-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, JRL5ETQBuHDp6+t5FD9IBH1IRuCd2QkxilISh1mC7ViDDubQFYrGo0QDK4QRRrvV EXYZxiA0YqrnHG3ePZOh9g== 0000043704-96-000013.txt : 19960923 0000043704-96-000013.hdr.sgml : 19960923 ACCESSION NUMBER: 0000043704-96-000013 CONFORMED SUBMISSION TYPE: POS AM PUBLIC DOCUMENT COUNT: 6 FILED AS OF DATE: 19960920 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: GREEN MOUNTAIN POWER CORP CENTRAL INDEX KEY: 0000043704 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRIC SERVICES [4911] IRS NUMBER: 030127430 STATE OF INCORPORATION: VT FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: POS AM SEC ACT: 1933 Act SEC FILE NUMBER: 033-59383 FILM NUMBER: 96632738 BUSINESS ADDRESS: STREET 1: 25 GREEN MOUNTAIN DR STREET 2: P.O.BOX 850 CITY: SOUTH BURLINGTON STATE: VT ZIP: 05402-0850 BUSINESS PHONE: 8028645731 MAIL ADDRESS: STREET 1: 25 GREEN MOUNTAIN DR STREET 2: P O BOX 850 CITY: SOUTH BURLINGTON STATE: VT ZIP: 05402-0850 POS AM 1 Registration No. 33-59383 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Post-Effective Amendment No. 1 to Form S-3 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 Green Mountain Power Corporation (Exact name of registrant as specified in its charter) Vermont 03-0127430 03-0127430 (State of incorporation) (I.R.S. Employer Identification No.) 25 Green Mountain Drive South Burlington, Vermont 05403 Telephone number: (802) 864-5731 (Address of principal executive offices) Christopher L. Dutton Peter H. Zamore Vice President, Chief Financial Officer General Counsel and Treasurer Green Mountain Power Corporation Green Mountain Power Corporation 25 Green Mountain Drive 25 Green Mountain Drive South Burlington, Vermont 05403 South Burlington, Vermont 05403 Telephone: (802) 864-5731 Telephone: (802) 864-5731 (Name, address, and telephone number, including area codes, of agents of service) The Registrant hereby amends this Post-Effective Amendment No. 1 to 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 Post-Effective Amendment No. 1 to Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until this Post-Effective Amendment shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine. SUBJECT TO COMPLETION, DATED SEPTEMBER 20, 1996 PROSPECTUS GREEN MOUNTAIN POWER CORPORATION First Mortgage Bonds Unsecured Notes Preferred Stock Common Stock Green Mountain Power Corporation (the "Company") intends from time to time to sell its First Mortgage Bonds (the "New Bonds"), Unsecured Notes (the "Notes"), Preferred Stock, Class E, $100 par value (the "New Preferred Stock") and/or Common Stock, $3.33 1/3 par value (the "New Common Stock") (the "New Bonds" and the "Notes" being collectively referred to herein as the "Debt Securities", and the "Debt Securities", the "New Preferred Stock" and the "New Common Stock" being collectively referred to herein as the "Securities") in any combination at an aggregate initial offering price not to exceed $50,000,000. The Securities will be offered at prices and on terms to be determined at the times of sale. For each issue of the Debt Securities and New Preferred Stock for which this Prospectus will be delivered, there will be an accompanying Prospectus Supplement, together with any accompanying Pricing Supplement, that will set forth the specific terms of the Debt Securities or New Preferred Stock of such issue, as the case may be. For each issue of the New Common Stock for which this Prospectus will be delivered, there will be an accompanying Prospectus Supplement that will set forth the terms of the offering. The Common Stock is traded on the New York Stock Exchange. Its price and volume data are reported on the New York Stock Exchange using the symbol "GMP". The sale of one of the Securities will not be contingent upon the sale of any other. ____________________________ THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR BY 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 Securities may be sold directly by the Company or through agents designated from time to time or through underwriters or dealers. If any agents of the Company or any underwriters are involved in the sale of the Securities in respect of which this Prospectus will be delivered, the names of such agents or underwriters, and the initial price to the public, any applicable commissions or discounts and the net proceeds to the Company, or the means of determining the same, will be set forth in an accompanying Prospectus Supplement or Supplements. The Company may indemnify agents and underwriters against certain civil liabilities, including liabilities under the Securities Act of 1933, as amended. See "Plan of Distribution". The date of this Prospectus is _____ __, 1996. 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 State in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such State. AVAILABLE INFORMATION The Company is subject to the informational requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act") and, in accordance therewith, files reports, proxy statements and other information with the Securities and Exchange Commission (the "Commission"). The Registration Statement and such exhibits and schedules may be inspected without charge at the public reference facilities maintained by the Commission at 450 Fifth Street, N.W., Washington, D.C., and at the regional offices of the Commission located at Seven World Trade Center, Suite 1300, New York, New York 10048, and 500 West Madison Street, Suite 1400, Chicago, Illinois 60661, at prescribed rates. Copies of such material may also be obtained from the Public Reference Section of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549. The Company's Common Stock is listed on the New York Stock Exchange. The Commission also maintains a Web site that contains reports, proxy and information statements and other information regarding registrants that file electronically with the Commission and the address of that Web site is http://www.sec.gov. Such reports, proxy statements and other information concerning the Company can also be inspected at the offices of the New York Stock Exchange, 20 Broad Street, New York, New York 10005. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE The following documents, heretofore filed with the Commission (File No. 1-8291) pursuant to the Exchange Act, are hereby incorporated by reference: (1) The Company's Annual Report on Form 10-K for the year ended December 31, 1995. (2) The Company's Quarterly Reports on Form 10-Q for the quarters ended March 31 and June 30, 1996. All documents filed by the Company pursuant to Section 13(a) and (c), 14 or 15(d) of the Securities and Exchange Act after the date of this Prospectus and prior to the termination of this offering shall be deemed to be incorporated by reference into this Prospectus and to be a part hereof from the date of filing of such 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 also is or is deemed to be incorporated by reference herein modifies or supersedes such statement. Any statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this Prospectus. The Company hereby undertakes to provide, without charge, to each person, including any beneficial owner, to whom a copy of this Prospectus shall have been delivered, upon the written or oral request of any such person, a copy of any or all of the documents which have 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. Written or telephone requests for such copies should be directed to the Corporate Secretary, Green Mountain Power Corporation, 25 Green Mountain Drive, P. O. Box 850, South Burlington, Vermont 05402-0850 (Telephone 802-864-5731). THE COMPANY The Company is a public utility operating company engaged in supplying electrical energy in the State of Vermont in a territory with an estimated population of 198,000. The Company has its principal executive office at 25 Green Mountain Drive, P. O. Box 850, South Burlington, Vermont 05402-0850 (Telephone 802-864-5731.) It serves approximately 81,500 customers. COVERAGE RATIOS As computed in accordance with Regulation S-K of the Commission, the Company's ratios of earnings to fixed charges and preferred stock dividends and earnings to fixed charges for each of the years 1991 through 1995, and for the twelve months ended June 30, 1996, are as follows: Ratio of Earnings to Ratio of Fixed Charges and Earnings to Year Ended Preferred Stock Dividends (1) Fixed Charges (1) December 31, 1991 2.40 2.73 December 31, 1992 2.66 3.01 December 31, 1993 2.46 2.78 December 31, 1994 2.44 2.74 December 31, 1995 2.57 2.87 Twelve Months Ended June 30, 1996 2.51 2.80 ______ (1) Earnings consist of pretax income plus fixed charges as defined in Item 503 paragraph (d)(3). Fixed charges computed pursuant to paragraph (d)(4) of Item 503 consist of interest on all indebtedness, amortization of debt expense and discount or premium relating to any indebtedness, and the estimated interest portion of rentals charged to income. Preferred stock dividends consist of dividends paid on all outstanding Preferred Stock. USE OF PROCEEDS AND FINANCING PROGRAM The net proceeds to be received by the Company from the sale of the Securities will be applied to the refunding of long-term debt, the financing of capital projects and the repayment of short-term bank borrowings incurred for such purposes and for other general corporate purposes. The Company expects its capital expenditures in 1996 to be approximately $28 million. The Company expects such expenditures for the five-year period, 1996-2000, to aggregate approximately $101 million. The Company anticipates that for the period 1996 - 2000, internally generated funds, after payment of dividends, will provide approximately 73 percent of total capital expenditure requirements for construction, sinking fund obligations and other requirements. The remaining amount will be funded through short-term borrowings, which will be refinanced periodically through the sale of long-term debt and equity securities, in such amounts and at such times as the Company's cash requirements and market conditions shall determine. DESCRIPTION OF THE NEW BONDS The statements under this caption are intended to summarize the New Bonds and the Mortgage; they do not purport to be complete and are qualified in their entirety by reference to the New Bonds and the Mortgage, copies of which have been filed as exhibits to the Registration Statement of which this Prospectus is a part. General. The New Bonds are to be issued under the Company's Indenture of First Mortgage and Deed of Trust, dated as of February 1, 1955, to the United States Trust Company of New York [successor to the Chase Manhattan Bank (National Association), successor to the Chase National Bank of the City of New York], as trustee, as supplemented by 16 supplemental indentures and as to be further supplemented by one or more additional supplemental indentures providing for one or more series of the New Bonds, all of which are collectively referred to as the Mortgage. Reference is made to the Prospectus Supplement or Supplements for each issue of the New Bonds for the following terms, among others, of the New Bonds offered thereby: (i) the series designation and aggregate principal amount thereof, (ii) the initial public offering price and other terms of their offering, (iii) the date or dates on which they will mature, (iv) the rate or rates per annum at which they will bear interest, (v) the times at which such interest will be payable and the date from which it will accrue, (vi) whether all or any portion thereof will be issued to a designated depositary, (vii) any redemption or repayment provisions, and (viii) other specific terms. Form, Exchange and Payment. Unless otherwise indicated in the Prospectus Supplement for an issue of the New Bonds, the New Bonds offered thereby will be issued only in the form of a fully registered global bond, interests in which will be transferable by a book-entry system in denominations of $1,000 and any multiple thereof. If definitive New Bonds are exchanged for a global bond, they will be issued in denominations of $1,000 and integral multiples of $1,000. See "Book-Entry System." Security. The New Bonds together with all other bonds ("Bonds") now or hereafter issued under the Mortgage will be secured by the Mortgage, which, in the opinion of Peter H. Zamore, Esq., General Counsel of the Company, subject only to permitted encumbrances as defined in the Mortgage, constitutes a valid, direct first mortgage lien upon the real and personal property described or referred to in the Mortgage as owned by the Company (other than classes of property expressly excepted in the Mortgage and property heretofore released from the lien of the Mortgage in accordance with the terms thereof), which include all of the physical properties and franchises of the Company used or useful in its public utility business; and all physical properties and franchises of the Company used or useful in its public utility business (other than those of the character not subject to the lien of the Mortgage as aforesaid) acquired by the Company after the respective dates of the Original Indenture and each Supplemental Indenture have become, or will upon such acquisition become, subject to the lien thereof, subject, however, to permitted encumbrances and to liens, if any, existing or placed thereon by the Company at the time of the acquisition thereof by the Company and, subject, in the case of after acquired properties located in municipalities or counties in which the Mortgage has not been recorded at or prior to the time of acquisition, to the rights of holders or liens perfected on such properties prior to the recording of the Mortgage in such municipalities or counties. There are excepted from the lien of the Mortgage certain specifically excepted properties; all cash on hand and in banks, contracts, shares of stock, bonds, notes, evidences of indebtedness and other securities, bills, notes and accounts receivable and other choses in action, conditional sales agreements and appliance rental or lease agreements other than those expressly subjected to the Mortgage; all equipment, materials and supplies not installed as part of the fixed property of the Company and which are held for use or consumption in its business; all goods, wares, merchandise, appliances and supplies, purchased, acquired or held for the purpose of sale, lease or distribution; and gas, oil, coal, fissionable material and other minerals and other products, fuel and other personal property which are consumable in their use in the operation of the plants or systems of the Company; office furniture, equipment and supplies; aircraft, automobiles, trucks and similar vehicles; and certain other properties of the Company set forth in the Mortgage. (See Mortgage, Granting Clauses.) The Mortgage contains provisions subjecting after-acquired property (subject to pre-existing liens) to the lien thereof, subject to limitations in the case of consolidation, merger or sale of substantially all of the Company's assets. (See Mortgage, Granting Clauses and Article Fourteen.) The Mortgage provides that the trustees shall have a lien upon the mortgaged property, prior to that of the Bonds, for the payment of their reasonable compensation and expenses, and for indemnity against certain liabilities. (See Mortgage, Section 15.10.) Issuance of Additional Bonds. Additional Bonds of any series may be issued in an aggregate principal amount equal to: (1) 60 percent of unfunded net property additions (the cost or fair value at the time of acquisition, whichever is less, of utility property charged to plant accounts of the Company after December 31, 1954, less the minimum provision for depreciation from said date); (2) the principal amount of unfunded Bond credits for the retirement of Bonds of any series; and /or (3) cash deposited with the Trustee; subject to the filing of an earnings certificate (except in the case of certain refundings) showing net earnings available for interest (as defined), for a period of 12 consecutive months within the 15 calendar months preceding the date of application, to be at least two times annual interest requirements on bonded debt then to be outstanding. Property additions generally include the utility property, tangible or intangible, of the Company, located in the United States of America, which (except as provided below) is used by or useful to the Company in the business of generating, manufacturing, storing, transmitting, distributing, utilizing, purchasing, furnishing, supplying and/or disposing of electricity and/or gas, for heat, light, power, or refrigeration or other uses, or in any business which is incidental thereto, including, without limiting the generality of the foregoing, all properties necessary or appropriate for generating, manufacturing, storing, transmitting, distributing, utilizing, purchasing, furnishing, supplying and/or disposing of electricity and/or gas, together with betterments, improvements, additions, replacements, or alterations of, upon or to such property of the Company acquired after December 31, 1954. Utility property shall not be deemed to include any property excepted from the lien of the Mortgage. As of July 31, 1996, approximately $35 million of property additions and unfunded Bond Credits were available for use as the basis for the issuance of Bonds. The Mortgage contains certain restrictions upon the issuance of Bonds against property subject to liens. The New Bonds will be issued against property additions and/or unfunded Bond Credits for the retirement of Bonds. (See Mortgage, Articles Two, Seven, Nine and Fourteen.) The Mortgage provides that the Company and/or the Trustee may release property from the lien of the Mortgage, so long as no default exists: (1) in the ordinary course of the Company's business, with respect to property which has become old or worn out, provided such property is replaced by the Company, and in connection with a release, surrender, abandonment or termination of any rights of the Company which is necessary, desirable or advisable in connection with the conduct of the utility business of the Company; (2) upon written request of the Company to the Trustee in connection with the sale of any such property, provided that the Company shall receive fair consideration therefor and provided that the release will not impair the security of the Mortgage; (3) in connection with a condemnation by any government entity of property of the Company, provided the Company receives fair value therefor; (4) without any consent or release by the Trustee, in connection with a sale of property by the Company of property no longer used or useful in the conduct of the Company's business, provided that the aggregate value of any such property