LETTER OF TRANSMITTAL
OF
NIAGARA MOHAWK POWER CORPORATION
PURSUANT TO THE OFFER TO PURCHASE
DATED FEBRUARY 27, 2002
THIS LETTER OF TRANSMITTAL IS BEING USED WITH RESPECT TO
FIXED/ADJUSTABLE RATE
CUMULATIVE PREFERRED STOCK, SERIES D
(CUSIP NO. 653522771)
AT A PURCHASE PRICE OF $53.76 PER SHARE
THE OFFER AND YOUR WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY
TIME, ON WEDNESDAY, MARCH 27, 2002, UNLESS EXTENDED OR EARLIER TERMINATED (SUCH
TIME AND DATE, AS THE SAME MAY BE EXTENDED OR TERMINATED, AN "EXPIRATION DATE").
The Depositary for the Offer is:
THE BANK OF NEW YORK
<Table>
By Mail: By Hand: By Overnight Delivery:
The Bank of New York The Bank of New York The Bank of New York
Niagara Mohawk PFD Tender Reorganization Services Niagara Mohawk PFD Tender
PO Box 859208 One Wall Street -- 3rd Floor 165 Bay State Road
Braintree, MA 02185-9208 New York, NY 10286 Braintree, MA 02184
</Table>
By Facsimile:
(781) 380-3388
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET FORTH
ABOVE OR TRANSMISSION OF THIS LETTER OF TRANSMITTAL
VIA A FACSIMILE NUMBER OTHER THAN AS LISTED ABOVE WILL NOT CONSTITUTE A VALID
DELIVERY TO THE DEPOSITARY.
You must sign this Letter of Transmittal in the appropriate space therefor
provided below.
YOU SHOULD READ THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL
CAREFULLY BEFORE YOU COMPLETE THIS LETTER OF TRANSMITTAL.
This Letter of Transmittal is to be used if certificates are to be forwarded
herewith or, unless an Agent's Message (as defined in the Offer to Purchase) is
utilized, if delivery of Series D Preferred Stock (as defined below) is to be
made by book-entry transfer to the Depositary's account at The Depository Trust
Company ("DTC") pursuant to the procedures set forth in Section 3 of the Offer
to Purchase.
IF YOU HAVE ANY QUESTIONS ABOUT HOW TO FILL OUT THIS LETTER OF TRANSMITTAL
PLEASE CONTACT D.F. KING & CO., THE INFORMATION AGENT, AT (888) 414-5566 (TOLL
FREE).
<Table>
- ------------------------------------------------------------------------------------------------------------------
DESCRIPTION OF SERIES D PREFERRED STOCK TENDERED
- ------------------------------------------------------------------------------------------------------------------
NAME(S) AND ADDRESS(ES) OF REGISTERED HOLDER(S)
(PLEASE FILL IN, IF BLANK, EXACTLY AS NAME(S) APPEAR(S) ON SERIES D PREFERRED STOCK TENDERED
CERTIFICATE(S) (ATTACH ADDITIONAL LIST IF NECESSARY)
- ------------------------------------------------------------------------------------------------------------------
TOTAL NUMBER
OF SHARES OF NUMBER OF
SERIES D SHARES OF
PREFERRED STOCK SERIES D
REPRESENTED PREFERRED
CERTIFICATE BY STOCK
NUMBER(S)* CERTIFICATE(S)* TENDERED**
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
TOTAL NUMBER
OF SHARES OF
SERIES D
PREFERRED STOCK
- ------------------------------------------------------------------------------------------------------------------
* Need not be completed by shareholders tendering by book-entry transfer.
** Unless otherwise indicated, it will be assumed that all shares of Series D Preferred Stock represented by any
certificate delivered to the Depositary are being tendered. See Instruction 5 of this Letter of Transmittal.
- ------------------------------------------------------------------------------------------------------------------
</Table>
Please check the applicable box below.
<Table>
[ ] I have lost my certificate(s) that represented --------
shares of Fixed/Adjustable Rate Cumulative Preferred Stock,
Series D and require assistance in obtaining replacement
certificate(s). I understand that checking this box does not
mean that my shares have been validly tendered and that I
must contact the Depositary to obtain instructions for
replacing lost certificates. (See Instruction 9 of this
Letter of Transmittal.)
[ ] CHECK HERE IF CERTIFICATES FOR TENDERED SERIES D PREFERRED
STOCK ARE ENCLOSED HEREWITH.
[ ] CHECK HERE IF TENDERED SERIES D PREFERRED STOCK IS BEING
DELIVERED BY BOOK-ENTRY TRANSFER TO THE DEPOSITARY'S ACCOUNT
AT THE DTC AND COMPLETE THE FOLLOWING:
</Table>
Name of Tendering Institution
- --------------------------------------------------------------------------------
Account Number
- --------------------------------------------------------------------------------
Transaction Code Number
- --------------------------------------------------------------------------------
2
NOTE: SIGNATURES MUST BE PROVIDED BELOW.
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY.
Ladies and Gentlemen:
The undersigned hereby tenders to Niagara Mohawk Power Corporation (the
"Company"), a New York corporation, the shares in the amount set forth in the
box "Description of Series D Preferred Stock Tendered" pursuant to the Company's
offer to purchase any and all of its Fixed/Adjustable Rate Cumulative Preferred
Stock, Series D (the "Series D Preferred Stock"), at $53.76 per share, upon the
terms and subject to the conditions set forth in its Offer to Purchase dated
February 27, 2002 (the "Offer to Purchase") and in this Letter of Transmittal
(which together constitute the "Offer").
Upon the terms and subject to the conditions of the Offer and effective
upon acceptance for payment of and payment for the Series D Preferred Stock
tendered herewith, the undersigned hereby sells, assigns and transfers to, or
upon the order of, the Company all right, title and interest in and to all the
shares of Series D Preferred Stock that are being tendered herewith, or orders
the registration of such shares of Series D Preferred Stock tendered by
book-entry transfer that are purchased pursuant to the Offer to or upon the
order of the Company, and appoints the Depositary the true and lawful agent and
attorney-in-fact of the undersigned with respect to such shares of Series D
Preferred Stock, with full power of substitution (such power of attorney being
deemed to be an irrevocable power coupled with an interest), to:
- deliver certificates representing such shares of Series D Preferred Stock
or transfer ownership of such shares of Series D Preferred Stock on the
account books maintained by the DTC, together, in any such case, with all
accompanying evidences of transfer and authenticity, to or upon the order
of the Company;
- present such shares of Series D Preferred Stock for transfer on the books
of the Company; and
- receive all benefits and otherwise exercise all rights of beneficial
ownership of such shares of Series D Preferred Stock, all in accordance
with the terms of the Offer.
The undersigned hereby represents and warrants to the Company that:
- the undersigned has full power and authority to tender, sell, assign and
transfer the shares of Series D Preferred Stock tendered hereby and that
when the same are accepted for payment by the Company, the Company will
acquire good marketable and unencumbered title thereto, free and clear of
all liens, restrictions, charges and encumbrances and not subject to any
adverse claims;
- the undersigned understands that tenders of shares pursuant to any one of
the procedures described in Section 3 of the Offer to Purchase and in the
instructions to this Letter of Transmittal will constitute the
undersigned's acceptance of the terms and conditions of the Offer,
including the undersigned's representation and warranty that (a) the
undersigned has a "net long position," within the meaning of Rule 14e-4
promulgated under the Securities Exchange Act of 1934, as amended, in the
shares or equivalent securities at least equal to the shares being
tendered, and (b) the tender of shares complies with Rule 14e-4;
- the undersigned will, upon request, execute and deliver any additional
documents deemed by the Depositary or the Company to be necessary or
desirable to complete the sale, assignment and transfer of the shares of
Series D Preferred Stock tendered hereby; and
- the undersigned has read, understands and agrees to all of the terms of
the Offer.
The undersigned understands that the valid tenders of the Series D
Preferred Stock pursuant to any one of the procedures described in Section 3 of
the Offer to Purchase and in the instructions hereto will constitute an
agreement between the undersigned and the Company upon the terms and subject to
the conditions of the Offer. The undersigned acknowledges that under no
circumstances will the Company pay interest on the purchase price, including,
without limitation, by reason of any delay in making payment.
The undersigned recognizes that, under certain circumstances set forth in
the Offer to Purchase, the Company may terminate or amend the Offer or may
postpone the acceptance for payment of, or the payment for, shares of Series D
Preferred Stock tendered or may not be required to purchase any shares of the
Series D Preferred Stock tendered hereby or may accept for payment fewer than
all of the shares of Series D Preferred Stock tendered hereby.
3
Unless otherwise indicated under "Special Payment Instructions" of this
Letter of Transmittal, please issue the check for the purchase price of any
shares of Series D Preferred Stock purchased, and return any shares of Series D
Preferred Stock not tendered or not purchased, in the name(s) of the undersigned
and, in the case of shares of Series D Preferred Stock tendered by book-entry
transfer, by credit to the account at the DTC. Similarly, unless otherwise
indicated under "Special Delivery Instructions" of this Letter of Transmittal,
please mail the check for the purchase price of any shares of Series D Preferred
Stock purchased and any certificates for shares of Series D Preferred Stock not
tendered or not purchased (and accompanying documents, as appropriate) to the
undersigned at the address shown below the undersigned's signature(s). In the
event that both "Special Payment Instructions" and "Special Delivery
Instructions" are completed, please issue the check for the purchase price of
any shares of Series D Preferred Stock purchased and return any shares of Series
D Preferred Stock not tendered or not purchased in the name(s) of, and mail said
check and any certificates to, the person(s) so indicated. The undersigned
recognizes that the Company has no obligation, pursuant to the "Special Payment
Instructions," to transfer any shares of Series D Preferred Stock from the name
of the registered holder(s) thereof if the Company does not accept for payment
any shares of the Series D Preferred Stock so tendered.
All authority conferred or agreed to be conferred by this Letter of
Transmittal will survive the death or incapacity of the undersigned, and any
obligation of the undersigned will be binding on the heirs, personal
representatives, executors, administrators, successors, assigns, trustees in
bankruptcy and legal representatives of the undersigned. Except as stated in the
Offer to Purchase, this tender is irrevocable.
4
PLEASE SIGN HERE
(TO BE COMPLETED BY ALL TENDERING HOLDERS OF SERIES D PREFERRED STOCK)
This Letter of Transmittal must be signed by the registered holder(s) of
Series D Preferred Stock exactly as their name(s) appear(s) on certificate(s)
for shares of Series D Preferred Stock or, if tendered by a participant in the
DTC system, exactly as such participant's name appears on a security position
listing as the owner of shares of Series D Preferred Stock, or by person(s)
authorized to become registered holders of shares of Series D Preferred Stock by
endorsements on certificates for shares of Series D Preferred Stock or by stock
powers transmitted with this Letter of Transmittal. Endorsements on shares of
Series D Preferred Stock and signatures on stock powers by registered holders of
shares of Series D Preferred Stock not executing this Letter of Transmittal must
be guaranteed by an Eligible Institution. See Instructions 1 and 2 below. If
signature is by a trustee, executor, administrator, guardian, attorney-in-fact,
officers of a corporation or other person acting in a fiduciary or
representative capacity, such person must set forth his or her full title below
under "Capacity" and submit evidence satisfactory to the Company of such
person's authority to so act. See Instruction 1 below.
- --------------------------------------------------------------------------------
Signature(s) of Owner(s)
- --------------------------------------------------------------------------------
Signature(s) of Owner(s)
Dated:
- ------------------------------------ , 2002
Name(s):
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Please Print)
Capacity (full title):
- --------------------------------------------------------------------------------
Address:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Including Zip Code)
Area Code and Telephone No.:
- --------------------------------------------------------------------------------
PLEASE COMPLETE SUBSTITUTE FORM W-9 HEREIN
GUARANTEE OF SIGNATURE(S)
(IF REQUIRED, SEE INSTRUCTIONS 1 AND 2)
Name of Firm:
- --------------------------------------------------------------------------------
Address and Telephone Number:
- --------------------------------------------------------------------------------
Authorized Signature:
- --------------------------------------------------------------------------------
Printed Name:
- --------------------------------------------------------------------------------
Title:
- --------------------------------------------------------------------------------
Dated:
- ------------------------------------ , 2002
5
------------------------------------------------------------
SPECIAL PAYMENT INSTRUCTIONS
(SEE INSTRUCTIONS 1, 2, 6 AND 7)
To be completed ONLY if the check for the purchase price of shares of
Series D Preferred Stock purchased (less the amount of any federal income
and backup withholding tax required to be withheld) or certificates for
shares of Series D Preferred Stock not tendered or not purchased are to be
issued in the name of someone other the undersigned.
Mail: [ ] check [ ] certificate(s) to:
Name:
-----------------------------------------------
(PLEASE PRINT)
Address:
------------------------------------------
------------------------------------------------------------
(INCLUDE ZIP CODE)
------------------------------------------------------------
(TAXPAYER IDENTIFICATION NO.)
[ ] Credit unpurchased shares of Series D Preferred Stock by book-entry to
the book-entry transfer facility account set forth below:
DTC Account Number:
---------------------------------
Number of Account Party:
-------------------------------------------
------------------------------------------------------------
------------------------------------------------------------
SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 1, 2 AND 7)
To be completed ONLY if the check for the purchase price of shares of
Series D Preferred Stock purchased (less the amount of any federal income
and backup withholding tax required to be withheld) or certificates for
shares of Series D Preferred Stock not tendered or not purchased are to be
mailed to someone other than the undersigned or to the undersigned at an
address other than that shown below the undersigned's signature(s).
Mail: [ ] check [ ] certificate(s) to:
Name:
-----------------------------------------------
(PLEASE PRINT)
Address:
------------------------------------------
------------------------------------------------------------
(INCLUDE ZIP CODE)
------------------------------------------------------------
6
NIAGARA MOHAWK
FIXED/ADJUSTABLE RATE
CUMULATIVE PREFERRED STOCK, SERIES D
COMPLETE ONLY IF APPLICABLE:
SOLICITED TENDERS
As described in the Offer to Purchase, dated February 27, 2002, Niagara
Mohawk will pay, in the amounts and on the terms and conditions set forth in the
Offer to Purchase, Retail Soliciting Dealer Fees (see Instruction 12) to
designated soliciting dealers (as described in the Offer to Purchase).
The above signed represents that the soliciting dealer that solicited and
obtained this tender is:
Name of Firm:
- --------------------------------------------------------------------------------
(PLEASE PRINT)
Name of Individual Broker:
- --------------------------------------------------------------------------------
Telephone Number of Broker:
- --------------------------------------------------------------------------------
Address:
- --------------------------------------------------------------------------------
(INCLUDE ZIP CODE)
If shares specified in this Letter of Transmittal are held by the above
signed as custodian, specify below each beneficial owner of such shares whose
tender you have solicited. Any questions as to what constitutes beneficial
ownership should be directed to the Depositary. If the space below is
inadequate, attach a separate signed schedule using the same format.
<Table>
<Caption>
NAME OF NUMBER OF PREFERRED SHARES
BENEFICIAL OWNER (MUST BE LESS THAN 5,000)
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
</Table>
The acceptance of compensation by such soliciting dealer will constitute a
representation by it that (a) it has complied with the applicable requirements
of the Securities Exchange Act of 1934, as amended, and the applicable rules and
regulations thereunder, in connection with such solicitation; (b) it is entitled
to such compensation for such solicitation under the terms and conditions of the
Offer to Purchase; (c) in soliciting a tender, it has used no solicitation
materials other than those furnished by Niagara Mohawk; and (d) if it is a
foreign broker or dealer not eligible for membership in the National Association
of Securities Dealers, Inc. (the "NASD"), it has agreed to conform to the NASD's
Rules of Fair Practice in making solicitations. See also Instruction 12.
SOLICITATION FEE PAYMENT INSTRUCTIONS
ISSUE CHECK TO:
Firm:
- --------------------------------------------------------------------------------
(PLEASE PRINT)
Attention:
- --------------------------------------------------------------------------------
Address:
- --------------------------------------------------------------------------------
Phone Number:
---------------------
Taxpayer Identification or Social Security Number:
------------------------------
7
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER
1. SIGNATURES ON LETTER OF TRANSMITTAL; STOCK POWERS AND ENDORSEMENTS. If
this Letter of Transmittal is signed by the registered holder(s) of the shares
of Series D Preferred Stock tendered hereby, the signature(s) must correspond
with the name(s) as written on the face of the certificates without alteration,
enlargement or any change whatsoever.
If any of the shares of Series D Preferred Stock tendered hereby are held
of record by two or more persons, all such persons must sign this Letter of
Transmittal.
If any of the shares of Series D Preferred Stock tendered hereby are
registered in different names on different certificates, it will be necessary to
complete, sign and submit as many separate Letters of Transmittal as there are
different registrations of certificates.
If this Letter of Transmittal is signed by the registered holder(s) of the
shares of Series D Preferred Stock tendered hereby, no endorsements of
certificates or separate stock powers are required unless payment of the
purchase price is to be made, or shares of Series D Preferred Stock not tendered
or not purchased are to be returned, in the name of any person other than the
registered holder(s). Signatures on any such certificates or stock powers must
be guaranteed by an Eligible Institution (as defined in Instruction 2).
If this Letter of Transmittal is signed by a person other than the
registered holder(s) of the shares of Series D Preferred Stock tendered hereby,
certificates must be endorsed or accompanied by appropriate stock powers, in
either case, signed exactly as the name(s) of the registered holder(s) appear(s)
on the certificates for such shares of Series D Preferred Stock. Signature(s) on
any such certificates or stock powers must be guaranteed by an Eligible
Institution.
If this Letter of Transmittal or any certificate or stock power is signed
by a trustee, executor, administrator, guardian, attorney-in-fact, officer of a
corporation or other person acting in a fiduciary or representative capacity,
such person should so indicate when signing, and proper evidence satisfactory to
the Company of the authority of such person so to act must be submitted.
2. GUARANTEE OF SIGNATURES. Except as otherwise provided below, all
signatures on this Letter of Transmittal must be guaranteed by a financial
institution (including most banks, savings and loan associations and brokerage
houses) that is a member of a recognized Medallion Program approved by The
Securities Transfer Association, Inc., including the Securities Transfer Agents
Medallion Program (STAMP), the Stock Exchange Medallion Program (SEMP) and the
New York Stock Exchange, Inc. Medallion Signature Program (MSP) or any other
"eligible guarantor institution" (as such term is defined in Rule 17Ad-15 under
the Securities Exchange Act of 1934, as amended) (each an "Eligible
Institution"). Signatures on this Letter of Transmittal need not be guaranteed
(i) if this Letter of Transmittal is signed by the registered holder(s) of the
shares of Series D Preferred Stock (which term, for purposes of this document,
shall include any participant in the DTC whose name appears on a security
position listing as the owner of shares of Series D Preferred Stock) tendered
herewith and such holder(s) have not completed the boxes entitled "Special
Payment Instructions" or "Special Delivery Instructions" on this Letter of
Transmittal or (ii) if such shares of Series D Preferred Stock is tendered for
the account of an Eligible Institution. See Instruction 1 above.
3. DELIVERY OF LETTER OF TRANSMITTAL AND SERIES D PREFERRED STOCK. This
Letter of Transmittal is to be used either if certificates are to be forwarded
herewith or, unless an Agent's Message is utilized, if delivery of shares of
Series D Preferred Stock is to be made by book-entry transfer pursuant to the
procedures set forth in Section 3 of the Offer to Purchase. Certificates for all
physically delivered shares of Series D Preferred Stock, or a confirmation of a
book-entry transfer into the Depositary's account at DTC of all shares of Series
D Preferred Stock delivered electronically, as well as a properly completed and
duly executed Letter of Transmittal (or in the case of a book-entry transfer, an
Agent's Message) and any other documents required by this Letter of Transmittal,
must be received by the Depositary at one of its addresses set forth on the
front page of this Letter of Transmittal by the Expiration Date.
The term "Agent's Message" means a message, transmitted by DTC to, and
received by, the depositary and forming a part of a book-entry confirmation
which states that DTC has received an express acknowledgment from the
participant in DTC tendering the preferred shares that are the subject of such
book-entry confirmation agreeing to be bound by the terms of the Letter of
Transmittal and that we may enforce such agreement against such participant.
8
THE METHOD OF DELIVERY OF SHARES OF SERIES D PREFERRED STOCK AND ALL OTHER
REQUIRED DOCUMENTS IS AT THE OPTION AND RISK OF THE TENDERING SHAREHOLDER. IF
DELIVERY IS BY MAIL, WE RECOMMEND YOU USE REGISTERED MAIL WITH RETURN RECEIPT
REQUESTED, PROPERLY INSURED. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO
ENSURE TIMELY DELIVERY.
No alternative, conditional or contingent tenders will be accepted, and no
fractional shares of Series D Preferred Stock will be purchased. By executing
this Letter of Transmittal, the tendering shareholder waives any right to
receive any notice of the acceptance for payment of the shares of Series D
Preferred Stock.
4. INADEQUATE SPACE. If the space provided herein is inadequate, the
certificate numbers and/or the number of shares of Series D Preferred Stock
should be listed on a separate schedule attached hereto.
5. PARTIAL TENDERS (NOT APPLICABLE TO SHAREHOLDERS WHO TENDER BY
BOOK-ENTRY TRANSFER). If fewer than all the shares of Series D Preferred Stock
represented by any certificate delivered to the Depositary are to be tendered,
fill in the number of shares of Series D Preferred Stock which are to be
tendered in the box entitled "Number of Shares of Series D Preferred Stock
Tendered." In such case, a new certificate for the remainder of the shares of
Series D Preferred Stock represented by the old certificate will be sent to the
person(s) signing this Letter of Transmittal, unless otherwise provided in the
appropriate box on this Letter of Transmittal, as promptly as practicable
following the expiration or termination of the Offer. All shares of Series D
Preferred Stock represented by certificates delivered to the Depositary will be
deemed to have been tendered unless otherwise indicated.
6. STOCK TRANSFER TAXES. The Company will pay any stock transfer taxes
with respect to the sale and transfer of any shares of Series D Preferred Stock
to it or its order pursuant to the Offer. If, however, payment of the purchase
price is to be made to, or shares of Series D Preferred Stock not tendered or
not purchased is to be returned in the name of, any person other than the
registered holder(s), or if a transfer tax is imposed for any reason other than
the sale or transfer of shares of Series D Preferred Stock to the Company
pursuant to the Offer, then the amount of any stock transfer taxes (whether
imposed on the registered holder(s), such other person or otherwise) will be
deducted from the purchase price unless satisfactory evidence of the payment of
such taxes, or exemption therefrom, is submitted herewith.
7. SPECIAL PAYMENT AND DELIVERY INSTRUCTIONS. If the check for the
purchase price of any shares of Series D Preferred Stock purchased is to be
issued, or any shares of Series D Preferred Stock not tendered or not purchased
is to be returned, in the name of a person other than the person(s) signing this
Letter of Transmittal or if the check or any certificates for shares of Series D
Preferred Stock not tendered or not purchased are to be mailed to someone other
than the person(s) signing this Letter of Transmittal or to the person(s)
signing this Letter of Transmittal at an address other than that shown above,
the appropriate boxes on this Letter of Transmittal should be completed.
Shareholders tendering shares of Series D Preferred Stock by book-entry transfer
may request that shares of Series D Preferred Stock not purchased be credited to
such account at any of the book-entry transfer facilities as such shareholder
may designate under "Special Payment Instructions" above. If no such
instructions are given, any such shares of Series D Preferred Stock not
purchased will be returned by crediting the account at the book-entry transfer
facilities at DTC.
8. SUBSTITUTE FORM W-9 AND W-8BEN. Under the federal income tax laws, the
Depositary will be required to withhold 30% of the amount of any payments made
to certain shareholders pursuant to the Offer, as described below. In order to
avoid such backup withholding, each tendering shareholder, and, if applicable,
each other payee, must provide the Depositary with such shareholder's or payee's
correct taxpayer identification number and certify that such shareholder or
payee is not subject to such backup withholding by completing the substitute
Form W-9 included below. In general, if a shareholder or payee is an individual,
the taxpayer identification number is the Social Security number of such
individual. If the Depositary is not provided with the correct taxpayer
identification number, the shareholder or payee may be subject to a $50 penalty
imposed by the Internal Revenue Service. Certain shareholders or payees
(including, among others, all corporations and certain foreign individuals) are
not subject to these backup withholding and reporting requirements. To avoid
possible erroneous backup withholding, a shareholder who is exempt from backup
withholding should complete the substitute Form W-9 by providing his or her
correct TIN, signing and dating the form and writing "exempt" on the face of the
form. Noncorporate foreign shareholders must instead submit to the Depositary a
properly completed Form W-8BEN, Certificate of Foreign Status (which the
Depositary will provide upon request), signed under penalties of perjury,
attesting to such person's exempt status. For further information concerning
backup withholding and instructions for completing the substitute Form W-9
(including how to obtain a taxpayer identification number if you do not have one
and how to complete the substitute Form W-9 if shares are held in more than one
name), consult the enclosed Guidelines for Certification of Taxpayer
Identification Number on substitute Form W-9.
9
Failure to complete the substitute Form W-9 or Form W-8BEN will not, by
itself, cause shares of Series D Preferred Stock to be deemed invalidly tendered
but may require the Depositary to withhold 30% of the amount of any payments
made pursuant to the Offer. Backup withholding is not an additional federal
income tax. Rather, the federal income tax liability of a person subject to
backup withholding will be reduced by the amount of tax withheld. If withholding
results in an overpayment of taxes, a refund may be obtained provided that the
required information is furnished to the Internal Revenue Service. NOTE: FAILURE
TO COMPLETE AND RETURN THE SUBSTITUTE FORM W-9 MAY RESULT IN BACKUP WITHHOLDING
OF 30% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER. PLEASE REVIEW THE
ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON
SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
9. MUTILATED, LOST, STOLEN OR DESTROYED CERTIFICATES. If a certificate
that represents shares of Series D Preferred Stock has been mutilated, lost,
stolen or destroyed, the holder should (i) complete this Letter of Transmittal
and check the appropriate box and (ii) contact the Depositary immediately. The
Depositary will provide such holder with all necessary forms and instructions to
replace any mutilated, lost, stolen or destroyed certificates. The holder may
also be required to give the Company a bond as indemnity against any claim that
may be made against it with respect to the certificate(s) alleged to have been
mutilated, lost, stolen or destroyed. This Letter of Transmittal and related
documents cannot be processed until the procedures for replacing mutilated,
lost, stolen or destroyed certificates have been followed.
10. IRREGULARITIES. All questions as to the purchase price, the form of
documents, and the validity, eligibility, including time of receipt, and
acceptance of any tender of shares of Series D Preferred Stock will be
determined by the Company, in its sole discretion, and its determination shall
be final and binding. The Company reserves the absolute right to reject any or
all tenders of shares of Series D Preferred Stock that it determines are not in
proper form or the acceptance for payment of or payment for shares of Series D
Preferred Stock that may, in the opinion of the Company's counsel, be unlawful.
Except as otherwise provided in the Offer to Purchase, the Company also reserves
the absolute right to waive any of the conditions to the Offer or any defect or
irregularity in any tender of shares of Series D Preferred Stock, and its
interpretation of the terms and conditions of the Offer, including these
instructions, shall be final and binding. Unless waived, any defects or
irregularities in connection with tenders must be cured within such time as the
Company shall determine.
11. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Requests for assistance
may be made to the Information Agent or the Dealer Manager at their respective
addresses or telephone numbers set forth on the back cover of this Letter of
Transmittal. Additional copies of the Offer to Purchase and this Letter of
Transmittal may be obtained from the Information Agent.
12. RETAIL SOLICITING DEALER FEE INSTRUCTIONS. Upon the terms and subject
to the conditions set forth in this Letter of Transmittal and the Offer to
Purchase, in the event that the relevant beneficial owner so designates, the
Company will pay, promptly after the Expiration Date, to persons who were
responsible for soliciting tenders from beneficial owners whose individual
ownership is less than 5,000 shares of Series D Preferred Stock, a fee (the
"Retail Soliciting Dealer Fee") equal to $0.75 per share of Series D Preferred
Stock for which instructions to tender have been given due to the efforts of
such soliciting person, provided that the instructions and Letter of Transmittal
relating thereto have been validly delivered. The "Solicited Tenders Box" should
be completed to designate a soliciting dealer. No person may receive the Retail
Soliciting Dealer Fee unless such person is (i) a broker or dealer in
securities, including the dealer manager in its capacity as a dealer or broker,
which is a member of any national securities exchange or of the National
Association of Securities Dealers, Inc. ("NASD"), (ii) a foreign broker or
dealer not eligible for membership in the NASD which agrees to conform to the
NASD's Rules of Fair Practice in soliciting tenders outside the U.S. to the same
extent as though it were an NASD member or (iii) a bank or trust company legally
authorized to receive such fees. Beneficial owners are able to nominate such
retail soliciting dealers in the appropriate section of this Letter of
Transmittal. Participants in DTC will be required to undertake to distribute the
related Retail Soliciting Dealer Fee to such persons as appropriate. Neither the
Company nor the Dealer Manager will be responsible for making such distribution
or for ensuring that DTC participants make such distribution.
