As Filed With The Securities and Exchange Commission On January 19, 2001
Registration No. 333-______
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
----------------
VECTREN CORPORATION
(Exact Name of Registrant as Specified in its Charter)
Indiana 35-2086905
(State or Other Jurisdiction of (I.R.S. Employer Identification Number)
Incorporation or Organization)
----------------
20 N.W. Fourth Street
Evansville, Indiana 47741
(812) 491-4000
(Address, Including Zip Code, and Telephone Number,
Including Area Code, of Registrant's Principal Executive Offices)
----------------
Ronald E. Christian
Senior Vice President, General Counsel
and Secretary
20 N.W. Fourth Street
Evansville, Indiana 47741
(812) 491-4000
(Name, Address, Including Zip Code, and Telephone Number,
Including Area Code, of Agent For Service)
COPIES TO:
Catherine L. Bridge Edward F. Petrosky
Barnes & Thornburg Brown & Wood LLP
11 South Meridian Street One World Trade Center
Indianapolis, Indiana 46204 New York, New York 10048
(317) 236-1313 (212) 839-5300
<PAGE>
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As
soon as practicable after the effective date of this Registration Statement.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, please check the following box. / /
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier effective
registration statement for the same offering. / /
If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering. / /
If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. / /
-------------------------
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
Proposed maximum Proposed maximum
Title of each class of Amount to be offering price per aggregate offering Amount of
securities to be registered registered (1) unit (2) price registration fee
<S> <C> <C> <C> <C>
Common stock, no par value, and
common stock purchase rights (3) 6,325,000 $23.281 $147,252,325 $36,813.08
</TABLE>
(1) Includes 825,000 shares which the underwriters have the option to purchase
to cover over-allotments, if any.
(2) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(c) under the Securities Act of 1933, as amended, based
on the average of the high and low sales prices of the common stock of the
Registrant reported on the New York Stock Exchange on January 17, 2001.
(3) No additional consideration will be paid for the common stock purchase
rights.
The registrant hereby amends this registration statement on such date or dates
as may be necessary to delay its effective date until the registrant shall file
a further amendment which specifically states that this registration statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933, as amended, or until this registration statement shall
become effective on such date as the commission, acting pursuant to said Section
8(a), may determine.
<PAGE>
The information in this prospectus is not complete and may be changed. We may
not sell these securities until the registration statement filed with the
Securities and Exchange Commission is effective. This prospectus is not an offer
to sell these securities and we are not soliciting offers to buy these
securities in any jurisdiction where the offer or sale is not permitted.
[Note to Printer: legend to be printed in red on left-hand margin of front
cover]
<PAGE>
Subject to Completion
Preliminary Prospectus dated January 19, 2001
PROSPECTUS
----------
5,500,000 Shares
VECTREN CORPORATION
[LOGO]
Common Stock
(and Common Stock Purchase Rights)
----------------------
Vectren Corporation is selling 5,500,000 shares of common stock with
the related common stock purchase rights.
The shares trade on the New York Stock Exchange under the symbol "VVC."
On January 17, 2001, the last sale price of the shares as reported on the New
York Stock Exchange was $23.00 per share.
Investing in the common stock involves risks that are described in the
"Risk Factors" section beginning on page 6 of this prospectus.
----------------------
Per Share Total
Public offering price ....................... $ $
Underwriting discount ....................... $ $
Proceeds, before expenses, to Vectren ...... $ $
The underwriters may also purchase up to an additional 825,000 shares
from Vectren at the public offering price, less the underwriting discount,
within 30 days from the date of this prospectus to cover over-allotments.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
The shares will be ready for delivery on or about ___________, 2001.
----------------------
MERRILL LYNCH & CO. CREDIT SUISSE FIRST BOSTON
A.G. EDWARDS & SONS, INC.
EDWARD JONES & CO., L.P.
UBS WARBURG LLC
----------------------
The date of this prospectus is _____________, 2001.
<PAGE>
[graphic omitted]
VECTREN
Regulated Subsidiaries
Energy Delivery - Transmits and distributes natural gas and electricity
Power Supply - Generates and markets electric power
Non-Regulated Subsidiaries
Energy Services - Trades and markets natural gas and provides energy performance
contracting
Utility Services - Provides utility products and services, and the mining and
sale of coal
Communications - Provides integrated broadband communication services
Vectren Corporation is an energy and applied technology holding company
headquartered in Evansville, Indiana. Our operations began on March 31, 2000
through the combination of two Indiana-based companies, Indiana Energy, Inc. and
SIGCORP, Inc. On October 31, 2000, we acquired the natural gas distribution
assets of The Dayton Power and Light Company, located in western Ohio. Vectren's
regulated subsidiaries provide gas and/or electricity to approximately one
million customers in adjoining service territories that cover nearly two-thirds
of Indiana and 16 counties in west central Ohio, and generate and market
electric power. Vectren's non-regulated subsidiaries and affiliates primarily
consist of three business units providing services to customers throughout the
region: Energy Services, Utility Services and Communications. Our strategy is
focused on becoming the leading regional provider of energy and related applied
technology solutions to business, residential and municipal customers.
[graphic omitted]
[Graphic of several midwestern states, with Vectren's service area in Southern
and Central Indiana and Eastern Ohio highlighted.]
<PAGE>
TABLE OF CONTENTS
Page
Summary .................................................................... 4
Risk Factors ................................................................ 6
Forward-Looking Statements................................................... 8
Business .................................................................... 9
Use of Proceeds .............................................................19
Market Price of Common Stock and Dividends ..................................19
Capitalization ..............................................................21
Selected Historical and Pro Forma Consolidated Financial Data................22
Description of Stock ........................................................24
Certain United States Tax Considerations
for Non-United States Holders..............................................26
Underwriting.................................................................29
Legal Matters ...............................................................32
Experts ....................................................................32
Where You Can Find More Information .........................................32
----------------------
You should rely only on the information contained or incorporated by
reference in this prospectus. We have not, and the underwriters have not,
authorized anyone to provide you with different or additional information. If
anyone provides you with different or additional information, you should not
rely on it. We are not, and the underwriters are not, making an offer to sell
these securities in any jurisdiction where the offer is not permitted. You
should assume that the information contained in this prospectus is accurate only
as of the date on the cover page of this prospectus or, in the case of
information contained in documents incorporated by reference in this prospectus,
as of the date of those documents. Our business, financial condition, results of
operations and prospects may have changed since those dates.
----------------------
Unless otherwise indicated, all information contained in this
prospectus assumes that the underwriters' over-allotment option is not exercised
and the terms "Vectren," "we," "us" and "our" refer to Vectren Corporation and,
where appropriate, our subsidiaries.
----------------------
As used in this prospectus, the abbreviation "Mdth" means thousand
decatherms,"MMdth" means million decatherms, "MW" means megawatts, "MWhrs" means
megawatt hours, "RGUs" means revenue generating units and "throughput" means
combined gas sales and gas transportation volumes.
<PAGE>
SUMMARY
This summary provides an overview of the key aspects of the offering.
This summary is not complete and does not contain all of the information you
should consider before purchasing our common stock. You should read all of the
information contained or incorporated by reference in this prospectus carefully,
including the "Risk Factors" section and the financial statements and related
notes.
Our Company
Vectren Corporation is an energy and applied technology holding company
headquartered in Evansville, Indiana. Our operations began on March 31, 2000
through the combination of two Indiana-based companies, Indiana Energy, Inc. and
SIGCORP, Inc. On October 31, 2000, we acquired the natural gas distribution
assets of The Dayton Power and Light Company, located in western Ohio. Vectren's
regulated subsidiaries provide gas and/or electricity to approximately one
million customers in adjoining service territories that cover nearly two-thirds
of Indiana and 16 counties in west central Ohio, and generate and market
electric power. Vectren's non-regulated subsidiaries and affiliates primarily
consist of three business units providing services to customers throughout the
region: Energy Services, Utility Services and Communications. Energy Services
trades and markets natural gas and provides energy performance contracting
services. Utility Services provides utility products and services, such as
underground construction and facilities locating, meter reading and materials
management, and the mining and sale of coal. Communications provides integrated
broadband communications services, including local and long distance telephone,
internet access and cable television.
We segregate our businesses into regulated and non-regulated entities.
At September 30, 2000, we had $2.1 billion in total assets, with $1.7 billion
(80%) being regulated and $0.4 billion (20%) being non-regulated.
Our Strategy
Our strategy is focused on becoming the leading regional provider of
energy and related applied technology solutions to business, residential and
municipal customers. We believe strong customer relationships are key to our
success, and we will continue to build upon our strong utility foundation to
help make our customers more productive, comfortable and secure. More
specifically,
o We will build upon our strong utility foundation by remaining
a low cost, safe and reliable provider of energy and related
products and services.
o We will continue to build on the loyalty of existing and new
customers by anticipating and meeting their needs with
value-added products and services.
o We will grow our core business through the disciplined pursuit
of mergers, acquisitions, alliances, joint ventures and
partnerships.
o We will pursue superior returns for our shareholders through
our goal of providing, on average over five years, annual
earnings growth per share of 8% to 10%.
Vectren was incorporated under the laws of Indiana on June 10, 1999.
Our corporate offices are located at 20 N.W. Fourth Street, Evansville, Indiana
47741. Our telephone number is (812) 491-4000.
<PAGE>
The Offering
Common stock offered by Vectren.... 5,500,000 shares
Shares outstanding after
the offering....................... 66,887,468 shares
Use of proceeds.................... We estimate that our net proceeds
from this offering without exercise
of the underwriters' over-allotment
option will be approximately
$_________. We intend to use the
net proceeds to repay a portion of
the commercial paper issued to fund
the acquisition of the natural gas
distribution assets of The Dayton
Power and Light Company, our share
of the additional investment in
Reliant Services, LLC for the
purchase price for Miller Pipeline
Corporation, and our additional
investments in Haddington Energy
Partners and the integrated
broadband communications joint
venture with Utilicom Networks,
LLC.
Risk factors....................... See "Risk Factors" and other
information included or
incorporated by reference in this
prospectus for a discussion of
factors you should carefully
consider before deciding to invest
in shares of the common stock.
New York Stock Exchange symbol..... VVC
The number of shares outstanding after the offering is based on our
shares outstanding as of December 31, 2000 and excludes 859,441 shares reserved
for issuance under outstanding options. This number assumes that the
underwriters' over-allotment option is not exercised. If the over-allotment
option is exercised in full, we will issue and sell an additional 825,000
shares.