so disposed of in any one calendar year shall not exceed the greater of $50,000 or 3/4 of 1% of the outstanding Bonds; or (5) in connection with the taking, sale or release of all or substantially all of the Company's property, upon the deposit of Government or purchase money securities with the Trustee. (See Mortgage, Article Seven.) Defaults and Notice Thereof. The Mortgage defines the following events as "defaults": (1) failure to pay principal of, or premium (if any) on, any Bond when due; (2) failure to pay interest on any Bond when due and continuance of such failure for a period of 30 days; (3) failure to discharge or satisfy any improvement, maintenance, or depreciation fund obligation and continuance of such failure for a period of 60 days; (4) failure to discharge or satisfy any sinking fund obligation and continuance of such failure for a period of 20 Business Days; (5) failure to perform or observe any of the other covenants, agreements or conditions in the Mortgage and continuance of such failure for a period of 90 days following written notice by the Trustee or by holders of at least 15 percent in principal amount of the Bonds; (6) the entry of an order for reorganization or appointment of a trustee or receiver of all or a substantial part of the mortgaged property and continuance of such order or appointment unstayed for a period of 90 days; (7) certain adjudications, petitions or consents in bankruptcy, insolvency or reorganization proceedings or an admission of insolvency or an assignment for the benefit of creditors by the Company; or (8) the rendering of a judgment against the Company for the payment of moneys in excess of the Judgment Amount (as herein defined) and continuance of such judgment unsatisfied and without stay of execution for a period of 90 days after (i) the entry of such judgment or (ii) the termination of any stay of execution entered during the initial 90-day grace period; but only, in either case, if such judgment shall have been continued unstayed or unsatisfied for a period of 10 days after the giving of written notice of default to the Company by the Trustee or to the Company and the Trustee by the holders of at least 15 percent in principal amount of the Bonds outstanding. As used herein, "Judgment Amount" shall mean (a) $50,000 until the earlier to occur of (i) all Bonds of any series established prior to the execution of the Company's Tenth Supplemental Indenture having ceased to be outstanding, whether at their respective stated maturities or through a provision for redemption prior to their stated maturities, or (ii) the execution of a supplemental indenture with the written consent of the holders of not less than 66 2/3 percent in principal amount of all Bonds of any series heretofore created and issued (and, if more than one such series of Bonds shall at the time be outstanding, not less than 66 2/3 percent in principal amount of the Bonds of each such series), and (b) thereafter $1,000,000. So long as one or more of such defaults shall continue to exist and provided that the principal of all the Bonds shall not have already become due and payable, either the Trustee (by notice in writing to the Company) or the holders of not less than 25 percent in principal amount of the Bonds outstanding (by notice in writing to the Company and the Trustee) may declare the principal of and accrued interest on all Bonds then outstanding to be immediately due and payable notwithstanding the Company's right, following such declaration but prior to any sale of all or a substantial part of the mortgaged property, to cure all defaults to the satisfaction of the Trustee in accordance with the terms of the Indenture. (See Mortgage, Article Twelve.) The Mortgage does not require the Company to give the Trustee or any holders of any Bonds periodic reports as to the Company's compliance with the provisions of the Mortgage. The Company and the Trustee are required to provide the notices and reports to the holders of the Bonds required by the Trust Indenture Act of 1939, as amended, and copies of the reports and information required under the Securities Exchange Act of 1934, as amended. (See Mortgage, Article Eleven.) Evidence to be Furnished to the Trustee. Compliance with Mortgage provisions is evidenced by written statements of the Company's officers or persons selected by the Company. In certain major matters the accounting, engineer, appraiser or other expert must be independent. Various certificates and other papers, including a certificate with respect to compliance with the terms of the Mortgage and the absence of defaults, are required to be filed annually and upon the occurrence of certain events. (See Mortgage, Sections 9.06, 9.07, 9.08.) Modification of the Mortgage. The Mortgage may be amended and/or any past default thereunder (except a default in the payment of the principal of, premium, if any, or interest on any of the Bonds) and its consequences may be waived with the consent of the holders of at least 66 2/3 percent in principal amount of Bonds then outstanding, and of each series of Bonds then outstanding and affected by the proposed modification or waiver. Upon the earlier to occur of (i) all Bonds of any series established prior to the execution of the Company's Tenth Supplemental Indenture having ceased to be outstanding, whether at their respective stated maturities or through a provision for redemption prior to their stated maturities, and (ii) the execution of a supplemental indenture with the written consent of the holders of all Bonds of any series created and issued prior to the date of the Tenth Supplemental Indenture, the Mortgage may be amended and/or any past default thereunder (except a default in the payment of the principal of, premium, if any, or interest on any of the Bonds) and its consequences may be waived with the consent of the holders, acting together as a single class, of at least 66 2/3 percent in principal amount then outstanding of all Bonds issued pursuant to the Indenture and affected by the proposed modification or waiver. In no instance shall any modification regarding the terms of payment of principal of, premium, if any, and interest on the New Bonds or a waiver of any past default with respect to payment of such principal, premium or interest or its consequences be effected without the consent of the holders of the New Bonds, nor may any modification affecting the lien of the Mortgage or reducing the percentage in principal amount of Bonds required for modification, be effected without the consent of the holders of all outstanding Bonds. (See Mortgage, Article Eighteen and Tenth Supplemental Indenture.) Concerning the Trustee. United States Trust Company of New York, successor to the Chase Manhattan Bank (National Association), successor to the Chase National Bank of the City of New York, is the trustee under the Mortgage. DESCRIPTION OF THE NOTES The statements under this caption are intended to summarize the Notes and the Indenture; they do not purport to be complete and are qualified in their entirety by reference to the Notes and Indenture, copies of which have been filed as exhibits to the Registration Statement of which this Prospectus is a part. General. The Notes are to be issued under an Indenture ("Indenture") between the Company and The Bank of New York, as trustee ("Unsecured Trustee"). The Indenture provides that debt securities (including the Notes and including both interest bearing and original issue discount securities) may be issued thereunder, without limitation as to aggregate principal amount. (See Indenture, Sec. 301.) All debt securities issued under the Indenture (including the Notes) are collectively referred to as the "Indenture Securities". The Indenture does not limit the amount of other debt, secured or unsecured, which may be issued by the Company. The Notes will rank pari passu with all other unsecured indebtedness of the Company. Substantially all of the materially important physical properties of the Company are subject to the lien of the Mortgage securing the Bonds. (See "Description of the New Bonds".) Reference is made to the Prospectus Supplement or Supplements for each issue of the Notes for the following terms, among others, of the Notes offered thereby: (i) the series designation and aggregate principal amount thereof, (ii) the initial public offering price and other terms of their offering, (iii) the date or dates on which they will mature, (iv) the rate or rates per annum at which they will bear interest, (v) the times at which such interest will be payable and the date from which it will accrue, (vi) whether all or any portion thereof will be issued to a designated depositary, (vii) any redemption or repayment provisions, and (viii) other specific terms. Form, Exchange and Payment. Unless otherwise indicated in the Prospectus Supplement for an issue of the Notes, the Notes offered thereby will be issued only in the form of a fully registered global note, interests in which will be transferable by a book-entry system in denominations of $1,000 and any multiple thereof. If definitive Notes are exchanged for a global note, they will be issued in denominations of $1,000 and integral multiples of $1,000. See "Book-Entry System." Events of Default and Notice Thereof. The Indenture defines the following events as "defaults": (1) failure to pay any installment of interest on any Note within 30 days after its stated maturity; (2) failure to pay the principal of, or premium, if any, on any Note within three business days after its maturity; (3) failure to perform or breach of any covenant of the Company in the Indenture (other than a covenant, a default in the performance of which is elsewhere specifically dealt with or which has been included in the Indenture solely for the benefit of one or more series of Notes other than such series) for a period of 90 days after there has been given, by registered or certified mail, to the Company by the Unsecured Trustee, or to the Company and the Unsecured Trustee by the holders of at least 33% in principal amount of the outstanding Notes of such series a written notice specifying such default and requiring it to be remedied and stating that such notice is a "Notice of Default"; (4) either (a) the entry of an order approving a petition seeking reorganization of the Company upon the basis of insolvency or inability to pay debts as they mature under the Federal bankruptcy laws or any other applicable law or statute of the United States of America or any State thereof; or (b) the appointment in any judicial proceeding upon the application of any creditor or creditors of a trustee or a receiver of all or a substantial part of the trust estate; and the continuance of such order or appointment unstayed and in effect for a period of 90 days; (5) the adjudication of the Company as a bankrupt by any court of competent jurisdiction or the filing by the Company of a voluntary petition in bankruptcy or the making by the Company of an assignment for the benefit of creditors or the admission by the Company in writing of its inability to pay its debts as they become due; the consent by the Company to the appointment in any judicial proceeding upon the application of any creditor or creditors of a receiver or trustee of all or a substantial part of its properties; the filing by the Company of a petition or answer seeking reorganization or readjustment on the basis of insolvency or inability to pay debts as they mature under the Federal bankruptcy laws or any other applicable law or statute of the United States of America or of any State thereof; or the filing by the Company of a petition to take advantage of any insolvency act; (6) any other Event of Default specified with respect to Notes of such series; (7) default by the Company in the payment of principal of, or interest on, securities issued under the Mortgage in an aggregate amount exceeding $5,000,000, and the continuation thereof for 90 days after written notice to the Company by the Unsecured Trustee, or to the Company and the Unsecured Trustee by the holders of at least 33% in principal amount of the outstanding Notes of such series a written notice specifying such default and requiring it to be remedied and stating that such notice is a "Notice of Default". No Event of Default with respect to a series of Indenture Securities necessarily constitutes an Event of Default with respect to the Indenture Securities of any other series. The Unsecured Trustee may withhold notice of default (except in payment of principal, interest or any funds for the retirement of Indenture Securities) if it, in good faith, determines that withholding of such notice is in the interest of the Holders of the Indenture Securities. (See Indenture, Secs. 801 and 903.) Either the Unsecured Trustee or the Holders of not less than 33% in principal amount (or such lesser amount as may be provided in the case of discount Indenture Securities) of the outstanding Indenture Securities of all defaulted series, considered as one class, may declare the principal and interest on such series due on default, but the Company may annul such default by effecting its cure and paying overdue interest and principal. No Holder of Indenture Securities may enforce the Indenture without having given the Unsecured Trustee written notice of default, and unless the Holders of a majority of the Indenture Securities of all defaulted series, considered as one class, shall have requested the Unsecured Trustee to act and offered reasonable indemnity, and for 60 days the Unsecured Trustee shall have failed to act, but each Holder has an absolute right to receive payment of principal and interest when due and to institute suit for the enforcement of such payment. The Unsecured Trustee is not required to risk its funds or incur any financial liability if it shall have reasonable grounds for believing that repayment is not reasonably assured. The Holders of a majority of the Indenture Securities of all defaulted series, considered as one class, may direct the time, method and place of conducting any proceedings for any remedy available to the Unsecured Trustee, or exercising any trust or power conferred on the Unsecured Trustee, with respect to the Indenture Securities of such series, but the Unsecured Trustee is not required to follow such direction if not sufficiently indemnified and the Unsecured Trustee may take any other action it deems proper which is not inconsistent with such direction. (See Indenture, Secs. 802, 807, 808, 812 and 902.) Evidence to be Furnished to the Unsecured Trustee. Compliance with Indenture provisions will be evidenced by written statements of the Company's officers. An annual certificate with reference to compliance with the covenants and conditions of the Indenture and the absence of defaults is required to be filed with the Unsecured Trustee. (See Indenture, Sec. 1004.) Modification of the Indenture. The rights of the Holders of the Indenture Securities may be modified with the consent of the Holders of a majority of the Indenture Securities of all series or Tranches, as defined below, affected, considered as one class. However, certain specified rights of the Holders of Indenture Securities may be modified without the consent of the Holders if such modification would not be deemed to affect their interests adversely in any material respect. In general, no modification of the terms of payment of principal and interest, no reduction of the percentage in principal amount of the Indenture Securities outstanding under such series required to consent to any supplemental indenture or waiver under the Indenture, no reduction of such percentage necessary for quorum and voting, and no modification of certain of the provisions in the Indenture relating to supplemental indentures, waivers of certain covenants and waivers of past defaults is effective against any Holder of Indenture Securities without his consent. "Tranche" means a group of Indenture Securities which are of the same series and have identical terms except as to principal amount and/or date of issuance. (See Indenture, Art. Twelve.) Concerning the Indenture Trustee. The Bank of New York, New York, New York is the trustee under the Indenture. BOOK-ENTRY SYSTEM For each issue of Debt Securities and New Preferred Stock subject to the book-entry system hereinafter described, a global security representing all of such issue will be issued to the Depository Trust Company, New York, New York ("DTC") or such other depository as may be subsequently designated ("Depository"), and registered in the name of CEDE & Co. (DTC's partnership nominee), or such other Depository or its nominee as may be subsequently designated. So long as the Depository, or its nominee, is the registered owner of an issue of the Debt Securities or New Preferred Stock, such Depository or such nominee, as the case may be, will be considered the owner of such New Preferred Stock or Debt Securities for all purposes under the Company's Restated Articles of Association, as amended (the "Restated Articles of Association") or the Mortgage or the Indenture, as the case may be, including notices and voting. Payments of (a) dividends and other amounts payable in connection with the New Preferred Stock and (b) principal of, and premium, if any, and interest on, such Debt Securities will be made to the Depository or its nominee, as the case may be, as the registered owner of such New Preferred Stock or Debt Securities. Except as set forth below, owners of beneficial interests in such New Preferred Stock or Debt Securities will not be entitled to have any such New Preferred Stock or Debt Securities registered in their names, will not receive or be entitled to receive physical delivery of such New Preferred Stock or Debt Securities and will not be considered the owners of such New Preferred Stock or Debt Securities under the Restated Articles of Association, the Mortgage or the Indenture. Accordingly, each person holding a beneficial interest in such New Preferred Stock or Debt Security must rely on the procedures of the Depository and, if such person is not a Direct Participant (as hereinafter defined), on procedures of the Direct Participant through which such person holds its interest, to exercise any of the rights of the registered owner of such New Preferred Stock or Debt Security. The following nine paragraphs are based solely on information furnished by DTC: DTC is a limited-purpose trust company organized under the New York Banking Law, a "banking organization" within the meaning of the New York Banking Law, a member of the Federal Reserve System, a "clearing corporation" within the meaning of the New York Uniform Commercial Code, and a "clearing agency" registered