Filed Pursuant to Rule 424(b)(5)
Registration No. 33-63602
PROSPECTUS SUPPLEMENT TO PROSPECTUS DATED JUNE 15, 1993
$100,000,000
[LOGO] DUQUESNE LIGHT COMPANY
7 3/8% Quarterly Interest Bonds Due 2038
Interest payable February 1, May 1, August 1
and November 1 Due April 15, 2038
------------
The 7 3/8% Quarterly Interest Bonds Due 2038 (the "Offered Bonds"),
are part of the series of debt securities of Duquesne Light Company
designated "First Collateral Trust Bonds, Series E" and described
in the accompanying Prospectus. The Offered Bonds will mature
on April 15, 2038. The Offered Bonds will bear interest
from the date of original issuance, and interest on the
Offered Bonds will be payable quarterly in arrears on
February 1, May 1, August 1 and November 1 of each
year commencing August 1, 1998. The Offered Bonds
will not be redeemable prior to May 1, 2003. On
and after that date, the Offered Bonds may be
redeemed in whole at any time, or in part
from time to time, at the option of the
Company at a redemption price equal to
100% of the principal amount thereof,
plus accrued interest to the
redemption date. The Offered
Bonds will be issued in
denominations of $25
and any integral
multiple thereof.
The Offered Bonds will be represented by one or more Global Bonds registered
in the name of a nominee of The Depository Trust Company, as Depositary.
Beneficial interests in Global Bonds representing Book-Entry Bonds will
be shown on, and transfer thereof will be effected only through,
records maintained by the Depositary and its participants. The
Offered Bonds will not be represented by certificates issued in
definitive form, except under the limited circumstances
described herein. See "Supplemental Description of
the Offered Bonds--Book-Entry Bonds." The Offered
Bonds have been approved for listing on the New
York Stock Exchange, subject to official
notice of issuance. Trading of the
Offered Bonds on the New York Stock
Exchange is expected to commence
within a 30-day period after the
initial delivery of the Offered
Bonds. See "Underwriting"
herein.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS SUPPLEMENT OR THE PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
Underwriting
Price to Discounts and Proceeds to
Public(1) Commissions(2) Company(1)(2)(3)
--------- -------------- ----------------
Per Offered Bond . . 100% 3.15% 96.85%
Total . . . . . . . . $100,000,000 $3,150,000 $96,850,000
(1) Plus accrued interest, if any, from date of issuance.
(2) The underwriting discount will be 2% of the principal amount of
Offered Bonds sold to certain institutions. Therefore, to the
extent any such sales are made to such institutions, the actual
total underwriting discount will be less than, and the actual
total proceeds to the Company will be greater than, the amounts
shown in the table above.
(3) Before deduction of expenses payable by the Company estimated at
$325,000.
The Offered Bonds are offered by the several Underwriters when, as and
if issued by the Company, delivered to and accepted by the Underwriters and
subject to their right to reject orders in whole or in part. It is
expected that delivery of the Offered Bonds will be made in book-entry form
through the facilities of The Depository Trust Company on or about April
29, 1998, against payment in immediately available funds.
CREDIT SUISSE FIRST BOSTON SALOMON SMITH BARNEY
GOLDMAN, SACHS & CO. MERRILL LYNCH & CO.
Prospectus Supplement dated April 24, 1998.
<PAGE>
CERTAIN PERSONS PARTICIPATING IN THIS OFFERING MAY ENGAGE IN
TRANSACTIONS THAT STABILIZE, MAINTAIN OR OTHERWISE AFFECT THE
PRICE OF THE SECURITIES OFFERED HEREBY, INCLUDING OVER-ALLOTMENT,
STABILIZING TRANSACTIONS, SYNDICATE SHORT COVERING TRANSACTIONS
AND PENALTY BIDS. FOR A DESCRIPTION OF THESE ACTIVITIES, SEE
"UNDERWRITING."
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<PAGE>
SUMMARY OF OFFERING
The following summary is qualified in its entirety by
reference to the detailed information appearing elsewhere in this
Prospectus Supplement and in the accompanying Prospectus.
Capitalized terms not otherwise defined shall have the meanings
assigned in the accompanying Prospectus.
The Company . . . . . . . . The Company was formed under
the laws of Pennsylvania by
the consolidation and merger
in 1912 of three constituent
companies. As part of a
corporate reorganization, the
Company became a wholly-owned
subsidiary of DQE, an energy
services holding company
formed in 1989. The Company
is engaged in the generation,
transmission, distribution and
sale of electric energy,
providing electric service to
customers in Allegheny County,
including the City of
Pittsburgh, Beaver County and
Westmoreland County. This
territory represents
approximately 800 square miles
in southwestern Pennsylvania,
located within a 500-mile
radius of one-half of the
population of the United
States and Canada. The
population of the area served
by the Company's electric
utility operations, based on
1990 census data, is
approximately 1,510,000, of
whom 370,000 reside in the
City of Pittsburgh. In
addition to serving
approximately 580,000 direct
customers, the Company's
utility operations also sell
electricity to other
utilities.
Offered Bonds . . . . . . . The Company is offering
$100,000,000 aggregate
principal amount of the
Offered Bonds. Interest on
the Offered Bonds will be
payable quarterly in arrears
on February 1, May 1, August 1
and November 1 of each year,
commencing August 1, 1998.
