Registration Statement No. 33-43523
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SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
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FORM S-3
POST-EFFECTIVE AMENDMENT NO. 1
TO
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
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PECO ENERGY COMPANY
(formerly known as Philadelphia Electric Company)
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(Exact name of registrant as specified in its charter)
Pennsylvania 23-0970240
- ---------------------------------- ---------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
P. O. Box 8699
2301 Market Street, Philadelphia, PA 19101
(215) 841-4000
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(Address, including zip code, and telephone number,
including area code, of principal executive offices)
M. W. Rimerman Vice President - Finance and Treasurer
P. O. Box 8699
2301 Market Street, Philadelphia, PA 19101
(215) 841-4000
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(Name and address, including zip code, and telephone number,
including area code, of agent for service)
with copies to:
James W. Durham, Esq. Robert C. Gerlach, Esq.
Senior Vice President and General Counsel Ballard Spahr Andrews & Ingersoll
P. O. Box 8699 1735 Market Street, 51st Floor
Philadelphia, PA 19101 Philadelphia, PA 19103-7599
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P R O S P E C T U S
[LOGO]
PECO ENERGY
DIVIDEND REINVESTMENT AND STOCK PURCHASE PLAN
5,800,841 SHARES OF COMMON STOCK (WITHOUT PAR VALUE)
The Dividend Reinvestment and Stock Purchase Plan (Plan) provides common
and preferred shareholders of record with a convenient method of:
--automatically reinvesting their dividends in shares of common stock
of PECO Energy Company (Company);
--making cash investments of up to $50,000 per calendar year in shares
of common stock; and
--holding common and preferred stock for safekeeping, at no charge, by
First Chicago Trust Company of New York (First Chicago), as Custodian.
Employees or annuitants of the Company, including any of its subsidiaries,
may also participate by purchasing shares of common stock through payroll
or annuity deductions. Participation in the Plan by shareholders,
employees and annuitants is entirely optional.
The Company administers the Plan at its own expense. No brokerage fee or
commission is charged on the purchase of shares under the Plan but may be
charged on the sale of shares. See Questions 8, 22, 28, 32 and 35.
Shares may be purchased from the Company or purchased in open-market
transactions or a combination of both at the option of the Company. When
shares are purchased from the Company, the purchase price of the common
stock will be the closing New York Stock Exchange-Composite
(NYSE-Composite) price for the Company's common stock on the dividend
payment date in the case of reinvestment of dividends (see Questions 12, 13
and 14) and on the purchase date in the case of direct cash investment (see
Questions 17, 18 and 19). When shares are purchased in open-market
transactions, the purchase price of common stock will be the weighted
average price paid by an independent agent of the Company.
IT IS SUGGESTED THAT THIS PROSPECTUS BE RETAINED FOR FUTURE REFERENCE.
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. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
January 28, 1994
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STATEMENT OF AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934 and, in accordance therewith, files reports and other
information with the Securities and Exchange Commission (SEC). Information
as of particular dates concerning directors and executive officers, their
compensation, the principal holders of securities of the Company and any
material interest of such persons in transactions with the Company is
disclosed in proxy statements distributed to shareholders of the Company
and filed with the SEC. Such reports, proxy statements and other
information can be inspected and copies obtained at the Public Reference
Section of the SEC at 450 Fifth Street, N.W., Washington, DC 20549, and at
the SEC's regional offices at 500 West Madison Street, Chicago, Illinois
60661-2511 and 7 World Trade Center, New York, New York 10048, and copies
of such material can be obtained by mail from the Public Reference Section
of the SEC at 450 Fifth Street, N.W., Washington, DC 20549 at prescribed
rates. Securities of the Company are listed on the New York and
Philadelphia Stock Exchanges, where reports, proxy material and other
information concerning the Company may be inspected.
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INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed with the SEC pursuant to Section 13 of the
Securities Exchange Act of 1934 by the Company (File No. 1-1401) are
incorporated herein by reference:
1. the Company's Annual Report on Form 10-K for the year ended
December 31, 1992;
2. the Company's Quarterly Reports on Form 10-Q for the quarters ended
March 31, 1993, as amended by Form 8 filed May 18, 1993; June 30,
1993, and September 30, 1993; and
3. the Company's Current Reports on Form 8-K dated February 19, 1993;
May 12, 1993; June 9, 1993; June 11, 1993; June 12, 1993; and
December 28, 1993.
Each document filed subsequent to the date of this Prospectus pursuant to
Section 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934
prior to the termination of the offering shall be deemed to be incorporated
by reference in this Prospectus and shall be a part hereof from the date of
filing of such document.
THE COMPANY UNDERTAKES TO PROVIDE WITHOUT CHARGE TO EACH PERSON TO WHOM
THIS PROSPECTUS IS DELIVERED, INCLUDING ANY BENEFICIAL OWNER, UPON SUCH
PERSON'S WRITTEN OR ORAL REQUEST, A COPY OF ANY OR ALL OF THE DOCUMENTS
DESCRIBED ABOVE UNDER "INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE,"
OTHER THAN EXHIBITS TO SUCH DOCUMENTS. SUCH REQUESTS SHOULD BE DIRECTED
TO: PECO ENERGY COMPANY, FINANCIAL DIVISION, S21-1, P.O. BOX 8699,
PHILADELPHIA, PA 19101, (215) 841-5741.
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THE COMPANY
The Company was incorporated in Pennsylvania in 1929 and is an operating
utility which provides electric and gas service to the public in
southeastern Pennsylvania. Two subsidiaries own, and a third subsidiary
operates, the Conowingo Hydro-Electric Project (Conowingo Project), and one
distribution subsidiary provides electric service to the public in certain
areas of northeastern Maryland adjacent to the Conowingo Project.
The total area served by the Company and its subsidiaries covers 2,475
square miles. Electric service is supplied in an area of 2,340 square
miles with a population of about 3,700,000, including 1,600,000 in the City
of Philadelphia. Approximately 95% of the electric service area and 62% of
retail kilowatthour sales are in the suburbs around Philadelphia and in
northeastern Maryland, and 5% of the service area and 38% of such sales are
in the City of Philadelphia. Natural gas service is supplied in a
1,475-square-mile area of southeastern Pennsylvania adjacent to
Philadelphia with a population of 1,900,000. The Company and its
subsidiaries hold franchises to the extent necessary to operate in the
areas served.
The Company's principal executive offices are located at 2301 Market
Street, Philadelphia, Pennsylvania. Its mailing address is P.O. Box 8699,
Philadelphia, PA 19101, and its telephone number is (215) 841-4000.
DESCRIPTION OF DIVIDEND REINVESTMENT AND STOCK PURCHASE PLAN
The following questions and answers describe the Plan. A copy of the Plan
has been filed as an exhibit to the registration statement of which this
Prospectus is a part.
PURPOSE
1. WHAT IS THE PURPOSE OF THE PLAN?
The purpose of the Plan is to give holders of the Company's common and
preferred stock a convenient method of purchasing additional shares of
the Company's common stock through the reinvestment of dividends; to
encourage the purchase of the Company's common stock without payment of
any brokerage commission, service charge or other expense; and to
encourage employee ownership of the Company's common stock. To the
extent such shares are purchased from the Company, it will receive
additional funds for general corporate purposes. The Company does not
contribute to the purchase of shares under the Plan, but pays all
expenses associated with such purchases. See Questions 8 and 28.
ELIGIBILITY
2. WHO IS ELIGIBLE TO PARTICIPATE IN THE PLAN?
Shareholders. All holders of record of the Company's common and
preferred stock who have elected to participate in the Plan will be
Participants.
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Employees. All regular employees, officers and directors of the
Company or any of its wholly owned subsidiaries (employees), as well as
former employees receiving annuities (annuitants), who have elected to
participate in the Plan will be Participants.