10
<Table>
- ---------------------------------------------------------------------------------------------------------------------------
SUBSTITUTE PART 1 -- Taxpayer Identification
FORM W-9 Number -- For all accounts, enter your
DEPARTMENT OF THE TREASURY taxpayer identification number in the
INTERNAL REVENUE SERVICE appropriate box. For most individuals and
sole proprietors, this is your Social --------------------------------------------
Security Number. For other entities, it is Social Security Number
your Employer Identification Number. If you
do not have a number, see "How to Obtain a OR
TIN" in the enclosed Guidelines. Note: If ---------------------------------------
the account is in more than one name, see Employer Identification Number
the chart in the enclosed Guidelines to
determine what number to enter.
------------------------------------------------------------------------------------------
PART II -- Certification -- Under penalties of perjury, I certify that:
(1)(a) The number shown on this form is my correct taxpayer identification number or (b) a
taxpayer identification number has not been issued to me and either (i) I have mailed or
delivered an application to receive a taxpayer identification number to the appropriate
Internal Revenue Service Center or Social Security Administration Office or (ii) I intend
to mail or deliver an application in the near future. I understand that if I do not provide
a taxpayer identification number by the time payment is made to me pursuant to the Offer,
30% of all reportable payments made to me pursuant to the Offer will be withheld;
(2) I am not subject to backup withholding either because (a) I am exempt from backup
withholding, or (b) I have not been notified by the Internal Revenue Service ("IRS") that I
am subject to backup withholding as a result of a failure to report all interest or
PAYER'S REQUEST FOR TAXPAYER dividends, or (c) after being so notified, the IRS had notified me that I am no longer
IDENTIFICATION NUMBER subject to backup withholding;
(3) I am a U.S. person (including a U.S. resident alien); and
(4) Any information provided on this form is true, correct and complete.
- ---------------------------------------------------------------------------------------------------------------------------
CERTIFICATION INSTRUCTIONS -- You must cross out item (2) above if you have been notified by the
IRS that you are subject to backup withholding because of underreporting interest or dividends PART III
on your tax return. However, if after being notified by the IRS that you were subject to backup Awaiting TIN [ ]
withholding you received another notification from the IRS stating that you are no longer
subject to backup withholding, do not cross out item (2). If you are awaiting the issuance of a
taxpayer identification number, check the box in Part III. If you are exempt from backup PART IV
withholding, check the box in Part IV. Exempt from Backup
Withholding [ ]
- ---------------------------------------------------------------------------------------------------------------------------
Signature:
- ---------------------------------------------------------------------------------------------------------------------------
Name: Date:
--------------------------------------------------------------------------------------------------------------------------
Address:
--------------------------------------------------------------------------------------------------------------------------
(Please Print)
</Table>
Check appropriate box: [ ] Individual/Sole proprietor [ ] Corporation
[ ] Partnership [ ] Other
- --------------------------------------------------------------------------------
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP
WITHHOLDING OF 30% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER. PLEASE
REVIEW ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER
ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
- --------------------------------------------------------------------------------
11
Questions regarding how to tender and requests for additional copies of this
document, the Offer to Purchase or other documents related to the Offer should
be directed to the Information Agent.
The Information Agent for the Offer is:
D.F. KING & CO., INC.
77 Water Street
New York, NY 10005
(888) 414-5566 (toll free)
Questions regarding the terms of the offer should be directed to the Dealer
Manager.
The Dealer Manager for the Offer is:
MERRILL LYNCH & CO.
4 World Financial Center, 7th Floor
New York, NY 10080
Attention: Liability Management Group
(888) ML4-TNDR (654-8637)
LETTER OF TRANSMITTAL
OF
NIAGARA MOHAWK POWER CORPORATION
PURSUANT TO THE OFFER TO PURCHASE
DATED FEBRUARY 27, 2002
THIS LETTER OF TRANSMITTAL IS BEING USED WITH RESPECT TO
CUMULATIVE PREFERRED STOCK, 3.40% SERIES
(CUSIP NO. 653522201)
AT A PURCHASE PRICE OF $63.43 PER SHARE
THE OFFER AND YOUR WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY
TIME, ON WEDNESDAY, MARCH 27, 2002, UNLESS EXTENDED OR EARLIER TERMINATED (SUCH
TIME AND DATE, AS THE SAME MAY BE EXTENDED OR TERMINATED, AN "EXPIRATION DATE").
The Depositary for the Offer is:
THE BANK OF NEW YORK
<Table>
By Mail: By Hand: By Overnight Delivery:
The Bank of New York The Bank of New York The Bank of New York
Niagara Mohawk PFD Tender Reorganization Services Niagara Mohawk PFD Tender
PO Box 859208 One Wall Street -- 3rd Floor 165 Bay State Road
Braintree, MA 02185-9208 New York, NY 10286 Braintree, MA 02184
</Table>
By Facsimile:
(781) 380-3388
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET FORTH
ABOVE OR TRANSMISSION OF THIS LETTER OF TRANSMITTAL VIA A FACSIMILE NUMBER OTHER
THAN AS LISTED ABOVE WILL NOT CONSTITUTE A VALID DELIVERY TO THE DEPOSITARY.
You must sign this Letter of Transmittal in the appropriate space therefor
provided below.
YOU SHOULD READ THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL
CAREFULLY BEFORE YOU COMPLETE THIS LETTER OF TRANSMITTAL.
This Letter of Transmittal is to be used if certificates are to be forwarded
herewith or, unless an Agent's Message (as defined in the Offer to Purchase) is
utilized, if delivery of 3.40% Series Preferred Stock (as defined below) is to
be made by book-entry transfer to the Depositary's account at The Depository
Trust Company ("DTC") pursuant to the procedures set forth in Section 3 of the
Offer to Purchase.
IF YOU HAVE ANY QUESTIONS ABOUT HOW TO FILL OUT THIS LETTER OF TRANSMITTAL
PLEASE CONTACT D.F. KING & CO., THE INFORMATION AGENT, AT (888) 414-5566 (TOLL
FREE).
<Table>
- ------------------------------------------------------------------------------------------------------------------
DESCRIPTION OF 3.40% SERIES PREFERRED STOCK TENDERED
- ------------------------------------------------------------------------------------------------------------------
NAME(S) AND ADDRESS(ES) OF REGISTERED HOLDER(S)
(PLEASE FILL IN, IF BLANK, EXACTLY AS NAME(S) APPEAR(S) ON 3.40% SERIES PREFERRED STOCK TENDERED
SHARE CERTIFICATE(S)) (ATTACH ADDITIONAL LIST IF NECESSARY)
- ------------------------------------------------------------------------------------------------------------------
TOTAL NUMBER
OF SHARES OF NUMBER OF
3.40% SERIES SHARES OF
PREFERRED STOCK 3.40% SERIES
REPRESENTED PREFERRED
CERTIFICATE BY STOCK
NUMBER(S)* CERTIFICATE(S)* TENDERED**
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
TOTAL NUMBER
OF SHARES OF
3.40% SERIES
PREFERRED STOCK
- ------------------------------------------------------------------------------------------------------------------
* Need not be completed by shareholders tendering by book-entry transfer.
** Unless otherwise indicated, it will be assumed that all shares of 3.40% Series Preferred Stock represented by
any certificate delivered to the Depositary are being tendered. See Instruction 5 of this Letter of
Transmittal.
- ------------------------------------------------------------------------------------------------------------------
</Table>
Please check the applicable box below.
<Table>
[ ] I have lost my certificate(s) that represented
--------------- shares of Cumulative Preferred Stock, 3.40%
Series and require assistance in obtaining replacement
certificate(s). I understand that checking this box does not
mean that my shares have been validly tendered and that I
must contact the Depositary to obtain instructions for
replacing lost certificates. (See Instruction 9 of this
Letter of Transmittal.)
[ ] CHECK HERE IF CERTIFICATES FOR TENDERED 3.40% SERIES
PREFERRED STOCK ARE ENCLOSED HEREWITH.
[ ] CHECK HERE IF TENDERED 3.40% SERIES PREFERRED STOCK IS BEING
DELIVERED BY BOOK-ENTRY TRANSFER TO THE DEPOSITARY'S ACCOUNT
AT THE DTC AND COMPLETE THE FOLLOWING:
</Table>
Name of Tendering Institution
- --------------------------------------------------------------------------------
Account Number
- --------------------------------------------------------------------------------
Transaction Code Number
- --------------------------------------------------------------------------------
2
NOTE: SIGNATURES MUST BE PROVIDED BELOW.
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY.
Ladies and Gentlemen:
The undersigned hereby tenders to Niagara Mohawk Power Corporation (the
"Company"), a New York corporation, the shares in the amount set forth in the
box "Description of 3.40% Series Preferred Stock Tendered" pursuant to the
Company's offer to purchase any and all of its Cumulative Preferred Stock, 3.40%
Series (the "3.40% Series Preferred Stock"), at $63.43 per share, upon the terms
and subject to the conditions set forth in its Offer to Purchase dated February
27, 2002 (the "Offer to Purchase") and in this Letter of Transmittal (which
together constitute the "Offer").
Upon the terms and subject to the conditions of the Offer and effective
upon acceptance for payment of and payment for the 3.40% Series Preferred Stock
tendered herewith, the undersigned hereby sells, assigns and transfers to, or
upon the order of, the Company all right, title and interest in and to all the
shares of 3.40% Series Preferred Stock that are being tendered herewith, or
orders the registration of such shares of 3.40% Series Preferred Stock tendered
by book-entry transfer that are purchased pursuant to the Offer to or upon the
order of the Company, and appoints the Depositary the true and lawful agent and
attorney-in-fact of the undersigned with respect to such shares of 3.40% Series
Preferred Stock, with full power of substitution (such power of attorney being
deemed to be an irrevocable power coupled with an interest), to:
- deliver certificates representing such shares of 3.40% Series Preferred
Stock or transfer ownership of such shares of 3.40% Series Preferred
Stock on the account books maintained by the DTC, together, in any such
case, with all accompanying evidences of transfer and authenticity, to or
upon the order of the Company;
- present such shares of 3.40% Series Preferred Stock for transfer on the
books of the Company; and
- receive all benefits and otherwise exercise all rights of beneficial
ownership of such shares of 3.40% Series Preferred Stock, all in
accordance with the terms of the Offer.
The undersigned hereby represents and warrants to the Company that:
- the undersigned has full power and authority to tender, sell, assign and
transfer the shares of 3.40% Series Preferred Stock tendered hereby and
that when the same are accepted for payment by the Company, the Company
will acquire good marketable and unencumbered title thereto, free and
clear of all liens, restrictions, charges and encumbrances and not
subject to any adverse claims;
- the undersigned understands that tenders of shares pursuant to any one of
the procedures described in Section 3 of the Offer to Purchase and in the
instructions to this Letter of Transmittal will constitute the
undersigned's acceptance of the terms and conditions of the Offer,
including the undersigned's representation and warranty that (a) the
undersigned has a "net long position," within the meaning of Rule 14e-4
promulgated under the Securities Exchange Act of 1934, as amended, in the
shares or equivalent securities at least equal to the shares being
tendered, and (b) the tender of shares complies with Rule 14e-4;
- the undersigned will, upon request, execute and deliver any additional
documents deemed by the Depositary or the Company to be necessary or
desirable to complete the sale, assignment and transfer of the shares of
3.40% Series Preferred Stock tendered hereby; and
- the undersigned has read, understands and agrees to all of the terms of
the Offer.
The undersigned understands that the valid tenders of the 3.40% Series
Preferred Stock pursuant to any one of the procedures described in Section 3 of
the Offer to Purchase and in the instructions hereto will constitute an
agreement between the undersigned and the Company upon the terms and subject to
the conditions of the Offer. The undersigned acknowledges that under no
circumstances will the Company pay interest on the purchase price, including,
without limitation, by reason of any delay in making payment.
The undersigned recognizes that, under certain circumstances set forth in
the Offer to Purchase, the Company may terminate or amend the Offer or may
postpone the acceptance for payment of, or the payment for, shares of 3.40%
Series
3
Preferred Stock tendered or may not be required to purchase any shares of the
3.40% Series Preferred Stock tendered hereby or may accept for payment fewer
than all of the shares of 3.40% Series Preferred Stock tendered hereby.
Unless otherwise indicated under "Special Payment Instructions" of this
Letter of Transmittal, please issue the check for the purchase price of any
shares of 3.40% Series Preferred Stock purchased, and return any shares of 3.40%
Series Preferred Stock not tendered or not purchased, in the name(s) of the
undersigned and, in the case of shares of 3.40% Series Preferred Stock tendered
by book-entry transfer, by credit to the account at the DTC. Similarly, unless
otherwise indicated under "Special Delivery Instructions" of this Letter of
Transmittal, please mail the check for the purchase price of any shares of 3.40%
Series Preferred Stock purchased and any certificates for shares of 3.40% Series
Preferred Stock not tendered or not purchased (and accompanying documents, as
appropriate) to the undersigned at the address shown below the undersigned's
signature(s). In the event that both "Special Payment Instructions" and "Special
Delivery Instructions" are completed, please issue the check for the purchase
price of any shares of 3.40% Series Preferred Stock purchased and return any
shares of 3.40% Series Preferred Stock not tendered or not purchased in the
name(s) of, and mail said check and any certificates to, the person(s) so
indicated. The undersigned recognizes that the Company has no obligation,
pursuant to the "Special Payment Instructions," to transfer any shares of 3.40%
Series Preferred Stock from the name of the registered holder(s) thereof if the
Company does not accept for payment any shares of the 3.40% Series Preferred
Stock so tendered.
All authority conferred or agreed to be conferred by this Letter of
Transmittal will survive the death or incapacity of the undersigned, and any
obligation of the undersigned will be binding on the heirs, personal
representatives, executors, administrators, successors, assigns, trustees in
bankruptcy and legal representatives of the undersigned. Except as stated in the
Offer to Purchase, this tender is irrevocable.
4
PLEASE SIGN HERE
(TO BE COMPLETED BY ALL TENDERING HOLDERS OF 3.40% SERIES PREFERRED STOCK)
This Letter of Transmittal must be signed by the registered holder(s) of
3.40% Series Preferred Stock exactly as their name(s) appear(s) on
certificate(s) for shares of 3.40% Series Preferred Stock or, if tendered by a
participant in the DTC system, exactly as such participant's name appears on a
security position listing as the owner of shares of 3.40% Series Preferred
Stock, or by person(s) authorized to become registered holders of shares of
3.40% Series Preferred Stock by endorsements on certificates for shares of 3.40%
Series Preferred Stock or by stock powers transmitted with this Letter of
Transmittal. Endorsements on shares of 3.40% Series Preferred Stock and
signatures on stock powers by registered holders of shares of 3.40% Series
Preferred Stock not executing this Letter of Transmittal must be guaranteed by
an Eligible Institution. See Instructions 1 and 2 below. If signature is by a
trustee, executor, administrator, guardian, attorney-in-fact, officers of a
corporation or other person acting in a fiduciary or representative capacity,
such person must set forth his or her full title below under "Capacity" and
submit evidence satisfactory to the Company of such person's authority to so
act. See Instruction 1 below.
- --------------------------------------------------------------------------------
Signature(s) of Owner(s)
- --------------------------------------------------------------------------------
Signature(s) of Owner(s)
Dated:
- ------------------------------------ , 2002
Name(s):
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Please Print)
Capacity (full title):
- --------------------------------------------------------------------------------
Address:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Include Zip Code)
Area Code and Telephone Number:
- --------------------------------------------------------------------------------
PLEASE COMPLETE SUBSTITUTE FORM W-9 HEREIN
GUARANTEE OF SIGNATURE(S)
(IF REQUIRED, SEE INSTRUCTIONS 1 AND 2)
Name of Firm:
- --------------------------------------------------------------------------------
Address and Telephone Number:
- --------------------------------------------------------------------------------
Authorized Signature:
- --------------------------------------------------------------------------------
Printed Name:
- --------------------------------------------------------------------------------
Title:
- --------------------------------------------------------------------------------
Dated:
- ------------------------------------ , 2002
5
------------------------------------------------------------
SPECIAL PAYMENT INSTRUCTIONS
(SEE INSTRUCTIONS 1, 2, 6 AND 7)
To be completed ONLY if the check for the purchase price of shares of
3.40% Series Preferred Stock purchased (less the amount of any federal
income and backup withholding tax required to be withheld) or certificates
for shares of 3.40% Series Preferred Stock not tendered or not purchased
are to be issued in the name of someone other the undersigned.
Mail: [ ] check [ ] certificates to:
Name:
----------------------------------------------------
(PLEASE PRINT)
Address:
--------------------------------------------------
------------------------------------------------------------
(INCLUDING ZIP CODE)
------------------------------------------------------------
(TAXPAYER IDENTIFICATION NO.)
Credit unpurchased shares of 3.40% Series Preferred Stock by book-entry to
the book-entry transfer facility account set forth below:
DTC Account Number:
-----------------------------------------------
Number of Account Party:
-----------------------------------------------
------------------------------------------------------------
------------------------------------------------------------
SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 1, 2 AND 7)
To be completed ONLY if the check for the purchase price of shares of
3.40% Series Preferred Stock purchased (less the amount of any federal
income and backup withholding tax required to be withheld) or certificates
for shares of 3.40% Series Preferred Stock not tendered or not purchased
are to be mailed to someone other than the undersigned or to the
undersigned at an address other than that shown below the undersigned's
signature(s).
Mail: [ ] check [ ] certificates to:
Name:
----------------------------------------------------
(PLEASE PRINT)
Address:
--------------------------------------------------
------------------------------------------------------------
(INCLUDING ZIP CODE)
------------------------------------------------------------
6
NIAGARA MOHAWK
CUMULATIVE PREFERRED STOCK, 3.40% SERIES
COMPLETE ONLY IF APPLICABLE:
SOLICITED TENDERS
As described in the Offer to Purchase, dated February 27, 2002, Niagara
Mohawk will pay, in the amounts and on the terms and conditions set forth in the
Offer to Purchase, Retail Soliciting Dealer Fees (see Instruction 12) to
designated soliciting dealers (as described in the Offer to Purchase).
The above signed represents that the soliciting dealer that solicited and
obtained this tender is:
Name of Firm:
- --------------------------------------------------------------------------------
(PLEASE PRINT)
Name of Individual Broker:
- --------------------------------------------------------------------------------
Telephone Number of Broker:
- --------------------------------------------------------------------------------
Address:
- --------------------------------------------------------------------------------
(INCLUDE ZIP CODE)
If shares specified in this Letter of Transmittal are held by the above
signed as custodian, specify below each beneficial owner of such shares whose
tender you have solicited. Any questions as to what constitutes beneficial
ownership should be directed to the Depositary. If the space below is
inadequate, attach a separate signed schedule using the same format.
<Table>
<Caption>
NAME OF NUMBER OF PREFERRED SHARES
BENEFICIAL OWNER (MUST BE LESS THAN 2,500)
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
</Table>
The acceptance of compensation by such soliciting dealer will constitute a
representation by it that (a) it has complied with the applicable requirements
of the Securities Exchange Act of 1934, as amended, and the applicable rules and
regulations thereunder, in connection with such solicitation; (b) it is entitled
to such compensation for such solicitation under the terms and conditions of the
Offer to Purchase; (c) in soliciting a tender, it has used no solicitation
materials other than those furnished by Niagara Mohawk; and (d) if it is a
foreign broker or dealer not eligible for membership in the National Association
of Securities Dealers, Inc. (the "NASD"), it has agreed to conform to the NASD's
Rules of Fair Practice in making solicitations. See also Instruction 12.
SOLICITATION FEE PAYMENT INSTRUCTIONS
ISSUE CHECK TO:
Firm:
- --------------------------------------------------------------------------------
(PLEASE PRINT)
Attention:
- --------------------------------------------------------------------------------
Address:
- --------------------------------------------------------------------------------
Phone Number:
---------------------
Taxpayer Identification or Social Security Number:
------------------------
7
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER
1. SIGNATURES ON LETTER OF TRANSMITTAL; STOCK POWERS AND ENDORSEMENTS. If
this Letter of Transmittal is signed by the registered holder(s) of the shares
of 3.40% Series Preferred Stock tendered hereby, the signature(s) must
correspond with the name(s) as written on the face of the certificates without
alteration, enlargement or any change whatsoever.
If any of the shares of 3.40% Series Preferred Stock tendered hereby are
held of record by two or more persons, all such persons must sign this Letter of
Transmittal.
If any of the shares of 3.40% Series Preferred Stock tendered hereby are
registered in different names on different certificates, it will be necessary to
complete, sign and submit as many separate Letters of Transmittal as there are
different registrations of certificates.
If this Letter of Transmittal is signed by the registered holder(s) of the
shares of 3.40% Series Preferred Stock tendered hereby, no endorsements of
certificates or separate stock powers are required unless payment of the
purchase price is to be made, or shares of 3.40% Series Preferred Stock not
tendered or not purchased are to be returned, in the name of any person other
than the registered holder(s). Signatures on any such certificates or stock
powers must be guaranteed by an Eligible Institution (as defined in Instruction
2).
If this Letter of Transmittal is signed by a person other than the
registered holder(s) of the shares of 3.40% Series Preferred Stock tendered
hereby, certificates must be endorsed or accompanied by appropriate stock
powers, in either case, signed exactly as the name(s) of the registered
holder(s) appear(s) on the certificates for such shares of 3.40% Series
Preferred Stock. Signature(s) on any such certificates or stock powers must be
guaranteed by an Eligible Institution.
If this Letter of Transmittal or any certificate or stock power is signed
by a trustee, executor, administrator, guardian, attorney-in-fact, officer of a
corporation or other person acting in a fiduciary or representative capacity,
such person should so indicate when signing, and proper evidence satisfactory to
the Company of the authority of such person so to act must be submitted.
2. GUARANTEE OF SIGNATURES. Except as otherwise provided below, all
signatures on this Letter of Transmittal must be guaranteed by a financial
institution (including most banks, savings and loan associations and brokerage
houses) that is a member of a recognized Medallion Program approved by The
Securities Transfer Association, Inc., including the Securities Transfer Agents
Medallion Program (STAMP), the Stock Exchange Medallion Program (SEMP) and the
New York Stock Exchange, Inc. Medallion Signature Program (MSP) or any other
"eligible guarantor institution" (as such term is defined in Rule 17Ad-15 under
the Securities Exchange Act of 1934, as amended) (each an "Eligible
Institution"). Signatures on this Letter of Transmittal need not be guaranteed
(i) if this Letter of Transmittal is signed by the registered holder(s) of the
shares of 3.40% Series Preferred Stock (which term, for purposes of this
document, shall include any participant in the DTC whose name appears on a
security position listing as the owner of shares of 3.40% Series Preferred
Stock) tendered herewith and such holder(s) have not completed the boxes
entitled "Special Payment Instructions" or "Special Delivery Instructions" on
this Letter of Transmittal or (ii) if such shares of 3.40% Series Preferred
Stock is tendered for the account of an Eligible Institution. See Instruction 1
above.
3. DELIVERY OF LETTER OF TRANSMITTAL AND 3.40% SERIES PREFERRED
STOCK. This Letter of Transmittal is to be used either if certificates are to
be forwarded herewith or, unless an Agent's Message is utilized, if delivery of
shares of 3.40% Series Preferred Stock is to be made by book-entry transfer
pursuant to the procedures set forth in Section 3 of the Offer to Purchase.
Certificates for all physically delivered shares of 3.40% Series Preferred
Stock, or a confirmation of a book-entry transfer into the Depositary's account
at DTC of all shares of 3.40% Series Preferred Stock delivered electronically,
as well as a properly completed and duly executed Letter of Transmittal (or in
the case of a book-entry transfer, an Agent's Message) and any other documents
required by this Letter of Transmittal, must be received by the Depositary at
one of its addresses set forth on the front page of this Letter of Transmittal
by the Expiration Date.
The term "Agent's Message" means a message, transmitted by DTC to, and
received by, the depositary and forming a part of a book-entry confirmation
which states that DTC has received an express acknowledgment from the
participant
8
in DTC tendering the preferred shares that are the subject of such book-entry
confirmation agreeing to be bound by the terms of the Letter of Transmittal and
that we may enforce such agreement against such participant.
THE METHOD OF DELIVERY OF SHARES OF 3.40% SERIES PREFERRED STOCK AND ALL
OTHER REQUIRED DOCUMENTS IS AT THE OPTION AND RISK OF THE TENDERING SHAREHOLDER.
IF DELIVERY IS BY MAIL, WE RECOMMEND YOU USE REGISTERED MAIL WITH RETURN RECEIPT
REQUESTED, PROPERLY INSURED. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO
ENSURE TIMELY DELIVERY.
No alternative, conditional or contingent tenders will be accepted, and no
fractional shares of 3.40% Series Preferred Stock will be purchased. By
executing this Letter of Transmittal, the tendering shareholder waives any right
to receive any notice of the acceptance for payment of the shares of 3.40%
Series Preferred Stock.
4. INADEQUATE SPACE. If the space provided herein is inadequate, the
certificate numbers and/or the number of shares of 3.40% Series Preferred Stock
should be listed on a separate schedule attached hereto.
5. PARTIAL TENDERS (NOT APPLICABLE TO SHAREHOLDERS WHO TENDER BY
BOOK-ENTRY TRANSFER). If fewer than all the shares of 3.40% Series Preferred
Stock represented by any certificate delivered to the Depositary are to be
tendered, fill in the number of shares of 3.40% Series Preferred Stock which are
to be tendered in the box entitled "Number of Shares of 3.40% Series Preferred
Stock Tendered." In such case, a new certificate for the remainder of the shares
of 3.40% Series Preferred Stock represented by the old certificate will be sent
to the person(s) signing this Letter of Transmittal, unless otherwise provided
in the appropriate box on this Letter of Transmittal, as promptly as practicable
following the expiration or termination of the Offer. All shares of 3.40% Series
Preferred Stock represented by certificates delivered to the Depositary will be
deemed to have been tendered unless otherwise indicated.
6. STOCK TRANSFER TAXES. The Company will pay any stock transfer taxes
with respect to the sale and transfer of any shares of 3.40% Series Preferred
Stock to it or its order pursuant to the Offer. If, however, payment of the
purchase price is to be made to, or shares of 3.40% Series Preferred Stock not
tendered or not purchased is to be returned in the name of, any person other
than the registered holder(s), or if a transfer tax is imposed for any reason
other than the sale or transfer of shares of 3.40% Series Preferred Stock to the
Company pursuant to the Offer, then the amount of any stock transfer taxes
(whether imposed on the registered holder(s), such other person or otherwise)
will be deducted from the purchase price unless satisfactory evidence of the
payment of such taxes, or exemption therefrom, is submitted herewith.
7. SPECIAL PAYMENT AND DELIVERY INSTRUCTIONS. If the check for the
purchase price of any shares of 3.40% Series Preferred Stock purchased is to be
issued, or any shares of 3.40% Series Preferred Stock not tendered or not
purchased is to be returned, in the name of a person other than the person(s)
signing this Letter of Transmittal or if the check or any certificates for
shares of 3.40% Series Preferred Stock not tendered or not purchased are to be
mailed to someone other than the person(s) signing this Letter of Transmittal or
to the person(s) signing this Letter of Transmittal at an address other than
that shown above, the appropriate boxes on this Letter of Transmittal should be
completed. Shareholders tendering shares of 3.40% Series Preferred Stock by
book-entry transfer may request that shares of 3.40% Series Preferred Stock not
purchased be credited to such account at any of the book-entry transfer
facilities as such shareholder may designate under "Special Payment
Instructions" above. If no such instructions are given, any such shares of 3.40%
Series Preferred Stock not purchased will be returned by crediting the account
at the book-entry transfer facilities at DTC.
8. SUBSTITUTE FORM W-9 AND W-8BEN. Under the federal income tax laws, the
Depositary will be required to withhold 30% of the amount of any payments made
to certain shareholders pursuant to the Offer, as described below. In order to
avoid such backup withholding, each tendering shareholder, and, if applicable,
each other payee, must provide the Depositary with such shareholder's or payee's
correct taxpayer identification number and certify that such shareholder or
payee is not subject to such backup withholding by completing the substitute
Form W-9 included below. In general, if a shareholder or payee is an individual,
the taxpayer identification number is the Social Security number of such
individual. If the Depositary is not provided with the correct taxpayer
identification number, the shareholder or payee may be subject to a $50 penalty
imposed by the Internal Revenue Service. Certain shareholders or payees
(including, among others, all corporations and certain foreign individuals) are
not subject to these backup withholding and reporting requirements. To avoid
possible erroneous backup withholding, a shareholder who is exempt from backup
withholding should complete the substitute Form W-9 by providing his or her
correct TIN, signing and dating the form and writing "exempt" on the face of the
form. Noncorporate foreign shareholders must instead submit to the Depositary a
properly completed Form W-8BEN, Certificate of Foreign Status (which the
Depositary will provide upon request), signed under penalties of perjury,
attesting to such person's exempt status. For further information concerning
backup withholding and instructions
9
for completing the substitute Form W-9 (including how to obtain a taxpayer
identification number if you do not have one and how to complete the substitute
Form W-9 if shares are held in more than one name), consult the enclosed
Guidelines for Certification of Taxpayer Identification Number on substitute
Form W-9.
