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REGISTRATION NO.
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
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MINNESOTA POWER & LIGHT COMPANY
(Exact name of registrant as specified in its charter)
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MINNESOTA 41-0418150
(State or other jurisdiction (IRS Employer
of incorporation or organization) Identification No.)
30 WEST SUPERIOR STREET
DULUTH, MINNESOTA 55802
(218) 722-2641
(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)
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DAVID G. GARTZKE PHILIP R. HALVERSON, ROBERT J. REGER,
Senior Vice Esq. JR., Esq.
President-Finance Vice President, Reid & Priest LLP
and Chief Financial General Counsel and 40 West 57th Street
Officer Secretary New York, New York
30 West Superior 30 West Superior 10019
Street Street (212) 603-2000
Duluth, Minnesota Duluth, Minnesota
55802 55802
(218) 722-2641 (218) 722-2641
(Names, addresses, including zip codes, and telephone numbers,
including area codes, of agents for service)
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It is respectfully requested that the Commission
send copies of all notices, orders and communications to:
MICHAEL CONNOLLY, Esq.
Morrison Cohen Singer & Weinstein, LLP
750 Lexington Avenue
New York, New York 10022
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE
PUBLIC: As soon as practicable after the registration statement
becomes effective.
If the only securities being registered on this Form are
being offered pursuant to dividend or interest reinvestment
plans, please check the following box.[ ]
If any of the securities being registered on this Form are
to be offered on a delayed or continuous basis pursuant to Rule
415 under the Securities Act of 1933, other than securities
offered only in connection with dividend or interest reinvestment
plans, check the following box.[X]
If this Form is filed to register additional securities for
an offering pursuant to Rule 462(b) under the Securities Act,
please check the following box and list the Securities Act
registration statement number of the earlier effective
registration statement for the same offering.[ ]
If this Form is a post-effective amendment filed pursuant
to Rule 462(c) under the Securities Act, check the following box
and list the Securities Act registration statement number of the
earlier effective registration for the same offering.[ ]
If delivery of the prospectus is expected to be made
pursuant to Rule 434, please check the following box.[ ]
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CALCULATION OF REGISTRATION FEE
=========================================================================
PROPOSED PROPOSED
MAXIMUM MAXIMUM
TITLE OF EACH CLASS AMOUNT TO OFFERING AGGREGATE AMOUNT OF
OF SECURITIES BE PRICE OFFERING REGISTRATION
TO BE REGISTERED REGISTERED PER UNIT(1) PRICE(1) FEE
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Common Stock, 3,000,000 $40 3/32 $120,281,250 $35,483
without par value Shares
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Preferred Share 3,000,000 --- --- ---(3)
Purchase Rights Rights(2)
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(1) Estimated solely for the purpose of calculating the
registration fee, pursuant to Rule 457(c), on the basis of
the average of the high and low prices of the registrant's
Common Stock on the New York Stock Exchange composite tape
on May 5, 1998.
(2) The Preferred Share Purchase Rights ("Rights") are attached
to and will trade with the Common Stock. The value
attributable to the Rights, if any, is reflected in the
market price of the Common Stock.
(3) Since no separate consideration is paid for the Rights, the
registration fee for such securities is included in the fee
for the Common Stock.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON
SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE
DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH
SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL
THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION,
ACTING PURSUANT TO SAID SECTION 8(A), MAY DETERMINE.
=================================================================
Information contained herein is subject to completion or
amendment. A Registration Statement relating to these securities
has been filed with the Securities and Exchange Commission.
These securities may not be sold nor may offers to buy be
accepted prior to the time the Registration Statement becomes
effective. This prospectus shall not constitute an offer to sell
or the solicitation of an offer to buy nor shall there be any
sale of these securities in any jurisdiction in which such offer,
solicitation, or sale would be unlawful prior to registration or
qualification under the securities laws of any such jurisdiction.
SUBJECT TO COMPLETION
DATED MAY 8, 1998
PROSPECTUS
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3,000,000 SHARES
MINNESOTA POWER & LIGHT COMPANY
COMMON STOCK
(WITHOUT PAR VALUE)
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Minnesota Power & Light Company ("Company" or "Minnesota
Power") intends to offer from time to time not to exceed
3,000,000 shares of its Common Stock, without par value, ("Common
Stock") and the preferred share purchase rights attached thereto
("Rights") (collectively, the "New Stock"). The New Stock will
be offered on terms to be determined at the time of sale. This
Prospectus will be supplemented by a prospectus supplement
("Prospectus Supplement") which will set forth, as applicable,
the number of shares, the purchase price and other specific terms
of the New Stock in respect of which this Prospectus and the
Prospectus Supplement are delivered ("Offered Stock").
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION
OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
---------------------
The New Stock may be sold directly by the Company or
through agents designated from time to time or through dealers or
underwriters. If any agent of the Company or any underwriters
are involved in the sales of the New Stock, the names of such
agents or such underwriters and any applicable commissions or
discounts and the net proceeds to the Company will be set forth
in the Prospectus Supplement.
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The date of this Prospectus is .
AVAILABLE INFORMATION
The Company is subject to the informational requirements of
the Securities Exchange Act of 1934, as amended ("1934 Act") and,
in accordance therewith, files reports, proxy statements and
other information with the Securities and Exchange Commission
("Commission"). Such reports, proxy statements and other
information filed by the Company may be inspected and copied at
the public reference facilities maintained by the Commission at
450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549, and at
the following Regional Offices of the Commission: New York
Regional Office, 7 World Trade Center, 13th Floor, New York, New
York 10048; and Chicago Regional Office, Citicorp Center, 500
West Madison Street, Suite 1400, Chicago, Illinois 60661. Copies
of such material may also be obtained at prescribed rates from
the Public Reference Section of the Commission at 450 Fifth
Street, N.W., Washington, D.C. 20549. The Commission maintains a
Web site (http://www.sec.gov) that contains reports, proxy
statements and other information filed electronically by the
Company. The Common Stock and the Rights are listed on the New
York Stock Exchange. Reports and other information concerning the
Company may be inspected and copied at the office of such
Exchange at 20 Broad Street, New York, New York. In addition, the
Company's 5% Preferred Stock, $100 par value, is listed on the
American Stock Exchange. Reports and other information concerning
the Company may also be inspected and copied at the office of
such Exchange at 86 Trinity Place, New York, New York.
----------------------
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents, filed by the Company with the
Commission pursuant to the 1934 Act, are hereby incorporated by
reference:
(1) The Company's Annual Report on Form 10-K for
the year ended December 31, 1997 ("1997 Form
10-K").
(2) The Company's Quarterly Report on Form 10-Q
for the quarter ended March 31, 1998.
Each document filed subsequent to the date of this
Prospectus pursuant to Section 13(a), 13(c), 14 or 15(d) of the
1934 Act prior to the termination of the offering made by this
Prospectus shall be deemed to be incorporated by reference in
this Prospectus and shall be a part hereof from the date of
filing of such document; provided, however, that the documents
enumerated above or subsequently filed by the Company pursuant to
Section 13 or 15(d) of the 1934 Act prior to the filing with the
Commission of the Company's most recent Annual Report on Form 10-
K shall not be incorporated by reference in this Prospectus or be
a part hereof from and after the filing of such most recent
Annual Report on Form 10-K. The documents which are incorporated
by reference in this Prospectus are sometimes hereinafter
referred to as the "Incorporated Documents."
Any statement contained in a document incorporated or deemed
to be incorporated by reference herein shall be deemed to be
modified or superseded for purposes of this Prospectus to the
extent that a statement contained herein or in any other
subsequently filed document which is deemed to be incorporated by
reference herein modifies or supersedes such statement. Any such
statement so modified or superseded shall not be deemed, except
as so modified or superseded, to constitute a part of this
Prospectus.
The Company will provide without charge to each person,
including any beneficial owner, to whom a copy of this Prospectus
is delivered, upon the written or oral request of any such
person, a copy of any document referred to above which has been
or may be incorporated in this Prospectus by reference, other
than exhibits to such documents (unless such exhibits are
specifically incorporated by reference into such documents).
Requests for such copies should be directed to: Shareholder
Services, Minnesota Power, 30 West Superior Street, Duluth,
Minnesota 55802, telephone number (218) 723-3974 or (800) 535-
3056.
2
THE COMPANY
Minnesota Power, a broadly diversified service company
incorporated under the laws of the State of Minnesota in 1906,
has operations in four business segments: (1) Electric
Operations, which include electric and gas services, and coal
mining; (2) Water Services, which include water and wastewater
services; (3) Automotive Services, which include a network of
vehicle auctions, a finance company and an auto transport
company; and (4) Investments, which include a securities
portfolio, a 21 percent equity investment in a financial guaranty
reinsurance and insurance company, and real estate operations.
Corporate Charges represent general corporate expenses, including
interest, not specifically allocated to any one business segment.
As of March 31, 1998 the Company and its subsidiaries had
approximately 6,900 employees. The principal executive offices of
the Company are located at 30 West Superior Street, Duluth,
Minnesota 55802, telephone number (218) 722-2641.
(Unaudited)
Three Months Ended
Year Ended December 31 March 31
---------------------------- ------------------
1997 1996 1995 1998 1997
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MILLIONS
OPERATING REVENUE
AND INCOME
Electric
Operations $541.9 $529.2 $503.5 $134.0 $131.5
Water Services 95.5 85.2 66.1 20.8 20.6
Automotive
Services (a) 255.5 183.9 61.6 76.7 60.5
Investments 60.9 49.9 43.7 15.2 9.5
Corporate Charges (0.2) (1.3) (2.0) (0.1) 0.0
------ ------ ------ ------ ------
$953.6 $846.9 $672.9 $246.6 $222.1
====== ====== ====== ====== ======
NET INCOME
Electric
Operations $ 43.1 $ 39.4 $ 41.0 $ 9.5 $ 12.3
Water Services 8.2 5.4 (1.0) 0.7 0.4
Automotive
Services (a) 14.0 3.7 - 5.4 3.2
Investments 32.1 38.1 41.3 8.3 5.6
Corporate Charges (19.8) (17.4) (19.4) (5.4) (5.4)
------ ------ ------ ------ ------
77.6 69.2 61.9 18.5 16.1
Discontinued
Operations (b) - - 2.8 - -
------ ------ ------ ------ ------
$ 77.6 $ 69.2 $ 64.7 $ 18.5 $ 16.1
====== ====== ====== ====== ======
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BASIC AND DILUTED
EARNINGS PER SHARE
OF COMMON STOCK
Continuing
Operations $2.47 $2.28 $2.06 $.58 $.52
Discontinued
Operations - - .10 - -
----- ----- ----- ----- -----
$2.47 $2.28 $2.16 $.58 $.52
===== ===== ===== ===== =====
AVERAGE SHARES OF
COMMON STOCK -
MILLIONS 30.6 29.3 28.5 31.1 30.3
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(a) The Company purchased 80 percent of ADESA, including
AFC and Great Rigs, on July 1, 1995, another 3 percent
in January 1996 and the remaining 17 percent in August
1996.
(b) On June 30, 1995 the Company sold its interest in a
paper and pulp business to Consolidated Papers, Inc.
3
ELECTRIC OPERATIONS
Electric Operations generate, transmit, distribute and
market electricity. Minnesota Power provides electricity to
123,000 customers in northeastern Minnesota. MPEX, a division of
Minnesota Power, is an expansion of the Company's inter-utility
marketing group which has been a buyer and seller of capacity and
energy for over 25 years in the wholesale power market. The
customers of MPEX are other power suppliers in the Midwest and
Canada. MPEX also contracts with its customers to provide hourly
energy scheduling and power trading services. The Company's
wholly owned subsidiary, Superior Water, Light and Power Company,
sells electricity to 14,000 customers and natural gas to 11,000
customers, and provides water to 10,000 customers in northwestern
Wisconsin. BNI Coal, Ltd. ("BNI Coal"), another wholly owned
subsidiary of the Company, owns and operates a lignite mine in
North Dakota. Two electric generating cooperatives, Minnkota
Power Cooperative, Inc. and Square Butte Electric Cooperative
("Square Butte"), presently consume virtually all of BNI Coal's
production of lignite coal under coal supply agreements extending
to 2027. Under an agreement with Square Butte, Minnesota Power
purchases about 71 percent of the output from the Square Butte
unit which is capable of generating up to 455 megawatts ("MW").
In 1997 industrial customers contributed about half of the
Company's electric operating revenue. The Company has large power
contracts to sell power to eleven industrial customers (five
taconite producers, four paper and pulp mills, and two pipeline
companies) each requiring 10 MW or more of power. These
contracts, which have termination dates ranging from April 2001
to October 2008, require the Company to have a certain amount of
generating capacity available. In turn each customer is required
to pay a minimum monthly demand charge that covers the fixed costs
associated with having capacity available to serve the customer,
including a return on common equity. Under the contracts,
industrial customers pay demand charges for the base portion of
their capacity needs on a take-or-pay basis for the entire term
of the contract, while most customers are permitted bi-annually
(coincident with each power pool season) to establish their
capacity needs above this base, thereby committing to additional
demand charges. In addition to the demand charge, each customer
is billed an energy charge for each kilowatthour used that recovers
the variable costs incurred in generating electricity.
WATER SERVICES
Water Services include regulated and non-regulated wholly
owned subsidiaries of the Company. Florida Water Services
Corporation, which is the largest investor owned water supplier
in Florida, provides water to 119,000 customers and wastewater
treatment services to 53,000 customers. Heater Utilities, Inc.
provides water to 29,000 customers and wastewater treatment
services to 2,000 customers in North Carolina. Instrumentation
Services, Inc. ("ISI") provides predictive maintenance and
instrumentation consulting services to water and wastewater
utilities, and other industrial operations throughout the
southeastern part of the United States as well as Texas and
Minnesota. U.S. Maintenance and Management Services Corporation
("USM&M") was incorporated in 1997 to complement ISI's
operations. USM&M provides maintenance services to water and
wastewater utilities, and other industrial operations primarily
in Florida. Americas' Water Services Corporation, which is
headquartered near Chicago, Illinois, offers contract management,
operations and maintenance services to governments and industries
in the Americas.
AUTOMOTIVE SERVICES
Automotive Services include wholly owned subsidiaries
operating as integral parts of the vehicle auction business:
ADESA Corporation ("ADESA"), a network of vehicle auctions;
Automotive Finance Corporation ("AFC"), a finance company; and
Great Rigs Incorporated ("Great Rigs"), an auto transport
company. ADESA is the third largest vehicle auction network in
the United States. Headquartered in Indianapolis, Indiana, ADESA
owns and operates 25 vehicle auction facilities in the United
States and Canada through which used cars and other vehicles are
purchased and sold to franchised automobile dealers and licensed
used car dealers. In April 1998 ADESA reached agreements to
purchase three additional vehicle auctions which will increase
the number of facilities to 28. Sellers at ADESA's auctions
4
include domestic and foreign auto manufacturers, car dealers,
automotive fleet/lease companies, banks and finance companies.