Except as noted in Question 8, a beneficial owner of the Company's
stock whose shares are registered in other than the individual's own
name (such as in the name of a bank or broker) must have those shares
transferred to his own name before the individual can participate.
AUTHORIZATION AND CUSTODY
3. WHO ADMINISTERS AND INTERPRETS THE PLAN?
The Company has the responsibility of administering and interpreting
the Plan. The Company has appointed First Chicago to keep the records,
distribute statements of account and perform other duties relating to
the Plan. The Company has the authority to interpret the Plan, to
prescribe, amend and rescind rules and regulations relating to it, and
to make all other determinations deemed necessary or advisable in
administering the Plan, including those necessary to prevent any abuse.
No brokerage fees are charged in connection with the reinvestment of
dividends, direct cash investments, payroll deduction purchases, or
annuity deduction purchases, and the Company absorbs all administrative
expenses of the Plan. However, charges will be incurred by a
Participant upon the sale of shares and certain fees may be charged to
a Participant participating through brokers. See Questions 8, 22, 28,
32 and 35.
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| FOR INFORMATION ABOUT THE PLAN |
| |
| Call First Chicago toll free: |
| |
| 1-800-626-8729 |
| |
| Outside the continental United States call collect (201) 222-4862 |
| |
| or |
| |
| Write to: First Chicago Trust Company of New York |
| PECO Energy Company Plan |
| P.O. Box 2598 |
| Jersey City, NJ 07303-2598 |
| |
| All correspondence concerning the Plan should refer to |
| PECO Energy Company. |
| |
| DIRECT CASH INVESTMENTS OF CHECKS OR MONEY ORDERS PAYABLE TO |
| "FIRST CHICAGO-PECO ENERGY" IN U.S. DOLLARS SHOULD BE MAILED TO: |
| FIRST CHICAGO TRUST COMPANY OF NEW YORK, PECO ENERGY COMPANY PLAN, |
| P.O. BOX 13531, NEWARK, NJ 07188-0001. |
| |
| |
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4. WHO IS THE CUSTODIAN FOR THE PLAN?
First Chicago also acts as Custodian under the Plan for amounts
received under automatic dividend reinvestment, direct cash investment,
payroll deduction or annuity deduction. The Custodian also holds any
stock certificates for safekeeping upon the request of a Participant.
FEATURES
5. WHAT ARE THE FEATURES OF THE PLAN?
Automatic Dividend Reinvestment--The Plan permits automatic
reinvestment of dividends on the Company's common or preferred stock,
or both. Shares purchased through automatic dividend reinvestment will
be held by the Custodian and dividends on such shares will be
reinvested automatically unless otherwise directed. In addition,
shares purchased through direct cash investment, payroll deduction or
annuity deduction will be subject to automatic dividend reinvestment,
unless otherwise directed. Once commenced, automatic dividend
reinvestment will continue unless the Participant elects to have shares
excluded from automatic dividend reinvestment or the Plan is
terminated. A Participant may elect automatic dividend reinvestment by
sending to First Chicago an Authorization Form authorizing automatic
dividend reinvestment. See Question 9. A Participant owning common
stock may elect automatic dividend reinvestment on some or all shares
of common stock. A Participant owning preferred stock may elect
automatic dividend reinvestment only on all shares of preferred stock.
Direct Cash Investment--Whether or not participating in automatic
dividend reinvestment, a Participant may invest any amount up to a
maximum of $50,000 per calendar year in the Company's common stock
under the Plan. Shares purchased through direct cash investment will
be held by the Custodian and dividends on such shares will be
reinvested automatically unless the Participant elects to have some or
all of the shares in the Participant's account excluded from automatic
dividend reinvestment.
Payroll or Annuity Deduction--Whether or not participating in the other
features of the Plan, a Participant who is an employee or annuitant may
also invest in the Company's common stock through payroll or annuity
deductions under the Plan. The amount of payroll or annuity deductions
may be limited by the Company. Shares purchased through payroll or
annuity deductions will be held by the Custodian and dividends on such
shares will be reinvested automatically unless the employee or
annuitant elects to have shares excluded from automatic dividend
reinvestment. An employee or annuitant may elect payroll or annuity
deduction by sending to the Company an Authorization Form authorizing
the Company to deduct the amount indicated on a periodic basis
consistent with the individual's usual pay or annuity period.
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Custodial Service--A Participant may have certificates for shares of
the Company's common or preferred stock held by the Custodian for
safekeeping at no charge. Certificates so deposited will be held in
the name of the Custodian or its nominee. Upon written request of the
Participant, the Custodian will deliver a certificate for shares to the
Participant or will sell any or all of the shares held in custody. See
Questions 29 and 32. Dividends on shares held by the Custodian for
safekeeping will be reinvested automatically unless the Participant
elects otherwise. See discussion of automatic dividend reinvestment in
the first paragraph of this Question 5.
AUTOMATIC DIVIDEND REINVESTMENT
6. HOW DOES AN ELIGIBLE SHAREHOLDER PARTICIPATE?
Except as noted in Question 8, an eligible shareholder may elect
automatic dividend reinvestment by completing and signing an
Authorization Form and returning it to First Chicago. A postage
prepaid envelope is provided with the Authorization Form for this
purpose.
7. WHEN MAY A SHAREHOLDER BEGIN TO PARTICIPATE?
Participation may be elected at any time. Dividends on all shares
participating in automatic dividend reinvestment (participating shares)
will be reinvested as of the next dividend payment date after which
First Chicago receives the Authorization Form, provided the form is
received before the record date for that dividend payment. Otherwise,
reinvestment will begin as of the following dividend payment date.
Traditionally, common stock dividends declared by the Board of
Directors have been paid on the last business days of March, June and
September and in late December. Preferred stock dividends are payable
on the first days of February, May, August and November. The record
date normally precedes the dividend payment date by about a month.
8. MAY SHAREHOLDERS PARTICIPATE THROUGH BROKERS AND OTHER FINANCIAL
INSTITUTIONS?
Yes, in certain cases described below.
The Company in the past has entered into agreements with certain
brokers and other financial institutions holding shares in custody
accounts permitting the beneficial owners of such shares to participate
in the automatic dividend reinvestment feature (but not the direct cash
investment feature) of the Plan. The Company may enter into additional
such agreements in the future. Participation in the Plan through
custody accounts may involve additional conditions and requirements for
establishing participation or for withdrawing from such participation.
Brokers and other financial institutions offering this service to their
custody accounts may charge for such service upon reinvestment, which
charge is not imposed on Participants participating directly in the Plan.
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The agreements with brokers and other financial institutions with
respect to participation of custody accounts may be terminated at
any time.
9. WHAT IS AN AUTHORIZATION FORM AND HOW IS ONE OBTAINED?
An Authorization Form is the enrollment form for the Plan. By checking
the appropriate box, the Participant may direct First Chicago to
reinvest dividends and to invest cash. In the case of a Participant
who is an employee or annuitant, the Participant may direct the Company
to invest payroll or annuity deductions in additional shares of common
stock. All dividends on shares purchased through reinvestment of
dividends are automatically reinvested in shares of the Company's
common stock unless the Participant elects to have those shares
excluded from automatic dividend reinvestment or unless the Plan is
terminated. Shareholders of the Company may obtain an Authorization
Form at any time from First Chicago.
Employees may obtain an Authorization Form at any time from their
employing officer. Annuitants may obtain an Authorization Form at any
time from PECO Energy Company, Benefits Division, 2300 Market Street,
2nd Floor, Philadelphia, PA 19103 or by telephoning the Benefits
Division at (215) 841-4539.
10. MAY DIVIDENDS ON SHARES OF THE COMPANY'S STOCK ACQUIRED FROM A
SOURCE OUTSIDE THE PLAN BE REINVESTED AUTOMATICALLY?
