Page 1 of 8
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Quarterly Report under Section 13 or 15(d)
of the Securities Exchange Act of 1934
For Quarter Ended September 30, 1995
Commission File Number 0-14688
ALLEGHENY GENERATING COMPANY
(Exact name of registrant as specified in its charter)
Virginia 13-3079675
(State of Incorporation) (I.R.S. Employer Identification No.)
12 East 49th Street, New York, New York 10017
Telephone Number - 212-752-2121
The registrant (1) has 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 and (2) has been subject to such filing requirements for the past
90 days.
At November 9, 1995, 1,000 shares of the Common Stock ($1.00 par
value) of the registrant were outstanding.
<PAGE>
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ALLEGHENY GENERATING COMPANY
Form 10-Q for Quarter Ended September 30, 1995
Index
Page
No.
PART I--FINANCIAL INFORMATION:
Statement of income - Three and nine months ended
September 30, 1995 and 1994 3
Balance sheet - September 30, 1995
and December 31, 1994 4
Statement of cash flows - Nine months ended
September 30, 1995 and 1994 5
Notes to financial statements 6
Management's discussion and analysis of financial
condition and results of operations 7
PART II--OTHER INFORMATION 8
<PAGE>
<TABLE>
<CAPTION>
- 3 -
ALLEGHENY GENERATING COMPANY
Statement of Income
Three Months Ended Nine Months Ended
September 30 September 30
1995 1994 1995 1994
(Thousands of Dollars)
<S> <C> <C> <C> <C>
ELECTRIC OPERATING REVENUES $ 21,573 $22,337 $ 65,730 $ 66,637
OPERATING EXPENSES:
Operation and maintenance expense 1,324 1,653 4,691 4,930
Depreciation 4,274 4,236 12,722 12,708
Taxes other than income taxes 1,221 1,399 3,768 4,267
Federal income taxes 3,410 3,498 10,135 10,419
Total Operating Expenses 10,229 10,786 31,316 32,324
Operating Income 11,344 11,551 34,414 34,313
OTHER INCOME AND DEDUCTIONS 5 3 14 10
Income Before Interest Charges 11,349 11,554 34,428 34,323
INTEREST CHARGES:
Interest on long-term debt 4,149 4,230 12,546 12,668
Other interest 236 237 1,256 712
Total Interest Charges 4,385 4,467 13,802 13,380
NET INCOME $ 6,964 $ 7,087 $ 20,626 $ 20,943
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
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ALLEGHENY GENERATING COMPANY
Balance Sheet
September 30 December 31
1995 1994
ASSETS: (THOUSANDS OF DOLLARS)
Property, Plant, and Equipment:
At original cost, including $1,320,000
<S> <C> <C>
and $21,000 under construction $ 838,764 $ 824,714
Accumulated depreciation (156,558) (143,965)
682,206 680,749
Current assets:
Cash 4 45
Accounts receivable 2,963 1,516
Materials and supplies - at average cost 1,985 2,193
Other 524 2,237
5,476 5,991
Deferred Charges:
Regulatory assets 4,372 4,449
Unamortized loss on reacquired debt 10,088 10,653
Other 341 12,394
14,801 27,496
Total Assets $ 702,483 $ 714,236
CAPITALIZATION AND LIABILITIES:
Capitalization:
Common stock - $1.00 par value per share,
authorized 5,000 shares, outstanding
1,000 shares $ 1 $ 1
Other paid-in capital 209,999 209,999
Retained earnings 6,505 12,729
216,505 222,729
Long-term debt:
Debentures, net 148,523 148,454
Commercial paper 33,803 41,736
Medium-term notes 74,600 76,975
473,431 489,894
Current Liabilities:
Long-term debt due within one year 3,375 1,000
Accounts payable 55 48
Interest accrued 1,249 4,900
Other 1,387 536
6,066 6,484
Deferred Credits and Other Liabilities:
Unamortized investment credit 51,305 52,297
Deferred income taxes 143,773 137,297
Regulatory liabilities 27,908 28,264
222,986 217,858
Total Capitalization and Liabilities $ 702,483 $ 714,236
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
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ALLEGHENY GENERATING COMPANY
Statement of Cash Flows
Nine Months Ended
September 30
1995 1994
(Thousands of Dollars)
CASH FLOWS FROM OPERATIONS:
<S> <C> <C>
Net income $20,626 $20,943
Depreciation 12,722 12,708
Deferred investment credit and income taxes, net 5,206 5,022
Changes in certain current assets and
liabilities:
Accounts receivable (1,447) 5,122
Materials and supplies 208 (1)
Accounts payable 7 8
Taxes accrued 849 1,203
Interest accrued (3,651) (3,824)
Other, net 2,416 867
36,936 42,048
CASH FLOWS FROM INVESTING:
Construction expenditures (2,194) (1,086)
CASH FLOWS FROM FINANCING:
Retirement of long-term debt (7,933) (14,323)
Cash dividends on common stock (26,850) (26,625)
(34,783) (40,948)
NET CHANGE IN CASH (41) 14
Cash at January 1 45 15
Cash at September 30 4 29
Supplemental cash flow information:
Cash paid during the period for:
Interest $16,754 $16,507
Income taxes 3,473 5,125
See accompanying notes to financial statements.
</TABLE>
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ALLEGHENY GENERATING COMPANY
Notes to Financial Statements
1. The Company's Notes to Financial Statements in the Allegheny
Power System companies' combined Annual Report on Form 10-K for
the year ended December 31, 1994, should be read with the
accompanying financial statements and the following notes.