pursuant to the provisions of Section 17A of the Exchange Act. DTC holds securities that its participants ("Participants") deposit with DTC. DTC also facilitates the settlement among Participants of securities transactions, such as transfer and pledges, in deposited securities through electronic computerized book- entry changes in Participants' accounts, thereby eliminating the need for physical movement of securities certificates. Direct Participants include securities brokers and dealers, banks, trust companies, clearing corporations, and certain other organizations ("Direct Participants"). DTC is owned by a number of its Direct Participants and by The New York Stock Exchange, Inc., the American Stock Exchange, Inc., and the National Association of Securities Dealers, Inc. Access to the DTC system is also available to others such as securities brokers and dealers, banks, and trust companies that clear through or maintain a custodial relationship with a Direct Participant, either directly or indirectly ("Indirect Participants"). The rules applicable to DTC and its Participants are on file with the Commission. Purchases of the New Preferred Stock or the Debt Securities under the DTC system must be made by or through Direct Participants, which will receive a credit for the New Preferred Stock or the Debt Securities on DTC's records. The ownership interest of each actual purchaser of each share of New Preferred Stock or Debt Security ("Beneficial Owner") is in turn to be recorded on the Direct and Indirect Participants' records. Beneficial Owners will not receive written confirmation from DTC of their purchase, but Beneficial Owners are expected to receive written confirmation providing details of the transaction, as well as periodic statements of their holdings, from the Direct and Indirect Participant through which the Beneficial Owner entered into the transaction. Transfers of ownership interests in the New Preferred Stock or the Debt Securities are to be accomplished by entries made on the books of Participants acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing their ownership interests in the New Preferred Stock or the Debt Securities, except in the event that use of the book-entry system for the New Preferred Stock or the Debt Securities is discontinued. To facilitate subsequent transfers, all New Preferred Stock or Debt Securities deposited by Participants with DTC are registered in the name of CEDE & Co. The deposit of New Preferred Stock or Debt Securities with DTC and their registration in the name of CEDE & Co. effect no change in beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the New Preferred Stock or Debt Securities; DTC's records reflect only the identity of the Direct Participants to whose accounts such New Preferred Stock or Debt Securities are credited, which may or may not be the Beneficial Owners. The Participants will remain responsible for keeping account of their holdings on behalf of their customers. Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial Owners will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time. If the New Preferred Stock or Debt Securities of any issue are redeemable prior to the redemption date or maturity date, redemption notices shall be sent to CEDE & Co. If less than all of the New Preferred Stock or Debt Securities of any issue are being redeemed, DTC's practice is to determine by lot the amount of the interest of each Direct Participant in such issue to be redeemed. Neither DTC nor CEDE & Co. will consent or vote with respect to the New Preferred Stock or Debt Securities. Under its usual procedures, DTC mails an Omnibus Proxy to the Company as soon as possible after the record date. The Omnibus Proxy assigns CEDE & Co.'s consenting or voting rights to those Direct Participants to whose accounts the New Preferred Stock or Debt Securities are credited on the record date (identified in a listing attached to the Omnibus Proxy). Dividends and other amounts payable on the New Preferred Stock and principal and interest payments on the Debt Securities will be made to DTC. DTC's practice is to credit Direct Participants' accounts on the date on which the dividend, interest or other payment is payable in accordance with their respective holdings shown on DTC's records, unless DTC has reason to believe that it will not receive payment on such payment date. Payments by Participants to Beneficial Owners will be governed by standing instructions and customary practices, as is the case with securities held for the accounts of customers in bearer form or registered in "street name", and will be the responsibility of such Participant and not of DTC, the Trustee or the Unsecured Trustee, as the case may be, or the Company, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of dividends, principal, interest and other payments to DTC is the responsibility of the Company and the Trustee or the Unsecured Trustee, as the case may be. Disbursement of such payments to Direct Participants shall be the responsibility of DTC, and disbursement of such payments to the Beneficial Owners shall be the responsibility of Direct and Indirect Participants. DTC may discontinue providing services as securities depository with respect to the New Preferred Stock or Debt Securities at any time by giving notice to the Company and the Trustee or the Unsecured Trustee, as the case may be. Under such circumstances, in the event that a successor securities depository is not obtained, New Preferred Stock or Debt Securities in certificated form are required to be printed and delivered. The Company may decide to discontinue use of the system of book- entry transfers through DTC (or a successor securities depository). In that event, New Preferred Stock or Debt Securities in certificated form will be printed and delivered. None of the Company or the Trustee or the Unsecured Trustee will have any responsibility or liability for any aspect of the records relating to or payments made on account of beneficial interests in the New Preferred Stock or Debt Securities or for maintaining, supervising or reviewing any records relating to such beneficial interests. DESCRIPTION OF NEW PREFERRED STOCK The following is a summary of certain rights and privileges and restrictions on the New Preferred Stock. This summary does not purport to be complete. Reference is made to the Restated Articles of Association, as amended, and the Bylaws of the Company, filed as exhibits to the Registration Statement, for complete statements. The following statements are qualified in their entirety by such references. General. The Restated Articles of Association of the Company authorize the issuance of Common Stock, Preferred Stock, $100 par value (the "Preferred Stock") and Preference Stock, $100 par value (the "Preference Stock"), which ranks junior to Preferred Stock in respect of dividends and amounts payable upon liquidation, dissolution or winding up of the Company. As of June 30, 1996, there were issued and outstanding 3,000 shares of Preferred Stock, Class B, 5,100 shares of Preferred Stock, Class C and 11,200 shares of Series 1 and 70,000 shares of Series 3, Preferred Stock, Class D. No shares of Preference Stock have been issued. Of the Company's authorized Preferred Stock, the Company's Restated Articles of Association provide for 200,000 shares of New Preferred Stock, none of which has been issued as of the date hereof. Shares of the New Preferred Stock may be issued from time to time, in one or more series, as authorized by the Board of Directors of the Company. The New Preferred Stock will, when issued, be fully paid and non-assessible and will have no preemptive rights. Terms. Reference is made to the Prospectus Supplement or Supplements for each series of the New Preferred Stock for the following terms, among others, of the New Preferred Stock offered thereby: (1) the designation of such New Preferred Stock; (2) the number of shares of such New Preferred Stock offered, the liquidation preference per share and the offering price of such Preferred Stock; (3) the dividend rate(s) or method(s) of calculation thereof applicable to such New Preferred Stock; (4) the provision for a sinking fund, if any, for such New Preferred Stock; (5) the provision for redemption, if applicable, for such New Preferred Stock; (6) the terms and conditions, if applicable, upon which such New Preferred Stock will be convertible into Common Stock, including the conversion price (or manner of calculation) thereof; (8) any other specific terms, preferences, rights, limitations or restrictions of such New Preferred Stock; (9) any listing of such New Preferred Stock on any Securities Exchange; and (10) the provision for all or any portion of shares of such New Preferred Stock to be issued to a designated depository. The following statements with respect to the Company's New Preferred Stock are summaries of certain provisions of the Company's Restated Articles of Association. Dividend Rights. The holders of the New Preferred Stock will be entitled to receive, when and as declared by the Board of Directors, out of any assets of the Company available for dividends, dividends at such rates as may be determined by the Board of Directors of the Company (and set forth in the applicable Prospectus Supplement), payable quarterly on the first days of March, June, September and December in each year, cumulative from the date of first issuance. Dividends in full shall not be paid or set apart for payment on shares of any class of Preferred Stock for any dividend period unless dividends in full have been or are contemporaneously paid or set apart for payment on all outstanding shares of all classes of Preferred Stock for such dividend periods and all prior dividend periods. When the specified dividends are not paid in full on all classes of Preferred Stock, the shares of each class of Preferred Stock shall share ratably in the payment of dividends, including accumulations, if any, in accordance with the sums which would be payable on said shares if all dividends were paid in full. There are no limitations in any indentures or other agreements on the payment of dividends on the Preferred Stock. No dividends shall be declared or paid upon or set apart for any security junior to the New Preferred Stock in respect of dividends and amounts payable upon any liquidation, dissolution or winding up of the Company ("Junior Securities") nor any sums applied to the purchase, redemption or other retirement of any class of Junior Securities unless full dividends on all shares of Preferred Stock of all classes outstanding, and on all outstanding classes of securities senior to the Preferred Stock, for all past quarterly dividend periods shall have been paid or been declared and a sum sufficient for the payment thereof set apart and the full dividend for the then current quarterly dividend period shall have been or concurrently shall be declared. The amount of any deficiency for past dividend periods may be paid or declared and set apart at any time without reference to any quarterly dividend payment date. Unpaid accrued dividends on the Preferred Stock shall not bear interest. See "Description of New Common Stock--Dividend Restrictions" for additional restrictions on the payment of dividends on Common Stock and other Junior Securities. Liquidation Rights. In the event of any liquidation, dissolution or winding up of the Company, whether voluntary or involuntary, the holders of Preferred Stock shall be entitled to receive, for each share thereof, the par value thereof, plus in the case such liquidation, dissolution or winding up shall have been voluntary, an amount per share equal to the redemption premium that would then be payable to the holder thereof if such Preferred Stock were to be redeemed at the option of the Company, together, in each case, with accrued dividends (whether or not declared), before any distribution of the assets shall be made to the holders of any shares of any class of Junior Securities. The holders of Preferred Stock shall be entitled to no further participation in such distribution. Redemption Provisions. If so provided in the applicable Prospectus Supplement, the New Preferred Stock will be subject to mandatory redemption or redemption at the option of the Company, as a whole or in part, in each case upon terms, at the times and the redemption prices set forth in such Prospectus Supplement. If any dividends are in arrears on any shares of Preferred Stock or if a default exists in any sinking or purchase fund obligation provided for the benefit of any one or more class or series of Preferred Stock, the Company may not redeem or purchase any shares of Preferred Stock unless all of the outstanding Preferred Stock is redeemed or an offer to purchase on a comparable basis is made to the holders of all of the outstanding Preferred Stock, as applicable. Voting Rights. Holders the New Preferred Stock will not have any voting rights except as set forth below or as otherwise from time to time required by law or as indicated in the applicable Prospectus Supplement. With respect to any proposal upon which any series of the New Preferred Stock is entitled, as a series, to any vote, the holders of the shares of such series of New Preferred Stock are entitled to one vote for each share so held. The holders of Preferred Stock shall be entitled to vote, separately, as a single class, for the election of the smallest number of directors necessary to constitute a majority of the Board of Directors whenever and as often as dividends payable on any Preferred Stock outstanding shall be in arrears in an amount equivalent to or exceeding four (4) quarterly dividends, or for the election of two directors in the event of a default in any purchase or sinking fund provided for any one or more classes or series of Preferred Stock, which rights may be exercised at any annual meeting and at any special meeting of stockholders called for the purpose of electing directors, until such time as arrears in dividends on the Preferred Stock and the current dividend thereon shall have been paid or declared and set apart for payment, and any default in such purchase or sinking fund obligations shall have been remedied, whereupon all voting rights of the Preferred Stock as a result of such arrearage or default shall be divested from the Preferred Stock. Effective as of the date on which all currently outstanding shares of Classes B, C, and Class D, Series 1 and Series 3 Preferred Stock cease to be outstanding, the holders of Preferred Stock shall be entitled to vote, separately, as a single class, for the election of two (2) directors whenever and as often as dividends payable on any Preferred Stock outstanding shall be in arrears in an amount equivalent to or exceeding four (4) quarterly dividends, and for each subsequent election while such arrearage shall continue, that number of directors, not exceeding the smallest number of directors necessary to constitute a majority of the Board of Directors, equal to two (2) times the number of full years that such arrearage shall have continued, or for the election of two directors in the event of a default in any purchase or sinking fund provided for any one or more classes or series of Preferred Stock, which rights may be exercised at any annual meeting and at any special meeting of stockholders called for the purpose of electing directors, until such time as arrears in dividends on the Preferred Stock and the current dividend thereon shall have been paid or declared and set apart for payment, and any default in such purchase or sinking fund obligations shall have been remedied, whereupon all voting rights of the Preferred Stock as a result of such arrearage or default shall be divested from the Preferred Stock. The holders of Junior Securities, if any, voting separately as a class or classes, will be entitled to elect the remaining directors. In addition, the votes or consent of the holders of specified percentages of the Preferred Stock and Preference Stock are required as a condition to effecting various changes in the capital structure of the Company and certain other transactions. So long as any Preferred Stock is outstanding, (A) the Company shall not, without the consent of the holders of at least two-thirds of the aggregate number of shares of all classes of Preferred Stock entitled to vote thereon (i) create or authorize, or increase the authorized amount of any shares of any class of stock ranking as to dividends or assets prior to the Preferred Stock, or of any obligation or security convertible into stock ranking as to dividends or assets prior to the Preferred Stock; or (ii) amend, change or repeal any of the express terms of the Preferred Stock outstanding in any manner adverse to the holders thereof, except that, if such amendment, change or repeal is adverse to the holders of less than all classes and series of Preferred Stock, the consent of only the holders of two-thirds of the aggregate number of shares of the classes and series thereof entitled to vote thereon and so affected shall be required; or (iii) issue shares of Preferred Stock in addition to the Preferred Stock, Class A, originally issued, unless after giving effect to such additional shares (a) the Net Income of the Company Available for Dividends (defined below) for any period of twelve (12) consecutive calendar months within the fifteen (15) calendar months immediately preceding the calendar month within which such additional shares of stock are to be issued, shall have been at least two and one-half (2 1/2) times the aggregate annual dividend requirements upon the entire amount to be outstanding of Preferred Stock and of any stocks of the Company of any class ranking as to dividends prior to the Preferred Stock, (b) the Gross Income of the Company Available for Payment of Interest Charges (defined below) for any period of twelve (12) consecutive calendar months within the fifteen (15) calendar months immediately preceding the calendar month within which such additional shares of stock are to be issued, shall have been at least one and one- half (1 1/2) times the sum of (1) the aggregate annual interest charges on all indebtedness of the Company to be outstanding, and (2) the aggregate annual dividend requirements upon the entire amount to be outstanding of Preferred Stock and of any stocks of the Company of any class ranking as to dividends prior to the Preferred Stock, and (c) the Common Stock Equity (defined below) plus the aggregate of the capital allocable to all classes of Junior Securities other than the Common Stock shall not be less than the aggregate amount payable upon involuntary liquidation, dissolution or winding up of the Company to the holders of shares of all classes