Yes. If a Participant elects to have the dividends on all shares
reinvested, those shares that are registered in the exact same name as
the name in which the automatic dividend reinvestment account is
maintained will be reinvested. If the additional shares are registered
in another name, a new Authorization Form must be returned to First
Chicago in order to include them as participating shares. If a
Participant elects partial reinvestment, only the dividends on the
shares of common stock specifically requested to be reinvested will be
reinvested regardless of the acquisition of additional stock from an
outside source.
11. WHAT IS THE SOURCE OF SHARES PURCHASED UNDER THE PLAN?
Shares purchased under the Plan will be purchased, at the Company's
sole discretion, either directly from the Company or in open-market
transactions by an independent agent of the Company or a combination of
both. Open-market purchases may be made on any securities exchange
where such shares are traded, or by negotiated transactions and may be
subject to such terms with respect to price, delivery, and other terms
as such independent agent may agree to. Neither the Company nor any
Participant shall have any authority or power to direct the time or
price at which shares may be purchased, or the selection of the broker
or dealer through or from whom purchases will be made.
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12. WHEN WILL SHARES BE PURCHASED?
When shares are purchased from the Company, purchases will be made on
regularly scheduled dividend payment dates.
When shares are purchased in open-market transactions, shares will be
purchased by an independent agent beginning on dividend payment dates.
Purchases will be completed as soon as practicable, but in no event
later than 30 days after dividend payment dates, except where
completion at a later date is necessary or advisable under any
applicable securities laws.
13. AT WHAT PRICE WILL PURCHASES BE MADE?
When shares are purchased from the Company, the purchase price will be
the closing NYSE-Composite price for the Company's common stock on the
dividend payment date. If the New York Stock Exchange is closed on the
dividend payment date, the purchase price will be determined on the
next trading day.
When shares are purchased in open-market transactions, the purchase
price will be the weighted average price paid by an independent agent
to obtain all such shares.
14. HOW MANY SHARES OF COMMON STOCK WILL BE PURCHASED?
The Participant's account will be credited, as of the dividend payment
date, with the number of whole and fractional shares, computed to three
decimal places, which equal the amount of the dividends paid on the
Participant's participating shares divided by the applicable purchase
price.
15. MAY A PARTICIPANT CHANGE HIS REINVESTMENT OPTION UNDER THE PLAN?
Yes. A Participant may change his automatic dividend reinvestment
option at any time simply by signing and returning a new Authorization
Form to First Chicago. An Authorization Form may be obtained at any
time. Any change in the automatic dividend reinvestment must be
received before the record date in order to be effective as of the next
dividend payment date. See Question 7.
DIRECT CASH INVESTMENT
16. WHAT IS DIRECT CASH INVESTMENT?
All Participants have the option to invest any amount up to a maximum
of $50,000 per calendar year in the Company's common stock, whether
or not they elect to have dividends reinvested under the Plan. A
Participant who elects to take advantage of direct cash investment only
and does not wish to have dividends on those shares reinvested
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must so specify. There is no obligation to make any direct cash
investment and the same amount of money need not be invested each time
a direct cash investment is made.
17. HOW AND WHEN WILL DIRECT CASH INVESTMENTS BE MADE?
Direct cash investments are made by sending a check or money order
payable to "First Chicago--PECO Energy" with the completed tear-off
portion of the periodic account statement to First Chicago Trust
Company of New York, PECO Energy Company Plan, P.O. Box 13531, Newark,
NJ 07188-0001.
When shares are purchased from the Company, First Chicago will apply
any direct cash investment received from a Participant before a
purchase date to purchase whole and fractional shares on such purchase
date. When shares are purchased in open-market transactions, shares
will be purchased beginning on such purchase date. Purchases will be
completed as soon as practicable, but in no event later than 30 days
after such purchase date, except where completion at a later date is
necessary or advisable under any applicable securities laws. The
purchase dates under the Plan are the common stock dividend payment
dates (see Question 7 for approximate dates) and the first business
days of February, March, May, June, August, September, November and
December.
Brokers or nominees participating in automatic dividend reinvestment on
behalf of beneficial owners cannot utilize the direct cash investment
provision of the Plan. Therefore, if shares of the Company's stock are
held by a broker or nominee and the beneficial owner of such shares
wishes to participate in the direct cash investment feature of the
Plan, such beneficial owner must become a shareholder of record by
having all or a part of such shares transferred to such owner's name.
18. AT WHAT PRICE WILL DIRECT CASH INVESTMENTS BE MADE?
When shares are purchased from the Company, the purchase price will be
the closing NYSE-Composite price for the Company's common stock on the
purchase date. If the New York Stock Exchange is closed on the
purchase date, the purchase price will be determined on the next
trading day.
When shares are purchased in open-market transactions, the purchase
price will be the weighted average price paid by an independent agent
to obtain all such shares.
19. HOW MANY SHARES OF COMMON STOCK WILL BE PURCHASED?
The Participant's account will be credited, as of the purchase date,
with the number of whole and fractional shares, computed to three
decimal places, which equal the amount of the direct cash investment
divided by the applicable purchase price.
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20. WILL INTEREST BE PAID ON DIRECT CASH INVESTMENTS RECEIVED PRIOR TO
THE PURCHASE DATE?
No. For that reason, the Company urges Participants to mail their
investments so that they are received by First Chicago prior to, but as
close as possible to, a purchase date. Of course, sufficient time
should be allowed for the payment to reach First Chicago. Direct cash
investments received by First Chicago will be returned to a Participant
upon written request by such Participant, provided such request is
received by First Chicago at least 48 hours prior to the purchase date.
21. WHO HOLDS SHARES PURCHASED THROUGH DIRECT CASH INVESTMENT?
Shares purchased through direct cash investment will be held by the
Custodian and may be withdrawn by the Participant at any time. If the
request for delivery of certificates accompanies the direct cash
investment, a certificate for whole shares purchased will be delivered.
Any fractional share will be held by the Custodian, unless the
Participant requests that First Chicago sell the fractional share. The
certificate will be sent to the Participant as soon as practicable
after the purchase date.
22. CAN A PARTICIPANT PURCHASE A SPECIFIC NUMBER OF SHARES?
A Participant may combine the direct cash investment option with the
withdrawal feature to purchase a specific number of shares. To do
this, the Participant must complete the tear off portion of the
periodic account statement and return it to First Chicago with a check
or money order sufficient to purchase at least the desired number of
shares. At the same time, the Participant should enclose instructions
requesting (a) withdrawal of the desired number of shares from the
Custodian immediately after the purchase and (b) the sale of any whole
or fractional shares in excess of that number. The total amount of
cash received will be invested as of the purchase date following
receipt by First Chicago of the appropriate form, instructions and
cash. Thus, the number of shares purchased may be greater than the
specific number desired. In such case, a certificate for the shares
requested will be issued and any remaining whole and fractional shares
will be sold as soon as practicable and the proceeds from the sale, net
of any brokerage fees and expenses (see Question 28), will be sent to
the Participant. For information concerning the income tax
consequences of a sale of shares, see Question 43.
If the number of shares purchased is less than the specific number
desired, the Participant will be notified via his periodic account
statement and additional shares necessary to reach the specified amount
may be purchased as of the next purchase date by following the same
procedure.
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DIVIDENDS ON FRACTIONAL SHARES
23. WILL A PARTICIPANT BE CREDITED WITH DIVIDENDS ON FRACTIONAL SHARES?
Yes. Dividends on fractional shares will be credited to a
Participant's account and shown on periodic account statements.
PAYROLL OR ANNUITY DEDUCTIONS
24. WHAT IS THE PAYROLL OR ANNUITY DEDUCTION OPTION?
All Participants who are employees or annuitants may purchase
additional shares of the Company's common stock through payroll or
annuity deductions. The purchase dates and prices for shares purchased
through payroll or annuity deductions will be determined in the same
manner as the purchase dates and prices for shares purchased through
direct cash investment. See Questions 16 through 22. The amount of
payroll deductions or annuity deductions may be limited by the Company.