Failure to complete the substitute Form W-9 or Form W-8BEN will not, by
itself, cause shares of 3.40% Series Preferred Stock to be deemed invalidly
tendered but may require the Depositary to withhold 30% of the amount of any
payments made pursuant to the Offer. Backup withholding is not an additional
federal income tax. Rather, the federal income tax liability of a person subject
to backup withholding will be reduced by the amount of tax withheld. If
withholding results in an overpayment of taxes, a refund may be obtained
provided that the required information is furnished to the Internal Revenue
Service. NOTE: FAILURE TO COMPLETE AND RETURN THE SUBSTITUTE FORM W-9 MAY RESULT
IN BACKUP WITHHOLDING OF 30% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER.
PLEASE REVIEW THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER
IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
9. MUTILATED, LOST, STOLEN OR DESTROYED CERTIFICATES. If a certificate
that represents shares of 3.40% Series Preferred Stock has been mutilated, lost,
stolen or destroyed, the holder should (i) complete this Letter of Transmittal
and check the appropriate box and (ii) contact the Depositary immediately. The
Depositary will provide such holder with all necessary forms and instructions to
replace any mutilated, lost, stolen or destroyed certificates. The holder may
also be required to give the Company a bond as indemnity against any claim that
may be made against it with respect to the certificate(s) alleged to have been
mutilated, lost, stolen or destroyed. This Letter of Transmittal and related
documents cannot be processed until the procedures for replacing mutilated,
lost, stolen or destroyed certificates have been followed.
10. IRREGULARITIES. All questions as to the purchase price, the form of
documents, and the validity, eligibility, including time of receipt, and
acceptance of any tender of shares of 3.40% Series Preferred Stock will be
determined by the Company, in its sole discretion, and its determination shall
be final and binding. The Company reserves the absolute right to reject any or
all tenders of shares of 3.40% Series Preferred Stock that it determines are not
in proper form or the acceptance for payment of or payment for shares of 3.40%
Series Preferred Stock that may, in the opinion of the Company's counsel, be
unlawful. Except as otherwise provided in the Offer to Purchase, the Company
also reserves the absolute right to waive any of the conditions to the Offer or
any defect or irregularity in any tender of shares of 3.40% Series Preferred
Stock, and its interpretation of the terms and conditions of the Offer,
including these instructions, shall be final and binding. Unless waived, any
defects or irregularities in connection with tenders must be cured within such
time as the Company shall determine.
11. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Requests for assistance
may be made to the Information Agent or the Dealer Manager at their respective
addresses or telephone numbers set forth on the back cover of this Letter of
Transmittal. Additional copies of the Offer to Purchase and this Letter of
Transmittal may be obtained from the Information Agent.
12. RETAIL SOLICITING DEALER FEE INSTRUCTIONS. Upon the terms and subject
to the conditions set forth in this Letter of Transmittal and the Offer to
Purchase, in the event that the relevant beneficial owner so designates, the
Company will pay, promptly after the Expiration Date, to persons who were
responsible for soliciting tenders from beneficial owners whose individual
ownership is less than 2,500 shares of 3.40% Series Preferred Stock, a fee (the
"Retail Soliciting Dealer Fee") equal to $1.50 per share of 3.40% Series
Preferred Stock for which instructions to tender have been given due to the
efforts of such soliciting person, provided that the instructions and Letter of
Transmittal relating thereto have been validly delivered. The "Solicited Tenders
Box" should be completed to designate a soliciting dealer. No person may receive
the Retail Soliciting Dealer Fee unless such person is (i) a broker or dealer in
securities, including the dealer manager in its capacity as a dealer or broker,
which is a member of any national securities exchange or of the National
Association of Securities Dealers, Inc. ("NASD"), (ii) a foreign broker or
dealer not eligible for membership in the NASD which agrees to conform to the
NASD's Rules of Fair Practice in soliciting tenders outside the U.S. to the same
extent as though it were an NASD member or (iii) a bank or trust company legally
authorized to receive such fees. Beneficial owners are able to nominate such
retail soliciting dealers in the appropriate section of this Letter of
Transmittal. Participants in DTC will be required to undertake to distribute the
related Retail Soliciting Dealer Fee to such persons as appropriate. Neither the
Company nor the Dealer Manager will be responsible for making such distribution
or for ensuring that DTC participants make such distribution.
10
<Table>
- ---------------------------------------------------------------------------------------------------------------------------
SUBSTITUTE PART 1 -- Taxpayer Identification
FORM W-9 Number -- For all accounts, enter your
DEPARTMENT OF THE TREASURY taxpayer identification number in the
INTERNAL REVENUE SERVICE appropriate box. For most individuals and
sole proprietors, this is your Social --------------------------------------------
Security Number. For other entities, it is Social Security Number
your Employer Identification Number. If you
do not have a number, see "How to Obtain a OR
TIN" in the enclosed Guidelines. Note: If ---------------------------------------
the account is in more than one name, see Employer Identification Number
the chart in the enclosed Guidelines to
determine what number to enter.
------------------------------------------------------------------------------------------
PART II -- Certification -- Under penalties of perjury, I certify that:
(1)(a) The number shown on this form is my correct taxpayer identification number or (b) a
taxpayer identification number has not been issued to me and either (i) I have mailed or
delivered an application to receive a taxpayer identification number to the appropriate
Internal Revenue Service Center or Social Security Administration Office or (ii) I intend
to mail or deliver an application in the near future. I understand that if I do not provide
a taxpayer identification number by the time payment is made to me pursuant to the Offer,
30% of all reportable payments made to me pursuant to the Offer will be withheld;
(2) I am not subject to backup withholding either because (a) I am exempt from backup
withholding, or (b) I have not been notified by the Internal Revenue Service ("IRS") that I
am subject to backup withholding as a result of a failure to report all interest or
PAYER'S REQUEST FOR TAXPAYER dividends, or (c) after being so notified, the IRS had notified me that I am no longer
IDENTIFICATION NUMBER subject to backup withholding;
(3) I am a U.S. person (including a U.S. resident alien); and
(4) Any information provided on this form is true, correct and complete.
- ---------------------------------------------------------------------------------------------------------------------------
CERTIFICATION INSTRUCTIONS -- You must cross out item (2) above if you have been notified by the
IRS that you are subject to backup withholding because of underreporting interest or dividends PART III
on your tax return. However, if after being notified by the IRS that you were subject to backup Awaiting TIN [ ]
withholding you received another notification from the IRS stating that you are no longer
subject to backup withholding, do not cross out item (2). If you are awaiting the issuance of a
taxpayer identification number, check the box in Part III. If you are exempt from backup PART IV
withholding, check the box in Part IV. Exempt from Backup
Withholding [ ]
- ---------------------------------------------------------------------------------------------------------------------------
Signature:
- ---------------------------------------------------------------------------------------------------------------------------
Name: Date:
--------------------------------------------------------------------------------------------------------------------------
Address:
--------------------------------------------------------------------------------------------------------------------------
(Please Print)
</Table>
Check appropriate box: [ ] Individual/Sole proprietor [ ] Corporation
[ ] Partnership [ ] Other
- --------------------------------------------------------------------------------
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP
WITHHOLDING OF 30% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER. PLEASE
REVIEW ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER
ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
- --------------------------------------------------------------------------------
11
Questions regarding how to tender and requests for additional copies of this
document, the Offer to Purchase or other documents related to the Offer should
be directed to the Information Agent.
The Information Agent for the Offer is:
D.F. KING & CO., INC.
77 Water Street
New York, NY 10005
(888) 414-5566 (toll free)
Questions regarding the terms of the offer should be directed to the Dealer
Manager.
The Dealer Manager for the Offer is:
MERRILL LYNCH & CO.
4 World Financial Center, 7th Floor
New York, NY 10080
Attention: Liability Management Group
(888) ML4-TNDR (654-8637)
LETTER OF TRANSMITTAL
OF
NIAGARA MOHAWK POWER CORPORATION
PURSUANT TO THE OFFER TO PURCHASE
DATED FEBRUARY 27, 2002
THIS LETTER OF TRANSMITTAL IS BEING USED WITH RESPECT TO
CUMULATIVE PREFERRED STOCK, 3.60% SERIES
(CUSIP NO. 653522300)
AT A PURCHASE PRICE OF $67.16 PER SHARE
THE OFFER AND YOUR WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY
TIME, ON WEDNESDAY, MARCH 27, 2002, UNLESS EXTENDED OR EARLIER TERMINATED (SUCH
TIME AND DATE, AS THE SAME MAY BE EXTENDED OR TERMINATED, AN "EXPIRATION DATE").
The Depositary for the Offer is:
THE BANK OF NEW YORK
<Table>
By Mail: By Hand: By Overnight Delivery:
The Bank of New York The Bank of New York The Bank of New York
Niagara Mohawk PFD Tender Reorganization Services Niagara Mohawk PFD Tender
PO Box 859208 One Wall Street -- 3rd Floor 165 Bay State Road
Braintree, MA 02185-9208 New York, NY 10286 Braintree, MA 02184
</Table>
By Facsimile:
(781) 380-3388
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET FORTH
ABOVE OR TRANSMISSION OF THIS LETTER OF TRANSMITTAL
VIA A FACSIMILE NUMBER OTHER THAN AS LISTED ABOVE WILL NOT CONSTITUTE A VALID
DELIVERY TO THE DEPOSITARY.
You must sign this Letter of Transmittal in the appropriate space therefor
provided below.
YOU SHOULD READ THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL
CAREFULLY BEFORE YOU COMPLETE THIS LETTER OF TRANSMITTAL.
This Letter of Transmittal is to be used if certificates are to be forwarded
herewith or, unless an Agent's Message (as defined in the Offer to Purchase) is
utilized, if delivery of 3.60% Series Preferred Stock (as defined below) is to
be made by book-entry transfer to the Depositary's account at The Depository
Trust Company ("DTC") pursuant to the procedures set forth in Section 3 of the
Offer to Purchase.
IF YOU HAVE ANY QUESTIONS ABOUT HOW TO FILL OUT THIS LETTER OF TRANSMITTAL
PLEASE CONTACT D.F. KING & CO., THE INFORMATION AGENT, AT (888) 414-5566 (TOLL
FREE).
<Table>
- ------------------------------------------------------------------------------------------------------------------
DESCRIPTION OF 3.60% SERIES PREFERRED STOCK TENDERED
- ------------------------------------------------------------------------------------------------------------------
NAME(S) AND ADDRESS(ES) OF REGISTERED HOLDER(S)
(PLEASE FILL IN, IF BLANK, EXACTLY AS NAME(S) APPEAR(S) ON 3.60% SERIES PREFERRED STOCK TENDERED
SHARE CERTIFICATE(S)) (ATTACH ADDITIONAL LIST IF NECESSARY)
- ------------------------------------------------------------------------------------------------------------------
TOTAL NUMBER
OF SHARES OF NUMBER OF
3.60% SERIES SHARES OF
PREFERRED STOCK 3.60% SERIES
REPRESENTED PREFERRED
CERTIFICATE BY STOCK
NUMBER(S)* CERTIFICATE(S)* TENDERED**
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
TOTAL NUMBER
OF SHARES OF
3.60% SERIES
PREFERRED STOCK
- ------------------------------------------------------------------------------------------------------------------
* Need not be completed by shareholders tendering by book-entry transfer.
** Unless otherwise indicated, it will be assumed that all shares of 3.60% Series Preferred Stock represented by
any certificate delivered to the Depositary are being tendered. See Instruction 5 of this Letter of
Transmittal.
- ------------------------------------------------------------------------------------------------------------------
</Table>
Please check the applicable box below.
<Table>
[ ] I have lost my certificate(s) that represented --------
shares of Cumulative Preferred Stock, 3.60% Series and
require assistance in obtaining replacement certificate(s).
I understand that checking this box does not mean that my
shares have been validly tendered and that I must contact
the Depositary to obtain instructions for replacing lost
certificates. (See Instruction 9 of this Letter of
Transmittal.)
[ ] CHECK HERE IF CERTIFICATES FOR TENDERED 3.60% SERIES
PREFERRED STOCK ARE ENCLOSED HEREWITH.
[ ] CHECK HERE IF TENDERED 3.60% SERIES PREFERRED STOCK IS BEING
DELIVERED BY BOOK-ENTRY TRANSFER TO THE DEPOSITARY'S ACCOUNT
AT THE DTC AND COMPLETE THE FOLLOWING:
</Table>
Name of Tendering Institution
- --------------------------------------------------------------------------------
Account Number
- --------------------------------------------------------------------------------
Transaction Code Number
- --------------------------------------------------------------------------------
2
NOTE: SIGNATURES MUST BE PROVIDED BELOW.
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY.
Ladies and Gentlemen:
The undersigned hereby tenders to Niagara Mohawk Power Corporation (the
"Company"), a New York corporation, the shares in the amount set forth in the
box "Description of 3.60% Series Preferred Stock Tendered" pursuant to the
Company's offer to purchase any and all of its Cumulative Preferred Stock, 3.60%
Series (the "3.60% Series Preferred Stock"), at $67.16 per share, upon the terms
and subject to the conditions set forth in its Offer to Purchase dated February
27, 2002 (the "Offer to Purchase") and in this Letter of Transmittal (which
together constitute the "Offer").
Upon the terms and subject to the conditions of the Offer and effective
upon acceptance for payment of and payment for the 3.60% Series Preferred Stock
tendered herewith, the undersigned hereby sells, assigns and transfers to, or
upon the order of, the Company all right, title and interest in and to all the
shares of 3.60% Series Preferred Stock that are being tendered herewith, or
orders the registration of such shares of 3.60% Series Preferred Stock tendered
by book-entry transfer that are purchased pursuant to the Offer to or upon the
order of the Company, and appoints the Depositary the true and lawful agent and
attorney-in-fact of the undersigned with respect to such shares of 3.60% Series
Preferred Stock, with full power of substitution (such power of attorney being
deemed to be an irrevocable power coupled with an interest), to:
- deliver certificates representing such shares of 3.60% Series Preferred
Stock or transfer ownership of such shares of 3.60% Series Preferred
Stock on the account books maintained by the DTC, together, in any such
case, with all accompanying evidences of transfer and authenticity, to or
upon the order of the Company;
- present such shares of 3.60% Series Preferred Stock for transfer on the
books of the Company; and
- receive all benefits and otherwise exercise all rights of beneficial
ownership of such shares of 3.60% Series Preferred Stock, all in
accordance with the terms of the Offer.
The undersigned hereby represents and warrants to the Company that:
- the undersigned has full power and authority to tender, sell, assign and
transfer the shares of 3.60% Series Preferred Stock tendered hereby and
that when the same are accepted for payment by the Company, the Company
will acquire good marketable and unencumbered title thereto, free and
clear of all liens, restrictions, charges and encumbrances and not
subject to any adverse claims;
- the undersigned understands that tenders of shares pursuant to any one of
the procedures described in Section 3 of the Offer to Purchase and in the
instructions to this Letter of Transmittal will constitute the
undersigned's acceptance of the terms and conditions of the Offer,
including the undersigned's representation and warranty that (a) the
undersigned has a "net long position," within the meaning of Rule 14e-4
promulgated under the Securities Exchange Act of 1934, as amended, in the
shares or equivalent securities at least equal to the shares being
tendered, and (b) the tender of shares complies with Rule 14e-4;
- the undersigned will, upon request, execute and deliver any additional
documents deemed by the Depositary or the Company to be necessary or
desirable to complete the sale, assignment and transfer of the shares of
3.60% Series Preferred Stock tendered hereby; and
- the undersigned has read, understands and agrees to all of the terms of
the Offer.
The undersigned understands that the valid tenders of the 3.60% Series
Preferred Stock pursuant to any one of the procedures described in Section 3 of
the Offer to Purchase and in the instructions hereto will constitute an
agreement between the undersigned and the Company upon the terms and subject to
the conditions of the Offer. The undersigned acknowledges that under no
circumstances will the Company pay interest on the purchase price, including,
without limitation, by reason of any delay in making payment.
The undersigned recognizes that, under certain circumstances set forth in
the Offer to Purchase, the Company may terminate or amend the Offer or may
postpone the acceptance for payment of, or the payment for, shares of 3.60%
Series
3
Preferred Stock tendered or may not be required to purchase any shares of the
3.60% Series Preferred Stock tendered hereby or may accept for payment fewer
than all of the shares of 3.60% Series Preferred Stock tendered hereby.
Unless otherwise indicated under "Special Payment Instructions" of this
Letter of Transmittal, please issue the check for the purchase price of any
shares of 3.60% Series Preferred Stock purchased, and return any shares of 3.60%
Series Preferred Stock not tendered or not purchased, in the name(s) of the
undersigned and, in the case of shares of 3.60% Series Preferred Stock tendered
by book-entry transfer, by credit to the account at the DTC. Similarly, unless
otherwise indicated under "Special Delivery Instructions" of this Letter of
Transmittal, please mail the check for the purchase price of any shares of 3.60%
Series Preferred Stock purchased and any certificates for shares of 3.60% Series
Preferred Stock not tendered or not purchased (and accompanying documents, as
appropriate) to the undersigned at the address shown below the undersigned's
signature(s). In the event that both "Special Payment Instructions" and "Special
Delivery Instructions" are completed, please issue the check for the purchase
price of any shares of 3.60% Series Preferred Stock purchased and return any
shares of 3.60% Series Preferred Stock not tendered or not purchased in the
name(s) of, and mail said check and any certificates to, the person(s) so
indicated. The undersigned recognizes that the Company has no obligation,
pursuant to the "Special Payment Instructions," to transfer any shares of 3.60%
Series Preferred Stock from the name of the registered holder(s) thereof if the
Company does not accept for payment any shares of the 3.60% Series Preferred
Stock so tendered.
All authority conferred or agreed to be conferred by this Letter of
Transmittal will survive the death or incapacity of the undersigned, and any
obligation of the undersigned will be binding on the heirs, personal
representatives, executors, administrators, successors, assigns, trustees in
bankruptcy and legal representatives of the undersigned. Except as stated in the
Offer to Purchase, this tender is irrevocable.
4
PLEASE SIGN HERE
(TO BE COMPLETED BY ALL TENDERING HOLDERS OF 3.60% SERIES PREFERRED STOCK)
This Letter of Transmittal must be signed by the registered holder(s) of
3.60% Series Preferred Stock exactly as their name(s) appear(s) on
certificate(s) for shares of 3.60% Series Preferred Stock or, if tendered by a
participant in the DTC system, exactly as such participant's name appears on a
security position listing as the owner of shares of 3.60% Series Preferred
Stock, or by person(s) authorized to become registered holders of shares of
3.60% Series Preferred Stock by endorsements on certificates for shares of 3.60%
Series Preferred Stock or by stock powers transmitted with this Letter of
Transmittal. Endorsements on shares of 3.60% Series Preferred Stock and
signatures on stock powers by registered holders of shares of 3.60% Series
Preferred Stock not executing this Letter of Transmittal must be guaranteed by
an Eligible Institution. See Instructions 1 and 2 below. If signature is by a
trustee, executor, administrator, guardian, attorney-in-fact, officers of a
corporation or other person acting in a fiduciary or representative capacity,
such person must set forth his or her full title below under "Capacity" and
submit evidence satisfactory to the Company of such person's authority to so
act. See Instruction 1 below.
- --------------------------------------------------------------------------------
Signature(s) of Owner(s)
- --------------------------------------------------------------------------------
Signature(s) of Owner(s)
Dated:
- ------------------------------------ , 2002
Name(s):
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Please Print)
Capacity (full title):
- --------------------------------------------------------------------------------
Address:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Include Zip Code)
Area Code and Telephone Number:
- --------------------------------------------------------------------------------
PLEASE COMPLETE SUBSTITUTE FORM W-9 HEREIN
GUARANTEE OF SIGNATURE(S)
(IF REQUIRED, SEE INSTRUCTIONS 1 AND 2)
Name of Firm:
- --------------------------------------------------------------------------------
Address and Telephone Number:
- --------------------------------------------------------------------------------
Authorized Signature:
- --------------------------------------------------------------------------------
Printed Name:
- --------------------------------------------------------------------------------
Title:
- --------------------------------------------------------------------------------
Dated:
- ------------------------------------ , 2002
5
------------------------------------------------------------
SPECIAL PAYMENT INSTRUCTIONS
(SEE INSTRUCTIONS 1, 2, 6 AND 7)
To be completed ONLY if the check for the purchase price of shares of
3.60% Series Preferred Stock purchased (less the amount of any federal
income and backup withholding tax required to be withheld) or certificates
for shares of 3.60% Series Preferred Stock not tendered or not purchased
are to be issued in the name of someone other the undersigned.
Mail: [ ] check [ ] certificates to:
Name:
----------------------------------------------------
(PLEASE PRINT)
Address:
--------------------------------------------------
------------------------------------------------------------
(INCLUDING ZIP CODE)
------------------------------------------------------------
(TAXPAYER IDENTIFICATION NO.)
Credit unpurchased shares of 3.60% Series Preferred Stock by book-entry to
the book-entry transfer facility account set forth below:
DTC Account Number:
-----------------------------------------------
Number of Account Party:
-----------------------------------------------
------------------------------------------------------------
------------------------------------------------------------
SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 1, 2 AND 7)
To be completed ONLY if the check for the purchase price of shares of
3.60% Series Preferred Stock purchased (less the amount of any federal
income and backup withholding tax required to be withheld) or certificates
for shares of 3.60% Series Preferred Stock not tendered or not purchased
are to be mailed to someone other than the undersigned or to the
undersigned at an address other than that shown below the undersigned's
signature(s).
Mail: [ ] check [ ] certificates to:
Name:
----------------------------------------------------
(PLEASE PRINT)
Address:
--------------------------------------------------
------------------------------------------------------------
(INCLUDING ZIP CODE)
------------------------------------------------------------
6
NIAGARA MOHAWK
CUMULATIVE PREFERRED STOCK, 3.60% SERIES
COMPLETE ONLY IF APPLICABLE:
SOLICITED TENDERS
As described in the Offer to Purchase, dated February 27, 2002, Niagara
Mohawk will pay, in the amounts and on the terms and conditions set forth in the
Offer to Purchase, Retail Soliciting Dealer Fees (see Instruction 12) to
designated soliciting dealers (as described in the Offer to Purchase).
The above signed represents that the soliciting dealer that solicited and
obtained this tender is:
Name of Firm:
- --------------------------------------------------------------------------------
(PLEASE PRINT)
Name of Individual Broker:
- --------------------------------------------------------------------------------
Telephone Number of Broker:
- --------------------------------------------------------------------------------
Address:
- --------------------------------------------------------------------------------
(INCLUDE ZIP CODE)
If shares specified in this Letter of Transmittal are held by the above
signed as custodian, specify below each beneficial owner of such shares whose
tender you have solicited. Any questions as to what constitutes beneficial
ownership should be directed to the Depositary. If the space below is
inadequate, attach a separate signed schedule using the same format.
<Table>
<Caption>
NAME OF NUMBER OF PREFERRED SHARES
BENEFICIAL OWNER (MUST BE LESS THAN 2,500)
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
</Table>
The acceptance of compensation by such soliciting dealer will constitute a
representation by it that (a) it has complied with the applicable requirements
of the Securities Exchange Act of 1934, as amended, and the applicable rules and
regulations thereunder, in connection with such solicitation; (b) it is entitled
to such compensation for such solicitation under the terms and conditions of the
Offer to Purchase; (c) in soliciting a tender, it has used no solicitation
materials other than those furnished by Niagara Mohawk; and (d) if it is a
foreign broker or dealer not eligible for membership in the National Association
of Securities Dealers, Inc. (the "NASD"), it has agreed to conform to the NASD's
Rules of Fair Practice in making solicitations. See also Instruction 12.
SOLICITATION FEE PAYMENT INSTRUCTIONS
ISSUE CHECK TO:
Firm:
- --------------------------------------------------------------------------------
(PLEASE PRINT)
Attention:
- --------------------------------------------------------------------------------
Address:
- --------------------------------------------------------------------------------
Phone Number:
---------------------
Taxpayer Identification or Social Security Number:
------------------------
7
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER
1. SIGNATURES ON LETTER OF TRANSMITTAL; STOCK POWERS AND ENDORSEMENTS. If
this Letter of Transmittal is signed by the registered holder(s) of the shares
of 3.60% Series Preferred Stock tendered hereby, the signature(s) must
correspond with the name(s) as written on the face of the certificates without
alteration, enlargement or any change whatsoever.
If any of the shares of 3.60% Series Preferred Stock tendered hereby are
held of record by two or more persons, all such persons must sign this Letter of
Transmittal.
If any of the shares of 3.60% Series Preferred Stock tendered hereby are
registered in different names on different certificates, it will be necessary to
complete, sign and submit as many separate Letters of Transmittal as there are
different registrations of certificates.
If this Letter of Transmittal is signed by the registered holder(s) of the
shares of 3.60% Series Preferred Stock tendered hereby, no endorsements of
certificates or separate stock powers are required unless payment of the
purchase price is to be made, or shares of 3.60% Series Preferred Stock not
tendered or not purchased are to be returned, in the name of any person other
than the registered holder(s). Signatures on any such certificates or stock
powers must be guaranteed by an Eligible Institution (as defined in Instruction
2).
If this Letter of Transmittal is signed by a person other than the
registered holder(s) of the shares of 3.60% Series Preferred Stock tendered
hereby, certificates must be endorsed or accompanied by appropriate stock
powers, in either case, signed exactly as the name(s) of the registered
holder(s) appear(s) on the certificates for such shares of 3.60% Series
Preferred Stock. Signature(s) on any such certificates or stock powers must be
guaranteed by an Eligible Institution.
If this Letter of Transmittal or any certificate or stock power is signed
by a trustee, executor, administrator, guardian, attorney-in-fact, officer of a
corporation or other person acting in a fiduciary or representative capacity,
such person should so indicate when signing, and proper evidence satisfactory to
the Company of the authority of such person so to act must be submitted.
2. GUARANTEE OF SIGNATURES. Except as otherwise provided below, all
signatures on this Letter of Transmittal must be guaranteed by a financial
institution (including most banks, savings and loan associations and brokerage
houses) that is a member of a recognized Medallion Program approved by The
Securities Transfer Association, Inc., including the Securities Transfer Agents
Medallion Program (STAMP), the Stock Exchange Medallion Program (SEMP) and the
New York Stock Exchange, Inc. Medallion Signature Program (MSP) or any other
"eligible guarantor institution" (as such term is defined in Rule 17Ad-15 under
the Securities Exchange Act of 1934, as amended) (each an "Eligible
Institution"). Signatures on this Letter of Transmittal need not be guaranteed
(i) if this Letter of Transmittal is signed by the registered holder(s) of the
shares of 3.60% Series Preferred Stock (which term, for purposes of this
document, shall include any participant in the DTC whose name appears on a
security position listing as the owner of shares of 3.60% Series Preferred
Stock) tendered herewith and such holder(s) have not completed the boxes
entitled "Special Payment Instructions" or "Special Delivery Instructions" on
this Letter of Transmittal or (ii) if such shares of 3.60% Series Preferred
Stock is tendered for the account of an Eligible Institution. See Instruction 1
above.
3. DELIVERY OF LETTER OF TRANSMITTAL AND 3.60% SERIES PREFERRED
STOCK. This Letter of Transmittal is to be used either if certificates are to
be forwarded herewith or, unless an Agent's Message is utilized, if delivery of
shares of 3.60% Series Preferred Stock is to be made by book-entry transfer
pursuant to the procedures set forth in Section 3 of the Offer to Purchase.
Certificates for all physically delivered shares of 3.60% Series Preferred
Stock, or a confirmation of a book-entry transfer into the Depositary's account
at DTC of all shares of 3.60% Series Preferred Stock delivered electronically,
as well as a properly completed and duly executed Letter of Transmittal (or in
the case of a book-entry transfer, an Agent's Message) and any other documents
required by this Letter of Transmittal, must be received by the Depositary at
one of its addresses set forth on the front page of this Letter of Transmittal
by the Expiration Date.
The term "Agent's Message" means a message, transmitted by DTC to, and
received by, the depositary and forming a part of a book-entry confirmation
which states that DTC has received an express acknowledgment from the
participant
8
in DTC tendering the preferred shares that are the subject of such book-entry
confirmation agreeing to be bound by the terms of the Letter of Transmittal and
that we may enforce such agreement against such participant.
THE METHOD OF DELIVERY OF SHARES OF 3.60% SERIES PREFERRED STOCK AND ALL
OTHER REQUIRED DOCUMENTS IS AT THE OPTION AND RISK OF THE TENDERING SHAREHOLDER.
IF DELIVERY IS BY MAIL, WE RECOMMEND YOU USE REGISTERED MAIL WITH RETURN RECEIPT
REQUESTED, PROPERLY INSURED. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO
ENSURE TIMELY DELIVERY.
No alternative, conditional or contingent tenders will be accepted, and no
fractional shares of 3.60% Series Preferred Stock will be purchased. By
executing this Letter of Transmittal, the tendering shareholder waives any right
to receive any notice of the acceptance for payment of the shares of 3.60%
Series Preferred Stock.
