U-1 1 FORM U-1 File No. 70- SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM U-1 DECLARATION UNDER THE PUBLIC UTILITY HOLDING COMPANY ACT OF 1935 -------------------------------------------- The Cincinnati Gas & The Union Light, Heat Electric Company and Power Company 139 East Fourth Street 139 East Fourth Street Cincinnati, Ohio 45202 Cincinnati, Ohio 45202 (Name of company or companies filing this statement and address of principal executive offices) -------------------------------------------------------- CINergy Corp. (Name of top registered holding company parent) ----------------------------------------------- William L. Sheafer CINergy Corp. 139 East Fourth Street Cincinnati, Ohio 45202 (Name and address of agent for service) The Commission is requested to send copies of all notices, orders and communications in connection with this Declaration to: Ms. Cheryl M. Foley James R. Lance Vice President, General Counsel Manager - Corporate Finance and Corporate Secretary CINergy Corp. CINergy Corp. 139 East Fourth Street 139 East Fourth Street Cincinnati, Ohio 45202 Cincinnati, Ohio 45202 Item 1. Description of Proposed Transactions. ------------------------------------- The Cincinnati Gas & Electric Company (CG&E) is a utility company and wholly-owned subsidiary of CINergy Corp. (CINergy), a registered holding company under the Public Utility Holding Company Act of 1935, as amended (the Act). The Union Light, Heat and Power Company (Union Light) is a utility company and wholly-owned subsidiary of CG&E and an affiliate of CINergy. CG&E and Union Light are sometimes hereinafter referred to individually as an "Operating Affiliate" and collectively as the "Operating Affiliates." CG&E hereby requests authorization to issue and sell, from time to time through March 31, 1996, an aggregate principal amount not to exceed $500 million of a combination of senior unsecured indebtedness (the Senior Debentures) and junior unsecured subordinated indebtedness (the Junior Securities). In addition, Union Light hereby requests the authorization of the Commission to issue and sell, from time to time through March 31, 1997, an aggregate principal amount not to exceed $55 million of unsecured indebtedness (the Union Debentures). The Senior Debentures and the Union Debentures are hereinafter referred to collectively as "the Senior Securities", and the Senior and Junior Securities are hereinafter referred to collectively as "the Securities". The Operating Affiliates, in conjunction with potential underwriters, have developed parameters under which the Securities are to be sold. The parameters, as hereinafter discussed, are designed to provide a reasonable allowance for potential changes in financial market conditions between the time of Commission authorization and the actual sale of the Securities. The parameters allow each Operating Affiliate to sell the Securities on any day when it believes it is prudent to do so provided the terms are within the parameters. A. The Senior Securities --------------------- The Operating Affiliates have several high coupon series of first mortgage bonds that are, or will shortly become, optionally redeemable and can be re-financed through the issuance of lower cost debt. Potential candidates for such redemptions are: Redemption Price Principal as a % of Issuer Description Outstanding Principal \1\ ------ ----------- ----------- ----------- CG&E 10-1/8% Series Due 2020 $100,000,000 107.27% CG&E 10.20% Series Due 2020 $150,000,000 107.44% CG&E 9.70% Series Due 2019 $100,000,000 107.13% ULH&P 10-1/4% Series Due 6/1/20 $15,000,000 107.34% ULH&P 10-1/4% Series Due 11/15/20 $15,000,000 107.20% ULH&P 9.70% Series Due 2019 $20,000,000 106.98% Proceeds from the sale of the Senior Securities will be used directly or indirectly to refund some or all of these high-coupon debt issues. Any balance of net proceeds from the sale of the Senior Securities will be used for general corporate purposes. None of such proceeds will be used by CG&E or Union Light to acquire, directly or indirectly, an interest in an exempt wholesale generator (EWG) or foreign utility company (FUCO) as defined in the Act. The Senior Securities will be issued at a price no higher than 101.5% nor less than 98% of the principal amount, plus accrued interest, if any, with underwriting commissions and agents' fees not to exceed 1.25% of the principal amount. The Senior Securities may be issued in one or more new series for terms not to exceed 40 years. The interest rate applicable to any series of the Senior Securities shall not exceed the following maximum spread over United States Treasury Notes and United States Treasury Bonds of comparable maturities: Maturity of Maturity of 10 Years Greater Than Or Less 10 Years --------------- ------------ (Basis Points) Senior Debentures 175 225 Union Debentures 150 200 Interest on the Senior Securities will be paid on a semi-annual basis. B. The Junior Securities --------------------- CG&E currently has preferred stock that is or will become optionally redeemable. Potential candidates for redemption are: Redemption Balance Price Per Description Outstanding Share ----------- ----------- ----------- Cumulative Preferred Stock, 7.44% Series $40,000,000 $101.00 Cumulative Preferred Stock, 9.15% Series $50,000,000 $106.10 Proceeds from the sale of the Junior Securities are anticipated to be used directly or indirectly to redeem outstanding preferred stock. Any balance of net proceeds from the sale of the Junior Securities will be used for general corporate purposes. None of such proceeds will be used by CG&E to acquire an interest in, directly or indirectly, an EWG or FUCO. CG&E believes the redemption of preferred stock with Junior Securities will provide substantial benefits over traditional preferred stock issuances. While CG&E expects that the Junior Securities will carry a somewhat higher interest rate than a preferred issue, the expected tax deductibility of interest payments on Junior Securities will afford increased cash flow and net income, and ultimately lower customer rates. In addition, CG&E's current preferred stock ratio is approximately 8%, while the latest available industry average is about 6%. By refunding preferred stock with junior debt, CG&E will bring the preferred stock component of its capital structure to a level more in line with the utility industry. The Junior Securities may be issued by CG&E in one or more new series for terms not to exceed 40 years. The Junior Securities will be issued at a price no higher than 101.5% nor less than 98% of the principal amount, plus accrued interest, if any, at an interest rate which results in a yield to maturity to the purchaser at the initial offering price not in excess of 175 basis points above the yield to maturity on United States Treasury Notes of comparable maturity for Junior Securities with a maturity of 10 years or less, and at an interest rate which results in a yield to maturity to the purchaser at the initial offering price not in excess of 225 basis points above the yield to maturity on United States Treasury Bonds of comparable maturity for Junior Securities with a maturity of more than 10 years, with underwriting commissions and agents' fees not to exceed 3.50% of the principal amount of the Junior Securities. Interest on the Junior Securities will be paid on either a monthly, quarterly, semi-annual or annual basis, and CG&E may have the right to defer payment of interest on its Junior Securities for up to five years under certain situations. B. Method of Issuance ------------------ It is difficult to determine, under present market conditions, whether it would be more advantageous to the Operating Affiliates to sell the Securities with a 40-year or some shorter maturity. It is in the public interest, however, that the Operating Affiliates be afforded the necessary flexibility to adjust their financing programs to developments in the markets for long-term debt securities when and as they occur in order to obtain the best possible price, interest rate and terms for its Securities. It is proposed, therefore, that the Operating Affiliates issue the Securities from time to time and determine at such subsequent date(s) whether there should be more than one series, the maturity of each series of the Securities (not in excess of 40 years) and the method of issuance. For each offering of the Securities, the Operating Affiliates propose to either (a) sell the Securities to one or more underwriters through a negotiated offering or (b) sell the Securities through a competitive bidding process. In the event one or more series of the Securities are sold through a negotiated offering, the terms of such Securities will be negotiated by the Operating Affiliate(s) either with a group of underwriters headed by managing underwriters or with one or more underwriters, with a limited number of purchasers or with a single purchaser for a direct sale or for a sale through agents. If one or more series of the Securities are sold through competitive bidding, such Securities will be sold to the bidder(s) whose proposal results in the lowest annual cost of money, with the Operating Affiliate(s) having the right to reject any or all bids. Each of the bidders will be required to specify the coupon rate and the price, exclusive of accrued interest, to be paid for the Securities. The redemption premiums with respect to the Securities will also be established as a result of the negotiations or as part of a competitive bidding process. After approval of the terms for each offering by each Operating Affiliate's Board of Directors, by an authorized committee thereof, or by persons authorized by the Operating Affiliate's Board of Directors, it is anticipated that an underwriting agreement setting forth the terms of the Securities of that offering would be executed. The authorization of the sale of the Securities consistent with the parameters herein in no way relieves the Operating Affiliates of their responsibility to obtain the best terms available for the structure selected and, therefore, it is appropriate and reasonable for this Commission to authorize the Operating Affiliates to agree to such terms and prices consistent with said parameters. It is expected that a new indenture would be used by each Operating Affiliate for the respective Securities issued by that Operating Affiliate, the form of such indenture being filed as Exhibit A hereto. A separate supplemental indenture would be executed by the respective Operating Affiliate covering terms of the Securities from each offering. The indenture will provide that, unless otherwise provided in a supplemental indenture or a Board Resolution, the Securities will be subordinate and subject in right of payment to the prior payment in full of all secured obligations of the respective Operating Affiliate, with the Junior Securities being junior in such rights to the Senior Debentures, whether outstanding as of the date of each indenture or thereafter incurred. The Securities will have no cross-default provisions with respect to other indebtedness of each Operating Affiliate or between Operating Affiliates. C. Statement Pursuant to Rule 54 ----------------------------- The Operating Affiliates do not intend at present to use the borrowings proposed herein to finance the acquisition of an EWG or a FUCO. If the Operating Affiliates' intention changes, an amended Declaration will be filed requesting authorization for such use. Under Rule 54, in determining whether to approve the issuance or sale of a security by a registered holding company for purposes other than the acquisition of an EWG or FUCO or other transactions by such registered holding company or its subsidiaries other than with respect to EWGs or FUCOs, the Commission shall not consider the effect of the capitalization or earnings of any subsidiary which is an EWG or FUCO upon the registered holding company system, if the conditions set forth in Rule 53(a), (b) and (c) are satisfied. As set forth below, all applicable conditions set forth in Rule 53(a) are and, assuming the consummation of the transactions proposed herein, will be satisfied, and none of the conditions set forth in Rule 53(b) exists or, as a result thereof, will exist. The following discussion assumes the CINergy system's existence for the dates and periods in question. Three CINergy system companies are EWGs or FUCOs. PSI Argentina, Inc. ("PSI Argentina") and its subsidiary, Costanera Power Corp. ("Costanera"), were determined to be EWGs by the Federal Energy Regulatory Commission ("FERC") in Costanera Power Corp., 61 FERC Par. 61,335 (1992), and PSI Argentina, Inc., 68 FERC Par. 61,286 (1994). PSI Energy Argentina ("Energy Argentina") is a FUCO and has filed with the Commission a Notification of FUCO status on Form U-57. In addition to these investments, CINergy owns a number of other companies formed to hold investments in FUCOs and/or EWGs (CGE ECK, Inc., PSI T&D International, Inc., PSI Yacyreta, Inc., and E P EDEGEL, Inc.), and is seeking authorization in File No. 70-8589 to retain certain other companies (including PSI Power Resource Development, Inc., PSI Power Resource Operations, Inc., PSI International, Inc., and PSI Sunnyside, Inc.) and to form additional companies to facilitate FUCO and EWG investments. Because none of these other companies presently owns any EWG or FUCO, they are not included in the calculations below. Rule 53(a)(1): The average of CINergy's pro forma consolidated retained earnings for the four consecutive quarters ended December 31, 1994 was $929 million, and CINergy's aggregate investment in EWGs and FUCOs at December 31, 1994 was approximately $20 million, or approximately 2% of consolidated retained earnings. Rule 53(a)(2): CINergy will maintain books and records enabling it to identify investments in and earnings from each EWG and FUCO in which it directly or indirectly holds an interest. At present, CINergy does not hold any interest in a domestic EWG; Rule 53(a)(2)(i) is therefore inapplicable. In accordance with Rule 53(a)(2)(ii), the books and records and financial statements of each foreign EWG and FUCO which is a "majority-owned subsidiary company" of CINergy are kept in conformity with and prepared according to U.S. generally accepted accounting principles ("GAAP"). CINergy will provide the Commission access to such books and records and financial statements, or copies thereof, in English, as the Commission may request. In accordance with Rule 53(a)(2)(iii), for each foreign EWG and FUCO in which CINergy directly or indirectly owns 50% or less of the voting securities, CINergy will proceed in good faith, to the extent reasonable under the circumstances, to cause each such entity's books and records to be kept in conformity with, and the financial statements of each such entity to be prepared according to, GAAP. If such books and records are maintained, or such financial statements are prepared, according to a comprehensive body of accounting principles other than GAAP, CINergy will, upon request of the Commission, describe and quantify each material variation from GAAP in the accounting principles, practices and methods used to maintain such books and records and each material variation from GAAP in the balance sheet line items and net income reported in such financial statements, as the case may be. In addition, CINergy will proceed in good faith, to the extent reasonable under the circumstances, to cause access by the Commission to such books and records and financial statements, or copies thereof, as the Commission may request, and in any event will make available to the Commission any such books and records that are available to CINergy. Rule 53(a)(3): At any one time, a maximum of approximately 25 CINergy system employees have rendered services to PSI Argentina, Costanera and Energy Argentina. Based on current staffing levels, this represents less than 0.3% of the approximately 8,650 full-time employees of CINergy's domestic operating utility subsidiaries. Such services have heretofore been rendered, in part, by employees of PSI Energy in accordance with the Commission's order in PSI Resources, Inc. et al., Rel. No. 35-25674, 52 SEC Docket 2533, 2534-35 (Nov. 13, 1992), and by employees of CG&E in accordance with business practices established prior to the formation of the CINergy system and the registration of CINergy as a holding company under the Act. Pursuant to the Commission's October 21, 1994 order in File No. 70-8427 (Rel. No. 35-26146), CINergy's service company subsidiary, CINergy Services, Inc., is authorized to provide services to utility and non-utility associate companies, including those that are EWGs or FUCOs. Rule 53(a)(4): CINergy is simultaneously submitting a copy of this Declaration, and will submit copies of any Rule 24 certificate required hereunder, as well as a copy of Item 9 of CINergy's Form U5S and Exhibits H and I thereto, to each of the public service commissions having jurisdiction over the retail rates of CINergy's operating utility subsidiaries at the time such documents are filed with the Commission. Rule 53(b): The provisions of Rule 53(a) are not made inapplicable to the authorizations herein requested by reason of the provisions of Rule 53(b). Rule 53(b)(1): Neither CINergy nor any subsidiary of CINergy is the subject of any pending bankruptcy or similar proceeding. Rule 53(b)(2): CINergy's total capital invested in utility operations as of December 31, 1994 totaled approximately $5.9 billion, consisting of approximately $2.8 billion in long-term and $208 million in short-term debt of CG&E, PSI Energy and the utility subsidiaries of CG&E, $478 million in preferred stock of CG&E and PSI Energy, and $2.4 billion in common equity of CG&E, PSI Energy and the utility subsidiaries of CG&E. CINergy's aggregate present investment in EWGs and FUCOs (approximately $20 million) represents less than 0.4% of CINergy's total capital invested in utility operations. Together with the $95 million in additional investment authority requested by CINergy in File No. 70-8589, CINergy's aggregate investment authority for EWGs and FUCOs ($115,000,000) would represent less than 2% of CINergy's total capital invested in utility operations. Average consolidated retained earnings for the four quarters ended December 31, 1994 equaled $929 million, versus $1,053 million for the four quarters ended December 31, 1993, a difference of approximately $124 million or 12%. Rule 53(b)(3): For the 12 months ended December 31, 1994, CINergy had net income of approximately $175,000 attributable to its direct or indirect investments in EWGs and FUCOs. Rule 53(c). Inasmuch as Rule 53(c) applies only if an applicant is unable to satisfy the requirements of Rules 53(a) and (b), it is inapplicable here. Item 2. Fees, Commissions and Expenses. ------------------------------- Estimates of expenses of each Operating Affiliate in connection with the proposed issuance of the Securities will be set forth in the appropriate item of that Operating Affiliate's Registration Statement under the Securities Act of 1933, with such Registration Statements to be filed as Exhibits C-1 and C-2 at a later date. No other fees, commissions or expenses, other than expenses billed at cost by Cinergy Services not to exceed $10,000, are to be paid or incurred by the Operating Affiliates or any associate company in connection with the proposed issuance of the Securities. Item 3. Applicable Statutory Provisions. -------------------------------- Sections 6(a) and 7 and Rule 54 are or may be applicable to the proposed transactions. To the extent that any other sections of the Act or rules thereunder may be applicable to the proposed transactions, the Declarants hereby request an appropriate order thereunder. Item 4. Regulatory Approval. -------------------- The proposed issuance of the Securities was authorized by The Public Utilities Commission of Ohio (PUCO) on March 29, 1995, in the case of CG&E (Case No. 95-273-GE-AIS), and is pending approval by the Kentucky Public Service Commission (KPSC) in the case of Union Light (Case No. 95- 091). A copy of the application to and order of the PUCO and a copy of the application to the KPSC has been filed as Exhibits D-1, D-3 and D-2, respectively, with a copy of the order from the KPSC to be filed by amendment hereto. If CG&E desires to issue medium-term notes, such securities will be secured by global first mortgage bond securities, and CG&E would seek separate authorization under the Act to issue such securities. No other state commission (except as aforesaid) has jurisdiction with respect to the subject transactions and no federal commission other than the Commission has jurisdiction with respect thereto. Item 5. Procedure. ---------- The Operating Affiliates hereby respectfully request that the Commission issue