Record Date . . . . . . . . The regular record date for
each Interest Payment Date
will be the January 15, April
15, July 15 or October 15, as
the case may be, next
preceding such Interest
Payment Date.
Security . . . . . . . . . The Offered Bonds will be
issued as a tranche of
securities under the Company's
Mortgage. The Mortgage
constitutes a first mortgage
lien on all of the property of
the Company subject thereto,
subject to certain Permitted
Liens. See "Supplemental
Description of the Offered
Bonds--Security; Discharge of
the 1947 Mortgage" herein, and
"Security" in the accompanying
Prospectus.
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<PAGE>
Redemption . . . . . . . . The Offered Bonds may be
redeemed at the option of the
Company in whole at any time
or in part from time to time,
on or after May 1, 2003, at a
redemption price of 100% of
the principal amount plus
accrued interest to the
redemption date. See
"Supplemental Description of
the Offered Bonds - Optional
Redemption" herein.
Listing . . . . . . . . . . The New York Stock Exchange
NYSE Symbol . . . . . . . . DQZ
CAPITALIZATION
The following table sets forth the consolidated capitalization of
the Company as of December 31, 1997, and as adjusted to give effect to
the issuance of the Offered Bonds and certain other transactions. The
table should be read in conjunction with the consolidated financial
statements of the Company and the notes thereto appearing in the
Incorporated Documents.
Capitalization as of
December 31, 1997
---------------------------
Actual As Adjusted (1)
------------ --------------
(Thousands, except
percentages)
Common Stockholders' Equity $1,003,833 $1,003,833
Preferred Stock 64,608 64,608
Monthly Income Preferred Securities 150,000 150,000
Preference Stock, net of deferred ESOP
benefit of $16,400 11,895 11,895
7 3/8% Quarterly Interest Bonds due 2038 -- 100,000
First Mortgage Bonds 778,000 718,000
Pollution Control Notes 417,985 417,985
Other Long-Term Debt 22,291 22,291
---------- ----------
Total Capitalization, excluding
amounts due within one year $2,448,612 $2,488,612
========== ==========
Capitalization as of
December 31, 1997
-------------------
%
--------
(Thousands, except
percentages)
Common Stockholders' Equity 40.3%
Preferred Stock 2.6%
Monthly Income Preferred Securities 6.0%
Preference Stock, net of deferred ESOP
benefit of $16,400 0.5%
7 3/8% Quarterly Interest Bonds due 2038 4.0%
First Mortgage Bonds 28.9%
Pollution Control Notes 16.8%
Other Long-Term Debt 0.9%
------
Total Capitalization, excluding amounts
due within one year 100.0%
======
(1) Reflects the following adjustments: (i) the February 1998 issuance of
$40 million aggregate principal amount of 6.45% first mortgage bonds,
due February 2008; (ii) the March 1998 redemption of $100 million
aggregate principal amount of 8.75% first mortgage bonds due May 2022
at a redemption price of 106.5625%; and (iii) the issuance of the
Offered Bonds.
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<PAGE>
RECENT DEVELOPMENTS
RECOMMENDED DECISIONS ON THE PROPOSED MERGER AND THE RESTRUCTURING PLANS
On March 25, 1998, two Pennsylvania Public Utility Commission ("PUC")
administrative law judges recommended that a decision on the proposed
merger of the Company's parent, DQE, Inc. and Allegheny Energy, Inc.
("AYE") be deferred for up to 18 months to allow the companies to address
market power concerns. If the PUC follows this recommendation, the
proposed merger, originally anticipated to be consummated in mid-1998, may
not occur. In two other decisions issued at the same time, the judges
recommended approval, with modifications, of the restructuring plans of the
Company and of AYE's utility subsidiary, West Penn Power. On April 14,
1998, the Company filed exceptions to the recommendations regarding the
Company's restructuring plan. Also on April 14, DQE and AYE jointly filed
exceptions to the PUC administrative law judges' recommendation that
approval of the proposed merger be delayed by up to 18 months until market
power concerns have been addressed.
In its restructuring plan filed in August 1997, the Company proposed a
market-based approach to determining the value of its generating assets,
with a final market test to be applied in 2003, when electricity markets
are more fully developed. The administrative law judge did not support
this approach, citing the delay until 2003 as inappropriate, and
recommended instead either an immediate auction of the Company's generating
assets if the proposed DQE/AYE merger is not consummated, or an
administrative determination of the value of such assets if the proposed
DQE/AYE merger is consummated. In its exceptions, the Company is seeking
clarification of the administrative law judge's recommendation. Also in
its exceptions, the Company reaffirms its fundamental premise that market
data should be used to set the value of its generating assets.
In their joint exceptions, DQE and AYE commit to mitigate the
potential market power of the new company by joining the Midwest
Independent System Operator (MISO), a regional electricity transmission
organization, and by relinquishing control of the output of the Company's
570-megawatt Cheswick Power Station (Cheswick) for a minimum of two years
or until the MISO has been approved. Both actions would occur immediately
upon completion of the proposed merger. DQE and AYE further commit to
issue a request for proposals to sell the output of Cheswick within a month
of securing all required regulatory approvals for the proposed merger. The
Company will continue to own and operate Cheswick. Both DQE and AYE are
urging the PUC to adopt the plan for a final valuation of generating assets
in 2003.
