0000899652-95-000078.txt : 19950824 0000899652-95-000078.hdr.sgml : 19950824 ACCESSION NUMBER: 0000899652-95-000078 CONFORMED SUBMISSION TYPE: U-1/A PUBLIC DOCUMENT COUNT: 9 FILED AS OF DATE: 19950823 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: CINERGY CORP CENTRAL INDEX KEY: 0000899652 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRIC & OTHER SERVICES COMBINED [4931] IRS NUMBER: 311385023 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: U-1/A SEC ACT: 1935 Act SEC FILE NUMBER: 070-08587 FILM NUMBER: 95566240 BUSINESS ADDRESS: STREET 1: 139 E FOURTH ST CITY: CINCINNATI STATE: OH ZIP: 45202 BUSINESS PHONE: 5133812000 MAIL ADDRESS: STREET 1: 139 E FOURTH STREET CITY: CINCINATI STATE: OH ZIP: 45202 U-1/A 1 FORM U-1A As filed with the Securities and Exchange Commission on August 23, 1995 File No. 70-8587 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 AMENDMENT NO. 3 TO FORM U-1 APPLICATION-DECLARATION UNDER THE PUBLIC UTILITY HOLDING COMPANY ACT OF 1935 _______________________________________________ CINergy Corp., CINergy Services, Inc., The Cincinnati Gas & Electric Co., The Union Light, Heat and Power Co., The West Harrison Gas and Electric Co., Lawrenceburg Gas Co., Miami Power Corp., Tri-State Improvement Co., and KO Transmission Co. 139 East Fourth Street Cincinnati, Ohio 45202 PSI Energy, Inc. 1000 East Main Street Plainfield, Indiana 46168 (Names of companies filing this statement and addresses of principal executive offices) _______________________________________________ CINergy Corp. (Name of top registered holding company parent) ________________________________________________ William L. Sheafer Treasurer 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 Application-Declaration to: Cheryl M. Foley Vice President, General Counsel and Corporate Secretary CINergy Corp. 139 East Fourth Street Cincinnati, Ohio 45202 M. Douglas Dunn William T. Baker, Jr. Milbank, Tweed, Hadley & McCloy Reid & Priest One Chase Manhattan Plaza 40 West 57th Street New York, New York 10005 New York, New York 10019 The Application-Declaration in this file, as previously amended and restated, is hereby further amended and, as so amended, is hereby restated as set forth below and Exhibits 3, 8, 10, 10.1 and 13, previously filed, are hereby withdrawn. Item 1. Description of Proposed Transactions. In this Application-Declaration, CINergy Corp. ("CINergy"), a Delaware corporation and a registered holding company under the Public Utility Holding Company Act of 1935, as amended (the "Act"), and its subsidiary companies The Cincinnati Gas & Electric Co. ("CG&E"), PSI Energy, Inc. ("PSI Energy"), The Union Light, Heat and Power Co. ("ULH&P"), The West Harrison Gas and Electric Co. ("West Harrison"), Lawrenceburg Gas Co. ("Lawrenceburg"), Miami Power Corp. ("Miami"), CINergy Services, Inc. ("CINergy Services"), Tri-State Improvement Co. ("Tri-State"), and KO Transmission Co. ("KO") (collectively with CINergy, the "Applicants") seek the following authorizations and order: (a) authorization (i) for PSI Energy, ULH&P, Lawrenceburg, West Harrison and Miami to issue notes in connection with short-term borrowings with maturities of 12 months or less from banks and bank trust departments as set forth in Item 1.A.3 herein and through the Utility Money Pool as set forth in Item 1.A.5 herein; (ii) for PSI Energy, ULH&P, Lawrenceburg, West Harrison and Miami to lend and extend credit to (and acquire promissory notes from) one another, and for CINergy, CINergy Services, CG&E, Tri-State and KO to lend and extend credit to (and acquire promissory notes from) PSI Energy, ULH&P, Lawrenceburg, West Harrison and Miami, in connection with borrowings by PSI Energy, ULH&P, Lawrenceburg, West Harrison and Miami through the Utility Money Pool; (iii) for CINergy to issue guarantees and to provide letters of credit as set forth in Item 1.A.3.b herein; and (iv) for PSI Energy to issue commercial paper as set forth in Item 1.A.4 herein; and (b) an order of the Commission declaring that U.S. Energy Partners ("Energy Partners"), a partnership in which CINergy holds an interest, is not a "subsidiary company" of CINergy within the meaning of Section 2(a)(8) of the Act. It is proposed that the authority requested in clauses (a)(i) through (a)(iv) be effective in each case through the earlier of May 31, 1997 or the effective date of any rules adopted by the Commission exempting any such transactions from the approval requirements of the Act. Description of the Parties CINergy is a Delaware corporation and a holding company for PSI Energy, CG&E, and a number of other companies. PSI Energy is engaged in the production, transmission, distribution and sale of electric energy in north central, central, and southern Indiana. It serves a population of approximately 1.9 million in 69 of the 92 counties in Indiana, including the cities of Terre Haute, Kokomo, Columbus, Lafayette, Bloomington and New Albany. CG&E and its subsidiaries ULH&P, Lawrenceburg and West Harrison are primarily engaged in providing electric and/or gas service in the southwestern portion of Ohio and adjacent areas in Kentucky and Indiana. The area served with electricity, gas, or both covers approximately 3,000 square miles, has an estimated population of approximately 1.8 million, and includes the cities of Cincinnati and Middletown in Ohio, Covington and Newport in Kentucky, and Lawrenceburg in Indiana. Miami is an Indiana corporation and a subsidiary of CG&E. Miami owns a 138 kV transmission line running from the Miami Fort Power Station to a point near Madison, Indiana. Additional information about the Applicants and their businesses is set forth in the Form U-1 Application-Declaration, as amended, of CINergy in File No. 70-8427, and the exhibits thereto (the "CINergy Merger U-1"). A. Notes, guarantees and commercial paper 1. Borrowing authority Under the authority requested herein, the maximum principal amount of such short-term notes and/or commercial paper outstanding at any one time for PSI Energy, ULH&P, Lawrenceburg, West Harrison and Miami, when added to notes and/or commercial paper issued pursuant to the exemption set forth in Rule 52, will not exceed the following amounts: Company Aggregate amount PSI Energy $400,000,000 ULH&P 35,000,000 West Harrison 200,000 Lawrenceburg 3,000,000 Miami 100,000 2. Use of Proceeds Proceeds of any such short-term borrowings by PSI Energy, ULH&P, Lawrenceburg, West Harrison and Miami and sales of commercial paper by PSI Energy may be used by each such company (i) for the interim financing of its construction and capital expenditure programs; (ii) for its working capital needs; (iii) for the repayment, redemption or refinancing of its debt and preferred stock; (iv) to meet unexpected contingencies, payment and timing differences, and cash requirements, to cover inter-company balances, and for other lawful general corporate purposes; and (v) to loan to participants in the Utility Money Pool described in Item 1.A.5 below. The Applicants' estimated construction and capital expenditures for the years 1995-1996 are as follows: ($Millions) 1995 1996 Total PSI Energy 164 171 335 CG&E 127 175 302 ULH&P 15 19 34 Total 306 365 671 These estimates are subject to change due to numerous factors, including the rate of load growth, escalation of construction costs, changes in environmental and other regulation, delays from regulatory hearings and the adequacy of rate relief. 3. Notes in connection with bank borrowings a. Existing bank facilities PSI Energy has five formal bank facilities which permit borrowings with maturities of 12 months or less. Commitments under these five credit lines aggregate $102 million, of which $72.5 million in borrowings were outstanding at December 31, 1994. The agreements embodying these five lines of credit are filed as Exhibits 1.20, 1.22, 1.24, 1.26, and 1.30, and are subject in each case to annual one-year extensions at the request of PSI Energy and with the consent of the respective banks. The five credit lines are unsecured and provide for maturities of up to one year and one day for any borrowings by PSI Energy thereunder, with interest rate options at or below prime rate./1/ ULH&P has formal bank lines of credit with four banks with commitments aggregating $30 million (Exhibits 1.13-1.16 hereto), under which $14.5 million in borrowings were outstanding as of December 31, 1994. Lawrenceburg has a formal line of credit with one bank, with a commitment of $400,000 (Exhibit 1.17 hereto). Lawrenceburg had no borrowings outstanding under this facility at year-end 1994. As of December 31, 1994, West Harrison and Miami had no committed lines of credit. Certain of the Applicants also have informal arrangements for short-term borrowings with various banks on an "as offered" basis, also known as uncommitted lines of credit. Since interest rates on these borrowings, when and if such borrowings are available, generally are below the prevailing prime rate, it is intended that these informal arrangements will continue to be utilized. b. Notes in connection with additional bank borrowings; guarantees To provide flexibility to meet their cash needs, authorization is requested for PSI Energy, ULH&P and Lawrenceburg to issue notes in connection with borrowings from banks pursuant to the existing formal and informal lines of credit described above (and any increases therein that may be negotiated), and for PSI Energy, ULH&P, Lawrenceburg, West Harrison and Miami to issue notes in connection with borrowings from banks and bank trust departments pursuant to new credit facilities (formal or informal) that may be arranged from time to time. All such notes and related CINergy guarantees and letters of credit would be issued on or before May 31, 1997 and would be subject to the limitations on aggregate principal amount set forth in Item 1.A.1. Authorization is also requested for CINergy to issue guarantees and provide letters of credit in connection with the following borrowings: (1) borrowing by PSI Energy, ULH&P, Lawrenceburg, West Harrison and Miami pursuant to the existing formal and informal lines of credit described in Item 1.A.3.a (and any increases therein that may be negotiated) or the new credit facilities proposed in this Item 1.A.3.b; (ii) exempt external borrowings by PSI Energy, ULH&P, Lawrenceburg, West Harrison and Miami pursuant to Rule 52 or other applicable exemptions; and (iii) exempt external borrowings by CG&E, CINergy Services, Tri-State, KO, and the other subsidiary companies of CINergy named below pursuant to Rule 52 or other applicable exemptions. Such guarantees would be in an aggregate amount that, when added to any then-outstanding CINergy bank borrowings, commercial paper and letters of credit authorized by the Commission's Order dated January 11, 1995 in File No. 70-8521, Rel. No. 35-26215 (the "January 1995 Order") (in which the Commission authorized CINergy through January 31, 1997 to incur short-term indebtedness through bank borrowings, to issue notes and commercial paper, and to obtain letters of credit, all in an aggregate amount of up to $375 million), would not exceed $375 million at any one time. Such letters of credit would be pursuant to and within the limitations of the January 1995 Order. In the case of guarantees of exempt borrowings described in clauses (ii) and (iii) above, CINergy would issue guarantees and letters of credit only in support of borrowings made with interest rates of not more than 2% above the lender's prime rate in effect at the time of borrowing and maturities of not more than two years. Such guarantees and letters of credit would be issued in support of borrowings by CINergy Services, PSI Energy, CG&E, ULH&P, Lawrenceburg, West Harrison, Miami, Tri-State, KO, CINergy Investments, Inc., Power International, Inc., CINergy Technology, Inc. (formerly named PSI Environmental Corp.), PSI Recycling, Inc., Power Equipment Supply Co., Wholesale Power Services, Inc., and CG&E Resource Marketing, Inc. Except as may be permitted by applicable rules, regulations and orders of the Commission, proceeds of any such CINergy- guaranteed borrowings by the non-utility subsidiary companies referred to herein will be used only in businesses over which the Commission reserved jurisdiction in its October 21, 1994 order in File No. 70-8427 (Rel. No. 35-26146). The promissory notes issued in connection with the proposed borrowings are expected to be in substantially the form filed herewith as Exhibit 2. Each of such notes (a) would be for the principal amount to be borrowed at the time (if a "transactional" note) or for the principal amount outstanding from time to time (if a "grid" note) from the lending bank and be payable to the order of such bank, (b) would be issued on or before May 31, 1997 and would mature on a date no later than one year from the date of issuance, (c) would bear interest at a rate no higher than the effective cost of money for unsecured prime commercial bank loans prevailing on the date of such borrowing, and (d) would be subject to prepayment at the option of borrower, or under certain circumstances with the consent of the lending bank, in whole at any time or in part from time to time, without premium or penalty. Amounts outstanding under formal lines of credit typically would become due immediately upon an event of default, including non-payment, default under other agreements governing indebtedness, bankruptcy, or insolvency. Short-term notes may be issued on either a "grid" note basis or a transactional basis, under similar terms and conditions. Ordinarily, short-term grid notes are issued to a lending institution before the first borrowing under such note. The holder of the notes maintains the record of borrowings and repayments without the necessity of issuing additional notes. The actual terms of the notes may vary from the terms described above to reflect customary terms or particular lending practices and policies of different lending institutions, but otherwise are expected to be substantially similar. Compensation arrangements under lines of credit would be on a compensating balance and/or fee basis. In general, fees range from 5 basis points to 20 basis points (and will not exceed 25 basis points) per annum on the commitment, and balance arrangements require average balances of 5% to 10% (and will not exceed 10%) of the amount of the commitment. For letters of credit obtained by CINergy pursuant to the Commission's order in File No. 70-8521 in support of the bank borrowings described herein, the maximum amount of fees and expenses to be incurred by CINergy would not exceed 1% per year of the face amount of such letters of credit. Subject to the limitations on aggregate outstanding principal amount set forth in Item 1.A.1 above, authorization is also sought for PSI Energy, ULH&P, Lawrenceburg, West Harrison and Miami to issue notes in connection with borrowings of funds managed by the trust departments of banks if such borrowings would result in an estimated cost of money equal to or less than that available from the sale of commercial paper or other bank borrowings. Each such borrowing would be evidenced by notes payable on demand. 4. Commercial paper The short-term borrowing needs of PSI Energy have been met in part with the sale of commercial paper through commercial paper dealers (the "Dealers"). At any given time, PSI Energy may be able to issue commercial paper at a lower cost than that applicable to short-term bank borrowings. Accordingly, to provide financing flexibility, PSI Energy requests authority to issue and sell commercial paper, to one or more Dealers, subject to the limitations on aggregate outstanding principal amount stated in Item 1.A.1 above. There is no affiliation between PSI Energy or any of its subsidiaries, on the one hand, and any Dealer or any of its affiliates, on the other hand. The proceeds from the sale of commercial paper will be added to the seller's treasury funds and will be used for the purposes set forth in Item 1.A.2 above, including, without limitation, for the purpose of loans by the seller through the Utility Money Pool in the manner described in Item 1.A.5 below. The commercial paper which PSI Energy proposes to issue to Dealers will be in the form of book-entry unsecured promissory notes (in substantially the form filed herewith as Exhibit 3.1), with varying denominations of no less than $25,000 each. Such notes will be issued and sold by PSI Energy directly to Dealers at market rates. No commission or fee will be payable in connection with the issuance and sale of the commercial paper. The purchasing Dealer, however, will reoffer such notes at a rate less than the rate to the issuer and, as principal, will reoffer such notes in such a manner as not to constitute a public offering under the Securities Act of 1933. PSI Energy will issue and sell the proposed commercial paper to Dealers at a discount rate not in excess of the maximum discount rate per annum prevailing at the date of issuance for commercial paper of comparable quality of the particular maturity sold by public utility issuers thereof to Dealers. PSI Energy also requests authorization to sell commercial paper directly to certain financial institutions. Sales of commercial paper directly to such institutions will be undertaken only if the resulting cost of money is equal to or less than that available from Dealer-placed notes. The terms of any such notes would be similar to those of Dealer-placed notes. Maturities: The commercial paper issued by PSI Energy will have varying maturities of no more than 270 days from date of issue and will be issued and sold by PSI Energy from time to time through May 31, 1997. No such note will have a maturity date more than 270 days after May 31, 1997. Subject to such limitations, sales of commercial paper (and the bank borrowings described in Item 1.A.3) ordinarily will be structured to mature at such time as excess funds are expected to become available for loans through the money pool described in Item 1.A.5 below. Upon the availability of any such excess funds, external borrowings would be retired and loans refinanced to the extent such funds became available. 5. Utility Money Pool To coordinate and provide for their short-term cash and working capital requirements, PSI Energy, ULH&P, Lawrenceburg, Miami and West Harrison propose to issue and acquire from one another, and CINergy, CINergy Services, CG&E, Tri-State and KO propose to acquire from PSI Energy, ULH&P, Lawrenceburg, West Harrison and Miami, promissory notes in connection with a money pool (the "Utility Money Pool") to be established with CINergy, CINergy Services, Inc. ("CINergy Services"), a subsidiary service company for the CINergy system, CG&E, KO Transmission Co., a subsidiary of CG&E formed to acquire an interstate natural gas pipeline to which CG&E is entitled as a result of a settlement with the Columbia gas system, and Tri-State Improvement Co., a subsidiary of CG&E devoted to acquiring and holding property in Ohio, Kentucky and Indiana for substations, electric and gas rights of way, office space and other uses in the utility operations of CG&E and its utility subsidiaries. The proposed terms of the Utility Money Pool are summarized below and are memorialized in a definitive form of agreement filed herewith as Exhibit 5. Under the proposed terms of the Utility Money Pool, short-term funds would be available from the following sources for short-term loans to participants, including PSI Energy, ULH&P, Lawrenceburg, Miami and West Harrison, from time to time: (1) surplus funds in the treasuries of Utility Money Pool participants other than CINergy, (2) surplus funds in the treasury of CINergy, and (3) proceeds from bank borrowings by Utility Money Pool participants (other than borrowings by PSI Energy of more than 12 months pursuant to the Order of the IURC dated September 9, 1992 in Cause No. 39438) or the sale of commercial paper by CINergy, CG&E and PSI Energy for loan to the Utility Money Pool ("External Funds"). Funds would be made available from such sources in such order as CINergy Services, as administrator of the Utility Money Pool, may determine would result in a lower cost of borrowing, consistent with the individual borrowing needs and financial standing of the companies providing funds to the pool. The determination of whether a Utility Money Pool participant at any time has surplus funds to lend to the Utility Money Pool or shall lend funds to the Utility Money Pool would be made by such participant's chief financial officer or treasurer, or by a designee thereof, on the basis of cash flow projections and other relevant factors, in such participant's sole discretion. A separate Non-Utility Money Pool will be established by CINergy with certain other non-utility subsidiary