EXHIBIT (1)-(2)
WISCONSIN ELECTRIC POWER COMPANY
DEBT SECURITIES
UNDERWRITING AGREEMENT
New York, New York
Dated the date set
forth in Schedule I hereto
To the Underwriters
set forth in
Schedule II hereto
Dear Sirs and Madams:
Wisconsin Electric Power Company, a Wisconsin corporation (the
"Company"), proposes to issue and sell to the underwriter or underwriters
named in Schedule II hereto (the "Underwriters"), the aggregate principal
amount of one or more new series of its debt securities (the "Securities") set
forth in Schedule I hereto, to be issued pursuant to an indenture dated as of
________, 1995 (the "Indenture"), between the Company and Firstar Trust
Company, as trustee (the "Trustee"). The terms of the Securities are also set
forth in Schedule I hereto. The terms "you" and "yours" refer to those
Underwriters who sign the Underwriting Agreement either on behalf of
themselves only or on behalf of themselves and as representative or
representatives of the Underwriters (the "Representatives") named in Schedule
II hereto, as the case may be.
Representations and Warranties. The Company represents and
warrants to, and agrees with, each Underwriter that:
The Company meets the requirements for use of Form S-3 under the
Securities Act of 1933, as amended (the "Act"). The Company has filed
with the Securities and Exchange Commission (the "Commission") a
registration statement on such Form (having the number set forth in
Schedule I hereto), which has become effective, for the registration
under the Act of the Securities. Such registration statement, as
amended at the date of this Agreement, meets the requirements set forth
in Rule 415(a)(1)(x) under the Act and complies in all other material
respects with said Rule. The Company proposes to file with the
Commission pursuant to Rule 424(b)(2) or 424(b)(5) under the Act a
supplement (the "Prospectus Supplement") to the form of prospectus
included in such registration statement relating to the Securities and
the plan of distribution thereof and has previously advised you of all
further information (financial and other) with respect to the Company to
be set forth therein. Such registration statement, including the
exhibits thereto, as amended at the date of this Agreement, is
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hereinafter called the "Registration Statement"; such prospectus in the
form in which it appears in the Registration Statement is hereinafter
called the "Basic Prospectus"; and the Basic Prospectus, as supplemented
by the Prospectus Supplement, in the form in which it shall be filed
with the Commission pursuant to Rule 424(b)(2) or 424(b)(5) is
hereinafter called the "Final Prospectus". Any preliminary form of the
Final Prospectus which has heretofore been filed pursuant to Rule
424(b)(2) or 424(b)(5) is hereinafter called the "Preliminary Final
Prospectus". Any reference herein to the Registration Statement, the
Basic Prospectus, any Preliminary Final Prospectus or the Final
Prospectus shall be deemed to refer to and include the documents
incorporated by reference therein pursuant to Item 12 of Form S-3 which
were filed under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), on or before the date of this Agreement, or the issue
date of the Basic Prospectus, any Preliminary Final Prospectus or the
Final Prospectus, as the case may be; and any reference herein to the
terms "amend," "amendment" or "supplement" with respect to the
Registration Statement, the Basic Prospectus, any Preliminary Final
Prospectus or the Final Prospectus shall be deemed to refer to and
include the filing of any document under the Exchange Act after the date
of this Agreement, or the issue date of the Basic Prospectus, any
Preliminary Final Prospectus or the Final Prospectus, as the case may
be, deemed to be incorporated therein by reference.
(b) As of the date hereof, when the Final Prospectus is
first filed or transmitted for filing pursuant to Rule 424(b)(2) or
424(b)(5) under the Act, when, prior to the Closing Date (as hereinafter
defined), any amendment to the Registration Statement becomes effective
(including the filing of any document incorporated by reference in the
Registration Statement), when any supplement to the Final Prospectus is
filed with the Commission and at the Closing Date, (i) the Registration
Statement, as then amended as of any such time, and the Final
Prospectus, as then amended or supplemented as of such time, and the
Indenture will comply in all material respects with the applicable
requirements of the Act, the Trust Indenture Act of 1939, as amended
(the "Trust Indenture Act"), and the Exchange Act and the respective
rules thereunder and (ii) neither the Registration Statement, as then
amended as of such time, nor the Final Prospectus, as then amended or
supplemented, as of such time, will contain any untrue statement of a
material fact or omit to state any material fact required to be stated
therein or necessary in order to make the statements therein not
misleading; provided, however, that the Company makes no representations
or warranties as to (i) that part of the Registration Statement which
shall constitute the Statement of Eligibility (Form T-1) under the Trust
Indenture Act of the Trustee or (ii) the information contained in or
omitted from the Registration Statement or the Final Prospectus or any
amendment thereof or supplement thereto in reliance upon and in
conformity with information furnished in writing to the Company by or on
behalf of the Underwriter specifically for use in connection with the
preparation of the Registration Statement and the Final Prospectus.