25. HOW DOES AN EMPLOYEE OR ANNUITANT PARTICIPATE IN PAYROLL OR ANNUITY
DEDUCTIONS?
An employee or annuitant may elect to purchase shares of the Company's
common stock through payroll or annuity deductions by sending to the
Company an Authorization Form authorizing the Company to deduct the
amount indicated on a periodic basis consistent with the employee's or
annuitant's usual pay or annuity period.
An employee or annuitant may change the amount deducted or may elect to
discontinue payroll or annuity deductions at any time by sending to the
Company written notice of such change. Such change will be effective
as soon as practicable after receipt by the Company.
26. WHO HOLDS SHARES PURCHASED THROUGH PAYROLL OR ANNUITY DEDUCTIONS?
Shares purchased through payroll or annuity deductions will be held by
the Custodian and dividends on such shares will be reinvested
automatically unless the employee or annuitant elects to have shares
excluded from automatic dividend reinvestment.
CUSTODIAL SERVICE
27. HOW CAN A PARTICIPANT HAVE STOCK CERTIFICATES DEPOSITED WITH THE
CUSTODIAN FOR SAFE-KEEPING?
A Participant may have certificates for shares of the Company's common
or preferred stock deposited with the Custodian for safekeeping, free
of charge. Certificates so deposited will be held in the name of the
Custodian or its nominee.
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Certificates for safekeeping should be sent with a completed
Certificate Deposit Form by registered mail return receipt requested
and properly insured to First Chicago Trust Company of New York, PECO
Energy Company Plan, P.O. Box 2598, Jersey City, NJ 07303-2598. These
certificates should not be endorsed.
COSTS
28. WHAT ARE THE COSTS TO A PARTICIPANT IN THE PLAN?
A Participant will incur no brokerage commissions or service charges
for purchases made under the Plan. Any brokerage commissions in
connection with a sale by First Chicago of all or a part of the shares
held for a Participant under the Plan will be charged to such
Participant. In addition, First Chicago will charge Participants a
service fee of $2.00 only if the proceeds of any sale of full or
fractional shares from dividend reinvestment accounts are at least
$15.00. This charge will not be applicable to any sale of a fractional
share after the issuance of stock certificates for all whole shares on
termination of participation in the Plan. Participants will receive
proceeds from such sales, net of any applicable charges, brokerage fees
and expenses. See Questions 40 through 48 for information relating to
income tax consequences. All costs of administration of the Plan and
brokerage commissions or service charges incurred in connection with
the purchase of the shares will be paid by the Company.
CERTIFICATES; TRANSFERS; WITHDRAWAL OF SHARES; SALE OF SHARES
29. WHEN WILL A CERTIFICATE BE ISSUED FOR SHARES OF COMMON STOCK
PURCHASED OR DEPOSITED UNDER THE PLAN?
Certificates for shares held under the Plan will be issued to a
Participant only upon written request to the Custodian. Shares
purchased through automatic dividend reinvestment, direct cash
investment, payroll deduction or annuity deduction or shares deposited
for safekeeping will be held in the name of the Custodian or its
nominee until the Participant gives First Chicago written instructions
to deliver certificates for whole shares held under the Plan. The
Participant may obtain a certificate for any number of whole shares
held by the Custodian. Certificates will be issued as soon as
practicable after First Chicago receives a written request from the
Participant.
30. IN WHOSE NAME WILL CERTIFICATES BE REGISTERED WHEN ISSUED?
Unless the Participant otherwise directs, certificates will be issued
in the name in which the account is maintained. A certificate may be
issued in a name other than that in which the account is maintained, if
First Chicago receives a signed written request and a stock power with
all signatures guaranteed by an eligible guarantor institution (banks,
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stockbrokers, savings and loan associations and credit unions) with
membership in an approved signature guarantee medallion program
pursuant to SEC regulations.
31. CAN SHARES HELD BY THE CUSTODIAN BE PLEDGED AS COLLATERAL?
No. A Participant may not in any manner create a lien on any shares or
funds held by the Custodian under the Plan. This means that an account
may not be assigned or used as security for a loan. If shares held
under the Plan are to be used for collateral, certificates for such
shares must first be issued to the Participant. See Question 29.
32. CAN A PARTICIPANT SELL SHARES HELD UNDER THE PLAN?
Yes. If a Participant requests that all or part of his shares held by
the Custodian under the Plan be sold, the shares will be sold as soon
as practicable after the receipt by First Chicago of properly
documented instructions which must bear the Participant's signature.
No shares, however, will be sold during the five-business-day period
preceding and ending on the record date for the payment of dividends on
such shares. If the account is registered in multiple names, the
request must bear the signatures of all of the persons in whose name
the account is maintained. If the check for the proceeds from the sale
is to be issued in another person's name, the Participant must complete
a stock power with the signature of each owner guaranteed by an
eligible guarantor institution (banks, stockbrokers, savings and loan
associations and credit unions) with membership in an approved
signature guarantee medallion program pursuant to SEC regulations. A
Participant wishing to sell shares should allow sufficient time for the
mail to reach First Chicago and for the processing of the sale.
Neither the Company nor First Chicago can guarantee any sale price or
commission cost. Proceeds from the sale, net of any brokerage fees and
expenses (see Question 28), will be sent to the Participant as soon as
practicable after the sale. In order to remain in the Plan, however, a
Participant must leave at least a fraction of a share in the Plan.
33. WHEN A PARTICIPANT TRANSFERS OR SELLS NON-PARTICIPATING SHARES, WILL
DIVIDENDS ON PARTICIPATING SHARES CONTINUE TO BE REINVESTED?
Yes. All dividends on participating shares will continue to be
reinvested until the Participant requests that such shares be excluded
from automatic dividend reinvestment. Direct cash investments may also
continue to be made.
34. CAN A PARTICIPANT TRANSFER SOME PARTICIPATING SHARES AND STILL
REMAIN IN THE PLAN?
Yes, as long as the Participant retains at least a fraction of a share
in the Plan.
11
<PAGE>
COMPLETE WITHDRAWAL FROM THE PLAN
35. HOW DOES A PARTICIPANT WITHDRAW FROM THE PLAN?
A Participant may close his account at any time by giving written
notice to First Chicago Trust Company of New York, PECO Energy Company
Plan, P.O. Box 2598, Jersey City, NJ 07303-2598. As soon as
practicable after receipt of such written notice by First Chicago,
First Chicago will issue a stock certificate for all whole shares
credited to the Participant's Plan account and will return any
uninvested dividends in the account. In addition, the Custodian will
sell any fractional share for cash at the current market price and
return the proceeds net of any brokerage fees and expenses. See
Question 28. Shares credited to a Participant's account may also be
sold, if so requested in writing. See Questions 32 and 43.
36. CAN A PARTICIPANT REENTER THE PLAN AFTER HE HAS TERMINATED HIS
PARTICIPATION?
Yes. Any shareholder, employee or annuitant may rejoin at any time,
but he must submit a new Authorization Form.
37. CAN AN EMPLOYEE CONTINUE TO PARTICIPATE IN THE PLAN UPON RETIREMENT?
Continued participation is automatic for dividend reinvestment.
Retired employees who receive an annuity from the Company must submit a
new Authorization Form if they wish to purchase shares of the Company's
common stock through annuity deductions.
38. CAN AN EMPLOYEE PARTICIPATE IN THE PLAN IF HIS EMPLOYMENT IS
TERMINATED OTHER THAN THROUGH RETIREMENT?
Yes. Although an employee whose employment is terminated other than
through retirement is no longer eligible for payroll deduction, he may
continue to participate in the Plan.
39. WHAT HAPPENS TO A PARTICIPANT'S SHARES UPON HIS DEATH?
Upon the death of a Participant, First Chicago will follow the
instructions of the decedent's personal representative.
