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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTER ENDED MARCH 31, 1999
<TABLE>
<CAPTION>
COMMISSION REGISTRANTS; STATE OF INCORPORATION; I.R.S. EMPLOYER
FILE NUMBER ADDRESS; AND TELEPHONE NUMBER IDENTIFICATION NO.
- ----------- ------------------------------------ ------------------
<S> <C> <C>
1-11607 DTE Energy Company 38-3217752
(a Michigan corporation)
2000 2nd Avenue
Detroit, Michigan 48226-1279
313-235-4000
1-2198 The Detroit Edison Company 38-0478650
(a Michigan corporation)
2000 2nd Avenue
Detroit, Michigan 48226-1279
313-235-8000
</TABLE>
Indicate by check mark whether the registrants (1) have filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrants were required to file such reports), and (2) have been subject to
such filing requirements for the past 90 days. YES X NO
--- ---
At March 31, 1999, 145,045,159 shares of DTE Energy's Common Stock,
substantially all held by non-affiliates, were outstanding.
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DTE ENERGY COMPANY
AND
THE DETROIT EDISON COMPANY
FORM 10-Q
FOR THE QUARTER ENDED MARCH 31, 1999
This document contains the Quarterly Reports on Form 10-Q for the quarter ended
March 31, 1999 for each of DTE Energy Company and The Detroit Edison Company.
Information contained herein relating to an individual registrant is filed by
such registrant on its own behalf. Accordingly, except for its subsidiaries, The
Detroit Edison Company makes no representation as to information relating to any
other companies affiliated with DTE Energy Company.
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
Definitions....................................................................................................3
Quarterly Report on Form 10-Q for DTE Energy Company:
Part I - Financial Information..........................................................................4
Item 1 - Financial Statements................................................................4
Item 2 - Management's Discussion and Analysis of Financial
Condition and Results of Operations................................................20
Quarterly Report on Form 10-Q for The Detroit Edison Company:
Part I - Financial Information.........................................................................25
Item 1 - Financial Statements...............................................................25
Item 2 - Management's Discussion and Analysis of Financial
Condition and Results of Operations................................................25
Part II - Other Information.............................................................................25
Item 1 - Legal Proceedings...................................................................25
Item 5 - Other Information...................................................................26
Quarterly Reports on Form 10-Q for DTE Energy Company and The Detroit Edison
Company:
Item 6 - Exhibits and Reports on Form 8-K...................................................27
Signature Page to DTE Energy Company Quarterly Report on Form 10-Q............................................35
Signature Page to The Detroit Edison Company Quarterly Report on Form 10-Q....................................36
</TABLE>
2
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DEFINITIONS
<TABLE>
<CAPTION>
<S> <C>
ABATE............................Association of Businesses Advocating Tariff Equity
Annual Report....................1998 Annual Report to the Securities and Exchange Commission on Form 10-K for
DTE Energy Company or The Detroit Edison Company, as the case may be
Annual Report Notes..............Notes to Consolidated Financial Statements appearing on pages 45 through 72
and 76 through 79 of the 1998 Annual Report to the Securities and Exchange
Commission on Form 10-K for DTE Energy Company and The Detroit Edison Company,
as the case may be
Company..........................DTE Energy Company and Subsidiary Companies
Detroit Edison...................The Detroit Edison Company (a wholly owned subsidiary of DTE Energy Company) and
Subsidiary Companies
Direct Access....................Gives all retail customers equal opportunity to utilize the transmission system
which results in access to competitive generation resources
DTE Capital......................DTE Capital Corporation (a wholly owned subsidiary of DTE Energy Company)
EPA..............................United States Environmental Protection Agency
FERC.............................Federal Energy Regulatory Commission
kWh..............................Kilowatthour
MPSC.............................Michigan Public Service Commission
MW...............................Megawatt
MWh..............................Megawatthour
Note(s)..........................Note(s) to Condensed Consolidated Financial Statements (Unaudited) appearing herein
PSCR.............................Power Supply Cost Recovery
Registrant.......................Company or Detroit Edison, as the case may be
</TABLE>
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QUARTERLY REPORT ON FORM 10-Q FOR DTE ENERGY COMPANY
PART I - FINANCIAL INFORMATION
ITEM 1 - CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED).
The following condensed consolidated financial statements (unaudited) are
included herein.
Page
----
DTE Energy Company:
Condensed Consolidated Statement of Income...................................5
Condensed Consolidated Balance Sheet.........................................6
Condensed Consolidated Statement of Cash Flows...............................8
Condensed Consolidated Statement of Changes in Shareholders' Equity..........9
The Detroit Edison Company:
Condensed Consolidated Statement of Income..................................11
Condensed Consolidated Balance Sheet........................................12
Condensed Consolidated Statement of Cash Flows..............................14
Condensed Consolidated Statement of Changes in Shareholder's Equity.........15
Notes to Condensed Consolidated Financial Statements (Unaudited)..............16
Independent Accountants' Report...............................................19
Note: Detroit Edison's Condensed Consolidated Financial Statements are
presented here for ease of reference and are not considered to be
part of Item I of the Company's report.
4
<PAGE> 5
DTE ENERGY COMPANY
CONDENSED CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)
(Millions, Except Per Share Amounts)
<TABLE>
<CAPTION>
Three Months Ended
March 31
-----------------------------
1999 1998
------------ -----------
<S> <C> <C>
OPERATING REVENUES $1,024 $ 945
------ ------
OPERATING EXPENSES
Fuel and purchased power 231 208
Operation and maintenance 325 268
Depreciation and amortization 182 165
Taxes other than income 71 71
------ ------
Total Operating Expenses 809 712
------ ------
OPERATING INCOME 215 233
------ ------
INTEREST EXPENSE AND OTHER
Interest expense 83 74
Preferred stock dividends of subsidiary - 3
Other - net 3 -
------ ------
Total Interest Expense and Other 86 77
------ ------
INCOME BEFORE INCOME TAXES 129 156
INCOME TAXES 14 52
------ ------
NET INCOME $ 115 $ 104
====== ======
AVERAGE COMMON SHARES OUTSTANDING 145 145
------ ------
EARNINGS PER COMMON SHARE - BASIC AND DILUTED $ 0.79 $ 0.72
------ ------
</TABLE>
See Notes to Condensed Consolidated Financial Statements (Unaudited).
5
<PAGE> 6
DTE ENERGY COMPANY
CONDENSED CONSOLIDATED BALANCE SHEET (UNAUDITED)
(Millions, Except Per Share Amounts and Shares)
<TABLE>
<CAPTION>
March 31 December 31
1999 1998
--------------- ---------------
<S> <C> <C>
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 41 $ 130
Restricted cash 132 121
Accounts receivable
Customer (less allowance for doubtful accounts of $20) 322 316
Accrued unbilled revenues 143 153
Other 117 135
Inventories (at average cost)
Fuel 161 171
Materials and supplies 152 167
Other 136 39
------- -------
1,204 1,232
------- -------
INVESTMENTS
Nuclear decommissioning trust funds 327 309
Other 247 261
------- -------
574 570
------- -------
PROPERTY
Property, plant and equipment 11,224 11,121
Property under capital leases 241 242
Nuclear fuel under capital lease 662 659
Construction work in progress 198 156
------- -------
12,325 12,178
------- -------
Less accumulated depreciation and amortization 5,336 5,235
------- -------
6,989 6,943
------- -------
REGULATORY ASSETS 3,022 3,091
------- -------
OTHER ASSETS 264 252
------- -------
TOTAL ASSETS $12,053 $12,088
======= =======
</TABLE>
See Notes to Condensed Consolidated Financial Statements (Unaudited).
6
<PAGE> 7
<TABLE>
<CAPTION>
March 31 December 31
1999 1998
--------------- --------------
<S> <C> <C>
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable $ 187 $ 239
Accrued interest 54 57
Dividends payable 75 75
Accrued payroll 87 101
Short-term borrowings 280 231
Deferred income taxes 100 60
Current portion long-term debt 481 294
Current portion capital leases 109 118
Other 151 217
------- -------
1,524 1,392
------- -------
OTHER LIABILITIES
Deferred income taxes 1,846 1,888
Capital leases 124 126
Regulatory Liabilities 322 294
Other 517 493
------- -------
2,809 2,801
------- -------
LONG-TERM DEBT 3,984 4,197
------- -------
SHAREHOLDERS' EQUITY
Common stock, without par value, 400,000,000 shares
authorized, 145,045,159 and 145,071,317 issued
and outstanding, respectively 1,950 1,951
Retained earnings 1,786 1,747
------- -------
3,736 3,698
------- -------
CONTINGENCIES (NOTE 5)
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $12,053 $12,088
======= =======
</TABLE>
See Notes to Condensed Consolidated Financial Statements (Unaudited).
7
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DTE ENERGY COMPANY
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)
(Millions)
<TABLE>
<CAPTION>
Three Months Ended
March 31
------------------------
1999 1998
------------------------
<S> <C> <C>
OPERATING ACTIVITIES
Net Income $ 115 $ 104
Adjustments to reconcile net income to net cash from operating activities:
Depreciation and amortization 182 165
Other 48 3
Changes in current assets and liabilities:
Restricted cash (11) (16)
Accounts receivable 22 47
Inventories 25 12
Payables (50) 5
Other (175) (97)
- ------------------------------------------------------------------------------------------------------
Net cash from operating activities 156 223
- ------------------------------------------------------------------------------------------------------
INVESTING ACTIVITIES
Plant and equipment expenditures (162) (125)
Investment in coke oven battery businesses - (200)
Nuclear decommissioning trust funds (18) (29)
Other (2) 6
- ------------------------------------------------------------------------------------------------------
Net cash used for investing activities (182) (348)
- ------------------------------------------------------------------------------------------------------
FINANCING ACTIVITIES
Increase in short-term borrowings 49 377
Redemption of long-term debt (37) (169)
Dividends on common stock (75) (75)
- ------------------------------------------------------------------------------------------------------
Net cash (used for) from financing activities (63) 133
- ------------------------------------------------------------------------------------------------------
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS (89) 8
CASH AND CASH EQUIVALENTS AT BEGINNING OF THE PERIOD 130 45
- ------------------------------------------------------------------------------------------------------
CASH AND CASH EQUIVALENTS AT END OF THE PERIOD $ 41 $ 53
======================================================================================================
SUPPLEMENTARY CASH FLOW INFORMATION
Interest paid (excluding interest capitalized) $ 84 $ 85
Income taxes paid 29 20
New capital lease obligations 9 17
</TABLE>
See Notes to the Condensed Consolidated Financial Statements (Unaudited).
8
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DTE ENERGY COMPANY
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY (UNAUDITED)
(Millions, Except Per Share Amounts; Shares in Thousands)
<TABLE>
<CAPTION>
1999
--------------------------------
Shares Amount
--------------------------------
<S> <C> <C>
COMMON STOCK
Balance at beginning of year 145,071 $ 1,951
Repurchase and retirement of common stock (26) (1)
-------- ----------
Balance at March 31, 1999 145,045 $ 1,950
- --------------------------------------------------------------------------------------------------------------
RETAINED EARNINGS
Balance at beginning of year $ 1,747
Net income 115
Dividends declared on common stock ($0.515 per share) (75)
Repurchase and retirement of common stock (1)
----------
Balance at March 31, 1999 $ 1,786
- --------------------------------------------------------------------------------------------------------------
TOTAL SHAREHOLDERS' EQUITY $ 3,736
==============================================================================================================
</TABLE>
See Notes to Condensed Consolidated Financial Statements (Unaudited).
9
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[This page intentionally left blank.]
10
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THE DETROIT EDISON COMPANY
CONDENSED CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)
(Millions)
<TABLE>
<CAPTION>
Three Months Ended
March 31
-----------------------------------
1999 1998
--------------- ---------------
<S> <C> <C>
OPERATING REVENUES $911 $901
---- ----
OPERATING EXPENSES
Fuel and purchased power 206 208
Operation and maintenance 237 223
Depreciation and amortization 173 163
Taxes other than income 71 70
---- ----
Total Operating Expenses 687 664
---- ----
OPERATING INCOME 224 237
---- ----
INTEREST EXPENSE AND OTHER
Interest expense 68 68
Other - net 3 5
---- ----
Total Interest Expense and Other 71 73
---- ----
INCOME BEFORE INCOME TAXES 153 164
INCOME TAXES 49 66
---- ----
NET INCOME 104 98
PREFERRED STOCK DIVIDENDS - 3
---- ----
NET INCOME AVAILABLE FOR COMMON STOCK $104 $ 95
==== ====
</TABLE>
See Notes to Condensed Consolidated Financial Statements (Unaudited).
11
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THE DETROIT EDISON COMPANY
CONDENSED CONSOLIDATED BALANCE SHEET (UNAUDITED)
(Millions, Except Per Share Amounts and Shares)
<TABLE>
<CAPTION>
March 31 December 31
1999 1998
-------------- ---------------
<S> <C> <C>
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 3 $ 5
Accounts receivable
Customer (less allowance for doubtful
accounts of $20) 302 307
Accrued unbilled revenues 143 153
Other 73 90
Inventories (at average cost)
Fuel 161 171
Materials and supplies 139 138
Other 115 21
------- -------
936 885
------- -------
INVESTMENTS
Nuclear decommissioning trust funds 327 309
Other 42 74
------- -------
369 383
------- -------
PROPERTY
Property, plant and equipment 10,694 10,610
Property under capital leases 240 242
Nuclear fuel under capital lease 662 659
Construction work in progress 143 118
------- -------
11,739 11,629
------- -------
Less accumulated depreciation and amortization 5,293 5,201
------- -------
6,446 6,428
------- -------
REGULATORY ASSETS 3,022 3,091
------- -------
OTHER ASSETS 212 200
------- -------
TOTAL ASSETS $10,985 $10,987
======= =======
</TABLE>
See Notes to Condensed Consolidated Financial Statements (Unaudited).
12
<PAGE> 13
<TABLE>
<CAPTION>
March 31 December 31
1999 1998
------------- --------------
<S> <C> <C>
LIABILITIES AND SHAREHOLDER'S EQUITY
CURRENT LIABILITIES
Accounts payable $ 172 $ 211
Accrued interest 45 54
Dividends payable 80 80
Accrued payroll 85 86
Short-term borrowings 280 231
Deferred income taxes 100 60
Current portion long-term debt 394 219
Current portion capital leases 109 118
Other 120 203
-------- --------
1,385 1,262
-------- --------
OTHER LIABILITIES
Deferred income taxes 1,800 1,846
Capital leases 124 126
Regulatory liabilities 322 294
Other 549 484
-------- --------
2,795 2,750
-------- --------
LONG-TERM DEBT 3,268 3,462
-------- --------
SHAREHOLDER'S EQUITY
Common stock, $10 par value, 400,000,000 shares
authorized, 145,119,875 issued and outstanding 1,451 1,451
Premium on common stock 548 548
Common stock expense (48) (48)
Retained earnings 1,586 1,562
-------- --------
3,537 3,513
-------- --------
CONTINGENCIES (NOTE 5)
TOTAL LIABILITIES AND SHAREHOLDER'S EQUITY $ 10,985 $ 10,987
======== ========
</TABLE>
See Notes to Condensed Consolidated Financial Statements (Unaudited).
13
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THE DETROIT EDISON COMPANY
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)
(Millions)
<TABLE>
<CAPTION>
Three Months Ended
March 31
-----------------------------
1999 1998
-----------------------------
<S> <C> <C>
OPERATING ACTIVITIES
Net Income $ 104 $ 98
Adjustments to reconcile net income to net cash from operating activities:
Depreciation and amortization 173 163
Other 65 (1)
Changes in current assets and liabilities:
Accounts receivable 33 54
Inventories 16 2
Payables (43) 22
Other (178) (108)
- ----------------------------------------------------------------------------------------------------------------
Net cash from operating activities 170 230
- ----------------------------------------------------------------------------------------------------------------
INVESTING ACTIVITIES
Plant and equipment expenditures (125) (118)
Nuclear decommissioning trust funds (18) (29)
Other 21 (3)
- ----------------------------------------------------------------------------------------------------------------
Net cash used for investing activities (122) (150)
- ----------------------------------------------------------------------------------------------------------------
FINANCING ACTIVITIES
Increase in short-term borrowings 49 164
Redemption of long-term debt (19) (169)
Dividends on common stock and preferred stock (80) (83)
- ----------------------------------------------------------------------------------------------------------------
Net cash used for financing activities (50) (88)
- ----------------------------------------------------------------------------------------------------------------
NET DECREASE IN CASH AND CASH EQUIVALENTS (2) (8)
CASH AND CASH EQUIVALENTS AT BEGINNING OF THE PERIOD 5 15
- ----------------------------------------------------------------------------------------------------------------
CASH AND CASH EQUIVALENTS AT END OF THE PERIOD $ 3 $ 7
================================================================================================================
SUPPLEMENTARY CASH FLOW INFORMATION
Interest paid (excluding interest capitalized) $ 78 $ 79
Income taxes paid 26 26
New capital lease obligations 9 17
</TABLE>
See Notes to Condensed Consolidated Financial Statements (Unaudited).
14
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THE DETROIT EDISON COMPANY
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDER'S EQUITY (UNAUDITED)
(Millions, Except Per Share Amounts; Shares in Thousands)
<TABLE>
<CAPTION>
1999
----------------------------------
Shares Amount
----------------------------------
<S> <C> <C>
COMMON STOCK
Balance at beginning of year 145,120 $ 1,451
------- --------------
Balance at March 31, 1999 145,120 $ 1,451
- ------------------------------------------------------------------------------------------------------------------
PREMIUM ON COMMON STOCK
Balance at beginning of year $ 548
--------------
Balance at March 31, 1999 $ 548
- ------------------------------------------------------------------------------------------------------------------
COMMON STOCK EXPENSE
Balance at beginning of year $ (48)
--------------
Balance at March 31, 1999 $ (48)
- ------------------------------------------------------------------------------------------------------------------
RETAINED EARNINGS
Balance at beginning of year $ 1,562
Net income 104
Dividends declared on common stock ($0.55 per share) (80)
--------------
Balance at March 31, 1999 $ 1,586
- ------------------------------------------------------------------------------------------------------------------
TOTAL SHAREHOLDER'S EQUITY $ 3,537
==================================================================================================================
</TABLE>
See Notes to Condensed Consolidated Financial Statements (Unaudited).