Purchase and Sale. Subject to the terms and conditions and in
reliance upon the representations and warranties herein set forth, the Company
agrees to sell to each Underwriter, and each Underwriter agrees, severally and
not jointly, to purchase from the Company, the principal amount of the
Securities set forth opposite such Underwriter's name in Schedule II hereto,
in each case at the purchase price set forth in Schedule I hereto.
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Delivery and Payment. Delivery of and payment for the
Securities shall be made at the office, on the date and at the time specified
in Schedule I hereto, which date and time may be postponed by agreement
between you and the Company (such date and time of delivery and payment for
the Securities being herein called the "Closing Date"). Delivery of the
Securities shall be made to you for the respective accounts of the several
Underwriters against payment of the purchase price thereof to or upon the
order of the Company by wire transfer or certified or official bank check or
checks payable in immediately available funds or next-day funds, all as set
forth in Schedule I hereto. Certificates for the Securities shall be
registered in such names and in such denominations as you may request not less
than two full business days in advance of the Closing Date.
The Company agrees to have the Securities available for
inspection, checking and packaging by you in New York, New York, not later
than 1:00 P.M. on the business day immediately preceding the Closing Date.
Offering by Underwriters. It is understood that the several
Underwriters proposes to offer the Securities for sale to the public as set
forth in the Final Prospectus.
Agreements. The Company agrees with the several Underwriters
that:
Prior to the termination of the offering of the Securities, the
Company will not file any amendment to the Registration Statement or
supplement (including the Final Prospectus or the Basic Prospectus)
unless the Company has furnished to you copies for your review prior to
filing and will not file any such proposed amendment or supplement to
which you reasonably object (except any filings required to be made
pursuant to the Exchange Act or the rules and regulations thereunder).
Subject to the foregoing sentence, the Company will cause the Final
Prospectus to be filed with the Commission pursuant to Rule 424(b)(2) or
424(b)(5) or will cause the Final Prospectus to be transmitted by a
means reasonably calculated to result in filing with the Commission
pursuant to said Rule. The Company will promptly advise you (i) when
the Final Prospectus shall have been transmitted to the Commission for
filing or filed pursuant to Rule 424(b)(2) or 424(b)(5), (ii) when any
amendment to the Registration Statement shall have been filed or become
effective, (iii) of any request by the Commission for any amendment of
the Registration Statement or amendment or supplement to the Final
Prospectus or for any additional information, (iv) of the issuance by
the Commission of any stop order suspending the effectiveness of the
Registration Statement or any amendment thereto or the initiation or the
threatened initiation of any proceeding for that purpose and (v) of the
receipt by the Company of any notification with respect to the
suspension of the qualification of the Securities for sale in any
jurisdiction or the initiation or the threatened initiation of any
proceeding for such purpose. The Company will use its best efforts to
prevent the issuance of any such stop order and, if issued, to obtain as
soon as possible the withdrawal thereof.
(b) If, at any time when a prospectus relating to the
Securities is required to be delivered under the Act, any event occurs
as a result of which the Final Prospectus as then amended or
supplemented would include any untrue statement of a material fact or
omit to state any material fact necessary to make the statements therein
in light of the circumstances under which they were made not misleading,
or if it shall be necessary to amend the Registration Statement or
supplement the Final Prospectus to comply with the Act or the Exchange
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Act or the respective rules thereunder, the Company promptly will
prepare and file with the Commission, subject to the first sentence of
paragraph (a) of this Section 5, an amendment or supplement which will
correct such statement or omission or an amendment which will effect
such compliance.
(c) As soon as practicable, the Company will make generally
available to its security holders and to you an earnings statement or
statements of the Company which will satisfy the provisions of Section
11(a) of the Act and Rule 158 under the Act.
(d) The Company will furnish to the Underwriters and counsel
for the Underwriters without charge, copies of the Registration
Statement (including exhibits thereto) and each amendment thereto which
shall become effective on or prior to the Closing Date, the Basic
Prospectus and, so long as delivery of a prospectus by the Underwriters
or a dealer may be required by the Act, as many copies of any
Preliminary Final Prospectus, the Final Prospectus, any amendments and
supplements thereto and documents incorporated by reference therein as
you may reasonably request. The Company will pay the expenses of
printing all documents relating to the offering of the Securities.
(e) The Company will arrange for the qualification of the
Securities for sale under the laws of such jurisdictions as you may
designate, will maintain such qualifications in effect so long as
required for the distribution of the Securities and will arrange for the
determination of the legality of the Securities for purchase by
institutional investors; provided, however, that the Company shall not
be required to qualify as a foreign corporation or to file any consent
to service of process under the laws of any jurisdiction or to comply
with any other requirements deemed by the Company to be unduly
burdensome.
(f) Until the business day following the Closing Date, the
Company will not without your consent offer, sell or contract to sell,
or announce the offering of, any debt securities covered by the
Registration Statement or any other registration statement filed under
the Act.