INCOME TAX CONSEQUENCES OF PARTICIPATION IN THE PLAN
The federal income tax consequences of participation in the Plan, which
is not a qualified retirement plan subject to Section 401(a) of the
Internal Revenue Code, are set forth generally below. INDIVIDUALS ARE
URGED TO CONSULT THEIR TAX ADVISERS REGARDING SPECIFIC FEDERAL, STATE
AND LOCAL INCOME TAX CONSEQUENCES OF PARTICIPATION IN THE PLAN.
12
<PAGE>
40. WHAT IS THE TAX TREATMENT OF DIVIDENDS RECEIVED BY A PARTICIPANT?
In the case of shares acquired from the Company with reinvested
dividends, a Participant will be treated for federal income tax
purposes as having received, on each dividend payment date, the full
amount of dividends reinvested in shares as cash dividends even though
that amount is not actually received in cash, but instead is applied to
the purchase of shares. In the case of shares purchased in open-market
transactions with reinvested dividends, a Participant, in addition to
being treated as having received a dividend in an amount equal to the
cash dividend paid, will be treated as having received a dividend in
the amount of the allocable brokerage fees paid by the Company. The
amount of such dividends will be shown on the Form 1099-DIV furnished
annually to the Participant and the Internal Revenue Service (IRS).
The Form 1099-DIV and periodic account statements sent to each
Participant should be retained as a source of information for filing
future income tax returns.
41. ARE PARTICIPANTS ENTITLED TO EXCLUDE OR DEDUCT FROM GROSS INCOME
AMOUNTS INVESTED IN SHARES THROUGH PAYROLL OR ANNUITY DEDUCTION OR
CASH INVESTMENT?
Participants are not entitled to exclude or deduct from gross income
any compensation, annuities or cash invested in shares under the Plan.
42. WHAT IS THE INCOME TAX BASIS OF SHARES PURCHASED UNDER THE PLAN
OTHER THAN THROUGH AUTOMATIC DIVIDEND REINVESTMENT?
The income tax basis of shares purchased from the Company under the
Plan will be the applicable purchase price. The income tax basis of
shares purchased in open-market transactions will be the same as in the
preceding sentence, increased by the allocable brokerage fees paid by
the Company.
43. WHAT IS THE TAX TREATMENT OF CASH RECEIVED BY A PARTICIPANT UPON THE
SALE OF SHARES SOLD UNDER THE PLAN, OR AS A RESULT OF WITHDRAWAL FROM OR
TERMINATION OF THE PLAN?
A Participant who receives cash upon the sale of any whole or
fractional shares held in his Plan account will recognize either a
short-term or long-term capital gain or loss, depending on the
particular circumstances, such as the tax basis of the shares (adjusted
to reflect any return of capital dividends received thereon) and the
period of time the shares were held.
If a Participant who is selling some shares wishes to identify, for tax
purposes, the spe-cific shares to be sold, or wishes to sell shares at
a specific price, the Participant must first request that certificates
be issued to him by First Chicago as described in Question 29 and then
make the desired arrangements with a broker. In order to identify, for
13
<PAGE>
tax purposes, the specific shares to be sold, the Participant must also
comply with certain requirements under federal income tax regulations.
Individuals are urged to consult with their tax advisers.
Federal law requires First Chicago to notify the IRS of certain sales
of stock made under the Plan during the year. Such sales will be
reported on a Form 1099-B furnished to the Participant and the IRS.
44. WILL A PARTICIPANT RECOGNIZE TAXABLE INCOME WHEN CERTIFICATES ARE
RECEIVED FOR SHARES CREDITED TO THE PARTICIPANT'S PLAN ACCOUNT?
A Participant will not recognize any taxable income for federal income
tax purposes when certificates are received for whole shares credited
to his Plan account, either upon request for such certificates or upon
withdrawal from or termination of the Plan.
45. WHAT TAX REPORTING REQUIREMENTS ARE IMPOSED ON A PARTICIPANT WHEN
SHARES PURCHASED UNDER THE PLAN ARE EVENTUALLY SOLD?
A Participant must report any gain or loss resulting from the sale when
he files his annual federal income tax return.
46. ARE STATE AND LOCAL INCOME TAXES IMPOSED ON DIVIDENDS AND GAINS FROM
THE SALE OF SHARES?
State and local tax laws may require payment of income tax on dividends
(including reinvested dividends) and on gains from the sale of shares.
Individuals are urged to consult their tax advisers regarding specific
state and local income tax consequences of participation in the Plan.
47. WHEN WILL A PARTICIPANT BE SUBJECT TO 31% BACKUP WITHHOLDING?
Federal law requires First Chicago to withhold 31% from the amount of
dividends and the proceeds of any sale of shares for a Participant if:
(1) that Participant fails to certify to First Chicago that the
Participant is not subject to backup withholding, (2) that Participant
fails to certify that the taxpayer identification number provided is
correct or (3) the IRS notifies the Company that the Participant is
subject to backup withholding. The withheld amounts will be deducted
from the amount of dividends and the remaining amount will be
reinvested. The withheld amounts also will be deducted from the
proceeds of any sale of shares and the remaining amount will be sent to
the Participant.
14
<PAGE>
48. HOW ARE UNITED STATES INCOME TAX WITHHOLDING PROVISIONS APPLIED TO
FOREIGN SHAREHOLDERS?
In the case of those foreign shareholders whose dividends are subject
to United States income tax withholding, the amount of tax to be
withheld will be deducted from the amount of dividends and the
remaining amount of dividends will be reinvested. In the case of those
foreign shareholders whose sale proceeds are subject to withholding,
the amount of tax to be withheld will be deducted from the proceeds of
the sale of shares.
OTHER INFORMATION
49. WHAT REPORTS WILL BE SENT TO A PARTICIPANT?
As soon as practicable after every purchase date on which there is
activity in his account, a Participant will receive a periodic account
statement. A Participant will also receive copies of the Company's
annual and quarterly reports, proxy statements and proxies as well as
other correspondence generally sent to shareholders.
50. WHAT IS THE EFFECT ON A PARTICIPANT OF A RIGHTS OFFERING, STOCK
DIVIDEND OR STOCK SPLIT?
If the Company sells additional common stock through a rights offering,
the rights will be forwarded to a Participant for disposition.
Likewise, any stock dividends of common stock or shares resulting from
a stock split or reclassification of common stock will be credited to
the account of the Participant in accordance with stock ownership.
51. WHAT ARE THE RESPONSIBILITIES OF THE COMPANY AND FIRST CHICAGO UNDER
THE PLAN?
Neither the Company nor First Chicago will be liable for any act done
in good faith or for any good faith omission to act, including, without
limitation, any claim of liability arising out of failure to terminate
a Participant's account upon such Participant's death, the prices at
which shares are purchased or sold for the Participant's account, the
times when purchases or sales are made, or fluctuations in the market
value of the Company's common stock.
Each Participant should recognize that neither the Company nor First
Chicago can provide any assurance of a profit or protection against
loss on any shares purchased under the Plan.
15
<PAGE>
52. CAN THE PLAN BE CHANGED OR DISCONTINUED?
The Company reserves the right to suspend, terminate or modify the Plan
at any time. The Participant will be notified of any such suspension,
termination or material modification.
53. HOW WILL PLAN SHARES BE VOTED AT THE ANNUAL MEETING OF SHAREHOLDERS?
For each meeting of shareholders, a Participant will receive proxy
material that will enable the Participant to vote both the shares
registered in the Participant's name directly and/or whole or
fractional shares credited to the Participant's Plan account. Such
proxy will be voted as indicated by the Participant on the proxy. If
the proxy card is not returned or if it is returned unsigned by the
registered owner, none of the Participant's shares will be voted. If a
Participant elects, he may vote his shares, including all Plan shares
held for his account under the Plan, in person at the shareholders'
meeting.
USE OF PROCEEDS
The Company has no basis for estimating either the number of shares that
will ultimately be purchased from the Company under the Plan or the prices
which it will receive for such shares. When shares are purchased from the
Company, the net proceeds from such sales will be used for general
corporate purposes.