AFC provides inventory financing for wholesale and retail
automobile dealers who purchase vehicles from ADESA auctions,
independent auctions and other auction chains. AFC is
headquartered in Indianapolis, Indiana, and has 57 loan
production offices located at most ADESA auctions, as well as at
or near independently owned auto auctions. From these offices car
dealers obtain credit to purchase vehicles at any of the over 300
auctions approved by AFC. Great Rigs is one of the nation's
largest independent used automobile transport carriers with 140
leased automotive carriers. Headquartered in Moody, Alabama,
Great Rigs offers customers pick up and delivery service through
11 strategically located transportation hubs. Customers of Great
Rigs include ADESA auctions, car dealerships, vehicle
manufacturers, leasing companies, finance companies and other
auctions.
INVESTMENTS
Minnesota Power's securities portfolio is managed by
selected outside managers as well as internal managers. It is
intended to provide stable earnings and liquidity, and is
available for investment in existing businesses, acquisitions and
other corporate purposes. The Company's objective is to maintain
corporate liquidity between 7 percent and 10 percent of total
assets ($150 million to $200 million). The Company plans to
continue to concentrate in market-neutral investment strategies
designed to provide stable and acceptable returns without
sacrificing needed liquidity. The securities portfolio is
structured to perform at an after-tax return between 7 percent
and 9 percent. While these returns may seem modest compared to
broader market indices over the past three years, the Company
believes its investment strategy is a wise course in a volatile
economic environment. Returns will continue to be partially
dependent on general market conditions. The Company's investment
in the securities portfolio at March 31, 1998 was approximately
$190 million.
Minnesota Power owns 3.3 million shares of Capital Re
Corporation ("Capital Re"), a specialty insurance and reinsurance
business. Capital Re's product lines currently include financial
guaranty, mortgage, title, financial, credit and specialty
reinsurance, and specialty insurance through its participation in
Lloyds of London. Capital Re trades on the New York Stock
Exchange under the symbol KRE. Minnesota Power's ownership
represents 21 percent of the 16 million total outstanding shares
of Capital Re. The market value of the Company's investment in
Capital Re was $210 million at March 31, 1998 based on a
Capital Re share price of $64.25. The Company accounts for its
investment in Capital Re under the equity method and the carrying
value was $123 million at March 31, 1998.
The Company owns 80 percent of Lehigh Acquisition
Corporation ("Lehigh"), a real estate company in Florida. Lehigh
owns 2,500 acres of land and approximately 4,000 home sites near
Fort Myers, Florida; 1,000 home sites in Citrus County, Florida;
and 2,700 home sites and 12,000 acres of residential, commercial
and industrial land at Palm Coast, Florida.
USE OF PROCEEDS
The Company is offering a maximum of 3,000,000 shares of its
New Stock. The net proceeds to be received from the issuance and
sale of the New Stock will be used for general corporate purposes
which may include, among other things, acquisitions.
Reference is made to the Incorporated Documents with respect
to the Company's general capital requirements and general
financing plans and capabilities.
5
DIVIDENDS AND PRICE RANGE
The following table sets forth the high and low sales prices
per share of the Common Stock reported on the New York Stock
Exchange composite tape as published in The Wall Street Journal
and the dividends paid for the indicated periods.
PRICE RANGE
----------- DIVIDENDS
HIGH LOW PER SHARE
---- --- ---------
1996 First Quarter . . . . . . . $29 3/4 $26 1/8 $ 0.51
Second Quarter . . . . . . 29 26 0.51
Third Quarter . . . . . . . 28 3/4 26 0.51
Fourth Quarter . . . . . . 28 7/8 26 3/8 0.51
1997 First Quarter . . . . . . . $29 $27 1/4 $ 0.51
Second Quarter . . . . . . 30 5/8 27 0.51
Third Quarter . . . . . . . 36 5/16 30 1/4 0.51
Fourth Quarter . . . . . . 44 35 3/16 0.51
1998 First Quarter . . . . . . . $43 7/16 $39 1/8 $ 0.51
Second Quarter (through May
7, 1998) . . . . . . . . . 42 15/16 39 3/16
The last reported sale price of the Common Stock on the New
York Stock Exchange composite tape on May 7, 1998, was $39.25
per share.
The Company has paid dividends without interruption on its
Common Stock since 1948, the date of initial distribution of the
Common Stock by American Power & Light Company, the former holder
of all such stock.
The Company has a Dividend Reinvestment and Stock Purchase
Plan ("Plan"). The Plan provides investors ("Participants") with
a convenient method of acquiring shares of Common Stock through
(i) the reinvestment in Common Stock of all or a portion of the
cash dividends payable on the Participant's holdings of Common
Stock and Preferred Stocks, and/or (ii) the investment of
optional cash payments pursuant to the terms of the Plan. The
Company reserves the right to suspend, modify, amend or terminate
the Plan at any time and to interpret and regulate the Plan as it
deems necessary or desirable in connection with the operation of
the Plan. Shares of Common Stock are offered for sale under the
Plan only by means of a separate prospectus available upon
request from the Company.
DESCRIPTION OF COMMON STOCK
General. The following statements relating to the Common
Stock are merely an outline and do not purport to be complete.
They are qualified in their entirety by reference to the
Company's Articles of Incorporation ("Articles of Incorporation")
and the Mortgage and Deed of Trust of the Company. Reference is
also made to the laws of the State of Minnesota.
The Company's authorized capital stock consists of
65,000,000 shares of Common Stock, without par value, 116,000
shares of 5% Preferred Stock, $100 par value, 1,000,000 shares of
Serial Preferred Stock, without par value, and 2,500,000 shares
of Serial Preferred Stock A, without par value. The Company is
proposing to amend the Articles of Incorporation to increase the
number of authorized shares of Common Stock from 65,000,000 to
130,000,000. This proposal is being presented to the Company's
shareholders for approval at the Annual Meeting of Shareholders
to be held on May 12, 1998.
Dividend Rights. The Common Stock is entitled to all
dividends after full provision for dividends on the issued and
outstanding Preferred Stocks and the sinking fund requirements of
the Serial Preferred Stock A, $7.125 Series and $6.70 Series.
6
The Articles of Incorporation provide that so long as any
shares of the Company's Preferred Stocks are outstanding, cash
dividends on Common Stock are restricted to 75 percent of
available net income when Common Stock equity is or would become
less than 25 percent but more than 20 percent of total
capitalization. This restriction becomes 50 percent when such
equity is or would become less than 20 percent. See Note 10 to
Consolidated Financial Statements incorporated by reference in
the Company's 1997 Form 10-K.
Voting Rights (Non-Cumulative Voting). Holders of Common
Stock are entitled to notice of and to vote at any meeting of
shareholders. Each share of Common Stock, as well as each share
of the issued and outstanding Preferred Stocks, is entitled to
one vote. Since the holders of such shares do not have
cumulative voting rights, the holders of more than 50 percent of
the shares voting can elect all the Company's directors, and in
such event the holders of the remaining shares voting (less than
50 percent) cannot elect any directors. In addition, the
Preferred Stocks are expressly entitled, as one class, to elect a
majority of the directors (the Common Stock, as one class,
electing the minority) whenever dividends on any of such
Preferred Stocks shall be in default in the amount of four
quarterly payments and thereafter until all such dividends in
default shall have been paid. The Articles of Incorporation
include detailed procedures and other provisions relating to
these rights and their termination, such as quorums, terms of
directors elected, vacancies, class voting as between Preferred
Stocks and Common Stock, meetings, adjournments and other
matters.
The Articles of Incorporation contain certain provisions
which make it difficult to obtain control of the Company through
transactions not having the approval of the Board of Directors,
including:
(1) A provision requiring the affirmative vote of 75
percent of the outstanding shares of all classes of
capital stock of the Company, present and entitled to
vote, in order to authorize certain "Business
Combinations." Any such Business Combination is
required to meet certain "fair price" and procedural
requirements. Neither a 75 percent stockholder vote
nor "fair price" is required for any Business
Combination which has been approved by a majority of
the "Disinterested Directors."
(2) A provision permitting a majority of the Disinterested
Directors to determine whether the above requirements
have been satisfied.
(3) A provision providing that certain of the Articles of
Incorporation cannot be altered unless approved by 75
percent of the outstanding shares of all classes of
capital stock, present and entitled to vote, unless
such alteration is recommended to the shareholders by a
majority of the Disinterested Directors.
Liquidation Rights. After satisfaction of creditors and of
the preferential liquidation rights of the outstanding Preferred
Stocks ($100 per share plus unpaid accumulated dividends), the
holders of the Common Stock are entitled to share ratably in the
distribution of all remaining assets.
Miscellaneous. Holders of Common Stock have no preemptive
or conversion rights.
The Common Stock is listed on the New York Stock Exchange.
The transfer agents and registrars for the Common Stock are
Norwest Bank Minnesota, N.A. and the Company.
DESCRIPTION OF PREFERRED SHARE PURCHASE RIGHTS
Reference is made to the Rights Agreement, dated as of July
24, 1996 ("Rights Plan") between the Company and the Corporate
Secretary of the Company, as Rights Agent. The description of
the Rights set forth below does not purport to be complete and is
qualified in its entirety by reference to the Rights Plan.
Reference is also made to the laws of the State of Minnesota.
7
On July 24, 1996 the Board of Directors of the Company
declared a dividend distribution of one Right for each
outstanding share of Common Stock to shareholders of record at
the close of business on July 24, 1996 ("Record Date") and
authorized the issuance of one Right with respect to each share
of Common Stock that becomes outstanding between the Record Date
and July 23, 2006 or such earlier time as the Rights are
redeemed. Except as described below, each Right, when
exercisable, entitles the registered holder to purchase from the
Company one one-hundredth of a share of Junior Serial Preferred
Stock A, without par value ("Serial Preferred"), at a price of
$90 per one one-hundredth share ("Purchase Price"), subject to
adjustment.
No separate Right Certificates will be distributed. The
Rights will be evidenced by the Common Stock certificates
together with a copy of the Summary of Rights Plan and not by
separate certificates until the earlier to occur (i) 10 days
following a public announcement that a person or group of
affiliated or associated persons (an "Acquiring Person") has
acquired, or obtained the right to acquire, beneficial ownership
of 15 percent or more of the outstanding shares of Common Stock
(the "Stock Acquisition Date") or (ii) 15 business days (or such
later date as may be determined by action of the Board of
Directors prior to the time that any person becomes an Acquiring
Person) following the commencement of (or a public announcement
of an intention to make) a tender or exchange offer if, upon
consummation thereof, such person or group would be the
beneficial owner of 15 percent or more of such outstanding shares
of Common Stock (the earlier of such dates being called the
"Distribution Date").
Until the Distribution Date, the Rights will be transferred
with and only with the Common Stock. Until the Distribution Date
(or earlier redemption, expiration or termination of the Rights),
the transfer of any certificates for Common Stock, with or
without a copy of the Summary of Rights Plan, will also
constitute the transfer of the Rights associated with the Common
Stock represented by such certificates. As soon as practicable
following the Distribution Date, separate certificates evidencing
the Rights ("Right Certificates") will be mailed to holders of
record of the Common Stock as of the close of business on the
Distribution Date and, thereafter, such separate Right
Certificates alone will evidence the Rights.
Each whole share of Serial Preferred will have a minimum
preferential quarterly dividend rate equal to the greater of $51
per share or, subject to anti-dilution adjustment, 100 times the
dividend declared on the Common Stock. In the event of
liquidation, no distribution will be made to the holders of
Common Stock unless, prior thereto, the holders of the Serial
Preferred have received a liquidation preference of $100 per
share, plus accrued and unpaid dividends. Holders of the Serial
Preferred will be entitled to notice of and to vote at any
meeting of the Company's shareholders. Each whole share of
Serial Preferred is entitled to one vote. Such shares do not
have cumulative voting rights. The Serial Preferred, together
with the issued and outstanding shares of the other Preferred
Stocks of the Company, will be expressly entitled, as one class,
to elect a majority of directors (the Common Stock electing the
minority) whenever dividends on any of the Preferred Stocks shall
be in default in the amount of four quarterly payments and
thereafter until all such dividends in default shall have been
paid. In the event of any merger, consolidation or other
transaction in which shares of Common Stock are exchanged for or
converted into other securities and/or property, each whole share
of Serial Preferred will be entitled to receive, subject to anti-
dilution adjustment, 100 times the amount into which or for which
each share of Common Stock is so exchanged or converted. The
shares of Serial Preferred are not redeemable by the Company.
The Rights are not exercisable until the Distribution Date
and will expire at the earliest of (i) July 23, 2006 ("Final
Expiration Date"), (ii) the redemption of the Rights by the
Company as described below, and (iii) the exchange of all Rights
for Common Stock as described below.
In the event that any person (other than the Company, its
affiliates or any person receiving newly-issued shares of Common
Stock directly from the Company) becomes the beneficial owner of
15 percent or more of the then outstanding shares of Common
Stock, each holder of a Right will thereafter have a right to
receive, upon exercise at the then current exercise price of the
Right, Common Stock (or, in certain circumstances, cash, property
or other securities of the Company) having a value equal to two
times the exercise price of the Right. The Rights Plan contains
an exemption for any issuance of Common Stock by the Company
directly to any person (for example, in a private placement or an
8
acquisition by the Company in which Common Stock is used as
consideration), even if that person would become the beneficial
owner of 15 percent or more of the Common Stock, provided that
such person does not acquire any additional shares of Common
Stock.
In the event that, at any time following the Stock
Acquisition Date, the Company is acquired in a merger or other
business combination transaction or 50 percent or more of the
Company's assets or earning power are sold, proper provision will
be made so that each holder of a Right will thereafter have the
right to receive, upon exercise at the then current exercise
price of the Right, common stock of the acquiring or surviving
company having a value equal to two times the exercise price of
the Right.
Notwithstanding the foregoing, following the occurrence of
any of the events set forth in the preceding two paragraphs (the
"Triggering Events"), any Rights that are, or (under certain
circumstances specified in the Rights Plan) were, beneficially
owned by any Acquiring Person will immediately become null and
void.
The Purchase Price payable, and the number of shares of
Serial Preferred or other securities or property issuable, upon
exercise of the Rights, are subject to adjustment from time to
time to prevent dilution, among other circumstances, in the event
of a stock dividend on, or a subdivision, split, combination,
consolidation or reclassification of, the Serial Preferred or the
Common Stock, or a reverse split of the outstanding shares of
Serial Preferred or the Common Stock.