With the exception of the December 31, 1994 balance sheet in
the aforementioned annual report on Form 10-K, the accompanying
financial statements appearing on pages 3 through 5 and these
notes to financial statements are unaudited. In the opinion of
the Company, such financial statements together with these
notes thereto contain all adjustments (which consist only of
normal recurring adjustments) necessary to present fairly the
Company's financial position as of September 30, 1995, the
results of operations for the three and nine months ended
September 30, 1995 and 1994, and cash flows for the nine months
ended September 30, 1995 and 1994.
2. The Statement of Income reflects the results of past operations
and is not intended as any representation as to future results.
For purposes of the Balance Sheet and Statement of Cash Flows,
temporary cash investments with original maturities of three
months or less, generally in the form of repurchase agreements,
are considered to be the equivalent of cash.
3. Common stock dividends per share declared and paid during the
periods for which income statements are included are as
follows:
<TABLE>
<CAPTION>
1995 1994
Number Amount Number Amount
of Shares Per Share of Shares Per Share
<S> <C> <C> <C> <C>
First Quarter 1,000 $8,950 1,000 $8,875
Second Quarter 1,000 $8,950 1,000 $8,875
Third Quarter 1,000 $8,950 1,000 $8,875
</TABLE>
Earnings per share are not reported inasmuch as the common
stock of the Company is 100% owned by its parents, Monongahela
Power Company (27%), The Potomac Edison Company (28%), and West
Penn Power Company (45%).
<PAGE>
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ALLEGHENY GENERATING COMPANY
Management's Discussion and Analysis of Financial Condition
and Results of Operations
COMPARISON OF THIRD QUARTER AND NINE MONTHS ENDED SEPTEMBER 30, 1995
WITH THIRD QUARTER AND NINE MONTHS ENDED SEPTEMBER 30, 1994
The changes in revenues and net income are primarily
due to changes in the Company's net plant (the major component of rate
base).
The decrease in taxes other than income taxes for the
third quarter and first nine months of 1995 was primarily due to a
decrease in property taxes.
The increase in other interest for the nine months
ended September 1995 was due to interest paid on the revenue refund
pursuant to the settlement agreement described below.
LIQUIDITY AND CAPITAL RESOURCES
The Company's discussion on Liquidity and Capital
Resources and Results of Operations in the Allegheny Power System
companies' combined Annual Report on Form 10-K for the year ended December
31, 1994, should be read with the following information.
On March 23, 1995, the Federal Energy Regulatory
Commission (FERC) approved a settlement agreement filed for cases to
determine the return on equity (ROE) earned by the Company. The Company's
ROE was reduced to 11.13% for the period from March 1, 1992 through
December 31, 1994, and increased to 11.20% beginning in 1995. In April
1995, revenue refunds for the period March 1992 through December 1994,
including interest, were made to customers, for which adequate reserves
had previously been provided.
On May 22, 1995, the FERC approved a settlement
agreement resulting in the inclusion in Property, Plant, and Equipment,
and rate base, effective June 1, 1995, of a prior tax payment of
approximately $12 million, previously recorded on the balance sheet as
Deferred Charges. This regulatory decision will produce about $1.4
million in additional annual revenues.
<PAGE>
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ALLEGHENY GENERATING COMPANY
Part II - Other Information to Form 10-Q
for Quarter Ended September 30, 1995
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits:
(3)(ii) By-laws of the Company, as amended, dated
November 2, 1995
(27) Financial Data Schedule
(b) Reports on Form 8-K:
No reports on Form 8-K were filed on behalf of the
Company for the quarter ended September 30, 1995.
Signature
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.
ALLEGHENY GENERATING COMPANY
THOMAS J. KLOC
Thomas J. Kloc
Controller
(Chief Accounting Officer)
November 9, 1995
BY-LAWS
of
ALLEGHENY GENERATING COMPANY
(As amended to November 2, 1995)
ARTICLE 1.
Definitions, etc.
Section 1.1. Definitions. For all purposes of
these By-laws, unless the context otherwise requires:
(a) "Charter" means the Articles of Incorporation
of Allegheny Generating Company, as amended from time to time
by all amendments thereto (if any).
(b) "Board" means the Board of Directors of the
Corporation.
(c) "Treasury shares" means share of the Corpo-
ration which have been issued, have been subsequently
reacquired and belong to the Corporation, and have not been
effectively cancelled by the issuance of a certificate of
reduction by the State Corporation Commission of Virginia.
(d) Whenever reference is made to stockholders
present at a meeting, the reference shall include every
stockholder present in person or by proxy appointed by
instrument in writing and subscribed by such stockholder
or by such stockholder's attorney-in-fact thereunto duly
authorized; and, whenever reference is made to action by
any stockholder at or in connection with any meeting, the
reference shall include action in person or by such proxy.
No proxy shall be valid after 11 months from its date, unless
otherwise provided in the proxy.
(e) All references to Articles and Sections are
to Articles and Sections of these By-laws; and the words
"herein," "hereof," "hereby" and "hereunder" and other
equivalent words, refer to these By-laws and not to any
particular Article, Section or subdivision.
Section 1.2. Action Without Meeting. Except as
otherwise expressly provided by law or in the Charter, (a) any
action which might be taken at a meeting of stockholders may
be taken without a meeting by a written consent setting forth
such action, signed by all the stockholders who would be
entitled to vote with respect to the subject matter thereof at
the meeting if it were held, and filed with the minutes of
proceedings of the stockholders, and (b) any action which
might be taken at a meeting of the Board or of a committee may
be taken without a meeting by written consent setting forth
such action, signed by all the directors or all the members of
such committee, as the case may be, and filed with the minutes
of the proceedings of the Board or such committee, as the case
may be.
ARTICLE 2.
Meetings of Stockholders.