companies of CINergy. Funds made available by CINergy for loans through the money pools will be made available first for loans through the Utility Money Pool and thereafter for loans through the Non-Utility Money Pool. Utility Money Pool participants that borrow would borrow pro rata from each company that lends, in the proportion that the total amount loaned by each such lending company bears to the total amount then loaned through the Utility Money Pool. On any day when more than one fund source (e.g., surplus treasury funds of CINergy and other Utility Money Pool participants ("Internal Funds") and External Funds), with different rates of interest, is used to fund loans through the Utility Money Pool, each borrower would borrow pro rata from each such fund source in the Utility Money Pool in the same proportion that the amount of funds provided by that fund source bears to the total amount of short-term funds available to the Utility Money Pool. Borrowings from the Utility Money Pool would require authorization by the borrower's chief financial officer or treasurer, or by a designee thereof. No party would be required to effect a borrowing through the Utility Money Pool if it is determined that it could (and had authority to) effect a borrowing at lower cost directly from banks or through the sale of its own commercial paper. No loans through the Utility Money Pool would be made to, and no borrowings through the Utility Money Pool would be made by, CINergy. Certain Costs: The cost of compensating balances and fees paid to banks to maintain credit lines by Utility Money Pool participants lending External Funds to the Utility Money Pool would initially be paid by the participant maintaining such line. A portion of such costs -- or all of such costs in the event a Utility Money Pool participant establishes a line of credit solely for purposes of lending any External Funds obtained thereby into the Utility Money Pool -- would be retroactively allocated every month to the companies borrowing such External Funds through the Utility Money Pool in proportion to their respective daily outstanding borrowings of such External Funds./2/ Interest Rate on Loans: If only Internal Funds comprise the funds available in the Utility Money Pool, the interest rate applicable to loans of such Internal Funds would be the CD yield equivalent of the 30-day Federal Reserve "AA" Industrial Commercial Paper Composite Rate (or if no such Composite Rate is established for that day, then the applicable rate would be the Composite Rate for the next preceding day for which such Composite Rate was established). The Composite Rate parallels the lenders' effective cost of capital with respect to such Internal Funds. If only External Funds comprise the funds available in the Utility Money Pool, the interest rate applicable to loans of such External Funds would be equal to the lending company's cost for such External Funds (or, if more than one Utility Money Pool participant had made available External Funds on such day, the applicable interest rate would be a composite rate equal to the weighted average of the cost incurred by the respective Utility Money Pool participants for such External Funds). In cases where both Internal Funds and External Funds are concurrently borrowed through the Utility Money Pool, the rate applicable to all loans comprised of such "blended" funds would be a composite rate equal to the weighted average of (a) the cost of all Internal Funds contributed by Utility Money Pool participants (as determined pursuant to the second preceding paragraph above) and (b) the cost of all such External Funds (as determined pursuant to the immediately preceding paragraph above). In circumstances where Internal Funds and External Funds are available for loans through the Utility Money Pool, loans may be made exclusively from Internal Funds or External Funds, rather than from a "blend" of such funds, to the extent it is expected that such loans would result in a lower cost of borrowing. Investment of Surplus Funds: Funds not required by the Utility Money Pool to make loans (with the exception of funds required to satisfy the Utility Money Pool's liquidity requirements) would ordinarily be invested in one or more short-term investments, including: (i) interest-bearing accounts with banks; (ii) obligations issued or guaranteed by the U.S. government and/or its agencies and instrumentalities, including obligations under repurchase agreements; (iii) obligations issued or guaranteed by any state or political subdivision thereof, provided that such obligations are rated not less than A by a nationally recognized rating agency; (iv) commercial paper rated not less than A-1 or P-1 or their equivalent by a nationally recognized rating agency; (v) money market funds; (vi) bank certificates of deposit, (vii) Eurodollar funds; and (viii) such other investments as are permitted by Section 9(c) of the Act and Rule 40 thereunder. Allocation of Interest Income and Investment Earnings: The interest income and investment income earned on loans and investments of surplus funds would be allocated among the participants in the Utility Money Pool in accordance with the proportion each participant's contribution of funds bears to the total amount of funds in the Utility Money Pool and the cost of funds provided to the Utility Money Pool by such participant. Repayment: Each Applicant receiving a loan through the Utility Money Pool would be required to repay the principal amount of such loan, together with all interest accrued thereon, on demand and in any event not later than one year after the date of such loan. All loans made through the Utility Money Pool could be prepaid by the borrower without premium or penalty. Form of Loans to Applicants: Under the authorization requested herein, all loans through the Utility Money Pool would be made on or before May 31, 1997. Each lender would receive one or more promissory notes evidencing any and all loans by such lender. Such notes would be substantially in the form filed as Exhibit 4, would be dated as of the date of the initial borrowing (and in any event not later than May 31, 1997), would mature on demand, or on a date agreed by the parties (but in any case not later than one year after the date of the applicable borrowing), and would be prepayable in whole at any time or in part from time to time, without premium or penalty. Interest would be accrued by each borrower monthly. Additional provisions: Operation of the Utility and Non-Utility Money Pools, including record keeping and coordination of loans, will be handled by CINergy Services under the authority of the appropriate officers of the participating companies. CINergy Services will administer the Utility and Non-Utility Money Pools on an "at cost" basis and will maintain separate records for each money pool. Surplus funds of the Utility Money Pool and the Non-Utility Money Pool may be combined in common short-term investments, but separate records of such funds shall be maintained by CINergy Services as administrator of the pools, and interest thereon shall be separately allocated, on a daily basis, to each money pool in accordance with the proportion that the amount of each money pool's surplus funds bears to the total amount of surplus funds available for investment from both money pools. Within 45 days after the end of each calendar quarter, CINergy Services, on behalf of the Applicants, will file a certificate with the Commission pursuant to Rule 24 under the Act setting forth (i) each Applicant's maximum principal amount of short-term borrowings outstanding during such quarter, (ii) the average rate for the Utility Money Pool during such period, and (iii) the maximum amount outstanding during such period for each source of outside borrowings. Within 45 days after the end of each calendar quarter, CINergy Services, on behalf of the participating companies in the Non-Utility Money Pool, will file with the Commission a certificate of notification on Form U-6B-2 pursuant to Rule 52 including the following information for each participating company: a. The aggregate dollar amount lent to the Non-Utility Money Pool by such company in the preceding calendar quarter, including as to each month thereof; b. The aggregate dollar amount borrowed from the Non-Utility Money Pool by such company in the preceding calendar quarter, including as to each month thereof; c. A statement explaining that company's use of the proceeds of such borrowings during such calendar quarter; and d. The type of business engaged in by such company during such calendar quarter. B. Statement Pursuant to Rule 54 Applicants do not intend at present to use the borrowings proposed herein to finance the acquisition of an exempt wholesale generator ("EWG") or a foreign utility company ("FUCO"). If the Applicants' intention changes, an amended Application- 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. Four 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 para. 61,335 (1992), and PSI Argentina, Inc., 68 FERC para. 61,286 (1994). E P EDEGEL, Inc. was determined to be an EWG by the FERC in E P EDEGEL, Inc., 68 FERC para. 61,265 (1994). PSI Energy Argentina ("Energy Argentina") is a FUCO and has filed 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. and PSI Yacyreta, 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 currently maintains 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, in English, 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., Holding Co. Act 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 granting the CINergy Merger U-1, CINergy Services 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 Application-Declaration, and will submit copies of any Rule 24 certificates 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 its pending Application-Declaration 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. C. Energy Partners is not a "subsidiary company" of CINergy Through its indirect subsidiary CG&E Resource Marketing, Inc., CINergy holds a one-third partnership interest in Energy Partners, a gas marketing partnership with Public Service Electric & Gas Company. Resource Marketing was formed to compete with traditional regulated local distribution companies by offering "merchant service" (i.e., acquiring natural gas and selling it to customers) and to broker gas to industrial and large commercial customers, with the initial aim of recapturing former customers of CG&E's gas utility business. CINergy's interest in Energy Partners is a minority interest, with the remaining majority interest held by one partner unaffiliated with CINergy. For this and other reasons set forth in the legal memorandum filed herewith (Exhibit 16 hereto), CINergy does not "control" Energy Partners or possess a "controlling influence" over its management or policies, and hereby requests an order by the Commission that Energy Partners is not a "subsidiary company" of CINergy within the meaning of Section 2(a)(8) of the Act. Item 2. Fees, Commissions and Expenses. An estimate of the fees and expenses to be paid or incurred by the Applicants in connection with the proposed transactions is set forth below: Amount Holding Company Act filing fee. . . . . . $ 2,000* Rating agency fees for commercial paper (annual). . . . . . . . . . . . . . 