4. INADEQUATE SPACE. If the space provided herein is inadequate, the
certificate numbers and/or the number of shares of 3.60% Series Preferred Stock
should be listed on a separate schedule attached hereto.
5. PARTIAL TENDERS (NOT APPLICABLE TO SHAREHOLDERS WHO TENDER BY
BOOK-ENTRY TRANSFER). If fewer than all the shares of 3.60% Series Preferred
Stock represented by any certificate delivered to the Depositary are to be
tendered, fill in the number of shares of 3.60% Series Preferred Stock which are
to be tendered in the box entitled "Number of Shares of 3.60% Series Preferred
Stock Tendered." In such case, a new certificate for the remainder of the shares
of 3.60% Series Preferred Stock represented by the old certificate will be sent
to the person(s) signing this Letter of Transmittal, unless otherwise provided
in the appropriate box on this Letter of Transmittal, as promptly as practicable
following the expiration or termination of the Offer. All shares of 3.60% Series
Preferred Stock represented by certificates delivered to the Depositary will be
deemed to have been tendered unless otherwise indicated.
6. STOCK TRANSFER TAXES. The Company will pay any stock transfer taxes
with respect to the sale and transfer of any shares of 3.60% Series Preferred
Stock to it or its order pursuant to the Offer. If, however, payment of the
purchase price is to be made to, or shares of 3.60% Series Preferred Stock not
tendered or not purchased is to be returned in the name of, any person other
than the registered holder(s), or if a transfer tax is imposed for any reason
other than the sale or transfer of shares of 3.60% Series Preferred Stock to the
Company pursuant to the Offer, then the amount of any stock transfer taxes
(whether imposed on the registered holder(s), such other person or otherwise)
will be deducted from the purchase price unless satisfactory evidence of the
payment of such taxes, or exemption therefrom, is submitted herewith.
7. SPECIAL PAYMENT AND DELIVERY INSTRUCTIONS. If the check for the
purchase price of any shares of 3.60% Series Preferred Stock purchased is to be
issued, or any shares of 3.60% Series Preferred Stock not tendered or not
purchased is to be returned, in the name of a person other than the person(s)
signing this Letter of Transmittal or if the check or any certificates for
shares of 3.60% Series Preferred Stock not tendered or not purchased are to be
mailed to someone other than the person(s) signing this Letter of Transmittal or
to the person(s) signing this Letter of Transmittal at an address other than
that shown above, the appropriate boxes on this Letter of Transmittal should be
completed. Shareholders tendering shares of 3.60% Series Preferred Stock by
book-entry transfer may request that shares of 3.60% Series Preferred Stock not
purchased be credited to such account at any of the book-entry transfer
facilities as such shareholder may designate under "Special Payment
Instructions" above. If no such instructions are given, any such shares of 3.60%
Series Preferred Stock not purchased will be returned by crediting the account
at the book-entry transfer facilities at DTC.
8. SUBSTITUTE FORM W-9 AND W-8BEN. Under the federal income tax laws, the
Depositary will be required to withhold 30% of the amount of any payments made
to certain shareholders pursuant to the Offer, as described below. In order to
avoid such backup withholding, each tendering shareholder, and, if applicable,
each other payee, must provide the Depositary with such shareholder's or payee's
correct taxpayer identification number and certify that such shareholder or
payee is not subject to such backup withholding by completing the substitute
Form W-9 included below. In general, if a shareholder or payee is an individual,
the taxpayer identification number is the Social Security number of such
individual. If the Depositary is not provided with the correct taxpayer
identification number, the shareholder or payee may be subject to a $50 penalty
imposed by the Internal Revenue Service. Certain shareholders or payees
(including, among others, all corporations and certain foreign individuals) are
not subject to these backup withholding and reporting requirements. To avoid
possible erroneous backup withholding, a shareholder who is exempt from backup
withholding should complete the substitute Form W-9 by providing his or her
correct TIN, signing and dating the form and writing "exempt" on the face of the
form. Noncorporate foreign shareholders must instead submit to the Depositary a
properly completed Form W-8BEN, Certificate of Foreign Status (which the
Depositary will provide upon request), signed under penalties of perjury,
attesting to such person's exempt status. For further information concerning
backup withholding and instructions
9
for completing the substitute Form W-9 (including how to obtain a taxpayer
identification number if you do not have one and how to complete the substitute
Form W-9 if shares are held in more than one name), consult the enclosed
Guidelines for Certification of Taxpayer Identification Number on substitute
Form W-9.
Failure to complete the substitute Form W-9 or Form W-8BEN will not, by
itself, cause shares of 3.60% Series Preferred Stock to be deemed invalidly
tendered but may require the Depositary to withhold 30% of the amount of any
payments made pursuant to the Offer. Backup withholding is not an additional
federal income tax. Rather, the federal income tax liability of a person subject
to backup withholding will be reduced by the amount of tax withheld. If
withholding results in an overpayment of taxes, a refund may be obtained
provided that the required information is furnished to the Internal Revenue
Service. NOTE: FAILURE TO COMPLETE AND RETURN THE SUBSTITUTE FORM W-9 MAY RESULT
IN BACKUP WITHHOLDING OF 30% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER.
PLEASE REVIEW THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER
IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
9. MUTILATED, LOST, STOLEN OR DESTROYED CERTIFICATES. If a certificate
that represents shares of 3.60% Series Preferred Stock has been mutilated, lost,
stolen or destroyed, the holder should (i) complete this Letter of Transmittal
and check the appropriate box and (ii) contact the Depositary immediately. The
Depositary will provide such holder with all necessary forms and instructions to
replace any mutilated, lost, stolen or destroyed certificates. The holder may
also be required to give the Company a bond as indemnity against any claim that
may be made against it with respect to the certificate(s) alleged to have been
mutilated, lost, stolen or destroyed. This Letter of Transmittal and related
documents cannot be processed until the procedures for replacing mutilated,
lost, stolen or destroyed certificates have been followed.
10. IRREGULARITIES. All questions as to the purchase price, the form of
documents, and the validity, eligibility, including time of receipt, and
acceptance of any tender of shares of 3.60% Series Preferred Stock will be
determined by the Company, in its sole discretion, and its determination shall
be final and binding. The Company reserves the absolute right to reject any or
all tenders of shares of 3.60% Series Preferred Stock that it determines are not
in proper form or the acceptance for payment of or payment for shares of 3.60%
Series Preferred Stock that may, in the opinion of the Company's counsel, be
unlawful. Except as otherwise provided in the Offer to Purchase, the Company
also reserves the absolute right to waive any of the conditions to the Offer or
any defect or irregularity in any tender of shares of 3.60% Series Preferred
Stock, and its interpretation of the terms and conditions of the Offer,
including these instructions, shall be final and binding. Unless waived, any
defects or irregularities in connection with tenders must be cured within such
time as the Company shall determine.
11. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Requests for assistance
may be made to the Information Agent or the Dealer Manager at their respective
addresses or telephone numbers set forth on the back cover of this Letter of
Transmittal. Additional copies of the Offer to Purchase and this Letter of
Transmittal may be obtained from the Information Agent.
12. RETAIL SOLICITING DEALER FEE INSTRUCTIONS. Upon the terms and subject
to the conditions set forth in this Letter of Transmittal and the Offer to
Purchase, in the event that the relevant beneficial owner so designates, the
Company will pay, promptly after the Expiration Date, to persons who were
responsible for soliciting tenders from beneficial owners whose individual
ownership is less than 2,500 shares of 3.60% Series Preferred Stock, a fee (the
"Retail Soliciting Dealer Fee") equal to $1.50 per share of 3.60% Series
Preferred Stock for which instructions to tender have been given due to the
efforts of such soliciting person, provided that the instructions and Letter of
Transmittal relating thereto have been validly delivered. The "Solicited Tenders
Box" should be completed to designate a soliciting dealer. No person may receive
the Retail Soliciting Dealer Fee unless such person is (i) a broker or dealer in
securities, including the dealer manager in its capacity as a dealer or broker,
which is a member of any national securities exchange or of the National
Association of Securities Dealers, Inc. ("NASD"), (ii) a foreign broker or
dealer not eligible for membership in the NASD which agrees to conform to the
NASD's Rules of Fair Practice in soliciting tenders outside the U.S. to the same
extent as though it were an NASD member or (iii) a bank or trust company legally
authorized to receive such fees. Beneficial owners are able to nominate such
retail soliciting dealers in the appropriate section of this Letter of
Transmittal. Participants in DTC will be required to undertake to distribute the
related Retail Soliciting Dealer Fee to such persons as appropriate. Neither the
Company nor the Dealer Manager will be responsible for making such distribution
or for ensuring that DTC participants make such distribution.
10
<Table>
- ---------------------------------------------------------------------------------------------------------------------------
SUBSTITUTE PART 1 -- Taxpayer Identification
FORM W-9 Number -- For all accounts, enter your
DEPARTMENT OF THE TREASURY taxpayer identification number in the
INTERNAL REVENUE SERVICE appropriate box. For most individuals and
sole proprietors, this is your Social --------------------------------------------
Security Number. For other entities, it is Social Security Number
your Employer Identification Number. If you
do not have a number, see "How to Obtain a OR
TIN" in the enclosed Guidelines. Note: If ---------------------------------------
the account is in more than one name, see Employer Identification Number
the chart in the enclosed Guidelines to
determine what number to enter.
------------------------------------------------------------------------------------------
PART II -- Certification -- Under penalties of perjury, I certify that:
(1)(a) The number shown on this form is my correct taxpayer identification number or (b) a
taxpayer identification number has not been issued to me and either (i) I have mailed or
delivered an application to receive a taxpayer identification number to the appropriate
Internal Revenue Service Center or Social Security Administration Office or (ii) I intend
to mail or deliver an application in the near future. I understand that if I do not provide
a taxpayer identification number by the time payment is made to me pursuant to the Offer,
30% of all reportable payments made to me pursuant to the Offer will be withheld;
(2) I am not subject to backup withholding either because (a) I am exempt from backup
withholding, or (b) I have not been notified by the Internal Revenue Service ("IRS") that I
am subject to backup withholding as a result of a failure to report all interest or
PAYER'S REQUEST FOR TAXPAYER dividends, or (c) after being so notified, the IRS had notified me that I am no longer
IDENTIFICATION NUMBER subject to backup withholding;
(3) I am a U.S. person (including a U.S. resident alien); and
(4) Any information provided on this form is true, correct and complete.
- ---------------------------------------------------------------------------------------------------------------------------
CERTIFICATION INSTRUCTIONS -- You must cross out item (2) above if you have been notified by the
IRS that you are subject to backup withholding because of underreporting interest or dividends PART III
on your tax return. However, if after being notified by the IRS that you were subject to backup Awaiting TIN [ ]
withholding you received another notification from the IRS stating that you are no longer
subject to backup withholding, do not cross out item (2). If you are awaiting the issuance of a
taxpayer identification number, check the box in Part III. If you are exempt from backup PART IV
withholding, check the box in Part IV. Exempt from Backup
Withholding [ ]
- ---------------------------------------------------------------------------------------------------------------------------
Signature:
- ---------------------------------------------------------------------------------------------------------------------------
Name: Date:
--------------------------------------------------------------------------------------------------------------------------
Address:
--------------------------------------------------------------------------------------------------------------------------
(Please Print)
</Table>
Check appropriate box: [ ] Individual/Sole proprietor [ ] Corporation
[ ] Partnership [ ] Other
- --------------------------------------------------------------------------------
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP
WITHHOLDING OF 30% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER. PLEASE
REVIEW ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER
ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
- --------------------------------------------------------------------------------
11
Questions regarding how to tender and requests for additional copies of this
document, the Offer to Purchase or other documents related to the Offer should
be directed to the Information Agent.
The Information Agent for the Offer is:
D.F. KING & CO., INC.
77 Water Street
New York, NY 10005
(888) 414-5566 (toll free)
Questions regarding the terms of the offer should be directed to the Dealer
Manager.
The Dealer Manager for the Offer is:
MERRILL LYNCH & CO.
4 World Financial Center, 7th Floor
New York, NY 10080
Attention: Liability Management Group
(888) ML4-TNDR (654-8637)
LETTER OF TRANSMITTAL
OF
NIAGARA MOHAWK POWER CORPORATION
PURSUANT TO THE OFFER TO PURCHASE
DATED FEBRUARY 27, 2002
THIS LETTER OF TRANSMITTAL IS BEING USED WITH RESPECT TO
CUMULATIVE PREFERRED STOCK, 3.90% SERIES
(CUSIP NO. 653522409)
AT A PURCHASE PRICE OF $72.76 PER SHARE
THE OFFER AND YOUR WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY
TIME, ON WEDNESDAY, MARCH 27, 2002, UNLESS EXTENDED OR EARLIER TERMINATED (SUCH
TIME AND DATE, AS THE SAME MAY BE EXTENDED OR TERMINATED, AN "EXPIRATION DATE").
The Depositary for the Offer is:
THE BANK OF NEW YORK
<Table>
By Mail: By Hand: By Overnight Delivery:
The Bank of New York The Bank of New York The Bank of New York
Niagara Mohawk PFD Tender Reorganization Services Niagara Mohawk PFD Tender
PO Box 859208 One Wall Street -- 3rd Floor 165 Bay State Road
Braintree, MA 02185-9208 New York, NY 10286 Braintree, MA 02184
</Table>
By Facsimile:
(781) 380-3388
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET FORTH
ABOVE OR TRANSMISSION OF THIS LETTER OF TRANSMITTAL VIA A FACSIMILE NUMBER OTHER
THAN AS LISTED ABOVE WILL NOT CONSTITUTE A VALID DELIVERY TO THE DEPOSITARY.
You must sign this Letter of Transmittal in the appropriate space therefor
provided below.
YOU SHOULD READ THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL
CAREFULLY BEFORE YOU COMPLETE THIS LETTER OF TRANSMITTAL.
This Letter of Transmittal is to be used if certificates are to be forwarded
herewith or, unless an Agent's Message (as defined in the Offer to Purchase) is
utilized, if delivery of 3.90% Series Preferred Stock (as defined below) is to
be made by book-entry transfer to the Depositary's account at The Depository
Trust Company ("DTC") pursuant to the procedures set forth in Section 3 of the
Offer to Purchase.
IF YOU HAVE ANY QUESTIONS ABOUT HOW TO FILL OUT THIS LETTER OF TRANSMITTAL
PLEASE CONTACT D.F. KING & CO., THE INFORMATION AGENT, AT (888) 414-5566 (TOLL
FREE).
<Table>
- ------------------------------------------------------------------------------------------------------------------
DESCRIPTION OF 3.90% SERIES PREFERRED STOCK TENDERED
- ------------------------------------------------------------------------------------------------------------------
NAME(S) AND ADDRESS(ES) OF REGISTERED HOLDER(S)
(PLEASE FILL IN, IF BLANK, EXACTLY AS NAME(S) APPEAR(S) ON 3.90% SERIES PREFERRED STOCK TENDERED
SHARE CERTIFICATE(S)) (ATTACH ADDITIONAL LIST IF NECESSARY)
- ------------------------------------------------------------------------------------------------------------------
TOTAL NUMBER
OF SHARES OF NUMBER OF
3.90% SERIES SHARES OF
PREFERRED STOCK 3.90% SERIES
REPRESENTED PREFERRED
CERTIFICATE BY STOCK
NUMBER(S)* CERTIFICATE(S)* TENDERED**
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
TOTAL NUMBER
OF SHARES OF
3.90% SERIES
PREFERRED STOCK
- ------------------------------------------------------------------------------------------------------------------
* Need not be completed by shareholders tendering by book-entry transfer.
** Unless otherwise indicated, it will be assumed that all shares of 3.90% Series Preferred Stock represented by
any certificate delivered to the Depositary are being tendered. See Instruction 5 of this Letter of
Transmittal.
- ------------------------------------------------------------------------------------------------------------------
</Table>
Please check the applicable box below.
<Table>
[ ] I have lost my certificate(s) that represented --------
shares of Cumulative Preferred Stock, 3.90% Series and
require assistance in obtaining replacement certificate(s).
I understand that checking this box does not mean that my
shares have been validly tendered and that I must contact
the Depositary to obtain instructions for replacing lost
certificates. (See Instruction 9 of this Letter of
Transmittal.)
[ ] CHECK HERE IF CERTIFICATES FOR TENDERED 3.90% SERIES
PREFERRED STOCK ARE ENCLOSED HEREWITH.
[ ] CHECK HERE IF TENDERED 3.90% SERIES PREFERRED STOCK IS BEING
DELIVERED BY BOOK-ENTRY TRANSFER TO THE DEPOSITARY'S ACCOUNT
AT THE DTC AND COMPLETE THE FOLLOWING:
</Table>
Name of Tendering Institution
- --------------------------------------------------------------------------------
Account Number
- --------------------------------------------------------------------------------
Transaction Code Number
- --------------------------------------------------------------------------------
2
NOTE: SIGNATURES MUST BE PROVIDED BELOW.
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY.
Ladies and Gentlemen:
The undersigned hereby tenders to Niagara Mohawk Power Corporation (the
"Company"), a New York corporation, the shares in the amount set forth in the
box "Description of 3.90% Series Preferred Stock Tendered" pursuant to the
Company's offer to purchase any and all of its Cumulative Preferred Stock, 3.90%
Series (the "3.90% Series Preferred Stock"), at $72.76 per share, upon the terms
and subject to the conditions set forth in its Offer to Purchase dated February
27, 2002 (the "Offer to Purchase") and in this Letter of Transmittal (which
together constitute the "Offer").
Upon the terms and subject to the conditions of the Offer and effective
upon acceptance for payment of and payment for the 3.90% Series Preferred Stock
tendered herewith, the undersigned hereby sells, assigns and transfers to, or
upon the order of, the Company all right, title and interest in and to all the
shares of 3.90% Series Preferred Stock that are being tendered herewith, or
orders the registration of such shares of 3.90% Series Preferred Stock tendered
by book-entry transfer that are purchased pursuant to the Offer to or upon the
order of the Company, and appoints the Depositary the true and lawful agent and
attorney-in-fact of the undersigned with respect to such shares of 3.90% Series
Preferred Stock, with full power of substitution (such power of attorney being
deemed to be an irrevocable power coupled with an interest), to:
- deliver certificates representing such shares of 3.90% Series Preferred
Stock or transfer ownership of such shares of 3.90% Series Preferred
Stock on the account books maintained by the DTC, together, in any such
case, with all accompanying evidences of transfer and authenticity, to or
upon the order of the Company;
- present such shares of 3.90% Series Preferred Stock for transfer on the
books of the Company; and
- receive all benefits and otherwise exercise all rights of beneficial
ownership of such shares of 3.90% Series Preferred Stock, all in
accordance with the terms of the Offer.
The undersigned hereby represents and warrants to the Company that:
- the undersigned has full power and authority to tender, sell, assign and
transfer the shares of 3.90% Series Preferred Stock tendered hereby and
that when the same are accepted for payment by the Company, the Company
will acquire good marketable and unencumbered title thereto, free and
clear of all liens, restrictions, charges and encumbrances and not
subject to any adverse claims;
- the undersigned understands that tenders of shares pursuant to any one of
the procedures described in Section 3 of the Offer to Purchase and in the
instructions to this Letter of Transmittal will constitute the
undersigned's acceptance of the terms and conditions of the Offer,
including the undersigned's representation and warranty that (a) the
undersigned has a "net long position," within the meaning of Rule 14e-4
promulgated under the Securities Exchange Act of 1934, as amended, in the
shares or equivalent securities at least equal to the shares being
tendered, and (b) the tender of shares complies with Rule 14e-4;
- the undersigned will, upon request, execute and deliver any additional
documents deemed by the Depositary or the Company to be necessary or
desirable to complete the sale, assignment and transfer of the shares of
3.90% Series Preferred Stock tendered hereby; and
- the undersigned has read, understands and agrees to all of the terms of
the Offer.
The undersigned understands that the valid tenders of the 3.90% Series
Preferred Stock pursuant to any one of the procedures described in Section 3 of
the Offer to Purchase and in the instructions hereto will constitute an
agreement between the undersigned and the Company upon the terms and subject to
the conditions of the Offer. The undersigned acknowledges that under no
circumstances will the Company pay interest on the purchase price, including,
without limitation, by reason of any delay in making payment.
The undersigned recognizes that, under certain circumstances set forth in
the Offer to Purchase, the Company may terminate or amend the Offer or may
postpone the acceptance for payment of, or the payment for, shares of 3.90%
Series
3
Preferred Stock tendered or may not be required to purchase any shares of the
3.90% Series Preferred Stock tendered hereby or may accept for payment fewer
than all of the shares of 3.90% Series Preferred Stock tendered hereby.
Unless otherwise indicated under "Special Payment Instructions" of this
Letter of Transmittal, please issue the check for the purchase price of any
shares of 3.90% Series Preferred Stock purchased, and return any shares of 3.90%
Series Preferred Stock not tendered or not purchased, in the name(s) of the
undersigned and, in the case of shares of 3.90% Series Preferred Stock tendered
by book-entry transfer, by credit to the account at the DTC. Similarly, unless
otherwise indicated under "Special Delivery Instructions" of this Letter of
Transmittal, please mail the check for the purchase price of any shares of 3.90%
Series Preferred Stock purchased and any certificates for shares of 3.90% Series
Preferred Stock not tendered or not purchased (and accompanying documents, as
appropriate) to the undersigned at the address shown below the undersigned's
signature(s). In the event that both "Special Payment Instructions" and "Special
Delivery Instructions" are completed, please issue the check for the purchase
price of any shares of 3.90% Series Preferred Stock purchased and return any
shares of 3.90% Series Preferred Stock not tendered or not purchased in the
name(s) of, and mail said check and any certificates to, the person(s) so
indicated. The undersigned recognizes that the Company has no obligation,
pursuant to the "Special Payment Instructions," to transfer any shares of 3.90%
Series Preferred Stock from the name of the registered holder(s) thereof if the
Company does not accept for payment any shares of the 3.90% Series Preferred
Stock so tendered.
All authority conferred or agreed to be conferred by this Letter of
Transmittal will survive the death or incapacity of the undersigned, and any
obligation of the undersigned will be binding on the heirs, personal
representatives, executors, administrators, successors, assigns, trustees in
bankruptcy and legal representatives of the undersigned. Except as stated in the
Offer to Purchase, this tender is irrevocable.
4
PLEASE SIGN HERE
(TO BE COMPLETED BY ALL TENDERING HOLDERS OF 3.90% SERIES PREFERRED STOCK)
This Letter of Transmittal must be signed by the registered holder(s) of
3.90% Series Preferred Stock exactly as their name(s) appear(s) on
certificate(s) for shares of 3.90% Series Preferred Stock or, if tendered by a
participant in the DTC system, exactly as such participant's name appears on a
security position listing as the owner of shares of 3.90% Series Preferred
Stock, or by person(s) authorized to become registered holders of shares of
3.90% Series Preferred Stock by endorsements on certificates for shares of 3.90%
Series Preferred Stock or by stock powers transmitted with this Letter of
Transmittal. Endorsements on shares of 3.90% Series Preferred Stock and
signatures on stock powers by registered holders of shares of 3.90% Series
Preferred Stock not executing this Letter of Transmittal must be guaranteed by
an Eligible Institution. See Instructions 1 and 2 below. If signature is by a
trustee, executor, administrator, guardian, attorney-in-fact, officers of a
corporation or other person acting in a fiduciary or representative capacity,
such person must set forth his or her full title below under "Capacity" and
submit evidence satisfactory to the Company of such person's authority to so
act. See Instruction 1 below.
- --------------------------------------------------------------------------------
Signature(s) of Owner(s)
- --------------------------------------------------------------------------------
Signature(s) of Owner(s)
Dated:
- ------------------------------------ , 2002
Name(s):
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Please Print)
Capacity (full title):
- --------------------------------------------------------------------------------
Address:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Include Zip Code)
Area Code and Telephone Number:
- --------------------------------------------------------------------------------
PLEASE COMPLETE SUBSTITUTE FORM W-9 HEREIN
GUARANTEE OF SIGNATURE(S)
(IF REQUIRED, SEE INSTRUCTIONS 1 AND 2)
Name of Firm:
- --------------------------------------------------------------------------------
Address and Telephone Number:
- --------------------------------------------------------------------------------
Authorized Signature:
- --------------------------------------------------------------------------------
Printed Name:
- --------------------------------------------------------------------------------
Title:
- --------------------------------------------------------------------------------
Dated:
- ------------------------------------ , 2002
5
------------------------------------------------------------
SPECIAL PAYMENT INSTRUCTIONS
(SEE INSTRUCTIONS 1, 2, 6 AND 7)
To be completed ONLY if the check for the purchase price of shares of
3.90% Series Preferred Stock purchased (less the amount of any federal
income and backup withholding tax required to be withheld) or certificates
for shares of 3.90% Series Preferred Stock not tendered or not purchased
are to be issued in the name of someone other the undersigned.
Mail: [ ] check [ ] certificates to:
Name:
----------------------------------------------------
(PLEASE PRINT)
Address:
--------------------------------------------------
------------------------------------------------------------
(INCLUDING ZIP CODE)
------------------------------------------------------------
(TAXPAYER IDENTIFICATION NO.)
Credit unpurchased shares of 3.90% Series Preferred Stock by book-entry to
the book-entry transfer facility account set forth below:
DTC Account Number:
-----------------------------------------------
Number of Account Party:
-----------------------------------------------
------------------------------------------------------------
------------------------------------------------------------
SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 1, 2 AND 7)
To be completed ONLY if the check for the purchase price of shares of
3.90% Series Preferred Stock purchased (less the amount of any federal
income and backup withholding tax required to be withheld) or certificates
for shares of 3.90% Series Preferred Stock not tendered or not purchased
are to be mailed to someone other than the undersigned or to the
undersigned at an address other than that shown below the undersigned's
signature(s).
Mail: [ ] check [ ] certificates to:
Name:
----------------------------------------------------
(PLEASE PRINT)
Address:
--------------------------------------------------
------------------------------------------------------------
(INCLUDING ZIP CODE)
------------------------------------------------------------
6
NIAGARA MOHAWK
CUMULATIVE PREFERRED STOCK, 3.90% SERIES
COMPLETE ONLY IF APPLICABLE:
SOLICITED TENDERS
As described in the Offer to Purchase, dated February 27, 2002, Niagara
Mohawk will pay, in the amounts and on the terms and conditions set forth in the
Offer to Purchase, Retail Soliciting Dealer Fees (see Instruction 12) to
designated soliciting dealers (as described in the Offer to Purchase).
The above signed represents that the soliciting dealer that solicited and
obtained this tender is:
Name of Firm:
- --------------------------------------------------------------------------------
(PLEASE PRINT)
Name of Individual Broker:
- --------------------------------------------------------------------------------
Telephone Number of Broker:
- --------------------------------------------------------------------------------
Address:
- --------------------------------------------------------------------------------
(INCLUDE ZIP CODE)
If shares specified in this Letter of Transmittal are held by the above
signed as custodian, specify below each beneficial owner of such shares whose
tender you have solicited. Any questions as to what constitutes beneficial
ownership should be directed to the Depositary. If the space below is
inadequate, attach a separate signed schedule using the same format.
<Table>
<Caption>
NAME OF NUMBER OF PREFERRED SHARES
BENEFICIAL OWNER (MUST BE LESS THAN 2,500)
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
</Table>
The acceptance of compensation by such soliciting dealer will constitute a
representation by it that (a) it has complied with the applicable requirements
of the Securities Exchange Act of 1934, as amended, and the applicable rules and
regulations thereunder, in connection with such solicitation; (b) it is entitled
to such compensation for such solicitation under the terms and conditions of the
Offer to Purchase; (c) in soliciting a tender, it has used no solicitation
materials other than those furnished by Niagara Mohawk; and (d) if it is a
foreign broker or dealer not eligible for membership in the National Association
of Securities Dealers, Inc. (the "NASD"), it has agreed to conform to the NASD's
Rules of Fair Practice in making solicitations. See also Instruction 12.
SOLICITATION FEE PAYMENT INSTRUCTIONS
ISSUE CHECK TO:
Firm:
- --------------------------------------------------------------------------------
(PLEASE PRINT)
Attention:
- --------------------------------------------------------------------------------
Address:
- --------------------------------------------------------------------------------
Phone Number:
---------------------
Taxpayer Identification or Social Security Number:
------------------------
7
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER
1. SIGNATURES ON LETTER OF TRANSMITTAL; STOCK POWERS AND ENDORSEMENTS. If
this Letter of Transmittal is signed by the registered holder(s) of the shares
of 3.90% Series Preferred Stock tendered hereby, the signature(s) must
correspond with the name(s) as written on the face of the certificates without
alteration, enlargement or any change whatsoever.
If any of the shares of 3.90% Series Preferred Stock tendered hereby are
held of record by two or more persons, all such persons must sign this Letter of
Transmittal.
If any of the shares of 3.90% Series Preferred Stock tendered hereby are
registered in different names on different certificates, it will be necessary to
complete, sign and submit as many separate Letters of Transmittal as there are
different registrations of certificates.