Section 2.1. Annual Meeting. The annual meeting of
stockholders for the election of directors and for the trans-
action of such other business as may properly come before it
shall be held on the first Thursday in March in each year, but
if that be a legal holiday under the laws of the state where
such meeting is to be held, then on the next succeeding day
not a holiday, at such hour and at such place as may be stated
in the notice of said meeting.
Section 2.2. Special Meetings. A special meeting
of stockholders maybe called at any time by the Chairman of
the Board, if there be one, or by the President, and shall be
called by the Secretary when so ordered by a majority of the
directors or upon the written request, stating the purpose of
the meeting, of stockholders holding of record not less than
one-tenth of all the shares entitled to vote at such meeting.
Section 2.3. Notice of Stockholders' Meetings.
Written notice stating the place, day and hour of each meeting
of stockholders and, in the case of a special meeting, the
purpose or purposes for which the meeting is called, shall be
given not less than 10 nor more than 50 days before the date
of the meeting (except as a different time is specified
below), either personally or by mail, by or at the direction
of the Chairman of the Board, if there by one, the President
or any Vice President or the Secretary or any Assistant
Secretary, to each stockholder of record entitled to vote at
the meeting, at his or her address as it appears on the Stock
Book. If mailed, such notice shall be deemed to be given when
deposited in the United States mail addressed to the
stockholder at his or her address as it appears in the stock
transfer books, with postage thereon prepaid.
Notice of a meeting of stockholders to act on an
amendment of the Charter or on a reduction of stated capital
or on a plan of merger, consolidation or exchange shall be
given, in the manner provided above, not less than 25 nor more
than 50 days before the date of the meeting. Any such
<PAGE>
notice shall be accompanied by a copy of the proposed amend-
ment or plan of reduction or merger, consolidation or
exchange.
Any meeting at which all stockholders having voting
power in respect of the business to be transacted thereat are
present, either in person or by proxy, or of which those not
present waive notice in writing, whether before or after the
meeting, shall be a legal meeting for the transaction of
business notwithstanding that notice has not been given as
hereinbefore provided.
Section 2.4. Quorum. Except as otherwise provided
by law or the Charter, at each meeting of stockholders the
holders of a majority of the shares of stock of the Corpora-
tion entitled to vote thereat, represented in person or by
proxy, shall constitute a quorum. Whether or not there is a
quorum at any meeting, the stockholders present and entitled
to cast a majority of the votes thereat, or in the absence of
all the stockholders any officer entitled to preside or act as
secretary at such meeting, may adjourn the meeting from time
to time. At any such adjourned meeting at which a quorum is
present, any business may be transacted which might have been
transacted at the meeting as originally called.
Section 2.5. Organization. At each meeting of
stockholders, the President, or, in the absence of the
President, a Vice President designated by the President, or,
in the absence of such designation, a chairman chosen by the
stockholders present and entitled to cast a majority of the
votes thereat, shall preside. The Secretary of the Corpora-
tion or, in the absence of the Secretary, an Assistant
Secretary, or, if none is present, some other person desig-
nated by the chairman of the meeting, shall act as secretary
of the meeting.
Section 2.6. Voting. Except as otherwise provided
by law or the Charter, at any meeting of stockholders every
stockholder present shall be entitled to one vote for each
share of stock entitled to vote thereat standing in his or her
name on the books of the Corporation at the record date fixed
as provided in Section 8.3.
Neither treasury shares, nor shares held by another
corporation if a majority of the shares entitled to vote for
the election of directors of such other corporation is held by
the Corporation, shall be voted at any meeting or counted in
determining the total number of outstanding shares entitled to
vote at any given time. If the Corporation holds shares of
its own stock in a fiduciary capacity, they may be counted to
establish a quorum, but, if the Corporation is sole fiduciary,
they may not be voted and, if the Corporation is a fiduciary
jointly with another, the other may vote the shares.
If a quorum is present, the affirmative vote of the
majority of the shares represented at the meeting and entitled
to vote on the subject matter shall be the act of the stock-
holders, unless the vote of a greater number is required by
law or the Charter and except that in elections of directors
those receiving the greatest number of votes shall be deemed
elected even though not receiving a majority.
ARTICLE 3.
Board of Directors.
Section 3.1. General Powers. The property, affairs
and business of the Corporation, except as otherwise expressly
provided by law or by the Charter, shall be managed by the
Board.
Section 3.2. Number, Election and Term of Office.
A Board of Directors shall be elected at the annual meeting of
stockholders, and, subject to Section 3.9 and 3.10, each
director shall hold office until the next annual meeting of
stockholders and until his or her successor shall have been
elected and qualified, or until his or her death, resignation,
disqualification or removal. Directors need not be residents
of Virginia and need not be stockholders. The number of
directors shall be not more than eight, but the number of
directors may from time to time be increased to any number not
exceeding eight, or may be decreased to any number not less
than three, by the affirmative vote of a majority of the
entire Board of Directors. The tenure of office of an
incumbent director shall not be affected by any decrease in
the number of directors.
Section 3.3. Chairman of the Board. The Board may
choose from its membership a Chairman of the Board. The
Chairman of the Board, if there be one, shall preside at all
meetings of the Board and shall have such other powers and
duties as from time to time are given him or her by the Board.
Section 3.4. Meetings. The Board by resolution may
provide for regular meetings and may fix the time and place of
such meetings.
Special meetings shall be held whenever called by
the Chairman of the Board or by the President or by a majority
of the directors.
<PAGE>
Section 3.5. Place of Meetings. The Board may hold
its meetings at such place or places, within or without the
Commonwealth of Virginia, as the Board from time to time may
determine or as may be designated in waivers of notice thereof
signed by all the directors.
