Post-Effective Amendment to a U-1 — Form U-1
Filing Table of Contents
Document/Exhibit Description Pages Size
1: POS AMC Pleasants Post-Effective Amendment No. 7 3 9K
2: EX-99 Maryland Application 13 29K
6: EX-99 Maryland Order 2 12K
3: EX-99 Ohio Application 17 57K
7: EX-99 Ohio Order 3 14K
8: EX-99 Pennsylvania Order 2 11K
4: EX-99 Pennsylvania Securities Certificate (Application) 39 111K
5: EX-99 Virginia Application 7 25K
9: EX-99 Virginia Order 2 11K
EX-99 — Virginia Application
| EX-99 | 1st Page of 7 | TOC | ↑Top | Previous | Next | ↓Bottom | Just 1st |
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Exhibit D-4(a)
BEFORE THE
STATE CORPORATION COMMISSION
OF VIRGINIA
COMMONWEALTH OF VIRGINIA, ex rel.
STATE CORPORATION COMMISSION
In re: Application of The Potomac
Edison Company for authority
to issue not more than $195 000 000
of additional first mortgage bonds, CASE NO. ______________
not more than $21 000 000 of pollution
control notes and not more than
$15 000 000 of preferred stock
APPLICATION FOR AUTHORITY TO ISSUE SECURITIES
The Potomac Edison Company ("Applicant"), a Maryland and Virginia
corporation, respectfully shows:
1. Applicant is a public service company and the primary supplier
of electricity to portions of the states of Virginia, Maryland
and West Virginia.
2. After January 1, 1994 and prior to December 31, 1995,
Applicant proposes to issue for cash to the general public, an
aggregate principal amount of not more than $195 000 000 of
First Mortgage Bonds (the "Bonds"). The Bonds shall be issued
in one or more new series, each such series to have a single
maturity of not more than thirty (30) years. Applicant
anticipates that the Bonds will be issued through underwriters
after competitive bidding. However, in order to deal with
market conditions as they exist at the time, Applicant
requests the flexibility to issue the Bonds through
negotiation with underwriters or through private placement
with institutional investors if such procedures are deemed
more economic.
3. It is difficult to determine, under present bond market
conditions, whether it would be more advantageous to Applicant
to sell bonds having a 30-year or some shorter maturity.
Applicant desires to have available sufficient flexibility to
adjust its financing program to developments in the markets
for long-term debt securities when and as they occur, in order
to obtain the best possible price or prices and interest rate
or rates for the Bonds.
4. It is proposed that Applicant decide on the number of series
and the maturity of the Bonds at a later time and notify
prospective purchasing underwriters as required by the
Securities and Exchange Commission ("SEC").
5. The Bonds are to be issued under the Indenture as of
October 1, 1944, between Applicant and Chemical Bank, as
Trustee, and Thomas J. Foley, as Individual Trustee, as
heretofore supplemented and amended, and under an indenture
supplemental thereto. The Bonds are to bear interest payable
semi-annually. A copy of the Supplemental Indenture, as
executed, will be filed as part of the final report of action
made to the Commission. The bonds will be redeemable in whole
or in part at any time or from time to time (except that prior
to ten (10) years (or such other date as the Company may
choose) after the first day of the month in which the bonds
are issued, they may not be redeemed directly or indirectly
with or in anticipation of moneys borrowed at a cost of money
to Applicant less than the cost of money to it in respect of
such Bonds) at the option of Applicant, after notice, upon
payment of their principal amount plus accrued unpaid
interest, together with a premium that will initially be no
greater than the interest rate and will decline to zero at or
before maturity. The bonds may carry a 10-year (or such other
date as the Company may choose) no call provision.
6. Applicant may elect to sell the Bonds through an alternative
competitive bidding procedure consistent with SEC Rule 50 as
described in SEC Release No. 35-22623 of September 2, 1982.
The Bonds will be registered with the SEC pursuant to a Rule
415 "shelf registration." The price or prices to be paid to
Applicant and the interest rate or rates will be determined by
such competitive bidding. The interest rate or rates, the
price or prices to Applicant and the public offering price or
prices, if any, of the Bonds, and the prices at which the
Bonds may be redeemed, are to be determined, and the award of
the Bonds is to be made, in accordance with the bid which
offers the lowest cost of money to Applicant. In the event,
however, that market or other conditions make competitive
bidding impracticable or undesirable, Applicant proposes to
negotiate with underwriters for the purchase of the Bonds or
privately place the bonds with institutional investors. Under
such circumstances the interest rate or rates and the price or
prices to be paid Applicant will be determined by such
negotiations.