10,000 Counsel fees. . . . . . . . . . . . . . . 80,000 Charges of CINergy Services . . . . . . . 80,000 Miscellaneous and incidental expenses including travel, telephone and postage . . . . . . . . . . . . . . . . . 3,000 Total . . . . . . . . . . . . . . . . . . $175,000 _______________ *Actual amount. Fees with respect to bank borrowings are set forth in Item 1. Item 3. Applicable Statutory Provisions. Sections 2(a)(8), 6, 7, 9(a), 10, 12(b), 12(f) and 13 of the Act and Rules 40, 43, 45, 53, 54 and 80-95 thereunder are or may be applicable to one or more of the proposed transactions. To the extent any other sections of the Act and the Commission's rules thereunder may be applicable to the proposed transactions, the Applicants hereby request appropriate orders thereunder. Item 4. Regulatory Approval. PSI Energy, West Harrison, Lawrenceburg and Miami: Under the Indiana Code, IURC authorization is not required for borrowings of 12 months or less by Indiana utility companies and is therefore not required for the borrowings by PSI Energy (including the issuance of commercial paper by PSI Energy), West Harrison, Lawrenceburg and Miami proposed herein. The Indiana Code does not limit the use of such 12-month-or-less borrowings or preclude the use of the proceeds of such borrowings for purposes of making loans through the Utility Money Pool, and IURC authorization is not required for PSI Energy, West Harrison, Lawrenceburg or Miami to lend the proceeds of such 12-month-or-less borrowings through the Utility Money Pool as proposed herein. ULH&P: Pursuant to an Order issued on October 25, 1994 in FERC Docket No. ES94-43-000 (Exhibit 9 hereto), ULH&P presently has all necessary authority from the FERC to issue up to $35,000,000 of unsecured promissory notes through December 31, 1996. No additional authorization from the Kentucky Public Service Commission ("KPSC") is required under Kentucky law for the ULH&P borrowings proposed herein. Additional approvals: Pursuant to the terms of certain settlement agreements, commitments and orders relating to the mergers that resulted in the formation of the CINergy system, CINergy is required to submit certain proposed inter-affiliate agreements subject to the Commission's jurisdiction (including the proposed Utility Money Pool Agreement) to the IURC and the Public Utilities Commission Ohio ("PUCO") for their review (over a period of up to 60 days) before filing such agreements with the Commission. During such review period, the applicable state commission may (among other things) reject, disapprove or find unreasonable the proposed inter-affiliate agreement, as more fully described in Item 3.B of the CINergy Merger U-1. On April 4, 1995, copies of the Utility Money Pool Agreement were submitted to the IURC and the PUCO. On June 29, 1995, PSI Energy submitted a letter to the IURC Staff (Exhibit 8.1 hereto) in which PSI Energy agreed to provide the IURC with certain information on a periodic basis relating to PSI Energy's participation in the Utility Money Pool to be filed by PSI Energy with the Commission pursuant to Item 1 hereof. On July 19, 1995, the IURC Staff provided PSI Energy with a letter (Exhibit 8.2 hereto) clearing the Utility Money Pool Agreement. On May 4, 1995, the PUCO issued an order in Case No. 95-275-GE-AIS approving the Utility Money Pool Agreement (Exhibit 7.1 hereto). Except as described above, no state or federal regulatory authority, other than the Commission under the Act, has jurisdiction over any of the proposed transactions, and no other state or federal authorizations are required for the transactions described herein. Item 5. Procedure. It is requested that the Commission issue and publish no later than March 17, 1995, the requisite notice under Rule 23 with respect to the filing of this Application- Declaration, such notice to specify a date not later than April 11, 1995 as the date after which an order granting and permitting this Application-Declaration to become effective may be entered by the Commission and that the Commission enter not later than April 12, 1995, an appropriate order granting and permitting this Application-Declaration to become effective. No recommended decision by a hearing officer or other responsible officer of the Commission is necessary or required in this matter. The Division of Investment Management of the Commission may assist in the preparation of the Commission's decision in this matter. There should be no thirty-day waiting period between the issuance and the effective date of any order issued by the Commission in this matter, and it is respectfully requested that any such order be made effective immediately upon the entry thereof. Item 6. Exhibits and Financial Statements. Exhibit 1.1 - Withdrawn. Exhibit 1.2 - Withdrawn. Exhibit 1.3 - Withdrawn. Exhibit 1.4 - Withdrawn. Exhibit 1.5 - Withdrawn. Exhibit 1.6 - Withdrawn. Exhibit 1.7 - Withdrawn. Exhibit 1.8 - Withdrawn. Exhibit 1.9 - Withdrawn. Exhibit 1.10 - Withdrawn. Exhibit 1.11 - Withdrawn. Exhibit 1.12 - Withdrawn. Exhibit 1.13 - Letter agreement between ULH&P and Star Bank and Grid Note ($7,500,000). Exhibit 1.14 - Letter agreement between ULH&P and The Fifth Third Bank and Promissory Note ($7,500,000). Exhibit 1.15 - Letter agreement between ULH&P and Central Trust Company and Amended and Restated Grid Note in favor of PNC Bank, Ohio, National Association ($7,500,000). Exhibit 1.16 - Letter agreement between ULH&P and National City Bank, Kentucky, and Master Promissory Note in favor of First National Bank of Louisville ($7,500,000). Exhibit 1.17 - Letter agreement between The Lawrenceburg Gas Company and Star Bank N.A., Indiana ($400,000). Exhibit 1.18 - Withdrawn. Exhibit 1.19 - Withdrawn. Exhibit 1.20 - Committed Line of Credit Agreement between PSI Energy and Barclays Bank PLC and Grid Note of same date ($15,000,000). Exhibit 1.21 - Withdrawn. Exhibit 1.22 - Letter agreement between PSI Energy and The Chase Manhattan Bank, N.A., Promissory Note, and amendment letters ($30,000,000). Exhibit 1.23 - Withdrawn. Exhibit 1.24 - Amended and Restated Revolving Note by PSI Energy in favor of The Fifth Third Bank ($15,000,000). Exhibit 1.25 - Withdrawn. Exhibit 1.26 - Letter agreement between PSI Energy and Bank of Montreal and Unsecured Note ($27,000,000). Exhibit 1.27 - Withdrawn. Exhibit 1.28 - Withdrawn. Exhibit 1.29 - Withdrawn. Exhibit 1.30 - Revolving Credit Agreement between PSI Energy and Swiss Bank Corporation, New York Branch, Promissory Note, and Amendment No. 2 ($15,000,000). Exhibit 1.31 - Withdrawn. Exhibit 2 - Form of note to evidence borrowings from banks. Exhibit 3 - Withdrawn. Exhibit 3.1 - Form of commercial paper note of PSI Energy (filed herewith). Exhibit 4 - Form of note to be executed by borrowing Applicants to lending Applicants. Exhibit 5 - Form of Utility Money Pool Agreement (filed herewith). Exhibit 6 - Withdrawn. Exhibit 6.1 - Withdrawn. Exhibit 7 - Withdrawn. Exhibit 7.1 - Order of PUCO dated May 4, 1995 in Case No. 95-275-GE-AIS (filed herewith) Exhibit 8 - Withdrawn. Exhibit 8.1 - Letter from PSI Energy to IURC Staff dated June 29, 1995 (filed herewith). Exhibit 8.2 - Letter from Robert C. Glazier, Director of Utilities for the IURC, to PSI Energy dated July 19, 1995 (filed herewith). Exhibit 9 - FERC Order issued October 25, 1994 (Docket No. ES94-43-000). Exhibit 10 - Withdrawn. Exhibit 10.1 - Withdrawn. Exhibit 10.2 - Revised preliminary opinion of counsel (filed herewith). Exhibit 11 - Final or "past tense" opinion of counsel (to be filed with certificate of notification). Exhibit 12 - Proposed notice of proceeding. Exhibit 13 - Withdrawn. Exhibit 14 - Financial statements of CINergy, PSI Energy, ULH&P, West Harrison and Miami. Exhibit 14.1 - Financial statements of CINergy Services, CG&E, Tri-State and KO (filed herewith). Exhibit 15 - U.S. Energy Partners General Partnership Agreement Effective as of January 1, 1994. Exhibit 16 - Legal memorandum. Exhibit 27 - Financial data schedules of CINergy, PSI Energy, ULH&P, Lawrenceburg, West Harrison and Miami (filed with electronic submission only). Exhibit 27.1 - Financial data schedules of CINergy Services, CG&E, Tri-State and KO (filed herewith as part of electronic submission only). Item 7. Information as to Environmental Effects. The proposed transactions do not involve major federal action having a significant effect on the human environment. To the best of the Applicants' knowledge no federal agency has prepared or is preparing an environmental impact statement with respect to the proposed transactions. Item 8. Power of Attorney. KNOW ALL MEN BY THESE PRESENTS, that each person signing below constitutes J. Wayne Leonard, Jackson H. Randolph and William L. Sheafer, and each of them, with full power to act without the others, his lawful attorney-in-fact and agent, with full power of substitution and resubstitution, for him and in his name, in any capacity, to sign any further amendment to this Application-Declaration, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Commission granting unto the attorneys-in-fact and agents, and each of them, full authority to do each act necessary to be done, as fully to all purposes as he might do in person, hereby ratifying all that the attorneys-in-fact and agents or any of them, or their or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof. 