15
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NOTES TO CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS (UNAUDITED)
DTE ENERGY COMPANY AND THE DETROIT EDISON COMPANY
NOTE 1 - ANNUAL REPORT NOTES
These condensed consolidated financial statements (unaudited) should be read in
conjunction with the Annual Report Notes. The Notes contained herein update and
supplement matters discussed in the Annual Report Notes.
The preparation of the financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
The condensed consolidated financial statements are unaudited, but in the
opinion of the Company and Detroit Edison, with respect to its own financial
statements, include all adjustments necessary for a fair statement of the
results for the interim periods. Financial results for this interim period are
not necessarily indicative of results that may be expected for any other interim
period or for the fiscal year.
NOTE 2 - REGULATORY MATTERS
On March 8, 1999 the MPSC issued orders clarifying several issues related to
Direct Access. Among other things, the MPSC ruled that:
- - Detroit Edison must reduce rates effective January 1, 2000 by $14.8 million
to reflect the expiration of the 2-year extraordinary storm damage
surcharge.
- - Detroit Edison will be required to use its "best efforts" to provide
standby service to Direct Access customers. Best efforts means that Detroit
Edison must make the service available to Direct Access customers who
request it, but Detroit Edison does not have to build or purchase new
capacity or interrupt firm customers to provide the service.
- - Standby service is to be priced at Detroit Edison's top incremental cost
plus 1 cent. The service must be contracted for and scheduled in advance.
There are no reservation charges or monthly fees.
- - Detroit Edison should move expeditiously on the 90 MW of Direct Access
pilot program, but the larger 675 MW block of Direct Access power should
not become effective until the third quarter of 1999.
- - DTE Energy affiliates may not participate in Direct Access until Detroit
Edison files a code of conduct with the MPSC. On April 12, 1999, Detroit
Edison filed a code of conduct with the MPSC.
Several parties have filed petitions for rehearing or clarification of some of
the March 8, 1999 orders; the MPSC has not ruled on these petitions. ABATE and
the Michigan Attorney General have also filed for leave to appeal the MPSC's
decision authorizing accelerated
16
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amortization of Detroit Edison's Fermi 2 assets, to the Michigan Court of
Appeals. Detroit Edison is unable to determine the timing or outcome of these
proceedings.
NOTE 3 - SHORT-TERM CREDIT ARRANGEMENTS AND BORROWINGS
At March 31, 1999, Detroit Edison had total short-term credit arrangements of
approximately $690 million under which $280 million of commercial paper was
outstanding.
At March 31, 1999, DTE Capital had short-term credit arrangements of $400
million, backed by a Support Agreement from the Company, under which no amounts
were outstanding.
In February 1999, the Company entered into a $40 million Support Agreement with
DTE Capital for the purpose of DTE Capital's credit enhancing activities on
behalf of DTE Energy affiliates.
NOTE 4 - SEGMENT AND RELATED INFORMATION
Effective December 31, 1998, the Company adopted Statement of Financial
Accounting Standards No. 131, "Disclosure about Segments of an Enterprise and
Related Information." The Company's reportable business segment is its electric
utility, Detroit Edison, which is engaged in the generation, purchase,
transmission, distribution and sale of electric energy in a 7,600 square mile
area in Southeastern Michigan. All other includes non-regulated energy-related
businesses and services, which develop and manage electricity and other
energy-related projects, and engage in domestic energy trading and marketing.
Inter-segment revenues are not material. Financial data for business segments
are as follows:
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------
Reconciliations
Electric All and
Utility Other Eliminations Consolidated
- -----------------------------------------------------------------------------------------------------------------
Three Months Ended March 31, 1999 (Millions)
<S> <C> <C> <C> <C>
Operating revenues $ 911 $ 113 $ - $ 1,024
Net income 104 14 (3) 115
- -----------------------------------------------------------------------------------------------------------------
Three Months Ended March 31, 1998 (Millions)
Operating revenues $ 901 $ 44 $ - $ 945
Net income 95 9 - 104
- -----------------------------------------------------------------------------------------------------------------
</TABLE>
NOTE 5- CONTINGENCIES
LEGAL PROCEEDINGS - Detroit Edison and plaintiffs in a class action pending in
the Circuit Court for Wayne County, Michigan (Gilford, et al v. Detroit Edison),
as well as plaintiffs in two other pending actions which make class claims
(Sanchez, et al v. Detroit
17
<PAGE> 18
Edison, Circuit Court for Wayne County, Michigan; and Frazier v. Detroit Edison,
United States District Court, Eastern District of Michigan), are preparing for
binding arbitration to settle these matters. A July 1998 Consent Judgement has
received preliminary Court approval. A Fairness Hearing with respect to the
terms of the settlement was held in August 1998, and no objections to the
settlement were raised. A second Fairness Hearing is contemplated following the
results of the arbitration. The settlement agreement provides that Detroit
Edison's monetary liability is to be no less than $17.5 million and no greater
than $65 million after the conclusion of all related proceedings. Detroit Edison
has accrued an amount considered to be probable.
--------------------------
This Quarterly Report on Form 10-Q, including the report of Deloitte & Touche
LLP (on page 19) will automatically be incorporated by reference in the
Prospectuses constituting part of the Registration Statements on Form S-3
(Registration Nos. 33-53207, 33-64296 and 333-65765) of The Detroit Edison
Company and Form S-8 (Registration No. 333-00023) and Form S-3 (Registration No.
33-57545) of DTE Energy Company, filed under the Securities Act of 1933. Such
report of Deloitte & Touche LLP, however, is not a "report" or "part of the
Registration Statement" within the meaning of Sections 7 and 11 of the
Securities Act of 1933 and the liability provisions of Section 11(a) of such Act
do not apply.
18
<PAGE> 19
INDEPENDENT ACCOUNTANTS' REPORT
To the Board of Directors and Shareholders of DTE Energy Company and
The Detroit Edison Company
We have reviewed the accompanying condensed consolidated balance sheets of DTE
Energy Company and subsidiaries and of The Detroit Edison Company and
subsidiaries as of March 31, 1999, and the related condensed consolidated
statements of income and cash flows for the three-month periods ended March 31,
1999 and 1998, and the condensed consolidated statements of changes in
shareholders' equity for the three-month period ended March 31, 1999. These
financial statements are the responsibility of DTE Energy Company's management
and of The Detroit Edison Company's management.
We conducted our reviews in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures to
financial data and of making inquiries of persons responsible for financial and
accounting matters. It is substantially less in scope than an audit conducted in
accordance with generally accepted auditing standards, the objective of which is
the expression of an opinion regarding the financial statements taken as a
whole. Accordingly, we do not express such an opinion.
Based on our reviews, we are not aware of any material modifications that should
be made to such condensed consolidated financial statements for them to be in
conformity with generally accepted accounting principles.
We have previously audited, in accordance with generally accepted auditing
standards, the consolidated balance sheets of DTE Energy Company and
subsidiaries and of The Detroit Edison Company and subsidiaries as of December
31, 1998, and the related consolidated statements of income, changes in
shareholders' equity, and cash flows for the year then ended (not presented
herein); and in our report dated January 27, 1999, we expressed an unqualified
opinion on those consolidated financial statements. In our opinion, the
information set forth in the accompanying condensed consolidated balance sheets
as of December 31, 1998 is fairly stated, in all material respects, in relation
to the consolidated balance sheets from which it has been derived.
DELOITTE & TOUCHE LLP
Detroit, Michigan
April 28, 1999
19
<PAGE> 20
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS.
This analysis for the three months ended March 31, 1999, as compared to the same
period in 1998, should be read in conjunction with the condensed consolidated
financial statements (unaudited), the accompanying Notes, and the Annual Report
Notes.
Detroit Edison is the principal operating subsidiary of the Company and, as
such, unless otherwise identified, this discussion explains material changes in
results of operations of both the Company and Detroit Edison and identifies
recent trends and events affecting both the Company and Detroit Edison.
ELECTRIC INDUSTRY RESTRUCTURING
MICHIGAN PUBLIC SERVICE COMMISSION
On March 8, 1999, the MPSC initiated new dockets to 1) evaluate the need to
expedite the supplier licensing program as an alternative for suppliers to
obtain local franchises and Certificates of Public Convenience and Necessity
from the MPSC, and 2) to establish guidelines for transactions between
affiliates. The MPSC also set for hearing the ABATE complaint that had been
filed in August 1997 alleging that Detroit Edison's earnings are excessive. A
procedural schedule was set whereby an order could be issued in the first
quarter of 2000.
On March 31, 1999, Detroit Edison filed an application with the MPSC for true-up
of its stranded costs, including Direct Access implementation costs. Detroit
Edison requested that the proceedings be conducted in two phases. The first
phase should involve only a prudency review of incurred implementation costs,
approval of forecasted spending and allocation of implementation costs among
customers and the timing of cost recovery. The second phase should be structured
to address the remaining true-up issues; including the appropriate stranded cost
balances, the appropriate level of the transition charge, the establishment of
the mechanics of the true-up and stranded cost recovery processes, and to
address policy issues such as Detroit Edison's billing and metering rights and
obligations in a restructured electric utility industry. Expedited proceedings
were requested for both phases, and a procedural schedule will be determined in
May 1999.
FEDERAL ENERGY REGULATORY COMMISSION
On February 15, 1999, Detroit Edison submitted a request to the FERC for
authorization to use certain plant accounts to recognize the impairment loss of
Detroit Edison's Fermi 2 plant and associated assets in accordance with
generally accepted accounting principles. On March 26, 1999, the Michigan
Attorney General filed a protest with the FERC and requested that the FERC set
the issue for hearing. On April 12, 1999, Detroit Edison filed its response with
the FERC, requesting that the FERC reject the Michigan Attorney General's
protest as an improper collateral attack on MPSC orders. The FERC has not made a
ruling on these matters.
20
<PAGE> 21
LIQUIDITY AND CAPITAL RESOURCES
CASH FROM OPERATING ACTIVITIES
Net cash from operating activities decreased in 1999 due primarily to decreases
in accounts payable and changes in other current assets and liabilities.
CASH USED FOR INVESTING ACTIVITIES
Net cash used for investing was lower due primarily to decreased non-regulated
investments and contributions to the nuclear decommissioning trust funds.
CASH (USED FOR) FROM FINANCING ACTIVITIES
Net cash used for financing was $63 million for the three months ended March 31,
1999 compared to net cash from financing of $133 million for the same period
during 1998. This fluctuation was primarily due to decreased DTE Capital
short-term borrowings, partially offset by redemptions of long-term debt.
YEAR 2000
The Company and Detroit Edison have been involved in an enterprise-wide program
to address Year 2000 issues. A program office was established in mid-1997 to
implement a rigorous plan to address the impact of Year 2000 on hardware and
software systems, embedded systems (which include microprocessors used in the
production and control of electric power), and critical service providers. The
emphasis has been on mission critical systems that support core business
activities or processes. Core business activities/processes include safety,
environmental and regulatory compliance, product production and delivery,
revenue collection, employee and supplier payment and financial asset
management.
The plan for addressing Year 2000 is divided into several phases including
raising general awareness of Year 2000 throughout the Company and Detroit
Edison; maintaining an inventory of systems and devices; performing an
assessment of inventoried systems and devices; performing compliance testing of
suspect systems and devices; remediation of non-compliant systems and devices
through replacement, repair, retirement, or identifying an acceptable work
around; testing and remediation of systems and devices in an integrated
environment and preparing business continuity plans.
Inventory, assessment and compliance testing phases have been completed for
known systems and devices. The remediation phase is approximately 91% complete
and is expected to be fully complete by August 1999 for mission critical assets
and supporting assets. Integration planning, including the mapping of critical
business processes, is near completion for Detroit Edison. Integration testing
and contingency planning is approximately 18% complete and is expected to be
fully complete by October 1999.
To support the program phases, the program office has been working with major
utility industry associations and organizations, customers and vendors to gather
and share
21
<PAGE> 22
information on Year 2000 issues. The program office has contacted vendors
critical to Company operations to determine their progress on Year 2000.
To further assist in identifying potential problems, tests of generating
facilities have been conducted by advancing control systems dates to the Year
2000. Results of these tests have shown that the generating facilities operated
successfully in this induced "millennium mode." Exercises were conducted on
December 31, 1998 and January 1, 1999 to assess the ability to reach employees
and the regional security centers of the East Central Area Reliability Group
through various communication channels. The exercised communication channels
operated properly. The business continuity program will provide opportunities to
conduct similar exercises on other systems in advance of the Year 2000. Similar
analysis has not been completed for other affiliates.
In the event that an unknown Year 2000 condition adversely affects service to
customers or an internal business process, contingency and business continuity
plans and procedures are being developed to provide rapid restoration to normal
conditions. The Company and Detroit Edison have always maintained a
comprehensive operational emergency response plan. The business continuity
function of the Year 2000 program will supplement the existing emergency plan to
include Year 2000 specific events. A Year 2000 emergency response office will be
fully operational by November 1999 to manage and coordinate operations,
including mobilization of all employees as necessary, during the transition to
the new millennium.
The Company and Detroit Edison believe that with all Year 2000 modifications,
business continuity and emergency management plans in place, the Year 2000 will
not have a material effect on their financial position, liquidity and results of
operations. Despite all efforts, there can be no assurances that Year 2000
issues can be totally eliminated. Results of modifications and testing done
during the fourth quarter of 1998 have demonstrated that Detroit Edison should
be able to maintain normal operating conditions into the Year 2000, although
there may be isolated electric service interruptions. Detroit Edison's internal
business systems may be affected by a Year 2000 related failure that could
temporarily interrupt the ability to communicate with customers, collect
revenue, or complete cash transactions. In addition, no assurances can be given
that the systems of vendors, interconnected utilities and customers will not
result in Year 2000 problems.
The Company estimates that Year 2000 costs will approximate $80 million
with $57 million expended through March 31, 1999. Operating cash flow is
expected to be sufficient to pay Year 2000 modification costs with no material
impact on operating results or cash flows.
RESULTS OF OPERATIONS
For the three months ended March 31, 1999, the Company's net income was $115
million, or $0.79 per common share as compared to $104 million, or $0.72 per
common share earned in the three months ended March 31, 1998.
22
<PAGE> 23
The 1999 three-month earnings were higher than 1998 due to increased earnings
resulting from increased utilization of tax credits generated by non-regulated
businesses and increased electric system sales due to higher demand resulting
from colder weather.
OPERATING REVENUES
Increases in operating revenues were due primarily to higher non-regulated
subsidiary revenues, higher system and interconnection sales due to increased
heating load and usage, partially offset by decreases in total system revenues
driven mainly by lower rates.
Detroit Edison kWh sales increased (decreased) as compared to the prior year as
follows:
Three
Months
------
Residential 5.2 %
Commercial 3.8
Industrial 0.4
Other (includes primarily sales for resale) 11.2
Total System 3.6
Sales between utilities (21.5)
Total 0.9
The increase in residential sales resulted from more heating related demand and
growth in the customer base. Commercial sales increased for the three-month
period, reflecting more heating related demand and a continuation
of favorable economic conditions. Sales to other customers increased reflecting
increased demand from sales for resale customers. Sales between utilities
decreased due to less power available for sale.
OPERATING EXPENSES
FUEL AND PURCHASED POWER
Net system output and average fuel and purchased power unit costs were as
follows:
Three Months
-----------------------
1999 1998
---- ----
(Thousands of MWh)
Power plant generation
Fossil 10,474 11,043
Nuclear 2,399 1,983
Purchased power 1,331 966
--------- ---------
Net system output 14,024 13,992
========= =========
Average unit cost ($/MWh) $ 13.49 $ 13.54
========= =========
23
<PAGE> 24
Fuel and purchased power expense increased for the Company due primarily to new
non-regulated subsidiary expenses. Detroit Edison fuel and purchased power
expense decreased due to an 18.3% reduction in steam heating sales and lower
average unit costs resulting from a decrease in the cost of nuclear fuel,
partially offset by higher net system output and increased purchases of higher
cost power to replace lower cost system generation as a result of plant outages.
OPERATION AND MAINTENANCE
Operation and maintenance expense for the Company increased due primarily to new
non-regulated subsidiary operation expense ($44 million), higher expenses
related to the timing of the periodic plant outages ($8.3 million), higher
expenses for Year 2000 testing and remediation ($7.9 million), higher expenses
for information systems ($2.4 million), partially offset by lower nuclear
generation expenses ($5.9 million).
INCOME TAXES
Income tax expense for the Company decreased in 1999 due primarily to increased
utilization of alternate fuels credits generated from non-regulated businesses.
Alternate fuels credits phase out beginning in 2003 through 2007.
FORWARD-LOOKING STATEMENTS
Certain information presented herein is based on the expectations of the Company
and Detroit Edison, and, as such, is forward-looking. The Private Securities
Litigation Reform Act of 1995 encourages reporting companies to provide analyses
and estimates of future prospects and also permits reporting companies to point
out that actual results may differ from those anticipated.
Actual results for the Company and Detroit Edison may differ from those expected
due to a number of variables including, but not limited to, weather, actual
sales, the effects of competition and the phased-in implementation of Direct
Access, the implementation of utility restructuring in Michigan (which involves
pending regulatory proceedings, possible legislative activity, and the recovery
of stranded costs), environmental (including proposed regulations to limit
nitrogen oxide emissions) and nuclear requirements, the impact of FERC
proceedings and regulations, the success of non-regulated lines of business and
the timely completion of Year 2000 modifications. While the Company and Detroit
Edison believe that estimates given accurately measure the expected outcome,
actual results could vary materially due to the variables mentioned as well as
others. This discussion contains a Year 2000 readiness disclosure.
24
<PAGE> 25
QUARTERLY REPORT ON FORM 10-Q FOR
THE DETROIT EDISON COMPANY
PART I - FINANCIAL INFORMATION
ITEM 1 - CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED).
See pages 11 through 15.
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS.
See the Company's and Detroit Edison's "Item 2 - Management's Discussion and
Analysis of Financial Condition and Results of Operations," which is
incorporated herein by this reference.
PART II - OTHER INFORMATION
ITEM 1 - LEGAL PROCEEDINGS.
In a lawsuit filed in January 1999 in the Circuit Court for Wayne County
Michigan (Cook, et al v. Detroit Edison), a number of individual plaintiffs have
claimed employment-related sex, gender and race discrimination, as well as
harassment. The suit seeks certification as a class action. Detroit Edison
believes the claims are without merit.
