and records as we deemed appropriate,
including the following:
(1) copy, certified by the Secretary of State of the State of Colorado to
be a true and complete copy, of the Restated Articles of
Incorporation, as amended, and the Certificate of Correction of the
Company as on file in the office of the Secretary of State of the
State of Colorado;
(2) certificate of recent date of the Secretary of State of the State of
Colorado to the effect that the Company is in good standing;
(3) copy, certified by an Assistant Secretary of the Company to be a true
and correct copy, of the By-Laws of the Company;
(4) minute book records of the Company as furnished to us by the Company;
(5) executed counterpart of the Agreement;
(6) executed counterpart of the Indenture;
(7) copies of papers delivered by the Company to the Trustee under the
Indenture in connection with the authentication and delivery from time
to time of the Notes;
(8) a specimen Note in definitive fully registered form, certified by an
Assistant Secretary of the Company to be a true and correct specimen;
(9) executed counterparts of the Company's Indenture, dated as of December
1, 1939 (the "Original PSCO 1939 Mortgage"), to First Trust of New
York, National Association, as successor trustee to Morgan Guaranty
Trust Company of New York (formerly Guaranty Trust Company of New
York), and all indentures supplemental thereto, including the
supplemental indenture dated as of November 1, 1996 (the "PSCO 1939
Mortgage Supplemental Indenture") creating the Company's first
mortgage bonds to be made the basis of the authentication and delivery
of the Notes (the
C-1
"Class A Bonds") (the Original PSCO 1939 Mortgage and all indentures
supplemental thereto being hereinafter called the "PSCO 1939
Mortgage");
(10) copies of papers delivered by the Company to the trustee under the
PSCO 1939 Mortgage in connection with the authentication and delivery
of the Class A Bonds;
(11) a specimen Class A Bond in definitive fully registered form, certified
by an Assistant Secretary of the Company to be a true and correct
specimen;
(12) copies, certified by an Assistant Secretary of the Company to be true
and correct copies, of certain resolutions adopted by the Board of
Directors of the Company [and by the Executive Committee of the Board
of Directors of the Company] relating to the authorization, execution
and delivery of the Supplemental Indenture, the authorization,
execution and delivery of the PSCO 1939 Mortgage Supplemental
Indenture, with respect to the authorization, issuance and sale of the
Notes, including the Agreement, and with respect to the authorization,
issuance and delivery of the Class A Bonds;
(13) executed copies of the Company's registration statement on Form S-3
(Registration File No. 333-_____) filed by the Company with the
Securities and Exchange Commission (the "Commission") pursuant to the
Securities Act of 1933, as amended (the "1933 Act"), relating to the
registration thereunder of first collateral trust bonds having an
aggregate principal amount not exceeding $400,000,000, including the
Notes. The terms "Registration Statement" and "Prospectus" are used
herein with the meanings ascribed thereto in the Agreement;
(14) evidence of the effectiveness of the Registration Statement under the
1933 Act; and
(15) a copy, certified by the Secretary of The Public Utilities Commission
of the State of Colorado (the "Colorado Commission") to be a true and
complete copy, of the Decision and Order of the Colorado Commission
adopted October 16, 1996, which authorizes the issuance and sale of up
to $650,000,000 aggregate principal amount of the Company's first
collateral trust bonds, including the Notes, and the same principal
amount of Class A Bonds.
In rendering our opinion, we have assumed, without any independent
investigation or verification, the authenticity of all documents submitted
to us as originals and the conformity to original documents of all
documents submitted to us as certified, conformed or photostatic copies,
and the authenticity of all such latter documents.
Based upon the foregoing, and subject to the assumptions set forth
herein, we are of the opinion that:
(a) The Company has been duly incorporated and is validly existing as
a corporation in good standing under the laws of the State of
Colorado with corporate power and authority to own, lease and
operate its properties and to conduct its business as described
in the Prospectus, as amended or supplemented to the date hereof.
(b) The Indenture has been duly and validly authorized, executed and
delivered by the Company and (assuming the Indenture has been
duly authorized, executed and delivered by the Trustee)
constitutes a legal, valid and binding mortgage of the Company,
enforceable in accordance with its terms, except as enforcement
thereof may be limited by laws and principles of equity affecting
generally the enforcement of mortgagees' and other creditors'
rights, including without limitation bankruptcy and insolvency
laws and state laws which affect the enforcement of certain
remedial provisions of the Indenture.
(c) The Indenture is qualified under the Trust Indenture Act of 1939,
as amended.