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 companies have duly caused this document to be signed on their behalf by the undersigned thereunto duly authorized. Dated: August 23, 1995 CINergy CORP. By:/s/WILLIAM L. SHEAFER William L. Sheafer Treasurer PSI ENERGY, INC. By:/s/WILLIAM L. SHEAFER William L. Sheafer Treasurer THE CINCINNATI GAS & ELECTRIC COMPANY By:/s/WILLIAM L. SHEAFER William L. Sheafer Treasurer THE UNION LIGHT, HEAT AND POWER CO. By:/s/WILLIAM L. SHEAFER William L. Sheafer Treasurer THE WEST HARRISON GAS AND ELECTRIC CO. By:/s/WILLIAM L. SHEAFER William L. Sheafer Treasurer LAWRENCEBURG GAS CO. By:/s/WILLIAM L. SHEAFER William L. Sheafer Treasurer MIAMI POWER CORPORATION By:/s/WILLIAM L. SHEAFER William L. Sheafer Treasurer CINergy SERVICES, INC. By:/s/WILLIAM L. SHEAFER William L. Sheafer Treasurer KO TRANSMISSION CO. By:/s/WILLIAM L. SHEAFER William L. Sheafer Treasurer TRI-STATE IMPROVEMENT CO. By:/s/WILLIAM L. SHEAFER William L. Sheafer Treasurer Endnotes /1/ PSI Energy's other credit lines provide for maturity dates that are more than 12 and less than 24 months from the date of each loan. Such 12- to 24-month borrowings by PSI Energy are subject to the jurisdiction of the Indiana Utility Regulatory Commission ("IURC") and were approved by the IURC by Order dated September 9, 1992 in Cause No. 39438 and are exempt from Commission approval pursuant to Rule 52. /2/ For example, if a company borrowed $1 million in External Funds for ten days during a monthly period, and such funds were derived from a $10 million line of credit bearing a 1% annual fee, the borrowing company's share of such fee (assuming a 360-day year) would equal (1% X $10,000,000) X ($1,000,000 / $10,000,000) X (10 / 360), or approximately $277.78. EXHIBIT INDEX The number in parentheses after each exhibit description refers to the number of the amendment to this Application-Declaration with which that exhibit was filed. Exhibits marked "(0)" were filed with the initial Application-Declaration. Exhibit Transmission Number Exhibit Method 1.1 Withdrawn. 1.2 Withdrawn. 1.3 Withdrawn. 1.4 Withdrawn. 1.5 Withdrawn. 1.6 Withdrawn. 1.7 Withdrawn. 1.8 Withdrawn. 1.9 Withdrawn. 1.10 Withdrawn. 1.11 Withdrawn. 1.12 Withdrawn. 1.13 Letter agreement between Form SE ULH&P and Star Bank and Grid Note ($7,500,000) (1). 1.14 Letter agreement between ULH&P Form SE and The Fifth Third Bank and Promissory Note ($7,500,000) (1). 1.15 Letter agreement between ULH&P and Form SE Central Trust Company and Amended and Restated Grid Note in favor of PNC Bank, Ohio, National Association ($7,500,000) (1). 1.16 Letter agreement between ULH&P and Form SE National City Bank, Kentucky, and Master Promissory Note in favor of First National Bank of Louisville ($7,500,000) (1). 1.17 Letter agreement between The Lawrenceburg Form SE Gas Company and Star Bank N.A., Indiana ($400,000) (1). 1.18 Withdrawn. 1.19 Withdrawn. 1.20 Committed Line of Credit Agreement Form SE between PSI Energy and Barclays Bank PLC and Grid Note ($15,000,000) (1). 1.21 Withdrawn. 1.22 Letter agreement between PSI Energy and Form SE The Chase Manhattan Bank, N.A., Promissory Note, and amendment letters ($30,000,000) (1). 1.23 Withdrawn. 1.24 Amended and Restated Revolving Note by Form SE PSI Energy in favor of The Fifth Third Bank ($15,000,000) (1). 1.25 Withdrawn. 1.26 Letter agreement between PSI Energy and Form SE Bank of Montreal and Unsecured Note ($27,000,000) (1). 1.27 Withdrawn. 1.28 Withdrawn. 1.29 Withdrawn. 1.30 Revolving Credit Agreement between PSI Form SE Energy and Swiss Bank Corporation, New York Branch, Promissory Note, and Amendment No. 2 ($15,000,000) (1). 1.31 Withdrawn. 2 Form of note to evidence borrowings from banks (0). Electronic 3 Withdrawn. 3.1 Form of commercial paper note of PSI Energy (3) Electronic 4 Form of note to be executed by borrowing Applicants to lending Applicants (0). Electronic 5 Form of Utility Money Pool Agreement (2). Electronic 6 Withdrawn. 6.1 Withdrawn. 7 Withdrawn. 7.1 Order of PUCO dated May 4, 1995 in Case No. 95-275-GE-AIS (3). Electronic 8 Withdrawn. 8.1 Letter from PSI Energy to IURC Staff dated June 29, 1995 (2). Electronic 8.2 Letter from Robert C. Glazier, Director of Utilities for the IURC, to PSI Energy dated July 19, 1995 (2). Electronic 9 FERC Order issued October 25, 1994 (Docket No. ES94-43-000) (1). Form SE 10 Withdrawn. 10.1 Withdrawn. 10.2 Revised preliminary opinions of counsel (3) Electronic 11 Final or "past tense" opinions of counsel (to be filed with certificate of notification). -- 12 Proposed notice of proceeding (0). Electronic 13 Withdrawn. 14 Financial statements of CINergy, PSI Energy, Electronic ULH&P, Lawrenceburg, West Harrison and Miami (2). 14.1 Financial statements of CINergy Services, Electronic CG&E, Tri-State and KO (3). 15 U.S. Energy Partners General Partnership Agreement Effective as of January 1, 1994 (2). Form SE 16 Legal memorandum (2). Electronic 27 Financial data schedules of CINergy, PSI Energy, ULH&P, Lawrenceburg, West Harrison and Miami (filed with electronic submission only) (2). Electronic 27.1 Financial data schedules of CINergy Services, CG&E, Tri-State and KO (filed with electronic submission only) (3). Electronic EX-3.1 2 EXHHIBIT 3.1 EXHIBIT 3.1 FORM OF COMMERCIAL PAPER NOTE (BOOK-ENTRY) PSI ENERGY, INC. COMMERCIAL PAPER MASTER NOTE ____________________________ (Date of Issuance) PSI Energy, Inc., a corporation organized and existing under the laws of the State of Indiana (the "Issuer"), for value received, hereby promises to pay to Cede & Co. or registered assigns on the maturity date of each commercial paper note identified on the records of the Issuer (which records are maintained by Bank (the "Paying Agent")) the principal amount for each such commercial paper note. Payment shall be made by wire transfer to the registered owner from the Paying Agent without the necessity of presentation and surrender of this Master Note. REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS MATER NOTE SET FORTH ON THE REVERSE HEREOF This Master Note is a valid and binding obligation of the Issuer. PSI ENERGY, INC. By:__________________________ (Issuer) (Reverse Side of Note) At the request of the registered owner, PSI Energy, Inc. shall promptly issue and deliver one or more separate note certificates evidencing each commercial paper note evidenced by this Master Note. As of the date any such note certificate or certificates are issued, the commercial paper notes which are evidenced thereby shall no longer be evidenced by this Master Note. FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto ______________________ the Master Note and all rights thereunder, hereby irrevocably constituting and appointing ____________________ Attorney to transfer said Master Note on the books of the Issuer with full power of substitution in the premises. Dated: ________________________________ (Signature) Siganture(s) Guaranteed: NOTICE: The signature on this assignment must correspond with the name as written upon the face of this Master Note, in every particular, without alteration or enlargement or any change whatsoever. UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55 WATER STREET, NEW YORK, NEW YORK) TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT IS MADE TO CEDE & CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN. EX-10.2 3 EXHHIBIT 10.2 EXHIBIT 10.2 Milbank, Tweed, Hadley & McCloy 1 Chase Manhattan Plaza New York, NY 10005 August 23, 1995 Securities and Exchange Commission 450 Fifth Street, N.W. Washington, D.C. 20549 Re: Form U-1 Application-Declaration -- File No. 70-8587 Dear Sirs: We refer to the Form U-1 Application-Declaration, as amended and restated by Amendment No. 3 thereto (the "Amended and Restated Application -Declaration"), filed by CINergy Corp. ("CINergy"), a Delaware corporation and a registered public utility holding company under the Public Utility Holding Company Act of 1935, as amended (the "Act"), and its subsidiary companies PSI Energy, Inc. ("PSI Energy"), The Cincinnati Gas & Electric Co. ("CG&E"), The Union Light, Heat and Power Co. ("ULH&P"),Lawrenceburg Gas Co. ("Lawrenceburg"), The West Harrison Gas and Electric Co. ("West Harrison"), Miami Power Corp. ("Miami"), KO Transmission Co. ("KO"), Tri-State Improvement Co. ("Tri-State") and CINergy Services, Inc. ("CINergy Services"). Capitalized terms not defined herein shall have the meanings ascribed to such terms in the Amended and Restated Application-Declaration. The Amended and Restated Application-Declaration requests: (a) authorization (i) for PSI Energy, ULH&P, Lawrenceburg, West Harrison and Miami to issue notes in connection with short-term borrowings with maturities of 12 months or less from banks and bank trust departments as set forth in Item 1.A.3 of the Amended and Restated Application-Declaration and through a Utility Money Pool as set forth in Item 1.A.5 of the Amended and Restated Application-Declaration; (ii) for PSI Energy, ULH&P, Lawrenceburg, West Harrison and Miami to lend and extend credit to (and acquire promissory notes from) one another, and for CINergy, CINergy Services, CG&E, Tri-State and KO to lend and extend credit to (and acquire promissory notes from) PSI Energy, ULH&P, Lawrenceburg, West Harrison and Miami, in connection with borrowings by PSI Energy, ULH&P, Lawrenceburg, West Harrison and Miami through the Utility Money Pool; (iii) for CINergy, in connection with borrowings by its subsidiary companies from banks and bank trust departments pursuant to the authorization described in clause (i) above or applicable rules of the Commission, to issue guarantees and letters of credit as set forth in Item 1.A.3.b of the Amended and Restated Application-Declaration; and (iv) for PSI Energy to issue commercial paper as set forth in Item 1.A.4 of the Amended and Restated Application- Declaration; and (b) an order of the Commission declaring that U.S. Energy Partners ("Energy Partners"), a partnership in which CINergy holds an interest, is not a "subsidiary company" of CINergy within the meaning of Section 2(a)(8) of the Act (collectively, the "Transactions"). We have acted as special counsel for CINergy in connection with the Transactions and, as such counsel, we are familiar with the corporate proceedings taken and to be taken by CINergy in connection with the Transactions as described in the Amended and Restated Application- Declaration. We have examined originals, or copies certified to our satisfaction, of such corporate records of CINergy, certificates of public officials, certificates of