Conditions to the Obligations of the Underwriters. The
obligations of the Underwriters to purchase the Securities shall be subject to
the accuracy of the representations and warranties on the part of the Company
contained herein as of the date hereof, as of the date of the effectiveness of
any amendment to the Registration Statement filed prior to the Closing Date
(including the filing of any document incorporated by reference therein) and
as of the Closing Date, to the accuracy of the statements of the Company or
the Company officers made in any certificates pursuant to the provisions
hereof, to the performance by the Company of its obligations hereunder and to
the following additional conditions:
No stop order suspending the effectiveness of the Registration
Statement, as amended from time to time, shall have been issued and no
proceedings for that purpose shall have been instituted or threatened;
and the Final Prospectus shall have been filed or the Company will cause
the Final Prospectus to be transmitted by a means reasonably calculated
to result in filing with the Commission not later than 5:00 P.M., New
York City time, on the business day following the date hereof.
(b) The Company shall have furnished to the Underwriters the
opinion of Walter T. Woelfle, Esq., Director - Legal Services Department
of the Company, James D. Zakrajsheck, Counsel of the Company, or
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A. William Finke, Esq., Counsel of the Company, dated the Closing Date,
to the effect that:
the Company has been duly incorporated and is validly
existing as a corporation in active status under the laws of the
State of Wisconsin, with full corporate power and authority to
own its properties and conduct its business as described in the
Final Prospectus and is duly qualified to do business as a
foreign corporation and is in good standing under the laws of
each jurisdiction which requires such qualification wherein it
owns or leases material properties or conducts material
business;
(ii) the Securities conform as to legal
matters in all material respects to the description thereof
contained in the Final Prospectus;
(iii) the Indenture has been duly authorized,
executed and delivered by the Company and the Trustee, has been
duly qualified under the Trust Indenture Act, and constitutes a
legal, valid and binding instrument enforceable against the
Company in accordance with its terms (subject, as to
enforcement, to the qualifications set forth in the next
sentence); and the Securities have been duly authorized by all
necessary corporate action of the Company, executed and
authenticated in accordance with the provisions of the Indenture
(assuming that the Securities have been duly authenticated by
the Trustee, which fact such counsel need not verify by an
inspection of the Securities) and constitute legal, valid and
binding obligations of the Company entitled to the benefits of
the Indenture and enforceable in accordance with their terms
(subject, as to enforcement, to the qualifications set forth in
the next sentence). The opinions that the Indenture and the
Securities are enforceable in accordance with their terms are
subject to applicable bankruptcy, reorganization, insolvency,
moratorium or other laws affecting creditors' rights generally
from time to time in effect and general equity principles;
(iv) the Company conducts its business under
valid franchises, permits and licenses which contain no
burdensome restrictions and which are adequate for the business
of the Company in the territories which it serves, except
that the Company as no franchise in several small areas where,
for the most part, the Company is serving certain customers at
the request of other companies who have franchises in those
areas;
(v) there is no pending legal proceeding
or, to the best knowledge of such counsel (after due inquiry),
threatened action, suit or other legal proceeding before any
court or governmental agency, authority, or body or any
arbitrator involving the Company, of a character required to be
disclosed in the Registration Statement which is not adequately
disclosed in the Final Prospectus; there is no franchise,
contract or other document of a character required to be
described in the Registration Statement or Final Prospectus, or
to be filed as an exhibit, which is not described or filed as
required; and the statements included or incorporated by
reference in the Final Prospectus describing any legal
proceedings or material contracts or agreements relating to the
Company fairly summarize such matters;
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(vi) the Registration Statement and any
amendments thereto have become effective under the Act; no stop
order suspending the effectiveness of the Registration
Statement, as amended, has been issued, no proceedings for that
purpose have been instituted or, to the best knowledge of such
counsel, threatened, and the Registration Statement, the Final
Prospectus and each amendment thereof or supplement thereto as
of their respective effective or issue dates (other than the
financial statements and other financial and statistical
information contained or incorporated by reference therein as to
which such counsel need express no opinion) on their face
complied as to form in all material respects with the applicable
requirements of the Act and the Exchange Act and the respective
rules thereunder; and such counsel has no reason to believe that
the Registration Statement, or any amendment thereof, at the
time it became effective and at the date of this Agreement,
contained any untrue statement of a material fact or omitted to
state any material fact required to be stated therein or
necessary to make the statements therein not misleading or that
the Final Prospectus, as amended or supplemented, includes any
untrue statement of a material fact or omits to state a material
fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading;
(vii) this Agreement has been duly authorized,
executed and delivered by the Company;
(viii) all requisite approvals of the Public
Service Commission of Wisconsin ("PSCW") and the Michigan Public
Service Commission ("MPSC") for the execution and delivery of
the Indenture and the issuance and sale by the Company of the
Securities to the Underwriters under this Agreement have been
obtained; the Securities have been issued and sold to the
Underwriter by the Company in conformity with the orders of such
Commission issued with respect thereto; and such counsel knows
of no other approvals of regulatory authorities required in
connection with such matters, other than approvals which may be
required under state securities laws;
(ix) neither the issue and sale of the
Securities, nor the consummation of any other of the
transactions herein contemplated nor the fulfillment of the
terms hereof will conflict with, result in a breach of, or
constitute a default under the Restated Articles of
Incorporation or Bylaws of the Company, as amended, or the terms
of any indenture or other agreement or instrument to which the
Company is a party or bound, or any law, rule, order, decision,
judgment or regulation, applicable to the Company of any court,
regulatory body, administrative agency, governmental body or
arbitrator having jurisdiction over the Company;
(x) no holders of securities of the Company
have rights to the registration of such securities under the
Registration Statement; and
(xi) each of the Company and Wisconsin Energy
Corporation ("Wisconsin Energy") is exempt from the provisions
of the Public Utility Holding Company Act of 1935, as amended
(the "Public Utility Holding Company Act"), except Section
9(a)(2) thereof relating to the acquisition of securities of
other public utility companies.
