File No. 70-
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM U-1
APPLICATION OR DECLARATION
UNDER
THE PUBLIC UTILITY HOLDING COMPANY ACT OF 1935
Allegheny Power System, Inc.
12 East 49th Street
New York, New York 10017
(Name of company or companies filing this statement and
addresses of principal executive offices)
Allegheny Power System, Inc.
(Name of top registered holding company parent of each
applicant or declarant)
Nancy H. Gormley, Esquire
Vice President
Allegheny Power System, Inc.
12 East 49th Street
New York, NY 10017
(Name and address of agent for service)
<PAGE>
Item 1. Description of Proposed Transaction.
Allegheny Power System, Inc. ("APS"), New York, New York, a
registered public utility holding company, files this Application or
Declaration pursuant to Sections 6(a)(2), 7 and 12(e) of the Public Utility
Holding Company Act of 1935 and Rules 62 and 65 thereunder. APS requests
authority through December 31, 1996 to amend its Charter and to make
conforming amendments to its By-laws, where appropriate, which would eliminate
cumulative voting provisions and preemptive rights provisions contained
therein.
A. Preemptive Rights.
Article VII of APS' Charter currently provides that shares of
common stock and securities convertible into common stock may be issued,
without first being offered to shareholders (a) if sold for money in a public
offering or to or through underwriters or investment bankers who agree to make
a public offering thereof; and (b) in payment for property. Under other
circumstances, shareholders are granted preemptive rights.
Elimination of preemptive rights will give the Board of Directors
of APS greater flexibility and reduce the cost of financings, such as the sale
through private placements of new shares of common stock or senior securities
convertible into common stock, where currently APS would be required to first
offer shares to existing shareholders. Under certain conditions, these types
of financings enable companies to fund their capital requirement at a savings
of time, expense and overall cost when compared with other forms of financings.
<PAGE>
For APS, which on January 1, 1995 had 119,292,954 shares of common
stock outstanding and listed on the New York Stock Exchange, preemptive rights
are of little significance for shareholders. While elimination of preemptive
rights will reduce the ability of APS' shareholders to preserve their
proportionate interests in APS' common stock, should they so desire they will
be able to maintain their respective proportionate ownership percentages by
purchasing additional shares on the open market. In addition, by
participating in the APS Dividend Reinvestment and Stock Purchase Plan and
through the optional cash payment provision therein, shareholders may increase
their ownership of APS common stock. Thus, shareholders need not rely on
preemptive rights to protect their proportionate interests and voting rights.
For all of these reasons, APS requests authority to amend its
Charter to eliminate preemptive rights.
B. Cumulative Voting.
Article VII of APS' Charter also currently provides that at the
election of directors, each share of common stock entitles the holder to as
many votes as the number of his or her shares multiplied by the number of
<PAGE>
directors to be elected. The holder may cast his or her votes for a single
director or distribute them among two or more directors as the holder sees
fit.
In order for the APS Board of Directors to work effectively for
all the shareholders, each director should feel a responsibility to the
shareholders as a whole and not to any single group of minority shareholders.
If the proposed amendment is approved by the shareholders, the elimination of
cumulative voting will enable the holders of a majority of the shares entitled
to vote in an election to elect all of the directors. Without the ability to
cumulate their votes, it will be more difficult for a holder of a minority of
outstanding shares to obtain representation on the Board of Directors. Under
certain circumstances, the elimination of cumulative voting may also
discourage a merger, tender offer or proxy contest, the assumption of control
by a holder of a large block of APS' common stock, or the removal of incumbent
management.
For all of these reasons, APS requests authority to amend its
Charter to eliminate cumulative voting.
C. Annual Meeting.
APS proposes to submit to its common shareholders at the annual
meeting of shareholders to be held on or about May 11, 1995, a proposal to
amend APS' Charter to eliminate cumulative voting and preemptive rights. APS
intends to solicit proxies from its shareholders to approve the proposed
Charter amendments. The Charter amendments must be authorized by the vote of
<PAGE>
a two-thirds majority of the holders of the outstanding shares of common stock
entitled to vote at the annual meeting. Attached hereto as Exhibit I are
forms of letters of solicitation proposed to be used and forms of all other
documents proposed to be transmitted with such letters of solicitation.
D. Proxy Solicitation.
APS requests that its declaration with respect to the solicitation
of proxies for voting and expenditures of money and other considerations in
connection therewith be permitted to become effective forthwith as provided in
Rule 62(d). Proxies will be solicited by mail and may be solicited by
officers, directors and regular employees of APS personally, by telephone or
facsimile. APS may reimburse persons holding stock in their names or the
names of their nominees for their expenses in sending solicitating materials
to their principals. The cost of the solicitation and annual meeting is not
expected to exceed $331,500.