Section 3.6. Notice of Meeting. Notice need not be
given of any regular meeting of the Board if the time and
place of such meeting are specified in a resolution of the
Board prior to the meeting and if notice of the adoption of
such resolution is given, in the manner herein provided for
giving notice of meetings, to each director who was absent
from the meeting at which the resolution was adopted. Except
as otherwise required by law, notice of the time and place of
each other meeting of the Board shall be mailed to each
director at his or her residence or usual place of business or
at such other address as such director may have designated in
writing to the Secretary, at least two days before the day of
the meeting, or shall be sent to such director at such address
by telegram, telex or cablegram, or given personally or by
telephone, at least 24 hours before the time for the meeting,
unless, in case of exigency, the Chairman of the Board or the
President shall prescribe a shorter notice to be given
personally or by telephoning or telegraphing each director at
his or her residence or business address. Notice of a meeting
of the Board need not state the purpose thereof, except as
otherwise expressly provided by law.
Section 3.7. Quorum and Manner of Acting. Except
as otherwise provided in Section 3.11, at each meeting of the
Board a majority of the total number of directors, but not
less than two directors, shall constitute a quorum for the
transaction of business, and, except as otherwise provided by
law or in the Charter or in Sections 3.11, 4.1, 4.5, 4.6 or
5.3, the act of a majority of the directors present at any
such meeting at which a quorum is present shall be the act of
the Board.
Unless otherwise restricted by the Charter, members
of the Board or any committee designated by the Board may
participate in a meeting of the Board or such committee by
means of a conference telephone or similar communications
equipment whereby all persons participating in the meeting can
hear each other, and participation by such means shall
constitute presence in person at such meeting. When such a
meeting is conducted by means of a conference telephone or
similar communications equipment, a written record shall be
made of the action taken at such meeting.
<PAGE>
Whether or not there is a quorum at a meeting, a
majority of the directors who are present may adjourn the
meeting from time to time to a day certain. No notice of an
adjourned meeting need be given. The directors shall act only
as a Board, and the individual directors shall have no power
as such.
Section 3.8. Organization. At each meeting of the
Board, the Chairman of the Board, if there be one, or, in the
absence of the Chairman of the Board, the President or, in the
absence of the President, a chairman (who shall be a Vice
President, if any is present) chosen by a majority of the
directors present, shall preside. The Secretary of the Corpo-
ration or, in the absence of the Secretary, an Assistant
Secretary or, if none is present, some other person designated
by the chairman of the meeting, shall act as secretary of the
meeting.
Section 3.9. Resignations. Any director may resign
at any time by giving written notice to the Chairman of the
Board or to the Secretary of the Corporation or to the Board.
A resignation shall take effect at the time specified therein
and, unless otherwise specified therein, acceptance of such
resignations shall not be necessary to make it effective.
Section 3.10. Removal of Directors. Except as
otherwise provided by law or the Charter, any director may be
removed, either with or without cause, at any time, by a vote
of the holders of a majority of the shares of stock of the
Corporation entitled to vote for the election of directors, at
a meeting of the stockholders called expressly for that
purpose.
Section 3.11. Vacancies. Except as otherwise pro-
vided by law or by the Charter, (a) any vacancy occurring in
the Board for any cause other than by reason of an increase in
the number of directors by more than two, may be filled by a
majority of the remaining members of the Board, although such
majority is less than a quorum, (b) any vacancy occurring in
the Board for any cause whatsoever may be filled by the stock-
holders entitled to vote upon an election of directors, at the
next annual meeting held, or at the meeting of stockholders at
which such vacancy was created, or at a meeting of
stockholders called for the purpose of filling such vacancy.
The directors so appointed or elected shall, subject to
Sections 3.9 and 3.10, hold office until the next annual
election of directors and until their successors have been
duly elected and qualified.
<PAGE>
Section 3.12. Remuneration. Directors shall be
entitled to receive such remuneration as may be fixed from
time to time by resolutions of the Board, in the form of pay-
ment of a fixed sum per month or of fees for attendance at
meetings of the Board and committees thereof, or both. Direc-
tors shall also be entitled to be reimbursed for expenses
incurred in attending any meeting or otherwise in connection
with their attention to the affairs of the Corporation.
Nothing herein shall preclude any director from serving in any
other capacity or receiving compensation for such service.
ARTICLE 4.
Executive and Other Committees.
Section 4.1 General Powers and Membership. The
Board, by resolution adopted by a majority of the whole Board,
may elect from its members, an Executive Committee and one or
more other committees, each consisting of two or more members
of the Board. Unless otherwise expressly provided by law or
by the Charter or by resolution of the Board, the Executive
Committee shall have and may exercise all the powers of the
Board (except to approve an amendment of the Charter, a plan
of merger or consolidation, a plan of exchange under which the
Corporation would be acquired, the sale, lease or exchange, or
the mortgage or pledge for a consideration other than money,
of all, or substantially all, the property and assets of the
Corporation otherwise than in the usual and regular course of
its business, the voluntary dissolution of the Corporation, or
revocation of voluntary dissolution proceedings) when the
Board is not in session, and each other committee shall have
and may exercise such powers as the Board shall confer. In
the absence of any member of any such committee, the members
thereof present at any meeting, whether or not they constitute
a quorum,, may appoint a member of the Board to act in the
place of such absent member. Insofar as the rights of third
parties shall not be affected thereby, all action by any
committee shall be subject to revision and alteration by the
Board.
Section 4.2. Organization. Unless otherwise pro-
vided by resolution of the Board, a chairman chosen by each
committee shall preside, and the Secretary of the Corporation
shall act as secretary, at all meetings of each committee
thereof. In the absence of the Secretary, the chairman of the
meeting shall designate an Assistant Secretary, or, if none is
present, some other person, to act as secretary of the
meeting.