officers and representatives of CINergy, and other documents as we have deemed it necessary to require as a basis for the opinions hereinafter expressed. In such examination we have assumed the genuineness of all signatures and the authenticity of all documents submitted to us as originals and the conformity with the originals of all documents submitted to us as copies. As to various questions of fact material to such opinions we have, when relevant facts were not independently established, relied upon certificates by officers of CINergy and other appropriate persons and statements contained in the Amended and Restated Application-Declaration. The opinions expressed below in respect of the Transactions described in the Amended and Restated Application-Declaration are subject to the following assumptions or conditions: a. The Transactions shall have been duly authorized and approved to the extent required by state law by the Board of Directors of each Applicant. b. The Securities and Exchange Commission shall have duly entered an appropriate order or orders granting the Amended and Restated Application-Declaration and permitting the Amended and Restated Application-Declaration to become effective with respect to the Transactions. c. The Transactions shall have been accomplished in accordance with all approvals, authorizations, consents, certificates and orders of any applicable state commission or regulatory authority required for the consummation of the Transactions, and all such required approvals, authorizations, consents, certificates and orders shall have been obtained and remain in effect. d. The commercial paper and other notes proposed to be issued by PSI Energy to non-associate companies, the notes proposed to be issued by borrowing Applicants to lending Applicants, and the notes proposed to be guaranteed by CINergy shall be substantially in the forms attached as exhibits to the Amended and Restated Application- Declaration and shall be properly completed and executed and, where required, countersigned. e. The rates of interest on the commercial paper and notes that are the subject of the Amended and Restated Application-Declaration shall not exceed the interest rates permitted by applicable state and federal law. f. Borrowings will not exceed those levels permitted from time to time by the borrowing Applicant's Articles or Certificate of Incorporation or other governing corporate documents and debt instruments and agreements to which the borrowing Applicant is a party or by which its property is bound, and applicable laws and orders of governmental and regulatory authorities with jurisdiction over such borrowing Applicant. g. The note of ULH&P in favor of First National Bank of Louisville filed in Exhibit 1.16 to the Amended and Restated Application-Declaration would be governed by and construed in accordance with the laws of the Commonwealth of Kentucky, without giving effect to the conflicts-of-laws rules thereof. The notes of ULH&P in favor of Star Bank, N.A., The Fifth Third Bank, and The Central Trust Company filed in Exhibits 1.13, 1.14 and 1.15, respectively, to the Amended and Restated Application-Declaration would be governed by and construed in accordance with the laws of the State of Ohio, in accordance with the choice-of-law provisions of such notes, and the note of PSI Energy in favor of The Fifth Third Bank filed as Exhibit 1.24 to the Amended and Restated Application- Declaration, would be governed by and construed in accordance with the laws of the State of Ohio, in each case without giving effect to the conflicts-of-laws rules thereof. The notes issued by Lawrenceburg pursuant to the letter agreement between Lawrenceburg and Star Bank N.A., Indiana filed as Exhibit 1.17 and the note of PSI Energy in favor of the Bank of Montreal filed in Exhibit 1.26 to the Amended and Restated Application-Declaration would be governed by and construed in accordance with the laws of the State of Indiana, without giving effect to the conflicts-of-laws rules thereof. It is further assumed that the laws of the State of Indiana relevant to the validity and enforceability of notes are substantially similar in all relevant respects to the laws of the State of Illinois referred to in the choice-of-law provision of the note filed in Exhibit 1.26. The notes filed in Exhibits 1.20, 1.22 and 1.30 to the Amended and Restated Application-Declaration would be governed by and construed in accordance with the laws of the State of New York, in accordance with the choice-of-law provisions of such notes and without giving effect to the conflicts-of-laws rules of New York law. All notes issued (or guaranteed by CINergy) in connection with the borrowings from banks and bank trust departments and the guarantees proposed in Item 1.A.3 of the Amended and Restated Application-Declaration would be in substantially the form of the note filed as Exhibit 2 thereto and would be governed by and construed in accordance with the laws of the State of Ohio (in the case of notes issued by CG&E, Tri-State, Power International, Inc., CINergy Services, CINergy Investments, and CG&E Resource Marketing, and guarantees thereof by CINergy), the State of Indiana (in the case of notes issued by PSI Energy, Lawrenceburg, West Harrison, Miami, PSI Recycling, Inc., CINergy Technology, Inc., Power Equipment Supply Co., and Wholesale Power Services, Inc. and guarantees thereof by CINergy), the Commonwealth of Kentucky (in the case of notes issued by ULH&P and KO and guarantees thereof by CINergy), in each case without giving effect to the conflicts-of-laws rules thereof. All notes issued by PSI Energy in connection with the commercial paper issuances proposed in Item 1.A.4 of the Amended and Restated Application-Declaration would be in substantially the form of the note filed as Exhibit 3.1 thereto and would be governed by and construed in accordance with the laws of the State of Indiana, in accordance with the choice-of-law provision of such form of note and without giving effect to the conflicts-of-laws rules of Indiana law. All notes issued in connection with borrowings through the Utility Money Pool proposed in Item 1.A.5 of the Amended and Restated Application-Declaration would be in substantially the form of the note filed as Exhibit 5 thereto and would be governed by and construed in accordance with the laws of the State of Ohio, in accordance with the choice-of-law provision of the Utility Money Pool Agreement and without giving effect to the conflicts-of-laws rules of Ohio law. h. No act or event other than as described herein shall have occurred subsequent to the date hereof which would change the opinions expressed above. i. The consummation of the Transactions shall be conducted under our supervision, and all legal matters incident thereto shall be satisfactory to us, including the receipt in satisfactory form of such opinions of other counsel, qualified to practice in jurisdictions pertaining to the Transactions in which we are not admitted to practice, as we may deem appropriate. Based upon the foregoing, and having regard to legal considerations which we deem relevant, we are of the opinion that, in the event that the proposed Transactions are consummated in accordance with the Amended and Restated Application-Declaration, as it may be amended, and subject to the assumptions and conditions set forth above and the reliances and limitations set forth below: 1. CINergy and CINergy Services are validly incorporated and duly existing under the laws of the State of Delaware. PSI Energy, Lawrenceburg, West Harrison and Miami are validly incorporated and duly existing under the laws of the State of Indiana. CG&E and Tri- State are validly incorporated and duly existing under the laws of the State of Ohio. ULH&P and KO are validly incorporated and duly existing under the laws of the Commonwealth of Kentucky. CINergy Investments, Inc. and CG&E Resource Marketing, Inc., each of which was incorporated under the laws of the State of Delaware; PSI Recycling, Inc., CINergy Technology, Inc., Power Equipment Supply Co., and Wholesale Power Services, Inc., each of which was incorporated under the laws of the State of Indiana; and Power International, Inc., which was incorporated under the laws of the State of Ohio -- which would be the issuers of certain notes proposed to be guaranteed by CINergy -- are validly incorporated and duly existing under the laws of their respective states of incorporation set forth above. 2. All state laws applicable to the proposed Transactions will have been complied with. 3. Each lending Applicant will legally acquire the promissory notes issued to such lending Applicant by borrowing Applicants in connection with borrowings through the Utility Money Pool. 4. The commercial paper proposed to be issued by PSI Energy and the notes proposed to be issued by Applicants will be valid and binding obligations of the respective issuer of such notes, and the notes proposed to be guaranteed by CINergy will be valid and binding obligations (or valid and binding contingent obligations, as the case may be) of the respective issuer of such notes and of CINergy, in each case enforceable in accordance with the terms of such note or guarantee, as the case may be, except as enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors' rights generally and the application of general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law). 