Except as described herein, no associate company or affiliate of
APS or any affiliate of any such associate company has any material interest,
directly or indirectly, in the proposed transaction.
Item 2. Fees, Commission and Expenses,
Including Expenses of Annual Meeting of Stockholders
The following estimated fees and expenses are expected to be incurred by
APS in connection with the proposed proxy solicitation and annual meeting:
Filing Fee - SEC '35 Act $ 2,000
Transfer Agent Fee for
Shareholders' Meeting $101,000
Proxy Solicitation $ 7,500
<PAGE>
Printing $ 32,000
Broker Mailings $175,000
Legal Fees $ 5,000
Miscellaneous $ 9,000
TOTAL $331,500
Item 3. Applicable Statutory Provisions
The applicant is informed by counsel that the proposed
transactions, in whole or in part, may be subject to Sections 6(a)(2), 7 and
12(e) of the Public Utility Holding Company Act of 1935 and Rules 62 and 65
thereunder.
Item 4. Regulatory Approval
No commission other than the Securities and Exchange Commission
has jurisdiction over the proposed transactions.
Item 5. Procedure
It is requested that the Commission's order granting this
Application or Declaration be issued as soon as possible given the proposed
timetable with respect to the annual meeting of shareholders. There should be
no recommended decision by a hearing officer or by any other responsible
officer of the Commission and no 30-day waiting period between the issuance of
the Commission's Order and its effective date. The Division of Investment
Management may assist in the preparation of the Commission's decision unless
the Division opposes the matters covered by this Application or Declaration.
<PAGE>
Item 6. Exhibits and Financial Statements
(a) Exhibits:
A-1. Charter of the Company, as amended(1).
A-2. Form of Articles of Amendment.
B. None.
C. None.
D. None.
E. Not applicable.
F. Opinion of counsel.
H. Proposed SEC Notice.
I. Forms of Notice of Annual Meeting, Proxy
Statement and Proxy (to be filed by
Amendment).
(b) Financial Statements
None.
Item 7. Information as to Environmental Effects.
(a) For the reasons set forth in Item 1, the authorization
applied for herein does not require major federal
action significantly affecting the quality of the
human environment for purposes of Section 102(2)(C) of
the National Environmental Policy Act (42 U.S.C.
4232(2)(C)).
(b) Not applicable.
(1) Incorporated by reference to Form 10-Q of the Company (1-267), September
1993, exh. (a)(3).
<PAGE>
SIGNATURE
Pursuant to the requirements of the Public Utility Holding Company Act
of 1935, the undersigned company has duly caused this statement to be signed
on its behalf by the undersigned thereunto duly authorized.
Dated: March 3, 1995 ALLEGHENY POWER SYSTEM, INC.
By: KLAUS BERGMAN
Klaus Bergman
Chairman and
Chief Executive Officer
U:\DUMP\CVOTING\U-1
Exhibit A-2
ALLEGHENY POWER SYSTEM, INC.
ARTICLES OF AMENDMENT
Allegheny Power System, Inc. a Maryland corporation having
its principal office in the State of Maryland at Room A, 4604 Old
Swimming Pool Road, P.O. Box 39, Braddock Heights, Frederick
County, Maryland 21714 (hereinafter called the "Corporation"),
hereby certifies to the State Department of Assessments and
Taxation of Maryland that:
FIRST: The charter of the Corporation is hereby amended by
striking out paragraph A of Article VII of the
Restatement of Charter dated August 26, 1964, as most
recently amended by Articles of Amendment dated May 14,
1987, May 12, 1988 and November 4, 1993 (hereinafter
called the "Charter"), and inserting in lieu thereof the
following:
A. The holders of the shares of Common Stock shall
be entitled to one vote for each share of such
stock held by them.
SECOND: The Charter of the Corporation is hereby amended by
striking out paragraph B of Article VII of the Charter
and inserting in lieu thereof the following:
B. No holder of Common Stock shall be entitled as
such as a matter of right to subscribe for or
purchase any part of any new or additional issue of
stock of the Corporation of any class whatsoever or
of securities convertible into stock of any class
whatsoever, whether now or hereafter authorized or
whether issued for money or by way of dividend.
THIRD: The Board of Directors of the Corporation on March 2,
1995, at a meeting duly convened and held, adopted a
resolution which set forth the foregoing amendment to the
Charter, declaring that the said amendment of the Charter
was advisable and in the best interests of the
Corporation and directing that it be submitted for action
thereon to the stockholders of the Corporation.