Section 4.3. Meetings. Each committee may deter-
mine the time and place, and the method of calling, its
meetings and the conduct of its proceedings.
Section 4.4. Quorum and Manner of Acting. Except
as otherwise provided in Section 4.1, at each meeting of a
committee a majority of the total number of members thereof
shall constitute a quorum for the transaction of business, and
the act of a majority of the members present at any such meet-
ing at which a quorum is present shall be the act of such
committee. The committees shall keep minutes of their pro-
ceedings and shall report the same to the Board at the meeting
of the Board next ensuing. The members of each committee
shall act only as a committee, and the individual members
shall have no power as such.
Section 4.5. Removal. Any member of any committee
may be removed, either with or without cause, at any time, by
resolution adopted by a majority of the whole Board.
Section 4.6. Vacancies. Any vacancy in any commit-
tee shall be filled in the manner prescribed for the regular
election of the members of that committee.
ARTICLE 5.
Officers.
Section 5.1. Election, Term of Office and Quali-
fications. The Board shall elect annually from its membership
a President. It shall also elect annually a Secretary and a
Treasurer, and may elect one or more Vice Presidents (includ-
ing an Executive Vice President) and any other officers whose
appointment shall not be delegated as provided in Section 5.2.
Each officer shall, subject to Sections 5.3 and 5.4, hold
office until the next annual election and until his or her
successor is chosen and qualified. One person may hold any
two or more offices, except those of President and Secretary.
No instrument shall be executed, acknowledged or verified by
the same individual in more than one such capacity if such
instrument is required by law, the Charter or these By-laws to
be executed, acknowledged or verified by two or more officers.
The executive officers of the Corporation shall be the Presi-
dent, the Vice Presidents, the Secretary and the Treasurer.
Section 5.2. Other Officers. The Board may autho-
rize any executive officer or committee to appoint such other
officers or agents as the Board or the appointing officer or
committee may deem advisable, including one or more Assistant
Treasurers and one or more Assistant Secretaries, each of whom
shall hold office for such period, have such powers and
perform such duties as are provided herein or as the Board or
the appointing executive officer or committee may from time to
time determine. Any such officer, if required by the Board or
by the appointing executive officer or committee, shall give
bond for the faithful discharge of his or her duty in such sum
and with such surety as the Board or the appointing executive
officer or committee shall require.
Section 5.3. Removal. Any officer or agent may be
removed, either with or without cause, at any time, by resolu-
tion adopted by a majority of the whole Board or by the execu-
tive officer or committee by whom such officer shall have been
appointed, or by any executive officer or committee upon whom
the power of removal has been conferred by resolution adopted
by a majority of the whole Board.
Section 5.4. Resignations. Any officer may resign
at any time by giving written notice to the President or to
the Secretary or to the Board. A resignation shall take
effect at the time specified therein and, unless otherwise
specified therein, the acceptance of such resignation shall
not be necessary to make it effective.
Section 5.5. Vacancies. A vacancy in any office
may be filled in the manner prescribed for regular election or
appointment to that office.
Section 5.6. President. The President shall be the
chief executive officer of the Corporation and shall have
general supervision of the business of the Corporation and
over its officers, subject, however, to the control of the
Board. The President may execute, in the name of the Corpo-
ration, deeds, mortgages, bonds, contracts and other instru-
ments authorized by the Board; and, in general, shall have all
powers and duties incident to the office and such others as
from time to time may given him or her by the Board or by any
committee thereunto authorized.
The President shall, unless otherwise directed by
the Board or by any committee thereunto authorized, attend in
person or by substitute or proxy appointed by him or her, and
act and vote in behalf of the Corporation, at all meetings of
the stockholders of any corporation in which the Corporation
holds stock.
Section 5.7. Vice Presidents. At the request, or
in the absence or disability, of the President, any Vice
President may perform all the duties of the President, and,
when so acting, shall have all the powers of the President.
Any Vice President may sign and execute, in the name of the
Corporation, deeds, mortgages, bonds, contracts or other
instruments authorized by the Board; may, unless otherwise
directed by the Board or any committee thereunto authorized,
attend in person or by substitute or proxy appointed by such
Vice President, and act and vote in behalf of the Corporation,
at all meetings of the stockholders of any corporation in
which the Corporation holds stock; and shall have such other
powers and duties as from time to time may be assigned to such
Vice President by the President or by the Board or by any
committee thereunto authorized.
Section 5.8. Secretary. The Secretary shall record
or cause to be recorded in books provided for the purpose all
the proceedings of the meetings of the Corporation, including
those of the stockholders, the Board and all committees for
which a secretary shall not have been appointed; shall see
that all notices are duly given in accordance with these By-
laws or as required by law; shall be custodian of the records
(other than financial) and of the seal of the Corporation;
and, in general, shall have all powers and duties incident to
the office of Secretary and such others as from time to time
may be assigned to him or her by the President or by the Board
or by any committee thereunto authorized.
Section 5.9. Assistant Secretaries. At the
request, or in the absence or disability, of the Secretary,
any Assistant Secretary may perform all the duties of the
Secretary and, when so acting, shall have all the powers of
the Secretary. Each Assistant Secretary shall perform such
other duties as from time to time may be assigned to him or
her by the President or the Secretary or by the Board or by
any committee thereunto authorized.