The PUC is currently scheduled to consider all exceptions to the
recommended decisions at its April 30, 1998 meeting. A final vote is
currently scheduled for May 21, 1998. Further details about exceptions and
the recommended decisions are provided in the Company's reports on Form 8-
K, filed with the SEC on April 8 and April 17, 1998.
BEAVER VALLEY POWER STATION
Beaver Valley Unit 1 ("BV Unit 1") went off-line January 30, 1998, due
to an issue identified in a technical review recently completed by the
Company. Beaver Valley Unit 2 ("BV Unit 2") went off-line December 16,
1997, to repair the emergency air supply system to the control room and has
remained off-line due to other issues identified by a similar technical
review of BV Unit 2. These technical reviews are in response to a 1997
commitment made by the Company to the Nuclear Regulatory Commission
("NRC"). The Company is one of many utilities faced with similar issues,
some of which date back to the initial start-up of Beaver Valley Power
Station. Both units remain off-line for a reaffirmation of compliance with
the technical specification requirements of various plant systems. The
Company is preparing for a meeting with the NRC, currently expected to take
place in May 1998, to review its action plans and discuss any needed
remediation. Both units will remain off-line until the action plans have
been satisfactorily completed. Further details are provided in the
Company's Annual Report on Form 10-K for the year ended December 31, 1997.
S-5
<PAGE>
RATIO OF EARNINGS TO FIXED CHARGES
Year Ended December 31,
-----------------------------------------------
1997 1996 1995 1994 1993
---- ---- ---- ---- ----
2.49 2.64 2.71 2.58 2.42
Duquesne's share of the fixed charges of an unaffiliated coal supplier,
which amounted to approximately $2.7 million for the twelve months ended
December 31, 1997, has been excluded from the ratio. Earnings related to
income taxes reflect a $17.0 million, $12.0 million, $13.5 million, $13.5
million and $10.4 million decrease for the twelve months ended December 31,
1997, 1996, 1995, 1994 and 1993, respectively, due to a financial statement
reclassification related to Statement of Financial Accounting Standards No.
109, Accounting for Income Taxes. The ratio of earnings to fixed charges,
absent this reclassification equals 2.61, 2.72, 2.81, 2.67 and 2.48 for the
twelve months ended December 31, 1997, 1996, 1995, 1994 and 1993,
respectively.
USE OF PROCEEDS
The Company currently intends to use the net proceeds from the sale of
Offered Bonds for general corporate purposes, including the possible
redemption of higher cost securities of the Company.
SUPPLEMENTAL DESCRIPTION OF THE OFFERED BONDS
The following description of the particular terms of the Offered Bonds
of Duquesne Light Company (the "Company") supplements, and to the extent
inconsistent therewith supersedes, the description of the general terms and
provisions of the Bonds set forth under "Description of the Bonds" in the
accompanying Prospectus, to which description reference is hereby made.
Certain capitalized terms used herein are defined under "Description of the
Bonds" in the accompanying Prospectus.
GENERAL
The Offered Bonds will be issued as a tranche of a series of Mortgage
Securities under the Mortgage limited in aggregate principal amount to
$300,000,000; such tranche will be limited in aggregate principal amount to
$100,000,000.
The Offered Bonds will be issued in fully registered form only,
without coupons. The Offered Bonds will be issued initially as Book-Entry
Bonds (as hereinafter defined) and, except as set forth herein under "Book-
Entry Bonds," will not be exchangeable for, or otherwise issuable as,
Certificated Bonds (as hereinafter defined). The authorized denominations
of the Offered Bonds will be $25 and any integral multiple thereof.
DISCHARGE OF 1947 MORTGAGE
On August 30, 1995 all Class "A" Bonds issued under the Company's 1947
Mortgage were surrendered for cancellation and the 1947 Mortgage was
discharged. As of such date the only bonds that had been outstanding under
the 1947 Mortgage were Class "A" Bonds held by the Trustee as the basis of
authentication and delivery of Mortgage Securities, and no other Class "A"
Mortgage existed. As a result of the discharge of the 1947 Mortgage, the
lien of the 1947 Mortgage on the Company's property ceased to exist and the
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<PAGE>
Mortgage became a first mortgage lien on all property of the Company
subject thereto, subject to certain Permitted Liens as described under
"Description of the Bonds--Security" in the accompanying Prospectus. The
information set forth in the accompanying Prospectus under the headings
"Description of the Bonds--Security" and "Description of the 1947
Mortgage" is accordingly hereby superseded as a result of the discharge of
the 1947 Mortgage. The Offered Bonds will be issued on the basis of
Property Additions as described under "Description of the Bonds--
Issuance of Additional Mortgage Securities" in the accompanying Prospectus.
PAYMENT AND MATURITY
The Offered Bonds will mature on April 15, 2038 (the "Stated
Maturity") and will bear interest at a rate of 7 percent per annum until
the principal amount thereof is paid or made available for payment. The
Offered Bonds will bear interest from the date of original issuance.