of Preferred Stock to be outstanding. In the foregoing computations, there shall be excluded (a) all indebtedness and all shares of Preferred Stock to be retired in connection with the issue of such additional shares, and (b) all interest charges on all indebtedness and, all dividend requirements on all shares of stock, to be retired in connection with the issue of such additional shares. The net earnings of any property which has been acquired by the Company during or after the period for which income is computed, or of any property which is to be acquired in connection with the issuance of any such additional shares, if capable of being separately determined or estimated, may be included on a pro forma basis in the foregoing computations; and if within or after the period for which income is computed, any substantial portion of the properties of the Company shall have been disposed of, the net earnings of such property, if capable of being separately determined or estimated, shall be excluded in the foregoing computations. (B) The Company shall not, without the consent of the holders of a majority of the aggregate number of shares of Preferred Stock entitled to vote thereon: (i) issue, create, guarantee or permit to exist any unsecured securities (whether notes, debentures of other evidences of indebtedness) evidencing indebtedness maturing more than one year from the date of issuance, creation or assumption thereof for any purpose, except for the purpose of refunding outstanding unsecured securities or effecting the retirement, by redemption or otherwise, of outstanding shares of the Preferred Stock or of a class of stock ranking prior thereto, if immediately after such issue, creation or assumption, the total principal amount of all such securities then to be issued would exceed twenty percent (20%) of the aggregate of (a) the total principal amount of all bonds and other securities representing secured indebtedness issued, created or assumed by the Company and then to be outstanding, and (b) the total of the capital and surplus (including premiums on capital stock) of the Company as then to be stated on its books; provided, that any unsecured securities issued under any authorization of holders of Preferred Stock (and any securities issued to refund the same) shall be excluded from the computation of the amount of unsecured securities which may be issued, created or assumed within the aforesaid twenty percent (20%) limitation; or (ii) merge or consolidate with or into any other corporation or corporations, provided that the consent or vote of the holders of the Preferred Stock as aforesaid shall not be required if (1) such consolidation and merger is with or into any public utility principally engaged in the distribution of gas or electricity in areas in the State of Vermont, and (2) if after giving effect to such merger or consolidation, and the issuance and assumption of all securities to be issued or assumed in connection with any such merger or consolidation, the ratio of the capital (including premiums) represented by all classes of Preferred Stock of the Company or Preferred Stock of any corporation resulting from such merger or consolidation then to be outstanding to the total sum of (a) the Common Stock Equity of the Company plus (b) the principal amount of all outstanding indebtedness of the resulting corporation maturing more than twelve (12) months after the date of issue or assumption thereof, and (c) the par value of or stated capital represented by the outstanding shares of all classes of stock of the resulting corporation other than common stock shall be equal to or greater than such ratio in the case of the Company prior to such merger or consolidation; provided that the provisions of this clause (ii) shall not apply to a purchase or other acquisition by the Company of franchise or assets of another corporation, in any manner which does not involve a merger or consolidation, and provided that the provisions of this sub-paragraph (ii) shall not be deemed to alter or affect the restrictive provisions of clause (A) or subparagraphs (i) or (iii) of this clause (B); or (iii) sell, lease or otherwise dispose of all or substantially all of its property to any person. Effective as of the date on which all currently outstanding shares of Classes B, C and Class D, Series 1 and Series 3, Preferred Stock cease to be outstanding, the provisions of (A) (iii) (a) and (B) (i) above will cease to be effective. For the purposes of the foregoing, the "Gross Income of the Company Available for Payment of Interest Charges" means the total operating revenues and other income of the Company less all proper deductions for operating expenses, taxes and other appropriate items, including provisions for maintenance, retirements and depreciations (but excluding interest charges and amortization of debt premium, discount and expense) determined in accordance with sound accounting practice. The "Net Income of the Company Available for Dividends" means the Gross Income of the Company Available for Payment of Interest Charges less interest charges, provided that no deduction or adjustment shall be made for the items of expense in connection with the redemption or retirement of any securities issued by the Company including any amount paid in excess of the principal amount or par value or stated value of securities redeemed or retired, or, in the event such redemption or retirement is effected with proceeds of the sale of other securities of the Company, interest or dividends on the securities redeemed or retired from the date on which the funds required for such redemption or retirement are deposited in trust for such purpose to the date of redemption or retirement period. "Common Stock Equity" shall mean the aggregate of the par value, or the stated capital represented by the outstanding Common Stock of the Company, plus the capital surplus and earned surplus of the Company and premiums on all capital stock of the Company less any accumulated or unpaid dividends on any outstanding Preferred Stock and any outstanding stock of any other class ranking as to dividends prior to the Preferred Stock. Transfer Agent and Registrar. The Transfer Agent and Registrar of the New Preferred Stock is Chase Mellon Shareholder Services L.L.C, Ridgefield Park, New Jersey. DESCRIPTION OF NEW COMMON STOCK The following is a summary of certain rights and privileges and restrictions on the Common Stock. This summary does not purport to be complete. Reference is made to the Restated Articles of Association and the Bylaws of the Company and the Mortgage, filed as exhibits to the Registration Statement, for complete statements. The following statements are qualified in their entirety by such references. General. The outstanding shares of Common Stock, $3.33 1/3 par value, of the Company are fully paid and nonassessable. The shares of the New Common Stock, upon payment of the purchase price, will be fully paid and nonassessable. Dividend Restrictions. No dividends may be paid on the Common Stock nor may the Company purchase any Common Stock unless all cumulative dividends on the Company's outstanding Preferred Stock have been paid or provided for, all Preferred Stock purchase-fund requirements have been satisfied, full dividends on any Preference Stock have been paid or provided for and the other restrictions summarized below have been complied with. In addition, so long as any shares of Preferred Stock are outstanding, the Company shall not pay any dividends on any shares of stock junior to the Preferred Stock or make any other distributions thereon or any expenditures for the purchase, redemption or other retirement for a consideration of such junior stock except from net income of the Corporation available for dividends on such junior stock accumulated subsequent to December 31, 1954 plus the sum of $150,000. The Mortgage provides that the Company shall not declare or pay any cash dividend on or make any other distribution in respect of its Common Stock, or, with certain exceptions, repurchase any capital stock of the Company if the aggregate amount so declared, paid, distributed or expended after December 31, 1992 would exceed the aggregate amount of net income of the Company available for dividends on its Common Stock accumulated after December 31, 1992, plus $18,500,000. As of December 31, 1995, the amount of retained earnings available for dividends on the Common Stock under this provision was $20,100,000. Voting Rights. The holders of the Common Stock have exclusive voting rights except as referred to below and as otherwise provided by law. See "DESCRIPTION OF NEW PREFERRED STOCK -- Voting Rights" for a description of voting rights afforded holders of Preferred Stock. Liquidation Rights. After satisfaction of the preferential liquidation rights of the Preferred Stock and any Preference Stock, the holders of Common Stock are entitled to share, ratably, in the distribution of all remaining assets of the Company. Holders of the Preferred Stock are entitled to receive $100 per share and accrued dividends on involuntary liquidation. Holders of any Preference Stock will be entitled to receive such amounts as determined by the Board of Directors at the time of issuance of such Stock. Preemptive Rights. The holders of the Common Stock have no preemptive rights. Anti-Greenmail, Fair Price and Business Judgment Provisions. Section 7.05 of the Company's Restated Articles of Association is intended to prevent so-called "greenmail". That Section prohibits the Company, in the absence of a special shareholder approval, from purchasing any of its outstanding shares of Common Stock at a price in excess of the fair market value of such shares from a beneficial owner of more than five percent of the Company's Common Stock (a "Related Person," as such term is more specifically defined in Section 7.06 of the Restated Articles of Association) who has owned such shares for less than two years, subject to certain limited exceptions. The special shareholder approval required by Section 7.05 is the greater of eighty percent of the voting power of the Company, or the sum of the number of shares owned by the Related Person plus a majority of the voting power of the Company not beneficially owned by the Related Person. Section 7.06 of the Company's Restated Articles of Association is a fair-price provision that is designed to provide reasonable assurance that any attempt to acquire the Company will be made only on terms that are fair to all shareholders. That Section requires that mergers and certain other Business Combinations (as defined below) involving the Company and a Related Person, unless approved by a majority of the Directors who are unaffiliated with such Related Person, must be approved by at least eighty percent of the voting power of the Company, as compared to the two-thirds vote required by Vermont law, and satisfy certain minimum-price, form-of-consideration and procedural requirements. Section 7.07 of the Company's Restated Articles of Association is a business judgment provision that requires that the Board of Directors, in evaluating any proposal for a merger or Business Combination involving the Company, take into consideration certain relevant factors, including the impact of any such transaction on the Company's suppliers, customers and employees, that might not otherwise be considered. For the purposes of Sections 7.06 and 7.07, a "Business Combination," in general, includes the following transactions: (1) a merger or consolidation of the Company or any subsidiary with a Related Person or certain affiliates or associates of the Related Person; (2) the sale or other disposition by the Company or a subsidiary of assets having an aggregate fair market value of $5,000,000 or more, or the use thereof in certain financial arrangements, if a Related Person is a party to the transaction; (3) the issuance or transfer (other than on a pro rata basis to all shareholders) of stock or other securities of the Company or of a subsidiary to a Related Person or affiliates or associates of the Related Person; (4) the adoption of any plan or proposal for the liquidation or dissolution of the Company proposed by or on behalf of or voted for or consented to by any Related Person or any affiliates or associates thereof; (5) any reclassification of securities, recapitalization, merger or consolidation with a subsidiary or other transaction that has the effect, directly or indirectly, of increasing the percentage of the outstanding stock of any class of the Company or a subsidiary owned by a Related Person or any affiliate or associate thereof; or (6) any similar transaction of similar purpose or effect or any agreement, contract or other arrangement providing for any one or more of the foregoing actions. The Restated Articles of Association provide that any amendment to Sections 7.06 and 7.07 must be approved by at least eighty percent of the voting power of the Company, unless such amendment has been recommended by a majority of the members of the Board of Directors who are not Related Persons, and who are unaffiliated with a Related Person and became Directors of the Company prior to the time that a Related Person became such. Staggered Board of Directors. The Company's By-laws provide that the members of the Company's Board of Directors are elected for three year terms, with one-third of the members of the Board of Directors elected each year. Transfer Agent and Registrar. The Transfer Agent and Registrar is Chase Mellon Shareholder Services L.L.C., Ridgefield Park, New Jersey. PLAN OF DISTRIBUTION The Company may sell the Securities (i) through underwriters; (ii) through dealers; (iii) directly to one or more institutional purchasers; or (iv) through agents. Securities may be sold outside the United States. An accompanying Prospectus Supplement or Supplements will set forth the terms of each offering of the Securities including the name or names of any underwriters, dealers, purchasers or agents, the purchase price of such Securities and the proceeds to the Company from such sale, any underwriting discounts and other items constituting underwriters' or agents' compensation, any initial public offering price, any discounts or concessions allowed or reallowed or paid to dealers and any securities exchanges on which such Securities may be listed. Any initial public offering price and any discounts or concessions allowed or reallowed or paid to dealers may be changed from time to time. Only firms named in the Prospectus Supplement are deemed to be underwriters, dealers or agents in connection with the Securities offered thereby. If underwriters are used in the sale, Securities 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. Unless otherwise set forth in the Prospectus Supplement, the obligations of the underwriters to purchase the Securities will be subject to certain conditions precedent, and the underwriters will be obligated to purchase all such Securities if any are purchased. Securities may be sold directly by the Company or through any firm designated by the Company from time to time, acting as principal or as agent. The Prospectus Supplement will set forth the name of any dealer or agent involved in the offer or sale of the Securities in respect of which the Prospectus Supplement is delivered and the price payable to the Company by such dealer or any commissions payable by the Company to such agent. Unless otherwise indicated in the Prospectus Supplement, any such agent will be acting on a reasonable efforts basis for the period of its appointment. Underwriters, dealers and agents 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, or to contribution with respect to payments for such liabilities which underwriters, dealers or agents may be required to make. Underwriters, dealers and agents may engage in transactions with or perform services for the Company in the ordinary course of business. The anticipated date of delivery of Securities will be as set forth in the Prospectus Supplement or Supplements relating to such offering. LEGAL OPINIONS AND EXPERTS The legality of the Securities offered hereby is being passed upon for the Company by Hunton & Williams, 200 Park Avenue, 43rd Floor, New York, New York 10166, special counsel for the Company, and by either Peter H. Zamore, Esq. General Counsel of the Company or Michael H. Lipson, Esq., Assistant General Counsel of the Company, and for the underwriters, dealers or agents by Reid & Priest LLP, 40 West 57th Street, New York, New York 10019. Hunton & Williams and Reid & Priest LLP will rely on the opinions of Peter H. Zamore,Esq. or Michael H. Lipson, Esq., as the case may be, as to matters of Vermont law. The audited consolidated financial statements and schedules of the Company for the period ended December 31, 1995, included in the Company's Annual Report on Form 10-K for the year ended December 31, 1995, which are incorporated in this Prospectus by reference, have been examined by Arthur Andersen LLP, independent certified public accountants, as set forth in their report dated January 29, 1996, with respect thereto, and are included in this Prospectus, through incorporation by reference, in reliance upon the report of such firm and their authority as experts in accounting and auditing. PART II INFORMATION NOT REQUIRED IN PROSPECTUS Item 16. Exhibits EXHIBIT INDEX Certain of the following exhibits are filed herewith. Certain other of the following exhibits have heretofore been filed with the Securities and Exchange Commission and are incorporated herein by reference. Exhibit Number *1(a) --- Form of Distribution Agreement relating to the New Bonds. *1(b) --- Form of Underwriting Agreement relating to the New Common Stock. *1(c) --- Form of Distribution Agreement relating to the Notes. +1(d) --- Form of Underwriting Agreement relating to the New Preferred Stock. 3-a --- Articles of Association as restated (Exhibit 3-a, Form 10-K, 1993, File No. 1-8291). 3-a-1 --- Amendment to 3-a above, dated as of May 20, 1993 (Exhibit 3- a-1, Form 10-K 1993, File No. 1-8291). 3-b --- By-laws, as amended (Exhibit 3-b, Form 10-K, 1993, File No. 1-8291). 4-a-1 --- Indenture of First Mortgage and Deed of Trust dated as of February 1, 1955 (Exhibit 4-b, Registration No. 2-27300). 4-a-2 --- First Supplemental Indenture dated as of April 1, 1961 (Exhibit 4-b-2, Registration No. 2-75293). 4-a-3 --- Second Supplemental Indenture dated as of January 1, 1966 (Exhibit 4-b-3, Registration No. 2-75293). 4-a-4 --- Third Supplemental Indenture dated as of July 1, 1968 (Exhibit 4-b-4, Registration No. 2-75293). 4-a-5 --- Fourth Supplemental Indenture dated as of October 1, 1969 (Exhibit 4-b-5, Registration No. 2-75293). 