At any time after the acquisition by a person or group of
affiliated or associated persons of beneficial ownership of 15
percent or more of the outstanding Common Stock and prior to the
acquisition by such person or group of 50 percent or more of the
outstanding Common Stock, the Board of Directors may exchange the
Rights (other than Rights owned by such person or group, which
have become void), in whole or in part, at an exchange ratio of
one share of Common Stock per Right (subject to adjustment).
With certain exceptions, no adjustment in the Purchase Price
will be required until cumulative adjustments require an
adjustment of at least one percent in the Purchase Price. The
Company will not be required to issue fractional shares of Serial
Preferred or Common Stock (other than fractions in multiples of
one one-hundredths of a share of Serial Preferred) and, in lieu
thereof, an adjustment in cash may be made based on the market
price of the Serial Preferred or Common Stock on the last trading
date prior to the date of exercise.
At any time after the date of the Rights Plan until the time
that a person becomes an Acquiring Person, the Board of Directors
may redeem the Rights in whole, but not in part, at a price of
$.01 per Right ("Redemption Price"), which may (at the option of
the Company) be paid in cash, shares of Common Stock or other
consideration deemed appropriate by the Board of Directors. Upon
the effectiveness of any action of the Board of Directors
ordering redemption of the Rights, the Rights will terminate and
the only right of the holders of Rights will be to receive the
Redemption Price.
Issuance of Serial Preferred or Common Stock upon exercise
of the Rights will be subject to any necessary regulatory
approvals. Until a Right is exercised, the holder thereof, as
such, will have no rights as a shareholder of the Company,
including, without limitation, the right to vote or to receive
dividends. One million shares of Serial Preferred were reserved
for issuance in the event of exercise of the Rights.
The provisions of the Rights Plan may be amended by the
Company, except that any amendment adopted after the time that a
person becomes an Acquiring Person may not adversely affect the
interests of holders of Rights.
The Rights have certain anti-takeover effects. The Rights
will cause substantial dilution to a person or group that
attempts to acquire the Company without conditioning the offer on
the Rights being redeemed or a substantial number of Rights being
acquired, and under certain circumstances the Rights beneficially
owned by such a person or group may become void. The Rights
9
should not interfere with any merger or other business
combination approved by the Board of Directors because, if the
Rights would become exercisable as a result of such merger or
business combination, the Board of Directors may, at its option,
at any time prior to the time that any person becomes an
Acquiring Person, redeem all (but not less than all) of the then
outstanding Rights at the Redemption Price.
EXPERTS
The Company's consolidated financial statements incorporated
in this Prospectus by reference to the Company's 1997 Form 10-K
have been so incorporated in reliance on the report of Price
Waterhouse LLP, independent accountants, given on the authority
of said firm as experts in auditing and accounting.
The statements as to matters of law and legal conclusions
under "Description of Common Stock" and "Description of Preferred
Share Purchase Rights" in this Prospectus and in the Incorporated
Documents have been reviewed by Philip R. Halverson, Esq.,
Duluth, Minnesota, Vice President, General Counsel and Secretary
for Minnesota Power, and are set forth or incorporated herein by
reference in reliance upon his opinion given upon his authority
as an expert.
As of April 30, 1998 Mr. Halverson owned 7,056 shares
Minnesota Power Common Stock. Mr. Halverson is acquiring
additional shares of Minnesota Power Common Stock at regular
intervals as a participant in the Company's Employee Stock
Ownership Plan, Employee Stock Purchase Plan, Supplemental
Retirement Plan and Dividend Reinvestment and Stock Purchase
Plan. In addition, Mr. Halverson has options to purchase 7,558
shares of Minnesota Power Common Stock pursuant to the Company's
Executive Long-Term Incentive Compensation Plan.
LEGAL OPINIONS
The legality of the New Stock will be passed upon for the
Company by Mr. Halverson and by Reid & Priest LLP, New York, New
York, counsel for the Company, and for any underwriter, dealer or
agent by Morrison Cohen Singer & Weinstein, LLP. Reid & Priest
LLP and Morrison Cohen Singer & Weinstein, LLP may rely as to all
matters of Minnesota law upon the opinion of Mr. Halverson.
PLAN OF DISTRIBUTION
The Company may sell the New Stock in any of three ways: (i)
through underwriters or dealers; (ii) directly to a limited
number of institutional purchasers or to a single purchaser; or
(iii) through agents. The Prospectus Supplement relating to the
Offered Stock will set forth the terms of the offering of the
Offered Stock, including the name or names of any underwriters,
dealers or agents, the purchase price of the Offered Stock and
the net proceeds to the Company from such sale, any underwriting
discounts and other items constituting underwriters'
compensation, any initial public offering price and any discounts
or concessions allowed or reallowed or paid to dealers. Any
initial public offering price and any discounts or concessions
allowed or reallowed or paid to dealers may be changed from time
to time.
If underwriters are used in any sale of the New Stock, the
Offered Stock will be acquired by the underwriters for their own
account and may be resold from time to time in one or more
transactions, including negotiated transactions, at a fixed
public offering price or at varying prices determined at the time
of sale. The underwriter or underwriters with respect to a
particular underwritten offering of Offered Stock will be named
in the Prospectus Supplement relating to such offering and, if an
underwriting syndicate is used, the managing underwriter or
underwriters will be set forth on the cover page of such
Prospectus Supplement. Unless otherwise set forth in the
Prospectus Supplement, the obligations of the underwriter or
underwriters to purchase the Offered Stock will be subject to
certain conditions precedent and the underwriter or underwriters
will be obligated to purchase all the Offered Stock if any is
10
purchased except that, in certain cases involving a default by
one or more underwriters, less than all of the Offered Stock may
be purchased.
Offered Stock may be sold directly by the Company or through
agents designated by the Company from time to time. Any agent
involved in the offer or sale of the Offered Stock in respect of
which this Prospectus is delivered will be named, and any
commissions payable by the Company to such agent will be set
forth, in the Prospectus Supplement. Unless otherwise indicated
in the Prospectus Supplement, any such agent will be acting on a
best efforts basis for the period of its appointment.
If so indicated in the Prospectus Supplement, the Company
will authorize agents, underwriters or dealers to solicit offers
by certain specified institutions to purchase Offered Stock from
the Company at the public offering price to be set forth in the
Prospectus Supplement pursuant to delayed delivery contracts
providing for payment and delivery on a specified date in the
future. Such contracts will be subject to those conditions set
forth in the Prospectus Supplement, and the Prospectus Supplement
will set forth the commission payable for solicitation of such
contracts.
Subject to certain conditions, agents and underwriters may
be entitled under agreements entered into with the Company to
indemnification by the Company against certain civil liabilities,
including liabilities under the Securities Act of 1933, as
amended, arising out of or based upon, among other things, any
untrue statement or alleged untrue statement of a material fact
contained in the registration statement, this Prospectus, a
Prospectus Supplement or the Incorporated Documents or the
omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were
made, not misleading. See the Prospectus Supplement.
-----------------
11
=================================================================
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO
MAKE ANY REPRESENTATIONS IN CONNECTION WITH THIS OFFERING OTHER
THAN THOSE CONTAINED IN THIS PROSPECTUS OR ANY PROSPECTUS
SUPPLEMENT AND, IF GIVEN OR MADE, SUCH OTHER INFORMATION AND
REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED
BY THE COMPANY OR ANY UNDERWRITER. NEITHER THE DELIVERY OF THIS
PROSPECTUS OR ANY PROSPECTUS SUPPLEMENT NOR ANY SALE MADE HEREUN-
DER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT
THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE
DATE HEREOF OR THEREOF OR THAT THE INFORMATION CONTAINED HEREIN
OR THEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO ITS DATE.
THIS PROSPECTUS AND ANY PROSPECTUS SUPPLEMENT DO NOT CONSTITUTE
AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY
SECURITIES OTHER THAN THE REGISTERED SECURITIES TO WHICH THEY
RELATE. THIS PROSPECTUS AND ANY PROSPECTUS SUPPLEMENT DO NOT
CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY
SUCH SECURITIES IN ANY CIRCUMSTANCES IN WHICH SUCH OFFER OR
SOLICITATION IS UNLAWFUL.
---------------
TABLE OF CONTENTS
PAGE
----
Available Information . . . . . . . . . . . . . . . . . . . . 2
Incorporation of Certain Documents by Reference . . . . . . . 2
The Company . . . . . . . . . . . . . . . . . . . . . . . . . 3
Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . 5
Dividends and Price Range . . . . . . . . . . . . . . . . . . 6
Description of Common Stock . . . . . . . . . . . . . . . . . 6
Description of Preferred Share Purchase Rights . . . . . . . 7
Experts . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Legal Opinions . . . . . . . . . . . . . . . . . . . . . . . 10
Plan of Distribution . . . . . . . . . . . . . . . . . . . . 10
=================================================================
=================================================================
3,000,000 SHARES
MINNESOTA
POWER & LIGHT
COMPANY
COMMON STOCK
(WITHOUT PAR VALUE)
---------------
PROSPECTUS
---------------
, 199
--------- --- --
=================================================================
PART II. INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The expenses in connection with the issuance and distribution
of the securities being registered are:
Filing Fee - Securities and Exchange Commission $ 35,483
Stock exchange listing fee 10,937
Fees of Company's legal counsel* 100,000
Independent accountants' fees* 25,000
Printing, including Form S-3,
prospectus, exhibits, etc.* 75,000
Fees of transfer agent and registrar* 10,000
Miscellaneous expenses* 33,580
--------
Total* $290,000
========
------------
*Estimated
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 302A.521 of the Minnesota Business Corporation Act
generally provides for the indemnification of directors, officers
or employees of a corporation made or threatened to be made a
party to a proceeding by reason of the former or present official
capacity of the person against judgments, penalties and fines
(including attorneys' fees and disbursements) where such person,
among other things, has not been indemnified by another organiza-
tion, acted in good faith, received no improper personal benefit
and with respect to any criminal proceeding, had no reasonable
cause to believe his conduct was unlawful.
Section 13 of the Bylaws of the Company contains the following
provisions relative to indemnification of directors and officers:
"The Company shall reimburse or indemnify each present and
future director and officer of the Company (and his or her heirs,
executors and administrators) for or against all expenses reason-
ably incurred by such director or officer in connection with or
arising out of any action, suit or proceeding in which such
director or officer may be involved by reason of being or having
been a director or officer of the Company. Such indemnification
for reasonable expenses is to be to the fullest extent permitted
by the Minnesota Business Corporation Act, Minnesota Statutes
Chapter 302A. By affirmative vote of the Board of Directors or
with written approval of the Chairman and Chief Executive Offi-
cer, such indemnification may be extended to include agents and
employees who are not directors or officers of the Company, but
who would otherwise be indemnified for acts and omissions under
Chapter 302A of the Minnesota Business Corporation Act, if such
agent or employee were an officer of the Company."
"Reasonable expenses may include reimbursement of attorney's
fees and disbursements, including those incurred by a person in
connection with an appearance as a witness."
"Upon written request to the Company and approval by the
Chairman and Chief Executive Officer, an agent or employee for
whom indemnification has been extended, or an officer or director
may receive an advance for reasonable expenses if such agent,
employee, officer or director is made or threatened to be made a
party to a proceeding involving a matter for which indemnifica-
tion is believed to be available under Minnesota Statutes Chapter
302A."
"The foregoing rights shall not be exclusive of other rights
to which any director or officer may otherwise be entitled and
shall be available whether or not the director or officer contin-
ues to be a director or officer at the time of incurring such
expenses and liabilities."
II-1
The Company has insurance covering its expenditures which
might arise in connection with the lawful indemnification of its
directors and officers for their liabilities and expenses, and
insuring officers and directors of the Company against certain
other liabilities and expenses.
ITEM 16. EXHIBITS
EXHIBIT
NUMBER
------
1 - Form of Underwriting Agreement.
*4(a)1 - Articles of Incorporation, restated as of July 27,
1988 (filed as Exhibit 3(a), File No. 33-24936).
*4(a)2 - Certificate Fixing Terms of Serial Preferred Stock
A, $7.125 Series (filed as Exhibit 3(a)2, File No.
33-50143).
*4(a)3 - Certificate Fixing Terms of Serial Preferred Stock
A, $6.70 Series (filed as Exhibit 3(a)3, File No.
33-50143).
*4(b) - Bylaws as amended January 23, 1991 (filed as
Exhibit 3(b), File No. 33-45549).
*4(c)l - Mortgage and Deed of Trust, dated as of September
1, 1945, between the Company and Irving Trust
Company (now The Bank of New York) and Richard H.
West (W.T. Cunningham, successor), Trustees (filed
as Exhibit 7(c), File No. 2-5865).
*4(c)2 - Supplemental Indentures to Mortgage and Deed of
Trust:
NUMBER DATED AS OF REFERENCE FILE EXHIBIT
------ ----------- -------------- --------
First March 1, 1949 2-7826 7(b)
Second July 1, 1951 2-9036 7(c)
Third March 1, 1957 2-13075 2(c)
Fourth January 1, 1968 2-27794 2(c)
Fifth April 1, 1971 2-39537 2(c)
Sixth August 1, 1975 2-54116 2(c)
Seventh September 1, 19762-57014 2(c)
Eighth September 1, 19772-59690 2(c)
Ninth April 1, 1978 2-60866 2(c)
Tenth August 1, 1978 2-62852 2(d)2
Eleventh December 1, 1982 2-56649 4(a)3
Twelfth April 1, 1987 33-30224 4(a)3
Thirteenth March 1, 1992 33-47438 4(b)
Fourteenth June 1, 1992 33-55240 4(b)
Fifteenth July 1, 1992 33-55240 4(c)
Sixteenth July 1, 1992 33-55240 4(d)
Seventeenth February 1, 1993 33-50143 4(b)
Eighteenth July 1, 1993 33-50143 4(c)
Nineteenth February 1, 1997 1-3548
(1996 Form
10-K) 4(a)3
Twentieth November 1, 1997 1-3548
(1997 Form
10-K) 4(a)3
II-2
Exhibit
Number
------
*4(d) - Mortgage and Deed of Trust, dated as of March 1,
1943, between Superior Water, Light and Power
Company and Chemical Bank & Trust Company and Howard
B. Smith, as Trustees, both succeeded by First Bank
N.A., as Trustee (filed as Exhibit 7(c), File No. 2-
8668), as supplemented and modified by First
Supplemental Indenture thereto dated as of March 1,
1951 (filed as Exhibit 2(d)(1), File No. 2-59690),
Second Supplemental Indenture thereto dated as of
March 1, 1962 (filed as Exhibit 2(d)l, File No. 2-
27794), Third Supplemental Indenture thereto dated
July 1, 1976 (filed as Exhibit 2(e)l, File No. 2-
57478), Fourth Supplemental Indenture thereto dated
as of March 1, 1985 (filed as Exhibit 4(b), File No.