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In rendering such opinion such counsel may rely (A) as to
matters of Michigan law relating to the authority to do business and
regulatory approval for the Securities in Michigan upon the opinion of
Messrs. Loomis, Ewert, Parsley, Davis & Gotting, P.C., Michigan counsel
to the Company, furnished to the Underwriters; and (B) as to matters of
fact, to the extent he deems proper, on certificates of responsible
officers of the Company, the Trustee and public officials.
The Company shall have furnished to the Underwriters the opinion
of Quarles & Brady, counsel for the Company, dated the Closing Date, to
the effect that:
the Indenture has been duly authorized, executed and
delivered by the Company, has been duly qualified under the
Trust Indenture Act, and constitutes a valid instrument legally
binding upon the Company; the Securities have been duly
authorized by all necessary corporate action of the Company,
have been duly issued (assuming that the Securities have been
duly authenticated by the Trustee, which fact such counsel need
not verify by an inspection of the Securities), constitute
legal, valid and binding obligations of the Company entitled to
the benefits of the Indenture and enforceable in accordance with
their terms subject, as to enforcement, to applicable
bankruptcy, reorganization, insolvency, moratorium or other
laws affecting creditors' rights generally from time to time in
effect and general equity principles;
(ii) the Company's Registration Statement on
Form S-3 relating to the Securities has become effective under
the Act and, to the best of the knowledge of such counsel, no
stop order proceedings with respect thereto are pending or
threatened under Section 8(d) of the Act;
(iii) this Agreement has been duly authorized,
executed and delivered by the Company;
(iv) all requisite approvals of the PSCW and
the MPSC for the execution and delivery of the Indenture and the
issuance and sale by the Company of the Securities to the
Underwriters under this Agreement have been obtained; the
Securities have been issued and sold to the Underwriters by the
Company in conformity with the orders of such Commission issued
with respect thereto; and such counsel know of no other
approvals of regulatory authorities required in connection with
such matters, other than approvals which may be required under
state securities laws;
(v) the Securities conform as to legal
matters in all material respects to the description thereof in
the Final Prospectus insofar as relating to provisions of the
Indenture and the Debt Securities referred to therein; and
(vi) the Registration Statement, when it
became effective, and the Final Prospectus, as of the date of
the Prospectus Supplement, appeared on their face to comply as
to form, in all material respects, with the requirements of the
Act, the Trust Indenture Act and the applicable rules and
regulations of the Commission thereunder and further that
nothing came to the attention of such counsel in the course of
their representation of the Company which has caused such
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counsel to believe that the Registration Statement, when it
became effective, contained any untrue statement of a material
fact or omitted to state any material fact required to be stated
therein or necessary in order to make the statements therein not
misleading or that the Final Prospectus, on the date of the
Prospectus Supplement and on the Closing Date, contained any
untrue statement of a material fact or omitted to state any
material fact necessary in order to make the statements therein,
in light of the circumstances under which they were made, not
misleading. Such opinion may state that such counsel have not
independently verified, do not pass upon and do not assume any
responsibility for the accuracy, completeness or fairness of the
statements contained in the Registration Statement and Final
Prospectus except for those made under the captions "Description
of Securities" in the Basic Prospectus and "Certain Terms of the
Debentures" and "Underwriting" in the Prospectus Supplement
insofar as they relate to the provisions of documents therein
described and that they do not express any opinion or belief as
to the financial statements or other financial data or
statistical information contained or incorporated by reference
in the Registration Statement, the Basic Prospectus or the
Prospectus Supplement, as to the incorporation of the Company or
franchise matters or as to the Statement of Eligibility on Form
T-1 of the Trustee.
In rendering such opinion or opinions, such counsel may rely (A)
as to [all] matters of Michigan law and the exempt status of the Company
and Wisconsin Energy under the Public Utility Holding Company Act, upon
the opinion of Walter T. Woelfle, Esq., James D. Zakrajsheck, Esq., or
A. William Finke, Esq.; (B) as to [all] matters of Michigan law relating
to regulatory approval for the Securities in Michigan upon the opinion
of Loomis, Ewert, Parsley, Davis & Gotting, P.C., Michigan counsel to
the Company, furnished to you; and (C) as to matters of fact, to the
extent they deem proper on certificates of responsible officers of the
Company, the Trustee and public officials, and may state that they are
not passing upon the incorporation of the Company or its franchises.