4-a-6 --- Fifth Supplemental Indenture dated as of December 1, 1973 (Exhibit 4-b-6, Registration No. 2-75293). 4-a-7 --- Seventh Supplemental Indenture dated as of August 1, 1976 (Exhibit 4-a-7, Registration No. 2-99643). 4-a-8 --- Eighth Supplemental Indenture dated as of December 1, 1979 (Exhibit 4-a-8, Registration No. 2-99643). 4-a-9 --- Ninth Supplemental Indenture dated as of July 15, 1985 (Exhibit 4-a-9, Registration No. 2-99643). 4-a-10 --- Tenth Supplemental Indenture dated as of June 15, 1989 (Exhibit 4-b-10, Form 10-K, 1989, File No. 1-8291). 4-a-11 --- Eleventh Supplemental Indenture dated as of September 1, 1990 (Exhibit 4-b-11, Form 10-Q, September 1990, File No. 1- 8291). 4-a-12 --- Twelfth Supplemental Indenture dated as of March 1, 1992 (Exhibit 4-b-12, Form 10-K, 1991, File No. 1-8291). 4-a-13 --- Thirteenth Supplemental Indenture dated as of March 1, 1992 (Exhibit 4-b-13, Form 10-K, 1991, File No. 1-8291). 4-a-14 --- Fourteenth Supplement Indenture dated as of November 1, 1993 (Exhibit 4-b-14, Form 10-K 1993, File No. 1-8291) 4-a-15 --- Fifteenth Supplemental Indenture dated as of November 1, 1993 (Exhibit 4-b-15, Form 10-K 1993, File No. 1-8291). *4-a-16 --- Sixteenth Supplemental Indenture dated December 1, 1995 (Exhibit 5-b-16, Form 10-K 1995, File No. 1-8291). *4-a-17 --- Revised form of Indenture (Exhibit 4-a-17, Form 10-Q, September 1995, File No. 1-8291). *5-a-1 --- Opinion of Hunton & Williams. *5-a-2 --- Opinion of Peter H. Zamore, Esq. +5-a-3 --- Opinion of Hunton & Williams. +5-a-4 --- Opinion of Michael H. Lipson, Esq. +12 --- Computation of Ratios. *23-a --- Consent of Hunton & Williams (included in their opinion filed as Exhibit 5-a-3). *23-b --- Consent of Michael H. Lipson, Esq. (included in his opinion filed as Exhibit 5-a-4). *23-d --- Consent of Arthur Andersen LLP (contained on Page 18 of this Registration Statement). +24-a --- Power of Attorney (Contained on Page 16 of the Registration Statement). *24-b --- Power of Attorney (Filed on Page 30 of this Post-Effective Amendment No. 1 to the Registration Statement). *25 --- Statement of Eligibility of the Corporate Mortgage Trustee on Form T-1. *25-b --- Statement of Eligibility of the Indenture Trustee on Form T-1. *Previously filed as a part of this registration statement. +Filed herewith. Item 17. Undertakings A. 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 registration 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 amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement; notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation 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) under the Securities Act of 1933 if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement, and (iii) to include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement; provided, however, that clauses (1)(i) and (1)(ii) do not apply if the registration statement is on Form S-3, Form S-8, or Form F- 3 and the information required to be included in a post-effective amendment by those clauses is contained in periodic reports filed by the registrant pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 that are incorporated 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 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; and (3) to remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. B. The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the registrant's annual report pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference in the registration statement 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. C. 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 provisions described under Item 15 of the registration statement, 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 Securities Act of 1933 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 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 question whether such indemnification by it is against public policy as expressed in the Securities Act of 1933 and will be governed by the final adjudication of such issue. 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 the requirements for filing on Form S-3 and has duly caused this Post-Effective Amendment No. 1 to this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of South Burlington, and State of Vermont on the 20th day of September, 1996. GREEN MOUNTAIN POWER CORPORATION (Registrant) By: /s/ Christopher L. Dutton Christopher L. Dutton, Vice President, Chief Financial Officer & Treasurer Pursuant to the requirements of the Securities Act of 1933, this Post-Effective Amendment No. 1 to the registration statement has been signed by the following persons in the capacities and on the date indicated. Signature Title Date President and Director September 20, 1996 /s/ Douglas G. Hyde (Principal Executive Officer) Douglas G. Hyde Vice President, Chief Financial September 20, 1996 /s/ Christopher L. Dutton Officer & Treasurer Christopher L. Dutton (Principal Financial Officer) /s/ Robert J. Griffin Manager of General Accounting September 20, 1996 Robert J. Griffin (Principal Accounting Officer) * Thomas P. Salmon Chairman of the Board * Robert E. Boardman } * Nordahl L. Brue } * William H. Bruett } * Merrill O. Burns } * Lorraine E. Chickering } Directors John V. Cleary } * Richard I. Fricke } Euclid A. Irving } * Martin L. Johnson } * Ruth W. Page } *By: /s/ C. L. Dutton September 20, 1996 C. L. Dutton (Attorney - in - Fact) EX-1 2 EXHIBIT 1(D) Exhibit 1(d) 000,000 Shares GREEN MOUNTAIN POWER CORPORATION Preferred Stock UNDERWRITING AGREEMENT ___________, 1996 As Representative of the Several Underwriters Dear Sirs: Green Mountain Power Corporation, a Vermont corporation (the "Company"), proposes to issue and sell an aggregate of 000,000 shares of its preferred stock, Class __, $100 par value per share (the "Shares"), to the several Underwriters named in Schedule I hereto (the "Underwriters"). The Shares are to be issued pursuant to a Statement of Resolution Establishing Preferred Stock, Class ___, of the Company (constituting an amendment to the Company's Restated Articles of Association, as amended), in substantially the form heretofore delivered to you and filed as an exhibit to the Registration Statement referred to below (the "Statement"). The Restated Articles of Association, as heretofore amended and to be so amended, are hereinafter referred to as the "Articles." The Shares will have the designations, preferences, powers and restrictions set forth in the Articles. No further amendment to the Articles will be made prior to the Closing Date hereinafter referred to without your approval, as Representative. The Company wishes to confirm as follows its agreement with you (the "Representative") and the other several Underwriters on whose behalf you are acting, in connection with the several purchases of the Shares by the Underwriters. 1. Registration Statement and Prospectus. The Company has prepared and filed with the Securities and Exchange Commission (the "Commission") in accordance with the provisions of the Securities Act of 1933, as amended, and the rules and regulations of the Commission thereunder (collectively, the "Act"), a registration statement on Form S-3 under the Act (the "registration statement"), including a prospectus. The term "Registration Statement" as used in this Agreement means the registration statement (including all financial schedules and exhibits), as amended by Amendment No. 1 and Post-Effective Amendment No. 1, in the form in which it is presently effective. The term "Prospectus" as used in this Agreement means the prospectus in the form included in the Registration Statement, as it shall be supplemented by a prospectus supplement with respect to the Shares in a filing with the Commission pursuant to Rule 424(b) under the Act. The term "Prepricing Prospectus" as used in this Agreement means the prospectus in the form included in the Registration Statement, as it has been supplemented by a preliminary prospectus supplement with respect to the Shares in a filing with the Commission pursuant to Rule 424(b) under the Act. Any reference in this Agreement to the registration statement, the Registration Statement, any Prepricing 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 under the Act, as of the date of the registration statement, the Registration Statement, any Prepricing Prospectus or the Prospectus, as the case may be, and any reference to any amendment or supplement to the registration statement, the Registration Statement, any Prepricing Prospectus or the Prospectus shall be deemed to refer to and include any document filed after such date under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), which, upon filing, is incorporated by reference therein, as required by paragraph (b) of Item 12 of Form S-3. As used herein, the term "Incorporated Documents" means the documents which at the time are incorporated by reference in the registration statement, the Registration Statement, any Prepricing Prospectus, the Prospectus, or any amendment or supplement thereto. 2. Agreement to Sell and Purchase. The Company hereby agrees, subject to all the terms and conditions set forth herein, to issue and sell to each Underwriter and, upon the basis of the representations, warranties and agreements of the Company herein contained and subject to all the terms and conditions set forth herein, each Underwriter agrees, severally and not jointly, to purchase from the Company, at the purchase price per Share set forth in Schedule I hereto (the "purchase price per Share"), the number of Shares set forth opposite the name of such Underwriter in Schedule I hereto (or such number of Shares increased as set forth in Section 10 hereof). 3. Terms of Public Offering. The Company has been advised by you that the Underwriters propose to make a public offering of their respective portions of the Shares as soon after the Registration Statement and this Agreement have become effective as in your judgment is advisable and initially to offer the Shares upon the terms set forth in the Prospectus. 4. Delivery of the Shares and Payment Therefor. Delivery to the Underwriters of and payment for the Shares shall be made at the office of , at 10:00 A.M., New York City time, on , 1996 (the "Closing Date"). The time or place of closing for the Shares and the Closing Date may be varied by agreement between you and the Company. Certificates for the Shares to be purchased hereunder shall be registered in such names and in such denominations as you shall request prior to 9:30 A.M., New York City time, on the third business day preceding the Closing Date. Such certificates shall be made available to you in New York City for inspection and packaging not later than 9:30 A.M., New York City time, on the business day next preceding the Closing Date. The certificates evidencing the Shares to be purchased hereunder shall be delivered to you on the Closing Date, against payment of the purchase price therefor immediately available funds. 5. Agreements of the Company. The Company agrees with the several Underwriters as follows: (a) If, at the time this Agreement is executed and delivered, it is necessary for the Registration Statement or a post-effective amendment thereto to be declared effective before the offering of the Shares may commence, the Company will endeavor to cause the Registration Statement or such post-effective amendment to become effective as soon as possible and will advise you promptly and, if requested by you, will confirm such advice in writing, when the Registration Statement or such post-effective amendment has become effective. (b) The Company will advise you promptly and, if requested by you, will confirm such advice in writing: (i) of any request by the Commission for amendment of or a supplement to the Registration Statement, any Prepricing Prospectus or the Prospectus or for additional information; (ii) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or of the suspension of qualification of the Shares for offering or sale in any jurisdiction or the initiation of any proceeding for such purpose; and (iii) within the period of time referred to in paragraph (f) below, of the happening of any event, which makes any statement of a material fact made in the Registration Statement or the Prospectus (as then amended or supplemented) untrue or which requires the making of any additions to or changes in the Registration Statement or the Prospectus (as then amended or supplemented) in order to state a material fact required by the Act to be stated therein or necessary in order to make the statements therein not misleading, or of the necessity to amend or supplement the Prospectus (as then amended or supplemented) to comply with the Act or any other law. If at any time the Commission shall issue any stop order suspending the effectiveness of the Registration Statement, the Company will make every reasonable effort to obtain the withdrawal of such order at the earliest possible time. (c) The Company will furnish to you, without charge (i) two signed copies of the registration statement as originally filed with the Commission and of each amendment thereto, including financial statements and all exhibits to the registration statement, (ii) such number of conformed copies of the registration statement as originally filed and of each amendment thereto, but without exhibits, as you reasonably may request, and (iii) two copies of the Incorporated Documents and the exhibits to the Incorporated Documents. (d) The Company will not file any amendment to the Registration Statement or make any amendment or supplement to the Prospectus or, prior to the end of the period of time referred to in the first sentence in subsection (f) below, file any document which, upon filing, becomes an Incorporated Document, of which you shall not previously have been advised or to which, after you shall have received a copy of the document proposed to be filed, you shall reasonably object. (e) Prior to the execution and delivery of this Agreement, the Company has delivered to you, without charge, in such quantities as you have requested, copies of each form of the Prepricing Prospectus. The Company consents to the use, in accordance with the provisions of the Act and with the securities or Blue Sky laws of the jurisdictions in which the Shares are offered by the several Underwriters and by dealers, prior to the date of the Prospectus, of each Prepricing Prospectus so furnished by the Company. (f) As soon after the execution and delivery of this Agreement as possible and thereafter from time to time for such period as in the opinion of counsel for the Underwriters a prospectus is required by the Act to be delivered in connection with sales by any Underwriter or dealer, the Company will expeditiously deliver to each Underwriter and each dealer, without charge, as many copies of the Prospectus (and of any amendment or supplement thereto) as you may request. The Company consents to the use of the Prospectus (and of any amendment or supplement thereto) in accordance with the provisions of the Act and with the securities or Blue Sky laws of the jurisdictions in which the Shares are offered by the several Underwriters and by all dealers to whom Shares may be sold, both in connection with the offering and sale of the Shares and for such period of time thereafter as the Prospectus is required by the Act to be delivered in connection with sales by any Underwriter or dealer. If during such period of time any event shall occur that in the judgment of the Company or in the opinion of counsel for the Underwriters is required to be set forth in the Prospectus (as then amended or supplemented) or should be set forth therein in order to make the statements therein, in the light of the circumstances under which they were made, not misleading, or if it is necessary to supplement or amend the Prospectus (or to file under the Exchange Act any document which, upon filing, becomes an Incorporated Document) in order to comply with the Act or any other law, the Company will forthwith prepare and, subject to the provisions of paragraph (d) above, file with the Commission an appropriate supplement or amendment thereto (or to such document), and will expeditiously furnish to the Underwriters and dealers a reasonable number of copies thereof. (g) The Company will cooperate with you and with counsel for the Underwriters in connection with the registration or qualification of the Shares for offering and sale by the several Underwriters and by dealers under the securities or Blue Sky laws of such jurisdictions as you may designate and will file such consents to service of process or other documents necessary or appropriate in order to effect such registration or qualification; provided that in no event shall the Company be obligated to qualify to do business in any jurisdiction where it is not now so qualified or to file any consent to service of process or to submit to any requirements which it deems unduly burdensome. (h) The Company will make generally available to its security holders a consolidated earnings statement, which need not be audited, covering a twelve-month period commencing after the effective date of the Registration Statement and ending not later than 15 months thereafter, as soon as practicable after the end of such period, which consolidated earnings statement shall satisfy the provisions of Section 11(a) of the Act. (i) During the period of five years hereafter, the Company will furnish to you (i) as soon as practicable, a copy of each report of the Company mailed to stockholders generally or filed with the Commission, and (ii) from time to time such other information concerning the Company as you may reasonably request. (j) The Company will apply the net proceeds from the sale of the Shares substantially in accordance with the description set forth in the Prospectus. (k) The Company will timely file the Prospectus pursuant to Rule 424(b) under the Act and will advise you of the time and manner of such filing. (l) The Company will not sell, contract to sell or otherwise dispose of any Shares of Preferred Stock (other than the Shares) pursuant to a public offering for a period of 90 days after the date of the Prospectus, without your prior written consent. (m) Promptly following the date hereof, the Company will cause the Statement to be filed with the Secretary of State of the State of Vermont. 