2-78641), Fifth Supplemental Indenture thereto dated
as of December 1, 1992 (filed as Exhibit 4(b)l to
Form 10-K for the year ended December 31, 1992, File
No. 1-3548), Sixth Supplemental Indenture, dated as
of March 24, 1994 (filed as Exhibit 4(b)l to Form
10-K for the year ended December 31, 1996, File No.
1-3548), Seventh Supplemental Indenture, dated as of
November 1, 1994 (filed as Exhibit 4(b)2 to Form 10-
K for the year ended December 31, 1996, File No. 1-
3548) and Eighth Supplemental Indenture, dated as of
January 1, 1997 (filed as Exhibit 4(b)3 to Form 10-K
for the year ended December 31, 1996, File No. 1-
3548).
*4(e) - Indenture, dated as of March 1, 1993, between
Southern States Utilities, Inc. (now Florida Water
Services Corporation) and Nationsbank of Georgia,
National Association (now SunTrust Bank, Central
Florida, N.A.), as Trustee (filed as Exhibit 4(d) to
Form 10-K for the year ended December 31, 1992, File
No. 1-3548), as supplemented and modified by First
Supplemental Indenture, dated as of March 1, 1993
(filed as Exhibit 4(c)l to Form 10-K for the year
ended December 31, 1996, File No. 1-3548), Second
Supplemental Indenture, dated as of March 31, 1997
(filed as Exhibit 4 to Form 10-Q for the quarter
ended March 31, 1997, File No. 1-3548) and Third
Supplemental Indenture, dated as of May 28, 1997
(filed as Exhibit 4 to Form 10-Q for the quarter
ended June 30, 1997, File No. 1-3548).
*4(f) - Amended and Restated Trust Agreement, dated as of
March 1, 1996, relating to MP&L Capital I's 8.05%
Cumulative Quarterly Income Preferred Securities,
between the Company, as Depositor, and The Bank of
New York, The Bank of New York (Delaware), Philip R.
Halverson, David G. Gartzke and James K. Vizanko, as
Trustees (filed as Exhibit 4(a) to Form 10-Q for the
quarter ended March 31, 1996, File No. 1-3548).
*4(g) - Amendment No. 1, dated April 11, 1996, to Amended
and Restated Trust Agreement, dated as of March 1,
1996, relating to MP&L Capital I's 8.05% Cumulative
Quarterly Income Preferred Securities (filed as
Exhibit 4(b) to Form 10-Q for the quarter ended
March 31, 1996, File No. 1-3548).
*4(h) - Indenture, dated as of March 1, 1996, relating to
the Company's 8.05% Junior Subordinated Debentures,
Series A, Due 2015, between the Company and The Bank
of New York, as Trustee (filed as Exhibit 4(c) to
Form 10-Q for the quarter ended March 31, 1996, File
No. 1-3548).
*4(i) - Guarantee Agreement, dated as of March 1, 1996,
relating to MP&L Capital I's 8.05% Cumulative
Quarterly Income Preferred Securities, between the
Company, as Guarantor, and The Bank of New York, as
Trustee (filed as Exhibit 4(d) to Form 10-Q for the
quarter ended March 31, 1996, File No. 1-3548).
*4(j) - Agreement as to Expenses and Liabilities, dated as
of March 20, 1996, relating to MP&L Capital I's
8.05% Cumulative Quarterly Income Preferred
II-3
Securities, between the Company and MP&L Capital I
(filed as Exhibit 4(e) to Form 10-Q for the quarter
ended March 31, 1996, File No. 1-3548).
*4(k) - Officer's Certificate, dated March 20, 1996, estab-
lishing the terms of the 8.05% Junior Subordinated
Debentures, Series A, Due 2015 issued in connection
with the 8.05% Cumulative Quarterly Income Preferred
Securities of MP&L Capital I (filed as Exhibit 4(i)
to Form 10-K for the year ended December 31, 1996,
File No. 1-3548).
*4(l) - Rights Agreement dated as of July 24, 1996, between
Minnesota Power & Light Company and the Corporate
Secretary of Minnesota Power & Light Company, as
Rights Agent (filed as Exhibit 4 to Form 8-K dated
August 2, 1996, File No. 1-3548).
*4(m) - Indenture, dated as of May 15, 1996, relating to the
ADESA Corporation's 7.70% Senior Notes, Series A,
Due 2006, between ADESA Corporation and The Bank of
New York, as Trustee (filed as Exhibit 4(k) to Form
10-K for the year ended December 31, 1996, File No.
1-3548).
*4(n) - Guarantee of Minnesota Power & Light Company, dated
as of May 30, 1996, relating to the ADESA
Corporation's 7.70% Senior Notes, Series A, Due 2006
(filed as Exhibit 4(i) to Form 10-K for the year
ended December 31, 1996, File No. 1-3548).
*4(o) - ADESA Corporation Officer's Certificate 1-D-1, dated
May 30, 1996, relating to the ADESA Corporation's
7.70% Senior Notes, Series A, Due 2006 (filed as Ex-
hibit 4(m) to Form 10-K for the year ended December
31, 1996, File No. 1-3548).
5(a) - Opinion and Consent of Philip R. Halverson, Esq.,
Vice President, General Counsel and Secretary of the
Company.
5(b) - Opinion and Consent of Reid & Priest LLP.
23(a) - Consent of Price Waterhouse LLP.
23(b) - Consents of Philip R. Halverson, Esq., and Reid &
Priest LLP are contained in Exhibits 5(a) and 5(b),
respectively.
24 - Power of Attorney (see page II-7).
---------------
*Incorporated herein by reference as indicated.
II-4
ITEM 17. UNDERTAKINGS.
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this regis-
tration statement:
(i) To include any prospectus required by
section 10(a)(3) of the Securities Act
of 1933;
(ii) To reflect in the prospectus any facts
or events arising after the effective
date of the registration statement (or
the most recent post-effective amend-
ment thereof) which, individually or in
the aggregate, represent a fundamental
change in the information set forth in
the registration statement. Notwith-
standing the foregoing, any increase or
decrease in volume of securities of-
fered (if the total dollar value of
securities offered would not exceed
that which was registered) and any de-
viation from the low or high end of the
estimated maximum offering range may be
reflected in the form of prospectus
filed with the Commission pursuant to
Rule 424(b) if, in the aggregate, the
changes in volume and price represent
no more than a 20 percent change in
maximum aggregate offering price set
forth in the "Calculation of Registra-
tion Fee" table in the effective regis-
tration statement;
(iii) To include any material information
with respect to the plan of distribu-
tion not previously disclosed in the
registration statement or any material
change to such information in the reg-
istration statement.
Provided, however, that paragraphs (i) and (ii) do not
apply if the registration statement is on Form S-3 or Form
S-8 and the information required to be included in a post-
effective amendment by those paragraphs is contained in
periodic reports filed with or furnished to the Commission
by the registrant pursuant to section 13 or section 15(d)
of the Securities Exchange Act of 1934 that are incorporat-
ed by reference in the registration statement.
(2) That, for the purpose of determining any liability
under the Securities Act of 1933, each such post-effective
amendment shall be deemed to be a new registration state-
ment relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to
be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effec-
tive amendment any of the securities being registered
which remain unsold at the termination of the offering.
(4) That, for purposes of determining any liability under
the Securities Act of 1933, each filing of the registr-
ant's annual report pursuant to section 13(a) or sec-
tion 15(d) of the Securities Exchange Act of 1934 that
is incorporated by reference in the registration state-
ment shall be deemed to be a new registration statement
relating to the securities offered therein, and the
offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
(5) Insofar as indemnification for liabilities arising
under the Securities Act of 1933 may be permitted to
directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or
otherwise, the registrant has been advised that in the
opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such
liabilities (other than the payment by the registrant
of expenses incurred or paid by a director, officer or
controlling person of the registrant in the successful
defense of any action, suit or proceeding) is asserted
by such director, officer or controlling person in
connection with the securities being registered, the
II-5
registrant will, unless in the opinion of its counsel
the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the ques-
tion whether such indemnification by it is against
public policy as expressed in the Act and will be gov-
erned by the final adjudication of such issue.
Ii-6
POWER OF ATTORNEY
Each person whose signature appears below hereby authorizes
any agent for service named in this registration statement to
execute in the name of each such person, and to file with the
Securities and Exchange Commission, any and all amendments,
including post-effective amendments, to the registration state-
ment, and appoints any such agent for service as attorney-in-fact
to sign in each such person's behalf individually and in each
capacity stated below and file any such amendments to the regis-
tration statement and the registrant hereby also appoints each
such agent for service as its attorney-in-fact with like authori-
ty to sign and file any such amendments in its name and behalf.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
the registrant certifies that it has reasonable grounds to
believe that it meets all of the requirements for filing on Form
S-3 and has duly caused this registration statement to be signed
on its behalf by the undersigned, thereunto duly authorized, in
the City of Duluth, State of Minnesota, on May 8, 1998.
MINNESOTA POWER & LIGHT COMPANY
(Registrant)
By /s/ Edwin L. Russell
--------------------------------
Edwin L. Russell
Chairman, President and
Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933,
this registration statement has been signed by the following
persons in the capacities and on the dates indicated.
SIGNATURE TITLE DATE
--------- ----- ----
/s/ Edwin L. Russell Chairman, President, May 8, 1998
------------------------- Chief Executive Officer
Edwin L. Russell and Director
Chairman, President,
Chief Executive Officer
and Director
/s/ D. G. Gartzke Senior Vice President- May 8, 1998
------------------------- Finance and
D. G. Gartzke Chief Financial Officer
Senior Vice President
-Finance
and Chief Financial
Officer
/s/ Mark A. Schober Controller May 8, 1998
-------------------------
Mark A. Schober
Controller
II-7
SIGNATURE TITLE DATE
--------- ----- ----
/s/ Kathleen A. Brekken Director May 8, 1998
---------------------------
Kathleen A. Brekken
/s/ Merrill K. Cragun Director May 8, 1998
---------------------------
Merrill K. Cragun
/s/ Dennis E. Evans Director May 8, 1998
---------------------------
Dennis E. Evans
/s/ Peter J. Johnson Director May 8, 1998
---------------------------
Peter J. Johnson
/s/ George L. Mayer Director May 8, 1998
---------------------------
George L. Mayer
/s/ Paula F. McQueen Director May 8, 1998
---------------------------
Paula F. McQueen
/s/ Robert S. Nickoloff Director May 8, 1998
---------------------------
Robert S. Nickoloff
/s/ Jack I. Rajala Director May 8, 1998
---------------------------
Jack I. Rajala
/s/ Arend J. Sandbulte Director May 8, 1998
---------------------------
Arend J. Sandbulte
/s/ Nick Smith Director May 8, 1998
---------------------------
Nick Smith
/s/ Bruce W. Stender Director May 8, 1998
---------------------------
Bruce W. Stender
/s/ Donald C. Wegmiller Director May 8, 1998
---------------------------
Donald C. Wegmiller
II-8
EXHIBIT INDEX
Exhibit Description
------- -----------
1 - Form of Underwriting Agreement.
*4(a)1 - Articles of Incorporation, restated as of July 27,
1988 (filed as Exhibit 3(a), File No. 33-24936).
*4(a)2 - Certificate Fixing Terms of Serial Preferred Stock
A, $7.125 Series (filed as Exhibit 3(a)2, File No.
33-50143).
*4(a)3 - Certificate Fixing Terms of Serial Preferred Stock
A, $6.70 Series (filed as Exhibit 3(a)3, File No.
33-50143).
*4(b) - Bylaws as amended January 23, 1991 (filed as
Exhibit 3(b), File No. 33-45549).
*4(c)l - Mortgage and Deed of Trust, dated as of September
1, 1945, between the Company and Irving Trust
Company (now The Bank of New York) and Richard H.
West (W.T. Cunningham, successor), Trustees (filed
as Exhibit 7(c), File No. 2-5865).
*4(c)2 - Supplemental Indentures to Mortgage and Deed of
Trust:
NUMBER DATED AS OF REFERENCE FILE EXHIBIT
------ ----------- -------------- --------
First March 1, 1949 2-7826 7(b)
Second July 1, 1951 2-9036 7(c)
Third March 1, 1957 2-13075 2(c)
Fourth January 1, 1968 2-27794 2(c)
Fifth April 1, 1971 2-39537 2(c)
Sixth August 1, 1975 2-54116 2(c)
Seventh September 1, 19762-57014 2(c)
Eighth September 1, 19772-59690 2(c)
Ninth April 1, 1978 2-60866 2(c)
Tenth August 1, 1978 2-62852 2(d)2
Eleventh December 1, 1982 2-56649 4(a)3
Twelfth April 1, 1987 33-30224 4(a)3
Thirteenth March 1, 1992 33-47438 4(b)
Fourteenth June 1, 1992 33-55240 4(b)
Fifteenth July 1, 1992 33-55240 4(c)
Sixteenth July 1, 1992 33-55240 4(d)
Seventeenth February 1, 1993 33-50143 4(b)
Eighteenth July 1, 1993 33-50143 4(c)
Nineteenth February 1, 1997 1-3548
(1996 Form
10-K) 4(a)3
Twentieth November 1, 1997 1-3548
(1997 Form
10-K) 4(a)3
*4(d) - Mortgage and Deed of Trust, dated as of March 1,
1943, between Superior Water, Light and Power
Company and Chemical Bank & Trust Company and Howard
B. Smith, as Trustees, both succeeded by First Bank
N.A., as Trustee (filed as Exhibit 7(c), File No. 2-
8668), as supplemented and modified by First
Supplemental Indenture thereto dated as of March 1,
1951 (filed as Exhibit 2(d)(1), File No. 2-59690),
Second Supplemental Indenture thereto dated as of
March 1, 1962 (filed as Exhibit 2(d)l, File No. 2-
27794), Third Supplemental Indenture thereto dated
July 1, 1976 (filed as Exhibit 2(e)l, File No. 2-
57478), Fourth Supplemental Indenture thereto dated
as of March 1, 1985 (filed as Exhibit 4(b), File No.
2-78641), Fifth Supplemental Indenture thereto dated
as of December 1, 1992 (filed as Exhibit 4(b)l to
Form 10-K for the year ended December 31, 1992, File
No. 1-3548), Sixth Supplemental Indenture, dated as
of March 24, 1994 (filed as Exhibit 4(b)l to Form
10-K for the year ended December 31, 1996, File No.
1-3548), Seventh Supplemental Indenture, dated as of
November 1, 1994 (filed as Exhibit 4(b)2 to Form 10-
K for the year ended December 31, 1996, File No. 1-
3548) and Eighth Supplemental Indenture, dated as of
January 1, 1997 (filed as Exhibit 4(b)3 to Form 10-K
for the year ended December 31, 1996, File No. 1-
3548).