The Underwriters shall have received from Cahill Gordon &
Reindel, counsel for the Underwriters, such opinion or opinions, dated
the Closing Date, with respect to the issuance and sale of the
Securities, the Indenture, and other related matters as you may
reasonably require, and the Company shall have furnished to such counsel
such documents as they request for the purpose of enabling them to pass
upon such matters.
In rendering such opinion such counsel may rely (A) as to all
matters of Wisconsin and Michigan law and the exempt status of the
Company and Wisconsin Energy under the Public Utilities Holding Company
Act, upon the opinion of Walter T. Woelfle, Esq., James D. Zakrajsheck,
Esq., or A. William Finke, Esq.; (B) as to [all] matters of Michigan law
relating to regulatory approval for the Securities in Michigan upon the
opinion of Loomis, Ewert, Parsley, Davis & Gotting, P.C., Michigan
counsel to the Company, furnished to you; and (C) as to matters of fact,
to the extent they deem proper, on certificates of responsible officers
of the Company, the Trustee and public officials.
The Company shall have furnished to you a certificate of the
Company, signed by the Chairman of the Board or the President and the
principal financial or accounting officer of the Company, dated the
Closing Date, to the effect that the signers of such certificate have
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carefully examined the Registration Statement, the Final Prospectus and
this Agreement and that:
the representations and warranties of the Company in
this Agreement are true and correct in all material respects on and as
of the Closing Date with the same effect as if made on the Closing Date
and the Company has complied with all the agreements and satisfied all
the conditions on its part to be performed or satisfied at or prior to
the Closing Date;
(ii) no stop order suspending the
effectiveness of the Registration Statement, as amended, has
been issued and no proceedings for that purpose have been
instituted or, to the Company's knowledge, threatened; and
(iii) since the date of the most recent
financial statements included or incorporated by reference in
the Final Prospectus, there has been no material adverse change
in the condition (financial or other), earnings, business or
properties of the Company, whether or not arising from
transactions in the ordinary course of business, except as set
forth in or contemplated in the Final Prospectus.
At the time this Agreement is executed and at the Closing Date,
Price Waterhouse shall have furnished to the Underwriters a letter or
letters, dated as of the date of this Agreement and the Closing Date
(which may refer to the letter previously delivered to the
Underwriters), in form and substance satisfactory to the Underwriters,
confirming that they are independent accountants within the meaning of
the Act and the applicable published rules and regulations thereunder,
and stating in effect that:
in their opinion the audited financial statements
included or incorporated by reference in the Registration Statement and
the Final Prospectus and reported on by them comply as to form in all
material respects with the applicable accounting requirements of the Act
and the Exchange Act and the related published rules and regulations
with respect to registration statements on Form S-3;
(ii) on the basis of procedures (but not an
examination in accordance with generally accepted auditing
standards) which would not necessarily reveal matters of
significance with respect to the comments set forth in such
letter, consisting of:
a) reading the minutes of meetings of the
stockholders and directors of the Company since a
specified date as of the end of the last period for
which they have audited the financial statements of the
Company, as set forth in the minute books, through a
specified date not more than five business days prior
to the date of such letter;
b) reading the unaudited interim financial
data of the Company included or incorporated by
reference in the Registration Statement and the Final
Prospectus and the unaudited interim financial data
as of the latest date made available by the Company; and
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c) making inquiries of certain officials
of the Company who have responsibility for financial and
accounting matters regarding the specific items for
which representations are requested below;
nothing has come to their attention as a result of the foregoing
procedures that caused them to believe that:
(1) any unaudited financial data included or
incorporated by reference in the Registration Statement and the
Final Prospectus do not comply as to form in all material
respects with applicable accounting requirements of the Exchange
Act as it applies to Form 10-Q and the published rules and
regulations thereunder; and said unaudited financial data are
not stated on a basis substantially consistent with that of the
audited financial statements included or incorporated in the
Registration Statement and the Final Prospectus; or
(2) with respect to the period subsequent to the
date of the most recent financial data incorporated in the
Registration Statement and the Final Prospectus, there were any
changes, at a specified date not more than five business days
prior to the date of the letter, in the long-term debt of the
Company or capital stock of the Company or decreases in the
stockholder's equity of the Company or any decrease in retained
earnings of the Company as compared with the amounts shown on
the most recent balance sheet incorporated by reference in the
Registration Statement and the Final Prospectus, or for the
period from the date of the most recent financial data
incorporated by reference in the Registration Statement and the
Final Prospectus to the date of the latest available unaudited
consolidated financial data of the Company there were any
decreases, as compared with the corresponding period in the
preceding year, in Operating Revenues, Operating Income or Net
Income of the Company, except in all instances for changes or
decreases set forth in such letter, in which case the letter
shall be accompanied by an explanation by the Company as to the
significance thereof unless said explanation is not deemed
necessary by you; and
they have performed certain other specified procedures
as a result of which they determined that certain information of
an accounting, financial or statistical nature (which is limited
to accounting, financial or statistical information derived from
the general accounting records of the Company subject to its
system of internal accounting controls) set forth in the
Registration Statement, as amended, and the Final Prospectus, as
amended or supplemented, and in Exhibit 12 to the Registration
Statement, including the information included under the captions
"Capitalization" in the Final Prospectus or "Certain Summary
Financial Information" or "Recent Developments" in the Basic
Prospectus and the Final Prospectus, or included or incorporated
by reference in Items 1, 3, 5, 6, 7 and 11 of the Company's
annual report on Form 10-K incorporated therein or in
"Management's Discussion and Analysis of Financial Condition and
Results of Operations" included or incorporated in any of the
Company's quarterly reports on Form 10-Q incorporated by
reference therein, agrees with the accounting records of the
Company, excluding any question of legal interpretation.