6. Representations and Warranties of the Company. The Company represents and warrants to each Underwriter that: (a) Each Prepricing Prospectus filed pursuant to Rule 424 under the Act, complied when so filed in all material respects with the provisions of the Act. The Commission has not issued any order preventing or suspending the use of any Prepricing Prospectus. (b) The Company and the transactions contemplated by this Agreement meet the requirements for using Form S-3 under the Act. The Registration Statement and the Prospectus and any supplement or amendment thereto when filed with the Commission under Rule 424(b) under the Act, complied or will comply in all material respects with the provisions of the Act and will not at any such times 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, except that this representation and warranty does not apply to statements in or omissions from the Registration Statement or the Prospectus made in reliance upon and in conformity with information relating to any Underwriter furnished to the Company in writing by or on behalf of any Underwriter through you expressly for use therein. (c) The Incorporated Documents heretofore filed, when they were filed (or, if any amendment with respect to any such document was filed, when such amendment was filed), conformed in all material respects with the requirements of the Exchange Act and the rules and regulations thereunder, any further Incorporated Documents so filed will, when they are filed, conform in all material respects with the requirements of the Exchange Act and the rules and regulations thereunder; no such document when it was filed (or, if an amendment with respect to any such document was filed, when such amendment was filed), contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein not misleading; and no such further document, when it is filed, will contain an untrue statement of a material fact or will omit to state a material fact required to be stated therein or necessary in order to make the statements therein not misleading. (d) The Shares have been duly and validly authorized and, when (i) the Statement shall have been filed with the Secretary of State of the State of Vermont, and (ii) the Shares shall have been issued and delivered pursuant to this Agreement, the Shares will be duly and validly issued, fully paid and non-assessable and will conform to the description thereof contained in the Prospectus; no consent, approval, authorization or other order of any regulatory authority (other than the Public Service Board of the State of Vermont) is legally required for the issuance or sale of the Shares pursuant to this Agreement, except as may be required under the Act or state securities laws. (e) The Company is a corporation duly organized and validly existing in good standing under the laws of the State of Vermont, and has the corporate power and authority to own the property and to conduct the business which it now owns and conducts, and neither the character of the properties owned by it nor the nature of the business it transacts makes necessary its licensing or qualification as a foreign corporation in any state or jurisdiction other than Maine and Massachusetts. (f) Each of Green Mountain Propane Gas Company and Mountain Energy, Inc. (collectively, the "Subsidiaries") is a wholly- owned subsidiary of the Company and is a corporation duly organized and validly existing in good standing in the jurisdiction of its incorporation and has the corporate power and authority to own the property, and to conduct the business which it now owns and conducts. (g) Except as set forth in the Prospectus, there is not pending or, to the knowledge of the Company, threatened, any action, suit or proceeding, to which the Company or either of the Subsidiaries is a party, before or by any court or governmental agency or body, which might result in any material adverse change in the condition (financial or other), business, prospects, net worth or results of operations of the Company and the Subsidiaries taken as a whole, or might materially and adversely affect the properties or assets of the Company and the Subsidiaries taken as a whole; and there are no contracts or documents of the Company which would be required to be filed as exhibits to the Registration Statement by the Act which have not been so filed. (h) The consummation of the transactions herein contemplated and the fulfillment of the terms hereof will not result in a breach or violation of any of the terms or provisions of, or constitute a default under, any indenture, mortgage, deed of trust or other agreement or instrument to which the Company is a party or by which it or any of its property is bound, or of the Articles or by-laws of the Company, or any order, rule or regulation applicable to the Company or any of its property of any court or other governmental body. (i) The accountants, Arthur Andersen LLP, who have certified or shall certify the financial statements included or incorporated by reference in the Registration Statement and the Prospectus (or any amendment or supplement thereto) are independent public accountants as required by the Act. (j) The financial statements, together with related notes, included or incorporated by reference in the Registration Statement and the Prospectus (and any amendment or supplement thereto), present fairly the consolidated financial position and results of operations of the Company and the Subsidiaries on the basis stated in the Registration Statement at the respective dates or for the respective periods to which they apply; such statements and related notes have been prepared in accordance with generally accepted accounting principles consistently applied throughout the periods involved, except as disclosed therein. (k) Except as disclosed in the Registration Statement and the Prospectus (or any amendment or supplement thereto), subsequent to the respective dates as of which such information is given in the Registration Statement and the Prospectus (or any amendment or supplement thereto), neither the Company nor either of the Subsidiaries has incurred or will have incurred any material liability or obligation, direct or contingent, or has entered into any material transaction, not in the ordinary course of business, in either case which has resulted in a material adverse change in the condition (financial or other), net worth or results of operations of the Company and the Subsidiaries taken as a whole and there has not been any material change in the capital stock or long-term debt of the Company. (l) Each of the Company and the Subsidiaries owns or possesses all franchises, permits, patents, trademarks, service marks, trade names, copyrights, licenses and authorizations, and all other operating rights, consents, authorizations and orders (collectively, "Franchises"), and all rights with respect to the foregoing, necessary for the conduct of its business as now conducted; all of such Franchises are valid and subsisting and contain no unduly burdensome restriction, condition or limitation; and neither the Company nor either of the Subsidiaries is in default in any material respect in respect thereof. (m) The Company has timely filed in good faith with the Commission exemption statements under Section 3(a)(2) of the Public Utility Holding Company Act of 1935 and the Commission has not acted to terminate the exemption from such Act thereby obtained. 7. Indemnification and Contribution. (a) The Company agrees to indemnify and hold harmless you and each other Underwriter and each person, if any, who controls any Underwriter within the meaning of Section 15 of the Act or Section 20 of the Exchange Act from and against any and all losses, claims, damages, liabilities and expenses (including reasonable costs of investigation) arising out of or based upon any untrue statement or alleged untrue statement of a material fact contained in any Prepricing Prospectus or in the Registration Statement or the Prospectus or in any amendment or supplement thereto, or arising out of or based upon any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, except insofar as such losses, claims, damages, liabilities or expenses arise out of or are based upon any untrue statement or omission or alleged untrue statement or omission which has been made therein or omitted therefrom in reliance upon and in conformity with the information relating to such Underwriter furnished in writing to the Company by or on behalf of any Underwriter through you expressly for use in connection therewith; provided, however, that the indemnification contained in this paragraph (a) with respect to any Prepricing Prospectus shall not inure to the benefit of any Underwriter (or to the benefit of any person controlling such Underwriter) on account of any such loss, claim, damage, liability or expense arising from the sale of the Shares by such Underwriter to any person if a copy of the Prospectus shall not have been delivered or sent to such person within the time required by the Act, and the untrue statement or alleged untrue statement or omission or alleged omission of a material fact contained in such Prepricing Prospectus was corrected in the Prospectus, provided that the Company has delivered the Prospectus to the several Underwriters in requisite quantity on a timely basis to permit such delivery or sending. The foregoing indemnity agreement shall be in addition to any liability which the Company may otherwise have. (a) If any action, suit or proceeding shall be brought against any Underwriter or any person controlling any Underwriter in respect of which indemnity may be sought against the Company, such Underwriter or such controlling person shall promptly notify the Company and the Company shall assume the defense thereof, including the employment of counsel and payment of all fees and expenses. Such Underwriter or any such controlling person shall have the right to employ separate counsel in any such action, suit or proceeding and to participate in the defense thereof, but the fees and expenses of such counsel shall be at the expense of such Underwriter or such controlling person unless (i) the Company has agreed in writing to pay such fees and expenses, (ii) the Company has failed to assume the defense and employ counsel, or (iii) the named parties to any such action, suit or proceeding (including any impleaded parties) include both such Underwriter or such controlling person and the Company and such Underwriter or such controlling person shall have been advised by its counsel that representation of such indemnified party and the Company by the same counsel would be inappropriate under applicable standards of professional conduct (whether or not such representation by the same counsel has been proposed) due to actual or potential differing interests between them (in which case the Company shall not have the right to assume the defense of such action, suit or proceeding on behalf of such Underwriter or such controlling person). It is understood, however, that the Company shall, in connection with any one such action, suit or proceeding or separate but substantially similar or related actions, suits or proceedings in the same jurisdiction arising out of the same general allegations or circumstances, be liable for the reasonable fees and expenses of only one separate firm of attorneys (in addition to any local counsel) at any time for all such Underwriters and controlling persons not having actual or potential differing interests with you or among themselves, which firm shall be designated in writing by you, and that all such fees and expenses shall be reimbursed as they are incurred. The Company shall not be liable for any settlement of any such action, suit or proceeding effected without its written consent, but if settled with such written consent, or if there be a final judgment for the plaintiff in any such action, suit or proceeding, the Company agrees to indemnify and hold harmless any Underwriter, to the extent provided in the preceding paragraph, and any such controlling person from and against any loss, claim, damage, liability or expense by reason of such settlement or judgment. (b) Each Underwriter agrees, severally and not jointly, to indemnify and hold harmless the Company, its directors, its officers who sign the Registration Statement, and any person who controls the Company 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 with respect to information relating to such Underwriter furnished in writing by or on behalf of such Underwriter through you expressly for use in the Registration Statement, the Prospectus or any Prepricing Prospectus, or any amendment or supplement thereto. If any action, suit or proceeding shall be brought against the Company, any of its directors, any such officer, or any such controlling person based on the Registration Statement, the Prospectus or any Prepricing Prospectus, or any amendment or supplement thereto, and in respect of which indemnity may be sought against any Underwriter pursuant to this paragraph (c), such Underwriter shall have the rights and duties given to the Company by paragraph (b) above (except that if the Company shall have assumed the defense thereof such Underwriter shall not be required to do so, but may employ separate counsel therein and participate in the defense thereof, but the fees and expenses of such counsel shall be at such Underwriter's expense), and the Company, its directors, any such officer, and any such controlling person shall have the rights and duties given to the Underwriters by paragraph (b) above. The foregoing indemnity agreement shall be in addition to any liability which the Underwriters may otherwise have. (c) If the indemnification provided for in this Section 7 is unavailable to an indemnified party under paragraphs (a) or (c) hereof in respect of any losses, claims, damages, liabilities or expenses referred to therein, then an indemnifying party, in lieu of indemnifying such indemnified party, shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages, liabilities or expenses (i) in such proportion as is appropriate to reflect the relative benefits received by the Company on the one hand and the Underwriters on the other hand from the offering of the Shares, as well as other relevant equitable considerations, or (ii) if the allocation provided by clause (i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of the Company on the one hand and the Underwriters on the other in connection with the statements or omissions that resulted in such losses, claims, damages, liabilities or expenses, as well as any other relevant equitable considerations. The relative benefits received by the Company on the one hand and the Underwriters on the other shall be determined by reference to, among other things, the total net proceeds from the offering (before deducting expenses) received by the Company and the total underwriting discounts and commissions received by the Underwriters, in each case as set forth in the table on the cover page of the Prospectus. The relative fault of the Company on the one hand and the Underwriters on the other hand shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company on the one hand or by the Underwriters on the other hand and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. (d) The Company and the Underwriters agree that it would not be just and equitable if contribution pursuant to this Section 7 were determined by a pro rata allocation (even if the Underwriters were treated as one entity for such purpose) or by any other method of allocation that does not take account of the equitable considerations referred to in paragraph (d) above. The amount paid or payable by an indemnified party as a result of the losses, claims, damages, liabilities and expenses referred to in paragraph (d) above shall be deemed to include, subject to the limitations set forth above, any legal or other expenses reasonably incurred by such indemnified party in connection with investigating any claim or defending any such action, suit or proceeding. Notwithstanding the provisions of this Section 7, no Underwriter shall be required to contribute any amount in excess of the amount by which the total price of the Shares underwritten by it and distributed to the public exceeds the amount of any damages which such Underwriter has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. (e) No indemnifying party shall, without the prior written consent of the indemnified party, effect any settlement of any pending or threatened action, suit or proceeding in respect of which any indemnified party is or could have been a party and indemnity could have been sought hereunder by such indemnified party, unless such settlement includes an unconditional release of such indemnified party from all liability on claims that are the subject matter of such action, suit or proceeding. (f) All representations and warranties of the Company contained herein and in the certificate or certificates delivered pursuant to Section 8 and the indemnity agreements contained in this Section 7 shall remain operative and in full force and effect regardless of any investigation made by or on behalf of any Underwriter or controlling person, or by or on behalf of the Company or any officer, director or controlling person, or of any termination of this Agreement, and shall survive delivery of and payment for the Shares. 