As discussed in "Part I, Item 1 - Business" in the Company's Annual Report, in
1998 Detroit Edison attempted to restart the Conners Creek Power Plant (in
reserve status from 1988 to 1998) to meet expected high summer demand for
electricity. Although Detroit Edison believed that the plant complied with all
applicable environmental requirements, several regulatory agencies contended
that Detroit Edison was required to obtain a series of new permits prior to
plant operation and issued notices of violation. In August 1998, Detroit Edison
filed suit seeking a review of the agencies' determinations. On January 11,
1999, the Department of Justice (DOJ) on behalf of the EPA sent Detroit Edison a
Demand Letter requiring the payment of $2.3 million in civil penalties and an
unconditional commitment to abandon the use of the facility as a coal plant.
Detroit Edison rejected the demand and on January 15, 1999 the DOJ/EPA filed
suit in United States District Court for the Eastern District of Michigan. An
interim order issued on March 11, 1999 required Detroit Edison to convert the
plant from a coal to a natural gas fired facility. The ruling is the preliminary
outcome of the lawsuit filed by Detroit Edison seeking resolution of the
regulatory issues challenging any use of the plant. The operation of the plant
by early summer 1999 was found to be necessary to protect the health, safety and
welfare of the people of the Detroit metropolitan area. Resolution of the
remaining issues is proceeding. The cost of the conversion is estimated at $11
million. It is impossible to predict what impact, if any, the final outcome of
this will have upon Detroit Edison.
25
<PAGE> 26
ITEM 5 - OTHER INFORMATION.
On March 31, 1999, Detroit Edison filed for reconciliation of its MPSC
jurisdictional 1998 PSCR revenues and expenses. Detroit Edison indicated that an
under recovery of $45.5 million, including interest, existed, and when offset by
a Fermi 2 performance standard credit of $33.7 million, a net amount of $11.8
million remains to be collected from PSCR customers.
26
<PAGE> 27
QUARTERLY REPORTS ON FORM 10-Q FOR
DTE ENERGY COMPANY AND THE DETROIT EDISON COMPANY
ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibits
(i) Exhibits filed herewith.
Exhibit
Number
------
3-11 Bylaws of DTE Energy Company, as amended through
April 28,1999.
3-12 Bylaws of The Detroit Edison Company, as amended through
April 28, 1999.
4-202 $40,000,000 Support Agreement dated as of
February 24, 1999 between DTE Energy Company and DTE Capital
Corporation.
*10-32 1999 Shareholder Value Improvement Plan-A Measures.
*10-33 1999 Executive Incentive Plan Measures.
11-15 - DTE Energy Company Basic and Diluted Earnings Per Share of
Common Stock.
12-16 - DTE Energy Company Computation of Ratio of Earnings to Fixed
Charges.
12-17 - The Detroit Edison Company Computation of Ratio of Earnings
to Fixed Charges.
15-10 - Awareness Letter of Deloitte & Touche LLP regarding their
report dated April 28, 1999.
27-27 - Financial Data Schedule for the period ended March 31, 1999
for DTE Energy Company.
27-28 - Financial Data Schedule for the period ended March 31, 1999
for The Detroit Edison Company.
(ii) Exhibits incorporated herein by reference.
3(a) - Amended and Restated Articles of Incorporation of DTE
Energy Company, dated December 13, 1995. (Exhibit 3-5 to
Form 10-Q for quarter ended September 30, 1997)
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<PAGE> 28
3(b) - Certificate of Designation of Series A Junior
Participating Preferred Stock of DTE Energy Company.
Exhibit 3-6 to Form 10-Q for quarter ended September
30, 1997.)
3(c) - Restated Articles of Incorporation of Detroit Edison,
as filed December 10, 1991 with the State of Michigan,
Department of Commerce - Corporation and Securities
Bureau (Exhibit 4-117 to Form 10-Q for quarter ended
March 31, 1993).
3(d) - Certificate containing resolution of the Detroit
Edison Board of as filed February 22, 1993 with the
State of Michigan, Department of Commerce - Corporation
and Securities Bureau (Exhibit 4-134 to Form 10-Q for
quarter ended March 31, 1993).
3(e) - Certificate containing resolution of the Detroit
Edison Board of Directors establishing the Cumulative
Preferred Stock, 7.74% Series, as filed April 21, 1993
with the State of Michigan, Department of Commerce -
Corporation and Securities Bureau (Exhibit 4-140 to
Form 10-Q for quarter ended March 31, 1993).
3(f) - Rights Agreement, dated as of September 23, 1997, by
and between DTE Energy Company and The Detroit Edison
Company, as Rights Agent (Exhibit 4-1 to DTE Energy
Company Current Report on Form 8-K, dated September 23,
1997).
3(g) - Agreement and Plan of Exchange (Exhibit 1(2) to DTE
Energy Form 8-B filed January 2, 1996, File No.
1-11607).
4(a) - Mortgage and Deed of Trust, dated as of October 1,
1924, between Detroit Edison (File No. 1-2198) and
Bankers Trust Company as Trustee (Exhibit B-1 to
Registration No. 2-1630) and indentures supplemental
thereto, dated as of dates indicated below, and filed
as exhibits to the filings as set forth below:
<TABLE>
<S> <C>
September 1, 1947 Exhibit B-20 to Registration No. 2-7136
October 1, 1968 Exhibit 2-B-33 to Registration No. 2-30096
November 15, 1971 Exhibit 2-B-38 to Registration No. 2-42160
January 15, 1973 Exhibit 2-B-39 to Registration No. 2-46595
June 1, 1978 Exhibit 2-B-51 to Registration No. 2-61643
June 30, 1982 Exhibit 4-30 to Registration No. 2-78941
August 15, 1982 Exhibit 4-32 to Registration No. 2-79674
October 15, 1985 Exhibit 4-170 to Form 10-K for
year ended December 31, 1994
November 30, 1987 Exhibit 4-139 to Form 10-K for
year ended December 31, 1992
July 15, 1989 Exhibit 4-171 to Form 10-K for
year ended December 31, 1994
</TABLE>
28
<PAGE> 29
<TABLE>
<S> <C>
December 1, 1989 Exhibit 4-172 to Form 10-K for
year ended December 31, 1994
February 15, 1990 Exhibit 4-173 to Form 10-K for
year ended December 31, 1994
April 1, 1991 Exhibit 4-15 to Form 10-K for year ended
December 31, 1996
May 1, 1991 Exhibit 4-178 to Form 10-K for year ended
December 31, 1996
May 15, 1991 Exhibit 4-179 to Form 10-K for year ended
December 31, 1996
September 1, 1991 Exhibit 4-180 to Form 10-K for year ended
December 31, 1996
November 1, 1991 Exhibit 4-181 to Form 10-K for year ended
December 31, 1996
January 15, 1992 Exhibit 4-182 to Form 10-K for year ended
December 31, 1996
February 29, 1992 Exhibit 4-187 to Form 10-Q for quarter
ended March 31, 1998
April 15, 1992 Exhibit 4-188 to Form 10-Q for quarter
ended March 31, 1998
July 15, 1992 Exhibit 4-189 to Form 10-Q for quarter
ended March 31, 1998
July 31, 1992 Exhibit 4-190 to Form 10-Q for quarter
ended March 31, 1998
November 30, 1992 Exhibit 4-130 to Registration No. 33-56496
January 1, 1993 Exhibit 4-131 to Registration No. 33-56496
March 1, 1993 Exhibit 4-191 to Form 10-Q for quarter
ended March 31, 1998
March 15, 1993 Exhibit 4-192 to Form 10-Q for quarter
ended March 31, 1998
April 1, 1993 Exhibit 4-143 to Form 10-Q for quarter
ended March 31, 1993
April 26, 1993 Exhibit 4-144 to Form 10-Q for quarter
ended March 31, 1993
May 31, 1993 Exhibit 4-148 to Registration No. 33-64296
June 30, 1993 Exhibit 4-149 to Form 10-Q for quarter
ended June 30, 1993 (1993 Series AP)
June 30, 1993 Exhibit 4-150 to Form 10-Q for quarter
ended June 30, 1993 (1993 Series H)
September 15, 1993 Exhibit 4-158 to Form 10-Q for quarter
ended September 30, 1993
March 1, 1994 Exhibit 4-163 to Registration No. 33-53207
June 15, 1994 Exhibit 4-166 to Form 10-Q for quarter
ended June 30, 1994
August 15, 1994 Exhibit 4-168 to Form 10-Q for quarter
ended September 30, 1994
December 1, 1994 Exhibit 4-169 to Form 10-K for
</TABLE>
29
<PAGE> 30
<TABLE>
<S> <C>
year ended December 31, 1994
August 1, 1995 Exhibit 4-174 to Form 10-Q for quarter
ended September 30, 1995
</TABLE>
4(b) - Collateral Trust Indenture (notes), dated as of June 30, 1993
(Exhibit 4-152 to Registration No. 33-50325).
4(c) - First Supplemental Note Indenture, dated as of June 30, 1993
(Exhibit 4-153 to Registration No. 33-50325).
4(d) - Second Supplemental Note Indenture, dated as of September
15, 1993 (Exhibit 4-159 to Form 10-Q for quarter ended
September 30, 1993).
4(e) - First Amendment, dated as of August 15, 1996, to Second
Supplemental Note Indenture (Exhibit 4-17 to Form 10-Q for
quarter ended September 30, 1996).
4(f) - Third Supplemental Note Indenture, dated as of August 15,
1994 (Exhibit 4-169 to Form 10-Q for quarter ended September
30, 1994).
4(g) - First Amendment, dated as of December 12, 1995, to Third
Supplemental Note Indenture, dated as of August 15, 1994
(Exhibit 4-12 to Registration No. 333-00023).
4(h) - Fourth Supplemental Note Indenture, dated as of August 15,
1995 (Exhibit 4-175 to Detroit Edison Form 10-Q for quarter
ended September 30, 1995).
4(i) - Fifth Supplemental Note Indenture, dated as of February 1,
1996 (Exhibit 4-14 to Form 10-K for year ended December 31,
1996).
4(j) - Sixth Supplemental Note Indenture, dated as of May 1,
1998, between Detroit Edison and Bankers Trust Company, as
Trustee, creating the 7.54% Quarterly Income Debt
Securities ("QUIDS"), including form of QUIDS. (Exhibit
4-193 to form 10-Q for quarter ended June 30, 1998.)
4(k - Seventh Supplemental Note Indenture, dated as of October
15, 1998, between Detroit Edison and Bankers Trust
Company, as Trustee, creating the 7.375% QUIDS, including
form of QUIDS. (Exhibit 4-198 to Form 10-K for year ended
December 31, 1998.)
4(l) - Standby Note Purchase Credit Facility, dated as of
August 17, 1994, among The Detroit Edison Company,
Barclays Bank PLC, as Bank and Administrative Agent, Bank
of America, The Bank of New York, The Fuji Bank Limited,
The Long-Term Credit Bank of Japan, LTD, Union Bank and
Citicorp Securities, Inc. and First Chicago Capital
Markets, Inc. as
30
<PAGE> 31
Remarketing Agents (Exhibit 99-18 to Form
10-Q for quarter ended September 30, 1994).
4-(m) - $60,000,000 Support Agreement dated as of January
21, 1998 between DTE Energy Company and DTE Capital
Corporation. (Exhibit 4-183 to Form 10-K for year ended
December 31, 1997.)
4-(n) - $100,000,000 Support Agreement, dated as of June 16,
1998, between DTE Energy Company and DTE Capital
Corporation. (Exhibit 4-194 to Form 10-Q for quarter ended
June 30, 1998.)
4-(o) - $300,000,000 Support Agreement, dated as of November 18,
1998, between DTE Energy and DTE Capital Corporation.
(Exhibit 4-199 to Form 10-K for year ended December 31,
1998.)
4-(p) - $400,000,000 Support Agreement, dated as of January 19,
1999, between DTE Energy Company and DTE Capital
Corporation. (Exhibit 4-201 to form 10-K for year ended
December 31, 1998.)
4-(q) - Indenture, dated as of June 15, 1998, between DTE
Capital Corporation and The Bank of New York, as Trustee.
(Exhibit 4-196 to Form 10-Q for quarter ended June 30,
1998.)
4-(r) - First Supplemental Indenture, dated as of June 15, 1998,
between DTE Capital Corporation and The Bank of New York,
as Trustee, creating the $100,000,000 Remarketed Notes,
Series A due 2038, including form of Note. (Exhibit 4-197
to Form 10-Q for quarter ended June 30, 1998.)
4-(s) - Second Supplemental Indenture, dated as of November 1,
1998, between DTE Capital Corporation and The Bank of New
York, as Trustee, creating the $300,000,000 Remarketed
Notes, 1998 Series B, including form of Note. (Exhibit
4-200 to Form 10-K for year ended December 31, 1998.)
4(t) - Second Amended and Restated Credit Agreement, Dated as
of January 19, 1999 among DTE Capital Corporation, the
Initial Lenders, Citibank, N.A., as Agent, and ABN AMRO
Bank N.V., Barclays Bank PLC, Bayerische Landesbank
Giruzertrale, Cayman Islands Branch, Comerica Bank, Den
Daske Bank Aktieselskab and The First National Bank of
Chicago, as Co-Agents, and Salomon Smith Barney Inc., as
Arranger. (Exhibit 99-28 to Form 10-K for year ended
December 31, 1998.)
*10-(a) The Detroit Edison Company Executive Incentive Plan (October
1997). (Exhibit 10-13* to Form 10-K for the year ended
December 31, 1997.)
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<PAGE> 32
10-(b) Detroit Edison Company Shareholder Value Improvement Plan-A
(October 1997). (Exhibit 10 15* to Form 10-K for year ended
December 31, 1997.)
99-(a)- Belle River Participation Agreement between Detroit
Edison and Michigan Public Power Agency, dated as of December
1, 1982 (Exhibit 28-5 to Registration No. 2-81501).
99(b)- Belle River Transmission Ownership and Operating
Agreement between Detroit Edison and Michigan Public Power
Agency, dated as of December 1, 1982 (Exhibit 28-6 to
Registration No. 2-81501).
99(c)- 1988 Amended and Restated Loan Agreement, dated as of
October 4, 1988, between Renaissance Energy Company (an
unaffiliated company) ("Renaissance") and Detroit Edison
(Exhibit 99-6 to Registration No. 33-50325).
99(d)- First Amendment to 1988 Amended and Restated Loan
Agreement, dated as of February 1, 1990, between Detroit
Edison and Renaissance (Exhibit 99-7 to Registration No.
33-50325).
99(e)- Second Amendment to 1988 Amended and Restated Loan
Agreement, dated as of September 1, 1993, between Detroit
Edison and Renaissance (Exhibit 99-8 to Registration No.
33-50325).
99(f)- Third Amendment, dated as of August 28, 1997, to 1988
Amended and Restated Loan Agreement between Detroit Edison
and Renaissance. (Exhibit 99-22 to Form 10-Q for quarter
ended September 30, 1997.)
99(g)- $200,000,000 364-Day Credit Agreement, dated as of
September 1, 1993, among Detroit Edison, Renaissance and
Barclays Bank PLC, New York Branch, as Agent (Exhibit
99-12 to Registration No. 33-50325).
99(h)- First Amendment, dated as of August 31, 1994, to
$200,000,000 364-Day Credit Agreement, dated September 1,
1993, among The Detroit Edison Company, Renaissance Energy
Company, the Banks party thereto and Barclays Bank, PLC,
New York Branch, as Agent (Exhibit 99-19 to Form 10-Q for
quarter ended September 30, 1994).
99(i)- Third Amendment, dated as of March 8, 1996, to
$200,000,000 364-Day Credit Agreement, dated September 1,
1993, as amended, among Detroit Edison, Renaissance, the
Banks party thereto and Barclays Bank, PLC, New York
Branch, as Agent (Exhibit 99-11 to Form 10-Q for quarter
ended March 31, 1996).
32
<PAGE> 33
99(j)- Fourth Amendment, dated as of August 29, 1996, to
$200,000,000 364-Day Credit Agreement as of September 1,
1990, as amended, among Detroit Edison, Renaissance, the
Banks party thereto and Barclays Bank, PLC, New York
Branch, as Agent (Exhibit 99-13 to Form 10-Q for quarter
ended September 30, 1996).
99(k)- Fifth Amendment, dated as of September 1, 1997, to $200,000,000
Multi-Year Credit Agreement, dated as of September 1, 1993, as
amended, among Detroit Edison, Renaissance, the Banks Party
thereto and Barclays Bank PLC, New York Branch, as Agent.
(Exhibit 99-24 to Form 10-Q for quarter ended September 30,
1997.)
99(l)- $200,000,000 Three-Year Credit Agreement, dated September 1,
1993, among Detroit Edison, Renaissance and Barclays Bank, PLC,
New York Branch, as Agent (Exhibit 99-13 to Registration No.
33-50325).
99(m)- First Amendment, dated as of September 1, 1994, to
$200,000,000 Three-Year Credit Agreement, dated as of
September 1, 1993, among The Detroit Edison Company,
Renaissance Energy Company, the Banks party thereto and
Barclays Bank, PLC, New York Branch, as Agent (Exhibit
99-20 to Form 10-Q for quarter ended September 30, 1994).
99(n)- Third Amendment, dated as of March 8, 1996, to
$200,000,000 Three-Year Credit Agreement, dated September
1, 1993, as amended among Detroit Edison, Renaissance, the
Banks party thereto and Barclays Bank, PLC, New York
Branch, as Agent (Exhibit 99-12 to Form 10-Q for` quarter
ended March 31, 1996).
99(o)- Fourth Amendment, dated as of September 1, 1996, to
$200,000,000 Multi-Year (formerly Three-Year) Credit
Agreement, dated as of September 1, 1993, as amended among
Detroit Edison, Renaissance, the Banks party thereto and
Barclays Bank, PLC, New York Branch, as Agent (Exhibit
99-14 to Form 10-Q for quarter ended September 30, 1996).
99(p)- Fifth Amendment, dated as of August 28, 1997, to
$200,000,000 364-Day Credit Agreement, dated as of
September 1, 1990, as amended, among Detroit Edison,
Renaissance, the Banks Party thereto and Barclays Bank
PLC, New York Branch, as Agent. (Exhibit 99-25 to Form
10-Q for quarter ended September 30, 1997.)
99(q)- Sixth Amendment, dated as of August 27, 1998, to
$200,000,000 364-Day Credit Agreement dated as of
September 1, 1990, as amended, among Detroit Edison,
Renaissance, the Banks party thereto and Barclays Bank
PLC, New York Branch, as agent. (Exhibit 99-32 to
Registration No. 333-65765.)