EXPERTS
The consolidated financial statements and schedules of the Company
incorporated by reference in this Prospectus have been audited by Coopers &
Lybrand, independent accountants, for the periods indicated in their
reports thereon which are included in the Annual Report on Form 10-K for
the year ended December 31, 1992. The consolidated financial statements
and schedules audited by Coopers & Lybrand have been incorporated herein by
reference in reliance on their reports given on their authority as experts
in accounting and auditing.
LEGAL OPINIONS
The validity of the common stock to be issued by the Company pursuant to
the Plan will be passed upon for the Company by Ballard Spahr Andrews &
Ingersoll, Philadelphia, Pennsylvania. In the opinion of Ballard Spahr
Andrews & Ingersoll, the shares of common stock of the Company offered
under the Plan are exempt from personal property taxes in Pennsylvania.
16
<PAGE>
[THIS PAGE INTENTIONALLY LEFT BLANK]
<PAGE>
===================================== ======================================
CONTENTS [LOGO]
PECO
Page ENERGY
----
Statement of Available
Information ................... i
Incorporation of Certain
Documents by Reference ........ i
The Company ..................... 1
Description of Dividend
Reinvestment and Stock
Purchase Plan ................. 1
Purpose ..................... 1
Eligibility ................. 1
Authorization and Custody ... 2
Features .................... 3
Automatic Dividend P R O S P E C T U S
Reinvestment .............. 4
Direct Cash Investment ...... 6
Dividends on Fractional
Shares .................... 9
Payroll or Annuity Deductions 9
Custodial Service ........... 9
Costs ....................... 10 DIVIDEND REINVESTMENT
Certificates; Transfers; AND STOCK PURCHASE PLAN
Withdrawal of Shares; Sale
of Shares ................. 10
Complete Withdrawal from
the Plan .................. 12
Income Tax Consequences of
Participation in the Plan.. 12
Other Information ........... 15
Use of Proceeds ................. 16 5,800,841 SHARES
Experts ......................... 16 COMMON STOCK
Legal Opinions .................. 16 (WITHOUT PAR VALUE)
===================================== ======================================
<PAGE>
PART II - INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 16. Exhibits
Exhibit
Number
-------
4-2(a) Articles of Amendment, dated February 8, 1993
24-1 Consent of Independent Accountants
24-2 Consent of Counsel
28 PECO Energy Company Dividend Reinvestment and Stock
Purchase Plan, as amended January 28, 1994.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant, PECO Energy Company (formerly known as PHILADELPHIA ELECTRIC
COMPANY), certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-3 and has duly caused this
registration statement or amendment to be signed on its behalf by the
undersigned, thereunto duly authorized in the City of Philadelphia,
Commonwealth of Pennsylvania, on the 28th day of January, 1994.
PECO Energy Company
By: /s/ J.F. Paquette, Jr.
-------------------------------
J. F. Paquette, Jr.
Chairman of the Board
Pursuant to the requirements of the Securities Act of 1933, this
registration statement or amendment has been signed by the following
persons in the capacities and on the date indicated.
Signature Title Date
- ---------------------- ----------------------------- ----------------
/s/ J.F. Paquette, Jr. Chairman of the Board January 28, 1994
- ---------------------- and Director
J. F. Paquette, Jr. (Principal Executive Officer)
/s/ C.A. McNeill, Jr. President and Director January 28, 1994
- ---------------------- (Principal Operating Officer)
C. A. McNeill, Jr.
/s/ W.L. Bardeen Senior Vice President-Finance January 28, 1994
- ---------------------- (Principal Financial and
W. L. Bardeen Accounting Officer)
This registration statement or amendment has also been signed by J.F.
Paquette, Jr., Attorney-in-Fact, on behalf of the following Directors on
the date indicated:
Susan W. Catherwood Robert D. Harrison
M. Walter D'Alessio Joseph C. Ladd
Richard G. Gilmore Edithe J. Levit
Richard H. Glanton Kinnaird R. McKee
James A. Hagen Joseph J. McLaughlin
Nelson G. Harris John M. Palms
Ronald Rubin
By: /s/ J.F. Paquette, Jr.
--------------------------------
J.F. Paquette, Jr. January 28, 1994
Attorney-in-Fact
Microfilm Number Filed with the Department of State on FEB 08 1993
-------- -----------
Entity Number 278411 /s/ Brenda K. Mitchell
-------- -------------------------------------------------
Secretary of the Commonwealth
ARTICLES OF AMENDMENT-DOMESTIC BUSINESS CORPORATION
DSCB:15-1915 (Rev 90)
In compliance with the requirements of 15 Pa.C.S. Section 1915 (relating
to articles of amendment), the undersigned business corporation, desiring to
amend its Articles, hereby states that:
1. The name of the corporation is: Philadelphia Electric Company
-------------------------------------------
---------------------------------------------------------------------------
2. The (a) address of this corporation's current registered office in this
Commonwealth or (b) name of its commercial registered office provider
and the county of venue is (the Department is hereby authorized to correct
the following information to conform to the records of the Department):
(a) 2301 Market Street Philadelphia PA 19101 Philadelphia
-----------------------------------------------------------------------
Number and Street City State Zip County
(b) c/o:
------------------------------------------------------------------
Name of Commercial Registered Office Provider County
For a corporation represented by a commercial registered office provider,
the county in (b) shall be deemed the county in which the corporation is
located for venue and official publication purposes.
May 3, 1909, P.L. 408. Acceptance of Act of
3. The statute by or under May 5, 1933, P.L. 364, as amended and
which it was incorporated is: supplemented, on 9/26/67
--------------------------------------------
4. The date of its incorporation is: 10/31/29
-----------------------------------------
5. (Check, and if appropriate complete, one of the following):
--- The amendment shall be effective upon filing these Articles of
Amendment in the Department of State.
X The amendment shall be effective on: January 1, 1994 at 12:00 A.M.
--- ----------------- -------------
Date Hour
6. (Check one of the following):
--- The amendment was adopted by the shareholders (or members) pursuant
to 15 Pa.C.S. Section 1914(a) and (b).
X The amendment was adopted by the board of directors pursuant to
--- 15 Pa.C.S. Section 1914(c).
7. (Check, and if appropriate complete, one of the following):
X The amendment adopted by the corporation, set forth in full, is
--- as follows:
RESOLVED, that effective January 1, 1994, ARTICLE I, of the AMENDED
AND RESTATED ARTICLES OF INCORPORATION is amended to read "The name
of the Corporation is: PECO ENERGY COMPANY", subject to the approval
of the shareholders at the Annual Meeting on April 14, 1994.
--- The amendment adopted by the corporation as set forth in full in
Exhibit A attached hereto and made a part hereof.
<PAGE>
DSCB:15-1915 (Rev 90)-2
8. (Check if the amendment restates the Articles):
--- The restated Articles of Incorporation supersede the original Articles
and all amendments thereto.
IN TESTIMONY WHEREOF, the undersigned corporation has caused these
Articles of Amendment to be signed by a duly authorized officer thereof
this 8th day of February, 1993.
--- -------- --
Philadelphia Electric Company
----------------------------------------------
(Name of Corporation)
BY: /s/ James W. Durham
------------------------------------------
(Signature)
TITLE: Senior Vice President & General Counsel
---------------------------------------
Exhibit 24-1
CONSENT OF INDEPENDENT ACCOUNTANTS
To The Board of Directors,
PECO Energy Company:
We consent to the incorporation by reference in the registration statement
of PECO Energy Company, formerly known as Philadelphia Electric Company
(Company), on Form S-3, with respect to the registration of 6,382,489
shares of common stock pursuant to the Company's Dividend Reinvestment and
Stock Purchase Plan (Registration No. 33-43523), of our reports dated
February 1, 1993, on our audits of the consolidated financial statements
and financial statement schedules of Philadelphia Electric Company and
Subsidiary Companies as of December 31, 1992 and 1991, and for each of the
three years in the period ended December 31, 1992, listed in Item 14 of the
1992 Annual Report of Philadelphia Electric Company on Form 10-K. We also
consent to the reference to our firm under the heading "Experts".