8. Conditions of Underwriters' Obligations. The several obligations of the Underwriters to purchase the Shares hereunder are subject to the following conditions: (a) If, at the time this Agreement is executed and delivered, it is necessary for the registration statement or a post-effective amendment thereto to be declared effective before the offering of the Shares may commence, the registration statement or such post-effective amendment shall have become effective not later than 5:30 P.M., New York City time, on the date hereof, or at such later date and time as shall be consented to in writing by you, and all filings, if any, required by Rule 424 under the Act shall have been timely made; no stop order suspending the effectiveness of the registration statement shall have been issued and no proceeding for that purpose shall have been instituted or, to the knowledge of the Company or any Underwriter, threatened by the Commission, and any request of the Commission for additional information (to be included in the registration statement or the prospectus or otherwise) shall have been complied with to your satisfaction. (b) Except as contemplated in the Prospectus, subsequent to the respective dates of which information is given in the Registration Statement and Prospectus, there shall not have been any material change in the capital stock, short-term debt or long-term debt of the Company, or any material adverse change in the condition (financial or other), net worth or results of operations of the Company and the Subsidiaries taken as a whole, which in your judgment, makes it impractical or inadvisable to offer or deliver the Shares on the terms and in the manner contemplated in the Prospectus. (c) You shall have received on the Closing Date, an opinion of Hunton & Williams, Special Counsel to the Company, dated the Closing Date and addressed to you, as Representative of the several Underwriters, to the effect that: (i) The Company has been duly incorporated and is validly existing as a corporation in good standing under the laws of the State of Vermont, and has all corporate power and authority necessary to own its properties and carry on the business which it is presently conducting as described in the Registration Statement; (ii) The Shares have been duly authorized; the Statement has been duly filed with the Secretary of State of the State of Vermont and has become effective; and, when issued by the Company and paid for in accordance with the terms hereof, the Shares will be validly issued and fully paid and non-assessable; (iii) The Shares conform to the statements concerning them in the Registration Statement and the Prospectus; (iv) No consent, approval, authorization or other order of any regulatory body or administrative agency or other governmental body (other than the Public Service Board of the State of Vermont, whose order consenting to and approving the issuance and sale of the Shares pursuant to this Agreement has been obtained and continues in full force and effect) is legally required for the valid issuance and sale of the Shares to the Underwriters under this Agreement, except such as have been obtained under the Act or as may be required under state securities laws; (v) The Registration Statement has become effective under the Act, and, to the best of the knowledge of such counsel, no stop order suspending the effectiveness of the Registration Statement has been issued and no proceedings for that purpose have been instituted or are pending or contemplated under the Act; any required filing of the Prospectus pursuant to Rule 424(b) has been made in accordance with Rule 424(b); the Registration Statement and the Prospectus and any amendment or supplement thereto comply as to form in all material respects with the requirements of the Act and the rules and regulations of the Commission thereunder (except that such counsel need express no opinion as to the financial statements and other financial and statistical data contained therein); each of the Incorporated Documents comply as to form in all material respects with the requirements of the Exchange Act and the rules and regulations of the Commission thereunder (except that such counsel need express no opinion as to the financial statements and other financial and statistical data contained therein); and the statements set forth in the Company's Annual Report of Form 10-K for the year ended December 31, 1995 with respect to the Public Utility Holding Company Act of 1935 under "State and Federal Regulation", as to matters of law and legal conclusions, are true and correct; (vi) They do not know of any legal or governmental proceedings pending or threatened to which the Company is a party, or of which property of the Company is the subject, of a character required to be disclosed in the Registration Statement which are not disclosed and properly described therein; and they do not know of any contracts or other documents of a character required to be filed as exhibits to the Registration Statement which are not so filed, or any contracts or other documents of a character required to be disclosed in the Registration Statement which are not disclosed and properly summarized therein; (vii) This Agreement has been duly authorized, executed and delivered by the Company; and the performance of this Agreement and the consummation of the transactions herein contemplated will not result in a breach of any of the terms or provisions of, or constitute a default under, the Articles or by-laws of the Company, or any indenture, mortgage, deed of trust or other agreement or instrument known to such counsel to which the Company is a party or by which it or its properties may be bound or affected; and (viii) Although counsel has not undertaken, except as otherwise indicated in their opinion, to determine independently, and does not assume any responsibility for, the accuracy or completeness of the statements in the Registration Statement, such counsel has participated in the preparation of the Registration Statement and the Prospectus, including review and discussion of the contents thereof (including review and discussion of the contents of all Incorporated Documents), and nothing has come to the attention of such counsel that has caused such counsel to believe that the Registration Statement, at the time the Registration Statement became effective, 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 or any amendment or supplement to the Prospectus, as of its respective date, and as of the Closing Date, contained or contains any untrue statement of a material fact or omitted 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 (it being understood that such counsel need express no opinion with respect to the financial statements and the notes thereto and the schedules and other financial and statistical data included in the Registration Statement or the Prospectus or any Incorporated Document). (d) You shall have received on the Closing Date, an opinion of Michael H. Lipson, Esq., Assistant General Counsel of the Company, dated the Closing Date and addressed to you, as Representative of the several Underwriters, with respect to the matters referred to in clauses (ii), (iii), (iv), (vi) and (vii) of the foregoing paragraph (c) and further to the effect that: (i) Each of the Company, Green Mountain Propane Gas Company and Mountain Energy, Inc. has been duly incorporated and is validly existing as a corporation in good standing under the laws of the State of Vermont, and has all corporate and other power and authority necessary to own its properties and carry on the business which it is presently conducting as described in the Registration Statement; (ii) The statements set forth in the Prospectus under "Description of Preferred Stock", as to matters of law and legal conclusions governed by Vermont law, are true and correct; (iii) The statements set forth in the Company's Annual Report on Form 10-K for the year ended December 31, 1995 under "State and Federal Regulation" (other than statements made with respect to the Public Utility Holding Company Act of 1935), under "Recent Rate Developments and under "Legal Proceedings", as to matters of law and legal conclusions, are true and correct; and (iv) such counsel has no reason to believe that the Registration Statement (including the Incorporated Documents) at the time the Registration Statement became effective, 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 Prospectus or any amendment or supplement to the Prospectus, as of its respective date, and as of the Closing Date, contained or contains any untrue statement of a material fact or omitted 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 (it being understood that such counsel need express no opinion with respect to the financial statements and the notes thereto and the schedules and other financial and statistical data included in the Registration Statement or the Prospectus or any Incorporated Document). (e) You shall have received on the Closing Date an opinion of Reid & Priest LLP, Counsel for the Underwriters, dated the Closing Date and addressed to you, as Representative of the several Underwriters, with respect to the matters referred to in clauses (ii),(v),(vii)(as to the first clause thereof) and (viii) of the foregoing paragraph (c) and such other related matters as you may request. In rendering their respective opinions as aforesaid, Special Counsel for the Company and Counsel for the Underwriters may rely upon the opinion of Michael H. Lipson, Esq. as to the laws of the State of Vermont. As to matters of New York law and Federal securities law, Michael H. Lipson, Esq., may rely upon the opinion of Hunton & Williams. (f) You shall have received letters addressed to you, as Representative of the several Underwriters, and dated the date hereof and the Closing Date from Arthur Andersen LLP, independent certified public accountants, substantially to the effect set forth in Exhibit I hereto. (g) You shall have received a certificate or certificates, dated the Closing Date, of the Chairman of the Board or the President or the Executive Vice President and the Vice President, Chief Financial Officer and Treasurer, or the Secretary of the Company to the effect that, to the best of their knowledge, based on a reasonable investigation: (i) No stop order suspending the effectiveness of the Registration Statement has been issued, and no proceedings for the purpose have been instituted or are pending or contemplated under the Act; (ii) Neither the Registration Statement nor the Prospectus, as the same may have been amended or supplemented, contains any untrue statement of a material fact or omits to state any material fact required to be stated therein or necessary to make the statements therein not misleading; and, since the effective date of the Registration Statement there has occurred no event required to be set forth in an amended or supplemented Prospectus which has not been so set forth; (iii) Except as contemplated in the Prospectus, subsequent to the respective dates as of which information is given in the Registration Statement and the Prospectus, neither the Company or either of the Subsidiaries has incurred any material liabilities or obligations, direct or contingent, or entered into any material transaction, not in the ordinary course of business, in either case which has resulted in a material adverse change in the condition (financial or other) or results of operations of the Company and of the Subsidiaries taken as a whole, and there has not been any material change in the capital stock or long-term debt of the Company; (iv) Subsequent to the respective dates as of which information is given in the Registration Statement and the Prospectus, the Company has not sustained any loss or damage to its properties which (considering them as a whole) is material, whether or not insured; and (v) The representations and warranties of the Company in this Agreement are true and correct, as if made on and as of the Closing Date; and the Company has complied with all the agreements and satisfied all the conditions on its part to be performed or satisfied at or prior to the Closing Date. (h) The Company shall not have failed at or prior to the Closing Date to have performed or complied with any of its agreements herein contained and required to be performed or complied with by it hereunder at or prior to the Closing Date. (i) The Shares shall have been assigned a rating of at least _____ and _____ by Standard & Poors Ratings Group ("S&P") and Moody's Investors Service, Inc. ("Moody's"), respectively. (j) There shall not have been any announcement by either S&P or Moody's that it (i) is downgrading its rating assigned to any debt securities or preferred stock of the Company, or (ii) is reviewing its rating assigned to any debt securities or preferred stock of the Company with a view to possible downgrading or with negative implications, or direction not determined. (k) The Company shall have furnished or caused to be furnished to you such further certificates and documents as you shall have reasonably requested. All such opinions, certificates, letters and other documents will be in compliance with the provisions hereof only if they are satisfactory in form and substance to you and your counsel. Any certificate or document signed by any officer of the Company and delivered to you, as Representative of the Underwriters, or to counsel for the Underwriters, shall be deemed a representation and warranty by the Company to each Underwriter as to the statements made therein. 9. Expenses. The Company agrees to pay, whether or not the transactions contemplated hereunder are consummated or this Agreement becomes effective or is terminated, all costs and expenses incident to the performance of its obligations under this Agreement, including the issue and delivery of the Shares by the Company, the fees and expenses of the Company's counsel and accountants, the costs and expenses incident to the preparation and filing under the Act of the Registration Statement (including all exhibits thereto) and the Prospectus, all fees and disbursements incurred by the Company or the Underwriters or their counsel in connection with the qualification of the Shares under the laws of various jurisdictions as provided in Section 5(g) hereof (including the cost of furnishing to the Underwriters memoranda relating thereto and the fees (not in excess of $5,000) and disbursements of counsel for the Underwriters), the cost of furnishing to the Underwriters copies of the Registration Statement, each Preliminary Prospectus and the Prospectus and each amended and supplemented prospectus and each prospectus prepared to permit compliance with Section 10(a)(3) of the Act, and the cost of printing this Agreement. The Company shall not, however, be required to pay for any of the Underwriters' expenses other than as hereinabove set forth; provided that, if this Agreement shall not be consummated because it is terminated by the Underwriters pursuant to Section 11 hereof, or by reason of any failure, refusal or inability on the part of the Company to perform any undertaking or satisfy any condition of this Agreement or to comply with any of the terms hereof on its part to performed, unless such failure to perform said undertaking or to satisfy said condition or to comply with said terms be due to the default or omission of any Underwriter, then and in any such case the Company shall reimburse the several Underwriters for all reasonable out-of-pocket expenses, including fees and disbursements of counsel (not in excess of $35,000), incurred in connection with investigating, marketing and proposing to market the Shares or in contemplation of performing their obligations hereunder; but the Company shall not in any event be liable to any of the several Underwriters for damages on account of loss of anticipated profits from the sale by them of the Shares. 10. Effective Date of Agreement. This Agreement shall become effective: (i) upon the execution and delivery hereof by the parties hereto; or (ii) if, at the time this Agreement is executed and delivered, it is necessary for the registration statement or a post-effective amendment thereto to be declared effective before the offering of the Shares may commence, when notification of the effectiveness of the registration statement or such post-effective amendment has been released by the Commission. Until such time as this Agreement shall have become effective, it may be terminated by the Company, by notifying you, or by you, as Representative of the several Underwriters, by notifying the Company. If any one or more of the Underwriters shall fail or refuse to purchase Shares which it or they are obligated to purchase hereunder on the Closing Date, and the aggregate number of Shares which such defaulting Underwriter or Underwriters are obligated but fail or refuse to purchase is not more than one-tenth of the aggregate number of Shares which the Underwriters are obligated to purchase on the Closing Date, each non-defaulting Underwriter shall be obligated, severally, in the proportion which the number of Shares set forth opposite its name in Schedule I hereto bears to the aggregate number of Shares set forth opposite the names of all non-defaulting Underwriters to purchase the Shares which such defaulting Underwriter or Underwriters are obligated, but fail or refuse, to purchase. If any one or more of the Underwriters shall fail or refuse to purchase Shares which it or they are obligated to purchase on the Closing Date and the aggregate number of Shares with respect to which such default occurs is more than one-tenth of the aggregate number of Shares which the Underwriters are obligated to purchase on the Closing Date and arrangements satisfactory to you and the Company for the purchase of such Shares by one or more non- defaulting Underwriters or other party or parties approved by you and the Company are not made within 36 hours after such default, this Agreement will terminate without liability on the part of any non-defaulting Underwriter or the Company. In any such case which does not result in termination of this Agreement, either you or the Company shall have the right to postpone the Closing Date, but in no event for longer than seven days, in order that the required changes, if any, in the Registration Statement and the Prospectus or any other documents or arrangements may be effected. Any action taken under this paragraph shall not relieve any defaulting Underwriter from liability in respect of any such default of any such Underwriter under this Agreement. The term "Underwriter" as used in this Agreement includes, for all purposes of this Agreement, any party not listed in Schedule I hereto who, with your approval and the approval of the Company, purchases Shares which a defaulting Underwriter is obligated, but fails or refuses, to purchase. Any notice under this Section 10 may be given by telegram, telecopy or telephone but shall be subsequently confirmed by letter. 11. Termination of Agreement. This Agreement shall be subject to termination in your absolute discretion, without liability on the part of any Underwriter to the Company by notice to the Company, if prior to the Closing Date, (i) trading in securities generally on the New York Stock Exchange shall have been suspended or materially limited, (ii) a general moratorium on commercial banking activities in New York shall have been declared by either federal or state authorities, or (iii) there shall have occurred any outbreak or escalation of hostilities or other international or domestic calamity, crisis or change in political, financial or economic conditions, the effect of which on the financial markets of the United States is such as to make it, in your judgment, impracticable or inadvisable to commence or continue the offering of the Shares at the offering price to the public set forth on the cover page of the Prospectus or to enforce contracts for the resale of the Shares by the Underwriters. Notice of such termination may be given to the Company by telegram, telecopy or telephone and shall be subsequently confirmed by letter. Any such termination shall be without liability of any party except that the provisions of Section 7 and Section 9 hereof shall at all times be effective and shall apply. 