33
<PAGE> 34
99(r)- 1988 Amended and Restated Nuclear Fuel Heat Purchase
Contract, dated October 4, 1988, between Detroit Edison
and Renaissance (Exhibit 99-9 to Registration No.
33-50325).
99(s)- First Amendment to 1988 Amended and Restated Nuclear
Fuel Heat Purchase Contract, dated as of February 1, 1990,
between Detroit Edison and Renaissance (Exhibit 99-10 to
Registration No. 33-50325).
99(t)- Second Amendment, dated as of September 1, 1993, to 1988
Amended and Restated Nuclear Fuel Heat Purchase Contract
between Detroit Edison and Renaissance (Exhibit 99-11 to
Registration No. 33-50325).
99(u)- Third Amendment, dated as of August 31, 1994, to 1988
Amended and Restated Nuclear Fuel Heat Purchase Contract,
dated October 4, 1988, between The Detroit Edison Company
and Renaissance Energy Company (Exhibit 99-21 to Form 10-Q
for quarter ended September 30, 1994).
99(v)- Fourth Amendment, dated as of March 8, 1996, to 1988
Amended and Restated Nuclear Fuel Heat Purchase Contract
Agreement, dated as of October 4, 1988, between Detroit
Edison and Renaissance (Exhibit 99-10 to Form 10-Q for
quarter ended March 31, 1996).
99(w)- Sixth Amendment, dated as of August 28, 1997, to
1988 Amended and Restated Nuclear Fuel Heat Purchase
Contract between Detroit Edison and Renaissance. (Exhibit
99-23 to Form 10-Q for quarter ended September 30, 1997.)
99(x) - Standby Note Purchase Credit Facility, dated as of
September 12, 1997, among The Detroit Edison Company and
the Bank's Signatory thereto and The Chase Manhattan Bank,
as Administrative Agent, and Citicorp Securities, Inc.,
Lehman Brokers, Inc., as Remarketing Agents and Chase
Securities, Inc. as Arranger. (Exhibit 999-26 to Form 10-Q
for quarter ended September 30, 1997.)
(b) Registrants filed a report on Form 8-K, dated January 22, 1999,
discussing a series of MPSC Orders issued December 28, 1998.
*Denotes management contract or compensatory plan or arrangement.
34
<PAGE> 35
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
DTE ENERGY COMPANY
--------------------------------------
(Registrant)
Date April 28, 1999 /s/ SUSAN M. BEALE
------------------------------ --------------------------------------
Susan M. Beale
Vice President and Corporate Secretary
Date April 28, 1999 /s/ DAVID E. MEADOR
------------------------------ --------------------------------------
David E. Meador
Vice President and Controller
35
<PAGE> 36
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
THE DETROIT EDISON COMPANY
--------------------------------------
(Registrant)
Date April 28, 1999 /s/ SUSAN M. BEALE
------------------------------ --------------------------------------
Susan M. Beale
Vice President and Corporate Secretary
Date April 28, 1999 /s/ DAVID E. MEADOR
------------------------------ --------------------------------------
David E. Meador
Vice President and Controller
36
<PAGE> 37
QUARTERLY REPORTS ON FORM
10-Q FOR THE QUARTER ENDED
MARCH 31, 1999
DTE ENERGY COMPANY FILE NO. 1-11607
DETROIT EDISON COMPANY FILE NO. 1-2198
EXHIBIT INDEX
Exhibits filed herewith.
Exhibit
Number
--------
3-11 Bylaws of DTE Energy Company, as amended through April
28,1999.
3-12 Bylaws of The Detroit Edison Company, as amended
through April 28, 1999.
4-202 $40,000,000 Support Agreement dated as of February 24,
1999 between DTE Energy Company and DTE Capital
Corporation.
*10-32 1999 Shareholder Value Improvement Plan-A Measures.
*10-33 1999 Executive Incentive Plan Measures.
11-15- DTE Energy Company Basic and Diluted Earnings Per
Share of Common Stock.
12-16- DTE Energy Company Computation of Ratio of Earnings
to Fixed Charges.
12-17- The Detroit Edison Company Computation of Ratio of
Earnings to Fixed Charges.
15-10- Awareness Letter of Deloitte & Touche LLP regarding
their report dated April 28, 1999.
27-27- Financial Data Schedule for the period ended March
31, 1999 for DTE Energy Company.
27-28- Financial Data Schedule for the period ended March
31, 1999 for The Detroit Edison Company.
<PAGE> 38
Exhibits incorporated herein by reference. See Page Nos. through
for location of exhibits
incorporated by reference
3(a) - Amended and Restated Articles of Incorporation of DTE
Energy Company, dated December 13, 1995.
3(b) - Certificate of Designation of Series A Junior
Participating Preferred Stock of DTE Energy Company.
3(c) - Restated Articles of Incorporation of Detroit Edison,
as filed December 10, 1991 with the State of Michigan,
Department of Commerce - Corporation and Securities
Bureau.
3(d) - Certificate containing resolution of the Detroit
Edison Board of as filed February 22, 1993 with the
State of Michigan, Department of Commerce - Corporation
and Securities Bureau.
3(e) - Certificate containing resolution of the Detroit
Edison Board of Directors establishing the Cumulative
Preferred Stock, 7.74% Series, as filed April 21, 1993
with the State of Michigan, Department of Commerce -
Corporation and Securities Bureau.
3(f) - Rights Agreement, dated as of September 23, 1997, by
and between DTE Energy Company and The Detroit Edison
Company, as Rights Agent.
3(g) - Agreement and Plan of Exchange.
4(a) - Mortgage and Deed of Trust, dated as of October 1,
1924, between Detroit Edison and Bankers Trust Company
as Trustee and indentures supplemental thereto, dated
as of dates indicated below, and filed as exhibits to
the filings as set forth below:
September 1, 1947
October 1, 1968
November 15, 1971
January 15, 1973
June 1, 1978
June 30, 1982
August 15, 1982
October 15, 1985
November 30, 1987
July 15, 1989
December 1, 1989
February 15, 1990
April 1, 1991
May 1, 1991
<PAGE> 39
September 1, 1991
November 1, 1991
January 15, 1992
February 29, 1992
April 15, 1992
July 15, 1992
July 31, 1992
November 30, 1992
January 1, 1993
March 1, 1993
March 15, 1993
April 1, 1993
April 26, 1993
May 31, 1993
June 30, 1993
June 30, 1993
September 15, 1993
March 1, 1994
June 15, 1994
August 15, 1994
December 1, 1994
August 1, 1995
4(b) - Collateral Trust Indenture (notes), dated as of June
30, 1993.
4(c) - First Supplemental Note Indenture, dated as of June
30, 1993.
4(d) - Second Supplemental Note Indenture, dated as of
September 15, 1993.
4(e) - First Amendment, dated as of August 15, 1996, to
Second Supplemental Note Indenture.
4(f) - Third Supplemental Note Indenture, dated as of
August 15, 1994.
4(g) - First Amendment, dated as of December 12, 1995, to
Third Supplemental Note Indenture, dated as of August
15, 1994.
4(h) - Fourth Supplemental Note Indenture, dated as of
August 15, 1995.
4(i) - Fifth Supplemental Note Indenture, dated as of
February 1, 1996.
4(j) - Sixth Supplemental Note Indenture, dated as of May
1, 1998, between Detroit Edison and Bankers Trust
Company, as Trustee, creating the 7.54% Quarterly
Income Debt Securities ("QUIDS"), including form of
QUIDS.
4(k) - Seventh Supplemental Note Indenture, dated as of
October 15, 1998, between Detroit Edison and Bankers
Trust Company, as Trustee, creating the 7.375% QUIDS,
including form of QUIDS.
<PAGE> 40
4(l) - Standby Note Purchase Credit Facility, dated as of
August 17, 1994, among The Detroit Edison Company,
Barclays Bank PLC, as Bank and Administrative Agent,
Bank of America, The Bank of New York, The Fuji Bank
Limited, The Long-Term Credit Bank of Japan, LTD,
Union Bank and Citicorp Securities, Inc. and First
Chicago Capital Markets, Inc. as Remarketing Agents.
4-(m) - $60,000,000 Support Agreement dated as of January
21, 1998 between DTE Energy Company and DTE Capital
Corporation.
4-(n) - $100,000,000 Support Agreement, dated as of June 16,
1998, between DTE Energy Company and DTE Capital
Corporation.
4-(o) - $300,000,000 Support Agreement, dated as of November
18, 1998, between DTE Energy and DTE Capital
Corporation.
4-(p) - $400,000,000 Support Agreement, dated as of January
19, 1999, between DTE Energy Company and DTE Capital
Corporation.
4-(q) - Indenture, dated as of June 15, 1998, between DTE
Capital Corporation and The Bank of New York, as
Trustee.
4-(r) - First Supplemental Indenture, dated as of June 15,
1998, between DTE Capital Corporation and The Bank of
New York, as Trustee, creating the $100,000,000
Remarketed Notes, Series A due 2038, including form of
Note.
4-(s) - Second Supplemental Indenture, dated as of November
1, 1998, between DTE Capital Corporation and The Bank
of New York, as Trustee, creating the $300,000,000
Remarketed Notes, 1998 Series B, including form of
Note.
4(t) - Second Amended and Restated Credit Agreement, Dated
as of January 19, 1999 among DTE Capital Corporation,
the Initial Lenders, Citibank, N.A., as Agent, and ABN
AMRO Bank N.V., Barclays Bank PLC, Bayerische
Landesbank Giruzertrale, Cayman Islands Branch,
Comerica Bank, Den Daske Bank Aktieselskab and The
First National Bank of Chicago, as Co-Agents, and
Salomon Smith Barney Inc., as Arranger.
*10-(a) The Detroit Edison Company Executive Incentive Plan
(October 1997).
*10-(b) Detroit Edison Company Shareholder Value Improvement
Plan-A (October 1997).
99-(a)- Belle River Participation Agreement between Detroit
Edison and Michigan Public Power Agency, dated as of
December 1, 1982.
<PAGE> 41
99(b) - Belle River Transmission Ownership and Operating
Agreement between Detroit Edison and Michigan Public
Power Agency, dated as of December 1, 1982.
99(c) - 1988 Amended and Restated Loan Agreement, dated as
of October 4, 1988, between Renaissance Energy Company
(an unaffiliated company) ("Renaissance") and Detroit
Edison.
99(d) - First Amendment to 1988 Amended and Restated Loan
Agreement, dated as of February 1, 1990, between
Detroit Edison and Renaissance.
99(e) - Second Amendment to 1988 Amended and Restated Loan
Agreement, dated as of September 1, 1993, between
Detroit Edison and Renaissance.
99(f) - Third Amendment, dated as of August 28, 1997, to
1988 Amended and Restated Loan Agreement between
Detroit Edison and Renaissance.
99(g) - $200,000,000 364-Day Credit Agreement, dated as of
September 1, 1993, among Detroit Edison, Renaissance
and Barclays Bank PLC, New York Branch, as Agent.
99(h) - First Amendment, dated as of August 31, 1994, to
$200,000,000 364-Day Credit Agreement, dated September
1, 1993, among The Detroit Edison Company, Renaissance
Energy Company, the Banks party thereto and Barclays
Bank, PLC, New York Branch, as Agent.
99(i) - Third Amendment, dated as of March 8, 1996, to
$200,000,000 364-Day Credit Agreement, dated September
1, 1993, as amended, among Detroit Edison,
Renaissance, the Banks party thereto and Barclays
Bank, PLC, New York Branch, as Agent.
99(j) - Fourth Amendment, dated as of August 29, 1996, to
$200,000,000 364-Day Credit Agreement as of September
1, 1990, as amended, among Detroit Edison,
Renaissance, the Banks party thereto and Barclays
Bank, PLC, New York Branch, as Agent.
99(k) - Fifth Amendment, dated as of September 1, 1997, to
$200,000,000 Multi-Year Credit Agreement, dated as of
September 1, 1993, as amended, among Detroit Edison,
Renaissance, the Banks Party thereto and Barclays Bank
PLC, New York Branch, as Agent.
99(l) - $200,000,000 Three-Year Credit Agreement, dated
September 1, 1993, among Detroit Edison, Renaissance
and Barclays Bank, PLC, New York Branch, as Agent.
<PAGE> 42
99(m) - First Amendment, dated as of September 1, 1994, to
$200,000,000 Three-Year Credit Agreement, dated as of
September 1, 1993, among The Detroit Edison Company,
Renaissance Energy Company, the Banks party thereto
and Barclays Bank, PLC, New York Branch, as Agent.
99(n) - Third Amendment, dated as of March 8, 1996, to
$200,000,000 Three-Year Credit Agreement, dated
September 1, 1993, as amended among Detroit Edison,
Renaissance, the Banks party thereto and Barclays
Bank, PLC, New York Branch, as Agent.
99(o) - Fourth Amendment, dated as of September 1, 1996, to
$200,000,000 Multi-Year (formerly Three-Year) Credit
Agreement, dated as of September 1, 1993, as amended
among Detroit Edison, Renaissance, the Banks party
thereto and Barclays Bank, PLC, New York Branch, as
Agent.
99(p) - Fifth Amendment, dated as of August 28, 1997, to
$200,000,000 364-Day Credit Agreement, dated as of
September 1, 1990, as amended, among Detroit Edison,
Renaissance, the Banks Party thereto and Barclays Bank
PLC, New York Branch, as Agent.
99(q) - Sixth Amendment, dated as of August 27, 1998, to
$200,000,000 364-Day Credit Agreement dated as of
September 1, 1990, as amended, among Detroit Edison,
Renaissance, the Banks party thereto and Barclays Bank
PLC, New York Branch, as agent.
99(r) - 1988 Amended and Restated Nuclear Fuel Heat Purchase
Contract, dated October 4, 1988, between Detroit
Edison and Renaissance.
99(s) - First Amendment to 1988 Amended and Restated Nuclear
Fuel Heat Purchase Contract, dated as of February 1,
1990, between Detroit Edison and Renaissance.
99(t) - Second Amendment, dated as of September 1, 1993, to
1988 Amended and Restated Nuclear Fuel Heat Purchase
Contract between Detroit Edison and Renaissance.
99(u) - Third Amendment, dated as of August 31, 1994, to
1988 Amended and Restated Nuclear Fuel Heat Purchase
Contract, dated October 4, 1988, between The Detroit
Edison Company and Renaissance Energy Company.
99(v) - Fourth Amendment, dated as of March 8, 1996, to 1988
Amended and Restated Nuclear Fuel Heat Purchase
Contract Agreement, dated as of October 4, 1988,
between Detroit Edison and Renaissance.
<PAGE> 43
99(w) - Sixth Amendment, dated as of August 28, 1997, to 1988
Amended and Restated Nuclear Fuel Heat Purchase
Contract between Detroit Edison and Renaissance.
99(x) - Standby Note Purchase Credit Facility, dated as of
September 12, 1997, among The Detroit Edison Company
and the Bank's Signatory thereto and The Chase
Manhattan Bank, as Administrative Agent, and Citicorp
Securities, Inc., Lehman Brokers, Inc., as Remarketing
Agents and Chase Securities, Inc. as Arranger.
*Denotes management contract or compensatory plan or arrangement.
<PAGE> 1
EXHIBIT 3-11
================================================================================
================================================================================
BYLAWS
of
DTE ENERGY COMPANY
As amended through April 28, 1999
================================================================================
================================================================================
<PAGE> 2
BYLAWS
of
DTE ENERGY COMPANY
------------------
INDEX
Page
----
ARTICLE I
Shareholders................................................................1
SECTION 1. Annual Meeting.............................................1
SECTION 2. Special Meetings...........................................1
SECTION 3. Notice of Meetings.........................................1
SECTION 4. Quorum.....................................................2
SECTION 5. Voting and Inspectors......................................2
SECTION 6. Record of Shareholders.....................................2
SECTION 7. List of Shareholders.......................................2
SECTION 8. Order of Business..........................................3
ARTICLE II
Board of Directors and Committees...........................................4
SECTION 1 Number, Time of Holding Office, and Limitation on
Age........................................................4
SECTION 2. Vacancies..................................................5
SECTION 3. Nominations of Directors; Elections........................5
SECTION 4. Meetings of the Board......................................6
SECTION 5. Quorum.....................................................6
SECTION 6. Annual Meeting of Directors................................7
SECTION 7. Executive Committee........................................7
SECTION 8. Committees.................................................7
SECTION 9. Participation in Meetings..................................7
SECTION 10. Compensation...............................................8
ARTICLE III
Officers....................................................................8
SECTION 1. Officers and Agents........................................8
SECTION 2. Term of Office.............................................8
SECTION 3. Chairman of the Board......................................8
SECTION 4. President..................................................8
SECTION 5. Other Officers.............................................9
SECTION 6. Compensation...............................................9
SECTION 7. Voting of Shares and Securities
of Other Corporations......................................9
<PAGE> 3
ARTICLE IV
Capital Stock...............................................................9
SECTION 1. Certificates of Shares.....................................9
SECTION 2. Transfer of Shares.........................................9
SECTION 3. Lost or Destroyed Stock Certificates.......................9
ARTICLE V
Checks, Notes, Bonds, Debentures, etc......................................10
ARTICLE VI
Corporate Seal.............................................................10
ARTICLE VII
Control Share Acquisitions.................................................10
ARTICLE VIII
Amendment of Bylaws........................................................10
ii
<PAGE> 4
BYLAWS
OF
DTE ENERGY COMPANY
AS AMENDED THROUGH MAY 1, 1998
ARTICLE I
SHAREHOLDERS
Section 1. ANNUAL MEETING. The annual meeting of the shareholders of
the Company shall be held on the fourth Wednesday of April in each year (or if
said day be a legal holiday, then on the next succeeding day not a legal
holiday), at such time and at such place as may be fixed by the Board of
Directors and stated in the notice of meeting, for the purpose of electing
directors and transacting such other business as may properly be brought before
the meeting as determined by Article I, Section 8 hereof.
Section 2. SPECIAL MEETINGS. Special meetings of the shareholders may
be held upon call of the Board of Directors or the Chairman of the Board or the
President or the holders of record of three-quarters of the outstanding shares
of stock of the Company entitled to vote at such meeting, at such time as may be
fixed by the Board of Directors or the Chairman of the Board or the President or
such shareholders and stated in the notice of meeting. All such meetings shall
be held at the office of the Company in the City of Detroit unless some other
place is specified in the notice.