<PAGE>
RISK FACTORS
You should carefully consider the risk factors described below, as well
as the other information included or incorporated by reference in this
prospectus, before making an investment in our common stock. The risks and
uncertainties described below are not the only ones facing our company.
Additional risks and uncertainties not presently known or that we currently
believe to be immaterial may also adversely affect us.
Our acquisitions may not perform as expected.
We have achieved growth through mergers and acquisitions and expect
that we will continue to grow, in part, through acquisitions. Although each of
the acquired businesses had a significant operating history at the time we
acquired it, we have a limited history of owning and operating many of these
businesses. There can be no assurances that these businesses will perform as
expected, that the returns from these businesses will support the indebtedness
incurred to acquire them or the capital expenditures needed to maintain or
develop them or that we will realize the synergies associated with our merger
and investment strategies.
We operate in an increasingly competitive industry, which may affect our future
earnings.
The utility industry has been undergoing dramatic structural change for
several years, resulting in increasing competitive pressures faced by electric
and gas utility companies. Increased competition may create greater risks to the
stability of utility earnings generally and may in the future reduce our
earnings from retail electric and gas sales. Currently, several states,
including Ohio, have passed legislation that allows electricity customers to
choose their electricity supplier in a competitive electricity market, and
several other states are considering such legislation. At the present time,
Indiana has not adopted such legislation. Ohio regulation provides for choice of
commodity for all gas customers. We plan to implement this choice for all of our
gas customers in Ohio by 2002. Indiana has not adopted any regulation requiring
gas choice except for large volume customers. We cannot assure that increased
competition or other changes in legislation, regulation or policies will not
have a material adverse effect on our business, prospects, financial condition
or results of operations.
From time to time, we are subject to material litigation and regulatory
proceedings.
On November 3, 1999, the United States Environmental Protection Agency
("USEPA") filed a lawsuit against Southern Indiana Gas and Electric Company
("SIGECO"), a wholly owned subsidiary of Vectren, alleging violations of the
Clean Air Act at the Culley Generating Station. The lawsuit seeks fines against
SIGECO for as much as $27,500 per day per violation without specifying the
number of days or violations that the USEPA believes occurred. The USEPA also
seeks an order requiring SIGECO to install the best available emission
technology at the Culley Generating Station, the costs of which are estimated to
be $40 million to $50 million. The majority of these costs are included in the
approximately $160 million which SIGECO would be required to expend if the
USEPA's rule requiring certain states, including Indiana, to file revised state
implementation plans to reduce nitrogen oxide ("NOx"), a key ingredient of
ozone, emissions is upheld by a final court order and, as a result, SIGECO is
required to install system-wide NOx emission control. The estimate is based on
the level of system-wide emissions reductions ultimately required and the
control technology utilized to achieve the reductions and is expected to be
expended during the 2001-2004 period. Related additional operation and
maintenance expenses could be an estimated $8 to $10 million annually.
The Indiana Utility Regulatory Commission (the "Indiana Commission")
has determined that there should be additional review of certain pricing terms
for the purchase of gas by Indiana Gas Company, Inc., a wholly owned subsidiary
of Vectren ("Indiana Gas"), from ProLiance Energy, LLC ("ProLiance"), our 50%
owned unregulated marketing affiliate, in a pending gas cost adjustment
proceeding before the Indiana Commission involving Indiana Gas and Citizens Gas
& Coke Utility, a public charitable trust that provides gas service to the City
of Indianapolis ("Citizens Gas"). An affiliate of Citizens Gas is our partner in
the ProLiance joint venture. A hearing schedule has not yet been established.
Pending resolution of these issues, Indiana Gas continues to record gas costs in
accordance with the ProLiance contract and Vectren continues to record its
proportional share of ProLiance's earnings.
In addition to the matters described above, we may be subject to other
material litigation and regulatory proceedings from time to time. There can be
no assurance that the outcome of these matters will not have a material adverse
effect on our consolidated financial condition or results of operations.
We may not be able to realize our communications strategy.
Since we have a minority interest in our investments in Utilicom
Networks, LLC ("Utilicom"), the nature of our broadband communications
investments and the manner in which we offer such services to customers may
change. Further, we face strong competition in the broadband communications
business. Competitors include regional, national and global companies. Many of
our competitors are well-established and have larger and better developed
networks and systems, greater name recognition, longer operating histories in
certain businesses and significantly greater financial, technical and marketing
resources. As a result, there can be no assurance that we will achieve
penetration rates in Indianapolis, Indiana, Dayton, Ohio or any other future
markets comparable to the rates achieved by SIGECOM, LLC ("SIGECOM") in the
Evansville, Indiana market.
<PAGE>
FORWARD-LOOKING STATEMENTS
Statements contained or incorporated by reference in this prospectus
regarding future events and developments are "forward-looking statements" within
the meaning of Section 27A of the Securities Act of 1933. Forward-looking
statements are based on management's beliefs as well as assumptions made by, and
information currently available to, management. Because such statements are
based on expectations and not historical facts, actual results may differ
materially from those projected in the particular statements. Important factors
that could cause future results to differ include those listed under "Risk
Factors" and the following:
o Weather conditions;
o The federal and state regulatory environment, including
changes in rate-setting and cost-recovery policies,
environmental regulations, tax or accounting matters and other
laws and regulations to which we are subject;
o The economic climate, including inflation rates and monetary
policies;
o Unusual or unanticipated changes in normal business
operations, including unusual maintenance or repairs;
o Fluctuation in supply, demand, transmission capacity and
prices for energy commodities;
o Customer growth within our service territories and changes in
customers' usage patterns and energy preferences;
o Financial market conditions, including changes in availability
of capital or interest rate fluctuations;
o Our ability to carry out our marketing and sales plans, along
with the ability to realize synergies associated with our
merger and investment strategies; and
o Employee workforce factors, including changes in collective
bargaining unit agreements, strikes or work stoppages.
These and other matters are difficult to predict, and many are beyond
our control, including those we discuss in this prospectus and our filings with
the Securities and Exchange Commission. Accordingly, you should not rely on the
accuracy of predictions contained in forward-looking statements. These
statements speak only as of the date of this prospectus or, in the case of
documents incorporated by reference, as of the date of those documents.
<PAGE>
BUSINESS
[graphic omitted]
VECTREN
Regulated Subsidiaries
Energy Delivery - Transmits and distributes natural gas and electricity
Power Supply - Generates and markets electric power
Non-Regulated Subsidiaries
Energy Services - Trades and markets natural gas and provides energy performance
contracting
Utility Services - Provides utility products and services, and the mining and
sale of coal
Communications - Provides integrated broadband communication services
Vectren Corporation is an energy and applied technology holding company
headquartered in Evansville, Indiana. Our operations began on March 31, 2000
through the combination of two Indiana-based companies, Indiana Energy, Inc.
("Indiana Energy") and SIGCORP, Inc. ("SIGCORP"). On October 31, 2000, we
acquired the natural gas distribution assets of The Dayton Power and Light
Company ("Dayton Power"), located in western Ohio, which are now operated by
Vectren Energy Delivery of Ohio, Inc. ("Vectren of Ohio"), a wholly-owned
subsidiary. Vectren's regulated subsidiaries provide gas and/or electricity to
approximately one million customers in adjoining service territories that cover
nearly two-thirds of Indiana and 16 counties in west central Ohio, and generate
and market electric power. Vectren's non-regulated subsidiaries and affiliates
primarily consist of three business units providing services to customers
throughout the region: Energy Services, Utility Services and Communications.
Energy Services trades and markets natural gas and provides energy performance
contracting. Utility Services provides utility products and services, such as
underground construction and facilities locating, meter reading and materials
management, and the mining and sale of coal. Communications provides integrated
broadband communications services, including local and long distance telephone,
internet access and cable television.
We segregate our businesses into regulated and non-regulated
entities. At September 30, 2000, we had $2.1 billion in total assets, with $1.7
billion (80%) being regulated and $0.4 billion (20%) being non-regulated. For
the twelve months ended September 30, 2000, we had $72.6 million (76%) in
earnings from our regulated entities and $23.1 million (24%) in earnings from
our non-regulated entities.
[graphic omitted]
Regulated vs. Non-Regulated
Total Assets* (9/30/00)
$2.1 billion
Regulated 80%
Non-Regulated 20%
*Does not include Vectren of Ohio
Earnings*
Twelve Months Ended 9/30/00
$95.7 million
Regulated 76%
Non-Regulated 24%
*Before merger costs and does not include Vectren of Ohio
Our Strategy
Our strategy is focused on becoming the leading regional provider of
energy and related applied technology solutions to business, residential and
municipal customers. We believe strong customer relationships are key to our
success, and we will continue to build upon our strong utility foundation to
help make our customers more productive, comfortable and secure.
We will build upon our strong utility foundation by remaining a low
cost, safe and reliable provider of energy and related products and services.
Our strong utility foundation is built upon low cost electric generating and
energy distribution assets. We have aligned our business groups and have formed
strategic alliances and partnerships to utilize our core competencies, reduce
costs and better manage our operations.
We will continue to build on the loyalty of existing and new customers
by anticipating and meeting their needs with value-added products and services.
Customer-care is a primary focus, and we have implemented a customer care
organization, including marketing and sales and a centralized call center in
Evansville. This helps position us to provide future products and services.
We will grow our core business through the disciplined pursuit of
mergers, acquisitions, alliances, joint ventures and partnerships. Most
recently, we successfully completed the merger of Indiana Energy and SIGCORP to
form Vectren, acquired the natural gas assets of Dayton Power and acquired,
through a joint venture, Miller Pipeline Corporation ("Miller Pipeline"). We
will opportunistically pursue other businesses where we have developed
expertise. We will also look to divest certain businesses judged to be non-core
to Vectren's customer relationship focused strategy.
We will pursue superior returns for our shareholders. It is our goal to
produce, on average over five years, annual earnings growth per share of 8% to
10%. Our goal is to grow regulated earnings on average up to 4%. Furthermore,
our goal is for non-regulated operations, which contribute approximately 24% of
consolidated earnings, to contribute as much as 35% in five years. We plan to
continue to grow our cash dividend and maintain investment grade credit ratings
for our debt.