7. Applicant will use the net proceeds of the Bonds to be issued
for the refunding prior to their respective maturities of $80
million aggregate principal amount of its First Mortgage
Bonds, 9.625% Series issued 1990, due 2020 and $50 million
aggregate principal amount of its First Mortgage Bonds, 8.875%
Series issued 1991, due 2021 through a non-coercive tender
offer if economically justified; and to refund prior to
maturity, after June 1, 1994, $65 million aggregate principal
amount of its First Mortgage Bonds, 9.25% Series issued 1989,
due 2019 if economically justified.
8. Applicant also proposes to enter into a transaction after
January 1, 1994 and prior to December 31, 1995, involving the
refinancing of an issue of tax-exempt revenue bonds (the
"Series B Bonds"), if economically justified, issued by the
Pleasants County Commission of West Virginia (the "County
Commission"), the proceeds of which were used to finance the
cost of installation of certain air pollution control
equipment improvement at the Pleasants Generating Station.
The pollution control equipment was installed in order to meet
West Virginia State and Federal air quality standards as to
particulate emissions. This Commission, by its Order dated
July 14, 1978 in Case No. A-670, previously authorized
Applicant's issuance of up to $21 million of pollution control
notes concerning the above referenced Series B Bonds.
The Series B Bonds were issued August 1, 1978 by
Pleasants County ($21 000 000), bear interest at the rate of
7.30% per annum, mature on August 1, 2008, and are subject to
optional redemption at 100-1/2% of the principal amount plus
accrued interest. The optional redemption price changes to
100% on August 1, 1994 and thereafter. It is expected that
Pleasants County will issue a new series of bonds (the
"Series C Bonds") for the purpose of providing a portion of
the funds required to redeem the County's Series B Bonds.
Pleasants County's new Series C Bonds will be in an aggregate
principal amount equal to the aggregate principal amount of
the County's Series B Bonds outstanding at the time of the
refinancing, which is the maximum amount permitted by the
Internal Revenue Code for a refinancing of this type. The new
Series C Bonds will be sold at such times, in such principal
amount, at such interest rates, and for such prices as shall
be approved by Applicant. The timing of any such refinancing
will depend on a determination by Applicant of market
conditions which are expected to prevail through the maturity
of the Series B Bonds.
Applicant will deliver concurrently with the issuance of
the Series C Bonds, its non-negotiable Pollution Control Note
corresponding to such series of Bonds in respect of principal
amount, interest rates and redemption provisions and having
installments of principal corresponding to any mandatory
sinking fund payments and stated maturities. Payments on such
Note will be made to the Trustee and applied by the Trustee to
pay the maturing principal and redemption price of and
interest and other costs on the Series C Bonds as the same
become due.
9. Title to the pollution control equipment will remain with
Applicant subject to the second lien granted by Applicant on
the equipment to the County Commission in accordance with the
terms of the Pollution Control Financing Agreement, the Trust
Indenture and the Security Agreement reviewed and approved by
the Commission in Case No. A-670.
10. It is expected that the County Commission will engage Goldman,
Sachs & Co., and any co-managers that may be desirable, for
the purpose of providing financial advice and underwriting the
sale of the Bonds. Applicant has been informed that the
County Commission has the legal authority to issue tax-exempt
revenue bonds in accordance with the documents and Potomac
understands that a legal opinion to that effect will be
delivered to appropriate parties at, or prior to, the closing.
The new Series C Bonds, which will be in registered form, will
bear interest semi-annually at a rate to be determined and
will be issued pursuant to the Trust Indenture. The Trust
Indenture provides for a mandatory redemption of the Bonds
under certain circumstances. In addition, the new Series C
Bonds will be subject to redemption at the option of the
County Commission, exercised at the direction of Applicant, in
accordance with the provisions contained in the form of Bond.