*4(e) - Indenture, dated as of March 1, 1993, between
Southern States Utilities, Inc. (now Florida Water
Services Corporation) and Nationsbank of Georgia,
National Association (now SunTrust Bank, Central
Florida, N.A.), as Trustee (filed as Exhibit 4(d) to
Form 10-K for the year ended December 31, 1992, File
No. 1-3548), as supplemented and modified by First
Supplemental Indenture, dated as of March 1, 1993
(filed as Exhibit 4(c)l to Form 10-K for the year
ended December 31, 1996, File No. 1-3548), Second
Supplemental Indenture, dated as of March 31, 1997
(filed as Exhibit 4 to Form 10-Q for the quarter
ended March 31, 1997, File No. 1-3548) and Third
Supplemental Indenture, dated as of May 28, 1997
(filed as Exhibit 4 to Form 10-Q for the quarter
ended June 30, 1997, File No. 1-3548).
*4(f) - Amended and Restated Trust Agreement, dated as of
March 1, 1996, relating to MP&L Capital I's 8.05%
Cumulative Quarterly Income Preferred Securities,
between the Company, as Depositor, and The Bank of
New York, The Bank of New York (Delaware), Philip R.
Halverson, David G. Gartzke and James K. Vizanko, as
Trustees (filed as Exhibit 4(a) to Form 10-Q for the
quarter ended March 31, 1996, File No. 1-3548).
*4(g) - Amendment No. 1, dated April 11, 1996, to Amended
and Restated Trust Agreement, dated as of March 1,
1996, relating to MP&L Capital I's 8.05% Cumulative
Quarterly Income Preferred Securities (filed as
Exhibit 4(b) to Form 10-Q for the quarter ended
March 31, 1996, File No. 1-3548).
*4(h) - Indenture, dated as of March 1, 1996, relating to
the Company's 8.05% Junior Subordinated Debentures,
Series A, Due 2015, between the Company and The Bank
of New York, as Trustee (filed as Exhibit 4(c) to
Form 10-Q for the quarter ended March 31, 1996, File
No. 1-3548).
*4(i) - Guarantee Agreement, dated as of March 1, 1996,
relating to MP&L Capital I's 8.05% Cumulative
Quarterly Income Preferred Securities, between the
Company, as Guarantor, and The Bank of New York, as
Trustee (filed as Exhibit 4(d) to Form 10-Q for the
quarter ended March 31, 1996, File No. 1-3548).
*4(j) - Agreement as to Expenses and Liabilities, dated as
of March 20, 1996, relating to MP&L Capital I's
8.05% Cumulative Quarterly Income Preferred
Securities, between the Company and MP&L Capital I
(filed as Exhibit 4(e) to Form 10-Q for the quarter
ended March 31, 1996, File No. 1-3548).
*4(k) - Officer's Certificate, dated March 20, 1996, estab-
lishing the terms of the 8.05% Junior Subordinated
Debentures, Series A, Due 2015 issued in connection
with the 8.05% Cumulative Quarterly Income Preferred
Securities of MP&L Capital I (filed as Exhibit 4(i)
to Form 10-K for the year ended December 31, 1996,
File No. 1-3548).
*4(l) - Rights Agreement dated as of July 24, 1996, between
Minnesota Power & Light Company and the Corporate
Secretary of Minnesota Power & Light Company, as
Rights Agent (filed as Exhibit 4 to Form 8-K dated
August 2, 1996, File No. 1-3548).
*4(m) - Indenture, dated as of May 15, 1996, relating to the
ADESA Corporation's 7.70% Senior Notes, Series A,
Due 2006, between ADESA Corporation and The Bank of
New York, as Trustee (filed as Exhibit 4(k) to Form
10-K for the year ended December 31, 1996, File No.
1-3548).
*4(n) - Guarantee of Minnesota Power & Light Company, dated
as of May 30, 1996, relating to the ADESA
Corporation's 7.70% Senior Notes, Series A, Due 2006
(filed as Exhibit 4(i) to Form 10-K for the year
ended December 31, 1996, File No. 1-3548).
*4(o) - ADESA Corporation Officer's Certificate 1-D-1, dated
May 30, 1996, relating to the ADESA Corporation's
7.70% Senior Notes, Series A, Due 2006 (filed as Ex-
hibit 4(m) to Form 10-K for the year ended December
31, 1996, File No. 1-3548).
5(a) - Opinion and Consent of Philip R. Halverson, Esq.,
Vice President, General Counsel and Secretary of the
Company.
5(b) - Opinion and Consent of Reid & Priest LLP.
23(a) - Consent of Price Waterhouse LLP.
23(b) - Consents of Philip R. Halverson, Esq., and Reid &
Priest LLP are contained in Exhibits 5(a) and 5(b),
respectively.
24 - Power of Attorney (see page II-7).
---------------
*Incorporated herein by reference as indicated.
EXHIBIT 1
[ ] SHARES
---------------
MINNESOTA POWER & LIGHT COMPANY
COMMON STOCK
UNDERWRITING AGREEMENT
[ , 199 ]
----------- -
New York, New York
[ ]
--------------------
[ ]
--------------------
[ ]
--------------------
[ ]
--------------------
[ ]
--------------------
[ ]
--------------------
[ ]
--------------------
[ ]
--------------------
[ ]
--------------------
Dear Sirs:
Minnesota Power & Light Company (the "Company") proposes to
issue and sell to you (each, an "Underwriter" and, collectively,
the "Underwriters") an aggregate of [ ] shares of the
-----------
Company's Common Stock, without par value (the "Common Stock"),
and the preferred share purchase rights attached thereto (the
"Rights") (collectively referred to as "Firm Shares") . The
Company has also agreed to grant to the Underwriters an option
(the "Option") to purchase up to an additional [ ]
----------------
shares of Common Stock and the attached Rights (collectively
referred to as the "Option Shares") on the terms and for the
purposes set forth in Section 1(b). The Firm Shares and the
Option Shares are collectively referred to as the "Shares."
The initial public offering price per share for the Shares
and the purchase price per share for the Shares to be paid by the
several Underwriters shall be agreed upon by the Company and the
Underwriters, and such agreement shall be set forth in a separate
written instrument substantially in the form of Annex A hereto
(the "Price Determination Agreement"). The Price Determination
Agreement may take the form of an exchange of any standard form
of written telecommunication among the Company and the
Underwriters and shall specify such applicable information as is
indicated in Annex A hereto. The offering of the Shares shall be
governed by this Agreement, as supplemented by the Price
Determination Agreement. From and after the date of the
execution and delivery of the Price Determination Agreement, this
Agreement shall be deemed to incorporate, and, unless the context
otherwise indicates, all references contained herein to "this
Agreement" and the phrase "herein" shall be deemed to include the
Price Determination Agreement.
The Company confirms as follows its agreements with the
several Underwriters.
1. Agreement to Sell and Purchase.
------------------------------
(a) The Company agrees to issue and sell to each
Underwriter, and each Underwriter, severally and not jointly,
agrees to purchase from the Company at the purchase price per
share for the Firm Shares to be agreed upon by the Underwriters
and the Company and set forth in the Price Determination
Agreement, the number of Firm Shares set forth opposite the name
of such Underwriter in Schedule 1 thereto, plus such additional
number of Firm Shares such Underwriter may become obligated to
purchase pursuant to Section 10 hereof. The obligations of the
Underwriters under this Agreement are several and not joint. The
obligations of the Company and the Underwriters under this
Agreement are undertaken on the basis of the representations and
are subject to the conditions of this Agreement.
(b) Subject to all the terms and conditions in this
Agreement, the Company grants the Option to the Underwriters,
severally and not jointly, to purchase up to [ ]
----------------
Option Shares from the Company at the same price per share as the
Underwriters shall pay for the Firm Shares. The Option may be
exercised only to cover over-allotments in the sale of the Firm
Shares by the several Underwriters and may be exercised in whole
or in part at any time (but not more than once), upon written or
telegraphic notice (the "Option Share Notice") by the
Underwriters to the Company on or before the 30th day after the
date of this Agreement setting forth the aggregate number of
Option Shares to be purchased and the time and date for such
purchase (the "Option Closing Date"), which Option Closing Date
may be the same as the Closing Date (as defined in Section 2) but
in no event shall the Option Closing Date be earlier than the
Closing Date nor later than five business days after the giving
of the Option Shares Notice. On the Option Closing Date, the
Company shall issue and sell to the several Underwriters the
number of Option Shares set forth in the Option Shares Notice,
and each Underwriter shall purchase such percentage of the Option
Shares as is equal to the percentage of Firm Shares that such
Underwriter is purchasing, as adjusted by the Underwriters in
such manner as they deem advisable to avoid fractional shares.
(c) The initial public offering price per share for
the Firm Shares and the purchase price per share for the Firm
Shares to be paid by the several Underwriters shall be agreed
upon and set forth in the Price Determination Agreement, which
shall be dated the date hereof.
2. Payment and Delivery. Delivery of the Firm Shares
--------------------
shall be made to the Underwriters in New York, New York, against
payment of the purchase price by wire transfer of immediately
available funds to an account designated in writing by the
Company to the Underwriters at least one business day prior to
the Closing Date (as hereinafter defined). Such payment shall be
made at 10:00 a.m., New York City time, on [ , 199 ] or
---------- -
at such time on such other date as may be agreed upon by the
Company and the Underwriters (such date is hereinafter referred
to as the "Closing Date").
To the extent that the Option is exercised, delivery of
the Option Shares against payment by the Underwriters (in the
manner specified above) shall take place in the manner specified
above for the Closing Date at the time and date (which may be the
Closing Date) specified in the Option Shares Notice.
Certificates evidencing the Shares shall be in
definitive form and shall be registered in such names and in such
denominations as the Underwriters shall request in writing at
least three business days prior to the Closing Date or the Option
Closing Date, as the case may be. If no such request is received
by said time, the Company shall have the right to deliver the
Shares in the name of the Underwriters in such denominations as
the Company may determine. For the purpose of expediting the
checking and packaging of certificates for the Shares, the
Company agrees to make such certificates available for inspection
at least one full business day prior to the Closing Date or the
Option Closing Date, as the case may be.
3. Registration Statement and Prospectus; Public
---------------------------------------------
Offering. The Company has filed with the Securities and
---------
Exchange Commission (the "Commission"), pursuant to provisions of
the Securities Act of 1933 (the "Act") and the published rules
and regulations adopted by the Commission thereunder (the "Rules
and Regulations"), a registration statement (No. 333- ) on
-----
Form S-3, relating to the registration of 3,000,000 shares of the
Company's Common Stock, without par value. Such registration
statement was declared effective on [ , 199 ]. The term
---------- -
"preliminary prospectus" as used herein means any preliminary
prospectus as contemplated by Rule 430 of the Rules and
Regulations included at any time as a part of such registration
statement. Copies of such registration statement and any
amendments thereto and of each preliminary prospectus included as
part of such registration statement have been delivered to the
Underwriters. Such registration statement, as it may be amended
to the date of this Agreement, including financial statements and
all exhibits, and the prospectus, as supplemented by a prospectus
supplement relating to the Shares proposed to be filed
electronically pursuant to Rule 424 are hereinafter respectively
referred to as the "Registration Statement" and the "Prospectus."
Any reference herein to the Registration Statement, any
preliminary prospectus or the Prospectus shall be deemed to refer
to and include the documents incorporated by reference therein
pursuant to Item 12 of Form S-3 of the Act (the "Incorporated
Documents") which were filed under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), on or before the Effective
Date or the date of such preliminary prospectus or the
Prospectus, as the case may be. Any reference herein to the terms
"amend," "amendment" or "supplement" with respect to the
Registration Statement, any preliminary prospectus or the
Prospectus shall be deemed to refer to and include the filing of
any document under the Exchange Act after the Effective Date, or
the date of any preliminary prospectus or the Prospectus, as the
case may be, and incorporated in such document by reference if
such filing is made prior to the Closing Date. Any reference
herein to the term "Effective Date" shall be deemed to refer to
the later of the time and date the Registration Statement was
declared effective or the time and date of the filing of the
Company's most recent Annual Report on Form 10-K if such filing
is made prior to the Closing Date.
The Company understands that the Underwriters propose
to make a public offering of the Firm Shares, as described in the
Prospectus, as soon after the date of the Price Determination
Agreement as the Underwriters deem advisable. The Company
confirms that the Underwriters and dealers have been authorized
to distribute each preliminary prospectus, if any, and are
authorized to distribute the Prospectus and any amendments or
supplements to it.
4. Representations of the Company. The Company
------------------------------
represents to the Under-writers as follows:
(a) The Company meets the requirements for use of
Form S-3 under the Act.
(b) On the Effective Date, and at the Closing
Date, the Registration Statement and, at the date of the filing
of the Prospectus, and at the Closing Date, and, if later, the
Option Closing Date, the Prospectus, as each may be amended or
supplemented, fully complied or will fully comply in all material
respects with the applicable provisions of the Act and the Rules
and Regulations, or pursuant to the Rules and Regulations shall
be deemed to comply therewith. On the Effective Date and Closing
Date and, if later, the Option Closing Date, the Registration
Statement, as it may be amended or supplemented, did not or will
not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary
to make the statements therein not misleading. On the date of
filing of the Prospectus and the Closing Date, and, if later, the
Option Closing Date, the Prospectus, as it may be amended or
supplemented, will not contain an untrue statement of a material
fact or omit to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under
which they were made, not misleading. On the date of filing of
the Prospectus and the Closing Date, and, if later, the Option
Closing Date, the Incorporated Documents did or will fully comply
in all material respects with the applicable provisions of the
Exchange Act and the rules and regulations of the Commission
thereunder (the "Exchange Act Rules and Regulations"), and, when
read together with the Prospectus, as it may be amended or
supplemented, will not contain an untrue statement of a material
fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not
misleading. The foregoing representations do not apply to
statements or omissions made in reliance on and in conformity
with information relating to any Underwriter furnished in writing
to the Company by such Underwriter expressly for use in the
Registration Statement or the Prospectus, as they may be amended
or supplemented.
(c) Since the respective dates as of which
information is given in the Registration Statement and the
Prospectus, as they may be amended or supplemented, there has not
been any material adverse change in the management, business,
properties, financial condition or results of operations of the
Company and its subsidiaries taken as a whole, and there has not
been any material transaction entered into by the Company or its
subsidiaries, other than transactions in the ordinary course of
business and transactions set forth in or contemplated by the
Registration Statement and the Prospectus, as they may be amended
or supplemented. The Company and its subsidiaries have no
material contingent obligation which is not disclosed in the
Registration Statement and the Prospectus, as they may be amended
or supplemented.
(d) Any Incorporated Documents filed and incorpo-
rated by reference prior to the Closing Date will, when they are
filed with the Commission, conform in all material respects with
the requirements of the Exchange Act and the Exchange Act Rules
and Regulations.
(e) The Company has full corporate power and
authority to enter into this Agreement. This Agreement has been
duly authorized, executed and delivered by the Company and is a
valid and binding agreement of the Company enforceable against it
in accordance with its terms.