Our Competitive Strengths
We believe we have developed competitive strengths that will enable us to
successfully execute our strategy. These strengths include:
o Customer focus
o Superior service
o Experienced management team
o Solid, cost conscious utility foundation
o Low cost provider of electric generation
o Successful non-regulated growth strategy
o Market leading supplier of gas to industrial customers and
municipal utilities
o Disciplined approach to growth through business combinations
o Outstanding dividend record
Regulated Business Segment Review
[graphic omitted]
Gas vs. Electric
(Twelve Months Ended 9/30/00)
Gas-Revenues*
Residential 62%
Commercial 21%
Industrial 9%
Other 8%
*Does not include Vectren of Ohio
Electric - Revenues
Residential 28%
Industrial 26%
Commercial 22%
Wholesale 22%
Other 2%
Earnings*
Gas 51%
Electric 49%
*Before merger costs and does not include Vectren of Ohio
Energy Delivery
With the addition of the Vectren of Ohio operations, which were
acquired on October 31, 2000, our Energy Delivery group provides natural gas and
electric service to approximately one million customers in Indiana and west
central Ohio. Through Energy Delivery, we strive to remain a safe, reliable, low
cost provider of energy to our customers helping to make them more productive,
comfortable and secure.
Energy Delivery is made up of three utility companies. SIGECO currently
markets and delivers electricity and natural gas to approximately 150,000
customers in southwestern Indiana. Indiana Gas provides natural gas distribution
to approximately 510,000 customers in central Indiana. Vectren of Ohio provides
natural gas distribution to approximately 305,000 customers in west central
Ohio. Indiana Gas, SIGECO and Vectren of Ohio are wholly owned subsidiaries of
Vectren.
<PAGE>
[graphic omitted]
Gas Throughput and Customers
1998 1999 2000*
Gas throughput MDth (000's) 139 151 151
Heating Degree Days - % of Normal 80 87 85
*Does not include Vectren of Ohio
*Twelve months 9/30/00
1998 1999 2000*
Natural Gas Customers (000's) 598 611 621
Does not include Vectren of Ohio
*As of 9/30/00
Gas volumes steadily increased in recent years as measured by
throughput. Throughput in 2000 was 151 MMdth compared to 151 MMdth in 1999 and
139 MMdth in 1998. Customer counts were approximately 621,000 in 2000, 611,000
in 1999 and 598,000 in 1998. Growth in gas throughput was impacted by weather,
favorable economic conditions and customer growth.
[graphic omitted]
Electric Sales and Customers
1998 1999 2000*
Electric Sales - Mwh (000's) 6,859 6,941 7,091
Cooling Degree Days - % of Normal 120% 91% 90%
*Twelve months ended 9/30/00
1998 1999 2000*
Electric Customers (000's) 123 125 127
*As of 9/30/00
Electric sales totaled approximately 7,091,000 MWhrs in 2000, 6,941,000
MWhrs in 1999 and 6,859,000 MWhrs in 1998. Electric customer counts were
approximately 128,000 in 2000, 125,000 in 1999 and 123,000 in 1998. Electric
sales grew despite milder than normal weather, as measured in terms of cooling
degree days. These results reflect customer growth and our successful efforts to
market our low cost excess generating capacity to wholesale customers.
Energy Delivery Strategic Objectives
o Be a top quartile performer in the industry in terms of
customer service, safety, operating costs and prices
o Enhance customer relationships to serve as a foundation for
providing additional products and services
o Continually improve through process revisions and development
of new technology
Power Supply
Our Power Supply group operates and maintains Vectren's six coal fired
electric power plants and five peaking units in southwest Indiana and contracts
for purchased power and sells power in the wholesale market. We presently own
1,256 MWs of installed operating generating capacity. Coal-fired generating
units provide 1,041 MWs of capacity, and gas or oil-fired turbines used for
peaking or emergency conditions provide 215 MWs. We have 50 MWs available under
firm contracts and 120 MWs available under interruptible contracts. We also have
80 MWs under development, which will be fueled by natural gas.
[graphic omitted]
(Left Graph)
Firm Capacity (1,306 MWs)
Coal 80%
Oil & Gas 16%
Purchased Power 4%
(Right Graph)
Source of Supply in 2000 (MWhrs)
Coal 87%
Purchased Power 12%
Oil & Gas 1%
In addition, our Power Supply group has interconnections with
Louisville Gas and Electric Company, Cinergy Services, Inc., Indianapolis Power
& Light Company, Hoosier Energy Rural Electric Cooperative, Inc., Big Rivers
Electric Corporation, Wabash Valley Power Association and the City of Jasper,
providing an ability to simultaneously interchange approximately 750 MWs.
We believe that a distinct competitive advantage of our Power Supply
group is the low cost generation of electric power made possible through low
production costs. Our power production costs, which include coal costs, in 1999
were approximately 1.75 cents per kilowatt hour, placing us among the lowest
cost providers in the nation, as demonstrated by the following graph:
[graphic omitted]
Electric Cost of Production (1)
1999
SIGECO ECAR Average National Average
Cents per KWh 1.75 1.93 1.86
(1) Electric Cost of Production is defined as total fuel cost and non-fuel
operation and maintenance cost
Source: Resource Data International, Inc.
This advantage allows us to make sales into the public power markets.
While we must first serve our Energy Delivery group, excess power has been
available for sale to other buyers during non-peak load periods. Low production
costs enable us to sell a greater volume of power at favorable market prices.
Power Supply Strategic Objectives
o Maximize return on generation assets
o Maintain position as a low cost, reliable producer of electric
power
o Operate in a manner that reflects Vectren's commitment to
environmental stewardship.
Non-Regulated Business Segment Review
Energy Services
Our Energy Services group relies heavily upon a customer focused, value
added strategy. The group provides gas marketing and fuel supply management to
over 600 customers in twelve states across the Midwest, as well as market
intelligence through disciplined trading. In addition to being a leading
provider of these services to municipal utilities, we serve large end users and
other utilities. This group is also the gas supplier for our Energy Delivery
group. At year-end 2000, Energy Services had 616 customers, up from 377 in 1998.
Volume has grown about 38%, with customer growth as volumes traded increased to
336 MMdth in 2000, up from 244 MMdth in 1998.
[graphic omitted]
(Left Graph)
1998 1999 2000*
Customers 377 472 616
*2000 Projected
(Right Graph)
1998 1999 2000*
Throughput Volumes in Mdth (000's) 244 287 336
*2000 Projected
The Energy Services group includes two gas marketing companies.
ProLiance is 50% owned by Vectren and 50% owned by an affiliate of Citizens Gas.
SIGCORP Energy Services, Inc. is a wholly owned subsidiary of Vectren. In
addition, Energy Services Group, LLC provides energy performance contracting
facility upgrades through its design and installation of energy-efficient
equipment. Energy Systems Group, LLC is a venture between Vectren and Citizens
Gas, with Vectren owning 67%.
Energy Services Strategic Objectives
o Deploy a customer relationship strategy
o Continue to build natural gas marketed volumes
o Develop a platform to sell power to end users and municipal
customers
Utility Services
Our Utility Services group is a low cost provider of outsourcing
services for electric, gas, water and telecommunication utilities, including
Vectren's Energy Delivery businesses. Those outsourced services include
underground construction and facilities locating, meter reading, warehousing and
distribution of materials and third party collections. In addition, the group
provides Vectren's Power Supply group with a dependable, low cost source of coal
from its own mines in southwest Indiana. It also markets coal to other utilities
and wholesale customers.
This group includes the following entities: Reliant Services, LLC, an
equally owned strategic alliance with Cinergy Corp. ("Reliant"); CIGMA, LLC, an
equally owned strategic alliance with an affiliate of Citizens Gas; IEI
Financial Services, LLC, a wholly owned subsidiary of Vectren; and Vectren
Fuels, Inc., a wholly owned subsidiary of Vectren.
Utility Services Strategic Objectives
o Continue to optimize core competencies and expand service
offerings to other utilities
o Provide improved service and reduced costs to utility
affiliates
Communications
Our Communications group provides services to approximately 23,000
residential and commercial customers in the greater Evansville area in southern
Indiana through an 880-mile fiber network. This network has been active since
mid-2000. The present customer base has yielded approximately 52,400 RGUs,
indicating multiple lines and/or services being utilized by the same customer.
Penetration of our existing energy customer base in Evansville with
communications services has been in excess of one-third. The Evansville system
is operated in a joint venture with Utilicom. Utilicom is a provider of bundled
communications services that focuses on last mile delivery to residential and
commercial customers in second and third tier markets.
[graphic omitted]
1999 2000
Communications Customers
Total Passing 43,100 83,400
Customers Served 11,150 23,000
RGUs 18,000 52,400
Our Communications strategy is to be the first mover to connect
customers in the second and third tier markets in Indiana and west central Ohio.
We intend to execute our strategy by investing in broadband cable overbuilds and
by optimizing the existing relationships between our other business groups and
their customers.
In addition to the operating Evansville network, we have invested $8.1
million in Utilicom and have also committed to invest up to $100 million in
Utilicom in the form of convertible subordinated debt, subject to obtaining all
required financing. Vectren's commitment will support Utilicom's plan to raise
$600 million of additional capital to fund ventures in Indianapolis, Indiana and
Dayton, Ohio. Utilicom has also obtained $220 million of capital commitments
from Blackstone Capital Partners III, First Union Capital Partners, and JP
Morgan Capital. These commitments are also subject to the achievement of the
funding of the entire $600 million of additional capital.
Communications Strategic Objectives
o Generate positive EBITDA from the Evansville investment in
2001
o Begin construction of broadband strategy in Indianapolis and
Dayton
Corporate and Other
In addition to the non-regulated business groups previously discussed,
our Corporate and Other group invests in and realizes tax credits from:
o a portfolio of energy development projects in gas storage,
gathering and processing, and fuel cells and other distributed
generation projects;
o real estate, including structured finance and leveraged
leases, as well as low income housing projects;
o projects to develop coal based synthetic fuels; and
o corporate information technology, including billing and
financial reporting systems.
Major investments include Haddington Energy Partners, L.P. ("Haddington
Energy"), Southern Indiana Properties, Inc., Pace Carbon Synfuels Investors,
L.P., Energy Realty, Inc. and Vectren Resources LLC.
Recent Developments
Acquisition of the Gas Utility Assets of The Dayton Power and Light Company
Vectren purchased the natural gas distribution assets of Dayton Power
for a purchase price of approximately $465 million on October 31, 2000. The
acquisition added approximately 305,000 gas utility customers in 16 counties in
western Ohio. Vectren acquired the gas utility assets as a tenancy in common
through two separate subsidiaries. Indiana Gas acquired a 47% undivided
ownership interest in the assets and Vectren of Ohio acquired the remaining 53%
undivided ownership interest. Vectren of Ohio is the operator of all of the
assets. Because Ohio law requires domestic incorporation of any entity providing
utility services in Ohio, Indiana Gas has incorporated under Ohio, as well as
Indiana, law.
