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EXHIBIT F-2
Quarles & Brady LLP
411 East Wisconsin Avenue
Milwaukee, Wisconsin 53202-4497
Tel. 414.277.5000
Fax 414.271.3552
www.quarles.com
January 10, 2001
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: Application of Wisconsin Energy Corporation
and Wisconsin Electric Power Company on Form U-1 Under
the Public Utility Holding Company Act of 1935
(File No. 70-9741)
Ladies and Gentlemen:
We are furnishing this opinion to the Securities and Exchange Commission
(the "Commission") at the request of Wisconsin Energy Corporation, a Wisconsin
corporation ("WEC"), and Wisconsin Electric Power Company, a Wisconsin
corporation ("Wisconsin Electric"), in connection with their
Application/Declaration on Form U-1, as amended (File No. 70-9741) (the
"Application"), under the Public Utility Holding Company Act of 1935, as amended
(the "Act"). This opinion supplements our earlier opinion, dated December 28,
2000, filed as Exhibit F-1 to Amendment No. 2 to the Application filed with the
Commission on December 28, 2000.
The Application requested that the Commission authorize a proposed
transaction, as further described in the Application (the "Transaction"), in
which: (i) Wisconsin Electric would transfer ownership and control over its
transmission assets to American Transmission Company LLC ("ATC" or the
"Transco"), a Wisconsin limited liability company formed on June 12, 2000, to
become a single-purpose transmission company; (ii) Edison Sault Electric Company
("Edison Sault"), a wholly-owned subsidiary of WEC and an electric utility
company as defined by the Act, would transfer ownership and control over its
transmission assets to the Transco; (iii) Wisconsin Electric and Edison Sault
would receive, in exchange for such transfer, member units of the Transco in
proportion to the value of the transmission assets contributed; (iv) Wisconsin
Electric would purchase Class A shares of ATC Management Inc. (the "Corporate
Manager"), a Wisconsin corporation formed on June 12, 2000, in proportion to the
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Securities and Exchange Commission
January 10, 2001
Page 2
value of the transmission assets contributed to the Transco by itself and Edison
Sault; and (v) Wisconsin Electric would purchase one Class B share of the
Corporate Manager. WEC also requested an order from the Commission affirming
its continued Section 3(a)(1) exemption from registration under the Act
following the Transaction.
By its Order dated December 28, 2000, the Commission granted the
Application (Release No. 35-27329; 70-9741). The Transaction was consummated
effective as of January 1, 2001.
In connection with this opinion, we have examined such corporate records,
certificates and other documents, and such questions of fact and matters of law,
as we have deemed necessary for purposes of this opinion.
The opinions expressed below with respect to the Transaction are subject to
and rely upon the following assumptions and conditions:
(a) All required approvals, authorizations, consents, certificates,
rulings and orders of, and all filings and registrations with, all
applicable federal and state commissions and regulatory authorities
with respect to the Transaction have been obtained or made, as the
case may be (including the approval and authorization of the
Commission under the Act), and the Transaction has been accomplished
in accordance with all such approvals, authorizations, consents,
certificates, orders, filings and registrations.
(b) All corporate formalities required by state law for the consummation
of the Transaction have been taken.
(c) The parties have obtained all consents, waivers and releases, if any,
required for the Transaction under all applicable governing corporate
documents, contracts, agreements, debt instruments, indentures,
franchises, licenses and permits.
(d) The representations and warranties of the parties to the Transaction
in the documents providing for the Transaction are true and correct
in all material respects.
Based upon the foregoing, and subject to the assumptions and conditions set
forth herein, it is our opinion that:
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Securities and Exchange Commission
January 10, 2001
Page 3
1. Each of WEC, Wisconsin Electric and the Corporate Manager is a
corporation validly existing under the laws of the State of Wisconsin.
Edison Sault is a corporation validly existing under the laws of the
State of Michigan. The Transco is a limited liability company validly
existing under the laws of the State of Wisconsin.
2. The Transaction has been carried out in accordance with the
Application. Upon the Transaction having been consummated as
contemplated by the Application:
(a) All State laws applicable to the Transaction have been complied
with;
(b) (i) Having been acquired by Wisconsin Electric pursuant to the
Transaction for the agreed consideration, the shares of the
Corporate Manager's Class A common stock and Class B common stock
so acquired are validly issued, fully paid and (except as
otherwise provided in Section 180.0622(2)(b) of the Wisconsin
Business Corporation Law, as judicially interpreted)
nonassessable, and Wisconsin Electric is entitled to the rights
and privileges appertaining thereto set forth in the Restated
Articles of Incorporation of the Corporate Manager;
(ii) Having been acquired by Wisconsin Electric and Edison Sault
pursuant to the Transaction for the agreed consideration, the
member units representing membership interests in the Transco so
received are validly issued, fully paid and nonassessable, and
Wisconsin Electric and Edison Sault are entitled to the rights
and privileges appertaining thereto set forth in the articles of
organization and operating agreement of the Transco;
(c) Wisconsin Electric has legally acquired the shares of Class A
common stock and Class B common stock of the Corporate Manager
acquired by it. Wisconsin Electric and Edison Sault have legally
acquired the membership interests in the Transco acquired by each
of them; and
(d) The consummation of the Transaction did not violate the legal
rights of the holders of any securities issued by WEC, Wisconsin
Electric or any associate company thereof.
We are attorneys licensed to practice law in the State of Wisconsin. In
rendering this opinion, we have relied as to matters of Michigan law on the
opinion of Loomis, Ewert, Parsley,
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Securities and Exchange Commission
January 10, 2001
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Davis & Gotting, P.C., of even date herewith, a copy of which is being filed as
an exhibit to the Application.
We hereby consent to the filing of this opinion as an exhibit to the
Application.
Very truly yours,
/s/ Quarles & Brady LLP
QUARLES & BRADY LLP