If this Letter of Transmittal is signed by the registered holder(s) of the
shares of 3.90% Series Preferred Stock tendered hereby, no endorsements of
certificates or separate stock powers are required unless payment of the
purchase price is to be made, or shares of 3.90% Series Preferred Stock not
tendered or not purchased are to be returned, in the name of any person other
than the registered holder(s). Signatures on any such certificates or stock
powers must be guaranteed by an Eligible Institution (as defined in Instruction
2).
If this Letter of Transmittal is signed by a person other than the
registered holder(s) of the shares of 3.90% Series Preferred Stock tendered
hereby, certificates must be endorsed or accompanied by appropriate stock
powers, in either case, signed exactly as the name(s) of the registered
holder(s) appear(s) on the certificates for such shares of 3.90% Series
Preferred Stock. Signature(s) on any such certificates or stock powers must be
guaranteed by an Eligible Institution.
If this Letter of Transmittal or any certificate or stock power is signed
by a trustee, executor, administrator, guardian, attorney-in-fact, officer of a
corporation or other person acting in a fiduciary or representative capacity,
such person should so indicate when signing, and proper evidence satisfactory to
the Company of the authority of such person so to act must be submitted.
2. GUARANTEE OF SIGNATURES. Except as otherwise provided below, all
signatures on this Letter of Transmittal must be guaranteed by a financial
institution (including most banks, savings and loan associations and brokerage
houses) that is a member of a recognized Medallion Program approved by The
Securities Transfer Association, Inc., including the Securities Transfer Agents
Medallion Program (STAMP), the Stock Exchange Medallion Program (SEMP) and the
New York Stock Exchange, Inc. Medallion Signature Program (MSP) or any other
"eligible guarantor institution" (as such term is defined in Rule 17Ad-15 under
the Securities Exchange Act of 1934, as amended) (each an "Eligible
Institution"). Signatures on this Letter of Transmittal need not be guaranteed
(i) if this Letter of Transmittal is signed by the registered holder(s) of the
shares of 3.90% Series Preferred Stock (which term, for purposes of this
document, shall include any participant in the DTC whose name appears on a
security position listing as the owner of shares of 3.90% Series Preferred
Stock) tendered herewith and such holder(s) have not completed the boxes
entitled "Special Payment Instructions" or "Special Delivery Instructions" on
this Letter of Transmittal or (ii) if such shares of 3.90% Series Preferred
Stock is tendered for the account of an Eligible Institution. See Instruction 1
above.
3. DELIVERY OF LETTER OF TRANSMITTAL AND 3.90% SERIES PREFERRED
STOCK. This Letter of Transmittal is to be used either if certificates are to
be forwarded herewith or, unless an Agent's Message is utilized, if delivery of
shares of 3.90% Series Preferred Stock is to be made by book-entry transfer
pursuant to the procedures set forth in Section 3 of the Offer to Purchase.
Certificates for all physically delivered shares of 3.90% Series Preferred
Stock, or a confirmation of a book-entry transfer into the Depositary's account
at DTC of all shares of 3.90% Series Preferred Stock delivered electronically,
as well as a properly completed and duly executed Letter of Transmittal (or in
the case of a book-entry transfer, an Agent's Message) and any other documents
required by this Letter of Transmittal, must be received by the Depositary at
one of its addresses set forth on the front page of this Letter of Transmittal
by the Expiration Date.
The term "Agent's Message" means a message, transmitted by DTC to, and
received by, the depositary and forming a part of a book-entry confirmation
which states that DTC has received an express acknowledgment from the
participant
8
in DTC tendering the preferred shares that are the subject of such book-entry
confirmation agreeing to be bound by the terms of the Letter of Transmittal and
that we may enforce such agreement against such participant.
THE METHOD OF DELIVERY OF SHARES OF 3.90% SERIES PREFERRED STOCK AND ALL
OTHER REQUIRED DOCUMENTS IS AT THE OPTION AND RISK OF THE TENDERING SHAREHOLDER.
IF DELIVERY IS BY MAIL, WE RECOMMEND YOU USE REGISTERED MAIL WITH RETURN RECEIPT
REQUESTED, PROPERLY INSURED. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO
ENSURE TIMELY DELIVERY.
No alternative, conditional or contingent tenders will be accepted, and no
fractional shares of 3.90% Series Preferred Stock will be purchased. By
executing this Letter of Transmittal, the tendering shareholder waives any right
to receive any notice of the acceptance for payment of the shares of 3.90%
Series Preferred Stock.
4. INADEQUATE SPACE. If the space provided herein is inadequate, the
certificate numbers and/or the number of shares of 3.90% Series Preferred Stock
should be listed on a separate schedule attached hereto.
5. PARTIAL TENDERS (NOT APPLICABLE TO SHAREHOLDERS WHO TENDER BY
BOOK-ENTRY TRANSFER). If fewer than all the shares of 3.90% Series Preferred
Stock represented by any certificate delivered to the Depositary are to be
tendered, fill in the number of shares of 3.90% Series Preferred Stock which are
to be tendered in the box entitled "Number of Shares of 3.90% Series Preferred
Stock Tendered." In such case, a new certificate for the remainder of the shares
of 3.90% Series Preferred Stock represented by the old certificate will be sent
to the person(s) signing this Letter of Transmittal, unless otherwise provided
in the appropriate box on this Letter of Transmittal, as promptly as practicable
following the expiration or termination of the Offer. All shares of 3.90% Series
Preferred Stock represented by certificates delivered to the Depositary will be
deemed to have been tendered unless otherwise indicated.
6. STOCK TRANSFER TAXES. The Company will pay any stock transfer taxes
with respect to the sale and transfer of any shares of 3.90% Series Preferred
Stock to it or its order pursuant to the Offer. If, however, payment of the
purchase price is to be made to, or shares of 3.90% Series Preferred Stock not
tendered or not purchased is to be returned in the name of, any person other
than the registered holder(s), or if a transfer tax is imposed for any reason
other than the sale or transfer of shares of 3.90% Series Preferred Stock to the
Company pursuant to the Offer, then the amount of any stock transfer taxes
(whether imposed on the registered holder(s), such other person or otherwise)
will be deducted from the purchase price unless satisfactory evidence of the
payment of such taxes, or exemption therefrom, is submitted herewith.
7. SPECIAL PAYMENT AND DELIVERY INSTRUCTIONS. If the check for the
purchase price of any shares of 3.90% Series Preferred Stock purchased is to be
issued, or any shares of 3.90% Series Preferred Stock not tendered or not
purchased is to be returned, in the name of a person other than the person(s)
signing this Letter of Transmittal or if the check or any certificates for
shares of 3.90% Series Preferred Stock not tendered or not purchased are to be
mailed to someone other than the person(s) signing this Letter of Transmittal or
to the person(s) signing this Letter of Transmittal at an address other than
that shown above, the appropriate boxes on this Letter of Transmittal should be
completed. Shareholders tendering shares of 3.90% Series Preferred Stock by
book-entry transfer may request that shares of 3.90% Series Preferred Stock not
purchased be credited to such account at any of the book-entry transfer
facilities as such shareholder may designate under "Special Payment
Instructions" above. If no such instructions are given, any such shares of 3.90%
Series Preferred Stock not purchased will be returned by crediting the account
at the book-entry transfer facilities at DTC.
8. SUBSTITUTE FORM W-9 AND W-8BEN. Under the federal income tax laws, the
Depositary will be required to withhold 30% of the amount of any payments made
to certain shareholders pursuant to the Offer, as described below. In order to
avoid such backup withholding, each tendering shareholder, and, if applicable,
each other payee, must provide the Depositary with such shareholder's or payee's
correct taxpayer identification number and certify that such shareholder or
payee is not subject to such backup withholding by completing the substitute
Form W-9 included below. In general, if a shareholder or payee is an individual,
the taxpayer identification number is the Social Security number of such
individual. If the Depositary is not provided with the correct taxpayer
identification number, the shareholder or payee may be subject to a $50 penalty
imposed by the Internal Revenue Service. Certain shareholders or payees
(including, among others, all corporations and certain foreign individuals) are
not subject to these backup withholding and reporting requirements. To avoid
possible erroneous backup withholding, a shareholder who is exempt from backup
withholding should complete the substitute Form W-9 by providing his or her
correct TIN, signing and dating the form and writing "exempt" on the face of the
form. Noncorporate foreign shareholders must instead submit to the Depositary a
properly completed Form W-8BEN, Certificate of Foreign Status (which the
Depositary will provide upon request), signed under penalties of perjury,
attesting to such person's exempt status. For further information concerning
backup withholding and instructions
9
for completing the substitute Form W-9 (including how to obtain a taxpayer
identification number if you do not have one and how to complete the substitute
Form W-9 if shares are held in more than one name), consult the enclosed
Guidelines for Certification of Taxpayer Identification Number on substitute
Form W-9.
Failure to complete the substitute Form W-9 or Form W-8BEN will not, by
itself, cause shares of 3.90% Series Preferred Stock to be deemed invalidly
tendered but may require the Depositary to withhold 30% of the amount of any
payments made pursuant to the Offer. Backup withholding is not an additional
federal income tax. Rather, the federal income tax liability of a person subject
to backup withholding will be reduced by the amount of tax withheld. If
withholding results in an overpayment of taxes, a refund may be obtained
provided that the required information is furnished to the Internal Revenue
Service. NOTE: FAILURE TO COMPLETE AND RETURN THE SUBSTITUTE FORM W-9 MAY RESULT
IN BACKUP WITHHOLDING OF 30% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER.
PLEASE REVIEW THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER
IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
9. MUTILATED, LOST, STOLEN OR DESTROYED CERTIFICATES. If a certificate
that represents shares of 3.90% Series Preferred Stock has been mutilated, lost,
stolen or destroyed, the holder should (i) complete this Letter of Transmittal
and check the appropriate box and (ii) contact the Depositary immediately. The
Depositary will provide such holder with all necessary forms and instructions to
replace any mutilated, lost, stolen or destroyed certificates. The holder may
also be required to give the Company a bond as indemnity against any claim that
may be made against it with respect to the certificate(s) alleged to have been
mutilated, lost, stolen or destroyed. This Letter of Transmittal and related
documents cannot be processed until the procedures for replacing mutilated,
lost, stolen or destroyed certificates have been followed.
10. IRREGULARITIES. All questions as to the purchase price, the form of
documents, and the validity, eligibility, including time of receipt, and
acceptance of any tender of shares of 3.90% Series Preferred Stock will be
determined by the Company, in its sole discretion, and its determination shall
be final and binding. The Company reserves the absolute right to reject any or
all tenders of shares of 3.90% Series Preferred Stock that it determines are not
in proper form or the acceptance for payment of or payment for shares of 3.90%
Series Preferred Stock that may, in the opinion of the Company's counsel, be
unlawful. Except as otherwise provided in the Offer to Purchase, the Company
also reserves the absolute right to waive any of the conditions to the Offer or
any defect or irregularity in any tender of shares of 3.90% Series Preferred
Stock, and its interpretation of the terms and conditions of the Offer,
including these instructions, shall be final and binding. Unless waived, any
defects or irregularities in connection with tenders must be cured within such
time as the Company shall determine.
11. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Requests for assistance
may be made to the Information Agent or the Dealer Manager at their respective
addresses or telephone numbers set forth on the back cover of this Letter of
Transmittal. Additional copies of the Offer to Purchase and this Letter of
Transmittal may be obtained from the Information Agent.
12. RETAIL SOLICITING DEALER FEE INSTRUCTIONS. Upon the terms and subject
to the conditions set forth in this Letter of Transmittal and the Offer to
Purchase, in the event that the relevant beneficial owner so designates, the
Company will pay, promptly after the Expiration Date, to persons who were
responsible for soliciting tenders from beneficial owners whose individual
ownership is less than 2,500 shares of 3.90% Series Preferred Stock, a fee (the
"Retail Soliciting Dealer Fee") equal to $1.50 per share of 3.90% Series
Preferred Stock for which instructions to tender have been given due to the
efforts of such soliciting person, provided that the instructions and Letter of
Transmittal relating thereto have been validly delivered. The "Solicited Tenders
Box" should be completed to designate a soliciting dealer. No person may receive
the Retail Soliciting Dealer Fee unless such person is (i) a broker or dealer in
securities, including the dealer manager in its capacity as a dealer or broker,
which is a member of any national securities exchange or of the National
Association of Securities Dealers, Inc. ("NASD"), (ii) a foreign broker or
dealer not eligible for membership in the NASD which agrees to conform to the
NASD's Rules of Fair Practice in soliciting tenders outside the U.S. to the same
extent as though it were an NASD member or (iii) a bank or trust company legally
authorized to receive such fees. Beneficial owners are able to nominate such
retail soliciting dealers in the appropriate section of this Letter of
Transmittal. Participants in DTC will be required to undertake to distribute the
related Retail Soliciting Dealer Fee to such persons as appropriate. Neither the
Company nor the Dealer Manager will be responsible for making such distribution
or for ensuring that DTC participants make such distribution.
10
<Table>
- ---------------------------------------------------------------------------------------------------------------------------
SUBSTITUTE PART 1 -- Taxpayer Identification
FORM W-9 Number -- For all accounts, enter your
DEPARTMENT OF THE TREASURY taxpayer identification number in the
INTERNAL REVENUE SERVICE appropriate box. For most individuals and
sole proprietors, this is your Social --------------------------------------------
Security Number. For other entities, it is Social Security Number
your Employer Identification Number. If you
do not have a number, see "How to Obtain a OR
TIN" in the enclosed Guidelines. Note: If ---------------------------------------
the account is in more than one name, see Employer Identification Number
the chart in the enclosed Guidelines to
determine what number to enter.
------------------------------------------------------------------------------------------
PART II -- Certification -- Under penalties of perjury, I certify that:
(1)(a) The number shown on this form is my correct taxpayer identification number or (b) a
taxpayer identification number has not been issued to me and either (i) I have mailed or
delivered an application to receive a taxpayer identification number to the appropriate
Internal Revenue Service Center or Social Security Administration Office or (ii) I intend
to mail or deliver an application in the near future. I understand that if I do not provide
a taxpayer identification number by the time payment is made to me pursuant to the Offer,
30% of all reportable payments made to me pursuant to the Offer will be withheld;
(2) I am not subject to backup withholding either because (a) I am exempt from backup
withholding, or (b) I have not been notified by the Internal Revenue Service ("IRS") that I
am subject to backup withholding as a result of a failure to report all interest or
PAYER'S REQUEST FOR TAXPAYER dividends, or (c) after being so notified, the IRS had notified me that I am no longer
IDENTIFICATION NUMBER subject to backup withholding;
(3) I am a U.S. person (including a U.S. resident alien); and
(4) Any information provided on this form is true, correct and complete.
- ---------------------------------------------------------------------------------------------------------------------------
CERTIFICATION INSTRUCTIONS -- You must cross out item (2) above if you have been notified by the
IRS that you are subject to backup withholding because of underreporting interest or dividends PART III
on your tax return. However, if after being notified by the IRS that you were subject to backup Awaiting TIN [ ]
withholding you received another notification from the IRS stating that you are no longer
subject to backup withholding, do not cross out item (2). If you are awaiting the issuance of a
taxpayer identification number, check the box in Part III. If you are exempt from backup PART IV
withholding, check the box in Part IV. Exempt from Backup
Withholding [ ]
- ---------------------------------------------------------------------------------------------------------------------------
Signature:
- ---------------------------------------------------------------------------------------------------------------------------
Name: Date:
--------------------------------------------------------------------------------------------------------------------------
Address:
--------------------------------------------------------------------------------------------------------------------------
(Please Print)
</Table>
Check appropriate box: [ ] Individual/Sole proprietor [ ] Corporation
[ ] Partnership [ ] Other
- --------------------------------------------------------------------------------
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP
WITHHOLDING OF 30% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER. PLEASE
REVIEW ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER
ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
- --------------------------------------------------------------------------------
11
Questions regarding how to tender and requests for additional copies of this
document, the Offer to Purchase or other documents related to the Offer should
be directed to the Information Agent.
The Information Agent for the Offer is:
D.F. KING & CO., INC.
77 Water Street
New York, NY 10005
(888) 414-5566 (toll free)
Questions regarding the terms of the offer should be directed to the Dealer
Manager.
The Dealer Manager for the Offer is:
MERRILL LYNCH & CO.
4 World Financial Center, 7th Floor
New York, NY 10080
Attention: Liability Management Group
(888) ML4-TNDR (654-8637)
LETTER OF TRANSMITTAL
OF
NIAGARA MOHAWK POWER CORPORATION
PURSUANT TO THE OFFER TO PURCHASE
DATED FEBRUARY 27, 2002
THIS LETTER OF TRANSMITTAL IS BEING USED WITH RESPECT TO
CUMULATIVE PREFERRED STOCK, 4.10% SERIES
(CUSIP NO. 653522508)
AT A PURCHASE PRICE OF $76.49 PER SHARE
THE OFFER AND YOUR WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY
TIME, ON WEDNESDAY, MARCH 27, 2002, UNLESS EXTENDED OR EARLIER TERMINATED (SUCH
TIME AND DATE, AS THE SAME MAY BE EXTENDED OR TERMINATED, AN "EXPIRATION DATE").
The Depositary for the Offer is:
THE BANK OF NEW YORK
<Table>
By Mail: By Hand: By Overnight Delivery:
The Bank of New York The Bank of New York The Bank of New York
Niagara Mohawk PFD Tender Reorganization Services Niagara Mohawk PFD Tender
PO Box 859208 One Wall Street -- 3rd Floor 165 Bay State Road
Braintree, MA 02185-9208 New York, NY 10286 Braintree, MA 02184
</Table>
By Facsimile:
(781) 380-3388
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET FORTH
ABOVE OR TRANSMISSION OF THIS LETTER OF TRANSMITTAL
VIA A FACSIMILE NUMBER OTHER THAN AS LISTED ABOVE WILL NOT CONSTITUTE A VALID
DELIVERY TO THE DEPOSITARY.
You must sign this Letter of Transmittal in the appropriate space therefor
provided below.
YOU SHOULD READ THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL
CAREFULLY BEFORE YOU COMPLETE THIS LETTER OF TRANSMITTAL.
This Letter of Transmittal is to be used if certificates are to be forwarded
herewith or, unless an Agent's Message (as defined in the Offer to Purchase) is
utilized, if delivery of 4.10% Series Preferred Stock (as defined below) is to
be made by book-entry transfer to the Depositary's account at The Depository
Trust Company ("DTC") pursuant to the procedures set forth in Section 3 of the
Offer to Purchase.
IF YOU HAVE ANY QUESTIONS ABOUT HOW TO FILL OUT THIS LETTER OF TRANSMITTAL
PLEASE CONTACT D.F. KING & CO., THE INFORMATION AGENT, AT (888) 414-5566 (TOLL
FREE).
<Table>
- ------------------------------------------------------------------------------------------------------------------
DESCRIPTION OF 4.10% SERIES PREFERRED STOCK TENDERED
- ------------------------------------------------------------------------------------------------------------------
NAME(S) AND ADDRESS(ES) OF REGISTERED HOLDER(S)
(PLEASE FILL IN, IF BLANK, EXACTLY AS NAME(S) APPEAR(S) ON 4.10% SERIES PREFERRED STOCK TENDERED
SHARE CERTIFICATE(S)) (ATTACH ADDITIONAL LIST IF NECESSARY)
- ------------------------------------------------------------------------------------------------------------------
TOTAL NUMBER
OF SHARES OF NUMBER OF
4.10% SERIES SHARES OF
PREFERRED STOCK 4.10% SERIES
REPRESENTED PREFERRED
CERTIFICATE BY STOCK
NUMBER(S)* CERTIFICATE(S)* TENDERED**
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
TOTAL NUMBER
OF SHARES OF
4.10% SERIES
PREFERRED STOCK
- ------------------------------------------------------------------------------------------------------------------
* Need not be completed by shareholders tendering by book-entry transfer.
** Unless otherwise indicated, it will be assumed that all shares of 4.10% Series Preferred Stock represented by
any certificate delivered to the Depositary are being tendered. See Instruction 5 of this Letter of
Transmittal.
- ------------------------------------------------------------------------------------------------------------------
</Table>
Please check the applicable box below.
<Table>
[ ] I have lost my certificate(s) that represented --------
shares of Cumulative Preferred Stock, 4.10% Series and
require assistance in obtaining replacement certificate(s).
I understand that checking this box does not mean that my
shares have been validly tendered and that I must contact
the Depositary to obtain instructions for replacing lost
certificates. (See Instruction 9 of this Letter of
Transmittal.)
[ ] CHECK HERE IF CERTIFICATES FOR TENDERED 4.10% SERIES
PREFERRED STOCK ARE ENCLOSED HEREWITH.
[ ] CHECK HERE IF TENDERED 4.10% SERIES PREFERRED STOCK IS BEING
DELIVERED BY BOOK-ENTRY TRANSFER TO THE DEPOSITARY'S ACCOUNT
AT THE DTC AND COMPLETE THE FOLLOWING:
</Table>
Name of Tendering Institution
- --------------------------------------------------------------------------------
Account Number
- --------------------------------------------------------------------------------
Transaction Code Number
- --------------------------------------------------------------------------------
2
NOTE: SIGNATURES MUST BE PROVIDED BELOW.
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY.
Ladies and Gentlemen:
The undersigned hereby tenders to Niagara Mohawk Power Corporation (the
"Company"), a New York corporation, the shares in the amount set forth in the
box "Description of 4.10% Series Preferred Stock Tendered" pursuant to the
Company's offer to purchase any and all of its Cumulative Preferred Stock, 4.10%
Series (the "4.10% Series Preferred Stock"), at $76.49 per share, upon the terms
and subject to the conditions set forth in its Offer to Purchase dated February
27, 2002 (the "Offer to Purchase") and in this Letter of Transmittal (which
together constitute the "Offer").
Upon the terms and subject to the conditions of the Offer and effective
upon acceptance for payment of and payment for the 4.10% Series Preferred Stock
tendered herewith, the undersigned hereby sells, assigns and transfers to, or
upon the order of, the Company all right, title and interest in and to all the
shares of 4.10% Series Preferred Stock that are being tendered herewith, or
orders the registration of such shares of 4.10% Series Preferred Stock tendered
by book-entry transfer that are purchased pursuant to the Offer to or upon the
order of the Company, and appoints the Depositary the true and lawful agent and
attorney-in-fact of the undersigned with respect to such shares of 4.10% Series
Preferred Stock, with full power of substitution (such power of attorney being
deemed to be an irrevocable power coupled with an interest), to:
- deliver certificates representing such shares of 4.10% Series Preferred
Stock or transfer ownership of such shares of 4.10% Series Preferred
Stock on the account books maintained by the DTC, together, in any such
case, with all accompanying evidences of transfer and authenticity, to or
upon the order of the Company;
- present such shares of 4.10% Series Preferred Stock for transfer on the
books of the Company; and
- receive all benefits and otherwise exercise all rights of beneficial
ownership of such shares of 4.10% Series Preferred Stock, all in
accordance with the terms of the Offer.
The undersigned hereby represents and warrants to the Company that:
- the undersigned has full power and authority to tender, sell, assign and
transfer the shares of 4.10% Series Preferred Stock tendered hereby and
that when the same are accepted for payment by the Company, the Company
will acquire good marketable and unencumbered title thereto, free and
clear of all liens, restrictions, charges and encumbrances and not
subject to any adverse claims;
- the undersigned understands that tenders of shares pursuant to any one of
the procedures described in Section 3 of the Offer to Purchase and in the
instructions to this Letter of Transmittal will constitute the
undersigned's acceptance of the terms and conditions of the Offer,
including the undersigned's representation and warranty that (a) the
undersigned has a "net long position," within the meaning of Rule 14e-4
promulgated under the Securities Exchange Act of 1934, as amended, in the
shares or equivalent securities at least equal to the shares being
tendered, and (b) the tender of shares complies with Rule 14e-4;
- the undersigned will, upon request, execute and deliver any additional
documents deemed by the Depositary or the Company to be necessary or
desirable to complete the sale, assignment and transfer of the shares of
4.10% Series Preferred Stock tendered hereby; and
- the undersigned has read, understands and agrees to all of the terms of
the Offer.
The undersigned understands that the valid tenders of the 4.10% Series
Preferred Stock pursuant to any one of the procedures described in Section 3 of
the Offer to Purchase and in the instructions hereto will constitute an
agreement between the undersigned and the Company upon the terms and subject to
the conditions of the Offer. The undersigned acknowledges that under no
circumstances will the Company pay interest on the purchase price, including,
without limitation, by reason of any delay in making payment.
The undersigned recognizes that, under certain circumstances set forth in
the Offer to Purchase, the Company may terminate or amend the Offer or may
postpone the acceptance for payment of, or the payment for, shares of 4.10%
Series
3
Preferred Stock tendered or may not be required to purchase any shares of the
4.10% Series Preferred Stock tendered hereby or may accept for payment fewer
than all of the shares of 4.10% Series Preferred Stock tendered hereby.
Unless otherwise indicated under "Special Payment Instructions" of this
Letter of Transmittal, please issue the check for the purchase price of any
shares of 4.10% Series Preferred Stock purchased, and return any shares of 4.10%
Series Preferred Stock not tendered or not purchased, in the name(s) of the
undersigned and, in the case of shares of 4.10% Series Preferred Stock tendered
by book-entry transfer, by credit to the account at the DTC. Similarly, unless
otherwise indicated under "Special Delivery Instructions" of this Letter of
Transmittal, please mail the check for the purchase price of any shares of 4.10%
Series Preferred Stock purchased and any certificates for shares of 4.10% Series
Preferred Stock not tendered or not purchased (and accompanying documents, as
appropriate) to the undersigned at the address shown below the undersigned's
signature(s). In the event that both "Special Payment Instructions" and "Special
Delivery Instructions" are completed, please issue the check for the purchase
price of any shares of 4.10% Series Preferred Stock purchased and return any
shares of 4.10% Series Preferred Stock not tendered or not purchased in the
name(s) of, and mail said check and any certificates to, the person(s) so
indicated. The undersigned recognizes that the Company has no obligation,
pursuant to the "Special Payment Instructions," to transfer any shares of 4.10%
Series Preferred Stock from the name of the registered holder(s) thereof if the
Company does not accept for payment any shares of the 4.10% Series Preferred
Stock so tendered.
All authority conferred or agreed to be conferred by this Letter of
Transmittal will survive the death or incapacity of the undersigned, and any
obligation of the undersigned will be binding on the heirs, personal
representatives, executors, administrators, successors, assigns, trustees in
bankruptcy and legal representatives of the undersigned. Except as stated in the
Offer to Purchase, this tender is irrevocable.
4
PLEASE SIGN HERE
(TO BE COMPLETED BY ALL TENDERING HOLDERS OF 4.10% SERIES PREFERRED STOCK)
This Letter of Transmittal must be signed by the registered holder(s) of
4.10% Series Preferred Stock exactly as their name(s) appear(s) on
certificate(s) for shares of 4.10% Series Preferred Stock or, if tendered by a
participant in the DTC system, exactly as such participant's name appears on a
security position listing as the owner of shares of 4.10% Series Preferred
Stock, or by person(s) authorized to become registered holders of shares of
4.10% Series Preferred Stock by endorsements on certificates for shares of 4.10%
Series Preferred Stock or by stock powers transmitted with this Letter of
Transmittal. Endorsements on shares of 4.10% Series Preferred Stock and
signatures on stock powers by registered holders of shares of 4.10% Series
Preferred Stock not executing this Letter of Transmittal must be guaranteed by
an Eligible Institution. See Instructions 1 and 2 below. If signature is by a
trustee, executor, administrator, guardian, attorney-in-fact, officers of a
corporation or other person acting in a fiduciary or representative capacity,
such person must set forth his or her full title below under "Capacity" and
submit evidence satisfactory to the Company of such person's authority to so
act. See Instruction 1 below.
- --------------------------------------------------------------------------------
Signature(s) of Owner(s)
- --------------------------------------------------------------------------------
Signature(s) of Owner(s)
Dated:
- ------------------------------------ , 2002
Name(s):
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Please Print)
Capacity (full title):
- --------------------------------------------------------------------------------
Address:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Include Zip Code)
Area Code and Telephone Number:
- --------------------------------------------------------------------------------
PLEASE COMPLETE SUBSTITUTE FORM W-9 HEREIN
GUARANTEE OF SIGNATURE(S)
(IF REQUIRED, SEE INSTRUCTIONS 1 AND 2)
Name of Firm:
- --------------------------------------------------------------------------------
Address and Telephone Number:
- --------------------------------------------------------------------------------
Authorized Signature:
- --------------------------------------------------------------------------------
Printed Name:
- --------------------------------------------------------------------------------
Title:
- --------------------------------------------------------------------------------
Dated:
- ------------------------------------ , 2002
5
------------------------------------------------------------
SPECIAL PAYMENT INSTRUCTIONS
(SEE INSTRUCTIONS 1, 2, 6 AND 7)
To be completed ONLY if the check for the purchase price of shares of
4.10% Series Preferred Stock purchased (less the amount of any federal
income and backup withholding tax required to be withheld) or certificates
for shares of 4.10% Series Preferred Stock not tendered or not purchased
are to be issued in the name of someone other the undersigned.