Section 5.10. Treasurer. The Treasurer, if requir-
ed by the Board, shall give a bond for the faithful discharge
of his or her duty, in such sum and with such surety as the
Board shall require. The Treasurer shall prepare or cause to
be prepared annually a full and correct statement of the
affairs of the Corporation, including a balance sheet and a
financial statement of operations for the preceding fiscal
year, which shall be submitted at the annual meeting of the
stockholders. The Treasurer shall have charge and custody of,
and be responsible for, all funds and securities of the Corpo-
ration and shall deposit or cause to be deposited all such
funds and securities in the name of the Corporation in such
depositories as shall be selected by the Board, or any commit-
tee, officer, or agent authorized by the Board to make such
selection; may receive, and give receipt for, moneys paid to
the Corporation and, subject to the direction of the Board, or
of any committee thereunto authorized, or of the President,
pay out and supervise the disbursement of moneys of the
Corporation; and in general, shall have all powers and duties
incident to the office of Treasurer and such others as from
time to time may be assigned to him or her by the President or
by the Board or by any committee thereunto authorized.
Section 5.11. Assistant Treasurers. Each Assistant
Treasurer, if required by the Board, shall give bond for the
faithful discharge of his or her duty, in such sum and with
such surety as the Board shall require. At the request, or in
the absence or disability, of the Treasurer, any Assistant
Treasurer may perform all the duties of the Treasurer, and,
when so acting, shall have all the powers of the Treasurer.
Each Assistant Treasurer shall perform such other duties as
from time to time may be assigned to such Assistant Treasurer
by the President or the Treasurer or by the Board or by any
committee thereunto authorized.
Section 5.12. Salaries. The compensation of each
officer shall be fixed from time to time by the Board or the
Executive Committee. No officer shall be precluded from
receiving such compensation by reason of the fact that such
officer is also a director of the Corporation.
ARTICLE 6.
Indemnification of Directors, Officers
and Employees.
Section 6.1. The Corporation shall indemnify any
person who was or is a party or is threatened to be made a
party to any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative, arbitra-
tive or investigative (other than an action by or in the right
of the Corporation) by reason of the fact that such person is
or was a director, officer or employee of the Corporation, or
is or was serving at the request of the Corporation as a
director, officer or employee of another corporation, partner-
ship, joint venture, trust or other enterprise, against
expenses (including attorneys' fees), judgments, fines and
amounts paid in settlement actually and reasonably incurred by
such person in connection with such action, suit or proceeding
if such person acted in good faith and in the manner he or she
reasonably believed to be in or not opposed to the best
interests of the Corporation, and, with respect to any crimi-
nal action or proceeding, had no reasonable cause to believe
his or her conduct was unlawful. The termination of any
action, suit or proceeding by judgment, order, settlement,
conviction, or upon a plea of nolo contendere or its
equivalent, shall not of itself create a presumption that the
person did not act in good faith and in a manner which he or
she reasonably believed to be in or not opposed to the best
interests of the Corporation, and, with respect to any crimi-
nal action or proceeding, had reasonable cause to believe that
his or her conduct was unlawful.
Section 6.2. The Corporation shall indemnify any
person who was or is a party or is threatened to be made a
party to any threatened, pending or completed action or suit
by or in the right of the Corporation to procure a judgment in
its favor by reason of the fact that such person is or was a
director, officer or employee of the Corporation, or is or was
serving at the request of the Corporation as a director,
officer or employee of another corporation, partnership, joint
venture, trust or other enterprise against expenses (including
attorneys' fees) actually and reasonably incurred by such
person in connection with defense or settlement of such action
or suit if such person acted in good faith and in a manner he
or she reasonably believed to be in or not opposed to the best
interests of the Corporation and except that no indemnifica-
tion shall be made in respect of any claim, issue or matter as
to which such person shall have been adjudged to be liable for
negligence or misconduct in the performance of his or her duty
to the Corporation unless and only to the extent that the
court in which such action or suit was brought shall determine
upon application that, despite the adjudication of liability
but in view of all circumstances of the case, such person is
fairly and reasonably entitled to indemnity for such expenses
which such court shall deem proper.
Section 6.3. To the extent that a director, officer
or employee of the Corporation has been successful on the
merits or otherwise in defense of any action, suit or proceed-
ing referred to in Sections 6.1 and 6.2 or in defense of any
claim, issue or matter therein, he or she shall be indemnified
against expenses (including attorneys' fees) actually and
reasonably incurred by him or her in connection therewith.
Section 6.4. Any indemnification under Sections 6.1
and 6.2 (unless ordered by a court) shall be made by the
Corporation only as authorized in the specific case upon a
determination that indemnification of the director, officer or
employee is proper in the circumstances because he or she has
met the applicable standard of conduct set forth in Sections
6.1 and 6.2. Such determination shall be made (1) by the
Board of Directors by a majority vote of a quorum consisting
of directors who were not parties to such action, suit or
proceeding, or (2) if such a quorum is not obtainable, or, <PAGE>
even if obtainable a quorum of disinterested directors so
directs, by independent legal counsel in a written opinion, or
(3) by the stockholders.
Section 6.5. Expenses (including attorneys' fees)
incurred in defending an action, suit or proceeding, whether
civil, criminal, administrative, arbitrative or investigative,
may be paid by the Corporation in advance of the final dis-
position of such action, suit or proceeding as authorized in
the manner provided in Section 6.4 upon receipt of an under-
taking by or on behalf of the director, officer or employee to
repay such amount unless it shall ultimately be determined
that he or she is entitled to be indemnified by the Corpo-
ration as authorized in this section.
Section 6.6. The indemnification provided by this
Article shall not be deemed exclusive of or in any way to
limit any other rights to which any person indemnified may be
or may become entitled as a matter of law, by the charter,
regulations, agreements, insurance, vote of stockholders or
otherwise, with respect to action in such person's official
capacity and with respect to action in another capacity while
holding such office and shall continue as to a person who has
ceased to be a director, officer or employee and shall inure
to the benefit of the heirs, executors, administrators, and
other legal representatives of such person.