FOURTH: That the Annual Meeting of the Stockholders of the
Corporation, notice of which having been given as
required by law, was held in New York, N.Y., as provided
by the By-Laws of the Corporation, on May , 1995, and
at said meeting the stockholders, by the affirmative vote
of more than ____ % of all votes entitled to be cast
thereon, (the Charter of the Corporation providing that
notwithstanding any provisions of law requiring any
action to be taken or authorized by the majority or other
designated proportion of the shares or of the shares of
<PAGE>
each class, or otherwise to be taken or authorized by
vote of the stockholders, such action shall be effective
and valid if taken or authorized by the affirmative vote
of the holders of a majority of the total number of
shares outstanding and entitled to vote thereon, except
as otherwise provided in the Charter) duly approved the
amendment of the Charter of the Corporation hereinabove
set forth.
FIFTH: The amendment of the Charter of the Corporation as
hereinabove set forth has been duly advised by the Board
of Directors and approved and adopted by the stockholders
of the Corporation.
IN WITNESS WHEREOF, ALLEGHENY POWER SYSTEM, INC. has caused
these presents to be signed in its name and on its behalf by its
President or one of its Vice Presidents and its corporate seal to
be hereunto affixed and attested by its Secretary or one of its
Assistant Secretaries on May ___ , 1995.
ALLEGHENY POWER SYSTEM, INC.
By: ___________________________(SEAL)
Nancy H. Gormley,
Vice President
ATTEST:
______________________________
Secretary
<PAGE>
CERTIFICATE
THE UNDERSIGNED, Vice President of the Allegheny Power
System, Inc., who executed, on behalf of said Corporation, the
foregoing Articles of Amendment, of which this Certificate is made
a part, hereby acknowledges, in the name and on behalf of the
Corporation, the foregoing Articles of Amendment to be the
corporate act of said Corporation, and further certifies, under the
penalties of perjury and to the best of his/her knowledge,
information and belief, that the matters and facts set forth in the
Articles of Amendment are true in all material respects.
____________________________________
Nancy H. Gormley, Vice President
EXHIBIT F
March 3, 1995
Securities and Exchange Commission
450 5th Street, N.W.
Washington, DC 20549
Gentlemen:
Referring to the Application or Declaration on Form U-1
contemporaneously filed by Allegheny Power System, Inc. (APS) under the Public
Utility Holding Company Act of 1935 with respect to the proposed amendments to
the Charter of APS, as described in the Application or Declaration of which
this Opinion is a part, I have examined such documents and questions of law as
I deemed necessary to enable me to render this opinion.
I understand that the actions taken in connection with the
proposed amendments to the Charter will be in accordance with the Application
or Declaration; that all amendments necessary to complete the above-mentioned
Application or Declaration will be filed with the Commission; that the Board
of Directors of APS will take appropriate action to declare the Charter
amendments advisable; that the Board of Directors will submit said amendments
to a meeting of the stockholders to take action thereon; and that all other
necessary corporate action by the Board of Directors and officers of APS in
connection with the issuance has been or will be taken prior thereto.
Based upon the foregoing, I am of the opinion that
(1) APS is a validly organized and duly existing corporation; and
(2) when (a) the said Application or Declaration is permitted to
become effective, (b) the above-mentioned action shall have been
duly taken, (c) the proposed transaction is consummated in
accordance therewith, (d) the stockholders of APS shall have
approved said amendments, and (e) appropriate Articles of
Amendment shall have been accepted for record by the Maryland
State Department of Assessments and Taxation,
<PAGE>
(i) all state laws applicable to said amendments will have
been complied with; and
(ii) the consummation of said amendments will not violate
the legal rights of the holders of any of the securities
issued by APS or by any associate or affiliate company or
any of them.
This opinion does not relate to State Blue Sky or securities laws.
I consent to the use of this Opinion as part of the Application or
Declaration to which it is appended, which is to be filed by APS.
Very truly yours,
NANCY H. GORMLEY
Nancy H. Gormley
Counsel for
ALLEGHENY POWER SYSTEM, INC.
U:\DUMP\CVOTING\EXHFU-1
EXHIBIT H
SECURITIES AND EXCHANGE COMMISSION
(Release No. 35- : )
Allegheny Power System, Inc.
Notice of Proposed Charter Amendments;
Order Authorizing Solicitation of Proxies
Allegheny Power System, Inc., 12 East 49th Street, New York, New
York, 10017, a Maryland corporation and a registered public utility holding
company (hereinafter "APS") has filed an Application or Declaration pursuant
to Sections 6(a)(2), 7 and 12(e) of the Public Utility Holding Company Act of
1935 (the "Act") and Rules 62 and 65 thereunder. APS requests authority
through December 31, 1996 to amend its Charter and to make conforming
amendments to its By-laws, where appropriate, which would eliminate cumulative
voting provisions and preemptive rights provisions contained therein.