Interest on each Offered Bond will be payable quarterly in arrears on each
February 1, May 1, August 1 and November 1 of each year (each such date an
"Interest Payment Date"), commencing August 1, 1998, and at Maturity. Each
payment of interest in respect of an Interest Payment Date will include
interest accrued to but excluding such Interest Payment Date. Interest on
the Offered Bonds will be computed on the basis of a 360-day year of twelve
30-day months.
Payments of interest on the Offered Bonds (other than interest payable
at Maturity) will be made by check mailed to the Holders of such Offered
Bonds as of the Regular Record Date for each Interest Payment Date;
provided, however, that (a) in the case of Global Bonds representing Book-
Entry Bonds (the holder of which will be a nominee of the Depositary, as
hereinafter defined), such payment will be made in accordance with
arrangements then in effect among the Company, the Paying Agent and the
Depositary (see "Book-Entry Bonds"); and (b) if and to the extent the
Company defaults in the payment of the interest due on any Offered Bond on
any Interest Payment Date, such defaulted interest will be paid as
described under "Description of the Bonds--Payment of Bonds; Transfers;
Exchanges" in the accompanying Prospectus. The "Regular Record Date" with
respect to any Interest Payment Date will be the January 15, April 15, July
15 or October 15 (whether or not a "Business Day" as defined below), as the
case may be, immediately preceding such Interest Payment Date.
Except as described below under "Book-Entry Bonds" and under
"Description of the Bonds--Payment of Bonds; Transfers; Exchanges" in the
accompanying Prospectus, principal of the Offered Bonds and any premium and
interest thereon payable at Maturity will be paid upon surrender thereof at
the office of The First National Bank of Chicago in New York, New York.
If, with respect to any Offered Bond, any Interest Payment Date,
redemption date or Stated Maturity is not a Business Day, payment of
amounts due on such Offered Bond on such date may be made on the next
succeeding Business Day and, if such payment is made or duly provided for
on such Business Day, no interest shall accrue on such amounts for the
period from and after such Interest Payment Date, redemption date or Stated
Maturity, as the case may be, to such Business Day.
"Business Day" with respect to any Offered Bond means any day, other
than a Saturday or Sunday, which is not a day on which banking institutions
or trust companies in The City of New York, New York or the city in which
is located any office or agency maintained for the payment of principal of
or premium, if any, or interest on such Offered Bond are authorized or
required by law, regulation or executive order to remain closed.
S-7
<PAGE>
CERTAIN TRADING CHARACTERISTICS
The Company has been advised by The New York Stock Exchange that the
Offered Bonds are expected to trade at a price that takes into account the
value, if any, of accrued but unpaid interest (except for interest accrued
after a Regular Record Date and prior to an Interest Payment Date, which
interest will be payable to the Holders as of such Regular Record Date, as
described above); thus, purchasers will not pay, and sellers will not
receive, accrued and unpaid interest with respect to the Offered Bonds that
is not included in the trading price thereof. Any portion of the trading
price of an Offered Bond received by a seller that is attributable to
accrued interest will be treated as ordinary interest income for federal
income tax purposes and will not be treated as part of the amount realized
for purposes of determining gain or loss on the disposition of the Offered
Bond.
OPTIONAL REDEMPTION
The Company will have the right to redeem Offered Bonds, in whole at
any time or in part from time to time, on or after May 1, 2003, upon not
less than 30 nor more than 60 days' notice, at a redemption price equal to
100% of the principal amount to be so redeemed plus any accrued and unpaid
interest to the redemption date.
Additional information concerning redemption is contained under
"Description of the Bonds--Redemption" in the accompanying Prospectus.
MODIFICATION OF MORTGAGE
Reference is made to "Modification of Mortgage" in the accompanying
Prospectus.
The Holders of the Offered Bonds will be deemed to have consented to
the execution and delivery of a supplemental indenture containing one or
more, or all, of the amendments to the Mortgage described below:
(a) to change the definition of the term "Stated Interest Rate"
to provide, among other things, that any calculation or other
determination to be made under the Mortgage by reference to the Stated
Interest Rate on an obligation which secures other indebtedness will
be made by reference to the lower of the Stated Interest Rate on such
obligation and the Stated Interest Rate on such other indebtedness;
(b) to change the definition of the term "Cost" to, among other
things, clarify that such term includes, in addition to the amount of
cash paid, the fair market value of property delivered and the
principal amount of indebtedness assumed, and any other amounts which,
in accordance with generally accepted accounting principles, are
properly chargeable to plant or other property accounts; and/or
(c) to add a definition of the term "fair value", providing,
among other things, that "fair value" with respect to any property
will be determined by reference to (a) the amount which would be
likely to be obtained in an arm's length transaction with respect to
such property between an informed and willing buyer and an informed
and willing seller, under no compulsion, respectively, to buy or sell,
(b) the amount of investment with respect to such property which,
together with a reasonable return thereon, would be likely to be
recovered through ordinary business operations or otherwise, (c) the
cost, accumulated depreciation and replacement cost with respect to
such property and (d) any other relevant factors.