5. The consummation of the proposed Transactions will not violate the legal rights of the holders of any securities issued by any Applicant or any associate company thereof. We do not herein purport to express any opinions as to any laws other than the Federal laws of the United States, the laws of the State of New York, the General Corporation Law of the State of Delaware, and the laws of the States of Ohio and Indiana and the Commonwealth of Kentucky. As to matters arising under the laws of the States of Ohio and Indiana and the Commonwealth of Kentucky, in which we are not admitted to practice, the opinions expressed herein are based upon and given in reliance upon opinions of even date herewith by Messrs. Jerome A. Vennemann, Esq., Frank Lewis, Esq., and Taft, Stettinius & Hollister, respectively, which opinions are subject to assumptions, conditions and limitations substantially similar to those set forth herein. No opinion is expressed as to the choice-of-law or forum provisions of any of the notes, agreements or other instruments filed as exhibits to the Amended and Restated Application- Declaration or any choice-of-law or forum issue relating thereto. We hereby consent to the use of this opinion as an exhibit to the Amended and Restated Application-Declaration. The opinions set forth herein are issued and expressed as of the date hereof. We do not assume or undertake any responsibility to advise you of changes in either fact or law which may come to our attention after the date hereof. Very truly yours, /s/Milbank, Tweed, Hadley & McCloy Milbank, Tweed, Hadley & McCloy MDD/RBW/RJH EX-99.7.1 4 EXHIBIT 7.1 File No. 70-8587 Exhibit 7.1 CONFORMED COPY BEFORE THE PUBLIC UTILITIES COMMISSION OF OHIO In the Matter of the Application of ) The Cincinnati Gas & Electric ) Case No. 95-275-GE-AIS Company for Authority to Enter ) Into A Utility Money Pool Contract. ) In the Matter of the Application of ) The Cincinnati Gas & Electric ) Company for Authority to Issue ) Short-Term Securities Not in Excess ) Case No. 95-358-GE-AIS of $400,000,000 At Any One Time of ) Unsecured Notes and Other Evidences ) of Indebtedness. ) FINDING AND ORDER The Commission finds: (1) Applicant, The Cincinnati Gas & Electric Company, is an Ohio corporation and apublic utility as defined in Section 4905.02 Revised Code, and is subject to the jurisdictionof this Commission. (2) These Applications comply with the provisions of Sections 4905.40, 4905.401(A)and 4905.41, Revised Code. (3) Applicant has existing authority (Case No. 94-811-GE-AIS), through June 30, 1995,to issue and/or renew its unsecured notes and other evidences of short-term indebtedness, including commercial paper, maturing for periods of not more than twelve months, provided that the aggregate principal amount of short-term indebtedness will not exceed $200 million at any one time. (4) To supplement and replace such existing authority, Applicant is now requesting consent and authority (Case No. 95-358-GE-AIS), through June 30, 1996, to continue to issue and/or renew its unsecured notes and other evidences of short-term indebtedness, including commercial paper, maturing for periods of not more than twelve months, in an aggregate principal amount of up to $400 million. (5) Pursuant to Section 4905.401, Revised Code, Applicant was permitted to have outstanding notes and other evidences of short-term indebtedness issuable without prior authority of this Commission (the "Statutory Exemption") in the amount of $141 million, as of December 31, 1994. Applicant had no short-term debt outstanding, as of December 31, 1994. (6) The proceeds from the issuance of short-term indebtedness will be used for the acquisition of property; the construction program; completion, extension, renewal and improvement of Applicant's facilities and service; to reimburse its treasury for actual funds expended; to repay outstanding short-term notes or other evidences of indebtedness, including Applicant's participation in a utility money pool arrangement; for working capital and general corporate purposes. (7) To facilitate Applicant's participation in a utility money pool arrangement, Applicant is also requesting authority (Case No. 95-275-GE-AIS) to enter into and file at the Securities and Exchange Commission (SEC) a utility money pool contract (the "Money Pool") in order to establish an intrasystem financing arrangement, by and among Applicant; its parent company, CINergy, Corp. ("CINergy"); CINergy Services, Inc. ("CINergy Services"), a service company of CINergy; PSI Energy, Inc. ("PSI Energy"), a utility subsidiary of CINergy; The Union Light and Power Co., The West Harrison Gas and Electric Co., Lawrenceburg Gas Co. and Miami Power Corp., utility subsidiaries of Applicant; Tri-State Improvement Co. and KO Transmission Co., subsidiaries of Applicant (Collectively hereinafter called "Participating Companies"), and to issue and acquire promissory notes in connection therewith, through May 31, 1997, pursuant to the terms and conditions as described in the Application and Exhibits. (8) The purpose of the Money Pool is to assist Applicant in least-cost financing of its interim capital requirements. (9) Under the terms of the Money Pool, short-term funds will be made available, from time to time, through May 31, 1997, to the Participating Companies other than CINergy from the following sources: (a) surplus funds from Participating Companies ("Internal Funds"), and (b) proceeds from bank borrowings by Participating Companies or the sale of commercial paper by CINergy, Applicant or PSI Energy for loan to the Money Pool ("External Funds"). The aggregate principal amount of Applicant's short-term indebtedness, including any borrowing from the Money Pool, will not exceed $400 million at any one time. (10) Interest rates applicable to loans made through the Money Pool will depend on whether the source of funds made available is derived from Internal Funds, External Funds or a combination thereof, as more fully described in the Application and Exhibits. (11) CINergy Services will administer the Money Pool on an "at cost" basis. CINergy Services is required to maintain separate records for the proposed Money Pool and any other money pool it administers. Participating Companies will have discretion to lend their surplus funds, if any, to or borrow moneys from the Money Pool, at any time. Participating Companies will not be required to borrow from the Money Pool, if it is determined that Participating Companies will be able to obtain funds at lower costs either through direct bank borrowing or through the issuance of their commercial paper. No loans will be made available to CINergy through the Money Pool. (12) The Money Pool is conditioned upon, among other things, the following: (a) Applicant or CINergy will not seek to overturn, reverse, set aside, change or enjoin, whether through appeal or the initiation and maintenance of any forum, a decision or Order of this Commission which pertains to recovery, disallowance, allowance, deferral, or ratemaking treatment of any expense, charge, cost, or allocation incurred or accrued by Applicant in or as a result of a contract, agreement, arrangement, or transaction with any affiliate, associate, holding, mutual service or subsidiary company on the basis that such expense, charge, cost, or allocation method was filed with or approved by the SEC, and (b) Applicant will continue to seek authorization from this Commission to issue short-term debt. (13) Participating Companies have filed Form U-1 Application-Declaration, as amended and restated, with the SEC, pursuant to the Public Utilities Holding Companies Act of 1935, as amended. (14) Based on the information contained in the Application, the exhibits thereto and other documentary information to which the Commission has access, the purposes to which the proceeds and other evidences of indebtedness shall be applied and the purposes to enter into and file at the SEC, a utility money pool contract, appear to be reasonably required for Applicant's lawful capital purposes and the Commission is satisfied that the consent and authority should be granted. It is, therefore, ORDERED, That The Cincinnati Gas & Electric Company is authorized, through June 30, 1996, to issue, and/or renew unsecured notes, including commercial paper, and other evidences of short-term indebtedness, maturing at periods of not more than twelve months, provided that Applicant's aggregate total outstanding short-term indebtedness, including the Statutory Exemption and any borrowing from Money Pool, does not exceed $400 million at any given time. It is, further, ORDERED, That Applicant is authorized to enter into and file at the Securities and Exchange Commission a utility Money Pool contract, and to issue and acquire promissory notes in connection therewith, through May 31, 1997, pursuant to the terms and conditions as described in the Application and Exhibits. It is, further, ORDERED, That the proceeds derived by the Applicant under the authority granted herein shall be applied for the purposes set forth in this Order or otherwise pursuant to Section 4905.401, Revised Code. It is, further, ORDERED, That after the Money Pool contract authorized by this Order is executed, Applicant shall file with this Commission a copy of the Money Pool Agreement, as executed. It is, further, ORDERED, That the authorization granted by this Order shall not be construed as limiting the Commission's determination of the appropriateness of Applicant's future long-term security offerings. It is, further, ORDERED, That nothing contained in this Order shall be construed to imply any guaranty or obligation as to the unsecured notes and other evidences of indebtedness, or the associated interest on the part of the State of Ohio. It is, further, ORDERED, That nothing contained 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 contained 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 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, Chairman /s/Jolynn Barry Butler /s/Richard M. Fanelly /s/Ronda Hartman Fergus /s/David W. Johnson Date: May 4, 1995 EX-14 5 EXHHIBIT 14 FINANCIAL STATEMENTS SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. FORM U-1 FILE NO. 70-8587 CINERGY SERVICES, INC. AS OF DECEMBER 31, 1994 (Unaudited) Pages 1 through 4
CINERGY SERVICES, INC. PRO FORMA STATEMENT OF INCOME TWELVE MONTHS ENDED DECEMBER 31, 1994 Pro Forma Actual Adjustments* Pro Forma (in thousands) OPERATING REVENUES . . . . . . . . . . $1 724 $ $ 1 724 OPERATING EXPENSES Other operation . . . . . . . . . . . 1 688 1 688 Taxes other than income taxes . . . . 36 36 1 724 1 724 OPERATING INCOME . . . . . . . . . . . $ $ $ * No adjustments are applicable.
CINERGY SERVICES, INC. PRO FORMA BALANCE SHEET AT DECEMBER 31, 1994 Pro Forma Actual Adjustments* Pro Forma (dollars in thousands) ASSETS CURRENT ASSETS Accounts receivable from associated companies . . . . . . . . . . . . . . . . . $749 $ $749 749 749 OTHER ASSETS. . . . . . . . . . . . . . . . . . 1 1 $750 $ $750 CAPITALIZATION AND LIABILITIES COMMON STOCK EQUITY Common stock - $.05 par value; authorized shares - 50; outstanding shares - 50 . . . . . . . . . . $ $ $ CURRENT LIABILITIES Accounts payable. . . . . . . . . . . . . . . 131 131 Accounts payable to associated companies . . . . . . . . . . . . . . . . . 619 619 750 750 $750 $ $750 * No adjustments are applicable.