/S/ COOPERS & LYBRAND
--------------------------------------------
Coopers & Lybrand
Philadelphia, Pennsylvania
January 28, 1994
Exhibit 24-2
CONSENT OF BALLARD SPAHR ANDREWS & INGERSOLL
To The Board of Directors,
PECO Energy Company:
We hereby consent to all references to our firm included in or made
a part of the Registration Statement.
/S/ BALLARD SPAHR ANDREWS & INGERSOLL
------------------------------------------------
Ballard Spahr Andrews & Ingersoll
Philadelphia, Pennsylvania
January 28, 1994
EXHIBIT 28
PECO ENERGY COMPANY
DIVIDEND REINVESTMENT AND STOCK PURCHASE PLAN
ADOPTION OF AMENDED PLAN
I, M. W. Rimerman, Vice President-Finance and Treasurer, as
Administrator of the PECO Energy Company (formerly known as Philadelphia
Electric Company) Dividend Reinvestment and Stock Purchase Plan (the
"Plan"), adopt the copy of the Plan attached hereto as Exhibit A as the
amended Plan.
IN WITNESS WHEREOF, I have duly executed this Certificate this 28th day
of January, 1994.
PHILADELPHIA ELECTRIC COMPANY
/s/ M.W. Rimerman
---------------------------------------------
Vice President-Finance and
Treasurer
<PAGE>
PECO ENERGY COMPANY
DIVIDEND REINVESTMENT AND STOCK PURCHASE PLAN,
AS AMENDED JANUARY 28, 1994
1. PURPOSE
The purpose of the Dividend Reinvestment and Stock Purchase Plan (Plan)
is to give the holders of the Company's common and preferred stock a
convenient method of purchasing additional shares of the Company's common
stock through the reinvestment of dividends; to encourage the purchase of
the Company's common stock without payment of any brokerage commission,
service charge or other expense, and; to encourage employee ownership of
the Company's common stock.
2. ELIGIBILITY
A. SHAREHOLDERS. All holders of record of the Company's common and
preferred stock who have elected to participate in the Plan will be
Participants in the Plan.
B. EMPLOYEES. All regular employees, officers and directors of the
Company or any of its wholly owned subsidiaries (employees) and all former
employees receiving annuities (annuitants) who have elected to participate
in the Plan will be Participants in the Plan.
<PAGE>
The Plan is not available to annuitants' beneficiaries receiving
annuities under a contingent annuity option.
3. AUTOMATIC DIVIDEND REINVESTMENT
A. ELECTION TO PARTICIPATE. Any owner of record of the Company's
common stock may elect automatic dividend reinvestment on some or all
shares (participating shares) of his or her common stock at any time by
sending to the Company or its independent agent an Authorization Form
authorizing automatic dividend reinvestment. Any owner of record of the
Company's preferred stock may elect automatic dividend reinvestment only on
all shares of that owner's preferred stock. Participants who are employees
or annuitants may also elect automatic dividend reinvestment on shares of
the Company's stock held through such employee plans as the Company may
designate from time to time. A separate Authorization Form must be used
for each name in which an owner holds shares for those shares to be
included as participating shares. The Company may enter into agreements
with brokers and other financial institutions holding shares in custody
accounts permitting the beneficial owners of such shares to participate in
the automatic dividend reinvestment feature (but not the direct cash
investment
2
<PAGE>
option) of the Plan. The agreements with brokers and other
financial institutions with respect to participation of custody accounts
may be terminated at any time.
B. REINVESTMENT OF DIVIDENDS. Dividends on all participating shares
will be reinvested as of the next purchase date after receipt by the
Company or its independent agent of the Authorization Form, provided the
Form is received before the record date for the dividends to be invested.
The account of each Participant who has elected automatic dividend
reinvestment will be credited, as of the purchase date, with the number of
whole and fractional shares, computed to three decimal places, of common
stock purchased with the dividends paid on participating shares.
C. AUTOMATIC DIVIDEND REINVESTMENT. Shares purchased through automatic
dividend reinvestment will be held by the custodian and dividends on such
shares automatically will be reinvested unless the Participant elects to
have the shares excluded from automatic dividend reinvestment.
D. TERMINATION OF DIVIDEND REINVESTMENT. A Participant may elect to
exclude some or all shares from automatic dividend reinvestment at any time
by sending to the Company or its independent agent written notice of such
election. Such change will be effective as soon as practicable after
receipt by the Company or its independent agent of such written notice from
the Participant. Any
3
<PAGE>
change in the automatic dividend reinvestment option, however, must be
received before the record date in order to be effective as of the next
purchase date.
4. DIRECT CASH INVESTMENT
A. PURCHASE DATES AND PRICE. Any Participant may invest any amount up
to a maximum of $50,000 per calendar year in the Company's common stock
under the Plan. There is no obligation to make any cash investment and the
same amount of money need not be invested each time a cash investment is
made. The account of each Participant who makes a direct cash investment
will be credited, as of the nearest purchase date following receipt by the
Company or its independent agent of the funds, with the number of whole and
fractional shares, computed to three decimal places, of common stock
purchased with the direct cash investment.
B. MANNER OF PAYMENT. A direct cash investment may be made by sending
to the Company or its independent agent a check or money order payable to
PECO Energy Company, or such other person as the Company may, from time to
time, designate, with a completed cash investment portion of the periodic
account statement. Interest will not be paid on any amounts received.
C. AUTOMATIC DIVIDEND REINVESTMENT. Shares purchased through direct
cash investment will be held by the custodian and dividends on such shares
4
<PAGE>
will be reinvested automatically unless the Participant elects to have some
or all of the shares in the Participant's account excluded from automatic
dividend reinvestment.
5. PAYROLL OR ANNUITY DEDUCTIONS
A. ELECTION TO PARTICIPATE. A Participant who is an employee or
annuitant may elect to purchase shares of Company common stock through
payroll or annuity deduction by sending to the Company an Authorization
Form authorizing the Company to deduct the amount indicated on a periodic
basis consistent with the individual's usual pay or annuity period.
Deductions will commence as soon as practicable after the Authorization
Form is received by the Company.
B. AMOUNT OF DEDUCTIONS. Any limitations on the amount of payroll
deductions for employees or annuity deductions for annuitants will be
determined by the Company.
C. AUTOMATIC DIVIDEND REINVESTMENT. Shares purchased through payroll
or annuity deductions will be held by the custodian. Dividends on such
shares will be reinvested automatically unless the Participant elects to
have the shares excluded from automatic dividend reinvestment.
5
<PAGE>
D. PURCHASE DATE AND PRICES. The purchase dates and prices for shares
purchased through payroll or annuity deduction will be determined in the
same manner as the purchase dates and prices for shares purchased through
direct cash investment.
E. TERMINATION OF PAYROLL OR ANNUITY DEDUCTION. A Participant who is
an employee or annuitant may elect to discontinue payroll or annuity
deduction or change the amount deducted by sending to the Company written
notice of such election. Such change will be effective as soon as
practicable after the Company receives written notice from the Participant.
6. PURCHASES
A. SOURCE OF SHARES. Shares purchased pursuant to the Plan will be
purchased, at the Company's sole discretion, either directly from the
Company or in open-market transactions by an independent agent, or a
combination of both. Open-market purchases may be made on any securities
exchange where the Company's common stock is traded, or by negotiated
transactions. All shares delivered pursuant to the Plan will be fully paid
and nonassessable.
B. PURCHASE DATES. Dividends will be applied by the Company or its
independent agent as of the regularly scheduled dividend payment dates.