S-8
<PAGE>
As more fully described under "Description of the Bonds--Release of
Property" in the accompanying Prospectus, obligations secured by purchase
money mortgage on any property to be released from the lien of the Mortgage
may be deposited with the Trustee or the trustee or other holder of a lien
prior to the lien of the Mortgage, and the release of such property may be
made on the basis of the principal amount of such obligations so deposited.
The use of obligations secured by purchase money mortgage on property to be
released as the basis of such release, as described above, is subject to
the following limitations: (x) no obligations secured by purchase money
mortgage may be so used unless all obligations secured by such purchase
money mortgage shall be delivered to the Trustee or the trustee or other
holder of a prior lien; (y) the aggregate credit which may be used as
described above in respect of any property being released may not exceed
75% of the fair value of such property; and (z) no such obligations may be
so used as a credit in connection with the release of property if the
aggregate credit in respect of such obligations to be used as described
above plus the aggregate credits used by the Company in connection with all
previous releases of property on the basis of purchase money obligations
theretofore delivered to and then held by the Trustee or the trustee or
other holder of a prior lien shall, immediately after the release then
being applied for, exceed 15% of the aggregate principal amount of Mortgage
Securities then Outstanding.
The Holders of the Offered Bonds will be deemed to have consented to
the execution and delivery of a supplemental indenture containing, in
addition to the amendments to the Mortgage described above, one or both of
the amendments described below:
(x) to modify the provisions described in the preceding
paragraph to (i) delete the provisions described in clause (x) or to
provide that such provisions may be disregarded upon specified
conditions; and/or (ii)(A) to delete the provisions described in
clause (z) or to provide that clause (z) may be disregarded upon
specified conditions; or (B) to delete from the provisions described
in clause (z) the limitation of 15%; or (C) to change the percentage
in clause (z) to any higher percentage not exceeding 100%; and/or
(y) to add a definition of the term "purchase money mortgage" to
mean, generally, a lien on the property being acquired or disposed of
by the Company or being released from the lien of the Mortgage which
is retained by the transferor of such property or granted to one or
more persons in connection with the transfer or release thereof, or
granted to or held by a trustee or agent for any such persons, and
which would include, among other things, liens which (i) permit the
incurrence of indebtedness secured thereby in addition to indebtedness
incurred in connection with the transfer of specific property, (ii)
permit the subjection of other property to the lien thereof and/or
(iii) were granted prior to any particular transfer of property, which
cover other property and/or which secure other obligations issued
prior or subsequent to the obligations delivered in connection with
any particular acquisition, disposition or release of property.
The Officer's Certificate which establishes certain terms of the
Offered Bonds provides that the possible modifications to the Mortgage
described above will be substantially of the tenor or effect of the forms
thereof set forth in such Officer's Certificate. A form of such Officer's
Certificate, as well as the Officer's Certificate which established the
series of Mortgage Securities designated First Collateral Trust Bonds,
Series E, are on file with the Trustee and have been filed with the SEC as
an exhibit to the Registration Statement (Registration No. 33-63602)
relating to the First Collateral Trust Bonds, Series E.
THE TRUSTEE
On November 24, 1997, The Chase Manhattan Bank succeeded Mellon Bank,
N.A. as Trustee under the Mortgage.
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<PAGE>
BOOK-ENTRY BONDS
The Offered Bonds will be represented by global bonds (each, a "Global
Bond") that will be deposited with, or on behalf of, The Depository Trust
Company, New York, New York ("DTC"), or such other depositary as may be
subsequently designated (DTC and any other such depositary being
hereinafter referred to as the "Depositary"), and registered in the name of
the Depositary, or its nominee (such an Offered Bond, so represented, being
called a "Book-Entry Bond"). Except under the limited circumstances
described below, Book-Entry Bonds represented by Global Bonds will not be
exchangeable for certificates issued in definitive form (any such Offered
Bond, so represented, being called a "Certificated Bond"), and will not
otherwise be issuable as Certificated Bonds.
DTC is a limited-purpose trust company organized under the New York
Banking Law, a "banking organization" within the meaning of the New York
Banking Law, a member of the Federal Reserve System, a "clearing
corporation" within the meaning of the New York Uniform Commercial Code,
and a "clearing agency" registered pursuant to the provisions of Section
17A of the Exchange Act. DTC was created to hold securities that are
deposited by institutions having accounts with it ("participants"), and to
facilitate the clearance and settlement of securities transactions, such as
transfers and pledges, among its participants in such deposited securities
through electronic computerized book-entry changes in accounts of the
participants, thereby eliminating the need for physical movement of
securities certificates. DTC's participants include securities brokers and
dealers (including the Underwriters), banks, trust companies, clearing
corporations, and certain other organizations, some of whom (and/or their
representatives) own DTC. Access to DTC's book-entry system is also
available to others, such as securities brokers and dealers, banks and
trust companies that clear through or maintain a custodial relationship
with a participant, either directly or indirectly. The rules applicable to
DTC and its participants are on file with the SEC.