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Subsequent to the respective dates as of which information is
given in the Registration Statement and the Final Prospectus, there
shall not have been (i) any change or decrease specified in the letter
or letters referred to in paragraph (f) of this Section 6 or (ii) any
change, or any development involving a prospective change, in or
affecting particularly the business or properties of the Company the
effect of which, in any case referred to in clause (i) or (ii) above,
is, in your judgment, so material and adverse as to make it impractical
or inadvisable to proceed with the offering or the delivery of the
Securities as contemplated by the Registration Statement and the Final
Prospectus.
Subsequent to the execution of this Agreement, there shall not
have been any decrease in the ratings of any of the Company's debt
securities by Moody's Investors Service, Inc., or Standard & Poor's
Corporation.
(i) Prior to the Closing Date, the Company shall have
furnished to you such further information, certificates and documents as
you may reasonably request.
(j) The issuance and sale of the Securities as contemplated
in this Agreement and the Final Prospectus shall have been duly
authorized and approved by orders of the PSCW and the MPSC; such orders
shall be in full force and effect at the Closing Date and shall not
contain any modifications from their form at the date hereof not
reasonably acceptable to you; and no action, authorization or approval
of any other regulatory authority or court shall then be required in
connection with the issuance and sale by the Company of the Securities.
If any of the conditions specified in this Section 6 shall not
have been fulfilled in all material respects when and as provided in this
Agreement, or if any of the opinions and certificates mentioned above or
elsewhere in this Agreement shall not be in all material respects reasonably
satisfactory in form and substance to you, this Agreement and all the
obligations of the Underwriter hereunder may be cancelled by you at, or at any
time prior to, the Closing Date. Notice of such cancellation shall be given
to the Company in writing or by telephone or telegraph confirmed in writing.
Reimbursement of Underwriters' Expenses. If the sale of the
Securities provided for herein is not consummated because any condition to the
obligations of the Underwriters set forth in Section 6 hereof or any condition
to the obligations of the Company in Section 10 hereof is not satisfied,
because of any termination pursuant to Section 11 or because of any refusal,
inability or failure on the part of the Company to perform any agreement
herein or comply with any provision hereof, other than by reason of a default
by the Underwriters, the Company will reimburse the Underwriters upon demand
for all out-of-pocket expenses (including reasonable fees and disbursements of
counsel) that shall have been incurred by the Underwriters in connection with
the proposed purchase and sale of the Securities.
Indemnification and Contribution. (a) The Company agrees to
indemnify and hold harmless each Underwriter and each person, if any, who
controls any Underwriter within the meaning of either the Act or the Exchange
Act against any and all losses, claims, damages or liabilities, joint or
several, to which they or any of them may become subject under the Act, the
Exchange Act or other Federal or state statutory law or regulation, at common
law or otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement for the registration of the Securities as originally
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filed or in any amendment thereof, or in the Basic Prospectus or the Final
Prospectus, any Preliminary Final Prospectus or in any amendment thereof or
supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, and agrees to
reimburse each such indemnified party for any legal or other expenses
reasonably incurred by them in connection with investigating or defending any
such loss, claim, damage, liability or action; provided, however, that (i) the
Company will not be liable in any such case to the extent that any such loss,
claim, damage or liability arises out of or is based upon any such untrue
statement or alleged untrue statement or omission or alleged omission made
therein in reliance upon and in conformity with written information furnished
to the Company by or on behalf of the Underwriter specifically for use in
connection with the preparation thereof and (ii) such indemnity with respect
to the Basic Prospectus or any Preliminary Final Prospectus shall not inure to
the benefit of any Underwriter (or any person controlling such Underwriter)
from whom the person asserting any such loss, claim, damage or liability
purchased the Securities which are the subject thereof if such person did not
receive a copy of the Final Prospectus (or the Final Prospectus, as amended or
supplemented) excluding documents incorporated therein by reference at or
prior to the confirmation of the sale of the Securities to such person in any
case where such delivery is required by the Act and the untrue statement or
omission of a material fact contained in the Basic Prospectus or any
Preliminary Final Prospectus was corrected in the Final Prospectus (or the
Final Prospectus, as amended or supplemented). This indemnity agreement will
be in addition to any liability which the Company may otherwise have.