Direct
6
<PAGE>
cash investments will be applied by the Company or its independent
agent as of the regularly scheduled common stock dividend payment dates and
the first business day of February, March, May, June, August, September,
November and December following receipt of the direct cash investments.
C. PURCHASE PRICE. When shares are purchased from the Company, the
purchase price will be the closing NYSE-Composite price for the Company's
common stock on the applicable purchase date or, if the New York Stock
Exchange is closed on such date, on the next trading day.
When shares are purchased in open-market transactions, the purchase
price will be the weighted average price paid by the independent agent to
obtain all such shares.
D. MANNER OF PURCHASE. When shares are purchased from the Company,
purchases will be made by the Company or its independent agent on the
purchase date.
When shares are purchased in open-market transactions, purchases by an
independent agent will begin on the purchase date and will be completed as
soon as practicable, but in no event later than 30 days after the
applicable purchase date, except where completion at a later date is
necessary or advisable under any applicable securities laws.
7
<PAGE>
7. CUSTODIAL SERVICE
Any Participant may have certificates for his or her shares of the
Company's common or preferred stock held by the custodian for safekeeping
at no charge. Certificates so deposited will be held in the name of the
custodian, or its nominee, until the custodian is directed in writing by
the Participant to deliver a certificate for the shares or to sell any or
all of the Participant's deposited shares.
Dividends on shares held by the custodian for safekeeping will be
reinvested automatically unless the Participant elects otherwise.
8. STOCK CERTIFICATES
Certificates for shares held under the Plan will be issued to a
Participant only upon written request. Shares purchased through automatic
dividend reinvestment, direct cash investment, payroll deduction or annuity
deduction will be held in the name of the custodian, or its nominee, until
the Participant gives the custodian written instructions to deliver
certificates for some or all of the whole shares held under the Plan.
Unless the Participant otherwise directs, certificates will be issued in
the name in which the account is maintained. A certificate may be issued
in a name other than that in which the account is maintained if the
custodian is presented with a signed written request and a stock
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power, with all signatures guaranteed by an eligible guarantor
institution (banks, stockbrokers, savings and loan associations and credit
unions) with membership in an approved signature guarantee medallion
program pursuant to Securities and Exchange Commission regulations.
9. SALE OF SHARES.
A Participant may request that all or part of his or her shares held by
the custodian be sold. The request must be in writing and bear the
signatures of all persons in whose name the account is maintained and, if
the check for the proceeds from the sale is to be issued in another
person's name, the Participant must complete a stock power with the
signatures of all of the owners guaranteed by an eligible guarantor
institution (banks, stockbrokers, savings and loan associations and credit
unions) with membership in an approved signature guarantee medallion
program pursuant to Securities and Exchange Commission regulations.
The Company or its independent agent will sell the Participant's shares
as soon as practicable after the Company or its independent agent receives
properly documented instructions from the Participant. Neither the Company
nor its independent agent can guarantee any sale price or commission cost.
Proceeds
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from the sale, net of any brokerage fees and expenses, will be sent to
the Participant as soon as practicable.
10. ACCOUNT STATEMENTS AND COMPANY REPORTS
As soon as practicable after every purchase date on which there is
activity in his or her account, the Company or its independent agent will
send to each Participant a statement of account. The statement will detail
the status of the Participant's account, including shares purchased and
dividends reinvested. The Company or its independent agent will also send
to each Participant copies of the Company's annual and quarterly reports,
proxies, proxy statements and other correspondence generally sent to
shareholders.
11. WITHDRAWAL FROM THE PLAN
A. VOLUNTARY CLOSING OF PLAN ACCOUNT. A Participant may close his or
her account at any time by giving written notice to the Company or its
independent agent. As soon as practicable after receipt of such written
notice, the Company or its independent agent will issue a stock certificate
for all whole shares credited to the Participant's Plan account or sell the
shares, as directed by the Participant, and will return any uninvested
dividends in the account. The Company
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or its independent agent will sell any fractional share for cash at
current market price and return the proceeds net of any brokerage fees and
expenses.
B. RETIREMENT. Upon the retirement of a Participant who is an
employee, the payroll deduction option is terminated automatically.
C. TERMINATION OF EMPLOYMENT. Upon termination of employment other
than through retirement, a Participant who is an employee is no longer
eligible for payroll deduction.
12. GENERAL
A. VOTING OF SHARES. The custodian will vote all whole and fractional
shares in accordance with instructions received from the Participant whose
shares are held. If a proxy is not returned or if it is returned unsigned
by the registered owner, the shares will not be voted by the custodian. A
Participant may vote all of his or her shares in person at the
shareholders' meeting.
B. DISTRIBUTIONS. If the Company sells additional common stock through
a rights offering, the rights will be forwarded to the Participant for
disposition. Any stock dividend of common stock or shares resulting from a
stock split or reclassification of common stock will be credited to the
account of the Participant in accordance with stock ownership.
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C. SUSPENSION, TERMINATION OR MODIFICATION. The Company reserves the
right to suspend, terminate or modify the Plan at any time.
D. SUCCESSION. The Plan will be binding and inure to the benefit of
the Company and its successors and assigns.
E. PLEDGE OF ACCOUNT SHARES OR FUNDS. A Participant may not in any
manner create a lien on any shares or funds held by the custodian under the
Plan. Certificates for shares must first be issued to the Participant in
order to be used as collateral.
F. COSTS AND EXPENSES. The Company will charge no brokerage fees in
connection with reinvestment of dividends, direct cash investments or
payroll or annuity deduction purchases. The Company will pay all of the
administrative expense of the Plan. The Company or its independent agent
may charge Participants their share of any brokerage fees and expenses on
the sale of shares.
G. INTEREST. The Company will not pay interest on any amounts held
under the Plan.
H. ADMINISTRATION. The Company will have responsibility for
administering and interpreting the Plan. The Treasurer will have authority
to interpret the Plan, to prescribe, amend and rescind rules and
regulations relating to it, and to make all other determinations deemed
necessary or advisable in
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administering the Plan, including those necessary to prevent any abuse.
The determinations of the Treasurer on the matters referred to in this
paragraph will be conclusive and binding upon all persons in interest. The
Treasurer will create statements, forms and documents necessary for the
effective administration of the Plan.
The Company may act as custodian under the Plan for amounts received
under automatic dividend reinvestment, direct cash investment, payroll
deduction purchases and annuity deduction purchases and for stock
certificates held for safekeeping. The Company may also appoint, from time
to time, an independent agent or agents to act as custodian and perform any
duties relating to the administration of the Plan.
Neither the Company (nor any person that directly or indirectly
controls, is controlled by, or is under common control with the Company)
shall exercise any direct or indirect control or influence over the times
when, or the prices at which, the independent agent may purchase the
Company's common stock for the Plan, the amounts of common stock to be
purchased, the manner in which the security is to be purchased, or the
selection of a broker or dealer (other than the independent agent itself)
through which purchases may be executed.
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I. RESPONSIBILITY. Neither the Company nor its independent agent will
be liable for any act done in good faith or for any good faith omission to
act, including, without limitation, any claim of liability arising out of
failure to terminate a Participant's account upon such Participant's death,
the prices at which shares are purchased or sold for the Participant's
account, the times when purchases or sales are made or fluctuations in the
market value of the Company's common stock.
J. PLAN NOT TO AFFECT EMPLOYMENT. Neither the Plan nor any purchase of
additional shares by any Participant hereunder will confer upon any
Participant who is an employee any right to continue in the employ of the
Company.
K. DEATH OF A PARTICIPANT. Upon the death of a Participant, the
Company or its independent agent will follow the instructions of the
decedent's personal representative with respect to the disposition of the
shares held in the decedent's account under the Plan.
L. SEVERABILITY. If any part of the Plan is determined to be invalid
or void in any respect, such determination will not affect, impair,
invalidate or nullify the remaining provisions of the Plan which will
continue in full force and effect.
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