<PAGE> 1
Securities and Exchange Commission January 8, 1996
450 Fifth Street, N.W.
Judiciary Plaza
Washington, DC 20549
Dear Sirs:
Interim Report Under Rule 24 of the
Public Utility Holding Company Act of 1935
The Columbia Gas System, Inc.
File No. 70-8627
This certificate is being provided pursuant to Rule 24 under the
Public Utility Holding Company Act of 1935, as amended (the "Act"), in
connection with the Application-Declaration on Form U-1 (File No. 70-8627), as
amended by Amendments Nos. 1, 2 and 3 (collectively, the "Declaration"), filed
by The Columbia Gas System, Inc. ("Columbia") relating to certain proposed
transactions and financial arrangements connected with the reorganization of
Columbia and its principal pipeline subsidiary, Columbia Gas Transmission
Corporation ("TCO"). By Memorandum Opinion and Order dated August 25, 1995
(HCAR No. 35-2636; the "Order"), the Commission approved Columbia's plan or
reorganization and its participation in TCO's plan of reorganization and
related transactions.(1)
Pursuant to Rule 24 under the Act, Columbia hereby certifies that the
following transactions were implemented on November 28, 1995, the effective
date of both the Columbia Plan and TCO Plan, in accordance with the terms and
conditions of, and for the purposes represented by, the Declaration and Order:
1. Columbia (a) acquired $1,011,744,716.90 of new TCO Mortgage
Bonds in partial settlement of Columbia's secured claim
against TCO and (b) made a capital contribution to TCO in the
amount of $1.2 billion for the balance of Columbia's claims
against the TCO estate.
2. Columbia entered into the New Indenture with Marine Midland
Bank, as trustee, in substantially the form filed as an
exhibit to the Declaration, and seven supplemental indentures
thereto.
3. Columbia issued $2,000,056,000 of New Indenture Securities
pursuant to the New Indenture, as supplemented, as detailed
below:
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(1) Capitalized terms used but not defined herein shall have the meanings
ascribed to them in the Declaration.
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<TABLE>
<CAPTION>
SERIES PRINCIPAL AMOUNT MATURITY DATE COUPON
----------------- ---------------- -------------- ------
<S> <C> <C> <C>
Due November 2000 $310,876,000 11/28/2000 6.39%
Due November 2002 281,530,000 11/28/2002 6.61
Due November 2005 281,530,000 11/28/2005 6.80
Due November 2007 281,530,000 11/28/2007 7.05
Due November 2010 281,530,000 11/28/2010 7.32
Due November 2015 281,530,000 11/28/2015 7.42
Due November 2025 281,530,000 11/28/2025 7.62
</TABLE>
4. Columbia issued Preferred Stock and DECS as detailed below:
<TABLE>
<CAPTION>
NUMBER OF PAR VALUE LIQUIDATION TOTAL
COUPON SHARES ISSUED PER SHARE VALUE PER SHARE LIQUIDATION VALUE
------ ------------- --------- --------------- -----------------
<S> <C> <C> <C> <C> <C>
Preferred Stock 7.89% 7,999,494 $10 $25.00 $199,987,350.00
DECS 5.22 4,898,946 10 40.82 199,974,976.72
</TABLE>
5. Columbia entered into a $1 billion credit facility with a
group of banks with Citibank, N.A. as the lead bank.
6. Columbia filed a Restated Certificate of Incorporation with
the Secretary of State of the State of Delaware in
substantially the form filed as an exhibit to the Declaration.
Attached is a "past tense" Opinion of Counsel relating to the
above-described transaction.
Very truly yours,
THE COLUMBIA GAS SYSTEM, INC.
By /s/ L. J. BAINTER
-----------------------------------
L. J. Bainter, Treasurer
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[COLUMBIA GAS SYSTEM LETTERHEAD]
January 8, 1996
Securities and Exchange Commission
Judiciary Plaza
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: The Columbia Gas System, Inc.
File No. 70-8627
Gentlemen:
As counsel for The Columbia Gas System, Inc. ("Columbia"), a
Delaware corporation and a holding company registered under the Public Utility
Holding Company Act of 1935, as amended (the "Act"), and at its request, I
deliver to you this opinion pursuant to Rule 24 under the Act in connection
with the Application-Declaration on Form U-1 (File No. 70-8627), as amended by
Amendments Nos. 1, 2 and 3 (collectively, the "Declaration"), filed by Columbia
relating to certain proposed transactions and financial arrangements connected
with the reorganization of Columbia and its principal pipeline subsidiary,
Columbia Gas Transmission Corporation ("TCO"), a Delaware corporation and
wholly-owned subsidiary of Columbia. By Memorandum Opinion and Order dated
August 25, 1995 (HCAR No. 35-2636; the "Order"), the Commission approved
Columbia's plan of reorganization and its participation in TCO's plan of
reorganization and related transactions.(1)
Columbia and TCO (collectively sometimes referred to hereinafter
as the "Companies") had been operating as debtors-in-possession pursuant to
Chapter 11 of the United States Bankruptcy Code (the "Bankruptcy Code") since
their concurrent filings thereunder on July 31, 1991. On April 17, 1995, the
Companies respectively filed with the United States Bankruptcy Court for the
District of Delaware (the "Bankruptcy Court") their proposed plans of
reorganization and disclosure statements pursuant to Chapter 11 of the
Bankruptcy Code. On June 14, 1995, the Companies filed with the Bankruptcy
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(1) Capitalized terms used but not defined herein shall have the meanings
ascribed in the Declaration.