Mail: [ ] check [ ] certificates to:
Name:
----------------------------------------------------
(PLEASE PRINT)
Address:
--------------------------------------------------
------------------------------------------------------------
(INCLUDING ZIP CODE)
------------------------------------------------------------
(TAXPAYER IDENTIFICATION NO.)
Credit unpurchased shares of 4.10% Series Preferred Stock by book-entry to
the book-entry transfer facility account set forth below:
DTC Account Number:
------------------------------------------------
Number of Account Party:
------------------------------------------------
------------------------------------------------------------
------------------------------------------------------------
SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 1, 2 AND 7)
To be completed ONLY if the check for the purchase price of shares of
4.10% Series Preferred Stock purchased (less the amount of any federal
income and backup withholding tax required to be withheld) or certificates
for shares of 4.10% Series Preferred Stock not tendered or not purchased
are to be mailed to someone other than the undersigned or to the
undersigned at an address other than that shown below the undersigned's
signature(s).
Mail: [ ] check [ ] certificates to:
Name:
----------------------------------------------------
(PLEASE PRINT)
Address:
--------------------------------------------------
------------------------------------------------------------
(INCLUDING ZIP CODE)
------------------------------------------------------------
6
NIAGARA MOHAWK
CUMULATIVE PREFERRED STOCK, 4.10% SERIES
COMPLETE ONLY IF APPLICABLE:
SOLICITED TENDERS
As described in the Offer to Purchase, dated February 27, 2002, Niagara
Mohawk will pay, in the amounts and on the terms and conditions set forth in the
Offer to Purchase, Retail Soliciting Dealer Fees (see Instruction 12) to
designated soliciting dealers (as described in the Offer to Purchase).
The above signed represents that the soliciting dealer that solicited and
obtained this tender is:
Name of Firm:
- --------------------------------------------------------------------------------
(PLEASE PRINT)
Name of Individual Broker:
- --------------------------------------------------------------------------------
Telephone Number of Broker:
- --------------------------------------------------------------------------------
Address:
- --------------------------------------------------------------------------------
(INCLUDE ZIP CODE)
If shares specified in this Letter of Transmittal are held by the above
signed as custodian, specify below each beneficial owner of such shares whose
tender you have solicited. Any questions as to what constitutes beneficial
ownership should be directed to the Depositary. If the space below is
inadequate, attach a separate signed schedule using the same format.
<Table>
<Caption>
NAME OF NUMBER OF PREFERRED SHARES
BENEFICIAL OWNER (MUST BE LESS THAN 2,500)
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
</Table>
The acceptance of compensation by such soliciting dealer will constitute a
representation by it that (a) it has complied with the applicable requirements
of the Securities Exchange Act of 1934, as amended, and the applicable rules and
regulations thereunder, in connection with such solicitation; (b) it is entitled
to such compensation for such solicitation under the terms and conditions of the
Offer to Purchase; (c) in soliciting a tender, it has used no solicitation
materials other than those furnished by Niagara Mohawk; and (d) if it is a
foreign broker or dealer not eligible for membership in the National Association
of Securities Dealers, Inc. (the "NASD"), it has agreed to conform to the NASD's
Rules of Fair Practice in making solicitations. See also Instruction 12.
SOLICITATION FEE PAYMENT INSTRUCTIONS
ISSUE CHECK TO:
Firm:
- --------------------------------------------------------------------------------
(PLEASE PRINT)
Attention:
- --------------------------------------------------------------------------------
Address:
- --------------------------------------------------------------------------------
Phone Number:
---------------------
Taxpayer Identification or Social Security Number:
------------------------
7
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER
1. SIGNATURES ON LETTER OF TRANSMITTAL; STOCK POWERS AND ENDORSEMENTS. If
this Letter of Transmittal is signed by the registered holder(s) of the shares
of 4.10% Series Preferred Stock tendered hereby, the signature(s) must
correspond with the name(s) as written on the face of the certificates without
alteration, enlargement or any change whatsoever.
If any of the shares of 4.10% Series Preferred Stock tendered hereby are
held of record by two or more persons, all such persons must sign this Letter of
Transmittal.
If any of the shares of 4.10% Series Preferred Stock tendered hereby are
registered in different names on different certificates, it will be necessary to
complete, sign and submit as many separate Letters of Transmittal as there are
different registrations of certificates.
If this Letter of Transmittal is signed by the registered holder(s) of the
shares of 4.10% Series Preferred Stock tendered hereby, no endorsements of
certificates or separate stock powers are required unless payment of the
purchase price is to be made, or shares of 4.10% Series Preferred Stock not
tendered or not purchased are to be returned, in the name of any person other
than the registered holder(s). Signatures on any such certificates or stock
powers must be guaranteed by an Eligible Institution (as defined in Instruction
2).
If this Letter of Transmittal is signed by a person other than the
registered holder(s) of the shares of 4.10% Series Preferred Stock tendered
hereby, certificates must be endorsed or accompanied by appropriate stock
powers, in either case, signed exactly as the name(s) of the registered
holder(s) appear(s) on the certificates for such shares of 4.10% Series
Preferred Stock. Signature(s) on any such certificates or stock powers must be
guaranteed by an Eligible Institution.
If this Letter of Transmittal or any certificate or stock power is signed
by a trustee, executor, administrator, guardian, attorney-in-fact, officer of a
corporation or other person acting in a fiduciary or representative capacity,
such person should so indicate when signing, and proper evidence satisfactory to
the Company of the authority of such person so to act must be submitted.
2. GUARANTEE OF SIGNATURES. Except as otherwise provided below, all
signatures on this Letter of Transmittal must be guaranteed by a financial
institution (including most banks, savings and loan associations and brokerage
houses) that is a member of a recognized Medallion Program approved by The
Securities Transfer Association, Inc., including the Securities Transfer Agents
Medallion Program (STAMP), the Stock Exchange Medallion Program (SEMP) and the
New York Stock Exchange, Inc. Medallion Signature Program (MSP) or any other
"eligible guarantor institution" (as such term is defined in Rule 17Ad-15 under
the Securities Exchange Act of 1934, as amended) (each an "Eligible
Institution"). Signatures on this Letter of Transmittal need not be guaranteed
(i) if this Letter of Transmittal is signed by the registered holder(s) of the
shares of 4.10% Series Preferred Stock (which term, for purposes of this
document, shall include any participant in the DTC whose name appears on a
security position listing as the owner of shares of 4.10% Series Preferred
Stock) tendered herewith and such holder(s) have not completed the boxes
entitled "Special Payment Instructions" or "Special Delivery Instructions" on
this Letter of Transmittal or (ii) if such shares of 4.10% Series Preferred
Stock is tendered for the account of an Eligible Institution. See Instruction 1
above.
3. DELIVERY OF LETTER OF TRANSMITTAL AND 4.10% SERIES PREFERRED
STOCK. This Letter of Transmittal is to be used either if certificates are to
be forwarded herewith or, unless an Agent's Message is utilized, if delivery of
shares of 4.10% Series Preferred Stock is to be made by book-entry transfer
pursuant to the procedures set forth in Section 3 of the Offer to Purchase.
Certificates for all physically delivered shares of 4.10% Series Preferred
Stock, or a confirmation of a book-entry transfer into the Depositary's account
at DTC of all shares of 4.10% Series Preferred Stock delivered electronically,
as well as a properly completed and duly executed Letter of Transmittal (or in
the case of a book-entry transfer, an Agent's Message) and any other documents
required by this Letter of Transmittal, must be received by the Depositary at
one of its addresses set forth on the front page of this Letter of Transmittal
by the Expiration Date.
The term "Agent's Message" means a message, transmitted by DTC to, and
received by, the depositary and forming a part of a book-entry confirmation
which states that DTC has received an express acknowledgment from the
participant
8
in DTC tendering the preferred shares that are the subject of such book-entry
confirmation agreeing to be bound by the terms of the Letter of Transmittal and
that we may enforce such agreement against such participant.
THE METHOD OF DELIVERY OF SHARES OF 4.10% SERIES PREFERRED STOCK AND ALL
OTHER REQUIRED DOCUMENTS IS AT THE OPTION AND RISK OF THE TENDERING SHAREHOLDER.
IF DELIVERY IS BY MAIL, WE RECOMMEND YOU USE REGISTERED MAIL WITH RETURN RECEIPT
REQUESTED, PROPERLY INSURED. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO
ENSURE TIMELY DELIVERY.
No alternative, conditional or contingent tenders will be accepted, and no
fractional shares of 4.10% Series Preferred Stock will be purchased. By
executing this Letter of Transmittal, the tendering shareholder waives any right
to receive any notice of the acceptance for payment of the shares of 4.10%
Series Preferred Stock.
4. INADEQUATE SPACE. If the space provided herein is inadequate, the
certificate numbers and/or the number of shares of 4.10% Series Preferred Stock
should be listed on a separate schedule attached hereto.
5. PARTIAL TENDERS (NOT APPLICABLE TO SHAREHOLDERS WHO TENDER BY
BOOK-ENTRY TRANSFER). If fewer than all the shares of 4.10% Series Preferred
Stock represented by any certificate delivered to the Depositary are to be
tendered, fill in the number of shares of 4.10% Series Preferred Stock which are
to be tendered in the box entitled "Number of Shares of 4.10% Series Preferred
Stock Tendered." In such case, a new certificate for the remainder of the shares
of 4.10% Series Preferred Stock represented by the old certificate will be sent
to the person(s) signing this Letter of Transmittal, unless otherwise provided
in the appropriate box on this Letter of Transmittal, as promptly as practicable
following the expiration or termination of the Offer. All shares of 4.10% Series
Preferred Stock represented by certificates delivered to the Depositary will be
deemed to have been tendered unless otherwise indicated.
6. STOCK TRANSFER TAXES. The Company will pay any stock transfer taxes
with respect to the sale and transfer of any shares of 4.10% Series Preferred
Stock to it or its order pursuant to the Offer. If, however, payment of the
purchase price is to be made to, or shares of 4.10% Series Preferred Stock not
tendered or not purchased is to be returned in the name of, any person other
than the registered holder(s), or if a transfer tax is imposed for any reason
other than the sale or transfer of shares of 4.10% Series Preferred Stock to the
Company pursuant to the Offer, then the amount of any stock transfer taxes
(whether imposed on the registered holder(s), such other person or otherwise)
will be deducted from the purchase price unless satisfactory evidence of the
payment of such taxes, or exemption therefrom, is submitted herewith.
7. SPECIAL PAYMENT AND DELIVERY INSTRUCTIONS. If the check for the
purchase price of any shares of 4.10% Series Preferred Stock purchased is to be
issued, or any shares of 4.10% Series Preferred Stock not tendered or not
purchased is to be returned, in the name of a person other than the person(s)
signing this Letter of Transmittal or if the check or any certificates for
shares of 4.10% Series Preferred Stock not tendered or not purchased are to be
mailed to someone other than the person(s) signing this Letter of Transmittal or
to the person(s) signing this Letter of Transmittal at an address other than
that shown above, the appropriate boxes on this Letter of Transmittal should be
completed. Shareholders tendering shares of 4.10% Series Preferred Stock by
book-entry transfer may request that shares of 4.10% Series Preferred Stock not
purchased be credited to such account at any of the book-entry transfer
facilities as such shareholder may designate under "Special Payment
Instructions" above. If no such instructions are given, any such shares of 4.10%
Series Preferred Stock not purchased will be returned by crediting the account
at the book-entry transfer facilities at DTC.
8. SUBSTITUTE FORM W-9 AND W-8BEN. Under the federal income tax laws, the
Depositary will be required to withhold 30% of the amount of any payments made
to certain shareholders pursuant to the Offer, as described below. In order to
avoid such backup withholding, each tendering shareholder, and, if applicable,
each other payee, must provide the Depositary with such shareholder's or payee's
correct taxpayer identification number and certify that such shareholder or
payee is not subject to such backup withholding by completing the substitute
Form W-9 included below. In general, if a shareholder or payee is an individual,
the taxpayer identification number is the Social Security number of such
individual. If the Depositary is not provided with the correct taxpayer
identification number, the shareholder or payee may be subject to a $50 penalty
imposed by the Internal Revenue Service. Certain shareholders or payees
(including, among others, all corporations and certain foreign individuals) are
not subject to these backup withholding and reporting requirements. To avoid
possible erroneous backup withholding, a shareholder who is exempt from backup
withholding should complete the substitute Form W-9 by providing his or her
correct TIN, signing and dating the form and writing "exempt" on the face of the
form. Noncorporate foreign shareholders must instead submit to the Depositary a
properly completed Form W-8BEN, Certificate of Foreign Status (which the
Depositary will provide upon request), signed under penalties of perjury,
attesting to such person's exempt status. For further information concerning
backup withholding and instructions
9
for completing the substitute Form W-9 (including how to obtain a taxpayer
identification number if you do not have one and how to complete the substitute
Form W-9 if shares are held in more than one name), consult the enclosed
Guidelines for Certification of Taxpayer Identification Number on substitute
Form W-9.
Failure to complete the substitute Form W-9 or Form W-8BEN will not, by
itself, cause shares of 4.10% Series Preferred Stock to be deemed invalidly
tendered but may require the Depositary to withhold 30% of the amount of any
payments made pursuant to the Offer. Backup withholding is not an additional
federal income tax. Rather, the federal income tax liability of a person subject
to backup withholding will be reduced by the amount of tax withheld. If
withholding results in an overpayment of taxes, a refund may be obtained
provided that the required information is furnished to the Internal Revenue
Service. NOTE: FAILURE TO COMPLETE AND RETURN THE SUBSTITUTE FORM W-9 MAY RESULT
IN BACKUP WITHHOLDING OF 30% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER.
PLEASE REVIEW THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER
IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
9. MUTILATED, LOST, STOLEN OR DESTROYED CERTIFICATES. If a certificate
that represents shares of 4.10% Series Preferred Stock has been mutilated, lost,
stolen or destroyed, the holder should (i) complete this Letter of Transmittal
and check the appropriate box and (ii) contact the Depositary immediately. The
Depositary will provide such holder with all necessary forms and instructions to
replace any mutilated, lost, stolen or destroyed certificates. The holder may
also be required to give the Company a bond as indemnity against any claim that
may be made against it with respect to the certificate(s) alleged to have been
mutilated, lost, stolen or destroyed. This Letter of Transmittal and related
documents cannot be processed until the procedures for replacing mutilated,
lost, stolen or destroyed certificates have been followed.
10. IRREGULARITIES. All questions as to the purchase price, the form of
documents, and the validity, eligibility, including time of receipt, and
acceptance of any tender of shares of 4.10% Series Preferred Stock will be
determined by the Company, in its sole discretion, and its determination shall
be final and binding. The Company reserves the absolute right to reject any or
all tenders of shares of 4.10% Series Preferred Stock that it determines are not
in proper form or the acceptance for payment of or payment for shares of 4.10%
Series Preferred Stock that may, in the opinion of the Company's counsel, be
unlawful. Except as otherwise provided in the Offer to Purchase, the Company
also reserves the absolute right to waive any of the conditions to the Offer or
any defect or irregularity in any tender of shares of 4.10% Series Preferred
Stock, and its interpretation of the terms and conditions of the Offer,
including these instructions, shall be final and binding. Unless waived, any
defects or irregularities in connection with tenders must be cured within such
time as the Company shall determine.
11. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Requests for assistance
may be made to the Information Agent or the Dealer Manager at their respective
addresses or telephone numbers set forth on the back cover of this Letter of
Transmittal. Additional copies of the Offer to Purchase and this Letter of
Transmittal may be obtained from the Information Agent.
12. RETAIL SOLICITING DEALER FEE INSTRUCTIONS. Upon the terms and subject
to the conditions set forth in this Letter of Transmittal and the Offer to
Purchase, in the event that the relevant beneficial owner so designates, the
Company will pay, promptly after the Expiration Date, to persons who were
responsible for soliciting tenders from beneficial owners whose individual
ownership is less than 2,500 shares of 4.10% Series Preferred Stock, a fee (the
"Retail Soliciting Dealer Fee") equal to $1.50 per share of 4.10% Series
Preferred Stock for which instructions to tender have been given due to the
efforts of such soliciting person, provided that the instructions and Letter of
Transmittal relating thereto have been validly delivered. The "Solicited Tenders
Box" should be completed to designate a soliciting dealer. No person may receive
the Retail Soliciting Dealer Fee unless such person is (i) a broker or dealer in
securities, including the dealer manager in its capacity as a dealer or broker,
which is a member of any national securities exchange or of the National
Association of Securities Dealers, Inc. ("NASD"), (ii) a foreign broker or
dealer not eligible for membership in the NASD which agrees to conform to the
NASD's Rules of Fair Practice in soliciting tenders outside the U.S. to the same
extent as though it were an NASD member or (iii) a bank or trust company legally
authorized to receive such fees. Beneficial owners are able to nominate such
retail soliciting dealers in the appropriate section of this Letter of
Transmittal. Participants in DTC will be required to undertake to distribute the
related Retail Soliciting Dealer Fee to such persons as appropriate. Neither the
Company nor the Dealer Manager will be responsible for making such distribution
or for ensuring that DTC participants make such distribution.
10
<Table>
- ---------------------------------------------------------------------------------------------------------------------------
SUBSTITUTE PART 1 -- Taxpayer Identification
FORM W-9 Number -- For all accounts, enter your
DEPARTMENT OF THE TREASURY taxpayer identification number in the
INTERNAL REVENUE SERVICE appropriate box. For most individuals and
sole proprietors, this is your Social --------------------------------------------
Security Number. For other entities, it is Social Security Number
your Employer Identification Number. If you
do not have a number, see "How to Obtain a OR
TIN" in the enclosed Guidelines. Note: If ---------------------------------------
the account is in more than one name, see Employer Identification Number
the chart in the enclosed Guidelines to
determine what number to enter.
------------------------------------------------------------------------------------------
PART II -- Certification -- Under penalties of perjury, I certify that:
(1)(a) The number shown on this form is my correct taxpayer identification number or (b) a
taxpayer identification number has not been issued to me and either (i) I have mailed or
delivered an application to receive a taxpayer identification number to the appropriate
Internal Revenue Service Center or Social Security Administration Office or (ii) I intend
to mail or deliver an application in the near future. I understand that if I do not provide
a taxpayer identification number by the time payment is made to me pursuant to the Offer,
30% of all reportable payments made to me pursuant to the Offer will be withheld;
(2) I am not subject to backup withholding either because (a) I am exempt from backup
withholding, or (b) I have not been notified by the Internal Revenue Service ("IRS") that I
am subject to backup withholding as a result of a failure to report all interest or
PAYER'S REQUEST FOR TAXPAYER dividends, or (c) after being so notified, the IRS had notified me that I am no longer
IDENTIFICATION NUMBER subject to backup withholding;
(3) I am a U.S. person (including a U.S. resident alien); and
(4) Any information provided on this form is true, correct and complete.
- ---------------------------------------------------------------------------------------------------------------------------
CERTIFICATION INSTRUCTIONS -- You must cross out item (2) above if you have been notified by the
IRS that you are subject to backup withholding because of underreporting interest or dividends PART III
on your tax return. However, if after being notified by the IRS that you were subject to backup Awaiting TIN [ ]
withholding you received another notification from the IRS stating that you are no longer
subject to backup withholding, do not cross out item (2). If you are awaiting the issuance of a
taxpayer identification number, check the box in Part III. If you are exempt from backup PART IV
withholding, check the box in Part IV. Exempt from Backup
Withholding [ ]
- ---------------------------------------------------------------------------------------------------------------------------
Signature:
- ---------------------------------------------------------------------------------------------------------------------------
Name: Date:
--------------------------------------------------------------------------------------------------------------------------
Address:
--------------------------------------------------------------------------------------------------------------------------
(Please Print)
</Table>
Check appropriate box: [ ] Individual/Sole proprietor [ ] Corporation
[ ] Partnership [ ] Other
- --------------------------------------------------------------------------------
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP
WITHHOLDING OF 30% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER. PLEASE
REVIEW ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER
ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
- --------------------------------------------------------------------------------
11
Questions regarding how to tender and requests for additional copies of this
document, the Offer to Purchase or other documents related to the Offer should
be directed to the Information Agent.
The Information Agent for the Offer is:
D.F. KING & CO., INC.
77 Water Street
New York, NY 10005
(888) 414-5566 (toll free)
Questions regarding the terms of the offer should be directed to the Dealer
Manager.
The Dealer Manager for the Offer is:
MERRILL LYNCH & CO.
4 World Financial Center, 7th Floor
New York, NY 10080
Attention: Liability Management Group
(888) ML4-TNDR (654-8637)
LETTER OF TRANSMITTAL
OF
NIAGARA MOHAWK POWER CORPORATION
PURSUANT TO THE OFFER TO PURCHASE
DATED FEBRUARY 27, 2002
THIS LETTER OF TRANSMITTAL IS BEING USED WITH RESPECT TO
CUMULATIVE PREFERRED STOCK, 4.85% SERIES
(CUSIP NO. 653522607)
AT A PURCHASE PRICE OF $90.49 PER SHARE
THE OFFER AND YOUR WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY
TIME, ON WEDNESDAY, MARCH 27, 2002, UNLESS EXTENDED OR EARLIER TERMINATED (SUCH
TIME AND DATE, AS THE SAME MAY BE EXTENDED OR TERMINATED, AN "EXPIRATION DATE").
The Depositary for the Offer is:
THE BANK OF NEW YORK
<Table>
By Mail: By Hand: By Overnight Delivery:
The Bank of New York The Bank of New York The Bank of New York
Niagara Mohawk PFD Tender Reorganization Services Niagara Mohawk PFD Tender
PO Box 859208 One Wall Street -- 3rd Floor 165 Bay State Road
Braintree, MA 02185-9208 New York, NY 10286 Braintree, MA 02184
</Table>
By Facsimile:
(781) 380-3388
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET FORTH
ABOVE OR TRANSMISSION OF THIS LETTER OF TRANSMITTAL
VIA A FACSIMILE NUMBER OTHER THAN AS LISTED ABOVE WILL NOT CONSTITUTE A VALID
DELIVERY TO THE DEPOSITARY.
You must sign this Letter of Transmittal in the appropriate space therefor
provided below.
YOU SHOULD READ THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL
CAREFULLY BEFORE YOU COMPLETE THIS LETTER OF TRANSMITTAL.
This Letter of Transmittal is to be used if certificates are to be forwarded
herewith or, unless an Agent's Message (as defined in the Offer to Purchase) is
utilized, if delivery of 4.85% Series Preferred Stock (as defined below) is to
be made by book-entry transfer to the Depositary's account at The Depository
Trust Company ("DTC") pursuant to the procedures set forth in Section 3 of the
Offer to Purchase.
IF YOU HAVE ANY QUESTIONS ABOUT HOW TO FILL OUT THIS LETTER OF TRANSMITTAL
PLEASE CONTACT D.F. KING & CO., THE INFORMATION AGENT, AT (888) 414-5566 (TOLL
FREE).
<Table>
- ------------------------------------------------------------------------------------------------------------------
DESCRIPTION OF 4.85% SERIES PREFERRED STOCK TENDERED
- ------------------------------------------------------------------------------------------------------------------
NAME(S) AND ADDRESS(ES) OF REGISTERED HOLDER(S)
(PLEASE FILL IN, IF BLANK, EXACTLY AS NAME(S) APPEAR(S) ON 4.85% SERIES PREFERRED STOCK TENDERED
SHARE CERTIFICATE(S)) (ATTACH ADDITIONAL LIST IF NECESSARY)
- ------------------------------------------------------------------------------------------------------------------
TOTAL NUMBER
OF SHARES OF NUMBER OF
4.85% SERIES SHARES OF
PREFERRED STOCK 4.85% SERIES
REPRESENTED PREFERRED
CERTIFICATE BY STOCK
NUMBER(S)* CERTIFICATE(S)* TENDERED**
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
TOTAL NUMBER
OF SHARES OF
4.85% SERIES
PREFERRED STOCK
- ------------------------------------------------------------------------------------------------------------------
* Need not be completed by shareholders tendering by book-entry transfer.
** Unless otherwise indicated, it will be assumed that all shares of 4.85% Series Preferred Stock represented by
any certificate delivered to the Depositary are being tendered. See Instruction 5 of this Letter of
Transmittal.
- ------------------------------------------------------------------------------------------------------------------
</Table>
Please check the applicable box below.
<Table>
[ ] I have lost my certificate(s) that represented --------
shares of Cumulative Preferred Stock, 4.85% Series and
require assistance in obtaining replacement certificate(s).
I understand that checking this box does not mean that my
shares have been validly tendered and that I must contact
the Depositary to obtain instructions for replacing lost
certificates. (See Instruction 9 of this Letter of
Transmittal.)
[ ] CHECK HERE IF CERTIFICATES FOR TENDERED 4.85% SERIES
PREFERRED STOCK ARE ENCLOSED HEREWITH.
[ ] CHECK HERE IF TENDERED 4.85% SERIES PREFERRED STOCK IS BEING
DELIVERED BY BOOK-ENTRY TRANSFER TO THE DEPOSITARY'S ACCOUNT
AT THE DTC AND COMPLETE THE FOLLOWING:
</Table>
Name of Tendering Institution
- --------------------------------------------------------------------------------
Account Number
- --------------------------------------------------------------------------------
Transaction Code Number
- --------------------------------------------------------------------------------
2
NOTE: SIGNATURES MUST BE PROVIDED BELOW.
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY.
Ladies and Gentlemen:
The undersigned hereby tenders to Niagara Mohawk Power Corporation (the
"Company"), a New York corporation, the shares in the amount set forth in the
box "Description of 4.85% Series Preferred Stock Tendered" pursuant to the
Company's offer to purchase any and all of its Cumulative Preferred Stock, 4.85%
Series (the "4.85% Series Preferred Stock"), at $90.49 per share, upon the terms
and subject to the conditions set forth in its Offer to Purchase dated February
27, 2002 (the "Offer to Purchase") and in this Letter of Transmittal (which
together constitute the "Offer").
Upon the terms and subject to the conditions of the Offer and effective
upon acceptance for payment of and payment for the 4.85% Series Preferred Stock
tendered herewith, the undersigned hereby sells, assigns and transfers to, or
upon the order of, the Company all right, title and interest in and to all the
shares of 4.85% Series Preferred Stock that are being tendered herewith, or
orders the registration of such shares of 4.85% Series Preferred Stock tendered
by book-entry transfer that are purchased pursuant to the Offer to or upon the
order of the Company, and appoints the Depositary the true and lawful agent and
attorney-in-fact of the undersigned with respect to such shares of 4.85% Series
Preferred Stock, with full power of substitution (such power of attorney being
deemed to be an irrevocable power coupled with an interest), to:
- deliver certificates representing such shares of 4.85% Series Preferred
Stock or transfer ownership of such shares of 4.85% Series Preferred
Stock on the account books maintained by the DTC, together, in any such
case, with all accompanying evidences of transfer and authenticity, to or
upon the order of the Company;
- present such shares of 4.85% Series Preferred Stock for transfer on the
books of the Company; and
- receive all benefits and otherwise exercise all rights of beneficial
ownership of such shares of 4.85% Series Preferred Stock, all in
accordance with the terms of the Offer.
The undersigned hereby represents and warrants to the Company that:
- the undersigned has full power and authority to tender, sell, assign and
transfer the shares of 4.85% Series Preferred Stock tendered hereby and
that when the same are accepted for payment by the Company, the Company
will acquire good marketable and unencumbered title thereto, free and
clear of all liens, restrictions, charges and encumbrances and not
subject to any adverse claims;
- the undersigned understands that tenders of shares pursuant to any one of
the procedures described in Section 3 of the Offer to Purchase and in the
instructions to this Letter of Transmittal will constitute the
undersigned's acceptance of the terms and conditions of the Offer,
including the undersigned's representation and warranty that (a) the
undersigned has a "net long position," within the meaning of Rule 14e-4
promulgated under the Securities Exchange Act of 1934, as amended, in the
shares or equivalent securities at least equal to the shares being
tendered, and (b) the tender of shares complies with Rule 14e-4;
- the undersigned will, upon request, execute and deliver any additional
documents deemed by the Depositary or the Company to be necessary or
desirable to complete the sale, assignment and transfer of the shares of
4.85% Series Preferred Stock tendered hereby; and
- the undersigned has read, understands and agrees to all of the terms of
the Offer.
The undersigned understands that the valid tenders of the 4.85% Series
Preferred Stock pursuant to any one of the procedures described in Section 3 of
the Offer to Purchase and in the instructions hereto will constitute an
agreement between the undersigned and the Company upon the terms and subject to
the conditions of the Offer. The undersigned acknowledges that under no
circumstances will the Company pay interest on the purchase price, including,
without limitation, by reason of any delay in making payment.
The undersigned recognizes that, under certain circumstances set forth in
the Offer to Purchase, the Company may terminate or amend the Offer or may
postpone the acceptance for payment of, or the payment for, shares of 4.85%
Series
3
Preferred Stock tendered or may not be required to purchase any shares of the
4.85% Series Preferred Stock tendered hereby or may accept for payment fewer
than all of the shares of 4.85% Series Preferred Stock tendered hereby.