Section 3. NOTICE OF MEETINGS. Written notice of the date, time, place
and purpose or purposes of every meeting of the shareholders, signed by the
Corporate Secretary or an Assistant Corporate Secretary, shall be given either
personally or by mail, within the time prescribed by law, to each shareholder of
record entitled to vote at such meeting and to any shareholder who, by reason of
any action proposed to be taken at such meeting, might be entitled to receive
payment for such stock if such action were taken. If mailed, such notice is
given when deposited in the United States mail, with postage prepaid, directed
to the shareholder at the address as it appears on the record of shareholders,
or, if the shareholders shall have filed with the Corporate Secretary of the
Company a written request that notices intended for such shareholder be mailed
to some other address, then directed to the address designated in such request.
Further notice shall be given by mail, publication, or otherwise, if and as
required by law.
Notice of meeting need not be given to any shareholder who submits a
signed waiver of notice, in person or by proxy, whether before or after the
meeting.
1
<PAGE> 5
The attendance of any shareholder at the meeting, in person or by
proxy, without protesting at the beginning of the meeting the lack of notice of
such meeting, shall constitute a waiver of notice by such shareholder.
Notice of a special meeting shall also indicate that it is being issued
by or at the direction of the person or persons calling the meeting.
Section 4. QUORUM. At every meeting of the shareholders, the holders of
record of a majority of the outstanding shares of stock of the Company entitled
to vote at such meeting, whether present in person or represented by proxy,
shall constitute a quorum. If at any meeting there shall be no quorum, the
holders of a majority of the outstanding shares of stock so present or
represented may adjourn the meeting from time to time, without notice (unless
otherwise required by statute) other than announcement at the meeting, until a
quorum shall have been obtained, when any business may be transacted which might
have been transacted at the meeting as first convened had there been a quorum.
When a quorum is once present to organize a meeting, it is not broken by the
subsequent withdrawal of any shareholder.
Section 5. VOTING AND INSPECTORS. Except as provided in the Articles of
Incorporation, each holder of record of outstanding shares of stock of the
Company entitled to vote at a meeting of shareholders shall be entitled to one
vote for each share of stock standing in the shareholder's name on the record of
shareholders, and may so vote either in person or by proxy appointed by
instrument in writing executed by such holder or by the shareholder's duly
authorized attorney-in-fact. No proxy shall be valid after the expiration of
three years from the date of its execution unless the shareholder executing it
shall have specified the length of time it is to continue in force which shall
be for some limited period. The authority of the holder of a proxy to act shall
not be revoked by the incompetence or death of the shareholder who executed the
proxy unless, before the authority is exercised, written notice of an
adjudication of such incompetence or of such death is received by the Corporate
Secretary or an Assistant Corporate Secretary.
In advance of any meeting of shareholders, the Board of Directors may
appoint one or more inspectors for the meeting. If inspectors are not so
appointed, the chairman of the meeting shall appoint such inspectors. Before
entering upon the discharge of their duties, the inspectors shall take and
subscribe an oath faithfully to execute the duties of inspector at such meeting
with strict impartiality and according to the best of their ability, and shall
take charge of the polls and after balloting shall make a certificate of the
result of the vote taken. No officer or director of the Company or candidate for
office of director shall be appointed as an inspector. At all elections of
directors the voting shall be by ballot and a plurality of the votes cast shall
elect.
Section 6. RECORD OF SHAREHOLDERS. For the purpose of determining the
shareholders entitled to notice of or to vote at any meeting of shareholders or
any adjournment thereof, or to express consent to or dissent from any proposal
without
2
<PAGE> 6
a meeting, or for the purpose of determining shareholders entitled to
receive payment of any dividend or the allotment of any rights, or for the
purpose of any other action, the Board of Directors may fix, in advance, a date
as the record date for any such determination of shareholders. The record date
shall not precede the date upon which it is fixed and shall not be less than 10
days nor more than the maximum number of days permitted by law before the date
of the meeting, or taking of any other action.
Section 7. LIST OF SHAREHOLDERS. A list of shareholders of record,
arranged alphabetically within each class and series of stock, as of the record
date, certified by the Corporate Secretary or any Assistant Corporate Secretary
or by a transfer agent, shall be produced at any meeting of shareholders and may
be inspected by any shareholder at any time during the meeting. If the right to
vote at any meeting is challenged, the inspectors, or the chairman presiding at
the meeting, shall require such list of shareholders to be produced as evidence
of the right of the
3
<PAGE> 7
persons challenged to vote at such meeting, and all persons who appear on such
list to be shareholders entitled to vote thereat may vote at such meeting.
SECTION 8. ORDER OF BUSINESS. (a) The Chairman, or such other officer
of the Company designated by a majority of the total number of directors that
the Company would have if there were no vacancies on the Board of Directors
(such number being referred to as the "Whole Board"), will call meetings of
shareholders to order and will act as presiding officer thereof. Unless
otherwise determined by the Board of Directors prior to the meeting, the
presiding officer of the meeting of shareholders will also determine the order
of business and have the authority in his or her sole discretion to regulate the
conduct of any such meeting including, without limitation, by imposing
restrictions on the persons (other than shareholders of the Company or their
duly appointed proxies) who may attend any such shareholders' meeting, by
ascertaining whether any shareholder or his proxy may be excluded from any
meeting of shareholders based upon any determination by the presiding officer,
in his or her sole discretion, that any such person has unduly disrupted or is
likely to disrupt the proceedings of the meeting, and by determining the
circumstances in which any person may make a statement or ask questions at any
meeting of shareholders.
(b) At an annual meeting of the shareholders, only such business will
be conducted or considered as is properly brought before the meeting. To be
properly brought before an annual meeting, business must be (i) specified in the
notice of meeting (or any supplement thereto) given by or at the direction of
the Chairman, the President, a Vice President, the Corporate Secretary or an
Assistant Corporate Secretary in accordance with Section 3 of this Article I;
(ii) otherwise properly brought before the meeting by the presiding officer or
by or at the direction of a majority of the Whole Board; or (iii) otherwise
properly requested to be brought before the meeting by a shareholder of the
Company in accordance with Section 8(c) below.
(c) For business to be properly requested by a shareholder to be
brought before an annual meeting, the shareholder must (i) be a shareholder of
the Company of record at the time of the giving of the notice for such annual
meeting provided for in these Bylaws; (ii) be entitled to vote at such meeting;
and (iii) have given timely notice thereof in writing to the Corporate
Secretary. To be timely, a shareholder's notice must be delivered to or mailed
and received at the principal executive offices of the Company not less than 60
nor more than 90 calendar days prior to the annual meeting; provided, however,
that in the event public announcement of the date of the annual meeting is not
made at least 100 calendar days prior to the date of the annual meeting, notice
by the shareholder to be timely must be so received not later than the close of
business on the 10th calendar day following the day on which public announcement
is first made of the date of the annual meeting. A shareholder's notice to the
Corporate Secretary must set forth as to each matter the shareholder proposes to
bring before the annual meeting: (a)
4
<PAGE> 8
a description in reasonable detail of the business desired to be brought before
the annual meeting and the reasons for conducting such business at the annual
meeting; (b) the name and address, as they appear on the Company's books, of the
shareholder proposing such business and of the beneficial owner, if any, on
whose behalf the proposal is made; (c) the class and number of shares of the
Company that are owned beneficially and of record by the shareholder proposing
such business and by the beneficial owner, if any, on whose behalf the proposal
is made; and (d) any material interest in such business of such shareholder
proposing such business and the beneficial owner, if any, on whose behalf the
proposal is made. Notwithstanding the foregoing provisions of this Section 8(c),
a shareholder must also comply with all applicable requirements of the
Securities Exchange Act of 1934, as amended, and the rules and regulations
thereunder with respect to the matters set forth in this Section 8(c). For
purposes of this Section 8(c) and Section 3 of Article II, "public announcement"
means disclosure in a press release reported by the Dow Jones News Service,
Associated Press, or comparable national news service or in a document publicly
filed by the Company with the Securities and Exchange Commission pursuant to
Sections 13, 14, or 15(d) of the Securities Exchange Act of 1934, as amended, or
publicly filed by the Company with any national securities exchange or quotation
service through which the Company's stock is listed or traded, or furnished by
the Company to its shareholders. Nothing in this Section 8(c) will be deemed to
affect any rights of shareholders to request inclusion of proposals in the
Company's proxy statement pursuant to Rule 14a-8 under the Securities Exchange
Act of 1934, as amended.
(d) At a special meeting of shareholders, only such business may be
conducted or considered as is properly brought before the meeting. To be
properly brought before a special meeting, business must be (i) specified in the
notice of the meeting (or any supplement thereto) given by or at the direction
of the Chairman, the President, a Vice President, the Corporate Secretary or an
Assistant Corporate Secretary (or in case of their failure to give any required
notice, the other persons entitled to give notice) in accordance with Section 3
of Article I or (ii) otherwise brought before the meeting by the presiding
officer or by or at the direction of a majority of the Whole Board.
(e) The determination of whether any business sought to be brought
before any annual or special meeting of the shareholders is properly brought
before such meeting in accordance with this Section 8 will be made by the
presiding officer of such meeting. If the presiding officer determines that any
business is not properly brought before such meeting, he or she will so declare
to the meeting and any such business will not be conducted or considered.
ARTICLE II
BOARD OF DIRECTORS AND COMMITTEES
5
<PAGE> 9
Section 1. NUMBER, TIME OF HOLDING OFFICE AND LIMITATION ON AGE. The
business and affairs of the Company shall be managed by or under the direction
of a Board of Directors. The number of directors constituting the Whole Board
shall be determined from time to time by resolution of the Board so long as the
total number of directors is not less than ten nor more than eighteen; provided,
however, that the minimum and maximum number of directors may be increased or
decreased from time to time by vote of a majority of the Whole Board; and,
further provided that no change in the number of directors shall serve to
shorten the term of office of any incumbent director. The directors shall be
divided into three classes, as nearly equal in number as possible, and the term
of the office of the first class shall expire at the 1996 annual meeting of
shareholders, the term of office of the second class shall expire at the 1997
annual meeting of shareholders and the term of office of the third class shall
expire at the 1998 annual meeting of shareholders, or, in each case, until their
successors shall be duly elected and qualified. At each annual meeting
commencing in 1996, a number of directors equal to the number of the class whose
term expires at the time of the meeting shall be elected to hold office until
the third succeeding annual meeting of shareholders. If at any time the holders
of any series of the Company's Preferred Stock are entitled to elect directors
pursuant to the Articles of Incorporation of the Company, then the provisions of
such series of Preferred Stock with respect to their rights shall apply and such
directors shall be elected in a manner and for terms expiring consistent with
the Articles of Incorporation.
Except as hereinafter provided, each director shall be a holder of
Common Stock of the Company at the time of initial election to the Board or
shall become a holder within 30 days after such election (to the extent of at
least one share, owned beneficially). Any director who thereafter ceases to be
such a holder, shall thereupon cease to be a director. The Board shall have the
authority to waive the requirement to hold shares in individual situations upon
presentation of evidence that a nominee or director is unable to hold shares for
legal or religious reasons.
No person who shall have served as an employee of the Company or an
affiliate shall be elected a director after retiring from employment with the
Company or an affiliate; provided, however, that if such person was the Chief
Executive Officer of the Company at the time of such retirement, such person
shall be eligible for election as a director until attaining age 70. No other
person shall be elected a director after attaining age 70; provided, however,
the Board shall have the authority to waive this provision for no more than one
three-year term upon a determination that circumstances exist which make it
prudent to continue the service of a director who possesses special and unique
expertise clearly beneficial to the Company.
Section 2. VACANCIES. Whenever any vacancy shall occur in the Board of
Directors by death, resignation, or any other cause, it shall be filled without
undue delay by a majority vote of the remaining members of the Board of
Directors (even if constituting less than a quorum), and the person who is to
fill any such
6
<PAGE> 10
vacancy shall hold office for the unexpired term of the director to whom such
person succeeds, or for the term fixed by the Board of Directors acting in
compliance with Section l of this Article II in case of a vacancy created by an
increase in the number of directors, and until a successor shall be elected and
shall have qualified; provided, however, that no vacancy need be filled if,
after such vacancy shall occur, the number of directors remaining on the Board
shall be not less than a majority of the Whole Board. During the existence of
any vacancy or vacancies, the surviving or remaining directors shall possess and
may exercise all the powers of the full Board of Directors, when action by a
larger number is not required by law.
SECTION 3. NOMINATIONS OF DIRECTORS; ELECTION. (a) Except as may be
otherwise provided in any resolution establishing any Preferred Stock, only
persons who are nominated in accordance with this Section 3 will be eligible for
election at a meeting of shareholders to be members of the Board of Directors of
the Company.
(b) Nominations of persons for election as directors of the Company may
be made only at an annual meeting of shareholders (i) by or at the direction of
the Board of Directors or a committee thereof or (ii) by any shareholder who is
a shareholder of record at the time of giving of notice provided for in this
Section 3, who is entitled to vote for the election of directors at such
meeting, and who complies with the procedures set forth in this Section 3. All
nominations by shareholders must be made pursuant to timely notice in proper
written form to the Corporate Secretary.
(c) To be timely, a shareholder's notice must be delivered to or mailed
and received at the principal executive offices of the Company not less than 60
nor more than 90 calendar days prior to the annual meeting of shareholders;
provided, however, that in the event that public announcement of the date of the
annual meeting is not made at least 100 calendar days prior to the date of the
annual meeting, notice by the shareholder to be timely must be so received not
later than the close of business on the 10th calendar day following the day on
which public announcement (as defined in Section 8(c ) of Article I) is first
made of the date of the annual meeting. To be in proper written form, such
shareholder's notice must set forth or include: (i) the name and address, as
they appear on the Company's books, of the shareholder giving the notice and of
the beneficial owner, if any, on whose behalf the nomination is made; (ii) a
representation that the shareholder giving the notice is a holder of record of
stock of the Company entitled to vote at such annual meeting and intends to
appear in person or by proxy at the annual meeting to nominate the person or
persons specified in the notice; (iii) the class and number of shares of stock
of the Company owned beneficially and of record by the shareholder giving the
notice and by the beneficial owner, if any, on whose behalf the nomination is
made; (iv) a description of all arrangements or understandings between or among
any of (A) the shareholder giving the notice, (B) the beneficial owner on whose
behalf the notice is given, (C) each nominee, and (D)
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any other person or persons (naming such person or persons) pursuant to which
the nomination or nominations are to be made by the shareholder giving the
notice; (v) such other information regarding each nominee proposed by the
shareholder giving the notice as would be required to be included in a proxy
statement filed pursuant to the proxy rules of the Securities and Exchange
Commission had the nominee been nominated, or intended to be nominated, by the
Board of Directors; and (vi) the signed consent of each nominee to serve as a
director of the Company if so elected. The presiding officer of any annual
meeting may, if the facts warrant, determine that a nomination was not made in
accordance with this Section 3, and if he or she should so determine, he or she
will so declare to the meeting, and the defective nomination will be
disregarded. Notwithstanding the foregoing provisions of this Section 3, a
shareholder must also comply with all applicable requirements of the Securities
Exchange Act of 1934, as amended, and the rules and regulations thereunder with
respect to the matters set forth in this Section 3.
Section 4. MEETINGS OF THE BOARD. Regular meetings of the Board of
Directors shall be held at such times and at such places as may from time to
time be fixed by the Board of Directors.
Special meetings of the Board of Directors may be called by the
Chairman of the Board, the President, or, in the event of the incapacity of the
Chairman of the Board and the President, the Executive Committee by giving
reasonable notice of the time and place of such meetings or by obtaining written
waivers of notice, before or after the meeting, from each absent director. All
such meetings shall be held at the office of the Company in the City of Detroit
unless some other place is specified in the notice.
A notice, or waiver of notice, need not specify the purpose of the
meeting.
Section 5. QUORUM. A majority of the directors in office at the time of
a meeting of the Board, shall constitute a quorum for the transaction of
business. If at any meeting of the Board of Directors there shall be less than a
quorum present, a majority of the directors present may adjourn the meeting
without notice other than announcement at the meeting, until a quorum shall have
been obtained, when any business may be transacted which might have been
transacted at the meeting as first convened had there been a quorum. The acts of
a majority of the directors present at any meeting at which there is a quorum
shall be the acts of the Board, unless otherwise provided by law, by the
Articles of Incorporation or by the Bylaws.
Section 6. ANNUAL MEETING OF DIRECTORS. A meeting of the Board of
Directors, known as the directors' annual meeting, shall be held without notice
each year after the adjournment of the annual shareholders' meeting and on the
same day. At such meeting the officers of the Company for the ensuing year shall
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be elected. If a quorum of the directors is not present on the day appointed for
the directors' annual meeting, the meeting shall be adjourned to some convenient
day.
Section 7. EXECUTIVE COMMITTEE. The Board of Directors may, by
resolution or resolutions passed by a majority of the Whole Board, designate an
Executive Committee to consist of the Chief Executive Officer and two or more of
the other directors, and alternates, and shall designate the Chairman thereof.
The Executive Committee shall have and may exercise, when the Board is not in
session, all of the powers of the Board in the management of the business and
affairs of the Company, and shall have power to authorize the seal of the
Company to be affixed to all papers which may require it. The Executive
Committee shall not have power to (a) amend these Bylaws, (b) change the number
of directors constituting the Whole Board or fill vacancies in the Board, (c)
declare dividends, (d) establish, change the membership of, or fill vacancies
in, any committee, (e) fix the compensation of the directors or committee
members, (f) submit matters for action by shareholders, or (g) amend or repeal a
resolution of the Board which by its terms may not be changed by the Executive
Committee. The Board shall have the power at any time to fill vacancies in, to
change the membership of, or to dissolve, the Executive Committee. The Executive
Committee may make rules for the conduct of its business and may appoint such
subcommittees and assistants as it shall from time to time deem necessary. A
majority of the members of the Executive Committee shall constitute a quorum.
All action taken by the Executive Committee shall be reported to the Board at
its next meeting succeeding such action. The Corporate Secretary or an Assistant
Corporate Secretary shall attend and act as the secretary of all meetings of the
Committee and keep the minutes thereof.
Meetings of the Executive Committee may be called by the Chairman of
the Board, or, the President, or, in the event of the incapacity of the Chairman
of the Board and the President, by two or more members of the Executive
Committee by giving reasonable notice of the time and place of such meetings.
All such meetings shall be held at the office of the Company in the City of
Detroit unless some other place is specified in the notice.