Purchases of beneficial interests in a Global Bond must be made by or
through the Depositary's participants. Upon the issuance of a Global Bond,
the Depositary will credit, on its book-entry registration and transfer
system, the respective principal amounts of the individual Book-Entry Bonds
represented by such Global Bond to the accounts of its participants. The
accounts to be credited will initially be designated by the Underwriters or
the Company. Ownership of beneficial interests in a Global Bond will be
shown on, and the transfer of that ownership will be effected only through,
records maintained by the Depositary (with respect to participants'
interests) or by participants or persons that hold through participants
(with respect to person other than participants). The laws of some states
require that certain purchasers of securities take physical delivery of
such securities. Such limits and such laws may impair the ability to
transfer beneficial interests in a Global Bond.
Payments of principal of and premium, if any, and interest on
individual Book-Entry Bonds represented by a Global Bond will be made to
the Depositary or its nominee, as the case may be, as the Holder of such
Global Bond. The Depositary or its nominee, upon receipt of any payment of
principal, premium or interest in respect of a definitive Global Bond, will
credit the accounts of the related participants with payments in amounts
proportionate to their respective beneficial interests in the principal
amount of such Global Bond as shown on the records of the Depositary.
Payments by participants to owners of beneficial interests in such Global
Bond held through such participants will be governed by standing
instructions and customary practices, as is now the case with securities
held for the accounts of customers in bearer form or registered in "street
name", and will be the responsibility of such participants and not of the
Depositary, the Company or any Paying Agent, subject to any statutory or
regulatory requirements as may be in effect from time to time. Payments to
the Depositary are the responsibility of the Company or any Paying Agent,
disbursement of such payments to the Depositary's participants shall be the
responsibility of the Depositary, and disbursement of such payments to the
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<PAGE>
owners of beneficial interests in Global Bonds shall be the responsibility
of the Depositary's participants and persons who hold through such
participants.
So long as the Depositary, or its nominee, is the registered owner of
a Global Bond, such Depositary or such nominee, as the case may be, will be
considered the sole holder of the individual Book-Entry Bonds represented
by such Global Bond for all purposes under the Mortgage. Except as set
forth below, owners of beneficial interests in a Global Bond will not be
entitled to have any of the individual Book-Entry Bonds represented by such
Global Bond registered in their names, will not receive or be entitled to
receive physical delivery of any such Book-Entry Bonds and will not be
considered the Holders thereof under the Mortgage, including, without
limitation, for purposes of consenting to any amendment thereof or
supplement thereto as described in the accompanying Prospectus. Neither
DTC nor any nominee will consent or vote with respect to the Book-Entry
Bonds. Under its usual procedures, DTC will mail an omnibus proxy to the
Company as soon as possible after the appropriate record date. Such
omnibus proxy assigns the rights of DTC or its nominee to vote or consent
to those participants to whose accounts the Book-Entry Bonds are credited
on such record date, identified in a listing attached to such omnibus
proxy.
If the Depositary is at any time unwilling or unable to continue as
depositary and a successor depositary is not appointed, the Company will
issue individual Certificated Bonds in exchange for the Global Bond or
Bonds representing the corresponding Book-Entry Bonds. In addition, the
Company may at any time and in its sole discretion determine not to have
any Bonds represented by one or more Global Bonds, and in such event, will
issue individual Certificated Bonds in exchange for the Global Bond or
Bonds representing the corresponding Book-Entry Bonds. In any such
instance, an owner of a Book-Entry Bond represented by a Global Bond or
Bonds will be entitled to physical delivery of individual Certificated
Bonds equal in principal amount to such Book-Entry Bond and to have such
Certificated Bonds registered in its name. Individual Certificated Bonds
so issued will be issued as registered Offered Bonds in denominations of
$25 and integral multiples thereof.
The information in this section concerning the DTC and DTC's book-
entry system is based upon information furnished by DTC, and the Company
takes no responsibility for the accuracy thereof.
None of the Company, the Trustee or any agent for payment on or
registration of transfer or exchange of such Offered Bonds will have any
responsibility or liability for any aspect of the records relating to or
payments made on account of beneficial interests in such Global Bonds or
for maintaining, supervising or reviewing any records relating to such
beneficial interests.
LEGAL OPINIONS
Legal matters in connection with the Offered Bonds will be passed upon
for the Company by David R. High, Esq., employed by the Company as its
Assistant General Counsel, and by Reid & Priest LLP, special counsel for
the Company, and for the Underwriters by Milbank, Tweed, Hadley & McCloy.
All legal matters pertaining to title and the lien of the Mortgage will be
passed upon only by Mr. High.