Vectren Utility Holdings, Inc. ("Utility Holdings") is the intermediate
holding company for Vectren's utility interests. As part of the acquisition
financing, Utility Holdings borrowed approximately $435 million under its
commercial paper program. From the proceeds of this financing, Indiana Gas
borrowed $189 million and Vectren of Ohio borrowed $246 million from Utility
Holdings. Indiana Gas also borrowed $29 million under its commercial paper
program. Indiana Gas and Vectren of Ohio each applied these proceeds to pay its
respective share of the purchase price for the gas utility assets of Dayton
Power. On December 28, 2000, Utility Holdings issued $150 million in floating
rate notes due December 27, 2001 and applied the net proceeds to reduce the
balance outstanding under its commercial paper program. These notes bear
interest at a floating annual rate equal to the three month U.S. dollar LIBOR
rate plus .75%. Concurrently with completion of this financing, a floating rate
to fixed rate swap was executed which in effect resulted in a fixed rate of
6.64% on this debt. We anticipate that the related commercial paper and
short-term financings will be replaced over time with permanent, long term
financing.
Additional Investment in Utilicom
On December 21, 2000, Vectren invested $8.1 million in Utilicom. Vectren
has also committed to invest up to $100 million in Utilicom in the form of
convertible subordinated debt, subject to obtaining all required financing.
Vectren is a current partner in Utilicom's initial operation in Evansville,
Indiana, operating under the brand name of SIGECOM, a TOTALink affiliate.
Utilicom, operating under the brand name TOTALink, is a provider of bundled
communications services, focusing on last mile delivery to residential and
commercial customers in second and third tier markets. It builds, owns and
operates high capacity broadband networks and delivers cable TV, high speed
internet service and telephone service to customers in partnership with
affiliates of local electric and gas utilities.
Vectren's commitment will support the plan of Utilicom to raise $600
million of additional capital to fund ventures in Indianapolis, Indiana and
Dayton, Ohio, where Utilicom has recently received authorization to build and
operate networks, and to recapitalize the SIGECOM venture. Utilicom has also
obtained $220 million of capital commitments from Blackstone Capital Partners
III, First Union Capital Partners, and JP Morgan Capital. These commitments are
also subject to the funding of the entire $600 million of additional capital.
A launch date of late 2001 is expected for both the Indianapolis and
Dayton projects. The Indianapolis venture, TOTALink of Indiana, LLC, will
consist of approximately 3,400 miles of broadband network passing 350,000 homes
and businesses. The Dayton venture, TOTALink of Ohio LLC, will consist of
approximately 1,100 miles of broadband network passing 120,000 homes and
businesses.
Vectren has a 14% equity interest in SIGECOM following the
recapitalization of Utilicom in January 2000. Upon completion of all new funding
and later conversion of convertible debt, Vectren would have up to a 31%
ownership in both the Indianapolis and Dayton ventures and would own
approximately 8% of Utilicom. With the $8.1 million investment, Vectren has now
invested $25 million in Utilicom as convertible subordinated debt and $8 million
as equity in SIGECOM Holdings, Inc. Vectren does not expect the Indianapolis and
Dayton investments to have any significant financial impact on earnings in 2001
or 2002. Construction in Indianapolis and Dayton will be funded over the next
five years.
Acquisition of Miller Pipeline Corporation
On December 13, 2000, Reliant, a joint venture equally owned by
subsidiaries of Cinergy Corp. and Vectren, purchased the stock of
Indianapolis-based Miller Pipeline from NiSource Inc. for approximately $68.3
million. Miller Pipeline is one of the nation's premier natural gas distribution
contractors with nearly 50 years of experience in the construction industry. The
acquisition will expand our utility services business by adding underground
pipeline construction, replacement and repair to our current services of
underground facility locating, contract meter reading and installation of
telecommunications and electric facilities.
Increased Gas Costs and Gas Cost Adjustment Proceedings
Commodity prices for natural gas purchases during the winter months of
calendar year 2001 have unexpectedly increased significantly, primarily due to
the expectation of a colder winter, which has led to increased demand and
tighter supplies. Subject to regulatory approval, Vectren's utility subsidiaries
charge their customers the actual cost they pay for the natural gas purchased on
their customers' behalf. As a result, profit margins on gas sales should not be
impacted. In 2001, Vectren's utility subsidiaries may experience higher working
capital requirements, increased expenses, including interest costs and
uncollectibles, and possibly some level of price sensitive reduction in volumes
sold. To the extent significantly increased prices are accompanied by colder
than normal weather, higher volumes may be sold, providing increased margins as
an offset to the unfavorable results mentioned above.
On October 11, 2000, Indiana Gas filed for approval of its quarterly
gas cost adjustment. In early December, the Indiana Commission issued an interim
order approving the request by Indiana Gas for a gas cost adjustment factor for
December 2000. On January 4, 2001, the Indiana Commission approved the January
and February 2001 gas cost adjustment as filed. The order also addressed the
claim by the Office of Utility Consumer Counselor that a portion of the
requested gas cost adjustment be disallowed because Indiana Gas should have
entered into additional commitments for this winter's gas supply in late 1999
and early 2000. In procuring gas supply for this winter, Indiana Gas followed
the practices that it had employed in the past and which were subject to review
by the Indiana Commission. In response to the claim by the Office of Utility
Consumer Counselor, the Indiana Commission found that there should be a
one-time, $3.8 million disallowance related to gas procurement for this winter
season. As a result, Indiana Gas expects to recognize a pre-tax charge of $3.8
million during fiscal year 2000. Indiana Gas or the Office of Utility Consumer
Counselor could file appeals to the Indiana Commission's order through February
4, 2001. To date, no appeals have been filed.
USE OF PROCEEDS
We estimate that we will receive net proceeds from this offering
without exercise of the underwriters' over-allotment option of approximately
$____ million ($_____ million if the underwriters' over-allotment option is
exercised in full), after deducting the underwriting discount and commissions
and estimated offering expenses payable by us. We intend to use the net proceeds
to repay a portion of the commercial paper of Utility Holdings outstanding as of
December 31, 2000, which has a weighted average interest rate of 6.8% per annum
as of January 18, 2001 and has maturities ranging from 1 day to 60 days. We
issued the commercial paper to fund the acquisition of the natural gas
distribution assets of Dayton Power, our share of the additional investment in
Reliant for the purchase price for Miller Pipeline and our additional
investments in Haddington Energy and the integrated broadband communications
joint venture with Utilicom.
MARKET PRICE OF COMMON STOCK AND DIVIDENDS
Our shares of common stock are traded on the New York Stock Exchange
under the symbol "VVC." The high and low sales prices for our common stock as
reported on the New York Stock Exchange composite transactions reporting system
and dividends paid are shown in the following table for the periods indicated.
Quarterly Cash Price Range
Dividends High Low
-------------- ---- ---
2000:
Second Quarter $0.2425 $21.3125 $15.7500
Third Quarter 0.2425 20.3750 17.5625
Fourth Quarter 0.2550 26.5000 20.0000
2001:
First Quarter
(through January 5) (1) $24.1875 $22.0625
-----------------------
(1) A dividend has not been declared or paid for the first fiscal quarter
of 2001.
The last reported sale price of our common stock on the New York Stock
Exchange on January 17, 2001 was $23.000 per share, and, as of January 12, 2001,
there were 14,904 shareholders of record of common stock.
Additional dividends for fiscal 2001 have not been declared and
dividends on our shares of common stock are payable at the discretion of our
board of directors out of legally available funds. Future payments of dividends,
and the amounts of these dividends, will depend on our financial condition,
results of operations, capital requirements and other factors.
The mortgage indenture and the terms of preferred stock of SIGECO
contained in its articles of incorporation could limit the ability of SIGECO to
pay dividends to Vectren. Under the applicable provisions, SIGECO may pay
dividends on common stock from accumulated surplus earned subsequent to 1947 to
the extent this surplus exceeds two times the annual dividend requirements on
preferred stock. The amount restricted against cash dividends on common stock at
September 30, 2000 under the restriction was $1,926,000 leaving $249,930,000
unrestricted for the payment of dividends.
<PAGE>
CAPITALIZATION
The following table sets forth our capitalization as of September 30,
2000:
o on an actual basis;
o on a pro forma basis to reflect the acquisition of the natural gas
distribution assets of Dayton Power for a purchase price of
approximately $465 million, the issuance by Indiana Gas on
December 28, 2000 of $70,000,000 in insured quarterly notes in an
underwritten public offering, and the issuance by Vectren Capital,
Corp. ("Vectren Capital") on December 21, 2000 of $78,000,000 in
senior notes in a private placement with institutional investors;
and
o on an adjusted basis, which gives effect to the sale of 5,500,000
shares in this offering at a public offering price of $23.00,
after deducting the underwriting discount and commissions and
estimated offering expenses payable by us, and application of the
net proceeds of $120,934,000 to repay outstanding commercial
paper, as if the issuance occurred on September 30, 2000.
You should read this table in conjunction with the consolidated financial
statements and related notes included or incorporated by reference in this
prospectus.
<TABLE>
<CAPTION>
As of September 30, 2000
------------------------
(In thousands)
Actual Pro Forma Pro Forma
------ --------- As Adjusted (1)
-----------
Short-term debt
<S> <C> <C> <C>
Current maturities of long term debt $ 258 $ 258 $ 258
Other short-term borrowings 364,245 680,246 559,312
------- ------- -------
Total short term-debt 364,503 680,504 559,570
------- ------- -------
Long-term debt and other obligations 484,074 632,074 632,074
------- ------- -------
Shareholders equity:
Preferred stock of subsidiary 16,965 16,965 16,965
Common stock (no par value) 213,742 213,742 334,676
480,000 shares authorized;
61,219 shares issued and outstanding
Retained earnings 495,886 495,886 495,886
Accumulated other comprehensive income 74 74 74
------- ------- -------
Total common
shareholders' equity 709,702 709,702 830,636
------- ------- -------
Total capitalization $1,575,244 $2,039,245 $2,039,245
========== ========== ==========
</TABLE>
(1) The "As Adjusted" column does not include up to 825,000 shares of our
common stock issuable upon the exercise of the underwriters'
over-allotment option.