and publish not later than April 10, 1995, the requisite notice under Rule 23 with respect to the filing of this Declaration, and that the Commission enter not later than May 9, 1995 an appropriate order permitting this Declaration to become effective. The Operating Affiliates hereby waive a recommended decision by a hearing officer or any other responsible officer of the Commission; agree that the Staff of the Division of Investment Management may assist in the preparation of the Commission's decision; and request that there be no waiting period between the issuance of the Commission's order and the date on which it is to become effective. Item 6. Exhibits and Financial Statements. ---------------------------------- (a) Exhibits: A-1 Form of Indenture for Unsecured Securities (to be filed by amendment). A-2 Form of Supplemental Indenture for Unsecured Securities (to be filed by amendment). B Form of Underwriting Agreement (to be filed by amendment). C-1 Registration Statement of CG&E under the Securities Act of 1933 relating to the Senior Debentures and the Junior Securities which are the subject hereof and all amendments and exhibits thereto (incorporated by reference to the file number assigned to the Registration Statement of CG&E to be filed under the Securities Act of 1933). C-2 Registration Statement of Union Light under the Securities Act of 1933 relating to the Union Debentures which are the subject hereof and all amendments and exhibits thereto (incorporated by reference to the file number assigned to the Registration Statement of Union Light to be filed under the Securities Act of 1933). D-1 Copy of Application to The Public Utilities Commission of Ohio (Case No. 95-273-GE-AIS). D-2 Copy of Application to the Kentucky Public Service Commission (Case No. 95-091). D-3 Copy of Order of The Public Utilities Commission of Ohio (Case No. 95-273-GE-AIS). D-4 Copy of Order of the Kentucky Public Service Commission (Case No. 95-091)(to be filed by amendment). E Not Applicable. F Opinion of counsel (to be filed by amendment). G Form of Notice of Proposed Transactions for publication in Federal Register. (b) Financial Statements: FS-1 CG&E Unaudited Pro Forma Consolidated Balance Sheet at December 31, 1994. FS-2 CG&E Unaudited Pro Forma Consolidated Statement of Income for the Twelve Months Ended December 31, 1994. FS-3 CG&E Unaudited Pro Forma Consolidated Statement of Changes in Retained Earnings for the Twelve Months Ended December 31, 1994. FS-4 CG&E Pro Forma Consolidated Journal Entries to give effect to the issuance of up to $555 million of debt securities and related redemption of outstanding debt and preferred securities. FS-5 CG&E Statement of Bondable Property Additions as of December 31, 1994. FS-6 Union Light Unaudited Pro Forma Balance Sheet at December 31, 1994. FS-7 Union Light Unaudited Pro Forma Statement of Income for the Twelve Months Ended December 31, 1994. FS-8 Union Light Unaudited Pro Forma Statement of Changes in Retained Earnings for the Twelve Months Ended December 31, 1994. FS-9 Union Light Pro Forma Journal Entries to give effect to the issuance of up to $55 million of debt securities and related redemption of outstanding debt securities. FS-10 Union Light Statement of Bondable Property Additions as of December 31, 1994. FS-11 CINergy Unaudited Pro Forma Consolidated Balance Sheet at December 31, 1994. FS-12 CINergy Unaudited Pro Forma Consolidated Statement of Income for the Twelve Months Ended December 31, 1994. FS-13 CINergy Unaudited Pro Forma Consolidated Statement of Changes in Retained Earnings for the Twelve Months Ended December 31, 1994. FS-14 CINergy Pro Forma Consolidated Journal Entries to give effect to the issuance of up to $555 million of debt securities and related redemption of outstanding debt and preferred securities. FS-15 Financial Data Schedule for CG&E (included in electronic transmission only). FS-16 Financial Data Schedule for Union Light (included in electronic transmission only). FS-17 Financial Data Schedule for CINergy (included in electronic transmission only). Item 7. Information as to Environmental Effects. ---------------------------------------- The proposed transactions relate only to financing activities of the Operating Affiliates and do not involve a major federal action having a significant impact on the human environment. The Operating Affiliates are not aware of any federal agency that has prepared or is preparing an environmental impact statement with respect to the proposed transactions. S I G N A T U R E Pursuant to the requirements of the Public Utility Holding Company Act of 1935, as amended, the undersigned company has duly caused this document to be signed on its behalf by the undersigned thereunto duly authorized. THE CINCINNATI GAS & ELECTRIC COMPANY By: \S\William L. Sheafer William L. Sheafer Treasurer THE UNION LIGHT, HEAT AND POWER COMPANY By: \S\William L. Sheafer William L. Sheafer Treasurer Dated: March 30, 1995 FOOTNOTES \1\ By letter to be dated March 31, 1995, CG&E and Union Light intend to notify certain bondholders that the Companies expect to redeem certain bonds at par through the operation of the Maintenance and Replacement Fund provisions of the Companies' respective Indentures. EX-99.D.1 2 APPLICATION FILED WITH THE PUBLIC UTILITIES COMMISSION OF OHIO BEFORE THE PUBLIC UTILITIES COMMISSION OF OHIO In the Matter of the Application of ) The Cincinnati Gas & Electric Company ) for Authority to Issue and Sell up to ) Case No. 95-273-GE-AIS $500 Million of First Mortgage Bonds, ) Secured Medium Term Notes, Senior ) Unsecured Debt, or Junior Unsecured ) Subordinated Debt ) APPLICATION ------------ To the Honorable The Public Utilities Commission of Ohio: The Cincinnati Gas & Electric Company (CG&E), a public utility as defined by the Ohio Revised Code, respectfully represents the following: 1. CG&E proposes, with the necessary consent and authority of this Commission, to issue and sell, from time to time over a period ending March 31, 1996, up to $500 million principal amount of first mortgage bonds (the New Bonds), secured medium term notes (the Notes), senior unsecured indebtedness (the Senior Debentures) or junior unsecured subordinated indebtedness (the Subordinated Debt), or any combination thereof. The New Bonds, the Notes, the Senior Debentures and the Subordinated Debt are referred to collectively as "the Securities". 2. The New Bonds, the Senior Debentures and the Subordinated Debt will be issued in one or more series for terms not to exceed 40 years. The Notes will be issued in one or more series for terms not less than one year and not more than 40 years. 3. Proceeds from the sale of the Securities will be used to refund outstanding debt and preferred stock or for other general corporate purposes, pursuant to Section 4905.40, Ohio Revised Code. It is anticipated that the Subordinated Debt would be issued only to redeem outstanding preferred stock. 4. CG&E proposes to either (a) sell the Securities to one or more underwriters through a negotiated offering or (b) sell the Securities through a competitive bidding process. In the event the Securities are sold through a negotiated offering, the terms of each offering of the Securities will be negotiated by CG&E either with a group of underwriters headed by managing underwriters or with one or more underwriters, with a limited number of purchasers or with a single purchaser for a direct sale or for a sale through agents. If the Securities are sold through competitive bidding, the Securities will be sold to the bidder(s) whose proposal results in the lowest annual cost of money, with CG&E having the right to reject any or all bids. Each of the bidders will be required to specify the coupon rate and the price, exclusive of accrued interest, to be paid for the Securities. After approval of the terms for each offering by CG&E's Board of Directors, by an authorized committee thereof or by persons authorized by CG&E's Board of Directors, it is anticipated that an agreement setting forth the terms of the Securities would be signed. 5. CG&E has filed a Registration Statement with the Securities and Exchange Commission (SEC) on Form S-3 (Registration No. 33-52335) for the registration of the New Bonds or Notes as first mortgage bonds under the Securities Act of 1933 (the Act), to permit sales thereof from time to time pursuant to the provisions of Rule 415 (providing for "Shelf Registration" under the Act). The prospectus filed as part of such Registration Statement relates to $380 million principal amount of the New Bonds or Notes, pursuant to Rule 429 under the Act. CG&E may either amend such Registration Statement through one or more post-effective amendments for substantive changes from or additions to the previously filed prospectus or may file a new registration statement on Form S-3. No filing under the Public Utility Holding Company Act of 1935 (PUHCA) is required with respect to the New Bonds since such securities are exempt under Rule 52 of the PUHCA. In addition to Commission approval, SEC approval under the PUHCA would be required to issue the Notes, the Senior Debentures and the Subordinated Debt. 6. CG&E proposes that the Commission issue its order authorizing the issuance and sale of the Securities prior to the time CG&E reaches agreement with respect to the terms of the Securities. 7. CG&E, in conjunction with potential underwriters, has developed parameters under which the Securities are to be sold. The parameters, as set forth in Exhibit A, are designed to provide a reasonable allowance for potential changes in financial market conditions between the time of Commission authorization and the actual sale of the Securities. The inclusion of the parameters within the Order would allow CG&E to sell the Securities on any day when it believes it is prudent to do so provided the terms are within the parameters. 8. The authorization of the sale of the Securities consistent with the parameters herein in no way relieves CG&E of its responsibility to obtain the best terms available for the structure selected and, therefore, it is appropriate and reasonable for this Commission to authorize CG&E to agree to such terms and prices consistent with said parameters. 9. If the New Bonds or the Notes are issued, they will be issued under and secured by the First Mortgage dated as of August 1, 1936 between CG&E and The Bank of New York, Trustee, as previously amended and supplemented and to be supplemented by one or more supplemental indentures. The Senior Debentures and the Subordinated Debt will be issued under a loan agreement or similar document, or an indenture or indentures between CG&E and one or more trustees to be named at a later date. 10. The redemption premiums with respect to the Securities will also be established as a result of the negotiations or as part of a competitive bidding process. 11. As a result of the sale of the maximum amount of the Securities and the possible redemption of outstanding obligations, CG&E's annual long-term interest charges are expected to change. The effect of any change in cost on revenue requirements can be determined only in rate proceedings in which all factors relating to CG&E's revenue requirements are taken into account according to law. 12. CG&E proposes either to credit premiums or charge discounts, if any, and to charge the expenses to be incurred in connection with each issue to the proper deferred accounts and amortize such amounts over the respective lives of the Securities in equal annual amounts to current income. 13. A balance sheet of CG&E showing its assets and liabilities as of December 31, 1994, and an income statement of CG&E for the 12 months ended December 31, 1994, are attached and marked Exhibit B. WHEREFORE, The Cincinnati Gas & Electric Company requests that this Commission issue an order finding that: (1) Applicant is a public utility as defined in Section 4905.02, Ohio Revised Code, and as such is subject to the jurisdiction of this Commission. (2) The Application is filed under provisions of Section 4905.41, Ohio Revised Code. (3) Applicant proposes to issue and sell, from time to time over a period ending March 31, 1996, up to $500 million principal amount of first mortgage bonds (the New Bonds), secured medium term notes (the Notes), senior unsecured indebtedness (the Senior Debentures) or junior unsecured subordinated indebtedness (the Subordinated Debt), or any combination thereof. The New Bonds, the Notes, the Senior Debentures and the Subordinated Debt are referred to collectively as "the Securities". (4) The New Bonds, the Senior Debentures and the Subordinated Debt will be issued in one or more series for terms not to exceed 40 years. The Notes will be issued in one or more series for terms not less than one year and not more than 40 years. (5) If the New Bonds or the Notes are issued, they will be issued under and secured by the First Mortgage dated as of August 1, 1936 between Applicant and The Bank of New York, Trustee, as previously amended and supplemented and to be supplemented by one or more supplemental indentures. The Senior Debentures and the Subordinated Debt will be issued under a loan agreement or similar document, or an indenture or indentures between CG&E and one or more trustees to be named at a later date. (6) Applicant, in conjunction with potential underwriters, has developed parameters under which the Securities are to be sold. The parameters, as set forth in Exhibit A to the Application, are designed to provide a reasonable allowance for potential changes in financial market conditions between the time of Commission authorization and the actual sale of the Securities. The inclusion of the parameters within this Order would allow the Applicant to sell the Securities on any day when it believes it is prudent to do so provided the terms are within the parameters. (7) The authorization of the sale of the Securities consistent with the parameters herein in no way relieves the Applicant of its responsibility to obtain the best terms available for the structure selected and, therefore, it is appropriate and reasonable for this Commission to authorize Applicant in this Order to agree to such terms and prices consistent with said parameters. (8) The proceeds from the sale or sales of the Securities will be used to refund outstanding debt and preferred stock or for other general corporate purposes, pursuant to Section 4905.40, Ohio Revised Code. (9) Based on information contained in the Application and exhibits thereto, the purpose to which the proceeds from the issue and sale of the Securities shall be applied is reasonably required by the Applicant to meet its present and prospective obligations to provide utility service. (10) The maximum amount of the Securities is just and reasonable, and the probable cost, price to Applicant, and other terms thereof, within the limits described above, to be determined pursuant to arm's length negotiation or through competitive bidding with right of refusal of any or all bids, are just and reasonable. (11) The issuance of the Securities and the possible redemption of outstanding obligations are expected to change Applicant's annual long-term interest charges. The effect on revenue requirements resulting from issuance of the Securities and the possible redemption of outstanding obligations will be reflected in the determination of required revenue in rate proceedings in which all factors affecting rates are taken into account according to law. (12) Applicant proposes either to credit premiums or charge discounts, if any, and to charge expenses incurred in connection with each issue to the proper deferred accounts to be amortized in equal annual amounts to Current Income over the respective lives of the Securities. (13) The issuance and sale by Applicant of the Securities is reasonably required and the money to be procured therefrom is necessary for Applicant's lawful corporate purposes, and the Commission is satisfied that consent and authority should be granted accordingly. and ordering that: 1. The Cincinnati Gas & Electric Company is hereby authorized to issue and sell, from time to time over a period ending March 31, 1996, up to $500 million principal amount of the New Bonds, the Notes, the Senior Debentures or the Subordinated Debt, or any combination thereof, in one or more series, and on terms consistent with the parameters set forth in Exhibit A to the Application. 2. The New Bonds and the Notes, if issued, are to be issued under and secured by the First Mortgage dated as of August 1, 1936 between CG&E and The Bank of New York, Trustee, as previously amended and supplemented and to be supplemented by one or more supplemental indentures. The Senior Debentures and the Subordinated Debt will be issued under a loan agreement or similar document, or an indenture or indentures between CG&E and one or more trustees to be named at a later date. 3. When the Securities authorized by this Order are issued and sold, The Cincinnati Gas & Electric Company shall report to this Commission the terms and full particulars regarding each sale of Securities or, in lieu of that, Applicant may submit a copy of each prospectus as filed with the Securities and Exchange Commission setting forth each sale of the Securities. 4. The cash proceeds procured from the aforesaid issuance and sale of the Securities are to be used for the purposes specified in Finding (8) above as provided in Section 4905.40, Ohio Revised Code. 5. Applicant is hereby authorized either to credit premiums or charge discounts, if any, and to charge the expenses incurred in connection with each issue to the proper deferred accounts and amortize such amounts over the respective lives of the Securities in equal annual amounts to current income. 6. Nothing in this Order shall be construed to imply any guaranty or obligation as to the Securities, or the interest thereon, on the part of the State of Ohio. Respectfully submitted this 9th day of March 1995. Jerome A. Vennemann, Esq. THE CINCINNATI GAS & ELECTRIC COMPANY James B. Gainer, Esq. P. O. Box 960 Cincinnati, Ohio 45201 and By /s/ J. Wayne Leonard TAFT, STETTINIUS & HOLLISTER J. Wayne Leonard Ronal R. Newbanks, Esq. Group Vice President and Star Bank Center Chief Financial Officer Cincinnati, Ohio 45202 By /s/ William L. Sheafer William L. Sheafer Treasurer STATE OF OHIO ) COUNTY OF HAMILTON ) ss: Personally appeared before me J. Wayne Leonard and William L. Sheafer, who being first duly sworn, say that they are the Group Vice President and Chief Financial Officer and the Treasurer, respectively, of The Cincinnati Gas & Electric Company, that they did sign the foregoing Application, and that the statements contained therein are true as they verily believe. Sworn to and subscribed before me this 9th day of March 1995. (Seal) /s/ Steven A. Niederbaumer Steven A. Niederbaumer Notary Public, State of Ohio My Commission Expires October 26, 1999 Exhibit A Page 1 The Cincinnati Gas & Electric Company Summary Principal Amount: Up to $500 million of bonds (the New Bonds), secured medium term notes (the Notes), senior unsecured indebtedness (the Senior Debentures) or junior unsecured subordinated indebtedness (the Subordinated Debt), or any combination thereof, in one or more series. Maturity: Up to 40 years for the New Bonds, the Senior Debentures and the Subordinated Debt, and not less than one year or more than 40 years for the Notes. Purpose: To refund outstanding obligations or for other general corporate purposes. Lead Underwriters: To be named. Underwriting Commissions or Agents' Fees: Not to exceed 1.25% of the principal amount for the New Bonds, the Notes and the Senior Debentures, and not to exceed 3.50% of the principal amount for the Subordinated Debt. Price to Public: No higher than 101 1/2% nor less than 98% of the principal amount, plus accrued interest, if any. Interest Rate: For the New Bonds and the Notes with a maturity of 10 years or less, not to exceed 125 basis points above the yield to maturity on United States Treasury Notes of comparable maturity at the time of pricing. For the New Bonds and the Notes with a maturity of more than 10 years, not in excess of 175 basis points above the yield to maturity on United States Treasury Bonds of comparable maturity at the time of pricing. Exhibit A Page 2 The Cincinnati Gas & Electric Company Summary Interest Rate (Cont'd): For the Senior Debentures and the Subordinated Debt with a maturity of 10 years or less, not to exceed 175 basis points above the yield to maturity on United States Treasury Notes of comparable maturity at the time of pricing. For the Senior Debentures and the Subordinated Debt with a maturity of more than 10 years, not in excess of 225 basis points above the yield to maturity on United States Treasury Bonds of comparable maturity at the time of pricing.