Section 6.7. Sections 6.1 through 6.6 of this
Article shall also apply to such other agents of the
Corporation as are designated for such purposes at any time by
the Board of Directors.
Section 6.8. If any part of this Article shall be
found, in any action, suit or proceeding, to be invalid or
ineffective, the validity and the effect of the remaining
parts shall not be affected.
Section 6.9. The provisions of this Article shall
be applicable to claims, actions, suits or proceedings made or
commenced after the adoption hereof, whether arising from acts
or omissions to act occurring before or after the adoption
hereof.
Section 6.10. For the purpose of this Article,
references to the "Corporation" include all constituent
corporations absorbed in a consolidation or merger as well as
the resulting or surviving corporation so that any person who
is or was a director, officer or employee of such a consti-
tuent corporation or is or was serving at the request of such
constituent corporation as a director, officer or employee of
another corporation, partnership, joint venture, trust or
other enterprise shall stand in the same position under the
provisions of this Article with respect to the resulting or
surviving corporation as such person would if such person had
served the resulting or surviving corporation in the same
capacity.
ARTICLE 7.
Contracts, Checks, Drafts, Bank Accounts, etc.
Section 7.1 Contracts, etc., How Executed. The
Board or any committee thereunto authorized may authorize any
officer or officers or agent or agents of the Corporation to
enter into any contract or execute and deliver any contract or
other instrument in the name and on behalf of the Corpo-
ration, and such authority may be general or confined to
specific instances. Unless authorized so to do by the Board
or any committee thereunto authorized, no officer, agent or
employee shall have any power or authority to bind the Corpo-
ration by any contract or engagement or to pledge its credit
or to render it liable pecuniarily for any purpose or to any
amount.
Section 7.2. Loans. No loan shall be contracted on
behalf of the Corporation, and no negotiable paper shall be
issued in its name, unless authorized by the Board or any
committee thereunto authorized. Such authority may be general
or confined to specific instances. When so authorized, the
officer or officers thereunto authorized may effect loans and
advances at any time for the Corporation from any bank, trust
company or other institution or from any firm, corporation or
individual, and for such loans and advances may make, execute
and deliver promissory notes or other evidences of indebted-
ness of the Corporation and, when authorized as aforesaid, as
security for the payment of any and all loans, advances,
indebtedness and liabilities of the Corporation, may mortgage,
pledge, hypothecate or transfer any real or personal property
at any time held by the Corporation and to that end execute
instruments of mortgage or pledge or otherwise transfer such
property.
Section 7.3. Checks, Drafts, etc. All checks,
drafts, bills of exchange or other orders for the payment of
money, obligations, notes, acceptances, or other evidences of
indebtedness, bills of lading, warehouse receipt and insurance
certificates issued in the name of the Corporation, shall be
signed or endorsed by such officer or officers, agent <PAGE>
or agents, of the corporation, and in such manner, as shall
from time to time be determined by resolution of the Board or
any committee thereunto authorized.
Section 7.4. Deposits. Unless otherwise provided
by resolution of the Board or any committee thereunto autho-
rized, endorsements for deposit to the credit of the Corpora-
tion in any of its duly authorized depositories may be made,
without countersignature, by the President or any Vice
President or the Treasurer, or by any other officer or agent
of the Corporation to whom such power shall have been delegat-
ed by the Board or such committee, or may be made by stamped
impression in the name of the Corporation.
Section 7.5. Proxies. Unless otherwise provided by
resolution of the Board or any committee thereunto authorized,
the President or any Vice President may from time to time
appoint an attorney or attorneys or agent or agents, of the
Corporation, in the name and on behalf of the Corporation, to
cast the votes which the Corporation may be entitled to cast
as the holder of stock or other securities in any other
corporation, any of whose stock or other securities may be
held by the Corporation, at meetings of the holders of the
stock or other securities of such other corporation, or to
consent in writing, in the name of the Corporation as such
holder, to any action by such other corporation, and may
instruct the person or persons so appointed as to the manner
of casting such votes or giving such consent, and may execute
or cause to be executed in the name and on behalf of the
Corporation and under its corporate seal, or otherwise, all
such written proxies or other instruments as he or she may
deem necessary or proper in the premises.
ARTICLE 8.
Books and Records.
Section 8.1. Place, etc. The Board may keep the
books and records of the Corporation at such places within or
without the Commonwealth of Virginia, as it may from time to
time determine. The stock record books and the blank stock
certificate books shall be kept by the Secretary or by a
transfer agent or by any other officer or agent designated by
the Board or any committee thereunto authorized. The original
or a duplicate stock ledger containing the names and addresses
of the stockholders and the number of shares held by them,
respectively, shall be kept at the principal office or place
of business of the Corporation. The original or a certified
copy of these By-laws, as amended from time to time, shall be
kept at the principal office of the Corporation. Any books,
records and minutes may be in written form or in any other
form capable of being converted into written form within a
reasonable time. The Corporation shall convert into written
form without charge any such records not in such form upon the
written request of any person entitled to inspect them.
Section 8.2. Addresses of Stockholders. Each
stockholder shall designate to the Secretary or transfer agent
of the Corporation an address at which notices of meetings and
all other corporate notices may be served upon or mailed to
such stockholder, and if any stockholder shall fail to
designate such address, corporate notices may be served upon
such stockholder by mail directed to such stockholder at such
stockholder's last known post office address.