<PAGE>
SELECTED HISTORICAL AND PRO FORMA
CONSOLIDATED FINANCIAL DATA
Selected Historical Financial Information
The following table presents selected financial data for our fiscal
years 1995, 1996, 1997, 1998 and 1999 and for the 12 months ended September 30,
2000, and should be read in conjunction with the consolidated financial
statements of Vectren incorporated by reference in this prospectus. This
information has been restated to reflect the pooling of interests transaction
pursuant to which each of Indiana Energy and SIGCORP merged into Vectren.
<TABLE>
<CAPTION>
Twelve Months
Year Ended December 31 Ended Sept. 30
------------------------------------------------------------------------------------
1995 1996 1997 1998 1999 2000
---- ---- ---- ---- ---- ----
(in thousands, except per share data) (unaudited)
Operating Data
<S> <C> <C> <C> <C> <C> <C>
Operating revenue $805,828 $965,335 $972,081 $997,706 $1,068,417 $1,249,957
Operating income $126,650 $159,897 $124,556 (1) $148,537 $160,772 $117,937 (2)
Net income $85,994 $83,657 $67,714 (1) $86,600 $90,748 $68,091 (2)
Average common shares 61,567 61,522 61,611 61,578 61,306 61,269
outstanding
Basic earnings per share on $1.40 $1.36 $1.10 (1) $1.41 $1.48 $1.11 (2)
common stock
Diluted earnings per share $1.40 $1.36 $1.10 $1.41 $1.48 $1.11
on common stock
Dividends per share on $0.83 $0.85 $0.88 $0.90 $0.94 $0.96
common stock
As of December 31, As of Sept. 30
------------------------------------------------------------------------------------
1995 1996 1997 1998 1999 2000
---- ---- ---- ---- ---- ----
(in thousands, except per share data) (unaudited)
Balance Sheet Data
Total assets $1,673,310 $1,719,547 $1,758,634 $1,798,840 $1,980,467 $2,072,968
Redeemable preferred stock $8,424 $8,424 $8,424 $8,308 $8,192 $8,076
Long-term obligations $460,379 $409,058 $475,490 $388,938 $486,726 $484,074
Common stock equity $607,967 $639,067 $653,666 $677,914 $709,757 $709,702
</TABLE>
(1) During 1997, the Indiana Gas Board of Directors authorized
management to undertake the actions necessary and appropriate to restructure
Indiana Gas' operations and recognize a resulting restructuring charge of $39.5
million ($24.5 million after tax) which included estimated costs related to
involuntary workforce reductions.
(2) Merger costs incurred for twelve months ended September 30, 2000
totaled $31.3 million. These costs relate primarily to transaction costs,
severance and other merger integration activities. Vectren expects to realize
net merger savings of nearly $200 million over the next ten years from the
elimination of duplicate corporate and administrative programs and greater
efficiencies in operations, business processes and purchasing.
The continued merger integration activities, which will contribute to
the merger savings, will be substantially complete by 2001. As a result of
merger integration activities, management has identified certain information
systems that are expected to be retired in 2001. Accordingly, the useful lives
of these assets have been shortened to reflect this decision, resulting in an
increase in depreciation expense of approximately $6.7 million for the twelve
months ended September 30, 2000.
In total, such costs incurred for the twelve months ended September 30,
2000 were $38.0 million ($27.6 million after tax) or $.45 per share.
<PAGE>
Selected Pro Forma Condensed Financial Information
The accompanying pro forma financial information presents the condensed
unaudited pro forma balance sheet of Vectren as of September 30, 2000 and the
unaudited pro forma statement of income for the nine months ended September 30,
2000 and for the year ended December 31, 1999.
On October 31, 2000, Vectren completed its acquisition of the natural
gas distribution assets of Dayton Power for approximately $465 million pursuant
to an Asset Purchase Agreement dated December 14, 1999. Vectren acquired the gas
utility assets as a tenancy in common through two separate wholly-owned
subsidiaries. Operations will be conducted under the name of Vectren of Ohio.
Under the acquisition structure Indiana Gas, one of Vectren's operating public
utilities, holds a 47% undivided ownership interest and Vectren of Ohio has a
53% undivided ownership interest.
The unaudited condensed pro forma balance sheet information as of
September 30, 2000 is presented as if the acquisition had occurred on September
30, 2000. The unaudited condensed pro forma income statement information for the
nine month period ended September 30, 2000 and for the year ended December 31,
1999 are presented as if the acquisition had occurred at January 1, 1999.
Preparation of the pro forma financial information was based on
assumptions deemed appropriate by us. The pro forma information is unaudited and
is not necessarily indicative of the results which actually would have occurred
if the transaction had been consummated at the beginning of the period
presented, nor does it purport to represent the future financial position and
results of operations for future periods. The pro forma information should be
read in conjunction with the audited consolidated financial statements of
Vectren filed on Form 8-K for the year ended December 31, 1999, the unaudited
financial statements of Vectren filed on Form 10-Q for the quarter ended
September 30, 2000, and the audited financial statements of The Dayton Power and
Light Company Natural Gas Distribution Business and pro forma financial
statements of Vectren filed on Form 8-K on January 16, 2001.
Year Ended Nine Months Ended
December 31, 1999 September 30, 2000
---------------------- ------------------
(in thousands, except per share data)
Income Statement Information,
For Period Ended
Operating revenue $1,287,283 $1,108,471
Operating income 182,979 96,880
Net income 87,402 45,007
Basic earnings per share
on common stock $ 1.43 $ .73
Diluted earnings per share on
common Stock $ 1.42 $ .73
Balance Sheet Information,
At Period End
Cash and Cash Equivalents $17,353
Total Assets 2,544,830
Short Term Debt 828,484
Long Term Debt 484,074
Preferred Stock 16,965
Common Stock Equity 709,702
The following pro forma information reflects the effects of the Dayton
Power acquisition, as well as the issuance by Indiana Gas on December 28, 2000
of $70,000,000 in insured quarterly notes; the issuance by Vectren Capital on
December 21, 2000 of $78,000,000 in senior notes, and the common stock offering
and use of related net proceeds of $120,934,000 to repay outstanding commercial
paper. Pro forma net income and earnings per share is presented as if these
events had occurred as of January 1, 1999. Pro forma short-term debt, long-term
debt and common stock equity are presented as if these events occurred as of
September 30, 2000.
Pro forma net income for the year ended December 31, 1999 was
$92,552,000 and for the nine month period ended September 30, 2000 was
$48,870,000. Basic earnings per share for the year ended December 31, 1999 was
$1.39 and for the nine month period ended September 30, 2000 was $.73. Diluted
earnings per share for the year ended December 31, 1999 was $1.38 and for the
nine month period ended September 30, 2000 was $.73. As of September 30, 2000,
short term debt was $559,312, long-term debt was $632,074 and common stock
equity was $830,636.
DESCRIPTION OF STOCK
General
The total amount of authorized capital stock of Vectren is 480,000,000
shares of common stock and 20,000,000 shares of preferred stock. As of January
11, 2001, 61,387,468 shares of common stock and no shares of preferred stock
were issued and outstanding. The following summary highlights the material
provisions of our Articles of Incorporation, our bylaws and the Indiana Business
Corporation Law ("IBCL") relating to our capital stock.
Board of Directors
Our Articles and bylaws contain provisions that are intended to enhance
the likelihood of continuity and stability in the composition of our board of
directors and which may have the effect of delaying, deferring, or preventing a
future takeover or change in control of Vectren unless the takeover or change in
control is approved by the board. The Articles provide for a minimum of one and
a maximum of 16 members of the board, the actual number to be specified by the
bylaws, which currently set the number of directors at 16. The Articles also
provide that the bylaws may provide for classes of directors, and in accordance
therewith, there are currently three classes of directors on the board. Notice
of nominations of persons to the board may be made by our shareholders and must
be sent to us not less than 90 nor more than 120 days before the meeting at
which directors will be elected.
Common Stock
Dividends and Rights upon Liquidation
The holders of outstanding Vectren common stock are entitled to receive
dividends out of assets legally available at the time and in the amounts as the
board of directors may from time to time determine. Our common stock is not
convertible or exchangeable into other securities, and the holders of common
stock have no preemptive or subscription rights to purchase any of our
securities. Upon liquidation, dissolution or winding up of Vectren, the holders
of our common stock are entitled to receive pro rata the assets of Vectren which
are legally available for distribution, after payment of all debts and other
liabilities and subject to the prior rights of any holders of preferred stock
then outstanding.
Voting Rights
Each outstanding Vectren common share is entitled to one vote on all
matters submitted to a vote of our shareholders. Except as otherwise required by
law or our Articles, the holders of Vectren common stock vote together on all
matters submitted to a vote of the shareholders, including the election of
directors. The bylaws provide that the representation, in person or proxy, of a
majority of the stock outstanding and entitled to vote at a meeting of
shareholders constitutes a quorum for conducting business. The Articles provide
that the following actions may be taken only with the affirmative vote of
holders of 80% of the combined voting power of the outstanding Vectren stock
entitled to vote:
o removal for cause of a director;
o amendment or repeal of the provision regarding director
removal for cause; and
o certain business combinations unless the business combination
is approved by a majority of continuing directors or the
business combination satisfies a fair price test.
A "continuing director" means any member of the board who is unaffiliated with
the other party to a business combination which is the beneficial owner of more
than 10% of the voting power of Vectren stock and who was a member of the board
prior to the time that such other party to a business combination became the
beneficial owner of more than 10% of the voting power of Vectren stock, and any
successor of a continuing director who is unaffiliated with the other party to a
business combination and is recommended to succeed a continuing director by a
majority of continuing directors then on the board.
Advance Notice of Shareholder Business; Special Meetings of Shareholders
Notice of any business proposed by a Vectren shareholder to be
conducted at any meeting of shareholders must be sent to us not less than 90 nor
more than 120 days before the meeting at which the business is conducted. The
board or our Chief Executive Officer may call special meetings of our
shareholders. Our shareholders have no right to call a special meeting of the
shareholders or to amend the bylaws.
Our shares of common stock are traded on the New York Stock Exchange
under the symbol "VVC." The transfer agent and registrar for Vectren's common
stock is EquiServe Trust Company N.A.
Preferred Stock
The board may, without further action by our shareholders, from time to
time, direct the issuance of preferred stock in series and may, at the time of
issuance, determine the rights, preferences and limitations of each series.