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Securities and Exchange Commission
January 8, 1996
Page 2
Court amended versions of their respective plans of reorganization and
disclosure statements (as to TCO, the "TCO Plan" and "TCO Disclosure
Statement"). On July 27, 1995, Columbia filed a further amended reorganization
plan and disclosure statement with the Bankruptcy Court (the "Columbia Plan"
and "Columbia Disclosure Statement," respectively). By separate orders, dated
November 15, 1995 (collectively, the "Confirmation Orders"), the Bankruptcy
Court confirmed the Columbia Plan and TCO Plan; both orders became final on
November 28, 1995 in accordance with Chapter 11 of the Bankruptcy Code.
The following transactions (collectively, the "Transactions"),
as described in the Declaration, were implemented on November 28, 1995, the
effective date of both the Columbia Plan and TCO Plan, in accordance with the
terms and conditions of, and for the purposes represented by, the Declaration
and Order:
(i) Columbia (a) acquired $1,011,744,716.90 of new TCO
Mortgage Bonds in partial settlement of Columbia's
secured claim against TCO and (b) made a capital
contribution to TCO in the amount of $1.2 billion for
the balance of Columbia's secured claim against TCO;
(ii) Columbia entered into the New Indenture with Marine
Midland Bank, as trustee, in substantially the form
filed as an exhibit to the Declaration, and seven
supplemental indentures thereto;
(iii) Columbia issued $2,000,056,000 of New Indenture
Securities pursuant to the New Indenture, as supplemented;
(iv) Columbia issued 7,999,494 shares of Preferred Stock and
4,898,946 shares of DECS as part of the implementation
of the Columbia Plan;
(v) Columbia entered into a $1 billion credit facility (the
"Bank Facility") with a group of banks, with Citibank,
N.A. as the lead bank;
(vi) Columbia filed a Restated Certificate of Incorporation
with the Secretary of State of the State of Delaware and
filed Certificates of Designation with respect to the
Preferred Stock and DECS, in substantially the forms
filed as exhibits to the Declaration; and
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Securities and Exchange Commission
January 8, 1996
Page 3
(vii) Columbia agreed to guarantee (the "TCO Guarantee") (a)
TCO's settlement with its customer-creditors and (b) the
payment of the same distribution percentage of
ultimately allowed claims of other unsecured creditors,
including producer-creditors who did not accept the
settlement amounts proposed in the TCO Plan.
In connection with the above, I have examined:
(A) the Declaration and Order;
(B) the Confirmation Orders;
(C) copies of the Columbia Plan and the TCO Plan;
(D) copies of the Columbia Disclosure Statement and the TCO Disclosure
Statement; and
(E) such other documents, records and matters of law as I deemed
necessary to enable me to render this opinion.
As to any facts material to this opinion that I did not
independently establish or verify, I have relied upon statements and
representations of the Companies and their respective officers and other
representatives and the Interim Certificate pursuant to Rule 24 being filed
contemporaneously herewith.
Based on the foregoing and relying thereon, I am of the opinion that:
(1) all state laws applicable to the Transactions have been complied
with;
(2) Columbia and TCO are validly organized and duly existing
corporations in their respective state of incorporation;
(3) the TCO Guarantee is a valid and binding obligation of Columbia
in accordance with its terms;
(4) the TCO Mortgage Bonds issued by TCO are valid and binding
obligations of TCO in accordance with their terms, and
Columbia has legally acquired the TCO Mortgage Bonds;
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Securities and Exchange Commission
January 8, 1996
Page 4
(5) the notes or other evidence of indebtedness issued by Columbia
in establishing and making borrowings under the Bank Facility
are valid and binding obligations of Columbia in accordance
with their terms;
(6) the New Indenture Securities issued by Columbia are valid and
binding obligations of Columbia in accordance with their
terms;
(7) the Preferred Stock and DECS have been validly issued by
Columbia and are fully paid and nonassessable, and the holders
thereof are entitled to the rights and privileges respectively
pertaining thereto as set forth in, as the case may be,
Columbia's Restated Certificate of Incorporation or other
document defining such rights and privileges;
(8) the consummation of the Transactions did not violate the legal
rights of the holders of any securities issued by Columbia or
any associate company thereof; and
(9) the Transactions have been effectuated in accordance with the
Declaration, except that, to the extent that Columbia made a
capital contribution in excess of the "approximately one
billion dollars" referenced in the Declaration, said capital
contribution should be considered to have been made pursuant
to Rule 45(b)(4) as amended effective June 28, 1995.
I hereby consent to the filing of this opinion in connection
with Columbia's certificate pursuant to Rule 24 of the Act which is being filed
contemporaneously herewith.
Very truly yours,
/s/ JOYCE KORIA HAYES
--------------------------
Joyce Koria Hayes
Associate General Counsel
and Assistant Secretary