EXHIBIT B Page 1 of 3 THE CINCINNATI GAS & ELECTRIC COMPANY Balance Sheet at December 31, 1994 ASSETS UTILITY PLANT In service $ 4,998,869,247 Less -- Accumulated provisions for depreciation 1,509,607,374 ---------------- 3,489,261,873 Construction work in progress 66,081,457 ---------------- Net Utility Plant 3,555,343,330 ---------------- OTHER PROPERTY AND INVESTMENTS Non-utility property -- net 2,217,893 Investments in subsidiaries 129,559,816 Other 1,897,614 ---------------- 133,675,323 ---------------- CURRENT ASSETS Cash 160,138 Short-term investments 51,881,190 Accounts receivable, less accumulated provision of $8,552,224 for doubtful accounts 157,921,593 Accounts receivable from subsidiary companies -- net 21,073,406 Accrued unbilled revenues 72,035,009 Materials, supplies and fuel, at average cost 123,678,736 Prepayments and other current assets 141,028,446 ---------------- 567,778,518 ---------------- OTHER ASSETS Post-in-service carrying costs and deferred operating expenses 148,117,487 Phase-in deferred return and depreciation 100,942,251 Amounts due from customers -- income taxes 381,367,104 Other 107,740,851 ---------------- 738,167,693 ---------------- $ 4,994,964,864 ================
EXHIBIT B Page 2 of 3 THE CINCINNATI GAS & ELECTRIC COMPANY Balance Sheet at December 31, 1994 LIABILITIES CAPITALIZATION Common shareholders' equity -- Common shares, par value $8.50 per share -- Authorized -- 120,000,000 shares Outstanding -- 89,663,086 shares $ 762,136,231 Additional paid-in capital 337,874,442 Earnings retained in the business 432,961,669 ---------------- Total common shareholders' equity 1,532,972,342 ---------------- Cumulative preferred shares, par value $100 per share -- Authorized -- 6,000,000 shares Outstanding -- 4 % Series - 270,000 shares 27,000,000 4-3/4 % Series - 130,000 shares 13,000,000 7.44 % Series - 400,000 shares 40,000,000 9.15 % Series - 500,000 shares 50,000,000 7-7/8 % Series - 800,000 shares 80,000,000 7-3/8 % Series - 800,000 shares 80,000,000 ---------------- Total preferred shares 290,000,000 ---------------- Total shareholders' equity 1,822,972,342 ---------------- Long-term debt -- First mortgage bonds 5-7/8 % Series due 1997 30,000,000 6-1/4 % Series due 1997 100,000,000 5.80 % Series due 1999 110,000,000 7-3/8 % Series due 1999 50,000,000 7-3/8 % Series due 2001 60,000,000 7-1/4 % Series due 2002 100,000,000 8-1/8 % Series due 2003 60,000,000 6.45 % Series due 2004 110,000,000 10-1/8 % Series due 2015 84,000,000 9.70 % Series due 2019 100,000,000 10-1/8 % Series due 2020 100,000,000 10.20 % Series due 2020 150,000,000 8.95 % Series due 2021 100,000,000 8-1/2 % Series due 2022 100,000,000 7.20 % Series due 2023 300,000,000 5.45 % Series A due 2024 21,400,000 5.45 % Series B due 2024 25,300,000 5.50 % Series C due 2024 48,000,000 ---------------- 1,648,700,000 ---------------- Other long-term debt 6.50 % due 2022 12,720,663 Variable rate due 2013 16,000,000 Variable rate due 2015 84,000,000 ---------------- 112,720,663 ---------------- Unamortized premium and discount (net) (14,102,213) ---------------- Total long-term debt 1,747,318,450 ---------------- 3,570,290,792 ---------------- CURRENT LIABILITIES Accounts payable 107,742,215 Preferred dividends declared 5,362,125 Accrued taxes 224,254,841 Accrued interest on debt 29,746,062 Other current and accrued liabilities 28,396,711 ---------------- 395,501,954 ---------------- DEFERRED CREDITS AND OTHER Deferred income taxes 721,102,244 Investment tax credits 129,790,275 Other 178,279,599 ---------------- 1,029,172,118 ---------------- $ 4,994,964,864 ================
EXHIBIT B Page 3 of 3 THE CINCINNATI GAS & ELECTRIC COMPANY Income Statement Twelve Months Ended December 31, 1994 OPERATING REVENUES Electric $ 1,304,413,962 Gas 364,826,553 ---------------- Total operating revenues 1,669,240,515 ---------------- OPERATING EXPENSES Gas purchased 204,078,509 Fuel used in electric production 326,108,648 Other operation 310,127,974 Maintenance 101,200,486 Provision for depreciation 161,689,401 Post-in-service deferred operating expenses -- net 3,290,292 Phase-in deferred depreciation (2,161,045) Taxes other than income taxes 193,085,422 Income taxes 89,308,292 Deferred income taxes due to -- Liberalized depreciation -- net 39,086,048 Other (24,238,288) Provision for investment tax credits, net of amortization (5,804,067) ---------------- Total operating expenses 1,395,771,672 ---------------- OPERATING INCOME 273,468,843 ---------------- OTHER INCOME AND DEDUCTIONS Allowance for other funds used during construction 1,893,451 Phase-in deferred return 15,350,724 Income taxes (5,474,774) Other -- net 16,364,167 ---------------- Total other income and deductions 28,133,568 ---------------- INCOME BEFORE INTEREST CHARGES 301,602,411 ---------------- Interest charges 144,535,403 Allowance for borrowed funds used during construction -- credit (1,687,144) ---------------- Net interest charges 142,848,259 ---------------- NET INCOME 158,754,152 Preferred dividends 22,376,504 ---------------- EARNINGS ON COMMON SHARES $ 136,377,648 ================
EX-99.D.2 3 APPLICATION FILED WITH THE KENTUCKY PUBLIC SERVICE COMMISSION COMMONWEALTH OF KENTUCKY BEFORE THE PUBLIC SERVICE COMMISSION In the Matter of the Application ) of The Union Light, Heat and Power ) Company for Order Authorizing ) No. 95-091 Issue and Sale of up to $55,000,000 ) Principal Amount of First Mortgage ) Bonds or Unsecured Debt ) APPLICATION ------------ The petition of The Union Light, Heat and Power Company (Applicant) respectfully shows: (A) That the applicant is engaged in the business of furnishing gas and/or electric service to customers in various municipalities and unincorporated areas of Kenton, Campbell, Boone, Gallatin, Grant, and Pendleton Counties, Kentucky. (B) That Applicant's post office address is 107 Brent Spence Square, Covington, Kentucky 41011 and the address of Applicant's principal executive office is 139 East Fourth Street, Cincinnati, Ohio 45202. (C) That pursuant to KRS 278.300 and 807 KAR 5:001 Section 11, for authority to issue securities, notes, bonds, stocks, or other evidences of indebtedness: 1. Description of Property, etc. (807 KAR 5:001 SECTION 11(1)(a)): -------------------------------------------- Applicant renders electric or gas service, or both, in a territory of about 500 square miles and having an estimated population of about 280,000. Its principal properties are electric and gas distribution facilities. As of December 31, 1994, the original cost of its property was $340,960,350. 2. Issue Proposed (807 KAR 5:001 SECTION 11(1)(b)): ----------------------------------------------- Applicant proposes, with the necessary consent and authority of this Commission, to issue and sell, from time to time over a period ending March 31, 1997, up to $55 million principal amount of first mortgage bonds (the New Bonds) or unsecured indebtedness (the New Notes), or any combination thereof. The New Bonds and the New Notes are referred to collectively as "the Securities". The Securities will be issued in one or more series for terms not to exceed 40 years. Applicant proposes to either (a) sell the Securities to one or more underwriters through a negotiated offering or (b) sell the Securities through a competitive bidding process. In the event the Securities are sold through a negotiated offering, the terms of each offering of the Securities will be negotiated by Applicant either with a group of underwriters headed by managing underwriters or with one or more underwriters, with a limited number of purchasers or with a single purchaser for a direct sale or for a sale through agents. If the Securities are sold through competitive bidding, the Securities will be sold to the bidder(s) whose proposal results in the lowest annual cost of money, with Applicant having the right to reject any or all bids. Each of the bidders will be required to specify the coupon rate and the price, exclusive of accrued interest, to be paid for the Securities. After approval of the terms for each offering by Applicant's Board of Directors or by persons authorized by the Applicant's Board of Directors, it is anticipated that an agreement setting forth the terms of the Securities would be signed. Applicant has filed a Registration Statement with the Securities and Exchange Commission (SEC) on Form S-3 (Registration No. 33-40245) for the registration of the New Bonds as first mortgage bonds under the Securities Act of 1933 (the Act), to permit sales thereof from time to time pursuant to the provisions of Rule 415 (providing for "Shelf Registration" under the Act). The prospectus filed as part of such Registration Statement relates to $20 million principal amount of the New Bonds. Applicant may either amend such Registration Statement through one or more post-effective amendments for substantive changes from or additions to the previously filed prospectus or may file a new registration statement on Form S-3. No filing under the Public Utility Holding Company Act of 1935 (PUHCA) is required with respect to the New Bonds since such securities are exempt under Rule 52 of the PUHCA. In addition to Commission approval, SEC approval under the PUHCA would be required to issue the New Notes. Applicant proposes that the Commission issue its order authorizing the issuance and sale of the Securities prior to the time Applicant reaches agreement with respect to the terms of the Securities. Applicant, in conjunction with potential underwriters, has developed parameters under which the Securities are to be sold. The parameters, as set forth in Exhibit A, are designed to provide a reasonable allowance for potential changes in financial market conditions between the time of Commission authorization and the actual sale of the Securities. The inclusion of the parameters within the Order would allow Applicant to sell the Securities on any day when it believes it is prudent to do so provided the terms are within the parameters. The authorization of the sale of the Securities consistent with the parameters herein in no way relieves Applicant of its responsibility to negotiate and obtain the best terms available for the structure selected and, therefore, it is appropriate and reasonable for this Commission to authorize Applicant to agree to such terms and prices consistent with said parameters. The New Bonds will be issued under and secured by the First Mortgage dated as of February 1, 1949 between Applicant and The Bank of New York, Trustee, as previously amended and supplemented and to be supplemented by one or more supplemental indentures. The New Notes will be issued under a loan agreement or similar document, or an indenture or indentures between Applicant and one or more trustees to be named at a later date. Applicant proposes either to credit premiums or charge discounts, if any, and to charge the expenses to be incurred in connection with each issue to the proper deferred accounts and amortize such amounts over the respective lives of the Securities in equal annual amounts to current income. 3. Use of Proceeds (807 KAR 5:001 SECTION 11(1)(C): ------------------------------------------------ The proceeds from the issuance of the Securities will be used to redeem Applicant's $15 million principal amount of First Mortgage Bonds, 10-1/4% Series Due June 1, 2020, to redeem Applicant's $15 million principal amount of First Mortgage Bonds, 10-1/4% Series Due November 15, 2020, to redeem Applicant's $20 million principal amount of First Mortgage Bonds, 9.70% Series Due 2019, to redeem Applicant's short-term indebtedness, for such additional expenditures as contemplated by KRS 278.300, or for other lawful corporate purposes. The issue is therefore for a lawful object within Applicant's corporate purposes, necessary and appropriate for and consistent with the proper performance by it of its services to the public, will not impair its ability to perform those services, and is reasonably necessary and appropriate for such purposes. 4. Detail of Estimated Construction Expenditures, etc. (807 KAR 5:001 SECTION 11(1)(d)): --------------------------------------------------- Not applicable since no specific construction projects are contemplated at this time to be funded with the proceeds from the issuance of the Securities. 5. Discharge of Obligations (807 KAR 5:001 SECTION 11(1)(e)): --------------------------------------- The $15 million principal amount of First Mortgage Bonds, 10-1/4% Series Due June 1, 2020 contemplated to be discharged with the proceeds from the sale of the Securities was issued under and secured by the First Mortgage dated as of February 1, 1949, as amended through the Eleventh Supplemental Indenture dated as of June 1, 1990, between Applicant and The Bank of New York, Trustee. The Bonds of Series Due June 1, 2020 were sold to underwriters on June 6, 1990 for $14,799,000 (before associated expenses of $86,186). The proceeds of the Bonds of Series Due June 1, 2020 were used to repay a portion of the Applicant's short-term indebtedness incurred primarily in connection with its construction program. The $15 million principal amount of First Mortgage Bonds, 10-1/4% Series Due November 15, 2020 contemplated to be discharged with the proceeds from the sale of the Securities was issued under and secured by the First Mortgage dated as of February 1, 1949, as amended through the Twelfth Supplemental Indenture dated as of November 15, 1990, between Applicant and The Bank of New York, Trustee. The Bonds of Series Due November 15, 2020 were sold to underwriters on November 26, 1990 for $14,769,750 (before associated expenses of $96,599). The proceeds of the Bonds of Series Due November 15, 2020 were used to repay a portion of the Applicant's short-term indebtedness incurred primarily in connection with its construction program and to redeem, at par, Applicant's $5 million principal amount of First Mortgage Bonds, 15-3/8% Series Due December 15, 1991. The $20 million principal amount of First Mortgage Bonds, 9.70% Series Due 2019 contemplated to be discharged with the proceeds from the sale of the Securities was issued under and secured by the First Mortgage dated as of February 1, 1949, as amended through the Tenth Supplemental Indenture dated as of July 1, 1989, between Applicant and The Bank of New York, Trustee. The Bonds of Series Due 2019 were sold to underwriters on July 5, 1989 for $19,745,000 (before associated expenses of $105,478). The proceeds of the Bonds of Series Due 2019 were used to repay the Applicant's short-term indebtedness incurred primarily in connection with its construction program and to retire Applicant's $6.1 million principal amount of First Mortgage Bonds, 5% Series Due July 1, 1989. The short-term indebtedness which may be discharged with the proceeds from the sale of the Securities will be in the form of unsecured bank loans or other short-term obligations, including intercompany borrowings. Authority to issue up to $35 million of short-term unsecured promissory notes was approved by the Federal Energy Regulatory Commission on October 25, 1994, in Docket Nos. ES94-43-000 and ES94-43-001. The interest rates on the loans to be repaid will be at the prevailing prime commercial bank rate or lower at the date of each borrowing or renewal. 6. Financial Exhibit (807 KAR 5:001 SECTION 11(2)(a) and SECTION 6): ------------------------------------------------- Applicant is filing herewith the following exhibits, which are incorporated herein and made a part of this application: Exhibit ---------------- 807 KAR 5:001 Letter Page Description Section Reference ------ ---- ----------- ----------------- B Financial Exhibit 11(2)(a) and 6 B 1 Amount and kinds of stock authorized 6(1) B 1 Amount and kinds of stock issued and outstanding 6(2) B 1 Terms of preference of preferred stock 6(3) B 1 Brief description of each mortgage on property of applicant 6(4) B 2 Amount of bonds authorized and issued and related information 6(5) B 2 Notes outstanding and related information 6(6) B 2 Other indebtedness and related information 6(7) B 2 Dividend information 6(8) B 3-6 Detailed Income Statement and Balance Sheet 6(9) 7. First Mortgage and Supplemental Indentures (807 KAR 5:001 SECTION 11(2)(b)): Documents indicated were filed in the following proceedings, respectively: Case Exhibit Document Style of Case No. No. -------- --------------- ---- --- First Mortgage In the Matter of the 1797 5 dated as of Application of the Union February 1, 1949 Light, Heat and Power Company for an Order Authorizing Issue of Capital Stock and First Mortgage Bonds First Supplemental In the Matter of the 2569 4 Indenture dated as Application of The Union of October 1, 1951 Light, Heat and Power Company for an Order Authorizing a ten-for-one Capital Stock Split, Changing Par Value from $100 to $15 per share thereof and Transfer from Earned Surplus Account to Capital Stock Account the Sum of $1,247,904.26 Second Supplemental In the Matter of the 2896 3 Indenture dated as Application of The Union of May 1, 1954 Light, Heat and Power Company for an Order Authorizing Issue of Additional Capital Stock Third Supplemental In the Matter of the 3976 3 Indenture dated as Application of The Union of July 1, 1959 Light, Heat and Power Company for an Order Authorizing Issue of Additional Capital Stock Fourth Supplemental In the Matter of the 5085 3 Indenture dated as Application of The Union of July 1, 1963 Light, Heat and Power Company for authority to issue up to $6,000,000 of short-term bank loans with no maturity to exceed 25 months Fifth Supplemental In the Matter of the 5085 4 Indenture dated as Application of The Union of January 1, 1967 Light, Heat and Power Company for authority to issue up to $6,000,000 of short-term bank loans with no maturity to exceed 25 months Sixth Supplemental In the Matter of the 5567 3 Indenture dated as Application of The Union of June 1, 1970 Light, Heat and Power Company for authority to issue up to $5,000,000 of short-term bank loans with no maturity to exceed 25 months Seventh Supplemental In the Matter of the 7270 E Indenture dated as Application of The Union of October 1, 1973 Light, Heat and Power Company for Order Authorizing Issue of $10,000,000 First Mortgage Bonds, Series Due 2003 Eighth Supplemental In the Matter of the 8387 C Indenture dated as Application of The Union of December 1, 1978 Light, Heat and Power Company for Order Authorizing Issue of $10,000,000 First Mortgage Bonds, Series Due 2008 Ninth Supplemental In the Matter of the 89-120 C Indenture dated Application of The Union as of Light, Heat and Power Company December 15, 1981 for Order Authorizing Issue and Sale of up to $35,000,000 Principal Amount of First Mortgage Bonds Tenth Supplemental In the Matter of the 90-295 C Indenture dated as Application of The Union of July 1, 1989 Light, Heat and Power Company for Order Authorizing Issue and Sale of up to $55,000,000 principal Amount First Mortgage Bonds Eleventh In the Matter of the 90-295 D Supplemental Application of The Union Indenture dated as Light, Heat and Power Company of June 1, 1990 for Order Authorizing Issue and Sale of up to $55,000,000 principal Amount of First Mortgage Bonds Twelfth Supplemental In the Matter of the 92-418 B Indenture dated as Application of The Union of November 15, 1990 Light, Heat and Power Company for Order Authorizing Issue of Capital Stock Thirteenth In the Matter of the 92-418 C Supplemental Application of The Union Indenture dated as Light, Heat and Power Company of August 1, 1992 for Order Authorizing Issue of Capital Stock 8. Maps and Plans (807 KAR 5:001 SECTION 11(2)(c)): ----------------------------------------------- Not applicable. 9. Articles of Incorporation (807 KAR 5:001 SECTION 8(3)): ------------------------------------------------------ A certified copy of Applicant's Restated Articles of Incorporation previously was filed with the Commission in the Matter of an Adjustment of Gas and Electric Rates of The Union Light, Heat and Power Company in Case No. 6566. WHEREFORE, Applicant asks that the Public Service Commission of the Commonwealth of Kentucky make its order authorizing Applicant to issue up to $55 million principal amount of its First Mortgage Bonds or unsecured debt, for the purposes herein stated and in a manner as herein set forth, and authorizing Applicant to charge expenses to be incurred in connection with the issue of the Securities to the proper deferred account and to amortize such amount over the life of the Securities in equal amounts to Current Income. Dated at Cincinnati, Ohio, this 9th day of March, 1995. THE UNION LIGHT, HEAT AND POWER COMPANY By /s/ William L. Sheafer William L. Sheafer Treasurer Its Attorneys: /s/ Jerome A. Vennemann Jerome A. Vennemann, Esq. James B. Gainer, Esq. The Union Light, Heat and Power Company 107 Brent Spence Square Covington, Kentucky 41011 and Taft, Stettinius & Hollister Ronal R. Newbanks, Esq. Star Bank Center Cincinnati, Ohio 45202 VERIFICATION STATE OF OHIO ) ) SS: COUNTY OF HAMILTON ) William L. Sheafer, being first duly sworn, deposes and says: that he is Treasurer of the Applicant in the proceeding entitled as above; that he has read the foregoing application and knows the contents thereof; and that the same is true of his own knowledge, except as to matters which are therein stated on information or belief, and that as to those matters he believes them to be true. /s/ William L. Sheafer William L. Sheafer Subscribed and sworn to before me, this 9th day of March, 1995. (Seal) /s/ Steven A. Niederbaumer Steven A. Niederbaumer Notary Public, State of Ohio My Commission Expires October 26, 1999 EXHIBIT A Page 1 of 1 The Union Light, Heat and Power Company Summary Principal Amount: Up to $55 million of first mortgage bonds (the New Bonds) or unsecured indebtedness (the New Notes), or any combination thereof, in one or more series. Maturity: Up to 40 years for the New Bonds and the New Notes. Purpose: To refund outstanding obligations or for other general corporate purposes. Lead Underwriters: To be named. Underwriting Commissions or Agents' Fees: Not to exceed 1.25% of the principal amount. Price to Public: No higher than 101 1/2% nor less than 98% of the principal amount, plus accrued interest, if any. Interest Rate: For securities with a maturity of 10 years or less, not to exceed 150 basis points above the yield to maturity on United States Treasury Notes of comparable maturity at the time of pricing. For securities with a maturity of more than 10 years, not in excess of 200 basis points above the yield to maturity on United States Treasury Bonds of comparable maturity at the time of pricing. EXHIBIT B FINANCIAL EXHIBIT Page 1 of 6 THE UNION LIGHT, HEAT AND POWER COMPANY ---------------------------------------- FINANCIAL EXHIBIT December 31, 1994 807 KAR 5:001, SECTION 6 (1.) Amount and kinds of stock authorized. 1,000,000 shares of Capital Stock $15 per share par value amounting to $15,000,000 par value. (2.) Amount and kinds of stock issued and outstanding. 585,333 shares of Capital Stock $15 per share par value amounting to $8,779,995 total par value plus premiums thereon of $18,838,946. (3.) Terms of preference of preferred stock whether cumulative or participating, or on dividends or assets or otherwise. There is no preferred stock authorized, issued or outstanding. (4.) Brief description of each mortgage on property of applicant, giving date of execution, name of mortgagor, name of mortgagee, or trustee, amount of indebtedness authorized to be secured thereby, and the amount of indebtedness actually secured, together with any sinking fund provisions. The Union Light, Heat and Power Company, as of February 1, 1949, executed its "First Mortgage" to The Bank of New York, Trustee, as security for the issuance of First Mortgage Bonds. As of October 1, 1951, it executed the "First Supplemental Indenture," as of May 1, 1954, the "Second Supplemental Indenture," as of July 1, 1959, the "Third Supplemental Indenture," as of July 1, 1963, the "Fourth Supplemental Indenture," as of June 1, 1970, the "Sixth Supplemental Indenture," as of October 1, 1973, the "Seventh Supplemental Indenture," as of December 1, 1978, the "Eighth Supplemental Indenture," as of December 15, 1981, the "Ninth Supplemental Indenture," as of July 1, 1989, the "Tenth Supplemental Indenture," as of June 1, 1990, the "Eleventh Supplemental Indenture," as of November 15, 1990, the "Twelfth Supplemental Indenture," and as of August 1, 1992, the "Thirteenth Supplemental Indenture," to said First Mortgage for the issuance of additional First Mortgage Bonds. The Company redeemed the First Mortgage Bonds issued under the First Supplemental Indenture on October 1, 1981, the Second Supplemental Indenture on May 1, 1984, the Third Supplemental Indenture on July 1, 1989, the Fourth Supplemental Indenture on July 1, 1993, the Sixth Supplemental Indenture on September 30, 1977 and the Ninth Supplemental Indenture on December 15, 1990. The Company also executed a "Fifth Supplemental Indenture" as of January 1, 1967, changing certain provisions of the Mortgage. This mortgage, as amended, in the opinion of counsel for the Company, constitutes a direct first lien on all the property of the Company except rents, earnings, revenues, income or profit of the mortgaged property, cash, accounts receivable, supplies, etc. used in or held for the operation of the business. The aggregated principal amount of said Bonds at any time outstanding which may be secured by said First Mortgage presently is limited to $200,000,000. As of December 31, 1994, the Company had issued and outstanding $90,000,000 principal amount of First Mortgage Bonds secured under the terms of the Mortgage Indenture, as amended. An Improvement and Sinking Fund provision contained in the Mortgage provides, with respect to all series of Bonds issued prior to 1981, in general, that on or before April 30, of each year, the Company will deposit with the Trustee an amount in cash and/or a principal amount of bonds equal in the aggregate to 1% of (a) the greatest aggregate principal amount of bonds of the applicable series theretofore outstanding at any one time less (b) the aggregate principal amount of bonds retired by the use of money received in consideration of any release by the Trustee; however, the Company may credit 60% of the lesser of cost or fair value of unfunded property additions against the amounts otherwise to be so deposited. EXHIBIT B FINANCIAL EXHIBIT Page 2 of 6 (5.) Amount of bonds authorized, and amount issued, giving the name of the public utility which issued the same, describing each class separately, and giving date of issue, face value, rate of interest, date of maturity and how secured, together with amount of interest paid thereon during the last fiscal year. The First Mortgage as amended, presently limits the principal amount of bonds which can be outstanding at any one time to $200,000,000. The Company has outstanding First Mortgage Bonds, all of which are secured by the First Mortgage, as amended, of the Company to The Bank of New York, as Trustee, as follows:
Date of Principal Amount Rate of Date of Interest Paid Indenture Issue Auth. & Issued Interest Maturity Year 1994 ---------- ------- ---------------- -------- -------- ------------- 7th Supplement 10/ 1/73 $ 10,000,000 8 % 10/ 1/03 $ 800,000 8th Supplement 12/ 1/78 10,000,000 9-1/2% 12/ 1/08 950,000 10th Supplement 7/ 1/89 20,000,000 9.70 % 7/ 1/19 1,940,000 11th Supplement 6/ 1/90 15,000,000 10-1/4% 6/ 1/20 1,537,500 12th Supplement 11/15/90 15,000,000 10-1/4% 11/15/20 1,537,500 13th Supplement 8/ 1/92 20,000,000 6-1/2% 8/ 1/99 1,300,000 ----------- ---------- $90,000,000 $8,065,000 =========== ==========
(6.) Each note outstanding, giving date of issue, amount, date of maturity, rate of interest, in whose favor, together with amount of interest paid thereon during the last fiscal year.