(f) The consummation of the transactions contem-
plated by this Agreement and the fulfillment of its terms will
not result in a breach of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of
trust, or other material agreement or instrument to which the
Company is now a party.
(g) The outstanding shares of Common Stock have
been, and the Shares to be issued and sold by the Company upon
such issuance will be, duly authorized, validly issued, fully
paid and nonassessable and will not be subject to any preemptive
or similar right; and the Rights will be validly issued.
(h) The description of the Common Stock in the
Registration Statement and the Prospectus, as they may be amended
or supplemented, is, and at the Closing Date and, if later, the
Option Closing Date, will be, complete and accurate in all
material respects. Except for shares issuable under the
Company's Automatic Dividend Reinvestment and Stock Purchase
Plan, the Minnesota Power and Affiliated Companies Employee Stock
Purchase Plan or any compensation plan disclosed in the Company's
Proxy Statement with respect to the Company's [ ] Annual
-----
Meeting of Shareholders (collectively referred to as the "Stock
Purchase and Compensation Plans"), the Company does not have
outstanding, and at the Closing Date and, if later, the Option
Closing Date, will not have outstanding, any options to purchase,
or any rights or warrants to subscribe for, or any securities or
obligations convertible into, or any contracts or commitments to
issue or sell, any shares of Common Stock, any shares of capital
stock of any subsidiary or any such warrants, convertible
securities or obligations.
(i) The Company has filed a Petition for Certif-
ication of Capital Structure with the Minnesota Public Utilities
Commission ("Minnesota Commission") pursuant to the Minnesota
Public Utilities Act with respect to the issuance and sale by the
Company of the Shares. The Minnesota Commission has entered an
authorizing order approving the capital structure including the
issuance and sale of the Shares. Apart from such authorizing
order of the Minnesota Commission, no consent, approval, authori-
zation or order of, or any filing or declaration with, any court
or governmental agency or body is required for the consummation
by the Company of the transactions on its part herein contem-
plated, except such as have been obtained under the Act or the
Rules and Regulations and such as may be required under state
securities or "Blue Sky" laws or the by-laws and rules of the
National Association of Securities Dealers, Inc. (the "NASD") in
connection with the purchase and distribution by the Underwriters
of the Shares.
(j) The Company is duly registered as a transfer
agent within the meaning of the Exchange Act with respect to the
Common Stock and is in compliance with the Exchange Act Rules and
Regulations with respect to its activities as transfer agent.
(k) Neither the Company nor any of its directors,
officers or controlling persons has taken, directly or
indirectly, any action intended, or which might reasonably be
expected, to cause or result, under the Act or otherwise, in, or
which has constituted, stabilization or manipulation of the price
of any security of the Company to facilitate the sale or resale
of the Shares.
(l) No holder of securities of the Company has
rights to the registration of any securities of the Company
because of the filing of the Registration Statement.
5. Agreements of the Company.
-------------------------
(a) The Company will not file any amendment
or supplement to the Registration Statement or the Prospectus
unless a copy has first been submitted to the Underwriters a
reasonable time before its filing and the Underwriters have not
reasonably objected to it in writing within a reasonable time
after receiving the copy.
(b) The Company will promptly advise the
Underwriters (i) of the initiation or threatening of any proceed-
ings for, or receipt by the Company of any notice with respect
to, the suspension of the qualification of the Shares for sale in
any jurisdiction or the issuance of any order by the Commission
suspending the effectiveness of the Registration Statement and
(ii) of receipt by the Company or any representative or attorney
of the Company of any other communication from the Commission
relating to the Company, the Registration Statement, any prelimi-
nary prospectus or the Prospectus or to the transactions contem-
plated by this Agreement. The Company will make every reasonable
effort to prevent the issuance of an order suspending the effec-
tiveness of the Registration Statement and, if any such order is
issued, to obtain its lifting as soon as possible.
(c) The Company will furnish to the Underwriters
without charge one signed copy of the Registration Statement and
of any amendments thereto (including all exhibits filed with any
such document) and as many conformed copies of the Registration
Statement as each of the Underwriters may reasonably request.
(d) During such period as a prospectus is re-
quired by law to be delivered by the Underwriters or a dealer,
the Company will deliver, without charge, to the Underwriters and
to dealers, at such office or offices as the Underwriters may
designate, as many copies of the Prospectus as each of the
Underwriters may reasonably request, and, during such period (not
exceeding nine months) after the Effective Date if any event
occurs as a result of which it is necessary to amend or supple-
ment the Prospectus in order to make the statements in it, in the
light of the circumstances existing when the Prospectus is
delivered to a purchaser, not misleading in any material respect,
or if during such period it is necessary to amend or supplement
the Prospectus to comply with the Act or Rules and Regulations,
the Company will promptly prepare, submit to the Underwriters,
file, subject to Section 5(a),with the Commission and deliver,
without charge, to each of the Underwriters and to dealers (whose
names and addresses the Underwriters will furnish to the Company)
to whom Shares may have been sold by the Underwriters, and to
other dealers on request, amendments or supplements to the
Prospectus so that the statements in the Prospectus, as so
amended or supplemented, will not, in the light of the
circumstances existing when the Prospectus is delivered to a
purchaser, be misleading in any material respect and will comply
with the Act and the Rules and Regulations; provided, however,
that should such event relate solely to the activities of any of
the Underwriters, then such Underwriter will assume the expense
of preparing and furnishing any such amendment or supplement. In
case the Underwriters are required to deliver a Prospectus after
the expiration of nine months from the Effective Date, the
Company, upon the request of any of the Underwriters, will
furnish to such Underwriter, at the expense of such Underwriter,
a reasonable quantity of an amendment or supplement complying
with Section 10(a) of the Act. Delivery by the Underwriters of
any such amendments or supplements to the Prospectus will not
constitute a waiver of any of the conditions in Section 6.
(e) The Company will make generally available to
the Company's security holders, as soon as practicable but in no
event later than the last day of the 15th full calendar month
following the calendar quarter in which the Effective Date falls,
an earnings statement satisfying the provisions of Section 11(a)
of the Act and Rule 158 of the Rules and Regulations.
(f) The Company will take such actions as the
Underwriters reasonably designate in order to qualify the Shares
for offer and sale under the securities or "Blue Sky" laws of
such jurisdictions as the Underwriters reasonably designate.
(g) The Company will pay, or reimburse if paid by
the Underwriters, whether or not the transactions contemplated by
this Agreement are consummated or this Agreement is terminated,
all costs and expenses incident to the performance of the obliga-
tions of the Company under this Agreement, including costs and
expenses relating to (i) the preparation, printing and filing of
the Registration Statement and exhibits thereto, each preliminary
prospectus, the Prospectus, all amendments and supplements to the
Registration Statement and the Prospectus, except as provided in
Section 5(d), (ii) the preparation and delivery of certificates
representing the Shares, (iii) the registration or qualification
of the Shares for offer and sale under the securities or "Blue
Sky" laws of the jurisdictions referred to in Section 5(f) and
the determination of the legality of the Shares for investment,
including the reasonable fees and disbursements of counsel for
the Underwriters (not to exceed $10,000) in that connection, and
the preparation and printing of preliminary and supplemental
"Blue Sky" memoranda and legal investment memoranda, (iv) except
as provided in Section 5(d), the furnishing (including costs of
shipping and mailing) to the Underwriters and to dealers of
copies of the Registration Statement, each preliminary prospec-
tus, the Prospectus, and all amendments or supplements to the
Prospectus, and of the other documents required by this Section 5
to be so furnished, (v) all transfer taxes, if any, with respect
to the sale and delivery of the Shares by the Company to the
Underwriters, (vi) the listing of the Shares on the New York
Stock Exchange, (vii) any filings required to be made by the
Underwriters with the NASD, including the reasonable fees and
disbursements of counsel for the Underwriters in that connection,
and (viii) the transfer agent for the Shares.
(h) During the period of two years commencing on
the Effective Date, the Company will furnish to each Underwriter
who may so request copies of such financial statements and other
periodic and special reports as the Company may from time to time
distribute generally to the holders of any class of its capital
stock, and will furnish to each Underwriter who may so request a
copy of each annual or other report it will be required to file
with the Commission.
(i) The Company will not at any time, directly or
indirectly, take any action intended, or which might reasonably
be expected, to cause or result in, or which will constitute,
stabilization of the price of the shares of Common Stock to
facilitate the sale or resale of any of the Shares.
(j) Unless otherwise agreed to in writing by the
Company and the Underwriters, the Company will not for a period
of [ ] days after the commencement of public offering of the
--
Shares sell or otherwise dispose of any shares of Common Stock,
rights to acquire shares of Common Stock or securities
convertible into shares of Common Stock other than to the
Underwriters pursuant to this Agreement and other than in
connection with the Stock Purchase and Compensation Plans.
6. Conditions of the Underwriters' Obligation. The
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obligation of each Underwriter to purchase the Shares is subject
to the accuracy, on the date of this Agreement and on the Closing
Date and, if later, the Option Closing Date, of the
representations of the Company in this Agreement, to the accuracy
and completeness of all statements made by the Company or any of
its officers in any certificate delivered to the Underwriters or
their counsel pursuant to this Agreement, to performance by the
Company of its obligations under this Agreement and to each of
the following additional conditions:
(a) All filings required by Rule 424 of the Rules
and Regulations must have been made.
(b) No stop order suspending the effectiveness of
the Registration Statement may be in effect and no proceedings
for such purpose may be pending before or threatened by the
Commission and any requests for additional information on the
part of the Commission (to be included in the Registration
Statement or the Prospectus or otherwise) must have been complied
with.
(c) Since the respective dates as of which such
information is given in the Registration Statement and the
Prospectus, as they may be amended or supplemented, (i) there
must not have been any material change in the capital stock or
long-term debt of the Company and its subsidiaries, taken as a
whole, (ii) there must not have been any material adverse change
in the management, business, properties, financial condition, or
results of operations of the Company and its subsidiaries, taken
as a whole, other than transactions in the ordinary course of
business and transactions set forth in or contemplated by the
Prospectus, and (iii) there must not have occurred any event that
makes untrue or incorrect in any material respect any statement
or information contained in the Prospectus or that is not re-
flected in the Prospectus but should be reflected in it in order
to make the statements or information in it not misleading in any
material respect; and in the judgment of the Underwriters, any
such development referred to in clause (i), (ii) or (iii) makes
it impracticable or inadvisable to consummate the sale and
delivery of the Shares by the Underwriters at the initial public
offering price.
(d) The Underwriters must receive on the Closing
Date and, with respect to the Option Shares, on the Option
Closing Date, a certificate, dated such date, of the chief execu-
tive officer, the chief operating officer or the chief financial
officer of the Company certifying that (i) the signer has care-
fully examined the Registration Statement and the Prospectus
(including any Incorporated Documents) and this Agreement, (ii)
the representations of the Company in this Agreement are accurate
on and as of the date of the certificate, (iii) there has not
been any material adverse change in the management, business,
properties, financial condition or results of operations of the
Company and its subsidiaries, taken as a whole, other than
transactions in the ordinary course of business and transactions
set forth in or contemplated in the Prospectus, (iv) to the
knowledge of such officer, no order suspending the effectiveness
of the Registration Statement or prohibiting the sale of the
Shares has been issued and no proceedings for such purpose are
pending before or threatened by the Commission, (v) there has
been no document required to be filed under the Exchange Act and
the Exchange Act Rules and Regulations that upon such filing
would be deemed to be an Incorporated Document that has not been
so filed, and (vi) the Company has performed all agreements that
this Agreement requires it to perform by the Closing Date.
(e) The Underwriters must receive on the Closing
Date and, with respect to the Option Shares, the Option Closing
Date, opinions dated the Closing Date substantially in the form
of Annex B-1 and B-2 to this Agreement from Reid & Priest LLP,
counsel to the Company, and Philip R. Halverson, Esq., general
counsel of the Company, respectively.
(f) The Underwriters must receive on the Closing
Date from Morrison Cohen Singer & Weinstein, LLP, their counsel,
an opinion dated the Closing Date and, with respect to the Option
Shares, the Option Closing Date, with respect to the Company, the
Shares, the Registration Statement, the Prospectus, this
Agreement and the form and sufficiency of all proceedings taken
in connection with the sale and delivery of the Shares. Such
opinion and proceedings will be satisfactory in all respects to
the Underwriters. The Company must have furnished to such
counsel such documents as they may reasonably request for the
purpose of enabling them to render such opinion.
(g) On the Closing Date and, with respect to the
Option Shares, the Option Closing Date, Price Waterhouse LLP must
furnish to the Underwriters a letter, addressed to the
Underwriters and in form and substance reasonably satisfactory to
the Underwriters, confirming that they are independent
accountants with respect to the Company as required by the Act
and the Rules and Regulations and with respect to the financial
and other statistical and numerical information contained in the
Registration Statement or incorporated by reference therein.
(h) Prior to the Closing Date, the Shares must be
duly authorized for listing by the New York Stock Exchange upon
official notice of issuance.
All opinions, letters, evidence and certificates
mentioned above or elsewhere in this Agreement will comply with
this Agreement only if they are in form and scope satisfactory to
counsel for the Underwriters.
7. Indemnification.
---------------
(a) The Company shall indemnify and hold
harmless each Underwriter, the directors, officers, employees and
agents of each Underwriter, and each person, if any, who controls
each Underwriter, within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act, against any and all losses,
claims, damages and liabilities, joint or several (including any
investigation, legal or other expenses reasonably incurred in
connection with, and any amount paid in settlement of, any
action, suit or proceeding or any claim asserted), to which they,
or any of them, may become subject under the Act, the Exchange
Act or other Federal or state statutory law or regulation, at
common law or otherwise, insofar as such losses, claims, damages
or liabilities arise out of or are based on any untrue statement
or alleged untrue statement of a material fact contained in any
preliminary prospectus, the Registration Statement or the Pro-
spectus or any amendment or supplement to the Registration
Statement or the Prospectus (including any Incorporated
Document), or the omission or alleged omission to state in it a
material fact required to be stated in it or necessary to make
the statements in it not misleading; provided, however, that the
Company shall not be liable to the extent that such loss, claim,
damage, or liability arises from the sale of the Shares in the
public offering to any person by any Underwriter and is based on
an untrue statement or omission or alleged untrue statement or
omission (i) made in reliance on and in conformity with informa-
tion furnished in writing to the Company by such Underwriter
expressly for use in the document or (ii) in a preliminary pro-
spectus if the Prospectus corrects the untrue statement or
omission or alleged untrue statement or omission which is the
basis of the loss, claim, damage or liability for which indemni-
fication is sought and a copy of the Prospectus was not sent or
given to such person at or before the confirmation of the sale to
such person in any case where such delivery is required by the
Act, unless such failure to deliver the Prospectus was a result
of noncompliance by the Company with Section 5(d). This
indemnity agreement shall be in addition to any liability that
the Company might otherwise have.