C-2
(d) The Notes are in due and proper form and the issuance and sale of
the Notes by the Company have been duly authorized by all
necessary corporate action, and when a Note has been duly
executed and authenticated as specified in the Indenture and the
Company Order and Officer's Certificate (each as defined in the
Indenture) applicable to such Note and delivered against payment
of the consideration therefor determined in accordance with the
Agreement, such Note will be a legal, valid and binding
obligation of the Company enforceable (subject to the exceptions
and limitations referred to in paragraph (b) hereof) in
accordance with its terms and entitled to the benefits and
security of the Indenture; and such Note will be secured equally
and ratably with all other Notes and bonds outstanding under the
Indenture.
(e) The PSCO 1939 Mortgage has been duly and validly authorized,
executed and delivered by the Company and (assuming the PSCO 1939
Mortgage has been duly authorized, executed and delivered by the
trustee thereunder) constitutes a legal, valid and binding
mortgage of the Company, enforceable in accordance with its
terms, except as enforcement thereof may be limited by laws and
principles of equity affecting generally the enforcement of
mortgagees' and other creditors' rights, including without
limitation bankruptcy and insolvency laws and state laws which
affect the enforcement of certain remedial provisions of the PSCO
1939 Mortgage.
(f) The Class A Bonds are in due and proper form and the issuance and
delivery of the Class A Bonds by the Company have been duly
authorized by all necessary corporate action; and when (a) a
Class A Bond has been duly executed, authenticated and delivered
to the Trustee as specified in the PSCO 1939 Mortgage and the
order of an officer of the Company applicable to such Class A
Bond and (b) the related Note has been duly executed and
authenticated as specified in the Indenture and the Company Order
and Officer's Certificate applicable to such Note and delivered
against payment of the consideration therefor determined in
accordance with the Agreement, such Class A Bond will be a legal,
valid and binding obligation of the Company enforceable (subject
to the exceptions and limitations referred to in paragraph (e)
hereof) in accordance with its terms and entitled to the benefits
and security of the PSCO 1939 Mortgage; and such Class A Bond
will be secured equally and ratably with all other bonds
outstanding under the PSCO 1939 Mortgage (except to the extent
that any sinking, amortization, improvement or other fund may
afford additional security for such bonds of any particular
series).
(g) The Agreement has been duly authorized, executed and delivered by
the Company.
(h) The issuance and sale of the Notes, and the issuance and delivery
of the Class A Bonds, have been duly authorized and approved by
the Colorado Commission; no further approval, authorization,
consent or other order of any public board or body (other than in
connection or compliance with the provisions of the securities
laws of any jurisdiction) is legally required for the issuance
and sale by the Company of the Notes pursuant to the Agreement or
for the issuance and delivery of the Class A Bonds; and the
Company is presently exempt from all of the provisions of the
Public Utility Holding Company Act of 1935, as amended, except
Section 9(a)(2) thereof.
(i) The Notes, the Indenture, the Class A Bonds and the PSCO 1939
Mortgage conform as to legal matters to the description of the
terms thereof contained in the Registration Statement and the
Prospectus, as amended or supplemented to the date hereof.
(j) The Registration Statement is effective under the 1933 Act and,
to the best of our knowledge, no proceedings for a stop order
have been instituted or are pending or threatened under Section
8(d) of the 1933 Act; and, at the time the Registration Statement
became effective and at the date of the Agreement, the
Registration Statement complied,
C-3
and, at the date hereof, the Prospectus, as it may have been
amended or supplemented, complies, as to form in all material
respects with the requirements of the 1933 Act and the applicable
instructions, rules and regulations thereunder, or pursuant to
said instructions, rules and regulations are deemed to have
complied or to comply therewith, although we do not express any
opinion as to the financial statements (including the notes
thereto) or other financial or statistical data included or
incorporated by reference therein.
We have endeavored to see that the Registration Statement and the
Prospectus, and any amendment or supplement thereto, comply with the 1933 Act
and the rules and regulations of the Commission thereunder relating to
registration statements on Form S-3 and related prospectuses, but we have
participated to a limited extent only in the preparation of the documents
incorporated by reference in the Registration Statement and Prospectus and we
cannot, of course, make any representation to you as to the accuracy or
completeness of statements of fact contained in the Registration Statement or
Prospectus, including the documents incorporated therein by reference. Nothing,
however, has come to our attention that would lead us to believe that the
Registration Statement, at the time it became effective [or, if an amendment to
the Registration Statement or an Annual Report on Form 10-K has been filed by
the Company with the Commission subsequent to the effectiveness of the
Registration Statement, then at the time such amendment became effective or at
the time of the most recent such filing, as the case may be] or at the date of
the Agreement, contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading or that the Prospectus at the date of the
Agreement or at the date hereof [or, if the opinion is being delivered in
connection with the purchase of Notes from the Company by one or more Agents as
principal pursuant to Section 7(b) of the Agreement, at the date of any
agreement by such Agent or Agents to purchase Notes as principal and at the
Settlement Date with respect thereto, as the case may be], included or includes
an untrue statement of a material fact or omitted or omits to state a material
fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided that we do
not express any belief as to the financial statements or other financial or
statistical data contained or incorporated by reference in the Registration
Statement or the Prospectus, or any amendment or supplement thereto, or as to
the Statement of Eligibility.