Date of Date of Rate of Interest Paid Payee Issue Amount Maturity Interest Year 1994 ------ -------- ------ -------- --------- ------------- National City 12/21/94 $1,000,000 1/ 5/95 6.25% - PNC 12/28/94 2,000,000 1/ 6/95 6.77% - Society 12/30/94 2,500,000 1/ 9/95 6.04% - Society 12/30/94 2,500,000 1/11/95 6.06% - National City 12/30/94 3,000,000 1/13/95 6.15% - Fifth Third 12/30/94 3,500,000 1/18/95 5.87% -
(7.) Other indebtedness, giving same by classes and describing security, if any, with a brief statement of the devolution or assumption of any portion of such indebtedness upon or by person or corporation if the original liability has been transferred, together with amount of interest paid thereon during the last fiscal year. The Company had no other indebtedness. (8.) Rate and amount of dividends paid during the five (5) previous fiscal years, and the amount of capital stock on which dividends were paid each year.
Dividends Paid --------------------------- No. of Par Value Year Ending Per Share Total Shares of Stock ----------- --------- ----- ------ --------- December 31, 1990 $3.00 $1,455,999 485,333 $7,279,995 December 31, 1991 5.00 2,426,665 485,333 7,279,995 December 31, 1992 - - 585,333 8,779,995 December 31, 1993 5.00 2,926,665 585,333 8,779,995 December 31, 1994 6.00 3,511,998 585,333 8,779,995
(9.) Detailed Income Statement and Balance Sheet. See attached pages 3 through 6 of Financial Exhibit for detailed income statement for the twelve months ended December 31, 1994 and detailed balance sheet as of December 31, 1994.
EXHIBIT B FINANCIAL EXHIBIT Page 3 of 6 THE UNION LIGHT, HEAT AND POWER COMPANY INCOME STATEMENT FOR THE 12 MONTHS ENDED DECEMBER 31, 1994 Operating Revenues: Electric $177,564,321 Gas 71,971,079 ------------ Total operating revenues 249,535,400 ------------ Operating Expenses: Electricity purchased from parent company for resale 134,887,413 Gas purchased 40,508,182 Other operation 31,809,220 Maintenance 5,472,881 Provision for depreciation 11,123,913 Taxes other than income taxes 4,001,686 Federal income taxes 2,791,109 State income taxes 509,099 Deferred income taxes - net 2,329,051 Investment tax credits - net (286,814) ------------ Total operating expenses 233,145,740 ------------ Operating Income 16,389,660 ------------ Other Income and Deductions: Allowance for other funds used during construction 78,015 Other income and deductions - net 292,873 ------------ Total other income and deductions 370,888 ------------ Income Before Interest Charges 16,760,548 ------------ Interest Charges Interest on long-term debt 8,065,000 Other interest 395,259 Amortization of debt discount, premium and other 95,608 Allowance for borrowed funds used during construction - credit (182,525) ------------ Net interest charges 8,373,342 ------------ Net Income $ 8,387,206 ============ The accompanying note is an integral part of the above statement.
EXHIBIT B FINANCIAL EXHIBIT Page 4 of 6 THE UNION LIGHT, HEAT AND POWER COMPANY BALANCE SHEET DECEMBER 31, 1994 ASSETS ------- Utility Plant: Utility plant $340,960,350 Less accumulated provisions for depreciation 104,112,606 ------------ Net utility plant 236,847,744 ------------ Current Assets: Cash 1,070,768 Accounts receivable, less accumulated provision of $457,429 for doubtful accounts 23,119,812 Accrued unbilled revenues 10,772,188 Materials and supplies, at average cost Gas stored for current use 6,215,347 Other materials and supplies 1,406,273 Property taxes applicable to subsequent year 2,200,000 Prepayments and other 593,493 ------------ Total current assets 45,377,881 ------------ Other Assets: Regulatory assets - deferred merger costs 1,785,351 Other 3,117,063 ------------ 4,902,414 ------------ $287,128,039 ============ The accompanying note is an integral part of the above statement.
EXHIBIT B FINANCIAL EXHIBIT Page 5 of 6 THE UNION LIGHT, HEAT AND POWER COMPANY BALANCE SHEET DECEMBER 31, 1994 LIABILITIES ----------- Shareholders' equity: Capital shares, $15 par value - Authorized - 1,000,000 shares Outstanding - 585,000 shares $ 8,779,995 Premium on capital shares 18,838,946 Retained earnings 74,202,563 ------------ Total shareholders' equity 101,821,504 ------------ First Mortgage Bonds: 8 % series due 2003 10,000,000 9-1/2% series due 2008 10,000,000 9.70 % series due 2019 20,000,000 10-1/4% series due 2020 30,000,000 6-1/2% series due 1999 20,000,000 Unamortized premium (discount) - net (761,581) ------------ Total long-term debt 89,238,419 ------------ Current Liabilities: Notes payable - bank 14,500,000 Accounts payable 6,048,491 Accounts payable to associated companies - net 15,606,102 Accrued taxes 2,876,244 Accrued interest on debt 2,123,326 Other current and accrued liabilities 4,122,409 ------------ 45,276,572 ------------ Deferred Credits and Other: Deferred income taxes 23,225,536 Investment tax credits 5,364,376 Income taxes refundable through rates 4,282,159 Accrued pension and other postretirement costs 10,355,915 Other 7,563,558 ------------ Total deferred credits and other 50,791,544 ------------ $287,128,039 ============ The accompanying note is an integral part of the above statement.
EXHIBIT B FINANCIAL EXHIBIT Page 6 of 6 THE UNION LIGHT, HEAT AND POWER COMPANY NOTE TO FINANCIAL STATEMENTS DECEMBER 31, 1994 1. Utility plant is stated at original cost which does not represent its present day replacement or realizable value. The Kentucky statutes expressly authorize the Kentucky Public Service Commission to ascertain, for rate making purposes, the value of the property of any public utility and provide that, in making any such valuation, the Commission shall give due consideration to the history and development of the utility and its property, original cost, cost of reproduction as a going concern, and other elements of value recognized by the law of the land for rate making purposes. EX-99.D.3 4 ORDER FROM THE PUBLIC UTILITIES OF OHIO THE PUBLIC UTILITIES COMMISSION OF OHIO In the Matter of the Application of ) The Cincinnati Gas & Electric Company ) for Authority to Issue and Sell up to ) Case No. 95-273-GE-AIS $500 Million of First Mortgage Bonds, ) Secured Medium Term Notes, Senior ) Unsecured Debt, or Junior Unsecured ) Subordinated Debt ) FINDING AND ORDER The Commission finds: (1) Applicant, an Ohio corporation, is a public utility as defined in Section 4905.02, Revised Code, and is subject to the jurisdiction of this Commission. (2) The Application is filed under the provisions of Sections 4905.40 and 4905.41, Revised Code. (3) Applicant proposes to issue and sell, through March 31, 1996, not more than $500 million aggregate principal amount of first mortgage bonds (the "New Bonds"), secured medium term notes (the "Notes"), senior unsecured indebtedness (the "Senior Debentures"), or junior unsecured subordinated indebtedness (the "Subordinated Debt"), or any combination thereof (collectively referred as "the Securities"), in one or more series, consistent with the parameters as set forth in the Application and Exhibits. (4) The New Bonds and the Notes will be issued under and secured by the First Mortgage Indenture dated August 1, 1936, between Applicant and The Bank of New York, Trustee, as previously amended and supplemented, and to be further supplemented by one or more supplemental indentures. The Senior Debentures and the Subordinated Debt will be issued under a loan agreement or similar document, or an indenture or indentures, as described in the Application. (5) Applicant proposes to either (a) sell the Securities to one or more underwriters through a negotiated offering, or (b) sell the securities through a competitive bidding process, as described in the Application. (6) The proposed guidelines or parameters set forth in the Application are intended to facilitate the issuance of the Securities on the best terms possible and at the lowest cost. The authorization of the sale of the Securities within the parameters set forth in the Application in no way relieves the Applicant of its responsibilities to negotiate and obtain the best terms available. (7) The proceeds from the issuance of the Securities will be used to refund a portion of Applicant's outstanding debt and preferred stock and for other general corporate purposes, pursuant to Section 4905.40, Revised Code. (8) The effect on the Applicant's revenue requirements resulting from the issuance of the Securities will be reflected in the determination of required revenue in rate proceedings in which all factors affecting rates are taken into account according to law. (9) The maximum amount of the Securities, the probable cost, price to Applicant, and other terms thereof, within the parameters set forth in the Application and Exhibits, to be determined by means of private arm's length negotiations or through competitive bidding, do not appear to be unjust or unreasonable. (10) Based on information contained in the Application, the exhibits thereto, and other documentary information to which the Commission has access, the purposes to which the proceeds from the Securities shall be applied appear to be reasonably required by the Applicant to meet its present and prospective obligations to provide utility service and the Commission is satisfied that consent and authority should be granted. It is, therefore, ORDERED, That The Cincinnati Gas & Electric Company is authorized to issue and sell, in one or more series, through March 31, 1996, not more than $500 million aggregate principal amount of first mortgage bonds, secured medium term notes, senior unsecured indebtedness or junior unsecured subordinated indebtedness, or any combination thereof, consistent with the parameters as set forth in the Application and Exhibits. It is, further, ORDERED, That Applicant is authorized to apply the net proceeds from the sale of the Securities for the purposes set forth in this Order and otherwise pursuant to Section 4905.40, Revised Code. It is, further, ORDERED, That after the Securities authorized by this Order are issued, Applicant shall report to this Commission as soon as practicable the terms and full particulars regarding each sale of the Securities and shall file with the Commission the executed copy of the loan agreement or similar documents, or an indenture or indentures, as applicable. It is, further, ORDERED, That Applicant shall account for the issuance of the Securities as prescribed by the Federal Energy Regulatory Commission Uniform System of Accounts as currently in effect. It is, further, ORDERED, That nothing in this Order shall be construed to imply any guaranty or obligation by the Commission to assure completion of any specific construction project of the Applicant. It is, further, ORDERED, That nothing in this Order shall be construed to imply any guaranty, or obligation as to the Securities, or the associated interest, on the part of the State of Ohio. It is, further, ORDERED, That nothing in this Order shall be deemed to be binding upon this Commission in any future proceeding or investigation involving the justness or reasonableness of any rate, charge, rule or regulation of the Applicant. It is, further, ORDERED, That a copy of this Order be served upon all parties of record. THE PUBLIC UTILITIES COMMISSION OF OHIO /s/ Craig A. Glazer Craig A. Glazer, Chairman /s/ J. Michael Biddison /s/ Jolynn Barry Butler J. Michael Biddison Jolynn Barry Butler /s/ Richard M. Fanelly /s/ David W. Johnson Richard M. Fanelly David W. Johnson EX-99.G 5 FORM OF NOTICE EXHIBIT G SECURITIES AND EXCHANGE COMMISSION (Release No. 35- ) Filings Under the Public Utility Holding Company Act of 1935 ("Act") April __, 1995 Notice is hereby given that the following filing(s) has/have been made with the Commission pursuant to provisions of the Act and rules promulgated thereunder. All interested persons are referred to the application(s) and/or declaration(s) for complete statements of the proposed transaction(s) summarized below. The application(s) and/or declaration(s) and any amendment(s) thereto is/are available for public inspection through the Commission's Office of Public Reference. Interested persons wishing to comment or request a hearing on the application(s) and/or declaration(s) should submit their views in writing by May 8, 1995, to the Secretary, Securities and Exchange Commission, Washington, D.C. 20549, and serve a copy on the relevant applicant(s) and/or declarant(s) at the address specified below. Proof of service (by affidavit, or, in case of an attorney at law, by certificate) should be filed with the request. Any request for hearing shall identify specifically the issues of fact or law that are disputed. A person who so requests will be notified of any hearing, if ordered, and will receive a copy of any notice or order issued in the matter. After said date, the application(s) and/or declaration(s), as filed or as amended, may be granted and/or permitted to become effective. CINergy Corp. et al. (File No. 70- ) The Cincinnati Gas & Electric Company (CG&E), a utility company and wholly-owned subsidiary of CINergy Corp. (CINergy), a registered holding company, and CG&E's wholly-owned subsidiary, The Union Light, Heat and Power Company (Union Light), a utility company and an affiliate of CINergy, all of 139 East Fourth Street, Cincinnati, Ohio 45202, have filed an application-declaration under sections 6(a) and 7 of the Act. CG&E seeks authorization to issue and sell from time to time through March 31, 1996, an aggregate principal amount not to exceed $500 million of a combination of senior unsecured indebtedness (the Senior Debentures) and junior unsecured subordinated indebtedness (the Junior Securities). In addition, Union Light sees authorization to issue and sell, from time to time through March 31, 1997, an aggregate principal amount not to exceed $55 million of unsecured indebtedness (the Union Debentures). The Senior Debentures and the Union Debentures are hereinafter referred to collectively as "the Senior Securities", and the Senior and Junior Securities are hereinafter referred to collectively as "the Securities". CG&E and Union Light are sometimes hereinafter referred to individually as an "Operating Affiliate" and collectively as the "Operating Affiliates." The Operating Affiliates, in conjunction with potential underwriters, have developed parameters under which the Securities are to be sold. The parameters, as hereinafter discussed, are designed to provide a reasonable allowance for potential changes in financial market conditions between the time of Commission authorization and the actual sale of the Securities. The parameters allow each Operating Affiliate to sell the Securities on any day when it believes it is prudent to do so provided the terms are within the parameters. The Operating Affiliates have several high coupon series of first mortgage bonds that are, or will shortly become, optionally redeemable and can be re-financed through the issuance of lower cost debt. Proceeds from the sale of the Senior Securities will be used directly or indirectly to refund some or all of redeemable high-coupon debt issues. Any balance of net proceeds from the sale of the Senior Securities will be used for general corporate purposes. None of such proceeds will be used by CG&E or Union Light to acquire, directly or indirectly, an interest in an exempt wholesale generator (EWG) or foreign utility company (FUCO) as defined in the Act. The Senior Securities (1) will be issued at a price no higher than 101.5% nor less than 98% of the principal amount, plus accrued interest, if any, with underwriting commissions and agents' fees not to exceed 1.25% of the principal amount, (2) may be issued in one or more new series for terms not to exceed 40 years, and (3) will be issued at an interest rate which results in a yield to maturity to the purchaser at the initial offering price, depending on the maturity of the Security issued, of up to a maximum of (a) 225 basis points for the Senior Debentures, or (b) 200 basis points for the Union Debentures, over the yield to maturity on United States Treasury Notes and United States Treasury Bonds of comparable maturities. Interest on the Senior Securities will be paid on a semi-annual basis. CG&E currently has preferred stock that is or will become optionally redeemable. Proceeds from the sale of the Junior Securities are anticipated to be used directly or indirectly to redeem outstanding preferred stock. Any balance of net proceeds from the sale of the Junior Securities will be used for general corporate purposes. None of such proceeds will be used by CG&E to acquire, directly or indirectly, an interest in an EWG or FUCO as defined in the Act. The Junior Securities (1) will be issued at a price no higher than 101.5% nor less than 98% of the principal amount, plus accrued interest, if any, with underwriting commissions and agents' fees not to exceed 3.50% of the principal amount, (2) may be issued in one or more new series for terms not to exceed 40 years, and (3) will be issued at an interest rate which results in a yield to maturity to the purchaser at the initial offering price, depending on the maturity of the Security issued, of up to a maximum of 225 basis points over the yield to maturity on United States Treasury Notes and United States Treasury Bonds of comparable maturities. Interest on the Junior Securities will be paid on either a monthly, quarterly, semi-annual or annual basis, and CG&E may have the right to defer payment of interest on its Junior Securities for up to five years under certain situations. For each offering of the Securities, the Operating Affiliates propose to either (a) sell the Securities to one or more underwriters through a negotiated offering or (b) sell the Securities through a competitive bidding process. In the event one or more series of the Securities are sold through a negotiated offering, the terms of such Securities will be negotiated by the Operating Affiliate(s) either with a group of underwriters headed by managing underwriters or with one or more underwriters, with a limited number of purchasers or with a single purchaser for a direct sale or for a sale through agents. If one or more series of the Securities are sold through competitive bidding, such Securities will be sold to the bidder(s) whose proposal results in the lowest annual cost of money, with the Operating Affiliate(s) having the right to reject any or all bids. Each of the bidders will be required to specify the coupon rate and the price, exclusive of accrued interest, to be paid for the Securities. The redemption premiums with respect to the Securities will also be established as a result of the negotiations or as part of a competitive bidding process. After approval of the terms for each offering by each Operating Affiliate's Board of Directors, by an authorized committee thereof, or by persons authorized by the Operating Affiliate's Board of Directors, it is anticipated that an underwriting agreement setting forth the terms of the Securities of that offering would be executed. It is expected that a new indenture would be used by each Operating Affiliate for the respective Securities issued by that Operating Affiliate. A separate supplemental indenture would be executed by the respective Operating Affiliate covering terms of the Securities from each offering. The indenture will provide that, unless otherwise provided in a supplemental indenture or a Board Resolution, the Securities will be subordinate and subject in right of payment to the prior payment in full of all secured obligations of the respective Operating Affiliate, with the Junior Securities being junior in such rights to the Senior Debentures, whether outstanding as of the date of each indenture or thereafter incurred. The Securities will have no cross-default provisions with respect to other indebtedness of each Operating Affiliate or between Operating Affiliates. For the Commission, by the Division of Investment Management, pursuant to delegated authority. Jonathan G. Katz, Secretary EX-99.FS.1 6 CG&E UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET
Exhibit FS-1 Financial Statements Page 1 of 2 THE CINCINNATI GAS & ELECTRIC COMPANY PRO FORMA CONSOLIDATED BALANCE SHEET AT DECEMBER 31, 1994 ASSETS Pro Forma Actual Adjustments Pro Forma ------------ ----------- ------------ (dollars in thousands) ASSETS UTILITY PLANT - ORIGINAL COST In service Electric $ 4,502,840 $ 4,502,840 Gas 645,602 645,602 Common 185,718 185,718 ------------ ------------ 5,334,160 5,334,160 Accumulated depreciation 1,613,505 1,613,505 ------------ ------------ 3,720,655 3,720,655 Construction work in progress 74,989 74,989 ------------ ------------ Total utility plant 3,795,644 3,795,644 ------------ ------------ CURRENT ASSETS Cash and temporary cash investments 52,516 $ 26,409 78,925 Restricted deposits 98 98 Accounts receivable less accumulated provision of $8,999,410 for doubtful accounts 269,020 269,020 Materials, supplies and fuel -- at average cost Fuel for use in electric production 42,167 42,167 Gas stored for current use 31,284 31,284 Other materials and supplies 57,864 57,864 Property taxes applicable to subsequent year 112,420 112,420 Prepayments and other 31,327 31,327 ------------ ----------- ------------ 596,696 26,409 623,105 ------------ ----------- ------------ OTHER ASSETS Regulatory Assets Post-in-service carrying costs and deferred operating expenses 155,138 155,138 Phase-in deferred return and depreciation 100,943 100,943 Deferred demand-side management costs 10,002 10,002 Amounts due from customers -- income taxes 381,380 381,380 Deferred merger costs 12,013 12,013 Unamortized costs of reacquiring debt 33,426 32,413 65,839 Other 55,987 55,987 Other 40,436 (682) 39,754 ------------ ----------- ------------ 789,325 31,731 821,056 ------------ ----------- ------------ $ 5,181,665 $ 58,140 $ 5,239,805 ============ =========== ============ The Pro Forma Adjustments are shown on Exhibit FS-4 of this filing.