Section 8. COMMITTEES. The Board of Directors may, by resolution,
create a committee or committees of one or more directors, and alternates, to
consider and report upon or to
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carry out such matters (not excepted by Article II, Section 7) as may be
entrusted to them by the Board of Directors, and shall designate the Chairman of
each such committee.
Section 9. PARTICIPATION IN MEETINGS. One or more members of the Board
of Directors or any committee may participate in any meeting of such Board or
such committee by means of a conference telephone or similar communications
equipment which enables all persons participating in such a meeting to hear each
other at the same time. Participation in the manner so described shall
constitute presence in person at such meetings.
Section 10. COMPENSATION. Each director of the Company who is not a
salaried officer or employee of the Company may receive reasonable compensation
for services as a director, including a reasonable fee for attendance at
meetings of the Board and committees thereof, and attendance at the Company's
request at other meetings or similar activities related to the Company.
ARTICLE III
OFFICERS
Section 1. OFFICERS AND AGENTS. The officers of the Company to be
elected by the Board of Directors, as soon as practicable after the election of
directors each year, shall be Chairman of the Board, the President, a Corporate
Secretary and a Treasurer. The Board of Directors may also from time to time
elect one or more Vice Presidents, a Controller, a General Auditor, a General
Counsel, and such other officers and agents as it may deem proper. The Chairman
of the Board and the President shall be chosen from among the directors. The
persons holding the offices of Chairman of the Board or President may not also
hold the office of General Auditor. The Board of Directors may, in its
discretion, leave vacant any office other than that of Chairman of the Board,
President, Corporate Secretary, or Treasurer.
Section 2. TERM OF OFFICE. The term of office of all officers shall be
until the next directors' annual meeting or until their respective successors
are chosen and qualified. Any officer or agent elected by the Board of Directors
may be removed by the Board at any time, with or without cause.
Section 3. CHAIRMAN OF THE BOARD. The Chairman of the Board shall be
the Chief Executive Officer of the Company and, shall preside at all meetings of
the Board of Directors and, subject to Section 8(a) of Article I, meetings of
shareholders, at which the Chairman is present, and shall make the annual report
to the shareholders. The Chairman shall have general charge of the business and
affairs of the Company subject to the control of the Board of Directors, may
create
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in the name of the Company any authorized corporate obligation or other
instrument and shall perform such other functions as may be prescribed by the
Board from time to time.
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The Chairman of the Board shall manage or supervise the conduct of the
corporate finances and relations of the Company with its shareholders, with the
public, and with regulatory authorities, and in addition to the President, may
exercise all powers elsewhere in the Bylaws conferred upon the President. The
Chairman may delegate from time to time to the President or to other officers,
employees or positions of the Company, such powers as the Chairman may specify
in writing, with such terms and conditions, if any, as the Chairman may set
forth. A copy of each such delegation and of any revocation or change shall be
filed with the Corporate Secretary.
Section 4. PRESIDENT. The President shall be the chief operating
officer of the Company, subject to the control of the Board of Directors and the
Chairman of the Board, shall have power to authorize the employment of such
subordinate employees as may, in the President's judgment, be advisable for the
operations of the Company, may execute in the name of the Company any authorized
corporate obligation or other instrument, and shall perform all other acts
incident to the President's office or prescribed by the Board of Directors or
the Chairman of the Board, or authorized or required by law. During the absence
or disability of the Chairman of the Board, the President shall assume the
duties and authority of the Chairman of the Board and shall be the Chief
Executive Officer of the Company.
Section 5. OTHER OFFICERS. The other officers, agents, and employees of
the Company shall each have such powers and perform such duties in the
management of the property and affairs of the Company, subject to the control of
the Board of Directors, as generally pertain to their respective offices, as
well as such powers and duties as from time to time may be prescribed by the
Board of Directors, by the Chairman of the Board, or by the President.
Section 6. COMPENSATION. The Board of Directors shall determine the
compensation to be paid to the Chairman of the Board, the President, and each
Vice President above the level of Assistant Vice President.
Section 7. VOTING OF SHARES AND SECURITIES OF OTHER CORPORATIONS.
Unless the Board of Directors otherwise directs, the Company's Chairman of the
Board and President shall each be entitled to vote or designate a proxy to vote
all shares and other securities which the Company owns in any other corporation
or entity.
ARTICLE IV
CAPITAL STOCK
Section 1. CERTIFICATES OF SHARES. The interest of each shareholder
shall be evidenced by a certificate or certificates for shares of stock of the
Company in such form as the Board of Directors may from time to time prescribe.
The
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certificates of stock shall be signed by the Chairman of the Board, the
President or a Vice President and by the Treasurer, an Assistant Treasurer, the
Corporate Secretary, or an Assistant Corporate Secretary of the Company, and
shall be countersigned by a transfer agent for the stock and registered by a
registrar for such stock. The signatures of the officers and the transfer agent
and the registrar upon such certificates may be facsimiles, engraved, or
printed, subject to the provisions of applicable law. In case any officer,
transfer agent, or registrar shall cease to serve in that capacity after their
facsimile signature has been placed on a certificate, the certificates may be
issued with the same effect as if the officer, transfer agent, or registrar were
still in office.
Section 2. TRANSFER OF SHARES. Shares in the capital stock of the
Company shall be transferred on the books of the Company upon surrender and
cancellation of certificates for a like number of shares, with duly executed
power to transfer endorsed on or attached to the certificate.
Section 3. LOST OR DESTROYED STOCK CERTIFICATES. No certificate for
shares of stock of the Company shall be issued in place of any certificate
alleged to have been lost, stolen or destroyed, except upon production of such
evidence of the loss, theft or destruction, and upon indemnification of the
Company and its agents to such extent and in such manner as the Board of
Directors may from time to time prescribe.
ARTICLE V
CHECKS, NOTES, BONDS, DEBENTURES, ETC.
All checks and drafts on the Company's bank accounts, all bills of
exchange and promissory notes, and all acceptances, obligations, and other
instruments for the payment of money, shall be signed by such officer or
officers or agent or agents, either manually or by facsimile signature or
signatures, as shall be thereunto authorized from time to time by the Board of
Directors either generally or in specific instances; provided that bonds,
debentures, and other evidences of indebtedness of the Company bearing facsimile
signatures of officers of the Company shall be issued only when authenticated by
a manual signature on behalf of a trustee or an authenticating agent appointed
by the Board of Directors. In case any such officer of the Company shall cease
to be such after such officer's facsimile signature has been placed thereon,
such bonds, debentures or other evidences of indebtedness may be issued with the
same effect as if such person were still in office.
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ARTICLE VI
CORPORATE SEAL
The Board of Directors shall provide a suitable seal containing the
name of the Company.
ARTICLE VII
CONTROL SHARE ACQUISITIONS
The Stacey, Bennett, and Randall Shareholder Equity Act (Chapter 7B of
the Michigan Business Corporation Act) shall not apply to any control share
acquisitions (as defined in such Act) of shares of the Company.
This Article VII of the Bylaws may not be amended, altered, or repealed
with respect to any control share acquisition of shares of the Company effected
pursuant to a tender offer or other transaction commenced prior to the date of
such amendment, alteration, or repeal.
ARTICLE VIII
AMENDMENT OF BYLAWS
Those provisions of these Bylaws providing for a classified Board of
Directors (currently the third, fourth and fifth sentences of the first
paragraph of Section 1 of Article II) and the provisions of this sentence may be
amended or repealed only by the affirmative vote of the holders of a majority of
shares of Common Stock of the Company. Except as provided in the immediately
preceding sentence, Bylaws of the Company may be amended, repealed or adopted by
vote of the holders of a majority of shares at the time entitled to vote in the
election of any directors or by vote of a majority of the directors in office.
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EXHIBIT 3-12
================================================================================
================================================================================
BYLAWS
of
THE DETROIT EDISON COMPANY
As amended through April 28, 1999
================================================================================
================================================================================
<PAGE> 2
BYLAWS
of
THE DETROIT EDISON COMPANY
--------------------------
INDEX
Page
----
ARTICLE I
Shareholders................................................................1
SECTION 1. Annual Meeting..............................................1
SECTION 2. Special Meetings............................................1
SECTION 3. Notice of Meetings..........................................1
SECTION 4. Quorum......................................................1
SECTION 5. Voting and Inspectors.......................................2
SECTION 6. Record of Shareholders......................................2
SECTION 7. List of Shareholders........................................2
SECTION 8. Order of Business...........................................2
ARTICLE II
Board of Directors and Committees...........................................4
SECTION 1. Number, Time of Holding Office, and Limitation on
Age.........................................................4
SECTION 2. Vacancies...................................................5
SECTION 3. Nominations of Directors; Election..........................5
SECTION 4. Meetings of the Board.......................................6
SECTION 5. Quorum......................................................6
SECTION 6. Annual Meeting of Directors.................................6
SECTION 7. Executive Committee.........................................6
SECTION 8. Committees..................................................7
SECTION 9. Participation in Meetings...................................7
SECTION 10. Compensation................................................7
ARTICLE III
Officers....................................................................7
SECTION 1. Officers and Agents.........................................7
SECTION 2. Term of Office..............................................7
SECTION 3. Chairman of the Board.......................................8
SECTION 4. President...................................................8
SECTION 5. Other Officers..............................................8
SECTION 6. Compensation................................................8
<PAGE> 3
ARTICLE IV
Capital Stock...............................................................8
SECTION 1. Certificates of Shares......................................8
SECTION 2. Transfer of Shares..........................................9
SECTION 3. Lost or Destroyed Stock Certificates....................... 9
ARTICLE V
Checks, Notes, Bonds, Debentures, etc.......................................9
ARTICLE VI
Corporate Seal..............................................................9
ARTICLE VII
Control Share Acquisitions.................................................10
ARTICLE VIII
Amendment of Bylaws........................................................10
ii
<PAGE> 4
BYLAWS
OF
THE DETROIT EDISON COMPANY
AS AMENDED THROUGH MAY 1, 1998
ARTICLE I
SHAREHOLDERS
Section 1. ANNUAL MEETING. The annual meeting of the shareholders of
the Company shall be held on the fourth Wednesday of April in each year (or if
said day be a legal holiday, then on the next succeeding day not a legal
holiday), at such time and at such place as may be fixed by the Board of
Directors and stated in the notice of meeting, for the purpose of electing
directors and transacting such other business as may properly be brought before
the meeting as determined by Article I, Section 8 hereof.
Section 2. SPECIAL MEETINGS. Special meetings of the shareholders may
be held upon call of the Board of Directors or the Chairman of the Board or the
President or the holders of record of three-quarters of the outstanding shares
of stock of the Company, at such time as may be fixed by the Board of Directors
or the Chairman of the Board or the President or such shareholders and stated in
the notice of meeting. All such meetings shall be held at the office of the
Company in the City of Detroit unless some other place is specified in the
notice.
Section 3. NOTICE OF MEETINGS. Written notice of the date, time, place
and purpose or purposes of every meeting of the shareholders, signed by the
Corporate Secretary or an Assistant Corporate Secretary, shall be given either
personally or by mail, within the time prescribed by law, to each shareholder of
record entitled to vote at such meeting and to any shareholder who, by reason of
any action proposed at such meeting, might be entitled to receive payment for
such stock if such action were taken. If mailed, such notice is given when
deposited in the United States mail, with postage thereon prepaid, directed to
the shareholder at the address as it appears on the record of shareholders, or,
if the shareholders shall have filed with the Corporate Secretary of the Company
a written request that notices intended for such shareholder be mailed to some
other address, then directed to the address designated in such request. Further
notice shall be given by mail, publication, or otherwise, if and as required by
law.
Notice of meeting need not be given to any shareholder who submits a
signed waiver of notice, in person or by proxy, whether before or after the
meeting. The attendance of any shareholder at the meeting, in person or by
proxy, without protesting at the beginning of the meeting the lack of notice of
such meeting, shall constitute a waiver
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of notice by such shareholder.
Notice of a special meeting shall also indicate that it is being issued
by or at the direction of the person or persons calling the meeting.
Section 4. QUORUM. At every meeting of the shareholders, the holders of
record of a majority of the outstanding shares of stock of the Company entitled
to vote at such meeting, whether present in person or represented by proxy,
shall constitute a quorum. If at any meeting there shall be no quorum, the
holders of a majority of the outstanding shares of stock so present or
represented may adjourn the meeting from time to time, without notice other than
announcement at the meeting, until a quorum shall have been obtained, when any
business may be transacted which might have been transacted at the meeting as
first convened had there been a quorum. When a quorum is once present to
organize a meeting, it is not broken by the subsequent withdrawal of any
shareholder.
Section 5. VOTING AND INSPECTORS. Each holder of record of outstanding
shares of stock of the Company entitled to vote at a meeting of shareholders
shall be entitled to one vote for each share of stock standing in the
shareholder's name on the record of shareholders, and may so vote either in
person or by proxy appointed by instrument in writing executed by such holder or
by the shareholder's duly authorized attorney-in-fact. No proxy shall be valid
after the expiration of three years from the date of its execution unless the
shareholder executing it shall have specified the length of time it is to
continue in force which shall be for some limited period. The authority of the
holder of a proxy to act shall not be revoked by the incompetence or death of
the shareholder who executed the proxy unless, before the authority is
exercised, written notice of an adjudication of such incompetence or of such
death is received by the Corporate Secretary or an Assistant Corporate
Secretary.
In advance of any meeting of shareholders, the Board of Directors may
appoint one or more inspectors for the meeting. If inspectors are not so
appointed, the chairman of the meeting shall appoint such inspectors. Before
entering upon the discharge of their duties, the inspectors shall take and
subscribe an oath faithfully to execute the duties of inspector at such meeting
with strict impartiality and according to the best of their ability, and shall
take charge of the polls and after balloting shall make a certificate of the
result of the vote taken. No officer or director of the Company or candidate for
office of director shall be appointed as an inspector. At all elections of
directors, the voting shall be by ballot and a plurality of the votes cast shall
elect.
Section 6. RECORD OF SHAREHOLDERS. For the purpose of determining the
shareholders entitled to notice of or to vote at any meeting of shareholders or
any adjournment thereof, or to express consent to or dissent from any proposal
without a meeting, or for the purpose of determining shareholders entitled to
receive payment of any dividend or the allotment of any rights, or for the
purpose of any other action, the Board of Directors may fix, in advance, a date
as the record date for any such determination of shareholders, which record date
shall not less than 10 days nor more than the maximum number of days permitted
by law before the date of the meeting, or taking of any other action.
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Section 7. LIST OF SHAREHOLDERS. A list of shareholders as of the
record date, certified by the Corporate Secretary or any Assistant Corporate
Secretary or by a transfer agent, shall be produced at any meeting of
shareholders upon the request thereat or prior thereto of any shareholder. If
the right to vote at any meeting is challenged, the inspectors, or the person
presiding at the meeting, shall require such list of shareholders to be produced
as evidence of the right of the persons challenged to vote at such meeting, and
all persons who appear on such list to be shareholders entitled to vote thereat
may vote at such meeting.
Section 8. ORDER OF BUSINESS. (a) The Chairman, or such other officer
of the Company designated by a majority of the total number of directors that
the Company would have if there were no vacancies on the Board of Directors
(such number being referred to as the "Whole Board"), will call meetings of
shareholders to order and will act as presiding officer thereof. Unless
otherwise determined by the Board of Directors prior to the meeting, the
presiding officer of the meeting of shareholders will also determine the order
of business and have the authority in his or her sole discretion to regulate the
conduct of any such meeting including, without limitation, by imposing
restrictions on the persons (other than shareholders of the Company or their
duly appointed proxies) who may attend any such shareholders' meeting, by
ascertaining whether any shareholder or his proxy may be excluded from any
meeting of shareholders based upon any determination by the presiding officer,
in his or her sole discretion, that any such person has unduly disrupted or is
likely to disrupt the proceedings of the meeting, and by determining the
circumstances in which any person may make a statement or ask questions at any
meeting of shareholders.
(b) At an annual meeting of the shareholders, only such business will
be conducted or considered as is properly brought before the meeting. To be
properly brought before an annual meeting, business must be (i) specified in the
notice of meeting (or any supplement thereto) given by or at the direction of
the Chairman, the President, a Vice President, the Corporate Secretary or an
Assistant Corporate Secretary in accordance with Section 3 of this Article I;
(ii) otherwise properly brought before the meeting by the presiding officer or
by or at the direction of a majority of the Whole Board; or (iii) otherwise
properly requested to be brought before the meeting by a shareholder of the
Company in accordance with Section 8(c) below.
(c) For business to be properly requested by a shareholder to be
brought before an annual meeting, the shareholder must (i) be a shareholder of
the Company of record at the time of the giving of the notice for such annual
meeting provided for in these Bylaws; (ii) be entitled to vote at such meeting;
and (iii) have given timely notice thereof in writing to the Corporate
Secretary. To be timely, a shareholder's notice must be delivered to or mailed
and received at the principal executive offices of the Company not less than 60
nor more than 90 calendar days prior to the annual meeting; provided, however,
that in the event public announcement of the date of the annual meeting is not
made at least 100 calendar days prior to the date of the annual meeting, notice
by the shareholder to be timely must be so received not later than the close of
business on the 10th calendar day following the day on which public announcement
is first made of the date of the annual
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<PAGE> 7
meeting. A shareholder's notice to the Corporate Secretary must set forth as to
each matter the shareholder proposes to bring before the annual meeting: (A) a
description in reasonable detail of the business desired to be brought before
the annual meeting and the reasons for conducting such business at the annual
meeting; (B) the name and address, as they appear on the Company's books, of the
shareholder proposing such business and of the beneficial owner, if any, on
whose behalf the proposal is made; (C) the class and number of shares of the
Company that are owned beneficially and of record by the shareholder proposing
such business and by the beneficial owner, if any, on whose behalf the proposal
is made; and (D) any material interest in such business of such shareholder
proposing such business and the beneficial owner, if any, on whose behalf the
proposal is made. Notwithstanding the foregoing provisions of this Section 8(c),
a shareholder must also comply with all applicable requirements of the
Securities Exchange Act of 1934, as amended, and the rules and regulations
thereunder with respect to the matters set forth in this Section 8(c). For
purposes of this Section 8(c) and Section 3 of Article II, "public announcement"
means disclosure in a press release reported by the Dow Jones News Service,
Associated Press, or comparable national news service or in a document publicly
filed by the Company with the Securities and Exchange Commission pursuant to
Sections 13, 14, or 15(d) of the Securities Exchange Act of 1934, as amended, or
publicly filed by the Company with any national securities exchange or quotation
service through which the Company's
4
<PAGE> 8
stock is listed or traded, or furnished by the Company to its shareholders.