Section 8.3. Record Date and Closing of Stock
Transfer Books. For the purpose of determining the stock-
holders entitled to notice of or to vote at any meeting of
stockholders or any adjournment thereof, or entitled to
receive payment of any dividend, or in order to make a
determination of stockholders for any other proper purpose,
the Board may provide that the stock transfer books shall be
closed for a stated period, which shall not, in any case,
exceed 50 days. In lieu of closing the stock transfer books,
the Board may fix in advance a date as the record date for any
such determination of stockholders, provided that such date
shall not in any case be more than 50 days prior to the date
on which the particular action, requiring such determination
of stockholders, is to be taken. If the stock transfer books
shall not be closed and no record date shall be fixed for the
determination of stockholders entitled to notice of or to vote
at a meeting of stockholders, or for the determination of
stockholders entitled to receive payment of a dividend, the
date on which notice of the meeting is mailed or the date on
which the resolution of the Board declaring such dividend is
adopted, as the case may be, shall be the record date for such
determination of stockholders. When a determination of stock-
holders entitled to vote at any meeting of stockholders has
been made as provided in this Section, such determination
shall apply to any adjournment thereof.
Section 8.4. Examination of Books by Stockholders.
The Board shall have power to determine, from time to time,
whether and to what extent and what times and places and under
what conditions and regulations the accounts, corporate
records, books and documents of the Corporation, or any of
them, shall be open to the inspection of the stockholders;
and, except as otherwise provided by law, no stockholder shall
have any right to inspect any account, corporate record, book <PAGE>
or document of the Corporation, unless and until authorized so
to do by resolution of the Board or of the stockholders of the
Corporation.
ARTICLE 9.
Shares and Their Transfer
Section 9.1. Certificates. The shares of the
Corporation shall be represented by certificates signed by the
President or a Vice President and by the Secretary or an
Assistant Secretary or the Treasurer or an Assistant Treasurer
or any other officer authorized by a resolution of the Board
and may (but need not) be sealed with the seal of the Corpo-
ration, which may be facsimile, engraved or printed. When any
such certificate is countersigned by a transfer agent, or
registered by a registrar, other than the Corporation itself
or an employee of the Corporation, the signatures of the
officers upon such certificate may be facsimiles. In case any
officer who shall have signed, or whose facsimile signature
shall have been placed upon, any such certificate shall cease
to be such officer of the Corporation before such certificate
is issued, such certificate may nevertheless be issued by the
Corporation with the same effect as if the person who signed
such certificate or whose facsimile signature shall have been
placed thereon were such officer at the date of its issue.
Section 9.2. Record, etc. A record shall be kept
in the stock transfer books of the name of the person, firm or
corporation owning the stock represented by each certificate
for stock of the Corporation issued, the number and class of
shares represented by each such certificate, and the date
thereof, and, in the case of cancellation, the date of
cancellation. Every certificate surrendered to the Corpo-
ration for exchange or transfer shall be cancelled, and no new
certificate or certificates shall be issued in exchange for
any existing certificate until such existing certificate
shall have been so cancelled except in cases provided for in
Section 9.5. The person in whose name shares of stock stand
in the stock transfer books shall be deemed the owner thereof
for all purposes as regards the Corporation.
Section 9.3. Transfer of Shares. Transfers of
shares of the stock of the Corporation shall be made on the
books of the Corporation by the holder of record, or by such
holder's attorney thereunto duly authorized, upon surrender of
the certificates for such shares, but no share shall be
transferred until all previous calls thereon shall have been
fully paid.
Section 9.4. Transfer Agents and Registrars. The
Board may appoint one or more transfer agents and registrars
for stock of the Corporation of any class and may require
stock certificates to be countersigned or registered by one or
more of such transfer agents or registrars.
Section 9.5. Lost and Destroyed Certificates. The
holder of record of any certificate of stock who shall claim
that such certificate is lost or destroyed may make an affi-
davit or affirmation of that fact in such manner as the Board
may require and give a bond, if required by the Board, in such
form and sum and with such surety as the Board shall require,
to indemnify the Corporation against any claim that may be
made against it on account of such certificate, whereupon one
or more new certificates may be issued of the same tenor and
for the same aggregate number of shares as the certificate
alleged to be lost or destroyed. The Board may delegate
authority to administer the provisions of this Section.
ARTICLE 10.
Notice.
Section 10.1. Waiver of Notice. No notice of the
time, place or purpose of any meeting of stockholders or
directors, or of any committee, or any publication thereof,
whether prescribed by law, by the Charter or by these By-laws,
need be given to any person who attends the meeting, or who,
in writing, executed either before or after the meeting and
filed with the records of the meeting, waives such notice, and
such attendance or waiver shall be deemed equivalent to
notice.
ARTICLE 11.
Miscellaneous.
Section 11.1. Fiscal Year. The fiscal year of the
Corporation shall be determined by the Board. In the absence
of any such determination the fiscal year of the Corporation
shall be the calendar year.
Section 11.2. Seal. The seal of the Corporation
shall be a device containing the name of the Corporation, the
year of its organization and the word "Seal". The corporate
seal maybe used by printing, engraving, lithographing, stamp-
ing or otherwise making, placing or affixing, or causing to be
printed, engraved, lithographed, stamped or otherwise made,
placed or affixed, upon any paper or document, by any process
whatsoever, an impression, facsimile or other reproduction of
the seal of the Corporation.
ARTICLE 12.
Amendments.
Section 12.1. These By-laws may be altered, amended
or repealed, and new by-laws adopted, by the Board, but by-
laws made by the Board may be repealed or changed, and new by-
laws made, by the stockholders, and the stockholders may pre-
scribe that any by-laws made by them shall not be altered,
amended or repealed by the Board.
Dated: November 2, 1995
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