Exhibit FS-1 Financial Statements Page 2 of 2 THE CINCINNATI GAS & ELECTRIC COMPANY PRO FORMA CONSOLIDATED BALANCE SHEET AT DECEMBER 31, 1994 CAPITALIZATION AND LIABILITIES Pro Forma Actual Adjustments Pro Forma ------------ ------------- ------------ (dollars in thousands) COMMON STOCK EQUITY Common stock - $8.50 par value; Authorized shares - 120,000,000 Outstanding shares - 89,663,086 $ 762,136 $ 762,136 Paid-in capital 337,874 $ 1,261 339,135 Retained earnings 432,962 (3,042) 429,920 ------------ ------------- ------------ Total common stock equity 1,532,972 (1,781) 1,531,191 CUMULATIVE PREFERRED STOCK Not subject to mandatory redemption 80,000 (40,000) 40,000 Subject to mandatory redemption 210,000 (50,000) 160,000 LONG-TERM DEBT 1,837,757 149,921 1,987,678 ------------ ------------- ------------ Total capitalization 3,660,729 58,140 3,718,869 ------------ ------------- ------------ CURRENT LIABILITIES Notes payable 14,500 14,500 Accounts payable 120,817 120,817 Accrued taxes 227,651 227,651 Accrued interest 31,902 31,902 Other 32,658 32,658 ------------ ------------ 427,528 427,528 ------------ ------------ OTHER LIABILITIES Deferred income taxes 747,060 747,060 Unamortized investment tax credits 135,417 135,417 Accrued pension and other postretirement benefit costs 102,254 102,254 Other 108,677 108,677 ------------ ------------ 1,093,408 1,093,408 ------------ ------------- ------------ $ 5,181,665 $ 58,140 $ 5,239,805 ============ ============= ============ The Pro Forma Adjustments are shown on Exhibit FS-4 of this filing.
EX-99.FS.2 7 CG&E UNAUDITED PRO FORMA STATEMENT OF INCOME
Exhibit FS-2 Financial Statements Page 1 of 1 THE CINCINNATI GAS & ELECTRIC COMPANY PRO FORMA CONSOLIDATED STATEMENT OF INCOME TWELVE MONTHS ENDED DECEMBER 31, 1994 Pro Forma Actual Adjustments Pro Forma ------------ ------------- ------------ (in thousands, except per share amounts) OPERATING REVENUES Electric $ 1,345,787 $ 1,345,787 Gas 442,398 442,398 ------------ ----------- 1,788,185 1,788,185 ------------ ----------- OPERATING EXPENSES Fuel used in electric production 325,470 325,470 Gas purchased 248,293 248,293 Purchased and exchanged power 20,932 20,932 Other operation 336,030 336,030 Maintenance 106,810 106,810 Depreciation 156,676 156,676 Post-in-service deferred operating expenses -- net 3,290 3,290 Phase-in deferred depreciation (2,161) (2,161) Income taxes 104,128 $ (3,167) 100,961 Taxes other than income taxes 197,381 197,381 ------------ ------------- ----------- 1,496,849 (3,167) 1,493,682 ------------ ------------- ----------- OPERATING INCOME 291,336 3,167 294,503 ------------ ------------- ----------- OTHER INCOME AND EXPENSES - NET Allowance for equity funds used during construction 1,971 1,971 Phase-in deferred return 15,351 15,351 Income taxes 6,619 6,619 Other - net (6,726) (6,726) ------------ ----------- 17,215 17,215 ------------ ------------- ----------- INCOME BEFORE INTEREST 308,551 3,167 311,718 ------------ ------------- ----------- INTEREST Interest on long-term debt 150,386 9,049 159,435 Other interest 2,831 2,831 Allowance for borrowed funds used during construction (2,977) (2,977) ------------ ------------- ----------- 150,240 9,049 159,289 ------------ ------------- ----------- NET INCOME 158,311 (5,882) 152,429 PREFERRED DIVIDEND REQUIREMENT 22,377 (7,551) 14,826 ------------ ------------- ----------- INCOME APPLICABLE TO COMMON STOCK $ 135,934 $ 1,669 $ 137,603 ============ ============= =========== The Pro Forma Adjustments are shown on Exhibit FS-4 of this filing.
EX-99.FS.3 8 CG&E UNAUDITED PRO FORMA STATEMENT OF RETAINED EARNINGS
Exhibit FS-3 Financial Statements Page 1 of 1 THE CINCINNATI GAS & ELECTRIC COMPANY PRO FORMA CONSOLIDATED STATEMENT OF CHANGES IN RETAINED EARNINGS TWELVE MONTHS ENDED DECEMBER 31, 1994 Pro Forma Actual Adjustments Pro Forma ------------ ---------- ---------- (dollars in thousands) Balance, December 31, 1993 $ 456,511 $ 456,511 Net income 158,311 $ (5,882) 152,429 Dividends on preferred stock (22,377) 7,551 (14,826) Dividends on common stock (158,970) (158,970) Other (513) (4,711) (5,224) ------------ ---------- ---------- Balance, December 31, 1994 $ 432,962 $ (3,042) $ 429,920 ============ ========== ========== The Pro Forma Adjustments are shown on Exhibit FS-4 of this filing.
EX-99.FS.4 9 CG&E PRO FORMA JOURNAL ENTRIES Exhibit FS-4 Financial Statements Page 1 of 12 THE CINCINNATI GAS & ELECTRIC COMPANY PRO FORMA CONSOLIDATED JOURNAL ENTRIES TO GIVE EFFECT TO THE ISSUANCE OF UP TO $555 MILLION OF DEBT SECURITIES AND RELATED REDEMPTION OF OUTSTANDING DEBT AND PREFERRED SECURITIES Debit Credit ------------- ------------- 1) Cash $ 500,000,000 Long-term debt - Senior Debentures $ 400,000,000 Long-term debt - Junior Securities $ 100,000,000 To record the issuance and sale of $500,000,000 principal amount of unsecured debt for The Cincinnati Gas & Electric Company (CG&E). 2) Cash $ 55,000,000 Long-term debt - Union Debentures $ 55,000,000 To record the issuance and sale of $55,000,000 principal amount of unsecured debt by The Union Light, Heat and Power Company (Union Light). 3) Discount on long-term debt $ 8,500,000 Cash $ 8,500,000 To record the maximum issuance expenses for CG&E on unsecured debt at 1.25% of the principal amount of Senior Debentures, and 3.50% of the principal amount for Junior Securities. 4) Discount on long-term debt $ 687,500 Cash $ 687,500 To record the maximum issuance expenses for Union Light on unsecured debt at 1.25% of the principal amount of Union Debentures. 5) Pref. stock - Not subject to mandatory redemp. $ 40,000,000 Pref. stock - Subject to mandatory redemp. $ 50,000,000 Cash $ 90,000,000 To record CG&E's retirement of Cumulative Preferred Stock, 7.44% and 9.15% Series. Exhibit FS-4 Financial Statements Page 2 of 12 THE CINCINNATI GAS & ELECTRIC COMPANY PRO FORMA CONSOLIDATED JOURNAL ENTRIES TO GIVE EFFECT TO THE ISSUANCE OF UP TO $555 MILLION OF DEBT SECURITIES AND RELATED REDEMPTION OF OUTSTANDING DEBT AND PREFERRED SECURITIES Debit Credit ------------- ------------- 6) Retained earnings $ 3,450,000 Cash $ 3,450,000 To record CG&E's charge to retained earnings for redemption premiums on retirement of Cumulative Preferred Stock, 7.44% and 9.15% Series. Calculations are as follows: Redemption Price Redemption Balance Per Share Premium ------------- ------------- ------------- Cumulative Preferred Stock: 7.44% Series $ 40,000,000 $ 101.00 $ 400,000 9.15% Series 50,000,000 $ 106.10 3,050,000 ------------- ------------- $ 90,000,000 $ 3,450,000 ============= ============= 7) Retained earnings $ 1,260,627 Paid-in capital $ 1,260,627 To record CG&E's write-off of issuance expense to retained earnings on retired Cumulative Preferred Stock, 7.44% and 9.15% Series. Calculations are as follows: Issuance Expense ------------- Cumulative Preferred Stock: 7.44% Series $ 531,553 9.15% Series 729,074 ------------- $ 1,260,627 ============= Exhibit FS-4 Financial Statements Page 3 of 12 THE CINCINNATI GAS & ELECTRIC COMPANY PRO FORMA CONSOLIDATED JOURNAL ENTRIES TO GIVE EFFECT TO THE ISSUANCE OF UP TO $555 MILLION OF DEBT SECURITIES AND RELATED REDEMPTION OF OUTSTANDING DEBT AND PREFERRED SECURITIES Debit Credit ------------- ------------- 8) Long-term debt $ 350,000,000 Cash $ 350,000,000 To record CG&E's redemption of $100 million principal amount of First Mortgage Bonds, 10-1/8% Series Due 2020, $150 million principal amount of First Mortgage Bonds, 10.20% Series Due 2020, and $100 million principal amount of First Mortgage Bonds, 9.70% Series Due 2019, by CG&E. 9) Long-term debt $ 50,000,000 Cash $ 50,000,000 To record Union Light's redemption of $15 million principal amount of First Mortgage Bonds, 10-1/4% Series Due June 1, 2020, $15 million principal amount of First Mortgage Bonds, 10-1/4% Series Due November 15, 2020, and $20 million principal amount of First Mortgage Bonds, 9.70% Series Due July 1, 2019. Exhibit FS-4 Financial Statements Page 4 of 12 THE CINCINNATI GAS & ELECTRIC COMPANY PRO FORMA CONSOLIDATED JOURNAL ENTRIES TO GIVE EFFECT TO THE ISSUANCE OF UP TO $555 MILLION OF DEBT SECURITIES AND RELATED REDEMPTION OF OUTSTANDING DEBT AND PREFERRED SECURITIES Debit Credit ------------- ------------- 10)Unamortized loss on reacquired debt $ 29,402,907 Discount on long-term debt $ 3,398,247 Unamortized debt expense $ 444,660 Cash $ 25,560,000 To record CG&E's loss on redemption of $100 million principal amount of First Mortgage Bonds, 10-1/8% Series Due 2020 at 107.27%, $150 million principal amount of First Mortgage Bonds, 10.20% Series Due 2020 at 107.44%, and $100 million principal amount of First Mortgage Bonds, 9.70% Series Due 2019 at 107.13%. Calculations are as follows: 10-1/8% 10.20% 9.70% Series Due Series Due Series Due 2020 2020 2019 Total ------------- ------------- ------------- ------------- Princ. amount $ 100,000,000 $ 150,000,000 $ 100,000,000 $ 350,000,000 Discount on long-term debt 1,089,900 1,443,900 864,447 3,398,247 Unamort. debt expense 149,100 156,600 138,960 444,660 ------------- ------------- ------------- ------------- Carrying amount $ 98,761,000 $ 148,399,500 $ 98,996,593 $ 346,157,093 ============= ============= ============= ============= Redemp. price % 107.27% 107.44% 107.13% Redemp. price $ 107,270,000 $ 161,160,000 $ 107,130,000 $ 375,560,000 Estimated loss on redemption $ 8,509,000 $ 12,760,500 $ 8,133,407 $ 29,402,907 Exhibit FS-4 Financial Statements Page 5 of 12 THE CINCINNATI GAS & ELECTRIC COMPANY PRO FORMA CONSOLIDATED JOURNAL ENTRIES TO GIVE EFFECT TO THE ISSUANCE OF UP TO $555 MILLION OF DEBT SECURITIES AND RELATED REDEMPTION OF OUTSTANDING DEBT AND PREFERRED SECURITIES Debit Credit ------------- ------------- 11)Unamortized loss on reacquired debt $ 4,377,934 Discount on long-term debt $ 563,692 Unamortized debt expense $ 237,242 Cash $ 3,577,000 To record Union Light's loss on redemption of $15 million principal amount of First Mortgage Bonds, 10-1/4% Series Due June 1, 2020 at 107.34%, $15 million principal amount of First Mortgage Bonds, 10-1/4% Series Due November 15, 2020 at 107.20%, and $20 million principal amount of First Mortgage Bonds, 9.70% Series Due 2019 at 106.98%. Calculations are as follows: 10-1/4% 10-1/4% 9.70% Series Due Series Due Series Due June 1, 2020 Nov. 15, 2020 2019 Total ------------- -------------- ------------- ------------- Princ. amount $ 15,000,000 $ 15,000,000 $ 20,000,000 $ 50,000,000 Discount on long-term debt 167,400 191,680 204,612 563,692 Unamort. debt expense 72,300 80,265 84,677 237,242 ------------- ------------- ------------- ------------- Carrying amount $ 14,760,300 $ 14,728,055 $ 19,710,711 $ 49,199,066 ============= ============= ============= ============= Redemp. price % 107.34% 107.20% 106.98% Redemp. price $ 16,101,000 $ 16,080,000 $ 21,396,000 $ 53,577,000 Estimated loss on redemption $ 1,340,700 $ 1,351,945 $ 1,685,289 $ 4,377,934 Exhibit FS-4 Financial Statements Page 6 of 12 THE CINCINNATI GAS & ELECTRIC COMPANY PRO FORMA CONSOLIDATED JOURNAL ENTRIES TO GIVE EFFECT TO THE ISSUANCE OF UP TO $555 MILLION OF DEBT SECURITIES AND RELATED REDEMPTION OF OUTSTANDING DEBT AND PREFERRED SECURITIES Debit Credit ------------- ------------- 12)Interest on long-term debt $ 7,875,000 Cash $ 7,875,000 To record CG&E's increase in interest expense from issuing unsecured debt and retiring first mortgage bonds. Calculations are as follows: Assumed Interest Balance Interest Rate Expense ------------- ------------- ------------- Interest Expense Increase ------------------------- Senior debentures $ 400,000,000 8.50%$ 34,000,000 Junior securities $ 100,000,000 9.00% 9,000,000 ------------- Total increase 43,000,000 ------------- Interest Expense Decrease ------------------------- First Mortgage Bonds: 10-1/8% Series Due 2020 $ 100,000,000 10-1/8% 10,125,000 10.20% Series Due 2020 $ 150,000,000 10.20% 15,300,000 9.70% Series Due 2019 $ 100,000,000 9.70% 9,700,000 ------------- Total decrease 35,125,000 ------------- Net increase $ 7,875,000 ============= Exhibit FS-4 Financial Statements Page 7 of 12 THE CINCINNATI GAS & ELECTRIC COMPANY PRO FORMA CONSOLIDATED JOURNAL ENTRIES TO GIVE EFFECT TO THE ISSUANCE OF UP TO $555 MILLION OF DEBT SECURITIES AND RELATED REDEMPTION OF OUTSTANDING DEBT AND PREFERRED SECURITIES Debit Credit ------------- ------------- 13)Cash $ 340,000 Interest on long-term debt $ 340,000 To record Union Light's decrease in interest expense from issuing unsecured debt and retiring first mortgage bonds. Calculations are as follows: Assumed Interest Balance Interest Rate Expense ------------- ------------- ------------- Interest Expense Increase ------------------------- Union debentures $ 55,000,000 8.50%$ 4,675,000 ------------- Total