In giving this opinion we have relied as to all matters governed by
Colorado law upon the opinion of even date herewith rendered to you by LeBoeuf,
Lamb, Greene & MacRae, L.L.P. relating to the Notes. We express no opinion upon
matters regarding titles to properties of the Company, the lien of the Indenture
or the filing or the recordation thereof, the lien of the PSCO 1939 Mortgage or
the filing or the recordation thereof, or of the validity and sufficiency of the
franchises, licenses and permits of the Company in carrying on its business.
Very truly yours,
C-4
Appendix IV
to
Distribution
Agreement
CONTENTS OF LETTER OF ARTHUR ANDERSEN LLP
The letter of Arthur Andersen LLP will confirm that they are independent
public accountants within the meaning of the 1933 Act and the 1933 Act
Regulations, and will state in effect that:
(a) in their opinion, the consolidated financial statements and supporting
financial schedules audited by them and incorporated by reference in
the Registration Statement comply as to form in all material respects
with the applicable accounting requirements of the 1933 Act and the
1934 Act and the applicable respective published rules and regulations
thereunder;
(b) on the basis of a limited review (but not an audit in accordance with
generally accepted auditing standards) of the unaudited consolidated
condensed financial statements, if any, included in the documents
incorporated by reference in the Prospectus and of the latest
available interim consolidated financial statements of the Company, a
reading of all recent minutes of meetings of the Board of Directors of
the Company and the Executive and Audit Committees thereof (or for
meetings for which minutes had not yet been prepared, discussions with
a Company officer of the actions taken thereat), of the shareholders
of the Company and of the shareholders and Boards of Directors of the
Company's consolidated subsidiaries, and discussions with officers of
the Company responsible for financial and accounting matters and such
other inquiries and procedures as may be specified in such letter,
nothing came to their attention which caused them to believe that:
(i) the unaudited consolidated condensed financial statements, if
any, included in the documents incorporated by reference in the
Prospectus do not comply as to form in all material respects with
the applicable accounting requirements of the 1934 Act and the
related published 1934 Act Regulations, or said consolidated
condensed financial statements are not in conformity with
generally accepted accounting principles applied on a basis
substantially consistent with that of the audited consolidated
financial statements incorporated by reference therein,
(ii) the unaudited income statement and balance sheet amounts, if any,
included in the Prospectus were not determined on a basis
substantially consistent with the audited financial statements
included therein, or
(iii) (A) there was any change in the consolidated capital stock,
other than ongoing sales under the Company's Automatic
Dividend Reinvestment and Common Stock Purchase Plan, or any
increase in the long-term debt of the Company and its
consolidated subsidiaries, or any decrease in consolidated
net assets, at a specified date not more than three days
prior to the date of such letter as compared with the
corresponding amounts shown in the most recent consolidated
balance sheet or condensed balance sheet incorporated by
reference in the Prospectus, or
(B) there was any decrease in consolidated operating revenues or
net income for the period from the date of the latest
consolidated balance sheet or condensed balance sheet
incorporated by reference in the Prospectus to a specified
date not
D-1
later than three days prior to the date of such letter as
compared to such amounts for the corresponding period during
the previous year,
except in all instances for changes, increases or decreases which
the Prospectus discloses have occurred or may occur or which are
disclosed in such letter;
(c) they have carried out certain procedures and made certain findings,
specified in such letter, with respect to certain amounts and
percentages included in the Prospectus and the documents
incorporated by reference in the Prospectus and such other items as
the Agents may reasonably request.
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APPENDIX V
____________________, 19__
[Agents]
Re: Public Service Company of Colorado Secured Medium-Term Notes
Dear Sirs:
We have delivered an opinion to you dated ______________ as counsel to
Public Service Company of Colorado (the "Company"), pursuant to Section 5(b) of
the Distribution Agreement, dated as of ____________, among the Company and you,
as Agents. You may continue to rely upon such opinion as if it were dated as of
this date except that all statements and opinions contained therein shall be
deemed to relate to the Registration Statement and Prospectus as amended and
supplemented to this date.
This letter is delivered to you pursuant to Section 6(b) of the
Distribution Agreement.
Very truly yours,
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