Nothing in this Section 8(c) will be deemed to affect any rights of shareholders
to request inclusion of proposals in the Company's proxy statement pursuant to
Rule 14a-8 under the Securities Exchange Act of 1934, as amended.
(d) At a special meeting of shareholders, only such business may be
conducted or considered as is properly brought before the meeting. To be
properly brought before a special meeting, business must be (i) specified in the
notice of the meeting (or any supplement thereto) given by or at the direction
of the Chairman, the President, a Vice President, the Corporate Secretary or an
Assistant Corporate Secretary (or in case of their failure to give any required
notice, the other persons entitled to give notice) in accordance with Section 3
of Article I or (ii) otherwise brought before the meeting by the presiding
officer or by or at the direction of a majority of the Whole Board.
(e) The determination of whether any business sought to be brought
before any annual or special meeting of the shareholders is properly brought
before such meeting in accordance with this Section 8 will be made by the
presiding officer of such meeting. If the presiding officer determines that any
business is not properly brought before such meeting, he or she will so declare
to the meeting and any such business will not be conducted or considered.
ARTICLE II
BOARD OF DIRECTORS AND COMMITTEES
Section 1. NUMBER, TIME OF HOLDING OFFICE AND LIMITATION ON AGE. The
business and affairs of the Company shall be managed and controlled by a Board
of Directors. The number of directors constituting the Whole Board shall be
determined from time to time by resolution of the Board so long as the total
number of directors is not less than ten nor more than eighteen; provided,
however, that the minimum and maximum number of directors may be increased or
decreased from time to time by vote of a majority of the Whole Board; and,
further provided that no change in the number of directors shall serve to
shorten the term of office of any incumbent director. Commencing with the annual
election of directors by the shareholders in 1991, the directors shall be
divided into three classes, as nearly equal in number as possible, and the term
of office of the first class shall expire at the 1992 annual meeting of
shareholders, the term of office of the second class shall expire at the 1993
annual meeting of shareholders and the term of office of the third class shall
expire at the 1994 annual meeting of shareholders, or, in each case, until their
successors shall be duly elected and qualified. At each annual meeting
commencing in 1992, a number of directors equal to the number of the class whose
term expires at the time of the meeting shall be elected to hold office until
the third succeeding annual meeting of shareholders. In the event the holders of
the Preferred Stock or the Preference Stock are entitled to elect directors as
provided in Article V, Division I, subdivision (9) or Article V, Division II,
subdivision (9) of the Restated Articles of Incorporation of the Company, then
the provisions of such class of stock with respect to their rights shall apply
and such directors shall be elected for terms expiring at the next annual
meeting of shareholders and without regard to the classification of the
remaining
5
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members of the Board of Directors.
Except as hereinafter provided, each director shall be a holder of
Common Stock of DTE Energy Company at the time of initial election to the Board
or shall become a holder within thirty days after such election (to the extent
of at least one share, owned beneficially) and any director who thereafter
ceases to be such a holder, shall thereupon cease to be a director. The Board
shall have the authority to waive the
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<PAGE> 10
requirement to hold shares in individual situations upon presentation of
evidence that a nominee or director is unable to hold shares for legal or
religious reasons.
No person who shall have served as an employee of the Company or an
affiliate shall be elected a director after retiring from employment with the
Company or an affiliate; provided, however, that if such person was the Chief
Executive Officer of the Company at the time of such retirement, such person
shall be eligible for election as a director until attaining age 70. No other
person shall be elected a director after attaining age 70; provided, however,
the Board shall have the authority to waive this provision for no more than one
three-year term upon a determination that circumstances exist which make it
prudent to continue the service of a director who possesses special and unique
expertise clearly beneficial to the Company.
Section 2. VACANCIES. Whenever any vacancy shall occur in the Board of
Directors by death, resignation, or any other cause, it shall be filled without
undue delay by a majority vote of the remaining members of the Board of
Directors and the person who is to fill any such vacancy shall hold office for
the unexpired term of the director to whom such person succeeds, or for the term
fixed by the Board of Directors acting in compliance with Section l of this
Article II in case of a vacancy created by an increase in the number of
directors, and until a successor shall be elected and shall have qualified;
provided, however, that no vacancy need be filled if, after such vacancy shall
occur, the number of directors remaining on the Board shall be not less than a
majority of the whole Board. During the existence of any vacancy or vacancies,
the surviving or remaining directors shall possess and may exercise all the
powers of the full Board of Directors, when action by a larger number is not
required by law.
Section 3. NOMINATIONS OF DIRECTORS; ELECTION. (a) Except as may be
otherwise provided in any resolution establishing any Preferred or Preference
Stock, only persons who are nominated in accordance with this Section 3 will be
eligible for election at a meeting of shareholders to be members of the Board of
Directors of the Company.
(b) Nominations of persons for election as directors of the Company may
be made only at an annual meeting of shareholders (i) by or at the direction of
the Board of Directors or a committee thereof or (ii) by any shareholder who is
a shareholder of record at the time of giving of notice provided for in this
Section 3, who is entitled to vote for the election of directors at such
meeting, and who complies with the procedures set forth in this Section 3. All
nominations by shareholders must be made pursuant to timely notice in proper
written form to the Corporate Secretary.
(c) To be timely, a shareholder's notice must be delivered to or mailed
and received at the principal executive offices of the Company not less than 60
nor more than 90 calendar days prior to the annual meeting of shareholders;
provided, however, that in the event that public announcement of the date of the
annual meeting is not made at least 100 calendar days prior to the date of the
annual meeting, notice by the shareholder to be timely must be so received not
later than the close of business on the 10th calendar day following the day on
which public announcement (as defined in Section 8(c) of Article I) is first
made of the date of the annual meeting. To be in proper written form, such
7
<PAGE> 11
shareholder's notice must set forth or include: (i) the name and address, as
they appear on the Company's books, of the shareholder giving the notice and of
the beneficial owner, if any, on whose behalf the nomination is made; (ii) a
representation that the shareholder giving the notice is a holder of record of
stock of the Company entitled to vote at such annual meeting and intends to
appear in person or by proxy at the annual meeting to nominate the person or
persons specified in the notice; (iii) the class and number of shares of stock
of the Company owned beneficially and of record by the shareholder giving the
notice and by the beneficial owner, if any, on whose behalf the nomination is
made; (iv) a description of all arrangements or understandings between or among
any of (A) the shareholder giving the notice, (B) the beneficial owner on whose
behalf the notice is given, (C) each nominee, and (D) any other person or
persons (naming such person or persons) pursuant to which the nomination or
nominations are to be made by the shareholder giving the notice; (v) such other
information regarding each nominee proposed by the shareholder giving the notice
as would be required to be included in a proxy statement filed pursuant to the
proxy rules of the Securities and Exchange Commission had the nominee been
nominated, or intended to be nominated, by the Board of Directors; and (vi) the
signed consent of each nominee to serve as a director of the Company if so
elected. The presiding officer of any annual meeting may, if the facts warrant,
determine that a nomination was not made in accordance with this Section 3, and
if he or she should so determine, he or she will so declare to the meeting, and
the defective nomination will be disregarded. Notwithstanding the foregoing
provisions of this Section 3, a shareholder must also comply with all applicable
requirements of the Securities Exchange Act of 1934, as amended, and the rules
and regulations thereunder with respect to the matters set forth in this Section
3.
Section 4. MEETINGS OF THE BOARD. Regular meetings of the Board of
Directors shall be held at such times and at such places as may from time to
time be fixed by the Board of Directors.
Special meetings of the Board of Directors may be called by the
Chairman of the Board or the President or, in the event of the incapacity of the
Chairman of the Board and the President, the Executive Committee by giving
reasonable notice of the time and place of such meetings or by obtaining written
waivers of notice, before or after the meeting, from each absent director. All
such meetings shall be held at the office of the Company in the City of Detroit
unless some other place is specified in the notice.
A notice, or waiver of notice, need not specify the purpose of the
meeting.
Section 5. QUORUM A majority of the directors in office at the time of
a meeting of the Board shall constitute a quorum for the transaction of
business, but if at any meeting of the Board of Directors there shall be less
than a quorum present, a majority of the directors present may adjourn the
meeting from time to time without notice other than announcement at the meeting,
until a quorum shall have been obtained, when any business may be transacted
which might have been transacted at the meeting as first convened had there been
a quorum. The acts of a majority of the directors present at any meeting at
which there is a quorum shall be the acts of the Board, unless otherwise
provided by law, by the Restated Articles of Incorporation or by the Bylaws.
8
<PAGE> 12
Section 6. ANNUAL MEETING OF DIRECTORS. A meeting of the Board of
Directors, known as the directors' annual meeting, shall be held without notice
each year after the adjournment of the annual shareholders' meeting and on the
same day, and at such meeting the officers of the Company for the ensuing year
shall be elected. If a quorum of the directors is not present on the day
appointed for the directors' annual meeting, the meeting shall be adjourned to
some convenient day.
Section 7. EXECUTIVE COMMITTEE. The Board of Directors may, by
resolution or resolutions passed by a majority of the Whole Board, designate an
Executive Committee to consist of the Chief Executive Officer and two or more of
the other directors, and alternates, and shall designate the Chairman thereof.
The Executive Committee shall have and may exercise, when the Board is not in
session, all of the powers of the Board in the management of the business and
affairs of the Company, and shall have power to authorize the seal of the
Company to be affixed to all papers which may require it; but the Executive
Committee shall not have power to declare dividends, to change the number of
directors constituting the Whole Board, to fill vacancies in the Board, or to
establish or change the membership of, or to fill vacancies in, any committee,
or to fix the compensation of the directors or committee members, or to make or
amend Bylaws of the Company, or to submit matters for action by shareholders, or
to amend or repeal a resolution of the Board which by its terms may not be
changed by the Executive Committee. The Board shall have the power at any time
to fill vacancies in, to change the membership of, or to dissolve, the Executive
Committee. The Executive Committee may make rules for the conduct of its
business and may appoint such subcommittees and assistants as it shall from time
to time deem necessary. A majority of the members of the Executive Committee
shall constitute a quorum. All action taken by the Executive Committee shall be
reported to the Board at its next meeting succeeding such action. The Corporate
Secretary or an Assistant Corporate Secretary shall attend and act as the
secretary of all meetings of the Executive Committee and keep the minutes
thereof.
Meetings of the Executive Committee may be called by the Chairman of
the Board or the President, or, in the event of the incapacity of the Chairman
of the Board and the President, by two or more members of the Executive
Committee by giving reasonable notice of the time and place of such meetings.
All such meetings shall be held at the office of the Company in the City of
Detroit unless some other place is specified in the notice.
Section 8. COMMITTEES. The Board of Directors may, by resolution,
create a committee or committees of one or more directors, and alternates, to
consider and report upon or to carry out such matters (not excepted by the
foregoing section) as may be entrusted to them by the Board of Directors, and
shall designate the Chairman of each such committee.
Section 9. PARTICIPATION IN MEETINGS. One or more members of the Board
of Directors or any committee thereof may participate in any meeting of such
Board or such committee by means of a conference telephone or similar
communications equipment which enables all persons participating in such a
meeting to hear each other at the same
9
<PAGE> 13
time and the participation in the manner so described shall constitute presence
in person at such meetings.
Section 10. COMPENSATION. Each director of the Company who is not a
salaried officer or employee of the Company may receive reasonable compensation
for services as a director, including a reasonable fee for attendance at
meetings of the Board and committees thereof, and attendance at the Company's
request at other meetings or similar activities related to the Company.
ARTICLE III
OFFICERS
Section 1. OFFICERS AND AGENTS. The officers of the Company to be
elected by the Board of Directors, as soon as practicable after the election of
directors each year, shall be Chairman of the Board, the President, a Corporate
Secretary and a Treasurer. The Board of Directors may also from time to time
elect one or more Vice Presidents, a Controller, a General Auditor, a General
Counsel, and such other officers and agents as it may deem proper. The Chairman
of the Board and the President shall be chosen from among the directors. The
persons holding the offices of Chairman of the Board or President may not
10
<PAGE> 14
also hold the office of General Auditor. The Board of Directors may, in its
discretion, leave vacant any office other than that of Chairman of the Board,
President, Corporate Secretary or Treasurer.
Section 2. TERM OF OFFICE. The term of office of all officers shall be
until the next directors' annual meeting of or until their respective successors
are chosen and qualified; but any officer or agent elected by the Board of
Directors may be removed by the Board at any time, with or without cause.
Section 3. CHAIRMAN OF THE BOARD. The Chairman of the Board shall be
the chief executive officer of the Company, shall preside at all meetings of the
Board of Directors and, subject to Section 8(a) of Article I, meetings of
shareholders, at which the Chairman is present, and shall make the annual report
to the shareholders The Chairman shall have general charge of the business and
affairs of the Company subject to the control of the Board of Directors, may
execute in the name of the Company any authorized corporate obligation or other
instrument and shall perform such other functions as may be prescribed by the
Board from time to time.
The Chairman of the Board shall manage or supervise the conduct of the
corporate finances and relations of the Company with its shareholders, with the
public and with regulatory authorities and in addition to the President, may
exercise all powers elsewhere in the Bylaws conferred upon the President. The
Chairman may delegate from time to time to the President or to other officers,
employees or positions of the Company, such powers as the Chairman may specify
in writing, with such terms and conditions, if any, as the Chairman may set
forth. A copy of each such delegation and of any revocation or change shall be
filed with the Corporate Secretary.
Section 4. PRESIDENT. The President shall be the chief operating
officer of the Company, subject to the control of the Board of Directors and the
Chairman of the Board, shall have power to authorize the employment of such
subordinate employees as may, in the President's judgment, be advisable for the
operations of the Company, may execute in the name of the Company any authorized
corporate obligation or other instrument and shall perform all other acts
incident to the President's office or prescribed by the Board of Directors or
the Chairman of the Board, or authorized or required by law. During the absence
or disability of the Chairman of the Board, the President shall assume the
duties and authority of the Chairman of the Board and shall be the chief
executive officer of the Company.
SECTION 5. OTHER OFFICERS. The other officers, agents and employees of
the Company shall each have such powers and perform such duties in the
management of the property and affairs of the Company, subject to the control of
the Board of Directors, as generally pertain to their respective offices, as
well as such powers and duties as from time to time may be prescribed by the
Board of Directors, by the Chairman of the Board or by the President.
Section 6. COMPENSATION. The Board of Directors shall determine the
compensation to be paid to the Chairman of the Board, the President and each
Vice
11
<PAGE> 15
President above the level of Assistant Vice President.
12
<PAGE> 16
ARTICLE IV
CAPITAL STOCK
Section 1. CERTIFICATES OF SHARES. The interest of each shareholder
shall be evidenced by a certificate or certificates for shares of stock of the
Company in such form as the Board of Directors may from time to time prescribe.
The certificates of stock shall be signed by the Chairman of the Board, the
President or a Vice President and by the Treasurer, an Assistant Treasurer, the
Corporate Secretary, or an Assistant Corporate Secretary of the Company, shall
be sealed with the seal of the Company or a facsimile thereof, and shall be
countersigned by a transfer agent for the stock and registered by a registrar
for such stock. The signatures of the officers and the transfer agent and the
registrar upon such certificates may be facsimiles, engraved or printed, subject
to the provisions of applicable law. In case any officer, transfer agent or
registrar shall cease to serve in that capacity after their facsimile signature
has been placed on a certificate, the certificates may be issued with the same
effect as if the officer, transfer agent or registrar were still in office.
Section 2. TRANSFER OF SHARES. Shares in the capital stock of the
Company shall be transferred on the books of the Company upon surrender and
cancellation of certificates for a like number of shares, with duly executed
power to transfer endorsed thereon or attached to the certificate.
Section 3. LOST OR DESTROYED STOCK CERTIFICATES. No certificate for
shares of stock of the Company shall be issued in place of any certificate
alleged to have been lost, stolen or destroyed, except upon production of such
evidence of the loss, theft or destruction, and upon indemnification of the
Company and its agents to such extent and in such manner as the Board of
Directors may from time to time prescribe.
ARTICLE V
CHECKS, NOTES, BONDS, DEBENTURES, ETC.
All checks and drafts on the Company's bank accounts and all bills of
exchange and promissory notes, and all acceptances, obligations and other
instruments for the payment of money, shall be signed by such officer or
officers or agent or agents, either manually or by facsimile signature or
signatures, as shall be thereunto authorized from time to time by the Board of
Directors either generally or in specific instances; provided that bonds,
debentures and other evidences of indebtedness of the Company bearing facsimile
signatures of officers of the Company shall be issued only when authenticated by
a manual signature on behalf of a trustee or an authenticating agent appointed
by the Board of Directors and in case any such officer of the Company shall
cease to be such after such officer's facsimile signature has been placed
thereon, such bonds, debentures or other evidences of indebtedness may be issued
with the same effect as if such person were still in office.
13
<PAGE> 17
ARTICLE VI
CORPORATE SEAL
The Board of Directors shall provide a suitable seal containing the
name of the Company.
14
<PAGE> 18
ARTICLE VII
CONTROL SHARE ACQUISITIONS
The Stacey, Bennett, and Randall Shareholder Equity Act (Chapter 7B of
the Michigan Business Corporation Act) shall not apply to any control share
acquisitions (as defined in such Act) of shares of the Company.
This Article VII of the Bylaws may not be amended, altered or repealed
with respect to any control share acquisition of shares of the Company effected
pursuant to a tender offer or other transaction commenced prior to the date of
such amendment, alteration or repeal.
ARTICLE VIII
AMENDMENT OF BYLAWS
Those provisions of these Bylaws providing for a classified Board of
Directors (currently the third, fourth and fifth sentences of the first
paragraph of Section 1 of Article II) and the provisions of this sentence may be
amended or repealed only by the vote of the holders of a majority of shares of
Common Stock of the Company. Except as provided in the immediately preceding
sentence, Bylaws of the Company may be amended, repealed or adopted by vote of
the holders of a majority of shares at the time entitled to vote in the election
of any directors or by vote of a majority of the directors in office.
15
<PAGE> 1
EXHIBIT 4-202
SUPPORT AGREEMENT BETWEEN
DTE ENERGY COMPANY
AND
DTE CAPITAL CORPORATION
THIS SUPPORT AGREEMENT, dated as of February 24, 1999 ("1999
Agreement"), is between DTE ENERGY COMPANY, a Michigan corporation ("Parent"),
and DTE CAPITAL CORPORATION, a Michigan corporation ("Subsidiary").