increase 4,675,000 ------------- Interest Expense Decrease ------------------------- First Mortgage Bonds, 10-1/4% Series Due: June 1, 2020 $ 15,000,000 10-1/4% 1,537,500 November 15, 2020 $ 15,000,000 10-1/4% 1,537,500 First Mortgage Bonds, 9.70% Series Due 2019 $ 20,000,000 9.70% 1,940,000 ------------- Total decrease 5,015,000 ------------- Net decrease $ 340,000 ============= Exhibit FS-4 Financial Statements Page 8 of 12 THE CINCINNATI GAS & ELECTRIC COMPANY PRO FORMA CONSOLIDATED JOURNAL ENTRIES TO GIVE EFFECT TO THE ISSUANCE OF UP TO $555 MILLION OF DEBT SECURITIES AND RELATED REDEMPTION OF OUTSTANDING DEBT AND PREFERRED SECURITIES Debit Credit ------------- ------------- 14)Amortization of debt discount $ 146,149 Discount on long-term debt $ 146,149 To record CG&E's incremental increase in amortization of debt discount from issuing unsecured debt and retiring first mortgage bonds. Calculations are as follows: Maximum Issuance Issuance Balance Discount % Discount ------------- ------------- ------------- New Issues ---------- Senior debentures $ 400,000,000 1.25%$ 5,000,000 Junior securities $ 100,000,000 3.50% 3,500,000 ------------- $ 8,500,000 ============= Annual amortization based on an assumed 30 year amortization period $ 283,333 ============= Original Issuance Life of Annual Discount Issue Amortization ------------- ------------- ------------- Issues Redeemed --------------- First Mortgage Bonds: 10-1/8% Series Due 2020 $ 1,308,000 30 Years $ 43,596 10.20% Series Due 2020 $ 1,732,500 30 Years 57,756 9.70% Series Due 2019 $ 1,075,000 30 Years 35,832 ------------- $ 137,184 ============= Net increase in annual amortization $ 146,149 ============= Exhibit FS-4 Financial Statements Page 9 of 12 THE CINCINNATI GAS & ELECTRIC COMPANY PRO FORMA CONSOLIDATED JOURNAL ENTRIES TO GIVE EFFECT TO THE ISSUANCE OF UP TO $555 MILLION OF DEBT SECURITIES AND RELATED REDEMPTION OF OUTSTANDING DEBT AND PREFERRED SECURITIES Debit Credit ------------- ------------- 15)Amortization of debt discount $ 45 Discount on long-term debt $ 45 To record Union Light's incremental increase in amortization of debt discount from issuing unsecured debt and retiring first mortgage bonds. Calculations are as follows: Maximum Issuance Issuance Balance Discount % Discount ------------- ------------- ------------- Union debentures $ 55,000,000 1.25%$ 687,500 ============= Annual amortization based on an assumed 30 year amortization period $ 22,917 ============= Original Issuance Life of Annual Discount Issue Amortization ------------- ------------- ------------- Issues Redeemed --------------- First Mortgage Bonds 10-1/4% Series Due: June 1, 2020 $ 201,000 30 Years $ 6,696 November 15, 2020 $ 230,250 30 Years 7,680 First Mortgage Bonds, 9.70% Series Due 2019 $ 255,000 30 Years 8,496 ------------- $ 22,872 ============= Net increase in annual amortization $ 45 ============= Exhibit FS-4 Financial Statements Page 10 of 12 THE CINCINNATI GAS & ELECTRIC COMPANY PRO FORMA CONSOLIDATED JOURNAL ENTRIES TO GIVE EFFECT TO THE ISSUANCE OF UP TO $555 MILLION OF DEBT SECURITIES AND RELATED REDEMPTION OF OUTSTANDING DEBT AND PREFERRED SECURITIES Debit Credit ------------- ------------- 16)Amortization of loss on reacquired debt $ 1,189,672 Unamortized loss on reacquired debt $ 1,189,672 To record CG&E's amortization of loss on reacquired debt. Calculations are as follows: Loss on Assumed Reacquired Amortization Annual Debt Period Amortization ------------- ------------- ------------- First Mortgage Bonds: 10-1/8% Series Due 2020 $ 8,509,000 25 Years $ 340,360 10.20% Series Due 2020 $ 12,760,500 25 Years 510,420 9.70% Series Due 2019 $ 8,133,407 24 Years 338,892 ------------- $ 1,189,672 ============= 17)Amortization of loss on reacquired debt $ 177,926 Unamortized loss on reacquired debt $ 177,926 To record Union Light's amortization of loss on reacquired debt. Calculations are as follows: Loss on Assumed Reacquired Amortization Annual Debt Period Amortization ------------- ------------- ------------- First Mortgage Bonds, 10-1/4% Series Due: June 1, 2020 $ 1,340,700 25 Years $ 53,628 November 15, 2020 $ 1,351,945 25 Years 54,078 First Mortgage Bonds, 9.70% Series Due 2019 $ 1,685,289 24 Years 70,220 ------------- $ 177,926 ============= Exhibit FS-4 Financial Statements Page 11 of 12 THE CINCINNATI GAS & ELECTRIC COMPANY PRO FORMA CONSOLIDATED JOURNAL ENTRIES TO GIVE EFFECT TO THE ISSUANCE OF UP TO $555 MILLION OF DEBT SECURITIES AND RELATED REDEMPTION OF OUTSTANDING DEBT AND PREFERRED SECURITIES Debit Credit ------------- ------------- 18)Cash $ 7,551,000 Preferred dividends $ 7,551,000 To record the reduction in preferred dividends from CG&E's redemption of preferred stock. Calculations are as follows: Dividend Redemption Balance Rate Premium ------------- ------------- ------------- Cumulative Preferred Stock: 7.44% Series $ 40,000,000 7.44%$ 2,976,000 9.15% Series 50,000,000 9.15% 4,575,000 ------------- ------------- $ 90,000,000 $ 7,551,000 ============= ============= 19)Cash $ 3,223,787 Income tax expense $ 3,223,787 To record the impact on income tax expense from CG&E issuing unsecured debt and redeeming first mortgage bonds and preferred stock. Calculations are as follows: Increase (Decrease) to Income ------------- Interest expense $ (7,875,000) Amortization of discount on long-term debt (146,149) Amortization of loss on reacquired debt (1,189,672) ------------- Net impact on income $ (9,210,821) ============= Impact on income taxes at assumed rate of 35% $ (3,223,787) ============= Exhibit FS-4 Financial Statements Page 12 of 12 THE CINCINNATI GAS & ELECTRIC COMPANY PRO FORMA CONSOLIDATED JOURNAL ENTRIES TO GIVE EFFECT TO THE ISSUANCE OF UP TO $555 MILLION OF DEBT SECURITIES AND RELATED REDEMPTION OF OUTSTANDING DEBT AND PREFERRED SECURITIES Debit Credit ------------- ------------- 20)Income tax expense $ 56,710 Cash $ 56,710 To record the impact on income tax expense from Union Light issuing unsecured debt and redeeming first mortgage bonds. Calculations are as follows: Increase (Decrease) to Income ------------- Interest expense $ 340,000 Amortization of discount on long-term debt (45) Amortization of loss on reacquired debt (177,926) ------------- Net impact on income $ 162,029 ============= Impact on income taxes at assumed rate of 35% $ 56,710 ============= NOTE (a) Loss on redemptions will be capitalized and amortized over the shorter of (1) the remaining life of the issue redeemed, or (2) the life of the new issue. (b) A 30 year term for new issues has been assumed for pro-forma statement purposes only. Actual term of new issues may be up to 40 years. (c) Excess proceeds, if any, after redeeming securities will be used for general and corporate purposes. (d) For purposes of pro-forma financial statements, out-of-pocket issuance costs have been ignored. EX-99.FS.5 10 CG&E STATEMENT OF BONDABLE PROPERTY ADDITIONS Exhibit FS-5 Financial Statements Page 1 of 1 THE CINCINNATI GAS & ELECTRIC COMPANY STATEMENT OF BONDABLE PROPERTY ADDITIONS Balance of unbonded bondable property through December 31, 1993 available for issuance of bonds at March 30, 1995 $ 873,352,574 =============== NOTE: CG&E can issue first mortgage bonds in principal amounts equal to 60% of the cost or the then fair value to CG&E (whichever shall be less) of unbonded bondable property. In addition, CG&E is also permitted to issue first mortgage bonds on the basis of previously retired bonds under the terms of its First Mortgage. Currently, CG&E is able to issue up to $357 million of first mortgage bonds on the basis of previously retired bonds in addition to the amount issuable against unbonded bondable property reported above. If the Securities are issued as unsecured obligations, unbonded bondable property available for issuance of bonds will not be impacted by the proposed transaction. EX-99.FS.6 11 UNION LIGHT UNAUDITED PRO FORMA BALANCE SHEET
Exhibit FS-6 Financial Statements Page 1 of 2 THE UNION LIGHT, HEAT AND POWER COMPANY PRO FORMA BALANCE SHEET AT DECEMBER 31, 1994 ASSETS Pro Forma Actual Adjustments Pro Forma ----------- ------------ ---------- (dollars in thousands) UTILITY PLANT - ORIGINAL COST In service Electric $ 179,098 $ 179,098 Gas 134,103 134,103 Common 19,122 19,122 ----------- ---------- 332,323 332,323 Accumulated depreciation 104,113 104,113 ----------- ---------- 228,210 228,210 Construction work in progress 8,638 8,638 ----------- ---------- Total utility plant 236,848 236,848 ----------- ---------- CURRENT ASSETS Cash and temporary cash investments 1,071 $ 1,019 2,090 Accounts receivable less accumulated provision of $457,429 for doubtful accounts 33,892 33,892 Materials, supplies and fuel -- at average cost Gas stored for current use 6,216 6,216 Other materials and supplies 1,406 1,406 Property taxes applicable to subsequent year 2,200 2,200 Prepayments and other 593 593 ----------- ----------- ---------- 45,378 1,019 46,397 ----------- ----------- ---------- OTHER ASSETS Deferred merger costs 1,785 1,785 Other 3,117 3,962 7,079 ----------- ----------- ---------- 4,902 3,962 8,864 ----------- ----------- ---------- $ 287,128 $ 4,981 $ 292,109 =========== =========== ========== The Pro Forma Adjustments are shown on Exhibit FS-9 of this filing.
Exhibit FS-6 Financial Statements Page 2 of 2 THE UNION LIGHT, HEAT AND POWER COMPANY PRO FORMA BALANCE SHEET AT DECEMBER 31, 1994 CAPITALIZATION AND LIABILITIES Pro Forma Actual Adjustments Pro Forma ---------- ----------- ---------- (dollars in thousands) COMMON STOCK EQUITY Common stock - $15.00 par value; Authorized shares - 1,000,000 Outstanding shares - 585,333 $ 8,780 $ 8,780 Paid-in capital 18,839 18,839 Retained earnings 74,203 $ 105 74,308 ---------- ----------- ---------- Total common stock equity 101,822 105 101,927 LONG-TERM DEBT 89,238 4,876 94,114 ---------- ----------- ---------- Total capitalization 191,060 4,981 196,041 ---------- ----------- ---------- CURRENT LIABILITIES Notes payable 14,500 14,500 Accounts payable 21,655 21,655 Accrued taxes 2,876 2,876 Accrued interest 2,123 2,123 Other 4,123 4,123 ---------- ---------- 45,277 45,277 ---------- ---------- OTHER LIABILITIES Deferred income taxes 23,226 23,226 Unamortized investment tax credits 5,364 5,364 Accrued pension and other postretirement benefit costs 10,356 10,356 Income taxes refundable through rates 4,282 4,282 Other 7,563 7,563 ---------- ---------- 50,791 50,791 ---------- ----------- ---------- $ 287,128 $ 4,981 $ 292,109 ========== =========== ========== The Pro Forma Adjustments are shown on Exhibit FS-9 of this filing.
EX-99.FS.7 12 UNION LIGHT UNAUDITED PRO FORMA STATEMENT OF INCOME
Exhibit FS-7 Financial Statements Page 1 of 1 THE UNION LIGHT, HEAT AND POWER COMPANY PRO FORMA STATEMENT OF INCOME TWELVE MONTHS ENDED DECEMBER 31, 1994 Pro Forma Actual Adjustments Pro Forma ---------- ----------- --------- (in thousands, except per share amounts) OPERATING REVENUES Electric $ 177,564 $ 177,564 Gas 71,971 71,971 ---------- --------- 249,535 249,535 ---------- --------- OPERATING EXPENSES Electricity purchased from parent company for resale 134,887 134,887 Gas purchased 40,508 40,508 Other operation 32,289 32,289 Maintenance 5,473 5,473 Depreciation 10,644 10,644 Income taxes 5,342 $ 57 5,399 Taxes other than income taxes 4,002 4,002 ---------- ----------- --------- 233,145 57 233,202 ---------- ----------- --------- OPERATING INCOME 16,390 (57) 16,333 ---------- ----------- --------- OTHER INCOME AND EXPENSES - NET Allowance for equity funds used during construction 78 78 Other - net 292 292 ---------- --------- 370 370 ---------- ----------- --------- INCOME BEFORE INTEREST 16,760 (57) 16,703 ---------- ----------- --------- INTEREST Interest on long-term debt 8,161 (162) 7,999 Other interest 395 395 Allowance for borrowed funds used during construction (183) (183) ---------- ----------- --------- 8,373 (162) 8,211 ---------- ----------- --------- NET INCOME $ 8,387 $ 105 $ 8,492 ========== =========== ========= The Pro Forma Adjustments are shown on Exhibit FS-9 of this filing.
EX-99.FS.8 13 UNION LIGHT UNAUDITED PRO FORMA STATEMENT OF RETAINED EARNINGS
Exhibit FS-8 Financial Statements Page 1 of 1 THE UNION LIGHT, HEAT AND POWER COMPANY PRO FORMA STATEMENT OF CHANGES IN RETAINED EARNINGS TWELVE MONTHS ENDED DECEMBER 31, 1994 Pro Forma Actual Adjustments Pro Forma ---------- ----------- --------- (dollars in thousands) Balance, December 31, 1993 $ 69,327 $ 69,327 Net income 8,387 $ 105 8,492 Dividends on common stock (3,511) (3,511) ---------- ---------- ---------- Balance, December 31, 1994 $ 74,203 $ 105 $ 74,308 ========== ========== ========== The Pro Forma Adjustments are shown on Exhibit FS-9 of this filing.