A. Preemptive Rights.
Article VII of APS' Charter currently provides that shares of
common stock and securities convertible into common stock may be issued,
without first being offered to shareholders (a) if sold for money in a public
offering or to or through underwriters or investment bankers who agree to make
a public offering thereof; and (b) in payment for property. Under other
circumstances, shareholders are granted preemptive rights.
Elimination of preemptive rights will give the Board of Directors
of APS greater flexibility and reduce the cost of financings, such as the sale
through private placements of new shares of common stock or senior securities
<PAGE>
convertible into common stock, where currently APS would be required to first
offer shares to existing shareholders. Under certain conditions, these types
of financings enable companies to fund their capital requirement at a savings
of time, expense and overall cost when compared with other forms of
financings.
For APS, which on January 1, 1995 had 119,292,954 shares of common
stock outstanding and listed on the New York Stock Exchange, preemptive rights
are of little significance for shareholders. While elimination of preemptive
rights will reduce the ability of APS' shareholders to preserve their
proportionate interests in APS' common stock, should they so desire they will
be able to maintain their respective proportionate ownership percentages by
purchasing additional shares on the open market. In addition, by
participating in the APS Dividend Reinvestment and Stock Purchase Plan and
through the optional cash payment provision therein, shareholders may increase
their ownership of APS common stock. Thus, shareholders need not rely on
preemptive rights to protect their proportionate interests and voting rights.
<PAGE>
For all of these reasons, APS requests authority to amend its
Charter to eliminate preemptive rights.
B. Cumulative Voting.
Article VII of APS' Charter also currently provides that at the
election of directors, each share of common stock entitles the holder to as
many votes as the number of his or her shares multiplied by the number of
directors to be elected. The holder may cast his or her votes for a single
director or distribute them among two or more directors as the holder sees
fit.
In order for the APS Board of Directors to work effectively for
all the shareholders, each director should feel a responsibility to the
shareholders as a whole and not to any single group of minority shareholders.
If the proposed amendment is approved by the shareholders, the elimination of
cumulative voting will enable the holders of a majority of the shares entitled
to vote in an election to elect all of the directors. Without the ability to
cumulate their votes, it will be more difficult for a holder of a minority of
outstanding shares to obtain representation on the Board of Directors. Under
certain circumstances, the elimination of cumulative voting may also
discourage a merger, tender offer or proxy contest, the assumption of control
by a holder of a large block of APS' common stock, or the removal of incumbent
management.
<PAGE>
For all of these reasons, APS requests authority to amend its
Charter to eliminate cumulative voting.
C. Annual Meeting.
APS proposes to submit to its common shareholders at the annual
meeting of shareholders to be held on or about May 11, 1995, a proposal to
amend APS' Charter to eliminate cumulative voting and preemptive rights. APS
intends to solicit proxies from its shareholders to approve the proposed
Charter amendments. The Charter amendments must be authorized by the vote of
a two-thirds majority of the holders of the outstanding shares of common stock
entitled to vote at the annual meeting. Attached hereto as Exhibit I are
forms of letters of solicitation proposed to be used and forms of all other
documents proposed to be transmitted with such letters of solicitation.
D. Proxy Solicitation.
APS requests that its declaration with respect to the solicitation
of proxies for voting and expenditures of money and other considerations in
connection therewith be permitted to become effective forthwith as provided in
Rule 62(d). Proxies will be solicited by mail and may be solicited by
officers, directors and regular employees of APS personally, by telephone or
facsimile. APS may reimburse persons holding stock in their names or the
names of their nominees for their expenses in sending solicitating materials
to their principals. The cost of the solicitation and annual meeting is not
expected to exceed $331,500.
<PAGE>
Except as described herein, no associate company or affiliate of
APS or any affiliate of any such associate company has any material interest,
directly or indirectly, in the proposed transaction.
The application and any amendments thereto are available for
public inspection through the Commission's Office of Public Reference.
Interested persons wishing to comment or request a hearing should submit their
views in writing by , 1995, to the Secretary, Securities and
Exchange Commission, Washington, DC 20549, and serve a copy to the applicants
at the addresses specified above. Proof of service (by affidavit or, in the
case of an attorney at law, by certificate) should be filed with the request.
Any request for a hearing shall identify specifically the issues of fact or
law that are disputed. A person who so requests will be notified of any
hearing, if ordered, and will receive a copy of any notice or order issued in
this matter. After said date, the application, as filed or as it may be
amended, may be granted.
For the Commission, by the Division of Investment Management
pursuant to delegated authority.