(b) Each Underwriter shall indemnify and hold
harmless the Company, its officers and directors, and each
person, if any, who controls any thereof within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act, to the
same extent as the foregoing indemnity from the Company to each
Underwriter, but only insofar as losses, claims, damages or
liabilities arise out of or are based on any untrue statement or
omission or alleged untrue statement or omission made in or in
reliance on and in conformity with information furnished in
writing to the Company by such Underwriter expressly for use in
preparation of the documents in which the statement or omission
is made or alleged to be made. The Company acknowledges that for
all purposes of this Agreement, the amounts of the selling
commission and reallowance set forth in the Prospectus and
[ ] constitute the only information
-----------------------
furnished in writing to the Company by any Underwriter expressly
for use in the Registration Statement, any preliminary prospectus
or the Prospectus. This indemnity agreement shall be in addition
to any liability that the Underwriters might otherwise have.
(c) Any party that proposes to assert the right
to be indemnified under this Section 7 shall, promptly after
receipt of notice of commencement of any action against such
party in respect of which a claim is to be made against an
indemnifying party or parties under this Section 7, notify in
writing each such indemnifying party of the commencement of such
action, enclosing a copy of all papers served, but the omission
so to notify such indemnifying party shall not relieve it from
any liability that it may have to any indemnified party otherwise
than under this Section 7. If any such action is brought against
any indemnified party and it notifies the indemnifying party of
its commencement, the indemnifying party shall be entitled to
participate in, and, to the extent that it elects by delivering
written notice to the indemnified party promptly after receiving
notice of the commencement of the action from the indemnified
party, jointly with any other indemnifying party similarly
notified, to assume the defense of the action, with counsel
satisfactory to the indemnified party, and, after notice from the
indemnifying party to the indemnified party of its election to
assume the defense, the indemnifying party shall not be liable to
the indemnified party for any legal or other expenses except as
provided below and except for the reasonable costs of
investigation subsequently incurred by the indemnified party in
connection with the defense. The indemnified party shall have
the right to employ its counsel in any such action, but the fees
and expenses of such counsel shall be at the expense of such
indemnified party unless (i) the employment of counsel by the
indemnified party has been authorized in writing by the
indemnifying party, (ii) the indemnified party has been advised
by such counsel employed by it that there may be legal defenses
available to it involving potential conflict with the interests
of an indemnifying party (in which case the indemnifying party
shall not have the right to direct the defense of such action on
behalf of the indemnified party) or (iii) the indemnifying party
has not in fact employed counsel to assume the defense of such
action within a reasonable time after receiving notice of the
commencement of the action, in each of which cases the fees and
expenses of counsel shall be at the expense of the indemnifying
party or parties and all such fees and expenses shall be
reimbursed promptly as they are incurred. An indemnifying party
shall not be liable for any settlement of any action or claim
effected without its written consent or, in connection with any
proceeding or related proceeding in the same jurisdiction, for
the fees and expenses of more than one separate counsel for all
indemnified parties.
8. Contribution. If recovery is not available under
------------
the foregoing indemnification provisions of Section 7, for any
reason other than as specified therein, the parties entitled to
indemnification by the terms thereof shall be entitled to contri-
bution to liabilities and expenses, except to the extent that
contribution is not permitted under Section 11(f) of the Act. In
determining the amount of contribution to which the respective
parties are entitled, there shall be considered the relative
benefits received by each party from the offering of the Shares
(taking into account the portion of the proceeds of the offering
realized by each), the parties' relative knowledge and access to
information concerning the matter with respect to which the claim
was asserted, the opportunity to correct and prevent any
statement or omission, and any other equitable considerations
appropriate under the circumstances. The Company and the Under-
writers agree that it would not be equitable if the amount of
such contribution were determined by pro rata or per capita
allocation. No person found guilty of fraudulent misrepresenta-
tion (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation.
9. Termination. This Agreement may be terminated by
-----------
Underwriters who have agreed to purchase in the aggregate 50% or
more of the Firm Shares by notifying the Company at any time
(a) at or before the Closing Date (or, with
respect to the Option Shares, at or before the Option Closing
Date) if, in the judgment of such Underwriters, payment for the
delivery of the Shares is rendered impracticable or inadvisable
because (i) trading in the equity securities of the Company is
suspended by the Commission or the New York Stock Exchange, (ii)
additional material governmental restrictions, not in force on
the date of this Agreement, are imposed upon trading in
securities generally or minimum or maximum prices have been
generally established on the New York Stock Exchange or on the
American Stock Exchange or trading in securities generally has
been suspended or limited on either such exchange or a general
banking moratorium has been established by Federal or New York
authorities, or (iii) any outbreak or material escalation of
hostilities or other calamity or crisis occurs the effect of
which is such as to make it impracticable to market the Shares,
or
(b) at or before the Closing Date (or, with
respect to the Option Shares, at or before the Option Closing
Date), if any of the conditions specified in Section 6 have not
been fulfilled when and as required by this Agreement.
If this Agreement is terminated pursuant to any of its
provisions, except as otherwise provided, the Company will not be
under any liability to any of the Underwriters and the
Underwriters will not be under any liability to the Company,
except that (1) if this Agreement is terminated by the
Underwriters because of any failure or refusal on the part of the
Company to comply with the terms of this Agreement or because any
of the conditions in Section 6 are not satisfied, the Company
will reimburse the Underwriters for all reasonable out-of-pocket
expenses (including the fees and disbursements of their counsel)
reasonably incurred by them in connection with the proposed
purchase and sale of the Shares, and (2) if the Underwriters fail
or refuse to purchase the Shares agreed to be purchased by them
under this Agreement, without some reason sufficient to justify
cancellation or termination of its obligations under this
Agreement, they will not be relieved of liability to the Company
for damages occasioned by their default.
The Company will not in any event be liable to the
Underwriters for damages on account of loss of anticipated prof-
its.
10. Substitution of Underwriters. If one or more of
----------------------------
the Underwriters shall, for any reason permitted hereunder,
cancel its obligation to purchase hereunder and to take up and
pay for the Firm Shares to be purchased by such one or more
Underwriters, the Company shall immediately notify the remaining
Underwriters, and the remaining Underwriters shall have the
right, within 24 hours of receipt of such notice, either to take
up and pay for (in such proportion as may be agreed upon among
them) or to substitute another underwriter or underwriters,
satisfactory to the Company, to take up and pay for the number of
Firm Shares that such one or more Underwriters did not purchase.
If one or more Underwriters shall, for any reason other than a
reason permitted hereunder, fail to take up and pay for the Firm
Shares to be purchased by such one or more Underwriters, the
Company shall immediately notify the remaining Underwriters, and
the remaining Underwriters shall be obligated to take up and pay
for (in addition to the respective number of Firm Shares set
forth opposite their respective names in Schedule 1), the number
of Firm Shares that such defaulting Underwriter or Underwriters
failed to take up and pay for, up to a number thereof equal to,
in the case of each such remaining Underwriter, ten percent (10%)
of the number of Firm Shares set forth opposite the name of such
remaining Underwriter in Schedule 1, and such remaining
Underwriters shall have the right, within 24 hours of receipt of
such notice, either to take up and pay for (in such proportion as
may be agreed upon among them), or to substitute another
underwriter or underwriters, satisfactory to the Company, to take
up and pay for, the remaining number of the Firm Shares that the
defaulting Underwriter or Underwriters agreed but failed to
purchase. If any unpurchased Firm Shares still remain, then the
Company or the Underwriters shall be entitled to an additional
period of 24 hours within which to procure another party or
parties, who are members of the NASD (or if not members of the
NASD, who are not eligible for membership in the NASD and who
agree (i) to make no sales within the United States, its
territories or its possessions or to persons who are citizens
thereof or residents therein and (ii) in making sales to comply
with the NASD's Rules of Fair Practice) and satisfactory to the
Company, to purchase or agree to purchase such unpurchased Firm
Shares on the terms herein set forth. In any such case, either
the remaining Underwriters or the Company shall have the right to
postpone the Closing Date for a period not to exceed seven full
business days from the date agreed upon in accordance with this
Section 10, in order that the necessary changes in the
Registration Statement and Prospectus and any other documents and
arrangements may be effected. If the Underwriters and the
Company shall fail to procure a satisfactory party or parties as
above provided to purchase or agree to purchase such unpurchased
Firm Shares, then the Company may either (i) require the
remaining Underwriters to purchase the number of Firm Shares that
they are obligated to purchase hereunder (but no more than such
number of Firm Shares) or (ii) terminate this Agreement by giving
prompt notice to the Underwriters. In the event that neither the
remaining Underwriters nor the Company has arranged for the
purchase of such unpurchased Firm Shares by another party or
parties as above provided and the Company has not elected to
require the remaining Underwriters to purchase the number of Firm
Shares that they are obligated to purchase hereunder, then this
Agreement shall terminate without any liability on the part of
any such Underwriter or the Company for the purchase or sale of
any Shares under this Agreement. Any action taken pursuant to
this Section 10 shall not relieve any defaulting Underwriter from
liability in respect of any default of such Underwriters under
this Agreement.
11. Miscellaneous. The reimbursement, indemnification
-------------
and contribution agreements in Sections 5, 7, 8 and 9 and the
representations and agreements of the Company and the Under-
writers in this Agreement will remain in full force and effect
regardless of any termination of this Agreement, any investiga-
tion made by or on behalf of the Underwriters, the Company, or
any controlling person and delivery of and payment for the
Shares.
This Agreement is for the benefit of the several
Underwriters, the Company, and their successors and assigns, and,
to the extent expressed in this Agreement, for the benefit of
persons controlling the several Underwriters or the Company,
directors and officers of the Company and directors, officers,
employees and agents of the several Underwriters, and their
respective successors and assigns, and no other persons,
partnership, association or corporation will acquire or have any
right under or by virtue of this Agreement. The term "successors
and assigns" does not include any purchaser of Shares from any of
the Underwriters merely because of such purchase.
All notices and communications under this Agreement
shall be in writing and mailed or delivered, by messenger,
facsimile transmission or otherwise, to the Underwriters at
[ ] Attention: Corporate Finance
--------------------------------
Department, and to the Company, at 30 West Superior Street,
Duluth, Minnesota 55802, Attention: Chief Financial Officer.
Any such notice or communication shall take effect upon receipt
thereof.
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD
TO THE CONFLICT OF LAWS PRINCIPLES OF SUCH STATE.
This Agreement may be signed in two or more
counterparts with the same effect as if the signatures thereto
and hereto were upon the same instrument.
This Agreement may not be amended or otherwise modified
or any provision hereof waived except by an instrument in writing
signed by the Underwriters and the Company.
Please confirm that the foregoing correctly sets forth
the agreement between us.
Very truly yours,
MINNESOTA POWER & LIGHT COMPANY
By:
-------------------------------
Name:
Title:
Confirmed:
[ ]
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By:
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Name:
Title:
[ ]
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By:
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Name:
Title:
[ ]
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By:
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Name:
Title:
UNDERWRITING AGREEMENT SIGNATURE PAGE
ANNEX A
FORM OF PRICE DETERMINATION AGREEMENT
[ , 199 ]
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Dear Sirs:
Reference is made to the Underwriting Agreement, dated
[ , 199 ] (the "Underwriting Agreement"), among
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Minnesota Power & Light Company, a public utility incorporated
under the laws of Minnesota (the "Company"), and you as the
Underwriters (collectively, the "Underwriters"). The
Underwriting Agreement provides for the purchase by the several
Underwriters from the Company subject to the terms and conditions
set forth therein, of an aggregate of [ ] shares of
---------------
the Company's Common Stock, without par value ("Common Stock"),
and the preferred share purchase rights attached thereto (the
"Rights") (collectively referred to as the "Firm Shares").
Subject to the terms and conditions set forth in the Underwriting
Agreement, the Company has also granted to the Underwriters an
option (the "Option") to purchase up to an additional
[ ] shares of Common Stock and the Rights attached
---------------
thereto (collectively referred to as the "Option Shares"). This
Agreement is the Price Determination Agreement referred to in the
Underwriting Agreement.
Pursuant to Section 1 of the Underwriting Agreement,
the undersigned agrees with the Underwriters as follows:
1. The initial public offering price per share for
the Firm Shares and, if the Option is exercised, the Option
Shares, shall be $[ ].
-------
2. The purchase price per share for the Firm Shares
and, if the Option is exercised, the Option Shares to be paid by
the several Underwriters shall be $[ ], representing an
-------
amount equal to the initial public offering price set forth
above, less $[ ] per share.
-------
The Company represents and warrants to each of the
Underwriters that the representations and warranties of the
Company set forth in Section 4 of the Underwriting Agreement are
accurate as though expressly made at and as of the date hereof.
As contemplated by the Underwriting Agreement, attached
as Schedule 1 is a completed list of the several Underwriters,
which shall be a part of this Agreement and the Underwriting
Agreement.
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD
TO THE CONFLICT OF LAWS PRINCIPLES OF SUCH STATE.
If the foregoing is in accordance with your
understanding of the agreement among the Underwriters and the
Company, please sign and return to the Company a counterpart
hereof, whereupon this instrument along with all counterparts and
together with the Underwriting Agreement shall be a binding
agreement among the Underwriters and the Company in accordance
with its terms and the terms of the Underwriting Agreement.
Very truly yours,
MINNESOTA POWER & LIGHT COMPANY
By:
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Name:
Title:
Confirmed:
[ ]
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By:
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Name:
Title:
[ ]
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By:
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Name:
Title:
[ ]
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By:
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Name:
Title:
PRICE DETERMINATION AGREEMENT SIGNATURE PAGE
SCHEDULE 1
UNDERWRITERS
Number of Firm
Name of Underwriter Shares to be Purchased
------------------- ----------------------
ANNEX B-1
FORM OF OPINION OF REID & PRIEST LLP
[ , 199 ]
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Dear Sirs:
Reference is made to the sale by Minnesota Power &
Light Company (the "Company") of an aggregate of
[ ] shares of its Common Stock, without par value
---------------
(the "Common Stock"), and the preferred share purchase rights
attached thereto (the "Rights") (the Common Stock and the Rights
being collectively referred to as the "Shares"). We advise you
that we have acted as counsel to the Company in connection with
such issuance and sale and have participated in the preparation
of (a) Registration Statement No. [333- ], as filed by the
-----
Company with the Securities and Exchange Commission for the
registration of the Shares under the Securities Act of 1933, as
amended (the "Act") (such registration statement, as amended at
the Effective Date (as such term is defined in the Agreement
referred to below), being hereinafter referred to as the
"Registration Statement"); (b) the prospectus constituting part
of the Registration Statement, as amended and supplemented by a
prospectus supplement dated [ , 199 ], relating to the
---------- -
Shares (such prospectus, as so amended and supplemented, being
hereinafter referred to as the "Prospectus"); and (c) the
Underwriting Agreement dated [ , 199 ], between the
---------- -
Company and you (the"Agreement"). In addition, we have reviewed
the petition filed by the Company with the Minnesota Public
Utilities Commission seeking authorization to issue the Shares,
and the order issued by said Commission in response to said
petition.