EX-99.FS.9 14 UNION LIGHT UNAUDITED PRO FORMA JOURNAL ENTRIES Exhibit FS-9 Financial Statements Page 1 of 6 THE UNION LIGHT, HEAT AND POWER COMPANY PRO FORMA JOURNAL ENTRIES TO GIVE EFFECT TO THE ISSUANCE OF UP TO $55 MILLION OF DEBT SECURITIES AND RELATED REDEMPTION OF OUTSTANDING DEBT SECURITIES Debit Credit ------------- ------------- 1) Cash $ 55,000,000 Long-term debt - Union Debentures $ 55,000,000 To record the issuance and sale of $55,000,000 principal amount of unsecured debt by The Union Light, Heat and Power Company (Union Light). 2) Discount on long-term debt $ 687,500 Cash $ 687,500 To record the maximum issuance expenses for Union Light on unsecured debt at 1.25% of the principal amount of Union Debentures. 3) Long-term debt $ 50,000,000 Cash $ 50,000,000 To record Union Light's redemption of $15 million principal amount of First Mortgage Bonds, 10-1/4% Series Due June 1, 2020, $15 million principal amount of First Mortgage Bonds, 10-1/4% Series Due November 15, 2020, and $20 million principal amount of First Mortgage Bonds, 9.70% Series Due July 1, 2019. Exhibit FS-9 Financial Statements Page 2 of 6 THE UNION LIGHT, HEAT AND POWER COMPANY PRO FORMA JOURNAL ENTRIES TO GIVE EFFECT TO THE ISSUANCE OF UP TO $55 MILLION OF DEBT SECURITIES AND RELATED REDEMPTION OF OUTSTANDING DEBT SECURITIES Debit Credit ------------- ------------- 4) Unamortized loss on reacquired debt $ 4,377,934 Discount on long-term debt $ 563,692 Unamortized debt expense $ 237,242 Cash $ 3,577,000 To record Union Light's loss on redemption of $15 million principal amount of First Mortgage Bonds, 10-1/4% Series Due June 1, 2020 at 107.34%, $15 million principal amount of First Mortgage Bonds, 10-1/4% Series Due November 15, 2020 at 107.20%, and $20 million principal amount of First Mortgage Bonds, 9.70% Series Due 2019 at 106.98%. Calculations are as follows: 10-1/4% 10-1/4% 9.70% Series Due Series Due Series Due June 1, 2020 Nov. 15, 2020 2019 Total ------------- -------------- ------------- ------------- Princ. amount $ 15,000,000 $ 15,000,000 $ 20,000,000 $ 50,000,000 Discount on long-term debt 167,400 191,680 204,612 563,692 Unamort. debt expense 72,300 80,265 84,677 237,242 ------------- ------------- ------------- ------------- Carrying amount $ 14,760,300 $ 14,728,055 $ 19,710,711 $ 49,199,066 ============= ============= ============= ============= Redemp. price % 107.34% 107.20% 106.98% Redemp. price $ 16,101,000 $ 16,080,000 $ 21,396,000 $ 53,577,000 Estimated loss on redemption $ 1,340,700 $ 1,351,945 $ 1,685,289 $ 4,377,934 Exhibit FS-9 Financial Statements Page 3 of 6 THE UNION LIGHT, HEAT AND POWER COMPANY PRO FORMA JOURNAL ENTRIES TO GIVE EFFECT TO THE ISSUANCE OF UP TO $55 MILLION OF DEBT SECURITIES AND RELATED REDEMPTION OF OUTSTANDING DEBT SECURITIES Debit Credit ------------- ------------- 5) Cash $ 340,000 Interest on long-term debt $ 340,000 To record Union Light's decrease in interest expense from issuing unsecured debt and retiring first mortgage bonds. Calculations are as follows: Assumed Interest Balance Interest Rate Expense ------------- ------------- ------------- Interest Expense Increase ------------------------- Union Debentures $ 55,000,000 8.50%$ 4,675,000 ------------- Total increase 4,675,000 ------------- Interest Expense Decrease ------------------------- First Mortgage Bonds, 10-1/4% Series Due: June 1, 2020 $ 15,000,000 10-1/4% 1,537,500 November 15, 2020 $ 15,000,000 10-1/4% 1,537,500 First Mortgage Bonds, 9.70% Series Due 2019 $ 20,000,000 9.70% 1,940,000 ------------- Total decrease 5,015,000 ------------- Net decrease $ 340,000 ============= Exhibit FS-9 Financial Statements Page 4 of 6 THE UNION LIGHT, HEAT AND POWER COMPANY PRO FORMA JOURNAL ENTRIES TO GIVE EFFECT TO THE ISSUANCE OF UP TO $55 MILLION OF DEBT SECURITIES AND RELATED REDEMPTION OF OUTSTANDING DEBT SECURITIES Debit Credit ------------- ------------- 6) Amortization of debt discount $ 45 Discount on long-term debt $ 45 To record Union Light's incremental increase in amortization of debt discount from issuing unsecured debt and retiring first mortgage bonds. Calculations are as follows: Maximum Issuance Issuance Balance Discount % Discount ------------- ------------- ------------- Union debentures $ 55,000,000 1.25%$ 687,500 ============= Annual amortization based on an assumed 30 year amortization period $ 22,917 ============= Original Issuance Life of Annual Discount Issue Amortization ------------- ------------- ------------- Issues Redeemed --------------- First Mortgage Bonds 10-1/4% Series Due: June 1, 2020 $ 201,000 30 Years $ 6,696 November 15, 2020 $ 230,250 30 Years 7,680 First Mortgage Bonds, 9.70% Series Due 2019 $ 255,000 30 Years 8,496 ------------- $ 22,872 ============= Net increase in annual amortization $ 45 ============= Exhibit FS-9 Financial Statements Page 5 of 6 THE UNION LIGHT, HEAT AND POWER COMPANY PRO FORMA JOURNAL ENTRIES TO GIVE EFFECT TO THE ISSUANCE OF UP TO $55 MILLION OF DEBT SECURITIES AND RELATED REDEMPTION OF OUTSTANDING DEBT SECURITIES Debit Credit ------------- ------------- 7) Amortization of loss on reacquired debt $ 177,926 Unamortized loss on reacquired debt $ 177,926 To record Union Light's amortization of loss on reacquired debt. Calculations are as follows: Loss on Assumed Reacquired Amortization Annual Debt Period Amortization ------------- ------------- ------------- First Mortgage Bonds, 10-1/4% Series Due: June 1, 2020 $ 1,340,700 25 Years $ 53,628 November 15, 2020 $ 1,351,945 25 Years 54,078 First Mortgage Bonds, 9.70% Series Due 2019 $ 1,685,289 24 Years 70,220 ------------- $ 177,926 ============= 8) Income tax expense $ 56,710 Cash $ 56,710 To record the impact on income tax expense from Union Light issuing unsecured debt and redeeming first mortgage bonds. Calculations are as follows: Increase (Decrease) to Income ------------- Interest expense $ 340,000 Amortization of discount on long-term debt (45) Amortization of loss on reacquired debt (177,926) ------------- Net impact on income $ 162,029 ============= Impact on income taxes at assumed rate of 35% $ 56,710 ============= Exhibit FS-9 Financial Statements Page 6 of 6 THE UNION LIGHT, HEAT AND POWER COMPANY PRO FORMA JOURNAL ENTRIES TO GIVE EFFECT TO THE ISSUANCE OF UP TO $55 MILLION OF DEBT SECURITIES AND RELATED REDEMPTION OF OUTSTANDING DEBT SECURITIES NOTE (a) Loss on redemptions will be capitalized and amortized over the shorter of (1) the remaining life of the issue redeemed, or (2) the life of the new issue. (b) A 30 year term for new issues has been assumed for pro-forma statement purposes only. Actual term of new issues may be up to 40 years. (c) Excess proceeds, if any, after redeeming securities will be used for general and corporate purposes. (d) For purposes of pro-forma financial statements, out-of-pocket issuance costs have been ignored. EX-99.FS.10 15 UNION LIGHT STATEMENT OF BONDABLE PROPERTY ADDITIONS Exhibit FS-10 Financial Statements Page 1 of 1 THE UNION LIGHT, HEAT AND POWER COMPANY STATEMENT OF BONDABLE PROPERTY ADDITIONS Balance of unbonded bondable property through December 31, 1993 available for issuance of bonds at March 30, 1995 $ 158,698,023 =============== NOTE: Union Light can issue first mortgage bonds in principal amounts equal to 60% of the cost or the then fair value to Union Light (whichever shall be less) of unbonded bondable property. In addition, Union Light is also permitted to issue first mortgage bonds on the basis of previously retired bonds under the terms of its First Mortgage. Currently, Union Light is able to issue up to $9 million of first mortgage bonds on the basis of previously retired bonds in addition to the amount issuable against unbonded bondable property reported above. If the Securities are issued as unsecured obligations, unbonded bondable property available for issuance of bonds will not be impacted by the proposed transaction. EX-99.FS.11 16 CINERGY UNAUDITED PROFORMA CONSOLIDATED BALANCE SHEET
Exhibit FS-11 Financial Statements Page 1 of 2 CINERGY CORP. PRO FORMA CONSOLIDATED BALANCE SHEET AT DECEMBER 31, 1994 ASSETS Pro Forma Actual Adjustments Pro Forma ------------ ------------- ------------- (dollars in thousands) UTILITY PLANT - ORIGINAL COST In service Electric $ 8,292,625 $ 8,292,625 Gas 645,602 645,602 Common 185,718 185,718 ------------ ------------- 9,123,945 9,123,945 Accumulated depreciation 3,163,802 3,163,802 ------------ ------------- 5,960,143 5,960,143 Construction work in progress 238,750 238,750 ------------ ------------- Total utility plant 6,198,893 6,198,893 ------------ ------------- CURRENT ASSETS Cash and temporary cash investments 71,880 $ 26,409 98,289 Restricted deposits 11,288 11,288 Accounts receivable less accumulated provision of $9,716,000 for doubtful accounts 299,509 299,509 Materials, supplies and fuel, at average cost Fuel for use in electric production 156,028 156,028 Gas stored for current use 31,284 31,284 Other materials and supplies 92,880 92,880 Property taxes applicable to subsequent year 112,420 112,420 Prepayments and other 36,416 36,416 ------------ ------------- ------------- 811,705 26,409 838,114 ------------ ------------- ------------- OTHER ASSETS Regulatory Assets Post-in-service carrying costs and deferred operating expenses 185,280 185,280 Phase-in deferred return and depreciation 100,943 100,943 Deferred demand-side management costs 104,127 104,127 Amounts due from customers -- income taxes 408,514 408,514 Deferred merger costs 49,658 49,658 Unamortized costs of reacquiring debt 70,424 32,413 102,837 Other 86,017 86,017 Other 134,281 (682) 133,599 ------------ ------------- ------------- 1,139,244 31,731 1,170,975 ------------ ------------- ------------- $ 8,149,842 $ 58,140 $ 8,207,982 ============ ============= ============= The Pro Forma Adjustments are shown on Exhibit FS-14 of this filing.
Exhibit FS-11 Financial Statements Page 2 of 2 CINERGY CORP. PRO FORMA CONSOLIDATED BALANCE SHEET AT DECEMBER 31, 1994 CAPITALIZATION AND LIABILITIES Pro Forma Actual Adjustments Pro Forma ------------ ------------- ------------ (dollars in thousands) COMMON STOCK EQUITY Common stock - $.01 par value; Authorized shares - 600,000,000 Outstanding shares - 155,198,038 $ 1,552 $ 1,552 Paid-in capital 1,535,658 $ 1,261 1,536,919 Retained earnings 877,061 (3,042) 874,019 ------------ ------------- ------------ Total common stock equity 2,414,271 (1,781) 2,412,490 CUMULATIVE PREFERRED STOCK OF SUBSIDIARIES Not subject to mandatory redemption 267,929 (40,000) 227,929 Subject to mandatory redemption 210,000 (50,000) 160,000 LONG-TERM DEBT 2,715,269 149,921 2,865,190 ------------ ------------- ------------ Total capitalization 5,607,469 58,140 5,665,609 ------------ ------------- ------------ CURRENT LIABILITIES Long-term debt due within one year 60,400 60,400 Notes payable 228,900 228,900 Accounts payable 266,467 266,467 Refund due to customers 15,482 15,482 Litigation settlement 80,000 80,000 Accrued taxes 258,041 258,041 Accrued interest 58,504 58,504 Other 36,610 36,610 ------------ ------------ 1,004,404 1,004,404 ------------ ------------ OTHER LIABILITIES Deferred income taxes 1,071,104 1,071,104 Unamortized investment tax credits 195,878 195,878 Accrued pension and other postretirement benefit costs 133,578 133,578 Other 137,409 137,409 ------------ ------------ 1,537,969 1,537,969 ------------ ------------- ------------ $ 8,149,842 $ 58,140 $ 8,207,982 ============ ============= ============ The Pro Forma Adjustments are shown on Exhibit FS-14 of this filing.
EX-99.FS.12 17 CINERGY UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF INCOME
Exhibit FS-12 Financial Statements Page 1 of 1 CINERGY CORP. PRO FORMA CONSOLIDATED STATEMENT OF INCOME TWELVE MONTHS ENDED DECEMBER 31, 1994 Pro Forma Actual Adjustments Pro Forma ------------ ------------ ------------- (in thousands, except per share amounts) OPERATING REVENUES Electric $ 2,481,779 $ 2,481,779 Gas 442,398 442,398 ------------ ------------- 2,924,177 2,924,177 ------------ ------------- OPERATING EXPENSES Fuel used in electric production 725,985 725,985 Gas purchased 248,293 248,293 Purchased and exchanged power 62,332 62,332 Other operation 563,650 563,650 Maintenance 200,959 200,959 Depreciation 294,395 294,395 Post-in-service deferred operating expenses -- net (5,998) (5,998) Phase-in deferred depreciation (2,161) (2,161) Income taxes 152,181 $ (3,167) 149,014 Taxes other than income taxes 244,051 244,051 ------------ ------------ ------------- 2,483,687 (3,167) 2,480,520 ------------ ------------ ------------- OPERATING INCOME 440,490 3,167 443,657 ------------ ------------ ------------- OTHER INCOME AND EXPENSES - NET Allowance for equity funds used during construction 6,201 6,201 Post-in-service carrying costs 9,780 9,780 Phase-in deferred return 15,351 15,351 Income taxes 10,609 10,609 Other - net (28,444) (28,444) ------------ ------------- 13,497 13,497 ------------ ------------ ------------- INCOME BEFORE INTEREST AND OTHER CHARGES 453,987 3,167 457,154 ------------ ------------ ------------- INTEREST AND OTHER CHARGES Interest on long-term debt 219,248 9,049 228,297 Other interest 20,370 20,370 Allowance for borrowed funds used during construction (12,332) (12,332) Preferred dividend requirements of subsidiaries 35,559 (7,551) 28,008 ------------ ------------ ------------- 262,845 1,498 264,343 ------------ ------------ ------------- NET INCOME $ 191,142 $ 1,669 $ 192,811 ============ ============ ============= AVERAGE COMMON SHARES OUTSTANDING 147,426 147,426 EARNINGS PER COMMON SHARE $ 1.30 $ 0.01 $ 1.31 DIVIDENDS DECLARED PER COMMON SHARE $ 1.50 $ 1.50 The Pro Forma Adjustments are shown on Exhibit FS-14 of this filing.
EX-99.FS.13 18 CINERGY UNAUDITED PRO FORMA STATEMENT OF RETAINED EARNINGS
Exhibit FS-13 Financial Statements Page 1 of 1 CINERGY CORP. PRO FORMA CONSOLIDATED STATEMENT OF CHANGES IN RETAINED EARNINGS TWELVE MONTHS ENDED DECEMBER 31, 1994 Pro Forma Actual Adjustments Pro Forma ------------ ----------- ------------ (dollars in thousands) Balance, December 31, 1993 $ 907,802 $ 907,802 Net income 191,142 $ 1,669 192,811 Dividends on common stock (221,362) (221,362) Other (521) (4,711) (5,232) ------------ ----------- ------------ Balance, December 31, 1994 $ 877,061 $ (3,042) $ 874,019 ============ =========== ============ The Pro Forma Adjustments are shown on Exhibit FS-14 of this filing.
EX-99.FS.14 19 CINERGY PRO FORMA CONSOLIDATED JOURNAL ENTRIES Exhibit FS-14 Financial Statements Page 1 of 12 CINERGY CORP. PRO FORMA CONSOLIDATED JOURNAL ENTRIES TO GIVE EFFECT TO THE ISSUANCE OF UP TO $555 MILLION OF DEBT SECURITIES AND RELATED REDEMPTION OF OUTSTANDING DEBT AND PREFERRED SECURITIES Debit Credit ------------- ------------- 1) Cash $ 500,000,000 Long-term debt - Senior Debentures $ 400,000,000 Long-term debt - Junior Securities $ 100,000,000 To record the issuance and sale of $500,000,000 principal amount of unsecured debt for The Cincinnati Gas & Electric Company (CG&E). 2) Cash $ 55,000,000 Long-term debt - Union Debentures $ 55,000,000 To record the issuance and sale of $55,000,000 principal amount of unsecured debt by The Union Light, Heat and Power Company (Union Light). 3) Discount on long-term debt $ 8,500,000 Cash $ 8,500,000 To record the maximum issuance expenses for CG&E on unsecured debt at 1.25% of the principal amount of Senior Debentures, and 3.50% of the principal amount for Junior Securities. 4) Discount on long-term debt $ 687,500 Cash $ 687,500 To record the maximum issuance expenses for Union Light on unsecured debt at 1.25% of the principal amount of Union Debentures. 