S-11
<PAGE>
UNDERWRITING
Under the terms and subject to the conditions contained in the Selling
Agency Agreement, dated June 15, 1993, as supplemented by the Terms
Agreement, dated the date hereof (the "Underwriting Agreement"), the
Underwriters named below (the "Underwriters"), for whom Credit Suisse First
Boston Corporation, Smith Barney, Inc., Goldman, Sachs & Co. and Merrill
Lynch, Pierce, Fenner & Smith Incorporated are acting as representatives
(the "Representatives"), have severally but not jointly agreed to purchase
from the Company the following respective principal amounts of Offered
Bonds:
Principal
Amount
Underwriters Offered Bonds
------------ --------------
Credit Suisse First Boston Corporation $ 21,737,500
Smith Barney, Inc. . . . . . . . . . . 21,737,500
Goldman, Sachs & Co. . . . . . . . . . 21,700,000
Merrill Lynch, Pierce, Fenner & Smith
Incorporated . . . . . . . . . 21,700,000
BT Alex. Brown Incorporated . . . . . . 875,000
BNY Capital Markets Incorporated - NJ . 875,000
Dain Rauscher Incorporated . . . . . . 875,000
A.G. Edwards & Sons, Inc. . . . . . . . 875,000
EVEREN Securities, Inc. . . . . . . . . 875,000
Janney Montgomery Scott Inc. . . . . . 875,000
Edward D. Jones & Co., L.P. . . . . . . 875,000
Legg Mason Wood Walker, Incorporated. . 875,000
McDonald & Company Securities, Inc. . . 875,000
Parker/Hunter Incorporated . . . . . . 875,000
Prudential Securities Incorporated . . 875,000
Pryor, McClendon, Counts & Co., Inc.. . 875,000
The Robinson-Humphrey Company, LLC. . . 875,000
SBC Warburg Dillon Read Inc. . . . . . 875,000
Wheat First Securities, Inc. . . . . . 875,000
------------
Total . . . . . . . . . . . . . . $100,000,000
============
The Underwriting Agreement provides that the obligations of the
Underwriters are subject to certain conditions precedent, and the
Underwriters will be obligated to purchase all of the Offered Bonds if any
are purchased.
The Company and the Underwriters have agreed that the underwriting
discount will be 3.15% per offered Bond, except that the underwriting
discount will be 2% per Offered Bond for bonds sold to certain
institutions. The Company has been advised by the Representatives that the
Underwriters propose to offer the Offered Bonds to the public initially at
the public offering price set forth on the cover page of this Prospectus
Supplement, and to certain dealers at such price less a concession of 2% of
the principal amount of such Offered Bonds, and the Underwriters and such
dealers may allow a discount of 1.4% of the principal amount of such
Offered Bonds on sales to certain other dealers. After the initial public
offering, the offering price and concession and discount to dealers may be
changed by the Representatives.
S-12
<PAGE>
The Company has agreed, during the period of 15 days from the date of
the Underwriting Agreement, not to issue or announce the proposed issuance
of any of its secured debt securities with maturities or other terms
substantially similar to the Offered Bonds (other than borrowings under
revolving credit agreements and lines of credit and issuances of commercial
paper), without the prior written consent of the Representatives.
The Offered Bonds are a new issue of securities with no established
trading market. The Offered Bonds have been approved for listing on the
New York Stock Exchange ("NYSE"), subject to official notice of issuance.
Trading of the Offered Bonds on the NYSE is expected to commence within a
30-day period after the initial delivery of the Offered Bonds. In order to
meet one of the requirements for listing the Offered Bonds on the NYSE, the
Underwriters have undertaken to sell the Offered Bonds to a minimum of 400
beneficial holders. The Company has been advised by the Underwriters that
they intend to make a market in the Offered Bonds, but the Underwriters are
not obligated to do so and may discontinue any market-making at any time
without notice. No assurance can be given as to the liquidity of the
trading market for the Offered Bonds.
The Company has agreed to indemnify the Underwriters against certain
liabilities, including civil liabilities under the Securities Act, or
contribute to payments which the Underwriters may be required to make in
respect thereof.
The Representatives, on behalf of the Underwriters, may engage in
over-allotment, stabilizing transactions, syndicate covering transactions
and penalty bids. Over-allotment involves syndicate sales in excess of the
offering size, which creates a syndicate short position. Stabilizing
transactions permit bids to purchase the underlying security so long as the
stabilizing bids do not exceed a specified maximum. Syndicate covering
transactions involve purchases of the Offered Bonds in the open market
after the distribution has been completed in order to cover syndicate short
positions. Penalty bids permit the Representatives to reclaim a selling
concession from a syndicate member when the Offered Bonds originally sold
by such syndicate member are purchased in a syndicate covering transaction
to cover syndicate short positions. Such stabilizing transactions,
syndicate covering transactions and penalty bids may cause the price of the
Offered Bonds to be higher than it would otherwise be in the absence of
such transactions. These transactions may be effected on the NYSE or
otherwise and, if commenced, may be discontinued at any time.
Credit Suisse First Boston Corporation, Salomon Smith Barney Inc.,
Goldman Sachs & Co. and Merrill Lynch, Pierce, Fenner & Smith Incorporated
and certain affiliates thereof engage in transactions with and perform
services for the Company and its affiliates in the ordinary course of
business.
NOTICE TO CANADIAN RESIDENTS
RESALE RESTRICTIONS
The distribution of the Offered Bonds in Canada is being made only on
a private placement basis exempt from the requirement that the Company
prepare and file a prospectus with the securities regulatory authorities in
each province where trades of Offered Bonds are effected. Accordingly, any
resale of the Offered Bonds in Canada must be made in accordance with
applicable securities laws, which will vary depending on the relevant
jurisdiction, and which may require resales to be made in accordance with
available statutory exemptions or pursuant to a discretionary exemption
granted by the applicable Canadian securities regulatory authority.
Purchasers are advised to seek legal advice prior to any resale of the
Offered Bonds.