(b) Each Underwriter agrees to indemnify and hold harmless
the Company, each of its directors, each of its officers who signs the
Registration Statement and each person who controls the Company within the
meaning of either the Act or the Exchange Act, to the same extent as the
foregoing indemnity from the Company to each Underwriter, but only with
reference to written information relating to such Underwriter, furnished to
the Company by or on behalf of the Underwriter, specifically for use in the
preparation of the documents referred to in the foregoing indemnity. This
indemnity agreement will be in addition to any liability which any Underwriter
may otherwise have.
(c) Promptly after receipt by an indemnified party under
this Section 8 of notice of the commencement of any action, such indemnified
party will, if a claim in respect thereof is to be made against the
indemnifying party under this Section 8, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party will not relieve it from any liability which it may have to
any indemnified party otherwise than under this Section 8. In case any such
action is brought against any indemnified party, and it notifies the
indemnifying party of the commencement thereof, the indemnifying party will be
entitled to participate therein, and to the extent that it may elect by
written notice delivered to the indemnified party promptly after receiving the
aforesaid notice from such indemnified party, to assume the defense thereof,
with counsel satisfactory to such indemnified party; provided, however, that
if the defendants in any such action include both the indemnified party and
the indemnifying party and the indemnified party shall have reasonably
concluded that there may be legal defenses available to it or other
indemnified parties which are different from or additional to those available
to the indemnifying party, the indemnified party or parties shall have the
right to select separate counsel to assert such legal defenses and to
otherwise participate in the defense of such action on behalf of such
indemnified party or parties. Upon receipt of notice from the indemnifying
party to such indemnified party of its election so to assume the defense of
such action and approval by the indemnified party of counsel, the indemnifying
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party will not be liable to such indemnified party under this Section 8 for
any legal or other expenses subsequently incurred by such indemnified party in
connection with the defense thereof unless (i) the indemnified party shall
have employed separate counsel in connection with the assertion of legal
defenses in accordance with the proviso to the next preceding sentence (it
being understood, however, that the indemnifying party shall not be liable for
the expenses of more than one separate counsel, approved by you in the case of
paragraph (a) of this Section 8, representing the indemnified parties under
such paragraph (a) who are parties to such action), (ii) the indemnifying
party shall not have employed counsel satisfactory to the indemnified party to
represent the indemnified party within a reasonable time after notice of
commencement of the action or (iii) the indemnifying party has authorized the
employment of counsel for the indemnified party at the expense of the
indemnifying party; and except that, if clause (i) or (iii) is applicable,
such liability shall be only in respect of the counsel referred to in such
clause (i) or (iii).
(d) In order to provide for just and equitable contribution
in circumstances in which the indemnification provided for in paragraph (a) of
this Section 8 is due in accordance with its terms but is for any reason held
by a court to be unavailable from the Company on grounds of policy or
otherwise, the Company and the Underwriters shall contribute to the aggregate
losses, claims, damages and liabilities (including legal or other expenses
reasonably incurred in connection with investigating or defending same) to
which the Company and one or more of the Underwriters may be subject in such
proportion so that the Underwriters are responsible for that portion
represented by the percentage that the underwriting discount bears to the sum
of such discount and the purchase price of the Securities and the Company is
responsible for the balance; provided, however, that (y) in no case shall any
Underwriter (except as may be provided in any agreement among underwriters
relating to the offering of the Securities) be responsible for any amount in
excess of the underwriting discount applicable to the Securities purchased
hereunder and (z) no person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. For
purposes of this Section 8, each person who controls an Underwriter within the
meaning of either the Act or the Exchange Act shall have the same rights to
contribution as such Underwriter, and each person who controls the Company
within the meaning of either the Act or the Exchange Act, each officer of the
Company who shall have signed the Registration Statement and each director of
the Company shall have the same rights to contribution as the Company, subject
in each case to clauses (y) and (z) of this paragraph (d). Any party entitled
to contribution will, promptly after receipt of notice of commencement of any
action, suit or proceeding against such party in respect of which a claim for
contribution may be made against another party or parties under this paragraph
(d), notify such party or parties from whom contribution may be sought, but
the omission to so notify such party or parties shall not relieve the party or
parties from whom contribution may be sought from any other obligation it or
they may have hereunder or otherwise than under this paragraph (d). This
contribution agreement will be in addition to any liability which the Company
or any Underwriter may otherwise have.