Satisfaction of any dividend preferences of outstanding preferred stock would
reduce the amount of funds available for the payment of dividends on our common
stock. Holders of preferred stock may be entitled to receive a preference
payment in the event of any liquidation, dissolution or winding-up of Vectren
before any payment is made to the holders of our common stock. The issuance of
preferred stock may render more difficult or tend to discourage a merger, tender
offer or proxy contest, the assumption of control by a holder of a large block
of our securities or the removal of incumbent management. The board, without
shareholder approval, may issue preferred stock with voting and conversion
and/or exchange rights, which could adversely affect the holders of our common
stock. There are no shares of preferred stock outstanding.
Shareholder Rights Agreement
The board has adopted a Shareholder Rights Agreement which is generally
designed to deter coercive takeover tactics and to encourage all persons
interested in potentially acquiring control of Vectren to treat each shareholder
on a fair and equal basis. Under the Shareholder Rights Agreement, the board has
declared a dividend distribution of one right for each outstanding Vectren
common share. A right will attach to each common share Vectren issues. Each
right entitles the holder to purchase from Vectren one share of common stock at
a price of $65.00 per share (subject to adjustment to prevent dilution).
Initially, the rights will not be exercisable. The rights become exercisable 10
days following a public announcement that a person or group of affiliated or
associated persons (a "Vectren Acquiring Person") has acquired beneficial
ownership of 15% or more of the outstanding Vectren common stock (or a 10%
acquiror who is determined by the Vectren board to be an adverse person), or 10
days following the announcement of an intention to make a tender offer or
exchange offer the consummation of which would result in any person or group
becoming a Vectren Acquiring Person. The Vectren Shareholder Rights Agreement
expires October 25, 2009.
Indiana Statutes
The IBCL limits some transactions between an Indiana company and any
person who acquires 10% or more of the company's common stock (an "interested
shareholder"). During the five-year period after the acquisition, an interested
shareholder cannot enter into a business combination with the company unless,
before the interested shareholder acquired the common stock, the board of
directors of the company approved the acquisition of common stock or approved
the business combination. After the five-year period, an interested shareholder
can enter into only the following three types of business combinations with the
company: (i) a business combination approved by the board of directors of the
company before the interested shareholder acquired the common stock; (ii) a
business combination approved by holders of a majority of the common stock not
owned by the interested shareholder; and (iii) a business combination in which
the shareholders receive a price for their common stock at least equal to a
formula price based on the highest price per common share paid by the interested
shareholder.
In addition, a person who makes a tender offer for, or otherwise
acquires shares giving that person more than 20%, 33 1/3%, and 50% of the
outstanding voting securities of an Indiana corporation that is subject to the
"Control Share Acquisitions Statute" of the IBCL may lose the right to vote the
shares which take the acquiror over these respective levels of ownership. Before
an acquiror may vote the shares that take the acquiror over these ownership
thresholds, the acquiror must obtain the approval of a majority of the shares of
each class or series of shares entitled to vote separately on the proposal,
excluding shares held by officers of the corporation, by employees of the
corporation who are directors thereof and by the acquiror. The Control Share
Acquisitions Statute also authorizes a corporation to redeem the shares held by
a person that exceed the ownership thresholds in the statute, provided that the
corporation's articles or bylaws authorized such a redemption prior to the date
the person acquires such shares. Our articles and bylaws do not include a
provision authorizing such a redemption. An Indiana corporation otherwise
subject to the Control Share Acquisitions Statute may elect not to be covered by
the statute by so providing in its articles of incorporation or bylaws. Because
we have not made such an election in our articles or bylaws, acquisitions of our
shares remain subject to the statute.
CERTAIN UNITED STATES TAX CONSIDERATIONS
FOR NON-UNITED STATES HOLDERS
The following is a general discussion of certain U.S. federal income
and estate tax consequences of the ownership and disposition of the common stock
by holders who are not U.S. persons (non-United States holders) and who acquire
and own the common stock as capital assets within the meaning of Section 1221 of
the Internal Revenue Code of 1986, as amended (Code). For this purpose, a
"non-United States holder" is any holder that is not a "U.S. person" (as defined
below). For purposes of this discussion, the term "U.S. person" means (i) a
citizen or resident of the United States, (ii) a corporation, partnership, or
other entity created or organized in the United States or under the laws of the
United States or of any political subdivision of the United States, (iii) an
estate whose income is includible in gross income for U.S. federal income tax
purposes regardless of its source, or (iv) a trust whose administration is
subject to the primary supervision of a U.S. court and which has one or more
U.S. persons who have the authority to control all substantial decisions of the
trust. This discussion does not address all aspects of U.S. federal income and
estate taxation that may be relevant in light of any non-United States holder's
particular facts and circumstances (such as being a U.S. expatriate) and does
not address any tax consequences arising under the laws of any state, local or
non-U.S. taxing jurisdiction. Furthermore, the following discussion is based on
current provisions of the Code and administrative and judicial interpretations,
all as in effect on the date of this prospectus supplement, and all of which are
subject to change, possibly with retroactive effect. Prospective non-U.S.
investors are urged to consult their tax advisors regarding the U.S. federal,
state, local and non-U.S. income, estate, and other tax consequences of owning
and disposing of the common stock.
Dividends
If we pay a dividend, the amount payable to a non-United States holder
of common stock whose income with respect to its investment in a common stock is
not effectively connected with the conduct of a U.S. trade or business generally
will be subject to U.S. withholding tax either at a rate of 30% of the gross
amount of the dividend or such lower rate as may be specified by an applicable
tax treaty. A non-United States holder who is an individual or corporation (or
an entity treated as a corporation for federal income tax purposes) holding
common stock on its own behalf will be required to submit to the last
Withholding Agent, as defined below, an Internal Revenue Service ("IRS") Form
W-8BEN or other permitted documentation certifying its entitlement to treaty
relief from withholding. A "Withholding Agent" is the United States payor (or a
Non-United States payor who is a qualified intermediary, U.S. branch of foreign
person, or withholding foreign partnership) in the chain of payment prior to
payment to a Non-U.S. Holder, which itself is not a Withholding Agent.
Non-United States holders should consult their tax advisors on submission of
such documentation.
Dividends received by a non-United States holder that are effectively
connected with a U.S. trade or business conducted by such non-United States
holder are exempt from withholding tax provided the non-United States holder
filed IRS Form W-8ECI. However, such effectively connected dividends, net of
certain deductions and credits, are taxed at the same graduated rates applicable
to U.S. persons.
In addition to the graduated tax described above, dividends received by
a corporate non-United States holder that are effectively connected with a U.S.
trade or business of the corporate non-United States holder may also be subject
to a branch profits tax at a rate of 30% or such lower rate as may be specified
by an applicable tax treaty.
Gain on Disposition of Common Stock
A non-United States holder generally will not be subject to U.S.
federal income tax on any gain realized upon the sale or other disposition of
common stock unless: (i) such gain is effectively connected with a U.S. trade or
business of the non-United States holder, (ii) the non-United States holder is
an individual who holds common stock as a capital asset and who is present in
the United States for a period or periods aggregating 183 days or more during
the calendar year in which such sale or disposition occurs and certain other
conditions are met, or (iii) we are or have been a "United States real property
holding corporation" for federal income tax purposes at any time within the
shorter of the five-year period preceding such disposition or such holder's
holding period. Although we believe we are not and are unlikely to become a
United States real property holding corporation, we may be one, or we may become
one, because of our ownership of substantial real estate assets in the United
States. If we were to be treated as a United States real property holding
company, a non-United States holder who holds, directly or indirectly, more than
5% of our common stock will be subject to U.S. federal income taxation on any
gain realized from the sale or exchange of such stock, unless an exemption is
provided under an applicable treaty.
Backup Withholding and Information Reporting
Generally, we must report to the IRS the amount of dividends paid, the
name and address of the recipient, and the amount, if any, of tax withheld. A
similar report is sent to the holder. Pursuant to tax treaties or other
agreements, the IRS may make its reports available to tax authorities in the
recipient's country of residence.
Backup withholding (which is generally imposed at a rate of 31% on
certain payments to persons who fail to furnish certain information to the
payer) will generally not apply to dividends to which the 30% gross withholding
tax would otherwise apply, absent certification for entitlement to a reduced
withholding rate (unless the payer has knowledge that the payee is a U.S.
person). Dividends paid to a non-United States holder at an address within the
United States may be subject to backup withholding at a rate of 31% if the
non-United States holder fails to establish that it is entitled to an exemption
or to provide a correct taxpayer identification number and other information to
the payer.
Generally, the payment of the proceeds of the disposition of common
stock to or through the U.S. office of a broker is subject to information
reporting and backup withholding at a rate of 31% unless the holder certifies
its non-U.S. status on IRS Form W-8BEN or similar form or otherwise establishes
an exemption. A U.S. holder that certifies its U.S. status by providing a valid
IRS Form W-9 will not be subject to backup withholding.
Backup withholding is not an additional tax. Rather, the tax liability
of persons subject to backup withholding will be reduced by the amount of tax
withheld. If withholding results in an overpayment of taxes, a refund may be
obtained, provided that the required information is furnished to the IRS.
Estate Tax
Individual non-United States holders who own common stock at the time
of their deaths or made certain lifetime transfers of interests in common stock
will be required to include the value of such common stock in their gross
estates for U.S. federal estate tax purposes, unless an applicable estate tax
treaty provides otherwise.
THE FOREGOING DISCUSSION IS A SUMMARY OF THE PRINCIPAL FEDERAL INCOME
AND ESTATE TAX CONSEQUENCES OF THE OWNERSHIP, SALE OR OTHER DISPOSITION OF
COMMON STOCK BY NON-UNITED STATES HOLDERS. ACCORDINGLY, INVESTORS ARE URGED TO
CONSULT THEIR OWN TAX ADVISORS WITH RESPECT TO THE INCOME TAX CONSEQUENCES OF
THE OWNERSHIP AND DISPOSITION OF COMMON STOCK, INCLUDING THE APPLICATION AND
EFFECT OF THE LAWS OF ANY STATE, LOCAL, FOREIGN OR OTHER TAXING JURISDICTION.
<PAGE>
UNDERWRITING
We intend to offer the shares of common stock through the underwriters
named below, for whom Merrill Lynch, Pierce, Fenner & Smith Incorporated is
acting as representative. Subject to the terms and conditions described in a
purchase agreement among us and the underwriters, we have agreed to sell to the
underwriters, and the underwriters severally have agreed to purchase from us,
the number of shares listed opposite their names below.
Underwriter Number of Shares
----------- ----------------
Merrill Lynch, Pierce, Fenner & Smith
Incorporated ...............................
Credit Suisse First Boston Corporation...................