11. The proceeds of the sale of the Series B Bonds by the County
Commission were applied to purchase and complete construction
of the pollution control equipment. By virtue of title
retention provisions of the Purchase Agreement and Indenture,
the new Series C Bonds will be secured by a second lien on the
pollution control equipment owned by Applicant. The Trust
Indenture requires that such pollution control equipment be
free of any lien or encumbrance except for certain liens
permitted by the Purchase Agreement. The new Series C Bonds
will be issued pursuant to a supplemental indenture with
specific provisions to be determined at the time of issuance.
The supplemental indenture will also provide that all the
proceeds of the sale of the new Series C Bonds by the County
Commission must be applied to the cost of the refinancing of
the Series B Bonds.
Applicant and the other owners of the Pleasants
Generating Station will continue to have complete control of
the operation of the pollution control equipment and will be
responsible for its maintenance.
12. Applicant also proposes to issue, after January 1, 1994 and
prior to December 31, 1995, up to 150 000 additional shares of
its cumulative preferred stock, with a par value of up to $100
per share.
13. Applicant anticipates that the preferred stock would be issued
through underwriters after competitive bidding. However, in
order to deal with market conditions as they exist at the
time, Applicant requests the flexibility to issue the
preferred stock through negotiation with underwriters or
through private placement with institutional investors if such
procedures are deemed more economic.
14. The preferred stock would be redeemable in whole or in part at
any time or from time to time (except that prior to ten (10)
years (or such other date as the Company may choose) after
the first day of the month in which the preferred stock is
issued, such stock may not be redeemed directly or indirectly
with or in anticipation of monies borrowed at a cost of money
to Applicant less than the cost of money to it in respect of
such preferred stock) at the option of Applicant, after
notice, on payment of its principal amount plus accrued unpaid
interest, together with a premium that will initially be no
greater than the interest rate and will decline to zero at or
before maturity. The preferred stock may carry a 10-year (or
such other date as the Company may choose) no call provision.
15. Applicant anticipates selling the preferred stock through the
alternate competitive bidding procedures consistent with SEC
Rule 50 as described in SEC Release No. 35-22623 of
September 2, 1982 and SEC Rule 415 "shelf-registration". The
price or prices to be paid to Applicant and the dividend rate
or rates would be determined by such competitive bidding. The
dividend rate or rates, the price or prices to Applicant and
the public offering price or prices, if any, of the preferred
stock, and the prices at which the preferred stock may be
redeemed, are to be determined, and the award of the preferred
stock is to be made, in accordance with the bid which offers
the lowest cost of money to Applicant. In the event, however,
that market or other conditions make competitive bidding
impracticable or undesirable, Applicant proposes to negotiate
with underwriters for the purchase of the preferred stock or
privately place the preferred stock with institutional
investors. Under such circumstances the dividend rate or
rates and the price or prices to be paid Applicant will be
determined by such negotiations.
16. Applicant will use the proceeds of the preferred stock
proposed to be issued to redeem $5 million of $8.32 Cumulative
Preferred Stock, Series F and $10 million of $8.00 Cumulative
Preferred Stock, Series G, if economically justified.
17. The current financial statements of Applicant as of
September 30, 1993 are included as Exhibits A and B.
Applicant, therefore, prays that all requisite authorization under
the laws of Virginia be given for this proposed transaction.
THE POTOMAC EDISON COMPANY
J. D. LATIMER
J. D. Latimer
Vice President
ATTEST:
_______________________________
Secretary
PHILIP J. BRAY
Philip J. Bray, Esq.
The Potomac Edison Company Building
10435 Downsville Pike
Hagerstown, MD 21740-1766
(301) 790-6283
Counsel for Applicant
November 24, 1993
Dates Referenced Herein and Documents Incorporated by Reference
| Referenced-On Page |
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| This ‘POS AMC’ Filing | | Date | | First | | Last | | | Other Filings |
|---|
| |  |
| | 8/1/08 | | 3 |
| | 12/31/95 | | 1 | | 5 | | | 10-K405 |
| | 8/1/94 | | 4 |
| | 6/1/94 | | 3 |
| Filed on: | | 4/4/94 |
| | 1/1/94 | | 1 | | 5 |
| | 11/24/93 | | 7 |
| | 9/30/93 | | 7 |
| List all Filings |
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