CINERGY SERVICES, INC. Pro Forma Journal Entries* * No adjustments are applicable. FINANCIAL STATEMENTS SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. FORM U-1 FILE NO. 70-8587 THE CINCINNATI GAS & ELECTRIC COMPANY CONSOLIDATED AS OF DECEMBER 31, 1994 (Unaudited) Pages 1 through 6
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) 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 (479) 103 649 Taxes other than income taxes . . . . 197 381 197 381 1 496 849 (479) 1 496 370 OPERATING INCOME . . . . . . . . . . . 291 336 479 291 815 OTHER INCOME AND EXPENSES - NET Allowance for equity funds used during construction . . . . . . . . 1 971 1 971 Phase-in deferred return. . . . . . . 15 351 15 351 Other - net . . . . . . . . . . . . . (107) (107) 17 215 17 215 INCOME BEFORE INTEREST . . . . . . . . 308 551 479 309 030 INTEREST Interest on long-term debt. . . . . . 150 386 150 386 Other interest. . . . . . . . . . . . 2 831 1 367 4 198 Allowance for borrowed funds used during construction . . . . . . . . (2 977) (2 977) 150 240 1 367 151 607 NET INCOME . . . . . . . . . . . . . . 158 311 (888) 157 423 PREFERRED DIVIDEND REQUIREMENT . . . . 22 377 22 377 INCOME APPLICABLE TO COMMON STOCK. . . $ 135 934 $ (888) $ 135 046
THE CINCINNATI GAS & ELECTRIC COMPANY 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 . . . . . . . . . . . . . . . . $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 21 902 74 418 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 21 902 618 598 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 33 426 Other. . . . . . . . . . . . . . . . . . 55 987 55 987 Other. . . . . . . . . . . . . . . . . . . 40 436 40 436 789 325 21 902 789 325 $5 181 665 $21 902 $5 203 567
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 . . . . . . . . . . . . . . . 337 874 337 874 Retained earnings . . . . . . . . . . . . . . 432 962 (888) 432 074 Total common stock equity . . . . . . . . 1 532 972 (888) 1 532 084 CUMULATIVE PREFERRED STOCK Not subject to mandatory redemption . . . . . 80 000 80 000 Subject to mandatory redemption . . . . . . . 210 000 210 000 LONG-TERM DEBT . . . . . . . . . . . . . . . . 1 837 757 1 837 757 Total capitalization . . . . . . . . . . 3 660 729 (888) 3 659 841 CURRENT LIABILITIES Notes payable . . . . . . . . . . . . . . . . 14 500 22 790 37 290 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 22 790 450 318 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 $21 902 $5 203 567
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 (in thousands) BALANCE DECEMBER 31, 1993 . . . . . . . . . $ 456 511 $ $ 456 511 Net income . . . . . . . . . . . . . . . 158 311 (888) 157 423 Dividends on preferred stock. . . . . . . (22 377) (22 377) Dividends on common stock . . . . . . . . (158 970) (158 970) Other . . . . . . . . . . . . . . . . . . (513) (513) BALANCE DECEMBER 31, 1994 . . . . . . . . . $ 432 962 $(888) $ 432 074
THE CINCINNATI GAS & ELECTRIC COMPANY Pro Forma Consolidated Journal Entries to Give Effect to the Borrowing of Up to $38,300,000 from Banks Entry No. 1 Cash and temporary cash investments. . . $22,790,000 Notes payable . . . . . . . . . . . . . . . . . . . $22,790,000 To record the issuance of notes payable by The Union Light, Heat and Power Company, the West Harrison Gas and Electric Company, Lawrenceburg Gas Company and Miami Power Corporation net of $15,510,000 of notes, inter-company loans and open-account balances outstanding at December 31, 1994. Entry No. 2 Other interest . . . . . . . . . . . . . $1,367,400 Cash and temporary cash investments . . . . . . . . $1,367,400 To record interest on $22,790,000 of notes payable at 6%. Entry No. 3 Cash and temporary cash investments . . $478,590 Income taxes. . . . . . . . . . . . . . . . . . . . $478,590 To record the reduction in income taxes due to increased other interest costs ($1,367,400 at an assumed tax rate of 35%). FINANCIAL STATEMENTS SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. FORM U-1 FILE NO. 70-8587 KO TRANSMISSION COMPANY AS OF DECEMBER 31, 1994 (Unaudited) Pages 1 through 3
KO TRANSMISSION COMPANY PRO FORMA BALANCE SHEET AT DECEMBER 31, 1994* Pro Forma Actual Adjustments** Pro Forma ASSETS CURRENT ASSETS Accounts receivable from associated companies . . . . . . . . . . . . . . . . . $10 $ $10 CAPITALIZATION COMMON STOCK EQUITY Common stock - $1.00 par value; authorized shares - 100; outstanding shares - 10 . . . . . . . . . . $10 $ $10 * Ko Transmission will be used to acquire an interest in an interstate natural gas pipeline to which The Cincinnati Gas & Electric Company is entitled as a result of a settlement with the Columbia Gas Transmission Corp. ** No adjustments are applicable.
KO TRANSMISSION COMPANY Pro Forma Journal Entries* * No adjustments are applicable. FINANCIAL STATEMENTS SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. FORM U-1 FILE NO. 70-8587 TRI-STATE IMPROVEMENT COMPANY AS OF DECEMBER 31, 1994 (Unaudited) Pages 1 through 5
TRI-STATE IMPROVEMENT COMPANY PRO FORMA STATEMENT OF INCOME TWELVE MONTHS ENDED DECEMBER 31, 1994 Pro Forma Actual Adjustments* Pro Forma (in thousands) OTHER INCOME AND EXPENSES - NET Income taxes . . . . . . . . . . . . . . . . $ (53) $ $ (53) Other - net . . . . . . . . . . . . . . . . 295 295 242 242 INCOME BEFORE INTEREST . . . . . . . . . . . . 242 242 INTEREST Other interest . . . . . . . . . . . . . . . 1 252 1 252 Allowance for borrowed funds used during construction. . . . . . . . . . . . . . . . (1 102) (1 102) 150 150 NET INCOME . . . . . . . . . . . . . . . . . . $ 92 $ $ 92 * No adjustments are applicable.
TRI-STATE IMPROVEMENT COMPANY PRO FORMA BALANCE SHEET AT DECEMBER 31, 1994 Pro Forma Actual Adjustments* Pro Forma (dollars in thousands) ASSETS CURRENT ASSETS Cash. . . . . . . . . . . . . . . . . . . . . $ 56 $ $ 56 Accounts receivable . . . . . . . . . . . . . 66 66 Accounts receivable from associated companies - net . . . . . . . . . . . . . . 74 74 196 196 OTHER PROPERTY AND INVESTMENTS - NET. . . . . . 26 501 26 501 $26 697 $ $26 697 CAPITALIZATION AND LIABILITIES COMMON STOCK EQUITY Common stock - without par value; $25 stated value; authorized shares - 1,000; outstanding shares - 1,000 . . . . . $ 25 $ $ 25 Retained earnings/deficit . . . . . . . . . . (105) (105) Total common stock equity . . . . . . . . (80) (80) LONG-TERM DEBT Advances from associated companies. . . . . . 22 481 22 481 Total capitalization. . . . . . . . . . . 22 401 22 401 CURRENT LIABILITIES Accounts payable. . . . . . . . . . . . . . . 2 023 2 023 Accrued taxes . . . . . . . . . . . . . . . . 201 201 2 224 2 224 OTHER LIABILITIES Deferred income taxes . . . . . . . . . . . . 2 062 2 062 Other . . . . . . . . . . . . . . . . . . . . 10 10 2 072 2 072 $26 697 $ $26 697 * No adjustments are applicable.
TRI-STATE IMPROVEMENT COMPANY PRO FORMA STATEMENT OF CHANGES IN RETAINED EARNINGS/DEFICIT TWELVE MONTHS ENDED DECEMBER 31, 1994 Pro Forma Actual Adjustments* Pro Forma (in thousands) BALANCE DECEMBER 31, 1993 . . . . . . . . . $(197) $ $(197) Net income (loss) . . . . . . . . . . . . 92 92 BALANCE DECEMBER 31, 1994 . . . . . . . . . $(105) $ $(105) * No adjustments are applicable.
TRI-STATE IMPROVEMENT COMPANY Pro Forma Journal Entries* * No adjustments are applicable.
EX-27.2 6
OPUR1 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE BALANCE SHEETS AND STATEMENTS OF INCOME AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS 0000899652 CINERGY CORP. 2 CINERGY SERVICES, INC. 1,000 YEAR DEC-31-1994 JAN-01-1994 DEC-31-1994 PER-BOOK 0 0 749 0 1 750 0 0 0 0 0 0 0 0 0 0 0 0 0 0 750 750 1,724 0 1,724 1,724 0 0 0 0 0 0 0 0 0 0 0.00 0.00 EX-27.5 7
OPUR1 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE BALANCE SHEETS AND STATEMENTS OF INCOME AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS 0000899652 CINERGY CORP. 5 THE CINCINNATI GAS & ELECTRIC CO. (CONSOLIDATED) 1,000 YEAR 12-MOS DEC-31-1994 DEC-31-1994 JAN-01-1994 JAN-01-1994 DEC-31-1994 DEC-31-1994 PER-BOOK PRO-FORMA 3,795,644 3,795,644 0 0 596,696 618,598 748,889 748,889 40,436 40,436 5,181,665 5,203,567 762,136 762,136 337,874 337,874 432,962 432,074 1,532,972 1,532,084 210,000 210,000 80,000 80,000 1,837,757 1,837,757 14,500 37,290 0 0 0 0 0 0 0 0 0 0 0 0 1,506,436 1,506,436 5,181,665 5,203,567 1,788,185 1,788,185 104,128 103,649 1,392,721 1,392,721 1,496,849 1,496,370 291,336 291,815 17,215 17,215 308,551 309,030 150,240 151,607 158,311 157,423 22,377 22,377 135,934 135,046 158,970 158,970 150,386 150,386 0 0 0.00 0.00 0.00 0.00 EX-27.11 8
OPUR1 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE BALANCE SHEETS AND STATEMENTS OF INCOME AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS 0000899652 CINERGY CORP. 11 KO TRANSMISSION CO. 1 YEAR DEC-31-1994 JAN-01-1994 DEC-31-1994 PER-BOOK 0 0 10 0 0 10 10 0 0 10 0 0 0 0 0 0 0 0 0 0 0 10 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0.00 0.00 EX-27.12 9
OPUR1 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE BALANCE SHEETS AND STATEMENTS OF INCOME AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS 0000899652 CINERGY CORP. 12 TRI-STATE IMPROVEMENT CO. 1,000 YEAR DEC-31-1994 JAN-01-1994 DEC-31-1994 PER-BOOK 0 26,501 196 0 0 26,697 25 0 (105) (80) 0 0 22,481 0 0 0 0 0 0 0 4,296 26,697 0 0 0 0 0 242 242 150 92 0 92 0 0 0 0.00 0.00