A.G. Edwards & Sons, Inc.................................
Edward Jones & Co., L.P..................................
UBS Warburg LLC..........................................
Total ......................................
==========
The underwriters have agreed to purchase all of the shares sold under
the purchase agreement if any of these shares are purchased. If an underwriter
defaults, the purchase agreement provides that the purchase commitments of the
nondefaulting underwriters may be increased or the purchase agreement may be
terminated.
We have agreed to indemnify the underwriters against certain
liabilities, including liabilities under the Securities Act, or to contribute to
payments the underwriters may be required to make in respect of those
liabilities.
Merrill Lynch will be facilitating Internet distribution for this
offering to certain of its Internet subscription customers. Merrill Lynch
intends to allocate a limited number of shares for sale to its online brokerage
customers. An electronic prospectus is available on the Web site maintained by
Merrill Lynch. Other than the prospectus in electronic format, the information
on the Merrill Lynch Web site relating to this offering is not a part of this
prospectus.
The underwriters are offering the shares, subject to prior sale, when,
as and if issued to and accepted by them, subject to approval of legal matters
by their counsel, including the validity of the shares, and other conditions
contained in the purchase agreement, such as the receipt by the underwriters of
officer's certificates and legal opinions. The underwriters reserve the right to
withdraw, cancel or modify offers to the public and to reject orders in whole or
in part.
Commissions and Discounts
The representative has advised us that the underwriters propose
initially to offer the shares to the public at the initial public offering price
on the cover page of this prospectus and to dealers at that price less a
concession not in excess of $____ per share. The underwriters may allow, and the
dealers may reallow, a discount not in excess of $___ per share to other
dealers. After the initial public offering, the public offering price,
concession and discount may be changed.
The following table shows the public offering price, underwriting
discount and proceeds before expenses to us. The information assumes either no
exercise or full exercise by the underwriters of their over-allotment option.
Per Share Without Option With Option
--------- -------------- -----------
Public Offering Price...............$ $ $
Underwriting discount...............
Proceeds, before expenses, to
Vectren.............................
The expenses of the offering, not including the underwriting discount,
are estimated at $_________ and are payable by us.
Over-allotment Option
We have granted an option to the underwriters to purchase up to 825,000
additional shares at the public offering price less the underwriting discount.
The underwriters may exercise this option for 30 days from the date of this
prospectus solely to cover any over-allotments. If the underwriters exercise
this option, each will be obligated, subject to conditions contained in the
purchase agreement, to purchase a number of additional shares proportionate to
that underwriter's initial amount reflected in the above table.
No Sale of Similar Securities
We, our directors, our executive officers and certain of our
stockholders have agreed, with exceptions, not to sell or transfer any common
stock for 90 days after the date of this prospectus without first obtaining the
written consent of the representative. Specifically, we and these other
individuals have agreed not to directly or indirectly
o offer, pledge, sell or contract to sell any common stock,
o sell any option or contract to purchase any common stock,
o purchase any option or contract to sell any common stock,
o grant any option, right or warrant for the sale of any common
stock,
o lend or otherwise dispose of or transfer any common stock,
o request or demand that we file a registration statement
related to the common stock, or
o enter into any swap or other agreement that transfers, in
whole or in part, the economic consequence of ownership of any
common stock, whether any such swap or transaction is to be
settled by delivery of shares or other securities, in cash or
otherwise.
This lockup provision applies to common stock and to securities
convertible into or exchangeable or exercisable for or repayable with common
stock. It also applies to common stock owned now or acquired later by the
person executing the agreement or for which the person executing the agreement
later acquires the power of disposition.
New York Stock Exchange Listing
Our shares of common stock are traded on the New York Stock Exchange
under the symbol "VVC."
Price Stabilization and Short Position
Until the distribution of the shares offered hereby is completed, SEC
rules may limit the underwriters and selling group members from bidding for or
purchasing our common stock. However, the representative may engage in
transactions that stabilize the price of our common stock, such as bids or
purchases that peg, fix or maintain that price.
If the underwriters create a short position in the common stock in
connection with the offering, i.e., if they sell more shares than are listed
on the cover page of this prospectus, the representative may reduce that short
position by purchasing shares in the open market. The representative may also
elect to reduce any short position by exercising all or part of the
over-allotment option described above. Purchases of the common stock to
stabilize its price or to reduce a short position may cause the price of the
common stock to be higher than it might be in the absence of such purchases.
Neither we nor any of the underwriters makes any representation or
prediction as to the direction or magnitude of any effect that the
transactions described above may have on the price of the common stock. In
addition, neither we nor any of the underwriters makes any representation that
the representative will engage in these transactions or that these
transactions, once commenced, will not be discontinued without notice.
Other Relationships
Some of the underwriters and their affiliates have engaged in, and may
in the future engage in, investment banking and other commercial dealings in
the ordinary course of business with us and our affiliates. They have received
customary fees and commissions for these previous transactions.
LEGAL MATTERS
The validity of the shares of common stock offered hereby will be
passed upon for us by Barnes & Thornburg, Indianapolis, Indiana. Certain legal
matters will be passed upon for the underwriters by Brown & Wood LLP, New
York, New York.
EXPERTS
The audited consolidated financial statements of Vectren Corporation as
of December 31, 1999 and 1998 and for each of the years in the three year
period ended December 31, 1999 incorporated by reference in this prospectus
and elsewhere in the registration statement have been audited by Arthur
Andersen LLP, independent public accountants, as indicated in their report
with respect thereto, and are included herein in reliance upon the authority
of said firm as experts in accounting and auditing in giving said report.
The audited financial statements of Dayton Power's natural gas retail
distribution business as of December 31, 1999 and for the year then ended
incorporated in this prospectus by reference to Vectren Corporation's Current
Report on Form 8-K dated January 16, 2001 have been so incorporated in
reliance on the report of PricewaterhouseCoopers LLP, independent accountants,
given on the authority of said firm as experts in auditing and accounting.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and
other information with the Securities and Exchange Commission under the
Securities Exchange Act of 1934, as amended. Our filings are available on the
SEC's web site at http://www.sec.gov. You may also read and copy this
information at the following locations of the SEC:
Public Reference Room 7 World Trade Center Citicorp Center
450 Fifth Street, N.W. Suite 1300 500 West Madison Street
Washington, D.C. 20549 New York, New York 10048 Suite 1400
Chicago, Illinois 60661
You can obtain copies of this information by mail from the Public Reference Room
of the SEC, 450 Fifth Street, N.W., Room 10024, Washington D.C. 20549, at
prescribed rates. You may obtain information on the operation of the Public
Reference Room by calling the SEC at (800) SEC-0330. Our filings are also
available at the offices of the New York Stock Exchange, Inc., 20 Broad Street,
New York, New York 10005.
Our common stock is listed on the New York Stock Exchange and you can
inspect reports, proxy statements and other information about us at the offices
of the New York Stock Exchange, Inc., 20 Broad Street, New York, New York 10005
We have filed with the SEC a registration statement on Form S-3 that
registers the securities we are offering. The registration statement, including
the attached exhibits and schedules, contains additional relevant information
about us and the securities offered. The rules and regulations of the SEC allow
us to omit certain information included in the registration statement from this
prospectus.
The SEC allows us to "incorporate by reference" information into this
prospectus. This means that we can disclose important information to you by
referring you to another document filed separately with the SEC. The information
incorporated by reference is considered to be part of this prospectus, except
for any information that is superseded by information that is contained or
otherwise incorporated by reference in this prospectus.
This prospectus includes by reference the documents listed below that
we have previously filed with the SEC and that are not included in or delivered
with this document and any future filings we make with the SEC under Sections
13(a), 13(c), 14, or 15(d) of the Securities Exchange Act of 1934 (i) between
the date of this preliminary prospectus and prior to the effectiveness of the
registration statement that registers the securities we are offering and (ii)
until the termination of the offering being made by this prospectus. Our
Commission File No. is 1-15467.
o Annual Report on Form 10-K for the year ended December 31,
1999;
o Quarterly Report on Form 10-Q for the quarter ended March 31,
2000;
o Quarterly Report on Form 10-Q for the quarter ended June 30,
2000;
o Quarterly Report on Form 10-Q for the quarter ended September
30, 2000;
o Amendment to Quarterly Report on Form 10-Q for the quarter
ended September 30, 2000;
o Current Report on Form 8-K filed on March 24, 2000;
o Current Report on Form 8-K filed on April 14, 2000;
o Current Reports on Form 8-K filed on April 27, 2000 (two
filings);
o Current Report on Form 8-K filed on May 31, 2000;
o Current Report on Form 8-K filed on July 11, 2000;
o Current Report on Form 8-K filed on July 28, 2000;
o Current Report on Form 8-K filed on November 15, 2000;
o Current Report on Form 8-K filed on December 15, 2000;
o Current Report on Form 8-K filed on December 22, 2000;
o Current Report on Form 8-K filed on December 27, 2000;
o Current Reports on Form 8-K filed on January 5, 2001 (two
filings);
o Current Report on Form 8-K filed on January 16, 2001; and
o The description of our common stock contained in our
registration statement on Form 8-A filed on November 16, 1999.
o The description of our common stock purchase rights contained
in our registration statement on Form 8-A filed on November 16,
1999.
You can obtain any of the documents incorporated by reference in this
document from us without charge, excluding any exhibits to those documents
unless the exhibit is specifically incorporated by reference as an exhibit to
this prospectus. You can obtain documents incorporated by reference in this
prospectus by requesting them in writing or by telephone from us at the
following address:
Investor Relations
Vectren Corporation
20 N.W. Fourth Street
Evansville, Indiana 47741
(812) 491-4000
<PAGE>
[INSIDE BACK COVER]
<PAGE>
5,500,000 Shares
VECTREN CORPORATION
[LOGO]
Common Stock
(and Common Stock Purchase Rights)
----------------------
PROSPECTUS
----------------------
MERRILL LYNCH & CO.
CREDIT SUISSE FIRST BOSTON
A.G. EDWARDS & SONS, INC.
EDWARD JONES & CO., L.P.
UBS WARBURG LLC
______________, 2001
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The aggregate estimated expenses, other than underwriting discounts and
commissions, in connection with the offering pursuant to this registration
statement are currently anticipated to be as follows (all amounts except for the
Securities and Exchange Commission filing fee are estimated):
Registration Fee
New York Stock Exchange Filing Fee
NASD Filing Fee
Printing and Engraving Expenses
Legal Fees and Expenses
Accounting Fees and Expenses
Miscellaneous ________
Total $
========
* to be provided by amendment
Item 15. Indemnification of Directors and Officers.