Unless otherwise indicated under "Special Payment Instructions" of this
Letter of Transmittal, please issue the check for the purchase price of any
shares of 4.85% Series Preferred Stock purchased, and return any shares of 4.85%
Series Preferred Stock not tendered or not purchased, in the name(s) of the
undersigned and, in the case of shares of 4.85% Series Preferred Stock tendered
by book-entry transfer, by credit to the account at the DTC. Similarly, unless
otherwise indicated under "Special Delivery Instructions" of this Letter of
Transmittal, please mail the check for the purchase price of any shares of 4.85%
Series Preferred Stock purchased and any certificates for shares of 4.85% Series
Preferred Stock not tendered or not purchased (and accompanying documents, as
appropriate) to the undersigned at the address shown below the undersigned's
signature(s). In the event that both "Special Payment Instructions" and "Special
Delivery Instructions" are completed, please issue the check for the purchase
price of any shares of 4.85% Series Preferred Stock purchased and return any
shares of 4.85% Series Preferred Stock not tendered or not purchased in the
name(s) of, and mail said check and any certificates to, the person(s) so
indicated. The undersigned recognizes that the Company has no obligation,
pursuant to the "Special Payment Instructions," to transfer any shares of 4.85%
Series Preferred Stock from the name of the registered holder(s) thereof if the
Company does not accept for payment any shares of the 4.85% Series Preferred
Stock so tendered.
All authority conferred or agreed to be conferred by this Letter of
Transmittal will survive the death or incapacity of the undersigned, and any
obligation of the undersigned will be binding on the heirs, personal
representatives, executors, administrators, successors, assigns, trustees in
bankruptcy and legal representatives of the undersigned. Except as stated in the
Offer to Purchase, this tender is irrevocable.
4
PLEASE SIGN HERE
(TO BE COMPLETED BY ALL TENDERING HOLDERS OF 4.85% SERIES PREFERRED STOCK)
This Letter of Transmittal must be signed by the registered holder(s) of
4.85% Series Preferred Stock exactly as their name(s) appear(s) on
certificate(s) for shares of 4.85% Series Preferred Stock or, if tendered by a
participant in the DTC system, exactly as such participant's name appears on a
security position listing as the owner of shares of 4.85% Series Preferred
Stock, or by person(s) authorized to become registered holders of shares of
4.85% Series Preferred Stock by endorsements on certificates for shares of 4.85%
Series Preferred Stock or by stock powers transmitted with this Letter of
Transmittal. Endorsements on shares of 4.85% Series Preferred Stock and
signatures on stock powers by registered holders of shares of 4.85% Series
Preferred Stock not executing this Letter of Transmittal must be guaranteed by
an Eligible Institution. See Instructions 1 and 2 below. If signature is by a
trustee, executor, administrator, guardian, attorney-in-fact, officers of a
corporation or other person acting in a fiduciary or representative capacity,
such person must set forth his or her full title below under "Capacity" and
submit evidence satisfactory to the Company of such person's authority to so
act. See Instruction 1 below.
- --------------------------------------------------------------------------------
Signature(s) of Owner(s)
- --------------------------------------------------------------------------------
Signature(s) of Owner(s)
Dated:
- ------------------------------------ , 2002
Name(s):
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Please Print)
Capacity (full title):
- --------------------------------------------------------------------------------
Address:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Include Zip Code)
Area Code and Telephone Number:
- --------------------------------------------------------------------------------
PLEASE COMPLETE SUBSTITUTE FORM W-9 HEREIN
GUARANTEE OF SIGNATURE(S)
(IF REQUIRED, SEE INSTRUCTIONS 1 AND 2)
Name of Firm:
- --------------------------------------------------------------------------------
Address and Telephone Number:
- --------------------------------------------------------------------------------
Authorized Signature:
- --------------------------------------------------------------------------------
Printed Name:
- --------------------------------------------------------------------------------
Title:
- --------------------------------------------------------------------------------
Dated:
- ------------------------------------ , 2002
5
------------------------------------------------------------
SPECIAL PAYMENT INSTRUCTIONS
(SEE INSTRUCTIONS 1, 2, 6 AND 7)
To be completed ONLY if the check for the purchase price of shares of
4.85% Series Preferred Stock purchased (less the amount of any federal
income and backup withholding tax required to be withheld) or certificates
for shares of 4.85% Series Preferred Stock not tendered or not purchased
are to be issued in the name of someone other the undersigned.
Mail: [ ] check [ ] certificates to:
Name:
----------------------------------------------------
(PLEASE PRINT)
Address:
--------------------------------------------------
------------------------------------------------------------
(INCLUDING ZIP CODE)
------------------------------------------------------------
(TAXPAYER IDENTIFICATION NO.)
Credit unpurchased shares of 4.85% Series Preferred Stock by book-entry to
the book-entry transfer facility account set forth below:
DTC Account Number:
------------------------------------------------
Number of Account Party:
------------------------------------------------
------------------------------------------------------------
------------------------------------------------------------
SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 1, 2 AND 7)
To be completed ONLY if the check for the purchase price of shares of
4.85% Series Preferred Stock purchased (less the amount of any federal
income and backup withholding tax required to be withheld) or certificates
for shares of 4.85% Series Preferred Stock not tendered or not purchased
are to be mailed to someone other than the undersigned or to the
undersigned at an address other than that shown below the undersigned's
signature(s).
Mail: [ ] check [ ] certificates to:
Name:
----------------------------------------------------
(PLEASE PRINT)
Address:
--------------------------------------------------
------------------------------------------------------------
(INCLUDING ZIP CODE)
------------------------------------------------------------
6
NIAGARA MOHAWK
CUMULATIVE PREFERRED STOCK, 4.85% SERIES
COMPLETE ONLY IF APPLICABLE:
SOLICITED TENDERS
As described in the Offer to Purchase, dated February 27, 2002, Niagara
Mohawk will pay, in the amounts and on the terms and conditions set forth in the
Offer to Purchase, Retail Soliciting Dealer Fees (see Instruction 12) to
designated soliciting dealers (as described in the Offer to Purchase).
The above signed represents that the soliciting dealer that solicited and
obtained this tender is:
Name of Firm:
- --------------------------------------------------------------------------------
(PLEASE PRINT)
Name of Individual Broker:
- --------------------------------------------------------------------------------
Telephone Number of Broker:
- --------------------------------------------------------------------------------
Address:
- --------------------------------------------------------------------------------
(INCLUDE ZIP CODE)
If shares specified in this Letter of Transmittal are held by the above
signed as custodian, specify below each beneficial owner of such shares whose
tender you have solicited. Any questions as to what constitutes beneficial
ownership should be directed to the Depositary. If the space below is
inadequate, attach a separate signed schedule using the same format.
<Table>
<Caption>
NAME OF NUMBER OF PREFERRED SHARES
BENEFICIAL OWNER (MUST BE LESS THAN 2,500)
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
</Table>
The acceptance of compensation by such soliciting dealer will constitute a
representation by it that (a) it has complied with the applicable requirements
of the Securities Exchange Act of 1934, as amended, and the applicable rules and
regulations thereunder, in connection with such solicitation; (b) it is entitled
to such compensation for such solicitation under the terms and conditions of the
Offer to Purchase; (c) in soliciting a tender, it has used no solicitation
materials other than those furnished by Niagara Mohawk; and (d) if it is a
foreign broker or dealer not eligible for membership in the National Association
of Securities Dealers, Inc. (the "NASD"), it has agreed to conform to the NASD's
Rules of Fair Practice in making solicitations. See also Instruction 12.
SOLICITATION FEE PAYMENT INSTRUCTIONS
ISSUE CHECK TO:
Firm:
- --------------------------------------------------------------------------------
(PLEASE PRINT)
Attention:
- --------------------------------------------------------------------------------
Address:
- --------------------------------------------------------------------------------
Phone Number:
---------------------
Taxpayer Identification or Social Security Number:
------------------------
7
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER
1. SIGNATURES ON LETTER OF TRANSMITTAL; STOCK POWERS AND ENDORSEMENTS. If
this Letter of Transmittal is signed by the registered holder(s) of the shares
of 4.85% Series Preferred Stock tendered hereby, the signature(s) must
correspond with the name(s) as written on the face of the certificates without
alteration, enlargement or any change whatsoever.
If any of the shares of 4.85% Series Preferred Stock tendered hereby are
held of record by two or more persons, all such persons must sign this Letter of
Transmittal.
If any of the shares of 4.85% Series Preferred Stock tendered hereby are
registered in different names on different certificates, it will be necessary to
complete, sign and submit as many separate Letters of Transmittal as there are
different registrations of certificates.
If this Letter of Transmittal is signed by the registered holder(s) of the
shares of 4.85% Series Preferred Stock tendered hereby, no endorsements of
certificates or separate stock powers are required unless payment of the
purchase price is to be made, or shares of 4.85% Series Preferred Stock not
tendered or not purchased are to be returned, in the name of any person other
than the registered holder(s). Signatures on any such certificates or stock
powers must be guaranteed by an Eligible Institution (as defined in Instruction
2).
If this Letter of Transmittal is signed by a person other than the
registered holder(s) of the shares of 4.85% Series Preferred Stock tendered
hereby, certificates must be endorsed or accompanied by appropriate stock
powers, in either case, signed exactly as the name(s) of the registered
holder(s) appear(s) on the certificates for such shares of 4.85% Series
Preferred Stock. Signature(s) on any such certificates or stock powers must be
guaranteed by an Eligible Institution.
If this Letter of Transmittal or any certificate or stock power is signed
by a trustee, executor, administrator, guardian, attorney-in-fact, officer of a
corporation or other person acting in a fiduciary or representative capacity,
such person should so indicate when signing, and proper evidence satisfactory to
the Company of the authority of such person so to act must be submitted.
2. GUARANTEE OF SIGNATURES. Except as otherwise provided below, all
signatures on this Letter of Transmittal must be guaranteed by a financial
institution (including most banks, savings and loan associations and brokerage
houses) that is a member of a recognized Medallion Program approved by The
Securities Transfer Association, Inc., including the Securities Transfer Agents
Medallion Program (STAMP), the Stock Exchange Medallion Program (SEMP) and the
New York Stock Exchange, Inc. Medallion Signature Program (MSP) or any other
"eligible guarantor institution" (as such term is defined in Rule 17Ad-15 under
the Securities Exchange Act of 1934, as amended) (each an "Eligible
Institution"). Signatures on this Letter of Transmittal need not be guaranteed
(i) if this Letter of Transmittal is signed by the registered holder(s) of the
shares of 4.85% Series Preferred Stock (which term, for purposes of this
document, shall include any participant in the DTC whose name appears on a
security position listing as the owner of shares of 4.85% Series Preferred
Stock) tendered herewith and such holder(s) have not completed the boxes
entitled "Special Payment Instructions" or "Special Delivery Instructions" on
this Letter of Transmittal or (ii) if such shares of 4.85% Series Preferred
Stock is tendered for the account of an Eligible Institution. See Instruction 1
above.
3. DELIVERY OF LETTER OF TRANSMITTAL AND 4.85% SERIES PREFERRED
STOCK. This Letter of Transmittal is to be used either if certificates are to
be forwarded herewith or, unless an Agent's Message is utilized, if delivery of
shares of 4.85% Series Preferred Stock is to be made by book-entry transfer
pursuant to the procedures set forth in Section 3 of the Offer to Purchase.
Certificates for all physically delivered shares of 4.85% Series Preferred
Stock, or a confirmation of a book-entry transfer into the Depositary's account
at DTC of all shares of 4.85% Series Preferred Stock delivered electronically,
as well as a properly completed and duly executed Letter of Transmittal (or in
the case of a book-entry transfer, an Agent's Message) and any other documents
required by this Letter of Transmittal, must be received by the Depositary at
one of its addresses set forth on the front page of this Letter of Transmittal
by the Expiration Date.
The term "Agent's Message" means a message, transmitted by DTC to, and
received by, the depositary and forming a part of a book-entry confirmation
which states that DTC has received an express acknowledgment from the
participant
8
in DTC tendering the preferred shares that are the subject of such book-entry
confirmation agreeing to be bound by the terms of the Letter of Transmittal and
that we may enforce such agreement against such participant.
THE METHOD OF DELIVERY OF SHARES OF 4.85% SERIES PREFERRED STOCK AND ALL
OTHER REQUIRED DOCUMENTS IS AT THE OPTION AND RISK OF THE TENDERING SHAREHOLDER.
IF DELIVERY IS BY MAIL, WE RECOMMEND YOU USE REGISTERED MAIL WITH RETURN RECEIPT
REQUESTED, PROPERLY INSURED. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO
ENSURE TIMELY DELIVERY.
No alternative, conditional or contingent tenders will be accepted, and no
fractional shares of 4.85% Series Preferred Stock will be purchased. By
executing this Letter of Transmittal, the tendering shareholder waives any right
to receive any notice of the acceptance for payment of the shares of 4.85%
Series Preferred Stock.
4. INADEQUATE SPACE. If the space provided herein is inadequate, the
certificate numbers and/or the number of shares of 4.85% Series Preferred Stock
should be listed on a separate schedule attached hereto.
5. PARTIAL TENDERS (NOT APPLICABLE TO SHAREHOLDERS WHO TENDER BY
BOOK-ENTRY TRANSFER). If fewer than all the shares of 4.85% Series Preferred
Stock represented by any certificate delivered to the Depositary are to be
tendered, fill in the number of shares of 4.85% Series Preferred Stock which are
to be tendered in the box entitled "Number of Shares of 4.85% Series Preferred
Stock Tendered." In such case, a new certificate for the remainder of the shares
of 4.85% Series Preferred Stock represented by the old certificate will be sent
to the person(s) signing this Letter of Transmittal, unless otherwise provided
in the appropriate box on this Letter of Transmittal, as promptly as practicable
following the expiration or termination of the Offer. All shares of 4.85% Series
Preferred Stock represented by certificates delivered to the Depositary will be
deemed to have been tendered unless otherwise indicated.
6. STOCK TRANSFER TAXES. The Company will pay any stock transfer taxes
with respect to the sale and transfer of any shares of 4.85% Series Preferred
Stock to it or its order pursuant to the Offer. If, however, payment of the
purchase price is to be made to, or shares of 4.85% Series Preferred Stock not
tendered or not purchased is to be returned in the name of, any person other
than the registered holder(s), or if a transfer tax is imposed for any reason
other than the sale or transfer of shares of 4.85% Series Preferred Stock to the
Company pursuant to the Offer, then the amount of any stock transfer taxes
(whether imposed on the registered holder(s), such other person or otherwise)
will be deducted from the purchase price unless satisfactory evidence of the
payment of such taxes, or exemption therefrom, is submitted herewith.
7. SPECIAL PAYMENT AND DELIVERY INSTRUCTIONS. If the check for the
purchase price of any shares of 4.85% Series Preferred Stock purchased is to be
issued, or any shares of 4.85% Series Preferred Stock not tendered or not
purchased is to be returned, in the name of a person other than the person(s)
signing this Letter of Transmittal or if the check or any certificates for
shares of 4.85% Series Preferred Stock not tendered or not purchased are to be
mailed to someone other than the person(s) signing this Letter of Transmittal or
to the person(s) signing this Letter of Transmittal at an address other than
that shown above, the appropriate boxes on this Letter of Transmittal should be
completed. Shareholders tendering shares of 4.85% Series Preferred Stock by
book-entry transfer may request that shares of 4.85% Series Preferred Stock not
purchased be credited to such account at any of the book-entry transfer
facilities as such shareholder may designate under "Special Payment
Instructions" above. If no such instructions are given, any such shares of 4.85%
Series Preferred Stock not purchased will be returned by crediting the account
at the book-entry transfer facilities at DTC.
8. SUBSTITUTE FORM W-9 AND W-8BEN. Under the federal income tax laws, the
Depositary will be required to withhold 30% of the amount of any payments made
to certain shareholders pursuant to the Offer, as described below. In order to
avoid such backup withholding, each tendering shareholder, and, if applicable,
each other payee, must provide the Depositary with such shareholder's or payee's
correct taxpayer identification number and certify that such shareholder or
payee is not subject to such backup withholding by completing the substitute
Form W-9 included below. In general, if a shareholder or payee is an individual,
the taxpayer identification number is the Social Security number of such
individual. If the Depositary is not provided with the correct taxpayer
identification number, the shareholder or payee may be subject to a $50 penalty
imposed by the Internal Revenue Service. Certain shareholders or payees
(including, among others, all corporations and certain foreign individuals) are
not subject to these backup withholding and reporting requirements. To avoid
possible erroneous backup withholding, a shareholder who is exempt from backup
withholding should complete the substitute Form W-9 by providing his or her
correct TIN, signing and dating the form and writing "exempt" on the face of the
form. Noncorporate foreign shareholders must instead submit to the Depositary a
properly completed Form W-8BEN, Certificate of Foreign Status (which the
Depositary will provide upon request), signed under penalties of perjury,
attesting to such person's exempt status. For further information concerning
backup withholding and instructions
9
for completing the substitute Form W-9 (including how to obtain a taxpayer
identification number if you do not have one and how to complete the substitute
Form W-9 if shares are held in more than one name), consult the enclosed
Guidelines for Certification of Taxpayer Identification Number on substitute
Form W-9.
Failure to complete the substitute Form W-9 or Form W-8BEN will not, by
itself, cause shares of 4.85% Series Preferred Stock to be deemed invalidly
tendered but may require the Depositary to withhold 30% of the amount of any
payments made pursuant to the Offer. Backup withholding is not an additional
federal income tax. Rather, the federal income tax liability of a person subject
to backup withholding will be reduced by the amount of tax withheld. If
withholding results in an overpayment of taxes, a refund may be obtained
provided that the required information is furnished to the Internal Revenue
Service. NOTE: FAILURE TO COMPLETE AND RETURN THE SUBSTITUTE FORM W-9 MAY RESULT
IN BACKUP WITHHOLDING OF 30% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER.
PLEASE REVIEW THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER
IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
9. MUTILATED, LOST, STOLEN OR DESTROYED CERTIFICATES. If a certificate
that represents shares of 4.85% Series Preferred Stock has been mutilated, lost,
stolen or destroyed, the holder should (i) complete this Letter of Transmittal
and check the appropriate box and (ii) contact the Depositary immediately. The
Depositary will provide such holder with all necessary forms and instructions to
replace any mutilated, lost, stolen or destroyed certificates. The holder may
also be required to give the Company a bond as indemnity against any claim that
may be made against it with respect to the certificate(s) alleged to have been
mutilated, lost, stolen or destroyed. This Letter of Transmittal and related
documents cannot be processed until the procedures for replacing mutilated,
lost, stolen or destroyed certificates have been followed.
10. IRREGULARITIES. All questions as to the purchase price, the form of
documents, and the validity, eligibility, including time of receipt, and
acceptance of any tender of shares of 4.85% Series Preferred Stock will be
determined by the Company, in its sole discretion, and its determination shall
be final and binding. The Company reserves the absolute right to reject any or
all tenders of shares of 4.85% Series Preferred Stock that it determines are not
in proper form or the acceptance for payment of or payment for shares of 4.85%
Series Preferred Stock that may, in the opinion of the Company's counsel, be
unlawful. Except as otherwise provided in the Offer to Purchase, the Company
also reserves the absolute right to waive any of the conditions to the Offer or
any defect or irregularity in any tender of shares of 4.85% Series Preferred
Stock, and its interpretation of the terms and conditions of the Offer,
including these instructions, shall be final and binding. Unless waived, any
defects or irregularities in connection with tenders must be cured within such
time as the Company shall determine.
11. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Requests for assistance
may be made to the Information Agent or the Dealer Manager at their respective
addresses or telephone numbers set forth on the back cover of this Letter of
Transmittal. Additional copies of the Offer to Purchase and this Letter of
Transmittal may be obtained from the Information Agent.
12. RETAIL SOLICITING DEALER FEE INSTRUCTIONS. Upon the terms and subject
to the conditions set forth in this Letter of Transmittal and the Offer to
Purchase, in the event that the relevant beneficial owner so designates, the
Company will pay, promptly after the Expiration Date, to persons who were
responsible for soliciting tenders from beneficial owners whose individual
ownership is less than 2,500 shares of 4.85% Series Preferred Stock, a fee (the
"Retail Soliciting Dealer Fee") equal to $1.50 per share of 4.85% Series
Preferred Stock for which instructions to tender have been given due to the
efforts of such soliciting person, provided that the instructions and Letter of
Transmittal relating thereto have been validly delivered. The "Solicited Tenders
Box" should be completed to designate a soliciting dealer. No person may receive
the Retail Soliciting Dealer Fee unless such person is (i) a broker or dealer in
securities, including the dealer manager in its capacity as a dealer or broker,
which is a member of any national securities exchange or of the National
Association of Securities Dealers, Inc. ("NASD"), (ii) a foreign broker or
dealer not eligible for membership in the NASD which agrees to conform to the
NASD's Rules of Fair Practice in soliciting tenders outside the U.S. to the same
extent as though it were an NASD member or (iii) a bank or trust company legally
authorized to receive such fees. Beneficial owners are able to nominate such
retail soliciting dealers in the appropriate section of this Letter of
Transmittal. Participants in DTC will be required to undertake to distribute the
related Retail Soliciting Dealer Fee to such persons as appropriate. Neither the
Company nor the Dealer Manager will be responsible for making such distribution
or for ensuring that DTC participants make such distribution.
10
<Table>
- ---------------------------------------------------------------------------------------------------------------------------
SUBSTITUTE PART 1 -- Taxpayer Identification
FORM W-9 Number -- For all accounts, enter your
DEPARTMENT OF THE TREASURY taxpayer identification number in the
INTERNAL REVENUE SERVICE appropriate box. For most individuals and
sole proprietors, this is your Social --------------------------------------------
Security Number. For other entities, it is Social Security Number
your Employer Identification Number. If you
do not have a number, see "How to Obtain a OR
TIN" in the enclosed Guidelines. Note: If ---------------------------------------
the account is in more than one name, see Employer Identification Number
the chart in the enclosed Guidelines to
determine what number to enter.
------------------------------------------------------------------------------------------
PART II -- Certification -- Under penalties of perjury, I certify that:
(1)(a) The number shown on this form is my correct taxpayer identification number or (b) a
taxpayer identification number has not been issued to me and either (i) I have mailed or
delivered an application to receive a taxpayer identification number to the appropriate
Internal Revenue Service Center or Social Security Administration Office or (ii) I intend
to mail or deliver an application in the near future. I understand that if I do not provide
a taxpayer identification number by the time payment is made to me pursuant to the Offer,
30% of all reportable payments made to me pursuant to the Offer will be withheld;
(2) I am not subject to backup withholding either because (a) I am exempt from backup
withholding, or (b) I have not been notified by the Internal Revenue Service ("IRS") that I
am subject to backup withholding as a result of a failure to report all interest or
PAYER'S REQUEST FOR TAXPAYER dividends, or (c) after being so notified, the IRS had notified me that I am no longer
IDENTIFICATION NUMBER subject to backup withholding;
(3) I am a U.S. person (including a U.S. resident alien); and
(4) Any information provided on this form is true, correct and complete.
- ---------------------------------------------------------------------------------------------------------------------------
CERTIFICATION INSTRUCTIONS -- You must cross out item (2) above if you have been notified by the
IRS that you are subject to backup withholding because of underreporting interest or dividends PART III
on your tax return. However, if after being notified by the IRS that you were subject to backup Awaiting TIN [ ]
withholding you received another notification from the IRS stating that you are no longer
subject to backup withholding, do not cross out item (2). If you are awaiting the issuance of a
taxpayer identification number, check the box in Part III. If you are exempt from backup PART IV
withholding, check the box in Part IV. Exempt from Backup
Withholding [ ]
- ---------------------------------------------------------------------------------------------------------------------------
Signature:
- ---------------------------------------------------------------------------------------------------------------------------
Name: Date:
--------------------------------------------------------------------------------------------------------------------------
Address:
--------------------------------------------------------------------------------------------------------------------------
(Please Print)
</Table>
Check appropriate box: [ ] Individual/Sole proprietor [ ] Corporation
[ ] Partnership [ ] Other
- --------------------------------------------------------------------------------
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP
WITHHOLDING OF 30% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER. PLEASE
REVIEW ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER
ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
- --------------------------------------------------------------------------------
11
Questions regarding how to tender and requests for additional copies of this
document, the Offer to Purchase or other documents related to the Offer should
be directed to the Information Agent.
The Information Agent for the Offer is:
D.F. KING & CO., INC.
77 Water Street
New York, NY 10005
(888) 414-5566 (toll free)
Questions regarding the terms of the offer should be directed to the Dealer
Manager.
The Dealer Manager for the Offer is:
MERRILL LYNCH & CO.
4 World Financial Center, 7th Floor
New York, NY 10080
Attention: Liability Management Group
(888) ML4-TNDR (654-8637)
LETTER OF TRANSMITTAL
OF
NIAGARA MOHAWK POWER CORPORATION
PURSUANT TO THE OFFER TO PURCHASE
DATED FEBRUARY 27, 2002
THIS LETTER OF TRANSMITTAL IS BEING USED WITH RESPECT TO
CUMULATIVE PREFERRED STOCK, 5.25% SERIES
(CUSIP NO. 653522706)
AT A PURCHASE PRICE OF $93.58 PER SHARE
THE OFFER AND YOUR WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY
TIME, ON WEDNESDAY, MARCH 27, 2002, UNLESS EXTENDED OR EARLIER TERMINATED (SUCH
TIME AND DATE, AS THE SAME MAY BE EXTENDED OR TERMINATED, AN "EXPIRATION DATE").
The Depositary for the Offer is:
THE BANK OF NEW YORK
<Table>
By Mail: By Hand: By Overnight Delivery:
The Bank of New York The Bank of New York The Bank of New York
Niagara Mohawk PFD Tender Reorganization Services Niagara Mohawk PFD Tender
PO Box 859208 One Wall Street -- 3rd Floor 165 Bay State Road
Braintree, MA 02185-9208 New York, NY 10286 Braintree, MA 02184
</Table>
By Facsimile:
(781) 380-3388
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET FORTH
ABOVE OR TRANSMISSION OF THIS LETTER OF TRANSMITTAL
VIA A FACSIMILE NUMBER OTHER THAN AS LISTED ABOVE WILL NOT CONSTITUTE A VALID
DELIVERY TO THE DEPOSITARY.
You must sign this Letter of Transmittal in the appropriate space therefor
provided below.
YOU SHOULD READ THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL
CAREFULLY BEFORE YOU COMPLETE THIS LETTER OF TRANSMITTAL.
This Letter of Transmittal is to be used if certificates are to be forwarded
herewith or, unless an Agent's Message (as defined in the Offer to Purchase) is
utilized, if delivery of 5.25% Series Preferred Stock (as defined below) is to
be made by book-entry transfer to the Depositary's account at The Depository
Trust Company ("DTC") pursuant to the procedures set forth in Section 3 of the
Offer to Purchase.
IF YOU HAVE ANY QUESTIONS ABOUT HOW TO FILL OUT THIS LETTER OF TRANSMITTAL
PLEASE CONTACT D.F. KING & CO., THE INFORMATION AGENT, AT (888) 414-5566 (TOLL
FREE).
<Table>
- ------------------------------------------------------------------------------------------------------------------
DESCRIPTION OF 5.25% SERIES PREFERRED STOCK TENDERED
- ------------------------------------------------------------------------------------------------------------------
NAME(S) AND ADDRESS(ES) OF REGISTERED HOLDER(S)
(PLEASE FILL IN, IF BLANK, EXACTLY AS NAME(S) APPEAR(S) ON 5.25% SERIES PREFERRED STOCK TENDERED
SHARE CERTIFICATE(S)) (ATTACH ADDITIONAL LIST IF NECESSARY)
- ------------------------------------------------------------------------------------------------------------------
TOTAL NUMBER
OF SHARES OF NUMBER OF
5.25% SERIES SHARES OF
PREFERRED STOCK 5.25% SERIES
REPRESENTED PREFERRED
CERTIFICATE BY STOCK
NUMBER(S)* CERTIFICATE(S)* TENDERED**
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
TOTAL NUMBER
OF SHARES OF
5.25% SERIES
PREFERRED STOCK
- ------------------------------------------------------------------------------------------------------------------
* Need not be completed by shareholders tendering by book-entry transfer.
** Unless otherwise indicated, it will be assumed that all shares of 5.25% Series Preferred Stock represented by
any certificate delivered to the Depositary are being tendered. See Instruction 5 of this Letter of
Transmittal.
- ------------------------------------------------------------------------------------------------------------------
</Table>
Please check the applicable box below.
<Table>
[ ] I have lost my certificate(s) that represented --------
shares of Cumulative Preferred Stock, 5.25% Series and
require assistance in obtaining replacement certificate(s).
I understand that checking this box does not mean that my
shares have been validly tendered and that I must contact
the Depositary to obtain instructions for replacing lost
certificates. (See Instruction 9 of this Letter of
Transmittal.)
[ ] CHECK HERE IF CERTIFICATES FOR TENDERED 5.25% SERIES
PREFERRED STOCK ARE ENCLOSED HEREWITH.