We have reviewed all corporate proceedings taken by the
Company in respect of the issuance and sale of the Shares.
Upon the basis of our familiarity with these transac-
tions, we are of the opinion that:
1. The Shares when paid for by the Underwriters in
accordance with the terms of the Agreement will be, duly
authorized, validly issued, fully paid and non-assessable and
will not be subject to any preemptive or similar right; and the
Rights will be validly issued.
2. An authorizing order has been issued by the Minne-
sota Public Utilities Commission certifying the Company's capital
structure and authorizing the issuance and sale of the Shares,
and, to the best of our knowledge, said order is still in full
force and effect; and no further approval, authorization, consent
or order of any public board or body (other than in connection or
in compliance with the provisions of the securities or "Blue Sky"
laws of any jurisdiction) is legally required for the authoriza-
tion of the issuance and sale of the Shares.
3. The Registration Statement and the Prospectus
(except as to the financial statements, statement of income and
other financial or statistical data contained therein, upon which
we do not pass) comply as to form in all material respects with
the requirements of the Act and the applicable instructions,
rules and regulations of the Securities and Exchange Commission
thereunder; the Registration Statement has become, and at the
date hereof the Registration Statement is, effective under the
Act, and, to the best of our knowledge, no proceedings for a stop
order with respect thereto are pending or threatened under
Section 8 of the Act.
4. The statements set forth in the Prospectus under
the captions "Description of Common Stock" and "Description of
Preferred Share Purchase Rights," insofar as they purport to
constitute a summary of the securities, documents and instruments
therein described, are accurate and fairly present the
information contained therein in all material respects.
5. The Agreement has been duly and validly autho-
rized, executed and delivered by the Company and is a valid and
legally binding obligation of the Company.
In passing upon the forms of the Registration Statement
and the Prospectus, we necessarily assume the correctness and
completeness of the statements made or included therein by the
Company and take no responsibility therefor, except insofar as
such statements relate to us and as set forth in the Prospectus
under the heading "Legal Opinions" and in paragraph 4 above. In
the course of the preparation by the Company of the Registration
Statement and the Prospectus, we have had conferences with
certain of its officers and representatives, with other counsel
for the Company and with Price Waterhouse LLP, the independent
certified public accountants who examined certain of the
Company's financial statements incorporated by reference in the
Registration Statement. Our examination of the Registration
Statement and the Prospectus, and our discussions in the
above-mentioned conferences did not disclose to us any informa-
tion which gives us reason to believe that, at the Effective
Date, the Registration Statement contained an untrue statement of
a material fact or omitted to state a material fact required to
be stated therein or necessary to make the statements therein not
misleading or that the Prospectus at the time it was filed
electronically with the Commission pursuant to Rule 424, and the
Prospectus, as amended or supplemented at the date hereof,
contained or contains an untrue statement of a material fact or
omitted or omits to state a material fact necessary in order to
make the statements therein, in the light of the circumstances
under which they were made, not misleading. We do not express
any opinion or belief as to the financial statements, statement
of income or other financial or statistical data contained in the
Registration Statement or in the Prospectus.
We are members of the New York Bar and do not hold
ourselves out as experts on the laws of Minnesota. As to all
matters of Minnesota law (and as to the incorporation of the
Company, titles to property and franchises, upon which we do not
pass), we have relied with your consent upon the opinion of even
date herewith addressed to you by Philip R. Halverson, Esq., Vice
President, General Counsel and Corporate Secretary for the
Company.
Very truly yours,
REID & PRIEST LLP
ANNEX B-2
FORM OF OPINION OF
PHILIP R. HALVERSON, ESQ.
VICE PRESIDENT, GENERAL COUNSEL
AND CORPORATE SECRETARY OF
MINNESOTA POWER & LIGHT COMPANY
[ , 199 ]
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Dear Sirs:
Reference is made to the sale by Minnesota Power &
Light Company (the "Company") of an aggregate of
[ ] shares of its Common Stock, without par value
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(the "Common Stock"), and the preferred share purchase rights
attached thereto (the "Rights") (the Common Stock and the Rights
being collectively referred to as the "Shares"). I advise you
that I have acted as counsel to the Company in connection with
such issuance and sale and have participated in the preparation
of (a) Registration Statement No. [333- ], as filed by the
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Company with the Securities and Exchange Commission for the
registration of the Shares under the Securities Act of 1933, as
amended (the "Act") (such registration statement, as amended at
the Effective Date (as such term is defined in the Agreement
referred to below), being hereinafter referred to as the
"Registration Statement"); (b) the prospectus constituting part
of the Registration Statement, as amended and supplemented by a
prospectus supplement dated [ , 199 ], relating to the
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Shares (such prospectus, as so amended and supplemented, being
hereinafter referred to as the "Prospectus"); and (c) the
Underwriting Agreement dated [ , 199 ], between the
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Company and you (the"Agreement"). In addition, I have reviewed
the petition filed by the Company with the Minnesota Public
Utilities Commission seeking authorization to issue the Shares,
and the order issued by said Commission in response to said
petition.
I have reviewed all corporate proceedings taken by the
Company in respect of the issuance and sale of the Shares.
Upon the basis of my familiarity with these transac-
tions and with the Company's properties and affairs generally, I
am of the opinion that:
1. The Shares, when paid for by the Underwriters in
accordance with the terms of the Agreement, will be duly
authorized, validly issued, fully paid and non-assessable and
will not be subject to any preemptive or similar right; and the
Rights will be validly issued.
2. An authorizing order has been issued by the Minne-
sota Public Utilities Commission certifying the Company's capital
structure and authorizing the issuance and sale of the Shares,
and, to the best of my knowledge, said order is still in full
force and effect; and no further approval, authorization, consent
or order of any public board or body (other than in connection or
in compliance with the provisions of the securities or "Blue Sky"
laws of any jurisdiction) is legally required for the authoriza-
tion of the issuance and sale of the Shares.
3. The Registration Statement and the Prospectus
(except as to the financial statements, statement of income and
other financial or statistical data contained therein, upon which
I do not pass) comply as to form in all material respects with
the requirements of the Act and the applicable instructions,
rules and regulations of the Securities and Exchange Commission
thereunder; the Registration Statement has become, and at the
date hereof the Registration Statement is, effective under the
Act, and, to the best of my knowledge, no proceedings for a stop
order with respect thereto are pending or threatened under
Section 8 of the Act.
4. The statements set forth in the Prospectus under
the captions "Description of Common Stock" and "Description of
Preferred Share Purchase Rights," insofar as they purport to
constitute a summary of the securities, documents and instruments
therein described, are accurate and fairly present the
information contained therein in all material respects.
5. The Agreement has been duly and validly autho-
rized, executed and delivered by the Company and is a valid and
legally binding obligation of the Company.
6. The Company is a validly organized and existing
corporation under the laws of the State of Minnesota and is duly
qualified to do business, and is doing business, in that State.
7. The Company is a public utility corporation duly
authorized by its Articles of Incorporation to conduct the
business which it is now conducting as set forth in the Prospec-
tus and the Company holds valid and subsisting franchises,
licenses and permits authorizing it to carry on the utility
business in which it is engaged.
8. Each subsidiary of the Company is a validly
organized and existing corporation under the laws of the State of
its incorporation and is duly qualified to do business, and is
doing business, in such State and in each other State in which
the failure to qualify as a foreign corporation would be material
to the Company and its subsidiaries, taken as a whole.
9. Other than as stated in the Registration Statement
and the Prospectus there are no pending legal proceedings to
which the Company or any subsidiary is a party or of which
property of the Company or any subsidiary is the subject, which
depart from the ordinary routine litigation incident to the kind
of business conducted by the Company or any such subsidiary, and
which is material to the Company and its subsidiaries, taken as a
whole, and, to the best of my knowledge, no such proceedings are
known to be contemplated by governmental authorities.
10. The portions of the answers to the items of the
Registration Statement and the portions of the information
contained in the Prospectus, which are stated therein to have
been made on my authority as General Counsel of the Company, have
been reviewed by me and, as to matters of law and legal
conclusions, are correct.
11. Neither the issue and sale by the Company of the
Shares as contemplated by the Agreement nor the consummation by
the Company of the other transactions contemplated by the Agree-
ment conflicts with, or results in a breach of, the charter or
by-laws of the Company or any subsidiary or any agreement or
instrument known to me to which the Company or any subsidiary is
a party or by which the Company or any subsidiary is bound, any
law or regulation or, so far as is known to me, any order or
regulation of any court, governmental instrumentality or arbitra-
tor.
12. To the best of my knowledge, the Company is not
currently in breach of, or in default under, any material written
agreement or instrument to which it is a party or by which it or
its property is bound or affected, and which breach or default is
material to the Company and its subsidiaries, taken as a whole.
In passing upon the forms of the Registration Statement
and the Prospectus, I necessarily assume the correctness and
completeness of the statements made or included therein by the
Company and take no responsibility therefor, except insofar as
such statements relate to me and as set forth in the Prospectus
under the headings "Experts" and "Legal Opinions" and in
paragraphs 4 and 10 above. In the course of the preparation by
the Company of the Registration Statement and the Prospectus, I
had conferences with certain of its officers and representatives,
with other counsel for the Company and with Price Waterhouse LLP,
the independent certified public accountants who examined certain
of the Company's financial statements incorporated by reference
in the Registration Statement. My examination of the
Registration Statement and the Prospectus, and my discussions in
the above-mentioned conferences did not disclose to me any
information which gives me reason to believe that, at the Effec-
tive Date, the Registration Statement contained an untrue state-
ment of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading or that the Prospectus at the time it was
filed electronically with the Commission pursuant to Rule 424,
and the Prospectus, as amended or supplemented at the date
hereof, contained or contains an untrue statement of a material
fact or omitted or omits to state a material fact necessary in
order to make the statements therein, in the light of the circum-
stances under which they were made, not misleading. I do not
express any opinion or belief as to the financial statements,
statement of income or other financial or statistical data
included in the Registration Statement or in the Prospectus.
Very truly yours,
Philip R. Halverson
Exhibit 5(a)
MINNESOTA POWER & LIGHT COMPANY
30 West Superior Street
Duluth, Minnesota 55802
Philip R. Halverson - Vice President,
General Counsel and Corporate Secretary
May 8, 1998
Minnesota Power & Light Company
30 West Superior Street
Duluth, Minnesota 55802
Dear Sirs:
Referring to the proposed issuance and sale by Minnesota
Power & Light Company (Company) of not to exceed 3,000,000 shares
of the Company's Common Stock, without par value (Stock) and the
Preferred Share Purchase Rights attached thereto (Rights) (the
Stock and the Rights being collectively referred to as the
"Shares"), as contemplated in the registration statement to be
filed by the Company on or about the date hereof with the
Securities and Exchange Commission under the Securities Act of
1933, as amended, I am of the opinion that:
1. The Company is a corporation validly organized and existing
under the laws of the State of Minnesota.
2. All action necessary to make the Stock validly issued, fully
paid and non-assessable and the Rights validly issued will
have been taken when:
a) At a meeting or meetings of the Company's Board of
Directors (or the Executive Committee of the Board of
Directors) favorable action shall have been taken to
approve and authorize the issuance and sale of the
Shares and any other action necessary to the
consummation of the proposed issuance and sale of the
Shares;
b) The Minnesota Public Utilities Commission shall have
authorized the issuance and sale of the Shares;
c) The Stock shall have been issued and delivered for the
consideration contemplated in the registration
statement; and
d) The Rights shall have been issued in accordance with
the terms of the Rights Agreement dated as of July 24,
1996 between the Company and the Corporate Secretary of
the Company, as Rights Agent.
I hereby consent to the use of my name in such registration
statement and to the use of this opinion as an exhibit thereto.
Sincerely,
/s/ Philip R. Halverson
Philip R. Halverson
Exhibit 5(b)
REID & PRIEST LLP
40 West 57th Street
New York, N.Y. 10019-4097
Telephone 212 603-2000
Fax 212 603-2001
New York, New York
May 8, 1998
Minnesota Power & Light Company
30 West Superior Street
Duluth, Minnesota 55802
Dear Sirs:
Referring to the proposed issuance and sale by
Minnesota Power & Light Company ("Company") of not to exceed
3,000,000 shares of the Company's Common Stock, without par value
("Stock") and the Preferred Share Purchase Rights attached
thereto ("Rights") (the Stock and the Rights being collectively
referred to as the "Shares"), as contemplated in the registration
statement to be filed by you on or about the date hereof with the
Securities and Exchange Commission under the Securities Act of
1933, as amended, we are of the opinion that:
1. The Company is a corporation validly organized and
existing under the laws of the State of Minnesota.
2. All action necessary to make the Stock validly
issued, fully paid and non-assessable and the Rights validly
issued will have been taken when:
a) At a meeting or meetings of the Company's
Board of Directors (or the Executive Committee of the Board of
Directors) favorable action shall have been taken to approve and
authorize the issuance and sale of the Shares and any other
action necessary to the consummation of the proposed issuance and
sale of the Shares;
b) The Minnesota Public Utilities Commission
shall have authorized the issuance and sale of the Shares;
c) The Stock shall have been issued and
delivered for the consideration contemplated in the registration
statement; and
d) The Rights shall have been issued in
accordance with the terms of the Rights Agreement dated as of
July 24, 1996 between the Company and the Corporate Secretary of
the Company, as Rights Agent.
We are members of the New York Bar and do not hold
ourselves out as experts on the laws of the State of Minnesota.
As to all matters of Minnesota law, we have relied with your
consent upon an opinion of even date herewith addressed to you by
Philip R. Halverson, Esq., Vice President, General Counsel and
Secretary to the Company.
We hereby consent to the use of our name in such
registration statement and to the use of this opinion as an
exhibit thereto.
Very truly yours,
/s/ REID & PRIEST LLP
REID & PRIEST LLP
EXHIBIT 23(A)
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the
Prospectus constituting part of this Registration Statement on
Form S-3 of our report dated January 26, 1998, which appears on
page 32 of the 1997 Annual Report to Shareholders of Minnesota
Power & Light Company, which is incorporated by reference in
Minnesota Power & Light Company's Annual Report on Form 10-K for
the year ended December 31, 1997. We also consent to the
incorporation by reference of our report on the Financial
Statement Schedule, which appears on page 31 of such Annual
Report on Form 10-K. We also consent to the reference to us
under the heading "Experts" in such Prospectus.
/s/ PRICE WATERHOUSE LLP
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PRICE WATERHOUSE LLP
Minneapolis, Minnesota
May 7, 1998