WHEREAS, Parent is the owner of 100% of the outstanding common stock of
Subsidiary; and further
WHEREAS, Subsidiary, from time to time, intends to guarantee up to $100
million in the aggregate of the obligations of DTE Energy Trading, Inc., a
Michigan corporation and affiliate of Parent ("Trading"), and DTE-CoEnergy,
L. L.C., formed in Michigan and an affiliate of Parent and Subsidiary
("DTE-CoEnergy") and $60 million aggregate principal amount of such guarantees
have the benefit of a Support Agreement, dated as of January 21, 1998, between
Parent and Subsidiary ("1998 Agreement"); and further
WHEREAS, Parent and Subsidiary have agreed that the 1999 Agreement
shall initially be in the amount of $40 million and shall increase to $100
million at such times and in such amounts as obligations having the benefit of
the 1998 Agreement are extinguished; and further
WHEREAS, Subsidiary may from time to time make borrowings from the
lenders party to the $400,000,000 Second Amended and Restated Credit Agreement
(such agreement as it may be amended and in effect from time to time, the
"Credit Agreement"), dated as of January 19, 1999 among the Subsidiary, the
lenders party thereto, Citibank, N.A., as Agent and ABN AMRO Bank, N.V.,
Barclays Bank PLC., Bayerische Landesbank Girozentrale, Cayman Islands Branch,
Comerica Bank, Den Danske Bank Aktieselkab and The First National Bank of
Chicago, as Co-Agents; and further
WHEREAS, Parent and Subsidiary desire to take certain actions to
continue to enhance and maintain the financial condition of Subsidiary as
hereinafter set forth in order to enable Subsidiary and Trading and DTE-CoEnergy
to guarantee and incur indebtedness, respectively, on more advantageous and
reasonable terms; and further
<PAGE> 2
WHEREAS, the parties receiving guarantees from Subsidiary of the
obligations of Trading and/or DTE-CoEnergy may rely upon this 1999 Agreement in
extending credit to Trading and/or DTE-CoEnergy and in accepting Subsidiary's
guarantee(s);
NOW, THEREFORE, in consideration of the premises, and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the Parent and Subsidiary agree as follows:
1. STOCK OWNERSHIP. During the term of this 1999 Agreement, Parent
will own all of the voting common stock of Subsidiary and The
Detroit Edison Company ("DECo") now or hereafter issued and
outstanding.
2. NEGATIVE PLEDGE. During the term of this 1999 Agreement, Parent
will not create or suffer to exist any lien, security interest or
other charge or encumbrance, upon or with respect to any voting
common stock of DECo from time to time owned by Parent or any
capital stock of Subsidiary from time to time owned by Parent,
provided, however, that any restriction on the payment of
dividends by DECo or Subsidiary contained in any subordinated debt
instrument, preferred stock or preference stock of DECo or
Subsidiary shall not constitute a lien, security interest or other
charge or encumbrance,
3. LIQUIDITY PROVISION. If, during the term of this 1999 Agreement,
Subsidiary is unable to make timely payment of such amounts as
shall be due and payable pursuant to a guarantee issued by
Subsidiary and running to the benefit of any obligee ("Obligee")
of Trading and/or DTE-CoEnergy, then, Parent promptly shall
provide to Subsidiary, at its request, such funds (in the form of
cash or liquid assets) in an amount sufficient to permit
Subsidiary to make timely payment in respect of such guarantee. If
such funds are advanced to Subsidiary as a loan, such loan shall
be on such terms and conditions, including maturity and rate of
interest, as Parent and Subsidiary shall agree. Notwithstanding
the foregoing, any such loan shall be subordinated to any and all
obligations of Subsidiary owing to any Lender pursuant to the
terms of the Credit Agreement and such amounts as shall be owing
pursuant to guarantees issued by Subsidiary for the benefit of
Obligees of Trading and/or DTE-CoEnergy. Each of the parties
hereto acknowledges that Parent's obligations hereunder do not
constitute a guarantee by Parent of the obligations of Subsidiary.
2
<PAGE> 3
4. WAIVERS. Parent hereby waives any failure or delay on the part of
Subsidiary in asserting or enforcing any of its rights or in
making any claims or demands hereunder.
5. AMENDMENT, - SUSPENSION. This 1999 Agreement may be amended or
terminated at any time by written amendment or agreement signed by
both parties; provided, however, that except as set forth in the
next succeeding sentence, no amendment to the 1999 Agreement which
adversely affects the rights of Subsidiary or any Obligee and no
termination of this 1999 Agreement shall be effective as to
Subsidiary or any Obligee until such time as all amounts
contingently owing to all Obligees by Subsidiary on the date of
such amendment or termination shall have been paid in full or
adequate provision has been made for the payment of same unless
such Obligees shall consent in writing to the contrary.
6. RIGHTS OF OBLIGEE. Subsidiary hereby grants to the Obligees,
Subsidiary's rights under Sections 1, 2, 3 and 4 of this 1999
Agreement, and, if Subsidiary fails or refuses to take timely
action to enforce its rights under Sections 1, 2, 3 or 4 of this
1999 Agreement, any Obligee may enforce such rights on behalf of
Subsidiary directly against Parent. Parent hereby consents to such
grant.
7. PARITY. Parent's obligations hereunder shall be pari passau with
Parent's obligations (a) under that certain Support Agreement
("Credit Agreement Support Agreement") dated as of January 19,
1999, between Parent and Subsidiary and relating to the Credit
Agreement and (b) under such additional support agreements as are
contemplated by the Credit Agreement Support Agreement.
8. NOTICES. Any notice, instruction, request, consent, demand or
other communication required or contemplated by this 1999
Agreement shall be in writing, shall be given or made by United
States first class mail, telex, facsimile transmission or hand
delivery, addressed as follows:
If to parent: 2000 2nd Avenue
Detroit, Michigan 48226-1279
Attention: Assistant Treasurer-Banking
Telephone: (313) 235-6898
Facsimile: (313) 235-9490
3
<PAGE> 4
If to Subsidiary: 2000 2nd Avenue, 833 WCB
Detroit, Michigan 48226-1279
Attention: Assistant Treasurer
Telephone: (313) 235-6898
Facsimile: (313) 235-9490
9. SUCCESSORS. This 1999 Agreement shall be binding upon the parties
hereto and their respective successors and assigns and is also
intended for the benefit of Obligees, and, notwithstanding that
such Obligees are not parties hereto, Obligees shall be entitled
to the full benefits of this Agreement and to enforce the
covenants and agreements contained herein as set forth in Section
6. This Agreement is not intended for the benefit of any person
other than Obligees and shall not confer or be deemed to confer
upon any such person any benefits, rights or remedies hereunder.
10. GOVERNING LAW. This Agreement shall be governed by the laws of the
State of Michigan.
DTE ENERGY COMPANY
BY
---------------------------------
NAME: L. L. LOOMANS
TITLE: VICE-PRESIDENT AND TREASURER
DTE CAPITAL CORPORATION
BY
---------------------------------
NAME: C. C. ARVANI
TITLE: ASSISTANT TREASURER
4
<PAGE> 1
EXHIBIT 10-32
1999 SVIP-A MEASURES
<TABLE>
<CAPTION>
CATEGORY MEASURE
WEIGHT TARGETS
LEVEL 1 LEVEL 2 LEVEL 3
<S> <C> <C> <C> <C> <C>
FINANCIAL DETROIT EDISON EPS 30% $2.91 $2.77 N/A
Interpolate between Level 1 and 2 (budget)
TOTAL O&M AND CAPITAL BUDGET 10% $1.530 Billion $1.561 Billion N/A
(budget)
EMPLOYEE FOCUS CORPORATE SAFETY LWDC 10% 8 15 21
(top 5%) (top 10%) (5 yr avg top
quartile)
CUSTOMER SATISFACTION OVERALL RESIDENTIAL CUSTOMER 15% 88% 87% 86%
SATISFACTION (top quartile)
LEADERSHIP INITIATIVE MINORITY SUPPLIER EXPENDITURES - 5% 6.0% 5.5% 5.0%
PERCENT OF TOTAL EXPENDITURES
DIVERSITY - INCREASE THE NUMBER OF 5% Minorities 26% Minorities 22% CEO/Board's
MINORITIES AND WOMEN IN BANDS 6 Women 30% Women 25% discretion based on
THROUGH 10 BY ATTAINING PLACEMENT RATE opportunities
TARGETS (TARGETS COVER BOTH PROMOTIONS
AND NEW HIRES)
</TABLE>
<PAGE> 2
<TABLE>
<CAPTION>
CATEGORY MEASURE
WEIGHT TARGETS
LEVEL 1 LEVEL 2 LEVEL 3
<S> <C> <C> <C> <C> <C>
GALLUP SURVEY - PERCENT PARTICIPATION 5% 70% 60% 50%
GALLUP SURVEY - RESULTS ON "OPINIONS
COUNT" SURVEY QUESTION 10% 2.93 2.84 2.76
(baseline 2.68)
Y2000 Y2000 10% Board discretion on
level achieved
</TABLE>
<PAGE> 1
EXHIBIT 10-33
1999 EXECUTIVE INCENTIVE PLAN
<TABLE>
<CAPTION>
MEASURE WEIGHT LEVEL 1 LEVEL 2
<S> <C> <C> <C>
FERMI-PLANT PERFORMANCE 20% Consistently excellent Continued improving performance:
performance: Indicators Indicators include a capacity
include a capacity factor factor at or above 86%, regulat-
at or above 93%, regulatory ory performance (Licensee Event
performance (Licensee Event Reports and Notices of Violation)
Reports and Notices of in the top half of plants in the
Violation) in the top region, and an INPO rating of 2.
quartile of plants in the
region, and an INPO rating
of 1 or 2.
RESTRUCTURING: WHILE MAINTAINING POSITIVE 20% Board discretion on level achieved
RELATIONSHIP WITH THE MPSC, ACHIEVE THE
FOLLOWING OUTCOMES: RETAIN FERMI
RECOVERY, IMPLEMENT ELECTRIC CHOICE IN
ACCORDANCE WITH MARCH, 1999 ORDERS AND
OBTAIN MPSC PRE-APPROVAL ON IMPLEMENTATION
COSTS AND FERMI CAPITAL ADDITIONS
PRICE/EARNINGS MULTIPLE 20% Top Half of DJEU Third Quartile of DJEU (44 utilities)
(44 utilities) (1998 - fourth quartile)
PEOPLE STRATEGY: MILESTONES TO BE IDENTIFIED 20% TBD TBD
AND TARGETS SET BY APRIL 30, 1999
BUSINESS GROWTH: EARNINGS - NON-UTILITY SUBS 20% $.55/share $.45/share
MINUS HOLDING COMPANY AND DTE CAPITAL (1998 - $.29/share)
(INTERPOLATE BETWEEN LEVEL 1 AND LEVEL 2)
</TABLE>
<PAGE> 1
EXHIBIT 11-15
DTE ENERGY COMPANY
BASIC AND DILUTED EARNINGS PER SHARE
OF COMMON STOCK
<TABLE>
<CAPTION>
Three Months Ended March 31, 1999
------------------------------------
(Thousands, except per share amounts)
<S> <C>
BASIC:
Net Income........................................................ $ 115,142
Weighted average number of common
shares outstanding (a).......................................... 145,057
Earnings per share of Common Stock
based on weighted average number
of shares outstanding........................................... $ 0.79
DILUTED:
Net Income........................................................ $ 115,142
Weighted average number of common
shares outstanding (a).......................................... 145,057
Incremental shares from assumed exercise
of options...................................................... 113
-----------------
145,170
=================
Earnings per share of Common Stock
assuming exercise of options.................................... $ 0.79
</TABLE>
- ----------------------------------------------
(a) Based on a daily average.
<PAGE> 1
EXHIBIT 12-16
DTE ENERGY COMPANY
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
<TABLE>
<CAPTION>
Three
Months Year Ended December 31
Ended ------------------------------------------
3/31/99 1998 1997 1996
------- ---- ---- ----
(Millions, except for ratio and percent)
<S> <C> <C> <C> <C>
Net income............................................. $ 115 $ 443 $ 417 $ 309
----------- ----------- ----------- -----------
Taxes based on income:
Income taxes........................................ 14 154 257 221
Municipal and state................................. 1 3 4 3
---------- ----------- ----------- -----------
Total taxes based on income....................... 15 157 261 224
---------- ----------- ----------- -----------
Fixed charges:
Interest expense.................................... 83 319 297 291
Allowance for funds used during
construction...................................... 2 - - -
Interest factor of rents............................ 9 34 34 34
Preferred stock dividend factor..................... - 7 18 26
---------- ----------- ----------- -----------
Total fixed charges............................... 94 360 349 351
---------- ----------- ----------- -----------
Earnings before taxes based on income
and fixed charges................................... $ 224 $ 960 $ 1,027 $ 884
=========== =========== =========== ===========
Ratio of earnings to fixed charges 2.38 2.67 2.94 2.52
Preferred stock dividends.............................. $ - $ 6 $ 12 $ 16
Dividends meeting requirement of
IRC Section 247..................................... $ - $ 4 $ 4 $ 4
Percent deductible for income tax purposes............. - 40.00% 40.00% 40.00%
Amount deductible...................................... - 2 2 2
Amount not deductible.................................. - 4 10 14
Ratio of pretax income to net income................... - 1.351 .61 1.69
Dividend factor for amount not deductible.............. - 5 16 24
Amount deductible...................................... - 2 2 2
----------- ----------- ----------- -----------
Total preferred stock dividend factor............. $ - $ 7 $ 18 $ 26
=========== =========== =========== ===========
</TABLE>
<PAGE> 1
EXHIBIT 12-17
THE DETROIT EDISON COMPANY
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
<TABLE>
<CAPTION>
Three
Months Year Ended December 31
Ended ---------------------------------------------
3/31/99 1998 1997 1996
------- ---- ---- ----
(Millions, except for ratio)
<S> <C> <C> <C> <C>
Net income............................................. $ 104 $ 418 $ 417 $ 328
----------- ----------- ---------- -----------
Taxes based on income:
Income taxes........................................ 49 260 288 225
Municipal and state................................. 1 3 4 3
---------- ----------- ---------- -----------
Total taxes based on income....................... 50 263 292 228
---------- ----------- ---------- -----------
Fixed charges:
Interest expense.................................... 68 278 282 291
Allowance for funds used during
construction...................................... 2 - - -
Interest factor of rents............................ 9 34 34 34
---------- ----------- ---------- -----------
Total fixed charges............................... 79 312 316 325
========== =========== ========== ===========
Earnings before taxes based on income
and fixed charges................................... $ 233 $ 933 $ 1,025 $ 881
=========== =========== ========== ===========
Ratio of earnings to fixed charges 2.94 3.18 3.24 2.71
</TABLE>
<PAGE> 1
EXHIBIT 15-10
DTE Energy Company and
The Detroit Edison Company
Detroit, Michigan
We have made a review, in accordance with standards established by the American
Institute of Certified Public Accountants, of the unaudited interim financial
information of DTE Energy Company and subsidiaries and of The Detroit Edison
Company and subsidiaries for the periods ended March 31, 1999 and 1998, as
indicated in our report dated April 28, 1999. Because we did not perform an
audit, we expressed no opinion on that information.
We are aware that our report referred to above, which is included in your
Quarterly Report on Form 10-Q for the quarter ended March 31, 1999, is
incorporated by reference in the following Registration Statements:
FORM REGISTRATION NUMBER
DTE Energy Company
Form S-3 33-57545
Form S-8 333-00023
The Detroit Edison Company.
Form S-3 33-53207
Form S-3 33-64296
Form S-3 333-65765
We also are aware that the aforementioned report, pursuant to Rule 436(c) under
the Securities Act of 1933, is not considered a part of the Registration
Statement prepared or certified by an accountant or a report prepared or
certified by an accountant within the meaning of Sections 7 and 11 of that Act.
DELOITTE & TOUCHE LLP
Detroit, Michigan
April 28, 1999
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
The Schedule contains summary financial information extracted from
the Condensed Consolidated Statement of Income, Balance Sheet,
Statement of Cash Flows, Statement of Changes in Shareholders'
Equity and Basic and Diluted Earnings per Share of Common Stock
and is qualified in its entirety by reference to such financial statements.
</LEGEND>
<CIK> 0000936340
<NAME> DTE ENERGY COMPANY
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> MAR-31-1999
<CASH> 173
<SECURITIES> 0
<RECEIVABLES> 602
<ALLOWANCES> 20
<INVENTORY> 313
<CURRENT-ASSETS> 1,204
<PP&E> 12,325
<DEPRECIATION> 5,336
<TOTAL-ASSETS> 12,053
<CURRENT-LIABILITIES> 1,524
<BONDS> 3,984
0
0
<COMMON> 1,950
<OTHER-SE> 1,786
<TOTAL-LIABILITY-AND-EQUITY> 12,053
<SALES> 0
<TOTAL-REVENUES> 1,024
<CGS> 0
<TOTAL-COSTS> 809
<OTHER-EXPENSES> 3
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 83
<INCOME-PRETAX> 129
<INCOME-TAX> 14
<INCOME-CONTINUING> 115
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 115
<EPS-PRIMARY> 0.79
<EPS-DILUTED> 0.79
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
The Schedule contains summary financial information extracted from
the Condensed Consolidated Statement of Income, Balance Sheet,
Statement of Cash Flows and Statement of Changes in Shareholders'
Equity and is qualified in its entirety by reference to such financial
statements.
</LEGEND>
<CIK> 0000028385
<NAME> THE DETROIT EDISON COMPANY
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> MAR-31-1999
<CASH> 3
<SECURITIES> 0
<RECEIVABLES> 538
<ALLOWANCES> 20
<INVENTORY> 300
<CURRENT-ASSETS> 936
<PP&E> 11,739
<DEPRECIATION> 5,293
<TOTAL-ASSETS> 10,985
<CURRENT-LIABILITIES> 1,385
<BONDS> 3,268
0
0
<COMMON> 1,951
<OTHER-SE> 1,586
<TOTAL-LIABILITY-AND-EQUITY> 10,985
<SALES> 0
<TOTAL-REVENUES> 911
<CGS> 0
<TOTAL-COSTS> 687
<OTHER-EXPENSES> 3
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 68
<INCOME-PRETAX> 153
<INCOME-TAX> 49
<INCOME-CONTINUING> 104
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 104
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