12. Information Furnished by the Underwriters. The statements set forth in the last paragraph on the cover page, the stabilization legend on the inside front cover, and the statements in the first and third paragraphs under the caption "Underwriting" in any Prepricing Prospectus and in the Prospectus, constitute the only information furnished by or on behalf of the Underwriters through you as such information is referred to in Sections 6(b) and 7 hereof. 13. Miscellaneous. Except as otherwise provided in Sections 5, 10 and 11 hereof, notice given pursuant to any provision of this Agreement shall be in writing and shall be delivered (i) if to the Company, at the office of the Company at 25 Green Mountain Drive, P.O. Box 850, South Burlington, Vermont 05402-0850, Attention: Christopher L. Dutton, Chief Financial Officer; or (ii) if to you, as Representative of the several Underwriters, care of , Attention: . This Agreement has been and is made solely for the benefit of the several Underwriters, the Company, its directors and officers, and the other controlling persons referred to in Section 7 hereof and their respective successors and assigns, to the extent provided herein, and no other person shall acquire or have any right under or by virtue of this Agreement. Neither the term "successor" nor the term "successors and assigns" as used in this Agreement shall include a purchaser from any Underwriter of any of the Shares in his status as such purchaser. This Agreement has been prepared upon the assumption that there will be more than one Underwriter purchasing the Shares. Consequently, if there should be only one Underwriter named in Schedule I hereto, this Agreement shall be read in that light. 14. Applicable Law; Counterparts. This Agreement shall be governed by and construed in accordance with the laws of the State of New York applicable to contracts made and to be performed within the State of New York. This Agreement may be signed in various counterparts which together constitute one and the same instrument. If signed in counterparts, this Agreement shall not become effective unless at least one counterpart hereof shall have been executed and delivered on behalf of each party hereto. Please confirm that the foregoing correctly sets forth the agreement between the Company and the several Underwriters. Very truly yours, GREEN MOUNTAIN POWER CORPORATION By:______________________________ Chief Financial Officer Confirmed as of the date first above mentioned on behalf of itself and the other several Underwriters named in Schedule I hereto. As Representative of the Several Underwriters By:___________________________ SCHEDULE I Number of Underwriter Shares _________ Total....._________ Purchase price per Share: $__________ EXHIBIT I (1) They are independent certified public accountants with respect to the Company within the meaning of the Act and the Rules and Regulations. (2) In their opinion, the consolidated financial statements and schedules audited by them and incorporated by reference in the Registration Statement comply as to form in all material respects with the applicable accounting requirements of the Act and the rules and regulations of the Commission thereunder. (3) On the basis of procedures referred to in such letter, including a reading of the latest available interim unaudited consolidated financial statements of the Company and the minutes of the Board of Directors and Stockholders of the Company, and inquiries of officers of the Company who have responsibility for financial and accounting matters (it being understood that the foregoing procedures do not constitute an examination made in accordance with generally accepted auditing standards and they would not necessarily reveal matters of significance with respect to the comments made in such letter, and accordingly, that Arthur Andersen make no representation as to the sufficiency of such procedures for the several Underwriters' purposes), nothing has come to their attention which caused them to believe that (A) the unaudited consolidated financial statements included in the quarterly reports on Form 10-Q incorporated by reference in the Registration Statement do not comply as to form in all material respects with the applicable accounting requirements of the Act and the rules and regulations of the Commission thereunder or are not fairly presented (except as otherwise indicated in the Prospectus) in conformity with generally accepted accounting principles applied on a basis substantially consistent with that of the audited consolidated financial statements included in the documents incorporated by reference in the Registration Statement, (B) the unaudited selected financial information with respect to the consolidated results of operations and financial position of the Company included in the Prospectus under the caption "Selected Financial Data" were not determined on a basis substantially consistent with the corresponding amounts in the audited statement of consolidated income, (C) at the date of the latest available interim unaudited consolidated balance sheet of the Company and at a subsequent specified date not more than five business days prior to the date of such letter, there was any change in the capital stock of the Company or long-term debt of the Company or any decrease in its net assets, in each case as compared with amounts shown in the latest consolidated balance sheet included incorporated by reference in the Prospectus or (D) for the period from the date of the latest financial statements incorporated by reference in the Prospectus to a subsequent specified date not more than five business days prior to the date of such letter, there were any decreases, as compared with the corresponding period in the preceding year, in operating revenues, net income or net income applicable to common stock; except in all instances for changes or decreases which the Prospectus discloses have occurred or may occur. (4) In addition to the audit referred to in their report(s) incorporated by reference in the Prospectus and the limited procedures, inspection of minute books, inquiries and other procedures referred to in paragraph (3) above, they have carried out certain specified procedures, not constituting an audit in accordance with generally accepted auditing standards, with respect to certain amounts, percentages and financial information specified by the Underwriters which are derived from the general accounting records of the Company and its subsidiaries, which appear in the Prospectus (excluding documents incorporated by reference), or in Part II of, or in exhibits and schedules to, the Registration Statement specified by the Underwriters or in documents incorporated by reference in the Prospectus specified by the Underwriters, and have compared certain of such amounts, percentages and financial information with the accounting records of the Company and its subsidiaries and have found them to be in agreement. EX-2 3 EXHIBIT 5-A-3 Exhibit 5-a-3 September 20, 1996 Green Mountain Power Corporation 25 Green Mountain Drive South Burlington VT 05403 Green Mountain Power Corporation $50,000,000 Shelf Registration Statement Common Stock, $3.33 1/3 Par Value, First Mortgage Bonds, Unsecured Notes and Preferred Stock, $100 Par Value Dear Sirs: We are acting as special counsel for Green Mountain Power Corporation, a Vermont corporation (the "Company"), in connection with the preparation and filing with the Securities and Exchange Commission (the "Commission") under the Securities Act of 1933, as amended (the "Act"), of Post-Effective Amendment No. 1 to the Company's Registration Statement on Form S-3 (the "Registration Statement") under File No. 33- 59383 relating to up to an aggregate amount of $50,000,000 of Common Stock, $3.33 1/3 par value (the "Common Stock"), and/or First Mortgage Bonds (the "Bonds") and/or Unsecured Notes (the "Notes", and, together with the Bonds, the "Debt Securities") and/or Preferred Stock, $100 par value (the "Preferred Stock") to be issued by the Company. As such counsel, we have: (a) reviewed the action heretofore taken by the Board of Directors of the Company in connection with the authorization of the issuance and sale of the Common Stock, the Debt Securities and the Preferred Stock and related matters; (b) reviewed the Registration Statement, as amended, which became effective on October 23, 1995, and Post-Effective Amendment No. 1 thereto (the "Amendment"), which Amendment we understand you propose to file with the Securities and Exchange Commission under the Securities Act of 1933 on the date hereof; (c) examined the opinion, dated the date hereof, addressed to you, of Michael Lipson, Assistant General Counsel for the Company, relating to the Preferred Stock; and (d) made such examination of law and examined originals, or copies, certified or otherwise authenticated to our satisfaction, of all such other corporate records, instruments, certificates of public officials and/or bodies, certificates of officers and representatives of the Company, and such other documents, and discussed with officers and representatives of the Company such questions of fact, as we have deemed necessary in order to render the opinion hereinafter expressed. Based on the foregoing, we are pleased to advise you that, in our opinion: 1. The Company is a corporation duly organized, incorporated and validly existing under the laws of the State of Vermont. 2. When (i) the Amendment has become effective, (ii) the Public Service Board of the State of Vermont has issued an order consenting to and approving the issue and sale of the Preferred Stock, (iii) the issuance and sale of the Preferred Stock have been duly authorized by appropriate corporate action, (iv) the Preferred Stock has been duly issued and sold and delivered and paid for as contemplated by the underwriting agreement to be executed by the Company with respect thereto, then the Preferred Stock will be validly issued, fully-paid and nonassessable. We hereby consent to: A. being named in the Registration Statement and in any amendment thereto under the heading "Legal Opinions and Experts"; B. the making in said Registration Statement and in any amendments thereto of the statements now appearing in said Registration Statement under the heading "Legal Opinions and Experts" insofar as they are applicable to us; and C. the filing of this opinion as an exhibit to the Registration Statement. We are members of the Bar of the State of New York and not of the State of Vermont and, in giving the foregoing opinion, we have relied upon the above-mentioned opinion of Michael Lipson as to all matters of Vermont law involved in the conclusions stated in our opinions. Very truly yours, /s/HUNTON & WILLIAMS EX-3 4 EXHIBIT 5-A-4 Exhibit 5-a-4 September 20, 1996 Green Mountain Power Corporation P.O. Box 850 25 Green Mountain Drive South Burlington VT 05402-0850 Green Mountain Power Corporation Post-Effective Amendment No. 1 to the Registration Statement Common Stock, $3.33 1/3 Par Value, First Mortgage Bonds, Unsecured Notes, Preferred Stock, $100 Par Value Dear Sirs: I am the Assistant General Counsel for Green Mountain Power Corporation, a Vermont corporation (the "Company"), and have acted as such in connection with the preparation and filing with the Securities and Exchange Commission (the "Commission") under the Securities Act of 1933, as amended (the "Act"), of Post-Effective Amendment No. 1 to the Company's Registration Statement on Form S-3, Registration No. 33-59383, (the "Registration Statement") relating to up to an aggregate amount of $50,000,000 of Common Stock, $3.33 1/3 par value (the "Common Stock"), and/or First Mortgage Bonds (the "Bonds"), and/or Unsecured Notes (the "Notes" and together with the Bonds, the "Debt Securities"), and/or Preferred Stock, $100 par value (the "Preferred Stock") (all of the foregoing being collectively referred to as the "Securities") to be issued by the Company. As such counsel, I have: (a) reviewed the action heretofore taken by the Board of Directors of the Company in connection with the authorization of the issuance and sale of the Preferred Stock and related matters; (b) reviewed Post-Effective Amendment No. 1 to the Registration Statement, which I understand you propose to file with the Securities and Exchange Commission under the Securities Act of 1933, as amended, on the date hereof; and (c) made such examination of law and examined originals, or copies, certified or otherwise authenticated to our satisfaction, of all such other corporate records, instruments, certificates of public officials and/or bodies, certificates or officers and representatives of the Company, and such other documents, and discussed with officers and representatives of the Company such questions of fact, as I have deemed necessary in order to render the opinion hereinafter expressed. Based on the foregoing, I am pleased to advise you that, in my opinion: 1. The Company is a corporation duly organized, incorporated and validly existing under the laws of the State of Vermont, and has all corporate and other power and authority necessary to own its properties and carry on the business which it is presently conducting. 2. When (i) Post-Effective Amendment No. 1 to the Registration Statement has become effective, (ii) the Public Service Board of the State of Vermont has issued an order consenting to and approving the issue and sale of the Preferred Stock, (iii) the issuance and sale of the Preferred Stock have been duly authorized by appropriate corporate action, (iv) the Preferred Stock has been duly issued and sold and delivered and paid for as contemplated by the underwriting agreement to be executed by the Company with respect thereto, then the Preferred Stock will be validly issued, fully-paid and nonassessable. I hereby consent to: A. being named in Post-Effective Amendment No. 1 to the Registration Statement and in any amendment thereto under the heading "Legal Opinions and Experts"; B. the making in Post-Effective Amendment No. 1 to the Registration Statement and in any amendments thereto of the statements now appearing in said Registration Statement under the heading "Legal Opinions and Experts" insofar as they are applicable to me; and C. the filing of this opinion as an exhibit to Post- Effective Amendment No. 1 to the Registration Statement. I am a member of the Bar of the State of Vermont and not of the State of New York and, in giving the foregoing opinion, I have relied upon the opinion of Hunton & Williams, counsel to the Company, as to all matters of New York and securities law involved in the conclusions stated in my opinion. I understand that a copy of this opinion is being delivered to Hunton & Williams, special counsel to the Company in connection with the registration of the Preferred Stock, who are also rendering an opinion to the Company relating to the matters referred to herein and that their opinion will be filed as an exhibit to the Post-Effective Amendment No. 1 to the Registration Statement. In rendering their opinion, Hunton & Williams are authorized to rely upon this opinion as to all matters of Vermont law involved in the conclusions expressed in their opinion. Very truly yours, /s/Michael H. Lipson Assistant General Counsel EX-4 5 EXHIBIT 12 Green Mountain Power Corporation Computation of Ratio of Earnings to Fixed Charges and Preferred Stock Dividends Exhibit 12
Twelve Months Year Ended December 31, Ended --------------------------------------------- June 30, 1996 1995 1994 1993 1992 1991 ------------------- --------------------------------------------- (Dollars in thousands) Earnings: Net earnings $11,618 $12,013 $11,052 $10,764 $12,296 $10,260 Income taxes 6,003 6,310 5,917 5,922 6,451 5,795 Fixed charges 9,811 9,777 9,777 9,370 9,332 9,303 ------------------- --------------------------------------------- Total earnings $27,432 $28,100 $26,746 $26,056 $28,079 $25,358 =================== ============================================= Fixed Charges: Interest $8,175 $8,047 $8,043 $7,590 $7,518 $7,517 Amortization of debt premium and discount 136 140 138 102 85 48 Interest portion of rental payments 1,500 1,590 1,596 1,678 1,729 1,738 ------------------- --------------------------------------------- Total fixed charges $9,811 $9,777 $9,777 $9,370 $9,332 $9,303 =================== ============================================= Preferred stock dividend requirements $1,133 $1,145 $1,179 $1,204 $1,234 $1,265 =================== ============================================= Ratio of earnings to fixed charges 2.80 2.87 2.74 2.78 3.01 2.73 =================== ============================================= Ratio of earnings to fixed charges and preferred stock dividends 2.51 2.57 2.44 2.46 2.66 2.40 =================== =============================================
EX-5 6 EXHIBIT 24-B Exhibit 24-b POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS, that each of the undersigned in his or her capacity as a Director of Green Mountain Power Corporation (the "Company"), does hereby appoint Douglas G. Hyde, Esq., C. L. Dutton, Esq. and P.H. Zamore, Esq., and each of them severally, his or her true and lawful attorneys or attorney to execute in his or her name, place and stead, in his or her capacity as a Director or officer or both, as the case may be, of said Company, this Post-Effective Amendment to the Registration Statement and any and all amendments and post-effective amendments thereto and all instruments necessary or incidental in connection therewith, and to file the same with the Securities and Exchange Commission. Each of said attorneys shall have power to act hereunder with or without any other of said attorneys, and shall have full power of substitution and resubstitution. Each of said attorneys shall have full power and authority to do and perform in the name and on behalf of each of the undersigned, in any and all capacities, every act whatsoever requisite or necessary to be done in the premises, as fully and to all intents and purposes as each of the undersigned might or could do in person, and each of the undersigned hereby ratifies and approves of the act of said attorneys and each of them. Signature Date /s/Robert E. Boardman September 16, 1996 Robert E. Boardman /s/Nordahl L. Brue September 19, 1996 Nordahl L. Brue, Esq. /s/William H. Bruett September 16, 1996 William H. Bruett /s/Merrill O. Burns September 16, 1996 Merrill O. Burns /s/Lorraine E. Chickering September 17, 1996 Lorraine E. Chickering September _____, 1996 John V. Cleary /s/Richard I. Fricke September 14, 1996 Richard I. Fricke /s/Douglas G. Hyde September 13, 1996 Douglas G. Hyde September _____, 1996 Euclid A. Irving /s/Martin L. Johnson September 16, 1996 Martin L. Johnson /s/Ruth W. Page September 14, 1996 Ruth W. Page /s/Thomas P. Salmon September 17, 1996 Thomas P. Salmon, Esq. -----END PRIVACY-ENHANCED MESSAGE-----