5) Pref. stock - Not subject to mandatory redemp. $ 40,000,000 Pref. stock - Subject to mandatory redemp. $ 50,000,000 Cash $ 90,000,000 To record CG&E's retirement of Cumulative Preferred Stock, 7.44% and 9.15% Series. Exhibit FS-14 Financial Statements Page 2 of 12 CINERGY CORP. PRO FORMA CONSOLIDATED JOURNAL ENTRIES TO GIVE EFFECT TO THE ISSUANCE OF UP TO $555 MILLION OF DEBT SECURITIES AND RELATED REDEMPTION OF OUTSTANDING DEBT AND PREFERRED SECURITIES Debit Credit ------------- ------------- 6) Retained earnings $ 3,450,000 Cash $ 3,450,000 To record CG&E's charge to retained earnings for redemption premiums on retirement of Cumulative Preferred Stock, 7.44% and 9.15% Series. Calculations are as follows: Redemption Price Redemption Balance Per Share Premium ------------- ------------- ------------- Cumulative Preferred Stock: 7.44% Series $ 40,000,000 $ 101.00 $ 400,000 9.15% Series 50,000,000 $ 106.10 3,050,000 ------------- ------------- $ 90,000,000 $ 3,450,000 ============= ============= 7) Retained earnings $ 1,260,627 Paid-in capital $ 1,260,627 To record CG&E's write-off of issuance expense to retained earnings on retired Cumulative Preferred Stock, 7.44% and 9.15% Series. Calculations are as follows: Issuance Expense ------------- Cumulative Preferred Stock: 7.44% Series $ 531,553 9.15% Series 729,074 ------------- $ 1,260,627 ============= Exhibit FS-14 Financial Statements Page 3 of 12 CINERGY CORP. PRO FORMA CONSOLIDATED JOURNAL ENTRIES TO GIVE EFFECT TO THE ISSUANCE OF UP TO $555 MILLION OF DEBT SECURITIES AND RELATED REDEMPTION OF OUTSTANDING DEBT AND PREFERRED SECURITIES Debit Credit ------------- ------------- 8) Long-term debt $ 350,000,000 Cash $ 350,000,000 To record CG&E's redemption of $100 million principal amount of First Mortgage Bonds, 10-1/8% Series Due 2020, $150 million principal amount of First Mortgage Bonds, 10.20% Series Due 2020, and $100 million principal amount of First Mortgage Bonds, 9.70% Series Due 2019, by CG&E. 9) Long-term debt $ 50,000,000 Cash $ 50,000,000 To record Union Light's redemption of $15 million principal amount of First Mortgage Bonds, 10-1/4% Series Due June 1, 2020, $15 million principal amount of First Mortgage Bonds, 10-1/4% Series Due November 15, 2020, and $20 million principal amount of First Mortgage Bonds, 9.70% Series Due July 1, 2019. Exhibit FS-14 Financial Statements Page 4 of 12 CINERGY CORP. PRO FORMA CONSOLIDATED JOURNAL ENTRIES TO GIVE EFFECT TO THE ISSUANCE OF UP TO $555 MILLION OF DEBT SECURITIES AND RELATED REDEMPTION OF OUTSTANDING DEBT AND PREFERRED SECURITIES Debit Credit ------------- ------------- 10)Unamortized loss on reacquired debt $ 29,402,907 Discount on long-term debt $ 3,398,247 Unamortized debt expense $ 444,660 Cash $ 25,560,000 To record CG&E's loss on redemption of $100 million principal amount of First Mortgage Bonds, 10-1/8% Series Due 2020 at 107.27%, $150 million principal amount of First Mortgage Bonds, 10.20% Series Due 2020 at 107.44%, and $100 million principal amount of First Mortgage Bonds, 9.70% Series Due 2019 at 107.13%. Calculations are as follows: 10-1/8% 10.20% 9.70% Series Due Series Due Series Due 2020 2020 2019 Total ------------- ------------- ------------- ------------- Princ. amount $ 100,000,000 $ 150,000,000 $ 100,000,000 $ 350,000,000 Discount on long-term debt 1,089,900 1,443,900 864,447 3,398,247 Unamort. debt expense 149,100 156,600 138,960 444,660 ------------- ------------- ------------- ------------- Carrying amount $ 98,761,000 $ 148,399,500 $ 98,996,593 $ 346,157,093 ============= ============= ============= ============= Redemp. price % 107.27% 107.44% 107.13% Redemp. price $ 107,270,000 $ 161,160,000 $ 107,130,000 $ 375,560,000 Estimated loss on redemption $ 8,509,000 $ 12,760,500 $ 8,133,407 $ 29,402,907 Exhibit FS-14 Financial Statements Page 5 of 12 CINERGY CORP. PRO FORMA CONSOLIDATED JOURNAL ENTRIES TO GIVE EFFECT TO THE ISSUANCE OF UP TO $555 MILLION OF DEBT SECURITIES AND RELATED REDEMPTION OF OUTSTANDING DEBT AND PREFERRED SECURITIES Debit Credit ------------- ------------- 11)Unamortized loss on reacquired debt $ 4,377,934 Discount on long-term debt $ 563,692 Unamortized debt expense $ 237,242 Cash $ 3,577,000 To record Union Light's loss on redemption of $15 million principal amount of First Mortgage Bonds, 10-1/4% Series Due June 1, 2020 at 107.34%, $15 million principal amount of First Mortgage Bonds, 10-1/4% Series Due November 15, 2020 at 107.20%, and $20 million principal amount of First Mortgage Bonds, 9.70% Series Due 2019 at 106.98%. Calculations are as follows: 10-1/4% 10-1/4% 9.70% Series Due Series Due Series Due June 1, 2020 Nov. 15, 2020 2019 Total ------------- -------------- ------------- ------------- Princ. amount $ 15,000,000 $ 15,000,000 $ 20,000,000 $ 50,000,000 Discount on long-term debt 167,400 191,680 204,612 563,692 Unamort. debt expense 72,300 80,265 84,677 237,242 ------------- ------------- ------------- ------------- Carrying amount $ 14,760,300 $ 14,728,055 $ 19,710,711 $ 49,199,066 ============= ============= ============= ============= Redemp. price % 107.34% 107.20% 106.98% Redemp. price $ 16,101,000 $ 16,080,000 $ 21,396,000 $ 53,577,000 Estimated loss on redemption $ 1,340,700 $ 1,351,945 $ 1,685,289 $ 4,377,934 Exhibit FS-14 Financial Statements Page 6 of 12 CINERGY CORP. PRO FORMA CONSOLIDATED JOURNAL ENTRIES TO GIVE EFFECT TO THE ISSUANCE OF UP TO $555 MILLION OF DEBT SECURITIES AND RELATED REDEMPTION OF OUTSTANDING DEBT AND PREFERRED SECURITIES Debit Credit ------------- ------------- 12)Interest on long-term debt $ 7,875,000 Cash $ 7,875,000 To record CG&E's increase in interest expense from issuing unsecured debt and retiring first mortgage bonds. Calculations are as follows: Assumed Interest Balance Interest Rate Expense ------------- ------------- ------------- Interest Expense Increase ------------------------- Senior debentures $ 400,000,000 8.50%$ 34,000,000 Junior securities $ 100,000,000 9.00% 9,000,000 ------------- Total increase 43,000,000 ------------- Interest Expense Decrease ------------------------- First Mortgage Bonds: 10-1/8% Series Due 2020 $ 100,000,000 10-1/8% 10,125,000 10.20% Series Due 2020 $ 150,000,000 10.20% 15,300,000 9.70% Series Due 2019 $ 100,000,000 9.70% 9,700,000 ------------- Total decrease 35,125,000 ------------- Net increase $ 7,875,000 ============= Exhibit FS-14 Financial Statements Page 7 of 12 CINERGY CORP. PRO FORMA CONSOLIDATED JOURNAL ENTRIES TO GIVE EFFECT TO THE ISSUANCE OF UP TO $555 MILLION OF DEBT SECURITIES AND RELATED REDEMPTION OF OUTSTANDING DEBT AND PREFERRED SECURITIES Debit Credit ------------- ------------- 13)Cash $ 340,000 Interest on long-term debt $ 340,000 To record Union Light's decrease in interest expense from issuing unsecured debt and retiring first mortgage bonds. Calculations are as follows: Assumed Interest Balance Interest Rate Expense ------------- ------------- ------------- Interest Expense Increase ------------------------- Union debentures $ 55,000,000 8.50%$ 4,675,000 ------------- Total increase 4,675,000 ------------- Interest Expense Decrease ------------------------- First Mortgage Bonds, 10-1/4% Series Due: June 1, 2020 $ 15,000,000 10-1/4% 1,537,500 November 15, 2020 $ 15,000,000 10-1/4% 1,537,500 First Mortgage Bonds, 9.70% Series Due 2019 $ 20,000,000 9.70% 1,940,000 ------------- Total decrease 5,015,000 ------------- Net decrease $ 340,000 ============= Exhibit FS-14 Financial Statements Page 8 of 12 CINERGY CORP. PRO FORMA CONSOLIDATED JOURNAL ENTRIES TO GIVE EFFECT TO THE ISSUANCE OF UP TO $555 MILLION OF DEBT SECURITIES AND RELATED REDEMPTION OF OUTSTANDING DEBT AND PREFERRED SECURITIES Debit Credit ------------- ------------- 14)Amortization of debt discount $ 146,149 Discount on long-term debt $ 146,149 To record CG&E's incremental increase in amortization of debt discount from issuing unsecured debt and retiring first mortgage bonds. Calculations are as follows: Maximum Issuance Issuance Balance Discount % Discount ------------- ------------- ------------- New Issues ---------- Senior debentures $ 400,000,000 1.25%$ 5,000,000 Junior securities $ 100,000,000 3.50% 3,500,000 ------------- $ 8,500,000 ============= Annual amortization based on an assumed 30 year amortization period $ 283,333 ============= Original Issuance Life of Annual Discount Issue Amortization ------------- ------------- ------------- Issues Redeemed --------------- First Mortgage Bonds: 10-1/8% Series Due 2020 $ 1,308,000 30 Years $ 43,596 10.20% Series Due 2020 $ 1,732,500 30 Years 57,756 9.70% Series Due 2019 $ 1,075,000 30 Years 35,832 ------------- $ 137,184 ============= Net increase in annual amortization $ 146,149 ============= Exhibit FS-14 Financial Statements Page 9 of 12 CINERGY CORP. PRO FORMA CONSOLIDATED JOURNAL ENTRIES TO GIVE EFFECT TO THE ISSUANCE OF UP TO $555 MILLION OF DEBT SECURITIES AND RELATED REDEMPTION OF OUTSTANDING DEBT AND PREFERRED SECURITIES Debit Credit ------------- ------------- 15)Amortization of debt discount $ 45 Discount on long-term debt $ 45 To record Union Light's incremental increase in amortization of debt discount from issuing unsecured debt and retiring first mortgage bonds. Calculations are as follows: Maximum Issuance Issuance Balance Discount % Discount ------------- ------------- ------------- Union debentures $ 55,000,000 1.25%$ 687,500 ============= Annual amortization based on an assumed 30 year amortization period $ 22,917 ============= Original Issuance Life of Annual Discount Issue Amortization ------------- ------------- ------------- Issues Redeemed --------------- First Mortgage Bonds 10-1/4% Series Due: June 1, 2020 $ 201,000 30 Years $ 6,696 November 15, 2020 $ 230,250 30 Years 7,680 First Mortgage Bonds, 9.70% Series Due 2019 $ 255,000 30 Years 8,496 ------------- $ 22,872 ============= Net increase in annual amortization $ 45 ============= Exhibit FS-14 Financial Statements Page 10 of 12 CINERGY CORP. PRO FORMA CONSOLIDATED JOURNAL ENTRIES TO GIVE EFFECT TO THE ISSUANCE OF UP TO $555 MILLION OF DEBT SECURITIES AND RELATED REDEMPTION OF OUTSTANDING DEBT AND PREFERRED SECURITIES Debit Credit ------------- ------------- 16)Amortization of loss on reacquired debt $ 1,189,672 Unamortized loss on reacquired debt $ 1,189,672 To record CG&E's amortization of loss on reacquired debt. Calculations are as follows: Loss on Assumed Reacquired Amortization Annual Debt Period Amortization ------------- ------------- ------------- First Mortgage Bonds: 10-1/8% Series Due 2020 $ 8,509,000 25 Years $ 340,360 10.20% Series Due 2020 $ 12,760,500 25 Years 510,420 9.70% Series Due 2019 $ 8,133,407 24 Years 338,892 ------------- $ 1,189,672 ============= 17)Amortization of loss on reacquired debt $ 177,926 Unamortized loss on reacquired debt $ 177,926 To record Union Light's amortization of loss on reacquired debt. Calculations are as follows: Loss on Assumed Reacquired Amortization Annual Debt Period Amortization ------------- ------------- ------------- First Mortgage Bonds, 10-1/4% Series Due: June 1, 2020 $ 1,340,700 25 Years $ 53,628 November 15, 2020 $ 1,351,945 25 Years 54,078 First Mortgage Bonds, 9.70% Series Due 2019 $ 1,685,289 24 Years 70,220 ------------- $ 177,926 ============= Exhibit FS-14 Financial Statements Page 11 of 12 CINERGY CORP. PRO FORMA CONSOLIDATED JOURNAL ENTRIES TO GIVE EFFECT TO THE ISSUANCE OF UP TO $555 MILLION OF DEBT SECURITIES AND RELATED REDEMPTION OF OUTSTANDING DEBT AND PREFERRED SECURITIES Debit Credit ------------- ------------- 18)Cash $ 7,551,000 Preferred dividends $ 7,551,000 To record the reduction in preferred dividends from CG&E's redemption of preferred stock. Calculations are as follows: Dividend Redemption Balance Rate Premium ------------- ------------- ------------- Cumulative Preferred Stock: 7.44% Series $ 40,000,000 7.44%$ 2,976,000 9.15% Series 50,000,000 9.15% 4,575,000 ------------- ------------- $ 90,000,000 $ 7,551,000 ============= ============= 19)Cash $ 3,223,787 Income tax expense $ 3,223,787 To record the impact on income tax expense from CG&E issuing unsecured debt and redeeming first mortgage bonds and preferred stock. Calculations are as follows: Increase (Decrease) to Income ------------- Interest expense $ (7,875,000) Amortization of discount on long-term debt (146,149) Amortization of loss on reacquired debt (1,189,672) ------------- Net impact on income $ (9,210,821) ============= Impact on income taxes at assumed rate of 35% $ (3,223,787) ============= Exhibit FS-14 Financial Statements Page 12 of 12 CINERGY CORP. PRO FORMA CONSOLIDATED JOURNAL ENTRIES TO GIVE EFFECT TO THE ISSUANCE OF UP TO $555 MILLION OF DEBT SECURITIES AND RELATED REDEMPTION OF OUTSTANDING DEBT AND PREFERRED SECURITIES Debit Credit ------------- ------------- 20)Income tax expense $ 56,710 Cash $ 56,710 To record the impact on income tax expense from Union Light issuing unsecured debt and redeeming first mortgage bonds. Calculations are as follows: Increase (Decrease) to Income ------------- Interest expense $ 340,000 Amortization of discount on long-term debt (45) Amortization of loss on reacquired debt (177,926) ------------- Net impact on income $ 162,029 ============= Impact on income taxes at assumed rate of 35% $ 56,710 ============= NOTE (a) Loss on redemptions will be capitalized and amortized over the shorter of (1) the remaining life of the issue redeemed, or (2) the life of the new issue. (b) A 30 year term for new issues has been assumed for pro-forma statement purposes only. Actual term of new issues may be up to 40 years. (c) Excess proceeds, if any, after redeeming securities will be used for general and corporate purposes. (d) For purposes of pro-forma financial statements, out-of-pocket issuance costs have been ignored. EX-99.FS.15 20 FINANCIAL DATA SCHEDULE [ARTICLE] OPUR1 [LEGEND] THIS SCHEDULE IS EXHIBIT FS-15 AND CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE CONSOLIDATED BALANCE SHEETS, CONSOLIDATED STATEMENTS OF INCOME AND CONSOLIDATED STATEMENTS OF CASH FLOWS OF THE CINCINNATI GAS & ELECTRIC COMPANY AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. [MULTIPLIER] 1,000 [PERIOD-TYPE] YEAR YEAR [FISCAL-YEAR-END] DEC-31-1994 DEC-31-1994 [PERIOD-START] JAN-01-1994 JAN-01-1994 [PERIOD-END] DEC-31-1994 DEC-31-1994 [BOOK-VALUE] PER-BOOK PRO-FORMA [TOTAL-NET-UTILITY-PLANT] 3,795,644 3,795,644 [OTHER-PROPERTY-AND-INVEST] 0 0 [TOTAL-CURRENT-ASSETS] 596,696 623,105 [TOTAL-DEFERRED-CHARGES] 748,889 781,302 [OTHER-ASSETS] 40,436 39,754 [TOTAL-ASSETS] 5,181,665 5,239,805 [COMMON] 762,136 762,136 [CAPITAL-SURPLUS-PAID-IN] 337,874 339,135 [RETAINED-EARNINGS] 432,962 429,920 [TOTAL-COMMON-STOCKHOLDERS-EQ] 1,532,972 1,531,191 [PREFERRED-MANDATORY] 210,000 160,000 [PREFERRED] 80,000 40,000 [LONG-TERM-DEBT-NET] 1,837,757 1,987,678 [SHORT-TERM-NOTES] 14,500 14,500 [LONG-TERM-NOTES-PAYABLE] 0 0 [COMMERCIAL-PAPER-OBLIGATIONS] 0 0 [LONG-TERM-DEBT-CURRENT-PORT] 0 0 [PREFERRED-STOCK-CURRENT] 0 0 [CAPITAL-LEASE-OBLIGATIONS] 0 0 [LEASES-CURRENT] 0 0 [OTHER-ITEMS-CAPITAL-AND-LIAB] 1,506,436 1,506,436 [TOT-CAPITALIZATION-AND-LIAB] 5,181,665 5,239,805 [GROSS-OPERATING-REVENUE] 1,788,185 1,788,185 [INCOME-TAX-EXPENSE] 104,128 100,961 [OTHER-OPERATING-EXPENSES] 1,392,721 1,392,721 [TOTAL-OPERATING-EXPENSES] 1,496,849 1,493,682 [OPERATING-INCOME-LOSS] 291,336 294,503 [OTHER-INCOME-NET] 17,215 17,215 [INCOME-BEFORE-INTEREST-EXPEN] 308,551 311,718 [TOTAL-INTEREST-EXPENSE] 150,240 159,289 [NET-INCOME] 158,311 152,429 [PREFERRED-STOCK-DIVIDENDS] 22,377 14,826 [EARNINGS-AVAILABLE-FOR-COMM] 135,934 137,603 [COMMON-STOCK-DIVIDENDS] 158,970 158,970 [TOTAL-INTEREST-ON-BONDS] 150,386 159,435 [CASH-FLOW-OPERATIONS] 447,358 406,295 [EPS-PRIMARY] 0 0 [EPS-DILUTED] 0 0
EX-99.FS.16 21 FINANCIAL DATA SCHEDULE [ARTICLE] OPUR1 [LEGEND] THIS SCHEDULE IS EXHIBIT FS-16 AND CONTAINS SUMMARY FINANICAL INFORMATION EXTRACTED FROM THE BALANCE SHEETS, STATEMENTS OF INCOME AND STATEMENTS OF CASH FLOWS OF THE UNION LIGHT, HEAT AND POWER COMPANY AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. [MULTIPLIER] 1,000 [PERIOD-TYPE] YEAR YEAR [FISCAL-YEAR-END] DEC-31-1994 DEC-31-1994 [PERIOD-START] JAN-01-1994 JAN-01-1994 [PERIOD-END] DEC-31-1994 DEC-31-1994 [BOOK-VALUE] PER-BOOK PRO-FORMA [TOTAL-NET-UTILITY-PLANT] 236,848 236,848 [OTHER-PROPERTY-AND-INVEST] 0 0 [TOTAL-CURRENT-ASSETS] 45,378 46,397 [TOTAL-DEFERRED-CHARGES] 1,785 1,785 [OTHER-ASSETS] 3,117 7,079 [TOTAL-ASSETS] 287,128 292,109 [COMMON] 8,780 8,780 [CAPITAL-SURPLUS-PAID-IN] 18,839 18,839 [RETAINED-EARNINGS] 74,203 74,308 [TOTAL-COMMON-STOCKHOLDERS-EQ] 101,822 101,927 [PREFERRED-MANDATORY] 0 0 [PREFERRED] 0 0 [LONG-TERM-DEBT-NET] 89,238 94,114 [SHORT-TERM-NOTES] 14,500 14,500 [LONG-TERM-NOTES-PAYABLE] 0 0 [COMMERCIAL-PAPER-OBLIGATIONS] 0 0 [LONG-TERM-DEBT-CURRENT-PORT] 0 0 [PREFERRED-STOCK-CURRENT] 0 0 [CAPITAL-LEASE-OBLIGATIONS] 0 0 [LEASES-CURRENT] 0 0 [OTHER-ITEMS-CAPITAL-AND-LIAB] 81,568 81,568 [TOT-CAPITALIZATION-AND-LIAB] 287,128 292,109 [GROSS-OPERATING-REVENUE] 249,535 249,535 [INCOME-TAX-EXPENSE] 5,342 5,399 [OTHER-OPERATING-EXPENSES] 227,803 227,803 [TOTAL-OPERATING-EXPENSES] 233,145 233,202 [OPERATING-INCOME-LOSS] 16,390 16,333 [OTHER-INCOME-NET] 370 370 [INCOME-BEFORE-INTEREST-EXPEN] 16,760 16,703 [TOTAL-INTEREST-EXPENSE] 8,373 8,211 [NET-INCOME] 8,387 8,492 [PREFERRED-STOCK-DIVIDENDS] 0 0 [EARNINGS-AVAILABLE-FOR-COMM] 8,387 8,492 [COMMON-STOCK-DIVIDENDS] 3,511 3,511 [TOTAL-INTEREST-ON-BONDS] 8,161 7,999 [CASH-FLOW-OPERATIONS] 32,934 29,077 [EPS-PRIMARY] 0 0 [EPS-DILUTED] 0 0
EX-99.FS.17 22 FINANCIAL DATA SCHEDULE [ARTICLE] OPUR1 [ARTICLE] OPUR1 [LEGEND] THIS SCHEDULE IS EXHIBIT FS-17 AND CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE CONSOLIDATED BALANCE SHEETS, CONSOLIDATED STATEMENTS OF INCOME AND CONSOLIDATED STATEMENTS OF CASH FLOWS OF CINERGY CORP. AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. [MULTIPLIER] 1,000 [PERIOD-TYPE] YEAR YEAR [FISCAL-YEAR-END] DEC-31-1994 DEC-31-1994 [PERIOD-START] JAN-01-1994 JAN-01-1994 [PERIOD-END] DEC-31-1994 DEC-31-1994 [BOOK-VALUE] PER-BOOK PRO-FORMA [TOTAL-NET-UTILITY-PLANT] 6,198,893 6,198,893 [OTHER-PROPERTY-AND-INVEST] 0 0 [TOTAL-CURRENT-ASSETS] 811,705 838,114 [TOTAL-DEFERRED-CHARGES] 1,004,963 1,037,376 [OTHER-ASSETS] 134,281 133,599 [TOTAL-ASSETS] 8,149,842 8,207,982 [COMMON] 1,552 1,552 [CAPITAL-SURPLUS-PAID-IN] 1,535,658 1,536,919 [RETAINED-EARNINGS] 877,061 874,019 [TOTAL-COMMON-STOCKHOLDERS-EQ] 2,414,271 2,412,490 [PREFERRED-MANDATORY] 210,000 160,000 [PREFERRED] 267,929 227,929 [LONG-TERM-DEBT-NET] 2,715,269 2,865,190 [SHORT-TERM-NOTES] 228,900 228,900 [LONG-TERM-NOTES-PAYABLE] 0 0 [COMMERCIAL-PAPER-OBLIGATIONS] 0 0 [LONG-TERM-DEBT-CURRENT-PORT] 60,400 60,400 [PREFERRED-STOCK-CURRENT] 0 0 [CAPITAL-LEASE-OBLIGATIONS] 0 0 [LEASES-CURRENT] 0 0 [OTHER-ITEMS-CAPITAL-AND-LIAB] 2,253,073 2,253,073 [TOT-CAPITALIZATION-AND-LIAB] 8,149,842 8,207,982 [GROSS-OPERATING-REVENUE] 2,924,177 2,924,177 [INCOME-TAX-EXPENSE] 152,181 149,014 [OTHER-OPERATING-EXPENSES] 2,331,506 2,331,506 [TOTAL-OPERATING-EXPENSES] 2,483,687 2,480,520 [OPERATING-INCOME-LOSS] 440,490 443,657 [OTHER-INCOME-NET] 13,497 13,497 [INCOME-BEFORE-INTEREST-EXPEN] 453,987 457,154 [TOTAL-INTEREST-EXPENSE] 227,286 236,335 [NET-INCOME] 226,701 220,819 [PREFERRED-STOCK-DIVIDENDS] 35,559 28,008 [EARNINGS-AVAILABLE-FOR-COMM] 191,142 192,811 [COMMON-STOCK-DIVIDENDS] 221,362 221,362 [TOTAL-INTEREST-ON-BONDS] 219,248 228,297 [CASH-FLOW-OPERATIONS] 440,408 399,345 [EPS-PRIMARY] 1.30 1.31 [EPS-DILUTED] 1.30 1.31