The Vectren Articles and the Vectren bylaws provide that Vectren will
indemnify any individual who is or was a director or officer of Vectren, or is
or was serving at the request of Vectren as a director, officer, partner or
trustee of another foreign or domestic corporation, partnership, joint venture,
trust, employee benefit plan or other enterprise whether or not for profit,
against liability and expenses, including attorneys fees, incurred by him in any
action, suit, or proceeding, whether civil, criminal, administrative, or
investigative, and whether formal or informal, in which he is made or threatened
to be made a party by reason of being or having been in any such capacity, or
arising out of his status as such, except (i) in the case of any action, suit,
or proceeding terminated by judgment, order, or conviction, in relation to
matters as to which he is adjudged to have breached or failed to perform the
duties of his office and the breach or failure to perform constituted willful
misconduct or recklessness; and (ii) in any other situation, in relation to
matters as to which it is found by a majority of a committee composed of all
directors not involved in the matter in controversy (whether or not a quorum)
that the person breached or failed to perform the duties of his office and the
breach or failure to perform constituted willful misconduct or recklessness.
Vectren may pay for or reimburse reasonable expenses incurred by a director or
officer in defending any action, suit, or proceeding in advance of the final
disposition thereof upon receipt of (i) a written affirmation of the director's
or officer's good faith belief that such director or officer has met the
standard of conduct prescribed by Indiana law; and (ii) an undertaking of the
director or officer to repay the amount paid by Vectren if it is ultimately
determined that the director or officer is not entitled to indemnification by
Vectren.
The Vectren Articles and the Vectren bylaws provide that the
indemnification rights described above are in addition any other indemnification
rights a person may have by law. The employment agreements with its executive
officers will require Vectren to indemnify the executive officers in accordance
with its indemnification policies for its senior executives, subject to
applicable law.
Section 23-1-37 et seq. of the IBCL provides for "mandatory
indemnification," unless limited by the articles, by a corporation against
reasonable expenses incurred by a director who is wholly successful, on the
merits or otherwise, in the defense of any proceeding to which the director was
a party by reason of the director being or having been a director of the
corporation. Section 23-1-37-10 of the IBCL states that a corporation may, in
advance of the final disposition of a proceeding, reimburse reasonable expenses
incurred by a director who is a party to a proceeding if the director furnishes
the corporation with a written affirmation of the director's good faith belief
that the director acted in good faith and reasonably believed the actions were
in the best interest of the corporation (or if the actions are not in an
official capacity, the actions were not opposed to the best interests of the
corporation) if the proceeding is a civil proceeding. If the proceeding is
criminal, the director must furnish a written affirmation that the director had
reasonable cause to believe he or she was acting lawfully or the director or
officer had no reason to believe the action was unlawful. The director must
undertake to repay the advance if it is ultimately determined that such director
did not meet the standard of conduct required by the IBCL. In addition, those
making the decision to reimburse the director must determine that the facts then
known would not preclude indemnification under the IBCL.
The IBCL permits a corporation to grant indemnification rights in
addition to those provided by statute, limited only by the fiduciary duties of
the directors approving the indemnification and public policies of the State of
Indiana.
Item 16. Exhibits.
Number Description
------ -----------
1.1 Form of Purchase Agreement
2.1 Agreement and Plan of Merger dated as of June 11, 1999 among Indiana
Energy, Inc., SIGCORP, Inc. and Vectren Corporation (the "Merger
Agreement") (Incorporated by reference to Exhibit 2 to Registrant's
Form S-4 (Registration No. 333-90763) filed on November 12, 1999)
2.2 Amendment No. 1 to the Merger Agreement dated December 14, 1999
(Incorporated by reference to Exhibit 2 to Indiana Energy, Inc.'s
(Commission File No. 1-09091) Current Report on Form 8-K filed on
December 16, 1999)
2.3 Asset Purchase Agreement dated December 14, 1999 between Indiana
Energy, Inc. and The Dayton Power and Light Company and Number -3CHK
with a commitment letter for a 364-Day Credit Facility dated December
16, 1999 (Incorporated by reference to Exhibit 2 and 99.1 of Indiana
Energy, Inc.'s Current Report on Form 8-K dated December 28, 1999.)
4.1 Amended and Restated Articles of Incorporation of Vectren Corporation
effective March 31, 2000 (Incorporated by reference to Exhibit 4.1 to
the Current Report on Form 8-K of Registrant filed on April 14, 2000)
4.2 Code of By-Laws of Vectren Corporation
4.3 Shareholders Rights Agreement dated as of October 21, 1999 between
Vectren Corporation and Equiserve Trust Company, N.A., as Rights Agent
(Incorporated by reference to Exhibit 4 to Registrant's Form S-4
(Registration No. 333-90763) filed on November 12, 1999)
5.1 Opinion of Barnes and Thornburg
23.1 Consent of Arthur Andersen LLP
23.2 Consent of PricewaterhouseCoopers LLP
23.3 Consent of Barnes and Thornburg (included in Exhibit 5.1)
24.1 Power of Attorney
<PAGE>
Item 17. Undertakings.
The undersigned hereby undertakes:
(1) That, for purposes of determining any liability under the
Securities Act of 1933, each filing of the registrant's annual report
pursuant to Section 13(a) or Section 15(d) of the Securities Exchange
Act of 1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Securities
Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering
of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(2) Insofar as indemnification for liabilities arising under
the Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the Registrant pursuant to the foregoing
provisions, or otherwise, the Registrant has been advised that in the
opinion of the Securities and Exchange Commission such indemnification
is against public policy as expressed in the Securities Act of 1933 and
is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities, other than the payment by the
Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant in the successful defense of any
action, suit or proceeding, is asserted by such director, officer or
controlling person in connection with the securities being registered,
the Registrant will, unless in the opinion of its counsel the matter has
been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by itself is
against public policy as expressed in the Securities Act of 1933 and
will be governed by the final adjudication of such issue.
(3) That, for purposes of determining any liability under the
Securities Act of 1933, the information omitted from the form of
prospectus filed as part of this registration statement in reliance upon
Rule 430A and contained in a form of prospectus filed by the registrant
pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act
shall be deemed to be part of this registration statement as of the time
it was declared effective.
(4) That, for the purpose of determining any liability under
the Securities Act of 1933, each post-effective amendment that contains
a form of prospectus shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide
offering thereof.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Evansville, State of Indiana, on January 18, 2001.
VECTREN CORPORATION
By: /s/ Ronald E. Christian
------------------------------------------
Ronald E. Christian, Senior Vice
President, Secretary and General Counsel
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated.
Signature Title Date
--------- ----- ----
(1) Principal Executive Officer
/s/ Niel C. Ellerbrook
------------------------------------ Chairman and Chief January 18, 2001
Niel C. Ellerbrook Executive Officer
(2) Principal Financial Officer
/s/ Jerome A. Benkert
------------------------------------ Executive Vice President January 18, 2001
Jerome A. Benkert and Chief Financial
Officer
(3) Principal Accounting Officer
/s/ M. Susan Hardwick
------------------------------------ Vice President and January 18, 2001
M. Susan Hardwick Controller
<PAGE>
(4) A Majority of the Board of Directors
/s/ John M. Dunn Director
--------------------------------------
John M. Dunn
/s/ Niel C. Ellerbrook Director
--------------------------------------
Niel C. Ellerbrook
/s/ John D. Engelbrecht Director
--------------------------------------
John D. Engelbrecht
/s/ Lawrence A. Ferger Director
--------------------------------------
Lawrence A. Ferger
/s/ Anton H. George Director
--------------------------------------
Anton H. George
/s/ Andrew E. Goebel Director January 18, 2001
--------------------------------------
Andrew E. Goebel
/s/ Robert L. Koch II Director
--------------------------------------
Robert L. Koch II
/s/ William G. Mays Director
--------------------------------------
William G. Mays
/s/ J. Timothy McGinley Director
--------------------------------------
J. Timothy McGinley
/s/ Donald A. Rausch Director
--------------------------------------
Donald A. Rausch
/s/ Richard P. Rechter Director
--------------------------------------
Richard P. Rechter
/s/ Ronald G. Reherman Director
--------------------------------------
Ronald G. Reherman
/s/ James C. Shook Director
--------------------------------------
James C. Shook
/s/ Richard W. Shymanski Director
--------------------------------------
Richard W. Shymanski
/s/ James S. Vinson Director
--------------------------------------
James S. Vinson
/s/ Jean L. Wojtowicz Director
--------------------------------------
Jean L. Wojtowicz
<PAGE>
EXHIBIT INDEX
Number Description
------ -----------
1.1 Form of Purchase Agreement
2.1 Agreement and Plan of Merger dated as of June 11, 1999 among
Indiana Energy, Inc., SIGCORP, Inc. and Vectren Corporation
(the "Merger Agreement") (Incorporated by reference to Exhibit
2 to Registrant's Form S-4 (Registration No. 333-90763) filed
on November 12, 1999)
2.2 Amendment No. 1 to the Merger Agreement dated December 14,
1999 (Incorporated by reference to Exhibit 2 to Indiana
Energy, Inc.'s (Commission File No. 1-09091) Current Report on
Form 8-K filed on December 16, 1999)
2.3 Asset Purchase Agreement dated December 14, 1999 between
Indiana Energy, Inc. and The Dayton Power and Light Company
and Number -3CHK with a commitment letter for a 364-Day Credit
Facility dated December 16, 1999 (Incorporated by reference to
Exhibit 2 and 99.1 of Indiana Energy, Inc.'s Current Report on
Form 8-K dated December 28, 1999.)
4.1 Amended and Restated Articles of Incorporation of Vectren
Corporation effective March 31, 2000 (Incorporated by
reference to Exhibit 4.1 to the Current Report on Form 8-K of
Registrant filed on April 14, 2000)
4.2 Code of By-Laws of Vectren Corporation
4.3 Shareholders Rights Agreement dated as of October 21, 1999
between Vectren Corporation and Equiserve Trust Company, N.A.,
as Rights Agent (Incorporated by reference to Exhibit 4 to
Registrant's Form S-4 (Registration No. 333-90763) filed on
November 12, 1999)
5.1 Opinion of Barnes and Thornburg
23.1 Consent of Arthur Andersen LLP
23.2 Consent of PricewaterhouseCoopers LLP
23.3 Consent of Barnes and Thornburg (included in Exhibit 5.1)
24.1 Power of Attorney