[ ] CHECK HERE IF TENDERED 5.25% SERIES PREFERRED STOCK IS BEING
DELIVERED BY BOOK-ENTRY TRANSFER TO THE DEPOSITARY'S ACCOUNT
AT THE DTC AND COMPLETE THE FOLLOWING:
</Table>
Name of Tendering Institution
- --------------------------------------------------------------------------------
Account Number
- --------------------------------------------------------------------------------
Transaction Code Number
- --------------------------------------------------------------------------------
2
NOTE: SIGNATURES MUST BE PROVIDED BELOW.
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY.
Ladies and Gentlemen:
The undersigned hereby tenders to Niagara Mohawk Power Corporation (the
"Company"), a New York corporation, the shares in the amount set forth in the
box "Description of 5.25% Series Preferred Stock Tendered" pursuant to the
Company's offer to purchase any and all of its Cumulative Preferred Stock, 5.25%
Series (the "5.25% Series Preferred Stock"), at $93.58 per share, upon the terms
and subject to the conditions set forth in its Offer to Purchase dated February
27, 2002 (the "Offer to Purchase") and in this Letter of Transmittal (which
together constitute the "Offer").
Upon the terms and subject to the conditions of the Offer and effective
upon acceptance for payment of and payment for the 5.25% Series Preferred Stock
tendered herewith, the undersigned hereby sells, assigns and transfers to, or
upon the order of, the Company all right, title and interest in and to all the
shares of 5.25% Series Preferred Stock that are being tendered herewith, or
orders the registration of such shares of 5.25% Series Preferred Stock tendered
by book-entry transfer that are purchased pursuant to the Offer to or upon the
order of the Company, and appoints the Depositary the true and lawful agent and
attorney-in-fact of the undersigned with respect to such shares of 5.25% Series
Preferred Stock, with full power of substitution (such power of attorney being
deemed to be an irrevocable power coupled with an interest), to:
- deliver certificates representing such shares of 5.25% Series Preferred
Stock or transfer ownership of such shares of 5.25% Series Preferred
Stock on the account books maintained by the DTC, together, in any such
case, with all accompanying evidences of transfer and authenticity, to or
upon the order of the Company;
- present such shares of 5.25% Series Preferred Stock for transfer on the
books of the Company; and
- receive all benefits and otherwise exercise all rights of beneficial
ownership of such shares of 5.25% Series Preferred Stock, all in
accordance with the terms of the Offer.
The undersigned hereby represents and warrants to the Company that:
- the undersigned has full power and authority to tender, sell, assign and
transfer the shares of 5.25% Series Preferred Stock tendered hereby and
that when the same are accepted for payment by the Company, the Company
will acquire good marketable and unencumbered title thereto, free and
clear of all liens, restrictions, charges and encumbrances and not
subject to any adverse claims;
- the undersigned understands that tenders of shares pursuant to any one of
the procedures described in Section 3 of the Offer to Purchase and in the
instructions to this Letter of Transmittal will constitute the
undersigned's acceptance of the terms and conditions of the Offer,
including the undersigned's representation and warranty that (a) the
undersigned has a "net long position," within the meaning of Rule 14e-4
promulgated under the Securities Exchange Act of 1934, as amended, in the
shares or equivalent securities at least equal to the shares being
tendered, and (b) the tender of shares complies with Rule 14e-4;
- the undersigned will, upon request, execute and deliver any additional
documents deemed by the Depositary or the Company to be necessary or
desirable to complete the sale, assignment and transfer of the shares of
5.25% Series Preferred Stock tendered hereby; and
- the undersigned has read, understands and agrees to all of the terms of
the Offer.
The undersigned understands that the valid tenders of the 5.25% Series
Preferred Stock pursuant to any one of the procedures described in Section 3 of
the Offer to Purchase and in the instructions hereto will constitute an
agreement between the undersigned and the Company upon the terms and subject to
the conditions of the Offer. The undersigned acknowledges that under no
circumstances will the Company pay interest on the purchase price, including,
without limitation, by reason of any delay in making payment.
The undersigned recognizes that, under certain circumstances set forth in
the Offer to Purchase, the Company may terminate or amend the Offer or may
postpone the acceptance for payment of, or the payment for, shares of 5.25%
Series
3
Preferred Stock tendered or may not be required to purchase any shares of the
5.25% Series Preferred Stock tendered hereby or may accept for payment fewer
than all of the shares of 5.25% Series Preferred Stock tendered hereby.
Unless otherwise indicated under "Special Payment Instructions" of this
Letter of Transmittal, please issue the check for the purchase price of any
shares of 5.25% Series Preferred Stock purchased, and return any shares of 5.25%
Series Preferred Stock not tendered or not purchased, in the name(s) of the
undersigned and, in the case of shares of 5.25% Series Preferred Stock tendered
by book-entry transfer, by credit to the account at the DTC. Similarly, unless
otherwise indicated under "Special Delivery Instructions" of this Letter of
Transmittal, please mail the check for the purchase price of any shares of 5.25%
Series Preferred Stock purchased and any certificates for shares of 5.25% Series
Preferred Stock not tendered or not purchased (and accompanying documents, as
appropriate) to the undersigned at the address shown below the undersigned's
signature(s). In the event that both "Special Payment Instructions" and "Special
Delivery Instructions" are completed, please issue the check for the purchase
price of any shares of 5.25% Series Preferred Stock purchased and return any
shares of 5.25% Series Preferred Stock not tendered or not purchased in the
name(s) of, and mail said check and any certificates to, the person(s) so
indicated. The undersigned recognizes that the Company has no obligation,
pursuant to the "Special Payment Instructions," to transfer any shares of 5.25%
Series Preferred Stock from the name of the registered holder(s) thereof if the
Company does not accept for payment any shares of the 5.25% Series Preferred
Stock so tendered.
All authority conferred or agreed to be conferred by this Letter of
Transmittal will survive the death or incapacity of the undersigned, and any
obligation of the undersigned will be binding on the heirs, personal
representatives, executors, administrators, successors, assigns, trustees in
bankruptcy and legal representatives of the undersigned. Except as stated in the
Offer to Purchase, this tender is irrevocable.
4
PLEASE SIGN HERE
(TO BE COMPLETED BY ALL TENDERING HOLDERS OF 5.25% SERIES PREFERRED STOCK)
This Letter of Transmittal must be signed by the registered holder(s) of
5.25% Series Preferred Stock exactly as their name(s) appear(s) on
certificate(s) for shares of 5.25% Series Preferred Stock or, if tendered by a
participant in the DTC system, exactly as such participant's name appears on a
security position listing as the owner of shares of 5.25% Series Preferred
Stock, or by person(s) authorized to become registered holders of shares of
5.25% Series Preferred Stock by endorsements on certificates for shares of 5.25%
Series Preferred Stock or by stock powers transmitted with this Letter of
Transmittal. Endorsements on shares of 5.25% Series Preferred Stock and
signatures on stock powers by registered holders of shares of 5.25% Series
Preferred Stock not executing this Letter of Transmittal must be guaranteed by
an Eligible Institution. See Instructions 1 and 2 below. If signature is by a
trustee, executor, administrator, guardian, attorney-in-fact, officers of a
corporation or other person acting in a fiduciary or representative capacity,
such person must set forth his or her full title below under "Capacity" and
submit evidence satisfactory to the Company of such person's authority to so
act. See Instruction 1 below.
- --------------------------------------------------------------------------------
Signature(s) of Owner(s)
- --------------------------------------------------------------------------------
Signature(s) of Owner(s)
Dated:
- ------------------------------------ , 2002
Name(s):
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Please Print)
Capacity (full title):
- --------------------------------------------------------------------------------
Address:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Include Zip Code)
Area Code and Telephone Number:
- --------------------------------------------------------------------------------
PLEASE COMPLETE SUBSTITUTE FORM W-9 HEREIN
GUARANTEE OF SIGNATURE(S)
(IF REQUIRED, SEE INSTRUCTIONS 1 AND 2)
Name of Firm:
- --------------------------------------------------------------------------------
Address and Telephone Number:
- --------------------------------------------------------------------------------
Authorized Signature:
- --------------------------------------------------------------------------------
Printed Name:
- --------------------------------------------------------------------------------
Title:
- --------------------------------------------------------------------------------
Dated:
- ------------------------------------ , 2002
5
------------------------------------------------------------
SPECIAL PAYMENT INSTRUCTIONS
(SEE INSTRUCTIONS 1, 2, 6 AND 7)
To be completed ONLY if the check for the purchase price of shares of
5.25% Series Preferred Stock purchased (less the amount of any federal
income and backup withholding tax required to be withheld) or certificates
for shares of 5.25% Series Preferred Stock not tendered or not purchased
are to be issued in the name of someone other the undersigned.
Mail: [ ] check [ ] certificates to:
Name:
----------------------------------------------------
(PLEASE PRINT)
Address:
--------------------------------------------------
------------------------------------------------------------
(INCLUDING ZIP CODE)
------------------------------------------------------------
(TAXPAYER IDENTIFICATION NO.)
Credit unpurchased shares of 5.25% Series Preferred Stock by book-entry to
the book-entry transfer facility account set forth below:
DTC Account Number:
------------------------------------------------
Number of Account Party:
------------------------------------------------
------------------------------------------------------------
------------------------------------------------------------
SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 1, 2 AND 7)
To be completed ONLY if the check for the purchase price of shares of
5.25% Series Preferred Stock purchased (less the amount of any federal
income and backup withholding tax required to be withheld) or certificates
for shares of 5.25% Series Preferred Stock not tendered or not purchased
are to be mailed to someone other than the undersigned or to the
undersigned at an address other than that shown below the undersigned's
signature(s).
Mail: [ ] check [ ] certificates to:
Name:
----------------------------------------------------
(PLEASE PRINT)
Address:
--------------------------------------------------
------------------------------------------------------------
(INCLUDING ZIP CODE)
------------------------------------------------------------
6
NIAGARA MOHAWK
CUMULATIVE PREFERRED STOCK, 5.25% SERIES
COMPLETE ONLY IF APPLICABLE:
SOLICITED TENDERS
As described in the Offer to Purchase, dated February 27, 2002, Niagara
Mohawk will pay, in the amounts and on the terms and conditions set forth in the
Offer to Purchase, Retail Soliciting Dealer Fees (see Instruction 12) to
designated soliciting dealers (as described in the Offer to Purchase).
The above signed represents that the soliciting dealer that solicited and
obtained this tender is:
Name of Firm:
- --------------------------------------------------------------------------------
(PLEASE PRINT)
Name of Individual Broker:
- --------------------------------------------------------------------------------
Telephone Number of Broker:
- --------------------------------------------------------------------------------
Address:
- --------------------------------------------------------------------------------
(INCLUDE ZIP CODE)
If shares specified in this Letter of Transmittal are held by the above
signed as custodian, specify below each beneficial owner of such shares whose
tender you have solicited. Any questions as to what constitutes beneficial
ownership should be directed to the Depositary. If the space below is
inadequate, attach a separate signed schedule using the same format.
<Table>
<Caption>
NAME OF NUMBER OF PREFERRED SHARES
BENEFICIAL OWNER (MUST BE LESS THAN 2,500)
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
- ---------------------------------------------------------- ----------------------------------------------------------
</Table>
The acceptance of compensation by such soliciting dealer will constitute a
representation by it that (a) it has complied with the applicable requirements
of the Securities Exchange Act of 1934, as amended, and the applicable rules and
regulations thereunder, in connection with such solicitation; (b) it is entitled
to such compensation for such solicitation under the terms and conditions of the
Offer to Purchase; (c) in soliciting a tender, it has used no solicitation
materials other than those furnished by Niagara Mohawk; and (d) if it is a
foreign broker or dealer not eligible for membership in the National Association
of Securities Dealers, Inc. (the "NASD"), it has agreed to conform to the NASD's
Rules of Fair Practice in making solicitations. See also Instruction 12.
SOLICITATION FEE PAYMENT INSTRUCTIONS
ISSUE CHECK TO:
Firm:
- --------------------------------------------------------------------------------
(PLEASE PRINT)
Attention:
- --------------------------------------------------------------------------------
Address:
- --------------------------------------------------------------------------------
Phone Number:
---------------------
Taxpayer Identification or Social Security Number:
------------------------
7
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER
1. SIGNATURES ON LETTER OF TRANSMITTAL; STOCK POWERS AND ENDORSEMENTS. If
this Letter of Transmittal is signed by the registered holder(s) of the shares
of 5.25% Series Preferred Stock tendered hereby, the signature(s) must
correspond with the name(s) as written on the face of the certificates without
alteration, enlargement or any change whatsoever.
If any of the shares of 5.25% Series Preferred Stock tendered hereby are
held of record by two or more persons, all such persons must sign this Letter of
Transmittal.
If any of the shares of 5.25% Series Preferred Stock tendered hereby are
registered in different names on different certificates, it will be necessary to
complete, sign and submit as many separate Letters of Transmittal as there are
different registrations of certificates.
If this Letter of Transmittal is signed by the registered holder(s) of the
shares of 5.25% Series Preferred Stock tendered hereby, no endorsements of
certificates or separate stock powers are required unless payment of the
purchase price is to be made, or shares of 5.25% Series Preferred Stock not
tendered or not purchased are to be returned, in the name of any person other
than the registered holder(s). Signatures on any such certificates or stock
powers must be guaranteed by an Eligible Institution (as defined in Instruction
2).
If this Letter of Transmittal is signed by a person other than the
registered holder(s) of the shares of 5.25% Series Preferred Stock tendered
hereby, certificates must be endorsed or accompanied by appropriate stock
powers, in either case, signed exactly as the name(s) of the registered
holder(s) appear(s) on the certificates for such shares of 5.25% Series
Preferred Stock. Signature(s) on any such certificates or stock powers must be
guaranteed by an Eligible Institution.
If this Letter of Transmittal or any certificate or stock power is signed
by a trustee, executor, administrator, guardian, attorney-in-fact, officer of a
corporation or other person acting in a fiduciary or representative capacity,
such person should so indicate when signing, and proper evidence satisfactory to
the Company of the authority of such person so to act must be submitted.
2. GUARANTEE OF SIGNATURES. Except as otherwise provided below, all
signatures on this Letter of Transmittal must be guaranteed by a financial
institution (including most banks, savings and loan associations and brokerage
houses) that is a member of a recognized Medallion Program approved by The
Securities Transfer Association, Inc., including the Securities Transfer Agents
Medallion Program (STAMP), the Stock Exchange Medallion Program (SEMP) and the
New York Stock Exchange, Inc. Medallion Signature Program (MSP) or any other
"eligible guarantor institution" (as such term is defined in Rule 17Ad-15 under
the Securities Exchange Act of 1934, as amended) (each an "Eligible
Institution"). Signatures on this Letter of Transmittal need not be guaranteed
(i) if this Letter of Transmittal is signed by the registered holder(s) of the
shares of 5.25% Series Preferred Stock (which term, for purposes of this
document, shall include any participant in the DTC whose name appears on a
security position listing as the owner of shares of 5.25% Series Preferred
Stock) tendered herewith and such holder(s) have not completed the boxes
entitled "Special Payment Instructions" or "Special Delivery Instructions" on
this Letter of Transmittal or (ii) if such shares of 5.25% Series Preferred
Stock is tendered for the account of an Eligible Institution. See Instruction 1
above.
3. DELIVERY OF LETTER OF TRANSMITTAL AND 5.25% SERIES PREFERRED
STOCK. This Letter of Transmittal is to be used either if certificates are to
be forwarded herewith or, unless an Agent's Message is utilized, if delivery of
shares of 5.25% Series Preferred Stock is to be made by book-entry transfer
pursuant to the procedures set forth in Section 3 of the Offer to Purchase.
Certificates for all physically delivered shares of 5.25% Series Preferred
Stock, or a confirmation of a book-entry transfer into the Depositary's account
at DTC of all shares of 5.25% Series Preferred Stock delivered electronically,
as well as a properly completed and duly executed Letter of Transmittal (or in
the case of a book-entry transfer, an Agent's Message) and any other documents
required by this Letter of Transmittal, must be received by the Depositary at
one of its addresses set forth on the front page of this Letter of Transmittal
by the Expiration Date.
The term "Agent's Message" means a message, transmitted by DTC to, and
received by, the depositary and forming a part of a book-entry confirmation
which states that DTC has received an express acknowledgment from the
participant
8
in DTC tendering the preferred shares that are the subject of such book-entry
confirmation agreeing to be bound by the terms of the Letter of Transmittal and
that we may enforce such agreement against such participant.
THE METHOD OF DELIVERY OF SHARES OF 5.25% SERIES PREFERRED STOCK AND ALL
OTHER REQUIRED DOCUMENTS IS AT THE OPTION AND RISK OF THE TENDERING SHAREHOLDER.
IF DELIVERY IS BY MAIL, WE RECOMMEND YOU USE REGISTERED MAIL WITH RETURN RECEIPT
REQUESTED, PROPERLY INSURED. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO
ENSURE TIMELY DELIVERY.
No alternative, conditional or contingent tenders will be accepted, and no
fractional shares of 5.25% Series Preferred Stock will be purchased. By
executing this Letter of Transmittal, the tendering shareholder waives any right
to receive any notice of the acceptance for payment of the shares of 5.25%
Series Preferred Stock.
4. INADEQUATE SPACE. If the space provided herein is inadequate, the
certificate numbers and/or the number of shares of 5.25% Series Preferred Stock
should be listed on a separate schedule attached hereto.
5. PARTIAL TENDERS (NOT APPLICABLE TO SHAREHOLDERS WHO TENDER BY
BOOK-ENTRY TRANSFER). If fewer than all the shares of 5.25% Series Preferred
Stock represented by any certificate delivered to the Depositary are to be
tendered, fill in the number of shares of 5.25% Series Preferred Stock which are
to be tendered in the box entitled "Number of Shares of 5.25% Series Preferred
Stock Tendered." In such case, a new certificate for the remainder of the shares
of 5.25% Series Preferred Stock represented by the old certificate will be sent
to the person(s) signing this Letter of Transmittal, unless otherwise provided
in the appropriate box on this Letter of Transmittal, as promptly as practicable
following the expiration or termination of the Offer. All shares of 5.25% Series
Preferred Stock represented by certificates delivered to the Depositary will be
deemed to have been tendered unless otherwise indicated.
6. STOCK TRANSFER TAXES. The Company will pay any stock transfer taxes
with respect to the sale and transfer of any shares of 5.25% Series Preferred
Stock to it or its order pursuant to the Offer. If, however, payment of the
purchase price is to be made to, or shares of 5.25% Series Preferred Stock not
tendered or not purchased is to be returned in the name of, any person other
than the registered holder(s), or if a transfer tax is imposed for any reason
other than the sale or transfer of shares of 5.25% Series Preferred Stock to the
Company pursuant to the Offer, then the amount of any stock transfer taxes
(whether imposed on the registered holder(s), such other person or otherwise)
will be deducted from the purchase price unless satisfactory evidence of the
payment of such taxes, or exemption therefrom, is submitted herewith.
7. SPECIAL PAYMENT AND DELIVERY INSTRUCTIONS. If the check for the
purchase price of any shares of 5.25% Series Preferred Stock purchased is to be
issued, or any shares of 5.25% Series Preferred Stock not tendered or not
purchased is to be returned, in the name of a person other than the person(s)
signing this Letter of Transmittal or if the check or any certificates for
shares of 5.25% Series Preferred Stock not tendered or not purchased are to be
mailed to someone other than the person(s) signing this Letter of Transmittal or
to the person(s) signing this Letter of Transmittal at an address other than
that shown above, the appropriate boxes on this Letter of Transmittal should be
completed. Shareholders tendering shares of 5.25% Series Preferred Stock by
book-entry transfer may request that shares of 5.25% Series Preferred Stock not
purchased be credited to such account at any of the book-entry transfer
facilities as such shareholder may designate under "Special Payment
Instructions" above. If no such instructions are given, any such shares of 5.25%
Series Preferred Stock not purchased will be returned by crediting the account
at the book-entry transfer facilities at DTC.
8. SUBSTITUTE FORM W-9 AND W-8BEN. Under the federal income tax laws, the
Depositary will be required to withhold 30% of the amount of any payments made
to certain shareholders pursuant to the Offer, as described below. In order to
avoid such backup withholding, each tendering shareholder, and, if applicable,
each other payee, must provide the Depositary with such shareholder's or payee's
correct taxpayer identification number and certify that such shareholder or
payee is not subject to such backup withholding by completing the substitute
Form W-9 included below. In general, if a shareholder or payee is an individual,
the taxpayer identification number is the Social Security number of such
individual. If the Depositary is not provided with the correct taxpayer
identification number, the shareholder or payee may be subject to a $50 penalty
imposed by the Internal Revenue Service. Certain shareholders or payees
(including, among others, all corporations and certain foreign individuals) are
not subject to these backup withholding and reporting requirements. To avoid
possible erroneous backup withholding, a shareholder who is exempt from backup
withholding should complete the substitute Form W-9 by providing his or her
correct TIN, signing and dating the form and writing "exempt" on the face of the
form. Noncorporate foreign shareholders must instead submit to the Depositary a
properly completed Form W-8BEN, Certificate of Foreign Status (which the
Depositary will provide upon request), signed under penalties of perjury,
attesting to such person's exempt status. For further information concerning
backup withholding and instructions
9
for completing the substitute Form W-9 (including how to obtain a taxpayer
identification number if you do not have one and how to complete the substitute
Form W-9 if shares are held in more than one name), consult the enclosed
Guidelines for Certification of Taxpayer Identification Number on substitute
Form W-9.
Failure to complete the substitute Form W-9 or Form W-8BEN will not, by
itself, cause shares of 5.25% Series Preferred Stock to be deemed invalidly
tendered but may require the Depositary to withhold 30% of the amount of any
payments made pursuant to the Offer. Backup withholding is not an additional
federal income tax. Rather, the federal income tax liability of a person subject
to backup withholding will be reduced by the amount of tax withheld. If
withholding results in an overpayment of taxes, a refund may be obtained
provided that the required information is furnished to the Internal Revenue
Service. NOTE: FAILURE TO COMPLETE AND RETURN THE SUBSTITUTE FORM W-9 MAY RESULT
IN BACKUP WITHHOLDING OF 30% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER.
PLEASE REVIEW THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER
IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
9. MUTILATED, LOST, STOLEN OR DESTROYED CERTIFICATES. If a certificate
that represents shares of 5.25% Series Preferred Stock has been mutilated, lost,
stolen or destroyed, the holder should (i) complete this Letter of Transmittal
and check the appropriate box and (ii) contact the Depositary immediately. The
Depositary will provide such holder with all necessary forms and instructions to
replace any mutilated, lost, stolen or destroyed certificates. The holder may
also be required to give the Company a bond as indemnity against any claim that
may be made against it with respect to the certificate(s) alleged to have been
mutilated, lost, stolen or destroyed. This Letter of Transmittal and related
documents cannot be processed until the procedures for replacing mutilated,
lost, stolen or destroyed certificates have been followed.
10. IRREGULARITIES. All questions as to the purchase price, the form of
documents, and the validity, eligibility, including time of receipt, and
acceptance of any tender of shares of 5.25% Series Preferred Stock will be
determined by the Company, in its sole discretion, and its determination shall
be final and binding. The Company reserves the absolute right to reject any or
all tenders of shares of 5.25% Series Preferred Stock that it determines are not
in proper form or the acceptance for payment of or payment for shares of 5.25%
Series Preferred Stock that may, in the opinion of the Company's counsel, be
unlawful. Except as otherwise provided in the Offer to Purchase, the Company
also reserves the absolute right to waive any of the conditions to the Offer or
any defect or irregularity in any tender of shares of 5.25% Series Preferred
Stock, and its interpretation of the terms and conditions of the Offer,
including these instructions, shall be final and binding. Unless waived, any
defects or irregularities in connection with tenders must be cured within such
time as the Company shall determine.
11. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Requests for assistance
may be made to the Information Agent or the Dealer Manager at their respective
addresses or telephone numbers set forth on the back cover of this Letter of
Transmittal. Additional copies of the Offer to Purchase and this Letter of
Transmittal may be obtained from the Information Agent.
12. RETAIL SOLICITING DEALER FEE INSTRUCTIONS. Upon the terms and subject
to the conditions set forth in this Letter of Transmittal and the Offer to
Purchase, in the event that the relevant beneficial owner so designates, the
Company will pay, promptly after the Expiration Date, to persons who were
responsible for soliciting tenders from beneficial owners whose individual
ownership is less than 2,500 shares of 5.25% Series Preferred Stock, a fee (the
"Retail Soliciting Dealer Fee") equal to $1.50 per share of 5.25% Series
Preferred Stock for which instructions to tender have been given due to the
efforts of such soliciting person, provided that the instructions and Letter of
Transmittal relating thereto have been validly delivered. The "Solicited Tenders
Box" should be completed to designate a soliciting dealer. No person may receive
the Retail Soliciting Dealer Fee unless such person is (i) a broker or dealer in
securities, including the dealer manager in its capacity as a dealer or broker,
which is a member of any national securities exchange or of the National
Association of Securities Dealers, Inc. ("NASD"), (ii) a foreign broker or
dealer not eligible for membership in the NASD which agrees to conform to the
NASD's Rules of Fair Practice in soliciting tenders outside the U.S. to the same
extent as though it were an NASD member or (iii) a bank or trust company legally
authorized to receive such fees. Beneficial owners are able to nominate such
retail soliciting dealers in the appropriate section of this Letter of
Transmittal. Participants in DTC will be required to undertake to distribute the
related Retail Soliciting Dealer Fee to such persons as appropriate. Neither the
Company nor the Dealer Manager will be responsible for making such distribution
or for ensuring that DTC participants make such distribution.
10
<Table>
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SUBSTITUTE PART 1 -- Taxpayer Identification
FORM W-9 Number -- For all accounts, enter your
DEPARTMENT OF THE TREASURY taxpayer identification number in the
INTERNAL REVENUE SERVICE appropriate box. For most individuals and
sole proprietors, this is your Social --------------------------------------------
Security Number. For other entities, it is Social Security Number
your Employer Identification Number. If you
do not have a number, see "How to Obtain a OR
TIN" in the enclosed Guidelines. Note: If ---------------------------------------
the account is in more than one name, see Employer Identification Number
the chart in the enclosed Guidelines to
determine what number to enter.
------------------------------------------------------------------------------------------
PART II -- Certification -- Under penalties of perjury, I certify that:
(1)(a) The number shown on this form is my correct taxpayer identification number or (b) a
taxpayer identification number has not been issued to me and either (i) I have mailed or
delivered an application to receive a taxpayer identification number to the appropriate
Internal Revenue Service Center or Social Security Administration Office or (ii) I intend
to mail or deliver an application in the near future. I understand that if I do not provide
a taxpayer identification number by the time payment is made to me pursuant to the Offer,
30% of all reportable payments made to me pursuant to the Offer will be withheld;
(2) I am not subject to backup withholding either because (a) I am exempt from backup
withholding, or (b) I have not been notified by the Internal Revenue Service ("IRS") that I
am subject to backup withholding as a result of a failure to report all interest or
PAYER'S REQUEST FOR TAXPAYER dividends, or (c) after being so notified, the IRS had notified me that I am no longer
IDENTIFICATION NUMBER subject to backup withholding;
(3) I am a U.S. person (including a U.S. resident alien); and
(4) Any information provided on this form is true, correct and complete.
- ---------------------------------------------------------------------------------------------------------------------------
CERTIFICATION INSTRUCTIONS -- You must cross out item (2) above if you have been notified by the
IRS that you are subject to backup withholding because of underreporting interest or dividends PART III
on your tax return. However, if after being notified by the IRS that you were subject to backup Awaiting TIN [ ]
withholding you received another notification from the IRS stating that you are no longer
subject to backup withholding, do not cross out item (2). If you are awaiting the issuance of a
taxpayer identification number, check the box in Part III. If you are exempt from backup PART IV
withholding, check the box in Part IV. Exempt from Backup
Withholding [ ]
- ---------------------------------------------------------------------------------------------------------------------------
Signature:
- ---------------------------------------------------------------------------------------------------------------------------
Name: Date:
--------------------------------------------------------------------------------------------------------------------------
Address:
--------------------------------------------------------------------------------------------------------------------------
(Please Print)
</Table>
Check appropriate box: [ ] Individual/Sole proprietor [ ] Corporation
[ ] Partnership [ ] Other
- --------------------------------------------------------------------------------
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP
WITHHOLDING OF 30% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER. PLEASE
REVIEW ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER
ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
- --------------------------------------------------------------------------------
11
Questions regarding how to tender and requests for additional copies of this
document, the Offer to Purchase or other documents related to the Offer should
be directed to the Information Agent.
The Information Agent for the Offer is:
D.F. KING & CO., INC.
77 Water Street
New York, NY 10005
(888) 414-5566 (toll free)
Questions regarding the terms of the offer should be directed to the Dealer
Manager.
The Dealer Manager for the Offer is:
MERRILL LYNCH & CO.
4 World Financial Center, 7th Floor
New York, NY 10080
Attention: Liability Management Group
(888) ML4-TNDR (654-8637)