S-13
<PAGE>
REPRESENTATIONS OF PURCHASERS
Each purchaser of Offered Bonds in Canada who receives a purchase
confirmation will be deemed to represent to the Company and the dealer from
whom such purchase confirmation is received that (i) such purchaser is
entitled under applicable provincial securities laws to purchase such
Offered Bonds without the benefit of a prospectus qualified under such
securities laws, (ii) where required by law, that such purchaser is
purchasing as principal and not as agent, and (iii) such purchaser has
reviewed that text above under "Resale Restrictions."
RIGHTS OF ACTION (ONTARIO PURCHASERS)
The securities being offered are those of a foreign issuer and Ontario
purchasers will not receive the contractual right of action prescribed by
section 32 of the Regulation under the Securities Act (Ontario). As a
result, Ontario purchasers must rely on other remedies that may be
available, including common law rights of action for damages or rescission
or rights of action under the civil liability provisions of the U.S.
federal securities laws.
ENFORCEMENT OF LEGAL RIGHTS
All of the issuer's directors and officers as well as the experts
named herein may be located outside of Canada and, as a result, it may not
be possible for Canadian purchasers to effect service of process within
Canada upon the issuer or such persons. All or a substantial portion of
the assets of the issuer and such persons may be located outside of Canada
and, as a result, it may not be possible to satisfy a judgment against the
issuer or such persons in Canada or to enforce a judgment obtained in
Canadian courts against such issuer or persons outside of Canada.
NOTICE TO BRITISH COLUMBIA RESIDENTS
A purchaser of Offered Bonds to whom the Securities Act (British
Columbia) applies is advised that such purchaser is required to file with
the British Columbia Securities Commission a report within ten days of the
sale of any Offered Bonds acquired by such purchaser pursuant to this
offering. Such report must be in the form attached to British Columbia
Securities Commission Blanket Order BOR #95/17. Only one such report must
be filed in respect of Offered Bonds acquired on the same date and under
the same prospectus exemption.
TAXATION AND ELIGIBILITY FOR INVESTMENT
Canadian purchasers of Offered Bonds should consult their own legal
and tax advisors with respect to the tax consequence of an investment in
the Offered Bonds in their particular circumstances and with respect to the
eligibility of the Offered Bonds for investment by the purchaser under
relevant Canadian legislation.
S-14
<PAGE>
----------------------------------- -----------------------------------
NO DEALER, SALESPERSON OR OTHER
PERSON HAS BEEN AUTHORIZED TO GIVE
ANY INFORMATION OR TO MAKE ANY
REPRESENTATION NOT CONTAINED IN THIS
PROSPECTUS SUPPLEMENT OR THE $100,000,000
PROSPECTUS AND, IF GIVEN OR MADE,
SUCH INFORMATION OR REPRESENTATION
MUST NOT BE RELIED UPON AS HAVING
BEEN AUTHORIZED BY THE COMPANY OR
ANY UNDERWRITER. THIS PROSPECTUS
SUPPLEMENT AND THE PROSPECTUS DO
NOT CONSTITUTE AN OFFER TO SELL OR
A SOLICITATION OF AN OFFER TO BUY
ANY OF THE SECURITIES OFFERED [LOGO]
HEREBY IN ANY JURISDICTION TO ANY
PERSON TO WHOM IT IS UNLAWFUL TO DUQUESNE LIGHT
MAKE SUCH OFFER IN SUCH COMPANY
JURISDICTION. NEITHER THE DELIVERY
OF THIS PROSPECTUS SUPPLEMENT OR THE
PROSPECTUS NOR ANY SALE MADE
HEREUNDER SHALL, UNDER ANY
CIRCUMSTANCES, CREATE ANY
IMPLICATION THAT THE INFORMATION
HEREIN IS CORRECT AS OF ANY TIME
SUBSEQUENT TO THE DATE HEREOF OR
THAT THERE HAS BEEN NO CHANGE IN THE 7 3/8% Quarterly
AFFAIRS OF THE COMPANY SINCE SUCH Interest Bonds
DATE. Due 2038
___________________
TABLE OF CONTENTS
Page
----
PROSPECTUS SUPPLEMENT
Summary of Offering . . . . . . S-3
Capitalization . . . . . . . . S-4
Recent Developments . . . . . . S-5
Ratio of Earnings to Fixed
Charges . . . . . . . . . . . S-6
Use of Proceeds . . . . . . . . S-6 PROSPECTUS SUPPLEMENT
Supplemental Description of the
Offered Bonds . . . . . . . . S-6
Legal Opinions . . . . . . . S-11
Underwriting . . . . . . . . S-12
Notice to Canadian Residents S-13 CREDIT SUISSE FIRST BOSTON
PROSPECTUS
Available Information . . . . . . 2 SALOMON SMITH BARNEY
Incorporation of Certain Documents
by Reference . . . . . . . . . 2
The Company . . . . . . . . . . . 2
Use of Proceeds . . . . . . . . . 3 GOLDMAN, SACHS & CO.
Plan of Distribution . . . . . . 3
Description of the Bonds . . . . 4
Description of the 1947 MERRILL LYNCH & CO.
Mortgage . . . . . . . . . . 17
Experts . . . . . . . . . . . . 24
Legal Opinions . . . . . . . . 24
Pennsylvania Taxes . . . . . . 24
----------------------------------- -----------------------------------