Default by an Underwriter. If any one or more Underwriters
shall fail to purchase and pay for any of the Securities agreed to be
purchased by such Underwriter or Underwriters hereunder and such failure to
purchase shall constitute a default in the performance of its or their
obligations under this Agreement, the remaining Underwriters shall be
obligated severally to take up and pay for (in the respective proportions
which the amount of Securities set forth opposite their names in Schedule II
hereto bears to the aggregate amount of Securities set forth opposite the
names of all the remaining Underwriters) the Securities which the defaulting
-14-
Underwriter or Underwriters agreed but failed to purchase; provided, however,
that in the event that the aggregate amount of Securities which the defaulting
Underwriter or Underwriters agreed but failed to purchase shall exceed 10% of
the aggregate amount of Securities set forth in Schedule II hereto, the
remaining Underwriters shall have the right to purchase all, but shall not be
under any obligation to purchase any, of the Securities, and if such
nondefaulting Underwriters do not purchase all the Securities, this Agreement
will terminate without liability to any nondefaulting Underwriter or the
Company. In the event of a default by any Underwriter as set forth in this
Section 9, the Closing Date shall be postponed for such period, not exceeding
seven days, as you shall determine in order that the required changes in the
Registration Statement and the Final Prospectus or in any other documents or
arrangements may be effected. Nothing contained in this Agreement shall
relieve any defaulting Underwriter of its liability, if any, to the Company
and any nondefaulting Underwriter for damages occasioned by its default
hereunder.
Conditions to the Obligations of the Company. The obligation of
the Company to sell the Securities shall be subject to the condition that the
issuance and sale of the Securities as contemplated in this Agreement and the
Final Prospectus shall have been duly authorized and approved by the order of
the PSCW and MPSC; such order shall be in full force and effect at the Closing
Date and shall not contain any modification from its form at the date hereof
not reasonably acceptable to the Company; and no authorization or approval of
any other regulatory authority shall then be required in connection with the
issuance and sale by the Company of the Securities.
Termination. This Agreement shall be subject to termination in
your absolute discretion by notice given to the Company prior to delivery of
and payment for the Securities, if prior to such time (i) trading in the
common stock of Wisconsin Energy Corporation shall have been suspended by the
Commission or the New York Stock Exchange or trading in securities generally
on the New York Stock Exchange shall have been suspended or limited or minimum
prices shall have been established on such Exchange; (ii) a banking moratorium
shall have been declared either by federal or New York State authorities; or
(iii) there shall have occurred any outbreak or material escalation of
hostilities or declaration by the United States of a national emergency or war
or other calamity or crisis the effect of which on the financial markets of
the United States is such as to make it, in your judgment, impracticable to
market the Securities.
Representations and Indemnities to Survive. The respective
agreements, representations, warranties, indemnities and other statements of
the Company or its officers and of the Underwriter set forth in or made
pursuant to this Agreement will remain in full force and effect, regardless of
any investigation made by or on behalf of any Underwriter or the Company or
any of the officers, directors or controlling persons referred to in Section 8
hereof, and will survive delivery of and payment for the Securities. The
provisions of Sections 7 and 8 hereof shall survive the termination or
cancellation of this Agreement.
Notices. All communications hereunder will be in writing and
effective only on receipt, and, if sent to the Underwriters will be mailed,
delivered or telegraphed and confirmed to you, at the address set forth in
Schedule I hereto; or, if sent to the Company, will be mailed, delivered or
telegraphed and confirmed to it at 231 West Michigan Street, P.O. Box 2046,
Milwaukee, Wisconsin 53201, attention of the Chief Financial Officer.
-15-
Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the
officers and directors and controlling persons referred to in Section 8
hereof, and no other person will have any right or obligation hereunder.
Applicable Law. This Agreement will be governed by and
construed in accordance with the laws of the State of New York.
If the foregoing is in accordance with your understanding of
our agreement, please sign and return to us the enclosed duplicate hereof,
whereupon this letter and your acceptance shall represent a binding agreement
between the Company and the Underwriters.
Very truly yours,
WISCONSIN ELECTRIC POWER COMPANY
By: _______________________________
Chief Financial Officer
The foregoing Agreement is
hereby confirmed and accepted
as of the date specified in
Schedule I hereto.
[NAME(S) OF REPRESENTATIVE(S)]
By: _____________________________
Authorized Signatory
For itself and the other Under-
writers, if any, named in
Schedule II to the foregoing
Agreement.
SCHEDULE I
Underwriting Agreement dated _________, 199_
Registration Statement No. 33-_______
Name and Address of Underwriter(s):
Title and Certain Terms of Securities:
Title: ______% ________ due _______,_____
Principal amount: $_________
Maturity: ________, ____ (__ years)
Interest Rate: ______%
Interest Payment Dates: _________ and _________
Sinking Fund:
Redemption provisions:
Purchase Price (include accrued interest or amortization, if any):
______% of principal amount, plus accrued interest from _______, 199_ to the
date of delivery
Payment for the Securities shall be made in the following form
and funds:
Closing Date, Time and Location:
________, 199_ ____ _.M. (_________ time)
Offices of:
Securities delivered to:
SCHEDULE II
Underwriter Amount
- ----------- ------
$
_________
Total $_________